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HomeMy WebLinkAbout2011 CAFRCity of, Saint Anthony Saint Anthony, Minnesota Comprehensive Annual Financial Report LOur mission is to be a progressive and livable community, a walk able village, which is sustainable, safe and secure L 0 COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE CITY OF ST. ANTHONY, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2011 Prepared By: Finance Department Shelly Rueckert, Finance Director - This page intentionally left blank - CITY OF ST. ANTHONY, MINNESOTA TABLE OF CONTENTS I. INTRODUCTORY SECTION Page Reference No. Letter of Transmittal 3 Organization 7 Organization Chart 8 II. FINANCIAL SECTION Independent Auditor's Report 11 Management's Discussion and Analysis 13 Basic Financial Statements: Govemment-Wide Financial Statements: Statement of Net Assets Statement 1 27 Statement of Activities Statement 2 28 Fund Financial Statements: Balance Sheet - Governmental Funds Statement 3 30 Statement of Revenues, Expenditures and Changes in Fund Balance - Governmental Funds Statement 4 32 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds Statement 5 34 Statement of Net Assets - Proprietary Funds Statement 6 35 Statement of Revenues, Expenses and Changes in Fund Net Assets - Proprietary Funds Statement 7 36 Statement of Cash Flows - Proprietary Funds Statement 8 37 Statement of Fiduciary Net Assets - Fiduciary Fund Statement 9 38 Notes to Financial Statements 39 Required Supplementary Information: ' Budgetary Comparison Schedule - General Fund Statement 10 84 Budgetary Comparison Schedule - Note to RSI 89 Schedule of Funding Progess - Other Post Employment Benefits Plan Statement 11 90 t _. CITY OF ST. ANTHONY, MINNESOTA TABLE OF CONTENTS Supplementary Financial Information: HRA Debt Service Fund Balance Sheet Exhibit 1 Page Schedule of Revenues, Expenditures and Changes in Fund Balance Reference No. HRA Projects Fund: Combining and Individual Nonmajor Fund Financial Statements and Schedules: Balance Sheet Combining Balance Sheet - Nonmajor Governmental Funds Statement 12 95 Combining Statement of Revenues, Expenditures and Changes in Fund Balance - 125 Water and Sewer Enterprise Fund: Nonmajor Governmental Funds Statement 13 96 Subcombining Balance Sheet - Nonmajor Special Revenue Funds Statement 14 99 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balance - Nonmajor Special Revenue Funds Statement 15 100 Subcombining Balance Sheet - Nonmajor Debt Service Funds Statement 16 104 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balance - Nonmajor Debt Service Funds Statement 17 106 Subcombining Balance Sheet - Nonmajor Capital Project Funds Statement 18 110 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balance - Nonmajor Capital Project Funds Statement 19 112 Special Revenue Funds: Schedules of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual: Community Center Fund Statement 20 114 Police Forfeiture Fund Statement 21 115 Recycling Fund Statement 22 116 HRA Fund Statement 23 117 Fire Education/Training Fund Statement 24 118 Statement of Changes in Assets and Liabilities - Agency Fund Statement 25 119 Supplementary Financial Information: HRA Debt Service Fund Balance Sheet Exhibit 1 122 Schedule of Revenues, Expenditures and Changes in Fund Balance Exhibit 2 123 HRA Projects Fund: Balance Sheet Exhibit 3 124 Schedule of Revenues, Expenditures and Changes in Fund Balance Exhibit 4 125 Water and Sewer Enterprise Fund: Schedule of Revenues, Expenses and Changes in Fund Net Assets Exhibit 5 126 CITY OF ST. ANTHONY, MINNESOTA TABLE OF CONTENTS III. STATISTICAL SECTION (Unaudited) Financial Trends Page Reference No. Net Assets by Component Table 1 128 Changes in Net Assets Table 2 129 Fund Balances - Governmental Funds Table 3 131 Changes in Fund Balances - Governmental Funds Table 4 132 Revenue Capacity Tax Capacity Value and Estimated Market Value of Taxable Property Table 5 134 Direct and Overlapping Property Tax Rates Table 6 135 Principal Property Taxpayers Table 7 136 Property Tax Levies and Collections Table 8 137 Debt Capacity Ratios of Outstanding Debt by Type Table 9 138 Direct and Overlapping Governmental Activities Debt Table 10 140 Legal Debt Margin Information Table 11 141 Pledged Revenue Coverage Table 12 142 Demographic and Economic: Demographic and Economic Statistics Table 13 146 Principal Employers Table 14 147 Operating Information: Full -Time Equivalent City Government Employees by Function/Program Table 15 148 Operating Indicators by Function/Program Table 16 150 Capital Asset Statistics by Function/Program Table 17 152 - This page intentionally left blank - I. INTRODUCTORY SECTION - This page intentionally left blank - i611arC� June 18, 2012 To the Honorable Mayor, Members of the City Council, and Citizens of the City of St. Anthony, Minnesota: State law requires that all general-purpose local governments publish within six months of the close of each fiscal year a complete set of audited financial statements. This report is published to fulfill that requirement for the fiscal year ended December 31, 2011. Management assumes full responsibility for the completeness and reliability of the information contained in this report, based upon a comprehensive framework of internal controls that have been established for this purpose. Because the cost of internal controls should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements. HLB Tautges, Redpath, Ltd., Certified Public Accountants, have issued an unqualified opinion on the City of St. Anthony's financial statements for the year ended December 31, 2011. The independent auditor's report is located at the front of the financial section of this report. Management's discussion and analysis (MD&A) immediately follows the independent auditor's report and provides a narrative introduction, overview, and analysis of the basic financial statements. MD&A complement this letter of transmittal and should be read in conjunction with it. Profile of the City The City of St. Anthony, incorporated in 1945, is located near Northeast Minneapolis and is a first ring northern suburb of the Minneapolis -St. Paul metropolitan area. The City is a completely developed community and is bordered on all sides by the communities of Minneapolis, Columbia Heights, New Brighton and Roseville. Approximately two-thirds of the City is located in northeastern Hennepin County and one-third is located in the northwest corner of Ramsey County. The City encompasses a land area of 2.35 square miles and serves a population of 8,226. The City is located 10 minutes north of downtown Minneapolis and 15 minutes northwest of downtown St. Paul. City residents and businesses have easy access to all parts of the Minneapolis -St. Paul metropolitan area by the use of Interstate 35W, Interstate 694 and Highway 280. L_. 3301 Silver Lake Road, St. Anthony, MN 55418-16999www.ci.saint-anthony.mn.us• (612) 782-3301• (612) 782-3302 Our mission is to be a progressive and livable community, a walkable village, which is sustainable, safe and secure. 3 L. The City is served by Independent School District (ISD) #282 (St. Anthony), which has a 2011/2012 enrollment of approximately 1,769, operates one elementary school, a middle school and senior high in the City. In addition, a private school, St. Charles Borromeo, offers K-8 grade education with enrollment of approximately 305 students. The City operates as a statutory Council -Manager form of government. Policy-making and legislative authority are vested in the City Council consisting of one elected mayor and four council members. The City Council is responsible, among other things, for passing ordinances, adopting the budget, appointing committees, and hiring the City Manager. The City Manager is responsible for carrying out the policies and ordinances of the City Council, overseeing the day-to-day operations of the City, and appointing the heads of the various departments. The Council is elected on a non-partisan basis. Council members serve four-year staggered terms, with two council members elected every two years. The Mayor is elected to serve a four-year term. The City of St. Anthony provides a full range of services including administrative services; police protection; fire suppression and prevention; construction of capital improvements; reconstruction and maintenance of city streets and other infrastructure; distribution of water; sanitary sewer collection; storm water drainage; parks and recreational activities; forestry maintenance; and recycling. The St. Anthony Firefighters' Relief Association is a separate legal entity, and accordingly is excluded from this report. The St. Anthony Housing and Redevelopment Authority (HRA), an entity legally separate from the City, is governed by a board which includes the City Council. Its sole purpose is to promote economic development within the City of St. Anthony. The HRA is a component unit of the City and its financial transactions have been included in these financial statements as a blended component unit. Additional information on both of these legally separate entities can be found in Note 1(A) & 6(D) in the notes to the financial statements. The annual budget serves as the foundation for the City of St. Anthony's financial planning and control. All departments of the City of St. Anthony submit requests for appropriations to the City Manager in June of each year. The City Manager uses these requests as the starting point for developing the recommended budget. The City Manager then presents the recommended budget to the City Council for their review prior to the certification of the proposed levy to the County Auditors by September 15th. The City Council is required to hold public hearings on the proposed budget and to adopt a final budget by December 31, the close of the City of St. Anthony's fiscal year. The appropriated budget is prepared for the General Fund by function (e.g., public safety), and department (e.g., police), and object code (e.g., salaries). Department heads may make transfers of appropriations within a department. Transfers of appropriations between departments, however, require the approval of the City Council. Budget -to - actual comparisons are provided on Statement 10 as required supplementary information to the basic financial statements for the governmental funds. Factors Affecting Financial Condition The information presented in the financial statements is perhaps best understood when it is considered from the broader perspective of the specific environment within which the City of St. Anthony operates. Local Economy: The Minneapolis -St. Paul metropolitan area has continued to experience a relatively stable economy. The market place for local products and services remains strong. St. Anthony is a fully developed City. However, continued long-term growth is anticipated as St. Anthony continues to pursue redevelopment opportunities. Long -Term Financial Planning: The City maintains internal service funds for the replacement of various capital assets. The Capital Equipment Fund provides funding for the replacement of the City's fleet including all vehicles and heavy equipment that have a value of $5,000 or more and a useful life of at least two years. The Road Improvement Funds have been established for the replacement of the City's roads and infrastructure, including the resurfacing and reconstruction of City's streets, sidewalks and storm water system. The City combines the use of Goal Setting and Key Financial Management Planning to identify and prioritize all City improvement projects. On an on-going basis, projects are identified, discussed and prioritized by the City Council. Once the project is identified, a complete analysis is done to review the impact, examine the funding sources available to determine the appropriate funding source and budget for the costs. Cash Management Policies and Practices: The City's foremost investment objective is to preserve capital. Secondary considerations are liquidity and lastly yield. Accordingly, deposits are either insured by federal depository insurance or collateralized. All temporary cash surpluses during the year are invested in various securities defined by Minnesota Statutes. The City's policy is to invest all available monies at competitive interest rates in accordance with the City's over-all fiscal plan and coordinate them with operating needs and programs projected over the ensuing 12 months. Risk Management: The City uses a proactive approach to limit its liability risk and insurance costs. To assist employees who are injured while on duty, Managed Care Program is used to reduce medical expenses and other costs relating to workplace injuries. The program assists employees with a treatment plan which reduces lost workdays, replacement workers, etc. In addition, a safety committee consisting of employees from every department meets monthly throughout the year to discuss safety related items, review accident reports and provide recommendations to reduce the City's exposure to liability. The City's general liability insurance is with the League of Minnesota Cities Insurance Trust. In order to reduce the cost of insurance, a $10,000 per occurrence/$50,000 aggregate deductible is maintained and funded through insurance dividends paid by the League of Minnesota Cities. Awards: The City of St. Anthony received the following awards in 2011: 1) MPCA — GreenStep City, Step 1 and Step 2 Grants: Each year, the City actively participates in Federal, State and County administered grants. In 2011 the Police, Fire, Public Works and Administration received a variety of safety and training grants. A list of the grants includes: A. FEMA- Warning Siren Grant. B. Metropolitan Council Environmental Services -Sanitary Sewer Improvements. C. Mississippi Watershed Management Organization — Parks Department Equipment. D. Minnesota Board of Firefighter Training and Education Grant. E. Minnesota Firefighter Disability Grant. F. Safe and Sober Grant — Alcohol Compliance Grant. G. State of Minnesota — Vest Grant. H. State of Minnesota — Operation Heat Grant. I. Ramsey County — Score Recycling Grant. J. Ramsey County — Electronic Citation Grant. K. CenterPoint Energy — Fire Department Equipment. L. FEMA — Firefighter Grant. Partnerships: The City partners with local businesses, civic organizations and the Chamber of Commerce to provide a variety of community safety and education programs. In 2011, the City continued to receive funding for the "Citizens Academy" and "Crime Prevention" which provides alcohol awareness training and public safety for our residents. In addition, the City installed a Veteran's Memorial monument. This was a joint endeavor between St. Anthony Kiwanis, St. Anthony residents, St. Anthony local businesses and the City of St. Anthony. Acknowledgements: Finally, we would like to express our gratitude to the Mayor and the City Council. Their unfailing support for maintaining the highest standard of professionalism in the management of the City of St. Anthony's finances results in a fiscally sustainable City government. Respectfully submitted, IVAJ Mark Casey City Manager Shelly Rueckert Finance Director CITY OF ST. ANTHONY, MINNESOTA ORGANIZATION December31.2011 Term Expires Mayor: Jerry Faust December 31, 2015 Council Members Hal Gray December 31, 2015 Jim Roth December 31, 2015 Randy Stille December 31, 2013 Jan Jenson December 31, 2013 City Manager: Mark Casey Appointed Finance Director: Roger Larson (retired January 5, 2012) Appointed 7 L z w w O w II. FINANCIAL SECTION This page intentionally left blank - 10 TAUTGES REDPATH, LTD. Certified Public Accountants INDEPENDENT AUDITOR'S REPORT To the Honorable Mayor and Members of the City Council City of St. Anthony, Minnesota We have audited the accompanying financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of St. Anthony, Minnesota, as of and for the year ended December 31, 2011, which collectively comprise the City of St. Anthony, Minnesota's basic financial statements as listed in the table of contents. These financial statements are the responsibility of the City of St. Anthony, Minnesota's management. Our responsibility is to express opinions on these financial statements based on our audit. The prior year partial comparative information has been derived from the City of St. Anthony, Minnesota's 2010 financial statements and, in our report dated May 23, 2011, we expressed unqualified opinions on the respective financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of St. Anthony, Minnesota, as of December 31, 2011, and the respective changes in financial position, and cash flows, where applicable, thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America. As discussed in note 18 to the financial statements, the City adopted the provisions of Governmental Accounting Standards Board Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions, for the year ended December 31, 2011. Adoption of the provisions of this statement results in changes to classifications of the components of fund balance and the reclassification of the Water Filtration and Purification fund. 4810 White Bear Parkway White Bear Lake, MN 551141 651.426.7000 651.426.5004 fax www.hlbtr.com Equal Opportunity Employer 100 -Percent Employee -Owned HLB Tautges Redpath.. Ltd, is a member of HLB International, a world-ande network of independent accounting firms and business advisors. In accordance with Government Auditing Standards, we have also issued our report dated June 18, 2012 on our consideration of the City of St. Anthony, Minnesota's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. Accounting principles generally accepted in the United States of America require that the management's discussion and analysis and budgetary comparison information and OPEB Schedule of Funding Progress on pages 13 through 23 and 84 through 90 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of St. Anthony, Minnesota's financial statements as a whole. The introductory section, combining and individual nonmajor fund financial statements and supplementary financial information and statistical section are presented for purposes of additional analysis and are not a required part of the financial statements. The combining and individual nonmajor fund financial statements and supplementary financial information are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole. The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on them. HLB TAUTGES REDPATH, LTD. June 18, 2012 12 MANAGEMENT'S DISCUSSION AND ANALYSIS As management of the City of St. Anthony, Minnesota, we offer readers of the City of St. Anthony, Minnesota's financial statements this narrative overview and analysis of the financial activities of the City of St. Anthony, Minnesota for the fiscal year ended December 31, 2011. We encourage readers to consider the information presented here in conjunction with additional information that we have famished in our letter of transmittal, which can be found in the Introductory Section of this report. Financial Highlights • The assets of the City of St. Anthony, Minnesota exceeded its liabilities at the close of the most recent fiscal year by $23,665,941 (net assets). • The City's total net assets increased by $889,505 from the prior years stated net assets. • As of the close of the current fiscal year, the City of St. Anthony's governmental funds reported combined ending fund balances of $8,305,131, an increase of $1,851,615 in comparison with the prior year stated fund balances. • At the end of the current fiscal year, unassigned fund balance for the General Fund was $1,647,566 or 36.88 % of total General Fund Budget. • The City of St. Anthony's total bonded debt increased by $2,080,000 (6.2%) during the current fiscal year. The key factors in this increase were; 1) pay offfref ending of the 2003A G.O. Road Improvement Bond totaling $1,135,000; 2) principal retirement of $1,950,000; 3) issuance of the 2011A $2,955,000 G.O. Road Improvement Bonds; and 4) issuance of the 2011B $2,210,000 G.O. Road Improvement Bonds. Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the City of St. Anthony, Minnesota's basic financial statements. The City of St. Anthony, Minnesota's basic financial statements comprise three components: 1) government -wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. Government -wide financial statements. The government -wide financial statements are designed to provide readers with a broad overview of the City of St. Anthony, Minnesota's finances, in a manner similar to a private -sector business. The statement of net assets presents information on all of the City of St. Anthony, Minnesota's assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the City of St. Anthony, Minnesota is improving or deteriorating. 13 L The statement of activities presents information showing how the City's net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave). Both of the government -wide financial statements distinguish functions of the City of St. Anthony, Minnesota that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business -type activities). The governmental activities of the City of St. Anthony, Minnesota include general government, public safety, public works, parks and recreation, services to other cities and HRA activities. The business - type activities of the City of St. Anthony, Minnesota include the operation of water and sewer utilities and the municipal off -sale liquor stores. The government -wide financial statements include not only the City of St. Anthony, Minnesota itself (known as the primary government), but also a legally separate Housing and Redevelopment Authority (HRA) for which the City of St. Anthony, Minnesota is financially accountable. The HRA functions for all practical purposes as a department of the City of St. Anthony, Minnesota, and therefore has been included as an integral part of the primary government. The government -wide financial statements can be found on Statements 1 and 2 of this report Fund financial statements. Afund is a grouping of related accounts that are used to maintain control over resources that have been segregated for specific activities or objectives. The City of St. Anthony, Minnesota, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance -related legal requirements. All of the funds of the City of St. Anthony, Minnesota can be divided into two categories: governmental funds and proprietary funds. Governmental funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government -wide financial statements. However, unlike the government -wide financial statements, governmental fund financial statements focus on near-term inflows and ouflows ofspendable resources, as well as on balances ofspendable resources available at the end of the fiscal year. Such information may be useful in evaluating a City's near-term financing requirements. Because the focus of governmental funds is narrower than that of the government -wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government -wide financial statements. By doing so, readers may better understand the long-term impact of the City's near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balance provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. 14 The City of St. Anthony, Minnesota maintains 33 individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures and changes in fund balance for the General, Street Improvement Debt Service, HRA Debt Service, Street Improvement Projects, HRA Projects, Storm Water Improvement, Silver Lake Road Project, 2009 Road Improvement Project and the 2011 Street Improvement Project, all of which are considered to be major funds. Data from the other 23 governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these non -major governmental funds is provided in the form of combining and sub -combining statements and schedules elsewhere in this report. The City of St. Anthony, Minnesota adopts an annual appropriated budget for its General Fund. A budgetary comparison statement has been provided for the General Fund to demonstrate compliance with this budget. The basic governmental fund financial statements can be found on Statements 3 through 5 of this report. Proprietary funds. The City of St. Anthony, Minnesota maintains two different types of proprietary funds. Enterprise funds are used to report the same functions presented as business - type activities in the government -wide financial statements. The City of St. Anthony, Minnesota uses enterprise funds to account for its water and sewer and municipal liquor operations. Internal service funds are an accounting device used to accumulate and allocate costs internally among the City of St. Anthony, Minnesota's various functions. The City of St. Anthony, Minnesota uses an internal service fund to account for its compensated absences. Because these services predominantly benefit governmental rather than business -type functions, they have been included within governmental activities in the government -wide financial statements. Proprietary funds provide the same type of information as the government -wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for the water and sewer and municipal liquor operations, which are considered to be major funds of the City of St. Anthony, Minnesota. The basic proprietary fund financial statements can be found on Statements 6 through 8 of this report. Notes to the financial statements. The notes provide additional information that is essential to a full understanding of the data provided in the government -wide and fund financial statements. The notes to the financial statements can be found following Statement 9 of this report. The combining statements referred to earlier in connection with non -major governmental funds are presented immediately following the required supplementary information on budgetary comparisons. Combining and individual fund statements and schedules can be found on Statements 12 through 19 of this report. 15 L. Government -wide Financial Analysis As noted earlier, net assets may serve over time as a useful indicator of a City's financial position. In the case of the City of St. Anthony, Minnesota, assets exceeded liabilities by $23,665,941 at the close of the most recent fiscal year. As part of the City's implementation of GASB 54, the Water Filtration Fund was reclassified from a Governmental Fund to an Enterprise Fund. This classification transferred $5,183,068 in net assets from Governmental Funds net assets to Business type. This in tum reduced the unrestricted portion of net assets available in Governmental Funds. Furthermore, TIF revenue bonds were previously treated as Invested in Capital Assets net of related debt in prior years. The City's TIF revenue bonds proceeds were used for infrastructure projects for business type activities funds and for economic development expenses. Since these expenditures are not part of Governmental Fund net assets a reclassification of Invested in capital assets net of related debt has been reflected for the financial statements. The resulting unrestricted net assets of ($6,358,682) are substantially the result of these reclassifications. The City continues to receive significant tax increment revenues to support the retirement of TIF related debt. Therefore, the unrestricted net assets will increase with the retirement of related debt. Again, the City's overall increase in the net assets for 2011 was $889,505. City of St. Anthony, Minnesota's Net Assets (A) Restated for reclassification of the Water Filtration and Purification Fund from governmental activities to business -type activities during 2011. The City's net assets increased by $889,505 during the current fiscal year. The key element for the increase was a decrease in expenses relating to general government and realizing an increase in charges for services. 16 Governmental Activities Business -Type Activities Totals 2011 2010 (A) 2011 2010'A' 2011 2010 Current and other assets $11,327,971 $14,745,729 $6,385,479 51,201,174 $17,713,450 $15,946,903 Capital assets 38,491,466 37,751,834 6,407,233 6,740,905 44,898,699 44,492,739 Total assets $49,819,437 $52,497,563 $12,792,712 57,942,079 562,612,149 $60,439,642 Long term liabilities outstanding 523,243,190 $30,657,410 $1,667,389 $1,767,701 524,910,579 532,625,111 Other liabilities 13,320,188 4,474,550 715,441 522,479 14,035,629 4,997,029 Total liabilities $36,563,378 535,331960 52382,830 52,290180 538,946,208 537,622,140 Net assets: Invested in capital assets net of related debt $15,334,754 $14,098,233 $4,767,233 54,915,905 $20,101,987 $19,014,138 Restricted 4,279,987 4,407,191 - 120,000 4,279,987 4,527,191 Unrestricted (6,358,682) (6,522,889) 5,642,649 5,799,062 (716,033) (723,827) Total net assets 513,256,059 $11,982,535 $10,409,882 $10,834,967 523,665,941 %22,817,502 (A) Restated for reclassification of the Water Filtration and Purification Fund from governmental activities to business -type activities during 2011. The City's net assets increased by $889,505 during the current fiscal year. The key element for the increase was a decrease in expenses relating to general government and realizing an increase in charges for services. 16 City of St. Anthony, Minnesota's Changes in Net Assets (A) Revenues: Program revenue: Charges for services Operating grants and contributions Capital grants and contributions General revenue: Property taxes Other taxes Grants and contributions not restricted to specific programs Other Total revenues Expenses: General government Public safety Public works Parks and recreation Services to other cities Housing and redevelopment Interest on long-term debt Liquor Water Water Filtration and Purification Sewn Total expenses Excess before transfers Transfers Governmental Activities Business -Type Activities Totals 2011 2010 2011 2010 2011 2010 51,983,731 454,841 839,137 4,872,840 1,746,766 $1,974,252 58,573,676 58,402,415 510,557,407 $10,376,667 475,411 - - 454,841 475,411 992,511 - - 839,137 992,511 4,750,440 1,807,388 4,872,840 4,750,440 1,746,766 1,807,388 24,673 22,827 - - 24,673 22,827 155,303 86,944 56,635 202,733 211,938 289,677 10,077,291 10,109,773 8,630,311 8,605,148 18,707,602 18,714,921 - (41,066) 96,671 Net assets- January, as restated 11,913,217 10,603,382 1,052,821 1,203,472 - - 1,052,821 1,203,472 2,971,316 2,898,043 - - 2,971,316 2,898,043 1,834,066 1,804,779 - - 1,834,066 1,804,779 457,822 440,858 - - 457,822 440,858 1,039,009 1,016,479 - - 1,039,009 1,016,479 671,934 654,145 - - 671,934 654,145 1,302,681 1,290,844 - - 1,302,681 1,290,844 - - 6,537,271 6,360,985 6,537,271 6,360,985 - - 839,785 826,352 839,785 826,352 - - 132,981 143,031 132,981 143,031 978,411 956,635 978,411 956,635 9,329,649 9,308,620 8,488,448 8,287,003 17,818 097 17,595,623 747,642 801,153 141,863 318,145 889,505 1,119,298 595,200 578,000 (595,200) (578,000) Increase (decrease) in net assets 1,342,842 1,379,153 (453,337) (259,855) 889,505 1,119 298 Net assets - January, as previously reported 11,982,535 10,506,711 10,834,967 11,094,822 22,817,502 21,601,533 Prior period adjustment (69,318) 96,671 28,252 - (41,066) 96,671 Net assets- January, as restated 11,913,217 10,603,382 10,863,219 11,094 822 22,776,436 21,698,204 Net assets -December 31 $13,256,059 SI 1,982,535 510,409,882 510,834,967 523,665,941 522,817,502 (A) Restated for reclassification of the Water Filtration and Purification Fund from governmental activities to business -type activities during 2011. 17 Governmental Activities. Governmental activities increased the City of St. Anthony's net assets by $1,342,842. The key element for the increase was the decrease in expenses relating to general government and realizing an increase in charges for services. Revenues by Source Governmental Grants and Activities contributions not restricted to specific programs Other Charges for Tax increments° • 1.5% services 19.7% 17.4% Operating grants and contributions 4.5% Capital grants and contributions 8.3% Property taxes 48.4% For the most part, increases in expenses closely paralleled inflation and growth in the demand for services. 18 Business -type activities. Business -type activities decreased net assets by $453,337. The key factor for the decrease was that charges for sewer are not sufficient to cover depreciation. Rate increases for all utility services were made for 2012 billings. Revenues by Source - Business -Type Activities Miscellaneous 1% Charges for services 99% Financial Analysis of the City's Funds As noted earlier, the City of St. Anthony uses fund accounting to ensure and demonstrate compliance with finance -related legal requirements. Governmental funds. The focus of the City of St. Anthony, Minnesota's governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City of St. Anthony, Minnesota's financing requirements. As of the end of the current fiscal year, the City of St. Anthony, Minnesota's governmental funds reported combined ending fund balances of $8,305,131, an increase of $1,851,615 in comparison with the prior year restated amounts. The ending fund balance by GASB 54 designation is as follows: Nonspendable $55,403 Restricted 6,868,120 Committed 210,953 Assigned 763,667 Unassigned 406,988 Total $8,305,131 19 L The General Fund is the chief operating fund of the City of St. Anthony, Minnesota. At the end of the current fiscal year, unassigned fund balance of the General Fund was $1,647,566, while total fund balance reached $1,702,837. As a measure of the General Fund's liquidity, it may be useful to compare both unassigned fund balance and total fund balance to total fund expenditures. Unassigned fund balance represents 30.7% of total General Fund expenditures and total fund balance represents 31.8% of that same amount. During the current fiscal year, the fund balance in the General Fund increased by $78,137. The Street Improvement Debt Service Fund increased by $2,241,362 as debt was refinanced near year end and proceeds were being held for payments of debt in early 2012. The HRA Debt Service Fund increased by $20,261 as annual revenue collected and transfers in was more than annual debt service requirements. The Street Improvement Projects Fund decreased by $1,256,727 substantially due to the payoff of the Fannie Mae debt of $1,250,000. This debt was associated with Apache Plaza area land acquisition associated with the Silver Lake Village Development. The HRA Projects Funds increased by $291,084 to a balance of $776,143. The key factor in the increase was that Tax Increment revenue exceed debt related payment by $322,730. The Storm Water Improvement Fund increased by $17,528 due to charges for services exceeding operating expenses. The 2009 Street Improvement Project Fund decreased by $46,525 as a result of payments to contractors and pending final construction expenses. The 2011 Street Improvement Project Fund increased by $351,212 as a result of bonds issued. Non -major Special Revenue Funds decreased by $57,737 to a balance of ($27,468) due to greater activity in the area of Housing and Redevelopment. Non -major Debt Service Funds had a total fund balance of $1,386,671, all of which is reserved for the payment of debt service. The net increase in fund balance during the current year in the non -major debt service funds was $344,711, of which $211,695 represents the addition of the 2011 Street Bond Fund. Non -major Capital Project Funds had a total fund balance of ($25,791), a decrease of $131,691 20 Proprietary funds. The City of St. Anthony, Minnesota's proprietary funds provide the same type of information found in the government -wide financial statements, but in more detail. Unrestricted net assets in the Liquor Operations and Water and Sewer Funds at the end of the year amounted to $5,642,649. The total net assets for each fund were: Liquor— $2,168,070; Water and Sewer— $8,241,812. General Fund Budgetary Highlights Variances from actual to budget can be briefly summarized as follows: • Licenses and permits were $50,937 less than budget due to construction related permits being $50,319 less than anticipated. • Fire State Aid was less than budget by $19,926 but consistent with the amount received for 2010. State Aid is based on insurance premiums paid. Fire State aid budget for 2012 was reduced to $35,700. • Investment income was $20,411 less than budget because rates were significantly lower than prior years and substantial funds were held in money market funds. • Miscellaneous revenues were $54,430 more than budget due to reimbursements of development related costs. • Police protection — personnel services were $54,212 less than budget due to less overtime incurred. • Protective Inspections were $29,136 less than budget as contracted services required were less given reduction in construction permit activity. • Street maintenance personnel services costs were $15,525 greater than budget. However, these costs were consistent with 2010 actual costs. The same comment would apply other services and charges. • Parks and recreation personnel services costs were $11,603 less than budget due to a reallocation of the salaries while the Public Works Director was Acting City Manager. Capital Asset and Debt Administration Capital Assets. The City of St. Anthony, Minnesota's investment in capital assets for its governmental and business -type activities as of December 31, 2011 amounts to $44,898,679 (net of accumulated depreciation). This investment in capital assets includes land, buildings and structures, improvements, machinery and equipment, park facilities, roads and infrastructure. The total increase in the City of St. Anthony, Minnesota's investment in capital assets for the current fiscal year is 0.9%. 21 L. Major capital asset events during the current fiscal year included the following: • The annual street reconstruction and infrastructure improvement project was added. Land Land improvement Buildings and structures Furniture and fixtures Software intangibles Infrastructure/streets Storm sewers Storm water Less accumulated depreciation Construction in progress Total City of St. Anthony, Minnesota's Capital Assets Governmental Activities Business -Type Activities Totals 2011 2010 2011 2010 2011 2010 $3,378,842 $3,378,842 $5,653 $5,653 $3,384,495 $3,384,495 874,059 874,059 - - 874,059 - 9,836,936 9,829,307 3,883,283 3,883,283 13,720,219 13,712,590 3,370,246 3,084,943 1,441,074 1,433,610 4,811,320 4,518,553 - - 26,022 26,022 26,022 26,022 29,257,164 20,808,158 6,797,401 6,797,401 36,054,565 27,605,559 428,469 428,469 - - 428,469 428,469 1,468,902 1,468,902 - - 1,468,902 - (12,096,465) (10,655,029) (5,746,200) (5,405,064) (17,842,665) (16,060,093) 1,973,293 8,534,183 - 1,973,293 8,534,183 $38,491,446 $37,751,834 $6,407,233 $6,740,905 $44,898,679 $42,149,778 Additional information on the City of St. Anthony, Minnesota's capital assets can be found in Note 4. Long-term debt. At the end of the current fiscal year, the City of St. Anthony, Minnesota had total debt outstanding of $36,947,574. Of this amount, $25,116,030 comprises debt backed by the full faith and credit of the City, $9,345,000 is backed by tax increments, $1,640,000 is backed by revenues sources from the City of St. Anthony, Minnesota's enterprise funds. The remainder of the City of St. Anthony, Minnesota's debt represents the liability for compensated absences. City of St. Anthony, Minnesota's Outstanding Debt General Obligation and Revenue Bonds General obligation bonds General obligation: Fannie Mae loan payable G.O. revenue bonds Revenue bonds Issuance premiums (discounts) Compensated absences Total Governmental Activities Business -Type Activities Totals 2011 2010 2011 2010 2011 2010 $20,575,000 $17,765,000 $20,575,000 $17,765,000 - 1,250,000 - - - 1,250,000 4,675,000 5,030,000 1,640,000 1,730,000 6,315,000 6,760,000 8,975,000 9,165,000 - 95,000 8,975,000 9,260,000 236,030 150,896 - - 236,030 150,896 703,122 691,339 143,422 146,140 846,544 837,479 $35,164,152 $34,052,235 $1,783,422 $1,971,140 $36,947,574 $36,025,385 22 The City of St. Anthony's total bonded debt increased by $2,080,000 (6.2%) during the current fiscal year. The key factors in this increase were; 1) pay off/refunding of the 2003A G.O. Road Improvement Bond totaling $1,135,000; 2) principal retirement of $1,950,000; 3) issuance of the 2011A $2,955,000 G.O. Road Improvement Bonds; and 4) issuance of the 201113$2,210,000 G.O. Road Improvement Bonds. The City of St. Anthony, Minnesota maintains an "AA" rating from Standard and Poor's for general obligation debt. State statutes limit the amount of general obligation debt the City may issue to 3% of its total market value. The current debt limitation for the City of St. Anthony, Minnesota is $22,184,277, which is in excess of the City of St. Anthony, Minnesota's $5,820,000 outstanding general obligation debt, excluding tax increment, special assessment, and HRA bonds. Additional information on the City of St. Anthony, Minnesota's long-term debt can be found in Note 5. Economic Factors and Next Year's Budgets and Rates • Healthy financial profile with a stable outlook including a very strong general fund balance. • Strong income and wealth indicators relative to national levels. • The stable outlook reflects expectations that St. Anthony will continue to maintain balanced operations. • Good management practices, including extensive financial planning to maintain acceptable service levels while being sensitive to increases in property taxes remains the most significant challenge. These factors were considered in preparing the City of St. Anthony, Minnesota's budget for the 2011 fiscal year. In 2010, to comply with a State of Minnesota mandate and promote conservation, tiered water rates were implemented for all users. In addition, sewer rates were increased from $3.30 per 1,000 gallons to $3.50 per 1,000 gallons. The revenue from water and sewer operations totaled $1,577,753, which was less than expenditures by $302,102 (19%). Analysis and monitoring of the impact of tiered water rates and the sewer rate increase will be on-going. Rate increases were enacted in 2012 and future rates are likely to address infrastructure improvements. Requests for Information This financial report is designed to provide a general overview of the City of St. Anthony, Minnesota's finances for all those with an interest in the government's finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Office of the Finance Director, City of St. Anthony, Minnesota, 3301 Silver Lake Road, St. Anthony, Minnesota, 55418. 23 1 _ - This page intentionally left blank - 24 BASIC FINANCIAL STATEMENTS 25 - This page intentionally left blank - 26 I I CITY OF ST. ANTHONY, MINNESOTA STATEMENT OF NET ASSETS December 31, 2011 With Comparative Totals For December 31, 2010 Assets: Cash and investments Restricted cash and investments Funds held in trust Accrued interest Due from other governmental units Internal balances Accounts receivable - net Prepaid items Property taxes receivable Special assessments receivable Funds held for others Inventories - at cost Deferred charges Land held for resale Capital assets - net: Nondepreciable Depreciable Total assets Liabilities: Accounts payable Contracts payable Deposits payable Due to other governmental units Salaries payable Accrued interest payable Compensated absences payable: Due within one year Due in more than one year Bonds and notes payable (net of unamortized premiums and discounts): Due within one year Due in more than one year Other post employment benefits: Due in more than one year Total liabilities Net assets: Invested in capital assets, net of related debt Restricted for: Debt service Public safety Unrestricted Total net assets Statement 1 The accompanying notes are an integral part of these financial statements. 27 L Primary Government Governmental Business -Type Totals Activities Activities 2011 2010 $7,547,261 $3,053,155 $10,600,416 $10,873,621 2,164,079 2,164,079 156,163 438,161 - 438,161 438,163 255 12,936 13,191 16,432 76,773 - 76,773 34,503 (2,110,490) 2,110,490 - - 72,534 440,419 512,953 504,945 55,403 28,911 84,314 86,881 180,241 - 180,241 78,008 1,732,227 1,732,227 1,762,304 91,018 - 91,018 160,000 - 707,010 707,010 756,838 480,529 32,558 513,087 479,045 600,000 - 600,000 600,000 5,352,135 5,653 5,357,788 11,918,678 33,139,311 6,401,580 39,540,891 32,574,061 49,819,437 12,792,712 62,612,149 60,439,642 218,919 309,461 528,380 211,594 248,093 - 248,093 109,004 2,483 88,550 91,033 118,553 6,269 83,895 90,164 231,990 152,999 51,986 204,985 197,299 561,819 28,254 590,073 560,352 235,895 58,295 294,190 249,266 467,227 85,127 552,354 588,213 11,893,711 95,000 11,988,711 3,318,968 22,567,319 1,545,000 24,112,319 31,866,928 208,644 37,262 245,906 169,973 36,563,378 2,382,830 38,946,208 37,622,140 15,334,754 4,767,233 20,101,987 19,014,138 4,263,706 - 4,263,706 4,492,871 16,281 - 16,281 34,320 (6,358,682) 5,642,649 (716,033) (723,827) $13,256,059 $10,409,882 $23,665,941 $22,817,502 The accompanying notes are an integral part of these financial statements. 27 L CITY OF ST. ANTHONY, MINNESOTA STATEMENT OF ACTIVITIES For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Functions/Proerams Expenses Primary government: 839,785 Governmental activities: 132,981 General government $1,052,821 Public safety 2,971,316 Public works 1,834,066 Parks and recreation 457,822 Services to other cities 1,039,009 Housing and redevelopment 671,934 Interest on long-term debt 1,302,681 Total governmental activities 9,329,649 Business -type activities Liquor 6,537,271 Water 839,785 Water Filtration and Purification 132,981 Sewer 978,411 Total business -type activities 8,488,448 Total primary government $17,818,097 The accompanying notes are an integral part of these financial statements. 28 Charges For Services $269,747 131,620 176,922 225,108 1,180,334 1,983,731 6,995,923 798,240 779,513 8,573,676 $10,557,407 Statement 2 General revenues: General property taxes Tax increment taxes Grants and contributions not restricted to specific programs Unrestricted investment earnings Other Transfers Total general revenues and transfers 4,872,840 1,746,766 4,872,840 4,750,440 1,746,766 1,807,388 24,673 - 24,673 Net (Expense) Revenue and 6,803 Program Revenues 59,462 Changes in Net Assets 3,976 Operating Capital 595,200 Primary Government - Grants and Grants and Governmental Business -Type Totals $10,409,882 Contributions Contributions Activities Activities 2011 2010 $9,560 $ - ($773,514) $ - ($773,514) ($933,645) 300,994 25,972 (2,512,730) - (2,512,730) (2,419,317) 133,321 813,165 (710,658) - (710,658) (510,857) - - (232,714) - (232,714) (220,869) - 141,325 - 141,325 140,711 - - (671,934) - (671,934) (639,145) 10,966 - (1,291,715) - (1,291,715) (1,283,324) 454,841 839,137 (6,051,940) 0 (6,051,940) (5,866,446) - - 458,652 458,652 465,916 (41,545) (41,545) (40,710) (132,981) (132,981) (143,031) - - (198,898) (198,898) (166,763) 0 0 0 85,228 85,228 115,412 $454,841 $839,137 (6,051,940) 85,228 (5,966,712) (5,751,034) General revenues: General property taxes Tax increment taxes Grants and contributions not restricted to specific programs Unrestricted investment earnings Other Transfers Total general revenues and transfers 4,872,840 1,746,766 4,872,840 4,750,440 1,746,766 1,807,388 24,673 - 24,673 22,827 6,803 52,659 59,462 224,357 148,500 3,976 152,476 65,320 595,200 (595,200) - - 7,394,782 (538,565) 6,856,217 6,870,332 Change in net assets ( 1,342,842 (453,337) 889,505 1,119,298 Net assets - January 1, as previously reported 11,982,535 10,834,967 22,817,502 21,601,533 Prior period adjustment (69,318) 28,252 (41,066) 96,671 Net assets - January 1, as restated 11,913,217 10,863,219 22,776,436 21,698,204 Net assets - December 31 $13,256,059 $10,409,882 $23,665,941 $22,817,502 The accompanying notes are an integral part of these financial statements. L i 29 CITY OF ST. ANTHONY, MINNESOTA BALANCESHEET GOVERNMENTALFUNDS December 31, 2011 The accompanying notes are an integral part of these financial statements. 30 345/503 Street 325/311/312/335/ 504/340 Street 101/900 General improvement Debt 336 HRA Debt Improvement Fund Service Service Projects Assets Cash and investments $1,314,738 $1,265,668 $521,554 $354,111 Funds held in trust - - 437,465 - Restricted cash - 2,164,079 - - Accrued interest - - 6 _ Due from other governmental units 22,512 - - - Interfundreceivable 420,091 - - - Accounts receivable -net 50,896 - - - Prepaid items 55,271 - - - Property taxes receivable: Delinquent 47,496 15,239 6,921 - Due from county 20,664 7,120 2,603 - Special assessments receivable 25,074 1,170,130 - - Funds held by others - - _ - Land held for resale 600,000 Total assets $1,956,742 $4622,236 $968,549 $954,111 Liabilities and Fund Balance Liabilities: Accounts payable $47,712 $ - $ - $ - Contracts payable - Interfund payable - Deposits payable - Interfund loan payable - - 437,430 600,000 Due to other governmental units 6,197 - - - Salaries payable 152,469 - - Deterred revenue 47,527 1,179,400 6,921 Total liabilities 253,905 1,179,400 444,351 600,000 Fund balance: Nonspendable 55,271 - - - Restricted - 3,442,836 524,198 - Committed _ _ _ _ Assigned - - - 354,111 Unassigned 1,647,566 Total fund balance 1,702,837 3,442,836 524,198 354,111 Total liabilities and fund balance $1,956,742 $4,622,236 $968,549 $954,111 The accompanying notes are an integral part of these financial statements. 30 Statement 3 321/326/330/319/ 320 HRA Projects 702 Storm Water Improvement 360 Silver Lake Road Project Fund 5112009 Street Improvement Project Fund 515 2011 Street Improvement Project Fund Other Governmental Funds Intra -Activity Eliminations Total Governmental Funds - 210,953 - 9,798 544 - 189,591 209,623 - 763,667 (813,009) (28,339) - (399,230) - 406,988 2011 $1,868,089 $12,445 $544 $56,725 $308,712 $1,770,410 $ - $7,472,996 696 - - - - - - 438,161 38,491,446 Other long-term assets are not available to pay for current -period expenditures and, therefore, are deferred in the funds. - - 2,164,079 therefore are not reported in the funds. - 249 - 255 - 353 - - 43,908 10,000 - 76,773 $13,256,059 - - (420,091) - _ - 21,638 - 72,534 _ _ _ _ - 132 - 55,403 61,874 _ _ - - 9,230 - 140,760 4,745 - - - - 4,349 - 39,481 _ _ - - - 537,023 - 1,732,227 91,018 - - - - - - 91,018 _ - - 600,000 $2,026.422 $12,798 $544 $56,725 $352,620 $2,353,031 ($420,091) $12,883,687 $67,051 $3,000 $ - $ - $ - $101,156 $ - $218,919 - - - 85,064 163,029 - - 248,093 118,871 - - - - 301,220 (420,091) - 2,483 - - - - - - 2,483 1,000,000 - - - - 73,060 - 2,110,490 - 72 - 6,269 - 530 - 152,999 61,874 - 543,581 - 1,839,303 1,250,279 3,000 0 85,064 163,029 1,019,619 (420,091) 4,578,556 _ _ _ - - 132 - 55,403 1,498,134 - - - - 1,402,952 - 6,868,120 91,018 - - - - 119,935 - 210,953 - 9,798 544 - 189,591 209,623 - 763,667 (813,009) (28,339) - (399,230) - 406,988 776,143 9,798 544 (28,339) 189,591 1,333,412 0 8,305,131 $2,026,422 $12,798 $544 $56,725 $352,620 $2.353,031 ($420,091) $12,883,687 Fund balance reported above $8,305,131 Amounts reported for governmental activities in the statement of net assets are different because: Capital assets used in governmental activities are not financial resources, and therefore, are not reported in the funds. 38,491,446 Other long-term assets are not available to pay for current -period expenditures and, therefore, are deferred in the funds. 1,839,303 Long -tem liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported in the funds. (34,750,964) Internal service funds are used by management to charge the cost of employee vacation and severance to individual funds. The assets and liabilities are included in the governmental activities on the statement of net assets (628,857) Net assets of governmental activities $13,256,059 The accompanying notes are an integral part of these financial statements. 31 CITY OF ST. ANTHONY, MINNESOTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE GOVERNMENTALFUNDS For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Revenues: General property taxes Tax increment collections Licenses, fees and permits Intergovernmental Special assessments Charges for services Cable franchise fees Fines and forfeits Investment income Contributions and donations Miscellaneous Total revenues Expenditures: Current: General government Public safety Public works Parks and recreation Services to other cities Nondepartmental Housing and redevelopment Capital outlay: General government Public safety Public works Debt service: Principal Interest Paying agent fees Professional service Issuance costs Construction/acquisition costs Developer incentives Total expenditures Revenues over (under) expenditures Other financing sources (uses): Bonds issued Refunding bonds issued Redemption of refunded bonds Premium on debt issued Sale of capital assets Transfers in Transfers out Total other financing sources (uses) Net change in fund balance Fund balance - January 1 Prior period adjustment Fund balance - January 1, as restated Fund balance - December 31 345/503 Street 325/311/312/335 504/340 Street 321/326/330/319 101/900 General Improvement /336 HRA Debt Improvement /320 HRA Fund Debt Service Service Projects Projects $2,925,430 $893,780 $404,987 $ - $ - - - - - 1,708,873 195,563 - - - _ 391,093 - - - 12,781 - 324,388 - - - 1,261,824 - 96,608 107,053 89 63 70 33 152 610 _ 105,460 336 5,083,730 1,218,231 405,057 33 1,722,142 747,553 - 1,155 - 2,671,817 - - - 669,582 - - - 209,049 - - - 1,039,009 - - - 22,283 - - - - 800,000 590,000 1,250,000 - 330,055 652,274 6,760 - 3,958 5,978 - - 16,909 8,710 - - 67,278 - 44,915 - - - 444,013 5,359,293 1,218,200 1,258,117 1,256,760 488,928 (275,563) 31 (853,060) (1,256,727) 1,233,214 3,225,000 - (1,030,000) - 46,331 419,800 - 873,321 - (66,100) (942,130) 353,700 2,241,331 873,321 0 (942,130) 78,137 2,241,362 20,261 (1,256,727) 291,084 1,624,700 1,201,474 503,937 1,610,838 554,377 - - (69,318) 1,624,700 1,201,474 503,937 1,610,838 485,059 $1,702,837 $3,442,836 $524,198 $354,111 $776,143 The accompanying notes are an integral part of these financial statements. 32 Statement 4 702 Storm 360 Silver Lake 5112009 Street 515 2011 Street Other Water Road Project Improvement Improvement Governmental Intra -Activity Improvement Fund Project Fund Project Fund Funds Eliminations Total Governmental Funds - 193,290 - 517,678 398,895 2011 2010 $653,071 S - $4,877,268 $4,787,076 - - 1,708,873 1,911,678 - - - 195,563 224,096 _ - - 43,908 413,962 - 861,744 1,239,053 - 193,290 - 517,678 398,895 23,607 - - - 288,544 - 1,573,975 1,528,210 _ _ _ - - 96,608 92,786 10,782 - 117,835 128,165 - - 5 66 6,314 - 6,792 24,983 - - 610 2,834 42,704 148,500 708,181 23,607 0 5 43,974 1,608,667 0 10,105,446 11,045,957 - 89,855 - 883,478 1,063,903 _ _ - - 28,511 - 2,700,328 2,615,752 6,079 - - - 9,100 - 684,761 689,760 - - - - 157,104 - 366,153 388,808 - - 1,039,009 1,016,479 - - 22,283 6,940 - 227,921 - 227,921 183,513 - 12,661 - 12,661 - _ - 152,405 - 152,405 67,850 - 112,158 - 112,158 212,029 - - 480,000 - 3,120,000 4,255,000 - - 282,460 - 1,271,549 1,392,608 - 1,646 - 11,582 8,763 - - 4,490 - 30,109 3,117 _ - - - 67,278 - _ - 46,530 1,639,126 268,267 - 1,953,923 2,420,767 105,598 402 444,013 470,632 6,079 0 46,530 1,639,126 1,826,578 0 13,099,611 14,795,921 17,528 0 (46,525) (1,595,152) (217,911) 0 (2,994,165) (3,749,964) - - - 1,887,097 52,903 - 1,940,000 1,375,000 - - - 3,225,000 - _ - - - (1,030,000) - _ - - 59,267 - - 105,598 402 - - - 9,982 - 9,982 15,347 - - - 310,309 (1,008,230) 595,200 578,000 ,008,230 0 0 0 1,946,364 373,194 0 4,845,780 1,968,749 17,528 0 (46,525) 351,212 155,283 0 1851,615 (1,781,215) (7,730) 544 18,186 (161,621) 1,178,129 - 6,522,834 8,207,378 (69,318) 96,671 (7,730) 544 18,186 (161,621) 1,178,129 0 6,453,516 8,304,049 $9,798 5544 ($28,339) $189,591 51333,412 s0 $5305,131 $6,522,834 The accompanying notes are an integral part of these financial statements. 33 L CITY OF ST. ANTHONY, MINNESOTA RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTALFUNDS For The Year Ended December 31, 2011 With Comparative Amounts For The Year Ended December 31, 2010 Amounts reported for governmental activities in the statement of activities (statement 2) are different because: Net changes in fund balances - total governmental funds (statement 4) Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlays exceeded depreciation in the current period. The net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins and donations) is to decrease net assets, as follows: Book value of disposals Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds. The issuance of long-term debt (e.g., bonds, leases) provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net assets. This amount is the net effect of these differences in the treatment of long-term debt and related items. Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. Internal Service Funds are used by management to charge the cost of severance expense to individual funds. This amount is the net income attributable to governmental activities. Change in net assets of governmental activities (statement 2) 34 Statement 5 2011 2010 $1,851,615 ($1,824,631) 755,975 1,284,219 (16,363) (52,652) (28,166) (938,354) (1,184,327) 2,811,523 28,711 89,699 (64,603) (34,067) $1,342,842 $1,335,737 CITY OF ST. ANTHONY, MINNESOTA STATEMENT OF NET ASSETS 12,936 Statement 6 PROPRIETARY FUNDS 1,468 438,951 December 31, 2011 453,850 - 10,982 With Compamtvie Totals For December 31, 2010 28,911 29,297 - 707,010 1,433,610 Governmental 756,838 - Business -Type Activities Enterprise Funds Activities - 5,104,551 701n04 Water Internal Service - 705 Liquor and Sewer Totals Fund Assets: 2011 2010 9,840,884 Current assets: Cash and cash equivalents Restricted cash and cash equivalents Due from other governmental units Interfund loan receivable - current portion Receivables: Interest Accounts Prepaid items Inventories - at cost Total current assets Noncurrent assets: Interfund loan receivable - noncurrent portion Deferred charges Capital assets: Land Buildings and stmctures Furniture, fixtures and equipment Distribution and collection system Software intangibles Total capital assets Less: Allowance for depreciation Net capital assets Total noncurrent assets Total assets Liabilities: Current liabilities: Interfund payable Accounts payable Due to other governmental units Salaries payable Accmed interest payable Refundable deposits Compensated absences payable - current portion Bonds and notes payable - current portion Interfund loan payable - current portion Total current liabilities Noncurrent liabilities: Compensated absences payable - noncurrent portion Bonds and notes payable - noncurrent portion Interfund loan payable - noncurrent portion Other post employement benefits Total noncurrent liabilities Total liabilities $487,028 $2,566,127 $3,053,155 $2,943,143 $74,265 - - - 156,163 - 900 862,120 862,120 - 12,936 12,936 16,425 - 1,468 438,951 440,419 453,850 - 10,982 17,929 28,911 29,297 - 707,010 1,433,610 707,010 756,838 - 1,206,488 3,898,063 5,104,551 4,356,616 74,265 1,357,870 1,357,870 2,262,110 - - 32,558 32,558 37,759 - - 5,653 5,653 5,653 - 1,875,328 2,007,955 3,883,283 3,883,283 - 411,200 1,029,875 1,441,075 1,433,610 - - 6,797,401 6,797,401 6,797,401 - 26,022 - 26,022 26,022 14,984 2,312,550 9,840,884 12,153,434 12,145,969 0 (792,898) (4,953,303) (5,746,201) (5,405,064) - 1,519,652 4,887,581 6,407,233 6,740,905 T- 1,519,652 6,278,009 7,797,661 9,040,774 0 2,726,140 10,176,072 12,902,212 13,397,390 74,265 - - - 92,659 - 272,279 37,182 309,461 55,390 - 78,346 5,549 83,895 81,779 - 27,069 24,917 51,986 46,716 - - 28,254 28,254 29,529 - - 88,550 88,550 114,152 - 14,984 43,311 58,295 43,497 235,895 - 95,000 95,000 185,000 - 36,500 - 36,500 36,500 - 429,178 322,763 751,941 685,222 235,895 35,874 49,253 85,127 102,643 467,227 - 1,545,000 1,545,000 1,640,000 - 73,000 - 73,000 109,500 - 20,018 17,244 37,262 25,058 128,892 1,611,497 1,740,389 1,977,201 467,227 558,070 1,934,260 2,492,330 2,562,423 703,122 Net assets: Invested in capital assets, net of related debt 1,519,652 3,247,581 4,767,233 4,915,905 - Restricted for debt service - - - 120,000 - Unrestricted 648,418 4,994,231 5,642,649 5,799,062 (628,857) Total net assets $2,168,070 $8,241,812 $10,409,882 $10,834,967 ($628,857) The accompanying notes are an integral part of these financial statements. 35 CITY OF ST. ANTHONY, MINNESOTA STATEMENT OF REVENUES, EXPENSES AND 679,925 1,362,824 Statement 7 CHANGES IN FUND NET ASSETS 92,104 443,960 408,589 - PROPRIETARY FUNDS 110,440 133,973 159,395 - For The Year Ended December 31, 2011 522,503 522,503 502,255 - With Comparatvie Totals For The Year Ended December 31, 2010 218,809 238,353 210,977 - 85,062 256,074 Governmental 330,113 - Business -Type Activities Enterprise Funds Activities - 3,042,749 701 /704 491,311 (302,102) 189,209 Water and Internal 705 Liquor Sewer Totals Service Fund 2011 2010 Sales $6,995,923 $ $6,995,923 $6,826,901 $ Cost of sales (5,341,718) - (5,341,718) (5,232,072) - Gross profit 1,654,205 0 1,654,205 1,594,829 0 Operating revenues: Customer billings Connection charges Total operating revenues Total gross profit and operating revenues Operating expenses: Personal services Supplies Contracted services Treatment charges (MCES) Other Depreciation Total operating expenses Operating income (loss) Nonoperating revenues (expenses): Investment income Interest expense Amortization of deferred charges Paying agent fees Gain on sale of capital assets Miscellaneous revenue Miscellaneous expense Total nonoperating revenues (expenses) Income (loss) before transfers Transfers: Transfers out Change in net assets Net assets - January I Prior period adjustment Net assets - January 1, as restated Net assets - December 31 1,577,753 1,577,753 1,574,664 - - - 850 0 1,577,753 1,577,753 1,575,514 0 1,654,205 1,577,753 3,231,958 3,170,343 682,899 679,925 1,362,824 1,347,216 64,614 351,856 92,104 443,960 408,589 - 23,533 110,440 133,973 159,395 - - 522,503 522,503 502,255 - 19,544 218,809 238,353 210,977 - 85,062 256,074 341,136 330,113 - 1,162,894 1,879,855 3,042,749 2,958,545 64,614 491,311 (302,102) 189,209 211,798 (64,614) 218 52,441 (12,763) (68,064) (2,549) (2,694) (564) 52,659 199,279 (80,827) (90,824) (5,243) (5,201) (564) (361) - 600 11 3,443 533 3,976 6,882 (17,347) - (17,347) (4,028) - (28,998) (18,348) (47,346) 106,347 11 462,313 (320,450) 141,863 318,145 (64,603) (417,200) (178,000) (595,200) (578,000) 45,113 (498,450) (453,337) (259,855) (64,603) 2,122,957 8,712,010 10,834,967 11,094,822 (564,254) - 28,252 28,252 - 2,122,957 8,740,262 10,863,219 11,094,822 (564,254) $2,168,070 $8,241,812 $10,409,882 $10,834,967 ($628,857) The accompanying notes are an integral part of these financial statements. 36 CITY OF ST. ANTHONY, MINNESOTA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS For The Year Ended December 31, 2011 Cash flows from operating activities: Receipts from customers and users Payment to suppliers Payment to employees Miscellaneous revenue Miscellaneous expense Net cash flows provided by (used in) operating activities Cash flows from noncapital financing activities: Transfer to General Fund Transfer to Capital Project Funds Change ininterfund receivable/payable Net cash flows provided by (used in) noncapital financing activities Cash flows from capital and related financing activities: Acquisition of capital assets Change in interfund loan receivable/payable Interest paid on interfund payable Principal paid on debt Interest paid on debt Net cash flows provided by (used in) capital and related financing activities Cash flows from investing activities: Investment income Net increase (decrease) in cash and cash equivalents Cash and cash equivalents - January 1 Cash and cash equivalents - December 31 Reconciliation of operating income (loss) to net cash provided (used) by operating activities: Operating income (loss) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Miscellaneous revenue Miscellaneous expense Depreciation Changes in assets and liabilities: Decrease (increase)in receivables Decrease (increase) in prepaid items Decrease (increase) in inventory Increase (decrease) in payables Total adjustments Net cash provided by operating activities Statement 8 Governmental Business -Type Activities Enterprise Funds Activities - 701/704 Water and Internal 705 Liquor Sewer Totals Service Fund 2011 $7,008,009 $1,579,998 $8,588,007 $ (5,412,838) (958,659) (6,371,497) - (671,609) (676,459) (1,348,068) (52,831) 3,443 533 3,976 - (17,347) - (17,347) - 909,658 (54,587) 855,071 (52,831) (291,800) (128,000) (419,800) (125,400) (50,000) (175,400) (15,609) (77,050) (92,659) (432,809) (255,050) (687,859) 0 (7,465) - (7,465) (36,500) 42,120 5,620 (7,300) - (7,300) (95,000) (90,000) (185,000) (5,463) (69,903) (75,366) (151,728) (117,783) (269,511) 1,344 54,804 56,148 11 326,465 (372,616) (46,151) (52,820) 160,563 2,938,743 3,099,306 127,085 $487,028 $2,566,127 $3,053,155 $74,265 $491,311 ($302,102) $189,209 ($64,614) 3,443 533 3,976 (17,347) - (17,347) 85,062 256,074 341,136 12,086 2,245 14,331 - 860 (474) 386 - 49,828 - 49,828 - 284,415 (10,863) 273,552 11,783 418,347 247,515 665,862 11,783 $909,658 ($54,587) $855,071 ($52,831) The accompanying notes are an integral part of these financial statements. 37 CITY OF ST. ANTHONY, MINNESOTA STATEMENT OF FIDUCIARY NET ASSETS FIDUCIARY FUND VETERAN'S MEMORIAL FUND December 31, 2011 With Comparative Totals For December 31, 2010 The accompanying notes are an integral part of these financial statements. 38 Statement 9 1107[1; $200 $200 $200 $200 2011 Asses: Cash and investments ($13,372) Accounts receivable - net 13,372 Total assets $0 Liabilities: Deposits payable $ _ Total liabilities $0 The accompanying notes are an integral part of these financial statements. 38 Statement 9 1107[1; $200 $200 $200 $200 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City of St. Anthony, Minnesota (the City) operates pursuant to applicable Minnesota laws and statutes under the council-manager plan (Statutory Plan B) as defined by State statutes. The government of the City is directed by a Council composed of an elected mayor and four other elected members. The Council exercises legislative authority and determines matters of policy. The Council appoints the City Manager who is responsible for the administration of all affairs relating to the City. The financial statements of the City have been prepared in conformity with generally accepted accounting principles as applied to governmental units by the Governmental Accounting Standards Board (GASB). The following is a summary of the significant accounting policies. A. FINANCIAL REPORTING ENTITY As required by generally accepted accounting principles, the financial statements of the reporting entity include those of the City (the primary government) and its component units. The component unit discussed below is included in the City's reporting entity because of the significance of their operational or financial relationships with the City. COMPONENT UNITS In conformity with generally accepted accounting principles, the financial statements of the component unit have been included in the financial reporting entity as a blended component unit. The Housing and Redevelopment Authority (HRA) is an entity legally separate from the City. However, for financial reporting purposes, the HRA is reported as if it were part of the City's operations because the members of the City Council serve as HRA board members and its activity is confined to the City. The City established the HRA under State statutes to assist and support housing and redevelopment projects undertaken within the City which are under the statutory authority of the HRA. The City reviews and approves tax levies and other financial matters related to the HRA. The City provides major financing of HRA activities and debt issued in connection with HRA projects are general obligations of the City. The activity of the HRA is reported in the HRA Debt Service Fund, the HRA Projects Fund and the HRA Special Revenue Fund. Separate financial statements are not prepared for the HRA. B. GOVERNMENT -WIDE AND FUND FINANCIAL STATEMENTS The government -wide financial statements (i.e., the statement of net assets and the statement of changes in net assets) report information on all of the nonfiduciary activities of the primary government and its component units. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business -type activities, which rely to a significant extent, on fees and charges for support. 39 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 The statement of activities demonstrates the degree to which the direct expenses of a given function or business -type activity is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or business -type activity. Program revenues include 1) charges to customers or applicants who purchase, use or directly benefit from goods, services or privileges provided by a given function or business -type activity; and, 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or business -type activity. Taxes and other items not included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds and proprietary funds. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. C. MEASUREMENT FOCUS, BASIS OF ACCOUNTING AND FINANCIAL STATEMENT PRESENTATION The government -wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. The City's only fiduciary fund is an agency fund. Agency funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the City considers all revenues, except property taxes and reimbursement grants, to be available if they are collected within 90 days of the end of the current fiscal period. Property taxes are considered available if they are collected within 60 days of the end of the current year. Reimbursement grants are considered available if they are collected within one year of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. Property taxes, special assessments, intergovernmental revenues, charges for services and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the City. 40 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 The City reports the following major governmental funds: The General Fund is the government's primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. The Street Improvement Debt Service Fund was established to account for debt associated with a systematic plan to reconstruct substandard residential streets and alleys. Annual debt service payments are funded through special assessments and tax levies. The HRA Debt Service Fund was established to account for debt associated with Tax Increment Financing Districts of the City. The Street Improvement Projects Fund was established to account for the construction costs for annual road reconstruction projects. The HRA Projects Fund was established to account for the construction and redevelopment costs within the City. The Storm Water Improvement Fund was established to account for the construction costs associated with the 100 -Year Flood Protection Project and related flooding issues. The Silver Lake Road Project Fund was established to account for the funding and costs of reconstruction for Silver Lake Road from 37`" Avenue NE to St. Anthony Boulevard. The 2009 Street Improvement Fund accounts for the construction costs associated with the reconstruction of Foss Road from Chandler Drive to the City limits. The 2011 Street Improvement Project Fund accounts for the street reconstruction and lighting improvements to Belden Drive, Coolidge Street, Harding Street and Edward Street. Sidewalk improvements will occur on W Avenue from Macalaster Drive to Silver Lake Road. The City reports the following major proprietary funds: The Liquor Fund is an enterprise fund that is used to account for operations of the City's off -sale liquor operation. The Water and Sewer Fund accounts for the water and sewer service charges which are used to finance the water and sewer system operating expenses, and the operation and maintenance of the City's water purification plant. Additionally, the City reports the following fund types: Internal Service Fund - the Severance Fund accounts for the liability the City has for employee vacation and severance payments. Agency Fund - the Veteran's Memorial Fund accounts for donations collected for other entities �. for the construction of the future Veteran's Memorial. 41 L. CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 As a general rule the effect of interfund activity has been eliminated from the government -wide financial statements. Exceptions to this general rule are transactions that would be treated as revenues, expenditures or expenses if they involved external organizations, such as buying goods and services or payments in lieu of taxes, are similarly treated when they involve other funds of the City. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. Amounts reported as program revenues include 1) charges to customers or applicants for goods, services or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the liquor, water and sewer enterprise funds are charges to customers for sales and services. Operating expenses for enterprise funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. When both restricted and unrestricted resources are available for an allowable use, it is the City's policy to use restricted resources first, then unrestricted resources as they are needed. D. BUDGETS Budgets are legally adopted on a basis consistent with generally accepted accounting principles. Annual appropriated budgets are legally adopted for the General and all Special Revenue Funds, except the Water Filtration and Purification Fund. Budgeted expenditure appropriations lapse at year end. Encumbrance accounting, under which purchase orders, contracts and other commitments for the expenditure of monies are recorded in order to reserve that portion of the appropriation, is not employed by the City because it is at present not considered necessary to assure effective budgetary control or to facilitate effective cash management. E. LEGAL COMPLIANCE - BUDGETS The City follows these procedures in establishing the budgetary data reflected in the financial statements: 1) The City Manager submits to the City Council a proposed operating budget for the upcoming year in August. The operating budget includes proposed revenues and expenditures and the operating levy associated with operations. 2) The City Council and staff meet to review the proposed budget and Council recommends any appropriate changes. 3) Public hearings are conducted in April and December to obtain taxpayer comments and recommendations to the operating budget. 42 L CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 4) The budget and tax levy is legally enacted through the passage of a resolution on a department basis for the General Fund and on a fund basis for Special Revenue and Enterprise Funds that can be expended by each department based upon detailed budget estimates. 5) The City Manager and Finance Director are authorized to transfer appropriations within any department budget. Interdepartmental or interfund appropriations and deletions are authorized by the City Council with fund contingency reserves or additional revenues. 6) Formal budgetary integration is employed as a management control device during the year for the General Fund, Special Revenue, Capital Equipment and Enterprise Funds. The General Fund, Special Revenue Funds and Enterprise Funds all have Council adopted annual budgets. 7) Legal debt obligation indentures determine the appropriation level of debt service tax levies for the Debt Service Funds. Supplementary budgets are adopted for the Proprietary Funds to determine and calculate user charges. These debt service and budget amounts represent general obligation bond indenture provisions and net income for operation and capital maintenance and are not reflected in the financial statements. 8) A capital improvement program is reviewed annually by the City Council for the Capital Project Funds. However, appropriations for major projects are not adopted until the actual bid award of the improvement. The appropriations are not reflected in the financial statements. 9) The legal level of budgetary control is at the department level for the General Fund and the fund level for the Special Revenue Funds. Monitoring of budgets is maintained at the expenditure category level (i.e., personal services; materials and supplies; contractual services; and capital outlay) within each program. All amounts over budget have been approved by the City Council through the disbursement process. 10) The City Council may authorize transfer of budgeted amounts between City funds. The City Council made supplemental budgetary appropriations throughout the year. Individual amendments were not material in relation to the original appropriations which were adjusted. The following is a listing of the Special Revenue Fund whose expenditures exceed budget appropriations: F. CASH AND INVESTMENTS Cash and investment balances from all funds, except the Liquor Fund, are pooled and invested to the extent available in authorized investments. Investment income is allocated to individual funds on the basis of the fund's equity in the cash and investment pool. The City provides temporary advances to funds that have insufficient cash balances by means of an advance from another fund shown as interfund receivables in the advancing fund, and an interfund payable in the fund with the deficit, until adequate resources are received. These interfund balances are eliminated on the government -wide financial statements. 43 Final Over Budget Actual Budget Nonmaj or Fund: Special Revenue Fund: Police Forfeiture Fund $26,000 $39,497 $13,497 Fire Education /Training Fund 2,700 6,026 3,326 HRA Fund 215,000 227,921 12,921 F. CASH AND INVESTMENTS Cash and investment balances from all funds, except the Liquor Fund, are pooled and invested to the extent available in authorized investments. Investment income is allocated to individual funds on the basis of the fund's equity in the cash and investment pool. The City provides temporary advances to funds that have insufficient cash balances by means of an advance from another fund shown as interfund receivables in the advancing fund, and an interfund payable in the fund with the deficit, until adequate resources are received. These interfund balances are eliminated on the government -wide financial statements. 43 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Investments are stated at fair value, based upon quoted market prices, except for investments in 2a7 - like external investment pools, which are stated at amortized cost. Investment income is accrued at the balance sheet date. For purposes of the statement of cash flows, the City considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. All of the cash and investments allocated to the Proprietary Funds have original maturities of 90 days or less. Therefore, the entire balance in the Proprietary Funds is considered cash equivalents. Funds held in trust represent bond proceeds related to the Public Facilities Lease Revenue bond issue which are being held by a trustee. The trustee is responsible for the investment of these funds. G. RECEIVABLES AND PAYABLES During the course of operations, numerous transactions occur between individual funds for goods provided or services rendered. Short-term interfund loans are classified as "interfund receivables/payables." All short-term interfund receivables and payables at December 31, 2011 are planned to be eliminated in 2012. Long-term interfund loans are classified as "interfund loan receivable/payable." Any residual balances outstanding between the governmental activities and business -type activities are reported in the government -wide financial statements as "internal balances." Uncollectible property taxes and special assessments are not material and have not been reported (see Note I H and I). Because utility bills are considered liens on property, no estimated uncollectible amounts are established. Uncollectible amounts are not material for other receivables and have not been reported. H. PROPERTY TAX REVENUE RECOGNITION The City Council annually adopts a tax levy and certifies it to the County in December (levy/assessment date) of each year for collection in the following year. The County is responsible for billing and collecting all property taxes for itself, the City, the local School District and other taxing authorities. Such taxes become a lien on January 1 and are recorded as receivables by the City at that date. Real property taxes are payable (by property owners) on May 15 and October 15 of each calendar year. Personal property taxes are payable by taxpayers on February 28 and June 30 of each year. These taxes are collected by the County and remitted to the City on or before July 7 and December 2 of the same year. Delinquent collections for November and December are received the following January. The City has no ability to enforce payment of property taxes by property owners. The County possesses this authority. 44 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 GOVERNMENT -WIDE FINANCIAL STATEMENTS The City recognizes property tax revenue in the period for which the taxes were levied. Uncollectible property taxes are not material and have not been reported. GOVERNMENTAL FUND FINANCIAL STATEMENTS The City recognizes property tax revenue when it becomes both measurable and available to finance expenditures of the current period. In practice, current and delinquent taxes and State credits received by the City in July, December and January are recognized as revenue for the current year. Taxes collected by the County by December 31 (remitted to the City the following January) and taxes and credits not received at year end are classified as delinquent and due from County taxes receivable. The portion of delinquent taxes not collected by the City in January is fully offset by deferred revenue because they are not available to finance current expenditures. I. SPECIAL ASSESSMENT REVENUE RECOGNITION Special assessments are levied against benefited properties for the cost or a portion of the cost of special assessment improvement projects in accordance with State Statutes. These assessments are collectible by the City over a term of years usually consistent with the term of the related bond issue. Collection of annual installments (including interest) is handled by the County Auditor in the same manner as property taxes. Property owners are allowed to (and often do) prepay future installments without interest or prepayment penalties. Once a special assessment roll is adopted, the amount attributed to each parcel is a lien upon that property until full payment is made or the amount is determined to be excessive by the City Council or court action. If special assessments are allowed to go delinquent, the property is subject to tax forfeit sale. Proceeds of sales from tax forfeit properties are allocated first to the County's costs of administering all tax forfeit properties. Pursuant to State Statutes, a property shall be subject to a tax forfeit sale after three years unless it is homesteaded, agricultural or seasonal recreational land in which event the property is subject to such sale after five years. GOVERNMENT -WIDE FINANCIAL STATEMENTS The City recognizes special assessment revenue in the period that the assessment roll was adopted by the City Council. Uncollectible special assessments are not material and have not been reported. GOVERNMENTAL FUND FINANCIAL STATEMENTS Revenue from special assessments is recognized by the City when it becomes measurable and available to finance expenditures of the current fiscal period. In practice, current and delinquent special assessments received by the City are recognized as revenue for the current year. Special assessments that are collected by the County by December 31 (remitted to the City the following January) are also recognized as revenue for the current year. All remaining delinquent, deferred and special deferred assessments receivable in governmental funds are completely offset by deferred revenues. 45 L. CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 J. INVENTORIES GOVERNMENTALFUNDS The original cost of materials and supplies has been recorded as expenditures at the time of purchase. These funds do not maintain material amounts of inventories. PROPRIETARY FUNDS Inventories of the Proprietary Funds are stated at weighted average cost, which approximates market, using the first -in, first -out (FIFO) method. K. PREPAID ITEMS Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government -wide and fund financial statements. Prepaid items are reported using the consumption method and recorded as expenditures/expenses at the time of consumption. L. CAPITAL ASSETS Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads, bridges, sidewalks, and similar items) and intangible assets such as easements and computer software, are reported in the applicable governmental or business -type activities columns in the government -wide financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $5,000 (amount not rounded) and an estimated useful life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of donation. Pursuant to GASB Statement 34, in the case of the initial capitalization of general infrastructure assets (i.e., those reported by governmental activities), the City chose to capitalize retroactively to 1980. These assets are reported at estimated historical cost. The City estimated historical cost for the initial reporting of these assets through analysis of original bonding documents. As the City constructs or acquires additional infrastructure assets each period, they will be capitalized and reported at historical cost. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business -type activities is included as part of the capitalized value of the assets constructed. For the year ended December 31, 2011, no interest was capitalized in connection with construction in progress. The City implemented GASB Statement No. 51, Accounting and Financial Reporting.for Intangible Assets effective January 1, 2010 which required the City to capitalize and amortize intangible assets. Pursuant to GASB Statement 51, in the case of initial capitalization of intangible assets, the City chose to include such items regardless of their acquisition date, except for permanent easements and internally generate software. The City has already accounted for computer software and temporary easements at historical cost and therefore retroactive reporting was not necessary. 46 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Property, plant and equipment of the primary government, as well as the component units, are depreciated/amortized, using the straight-line method over the following estimated useful lives: Assets Buildings and structures 5 — 40 years Furniture, fixtures and equipment (including software) 3 — 20 years Distribution and collection systems 20 — 50 years Streets 20 — 50 years Storm sewers 25 years M. COMPENSATED ABSENCES It is the City's policy to permit employees to accumulate earned but unused personal leave benefits. All personal leave pay is accrued when incurred in the government -wide and proprietary fund financial statements. A liability for these amounts associated with governmental fund employees is reported in the Internal Service Severance Fund. In accordance with the provisions of Statement of Government Accounting Standards No. 16, Accounting for Compensated Absences, no liability is recorded for nonvesting accumulating rights to receive personal leave benefits. However, a liability is recognized for that portion of accumulating personal leave benefits that is vested as severance pay. N. LONG-TERM OBLIGATIONS In the government -wide financial statements and proprietary funds in the fund financial statements, long-term debt and other long -tern obligations are reported as liabilities in the applicable governmental activities, business -type activities, or proprietary funds statement of net assets. Bond premiums and discounts, as well as issuance costs, are deferred and amortized over the life of the bonds. Bonds payable are reported net of the applicable bond premium discount. Bond issuance costs are reported as deferred charges. In the governmental fund financial statements, governmental funds recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. L 47 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 O. FUND BALANCE CLASSIFICATIONS In the fund financial statements, governmental funds report fund balance in classifications that disclose constraints for which amounts in those funds can be spent. These classifications are as follows: Nonspendable - consists of amounts that are not in spendable form, such as prepaid items Restricted - consists of amounts related to externally imposed constraints established by creditors, grantors or contributors; or constraints imposed by state statutory provisions. Committed - consists of internally imposed constraints. These constraints are established by Resolution of the City Council. Assigned - consists of internally imposed constraints. These constraints reflect the specific purpose for which it is the City's intended use. These constraints are established by the City Council and/or management. Pursuant to City Council Policy, the City's Finance Director and/or City Manager are authorized to establish assignments of fund balance. Unassigned - is the residual classification for the general fund and also reflects negative residual amounts in other funds. When both restricted and unrestricted resources are available for use, it is the City's policy to first use restricted resources, and then use unrestricted resources as they are needed. When committed, assigned or unassigned resources are available for use, it is the City's policy to use resources in the following order; 1) committed 2) assigned and 3) unassigned. P. INTERFUND TRANSACTIONS Interfund services provided and used are accounted for as revenues, expenditures or expenses. Transactions that constitute reimbursements to a fund for expenditures/expenses initially made from it that are properly applicable to another fund, are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed. Interfund loans are reported as an interfund loan receivable or payable which offsets the movement of cash between funds. All other interfund transactions are reported as transfers. Q. USE OF ESTIMATES The preparation of financial statements in accordance with generally accepted accounting principles (GAAP) requires management to make estimates that affect amounts reported in the financial statements during the reporting period. Actual results could differ from such estimates. R. RECLASSIFICATIONS Certain amounts presented in the prior year data has been reclassified in order to be consistent with the current year's presentation. E" L. CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 S. COMPARATIVE TOTALS The basic financial statements, required supplementary information, combining and individual fund financial statements and schedules and supplementary financial information include certain prior -year summarized comparative information in total but not at the level of detail required for a presentation in conformity with generally accepted accounting principles. Accordingly, such information should be read in conjunction with the City's financial statements for the year ended December 31, 2011, from which the summarized information was derived. T. RECONCILIATION OF GOVERNMENT -WIDE AND FUND FINANCIAL STATEMENTS 1. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND BALANCE SHEET AND THE GOVERNMENT -WIDE STATEMENT OF NET ASSETS The governmental fund balance sheet includes a reconciliation between fund balance — total governmental funds and net assets —governmental activities as reported in the government -wide statement of net assets. One element of that reconciliation explains that "long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported in the funds". The details of this ($34,750,964) difference is as follows: Bonds payable ($34,225,000) Accrued interest payable (561,819) Unamortized bond discounts 2,569 Unamortized bond premium (238,599) Deferred charges 480,529 Other post -employment benefits (208,644) Net adjustment to reduce fund balance - total governmental funds to arrive at net assets - governmental activities. ($34,750,964) 49 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 2. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES AND THE GOVERNMENT -WIDE STATEMENT OF ACTIVITIES The governmental fund statement of revenues, expenditures and changes in fund balances includes a reconciliation between net changes in fund balances — total governmental funds and changes in net assets ofgovernmental activities as reported in the government -wide statement of activities. One element of that reconciliation explains that "governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense." The details of this $755,975 difference is as follows: Capital outlay $277,224 Construction/acquisition costs 1,953,923 Current expenditures capitalized 1,406 Depreciation expense (1,476,578) Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities. $755,975 Another element of that reconciliation states that "revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds". The details of this ($28,166) difference is as follows: General property taxes deferred revenue: At December 31, 2010 ($83,316) At December 31, 2011 78,886 Tax increment taxes deferred revenue: At December 31, 2010 (23,981) At December 31, 2011 61,874 Special assessments deferred revenue: At December 31, 2010 (1,759,922) At December 31, 2011 1,698,543 Due from other governmental units: At December 31, 2010 (250) At December 31, 2011 - Net adjustments to decrease net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities. ($28,166) 50 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Another element of that reconciliation states that "the issuance of long-term debt (e.g., bonds, leases) provides current financial resources to governmental funds, while the repayment of principal of the long-term debt consumes the current financial resources of governmental funds". Neither transaction, however, has any effect on net assets. The details of this ($1,184,327) difference is as follows: Debt issued or incurred Issuance of general obligation bonds ($5,165,000) Premium on issued bonds (105,598) Principal repayments 4,150,000 Other post employment benefits (63,729) Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities. ($1,184,327) Another element of that reconciliation states that "some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds". The details of this $28,711 difference is as follows: Amortization of issuance costs ($28,035) Amortization of premiums, discounts 20,464 Accrued interest (30,996) Bond issuance costs 67,278 Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities. $28,711 Note 2 DEPOSITS AND INVESTMENTS A. DEPOSITS In accordance with Minnesota Statutes, the City maintains deposits at those depository banks authorized by the City Council, all of which are members of the Federal Reserve System. Minnesota Statutes require that all City deposits be protected by insurance, surety bond, or collateral. The market value of collateral pledged must equal 110% of the deposits not covered by insurance or bonds. Minnesota Statutes require that securities pledged as collateral be held in safekeeping by the City Treasurer or in a financial institution other than that furnishing the collateral. Authorized collateral includes the following: a) United States government treasury bills, treasury note and treasury bonds; L 51 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 b) Issues of United States government agencies and instrumentalities as quoted by a recognized industry quotation service available to the government entity; c) General obligation securities of any state or local government with taxing powers which is rated "A" or better by a national bond rating service, or revenue obligation securities of any state or local government with taxing powers which is rated "AA" or better by a national bond rating service; d) General obligation securities of a local government with taxing powers may be pledged as collateral against funds deposited by that same local government entity: e) Irrevocable standby letters of credit issued by Federal Home Loan Banks to a municipality accompanied by written evidence that the bank's public debt is rated "AA" or better by Moody's Investors Service, Inc. or Standard & Poor's Corporation; and f) Time deposits that are fully insured by any Federal agency. Custodial Credit Risk — Deposits: Custodial credit risk is the risk that in the event of a bank failure, the City's deposits may not be returned to it. State statutes require that insurance, surety bonds or collateral protect all City deposits. The market value of collateral pledged must equal 110% of deposits not covered by insurance or bonds. As of December 31, 2011, the bank balance of the City's deposits was covered by federal depository insurance. B. INVESTMENTS Minnesota Statutes authorize the City to invest in the following: a) Direct obligations or obligations guaranteed by the United States or its agencies, its instrumentalities or organizations created by an act of congress, excluding mortgage-backed securities defined as high risk. b) Shares of investment companies registered under the Federal Investment Company Act of 1940 and whose only investments are in securities described in (a) above, general obligation tax-exempt securities, or repurchase or reverse repurchase agreements. c) State and local securities as follows: 1) any security which is a general obligation of any state or local government with taxing powers which is rated "A" or better by a national bond rating service; 2) any security which is a revenue obligation of any state or local government with taxing powers which is rated "AA" or better by a national bond rating service; and 3) a general obligation of the Minnesota Housing Finance Agency which is a moral obligation of the State of Minnesota and is rated "A" or better by a national bond rating agency. d) Bankers acceptances of United States banks. e) Commercial paper issued by United States corporations or their Canadian subsidiaries, of the highest quality, and maturing in 270 days or less. 52 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 f) Repurchase or reverse repurchase agreements with banks that are members of the Federal Reserve System with capitalization exceeding $10,000,000; a primary reporting dealer in U.S. government securities to the Federal Reserve Bank of New York; certain Minnesota securities broker-dealers; or, a bank qualified as a depositor. g) General obligation temporary bonds of the same governmental entity issued under section 429.091, subdivision 7; 469.178, subdivision 5; or 475.61, subdivision 6. As of December 31, 2011, the City had the following investments and maturities: Investment Maturities (in Years) Fair Less Over Investment Type Rating Value Than 1 1-5 6-10 10 Years Federal Home Loan Mortgage Corp. AAA $100,203 $ - $ - $ - $100103 Federal National Mortgage Association AAA 400,631 - - - 400,631 REMIC NR 1,554 - - - 1,554 Money market NR 9,890,021 9,890,021 - - - External investment pool -4M Fund NR 752,385 752,385 - - - Brokered cenificatesofdeposit NR 1,039,417 183,189 486,186 370,042 Tota] $12,184,211 $10,825 595 $486,186 $370,042 $502,388 NR - Not Rated Total investments $12,184,211 Deposits 999,873 Petty cash 5,200 Total cash and investments 513,189,284 Following is a reconciliation of the City's cash and investment balances as of December 31, 2011: Cash and investments $10,600,416 Cash and investments - fiduciary fund ($13,372) Restricted cash and investments 2,164,079 Funds held in trust 438,161 $13,189,284 C. INVESTMENT RISKS Custodial credit risk — investments — For investments in securities, custodial credit risk is the risk that in the event of failure of the counterparty to a transaction, the City will not be able to recover the value of its investment securities that are in the possession of an outside party. Investments in investment pools and money markets are not evidenced by securities that exist in physical or book entry form, and therefore are not subject to custodial credit risk disclosures. The City's investment policy does not address custodial risk. However, investments in securities are held by the City's broker-dealers of which $500,000 is insured through SIPC. The broker-dealer has provided additional protection by providing additional insurance. This insurance is subject to aggregate limits applied to all of the broker-dealers' accounts. 53 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Interest rate risk — Interest rate risk is the risk that changes in interest rates of debt investments could adversely affect the fair value of an investment. The City's investment policy requires the City to diversify its investment portfolio to eliminate the risk of loss resulting from over concentration of assets in a specific maturity. The policy also states the City's investment portfolio will remain sufficiently liquid to enable the City to meet all operating requirements which might be reasonably anticipated. Credit Risk — Credit risk is the risk that an issuer or other counterparty to an investment will be unable to fulfill its obligation to the holder of the investment. State law limits investments in commercial paper to those rated in the highest quality category by at least two nationally recognized rating agencies; in any security of the State of Minnesota or any of its municipalities which is rated "A" or better by a national bond rating service for general obligation and rated "AA" or better for a revenue obligation; a general obligation of the Minnesota Housing Finance Agency to those rated "A" or better by a national bond rating agency; mutual funds or money market funds whose investments are restricted to securities described in MS 118A.04. The City's investment policy does not place further restrictions on investment options. Concentration of credit risk — Concentration of credit risk is the risk of loss that may be attributed to the magnitude of a government's investment in a single issuer. The City places no limit on the amount the City may invest in any one issuer. The City does not have exposure to a single issuer that equals or exceeds 5% of the overall portfolio and, therefore, there is no concentration of credit risk. Note RECEIVABLES Significant receivables balances not expected to be collected within one year of December 31, 2011 are as follows: Major Funds Street Water Improvement HRA HRA Filtration & Nonmajor General Debt Service Debt Service Projects Purification Funds Total Special assessments receivable $ - $1,027,000 $ - $ - $ - $500,000 $1,527,000 Delinquent property taxes 18,200 5,800 2,700 6,000 3,500 36,200 $18,200 $1,032,800 $2,700 $6,000 $0 $503,500 $1,563,200 54 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Governmental funds report deferred revenue in connection with receivables for revenues that are not considered to be available to liquidate liabilities of the current period. Governmental funds also defer revenue recognition in connection with resources that have been received, but not yet earned. At the end of the current fiscal year, the various components of deferred revenue and unearned revenue reported in the governmental funds were as follows: Delinquent property taxes receivable (General Fund) Delinquent property taxes receivable (Street Improvement Debt Service) Delinquent property taxes receivable (HRA Debt Service) Delinquent property taxes receivable (Nonmajor Funds) Delinquent TIF (HRA Projects Fund) Special assessments not yet due (General Fund) Special assessments not yet due (Street Improvement Debt Service) Special assessments not yet due (Nonmajor Funds) Total deferred/unearned revenue for governmental funds 55 Unavailable Unearned $47,496 15,239 6,921 9,230 61,874 30 1,164,160 534,353 $1,839,303 $0 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Note 4 CAPITAL ASSETS Capital asset activity for the year ended December 31, 2011 was as follows: Primary Government Governmental activities: Capital assets, not being depreciated: Land Construction in progress Total capital assets, not being depreciated Capital assets, being depreciated: Buildings and improvements Land improvement Furniture, fixtures and equipment (including software) Streets Storm sewers Storm water Total capital assets, being depreciated Less accumulated depreciation/amortization for: Buildings and improvements Land improvement Furniture, £octures and equipment Software and intangibles Streets Stone sewers Storm water Total accumulated depreciation/amortization Total capital assets being depreciated - net Beginning Ending Balance Increases Decrease Balance $3,378,842 $ - $ - $3,378,842 8,534,183 1,955,326 (8,516,216) 1,973,293 11,913,025 1,955,326 (8,516,216) 5,352,135 9,829,307 7,629 - 9,836,936 874,059 - - 874,059 3,084,943 336,808 (51,505) 3,370,246 20,808,158 8,449,006 - 29,257,164 428,469 - - 428,469 1,468,902 1,468,902 36,493,838 8,793,443 (51,505) 45,235,776 2,568,924 295,783 - 2,864,707 19,492 43,925 - 63,417 1,983,852 221,335 (35,142) 2,170,045 - 6,476 - 6,476 5,982,947 833,164 - 6,816,111 36,161 17,139 - 53,300 63,653 58,756 - 122,409 10,655,029 1,476,578 (35,142) 12,096,465 25,838,809 7,316,865 (16,363) 33,139,311 Governmental activities capital assets - net $37,751,834 $9,272,191 $8 532 579 $38,491,446 56 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Primary Government Business -type activities: Capital assets, not being depreciated: Land Capital assets, being depreciated: Buildings and structures Furniture, fixtures and equipment Software and intangibles Distribution and collection system Total capital assets, being depreciated Less accumulated depreciation for: Buildings and structures Furniture, fixtures and equipment Software and intangibles Distribution and collection system Total accumulated depreciation Total capital assets being depreciated -net Business -type activities capital assets -net Beginning Ending Balance Increases Decrease Balance $5,653 $ - $ - $5,653 3,883,283 - - 3,883,283 1,433,610 7,465 - 1,441,075 26,022 - - 26,022 6,797,401 6,797,401 12,140,316 7,465 0 12,147,781 1,576,865 102,887 - 1,679,752 558,769 59,830 - 618,599 434 5,204 - 5,638 3,268,996 173,216 - 3,442,212 5,405,064 341,137 0 5,746,201 6,735.252 (333,672) 0 6,401,580 $6,740,905 ($333,672) $0 56,407,233 Depreciation/amortization expense was charged to functions/programs of the primary government as follows: Governmental activities: General government Public safety Public works, including depreciation of general infrastructure assets Parks and recreation Total depreciation/amortization expense - governmental activities Business -type activities: Liquor Water Sewer Total depreciation/amortization expense - business -type activities Total depreciation expense i L 57 $117,691 182,720 1,084,498 91.669 1,476,578 85,062 166,923 89,151 341,136 $1,817,714 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 CONSTRUCTION COMMITMENTS At December 31, 2011, the City had construction project contracts in progress. The commitments related to the remaining contract balances are summarized as follows: Contract Remaining Project Amount Commitment 2011 Street Improvements $1,433,470 $69,164 Note 5 LONGTERM DEBT The City issues general obligation bonds to finance its street improvement program, tax increment projects and other City purposes. General obligation bonds are direct obligations of the City and are supported by the full faith and credit of the City. The City has several types of general obligation bonds outstanding at December 31, 2011. Following is a brief description of the different bond types: • Improvement bonds are issued to finance street improvement projects. These bonds are payable primarily from special assessments levied on benefited properties. The costs of these projects are shared by the City; general property taxes levied provide the revenues for these costs. • Tax increment bonds were used to finance redevelopment projects and are payable primarily from incremental property taxes derived from the tax increment districts with any deficiency to be provided from general property taxes. • Storm sewer revenue bonds used to finance storm water improvement projects are payable primarily from service charges to residents. • State aid street bonds were utilized for a street improvement project and will be paid from future state aids received annually. • Tax abatement bonds were issued to finance a portion of the park improvement project and are payable from a special general property tax levy. • Certificates of indebtedness issued to finance various equipment acquisitions are payable from a special general property tax levy. PUBLIC FACILITIES LEASE REVENUE BONDS These bonds issued are being used to finance renovation of public works facilities and the construction of a fire station/hall. These bonds were issued by the Housing and Redevelopment Authority and are payable from annual transfers from the General Fund derived from a special general property tax levy. These bonds are deemed a direct obligation of the City, although issued by the HRA, and are supported by the full faith and credit of the City under a lease revenue indenture with the HRA. REVENUE BONDS The City has issued revenue bonds to finance business -type activities. These bonds are Liquor Revenue and Utility Revenue Bonds which are payable from operations of these two Enterprise Funds, respectively. The liability for these bonds is recorded in the Proprietary Funds. W. CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 FANNIE MAE LOAN PAYABLE The City entered into a non -revolving line of credit agreement with Fannie Mae. The line of credit was for a total of $3,350,000; proceeds were used to fund the acquisition of property in the Apache Plaza area related to the Silver Lake Village development. The City disbursed the funds to the developer who applied the funds towards purchase of property and other costs associated with the redevelopment project. The project is primarily for residential purposes. The loan was for a period of 36 months and was set to mature on August 27, 2007; however, the City extended the loan period to January 3, 2011. Interest on the loan is payable quarterly. The interest rate is variable based on the three month LIBOR (as published in the Wall Street Journal) plus 175 basis points. In addition, the interest rate will be reset quarterly on the first day of each calendar quarter. The City paid off this line of credit on January 3, 2011. 59 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 GOVERNMENTAL ACTIVITIES As of December 31, 2011, the long-term debt of the financial reporting entity consisted of the following: G.O. Improvement Bonds: G.O. Improvement Bands, Series 2004A G.O. Improvement Bonds, Series 2005A G.O. Improvement Bonds, Series 2006A G.O. Improvement Bonds, Series 2007A G.O. Improvement Bonds, Series 2009A G.O. Improvement Refunding Bonds, Series 2009B G.O. Improvement Bonds, Series 2010A G.O. Improvement Bonds, Series 2011A G.O. Improvement Refunding Bonds, Series 201 IB Total improvement bonds G.O. Street Reconstruction Bonds: G.O. Street Reconstruction Bonds, Series 2008A G.O. Tax Increment Bonds: G.O. Taxable Tax Increment Refunding Bends, Series 2003E Tax Increment Revenue Bonds: Tax Increment Revenue Bonds, Series 2006B Tax Increment Revenue Bonds, Series 2007 Total tax increment revenue bonds G.O. Revenue Bonds: G.O. Stam Sewer Refunding Revenue Bonds, Series 2009A G.O. Tax Abatement Bonds: G.O. Tax Abatement Binds, Series 2009A G.O. Tax Abatement Refunding Bonds, Series 2009B Total tax abatement bonds G.O. State Aid Bonds G. O. State Aid Street Refunding Bonds, Series 2009A Public Facilities Lease Revenue Bonds: Public Facilities Lease Revenue Bonds, Series 2003 Issuance premiums (discounts) Total - bonded indebtedness Conpensated absences payable Total City indebtedness - goverrvnental activities Final Interest Issue Maturity Original Payable Rates Date Date Issue 1221/11 2.00-4.60% 6/12004 2/1/2012 $1,790,000 $1,150,000 2.70-4.15% 4/12005 2/1/2012 1,695,000 1,225,000 4.00% 4/12006 2/1/2022 3,190,000 2,335,000 3.50-4.10°/ 4242007 2/1/2014 2,050,000 1,735,000 3.00-4.00% 5/72009 2/1/2025 2,630,000 2,490,000 2.50-3.00% 12/162009 2/1/2018 1,335,000 1,170,000 2.25-3.625% 5202010 2/1/2026 1,375,000 1,375,000 3.00-4.001/6 4/122011 2/1/2027 2,955,000 2,955,000 0.40-2.00% 12292011 2/1/2021 2,210,000 2,210,000 19,230,000 16,645,000 3.00-4.00% 6/52008 2/1/2024 1,910,000 1,710,000 3.00-5.00% 11/52003 2/1/2013 1,170,000 370,000 5.00-5.62% 8/12006 8/1/2031 4,975,000 4,600,000 4.30-5.00% 4/172007 2/1/2031 4,640,000 4,375,000 9,615,000 8,975,000 3.004.009/6 5/72009 2/1/2015 825,000 565,000 3.00-4-00% 5/72009 2/1/2025 1,335,000 1,335,000 2.50-3.00% 12/102009 2/1/2016 310,000 265,000 1,645,000 1,600,000 3.00-4.00% 5/72009 2/1/2015 385,000 250,000 2.00-4.15% 4/12003 2/1/2013 5,530,000 4,110,000 N/A 236.030 40,310,000 34,461,030 703,122 $40,310,000 $35.164,152 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 BUSINESS -TYPE ACTIVITIES Revenue Bonds: 1 G.O. Water and Sewer Revenue Bonds, Series 2003B Compensated absences Total City indebtedness - business -type activities i Total City indebtedness Final G.O. Improvement Bonds G.O. Tax Increment Bonds Interest Maturity Original Payable Rates Date Date Issue 12/31/11 2.004.45% 4/162003 2/12024 $2,200,000 $1,640,000 - 143,422 $6,950,000 2,200,000 1,783,422 $13,865 $42,510,000 $36,947,574 Annual debt service requirements to maturity for long-term debt are as follows: I Governmental Activities Year Ending G.O. Improvement Bonds G.O. Tax Increment Bonds G.O. Revenue Bonds December 31 Principal Interest Principal Interest Principal Interest 2012 $6,950,000 $417,656 $180,000 $13,865 $135,000 $14,925 2013 865,000 254,964 190,000 4,750 135,000 10,875 2014 890,000 236,465 - - 145,000 6,675 2015 905,000 216,995 - - 150,000 2,250 2016 920,000 196,530 - - - - 2017 935,000 174,795 - - - - 2018 880,000 152,534 - - - - 2019 800,000 130,862 - - - - 2020 675,000 111,090 - - - - 2021 550,000 93,608 - - - - 2022 435,000 77,479 - - - - 2023 455,000 61,426 - - - - 2024 470,000 44,244 - - - - 2025 485,000 26,061 - - - - 2026 270,000 11,584 - - - - 2027 160,000 3,200 - - - - Total $16,645,000 $2,209,493 $370,000 $18,615 $565,000 $34,725 61 L. CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Governmental Activities Tax Increment All Other General Year Ending Revenue Bonds Lease Revenue Bonds Obligation Bonds December 31 Principal Interest Principal Interest Principal Interest 2012 $205,000 $465,268 $4,110,000 $76,155 $290,000 $121,020 2013 225,000 455,080 - - 295,000 112,233 2014 245,000 443,743 - - 300,000 103,164 2015 260,000 431,549 - - 310,000 93,726 2016 280,000 418,368 - - 260,000 84,564 2017 300,000 403,790 - - 215,000 76,351 2018 330,000 387,949 - - 220,000 68,551 2019 350,000 370,568 - - 230,000 60,381 2020 385,000 351,903 - - 240,000 51,661 2021 405,000 331,684 - - 250,000 42,371 2022 440,000 310,039 - - 265,000 32,419 2023 470,000 286,157 - - 275,000 21,828 2024 500,000 260,437 - - 285,000 10,700 2025 535,000 233,125 - - 125,000 2,500 2026 575,000 203,938 - - - - 2027 615,000 172,453 - - - - 2028 655,000 138,828 - - - - 2029 700,000 103,079 - - - - 2030 745,000 64,906 - - - - 2031 755,000 19,547 Total $8,975,000 $5,852,408 $4,117000 $76,155 $3,560,000 $881,469 "'Interest rate is reset quarterly on the first day of each calendar quarter (January 1, April 1, July 1 and October 1) Business -Type Activities Year Ending Revenue Bonds December 31 Principal Interest 2012 $95,000 $66,122 2013 95,000 62,703 2014 100,000 59,094 2015 105,000 55,197 2016 110,000 51,031 2017 120,000 46,411 2018 125,000 41,358 2019 130,000 36,018 2020 135,000 30,386 2021 145,000 24,364 2022 150,000 17,948 2023 160,000 11,125 2024 170,000 3,782 Total $1,640,000 $505,539 It is not practicable to determine the specific year for payment of long-term accrued compensated absences. 62 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 CHANGE IN LONG-TERM LIABILITIES Long-term liability activity for the year ended December 31, 2011, was as follows: Governmental activities: Bonds payable: G.O. improvement debt G.O. street reconstruction bonds G.O. tax increment bonds G.O. revenue bonds G.O. state aid street bonds G.O. tax abatement bonds Tax increment revenue bonds G.O. public facilities lease revenue bonds Total bonds payable - governmental activities Issuance premiums (discounts) Total bonded indebtedness Fannie Mae loanpayable Compensated absences Total govemmental activities long-term liabilities Business -type activities: Revenue bonds Compensated absences Total business -type activities long-term liabilities Beginning Ending Due Within Balance Additions Reductions Balance One Year $13,450,000 $5,165,000 ($1,970,000) $16,645,000 $6,950,000 1,810,000 - (100,000) 1,710,000 105,000 545,000 - (175,000) 370,000 180,000 695,000 - (130,000) 565,000 135,000 315,000 - (65,000) 250,000 65,000 1,645,000 - (45,000) 1,600,000 120,000 9,165,000 - (190,000) 8,975,000 205,000 4,335,000 (225,000) 4,110,000 4,110,000 31,960,000 5,165,000 (2,900,000) 34,225,000 11,870,000 150,896 105,598 (20,464) 236,030 23,711 32,110,896 5,270,598 (2,920,464) 34,461,030 11,893,711 1,250,000 - (1,250,000) - - 691,339 321,879 (310,096) 703,122 235,895 $34,052,235 $5,592,477 ($4,480360) $35,164,152 $12,129,606 $1,825,000 $ - ($185,000) $1,640,000 $95,000 146,140 74,162 (76,880) 143,422 58,295 $1,971,140$74,162 ($261,880) $1,783,422 $153,295 For the governmental activities, compensated absences are generally liquidated by the Internal Service Severance Fund and loans payable are generally liquidated by the Street Improvement Projects Fund. All long-term bonded indebtedness outstanding at December 31, 2011 is backed by the full faith and credit of the City, including improvement and revenue bond issues, except for the Public Facilities Lease Revenue Bonds of 2003 and the Tax Increment Bonds of 2006B and 2007. Delinquent assessments receivable at December 31, 2011 totaled $9,000. L 63 L CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 PLEDGED REVENUE Future revenue pledged for the payment of long-term debt is as follows: G1H Revue PIM C—D Ya P., of Debl arsda Rinaipal and xi Rm¢ninB U..I ToW na%of T—a Rmaipal andlnmm- Reumm Boa 1— Pmadls D. B¢Na Nn Rexnu¢ PIMD, and M¢¢I Nid R—wed 2009A Sism Aid S nxi ReNang Refimdi,d20(d;&m Aid MSA ilMmnls 10tH. WA 20093015 464,700 $]3.4]5 57A966 S. Wb 2009ATu Alntnml Ea ddPakiq —15 Tax absbnemswmue I00% N/A 2009-2025 (1.]06994 345552 $31,N5 2009B Tax Axdmml Re6laog R di, d2031ATu Taalepmml rtvmue IM% N/A 2D05I3016 V81938 $52,188 424388 Pbaimml Bonds 2003A Rad hp—D. 9rsl in oven 02003 Spinel—D, 21% N/A 2003-2019 S - ELI66.106 532536 20NA ROM MpawmmbSrt¢i0pmta anw Sp¢el—x 23% N/A 20%3020 $1,174,439 $160,938 $22692 2005A Rind Mpmrcmmb Sirt¢ad Ywm anrte Sda,W snmis 23% NIA 2005-2021 51,248,719 $149,063 524391 inpm.snen6 d2035 20WA Rand fnp—I, Bmeand 9onn.r Spmblac ,—. 40% N/A 2006-2022 $1,626.900 5176,000 N0510 2007A Rmd fnpm ens SL¢e and 5pwhlnsa D3 29M WA 260/-2023 $1,768240 (1]8.460 55,0544 2009A ROM Mpswemmb 2009.dmvnhcdan Spm.lummsmuia 21% N/A 2003-2025 $3,172001 $226A18 51%601 2010A Rwtl fnpmv¢nens 2010 and rowmgiad Spmbinssanmis 9% WA 20103026 51,731,249 548}29 SQ4M 2009R ROM Nproammla Rebindn, d201B and 202A Spmelammsmms ]% N/A 200930/8 51,273513 5197$.8 532d3M RPOInd4 Rud hnPwrnm Bond: 2008A SOmI Rwvnam¢im Bolls &I—Wa Redd mpmsvnms Tu lex, 98% N/A 20N-2024 52,189,838 $167300 $In3]4 2009A&onn!I m ReNndngs Revenue Fx6.di, oI N0A S. !I—Revenue Nldiryehsg¢ 100% N/A 20093015 499,725 f148,YN' SINN 2003ETW Ref di,, d 1996 rF bads, TIF 100% N/A 20083013 WaU15 519].169 526414 mdmebpm of Supes Valu 2 NBlIF RMevelrymmldp Rt nF 100% N/A 20W2031 $],]46$84 $351,675 $1,215,240 emm 03 and TIF3-5 2007TW Rxd ed'mml TIF IM WA 20073031 57,080,824 (312.]46 5312745 2003 Lmse Revenm Mw,, wine¢] and 6miA Lmertsmue ID0% WA 2W 2024 $5159.945 $390,685 W00.987 public wwFa and RD, MI, 20038 GO. WaedSexn Wat—d sewer unlRy C%rya fmswa¢ 160% T3% 2.-2024 $2,145139 3158A64 5158060 xwma :npmwnms 2011A Rad fnp�dnd Dxhnd D, W03A Ss¢I Sp¢biximmsmems 22% WA 2011.2026 1,154)23 - 32d3.8 RePondr, Lrymwnml Bonds 20118 Rmd In,.—Ds xefundia MWAend 2005A Sp¢bl 25% N/A 20122020 2.362p+1 32439 Refund.. &.hn —I RONs G1H CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 CURRENT REFUNDING A. 2011A On April 12, 2011, the City issued the $1,015,000 General Obligation Refunding Bonds, Series 2011A with an average interest rate of 3.5% to refund the 2012 through 2019 maturities aggregating $1,030,000 in principal amount of the City's $1,700,000 General Obligation Improvement Bonds, Series 2003A with an average interest rate of 3.8%, dated April 16, 2003. Net proceeds of $1,039,974 were used to retire all outstanding principal of the refunded bonds on May 11, 2011. The City refunded the bonds to reduce its total debt service payments over the eight years by $63,644 and to obtain an economic gain (difference between the present value of the debt service payments on the old and new debt) of $30,185. B. 2011B On December 29, 2011, the City issued the $2,210,000 General Obligation Refunding Bonds, Series 2011B with an average interest rate of 1.4% to refund the 2013 through 2020 maturities aggregating $1,035,000 in principal amount of the City's $1,790,000 General Obligation Improvement Bonds, Series 2004A with an average interest rate of 4.3%, dated June 1, 2004 and to refund the 2013 through 2021 maturities aggregating $1,125,000 in principal amount of the City's $1,695,000 General Obligation Improvement Bonds, Series 2005A with an average interest rate of 3.9%, dated April 1, 2005. Net proceeds of $2,164,079 were used to retire all outstanding principal of the refunded bonds on February 1, 2012. The City refunded the bonds to reduce its total debt service payments over the nine years by $250,696 and to obtain an economic gain (difference between the present value of the debt service payments on the old and new debt) of $231,455. Note 6 DEFINED BENEFIT PENSION PLANS - STATEWIDE A. PLAN DESCRIPTION All full-time and certain part-time employees of the City are covered by defined benefit plans administered by the Public Employees Retirement Association of Minnesota (PERA). PERA administers the General Employees Retirement Fund (GERF) and the Public Employees Police and Fire Fund (PEPFF) which are cost-sharing, multiple -employer retirement plans. These plans are established and administered in accordance with Minnesota Statutes, Chapters 353 and 356. GERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated Plan members are covered by Social Security and Basic Plan members are not. All new members must participate in the Coordinated Plan. All police officers, firefighters and peace officers who qualify for membership by statute are covered by the PEPFF. PERA provides retirement benefits as well as disability benefits to members, and benefits to survivors upon death of eligible members. Benefits are established by State Statute, and vest after three years of credited service. The defined retirement benefits are based on a member's highest average salary for any five successive years of allowable service, age, and years of credit at termination of service. M CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 The benefit provisions stated in the previous paragraphs of this section are current provisions and apply to active plan participants. Vested, terminated employees who are entitled to benefits but are not receiving them yet are bound by the provisions in effect at the time they last terminated their public service. PERA issues a publicly available financial report that includes financial statements and required supplementary information for GERF and PEPFF. That report may be obtained on the internet at www.mnnera.ore, by writing to PERA, 60 Empire Drive #1200, St. Paul, Minnesota, 55103-2088 or by calling (651) 296-7460 or 1-800-652-9026. B. FUNDING POLICY Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. These statutes are established and amended by the state legislature. The City makes annual contributions to the pension plans equal to the amount required by state statutes. GERF Basic Plan members and Coordinated Plan members were required to contribute 9.1 % and 6.25%, respectively, of their annual covered salary in 2011. PEPFF members were required to contribute 9.6% of their annual covered salary in 2011. The City was required to contribute the following percentages of annual covered payroll in 2011: 11.78% for Basic Plan GERF members, 7.25% for Coordinated Plan GERF members, and 14.4% for PEPFF members. The City's contributions to the General Employees Retirement Fund for the years ending December 31, 2011, 2010 and 2009 were $131,203, $124,160 and $115,915, respectively. The City's contributions to the Public Employees Police and Fire Fund for the years ending December 31, 2011, 2010 and 2009 were $332,497, $321,035 and $315,447, respectively. The City's contributions were equal to the contractually required contributions for each year as set by state statute. C. PUBLIC EMPLOYEES RETIREMENT ASSOCIATION (PERA) - DEFINED CONTRIBUTION PLAN DESCRIPTION All council members of the City are covered by the Public Employees Defined Contribution Plan (PEDCP), a multiple -employer deferred compensation plan administered by the Public Employees Retirement Association of Minnesota (PERA). The PEDCP is a tax qualified plan under Section 401(a) of the Internal Revenue Code and all contributions by or on behalf of employees are tax deferred until time of withdrawal. Benefit Provisions and Contribution Rates Plan benefits depend solely on amounts contributed to the plan plus investment earnings, less administrative expenses. Minnesota Statutes, Chapter 353D.03, specifies plan provisions, including the employee and employer contribution rates for those qualified personnel who elect to participate. Plan provisions are established and can be amended by State Statutes. An eligible elected official who decides to participate contributes 5 percent of salary which is matched by the elected official's employer. Employer and employee contributions are combined and used to purchase shares in one or more of the seven accounts of the Minnesota Supplemental Investment Fund. For administering the plan, PERA receives 2 percent of employer contributions and twenty-five hundredths of one percent of the assets in each member's account annually. CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Plan benefits depend solely on amounts contributed to the plan plus investment earnings, less administrative expenses. Total contributions made by the City during fiscal year 2011 were: Percentage of Amount Covered Payroll Required Employees Employer Employees Employer Rates PEDCP $1,613 $1,613 5.00% 5.00% 5.00% D. SINGLE EMPLOYER PERS PLAN DESCRIPTION — ST. ANTHONY FIREFIGHTER'S RELIEF ASSOCIATION All members of the St. Anthony Fire Department are covered by a defined benefit plan administered by the St. Anthony Firefighter's Relief Association. The Plan is a single employer retirement plan and is established and administered in accordance with Minnesota Statute, Chapter 69. The Relief Association provides retirement benefits as well as disability benefits to members and benefits to survivors upon death of eligible members. Benefits are established in accordance with the State Statute and vest after ten years of credited service. The defined retirement benefits are based on a member's years of service. Benefit provisions can be amended by the Relief Association within the parameters provided by State Statutes. The Relief Association issues a publicly available financial report that includes financial statements and required supplementary information. That report may be obtained by writing to St. Anthony Firefighter's Relief Association, 3505 Silver Lake Road, St. Anthony, Minnesota, 55418. 67 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 FUNDING POLICY Minnesota Statutes Chapter 69.772 sets the minimum contribution requirement for the City and State aid on an annual basis. These statutes are established and amended by the state legislature. The Relief Association is comprised of volunteers; therefore, members have no contribution requirements. The City receives the State aid contribution and is required by state statutes to pass this through as payment to the Relief Association. This transaction, in the amount of $32,574, is recorded as a revenue and an expenditure in the City's 2011 financial statements. The City's annual pension cost for 2010 (2011 is unavailable) and related information for the plan is as follows: Annual pension cost $40,415 Contributions made: City $6,000 State aid $34,415 Actuarial valuation date 12/31/10 Actuarial cost method Entry age normal Amortization method Level dollar closed Remaining amortization period: Normal cost 20 years Prior service cost 5 years Asset valuation method Market Actuarial assumptions Investment rate of return 5% Projected salary increases N/A Inflation rate N/A Cost of living adjustments None Age of service requirements 50 Post-retirement benefits increase None M r CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Three year trend information (information for December 31, 2011 is not available): Three Year Trend Information Annual Year Pension Ending Cost (APC) 12/31/2010 $40,415 12/31/2009 38,411 12/31/2008 44,755 Percentage Net of APC Pension Contributed Obligation 100% $ 100% 100% REQUIRED SUPPLEMENTARY INFORMATION — SCHEDULE OF FUNDING PROGRESS Note 7 OTHER POST -EMPLOYMENT BENEFITS (OPEB) In 2009, the City prospectively implemented the requirement of a new accounting pronouncement, GASB Statement No. 45, Accounting and Financial Reporting by Employers for Post -employment Benefits Other Than Pensions. A. PLAN DESCRIPTION In addition to providing the pension benefits described in Note 6, the City provides post -employment health care benefits (as defined in paragraph B) for retired employees and police and firefighters disabled in the line of duty, through a single -employer defined benefit plan. The term Plan refers to the City's requirement by State Statute to provide retirees with access to health insurance. The OPEB plan is administered by the City. The authority to provide these benefits is established in Minnesota Statutes Sections 471.61 Subd. 2a, and 299A.465. The benefits, benefit levels, employee contributions and employer contributions are governed by the City and can be amended by the City through its personnel manual and collective bargaining agreements with employee groups. The Plan is not accounted for as a trust fund, as an irrevocable trust has not been established to account for the plan. The Plan does not issue a separate report. Assets in Excess of Pension Actuarial Actuarial Actuarial (Unfunded) Benefit Valuation Value of Accmed Accrued Funded Per Year Date Assets Liability Liability Ratio of Service 12/312010 $984,659 $862,804 $121,855 114.12% $2,500 12/312009 872,655 816,512 56,143 106.88% 2,500 12/312008 735,213 866,712 (131,499) 84.83% 2,500 Note 7 OTHER POST -EMPLOYMENT BENEFITS (OPEB) In 2009, the City prospectively implemented the requirement of a new accounting pronouncement, GASB Statement No. 45, Accounting and Financial Reporting by Employers for Post -employment Benefits Other Than Pensions. A. PLAN DESCRIPTION In addition to providing the pension benefits described in Note 6, the City provides post -employment health care benefits (as defined in paragraph B) for retired employees and police and firefighters disabled in the line of duty, through a single -employer defined benefit plan. The term Plan refers to the City's requirement by State Statute to provide retirees with access to health insurance. The OPEB plan is administered by the City. The authority to provide these benefits is established in Minnesota Statutes Sections 471.61 Subd. 2a, and 299A.465. The benefits, benefit levels, employee contributions and employer contributions are governed by the City and can be amended by the City through its personnel manual and collective bargaining agreements with employee groups. The Plan is not accounted for as a trust fund, as an irrevocable trust has not been established to account for the plan. The Plan does not issue a separate report. CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 B. BENEFITS PROVIDED Retirees The City is required by State Statute to allow retirees to continue participation in the City's group health insurance plan if the individual terminates service with the City through service retirement or disability retirement. To be eligible for benefits, an employee must qualify for retirement or disability benefits from a Minnesota public pension plan. The employee may continue to participate in the City's group health insurance plan that the employee was a participant of immediately prior to retirement. Employees may obtain dependent coverage at retirement only if the employee was receiving dependent coverage immediately prior to retirement. Covered spouses may continue coverage after the retiree's death. The surviving spouse of an active employee may continue coverage in the group health insurance plan after the employee's death. All health care coverage is provided through the City's group health insurance plans. The retiree is required to pay 100% of their premium cost for the City -sponsored group health insurance plan in which they participate. The premium is a blended rate determined on the entire active and retiree population. Since the projected claims costs for retirees exceed the blended premium paid by retirees, the retirees are receiving an implicit rate subsidy (benefit). The coverage levels are the same as those afforded to active employees. Upon a retiree reaching age 65 years of age, Medicare becomes the primary insurer and the City's plan becomes secondary. Disabled police and firefighter The City continues to pay the employer's contribution toward health coverage for Police or Firefighters disabled in the line of duty per Minnesota Statute 299A.465, until age 65. Coverage for a spouse is included, if the spouse was covered at the time of the disability. The January 1, 2011 through December 31, 2011 monthly premiums paid for Police or Firefighters disabled in the line of duty are: Employee Employee Plus Spouse Open Access $734 $1,562 Distinctions IEI 684 1,459 $1,200 deductible plan HSA 514 1,096 3 for Free Plan 484 1,032 70 L I L CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 C. PARTICIPANTS As of the actuarial valuation dated January 1, 2010, participants consisted of: Retirees and beneficiaries currently purchasing health insurance through the City 3 Disabled police and firefighters Active employees 58 Total 62 Participating employers 1 D. FUNDING POLICY The additional cost of using a blended rate for actives and retirees is currently funded on a pay-as-you- go basis. The City Council may change the funding policy at any time. E. ANNUAL OPEB COSTS AND NET OPEB OBLIGATION The City's annual other post employment benefit (OPEB) cost is calculated based on the annual required contribution (ARC) of the employer, an amount actuarially determined in accordance with the parameters of GASB Statement No. 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed 30 years. The net OPEB obligation as of December 31, 2011, was calculated as follows: Annual required contribution (ARC) $97,752 Interest on net OPEB obligation 7,649 Adjustment to ARC (6,033) Adjustment for 2009 and 2010 costs assumed to be equal - Annual OPEB cost 99,368 Contributions made during the year (23,435) Increase (decrease) in net OPEB obligation 75,933 Net OPEB obligation - beginning of year 169,973 Net OPEB obligation - end of year $245,906 For the governmental activities, the net OPEB obligation is generally liquidated by the General Fund. 71 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31. 2011 The City had an actuarial valuation performed for the plan as of January 1, 2010 to determine the funded status of the plan as of that date as well as the employer's annual required contribution (ARC) for the fiscal year ended December 31, 2011. The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan and the net OPEB obligation for 2009, 2010 and 2011 was as follows: Percentage of Fiscal Year Annual OPEB Employer Annual OPEB Cost Net OPEB Ended Cost Contributions Contributed Obligation December 31, 2009 $116,485 $27,350 23.0% $89,135 December 31, 2010 98,169 17,331 18.0% 169,973 December 31, 2011 99,368 23,435 18.0% 245,906 F. FUNDED STATUS AND FUNDING PROGRESS The City currently has no assets that have been irrevocably deposited in a trust for future health benefits; therefore, the actuarial value of assets is zero. The funded status of the plan was as follows: Unfunded Actuarial Actuarial UAAL as a Actuarial Actuarial Accrued Accrued Funded Covered Percentage of Valuation Value of Assets Liability (AAL)* Liability (URAL) Ratio Payroll Covered Payroll Date (a) (b) (b -a) (alb) (c) ((b -a) / c) January I, 2010 $0 $835,974 $835,974 0.00% $3,543,870 23.59% 'Using the Projected Unit Credit Actuarial cost method. G. ACTUARIAL METHODS AND ASSUMPTIONS Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality and the health care cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions (ARC) of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The schedule of funding progress, presented as required supplementary information following the notes to the financial statements, presents multi-year trend information that shows whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effect of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. 72 M CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 In the January 1, 2010 actuarial valuation, the Projected Unit Credit Actuarial cost method was used. The actuarial assumptions included a 4.5% investment rate of return (net of administrative expenses), an initial annual health care cost trend rate of 9% reduced by .33% each year to arrive at an ultimate health care cost trend rate of 5.0% and an inflation rate of 3%. The actuarial value of assets was $0. The plan's unfunded actuarial accrued liability is being amortized using the level percentage of projected payroll method over 30 years on a open basis. Note 8 INTERFUND RECEIVABLES/PAYABLES, LOANS AND TRANSFERS Individual fund interfund receivable and payable balances at December 31, 2011 are as follows: Fund Maj or Funds: General Fund HRA Directed Projects Nomnajor Funds: Recycling Fund HRA Fund 2012 Street Improvement Project Fund Total Receivable Payable $420,091 $ - - 118,871 - 11,745 - 159,862 129,613 $420,091 $420,091 Interfund payables and receivables are representative of lendingiborrowing arrangements to cover deficit cash balances at the end of the fiscal year. Interfund loans: Fund Receivable Payable Purpose t Major funds: Water and Sewer $2,219,990 $ - HRA Projects - 1,000,000 Provide financing for pay off of Fannie Mae loan i Street Improvement Project - 600,000 Provide financing for pay off of Fannie Mae loan Provide financing for escrow required by 2003 public - HRA Debt Service - 437,430 facilities lease Liquor Fund - 109,500 Providing financing for the Market Place Liquor Store ` Nonmaj or funds: Revolving Improvement Fund - 73,060 Provide financing for Arbors Alley Project t Total $2,219,990 $2,219,990 t 73 L. CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Interfund transfers: Transfer out Governmental activities: General Fund HRA Projects Business -type activities: Water and Sewer Fund Liquor Fund Total transfers Transfer In Governmental Activities Major Funds HRA Nonmajor General Debt Governmental Fund Service Fund Total $ $ - $66,100 $66,100 873,321 68,809 942,130 128,000 291,800 50,000 125,400 178,000 417,200 $419,800$873,321 $310,309 $1,603,430 All of the 2011 transfers are considered routine and consistent with previous practices. Note 9 DEFICIT FUND BALANCES/NET ASSETS The City has deficit fund balances/net assets at December 31, 2011 as follows: Fund Amount Major funds: 2009 Street Improvement $28,339 Nonmajor funds: Recycling Fund 11,817 HRA Fund 167,651 Revolving Improvement 48,597 2012 Street Improvement 171,141 Internal Service Fund 628,857 These deficits will be eliminated by charges to other funds. 74 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Note 10 CONTINGENCIES A. RISK MANAGEMENT The City is exposed to various risks of loss related to torts, theft of, damage to and destruction of assets; errors and omissions; injuries to employees; and natural disasters. Workers compensation coverage is provided through a pooled self-insurance program through the League of Minnesota Cities Insurance Trust (LMCIT). The City pays an annual premium to the LMCIT. The City is subject to supplemental assessments if deemed necessary by the LMCIT. The LMCIT reinsures through Workers Compensation Reinsurance Association (WCRA) as required by law. The City has no deductible and a managed care program to assist employees with their rehabilitation plan. Annual employee hours of service are audited and final premiums are then determined. The amount of premium adjustment, if any, is considered immaterial and not recorded until received or paid. Property, casualty and automobile insurance coverage are provided through a pooled self-insurance program through the LMCIT. The City pays an annual premium to the LMCIT. The City is subject to supplemental assessments if deemed necessary by the LMCIT. The LMCIT reinsures through commercial companies for claims in excess of various amounts. The City retains risk for the deductible portions. These deductibles are considered immaterial to the financial statements. The City continues to carry commercial insurance for all other risks of loss, including liquor liability, employee health and disability insurance. There were no significant reductions in insurance from the previous year or settlements in excess of insurance coverage for any of the past three fiscal years. B. LITIGATION The City has indicated that existing and pending lawsuits, claims and other actions in which the City is a defendant are either covered by insurance; of an immaterial amount; or, in the judgment of the City, remotely recoverable by plaintiffs. C. FEDERAL AND STATE FUNDS The City receives financial assistance from federal and state governmental agencies in the form of grants. The disbursement of funds received under these programs generally requires compliance with the terms and conditions specified in the grant agreements and are subject to audit by the grantor agencies. Any disallowed claims resulting from such audits could become a liability of the applicable fund. However, in the opinion of management, any such disallowed claims will not have a material effect on any of the financial statements included herein or on the overall financial position of the City at December 31, 2011. 75 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 D. TAX INCREMENT DISTRICTS The City's tax increment districts are subject to review by the State of Minnesota Office of the State Auditor (OSA). Any disallowed claims or misuse of tax increments could become a liability of the applicable fund. Management has indicated that they are not aware of any instances of noncompliance which would have a material effect on the financial statements. E. PAY-AS-YOU-GO TAX INCREMENT The City has two tax increment pay-as-you-go agreements. The agreements are not a general obligation of the City and is payable solely from available tax increment. Accordingly, this agreement is not reflected in the financial statements of the City. Details of the pay-as-you-go notes are as follows: TIF District #3-5, Landings at Silver Lake Village: The pay-as-you-go note provides for the payment to the developer for 90% of all tax increment received in the prior six months. The payment reimburses the developer for street, utilities, right-of- way, land acquisition, and other public improvements. Principal and interest payments will be completed February 1, 2031. TIF District #3-5, Phase 11 Town Homes: The pay-as-you-go note provides for the payment to the developer for 95% of all tax increment received in the prior six months. The payment reimburses the developer for streets, utilities, right- of-way, land acquisition, and other public improvements. Principal and interest payments will be completed February 1, 2031. F. ARBITRAGE The City issued greater than $5 million of bonds in the years 2003, 2006, 2007 and 2011 and, therefore; is required to rebate excess investment income relating to these issues to the federal government. The City calculates arbitrage rebate every five years as permitted by arbitrage regulations. The extent of the City's liability for arbitrage rebates for bond issues not currently requiring five year rebate calculations is not determinable at this time. However, in the opinion of management, any such liability would be immaterial. Note 11 DEFERRED AD VALOREM TAX LEVIES -BONDED DEBT General obligation bond issues sold by the City are financed by ad valorem tax levies and improvement bond issues sold by the City are partially financed by ad valorem tax levies in addition to special assessments levied against the benefiting properties. When a bond issue to be financed partially or completely by ad valorem tax levies is sold, specific annual amounts of such tax levies are stated in the bond resolution and the County Auditor is notified and instructed to levy these taxes over the appropriate years. The future tax levies are subject to cancellation when and if the City has provided alternative sources of financing. The City Council is required to levy any additional taxes found necessary for full payment of principal and interest. These future scheduled tax levies are not shown as assets in the accompanying financial statements at December 31, 2011. 76 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31. 2011 Note 12 FUND BALANCE/FUND EOUITY A. CLASSIFICATIONS At December 31, 2011, a summary of the governmental fund balance classifications are as follows: Nonspendable: Prepaid items Restricted for: Tax increment Public safety Debt service Total restricted Committed to: Community center operstions/maimcnance Revolving loan program Total committed Assigned to: Community center operations/maintenance Street impswcane rts/rehabilitiation Storm water improvements Development purposes Public safety Parks and recreation Total assigned i Unassigned Total Nonspendable: Prepaid items Restricted for: Tax increment Public safety Debt service Total restricted Committed to: Community center operations/maintenance Revolving loan program Total committed Assigned to: Community center operations/maintenance Street improvements/rehabilitialion Storm water improvements Development purposes Public safety Parks and recreation Total assigned Unassigned Total Street Improvement HRA Street storm Debt Debt Improvement HRA Water General Fund Service Service Projects Projects Improvement $55,271 $ $ $ $ $ _ 3,442,836 524,198 3,442,836 524,198 - 1,498,134 - 1,498,134 _ 91,018 91,018 354,111 - 9,798 354,111 9,798 1,647,566 (813,009) - $1,702,837 $3,442,836 $524,198 $354,111 $776,143 $9,798 Silver 2009 2011 take Street Street Road Improvement Improvement Project Project Project Other Funds Total $ $ $ $132 $55,403 - 1,498,134 16,281 16,281 _ 1,386,671 5,353,705 1,402,952 6,868,120 119,935 119,935 91,018 119,935 210,953 - - - 4,913 4,913 544 - 189,591 57,651 601,897 - - 9,798 42,887 42,887 10,763 10,763 93,409 93,409 544 189,591 209,623 763,667 (28,339) (399,230) 406,988 $544 ($28,339) $189,591 $1,333,412 $8,305,131 77 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31. 2011 B. MINIMUM UNASSIGNED FUND BALANCE POLICY The City Council has formally adopted a policy regarding the minimum unassigned fund balance for the General Fund. The most significant revenue source of the General Fund is property taxes. This revenue source is received in two installments during the year — June and December. As such, it is the City's goal to begin each fiscal year with sufficient working capital to fund operations between each semi-annual receipt of property taxes. The policy establishes a year-end targeted unassigned fund balance amount for cash-flow timing needs in the range of 30-35% of the subsequent year's budgeted operating expenditures (net of expenditures for police services to other cities). At December 31, 2011, the unassigned fund balance of the General Fund was 36.88% of the subsequent year's budgeted expenditures. Note 13 CONDUIT DEBT OBLIGATION From time to time, the City has issued Multi -family Housing Revenue Bonds to provide financial assistance to private -sector entities for the acquisition and construction of rental housing deemed to be in the public interest. The bonds are secured by the property financed and are payable solely from payments received on the underlying mortgage loans. Upon repayment of the bonds, ownership of the acquired facilities transfers to the private -sector entity served by the bond issuance. Neither the City, the State, nor any political subdivision thereof is obligated in any manner for repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the accompanying financial statements. As of December 31, 2011, there were six series of Multi -family Housing Revenue Bonds outstanding. The aggregate issued amount was $54,735,000, including two 1996 issues totaling $7,200,000, a 2002 issue of $7,775,000 and three 2004 issues of $39,760,000. The balance outstanding at December 31, 2011 is unavailable. Note 14 PUBLIC FACILITIES LEASE In 2003 the City, via the Housing and Redevelopment Authority (HRA), issued $5,530,000 of Public Facilities Lease Revenue Bonds. Proceeds from these bonds were utilized to finance the renovation of public works facilities and construction of a new fire station/hall. Bond proceeds were placed into an escrow account. The City received reimbursement from the trustee as costs are incurred by the City. To assist in financing the project the City transferred $157,000 from its Water and Sewer Fund in 2003. 78 CITY OF ST. ANTHONY, MINNESOTA I NOTES TO FINANCIAL STATEMENTS December 31, 2011 I In connection with this bond issue, the City entered into a lease agreement with the HRA for the use of these facilities. Terms of the lease require the City to pay rents annually in amounts to satisfy the debt service requirements related to the bond issued by the HRA. In addition, the City advanced $437,360 to the bond trustee to initially fund the bond reserve requirements of the agreement. The net book value of assets under this lease agreement at December 31, 2011 are as follows: Land $1,294,541 Buildings and structures 4,887,598 Furniture, fixtures and equipment 30,902 Accumulated depreciation (1,236,832) Net $4,976,209 Note 15 OPERATING LEASES Sprint Clearwire The City leases space above its water towers to Sprint Spectrum. The space is used for antennas and other equipment necessary to provide radio communications. Lease terms are as follows: 23,835 2011 Annual Lease Initial 27,447 Lease Adjustment Expiration Automatic Lessee Amount Factor Date Renewals Sprint Spectrum $22,037 4% 2/27/14 3-5 year terms Clearw ire Communications 24,400 4% 7/10/14 5-5 year terms Future minimum lease payments are as follows: Fig Sprint Clearwire Spectrum Communications 2012 $22,918 $25,376 2013 23,835 26,391 2014 24,788 27,447 2015 25,780 28,545 2016 26,811 29,686 2017-2021 151,028 167,222 2022-2026 183,748 203,452 2027-2031 87,791 247,530 2032-2036 - 301,158 2037-2046 - 254,832 Total $546,699 $1,311,639 Fig CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31. 2011 Note 16 LEGAL DEBT MARGIN The City is subject to a statutory limitation by the State of Minnesota for bonded indebtedness payable principally from property taxes. The City's legal debt margin for 2011 is computed as follows: Note 17 RECENTLY ISSUED ACCOUNTING STANDARDS The Governmental Accounting Standards Boards (GASB) recently approved the following statements which were not implemented for these financial statements: Statement No. 60 Accounting and Financial Reportingfor Service Concession Arrangements. The provisions of this Statement are effective for financial statements for periods beginning after December 15, 2011. Statement No. 61 The Financial Reporting Entity Omnibus —An Amendment of GASB No. 14 and No. 34. The provisions of this Statement are effective for financial statements for periods beginning after June 15, 2012. Statement No. 63 Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources and Net Position. The provisions of this Statement are effective for financial statements for periods beginning after December 15, 2011. Statement No. 65 Items Previously Reported as Assets and Liabilities. The provisions of this Statement are effective for financial statements for periods beginning after December 15, 2012. Statement No. 66 Technical Corrections — 2012. The provisions of this Statement are effective for financial statements for periods beginning after December 15, 2012. The effect these standards may have on future financial statements is not determinable at this time. 80 December 31, 2011 Market value: Ramsey County $275,647,400 Hennepin County 463,828,500 Total market value 739,475,900 Debt limit percentage 3.00% Debt limit 22,184,277 Amount of debt applicable to debt limit Total bonded debt 35,865,000 Less nonapplicable debt: Revenue bonds (liquor, water, sewer, storm sewer) (2,205,000) State aid street bonds (250,000) Tax abatement bonds (1,600,000) Improvement bonds (16,645,000) Tax increment bonds (9,345,000) Cashand investments inapplicable debt service funds (1,111,699) Total amount of debt applicable to debt limit 4,708,301 Legal debt margin $17,475,976 Note 17 RECENTLY ISSUED ACCOUNTING STANDARDS The Governmental Accounting Standards Boards (GASB) recently approved the following statements which were not implemented for these financial statements: Statement No. 60 Accounting and Financial Reportingfor Service Concession Arrangements. The provisions of this Statement are effective for financial statements for periods beginning after December 15, 2011. Statement No. 61 The Financial Reporting Entity Omnibus —An Amendment of GASB No. 14 and No. 34. The provisions of this Statement are effective for financial statements for periods beginning after June 15, 2012. Statement No. 63 Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources and Net Position. The provisions of this Statement are effective for financial statements for periods beginning after December 15, 2011. Statement No. 65 Items Previously Reported as Assets and Liabilities. The provisions of this Statement are effective for financial statements for periods beginning after December 15, 2012. Statement No. 66 Technical Corrections — 2012. The provisions of this Statement are effective for financial statements for periods beginning after December 15, 2012. The effect these standards may have on future financial statements is not determinable at this time. 80 CITY OF ST. ANTHONY, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2011 Note 18 ACCOUNTING CHANGE, IMPLEMENTATION OF GASB 54 The City adopted the provisions of Governmental Accounting Standards Board Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions for the year ended December 31, 2011. Changes to the reporting of the fund balance of the governmental funds is reflected in the financial statements and related disclosures in Note 1.0 and Note 12. The implementation of GASB Statement 54 also resulted in the reclassification of certain funds and the restatement of the City's financial statements. A summary of these changes are as follows: Fund balance / net assets - December 31, 2010, as previously reported Reclassification of Water Fi Itration and Purification Fund Fund balarce / net assets - Jamary 1, 2011, as restated Note 19 PRIOR PERIOD ADJUSTMENT Water and Sewer Businesa- Gow,raneraal Governmental Enterprise Type Funds Activities Funds Activities S 11,705,902 517,165,603 53,528,942 55,651,899 (5,183,068) (5,183,068) 5,183,068 5,183,068 56,522,834 511,982,535 58,712,010 510,834,967 During 2011, corrections to the prior year financial statements were made to correct the amounts recorded as deposits payable and funds held for others at December 31, 2010. A summary of these changes are as follows: Fund balance/net assets - December 31, 2010, as previously reported Prior period adjustments: Deposits payable Funds held by others Total Fund balance/net assets - January 1, 2011, as restated Note 20 SUBSEOUENT EVENTS Governmental Business -Type Activities Activities HRA Water and Project Sewer $554,377 $8,712,010 28,252 (69,318) - (69,318) 28,252 $485,059 $8,740,262 The City issued the $9,495,000 G.O. Bonds, Series 2012A on March 27, 2012 to refund the City's 2003 HRA Lease Revenue Bonds, 2006A Improvement Bonds and 2007A Improvement Bonds and provide new money for the City's 2012 road construction project. 81 L_ This page intentionally left blank - 82 REQUIRED SUPPLEMENTARY INFORMATION 83 CITY OF ST. ANTHONY, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE - GENERAL FUND For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Statement 10 Page 1 of 5 Expenditures: 2011 2010 General government: Budgeted Amounts Actual Variance with Actual Original Final Amounts Final Budget Amounts Revenues: Current: General property taxes $2,842,156 $2,842,156 $2,925,430 $83,274 $2,923,247 Licenses and permits 246,500 246,500 195,563 (50,937) 224,096 Intergovernmental: Other services and charges 21,400 21,400 20,198 1,202 Federal: Total mayor and council 58,800 58,800 56,432 2,368 Police grants - - 40,032 40,032 31,424 State: Market value homestead credit 1,155 1,155 1,155 - 786 Police aid 157,700 157,700 163,151 5,451 165,472 Fire aid 52,500 52,500 32,574 (19,926) 34,415 Municipal state aid - street maintenance 32,300 32,300 66,813 34,513 65,008 PERA aid 7,200 7,200 7,197 (3) 7,197 Police grants - - 13,196 13,196 7,505 County: Street maintenance 26,400 26,400 29,853 3,453 31,837 Other 2,700 2,700 9,785 7,085 4,635 Local: School District DARE 14,500 14,500 14,500 - 14,500 Other 4,000 4,000 12,837 8,837 9,733 Total intergovernmental 298,455 298,455 391,093 92,638 372,512 Charges for services: Police contracts 1,180,334 1,180,334 1,180,334 - 1,157,190 Cable franchise fees 90,000 90,000 96,608 6,608 92,786 Antenna rental - water tower 46,100 46,100 46,481 381 32,286 Administrative charges 28,600 28,600 28,600 - 28,600 Other 10,825 10,825 6,409 (4,416) 6,757 Total charges for services 1,355,859 1,355,859 1,358,432 2,573 1,317,619 Fines and forfeits 118,500 118,500 107,053 (11,447) 106,176 Contributions and donations 300 300 610 310 1,784 Other revenue: Investment income 20,500 20,500 89 (20,411) 659 Miscellaneous - other 51,030 51,030 105,460 54,430 45,582 Total other revenue 71,530 71,530 105,549 34,019 46,241 Total revenues 4,933,300 4,933,300 5,083,730 150,430 4,991,675 Expenditures: General government: Mayor and council: Current: Personal services 36,800 36,800 35,709 1,091 35,843 Materials and supplies 600 600 525 75 686 Other services and charges 21,400 21,400 20,198 1,202 17,864 Total mayor and council 58,800 58,800 56,432 2,368 54,393 84 L CITY OF ST. ANTHONY, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE - GENERAL FUND For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Statement 10 Page 2 of 5 85 2011 2010 Budgeted Amounts Actual Variance with Actual Original Final Amounts Final Budget Amounts Expenditures: (continued) General government: (continued) Intergovernmental relations: Current: Contracted services $25,600 $25,600 $22,505 $3,095 $19,616 Public relations/cable: Current: Personal services 14,000 14,000 12,685 1,315 11,730 Supplies 300 300 148 152 44 Other services and charges 23,800 23,800 23,978 (178) 24,632 Total public relations/cable 38,100 38,100 36,811 1,289 36,406 General management: Current: Personal services 100,600 100,600 93,297 7,303 96,948 Supplies 200 200 793 (593) 446 Other services and charges 8,600 8,600 8,851 (251) 7,288 Total general management 109,400 109,400 102,941 6,459 104,682 Elections: Current: Personal services 22,600 22,600 18,128 4,472 21,386 Supplies 1,400 1,400 1,143 257 1,250 Other services and charges 5,000 5,000 5,726 (726) 2,981 Total elections 29,000 29,000 24,997 4,003 25,617 Finance: Current: Personal services 98,200 98,200 99,390 (1,190) 96,861 Supplies 11,600 11,600 11,538 62 7,768 Other services and charges 176,500 176,500 157,521 18,979 152,084 Total finance 286,300 286,300 268,449 17,851 256,713 Assessing: Current: Personal services 3,300 3,300 3,245 55 3,170 Supplies 200 200 38 162 38 Other services and charges 41,200 41,200 43,656 (2,456) 41,959 Total assessing 44,700 44,700 46,939 (2,239) 45,167 Legal: Current: Contracted services 75,000 75,000 78,161 (3,161) 62,446 Planning and zoning: Current Supplies 200 200 4 196 62 Other services and charges 5,000 5,000 1,125 3,875 5,255 Total planning and zoning 5,200 5,200 1,129 4,071 5,317 85 CITY OF ST. ANTHONY, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE - GENERAL FUND For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Expenditures: (continued) General government: (continued) General government buildings: Current: Supplies Other services and charges Total general government buildings Total general government Public safety: Civil defense: Current: Personal services Supplies Other services and charges Total civil defense Police protection: Current: Personal services Supplies Other services and charges Total police protection Fire protection: Current: Personal services Supplies Other services and charges Total fire protection Protective inspections: Current: Personal services Supplies Other services and charges Total protective inspections DARE program: Current: Personal services Supplies Other services and charges Total DARE program Statement 10 Page 3 of 5 $100 2011 $192 2010 Budgeted Amounts Actual Variance with Actual Original Final Amounts Final Budget Amounts $100 $100 $192 ($92) $ - 114,300 114,300 108,997 5,303 104,263 114,400 114,400 109,189 5,211 104,263 786,500 786,500 747,553 38,947 714;620 54,900 54,900 53,116 1,784 53,776 1,200 1,200 1,430 (230) 1,046 3,600 3,600 4,157 (557) 4,132 59,700 59,700 58,703 997 58,954 1,468,420 1,468,420 1,522,632 (54,212) 1,487,842 78,900 78,900 83,965 (5,065) 55,644 89,580 89,580 57,740 31,840 53,999 1,636,900 1,636,900 1,664,337 (27,437) 1,597,485 780,300 780,300 778,377 1,923 756,450 21,800 21,800 23,362 (1,562) 16,645 37,900 37,900 46,998 (9,098) 37,803 840,000 840,000 848,737 (8,737) 810,898 10,600 10,600 10,525 75 10,318 100 100 - 100 - 99,800 99,800 70,839 28,961 75,307 110,500 110,500 81,364 29,136 85,625 12,000 12,000 12,432 (432) 10,014 2,000 2,000 2,795 (795) 2,696 500 500 - 500 - 14,500 14,500 15,227 (727) 12,710 M CITY OF ST. ANTHONY, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE - GENERAL FUND For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Statement 10 Page 4 of 5 Public works: 2011 2010 Street maintenance: Budgeted Amounts Actual Variance with Actual Original Final Amounts Final Budget Amounts Expenditures: (continued) Personal services 341,500 341,500 357,025 (15,525) Public safety: (continued) Supplies 90,200 90,200 84,403 5,797 Animal control: Other services and charges 85,600 85,600 97,864 (12,264) Current: Total street maintenance 517,300 517,300 539,292 (21,992) Supplies $400 $400 $71 $329 $ - Contracted services 2,400 2,400 3,378 (978) 2,687 Total animal control 2,800 2,800 3,449 (649) 2,687 Total public safety 2,664,400 2,664,400 2,671,817 (7,417) 2,568,359 Public works: Street maintenance: Current: Personal services 341,500 341,500 357,025 (15,525) 354,707 Supplies 90,200 90,200 84,403 5,797 105,964 Other services and charges 85,600 85,600 97,864 (12,264) 97,600 Total street maintenance 517,300 517,300 539,292 (21,992) 558,271 Equipment maintenance: Current: Personal services 42,200 42,200 42,075 125 41,446 Supplies 31,500 31,500 40,733 (9,233) 33,930 Other services and charges 8,800 8,800 10,627 (1,827) 10,107 Total equipment maintenance 82,500 82,500 93,435 (10,935) 85,483 Tree and weed care: Current: Personal services 32,600 32,600 32,857 (257) 32,717 Supplies 200 200 - 200 - Other services and charges 3,400 3,400 3,998 (598) 4,384 Total tree and weed care 36,200 36,200 36,855 (655) 37,101 Total public works 636,000 636,000 669,582 (33,582) 680,855 Parks and recreation: Park maintenance: Current: Personal services 135,400 135,400 123,797 11,603 137,646 Supplies 6,300 6,300 3,976 2,324 4,980 Other services and charges 35,000 35,000 29,100 5,900 28,690 Total park maintenance 176,700 176,700 156,873 19,827 171,316 Recreation: Current: Community services 52,200 52,200 52,176 24 52,176 Total parks and recreation 228,900 228,900 209,049 19,851 223,492 I CITY OF ST. ANTHONY, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE - GENERAL FUND For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Statement 10 Page 5 of 5 RE 2011 2010 Budgeted Amounts Actual Variance with Actual Original Final Amounts Final Budget Amounts Expenditures: (continued) Services to other cities: Police services - contract allocation amount: Personal services $981,180 $981,180 $988,837 ($7,657) $970,305 Supplies 20,600 20,600 16,652 3,948 12,114 Other services and charges 54,320 54,320 33,520 20,800 34,060 Total services to other cities 1,056,100 1,056,100 1,039,009 17,091 1,016,479 Nondepartmental: Personal services - - 5,394 (5,394) 2,909 Supplies 633 (633) 1,102 Workers compensation insurance - - 16,256 (16,256) 2,929 Total nondepartmental 0 0 22,283 (22,283) 6,940 Total expenditures 5,371,900 5,371,900 5,359,293 12,607 5,210,745 Revenues over(under)expenditures (438,600) (438,600) (275,563) 163,037 (219,070) Other financing sources (uses): Transfers in 419,800 419,800 419,800 - 419,800 Transfers out (66,100) (66,100) (66,100) (66,100) Total other financing sources (uses) 353,700 353,700 353,700 0 353,700 Net change in fund balance ($84,900) ($84,900) 78,137 $163,037 134,630 Fund balance - January 1, as previously reported 1,624,700 1,525,433 Prior period adjustment - (35,363) Fund balance - January 1, as restated 1,624,700 1,490,070 Fund balance - December 31 $1,702,837 $1,624,700 RE CITY OF ST. ANTHONY, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE NOTE TO RSI December 31, 2011 Note A BUDGETS The General Fund budget is legally adopted on a basis consistent with accounting principles generally accepted in the United States of America. The legal level of budgetary control is at the department level for the General Fund. 89 CITY OF ST. ANTHONY, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION Statement 11 SCHEDULE OF FUNDING PROGRESS OTHER POST EMPLOYMENT BENEFITS PLAN For The Year Ended December 31, 2011 The City implemented GASB Statement No. 45 for the fiscal year ended December 31, 2009. Information for prior years is not available. .N (1) (2) (3) (4) (5) (6) Unfunded Actuarial Accrued Active UAAL As A Actuarial Actuarial Actuarial Funded Liability Members Percentage of Valuation Value of Accrued Ratio (UAAL) Covered Covered Date Assets Liability (AAL) (1)/(2) (2)-(l) Payroll Payroll (4) / (5) January 1, 2009 $ $1,160,956 0.00% $1,160,956 $3,383,647 34.31% January 1, 2010 835,974 0.00% 835,974 3,543,870 23.59% The City implemented GASB Statement No. 45 for the fiscal year ended December 31, 2009. Information for prior years is not available. .N COMBINING AND INDIVIDUAL NONMAJOR FUND FINANCIAL STATEMENTS AND SCHEDULES 91 - This page intentionally lett blank - 92 NONMAJOR GOVERNMENTAL FUNDS ys SPECIAL REVENUE FUNDS Special Revenue Funds are used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. DEBT SERVICE FUNDS Debt Service Funds are used to account for the accumulation of resources for, and payment of, interest, principal and related costs on long-term debt. CAPITAL PROJECT FUNDS Capital Project Funds account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by Proprietary Funds). 94 CITY OF ST. ANTHONY, MINNESOTA 1 COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS December 31, 2011 I 0 Assets Cash and investments Accrued interest Due from other governmental units Accounts receivable - net Prepaid items Property taxes receivable: Delinquent Due from county Special assessments receivable Total assets Liabilities and Fund Balance Liabilities: Accounts payable Interfund payable Interfund loan payable Due to other governmental units Salaries payable Deferred revenue Total liabilities Fund balance: Nonspendable Restricted Committed Assigned l Unassigned Total fund balance Total liabilities and fund balance L Special Debt Capital Revenue Service Project Statement 12 Totals Nonmajor Governmental Funds 2011 $155,593 $1,380,490 $234,327 $1,770,410 249 - - 249 - - 10,000 10,000 21,638 - - 21,638 132 - - 132 1,087 8,143 - 9,230 741 3,608 - 4,349 - 489,929 47,094 537,023 16,281 $179,440 $1,882,170 $291,421 $2,353,031 $33,612 $ $67,544 $101,156 171,607 129,613 301,220 - 73,060 73,060 72 - 72 530 - 530 1,087 495,499 46,995 543,581 206,908 495,499 317,212 1,019,619 132 - - 132 16,281 1,386,671 1,402,952 119,935 - - 119,935 15,676 193,947 209,623 (179,492) - (219,738) (399,230) (27,468) 1,386,671 (25,791) 1,333,412 $179,440 $1,882,170 S291,421 52,353,031 95 CITY OF ST. ANTHONY, MINNESOTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND Statement 13 CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Other financing sources Bonds issued - 52,903 - Totals 1,375,000 Premium on debt issued Special Debt Capital Nonmajor Governmental Funds 402 Revenue Service Project 2011 2010 Revenues: Transfers in 66,100 68,809 175,400 310,309 General property taxes $106,877 $546,194 $ - $653,071 $551,479 Intergovernmental 19,109 107,571 287,282 413,962 855,184 Special assessments - 186,930 6,360 193,290 153,358 Charges for services 134,216 150,828 3,500 288,544 281,264 Forfeited property 10,782 - - 10,782 21,989 Investment income 6,217 72 25 6,314 21,250 Contributions and donations - - - - 1,050 Other 42,069 - 635 42,704 45,316 Total revenues 319,270 991,595 297,802 1,608,667 1,930,890 Expenditures: Current: General government 12,559 - 77,296 89,855 134,144 Public safety 16,268 - 12,243 28,511 47,393 Public works - - 9,100 9,100 5,867 Parks and recreation 157,104 - - 157,104 165,316 Housing and development 227,921 - - 227,921 183,513 Capital outlay: General government - - 12,661 12,661 - Public safety - - 152,405 152,405 67,850 Public works - - 112,158 112,158 212,029 Debt service: Principal - 480,000 - 480,000 660,000 Interest - 282,460 - 282,460 290,765 Paying agent fees - 1,646 - 1,646 959 Professional service - 4,490 - 4,490 854 Construction/acquistion costs 29,255 - 239,012 268,267 1,976,947 Total expenditures 443,107 768,596 614,875 1,826,578 3,745,637 Revenues over(under)expenditures (123,837) 222,999 (317,073) (217,911) (1,814,747) Other financing sources Bonds issued - 52,903 - 52,903 1,375,000 Premium on debt issued - - - - 402 Sale of capital assets - - 9,982 9,982 15,347 Transfers in 66,100 68,809 175,400 310,309 224,300 Total other financing sources 66,100 121,712 185,382 373,194 1,615,049 Net change in fund balance (57,737) 344,711 (131,691) 155,283 (199,698) Fund balance - January I, as previously reported 30,269 1,041,960 105,900 1,178,129 1,382,867 Prior period adjustment - - - - (5,040) Fund balance - January 1, as restated 30,269 1,041,960 105,900 1,178,129 1,377,827 Fund balance -December 31 ($27,468) $1,386,671 ($25,791) $1,333,4/12 $1,178,129 l� 96 NONMAJOR SPECIAL REVENUE FUNDS The City's Special Revenue Funds are used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. The City of St. Anthony, Minnesota had the following Special Revenue Funds during the year: Community Center Fund is used to account for the operation and maintenance of City Hall and Community Services. Police Forfeiture Fund is used to account for revenue and expenditures related to the forfeiture of property. Recycling Fund is used to account for the City's recycling program. It incorporates the activities of both Hennepin and Ramsey Counties. HRA Fund was established to oversee the commercial and residential redevelopment activities in the community. Fire Education / Trainine Fund was established to account for revenues and expenditures related to training provided to police and fire personnel. 97 L - This page intentionally left blank - W CITY OF ST. ANTHONY, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS December 31, 2011 Statement 14 240 Fire Totals 601 230 Police 225 Education / Nonmajor Community Forfeiture Recycling 301 HRA Training Special Center Fund Fund Fund Fund Fund Revenue 2011 Assets Cash and investments $134,342 $17,829 $ - S - $3,422 $155,593 Accrued interest - - - 249 - 249 Accounts receivable - 5,793 - 15,845 - 21,638 Prepaid items 108 - 24 - - 132 Property taxes receivable: Delinquent - - 1,087 - 1,087 Due from county - - - 741 - 741 Total assets $134,450 $23,622 $24 $17,922 $3,422 $179,440 Liabilities and Fund Balance Liabilities: Accounts payable $8,988 $ $ - $24,624 $ - $33,612 Interfund payable - 11,745 159,862 - 171,607 Due to other governmental units 72 - - - - 72 Salaries payable 434 96 - - 530 Deferred revenue - - - 1,087 - 1,087 Total liabilities 9,494 0 11,841 185,573 0 206,908 Fund balance: Nonspendable 108 - 24 - - 132 Restricted - 16,281 - - - 16,281 Committed 119,935 - - - 119,935 Assigned 4,913 7,341 - 3,422 15,676 Unassigned - - (11,841) (167,651) - (179,492) Total fund balance 124,956 23,622 (11,817) (167,651) 3,422 (27,468 Total liabilities and fund balance $134,450 $23,622 $24 $17,922 $3,422 $179,440 CITY OF ST. ANTHONY, MINNESOTA SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR SPECIAL REVENUE FUNDS For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Expenditures: 601 Community 230 Police Current: Center Fund Forfeiture Fund Revenues: _ _ General property taxes $ _ $ _ Intergovernmental: 157,104 _ State - market value homestead credit _ _ Local- other - 10,676 Charges for services: _ Administrative fees - 29,255 Rental receipts 125,000 - Forfeited property - 10,782 Investment income 11 3 Other 66,100 - Total revenues 125,011 21,461 Expenditures: Current: General government _ _ Public safety - 10,242 Parks and recreation 157,104 _ Housing and development _ _ Capital outlay: Public safety _ Construction/acquistion costs - 29,255 Total expenditures 157,104 39,497 Revenues over(under)expenditures (32,093) (18,036) Other financing sources (uses): Transfers in 66,100 - Net change in fund balance 34,007 (18,036) Fund balance - January 1, as previously reported 90,949 41,658 Prior period adjustment _ - Fund balance - January 1, as restated 90,949 41,658 Fund balance - December 31 $124,956 $23,622 100 I n 225 Recycling Fund 4,893 2,487 7,380 12,559 12,559 (5,179) (5,179) (6,638) (6,638) ($11,817) 301 HRA Fund $106,877 3,540 6,203 41,622 158,242 227,921 227,921 (69,679) (69,679) (97,972) (97,972) ($167,651) 240 Fire Education / Training Fund 6,729 447 7,176 6,026 6,026 1,150 1,150 2,272 2,272 $3,422 101 Statement 15 Totals Nonmajor Special Revenue Funds 2011 2010 $106,877 $108,925 3,540 3,487 15,569 5,807 9,216 5,833 125,000 125,000 10,782 21,989 6,217 20,301 42,069 15,516 319,270 306,858 12,559 16,268 157,104 227,921 29,255 443,107 (123,837) 66,100 (57,737) 30,269 30,269 (527,468) 36,565 18,128 165,316 183,513 41,406 444,928 (138,070) 66,100 (71,970) 103,616 (1,377) 102,239 530,269 - This page intentionally left blank - 102 L t i L. NONMAJOR DEBT SERVICE FUNDS The City's Debt Service Funds are used to account for the accumulation of resources for, and payment of, interest, principal and related costs of long-term debt other than proprietary fund debt. The City of St. Anthony, Minnesota had the following nonmajor Debt Service Funds during the year. Storm Water Fund was established to account for the debt service associated with 100 -Year Flood Protection and infrastructure improvements. State Aid Street Fund accounts for debt service for road construction projects of high traffic roads in the Village. Funding is provided by the State of Minnesota - State Aid. Tax Abatement Fund was established to account for debt service payments associated with the improvements to City parks. Equipment Certificates Fund was established for major capital equipment purchases. Silver Lake Road Bond Fund was established to account for the debt service associated with the reconstruction and infrastructure improvements of Silver Lake Road. 2009 Street Improvement Bond Fund was established to account for the debt service associated with the reconstruction and infrastructure improvements to Chandler Drive and Foss Road. 2010 Street Improvement Bond Fund was established to account for the debt service associated with the reconstruction improvements to Silver Lane and the overlay of portions of Old Highway 8 and Highcrest Road. 2011 Street Improvement Bond Fund was established to account for the debt service associated with the reconstruction improvements to Belden Drive, Coolidge Street, Harding Street and Edward Street. Sidewalk improvements along 39`h Ave are also included. 103 CITY OF ST. ANTHONY, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR DEBT SERVICE FUNDS December 31, 2011 With Comparative Totals For December 31, 2010 Assets Cash and investments Property taxes receivable: Delinquent Due from county Special assessments receivable Total assets Liabilities and Fund Balance Liabilities: Deferred revenue Fund balance: Restricted Total liabilities and fund balance 703 Storm Water 207 State Aid Street 502 Tax Abatement Fund Fund Fund 104 $140,768 $74,747 $208,187 1,961 888 $140,768 $74,747 $211,036 $ - $ $1,961 140,768 74,747 209,075 $140,768 $74,747 $211,036 r L Statement 16 H U u $15 $2,937 $206,193 $54,421 $229,972 $495,499 512 2009 Street 516 2011 Street 402 Equipment 365 Silver Lake Improvement Bond 514 2010 Street Improvement Bond Totals Nonmajor Certificates Fund Road Bond Fund Fund Project Fund Debt Service Funds $15,858 $156,755 $644,303 $197,036 $441,667 2011 $15,842 $152,680 $435,488 $141,083 $211,695 $1,380,490 15 2,937 2,133 1,097 - 8,143 1 1,138 938 643 - 3,608 - - 205,744 54,213 229,972 489,929 $15,858 $156,755 $644,303 $197,036 $441,667 $1,882,170 H U u $15 $2,937 $206,193 $54,421 $229,972 $495,499 15,843 153,818 438,110 142,615 211,695 1,386,671 $15,858 $156,755 $644,303 $197,036 $441,667 $1,882,170 105 CITY OF ST. ANTHONY, MINNESOTA SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR DEBT SERVICE FUNDS For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Revenues: General property taxes Intergovernmental: State: MSA state aid Local: ISD - tax abatement Special assessments Charges for services Investment income Total revenues Expenditures: Debt service: Principal Interest Paying agent fees Professional service Total expenditures Revenues over (under) expenditures Other financing sources: Bonds issued Transfers in Total other financing sources (uses) Net change in fund balance Fund balance - January 1, as previously reported Prior period adjustment Fund balance - January 1, as restated Fund balance - December 31 703 Storm Water 207 State Aid 502 Tax 402 Equipment Fund Street Fund Abatement Fund Certificates Fund $ - $ - $143,892 $16 75,966 - 31,605 150,828 - - - 5 1 14 1 150,833 75,967 175,511 17 130,000 65,000 45,000 - 18,900 8,475 52,739 - 98 43 277 - - - 665 - 148,998 73,518 98,681 0 1,835 2,449 76,830 17 0 0 0 0 1,835 2,449 76,830 17 138,933 72,298 132,245 15,826 138,933 72,298 132,245 15,826 $140,768 $74,747 $209,075 $15,843 W Statement 17 107 512 2009 Street 516 2011 Street 75,966 365 Silver Lake Improvement Bond 514 2010 Street Improvement Bond _ Road Bond Fund Fund Project Fund Totals Nonmajor Debt Service Funds 158,784 186,930 146,886 _ 2011 2010 $178,374 $114,262 $109,650 $ - $546,194 $442,554 107 75,966 72,520 _ _ _ _ 31,605 29,982 - 19,681 8,465 158,784 186,930 146,886 _ _ _ _ 150,828 150,431 4 32 7 8 72 369 178,378 133,975 118,122 158,792 991,595 842,742 ' 100,000 140,000 - - 480,000 660,000 67,200 86,817 48,329 - 282,460 290,765 614 - 614 - 1,646 959 3,250 517 58 - 4,490 854 171,064 227,334 49,001 0 768,596 952,578 7,314 (93,359) 69,121 158,792 222,999 (109,836) _ _ - 52,903 52,903 28,145 68,809 - - 68,809 - 0 68,809 0 52,903 121,712 28,145 7,314 (24,550) 69,121 211,695 344,711 (81,691) 146,504 462,660 73,494 - 1,041,960 1,127,314 _ _ _ _ - (3,663) 146,504 462,660 73,494 0 1,041,960 1,123,651 $153,818 5438,110 $142,615 $211,695 S1,386,671 $1,041,960 107 - This page intentionally left blank - 108 NONMAJOR CAPITAL PROJECT FUNDS The City's Capital Project Funds account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by Proprietary Funds). The City of St. Anthony, Minnesota had the following Capital Project Funds during the year: Revolving Improvement Fund was established to provide funding for smaller improvement projects. Park Improvement Fund accounts for the revenues and expenditures associated with the renovations and refurbishing of the City's park system. State Aid Street Fund accounts for the funding and costs of reconstruction for the City's designated State Aid roads. Silver Lake Village Park Fund was established to account for the operation and maintenance of the City's park located in Silver Lake Village. The Park is named "Salo Park" which is in honor of St. Anthony's sister city (Salo, Finland). Capital Equipment Fund is used by all City Departments and accounts for the annual purchases of capital equipment. Building Improvement Fund was established to provide funding for existing City owned building improvements and renovations. 2010 Street Improvement Project Fund accounts for the sidewalk, lighting and street reconstruction improvements to Silver Lane and the bituminous mill and overlay to portions of Old Highway 8 and Highcrest Road. 2012 Street Im rovement Proiect Fund Accounts for continuing street reconstruction along Belden Drive and Coolidge Street along with 35`h Avenue NE. Drainage improvements in the vicinities of Coolidge Street, Harding Street and Lowry Avenue. Repairs to the Macalaster Drive sanitary sewer line will be performed. 109 CITY OF ST. ANTHONY, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR CAPITAL PROJECT FUNDS December 31, 2011 Assets Cash and investments Due from other governmental units Special assessment receivable Total assets Liabilities and Fund Balance Liabilities: Accounts payable Interfund payable Interfind loan payable Deferred revenue Total liabilities Fund balance (deficit): Assigned Unassigned Total fund balance (deficit) Total liabilities and fund balance 509 Revolving Improvement $24,364 47,094 $71,458 501 Park Improvement $36,006 205 State Aid Street $35,938 $36,006 $35,938 $ $ $24 73,060 46,995 120,055 0 24 - 36,006 35,914 (48,597) - - (48,597) 36,006 35,914 $71,458 $36,006 $35,938 110 Statement 18 $ $25,992 510 Building 513 2010 Street 517 2012 Street Totals Nonmajor 350 Silver Lake 401 Capital Improvement Improvement Improvement Capital Project Village Park Equipment Fund Fund Project Fund Project Fund Funds _ _ 2011 $57,403 $57,057 $1,822 $21,737 $ - $234,327 - 10,000 - - - 10,000 - _ _ - - 47,094 $57,403 $67,057 $1,822 $21,737 $0 $291,421 $ $25,992 $ $ $41,528 S67,544 _ 129,613 129,613 _ 73,060 _ _ 46,995 0 25,992 0 0 171,141 317,212 57,403 41,065 1,822 21,737 - 193,947 _ _ _ _ (171,141) (219,738) 57,403 41,065 1,822 21,737 (171,141) (25,791) $57,403 $67,057 $1,822 $21,737 $0 $291,421 111 CITY OF ST. ANTHONY, MINNESOTA SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR CAPITAL PROJECT FUNDS For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Expenditures: General government: Materials and supplies - _ _ _ Capital outlay - _ _ _ Public safety: Materials and supplies - _ _ _ Capital outlay _ _ _ _ Public works: Materials and supplies - 4,681 263 - Contractual services 4,156 - - _ Capital outlay - Construction/acquistion costs - _ _ _ Total expenditures 4,156 4,681 263 0 Revenues over (under) expenditures 2,207 (1,177) (260) 5 Other financing sources: 509 Revolving 501 Park 205 State Aid 350 Silver Lake Improvement Improvement Street Village Park Revenues: Intergovernmental: Premium on debt issued _ State - Municipal state aid $ - $ - State - other _ _ Other - local participation - _ Special assessments 6,360 - Charges for services: Total other financing sources 0 Service charges - 3,500 Investment income 3 4 3 5 Contributions and donations 5 _ Other 37,183 36,174 Total revenues 6,363 3,504 3 5 Expenditures: General government: Materials and supplies - _ _ _ Capital outlay - _ _ _ Public safety: Materials and supplies - _ _ _ Capital outlay _ _ _ _ Public works: Materials and supplies - 4,681 263 - Contractual services 4,156 - - _ Capital outlay - Construction/acquistion costs - _ _ _ Total expenditures 4,156 4,681 263 0 Revenues over (under) expenditures 2,207 (1,177) (260) 5 Other financing sources: Bonds issued _ Premium on debt issued _ Transfers in _ Sale of capital assets _ Total other financing sources 0 0 0 0 Net change in fund balance 2,207 (1,177) (260) 5 Fund balance (deficit) - January 1 (50,804) 37,183 36,174 57,398 Fund balance (deficit) - December 31 ($48,597) $36,006 $35,914 $57,403 112 Statement 19 510 Building 513 2010 Street 517 2012 Street 401 Capital Improvement Improvement Improvement Equipment Fund Fund Project Fund Project Fund Totals Nonmajor Capital Project Funds 2011 2010 $124,474 $ - $ 45,295 - 10,000 - 107,513 10 635 180,414 0 107,513 77,296 12,661 12,243 152,405 112,158 366,763 (186,349) $124,474 $52,502 45,295 0 117,513 644,940 $124,474 $52,502 45,295 45,946 117,513 644,940 6,360 6,472 3,500 - 25 580 - 1,050 635 29,800 297,802 781,290 - 77,296 97,579 - - 12,661 - - - 12,243 29,265 - - 152,405 26,444 - - 4,944 1,416 - - 4,156 4,451 - - 112,158 212,029 67,871 171,141 239,012 1,976,947 67,871 171,141 614,875 2,348,131 39,642 (171,141) (317,073) (1,566,841) 113 1,346,855 _ - 402 175,400 175,400 158,200 9,982 9,982 15,347 185,382 0 0 0 185,382 1,520,804 (967) 0 39,642 (171,141) (131,691) (46,037) 42,032 1,822 (17,905) - 105,900 151,937 $41,065 $1,822 $21,737 ($171,141) ($25,791) $105,900 113 CITY OF ST. ANTHONY, MINNESOTA SPECIAL REVENUE FUND - 601 COMMUNITY CENTER FUND Statement 20 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE -BUDGET AND ACTUAL For The Year Ended December 31, 2011 With Comparative Actual Amounts For The Year Ended December 31, 2010 Revenues: Charges for services: Rental receipts Investment income Total revenues Expenditures: Parks and recreation: Current: Personal services Supplies Contractual services Total expenditures Revenues over (under) expenditures Other financing sources: Transfer from other funds Net change in fund balance Fund balance - January 1 Fund balance - December 31 13,400 2011 12,944 Budgeted Amounts 2010 Original Final Actual Actual $125,000 $125,000 $125,000 $125,000 2,000 2,000 11 57 127,000 127,000 125,011 125,057 13,400 13,400 12,944 12,999 1,000 1,000 373 952 183,300 183,300 143,787 151,365 197,700 197,700 157,104 165,316 (70,700) (70,700) (32,093) (40,259) 66,100 66,100 66,100 66,100 ($4,600) ($4,600) 114 34,007 25,841 90,949 65,108 $124,956 $90,949 1 CITY OF ST. ANTHONY, MINNESOTA SPECIAL REVENUE FUND - 230 POLICE FORFEITURE FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2011 With Comparative Actual Amounts For The Year Ended December 31, 2010 Statement 21 1 2011 Budgeted Amounts 2010 t Original Final Actual Actual Revenues: Intergovernmental revenue $ - $ - $10,676 $5,807 Forfeiture and confiscation 21,000 21,000 10,782 21,989 Investment income 1,000 1,000 3 47 Total revenues 22,000 22,000 21,461 27,843 Expenditures: Public safety: Current: Personal services 5,000 5,000 - - Supplies 8,000 8,000 8,185 9,239 Other services and charges 5,000 5,000 2,057 3,816 Capital outlay - - - 41,406 Constructionlacquistion costs 8,000 8,000 29,255 Total expenditures 26,000 26,000 39,497 54,461 Revenues over(under)expenditures ($4,000) ($4,000) (18,036) (26,618) Fund balance - January 1 41,658 68,276 Fund balance - December 31 0 V t A 115 $23,622 $41,658 CITY OF ST. ANTHONY, MINNESOTA SPECIAL REVENUE FUND - 225 RECYCLING FUND Statement 22 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2011 With Comparative Actual Amounts For The Year Ended December 31, 2010 Revenues: Intergovernmental: Hennepin County recycling grant Ramsey County score grant Charges for services Investment income Total revenues Expenditures: General government: Current Personal services Other services and charges Total expenditures Revenues over(under)expenditures Fund balance (deficit) - January 1 Fund balance (deficit) - December 31 2011 Budgeted Amounts Original Final $6,500 5,000 4,000 15,500 4,300 17,000 21,300 $6,500 5,000 4,000 15,500 4,300 17,000 21,300 ($5,800) ($5,800) 116 Actual 4,893 2,487 7,380 2010 Actual 3,768 11 3,779 4,057 3,734 8,502 32,831 12,559 36,565 (5,179) (32,786) (6,638) 26,148 ($11,817) ($6,638) r CITY OF ST, ANTHONY, MINNESOTA I SPECIAL REVENUE FUND - 301 HRA FUND Statement 23 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2011 With Comparative Actual Amounts For The Year Ended December 31, 2010 Revenues: General property taxes Intergovernmental - State: Market value homestead credit Investment income Other Total revenues Expenditures: I Housing and redevelopment: Current: Personal services Contractual services Total expenditures Revenues over (under) expenditures Fund balance (deficit) - January 1, as previously reported Prior period adjustment Fund balance (deficit) - January 1, as restated Fund balance (deficit) - December 31 n 8 r a 105,200 2011 94,998 101,329 Budgeted Amounts 109,800 2010 Original Final Actual Actual 183,513 ($34,000) $112,500 $112,500 $106,877 $108,925 - - 3,540 3,487 67,500 67,500 6,203 20,184 1,000 1,000 41,622 11,681 181,000 181,000 158,242 144,277 105,200 105,200 94,998 101,329 109,800 109,800 132,923 82,184 215,000 215,000 227,921 183,513 ($34,000) ($34,000) (69,679) (39,236) 117 (97,972) (57,359) (1,377) (97,972) (58,736) ($167,651) (597,972) CITY OF ST. ANTHONY, MINNESOTA SPECIAL REVENUE FUND - 240 FIRE EDUCATION / TRAINING FUND Statement 24 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2011 With Comparative Actual Amounts For The Year Ended December 31, 2010 Revenues: Charges for services Investment income Other Total revenues Expenditures: Public safety: Current: Personal services Materials and supplies Other Total expenditures Revenues over expenditures Fund balance - January 1 Fund balance - December 31 2011 Budgeted Amounts Original Final 2010 Actual Actual $2,700 $2,700 $6,729 $2,065 2 100 100 447 3,835 2,800 2,800 7,176 5,902 2,300 2,300 3,630 4,376 400 400 2,396 597 100 2,700 2,700 6,026 5,073 $100 $100 118 1,150 829 2,272 1,443 $3,422 $2,272 n (-. CITY OF ST. ANTHONY, MINNESOTA STATEMENT OF CHANGES IN ASSETS AND LIABILITIES Statement 25 AGENCYFUND For The Year Ended December 31, 2011 I 119 Balance Balance January 1, December 31, 2011 Additions Deletions 2011 Veteran's Memorial Fund Assets: Cash and investments $200 $ - $13,572 ($13,372) Accounts receivable - net - 13,372 - 13,372 Total assets $200 $13,372 $13,572 $ - Liabilities: Deposits payable $200 $ - $200 $ - 119 - This page intentionally left blank - 120 SUPPLEMENTARY FINANCIAL INFORMATION 121 CITY OF ST. ANTHONY, MINNESOTA BALANCE SHEET HRA DEBT SERVICE FUND December 31, 2011 Exhibit 1 G.O. Tax Increment Bonds 325 1996A 311/312 Public 335 TIF 336 TIF HRA Debt Apache (Cub Facilities Revenue Bonds Revenue Bonds Service Fund Foods) Revenue Bonds 2006 2007 Totals 2011 Assets Cash and investments $13 $521,541 $ $ $521,554 Funds held in trust - 437,465 437,465 Accrued interest receivable - 6 - - 6 Property taxes receivable: Delinquent - 6,921 6,921 Due from county - 2,603 2,603 Total assets $13 $968,536 $0 $0 $968,549 Liabilities and Fund Balance Liabilities: Interfund loan payable 437,430 $437,430 Deferred revenue - 6,921 - - 6,921 Total liabilities 0 444,351 0 0 444,351 Fund balance: Restricted Total liabilities and fund balance 13 524,185 S13 $968,536 122 524,198 $0 SO $968,549 ( CITY OF ST. ANTHONY, MINNESOTA SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES Exhibit 2 IN FUND BALANCE HRA DEBT SERVICE FUND ( For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Revenues: General property taxes Investment income Total revenues Expenditures: General government: Other Debt service: Principal Interest and other Paying agent fees Professional service Total expenditures G.O. Tax Increment Transfers in Bonds - 355,675 318,396 873,321 311/312 Transfers out - - Public - - 325 1996A Facilities 335 TIF 336 TIF Apache (Cub Revenue Revenue Revenue Foods) Bonds Bonds 2006 Bonds 2007 HRA Debt Service Fund Totals 0 20,261 32,005 2011 2010 $ - $404,987 $ - $ - $404,987 $410,989 70 70 509 0 405,057 0 0 405,057 411,498 1,155 - - 175,000 225,000 95,000 22,168 155,685 256,675 914 2,414 2,000 1,155 1,378 95,000 590,000 560,000 217,746 652,274 674,789 650 5,978 4,859 - 1,710 2,000 5,000 8,710 - 199,237 384,809 355,675 318,396 1,258,117 1,241,026 Revenues over (under) expenditures (199,237) 20,248 (355,675) (318,396) (853,060) (829,528) Other financing sources (uses): Transfers in 199,250 - 355,675 318,396 873,321 861,533 Transfers out - - - - - Total other financing sources (uses) 199,250 0 355,675 318,396 873,321 861,533 Net change in fund balance 13 20,248 0 0 20,261 32,005 Fund balance - January 1, as previously reported - 503,937 - - 503,937 1,234,283 Prior period adjustment - - - - - (5,638) Accounting change - - - - (756,713) Fund balance (deficit) - January 1, as restated 0 503,937 0 0 503,937 471,932 Fund balance -December 31 $13 $524,185 $0 SO $524,198 $503,937 123 CITY OF ST. ANTHONY, MINNESOTA BALANCESHEET HRA PROJECTS FUND December 31, 2011 Assets Cash and investments Funds held in trust Interfund loan receivable Property taxes receivable: Delinquent Due from county Funds held by others Total assets Liabilities and Fund Balance Liabilities: Interfund payable Accounts payable Deposits payable Interfund loans payable Deferred revenue Total liabilities Fund balance (deficit): Restricted Committed Unassigned Total fund balance (deficit) Total liabilities and fund balance (deficit) Exhibit 3 Tax Increment Financing Districts 319/320 321 HRA Chandler 330 Apache 326 Apache Directed HRA Projects Place (Wal-Mart) (Cub Foods) Projects Eliminations Fund Total 2011 $176,921 $1,401,151 - 696 400,500 61,874 4,745 $290,017 $ - $ 630,000 91,018 (1,030,500) $1,868,089 696 61,874 4,745 91,018 $577,421 $1,468,466 $920,017 $91,018 ($1,030,500) $2,026,422 $ - $ - $ - $118,871 $ - $118,871 67,051 - - - 67,051 - - 2,483 - 2,483 2,030,500 - - (1,030,500) 1,000,000 61,874 - - - 61,874 0 2,159,425 0 121,354 (1,030,500) 1,250,279 577,421 696 920,017 - - 1,498,134 - - - 91,018 - 91,018 - (691,655) - (121,354) - (813,009) 577,421 (690,959) 920,017 (30,336) 0 776,143 $577,421 $1,468,466 $920,017 $91,018 ($1,030,500) $2,026,422 124 CITY OF ST. ANTHONY, MINNESOTA 1 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES Exhibit 4 IN FUND BALANCE HRA PROJECTS FUND j - For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 r Revenues: Tax increment collections Intergovernmental - MVHC t Investment income Other revenues: Developer fees and reimbursements Total revenues Expenditures: General government: Other Developer incentives Total expenditures Revenues over expenditures Other financing sources (uses) Tax Increment Financing Districts 15,000 229,455 1,228,147 264,204 336 1,722,142 1,939,112 4,209 39,667 1,039 - 444,013 - 319/320 213,761 470,632 321 0 488,928 326 Apache HRA - Chandler 330 Apache (Cub Directed 485,059 Place (Wal-Mart) Foods) Projects HRA Projects Fund Totals $554,377 2011 2010 $229,451 $1,215,240 $264,182 $ - $1,708,873 $1,911,678 - 12,781 - - 12,781 11,357 4 126 22 - 152 1,077 - - - 336 336 15,000 229,455 1,228,147 264,204 336 1,722,142 1,939,112 4,209 39,667 1,039 - 444,013 - - 44,915 - 444,013 213,761 470,632 4,209 483,680 1,039 0 488,928 684,393 225,246 744,467 263,165 336 1,233,214 1,254,719 Transfers out (68,809) (674,071) (199,250) - (942,130) (2,892,033) Net change in fund balance 156,437 70,396 63,915 336 291,084 (1,637,314) Fund balance - January 1, as previously reported 420,984 (761,355) 856,102 38,646 554,377 1,279,858 Prior period adjustment - - - (69,318) (69,318) 155,120 Accounting change - - - - - 756,713 Fund balance - January 1, as restated 420,984 (761,355) 856,102 (30,672) 485,059 2,191,691 Fund balance (deficit) - December 31 $577,421 ($690,959) $920,017 ($30,336$776,143 $554,377 L 125 i CITY OF ST. ANTHONY, MINNESOTA SCHEDULE OF REVENUES, EXPENSES AND CHANGES Exhibit 5 FUND NET ASSETS WATER AND SEWER ENTERPRISE FUND For The Year Ended December 31, 2011 With Comparative Totals For The Year Ended December 31, 2010 Operating revenues: Charges for services Connection charges Total operating revenues Operating expenses: Personal services Supplies Contracted services and other Treatment charges (MCES) Other Depreciation Total operating expenses Operating income (loss) Nonoperating revenues (expenses): Investment income Interest expense Amortization of bond discount Paying agent fees Miscellaneous income Total nonoperating revenues (expenses) Net operating income (loss) Transfers out Change in net assets Net assets - January 1 Prior period adjustment Net assets - January 1, as restated Net assets - December 31 126 52,441 199,615 Operations (71,093) (2,694) (2,694) 704 Water Filtration (361) Totals 3,236 701 Water and Purification 701 Sewer 2011 2010 $798,240 $ $779,513 $1,577,753 $1,574,664 - - 850 798,240 0 779,513 1,577,753 1,575,514 390,394 65,552 223,979 679,925 679,388 43,023 35,798 13,283 92,104 94,846 61,393 9,258 39,789 110,440 137,133 - - 522,503 522,503 502,255 142,391 22,373 54,045 218,809 182,174 166,923 - 89,151 256,074 256,074 804,124 132,981 942,750 1,879,855 1,851,870 ($5,884) ($132,981) ($163,237) (302,102) (276,356) Nonoperating revenues (expenses): Investment income Interest expense Amortization of bond discount Paying agent fees Miscellaneous income Total nonoperating revenues (expenses) Net operating income (loss) Transfers out Change in net assets Net assets - January 1 Prior period adjustment Net assets - January 1, as restated Net assets - December 31 126 52,441 199,615 (68,064) (71,093) (2,694) (2,694) (564) (361) 533 3,236 (18,348) 128,703 (320,450) (147,653) (178,000) (178,000) (498,450) (325,653) 8,712,010 9,037,663 28,252 - 8,740,262 9,037,663 $8,241,812 $8,712,010 III. STATISTICAL SECTION (UNAUDITED) This part of the City of St. Anthony, Minnesota's Comprehensive Annual Financial Report presents detailed information as a context for understanding what the information in the financial statements, note disclosures and required supplementary information says about the City of St. Anthony, Minnesota's overall financial health. Contents Financial Trends Page These tables contain trend information to help the reader understand how 128-133 the City's financial performance and well-being have changed over time. Revenue Capacity These tables contain information to help the reader assess the City's most 134-137 significant local revenue source, the property tax. Debt Capacity These tables present information to help the reader assess the affordability 138-145 of the City's current levels of outstanding debt and the City's ability to issue additional debt in the future. Demographic and Economic Information These tables offer demographic and economic indicators to help the reader 146-147 understand the enviornment within which the City's financial activities take place. Operating Information These tables contain service and infrastructure data to help the reader 148-153 understand how the information in the City's financial report relates to the services the City provides and the activities it performs. Sources: Unless otherwise noted, the information in these tables is derived from the comprehensive financial reports for the relevant year. Comparable GASB Statement 34 information is available for years beginning in 2005; the City has chosen to provide information for that year forward. Ultimately, these tables will contain information for the last ten years. 127 L. CITY OF ST. ANTHONY, MINNESOTA NET ASSETS BY COMPONENT Last Seven Fiscal Years (Accrual Basis of Accounting) Table 1 Business -type activities: Fiscal Year Invested in capital assets, Invested in capital assets, 2005 2006 2007 2008 2009 2010 2011 Governmental activities: $2,703,188 $4,745,674 $5,017,685 $4,915,905 $4,767,233 Restricted for: $19,014,138 $20,101,987 Invested in capital assets, Debt service 120,000 120,000 120,000 net of related debt $4,785,860 $9,108,004 $12,640,902 $13,372,903 $12,367,934 $14,098,233 $15,334,754 Restricted for: 615,994 5,642,649 Total business -type 53,908 63,701 60,985 34,320 16,281 Debt service 8,164,796 6,541,771 3,228,881 2,327,517 6,782,289 4,372,871 4,263,706 Public safety 50,191 42,994 53,908 63,701 60,985 34,320 16,281 Unrestricted 3,729,287 2,287,779 (383,292) 90,615 (3,478,013) (1,339,821) (6,358,682) Total governmental activities net assets $16,730,134 $17,980,548 $15,540,399 $15,854,736 $15,733,195 $17,165,603 $13,256,059 Business -type activities: Invested in capital assets, Invested in capital assets, net of related debt $1,758,506 $1,822,792 $2,703,188 $4,745,674 $5,017,685 $4,915,905 $4,767,233 Restricted for: $19,014,138 $20,101,987 Restricted for: Debt service 120,000 120,000 120,000 120,000 120,000 120,000 - Unrestricted 2,157,418 1,973,533 1,183,416 1,042,856 730,653 615,994 5,642,649 Total business -type 53,908 63,701 60,985 34,320 16,281 Unrestricted activities net assets $4,035,924 $3,916,325 $4,006,604 $5,908,530 $5,868,338 $5,651,899 $10,409,882 Primary government: Invested in capital assets, net of related debt $6,544,366 $10,930,796 $15,344,090 $18,118,577 $17,385,619 $19,014,138 $20,101,987 Restricted for: Debt service 8,284,796 6,661,771 3,348,881 2,447,517 6,902,289 4,492,871 4,263,706 Public safety 50,191 42,994 53,908 63,701 60,985 34,320 16,281 Unrestricted 5,886,705 4,261,312 800,124 1,133,471 (2,747,360) (723,827) (716,033) Total primary government net assets $20,766,058 $21,896,873 $19,547,003 $21,763,266 $21,601,533 $22,817,502 $23,665,941 Comparable GASB Statement 34 information is available for years beginning in 2005; the City has chosen to provide information for that year forward. Ultimately, this table will contain information for ten years. 128 CITY OF ST. ANTHONY, MINNESOTA CHANGES IN NET ASSETS Last Seven Fiscal Years (Accrual Basis of Accounting) Expenses Governmental activities: General government Public safety Public works Parks and recreation Services to other cities Housing and redevelopment Interest on long-term debt Total governmental activities expenses Business -type activities: Liquor Water Water Filtration and Purification Sewer Total business -type activities expenses Total primary government expenses Program revenues Governmental activities: Charges for services: Services to other cities Other activities Operating grants and contributions Capital grants and contributions Total governmental activities program revenues Business -type activities: Charges for services: Liquor Water Water Filtration and Purification Sewer Operating grants and contributions Capital grants and contributions Total business -type activities program revenues Total primary government program revenues L. Table 2 Page 1 of 2 Fiscal Year 2005 2006 2007 2008 2009 2010 2011 0l $877,230 $1,115,231 $1,111,240 $1,231,302 $1,160,932 $1,310,199 $1,052,821 2,402,296 2,461,222 2,359,360 2,656,975 2,937,528 2,898,043 2,971,316 1,414,857 1,400,951 6,266,350 1,436,309 1,839,163 1,841,083 1,834,066 1,499,773 806,512 450,549 416,881 424,590 440,858 457,822 606,952 649,625 911,419 940,807 1,026,842 1,016,479 1,039,009 424,273 2,967,835 173,098 536,068 2,534,700 654,145 671,934 1,014,270 1,096,390 1,411,926 1,497,107 1,407,527 1,290,844 1,302,681 8,239,651 10,497,766 12,683,942 8,715,449 11,331,282 9,451,651 9,329,649 5,034,639 5,429,222 5,740,169 5,969,076 6,156,097 6,360,985 6,537,271 641,490 899,686 775,828 794,433 843,723 826,352 874,099 - - - - - - 132,981 805,171 736,967 785,491 860,918 932,979 956,635 944,097 6,481,300 7,065,875 7,301,488 7,624,427 7,932,799 8,143,972 8,488,448 $14,720,951 $17.563,641 $19,985,430 $16,339,876 $19,264,081 $17,595,623 $17,818,097 $724,140 $747,675 $1,039,000 $1,096,200 $1,156,500 $1,157,190 $1,180,334 1,192,468 999,142 876,425 841,448 972,456 817,062 803,397 691,777 684,819 609,886 522,542 456,357 475,411 454,841 2,905,063 974,678 755,930 1,684,417 1,659,382 992,511 839,137 5,513,448 3,406,314 3,281,241 4,144,607 4,244,695 3,442,174 3,277,709 5,298,404 5,814,838 6,187,185 684,096 778,979 841,611 843,409 776,886 850,260 6,359,731 6,611,975 812,371 806,987 803,350 776,330 6,826,901 6,995,923 785,642 798,240 789,872 779,513 6,825,909 7,370,703 7,879,056 7,975,452 8,195,292 8,402,415 8,573,676 $12,339,357 $10.777,017 $11,160,297 $12,120,059 $12,439,987 511.844,589 $11,851,385 129 CITY OF ST. ANTHONY, MINNESOTA CHANGES IN NET ASSETS Last Seven Fiscal Years (Accrual Basis of Accounting) Table 2 Page 2 of 2 Fiscal Year 2005 2006 2007 2008 2009 2010 2011 Net (expense) revenue; Governmental activities ($2,726,203) ($7,091,452) ($9,402,701) ($4,570,842) ($7,086,587) ($6,009,477) ($6,051,940) Business -type activities 344,609 304,828 577,568 351,025 262,493 258,443 85,228 Total primary government net (expense) revenue (2,381,594) (6,786,624) (8,825,133) (4,219,817) (6,824,094) (5,751,034) (5,966,712) General revenues and other changes in net assets Governmental activities: Taxes: Property taxes Tax increment collections Grants and contributions Unrestricted investment earnings Other Gain on sale of capital assets Transfers Total governmental activities Business -type activities: Unrestricted investment earnings Other Transfers Total business -type activities Total primary government Change in net assets: Governmental activities Business -type activities Total primary government $3,464,453 $3,668,503 $3,968,436 $4,118,365 $4,442,708 $4,750,440 $4,872,840 410,968 851,309 1,477,929 1,753,559 1,952,704 1,807,388 1,746,766 124,309 94,470 159,741 88,291 20,918 22,827 24,673 358,571 514,440 698,345 403,426 208,761 224,693 6,803 214,859 96,837 77,745 36,365 16,103 61,866 148,500 - 8,730 - - 3,981 - - 348,250 485,000 580,356 (1,514,827) 319,871 478,000 595,200 4,921,410 5,719,289 6,962,552 4,885,179 6,965,046 7,345,214 7,394,782 44,410 78,638 74,764 18,985 6,833 (336) 52,659 499 12,490 18,303 17,089 10,353 3,454 3,976 (348,250) (485,000) (580,356) 1,514,827 (319,871) (478,000) (595,200) (303,341) (393,872) (487,289) 1,550,901 (302,685) (474,882) (538,565) $4,618,069 $5,325,417 $6,475,263 $6,436,080 $6,662,361 $6,870,332 $6,856,217 $2,195,207 ($1,372,163) ($2,440,149) $314,337 ($121,541) $1,335,737 $1,342,842 41,268 (89,044) 90,279 1,901,926 (40,192) (216,439) (453,337) $2,236,475 ($1,461,207) ($2,349,870) $2,216,263 ($161,733) $1,119,298 $889,505 Comparable GASB Statement 34 information is available for years beginning in 2005; the City has chosen to provide information for that year forward. Ultimately, this table will contain information for ten years. (') In 2011 the Water Filtration and Purification fund was reclassified to the Water and Sewer Proprietary Fund. 130 CITY OF ST. ANTHONY, MINNESOTA Reserved $5,537,424 $5,564,131 $4,116,654 $3,595,470 I FUND BALANCES - GOVERNMENTAL FUNDS $4,625,111 $ - Unreserved, reported in: Table 3 Last Seven Fiscal Years Special revenue funds 5,399,955 5,335,977 5,650,265 5,576,157 5,329,291 5,212,683 Capital projects funds r (Modified Accrual Basis of Accounting) 314,789 243,408 - Nonspendable - - - - - I 132 Restricted Fiscal Year - - 6,868,120 2005 2006 2007 2008 2009 2010 2011 General Fund: - 763,667 Unassigned - - - - - - Reserved $39,805 $44,852 $46,543 $51,205 $53,849 $57,430 $ - Unreserved 1,147,914 1,237,373 1,391,816 1,389,299 1,471,584 1,567,270 - Nonspendable - - - - - - 55,271 Unassigned - - - - - - 1,647,566 I Total general fund $1,187,719 $1,282,225 $1,438,359 $1,440,504 $1,525,433 $1,624,700 $1,702,837 All other governmental funds: Reserved $5,537,424 $5,564,131 $4,116,654 $3,595,470 $6,264,349 $4,625,111 $ - Unreserved, reported in: Special revenue funds 5,399,955 5,335,977 5,650,265 5,576,157 5,329,291 5,212,683 Capital projects funds 894,116 1,500,372 695,197 967,355 314,789 243,408 - Nonspendable - - - - - - 132 Restricted - - - - - - 6,868,120 Committed - - - - - - 210,953 Assigned - - - - - - 763,667 Unassigned - - - - - - (1,240,578) Total all other governmental funds $11,831,495 $12,400,480 $10,462,116 $10,138,982 $11,908,429 $10,081,202 $6,602,294 Comparable GASB Statement 34 information is available for years beginning in 2005; the City has chosen to provide information for that year forward. Ultimately, this table will contain information for ten years. Note: The City implemented GASB Statement No. 54 for the fiscal year ended December 31, 2011, resulting in significant reclassification of the components of fund balances. 131 CITY OF ST. ANTHONY, MINNESOTA CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS Last Seven Fiscal Years (Modified Accrual Basis of Accounting) Table 4 Page 1 of 2 132 Fiscal Year 2005 2006 2007 2008 2009 2010 201111 Revenues: General property taxes $3,430,286 $3,649,764 $3,957,749 $4,097,493 $4,407,221 $4,787,076 $4,877,268 Tax increment collections 410,968 851,309 1,469,532 1,682,549 1,903,840 1,911,678 1,708,873 Licenses, fees and permits 548,972 244,170 213,842 247,878 358,381 224,096 195,563 Intergovernmental 1,201,555 954,911 706,080 2,039,592 1,430,366 1,239,053 861,744 Special assessments 1,548,836 589,812 441,327 385,197 506,262 398,895 517,678 Charges for services 1,057,781 1,113,298 1,403,419 1,451,925 1,519,427 1,528,210 1,573,975 Cable franchise fees 69,577 70,737 85,162 92,606 92,309 92,786 96,608 Fines and forfeits 101,273 135,960 164,788 139,421 122,870 128,165. 117,835 Investment income 354,749 507,615 689,428 400,038 184,053 224,598 6,792 Contributions and donations - 6,300 37,100 3,950 3,450 2,834 610 Miscellaneous 540,229 511,851 404,611 186,449 53,354 708,181 148,500 Total revenues 9,264,226 8,635,727 9,573,038 10,727,098 10,581,533 11,245,572 10,105,446 Expenditures: Current: General government 776,110 952,291 945,295 1,076,699 1,017,405 1,170,630 883,478 Public safety 2,119,568 2,255,783 2,165,891 2,446,434 2,654,708 2,615,752 2,700,328 Public works 772,565 759,254 809,751 679,269 761,530 726,064 684,761 Parks and recreation 1,467,289 783,791 428,341 394,673 401,787 388,808 366,153 Services to other cities 606,952 649,625 911,419 940,807 1,026,842 1,016,479 1,039,009 Nondepartmental 5,228 1,501 48,735 23,387 6,798 6,940 22,283 Housing and redevelopment 424,273 439,422 173,098 212,583 191,608 183,513 227,921 Capital outlay: General government 572 6,389 125 - - - 12,661 Public safety 139,648 229,174 12,993 - - 67,850 152,405 Public works 31,040 21,056 316,264 318,668 271,459 212,029 112,158 Parks and recreation - 19,712 - - - - - Debt service: Principal retirement 1,495,000 4,765,000 2,195,000 2,305,000 1,970,000 4,255,000 3,120,000 Interest 997,352 1,022,069 1,313,578 1,450,248 1,369,280 1,392,608 1,271,549 Paying agent fees 14,386 9,373 11,501 10,601 9,519 8,763 11,582 Professional service 16,097 9,140 1,901 5,080 5,077 3,117 30,109 Issuance costs - - 208,545 - 49,420 - 67,278 Construction/acquisition costs 2,901,864 2,108,395 5,366,376 3,419,607 4,789,180 2,420,767 1,953,923 Developer incentives - 2,769,938 3,592,385 323,485 443,092 470,632 444,013 District decertified - repayment of tax increments - 36,580 - - - - Total expenditures 11,767,944 16,838,493 18,501,198 13,606,541 14,967,705 14,938,952 13,099,611 Revenues over (under) expenditures (2,503,718) (8,202,766) (8,928,160) (2,879,443) (4,386,172) (3,693,380) (2,994,165) 132 CITY OF ST- ANTHONY, MINNESOTA CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS Last Seven Fiscal Years (Modified Accrual Basis of Accounting) I Table 4 Page 2 of 2 Fiscal Year 2005 2006 2007 2008 2009 2010 2011 i Other financing sources (uses): ' Bonds issued $1,695,000 $8,165,000 $6,690,000 $1,910,000 $3,965,000 $1,375,000 $1,940,000 Refunding bonds issued - - - - 2,855,000 - 3,225,000 Redemption of refunded bonds - - - - (1,210,000) - (1,030,000) Premium on debt issued - 30,669 - 8,749 140,492 402 105,598 Discount on debt issued - (3,069) (213) - - - - Sale of capital assets 12,852 18,855 8,744 14,705 12,056 15,347 9,982 1 Transfers in 467,022 1,775,848 4,275,129 1,832,828 1,307,574 3,634,584 595,200 Transfers out (118,772) (1,290,848) (3,827,825) (1,207,828) (829,574) (3,156,584) - Total other financing 1 sources(uses) 2,056,102 8,696,455 7,145,835 2,558,454 6,240,548 1,868,749 4,845,780 Net change in fund balance g ($447,616) $493,689 ($1,782,325) ($320,989) $1,854,376 ($1,824,631) $1,851,615 ' Debt service as a percentage of jnoncapital expenditures 28.7% 40.0% 27.4% 38.1% 33.7% 46.1% 40.4% Debt service as percentage of total expenditures 21.2% 34.4% 19.0% 27.6% 22.3% 37.8% 33.5% Comparable GASB Statement 34 information is available for years beginning in 2005; the City has chosen to provide information for that year forward. Ultimately, this table will contain information for ten years. 10In 2011 the Water Filtration and Purification fund was reclassified to the Water and Sewer Proprietary Fund. L 1 133 L CITY OF ST. ANTHONY, MINNESOTA TAX CAPACITY VALUE AND ESTIMATED MARKET VALUE OF TAXABLE PROPERTY Table 5 Last Ten Fiscal Years Source: Official Statements for the City of St. Anthony. (Hennepin and Ramsey Counties Combined) * A complete breakdown of tax capacity was not available, these numbers have been estimated by considering total tax capacity and the related percentage breakdown from the previous year. ** The Minnesota Legislature reduced some of the "class rates" used to calculate tax capacity values in levy years 1998,1999 and 2001. The lower rates reduce the amount of Taxable Market Value that converts to value for the calculation of property taxes and tax rates. 134 Commercial/ Total Fiscal Adjusted Total Estimated Tax Capacity Payable Residential Industrial All Tax Disparity Tax Capacity Direct Tax Market as a Percent Year Property Property Other Capacity Contribution Value Rate Value ofEMV 2002 3,979,387 * 1,467,645 * 86,976 * 5,534,008 (319,514) 5,214,494 50.33% 460,129,700 1.13% ** 2003 4,703,934 1,307,337 66,005 6,077,276 (318,956) 5,758,320 47.05% 520,877,700 1.11% 2004 5,061,743 1,387,360 67,875 6,516,978 220,246 6,737,224 52.01% 576,666,300 1.17% 2005 5,758,863 1,509,783 70,799 7,339,445 (30,542) 7,308,903 50.31% 636,972,900 1.15% 2006 6,449,616 2,001,921 65,285 8,516,822 (391,888) 8,124,934 46.58% 730,541,000 1.11% 2007 7,894,132 2,575,759 * 64,903 10,534,794 (1,374,734) 9,190,060 45.62% 893,542,800 1.03% 2008 7,537,190 2,684,972 67,599 10,289,761 (1,260,607) 9,029,154 51.61% 869,823,300 1.18% 2009 7,194,714 2,546,141 64,834 9,805,689 (1,106,369) 8,699,320 55.66% 828,631,600 1.18% 2010 6,734,706 2,398,897 71,265 9,204,868 (909,287) 8,295,581 59.89% 778,761,500 1.18% 2011 6,039,859 2,255,091 98,790 8,393,740 (815,258) 7,578,482 68.85% 739,475,900 1.14% Source: Official Statements for the City of St. Anthony. (Hennepin and Ramsey Counties Combined) * A complete breakdown of tax capacity was not available, these numbers have been estimated by considering total tax capacity and the related percentage breakdown from the previous year. ** The Minnesota Legislature reduced some of the "class rates" used to calculate tax capacity values in levy years 1998,1999 and 2001. The lower rates reduce the amount of Taxable Market Value that converts to value for the calculation of property taxes and tax rates. 134 M CITY OF ST. ANTHONY, MINNESOTA DIRECT AND OVERLAPPING PROPERTY TAX RATES Table 6 Last Ten Fiscal Years City Overlapping Rates* Fiscal Direct School Other Hennepin Year Rate District Districts County Total 2002 50.33% 18.37% ** 14.09% 50.41% 133.20% 2003 47.05% 14.93% 15.63% 50.61% 128.21% 2004 52.01% 22.10% 13.45% 47.32% 134.88% 2005 50.31% 19.33% 13.93% 44.17% 127.74% 2006 46.58% 21.78% 14.65% 41.02% 124.03% 2007 45.62% 19.73% 13.81% 38.57% 117.73% 2008 51.61% 32.04% 13.35% 40.41% 137.41% 2009 55.66% 32.72% 17.37% 42.06% 147.81% 2010 59.89% 36.48% 11.14% 45.84% 153.34% 2011 68.85% 38.32% 12.04% 48.23% 167.44% Source: Official Statements for the City of St. Anthony (Hennepin County) *Overlapping rates are those of local and county governments that apply to property owners within the City. Not all overlapping rates apply to all City property owners; for example, although the county property tax rates apply to all City property owners, other District rates apply only to the approximately one-third of City property owners whose property is located within that District's geographic boundaries. **The State of Minnesota enacted significant property tax reform measures in 2001. Among these measures were several provisions which substantially reduced school district property tax levies, replacing the tax levy funds with state aid. As a result, tax levies and tax rates for most school districts for taxes payable in 2002 are substantially less than the comparable figures for prior years. 135 CITY OF ST. ANTHONY, MINNESOTA PRINCIPAL PROPERTY TAXPAYERS Table 7 Current Year and Nine Years Ago Source: Official Statements for the City of St. Anthony 136 2011 2002 Percentage Percentage Tax of Total City Tax of Total City Capacity Capacity Capacity Capacity Taxpayer Value Rank Value Value Rank Value St. Anthony Retail Development $747,742 1 8.12% $ - 0.00% St. Anthony Leased Housing Assoc. 300,150 2 3.26% - 0.00% Autumn Woods Partnership LP 188,225 3 2.04% - 0.00% Equinox Properties LLC 176,890 4 1.92% 162,792 2 2.94% St. Anthony Shopping Center 95,250 5 1.03% 42,850 10 0.77% Xcel Energy 86,352 6 0.00% 69,544 6 1.26% LG Anderson LLC/Apache Medical 84,750 7 0.92% 47,194 8 0.85% St. Anthony Nursing Home LP 78,364 8 0.85% 209,186 2 3.78% Chandler Place LP 78,213 9 0.85% 107,100 4 1.94% Landau -3925 Pleasant 75,086 9 0.82% - 0.00% Landau Pleasant LLC 75,086 10 0.82% - 0.00% Glaser Financial Group Inc. - 0.00% 304,344 1 5.50% Village North - 0.00% - 0.00% St. Anthony Business Center - 0.00% 42,850 9 0.77% SuperValu - 0.00% 125,334 3 2.26% Welsh Companies - 0.00% 58,150 7 1.05% Individual - 0.00% - 0.00% Total $1,986,108 20.63% $1,169,344 21.12% Total All Property $9,204,868 $5,534,008 Source: Official Statements for the City of St. Anthony 136 CITY OF ST. ANTHONY, MINNESOTA PROPERTY TAX LEVIES AND COLLECTIONS Last Ten Fiscal Years Table 8 Fiscal Taxes Collected Within The Collections Year Levied Fiscal Year of the Levy in Total Collections to Date Ended For The Percentage Subsequent Percentage December 31, Fiscal Year Amount of Levy (1) Years Amount of Levy 2002 $2,634,866 $2,625,911 99.66% $7,923 $2,633,834 99.96% 2003 2,731,541 2,721,724 99.64% 8,129 2,729,853 99.94% 2004 3,370,364 3,349,081 99.37% 12,095 3,361,176 99.73% 2005 3,689,759 3,655,463 99.07% 31,990 3,687,453 99.94% 2006 3,812,957 3,776,369 99.04% 35,404 3,811,773 99.97% 2007 4,123,032 4,079,891 98.95% 30,447 4,110,338 99.69% 2008 4,169,941 czl 4,088,462 98.05% 47,261 4,135,723 99.18% 2009 4,465,113 tz) 4,352,222 97.47% 44,509 4,396,731 98.47% 2010 4,642,067 (2) 4,566,162 98.36% 40,209 4,606,371 99.23% 2011 4,761,665 cxl 4,710,258 98.92% - 4,710,258 98.92% (i) Beginning with payable year 2002 through 2007, Market Value Homestead Credit is included in the operating levy. (z) Net of Market Value Homestad Credit which was subject to State unallotments or other reductions. Sources: 2001 - 2004 Official Statements for the City of St. Anthony 2005 - 2010 St. Anthony Finance Department 137 CITY OF ST. ANTHONY, MINNESOTA RATIOS OF OUTSTANDING DEBT BY TYPE Last Seven Fiscal Years Governmental Activities Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements Source: St. Anthony Finance Department *Per Capita data is based on a 2010 population of 8,226. Information is not available for years prior to 2005. 138 General Tax Total Percentage Fiscal Obligation Improvement Increment Revenue Fannie Governmental of Adjusted Year Bonds Bonds Bonds Bonds Mae Loan Activities Tax Capacity 2005 $1,435,000 $11,210,000 $2,355,000 $6,600,000 $3,350,000 $24,950,000 341.36% 2006 1,245,000 11,300,000 6,145,000 6,310,000 3,350,000 $28,350,000 348.93% 2007 1,055,000 12,675,000 10,605,000 6,010,000 2,500,000 $32,845,000 358.57% 2008 945,000 13,015,000 10,375,000 5,615,000 2,500,000 $32,450,000 359.39% 2009 825,000 16,220,000 10,055,000 6,940,000 2,050,000 $36,090,000 414.86% 2010 695,000 15,260,000 9,710,000 6,295,000 1,250,000 $33,210,000 400.33% 2011 565,000 18,355,000 9,345,000 5,960,000 - $34,225,000 451.61% Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements Source: St. Anthony Finance Department *Per Capita data is based on a 2010 population of 8,226. Information is not available for years prior to 2005. 138 Business -Type Activities Sewer/ Liquor Total Water Revenue Business -Type U, 12.:,000 2,050,000 1,975,000 1,895,000 1,815,000 1,730,000 1,640,000 �4Y),000 425,000 350,000 270,000 185,000 95,000 T2,6ZU,000 2,475,000 2,325,000 2,165,000 2,000,000 1,825,000 1,640,000 Sewer/ Water Bonds Total Per Primary 139 �19SZ $2/,5/U,000 896 30,825,000 1,070 35,170,000 824 34,615,000 789 38,090,000 752 35,035,000 713 35,865,000 Table 9 Percentage of Personal Per Income n) Capita* N/A $3,357 N/A 3,924 N/A 3,847 N/A 3,818 N/A 4,278 N/A 4,037 N/A 4,161 CITY OF ST. ANTHONY, MINNESOTA DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT As of December 31, 2011 Governmental Unit Debt repaid with property taxes: (1) School Districts: ISD No. 282 NE Metro Intermediate School District No. 916 Counties: Hennepin Ramsey Other: Metropolitan Council Three Rivers Park District Subtotal - overlapping debt City direct debt (Z) Table 10 Estimated Estimated Share of Debt Percentage Overlapping Outstanding Applicable* Debt $23,515,000 84.4291% $19,853,508 732,745,000 0.4031% 2,953,715 170,590,000 0.4561% 778,014 168,665,000 0.2372% 400,073 62,755,000 0.5502% 345,291 24,330,601 25,260,000 Total direct and overlapping debt $49,590,601 Sources: (') Official Statements for City of St. Anthony (a) St. Anthony Finance Department Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the City. This process recognizes that, when considering the City's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government. *For debt repaid with property taxes, the percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable percentages were estimated by determining the portion of another governmental unit's taxable assessed value that is within the City's boundaries and dividing it by each unit's total taxable assessed value. 140 CITY OF ST. ANTHONY, MINNESOTA LEGAL DEBT MARGIN INFORMATION Table 11 Last Seven Fiscal Years i Legal Debt Margin Calculation for Fiscal Year 2011 Market value $739,475,900 Debt limit (3% of market value) 22,184,277 Debt applicable to limit: General obligation bonds 5,820,000 Less: Amount set aside for repayment of general obligation debt (1,111,699) Total net debt applicable to limit 4,708,301 Legal debt margin $17,475,976 2005* 2006* 2007* 2008 2009 2010 2011 Debt limit $13,406,318 $14,610,820 $17,870,856 $26,094,699 $24,778,098 $23,262,423 $22,184,277 Total net debt applicable to limit 4,776,007 4,429,013 4,099,637 5,741,849 5,410,204 5,059,006 4,708,301 Legal debt margin $8,630,311 $10,181,807 $13,771,219 $20,352,850 $19,367,894 $18,203,417 $17,475,976 Total net debt applicable to the limit as a percentage of debt limit 35.63% 30.31% 30.31% 22.00% 21.83% 21.75% 21.22% Source: Market Value - Hennepin County and Ramsey County, Minnesota Assessor's Offices Information is not available for years prior to 2005. *Debt limit was 2% of market value. L 141 CITY OF ST. ANTHONY, MINNESOTA PLEDGED REVENUE COVERAGE Last Seven Fiscal Years Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements. Operating expenses do not include interest, depreciation, or amortization expenses. Information is not available for years prior to 2005. 142 Storm Sewer Revenue Bonds Utility Less Net Fiscal Service Operating Available Debt Service Year Charges Expenses Revenue Principal Interest Coverage 2005 $163,951 $ - $163,951 $95,000 $68,448 100% 2006 169,255 - 169,255 100,000 63,670 103% 2007 167,373 - 167,373 105,000 58,595 102% 2008 167,373 - 167,373 110,000 53,220 103% 2009 167,793 - 167,793 120,000 40,103 105% 2010 150,431 - 150,431 130,000 28,575 95% 2011 150,833 - 150,833 130,000 18,900 101% Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements. Operating expenses do not include interest, depreciation, or amortization expenses. Information is not available for years prior to 2005. 142 Table 12 Page 1 of 2 143 Water and Sewer Revenue Bonds Utility Less Net Service Operating Available Debt Service Charges Expenses Revenue Principal Interest Coverage $1,527,505 $1,210,943 $316,562 $75,000 $82,195 201% 1,556,004 1,387,657 168,347 75,000 80,694 108% 1,691,871 1,480,228 211,643 75,000 78,750 138% 1,615,721 1,576,269 39,452 80,000 77,236 25% 1,583,317 1,699,919 (116,602) 80,000 75,056 (75%) 1,575,514 1,708,839 (133,325) 85,000 71,093 (850/.) 1,588,190 1,753,661 (165,471) 90,000 68,064 (105%) 143 CITY OF ST. ANTHONY, MINNESOTA PLEDGED REVENUE COVERAGE Last Seven Fiscal Years Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements. Operating expenses do not include interest, or amortization expenses. Information is not available for years prior to 2005. 144 Liquor Revenue Bonds Less Net Fiscal Net Sales Operating Available Debt Service Year (Gross Profit) Expenses Revenue Principal Interest Coverage 2005 $1,169,359 $766,082 $403,277 $65,000 $32,150 415% 2006 1,362,796 839,959 522,837 70,000 29,619 525% 2007 1,475,679 985,377 490,302 75,000 24,438 493% 2008 1,475,173 1,049,110 426,063 80,000 20,125 426% 2009 1,543,854 1,058,977 484,877 85,000 15,525 482% 2010 1,594,829 1,106,675 488,154 90,000 10,638 485% 2011 1,654,205 1,163,167 491,039 95,000 5,463 489% Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements. Operating expenses do not include interest, or amortization expenses. Information is not available for years prior to 2005. 144 Table 12 Page 2 of 2 t 145 Improvement Bonds Tax Increment Bonds Special Tax iAssessment Debt Service Increment Debt Service Collections Principal Interest Coverage Collections Principal Interest Coverage $1,548,836 I $485,000 $323,582 192% $410,968 $105,000 $145,381 164% 589,812 3,100,000 390,118 17% 851,309 1,185,000 95,263 66% i 441,327 675,000 480,360 38% 1,469,532 180,000 384,296 260% 385,197 1,570,000 495,649 19% 1,682,549 230,000 538,369 219% 506,262 760,000 430,947 43% 1,903,840 320,000 526,949 225% 398,895 2,235,000 499,506 15% 1,911,678 345,000 512,504 223% - 2,070,000 532,400 0% - 365,000 496,588 0% t 145 CITY OF ST. ANTHONY, MINNESOTA DEMOGRAPHIC AND ECONOMIC STATISTICS Last Ten Fiscal Years Table 13 Sources: 2�1 Information is not tracked on a yearly basis for individual cities. Data for Hennepin County was used. Source - Hennepin County (2) Information not available is labeled N/A. (3) Official Statements for the City of St. Anthony (4) Metropolitan Council Estimate (5) 2010 US Census Results 146 Per Capita Fiscal Personal Personal Unemployment Year Population (3) Income (2) (3) IncomeM Rate(n 2002 8,012 $352,090,233 $43,907 4.60% 2003 8,012 363,296,128 45,344 4.80% 2004 8,012 385,272,855 48,045 4.50% 2005 8,012 N/A N/A 3.40% 2006 8,012 N/A N/A 3.60% 2007 8,361 N/A N/A 4.20% 2008 8,361 N/A N/A 5.00% 2009 8,437 N/A N/A 6.80% 2010 8,514 (4) N/A N/A 6.50% 2011 8,226 (s) N/A N/A 5.30% Sources: 2�1 Information is not tracked on a yearly basis for individual cities. Data for Hennepin County was used. Source - Hennepin County (2) Information not available is labeled N/A. (3) Official Statements for the City of St. Anthony (4) Metropolitan Council Estimate (5) 2010 US Census Results 146 I L CITY OF ST. ANTHONY, MINNESOTA PRINCIPAL EMPLOYERS Table 14 Current Year and Nine Years Ago Total 1,433 1,020 * Data is not available for more than the top ten employers in 2011. Source: Official Statements for the City of St. Anthony 147 2011* 2002 Employer Employees Rank Employees Rank ISD No. 282 (St. Anthony - New Brighton) 300 1 248 1 Cub Foods 250 2 191 3 Wal-Mart 250 3 - - St. Anthony Health Center and Chandler Place 200 4 215 2 City of St. Anthony 132 5 132 4 B&F Fastener Supply 100 6 - - St. Charles Borromeo Parish 57 7 49 8 Happy's Potato Chip Company 56 8 50 7 Applebee's 45 9 - - Culver's 43 10 - - Chandler Place - - 75 5 Herbergers - - 60 6 Total 1,433 1,020 * Data is not available for more than the top ten employers in 2011. Source: Official Statements for the City of St. Anthony 147 CITY OF ST. ANTHONY, MINNESOTA FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION / PROGRAM Last Ten Fiscal Years Function/Program General government: Administration Finance Police: Officers Support staff Community service officer Volunteers (non -paid) Fire: Firefighters Volunteers (paid on call) Public works: Administration Street Park Water/Sewer Mechanic Seasonal* Liquor operations: Off -sale: Full-time Market Place - part-time Silver Lake Village - part-time On -sale: Full-time Stonehouse - part-time Total Full -Time Equivalent Employees as of December 31, 2011 2002 2003 2004 3.00 3.00 3.00 4.50 4.50 4.50 20.00 20.00 20.00 2.00 2.00 2.00 1.00 0.50 0.50 12.00 12.00 12.00 7.00 7.00 7.00 3.00 3.00 3.00 2.00 2.00 2.00 5.00 5.00 5.00 2.00 2.00 3.00 2.00 2.00 2.00 1.00 1.00 1.00 2.25 2.25 2.25 4.00 5.00 5.00 5.25 5.25 5.25 5.25 5.25 5.25 4 9 94.00 81.75 82.75 * Historical number adjusted to reflect Full -Time Equivalent versus actual head count Source: City of St. Anthony 148 Table 15 Full -Time Eauivalen[ Emolovees as of December 31.2011 3.00 3.00 3.00 3.00 3.00 3.00 3.00 4.50 4.50 4.50 4.75 4.75 4.75 4.50 20.00 20.00 22.00 23.00 23.00 23.00 23.00 2.00 2.00 2.00 2.50 2.50 2.50 2.50 0.50 0.50 1.00 1.00 1.00 1.00 1.00 12.00 12.00 12.00 12.00 12.00 12.00 12.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 6.00 6.00 6.00 6.00 6.00 6.00 5.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 2.25 2.25 2.25 2.00 2.00 2.00 2.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 5.25 5.25 5.25 5.25 5.25 6.00 6.00 5.25 5.25 5.25 5.25 5.25 6.00 6.00 82.75 86.75 87.00 82.75 85.25 86.75 88.25 149 CITY OF ST. ANTHONY, MINNESOTA OPERATING INDICATORS BY FUNCTION / PROGRAM Last Ten Fiscal Years Function/Program Police: * Moving violation Non-moving violations DWI Traffic arrests Gross and misdemeanor arrests Felony arrests Warrant arrests Fire: Emergency responses Medical responses Fires Inspections ** Building inspection: Permits issued Other public works: Street resurfacing (miles) Potholes filled (tons) Water: New connections Water mains breaks Average daily consumption (thousands of gallons) Peak daily consumption (thousands of gallons) * Police statistics are for St Anthony only ** Began monitoring inspection in 2006 Source: City of St. Anthony 150 Fiscal Year 1,833 1,772 2,072 527 601 544 25 37 60 461 400 587 160 179 150 37 52 32 32 31 31 885 901 925 576 568 586 46 47 46 ** ** ** 313 277 341 1 1 1 10 8 8 7 876 1,495 10 961 1,278 8 898 1,601 L. L. L Table 16 15] Fiscal Year 2005 2006 2007 2008 2009 2010 2011 1,560 2,246 2,357 2,137 2,008 2,305 1,848 501 632 627 494 351 397 210 56 114 26 61 59 49 44 515 750 831 815 770 600 673 181 162 158 203 193 129 145 54 67 45 44 32 29 46 23 22 29 32 32 28 28 1,043 980 976 1,055 996 956 976 646 704 696 768 718 895 894 47 28 40 89 68 34 35 ** 197 78 81 92 97 121 346 292 255 262 283 315 336 1 1 2 2 1 1 2 7 5 35 20 80 22 100 - 14 16 10 - - - 10 3 32 8 9 11 10 903 922 990 902 885 806 821 2,192 2,454 2,500 2,157 2,295 1,396 1,586 15] - This page intentionally left blank - 154 r I r L L L L