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<br />City of Lino Lakes, Minnesota
<br />Management Report, Page 14
<br />The City's December 31, 1995 fund balance totaled $2,086,231. The City's General Fund
<br />balance has been as follows for the past ten years:
<br />December 31,
<br />1986
<br />1987
<br />1988
<br />1989
<br />1990
<br />1991
<br />1992
<br />1993
<br />1994
<br />1995
<br />Fund Balance
<br />Reserved/
<br />Designated
<br />$83,714
<br />52,593
<br />96,626
<br />53,290
<br />1,169,624
<br />1,265,236
<br />1,406,296
<br />1,673,039
<br />1,870,934
<br />2,086,231
<br />Undesignated
<br />$455,666
<br />589,799
<br />747,836
<br />976,763
<br />Total Increase
<br />$539,380
<br />642,392 $103,012
<br />844,462 202,070
<br />1,030,053 185,591
<br />1,169,624 139,571
<br />1,265,236 95,612
<br />1,406,296 141,060
<br />83,620 1,756,659 350,363
<br />- 1,870,934 114,275
<br />2,086 ,231 215,297
<br />The increase in designated fund balance reflects the City's adoption of a reserve policy
<br />pursuant to resolution 91 -3. The reserve policy addresses three areas: 1) Cash flow
<br />requirements, 2) Contingent employee benefits, and 3) General contingencies.
<br />As previously stated, property taxes and related state aids account for over 73% of budget
<br />1996 revenue sources of the General Fund. This revenue is not received until July and December
<br />of each year (the second half of the year). As a result, the City is required to have sufficient
<br />reserves at the beginning of the year to fund operations of the first half of the year. The City's
<br />cash flow reserve requirement is computed as follows:
<br />1996 Budgeted Levy (Includes Homestead Credit)
<br />1996 Anticipated Local Govemment Aid
<br />Total
<br />Cash -Flow Reserve (50% of total)
<br />$2,685,794
<br />155,212
<br />$2,841,006
<br />$1,420,503
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