Annual Financial Report 12/31/1987

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CITY OF LINO LAKES, MINNESOTA Page 11of19 NOTES TO FINANCIAL STATEMENTS December 31, 1987 NOTE - DETAIL NOTES ON ALL FUND AND ACCOUNT GROUPS (CONTINUED) LEGAL DEBT MARGIN The City is subject to a statutory limitation by the State of Minnesota for bonded indebtedness payable principally from taxes. The City of Lino Lakes legal debt margin for 1987 and 1986 is computed as follows: 1987 1986 Assessed value (after fiscal disparities and tax increment) $32,019,057 $29,012,612 Debt limit (7 -1/3% of assessed value) $2,348,064 $2,127,591 Amount of debt applicable to debt limit Total bonded debt $4,310,000 $3,126,820 Less: Nonapplicable debt (i.e., tax increment, revenue, and special assessment supported) 4,194,500 3,054,320 Less: Cash and investments in related Debt Service Funds 728 0 Total debt applicable to limit $114,772 $72,500 Legal debt margin $2,223,292 $2,055,091 Legal debt margin is calculated on general obligation bond issues only (i.e., this does not include General Obligation Debt with special assessments pledged for payment or Revenue/Enterprise Fund bonded debt). COMPENSATED ABSENCES The accrued liability for compensated absences is not recorded as a liability in the General Long -Term Debt Group of Accounts (for governmental funds) nor the Proprietary Funds. Unused vacation, the portion of sick leave payable as severance pay, and the compensatory time are not considered material to these fmancial statements. Unpaid vacation pay totalled $7,341 and $3,655 at December 31, 1987 and 1986 respectively. The City also has an unrecorded contingent liability for unused employee sick leave of $117,000 and $95,000 at December 31, 1987 and 1986 respectively.