9.d) Amendments of 2011 Equipment Replacement Fund and Capital Improvement Fund Budgets Meeting Date: 4/19/2011
Agenda Item: � �/�
City Council Agenda Report
City of Scandia
14727 209�' St. North
Scandia, MN 55073 (651) 433-2274
Action Requested: Approve amendments to the 2011 Equipment Replacement Fund and
Capital Improvement Fund budgets relating to financing the
replacement of the 1997 Ford Dump Truck with Plow.
Deadline/Timeline: The amendments should be approved at the April 19 meeting in order to
meet the schedule for issuance of an equipment certificate by the end of
May.
Background: • At the Apri112 work session, the Council decided to proceed with
the replacement of the 1997 Ford Dump Truck with a new heavy-
duty tandem Mack truck. Rather than making a cash purchase, as
anticipated by the 2011 budget, the Council decided to issue an
equipment certificate in the amount of$150,000 with the balance of
the estimated $199,000 purchase price to come from funds on hand.
The goal is to issue the certificate by May 31 in order to avoid a
potential restriction on new debt, which is under discussion at the
state legislature.
• The 2011 budget needs to be amended to reflect the change in the
truck financing. Most of the changes needed are in the Equipment
Replacement Fund (406) budgets. A proposed $10,000 operating
transfer from the Capital Improvement Fund (401) expense budget
to the Equipment Replacement Fund may also be eliminated as it is
no longer needed to avoid a deficit in that fund. The recommended
changes are shown on the attached draft resolution.
• A forecast of the income and expenses to the Equipment
Replacment Fund, assuming the budget amendments are approved,
is attached.
Recommendation: The Council should adopt the attached resolution.
Attachments/ • Draft Resolution 04-19-11-06
Materials provided:
Contact(s):
Prepared by: Anne Hurlburt, Administrator
(budget amendments truck replacement)
Page 1 of 2
04/14/11
Equipment Replacement Fund Forecast,4/14/11
Balance, 3/31/11 $ 89,216
Revenue
Interest 391
Sale of GMC Pickup 500
Sale or Trade Ford Dump Truck 15,000
Operating Transfers 110,000
Certificate of Indebtedness 150,000
$ 275,500
Expense
Legal Fees 2,500
Heavy Machinery Capital (Mower) 5,566
Motor Vehicles Capital (Pickup, Plow Truck) 230,410
$ 238,476
Projected Balance, 12/31/11 $ 126,240
Page 2 of 2
04/14/11
_ �
CITY OF SCANDIA
RESOLUTION NO.: 04-19-11-06
RESOLUTION AMENDING ZO11 EQUIPMENT REPLACEMENT FUND AND
CAPITAL IMPROVEMENT FUND BUDGETS
WHEREAS,the City of Scandia 2011 Budget was adopted on December 21, 2010 and
WHEREAS, the City Council has determined that the city should finance the planned
purchase of a replacement dump truck/ snow plow by issuing a Certificate of Indebtedness rather
than depleting the balance of the Equipment Replacement Fund; and
WHEREAS, the City Council has determined that a transfer of cash from the Capital
Improvement Fund to the Equipment Replacement Fund will not be necessary to provide sufficient
funds for the truck purchase;
NOW, THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF
THE CITY OF SCANDIA, WASHINGTON COUNTY, MINNESOTA, that it should and
hereby does amend the 2011 Budget as follows:
Adopted Amended
Fund/Budget Account Budget Budget Difference
Equipment Replacement, Revenue 36260 Sale of Equipment $0 $15,500 +$15,500
Equipment Replacement,Revenue 39350 Certif. of Indebtedness $0 $150,000 +$150,000
Equipment Replacement, Revenue 39200 Interfund Transfer $120,000 $110,000 -$10,000
Equipment Replacement,Expense 304 Legal Services $0 $2,500 +$2,500
Equipment Replacement, Expense 540 Heavy Machinery Capital $0 $5,566 +5,566
Equipment Replacement, Expense 540 Motor Vehicles Capital $234,500 $230,410 -$8,365
Capital Improvement,Expense 720 Operating Transfer $10,000 $0 -$10,000
Adopted by the Scandia City Council this 19th day of April, 2011.
Randall Simonson, Mayor
ATTEST:
Anne Hurlburt, Administrator/ Clerk