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SPECIAL COUNCIL MEETING JUNE 24, 1996 <br />Noted that the General Fund balance increased by $215,000. Revenues exceeded <br />expenditures and expenditures were under budget. This is due partially to the City <br />deciding not to hire personnel as planned. In addition, there were some Public <br />Works projects that were not completed. The need for a one-half year cash <br />balance was explained. The City now has adequate reserve to meet cash flow. <br />However, the City has not met the employee contingency reserve of $254,000 as <br />outlined in Resolution No. 03 - 91. <br />Reduction of intergovernmental dollars was outlined. See page 17 of the audit. <br />Noted the recreation program fund had increased. However, there is no formal <br />budget for the recreation fund and a recommendation was made to formally adopt <br />a recreation program budget. <br />Reviewed the schedule of inflow and outflow of the debt funds. See page 20 of <br />the audit. <br />Reviewed all the bond issues. See page 22 of the audit. <br />Reviewed all the Capital Project Funds. See page 23 of the audit. Noted a <br />decrease in construction funds. <br />Reviewed the Dedicated Park Fund. <br />Provided an analysis of the Area and Unit Fund adopted in 1988. The current fund <br />balance is over $5,000,000. <br />Council Member Lyden asked if the fund balance in the Area and Unit Fund was rather <br />large. Mr. Espe felt that it was not excessive. If improvements budgeted for 1996 are <br />completed, the fund balance should be reduced by one-half. In addition, some of the Area <br />and Unit Funds are dedicated for the repayment of three (3) debt funds. <br />Reviewed the Construction Fund noting that the deficit in this fund will be <br />eliminated by the reimbursement from MnDOT and Anoka County. <br />Reviewed the Water and Sewer Fund. Both funds saw an increase in fund balance <br />and the City is starting to reach the "break even" point. The City should be <br />building reserves for the expansion and improvement to the systems. The single <br />largest expense for the Sewer Fund is the MCES charges which is expected to be <br />9% in 1996. <br />Gas Utility - The City of Circle Pines provides gas service to portions of Lino <br />Lakes through a franchise agreement. Sales of gas to Lino Lakes shows an <br />accumulated earning of $185,000. The City was commended for its successful <br />efforts to receive supplemental revenues. <br />PAGE 2 <br />