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CITY OF HUGO, MINNESOTA
<br />MANAGEMENT'S DISCUSSION AND ANALYSIS
<br />Proprietary funds. The City of Hugo maintains one type of proprietary fund — enterprise funds.
<br />Enterprise funds are used to report the same functions presented as business -type activities in the
<br />government -wide financial statements. The City of Hugo uses enterprise funds to account for its sewer
<br />and water operations. Proprietary funds provide the same type of information as the government -wide
<br />financial statements, only in more detail. The proprietary fund financial statements provide information
<br />for the sewer and water fund, which is considered to be a major fund of the City of Hugo. The basic
<br />proprietary fund financial statements can be found on pages 27-29 and 79 of this report.
<br />Notes to the financial statements. The notes provide additional information that is essential to a full
<br />understanding of the data provided in the government -wide and fund financial statements. The notes to
<br />the financial statements can be found on pages 30-67 of this report.
<br />Other information. The combining and individual fund statements referred to earlier in connection with
<br />nonmajor governmental funds can be found on pages 70-78 of this report.
<br />GOVERNMENT -WIDE FINANCIAL ANALYSIS
<br />As noted earlier, net position may serve over time as a useful indicator of a government's financial
<br />position. In the case of the City of Hugo, assets exceeded liabilities by $78,298,032 at the close of the
<br />most recent fiscal year. A significant portion of the City of Hugo's net position (56 percent) reflects its
<br />investment in capital assets (e.g. land, buildings, vehicles, and equipment), less any related debt used
<br />to acquire those assets that is still outstanding. The balance of the City's net investment in capital
<br />assets increased 2 percent from the prior year due primarily to the addition of capital assets. The City of
<br />Hugo uses its capital assets to provide services to citizens; consequently, these assets are not
<br />available for future spending. Although the City of Hugo's investment in its capital assets is reported net
<br />of related debt, it should be noted that the resources needed to repay this debt must be provided from
<br />other sources, since the capital assets themselves cannot be used to liquidate these liabilities.
<br />Current and other assets
<br />Capital assets
<br />Total assets
<br />Deferred outflows of
<br />resources
<br />Long-term liabilities
<br />outstanding
<br />Other liabilities
<br />Total liabilities
<br />Deferred inflows of
<br />resources
<br />Net assets:
<br />Net investment in
<br />capital assets
<br />Restricted
<br />Unrestricted
<br />Total net position
<br />City of Hugo, Minnesota's Net Position
<br />Governmental Activities
<br />2016 2015
<br />Business -Type Activities
<br />2016 2015
<br />Total
<br />2016 2015
<br />$ 21,945,362
<br />$ 21,616,812
<br />$ 20,206,928
<br />$ 19,257,201
<br />$ 42,152,290
<br />$ 40,874,013
<br />30,208,303
<br />29,201,788
<br />16,735,066
<br />16,679,906
<br />46,943,369
<br />45,881,694
<br />52,153,665
<br />50,818,600
<br />36,941,994
<br />35,937,107
<br />89,095,659
<br />86,755,707
<br />737,470
<br />145,730
<br />145,294
<br />31,474
<br />882,764
<br />177,204
<br />9,213,400
<br />10,148,889
<br />381,105
<br />249,735
<br />9,594,505
<br />10,398,624
<br />1,764,932
<br />1,662,474
<br />92,050
<br />72,581
<br />1,856,982
<br />1,735,055
<br />10,978,332
<br />11,811,363
<br />473,155
<br />322,316
<br />11,451,487
<br />12,133,679
<br />188,468
<br />157,245
<br />40,436
<br />32,019
<br />228,904
<br />189,264
<br />26,906,049
<br />26,217,435
<br />16,735,066
<br />16,679,906
<br />43,641,115
<br />42,897,341
<br />5,780,135
<br />6,569,231
<br />5,780,135
<br />6,569,231
<br />9,038,151
<br />6,209,056
<br />19,838,631
<br />18,934,340
<br />28,876,782
<br />25,143,396
<br />$ 41,724,335
<br />$ 38,995,722
<br />$ 36,573,697
<br />$ 35,614,246
<br />$ 78,298,032
<br />$ 74,609,968
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