06/05/2006 Council Packet - Laserfiche WebLink

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SAC Revolving The SAC Revolving Fund was established in 1990 to account for a refund from the MCES (formerly MWCC) of past SAC charges which were paid by residents that had not hooked up to the sewer system. A summary of financial activity of this fund is as follows: Revenue SAC refund Investment earnings Total revenue Expenditures: Refunds Prior Years 2005 Total $ 368,816 $ - $ 368,816 253,541 9,614 263,155 622,357 9,614 631,971 $ 257,808 $ 2,186 259,994 Fund balance - December 31, 2005 $ 371,977 The City is allowing current homeowners to request a refund with 4% interest. If refunds and claims are not submitted, the City will pay the full SAC charge from this fund at the time of hook -up. This policy will likely require a supplemental future revenue source as the current MCES SAC charges times the potential hookups exceeds the available balance. If the MCES SAC fees continue to increase at a rate that is faster than the investment earnings rate, other revenue sources will be needed in the future to fund the actual connections when they occur. Area and Unit Charge Fund On January 11, 1988, the City Council approved Resolution 1 -88, which established the Area and Unit Charge Fund for the City. The purpose of this fund is to collect various area and unit charges to be used to meet debt payments. Before October 1 of each year, the City estimates the required transfer needed to meet debt payments for the subsequent year. In December, these estimated amounts are transferred to the various debt funds. We recommend that the City continue to closely monitor actual versus projected area and unit assessment collections to assure that debt payment requirements will be met. Designations of balances required for debt service is necessary to define discretionary construction balances available to the City. The financing plan for the following bond issues have pledged area and unit charges for the repayment of debt service: • Improvement and Utility Bonds of 2004A • Improvement Refunding Bonds of 1999A • Water Revenue Bonds of 1999B • Water Revenue Bonds of 1996B The Improvement and Utility Bonds of 2004A and Improvement Refunding Bonds of 1999A have future debt service requirements (principal and interest) totaling $1,744,719 and $363,342, respectively. During 2005, a transfer of $383,000 was made to the Improvement Refunding Bonds of 1999A debt service fund. (8)