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City Council Regular Meeting Minutes 05 July 13, 2004 Page 4 1 Capital Project Funds - The City incurred improvement costs of approximately 2 $5,390,000 in 2003. Improvement costs related to the street improvement project totaled 3 $1,552,300. The acquisition of property and preliminary costs associated with the 4 renovation of public works facilities and construction of a fire station totaled 5 approximately$2,134,000. Also, included in improvement costs were project costs of the 6 storm water improvement program of$295,710 and park improvement costs of$526,840. 7 In addition, the HRA incurred significant costs related to securing redevelopment 8 agreements and payments to developers of$790,000. Proceeds from the issuance of 9 Public Facilities Lease Revenue bonds used to finance costs of the public works and fire 10 improvement projects which were unexpended at year(available for completion of 11 project costs) accounted for the increase in fund balance of the capital project funds. 12 13 Proprietary Funds - The Liquor Fund had net operating income of$184,457 for the 14 year. Operating income decreased due to the closure of the City's on-sale and off-sale 15 operations at one location during redevelopment of this property. Transfers of$320,000 16 were made from the Liquor Fund during the year; $175,000 to the General Fund and 17 $150,000 to the Capital.Equipment Fund. The Utility Fund had net income from 18 operations of$177,781 for the year. Utility rates were increased effective January 1, 19 2003, to eliminate operating losses incurred in prior years. These losses were partially 20 offset by investment income from water filtration funds. Revenues from the water 21 filtration funds are being used for maintenance of treatment facilities. The increase in 22 rates was also necessary to provide revenues for repayment of the bonds issued in 2003 23 related to system improvements. 24 25 Other Matters - Included in the accrued compensated absences liability at December 31, 26 2002, was approximately$100,000 related to compensatory time owed City employees. 27 Due to management efforts during the year this portion of the liability was significantly 28 reduced. Transfers from the General Fund were not necessary to pay these costs since the 29 liability was paid from operating funds during the year. 30 31 Mr. Bonniwell concluded in noting his report is intended solely for the information and use of 32 the City Council, management and others within the organization. He stated his 33 recommendations are intended to improve or strengthen financial management and 34 administration. 35 36 Motion by Councilmember Thuesen, seconded by Councilmember Faust,to Adopt Resolution 37 04-052 Approving the Audit of the City of St. Anthony for the Year Ended December 31, 2003. 38 39 Motion carried unanimously. 40 41 Discussion: 42 Councilmember Stille inquired as to Mr. Bonniwell's thoughts on how implementing GASB34 43 will better the City in moving forward. Mr. Bonniwell stated that the"principal"idea of 44 GASB34 is to provide one balance sheet rather than having several columns,noting it outlines 45 what the City's fixed assets are and shows that the depreciation of those assets are an expense to