Annual Financial Report 12/31/1984

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CITY OF LINO LAKES, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 1984 Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued LOCAL GOVERNMENT AID REVENUE RECOGNITION Local government aid is provided to the City by the State as a shared tax based upon a statutory formula and without restrictions. Payment from the State is generally received during each calendar year for that calendar year. The City recognizes local government aid revenue when it becomes both measurable and available to finance current operations. In practice, local government aid is recognized as revenue as it is received in cash. GRANT REVENUE RECOGNITION The City receives various Federal, State and other grants, the purpose of which is to fund specific City expenditures. These revenues are recognized at the time of the specific expenditures. The City also receives Federal Revenue Sharing and other general purpose grants. These grants are recognized as revenues in the period to which the grant applies. The City is a sub- recipient of Community Development Block Grant Funds received through the County of Anoka. The City recognizes grant revenue as qualifying expenditures are incurred. The County has agreed to perform all audits of the grant program as required under the Housing and Community Development Act of 1974, Title I, of Public Law 93 -383. PARK DEDICATION FEE REVENUE RECOGNITION The City receives Park dedication fees from developers. The amount due the City is collectible when the developer's land is platted. The City has granted a delay in the collection from several property owners pending development of the platted property. The amounts not collected at the normal time of receipt have been presented as deferred revenue. The amount of unrecognized park dedi- cation fees due the City upon application for building permits was $6,820 and $11,316 at December 31, 1984 and 1983 respectively. PROPERTY TAX REVENUE RECOGNITION The City Council annually adopts a tax levy and certifies it to the County for collection. The County is responsible for billing and collecting all property taxes for itself, the City, the local School District and other taxing authorities. These taxes are payable (by property owners) by May 15 and October 15 of each calendar year. These taxes are collected by the County and remitted to the City by approximately July 15, and December 15. Additionally, delinquent collections (November through February) are remitted to the City each March. The City has no ability to enforce payment of property taxes by property owners. The County possesses this authority. Taxes on homestead property (as defined by State Statutes) are partially reduced by a homestead credit. This credit is paid to the City by the State in lieu of taxes levied against homestead property. The State remits this credit in installments each year.