2015 City of Hopkins, MN Annual ReportCity of Hopkins, Minnesota
Comprehensive Annual Financial Report
for year ended December 31, 2015
15
COMPREHENSIVE ANNUAL
FINANCIAL REPORT
of the
CITY OF HOPKINS, MN
For The Year Ended
December 31, 2015
Prepared by the Department of Finance
I
Page
Letter of Transmittal from the City Manager and Finance Director 3
Certificate of Achievement for Excellence in Financial Reporting 9
Administrative Organization Chart 10
City Officials 11
II
Independent Auditors' Report 13
Management's Discussion and Analysis 16
A. Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Position 31
Statement of Activities 32
Fund Financial Statements:
Balance Sheet - Governmental Funds 33
Reconciliation of the Balance Sheet of Governmental Funds
to the Statement of Net Position 35
Statement of Revenues, Expenditures and Changes in
Fund Balances - Governmental Funds 36
Reconciliation of the Statement of Revenues, Expenditures
and Changes in Fund Balances of Governmental Funds
to the Statement of Activities 38
Statement of Revenues, Expenditures and Changes in
Fund Balances - Budget and Actual - General Fund 39
Statement of Revenues, Expenditures and Changes in
Fund Balances - Budget and Actual - Economic
Development Special Revenue Fund 40
Statement of Revenues, Expenditures and Changes in
Fund Balances - Budget and Actual - Arts Center
Special Revenue Fund 41
Statement of Revenues, Expenditures and Changes in
Fund Balances - Budget and Actual - Tax Increment
District Super Valu Special Revenue Fund 42
Statement of Net Position - Proprietary Funds 43
Statement of Revenues, Expenses and Changes in
Net Position - Proprietary Funds 45
Statement of Cash Flows - Proprietary Funds 46
Notes to Financial Statements 48
INTRODUCTORY SECTION
FINANCIAL SECTION
TABLE OF CONTENTS
YEAR ENDED DECEMBER 31, 2015
COMPREHENSIVE ANNUAL FINANCIAL REPORT
THE CITY OF HOPKINS, MINNESOTA
i
Page
B. Required Supplementary Information
Schedule of Funding Progress - Other Postemployment Benefit Plan 85
Schedules of Proportionate Share of Net Pension Liability 85
Schedule of the City's Contribution to the Hopkins Fire Relief Fund 86
Schedule of Proportionate Share of Net Pension Liability -
Hopkins Fire Relief 88
C. Combining and Individual Nonmajor Fund Statements and Schedules:
Combining Balance Sheet - Nonmajor Governmental Funds 91
Combining Statement of Revenues, Expenditures and Changes
in Fund Balances - Nonmajor Governmental Funds 100
Schedules of Revenues, Expenditures, and Changes in Fund
Balances - Budget and Actual:
Special Revenue Funds:
State Chemical Assessment 109
Real Estate Purchases & Sales 110
Parking 111
Communications 112
Depot Coffee House 113
Tax Increment District Entertainment Center 114
Tax Increment District Sonoma Project 115
Tax Increment District Oaks of Mainstreet 116
5th Avenue Flats 117
Tax Increment District Marketplace & Main 118
Combining Statement of Net Position - Nonmajor Enterprise Funds 120
Combining Statement of Revenues, Expenses and Changes in
Net Position - Nonmajor Enterprise Funds 121
Combining Statement of Cash Flows - Nonmajor Enterprise Funds 122
Combining Statement of Net Position - Internal Service Funds 124
Combining Statement of Revenues, Expenses and Changes in
Net Position - Internal Service Funds 125
Combining Statement of Cash Flows - Internal Service Funds 126
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED DECEMBER 31, 2015
THE CITY OF HOPKINS, MINNESOTA
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III
Page
A. Financial Trends
Net Position by Component 138
Changes in Net Position 140
Fund Balances, Governmental Funds 142
Changes in Fund Balances, Governmental Funds 144
B. Revenue Capacity
Assessed and Actual Value of Taxable Property 146
Direct and Overlapping Property Tax Rates 147
Principal Property Taxpayers 148
Property Tax Levies and Collections 149
C. Debt Capacity
Ratios of Outstanding Debt by Type 150
Ratios of Net General Bonded Debt Outstanding 151
Direct and Overlapping Governmental Activities Debt 152
Legal Debt Margin Information 153
Pledged-Revenue Coverage 154
D. Demographic and Economic Information
Demographic and Economic Statistics 155
Principal Employers 156
E. Operating Information
Full-time Equivalent City Employees by Type 157
Operating Indicators by Function/Program 158
Capital Asset Statistics by Function/Program 160
STATISTICAL SECTION
THE CITY OF HOPKINS, MINNESOTA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED DECEMBER 31, 2015
iii
CITY OF HOPKINS, MINNESOTA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED DECEMBER 31, 2015
SECTION I
INTRODUCTORY SECTION
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August 1, 2016
To the Honorable Mayor, Members of the Hopkins City Council and the Citizens of the
City of Hopkins, Minnesota:
The Comprehensive Annual Financial Report (CAFR) of the City of Hopkins, Minnesota (the
City) for the fiscal year ended December 31, 2015 is hereby submitted. This report was prepared
in accordance with U.S. generally accepted accounting principles (GAAP) as established by the
Governmental Accounting Standards Board (GASB) and meets the requirements of the
Minnesota State Auditor’s Office.
This report consists of management’s representations concerning the finances of the City of
Hopkins. Consequently, management assumes full responsibility for both the completeness and
reliability of all of the information presented in this report. To provide a reasonable basis for
making these representations, management of the City of Hopkins has established a
comprehensive internal control framework that is designed both to protect the government’s
assets from loss, theft, or misuse and to compile sufficient reliable information for the
preparation of the City of Hopkins financial statements in conformity with GAAP. Because the
cost of internal controls should not outweigh their benefits, the City of Hopkins comprehensive
framework of internal controls has been designed to provide reasonable rather than absolute
assurance that the financial statements will be free from material misstatement. As management,
we assert that, to the best of our knowledge and belief, this financial report is complete and
reliable in all material respects.
The City of Hopkins financial statements have been audited by CliftonLarsonAllen LLP, a firm
of licensed certified public accountants. The goal of the independent audit was to provide
reasonable assurance that the financial statements of the City of Hopkins for the fiscal
year ended December 31, 2015, are free of material misstatement. The independent audit
involved examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements; assessing the accounting principles used and significant estimates made by
management; and evaluating the overall financial statement presentation. The independent
auditor concluded based upon the audit, that there was a reasonable basis for rendering
unmodified opinions that the City of Hopkins financial statements for the fiscal year ended
December 31, 2015, are fairly presented in conformity with GAAP. The independent auditors’
report is presented as the first component of the financial section of this report.
GAAP requires that management provide a narrative introduction, overview, and analysis to
accompany the basic financial statements in the form of Management’s Discussion and Analysis
(MD&A). This letter of transmittal is designed to complement the MD&A and should be read in
conjunction with it. The City’s MD&A can be found in the financial section of this report
immediately following the report of the independent auditors.
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Profile of the Government
Hopkins was first settled in 1853 and was incorporated as the Village of West Minneapolis in
1893. The name was changed in 1928 to Hopkins after one of the early residents. The original
territory of incorporation was three square miles, but successive annexation since 1946 has
enlarged this area by one-third. In 1947, the residents of the area adopted a City Charter with a
Council/Manager form of government. The governing council is responsible, among other
things, for passing ordinances, adopting the budget, appointing committees and hiring the
government’s manager and the government’s attorney. The government’s manager is
responsible for carrying out the policies and ordinances of the government, for overseeing day-
to-day operations of the government and for appointing the heads of the government’s
departments.
The report includes all funds of the City, including the City’s Housing and Redevelopment
Authority (HRA). The City provides a full range of services including general government,
public safety, highways and streets, urban redevelopment and housing, culture and recreation,
and health and welfare. In addition to general municipal activities, the City provides water,
sewer, storm sewer and refuse services and operates an ice arena. Low-income rental housing is
a function of the HRA. The Hopkins Fire Relief Association has not met the established criteria
for inclusion in the reporting entity, and accordingly is excluded from this report.
The annual budget serves as the foundation for the City of Hopkins financial planning and
control. All departments of the City of Hopkins are required to submit requests for appropriation
to the Finance Director by July of each year. The Finance Director uses these requests as the
starting point for developing a proposed budget. The Finance Director then presents this
proposed budget to the Council for review prior to September 30th. The Council is required to
hold public hearings on the proposed budget and to adopt a final budget no later than December
31, the close of the City of Hopkins fiscal year.
The appropriated budget is prepared by fund and department. Department heads may make
transfers of appropriations within a department. Transfers of appropriations between funds
require approval of the City Council. Budget to actual comparisons are provided in this report
for each individual governmental fund for which an annual budget has been adopted. For the
General Fund and the major Special Revenue Funds this comparison is presented on pages 39-42
as part of the basic financial statements for the governmental funds. For governmental funds,
other than the General fund and major Special Revenue Funds, with annual budgets, this
comparison is presented in the combining and individual fund statements and schedules
subsection of this report on pages 109-126.
Factors Affecting Financial Condition
The City of Hopkins, consisting of 2,504 acres, is located in Hennepin County on the westerly
fringe of the Minneapolis urban area. The City, as part of the Minneapolis-St. Paul metropolitan
complex, is readily accessible by the many highways and railways leading into the area. This
easy access prompted steady growth for the City of Hopkins during its formative years. In
response to this growth the City developed goals of working towards a planned community, with
its policies directed toward sound ratios of residential, commercial and industrial components,
with the current tax base approximately 76% single family residential and apartments, and 24%
commercial-industrial. The city’s population has stabilized due to the fact that the City is largely
developed and the national trend toward the lowering of persons per household.
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The City Council and staff along with an organized group of concerned partners determined what
the Vision and the Mission of the City of Hopkins should be. Participation in this project was
very high and the resulting Vision and Mission are as follows:
Community Vision
Creating a Spirit of Unity – Hopkins will be a community where
People are treated with respect
People participate in building culture, character and common bonds
Business growth throughout the City is supported while maintaining a vibrant City center
People feel safe, support outstanding schools and celebrate cultural heritages
People enjoy quality public services, parks and housing
City of Hopkins Mission
Inspire, Educate, Involve, Communicate
Economic Condition and Outlook
Hopkins continues to show strong economic and redevelopment activities within the city. The
valuation of new non-residential construction in 2015 was $12.6 million dollars. This
development activity has been the result of a good development market in the Hopkins area
along with successful planning on the part of the city council and city staff.
Significant projects completed or begun in 2015 include the following:
Activity Valuation
Commercial Additions/Alterations:
Super Valu – test kitchens $ 1,300,000
Hopkin Honda – addition $ 1,423,500
Walser Jeep Chrysler – addition $ 1,600,000
Johnson Building redevelopment $53,000,000
Efforts are being made for continued development and growth for 2015 and beyond. It is
anticipated that approximately $149,000,000 of construction will also take place in the City of
Hopkins during the next several years.
Some anticipated projects for 2016-2019 include the following:
P r o j e c t V a l u a t i o n
Hopkins Cold Storage Site Redevelopment $62,000,000
EBCO Site redevelopment $10,000,000
Oxford Green Apartments $ 7,000,000
Metropolitan Council Lift Station $ 5,000,000
Hopkins Village Apartments remodel $ 4,400,000
Long-term financial planning
The City of Hopkins has a strategic plan for economic development and has completed extensive
planning work in anticipation of the Southwest Light Rail Transit (SWLRT) line and the three
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Hopkins LRT stations. As a part of the plans, the City of Hopkins intends to pursue various
development and redevelopment efforts throughout the City. Several projects are anticipated.
In 2015, projects completed were the Super Valu test kitchens, along with the Hopkins Honda
and Walser Jeep Chrysler additions. In addition the Johnson Building redevelopment was
started. This development by Doran Companies known as "The Moline" will be a 241-unit
market rate apartment building with state-of-the-art amenities along with retail on the first level.
The project is projected to be completed in the fall of 2017. These developments will have major
impacts on the community. Specialized planning is taking place to ensure that these
developments occur so as to benefit the community and residential neighborhoods.
Major improvements continue to be made along the Hopkins section of Excelsior Boulevard
(County Road 3). The first phase of improvements occurred in 1998 - 2000 between Shady Oak
Road and 9th Avenue South. The second phase occurred in 2002 – 2004 between Highway 169
and Blake Road. The third phase occurred in 2007 on the segment between Highway 169 and
8th Avenue. The final phase is the section from Blake Road to Meadowbrook Road, has
provisional county funding and is tentatively scheduled for 2016-2017.
Significant improvements for Shady Oak Road (County Road 61) began in 2013 and were
completed in 2015. This project is a joint effort between Hennepin County and the Cities of
Minnetonka and Hopkins. A number of neighborhood and town meetings were held to gather
input on this project that will re-align the road and facilitate re-development of the area. The
project began in earnest in 2013 with the acquisition of right of way property with major road
construction starting in 2014 and finishing in 2015.
Another project in the planning stages is the 14-mile Southwest Corridor Light Rail Transit
(SWLRT) line that will go from Eden Prairie to downtown Minneapolis passing through
Hopkins and providing development potential at three transit stations that are planned for
Hopkins. In downtown Minneapolis the Southwest LRT will connect with the Hiawatha and
Central LRT lines. Construction of the light rail line is expected to begin in 2017 and is
expected to be funded with the Counties Transit Improvement Board’s transit sales tax in the
metro area (30%), and with Hennepin County Regional Railroad Authority (10%), Federal
(50%), and State (10%) dollars.
Relevant Financial Policies
The City of Hopkins has adopted a comprehensive set of financial policies. While no new
policies were developed in 2015 staff continues to review current policies to ensure they remain
relevant.
In addition the City of Hopkins’ Fund Balance policy requires that the General Fund’s
Unassigned portion of fund balance be equivalent to a minimum of five months expenditures or
42% of the prior fiscal year General Fund operating expenses. At December 31, 2015 the
General Fund unassigned fund balance is at 48.01% or $5,439,799 which represents slightly
more than five months expenditures of the 2015 budget. Due to sound fiscal policy and close
monitoring of budgets we remain at the targeted General Fund balance goal.
Major Initiatives
For 2015, the staff, following specific directives of the council and the city manager, has been
involved in a variety of projects throughout the year. These projects reflect the government’s
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commitment to ensuring that its citizens are able to live and work in a safe environment and that
the needs for services are met.
In 2015, we accomplished our annual street repair and improvements, at a cost of approximately
$4,900,359. This included the city's share of the Shady Oak Road project, along with
improvements to Mainstreet reconstruction. Along with the street improvements, improvements
to various parking lots totaled $1,093,118. In addition preliminary work was begun on the 2016
street improvement project.
We continue to improve Cottageville Park and invested $2,146,978 in that park in 2015 adding
play equipment and continuing to expand the park. Additional park project improvements for
2015 totaled $50,182.
The water, sewer and storm sewer departments also completed in conjunction with the street
improvements, infrastructure reconstruction projects totaling $911,825 along with several other
small projects.
Other miscellaneous improvement projects in 2015 included the purchase of a downtown
building for $142,053 with the intention of moving the Hopkins Historical Society out of another
city building into one more visible to the public that will offer them more space for their
collections, running fiber optic cable to various city buildings at a cost of $215,002 which will
improve communication between city facilities, and various other city park improvements at a
total cost of $50,182. Preliminary work has also begun on the Public Works garage upgrade with
the majority of the work to be completed in 2016 at an estimated cost of $746,500.
Future projects
A systematic citywide sidewalk rehab program was initiated in 1992. Each year one quadrant is
inspected and necessary repairs made. A sidewalk/trail plan was developed and implemented in
2003, which guides future improvements and connections to regional trails.
The City has established a street reconstruction and storm sewer program based on a street
condition survey and storm water management program. The streets found in poor condition and
future problem streets will be systematically included for repairs in the five-year Capital
Improvement Plan.
Certificate of Achievement For
Excellence in Financial Reporting
The Government Finance Officers Association of the United States and Canada (GFOA)
awarded a Certificate of Achievement for Excellence in Financial reporting to the City of
Hopkins for its comprehensive annual finance report for the fiscal year ended December 31,
2014. In order to be awarded a Certificate of Achievement for Excellence in Financial
Reporting, a governmental unit must publish an easily readable and efficiently organized
comprehensive annual financial report. This report must satisfy both U.S. generally accepted
accounting principles and applicable legal requirements.
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A Certificate of Achievement is valid for a period of one year only. We believe our current
comprehensive annual financial report continues to meet the Certificate of Achievement
Program’s requirements and we are submitting it to the GFOA to determine its eligibility for
another certificate.
Acknowledgments
We wish to express our appreciation to the Mayor and City Council for their continued interest
and support in planning and conducting the financial operations of the City in a responsible and
progressive manner. We also want to express our appreciation to the Finance Department staff
for their work in preparing this report.
Respectfully submitted,
Michael J. Mornson Christine M. Harkess, CPA, CGFM
City Manager Finance Director
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Organizational Chart
CITIZENS
City Manager
CITY
COUNCIL
Community
Services Finance Fire
Police
Planning &
Economic
Development
Recreation
Public Works
City of
Minnetonka
Assessing
City Clerk
Communications
Information
Services
Inspections
Reception
Activity Center
Accounting
Payroll
Utility Billing
Economic
Development
Housing
Planning &
Zoning
Public Housing
Fire & Medical
Response
Prevention
Emergency
Preparedness
Patrol
Investigation
Communication
Crime
Prevention
Building Maint. &
Equipment Services
Engineering
Parks & Forestry
Street/Traffic/Refuse
Water & Sewer
Pavilion/Ice Arena
Boards &
Commissions City Attorney
Administrative
Services
Center for the
Arts
Depot Coffee
House
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THE CITY OF HOPKINS, MINNESOTA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
CITY OFFICIALS
December 31, 2015
CITY COUNCIL
Term
Expires
Molly Cummings Mayor 12-31-17
Katy Campbell Councilmember 12-31-17
Jason Gadd Councilmember 12-31-19
Kristi Halverson Councilmember 12-31-17
Aaron Kuznia Councilmember 12-31-19
CITY MANAGER
Michael J. Mornson Appointed
DIRECTOR OF FINANCE
Christine M. Harkess Appointed
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CITY OF HOPKINS, MINNESOTA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED DECEMBER 31, 2015
SECTION II
FINANCIAL SECTION
12
An independent member of Nexia International
INDEPENDENT AUDITORS' REPORT
Honorable Mayor and
Members of the City Council
City of Hopkins, Minnesota
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business-
type activities, each major fund, and the aggregate remaining fund information of the City of Hopkins
(the City), as of and for the year ended December 31, 2015, and the related notes to the financial
statements, which collectively comprise the City’s basic financial statements as listed in the table of
contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditors’ Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We
conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on the auditors’ judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation and fair presentation of the financial statements in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluating the overall presentation of the
financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
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Honorable Mayor and
Members of the City Council
City of Hopkins
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business-type activities, each major
fund, and the aggregate remaining fund information of the City as of December 31, 2015, and the
respective changes in financial position and, where applicable, cash flows thereof and the respective
budgetary comparison for the General Fund and major special revenue funds for the year then ended in
accordance with accounting principles generally accepted in the United States of America.
Emphasis of a Matter
During the year ended December 31, 2015, the City adopted the provisions of Governmental
Accounting Standards Board Statement (GASB) No. 68, Accounting and Financial Reporting for
Pensions and the related GASB Statement No. 71, Pension Transition for Contributions Made
Subsequent to the Measurement Date—an amendment of GASB Statement No. 68. As a result of the
implementation of these standards, the City reported a restatement for the change in accounting
principle (see Note 16). Our auditors’ opinion was not modified with respect to the restatement.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
management’s discussion and analysis, schedule of funding progress – other postemployment benefits
plan, schedules of the City’s proportionate share of net pension liabilities and schedules of pension
contributions and the schedule of funding progress, as listed in the table of contents, be presented to
supplement the basic financial statements. Such information, although not a part of the basic financial
statements, is required by the Governmental Accounting Standards Board who considers it to be an
essential part of financial reporting for placing the basic financial statements in an appropriate
operational, economic, or historical context. We have applied certain limited procedures to the required
supplementary information in accordance with auditing standards generally accepted in the United
States of America, which consisted of inquiries of management about the methods of preparing the
information and comparing the information for consistency with management’s responses to our
inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic
financial statements. We do not express an opinion or provide any assurance on the information
because the limited procedures do not provide us with sufficient evidence to express an opinion or
provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the City’s basic financial statements. The introductory section, combining and
individual nonmajor fund statements and schedules and statistical section are presented for purposes
of additional analysis and are not a required part of the basic financial statements.
The combining and individual nonmajor fund statements and schedules are the responsibility of
management and were derived from and relate directly to the underlying accounting and other records
used to prepare the basic financial statements. Such information has been subjected to the auditing
procedures applied in the audit of the basic financial statements and certain additional procedures,
including comparing and reconciling such information directly to the underlying accounting and other
records used to prepare the basic financial statements or to the basic financial statements themselves,
and other additional procedures in accordance with auditing standards generally accepted in the United
States of America. In our opinion, the combining and individual fund statements and schedules are
fairly stated, in all material respects, in relation to the basic financial statements as a whole.
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Honorable Mayor and
Members of the City Council
City of Hopkins
Other Matters (Continued)
Other Information (Continued)
The introductory and statistical sections have not been subjected to the auditing procedures applied in
the audit of the basic financial statements and, accordingly, we do not express an opinion or provide
any assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated August 1,
2016, on our consideration of the City's internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts, and grant agreements and other
matters. The purpose of that report is to describe the scope of our testing of internal control over
financial reporting and compliance and the result of that testing, and not to provide an opinion on
internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the City’s internal control
over financial reporting and compliance.
CliftonLarsonAllen LLP
Minneapolis, Minnesota
August 1, 2016
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CITY OF HOPKINS, MINNESOTA
MANAGEMENT’S DISCUSSION AND ANALYSIS
(Unaudited)
This section of the City’s comprehensive annual financial report presents a discussion and analysis of
the City’s financial activities during the fiscal year ended December 31, 2015. This discussion and
analysis should be read in conjunction with the letter of transmittal in the introductory section of this
report.
Financial Highlights
The assets and deferred outflows of the City exceeded liabilities and deferred inflows at the
close of the 2015 fiscal year by approximately $62.5 million (net position). Of this amount,
approximately $8.03 million (unrestricted net deficit) is unavailable to meet the City’s ongoing
obligations to citizens and creditors due in part to the recognition of the City's share of the
unfunded pension obligation.
The net position of the government-wide financial statements was negatively impacted in the
current year by $6.0 million due to the required implementation of GASB Statement No. 68,
Accounting and Financial Report for Pensions, a new accounting standard. This is more fully
described on page 20. Net Position was also negatively impacted by approximately $1.7
million due to the payment of refunding debt that was called February 1, 2015.
As of the close of the current fiscal year, the City's governmental funds reported combined
ending fund balances of approximately $26.9 million, an increase of approximately $1.8 million
in comparison with the prior year. The increase was primarily due to sale of refunding bonds
late in the year that will be used to refund debt in February 2016. Approximately $5.1 million
of fund balance is available for spending at the City’s discretion (assigned or unassigned fund
balance).
As of December 31, 2015, unassigned fund balance for the General Fund was approximately
$5.4 million, or 48% of total general fund expenditures. This compares to $5.1 million from the
prior year, an increase of approximately $255,000. The General Fund working capital goal
policy stated that the City will strive to maintain a fund balance in the General Fund for
working capital of 42% of the previous year's General Fund expenditures. At December 31st
working capital is at 48%.
The City of Hopkins total debt increased by approximately $9.5 million during the current
fiscal year due to the sale of improvement, tax abatement and refunding bonds for four bond
issues. Total new debt totaled $18.7 million and bond maturities totaled $9.2 million.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the City of Hopkins basic
financial statements. The City of Hopkins basic financial statements comprise three components: 1)
government-wide financial statements, 2) fund financial statements, and 3) notes to the financial
statements. This report also contains other supplementary information in addition to the basic financial
statements themselves.
Government-wide financial statements. The government-wide financial statements are designed to
provide readers with a broad overview of the City of Hopkins finances, in a manner similar to a private-
sector business.
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The statement of net position presents information on all of the City of Hopkins assets, deferred
outflows of resources, liabilities, and deferred inflows of resources with the difference between them
reported as net position. Over time, increases or decreases in net position may serve as a useful
indicator of whether the financial position of the City of Hopkins is improving or deteriorating.
The statement of activities presents information showing how the City net position changed during the
most recent fiscal year. All changes in net position are reported as soon as the underlying event giving
rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses
are reported in this statement for some items that will only result in cash flows in future fiscal periods
(e.g., uncollected taxes and earned but unused vacation leave).
Both of the government-wide financial statements distinguish functions of the City of Hopkins that are
principally supported by taxes and intergovernmental revenues (governmental activities) from other
functions that are intended to recover all or a significant portion of their costs through user fees and
charges (business-type activities). The governmental activities of the City of Hopkins include general,
public safety, highways, streets, culture, recreation, urban redevelopment, housing, health and welfare.
The business-type activities of the City of Hopkins include water, sewer, refuse, storm sewer utilities,
an ice arena, and a housing and redevelopment authority.
The government-wide financial statements include the City of Hopkins itself, but also a legally separate
Hopkins Housing and Redevelopment Authority. Although the Hopkins Housing and Redevelopment
Authority is legally separate, it functions for all practical purposes as a department of the City of
Hopkins, and therefore has been included as an integral part of the primary government.
The government-wide financial statements can be found on pages 28-29 of this report.
Fund financial statements. A fund is a grouping of related accounts that is used to maintain control
over resources that have been segregated for specific activities or objectives. The City of Hopkins, like
other state and local governments, uses fund accounting to ensure and demonstrate compliance with
finance-related legal requirements. All of the funds of the City of Hopkins can be divided into two
categories: governmental funds and proprietary funds.
Governmental funds. Governmental funds are used to account for essentially the same functions
reported as governmental activities in the government-wide financial statements. However, unlike the
government-wide financial statements, governmental fund financial statements focus on near-term
inflows of spendable resources, as well as on balances of spendable resources available at the end of the
fiscal year. Such information may be useful in evaluating a City’s near-term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial
statements, it is useful to compare the information presented for governmental funds with similar
information presented for governmental activities in the government-wide financial statements. By
doing so, readers may better understand the long-term impact of the City’s near-term financing
decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues,
expenditures, and changes in fund balance provide a reconciliation to facilitate this comparison between
governmental funds and governmental activities.
The City of Hopkins maintains thirty-seven individual governmental funds. Information is presented
separately in the governmental fund balance sheet and in the governmental fund statement of revenues,
17
expenditures, and changes in fund balances for the General Fund, Economic Development, Arts Center,
Tax Increment District Super Valu, 2009B Housing Improvement Bonds of 1999B Refunding Bonds,
2015D GO TI Revenue Bonds, and Permanent Improvement Revolving fund all of which are
considered to be major funds. Data from the other thirty-two funds are combined into a single,
aggregated presentation. Individual fund data for each of these non-major governmental funds is
provided in the form of combining statements elsewhere in this report.
The City of Hopkins adopts an annual appropriated budget for its general fund and all of its special
revenue funds except for the Community Development Block Grant fund. A budgetary comparison
statement has been provided for the General fund and major special revenue funds and schedules are
provided for other funds to demonstrate compliance with the budget.
The basic governmental fund financial statements can be found on pages 30-39 of this report.
Proprietary funds. The City of Hopkins maintains two types of proprietary funds. Enterprise funds
are used to report the same functions presented as business-type activities in the government-wide
financial statements. The City of Hopkins uses enterprise funds to account for its water, sewer, refuse,
storm sewer utilities, the pavilion ice arena, and the housing and redevelopment authority. Internal
service funds are an accounting device used to accumulate and allocate costs internally among the City
of Hopkins various functions. The City of Hopkins uses internal service funds to account for
replacement of equipment, insurance deductibles and compensated absences. Because all of these
services predominantly benefit governmental rather than business-type functions, they have been
included within governmental activities in the government-wide financial statements.
Proprietary funds provide the same type of information as the government-wide financial statements,
only in more detail. The proprietary fund financial statements provide separate information for the
water, sewer, storm sewer utility funds, all of which are considered to be major funds of the City of
Hopkins. Data from the other three enterprise funds are combined into a single, aggregated
presentation. Individual fund data for each of these non-major proprietary funds is provided in the form
of combining statements elsewhere in this report. The internal service funds are combined into a single,
aggregated presentation in the proprietary fund financial statements. Individual fund data for the
internal service funds is also provided in the form of combining statements elsewhere in this report.
The basic proprietary fund financial statements can be found on pages 40-44 of this report.
Notes to the Financial Statements
The notes provide additional information that is essential to a full understanding of the data provided in
the government-wide and fund financial statements. The notes to the financial statements can be found
on pages 46-69 of this report.
Other Information
In addition to the basic financial statements and accompanying notes, this report also presents certain
required supplementary information. Required supplementary information can be found on page 71 of
this report.
The combining statements referred to earlier in connection with non-major governmental funds, non-
major proprietary funds and internal service funds are presented immediately following the required
18
supplementary information. Combining and individual fund statements and schedules can be found on
pages 74-108 of this report.
Government-Wide Financial Analysis
As noted earlier, net position may serve over time as a useful indicator of a government’s financial
position. In the case of the City of Hopkins, assets exceeded liabilities by $62,490,991 at the close of
the most recent fiscal year.
Slightly over two thirds (75%) of the City of Hopkins net position is reflected in its investment in
capital assets (e.g., land, buildings, machinery and equipment); less any related debt used to acquire
those assets that are still outstanding. The City of Hopkins uses these capital assets to provide services
to citizens. The net capital assets are not available for future spending. Although the City of Hopkins
investment in its capital assets is reported net of related debt, it should be noted that the resources
needed to repay this debt must be provided from other sources.
City of Hopkins Net Position
December 31
Governmental Activities Business-Type Activities Total
2015 2014 2015 2014 2015 2014
Assets
Current and other assets $ 35,661,380 $ 35,773,666 $ 2,611,965 $ 2,682,760 $ 38,273,345 $ 38,456,426
Capital assets 57,145,566 49,314,501 22,701,488 22,425,930 79,847,054 71,740,431
Total assets 92,806,946 85,088,167 25,313,453 25,108,690 118,120,399 110,196,857
Deferred Outflows of Resources
Deferred charges on refunding 309,483 312,743 - - 309,483 312,743
Pensions 1,355,974 - 113,826 - 1,469,800 -
Total deferred outflows of
resources 1,665,457 312,743 113,826 - 1,779,283 312,743
Liabilities
Other liabilities 2,916,998 4,731,255 262,178 517,572 3,179,176 5,248,827
Long-term liabilities
outstanding 47,533,793 30,527,243 5,769,591 5,698,978 53,303,384 36,226,221
Total liabilities 50,450,791 35,258,498 6,031,769 6,216,550 56,482,560 41,475,048
Deferred Inflows of Resources
Pensions 843,495 - 82,636 - 926,131 -
Net Position
Net investment in capital assets 32,609,356 31,272,253 17,893,856 16,937,928 50,503,212 48,210,181
Restricted 20,016,574 16,967,889 - - 20,016,574 16,967,889
Unrestricted (9,447,813) 1,902,270 1,419,018 1,954,212 (8,028,795) 3,856,482
Total net position $ 43,178,117 $ 50,142,412 $ 19,312,874 $ 18,892,140 $ 62,490,991 $ 69,034,552
A portion of the City of Hopkins net position represent resources that are subject to external restrictions
on how they may be used. The remaining balance of unrestricted net deficit ($8,028,795) was
negatively impacted by the implementation of GASB Statement No. 68, more fully described below.
At the end of the current fiscal year, the City of Hopkins is able to report positive balances in all two
categories of net position, for its governmental activities and in all three categories for the business-type
activities. The City’s net position decreased by $593,191 during the current fiscal year.
The City adopted new accounting guidance, GASB Statement No. 68, Accounting and Financial
Reporting for Pensions - an Amendment of GASB Statement No. 27 and the related GASB Statement
19
No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date - an
amendment of GASB Statement No. 68 for the year ended December 31, 2015. Essentially, the standard
required the unfunded portion of defined benefit pension plans to be reported by all participating
employers. Recording the net pension liability and the pension related deferred outflows and inflows of
resources do not change the City's future funding requirements or obligations under the plans, which are
determined by state statutes. Additionally, the standard required the net pension asset of the Hopkins
Fire Department Relief Association to be recorded in the government-wide financial statements for the
first time.
The statement of net position was impacted by $6,131,406 at December 31, 2015 due to the
implementation of this standard. Pension-related amounts included in the above schedule related to the
standard are as follows:
Net pension asset $ 688,067
Deferred outflows of resources 1,469,800
Net pension liability (7,363,142)
Deferred inflows of resources (926,131)
Total $ (6,131,406)
(remainder of this page left blank intentionally)
20
Governmental and business-type activities. Governmental activities decreased the City of Hopkins
net position by $1,795,485 and business-type activities increased net position by $1,202,294. Key
elements of the increases are as follows:
City of Hopkins Changes in Net Position
For the Year Ended December 31
Governmental Activities Business-Type Activities Total
2015 2014 2015 2014 2015 2014
Revenues:
Program revenues:
Charges for services $ 1,367,196 $ 1,069,080 $ 5,705,338 $ 5,521,545 $ 7,072,534 $ 6,590,625
Operating grants and
contributions 4,970,313 2,943,889 622,332 795,199 5,592,645 3,739,088
Capital grants and
contributions 501,029 2,728,416 - - 501,029 2,728,416
General revenues:
Property taxes 11,038,746 11,207,914 64,161 - 11,102,907 11,207,914
Tax increments 2,920,681 2,700,110 - - 2,920,681 2,700,110
Grants and contributions
not restricted 20,510 20,510 - - 20,510 20,510
Investment earnings 279,418 193,546 23,477 24,503 302,895 218,049
Gain on sale of capital
assets 27,535 27,235 - - 27,535 27,235
Total revenues 21,125,428 20,890,700 6,415,308 6,341,247 27,540,736 27,231,947
Expenses:
General government 13,016,991 2,276,155 - - 13,016,991 2,276,155
Public safety 6,665,974 6,526,230 - - 6,665,974 6,526,230
Health and welfare 185,248 171,187 - - 185,248 171,187
Highways and streets 4,542,014 5,709,009 - - 4,542,014 5,709,009
Urban redevelopment and
housing 1,249,457 2,247,553 - - 1,249,457 2,247,553
Culture and recreation 2,068,887 1,941,912 - - 2,068,887 1,941,912
Interest on long-term debt 688,155 711,697 - - 688,155 711,697
Water - - 1,699,540 1,540,940 1,699,540 1,540,940
Sewer - - 2,061,180 2,042,106 2,061,180 2,042,106
Storm sewer - - 394,707 508,686 394,707 508,686
Refuse - - 848,685 834,113 848,685 834,113
Pavilion/ice arena - - 462,771 460,246 462,771 460,246
Housing and
redevelopment authority - - 610,318 625,667 610,318 625,667
Total expenses 28,416,726 19,583,743 6,077,201 6,011,758 34,493,927 25,595,501
Increase in net position before
transfers
(7,291,298) 1,306,957 338,107 329,489 (6,953,191) 1,636,446
Transfers (864,187) 493,093 864,187 (493,093) - -
Increase in net position (8,155,485) 1,800,050 1,202,294 (163,604) (6,953,191) 1,636,446
Net position - January 1, as
previously reported 50,142,412 50,255,758 18,892,140 19,090,595 69,034,552 69,346,353
Prior period adjustment (5,168,810) (1,790,073) (781,560) - (5,950,370) (1,790,073)
Cumulative effect of change in
accounting principle - (123,323) - (34,851) - (158,174)
Net position - January 1, as
restated 44,973,602 48,342,362 18,110,580 19,055,744 63,084,182 67,398,106
Net position - December 31 36,818,117 50,142,412 19,312,874 18,892,140 56,130,991 69,034,552
21
Governmental activities: Property taxes decreased in 2015 as a result of tax appeals filed with the
County resulting in taxes being refunded to the appellants. The City also received a number of program
grants for specific programs in addition to state municipal aid for a major street improvement project.
Net position decreased primarily due to payment of refunding debt that was sold the previous year and
called in February 2015.
22
Business-type activities. Business-type activities had a increase in net position due to transfers and
greater than expected revenues. A utility master plan was developed in 2007 with scheduled rate
increases that are designed to cover operations, debt and capital needs over the next 15 years. As a
result the utility funds are in a stronger financial position than they were a couple years ago.
23
Financial Analysis of the City’s Funds
As noted earlier, the City of Hopkins uses fund accounting to ensure and demonstrate compliance with
finance-related legal requirements.
Governmental funds. The focus of the City of Hopkins 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 Hopkins financing requirements. In particular, unassigned fund balance may serve
as a useful measure of a City’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 Hopkins governmental funds reported combined
ending fund balances of $26,898,710, a increase of $1,771,219 in comparison with the prior year. The
key factor of the increase is the sale of refunding bonds that will be used to liquidate the 2007 HRA
Revenue Bonds in February 2016.
Approximately 19% of fund balance or $5,068,309, constitutes assigned and unassigned fund balance,
which is available for spending at the City’s discretion. The remainder of fund balance is non-
spendable, restricted or committed to indicate that it is not available for new spending because it is
either in a non-spendable form (inventory, prepaid expenses, rehabilitative loans, or property held for
resale); restricted (debt service, tax increment projects) or has already been committed (for economic
development, property purchases, parking, and communication activities).
The general fund is the chief operating fund of the City of Hopkins. At the end of the current fiscal
year, unassigned fund balance of the general fund was $5,439,799. This represents 90.6% of the general
fund’s total fund balance. As a measure of the general fund’s liquidity, it may be useful to compare
both unassigned fund balance and total fund balance to total fund expenditures. Unassigned fund
balance represents approximately 48.1% of total general fund expenditures while total fund balance
represents approximately 53.1% of that same amount.
The fund balance of the City of Hopkins general fund increased by $270,465 during the current fiscal
year. Revenues exceeded expenditures by $280,465 before transfers. This increase was a result of
conservative spending an increase in building permit revenues and public safety program grants for
specific programs.
The Economic Development fund has a total fund balance of $4,385,982 of which $4,285,982 is
committed for economic development. The fund balance increased by $263,936 primarily as a result of
an increase in the tax levy and conservative spending.
The Arts Center fund has a deficit fund balance of ($1,182,956) of which $68 is nonspendable and
($1,183,024) is unassigned. The fund balance deficit increased by $11,045. While the Arts Center
received a programming grant from the Minnesota State Arts Board to offset programming costs those
costs still exceeded budgeted revenues due to higher performing artist fees and expenses . Staff and the
Friends of the Hopkins Center for the Arts, a non-profit associated with the Arts Center, continue
working to identify significant donors and corporate sponsors to underwrite arts programming and
decrease the deficit.
The Tax Increment District Super Valu fund has a total fund balance of $3,511,730 of which all is
restricted for tax increment. The fund balance increased by $1,908,187 due to revenues exceeding
amounts owed to developers for project costs and related financing.
24
The 2009B Housing Improvement refunding bonds of 1999B bond fund has a total fund balance of
$694,722, all of which is restricted for the payment of debt service. The fund balance increased by
$51,915 as special assessment revenues exceeded current debt payment requirements.
The 2015D GO TI Refunding bond fund has a total fund balance of $7,454,556 all of which is restricted
for the payment of debt service. The fund balance increased by $7,454,556 as refunding bonds were
sold in December 2015 to call the 2007 HRA Revenue bonds in February 2016.
The Permanent Improvement Revolving fund has a total fund balance of $442,413 which is assigned for
construction projects. The fund balance decreased by $(2,342,904) a result of project costs expended
from prior year revenues. Revenues in this fund are derived from special assessments and taxes.
Proprietary funds. The City of Hopkins proprietary funds provide the same type of information found
in the government-wide financial statements, but in more detail.
Unrestricted net position of the Water fund at the end of the year amounted to ($440,506). The
decrease in net position amounted to $213,225 and is due to transfers in from the permanent
improvement fund for reimbursement of project costs. The City is in the process of a utility rate study
which is evaluating the entire rate structure of the water fund. The City is looking at implementing a
tiered rate structure that will meet state requirements for conservation pricing and meet the City's needs
for operations and capital expenditures. The new rates are anticipated to go into effect in mid-2016.
Unrestricted net position of the Sewer fund at the end of the year amounted to $245,576. The
unrestricted net position will be used to pay for infrastructure improvements. The increase in net
position amounted to $305,222 and is due to operating revenues exceeding operating expenses along
with transfers in from the permanent improvement fund for reimbursement of project costs.. Along
with the water fund a utility rate study is also being done for the sewer fund. A rate structure will be
put in place to ensure adequate funds are maintained for operations and capital needs in the long-term.
Unrestricted net position of the Storm Sewer Utility fund at the end of the year amounted to $720,310.
The unrestricted net position will be used to pay for infrastructure improvements. The increase in net
position amounted to $720,492 and is due to transfers in from the permanent improvement fund for
reimbursement of project costs.
General Fund Budgetary Highlights
The difference between the general fund original budget and the final amended budget resulted in
departmental budget changes but did not increase the total expenditure budget when transfers out are
included. The reason for the inter-departmental amendments was a transfer between expenditure
categories to match actual expenditures and a transfer from the contingency fund for health insurance
increases following bargaining unit negotiations which were outstanding when the year began.. The
budget changes can be summarized as follows:
Several departments had small budget modifications, however when departments were
combined for reporting purposes the budget changes balanced out and no change was noted.
During the year revenues were over budgetary estimates by $252,229 due to increases in license and
permit revenue, fines, federal grants, recreation fees and donations. This was offset by a decrease in tax
revenues as a result of rebates due taxpayers who challenged their valuations in tax court and less than
expected miscellaneous revenues.
25
Expenditures were under budget by $18,236 and was due to decreased costs in the public works
department primarily in the engineering and snow removal divisions. Due to the large amount of
projects in 2015 a greater portion of the engineering budget was charged back to the various
improvement projects and due to lower snowfalls less supplies were needed in the snow removal
budget.
The net effect of these budget impacts was an increase in fund balance of $270,465 after transfers.
Capital Asset and Debt Administration
Capital assets. The City of Hopkins investment in capital assets for its governmental and business type
activities as of December 31, 2015, amounts to $79,847,054 (net of accumulated depreciation). This
investment in capital assets includes land, buildings, improvements, vehicles, machinery and
equipment, park facilities, roads, highways, bridges, distribution systems and construction in progress.
Major capital asset events during the current fiscal year included the following:
Construction in progress additions totaled $9,297,915 for infrastructure projects and
enhancements to an undeveloped city park.
A total of $6,264,060 of assets was transferred from construction in progress to other
improvements as infrastructure projects were completed and put into service.
Vehicle and equipment purchases totaled $1,376,523. Major purchases included public works
equipment, public safety vehicles and equipment.
Vehicle and equipment deletions totaled $261,576. Deletions were a result of scheduled
replacements of public works, public safety vehicles and equipment.
City of Hopkins Capital Assets
(net of depreciation)
December 31
Governmental Activities Business-Type Activities Total
2015 2014 2015 2014 2015 2014
Land $ 6,157,677 $ 6,157,677 $ 254,299 $ 254,299 $ 6,411,976 $ 6,411,976
Buildings 13,588,144 13,838,575 3,284,952 3,412,915 16,873,096 17,251,490
Infrastructure - - 6,930,852 7,332,186 6,930,852 7,332,186
Improvements 24,710,194 22,167,426 10,005,964 7,999,437 34,716,158 30,166,863
Vehicles 1,840,710 1,869,078 467,459 260,750 2,308,169 2,129,828
Equipment 2,430,725 1,384,675 308,583 381,005 2,739,308 1,765,680
Construction in progress 8,418,116 3,897,070 1,449,379 2,785,338 9,867,495 6,682,408
$ 57,145,566 $ 49,314,501 $ 22,701,488 $ 22,425,930 $ 79,847,054 $ 71,740,431
Additional information on the City of Hopkins capital assets can be found in note 5 on pages 57-58 of
this report.
Long-term debt. At the end of the current fiscal year, the City of Hopkins had total bonded debt
outstanding of $44,010,000. Of this amount $13,105,000 comprises tax increment redevelopment debt,
and $24,060,000 comprises general obligation and special assessment debt, all of which is backed by
the full faith and credit of the government. Another $2,100,000 is special fees debt for which the
government is liable in the event of default by the property owners subject to the fees. The remainder
of the City of Hopkins debt, $4,745,000, represents bonds secured solely by specified revenue sources
(i.e., revenue bonds).
26
City of Hopkins Outstanding Debt
General Obligation and Revenue Bonds
December 31
Governmental Activities Business-Type Activities Total
2015 2014 2015 2014 2015 2014
G.O. Tax increment bonds $ 13,105,000 $ 1,650,000 $ - $ - $ 13,105,000 $ 1,650,000
G.O. Housing fee bonds 2,100,000 2,470,000 - - 2,100,000 2,470,000
G.O. Equipment certificates 585,000 665,000 - - 585,000 665,000
G.O. Capital improvement bonds 14,815,000 14,300,000 - - 14,815,000 14,300,000
G.O. Special assessment bonds 8,660,000 10,015,000 - - 8,660,000 10,015,000
Revenue bonds - - 4,745,000 5,420,000 4,745,000 5,420,000
$ 39,265,000 $ 29,100,000 $ 4,745,000 $ 5,420,000 $ 44,010,000 $ 34,520,000
The City of Hopkins total bonded debt increased by $9,490,000 during the current fiscal year. The
increase is a result of the issuance of $4,100,000 in G.O. Street Reconstruction Bonds that financed
street improvements on Mainstreet, the issuance of $2,940,000 on GO Tax Abatement Bonds for
various park and parking lot improvements and the issuance of $4,340,000 in GO TI refunding bonds to
refund the 2008 HRA Revenue Bonds that were called in December 2105 and $7,355,000 on GO TI
refunding bonds to refund the 2007 HRA Revenue bonds that will be called February 12, 2016.
General Obligation Bonds are backed by the full faith, credit and taxing power of the City, and are
serviced by General and Tax Increment levies and also by fees assessed against benefited properties.
Revenue Bonds are backed by the full faith, credit and taxing power of the City, and are serviced by the
Water, Sewer, and Storm Sewer Utility Funds and the Pavilion Fund current revenues.
City Special Assessment Bonds are backed by the full faith, credit and taxing power of the City, and
repayment monies are generated by the collection of special assessments and general levies.
The City is subject to a statutory limit of bonded indebtedness equaling 3.0 percent of taxable market
value. At December 31, 2015, the debt limit for the City is $48,167,756. Of the total debt, $15,400,000
of general obligation and revenue bonds is applicable to the limit. The legal debt margin is
$32,767,756.
The City of Hopkins was upgraded to a “AA+” rating from Standard & Poor’s in January 2014 which
was reaffirmed in November 2015 and maintains an “A1” rating from Moody’s.
Additional information on the City of Hopkins long-term debt can be found in note 9 on pages 60-63 of
this report.
Economic Factors and Next Year’s Budgets and Rates
A number of factors were taken into consideration when preparing the City of Hopkins 2016 budget. A
utility rate study was begun to look at the rates for the water and sewer funds to better position those
funds for the future. The tax capacity rate increased as a result of economic conditions. Property
values are starting to increase and this was taken into consideration when determining estimated tax
revenues. Also taken into consideration is that the City’s population would remain constant. As a
result of these factors the City prepared a budget for 2016 that included an overall increase of 4.66% in
expenditures.
27
During the current fiscal year, unassigned fund balance in the general fund increased to $5,439,799 or
48% of general fund expenditures. The Office of the State Auditor recommends unassigned fund
balances no less than five months of operating expenditures. The City is meeting the recommendation
for the general fund. The unassigned fund balance is used to pay for the City’s general fund obligations
until it receives its property tax levy revenues in June.
Requests for Information
This financial report is designed to provide a general overview of the City of Hopkins finances for all
those with an interest in the government’s finances. Questions concerning any of the information
provided in this report or requests for additional financial information should be addressed to the
Director of Finance, City of Hopkins, 1010 First Street South, Hopkins, MN 55343.
28
29
BASIC FINANCIAL STATEMENTS
30
City of Hopkins
Statement of Net Position
December 31, 2015
Primary Government
Governmental
Activities
Business-Type
Activities Total
Assets
Cash and cash equivalents $ 27,894,780 $ 2,327,668 $ 30,222,448
Taxes receivable 135,449 852 136,301
Special assessments receivable 3,743,368 -3,743,368
Accounts receivable 340,947 397,358 738,305
Intergovernmental receivable 1,273,224 19,596 1,292,820
Interest receivable 127,039 11,969 139,008
Internal balances 212,373 (212,373)-
Inventories 102,124 51,289 153,413
Net pension asset 688,067 -688,067
Prepaid items 125,192 15,606 140,798
Land held for resale 1,018,817 -1,018,817
Capital assets, non depreciable 14,575,793 1,703,678 16,279,471
Capital assets, net of depreciation 42,569,773 20,997,810 63,567,583
Total Assets 92,806,946 25,313,453 118,120,399
Deferred Outflows of Resources
Deferred charge on refunding 309,483 -309,483
Pensions 1,355,974 113,826 1,469,800
Total Deferred Outflows of Resources 1,665,457 113,826 1,779,283
Liabilities
Accounts payable 2,219,692 152,241 2,371,933
Salaries payable 144,620 14,037 158,657
Due to other governments 165,996 37,987 203,983
Accrued interest payable 326,617 50,721 377,338
Unearned revenue 60,073 7,192 67,265
Non current liabilities:
Compensated absences due within one year 805,664 81,712 887,376
Compensated absences due in more than one year -2,125 2,125
Net OPEB liability 144,904 33,734 178,638
Net pension liability due in more than one year 6,518,754 844,388 7,363,142
Capital lease due within one year 23,458 -23,458
Capital lease due in more than one year 126,158 -126,158
Bonds due within one year 3,075,000 380,000 3,455,000
Bonds due in more than one year 36,839,855 4,427,632 41,267,487
Total Liabilities 50,450,791 6,031,769 56,482,560
Deferred Inflows of Resources
Pensions 843,495 82,636 926,131
Total Deferred Inflows of Resources 843,495 82,636 926,131
Net Position
Net investment in capital assets 32,609,356 17,893,856 50,503,212
Restricted for:
Economic development 4,217,494 -4,217,494
Park improvements 258,547 -258,547
Debt service 15,540,533 - 15,540,533
Unrestricted (9,447,813)1,419,018 (8,028,795)
Total Net Position $43,178,117 $19,312,874 $62,490,991
The notes to the financial statements are an integral part of this statement.
31
City of Hopkins
Statement of Activities
For the Year Ended December 31, 2015
Program Revenues Net Revenues (Expenses) and Changes in Net Position
Functions/Programs Expenses
Charges for
Services
Operating Grants
and Contributions
Capital Grants and
Contributions
Governmental
Activities
Business-type
Activities Total
Governmental Activities:
General government $ 6,656,991 $82,686 $ 2,066,346 $326,672 $ (4,181,287) $- $ (4,181,287)
Public safety 6,665,974 79,415 1,095,916 - (5,490,643)- (5,490,643)
Health and welfare 185,248 47,085 112,448 -(25,715)-(25,715)
Highways and streets 4,542,014 127,221 1,212,575 174,357 (3,027,861)- (3,027,861)
Urban redevelopment and housing 1,249,457 220,027 197,827 -(831,603)-(831,603)
Culture and recreation 2,068,887 810,762 285,201 -(972,924)-(972,924)
Interest on long-term debt 688,155 ---(688,155)-(688,155)
Total Governmental Activities 22,056,726 1,367,196 4,970,313 501,029 (15,218,188)-(15,218,188)
Business-Type Activities:
Water 1,699,540 1,514,086 150 --(185,304)(185,304)
Sewer 2,061,180 2,172,277 150 --111,247 111,247
Storm sewer 394,707 805,542 ---410,835 410,835
Refuse 848,685 910,672 45,141 --107,128 107,128
Pavilion/Ice arena 462,771 24,876 373,356 --(64,539)(64,539)
Housing and redevelopment authority 610,318 277,885 203,535 --(128,898)(128,898)
Total Business-type Activities 6,077,201 5,705,338 622,332 --250,469 250,469
Total Government $28,133,927 $7,072,534 $5,592,645 $501,029 (15,218,188)250,469 (14,967,719)
General revenues:
Property taxes 11,038,746 64,161 11,102,907
Tax increments 2,920,681 -2,920,681
Grants & contributions not restricted 20,510 -20,510
Unrestricted investment earnings 279,418 23,477 302,895
Gain on disposal of capital assets 27,535 -27,535
Transfers (864,187)864,187 -
Total General Revenues 13,422,703 951,825 14,374,528
Change in net position (1,795,485)1,202,294 (593,191)
Net position - January 1, as previously reported 50,142,412 18,892,140 69,034,552
Prior period adjustment, as restated (see note 16)(5,168,810)(781,560) (5,950,370)
Net position - January 1 44,973,602 18,110,580 63,084,182
Net position - December 31 $ 43,178,117 $ 19,312,874 $ 62,490,991
The notes to the financial statements are an integral part of this statement.
32
City of Hopkins
Balance Sheet
Governmental Funds
December 31, 2015
General Fund
Economic
Development Arts Center
Tax Increment
District Super
Valu
Housing
Improvement
Bonds of 1999B
Refunding Bonds
of 2009B
Assets
Cash and cash equivalents $ 4,500,364 $ 2,739,026 $100 $ 3,180,866 $ 688,320
Taxes receivable 120,516 2,871 1,112 --
Special assessments receivable ----1,043,848
Accounts receivable 106,728 23,749 3,011 --
Rehabilitation loans receivable -----
Due from other governments 98,220 100,000 ---
Interest receivable 20,212 12,608 -11,189 3,020
Due from other funds 1,468,691 855,090 ---
Inventories 102,124 ----
Prepaid items 124,988 -68 --
Property held for resale -697,098 -321,719 -
Total Assets $6,541,843 $4,430,442 $4,291 $3,513,774 $1,735,188
Liabilities, Deferred Inflows of Resources and
Fund Balances
Liabilities:
Accounts payable $ 183,618 $ 36,996 $ 23,624 $ 2,044 $459
Salaries payable 130,549 2,461 4,476 --
Due to other funds --1,152,597 --
Due to other governments 97,334 2,132 3,620 --
Unearned revenue 2,726 -2,136 --
Total Liabilities 414,227 41,589 1,186,453 2,044 459
Deferred inflows of resources:
Taxes and special assessments 120,516 2,871 794 -1,040,007
Total Deferred Inflows of Resources 120,516 2,871 794 -1,040,007
Fund balances:
Non-spendable 227,112 -68 --
Restricted -100,000 -3,511,730 694,722
Committed -4,285,982 ---
Assigned 340,189 ----
Unassigned 5,439,799 - (1,183,024)--
Total Fund Balances (Deficits)6,007,100 4,385,982 (1,182,956)3,511,730 694,722
Total Liabilities, Deferred Inflows of
Resources and Fund Balances $6,541,843 $4,430,442 $4,291 $3,513,774 $1,735,188
The notes to the financial statments are an integral part of this statement.
33
City of Hopkins
Balance Sheet
Governmental Funds
December 31, 2015
2015D GO TI
Revenue Bonds
Permanent
Improvement
Revolving
Nonmajor
Governmental
Funds
Total
Governmental
Funds
Assets
Cash and cash equivalents $ 7,453,914 $ 1,731,489 $ 6,209,594 $ 26,503,673
Taxes receivable -196 10,754 135,449
Special assessments receivable -117,971 2,581,549 3,743,368
Accounts receivable -14,709 148,857 297,054
Rehabilitation loans receivable --43,893 43,893
Due from other governments -563,901 511,103 1,273,224
Interest receivable 642 10,510 61,011 119,192
Due from other funds ---2,323,781
Inventories ---102,124
Prepaid items --136 125,192
Property held for resale ---1,018,817
Total Assets $7,454,556 $2,438,776 $9,566,897 $35,685,767
Liabilities, Deferred Inflows of Resources and
Fund Balances
Liabilities:
Accounts payable $- $ 1,318,371 $ 133,648 $ 1,698,760
Salaries payable --7,134 144,620
Due to other funds --958,811 2,111,408
Due to other governments --62,910 165,996
Unearned revenue --55,211 60,073
Total Liabilities -1,318,371 1,217,714 4,180,857
Deferred inflows of resources:
Taxes and special assessments -677,992 2,764,020 4,606,200
Total Deferred Inflows of Resources -677,992 2,764,020 4,606,200
Fund balances:
Non-spendable --136 227,316
Restricted 7,454,556 -4,959,468 16,720,476
Committed --596,627 4,882,609
Assigned -442,413 806,826 1,589,428
Unassigned --(777,894) 3,478,881
Total Fund Balances (Deficits)7,454,556 442,413 5,585,163 26,898,710
Total Liabilities, Deferred Inflows of
Resources and Fund Balances $7,454,556 $2,438,776 $9,566,897 $35,685,767
The notes to the financial statments are an integral part of this statement.
34
City of Hopkins
Reconciliation of the Balance Sheet of Governmental Funds
To the Statement of Net Position
December 31, 2015
Fund balances of governmental funds $ 26,898,710
Amounts reported for governmental activities in the statement of net position
are different because:
Capital Assets used in governmental activities are not financial resources and,
therefore, not reported in the governmental funds.
Capital assets 78,746,219
Less accumulated depreciation (25,378,266)
Other long-term assets not available to pay current period expenditures and, therefore, are deferred in the
governmental funds.
4,606,200
Internal service funds are used by the City to charge the costs of
certain activities, such as replacement of City vehicles and equipment. The assets and
liabilities of the internal service funds are included in the governmental
activities in the statement of net position. 3,698,986
Long-term liabilities, including bonds payable and accrued interest payable, are
not due and payable in the current period and, therefore, are not reported in the
governmental funds.
Long-term liabilities (40,385,007)
Less deferred charges 309,483
Net pension liability and related deferred inflows of resources (7,362,249)
Long-term receivables are not due and payable in the current period and therefore,
are not reported in the governmental funds
Net pension asset and related deferred outflows of resources 2,044,041
Net position of governmental activities $ 43,178,117
35
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37
City of Hopkins
Reconciliation of the Statement of Revenues, Expenditures
and Changes in Fund Balances of Governmental Funds
to the Statement of Activities
For the Year Ended December 31, 2015
Net change in fund balances total governmental funds $ 1,771,219
Amounts reported for governmental activities in the statement of activities are different because:
Governmental funds report capital outlays as expenditures. However, in the
statement of activities the cost of those assets is allocated over their estimated useful
lives and reported as depreciation expense. This is the amount by which capital
outlays exceeded depreciation in the current period. 7,267,749
The net effect of various miscelleneous transactions involving capital assets
(i.e. sales, trade-ins, and donations) is a decrease to net assets (106,650)
Revenues in the statement of activities that do not provide current financial resources
are not reported as revenues in the funds 137,614
The issuance of long-term debt provides current financial resources to governmental funds,
while the repayment of the principal of long-term debt uses the current financial resources of
governmental funds. Neither transaction, however, has any effect on net position. Also,
governmental funds report the effect of premiums, discounts, and similar items when debt is
first issued, whereas these amounts are recorded in the statement of net position and amortized in
the statement of activities. This amount is the net effect of these differences in the treatment of
long-term debt related items. (10,600,303)
Some pension expenses reported in the Statement of Activities do not require the use of current
financial resources and, therefore are not reported as expenditures
Change in net pension asset/liability and related deferred outflows/inflows of resources (149,398)
External revenues and expenditures of the internal service funds reported in the statement of
activities are not reported as revenues and expenditures in governmental funds. (115,716)
Change in net position of governmental activities $ (1,795,485)
38
City of Hopkins
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
General Fund
For the Year Ended December 31, 2015
Original Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Property taxes $ 9,307,729 $ 9,307,729 $ 9,114,016 $ (193,713)
Intergovernmental 843,112 843,112 1,082,622 239,510
Fees, licenses and permits 390,375 390,375 489,373 98,998
Charges for services 209,300 209,300 285,136 75,836
Fines 179,600 179,600 242,146 62,546
Investment earnings 15,000 15,000 46,073 31,073
Other miscellaneous revenues 401,600 401,600 339,579 (62,021)
Total Revenues 11,346,716 11,346,716 11,598,945 252,229
Expenditures
General government 1,987,245 1,947,829 1,995,010 (47,181)
Public safety 5,988,107 6,010,049 6,095,484 (85,435)
Health and welfare 176,419 177,315 176,248 1,067
Highways and streets 2,464,436 2,478,380 2,339,648 138,732
Urban redevelopment and housing 91,449 92,145 92,328 (183)
Culture and recreation 589,560 591,498 614,140 (22,642)
Capital Outlay 39,500 39,500 5,622 33,878
Total Expenditures 11,336,716 11,336,716 11,318,480 18,236
Excess (deficiency) of revenues over
expenditures 10,000 10,000 280,465 270,465
Other Financing Sources (Uses):
Transfer out (10,000)(10,000)(10,000)-
Net change in fund blance $-$-270,465 $270,465
Fund balance - January 1 5,736,635
Fund balance - December 31 $ 6,007,100
The notes to the financial statements are an integral part of this statement.
39
City of Hopkins
Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Major Special Revenue Funds
Economic Development
Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Property taxes $ 272,572 $ 272,572 $ 439,265 $ 166,693
Intergovernmental --171,875 171,875
Investment earnings 4,000 4,000 46,374 42,374
Other miscellaneous revenues 11,500 11,500 69,789 58,289
Total Revenues 288,072 288,072 727,303 439,231
Expenditures
Current:
Urban redevelopment and housing 240,828 240,828 465,494 (224,666)
Total Expenditures 240,828 240,828 465,494 (224,666)
Other Financing Sources (Uses)
Transfer in --2,127 2,127
Net change in fund balance $47,244 $47,244 263,936 $216,692
Fund balance - January 1, reported 4,122,046
Fund balance - December 31 $ 4,385,982
The notes to the financial statements are an integral part of this statement.
40
City of Hopkins
Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Major Special Revenue Funds
Arts Center
Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Property taxes $ 85,000 $ 85,000 $ 83,905 $ (1,095)
Intergovernmental 58,000 58,000 37,337 (20,663)
Charges for services 383,901 383,901 369,452 (14,449)
Other miscellaneous revenues 173,300 173,300 203,109 29,809
Total Revenues 700,201 700,201 693,803 (6,398)
Expenditures
Current:
Culture and recreation 803,967 803,967 785,954 18,013
Capital Outlay 195,310 195,310 5,814 189,496
Total Expenditures 999,277 999,277 791,768 207,509
Other Financing Sources (Uses)
Transfer in 86,920 86,920 86,920 -
Net change in fund balance $(212,156)$(212,156)(11,045)$201,111
Fund balance - January 1, reported (1,171,911)
Fund balance - December 31 $ (1,182,956)
The notes to the financial statements are an integral part of this statement.
41
City of Hopkins
Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Major Special Revenue Funds
Tax Increment District Super Valu
Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Tax increments $ 2,400,000 $ 2,400,000 $ 2,597,340 $ 197,340
Investment earnings 3,000 3,000 40,744 37,744
Total Revenues 2,403,000 2,403,000 2,638,084 235,084
Expenditures
Urban redevelopment and housing 1,142,754 1,142,754 515,987 626,767
Total Expenditures 1,142,754 1,142,754 515,987 626,767
Other Financing Sources (Uses)
Transfer out (209,870) (209,870) (213,910)(4,040)
Net change in fund balance $1,050,376 $1,050,376 1,908,187 $857,811
Fund balance - January 1, reported 1,603,543
Fund balance - December 31 $ 3,511,730
The notes to the financial statements are an integral part of this statement.
42
City of Hopkins
Statement of Net Position
Proprietary Funds
December 31, 2015
Business-Type Activities-Enterprise Funds
Water
Utility
Sewer
Utility
Storm Sewer
Utility
Nonmajor
Proprietary
Funds Totals
Governmental
Activities
Internal
Service Funds
Assets
Current assets:
Cash and cash equivalents $- $ 257,527 $ 759,035 $ 1,311,106 $ 2,327,668 $ 1,391,107
Taxes receivable ---852 852 -
Accounts receivable 112,060 191,491 10,024 83,783 397,358 -
Accrued interest receivable 1,953 2,038 3,518 4,460 11,969 7,847
Due from other governments ---19,596 19,596 -
Inventory 29,333 21,913 43 -51,289 -
Prepaid expenses ---15,606 15,606 -
Total current assets 143,346 472,969 772,620 1,435,403 2,824,338 1,398,954
Noncurrent assets:
Capital Assets, non depreciable:
Land 14,097 5,150 26,800 208,252 254,299 -
Construction in progress 482,886 109,710 800,073 56,710 1,449,379 -
Capital Assets, depreciable
Building and structures 33,089 --8,096,525 8,129,614 -
Distribution system 11,733,042 8,362,098 10,979,692 125,614 31,200,446 -
Machinery and equipment 318,685 396,870 9,000 1,175,475 1,900,030 8,381,336
Less accumulated depreciation (6,326,723)(4,409,859)(3,999,430)(5,496,268)(20,232,280)(4,603,723)
Total noncurrent assets 6,255,076 4,463,969 7,816,135 4,166,308 22,701,488 3,777,613
Total Assets 6,398,422 4,936,938 8,588,755 5,601,711 25,525,826 5,176,567
Deferred outflows of resources:
Pensions 41,079 22,623 4,886 45,238 113,826 -
Total Deferred Outflows 41,079 22,623 4,886 45,238 113,826 -
Liabilities
Current liabilities:
Accounts payable 63,309 7,501 5,306 76,125 152,241 520,932
Salaries payable 4,110 2,938 538 6,451 14,037 -
Due to other funds 172,965 --39,408 212,373 -
Due to other governments 5,330 21,473 265 10,919 37,987 -
Compensated absences 15,714 9,903 -56,095 81,712 805,664
Unearned revenue ---6,583 6,583 -
Accrued interest payable 21,624 16,638 11,295 1,164 50,721 1,369
Capital lease - current -----23,458
Revenue bonds - current 145,000 105,000 110,000 20,000 380,000 -
Total current liabities 428,052 163,453 127,404 216,745 935,654 1,351,423
43
City of Hopkins
Statement of Net Position
Proprietary Funds
December 31, 2015
Business-Type Activities-Enterprise Funds
Water
Utility
Sewer
Utility
Storm Sewer
Utility
Nonmajor
Proprietary
Funds Totals
Governmental
Activities
Internal
Service Funds
Noncurrent liabilities:
Compensated absences $- $- $- $2,125 $2,125 $-
Net OPEB liability 7,320 7,320 -19,094 33,734 -
Net pension liability 304,736 167,819 36,245 335,588 844,388 -
Capital lease payable -----126,158
Revenue bonds payable (net of unamortized
discounts and premium)1,927,321 1,242,639 1,135,843 121,829 4,427,632 -
Toal noncurrent liabilities 2,239,377 1,417,778 1,172,088 478,636 5,307,879 126,158
Total Liabilities 2,667,429 1,581,231 1,299,492 695,381 6,243,533 1,477,581
Deferred inflows of resources:
Taxes and special assessments ---609 609 -
Pensions 29,823 16,424 3,547 32,842 82,636 -
Total Deferred Inflows of Resources 29,823 16,424 3,547 33,451 83,245 -
Net Position
Net investment in capital assets 4,182,755 3,116,330 6,570,292 4,024,479 17,893,856 3,627,997
Unrestricted (440,506)245,576 720,310 893,638 1,419,018 70,989
Total Net Position $3,742,249 $3,361,906 $7,290,602 $4,918,117 $19,312,874 $3,698,986
The notes to the financial statements are an integral part of this statement.
44
City of Hopkins
Statement of Revenues, Expenses and Changes in Net Position
Proprietary Funds
For the Year Ended December 31, 2015
Business-Type Activities-Enterprise Funds
Water
Utility
Sewer
Utility
Storm Sewer
Utility
Nonmajor
Proprietary
Funds Total
Governmental
Activities
Internal
Service Funds
Operating revenues
Charges for services $ 1,503,507 $ 2,156,439 $ 799,306 $ 1,564,685 $ 6,023,937 $ 450,129
Other 10,729 15,988 6,236 39,289 72,242 -
Total operating revenues 1,514,236 2,172,427 805,542 1,603,974 6,096,179 450,129
Operating expenses
Cost of sales and services 1,186,396 1,710,682 54,650 1,140,223 4,091,951 361,754
Administration 221,496 136,655 82,004 469,902 910,057 8,028
Depreciation 241,645 174,758 230,152 309,100 955,655 474,041
Total operating expenses 1,649,537 2,022,095 366,806 1,919,225 5,957,663 843,823
Operating income (loss)(135,301)150,332 438,736 (315,251)138,516 (393,694)
Nonoperating revenues (expenses)
Property taxes ---64,161 64,161 -
Investment earnings 2,555 2,271 8,148 10,503 23,477 21,873
Interest/fiscal agent expense (50,003)(39,085)(27,901)(2,549)(119,538)(8,550)
Intergovernmental grants ---231,491 231,491 237,120
Gain on sale of assets -----27,535
Total nonoperating revenues
(expenses)(47,448)(36,814)(19,753)303,606 199,591 277,978
Income (loss) before contributions and
transfers (182,749)113,518 418,983 (11,645)338,107 (115,716)
Transfers and contributions
Transfers in 496,274 297,004 605,843 -1,399,121 -
Transfers out (100,300)(105,300)(304,334)(25,000)(534,934)-
Change in net position 213,225 305,222 720,492 (36,645)1,202,294 (115,716)
Net position - January 1, as previously stated 3,811,086 3,212,016 6,603,658 5,265,380 18,892,140 3,814,702
Prior period adjustment, as restated (see note 16)(282,062)(155,332)(33,548)(310,618)(781,560)-
Net position - January 1 3,529,024 3,056,684 6,570,110 4,954,762 18,110,580 3,814,702
Net position - December 31 $3,742,249 $3,361,906 $7,290,602 $4,918,117 $19,312,874 $3,698,986
The notes to the financial statements are an integral part of this statement.
45
City of Hopkins
Statement of Cash Flows
Proprietary Funds
For the Year Ended December 31, 2015
Business-type Activities-Enterprise Funds
Governmental
Nonmajor Activities
Water Sewer Storm Sewer Proprietary Internal
Utility Utility Utility Funds Totals Service Funds
Cash Flows from Operating Activities
Receipts from customers and users $ 1,524,856 2,174,334 $ 804,879 $ 1,632,640 $ 6,136,709 $ 73,245
Receipts from interfund services provided - - - 1,414 1,414 376,884
Internal activity-payments from other funds - - - (36,398) (36,398)
Internal activity-payments to other funds 172,965 - 34,243 - 207,208 -
Payments to suppliers (798,002) (1,510,480) (97,408) (907,945) (3,313,835) 89,598
Payments to employees (245,666) (131,246) (34,753) (279,205) (690,870) -
Payments for interfund services used (221,496) (136,655) (82,004) (126,395) (566,550) (38,805)
Net cash provided by (used in) by operating activities 432,657 395,953 624,957 284,111 1,737,678 500,922
Cash Flows from Noncapital Financing Activities
Intergovernmental grants - - - 228,180 228,180 -
Taxes - - - 64,161 64,161 -
Transfers in (out) 395,974 191,704 301,509 (25,000) 864,187 -
Net cash provided by (used in) noncapital financing
activities 395,974 191,704 301,509 267,341 1,156,528 -
Cash Flows from Capital and Related Financing Activities:
Purchases of capital assets - - - (232,515) (232,515) (1,201,924)
Construction of capital assets (376,711) (106,250) - (44,963) (527,924) -
Proceeds from sales of capital assets - - - - - 27,535
Interest and other payments (56,955) (41,758) (35,186) (3,016) (136,915) (8,964)
Capital lease payments - - - - - (45,252)
Bond payments (320,000) (100,000) (235,000) (20,000) (675,000) -
Net cash provided by (used in) capital and related
financing activities (753,666) (248,008) (270,186) (300,494) (1,572,354) (1,228,605)
Cash Flows From Investing Activities
Interest received 1,842 863 6,284 8,224 17,213 18,193
Net increase (decrease) in cash and cash equivalents 76,807 340,512 662,564 259,182 1,339,065 (709,490)
Cash and cash equivalents - January 1 (76,807) (340,465) (662,427) 170,079 (909,620) 709,740
Cash and cash equivalents - December 31 $ - $ 47 $ 137 $ 429,261 $ 429,445 $ 250
46
City of Hopkins
Statement of Cash Flows
Proprietary Funds
For the Year Ended December 31, 2015
Business-type Activities-Enterprise Funds
Governmental
Nonmajor Activities
Water Sewer Storm Sewer Proprietary Internal
Utility Utility Utility Funds Totals Service Funds
Reconciliation of Cash and Cash Equivalents at End of Year to
Cash and Investments per Statement of Net Position
Ending cash and cash equivalents per cash flow statement $ - $ 47 $ 137 $ 429,261 $ 429,445 $ 250
Investments - 257,480 758,898 881,845 1,898,223 1,390,857
Cash and Investments per Statement of Net Position $ - $ 257,527 $ 759,035 $ 1,311,106 $ 2,327,668 $ 1,391,107
Reconciliation of operating income (loss) to net
cash provided (used) by operating activities:
Operating income (loss)$ (135,301) $ 150,332 $ 438,736 $ (315,251) $ 138,516 $ (392,859)
Adjustments to reconcile operating income
(loss) to net cash provided by (used in) operating
activities:
Depreciation expense 241,645 174,758 230,152 309,100 955,655 474,041
(Increase) decrease in:
Accounts receivable 10,620 1,907 (663) 30,391 42,255 -
Due from other funds - - 34,243 - 34,243 -
Inventory (16,182) (9,424) - 631 (24,975) -
Prepaid expense - - (43) 968 925 -
Pensions (deferred outflows) (41,079) (22,623) (22,623) (86,325)
Increase (decrease) in: (45,238) (45,238)
Accounts, compensated absences and accrued interest payable (138,620) (87,614) (94,902) (31,801) (352,937) 419,740
Due to other funds 172,965 - - (34,984) 137,981 -
Due to other governments 4,050 4,374 265 2,590 11,279 -
Unearned revenue - - - (1,725) (1,725)
Net Pension 304,736 167,819 36,245 336,588 845,388
Pensions (deferred inflows) 29,823 16,424 3,547 32,842 82,636 -
Net cash provided (used) by operating activities $ 432,657 $ 395,953 $ 624,957 $ 284,111 $ 1,737,678 $ 500,922
The notes to the financial statements are an integral part of this statement.
47
NOTES TO THE
FINANCIAL STATEMENTS
48
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS
December 31, 2015
1. SUMMARY OF SIGNIFICANT ACCOUNT POLICIES
The City of Hopkins, Minnesota (the City) is a charter City, which was approved December 2, 1947. The City
operates pursuant to applicable Minnesota laws and statutes. The governing body of the City is a Council – Manager
form of government.
The financial statements of the City have been prepared in conformity with U.S. generally accepted accounting
principles as applied to governmental units by the Government Accounting Standards Board (GASB). The more
significant accounting policies of the City are described below.
A. REPORTING ENTITY
In accordance with GASB pronouncements, the City’s financial statements include all funds and departments of
the City and its component units, for which the City is considered to be financially accountable. A blended
component unit, although legally separate entity is, in substance, part of the City’s operations and so data from this
unit is combined with data of the primary government. The City’s blended component unit has a March 31 year-
end, however when blended with the City it is shown with a December 31 year-end.
Blended Component Unit
Housing and Redevelopment Authority in and for the City of Hopkins (HRA)
The HRA was created by the City to carry out certain redevelopment projects and low-income rental housing. The
HRA's governing body is the same as the governing body of the primary government in that all members of the
Hopkins City Council are also the Hopkins Housing and Redevelopment Authority Commissioners. The City of
Hopkins in its capacity as the HRA Board of Directors, has operational responsibility for the HRA. Therefore
there is a burden relationship between the primary government and the component unit. The housing activity is
supported in part by federal subsidies. There is an extensive trust agreement between the HRA and HUD
regarding the facility. The HRA is included in the City’s enterprise funds. Separate financials are not prepared.
B. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS
The government-wide financial statements (i.e., statement of net position and the statement of changes in net
position) report information on all activities of the primary government and its component units. The interfund
services provided and used are not eliminated in the process of consolidation. 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 for support.
The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is
offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or
segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit
from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that
are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and
other items not properly included among program revenues are reported instead as general revenues.
Separate financial statements are provided for governmental funds and proprietary funds. Major individual
governmental funds and major individual enterprise funds are reported as separate columns in the fund financial
statements.
C. MEASUREMENT FOCUS, BASIS OF ACCOUNTING, AND FINANCIAL STATEMENT PRESENTATION
The government-wide financial statements are reported using the economic resources measurement focus and the
accrual basis of accounting, as are the proprietary fund financial statements. Revenues are recorded when earned
49
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
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 have been met. Unbilled utility service receivables are recorded at
year-end.
Governmental funds are accounted for using the current financial resources measurement focus and the modified
accrual basis of accounting. Their revenues are recognized when susceptible to accrual (i.e., when they become
measurable and available). “Measurable” means the amount of the transaction can be determined and “available”
means collectible within the current period or within sixty days thereafter to be used to pay liabilities of the current
period.
Major revenues that are susceptible to accrual include property taxes, special assessments, intergovernmental
revenues, charges for services, and investment earnings. Major revenues that are not susceptible to accrual include
fees and miscellaneous revenues; such revenues are recorded only as received because they are not measurable
until collected.
Expenditures are generally recognized under the modified accrual basis of accounting when the related fund
liability is incurred, except for principal and interest on general long-term debt and compensated absences that are
recognized when due and payable.
The City reports the following major governmental funds:
The general fund is the primary operating fund of the City. It is used to account for all financial resources
except those required to be accounted for in another fund.
The economic development special revenue fund accounts for development opportunities of the city. Sources
of funds are derived from the administration of loans and an annual tax levy.
The arts center special revenue fund accounts for the activities of the Hopkins Center for the Arts. Sources of
funds are derived from leases, ticket sales, admission fees, grants and donations.
The tax increment district super valu special revenue fund accounts for the activities of the Super Valu tax
increment development district. Sources of funds are a tax increment levy.
The 2009B taxable housing improvement bonds of 1999B refunding bond debt service fund accounts for
resources accumulated and payments made for principal and interest on long-term debt issued to pay for
Westbrook Patio Home improvements. The owners of these town homes pay an annual fee, which in turn pays
for the bond issue.
The 2015D general obligation tax increment revenue bonds debt service fund accounts for resources
accumulated and payments made for principal and interest on long-term debt issued for the Cargill
development project.
The permanent improvement revolving capital projects fund accounts for resources and accumulated payments
for street improvements funded with bonds and special assessments levied on benefited property.
The City reports the following major proprietary funds:
The water utility fund accounts for the operations of the City-owned water distribution system. The water
bonds of 2009A, 2012B and 2013A are included as part of this fund since revenues of the water fund are
pledged to pay principal and interest on this bond.
The sewer utility fund accounts for the operations of the City-owned sewer lift stations and disposal system.
The sewer bonds of 2009A, 2012B and 2013A are included as part of this fund since revenues of the sewer
fund are pledged to pay principal and interest on this bond.
50
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
The storm sewer utility fund accounts for the operations and improvements of the storm water drainage system.
The storm water bond issues of 2009A, 2010B, 2012B and 2013A are included as part of this fund since
revenues of the storm sewer fund are pledged to pay principal and interest on these bonds.
Additionally, the City reports the following fund types:
Governmental Funds
Special Revenue Funds - Special revenue funds are used to account for the proceeds of specific revenue
sources that are legally restricted or committed by Council to expenditures for specified purposes.
Debt Service Funds - Debt service funds are used to account for the accumulation of resources for, and the
payment of, general long-term debt principal, interest, and related costs.
Capital Project Funds - Capital project funds are used to account for financial resources to be used for the
acquisition or construction of major capital facilities and infrastructure, other than those financed by
proprietary funds or special revenue funds.
Proprietary Funds
Enterprise Funds - Enterprise funds are used to account for operations that are financed and operated in a
manner similar to private business enterprises, where the intent of the governing body is that the costs
(expenses, including depreciation) of providing goods or services to the general public on a continuing basis,
be financed or recovered primarily through user charges.
Internal Service Funds – Internal service funds are used to account for the financing of goods and services
provided by one department to other departments of the City on a cost-reimbursement basis. Internal service
funds are used for equipment replacement, insurance deductions and employee benefits.
As a general rule the effect of interfund activity has been eliminated from the government-wide financial
statements, however interfund services provided and used are not eliminated in the process of consolidation.
Amounts reported as program revenues include 1) charges to customers or applicants for goods, services, or
privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions, including
special assessments. Internally dedicated resources are reported as general revenues rather than as program
revenues. Likewise, general revenues include all taxes.
Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and
expenses generally result from providing services and producing and delivering goods in connection with a
proprietary fund’s principal ongoing operations. The principal operating revenues of the City enterprise funds and
internal service funds are charges to customers for sales and service. Operating expenses for enterprise funds and
internal service funds include the cost of sales and services, administrative expenses and depreciation on capital
assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and
expenses.
When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted
resources first, and then use unrestricted resources as they are needed.
D. CASH AND INVESTMENTS
Cash balances from all funds are combined and invested to the extent available in authorized investments pursuant
to Minnesota Statutes (see note 4). Earnings from such investments are allocated to the respective funds on the
basis of applicable cash balance participation by each fund. Investments in certificates of deposit with a maturity
date of less than one year at the date of purchase are reported at cost or amortized cost, which approximates fair
value. Investments held longer than one year are reported at fair value, based on quoted market prices.
51
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
The City accounts for its cash, cash equivalents and investments in an entity-wide cash management pool, which is
used essentially as a demand deposit account. For purposes of the statement of cash flows, the proprietary funds
consider all investments to be cash equivalents. Restricted cash and investments are reported separately on the
financial statement.
E. INTERFUND RECEIVABLES/PAYABLES
Activity between funds that is representative of lending/borrowing arrangements and transactions between funds
that are outstanding at the end of the fiscal year are referred to “due to/from other funds” Any residual balances
outstanding between the governmental activities and business-type activities are reported in the government-wide
financial statements as “internal balances.”
The non-current portion of due from other funds is offset by nonspendable fund balance in the general fund to
indicate that this portion of fund balance is not available for appropriation and is not expendable available
financial resources.
F. INVENTORIES AND PREPAID ITEMS
All inventories are accounted for using the consumption method and are valued at cost using the first-in/first-out
(FIFO) method.
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items
in both government-wide and fund financial statements. Prepaid items are reported using the consumption method
and recorded as expenditures/expenses at the time of consumption.
G. CAPITAL ASSETS
Capital assets, which include land, buildings, equipment and infrastructure assets (e.g., roads, bridges, curbs and
gutters, streets and sidewalks, drainage systems, lighting systems, and similar items), are reported in the applicable
governmental or business-type activities columns in the government-wide financial statements and the proprietary
fund financial statements. The City defines capital assets as assets with an initial, individual cost of more than
$5,000 and an estimated useful life in excess of three years. Such assets are recorded at historical cost. Donated
capital assets are recorded at estimated fair market value at the date of donation.
The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend assets
lives are not capitalized.
Assets not being depreciated include land and construction in progress. Buildings, equipment, and infrastructure
of the City and the HRA are depreciated using the straight-line method over the estimated useful lives as follows:
Buildings 30 - 40 years
Mains and Lines 40 - 50 years
S t r e e t s 2 0 - 2 5 y e a r s
Improvements 10 - 20 years
V e h i c l e s 3 - 3 0 y e a r s
Equipment 3 - 20 years
H. DEFERRED OUTFLOWS/INFLOWS OF RESOURCES
In addition to assets, the statement of financial position will sometimes report a separate section for deferred
outflows of resources. This separate financial statement element, deferred outflows of resources, represents a
consumption of net position that applies to a future period(s) and will not be recognized as an outflow of
52
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
resources (expense/expenditure) until then. The City has two items that qualify for reporting in this category. It is
the deferred charge on refunding reported in the government-wide statement of net position and the deferred
charge for pensions (see Pension section below for explanation). A deferred charge on refunding results from the
difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and
amortized over the shorter of the life of the refunded or refunding debt. In addition to liabilities, the statement of
financial position will sometimes report a separate section for deferred inflows of resources. This separate
financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to
a future period(s) and will not be recognized as an inflow of resources (revenue) until that time. The City has one
item item that qualifies for reporting in this category. It is the deferred charge for pensions (see Pension section
below for explanation). The City also has one type of item, which arises under a modified accrual basis of
accounting that qualifies for reporting in this category. Accordingly, the item, unavailable revenue, is reported
only in the governmental funds balance sheet. The governmental funds report unavailable revenues from four
sources: property taxes, special assessments, loans and grants. These amounts are deferred and recognized as an
inflow of resources in the period that the amounts become available.
I. COMPENSATED ABSENCES
The City compensates all employees upon termination for unused vacation or flex leave. Employees hired prior to
August 1, 1998 may opt to have sick leave, at the rate of 8 hours for each calendar month of full-time service,
instead of flex leave.
Employees hired prior to August 1, 1998, that have not opted for flex leave, shall be entitled to severance pay,
after completion of five years of continuous City employment. Severance pay is calculated by multiplying the
total number of continuous years in the City employ and/or accumulated sick leave by the daily wage rate
prevailing at date of severance, at one day per year of such employment, to a maximum of 20 days. Such
severance money shall be paid in case of separation caused by death, eligible retirements, or medically attested
disability preventing an employee from performing the major duties of the position or separation for non-
disciplinary reasons.
Accumulated vacation, flex and vested severance pay is reported as an expense and an accrued liability as the
benefits accrue to employees in the government-wide and proprietary fund financial statements. A liability for
these amounts is reported in the governmental funds only if benefits have matured as a result of employee
resignations and retirements. The employee benefits internal service fund reports the governmental funds’ liability
for compensated absences on the accrual basis.
J. PENSIONS
For purposes of measuring the net pension liability, deferred outflows/inflows of resources, and pension expense,
information about the fiduciary net position of the Public Employees Retirement Association (PERA) and
additions to/deductions from PERA's fiduciary net position have been determined on the same basis as they are
reported by PERA except that PERA's fiscal year end is June 30. For this purpose, plan contributions are
recognized as of employer payroll paid dates and benefit payments and refunds are recognized when due and
payable in accordance with the benefit terms. Investments are reported at fair value.
For purposes of measuring the liability, deferred outflows of resources and deferred inflows of resources, and
expense associated with the City's requirement to contribute to the Hopkins Fire Relief Association, information
about the Plan's fiduciary net position and additions to/deductions from the Hopkins Fire Relief Association Plan's
fiduciary net position have been determined on the same basis as they are reported by the Plan. For this purpose,
benefit payments (including refunds of contributions) are recognized when due and payable in accordance with the
benefit terms. Investments are reported at fair value.
53
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
K. LONG-TERM OBLIGATIONS
In the government-wide financial statements, and proprietary fund financial statements, long-term debt and other
long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities,
or proprietary fund type statement of net position. Bond premiums and discounts, amortized over the life of the
bonds. Bonds payable are reported net of the applicable bond premium or discount.
In the governmental fund financial statements bond premiums and discounts, as well as bond issuance costs are
recognized during the current period. The face amount of debt issued is reported as other financing sources.
Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are
reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received,
are reported as debt service expenditures.
L. NET POSITION/FUND EQUITY
Net position represents the difference between assets and liabilities in the government-wide financial statements.
Net position invested in capital assets consists of capital assets net of accumulated depreciation, reduced by the
outstanding balance of any long-term debt used to build or acquire the capital assets. Net position is reported as
restricted in the government-wide financial statements when there are limitations imposed on their use through
external restrictions imposed by creditors, grantors, laws or regulations of other governments.
In the fund financial statements, governmental funds report fund balances in classifications that disclose
constraints for which amounts in those funds can be spent. These classifications are as follows:
Nonspendable – portions of fund balance related to prepaids, inventories, long-term receivables, and land held
for resale.
Restricted – funds are constrained by external parties (statute, grantors, bond agreements, etc.).
Committed – fund constraints are established and modified by a resolution approved by the City Council.
Assigned – consists of internally imposed constraints. These constraints are established by the City Council
and/or management. The City Council also delegates the authority to assign fund balance to the Finance
Director per City Legislative Policy 6-G, Fund Balance.
Unassigned – is the residual classification for the General Fund and also reflects negative residual amounts in
other funds.
When an expenditure is incurred for purposes for which both restricted and unrestricted fund balance is available,
it is the City’s policy to use restricted first, then unrestricted fund balance.
When an expenditure is incurred for purposes for which committed, assigned, and unassigned amounts are
available, it is the City’s policy to use committed first, then assigned, and finally unassigned amounts.
The City formally adopted a fund balance policy for the General Fund. The policy establishes an unassigned fund
of a minimum of 5 months or 42% of the previous year’s budgeted expenditures.
54
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
M. INTERFUND TRANSACTIONS
Inter-fund services provided and used are accounted for as revenues and expenditures. Transactions that constitute
reimbursements to a fund for expenditures initially made from it that are properly applicable to another fund are
recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed.
All other interfund transactions are reported as transfers.
N. PROPERTY TAXES
Property tax levies are set by the City Council in December of each year, and are certified to Hennepin County
(the County) for collection in the following year. In the State of Minnesota, counties act as collection agents for
all property taxes. The County spreads all levies over assessable property. 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 taxpayers in two equal installments, on May 15 and October 15. Personal
property taxes are also payable by taxpayers in two equal installments, on February 28 and June 30. The County
provides tax settlements to cities and other local governments three times a year, on or before January 25, July 5
and December 5.
In the governmental fund financial statements property taxes are accrued and recognized as revenue for collections
within 60 days of year-end. Taxes that remain unpaid at the County on December 31 are classified as delinquent
taxes receivable, and are fully offset by deferred inflows of resources because they are not available to finance
current expenditures. No allowance for uncollectible taxes has been provided because such amounts are not
expected to be material.
O. CONDUIT DEBT OBLIGATIONS
From time to time, the City has issued Commercial Development Revenue Notes/Bonds in accordance with the
Minnesota Municipal Industrial Development Act. These obligations are issued to provide financial assistance to
private-sector entities for the acquisition and construction of industrial and commercial facilities deemed to be in
the public interest. The obligations are secured by the property financed and are payable solely from payments
received on the underlying mortgage loans. Upon repayment of the obligations, ownership of the acquired
facilities transfers from the bond holder to the private-sector entity served by the debt issuance. Neither the City,
the State, nor any political subdivision thereof is obligated in any manner for repayment of the obligations.
Accordingly, the bonds are not reported as liabilities in the accompanying financial statements. As of December
31, 2015, there were 7 notes/bond issues outstanding, with an aggregate principal amount payable of
approximately $31 million.
P. USE OF ESTIMATES
The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ from those estimates.
55
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
2. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS
A. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND BALANCE
SHEET AND THE GOVERNMENT-WIDE STATEMENT OF NET POSITION
The governmental fund balance sheet includes a reconciliation between fund balance – total governmental funds
and net position – governmental activities as reported in the government-wide statement of net position. One
element of that reconciliation explains that long-term liabilities, including bonds payable, are not due and payable
in the current period and therefore are not reported in the funds. Details of this difference are as follows:
Bonds payable $ 39,914,855
Accrued interest payable 325,248
Net OPEB obligation 144,904
Net adjustment to reduce fund balance - total governmental
funds to arrive at net position - governmental activities $ 40,385,007
B. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND STATEMENT
OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE AND THE GOVERNMENT-
WIDE STATEMENT OF ACTIVITIES
The governmental fund statement of revenues, expenditures, and changes in fund balances includes a
reconciliation between net changes in fund balances – total governmental funds and change in net position of
governmental activities as reported in the government-wide statement of activities. One element of that
reconciliation explains, “Governmental funds report capital outlays as expenditures. However, in the statement of
activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation
expense.” The details of this difference are as follows:
Capital outlay $ 8,789,979
Depreciation expense (1,522,232)
Net adjustment to increase net changes in fund balances -
total governmental funds to arrive at changes in net position
of governmental activities $ 7,267,747
Another element of that reconciliation explains that, “the issuance of long-term debt provides current financial
resources to governmental funds, while the repayment of the principal of long-term debt uses financial resources
of the governmental funds. Neither of these transactions has any effect on the net position. Also, governmental
funds report the effect of premiums, discounts and similar items when debt is first issued, whereas these amounts
are deferred and amortized in the statement of activities.” The details of these differences are as follows:
Principal repayments $ (8,570,000)
Issuance of general obligation bonds 18,735,000
Add premium 425,129
Less deferred loss on refunding debt (37,518)
OPEB expense (39,636)
Amortization of deferred losses on refunding 40,778
Amortization of bond premium and discount 13,332
Prior year interest expense (292,030)
Accrue interest expense for current year 325,248
Net adjustment to decrease net changes in fund balances -
total governmental funds to arrive at changes in net
position of governmental activities 10,600,303
56
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
3. STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
A. BUDGETS AND BUDGETARY ACCOUNTING
Annual budgets are adopted on a basis consistent with U.S. generally accepted accounting principles for all
governmental funds except the Section 8 and Hennepin County CDBG special revenue funds, the debt service
funds and the capital projects funds, which are not budgeted. A capital improvement plan is reviewed annually by
the City Council for the capital projects funds and utility funds. However, appropriations for major projects are
not adopted until the actual bid award of the improvement. The appropriations are not reflected in the financial
statements. All annual appropriations lapse at fiscal year-end.
The City follows these procedures in establishing the budgetary data reflected in the financial statements and set
forth in Section 7.04 of the City Charter.
1. The City Manager shall, at the first regular council meeting in September, submit to the Council a proposed
budget and an explanatory budget message in a form and manner as prescribed by the City Charter.
2. The Council shall determine the plan and time of the public hearings on the budget to obtain taxpayer
comments.
3. The Council shall adopt the tax levy by resolution no later than a December date, which is annually established
by law for the county auditor to levy taxes. The budget shall set forth the total for each budgeted fund with
such segregation as to objects and purposes of expenditures as the Council deems necessary for purposes of
budget control.
4. The City Manager is authorized to transfer budgeted amounts between departments within any fund; however,
any revisions that alter the total expenditures of any fund must be approved by the City Council and are limited
to the amount revenues exceed the budgets or authorize the transfer of sums from unexpended balances to other
purposes. Budgeted expenditure appropriations lapse at year-end. The level of legal control is at the fund
level.
5. The Council made no supplemental budgetary appropriation throughout the year.
B. EXCESS OF EXPENDITURES OVER APPROPRIATIONS
For the year ended December 31, 2015, actual expenditures exceeded the budgeted amounts in the following
funds:
Economic Development $ 224,666
State Chemical Assessment Team 56,131
Real Estate Purchases and Sales 35
Parking 65,192
Depot Coffee House 29,485
Tax Increment District Entertainment District 10,427
5th Avenue Flats 2,209
Tax Increment Marketplace & Main 27,921
These over expenditures were funded by greater than anticipated revenues of the Economic Development, State
Chemical Assessment Team, Parking, Depot Coffee House, and Tax Increment District Entertainment District
funds, from fund balance in the State Chemical Assessment Team, and Real Estate Purchase & Sales funds, and by
future revenues in the Arts Center, 5th Avenue Flats and Tax Increment District Marketplace & Main funds.
57
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
Budgets are adopted for some special revenue fund types but not all. Excluded from the budget adoption process
are funds that are completely reimbursable from the federal and state governments. The Community Development
Block Grant Funds is a non-budgeted fund.
C. FUND BALANCE DEFICITS
At December 31, 2015, the following funds had deficit fund balances or net position. These deficits will be
funded through future tax levies, contributions, grants, charges for services or developer payments:
Art Center $ 1,183,024
State Chemical Assessment 1,918
Depot Coffee House 10,780
Tax Increment District Entertainment District 22,002
Tax Increment District Sonoma 137,862
5th Avenue Flats 386,947
Tax Increment District Marketplace & Main 218,385
D. NET POSITION RESTRICTED BY ENABLING LEGISLATION
The government-wide statement of net position reports $4,217,494 in restricted net position for economic
development, of which $4,073,601 is restricted by enabling legislation.
4. DEPOSITS AND INVESTMENTS
As of December 31, 2015 the City had the following deposits and investments:
Investment Type Fair Value
Government sponsored entities $ 495,152
Municipal obligations 5,498,980
Negotiable certificates of deposit 10,263,040
Money market 13,530,796
Deposits 434,480
Total fair value cash and investments $ 30,222,448
Interest rate risk – Interest rate risk is the risk that the fair value of investments will be adversely affected by a change
in interest rates. In accordance with City of Hopkins Legislative Policy 6-B, Standards of Investments, the city
manages its exposure to declines in fair values by structuring the investment portfolio so that securities mature to meet
cash requirements for ongoing operations, thereby avoiding the need to sell securities on the open market prior to
maturity.
At December 31, 2015 the City had the following investment maturities:
Investment Maturities (in Years)
Fair Less No
Value than One 1-5 6-10 Maturity
Investment Type:
Government sponsored entities
FNMA $ 495,151 $ - $ 495,151 $ - $ -
Municipal obligations 5,498,981 1,306,859 3,600,458 591,664 -
Negotiable certificates of deposit 10,263,040 5,145,000 5,118,040 - -
Repurchase agreement 13,530,796 - - - 13,530,796
Demand deposits 434,480 - - - 434,480
$ 30,222,448 $ 6,451,859 $ 9,213,649 $ 591,664 $ 13,965,276
58
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
Credit risk – Credit risk is the risk that an issuer or other counter party to an investment will not fulfill its obligations.
Credit risk is measured using credit quality ratings of investments in debt securities as described by nationally
recognized rating agencies such as Standard & Poor’s and Moody’s. According to the City’s investment policy
commercial paper shall be restricted to issues, which mature in 270 days or less with a rating of A-1 (Moody’s), P-1
(Standard & Poor’s) or F-1 (Fitch) among at least two of the three rating agencies.
The City is authorized by Minnesota Statutes to invest in the following:
(a) Direct obligations or obligations guaranteed by the United States or its agencies
(b) Shares of investment companies registered under the Federal Investment Company Act of 1940 and
whose only investments are in securities described in (a) above
(c) General obligations in the State of Minnesota or any of its municipalities
(d) Bankers’ acceptances of United States banks eligible for purchase by the Federal Reserve System
(e) Commercial paper issued by United States corporations or their Canadian subsidiaries, of the highest
quality, and maturity in 270 days or less; and
(f) Guaranteed investment contracts issued or guaranteed by United States commercial banks or domestic
branches of foreign banks or United States insurance companies or their subsidiaries
(g) Repurchase or reverse repurchase agreements with banks that are members of the Federal Reserve System
with capitalization exceeding $10,000,000, a primary reporting dealer in U.S. Government securities to
the Federal Reserve Bank of New York, or certain Minnesota securities broker-dealers.
The following table lists the credit quality ratings per Moody’s and/or Standard and Poor’s and/or Fitch of the
City’s investments at December 31, 2015.
Quality Ratings
Fair Not
Value AAA AA Rated
Investment Type:
Government securities
FNMA $ 495,152 $ - $ 495,152 $ -
Municipal obligations 5,498,980 1,754,867 3,744,113 -
Negotiable certificates of deposit 10,263,040 - - 10,263,040
Repurchase agreement 13,530,796 - - 13,530,796
Demand deposits 434,480 - - 434,480
$ 30,222,448 $ 1,754,867 $ 4,239,265 $ 24,228,316
Custodial credit risk
Deposits – For deposits, this is the risk that in the event of a bank failure, the City’s deposits may not be
returned to it. Minnesota Statutes require that all City 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
bonds. Authorized collateral includes the legal investments described above, as well as certain first mortgage
notes, and certain other state or local government obligations. Minnesota Statutes require that securities
pledged as collateral be held in safekeeping by the City treasurer or in a financial institution other than that
furnishing the collateral. At December 31, 2014 the City had no deposits that were uninsured or
uncollateralized. The deposits were insured or collateralized by securities held by the City’s agent in the City’s
name.
Investments – For an investment, this is the risk that, in the event of the failure of the counterparty, the City
will not be able to recover the value of its investments or collateral securities that are in the possession of an
outside party. All investments held by the City are insured or registered or are held by the City or its agent in
the City’s name. The City has no investments that are uninsured or unregistered nor are any investments held
by a counterparty or a counterparty's trust department or agent that is not in the city's name.
59
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
Concentration of credit risk – This is the risk associated with investing a significant portion of the City’s investments
(considered 5% or more) in the securities of a single issuer, excluding U.S. explicitly guaranteed investments
(Treasuries), investment pools, and mutual funds. As of December 31, 2015, the city had no investments exceeding
5% or more for a single issuer.
5. CAPITAL ASSETS
Capital asset activities for the year ended December 31, 2015 were as follows:
Beginning Ending
Balance Increase Decreases Transfers Balance
Governmental activities:
Capital assets, not being depreciated
Land $ 6,157,677 $ - $ - $ - $ 6,157,677
Construction in progress 3,897,070 8,602,064 (106,650) (3,974,368) 8,418,116
Total not being depreciated 10,054,747 8,602,064 (106,650) (3,974,368) 14,575,793
Capital assets, being depreciated
Buildings 20,006,594 176,478 - 64,706 20,247,778
Other Improvements 38,341,781 - - 3,517,776 41,859,557
Vehicles 3,988,628 219,564 (174,944) - 4,033,248
Machinery & equipment 5,170,046 935,880 (86,632) 391,886 6,411,180
Total being depreciated 67,507,049 1,331,922 (261,576) 3,974,368 72,551,763
Less accumulated depreciation
Buildings (6,168,019) (491,615) - - (6,659,634)
Other Improvements (16,174,355) (975,008) - - (17,149,363)
Vehicles (2,119,550) (247,932) 174,944 - (2,192,538)
Machinery & equipment (3,785,371) (281,716) 86,632 - (3,980,455)
Total accumulated depreciation (28,247,295) (1,996,271) 261,576 - (29,981,990)
Total capital assets, being
depreciated, net 39,259,754 (664,349) - 3,974,368 42,569,773
Governmental activities capital
assets, net $ 49,314,501 $ 7,937,715 $ (106,650) $ - $ 57,145,566
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60
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
Beginning Ending
Balance Increases Decreases Transfers Balance
Business-type Activities:
Capital assets, not being depreciated
Land $ 254,299 $ - $ - $ $ 254,299
Construction in progress 2,785,338 1,235,851 (282,118) (2,289,692) 1,449,379
Total not being depreciated 3,039,637 1,235,851 (282,118) (2,289,692) 1,703,678
Capital assets, being depreciated
Buildings 8,019,452 44,965 - 65,198 8,129,615
Infrastructure 19,141,910 - - - 19,141,910
Other Improvements 9,834,041 - - 2,224,494 12,058,535
Vehicles 754,107 232,515 - 36,739 1,023,361
Machinery & equipment 913,408 - - (36,739) 876,669
Total being depreciated 38,662,918 277,480 - 2,289,692 41,230,090
Less accumulated depreciation
Buildings (4,606,537) (238,126) - - (4,844,663)
Infrastructure (11,809,724) (401,334) - - (12,211,058)
Other Improvements (1,834,604) (217,967) - - (2,052,571)
Vehicles (493,357) (62,545) - - (555,902)
Machinery & equipment (532,403) (35,683) - - (568,086)
Total accumulated depreciation (19,276,625) (955,655) - - (20,232,280)
Total capital assets, being
depreciated, net 19,386,293 (678,175) - 2,289,692 20,997,810
Business-type activities capital
assets, net $ 22,425,930 $ 557,676 $ (282,118) $ - $ 22,701,488
Depreciation expense was charged to City functions as follows:
Governmental activities:
General government $ 57,156
Public safety 207,345
Highways and streets 1,121,942
Urban redevelopment and housing -
Culture and recreation 135,787
Capital assets held by the government's internal service funds are 474,041
charged to the various functions based on their usage of the assets
Total depreciation expense - governmental activities $ 1,996,271
Business-type activities:
Water $ 241,645
Sewer 174,758
Storm Sewer 230,152
Refuse 52,214
Pavilion/Ice arena 80,857
Housing and Redevelopment Authority 176,029
Total depreciation expense - business-type activities $ 955,655
61
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
Construction commitments
The City has active construction projects as of December 31, 2054. The projects include street improvements. The
City’s commitment with contractors related to these projects is $198,932.
On October 15, 2013 the City Council entered into a 14 year maintenance agreement with SEH Design/Build, Inc. for
inspection, maintenance, cleaning and painting of the city's two water towers. The contract commitment totals
$1,529,400 and will be paid in annual installments beginning in 2014.
6. INTERFUND RECEIVABLES AND PAYABLES
The following funds had amounts receivable from other funds, and the respective funds had equal amounts payable
to other funds at December 31, 2015:
Due from Other Funds
Economic
General Development Total
Due to other funds:
Non-major governmental $ 403,721 $ 555,090 $ 958,811
Arts Center 852,597 300,000 1,152,597
Permanent Improvement Revolving - - -
Water 172,965 - 172,965
Non-major proprietary 39,408 - 39,408
Total due to other funds $ 1,468,691 $ 855,090 $ 2,323,781
The interfund receivables and payables are to eliminate negative cash between funds and to allow for development
loans or to facilitate a project or operations of another fund.
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62
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
7. INTERFUND TRANSFERS
The following is a summary of transfers between funds as of December 31, 2015:
Transfers in
Permanent
Art Economic Improvement Non-major Storm
Center Development Revolving Governmental Water Sewer Sewer Total
T r a n s f e r s o u t :
General $ - $ - $ - $ 10,000 $$ $ - $ 10,000
Economic
Development - - - - - -
Tax Increment District
Super Valu - - - 231,910 231,910
Permanent
Improvement
Revolving - - - 308,840 496,274 297,004 605,843 1,707,961
Water - - - 100,300 100,300
Sewer - - - 105,300 - 105,300
Storm Sewer - - - 304,334 - 304,334
Non-major
governmental 86,920 2,127 5,361,851 1,977,053 - 7,427,951
Non-major business-
type - 25,000 - 25,000
Total transfers in $ 86,920 $ 2,127 $ 5,361,851 $ 3,062,737 $ 496,274 $ 297,004 $ 605,843 $ 9,912,756
Interfund transfers allow the City to allocate financial resources to debt service funds that are paying the general
obligation debt.
Non-routine transfers include the following:
1) Annual transfers from water, sewer, storm sewer and refuse funds for lease payments on new public works
facility.
2) An annual transfer, from the non-major governmental Communication funds to the Art Center Fund totaling
$86,920 to pay the original debt for building the facility.
3) Annual transfers from Tax Increment Special Revenue funds to Debt Service funds for debt payments.
4) Transfers from non-major governmental funds to Permanent Improvement Revolving for bond proceeds.
5) Transfer from the water, sewer and storm sewer funds to a non-major governmental Park Dedication fund of
$340,000 for Cottageville Park improvements.
6) Transfer from the Permanent Improvement Revolving to a non-major governmental Park Dedication fund of
$225,000 for Cottageville Park improvements.
7) Transfers from water, sewer and storm sewer to non-major governmental debt funds for bond payment
contributions.
63
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
8. LEASES
The city has entered into a lease agreement as a lessee for financing the acquisition of an aerial lift fire truck with a
down payment of $445,427. The lease agreement qualifies as a capital lease for accounting purposes and, therefore,
has been recorded at the present value of their future minimum lease payments as of the inception date.
The asset acquired through the capital lease is as follows:
Governmental Activities
Asset:
Machinery and equipment $ 870,427
Less: Accumulated depreciation (311,848)
Total $ 558,579
The future minimum lease obligations and the net present value of these minimum lease payments as of December
31, 2014 are as follows:
Governmental
Year Ending December 31, Activities
2016 $ 54,217
2017 54,217
2018 54,217
Total minimum lease payments 162,651
Less: amount representing interest (13,035)
Present value of minimum lease payments $ 149,616
9. LONG-TERM DEBT
The City issues general obligation bonds to provide funds for the acquisition and construction of major capital
facilities. General obligation bonds have been issued for governmental activities.
General Obligation Bonds are backed by the full faith, credit and taxing power of the City, and are serviced by
General and Tax Increment levies and also by fees assessed against benefited properties. These bonds generally are
issued as 20-year serial bonds.
Refunding
On November 20, 2014 the City issued $6,345,000 General Obligation Refunding Bonds, Series 2014B for a
refunding of $5,700,000 General Obligation Capital Improvement Bonds, Series 2007A and $645,000 of General
Obligation Permanent Improvement Revolving Bonds, Series 2007B. Future combined debt service payments will
be reduced by $691,761 with a present value savings of $651,072. The refunded bonds were called and paid on
February 1, 2015.
On November 24, 2015 the City issued $4,340,000 General Obligation Tax Increment Revenue Refunding Bonds,
Series 2015C to refinance the 2008 HRA Tax Increment Bonds. Future debt service payments will be reduced by
$1,512,822 with a present value savings of $1,653,200. The refunded bonds were paid on February 1, 2016.
On December 22, 2015 the City issued $7,355,000 General Obligation Tax Increment Revenue Refunding Bonds,
Series 2015D to refinance the 2007 HRA Tax Increment Bonds. Future debt service payments will be reduced by
$2,286,264 with a present value savings of $2,684,264. The refunded bonds were paid on February 1, 2016.
The 2007 and 2008 HRA Tax Increment Bonds were originally issued as Pay-As-You-Go Bonds by the developer
which were backed by tax increment revenues received by the City. These developer issued bonds were not an
obligation of the City and therefore were not recognized in the City’s financials. Therefore there is no economic gain
or loss by the City.
64
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
General Obligation Bonds
On May 28, 2015 the City issued $4,100,000 General Obligation Street Reconstruction Bonds, series 2015A for the
2015 street reconstruction project and $2,940,000 General Obligation Tax Abatement Bonds, Series 2015B for park
projects and parking lot improvements.
General obligation bonds currently outstanding are as follows:
Purpose Interest Rates Original Amount Current Amount
Governmental activities 0.35 – 5.00% 9,740,000 $ 9,055,000
Governmental activities – refunding 0.50 – 5.15% 24,215,000 21,550,000
Annual debt service requirements to maturity for general obligation bonds are as follows:
Year Ending Governmental Activities
December 31 Principal Interest
2016 $ 2,480,000 $ 619,496
2017 2,480,000 630,899
2018 2,540,000 577,323
2019 2,400,000 422,884
2020 2,465,000 467,793
2021-2025 9,725,000 1,587,958
2026-2030 7,145,000 671,114
2031-2035 1,180,000 104,080
2036 190,000 3,040
$ 30,605,000 $ 5,084,587
The City also has special assessment bonds, which are backed by the full faith, credit and taxing power of the City,
and repayment monies are generated by the collection of special assessments and general levies.
General obligation bonds currently outstanding are as follows:
Purpose Interest Rates Original Amount Current Amount
Street Improvements 0.50 – 4.25% 9,810,000 $ 8,660,000
Annual debt service requirements to maturity for special assessment bonds are as follows:
Year Ending Governmental Activities
December 31 Principal Interest
2016 $ 595,000 $ 194,703
2017 600,000 183,409
2018 620,000 171,428
2019 635,000 158,646
2020 645000 145,188
2021-2025 3,350,000 492,110
2026-2030 2,215,000 110,405
$ 8,660,000 $ 1,455,889
65
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
Revenue Bonds
The City also issues bonds where the government pledges income derived from the acquired or constructed assets to
pay debt service.
Revenue bonds outstanding at year-end are as follows:
Purpose Interest Rates Original Amount Current Amount
Water construction & replacement 2.0 – 4.0% 820,000 585,000
Water construction & replacement 2.0 – 2.2% 760,000 640,000
Water construction & replacement 2.0 - 2.5% 860,000 810,000
Sanitary sewer construction & replacement 2.0 – 4.0% 1,020,000 730,000
Sanitary sewer construction & replacement 2.0 – 2.2% 170,000 140,000
Sanitary sewer construction & replacement 2.0 - 2.5% 490,000 460,000
Storm sewer – refunding 0.5 – 2.9% 875,000 610,000
Storm sewer construction & replacement 2.0 – 2.2% 320,000 270,000
Storm sewer construction & replacement 2.0 - 2.5% 380,000 360,000
Pavilion equipment certificates 2.0 – 2.0% 175,000 140,000
Revenue bond debt service requirements to maturity are as follows:
Year Ending
December 31 Principal Interest
2016 $ 380,000 $ 117,794
2017 385,000 108,969
2018 395,000 99,494
2019 405,000 89,563
2020 410,000 78,951
2021-2025 1,980,000 222,463
2026-2029 790,000 34,385
$ 4,745,000 $ 751,619
The City is subject to a statutory limit of bonded indebtedness equaling 3.0 percent of taxable market value. At
December 31, 2015, the debt limit for the City is $48,167,756. Of the total debt, $15,400,000 of general obligation
and revenue bonds is applicable to the limit. The legal debt margin is $32,767,756.
66
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
Changes in Long-Term Liabilities
Long-term liability activity for the year ended December 31, 2015, was as follows:
Beginning Ending Due Within
Balance Additions Deductions Balance One Year
Governmental Activities:
Bonds payable:
G.O. tax increment bonds $ 4,120,000 $ 11,695,000 $ 610,000 $ 15,205,000 $ 1,370,000
General obligation bonds 14,965,000 7,040,000 6,605,000 15,400,000 1,110,000
Total general obligation bonds 19,085,000 18,735,000 7,215,000 30,605,000 2,480,000
Special assessment bonds 10,015,000 - 1,355,000 8,660,000 595,000
Less deferred amounts
For issuance discounts (95,338) - 46,910 (48,428) -
For issuance premiums 306,732 425,128 33,577 698,283 -
Total bonds payable 29,311,394 19,160,128 8,650,487 39,914,855 3,075,000
Compensated absences 836,441 905,264 936,041 805,664 805,664
Net OPEB liability 184,540 163,184 202,820 144,904 -
Net pension liability - 6,518,754 - 6,518,754 -
Governmental activity
long-term liabilities $ 30,332,375 $ 26,747,330 $ 9,789,348 $ 47,384,177 $ 3,880,664
Business-type activities:
Bonds payable:
Revenue bonds $ 5,420,000 $ - $ 675,000 $ 4,745,000 $ 380,000
Less deferred amounts
For issuance discounts (5,793) - 717 (5,076) -
For issuance premiums 73,795 - (6,087) 67,708 -
Total bonds payable 5,488,002 - 669,630 4,807,632 380,000
Compensated absences 172,861 9,071 97,995 83,937 81,713
Net OPEB liability 38,115 37,979 42,360 33,734 -
Net pension liability - 844,388 - 844,388 22,458
Capital lease payable 194,868 - 45,252 149,616
Business-type activity
long-term liabilities $ 5,893,846 $ 891,438 $ 855,237 $ 5,919,307 $ 484,171
For the governmental activities, compensated absences and the net OPEB liability are generally liquidated by the
general and special revenue funds.
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67
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
10. FUND BALANCES
At December 31, 2015, the City had various fund balances through legal restriction and City Council
authorization. Major fund balance appropriations at December 31, 2015 are shown on the various balance sheets as
segregations of the fund balance. The fund balances are as follows:
Total Nonspendable Restricted Committed Assigned Unassigned
General Fund $ 5,439,799 $ - $ - $ - $ - $ 5,439,799
Inventories 102,124 102,124 - - - -
Prepaid items 124,988 124,988 - - - -
Community development 340,189 - - - 340,189 -
Total General Fund 6,007,100 227,112 - - 340,189 5,439,799
Economic Development
Facade Grant 100,000 - 100,000 - - -
Economic Development 4,285,982 - - 4,285,982 - -
Total Economic Development Fund 4,385,982 - 100,000 4,285,982 - -
Arts Center
Prepaid items 68 68 - - - -
Deficit Fund Balance (1,183,024) - - - - (1,183,024)
Total Arts Center Fund (1,182,956) 68 - - - (1,183,024)
Tax Increment District Super Valu
Property held for resale 321,719 321,719
Tax Increment 3,190,011 3,190,011
Total Tax Increment District
Super Valu 3,511,730 - 3,511,730 - - -
Housing Improvement Bonds of 1999B
Refunding Bonds of 2009B
Debt service 694,722 - 694,722 - - -
2015D G.O. TI Revenue Bonds
Debt service 7,454,556 - 7,454,556 - - -
Permanent Improvement Revolving
Capital asset replacement 442,413 - - - 442,413 -
Nonmajor Governmental Funds
Prepaid items 136 136 - - - -
Rehab loans 43,893 - 43,893 - - -
Debt service 4,095,157 - 4,095,157 - - -
Tax increment 561,871 - 561,871 - - -
Park improvements 258,547 - 258,547 - - -
Economic development - - - - -
Parking improvements 63,744 - - 63,744 - -
Communications 532,883 - - 532,883 - -
Capital asset replacement 806,826 - - - 806,826 -
Deficit fund balance (777,894) - - - - (777,894)
Total Nonmajor Funds 5,585,163 136 4,959,468 596,627 806,826 (777,894)
Total Fund Balances $ 26,898,710 $ 227,316 $ 16,720,476 $ 4,882,609 $ 1,589,428 $ 3,478,881
68
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
11. PENSION PLAN OBLIGATIONS
1. Defined Benefit Pension Plans - Statewide
A. Plan Description
The City participates in the following cost-sharing multiple-employer defined benefit pension plans administered
by the Public Employees Retirement Association of Minnesota (PERA). PERA’s defined benefit pension plans
are established and administered in accordance with Minnesota Statutes, Chapters 353 and 356. PERA’s defined
benefit pension plans are tax qualified plans under Section 401 (a) of the Internal Revenue Code.
1. General Employees Retirement Fund (GERF)
All full-time and certain part-time employees of the City are covered by the General Employees Retirement
Fund (GERF). GERF 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. The Basic Plan was closed to new
members in 1967. All new members must participate in the Coordinated Plan.
2. Public Employees Police and Fire Fund (PEPFF)
The PEPFF, originally established for police officers and firefighters not covered by a local relief association, now
covers all police officers and firefighters hired since 1980. Effective July 1, 1999, the PEPFF also covers police
officers and firefighters belonging to a local relief association that elected to merge with and transfer assets and
administration to PERA.
Benefits Provided
PERA provides retirement, disability, and death benefits. Benefit provisions are established by state statute and can
only be modified by the state legislature.
Benefit increases are provided to benefit recipients each January. Increases are related to the funding ratio of the
plan. Members in plans that are at least 90 percent funded for two consecutive years are given 2.5% increases.
Members in plans that have not exceeded 90% funded, or have fallen below 80%, are given 1% increases.
The benefit provisions stated in the following 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.
1.GERF Benefits
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 a 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 ten years of service and 2.7% for each remaining year. The annuity accrual rate for
a Coordinated Plan member is 1.2 percent of average salary for each of the first ten 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 members hired prior to July 1, 1989, a full annuity is
available when age plus years of service equal 90 and normal retirement age is 65. For members hired on or after
July 1, 1989, normal retirement age is the age for unreduced Social Security benefits capped at 66. Disability
benefits are available for vested members and are based upon years of service and average high-five salary.
69
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
2. PEPFF Benefits
Benefits for the PEPFF members first hired after June 30, 2010, but before July 1, 2014, vest on a prorated basis
from 50% after five years up to 100% after ten years of credited service. Benefits for PEPFF members first hired
after June 30, 2014, vest on a prorated basis from 50% after ten years up to 100% after twenty years of credited
service. The annuity accrual rate is 3% of average salary for each year of service. For PEPFF who were first hired
prior to July 1, 1989, a full annuity is available when age plus years of service equal at least 90.
B. Contributions
Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. Contribution rates can only
be modified by the state legislature.
1. GERF Contributions
Basic Plan members and Coordinated Plan members were required to contribute 9.1% and 6.50%, respectively, of
their annual covered salary in calendar year 2015. The City was required to contribute 11.78% of pay for Basic Plan
members and 7.50% for Coordinated Plan members in calendar year 2015. The City’s contributions to the GERF for
the year ended December 31, 2015, were $343,161. The City’s contributions were equal to the required
contributions as set by state statute.
2. PEPFF Contributions
Plan members were required to contribute 10.8% of their annual covered salary in calendar year 2015. The City was
required to contribute 16.20% of pay for PEPFF members in calendar year 2015. The City’s contributions to the
PEPFF for the year ended December 31, 2015, were $423,942. The City’s contributions were equal to the required
contributions as set by state statute.
C. Pension Costs
1. GERF Pension Costs
At December 31, 2015, the City reported a liability of $4,306,673 for its proportionate share of the GERF’s net
pension liability. The net pension liability was measured as of June 30, 2015, and the total pension liability used to
calculate the net pension liability was determined by an actuarial valuation as of that date. The City’s proportion of
the net pension liability was based on the City’s contributions received by PERA during the measurement period for
employer payroll paid dates from July 1, 2014, through June 30, 2015, relative to the total employer contributions
received from all of PERA’s participating employers. At June 30, 2015, the City’s proportion was .0831%, which
was a decrease of .0058% from its proportion measured as of June 30, 2014.
For the year ended December 31, 2015, the City recognized pension expense of $505,955 for its proportionate share
of the GERF’s pension expense.
70
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS, (CONT.)
December 31, 2015
At December 31, 2015, the City reported its proportionate share of the GERF’s deferred outflows of resources and
deferred inflows of resources related to pensions from the following sources:
Description
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Differences between expected and actual economic
experience
$ - $ 217,130
Changes of assumptions
Net difference between projected and actual earnings on
pension plan investments
407,693 -
Changes in proportion and differences between city
contributions and proportionate share of contributions
- 204,341
City contributions subsequent to the measurement date 172,861 -
Total $ 580,554 $ 421,471
A total of $172,861 reported as deferred outflows of resources related to pensions resulting from City contributions
subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended
December 31, 2016. Other amounts reported as deferred outflows and inflows of resources related to pensions will
be recognized in pension expense as follows:
Year Ended June 30
2016 (38,567)
2017 (38,567)
2018 (38,567)
2019 101,923
2020 -
Thereafter -
2. PEPFF Pension Costs
At December 31, 2015, the City reported a liability of $3,056,469 for its proportionate share of the PEPFF’s net
pension liability. The net pension liability was measured as of June 30, 2015, and the total pension liability used to
calculate the net pension liability was determined by an actuarial valuation as of that date. The City’s proportion of
the net pension liability was based on the City’s contributions received by PERA during the measurement period for
employer payroll paid dates from July 1, 2014, through June 30, 2015, relative to the total employer contributions
received from all of PERA’s participating employers. At June 30, 2015, the City’s proportion was .269%, which was
a decrease of .001% from its proportion measured as of June 30, 2014.
For the year ended December 31, 2015, the City recognized pension expense of $524,902 for its proportionate share
of the PEPFF’s pension expense. The City also recognized $24,210 for the year ended December 31, 2015, as
pension expense (and grant revenue) for its proportionate share of the State of Minnesota’s on-behalf contributions to
the PEPFF. Legislation passed in 2013 required the State of Minnesota to begin contributing $9 million to the PEPFF
each year, starting in fiscal year 2014.
71
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS, (CONT.)
December 31, 2015
At December 31, 2015, the City reported its proportionate share of the PEPFF’s deferred outflows of resources and
deferred inflows of resources related to pensions from the following sources:
Description
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Differences between expected and actual economic
experience
$ - $ 495,659
Changes of assumptions
Net difference between projected and actual earnings on
pension plan investments
532,539 -
Changes in proportion and differences between city
contributions and proportionate share of contributions
- 9,000
City contributions subsequent to the measurement date 217,542 -
Total $ 750,081 $ 504,659
A total of $217,542 reported as deferred outflows of resources related to pensions resulting from City contributions
subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended
December 31, 2016. Other amounts reported as deferred outflows and inflows of resources related to pensions will
be recognized in pension expense as follows:
Year Ended June 30
2016 32,203
2017 32,203
2018 32,203
2019 32,203
2020 (100,932)
Thereafter -
D. Actuarial Assumptions
The total pension liability in the June 30, 2015, actuarial valuation was determined using the following actuarial
assumptions:
Inflation 2.75% per year
Active Member Payroll Growth 3.50% per year
Investment Rate of Return 7.90%
Salary increases were based on a service-related table. Mortality rates for active members, retirees, survivors and
disabilitants were based on RP-2000 tables for males or females, as appropriate, with slight adjustments. Benefit
increases for retirees are assumed to be 1% effective every January 1st through 2026 and 2.5% thereafter.
Actuarial assumptions used in the June 30, 2015, valuation were based on the results of actuarial experience studies.
The experience study in the GERF was for the period July 1, 2004, through June 30, 2008, with an update of
economic assumptions in 2014. Experience studies have not been prepared for PERA’s other plans, but assumptions
are reviewed annually.
There were no changes in actuarial assumptions in 2015.
The long-term expected rate of return on pension plan investments is 7.9%. The State Board of Investment, which
manages the investments of PERA, prepares an analysis of the reasonableness of the long-term expected rate of return
on a regular basis using a building-block method in which best-estimate ranges of expected future rates of return are
72
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
developed for each major asset class. These ranges are combined to produce an expected long-term rate of return by
weighting the expected future rates of return by the target asset allocation percentages. The target allocation and best
estimates of arithmetic real rates of return for each major asset class are summarized in the following table:
Asset Class Target Allocation Long-Term Expected Real
Rate of Return
Domestic Stocks 45% 5.50%
International Stocks 15% 6.00%
Bonds 18% 1.45%
Alternative Assets 20% 6.40%
Cash 2% 0.50%
E. Discount Rate
The discount rate used to measure the total pension liability was 7.9%. The projection of cash flows used to
determine the discount rate assumed that employee and employer contributions will be made at the rate specified in
statute. Based on that assumption, each of the pension plan’s fiduciary net position was projected to be available to
make all projected future benefit payments of current active and inactive employees. Therefore, the long-term
expected rate of return on pension plan investments was applied to all periods of projected benefit payments to
determine the total pension liability.
F. Pension Liability Sensitivity
The following presents the City’s proportionate share of the net pension liability for all plans it participates in,
calculated using the discount rate disclosed in the preceding paragraph, as well as what the City’s proportionate share
of the net pension liability would be if it were calculated using a discount rate 1 percentage point lower or 1
percentage point higher than the current discount rate:
Description
1% Decrease in
Discount Rate
(6.9%)
Discount Rate
(7.9%)
1% Increase
in Discount
Rate (8.9%)
City's Proportionate Share of the GERF Net
Pension Liability:6,771,621$ 4,306,673$ 2,271,005$
City's Proportionate Share of the PEPFF Net
Pension Liability:5,957,091 3,056,469 660,051
G. Pension Plan Fiduciary Net Position
Detailed information about each pension plan’s fiduciary net position is available in a separately-issued PERA
financial report that includes financial statements and required supplementary information. 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.
73
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
2. Hopkins Fire Relief Association (HFRA)
A. Plan Description
Firefighters of the City of Hopkins are members of the Hopkins Fire Department Relief Association. The
Association is the administrator of the single-employer defined benefit pension plan available to firefighters. The
plan was established in 1909 and is administered pursuant to Minnesota Statutes Chapter 69, Chapter 424A, and
the Association’s by-laws. It is governed by a Board of Trustees made up of six members elected by the members
of the Association for three year terms, and the Mayor, City Clerk and Fire Chief, who serve as ex-officio voting
members of the Board of Trustees. As of December 31, 2014, membership includes 40 active participants and 18
vested terminated employees entitled to benefit but not yet receiving them.
The Association issues a publically available financial report that includes financial statements and required
supplementary information of the Hopkins Fire Relief Association. That report may be obtained by writing to the
Hopkins Fire Relief Association, 1010 First St S, Hopkins, MN 55343.
For financial reporting purposes, the Association’s financial statements are not included with the City financial
statements because the Association is not a component unit of the City. The Association does not have any
component units.
B. Benefits Provided
The Association operates under a defined benefit plan. The pension liability is calculated by the number of active
service years multiplied by a set benefit level. The Association’s current level is at $6,100 per active year. According
to the bylaws of the Association and pursuant to Minnesota statute 424A.02, subdivisions 2 and 4, members who retire
with less than 20 years of service and have reached the age of 50 years and have completed at least ten years of active
membership are entitled to a reduced service pension not to exceed the amount calculated by multiplying the
member’s service pension for the completed years of service times the applicable non-forfeitable percentage of
pension. The defined retirement benefits are based on members’ years of service. Vesting begins after the 10th year of
service with a 60% benefit increasing by 4% per year to 100% after the 20th year of service.
If a member of the Association shall become totally and permanently disabled, with a service related disability (injured
in the line of duty) to the extent that a physician or surgeon acceptable to the Board shall certify that such disability
will permanently prevent said member from performing said member’s duties in the Department, the Association shall
pay to such member the sum of the current pension amount for each year and fractions of a year that the member has
served as an active member of the Department, without regard to minimum or partial vesting requirements. If a
member who has received such a disability pension should subsequently recover and return to active duty in the
Department, any amount paid to said member as a disability pension shall be deducted from said member’s service
pension.
Upon the death of any member of the Association who is in good standing at the time of said member’s death, the
Association shall pay to the surviving spouse, if any, and if there is no surviving spouse, to child or children, if any,
and if no child or children survive, to the estate of such deceased member, the credited sum of said member’s pension.
C. Contributions
Minnesota Statues Chapter 424A.093 specifies minimum support rates required on an annual basis. The significant
actuarial assumptions used to compute the municipal support are the same as those used to compute the accrued
pension liability. The association is comprised of volunteers; therefore, there are no payroll expenditures (i.e. there are
no covered payroll percentage calculations). The minimum contribution from the City of Hopkins and state aid is
determined as follows:
74
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
Normal Cost for the Next Year
+ Amortization of Unfunded Actuarial Liability as Reported
in the Latest Actuarial Valuation
+ Administrative Expenses for the Prior Year Multiplied
by a Factor of 1.035
- Anticipated State Aid (Not to Exceed the Fire Aid Received
in the Prior Year Multiplied by a Factor of 1.035)
- Anticipated Contributions Required by the Association
Bylaws from Active Members of the Association
= Minimum Municipal Obligation
The Plan is funded in part by fire state aid and, if necessary, City contributions. The State of Minnesota distributed to
the City $94,308 in fire state aid paid by the City to the Relief Association for the year ended December 31, 2014.
Required employer contributions are calculated annually based on statutory provisions. The City’s statutorily-
required contribution to the plan for the year ended December 31, 2014 was $32,166.
D. Pension Costs
At December 31, 2015, the City reported an asset of $688,067 for the Association’s net pension asset. The net pension
asset was measured as of December 31, 2014, and the total pension liability used to calculate the net pension liability
was determined by an actuarial valuation as of that date.
As a result of its requirement to contribute to the Relief Association, the City reduced expense by $43,568 for the year
ended December 31, 2015. At December 31, 2015, the City reported deferred outflows of resources and deferred
inflows of resources from the following sources:
Description
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Differences between expected and actual economic
experience
$ - $ -
Changes of assumptions
Net difference between projected and actual earnings on
pension plan investments
102,277 -
City contributions subsequent to the measurement date 36,889 -
Total $ 139,166 $ -
75
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
The City contributions to the Association subsequent to the measurement date of $36,889, reported as deferred
outflows of resources, will be recognized as a reduction of the net pension liability in the year ended December 31,
2016. Other amounts reported as deferred outflows and inflows of resources related to the Association’s pension will
be recognized in pension expense as follows:
Year Ended December 31
Pension
Expense
Amount
2016 25,569
2017 25,569
2018 25,569
2019 25,570
2020 -
Thereafter -
E. Actuarial Assumptions
The actuarial total pension liability was determined as of December 31, 2014, using the following actuarial
assumptions, applied to all periods included in the measurement:
The long-term expected rate of return on pension plan investments was determined using a building-block method in
which best-estimates of expected future real rates of return (expected returns, net of pension plan investment expense
and inflation) are developed for each major asset class. These asset class estimates are combined to produce the
portfolio long-term expected rate of return by weighting the expected future real rates of return by weighting the
expected future real rates of return by the current asset allocation percentage (or target allocation, if available) and by
adding expected inflation.
The best-estimate of expected future real rates of return were developed by aggregating data from several published
capital market assumption surveys and deriving a single best-estimate based on the average survey values. These
capital market assumptions reflect both historical market experience as well as diverse views regarding anticipated
future returns. The expected inflation assumption was developed based on an analysis of historical experience blended
ASSUMPTIONS FROM ACTUARIAL REPORT
Valuation Date 12/31/14
Actuarial Cost Method Entry Age Normal
Amortization Method Level Dollar
Closed
Actuarial Assumptions:
Discount Rate 7.50%
Investment Rate of Return 7.50%
20-Year Municipal Bond Yield 4.00%
Age of Service Retirement Age 50
Mortality N/A
Disability None
Withdrawal None
Percent Married N/A
Age Difference N/A
Form of Payment Lump Sum
76
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS, (CONT.)
December 31, 2015
with forward-looking expectations available in market data.
Best estimates of geometric real and nominal rates of return for each major asset class included in the pension plan's
asset allocation as of December 31, 2015 are summarized in the following table:
Allocation at Long-Term
December 31, Expected Expected Nominal
Asset Class 2014 Portfolio Weight Rate of Return
Cash 48.38% 43.00% 8.00%
Fixed Income 49.81%42.00%4.00%
Domestic Equity 0.00%5.00%6.50%
International Equity 1.81%10.00%6.00%
Total Portfolio 100.00%100.00%6.00%
F. Discount Rate
The discount rate used to measure the total pension liability was 7.50%. Assets were projected using expected benefit
payments and expected asset returns. Expected benefit payments were discounted by year using expected assets return
assumption for years in which the assets were sufficient to pay all benefit payments. Any remaining benefit payments
after the trust fund is exhausted are discounted at the municipal bond rate of return. The equivalent single rate is the
discount rate. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to
make all projected future benefit payments of current plan members.
G. Pension Liability Sensitivity
The following presents the City of Eden Prairies proportionate share of the net pension liability of the Association,
calculated using the discount rate of 7.50%, as well as what the Association’s net pension liability would be if it were
calculated using a discount rate that is one percentage point lower (6.50%) or one percentage point higher (8.50%)
than the current rate:
(remainder of page left blank intentionally)
Selected
1% Decrease Discount Rate 1% Increase
Net Pension Liability (Asset) (591,685)$ (688,067)$ (773,359)$
Discount Rate 6.50% 7.50% 8.50%
77
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
H. Plan’s Fiduciary Net Position
Detailed information about the Plan’s fiduciary’s net position is available in a separately-issued report. That report may
be obtained by writing to the Hopkins Fire Relief Association, 1010 First St S, Hopkins, MN 55343.
78
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
12. OTHER POST EMPLOYMENT BENEFIT PLAN
At December 31, 2008, the City adopted Governmental Accounting Standards Board (GASB) Statement No. 45,
Accounting and Financial Reporting by Employers for Postemployment Benefits Other than Pensions. The City
engaged an actuary to determine the City’s liability for postemployment healthcare benefits other than pensions as of
January 1, 2013, for this single employer defined benefit OPEB plan.
1. Plan Description
The City, a single-employer postemployment benefit plan, provides benefits for retirees as required by Minnesota
Statute §471.61 subdivision 2b. Active employees, who were hired prior to July 1, 1993 and have been with the City
for at least ten years and are either (1) age 60 years or older or (2) eligible for full PERA retirement benefits.
Employees retiring by June 30, 2007 will receive full single health and life insurance coverage until age 65;
employees retiring between July 1, 2007 and December 31, 2009 will receive $500 per month towards the cost of
single health and life insurance until age 65; and employees retiring after December 31, 2009 will receive $15 per
month times years of service (maximum of $500 per month) towards the cost of single health and life insurance until
age 65. Currently 16 employees meet those eligibility requirements. As of December 31, 2015 there were
approximately 91 active participants and 17 retired participants receiving benefits from the City’s health plans.
2. Funding Policy
The City funds its OPEB obligation on a pay as you go basis. For fiscal year 2015, the City contributed $245,180 to
the plan. The City's OPEB pension obligation is funded by the General and Enterprise Funds.
3. Annual OPEB Cost and Net OPEB Obligation
The City’s annual other postemployment benefit (OPEB) cost (expense) is calculated based on the annual required
contribution (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement 45.
The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year
and amortize any un-funded actuarial liabilities over a period not to exceed thirty years. The following table shows
the components of the City’s annual OPEB cost for the year, the amount actually paid from the plan, and changes in
the City’s net OPEB obligation.
Annual Required Contribution $ 204,517
Interest on Net OPEB Obligation 10,019
Adjustment to Annual Required Contribution (13,372)
Annual OPEB Cost (Expense) 201,164
Contributions Made (245,180)
Increase in Net OPEB Obligation (44,016)
Net OPEB Obligation - Beginning of Year 222,655
Net OPEB Obligation - End of Year $ 178,639
79
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
The City’s annual OPEB cost, the percentage of the annual OPEB cost contributed to the plan, and the net OPEB
obligation for 2015:
Percentage
Fiscal Annual of Annual Net
Year OPEB OPEB Cost OPEB
Ended Cost Contributed Obligation
12/31/2013 $ 201,090 85.1 % $ 229,026
12/31/2014 200,416 103.2 % 222,653
12/31/2015 201,164 121.9 % 178,639
4. Funded Status and Funding Progress
As of January 1, 2013, the most recent actuarial valuation date, the City’s unfunded actuarial accrued liability
(UAAL) was $2,029,907. The annual payroll for active employees covered by the plan in the actuarial valuation was
$6,583,173 for a ratio of UAAL to covered payroll of 30.83%.
Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about
the probability of occurrence of events far into the future. Examples include assumptions about future employment,
mortality, and healthcare cost trends. Amounts determined regarding the funded status of the plan and the annual
required contributions of the employer are subject to continual revision as actual results are compared with past
expectations and new estimates are made about the future. The schedule of funding progress, presented as required
supplementary information following the notes to the financial statements, presents multiyear trend information about
whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued
liabilities for benefits.
5. Actuarial Methods and Assumptions
Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by
the employer and plan members) and include the types of benefits provided at the time of each valuation and the
historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial
methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in
actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the
calculations.
In the January 1, 2013 actuarial valuation, the projected unit credit actuarial cost method was used. The actuarial
assumptions included a 4.5% investment rate of return (net of administrative expenses), which is a blended rate of the
expected long-term investment returns on plan assets and on the employer’s own investments calculated based on the
funded level of the plan at the valuation date. The initial healthcare trend rate was 7.5%, reduced by decrements to
an ultimate rate of 5% after six years. Both rates include a 2.5% inflation assumption. The UAAL is being
amortized over 30 years (2013 - 2037) as a level percentage of projected payrolls on an closed basis.
13. REHABILITATION LOANS RECEIVABLE
The City makes rehabilitation loans to residential and commercial entities within the City. Residential loans are
made for 20 year periods at 3% interest. A mortgage against the property improved is required and City staff is
responsible to follow-up any delinquent accounts. Loan repayments are made to Matrix Financial Services, a loan
service bureau, which charges a fee of $5.95 per month per loan. Principal and interest are forwarded to the City
monthly with loan collection and loan status reports. Rehabilitation loan activity is a function of the Economic
Development Fund, and the Hennepin County CDBG Funds. Loans become due in full upon sale of property.
Rehabilitation loans receivable amounted to $ 43,893 at December 31, 2015 and are recorded in the Hennepin
County CDBG non-major special revenue funds.
80
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
14. CLAIMS AND LITIGATION
The City had the usual and customary types of miscellaneous claims pending at year-end, which are of a minor nature
and usually all covered by insurance carried for that purpose. The City carries a $1,000,000 Public Official Liability
Insurance policy with public entity and employee endorsement.
15. 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 participates in a public entity risk pool to mitigate
its exposure to these risks. Workers compensation and property and liability coverage are provided through a pooled
self-insurance plan with other cities. Settled claims have not exceeded insurance coverage in any of the past three
fiscal years and no significant reductions in coverage from the prior year. The City pays an annual premium based
on prior claims history for its workers compensation coverage. The public entity risk pool is responsible for the
payment of all associated claims. The City has a $20,000 deductible per occurrence with a maximum per year out of
pocket of $40,000, for its property and liability coverage. The public entity risk pool is responsible for all losses in
excess of $20,000 per occurrence and all losses occurring after the $40,000 maximum City out of pocket costs.
(remainder of page left blank intentionally)
81
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
16. PRIOR PERIOD ADJUSTMENT
During the fiscal year ended December 31, 2015, the City adopted GASB Statement No. 68, Accounting and
Financial Reporting for Pensions and the related Statement No. 71. As a result, the City’s net position as of December
31, 2014 has been restated to reflect the recognition of the City’s proportionate share of the Public Employees’
Retirement Association of Minnesota General Employees’ Retirement Fund (GERF) and Public Employees’ Police
and Fire Fund’s (PEPFF) net pension liability and related deferred inflows and outflows of resources as well as the
Hopkins Fire Relief Association’s net pension asset and related deferred inflows and outflows of resources.
Governmental
Activities
Business-Type
Activities Water Sewer
Net Position, December 31, 2014, as
Previously Reported $ 50,142,412 $ 18,892,140 $ 3,811,086 $ 3,212,016
Cumulative Affect of Application of
GASB 68, Net Pension Liability (6,273,405) (818,783) (295,496) (162,730)
Cumulative Affect of Application of
GASB 68, Net Pension Asset 714,610 - - -
Cumulative Affect of Application of
GASB 71, Deferred Outflow of
Resources for City Contributions Made
to the Plan During Fiscal Year Ending
December 31, 2014 389,985 37,223 13,434 7,398
Net Position, December 31, 2014, as
Restated $ 44,973,602 $ 18,110,580 $ 3,529,024 $ 3,056,684
Storm Sewer Refuse Pavilion Total
Net Position, December 31, 2014, as
Previously Reported $ 6,603,658 $ 1,325,440 $ 2,054,142 $ 69,034,552
Cumulative Affect of Application of
GASB 68, Net Pension Liability (35,146) (166,325) (159,086) (7,092,188)
Cumulative Affect of Application of
GASB 68, Net Pension Asset - - - 714,610
Cumulative Affect of Application of
GASB 71, Deferred Outflow of
Resources for City Contributions Made
to the Plan During Fiscal Year Ending
December 31, 2014 1,598 7,561 7,232 427,208
Net Position, December 31, 2014, as
Restated $ 6,570,110 $ 1,166,676 $ 1,902,288 $ 63,084,182
Non-major Funds
82
City of Hopkins, Minnesota
NOTES TO FINANCIAL STATEMENTS (CONT.)
December 31, 2015
17. SUBSEQUENT EVENT
At the May 17, 2016 meeting, the City Council approved issuance and sale of $4,480,000 General Obligation
Improvement Bonds, Series 2016A and $1,630,000 General Obligation Tax Abatement Bonds, Series 2016B.
Proceeds from the 2016A bonds will be used for the City’s 2016 road construction project and proceeds from the
2016B bonds will be used for various park improvements and improvements to the City owned parking ramp. Both
issuances were offered for sale on June 21, 2016.
83
REQUIRED SUPPLEMENTARY
INFORMATION
84
City of Hopkins, Minnesota
REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2015
1. OTHER POSTEMPLOYMENT BENEFITS PLAN
Schedule of Funding Progress:
Actuarial UAAL as a
Actuarial Accrued Percentage
Actuarial Value of Liability Unfunded Funded Covered of Covered
Valuation Assets (AAL) AAL Ratio Payroll Payroll
Date (a) (b) (b-a) (a/b) (c) ((b-a)/c)
01/01/07 $ - $ 2,297,909 $ 2,297,909 - $ 5,621,587 41 %
01/01/10 - 2,145,617 2,145,617 - 6,244,081 34 %
01/01/13 - 2,029,907 2,029,907 - 6,583,173 31 %
2. SCHEDULE OF PROPORTIONATE SHARE OF NET PENSION LIABILITY
PUBLIC EMPLOYEES GENERAL EMPLOYEES RETIREMENT FUND
Last Ten Years*
PERA - General Employees Retirement Fund
Fiscal
Year
Ending
Employer's
Proportionate
(Percentage) of
the
Net Pension
Employer's
Proportionate
Share
(Amount) of
the Net Pension
Liability
(Asset)
(a)
Employer's
Covered
Payroll**
(b)
Employer's
Proportionate
Share of the
Net Pension
Liability
(Asset) as a
Percentage of
its Covered
Payroll
Plan Fiduciary
Net Position
as a Percentage
of the Total
Pension
Coverage
June 30, 2015 0.0831% $4,306,673 $4,802,000 89.68% 78.20%
PERA - Public Employees Police and Fire Fund
Fiscal
Year
Ending
Employer's
Proportionate
(Percentage) of
the
Net Pension
Employer's
Proportionate
Share
(Amount) of
the Net Pension
Liability
(Asset)
(a)
Employer's
Covered
Payroll**
(b)
Employer's
Proportionate
Share of the
Net Pension
Liability
(Asset) as a
Percentage of
its Covered
Payroll
Plan Fiduciary
Net Position
as a Percentage
of the Total
Pension
Coverage
June 30, 2015 - $3,056,469 $2,540,691 120.30% 86.60%
Notes to schedules
* This schedule is provided prospectively beginning with the fiscal year ended December 31, 2015.
** For purposes of this schedule, covered payroll is defined as "pensionable wages".
85
City of Hopkins, Minnesota
REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2015
3. SCHEDULES OF THE CITY'S CONTRIBUTIONS
Last Ten Years*
PERA - General Employees Retirement Fund
Fiscal
Year
Ending
Statutorily
Required
Contributions
(a)
Contributions
in Relation to
the Statutorily
Required
Contributions
(b)
Contribution
Deficiency
(Excess)
(a-b)
Covered
Payroll **
(d)
Contributions as a
Percentage of
Covered Payroll
(b/d)
December 31, 2015 $360,150 ($360,150) - $4,802,000 7.50%
PERA - Public Employees Police and Fire Fund
Fiscal
Year
Ending
Statutorily
Required
Contributions
(a)
Contributions
in Relation to
the Statutorily
Required
Contributions
(b)
Contribution
Deficiency
(Excess)
(a-b)
Covered
Payroll **
(d)
Contributions as a
Percentage of
Covered Payroll
(b/d)
December 31, 2015 $411,592 ($411,592) - $2,540,691 16.20%
Notes to schedules
* This schedule is provided prospectively beginning with the fiscal year ended December 31, 2015.
** For purposes of this schedule, covered payroll is defined as "pensionable wages".
86
City of Hopkins, Minnesota
REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2015
4. SCHEDULE OF THE CITY'S CONTRIBUTION TO THE HOPKINS FIRE RELIEF FUND
Last Ten Years
Fiscal
Year
Ending
December 31
Statutorily
Required
Contributions
(a)
Contributions
in Relation to
the Statutorily
Required
Contributions
(b)
Contribution
Deficiency
(Excess)
(a-b)
2015 $ 36,889 $ (36,889) $ -
2014 32,166 (32,166) -
2013 32,166 (32,166) -
2012 32,166 (32,166) -
2011 32,166 (32,166) -
2010 189,825 (189,825) -
2009 32,166 (32,166) -
2008 32,166 (32,166) -
2007 32,166 (32,166) -
2006 32,166 (32,166) -
87
City of Hopkins, Minnesota
REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2015
5. SCHEDULE OF PROPORTIONATE SHARE OF NET PENSION LIABILITY –
HOPKINS FIRE RELIEF
88
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102
City of Hopkins
Combining Statement of Revenues, Expenditures
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended December 31, 2015
Debt Service Funds
Tax Increment
Bonds of 1996C
Refunding
Bonds of 2005A
Taxable Tax
Increment
Bonds of 1997
Refunding
Bonds of 2005B
Capital
Improvement
Bonds of
2007A
Improvement
Revolving
Bonds of
2007B
Housing
Improvement
Bonds of 1999A
Refunding
Bonds of 2009B
Revenues
Property taxes $- $- $- $- $-
Special assessments - 174,517 -- 145,339
Investment earnings 1,125 4,575 -549 3,258
Total Revenues 1,125 179,092 -549 148,597
Expenditures
Current:
General government 728 1,542 3,000 3,000 1,163
Debt Service:
Principal retirement 100,000 120,000 - 885,000 90,000
Interest and fiscal fees 6,513 24,597 138,251 19,056 27,352
Total Expenditures 107,241 146,139 141,251 907,056 118,515
Excess (deficiency) of revenues
over expenditures (106,116)32,953 (141,251)(906,507)30,082
Other Financing Sources (Uses)
Improvement bonds issued -----
Premium on improvement bonds -----
Payment to bond escrow agent -- (6,360,000)--
Transfer in 37,000 - 390,240 7,234 -
Transfer out --(72,500)--
Total Other Financing Sources (Uses)37,000 -(6,042,260)7,234 -
Net change in fund balances (69,116)32,953 (6,183,511)(899,273)30,082
Fund balance (deficit) - January 1 180,861 463,843 6,183,511 899,273 338,025
Fund balance (deficit) - December 31 $111,745 $496,796 $-$-$368,107
103
City of Hopkins
Combining Statement of Revenues, Expenditures
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended December 31, 2015
Debt Service Funds
Improvement
Revolving
Bonds of
2010A
Tax
Increment
Bonds of 2002
Refunding
Bonds of
2010B
Capital
Improvement
Bonds of 2012A
Equipment
Certificates of
2012B
Improvement
Bonds of 2012B
Revenues
Property taxes $ 81,330 $- $ 217,619 $ 95,428 $ 69,339
Special assessments 85,181 --- 121,472
Investment earnings 1,092 1,188 190 -4,647
Total Revenues 167,603 1,188 217,809 95,428 195,458
Expenditures
Current:
General government 747 761 704 648 1,009
Debt Service:
Principal retirement 170,000 140,000 165,000 80,000 190,000
Interest and fiscal fees 54,221 31,515 18,626 13,240 60,744
Total Expenditures 224,968 172,276 184,330 93,888 251,753
Excess (deficiency) of revenues
over expenditures (57,365)(171,088)33,479 1,540 (56,295)
Other Financing Sources (Uses)
Improvement bonds issued -----
Premium on improvement bonds -----
Payment to bond escrow agent -----
Transfer in 61,358 188,000 ---
Transfer out -----
Total Other Financing Sources (Uses)61,358 188,000 ---
Net change in fund balances 3,993 16,912 33,479 1,540 (56,295)
Fund balance (deficit) - January 1 245,176 231,695 161,407 7,376 591,832
Fund balance (deficit) - December 31 $249,169 $248,607 $194,886 $8,916 $535,537
104
City of Hopkins
Combining Statement of Revenues, Expenditures
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended December 31, 2015
Debt Service Funds
Improvement
Bonds of 2013A
Improvement
Bonds of 2014A
Refunding
Bonds of 2014B
SROP Bonds of
2015A
Tax Abatement
Bonds of 2015B
Revenues
Property taxes $ 74,646 $ 88,139 $ 872,833 $- $-
Special assessments 73,289 37,408 37,834 18,583 -
Investment earnings 3,897 402 793 311 249
Total Revenues 151,832 125,949 911,460 18,894 249
Expenditures
Current:
General government 939 706 999 75,312 74,255
Debt Service:
Principal retirement 110,000 ----
Interest and fiscal fees 39,400 54,943 89,221 490 345
Total Expenditures 150,339 55,649 90,220 75,802 74,600
Excess (deficiency) of revenues
over expenditures 1,493 70,300 821,240 (56,908)(74,351)
Other Financing Sources (Uses)
Improvement bonds issued --- 4,100,000 2,940,000
Premium on improvement bonds ---60,472 29,131
Payment to bond escrow agent -----
Transfer in -72,416 72,500 --
Transfer out -- (252,474) (4,022,048) (2,844,185)
Total Other Financing Sources (Uses)-72,416 (179,974)138,424 124,946
Net change in fund balances 1,493 142,716 641,266 81,516 50,595
Fund balance (deficit) - January 1 432,436 49,362 252 --
Fund balance (deficit) - December 31 $433,929 $192,078 $641,518 $81,516 $50,595
105
City of Hopkins
Combining Statement of Revenues, Expenditures
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended December 31, 2015
Debt Service
Funds
Tax Increment
Revenue Bonds
of 2015C Total
Revenues
Property taxes $- $ 1,499,334
Special assessments - 693,623
Investment earnings 182 22,458
Total Revenues 182 2,215,415
Expenditures
Current:
General government 62,806 228,319
Debt Service:
Principal retirement - 2,050,000
Interest and fiscal fees - 578,514
Total Expenditures 62,806 2,856,833
Excess (deficiency) of revenues
over expenditures (62,624)(641,418)
Other Financing Sources (Uses)
Improvement bonds issued 4,340,000 11,380,000
Premium on improvement bonds 132,269 221,872
Payment to bond escrow agent (3,927,887) (10,287,887)
Transfer in - 828,748
Transfer out - (7,191,207)
Total Other Financing Sources (Uses)544,382 (5,048,474)
Net change in fund balances 481,758 (5,689,892)
Fund balance (deficit) - January 1 - 9,785,049
Fund balance (deficit) - December 31 $481,758 $4,095,157
106
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107
City of Hopkins
Statement of Revenues, Expenditures
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended December 31, 2015
Special Revenue Debt Service Capital Projects
Total Nonmajor
Governmental
Funds
Revenues
Property taxes $- $ 1,499,334 $ 52,311 $ 1,551,645
Tax increments 323,341 --323,341
Special assessments -693,623 -693,623
Intergovernmental 98,112 -600,766 698,878
Charges for services 194,187 --194,187
Fines 16,778 --16,778
Investment earnings 19,034 22,458 33,402 74,894
Other miscellaneous revenues 567,207 -294,364 861,571
Total Revenues 1,218,659 2,215,415 980,843 4,414,917
Expenditures
Current:
General government 143,972 228,319 115,459 487,750
Public safety 157,940 --157,940
Highways and streets 51,947 -658,387 710,334
Urban redevelopment and housing 145,717 --145,717
Culture and recreation 362,844 -88,803 451,647
Debt service:
Principal retirement - 2,050,000 - 2,050,000
Interest and fiscal fees 17,615 578,514 -596,129
Capital outlay 95,875 - 2,474,187 2,570,062
Total Expenditures 975,910 2,856,833 3,336,836 7,169,579
Excess (deficiency) of revenues
over expenditures 242,749 (641,418)(2,355,993)(2,754,662)
Other Financing Sources (Uses)
Improvement bonds issued - 11,380,000 - 11,380,000
Premium on improvement bonds -221,872 -221,872
Payment to bond escrow agent - (10,287,887)- (10,287,887)
Transfer in 35,910 828,748 2,198,079 3,062,737
Transfer out (254,744) (7,191,207)- (7,445,951)
Total Other Financing Sources (Uses)(218,834)(5,048,474)2,198,079 (3,069,229)
Net change in fund balances 23,915 (5,689,892)(157,914)(5,823,891)
Fund balance (deficit) - January 31 400,718 9,785,049 1,223,287 11,409,054
Fund balance (deficit) - December 31 $424,633 $4,095,157 $1,065,373 $5,585,163
108
City of Hopkins
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Nonmajor Special Revenue Funds
State Chemical Assessment
For the Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Intergovernmental $ 45,000 $ 45,000 $ 83,112 $ 38,112
Other miscellaneous revenues --16,101 16,101
Total Revenues 45,000 45,000 99,213 54,213
Expenditures
Current:
Public safety 45,000 45,000 101,131 (56,131)
Total Expenditures 45,000 45,000 101,131 (56,131)
Net change in fund balance $-$-(1,918)$(1,918)
Fund balance (deficit) - January 1 -
Fund balance (deficit) - December 31 $ (1,918)
109
City of Hopkins
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Nonmajor Special Revenue Funds
Real Estate Purchases & Sales
For the Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Investment earnings $- $- $ 2,755 $ 2,755
Total Revenues --2,755 2,755
Expenditures
Public safety --35 (35)
Total Expenditures --35 (35)
Excess (deficiency) of revenues over expenditures --2,720 2,720
Other Financing Sources (Uses)
Transfer out (124,500) (124,500) (130,824)(6,324)
Total Other Financing Sources (Uses)(124,500)(124,500)(130,824)(6,324)
Net change in fund balance $(124,500)$(124,500)(128,104)$(3,604)
Fund balance (deficit) - January 1 128,104
Fund balance (deficit) - December 31 $-
110
City of Hopkins
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Nonmajor Special Revenue Funds
Parking
For the Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Charges for services $ 74,000 $ 74,000 $ 119,577 $ 45,577
Fines 22,000 22,000 16,778 (5,222)
Investment earnings 500 500 2,406 1,906
Total Revenues 96,500 96,500 138,761 42,261
Expenditures
Current:
Public safety 62,550 62,550 56,774 5,776
Highways and streets 31,854 31,854 51,947 (20,093)
Capital Outlay 45,000 45,000 95,875 (50,875)
Total Expenditures 139,404 139,404 204,596 (65,192)
Net change in fund balance $(42,904)$(42,904)(65,835)$(22,931)
Fund balance (deficit) - January 1 129,579
Fund balance (deficit) - December 31 $ 63,744
111
City of Hopkins
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Nonmajor Special Revenue Funds
Communications
For the Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Investment earnings $ 1,500 $ 1,500 $ 6,046 $ 4,546
Other miscellaneous revenues 235,000 235,000 267,726 32,726
Total Revenues 236,500 236,500 273,772 37,272
Expenditures
Current:
General government 122,344 122,344 143,972 (21,628)
Capital Outlay 35,000 35,000 -35,000
Total Expenditures 157,344 157,344 143,972 13,372
Excess (deficiency) of revenues over expenditures 79,156 79,156 129,800 50,644
Other Financing Sources (Uses)
Transfer out (86,920)(86,920)(86,920)-
Total Other Financing Sources (Uses)(86,920)(86,920)(86,920)-
Net change in fund balance $(7,764)$(7,764)42,880 $50,644
Fund balance (deficit) - January 1 490,071
Fund balance (deficit) - December 31 $ 532,951
112
City of Hopkins
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Nonmajor Special Revenue Funds
Depot Coffee House
For the Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Intergovernmental $ 15,000 $ 15,000 $ 15,000 $-
Charges for services 70,000 70,000 74,610 4,610
Other miscellaneous revenues 248,000 248,000 276,943 28,943
Total Revenues 333,000 333,000 366,553 33,553
Expenditures
Current:
Culture and recreation 333,359 333,359 362,844 (29,485)
Total Expenditures 333,359 333,359 362,844 (29,485)
Excess (deficiency) of revenues over expenditures (359)(359)3,709 4,068
Other Financing Sources (Uses)
Transfer in 10,000 10,000 10,000 -
Total Other Financing Sources (Uses)10,000 10,000 10,000 -
Net change in fund balance $9,641 $9,641 13,709 $4,068
Fund balance (deficit) - January 1 (24,421)
Fund balance (deficit) - December 31 $ (10,712)
113
City of Hopkins
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Nonmajor Special Revenue Funds
Tax Increment District Entertainment District
For the Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Tax increments $ 58,000 $ 58,000 $ 58,173 $173
Investment earnings 100 100 1,687 1,587
Total Revenues 58,100 58,100 59,860 1,760
Expenditures
Current:
Urban redevelopment and housing 3,000 3,000 2,722 278
Debt Service:
Interest and fiscal fees --10,705 (10,705)
Total Expenditures 3,000 3,000 13,427 (10,427)
Net change in fund balance $55,100 $55,100 46,433 $(8,667)
Fund balance (deficit) - January 1 (68,435)
Fund balance (deficit) - December 31 $ (22,002)
114
City of Hopkins
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Nonmajor Special Revenue Funds
Tax Increment District Sonoma
For the Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Tax increments $ 12,000 $ 12,000 $ 12,587 $587
Investment earnings 100 100 15 (85)
Other miscellaneous revenues 7,024 7,024 6,437 (587)
Total Revenues 19,124 19,124 19,039 (85)
Expenditures
Urban redevelopment and housing 2,050 2,050 2,028 22
Debt service:
Interest and fiscal fees 6,910 6,910 6,910 -
Total Expenditures 8,960 8,960 8,938 22
Excess (deficiency) of revenues over expenditures 10,164 10,164 10,101 (63)
Other Financing Sources (Uses)
Transfer in 21,870 21,870 25,910 4,040
Total Other Financing Sources (Uses)21,870 21,870 25,910 4,040
Net change in fund balance $32,034 $32,034 36,011 $3,977
Fund balance (deficit) - January 1 (173,873)
Fund balance (deficit) - December 31 $ (137,862)
115
City of Hopkins
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Nonmajor Special Revenue Funds
Tax Increment District Oaks of Mainstreet
For the Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Tax increments $ 120,000 $ 120,000 $ 133,405 $ 13,405
Investment earnings 1,200 1,200 6,108 4,908
Total Revenues 121,200 121,200 139,513 18,313
Expenditures
Current:
Urban redevelopment and housing 3,821 3,821 3,331 490
Total Expenditures 3,821 3,821 3,331 490
Excess (deficiency) of revenues over expenditures 117,379 117,379 136,182 18,803
Other Financing Sources (Uses)
Transfer out (36,000)(36,000)(37,000)(1,000)
Total Other Financing Sources (Uses)(36,000)(36,000)(37,000)(1,000)
Net change in fund balance $81,379 $81,379 99,182 $17,803
Fund balance (deficit) - January 1 462,689
Fund balance (deficit) - December 31 $ 561,871
116
City of Hopkins
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Nonmajor Special Revenue Funds
5th Ave Flats
For the Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Expenditures
Urban redevelopment and housing $ 2,000 $ 2,000 $ 4,209 $ (2,209)
Debt service:
Total Expenditures 2,000 2,000 4,209 (2,209)
Net change in fund balance $(2,000)$(2,000)(4,209)$(2,209)
Fund balance (deficit) - January 1 (382,738)
Fund balance (deficit) - December 31 $ (386,947)
117
City of Hopkins
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Nonmajor Special Revenue Funds
Tax Increment District Marketplace & Main
For the Year Ended December 31, 2015
Original
Budget
Final
Approved
Budget Actual
Variance with
Final Budget
Over/Under
Revenues
Tax increments $ 105,000 $ 105,000 $ 119,176 $ 14,176
Investment earnings 100 100 17 (83)
Total Revenues 105,100 105,100 119,193 14,093
Expenditures
Current:
Urban redevelopment and housing 101,550 101,550 129,471 (27,921)
Debt service:
Total Expenditures 101,550 101,550 129,471 (27,921)
Net change in fund balance $3,550 $3,550 (10,278)$(13,828)
Fund balance (deficit) - January 1 (208,107)
Fund balance (deficit) - December 31 $ (218,385)
118
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119
City of Hopkins
Combining Statement of Net Position
Nonmajor Enterprise Funds
December 31, 2015
Nonmajor Business-type Activities-Enterprise Funds
Refuse
Utility Pavilion
Housing
Authority Total
Assets
Current assets:
Cash and cash equivalents $ 861,562 $ 20,443 $ 429,101 $ 1,311,106
Taxes receivable -852 -852
Accounts receivable 35,142 48,540 101 83,783
Accrued interest receivable 4,460 --4,460
Due from other governments --19,596 19,596
Prepaid expenses -68 15,538 15,606
Total current assets 901,164 69,903 464,336 1,435,403
Noncurrent assets:
Capital assets, nondepreciable:
Land -- 208,252 208,252
Construction in progress --56,710 56,710
Capital assets, depreciable:
Building and structures 302,727 3,272,851 4,520,947 8,096,525
Distribution system - 125,614 - 125,614
Machinery and equipment 870,398 253,396 51,681 1,175,475
Less accumulated depreciation (591,973) (1,470,853) (3,433,442) (5,496,268)
Total noncurrent assets 581,152 2,181,008 1,404,148 4,166,308
Total Assets 1,482,316 2,250,911 1,868,484 5,601,711
Deferred outflows of resources:
Pensions 23,122 22,116 -45,238
Total Deferred Outflows of Resources 23,122 22,116 -45,238
Liabilities
Current liablilities:
Accounts payable 27,945 14,738 33,442 76,125
Salaries payable 3,405 3,046 -6,451
Due to other funds --39,408 39,408
Due to other governments 7,970 2,949 -10,919
Compensated absences 16,373 20,082 19,640 56,095
Unearned revenue -6,583 -6,583
Accrued interest payable -1,164 -1,164
Revenue bonds - current -20,000 -20,000
Total current liabilities 55,693 68,562 92,490 216,745
Noncurrent liabilities:
Compensated absences 2,125 --2,125
Net OPEB liability --19,094 19,094
Net pension liability 171,527 164,061 - 335,588
Revenue bonds payable (net of unamortized discounts)- 121,829 - 121,829
Total noncurrent liabilities 173,652 285,890 19,094 478,636
Total Liabilities 229,345 354,452 111,584 695,381
Deferred inflows of resources:
Taxes and special assessments -609 -609
Pensions 16,786 16,056 -32,842
Total Deferred Inflows of Resources 16,786 16,665 -33,451
Net Position
Net investment in capital assets 581,152 2,039,179 1,404,148 4,024,479
Unrestricted 678,155 (137,269) 352,752 893,638
Total Net Position $1,259,307 $1,901,910 $1,756,900 $4,918,117
120
City of Hopkins
Combining Statement of Revenues, Expenses and Changes in Net Position
Nonmajor Enterprise Activities
For the Year Ended December 31, 2015
Nonmajor Business-type Activities-Enterprise Funds
Refuse
Utility Pavilion
Housing
Authority
Nonmajor
Enterprise Funds
Total
Operating revenues
Charges for services $ 915,743 $ 392,306 $ 256,636 $ 1,564,685
Other 12,114 5,926 21,249 39,289
Total operating revenues 927,857 398,232 277,885 1,603,974
Operating expenses
Cost of sales and services 678,482 370,959 90,782 1,140,223
Administration 117,989 8,406 343,507 469,902
Depreciation 52,214 80,857 176,029 309,100
Total operating expenses 848,685 460,222 610,318 1,919,225
Operating income (loss)79,172 (61,990)(332,433)(315,251)
Nonoperating revenues (expenses)
Property taxes -64,161 -64,161
Investment earnings 10,503 --10,503
Interest/fiscal agent expense -(2,549)-(2,549)
Intergovernmental grants 27,956 -203,535 231,491
Total nonoperating revenues (expenses)38,459 61,612 203,535 303,606
Income (loss) before contributions and transfers 117,631 (378)(128,898)(11,645)
Capital contributions
Transfers (25,000)--(25,000)
Change in net position 92,631 (378)(128,898)(36,645)
Net position - January 1, as previously reported 1,325,440 2,054,142 1,885,798 5,265,380
Prior period adjustment, as restated (see note 16)(158,764)(151,854)-(310,618)
Net position - January 1 1,166,676 1,902,288 1,885,798 4,954,762
Net position - December 31 $1,259,307 $1,901,910 $1,756,900 $4,918,117
121
City of Hopkins
Combining Statement of Cash Flows
Nonmajor Enterprise Funds
For the Year Ended December 31, 2015
Nonmajor Business-type Activities-Enterprise Funds
Nonmajor
Refuse Pavilion/Housing
Enterprise
Funds
Utility Ice Arena Authority Total
Cash Flows from Operating Activities
Receipts from customers and users $ 933,525 $ 383,118 $ 315,997 $ 1,632,640
Receipts from interfund services provided - - 1,414 1,414
Internal activity - payments to other funds - (36,398) - (36,398)
Payments to suppliers (413,915) (124,979) (369,051) (907,945)
Payments to employees (108,161) (84,002) (87,042) (279,205)
Payments for interfund services used (117,989) (8,406) - (126,395)
Net cash used by operating activities 293,460 129,333 (138,682) 284,111
Cash Flows from Noncapital Financing Activities
Intergovernmental grants 24,645 - 203,535 228,180
Taxes - 64,161 - 64,161
Transfers (to) from other funds (25,000) - - (25,000)
Net cash provided (used) by noncapital and related financing activities (355) 64,161 203,535 267,341
Cash Flows from Capital and Related Financing Activities:
Purchases of capital assets (232,515) - - (232,515)
Construction of capital assets - - (44,963) (44,963)
Interest and other payments - (3,016) - (3,016)
Bond payments - (20,000) - (20,000)
Net cash provided (used) by capital and related financing activities (232,515) (23,016) (44,963) (300,494)
Cash Flows From Investing Activities
Interest received 8,224 - - 8,224
Net increase (decrease) in cash and cash equivalents 68,814 170,478 19,890 259,182
Cash and cash equivalents - January 1 (68,658) (170,474) 409,211 170,079
Cash and cash equivalents - December 31 $ 156 $ 4 $ 429,101 $ 429,261
Reconciliation of Cash and Cash Equivalents at End of Year to Cash and
Investments per Statement of Net Position
Ending cash and cash equivalents per cash flow statement $ 156 $ 4 $ 429,101 $ 429,261
Investments 861,406 20,439 - 881,845
Cash and Investments per Statement of Net Position $ 861,562 $ 20,443 $ 429,101 $ 1,311,106
Reconciliation of operating loss to net cash used by operating activities:
Operating income (loss) 79,172 (61,990) (332,433) (315,251)
Adjustments to reconcile operating loss to net cash used by
operating activities:
Depreciation expense 52,214 80,857 176,029 309,100
(Increase) decrease in:
Accounts receivable 5,668 (13,389) 38,112 30,391
Inventory 631 - - 631
Prepaid expense - (2) 970 968
Pensions (deferred outflows) (23,122) (22,116) - (45,238)
Increase (decrease) in:
Accounts, compensated absences and accrued interest payable (10,755) 1,728 (22,774) (31,801)
Due to other funds - (36,398) 1,414 (34,984)
Due to other governments 339 2,251 - 2,590
Unearned revenue - (1,725) - (1,725)
Net pension 172,527 164,061 - 336,588
Pension (deferred inflows) 16,786 16,056 - 32,842
Net cash used by operating activities $ 293,460 $ 129,333 $ (138,682) - 284,111
122
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125
City of Hopkins
Combining Statement of Cash Flows
Internal Service Funds
For the Year Ended December 31, 2015
Equipment Employee Insurance
Replacement Benefits Risk Totals
Cash Flows from Operating Activities
Receipts from customers and users $ - $ - $ 73,245 $ 73,245
Receipts from interfund services provided 376,884 - - 376,884
Payments to suppliers 151,054 835 (62,291) 89,598
Payments for interfund services used (7,357) (30,777) (671) (38,805)
Net cash provided (used) by operating activities 520,581 (29,942) 10,283 500,922
Cash Flows from Capital and Related Financing Activities:
Purchases of capital assets (1,201,924) - - (1,201,924)
Proceeds from sales of capital assets 27,535 - - 27,535
Interest and other payments (8,964) - - (8,964)
Capital lease payments (45,252) - - (45,252)
Net cash used by capital and related
financing activities (1,228,605) - - (1,228,605)
Cash Flows From Investing Activities 5,536 10,035 2,622 18,193
Net increase (decrease) in cash and cash equivalents (702,488) (19,907) 12,905 (709,490)
Cash and Cash Equivalents - January 1 702,514 20,081 (12,855) 709,740
Cash and Cash Equivalents - December 31 $ 26 $ 174 $ 50 $ 250
Reconciliation of Cash and Cash Equivalents at End of Year
to Cash and Investments per Statement of Net Position
Ending cash and cash equivalents per cash flow statement $ 26 $ 174 $ 50 $ 250
Investments 146,024 965,305 279,528 1,390,857
Cash and Investments per Statement of Net Position $ 146,050 $ 965,479 $ 279,578 $ 1,391,107
Reconciliation of operating income (loss) to net
cash provided (used) by operating activities:
Operating income (loss)$ (458,886) $ - $ 66,027 $ (392,859)
Adjustments to reconcile operating income (loss) to
net cash provided (used) by operating activities:
Depreciation expense 474,041 - - 474,041
(Increase) decrease in:
Accounts receivable - - - -
Due from other funds - - - -
Increase (decrease) in:
Accounts, compensated absences and accrued intereset
payable 505,426 (29,942) (55,744) 419,740
Net Cash Provided (Used) by Operating Activities $ 520,581 $ (29,942)$ 10,283 $ 500,922
126
CITY OF HOPKINS, MINNESOTA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED DECEMBER 31, 2013
SECTION III
STATISTICAL SECTION
127
128
CITY OF HOPKINS, MINNESOTA
STATISTICAL SECTION
This part of the City of Hopkins’ comprehensive annual financial report presents detailed
information as a context for understanding what the information in the financial statements, note
disclosures, and the required supplementary information says about the city’s overall financial
health.
Contents Page
Financial Trends 130
These schedules contain trend information to help the reader understand how the
city’s financial performance and well-being have changed over time.
Revenue Capacity 134
These schedules contain information to help the reader assess the factors affecting
the city’s ability to generate its property and sales taxes.
Debt Capacity 138
These schedules present information to help the reader assess the affordability of the
city’s current levels of outstanding debt and the city’s ability to issue additional debt in
the future.
Demographic and Economic Information 143
These schedules offer demographic and economic indicators to help the reader
understand the environment within which the city’s financial activities take place and
to help make comparisons over time and with other governments.
Operating Information 145
These schedules contain information about the city’s operations and resources to
help the reader understand how the city’s financial information relates to the services
the city provides and the activities it performs.
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive
annual financial reports for the relevant year.
129
City of Hopkins
Net Position by Component,
Last Ten Fiscal Years
(accrual basis of accounting)
Fiscal Year
2006 2007 2008 2009
Governmental activities
Net investment in capital assets $ 25,315,084 $ 28,941,120 $ 30,769,922 $ 32,759,480
Restricted 6,189,025 13,879,837 10,074,674 11,952,783
Unrestricted 10,849,585 2,006,418 3,663,772 10,022
Total governmental activities net position $ 42,353,694 $ 44,827,375 $ 44,508,368 $ 44,722,285
Business-type activities
Net investment in capital assets $ 14,612,000 $ $ 15,688,414 $ $ 16,081,209 $ $ 14,994,311
Restricted - - - -
Unrestricted 1,917,071 733,298 280,214 1,655,927
Total business-type activities net position $ 16,529,071 $ 16,421,712 $ 16,361,423 $ 16,650,238
Primary Government
Net investment in capital assets $ 39,927,084 $ 44,629,534 $ 46,851,131 $ 47,753,791
Restricted 6,189,025 13,879,837 10,074,674 11,952,783
Unrestricted 12,766,656 2,739,716 3,943,986 1,665,949
Total primary government net position $ 58,882,765 $ 61,249,087 $ 60,869,791 $ 61,372,523
130
Schedule 1
Fiscal Year
2010 2011 2012 2013 2014 2015
$ 32,823,582 $ 31,666,432 $ 31,891,229 $ 30,666,268 $ 31,272,253 $ 32,609,356
8,613,114 8,250,360 8,684,347 10,014,203 16,967,889 20,016,574
3,590,101 6,348,703 7,854,941 9,575,287 1,902,270 (9,447,813)
$ 45,026,797 $ 46,265,495 $ 48,430,517 $ 50,255,758 $ 50,142,412 $ 43,178,117
$ 16,279,028 $ 17,075,284 $ 16,405,495 $ 16,621,198 $ 16,937,928 $ 17,893,856
- - - - - -
1,073,329 731,674 2,262,236 2,469,397 1,954,212 1,419,018
$ 17,352,357 $ 17,806,958 $ 18,667,731 $ 19,090,595 $ 18,892,140 $ 19,312,874
$ 49,102,610 $ 48,741,716 $ 48,296,724 $ 47,287,466 $ 48,210,181 $ 50,503,212
8,613,114 8,250,360 8,684,347 10,014,203 16,967,889 20,016,574
4,663,430 7,080,377 10,117,177 12,044,684 3,856,482 (8,028,795)
$ 62,379,154 $ 64,072,453 $ 67,098,248 $ 69,346,353 $ 69,034,552 $ 62,490,991
131
City of Hopkins
Changes in Net Position,
Last Ten Fiscal Years
(accrual basis of accounting)
Fiscal Year
2006 2007 2008 2009 2010 2011
Expenses
Governmental activities:
General Government $ 1,402,448 $ 1,679,630 $ 1,721,624 $ 1,679,040 $ 1,693,275 $ 1,719,970
Public Safety 5,039,235 5,665,419 6,171,249 6,249,519 6,243,813 6,213,995
Health and Welfare 176,275 188,483 236,858 278,002 180,895 170,018
Highways and Streets 2,380,252 2,870,426 3,154,762 3,069,078 3,062,507 3,332,067
Urban Development and Housing 1,022,476 1,903,295 1,037,927 1,690,861 1,914,779 2,859,900
Culture and Recreation 1,123,334 1,277,539 1,565,184 1,482,349 1,505,513 1,644,834
Interest on long-term debt 1,282,328 1,069,863 1,090,341 1,025,771 895,873 871,902
Total governmental activities expenses 12,426,348 14,654,655 14,977,945 15,474,620 15,496,655 16,812,686
Business-type activities:
Water 1,117,037 1,240,760 1,356,448 1,209,508 1,196,947 1,263,835
Sewer 1,608,116 1,784,001 1,756,489 1,741,115 1,844,309 1,800,126
Storm Sewer 408,252 416,479 417,595 403,231 420,619 407,057
Refuse 714,389 732,239 771,107 786,522 738,398 778,044
Pavilion/Ice Arena 371,845 385,062 411,134 401,598 398,354 416,166
Housing and Redevelopment Authority 525,588 483,944 573,070 528,542 542,324 607,090
Total business-type activities 4,745,227 5,042,485 5,285,843 5,070,516 5,140,951 5,272,318
Total primary government expenses $ 17,171,575 $ 19,697,140 $ 20,263,788 $ 20,545,136 $ 20,637,606 $ 22,085,004
Program Revenues
Governmental activities:
Charges for services:
General Government $ 19,727 $ 38,595 $ 19,239 $ 30,797 $ 17,169 $ 42,112
Public Safety 70,604 219,121 262,194 284,160 124,338 186,611
Health and Welfare 15,817 13,866 16,560 9,265 32,135 41,815
Highways and Streets 60,698 59,791 59,803 42,150 56,902 73,519
Urban Development and Housing 90,727 30,363 - - - 206,916
Culture and Recreation 401,860 397,992 514,592 509,098 560,702 623,147
Operating grants and contributions 1,422,575 2,123,438 1,949,375 2,441,622 1,894,777 2,325,158
Capital grants and contributions 687,552 1,677,841 170,393 745,505 567,370 1,751,464
Total governmental activities program revenues 2,769,560 4,561,007 2,992,156 4,062,597 3,253,393 5,250,742
Business-type activities:
Charges for services:
Water 1,063,361 1,133,248 1,188,610 1,339,390 1,343,153 1,395,306
Sewer 1,645,661 1,427,675 1,474,474 1,598,717 1,812,585 1,838,949
Storm Sewer 735,183 724,778 725,029 800,843 803,889 803,417
Refuse 687,127 692,222 713,270 821,628 852,215 939,421
Pavilion/Ice Arena 672,739 459,003 358,645 368,228 363,591 385,748
Housing and Redevelopment Authority 265,277 256,104 348,938 279,860 258,388 255,188
Operating grants and contributions 209,533 299,126 251,885 150,814 216,596 190,442
Capital grants and contributions 1,850 - 394,913 142,691 328,515 28,250
Total business-type activities program revenues 5,280,731 4,992,156 5,455,764 5,502,171 5,978,932 5,836,721
Total primary government program revenues $ 8,050,291 $ 9,553,163 $ 8,447,920 $ 9,564,768 $ 9,232,325 $ 11,087,463
Net (Expense)/Revenue
Governmental activities $ (9,656,788) $ (10,093,648) $ (11,985,789) $ (11,412,023) $ (12,243,262) $ (11,561,944)
Business-type activities 535,504 (50,329) 169,921 431,655 837,981 564,403
Total primary government net expense $ (9,121,284)$ (10,143,977)$ (11,815,868)$ (10,980,368)$ (11,405,281)$ (10,997,541)
General Revenues and Other Changes in Net Position
Governmental activities:
Property taxes $ 8,200,725 $ 8,732,711 $ 9,497,650 $ 9,353,966 $ 9,827,813 $ 9,952,156
Tax Increments 990,776 1,050,601 1,186,395 1,636,609 2,147,517 2,239,668
Unrestricted grants and contributions 579,440 564,396 434,163 309,609 306,215 312,519
Unrestricted investment earnings 790,079 754,338 387,424 170,960 121,229 108,956
Gain on sale of capital assets 8,460 9,456 16,150 9,796 - 42,343
Transfers 145,000 145,000 145,000 145,000 145,000 145,000
Total governmental activities 10,714,480 11,256,502 11,666,782 11,625,940 12,547,774 12,800,642
Business-type activities:
Property taxes - - - - - -
Unrestricted investment earnings 102,488 84,670 21,714 12,841 9,138 8,319
Gain on sale of capital assets - 3,300 - 367 - 26,879
Loss on disposal of capital assets - - (106,924) (12,048) - -
Transfers (145,000) (145,000) (145,000) (145,000) (145,000) (145,000)
Total business-type activities (42,512) (57,030) (230,210) (143,840) (135,862) (109,802)
Total primary government $ 10,671,968 $ 11,199,472 $ 11,436,572 $ 11,482,100 $ 12,411,912 $ 12,690,840
Change in Net Position
Governmental activities 1,057,692 1,162,854 (319,007) 213,917 304,512 1,238,698
Business-type activities 492,992 (107,359) (60,289) 287,815 702,119 454,601
Total primary government $ 1,550,684 $ 1,055,495 $ (379,296)$ 501,732 $ 1,006,631 $ 1,693,299
132
Schedule 2
Fiscal Year
2012 2013 2014 2015
$ 2,056,756 $ 2,108,141 $ 2,276,155 $ 6,656,991
6,382,270 6,357,722 6,526,230 6,665,974
136,528 165,649 171,187 185,248
3,226,807 5,845,437 5,709,009 4,542,014
2,362,030 2,000,868 2,247,553 1,249,457
1,726,812 1,857,743 1,941,912 2,068,887
811,914 908,264 711,697 688,155
16,703,117 19,243,824 19,583,743 22,056,726
1,365,542 1,387,807 1,540,940 1,699,540
1,816,058 1,995,886 2,042,106 2,061,180
451,659 448,170 508,686 394,707
862,286 825,329 834,113 848,685
430,082 426,634 460,246 462,771
563,863 615,043 625,667 610,318
5,489,490 5,698,869 6,011,758 6,077,201
$ 22,192,607 $ 24,942,693 $ 25,595,501 $ 28,133,927
$ 40,360 $ 76,477 $ 56,635 $ 82,686
159,642 180,548 118,248 79,415
55,331 57,032 57,235 47,085
78,226 75,840 96,573 127,221
3,444 228 242 220,027
684,018 756,011 740,147 810,762
3,499,465 5,273,474 2,943,889 4,970,313
1,350,147 1,775,717 2,728,416 501,029
5,870,633 8,195,327 6,741,385 6,838,538
1,534,071 1,483,133 1,497,699 1,514,086
2,015,166 1,999,333 2,025,763 2,172,277
801,345 799,603 802,898 805,542
894,534 901,670 906,387 910,672
70,976 65,055 31,914 24,876
255,921 272,109 256,884 277,885
698,769 561,111 795,199 622,332
206,681 144,076 - -
6,477,463 6,226,090 6,316,744 6,327,670
$ 12,348,096 $ 14,421,417 $ 13,058,129 $ 13,166,208
$ (10,832,484) $ (11,048,497) $ (12,842,358) $ (15,218,188)
987,973 527,221 304,986 250,469
$ (9,844,511)$ (10,521,276)$ (12,537,372)$ (14,967,719)
$ 10,354,188 $ 10,565,115 $ 11,207,914 $ 11,038,746
2,332,863 2,002,607 2,700,110 2,920,681
20,724 21,152 20,510 20,510
106,304 105,213 193,546 279,418
38,427 34,651 27,235 27,535
145,000 145,000 493,093 (864,187)
12,997,506 12,873,738 14,642,408 13,422,703
- - - 64,161
9,800 18,788 24,503 23,477
8,000 21,855 - -
- - - -
(145,000) (145,000) (493,093) 864,187
(127,200) (104,357) (468,590) 951,825
$ 12,870,306 $ 12,769,381 $ 14,173,818 $ 14,374,528
2,165,022 1,825,241 1,800,050 (1,795,485)
860,773 422,864 (163,604) 1,202,294
$ 3,025,795 $ 2,248,105 $ 1,636,446 $ (593,191)
133
City of Hopkins
Fund Balances, Governmental Funds,
Last Ten Fiscal Years
(modified accrual basis of accounting)
Fiscal Year
2006 2007 2008 2009
General Fund
Reserved $ 971,517 $ 1,157,142 $ 111,806 $ 196,790
Unreserved 3,345,606 3,304,729 3,884,309 3,930,996
Nonspendable - - - -
Assigned - - - -
Unassigned - - - -
Total general fund $ 4,317,123 $ 4,461,871 $ 3,996,115 $ 4,127,786
All other Governmental Funds
Reserved reported in:
Special Revenue Funds $ 5,625,355 $ 3,137,313 $ 3,189,829 $ 3,528,529
Capital Projects Funds - - - -
Debt Service Funds 2,852,655 12,982,623 3,250,202 6,021,748
Unreserved reported in:
Special Revenue Funds 1,539,404 1,070,230 955,772 (24,957)
Capital Projects Funds 1,718,021 1,808,708 1,381,657 1,264,405
Nonspendable - - - -
Restricted - - - -
Committed - - - -
Assigned - - - -
Unassigned - - - -
Total all other governmental funds $ 11,735,435 $ 18,998,874 $ 8,777,460 $ 10,789,725
Total all funds $ 16,052,558 $ 23,460,745 $ 12,773,575 $ 14,917,511
Note: The City began to use new categories of fund balance when it implemented GASB 54 in 2011.
Prior years were not retroactively reclassified.
134
Schedule 3
Fiscal Year
2010 2011 2012 2013 2014 2015
$ 182,211 $ - $ - $ - $ - $ -
4,071,049 - - - - -
- 174,487 196,500 231,608 213,499 227,113
- 591,676 508,767 426,768 339,055 340,189
- 4,266,048 4,488,876 4,823,141 5,184,081 5,439,798
$ 4,253,260 $ 5,032,211 $ 5,194,143 $ 5,481,517 $ 5,736,635 $ 6,007,100
$ 2,844,901 $ - $ - $ - $ - $ -
- - - - - -
4,850,159 - - - - -
590,281 - - - - -
3,572,002 - - - - -
- 2,674,342 1,718,341 1,495 201 204
- 5,823,862 6,312,043 5,199,415 12,683,242 16,720,476
- 926,349 2,679,389 4,509,026 4,574,733 4,882,609
- 2,502,336 4,785,717 3,313,086 4,162,299 1,249,239
- (1,916,865) (2,090,788) (2,011,214) (2,029,619) (1,960,918)
$ 11,857,343 $ 10,010,024 $ 13,404,702 $ 11,011,808 $ 19,390,856 $ 20,891,610
$ 16,110,603 $ 15,042,235 $ 18,598,845 $ 16,493,325 $ 25,127,491 $ 26,898,710
135
City of Hopkins
Changes in Fund Balances, Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
Fiscal Year
2006 2007 2008 2009
Revenues
Property Taxes $ 8,134,915 $ 8,473,516 $ 8,844,113 $ 9,377,127
Tax Increments 990,776 1,050,601 1,186,395 1,636,535
Special Assessments 1,288,437 1,172,977 1,120,741 1,071,406
Intergovernmental 1,036,645 2,115,670 1,053,405 1,220,766
Licenses and Permits 540,120 880,443 744,502 820,031
Charges for Services 631,655 729,365 872,388 875,470
Fines and Forfeits 203,830 215,051 188,003 148,172
Investment Earnings 705,591 638,796 318,074 135,569
Miscellaneous 692,649 851,203 709,915 1,024,879
Total revenues 14,224,618 16,127,622 15,037,536 16,309,955
Expenditures
Current:
General Government 1,366,246 1,597,503 1,590,347 1,552,712
Public Safety 4,994,273 5,290,802 5,779,047 5,888,481
Health and Welfare 176,502 184,541 232,163 273,760
Highways and Streets 1,824,658 2,091,043 2,224,338 2,139,351
Urban Redevelopment and Housing 944,577 1,787,131 935,402 1,586,083
Culture and Recreation 997,987 1,122,891 1,289,323 1,278,108
Capital outlay 3,055,815 5,830,516 1,228,755 1,556,121
Debt Service
Principal 4,926,284 1,610,000 1,705,000 1,805,000
Interest and fiscal charges 1,418,311 1,131,514 1,100,211 1,037,372
Bond Issuance Costs - 81,109 - 34,972
Total expenditures 19,704,653 20,727,050 16,084,586 17,151,960
Excess (deficiency) of revenues
over expenditures (5,480,035) (4,599,428) (1,047,050) (842,005)
Other Financing Sources (Uses)
Sale of Property - - - 341
Proceeds from Issuance of Debt - 11,875,000 - 2,865,000
Discount on Debt - (72,905) - (24,400)
Premium on Debt - 7,520 - -
Refunded bond payment - - - -
Transfer In 5,273,592 14,940,055 1,043,155 1,088,875
Transfer Out (5,278,592) (14,745,055) (898,155) (943,875)
Total other financing sources (uses) (5,000) 12,004,615 145,000 2,985,941
Net change in fund balances $ (5,485,035)$ 7,405,187 $ (902,050)$ 2,143,936
Debt service as a percentage of
noncapital expenditures 38.1 % 18.4 % 18.9 % 18.2 %
Note: Capital outlay has been adjusted for items not shown as capital expenditures on the entity wide statements and reclassified to their
respective expenditure category.
136
Schedule 4
Fiscal Year
2010 2011 2012 2013 2014 2015
$ 9,795,318 $ 10,038,514 $ 10,403,945 $ 10,600,854 $ 11,212,334 $ 11,190,091
2,147,517 2,239,668 2,332,863 2,002,607 2,700,110 2,920,681
1,128,467 1,446,922 1,307,949 1,634,903 1,202,401 1,003,444
1,215,163 1,931,333 1,549,464 3,775,172 3,272,977 2,234,195
623,492 691,962 476,296 649,672 569,585 489,373
800,115 908,106 787,724 884,354 835,960 848,775
138,894 174,303 253,530 251,170 229,807 258,924
106,128 94,409 94,235 94,024 172,012 257,543
589,604 701,683 1,881,347 1,343,592 1,148,505 1,474,048
16,544,698 18,226,900 19,087,353 21,236,348 21,343,691 20,677,074
1,576,676 1,598,885 4,038,893 2,019,932 2,126,004 2,586,582
5,881,633 5,895,640 6,144,206 6,089,431 6,154,320 6,253,424
177,732 168,202 136,169 164,237 167,088 176,248
2,082,853 2,337,018 2,193,209 4,709,377 4,495,659 3,180,023
1,881,610 2,826,172 2,348,694 1,979,001 2,192,453 1,219,526
1,339,695 1,510,024 1,581,886 1,688,876 1,747,614 1,851,741
1,358,792 1,972,143 2,470,049 4,272,737 2,144,714 8,789,979
4,665,000 2,065,000 1,635,000 3,265,000 1,970,000 8,570,000
953,232 852,184 819,238 853,433 709,367 646,387
49,233 - - - - -
19,966,456 19,225,268 21,367,344 25,042,024 21,707,219 33,273,910
(3,421,758) (998,368) (2,279,991) (3,805,676) (363,528) (12,596,836)
- - - - - -
4,515,000 - 5,985,000 1,920,000 8,240,000 18,735,000
(45,150) - (12,830) - - -
- - 65,705 42,010 214,606 425,129
- (215,000) - - - (3,927,887)
7,808,068 1,504,822 4,788,179 2,948,556 9,351,659 8,513,635
(7,663,068) (1,359,822) (4,989,453) (3,210,410) (8,858,566) (9,377,822)
4,614,850 (70,000) 5,836,601 1,700,156 8,947,699 14,368,055
$ 1,193,092 $ (1,068,368)$ 3,556,610 $ (2,105,520)$ 8,584,171 $ 1,771,219
30.20 % 16.90 % 13.00 % 19.80 % 13.70 % 37.60 %
137
Schedule 5
City of Hopkins
Assessed and Actual Value of Taxable Property
Last Ten Fiscal Years
(in thousands of dollars)
Less: Total Taxable
Payable Residential Apartment Commercial Industrial Other Tax-Exempt Market Total Direct
Year Property Property Property Property Property Property Value Tax Rate
2006 $ 1,062,213 $ 256,559 $ 305,233 $ 176,812 $ 288 $ 182,899 $ 1,618,206 48.262
2007 1,080,591 257,658 329,601 188,941 306 182,899 1,674,198 45.862
2008 1,061,645 257,275 352,028 198,808 306 182,899 1,687,163 45.570
2009 1,017,790 266,458 395,842 192,138 1,815 182,899 1,691,144 47.574
2010 922,267 251,418 404,674 168,803 1,503 177,975 1,570,690 49.377
2011 883,348 251,141 397,506 173,349 1,272 179,699 1,526,917 56.463
2012 816,431 252,968 422,769 174,254 1,492 179,699 1,488,215 59.718
2013 867,012 269,812 405,840 174,255 1,492 179,699 1,538,712 63.819
2014 838,714 277,435 419,190 177,413 1,492 179,699 1,534,545 64.290
2015 917,367 313,183 430,897 181,538 1,506 179,699 1,664,792 62.503
Notes:
(1) The direct tax rate is applied to the tax capacity of the property which is calculate by applying a statutory formula to the estimated market value
of the property. The tax capacity is then multiplied by the direct tax rate to determine the city taxes payable on a specific parcel.
(2) Tax exempt property is revalued on a six-year cycle. All other property is revalued on a three year cycle.
138
Schedule 6
City of Hopkins
Direct and Overlapping Property Tax Rates
Last Ten Fiscal Years
(rate per $1,000 of assessed value)
City Direct Rate Overlapping Rates
Fiscal
Year Basic Rate
General
Obligation Debt
Service Total Direct
School
District
Hennepin
County
Metro
Council Other
Total
Overlapping
Total Direct and
Overlapping Tax
Rate
2006 41.300 6.962 48.262 21.565 41.016 2.924 5.180 70.685 118.947
2007 39.574 6.288 45.862 19.019 39.110 2.671 5.746 66.546 112.408
2008 39.237 6.333 45.570 19.218 38.571 2.562 5.984 66.335 111.905
2009 41.346 6.228 47.574 20.080 40.413 2.579 5.834 68.906 116.480
2010 43.121 6.256 49.377 22.944 42.561 2.612 6.825 74.942 124.319
2011 49.638 6.825 56.463 26.456 45.840 2.949 7.540 82.785 139.248
2012 52.238 7.480 59.718 29.270 48.231 3.084 7.827 88.412 148.130
2013 55.902 7.917 63.819 29.730 49.461 3.242 8.241 90.674 154.493
2014 55.743 8.547 64.290 32.358 49.959 3.335 8.716 94.368 158.658
2015 53.884 8.619 62.503 30.340 46.398 3.006 8.094 87.838 150.341
Source: Hennepin County, Minnesota Taxpayer Services Department
Notes: The City's basic rate is determined by the city's annual budget requirements as set by the City Council. Rates for debt service are based on each
year's requirements.
139
Schedule 7
City of Hopkins
Principal Property Taxpayers,
Current Year and Ten Years Ago
2015 2006
Percentage Percentage
of Total of Total
City City
Tax Tax Tax Tax
Capacity Capacity Capacity Capacity
Taxpayer Value Rank Value Value Rank Value
Colfin MIdwest NNN Investment LLC $ 1,754,120 1 8.14 % $ - - - %
Super Valu 976,690 2 4.53 1,009,690 1 5.94
Heines Global REIT 9320 EXCEL 891,430 3 4.14 - - -
Ramsgate Apartments LLC 265,625 4 1.23 246,024 5 1.45
Southwest Real Estate, Inc. 247,356 5 1.15 - - -
Duke Realty Ltd Partnership 243,990 6 1.13 535,229 2 3.15
Interlachen Oaks 217,025 7 1.01 - - -
Hopkins Real Estate, LLC 210,250 8 0.98 - - -
Westside Property Owner LLC 199,250 9 0.93 - - -
Greenfield Apartments, LLP 186,325 10 0.87 193,563 8 1.14
St. Therese Homes - - - 290,145 3 1.71
Alliant Tech - - - 289,485 4 1.70
Westside Villiage - - - 226,494 6 1.33
Gateway Foods - - - 201,890 7 1.19
Christian Salvensen - - - 190,050 9 1.12
EDCO Products, Inc. - - - 184,374 10 1.09
Total $ 5,192,061 24.11 %$ 3,366,944 19.82 %
Total City 2015/2006 tax capacity $ 21,540,415 $ 16,985,332
Source: Hennepin County, Minnesota Assessor's Office
Notes: Tax capacity is a percentage of total market value. For taxes payable in 2011 and forward these class rates are 1% for residential, 1.25% for apartments and
1.5% of first $150,000 with balance at 2.0% for commercial/industrial properties.
140
Schedule 8
City of Hopkins
Property Tax Levies and Collections,
Last Ten Fiscal Years
Collected within the
Taxes Levied for the Fiscal Year Fiscal Year of Levy Total Collections to Date
Percentage
Collections
in Percentage Outstanding Percentage
Fiscal Operating Debt Total Tax of Subsequent of Delinquent of Levy
Year Tax Levy Tax Levy Levy Amount Levy Years Amount Levy Taxes Outstanding
2006 $ 7,221,078 $ 1,217,000 $ 8,438,078 $ 8,282,797 98.2 % $ 121,084 $ 8,403,881 99.6 % $ 34,197 0.4 %
2007 7,598,758 1,207,000 8,805,758 8,620,427 97.9 % 141,204 8,761,631 99.5 % 44,127 0.5 %
2008 7,942,380 1,282,000 9,224,380 8,831,737 95.7 % 133,369 8,965,106 97.2 % 259,274 2.8 % (1)
2009 8,346,114 1,257,000 9,603,114 9,101,458 94.8 % 188,029 9,289,487 96.8 % 313,627 3.2 % (2)
2010 8,733,685 1,267,000 10,000,685 9,533,671 95.3 % 101,357 9,635,028 96.1 % 365,657 3.9 % (3)
2011 9,022,414 1,241,000 10,263,414 9,828,089 95.8 % 196,620 10,024,709 97.4 % 238,705 2.6 % (4)
2012 9,119,591 1,306,400 10,425,991 10,181,764 97.7 % 106,885 10,288,649 99.0 % 137,342 1.0 %
2013 9,219,774 1,306,400 10,526,174 10,319,805 98.0 % 54,142 10,373,947 98.6 % 152,227 1.4 %
2014 9,268,754 1,421,461 10,690,215 10,506,537 98.3 % 23,091 10,529,628 98.5 % 160,587 1.5 %
2014 9,735,801 1,514,844 11,250,645 10,738,982 95.5 % - 10,738,982 95.5 % 511,663 4.5 %
Notes:
(1) In December 2008 the State of MN unalloted $126,391 in Market Value Homestead Credit that is included in the total levy.
Had the City received those funds, outstanding delinquent taxes would be reduced to $132,883 and
the percentage of levy outstanding would be 1.4%.
(2) For the year 2009 State of MN unalloted $246,865 in Market Value Homestead Credit that is included in the total levy.
Had the City received those funds, outstanding delinquent taxes would be reduced to $91,797 and
the percentage of levy outstanding would be 0.9%.
(3) For the year 2010 State of MN unalloted $241,193 in Market Value Homestead Credit that is included in the total levy.
Had the City received those funds, outstanding delinquent taxes would be reduced to $182,339 and
the percentage of levy outstanding would be 1.8%.
(4) For the year 2011 State of MN unalloted $257,696 in Market Value Homestead Credit that is included in the total levy.
Had the City received those funds, outstanding delinquent taxes would be reduced to $153,757 and
the percentage of levy outstanding would be 1.5%.
(5) During the years 2010-2012 there were a significant number of tax court challenges that resulted in taxes being
rebated to taxpayers resulting in higher delinquent taxes for the years 2008-2012.
141
Schedule 9
City of Hopkins
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
Business-Type
Governmental Activities Activities
General HRA Tax Special Total Percentage
Fiscal Obligation Lease Revenue Increment Assessments Capital Revenue Primary of Personal Per
Year Bonds Bonds Bonds Bonds Lease Bonds Government Income Capita
2006 $ 675,000 $ 12,770,000 $ 9,420,000 $ 1,370,000 $ - $ 4,380,000 $ 28,615,000 18.20 % 1,658
2007 10,450,000 12,235,000 8,805,000 3,010,000 - 3,905,000 38,405,000 22.99 % 2,211
2008 9,855,000 2,565,000 8,135,000 2,690,000 425,000 3,410,000 27,080,000 15.32 % 1,545
2009 9,182,508 2,404,246 10,263,615 2,335,972 391,115 6,262,966 30,840,422 16.79 % 1,764
2010 8,566,973 2,281,799 8,290,713 4,861,298 355,556 5,133,954 29,490,293 16.84 % 1,676
2011 7,951,437 2,154,353 7,265,336 4,362,694 318,241 3,843,183 25,895,244 14.21 % 1,472
2012 10,130,650 - 6,733,274 7,262,674 279,083 4,832,960 29,238,641 15.02 % 1,652
2013 9,388,707 - 4,691,998 8,745,591 237,990 6,054,706 29,118,992 14.23 % 1,623
2014 15,092,501 - 4,095,716 10,123,177 194,868 5,488,002 34,994,264 16.94 % 1,901
2015 15,637,818 - 15,519,181 8,757,855 149,616 4,807,632 44,872,102 20.75 % 2,334
Notes: Details regarding the District's outstanding debt can be found in note 9 of the notes to the financial statements.
See the Demographic and Economic Statistics schedule on schedule 14 for personal income
and population data.
142
Schedule 10
City of Hopkins
Ratios of Net General Bonded Debt Outstanding
Last Ten Fiscal Years
General Obligation Bonds
Less Percentage of
General Tax Debt Service Actual Taxable
Fiscal Obligation Improvement Revenue Increment Fund Net Value of Per
Year Bonds Bonds Bonds Bonds Total Balance Bonded Debt Property Capita
2006 $ 13,445,000 $ 1,370,000 $ 17,150,000 $ 9,420,000 $ 41,385,000 $ 2,852,655 $ 38,532,345 2.381% 2,232
2007 13,135,000 3,010,000 16,140,000 8,805,000 41,090,000 12,982,623 28,107,377 1.679% 1,618
2008 12,420,000 2,690,000 5,975,000 8,135,000 29,220,000 3,250,202 25,969,798 1.539% 1,482
2009 11,586,754 2,335,972 8,667,212 10,263,615 32,853,553 6,021,748 26,831,805 1.587% 1,535
2010 10,848,772 4,861,298 7,415,753 8,290,713 31,416,536 4,850,159 26,566,377 1.691% 1,510
2011 10,105,790 4,362,694 5,997,536 7,265,336 27,731,356 4,275,717 23,455,639 1.536% 1,333
2012 10,130,650 7,262,674 4,832,960 6,733,274 28,959,558 4,618,138 24,341,420 1.636% 1,375
2013 9,388,707 8,745,591 6,054,706 4,691,998 28,881,002 3,470,747 25,410,255 1.651% 1,416
2014 15,092,501 10,123,177 5,488,002 4,095,716 34,799,396 10,427,856 24,371,540 1.584% 1,324
2015 15,637,818 8,757,855 4,807,632 15,519,181 44,722,486 12,244,435 32,478,051 1.951% 1,689
Notes:
Details regarding the city's outstanding debt can be found in note 9 of the notes to the financial statements
See the Assessed and Actual Value of Taxable Property schedule 5 for taxable market value of property data
See the Demographic and Economic Statistics schedule 14 for population data
G.O Improvement bonds are included as they are backed by a general tax levy and specuial assessements levied against benefitted properties
G.O. Revenue bonds are included as they are backed by the full taxing authority of the City should revenues fall short of debt requirements
G.O. Tax Increment bonds are included as they are backed by property taxes levied against the properties benefitting from specific development for which the bonds were issued.
143
Schedule 11
City of Hopkins
Direct and Overlapping Governmental Activities Debt
As of December 31, 2015
Estimated
Estimated Share of
Net Debt Percentage Overlapping
Outstanding Applicable (a)Debt
Debt repaid with property taxes:
School Districts:
Hopkins ISD 270 $ 167,575,000 15.90 % $ 26,644,425
St. Louis Park ISD 283 46,420,000 0.39 % 181,038
Other Debt:
Hennepin County 1,037,450,000 1.14 % 11,826,930
Hennepin Suburban Park District 72,145,000 1.56 % 1,125,462
Hennepin Regional RR Authority 34,695,000 1.56 % 541,242
Metropolitan Council 1,485,891,649 0.59 % 8,766,761
Subtotal - overlapping debt 49,085,858
City of Hopkins Direct Debt (b,c) 39,414,616 100 % 39,414,616
Total Direct and Overlapping Debt:$ 88,500,474
Source: Hennepin County, Minnesota Taxpayer Services
Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule shows the
portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the City. This process
recognizes that, when considering the City's ability to issue and repay long-term debt, the entire debt burden borne by the residents and
businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying
the debt, of each overlapping government.
(a) The percentage of overlapping debt applicable is estimated using the taxable market values. Applicable percentages were estimated by
determining the portion of the county's and school district's taxable market value that is within the City's boundaries.
(b) City of Hopkins direct debt includes long-term debt instruments of the City which are bonds and capital leases of the government.
(c) Net Debt Outstanding excludes revenue bonds.
144
Schedule 12
City of Hopkins
Legal Debt Margin Information
Last Ten Fiscal Years
(dollars in thousands)
Legal Debt Margin Calculation for Fiscal Year 2015
Market value $ 1,605,592
Debt limit (3% of market value) 48,168
Debt applicable to limit:
General Obligation Bonds 15,638
Less: Amount set aside for repayment of
general obligation debt (977)
Total net debt applicable to limit 14,661
Legal debt margin $ 33,507
Fiscal Year
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Debt limit $ 31,603 $ 33,252 $ 50,615 $ 50,734 $ 47,121 $ 43,806 $ 42,189 $ 46,161 $ 46,036 $ 48,168
Total net debt applicable to limit 495 9,768 9,263 8,772 10,144 9,549 9,402 8,903 8,736 14,661
Legal debt margin $ 31,108 $ 23,484 $ 41,352 $ 41,962 $ 36,977 $ 34,257 $ 32,787 $ 37,258 $ 37,300 $ 33,507
Total net debt applicable to the limit
as a percentage of debt limit 1.57% 29.38%18.30% 17.29% 21.53% 21.80%22.29% 19.29% 18.98% 30.44%
145
Schedule 13
City of Hopkins
Pledged Revenue Coverage
Last Ten Fiscal Years
Water Revenue Bonds Sewer Revenue Bonds Storm Sewer Revenue Bonds
Fiscal Debt Service Debt Service Debt Service
Year Revenue Principal Interest Coverage Revenue Principal Interest Coverage Revenue Principal Interest Coverage
2006 $ 1,083,675 $ 120,000 $ 75,733 5.54 $ - $ - $ - $ - $ 775,261 $ 330,000 $ 119,445 1.72
2007 1,133,248 125,000 69,699 5.82 - - - - 724,778 350,000 111,605 1.57
2008 1,188,610 130,000 69,699 5.95 - - - - 725,029 365,000 98,846 1.56
2009 1,339,390 140,000 53,440 6.92 - - - - 800,843 365,000 79,437 1.80
2010 1,342,073 1,000,000 56,211 1.27 1,812,585 - 21,501 84.30 803,889 280,000 46,791 2.46
2011 1,395,306 200,000 45,225 5.69 1,838,949 50,000 33,750 21.96 803,417 1,025,000 41,050 0.75
2012 1,534,221 210,000 41,125 6.11 2,150,594 60,000 32,650 23.21 799,938 180,000 26,823 3.87
2013 1,483,283 260,000 50,010 4.78 1,999,483 70,000 34,396 19.15 799,603 205,000 29,585 3.41
2014 1,497,699 265,000 68,704 4.49 2,025,763 70,000 46,193 17.43 802,898 205,000 36,745 3.32
2015 1,514,086 320,000 56,360 4.02 2,172,277 100,000 41,318 15.37 805,542 235,000 29,879 3.04
Notes: Details regarding the City's outstanding debt can be found in Note 9 of the notes to the financial statements.
146
Schedule 14
City of Hopkins
Demographic and Economic Statistics
Last Ten Calendar Years
Personal Per
Income (2)Capita
Fiscal (thousands Personal School Unemployment
Year Population (1)of dollars)Income (2)Enrollment (3)Rate (4)
2006 17,263 $ 156,551 $ 40,267 9,376 3.9
2007 17,367 166,143 42,299 9,318 4.5
2008 17,526 176,035 44,364 9,308 6.4
2009 17,481 182,075 45,459 9,333 6.7
2010 17,591 174,808 43,265 9,241 6.5
2011 17,591 180,988 44,489 9,107 5.5
2012 17,701 193,488 47,136 8,556 5.1
2013 17,939 203,498 49,147 8,555 4.3
2014 18,413 206,789 49,460 8,489 3.8
2015 19,227 216,218 51,244 8,495 3.1
Sources: (1) Metropolitan Council, except for 2010 and 2011 which is per the U.S. Census.
(2) U.S. Department of Commerce Bureau of Economic Analysis data for Minnesota Metropolitan Area
(3) Minnesota Department of Education and is for public and non-public schools in Hopkins School District #270
(4) Minnesota Department of Employment and Economic Development, based on December rates
147
Schedule 15
City of Hopkins
Principal Employers,
Current Year and Ten Years Ago
2015 2006
Percentage Percentage
of Total of Total
Taxpayer Employees Rank Employment Employees Rank Employment
Cargil 4,000 1 26.274 % - - - %
SuperValu 707 2 4.644 1,558 1 13.457
ISD 270 Hopkins (1) 425 3 2.792 501 3 4.327
Thermotech 400 4 2.627 281 4 2.427
U.S. Post Office 314 5 2.063 - - -
Oak Ridge Country Club 212 6 1.393 230 5 1.987
Augustana Chapel View Homes 210 7 1.379 180 6 1.555
US Bank 185 8 1.215 - --
City of Hopkins 132 9 0.867 160 7 1.382
Walser Chrysler Jeep 100 10 0.657 - --
NAPCA International, Inc, - - - 900 2 7.773
Rudy Luther's Hopkins Honda - - - 155 8 1.339
Hopkins Care Center - - - 120 9 1.036
EDCO Products - -- 120 9 1.036
Sungard Financial Systems - -- 112 10 0.967
Total 6,685 43.911 % 4,085 37.286 %
Source: Minnesota Department of Employment and Economic Development, Metropolitan Council and Minnesota State Business Directory
Notes:
(1) Includes total number of employees located in facilities throughout Independent School District 270, Hopkins.
148
Schedule 16
City of Hopkins
Full-Time Equivalent City Employees by Type
Last Ten Fiscal Years
Full-time-Equivalent Employees as of December 31,
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
General Government
Administrative Services 5.55 5.15 5.05 4.95 4.80 4.80 4.95 5.00 5.00 5.00
Finance 4.60 4.60 4.60 4.60 4.60 4.60 4.60 4.60 4.60 4.60
Municipal Building 1.45 1.45 1.45 1.45 1.45 1.45 1.45 1.45 1.45 1.45
Community Services 8.90 9.48 9.85 9.95 9.95 9.95 9.80 9.80 9.70 9.70
Public Safety
Police 38.50 39.40 39.45 40.00 39.00 40.00 39.50 36.45 34.50 36.50
Fire 1.20 1.20 1.20 1.20 1.20 1.20 1.20 1.25 1.25 1.25
Public Works 18.60 18.59 18.60 18.70 17.77 17.25 17.69 17.69 17.09 18.09
Recreation
Activity Center 4.10 4.00 3.30 3.30 3.30 3.30 3.20 3.20 3.20 3.20
Skate Park 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05
Planning & Zoning 1.20 1.20 1.15 1.15 1.35 1.35 1.35 1.35 1.35 1.35
Community Development - - - - - - 0.85 0.85 0.85 0.85
Total General Government 84.15 85.12 84.70 85.35 83.47 83.95 84.64 81.69 79.04 82.04
Special Revenue Funds
Economic Development 1.60 1.60 1.78 1.75 1.75 1.60 1.60 1.15 1.60 1.60
Paratransit 0.20 0.20 0.20 0.20 - - - - - -
Housing Rehabilitation 0.70 0.70 0.85 0.85 0.85 0.85 - - - -
Parking 2.00 1.00 1.00 1.00 1.00 1.00 0.72 0.72 0.72 1.00
Section 8 1.40 1.35 - - - - - - - -
Communication 0.05 0.10 0.10 0.10 0.40 0.25 0.25 0.25 0.25 0.25
Depot Coffee House - 0.05 1.00 1.00 1.00 1.50 1.50 2.50 2.50 2.50
Art Center 4.05 4.05 4.05 4.05 4.05 4.55 4.30 3.80 3.80 4.30
Total Special Revenue Funds 10.00 9.05 8.98 8.95 9.05 9.75 8.37 8.42 8.87 9.65
Enterprise Funds
Water 3.25 3.25 3.76 3.67 3.11 3.11 3.13 3.13 3.13 3.43
Sanitary Sewer 3.56 3.56 4.07 4.08 3.44 3.44 3.46 3.46 3.46 3.76
Refuse 4.08 4.08 4.09 4.12 3.40 3.58 3.89 3.89 3.89 3.89
Storm Sewer 0.46 0.46 0.46 0.46 0.42 0.42 0.63 0.63 0.63 0.63
Pavilion/Ice Arena 2.90 2.72 3.80 3.80 3.05 2.45 2.40 2.40 2.40 2.90
Housing and Redevelopment 2.40 2.45 2.05 2.05 2.05 2.20 2.20 2.20 2.20 2.20
Total General Government 16.65 16.52 18.23 18.18 15.47 15.20 15.71 15.71 15.71 16.81
Total 110.80 110.69 111.91 112.48 107.99 108.90 108.72 105.82 103.62 108.50
Source: City Finance Office
149
City of Hopkins
Operating Indicators by Function/Program
Last Ten Years
Fiscal Year
Function/Program 2006 2007 2008 2009 2010
General Government
Elections 2 1 2 1 2
Registered voters 10,621 8,330 11,233 9,548 9,393
Number of votes cast 6,279 1,146 8,835 861 5,761
Voter participation (registered)59.10%3.80%78.70%9%61.30%
Public Safety
Police
Total Calls for Service 18,567 19,137 19,440 19,238 19,141
Sworn Officers 26 26 26 26 26
Traffic Stops 3,321 4,287 3,042 2,698 2,597
Parking Citations 841 747 647 925 914
Fire
Fires 59 70 45 38 58
False Alarm 101 70 101 107 98
Fire Runs 297 350 291 220 370
Medical Runs 68 59 67 56 66
Average Response Time (minutes) 5.3 4.3 4.0 4.2 4.0
Inspections
Building Permits 494 377 897 381 4
Value of Building Permits $ 14,272,117 $ 50,544,210 $ 45,074,024 $ 54,688,290 $ 10,968,955
Public Works
Miles of seal coating 4 3.2 2.60 0.55 0.95
Miles of crack sealing 3.25 2.88 4.97 3.71 1.99
Sidewalk repairs in square feet 2,875 4,279 4,930 6,228 5,252
Alley repairs in square yards 130 253 238 142 170
Culture and Recreation
Art Center
Bookings 5,570 6,054 5,593 5,392 4,913
Reserved Hours 35,710 39,060 34,760 33,780 30,414
Customer Visits for Events/Activities 202,000 203,000 212,000 203,100 205,319
Water
Gallons of water pumped (in millions) 786.0 794.7 774 813 794
Number of well house inspections 2,488 2,488 2,488 2,484 2,501
Number of hydrants flushed 100+100+100+ 130 144
Water Rate $ 1.40 $ 1.40 $ 1.65 $ 1.86 $ 1.90
Sanitary Sewer
Sanitary sewage flow (in millions of gallons) 638.0 641.3 626.2 580.2 567.8
Miles of sewer lines jetted 14.6 17.3 14.6 14.2 15.4
Number of manholes checked/cleaned 262 441 344 1,290 1,301
Lift Station Maintenance checks 4,374 4,374 3,855 4,312 4,310
Sewer Rate $ 2.50 $ 2.50 $ 2.70 $ 3.10 $ 3.40
Refuse
Number of refuse accounts 2,766 2,670 2,678 2,689 2,695
Tons of refuse collected 2,549 2,448 2,393 2,335 2,298
Tons of recycled material (residential) 1,118 1,138 1,080 1,194 1,148
Refuse rate $ 12.50-15.90 $ 12.50-15.90 $ 13.20 - 17.25 $ $15.85-21.85 $ 15.85-21.85
Recycling rate $ 2.75 $ 2.75 $ 3.25 $ 3.50 $ 3.75
Pavilion/Ice Arena
Ice time rental hours 1,443 1,458 1,469 1,456 1,455
Turf use hours 407 442 479 624 624
Mezzanine rental use 339 345 400 495 776
Source: Various City Departments
Notes:
(1) Information not available is labeled N/A..
(2) In 2009 the Sewer Department began checking manholes on a monthly basis.
150
Schedule 17
Fiscal Year
2011 2012 2013 2014 2015
1 2 1 2 1
9,691 10,912 9,917 109,123 9,647
961 9,130 1,674 9,130 1,058
9.90%83.70%16.90%83.70%11.0%
21,257 25,379 25,286 26,140 23,535
26 26 26 26 28
5,231 7,602 6,333 5,741 6,055
865 958 979 820 725
40 36 38 51 18
95 91 101 100 103
331 382 382 428 467
77 141 178 195 177
4.0 4.0 4.2 4.2 4.4
631 501 509 455 501
$ 19,211,258 $ 9,804,196 $ 44,183,445 $ 16,453,935 $ 12,631,596
0.85 5.36 5.49 5.26 1.81
7.26 4.13 3.75 5.85 5.26
5,831 5,770 5,172 4,482 6,800
200 201 190 41 182
4,307 4,307 4,440 4,747 5,013
26,406 26,406 27,442 29,440 31,759
219,975 219,975 213,487 215,371 216,450
744 781 817 812 751
2,446 2,480 2,465 2,510 2,190
151 142 138 150 120
$ 1.90 $ 1.96 $ 2.02 $ 2.10 $ 2.18
606.5 601.9 579.0 628.6 615
14.6 14.7 16.2 14.6 12
1,421 1,337 1,413 1,400 274
4,321 4,314 4,307 4,401 4,350
$ 3.60 $ 3.75 $ 3.90 $ 4.10 $ 4.30
2,687 2,681 2,706 2,709 2,735
2,265 2,470 2,136 2,393 2,368
1,222 1,182 757 1,114 1,106
$ 16.85 - 23.15 $ 16.85 - 24.30 $ 16.85 - 24.30 $ 16.85 - 24.30 $ 16.85 - 24.30
$ 3.75 $ 4.00 $ 4.25 $ 4.25 $ 4.50
1,407 1,429 1,401 1,370 1,365
758 869 865 810 818
1,150 1,260 1,386 2,147 2,822
151
Schedule 18
City of Hopkins
Capital Asset Statistics by Function/Program
Last Ten Years
Fiscal Year
Function/Program 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Public Safety
Police
Stations 1 1 1 1 1 1 1 1 1 1
Patrol Units 10 10 10 10 11 11 11 11 11 11
Fire
Stations 1 1 1 1 1 1 1 1 1 1
Public Works
Highways (miles) 3.57 3.57 3.57 3.57 3.57 3.57 3.57 3.57 3.57 3.57
County Highways 5.69 5.32 5.32 5.32 5.32 5.32 5.32 5.32 5.32 5.32
City Streets (miles) 47.13 47.50 47.50 47.50 47.50 47.50 47.50 47.50 47.50 47.50
Alleys (miles) 9.52 9.52 9.52 9.52 9.52 9.52 9.52 9.52 9.52 9.52
Streetlights 350 360 360 398 398 398 398 398 398 398
Traffic Signals 44 44 44 44 44 44 44 44 44 44
Refuse collection trucks 3 3 3 3 3 3 3 3 3 3
Culture & Recreation
Parks
Parks 16 16 16 16 16 16 16 16 16 16
Park Trails 3 3 4 4 4 4 4 4 4 4
Park Acres 102 102 104 104 104 104 104 104 104 104
Park Shelters 10 10 10 10 10 11 11 11 11 11
Playgrounds 11 11 11 11 11 11 11 11 11 11
Skateboard Park/Inline Skating 1 1 1 1 1 1 1 1 1 1
Skating Rinks 7 7 7 7 7 7 7 7 7 7
Hockey Rinks 6 6 6 6 5 5 5 5 5 5
Basketball Courts 6 6 6 6 6 6 6 6 6 6
Softball Fields 4 4 4 4 4 4 4 4 4 4
Swimming Beach 1 1 1 1 1 1 1 1 1 1
Tennis Courts 12 12 8 8 8 8 8 8 8 8
Volleyball Courts 2 2 2 2 2 2 2 2 2 2
Watermains
Distribution System (miles) 52.60 52.60 52.60 52.60 52.60 52.60 52.60 52.60 52.60 52.60
Fire Hydrants 560 560 560 560 560 560 560 560 560 560
Storage Capacity (gallons in thous) 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200
Water Connections 3,144 3,157 3,163 3,163 3,168 3,168 3,168 3,168 3,168 3,168
Sanitary Sewer
Collection System (miles) 45.46 45.46 45.46 45.46 45.46 45.46 45.46 45.46 45.46 45.46
Sewer Connections 3,064 3,077 3,081 3,081 3,086 3,086 3,086 3,086 3,086 3,086
Storm Sewer
Pipe (miles) 21.40 21.40 21.40 21.40 21.40 21.40 21.40 21.40 21.40 21.40
Parking
Parking Lots 7 7 7 7 7 7 7 7 7 7
Parking Ramp 1 1 1 1 1 1 1 1 1 1
Source: Various City Departments
152