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City of Lino Lakes, Minnesota
<br />Management Report, Page 43
<br />such bad debts on a combined expense line "administrative - other ". We recommend the
<br />following:
<br />1. Request that Circle Pines provide their calculation of franchise fee remittances including
<br />bad debt adjustments.
<br />2. Review with Circle Pines their methods of enforcing collection and consider adopting
<br />such procedures within the City such as including significant outstanding delinquent
<br />billings on assessment search records.
<br />3. Annually update the following schedule to analyze fluctuation in revenue data.
<br />Residential
<br />Commercial Taal
<br />Increase /(Decrease Increase /(D tease Increase / (D maase
<br />Yew Amount Amount Percent Amount Percent Amount Amount Percent
<br />°TB= 567,387 516,526 583,913
<br />1982 88,195 520,808 30.88% 18,781 52,255 13.65% 106,976 523,063 27.48%
<br />1983 96,272 8,077 9.16% 22,478 3,697 19.68% 118,750 11,774 11.01%
<br />1984 97,007 735 0.76% 23,829 1,351 6.01% 120,836
<br />2,086 1.76%
<br />1985 102,156 5,149 5.31% 29,356 5,527 23.19% 131,512 10,676 8.84%
<br />1986 90,407 (11,749) (11.50)% 24,764 (4,592) (15.64)% 115,171 (16,341) (12.43)%
<br />1987 82,787 (7,620) (8.43)% 19,866 (4,898) (19.78)% 102,653 (12,518) (10.87)%
<br />1988 114,883 32,096 38.77% 21,845 1,979 9.96% 136,728 34,075 33.19%
<br />Bad Debts Interruptible Sales
<br />Increase / (Decrease) Increase / (Decrease)
<br />Year Amount Amount Percent Amount Amount Percent
<br />1981 $105,143
<br />1982 118,734 $13,591 12.93%
<br />1983 146,092 27,358 23.04%
<br />1984 155,626 9,534 6.53%
<br />1985 149,590 (6,036) (3.88)%
<br />1986 92,822 (56,768) (37.95)%
<br />1987 $3,334 $3,334 3.25% 88,509 (4,313) (4.65)%
<br />1988 2,757 (577) (17.31)% 83,363 (5,146) (5.81)%
<br />Prior to 1987, bad debts were netted with sales.
<br />The City of Lino Lakes has rights to receive payment of net income after the accumulated
<br />retained earnings deficit is eliminated. Prior to 1988, the City received no such distributions. The
<br />Circle Pines gas utility has accumulated a positive retained earnings balance in excess of $500,000
<br />while the Lino Lakes retained earnings is in a deficit position.
<br />The City has taken the following actions regarding the gas utility operations:
<br />• Successfully worked to gain special State legislation to allow a greater number of
<br />members on the Joint Gas Utility Commission.
<br />• Reviewed optional criteria for representation on the Commission to allow for a fair and
<br />equitable method of appointing members from each City.
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