Comprehensive Annual Financial Report 12/31/2015

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CITY OF LINO LAKES, MINNESOTA MANAGEMENT'S DISCUSSION AND ANALYSIS DECEMBER 31, 2015 OVERVIEW OF THE FINANCIAL STATEMENTS (CONTINUED) Fiduciary funds Fiduciary funds are used to account for assets held by the City as an agent for individuals, private organizations, or other governments. Notes to the financial statements — The notes provide additional information that is essential to a full understanding of the data provided in the government -wide and fund financial statements. The notes to the financial statements can be found on pages 35-65 of this report. Other information — The combining statements and schedules referred to earlier in conjunction with nonmajor governmental funds can be found on pages 76-91 of this report. GOVERNMENT -WIDE FINANCIAL ANALYSIS As noted earlier, net position may serve over time as a useful indicator of a government's financial position. The City of Lino Lakes' assets exceeded liabilities by $84,554,618 at the close of the most recent fiscal year, a decrease of $5,624,550 from the previous year. This decrease is primarily due annual depreciation of capital assets. The largest portion of the City of Lino Lakes' net position (56%) reflects its net investment in capital assets (e.g. land, buildings, machinery, equipment, and infrastructure). The City of Lino Lakes uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City of Lino Lakes' investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. Condensed versions of the statements of net position at December 31, 2015 and 2014 are as follows: Of the remaining balance of the City of Lino Lakes' net position, restricted net position (10%) are to be used for activities restricted by law (special revenue funds), debt service requirements and a nonexpendable environmental fund. Unrestricted net position (34%) may be used to meet the government's ongoing obligations to citizens and creditors. 14 Governmental Activities Business -Type Activities Total 2015 2014 2015 2014 2015 2014 Current and Other Assets $ 32,222,786 $ 32,904,991 $ 14,881,531 $ 14,029,608 $ 47,104,317 $ 46,934,599 Capital Assets 41,228,037 36,212,984 29,127,829 27,556,022 70,355,866 63,769,006 Total Assets 73,450,823 69,117,975 44,009,360 41,585,630 117,460,183 110,703,605 Deferred outflows of resources 985,081 - 11,660 - 996,741 - Noncurrent Liabilities Outstanding 27,144,998 19,479,195 149,386 52,790 27,294,384 19,531,985 Other Liabilities 5,900,707 903,912 63,771 88,540 5,964,478 992,452 Total Liabilities 33,045,705 20,383,107 213,157 141,330 33,258,862 20,524,437 Deferred inflows of resources 636,040 - 7,404 - 643,444 - Net Position: Net Investment in Capital Assets 18,230,746 19,540,807 29,127,829 27,556,022 47,358,575 47,096,829 Restricted 8,635,293 8,666,357 - - 8,635,293 8,666,357 Unrestricted 13,888,120 20,527,704 14,672,630 13,888,278 28,560,750 34,415,982 Total Net Position $ 40,754,159 $ 48,734,868 $ 43,800,459 $ 41,444,300 $ 84,554,618 $ 90,179,168 Of the remaining balance of the City of Lino Lakes' net position, restricted net position (10%) are to be used for activities restricted by law (special revenue funds), debt service requirements and a nonexpendable environmental fund. Unrestricted net position (34%) may be used to meet the government's ongoing obligations to citizens and creditors. 14