Memo-December 2003 Financial Report•
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Memorandum
Date: 1/15/04
To: Steve Mielke
Cc: Mayor and Councilmembers
From: Lori K Yager
RE: Preliminary December 2003 Financial Report
The City Council and city staff did an excellent job keeping costs down in 2003!
Salaries and benefits were cut by 2% of the 2003 budget. In addition to the cuts,
salaries and benefits are under 2003 adjusted budget by 2.6 %. This amounts to a
total savings from the original budget of $380,000.
i Materials, supplies and services were cut by 2% of the 2003 budget. In addition to
the cuts; materials, supplies and services are under 2003 adjusted budget by 13 %.
This amounts to a total savings from the original budget of $700,000.
Capital was cut by 11% of the 2003 budget. In addition to the cuts, capital
expenditures are under 2003 adjusted budget by 59 %. This amounts to a total of
$2.400,000. However, $2,000,000 will be reserved for the county road three
redevelopment project.
Excluding the reserves for projects, a total budget savings of 9% occurred in 2003. A
total of approximately $1,480,000 below the original 2003 budget.
In the general fund, expenditures are under the adjusted budget by 8%
Total revenues were cut 4% in 2003. This was the loss of state aids from the State of
Minnesota, which amounted to $731,000. Although the city lost aid it was replaced with
additional revenue sources such as charges for services, additional grants, increased
redevelopment creating more permit revenues, etc... Ultimately the city fell short of its'
original revenue budget by only $60,000.
Effective planning, careful decision making processes, along with support from employees
and citizens helped the city in achieving the successes in 2003.
Attached are financial reports for the period ending December 31, 2003 along with some
comparative information. After brief analysis, some general comments can be made in
regards to the quarterly reports for the City.
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12110/97
GENERAL FUND REVENUES
• Property taxes now support 72% of the general fund programs. Intergovernmental
revenues, including the market value credit, support 14% of the general fund
programs. These two revenue sources make up 86% of the general fund sources.
Property tax revenues in the general fund increased less than 2% over 2002. At the
same time intergovermnental revenues decreased another 27% over last year. This is
illustrated in the attached graph of' revenues.
• Where the city did experience large increases was in permit revenues. Permit
revenues increased 50% over last year. The primary increase resulted from the
Regency and Market Place Lofts developments. The city also experienced increases
in plan check fees, which coincides with the new developments.
• General fund revenues are up only 1% over last year at this time.
GENERAL FUND EXPENDITURES
• The general fund is under the adjusted budget by $600,000. The savings are as
follows:
r Salaries $180,000
Supplies $ 50,000
Training /Travel $ 35,000
Contingency $150,000
Capital $1 00,000
Other $ 85,000
• All departments are under budget except for fire. The fire department exceeded the
amount budgeted for maintenance and repair of vehicles. One of the fire trucks was
damaged during a fire response in 2003. The repairs exceeded normal maintenance
costs by $30,000. Finance will be requesting a budget transfer from contingency to
cover the 2003 expenditures in the fire department.
o City Council expenditures continue to reflect a pattern of decreasing costs
over four years.
o Administrative Services reduced expenditures by transferring 50% of the
communication position and 50% of the Assistant to the City Manager
position to other funds.
o Finance is basically the same.
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12/10/97
o Legal costs are up about 7% over last year.
o Municipal Building expenditures fluctuate every year based on equipment
breakdowns, remodeling, heating and maintenance fluctuations.
o Activity Center costs are up $10,000 do to the new responsibility of
publishing its' own newsletter.
o Community Services is basically the same.
o Police expenditures decreased $170,000 over last year. This is attributed to
having less capital costs in 2003 then 2002, ( and an unfilled police
position.
o Public Works expenditures decreased 10% over last year primarily due to
early retirements and unfilled positions.
o Recreation expenditures are lower because we have paid off the Shady Oak
Beach redevelopment costs.
o Community Planning is basically unchanged. General fund expenditures are
below target by 7 %.
o Overall there is an 8% decrease in spending in 2003.
• The general fund reserves are currently projected to increase by S600,000. This
amount is projected to decrease by up to $150,000 during the final year -end
adjustment period. This will still leave a $450,000 increase in the general fund
reserves. The Office of the State Auditor recommends that cities keep their fund
balance for general and special revenue funds between 30 and 50 percent of current
expenditures. The cities projected general fund balance will be at 53% of
expenditures, slightly higher then recommended levels. Following previous
directions from the council, finance is recommending transferring $100,000 unspent
contingency budget to the cities capital improvement fund for current or future capital
improvement projects.
SPECIAL REVENUE FUNDS
• Fund balance totals in the special revenue funds are projected to decrease $200.000.
The city will continue to exceed the recommended fund balances in these funds
primarily because of the unreserved funds in the Economic Development fund. Staff
believes that availability of funding sources for redevelopment activity will be very
limited and therefore it suggests keeping a higher then recommended fund balance.
• Revenues in the special revenue funds have stayed about the same as last year.
Expenditures are also projected to be about the same as last year.
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1 2/1 0/97
DEBT SERVICE FUNDS
• Revenues in the debt service funds increased approximately $300,000. This is for the
first interest payment on the facility project debt. Expenditures decreased by
$2.00,000, because of the refunding in 2002.
• The debt service fund balance is projected to be $3,000,000, which is approximately
one years' worth of principal and interest payments.
CAPITAL PROJECT FUNDS
• Revenues in the capital project funds decreased approximately $250,000. This is
because the city sold bonds for a premium of $150,000 last year and in 2003 we
transferred $100,000 in state aid for street maintenance from the capital funds to the
general fund to help offset local government aid losses.
• The capital projects fund balance will decrease approximately $3,500,000 this year do
to construction costs. The balance of $10.000,000 will be used to pay for finishing
the facility projects and future road, park and infrastructure improvements.
ENTERPRISE FUNDS
• Water, Sewer, Storm Sewer and Refuse fund revenues increased approximately
$77,000 or 2 %. This could be attributed to slightly higher water usage in 2003.
• Salaries and benefits in the utility funds are under budget by 9 %. Total savings in the
utility funds for all expenditures amounts to $280,000 under budget.
A presentation regarding the information above will be distributed the night of the January
20, 2004 council meeting.
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Revenues
Expenditures
CITY OF HOPKINS
2003 FINANCIAL REPORT - DECEMBER
GENERAL FUND
Year To Date 12 Months 100% of Year
Amended
2003 Budget
Year to Date
Percentage Percentage
Received/ Received/
Expended Expended
2003 2002
Property Taxes $ 5,905,252 $ 5,893,516 99.80% 93.66%
Intergovernmental Revenue 1,082,383 1,117,821 103.27% 128.27%
Licenses and Permits 495,530 638,165 128.78% 108.75%
Fines and Forfeitures 130,000 113,592 87.38% 75.23%
Interest Earnings 160,615 99,303 61.83% 66.27%
Charges for Services 196,340 294,516 150.00% 136.04%
Other Miscellaneous 12,664 9,728 76.82% 81.48%
Total $ 7,982,784 $ 8,166,641 102.30% 100.07%
Mayor /Council $ 104,029 $ 72,584 69.77%
Administrative Services 310,049 288,423 93.02%
Finance 149,599 146,451 97.90%
Legal 123,980 118,142 95.29%
Municipal Building 111,772 69,348 62.04%
Activity Center 309,305 290,208 93.83%
Community Services 761,487 759,204 99.70%
Police 3,396,387 3,317,623 97.68%
Fire 569,439 597,159 104.87%
Emergency Preparedness 24,690 7,189 29.12%
Public Works 1,790,540 1,558,144 87.02%
Recreation 226,405 198,993 87
Planning & Economic Dev. 101,790 98,945 97.21%
Unallocated 165,150 0 0.00%
Transfers 15,953 15,953 100.00%
Total $ 8,160,575 $ 7,538,366 92.38%
Sources (Uses) of Fund
Balance ($177,791) $628,275
72.51%
93.01%
101.04%
90.22%
69,35%
92,54%
98.79%
99.24%
100.23%
10.24%
93.20%
95.25%
94.79%
91.20%
100.00%
98.77%
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Revenues
Total
Expenditures
Total
Sources (Uses) of Fund Balance
CITY OF HOPKINS
FOUR YEAR COMPARATIVE FINANCIAL REPORT
FOR THE PERIOD ENDING DECEMBER 31, XXXX
GENERAL FUND
2003 2002 2001 2000
Property Taxes $5,893,516 $5,779,963 $4,740,933 $4,327,792
Intergovernmental Revenue 1,117,821 1,527,016 2,179,180 2,134,678
Licenses and Permits 638,165 463,373 377,045 428,435
Fines and Forfeitures 113,592 105,328 108,141 111,221
Interest 99,303 108,020 161,728 165,005
Charges for Services 294,516 248,607 175,202 218,832
Other Miscellaneous 9,728 49,032 54,157 49,981
$8,166,641 $8,281,339
$7,796,386 $7,435,944
MayorlCoucnil 72,584 82,313 100,935 $117,995
Administrative Services 288,423 361,549 302,895 314,025
Finance 146,451 150,446 134,251 128,093
Legal 118,142 110,925 96,776 97,389
Municipal Building 69,348 78,099 114,034 76,790
0 Activity Center 290,208 280,906 277,051 261,087
Community Service 759 762,125 724,678 682,955
Police 3,317 3,487,910 3,085,939 2,916,457
Fire 597,159 579,237 597,472 557,998
Emergency Preparedness 7,189 2,572 13,657 1,192
Public Works 1,558,144 1,734,925 1,788,624 1,659,285
Recreation 198,993 327,302 233,804 225,937
Planning & Economic Dev. 98,945 100,309 171,170 129,365
Unallocated 0 93,508 33,934 1,318
Transfers 15,953 24,500 36,081 16,943
$7,538,366 $8,176,626
$628,275 $104,713
$7,711,301 $7
$85 $249,115
$3,500,000 -
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$0
General Fund Expenditure Comparison for Period Ending December 31, 200X
111
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-4%
Cr
+�G to, d • e
,``J edQs
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0 2003
0 2002
02001
0 2000
$6,000,000
$5,500,000
$5,000,000
$4,500,000
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$0
General Fund Revenue Comparison for Period Ending December 31, 2003 and 2002
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0 2002
2001
. CURRENT AND HISTORIC QUARTERLY REPORT FOR ENTERPRISE FUND OPERATIONS
(no capital, construction or depreciation)
For the Quarter Ending December 31
2003 2002 2001 2000 1999
WATER
OPERATING REVENUE 908,819 888,359 988,725 1,065,766 854,016
OPERATING EXPENSE 735,767 697,981 695,921 679,075 670,177
OPERATING INCOME 173,052 190,378 292,804 386,691 183,839
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SEWER
REVENUE
OPERATING EXPENSE 1,362,420 1,268,065 1,225,777 1,138,321 1,206,811
OPERATING INCOME (45,490) 108,433 183,022 292,618 213,142
REFUSE
REVENUE 562,739 623,332 570,272 564,190 568,078
OPERATING EXPENSE 596,623 633,487 642,534 593,444 571,782
OPERATING (LOSS) (33,884) (10,155) (72,262) (29,254) (3,704)
STORM SEWER
REVENUE 686,149 692,697 676,492 661,776 643,303
OPERATING EXPENSE 95,879 100,556 118,498 123,082 84,281
OPERATING INCOME 590,270 592,141 557,994 538,694 559,022
PAVILLION /ICE ARENA
REVENUE
OPERATING EXPENSE
OPERATING INCOME
1,316,930 1,376,498 1,408,799 1,430,939 1,419,953
259,337 260,674 266,753 247,326 251,114
269,313 254,203 261,512 224,013 247,861
(9,976) 6,471 5,241 23,313 3,253
Page 1
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Revenue
Expense
Equip.
Replc.
17,792
Operating Income(Loss) 241,344
Non - Operating
Revenue (Expense)
Net Income (Loss)
Capital Outlay
Bond payment
Cash Balance 12/31/03
Cash Balance 12/31/02
Cash Variance
Explanation of Cash
Variances
$ (102,130) $ (131,453)
(77,475) (82,862)
(105,000)
$ 2,065,014 $ 1,046,778
$ 1,973,112 $ 855,348
91,902 191,430
Operating
income
CITY OF HOPKINS
2003 FINANCIAL REPORT - DECEMBER
PROPRIETARY FUNDS
Year to Date
Water
Sewer
$ 259,136 $ 908,819 $ 1,316,930 $ 562,739 $
735,767 1,362,420
173,052
(343,474) (304,505) (95,418)
Receivable Receivable
from from
Storm Sewer Storm Sewer
Refuse/
Bulk
596,623
(45,490) (33,884)
7,338
$ (140,908) $ (26,546) $ 310,505
(29,691) (7,286) (21,514)
(250, 000)
$ 1,245,472 $ 584,555 $ 1,368,967
$ 982,562 $ 629,077 $ 165,571
262,910 (44,522) 1,203,396
Operating
Toss
Storm
Sewer
95,879
590,270
(279,765)
Bond
issuance
Pavilion/
Ice Arena
686,149 $ 259,337 $ 5,655
269,313
(9,976)
(58,430)
Skate
Park
15,504
(9,849)
(3,038)
$ (68,406) $ (12,887)
(643,214)
0
$ 47,518 $ (20,816)
$ 68,260 $ (10,472)
(20,742) (10,344)
Loan from Operating
Equip losses
Rpcl plan
General Fund $ 3,409,647 $ 4,012,788 $ 603,141 $ 3,345,308
Economic Development Fund 3,114,834 2,971,881 (142,953) 3,186,221
Housing Rehab Fund 1,109,456 1,023,669 (85,787) 1,064,111
Parking Fund 295,130 288,433 (6,697) 275,668
Cable TV Fund 291,503 304,754 13,251 378,275
Tax Increment 1.1 Fund 945,477 1,035,556 90,079 948,479
Tax Increment 1.2 Fund 187,871 233,643 45,772 187,896
Tax Increment 2.1 Fund 224,692 364,658 139,966 390,873
411 Tax Increment 2.7 Fund 64,628 88,844 24,216 162,106
Tax Increment 2.8 Fund 14,158 52,242 38,084 42,523
Tax Increment 2.9 Fund 167,288 185,571 18,283 165,917
Tax Increment 2.10 Fund 15,169 101,045 85,876 36,507
Tax increment 2.11 Fund 2,877,811 2,430,367 (447,444) 2,676,959
Park Improvement Fund 198,929 114,744 (84,185) 164,002
Municipal State Aid Construction Fund 2,231,496 3,030,808 799,312 2,254,911
Capital Improvement Fund 10,304,807 7,202,885 (3,101,922) 10,401,559
P.I.R. Construction Fund 1,536,142 422,041 (1,114,101) 1,169,914
Debt Service 4,727,313 3,026,483 (1,700,830) 2,719,081
12/31/2003 12/31/2002
Total City Funds $ 30,191,172 $ 32,921,449
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Fund
CITY OF HOPKINS
2003 FINANCIAL REPORT - DECEMBER
STATUS OF RESERVES
Beginning
Balance Balance Balance
(Deficit) (Deficit) Dollar (Deficit)
1/1/2003 12/31/2003 Difference 12/31/2002