Agenda Packets - 2004/04/12 - Laserfiche WebLink

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Item No. 9D Meeting Date: April 12, 2004 Type of Business: Council Business Administrator Review: _______ City of Mounds View Staff Report To: Honorable Mayor and City Council From: Charles Hansen, Finance Director Item Title/Subject: Resolution 6215 Approving Transfers Between Funds for the Year 2003 This item was first presented at the March 22 City Council meeting, but was held over to the April 12, 2004 meeting. Since then, one change has been discovered as the result of audit fieldwork. In the original allocation of the December property tax settlement, a deduction for a tax court petition was allocated entirely from the General Fund’s tax receipts. A portion of it should have been deducted from TIF District #1’s tax receipts. Correcting this moves $148,795.00 from TIF District #1 to the General Fund. As a result, the General Fund has a larger surplus and I have increased its transfer to the Special Projects Fund. The attached resolution approves transfers between funds for the year 2003. Many of the transfers are in the amount originally approved in the 2003 budget. In several cases, operating results during 2003 dictate that a different amount be transferred. The General Fund operations from 2002 produced a surplus of $1,047,972 that was held in the General Fund in anticipation of budget cuts from the State of Minnesota. This resulted in a fund balance that exceeds the high end of the range recommended by the Office of the State Auditor. That range is 30% to 50% of the next year’s budgeted expenditures. In order to avoid prolonged criticism from the Auditor, I am recommending a series of steps to reduce the balance in the General Fund. First of these is to cancel all budgeted 2003 transfers from other funds into the General Fund. This will help the other funds that also have budgetary stresses of their own. The second step is to make several transfers from the General Fund to other funds as of December 31, 2003. These are designed to correct deficiencies in other funds or to make resources available where they will most benefit the City. Community Center operations suffered during 2003 due to the cost of changing banquet center managers and the cost of damage from the lighting strike in June. Insurance may cover most of the damage, but that hasn’t been settled yet.