Loading...
9.d) Part 2 - 2008 Audit and Financial Statements � ' � ' � ' BASIC FINANCIAL STATEMENTS � � , r � i 1 i 1 1 1 1 I ! 1 1 i 1 i 1 1 1 r � � � f � � � � � , CITY OF SCANDIA MINNESOTA , , STATEMENT OF NET ASSETS DECEMBER 31, 2008 ' Governmental Business-Type , Activities Activities Totals ASSETS Cash and Investments $ 1,261,111 $ 118,986 $ 1,380,097 � Receivables: Taxes and Other 116,323 3,510 119,833 Special Assessments 258,162 29 258,191 Due from County - 4,669 4,669 , Unamortized Issue Costs 14,323 - 14,323 Capital Assets, Unaudited 5,949,923 930,000 6,879,923 Total Assets 7,599,842 1,057,194 8,657,036 , LIABILITIES Accounts and Contracts Payable 45,457 6,739 52,196 , Salaries and Wages Payable 30,925 = 30,925 Interest Payable 9,315 9,315 Deferred Revenues 4,350 - 4,350 Due to Other Governments 73,755 - 73,755 � Noncurrent Liabilities: Due Within One Year 471,728 471,728 Due in More Than One Year 1,612,929 - 1,612,929 � Total Liabilities 2,248,459 6,739 2,255,198 NET ASSETS � Invested in Capital Assets, Net of Related Debt 3,844,923 930,000 4,774,923 Restricted for Debt Retirement 375,805 375,805 Unrestricted 1,130,655 120,455 1,251,110 � Total Net Assets $ 5,351,383 $ 1,050,455 $ 6,401,838 , , , ' � ' See accompanying Notes to Basic Financial Statements. , (14) ! CITY OF SCANDIA, MINNESOTA STATEMENT OF ACTIVITIES , YEAR ENDED DECEMBER 31, 2008 ' Program Revenues ' Operating Capitai Grants Charges for Grants and and FUNCTIONS/PROGRAMS Expenses Service Contributions Contributions � Government Activities: General Government $ 554,020 $ 182,621 $ 2,521 $ - Public Safety 385,665 22,774 26,942 - Public Works 419,324 3,597 - 28,484 , Parks and Recreation 108,059 71,894 - - Interest and Fiscal Charges 99,235 5,618 - - Total Governmental Activities 1,566,303 286,504 29,463 28,484 ' Business-Type Activities: Sewer 90,983 57,010 - 3,328 � Total Primary Government $ 1,657,286 $ 343,514 $ 29,463 $ 31,812 GENERAL REVENUES , Taxes: Property Taxes, Levied for General Purposes Grants and Contributions not Restricted for a Particular Purpose � Investment Earnings Transfers Total General Revenues � CHANGE IN NET ASSETS Net Assets- Beginning of Year � NET ASSETS - END OF YEAR � � � � � , See accompanying Notes to Basic Financial Statements. � (15) , � , Net(Expense) Revenue and , Changes in Net Assets Governmentai Business-Type � Activities Activities Total $ (368,878) $ - $ (368,878) (335,949) - (335,949) � (387,243) _ (387,243) (36,165) (36,165) (93,617) - (93,617) � (1,221,852) - (1,221,852) � - (30,645) (30,645) (1,221,852) (30,645) (1,252,497) � 1,645,374 - 1,645,374 , 42,709 - 42,709 41,829 2,915 44,744 3,339 (3,339) - ' 1,733,251 (424) 1,732,827 511,399 (31,069) 480,330 1 4,839,984 1,081,524 5,921,508 $ 5,351,383 $ 1,050,455 $ 6,401,838 � � � � ' � � (16) , CITY OF SCANDIA, MINNESOTA BALANCE SHEET , GOVERNMENTAL FUNDS DECEMBER 31, 2008 , Debt Service , 2004 2007 2000 General Improvement Improvement Fire Hall Fund Bond Bond Bond � ASSETS Cash and Investments $ 585,967 $ 165,302 $ 46,039 $ 167,567 Taxes Receivable 94,368 1,264 885 843 � Special Assessments Receivable - 46,353 187,343 - Other Receivables _ 17,206 - - - Due from Other Funds 19,925 - - - Total Assets $ 717,466 $ 212,919 $ 234,267 $ 168,410 ' LIABILITIES AND FUND BALANCES � Liabilities: Accounts and Contracts Payable $ 45,457 $ - $ - $ - Accrued Payroll, Taxes and Benefits 30,925 - - - � Deferred Revenue 43,880 46,273 187,804 843 Due to Other Governments 73,755 - - - Due to Other Funds - - - - Total Liabilities 194,017 46,273 187,804 843 ' Fund Balances: Reserved for Debt Service - 166,646 50,907 167,567 , Unreserved, Designated for Capital Improvements - - - - Unreserved, Undesignated 523,449 - (4,444) - � Total Fund Balances 523,449 166,646 46,463 167,567 Total Liabilities and Fund Balances $ 717,466 $ 212,919 $ 234,267 $ 168,410 i 1 � i 1 � See accompanying Notes to Basic Financial Statements. � (17) � , � ' Nonmajor Capital Governmental � Improvements Funds Totals $ 212,140 $ 84,096 $ 1,261,111 257 - 97,617 � _ 24,466 258,162 _ 1,500 18,706 - - 19,925 � $ 212,397 $ 110,062 $ 1,655,521 1 $ - $ - $ 45,457 - - 30,925 ' 257 24,466 303,523 73,755 - 19,925 19,925 , 257 44,391 473,585 � - - 385,120 212,140 85,596 297,736 - (19,925) 499,080 � 212,140 65,671 1,181,936 $ 212,397 $ 110,062 $ 1,655,521 � i � � 1 1 � (18) � � � � � � � ' , � � � � , � � i i � � CITY OF SCANDIA, MINNESOTA � RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET ASSETS GOVERNMENTAL ACTIVITIES � DECEMBER 31, 2008 � TOTAL FUND BALANCES FOR GOVERNMENTAL FUNDS $ 1,181,936 � Totai net assets reported for governmental activities in the statement of net assets is different because: Capital assets used in governmentai activities are not financial ' resources and, therefore, are not reported in the funds. These capital assets consist of: ' Land $ 715,450 Buildings 1,966,800 Furniture and Fixtures 372,362 , Equipment 398,649 Infrastructure 1,464,379 Miscellaneous Assets 419,438 � Vehicles 612,845 5,949,923 Some receivables, including special assessments, are reported as deferred revenue in the fund financial statements but are recognized as � revenue when earned in the government-wide statements. These deferred revenues consist of: � Special Assessments on Tax Roll 42,779 Other Special Assessments 256,394 299,173 Bond issuance costs are reported as expenditures in the governmental , funds and are shown as assets net of accumulated amortization on the statement of net assets. 14,323 ' Some liabilities are not due and payable in the current period and, therefore, are not reported in the funds. These liabilities consist of: � General Obligation Debt Payable (2,084,657) Accrued Interest on Long-Term Debt (9,315) (2,093,972) � TOTAL NET ASSETS OF GOVERNMENTAL ACTIVITIES $ 5,351,383 � , � See accompanying Notes to Basic Financial Statements. � (19) ' CITY OF SCANDIA, MINNESOTA STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE � GOVERNMENTAL FUNDS YEAR ENDED DECEMBER 31, 2008 ' Debt Service � 2004 2007 2000 General Improvement Improvement Fire Hall Fund Bond Bond Bond � REVENUES Taxes $ 1,301,526 $ 152,574 $ 42,000 $ 127,717 Special Assessments - 39,083 98,925 - Intergovernmental Revenue 63,259 - - _ � Licenses and Permits 66,132 - - _ Charges for Services 151,870 - - _ Fines and Forfeits 15,953 - - - , User Fees - - _ _ Miscellaneous Revenue 48,280 4,848 - 3,583 Total Revenues 1,647,020 196,505 140,925 131,300 EXPENDITURES i Current: General Government 552,601 - - - � Public Safety 385,665 - - - Public Works 360,461 - - - Parks and Recreation Center 86,333 - - _ Debt Service: � Principal Payments 20,000 240,000 250,000 745,000 Interest Payments 590 15,240 56,858 41,538 Capital Outlay: � General Government - - - _ Public Works - - - _ Parks and Recreation Center - - - _ Total Expenditures 1,405,650 255,240 306,858 786,538 , EXCESS OF REVENUES OVER (UNDER) EXPENDITURES 241,370 (58,735) (165,933) (655,238) OTHER FINANCING SOURCES(USES) � Transfer in 302,397 - 212,396 665,000 Transfer out (40,000) (665,000) - - � Total Other Financing Sources(Uses) 262,397 (665,000) 212,396 665,000 NET CHANGE IN FUND BALANCES 503,767 (723,735) 46,463 9,762 � Fund Balances-Beginning of Year 19,682 890,381 - 157,805 FUND BALANCES -END OF YEAR $ 523,449 $ 166,646 __� 46,463 � 167,567 � � � See accompanying Notes to Basic Financial Statements. � (20) � � , � Nonmajor Total Capital Governmental Governmental Improvements Funds Funds , $ 524 $ 1,802 $ 1,626,143 - 1,831 139,839 � 12,567 = 75,826 66,132 - - 151,870 - - 15,953 � - 4,500 4,500 4,769 24,744 86,224 17,860 32,877 2,166,487 � - - 552,601 � _ - 385,665 360,461 - 16,487 102,820 � - 205,000 1,460,000 - 4,561 118,787 � 4,750 - 4,750 14,083 57,730 71,813 5,239 - 5,239 ' 24,072 283,778 3,062,136 (6,212) (250,901) (895,649) � - 40,000 1,219,793 � = (511,454) (1,216,454) (471,454) 3,339 (6,212) (722,355) (892,310) � 218,352 788,026 2,074,246 � $ 212,140 $ 65,671 $ 1,181,936 i � � (21) � � , � � � � i � 1 � 1 1 � f 1 � 1 � � CITY OF SCANDIA , MINNESOTA RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, , EXPENDITURES, AND CHANGES IN FUND BALANCE TO THE STATEMENT OF ACTIVITIES GOVERNMENTAL ACTIVITIES YEAR ENDED DECEMBER 31, 2008 ' iNET CHANGE IN FUND BALANCES -TOTAL GOVERNMENTAL FUNDS $ (892,310) Amounts reported for governmental activities in the statement of activities are � different because: Capital outlays are reported as expenditures in governmental funds. � However, in the statement of activities, the cost of capital assets is allocated over their estimated useful lives as depreciation expense. In the current period, these amounts are: � Capital Outlays Reported in Governmental Fund Statements 12,950 Receivables not currently available are reported as deferred revenue in the � fund financial statements, but are recognized as revenue when earned in the government-wide statements. (92,124) The governmental funds report bond proceeds as financing sources, while � repayment of bond principal is reported as an expenditure. In the statement of net assets, however, issuing debt increases long-term liabilities and does not affect the statement of activities and repayment of � principal reduces the liability. Also, governmental funds report the effect of issuance costs, premiums and discounts when debt is first issued, whereas these amounts are deferred and amortized in the statement of activities. Interest is recognized as an expenditure in the governmental � funds when it is due. In the statement of activities, however, interest expense is recognized as it accrues, regardless of when it is due. The net effect of these differences in the treatment of general obligation bonds and � related items is as follows: Bond Discount 11,474 Bond Issuance Costs 7,358 � Repayment of Bond Principal 1,460,000 Change in Accrued Interest Expense 11,309 Amortization of Bond Issue Costs (3,542) � Amortization of Bond Discount (7,047) 1,479,552 In the statement of activities, compensated absences are measured by the � amounts earned during the year. In the governmental funds, however, expenditures for these items are measured by the amount of financial resources used (especially, the amounts actually paid). During the year the balance of compensated absences payable decreased. 3,331 � CHANGE IN NET ASSETS OF GOVERNMENTAL ACTIVITIES $ 511,399 � � See accompanying Notes to Basic Financial Statements. � (22) r � � � � � i i � 1 � ! � � � � i i � � CITY OF SC ANDIA, MINNESOTA � STATEMENT OF NET ASSETS PROPRIETARY FUND DECEMBER 31, 2008 � � Sewer Enterprise ASSETS Fund � Current Assets: Cash and Investments $ 118,986 Special Assessments Receivable 29 Other Accounts Receivable 3,510 � Due from County 4,669 Total Curren_tAssets 127,194 � Noncurrent Assets: Capital Assets: Collection Systems 1,500,000 � Less: Accumulated Depreciation (570,000) Total Capital Assets 930,000 Total Assets _$ 1,057,194 � LIABILITIES � Cu�rent Liabilities: Accounts Payable $ 6,739 � NET ASSETS Invested in Capital Assets, Net of Related Debt 930,000 Unrestricted 120,455 Total Net Assets 1,050,455 � Total Liabilities and Net Assets $ 1,057,194 � ' � � � , See accompanying Notes to Basic Financial Statements. � (23) r �� TY OF SCANDIA, MINNESOTA � STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET ASSETS PROPRIETARY FUND YEAR ENDED DECEMBER 31, 2008 � � Sewer Enterprise Fund � OPERATING REVENUES Charges for Service $ 60,338 OPERATING REVENUES � Depreciation 30,000 Utilities 1,353 Maintenance and Other 59,630 � Total Operating Expenses 90,983 OPERATING LOSS (30,645) � NONOPERATING REVENUE Interest Revenue 2,915 � LOSS BEFORE TRANSFERS (27,730) Transfer Out (3,339) � CHANGE IN NET ASSETS (31,069) � Net Assets - Beginning of Year 1,081,524 NET ASSETS -END OF YEAR $ 1,050,455 ' t i � � ! � See accompanying Notes to Basic Financial Statements. � (24) � � � � � � r t � � � � � i � � ! i � � CITY F O SCANDIA, MINNESOTA � STATEMENT OF CASH FLOWS PROPRIETARY FUND YEAR ENDED DECEMBER 31, 2008 � � Sewer Enterprise Fund � CASH FLOWS FROM OPERATING ACTIVITIES Cash Received from Customers $ 55,487 Cash Paid to Suppliers for Goods and Services �79,288� Net Cash Used by Operating Activities (23,801) � CASH FLOWS FROM.NONCAPITAL FINANCING ACTIVITIES Transfer Out (3,339) � CASH FLOWS FROM INVESTING ACTIVITIES Interest on Investments 2,915 � NET DECREASE IN CASH AND CASH EQUIVALENTS (24,225) Cash and Cash Equivalents- Beginning of Year 143,211 � CASH AND CASH EQUIVALENTS -END OF YEAR $ 118,986 ! RECONCILIATION OF OPERATING LOSS TO NET CASH USED BY OPERATING ACTIVITIES � Operating Loss $ (30,645) Adjustments to Reconcile Operating Loss to Net Cash Provided by Operating Activities: Depreciation Expense 30,000 � Changes in Asset and Liability Accounts: Decrease in Special Assessments Receivable 3,328 Decrease in Other Accounts Receivable (3,510) 1 Increase in Due from County (4,669) Increase in Accounts Payable (18,305) � Net Cash Used by Operating Activities $ (23,801) � � � i See accompanying Notes to Basic Financial Statements. � (25) � CITY OF SCANDIA, MINNESOTA � STATEMENT OF NET ASSETS FIDUCIARY FUND YEAR ENDED DECEMBER 31, 2008 � � Agency Fund ASSETS Current Assets: 1 Cash and Investments _� 48.777 LIABILITIES � Current Liabilities: Contractor Deposits $ 48,777 � ' � � � � � � � � � � See accompanying Notes to Basic Financial Statements. � (26) � CITY OF SCANDIA MINNESOTA � NOTES TO BASIC FINANCIAL STATEMENTS � DECEMBER 31, 2008 � NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES � City of Scandia is a public corporation formed under Minnesota Statute 412. As such, the City is under statutory city regulations and applicable statutory guidelines. � The basic financial statements of the City have been prepared in conformity with U.S. 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 U.S. generally accepted accounting principles, the financial statements of the reporting entity include all funds, departments, agencies, boards, commissions, � and other organizations over which City officials exercise oversight responsibility. Component units are legally separate entities for which the City (primary government) is � financially accountable, or for which the exclusion of the component unit would render the financial statements of the Primary Government misleading. The criteria used to determine if the Primary Government is financially accountable for a component unit � include whether or not the Primary Government appoints the voting majority of the potential component uniYs governing body, is able to impose its will on the potential component unit, is in a relationship of financial benefit or burden with the potential component unit, or is fiscally depended upon by the potential component unit. � Based on these criteria, there are no organizations considered to be component units of the City. � � � ' � � � � (27) � CITY OF SCAN DIA, MINNESOTA � NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2008 � NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) �, B. BASIC FINANCIAL STATEMENTS � 1. Government-Wide Statements The government-wide financial statements (i.e., the statement of net assets and the statement of activities) display information about the primary government. These , statements include the financial activities of the overall City government, except for fiduciary activities. 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 to external parties for support. As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this general rule are � charges between the City's enterprise funds and various other functions of government. Eliminations of these charges would distort the direct costs and program revenues reported for the various functions concerned. , In the government-wide statement of net assets, both the governmental and business-type activities columns: (a) are presented on a consolidated basis by � column; and (b) are reported on a full accrual, economic resource basis, which recognizes all �ong-term assets and receivables as well as long-term debt and obligations. The City's net assets are reported in three parts: (1) invested in capital � assets, net of related debt; (2) restricted net assets; and (3) unrestricted net assets. The City first utilizes restricted resources to finance qualifying activities. The statement of activities demonstrates the degree to which the direct expenses of � each function of the City's governmental activities and different business-type activities are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or activity. Program revenues include: (1) fees, � fines, and charges paid by the recipients of goods, services, or privileges provided by a given function or activity; and (2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or activity. � Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. � 2. Fund Financial Statements The fund financial statements provide information about the City's funds, including � its fiduciary funds. Separate statements for each fund category (governmental, proprietary, and fiduciary) are presented. The emphasis of governmental and proprietary fund financial statements is on major individual governmental and enterprise funds, with each displayed as separate columns in the fund financial � statements. All remaining governmental and enterprise funds are aggregated and reported as nonmajor funds. � � (2a) � � � � i i ! ! i 1 ! 1 � � 1 � � � � � CITY OF SC ANDIA, MINNESOTA � NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2008 � NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) � B. BASIC FINANCIAL STATEMENTS (CONTINUED) � 2. Fund Financial Statements (Continued) Proprietary fund operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of the fund. Exchange � transactions are those in which each party receives and gives up essentially equal values. Nonoperating revenues, such as subsidies and investment earnings, result from nonexchange transactions or incidental activities. � The City reports the following major governmental funds: � General Fund The general fund is the City's primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in � another fund. Capital Improvements This fund records all revenues and expenditures related to various infrastructure � improvement projects within the City, except those projects paid from business type activities (enterprise funds). � 2004, 2007, and 2000 Fire Hall Debt Service Funds These debt service funds account for debt service payments used to finance the � City's various improvement projects. The City reports the following major proprietary fund: � Sewer Fund The sewer fund accounts for customer sewer service charges that are used to � finance sewer operating expenses. � � � � � (29) � CITY OF SCANDIA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS � DECEMBER 31, 2008 � NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) � B. BASIC FINANCIAL STATEMENTS (CONTINUED) � 2. Fund Financial Statements (Continued) Additionally, the City reports the following fiduciary fund: � Aqencv Fund To account for assets held as an agent for individuals, private organizations, other governmental units, and/or other funds. The City's agency fund accounts for pass- Mthrough contractor's deposits relating to prospective developments. C. MEASUREMENT FOCUS AND BASIS OF ACCOUNTING � The government-wide and proprietary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Agency � funds, which are included in the Fiduciary Funds, do not have a measurement focus. 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. � Private-sector standards of accounting and financial reporting issued on or before November 30, 1989, generally are followed in both the government-wide and � proprietary fund financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following subsequent private-sector guidance for their business-type activities and enterprise funds, subject to this same limitation. The � City has elected not to follow subsequent private-sector guidance. 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. The City considers all revenues to be available if they are collected within 60 days after the end of the � current period. Property and other taxes, licenses, and interest are all considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt, compensated � absences, and claims and judgments, which are recognized as expenditures to the extent that they have matured. Proceeds of general long-term debt and acquisitions under capital leases are reported as other financing sources. � � � �30> � � � � � � � � � � i � i I � � � i � � CITY OF SCANDIA, MINNESOTA � NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2008 , NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) � F. PROPERTY TAX CREDITS � Property taxes on homestead property (as defined by State Statutes) are partially reduced by property tax credits. These credits are paid to the City by the State in lieu of taxes fevied against homestead property. The State remits these credits through � installments each year. These credits are recognized as revenue by the City at the time of collection. G. 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 coflected by the County and remitted to the City on or before July 15 � and December 15 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. � Within the 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 the following January are recognized as revenue for the current year. Taxes and credits not received at the 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 it is not available to finance current expenditures. Deferred revenue in governmental activities is susceptible to full accrual on the government-wide statements. � The City's property tax revenue includes payments from the Metropolitan Revenue Distribution (Fiscal Disparities Formula) per Minnesota Statute 473F. This statute � provides a means of spreading a portion of the taxable valuation of commercial/industrial real property to various taxing authorities within the defined metropolitan area. The valuation "shared" is a portion of commercial/industrial property � valuation growth since 1971. Property taxes paid to the City through this formula for 2008 totaled $74,058. Receipt of property taxes from this "fiscal disparities pool" does not increase or decrease total tax revenue. � � � (32) � CITY OF SCANDIA, MINNESOTA � NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2008 � NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) � H. 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 o�prepayment penalties. � Within the fund financial statements, the 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 are collected by the County and remitted by December 31 � (remitted to the City the following January) and are also recognized as revenue for the current year. All remaining delinquent, deferred and special deferred assessments receivable in governmental funding are completely offset by deferred revenues. � Deferred revenue in governmental activities is susceptible to full accrual on the government-wide statements. � 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 and the first proceeds of that sale � (after costs, penalties and expenses of sale) are remitted to the City in payment of delinquent special assessments. Generally, the City will collect the full amount of its special assessments not adjusted by the City's City Council or court action. 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. � � � � � � (33) # 1 � � � I � 1 � � � � � ! � � � � � � CITY OF SCANDIA, MINNESOTA � NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2008 � NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) ` I. CAPITAL ASSETS � Capital assets, which include property, plant, equipment, and infrastructure assets are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. The City has not adopted a capitalization policy � threshold for determining additions but rather capitalizes all capital related expenditures at historical cost or estimated historical cost. The cost of norma� maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Major outlays for capital assets and improvements are capitalized as � projects are constructed. The capital assets of the governmental activities are not depreciated. The capital � assets of the Enterprise Funds are depreciated using the straight-line method over the estimated useful lives of the assets. The estimated useful life for the Sewer Plant is 50 years. MJ. COMPENSATED ABSENCES � It is the City's policy to permit employees to accumulate earned but unused leave benefits. All leave pay is accrued on a per pay period basis and recorded in the government-wide financial statements. The current portion is calculated based on � historical trends. K. LONG-TERM OBLIGATIONS � In the entity-wide financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities. Bond premiums and discounts are deferred and amortized over the life of the bonds using the straight-line � method. Bond issue costs, if material, are reported as deferred charges and amortized over the term of the related debt using the straight-line method. � In the governmental fund financial statements, bond premiums and discounts, as well as bond issue costs are recognized during the current period. The face amount of the debt issue is reported as an other financing source. Premiums received on debt � issuances are reported as other financing sources while discounts are reported as other financing uses. Issue costs are reported as debt service expenditures. � L. FUND BALANCE In the governmental fund financial statements, reservations of fund balance represent � those portions of fund balance not appropriable for expenditure or legally restricted by outside parties for use for a specific purpose. Designated fund balances represent tentative plans for future use of financial resources that are subject to change. � � (34) # � � � � � � � � � 1 r � � � � � � � � CITY OF SCANDIA, MINNESOTA � NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2008 � NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) � M. 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 or expenses in the fund that is reimbursed. All other interfund transactions are reported as transfers. �` All interfund transactions are eliminated except for activity between governmental � activities and business-type activities for presentation in the entity-wide statements of net assets and statements of activities. � N. NEW ACCOUNTING PRONOUNCEMENTS � In June 2004, the GASB issued Statement No. 45, Accounting and Financial Reporting by Employees for Postretirement Benefits Other than Pension. This statement is effective for the City for the year ending December 31, 2009. The effect of GASB � Statement No. 45 will have on the fiscal year 2009 basic financial statements has not yet been determined. � The GASB issued Statement No. 51, Accounting and Financial Reporting for Intangible Assets. This Statement requires that all intangible assets, including easements, water rights, timber rights, patents, trademarks, and computer software, be classified as capital assets. This Statement also establishes guidance specific to intangible assets � related to amortization and provides guidance on determining the useful life of intangible assets when the length of their life is limited by contractual or legal provisions. Intangible assets with indefinite useful lives should not be amortized unless � their useful life is subsequently determined to no longer be indefinite due to a change in circumstances. The requirements of this Statement will be effective for the City's fiscal year ending December 31, 2010, and may be implemented prospectively. The effect � that GASB Statement No. 51 will have on the fiscal year 2010 basic financial statements has not been determined. In March 2009, Governmental Accounting Standards Board issued GASB Statement � No. 54, Fund Ba/ance Reporting and Governmental Fund Type Definitions. The requirements of this Statement are effective for the City's fiscal year ending � December 31, 2011. The effect that GASB Statement No. 54 will have on the fiscal year 2011 basic financial statements has not been determined. � � � (35) � � � � � j � r � � � � � � � � � � � � CITY OF SCANOIA, MINNESOTA � NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2008 � NOTE 2 DEPOSITS AND INVESTMENTS ` A. DEPOSITS The City maintains a cash and investment pool that is available for use by all funds. � Each fund type's portion of this pool is displayed on the statement of net assets and the balance sheet as "Cash and Investments." In accordance with Minnesota Statutes the City maintains deposits at financial institutions which are authorized by the City Council. � Custodial Credit Risk— Custodial credit risk for deposits is the risk that in the event of a bank failure, the City's deposits may not be returned to it. The City does not have a � deposit policy for custodial credit risk and follows Minnesota Statutes for deposits. Minnesota Statutes require that all 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 corporate surety bonds. Authorized collateral include: U.S. government treasury bills, notes, or bonds; issues of a U.S. government agency; general obligations of a state or local government rated "A" or better; revenue obligations of a state or local government rated "AA" or better; irrevocable standby � letter of credit issued by a Federal Home Loan Bank; and time deposits insured by a federal agency. Minnesota Statutes require securities pledged as collateral be held in safekeeping in a restricted account at the Federal Reserve Bank or in an account at a � trust department of a commercial bank or other financial institution not owned or controlled by the depository. � The carrying value and bank balance of the City's deposits in banks at December 31, 2008 is $1,428,874 and $1,470,171, respectively, and were entirely covered by federal depository insurance or by surety bonds and collateral in accordance with Minnesota � Statutes. NOTE 3 CAPITAL ASSETS � Capital asset activity for the year ended December 31, 2008 was as follows: � Beginning Ending Balance Increases Decreases Balance Governmental Activities: Land $ 702,500 $ 12,950 $ - $ 715,450 � Construction in Progress 1,464,379 - 1,464,379 - Buildings 1,966,800 1,966,800 Equipment 398,649 398,649 Vehicles 612,845 - - 612,845 ' Infrastructure - 1,464,379 = 1,464,379 Furniture and Fi�ures 372,362 372,362 Miscellaneous Assets 419,438 - - 419,438 Governmental Activities Capital Assets 5,936,973 1,477,329 1,464,379 5,949,923 � Business-Type Activities: Sewer: Plant $ 1,500,000 $ - $ - $ 1,500,000 � Less:Accumulated Depreciation 540,000 30,000 - 570,000 Net Capital Assets-Sewer Utility 960,000 $ (30,000) $ 930,000 � �36> � � � � � � � � � � � � � � � � i i 1 ' CITY OF SCANDIA MINNESOTA , NOTES TO BASIC FINANCIAL STATEMENTS ' DECEMBER 31, 2008 ' NOTE 4 CITY INDEBTEDNESS � City indebtedness at December 31, 2008 is composed of the following: Final ' Issue Maturity Interest Original Balance Date Date Rate Issue 12/31/08 Governmental Activities: General Obligation Bonds ' 2004 Improvement Bonds 6/15/2004 8/1/2009 2.05-3.3% $ 1,200,000 $ 240,000 2005 Building Crossover Bonds 5/1/2005 12/1/2015 3.35-4.2% 685,000 685,000 2007 Improvement Bonds 5/1/2007 12/1/2017 3.65-4.1% 1,430,000 1,180,000 Total Long-Term Debt 3,315,000 2,105,000 ' Unamortized Bond Discount (43,090) (36,043) Severances Payable N!A 15,700 Total 3,271,910 2,084,657 ' The following is a schedule of changes in City indebtedness for the year ended December 31, 2008: � Amounts Balance Balance Due Within 1/1/08 Issued Retired 12/31/08 One Year Long-Term Debt ' Govemmental Activities: General Obligation Notes $3,565,000 $ $(1,460,000) $ 2,105,000 $ 460,000 Unamortized Bond Discount (31,616) (11,474) 7,047 (36,043) - Severance Payable 19,031 20,658 (23,989) 15,700 11,728 � Total Long-Term Debt $3,552,415 $ 9,184 $(1,476,942) $ 2,084,657 $ 471,728 All long-term bonded indebtedness outstanding at December 31, 2008 is backed by the full ' faith and credit of the City, including special assessment bond issues. For the governmental activities, compensated absences are generally liquidated by the general fund. ' During 2005, the City issued $685,000 of General Obligation Building Crossover Refunding Bonds, Series 2005A for the purpose of refunding the $1,200,000 General Obligation ' Building Bonds of 2000. The crossover refunding occurred on December 1, 2008. Future debt service payments will be reduced by $24,214 with a present value savings of$18,886. Minimum annual principal and interest payments required to retire long-term debt, not ' including compensated absences payable are as follows: Year Endinq December 31, Principal Interest Total ' 2009 $ 460,000 $ 80,098 $ 540,098 2010 225,000 64,336 289,336 2011 230,000 56,123 286,123 2012 235,000 47,525 282,525 ' 2013 235,000 38,494 273,494 2014-2017 720,000 64,434 784,434 Total 2,105,000 351,010 2,456,010 ' ' (37) 1 ' t � , 1 1 , � 1 � , ' , � ' ' , ' ' CITY OF SCANDIA MINNESOTA � ' NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2008 , NOTE 4 CITY INDEBTEDNESS (CONTINUED) ' Description and Restrictions of Lonq-Term Debt ' General Obligation Bonds — The bonds were issued for improvements or projects which benefited the City as a whole and are, therefore, repaid from ad valorem levies. The liability for compensated absences represents vested benefits earned by governmental ' fund employees through the end of the year which will be paid or used in future periods. , NOTE 5 DEFINED BENEFIT PENSION PLANS —STATEWIDE A. PLAN DESCRIPTION ' All full-time and certain part-time employees of the City are covered by defined benefit pension plans administered by the Public Employees Retirement Association of ' Minnesota (PERA). PERA administers the Public Employees Retirement Fund (PERF) which is a cost-sharing, multiple-employer retirement plan. This plan is established and administered in accordance with Minnesota Statutes, Chapter 353 and 356. , PERF 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. ' Two methods are used to compute benefits for PERA's Coordinated and Basic Plan members. The retiring member receives the higher of step-rate benefit accrual formula ' (Method 1) or a level accrual formula (Method 2). Under Method 1, the annuity accrual rate for a Basic Plan member is 2.2% of average salary for each of the first 10 years of service and 2.7% for each remaining year. The annuity accrual rate for a Coordinated ' Plan member is 1.2% of average salary for each of the first 10 years and 1.7% for each remaining year. Under Method 2, the annuity accrual rate is 2.7% of average salary for Basic Plan members and 1.7% for Coordinated Plan members for each year of service. , For PERF members hired prior to July 1, 1989 whose annuity is calculated using Method 1, a full annuity is available when age plus years of service equal 90. Normal retirement age is 65 for Basic and Coordinated members hired prior to July 1, 1989. ' Normal retirement age is the age for unreduced Social Security benefits capped at 66 for Coordinated members hired on or after July 1, 1989. A reduced retirement annuity is also available to eligible members seeking early retirement. ' ' (38) � CITY OF SCANDIA MINNESOTA � NOTES TO BASIC FINANCIAL STATEMENTS ' DECEMBER 31, 2008 , NOTE 5 DEFINED BENEFIT PENSION PLANS —STATEWIDE (CONTINUED) ' A. PLAN DESCRIPTION (CONTINUED) ' There are different types of annuities available to members upon retirement. A single- life annuity is a lifetime annuity that ceases upon the death of the retiree, no survivor annuity is payable. There are also various types of joint and survivor annuity options available which will be payable over joint lives. Members may also leave their ' contributions in the fund upon termination of public service in order to qualify for a deferred annuity at retirement age. Refunds of contributions are available at any time to members who leave public service, but before retirement benefits begin. , 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 PERF. That report may be obtained on the internet at www.mnpera.org, by writing to PERA at 60 Empire Drive #200, 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. PERF Basic Plan members and Coordinated Plan members are required to contribute 9.1% and 6.0% respectively, of their annual covered salary in 2008. The City is required to contribute the following percentages of annual covered ' payroll: 11.78% for Basic Plan PERF members, and 6.5% for Coordinated Plan PERF members. Employer contribution rates for the Coordinated Plan will increase to 6.75% effectively January 1, 2009. The City's contributions to the Public Employees ' Retirement Fund for the years ended December 31, 2008, 2007, and 2006 were $21,087, $14,426, and $13,000, respectively. The City's contributions were equal to the contractually required contributions for each year as set by state statute. ' , ' ' � (39) � ' ' , , , ' 1 � ' ' ' ' ' , ' , ' � � CITY OF SCANDIA MINNESOTA � NOTES TO BASIC FINANCIAL STATEMENTS , DECEMBER 31, 2008 , NOTE 6 DEFINED CONTRIBUTION PENSION PLAN ' The 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. , Plan benefits depend solely on amounts contributed to the plan plus investment earnings, less ad�inistrative expenses. Minnesota Statutes, Chapter 353D.03, specifies the employee and employer contribution rates for those qualified personnel who elect to ' participate. An eligible elected official who decides to participate contributes 5% 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% of employer contributions and twenty-five hundredths of one percent of the assets in each member's account annually. ' Total employer and employee contributions made by the City during fiscal year 2008 were $2,550. ' NOTE 7 COMMITMENTS AND CONTINGENCIES ' Fire Services — The City has entered into an agreement with the Capitol City Regional Firefighter's Association whereby the Association will provide the City with fire services. The contract remains in force until either party withdraws. Related expenditures for fiscal ' year 2008 were $279,344. Law Enforcement Services — The City has entered into an agreement with Washington � County to provide law enforcement services for 2008. The agreement calls for the City to pay Washington County based on the actual costs associated with providing services under the agreement. Related expenditures for fiscal year 2008 were $106,321. Law � enforcement services for 2009 are estimated to cost approximately $117,000. Fire Department Services Aqreement — Effective January 1, 2009, the City has entered into ' an agreement with May Township to provide fire services to the Township. The contract is for three years extending through December 31, 2011. If the contract is not renewed or extended by December 31, 2011, the contract will continue on a prorated month-to-month ' basis. The Town shall pay the City $29,266, $30,876, and $32,574 for 2009, 2010, and 2011, respectively. ' ' � (40) � CITY OF SCANDIA MINNESOTA , , NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2008 , NOTE 8 DESIGNATIONS AND RESERVATIONS OF FUND BALANCE ' At December 31, 2008, the City had designated and reserved portions of its various fund balance through legal restriction and City Council authorization. Major fund balance � appropriations at December 31, 2008 are shown on the various balance sheets as segregations of the fund balance. A summary of such designations and reservations are as follows: ' Designations Reserved for For Capital Debt Service Improvements , Major Funds: - 2004 Improvement Bond $ 166,646 $ 2007 Improvement Debt Service 50,907 - � 2000 Fire Hall Bond 167,567 - Capital Improvement 212,140 Nonmajor Funds: ' Park Capital Improvement _ 35,579 Equipment Replacement 50,017 Total Governmental Fund Balances at December 31, 2008 $ 385,120 $ 297,736 � A deficit undesi nated fund balance of $19 925 exists in the sanctua ca ital r � 9 ry p p o�ects fund. The deficit is expected to be eliminated by special assessment revenues in future ' periods. � NOTE 9 INTERFUND RECEIVABLE AND PAYABLE Individual fund receivable and payable balances at December 31, 2008 are as follows: � Interfund Interfund Receivable Payable 1 Governmental Activity: - General Fund $ 19,925 $ Nonmajor Fund -Sanctuary - 19,925 � 19,925 19,925 Interfund receivable and payable balances represent the elimination of negative cash , between funds, and are expected to be repaid in the next fiscal year. ' , � (41) � , ' , i I 1 1 ! � i 1 � t � 1 1 i � ' CITY OF SCANDIA MINNESOTA � ' NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2008 � NOTE 10 INTERFUND TRANSFERS ' Individual fund transfers for fiscal year 2008 are as follows: � Transfer Transfer In Out Governmental Activity: General Fund $ 302,397 $ 40,000 � Road and Bridge = 173,618 Fire Fund 18,809 Police - 3,551 , 2002 Improvement Bond = 151,334 2004 Improvement Bond 665,000 2007 Capital Improvement - 61,062 ' Park = 57,799 Community Center 5,309 Water Shed - 15,890 2000 Fire Hall Bond 665,000 - ' 2007 Improvement Bond 212,396 = Equipment Replacement 40,000 Uptown Sewer - 24,082 � Sewer - 3,339 1,219,793 1,219,793 ' During 2008, the City made routine interfund transfers to allocate financial resources to the funds that received benefit from services provided by another fund or to establish or close- out funds. � NOTE 11 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. � The City has entered into a joint powers agreement with the League of Minnesota Cities Insurance Trust (LMCIT) to protect the City in the event of a loss. The LMCIT is a public entity risk pool currently operating as a common risk management and insurance program � for Minnesota cities. The agreement for formation of the LMCIT provides that the pool will be self-sustaining through member premiums and will reinsure through commercial companies for claims in excess of reserved amounts for each insured event. The pool can � make additional assessments to make the pool self—sustaining. The City has determined that it is not possible to estimate the amount of such additional � assessments, if any; however, they are not expected to be material to these financial statements. There have been no significant reductions in insurance coverage during 2008 and settlements have not exceeded insurance coverage for any of the past three fiscal � years. � (42) ' � � , ' ' ' , 1 � 1 i 1 1 1 � i 1 ! � , � i 1 � REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON INFORMATION ' i 1 1 � � 1 1 ! i 1 i 1 ' ' � i 1 1 ! i i 1 ! 1 i 1 ! i 1 i t � CiTY OF SCANDIA IN , M NESOTA � SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL GENERALFUND � YEAR ENDED DECEMBER 31, 2008 ' _ Budgeted Amounts Actual Variance with ' Original Final Amounts Final Budget REVENUES Property Tax $ 1,368,339 $ 1,368,339 $ 1,301,526 $ (66,813) ' Intergovernmental: State Aid Credits 45,000 45,000 54,036 9,036 Recycling Grant - 7,000 7,000 7,223 223 Other Grants 7,500 7,500 2,000 (5,500) � Total Intergovernmental Revenues 59,500 59,500 63,259 3,759 Licenses and Permits 86,190 86,190 66,132 (20,058) Fines and Forfeits 9,000 9,000 15,953 6,953 iCharges for Services: Zoning and Hearing Fees 91,325 91,325 124,090 32,765 Fire Protection 22,162 22,162 22,162 - � Cable Franchise 6,000 6,000 5,618 (382) Total Charges for Services 119,487 119,487 151,870 32,383 Miscellaneous: � Interest 10,591 10,591 3,885 (6,706) Donations and Other 6,360 6,360 44,395 38,035 Total Miscellaneous 16,951 16,951 48,280 31,329 � Total Revenues 1,659,467 1,659,467 1,647,020 (12,447) EXPENDITURES General Government: ' Administration and Finance 342,762 342,762 316,365 (26,397) City Council 18,713 18,713 18,188 (525) Elections 5,770 5,770 5,521 (249) , Planning and Building 169,736 169,736 212,527 42,791 Total General Government 536,981 536,981 552,601 15,620 Public Safety: � Police 101,883 101,883 106,321 4,438 Fire 263,881 267,291 279,344 12,053 Total Public Safety 365,764 369,174 385,665 16,491 , � � , � (43) ' CITY OF SCANDIA MINNESOTA � SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE � BUDGET AND ACTUAL (CONTINUED) GENERALFUND YEAR ENDED DECEMBER 31, 2008 � ' Budgeted Amounts Actual Variance with Original Final Amounts Final Budget � EXPENDITURES (CONTINUED) Public Works: Public Works $ 574,049 $ 579,359 $ 345,583 $ (233,776) ' Uptown Sewer 3,330 3,330 14,878 11,548 Total Public Works 577,379 582,689 360,461 (222,228) Parks and Recreation: � Parks 44,567 44,567 33,411 (11,156) Community Center 52,926 52,926 52,922 (4) Total Parks and Recreation 97,493 97,493 86,333 (11,160) � Debt Service: Principal Payments 20,630 20,630 20,000 (630) � Interest Payments 590 590 590 - Total Debt Service 21,220 21,220 20,590 (630) Total Expenditures 1,598,837 1,607,557 1,405,650 (201,907) � OTHER FINANCING SOURCES (USES) Transfers In 4,739 4,739 302,397 297,658 � Transfers Out (40,000) (40,000) (40,000) - Total Other Financing Sources (Uses) (35,261) (35,261) 262,397 297,658 NET CHANGE IN FUND BALANCE $ 25,369 $ 16,649 503,767 $ 487,118 � Fund Balance- Beginning of Year 19,682 ' FUND BALANCE -END OF YEAR $ 523,449 � � ' � � � (44) , , � i 1 1 t 1 ! � ! 1 1 t 1 1 1 1 � � CITY OF SCANDIA, MINNESOTA NOTES TO REQUIRED SUPPLEMENTARY INFORMATION � YEAR ENDED DECEMBER 31, 2008 , STEWARDSHIP COMPLIANCE AND ACCOUNTABILITY - BUDGETS � The General Fund budget is legally adopted on a basis consistent with U.S. generally accepted accounting principles. Actual expenditures exceeded budgets during 2008 as follows: � Final Budget Actual Excess General Fund � General Government: Planning and Building $ 169,736 $ 212,527 $ (42,791) � Public Safety: Police 101,883 106,321 (4,438) Fire 267,291 279,344 (12,053) � Public Works: Uptown Sewer 3,330 14,878 (11,548) � r � f � � � � i 1 � (45)