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City Council Study Session Meeting Minutes May 8, 2001 Page 7 • 1 the organization. He stated that the financial condition of the City continues to remain strong. 2 He noted that the City's financial condition has not changed significantly over the past several 3 years. 4 Mr. Bonniwell continued by reviewing a summary of significant activities of the different fund 5 categories: 6 The General Fund at December 31,2000 was $976,523, which represented an increase of 7 12.15% from the prior year's fund balance. Revenues and transfers of$3,472,701 were 8 less than budgeted estimates by approximately $55,000 due to a budget transfer of 9 $250,000 not deemed necessary by City management. The fund balance of the General 10 Reserve Fund of$250,000 was designated for revenue stabilization purposes in the 11 General Fund, or for capital acquisitions in 2001. 12 Many of the Debt Service Funds maintained relate to the City's street improvement 13 program. Existing fund balances, combined with annual tax and assessment levy 14 amounts, was sufficient to satisfy 2001 debt service requirements. 15 16 The Capital Project Funds for the year 2000 were largely used for improvement costs. 17 Improvement costs incurred by the City amounted to $3,837,973. Proceeds from two 18 bond issues, in addition to state aids, were used to fund those projects. WO Proprietary Funds. The financial condition of each enterprise fund improved based on 21 results of operations for 2000. The Liquor Fund had a net income of$217,822 for the 22 year. After budgeted transfers of$140,000, the increase in retained earnings was 23 $77,822. The Utility Fund had a net income from operations of$514,366 for the year. 24 Retained earnings of the Utility Fund were approximately $7,000,000, which are reserved 25 for water filtration and purification improvements. The Deficit of the Employee Benefit 26 Fund is $196,615 at the end of the year. The liability for compensated absences increased 27 as a result of the conversion from sick days to personal leave days for computation of the 28 liability amount. 29 30 Mr. Bonniwell reviewed the Government Accounting Standards Board (GASB) Statement 31 Number 34 with the Council. He indicated it was the most significant change in the 32 governmental financial reporting model in over twenty years. He said this statement establishes 33 financial reporting standards for state and local governments. 34 Mr. Bonniwell reviewed some of the major concepts of the Statement: 35 1. A section titled "management's discussion and analysis' must be added to the 36 financial report and statements. 37 2. Government-wide financial statements will replace the current general purpose 38 financial statements as they are referred to. 3. Individual fund financial statements will also be included in the financial report. 40 4. Required supplementary information must include: