HomeMy WebLinkAbout000 - 8-1-17 Completed Packet
NOTICE OF MEETING
City Council Meeting
Tuesday, August 1, 2017 7:00 P.M.
City of Lake Elmo | 3800 Laverne Avenue North
AGENDA
A. Call to Order/Pledge of Allegiance
B. Approval of Agenda
C. Approval of Minutes
1. July 18, 2017
D. Public Comments/Inquires
E. Presentations
F. Consent Agenda
2. Approve Payment of Disbursements and Payroll
3. Accept 2nd Quarter Financials – General Fund and Utility Funds
4. Labor Agreement with Local 49ers, January 1, 2017-December 31, 2019
5. Authorize RFP for Enterprise Resource Planning System (ERP) Software for City
6. 2017 Seal Coat Project – Pay Request No. 1.
7. 2017 Street Improvements – Change Order No. 1.
8. CSAH 13 (Ideal Avenue/Olson Lake Trail) – Approve Cooperative Agreement Payment No. 2.
9. Approve Youth Services Bureau 2018 Agreement
10. Approve Sunfish Lake Park Ski Trail Grant – Resolution 2017-084
11. Approve Parks Commission Appointment
G. Regular Agenda
12. Variance Amendment for 9359 Jane Rd N – Public Hearing – Resolution 2017-075
13. Hidden Meadows Easement Vacation – Public Hearing – Resolution 2017-082
14. Glenwood Homes Variance Request - 8690 Lake Jane Trail N. – Resolution 2017-083
15. Presentation and Acceptance of 2016 Comprehensive Annual Financial Report
16. Lions Park Improvement Project Bids
H. Council Reports
I. Staff Reports and Announcements
J. Adjourn
Our Mission is to Provide Quality Public Services in a Fiscally Responsible
Manner While Preserving the City’s Open Space Character
CITY OF LAKE ELMO
CITY COUNCIL MINUTES
JULY 18, 2017
CALL TO ORDER/PLEDGE OF ALLEGIANCE
Mayor Pearson called the meeting to order at 7:00 pm.
PRESENT: Mayor Mike Pearson and Councilmembers Justin Bloyer, Julie Fliflet, Jill Lundgren
and Christine Nelson
Staff present: Administrator Handt, City Clerk Johnson, City Attorney Sonsalla, City Engineer
Griffin, Planning Director Wensman, Fire Chief Malmquist, Public Works Director Weldon,
Building Official Bent and Sergeant Osterman.
APPROVAL OF AGENDA
Item 7, “Approve Water Meter Replacements” was moved to the end of the Regular Agenda. Item
18, “Approve Amendments to Chapter 72: Parking Regulations & Chapter 73: Parking Schedules
of the City Code” was removed from the agenda.
Councilmember Bloyer, seconded by Councilmember Nelson moved TO APPROVE THE
AGENDA AS AMENDED. Motion passed 5 – 0.
ACCEPT MINUTES
Minutes of the July 5, 2017 Regular Meeting were accepted as presented.
PUBLIC COMMENTS/INQUIRIES
Virginia Pleban, 8245 59th Street N., announced that there will be an ice cream social held at the
historic courthouse in Stillwater on Thursday, July 20th and commented on clean up of Kleis
Park.
PRESENTATIONS
The Cimarron Rowing Club presented information on the history of rowing in Lake Elmo and the
upcoming NWIRA Championship Regatta.
CONSENT AGENDA
2. Approve Payment of Disbursements
3. Accept June 2017 Assessor’s Report
4. Accept June 2017 Building Department Report
5. Accept June 2017 Fire Department Report
6. Accept June 2017 Public Works Department Report
LAKE ELMO CITY COUNCIL MINUTES
JULY 18, 2017
Page 2 of 5
7. moved to Regular Agenda
8. Inwood Water Tower (No. 4) – Approve Pay Request No. 11
9. Old Village Phase 3 Street & Utility Improvements – Approve Pay Request No. 1
10. 2017 Street Improvements – Approve Pay Request No. 1
11. 2017 Mill and Overlay – Accept Quotes and Award Contract
12. CSAH 13 (Ideal Avenue/Olson Lake Trail) – Approve Cooperative Agreement Pmt No. 1
13. Wellhead Protection Plan Phase 2 – Award Engineering Services Task Order
14. Approve Building and Planning Regulations Permit Fee Schedule
15. Approve Revision of Contractor Licensing
16. Approve Adoption of the 2017 Lake Elmo Property Maintenance Code
17. Approve Public Safety Committee Appointments
18. removed from agenda
Councilmember Bloyer, seconded by Councilmember Fliflet, moved TO APPROVE THE
CONSENT AGENDA AS PRESENTED. Motion passed 5 - 0.
ITEM 19 Fire Department Staffing:
Fire Chief Malmquist presented information on current staffing, response types and statistics.
Staffing cost comparison and potential costs were also reviewed. Discussion was held regarding
specific equipment used to respond to specific types of calls.
Dave Moore, Public Safety Committee member, stated that fire department staffing is a
nationwide problem and urged the City to avoid taking short cuts.
Cullen Case, Public Safety Committee member, stated that option B presented in the council
meeting packet is the best option to meet the City’s current and future needs.
Lisa McGinn, Public Safety Committee member, expressed a need to hire firefighters now and
continue to plan for the future.
Mayor Pearson, seconded by Councilmember Bloyer, moved TO APPROVE OPTION A AS
PRESENTED WITH A CAP OF 24 HOURS PER WEEK. Motion passed 5 – 0.
Councilmember Fliflet, seconded by Councilmember Lundgren, moved TO DIRECT STAFF
TO WORK WITH THE PUBLIC SAFETY COMMITTEE AND ANY COUNCILMEMBERS
THAT WANT TO BE INVOLVED TO EXPLORE THE OPTION OF AN EAST METRO
FIRE DISTRICT AND OTHER LONG TERM SOLUTIONS.
Mayor Pearson, seconded by Councilmember Bloyer, moved TO TABLE THE PRIMARY
MOTION AND REFER THE MATTER TO THE PUBLIC SAFETY COMMITTEE FOR
DISCUSSION. Motion passed 3 – 1 – 1. (Fliflet – nay; Lundgren – present/not voting)
LAKE ELMO CITY COUNCIL MINUTES
JULY 18, 2017
Page 3 of 5
Councilmember Bloyer, seconded Councilmember Nelson, moved TO APPROVE THE PART
TIME FIREFIGHTER JOB DESCRIPTION AND AUTHORIZE ADVERTISING FOR THE
POSITIONS. Motion passed 5 – 0.
ITEM 20: Easton Village 3rd Addition Final Plat
Planning Director Wensman presented an overview of the proposed plat for the Easton Village
3rd Addition, noting changes from the preliminary plat and outlots proposed for parkland
dedication.
Councilmember Nelson, seconded by Councilmember Bloyer, moved TO ADOPT
RESOLUTION 2017-076 APPROVING EASTON VILLAGE 3RD ADDITION FINAL PLAT
WITH THE 10 CONDITIONS OF APPROVAL AS RECOMMENDED BY STAFF AND
THE PLANNING COMMISSION. Motion passed 3 – 1 – 1. (Lundgren – nay; Fliflet –
present/not voting)
ITEM 21: Easton Village 3rd Addition Developers Agreement
Planning Director Wensman reviewed updates made to the draft agreement prior to the meeting
and discussed future need for a railroad crossing. City Attorney Sonsalla suggested language for
the Developers Agreement to ensure cost participation in a future railroad crossing.
Councilmember Nelson, seconded by Mayor Pearson, moved TO ADOPT RESOLUTION
2017-081 APPROVING THE DEVELOPERS AGREEMENT FOR EASTON VILLAGE 3RD
ADDITION WITH THE ADDITON OF LANGUAGE PERTAINING TO THE
DEVELOPER’S CONSENT TO PAY ITS PORTION OF COSTS RELATED TO THE
ADDITION OF A RAILROAD CROSSING. Motion passed 3 – 2. (Fliflet, Lundgren –
present/not voting)
ITEM 22: Library Parking Lot Paving Project
City Administrator Handt reviewed information related to the cost and design of the library
parking lot and discussed funding sources for the project.
Library Board Member Brett Emmons reviewed how the plans for the parking lot evolved and
reviewed option 3 provided in the council meeting packet. City Engineer Griffin stated that in
his opinion the soils would need improvement prior to paving.
Councilmember Lundgren, seconded by Councilmember Fliflet, moved TO AWARD THE
LIBRARY PARKING LOT PAVING PROJECT TO BUCK BLACKTOP INC FOR $241,890
AND APPROVE AN ADDITIONAL AMOUNT OF $4,600 FOR PRE-CONSTRUCTION
SITE WORK AND CONSTRUCTION OBSERVATION.
Mayor Pearson stated he did not support the motion as he doesn’t feel sidewalks are necessary
and feels unsure about the benefits of the water storage elements.
LAKE ELMO CITY COUNCIL MINUTES
JULY 18, 2017
Page 4 of 5
Susan Dunn, 11018 Upper 33rd Street N., stated it is worth investing in a safe downtown.
Councilmember Bloyer, seconded by Councilmember Lundgren, moved TO AMEND THE
PRIMARY MOTION TO ADD THAT ALL FUNDING FOR THE LIBRARY PARKING LOT
WILL COME FROM THE PARK DEDICATION FUND. Motion passed 3 – 2. (Pearson,
Nelson – nay)
Councilmember Bloyer moved TO AMEND THE PRIMARY MOTION TO ADD THAT THE
RAINGARDEN PORTION OF THE PROJECT NOT EXCEED $20,000. Motion failed – no
second.
Primary motion failed 2 – 3.
Mayor Pearson, seconded by Councilmember Nelson, moved TO AWARD THE PARKING
LOT PAVING PROJECT TO MILLER EXCAVATING INC FOR $71,401.80 AND
APPROVE AN ADDITONAL AMOUNT OF $4,600 FOR PRE-CONSTRUCTION
OBSERVATION CONTINGENT UPON LIBARARY BOARD APPROVAL. Motion passed 4
– 1. (Lundgren –nay)
Mayor Pearson, seconded by Councilmember Nelson, moved TO REJECT ALL BIDS
ASSOCIATED WITH THE 2016 PLAN. Motion passed 3 – 1 – 1. (Lundgren – nay; Fliflet
– present/not voting)
ITEM 23: Bee Safe Resolution and IPM
City Administrator Handt reviewed the background of the Bee Safe Resolution adopted in 2015
and proposed changes to remove “systemic pesticides” from the Integrated Pest Management
Plan.
Councilmember Bloyer, seconded by --- moved TO REPEAL BEE SAFE RESOLUTION
2012-13 AND THE INTEGRATED PEST MANAGEMENT PLAN.
Tedi Carlson, Environmental Committee Member, suggested allowing the Environmental
Committee to come up with another version to keep the City bee friendly.
Councilmember Lundgren, seconded by Councilmember Fliflet, moved TO SEND THIS
ITEM TO THE ENVIRONMENTAL COMMITTEE TO FURTHER WORK. Motion failed 2
– 3. (Pearson, Bloyer, Nelson – nay)
Primary motion passed 3 – 2. (Fliflet, Lundgren – nay)
ITEM 7: Approve Water Meter Replacements
City Administrator Handt provided an overview of the request to purchase water meters to
replace existing malfunctioning meters and hire an independent contractor to install them.
LAKE ELMO CITY COUNCIL MINUTES
JULY 18, 2017
Page 5 of 5
Mayor Pearson, seconded by Councilmember Lundgren, moved TO APPROVE THE
PURCHASE OF 250 WATER METERS AND AUTHORIZE HIRING OF AN
INDEPENDENT CONTRACTOR TO CONDUCT SCHEDULING, REPLACEMENT AND
DATA ENTRY OF THE NEW WATER METERS. Motion passed 4 – 1. (Fliflet – nay)
COUNCIL REPORTS
Mayor Pearson: No report
Councilmember Nelson: Attended Friends of Sunfish Lake Park meeting.
Councilmember Lundgren: Commented on pothole issues on Olson Lake Trail
Councilmember Bloyer: No report
Councilmember Fliflet: No report
STAFF REPORTS AND ANNOUNCEMENTS
Administrator Handt: Provided reminder of the upcoming Pankalo open house August 1st.
Currently working on the space needs study and scheduling a joint meeting of the City Council
and Finance Committee.
City Clerk Johnson: Reported on projects currently being completed by summer intern staff.
City Attorney Sonsalla: Worked with Building Official on the property maintenance code and
preparing for a hearing on a hazardous building matter.
Planning Director Wensman: Reported on upcoming Comp Plan Advisory Board upcoming
public open house and a Village stakeholder meeting.
City Engineer Griffin: Working on plan reviews and CSAH 17 Phase 3.
Meeting adjourned at 10:03 pm.
LAKE ELMO CITY COUNCIL
ATTEST:
______________________________
Mike Pearson, Mayor
_______________________________
Julie Johnson, City Clerk
STAFF REPORT
-- page 1 --
DATE: August 1, 2017
CONSENT
TO: Mayor and City Council
FROM: Brian Swanson, Finance Director
AGENDA ITEM: Approve Disbursements in the amount of $441,712.09
REVIEWED BY: Kristina Handt, City Administrator
BACKGROUND INFORMATION/STAFF REPORT:
The City of Lake Elmo has the fiduciary responsibility to conduct normal business operations.
Below is a summary of current claims to be disbursed and paid in accordance with State law and
City policies and procedures.
FISCAL IMPACT: $441,712.09
Claim # Amount Description
ACH $ 17,184.54 Payroll Taxes to IRS & MN Dept. of Revenue 07/20/17
ACH $ 7,735.82 Payroll Retirement to PERA 07/20/17
ACH $ 1,000.00 Payroll Retirement to MDCP 07/20/17
n/a $ 0.00 Payroll Checks (none)
Direct Deposits $ 44,079.93 Payroll Deposits 07/20/17
46199-46266 $ 371,651.80 Accounts Payable 08/01/17
2858 $ 60.00 Accounts Payable 08/01/17 (Library Checks)
TOTAL $ 441,712.09
RECOMMENDATION:
If removed from the consent agenda, the recommended motion is as follows:
“Motion to approve the aforementioned disbursements in the amount of $441,712..09”
ATTACHMENTS:
1.Accounts Payable – check register
STAFF REPORT
DATE: August 1, 2017
CONSENT
MOTION
TO: City Council
FROM: Brian A. Swanson – Finance Director
AGENDA ITEM: Accept 2nd Quarter Financials
REVIEWED BY: Kristina Handt – City Administrator
BACKGROUND:
The City of Lake Elmo has fiduciary authority and responsibility to conduct normal business operations
and report the unaudited financial information to the City Council on a regular basis.
QUESTIONS BEFORE THE CITY COUNCIL:
1)Does the City Council have any questions regarding the attached 2nd Quarter Financial information?
2) Is the City Council comfortable approving the 2
nd Quarter Financial information for approval?
DISCUSSION:
As part of informing the City Council and community on the financial position of the City, staff prepared
budget to actual information for the General Fund and Utility Funds in the attachment.
This format more closely follows the City’s Comprehensive Annual Financial Report (CAFR) by providing
budget to actual figures and in similar revenue and expenditure/expense categories. This also aligns with
the updated budget worksheets the City Council will receive for the upcoming budget cycle.
FISCAL IMPACT:
N/A
RECOMMENDATION:
1)Motion to recommend approval of the 2nd Quarter Financial Statements which include the General
Fund and Utility Funds.
ATTACHMENTS:
1) 2
nd Quarter Financials – General Fund and Utility Funds
STAFF REPORT
DATE: August 1, 2017
CONSENT
MOTION
TO: City Council
FROM: Kristina Handt, City Administrator
AGENDA ITEM: Local 49ers Collective Bargaining Agreement 2017-2019
REVIEWED BY: Julie Johnson, City Clerk
BACKGROUND:
In March 2016, the permanent, non-exempt public works employees voted to join the Local 49ers. The
bargaining unit covered all public works operators levels III-I. In April 2016 the Council appointed
Mayor Pearson and Council Member Fliflet to assist staff with labor negotiations. Staff met with the
Mayor and Council member Fliflet early in the process to gain their perspective. Multiple meetings then
occurred between union representatives and staff with a couple of closed sessions held by Council. In
May and July, the City and union entered into mediation. At the second mediation meeting on July 11th, a
tentative agreement was reached. The public works bargaining unit voted to approve the agreement in
late July.
ISSUE FOR DISCUSSION:
Should Council approve the 2017-2019 Labor Agreement with the Local 49ers?
PROPOSAL DETAILS/ANALYSIS:
The 2017-2019 contract documents the parties’ agreements related to wages and other working conditions
and lays out the process for addressing disputes.
The funeral leave section is similar to the current employee handbook policy with the addition of step
relations.
Discipline is for just cause and may include oral, written reprimands, suspension, demotion or discharge.
At the request of the employee, the oral and written reprimands may be removed after 5 years if there is
no further disciplinary action.
Professional development and extended illness bank are similar to current policy.
Under the PTO section a level was added for 25+ years at 10 hours bi weekly. Furthermore, any amount
above the 240 annual cap may be converted to the Minnesota State Retirement System (MSRS). Council
will need to pass a separate resolution with specific language from the state department before this is
implemented.
Beginning 1/1/18, all bargaining unit employees will transfer to the union health insurance plan and
contribute 15% towards the monthly premium.
Life insurance and disability remain the same as current policy.
Columbus Day was added to the official holidays list.
Hours of work are Monday through Friday, 40 hours. The City may change the schedule by providing a
7-day notice. Hours worked in excess of that normal work shift including holidays would be
compensated at time and a half. The comp time max accrual has been increased to 40 hours.
Article 20 covers the on call pay provisions for weekdays, weekends and holidays.
Call back and right to subcontract provisions remain similar to current policy.
Bargaining employees will be provided with a city issued cell phone, uniforms, and other gear. An
annual reimbursement of $175 for boots is also included.
Article 29 addresses wages. The City will keep its current format of Public Works Operator III to I
levels. For the recently added Lead Worker position a probationary and full standing wage were
established. Employees would be eligible for a change in classification after meeting the licensing and
certification requirements in the job descriptions for each level. In an MOU, the City further agreed not to
change those requirements prior to 12/31/18. If the City does change them, a 120-day notice is required
in the contract.
Employees have the right to participate in the Central Pension Fund. Those details are further covered in
an MOU. The bargaining unit would have to vote to participate in this. It is funded from paycheck
deductions so there is no fiscal impact to the city.
The last MOU addresses red circling of some employees. The three employees identified had already
been grandfathered into their position so the MOU states that they would not lose their current standing if
the requirements for those levels changed in the future.
FISCAL IMPACT:
The impact to the 2017 budget will be an additional $10,100 in wages, payroll taxes and PERA. The
increase in the 2018 budget will be about $60,000 in those categories. The increase then to the 2019
budget would be about $23,500 in those categories.
The 2017 impact was reduced significantly due to changes in employees, vacancies in positions and
delays in filling the new position from what was proposed in the 2017 budget. The impact for 2018
assumes no changes in employees, vacancies in positions or newly created positions.
OPTIONS:
1) Approve the 2017-2019 Labor Agreement between the City of Lake Elmo and the International
Union of Operating Engineers Local 49
2) Amend and then Approve the 2017-2019 Labor Agreement between the City of Lake Elmo and
the International Union of Operating Engineers Local 49
3) Do not approve the 2017-2019 Labor Agreement and direct someone else to negotiate with the
union.
RECOMMENDATION:
If removed from the consent agenda:
Motion to approve the 2017-2019 Labor Agreement between the City of Lake Elmo and the
International Union of Operating Engineers Local 49
ATTACHMENTS:
• 2017-2019 Labor Agreement
• MOU Licenses and Certifications
• MOU Central Pension Fund
• MOU Red Circling
1
LABOR AGREEMENT
BETWEEN THE
CITY OF LAKE ELMO
-AND-
INTERNATIONAL UNION OF OPERATING ENGINEERS
LOCAL No. 49
AFL-CIO
January 1, 2017 through December 31, 2019
Tentative Agreement 7.11.17
2
ARTICLE 1 Purpose of Agreement 3
ARTICLE 2 Definitions 3
ARTICLE 3 Recognition 4
ARTICLE 4 Union Security 4
ARTICLE 5 Employer Security 5
ARTICLE 6 Employer Authority 5
ARTICLE 7 Grievance Procedure 6
ARTICLE 8 Savings Clause 8
ARTICLE 9 Leaves of Absence 9
ARTICLE 10 Discipline 9
ARTICLE 11 Professional Development 9
ARTICLE 12 Extended Illness Bank 10
ARTICLE 13 PTO 10
ARTICLE 14 Health Benefits 11
ARTICLE 15 Life Insurance 11
ARTICLE 16 Disability Insurance 11
ARTICLE 17 Holidays 11
ARTICLE 18 Hours of Work 12
ARTICLE 19 Overtime Pay 12
ARTICLE 20 On Call 13
ARTICLE 21 Call Back 13
ARTICLE 22 Right to Subcontract 13
ARTICLE 23 Uniforms/Boots/Safety/Cell Phone Allowance 13
ARTICLE 24 Layoff and Recall 14
ARTICLE 25 Probationary Period 14
ARTICLE 26 Job Posting 14
ARTICLE 27 Safety 15
ARTICLE 28 Severance 15
ARTICLE 29 Wages 15
ARTICLE 30 Retirement Insurance 16
ARTICLE 31 Waiver 16
ARTICLE 32 Duration 17
MOU – Central Pension Fund
MOU- Job Requirement Changes
3
ARTICLE 1-PURPOSE OF AGREEMENT
This AGREEMENT is entered into between the City of Lake Elmo, hereinafter called the
EMPLOYER, and Local No. 49, International Union of Operating Engineers, hereinafter
called the UNION. The intent and purpose of this AGREEMENT is to:
1.1 Establish and memorialize the parties’ agreement concerning wages and other terms
and conditions of employment for the duration of such agreements;
1.2 Establish procedures for the resolution of disputes concerning the interpretation and/or
application of this written Agreement.
ARTICLE 2-DEFINITIONS
2.1 DAYS: Calendar Days excluding Saturdays, Sundays and Recognized holidays.
2.2 UNION: The International Union of Operating Engineers, Local No. 49, AFL -CIO.
2.3 EMPLOYER: The individual municipality designated by this AGREEMENT is the CITY
OF LAKE ELMO.
2.4 UNION MEMBER: A member of the International Union of Operating Engineers,
Local No. 49.
2.5 EMPLOYEE: A member of the exclusively recognized bargaining unit.
2.6 BASE PAY RATE: The Employee’s hourly pay rate exclusive of any other special
allowances.
2.7 SENIORITY: Length of continuous service with the EMPLOYER.
2.8 SEVERANCE PAY: Payment made to an Employee upon honorable termination of
employment.
2.9 CALL BACK: Return of an Employee to a specified work site to perform assigned
duties at the express authorization of the EMPLOYER at a time other than the normal work
day. An extension of or early report to an assigned shift is not a call back .
4
2.10 On-Call: Periods of time when an employee is not scheduled to work but must
remain available to work.
2.11 STRIKE: Concerted action in failing to report for duty, the willful absence from one’s
position, the stoppage of work, slowdown, or abstinence in whole or in part from the full,
faithful and proper performance of the duties of employment for the purpose o f inducing,
influencing, or coercing a change in the conditions or compensation or the rights, privileges or
obligations of employment.
2.12 GRIEVANCE: A dispute between the parties as to the application or interpretation of
this agreement. Such procedures for filing a grievance are outlined in Article 6.
2.13 IMMEDIATE FAMILY: The employee’s spouse, and the children, grandchildren, parents,
grandparents, brothers and sisters, of the employee and the employee’s spouse, including all step
relations.
2.14 WORK WEEK: For the purposes of this agreement the normal work week shall be forty (40)
hours Monday through Friday.
ARTICLE 3-RECOGNITION
3.1 The EMPLOYER recognizes the UNION as the exclusive representative for all
employees of the Lake Elmo Street, Water & Sewer, and Park & Recreation employees, who
work more than 14 hours per week, or, thirty five (35) percent of the normal work week, and
more than 67 working days per year, excluding the Director of the Public Works, Clerical,
Supervisory, and Administrative Personnel.
3.2 In the event the EMPLOYER and the UNION are unable to agree as to the inclusion or
exclusion of a new or modified job class, the issue shall be submitted to the bureau of mediation
services for determination.
ARTICLE 4 – UNION SECURITY
All employees who have completed thirty-one (31) calendar days of employment shall become
members of the Union and shall maintain their membership in good standing. “In good
standing,” for the purpose of this Agreement, is defined as to mean the payment of a standard
initiation fee and standard regular monthly dues uniformly required as a condition of acquiring or
retaining membership in the Union.
In recognition of the UNION as the exclusive representative the EMPLOYER shall:
4.1 Deduct each payroll period an amount sufficient to provide the payment of dues
established by the UNION from the wages of all employees authorizing in writing such
deduction, or as allowed for fair share dues and representation as provided for under PELRA,
and
5
4.2 Remit such deduction to the appropriate designated officer of the UNION.
4.3 The UNION may designate certain employees from the bargaining unit to act as stewards
and shall inform the EMPLOYER in writing of such choice.
4.4 The UNION agrees to indemnify and hold the EMPLOYER harmless against any and all
claims, suits, orders or judgments brought or issued against the City as a result of any action
taken or not taken by the City under the provisions of this Article.
ARTICLE 5-EMPLOYER SECUIRTY
5.1 The UNION agrees that during the life of this AGREEMENT it will not cause, encourage,
participate in or support any strike, slow down, other interruption of or interference with the
normal functions of the EMPLOYER.
5.2 Any employee who engages in a strike may have their appointment terminated by the
EMPLOYER effective the date the violation first occurs. Such termination shall be effective upon
written notice served upon the employee.
5.3 An employee who is absent from any portion of the employee’s work assignment without
permission, or who abstains wholly or in part from the full performance of the employee’s duties
without permission from the employee’s EMPLOYER on the date or dates when a strike occurs
is prima facie presumed to have engaged in a strike on such date or dates.
5.4 An employee who knowingly strikes and whose employment has been terminated for such
action may, subsequent to such violation, be appointed or re-appointed or employed or re-
employed, but the employee shall be on probation for two years with respect to such civil service
status, tenure of employment, or contract of employment, as the employee may have theretofore
been entitled.
5.5 No employee shall be entitled to any daily pay, wages or per diem for the days on which the
employee engaged in a strike
ARTICLE 6-EMPLOYER AUTHORITY
6.1 The EMPLOYER retains the full and unrestricted right to operate and manage all
manpower, facilities, and equipment; to establish functions and programs; to set and amend
budgets; to determine the utilization of technology; to establish and modify the organizational
structure; to select, direct and determine the number of personnel; to establish work
schedules; and to perform any inherent managerial function not specifically limited by this
AGREEMENT.
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6.2 Any term and condition of employment not specifically established or modified by the
AGREEMENT shall remain solely within the discretion of the EMPLOYER to modify,
establish, or eliminate.
ARTICLE 7-GRIEVANCE PROCEDURE
Section A. A grievance is defined as any dispute or disagreement between an employee and
the City as to the interpretation or application of this agreement and shall not include any
dispute or disagreement regarding proposed changes in the terms and conditions of this
agreement, nor shall a grievance extend to matters of inherent managerial policy, the overall
budget of the City, utilization of technology, the organizational structure or selection, direction
and number of personnel.
Section B. A grievance shall not be valid for consideration unless the grievance is submitted
in writing within twenty (20) days after the grievance arose. Failure to file any grievance within
such period shall be deemed a waiver thereof.
Section C. The employee and the City shall attempt to adjust all grievances which may
arise during the course of employment in the following manner:
Subd. 1. An effort shall first be made to resolve the grievance informally between
the employee and supervisor. If the grievance cannot be resolved through
informal discussion, then the grievance shall be submitted in writing to the
supervisor setting forth the facts and the specific provisions of the
Agreement allegedly violated. The supervisor or his/her designee will give
his/her written decision on the grievance within ten (10) days after receipt
of the written grievance.
Subd. 2. In the event that the grievance is not resolved in Subd. 1, the decision
rendered in Subd. 1 may be appealed to the City Administrator provided
such appeal is made in writing and appealed to the City Administrator
within five (5) days after receipt of the decision in Subd. 1. The City
Administrator or his/her designee shall set a time to meet with the
employee within fifteen (15) days after receipt of the appeal. Within ten
(10) days after the meeting, the City Administrator or his/her designee
shall issue a decision in writing.
Subd. 3. In the event that the grievance is not resolved in Subd. 2, the decision
rendered in Subd. 2 may be appealed to the City Council within five (5)
days after receipt of the decision in Subd. 2. Said City Council shall
consider such grievance at a meeting called within fifteen (15) days after
said appeal is filed with the City Clerk.
Subd. 4. A grievance unresolved in Subd. 3 and appealed in Subd. 4, shall be
submitted to the Minnesota Bureau of Mediation Services. A grievance
not resolved in Subd. 4 may be appealed to Section F within fifteen (15)
days following the EMPLOYER’S final answer in Subd. 4 . Any grievance
7
not appealed in writing to Section F by the UNION within fifteen (15) days,
shall be considered waived.
Subd. 5. The employee in each of the above subdivisions may be accompanied by
and represented by a person designated by him/her.
Section D. Failure by the employee to appeal a grievance from one (1) subdivision to another
within the time periods provided; therein, shall be deemed a waiver of the grievance. In
computing time in the foregoing procedure, the word “day” shall constitut e calendar days.
Section E. Failure by the City Council or the City employees to issue a decision within the
time period provided herein shall constitute a denial of the grievance.
Section F. Arbitration Procedure: In the event that the employee and the City are unable
to resolve any grievance as defined in Section A herein, the grievance may be submitted to
binding arbitration.
Subd. 1. A request to submit a grievance to arbitration must be in writing, signed by
the aggrieved party, and such request must be filed in the office of the City
Clerk within ten (10) days following the decision in Subd. 4 of the grievance
procedure.
Subd. 2. No grievance shall be considered by the arbitrator which has not first been
duly processed in accordance with the grievance procedure and appeal
provisions outlined in this procedure.
Subd. 3. The grievance shall be heard by a single arbitrator and both parties may
be represented by such person or persons as they may choose and
designate, and the parties shall have the right to a hearing at which time
both parties will have the opportunity to submit evidence, offer testimony,
and make oral or written arguments relating to the issues before the
arbitrator.
Subd. 4. Decisions by the arbitrator in cases properly before him/her shall be final
and binding upon the parties.
Subd. 5. Each party shall bear its own expenses in connection with the arbitration,
including expenses relating to the party’s representatives, witnesses, and
any other expenses which the party incurs in connection with presenting
its case in arbitration. A transcript shall be made of the hearing. The
parties shall share equally fees and expenses of the arbitrator, the cost of
the transcript, and any other expenses which the parties mutually agree
are necessary for the conduction of the arbitration.
Subd. 6. The arbitrator shall have jurisdiction over disputes or disagreements
relating to matters properly before the arbitrator pursuant to the terms of
this procedure. The jurisdiction of the arbitrator shall not extend to the
proposed changes in terms and conditions of employment as defined
8
herein and contained in a written agreement or memorandum of
agreement as agreed to by the parties; nor shall an arbitrator have
jurisdiction over any matter which has not been submitted to arbitration in
compliance with the terms of the grievance and arbitration procedure as
outlined herein; nor shall the jurisdiction of the arbitrator extend to matters
of inherent managerial policy, which shall include but are not l imited to
such areas of discretion or policy as the functions and programs of the
Employer, its overall budget, utilization of technology, the organizational
structure and selection and direction and number of personnel.
Subd. 7. Upon the proper submission of a grievance under the terms of this
procedure, the parties shall, within fifteen (15) days after the submission,
attempt to agree upon the selection of an arbitrator. If no agreement is
reached within fifteen (15) days, the parties may individually or jointly
request the Bureau of Mediation Services to appoint an arbitrator,
requesting that said appointment be made within thirty (30) days after the
receipt of said request.
7.1 Waiver
If a grievance is not presented within the time limits set forth above, it shall be considered
“waived”. If a grievance is not appealed to the next step within the specified time limit
or any agreed extension thereof, it shall be considered settled on the basis of the
EMPLOYER’S last answer. If the EMPLOYER does not a nswer a grievance or an
appeal thereof within the specified time limits, the UNION may elect to treat the
grievance as denied at that step and immediately appeal the grievance to the next step.
The time limit in each step may be extended by mutual agreeme nt of the EMPLOYER
and the UNION.
7.2 Choice of Remedy
If a grievance involves the suspension, demotion or discharge of an Employee who has
completed the required probationary period, and the Employee has rights under the
Minnesota Veterans Preference Act (VPA), the grievance may be appealed either pursuing
arbitration under this Agreement or by requesting a hearing under the VPA. If the Employee
appeals under the VPA or pursuant to some other applicable employment law, the grievance
is not subject to the arbitration procedure and the Employee shall have waived the right to
arbitrate pursuant to this Agreement.
ARTICLE 8 SAVINGS CLAUSE
8.1 This Agreement is subject to the laws of the State of Minnesota, the United States of
America, and the signed municipality. In the event any provision of this Agreement shall be held
contrary to law by a court of competent jurisdiction from whose final judgment or decree no appeal
has been taken within the time provided, such provision shall be voided. All other provisions
shall continue in full force and effect.
ARTICLE 9-LEAVES OF ABSENCE
9
9.1 Funeral leave shall be granted to full-time Employees as follows:
An employee will be granted a maximum of three (3) working days funeral leave with pay in
the event of a death in the employee’s immediate family, One (1) paid day for funeral leave
will be granted for family not defined as immediate family. Additional days for funeral leave
may be granted at the discretion of the Public Works Director for extenuating and unusual
circumstances, which additional time may be charged against the employee’s PTO time.
9.2 Funeral Leave will be at the Employee’s regular rate of pay. Upon approval of the
supervisor, the Employee may choose to use PTO to extend the funeral leave. The
authorized supervisor may determine the length of leave for any case not meeting the above
guidelines.
9.3 All other leaves will be in accordance with Minnesota State Statute Chapter 181.
ARTICLE 10-DISCIPLINE
10.1 The EMPLOYER shall have the right to impose disciplinary actions on employees for just
cause only.
a. oral reprimand;
b. written reprimand;
c. suspension'
d. demotion; or
e. discharge
10.2 Written reprimands, notices of suspension, notices of demotion and notices of discharge
which are to become part of an Employee's personnel file shall be presented in written form read
and acknowledged by signature of the Employee. The Employee and Union will receive a copy of
such reprimands and/or notices at the time of implementation. At the request of the Employee,
oral and written reprimands shall be removed from the file after five (5) years provided the
Employee has not been involved in disciplinary action.
10.3 Employees may examine their own individual personnel files at reasonable times under the
direct supervision of the EMPLOYER.
10.4 Employees will not be questioned concerning an investigation that may lead to disciplinary
action unless the employee has been given the opportunity to have a Union representative of their
choice present at such questioning.
ARTICLE 11-PROFESSIONAL DEVELOPMENT
10
11.1 When an employee’s attendance at training or educational sessions is directed by
the City, such attendance will be without loss of pay. Such attendance will include reasonable
reimbursement for travel, lodging, and/or program expenses, provided such expenses are
approved in advance by the City Administrator or Public Works Director.
ARTICLE 12- EXTENDED ILLNESS BANK
12.1 All accrued, but unused, Sick Leave banks of City employees as of January 1, 2004 were
converted to Extended Illness Banks. An employee’s Extended Illness Bank balance may be
utilized only for illness or injury, as certified by a physician’s statement; and, only after an
employee has used ten (10) days of Paid Time Off.
12.2 Under no circumstances can an employee receive both Extended Illness Bank balances
and Worker’s Compensation benefits for the same period of disability, except if the employee
elects to receive Worker’s Compensation benefits, he/she may also use Extended Illness Bank
balances, subject to other related Policy, to the extent necessary to increase their income to their
net wage prior to the injury or onset of the disease.
ARTICLE 13-PTO
13.1 Accrual rates: All full time and all part time employees shall receive PTO benefits
which shall be paid at their regular rate of compensation and may be used in a minimum of
thirty (30) minute increments. PTO may be used as it is earned, pursuant to the following
schedule:
Upon
completion
Of:
Monthly Accrual Rate
0-5 years 5 hours bi-weekly
6-10 years 6.5 hours bi-weekly
11-15 years 8 hours bi-weekly
16-24 years 9.5 hours bi-weekly
25 + 10 hours bi-weekly
Employees with 20 or more years of completed service as of January 1, 2004, shall accrue
Personal Time Off at a rate of eleven (11) hours bi-weekly.
13 .2 No more than two hundred forty (240) hours of PTO may be carried over into the
following year. Any amount above the maximum two hundred forty (240) hours shall be
converted to a contribution to MSRS. Such conversion shall be capped at forty (40) hours
11
accumulation per year. The conversion shall take place once a year in the second week in
December.
ARTICLE 1 4-HEALTH BENEFITS
Effective 1/1/2018 The Employer agrees to make monthly contributions to the Health and
Welfare Fund and will execute a separate participation agreement regarding those
contributions. The Empl oyer will provide to all full time employees, Local 49’s Bargaining
Premium Health Insurance at the rate set forth by the fund trustees, with the employee
responsible for paying fifteen percent (15%) towards the cost of the premium.
ARTICLE 1 5-LIFE INSURANCE
The Employer will purchase and maintain at its expense, a Term Life insurance policy in the
amount of $25,000 for each employee.
ARTICLE 1 6-DISIBILITY INSURANCE
The Employer will provide at its expense, long and short term disability insurance for each
employee. Except as otherwise prohibited by law, this policy will in no way affect or be
affected by the employee's Worker's Compensation benefits.
ARTICLE 17- HOLIDAYS
17.1 Holidays are defined as:
1. New Year’s January 1
2. Martin Luther King Day Third Monday in January
3. President’s Day Third Monday in February
4. Memorial Day Last Monday in May
5. Independence Day July 4
6. Labor Day First Monday in September
7. Columbus Day Second Monday in October
8. Veteran’s Day November 11
9. Thanksgiving Day Fourth Thursday in November
10. Day after Thanksgiving Fourth Friday in November
11. Christmas Eve December 24
12. Christmas Day December 25
12
17.2 Holidays occurring on Saturday will be observed the preceding Friday and holidays
occurring on Sunday will be observed on the following Monday, Employees shall receive eight (8)
hours of pay at their regular hourly rate for all recognized holidays.
17.3 When business emergencies arise, Non-exempt hourly employees required to work on a
recognized holiday will be paid at one and one-half (1 ½) times their regular base rate of pay, in
addition to their regular holiday pay. Compensatory time-off may be taken in lieu of payment.
ARTICLE 18-HOURS OF WORK
18.1 The normal work week shall be forty (40) hours, Monday through Friday.
18.2 In the event that work is required because of unusual circumstances such as fire,
flood, snow, sleet, Sewer/water and street emergencies, the employer reserves the right
to adjust employee's work hours to best serve the public; no advance notice need be
given as required in 18.4.
18.3 Employees are entitled to two (2) paid fifteen-minute rest breaks and an unpaid thirty
(30) minute meal break for each normal work day.
18.4 Service to the public may require the establishment of regular shifts for some employees
on a daily, weekly, seasonal, or annual basis other than the normal work day. Service to the
public requires the establishment of regular workweeks that schedule work on Saturdays
and/or Sundays. The Employer shall give seven (7) calendar days advance notice to the
Employees affected by the establishment of the work days different from the Employee’s
normal work day. The employer need not give seven (7) day notice for annual clean up days.
ARTICLE 19–OVERTIME PAY
19.1 Hours worked in excess of the normal work shift, shall be compensated for at one and
one-half (1-½) times the Employee’s regular base pay rate, or at discretion of employee,
compensatory time off at the rate of one and one -half (1-½) hours off for each hour of overtime
worked.
19.2 For the purpose of calculating overtime compensation, overtime hours worked shall not
be pyramided, compounded, or paid twice for the same hours worked.
19.3 Employees may earn compensatory time at the rate of one and one half (1 ½) times in
lieu of overtime pay, upon mutual agreement between the employee and the Employer, not to
exceed forty (40) hours with a maximum annual carry over of forty (40) hours. As of the last
pay period in November of each year, all accumulated compensatory time above the
maximum carry over amount of forty (40) hours shall be paid to the employee.
13
19.4 For purposes of calculating overtime, hours worked shall be defined as those hours
actually worked or accounted for by holidays in one workweek. Workers Compensation will
not apply as hours worked for purposes of calculating overtime.
ARTICLE 20- ON CALL
a. Local 49 members scheduled to be on-call; on weekends shall be compensated four
(4) hours at one and a half (1 ½) times their regular rate for the period beginning the
end of the work day on Friday and ending the start of the work day on Monday.
b. Local 49 members scheduled to be on-call weekdays (Monday through Thursday)
shall be compensated one (1) hour for each work day served at one and one half (1
½) times the regular rate.
c. Local 49 members scheduled to be on-call during a holiday will receive two and one
half (2 ½ ) hours at one and a half (1 ½) time their regular pay.
d. The member scheduled for on call shall be provided with the dedicated on-call cell
phone. All on-call employees will be required to be work ready when on call, and
must be within close proximity to the City so that they can answer emergency calls.
e. Local 49 members shall have the right to switch on-call schedules with one another
provided they communicate said change with their immediate supervisor.
f. The Director of Public Works and the bargaining unit will make up the schedule to
be on-call on weekends, week days, and Holidays with the final approval by the
Director of Public Works. All employees are required to participate in the on -call
schedule once approved by the Director of Public Works.
g. Such on-call pay shall be in addition to other compensation which the Employee is
entitled to under this Agreement. Any time spent on-call will not count towards hours
worked for purposes of calculating overtime, unless such Employee was actually
called to answer and/or respond to a call.
ARTICLE 21-CALL BACK
Employees called to work at a time other than their normal scheduled shift, shall be paid a
minimum of two (2) hours at one and one-half (1 ½) times their regular rate of pay.
ARTICLE 22-RIGHT TO SUBCONTRACT
Nothing in this AGREEMENT shall prohibit or restrict the right of the EMPLOYER from
subcontracting work performed by employees covered by this AGREEMENT.
ARTICLE 23- UNIFORMS/BOOTS/SAFETY/CELL PHONE ALLOWANCE
23.1 The Employer will provide initial uniforms, winter clothing, rain gear and the necessary
safety equipment for full-time employees according to the reasonableness and necessity in
14
the performance of their job. The Employer agrees to supply and maintain work uniforms for
bargaining unit members.
23.2 The Employer agrees to provide to all full time employees a city issued cell phone.
Employees shall take steps not to lose or damage the cell phone. The Employer will provide
an allowance in the amount of one hundred seventy five dollars ($175.00) per year towards
the purchase of safety boots.
ARTICLE 24- LAYOFF AND RECALL
24.1 In case of the need to eliminate positions, employees will be laid off based on inverse
seniority within their job classification when all job relevant qualification factors are equal.
Employees will be given a minimum of fourteen (14) days advance notice prior to layoff.
24.2 Employees will be recalled from layoff based on seniority within their job classification when
all job relevant qualification factors are equal. Notice of recall shall be sent to the laid off
employee's last known address by registered/certified mail. Employees will be given seven (7)
days after receipt of recall notice to inform the employer of their intent to return to work. Failure to
respond within the seven (7) day period will terminate recall rights.
ARTICLE 25 PROBATIONARY PERIOD
25.1 All newly hired or rehired employees will serve a six (6) month probationary period.
25.2 At any time during the probationary period a newly hired or rehired employee may be
terminated at the sole discretion of the Employer.
25.3 All employees will serve a six (6) month probationary period in any job classification in
which the employee has not served a probationary period.
25.4 At any time during the probationary period a promoted or reassigned employee may be
demoted or reassigned to the employee’s previous position at the sole discretion of the
Employer.
ARTICLE 26- JOB POSTING
26.1 The Employer and the Union agree that permanent job vacancies within the designated
bargaining unit shall be filled based on the concept of promotion from within provided that
applicants:
Have the necessary qualifications to meet the standards of the job vacancy; and
Have the ability to perform the duties and responsibilities of the job vacancy.
15
26.2 Employees filling a higher job class based on the provisions of this ARTICLE shall be
subject to the conditions of ARTICLE 25 (PROBATIONARY PERIODS).
26.3 The EMPLOYER has the right of final decision in the selection of employees to fill
posted jobs based on qualifications, abilities and experience.
Job vacancies within the designated bargaining unit will be posted for five (5) working days
so that members of the bargaining unit can be considered for such vacancies.
ARTICLE 27- SAFETY
The Employer and the Union agree to jointly promote safe and healthful working conditions,
to cooperate in safety matters and to encourage employees to work in a safe manner.
ARTICLE 28- SEVERANCE
28.1 Full-time employees will be paid severance pay as follows:
28.2 Employees who leave the employment of the City by Retirement, Death, Disability or
Resignation will receive pay for unused and or accrued PTO and any compensatory time
accumulated as provided by this agreement. Employees shall have the option of directing
those dollars into a 457 deferred compensation plan (subject to IRS regulations and
Minnesota law) or (MSRS resolution).
ARTICLE 29- WAGES
Employees will be evaluated by their supervisor annually consistent with the Public Works
Operator Level III-I or Lead Worker job description. A personal review of the evaluation will
be required between the employee and the employee’s supervisor. The employee will
complete a self-evaluation prior to the review with the supervisor. All employees will be
eligible for an increase noted below provided the employee meets the job performance
criteria as outlined in the job description and with a satisfactory performance evaluat ion. The
employer shall give the employees a one hundred and twenty (120) day notice of any
changes to the job requirements.
16
ARTICLE 30 – RETIREMENT INSURANCE
Employees have the ability to participate in the Central Pension Fund.
(By MEMORANDUM OF UNDERSTANDING)
ARTICLE 31 - WAIVER
31.1 Any and all prior agreements, resolutions, practices, policies, rules and regulations
regarding terms and conditions of employment, to the extent inconsistent with the provisions
of this AGREEMENT, are hereby superseded.
31.2 The parties mutually acknowledge that during the negotiations which resulted in this
AGREEMENT, each had the unlimited right and opportunity to make demands and proposals
with respect to any term or condition of employment not removed by law from bargaining. All
agreements and understandings arrived at by the parties are set forth in this AGREEMENT
for the stipulated duration of this AGREEMENT. The EMPLOYER and the UNION each
voluntarily and unqualifiedly waives the right to meet and negotiate regarding any and all
terms and conditions of employment referred to or covered in this AGREEMENT or with
respect to any term or condition of employment not specifically referred to or covered by this
AGREEMENT, even though such terms or conditions may not have been within the
knowledge or contemplation of either or both parties at the time this contract was negotiated
or executed.
1/1/17 1/1/18 1/1/19
PW Operator III
(Probationary)
$22.70 $23.27 $23.97
PW Operator III (Full
Standing.)
$24.13 $24.73 $25.47
PW Operator II
$25.62 $26.26 $27.05
PW Operator I
$27.18 $27.86 $28.70
Lead Worker
(Probationary)
$29.64 $30.38 $31.29
Lead Worker (Full
Standing)
$30.54 $31.30 $32.24
17
ARTICLE 32– DURATION
This AGREEMENT shall be effective as of January 1, 2017, and shall remain in full force and
effect until December 31, 2019.
FOR THE CITY OF LAKE ELMO: FOR I.U.O.E. LOCAL NO. 49:
____________________________ __________________________
Business Manager
____________________________ __________________________
Business Representative
__________________________
Steward
MEMORANDUM OF UNDERSTANDING
Licenses/Certificates
City of Lake Elmo
This Memorandum of Understanding is entered into between the two parties (City of Lake Elmo and
Local 49) in order to address the date when new job certifications/licenses will become effective, as they
pertain to progressing to higher classifications in the collective bargaining agreement.
The following Licenses/Certifications will remain in effect until 12.31.2018.:
PWIII: This position will require the acquisition and maintenance of the following additional
certificates/licenses within 2 years of appointment:
Class A Commercial Driver’s License with air brakes and tanker endorsement
Class D Water Operator License
Class D/SD Waster Water Operator License
Annual OSHA Training including relevant competent person certificate and HAZMAT
certifications
PWII: This position requires the following requires the following additional certificates/licenses:
Class C Water Operator License
NIMS 100 and 700
PWI: This position requires the following additional certificates/licenses:
Class S/SC Waste Water Operator License
Completion of 2 of the following 4 programs:
o Certified Playground Inspector Certificate
o Tree Inspector Certificate
o Management and Supervisory Leadership Training Program
o LTAP’s Road Scholar Program
_________________________________ _____________________________
Employer: Ron Boesel, Business Representative
_________________________________ _____________________________
Date: Date:
MEMORANDUM OF UNDERSTANDING
Central Pension Fund
City of Lake Elmo
The purpose of this Memorandum of Understanding is to assist both Labor and Management in
identifying and implementing the Central Pension Fund (CPF) contribution rate.
1) The CPF is a supplemental Pension Fund authorized by Minnesota Statutes,§356.24,
subdivision 1(10).
2) The parties agree that the agreed upon amount that would otherwise be paid in salary or
wages will be contributed instead to the CPF as pre-tax employer contributions.
Contributions from the City will not be funded from any source other than this wage
reduction.
3) The Employer shall pay this contribution directly to the I.U.O.E. Central Pension Fund at
4115 Chesapeake Street NW, Washington, D.C. 20016.
4) For purposes of determining future wage rates, the Employer shall first restore the amount
of the wage reduction, which is currently the CPF contribution rate of $______ per hour,
then apply the applicable wage multiplier, then reduce the revised wage by the CPF
contribution rate.
5) For purposes of calculating overtime compensation the Employer shall first restore the
amount of the wage reduction ($./hr.) then apply the applicable 1.5 wage multiplier
required under the Fair Labor Standards Act and the collective bargaining agreement,
then pay the resulting amount for overtime worked.
6) A contribution of $2.40 per straight time hour worked prevents annual CPF contributions
for individual employees from exceeding $5,000.00 in a year and therefore complies with
limitations set forth under Minnesota Statute § 356.24, subd. 1(10) as amended.
7) The parties agree that the Public Employees Retirement Association interprets employer
contributions to the CPF as being included in determining "salary" for the purposes of
the public pension.
8) The CPF Plan of Benefits and the Agreement and Declaration of Trust will serve
as the governing documents.
9) Effective --17 the contribution rate equals $_____ for all hours worked.
10) Members, by majority vote, may change the contribution rate at any time during the life
of this agreement. The Union and the employer will work together to implement member
approved changes as soon as is practicable.
_________________________________ _____________________________
Employer: Ron Boesel, Business Representative
_________________________________ _____________________________
Date: Date:
MEMORANDUM OF UNDERSTANDING
Red Circling of Employees
City of Lake Elmo
This Memorandum of Understanding is entered into between the two parties (City of Lake Elmo
& Local 49) in order to address Red Circling of three employees. Red Circling is defined as to
mean immunity to requirements that other employees may need. The three employees shall not
be required to hold the certifications needed to progress through Public Works positions. The
three individuals are as follows:
1. Rick Gustafson (Public Works Operator 1)
2. Jamie Colemer (Lead Worker)
3. Jim Sachs (Public Works Operator 1)
Furthermore, this MOU shall survive in perpetuity until such time that either the employee
retires, quits, or is terminated for just cause.
_________________________________ _____________________________
Employer: Ron Boesel, Business Representative
_________________________________ _____________________________
Date: Date:
STAFF REPORT
DATE: August 1, 2017
CONSENT
MOTION
TO: City Council
FROM: Brian A. Swanson – Finance Director
AGENDA ITEM: Authorize RFP for Enterprise Resource Planning System (ERP)
REVIEWED BY: Kristina Handt – City Administrator
BACKGROUND:
At the July 13, 2017 Finance Committee meeting, discussion occurred regarding budget expenditures for
a new software package for finance and other city related business. Since the meeting, staff prepared a
Request for Proposals for Enterprise Resource Planning (ERP) System.
At the July 27, 2017 Finance Committee meeting, authorization was provided to move approval for the
Request for Proposals of the ERP system to be considered by the City Council.
QUESTIONS BEFORE THE CITY COUNCIL:
1) Does the City Council have any questions regarding the attached Request for Proposal?
2) Is the City Council comfortable recommending this move forward for approval?
DISCUSSION:
The City is planning to replace its current financial and information systems environment
with an ERP system. In doing so, the City seeks to address several challenges in the current
environment, including but not limited to:
Lack of functionality in current systems.
Limited online self-service functionality and payment options.
Limited reporting capabilities in current systems.
Lack of integration among systems.
Manual workflow processes.
City accounts receivable information is tracked in MS Excel.
Lack of budget forecasting capabilities.
Limited access to the existing system.
Need for more robust project tracking.
Time entry and approval is manual.
Current hardware is no longer supported.
In order to address these challenges and others, the City has initiated an enterprise-wide
project to adequately plan for, select, and implement an ERP system, as well as the
professional services activities to be a part of implementation.
The following table contains the list of functional areas of the desired ERP system.
Functional Areas
No. Functional Area
1 General Ledger and Financial Reporting
2 Budgeting
3 Accounts Payable
4 Accounts Receivable and Cash Receipts
5 Project Accounting
6 Capital Assets – (Optional)
7 Human Resources
8 Payroll
9 Special Assessments – (Optional)
10 Utility Billing – (Optional)
The City has identified an anticipated go -live date for core financials functionality of January 2,
2018. Below is the proposed schedule of dates, which is quite aggressive in order to meet the go -
live date.
Table 01: RFP Schedule of Events
Event Estimated Date
Request for Proposals Published August 2, 2017
Deadline for Proposal Submissions September 1, 2017
Short List Vendors notified September 6, 2017
Vendor Demonstrations September 13-14, 2017
Preferred Vendor Notified September 21, 2017
Begin Contract Negotiations October 4, 2017
FISCAL IMPACT:
The City has put a tentative budget amount in of $40,000 based on the upgrade costs for the existing
software and very preliminary estimates of replacing the system with a new product. This cost will vary
significantly based on the number of modules implemented, number of users, timeline and conversion of
data.
RECOMMENDATION:
1) Motion to recommend approval of the Request for Proposals for Software and Implementation
Services for an Enterprise Resource Planning (ERP) System.
ATTACHMENTS:
1) Request for Proposals for Software and Implementation Services for an Enterprise Resource
Planning (ERP) System
2) City of Lake Elmo ERP Worksheets – 4 tabs in the workbook
City of Lake Elmo, Minnesota
Request for Proposals:
Software and Implementation Services for
Enterprise Resource Planning (ERP) System
Issue Date: August 2, 2017
Response Due: September 1, 2017 at 4:00 pm Central Time
Receipt Location:
City of Lake Elmo
3800 Laverne Avenue North
Lake Elmo, Minnesota 55042
WARNING: There are two total files associated with this RFP package. Prospective proposers who have received
this document from a source other than the Issuing Office should immediately contact the Issuing Office and
provide their name and e-mailing address so that amendments to the RFP or other communications can be sent
to them. A prospective proposer who fails to notify the Issuing Office with this information assumes complete
responsibility in the event that they do not receive communications from the Issuing Office prior to the closing
date.
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page i
Software and Implementation Services for
Enterprise Resource Planning (ERP) System
Table of Contents
Section Page
1.0 RFP Introduction and Background ............................................................................ 5
1.1 Introduction .................................................................................................................................... 5
1.2 About Lake Elmo ........................................................................................................................... 5
1.3 Project Objectives .......................................................................................................................... 5
1.4 Definitions ...................................................................................................................................... 6
1.5 City’s Consulting Partner ............................................................................................................... 6
1.6 No Obligation ................................................................................................................................. 6
1.7 RFP Schedule of Events ............................................................................................................... 7
1.8 Pre-Qualification of Vendors ......................................................................................................... 7
1.9 Minimum Qualifications ................................................................................................................. 7
1.10 Partnerships .................................................................................................................................. 7
1.11 Incurred Expenses ......................................................................................................................... 7
1.12 Questions and Inquiries ................................................................................................................. 8
2.0 Project Scope ............................................................................................................. 9
2.1 Functional Areas. ........................................................................................................................... 9
2.2 City and Project Staffing ................................................................................................................ 9
2.3 Number of Users ........................................................................................................................... 9
2.4 Current City Applications Environment ........................................................................................ 10
2.5 Current City Technical Environment ............................................................................................ 10
2.6 Functional Area Statistics ............................................................................................................ 10
2.7 Gap-Fit Analysis .......................................................................................................................... 11
2.8 Implementation Project Plan........................................................................................................ 11
2.9 Requirements Traceability Matrix ................................................................................................ 11
2.10 Vendor Project Team Resource Management ............................................................................ 11
2.11 City Project Team Resource Management ................................................................................. 11
2.12 Software Customization Plan ...................................................................................................... 12
2.13 System Interface Plan ................................................................................................................. 12
2.14 Data Conversion Plan .................................................................................................................. 12
3.0 Proposal Evaluation and Award .............................................................................. 13
3.1 Evaluation Process ...................................................................................................................... 13
3.2 Evaluation Criteria ....................................................................................................................... 13
3.3 Best and Final Offer/Request for Clarification ............................................................................. 13
3.4 Notice of Intent Award ................................................................................................................. 14
3.5 Negotiations and Contract Execution .......................................................................................... 14
4.0 Submittal Response Format .................................................................................... 15
4.1 General Instructions .................................................................................................................... 15
4.2 Transmittal Letter and Executive Summary ................................................................................ 15
4.3 Project Approach and Software Solution ..................................................................................... 16
4.4 Implementation Methodology ...................................................................................................... 16
4.5 Company Background and History .............................................................................................. 16
4.6 Key Proposed Personnel and Team Organization ...................................................................... 16
4.7 Project Roles and Responsibilities .............................................................................................. 17
4.8 Project Schedule ......................................................................................................................... 17
4.9 Functional and Technical Requirements Response .................................................................... 17
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page ii
4.10 Data Conversion Plan .................................................................................................................. 17
4.11 Deliverables Dictionary ................................................................................................................ 17
4.12 Sub-Contracting ........................................................................................................................... 17
4.13 References .................................................................................................................................. 18
4.14 Site Visit References ................................................................................................................... 18
4.15 Response to Narrative Questions ............................................................................................... 19
5.0 Contract Terms and Conditions .............................................................................. 20
5.1 Contract Type .............................................................................................................................. 20
5.2 Contract Term .............................................................................................................................. 20
5.3 Contract Review .......................................................................................................................... 20
5.4 Contract Changes. ....................................................................................................................... 20
5.5 Contract Approval ........................................................................................................................ 20
5.6 Contract Dispute .......................................................................................................................... 20
5.7 Payment and Retainages ............................................................................................................ 21
5.8 Taxes and Taxpayer Information ................................................................................................. 22
5.9 Federal Requirements ................................................................................................................. 22
5.10 Confidential Information............................................................................................................... 22
5.11 City Property ................................................................................................................................ 22
5.12 Warranty ...................................................................................................................................... 23
5.13 Source Code ................................................................................................................................ 23
5.14 Insurance Requirements ............................................................................................................. 23
5.15 Conflict of Interest ........................................................................................................................ 24
5.16 Pending and Recent Litigation .................................................................................................... 24
5.17 Proposer’s Certification ............................................................................................................... 24
5.18 Offer Held Firm ............................................................................................................................ 24
5.19 Amendment/Withdrawal of Proposals ......................................................................................... 24
5.20 Alternate Proposals ..................................................................................................................... 24
5.21 Sub Contractors. .......................................................................................................................... 24
5.22 Joint Ventures .............................................................................................................................. 25
5.23 Right of Rejection ........................................................................................................................ 25
5.24 Clarification of Proposals ............................................................................................................. 25
5.25 Rights to Submitted Material ....................................................................................................... 25
5.26 Protests ...................................................................................................................................... 26
5.27 Public Information......................................................................... ………………………………...26
5.28 Contract Negotiation .................................................................................................................... 26
5.29 Failure to Negotiate ..................................................................................................................... 26
5.30 Hold Harmless ............................................................................................................................. 26
5.31 Protection of Resident Workers ................................................................................................... 26
5.32 Statutory Information ................................................................................................................... 26
5.33 Assignment or Subcontract ......................................................................................................... 26
5.34 Non-Discrimination Clause .......................................................................................................... 27
5.35 ADA ............................................................................................................................................. 27
5.36 Audit ............................................................................................................................................ 27
5.37 Laws ............................................................................................................................................ 27
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page iv
ADVERTISEMENT FOR PROPOSALS-ENTERPRISE RESOURCE PLANNING (ERP) SYSTEM AND
IMPLEMENTATION SERVICES
The City of Lake Elmo, Minnesota seeks proposals from qualified vendors for an Enterprise Resource
Planning (ERP) system as well as system implementation services. The scope of this request will
include, but is not limited to an implementation project plan, implementation methodology,
communication plan, project change management plan, software customization plan, system interface
plan, data conversion plan, implementation testing plan, quality assurance plan, pre- and post-
implementation support plan, and a training plan. The proposer shall also provide project management
resources leading to the successful implementation of the system.
Criteria for selection is based on price, experience, level of fit of the proposed system based on the
City’s functional and technical requirements, and implementation approach. The selection process will
be conducted in accordance with the Request for Proposals and will be led by in-house project and
evaluation teams. Product demonstrations and vendor reference checks will also be used to select a
vendor.
The Request for Proposals and Attachments may be obtained beginning Wednesday, August 2, 2017.
Interested parties shall submit information as specified in the Request for Proposals to the City of Lake
Elmo before 4:00 pm Central Time on September 1, 2017. Further information or questions, please
contact: Brian Swanson – Finance Director at bswanson@lakeelmo.org. There are two files associated
with this RFP package.
The City requests interested proposers to provide Notice of Interest to the Point of Contact identified
in Table 02 in section 1.11. Notice of Interest is not required.
The City of Lake Elmo City Council reserves the right to reject any or all bid proposals, to waive
technicalities, to re-advertise, or to proceed otherwise when the best interest of said Council will be
realized herein. No bid may be withdrawn for a period of at least 180 days after the actual date of
opening thereof.
Brian A. Swanson, Finance Director
ADVERTISE: August 2, 2017
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 5
1.1 Introduction
This Request for Proposals (RFP) is intended to solicit proposals from proposers capable of satisfying the City
of Lake Elmo’s needs for software and professional services to implement an Enterprise Resource Planning
(ERP) system. Proposers’ responses will be evaluated and ranked based on the criteria described in this RFP.
If a system(s) is available that meets the City’s needs, the City may then enter into contract discussions with
the selected proposer.
This RFP and the selected proposal in response to this RFP will be incorporated into the contract resulting from
this solicitation; provided, however, that the contract may contain terms different from or in addition to this RFP
and the successful proposal. For purposes of this RFP, the term “vendor,” “offeror,” and “proposer” are
considered to have the same meaning.
1.2 About The City of Lake Elmo
The City of Lake Elmo was incorporated in 1926 and is a statutory city in the State of Minnesota six miles east
of St. Paul Minnesota. Located in Washington County, it covers 25 square miles and has an estimated
population of 9,000, which represents 3,100 households.
Policy-making and legislative authority are vested in a governing council consisting of an elected Mayor and
four council members. Per Minnesota State Statute, the governing council is responsible for passing
ordinances, adopting an annual budget, appointing committees and hiring both the city’s administrator and
attorney. The City Administrator is responsible for carrying out the policies and ordinances of the governing
council and overseeing the day-to-day operations of the city. The Council is elected on a non-partisan basis.
The Mayor serves a four-year term and council members serve a four-year staggered term, with two of these
positions elected every two years. The Mayor and the Council are elected at-large. The City also has a
Finance Committee, which reviews the City’s Budget, Capital Improvement Plan, financial policies and makes
recommendations to the City Council for consideration. All Finance Committee members are not members of
the City Council, but are appointed by the City Council.
The City of Lake Elmo provides a full range of Services including fire protection services, construction and
maintenance of streets and infrastructure; recreational facilities; and water, sanitary sewer and storm water
utility services. The City contracts with the Washington County Sheriff’s Department for police services.
1.3 Project Objectives
The City of Lake Elmo is planning to replace its current financial and information systems environment with an
ERP system. In doing so, the City seeks to address several challenges in the current environment, including
but not limited to:
Lack of functionality in current systems.
Limited online self-service functionality and payment options.
Limited reporting capabilities in current systems.
Lack of integration among systems.
Manual workflow processes.
City accounts receivable information is tracked in MS Excel.
Lack of budget forecasting capabilities.
Limited access to the existing system.
Need for more robust project tracking.
Time entry and approval is manual.
Current hardware is no longer supported.
1.0 RFP Introduction and Background
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 6
In order to address these challenges and others, the City has initiated an enterprise -wide project to adequately
plan for, select, and implement an ERP system. Section 2.0, Project Scope, outlines the features and
functionality desired in a future ERP system as well as the professional services activities to be a part of
implementation.
1.4 Definitions
ADDENDA – Written instruments issued by the City of Lake Elmo prior to the date for receipt of Proposals,
which modify or interpret the Request for Proposal (RFP) documents by addition, deletions, clarification or
corrections.
CITY - The City of Lake Elmo, a political subdivision of the State of Minnesota.
CITY EVALUATION TEAM – The group of City staff that will be evaluating vendor proposals
CITY IMPLEMENTATION TEAM – The group of City staff that will be leading the software implementation.
CONTRACT DOCUMENTS - The proposed Agreement will consist of the Request for Proposals, submitted
Proposal, including any diagrams, blueprints, addenda, and the City’s Standard Agreement for Professional
Services.
CONTRACTOR -The qualified Vendor/consultant that is awarded a contract to provide ERP software and
implementation services for the City of Lake Elmo.
PROJECT – The ERP implementation project.
PROPOSAL – A complete and properly signed proposal to provide goods, commodities, labor or services for
the sum stated and submitted in accordance with the Request for Proposal.
PROPOSER - The person, Contractor, corporation or other entity submitting a Proposal on items listed in the
RFP Documents and thereby agreeing to meet the terms and conditions of th e specifications if awarded the
contract.
VENDOR - The person, consultant, corporation or other entity submitting a Proposal on items listed in the RFP
and thereby agreeing to meet the terms and conditions of the specifications if awarded the contract.
1.5 No Obligation
The inquiry made through this RFP implies no obligation on th e part of the City of Lake Elmo.
1.6 RFP Schedule of Events
The following RFP Schedule of Events represents the best estimate of the schedule the City will follow. The
City has performed extensive planning work and has planned to meet the dates described below. Vendors are
encouraged to hold the demonstration dates listed. The City has an aggressive schedule for implementation
and will need to stay on the schedule of dates listed below in order to meet its implementation goals. If a
component of the schedule is delayed, it shall be anticipated that the remaining components will also be delayed
by a similar number of days. Any significant change to the schedule will be published via RFP Addendum.
Table 01: RFP Schedule of Events
Event Estimated Date
Request for Proposals Published August 2, 2017
Deadline for Proposal Submissions September 1, 2017
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 7
Points of Contact
Short List Vendors notified September 6, 2017
Vendor Demonstrations September 13-14, 2017
Preferred Vendor Notified September 21, 2017
Begin Contract Negotiations October 4, 2017
1.7 Pre-Qualification of Vendors
The City has not employed a pre-qualification process. No vendors are either pre -qualified or precluded from
responding to this RFP.
1.8 Minimum Qualifications
In order for proposals to be evaluated and considered for award, proposals must be deemed responsive. To be
deemed responsive, the submitted proposal documents shall conform in all material respects to the
requirements stated by the RFP, and, proposers shall document and validate the capability to fully perform all
requirements defined by the RFP. Factors to be considered include, but are not limited to: experience, integrity,
reliability, capacity and other factors required to provide the services defined by the RFP.
1.9 Partnerships
Proposers are encouraged to establish partnership relationships to fully provide all requirements defined by the
RFP. Vendors engaged in a partnership relationship shall submit a single proposal in response to this RFP.
Partnership relationships shall be clearly defined by proposal responses. Such definition shall identify the entity
in the partnership relationship deemed the Prime Vendor. It is expected that any item in the proposal response
guidelines that relates to an individual vendor’s capabilities shall be responded to for each vendor in the
partnership relationship.
1.10 Incurred Expenses
Neither the City of Lake Elmo nor any of its offices or employees shall be responsible for any cost incurred by
a proposer in preparing and/or submitting a proposal response or participating in presentations as part of the
evaluation procedure.
1.11 Questions and Inquiries
The following table provides the contact information in order of preference by the City.
Table 02: Points of Contact
Brian Swanson – Finance Director
bswanson@lakeelmo.org
651-747-3909
Kristina Handt – City Administrator
khandt@lakeelmo.org
651-747-3905
Amy LaBelle – Accountant
alabelle@lakeelmo.org
651-747-3916
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 8
Questions and inquiries related to this procurement, including questions and inquiries related to technical issues
are to be submitted in writing via email and directed to the contacts in Table 02 above.
All questions and inquiries related to this RFP must reference the RFP or attachment page n umber and section.
Questions shall be concise and numbered.
1.12 Clarification and Discussion of Proposals
The City may request clarifications and conduct discussions with any proposer who submits a proposal.
Proposers must be available for a presentation to the City on specific dates if selected for software
demonstrations.
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 9
2.1 Functional Areas
The following table contains the list of functional areas of the desired ERP system.
Table 03: Functional Areas
No. Functional Area
1 General Ledger and Financial Reporting
2 Budgeting
3 Accounts Payable
4 Accounts Receivable and Cash Receipts
5 Project Accounting
6 Capital Assets – (Optional)
7 Human Resources
8 Payroll
9 Special Assessments – (Optional)
10 Utility Billing – (Optional)
The City has identified an anticipated go-live date for core financials functionality of January 2, 2018.
2.2 City and Project Staffing
The City intends to utilize existing staffing during the implementation process. Additional City resource planning
has not been completed and will be based on the resource estimates and staffing plan provided by the vendor.
2.3 Number of Users
The following user counts by module contained in Table 04 are estimates and are provided for planning
purposes only.
Table 04: Number of Users
No. Functional Area Total Users
1 General Ledger and Financial Reporting 10
2 Budgeting 10
3 Accounts Payable 10
4 Accounts Receivable and Cash Receipts 5
5 Project Accounting 10
6 Capital Assets 4
7 Human Resources 4
8 Payroll 5
9 Special Assessments 4
10 Utility Billing 7
The estimated total users does not reflect those that may need concurrent access. As the City is projecting
2.0 Project Scope
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 10
these total user counts, vendors should make any needed estimates for concurrent users based on experiences
with organizations of similar size to the City of Lake Elmo.
2.4 Current City Applications Environment
The City of Lake Elmo currently uses Springbrook Software Version 6.00 to meet the Enterprise Resource
Planning (ERP) software needs of its users, including (but not limited to) the following modules: Accounts
Payable, Bank Reconciliation, Cash Receipts, General Ledger, and Payroll. The City has not upgraded the
Springbrook software in many years, as version 7.18.2 is available and utilized by other Springbrook clients,
which is cloud, based.
The City also uses Banyon utility billing software; however, Banyon is not fully integrated with Springbrook. As
such, data must be periodically uploaded into Springbrook. Both systems are used primarily by the Finance
Department. Other systems and programs currently used by the City include:
PermitWorks – This software is utilized by the Building and Finance Departments for licenses and permits, with
integration possible, which is just beginning implementation.
Beehive - The Public Works department is currently using Beehive for asset tracking, which does not integrate
with Springbrook.
Laserfiche Document Management System - The City currently uses Laserfiche Document Management
System version 9.1.1. Integration between Laserfiche and Springbrook does not exist therefore users are
required to search both systems for relevant information. End users also reported that finding documents in
Laserfiche can be difficult and integration with a future system should decrease the need to search directly
within Laserfiche.
Other systems and programs currently used by the City include:
Neptune – Utility Billing
AutoRead – Utility Billing
Plan-It! Capital Improvement Software – This does not integrate with Springbrook and not anticipated it would
need to be capable with future software.
Microsoft Windows – overall system environment of the City.
SCADA
2.5 Current City Technical Environment
The following sub-sections describe areas of the City’s technical environment.
1. Support Model
Technology in the City is coordinated by the City Clerk and Finance Director and provided by the City of
Roseville’s Information Technology Department on a contractual basis. In addition, the City has support
agreements for Springbrook through Accela, PermitWorks, and for its Utility Billing software Banyon.
2.6 Gap-Fit Analysis
The City expects the selected vendor to conduct a high -level gap-fit analysis and the functionality available in
the selected software product. The gap-fit analysis will identify areas where the City may be required to change
existing business processes or potentially customize the ERP system to accommodate unique process
requirements. The City desires to limit the number of customizations in the future environment and will work
with the vendor to review the results of the gap-fit analysis and determine where customizations would be
beneficial.
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 11
The City expects that the vendor will review the results of the gap-fit analysis with City staff in onsite meetings
at the initiation of the project. The vendor will update its response to the Functional and Technical Requirements
based on this discussion with any necessary changes to ensure the v endor and the City have a common
understanding of all business and technical requirements.
2.7 Implementation Project Plan
As part of the Project Scope, the selected vendor must develop and provide the City with a detailed
Implementation Project Plan that, at a minimum, will include the components listed below.
1. Project Objectives: This section should include overall project objectives.
2. Project Deliverables and Milestones: This section should include a list of deliverables and milestones
of the project and with each deliverable or milestone, this section should describe exactly what will be
provided and how it will be provided to meet the needs of the City.
3. Project Schedule: This section of the Project Plan should identify the dates associated with
deliverables and milestones described in Section 2 of the Project Plan. In addition, the Project Plan
should reflect project predecessors, successors and dependencies.
2.8 Software Customization Plan
As part of the Project Scope, the selected vendor will develop and provide a detailed Software Customization
Plan that includes anticipated customizations and their impact to the overall project schedule, budget, and final
success. This software customization plan should describe the process that the City and the vendor will engage
in for accepting the software modifications. While it is the City’s intent to utilize the vendor system’s existing
capabilities and embedded best-practice business processes, it recognizes that there will be some critical work
processes that require some amount of software customization.
2.9 System Interface Plan
As part of the Project Scope, the selected vendor will develop and provide a detailed System Interface Plan that
contains the proposed strategy for interfacing to all applications. During the gap-fit analysis, vendors will conduct
the work necessary to gain an understanding of the existing environment and the complete list of interfaces that
will need to be developed.
2.10 Data Conversion Plan
As part of the Project Scope, the selected vendor will develop and provide a detailed Data Conversion Plan that
describes how files will be converted to the proposed system (e.g., through software conversion aids/utility
programs or special programs that must be written, the actual conversion procedures, etc.). The City would like
to understand how the proposer would approach developing the data conversion plan, and the proposer’s
project team to convert existing data as well as to interface with identified source systems will undertake what
processes. A conversion schedule should identify planned conversion steps, estimated hours, and what
resources will be required (by City or proposer) for all pertinent legacy data. Data conversion shall occur when
migrating to the new application. The proposer is expected to assist the City in the conversion of both electronic
and manual data to the new system. It is expected that the City will be responsible for data extraction from
current systems and data scrubbing and that the proposer shall be responsib le for overall data conversion,
coordination, definition of file layouts, and data import and validation into the new system(s). Proposers should
plan to have converted data ready for the User Acceptance Testing phase of the project.
2.11 Testing Plan
As part of the Project Scope, the selected vendor will develop and provide a Testing Plan that describes all
phases of testing: unit, system, interface, integration, regression, parallel, and user acceptance testing. It is the
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 12
City’s expectation that the T esting Plan govern all phases of the project and that the vendor will provide
assistance during each testing phase involving City users. The vendor will develop the initial User Acceptance
Testing (UAT) plan, provide templates and guidance for developing test scripts, and will provide onsite support
during UAT. The vendor will also provide a plan for stress testing of the system that will occur during or after
UAT.
2.12 Training Plan
As part of the Project Scope, the selected vendor will develop, provide, and manage a detailed plan for training.
This Training Plan must include the information described below.
1. The role and responsibility of the software and/or implementation vendor in the design and
implementation of the training plan (e.g., development of customized training materials, delivering
training to City end users).
2. The role and responsibility of the City staff in the design and implementation of the training plan.
3. Overview of proposed training plan/strategy, including options for on-site or off-site training services,
for the core project implementation team, end users, and technology personnel.
4. Proposed training schedule for City personnel of various user and interaction levels.
5. Descriptions of classes/courses proposed in the training plan. (The vendor should specify the unit of
measure for its training, e.g., units, classes, days, etc., and define the hours associated with these units
of measure.) The vendor must be very clear about exactly what training courses are included in the
cost of the proposal.
6. The knowledge transfer strategy proposed by the software and/or implementation vendor to prepare
City staff to maintain the system after it is placed into production.
7. Detailed description of system documentation and resources that will be included as part of the
implementation by the vendor including, but not limited to, detailed system user manuals, “Quick
Reference” guides, online support, help desk support, user group community resources, and others as
available.
It is the City’s intention that the selected vendor will coordinate the training of City personnel in the use of its
application and that satisfactory implementation of an approved training plan will be a key component of this
project’s deliverables.
The proposer will provide documentation, including training manuals and agendas, before each training session
with City staff.
2.13 System Documentation
As part of the Project Scope, the selected vendor will develop and provide documentation that describes the
features and functions of the proposed application software. The documentation shall be provided for both users
and the technical personnel who will administer and maintain the system. It is desirable that differing levels of
documentation (user documentation and technical documentation) exist. The selected vendor shall provide
documentation in web-based and PDF forms for each application module.
Proposers shall provide sample System Documentation as part of responses in accordance with the Submittal
Response Format described in Section 4.0. In addition, proposers shall provide an overview of the system
documentation that will be provided as part of system implementation.
2.14 Risk Register
As part of the Project Scope, the selected vendor will develop and maintain a documented Risk Register. Such
Risk Register will be maintained in a centrally accessible location (i.e., project portal) and be regularly updated.
For each risk identified, the vendor shall be responsible to develop an impact summary and a mitigation strategy
in a timely fashion.
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 13
3.1 Evaluation Process
The City’s Evaluation Committee will initially review and evaluate each proposal received to determine the
proposer’s ability to meet the requirements of the City. The evaluation criteria described in Section 3.2 will be the
basis for evaluation.
The Evaluation Committee will determine the vendor (s) best suited to meet the needs of the City based on the
scoring of the evaluation criteria.
The City, at its sole discretion, reserves the right to have system demonstrations with any or all proposers.
Demonstrations will be conducted at City offices. Time limitations and demonstration requirements will be provided
with the notification. Each Evaluation Committee member will score the demonstration.
Demonstrations will be assigned a portion of the overall Technical Capability score. The City may elect, at its sole
option, to conduct discussions or demonstrations with all, some or no proposers. Demonstrations will involve a
scripted demonstration as well as a demonstration “lab.”
The City may request additional information or clarification of proposals and hereby reserves the right to select
the particular response to this RFP that it believes will best serve its business and operational requirements,
considering the evaluation criteria set forth below.
3.2 Evaluation Criteria
The evaluation criteria in the following table are intended to be the basis by which each pro posal will be evaluated,
measured, and ranked. The City hereby reserves the right to evaluate, at its sole discretion, the extent to which
each proposal received compares to the stated criteria. The recommendation of the Evaluation Committee shall
be based on the evaluations using the criteria.
Table 05: Evaluation Criteria
Criteria Description Maximum Score
Functional &
Technical
This criterion considers both the qualifications of the
personnel proposed to provide the services solicited by this
RFP and the products that are proposed to be used in
performing the services solicited by this RFP. In evaluating
the proposer’s products, the City will consider the business
benefits and the business process improvements because
of implementing the proposer’s products.
35 points
Approach
This criterion considers the proposer’s understanding of the
scope of work and the quality and clarity of the proposer’s
written methodology and description of the proposed
approach to accomplish the work.
20 points
Experience
This criterion considers (1) the proposer’s past performance
on any City contracts, (2) the results of reference checks,
and (3) the proposer’s experience in providing the services
solicited by this RFP as set forth in the proposer’s response.
20 points
Cost
This criterion considers the price of the services solicited by
this RFP. Proposers will be evaluated on their pricing
scheme as well as on their price in comparison to the other
proposers.
25 points
3.3 Best and Final Offer/Request for Clarification
A Best-and-Final-Offer process may be initiated if it is determined to be in the best interest in the City. Such
3.0 Proposal Evaluation and Award
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 14
process may be initiated following any evaluation process step.
Additional processes of scope and cost clarification may be employed as part of the evaluation process.
3.4 Negotiations and Contract Execution
The City reserves the right to negotiate the final terms and conditions of the contract to be executed. In the event
the City and the vendor are unable to agree upon all contract provisions, the City reserves the right to cease
negotiations, to select another vendor, or to reject all Proposals.
3.5 Contracting Ethics
1. No elected official or employees of the City who exercise any responsibility in the review, approval, or
implementation of the Proposal shall participate in any decision that affects his or her direct or indirect
financial interests.
2. It is a breach of ethical standards for any person to offer, give, or agree to give any City employee or
Council person, or for any City employee or Council person to solicit, demand, accept, or agree to
accept from another person or agency, a gratuity or an offer of employment whenever a reasonable
prudent person would conclude that such consideration was motivated by an individual, group, or
corporate desire to obtain special, preferential, or more favorable treatment than is normally accorded
the general public.
3. The Vendor shall not assign any interest in this contract and shall not transfer any interest in the same
without the prior written consent of the City.
4. The Vendor shall not accept any private client or project that may place it in ethical confl ict during its
representation of the City.
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 15
4.1 General Instructions
Proposers submitting proposals must follow the following instructions :
1. The deadline for proposal submissions is established in Section 1.0, RFP Introduction and Background.
The proposal deadline is August 17, 2017 at 4:00 PM Central Time. Proposals received after this deadline
will not be accepted and will be returned to proposer.
2. Proposers shall submit four (4) hard copies of the Technical Proposal and four (4) hard copies of the Cost
Proposal under separate covers to the City at the address contained in Table 06. One (1) hard copy of
the Technical Proposal and one (1) hard copy of the Cost Proposal should be clearly marked as “Original,”
and the remaining copies should be clearly marked “Copy”.
3. Proposers shall submit an electronic version of the Technical Proposal and an electronic version of the
Cost Proposal on a USB drive to the City along with hard copy proposals.
4. Mailed proposals shall be clearly labeled on the outside of the packaging with the RFP Title.
5. The mailing address for proposals is contained in the following table.
Table 06: Proposal Mailing Address
City Mailing Address
City Lake Elmo
Attn: RFP – ERP Solution
3800 Laverne Avenue North
Lake Elmo, MN 55042
4.2 Transmittal Letter and Executive Summary
The first tab of the proposal should contain the Transmittal Letter and Executive Summary. The Transmittal Letter
shall be signed by an authorized representative of the company such as the owner, partner, or in the case of a
corporation, the President, Vice President, Secretary, or other corporate officer(s).
The Transmittal Letter must provide the proposer’s primary contact information, including the following:
1. Name of the proposer representative
2. Title
3. Name of company
4. Address
5. Telephone number
6. E-mail address and
7. Signature of authorized officer of the firm
The Transmittal Letter shall be printed on the proposer’s letterhead.
The Transmittal Letter shall clearly express understanding and acceptance of all specifications, terms, conditions,
and requirements set forth in this RFP.
The Executive Summary should provide a brief summary of the proposal contents, emphasizing any unique
aspects or strengths of the proposal. The Executive Summary may be incorporated as part of the Transmittal
Letter.
4.0 Submittal Response Format
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 16
Tab 1 should not exceed three pages.
4.3 Project Approach and Software Solution
The second tab of the proposal should include a description of the proposed approa ch for providing the services
described in Section 2.0, Scope of Work. This section must also include a summary description of the capabilities
for each functional area of the Functional and Technical Requirements contained in Attachment B in narrative
format. The purpose of this summary is so that the City has a high -level understanding of the proposed solution.
The narrative should be written for an audience of the end-user community. Descriptions should be included for
any products proposed by third parties to meet the capabilities described in the Functional and Technical
Requirements in Attachment B.
Marketing materials should not be submitted on the proposed functionality.
Proposers shall describe any assumptions made in proposals in detail. These s hould include any assumptions
related to the current City technical environment, staffing, project management approach, and City resources
available during implementation and support phases.
4.4 Implementation Methodology
The third tab of the proposal should include a comprehensive description of the proposed implementation
methodology for the project. The description should include how the proposer has developed this methodology to
both incorporate lessons learned from experiences as well as to meet the needs described in Section 2.0, Project
Scope.
The City has identified an anticipated go-live date for core financials functionality of January 2, 2018. As part of
the third tab of the proposal, vendors shall include a proposed project schedule.
Proposers should also include a sample Project Plan as part of the third tab.
4.5 Company Background and History
The fourth tab of the proposal should include a comprehensive narrative history of the firm, including the
development of its experience in providing services similar to those described in Section 2.0, Scope of Work. The
following points should be addressed in the fourth tab of the proposal.
1. Total number of employees
2. Office locations
3. Total number of active clients
4. Total number of active government clients
5. Total number of active city government clients
6. Total years offering government ERP systems
7. Largest active government installation including population
8. Smallest active government installation including population
9. Other products offered by company
10. Mergers and acquisitions in the past ten years including the entities involved
If a partnership with third-party companies is a part of a proposal, the company background and history shall be
provided for all third-party companies. It is expected that all of the points above shall be addressed for each
company involved in a proposal, prime or third party.
4.6 Key Proposed Personnel and Team Organization
The fifth tab of the proposal should include the resumes of the proposed project personnel as well as the structure
of the proposed Vendor Project Team. The resumes and structures shall be provided for the implementation team
as well as the personnel involved in live operation and ongoing support and maintenance.
Resumes shall be specific to the actual personnel to be assigned to this project for all primary roles.
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The City reserves the right to require background checks be conducted on any individual conducting work as
either an employee of the vendor or on the vendor’s behalf.
4.7 Project Roles and Responsibilities
The sixth tab of the proposal should include the proposed resource levels for the City and Vendor Project Teams.
The tab shall include the completed Resource Hours Worksheet contained in Attachment B.
Vendors shall provide resource hour estimates by system module for each of the project activities contained in
the two worksheets. A worksheet is provided for the City Project Team and a second worksheet is provided for
the Vendor Project Team. Resource hour estimates provided should be based on the descriptions in Section 2.0,
Project Scope.
4.8 Project Schedule
The seventh tab of the proposal should include the proposed project schedule including major milestones,
activities, and timing of deliverables.
4.9 Data Conversion Plan
The eighth tab of the proposal should include the proposed Data Conversion Plan that will ensure the City’s
desired data is transferred to the new system. The Plan shall include estimated work levels as well as roles and
responsibilities related to data conversion, for both the City and the vendor, organized by module.
4.10 Sub-Contracting
The ninth tab of the proposal should identify any of the required services that are proposed to be sub- contracted,
if any. For each of these services the following should be provided:
1. Summary of service
2. Reasons for sub-contracting
3. Proposed sub-contractor
4. Detailed sub-contractor responsibilities
5. Sub-contractor name
6. Sub-contractor location
7. Sub-contractor experience
8. Previous use of sub-contractor and
9. Any additional relevant information
4.11 References
The tenth tab of the proposal should identify the proposer’s references for the project. Propo sers shall provide at
least three (3) City government clients with whom the proposer has worked with in the past five (5) years and that
are of similar size and complexity to the City of Lake Elmo. References shall be preferred from City governments
that have been live with the current software version for a minimum of two (2) years.
In the event the proposer cannot provide the required references, substitution of other organizations should be
made to ensure three (3) total references are provided. Proposers shall indicate how these substitute references
deviate from the requested characteristics.
If possible, the City prefers references that were managed by the same pro ject manager recommended for the
City. This section of the RFP response should also include an affirmative statement that the proposer grants its
consent for the City to contact the proposer’s references for purposes of evaluating the proposer for this pro ject
and acknowledges that any information obtained from the proposer’s references will not be disclosed to the
proposer.
4.12 Response to Narrative Questions
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The eleventh tab of the proposal should include the proposer’s response to the following narrative q uestions. The
total tab length shall not exceed fifteen pages.
1. Based on information provided in this RFP and experience in working with other cities, what is the
proposer’s perspective on the most significant risks to this project and how do you plan to m itigate these
risks?
2. What is your process for monitoring, escalating, and resolving issues that will arise during the project?
3. How do you propose to keep the project on task?
4. Provide a clear description of project management responsibilities between the City and the Vendor.
5. What is the earliest you can begin implementation after contract signing?
6. Please describe your organization’s recommended approach toward retention of legacy financial, budget,
revenue, and payroll data. Please describe what options are available/supported within your proposed
solution.
7. What other system modules or products would the proposer recommend to be complementary to the
Project Scope as described in Section 2.0?
8. Describe how your software solution can support the annual proce ss of reviewing capital projects to
determine which expenditures should be capitalized, which should be operating expense and which
should remain as work-in-progress.
9. How can your system import CIP information from a third party, external source?
10. The City intends to consider implementing customer self-service functionality in future phases of the
project. Please describe the available functionality of your software for providing citizen self-service.
11. What is your approach to managing documents in an environment where a City has an existing enterprise
document management system? What documents might exist in an integrated ERP content manager
versus the DMS?
12. The City currently has limited usage of credit cards but may expand this in the future. Please describe
your ability to integrate with credit cards for City purchases.
13. What strategic decisions or direction is your firm taking or making related to the product being proposed
today?
14. What is the name and current release number of the product being proposed?
15. When will the next release be available?
16. How long does the typical implementation of the product being proposed take for an organization of
similar size to the City?
17. Does your firm complete the implementations of the product being proposed or is this effort outsourced?
18. What other applications will the product being proposed integrate with or have integrated with in the
past?
19. What sets your firm’s product being proposed apart from your firm’s competitors?
4.13 Software Hosting
The twelfth tab of the proposal shall include a full description of the respondent’s technical and operational capabilities
for software hosting.
The respondent shall include the following information in addition to this description:
1. Where are the data center and storage facilities?
2. Total number of active clients currently served by hosted solutions provided by your company.
3. How many years has your company provided hosted solutions?
4. How are hosted software applications deployed for use by numerous customers?
5. What availability and response time do you guarantee?
6. How many instances of unplanned outages have any of your customers experienced within the past five
(5) years?
7. What is your process for notification of standard maintenance and downtime?
8. The respondent shall provide relevant documentation related to any recent certifications related to their
hosting technical and operation capabilities.
4.14 Exceptions to Terms and Conditions
The thirteenth tab of the proposal should include any exception the proposer takes to the terms and conditions
set forth in this RFP. It is the City’s intention to be made aware of any exceptions to terms or conditions prior to
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contract negotiations.
4.15 Price Proposal
The proposer’s Price Proposal should be provided separately from all tabs of the proposer’s Technical Proposal.
The Price proposal shall consist of two sections:
1. The completed Cost Proposal Worksheet as contained in Attachment A. Proposers shall not modify the
worksheets in any way.
2. The proposer’s standard travel and expense policy.
3. Agreement with Payment and Retainage. The proposer shall provide a brief statement of agreement with
the Payment and Retainage terms identified in this RFP. If a proposer does not agree with all items, a
description should be provided of those items for which exception is taken.
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5.1 Contract Type
The resulting contract from this procurement shall be a not-to-exceed based contract in the form of the City’s
Standard Agreement for Professional Services attached to this RFP. The initial contract price will be based upon
prices submitted by the selected vendor, subject to contract negotiations with the City, and shall be firm for the
total number of years of the contract.
5.2 Contract Term
The Agreement shall be effective upon the date the Agreement is signed by both the City and the Contractor,
which will expire upon completion of the services covered by the Agreement. The City or the Contractor only
pursuant to the terms of the contract may terminate this Agreement .
5.3 Contract Review
The vendor will meet with the City not less than once per quarter to conduct a contract and performance review
of the vendor. These meetings will be either in person in Lake Elmo, Minnesota, or via teleconference or web-
conference. This contract and performance review will include a review of the pricing, delivery performance,
customer service, and improving operational efficiencies.
5.4 Contract Changes
Written requests for price changes in term contracts after the firm price period must be submitted in writing to the
City. Any increase will be based on the vendor’s actual cost increase only, as shown in written documentation. All
requests for price increases must be in writing, must not constitute increases in profit, and must contain data
establishing or supporting the increase in cost. At the option of the City, (1) the reques t may be granted; (2) the
contract may be cancelled and solicitation may be re -advertised; or (3) the contract may be continued without
change.
The City will accept or reject all such written requests within thirty (30) days of the date of receipt of vendor’s
request for price increase or receipt of proper written documentation, whichever is later.
If a price increase is approved, the City will issue an amendment to the contract specifying the date the increase
will be effective. The vendor will be required to send notice to all users of the contract. All services and related
accessories are to be billed at prices in effect at the time the service was rendered or order was placed.
If a price increase is rejected, the vendor will be notified and the co ntract will continue without change.
All other contract changes will be effective only on written agreement signed by both parties.
5.5 Contract Approval
This RFP does not, by itself, obligate the City to award a contract. The City’s obligation will commence following
the City Council’s approval of a contract. Upon written notice to the vendor, the City may set a different starting
date for the contract. The City will not be responsible for any work done by the vendor, even work done in good
faith, if it occurs prior to the contract start date set by the City.
5.6 Contract Dispute
In the event of contract dispute, dispute proceedings will be held in the State of Minnesota. Mediation will be a
mandatory first step in the event of a dispute, prior to any legal acti on as set forth in the contract.
5.0 Contract Terms and Conditions
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5.7 Payment and Retainages
The City understands that there will be potentially three types of costs that are associated with procuring a new
system: software licensing, implementation services and annual maintenance costs. In the following sub-sections,
each type of cost is defined and the City’s expectations for payments and retainage associated with these costs
are described.
1. Software Licensing Cost
Software license costs include all costs related to licensing the software application and include third-
party software license fees, where applicable. In presenting software license fees, the proposer shall:
Explain all factors that could affect licensing fees;
Make clear what type of license is offered for each price (named user, concurrent user, installed
copies, processor-based, etc.);
Indicate which product versions, operating platform(s), are included for each price;
Indicate whether a product is for “server” or “client,” as applicable; and,
Make clear the extent of any implementation services that are included in the license fees
(installation, configuration, training, etc.).
To the extent possible, the proposer shall show any applicable discounts separately from the prices for
products and services. The City requests that the proposer provide separate prices for each functional
area/module in the proposed solution. In addition, the City expects software maintenance costs will not
increase in the first three years starting from beneficial use of each module. The City will provide payments
associated with software license fees on a milestone basis described in the following table.
Table 7: Software Licensing Payment Milestones
Project Milestone (for
each phase of the
implementation)
License
Payment (%
of Total)
Associated Test
Project Launch and
Project Plan Approval 20% Launch Meeting has been completed and the City
has signed off on the Project Plan deliverable.
Initial System
Implementation 20% Identified users can access the off-the-shelf system
from all workstations.
System Configuration
Complete
25%
The City has provided formal acceptance that all
business requirements have been successfully
configured and end users can access the
configured test environment. End users are fully
trained to undertake UAT activities.
Approval of Go-Live 20% The City has signed off on the UAT test results.
Acceptance of System 15% The City has signed off on at least two months of
system operations and financial statements.
2. Implementation Services Cost
Implementation service costs include all costs related to implementation, configuration, data conversion,
customization, and training. Typically, implementation service costs are provided as “not to exceed”
estimates and the City will be charged for services as incurred.
The City will pay eighty-five percent (85%) of the implementation service costs on a monthly basis as
incurred on the project. Fifteen percent (15%) of the implementation service co sts will be retained (as a
“hold-back”) until successful completion of the associated project phase. The fifteen percent (15%) hold -
back will be paid to the vendor upon City’s written acceptance of the system (see above for associated
test criteria) and sign-off at phase completion.
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Costs for the proposed solution should be submitted on the Cost Worksheet (Attachment A). It is important
to note the following:
The City will not consider time and materials pricing. Proposers shall provide fir m and fixed
pricing based on the functionality described. For each item, indicate if the cost is one -time,
annual, or other;
The proposer shall provide price information for each separate component of the proposed
solution, as well as the costs of any modifications;
In the event the product or service is provided at no additional cost, the item should be noted as
"no charge;”
In the event the product or service is not being included in the proposal, the item should be
noted as "No Bid;” and,
Proposer shall make clear the basis of calculation for all fees.
All travel expense costs must be included in the proposer’s fixed price cost. The City will not make a
separate payment for reimbursable expenses. The City shall not be liable for additional travel costs
incurred due for any reason outside the City’s control.
3. Annual Maintenance Cost
Annual maintenance costs include the annual maintenance and support fees for the application
environment. For example, the annual maintenance fees associated with Accounts Payable will be paid
upon City acceptance of the project phase associated with the Accounts Payable module. The City will
not pay maintenance fees on functional areas until City sign -off has been provided to approve live
operation for one year after go live. The City expects software maintenance costs will not increase in the
first three years upon live operation.
5.8 Taxes and Taxpayer Information
The awarded vendor must provide a valid W -9 form within five (5) days of notification of award.
The City will be paying any taxes in accordance with all applicable regulations.
5.9 Federal Requirements
The vendor must comply with all known federal requirements that apply to the proposal, the evaluation, and the
contract.
5.10 Confidential Information
Any written, printed, graphic, or electronic or magnetically recorded information furnished by the City for the
proposer’s use are the sole property of the City. This proprietary information includes, but is not limited to,
customer requirements, customer lists, marketing information, and information concerning City employees,
products, services, prices, operations, security measures, and subsidiaries.
The proposer and its employees shall keep this confidential information in the strictest confidence, and will not
disclose it by any means to any person except with City approval, and only to the extent necessary to perform the
work under the agreement. This prohibition also applies to the proposer’s employees, agents, and subcontractors.
On termination of the agreement, the proposer will promptly return any confidential information in its possession
to the City.
5.11 City Property
The use of any City property must be approved in advance.
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5.12 Warranty
A warranty is sought for both the software and implementation services. It is assumed that proposers have priced
their services to recognize these warranty provisions. The extent of the warranty coverage will be evaluated as
part of the overall procurement process.
5.13 Source Code
Selected vendors shall place source code for the software modules licensed by the City in a repository. The
source code shall be kept current with the releases / version of the software in live use at the City. The source
code shall revert to the City for the City’s use if the vendor files for bankrup tcy or protection from creditors in a
court of law. The City shall then have full rights to use source code for any purposes other than resale.
Within thirty (30) calendar days of the vendor going out of business or no longer supporting the software being
licensed, the vendor shall provide appropriate source code to the City. The same applies if the vendor is merged
or acquired and the software is no longer supported. Once the City obtains the source code, it shall be a perpetual
license, and there shall not be any additional fees due, even if additional licenses are deployed.
5.14 Insurance Requirements
Amounts of Insurance
The Contractor shall maintain insurance coverage in the amounts set forth in the attached Standard Agreement
for Professional Services during the entire term of the contract. The City shall be named as an additional insured
on said commercial general liability policy and certificates of said insurance evidencing all of the coverages
required shall be provided to the City before any work on this project may commence . The Contractor shall not
allow any sub-contractor to commence work until all insurance has been obtained and copies have been filed and
accepted by the City. The Contractor shall be responsible for maintaining a valid certificate of insurance
referencing the limits included below on file with the City.
The Contractor must notify the City in writing thirty (30) days prior to cancellation or change in terms of the above
insurance coverage. All insurance must be provided at the Contractor’s expense and at no additional cost to the
City.
Other Insurance Requirements
The selected vendor agrees that it is its sole responsibility to provide the required Certificate of Insurance and that
failure to comply within ten (10) business days following notice of award and according to the requirements of this
RFP shall be a cause for termination of the contract.
Insurance requirements herein shall be issued by a company or companies of sound and adequate financial
responsibility and authorized to do business in the State of Minnesota. All policies shall be subject to examination
and approval by the City Attorney’s office for their adequacy as to form, content, form of protection, and providing
company.
Insurance requirements by this contract for the City as additional insured shall be primary insurance and not
contributing with any other insurance available to City, under any third party liability policy.
The selected vendor further agrees that with respect to the required insurances, the City shall:
1. Be named as additional insured/or an insured, on all required insurance except workers’ compensation.
2. Be provided with a waiver of subrogation, in favor of the City on all required insurance.
3. Be provided with an unconditional 30 days advance written notice of cancellation or material change.
4. Prior to execution of an agreement, be provided with either their original Certification of Insurance or
their insurance policy evidencing the above requirements.
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5.15 Conflict of Interest
Proposer shall at all times observe and comply with all Federal, State and local laws, ordinances and regulations
including all amendments and revisions thereto, which in any manner affect Proposer or the services an d/or items
to be provided, specifically and not limited to any laws relating to conflicts of interest. Failure to comply with any
applicable laws, including the provisions of the Act, may result in: i) the forfeiture by Proposer of all benefits of the
Contract; ii) the retainage by City of all services performed by Proposer and iii) the recovery by City of all
consideration, or the value of all consideration, paid to Proposer pursuant to any awarded contract.
5.16 Pending and Recent Litigation
Proposers must disclose any pending or recent litigation they are involved in as a company. Recent is defined as
the past three years. Information provided should include the timeline of the litigation history, the subject of the
litigation, and the status of the litigation. Proposals must also disclose any pending litigation of any third -party
partners in the proposal.
5.17 Proposer’s Certification
By signature on the proposal, the proposer certifies that it complies with:
1. The laws of the State of Minnesota and is licensed to conduct business in the State of Minnesota;
2. All applicable local, state and federal laws, codes and regulations;
3. All terms, conditions, and requirements set forth in this RFP;
4. A condition that the proposal submitted was independently arrived at, without collusion; and,
5. A condition that the offer will remain open and valid for the period indicated in this solicitation; and any
condition that the firm and/or any individuals working on the contract do not have a possible conflict of
interest.
If any proposer fails to comply with the provisions stated in this paragraph, the City reserves the right to reject the
proposal, terminate the contract, or consider the proposer in default.
5.18 Offer Held Firm
Proposals must remain open and valid for at least 180 days from the deadline specified for submission of
proposals. In the event award is not made within 180 days, the City will send a written request to all proposers
deemed susceptible for award asking proposers to hold their price firm for a longer specified period.
5.19 Amendment/Withdrawal of Proposals
Proposers may amend or withdraw proposals prior to the deadline set for receipt of proposals. No amendments
will be accepted after the deadline unless they are in response to a request of the City. After the deadline,
proposers may make a written request to withdraw proposals and provide evidence that a substantial mistake has
been made. The City may permit withdrawal of the proposal upon verifying that a substantial mistake has been
made, and the City may retain the proposer’s bid bond or other bid type of bid security, if one was required.
5.20 Alternate Proposals
Proposers may not submit alternate proposals for evaluation.
5.21 Subcontractors
Subcontractors may be used to perform work under this contract. If the proposer intends to use subcontractors,
the proposer must identify in the proposal the names of the subcontractors and the portions of the work the
subcontractors will perform.
If a proposal with subcontractors is selected, the proposer m ust provide the following information concerning each
prospective subcontractor within five working days from the date of the City’s request:
1. Complete name of the subcontractor
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2. Complete address of the subcontractor
3. Type of work the subcontractor will be performing
4. Percentage of work the subcontractor will be providing
5. Evidence, as set out in the relevant section of this RFP, that the subcontractor is registered and, if
applicable, holds a valid State of Minnesota business license
6. A written statement, signed by each proposed subcontractor, that clearly verifies that the subcontractor
is committed to render the services required by the contract and
7. A copy of the prime-contractor/sub-contractor contract verifying the prime-contractor has the sole
responsibility for any and all services under this RFP and is financially liable, without exception, to the
City for all services contracted by the proposer under this RFP
The proposer’s failure to provide this information, within the time set, may cause the City to consider its proposal
nonresponsive and reject it. The substitution of one subcontractor for another may be made only at the discretion
and prior written approval of the City Administrator, Finance Director, or contract administrator designated by the
City.
5.22 Joint Ventures
Joint ventures are acceptable. If submitting a proposal as a joint venture, the proposer must submit a copy of the
joint venture agreement that identifies the principals involved and its rights and responsibilities regarding
performance and payment.
5.23 Right of Rejection
The City reserves the right to reject any proposal, in completely or in part. Proposals received from debarred or
suspended vendors will be rejected. The City may reject any proposal that is not responsive to all of th e material
and substantial terms, conditions, and performance requirements of this RFP.
The City reserves the right to reject any proposal determined to be nonresponsive or any proposal from a vendor
deemed to be non-responsible. The City also reserves the right to refrain from making an award if it determines it
to be in its best interest.
5.24 Clarification of Proposals
In order to determine if a proposal is reasonably susceptible for award, communications by the City or the proposal
Evaluation Committee are permitted with any proposer to clarify uncertainties or eliminate confusion concerning
the contents of a proposal and determine responsiveness to the RFP requirements. Clarifications may not result
in a material or substantive change to the proposal. T he initial evaluation may be adjusted because of a
clarification under this section.
5.25 Rights to Submitted Material
It shall be understood that all proposals, responses, inquiries, or correspondence relating to or in reference to this
RFP, and all reports, charts and proposal or referencing information submitted in response to this RFP, shall
become the property of the City, and will not be returned. The City is subject to the Minnesota Government Data
Practices Act, Minnesota Statute Chapter 13, and all in formation submitted shall be disclosed as required by the
Act.
5.26 Contract Negotiation
After final evaluation, the City may negotiate with the offerors of the highest-ranked proposal. Negotiations, if held,
will be within the scope of the RFP and limited to those items that would not have an effect on the ranking of
proposals. If any proposer fails to negotiate in good faith, the City may terminate negotiations and negotiate with
the offeror of the next highest-ranked proposal.
If contract negotiations are commenced, they will be held at the City of Lake Elmo office locations at a date and
time to be determined.
If contract negotiations are held, the offeror will be responsible for all costs including its travel and per diem
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expenses.
5.27 Failure to Negotiate
If the selected proposer:
1. Fails to provide the information required to begin negotiations in a timely manner;
2. Fails to negotiate in good faith;
3. Indicates it cannot perform the contract within the budgeted funds available for the project; or,
4. If the proposer and the City, after a good-faith effort, cannot come to terms; then
The City may terminate negotiations with the proposer initially selected and commence negotiations with the next
highest-ranked proposer. At any point in the negotiation process, the City may, at is sole discretion, terminate
negotiations with any or all proposers.
5.28 Hold Harmless
The Proposer shall hold and save the City and its officers, agents, servants/employees harmless from liability of
any patented invention, process, article or appliance manufactured or used in the performance of the contract,
including its use by the City.
5.29 Protection of Resident Workers
The City of Lake Elmo actively supports the Immigration and Nationality Act (INA), which includes provisions
addressing employment eligibility, employment verification and non -discrimination. Under the INA, employers may
hire only persons who may legally work in the United Sta tes (i.e., citizens and nationals of the U.S.) and aliens
authorized to work in the U.S. The employer must verify the identity and employment eligibility of anyone to be
hired, which includes completing the Employment Eligibility Verification Form (I -9). The Proposer shall establish
appropriate procedures and controls so no services or products under the contract documents will be performed
or manufactured by any worker who is not legally eligible to perform such services or employment.
5.30 Statutory Information
Any consulting agreement resulting from this RFP shall be construed in accordance with the laws of the State of
Minnesota. Any litigation between the parties arising out of, or in connection with the contract shall be initiated in
the court system of the State of Minnesota.
All project participants, consultants, engineers and vendors must comply with all applicable federal, state and local
laws pertaining to contracts entered into by governmental agencies, including non-discriminating employment.
Contracts entered into because of submitting proposals are revocable if contrary to law.
5.31 Assignment or Subcontract
Neither party shall assign any right or interest, nor delegate or subcontract any obligation owed without the written
consent of the other.
5.32 Non-Discrimination Clause
During the performance of this Agreement, the Contractor will not dis criminate against any employee or applicant
for employment because of race, color, creed, religion, ancestry, national origin, sex, sexual orientation, disability,
age, marital status, or status with regard to public assistance. The Contractor will take affirmative action to ensure
that all employment practices are free of such discrimination. Such employment practices include, but are not
limited to, the following: hiring, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff,
termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship.
5.33 ADA
The Contractor agrees to comply with the Americans with Disabilities Act Section 504 of the Rehabilitation Act of
1973 and not discriminate on the basis of disability in the admission or access to, or treatment of employment in
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its services, programs, or activities. The Contractor agrees to hol d harmless and indemnify the City from costs,
including but not limited to damages, attorney’s fees, and staff time, in any action or proceeding brought alleging
a violation of ADA and/or Section 504 caused by the Contractor.
5.34 Audit
All books, records, documents and accounting procedures and practices of the successful Contractor relevant to
the Agreement shall, pursuant to Minnesota Statutes, Section 16C.05, subdivision 5, be subject to examination at
all times by the City and/or by the Legislative Auditor or State Auditor.
5.35 Laws
The Contractor will comply with all applicable local, state, and Federal laws, ordinances and regulations in the
performance of the Agreement. The Contract will comply with and be governed by all laws of the State of
Minnesota. Any violation shall constitute a material breach of the executed Agreement.
5.36 Human Rights
The Contractor agrees to comply with the Minnesota State Human Rights Act, Minnesota Statute Section 363.
5.37 Data Practices
The Contractor will comply with all applicable provisions of the Minnesota Government Data Practices Act,
Chapter 13, of the Minnesota Statutes.
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See MS Excel spreadsheet “City of Lake Elmo ERP RFP Worksheets 7-27-17.xlsx”
Attachment A – Cost Worksheets
Attachment B – Resource Hours Worksheets
Worksheets
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Standard Agreement for Professional Services
This Agreement (“Agreement”) is made on the day of , 20 , between
the City of Lake Elmo, Minnesota (hereinafter "City"), whose business address is 3800 Laverne Avenue
North, Lake Elmo, MN 55042, and , a
(hereinafter "Consultant") whose business address is .
Preliminary Statement
The City has adopted a policy regarding the selection and hiring of consultants to provide a variety of
professional services for City projects. That policy requires that persons, firms or corporations providing
such services enter into written agreements with the City. The purpose of this Agreement is to set forth
the terms and conditions for the provision of professional services by Consultant for
hereinafter referred to as the "Work".
The City and Consultant agree as follows:
1. Scope of Work. The Consultant agrees to provide the professional services shown in Exhibit A
( ) in connection with the Work. The terms of this Agreement shall
take precedence over any provisions of the Consultants proposal and/or general conditions
including proposals and/or general conditions. If the Consultants proposal is attached as the
Exhibit A Scope of Work, City reserves the right to reject any general conditions in such
proposal.
2. Term. The term of this Agreement shall be from _ through _
the date of signature by the parties notwithstanding. This Agreement may be
extended upon the written mutual consent of the parties for such additional period, as they deem
appropriate, and upon the terms and conditions as herein stated.
3. Compensation for Services. City agrees to pay the Consultant expenses in a total amount not
to exceed $ for the services as described in.
Standard Agreement for Professional Services
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A. Any changes in the scope of the work, which may result in an increase to the
compensation due the Consultant, shall require prior written approval by an authorized
representative of the City or by the City Council. The City will not pay additional
compensation for services that do not have prior written authorization.
B. Special Consultants may be utilized by the Consultant when required by the complex or
specialized nature of the Project and when authorized in writing by the City.
C. If Consultant is delayed in performance due to any cause beyond its reasonable control,
including but not limited to strikes, riots, fires, acts of God, governmental actions, actions
of a third party, or actions or inactions of City, the time for performance shall be extended
by a period of time lost due to the delay. Consultant will be entitled to payment for its
reasonable additional charges, if any, due to the delay.
4. City Information. The City agrees to provide the Consultant with the complete information
concerning the Scope of the Work and to perform the following services:
A. Access to the Area. Depending on the nature of the Work, Consultant may from time to
time require access to public and private lands or property. As may be necessary, the
City shall obtain access to and make all provisions for the Consultant to enter upon public
and private lands or property as required for the Consultant to perform such services
necessary to complete the Work.
B. Consideration of the Consultant's Work. The City shall give thorough consideration to all
reports, sketches, estimates, drawings, and other documents presented by the
Consultant, and shall inform the Consultant of all decisions required of City within a
reasonable time so as not to delay the work of the Consultant.
C. Standards. The City shall furnish the Consultant with a copy of any standard or criteria,
including but not limited to, design and construction standards that may be required in
the preparation of the Work for the Project.
D. City's Representative. A person shall be appointed to act as the City's representative
with respect to the work to be performed under this Agreement. He or she shall have
complete authority to transmit instructions, receive information, interpret, and define the
City's policy and decisions with respect to the services provided or materials, equipment,
elements and systems pertinent to the work covered by this Agreement.
5. Method of Payment. The Consultant shall submit to the City, on a monthly basis, an itemized
invoice for professional services performed under this Agreement. Invoices submitted shall be
paid in the same manner as other claims made to the City for:
A. Progress Payment. For work reimbursed on an hourly basis, the Consultant shall indicate
for each employee, his or her name, job title, the number of hours worked, rate of pay
for each employee, a computation of amounts due for each employee, and the total
amount due for each project task. Consultant shall verify all statements submitted for
payment in compliance with Minnesota Statutes Sections 471.38 and 471.391. For
reimbursable expenses, if provided for in Exhibit A, the Consultant shall provide an
itemized listing and such documentation as reasonably required by the City. Each invoice
shall contain the City’s project number and a progress summary showing the original (or
amended) amount of the contract, current billing, past payments and unexpended
balance of the contract.
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 31
B. Suspended Work. If any work performed by the Consultant is suspended in whole or
in part by the City, the Consultant shall be paid for any services performed prior to
receipt of written notice from the City of such suspension.
C. Payments for Special Consultants. The Consultant shall be reimbursed for the work of
special consultants, as described herein, and for other items when authorized in writing
by the City.
D. Claims. To receive any payment on this Agreement, the invoice or bill must include the
following signed and dated statement: “I declare under penalty of perjury that this
account, claim, or demand is just and correct and that no part of it has been paid.”
E. Final Payment. Final payment, constituting the entire unpaid balance of the
Compensation for Services, shall be paid by the City to the Consultant when the Work
has been completed, the Agreement fully performed, and the City accepts the Work in
writing.
6. Project Manager and Staffing. The Consultant has designated
to serve on the Project. They shall be assisted by other staff members as necessary to
facilitate the completion of the Work in accordance with the terms established herein.
Consultant may not remove or replace the designated staff from the Project without the
approval of the City.
7. Standard of Care. Consultant shall exercise the same degree of care, skill and diligence in
the performance of its services as is ordinarily exercised by members of the profession under
similar circumstances in Scott County, Minnesota. Consultant shall be liable to the fullest
extent permitted under applicable law, without limitation, for any injuries, loss, or damages
proximately caused by Consultant's breach of this standard of care. Consultant shall put forth
reasonable efforts to complete its duties in a timely manner. Consultant shall not be
responsible for delays caused by factors beyond its control or that could not be reasonably
foreseen at the time of execution of this Agreement. Consultant shall be responsible for costs,
delays or damages arising from unreasonable delays in the performance of its duties.
8. Audit Disclosure and Data Practices. Any reports, information, data, etc. given to, or
prepared or assembled by the Consultant under this Agreement which the City requests to be
kept confidential, shall not be made available to any individual or organization without the
City's prior written approval. The books, records, documents and accounting procedures and
practices of the Consultant or other parties relevant to this Agreement are subject to
examination by the City and either the Legislative Auditor or the State Auditor for a period of
six (6) years after the effective date of this Agreement. The Consultant shall at all times abide
by Minn. Stat. 13.01 et seq., the Minnesota Government Data Practices Act, to the extent the
Act is applicable to data and documents in the possession of the Consultant.
9. Termination. Either party may terminate this Agreement on thirty (30) days written notice if
the other party defaults or neglects to carry out the Work in accordance with the Agreement
or fails to perform any provisions of the Agreement. Upon termination under this provision, if
there is no fault of the Consultant, the Consultant shall be paid for services rendered and
reimbursable expenses until the effective date of termination. If however, the City terminates
the Agreement because the Consultant has failed to perform in accordance with this
Agreement, no further payment shall be made to the Consultant, and the City may retain
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 32
another consultant to undertake or complete the Work identified herein.
10. Subcontractor. The Consultant shall not enter into subcontracts for services provided under
this Agreement except as noted in the Scope of Work, without the express written consent of
the City. The Consultant shall pay any subcontractor involved in the performance of this
Agreement within ten (10) days of the Consultant's receipt of payment by the City for
undisputed services provided by the subcontractor. If the Consultant fails within that time to
pay the subcontractor any undisputed amount for which the Consultant has received payment
by the City, the Consultant shall pay interest to the subcontractor on the unpaid amount at the
rate of 1.5 percent per month or any part of a month. The minimum monthly interest penalty
payment for an unpaid balance of $100 or more is $10. For an unpaid balance of less than
$100, the Consultant shall pay the actual interest penalty due to the subcontractor. A
subcontractor who prevails in a civil action to collect interest penalties from the Consultant
shall be awarded its costs and disbursements, including attorney's fees, incurred in bringing
the action.
11. Independent Consultant. Consultant is an independent contractor engaged by City to
perform the services described herein and as such (i) shall employ such persons as it shall
deem necessary and appropriate for the performance of its obligations pursuant to this
Agreement, who shall be employees, and under the direction, of Consultant and in no respect
employees of City, and (ii) shall have no authority to employ persons, or make purchases of
equipment on behalf of City, or otherwise bind or obligate City. No statement herein shall be
construed to find the Consultant an employee of the City.
12. Insurance.
A. General Liability. Prior to starting the Work, Consultant shall procure, maintain and pay
for such insurance as will protect against claims or loss which may arise out of
operations by Consultant or by any subcontractor or by anyone employed by any of
them or by anyone for whose acts any of them may be liable. Such insurance shall
include, but not be limited to, minimum coverages and limits of liability specified in this
Paragraph, or required by law. The policy(ies) shall name the City as an additional
insured for the services provided under this Agreement and shall provide that the
Consultant's coverage shall be primary and noncontributory in the event of a loss.
B. Consultant shall procure and maintain the following minimum insurance coverages and
limits of liability on this Project:
Worker’s Compensation Statutory Limits
Employer’s Liability $500,000 each accident
Liability $1,500,000 property damage and bodily injury per
occurrence
$2,000,000 general aggregate
$2,000,000 Products – Completed
Operations Aggregate
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 33
$100,000 fire legal liability each occurrence
$5,000 medical expense
Comprehensive Automobile
Liability $1,000,000 combined single limit each accident
(shall include coverage for all owned, hired and non-
owed vehicles.
Umbrella or Excess Liability $1,000,000
C. The Comprehensive General/Commercial General Liability policy(ies) shall be
equivalent in coverage to ISO form CG 0001, and shall include the following:
a. Premises and Operations coverage with no explosions, collapse, or underground
damage exclusion (XCU).
b. Products and Completed Operations coverage. Consultant agrees to maintain
this coverage for a minimum of two (2) years following completion of its work.
Said coverage shall apply to bodily injury and property damage arising out of
the products-completed operations hazard.
c. Personal injury with Employment Exclusion (if any) deleted.
d. Broad Form CG0001 0196 Contractual Liability coverage or its equivalent.
e. Broad Form Property Damage coverage, including completed operations, or its
equivalent.
f. Additional Insured Endorsement(s), naming the “City of Lake Elmo” as an
Additional Insured, on ISO forms CG 2010 07 04 and CG 2037 07 04, or their
equivalent.
g. If the Work to be performed is on an attached community, there shall be no
exclusion for attached or condominium projects.
h. “Stop gap” coverage for work in those states where Workers’ Compensation
insurance is provided through a state fund if Employer’s liability coverage is not
available.
i. Severability of Insureds provision.
D. Professional Liability Insurance. The Consultant agrees to provide to the City a
certificate evidencing that they have in effect, with an insurance company in good
standing and authorized to do business in Minnesota, a professional liability insurance
policy. Said policy shall insure payment of damage for legal liability arising out of the
performance of professional services for the City. Said policy shall provide an
aggregate limit of $2,000,000. Said policy shall not name the City as an insured.
E. Consultant shall maintain in effect all insurance coverages required under this
Paragraph at Consultant’s sole expense and with insurance companies licensed to do
business in the state in Minnesota and having a current rating of no less than A-, unless
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 34
specifically accepted by City in writing. In addition to the requirements stated above,
the following applies to the insurance policies required under this Paragraph:
a. All policies, except the Professional Liability Insurance policy, shall be written
on an “occurrence” form (“claims made” and “modified occurrence” forms are
not acceptable);
b. All policies, except the Professional Liability Insurance policy, shall be apply on
a “per project” basis;
c. All policies, except the Professional Liability Insurance and Worker’s
Compensation Policies, shall contain a waiver of subrogation naming “the City
of Lake Elmo”;
d. All policies, except the Professional Liability Insurance and Worker’s
Compensation Policies, shall name “the City of Lake Elmo” as an additional
insured;
e. All policies, except the Professional Liability Insurance and Worker’s
Compensation Policies, shall insure the defense and indemnity obligations
assumed by Consultant under this Agreement; and
f. All polices shall contain a provision that coverages afforded there under shall
not be canceled or non-renewed, nor shall coverage limits be reduced by
endorsement, without thirty (30) days prior written notice to the City.
A copy of the Consultant’s Certificate of Insurance, which evidences the
compliance with this Paragraph, must be filed with City prior to the start of
Consultant’s Work. Upon request a copy of the Consultant’s insurance declaration
page, Rider and/or Endorsement, as applicable shall be provided. Such documents
evidencing Insurance shall be in a form acceptable to City and shall provide
satisfactory evidence that Consultant has complied with all insurance requirements.
Renewal certificates shall be provided to City prior to the expiration date of any of the
required policies. City will not be obligated, however, to review such Certificate of
Insurance, declaration page, Rider, Endorsement or certificates or other evidence of
insurance, or to advise Consultant of any deficiencies in such documents and receipt
thereof shall not relieve Consultant from, nor be deemed a waiver of, City’s right to
enforce the terms of Consultant’s obligations hereunder. City reserves the right to
examine any policy provided for under this paragraph.
F. Effect of Consultant’s Failure to Provide Insurance. If Consultant fails to provide the
specified insurance, then Consultant will defend, indemnify and hold harmless the City,
the City's officials, agents and employees from any loss, claim, liability and expense
(including reasonable attorney's fees and expenses of litigation) to the extent necessary
to afford the same protection as would have been provided by the specified insurance.
Except to the extent prohibited by law, this indemnity applies regardless of any strict
liability or negligence attributable to the City (including sole negligence) and regardless
of the extent to which the underlying occurrence (i.e., the event giving rise to a claim
which would have been covered by the specified insurance) is attributable to the
negligent or otherwise wrongful act or omission (including breach of contract) of
Consultant, its subcontractors, agents, employees or delegates. Consultant agrees that
this indemnity shall be construed and applied in favor of indemnification. Consultant also
agrees that if applicable law limits or precludes any aspect of this indemnity, then the
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 35
indemnity will be considered limited only to the extent necessary to comply with that
applicable law. The stated indemnity continues until all applicable statutes of limitation
have run.
If a claim arises within the scope of the stated indemnity, the City may require
Consultant to:
a. Furnish and pay for a surety bond, satisfactory to the City, guaranteeing
performance of the indemnity obligation; or
b. Furnish a written acceptance of tender of defense and indemnity from
Consultant's insurance company.
Consultant will take the action required by the City within fifteen (15) days of
receiving notice from the City.
13. Indemnification. Consultant agrees to defend, indemnify and hold the City, its officers, and
employees harmless from any liability, claims, damages, costs, judgments, or expenses,
including reasonable attorney's fees, to the extent attributable to a negligent or otherwise
wrongful act or omission (including without limitation professional errors or omissions) of the
Consultant, its agents, employees, or subcontractors in the performance of the services
provided by this Agreement and against all losses by reason of the failure of said Consultant
fully to perform, in any respect, all obligations under this Agreement. Consultant further agrees
to indemnity the City for defense costs incurred in defending any claims, unless the City is
determined to be at fault.
14. Ownership of Documents. All plans, diagrams, analyses, reports and information generated
in connection with the performance of the Agreement (“Information”) shall become the
property of the City, but Consultant may retain copies of such documents as records of the
services provided. The City may use the Information for its purposes and the Consultant may
use the Information for its purposes. Use of the Information for the purposes of the project
contemplated by this Agreement (“Project”) does not relieve any liability on the part of the
Consultant, but any use of the Information by the City or the Consultant beyond the scope of
the Project is without liability to the other, and the party using the Information agrees to defend
and indemnify the other from any claims or liability resulting therefrom.
15. Non-Discrimination. During the performance of this Agreement, the Consultant shall not
discriminate against any employee or applicants for employment because of race, color,
creed, religion, national origin, sex, marital status, status with regard to public assistance,
disability, sexual orientation or age. The Consultant shall post in places available to employees
and applicants for employment, notices setting forth the provision of this non- discrimination
clause and stating that all qualif ied applicants will receive consideration for employment. The
Consultant shall incorporate the foregoing requirements of this paragraph in all of its
subcontracts for program work, and will require all of its subcontractors for such work to
incorporate such requirements in all subcontracts for program work. The Consultant further
agrees to comply with all aspects of the Minnesota Human Rights Act, Minnesota Statutes
363.01, et. seq., Title VI of the Civil Rights Act of 1964, and the Americans with Disabilit ies
Act of 1990.
16. Compliance with Laws and Regulations. In providing services hereunder, the Consultant
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 36
shall abide by statutes, ordinances, rules, and regulations pertaining to the provisions of
services to be provided. Any violation of statutes, ordinances, rules and regulations pertaining
to the services to be provided shall constitute a material breach of this Agreement and entitle
the City to immediately terminate this Agreement
17. Mediation. Each dispute, claim or controversy arising from or related to this agreement shall
be subject to mediation as a condition precedent to initiating arbitration or legal or equitable
actions by either party. Unless the parties agree otherwise, the mediation shall be in
accordance with the Commercial Mediation Procedures of the American Arbitration
Association then currently in effect. A request for mediation shall be filed in writing with the
American Arbitration Association and the other party. No arbitration or legal or equitable action
may be instituted for a period of 90 days from the filing of the request for mediation unless a
longer period is provided by agreement of the parties. Cost of mediation shall be shared
equally between the parties. Mediation shall be held in the City of Lake Elmo unless another
location is mutually agreed upon by the parties. The parties shall memorialize any agreement
resulting from the mediation in a mediated settlement agreement, which agreement shall be
enforceable as a settlement in any court having jurisdiction thereof.
18. Assignment. Neither party shall assign this Agreement, nor any interest arising herein,
without the written consent of the other party.
19. Services Not Provided For. No claim for services furnished by the Consultant not specifically
provided for herein shall be honored by the City.
20. Severability. The provisions of this Agreement are severable. If any portion hereof is, for any
reason, held by a court of competent jurisdiction to be contrary to law, such decision shall not
affect the remaining provisions of this Agreement.
21. Entire Agreement. The entire agreement of the parties is contained herein. This Agreement
supersedes all oral agreements and negotiations between the parties relating to the subject
matter hereof as well as any previous agreements presently in effect between the parties
relating to the subject matter hereof. Any alterations, amendments, deletions, or waivers of
the provisions of this Agreement shall be valid only when expressed in writing and duly signed
by the parties, unless otherwise provided herein.
22. Waiver. Any waiver by either party of a breach of any provisions of this Agreement shall not
affect, in any respect, the validity of the remainder of this Agreement.
23. Governing Law. This Agreement shall be controlled by the laws of the State of Minnesota.
24. Conflicts. No salaried officer or employee of the City and no member of the Council of the
City shall have a financial interest, direct or indirect, in this Agreement. The violation of this
provision renders the Agreement void.
25. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall
be considered an original.
Executed as of the day and year first written above.
City of Lake Elmo
Request for Proposals
Enterprise Resource Planning System Page 37
CITY OF LAKE ELMO
Michael Pearson, Mayor
Kristina Handt, City Administrator
FIRM NAME
By:
Its:
City of Lake Elmo, MN
ERP RFP
Attachment A - Cost Worksheet Page 1 of 4
Cost Area
#1
General
Ledger and
Financial
Reporting
#2
Budgeting
#3
Accounts
Payable
#4
Accounts
Receivable and
Cash Receipts
#5
Project
Accounting
#6
Capital Assets
(Optional)
#7
Human
Resources
#8
Payroll
#9
Special
Assessments
(Optional)
#10
Utility Billing
(Optional)
Total
Software License Costs 0
Software Customization Costs 0
Interfaces/Integration Costs 0
Data Conversion Costs 0
Professional Service Costs (not including
integration and interfaces)0
Training Costs 0
Server Hardware Costs 0
Expenses (miscellaneous)0
Total One-Time Costs 0 0 0 0 0 0 0 0 0 0
Annual Maintenance 0
Custom Modification Maintenance (if
applicable)0
Additional Maintenance Fees 0
Total Recurring Maintenance Costs 0 0 0 0 0 0 0 0 0 0
Maintenance Schedule:Year 1 Year 2 Year 4 Year 5
Rate of Increase over Prior Year (as a
percentage)
Maintenance Costs (as a dollar amount)
Hourly Rate for Professional Services
Hourly Rate for Custom Programming
Annual rental cost for time clocks per device.
Other Costs (if applicable; please specify the
nature of these costs)
Additional Costs:
Cost Worksheet
Vendor-Hosted Cost Worksheet Instructions: Provide a cost response for each cost area, based
upon system modules for a vendor-hosted application. The pricing should be based on the detailed
functionality that the City requires for each functional area. When a single price may be provided for a
group of modules, please provide that cost with a notation. All additional costs should be captured in the
respective areas.
One-Time Costs:
Recurring Maintenance Costs:
City of Lake Elmo, MN
ERP RFP
Attachment A - Cost Worksheet Page 2 of 4
Cost Area
#1
General
Ledger and
Financial
Reporting
#2
Budgeting
#3
Accounts
Payable
#4
Accounts
Receivable and
Cash Receipts
#5
Project
Accounting
#6
Capital Assets
(Optional)
#7
Human
Resources
#8
Payroll
#9
Special
Assessments
(Optional)
#10
Utility Billing
(Optional)
Total
Software License Costs 0
Software Customization Costs 0
Interfaces/Integration Costs 0
Data Conversion Costs 0
Professional Service Costs (not including
integration and interfaces)0
Training Costs 0
Server Hardware Costs 0
Expenses (miscellaneous)0
Total One-Time Costs 0 0 0 0 0 0 0 0 0 0
Annual Maintenance 0
Custom Modification Maintenance (if
applicable)0
Additional Maintenance Fees 0
Total Recurring Maintenance Costs 0 0 0 0 0 0 0 0 0 0
Maintenance Schedule:Year 1 Year 2 Year 4 Year 5
Rate of Increase over Prior Year (as a
percentage)
Maintenance Costs (as a dollar amount)
Hourly Rate for Professional Services
Hourly Rate for Custom Programming
Annual rental cost for time clocks per device.
Other Costs (if applicable; please specify the
nature of these costs)
Additional Costs:
Cost Worksheet
City-Hosted via Third Party IT Contract-Cost Worksheet Instructions: Provide a cost
response for each cost area, based upon system modules for a vendor-hosted application. The pricing
should be based on the detailed functionality that the City requires for each functional area. When a
single price may be provided for a group of modules, please provide that cost with a notation. All
additional costs should be captured in the respective areas.
One-Time Costs:
Recurring Maintenance Costs:
City of Lake Elmo, MN
ERP RFP
Attachment B - City Project Team Page 3 of 4
Functional Area
Requirements
and Design
Configuration
and Setup Implementation Testing Training Total
General and Technical 0
General Ledger and Financial Reporting 0
Budgeting 0
Accounts Payable 0
Accounts Receivable and Cash Receipts 0
Project Accounting 0
Capital Assets 0
Human Resources 0
Payroll 0
Special Assessments 0
Utiltity Billing 0
Interfaces 0
Total Hours By Project Phase:0 0 0 0 0 0
City Project Team
Instructions: The vendor is asked to provide the amount of resources that will be required from the City, in terms of number of hours. These amounts should be based on
the functionality the City desires.
City of Lake Elmo, MN
ERP RFP
Attachment B - Vendor Project Team Page 4 of 4
Functional Area
Requirements
and Design
Configuration
and Setup Implementation Testing Training Total
General and Technical 0
General Ledger and Financial Reporting 0
Budgeting 0
Accounts Payable 0
Accounts Receivable and Cash Receipts 0
Project Accounting 0
Capital Assets 0
Human Resources 0
Payroll 0
Special Assessments 0
Utility Billing 0
Interfaces 0
Total Hours By Project Phase:0 0 0 0 0 0
Vendor Project Team
Instructions: The vendor is asked to provide the amount of resources that will be committed to the project in terms of number of hours. These amounts should be based on
the functionality the City desires.
STAFF REPORT
DATE: August 1, 2017
CONSENT
AGENDA ITEM: 2017 Seal Coat Project – Pay Request No. 1
SUBMITTED BY: Ryan Stempski, Project Engineer
REVIEWED BY: Krintina Handt, City Administrator
Jack Griffin, City Engineer
ISSUE BEFORE COUNCIL: Should the City Council approve Pay Request No. 1?
BACKGROUND: The 2017 Seal Coat Project has been substantially completed for work in both Lake
Elmo and West Lakeland Township. The only work remaining is for the contractor to place pavement
marking tabs in Lake Elmo prior to public works striping the pavements later this fall. Payment in the
amount of $164,639.75 has been requested by the Contractor, Allied Blacktop Company, based upon the
work completed. The City has retained 5% of the total work completed for punchlist items in the amount
of $8,665.25. The work completed for Lake Elmo streets was $122,265.00. Per the Joint Services
Agreement, West Lakeland Township will be invoiced $51,040.00 for their portion of the construction
costs.
PROPOSAL DETAILS/ANALYSIS: Allied Blacktop Company has submitted Pay Request No. 1 in
the amount of $164,639.75. The request has been reviewed and payment is recommended in the amount
requested. The City has retained 5% of the total work completed for punchlist items in the amount of
$8,665.25.
FISCAL IMPACT: None. Payment is proposed in accordance with the Contract for the project.
Payment remains within the authorized scope and budget.
RECOMMENDATION: Staff is recommending that the City Council approve, as part of the Consent
Agenda, Pay Request No. 1 for the 2017 Seal Coat project. If removed from the consent agenda, the
recommended motion for the action is as follows:
“Move to approve Pay Request No. 1 to Allied Blacktop Company in the amount of $164,639.75 for the
2017 Seal Coat Project; which includes $122,265.00 for work completed in the City of Lake Elmo; and
$51,040.00 for work completed in West Lakeland Township.”
ATTACHMENTS:
1. Pay Estimate No. 1
STAFF REPORT
DATE: August 1, 2017
CONSENT
AGENDA ITEM: 2017 Street Improvements - Change Order No. 1
SUBMITTED BY: Jack Griffin, City Engineer
REVIEWED BY: Kristina Handt, City Administrator
Rob Weldon, Public Works Director
Chad Isakson, Project Engineer
ISSUE BEFORE COUNCIL: Should the City Council approve Change Order No. 1 for the 2017 Street
Improvements?
BACKGROUND: Hardrives, Inc. was awarded a construction contract to complete the 2017 Street
Improvements on May 16, 2017. The project is in construction with a substantial completion date of
September 22, 2017.
PROPOSAL DETAILS/ANALYSIS: Hardrives, Inc. has submitted a change order to address two
design changes requested by the City as follows:
1. Replace an existing roadway culvert that has collapsed (failed) that was not intended for
replacement in the original contract. The work includes mobilization and replacement of a culvert
that failed at Station 17+50 on 55th Street North.
2. Improve the installation of two culverts by extending them beyond the City right-of-way after
obtaining easements from an abutting property. The work includes the extension of culvert 305-1
by approximately 8 feet with the installation of riprap; and the extension of culvert 306-1 by
approximately 16 feet with the installation of riprap.
FISCAL IMPACT: This change order will increase the contract in the amount of $15,742.25 bringing
the revised construction contract to $1,053,948.39. With this change order the project remains within the
authorized project budget and contingencies.
RECOMMENDATION: Staff is recommending that the City Council approve, as part of the Consent
Agenda, Change Order No. 1 for the 2017 Street Improvements. If removed from the consent agenda, the
recommended motion for the action is as follows:
“Move to approve Change Order No. 1 for the 2017 Street Improvements, thereby increasing the
contract amount by $15,742.25”.
ATTACHMENTS:
1. Change Order No. 1.
CHANGE ORDER NO. 1
2017 STREET IMPROVEMENTS
CITY OF LAKE ELMO, MINNESOTA
PROJECT NO. 2016.135
QUANTITY UNIT PRICE AMOUNT
CO1‐1 LS 1.0 $2,400.00 $2,400.00
CO1‐2 LF 54.0 $5.25 $283.50
CO1‐3 LF 54.0 $60.90 $3,288.60
CO1‐4 EA 1.0 $2,205.15 $2,205.15
CO1‐5 EA 1.0 $700.00 $700.00
CO1‐6 LS 1.0 $3,150.00 $3,150.00
CO1‐7 LS 1.0 $3,715.00 $3,715.00
TOTALS ‐ CHANGE ORDER NO. 1 $15,742.25
After obtaining easements from an abutting property owner the
installation of Culvert 306‐1 can be improved by extending the culvert
an additional 16 LF beyond the street right‐of‐way. Work includes
culvert extension and rip rap placement.
DESCRIPTION / JUSTIFICATIONITEM DESCRIPTION OF PAY ITEM UNIT
CHANGE ORDER
MOBILIZATION
REMOVE STORM SEWER
CULVERT 306‐1 EXTENSION
18‐INCH RCP STORM SEWER
18‐INCH FES W/ TRASHGUARD
CONNECT TO EXISTING STRUCTURE
CULVERT 305‐1 EXTENSION
Replace an existing roadway culvert at station 17+50 on 55th Street
North that has collapsed (failed) and was not intended for replacement
in the original contract.
After obtaining easements from an abutting property owner the
installation of Culvert 305‐1 can be improved by extending the culvert
an additional 8 LF beyond the street right‐of‐way. Work includes
culvert extension and rip rap placement.
STAFF REPORT
DATE: August 1, 2017
CONSENT
AGENDA ITEM: CSAH 13 (Ideal Avenue) Improvements – Approve Cooperative Agreement
Payment No. 2
SUBMITTED BY: Chad Isakson, Project Engineer
REVIEWED BY: Krintina Handt, City Administrator
Jack Griffin, City Engineer
ISSUE BEFORE COUNCIL: Should the City Council approve Payment No. 2 for the CSAH 13 (Ideal
Avenue) Improvements?
BACKGROUND, PROPOSAL DETAILS/ANALYSIS: In May 2017, the City of Lake Elmo entered
into Cooperative Agreement No. 10904 with Washington County for the cost sharing of the CSAH 13
(Ideal Avenue) Improvements. In accordance with the agreement payment schedule, Washington County
has submitted Invoice #125153 in the amount of $1,256.83. The amount requested reflects the City’s
share of the construction costs expended through partial pay estimate #1 to the general contractor. The
invoice has been reviewed and payment is recommended in the amount requested.
FISCAL IMPACT: No additional fiscal impact. Payment is proposed in accordance with Cooperative
Agreement No. 10904 with Washington County.
RECOMMENDATION: Staff is recommending that the City Council approve, as part of the Consent
Agenda, payment to Washington County in the amount of $1,256.83 for the CSAH 13 (Ideal Avenue)
Improvements. If removed from the consent agenda, the recommended motion for the action is as
follows:
“Move to approve payment to Washington County in the amount of $1,256.83 for CSAH 13 (Ideal
Avenue) Improvements in accordance with Invoice #125153 attached and per Section G of Cooperative
Agreement No. 10904.”
ATTACHMENTS:
1. Washington County Invoice No. 125153 and supporting detail.
CSAH 13 ‐ TH 5 to CSAH 35 ‐ Billing Summary
City of Lake Elmo
County/City Cooperative Agreement #10904
Through Cost Split #1
7/18/2017
Estimated Cost
(from Cooperative
Agreement)
Current Cost
(based on Bid) Previously Billed
Current Amount
Due
Construction 328,120.80$ 29,508.54$ 28,251.71$ 1,256.83$
Design Engineering 38,999.17$ 38,999.17$ 38,999.17$ ‐$
Construction Engineering/Contract Administration 16,419.42$ ‐$ ‐$ ‐$
Right of Way
Road Improvements (36.1%)96,855.00$ ‐$ ‐$ ‐$
Storm Pond (20%)68,000.00$ ‐$ ‐$ ‐$
TOTAL 548,394.39$ 68,507.71$ 67,250.88$ 1,256.83$
STAFF REPORT
DATE: August 1, 2017
CONSENT
MOTION
TO: Mayor and City Council
FROM: Kristina Handt, City Administrator
AGENDA ITEM: Service Contract with Youth Service Bureau
BACKGROUND:
Statutory cities, like Lake Elmo, are limited to the authority granted to them under state statute.
Generally, cities are not granted authority to make donations to non-profits. However, a city may use its
contracting powers to enter into an agreement for services from a non-profit. The City has been giving
money to Youth Service Bureau (YSB) for a number of years. It is typically handled in the annual
budgeting process. In 2016, $5,000 was budgeted. In 2017 the amount budgeted was $5,250.
ISSUE BEFORE COUNCIL:
Should the city approve a service contract with Youth Service Bureau?
PROPOSAL DETAILS/ANALYSIS:
Included in your packet is a contract for services between Youth Service Bureau and the City of Lake
Elmo for 2018. The contract outlines the services provided by Youth Service Bureau to a person living
in, attending school in or issued a citation in the City of Lake Elmo. In exchange, the City of Lake Elmo
will pay $5,250 to YSB for these services.
The City Attorney has reviewed the contract and her comments were incorporated into the latest draft by
YSB. Bob Sherman, Executive Director of Youth Service Bureau will be at the meeting if there are any
questions.
FISCAL IMPACT:
The fee for the service for 2018 is $5,250. This amount has been included in the first draft of the budget
presented to Finance Committee on 7/13/17.
OPTIONS:
1) Approve the service contract
2) Amend and then approve the service contract
3) Do not approve the service contract
RECOMMENDATION:
If removed from the consent agenda:
Motion to approve the 2018 Service Contract with Youth Service Bureau
ATTACHMENTS:
• 2018 Contract
• Info Sheet on Services Provided
1
Service Contract between CITY OF LAKE ELMO
and YOUTH SERVICE BUREAU, INC.
The City of Lake Elmo, 3800 Laverne Avenue North, Lake Elmo, Minnesota 55042, hereinafter referred
to as the “City,” and Youth Service Bureau, Inc., 101 West Pine Street, Stillwater, Minnesota, 55082,
hereinafter referred to as the “Contractor,” enter into this agreement for the period from January 1,
2018, to December 31, 2018.
WHEREAS, the City is committed to using community-based approaches to strengthen individuals,
families, and community;
WHEREAS, the City has identified the following outcomes for juvenile diversion and early intervention:
Juvenile offenders will be held accountable for their actions by engaging in activities that repair the
harm done to the victim and community and will participate in programs that promote an increased
understanding of the impact of their offense on victims, communities, and themselves;
Crime victims will be notified of diversion proceedings; will have opportunities to provide input;
and, if willing, will have the opportunity to participate in the process;
Community members will have active and direct involvement in programming;
WHEREAS, the City, pursuant to its goals of providing accountability and the most appropriate
diversion and early intervention available to juvenile offenders, wishes to purchase services for youth
involved in at-risk behavior from the Contractor to support these outcomes;
NOW, THEREFORE, the parties agree as follows:
1. Contractor's Responsibilities
Contractor agrees to provide the following services:
a) Complete an in-person intake meeting with the juvenile and parent(s) with all qualified
referrals and to include approved standardized screening tools.
b) Provide Community Work Service (CWS), and recruit and support CWS sites. Supervise
and monitor community work service clients who are ordered by a court and/or referred by
local law enforcement officials. Actively connect with CWS sites in the community,
strengthen those relationships and seek/develop new CWS sites for youth.
c) Provide educational and prevention/early-intervention programs, specifically as follows:
chemical awareness, bullying awareness, conflict awareness, theft awareness, or another
approved alternative. Eligible juveniles include those who are Court-ordered, and those who
are referred by local law enforcement, schools, or parents. The reason for the referral must
be for behavior or actions that could result in a police report, a citation, or a petition for
delinquency.
d) Provide evaluation and counseling. Counseling services can include crisis intervention,
individual and family and group counseling. Families will pay for these services using
insurance coverage or by using an available sliding-fee scale. The City subsidizes costs of
counseling services after the family’s insurance coverage or ability to pay has been
exhausted.
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e) Provide victims of crimes diverted by local law enforcement the opportunity for direct or
indirect involvement into how the juvenile should be held accountable, including
consideration of the impact of the crime on the victim and any specific needs for restitution.
When necessary, due to the nature of the offense, restitution will be determined, collected,
and paid to the victim.
f) When possible and appropriate, facilitate restorative justice interventions, such as victim-
offender mediation, family group conferencing, and/or community-panels, so that juvenile
offenders are held directly accountable to the victim and victimized community through some
form of reparation.
g) Monitor agreements or contracts to ensure follow-through by juvenile offenders. The
agency agrees to use a standardized contract form as developed by the Washington County
Juvenile Probation Aide and the individual Youth Diversion Specialists at quarterly meetings.
Ongoing communication between the Diversion Specialists and the referring parties is
expected to allow for maximum case-management and coordination.
h) The Contractor agrees to provide the programs for youth and families enumerated in
Attachment A, which is incorporated herein by reference.
2. Client Eligibility
A person, subject to the purview of the City (meaning such persons as live in, attend school
in, or are issued a citation in the city) between the ages of five and eighteen, or older if still
in high-school, their family members, and the victims of juvenile crime who are assessed to
be appropriate shall be eligible for services provided under the terms of this Agreement.
3. Cost and Delivery of Purchased Services – The total amount to be paid to the Contractor
for services purchased under this agreement shall not exceed Five Thousand Two Hundred
and Fifty Dollars ($5,250.00). For these services, the City agrees to make annual/quarterly
payments to the Contractor of Five Thousand Two Hundred and Fifty Dollars ($5,250.00) on
or about January 15, 2018. The City acknowledges that evaluation and counseling services
will be provided to families at rates set by YSB, which may be paid through insurance or
directly by families with the ability to pay for such services.
4. Evaluation, Reporting, and Information Requirements – The Contractor agrees to
reasonable evaluations of its programs, employees, and volunteers and make them
available for review by the City if so requested. The Contractor agrees to comply with all
reporting requirements as assigned by law, rule, or contract by the State of Minnesota. The
Contractor further agrees to abide by all laws and rules regarding confidentiality and data
practices. The Contractor agrees to provide necessary information allowed by law and
deemed necessary by the City and/or local law enforcement on referred cases.
5. Indemnification – The Contractor agrees to indemnify, defend, and hold harmless the City,
its officers, employees, and agents for all claims arising out of the Contractor’s activities
related to the services provided under this agreement up to the liability limits set forth in
Minn. Stat. 466.04. The City will indemnify YSB, Inc., from and against all liability up to the
liability limits set forth in Minn. Stat. 466.04. No other provision of this agreement shall serve
to limit in any way the obligations of the Contractor to indemnify and defend the City under
this clause.
6. Insurance Requirements – The Contractor agrees that in order to protect it self, as well as
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the City, from claims arising out of the Contractor’s activities under this agreement, it will at
all times during the term of this agreement keep in force policies of insurance providing the
following coverage: professional liability insurance in the amount of One Million Dollars
($1,000,000); comprehensive general liability insurance policy in the amount of One Million
Dollars ($1,000,000); automobile liability insurance, including non-owned and hired autos, in
the amount of One Million Dollars ($1,000,000). The Contractor further agrees to maintain
Workers’ Compensation insurance as required by applicable law. Contractor will also
maintain excess liability coverage in the amount of One Million Dollars ($1,000,000) per
occurrence. Certificates of Insurance showing the coverage listed herein shall be provided
to the City within 30 days of the effective date of this contract.
7. Data Privacy – All data collected, created, received, maintained, or disseminated for any
purpose by the activities of the Contractor because of this agreement is governed by the
Minnesota Government Data Practices Act, Minn. Stat. Chapter 13, as amended, the
Minnesota Rule implementing such Act now in force or as adopted, as well as federal
regulations on data privacy.
8. Record Disclosures/Monitoring – Pursuant to Minn. Stat. 16C.05, Subd. 5, the Contractor
agrees that the City, the State Auditor, or any of their duly authorized representatives at any
time during normal business hours and as often as they may reasonably deem necessary,
shall have access to and the right to examine, audit, excerpt, and transcribe any books,
documents, papers, records, etc., which are pertinent to the accounting practices and
procedures of the Contractor and involve transactions relating to this agreement. The
Contractor agrees to maintain these records for a period of three years from the date of
termination of this agreement.
9. Nondiscrimination – During the performance of this agreement, the Contractor agrees to
the following: No person shall, on the grounds of race, color, religion, age, sex, disability,
marital status, public assistance status, criminal record, creed, or national origin be excluded
from full employment rights in, participation in, be denied the benefits of, or be otherwise
subjected to discrimination under any and all applicable federal and state laws against
discrimination.
10. Independent Contractor – Nothing contained in this agreement is intended or should be
construed as creating the relationship of co-partners or joint ventures with the City or the
City’s law enforcement services provider. No tenure or any rights or benefits, including
Workers’ Compensation, unemployment insurance, medical care, sick leave, vacation leave,
severance pay, PERA, or other benefits available to City employees shall accrue to the
Contractor or employees of the Contractor performing services under this agreement.
11. Conditions of the Parties’ Obligation – This agreement may be canceled by either party
at any time, with or without cause, upon 30 days’ notice, in writing, delivered by mail, or in
person. Any alterations, variations, modifications, or waivers of the provisions of this
agreement shall be valid only when they have been reduced to writing, duly signed by both
parties, and attached to the original of this agreement. In the case of cancellation of this
contract, the fee will be refunded on a prorated basis based on the number of months left in
the contract.
12. Compliance With Law – The Contractor shall abide by all federal, state, or local laws,
statutes, ordinances, rules, and regulations now in effect or hereinafter adopted insofar as
they relate to the Contractor’s performance of the provisions of this agreement.
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13. Firearms – Unless specifically required by the terms of this contract, no provider of services
pursuant to this contract, including, but not limited to, employees, agents, or subcontractors
of the Contractor shall carry or possess a firearm on City premises. Violation of this
provision shall be considered a substantial breach of the agreement. Violation of this
provision is grounds for immediate suspension or termination of this contract, without notice,
pursuant to Section 12.
14. Savings Clause – If any section of this agreement is found to be invalid or not enforceable,
the remainder of the agreement will remain in force and binding.
15. Governing Law – The laws of Minnesota shall govern the interpretation and prosecution of
this agreement.
16. Notices – If any official correspondence concerning this agreement needs to be
communicated to the other party, the following shall be deemed the effective
addresses
As to the City: City Administrator
City of Lake Elmo
3800 Laverne Avenue North
Lake Elmo, MN 55042
As to the Contractor: Youth Service Bureau, Inc.
101 West Pine Street
Stillwater, MN 55082
IN WITNESS THEREOF, the City and the Contractor have executed this agreement this
____________day of _____________________________, 2017.
By: ____________________________
Mayor, City of Lake Elmo
By: _____________________________
City Clerk, City of Lake Elmo
By: _____________________________
Robert T. Sherman
Executive Director
Youth Service Bureau, Inc.
STAFF REPORT
DATE: 8/1/2017
CONSENT
MOTION
TO: City Council
FROM: Rob Weldon, Public Works Director
AGENDA ITEM: Sunfish Lake Park Cross Country Trail Grooming Grant
REVIEWED BY: Kristina Handt, City Administrator
BACKGROUND:
For the past several years, the City has been a participant in the Cross Country Ski Trail
Assistance Program sponsored by the Minnesota DNR. This program allows for reimbursement
of costs related to maintaining the ski trails in the forms of fall trail maintenance and winter trail
grooming. The proposed application would cover the 2017/2018 ski season in Sunfish Lake
Park.
ISSUE BEFORE COUNCIL:
Should the city pursue submission of a grant application for Cross Country Trail Grooming
Reimbursement at Sunfish Lake Park?
PROPOSAL DETAILS/ANALYSIS:
Each year the City of Lake Elmo has participated in the Cross Country Ski Trail Assistance
Program for the trail system in Sunfish Lake Park. The fund allocations are driven by the number
of participants in the program and the number of trail miles being maintained. The city has
consistently received $4,000-$4,500 per year in grant funds to cover a portion of the costs related
to the Cross Country Ski Trail maintenance in Sunfish Lake Park. These funds are used to help
offset the cost of fall trail preparations and the cost of grooming throughout the winter months. A
requirement of the application process is to attach a resolution providing City Council approval
to sponsor the participation in the program.
FISCAL IMPACT:
• If awarded, the city could receive approximately $4,000 to $4,500 to help offset the cost
of trail maintenance.
OPTIONS:
• Approve participation in Cross Country Trail Grooming Grant
• Deny participation in Cross Country Trail Grooming Grant
• Table for future discussion
Page 2
RECOMMENDATION:
“Motion to approve Resolution2017-084 to approve grant submission to Minnesota
Department of Natural Resources for Cross Country Ski Trail Grant-In-Aid Program.”
ATTACHMENTS:
• Resolution 2017-084
• Grant Application
CITY OF LAKE ELMO
WASHINGTON COUNTY
STATE OF MINNESOTA
RESOLUTION NO. 2017-084
A RESOLUTION RELATED TO SPONSORING THE CITY OF LAKE ELMO
PARTICIPATION IN THE MINNESOTA DEPARTMENT OF NATURAL RESOURCES
CROSS-COUNTY SKI TRAIL GRANT-IN-AID PROGRAM FOR THE 2017/2018
SEASON
BE IT RESOLVED, by the City Council of the City of Lake Elmo, Minnesota, that the City of
Lake Elmo will sponsor the City participation in the Minnesota Department of Natural Resources
Cross-County Ski Trail Grant-In-Aid Program for the 2017/2018 Ski Season.
APPROVED by the Lake Elmo City Council on this 1st day of August 2017.
By: __________________________
Mike Pearson
Mayor
ATTEST:
________________________________
Julie Johnson
City Clerk
Revised 3/6/2015
MINNESOTA CROSS-COUNTRY SKI TRAIL GRANT-IN-AID PROGRAM
MAINTENANCE AND GROOMING APPLICATION
GENERAL INFORMATION
Trail Name:
Sunfish Lake Park Cross Country Ski Trail
Base Ski
GIA Grant
Amount: $ 4000.00
Trail Association or Club Name (if applicable):
City of Lake Elmo
Miles of Trail in GIA Program:
Trail Administrator Name:
Rob Weldon
Trail Administrator Email:
rweldon@lakeelmo.org
Trail Administrator Phone:
651-747-3941
Trail Administrator/Association Mailing Address (Street, Box Number, City, State, and Zip Code):
3800 Laverne Ave N Lake Elmo, MN 55042
Trail Administrator Signature:
Trail Administrator Signed Date:
8/1/2017
UNIT OF GOVERNMENT/SPONSOR APPROVAL
Unit of Government Sponsor:
City of Lake Elmo
Sponsor Email:
rweldon@lakeelmo.org
Sponsor Phone:
651-747-3941
Authorized Representative of Sponsor Name:
Rob Weldon
Authorized Representative of Sponsor Title:
Public Works Director
Sponsor Mailing Address (Street, Box Number, City, State, and Zip Code):
3800 Laverne Ave. N Lake Elmo, MN 55042
Sponsor Signature:
Sponsor Signed Date:
8/1/2017
REQUIRED ATTACHMENTS
Final Grooming Request for Reimbursement from Previous Year
Local Unit of Government/Sponsor Resolution
Map of Ski GIA Trail
Sign Order (if applicable)
DEPARTMENT OF NATURAL RESOURCES APPROVAL OF APPLICATION
Parks and Trails Area Supervisor Signature: Signed Date:
STAFF REPORT
DATE: August 1, 2017
CONSENT
AGENDA ITEM: Parks Commission Appointment
SUBMITTED BY: Kristina Handt, City Administrator
BACKGROUND:
Shane Weis resigned from the Parks Commission in July. As a result, Jean Ollinger should be moved up
from 1st alternate to a voting member (term ending 12/31/18)to complete Weis’ term and Tucker Pearce
moved from 2nd alternate to 1st alternate.
This leaves a vacancy in the 2nd alternate position.
ISSUE BEFORE COUNCIL:
Who should the Council appoint to the Parks Commission as a 2nd alternate?
PROPOSAL:
The City has received an application from John Mayek. The application was emailed to Council before the
meeting.
OPTIONS:
1) Appoint John Mayek to the Parks Commission as 2nd Alternate
2) Appoint someone else to the Parks Commission as 2nd Alternate
RECOMMENDATION:
“Motion to appoint John Mayek to the Parks Commission as 2nd Alternate
STAFF REPORT
DATE: August 1, 2017
REGULAR
MOTION
TO: City Council
FROM: Emily Becker, City Planner
AGENDA ITEM: Reconsideration of Shoreland Variance - 9359 Jane Road North
REVIEWED BY: Stephen Wensman, Planning Director
BACKGROUND:
The Council adopted Resolution 2017-062 at its June 20, 2017 meeting, which approved a variance
request from Scott and Julie Drommerhausen of 9359 Jane Road North for variances to allow expansion
of a non-conforming structure which does not meet the required minimum structure setback from the
Ordinary High Water Level (OHWL) and maximum impervious surface standards of the City’s shoreland
district. The approval was subject to the following conditions:
1) The Applicant shall secure any required permits and plan approvals from the City and other
applicable jurisdictions.
2) The Applicant shall direct appropriate rain gutter discharges into a rain garden (infiltration
basin designed to capture and infiltrate runoff) designed by a professional engineer or
landscape architect and installed under their direction. The rain garden should mitigate the
increased impervious surface of the entire addition to the home (685 square feet).
The Council has now expressed the desire to reconsider the variance, specifically condition #2 outlined
above.
ISSUE BEFORE THE COUNCIL:
The Council is being asked to hold a public hearing and consider if the variance approval granted by
adopted Resolution 2017-062 should be rescinded and if it should adopt a new resolution that approves
the variance request with amended conditions of approval.
PROPOSAL DETAILS/ANALYSIS:
MNDNR Comments. The Minnesota Department of Natural Resources (MNDNR) was noticed of the
variance request as required by the City’s Shoreland Ordinance, Section 154.800 of the Zoning Code. The
MNDNR recommended denial of the variance request, as the proposed addition would increase the
impervious surface on the property to 29.7% (which is almost twice the maximum impervious surface
allowed for unsewered properties within a recreational development shoreland (15%)) and is in a shore
impact zone. The MNDNR also recommended was made that if a variance was granted for this project,
mitigation conditions should be included with the variance approval. These mitigation conditions could
include modify construction design to minimize impact; direct rain gutter discharges into a rain garden; or
restore shoreline vegetation to natural state.
Page 2
Planning Commission Recommendation. Because of the MNDNR’s aforementioned recommendation,
Staff and the Planning Commission recommended that a condition of approval of the requested variance
be that the applicant direct appropriate rain gutter discharges into a rain garden (infiltration basin
designed to capture and infiltrate runoff). Staff believed that this would be the least expensive and most
reasonable option. Staff also added that the design of the rain garden be done by a professional engineer
or landscape architect and installed under their direction in order to ensure the rain garden’s effectiveness.
The Planning Commission recommended adding the Staff-recommended condition by adding that the rain
garden should mitigate the increased impervious surface of the entire condition (685 square feet).
Impervious Surface Added. As mentioned in the report and presentation to Council as it considered the
variance request, the proposed addition will be in place of an existing deck. The City does not consider
decks to be impervious surface, while many other cities and the MNDNR do. The proposed addition will
only add a total of 105 square feet to the existing footprint of the deck, but because the deck is considered
pervious, a total of 685 square feet of impervious surface will be added.
Rain Garden Cost. Staff has asked the City’s Consulting Landscape Architect for a quote for the
installation of a rain garden that would mitigate 685 square feet of impervious surface. This quote is
attached. The projected costs of such a rain garden would be $12,000.00. The City has required an escrow
with release of the building permit for this addition to ensure the rain garden is installed. Should the
Council wish to remove the condition of approval that the rain garden be installed, this escrow will be
released back to the applicant.
Public Hearing. The City Attorney has verified that a public hearing is required for a variance
amendment. The public hearing notice was advertised in the City’s official newspaper, and notices were
sent to property owners within 350 feet of the subject property. Additionally, the MNDNR was notified
per State Statute.
FISCAL IMPACT:
None.
OPTIONS:
The Council may:
• Adopt Resolution 2017-075, declaring Resolution 2017-067 rescinded and no longer in effect and
approving the variance requests, subject to the amended conditions of approval.
• Amend Resolution 2017-075 and adopt as amended.
• Not adopt Resolution 2017-075.
RECOMMENDATION:
If the Council wishes to adopt Resolution 2017-075, it may do so with the following motion:
“Move to adopt Resolution 2017-075, rescinding Resolution 2017-067 and approving requests for
shoreland variances from the minimum structure setback from the Ordinary High Water Level and
maximum impervious surface standards, subject to one condition of approval.”
ATTACHMENTS:
• Previously adopted Resolution 2017-062
• MNDNR review letter
• Resolution 2017-075
Page 3
• Quote for rain garden
1
CITY OF LAKE ELMO
WASHINGTON COUNTY
STATE OF MINNESOTA
RESOLUTION 2017-062
A RESOLUTION APPROVING A VARIANCE FROM MINIMUM STRUCTURE SETBACK
FROM ORDINARY HIGH WATER LEVEL AND MAXIMUM IMPERVIOUS SURFACE
STANDARDS OF THE CITY’S SHORELAND DISTRICT
WHEREAS, the City of Lake Elmo is a municipal corporation organized and existing
under the laws of the State of Minnesota; and
WHEREAS, Scott and Julie Drommerhausen, 9359 Jane Road North, Lake Elmo, MN
55042 (“Applicant”), has submitted an application to the City of Lake Elmo (the “City”) for
variances to allow construction of an approximately 685 square-foot addition, which will replace
an existing deck, to the east of an existing home currently setback 45.4 feet from the Ordinary
High Water Level (OHWL) and maximum impervious surface standards to increase the current
impervious surface percentage from 26.9% to 29.7%.
WHEREAS, notice has been published, mailed and posted pursuant to the Lake Elmo
Zoning Ordinance, Section 154.109; and
WHEREAS, the Lake Elmo Planning Commission held a public hearing on said matter
on June 12, 2017; and
WHEREAS, the Lake Elmo Planning Commission has submitted its report and
recommendation to the City Council as part of a Staff Memorandum dated June 12, 2017; and
WHEREAS, the City Council considered said matter at its June 20, 2017 meeting.
NOW, THEREFORE, based on the testimony elicited and information received, the
City Council makes the following:
FINDINGS
1) That the procedures for obtaining said Variance are found in the Lake Elmo Zoning
Ordinance, Section 154.109.
2) That all the submission requirements of said Section 154.109 have been met by the
Applicant.
3) That the proposed variance includes the following components:
2
a) A variance to allow for an addition to an existing single-family detached home
that does not meet the minimum setback from the OHWL or maximum
impervious surface requirements.
4) That the Variance will be located on property legally described as follows: Lots 9 & 10,
Berschen’s Shores, Washington County, Minnesota. PID# 10.029.21.24.0006.
5) That the strict enforcement of Zoning Ordinance would cause practical difficulties and
that the property owner proposes to use the property in a reasonable manner not permitted
by an official control. Specific findings: The subject property was platted prior to
adjustment of the Ordinary High Water of Lake Jane and the adoption of Shoreland
standards by the City, and therefore the lot is much wider than it is long. Because of the
shape of the lot, the Applicant is proposing to expand the home laterally rather than
further encroaching on the current setback of the Ordinary High Water Level.
Additionally, the addition will not expand much more of the footprint of the principal
structure, as a slightly smaller deck that will be torn down exists where the addition is
being proposed. Additionally, although the City’s ordinance does not treat decks as
impervious, many do. If decks were considered impervious, the addition would only add
109 square feet of impervious surface, or an increase of about 0.46%.
6) That the plight of the landowner is due to circumstances unique to the property not
created by the landowner. Specific findings: The property is unique in that it is much
wider than it is long, and the Applicant was not involved in the platting process of this
property nor the adoption of the City’s shoreland standards. The Applicant also was not
involved in any previous variance requests for the subject property.
7) That the proposed variance will not alter the essential character of the locality in which
the property in question is located. Specific findings: The proposed addition is in place of
an existing deck and only slightly increases the footprint of the existing principal structure,
including the existing deck, by 109 square feet. Additionally, the proposed addition does
not further encroach on the existing setback of the principal structure from the OHWL of
the property and has a setback from the OHWL similar to those of adjacent principal
structures.
8) That the proposed variance will not impair an adequate supply of light and air to
properties adjacent to the property in question or substantially increase the congestion of
the public streets or substantially diminish or impair property values within the
neighborhood. Specific findings: The proposed addition will not further encroach on the
setback of the existing structure from the OHWL and therefore will not further impair lake
views of neighboring properties and will not impair an adequate supply of light and air. It
also will not increase congestion of public streets or substantially diminish or impair
property values within the neighborhood. Adjacent properties, including the subject
property, have been granted similar variances and are setback a similar distance from the
OHWL.
CONCLUSIONS AND DECISION
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Based on the foregoing, the Applicant’s application for a Variance is granted, subject to the
following conditions.
1) The Applicant shall secure any required permits and plan approvals from the City and other
applicable jurisdictions.
2) The Applicant shall direct appropriate rain gutter discharges into a rain garden (infiltration
basin designed to capture and infiltrate runoff) designed by a professional engineer or
landscape architect and installed under their direction. The rain garden should mitigate the
increased impervious surface of the entire addition to the home (685 square feet).
Passed and duly adopted this 20th day of June 2017 by the City Council of the City of Lake
Elmo, Minnesota.
__________________________________
Mike Pearson, Mayor
ATTEST:
________________________________
Julie Johnson, City Clerk
CENTRAL REGION
1200 WARNER ROAD
SAINT PAUL, MN 55106
651-259-5800
6/9/2017
Emily Becker
Lake Elmo City Planner
3800 Laverne Avenue North
Lake Elmo, MN 55042
RE: Shoreland Variance Request at 9359 Jane Road North, Lake Elmo (Lake Jane - 82010400)
Emily –
The primary goal of limiting impervious surfaces within shoreland districts is to reduce the amount of runoff directed
into Minnesota waters. Runoff from impervious surfaces travels over the land and carries pollutants such as nutrients,
sediment, bacteria, pesticides, heavy metals, and organic wastes. Studies have consistently shown a strong, direct
connection between the percentage of impervious surface in a watershed and water quality degradation. As impervious
surface area expands, so does the volume of runoff, phosphorus, and sediment entering waters, causing nuisance algae
blooms, reducing public enjoyment, and harming aquatic plants and animals.
Please use the attached MNDNR guidance on variances to maximum impervious surface in shoreland districts when
evaluating this variance request against statutory criteria and developing a findings of fact. If findings support granting
the variance, impacts to Lake Jane should be considered in developing appropriate conditions to mitigate those impacts.
This project would increase impervious surface from 26.9% to 29.7%, where the maximum impervious surface allowed is
15% for unsewered properties within the shoreland district of a recreational development lake. MNDNR recommends
denial of this variance request because this additional increase in impervious surface would result in a percent
impervious that would be nearly double the City’s standard and because the proposed addition is within the shore
impact zone (SIZ). If a variance is granted for this project, MNDNR recommends that the City of Lake Elmo include
conditions on the variance that mitigate for this increase in percent impervious surface. Examples of appropriate
mitigation conditions include:
• Modify construction design (to minimize impact).
• Direct rain gutter discharges into a rain garden (infiltration basin designed to capture and infiltrate runoff).
• Restore shoreline vegetation to natural state (to intercept and filter runoff coming from the structure).
Thank you for the opportunity to comment on this variance request.
Sincerely,
Jenifer Sorensen
MNDNR, East Metro Area Hydrologist
1200 Warner Road
St. Paul, MN 55106
651-259-5754 | jenifer.sorensen@state.mn.us
Page 1
Page 1 of 2 Variance Guidance Series – ISC, Updated 10/10/2012
Shoreland & Floodplain
Variance Guidance Series
This is one of a series of examples developed as guidance for considering variance requests along
lakes and rivers. Consult your local shoreland and floodplain ordinances.
Why are impervious surface coverage limits important?
In the protection of water quality, the management of rainwater on individual lots is one of our most
important tasks. Rainwater that does not infiltrate into the ground or evaporate runs downhill to lakes,
wetlands, or rivers. As impervious surface coverage increases, the
rate and amount of runoff and pollutants entering public waters
increases. When runoff from impervious surface coverage is not
addressed, pollution increases and the diversity of aquatic life is
reduced. Local governments have limited discretion to deviate
from - or grant a variance to - impervious surface limits. They may
do so only if all of the variance criteria established in state statutes
and their local ordinances are met. In evaluating such requests,
local governments must examine the facts, determine whether all
statutory and local criteria are satisfied, and develop findings to
support the decision. If granted, local governments may impose
conditions to protect resources. An example impervious surface
variance request, with considerations, is provided below.
Example Impervious Surface Variance Request
A property owner wishes to build a large lakehome on a conforming lot.
The lake lot includes a private driveway with a spur to the neighbor’s lot,
which was placed to avoid an adjacent wetland. The building plans for
the new construction plus the existing private road spur to the
neighbor’s property would exceed the impervious surface limit provision
in the local ordinance.
Considerations for Findings
A good record and findings help keep communities out of lawsuits and help them prevail if they find
themselves in one. In evaluating the facts and developing findings for this variance request, all of the
following statutory criteria must be satisfied, in addition to any local criteria:
Is the variance in harmony with the purposes and intent of the ordinance?
Considering a variance request is a balancing test that requires weighing the need of an individual
property owner against the purposes of the shoreland regulations for protecting the public interest.
These purposes are derived from Minnesota Shoreland Rules, which established impervious surface
caps to prevent excessive runoff from constructed surfaces. Such excessive runoff causes erosion,
transport of pollutants to public waters thereby degrading water quality. Considerations: Will
deviating from the required limit on this property undermine the purposes and intent of the
ordinance? Why or why not? Is it possible to mitigate the consequences of additional impervious
surface on-site such that additional runoff will not be produced? Would this mitigation be in harmony
with the purposes and intent of the ordinance? Why or why not?
Is the variance consistent with the comprehensive plan?
The local comprehensive plan establishes a framework for achieving a community’s vision for the
future. Most plans contain goals and policies for protecting natural resources and shorelands, as well
as maps that identify areas of high risk or with high ecological value where development should be
avoided. The variance request must be considered with these goals and policies in mind. Maps should
be consulted to determine if the property is within any areas identified for protection. Considerations:
Which goals and policies apply? Is allowing additional impervious surface and runoff consistent with
these goals and policies? Why or why not?
Impervious Surfaces
Page 2 of 2 Variance Guidance Series – ISC, Updated 10/10/2012
Are there unique circumstances to the property not created by the landowner?
Unique circumstances relate to physical characteristics of the land - such as lot dimensions, steep
slopes, poor soils, wetlands, and trees. These do not include physical limitations or personal
circumstances created by the property owner that prevent compliance with the impervious surface
provision, such as size of home or design preferences. Consider what distinguishes this property from
other shoreland properties to justify why the applicant should be able to deviate from the provision
when others must comply. Considerations: What physical characteristics are unique to this property
that prevent compliance with the requirement? Were any difficulties in meeting the impervious
surface limit created by some action of the applicant? Has the applicant demonstrated no other
feasible alternatives exist that would not require a variance, such as increasing the setback to reduce
driveway length or reducing the lakehome’s footprint?
Will the variance, if granted, alter the essential character of the locality?
Consider the size of the proposed structure, the extent of encroachment, and how it relates to the
shoreline and hydrology of the riparian area. A large addition located close to the shoreline can
detract from the natural appearance and character of the lake and its riparian areas and degrade water
quality by altering topography, drainage, and vegetation in the riparian area, negatively affecting
recreational, natural, and economic values. Considerations: Does the variance provide minimal relief
or a substantial deviation from the required setback? Does it affect the natural appearance of the
shore from the lake? Does it affect the hydrology of the riparian area?
Does the proposal put property to use in a reasonable manner?
Examine the reasons that the variance is requested and evaluate them in light of the purposes of the
local shoreland ordinance and the public water resource at stake. Since the impervious surface cap is
generally intended to reduce runoff to public waters, it may not be appropriate to allow large areas of
constructed surfaces so close to the water. Considerations: Has the applicant demonstrated that the
proposed construction is reasonable in this location given the sensitive nature of the area and the
purposes of the regulations? Why or why not?
Note: The last three criteria address practical difficulties. Economic considerations alone cannot create practical difficulties
Range of Outcomes
Based on the findings, several outcomes can occur:
If the applicant fails to prove that all criteria above are met, then the variance must be denied. For example,
the local government could find that the building plans itself created the circumstances necessary for a
variance rather than the any unique physical characteristics of the property.
If the applicant demonstrates that all criteria are met, then the variance may be granted. For example, the
local government could find that the construction footprint is reasonable, the circumstances are unique given
the adjacent wetland, and the minor deviation in the impervious surface coverage does not alter the
hydrology of the area (as determined through runoff calculations).
If the variance is granted and the impervious surface in any way alters the hydrology of the area, then
conditions may be imposed, such as to increase the structure setback from the lake by 15 feet to reduce the
extent of the driveway and minimize the amount of impervious surface coverage over the limit.
Conditions on Variances
If findings support granting the variance, consideration must be given to the impacts on the public water
and the riparian area and appropriate conditions to mitigate them. Conditions must be directly related and
roughly proportional to the impacts created by the variance. Several examples are provided below:
Modify construction designs (to minimize impact);
Use permeable pavement systems for walkways, driveways, or parking areas (to reduce effective
impervious surface area and infiltrate runoff);
Direct rain gutter discharges away from the public waters and into infiltration basins (to reduce
connected impervious coverage to allow additional areas for infiltration);
Preserve and restore shoreline vegetation in a natural state (to intercept and filter runoff coming
from structures and driveways); and/or
Increase setbacks from the ordinary high water level (to provide infiltration near public waters).
More information at: www.dnr.state.mn.us/waters/watermgmt_section/shoreland/variances.html
1
CITY OF LAKE ELMO
WASHINGTON COUNTY
STATE OF MINNESOTA
RESOLUTION 2017-075
A RESOLUTION RESCINDING RESOLUTION 2017-067 AND APPROVING A VARIANCE
FROM MINIMUM STRUCTURE SETBACK FROM ORDINARY HIGH WATER LEVEL AND
MAXIMUM IMPERVIOUS SURFACE STANDARDS OF THE CITY’S SHORELAND DISTRICT
WHEREAS, the City of Lake Elmo is a municipal corporation organized and existing
under the laws of the State of Minnesota; and
WHEREAS, Scott and Julie Drommerhausen, 9359 Jane Road North, Lake Elmo, MN
55042 (“Applicant”), has submitted an application to the City of Lake Elmo (the “City”) for
variances to allow construction of an approximately 685 square-foot addition, which will replace
an existing deck, to the east of an existing home currently setback 45.4 feet from the Ordinary
High Water Level (OHWL) and maximum impervious surface standards to increase the current
impervious surface percentage from 26.9% to 29.7%.
WHEREAS, notice has been published, mailed and posted pursuant to the Lake Elmo
Zoning Ordinance, Section 154.109; and
WHEREAS, the Lake Elmo Planning Commission held a public hearing on said matter
on June 12, 2017; and
WHEREAS, the Lake Elmo Planning Commission has submitted its report and
recommendation to the City Council as part of a Staff Memorandum dated June 12, 2017; and
WHEREAS, the City Council considered said matter at its June 20, 2017 meeting and
adopted Resolution 2017-067, approving the variance request, subject to the following
conditions of approval:
1) The Applicant shall secure any required permits and plan approvals from the City and other
applicable jurisdictions.
2) The Applicant shall direct appropriate rain gutter discharges into a rain garden (infiltration
basin designed to capture and infiltrate runoff) designed by a professional engineer or
landscape architect and installed under their direction. The rain garden should mitigate the
increased impervious surface of the entire addition to the home (685 square feet); and
WHEREAS, the Council wishes to remove the aforementioned condition of variance
approval that the Applicant shall direct appropriate rain gutter discharges into a rain garden
(infiltration basin designed to capture and infiltrate runoff) designed by a professional engineer or
landscape architect and installed under their direction. The rain garden should mitigate the increased
impervious surface of the entire addition to the home (685 square feet);
2
WHEREAS, the Council now rescinds Resolution 2017-067, and this Resolution is no
longer in effect; and
NOW, THEREFORE, based on the testimony elicited and information received, the
City Council makes the following:
FINDINGS
1) That the procedures for obtaining said Variance are found in the Lake Elmo Zoning
Ordinance, Section 154.109.
2) That all the submission requirements of said Section 154.109 have been met by the
Applicant.
3) That the proposed variance includes the following components:
a) A variance to allow for an addition to an existing single-family detached home
that does not meet the minimum setback from the OHWL or maximum
impervious surface requirements.
4) That the Variance will be located on property legally described as follows: Lots 9 & 10,
Berschen’s Shores, Washington County, Minnesota. PID# 10.029.21.24.0006.
5) That the strict enforcement of Zoning Ordinance would cause practical difficulties and
that the property owner proposes to use the property in a reasonable manner not permitted
by an official control. Specific findings: The subject property was platted prior to
adjustment of the Ordinary High Water of Lake Jane and the adoption of Shoreland
standards by the City, and therefore the lot is much wider than it is long. Because of the
shape of the lot, the Applicant is proposing to expand the home laterally rather than
further encroaching on the current setback of the Ordinary High Water Level.
Additionally, the addition will not expand much more of the footprint of the principal
structure, as a slightly smaller deck that will be torn down exists where the addition is
being proposed. Additionally, although the City’s ordinance does not treat decks as
impervious, many do. If decks were considered impervious, the addition would only add
109 square feet of impervious surface, or an increase of about 0.46%.
6) That the plight of the landowner is due to circumstances unique to the property not
created by the landowner. Specific findings: The property is unique in that it is much
wider than it is long, and the Applicant was not involved in the platting process of this
property nor the adoption of the City’s shoreland standards. The Applicant also was not
involved in any previous variance requests for the subject property.
7) That the proposed variance will not alter the essential character of the locality in which
the property in question is located. Specific findings: The proposed addition is in place of
an existing deck and only slightly increases the footprint of the existing principal structure,
including the existing deck, by 109 square feet. Additionally, the proposed addition does
not further encroach on the existing setback of the principal structure from the OHWL of
3
the property and has a setback from the OHWL similar to those of adjacent principal
structures.
8) That the proposed variance will not impair an adequate supply of light and air to
properties adjacent to the property in question or substantially increase the congestion of
the public streets or substantially diminish or impair property values within the
neighborhood. Specific findings: The proposed addition will not further encroach on the
setback of the existing structure from the OHWL and therefore will not further impair lake
views of neighboring properties and will not impair an adequate supply of light and air. It
also will not increase congestion of public streets or substantially diminish or impair
property values within the neighborhood. Adjacent properties, including the subject
property, have been granted similar variances and are setback a similar distance from the
OHWL.
CONCLUSIONS AND DECISION
Based on the foregoing, Resolution 2017-067 is rescinded and no longer in effect, and the
Applicant’s application for a Variance is granted, subject to the following conditions.
1) The Applicant shall secure any required permits and plan approvals from the City and other
applicable jurisdictions.
Passed and duly adopted this 1st day of August 2017 by the City Council of the City of Lake
Elmo, Minnesota.
__________________________________
Mike Pearson, Mayor
ATTEST:
________________________________
Julie Johnson, City Clerk
Drummerhausen Variance June 22, 2017
Lake Elmo, MN
RAINGARDEN INSTALLATION ESTIMATE FOR ESTABLISHING ESCROW REQUIREMENTS
NO.ITEM UNIT QUANTITY UNIT COST TOTAL
1 Design Process & Design Documents with Stormwater Calculations Hours 10.0 100.00 $1,000.00
2 Establish Elevations, Demo Existing Soils / Haulaway / Disposal with Final Grading Cubic YD 50.0 40.00 $2,000.00
3 Raingarden Soils at 18 inch Depth (80% Coarse Sand with 20% Compost)Cubic YD 40.0 50.00 $2,000.00
4 Raingarden Plantings @ #1 Container Perennials Each 300.0 20.00 $6,000.00
5 Shredded Western Red Cedar Mulch Cubic YD 10.0 100.00 $1,000.00
TOTAL RAINGARDEN PROJECT COSTS $12,000.00
Assumptions: Designed to mitigate approximately 685 square feet of impervious surface
LANDSCAPE ARCHITECTURE, INC. 2350 BAYLESS PLACE ST. PAUL, MN 55114 PHONE 651.646.1020
STAFF REPORT
DATE: 8/1/2017
REGULAR
TO: City Council
FROM: Emily Becker, City Planner
AGENDA ITEM: Hidden Meadows Easement Vacation, Outlot A
REVIEWED BY: Stephen Wensman, Planning Director
BACKGROUND:
Hidden Meadows 1st Addition was approved on 5/16/2006 which included the platting of the Rock Point
Church property and two outlots proposed for a future OP - Open Space Preservation development. The
deadline for final plat application for the OP development was extended from January 2007 to January 2,
2018. With last final plat extension, the owner granted a drainage and utility easement over the
watermain in Outlot A through recording Document 4073144 on July 1, 2016. The Hidden Meadows 2nd
Addition Final Plat was approved by Council on July 5, 2017. The aforementioned easement will need to
be vacated prior to recording of this plat. New easements will be provided with recording of the Final
Plat.
ISSUE BEFORE COUNCIL:
The Council is respectfully being requested to hold a public hearing and consider approval of vacation of
the drainage and utility easement over the watermain in Outlots A, Hidden Meadows.
PROPOSAL DETAILS/ANALYSIS:
The easement vacation is needed in order for Hidden Meadows 2nd Addition to be recorded. New
easements will be put into place as required with the recording of the Hidden Meadows 2nd Addition. A
public hearing is required for an easement vacation according to M.S. 412.851.
FISCAL IMPACT:
None
OPTIONS:
The Council may approve or deny the easement vacation.
RECOMMENDATION:
Staff recommends approval of the request for vacation of the drainage and utility easement over Outlot A,
Hidden Meadows, as recorded by Document 4073144 subject to the following condition:
1) Hidden Meadows 2nd Addition Final Plat must be recorded.
Page 2
“Move to approve Resolution 2017-082 approving the vacation of the drainage and utility easement
over Outlot A, Hidden Meadows as recorded by Document 4073144, subject to one condition as
recommended by Staff.”
ATTACHMENTS:
• Resolution 2017-082
• Recorded Easement, Document 4073144
STATE OF MINNESOTA
COUNTY OF WASHINGTON
CITY OF LAKE ELMO
RESOLUTION NO. 2017-082
A RESOLUTION VACATING A DRAINAGE AND UTILITY EASEMENT OVER OUTLOT A,
HIDDEN MEADOWS
WHEREAS, the City of Lake Elmo (City) is a municipal corporation organized and existing
under the laws of the State of Minnesota; and
WHEREAS, the City Council approved a Preliminary Plat and Conditional Use Permit
for Hidden Meadows 2nd Addition on April 16, 2006 by Resolution 2006-038; and
WHEREAS, PID# 02.029.21.24.0001 is owned by Rockpoint Church, 5825 Kelvin
Avenue North, Lake Elmo, MN 55042 (Owner); and
WHEREAS, the City of Lake Elmo was granted a Permanent Public Roadway and
Utility Easement over a portion of the PID# 02.029.21.24.0001, and this easement was recorded
by the Office of the Registrar of Titles of Washington County on July 1, 2016 as Document
Number 4073144; and
WHEREAS, the City has approved Hidden Meadows 2nd Addition Final Plat by
Resolution 2017-073 on July 5, 2017, which includes PID#s 02.029.21.24.0001; and
WHEREAS, a request has been made to the City Council pursuant to Minnesota Statute
§412.851 to vacate the Public Roadway and Utility Easement recorded on July 1, 2016 as
Document Number 4073144 over a portion of PID# 02.029.21.24.0001, legally described as
follows:
Commencing at the southeasterly corner of said Outlot A; thence North 00 degrees 32
minutes 13 seconds West (assumed bearing) along the easterly line of said Outlot A a distance of
1067.48 feet to the point of beginning of the line to be described; thence on a bearing of WEST a
distance of 613.32 feet; thence northwesterly 45.49 feet along a non-tangential curve concave to
the southwest, having a radius of 76.95 feet, a central angle of 33 degrees 52 minutes 15 seconds
and a chord bearing of North 73 degrees 08 minutes 48 seconds West; thence South 89 degrees
55 minutes 04 seconds West and tangent to last described curve a distance of 12.72 feet; thence
westerly 211.81 feet along a tangential curve concave to the north, having a radius of 2003.92
feet and a central angle of 6 degrees 03 minutes 22 seconds; thence westerly 210.85 feet long a
reverse curve concave to the south, having a radius of 483.60 feet and a central angle of 24
degrees 58 minutes 50 seconds; thence westerly 311.81 feet along a reverse curve concave to the
north, having a radius of 924.85 feet and a central angle 19 degrees 19 minutes 01 second; thence
northerly 123.99 feet along a non-tangential curve concave to the west, having a radius of 563.51
feet, a central angle of 12 degrees 36 minutes 24 seconds and a chord bearing of North 3 degrees
27 minutes 01 seconds West; thence North 9 degrees 33 minutes 58 seconds West, tangent to last
described curve, a distance of 143.11 feet; thence northerly 144.60 feet along a tangential curve
concave to the east, having a radius of 356.27 feet and a central angle of 23 degrees 15 minutes
19 seconds to the northerly line of said Outlot A and said line there terminating. The full width
of said 50 foot easement to be prolonged to terminate at said northerly line of Outlot A.
WHEREAS, the City Clerk reviewed and examined the signatures on said request and
determined that such signatures constituted all of the landowners abutting upon the portion of
easement to be vacated and rededicated; and
WHEREAS, a public hearing to consider the vacation of the Permanent Public Roadway
and Utility Easement was held on the 1st day of August 2017 before the City Council in the Lake
Elmo City Hall located at 3800 Laverne Avenue North at 7:00 p.m. or shortly thereafter after due
published and posted notice had been given, as well as personal mailed notice to all property
owners within 350 feet of the Public Roadway and Utility Easement by the City Clerk on the 19th
day of July 2017 and all interested and affected persons were given an opportunity to voice their
concerns and be heard; and
WHEREAS, the City Council in its discretion has determined that the vacation will
benefit the public interest because:
1) The City has granted Final Plat Approval for Hidden Meadows 2nd Addition, which
includes PID# 02.029.21.24.0001, a portion over which the easement has been recorded,
which will grant the City more appropriate easements for similar purposes.
WHEREAS, the Council, at its meeting on the 1st day of August 2017, considered the
easement vacation request.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF LAKE ELMO, COUNTY OF WASHINGTON MINNESOTA, that such request
for vacation of an existing Public Roadway and Utility Easement is hereby granted in accordance
with the property descriptions provided above, subject to the following condition:
1) Recording of the Hidden Meadows 2nd Addition Final Plat.
BE IT FURTHER RESOLVED, that the Mayor and City Clerk are hereby authorized to
sign all documents necessary to effectuate the intent of this resolution.
Adopted by the Council this 1st day of August 2017.
Effective Date:_______________________
Approved:
________________________________
Mike Pearson, Mayor
Attested by:
________________________________
Julie Johnson, City Clerk
STAFF REPORT
DATE: 8/1/2017
REGULAR
ITEM #:
TO: City Council
FROM: Emily Becker, City Planner
AGENDA ITEM: Hidden Meadows Easement Vacation, Outlot A
REVIEWED BY: Stephen Wensman, Planning Director
BACKGROUND:
Hidden Meadows 1st Addition was approved on 5/16/2006 which included the platting of the Rock Point
Church property and two outlots proposed for a future OP - Open Space Preservation development. The
deadline for final plat application for the OP development was extended from January 2007 to January 2,
2018. With last final plat extension, the owner granted a drainage and utility easement over the
watermain in Outlot A through recording Document 4073144 on July 1, 2016. The Hidden Meadows 2nd
Addition Final Plat was approved by Council on July 5, 2017. The aforementioned easement will need to
be vacated prior to recording of this plat. New easements will be provided with recording of the Final
Plat.
ISSUE BEFORE COUNCIL:
The Council is respectfully being requested to hold a public hearing and consider approval of vacation of
the drainage and utility easement over the watermain in Outlots A, Hidden Meadows.
PROPOSAL DETAILS/ANALYSIS:
The easement vacation is needed in order for Hidden Meadows 2nd Addition to be recorded. New
easements will be put into place as required with the recording of the Hidden Meadows 2nd Addition. A
public hearing is required for an easement vacation according to M.S. 412.851.
FISCAL IMPACT:
None
OPTIONS:
The Council may approve or deny the easement vacation.
RECOMMENDATION:
Staff recommends approval of the request for vacation of the drainage and utility easement over Outlot A,
Hidden Meadows, as recorded by Document 4073144 subject to the following condition:
1) Hidden Meadows 2nd Addition Final Plat must be recorded.
City Council Meeting
August 1, 2017 Item #
Page 2
“Move to approve Resolution 2017-078 approving the vacation of the drainage and utility easement
over Outlot A, Hidden Meadows as recorded by Document 4073144, subject to one condition as
recommended by Staff.”
ATTACHMENTS:
• Resolution 2017-078
• Recorded Easement, Document 4073144
STATE OF MINNESOTA
COUNTY OF WASHINGTON
CITY OF LAKE ELMO
RESOLUTION NO. 2017-078
A RESOLUTION VACATING A DRAINAGE AND UTILITY EASEMENT OVER OUTLOT A,
HIDDEN MEADOWS
WHEREAS, the City of Lake Elmo (City) is a municipal corporation organized and existing
under the laws of the State of Minnesota; and
WHEREAS, the City Council approved a Preliminary Plat and Conditional Use Permit
for Hidden Meadows 2nd Addition on April 16, 2006 by Resolution 2006-038; and
WHEREAS, PID# 02.029.21.24.0001 is owned by Rockpoint Church, 5825 Kelvin
Avenue North, Lake Elmo, MN 55042 (Owner); and
WHEREAS, the City of Lake Elmo was granted a Permanent Public Roadway and
Utility Easement over a portion of the PID# 02.029.21.24.0001, and this easement was recorded
by the Office of the Registrar of Titles of Washington County on July 1, 2016 as Document
Number 4073144; and
WHEREAS, the City has approved Hidden Meadows 2nd Addition Final Plat by
Resolution 2017-073 on July 5, 2017, which includes PID#s 02.029.21.24.0001; and
WHEREAS, a request has been made to the City Council pursuant to Minnesota Statute
§412.851 to vacate the Public Roadway and Utility Easement recorded on July 1, 2016 as
Document Number 4073144 over a portion of PID# 02.029.21.24.0001, legally described as
follows:
Commencing at the southeasterly corner of said Outlot A; thence North 00 degrees 32
minutes 13 seconds West (assumed bearing) along the easterly line of said Outlot A a distance of
1067.48 feet to the point of beginning of the line to be described; thence on a bearing of WEST a
distance of 613.32 feet; thence northwesterly 45.49 feet along a non-tangential curve concave to
the southwest, having a radius of 76.95 feet, a central angle of 33 degrees 52 minutes 15 seconds
and a chord bearing of North 73 degrees 08 minutes 48 seconds West; thence South 89 degrees
55 minutes 04 seconds West and tangent to last described curve a distance of 12.72 feet; thence
westerly 211.81 feet along a tangential curve concave to the north, having a radius of 2003.92
feet and a central angle of 6 degrees 03 minutes 22 seconds; thence westerly 210.85 feet long a
reverse curve concave to the south, having a radius of 483.60 feet and a central angle of 24
degrees 58 minutes 50 seconds; thence westerly 311.81 feet along a reverse curve concave to the
north, having a radius of 924.85 feet and a central angle 19 degrees 19 minutes 01 second; thence
northerly 123.99 feet along a non-tangential curve concave to the west, having a radius of 563.51
feet, a central angle of 12 degrees 36 minutes 24 seconds and a chord bearing of North 3 degrees
27 minutes 01 seconds West; thence North 9 degrees 33 minutes 58 seconds West, tangent to last
described curve, a distance of 143.11 feet; thence northerly 144.60 feet along a tangential curve
concave to the east, having a radius of 356.27 feet and a central angle of 23 degrees 15 minutes
19 seconds to the northerly line of said Outlot A and said line there terminating. The full width
of said 50 foot easement to be prolonged to terminate at said northerly line of Outlot A.
WHEREAS, the City Clerk reviewed and examined the signatures on said request and
determined that such signatures constituted all of the landowners abutting upon the portion of
easement to be vacated and rededicated; and
WHEREAS, a public hearing to consider the vacation of the Permanent Public Roadway
and Utility Easement was held on the 1st day of August 2017 before the City Council in the Lake
Elmo City Hall located at 3800 Laverne Avenue North at 7:00 p.m. or shortly thereafter after due
published and posted notice had been given, as well as personal mailed notice to all property
owners within 350 feet of the Public Roadway and Utility Easement by the City Clerk on the 19th
day of July 2017 and all interested and affected persons were given an opportunity to voice their
concerns and be heard; and
WHEREAS, the City Council in its discretion has determined that the vacation will
benefit the public interest because:
1) The City has granted Final Plat Approval for Hidden Meadows 2nd Addition, which
includes PID# 02.029.21.24.0001, a portion over which the easement has been recorded,
which will grant the City more appropriate easements for similar purposes.
WHEREAS, the Council, at its meeting on the 1st day of August 2017, considered the
easement vacation request.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF LAKE ELMO, COUNTY OF WASHINGTON MINNESOTA, that such request
for vacation of an existing Public Roadway and Utility Easement is hereby granted in accordance
with the property descriptions provided above, subject to the following condition:
1) Recording of the Hidden Meadows 2nd Addition Final Plat.
BE IT FURTHER RESOLVED, that the Mayor and City Clerk are hereby authorized to
sign all documents necessary to effectuate the intent of this resolution.
Adopted by the Council this 1st day of August 2017.
Effective Date:_______________________
Approved:
________________________________
Mike Pearson, Mayor
Attested by:
________________________________
Julie Johnson, City Clerk
STAFF REPORT
DATE: 8/1/2017
REGULAR
MOTION
TO: City Council
FROM: Emily Becker, City Planner
AGENDA ITEM: Shoreland Variance Request to Allow Expansion of an Existing Non-
Conforming Structure Which Does Not Meet Minimum Structure Setback
from Ordinary High Water Level – 8690 Lake Jane Trail North
REVIEWED BY: Stephen Wensman, Planning Director
BACKGROUND:
The City has received application from Glenwood Homes of 10920 Kingsborough Ct S Cottage Grove,
MN 55016 for a variance to allow expansion of a non-conforming structure which does not meet the
required minimum structure setback standard from the Ordinary High Water Level (OHWL) within a
shoreland district of the City’s shoreland ordinance.
ISSUE BEFORE COUNCIL:
The City Council is being asked to consider and approve or deny the above-mentioned variance request.
PROPOSAL DETAILS/ANALYSIS:
Applicant: Glenwood Homes, 10920 Kingsborough Ct, Cottage Grove, MN 55016
Property Owners: Ben and Breanna Pepin, 8690 Lake Jane Trail North, Lake Elmo, MN 55042
Location: 8690 Lake Jane Trail North, PID# 09.029.21.42.0014, Lot 8, Block 1, Lake
Jane Manor No. 1, Washington County, Minnesota
Request: Variance from Shoreland Standard – Expansion of a Non-Conforming
Structure Not Meeting Minimum Structure Setback from the Ordinary High
Water Level
Existing Land Use: Single-Family Detached Residential Dwelling
Surrounding Land
Use:
Surrounded by other single-family detached residential dwellings and abuts
Lake Jane on the northerly side of the property
Existing Zoning: Rural Single Family/Shoreland Overlay District
Comprehensive Plan: Rural Single Family
History: The home was built in 1968, prior to the City’s adoption of its shoreland
ordinance.
Deadline for Action: Application Complete – 6/26/2017
60 Day Deadline – 8/25/2017
Extension Letter Mailed – N/A
120 Day Deadline – N/A
Applicable
Regulations:
Article V – Zoning Administration and Enforcement
Article XIX – Shoreland Management Overlay District
Page 2
Request Details. The applicant is proposing to construct a 640 square foot addition, 196 square foot
porch, 188 square foot patio, 626 square foot addition to his garage (including a 129 square foot storage
area), and a 12 foot X 10 foot temporary storage structure on the existing concrete pad to the east of the
proposed addition. The applicant is not able to expand the home on the front side of the house due to
septic setback standards and cannot expand the garage on the west side of the existing garage due to side
yard setback standards and so is requesting that the expansions be made to the side and rear of the lot. The
current home is currently non-conforming in that it is setback approximately 75 feet from the OHWL, and
the required structure setback from the OHWL is 100 feet.
Lot Details. The property meets all setbacks for the Rural Single Family Zoning district but does not
meet the minimum lot size requirement of 1.5 acres.
• Area: 29,195 square feet (0.67 acres)
• Front yard setback: 92.2 feet (40 feet required)
• Side yard setback (west): 16.4 feet (10 feet required)
• Proposed side yard setback (east): Approximately 28 feet (10 feet required)
• Proposed structure setback from OHWL: 75.1 feet (100 feet required)
• Proposed septic setbacks: approximately 32 feet from septic equipment and approximately 60
feet from drainfield (10 and 20 feet required, respectively)
• Existing Impervious Surface: 23.7% (6921 sf) (maximum 15% allowed)
• Proposed Impervious Surface Area: 23.2% (6772 sf) (maximum 15% allowed)
• Septic Permit Needs. The proposed addition will include a guest bedroom but will also convert an
existing bedroom in to living space and therefore no septic permit or inspection is required.
Impervious Surface. The existing amount of impervious surface on the lot totals 23.7%, which exceeds
the maximum amount allowed of 15%. The proposal also includes removing 235 square feet of
bituminous surface along with 1553 square feet of concrete (a total of 1788 square feet of impervious
surface), reducing the total impervious surface area on the property to 23.2%. It is a recommended
condition of approval that the escrow for the building permit include the cost of removal of the
impervious surface to ensure that the impervious surface on the lot does not increase as a result of the
proposed additions.
Nonconformities within a Shoreland. The City’s Shoreland Ordinance states that all additions or
expansions to the outside dimensions of an existing nonconforming structure must meet the setback,
height, and other requirements of the Shoreland Ordinance. Any deviation from these requirements must
be authorized by a variance. It should be noted that this provision in the ordinance was not drastically
changed in the 2017 amendment to the Shoreland Section of the Zoning Code, as previously an
improvement to a riparian substandard structure was allowed to extend laterally by a conditional use
permit (as opposed to a variance), provided it was in compliance with all other dimensional standard.
There is also a provision that allows setback averaging where structures exist on the adjoining lots on
both sides of a proposed building site, but the existing home on the subject lot is closer to the OHWL than
those of adjoining properties.
Minnesota Department of Natural Resources (MNDNR) Review. Per State Statute, the City is
required to notify the MNDNR of variance requests within a shoreland district. The MNDNR has
reviewed and responded to this variance request, and their response is attached to this report. The
MNDNR has recommended that if this variance is granted, that the City include the condition that the
impervious surface created by the further encroachment of the structure within the required setback from
the OHWL be mitigated. The MNDNR has specifically recommended that the condition be that the
Applicant direct rain gutter discharges into a rain garden (infiltration basin designed to capture and
infiltrate runoff). However, because the Applicant is actually reducing the impervious surface on the lot,
especially that within the required structure setback from the OHWL, Staff did not recommend to the
Page 3
Planning Commission that this condition be added. This condition had been recommended by Staff in
previous variance requests due to MNDNR recommendation, but that was because the impervious surface
was increased.
PLANNING COMMISSION REVIEW:
The Planning Commission held a public hearing and considered the variance request at its July 24,
2017 meeting. The public notice was mailed to property owners within 350 feet and published in the
official City newspaper. No public comments were received prior to the public hearing, though two
nearby property owners (Kelly and Susan Schmidt of 8644 Lake Jane Trail N and John Mayek of
8680 Lake Jane Trail N) wrote letters in support of the requested variance.
The Planning Commission had the following comments in regards to the requested variance:
There was concern about meeting the required finding that the plight of the landowner was due to
circumstances unique to the property not created by the landowner. Some felt that the landowner
should have been aware of the shoreland ordinance standards and that the home was non-conforming
and therefore could not be expanded.
Some felt that the recommendation made by the MNDNR that a mitigation condition (such as
directing gutter discharges in to an infiltration basin) be added to the variance approval should be
followed, as it could further protect the lake.
The Planning Commission voted to recommend adding the following findings (added to the Unique
Circumstances criteria – Finding #3):
• The proposed additions do not increase the degree of non-conformity.
• The amount of impervious surface is not being increased.
The Planning Commission voted to recommend adding the following conditions to the variance
approval:
3) The Applicant shall either (at the Applicant’s option) use pervious pavers on the
proposed patio area or construct a rain garden (at a size as recommended by the Valley
Branch Watershed District) to contain runoff.
RECOMMENDED FINDINGS:
An applicant must establish and demonstrate compliance with the variance criteria set forth in Lake
Elmo City Code Section 154.017 before an exception or modification to city code requirements can
be granted. These criteria are listed below, along with recommended findings from Staff and the
Planning Commission regarding applicability of these criteria to the applicant’s request.
1) Practical Difficulties. A variance to the provision of this chapter may be granted by the Board
of Adjustment upon the application by the owner of the affected property where the strict
enforcement of this chapter would cause practical difficulties because of circumstances unique to
the individual property under consideration and then only when it is demonstrated that such
actions will be in keeping with the spirit and intent of this chapter. Definition of practical
difficulties - “Practical difficulties” as used in connection with the granting of a variance, means
that the property owner proposes to use the property in a reasonable manner not permitted by an
official control.
FINDINGS: The subject property was platted and the house was built prior to adoption of
Shoreland standards by the City and therefore the house does not meet the minimum structure
Page 4
setback requirement from the Ordinary High Water Level and is legal non-conforming. The property
owner wants to expand the current home and garage, and because of the location of the septic tank
and septic mound in the front yard as well as the location of the garage near the side yard, it is not
an option to do so in the front of the existing house or on the side of the existing garage.
2) Unique Circumstances. The plight of the landowner is due to circumstances unique to the
property not created by the landowner.
FINDINGS: The property owner did not plat the lot or construct the original home, which were both
done prior to adoption of the City’s shoreland standards.
3) Character of Locality. The proposed variance will not alter the essential character of the
locality in which the property in question is located.
FINDINGS: The proposed additions do not encroach any further than the existing deck in to the
setback from the Ordinary High Water Level of Lake Jane, and therefore the degree of non-
conformity is not being increased. The proposed addition will not further impair lake views for
adjacent or nearby property owners. Additionally, the proposed additions will not increase the
amount of impervious surface on the property; rather the Applicant will decrease the total amount of
impervious surface on the property by removing existing concrete and bituminous surface.
4) Adjacent Properties and Traffic. The proposed variance will not impair an adequate supply of
light and air to properties adjacent to the property in question or substantially increase the
congestion of the public streets or substantially diminish or impair property values within the
neighborhood.
FINDINGS. The proposed additions will not further impair lake views of neighboring properties.
They also will not increase congestion of public streets or substantially diminish or impair property
values within the neighborhood.
FISCAL IMPACT:
None.
OPTIONS:
The Council may:
• Adopt Resolution 2017-083 approving the variance request with the recommended conditions of
approval.
• Amend recommended conditions of approval and adopt Resolution 2017-083 as amended.
• Not adopt Resolution 2017-083 and deny the variance request.
RECOMMENDATION:
Staff and the Planning Commission recommend the Council adopt Resolution 2017-083, approving
the request by Glenwood Homes for a shoreland variance request to allow expansion of a non-
conforming structure not meeting the minimum structure setback requirement from the Ordinary
High Water Level for the property located at 8690 Lake Jane Trail North, subject to the following
conditions of approval:
Page 5
1) The Applicant shall secure any required permits and plan approvals from the City and other
applicable jurisdictions.
2) The Applicant shall provide an escrow in the amount of an estimated cost of the removal of
the existing bituminous and concrete surface as shown on the proposed survey.
3) The Applicant shall either (at the Applicant’s option) use pervious pavers on the proposed
patio area or construct a rain garden (at a size as recommended by the Valley Branch
Watershed District) to contain runoff.
The suggestion motion for taking action on the recommendation is as follows:
“Move to adopt Resolution 2017-083, approving a shoreland variance to allow the expansion of a
non-conforming structure not meeting the minimum structure setback requirement from the
Ordinary High Water Level for the property located at 8690 Lake Jane Trail N, subject to
conditions of approval as recommended by Staff and the Planning Commission.”
ATTACHMENTS:
• Application with narrative and survey
• MNDNR comments
• Resolution 2017-083
From:Sorensen, Jenifer (DNR)
To:Emily Becker
Subject:RE: Lake Jane Variance Request 8690 Lake Jane Trail North
Date:Friday, July 07, 2017 10:16:13 AM
Yes, I’d like to include this comment. Since the structure is expanding toward the shoreline, this
would seem like a reasonable expectation to have the landowner construct the gutters such that
they redirect the runoff to an area of infiltration.
Thanks –
Jen
Jenifer Sorensen
East Metro Area Hydrologist (Ramsey and Washington Counties)
Division of Ecological and Water Resources
Minnesota Department of Natural Resources
1200 Warner Road
St Paul, MN 55106
Phone: 651-259-5754
Email: jenifer.sorensen@state.mn.us
From: Emily Becker [mailto:EBecker@lakeelmo.org]
Sent: Friday, July 07, 2017 9:26 AM
To: Sorensen, Jenifer (DNR) <jenifer.sorensen@state.mn.us>
Subject: RE: Lake Jane Variance Request 8690 Lake Jane Trail North
Jen,
As noted in the application, the impervious surface will in fact be decreased, as they will be removing
existing asphalt and bituminous surface. Please let me know that you saw this and if you still
recommend that they install the rain garden.
Emily Becker
City Planner
City of Lake Elmo
651-747-3912
ebecker@lakeelmo.org
From: Sorensen, Jenifer (DNR) [mailto:jenifer.sorensen@state.mn.us]
Sent: Thursday, July 06, 2017 7:01 PM
To: Emily Becker <EBecker@lakeelmo.org>
Subject: RE: Lake Jane Variance Request 8690 Lake Jane Trail North
Emily –
MNDNR has the following comment for the variance request for 8690 Lake Jane Trail North to
expand the existing residential structure:
· If a variance is granted for this project, MNDNR recommends that the City of Lake Elmo
include condition on the variance that mitigates for the impervious surface created by the
further encroachment of the structure within the OHW setback, such as:
· Direct rain gutter discharges into a rain garden (infiltration basin designed to capture
and infiltrate runoff).
Thank you for the opportunity to comment on this variance request.
Jen
Jenifer Sorensen
East Metro Area Hydrologist (Ramsey and Washington Counties)
Division of Ecological and Water Resources
Minnesota Department of Natural Resources
1200 Warner Road
St Paul, MN 55106
Phone: 651-259-5754
Email: jenifer.sorensen@state.mn.us
From: Emily Becker [mailto:EBecker@lakeelmo.org]
Sent: Friday, June 30, 2017 11:02 AM
To: Sorensen, Jenifer (DNR) <jenifer.sorensen@state.mn.us>
Subject: Lake Jane Variance Request 8690 Lake Jane Trail North
Jen,
Attached is another shoreland variance request and very rough draft staff report. Please note that
the impervious surface will not actually increase, it will decrease, as they are proposing to remove
existing impervious surface. The public hearing will be held on July 24, so please have any comments
in by July 19th at the latest.
Emily Becker
City Planner
City of Lake Elmo
651-747-3912
ebecker@lakeelmo.org
1
CITY OF LAKE ELMO
WASHINGTON COUNTY
STATE OF MINNESOTA
RESOLUTION 2017-083
A RESOLUTION APPROVING A VARIANCE TO ALLOW EXPANSION OF A NON-
CONFORMING STRUCTURE NOT MEETING MINIMUM STRUCTURE SETBACK
REQUIREMENTS FROM THE ORDINARY HIGH WATER LEVEL OF THE CITY’S
SHORELAND DISTRICT
WHEREAS, the City of Lake Elmo is a municipal corporation organized and existing
under the laws of the State of Minnesota; and
WHEREAS, Glenwood Homes, 10920 Kingsborough Ct, Cottage Grove, MN 55016
(“Applicant”), has submitted an application to the City of Lake Elmo (the “City”) for a variance
to allow the expansion of a non-conforming structure not meeting the minimum structure setback
requirement from the Ordinary High Water Level (OHWL). The proposed additions to the
structure do not encroach further in to the existing setback of 73.6 feet from the OHWL and
include a 640 square foot addition; 196 square foot porch; 188 square foot patio; 626 square foot
addition to his garage (including a 129 square foot storage area); and a 12 foot X 10 foot
temporary storage structure on the existing concrete pad to the east of the proposed addition.
WHEREAS, notice has been published, mailed and posted pursuant to the Lake Elmo
Zoning Ordinance, Section 154.109; and
WHEREAS, the Lake Elmo Planning Commission held a public hearing on said matter
on July 24, 2017; and
WHEREAS, the Lake Elmo Planning Commission has submitted its report and
recommendation to the City Council as part of a Staff Memorandum dated July 24, 2017; and
WHEREAS, the City Council considered said matter at its August 1, 2017 meeting.
NOW, THEREFORE, based on the testimony elicited and information received, the
City Council makes the following:
FINDINGS
1) That the procedures for obtaining said Variance are found in the Lake Elmo Zoning
Ordinance, Section 154.109.
2) That all the submission requirements of said Section 154.109 have been met by the
Applicant.
2
3) That the proposed variance includes the following components:
a) A variance to allow for additions to an existing single-family detached home that
does not meet the minimum structure setback requirement from the OHWL.
4) That the Variance will be located on property legally described as follows: Lot 8, Block
1, Lake Jane Manor No. 1, Washington County, Minnesota, PID# 09.029.21.42.0014.
5) That the strict enforcement of Zoning Ordinance would cause practical difficulties and
that the property owner proposes to use the property in a reasonable manner not permitted
by an official control. Specific findings: The subject property was platted and the house
was built prior to adoption of Shoreland standards by the City and therefore the house does
not meet the minimum structure setback requirement from the Ordinary High Water Level
and is legal non-conforming. The property owner wants to expand the current home and
garage, and because of the location of the septic tank and septic mound in the front yard as
well as the location of the garage near the side yard, it is not an option to do so in the front
of the existing house or on the side of the existing garage.
6) That the plight of the landowner is due to circumstances unique to the property not
created by the landowner. Specific findings: The property owner did not plat the lot or
construct the original home. Both were done prior to adoption of the City’s shoreland
standards.
7) That the proposed variance will not alter the essential character of the locality in which
the property in question is located. Specific findings: The proposed additions do not
encroach any further than the existing deck in to the setback from the Ordinary High
Water Level of Lake Jane, and therefore the degree of non-conformity is not being
increased. The proposed addition will not further impair lake views for adjacent or
nearby property owners. Additionally, the proposed additions will not increase the
amount of impervious surface on the property; rather the Applicant will decrease the
total amount of impervious surface on the property by removing existing concrete and
bituminous surface.
8) That the proposed variance will not impair an adequate supply of light and air to
properties adjacent to the property in question or substantially increase the congestion of
the public streets or substantially diminish or impair property values within the
neighborhood. Specific findings: The proposed additions will not further impair lake
views of neighboring properties. They also will not increase congestion of public streets
or substantially diminish or impair property values within the neighborhood.
CONCLUSIONS AND DECISION
Based on the foregoing, the Applicant’s application for a Variance is granted, subject to the
following conditions.
1) The Applicant shall secure any required permits and plan approvals from the City and other
applicable jurisdictions.
3
2) The Applicant shall provide an escrow in the amount of an estimated cost of the removal of
the existing bituminous and concrete surface as shown on the proposed survey.
3) The Applicant shall either (at the Applicant’s option) use pervious pavers on the proposed
patio area or construct a rain garden (at a size as recommended by the Valley Branch
Watershed District) to contain runoff.
Passed and duly adopted this 1st day of August 2017 by the City Council of the City of Lake
Elmo, Minnesota.
__________________________________
Mike Pearson, Mayor
ATTEST:
________________________________
Julie Johnson, City Clerk
STAFF REPORT
DATE: August 1, 2017
REGULAR
TO: City Council
FROM: Brian A. Swanson – Finance Director
AGENDA ITEM: Presentation of 2016 Comprehensive Annual Financial Report (CAFR)
REVIEWED BY: Kristina Handt – City Administrator
BACKGROUND:
Annually, the City engages the services of an independent outside audit firm to audit and assist with the
preparation of the financial statements. The auditors are asked to assure that the financial statements are
free from material misstatement in accordance with U.S. Generally Accepted Accounting Principles
(GAAP). The firm also performs testing and makes inquiries to help ensure that proper internal controls
are in place. This is the fourth year that the City of Lake Elmo has presented the report in the
Comprehensive Annual Financial Report (CAFR) layout.
As such, the City has retained the services of Smith Schafer & Associates, Ltd., to perform the City of
Lake Elmo’s audit for 2016. The 2016 Comprehensive Annual Financial Report and Management Report
will be presented to the City Council by Mr. Jason Miller – Principal, from Smith Schafer and Associates,
Ltd. with the opportunity to ask questions of both Mr. Miller and City Staff.
An overview summary of the 2016 CAFR and results were presented to the Finance Committee on July
27, 2017. Copies of the report were provided to the Finance Committee and it was unanimously agreed to
recommend that the report be presented to the City Council.
QUESTION BEFORE THE CITY COUNCIL:
1) Does the City Council have any questions regarding the 2016 CAFR?
DISCUSSION:
Mr. Jason Miller – Principal, from Smith Schafer and Associates, Ltd., will present information
regarding the 2016 Audit, answer any questions the City Council may have, with staff also present
to answer any questions pertaining to the 2016 Audit and 2016 CAFR.
FISCAL IMPACT:
Overall sound policies, fiscal management, effective operational, capital, and long range planning are all
integral parts of City business leading up to the audit and completion of the CAFR. As such, continued
investment in the aforementioned items will help position the City to continue to provide quality,
efficient, timely and cost effective services to the constituents of the community.
RECOMMENDATION:
1) No formal recommendation is required, but the City Council at its discretion may accept the
results of the 2016 Audit and 2016 CAFR.
ATTACHMENT:
1) 2016 Comprehensive Annual Financial Report
CITY OF LAKE ELMO, MINNESOTA
COMPREHENSIVE ANNUAL
FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED
DECEMBER 31, 2016
PREPARED BY:
FINANCE DEPARTMENT
CITY OF LAKE ELMO, MINNESOTA
PAGE
INTRODUCTORY SECTION
Letter of Transmittal i
GFOA Certificate of Achievement v
Elected and Appointed Officials vi
Organizational Chart vii
FINANCIAL SECTION
Independent Auditor's Report 1
Management's Discussion and Analysis 3
Basic Financial Statements
Government-wide Financial Statements
Statement of Net Position 14
Statement of Activities 15
Fund Financial Statements
Balance Sheet - Governmental Funds 17
Reconciliation of Net Position in the Government-wide
Financial Statements and Fund Balances in the Fund
Basis Financial Statements 19
Statement of Revenues, Expenditures, and Changes in
Fund Balances - Governmental Funds 20
Reconciliation of the Statement of Revenues, Expenditures,
and Changes in Fund Balances of Governmental Funds
to the Statement of Activities 22
Statement of Revenues, Expenditures, and Changes in
Fund Balances - Budget and Actual - General Fund 23
Combining Statement of Net Position - Proprietary Funds 27
Combining Statement of Revenues, Expenses and Changes in
Net Position - Proprietary Funds 31
Combining Statement of Cash Flows - Proprietary Funds 33
Statement of Fiduciary Net Position - Fiduciary Funds 35
Notes to Financial Statements 36
Required Supplemental Information
Schedule of City Contributions
General Employees Retirement Plan 84
Public Employees Police and Fire Plan 84
Schedule of Proportionate Share of Net Pension Liability
General Employees Retirement Plan 85
Public Employees Police and Fire Plan 85
City of Lake Elmo Fire Relief Association
Schedule of Funding Progress for the Fire Relief Association 86
Schedule of Employer Contributions for the Fire Relief Association 86
Schedule of Funding Progress - Other Post Employment Benefits 87
Combining and Individual Fund Statements and Schedules
Combining Balance Sheet - Nonmajor Governmental Funds 88
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances - Nonmajor Governmental Funds 89
Combining Balance Sheet - Nonmajor Special Revenue Funds 90
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances - Nonmajor Special Revenue Funds 91
TABLE OF CONTENTS
CITY OF LAKE ELMO, MINNESOTA
For the Fiscal Year Ended December 31, 2016
FINANCIAL STATEMENTS
PAGE
FINANCIAL SECTION (CONTINUED)
Combining Balance Sheet - Nonmajor Capital Projects Funds 92
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances - Nonmajor Capital Projects Funds 94
Combining Statement of Net Position - Internal Service Funds 96
Combining Statement of Revenues, Expenses and Changes in Fund
Net Position - Internal Service Funds 97
Combining Statement of Cash Flows - Internal Service Funds 98
Combining Balance Sheet - Debt Service Funds 99
Combining Schedule of Revenues, Expenditures and Changes in Fund
Balances - Debt Service Funds 101
Schedule of Revenues, Expenditures and Changes in Fund Balances -
Budget and Actual - City Events Special Revenue Fund 103
Schedule of Revenues, Expenditures and Changes in Fund Balances -
Budget and Actual - Library Special Revenue Fund 104
Combining Schedule of Changes in Assets and Liabilities - Agency Funds 105
Supplemental Schedule of Sources and Uses - Redevelopment Grant Program 106
STATISTICAL SECTION (UNAUDITED)REFERENCE
Net Position by Component Schedule 1 107
Changes in Net Position Schedule 2 109
Fund Balances, Governmental Funds Schedule 3 113
Changes in Fund Balances, Governmental Funds Schedule 4 115
Tax Capacity and Estimated Actual Value of Taxable Property Schedule 5 117
Property Tax Rates and Tax Levies - Direct and Overlapping Property
Tax Rates Schedule 6 118
Principal Property Taxpayers Schedule 7 119
Schedule of Property Tax Levies and Collections Schedule 8 120
Water and Sanitary Sewer Charges by Customer Schedule 9 122
Ratios of Outstanding Debt by Type Schedule 10 124
Ratios of General Bonded Debt Outstanding Schedule 11 126
Computation of Direct and Indirect General Obligation Bonded Debt
and Legal Debt Margin Schedule 12 128
Legal Debt Margin Information Schedule 13 129
Pledged Revenue Coverage Schedule 14 131
Demographic and Economic Statistics Schedule 15 132
Principal Employers Schedule 16 133
Full-Time Equivalent Employees by Function Schedule 17 134
Operating Indicators by Function/Program Schedule 18 136
Capital Assets Statistics by Function/Program Schedule 19 138
OTHER REPORT SECTION
Independent Auditor's Report on Minnesota Legal Compliance 139
CITY OF LAKE ELMO, MINNESOTA
FINANCIAL STATEMENTS
For the Fiscal Year Ended December 31, 2016
TABLE OF CONTENTS (CONTINUED)
CITY OF LAKE ELMO, MINNESOTA
INTRODUCTORY SECTION
DECEMBER 31, 2016
This Page Left Blank Intentionally
i
3800 Laverne Avenue North
Lake Elmo, MN 55042
651-747-3900 www.lakeelmo.org
June 29, 2017
To the Honorable Mayor, Members of the City Council, and Citizens of the
City of Lake Elmo:
Minnesota Statutes require all cities to issue an annual report on its financial position and activity
prepared in accordance with generally accepted accounting principles (GAAP), under the
guidance of the Government Accounting Standard Board (GASB), and audited in accordance with
generally accepted auditing standards (GAAS) by a firm of licensed certified public accountants
or the Office of the State Auditor. Pursuant to that requirement, we hereby issue the
comprehensive annual financial report of the City of Lake Elmo, MN for the fiscal year ended
December 31, 2016.
This report consists of management’s representation concerning the finances of the City of Lake
Elmo. Consequently, management assumes full responsibility for the completeness, accuracy
and reliability of all the information presented in this report. To provide a reasonable basis for
making these representations, the management of the City of Lake Elmo has established a
thorough internal control system designed to both protect the City’s assets from loss, theft and
misuse and to compile all necessary information for the preparation of the City of Lake Elmo’s
financial statements in conformity with GAAP and GASB. As a management team, we assert that
the financial statements will be free from material misstatement and that the financial report is
reliable in all material respects.
The City of Lake Elmo’s financial statements have been audited by Smith, Schafer and
Associates, Ltd, a firm of licensed certified public accountants. The goal of the independent audit
was to provide reasonable assurance that the financial statements of the City of Lake Elmo for
the fiscal year ended December 31, 2016 are free from material misstatement. The independent
audit involved examining, on an approved test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles used and significant
estimates made by management and evaluating the overall financial statement presentation. The
independent auditor concluded, based upon the audit that there was a reasonable basis for
rendering an unmodified opinion that the City of Lake Elmo’s financial statements for fiscal year
ended December 31, 2016 are fairly presented in conformity with GAAP. The independent
auditor’s report is presented as the first component of the financial section of the report.
ii
A “Single Audit” designed to meet the special needs of a federal grantor agency was not
performed for the year ended December 31, 2016 as the City did not participate in any programs
that required this additional independent audit.
GAAP requires that management provide a narrative introduction, overview, and analysis to
accompany the basic financial statements in form of the Management’s Discussion and Analysis
(MD&A). This letter of transmittal is included to complement the MD&A and should be read in
conjunction with it. The City of Lake Elmo’s MD&A can be found immediately following the report
of the independent auditors.
PROFILE OF THE GOVERNMENT
The City of Lake Elmo was incorporated in 1926 and is a statutory city in the State of Minnesota
six miles east of St. Paul Minnesota. Located in Washington County, it covers 25 square miles
and has an estimated population of 9,000 which represents 3,100 households.
Policy-making and legislative authority are vested in a governing council consisting of an elected
Mayor and four council members. Per Minnesota State Statute, the governing council is
responsible for passing ordinances, adopting an annual budget, appointing committees and hiring
both the city’s administrator and attorney. The City Administrator is responsible for carrying out
the policies and ordinances of the governing council and overseeing the day-to-day operations of
the city. The Council is elected on a non-partisan basis. The Mayor serves a four-year term and
council members serve a four-year staggered term, with two of these positions elected every two
years. The Mayor and the Council are elected at-large.
The City of Lake Elmo provides a full range of Services including fire protection services,
construction and maintenance of streets and infrastructure; recreational facilities; and water,
sanitary sewer and storm water utility services. The City contracts with the Washington County
Sheriff’s Department for police services.
The annual budget serves as the foundation for the City of Lake Elmo’s financial management
and fiscal stewardship. City departments and agencies of the City submit their requested budget
to the City Administrator and the Finance Director in order to compile a preliminary budget for
submission to the Finance Committee for their consideration. The Finance Committee then meets
with the Department Heads to better understand their proposed budgets to later submit a budget
to the City Council. The preliminary balanced budget is presented to the City Council in
September each year so that the preliminary property tax levy can be submitted to Washington
County by the annual due date. The preliminary property tax levy may be decreased but not
increased. The 2016 Adopted Budget and final property tax levy was required to be adopted by
and submitted to Washington County by December 28, 2015. Included in the City annual budget
process is the compilation of a Capital Improvement Plan which allows for strategic planning of
City infrastructure and equipment needs while maintaining a reasonable level of debt and a strong
unassigned fund balance. Monthly budget to actual comparison reports are provided to the
Finance Committee and the City Council to keep them apprised of the financial performance of
the City.
iii
FACTORS AFFECTING FINANCIAL CONDITION
The information presented in the financial statements is perhaps best understood when it is
considered from the broader perspective of the specific environment within which the City of Lake
Elmo operates.
LOCAL ECONOMY
Lake Elmo is home to numerous businesses that are leaders in their respective industries. New
residential developments platted since 2014 number approximately 2,200 have been approved.
The City’s highway infrastructure continues to make Lake Elmo a desirable residential location.
Rapid growth is further reflected in 2016 population estimates of 9,000 or an increase of 10%
since the 2010 census.
New housing starts in 2016 numbered 252 with a total value of $79,884,649 and an average value
of $317,003. Commercial new construction numbered 4 with a total value of $32,058,022 and an
average value of $8,014,505. All these new start have been built in 2016 or will be finished in
2017, which will greatly strengthen the existing tax base of the City.
LONG TERM FINANCIAL PLANNING
Total unassigned General Fund balance as of December 31, 2016 was 89% of the total 2016
General Fund expenditures. Although the State Auditor recommends maintaining a level of 35%
- 50%, the City has consistently exceeded that rate, showing the City’s financial strength.
The City’s 5-year Capital Improvement Plan serves as the foundation for long-term financial
planning. Funding needs for capital replacements are reflected in tax levies for the street renewal
and general fund asset replacements. Funding needs for capital infrastructure in the enterprise
funds are funded through user fees in those funds.
During 2016, Moody’s Investors Service maintained the City's long term debt rating of Aa2. In
their assessment of the City, Moody’s noted the following:
Strong financial operations supported by healthy reserves and liquidity
Healthy unassigned fund balance
Affluent tax base favorably located in Twin Cities metropolitan area
Projections for the next 5 years indicate that property tax contributions, user fees and investment
income will continue to grow based on planned development and expansion within the City.
RELEVANT FINANCIAL POLICIES
During 2015, the Metropolitan Council issued the 2015 System Statement for the City of Lake
Elmo which outlines the updated forecasts for the City as a result of the termination in 2014 of the
Memorandum of Understanding (MOU). The previous forecasted population number for 2040
was reduced from 20,500 to 18,200. Receipt of the system statement plans triggers a community
obligation to review and amend its comprehensive plan as necessary, which began late in 2016
and will continue into 2017.
iv
MAJOR INITIATIVES
2016 was an extremely robust year for the City due to continuation of on-going infrastructure
upgrades, projects, as well as oversight of the on-going residential and commercial development
activity.
Some of the 2016 infrastructure projects included the following:
Joint project with Washington County on CSAH 17. This project included the replacement
of old water main and installation of sanitary sewer and storm sewer while reconstructing
the streets.
Continued work with the Union Pacific Railroad regarding the downtown project and a new
development impacting the Railroad at various locations.
Construction of a lift station, pump house, well and water tower
2016 seal coating and crack filling project
Use of Parkland dedication fees to continue to make improvements to existing parks and
providing oversight to the new City parks being constructed by developers.
2016 street reconstruction in the Stonegate, Kirkwood and Kelvin Avenue neighborhoods
including the extension of water service to Kelvin Avenue homes.
AWARDS AND ACKNOWLEDGEMENTS
The Government Finance Officers Association (GFOA) of the United States and Canada awarded
a Certificate of Achievement for Excellence in Financial Reporting (CAFR) to the City again for
the fiscal year ending December 31, 2015. This certificate is a prestigious national award
recognizing conformance with the highest standards for preparation for state and local
government financial reports.
In order to be awarded a Certificate of Achievement, a government unit must publish an easily
readable and efficiently organized CAFR, whose contents conform to program standards. Such
reports must satisfy both accounting principles generally accepted in the United States of America
and applicable legal requirements. A certificate is valid for one year only.
The City of Lake Elmo is pleased to present its Comprehensive Annual Financial Report, which
will be submitted to the Government Finance Officers Association (GFOA) for consideration of a
Certificate of Achievement for Excellence in Financial Reporting for its financial reports for the
fiscal year ended December 31, 2016. The preparation of this report would not have been possible
without the efficient and dedicated services of the personnel of the City of Lake Elmo. Further,
we would like to express our appreciation to all members of the organization who assisted in
contributing to the preparation of the report. Credit must also be given to the Mayor and the City
Council for their unfailing support for maintaining the highest standards of management of the
City of Lake Elmo’s finances.
Respectfully submitted,
Kristina Handt Brian A. Swanson
City Administrator Finance Director
v
vi
POSITION NAME TERM EXPIRES
ELECTED OFFICIALS
City Council:
Mayor Mike Pearson December 31, 2016
Council Member Justin Bloyer December 31, 2016
Council Member Julie Fliflet December 31, 2018
Council Member Jill Lundgren December 31, 2018
Council Member Anne Smith December 31, 2016
APPOINTED OFFICIALS
City Administrator Kristina Handt Continuous
Finance Director Cathy Bendel Continuous
City Clerk Julie Johnson Continuous
FINANCE COMMITTEE
Julie Fliflet, Committee Chair and City Council
Anne Smith, City Council
Terry Forrest, Retired CFO
CITY OF LAKE ELMO, MINNESOTA
ELECTED AND APPOINTED OFFICIALS
December 31, 2016
vii
This Page Left Blank Intentionally
CITY OF LAKE ELMO, MINNESOTA
FINANCIAL SECTION
DECEMBER 31, 2016
This Page Left Blank Intentional
INDEPENDENT AUDITOR'S REPORT
Honorable Mayor and Members of the City Council
City of Lake Elmo, Minnesota
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business-type
activities, each major fund and the aggregate remaining fund information of the City of Lake Elmo,
Minnesota, as of and for the year ended December 31, 2016, and the related notes to the financial
statements, which collectively comprise the City's basic financial statements as listed in the table of
contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes the
design, implementation and maintenance of internal control relevant to the preparation and fair presentation
of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted
our audit in accordance with auditing standards generally accepted in the United States of America. Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement.
An audit includes performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor's judgment, including the assessment
of the risks of material misstatement of the financial statements, whether due to fraud or error. In making
those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair
presentation of the financial statements in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal
control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness
of accounting principles used and the reasonableness of significant accounting estimates made by
management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business-type activities, each major fund
and the aggregate remaining fund information of the City of Lake Elmo, Minnesota, as of December 31,
2016, and the respective changes in financial position and, where applicable, cash flows thereof and the
budgetary comparison for the General Fund for the year then ended in accordance with accounting
principles generally accepted in the United States of America.
Honorable Mayor and Members of the City Council
City of Lake Elmo, Minnesota
Page 2
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management's
Discussion and Analysis on pages 3 through 13 and the required supplemental information as listed in the
Table of Contents be presented to supplement the basic financial statements. Such information, although
not a part of the basic financial statements, is required by the Governmental Accounting Standards Board,
who considers it to be an essential part of financial reporting for placing the basic financial statements in
appropriate operational, economic or historical context. We have applied certain limited procedures to the
required supplementary information in accordance with auditing standards generally accepted in the United
States of America, which consisted of inquiries of management about the methods of preparing the
information and comparing the information for consistency with management's responses to our inquiries,
the basic financial statements and other knowledge we obtained during our audit of the basic financial
statements. We do not express an opinion or provide any assurance on the information because the limited
procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the City of Lake Elmo, Minnesota's basic financial statements. The introductory section,
combining and individual nonmajor fund financial statements and statistical section listed in the Table of
Contents are presented for purposes of additional analysis and are not a required part of the basic financial
statements.
The combining and individual nonmajor fund financial statements and schedules are the responsibility of
management and were derived from and relate directly to the underlying accounting and other records used
to prepare the basic financial statements. Such information has been subjected to the auditing procedures
applied in the audit of the basic financial statements and certain additional procedures, including comparing
and reconciling such information directly to the underlying accounting and other records used to prepare
the basic financial statements or to the basic financial statements themselves, and other additional
procedures in accordance with auditing standards generally accepted in the United States of America. In
our opinion, the information is fairly stated, in all material respects, in relation to the basic financial
statements as a whole.
The introductory and statistical sections have not been subjected to the auditing procedures applied in the
audit of the basic financial statements and, accordingly, we do not express an opinion or provide any
assurance on them.
Minneapolis, Minnesota
June 29, 2017
CITY OF LAKE ELMO, MINNESOTA
MANAGEMENT’S DISCUSSION AND ANALYSIS
3
As management of the City of Lake Elmo, Minnesota, we offer readers of the City's financial statements
this narrative overview and analysis of the financial activities of the City of Lake Elmo, Minnesota for
the fiscal year ended December 31, 2016.
FINANCIAL HIGHLIGHTS
The assets of the City of Lake Elmo, Minnesota exceeded its liabilities at the close of the most
recent fiscal year by $38,252,973 (net position). Of this amount, $10,536,667 (unrestricted net
position) may be used to meet the City's ongoing obligations to citizens and creditors in
accordance with the City's fund designations and fiscal policies.
The City's total net position increased by $6,517,098 during 2016.
As of the close of the current fiscal year, the City of Lake Elmo, Minnesota’s governmental
funds reported combined ending fund balances of $8,223,754, an increase of $1,217,847 from
the prior year. This increase was due primarily to licenses and permit revenue related to
construction within the City.
At the end of the current fiscal year, unassigned fund balance for the general fund was
$3,279,815, or 89% of total general fund expenditures. The nonspendable portion of the
general fund balance as of December 31, 2016 ($409,222) related to the interfund loan to the
Village Project fund and prepaid items. The committed portion of the general fund balance as
of December 31, 2016 ($200,000) was a reserve for future insurance and legal fees.
The City's total noncurrent liabilities increased by $9,033,112 or 38% during the current fiscal
year due to the issuance of the 2016A General Obligation bonds.
The City was recognized by the Government Finance Officers Association of the United States
and Canada (GFOA) for obtaining a Certificate of Achievement for Excellence in Financial
Reporting for the City's 2015 Comprehensive Annual Financial Report.
OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis are intended to serve as an introduction to the City of Lake Elmo,
Minnesota’s basic financial statements. The City's basic financial statements are comprised of the
following three components: 1) government-wide financial statements, providing information for the
City as a whole, 2) fund financial statements, providing detailed information for the City's significant
funds, and 3) notes to the financial statements, providing additional information that is essential to
understanding the government-wide and fund statements. This report also contains other
supplementary information in addition to the basic financial statements themselves.
CITY OF LAKE ELMO, MINNESOTA
MANAGEMENT’S DISCUSSION AND ANALYSIS
4
Government-wide financial statements. The government-wide financial statements are designed
to provide readers with a broad overview of the City of Lake Elmo, Minnesota’s finances, in a manner
similar to a private-sector business.
The statement of net position presents information on all of the City of Lake Elmo, Minnesota’s assets
and liabilities, with the difference between the two reported as net position. Over time, increases or
decreases in net position may serve as a useful indicator of whether the financial position of the City
of Lake Elmo, Minnesota is improving or deteriorating.
The statement of activities presents information showing how the City's net position changed during
the most recent fiscal year. All changes in net position are reported as soon as the underlying event
giving rise to the change occurs, regardless of the timing of the related cash flows. Thus, revenues
and expenses are reported in this statement for some items that will only result in cash flows in future
fiscal periods (e.g. uncollected taxes and earned but unused vacation leave).
Both of the government-wide financial statements distinguish functions of the City of Lake Elmo,
Minnesota that are principally supported by taxes and intergovernmental revenues (governmental
activities) from other functions that are intended to recover all or a significant portion of their costs
through user fees and charges (business-type activities). The governmental activities of the City of
Lake Elmo, Minnesota include general government, public safety, public works, and culture and
recreation. The business-type activities of the City of Lake Elmo, Minnesota include the water, sewer
and storm sewer funds.
The government-wide financial statements can be found on pages 14-16 of this report.
Fund financial statements. A fund is a grouping of related accounts that is used to maintain control
over resources that have been segregated for specific activities or objectives. The City of Lake Elmo,
Minnesota, like other state and local governments, uses fund accounting to ensure and demonstrate
compliance with finance-related legal requirements. All of the funds of the City of Lake Elmo,
Minnesota can be divided into three categories: governmental funds, proprietary funds and fiduciary
funds.
Governmental funds. Governmental funds are used to account for essentially the same functions
reported as governmental activities in the government-wide financial statements. However, unlike the
government-wide financial statements, governmental fund financial statements focus on near-term
inflows and outflows of spendable resources, as well as on balances of spendable resources available
at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term
financial requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial
statements, it is useful to compare the information presented for governmental funds with similar
information presented for governmental activities in the government-wide financial statements. By
doing so, readers may better understand the long-term impact of the government’s near-term
financing decisions. Both the governmental fund balance sheet and the governmental fund statement
of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this
comparison between governmental funds and governmental activities.
CITY OF LAKE ELMO, MINNESOTA
MANAGEMENT’S DISCUSSION AND ANALYSIS
5
The City of Lake Elmo, Minnesota maintains twenty-two individual governmental funds, twelve of
which are debt service funds. Information is presented separately in the governmental fund balance
sheet and in the governmental fund statement of revenues, expenditures, and changes in fund
balances for the general fund, the debt service fund, the infrastructure reserve fund and the vehicle
acquisition fund, all of which are considered to be major funds. Data from the other governmental
funds are combined into a single, aggregated presentation. Individual fund data for each of these
nonmajor governmental funds is provided in the form of combining statements or schedules
elsewhere in this report.
The City of Lake Elmo, Minnesota adopts an annual budget for its general fund. Budgetary
comparison statements have been provided for this fund (pages 23 to 26) to demonstrate compliance
with the budget.
The basic governmental fund financial statements can be found on pages 17-22 of this report.
Proprietary funds. There are two different types of proprietary funds - enterprise funds and internal
service funds. Enterprise funds are used to report the same functions presented as business-type
activities in the government-wide financial statements. The City of Lake Elmo, Minnesota uses three
enterprise funds to account for its water, sewer and storm sewer operations. Internal service funds
are an accounting device used to accumulate and allocate costs internally among the City of Lake
Elmo, Minnesota's various functions. The City of Lake Elmo, Minnesota uses three internal service
funds to account for certain capital acquisition activities. Because all of these services predominantly
benefit governmental rather than business-type functions, they have been included within
governmental activities in the government-wide financial statements.
Proprietary funds provide the same type of information as the government-wide financial statements,
only in more detail. The proprietary fund financial statements provide separate information for the
water, sewer and storm sewer funds, all of which are considered to be major funds of the City of Lake
Elmo, Minnesota.
The proprietary fund financial statements can be found on pages 27-34 of this report.
Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties
outside the City. Fiduciary funds are not reflected in the government-wide financial statements
because the resources of those funds are not available to support the City's own programs. The
accounting use for fiduciary funds is much like that used for proprietary funds.
The basic fiduciary fund financial statement can be found on page 35 of this report.
Notes to the financial statements. The notes provide additional information that is essential to a
full understanding of the data provided in the government-wide and fund financial statements. The
notes to the financial statements can be found on pages 36-83 of this report.
Other Information. The combining schedules referred to earlier in connection with non-major
governmental funds, debt service funds, internal service funds and the fiduciary fund can be found
on pages 88-105 of this report.
CITY OF LAKE ELMO, MINNESOTA
MANAGEMENT’S DISCUSSION AND ANALYSIS
6
GOVERNMENT-WIDE FINANCIAL ANALYSIS
As noted earlier, net position may serve over time as a useful indicator of a government’s financial
position. In the case of the City of Lake Elmo, Minnesota, assets exceeded liabilities by $38,252,973
at the close of the most recent fiscal year.
The largest portion of the City of Lake Elmo, Minnesota’s net position, $21,539,009 (56%) reflects its
investment in capital assets (e.g. land, buildings and improvements, and machinery and equipment),
less any related debt used to acquire those assets that is still outstanding. The City of Lake Elmo,
Minnesota uses these capital assets to provide services to citizens; consequently, these assets are
not available for future spending. Although the City of Lake Elmo, Minnesota's investment in capital
assets is reported net of related debt, it should be noted that the resources needed to repay this debt
must be provided from other sources, since the capital assets themselves cannot be used to liquidate
these liabilities.
2016 2015 2016 2015 2016 2015
Current and other assets 10,893,806$ 9,687,510$ 10,098,093$ 6,221,558$ 20,991,899$ 15,909,068$
Capital assets 20,755,034 18,527,639 30,240,029 22,792,835 50,995,063 41,320,474
Total assets 31,648,840 28,215,149 40,338,122 29,014,393 71,986,962 57,229,542
Deferred outflows of resources 856,676 171,032 128,684 67,075 985,360 238,107
Long-term liabilities outstanding 13,471,388 10,889,186 19,244,126 12,793,216 32,715,514 23,682,402
Other liabilities 955,137 1,265,752 812,316 645,372 1,767,453 1,911,124
Total liabilities 14,426,525 12,154,938 20,056,442 13,438,588 34,482,967 25,593,526
Deferred inflows of resources 206,031 119,126 30,351 19,125 236,382 138,251
Net position:
Net investment in capital assets 9,032,535 8,723,329 12,506,474 10,170,351 21,539,009 18,893,680
Restricted 4,704,133 3,446,142 1,473,164 1,876,119 6,177,297 5,322,261
Unrestricted 4,136,292 3,942,646 6,400,375 3,577,285 10,536,667 7,519,931
Total net position 17,872,960$ 16,112,117$ 20,380,013$ 15,623,755$ 38,252,973$ 31,735,872$
City of Lake Elmo, Minnesota's Net Position
Governmental Activities Business-Type Activities Total
An additional portion of the City of Lake Elmo, Minnesota's net position (16%) represents resources
that are subject to external restrictions on how they may be used. The remaining balance of
unrestricted net position ($10,536,667) may be used to meet the government's ongoing obligations
to citizens and creditors.
At the end of the current fiscal year, the City of Lake Elmo, Minnesota is able to report positive
balances in all categories of net position for the City as a whole.
CITY OF LAKE ELMO, MINNESOTA
MANAGEMENT’S DISCUSSION AND ANALYSIS
7
Governmental activities. Governmental activities increased the City of Lake Elmo, Minnesota's net
position by $1,760,840 during 2016. Key elements of this increase include:
Charges for services increased by $864,288 from the prior year due primarily to an increase
in the amount of building permits issued by the City.
Special assessments revenue for 2015 projects increase by $239,804.
Business-type activities. Business-type activities increased the City of Lake Elmo, Minnesota's net
position by $4,756,258. This increase is due primarily to a construction grant received from the State
of Minnesota.
A condensed version of the Statement of Activities follows:
2016 2015 2016 2015 2016 2015
Revenues:
Program revenues:
Charges for services 1,803,531$ 939,243$ 3,330,409$ 3,602,559$ 5,133,940$ 4,541,802$
Operating grants and contributions 235,214 249,094 235,214 249,094
Capital grants and contributions 1,452,469 2,038,940 3,464,567 4,917,036 2,038,940
General revenues:
Property taxes 3,226,739 3,204,119 3,226,739 3,204,119
Other 104,291 123,076 45,171 39,757 149,462 162,833
Total revenues 6,822,244 6,554,472 6,840,147 3,642,316 13,662,391 10,196,788
Expenses:
General government 1,358,370 1,134,132 1,358,370 1,134,132
Public safety 1,308,360 1,344,282 1,308,360 1,344,282
Public works 1,698,566 1,377,969 1,698,566 1,377,969
Culture and recreation 660,947 639,006 660,947 639,006
Interest on long-term debt 178,266 215,611 178,266 215,611
Water 1,409,832 1,363,043 1,409,832 1,363,043
Sewer 380,650 250,866 380,650 250,866
Storm sewer 150,302 103,536 150,302 103,536
Total expenses 5,204,509 4,711,000 1,940,784 1,717,445 7,145,293 6,428,445
Increase in net position before transfers 1,617,735 1,843,472 4,899,363 1,924,871 6,517,098 3,768,343
Transfers 143,105 220,842 (143,105) (220,842)
Change in net position 1,760,840 2,064,314 4,756,258 1,704,029 6,517,098 3,768,343
Net position - beginning of year 16,112,120 14,047,803 15,623,755 13,919,726 31,735,875 27,967,529
Net position - end of year 17,872,960$ 16,112,117$ 20,380,013$ 15,623,755$ 38,252,973$ 31,735,872$
City of Lake Elmo, Minnesota's Change in Net Position
Governmental Activities Business-Type Activities Total
CITY OF LAKE ELMO, MINNESOTA
MANAGEMENT’S DISCUSSION AND ANALYSIS
8
Below are specific graphs that provide comparisons of the governmental activities direct program
revenues with their expenditures. Any shortfalls in direct revenues are primarily supported by property
tax levy or general state aid.
$0
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
$1,800,000
$2,000,000
Expenses and Program Revenues - Governmental Activities
Program revenues
Expenses
Property taxes
47%
Charges for
services
26%
Capital grants and
contributions
21%
Operating grants
and contributions
4%Other
2%
Revenues by Source - Governmental Activities
CITY OF LAKE ELMO, MINNESOTA
MANAGEMENT’S DISCUSSION AND ANALYSIS
9
The following graphs related the business-type activity's program revenues with its expenditures.
Since this activity requires significant physical assets to operate, any excess revenues are held for
planned capital expenditures to keep pace with growing demand for services.
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
Expenses and Program Revenues - Business-Type Activities
Program revenues
Expenses
Charges for
services
49%Capital grants and
contributions
51%
Other
less than 1%
Revenues by Source - Governmental Activities
CITY OF LAKE ELMO, MINNESOTA
MANAGEMENT’S DISCUSSION AND ANALYSIS
10
Financial Analysis of the Government's Funds
As noted earlier, the City of Lake Elmo, Minnesota uses fund accounting to ensure and demonstrate
compliance with finance-related legal requirements.
Governmental funds. The focus of the City of Lake Elmo, Minnesota’s governmental funds is to
provide information on near-term inflows, outflows, and balances of spendable resources. Such
information is useful in assessing the City of Lake Elmo, Minnesota’s financing requirements. In
particular, unassigned fund balance may serve as a useful measure of a government’s net resources
available for spending at the end of the fiscal year.
As of the end of the current fiscal year, the City of Lake Elmo, Minnesota’s governmental funds
reported combined ending fund balances of $8,223,754, an increase of $1,217,847 in comparison
with the prior year. Approximately $4,366,302 of this total fund balance, or 53%, constitutes assigned
and unassigned fund balance, which is available for spending at the government’s discretion. The
remainder of the fund balance ($3,857,452) is restricted, committed and nonspendable to indicate
that it is not available for new spending because it has already been restricted by creditors, grantors
or regulations of other governments, has been committed to a specific purpose by the City Council,
has been expensed for prepaid items, or is unavailable because the funds have been loaned to
another fund.
The general fund is the chief operating fund of City of Lake Elmo, Minnesota. At the end of the current
fiscal year, unassigned fund balance of the general fund was $3,279,815. As a measure of the general
fund's liquidity, it may be useful to compare the unassigned fund balance to total fund expenditures.
Unassigned fund balance represented 89% of total 2016 general fund expenditures. The general
fund’s total fund balance increased by $701,755 during the current fiscal year due primarily to an
increase in building permits and related revenue during the year.
The debt service fund increased its fund balance by $761,605 due to property taxes, special
assessments and intergovernmental revenues allocated to this fund in excess of debt service
expenditures.
The infrastructure reserve fund decreased its fund balance by $210,621 due primarily to capital outlay
expenditures in excess of bond proceeds allocated to this fund.
The vehicle acquisition fund decreased its fund balance by $27,493 due primarily to capital outlay
expenditures in excess of revenue allocated to this fund. This fund will no longer be used in 2017.
The special revenue funds decreased their overall fund balances by $60,414 due primarily to current
expenditures for culture and recreation in excess of property taxes allocated to those funds.
The capital projects funds, other than the infrastructure reserve fund and vehicle acquisition fund
described previously, increased their collective fund balance by $53,015 due primarily to park
dedication fees in excess of capital outlay expenditures in those funds.
Proprietary funds. The City of Lake Elmo, Minnesota's proprietary funds provide the same type of
information found in the government-wide financial statements, but in more detail.
CITY OF LAKE ELMO, MINNESOTA
MANAGEMENT’S DISCUSSION AND ANALYSIS
11
Unrestricted net position for water operations, sewer operations and storm sewer operations at the
end of the year amounted to $3,071,906, $2,406,958 and $921,511, respectively. The water fund,
sewer fund and storm sewer fund increased their net position by $3,809,117, $868,277 and $78,864,
respectively, for the year ended December 31, 2016. Other factors concerning the finances of these
three funds have already been addressed in the discussion of the City of Lake Elmo, Minnesota's
business-type activities.
General Fund Budgetary Highlights
The City's General Fund budget was not amended during the year. The budget called for no change
in the General Fund balance. The actual net change to the General Fund balance was an increase
of $701,755. Revenues were more than budget by $899,019 for the year ended December 31, 2016
due primarily to licenses and permits in excess of budget as result of increased building within the
City.
Total expenditures were more than budget by $197,264 for the year. One department had
expenditures in excess of budget: general government expenditures exceeded budget by $324,086.
The over expenditures in the general government department were primarily related to legal expenses
incurred over the amounts budgeted.
Capital Asset and Debt Administration
Capital assets. The City of Lake Elmo, Minnesota’s investment in capital assets for its governmental
and business-type activities as of December 31, 2016, amounted to $50,995,063 (net of accumulated
depreciation). This investment in capital assets includes land, buildings and improvements, and
machinery and equipment. Total capital assets increased by $9,674,589, or 23%, for the year ended
December 31, 2016, due primarily to completed construction projects and additional construction in
progress on various capital projects within the City.
2016 2015 2016 2015 2016 2015
Land 3,453,979$ 3,453,979$ 248,869$ 248,869$ 3,702,848$ 3,702,848$
Construction in progress 4,418,554 2,857,416 7,025,526 4,193,729 11,444,080 7,051,145
Buildings 2,576,941 2,649,349 2,576,941 2,649,349
Improvements other than buildings 438,996 439,669 438,996 439,669
Machinery and equipment 1,556,170 1,609,507 84,461 100,512 1,640,631 1,710,019
Infrastructure 8,310,394 7,517,719 22,881,173 18,249,725 31,191,567 25,767,444
Total 20,755,034$ 18,527,639$ 30,240,029$ 22,792,835$ 50,995,063$ 41,320,474$
TotalBusiness-Type ActivitiesGovernmental Activities
City of Lake Elmo, Minnesota's Capital Assets
(net of depreciation)
CITY OF LAKE ELMO, MINNESOTA
MANAGEMENT’S DISCUSSION AND ANALYSIS
12
Additional information on the City of Lake Elmo, Minnesota’s capital assets can be found in Note 3D
beginning on page 55 of this report.
Long-term debt. At the end of the current fiscal year, the City of Lake Elmo, Minnesota had
$30,400,000 in bonds, certificates and notes outstanding. The entire $30,400,000 outstanding
comprises debt backed by the full faith and credit of the government.
2016 2015 2016 2015 2016 2015
General obligation bonds 11,625,000$ 9,740,000$ 18,775,000$ 12,535,000$ 30,400,000$ 22,275,000$
General obligation certificates
General obligation notes payable 21,219 21,219
Total 11,625,000$ 9,761,219$ 18,775,000$ 12,535,000$ 30,400,000$ 22,296,219$
Governmental Activities Business-Type Activities Total
City of Lake Elmo, Minnesota's Outstanding Debt
General Obligation Bonds, Certificates and Notes
The City of Lake Elmo, Minnesota's total bonds and certificates payable increased by $8,103,781
during the current fiscal year. The increase was due primarily to the issuance of the 2016A General
Obligation bonds. A more detailed breakdown of these obligations can be found in Note 3E beginning
on page 57 of this report.
The City of Lake Elmo, Minnesota maintains an AA2 bond rating from Moody's Investor Service for
general obligation debt. The City has also recently been upgraded by Standard and Poor's to a AA+
bond rating.
State statutes limit the amount of general obligation debt a Minnesota City may issue to 3% of its
market value of taxable property. Net debt is payable solely from ad valorem taxes. The City is
currently well within this limit.
Economic Factors and Next Year's Budgets and Rates
The City planned a new minor collector road to be built (5th Street) in the I-94 Corridor
and many segments were completed in 2015 and 2016. A new minor collector road
(Village Parkway) in the Old Village has been planned out by the City with initial
sections having been built out in 2015 and 2016.
Plans continue with subsequent phases of the multi-phased developments which were
approved by the City.
The Cities taxable market value increased 13% from 2014 to 2015 and 8% from 2015
to 2016.
CITY OF LAKE ELMO, MINNESOTA
MANAGEMENT’S DISCUSSION AND ANALYSIS
13
Economic Factors and Next Year's Budgets and Rates (continued)
There was a slight reduction in the amount of total property taxes levied in 2017. This
was based on increases in charges for services revenues for building-related activities
and the planned use of fund balance, which helped to offset increases to the debt
service components of the tax levy.
Development continues to be strong in the new development areas. The 2017 budget
anticipates the building of 250 new homes and the continuation of commercial
expansion.
The Lake Elmo Avenue Downtown project with Washington County is well underway
and Phase I was completed in 2015. Phase II of the project was completed in 2016
and Phase III will be completed in 2017. The project covers full reconstruction of the
streets as well as upgrading the existing water system and installation of a new sewer
system and storm water drainage system.
The Inwood Avenue segment of the water line (for which the $3.5M in State Bonding
proceeds were secured) has moved into construction. This includes the construction
of a new water tower, booster station and the truck water main improvements
anticipated to be on-line in 2017.
Requests for Information
This financial report is designed to provide a general overview of the City of Lake Elmo, Minnesota’s
finances for all those with an interest in the City's finances. Questions concerning any of the
information provided in this report or requests for additional information should be addressed to City
of Lake Elmo, Minnesota, 3800 Laverne Avenue North, Lake Elmo, Minnesota, 55042.
This Page Left Blank Intentionally
CITY OF LAKE ELMO, MINNESOTA
FINANCIAL STATEMENTS
DECEMBER 31, 2016
This Page Left Blank Intentionally
See Notes to Financial Statements
14
Governmental Business-Type
Activities Activities Total
ASSETS
Cash and investments 8,879,954$ 4,686,929$ 13,566,883$
Receivables, net of allowance 1,584,601 1,899,537 3,484,138
Due from other governmental units 44,108 3,434,202 3,478,310
Internal balances (77,425) 77,425
Prepaid expenses 5,653 5,653
Net pension asset 456,915 456,915
Capital assets:
Nondepreciable 7,872,531 7,274,395 15,146,926
Depreciable, net 12,882,503 22,965,634 35,848,137
Total Assets 31,648,840 40,338,122 71,986,962
DEFERRED OUTFLOWS OF RESOURCES
Unamortized deferred amount on refunding 25,070 46,474 71,544
Deferred outflows from pension activity 831,606 82,210 913,816
Total Deferred Outflows of Resources 856,676 128,684 985,360
LIABILITIES
Accounts payable 670,456 79,110 749,566
Accrued expenses 66,038 8,512 74,550
Accrued interest 124,170 184,114 308,284
Escrow deposits 75,000 75,000
Due to other governmental units 11,173 161,580 172,753
Unearned revenue 8,300 379,000 387,300
Noncurrent liabilities:
Due within one year 958,467 722,625 1,681,092
Due in more than one year 11,060,143 18,322,092 29,382,235
Net pension liability 1,452,778 199,409 1,652,187
Total Liabilities 14,426,525 20,056,442 34,482,967
DEFERRED INFLOWS OF RESOURCES
Deferred inflows from pension activity 206,031 30,351 236,382
NET POSITION
Net investment in capital assets 9,032,535 12,506,474 21,539,009
Restricted
Debt service 4,704,133 1,473,164 6,177,297
Unrestricted 4,136,292 6,400,375 10,536,667
Total Net Position 17,872,960$ 20,380,013$ 38,252,973$
CITY OF LAKE ELMO, MINNESOTA
STATEMENT OF NET POSITION
December 31, 2016
15
Operating Capital
Charges for Grants and Grants and
Functions/Programs Expenses Services Contributions Contributions
Governmental activities:
General government 1,358,370$ 51,009$ $ $
Public safety 1,308,360 1,752,522 72,591
Public works 1,698,566 139,121 1,388,315
Culture and recreation 660,947 23,502 64,154
Interest on long-term debt 178,266
Total governmental activities 5,204,509 1,803,531 235,214 1,452,469
Business-Type activities:
Water 1,409,832 1,801,228 3,443,636
Sewer 380,650 1,315,948 20,931
Storm sewer 150,302 213,233
Total business-type activities 1,940,784 3,330,409 3,464,567
Total 7,145,293$ 5,133,940$ 235,214$ 4,917,036$
General revenues:
General property taxes
Grants and contributions not restricted to specific programs
Interest earnings
Miscellaneous
Transfers
Total general revenues and transfers
Change in net position
Net position - beginning
Net position - ending
Program Revenues
CITY OF LAKE ELMO, MINNESOTA
STATEMENT OF ACTIVITIES
For the Year Ended December 31, 2016
16
Governmental Business-Type
Activities Activities Total
(1,307,361)$ (1,307,361)$
516,753 516,753
(171,130) (171,130)
(573,291) (573,291)
(178,266) (178,266)
(1,713,295) (1,713,295)
3,835,032$ 3,835,032
956,229 956,229
62,931 62,931
4,854,192 4,854,192
(1,713,295) 4,854,192 3,140,897
3,226,739 3,226,739
8,584 748 9,332
43,228 44,423 87,651
52,479 52,479
143,105 (143,105)
3,474,135 (97,934) 3,376,201
1,760,840 4,756,258 6,517,098
16,112,120 15,623,755 31,735,875
17,872,960$ 20,380,013$ 38,252,973$
Net (Expense) Revenue
and Changes in Net Position
This Page Left Blank Intentionally
CITY OF LAKE ELMO, MINNESOTA
FUND FINANCIAL STATEMENTS
DECEMBER 31, 2016
See Notes to Financial Statements
17
CITY OF LAKE ELMO, MINNESOTA
BALANCE SHEET
GOVERNMENTAL FUNDS
December 31, 2016
General Fund
(101)
Debt Service
(300s)
Infrastructure
Reserve (409)
ASSETS
Cash and investments 3,727,367$ 3,326,884$ 143,963$
Receivables (Net of allowance for
uncollectibles)
Accounts 2,168 65,511
Delinquent taxes 44,088
Special assessments 1,189,170 266,733
Accrued interest 16,931
Due from other funds 200,937
Advances to other funds 405,398
Due from other governmental units 39,274 4,834
Prepaid items 3,824
TOTAL ASSETS 4,439,987$ 4,520,888$ 476,207$
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCE
LIABILITIES
Accounts payable 438,008$ $ 172,571$
Escrow deposits payable
Accrued liabilities 60,554
Due to other funds 95,605 7,032
Unearned revenue 8,300
Advances from other funds
Total liabilities 506,862 95,605 179,603
DEFERRED INFLOWS OF RESOURCES
Unavailable revenue:
Property taxes 44,088
Special assessments 1,189,170 266,733
Total deferred inflows of resources 44,088 1,189,170 266,733
FUND BALANCE
Nonspendable 409,222
Restricted 3,248,230
Committed 200,000
Assigned 29,871
Unassigned 3,279,815 (12,117)
Total Fund Balance 3,889,037 3,236,113 29,871
TOTAL LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCE 4,439,987$ 4,520,888$ 476,207$
18
Vehicle
Acquisition
(410)
Other
Governmental
Funds Total
39,191$ 1,642,549$ 8,879,954$
67,679
44,088
1,455,903
16,931
200,937
405,398
44,108
3,824
39,191$ 1,642,549$ 11,118,822$
$ 71,225$ 681,804$
75,000 75,000
3,480 64,034
57,904 160,541
8,300
405,398 405,398
613,007 1,395,077
44,088
1,455,903
1,499,991
409,222
3,248,230
200,000
39,191 1,435,594 1,504,656
(406,052) 2,861,646
39,191 1,029,542 8,223,754
39,191$ 1,642,549$ 11,118,822$
This Page Left Blank Intentionally
See Notes to Financial Statements
19
Amounts reported for governmental activities in the statement of net position are different because:
Total governmental fund balances (pages 17-18) 8,223,754$
Capital assets used in governmental activities are not financial
resources and, therefore, are not reported in the funds:
Governmental funds - capital assets 27,619,139$
Accumulated depreciation (7,036,476)
20,582,663
Other long-term assets are not available to pay for current-period
expenditures and, therefore, are unavailable in the funds:
Delinquent property taxes 44,088$
Special assessments 1,455,903
1,499,991
Long-term liabilities are not due and payable in the current period
and therefore are not reported in the funds:
Bonds and notes payable (11,625,000)$
Net pension liability (asset), deferred outflows and
inflows from pension activity (370,288)
Compensated absences (64,623)
Post employment benefit obligation (206,419)
Accrued interest (124,170)
Unamortized deferred amount on refunding 25,070
Unamortized bond premiums (181,792)
Unamortized bond discounts 59,224
(12,487,998)
Internal service funds are used by management to charge the cost
of services to individual funds. The assets and liabilities are
included in the governmental statement of net position. 54,550
Net position of governmental activities (page 14) 17,872,960$
December 31, 2016
CITY OF LAKE ELMO, MINNESOTA
RECONCILIATION OF NET POSITION IN THE
GOVERNMENT-WIDE FINANCIAL STATEMENTS AND FUND BALANCES
IN THE FUND BASIS FINANCIAL STATEMENTS
20
CITY OF LAKE ELMO, MINNESOTA
STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
For the Year Ended December 31, 2016
General Fund
(101)
Debt Service
(300s)
Infrastructure
Reserve (409)
REVENUES
Taxes 2,310,177$ 664,540$ $
Licenses and permits 1,713,918
Intergovernmental 209,373 72,100 1,401
Charges for services 38,608
Fines and forfeitures 49,505
Special assessments 897,323
Dedication fees
Refunds and reimbursements
Investment earnings 20,437 15,309
Miscellaneous revenue 42,515
TOTAL REVENUES 4,384,533 1,649,272 1,401
EXPENDITURES
Current
General government 1,280,259
Public safety 1,262,040
Public works 893,644
Culture and recreation 168,788
Unallocated 78,047
Capital Outlay
Public safety
Public works 2,974,274
Culture and recreation
Debt Service
Principal 805,000
Interest and other charges 225,772
Bond issuance costs 16,233
TOTAL EXPENDITURES 3,682,778 1,030,772 2,990,507
Excess (deficiency) of revenues
over (under) expenditures 701,755 618,500 (2,989,106)
OTHER FINANCING SOURCES (USES)
Issuance of debt 2,690,000
Premium on issuance of debt 102,877
(Discount) on issuance of debt (14,392)
Transfers 143,105
TOTAL OTHER FINANCING SOURCES (USES) 143,105 2,778,485
Net change in fund balances 701,755 761,605 (210,621)
FUND BALANCES, Beginning 3,187,282 2,474,508 240,492
FUND BALANCES, Ending 3,889,037$ 3,236,113$ 29,871$
21
Vehicle
Acquisition
(410)
Other
Governmental
Funds Total
$ 256,957$ 3,231,674$
1,713,918
282,874
38,608
49,505
897,323
171,708 171,708
21,390 21,390
180 7,302 43,228
13,586 56,101
180 470,943 6,506,329
1,280,259
1,262,040
893,644
331,901 500,689
78,047
6,067 6,067
2,974,274
146,441 146,441
21,219 826,219
387 226,159
16,233
27,673 478,342 8,210,072
(27,493) (7,399) (1,703,743)
2,690,000
102,877
(14,392)
143,105
2,921,590
(27,493) (7,399) 1,217,847
66,684 1,036,941 7,005,907
39,191$ 1,029,542$ 8,223,754$
This Page Left Blank Intentionally
See Notes to Financial Statements
22
Amounts reported for governmental activities in the statement of activities are different because:
Net change in fund balances - total governmental funds (pages 20-21) 1,217,847$
Governmental funds report capital outlay as expenditures.
However, in the statement of activities the cost of those assets
is allocated over their estimated useful lives and reported as
depreciation expense:
Capital outlay capitalized 3,100,540$
Depreciation expense (917,521)
2,183,019
Revenues in the statement of activities that do not provide current
financial resources are not reported as revenues in the funds:
Special assessments 487,491$
Property taxes 900
Intergovernmental revenue (70,000)
Park dedication fees (107,554)
310,837
Some expenses reported in the statement of activities do not require
the use of current financial resources and, therefore, are not
reported as expenditures in governmental funds:
Compensated absences, end of year (64,623)$
Compensated absences, beginning of year 70,161
Post employment benefit obligation, end of year (206,419)
Post employment benefit obligation, beginning of year 174,282
(26,599)
Bond, contract and loan proceeds provide current financial resources
to governmental funds, but issuing debt increase long-term
liabilities in the statement of net position. Repayment of long-term
debt is an expenditure in the governmental funds, but the
repayment reduces long-term liabilities in the statement of net
position:
Principal retirement on long-term debt 826,219$
Issuance of long-term debt (2,690,000)
Change in net pension liability (asset) 70,909
Change in deferred amount on refunding (2,539)
Change in accrued interest, bond premiums and
bond discounts (104,223)
(1,899,634)
Internal service funds are used by management to charge the costs of
capital equipment replacement to individual funds. The net revenue
of certain activities of internal service funds is reported with
governmental activities in the government-wide financial statements (24,630)
Change in net position of governmental activities (page 16) 1,760,840$
CITY OF LAKE ELMO, MINNESOTA
RECONCILIATION OF THE STATEMENT OF REVENUES,
EXPENDITURES, AND CHANGES IN FUND BALANCES OF
GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
For the Year Ended December 31, 2016
See Notes to Financial Statements
23
Variance with
2016 Final Budget-
Actual Positive
Original Final Amounts (Negative)
REVENUES
Taxes
Property 2,218,406$ 2,218,406$ 2,210,359$ (8,047)$
Franchise 49,000 49,000 99,818 50,818
Total Taxes 2,267,406 2,267,406 2,310,177 42,771
Licenses and Permits
Business 15,180 15,180 12,185 (2,995)
Nonbusiness 901,529 901,529 1,701,733 800,204
Total Licenses and Permits 916,709 916,709 1,713,918 797,209
Intergovernmental
MSA - maintenance 101,696 101,696 123,433 21,737
Fire state aid 41,500 41,500 59,136 17,636
Other 7,813 7,813 11,116 3,303
County and local 15,500 15,500 15,688 188
Total Intergovernmental 166,509 166,509 209,373 42,864
Charges for Services 30,890 30,890 38,608 7,718
Fines and Forfeits 45,000 45,000 49,505 4,505
Investment Earnings 55,000 55,000 20,437 (34,563)
Miscellaneous Revenue 4,000 4,000 42,515 38,515
TOTAL REVENUES 3,485,514$ 3,485,514$ 4,384,533$ 899,019$
Budgeted Amounts
CITY OF LAKE ELMO, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
For the Year Ended December 31, 2016
See Notes to Financial Statements
24
Variance with
2016 Final Budget-
Actual Positive
Original Final Amounts (Negative)
EXPENDITURES
General Government
Mayor and Council
Personnel services 27,956$ 27,956$ 27,656$ 300$
Other services and charges 18,000 18,000 28,257 (10,257)
Total Mayor and Council 45,956 45,956 55,913 (9,957)
Election
Other services and charges 15,800 15,800 9,092 6,708
Finance and Administration
Personnel services 304,906 304,906 361,223 (56,317)
Supplies 7,457 7,457 7,349 108
Other services and charges 60,040 60,040 84,590 (24,550)
Total Finance and Administration 372,403 372,403 453,162 (80,759)
Communications
Other services and charges 3,955 (3,955)
Total Communications 3,955 (3,955)
City Facilities
Supplies 350 350 4 346
Other services and charges 55,632 55,632 70,437 (14,805)
Total City Facilities 55,982 55,982 70,441 (14,459)
Professional Services
Assessor 38,000 38,000 52,049 (14,049)
Accounting and auditing 35,350 35,350 29,459 5,891
Legal 60,000 60,000 322,842 (262,842)
Engineering 48,000 48,000 34,229 13,771
Total Professional Services 181,350 181,350 438,579 (257,229)
Budgeted Amounts
CITY OF LAKE ELMO, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL (CONTINUED)
For the Year Ended December 31, 2016
See Notes to Financial Statements
25
Variance with
2016 Final Budget-
Actual Positive
Original Final Amounts (Negative)
EXPENDITURES
General Government
Planning and Zoning
Personnel services 198,282$ 198,282$ 201,367$ (3,085)$
Supplies 2,550 2,550 810 1,740
Other services and charges 83,850 83,850 46,940 36,910
Total Planning and Zoning 284,682 284,682 249,117 35,565
Total General Government 956,173 956,173 1,280,259 (324,086)
Public Safety
Police
Contracted services 527,060 527,060 536,330 (9,270)
Fire Protection
Personnel services 235,170 235,170 218,234 16,936
2% fire aid 37,323 37,323 59,136 (21,813)
Supplies 32,250 32,250 21,237 11,013
Other services and charges 109,812 109,812 132,336 (22,524)
Total Fire Protection 414,555 414,555 430,943 (16,388)
Building Inspector
Personnel services 228,341 228,341 217,829 10,512
Supplies 9,300 9,300 2,123 7,177
Other services and charges 23,125 23,125 15,080 8,045
Total Building Inspector 260,766 260,766 235,032 25,734
Animal Control
Other services and charges 7,550 7,550 10,646 (3,096)
Criminal Legal 54,700 54,700 44,144 10,556
Emergency Communications 7,400 7,400 4,945 2,455
Total Public Safety 1,272,031$ 1,272,031$ 1,262,040$ 9,991$
Budgeted Amounts
CITY OF LAKE ELMO, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL (CONTINUED)
For the Year Ended December 31, 2016
See Notes to Financial Statements
26
Variance with
2016 Final Budget-
Actual Positive
Original Final Amounts (Negative)
EXPENDITURES
Public Works
General
Personnel services 265,259$ 265,259$ 347,070$ (81,811)$
Supplies 525,950 525,950 367,657 158,293
Other services and charges 126,225 126,225 155,817 (29,592)
Total General 917,434 917,434 870,544 46,890
Trees 1,000 1,000 615 385
Street Lighting 26,400 26,400 22,485 3,915
Total Public Works 944,834 944,834 893,644 51,190
Culture and Recreation
Parks
Personnel services 192,420 192,420 136,617 55,803
Supplies 10,000 10,000 9,884 116
Other services and charges 28,900 28,900 22,287 6,613
Total Culture and Recreation 231,320 231,320 168,788 62,532
Other Unallocated
Compensation adjustments 20,000 20,000 20,000
IT and telephone expense 61,156 61,156 78,047 (16,891)
Total Other Unallocated 81,156 81,156 78,047 3,109
Total Expenditures 3,485,514 3,485,514 3,682,778 (197,264)
Excess (deficiency) of revenues
over (under) expenditures 701,755 701,755
OTHER FINANCING SOURCES (USES)
Transfers
NET CHANGE IN FUND BALANCE 701,755 701,755
FUND BALANCE, January 1 3,187,282 3,187,282 3,187,282
FUND BALANCE, December 31 3,187,282$ 3,187,282$ 3,889,037$ 701,755$
Budgeted Amounts
CITY OF LAKE ELMO, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL (CONTINUED)
For the Year Ended December 31, 2016
See Notes to Financial Statements
27
CITY OF LAKE ELMO, MINNESOTA
PROPRIETARY FUNDS
Combining Statement of Net Position
December 31, 2016
Water (601) Sewer (602)
Storm Sewer
(603)
ASSETS
Current Assets
Cash and investments 135,048$ 2,606,515$ 1,945,366$
Receivables
Accounts 130,481 40,774 221,693
Special assessments 360,690 1,131,468 14,431
Due from other governments 3,432,485 1,466 251
Due from other funds 54,305 23,915
Total Current Assets 4,058,704 3,834,528 2,205,656
Noncurrent Assets
Property and Equipment
Land 248,869
Machinery and equipment 300,587
Infrastructure 20,536,904 6,404,080 611,337
Construction in progress 4,861,511 550,564 1,613,451
Total Property and Equipment 25,947,871 6,954,644 2,224,788
Less: Accumulated depreciation 4,387,149 381,713 118,412
Net Property and Equipment 21,560,722 6,572,931 2,106,376
Total Assets 25,619,426 10,407,459 4,312,032
DEFERRED OUTFLOWS OF RESOURCES
Deferred charges on refunding 46,474
Deferred outflows from pension activity 55,931 16,581 9,698
Total Deferred Outflows of Resources 102,405$ 16,581$ 9,698$
Business-Type Activities - Enterprise Funds
28
Governmental
Activities -
Total
Internal
Service Funds
4,686,929$ $
392,948
1,506,589
3,434,202
78,220
10,098,888
248,869
300,587 654,692
27,552,321
7,025,526
35,127,303 654,692
4,887,274 482,321
30,240,029 172,371
40,338,917 172,371
46,474
82,210
128,684$ $
See Notes to Financial Statements
29
CITY OF LAKE ELMO, MINNESOTA
PROPRIETARY FUNDS
Combining Statement of Net Position (Continued)
December 31, 2016
Water (601) Sewer (602)
Storm Sewer
(603)
LIABILITIES
Current Liabilities
Accounts payable 35,640$ 41,664$ 1,806$
Accrued salaries payable 5,816 1,834 862
Accrued interest payable 96,963 57,604 29,547
Due to other funds 795
Due to other governments 7,511 145,493 8,576
Unearned revenue 379,000
Current portion of compensated absences 8,844 6,604 2,177
Current portion of bonds payable 485,000 220,000
Total Current Liabilities 1,019,569 473,199 42,968
Long-term Liabilities
Other postemployment benefits payable 17,499 5,405 7,918
Compensated absences payable 2,948 2,201 726
Net pension liability 126,574 45,108 27,727
Bonds payable and unamortized premium on
bonds, net of unamortized discount on bonds 11,141,149 4,320,429 2,823,817
Total Long-term Liabilities 11,288,170 4,373,143 2,860,188
Total Liabilities 12,307,739 4,846,342 2,903,156
DEFERRED INFLOWS OF RESOURCES
Deferred inflows from pension activity 19,443 6,770 4,138
NET POSITION
Net investment in capital assets 9,981,047 2,032,502 492,925
Restricted
Debt service 341,696 1,131,468
Unrestricted 3,071,906 2,406,958 921,511
Total Net Position 13,394,649$ 5,570,928$ 1,414,436$
Business-Type Activities - Enterprise Funds
30
Governmental
Activities -
Total
Internal
Service Funds
79,110$ $
8,512
184,114
795 117,821
161,580
379,000
17,625
705,000
1,535,736 117,821
30,822
5,875
199,409
18,285,395
18,521,501
20,057,237 117,821
30,351
12,506,474 172,371
1,473,164
6,400,375 (117,821)
20,380,013$ 54,550$
See Notes to Financial Statements
31
CITY OF LAKE ELMO, MINNESOTA
PROPRIETARY FUNDS
Combining Statement of Revenues, Expenses
and Changes in Net Position
For the Year Ended December 31, 2016
Business-Type Activities - Enterprise Funds
Water (601) Sewer (602)
Storm Sewer
(603)
Operating Revenues 1,504,202$ 932,448$ 213,233$
Operating Expenses
Personnel services 184,129 55,740 30,248
Supplies 140,861 8,730 6,272
Professional services 15,442 13,311 31,111
Repairs and maintenance 10,800 27,428 21,944
Insurance 8,975
Utilities 180,117 22,754
Depreciation 612,352 132,265 15,962
Total Operating Expenses 1,152,676 260,228 105,537
Operating Income (Loss)351,526 672,220 107,696
Other Revenue (Expense)
Investment earnings 13,987 14,584 15,852
Rents 52,526
Future infrastructure charges 244,500 383,500
Bond issuance costs (19,465) (5,191) (16,718)
Intergovernmental revenue 525 142 81
Interest and fiscal expense (237,691) (115,231) (28,047)
Total Other Revenue (Expense) 54,382 277,804 (28,832)
Income (Loss) Before Transfers
and Contributions 405,908 950,024 78,864
Capital contributions 3,443,636 20,931
Transfers out (40,427) (102,678)
Change in net position 3,809,117 868,277 78,864
Net Position, Beginning 9,585,532 4,702,651 1,335,572
Net Position, End of Year 13,394,649$ 5,570,928$ 1,414,436$
See Notes to Financial Statements
32
Governmental
Activities -
Total
Internal
Service Funds
2,649,883$ $
270,117
155,863
59,864
60,172
8,975
202,871
760,579 24,630
1,518,441 24,630
1,131,442 (24,630)
44,423
52,526
628,000
(41,374)
748
(380,969)
303,354
1,434,796 (24,630)
3,464,567
(143,105)
4,756,258 (24,630)
15,623,755 79,180
20,380,013$ 54,550$
33
Governmental
Activities -
Water (601) Sewer (602)
Storm Sewer
(603) Total
Internal Service
Funds
Cash Flows from Operating Activities
Cash received from customers 2,191,512$ 1,570,518$ 235,763$ 3,997,793$ $
Cash payments to suppliers (558,431) 1,904 (56,666) (613,193)
Cash payments to employees (164,894) (44,897) (26,303) (236,094)
Net Cash Provided By (Used In)
Operating Activities 1,468,187 1,527,525 152,794 3,148,506
Cash Flows From Investing Activities
Interest earnings received 13,987 14,584 15,852 44,423
Cash Flows from Noncapital Financing Activities
Rents received 52,526 52,526
Increase in due to other funds 41,740
Transfers to other funds (40,427) (102,678) (143,105)
Net Cash Provided By (Used In) Noncapital
Financing Activities 12,099 (102,678) (90,579) 41,740
Cash Flows from Capital and Related Financing Activities
Acquisition of capital assets (6,187,932) (538,590) (1,481,249) (8,207,771) (69,003)
Special assessments received 137,938 292,432 2,487 432,857
Proceeds from issuance of long-term debt 3,225,000 860,000 2,770,000 6,855,000
Bond issuance costs (19,465) (5,191) (16,718) (41,374)
Increase in unamortized bond premiums 58,434 15,660 55,315 129,409
Principal paid on long-term debt (415,000) (200,000) (615,000)
Interest paid on long-term debt (197,021) (107,425) (304,446)
Net Cash Provided By (Used In) Capital and
Related Financing Activities (3,398,046) 316,886 1,329,835 (1,751,325) (69,003)
Net Increase (Decrease) in Cash
and Cash Equivalents (1,903,773) 1,756,317 1,498,481 1,351,025 (27,263)
Cash and Cash Equivalents, January 1 2,038,821 850,198 446,885 3,335,904 27,263
Cash and Cash Equivalents, December 31 135,048$ 2,606,515$ 1,945,366$ 4,686,929$ $
Business-Type Activities - Enterprise Funds
CITY OF LAKE ELMO, MINNESOTA
PROPRIETARY FUNDS
Combining Statement of Cash Flows
For the Year Ended December 31, 2016
See Notes to Financial Statements
34
Governmental
Activities -
RECONCILIATION OF OPERATING INCOME TO NET
CASH PROVIDED BY OPERATING ACTIVITIES Water (601) Sewer (602)
Storm Sewer
(603) Total
Internal Service
Funds
Operating income (loss) 351,526$ 672,220$ 107,696$ 1,131,442$ (24,630)$
Adjustments to reconcile operating income to
net cash provided by operating activities
Depreciation 612,352 132,265 15,962 760,579 24,630
Change in net pension liability 6,821 1,847 1,050 9,718
Future infrastructure charges, included
in nonoperating revenue 244,500 383,500 628,000
(Increase) decrease in:
Accounts receivable 227,290 256,036 22,781 506,107
Due from other governments 520 (1,466) (251) (1,197)
Prepaid expenses 1,290 1,290
Increase (decrease) in:
Accounts payable (207,454) (61,701) (1,279) (270,434)
Accrued salaries payable 2,418 568 57 3,043
Due to other governments 5,218 134,538 3,940 143,696
Unearned revenue 215,000 215,000
Other postemployment benefits payable 3,494 1,520 1,112 6,126
Compensated absences payable 6,502 6,908 1,726 15,136
Net Cash Provided By (Used In) Operating Activities 1,468,187$ 1,527,525$ 152,794$ 3,148,506$ $
Noncash Capital and Related Financing Activities
Amortization of deferred charges 5,333$ 547$ 402$ 6,282$ $
Amortization of bond premiums 8,966 2,032 1,902 12,900
Receipt of contributed capital 11,334 20,931 32,265
Capital asset grant included in receivables 3,432,302 3,432,302
Business-Type Activities - Enterprise Funds
CITY OF LAKE ELMO, MINNESOTA
PROPRIETARY FUNDS
Combining Statement of Cash Flows (Continued)
For the Year Ended December 31, 2016
See Notes to Financial Statements
35
Agency Funds
ASSETS
Cash and investments 2,394,526$
Accounts receivable 128
TOTAL ASSETS 2,394,654$
LIABILITIES
Accounts payable 64,812$
Deposits payable 2,329,842
TOTAL LIABILITIES 2,394,654$
CITY OF LAKE ELMO, MINNESOTA
STATEMENT OF FIDUCIARY NET POSITION
FIDUCIARY FUNDS
December 31, 2016
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2016
This Page Left Blank Intentionally
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
36
1. Summary of Significant Accounting Policies
The financial statements of the City of Lake Elmo, Minnesota (the City) have been prepared in
conformity with generally accepted accounting principles (GAAP) as applied to governmental units.
The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for
establishing governmental accounting and financial reporting principles. The more significant of the
City's accounting principles are described below.
A. Reporting Entity
The City operates under Optional Plan A as defined in the State of Minnesota statutes. The
City is governed by an elected Mayor and a four-member Council. The Council exercises
legislative authority and determines all matters of policy. The Council appoints personnel
responsible for the proper administration of all affairs relating to the City. The City has
considered all potential component units for which it is financially accountable, and other
organizations for which the nature and significance of their relationship with the City are
such that exclusion would cause the City's financial statements to be misleading or
incomplete. GASB has set forth criteria to be considered in determining financial
accountability for a component unit. These criteria include appointing a voting majority of
the component unit's governing body, and 1) the ability of the primary government to impose
its will on that component unit, or 2) the potential for the component unit to provide specific
benefits to, or impose specific financial burdens on the primary government. The City has
no component units.
Related Organizations
The Lake Elmo Firemen's Relief Association (Association) is organized as a legally separate
entity from the City by its members to provide pension and other benefits to its members in
accordance with Minnesota statutes. The membership appoints the board of the
Association and separate financial statements are issued by the Association. All funding is
conducted in accordance with Minnesota statutes. Although the City levies property taxes
for the Association, the Association is fiscally independent to determine and levy taxes. The
City's portion of the pension benefit costs related to the Association is included in the general
fund. The Association does not have any significant operational or financial relationship
with the City.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
37
1. Summary of Significant Accounting Policies (Continued)
B. Government-wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net position and the
statement of activities) report information on all of the nonfiduciary activities of the City.
Governmental activities, which normally are supported by taxes and intergovernmental
revenues, are reported separately from business-type activities, which rely to a significant
extent on fees and charges for support.
The statement of activities demonstrates the degree to which the direct expenses of a
given function or segment is offset by program revenues. Direct expenses are those that
are clearly identifiable with a specific function or segment. Program revenues include 1)
charges to customers or applicants who purchase, use, or directly benefit from goods,
services, or privileges provided by a given function or segment and 2) grants and
contributions that are restricted to meeting the operational or capital requirements of a
particular function or segment. Taxes and other items not properly included among
program revenues are reported instead as general revenues.
Separate financial statements are provided for governmental funds, proprietary funds and
fiduciary funds, even though the latter are excluded from the government-wide financial
statements. Major individual governmental funds and major individual enterprise funds are
reported as separate columns in the fund financial statements.
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources
measurement focus and the accrual basis of accounting, as are the proprietary fund
financial statements. Revenues are recorded when earned and expenses are recorded
when a liability is incurred, regardless of the timing of related cash flows. Property taxes
are recognized as revenues in the year for which they are levied. Grants and similar items
are recognized as revenue as soon as all eligibility requirements imposed by the provider
have been met.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are
recognized as soon as they are both measurable and available. Revenues are considered
to be available when they are collectible within the current period or soon enough
thereafter to pay liabilities of the current period. For this purpose, the City considers
revenues to be available if they are collected within 60 days of the end of the current fiscal
period.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
38
1. Summary of Significant Accounting Policies (Continued)
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation
(Continued)
Expenditures generally are recorded when a liability is incurred, as under accrual
accounting. However, debt service expenditures, as well as expenditures related to
compensated absences and claims and judgments, are recorded when payment is due.
Property taxes, licenses and permits, and interest associated with the current fiscal period
are all considered to be susceptible to accrual and so have been recognized as revenues
of the current fiscal period. Only the portion of special assessments receivable due within
the current fiscal period is considered to be susceptible to accrual as revenue of the
current period. All other revenue items are considered to be measurable and available
only when cash is received by the City.
Revenue resulting from exchange transactions, in which each party gives and receives
essentially equal value, is recorded on the accrual basis when the exchange takes place.
On a modified accrual basis, revenue is recorded in the year in which the resources are
measureable and become available.
Non-exchange transactions, in which the City receives value without directly giving equal
value in return, include property taxes, grants and donations. On an accrual basis,
revenue from property taxes is recognized in the year for which the tax is levied. Revenue
from grants and donations is recognized in the year in which all eligibility requirements
have been satisfied. Eligibility requirements include timing requirements, which specify
the year in which the resources are required to be used or the year when use is first
permitted; matching requirements, in which the City must provide local resources to be
used for a specific purpose; and expenditure requirements, in which the resources are
provided to the City on a reimbursement basis. On a modified accrual basis, revenue from
non-exchange transactions must also be available before it is recognized.
Unearned revenue is recorded when assets are recognized before revenue recognition
criteria have been satisfied. Grants received before eligibility requirements other than time
requirements are met are recorded as unearned revenue. Grants received before time
requirements are met are recorded as a deferred inflow of resources.
The City reports the following major governmental funds:
The general fund is the government’s primary operating fund. It accounts for all
financial resources of the City, except those required to be accounted for in another
fund.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
39
1. Summary of Significant Accounting Policies (Continued)
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation
(Continued)
The debt service fund is an accumulation of resources (primarily special
assessments and property tax revenues) for the payments of principal and interest
on long-term general obligation debt of governmental funds.
The infrastructure reserve fund accounts for the accumulation of funds for the
current and future road and street infrastructure projects.
The vehicle acquisition fund accounts for the accumulation of funds for the
purchase of vehicles to be used by various City departments. Although this fund
did not meet the requirements to be considered a major fund, management has
elected to include this fund as a major fund as of and for the year ended December
31, 2016. This fund will be closed during 2017.
The City reports the following major proprietary funds:
The water fund accounts for the activities of the City's water distribution operations.
The sewer fund accounts for revenues and costs associated with the City's sewer
system.
The storm sewer fund accounts for costs associated with the City's storm sewer
system. These costs are financed by the storm sewer surcharge.
Additionally, the City reports the following fund types:
Internal service funds are used to account for the replacement of radios, information
technology and furniture, fixtures and equipment expenses of the governmental
activities. Internal service funds operate in a manner similar to enterprise funds;
however, they accumulate funding primarily from other departments within the City
on a cost reimbursement basis.
Fiduciary funds account for assets held by the City in a trustee capacity or as an
agent on behalf of others.
Agency funds are custodial in nature and do not present results of operations or
have a measurement focus. Agency funds are accounted for using the modified
accrual basis of accounting. These funds are used to account for assets that the
City holds for others in an agency capacity.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
40
1. Summary of Significant Accounting Policies (Continued)
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation
(Continued)
As a general rule the effect of interfund activity has been eliminated from the government-
wide financial statements. Exceptions to this general rule are payments-in-lieu of taxes
and other charges between the City's enterprise funds and various other functions of the
City. Elimination of these charges would distort the direct costs and program revenues
reported for the various functions concerned.
Amounts reported as program revenues include 1) charges to customers or applicants for
goods, services, or privileges provided, 2) operating grants and contributions, and 3)
capital grants and contributions, including special assessments. Internally dedicated
resources are reported as general revenues rather than as program revenues. Likewise,
general revenues include all taxes.
Proprietary funds distinguish operating revenues and expenses from nonoperating items.
Operating revenues and expenses generally result from providing services and producing
and delivering goods in connection with a proprietary fund's principal ongoing operations.
The principal operating revenues of the City's enterprise funds are charges to customers for
sales and services. Operating expenses for enterprise funds include the cost of sales and
services, administrative expenses, and depreciation of capital assets. All other revenues
and expenses are reported as nonoperating revenues and expenses.
When both restricted and unrestricted resources are available for use, it is the City's policy
to use restricted resources first, then unrestricted resources as they are needed.
D. Assets, Liabilities, Deferred Inflows of Resources and Net Position
1. Cash and investments (including cash equivalents)
Cash balances from all funds (including cash equivalents) are pooled and invested to
the extent available in various securities as authorized by Minnesota statutes. Earnings
from the pooled investments are allocated to the respective funds on the basis of
applicable cash balance (or due from other funds balance) participation by each fund.
Investments are stated at fair value, based upon quoted market prices at the reporting
date. Cash and cash equivalents for purposes of the basic financial statements includes
amounts in demand deposits as well as all investments held by the City.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
41
1. Summary of Significant Accounting Policies (Continued)
D. Assets, Liabilities, Deferred Inflows of Resources and Net Position (Continued)
2. Receivables and payables
Activity between funds that are representative of lending/borrowing arrangements
outstanding at the end of the fiscal year are referred to as either "due to/from other funds"
(i.e., the current portion of interfund loans) or "advances to/from other funds" (i.e., the
non-current portion of interfund loans). All other outstanding balances between funds
are reported as "due to/from other funds." Any residual balances outstanding between
the governmental activities and business-type activities are reported in the government-
wide financial statements as "interfund balances."
Advances between funds, if any, are offset by a fund balance reserve account in
applicable governmental funds to indicate that they are not available for appropriation
and are not expendable available financial resources.
Property tax levies are set by the City Council in December of each year and are certified
to Washington County for collection in the following year. In Minnesota, counties act as
collection agents for all property taxes. The County spreads all levies over taxable
property. Such taxes become a lien on January 1, of the following year, and are
recorded as receivables by the City at that date. Revenues from property taxes are
accrued and recognized in the year collectible, net of delinquencies.
Real property taxes may be paid by taxpayers in two equal installments on May 15 and
October 15. Personal property taxes may be paid on February 28 and June 30. The
County provides tax settlements to cities and other taxing districts normally during the
months of January, July and December.
Taxes which remain unpaid at December 31 are classified as delinquent taxes
receivable. The net amount of delinquent taxes receivable are fully offset by deferred
inflows of resources in the governmental funds of the fund financial statements because
they are not known to be available to finance current expenditures.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
42
1. Summary of Significant Accounting Policies (Continued)
D. Assets, Liabilities, Deferred Inflows of Resources and Net Position (Continued)
2. Receivables and payables (continued)
Assessments are levied at various times upon City Council resolution for property owner
improvements made by the City. Generally, assessment collections are deferred over
periods ranging from ten to twenty years with interest charged at 1% over the City’s
borrowing rate. Revenue from these assessments is recognized when assessed in the
government-wide financial statements and as the annual installments become
collectible in the governmental funds of the fund financial statements. Annual
installments not collected as of each December 31 are classified as delinquent
assessments receivable. The net amount of delinquent assessments receivable are
fully offset by deferred inflows of resources in the governmental funds of the fund
financial statements because they are not known to be available to finance current
expenditures.
3. Capital assets
Capital assets, which include property, plant, equipment, and infrastructure assets (e.g.,
roads, bridges, sidewalks, and similar items), are reported in the applicable
governmental or business-type activities columns in the government-wide financial
statements. Capital assets are defined by the City as assets with an initial, individual
cost of more than $25,000. Such assets are recorded at historical cost or estimated
historical cost if purchased or constructed. The costs of normal maintenance and repairs
that do not add to the value of the asset or materially extend assets lives are not
capitalized. Donated capital assets are recorded at estimated fair market value at the
date of donation.
Major outlays for capital assets and improvements are capitalized as projects are
constructed. Interest incurred during the construction phase of capital assets of
business-type activities, if material, is included as part of the capitalized value of the
assets constructed, net of interest earned on the invested debt proceeds over the same
period.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
43
1. Summary of Significant Accounting Policies (Continued)
D. Assets, Liabilities, Deferred Inflows of Resources and Net Position (Continued)
3. Capital assets (continued)
Property, plant and equipment are capitalized when acquired, and depreciation is
provided using the straight-line method applied over the following estimated useful lives
of the assets.
Useful Life
in Years
Buildings and Improvements 10 - 50
Infrastructure 20 - 40
Other Improvements 10 - 25
Machinery and Equipment 5 - 20
4. Postemployment benefits other than pensions
Under Minnesota Statute 471.61, subdivision 2b., public employers must allow retirees
and their dependents to continue coverage indefinitely in an employer-sponsored health
care plan, under the following conditions: 1) retirees must be receiving (or eligible to
receive) an annuity from a Minnesota public pension plan, 2) coverage must continue in
group plan until age 65, and retirees must pay no more than the group premium, and 3)
retirees may obtain dependent coverage immediately before retirement. All premiums
are funded on a pay-as-you-go basis. The postemployment benefit obligation liability
was determined using the alternative measurement method, in accordance with GASB
Statement No. 45.
5. Long-term obligations
In the government-wide financial statements and proprietary fund types in the fund
financial statements, long-term debt and other long-term obligations are reported as
liabilities in the applicable governmental activities, business-type activities or proprietary
fund type statements of net position.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
44
1. Summary of Significant Accounting Policies (Continued)
D. Assets, Liabilities, Deferred Inflows of Resources and Net Position (Continued)
5. Long-term obligations (continued)
Bond premiums and discounts are deferred and amortized over the life of the bonds
using the effective interest method. Bonds payable are reported net of the applicable
bond premium or discount. In the fund financial statements, governmental fund types
recognize bond premiums and discounts during the current period. The face amount of
debt issued is reported as other financing sources. Premiums received on debt
issuances are reported as other financing sources while discounts on debt issuances
are reported as other financing uses. Issuance costs, whether or not withheld from the
actual debt proceeds received, are reported as current expenditures.
6. Pensions
For purposes of measuring the net pension liability, deferred outflows/inflows of
resources and pension expense, information about the fiduciary net position of the
Public Employees Retirement Association (PERA) and additions to/deductions from
PERA's fiduciary net position have been determined on the same basis as they are
reported by PERA except that PERA's fiscal year end is June 30. For this purpose, plan
contributions are recognized as of employer payroll paid dates and benefit payments
and refunds are recognized when due and payable in accordance with the benefit terms.
Investments are reported at fair value.
7. Net Position and Fund Balance
In the government-wide and proprietary financial statements, net position is classified in
the following categories:
Net Investment in Capital Assets – This amount consists of capital assets net of
accumulated depreciation and reduced by outstanding debt attributed to the
acquisition, construction, or improvement of the assets.
Restricted Net Position – This amount is restricted by external creditors, grantors,
contributors, laws or regulations of other governments.
Unrestricted Net Position – This amount is all net position that does not meet the
definition of “net investment in capital assets” or “restricted net position.”
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
45
1. Summary of Significant Accounting Policies (Continued)
D. Assets, Liabilities, Deferred Inflows of Resources and Net Position (Continued)
7. Net Position and Fund Balance (continued)
The City classifies governmental fund balances as follows:
Non-spendable – includes fund balance amounts that cannot be spent either because
it is not in spendable form or because of legal or contractual restraints.
Restricted – This amount is restricted by external creditors, grantors, contributors, laws
or regulations of other governments.
Committed – includes amounts that can be used only for the specific purposes
imposed by formal action (resolution) of the City Council, which is the City's highest
level of decision-making authority. Those committed amounts cannot be used for any
other purpose unless the Council rescinds or changes the specified use by taking the
same type of action (resolution) it employed to previously commit those amounts.
Assigned – includes fund balance amounts that are intended to be used for specific
purposes that are neither considered restricted or committed. The City Council, by
majority vote, may assign fund balances to be used for specific purposes when
appropriate. The Council has delegated the power to assign fund balances to the
City's finance committee. Unlike commitments, assignments generally only exist
temporarily. In other words, an additional action does not normally have to be taken
for the removal of an assignment. Conversely, as discussed above, an additional
action is essential to either remove or revise a commitment.
Unassigned – includes positive fund balances within the General Fund which have not
been classified within the above mentioned categories and negative fund balances in
other governmental funds.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
46
1. Summary of Significant Accounting Policies (Continued)
D. Assets, Liabilities, Deferred Inflows of Resources and Net Position (Continued)
7. Net Position and Fund Balance (continued)
The City considers restricted/committed amounts to be spent first when both restricted
and unrestricted fund balance is available unless there are legal documents/contracts
that prohibit doing this, such as a grant agreement requiring dollar for dollar spending.
Additionally, the City would first use committed, then assigned and lastly unassigned
amounts when expenditures are made. The City Council has formally adopted a fund
balance policy for the General Fund. The City's policy is to maintain a minimum
unassigned fund balance in the General Fund equal to 50 percent of budgeted
expenditures to ensure funds are available at all times to meet cash flow needs and
accommodate emergency contingency concerns.
8. Interfund transactions
Interfund services provided and used are accounted for as revenues, expenditures or
expenses. Transactions that constitute reimbursements to a fund for
expenditures/expenses or revenues/income initially made from it that are properly
applicable to another fund are recorded as expenditures/expenses or revenues/income
in the fund that is reimbursed. All other interfund transactions, except interfund services
provided and used, are reported as transfers.
E. Concentration of Credit Risk
Financial instruments which expose the City to a concentration of credit risk consist primarily
of cash investments and accounts and loans receivable. Credit risk related to cash and
investments is discussed in Note 3A. The City's accounts and loans receivable are
concentrated geographically, and for the most part, amounts are due from individuals
residing in and businesses located in the City of Lake Elmo, Minnesota.
F. Use of Estimates
The preparation of financial statements in accordance with accounting principles generally
accepted in the United States of America (GAAP) requires management to make estimates
that affect amounts reported in the financial statements during the reporting period. Actual
results could differ from such estimates.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
47
2. Stewardship, Compliance and Accountability
A. Budgetary Information
Annual budgets are adopted on a basis consistent with accounting principles generally
accepted in the United States of America. Annual appropriated budgets are legally adopted
by Council resolution for the General Fund and the special revenue funds. Formal budgetary
integration is employed as a management control device during the year for these funds.
The City follows these legal compliance procedures in establishing the budgetary data
reflected in the financial statements.
1. Budget requests are submitted by all department heads to the City Administrator and
Finance Director in August of each year. The Administrator's office compiles the budget
requests into an overall preliminary City budget, balancing budget requests with
available revenue.
2. The preliminary budget is submitted to the City Council in September for its review
and/or modification.
3. City administration presents the proposed budget to the City Council which in turn, when
required, holds a truth-in-taxation public hearing on the proposed budget. The budget
resolution adopted by the City Council sets forth the budget at the department level for
the General Fund and the special revenue funds.
4. All budgeted appropriations lapse at the end of the fiscal year. The legal level of control
(the level on which expenditures may not legally exceed appropriations) for each budget
is at the department level. Administration cannot legally amend or transfer
appropriations between departments without the approval of the City Council once the
budget has been approved. Any over expenditures of appropriations or transfers of
appropriated amounts must be approved by the City Council.
5. Budgeted amounts are as originally adopted, or as amended by the City Council. The
budget cannot be amended without approval by the City Council.
All budget amounts presented as a basic financial statement or in the accompanying
supplementary information reflect the original budget and the final budget (which were the
same for the year ended December 31, 2016).
The City does not use encumbrance accounting.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
48
2. Stewardship, Compliance, and Accountability
B. Expenditures Exceeding Appropriations
For the year ended December 31, 2016, the General Fund total expenditures were $197,264
more than budget. The following funds and General Fund departments had expenditures
exceeding the latest amended budget:
2016 Budgeted
Expenditures
2016 Actual
Expenditures
Amount Exceeding
Budgeted Amount
General Fund:
General government 956,173$ 1,280,259$ 324,086$
Library Fund 256,957 331,901 74,944
The above listed over expenditures in the general government department were due primarily
to legal expenses incurred over the amounts budgeted. The expenditures in excess of
budget for the Library fund were related to repairs to the library building during the year.
All overexpenditures were approved by the City Council.
C. Fund Balance Deficits
As of December 31, 2016, the following funds had deficit fund balances:
Fund Amount
Nonmajor:
City Events Special Revenue 609$
Village Project Capital Project 400,546
Manning Avenue/Highway 36 Capital Project 4,897
The fund balance deficits will be eliminated by future revenue and financing sources.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
49
3. Detailed Notes on All Funds
A. Deposits and Investments
In accordance with applicable Minnesota statutes, the City maintains deposits at depository
banks authorized by the City Council. All such depositories are members of the Federal
Reserve System.
Minnesota statutes require that all deposits be protected by insurance, surety bond or
collateral. The market value of collateral pledged must equal 110% of the deposits not
covered by insurance or surety bonds. Authorized collateral includes certain state or local
government obligations and legal investments described in the investment policy section.
Minnesota Statutes require that securities pledged as collateral be held in safekeeping by
the City Treasurer or in a financial institution other than the institution furnishing the
collateral.
The City's deposits were entirely covered by federal depository insurance or collateral at
December 31, 2016.
Investment Policy
The City does not maintain a formal investment policy that limits investment maturities as
a means of managing its exposure to fair value losses arising from increasing interest rates
or that would limit its investment choices as a means of managing its exposure to credit
risk.
The City is authorized by Minnesota Statutes to invest idle funds as follows:
(a) Direct obligations or obligations guaranteed by the United States or its agencies.
(b) Shares of investment companies registered under the Federal Investment Company Act
of 1940 and whose only investments are in securities described in (a) above.
(c) General obligations of the State of Minnesota or its municipalities.
(d) Bankers acceptances of United States banks eligible for purchase by the Federal
Reserve System.
(e) Commercial paper issued by United States corporations or their Canadian subsidiaries,
of the highest quality, and maturing in 270 days or less.
(f) Repurchase agreements with banks that are members of the Federal Reserve System
with capitalization exceeding $10,000,000, a reporting dealer to the Federal Reserve
Bank of New York, or certain Minnesota securities broker-dealers.
(g) Money market funds with institutions that have portfolios consisting exclusively of United
States Treasury obligations and Federal Agency issues.
(h) Guaranteed investment contracts (gic's) issued or guaranteed by United States
commercial banks or domestic branches of foreign banks or United States insurance
companies and with a credit quality in one of the top two highest categories.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
50
3. Detailed Notes on All Funds (Continued)
A. Deposits and Investments (Continued)
Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair
value of an investment. Generally, the longer the maturity of an investment, the greater the
sensitivity of its fair value to changes in market interest rates. One of the ways that the City
manages its exposure to interest rate risk is by purchasing a combination of shorter and
longer term investments and by timing cash flows from maturities so that a portion of the
portfolio is maturing or coming close to maturity evenly over time as necessary to provide the
cash flow and liquidity needs for operation.
The following is a summary of the City of Lake Elmo, Minnesota's cash and investment
portfolio including the range of maturities and investment ratings by type of investment:
Investment Range of Maturities Rating Value
Cash N/A N/A 11,127,493$
Certificates of Deposit 10/22 N/A 2,933,500
Municipal Bonds 12/18 A 363,667
U.S. Government Agencies 10/23 AAA 1,536,750
Total cash and investments 15,961,410$
N/A Not applicable or not available
A reconciliation of cash and temporary investments as shown on the Statement of Net
Position for the City follows:
Carrying amount of deposits 11,127,493$
Investments 4,833,917
Total 15,961,410$
Government-wide
Cash and investments 13,566,883$
Fiduciary
Cash and investments 2,394,526
Total 15,961,409$
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
51
3. Detailed Notes on All Funds (Continued)
A. Deposits and Investments (Continued)
Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to
the holder of the investment. The City's investments are rated by various credit rating
agencies, where applicable, to indicate the associated credit risk. Investment ratings by
investment type (as applicable) are included in the preceding summary of investments.
Concentration of Credit Risk
Investments in any one issuer that represented 5% or more of total investments as of
December 31, 2016 were as follows:
Issuer Investment Type Value
Lake Elmo Bank Money Market Savings 10,608,299$
The City routinely reviews its deposits to determine that pledged securities are adequate to
cover any uninsured deposits.
Custodial Credit Risk
For an investment, custodial credit risk is the risk that, in the event of the failure of the counter
party, the City will not be able to recover the value of its investment securities that are in the
possession of an outside party. At December 31, 2016, all investments were insured or
registered or the securities were held by the City or its agent in the City's name.
Fair Value Measurements
Fair value measurements are determined utilizing the framework established by the
Governmental Accounting Standards Board. The framework provides a fair value hierarchy
that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy
gives the highest priority to unadjusted quoted prices in active markets for identical assets or
liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3
measurements). The three levels of the fair value hierarchy are as follows:
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
52
3. Detailed Notes on All Funds (Continued)
A. Deposits and Investments (Continued)
Fair Value Measurements (continued)
Level 1: Inputs to the valuation methodology are unadjusted quoted prices for identical
assets or liabilities in active markets that the City has the ability to access.
Level 2: Inputs to the valuation methodology include:
o Quoted prices for similar assets or liabilities in active markets
o Quoted prices for identical assets or liabilities in inactive markets
o Inputs other than quoted prices that are observable for the asset or liability
o Inputs that are derived principally from or corroborated by observable market
data by correlation or other means.
If the asset or liability has a specific (contractual) term, Level 2 input must be
observable for substantially the full term of the asset or liability.
Level 3: Inputs to the valuation methodology are unobservable and significant to the fair
value measurement.
The asset’s or liability’s fair value measurement level within the fair value hierarchy is based
on the lowest level of any input that is significant to the fair value measurement. Valuation
techniques used need to maximize the use of observable inputs and minimize the use of
unobservable inputs.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
53
3. Detailed Notes on All Funds (Continued)
A. Deposits and Investments (Continued)
Fair Value Measurements (continued)
The City’s investments within the fair value hierarchy at December 31, 2016 and 2015 were
as follows:
Assets
Measured at
Fair Value Level 1 Level 2 Level 3
U.S. Government
Securities 1,536,750$ $ 1,536,750$ $
Certificates of Deposit 2,933,500 2,933,500
Municipal Bonds 363,667 363,667
Total 4,833,917$ 2,933,500$ 1,900,417$ $
Assets
Measured at
Fair Value Level 1 Level 2 Level 3
U.S. Government
Securities 1,133,809$ $ 1,133,809$ $
Certificates of Deposit 4,932,107 4,932,107
Municipal Bonds 365,072 365,072
Total 6,430,988$ 4,932,107$ 1,498,881$ $
Fair Value Hierarchy Level
As of December 31, 2016
As of December 31, 2015
Fair Value Hierarchy Level
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
54
3. Detailed Notes on All Funds (Continued)
B. Due from Other Governmental Units
Amounts due from other governmental units as of December 31, 2016 were as follows:
Fund Type
State of
Minnesota
Washington
County Total
General Fund $ 39,274$ 39,274$
Debt Service Fund 4,834 4,834
Water Fund 3,432,302 183 3,432,485
Sewer Fund 1,466 1,466
Storm Sewer Fund 251 251
Total 3,432,302$ 46,008$ 3,478,310$
C. Accounts and Loans Receivable
Accounts and loans receivable as of December 31, 2016 are expected to be collected in full.
Based upon management's assessment of the creditworthiness of the customers comprising
the receivable balance, no allowance for uncollectible accounts is necessary.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
55
3. Detailed Notes on All Funds (Continued)
D. Capital Assets
Capital asset activity for the City for the year ended December 31, 2016 was as follows:
Beginning Ending
Governmental Activities Balance Increases Decreases Balance
Capital assets, not being depreciated:
Land $ 3,453,979 $ $ $ 3,453,979
Construction in progress 2,857,416 2,971,529 1,410,393 4,418,552
Total capital assets, not being depreciated 6,311,395 2,971,529 1,410,393 7,872,531
Capital assets, being depreciated:
Buildings 3,533,542 3,533,542
Improvements other than buildings 1,347,650 67,747 1,415,397
Machinery and equipment 3,737,075 130,270 3,867,345
Infrastructure 10,174,623 1,410,393 11,585,016
Total capital assets, being depreciated 18,792,890 1,608,410 20,401,300
Less accumulated depreciation for:
Building 884,193 72,408 956,601
Improvements other than buildings 907,981 68,420 976,401
Machinery and equipment 2,127,568 183,605 2,311,173
Infrastructure 2,656,904 617,718 3,274,622
Total accumulated depreciation 6,576,646 942,151 7,518,797
Total capital assets, being depreciated, net 12,216,244 666,259 12,882,503
Governmental activities capital assets, net 18,527,639$ 3,637,788$ 1,410,393$ 20,755,034$
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
56
3. Detailed Notes on All Funds (Continued)
D. Capital Assets (Continued)
Beginning Ending
Business-Type Activities Balance Increases Decreases Balance
Capital assets, not being depreciated:
Land $ 248,869 $ $ $ 248,869
Construction in progress 4,193,729 8,207,773 5,375,976 7,025,526
Total capital assets, not being depreciated 4,442,598 8,207,773 5,375,976 7,274,395
Capital assets, being depreciated:
Machinery and equipment 300,587 300,587
Infrastructure 22,176,345 5,375,976 27,552,321
Total capital assets, being depreciated 22,476,932 5,375,976 27,852,908
Less accumulated depreciation for:
Machinery and equipment 200,075 16,051 216,126
Infrastructure 3,926,620 744,528 4,671,148
Total accumulated depreciation 4,126,695 760,579 4,887,274
Total capital assets, being depreciated, net 18,350,237 4,615,397 22,965,634
Business-type activities capital assets, net 22,792,835$ 12,823,170$ 5,375,976$ 30,240,029$
Certain assets in the City's business-type activities have been partially funded by grants from
the State of Minnesota and therefore are considered jointly owned property. In the unlikely
event the City would sell these assets, the City would be required to reimburse the State up
to the full amount of the grants.
Depreciation expense for the year ended December 31, 2016 was charged to
functions/programs as follows:
Governmental Activities
General government 11,471$
Public safety 119,657
Public works 729,004
Culture and recreation 82,019
Total 942,151$
Business-Type Activities
Water 612,352$
Sewer 132,265
Storm sewer 15,962
Total 760,579$
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
57
3. Detailed Notes on All Funds (Continued)
E. Long-Term Debt
The City issues general obligation bonds to provide funds for economic development and
for the acquisition and construction of major capital assets including infrastructure. General
obligation bonds have been issued for both governmental and business-type activities.
Bonds issued to provide funds for business-type activities are reported in proprietary funds
if they are expected to be repaid from proprietary revenues. General obligation bonds are
direct obligations and pledge the full faith and credit of the City. General obligation
improvement bonds are expected to be repaid, in part, from assessments to the benefited
properties. A summary of long-term debt outstanding at December 31, 2016 is as follows:
Range of Final Balance
Issue Date Interest Rates Maturity 12/31/16
General obligation bonds:
2009B Improvement Bonds 10/1/2009 3.00% - 3.05% 2020 250,000$
2010A Improvement Bonds 11/15/2010 1.85% - 2.80% 2021 365,000
2010B CIP Crossover Refunding Bonds 11/15/2010 2.00% - 3.20% 2025 1,535,000
2011A Improvement Bonds 10/1/2011 1.25% - 2.30% 2022 525,000
2012B Improvement Bonds 8/16/2012 0.75% - 1.90% 2023 625,000
2013A Improvement Bonds 10/1/2013 2.00% - 3.75% 2028 1,345,000
2014A Improvement Bonds 7/15/2014 2.00% - 3.50% 2030 2,670,000
2015A Improvement Bonds 8/13/2015 2.00% - 3.00% 2031 1,620,000
2016A Improvement Bonds 6/1/2016 2.00% 2027 2,690,000
General obligation revenue bonds:
2009A Refunding Bonds 5/1/2009 3.45% - 3.85% 2021 240,000
2012A Refunding Bonds 8/13/2012 2.00% - 2.50% 2030 3,840,000
2013A Improvement Bonds 10/1/2013 2.00% - 4.00% 2033 3,435,000
2014A Improvement Bonds 7/15/2014 2.00% - 3.50% 2030 3,210,000
2015A Improvement Bonds 8/13/2015 2.00% - 3.00% 2031 1,195,000
2016A Improvement Bonds 6/1/2016 2.00% 2032 6,855,000
Other Liabilities:
Compensated Absences 88,123
Post Employment Benefit Obligation 237,241
Unamortized premium 480,485
Less: Unamortized discount (142,522)
Total Long-Term Debt 31,063,327$
Liquidation of the compensated absences liability occurs within the department and fund
for which the corresponding employees are assigned. The City is subject to statutory
limitation by the State of Minnesota for bonded indebtedness payable principally from
property taxes. As of December 31, 2016, the City had not utilized approximately
$35,930,000 of its net legal debt margin.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
58
3. Detailed Notes on All Funds (Continued)
E. Long-Term Debt (Continued)
The following is a summary of the changes in long-term debt obligations for the year ended
December 31, 2016:
Amounts
Beginning Ending Due Within
Balance Additions Reductions Balance One Year
GOVERNMENTAL ACTIVITIES
Bonds and Notes Payable:
General obligation bonds:
2009A Refunding Bonds 70,000$ $ 70,000$ $ $
2009B Improvement Bonds 310,000 60,000 250,000 60,000
2010A Improvement Bonds 435,000 70,000 365,000 70,000
2010B CIP Crossover Refunding Bonds 1,685,000 150,000 1,535,000 155,000
2011A Improvement Bonds 610,000 85,000 525,000 85,000
2012B Improvement Bonds 710,000 85,000 625,000 85,000
2013A Improvement Bonds 1,450,000 105,000 1,345,000 105,000
2014A Improvement Bonds 2,850,000 180,000 2,670,000 210,000
2015A Improvement Bonds 1,620,000 1,620,000 140,000
2016A Improvement Bonds 2,690,000 2,690,000
General obligation note payable:
Note Payable - Lake Elmo Bank 21,219 21,219
Other Liabilities:
Compensated Absences 70,161 90,110 95,648 64,623 48,467
Post Employment Benefit Obligation 174,282 32,137 206,419
Unamortized premium 93,353 102,877 14,438 181,792
Less: Unamortized (discount) (50,262) (14,392) (5,430) (59,224)
Governmental Activities
Long-Term Liabilities 10,048,753 2,900,732 930,875 12,018,610 958,467
BUSINESS-TYPE ACTIVITIES
Bonds and Notes Payable:
General obligation revenue bonds:
2009A Refunding Bonds 280,000 40,000 240,000 45,000
2012A Refunding Bonds 4,035,000 195,000 3,840,000 190,000
2013A Improvement Bonds 3,640,000 205,000 3,435,000 205,000
2014A Improvement Bonds 3,385,000 175,000 3,210,000 205,000
2015A Improvement Bonds 1,195,000 1,195,000 60,000
2016A Improvement Bonds 6,855,000 6,855,000
Other Liabilities:
Compensated Absences 8,364 44,973 29,837 23,500 17,625
Post Employment Benefit Obligation 24,696 6,126 30,822
Unamortized premium 138,007 173,586 12,900 298,693
Less: Unamortized (discount) (50,523) (36,674) (3,899) (83,298)
Business-Type Activities
Long-Term Liabilities 12,655,544 7,043,011 653,838 19,044,717 722,625
Total 22,704,297$ 9,943,743$ 1,584,713$ 31,063,327$ 1,681,092$
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
59
3. Detailed Notes on All Funds (Continued)
E. Long-Term Debt (Continued)
Debt service requirements to maturity for long-term debt, excluding compensated
absences and post employment benefit obligation, as of December 31, 2016 were as
follows:
Year Principal Interest Principal Interest
2017 910,000$ 267,528$ 705,000$ 457,498$
2018 1,175,000 240,855 1,145,000 422,505
2019 1,205,000 216,853 1,165,000 399,256
2020 1,230,000 191,308 1,175,000 375,525
2021 1,185,000 165,371 1,185,000 351,212
2022-2026 4,760,000 456,118 6,215,000 1,355,536
2027-2031 1,160,000 60,001 6,240,000 562,101
2032-2033 945,000 30,800
Totals 11,625,000$ 1,598,031$ 18,775,000$ 3,954,431$
General Obligation
Improvement Bonds
General Obligation Revenue
Bonds
F. Tax Abatement Agreements
The City enters into property tax abatement agreements through the use of tax increment
financing districts with local businesses under various Minnesota Statutes. Under these
statutes, the City annually abates taxes collected above the districts’ base tax capacity which
is established during adoption of the tax increment district. These agreements are
established to foster economic development and redevelopment through creating jobs,
removing blight and providing affordable housing. The City uses Minnesota Statutes 469.001
to 469.047 and 469.174 to 469.179 (the Tax Increment Act) to create these districts.
During the year ended December 31, 2016, the City had one agreement established under
Minnesota Statute 469.001 to 469.047 which resulted in property taxes totaling $3,629 being
abated.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
60
3. Detailed Notes on All Funds (Continued)
F. Interfund Receivables and Payables
The following schedule reports the interfund receivables and payables within the City's funds
as of December 31, 2016:
Due From Due To
Other Funds Other Funds
Major Governmental Funds:
General Fund 200,937$ $
Debt Service 95,605
Infrastructure Reserve 7,032
Subtotal 200,937 102,637
Nonmajor Governmental Funds:
City Events 1,144
Village Project 56,760
Subtotal 57,904
Proprietary Funds:
Water 795
Sewer 54,305
Storm Sewer 23,915
Subtotal 78,220 795
Internal Service Funds:
Radio Replacement 41,740
FFE Replacement 76,081
Subtotal 117,821
Total All Funds 279,157$ 279,157$
Interfund receivables and payables are the result of expenditures of funds prior to the
collection of special assessments, property taxes and other revenues. All interfund balances
will be repaid as the revenues are collected by the individual funds.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
61
3. Detailed Notes on All Funds (Continued)
F. Interfund Receivables and Payables (continued)
The City established an interfund loan from the General Fund to the Village Project fund. At
December 31, 2016, the outstanding balance was $405,398. The loan carries an interest
rate of 4 percent.
G. Interfund Transfers
The following schedule reports the interfund transfers within the City's funds as of December
31, 2016:
Transfers In Transfers Out
Major Governmental Funds:
Debt Service 143,105$ $
Proprietary Funds:
Water 40,427
Sewer 102,678
Total All Funds 143,105$ 143,105$
Transfers are used to move unassigned revenues to finance various programs that the
government must account for in other funds in accordance with budgetary authorizations.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
62
3. Detailed Notes on All Funds (Continued)
H. Fund Equity
In accordance with the requirements of GASB Statement No. 54, below is a schedule of
ending fund balances as of December 31, 2016:
General Debt Service
Infrastructure
Reserve
Vehicle
Acquisition
Other
Governmental
Funds
Total
Governmental
Funds
Nonspendable
Prepaid items 3,824$ $ $ $ $ 3,824$
Advance to other funds 405,398 405,398
Total Nonspendable 409,222 409,222
Restricted
Debt service 3,248,230 3,248,230
Committed
Legal reserve 200,000 200,000
Assigned
Library 174,540 174,540
City facilities 272,924 272,924
Infrastructure improvements 29,871 8,089 37,960
Park improvements 980,041 980,041
Vehicle acquisition 39,191 39,191
Total Assigned 29,871 39,191 1,435,594 1,504,656
Unassigned 3,279,815 (12,117) (406,052) 2,861,646
Total Fund Balance 3,889,037$ 3,236,113$ 29,871$ 39,191$ 1,029,542$ 8,223,754$
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
63
4. Other Information
A. Risk Management
The City is exposed to various risks of loss related to torts: theft of, damage to, or destruction
of assets; errors or omissions; injuries to employees; and natural disasters. The City
participates in the League of Minnesota Cities Insurance Trust (LMCIT) to provide its general
liability and property coverage. The LMCIT is a public entity risk pool currently operating as
a common risk management and insurance program for participating Minnesota Cities. All
Cities in the LMCIT are jointly and severally liable for all claims and expenses of the pool.
The amount of any liability in excess of assets of the pool may be assessed to the
participating cities if a deficiency occurs. The City purchases commercial insurance for
property values in excess of the LMCIT policy limits and all other risks of loss. Settled claims
have not exceeded the LMCIT or commercial coverage in any of the past three fiscal years.
Worker's compensation insurance is also purchased through the LMCIT. The worker
compensation program is a retrospectively rated contract with premiums or required
contributions based primarily on the experience rates of the participating cities. There were
no significant reductions in insurance coverage from the previous year or settlements in
excess of insurance coverage for any of the past three fiscal years.
B. Commitments and Contingencies
General Litigation:
Although the City is occasionally involved in litigation, management was unaware of any
pending lawsuits in which the City was involved as of December 31, 2016. It is the opinion
of management that any potential claim regarding any lawsuits against the City would be
covered by the liability insurance of the City and that any potential claim against the City
would not affect the financial statements.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
64
4. Other Information (Continued)
B. Commitments and Contingencies (Continued)
Operating Lease:
The City is obligated under a lease agreement for office space accounted for as an operating
lease. Expenditures under this operating lease for the year ended December 31, 2016 totaled
$30,147. The following is a schedule by year of future minimum rental payments required
under the lease as of December 31, 2016:
Year Ending
December 31, Amount
2017 31,992$
2018 32,301
2019 24,921
Total 89,214$
C. Other Post Employment Benefits
Plan Description
The City administers a single-employer defined benefit healthcare plan ("the Retiree Health
Plan"). The plan provides healthcare insurance for eligible retirees and their spouses through
the City's group health insurance plan until Medicare age, which covers both active and
retired members. During 2016, there were 20 active participants and no retiree participants.
Benefit provisions are established by the Council. The Retiree Health Plan does not issue a
publicly available financial report.
Funding Policy
The City has historically funded these liabilities on a pay-as-you-go basis. Contribution
requirements are negotiated between the City and union representatives on a per contract
basis. At the present time, no retiree benefits are provided except the allowance to continue
health insurance that is mandated by Minnesota Law. The City does not contribute any of
the cost of current-year premiums for eligible retired plan members or their spouses. Plan
members receiving benefits contribute 100 percent of their premium costs.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
65
4. Other Information (Continued)
C. Other Post Employment Benefits (Continued)
Annual Other Postemployment Benefit Cost and Net Other Postemployment Benefit
Obligations
The City's annual other postemployment benefit (OPEB) cost (expense) is calculated based
on the annual required contribution of the employer (ARC). The City has elected to calculate
the ARC and related information using the alternative measurement method permitted by
GASB Statement No. 45 for employers in plans with fewer than one hundred total plan
members. The ARC represents a level of funding that, if paid on an ongoing basis, is
projected to cover normal cost each year and to amortize any unfunded actuarial liabilities
(or funding excess) over a period not to exceed thirty years. The following table shows the
components of the City's annual OPEB cost for the year, the amount actually contributed to
the plan, and changes in the City's net OPEB obligation:
Annual required contribution 46,247$
Interest on net OPEB obligations 1,347
Adjustment to ARC (9,331)
Annual OPEB cost 38,263
Contributions during the year
Increase in net OPEB obligation 38,263
Net OPEB, beginning of year 198,978
Net OPEB, ending of year 237,241$
The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan,
and the net OPEB obligation for fiscal years ended December 31, 2016, 2015 and 2014 are
as follows:
Fiscal Year
Ended
Annual
OPEB Cost
Percentage
Contributed
Net OPEB
Obligation
12/31/2014 2,484$ 0% 160,187$
12/31/2015 38,791 0% 198,978
12/31/2016 38,263 0% 237,241
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
66
4. Other Information (Continued)
C. Other Post Employment Benefits (Continued)
Funded Status and Funding Progress
As of January 1, 2016, the actuarial accrued liability for benefits was $188,502, all of which
was unfunded. The covered payroll (annual payroll of active employees covered by the plan)
was $1,417,483, and the ratio of the unfunded actuarial accrued liability to the covered payroll
was 13.30 percent.
The projection of future benefit payments for an ongoing plan involves estimates of the value
of reported amounts and assumptions about the probability of occurrence of events far into
the future. Examples include assumptions about future employment, mortality, and the
healthcare cost trend. Amounts determined regarding the funded status of the plan and the
annual required contributions of the employer are subject to continual revisions as actual
results are compared with past expectations and new estimates are made about the future.
The schedule of funding progress, presented as required supplementary information
following the notes to financial statements, presents multi-year trend information about
whether the actuarial value of plan assets is increasing or decreasing over time relative to
the actuarial accrued liabilities for benefits.
Methods and Assumptions
Projections of benefits for financial reporting purposes are based on the substantive plan (the
plan as understood by the employer and plan members) and include the types of benefits
provided at the time of each valuation and the historical pattern of sharing of benefit costs
between the employer and plan members to that point. The actuarial methods and
assumptions used include techniques that are designed to reduce the effects of short-term
volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the
long-term perspective of the calculations. The projected unit credit cost method was used.
The following simplifying assumptions were made:
Retirement age for active employees - Based on the historical average retirement age for the
covered group, active plan members were assumed to retire at age 63, or at the first
subsequent year in which the member would qualify for benefits. In addition, spouses of
retired employees were assumed to continue on the plan for the lesser of eighteen months
after the retired employee reaches Medicare age or until the spouse reaches Medicare age.
Marital status - Marital status of members at the calculation date was assumed to continue
throughout retirement.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
67
4. Other Information (Continued)
C. Other Post Employment Benefits (Continued)
Methods and Assumptions (Continued)
Mortality - Life expectancies were based on mortality tables from the National Center for
Health Statistics. The 2004 United States Life Tables for Males and Females was used.
Turnover - Non-group-specific age-based turnover data from GASB Statement No. 45 were
used as the basis for assigning active members a probability of remaining employed until the
assumed retirement age and for developing expected future working lifetime assumptions for
purposes of allocation to periods the present value of total benefits to be paid.
Healthcare cost trend rate - The expected rate of increase in healthcare insurance premiums
was based on projections of the Office of the Actuary at the Centers for Medicare & Medicaid
Services. A rate of 2.0 percent initially, rising to an ultimate rate of 6.0 percent after six years,
was used.
Health insurance premiums - 2016 health insurance premiums for retirees were used as the
basis for calculation of the present value of total benefits to be paid.
Inflation rate - The expected long-term inflation assumption of 4.00 percent was based on
projected changes in the Consumer Price Index for Urban Wage Earners and Clerical
Workers (CPI-W).
Payroll growth rate - The expected long-term payroll growth rate was assumed to equal the
rate of inflation.
Based on the historical and expected return of the City's short-term investment portfolio, a
discount rate of 3.0 percent was used. In addition, a simplified version of the entry age
actuarial cost method was used. The unfunded actuarial accrued liability is being amortized
as a level percentage of projected payroll on an open basis. The remaining amortization
period at December 31, 2016 was thirty years.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
68
4. Other Information (Continued)
D. Pension Plans
1. Public Employees Retirement Association (PERA) - Defined Benefit
A. Plan Description
The City participates in the following cost-sharing multiple-employer defined benefit
pension plans administered by the Public Employees Retirement Association of
Minnesota (PERA). PERA's defined benefit pension plans are established and
administered in accordance with Minnesota Statutes, Chapters 353 and 356. PERA's
defined benefit pension plans are tax qualified under Section 401(a) of the Internal
Revenue Code.
1. General Employees Retirement Plan (General Employees Plan (accounted for in the
General Employees Fund)) – All full-time and certain part-time employees of the City
of Lake Elmo are covered by the General Employees Retirement Plan. General
Employees Plan members belong to either the Coordinated Plan or the Basic Plan.
Coordinated Plan members are covered by Social Security and Basic Plan members
are not. The Basic Plan was closed to new members in 1967. All new members must
participate in the Coordinated Plan.
2. Public Employees Police and Fire Plan (Police and Fire Plan (accounted for in the
Police and Fire Fund)) – The Police and Fire Plan, originally established for police
officers and firefighters not covered by a local relief association, now covers all police
officers and firefighters hired since 1980. Effective July 1, 1999, the Police and Fire
Plan also covers police officers and firefighters belonging to a local relief association
that elected to merge with and transfer assets and administration to PERA.
Benefits Provided
PERA provides retirement, disability and death benefits. Benefit provisions are
established by state statute and can only be modified by the state legislature.
Benefit increases are provided to benefit recipients each January. Increases are related
to the funding ratio of the plan. Members in plans that are at least 90 percent funded for
two consecutive years are given 2.5% increases. Members in plans that have not
exceeded 90% funded, or have fallen below 80%, are given 1% increases.
The benefit provisions stated in the following paragraph of this section are current
provisions and apply to active plan participants. Vested, terminated employees who are
entitled to benefits but are not receiving them yet are bound by the provisions in effect
at the time they last terminated their public service.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
69
4. Other Information (Continued)
D. Pension Plans (Continued)
1. Public Employees Retirement Association (PERA) - Defined Benefit (Continued)
A. Plan Description (continued)
1. General Employees Plan Benefits
General Employees Plan benefits are based on a member's highest average salary for
any five successive years of allowable service, age, and years of credit at termination of
service. Two methods are used to compute benefits for PERA’s Coordinated and Basic
Plan members. The retiring member receives the higher of step-rate benefit accrual
formula (Method 1) or a level accrual formula (Method 2). Under Method 1, the annuity
accrual rate for a Basic Plan member is 2.2% of average salary for each of the first ten
years of service and 2.7% for each remaining year. The annuity accrual rate for a
Coordinated Plan member is 1.2% of average salary for each of the first ten years and
1.7% for each remaining year. Under Method 2, the annuity accrual rate is 2.7% of
average salary for Basic Plan members and 1.7% for Coordinated Plan members for
each year of service. For members hired prior to July 1, 1989, a full annuity is available
when age plus years of service equal 90 and normal retirement age is 65. For members
hired on or after July 1, 1989, normal retirement age is the age for unreduced Social
Security benefits capped at 66.
2. PEPFF Benefits
Benefits for Police and Fire Plan members first hired after June 30, 2010, but before July
1, 2014, vest on a prorated basis from 50% after five years up to 100% after ten years
of credited service. Benefits for Police and Fire Plan members first hired after June 30,
2014, vest on a prorated basis from 50% after ten years up to 100% after twenty years
of credited service. The annuity accrual rate is 3% of average salary for each year of
service. For Police and Fire Plan members who were first hired prior to July 1, 1989, a
full annuity is available when age plus years of service equal at least 90.
B. Contributions
Minnesota Statutes Chapter 353 sets the rates for employer and employee
contributions. Contribution rates can only be modified by the state legislature.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
70
4. Other Information (Continued)
D. Pension Plans (Continued)
1. Public Employees Retirement Association (PERA) - Defined Benefit (Continued)
B. Contributions (continued)
1. General Employees Fund Contributions
Basic Plan members and Coordinated Plan members were required to contribute 9.10%
and 6.50%, respectively, of their annual covered salary in calendar year 2016. The City
was required to contribute 11.78% of pay for Basic Plan members and 7.50% for
Coordinated Plan members in calendar year 2016. The City's contributions to the
General Employees Fund for the year ended December 31, 2016 were $85,649. The
City's contributions were equal to the required contributions as set by state statute.
2. Police and Fire Fund Contributions
Plan members were required to contribute 10.80% of their annual covered salary in
calendar year 2016. The City was required to contribute 16.20% of pay for members in
calendar year 2016. The City's contributions to the Police and Fire Fund for the year
ended December 31, 2016 were $13,967. The City's contributions were equal to the
required contributions as set by state statute.
C. Pension Costs
1. General Employees Fund Pension Costs
At December 31, 2016, the City reported a liability of $1,291,001 for its proportionate
share of the General Employees Fund’s net pension liability. The City’s net pension
liability reflected a reduction due to the State of Minnesota’s contribution of $6 million to
the fund in 2016. The State of Minnesota is considered a non-employer contributing
entity and the state’s contribution meets the definition of a special funding situation. The
State of Minnesota’s proportionate share of the net pension liability associated with the
City totaled $16,853. The net pension liability was measured as of June 30, 2016, and
the total pension liability used to calculate the net pension liability was determined by an
actuarial valuation as of that date. The City's proportion of the net pension liability was
based on the City's contributions received by PERA during the measurement period for
employer payroll paid dates from July 1, 2015 through June 30, 2016 relative to the total
employer contributions received from all of PERA's participating employers. At June 30,
2016, the City's proportion share was .0159% which was a decrease of .001% from its
proportion measured as of June 30, 2015.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
71
4. Other Information (Continued)
D. Pension Plans (Continued)
1. Public Employees Retirement Association (PERA) - Defined Benefit (Continued)
C. Pensions Costs (continued)
1. General Employees Fund Pension Costs (continued)
For the year ended December 31, 2016, the City recognized pension expense of
$178,937 for its proportionate share of the General Employees Plan’s pension expense.
In addition, the City recognized an additional $5,025 as pension expense (and grant
revenue) for its proportionate share of the State of Minnesota’s contribution of $6 million
to the General Employees Fund.
At December 31, 2016, the City reported its proportionate share of the General
Employees Plan’s deferred outflows of resources and deferred inflows of resources
related to pensions from the following sources:
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Differences between expected and actual
economic experience $ 106,617$
Changes in actuarial assumptions 252,779
Difference between projected and actual
investment earnings 248,717
Changes in proportion 90,542
Contributions paid to PERA subsequent to
the measurement date 44,719
Total 546,215$ 197,159$
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
72
4. Other Information (Continued)
D. Pension Plans (Continued)
1. Public Employees Retirement Association (PERA) - Defined Benefit (Continued)
C. Pensions Costs (continued)
1. General Employees Fund Pension Costs (continued)
$44,719 reported as deferred outflows of resources related to pensions resulting from
City contributions subsequent to the measurement date will be recognized as a
reduction of the net pension liability in the year ended December 31, 2017. Other
amounts reported as deferred outflows and inflows of resources related to pensions will
be recognized in pension expense as follows:
Year ending June 30:
Pension Expense
Amount
2017 72,383$
2018 72,383
2019 112,938
2020 46,633
2. Police and Fire Fund Pension Costs
At December 31, 2016, the City reported a liability of $361,186 for its proportionate share
of the Police and Fire Fund’s net pension liability. The net pension liability was
measured as of June 30, 2016, and the total pension liability used to calculate the net
pension liability was determined by an actuarial valuation as of that date. The City's
proportion of the net pension liability was based on the City's contributions received by
PERA during the measurement period for employer payroll paid dates from July 1, 2015
through June 30, 2016, relative to the total employer contributions received from all of
PERA's participating employers. At June 30, 2016, the City's proportion was .009%,
which is unchanged from its proportion measured as of June 30, 2015. The City also
recognized $810 for the year ended December 31, 2016 as revenue and an offsetting
reduction of net pension liability for its proportionate share of the State of Minnesota’s
on-behalf contributions to the Police and Fire Fund. Legislation passed in 2013 required
the State of Minnesota to begin contributing $9 million to the Police and Fire Fund each
year, starting in fiscal year 2014.
For the year ended December 31, 2016, the City recognized pension expense of
$61,416 for its proportionate share of the Police and Fire Plan’s pension expense.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
73
4. Other Information (Continued)
D. Pension Plans (Continued)
1. Public Employees Retirement Association (PERA) - Defined Benefit (Continued)
C. Pensions Costs (continued)
2. Police and Fire Fund Pension Costs (continued)
At December 31, 2016, the City reported its proportionate share of the Police and Fire
Plan’s deferred outflows of resources and deferred inflows of resources related to
pensions from the following sources:
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Differences between expected and actual
economic experience $ 39,223$
Changes in actuarial assumptions 198,776
Difference between projected and actual
investment earnings 55,119
Contributions paid to PERA subsequent to
the measurement date 7,561
Total 261,456$ 39,223$
$7,561 reported as deferred outflows of resources related to pensions resulting from
City contributions subsequent to the measurement date will be recognized as a
reduction of the net pension liability in the year ended December 31, 2017. Other
amounts reported as deferred outflows and inflows of resources related to pensions will
be recognized in pension expense as follows:
Year ending June 30:
Pension Expense
Amount
2017 43,487$
2018 43,487
2019 49,015
2020 44,561
2021 34,122
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
74
4. Other Information (Continued)
D. Pension Plans (Continued)
1. Public Employees Retirement Association (PERA) - Defined Benefit (Continued)
D. Actuarial Assumptions
The total pension liability in the June 30, 2016 actuarial valuation was determined using
the following actual assumptions:
Inflation 2.50% per year
Active Member Payroll Growth 3.25% per year
Investment Rate of Return 7.50%
Salary increases were based on a service-related table. Mortality rates for active
members, retirees, survivors and disabilitants were based on RP-2014 tables for the
General Employees Plan and RP-2000 tables for the Police and Fire Plan for males or
females, as appropriate, with slight adjustments. Cost of living benefit increases for
retirees are assumed to be 1% per year for all future years for the General Employees
Plan and Police and Fire Plan.
Actuarial assumptions used in the June 30, 2016 valuation were based on the result of
actuarial experience studies. The most recent four-year experience study in the General
Employees Plan was completed in 2015. The experience study for Police and Fire Plan
was for the period July 1, 2004 through June 30, 2009.
The following changes in actuarial assumptions occurred in 2016:
General Employees Fund
The assumed post-retirement benefit increase rate was changed from 1.0% per
year through 2035 and 2.5% per year thereafter to 1.0% per year for all future
years.
The assumed investment return was changed from 7.9% to 7.5%. The single
discount rate was changed from 7.9% to 7.5%.
Other assumptions were changed pursuant to the experience study dated June
30, 2015. The assumed future salary increases, payroll growth, and inflation
were decreased by 0.25% to 3.25% for payroll growth and 2.50% for inflation.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
75
4. Other Information (Continued)
D. Pension Plans (Continued)
1. Public Employees Retirement Association (PERA) - Defined Benefit (Continued)
D. Actuarial Assumptions (continued)
Police and Fire Fund
The assumed post-retirement benefit increase rate was changed from 1.0% per
year through 2037 and 2.5% thereafter to 1.0% per year for all future years.
The assumed investment return was changed from 7.9% to 7.5%. The single
discount rate changed from 7.9% to 5.6%.
The assumed future salary increases, payroll growth, and inflation were
decreased by 0.25% to 3.25% for payroll growth and 2.50% for inflation.
The State Board of Investment, which manages the investments of PERA, prepares an
analysis of the reasonableness of the long-term expected rate of return on a regular
basis using a building-block method in which best-estimate ranges of expected future
rates of return are developed for each major asset class. These ranges are combined
to produce an expected long-term rate of return by weighting the expected future rates
of return by the target asset allocation percentages.
The target allocation and best estimates of geometric real rates of return for each major
asset class are summarized in the following table:
Asset Class Target Allocation Long-Term Expected
Real Rate of Return
Domestic Stocks 45% 5.50%
International Stocks 15% 6.00%
Bonds 18% 1.45%
Alternative Assets 20% 6.40%
Cash 2% 0.50%
Total 100%
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
76
4. Other Information (Continued)
D. Pension Plans (Continued)
1. Public Employees Retirement Association (PERA) - Defined Benefit (Continued)
E. Discount Rate
The discount rate used to measure the total pension liability in 2016 was 7.50%, a
reduction from the 7.90% used in 2015. The projection of cash flows used to determine
the discount rate assumed that contributions from plan members and employers will be
made at rates set in Minnesota Statutes. Based on these assumptions, the fiduciary net
position of the General Employees Fund was projected to be available to make all
projected future benefit payments of current plan members. Therefore, the long-term
expected rate of return on pension plan investments was applied to all periods of
projected benefit payments to determine the total pension liability.
In the Police and Fire Fund, the fiduciary net position was projected to be available to
make all projected future benefit payments of current plan members through June 30,
2056. Beginning in fiscal year ended June 30, 2057, when projected benefit payments
exceed the fund’s projected fiduciary net position, benefit payments were discounted at
the municipal bond rate of 2.85% based on an index of 20-year general obligation bonds
with an average AA credit rating at the measurement date. An equivalent single discount
rate of 5.60% was determined that produced approximately the same present value of
projected benefits when applied to all years of projected benefits as the present value
of projected benefits using 7.50% applied to all years of projected benefits through the
point of asset depletion and 2.85% after.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
77
4. Other Information (Continued)
D. Pension Plans (Continued)
1. Public Employees Retirement Association (PERA) - Defined Benefit (Continued)
F. Pension Liability Sensitivity
The following presents the City's proportionate share of the net pension liability for all
plans it participates in, calculated using the discount rate disclosed in the preceding
paragraph, as well as what the City's proportionate share of the net pension liability
would be if it were calculated using a discount rate 1 percentage point lower or 1
percentage point higher than the current discount rate:
1% Higher 6.50% 1,833,604$ 4.60% 505,612$
Current Discount Rate 7.50% 1,291,001 5.60% 361,186
1% Lower 8.50% 844,044 6.60% 243,178
General Employees Fund Police and Fire Fund
Sensitivity of Net Pension Liability at Current Single Discount Rate
G. Pension Plan Fiduciary Net Position
Detailed information about each pension plan's fiduciary net position is available in a
separately-issued PERA financial report that includes financial statements and required
supplementary information. That report may be obtained on the Internet at
www.mnpera.org.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
78
4. Other Information (Continued)
D. Pension Plans (Continued)
2. Lake Elmo Firefighter's Relief Association
A. Plan Description
The Lake Elmo Firefighter's Relief Association administers a single-employer defined
benefit pension plan (FRA plan) available to volunteer firefighters. As of December 31,
2016, the plan covered 19 active firefighters and 5 vested terminated firefighters whose
pension benefits are deferred. The plan was established and is administered in
accordance with Minnesota Statutes, Chapters 69 and 424A. The December 31, 2016
information is the latest reported for this Plan.
B. Benefits Provided
Volunteer firefighters for the City are members of the Lake Elmo Firefighter's Relief
Association. Association members are eligible to receive a lump sum benefit after 20
years of service with a minimum retirement age of 50. Currently retirees receive a
benefit of $3,400 for every year of service. These benefit provisions and all other
requirements are consistent with State statutes. Volunteers of the fire department are
not required to contribute to the relief association. Members with 10 years of service
receive partial vesting at 60% of the 20-year rate and 4% added for every one year of
service beyond ten years up to 20 years.
C. Contributions
The Plan is funded by fire state aid, investment earnings and, if necessary, employer
contributions as specified in Minnesota statutes, and voluntary City contributions. The
State of Minnesota contributed $59,136 in state aid to the plan on behalf of the
Association for the year ended December 31, 2016. This contribution was recorded as
a revenue and an expenditure in the City's general fund. The City levies property taxes
for the benefit of the Association and passes through state aids allocated to the plan, all
in accordance with State statutes. During 2016, at the Association's direction, the City
did not levy any property taxes to be paid to the Association.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
79
4. Other Information (Continued)
D. Pension Plans (Continued)
2. Lake Elmo Firefighter's Relief Association (Continued)
D. Pension Costs
At December 31, 2016, the City reported a net pension asset of $456,915 for the plan.
The net pension asset was measured as of December 31, 2016. The total pension
liability used to calculate the net pension asset in accordance with GASB 68 was
determined by applying an actuarial formula to specific census data certified by the fire
department as of December 31, 2016. The following table presents the changes in net
pension liability during the year.
Total
Pension
Liability (a)
Plan
Fiduciary Net
Position (b)
Net Pension
Liability
(Asset) (a-b)
Beginning Balance 12/31/15 588,689$ 963,628$ (374,939)$
Changes for the Year
Service cost 27,579 27,579
Interest on pension liability 36,976 36,976
Assumption changes 11,690 11,690
Net investment income (46,403) 70,101 (116,504)
Contributions (employer)
Contributions (state) 59,136 (59,136)
Benefit payouts
Administrative expenses (17,419) 17,419
Net Changes 29,842 111,818 (81,976)
Balance End of Year 12/31/16 618,531$ 1,075,446$ (456,915)$
For the year ended December 31, 2016, the City did not recognize pension expense
related to the FRA plan.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
80
4. Other Information (Continued)
D. Pension Plans (Continued)
2. Lake Elmo Firefighter's Relief Association (Continued)
D. Pension Costs (continued)
At December 31, 2016, the Association reported deferred inflows of resources and
deferred outflows of resources related to pensions from the following sources:
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Difference between projected and actual
investment earnings 106,145$ $
Total 106,145$ $
Amounts reported as deferred outflows and inflows of resources related to pensions will be
recognized in pension expense as follows:
Year ending June 30:
Pension Expense
Amount
2017 27,831$
2018 27,831
2019 27,830
2020 22,653
E. Actuarial Assumptions
The total pension liability at December 31, 2016 was determined using the entry age
normal actuarial cost method and the following actuarial assumptions:
Retirement eligibility at the later of age 50 or 20 years of service
Investment rate of return of 5.50%
Inflation rate 4.0%
During 2016, the investment rate of return decreased from 6.00% to 5.50%.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
81
4. Other Information (Continued)
D. Pension Plans (Continued)
2. Lake Elmo Firefighter's Relief Association (Continued)
F. Discount Rate
The discount rate used to measure the total pension liability was 5.50%. The projection
of cash flows used to determine the discount rate assumed that contributions to the FRA
plan will be made as specified in statute. Based on that assumption and considering
the funding ratio of the plan, the fiduciary net position was projected to be available to
make all projected future benefit payments of current active and inactive members.
Therefore, the long-term expected rate of return on pension plan investments was
applied to all periods of projected benefit payments to determine the total pension
liability.
G. Pension Liability Sensitivity
The following presents the City's net pension asset for the Association's plan, calculated
using the discount rate disclosed in the preceding paragraph, as well as what the City's
net pension asset would be if it were calculated using a discount rate 1% lower or 1%
higher than the current discount rate:
1% Decrease in
Discount Rate
(4.50%)
Discount Rate
(5.50%)
1% Increase in
Discount Rate
(6.50%)
Net pension liability (asset) (432,549)$ (456,915)$ (479,967)$
H. Plan Investments
1. Investment Policy
All investments undertaken by the plan are governed by the prudent person rule and
other standards codified in Minnesota Statutes, Chapter 11A and Chapter 356A.
Within the requirements defined by state law, the Plan establishes investment policy
for all funds under its control. These investment policies are tailored to the particular
needs of each fund and specify investment objectives, risk tolerance, asset
allocation, investment management structure and specific performance standards.
Studies guide the ongoing management of the funds and are updated periodically.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
82
4. Other Information (Continued)
D. Pension Plans (Continued)
2. Lake Elmo Firefighter's Relief Association (Continued)
2. Asset Allocation
The long-term target asset allocation and long-term expected real rate of return of
the Plan's assets is as follows:
Asset Class
Target
Allocation
Long-Term
Expected Real
Rate of Return
Cash 17.00% 2.25%
Fixed income 28.00% 3.30%
Equities 54.00% 7.50%
Other 1.00% 6.00%
Total 100% 5.50%
The long-term return on assets has been set based on the plan's target investment
allocation along with long-term return expectations by asset class. When there is
sufficient historical evidence of market outperformance, historical average returns
may be considered.
3. Description of significant investment policy changes during the year
The Plan made no significant changes to their investment policy during the year.
I. Pension Plan Fiduciary Net Position
Detailed information about the Lake Elmo Firefighter's Relief Association plan's fiduciary
net position as of December 31, 2016 is available in a separately-issued financial report
that includes financial statements and required supplementary information. That report
may be obtained by contacting the Finance Director for the City of Lake Elmo.
CITY OF LAKE ELMO, MINNESOTA
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
83
5. Implementation of New Accounting Principles
The City adopted the provisions of Governmental Accounting Standards Board Statement No. 72,
Fair Value Measurement and Application. This statement generally requires investments to be
measured at fair value and requires disclosures to be made about fair value measurements
including the level of hierarchy and the valuation techniques utilized by the City.
The City adopted the provisions of Governmental Accounting Standards Board Statement No. 76,
Hierarchy of Generally Accepted Accounting Principles of the State and Local Governments. This
statement established the order and priority of pronouncements and other sources of accounting
and financial reporting guidance that governments should apply. This statement did not impact the
preparation of these financial statements.
The City adopted the provisions of Governmental Accounting Standards Board Statement No. 77,
Tax Abatement Disclosures. This statement requires the disclosure of information related to tax
abatement agreements entered into by the City, such as the financial statement impact, amount of
taxes the City has promised to forego, and commitments made under the agreements.
The City adopted the provisions of Governmental Accounting Standards Board Statement No. 82,
Pension Issues – an Amendment of GASB Statements No. 67, No. 68, No. 73. The objective of
this statement is to improve consistency in the application of pension accounting and financial
reporting requirements by addressing certain issues that have been raised during implementation
of the three standards listed above. One of the significant changes included in this statement
clarifies the presentation of covered payroll in the required supplementary information to reflect the
amount of payroll on which contributions made to the pension plan are based.
6. Subsequent Event
In June 2017, the City issued 2017A General Obligation Bonds in the amount of $9,045,000. The
proceeds of the bonds will be used to finance an improvement project, the purchase of equipment,
a sewer project, a water project, a storm water project, and to pay costs associated with issuance
of the bonds.
CITY OF LAKE ELMO, MINNESOTA
REQUIRED SUPPLEMENTAL INFORMATION
December 31, 2016
This Page Left Blank Intentionally
84
Year Ended
December 31
Statutorily
Required
Contribution
(a)
Contributions
in Relation to
Statutorily
Required
Contribution
(b)
Contribution
Deficiency
(Excess) (a-b)
Covered
Employee
Payroll (d)
Contributions as a
Percentage of
Covered Payroll
(b/d)
2014 73,182$ 73,182$ $ 1,009,407$ 7.2%
2015 70,582 70,582 941,092 7.5%
2016 85,649 85,649 1,141,987 7.5%
2017
2018
2019
2020
2021
2022
2023
Year Ended
December 31
Statutorily
Required
Contribution
(a)
Contributions
in Relation to
Statutorily
Required
Contribution
(b)
Contribution
Deficiency
(Excess) (a-b)
Covered
Employee
Payroll (d)
Contributions as a
Percentage of
Covered Payroll
(b/d)
2014 13,035$ 13,035$ $ 85,195$ 15.3%
2015 14,257 14,257 88,005 16.2%
2016 13,967 13,967 86,216 16.2%
2017
2018
2019
2020
2021
2022
2023
PERA Public Employees Police and Fire Plan
December 31, 2016
CITY OF LAKE ELMO, MINNESOTA
Schedule of City Contributions
PERA General Employees Retirement Plan
December 31, 2016
Schedule of City Contributions
Note: These schedules are intended to provide information for ten years. The City will include that
information as it becomes available.
85
Fiscal Year
Ended June 30
Proportionate
(Percentage) of
Net Pension
Liability (Asset)
Proportionate
Share (Amount) of
the Net Pension
Liability (Asset) (a)
Covered-
Employee
Payroll (b)
Proportionate
Share (Amount) of
the Net Pension
Liability (Asset) as
a Percentage of its
Covered Employee
Payroll (a/b)
Plan Fiduciary
Net Position as a
Percentage of the
Total Pension
Liability
2014 0.0191% 897,222$ 1,009,407$ 88.9% 78.7%
2015 0.0169% 875,846 941,092 93.1% 78.2%
2016 0.0159% 1,291,001 1,141,987 113.0% 68.9%
2017
2018
2019
2020
2021
2022
2023
Fiscal Year
Ended June 30
Proportionate
(Percentage) of
Net Pension
Liability (Asset)
Proportionate
Share (Amount) of
the Net Pension
Liability (Asset) (a)
Covered-
Employee
Payroll (b)
Proportionate
Share (Amount) of
the Net Pension
Liability (Asset) as
a Percentage of its
Covered Employee
Payroll (a/b)
Plan Fiduciary
Net Position as a
Percentage of the
Total Pension
Liability
2014 0.0090% 97,204$ 85,195$ 114.1% 87.1%
2015 0.0090% 102,261 88,005 116.2% 86.6%
2016 0.0090% 361,186 86,216 418.9% 63.9%
2017
2018
2019
2020
2021
2022
2023
PERA Public Employees Police and Fire Plan
December 31, 2016
CITY OF LAKE ELMO, MINNESOTA
Schedule of Proportionate Share of Net Pension Liability
PERA General Employees Retirement Plan
December 31, 2016
Schedule of Proportionate Share of Net Pension Liability
Note: These schedules are intended to provide information for ten years. The City will include that
information as it becomes available.
86
CITY OF LAKE ELMO, MINNESOTA
Schedule of Funding Progress for the Fire Relief Association
December 31, 2016
Actuarial
Valuation Date
Actuarial Accrued
Liability (AAL)
Valuation of Plan
Assets (a)
Actuarial
Valuation of Plan
Assets (b)
Net Pension
Liability (Asset)
(a-b)
12/31/16 618,531$ 1,075,446$ (456,915)$
12/31/15 588,689 963,628 (374,939)
CITY OF LAKE ELMO, MINNESOTA
Schedule of Employer Contributions for the Fire Relief Association
December 31, 2016
2016 2015
Actuarially determined contributions $ $
Actual contributions paid
Contributions deficiency (excess) $ $
87
CITY OF LAKE ELMO, MINNESOTA
SCHEDULE OF FUNDING PROGRESS - OTHER POST EMPLOYMENT BENEFITS
For the Year Ended December 31, 2016
Actuarial valuations are provided every one to three years unless events occur (e.g. plan changes,
layoffs, etc.) that would materially impact results. See Note 4C in the Notes to Financial Statements
for more details on this schedule.
Actuarial
Valuation
Date
Actuarial
Value of
Assets
Actuarial
Accrued
Liability
Unfunded
Actuarial
Accrued
Liability
Funded
Ratio
Covered
Payroll
UAAL as a
Percentage of
Covered Payroll
1/1/2009 $ 112,761$ 112,761$ 0% 892,528$ 12.63%
1/1/2012 101,981 101,981 0% 932,540 10.94%
1/1/2013 293,220 293,220 0% 913,884 32.09%
1/1/2014 204,437 204,437 0% 1,022,592 19.99%
1/1/2015 186,284 186,284 0% 1,041,665 17.88%
1/1/2016 188,502 188,502 0% 1,417,483 13.30%
CITY OF LAKE ELMO, MINNESOTA
COMBINING AND INDIVIDUAL
FUND STATEMENTS AND SCHEDULES
December 31, 2016
88
Special
Revenue
Capital
Projects Total
ASSETS
Cash and investments 249,780$ 1,392,769$ 1,642,549$
TOTAL ASSETS 249,780$ 1,392,769$ 1,642,549$
LIABILITIES AND FUND BALANCE
LIABILITIES
Accounts payable 71,225$ $ 71,225$
Accrued liabilities 3,480 3,480
Due to other funds 1,144 56,760 57,904
Advances from other funds 405,398 405,398
Escrow deposits payable 75,000 75,000
Total liabilities 75,849 537,158 613,007
FUND BALANCE (DEFICIT)
Nonspendable
Assigned 174,540 1,261,054 1,435,594
Unassigned (609) (405,443) (406,052)
Total Fund Balance (Deficit) 173,931 855,611 1,029,542
TOTAL LIABILITIES AND FUND BALANCE 249,780$ 1,392,769$ 1,642,549$
CITY OF LAKE ELMO, MINNESOTA
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
December 31, 2016
89
Special
Revenue
Capital
Projects Total
REVENUES
Taxes 256,957$ $ 256,957$
Dedication fees 171,708 171,708
Refunds and reimbursements 21,390 21,390
Investment earnings 944 6,358 7,302
Miscellaneous revenue 13,586 13,586
TOTAL REVENUES 271,487 199,456 470,943
EXPENDITURES
Current
Culture and recreation 331,901 331,901
Capital Outlay
Culture and recreation 146,441 146,441
TOTAL EXPENDITURES 331,901 146,441 478,342
Net change in fund balances (60,414) 53,015 (7,399)
FUND BALANCES, Beginning 234,345 802,596 1,036,941
FUND BALANCES, Ending 173,931$ 855,611$ 1,029,542$
CITY OF LAKE ELMO, MINNESOTA
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
For the Year Ended December 31, 2016
90
City Events
(204) Library (206)Total
ASSETS
Cash and investments 535$ 249,245$ 249,780$
TOTAL ASSETS 535$ 249,245$ 249,780$
LIABILITIES AND FUND BALANCE
LIABILITIES
Accounts payable $ 71,225$ 71,225$
Due to other funds 1,144 1,144
Accrued liabilities 3,480 3,480
Total liabilities 1,144 74,705 75,849
FUND BALANCE (DEFICIT)
Assigned 174,540 174,540
Unassigned (609) (609)
Total fund balance (deficit) (609) 174,540 173,931
TOTAL LIABILITIES AND
FUND BALANCE (DEFICIT)535$ 249,245$ 249,780$
CITY OF LAKE ELMO, MINNESOTA
COMBINING BALANCE SHEET
NONMAJOR SPECIAL REVENUE FUNDS
December 31, 2016
91
City Events
(204) Library (206)Total
REVENUES
Taxes $ 256,957$ 256,957$
Investment earnings 3 941 944
Miscellaneous revenue 532 13,054 13,586
TOTAL REVENUES 535 270,952 271,487
EXPENDITURES
Current
Culture and recreation 331,901 331,901
Net change in fund balances 535 (60,949) (60,414)
FUND BALANCES, Beginning (1,144) 235,489 234,345
FUND BALANCES (DEFICIT), Ending (609)$ 174,540$ 173,931$
CITY OF LAKE ELMO, MINNESOTA
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
NONMAJOR SPECIAL REVENUE FUNDS
For the Year Ended December 31, 2016
92
Park
Dedication
(404)
City Facilities
(411)
Village Project
(413)
ASSETS
Cash and investments 980,041$ 272,924$ 61,612$
TOTAL ASSETS 980,041$ 272,924$ 61,612$
LIABILITIES AND FUND BALANCE
LIABILITIES
Due to other funds $ $ 56,760$
Advances from other funds 405,398
Escrow deposits payable
Total liabilities 462,158
FUND BALANCE (DEFICIT)
Assigned 980,041 272,924
Unassigned (400,546)
Total fund balance (deficit) 980,041 272,924 (400,546)
TOTAL LIABILITIES AND FUND BALANCE 980,041$ 272,924$ 61,612$
CITY OF LAKE ELMO, MINNESOTA
COMBINING BALANCE SHEET
NONMAJOR CAPITAL PROJECT FUNDS
December 31, 2016
93
Manning
Avenue/Hwy
36 (414)
Washington
County
Downtown
Project (422)Total
70,103$ 8,089$ 1,392,769$
70,103$ 8,089$ 1,392,769$
$ $ 56,760$
405,398
75,000 75,000
75,000 537,158
8,089 1,261,054
(4,897) (405,443)
(4,897) 8,089 855,611
70,103$ 8,089$ 1,392,769$
94
Park
Dedication
(404)
City Facilities
(411)
Village Project
(413)
REVENUES
Dedication fees 171,708$ $ $
Refunds and reimbursements 21,390
Investment earnings (loss) 4,509 1,255 233
TOTAL REVENUES 176,217 1,255 21,623
EXPENDITURES
Capital Outlay
Culture and recreation 146,441
Net change in fund balances 29,776 1,255 21,623
FUND BALANCES (DEFICIT), Beginning 950,265 271,669 (422,169)
FUND BALANCES (DEFICIT), Ending 980,041$ 272,924$ (400,546)$
CITY OF LAKE ELMO, MINNESOTA
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
NONMAJOR CAPITAL PROJECT FUNDS
For the Year Ended December 31, 2016
95
Manning
Avenue/Hwy
36 (414)
Washington
County
Downtown
Project (422)Total
$ $ 171,708$
21,390
323 38 6,358
323 38 199,456
146,441
323 38 53,015
(5,220) 8,051 802,596
(4,897)$ 8,089$ 855,611$
96
Radio
Replacement
(701)
IT
Replacement
(702)
FFE
Replacement
(703) Total
ASSETS
Noncurrent Assets
Property and Equipment
Machinery and equipment 168,854$ 95,355$ 390,483$ 654,692$
Less: Accumulated depreciation 79,506 77,095 325,720 482,321
Net Property and Equipment 89,348 18,260 64,763 172,371
TOTAL ASSETS 89,348$ 18,260$ 64,763$ 172,371$
LIABILITIES AND NET POSITION
Current Liabilities
Due to other funds 41,740$ $ 76,081$ 117,821$
Net Position
Net investment in capital assets 89,348 18,260 64,763 172,371
Unrestricted (41,740) (76,081) (117,821)
Total Net Position 47,608 18,260 (11,318) 54,550
TOTAL LIABILITIES AND
NET POSITION 89,348$ 18,260$ 64,763$ 172,371$
CITY OF LAKE ELMO, MINNESOTA
COMBINING STATEMENT OF NET POSITION
INTERNAL SERVICE FUNDS
December 31, 2016
97
Radio
Replacement
(701)
IT
Replacement
(702)
FFE
Replacement
(703) Total
Operating Expenses
Depreciation 9,471$ 4,654$ 10,505$ 24,630$
Net (Loss) (9,471) (4,654) (10,505) (24,630)
Net Position, Beginning of Year 57,079 22,914 (813) 79,180
Net Position, End of Year 47,608$ 18,260$ (11,318)$ 54,550$
CITY OF LAKE ELMO, MINNESOTA
COMBINING STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN FUND NET POSITION
INTERNAL SERVICE FUNDS
For the Year Ended December 31, 2016
98
Radio
Replacement
(701)
IT
Replacement
(702)
FFE
Replacement
(703) Total
Cash Flows From Noncapital Financing Activities
Increase in due to other funds 41,740$ $ $ 41,740$
Cash Flows From Capital and Related Financing Activities
Acquisition of capital assets (69,003) (69,003)
Net Increase (Decrease) in Cash and Cash Equivalents (27,263) (27,263)
Cash and Cash Equivalents, Beginning of Year 27,263 27,263
Cash and Cash Equivalents, End of Year $ $ $ $
RECONCILIATION OF OPERATING INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES
Operating (loss) (9,471)$ (4,654)$ (10,505)$ (24,630)$
Adjustments to reconcile operating income to
net cash provided by operating activities
Depreciation 9,471 4,654 10,505 24,630
Net Cash Provided By (Used In) Operating Activities $ $ $ $
CITY OF LAKE ELMO, MINNESOTA
COMBINING STATEMENT OF CASH FLOWS
INTERNAL SERVICE FUNDS
For the Year Ended December 31, 2016
This Page Left Blank Intentionally
99
2002 GO
Improvement
Bonds (312)
2006A GO
Equipment
Certificates
(314)
2009A GO
Refunding
Bonds (315)
2009B GO
Improvement
Bonds (316)
2010A GO
Improvement
Bonds (317)
ASSETS
Cash and investments 475$ 29,544$ $ 106,002$ 114,650$
Receivables (Net of allowance for
uncollectibles)
Special assessments 23,665 40,400
Due from other governmental units 121
TOTAL ASSETS 475$ 29,544$ $ 129,788$ 155,050$
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCE
LIABILITIES
Accounts payable $ $ $ $ $
Due to other funds 1,002
Total liabilities 1,002
DEFERRED INFLOWS OF RESOURCES
Unavailable revenue:
Special assessments 23,665 40,400
Total deferred inflows of resources 23,665 40,400
FUND BALANCE (DEFICIT)
Restricted 475 29,544 106,123 114,650
Unassigned (1,002)
Total fund balance (deficit) 475 29,544 (1,002) 106,123 114,650
TOTAL LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCE 475$ 29,544$ $ 129,788$ 155,050$
CITY OF LAKE ELMO, MINNESOTA
COMBINING BALANCE SHEET
DEBT SERVICE FUNDS
December 31, 2016
100
2010B GO
CIP Bonds
(318)
2011A GO
Improvement
Bonds (319)
2012B GO
Improvement
Bonds (321)
2013A GO
Improvement
Bonds (322)
2014A GO
Improvement
Bonds (323)
2015A GO
Improvement
Bonds (324)
2016A GO
Improvement
Bonds (326)Total
126,551$ 301,350$ 6,061$ 1,597,733$ 762,457$ 41,149$ 240,912$ 3,326,884$
39,920 119,700 28,560 565,065 371,860 1,189,170
4,713 4,834
126,551$ 341,270$ 125,761$ 1,626,293$ 1,332,235$ 41,149$ 612,772$ 4,520,888$
$ $ $ $ $ $ $ $
17,176 77,427 95,605
17,176 77,427 95,605
39,920 119,700 28,560 565,065 371,860 1,189,170
39,920 119,700 28,560 565,065 371,860 1,189,170
126,551 301,350 1,520,306 767,170 41,149 240,912 3,248,230
(11,115) (12,117)
126,551 301,350 (11,115) 1,520,306 767,170 41,149 240,912 3,236,113
126,551$ 341,270$ 125,761$ 1,626,293$ 1,332,235$ 41,149$ 612,772$ 4,520,888$
101
2002 GO
Improvement
Bonds (312)
2006A GO
Equipment
Certificates
(314)
2009A GO
Refunding
Bonds (315)
2009B GO
Improvement
Bonds (316)
2010A GO
Improvement
Bonds (317)
REVENUES
Taxes $ $ $ 49,598$ 59,043$
Intergovernmental 72,100
Special assessments 7,463 10,507
Investment earnings 2 136 489 528
TOTAL REVENUES 2 136 72,100 57,550 70,078
EXPENDITURES
Debt Service
Principal 70,000 60,000 70,000
Interest and other charges 5,177 8,163 9,550
TOTAL EXPENDITURES 75,177 68,163 79,550
Excess (deficiency) of revenues
over (under) expenditures 2 136 (3,077) (10,613) (9,472)
OTHER FINANCING SOURCES (USES)
Transfers
Net change in fund balances 2 136 (3,077) (10,613) (9,472)
FUND BALANCES (DEFICIT), Beginning 473 29,408 2,075 116,736 124,122
FUND BALANCES (DEFICIT), Ending 475$ 29,544$ (1,002)$ 106,123$ 114,650$
CITY OF LAKE ELMO, MINNESOTA
COMBINING SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
DEBT SERVICE FUNDS
For the Year Ended December 31, 2016
102
2010B GO
CIP Bonds
(318)
2011A GO
Improvement
Bonds (319)
2012B GO
Improvement
Bonds (321)
2013A GO
Improvement
Bonds (322)
2014A GO
Improvement
Bonds (323)
2015A GO
Improvement
Bonds (324)
2016A GO
Improvement
Bonds (326)Total
205,860$ 75,485$ 62,926$ $ 211,628$ $ $ 664,540$
72,100
8,175 23,904 483,548 123,922 239,804 897,323
583 1,386 28 7,351 3,509 189 1,108 15,309
206,443 85,046 86,858 490,899 339,059 189 240,912 1,649,272
150,000 85,000 85,000 105,000 180,000 805,000
42,603 10,296 9,751 38,105 68,838 33,289 225,772
192,603 95,296 94,751 143,105 248,838 33,289 1,030,772
13,840 (10,250) (7,893) 347,794 90,221 (33,100) 240,912 618,500
143,105 143,105
13,840 (10,250) (7,893) 490,899 90,221 (33,100) 240,912 761,605
112,711 311,600 (3,222) 1,029,407 676,949 74,249 2,474,508
126,551$ 301,350$ (11,115)$ 1,520,306$ 767,170$ 41,149$ 240,912$ 3,236,113$
103
Variance with
Final Budget
Favorable
Original Final Actual (Unfavorable)
REVENUES
Investment earnings $ $ 3$ 3$
Miscellaneous revenue 532 532
TOTAL REVENUES 535 535
EXPENDITURES
Current
Culture and recreation
Net change in fund balances 535 535
FUND BALANCES, Beginning (1,144) (1,144) (1,144)
FUND BALANCES, Ending (1,144)$ (1,144)$ (609)$ 535$
Note: The City adopted a $0 activity budget in this fund for the year ended December 31, 2016.
Budgeted Amounts
CITY OF LAKE ELMO, MINNESOTA
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES - BUDGET AND ACTUAL
CITY EVENTS SPECIAL REVENUE FUND
For the Year Ended December 31, 2016
104
Variance with
Final Budget
Favorable
Original Final Actual (Unfavorable)
REVENUES
Taxes 256,957$ 256,957$ 256,957$ $
Investment earnings 941 941
Miscellaneous revenue 13,054 13,054
TOTAL REVENUES 256,957 256,957 270,952 13,995
EXPENDITURES
Current
Culture and recreation 256,957 256,957 331,901 (74,944)
Net change in fund balances (60,949) (60,949)
FUND BALANCES, Beginning 235,489 235,489 235,489
FUND BALANCES, Ending 235,489$ 235,489$ 174,540$ (60,949)$
Budgeted Amounts
CITY OF LAKE ELMO, MINNESOTA
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES - BUDGET AND ACTUAL
LIBRARY SPECIAL REVENUE FUND
For the Year Ended December 31, 2016
105
Balance Balance
January 1 Additions Deletions December 31
ESCROW
ASSETS
Cash and investments 1,827,298$ 2,062,165$ 1,494,809$ 2,394,654$
LIABILITIES
Accounts payable 99,952$ 1,403,507$ 1,438,647$ 64,812$
Deposits payable 1,727,346 2,155,295 1,552,799 2,329,842
TOTAL LIABILITIES 1,827,298$ 3,558,802$ 2,991,446$ 2,394,654$
YELLOW RIBBON
ASSETS
Cash and investments (128)$ $ $ (128)$
Accounts receivable 128 128
TOTAL ASSETS $ $ $ $
TOTAL AGENCY FUNDS
ASSETS
Cash and investments 1,827,170$ 2,062,165$ 1,494,809$ 2,394,526$
Accounts receivable 128 128
TOTAL ASSETS 1,827,298$ 2,062,165$ 1,494,809$ 2,394,654$
LIABILITIES
Accounts payable 99,952$ 1,403,507$ 1,438,647$ 64,812$
Deposits payable 1,727,346 2,155,295 1,552,799 2,329,842
TOTAL LIABILITIES 1,827,298$ 3,558,802$ 2,991,446$ 2,394,654$
CITY OF LAKE ELMO, MINNESOTA
COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
AGENCY FUNDS
For the Year Ended December 31, 2016
106
Total (1)
SOURCES 3,432,302$
USES**
Inwood Avenue trunk watermain construction 953,584$
Inwood Avenue booster station construction 775,000
Inwood Avenue water tower construction 1,703,718
TOTAL USES 3,432,302$
(1) Redevelopment Grant Program SPAP-14-0007-P-FY14
** Amounts expended for grant purposes are recorded under the full accrual method in the
proprietary funds and therefore were recorded as a noncurrent asset (property and equipment)
rather than current period expenses.
CITY OF LAKE ELMO, MINNESOTA
REDEVELOPMENT GRANT PROGRAM
Supplemental Schedule of Sources and Uses
For the Year Ended December 31, 2016
This Page Left Blank Intentionally
CITY OF LAKE ELMO, MINNESOTA
STATISTICAL SECTION (UNAUDITED)
December 31, 2016
This part of the City's comprehensive annual financial report presents detailed information as a
context for understanding what the information in the financial statements, note disclosures and
required supplementary information says about the City's overall financial health.
Content Page
Financial Trends
These schedules contain trend information to help the reader understand how
the City's financial performance and well-being have changed over time. 107
Revenue Capacity
These schedules contain information to help the reader assess the City's
most significant local revenue source, the property tax. 117
Debt Capacity
These schedules present information to help the reader assess the
affordability of the City's current levels of outstanding debt and the City's
ability to issue additional debt in the future. 124
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the
reader understand the environment within which the City's financial activities
take place. 132
Operating Information
These schedules contain service and infrastructure data to help the reader
understand how the information in the City's financial report relates to the
services the City provides and the activities it performs. 134
Sources: Unless otherwise noted, the information in these schedules is derived from the
comprehensive annual financial reports for the relevant year. The City implemented GASB
Statement 34 in 2004; schedules presenting government-wide information include information
beginning in that year.
107
CITY OF LAKE ELMO, MINNESOTA
NET POSITION BY COMPONENT
LAST TEN FISCAL YEARS
(Accrual Basis of Accounting)
2016 2015 2014 2013
Net investment in capital assets 9,032,535$ 8,723,329$ 7,957,840$ 9,056,353$
Restricted 4,704,133 3,446,142 1,106,200 1,225,849
Unrestricted 4,136,292 3,942,646 5,405,920 4,593,463
Total governmental activities net position 17,872,960$ 16,112,117$ 14,469,960$ 14,875,665$
Business-type activities
Net investment in capital assets 12,506,474$ 10,170,351$ 10,567,418$ 6,855,807$
Restricted 1,473,164 1,876,119 2,387,312 2,612,569$
Unrestricted 6,400,375 3,577,285 1,100,422 1,846,681
Total business-type activities net position 20,380,013$ 15,623,755$ 14,055,152$ 11,315,057$
Primary government
Net investment in capital assets 21,539,009$ 18,893,680$ 18,525,258$ 15,912,160$
Restricted 6,177,297 5,322,261 3,493,512 3,838,418
Unrestricted 10,536,667 7,519,931 6,506,342 6,440,144
Total primary government net position 38,252,973$ 31,735,872$ 28,525,112$ 26,190,722$
NOTE: The City adopted GASB Statement No. 65 in 2013. Amounts in this schedule prior to 2012 have not been
restated for GASB Statement No. 65.
The City adopted GASB Statements No. 68 and 71 in 2015. Amounts in this schedule prior to 2015 have not been
restated for GASB Statements No. 68 and 71.
Governmental activities
Fiscal Year
108
Schedule 1
201220112010200920082007
8,782,840$ 8,553,984$ 8,368,479$ 7,983,822$ 7,151,543$ 5,648,702$
4,205,247 2,664,689 2,057,467 1,399,968 718,617 711,966
918,996 2,555,596 3,439,106 3,824,156 4,698,858 5,139,270
13,907,083$ 13,774,269$ 13,865,052$ 13,207,946$ 12,569,018$ 11,499,938$
6,788,377$ 6,422,782$ 6,713,292$ 6,644,334$ 6,181,055$ 5,617,960$
39,153$
1,105,847 1,449,340 1,193,509 1,056,968 951,793 1,080,666
7,933,377$ 7,872,122$ 7,906,801$ 7,701,302$ 7,132,848$ 6,698,626$
15,571,217$ 14,976,766$ 15,081,771$ 14,628,156$ 13,332,598$ 11,266,662$
4,244,400 2,664,689 2,057,467 1,399,968 718,617 711,966
2,024,843 4,004,936 4,632,615 4,881,124 5,650,651 6,219,936
21,840,460$ 21,646,391$ 21,771,853$ 20,909,248$ 19,701,866$ 18,198,564$
109
CITY OF LAKE ELMO, MINNESOTA
CHANGES IN NET POSITION
LAST TEN FISCAL YEARS
(Accrual Basis of Accounting)
2016 2015 2014 2013
Expenses
Governmental activities:
General government 1,358,370$ 1,134,132$ 1,072,888$ 1,103,337$
Public safety 1,308,360 1,344,282 1,530,609 1,277,798
Public works 1,698,566 1,377,969 1,032,426 1,273,977
Culture and recreation 660,947 639,006 448,361 424,687
Interest on long-term debt 178,266 215,611 165,028 133,694
Total governmental activities expenses 5,204,509 4,711,000 4,249,312 4,213,493
Business-Type activities:
Water 1,409,832 1,363,043 1,069,511 958,870
Sewer 380,650 250,866 353,438 119,370
Storm sewer 150,302 103,536 149,887 86,989
Total business-type activities expenses 1,940,784 1,717,445 1,572,836 1,165,229
Total primary government expenses 7,145,293$ 6,428,445$ 5,822,148$ 5,378,722$
Program Revenues
Governmental activities:
Charges for services:
General government 51,009$ 42,706$ 45,161$ 32,778$
Public safety 1,752,522 866,708 496,916 414,472
Public works 3,615 2,647
Culture and recreation 26,214 10,753 17,000
Operating grants and contributions 235,214 249,094 204,462 208,276
Capital grants and contributions 1,452,469 2,038,940 557,601 1,364,622
Total governmental activities program revenues 3,491,214 3,227,277 1,314,893 2,039,795
Business-type activities:
Charges for services:
Water 1,801,228 1,850,240 1,291,091 596,421
Sewer 1,315,948 1,523,067 741,054 53,142
Storm sewer 213,233 229,252 214,915 191,087
Operating grants and contributions
Capital grants and contributions 3,464,567 1,159,222 3,781,528
Total business-type activities program revenues 6,794,976 3,602,559 3,406,282 4,622,178
Total primary government program revenues 10,286,190$ 6,829,836$ 4,721,175$ 6,661,973$
Fiscal Year
110
Schedule 2
2012 2011 2010 2009 2008 2007
1,093,204$ 1,036,038$ 980,456$ 971,677$ 1,168,625$ 914,212$
1,302,857 1,107,050 1,171,158 1,125,464 1,002,408 956,649
891,169 1,008,686 1,135,351 872,045 868,804 1,247,398
362,432 247,845 239,389 248,856 228,393 333,164
316,039 266,730 222,404 218,319 237,753 207,648
3,965,701 3,666,349 3,748,758 3,436,361 3,505,983 3,659,071
872,786 845,474 898,319 857,014 849,018 735,499
53,903 73,797 61,513 59,243 63,400 125,773
73,590 142,517 151,384 140,365 123,902 78,807
1,000,279 1,061,788 1,111,216 1,056,622 1,036,320 940,079
4,965,980$ 4,728,137$ 4,859,974$ 4,492,983$ 4,542,303$ 4,599,150$
48,476$ 22,058$ 18,296$ 15,631$ 19,430$ 28,890$
379,557 283,813 320,242 270,653 295,353 365,327
3,256 3,058 3,425 6,584 3,833 18,573
9,341 10,800 61,274
160,060 184,476 168,491 174,433 140,176 94,185
160,444 222,488 1,090,419 798,687 1,345,803 1,371,489
761,134 715,893 1,611,673 1,265,988 1,804,595 1,939,738
699,159 575,534 562,585 479,430 467,336 471,226
65,737 53,012 48,508 45,146 44,568 99,581
171,229 235,252 185,425 149,407 134,674 138,092
17,000 32,721 30,100
115,127 75,885 418,400 776,473 684,400 298,928
1,051,252 956,683 1,247,639 1,480,556 1,330,978 1,007,827
1,812,386$ 1,672,576$ 2,859,312$ 2,746,544$ 3,135,573$ 2,947,565$
111
CITY OF LAKE ELMO, MINNESOTA
CHANGES IN NET POSITION
LAST TEN FISCAL YEARS
(Accrual Basis of Accounting)
2016 2015 2014 2013
Net (Expense) Revenue
Governmental Activities (1,713,295)$ (1,483,723)$ (2,934,419)$ (2,173,698)$
Business-type activities 4,854,192 1,885,114 1,833,446 3,456,949
Total primary government net revenue 3,140,897$ 401,391$ (1,100,973)$ 1,283,251$
General Revenues and Other Changes
In Net Position
Governmental activities:
General property taxes 3,226,739$ 3,204,119$ 3,200,291$ 3,231,609$
Grants and contributions not restricted
to specific programs 8,584 2,749 2,749 2,749
Interest income 43,228 46,589 87,586 35,259
Miscellaneous 52,479 73,738 125,400 1,833
Gain on sale of capital assets 8,979
Transfers 143,105 220,842 (887,312)
Total governmental activities 3,474,135 3,548,037 2,528,714 3,280,429
Business-type activities:
Grants and contributions not restricted
to specific programs 748
Interest income 44,423 39,757 19,337 30,346
Transfers (143,105) (220,842) 887,312
Total business-type activities (97,934) (181,085) 906,649 30,346
Total primary government 3,376,201$ 3,366,952$ 3,435,363$ 3,310,775$
Change in Net Position
Governmental activities 1,760,840$ 2,064,314$ (405,705)$ 1,106,731$
Business-type activities 4,756,258 1,704,029 2,740,095 3,487,295
Total primary government 6,517,098$ 3,768,343$ 2,334,390$ 4,594,026$
Fiscal Year
112
Schedule 2
(continued)
2012 2011 2010 2009 2008 2007
(3,204,567)$ (2,950,456)$ (2,137,085)$ (2,170,373)$ (1,701,388)$ (1,719,333)$
50,973 (105,105) 136,423 423,934 294,658 67,748
(3,153,594)$ (3,055,561)$ (2,000,662)$ (1,746,439)$ (1,406,730)$ (1,651,585)$
3,183,078$ 2,793,776$ 2,711,067$ 2,718,691$ 2,568,705$ 2,424,782$
10,628 9,771 8,764 57,390 46,154
111,705 94,501 113,989 160,679 209,539 335,578
42,599 20,405 17,311 41,827 50,865 33,204
8,517
(59,637) (57,947) (129,177) (116,031) (424,940)
3,337,382 2,859,673 2,794,191 2,809,301 2,770,468 2,414,778
10,282 10,789 11,129 15,343 23,533 94,325
59,637 57,947 129,177 116,031 424,940
10,282 70,426 69,076 144,520 139,564 519,265
3,347,664$ 2,930,099$ 2,863,267$ 2,953,821$ 2,910,032$ 2,934,043$
132,815$ (90,783)$ 657,106$ 638,928$ 1,069,080$ 695,445$
61,255 (34,679) 205,499 568,454 434,222 587,013
194,070$ (125,462)$ 862,605$ 1,207,382$ 1,503,302$ 1,282,458$
113
CITY OF LAKE ELMO, MINNESOTA
FUND BALANCES, GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(Modified Accrual Basis of Accounting)
2016 2015 2014 2013 2012
General fund
Reserved $ $ $ $ $
Unreserved
Nonspendable 409,222 432,306 638,963 859,072 1,024,433
Committed 200,000
Unassigned 3,279,815 2,754,976 2,542,038 2,318,310 2,414,692
Total general fund 3,889,037 3,187,282 3,181,001 3,177,382 3,439,125
All other
governmental funds
Reserved
Unreserved
Nonspendable 3,908
Restricted 3,248,230 2,477,730 717,781 743,976 3,959,111
Committed -
Assigned 1,504,656 1,768,742 2,943,525 2,252,931 1,244,900
Unassigned (418,169) (431,755) (693,904) (885,360) (1,670,915)
Total all other
governmental funds 4,334,717 3,818,625 2,967,402 2,111,547 3,533,096
Total governmental funds 8,223,754$ 7,005,907$ 6,148,403$ 5,288,929$ 6,972,221$
Note: The City implemented GASB Statement No. 54 in 2011, therefore, classifications of fund balance have changed.
114
Schedule 3
2011 2010 2009 2008 2007
$ 1,068,950$ 1,032,570$ 1,015,753$ 1,003,823$
1,617,211 1,403,240 1,395,088 1,251,127
1,206,209
1,707,711
2,913,920 2,686,161 2,435,810 2,410,841 2,254,950
3,605,250 1,422,049 727,673 698,683
504,106 1,077,659 1,976,379 2,554,808
4,691,748
7,114
654,358
(1,353,754)
3,999,466 4,109,356 2,499,708 2,704,052 3,253,491
6,913,386$ 6,795,517$ 4,935,518$ 5,114,893$ 5,508,441$
115
CITY OF LAKE ELMO, MINNESOTA
CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS
LAST FISCAL TEN YEARS
(Modified Accrual Basis of Accounting)
2016 2015 2014 2013 2012
Revenues
Taxes 3,231,674$ 3,222,216$ 3,203,111$ 3,231,609$ 3,221,733$
Licenses and permits 1,713,918 828,494 451,953 374,974 330,819
Intergovernmental 282,874 296,902 413,968 1,704,178 237,254
Charges for services 38,608 35,796 30,192 6,113 5,726
Fines and forfeitures 49,505 48,739 48,647 52,110 58,385
Special assessments 897,323 1,316,239 115,424 180,023 136,150
Dedication fees 171,708 138,158 274,257
Refunds and reimbursements 21,390
Investment earnings 43,228 46,415 87,467 35,127 111,737
Miscellaneous revenue 56,101 99,055 165,319 57,260 87,562
Total Revenues 6,506,329 6,032,014 4,790,338 5,641,394 4,189,366
EXPENDITURES
Current
General government 1,280,259 1,025,320 1,046,906 1,527,732 1,034,712
Public safety 1,262,040 1,203,765 1,198,546 1,174,145 1,109,937
Public works 893,644 686,401 585,071 614,270 446,541
Culture and recreation 500,689 457,749 368,276 301,404 260,404
Unallocated 78,047 69,403
Debt service
Principal 826,219 667,342 585,000 3,348,000 406,000
Interest and other charges 226,159 203,738 135,382 171,148 267,253
Bond issuance costs 16,233 22,873 22,267 7,870 41,828
Capital outlay 3,126,782 2,729,512 2,881,437 1,784,914 1,428,856
Total Expenditures 8,210,072 7,066,103 6,822,885 8,929,483 4,995,531
Excess (deficiency) of revenues
over (under) expenditures (1,703,743) (1,034,089) (2,032,547) (3,288,089) (806,165)
OTHER FINANCING
SOURCES (USES)
Issuance of debt 2,690,000 1,620,000 2,850,000 1,604,797 865,000
Premium on issuance of debt 102,877 32,137 31,520
(Discount) on issuance of debt (14,392) (11,386)
Payment to bond escrow agent
Sale of property 30,000
Transfers in 143,105 220,842 10,501
Transfers out
Total other financing
sources (uses) 2,921,590 1,891,593 2,892,021 1,604,797 865,000
Net change in fund balances 1,217,847$ 857,504$ 859,474$ (1,683,292)$ 58,835$
Debt service as a percentage
of noncapital expenditures 20.60% 19.48% 17.67% 47.79% 18.66%
116
Schedule 4
2011 2010 2009 2008 2007
2,790,773$ 2,737,225$ 2,685,894$ 2,523,332$ 2,416,861$
230,419 261,450 225,166 242,074 315,975
276,638 239,244 288,881 261,743 384,160
14,691 22,416 11,433 15,623 39,163
63,819 68,897 54,052 60,919 57,652
153,536 134,257 73,013 102,929 75,993
94,066 113,033 160,679 209,539 335,578
48,217 84,860 61,533 177,599 1,094,478
3,672,159 3,661,382 3,560,651 3,593,758 4,719,860
1,016,898 921,590 929,960 1,108,737 942,131
996,733 1,064,176 988,082 882,135 984,090
447,629 473,293 459,703 438,591 459,478
168,747 168,971 180,965 154,011 160,940
344,000 313,000 361,000 280,000 334,000
251,385 216,820 229,175 235,450 206,020
34,327 74,580 45,056
1,029,183 1,203,309 998,031 888,382 2,281,938
4,288,902 4,435,739 4,191,972 3,987,306 5,368,597
(616,743) (774,357) (631,321) (393,548) (648,737)
845,000 2,680,000 1,110,000
4,356 17,756
(525,000)
9,190
204,972 314,698 1,466,041 8,500 778,074
(315,360) (364,698) (1,626,041) (8,500) (778,074)
734,612 2,634,356 451,946
117,869$ 1,859,999$ (179,375)$ (393,548)$ (648,737)$
17.43% 15.11% 17.81% 15.42% 14.69%
117
SCHEDULE 5
Total
Taxable Total Adjusted City % of Tax Capacity
Payable Market Real Personal Tax Tax Urban Tax to Total Estimated
Year Value Property Property Capacity Capacity (1) Rate Market Value
2007 $ 1,131,010,100 $ 12,506,910 $ 207,913 $ 12,714,823 $ 12,714,823 19.274 % 0.01
2008 1,146,659,500 12,750,173 203,610 12,953,783 12,953,783 20.553 0.01
2009 1,208,072,300 13,490,182 201,896 13,692,078 13,692,078 19.810 0.01
2010 1,201,213,400 13,394,423 202,299 13,596,722 13,596,722 20.479 0.01
2011 1,142,936,500 12,678,177 221,613 12,899,790 12,899,790 21.832 0.01
2012 1,037,557,100 11,525,623 229,157 11,754,780 11,754,780 27.271 0.01
2013 1,028,011,400 11,392,876 237,584 11,630,460 11,630,460 29.259 0.01
2014 1,046,031,000 11,504,611 238,764 11,743,375 11,743,375 27.761 0.01
2015 1,184,578,800 12,938,515 243,104 13,181,619 13,181,619 23.798 0.01
2016 1,267,841,100 13,386,725 266,218 13,652,943 13,652,943 23.121 0.01
(1) Tax Capacity adjusted for captured tax increment, fiscal disparities, and transmission lines.
NOTE - Valuations are determined as of January 1 of year preceding tax collection year.
The County determines a property's tax capacity by multiplying a property's estimated market value times the property's class rate which is determined
by its use. The total City tax levy divided by the total City tax capacity determines a percentage, the City tax rate, that is applied to each parcel's tax
capacity to determine the tax amount.
Tax Capacity
CITY OF LAKE ELMO, MINNESOTA
TAX CAPACITY AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY
LAST TEN FISCAL YEARS
118
Schedule 6
Operating Debt Total
Tax Service City Special
Fiscal Rate Tax Rate Tax Rate Washington Taxing
Year Urban Urban Urban County Districts
2007 19.274 % % 19.274 % 17.698 - 22.628 % 25.673 % 1.315 - 4.580 % 2.331 % 66.291 - 74.486 %
2008 20.553 20.553 17.404 - 22.691 25.936 1.608 - 4.532 2.367 67.868 - 76.079
2009 17.059 2.751 19.810 17.714 - 24.480 26.371 1.545 - 4.002 2.351 67.791 - 77.014
2010 18.033 2.446 20.479 19.734 - 26.389 27.775 1.511 - 4.153 2.558 72.057 - 81.354
2011 19.448 2.384 21.832 20.300 - 34.330 29.772 1.725 - 4.275 2.664 76.293 - 92.873
2012 23.679 (1) 3.592 27.271 22.333 - 38.360 31.939 2.340 - 4.906 2.909 86.792 - 105.385
2013 23.555 5.704 29.259 22.017 - 37.104 31.548 0.779 - 5.306 4.857 88.460 - 108.074
2014 23.472 4.289 27.761 23.150 - 39.770 30.243 0.761 - 5.066 4.641 86.556 - 107.481
2015 20.121 3.677 23.798 21.120 - 35.860 27.691 0.692 - 4.769 4.183 77.484 - 96.301
2016 18.184 4.937 23.121 19.849 - 35.569 27.860 0.075 - 5.111 4.568 75.473 - 96.229
Source: Washington County Taxation Division
Note: The City's direct property tax rate is determined by dividing the amount of tax levied by the City Council
by the City's total tax capacity.
*Overlapping rates are those of local and county governments that apply to property owners within the City
of Lake Elmo. Not all overlapping rates apply to all City of Lake Elmo property owners. Although the property tax rates
apply to all city property owners, some city properties lie within the geographical boundaries of different
school and watershed districts.
(1) Beginning in 2012, operating tax rate urban includes library levy component
CITY OF LAKE ELMO, MINNESOTA
for Independent
Tax Rates622, 832 and 834
Direct and Ovelapping
Overlapping Rates
PROPERTY TAX RATES AND TAX LEVIES
DIRECT AND OVERLAPPING PROPERTY TAX RATES
LAST TEN FISCAL YEARS
(Percent of Tax Capacity)
Watershed Districts
Range of TotalRange of Tax Rates
forSchool Districts
Range of Tax Rates
City of Lake Elmo
119
SCHEDULE 7
Percentage Percentage
of Total City of Total City
Taxable Tax Taxable Tax
Tax Capacity Tax Capacity
Taxpayers (1) Capacity Rank Value Capacity Rank Value
Xcel Energy 223,288$ 1 1.64 % 177,104$ 3 1.39 %
IRET Properties 205,342 2 1.50 239,610 1 1.88
Dakota Upreit LP 179,262 3 1.31
Bremer Financial Services Inc 169,652 4 1.24 195,538 2 1.53
MHC Cimarron LLC 136,610 5 1.02 134,090 7 1.05
Heart of America 108,150 6 0.79
Tartan Park LLC 100,704 7 0.74
Norman James LLC 64,976 8 0.48
Davis Estates LTD 64,912 9 0.48
Danate Proper Inv I LLC 59,250 10 0.43 61,276 9 0.48
Moline Plow 139,208 5 1.09
United Land LLC 155,494 4 1.22
Lake Elmo Foundation 139,073 6 1.09
United Properties Inv, LLC 58,624 10 0.46
Bri-mar Co In. Etal. 63,518 8 0.50
TOTAL 1,312,146$ 9.63 % 1,363,535$ 10.69 %
(1) Source: Washington County Taxation Division
2007
CITY OF LAKE ELMO, MINNESOTA
PRINCIPAL PROPERTY TAXPAYERS
CURRENT YEAR AND NINE YEARS AGO
2016
This Page Left Blank Intentionally
120
Fiscal
Year Taxes Levied Net Tax Levy Collections
Ended for the for the Percentage in Subsequent
December 31 Fiscal Year Fiscal Year (1) Amount of Net Levy Years
2007 $ 2,428,644 $ 2,394,822 $ 2,357,634 98.45 $ 37,188
2008 2,597,983 2,559,227 2,485,397 97.12 73,830
2009 2,708,155 2,672,623 2,624,026 98.18 48,591
2010 2,743,346 2,705,782 2,645,536 97.77 59,627
2011 2,789,559 2,745,785 2,692,423 98.06 52,284
2012 3,113,017 3,110,478 3,071,202 98.74 36,721
2013 3,163,359 3,160,524 3,133,764 99.15 23,735
2014 3,163,359 3,160,285 3,128,695 99.00 15,415
2015 3,113,017 3,133,137 3,112,989 99.36 12,713
2016 3,112,204 3,112,204 3,068,116 98.58
(1) Tax Levy adjusted for powerlines, market value credits and AG program credits prior to 2016
Fiscal Year of the Levy
Collected within the
CITY OF LAKE ELMO, MINNESOTA
SCHEDULE OF PROPERTY TAX LEVIES AND COLLECTIONS
LAST TEN FISCAL YEARS
121
Schedule 8
Delinquent
Total Taxes As A
Percentage Delinquent % Of Total
Amount of Net Levy Taxes Net Tax Levy
$ 2,394,822 100.00 $ 0.00
2,559,227 100.00 0.00
2,672,617 100.00 6 0.00
2,705,163 99.98 619 0.02
2,744,707 99.96 1,078 0.04
3,107,923 99.92 2,555 0.08
3,157,499 99.90 3,025 0.10
3,144,110 99.49 16,175 0.51
3,125,702 99.76 7,435 0.24
3,068,116 98.58 44,088 1.42
Total Collections to Date
122
Water (in millions of gallons)
Type of Customer 2016 2015 2014 2013 2012
Residential 98.044 84.007 98.573 120.676 154.747
Commercial Service 29.379 21.653 12.156 8.253 10.405
Total gallons 127.423 105.660 110.729 128.929 165.152
Total direct rate per 1,000 gallons - residential 2.14$ 2.14$ 2.14$ 2.14$ 2.14$
Total direct rate per 1,000 gallons - commercial 3.11$ 3.11$ 3.11$ 3.11$ 3.11$
Sanitary Sewer (in millions of gallons)
Type of Customer 2016 2015 2014 2013 2012
Residential (1) 6.812 3.794 0.000 0.000 0.000
Commercial Service 9.125 8.179 6.532 6.149 6.172
Total gallons 15.937 11.973 6.532 6.149 6.172
Total direct rate per 1,000 gallons 4.50$ 4.50$ 4.50$ 4.50$ 4.50$
(1) City did not have any residential sanitary sewer customers in 2014 and prior
* City converted to a tiered rate structure effective January 1, 2010; lowest tier rate listed for 2010-2015
CITY OF LAKE ELMO, MINNESOTA
WATER AND SANITARY SEWER CHARGES BY CUSTOMER
LAST TEN FISCAL YEARS
123
2011 2010*2009 2008 2007
105.290 95.704 122.461 120.986 108.649
6.872 7.261 7.989 7.851 8.746
112.162 102.965 130.450 128.837 117.395
2.14$ 2.10$ 2.15$ 2.05$ 2.05$
3.11$ 3.05$ 3.10$ 3.00$ 3.00$
2011 2010*2009 2008 2007
0.000 0.000 0.000 0.000 0.000
6.961 7.086 5.381 5.130 4.409
6.961 7.086 5.381 5.130 4.409
4.50$ 4.35$ 4.08$ 3.71$ 2.75$
Schedule 9
124
Total
Special Certificates Capital Governmental
Fiscal Assessment of Improvement Note Activities
Year Bonds Indebtedness Bonds Payable Debt
2007 $ 780,000 $ 364,000 $ 3,855,000 $ $ 4,999,000
2008 695,000 324,000 3,700,000 4,719,000
2009 1,120,000 283,000 3,540,000 4,943,000
2010 1,725,000 240,000 5,345,000 7,310,000
2011 2,440,000 196,000 5,175,000 7,811,000
2012 3,100,092 150,000 4,969,153 8,219,245
2013 4,436,967 102,000 1,941,135 6,480,102
2014 6,919,568 52,000 1,808,024 8,779,592
2015 8,095,288 1,687,803 21,219 9,804,310
2016 10,210,038 1,537,530 11,747,568
Note: Details of the city's outstanding debt can be found in the notes to
the financial statements.
Other Governmental Activities Debt
CITY OF LAKE ELMO, MINNESOTA
RATIOS OF OUTSTANDING DEBT BY TYPE
LAST TEN FISCAL YEARS
125
Total Total
Utility Business Primary Percentage
Revenue Activities Government of Personal Per
Bonds Debt Debt Income Capita
$ 4,810,000 $ 4,810,000 $ 9,809,000 0.03 $ 1,429
4,730,000 4,730,000 9,449,000 0.03 1,377
4,715,000 4,715,000 9,658,000 0.03 1,407
4,680,000 4,680,000 11,990,000 0.03 1,486
4,640,000 4,640,000 12,451,000 0.03 1,543
8,314,837 8,314,837 16,534,082 0.04 2,049
12,476,920 12,476,920 18,957,022 0.05 2,349
15,530,642 15,530,642 24,310,234 0.07 3,013
12,622,484 12,622,484 22,426,794 0.06 2,779
18,990,395 18,990,395 30,737,963 N/A 3,809
Schedule 10
Business-Type Activities
126
Special Certificates Capital Utility
Fiscal Assessment of Improvement Revenue
Year Bonds Indebtedness Bonds Bonds Total
2007 $ 780,000 $ 364,000 $ 3,855,000 $ 4,810,000 9,809,000$
2008 695,000 324,000 3,700,000 4,730,000 9,449,000
2009 1,120,000 283,000 3,540,000 4,715,000 9,658,000
2010 1,725,000 240,000 5,345,000 4,680,000 11,990,000
2011 2,440,000 196,000 5,175,000 4,640,000 12,451,000
2012 3,100,092 150,000 4,969,153 8,314,837 16,534,082
2013 4,436,967 102,000 1,941,135 12,476,920 18,957,022
2014 6,919,568 52,000 1,808,024 15,530,642 24,310,234
2015 8,095,288 1,687,803 12,622,484 22,405,575
2016 10,210,038 1,537,530 18,990,395 30,737,963
Note: Details regarding the city's outstanding debt can be found in the notes to the
financial statements.
See Schedule 15 for population data
See Schedule 5 for estimated market value information
Source: City of Lake Elmo Finance Department
General Bonded Debt Outstanding
CITY OF LAKE ELMO, MINNESOTA
RATIOS OF GENERAL BONDED DEBT OUTSTANDING
LAST TEN FISCAL YEARS
127
Net
Less: General Percentage
Available Bonded of Actual
in Debt Debt Taxable Value Per
Service Outstanding of Property Capita
$ 698,683 9,110,317$ 0.81 1,327$
727,673 8,721,327 0.76 1,271
1,422,049 8,235,951 0.68 1,200
3,605,250 8,384,750 0.70 1,039
3,534,742 8,916,258 0.78 1,105
3,500,799 13,033,283 1.26 1,615
726,753 18,230,269 1.77 2,259
691,700 23,618,534 2.26 2,927
2,477,730 19,927,845 1.68 2,470
3,215,590 27,522,373 2.17 3,411
Schedule 11
128
Schedule 12
Estimated
Estimated Share of
Debt Percentage Overlapping
Governmental Unit Outstanding Applicable (a)Debt
Debt repaid with property taxes
Independent School District #622 138,410,000$ 3.10% 4,290,710$
Independent School District #832 53,720,033 4.70% 2,524,842
Independent School District #834 113,990,000 14.10% 16,072,590
Other debt
Washington County 177,010,000 4.15% 7,345,915
Metropolitan Council 1,442,296,908 1.10% 15,865,266
Subtotal, overlapping debt 46,099,323
City direct debt 11,747,568 100.00% 11,747,568
Total direct and overlapping debt 57,846,891$
Sources: Tax capacity data to estimate applicable percentages provided by Washington County.
Debt outstanding data provided by each governmental unit.
Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the city. This schedule
estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses
of the City of Lake Elmo. This process recognizes that, when considering the city's ability to issue and repay long-term debt,
the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply
that every taxpayer is a resident, and therfore responsible for repaying the debt, of each overlapping government.
(a) For debt repaid with property taxes, the percentage of overlapping debt applicable is estimated using tax capacity values.
Applicable percentages were estimated by determining the portion of another governmental unit's tax capacity value that is
within the city's boundaries and dividing it by each unit's total tax capacity value.
December 31, 2016
COMPUTATION OF DIRECT AND INDIRECT GENERAL OBLIGATION BONDED DEBT
CITY OF LAKE ELMO, MINNESOTA
AND LEGAL DEBT MARGIN
This Page Left Blank Intentionally
129
2016 2015 2014 2013 2012
Debt limit 38,035,233$ 36,733,899$ 35,537,364$ 32,470,203$ 32,054,064$
Total net debt applicable to limit 2,102,343 1,572,289 1,757,421 1,894,510 2,099,369
Legal debt margin 35,932,890$ 35,161,610$ 33,779,943$ 30,575,693$ 29,954,695$
Total net debt applicable to the limit
as a percentage of debt limit 5.53% 4.28% 4.95% 5.83% 6.55%
The legal debt limit for municipalities in Minnesota was increased in 2008 from 2% to 3% of the market value of
taxable property. This limit applies only to the City's general obligation tax levy bonds and excludes special
assessment, tax increment and tax abatement bonds.
LAST TEN FISCAL YEARS
Fiscal Year
CITY OF LAKE ELMO, MINNESOTA
LEGAL DEBT MARGIN INFORMATION
130
Taxable Market Value 1,267,841,100$
Debt Limit (3% of market value) 38,035,233
Debt applicable to limit:
General obligation bonds 2,320,000
Less: Amount set aside for repayment
of general obligation debt 217,657
Total net debt applicable to limit 2,102,343
Legal debt margin 35,932,890$
2011 2010 2009 2008 2007
31,126,713$ 34,288,095$ 36,036,402$ 36,242,169$ 22,620,202$
2,148,203 2,195,153 271,142 315,169 358,220
28,978,510$ 32,092,942$ 35,765,260$ 35,927,000$ 22,261,982$
6.90% 6.40% 0.75% 0.87% 1.58%
Schedule 13
Legal Debt Margin Calculation for the Fiscal Year 2016
131
Schedule 14
Net
Fiscal Gross Operating Available
Year Revenue (1) Expenses (2) Revenue Principal Interest Coverage
2007 1,011,400$ 595,824$ 415,576$ 205,000$ 211,482$ 1.00
2008 715,611 536,475 179,136 80,000 202,224 0.63
2009 776,899 513,226 263,673 530,000 208,803 0.36
2010 920,768 563,896 356,872 35,000 191,156 1.58
2011 891,587 516,157 375,430 40,000 190,094 1.63
2012 946,407 426,118 520,289 40,000 221,129 1.99
2013 3,501,321 504,648 2,996,673 165,000 300,789 6.43
2014 2,266,397 678,394 1,588,003 365,000 424,080 2.01
2015 3,642,316 627,977 3,014,339 4,165,000 456,782 0.65
2016 3,407,097 757,862 2,649,235 615,000 380,969 2.66
Notes: (1) Gross revenue includes investment earnings, hook-up charges and special assessments.
(2) Operating expenses do not include interest, depreciation, or amortization expense.
(3) Details regarding the City's outstanding debt can be found in the notes to the financial
statements.
CITY OF LAKE ELMO, MINNESOTA
PLEDGED REVENUE COVERAGE
LAST TEN FISCAL YEARS
Utility Revenue Bonds
Debt Service (3)
132
SCHEDULE 15
PERSONAL
INCOME PER CAPITA STATE CITY
(thousands of PERSONAL UNEMPLOYMENT UNEMPLOYMENT
YEAR POPULATION (1)dollars)INCOME (2) RATE (3) RATE (3)
2007 6,863 $ 323,426 $ 47,126 5.0 4.2
2008 6,863 329,774 48,051 6.3 5.8
2009 6,863 317,997 46,335 7.6 7.1
2010 8,069 383,834 47,569 7.0 6.4
2011 8,069 409,203 50,713 5.8 5.2
2012 8,069 420,242 52,081 5.4 4.9
2013 8,069 420,879 52,160 4.6 4.0
2014 8,069 357,723 44,333 3.8 3.7
2015 8,069 371,602 46,053 3.2 2.9
2016 8,069 374,345 46,393 3.8 3.3
Sources: (1) Metropolitan Council 2000/2010-Census Bureau
(2) Bureau of Economic Analysis - Washington County, Minnesota
(3) Estimate based on County unemployment rate provided by Minnesota Department of
Employment and Economic Development
CITY OF LAKE ELMO, MINNESOTA
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN FISCAL YEARS
133
SCHEDULE 16
Employer Employees (2) Rank
Percentage of
Total City
Employment (1)Employees (1) Rank
Percentage of
Total City
Employment (1)
3M Company (Maplewood) 9,100 1 39.0% 10,100 1 56.4%
Andersen Corp (Bayport) 2,400 2 10.3%
Washington County (Stillwater) 1,600 3 6.9%
Healtheast Care/St. Johns Hospital (Maplewood) 1,200 4 5.1%
Woodwinds Health (Woodbury) 1,100 5 4.7% 485 5 2.7%
Fortis Company (Woodbury)1,021 2 5.5%
ISD 834 (Stillwater) 1,050 6 4.5% 1,000 3 5.6%
3M Company (Woodbury)
Ecowater Systems, Inc. (Woodbury) 440 7 1.9% 400 7 2.2%
Bremer Bank Operations Ctr (Lake Elmo) 425 8 1.8% 401 6 2.2%
MN Correctional Facility (Oak Park Hts) 355 9 1.5%
SunAmerica Financial Group (Woodbury) 310 10 1.3%
Imation (Oakdale)500 4 2.8%
High Pointe Health Campus (Lake Elmo) 180 8 1.0%
Lake Elmo Inn Inc.125 9 0.7%
Machine Shed/Wildwood Inn (Lake Elmo) 110 10 0.6%
(1) City staff estimate
(2) Number of current year employees for each employer was taken from information prepared for the 2016A bond issuance. Bond was issued
in April 2016 and therefore this information was updated prior to issuance of the 2015 CAFR and information has not changed since that date.
2007
CITY OF LAKE ELMO, MINNESOTA
PRINCIPAL EMPLOYERS
CURRENT YEAR AND NINE YEARS AGO
2016
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134
Function 2016 2015 2014 2013 2012
Administration 2.45 3.20 3.55 3.55 3.15
Finance 1.20 0.80 1.25 1.25 0.50
Planning and Zoning 2.21 2.75 2.70 2.95 1.55
General Government 5.86 6.75 7.50 7.75 5.20
Fire 3.80 1.50 1.55 2.05 1.60
Building Inspections 4.21 3.15 1.55 1.30 0.95
Public Safety 8.01 4.65 3.10 3.35 2.55
Streets and Roadways 4.55 3.90 3.20 3.21 3.05
Public Works 4.55 3.90 3.20 3.21 3.05
Parks 3.00 1.85 3.30 2.74 2.52
Parks and Recreation 3.00 1.85 3.30 2.74 2.52
Communications 0.00 0.70 0.35 0.40 0.15
0.00 0.70 0.35 0.40 0.15
Total Governmental Activities 21.42 17.85 17.45 17.45 13.47
Water Utility 2.00 2.45 2.60 2.10 1.85
Sewer Utility 1.66 1.30 0.70 0.70 0.30
Total Business Activities 3.66 3.75 3.30 2.80 2.15
Totals for Organization 25.08 21.60 20.75 20.25 15.62
Source: City's Adopted Budgets
CITY OF LAKE ELMO, MINNESOTA
FULL-TIME EQUIVALENT EMPLOYEES BY FUNCTION
LAST TEN FISCAL YEARS
135
Schedule 17
2011 2010 2009 2008 2007
3.15 3.15 3.18 3.75 2.40
0.50 0.50 0.50 1.00 1.29
1.55 1.55 1.75 1.75 2.15
5.20 5.20 5.43 6.50 5.84
1.10 1.10 1.10 1.10 1.26
0.95 0.95 1.95 1.20 2.68
2.05 2.05 3.05 2.30 3.94
3.05 3.05 3.05 3.05 2.78
3.05 3.05 3.05 3.05 2.78
2.52 2.52 3.10 2.72 3.40
2.52 2.52 3.10 2.72 3.40
0.15 0.15 0.19 0.00 0.00
0.15 0.15 0.19 0.00 0.00
12.97 12.97 14.82 14.57 15.96
1.85 1.85 1.85 2.30 2.02
0.30 0.30 0.30 0.35 0.22
2.15 2.15 2.15 2.65 2.24
15.12 15.12 16.97 17.22 18.20
136
Function/Program 2016 2015 2014 2013 2012
Planning and Zoning
Conditional use permits 3 2 4 2 3
Interim use permits 2 1 1 1 0
Minor subdivisions 2 2 0 2 1
Plats/Planned unit developments 11 9 17 1 0
Rezonings 3 2 11 2 7
Site plans 1 0021
Variances 4 2 2 5 4
Fire
Total emergency responses 430 429 358 448 399
EMS responses 268 274 237 280 262
Fire responses 162 32 21 28 28
Building Inspections
Residential permit valuations 119,301 50,401 23,032 19,979 20,320
(thousands of dollars)
Commercial permit valuations 2,003 1,952 7,309 966 2,351
(thousands of dollars)
New residential units (1) 240 140 41 32 31
New commercial units 1 1 3 0 0
Water Utility
Number of customers 1,538 1,234 1,073 1,051 1,016
Average daily consumption (2) 18 18 19 21 15
(thousands of gallons)
Sanitary Sewer Utility
Number of customers 321 82452929
Average daily flow (3)
(thousands of gallons) 14 74 77 77 75
Sources: Various City Department's annual budget workload measurements
(1) Excludes fire/demolition rebuilds
(2) Residential and Commercial; rate increase effective 1/1/2010 to encourage conservation
(3) Billed and measured based on water usage; new developer homes built in 2014 but not yet sold
or occupied so no impact to flows
CITY OF LAKE ELMO, MINNESOTA
OPERATING INDICATORS BY FUNCTION/PROGRAM
LAST TEN FISCAL YEARS
137
Schedule 18
2011 2010 2009 2008 2007
00213
31011
00211
00000
00110
01101
62568
315 361 319 294 369
195 211 205 204 244
24 14 24 20 46
16,133 15,889 12,903 16,525 22,739
2,590 2,013 1,617 1,370 3,600
24 26 29 23 29
01101
998 967 941 935 918
14 18 24 28 26
29 29 28 28 26
71 72 68 73 66
138
Function/Program 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
Fire
Stations 2222222222
Public Works
Bituminous streets (miles) 103 65 65 63 63 63 62 62 62 62
Gravel streets (miles) 2222222333
Street lights 150 144 144 142 137 137 137 137 137 137
Storm sewer (miles) 30252525252525252323
Park & Recreation
Acres of parkland 451 451 451 451 451 451 451 451 451 451
Number of parks 17171717171717171717
Water Utility
Water towers 3332222221
Miles of watermain 50434039373737373426
Number of fire hydrants 415 378 351 293 280 280 280 280 280 233
Sanitary Sewer Utility
Miles of sanitary sewer 8433333333
Lift stations 4443333333
Sources: Various City Department's annual financial report statistics
CITY OF LAKE ELMO, MINNESOTA
CAPITAL ASSETS STATISTICS BY FUNCTION/PROGRAM
LAST TEN FISCAL YEARS
Schedule 19
CITY OF LAKE ELMO, MINNESOTA
OTHER REPORT SECTION
December 31, 2016
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MINNESOTA LEGAL COMPLIANCE
Independent Auditor's Report
To the Honorable Mayor and
Members of the City Council
City of Lake Elmo, Minnesota
We have audited, in accordance with auditing standards generally accepted in the United States of
America, the financial statements of the governmental activities, the business-type activities, each major
fund and the aggregate remaining fund information of the City of Lake Elmo, Minnesota, as of and for the
year ended December 31, 2016, and the related notes to the financial statements, which collectively
comprise the City’s basic financial statements, and have issued our report thereon dated June 29, 2017.
The Minnesota Legal Compliance Audit Guide for Cities, promulgated by the State Auditor pursuant to
Minnesota State Statutes Sec. 6.65, contains seven categories of compliance to be tested: contracting and
bidding, deposits and investments, conflicts of interest, public indebtedness, claims and disbursements,
miscellaneous provisions and tax increment financing. Our audit considered all of the listed categories,
except that we did not test for compliance with the provisions for tax increment financing because the City
has not established a tax increment financing district.
In connection with our audit, nothing came to our attention that caused us to believe that the City of Lake
Elmo, Minnesota failed to comply with the provisions of the Minnesota Legal Compliance Audit Guide for
Cities, except as described below. However, our audit was not directed primarily toward obtaining
knowledge of such noncompliance. Accordingly, had we performed additional procedures, other matters
may have come to our attention regarding the City of Lake Elmo, Minnesota's noncompliance with the
above referenced provisions.
As of December 31, 2016, the City's records showed uncashed checks held for more than
three years. These checks were not reported and paid to the State Commission of
Commerce pursuant to Minn. Stat. Sections 345.41 and 345.43.
This report is intended solely for the information and use of those charged with governance and
management of the City of Lake Elmo, Minnesota and the State Auditor and is not intended to be and
should not be used by anyone other than these specified parties.
Minneapolis, Minnesota
June 29, 2017
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504427v1 SJS LA515-1
STAFF REPORT
DATE: August 1, 2017
REGULAR
MOTION
TO: City Council
FROM: Kristina Handt, City Administrator
AGENDA ITEM: Lions Park Improvements
REVIEWED BY: Rob Weldon, Public Works Director
Emily Becker, City Planner
Sarah Sonsalla, City Attorney
BACKGROUND:
Last September the City Council approved a design contract with Miller Architect for improvements to
Lions Park. The Parks Commission has held a series of meetings since last fall to gather more public
input and refine the proposed improvements. Through this process, they have worked to develop a
general master plan with multiple phases. At their April 17, 2017 meeting, the Parks Commission passed
a motion to increase the cost of Phase 1 improvements to $425,000.
Council discussed this at its May 9th work session and at the May 16th Council meeting authorized
advertising for bids for the various bid packages. Bids were advertised the end of June with the bid
opening for all bid packages held on July 19th.
ISSUE FOR DISCUSSION:
Should Council award the contracts for Lions Park Improvements?
PROPOSAL DETAILS/ANALYSIS:
The following bids were received on July 19:
Bidder Bid Package
1A Baseball
Field and Demo
Bid Package
1B Volleyball
Court
Bid Package
1C Batting
Cages
Bid Package
1D Parking
Lot
6 Urban
Companies
$388,000 $14,000 Not bid Not bid
Peterson
Companies
$283,324 $15,079 $16,749 $14,521
Rachel
Construction
$254,750 $11,200 $29,800 $11,800
Burski
Excavating
$349,000 $25,500 $36,600 $22,500
504427v1 SJS LA515-1
Bidder Bid Package
2A Irrigation
All Green
Landscape
$35,500
Greenscape $24,800
Burski Ex $30,000
Bidder Bid Package
3A 6 Metal
Poles
Bid Package
3B 4 Metal Poles
Bid Package
3C 6 Wooden
Poles
Killmer
Electric
$126,400 $119,800 $99,400
Ebert
Construction
$135,000 $130,000 $120,000
Burski Ex $182,700 $172,200 $132,300
Bidder Bid Package
4A Dugouts
6 Urban
Companies
$97,000
Ebert Const $92,800
Burski Ex $118,000
Based on the above bids, staff would recommend the Council award contracts to Rachel Construction, the
lowest bidder for bid packages 1A (Baseball Field and Demo) in an amount not to exceed $254,750, 1B
(Volleyball Court) in an amount not to exceed $11,200 and 1D (Parking Lot) in an amount not to exceed
$11,800; award the contract to Greenscape, the lowest bidder for bid package 2A (Irrigation) in an
amount not to exceed $24,800; award the contract to Killmer Electric, the lowest bidder for bid package
3C (6 Wooden Poles) in an amount not to exceed $99,400, and to reject all bids received for bid packages
3A (6 Metal Poles), 3B (4 Metal Poles), 1C (Batting Cages) and 4A (Dugouts).
With respect to the batting cages and dugout bid packages, for which staff is recommending that the
Council reject all bids, staff is of the opinion that the batting cages at the VFW field can be utilized for the
time being in order to save costs. Staff recommends not awarding the contract for the dugouts as the
Lions have agreed to donate $20,000 and volunteers in the community, including residents and Lake
Elmo Baseball, have offered to volunteer their time to construct the dugouts.
FISCAL IMPACT:
The City’s parkland dedication as of 7/25/17 was about $810,000 (after accounting for remaining Savona
park costs). The bid packages recommended by staff would total $401,950, which is less than
recommended by the Parks Commission in April due to the removal of some projects.
OPTIONS:
1) Award the contracts to the lowest bidders for bid packages 1A (Baseball Field and Demo), 1B
(Volleyball Court), 1D (Parking Lot), 2A (Irrigation), and 3C (Wooden Poles). Reject all bids
received for bid package 1C (Batting Cages), 3A (6 Metal Poles), 3B (4 Metal Poles) and 4A
(Dugouts).
2) Approve some other combination of bid packages than described above.
504427v1 SJS LA515-1
3) Reject all bids.
RECOMMENDATION:
Motion to award the contract for bid package 1A to Rachel Construction in an amount not to exceed
$254,750, bid package 1B to Rachel Construction in an amount not to exceed $11,200, bid package 1D
to Rachel Construction in an amount not to exceed $11,800, bid package 2A to Greenscape in an
amount not to exceed $24,800; bid package 3C to Killmer Electric in an amount not to exceed $99,400,
and to reject all bids received for bid packages 1C, 3A, 3B, and 4A.
ATTACHMENTS:
None