Management Report and Recommendations 12/31/1993

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City of Lino Lakes, Minnesota Management Report, Page 21 Community Development Block Grant The Community Development Block Grant (CDBG) Fund was established in 1982 to account for the financial activity related to the projects to be funded by the CDBG program. The City entered into an agreement with Anoka County to receive CDBG funds. The County of Anoka, along with other governmental units, was awarded the grant. The City of Lino Lakes is considered to be a sub - grantee and must comply with the provisions of the grant agreement. The City has established the compliance procedures that are required to be documented in City records. Proper documentation with the grant agreement has aided the City in receiving the monies applied for regarding the reimbursement of City expenditures. As of December 31, 1993 this fund had a deficit fund balance of $8,314. This deficit is expected to be eliminated through a transfer in 1994. Our prior management report disclosed that CDBG reimbursements were not requested on a timely basis. Beginning in 1993, the finance staff is responsible for CDBG reimbursement. Audit procedures disclosed that CDBG reimbursements are current as of December 31, 1993. 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 will estimate the required transfer needed to meet debt payments for the subsequent year. In December, these estimated amounts shall be transferred to the various debt funds. The City has estimated scheduled area and unit assessments needed to meet debt requirements. We recommend that the City monitor actual versus projected area and unit assessment collections to assure that debt payment requirements will be met. The City intends to retire debt from the various area and unit charges. Careful monitoring of anticipated collections compared to actual is required to assure timely availability of monies to retire debt. Balances available after debt commitments are met can then be used for non - assessable system improvements.