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Item No. 5.D. mou—p—�nDitsvirw Meeting Date October 27, 2025 Type of Business: Consent Agenda Administrator Review: City of Mounds View Staff Report To: Honorable Mayor and City Council From: Gayle Bauman, Finance Director Item Title/Subject: Financial Report for the Quarter Ended September 30, 2025 SUMMARY FINANCIAL REPORT The third quarter financial results are generally as expected. During the year, City books are kept on a cash basis which means that only items that are received are booked as revenue and items paid are booked as expenditures. The City is not anticipating a reduction in State revenues for 2025. One of the greatest challenges has been filling the police officer positions. General Fund: The main source of revenue for the City is property taxes and these come in twice a year. Expenditures are at 71.0% of budget through the end of the quarter, compared to 53.9% last year. Some of this difference is due to the timing of invoices. The majority of the difference is due to not budgeting for Transfers Out in 2025. Most of the General Fund revenues come in late in the second quarter and then again late in the fourth quarter, so it is important to maintain a fund balance that approximates 50% of budgeted expenditures and transfers for cashflow purposes. The General Fund ended 2024 with unassigned fund balance that is equal to 50.2% of the 2025 budgeted expenditures and transfers compared with 54.86% in 2023. Other Funds: The Street Improvement Capital Projects Fund ended 2024 with a fund balance of$2,216,511. This fund is integral in maintaining the newly reconstructed streets and reconstructing streets still in need. The major projects for 2025 are street improvements on Bronson Drive, Pine Wood Circle and Edgewood Drive, and the annual sealcoating project. Other projects in the City include Tribute Park, CIPP sanitary sewer lining, and storm water maintenance. Investments & Economy: Investment income to date for 2025 is $404,037 compared with $357,870 for the same period in 2024. The market value of our portfolio for September 30, 2025 was 20,397,543 compared with $18,755,165 for 2024. The Federal Open Market Committee (FOMC) has decided to lower the target range for the federal funds rate by '/4 percentage to 4 to 4 '/4 percent. It seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. Uncertainty about the economic outlook remains elevated. Inflation has moved up and remains somewhat elevated. Treasury securities are presently providing the following rates-of-return: Treasury Securities 2025 2024 1 year 3.680 3.980 2 year 3.600 3.660 5 year 3.740 3.580 10 year 4.160 3.810 30 year 4.730 4.140