VII.5. Fourth Quarter Financial Update; Bishop
CITY OF HOPKINS
Memorandum
To: Honorable Mayor and Council Members
Mike Mornson, City Manager
From: Nick Bishop, Finance Director
Date: May 6, 2025
Subject: Fourth Quarter Financial Update
_____________________________________________________________________
The fourth quarter financial report has been prepared based on preliminary and unaudited
results. Audit field work was completed the second week of April. Financial Statements
are required to be issued by June 30.
General Fund
The City’s General Fund revenue exceeded budget by $436,163 or 2.42%. General Fund
expenditures and transfers out exceeded budget by $1,163,071 or 6.31%. The fund
balance decreased by $1,126,908, which is $299,258 more than projected. Ending fund
balance is 43.45% of budgeted expenditures.
The main factors for the decrease in fund balance are:
• Planned Transfer to the Capital Improvement Fund ($427,650) – The transfer is
based on a surplus fund balance in 2021 and supports projects at the Activity
Center and City-Wide door access controls.
• Planned Decrease in Fund Balance based on Budget of ($400,000) – The
decrease is based on a surplus fund balance in 2022 and supports all general fund
operations.
• Implementation of GASB Statement 101 ($231,000) – The statement required the
City to recognize a liability related to the employer portion of FICA and PERA costs
for unused flex, vacation and sick time.
Projected Actual
Fund Balance on 1/1/2024 9,131,047 9,131,047
2024 Revenues 18,021,803 18,457,966
2024 Expenditures (18,421,803) (19,157,224)
Transfer to Capital Improvement Fund (427,650) (427,650)
Fund Balance on 12/31/2024 8,303,397 8,004,139
Fund Balance as Percent of Budgeted Expenditure 45.07%43.45%
Finance
Department
• Police retro pay related to 2023 ($144,000) – An amendment to Hopkins Police
Officers Association agreement for 2021-2023 was signed to recognize the change
in market conditions since it’s adoption.
• Expenditure increases are also offset by higher than anticipated revenue related
to the Inspections Department, ICPOET Grant and interest revenue.
Special Revenue Funds
The Chemical Assessment, Economic Development, Parking, Communications, Depot
Coffee House and Arts Center Funds collectively decreased their fund balances by
$491,983.
• Chemical Assessment – increased fund balance by $57,148, due to
reimbursements related to expenditures in prior periods.
• Economic Development – decreased fund balance by $464,054 primarily due to
the timing of pass-through grant revenue and payments.
• Parking Fund – decreased fund balance by $131,758, due to decreased parking
demand at muncipal lots and the parking ramp.
• Communication Fund – decreased fund balance by $44,369, due to a planned
reduction in fund balance and decreased franchise fees collected.
• Depot Coffee House – increased fund balance by $47,642, partially due to closing
coffee operations for the majority of 2024 and partially due to increased revenue
from a successful reopening in the fall.
• Arts Center - increased fund balance by $43,408. The increase can be attributed
to cost-effective operations and eliminates the fund balance deficit.
Enterprise Funds
The Water, Sewer, Refuse, Storm Sewer and Pavilion Funds collectively decreased their
working capital by $60,651. Working capital is the difference between current assets and
current liabilities. It represents the amount available to meet current financial needs. It
does not include capital assets and is not affected by depreciation expense. The chart
below shows changes to working capital for enterprise funds.
Chemical
Assessment
Economic
Development
Parking
Fund
Communications
Fund Depot Fund Arts Center
Fund Balance on 1/1/2024 (100,258) 5,205,990 (93,542) 86,022 (190,713) (31,344)
2024 Revenues 133,153 1,104,198 47,722 201,142 194,254 1,201,710
2024 Expenditures (76,005) (1,568,252) (179,480) (245,511) (146,612) (1,158,302)
Increase (decrease) in Fund Balance 57,148 (464,054) (131,758) (44,369) 47,642 43,408
Fund Balance on 12/31/2024 (43,110) 4,741,936 (225,300) 41,653 (143,071) 12,064
Water Sewer Refuse Storm Sewer Pavilion
Working Capital on 1/1/2024 1,624,593.00 1,907,811.00 1,123,475.00 3,020,528.00 -
Increase (Decrease) to Working Capital
Operating Activities 358,784.00 443,587.00 34,120.00 463,944.00 183,164.00
Capital & Financing Activities (703,100.00) (398,170.00) - (242,980.00) (200,000.00)
Total Increase (Decrease) to Working Capital (344,316.00) 45,417.00 34,120.00 220,964.00 (16,836.00)
Working Capital on 12/31/2024 1,280,277.00 1,953,228.00 1,157,595.00 3,241,492.00 (16,836.00)