2016.07.05 CC Packet - Laserfiche WebLink

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CITY OF HUGO, MINNESOTA MANAGEMENT'S DISCUSSION AND ANALYSIS Financial Analysis of the Government's Funds As noted earlier, the City of Hugo uses fund accounting to ensure and demonstrate compliance with finance -related legal requirements. Governmental funds. The focus of the City of Hugo'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 Hugo's financing requirements. In particular, committed, assigned and unassigned fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year. As of the end of the current fiscal year, the City of Hugo's governmental funds reported combined ending fund balances of $15,836,138, a decrease of $4,426,473 from the prior year primarily as a result of the refunding of the 2004 and 2005 general obligation bonds. The entire ending fund balance of the governmental funds constitutes spendable fund balance, which is further classified as restricted, committed, assigned or unassigned. The general fund is the chief operating fund of the City of Hugo. At the end of the current fiscal year, unassigned fund balance of the general fund was $2,422,714. As a measure of the general fund's liquidity, it may be useful to compare the unassigned fund balance to total fund expenditures. Unassigned fund balance represents 57 percent of total general fund expenditures. The general fund's total fund balance increased by $106,265 during the current fiscal year. This year's increase was primarily due to licenses and permit revenues in excess of expectations related to increased building activity. Revenues in the general fund met or exceeded budget projections in all cases. General fund expenditures met or were less than budgeted projections in all departments except community development and as a fund overall. The general obligations bonds fund decreased its fund balance by $5,730,367 for the year due primarily to debt service payments, including the refunding of the 2004 and 2005 general obligation bonds, in excess of property taxes and intergovernmental revenues allocated to this fund. The public improvements fund increased its fund balance by $636,124 for the year due primarily to intergovernmental revenues and collection of property taxes and special assessments in excess of capital outlay expenditures. The property and equipment acquisition fund increased its fund balance by $305,435 for the year due primarily to transfers from other funds. The special revenue funds increased their fund balances by $317,771 for the year due primarily to collection of property taxes and developer fees in excess of capital outlay expenditures. The debt service funds (other than the general obligations fund as described as a major fund above) have a total fund balance of $932,397 as of December 31, 2015. These fund balances decreased by $61,701 for the year due primarily to transfers to other funds for bond principal and interest payments. 11