Agenda Packets - 1997/03/03 - Laserfiche WebLink

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City of Mounds View Staff Report February 27, 1997 Page 2 agree. To improve accountability and understandability, it is recommended that these • funds be consolidated in 1996 and reported by District(ie three funds, one for each district). The City has also been purchasing property for redevelopment and offering business loans at a reduced interest rate. While we are still early in this process, the initial reporting of this activity has been in the TIF funds. It is recommended that we establish a separate revolving loan fund in 1996 to report the repayment on the loans and the sale of the property. In the future, moneys in this fund could be used for additional loans or other projects as the Council deemed appropriate. Overall, this would be a cleaner approach since once a loan is made or property is purchased, it loses the TIF restrictions on how the funds can be spent and also eliminates the need for continued reporting to the state. Also, by establishing a separate fund,we would still be tracking the activity and could used the sale and repayments to continue the program once the existing TIF districts are decertified. Fire Bond Fund of 1991 The City is a participant in a joint venture for fire services. As part of this arrangement, the City of Blaine issued debt for system improvements and the City of Mounds View pays Blaine a portion of the debt service on the bonds. Because the City did not issue debt and does not make the actual debt service payments,this fund should be consolidated into the general fund in 1996. Separate accounts would be used to insure • adequate detail is maintained for the activity associated with the Fire Bonds. CAPITAL PROJECT FUNDS Park Improvement Fund. This fund is used to report the collection and expenditure of parkland dedication fees. At the end of 1996, the funds should be substantially depleted. Also, on an annual basis,the City has historically spent more on park improvements than it has collected on parkland dedication fees. Regardless of the amount collected or spent, the activity in this fund could be accounted for and reported in the same detail as presently exists by combining it with the general fund. Any unspent amounts could be reported as a reservation of cash and fund equity, any receipts on new parkland dedication fees would be reported as a separate revenue line item which would increase the cash and equity reserves, and any use of the funds would be reported as an expenditure which would also reduce the cash and equity reserves. This change would result in not having to transfer funds which tend to inflate operating results (both the transfer out and the actual expenditure of funds are reported as an outlay, therefore when financial statements are analyzed, it appears that there was a larger increase in outlays than was actually the case.) State Aid Fund. This fund accounts for the activity associated with improvements to State Aid road improvements. Funding for such projects comes from a number of sources including state construction aid, special assessments,water/wastewater/surface water contributions,