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Mounds View City Council Apri112, 2004 <br />Regular Meeting Page 11 <br />• Council Member Gunn commented that this brings the amount down to the limit of what the <br />auditor will approve. <br />Finance Director Hansen indicated the Office of the State Auditor recommends a 30% to 50% of <br />next year's budget and this would leave just above 50%. <br />Council Member Marty commented that there is a transfer of $148,795 from TIF to the general <br />fund and then transferring from the Community Fund to TIF District One. <br />Finance Director Hansen indicated that in working with the auditor it was determined that he <br />made a mistake in the December tax settlement allocated to TIF District One and this is a <br />correction for that having a ripple effect through four funds. <br />Council Member Quick asked why the City needs to have 50% of the annual budget in the <br />general fund. <br />Finance Director Hansen indicated that 80% of the general fund revenues for the year come in <br />the form of property tax settlement and payment of aids from Minnesota and that is received in <br />July and December so the City needs a bank balance to work through July. <br />Council Member Quick asked what happens if the City does not have that money. <br />• Finance Director Hansen indicated the City would have to utilize short-term borrowing and that <br />is expensive and not looked upon very highly in the financial market. <br />Council Member Stigney asked if the City could get by with 30% in reserves. <br />Finance Director Hansen indicated that the May/June cycle would have a deficit if the City went <br />with a 30% fund balance. <br />Ayes - 5 Nays - 0 Motion carried. <br />E. Resolution 6216 Approving Inter-Fund Loans for the Year 2003 and Setting <br />an Interest Rate on Inter-Fund Loans for the Year 2004. <br />Council Member Marty asked whether SEH ever straightened out the MSA allotment. <br />Finance Director Hansen indicated he had explained to Council Member Marty that he has never <br />been satisfied that SEH straightened out the account with the state of Minnesota and has never <br />received information from SEH as to whether anything was missed. He then said that an MSA <br />account should not run a deficit and this one has for the last two years. <br />MOTION/SECOND: Marty/Gunn. To Direct Staff to Contact SEH For the Facts and Figures <br />for An Analysis. <br />• <br />