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Home My WebLink About2016.07.05 CC PowerPoint Audit Presentationja CITY OF HUGO Financial Summary - 2015 HLIGO t� X/ ~- iL \_ t SMITH �SCHAFER � AYES LTV C4,1"Iod PwWU •oowwntbnry 4n1 Conauncnn YEARS Smithschafer.com -1971 • • Audit Opinion Audit A& '/_ • Provides reasonable, but not absolute, assurance that financials are free of material misstatement • Audit procedures include: outside confirmation of certain balances and transactions, sample tests of documentary evidence, inquiries of employees and management, analytical procedures applied to balances and certain other testing procedures • Unmodified opinion — Financial Statements fairly stated in all material respects Minnesota Legal Compliance • Seven areas required to be tested by the State of Minnesota: contracting and bidding, deposits and investments, conflicts of interest, public indebtedness, claims and disbursements, miscellaneous provisions and tax increment financing. The items required to be tested for each area are listed in the Office of the State Auditor's Minnesota Legal Compliance Guide for Cities • Testing covered all of the listed areas and consisted of inquiries, sighting of documents and testing on a sample basis • One exception noted — Several City checks issued in 2012 were still uncashed at the end of 2015. smithschafer.com SNITTH �SCHAFER � AYES LTV C4""Ied P••ac ••••wntbnrs 4n1 CQ-Sulrin» 4 n ,YEARS �> 1971 I • Governmental J& Fund Types • General Fund • Special Revenue Funds • Debt Service Funds • Capital Projects Funds • Enterprise • Water • Sewer t SMITH �SCHAFER � AYES LTV C4,1"Ied Pw7c •ocemitt o 4n1 ConauHann 4 n ,YEARS smithschafer.com .1971 3 s� ja Governmental Funds Revenues SNITTH �SCHAFER � AYES LTV C4,1"Ied PwWU •oowwntbnry 4n1 Consulrcn» W-1971 EARS Smithschafer.com Governmental Fund Revenues $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $- $(1,000,000) 2011 ❑ Property taxes ❑ Intergovernmental ■ Investment earnin, M 2012 2013 2014 2015 E3 Special assessments ❑ Charges for services ■ Developer fees ❑ Licenses and permits ❑ Court fines ■ Miscellaneous ZIA SMITH*SCHAFER 8 A B 8 0 C t A f E 8 L T C Co1"N Porte AOOwww"Wf1 and CQA*Unsnl% 4 (1,YEARS smithschafer.com `T 19 7 1 5 Governmental Funds Expenditures SNITTH �SCHAFER � AYES LTV C4,1"Ied PwWU •oowwntbnry 4n1 Consulrcn» 4 WEARS smithschafer.com z 19 71 General Governmental Expenditures $1,000,000 $900,000 $800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $0 2011 2012 2013 2014 2015 Includes mayor and council, admin., elections, clerk/treasurer, finance director, assessing, accounting services, planning and zoning, engineering, legal fees, and general government building Represents 23% of governmental expenditures (excluding capital projects and debt service) in 2015 Totaled $979,788 in 2015, a decrease of $6,432 (less than 1 %) from 2014 ZIA smrni*SCHAFER 8 A B 8 0 C t A f E 8 L T C Cor"*" Porte AOOwww"Wfl and CQA*Unsnl% 4 (� ,YEARS smithschafer.com �f .1971 7 $1,800,000 $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $0 � J 0) Public Safety Expenditures 2011 2012 2013 2014 2015 ■Police ■ Protective Inspection ❑ Fire Protection ■Animal Control • Includes police, fire protection, protective inspection, and animal control • Public Safety represented about 37% of total governmental expenditures (excluding capital projects and debt service) in 2015 • Totaled $1,571,184 in 2015, an increase of $151,069 (11 %) from 2014 • Increase in public safety expenditures in 2015 is due primarily to an increase in police contracted services z/ SMITH �SCHAFER � AYES LTV C4,1"Ied PwWU •oowwntbnry 4n1 Consulrcn» 4 n ,YEARS smithschafer.com �> 19 7 1 8 $1,400,000 $1,200,000 $1,000,000 $600,000 $400,000 $200,000 $0 ja Highways and Streets Expenditures 2011 2012 2013 2014 2015 • Includes administration and engineering, streets, and street lighting • Primarily supplies and street materials • Totaled $1,204,844 in 2015 and $1,204,207 in 2014 — an increase of less than 1 % SNITTH �SCHAFER � AYES LTV C4,1"Ied PwWU •ocemitt ro 4n1 Consulrcn» 4 n ,YEARS smithschafer.com �> 19 7 1 9 $200,000 $175,000 $150,000 $125,000 $100,000 $75,000 $50,000 $25,000 $0 ja Community Development � Expenditures 2011 2012 2013 2014 2015 • Includes personal services, other services and charges, and capital outlay • Totaled $43,498 in 2015, an increase of $23,153 (114%) from 2014 • Large decrease in 2012 due to decreased personal services as the City has not replaced the vacancy created when the Community Development Director was named City Administrator • Increase in 2015 was due primarily to the hiring of an community development assistant SN rm �SCHAFER � AYES LTV C4,1"Ied PwWU •oowwntbnry 4n1 Consulrcn» 40 ,YEARS smithschafer.com "1971 10 IA Ap e -700000,0-J Governmental Fund Expenditures 2014 Other Parks Unallocated Community 9% 3% Development n /� < 1% II H ig hway� and Streel 29% smithschafer.com 2015 Parks Other Unallocated 8% Community 3% Development 1% Highway and Strep 28% SNITTH �SCHAFER � AYES LTV C4,Y"Ied Pw7c •oowwnL►nr► 4n1 Con►°Ir►n» 4 n ,YEARS �> 1971 1 1 General Fund smithschafer.com Reserves SNITTH �SCHAFER � AYES LTV C4,1"Iod PwWU •acomia ro 4n1 Conmulrcn» 4 w,:1971 EARS General Fund - Reserves 2011 2012 2013 2014 2015 oUnassigned Fund Balance ■General Fund Expenditures smithschafer.com • Unassigned General Fund balance as a % of General Fund expenditures • 2015 57% • 2014 56% • 2013 54% • 2012 54% • 2011 54% • State Auditor recommendation is 35 to 50% in unreserved fund balance SNITTH �SCHAFER � AYES LTV C4,1"Ied PwWU •ocewitt ro 4n1 Consulrcn» 4 n ,YEARS �> 1971 13 1 I a A& Purposes & Benefits of Reserves Purpose of Reserves Cash flow timing differences Intergovernmental revenue cutbacks Capital outlay replacement t� ex, �-- iL Benefits of Reserves Favorable bond rating Higher investment earnings Provides resources for minor projects or feasibility reports Avoids temporary overdrafts prior to major receipts Emergency or unanticipated - Allows time to study effects of revenue expenditures cuts Avoids overburdening of annual budgets Special Cit Council projects for certain capital outlay p y p _ Provides the City greater options to deal with unexpected events Unfunded mandates smithschafer.com ZSMITH �SCHAFER � AYES LTV C4,1"Ied Paw7c •ocemitt o and Coeauttams 4 W EARS t1971 14 smithschafer.com j Debt Service SNITTH �SCHAFER � AYES LTV C4,1"Iod Pw7c •oaamitt o 4n1 Con►ulr►nr► 4W.-1971 R 5 Year Debt Service Requirements t-. �-- iL 'XI t • All bond payments are being paid on a timely basis • Includes principal and interest • Made up entirely of general obligation debt ZA smrrH*SCHAFER 8 A B 8 0 C t A f E 8 L T C C.rflN Porte A.O.Ynf.nfl and C.e•Unsnl% 4 W.1971 EARS smithschafer.com 16 e -700000,0-J R qw Capital Projects SNIITH•SCHAFER _—_ • A S S O C, AYES LTV P C4,1"Ied w79 •oowMnL►nr► 4n1 Con►ulr►n» 4 WEARS Smithschafer.com 1971 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 J& Capital Projects Funds — Expenditures 2011 2012 2013 2014 2015 ■ Miscellaneous ❑ Property & Equipment Acquisition ❑ Improvements ❑ Sealcoating ❑ Cracksealing ■ Construction / Repair t� X/ \_ iL • Major capital projects in 2015 were: • Purchase of a Mack plow truck • Purchase of a new dump truck and a new water truck • Completion of the Rosemary Way street improvement and 165th Street reconditioning projects • Rice Lake Meadows street improvement project • Major capital projects in 2014 were: • Replace Sterling plow truck • Rosemary Way street improvements • 165th Street reconditioning project Z: I SMITH �SCHAFER C4n"Ied Pwlt •oowwnL►nr► 4n1 Con►ulr►n» 40 ,YEARS smithschafer.com "19 71 18 ♦ J i Enterprise Funds Operational Trends smithschafer.com SNITTH �SCHAFER � AYES LTV C4,1"Ied PwWU •ocemitt ro 4n1 Conmulrcn» 4 W,:1971 EARS PV CDPI Water and Sewer Fund , $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 2011 2012 2013 2014 2015 0 Revenues smithschafer.com 0 Expenses 0 Net Income (Before Transfers) SNIITH•SCHAFER i _ • A 8 f 0 C 1 A T E 8 L T C C4""led Pssac AooAWntbnrs 4n1 C* -Midrin» 4 n ,YEARS 19 71 20 ja Water and Sewer Fund (Cont'd) • Water and sewer service supported by ratepayers • Increased usage for population and commercial industrial growth have created increases in operating revenues, operating expenses and other income • Higher than normal revenues in 2012 due to a one-time refund to the City for previous expenditures, as well as higher future infrastructure charges • Other income includes future infrastructure charges, developer fees, special assessments, investment earnings and other miscellaneous income and expenses • Fund balance growing each year due to net income (positive income each year even after subtracting depreciation) Z/ SMITH �SCHAFER AYES LTV C4,Y"Ied Pwlt •oowwntbnrs 4n1 C*.MUtrin» 4 n ,YEARS smithschafer.com "19 7 1 21 ja Summary t� ,XI --oZz- I kL [U Unmodified audit opinion and one Minnesota Legal Compliance exception CAFR has been posted on the City's website by the Finance Department -------_�l� CAFR is available for public inspection by contacting the City's Finance Department 0 A summary of the financial information has been published in the City's official newspaper t SMITH �SCHAFER � AYES LTV C4,1"Ied Pw7c •oowwntbnry 4n1 Conaunann 4 n ,YEARS smithschafer.com `=1971 22