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Home My WebLink About2018 Popular Annual Financial Report Popular Annual Financial Report To The Community For the fiscal year ended December 31, 2018 Your tax dollar is divided between several governmental entities. The City collects 29 cents of every tax dollar for City services. The remaining portions are divided among Washington County, the school district and other agencies. Area Tax Rates 1 Dividing up your Tax Dollar 1 General Fund 2 Internal Service Funds 3 Long-Term Debt 3 Special Revenue Funds 3 Capital Fund 4 Enterprise Funds 4 Overall Financial Condition 4 Monthly Bill 4 ,QVLGHWKLVLVVXH In a 2018 comparison of ten communities in Washington County, the average cost of services on a $382,800 homestead in terms of property taxes and property tax aids showed Lake Elmo ranking as one of the lowest. A $382,800 valued home in the Lake Elmo paid $71.07 per month in property taxes to the City. Dividing Up Your Property Tax Dollar Lake Emo, Minnesota 8¢ Other agencies 38¢ Washington 29¢ Lake Elmo 25¢ School District and allots them toward construction or major capital expenses. · Enterprise Funds account for activities that operate as public enterprises which are paid for by user fees, i.e., water, sewer & surface water management. · Internal Service Funds account for the acquisition, operation, and maintenance of governmental facilities and services, which are entirely or predominately self- supporting by user charges. · Fiduciary Funds account for resources held for the benefit of parties outside the City. · The General Fund accounts for revenues and expenses that provide for basic operations of the City i.e., police and fire protection and street maintenance. · Special Revenue Funds account for activities restricted to specific purposes like grants or economic development. · Debt Service Funds track revenues and expenses related to repayment of long term debt. · The Capital Funds collect revenues from special assessments, state, and county aids Making Cents Lake Elmo’s Six Basic Fund Types In order for the City to manage the community finances smoothly, it divides various activities into several Tax Rate Comparison Lake Elmo Ranked Well Against Surrounding Areas The City of Lake Elmo presents its Popular Annual Financial Report [PAFR]. The purpose of this report is to inform the community of the City’s financial activity in a simple, easy-to-read format for the fiscal year ending December 31, 2018. These highlights are based upon the City’s Comprehensive Annual Financial Report [CAFR] which is a more inclusive, audited document. County different funds. City Departments Administration: This department provides the overall direction for the City as determined by the City Council. It is responsible for maintaining City records, issuing licenses, administering Council policies, communications, and election procedures. Finance: This department conducts the financial affairs of the City of Lake Elmo and in accordance with the Government Accounting Standards Board (GASB) and Generally Accepted Accounting Principals (GAAP). This includes utility billing. Public Safety: This department includes police, and fire protection, and code enforcement, which includes building inspection activities. Planning: This department is responsible for ensuring that laws, ordinances, and zoning codes are enforced. It is also responsible for Economic Development within the City. Public Works: This department manages the City’s infrastructure as it relates to roadways, water, sewer, and surface water management as well as maintaining the City’s parks and trails. The City’s General Fund is the largest fund and also one of the most vital to the City’s operation. The General Fund is the primary fund that accounts for everyday general expenditures like street and park maintenance, police protection, and fire protection while at the same time supplementing portions of the other funds. Like most funds, the General Fund relies on the inflow of cash, shown as revenues and subsequently the outflow listed as expenditures. The primary revenue for the General Fund is property taxes. Intergovernmental revenues are items like state/county aid and grants. For the year the City’s revenue total was $5,034,896 which was a $481,638 (10.6%) increase from the previous year. This is mainly due to an increase in planning and zoning fees due to new development in the City, general permit revenue decreased from 2017 as there was significant storm damage in June of 2017 resulting in a number of permits issued for repairs. The other revenue classifications were similar to revenues received in 2017. 3DJH/DNH(OPR3RSXODU$QQXDO)LQDQFLDO5HSRUW General Fund Revenue The City’s total General Fund expenditures for 2018 were $4,309,877 which was $360,857 (7.8%) under the final budget. Overall, General Fund expenditures decreased $23,092 (1%) from 2017. General Government costs decreased $203,850 primarily due to vacant positions in both the finance and planning departments and a change in assessing services. Public Safety cost increased $173,433 due to increases in policing costs from Washington County, and an increase in the number of fire protection staff. Public works expenditures were similar to those in 2017, while Parks increased by $85,941 as a result of purchasing new equipment and contracting services for mowing. General Fund Expenditure ϮϬϭϳ ϮϬϭϴ WƌŽƉĞƌƚǇdĂǆĞƐ ϭ͕ϵϭϬ͕ϰϵϰ Ϯ͕ϯϵϲ͕ϳϮϬ >ŝĐĞŶƐĞƐΘWĞƌŵŝƚƐ Ϯ͕Ϭϰϲ͕ϰϲϮ ϭ͕ϯϭϳ͕ϲϰϴ /ŶƚĞƌŐŽǀĞƌŶŵĞŶƚĂů ϮϬϲ͕ϭϴϱ ϮϯϮ͕ϴϴϱ ŚĂƌŐĞƐĨŽƌ^ĞƌǀŝĐĞƐ ϭϯϳ͕ϵϮϬ ϴϮϭ͕Ϯϯϱ /ŶƚĞƌĞƐƚĂƌŶŝŶŐƐ Ϯϳ͕ϲϲϱ ϳϴ͕ϲϯϰ &ŝŶĞƐ ϰϭ͕ϰϭϴ ϰϵ͕ϮϬϯ DŝƐĐĞůůĂŶĞŽƵƐ ϭϴϯ͕ϭϭϰ ϭϯϴ͕ϱϳϭ dŽƚĂůZĞǀĞŶƵĞƐ ϰ͕ϱϱϯ͕Ϯϱϴ ϱ͕Ϭϯϰ͕ϴϵϲ Property Taxes 48% Licenses & Permits 26% Intergovernmenta… Charges for … Interest 1.5%Fines 1% Miscellaneous … Inflow: Where does the money come from? ϮϬϭϳ ϮϬϭϴ 'ĞŶĞƌĂů'ŽǀĞƌŶŵĞŶƚ ϭ͕ϰϭϭ͕ϵϵϱ ϭ͕ϮϬϴ͕ϭϰϱ WƵďůŝĐ^ĂĨĞƚǇ ϭ͕ϰϳϬ͕ϳϮϲ ϭ͕ϲϰϰ͕ϭϱϵ WƵďůŝĐtŽƌŬƐ ϭ͕ϭϴϱ͕ϴϮϴ ϭ͕ϭϵϴ͕ϭϮϭ WĂƌŬƐ ϭϳϯ͕ϱϭϭ Ϯϱϵ͕ϰϱϮ hŶĂůůŽĐĂƚĞĚ;'ĞŶ͘'Žǀƚ͘Ϳ ϵϬ͕ϵϬϵ Ϭ dŽƚĂůǆƉĞŶĚŝƚƵƌĞƐ ϰ͕ϯϯϮ͕ϵϲϵ ϰ͕ϯϬϵ͕ϴϳϳ Lake Elmo maintains a very good “Aa1” rating from Moody’s Investor Service, which allows the City to borrow funds at low interest rates and reflects sound financial position. The City currently has thirteen bond issues outstanding, with the final payment scheduled to be made through 2034. In 2018, the City issued $940,000 in General Obligation Bonds, Series 2018A to fund Equipment and $926,000 in Taxable Lease Revenue Bonds through the EDA to fund the purchase of the Brookfiled II building. The chart below shows the City’s current debt obligations. The 2018 revenues were $2,625,603 (special assessment collections, property taxes and interest) and expenditures were $1,379,739 in the Governmental Funds. The Enterprise Funds (Water, Sewer, and Storm Sewer) recorded $1,476,668 in special assessment revenue and $1,779,145 in bond payment expenses. /DNH(OPR3RSXODU$QQXDO)LQDQFLDO5HSRUW3DJH Long Term Debt The City prides itself on controlling spending while providing the best services possible. In 2018, the City’s expenditures (for all funds except Enterprise and Internal Service Funds) totaled $10,327,199, a decrease of 13.9% from 2017. The decrease was due to a decrease in capital outlay as a result of infrastructure improvements, park improvements and the purchase of equipment which varies from year to year. The chart above highlights the City’s ability to control its expenditures over a five year period and demonstrates the City’s priorities over different departments within the individual year. The City’s revenues for 2018 (for all funds except Enterprise and Internal Service Funds) totaled $8,270,340 a increase of 12.8% from 2017. This increase is attributable to an increase in planning & zoning fees, park dedication fees and charges for services as a result of new development. Special assessment collections also increased in 2018, but varies from year-to-year depending on construction projects. The graph below illustrates the City’s various revenue Special Revenue Funds The City had five special revenue funds in 2018. Special revenue funds are used to account for revenues derived from specific taxes or other earmarked revenue sources. They are required by statute to finance particular functions, activities, or governments. In April the City’s Economic Development Authority purchased the Brookfield Building which it had previously leased for City Hall Offices. Lease Revenue Bonds were issued to finance the purchase and lease revenues will be used to pay the bond payments and the operating expenditures of the building. EDA Revenues (including bond proceeds) - $1,030,217 EDA Expenditures (including building purchase) - $970,670 See the 2018 CAFR for more information. Internal Service Funds Internal service funds are an accounting device used to accumulate and allocate costs internally among the City’s various functions. The City maintained three internal service funds to account for certain capital acquisition activities (Radio Replacement, IT Replacement, and Equipment Replacement). These funds were closed out in 2018. See the 2018 CAFR for more information. Governmental Revenue & Expenditure 0 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 9,000,000 2014 2015 2016 2017 2018 Five Year Revenue ComparisonInvestment Earnings Miscellaneous Refunds and reimbursements Dedication Fees Special Assessments Fines and forfeitures Charges for Services Intergovernmental Licenses & Permits Taxes Fiduciary Funds Fiduciary funds are used to account for resources held for the bene- fit of parties outside the City. The resources of these funds are not available to support the City’s own programs. The City’s agency funds are used to record the receipt and remittance of monies held by the City as an agent primarily for land developers and builders that will be refunded to respective depositors when the conditions are satisfied in accordance with the respective agreements About this Report Lake Elmo reports financial year- end results in the Comprehensive Annual Financial Report (CAFR). The Popular Annual Financial Report (PAFR) is an unaudited report that summarizes the most significant data from the 2018 CAFR, and is consistent with Generally Accepted Accounting Principles. The report reflects the net tax cost by service expenditure, developed by crediting related revenues against appropriate expenditures and allocating local taxes against the remaining balance. For a complete review of the City’s financial position, consult the 2018 CAFR available on the City's website at www.lakeelmo.org, or from the Finance Department at 651.747- 3909. Capital Funds The City has twelve Capital Project Funds, nine which are for road improvements and additions, one for park and trail improvements, one for vehicle acquisition and replacement and for City facilities. The City has a program for maintaining the life of City streets, which identifies and tracks street conditions to ensure that the proper maintenance is scheduled at the appropriate time. The main revenue source for these funds are special assessments to benefitting properties and interest earnings. Revenue sources for the park improvement funds include park dedication fees and interest earnings. Projects in these capital funds are scheduled in the City’s 5-year capital improvement plan. The Capital Project funds had revenues of $516,294 in 2018. Bond proceeds and revenues from sales of capital assets totaled $948,991. Projects in 2018 included the City’s annual infrastructure improvements and other projects referred to in the City’s 5-year Capital Improvement Plan. Total expenditures were $3,645,210 in 2018. Residents receive a variety of City services at an affordable price. The cost of City services in 2018 for the owner of a median valued home ($382,800) in Lake Elmo is $71.07 per month. The value received from City services compared favorably to charges of other monthly bills. Property Tax-Supported Services The checkbook shows how the monthly cost of property tax-supported services was divided among City departments. Monthly Cost of Utilities Based on an average usage of 7,000 gallons per month, monthly cost of utilities for a home in the City is $35.52 in 2018 (The City bills water and sewer on a quarterly basis and storm water on an annual basis). The bill includes water, sewer, and storm water. How Tax Dollars Buy City Services Check Register Description of Transaction Balance Public Safety $21.65 General Government $15.45 Culture and Recreation (Parks ) $ 3.13 Public Works $15.68 Debt Services $15.16 Total $71.07 71.07 January 1, 2018 Homeowner City of Lake Elmo Seventy-one & 07/100———————————————— MONTHLY police, fire, street maintenance, parks, letc. Homeowner Lake Elmo, MN YOUR BANK These funds consist of utility services provided to the community by the City such as water, sanitary sewer, and storm water . The City completed a Comprehensive Financial Management Plan for all Utility Funds in 2016 which included establishing annual increases in fees and charges beginning in 2018 to ensure the City is able to maintain sufficient cash in funds over the long-term. Enterprise Fund Overall the City’s financial condition remains stable in 2018 as demonstrated by the City’s net position of $48,198,180 with an increase of $5,213,136 during 2018. At year end, the general fund unassigned balance was 85% of the next year’s total general fund expenditures Total outstanding debt decreased by $604,000 during 2018 while cash and investments increased by $2,906,640. Overall Financial Condition $2,365,836 $3,061,245 $340,047 $2,069,018 $846,032 $315,967 $0 $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 Water Sewer Storm Water 2018 Enterprise Funds Revenues Expenses