05-28-13 Council Packet - Laserfiche WebLink

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CITY OF LINO LAKES, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2012 53 Note 8 STEWARDSHIP COMPLIANCE AND ACCOUNTABILITY (CONTINUED) B. Expenditures in Excess of Budget The following is a listing of expenditure categories that exceed budget appropriations for non-major funds: Budge t ActualExcess Program Recreation Special Revenue Fund: Supplies48,815 $ 108,631 $ (59,816)$ Note 9 CONTINGENCIES Tax Increment Districts – The City’s tax increment districts are subject to review by the State of Minnesota Office of the State Auditor (OSA). Any disallowed claims or misuse of tax increments could become a liability of the applicable fund. Management has indicated that they are not aware of any instances of noncompliance which could have a material effect on the financial statements. Federal and State Funds – The City receives financial assistance from fe deral and state governmental agencies in the form of grants. The disbursement of funds received unde r these programs generally requires compliance with the terms and conditions specified in the grant agreements and is subject to audit by the gran tor agencies. Any disallowed claims resulting from such a udits could become a liability of the applicable fund. However, in the opinion of management, any such disallowed claims will not have a material effect on any of the financial statements of the individual fund type s included herein or on the overall fina ncial position of the City at December 31, 2012. Litigation – The City, in connection with the normal conduct of its affairs, is involved in various claims, judgments, and litigation. As of December 31, 2012 any potential affect this may have on the City is not estimable, however it is not expected to have a material effect on the financial statements of the City. Note 10 DEFERRED AD VALOREM TAX LEVIES - BONDED DEBT General Obligation bond issues sold by the City are finan ced by ad valorem tax levies and special assessment bond issues sold by the City are partially financed by ad valorem tax levies in addition to special assessments levied against the benefiting properties. When a bond issue to be fina nced partially or completely by ad valorem tax levies is sold, specific annual amounts of such tax levies are stated in the bond resolution and the County Auditor is notified and instructed to levy these taxes over the appropriate years. The future tax levies are subject to cancellation when and if the City has provided alternative s ources of financing. The City Council is required to levy any additional taxes found necessary for fu ll payment of principal and interest. These future scheduled tax levies are not shown as assets in the accompanying financial statements at December 31, 2012. Future scheduled tax levies for all bonds out standing at December 31, 2012 totaled $16,527,862.