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CITY OF LINO LAKES, MINNESOTA <br />NOTES TO FINANCIAL STATEMENTS <br />December 31, 2008 <br />Note 6 DEFINED BENEFIT PENSION PLANS — STATEWIDE (CONTINUED) <br />B. FUNDING POLICY <br />Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. These statutes are <br />established and amended by the state legislature. The City makes annual contributions to the pension plans <br />equal to the amount required by state statutes. PERF Basic Plan members and Coordinated Plan members <br />are required to contribute 9.10% and 6.0% respectively, of their annual covered salary. Contribution rates in <br />the Coordinated Plan will increase in 2009 to 6.75 %. PEPFF members were required to contribute 8.6% of <br />their annual covered salary in 2008. That rate will increase to 9.4% in 2009. The City is required to <br />contribute the following percentages of annual covered payroll: 11.78% for Basic Plan PERF members, <br />6.5% for Coordinated Plan PERF members, and 12.9% for PEPFF members. Employer contribution rates <br />for the Coordinated Plan and PEPFF will increase to 6.75% and 14.1 %, respectively, effectively January 1, <br />2009. The City's contributions to the Public Employees Retirement Fund for the years ending December 31, <br />2008, 2007, and 2006 were $183,456, $172,504 and $156,599 respectively. The City's contributions to the <br />Public Employees Police & Fire Fund for the years ended December 31, 2008, 2007, and 2006 were <br />$268,569, $219,592, and $187,212 respectively. The City's contributions were equal to the contractually <br />required contributions for each year as set by state statute. <br />Note 7 METROPOLITAN COUNCIL ENVIRONMENTAL SERVICES <br />During 1971, the Metropolitan Waste Control Commission (MWCC) was organized to provide for consolidation of <br />the sanitary sewer collection, treatment and disposal in the seven county metropolitan area surrounding Minneapolis <br />and St. Paul. Previously, these operations were maintained by the city governments on an individual or collective <br />basis. The MWCC merged with the Metropolitan Council during 1994 to form Metropolitan Council Wastewater <br />Services (MCWS) and is now called the Metropolitan Council Environmental Services (MCES). The MCES bills the <br />City annually based upon estimated volume and budgeted costs. The City follows the accounting policy of <br />recognizing these charges as an expense of the sewer utility operation in the year for which they are billed. <br />Note 8 STEWARDSHIP COMPLIANCE AND ACCOUNTABILITY <br />A. Deficit Fund Balances <br />The City has deficit fund balances at December 31, 2008 as follows: <br />Fund Balance <br />Deficit <br />Dedicated Parks $ (668,224) <br />Tax Increment Financing 1 -11 (907,563) <br />I35E Interchange (20,833) <br />CSAH 14/8 Reconstruction Project (119,881) <br />The City intends to fund these deficits through future tax levies, special assessment levies, tax increments, <br />transfers from other funds, and various other sources. <br />B. Expenditures in Excess of Budget <br />The following fund had expenditures in excess of budget for 2008: <br />Budget Actual Excess <br />Program Recreation Special Revenue Fund $ 142,705 $ 182,808 $ (40,103) <br />51 <br />