HomeMy WebLinkAbout1998 Audit Report
CITY OF ST. JOSEPH, MINNESOTA
Stearns County
AUDITED FINANCIAL STATEMENTS
As of
December 31, 1998
CITY OF ST. JOSEPH, MINNESOTA
TABLE OF CONTENTS
ELECTED OFFICIALS AND ADMINISTRATION ..................................................... 1
IND EPEND ENT AUDITORS' REPORT.............. ......................................................... 2
GENERAL PURPOSE FINANCIAL STATEMENTS -
Combined Balance Sheet - All Fund Types and Account Groups............................. 4
Combined Statement of Revenues, Expenditures and Changes in Fund Balance -
All Governmental Fund Types... ............ ................. .................... ....... ...................... 5
Combined Statement of Revenues, Expenditures and Changes in Fund Balance -
Budget and Actual - General and Special Revenue Fund Types ............................. 6
Combined Statement of Revenues, Expenses and Changes in Retained
Earnings - All Proprietary Fund Types.................................................................... 7
Combined Statement of Cash Flows - All Proprietary Fund Types .......................... 8
Notes to the Financial Statements... ............ .......... .............................. ....................... 9
COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS -
General Fund -
Comparative Balance Sheets................................................................................ 32
Statement of Revenues, Expenditures and Changes in Fund Balance-
Budget and ActuaL................ ................................................ ............................. 33
Special Revenue Fund -
Combining Balance Sheet.................. ........................................ .......................... 39
Combining Statement of Revenues, Expenditures and Changes in
Fund Balance......................................................................... ...... ...................... 40
Debt Service Funds -
Combining Balance Sheet.......................................................... .......................... 41
Combining Statement of Revenues, Expenditures and Changes in Fund
Balance............................................................ ....................... ............................ 42
Capital Project Funds-
Combining Balance Sheet.................................................................................... 43
Combining Statement of Revenues, Expenditures and Changes in Fund
Balance................................................................................... ............................ 44
Enterprise Funds -
Combining Balance Sheet.................................... .................... ............................ 45
Combining Statement of Revenues, Expenses and Changes in Retained
Earnings..........................................:............................................ ...................... 46
Combining Statement of Cash Flows .................................................................. 47
Statement of General Long- Tenn Debt ..................................................................... 48
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER
FINANCIAL REPORTING BASED ON AN AUDIT OF THE GENERAL
PURPOSE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE
WITH GOVERNMENT AUDITING STANDARDS ....................................................... 49
INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH MINNESOTA
STATUTES .................................................................................................................. 51
FINDINGS AND CORRECTIVE ACTION PLANS ON COMPLIANCE WITH
MINNESOTA STATUTES AND INTERNAL CONTROLS ......................................... 53
CITY OF ST. JOSEPH, MINNESOTA
ELECTED OFFICIALS AND ADMINISTRATION
December 31, 1998
Term
City Council Position Expires
Ken Hiemenz Mayor January 7, 1999
Cory Ehlert Councilmember January 7, 1999
Bob Loso Councilmember January 7, 1999
Mary Niedenfuer Councilmember January 9, 2001
Ken Twit Councilmember January 9, 2001
Administration
Rachel Stapleton City Clerk!
Treasurer/
Administrator Appointed
Judy Weyrens Deputy Clerk Appointed
1
~~ Kern, DeWenter, Viere, Ltd.
Certified Public Accountants
INDEPENDENT AUDITORS' REPORT
March 10, 1999
Honorable Mayor and City Council
City ofSt. Joseph
St. Joseph, Minnesota
We have audited the general purpose financial statements of the City ofSt. Joseph, Minnesota, as
of and for the year ended December 31, 1998, as listed in the table of contents. These general
purpose financial statements are the responsibility of the City's management. Our responsibility
is to express an opinion on these general purpose [mancial statements based on our audit.
Except as discussed in the following paragraphs, we conducted our audit in accordance with
generally accepted auditing standards 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 general purpose financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and disclosures in the
general purpose financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the overall general
purpose financial statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
Governmental Accounting Standards Board Technical Bulletins 98-1 and 99-1, Disclosures
about Year 2000 Issues, requires disclosure of certain matters regarding the year 2000 issue in
order for financial statements to be prepared in conformity with generally accepted accounting
principles. Such required disclosures include:
· Any significant amount of resources committed to make computer systems and other
electronic equipment year 2000-compliant;
· A general description ofthe year 2000 issue, including a description of the stages of work in
process or completed as of the end of the reporting period to make computer systems and
other electronic equipment critical to conducting operations year 2000-compliant; and
· The additional stages of work necessary for making the computer systems and other
electronic equipment year 2000-compliant.
220 Park Avenue South, P.O. Box 1304 7600 Bass Lake Road, Suite 104
St. Cloud, MN 56302 Minneapolis, MN 55428
320-251-7010 · Fax: 320-251-1784 612-537-3011. Fax: 612-537-9682 2
Twin Cities Metro: 612-338-6202 www.kdv.com
www.kdv.com
City of St. Joseph
March 10, 1999
Page 2
The City of St. Joseph has omitted such disclosures. We do not provide assurance that the City
of St. Joseph is or will be year 2000 ready, that the City of St. Josephs' year 2000 remediation
efforts will be successful in whole or in part, or that parties with which the City of St. Joseph
does business will be year 2000 ready.
In our opinion, except for the omission of the disclosures about Year 2000 issues, the general
purpose fInancial statements referred to above present fairly, in all material respects, the
fInancial position ofthe City ofSt. Joseph, Minnesota, as of December 31, 1998, and the results
of its operations and cash flows of its proprietary fund types, for the year then ended in
confonnity with generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued our report dated
March 10, 1999 on our consideration ofthe City ofSt. Josephs' internal control over financial
reporting and our tests of its compliance with certain provisions of laws, regulations, contracts
and grants.
Our audit was perfonned for the purpose of fonning an opinion on the general purpose fInancial
statements of the City taken as a whole. The combining and individual fund financial statements
listed in the table of contents are presented for purposes of additional analysis and are not a
required part of the general purpose financial statements of City ofSt. Joseph, Minnesota. Such
infonnation has been subjected to the auditing procedures applied in the audit ofthe general
purpose fInancial statements taken as a whole.
f{.{/VÍL I & W.t-It- t¿ù) 1I~" L,TÜ.
KERN, DEWENTER, VlERE, LTD.
3
CITY OF ST. JOSEPH, MINNESOTA
COMBINED BALANCE SHEET -
ALL FUND TYPES AND ACCOUNT GROUPS
December 31,1998
Governmental Fund Types
Special Debt Capital
ASSETS AND OTHER DEBITS General Revenue Service Projects
ASSETS:
Cash and Investments (Including Cash
Equivalents) $ 1,423,916 $ 98,117 $ 1,533,143 $ 336,559
Taxes Receivable -
Delinquent 2,966 0 1,179 0
Special Assessments Receivable -
Deferred 60,078 0 648,933 0
Delinquent 29 0 0 0
Accounts Receivable 49,295 0 5,800 0
Interest Receivable 24,169 632 24,568 0
Due from Other Governmental Units 144,798 0 21,188 0
Fixed Assets - Net 0 0 0 0
OTHER DEBITS:
Amount Available in Debt Service Funds 0 0 0 0
Amount to be Provided from Special
Assessments 0 0 0 0
Amount to be Provided for Compensated
Absences Payable 0 0 0 0
Amount to be Provided for Retirement of
General Long-Term Debt 0 0 0 0
TOTAL ASSETS AND OTHER DEBITS $ 1,705,251 $ 98,749 $ 2,234,811 $ 336,559
LIABILITIES, EQUITY AND OTHER CREDITS
LIABILITIES:
Cash Overdraft $ 0 $ 0 $ 0 $ 0
Accrued Liabilities 70,459 6,149 0 7,837
Due to Other Governmental Units 0 0 0 0
Contracts Payable 0 0 0 77,201
Deferred Revenue 63,073 0 650,112 0
Compensated Absences Payable 47,577 0 0 0
Bonds Payable 0 0 0 0
Total Liabilities 181,109 6,149 650,112 85,038
EQUITY AND OTHER CREDITS:
Investment in General Fixed Assets 0 0 0 0
Contributed Capital 0 0 0 0
Retained Earnings (Deficit) 0 0 0 0
Fund Balance -
Reserved 0 0 1,584,699 280,941
Unreserved -
Designated 1,019,532 0 0 0
Undesignated (Deficit) 504,610 92,600 0 (29,420)
Total Equity and Other Credits 1,524,142 92,600 1,584,699 251,521
TOTAL LIABILITIES, EQUITY
AND OTHER CREDITS $ 1,705,251 $ 98,749 $ 2,234,811 $ 336,559
The notes to the financial statements are an integral part of this statement.
-
Proprietary
Fund Types Account Groups
General General Totals
Fixed Long-Tenn (Memorandum Only)
Enterprise Assets Debt 1998 1997
$ 776,145 $ 0 $ 0 $ 4,167,880 $ 3,518,600
0 0 0 4,145 8,550
0 0 0 709,011 693,954
0 0 0 29 3,759
107,250 0 0 162,345 121,172
13,647 0 0 63,016 50,344
0 0 0 165,986 132,103
3,915,829 2,460,993 0 6,376,822 6,320,730
0 0 1,584,699 1,584,699 1,193,334
0 0 648,933 648,933 609,038
0 0 58,865 58,865 49,897
0 0 2,551,368 2,551,368 2,652,628
$ 4,812,871 $ 2,460,993 $ 4,843,865 $ 16,493,099 $ 15,354,109
$ 0 $ 0 $ 0 $ 0 $ 72,376
21,944 0 0 106,389 102,835
7,507 0 0 7,507 6,484
0 0 0 77,201 43,216
0 0 0 713,185 706,263
18,906 0 58,865 125,348 114,183
0 0 4,785,000 4,785,000 4,455,000
48,357 0 4,843,865 5,814,630 5,500,357
0 2,460,993 0 2,460,993 2,288,254
4,831,186 0 0 4,831,186 4,831,186
(66,672) 0 0 (66,672) (63,628)
0 0 0 1,865,640 1,343,073
0 0 0 1,019,532 963,006
0 0 0 567,790 491,861
4,764,514 2,460,993 0 10,678,469 9,853,752
$ 4,812,871 $ 2,460,993 $ 4,843,865 $ 16,493,099 $ 15,354,109
4
CITY OF ST. JOSEPH, MINNESOTA
COMBINED STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE - ALL GOVERNMENTAL FUND TYPES
Year Ended December 31, 1998
Governmental Fund Types
Special Debt
General Revenue Service
REVENUES:
General Property Taxes $ 318,663 $ 0 $ 137,925
Special Assessments 40,308 0 208,548
Licenses and Permits 62,111 0 0
Intergovernmental 611,454 10,000 75,738
Charges for Services 189,998 0 0
Fines 60,081 0 0
Miscellaneous 326,275 29,310 174,261
Total Revenues 1,608,890 39,310 596,472
EXPENDITURES:
Current -
General Government 311,329 0 0
Public Safety 672,956 11,461 0
Public Works 298,638 0 0
Culture and Recreation 137,333 0 0
Economic Development 60,445 0 0
Miscellaneous 300 0 3,225
Capital Outlay 0 0 0
Debt Service 0 0 457,743
Total Expenditures 1,481,001 11,461 460,968
EXCESS OF REVENUES OVER (UNDER)
EXPENDITURES 127,889 27,849 135,504
OTHER FINANCING SOURCES (USES):
Operating Transfers In 0 0 239,627
Operating Transfers Out (44,230) 0 0
Proceeds From the Sale of Bonds 0 0 16,234
Total Other Financing Sources (Uses) (44,230) 0 255,861
EXCESS OF REVENUES AND OTHER
FINANCING SOURCES OVER EXPENDITURES
AND OTHER FINANCING USES 83,659 27,849 391,365
FUND BALANCE - January 1 1,440,483 64,751 1,193,334
FUND BALANCE - December 31 $ 1,524,142 $ 92,600 $ 1,584,699
The notes to the financial statements are an integral part of this statement.
Totals
Capital (Memorandum Only)
Projects 1998 1997
$ 0 $ 456,588 $ 394,522
0 248,856 120,177
0 62,111 53,028
0 697,192 822,395
0 189,998 193,627
0 60,081 63,900
16,285 546,131 390,090
16,285 2,260,957 2,037,739
0 311,329 239,491
0 684,417 561,744
0 298,638 223,550
0 137,333 110,074
0 60,445 26,375
0 3,525 7,567
243,488 243,488 1,179,564
0 457,743 403,095
243,488 2,196,918 2,751,460
(227,203) 64,039 (713,721)
44,230 283,857 14,560
(184,627) (228,857) (4,560)
519,749 535,983 1,221,190
379,352 590,983 1,231,190
152,149 655,022 517,469
99,372 2,797,940 2,280,471
$ 251,521 $ 3,452,962 $ 2,797,940
5
CITY OF ST. JOSEPH, MINNESOTA
COMBINED STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL -
GENERAL AND SPECIAL REVENUE FUND TYPES
Year Ended December 31, 1998
General Fund
Over
(Under)
Budget Actual Budget
REVENUES:
General Property Taxes $ 313,475 $ 318,663 $ 5,188
Special Assessments 41,000 40,308 (692)
Licenses and Permits 47,550 62,111 14,561
Intergovernmental 591,809 611,454 19,645
Charges for Services 177,657 189,998 12,341
Fines 65,150 60,081 (5,069)
Miscellaneous 62,000 326,275 264,275
Total Revenues 1,298,641 1,608,890 310,249
EXPENDITURES:
Current -
General Government 257,332 311,329 53,997
Public Safety 636,210 672,956 36,746
Public Works 279,935 298,638 18,703
Culture and Recreation 113,132 137,333 24,201
Economic Development 57,107 60,445 3,338
Miscellaneous 500 300 (200)
Total Expenditures 1,344,216 1,481,001 136,785
REVENUES OVER (UNDER) EXPENDITURES (45,575) 127,889 173,464
OTHER FINANCING (USES):
Operating Transfers Out 0 (44,230) (44,230)
EXCESS OF REVENUES AND OTHER
FINANCING SOURCES OVER (UNDER)
EXPENDITURES AND OTHER FINANCING USES $ (45,575) 83,659 $ 129,234
FUND BALANCE - January 1 1,440,483
FUND BALANCE - December 31 $ 1,524,142
The notes to the financial statements are an integral part of this statement.
Totals
Special Revenue Funds (Memorandum Only)
Over Over
(Under) (Under)
Budget Actual Budget Budget Actual Budget
$ 0 $ 0 $ 0 $ 313,475 $ 318,663 $ 5,188
0 0 0 41,000 40,308 (692)
0 0 0 47,550 62,111 14,561
0 10,000 10,000 591,809 621,454 29,645
0 0 0 177,657 189,998 12,341
0 0 0 65,150 60,081 (5,069)
0 29,310 29,310 62,000 355,585 293,585
0 39,310 39,310 1,298,641 1,648,200 349,559
0 0 0 257,332 311,329 53,997
0 11 ,461 11,461 636,210 684,417 48,207
0 0 0 279,935 298,638 18,703
0 0 0 113,132 137,333 24,201
0 0 0 57,107 60,445 3,338
0 0 0 500 300 (200)
0 11 ,461 11 ,461 1,344,216 1,492,462 148,246
0 27,849 27,849 (45,575) 155,738 201,313
0 0 0 0 (44,230) (44,230)
$ 0 27,849 $ 27,849 $ (45,575) 111,508 $ 157,083
64,751 1,505,234
$ 92,600 $ 1,616,742
6
CITY OF ST. JOSEPH, MINNESOTA
COMBINED STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN RETAINED EARNINGS - ALL PROPRIETARY FUND TYPES
Year Ended December 31,1998
With Comparative Totals for the Year Ended December 31, 1997
Totals
1998 1997
OPERATING REVENUES:
Charges for Services $ 461,393 $ 446,641
OPERATING EXPENSES:
Salaries and Related Taxes and Benefits 105,007 108,844
Utilities 24,187 24,780
Supplies 9,178 7,491
Sewer Use Rental 78,752 82,772
Postage 812 941
Repairs and Maintenance 20,999 13,483
Professional Fees 146 1,215
Fees and Tests 9,716 9,557
Dues and Subscriptions 281 658
Refuse Disposal 82,869 70,815
Depreciation 122,168 121,783
Insurance 13,755 7,255
Miscellaneous 1,397 960
Total Operating Expenses 469,267 450,554
OPERATING LOSS (7,874) (3,913)
NON-OPERATING REVENUES:
Investment Income 46,360 37,940
Other Revenues 13,470 570
Total Non-Operating Revenues 59,830 38,510
INCOME BEFORE OPERATING TRANSFERS 51,956 34,597
Operating Transfers Out (55,000) (10,000)
NET INCOME (LOSS) (3,044) 24,597
RETAINED EARNINGS (DEFICIT) - January 1 (63,628) (88,225)
RETAINED EARNINGS (DEFICIT) - December 31 $ (66,672) $ (63,628)
The notes to the financial statements are an integral part of this statement.
7
CITY OF ST. JOSEPH, MINNESOTA
COMBINED STATEMENT OF CASH FLOWS -
ALL PROPRIETARY FUND TYPES
Year Ended December 31, 1998
With Comparative Totals for the Year Ended December 31, 1997
Totals
1998 1997
CASH FLOWS FROM OPERATING ACTIVITIES:
Operating Loss $ (7,874) $ (3,913)
Adjustments to Reconcile Operating Loss to
Net Cash Provided by Operating Activities:
Depreciation 122,168 121,783
Other Non-operating Revenues 13,470 570
Change in Assets and Liabilities:
(Increase) Decrease in Accounts Receivable (13,475) 8,611
Increase (Decrease) in Accrued Liabilities 14,716 (2,004)
Increase (Decrease) in Due to Other Governmental Units (6,484) 217
Increase (Decrease) in Compensated Absences Payable 2,667 (9)
Total Adjustments 133,062 129,168
Net Cash Provided by Operating Activities 125,188 125,255
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Operating Transfers to Other Funds (55,000) (10,000)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING
ACTIVITIES:
Capital Acquisitions (5,521) (1,386)
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment Income 32,713 37,940
Net Increase in Cash and Cash Equivalents 97,380 151,809
Cash and Cash Equivalents, January 1 678,765 526,956
Cash and Cash Equivalents, December 31 $ 776,145 $ 678,765
Schedule of Noncash Capital Activities:
Contributed Capital $ 0 $ 1,772
The notes to the financial statements are an integral part of this statement.
8
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of St. Joseph, Minnesota, has a mayor-council form of government. A mayor and four
council members are elected by the voters of the City for two-year and four-year terms,
respectively.
The accounting policies of the City conform to generally accepted accounting principles as
applicable to governments. With respect to proprietary activities, the City has adopted GASB
No. 20, "Accounting and Financial Reporting for Proprietary Funds and Other Governmental
Entities that use Proprietary Fund Accounting." The City has elected to apply all applicable
GASB pronouncements as well as Financial Accounting Standards Board (F ASB)
pronouncements, Accounting Principles Board (APB) Opinions and Accounting Research
Bulletins (ARB), issued on or before November 30, 1989 unless those pronouncements conflict
with or contradict GASB pronouncements. In addition, the City has elected not to apply FASBs,
APBs and ARBs issued after November 30, 1989. The following is a summary of the City's
more significant accounting policies.
A. Financial Reporting Entity
In accordance with GASB Statement No. 14, The Financial Reporting Entity, the financial
statements present the City and its component units. The City includes all funds, account
groups, organizations, institutions, agencies, departments, and offices that are not legally
separate from such. Component units are legally separate organizations for which the elected
officials of the City are financially accountable and are included within the financial
statements of the City because of the significance of their operational or financial
relationships with the City.
The City is considered financially accountable for a component unit ifit appoints a voting
majority of the organization's governing body and it is able to impose its will on the
organization by significantly influencing the programs, projects, activities, or level of
services performed or provided by the organization, or there is a potential for the
organization to provide specific financial benefits to, or impose specific financial burdens on,
the City.
As a result of applying the component unit definition criteria above, the City ofSt. Joseph
has been defined in accordance with GASB Statement No. 14 and is presented in this report
as follows:
Blended Component Unit - The St. Joseph Economic Development Authority (ED A) was
organized for the purpose of preserving and creating jobs, enhancing the tax base, and
promoting the general welfare of the people of the City of St. Joseph. The Authority is
governed by a five member board consisting of members of the City Council. The EDA is
included as a blended component unit of the City because the EDA is financially accountable
to the City, and the Authority provides services almost entirely for the City. The St. Joseph
EDA is included as a department in the City's general fund and separate financial statements
are not prepared for the EDA.
9
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
B. Fund Accounting
The accounts ofthe City are organized on the basis of funds and account groups, each of
which is considered a separate accounting entity. The operations of each fund are accounted
for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund
equity, revenues and expenditures or expenses, as appropriate. Government resources are
allocated to and accounted for in individual funds based upon the purposes for which they are
to be spent and the means by which expending activities are controlled. The various funds
are grouped, in the financial statements in this report, into five generic fund types and two
broad fund categories, described below.
Governmental Funds
The General Fund is the general operating fund ofthe City. It is used to account for all
financial resources except those required to be accounted for in another fund.
Special Revenue Funds are used to account for the proceeds of specific revenue sources
(other than expendable trusts or major capital projects) that are legally restricted to
expenditures for specified purposes. The City has five Special Revenue 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. The City has
eight Debt Service Funds.
Capital Proiects Funds are used to account for financial resources to be used for the
acquisition or construction of major capital facilities (other than those financed by
enterprise funds). The City has two Capital Projects Funds.
Proprietary Funds
Enterprise Funds are used to account for operations (a) 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 through user charges; or
(b) where the governing body has decided that periodic determination of revenues earned,
expenses incurred, or net income is appropriate for capital maintenance, public policy,
management control, accountability, or other purposes. The City maintains Refuse,
Water and Sewer Enterprise Funds.
10
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
C. Measurement Focus. Fixed Assets. and Long-Term Liabilities
The accounting and reporting treatment applied to the fixed assets and long-tenn liabilities
associated with a fund are determined by its measurement focus. All governmental funds are
accounted for on a spending or "fmancial flow" measurement focus. This means that only
current assets and current liabilities are generally included on their balance sheets. Their
reported fund balance (net current assets) is considered a measure of "available spendable
resources." Governmental fund operating statements present increases (revenues and other
fmancing sources) and decreases (expenditures and other financing uses) in net current
assets. Accordingly, they are said to present a summary of sources and uses of available
spendable resources during a period.
Fixed assets used in governmental fund type operations (general fixed assets) are accounted
for in the General Fixed Assets Account Group, rather than in governmental funds. Public
domain ("infrastructure") general fixed assets consisting of certain improvements other than
buildings, including roads, curbs and gutters, streets and sidewalks, are not capitalized by the
City. No depreciation has been provided on general fixed assets.
All fixed assets are valued at their historical cost or estimated historical cost if actual
historical cost is not available. Donated fixed assets are valued at their estimated fair value
on the date donated.
Because of their spending measurement focus, expenditure recognition for governmental
fund types is limited to exclude amounts represented by noncurrent liabilities. Since they do
not affect net current assets, such long-term amounts are not recognized as governmental
fund type expenditures or fund liabilities. They are instead reported as liabilities in the
General Long-Term Debt Account Group.
The two account groups, General Fixed Assets and General Long- Tenn Debt, are not
"funds", They are concerned only with the measurement of financial position. They are not
involved with measurement of results of operations.
All proprietary funds are accounted for on a flow of economic resources measurement focus.
This means that all assets and all liabilities (whether current or noncurrent) associated with
the funds' activity are included on their balance sheets. Proprietary fund type operating
statements present increases (revenues) and decreases (expenses) in net total assets.
11
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
C. Measurement Focus. Fixed Assets. and Long-Term Liabilities (Continued)
Major outlays for capital assets and improvements are capitalized in proprietary funds as
projects are constructed. Interest incurred during the construction phase of proprietary fund
fixed assets is reflected in the capitalized value of the asset constructed. Capital assets
constructed in governmental funds for proprietary funds are recorded as contributed capital.
Depreciation of all exhaustible fixed assets used by proprietary funds is charged as an
expense against their operations. Accumulated depreciation is reported on proprietary fund
balance sheets. Depreciation has been provided over the assets' estimated useful lives, which
range from five to fifty years, using the straight-line method. Depreciation expense for the
years ended December 31, 1998 and 1997 is $ 122,168 and $ 121,783, respectively.
D. Basis of Accounting
Basis of accounting refers to when revenues and expenditures or expenses are recognized in
the accounts and reported in the financial statements. Basis of accounting relates to the
timing of the measurement made, regardless ofthe measurement focus applied.
All governmental funds are accounted for using the modified accrual basis of accounting, in
which revenues are recognized when they become measurable and available as net current
assets.
The more significant revenues which have been accrued are intergovernmental revenues and
interest earnings.
Expenditures are generally recognized in the modified accrual basis of accounting when the
related fund liability is incurred. Exceptions to this general rule include sick pay and
principal and interest on generallong-tenn debt, which are recognized when due.
All proprietary funds are accounted for using the accrual basis of accounting; revenues are
recognized when they are earned and expenses are recognized when they are incurred.
E. Budgetary Data
The City Council adopts an annual budget. The amounts shown in the financial statements as
"budget" represent the original budgeted amount and all revisions made during the year. The
City follows these procedures in establishing the budgetary data reflected in the financial
statements.
12
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 1 - SlTh1MARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
E. Budgetary Data (Continued)
1. In August of each year, the City Administrator submits to the City Council a proposed
operating budget for the fiscal year commencing the following January 1. The operating
budget includes proposed expenditures and the means of financing them for the
upcommg year.
2. Public hearings are conducted to obtain taxpayer comment.
3. Prior to December 31, the budget is legally enacted through passage of a resolution.
4. Fonnal budgetary integration is employed as a management control device during the
year for the General and Special Revenue Funds. Fonnal budgetary integration is not
employed for Debt Service Funds because effective budgetary control is alternatively
achieved through general obligation bond indenture provisions. Budgetary control for
Capital Projects Funds is accomplished through the use of project controls.
5. The Budgets for the General and Special Revenue Funds are adopted on a basis
consistent with generally accepted accounting principles (GAAP).
F. Encumbrances
Encumbrances represent outstanding purchase orders and unfulfilled commitments that are
issued to outside vendors and budgeted in the current year but do not include amounts that
are set up as liabilities, amounts for personal services to be perfonned by City employees and
purchase orders applicable to the subsequent year's budget.
As of December 31, 1998, no outstanding encumbrances existed.
G. Cash and Investments (Including Cash Equivalents) (See Note 3)
Cash balances from all funds are combined and invested to the extent available in authorized
investments. Earnings from such investments are allocated to the respective funds on the
basis of applicable cash balance participation by each fund. Investments are carried at fair
value.
For purposes of the statement of cash flows, the City considers all short-tenn, highly liquid
investments with original maturity dates ofthree months or less from the date of purchase to
be cash equivalents. In addition, cash invested in the City's cash management pool is
considered to be cash equivalents. Based on this policy, the total cash and investments of the
proprietary funds are considered to be cash equivalents.
13
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
H. Taxes Receivable
Delinquent taxes receivable represent the past six years of uncollected tax levies.
I. S-pecial Assessments Receivable
Delinquent special assessments represent the past six years of uncollected special
assessments.
Deferred special assessments represent the principal portion of those assessments to property
owners for improvements made by the City. These assessments are made at various times by
City resolution and are collectible over periods ranging from ten to thirty years and bear
annual interest of7 percent to 8 percent and are to be received in 1999 and years thereafter.
J. Deferred Revenue
Deferred revenue represents delinquent taxes and deferred and delinquent assessments
receivable. This revenue is deferred until it is measurable and available as net current assets.
K. Compensated Absences
The City compensates employees who leave City service in good standing for all earned,
unused vacation. In addition, employees are compensated for unused sick leave (up to a
maximum of720 hours) at 50% ofthe current regular rate of pay, provided the City's notice
oftennination policy has been complied with.
L. Fund Equity
Fund equity is divided into sections as follows:
- Contributed capital represents fixed assets purchased by other funds and contributed to
the enterprise funds.
- Investment in General Fixed Assets represents the City's equity in general fixed assets.
- Retained earnings of enterprise funds are subdivided as follows:
The reserved account represents the portion of retained earnings set aside for specific
purposes.
Unreserved retained earnings is available for expending in future periods.
14
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
L. Fund Equity (Continued)
- Fund balance accounts are subdivided as follows:
Reserved accounts indicate the portion of fund balance which has been reserved for a
specific purpose.
Unreserved, designated accounts indicate the portion of fund balance which has been
designated for a specific purpose.
The unreserved, undesignated account is the portion of fund balance which is
available for budgeting and expending in future periods.
M. Revenues, Expenditures and Expenses
1. Revenues
Property taxes and special assessment principal and interest are recognized as revenue
when measurable and available. Portions of taxes paid by the State in the form of HAC A
and other tax credits are included in intergovernmental revenue. Intergovernmental
revenues are reported under the legal and contractual requirements of the individual
programs.
Licenses and pennits, charges for services, fines and forfeits, and miscellaneous revenues
(except investment earnings) are recorded as revenues when received in cash because
they are generally not measurable until then. Investment earnings are recorded when
earned because they are measurable and available.
2. Property Tax Collection Calendar
The City levies its property tax for the subsequent year during the month of December.
December 28 is the last day the City can certify a tax levy to the County Auditor for
collection the following year. The property tax is recorded as revenue when it becomes
measurable and available. Stearns County is the collecting agency for the levy and remits
the collections to the City three times a year. Taxes not collected as of December 31 each
year are shown as delinquent taxes receivable.
15
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
M. Revenues. Exµenditures and Exµenses (Continued)
2. Property Tax Collection Calendar (Continued)
The County Auditor creates the tax list for all taxable property in the City, applying the
applicable tax rate to the tax capacity of individual properties, to arrive at the actual tax
for each property. The çounty Auditor also collects all special assessments, except for
certain prepayments paid directly to the City. The County Auditor turns over the list of
taxes and special assessments to be collected on each parcel of property to the County
Treasurer in January of each year.
The County Treasurer collects all taxes, and all special assessments, except as noted
above. The County Treasurer is required to mail copies of all personal property tax
statements by April 15, and copies of all real estate tax statements by April 15, of each
year.
Property owners are required to pay one-half of their real estate taxes due by May 15 and
the balance by October 15. If taxes due May 15 are not paid on time, a penalty of3% is
assessed on homesteaded property, and 7% on non-homesteaded property. An additiqnal
1 % penalty is added each month the taxes remain unpaid, until October 15. If the taxes
due May 15 are not paid by October 15, a 2% penalty per month is added to homesteaded
property and 4% per month to non-homesteaded property until January 1.
If the taxes are not paid by January 1, further penalties are added. Penalties and interest
apply to both taxes and special assessments. There are some exceptions to the above
penalties, but they are not material.
Within 30 days after the tax settlement date, the County Treasurer is required to pay 70%
of the estimated collections of taxes and special assessments to the City Treasurer. The
County Treasurer must pay the balance to the City Treasurer within 60 days after
settlement, provided that after 45 days interest accrues.
3. Expenditures
Expenditure recognition for governmental fund types includes only amounts represented
by current liabilities. Since noncurrent liabilities do not affect net current assets, they are
not recognized as governmental fund expenditures or fund liabilities. They are reported
as liabilities in the General Long- Tenn Debt Account Group.
4. Expenses
Enterprise funds recognize expenses when they are incurred.
16
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
N. Interfund Transactions
Quasi-external transactions are accounted for as revenues, expenditures or expenses.
Transactions that constitute reimbursements to a fund for expenditures or expenses initially
made from it that are properly applicable to another fund are recorded as expenditures or
expenses in the fund that is reimbursed.
All other interfund transactions, except quasi-external and reimbursements, are reported as
transfers. Nonrecurring or nonroutine permanent transfers of equity are reported as residual
equity transfers. All other interfund transfers are reported as operating transfers.
O. Total Columns on General Purpose Statements
Total columns on the general purpose financial statements are captioned "memorandum
only" to indicate that they are presented only to facilitate financial analysis. Data in these
columns do not present financial position, results of operations, or cash flows in conformity
with generally accepted accounting principles. Interfund eliminations have not been made in
the aggregation of these data.
P. Comparative Data
Comparative total data for the prior year have been presented in the accompanying financial
statements in order to provide an understanding of changes in the City's financial position
and operations. However, prior year totals by fund type have not been presented in each of
the statements since their inclusion would make the statements unduly complex and difficult
to read.
Comparative data have been restated to reflect reclassifications.
Q. Use of Estimates
The preparation of general purpose financial statements in conformity with 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
expenditures/expenses during the reporting period. Actual results could differ from those
estimates.
17
.... .
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 2 - STEWARDSHIP. COMPLIANCE AND ACCOUNTABILITY
A. Fund Deficits
The following funds have deficit fund balance/retained earnings at December 31, 1998:
Capital Projects Funds-
1998 Street Improvements $ (29,420)
Enterprise Fund -
Sewer (306,861)
These deficits will be eliminated by future revenues, user charges or transfers from other
funds.
B. Expenditures in Excess of Appropriations
Expenditures exceeded appropriations in the following funds for the year ended
December 31, 1998:
Expenditures Appropriation
General Fund $ 1,481,001 $ 1,344,216
Special Revenue Funds:
Community Grant 11,043 0
DARE Program 418 0
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS
A. Assets
1. Cash and Investments (Including Cash Equivalents)
Cash balances ofthe City's funds are combined (pooled) and invested to the extent
available in various investments authorized by Minnesota Statutes. Each fund's portion
ofthis pool (or pools) is displayed on the financial statements as "cash and investments
(including cash equivalents)." For purposes of identifying risk of investing public funds,
the balances and related restrictions are summarized below:
a. Deposits - Minnesota Statutes require that all deposits with financial institutions must
~e collateralized in an amount equal to 110% of deposits in excess of FDIC
Insurance.
18
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31,1998
(Continued)
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
A. Assets (Continued)
1. Cash and Investments (Including Cash Equivalents) (Continued)
a. Deposits - (Continued)
Category 1 - Deposits covered by Federal Depository Insurance (FDIC) and those
deposits collateralized with securities held by the City or by its agent in
the City's name.
Category 2 - Collateralized with securities held by the pledging institutions trust
department or agent in the District's name.
Category 3 - Deposits which are not insured or collateralized; or those deposits where
collateral assignment has not been perfected.
Category Bank Carrying
1 2 3 Balance Amount
-
Bank Accounts $ 221,792 $ 0 $ 58,693 $ 280,485 $ 236,669
Certificates of Deposit 1,151,619 0 0 1,151,619 1,151,619
-
Total Deposits $ 1,373,411 $ 0 $ 58,693 $ 1,432,104 $ 1,388,288
b. Investments - Minnesota Statutes authorize the City to invest in obligations of the
U.S. Treasury, agencies, and instrumentalities, shares of investment companies whose
only investments are in the forementioned securities, obligations of the State of
Minnesota or its municipalities, bankers' acceptances, future contracts, repurchase
and reverse repurchase agreements, and commercial paper of the highest quality with
a maturity of no longer than 270 days. Investments held by the City at year end
classified as to credit risk are as follows:
Category 1 - Insured or registered, or securities held by the City's agent in the City's
name.
Category 2 - Uninsured and unregistered, with securities held by the counterparty's
trust department or agent in the City's name.
Category 3 - Uninsured and unregistered, with securities held by the counterparty or
by its trust department or agent but not in the City's name.
19
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
A. Assets (Continued)
1. Cash and Investments (Including Cash Equivalents) (Continued)
b. Investments - (Continued)
Category Fair Value
1 2 3 of Assets
U.S. Government and - -
Federal Agency Notes
and Bonds $ 1,202,330 $0 $0 $1,202,330
Repurchase Agreements 399,000 0 0 399,000
Negotiable Certificates
of Deposit 873,335 0 0 873,335
Brokered Money Market
Mutual Funds 304,707 0 0 304,707
- -
Total Investments $ 2,779,372 $0 $0 2,779,372
Unclassified as to Risk:
Total Deposits (See
Note 3 A.l.a.) 1,388,288
Petty Cash 220
Total Cash and Investments
(Including Cash Equivalents) $4,167,880
20
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
A. Assets (Continued)
2. Due from Other Governmental Units
The following is a summary of due from other governmental units at December 31, 1998:
State of Stearns
Minnesota County Total
General Fund -
Property Taxes/Special Assessments $ 0 $ 119,032 $ 119,032
Federal Grants 25,766 0 25,766
Total General Fund 25,766 119,032 144,798
Debt Service Funds -
G.O. Improvement Bonds of
1993 - Property Taxes/Special
Assessments 0 7,484 7,484
G.O. Improvement Bonds of
1996 - Property Taxes/Special
Assessments ° 11,071 11,071
G.O. Improvement Bonds of
1998 - Property Taxes/Special
Assessments 0 2,633 2,633
Total Debt Service ° 21,188 21,188
Total $ 25,766 $ 140,220 $ 165,986
3. Fixed Assets
A summary of changes in general fixed assets follows:
Balance Balance
1-1-98 Additions Disposals 12-31-98
Land $ 168,069 $ 55,000 $ (55,500) $ 167,569
Buildings 797,734 53,080 0 850,814
Improvements Other 0
than Buildings 294,480 17,973 (3,211) 309,242
Machinery and Equipment 614,741 4,708 (2,726) 616,723
Office Furniture 90,734 4,980 (788) 94,926
Motor Vehic1es 127,465 100,660 (16,788) 211,337
Other Equipment 195,031 21,700 (6,349) 210,382
Total $ 2,288,254 $ 258,101 $ (85,362) $ 2,460,993
21
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
A. Assets (Continued)
3. Fixed Assets (Continued)
A summary of Enterprise Fund fixed assets at December 31, 1998, is as follows:
Water Sewer
Fund Fund Total
Land and Land Improvements $ 12,996 $ 4,940 $ 17,936
Treatment Plant and Lines 1,442,544 1,874,045 3,316,589
Buildings 0 517,983 517,983
Water Storage Facility 1,236,543 0 1,236,543
Machinery and Equipment 37,434 137,566 175,000
Total Cost 2,729,517 2,534,534 5,264,051
Less: Accumulated Depreciation (401,320) (946,902) (1,348,222)
Net Fixed Assets $ 2,328,197 $ 1,587,632 $ 3,915,829
B. Liabilities
1. Defined Benefit Pension Plans - Statewide
A. Plan Description
All full-time and certain part-time employees ofthe City of St. Joseph are covered by
defmed benefit plans administered by the Public Employees Retirement Association
of Minnesota (PERA). PERA administers the Public Employees Retirement Fund
(pERF) and the Public Employees Police and Fire Fund (PEPFF) which are cost-
sharing, multiple-employer retirement plans. These plans are established and
administered in accordance with Minnesota Statutes, Chapters 353 and 356.
PERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated
Plan members are covered by Social Security and Basic Plan members are not. All
new members must participate in the Coordinated Plan. All police officers, fire-
fighters and peace officers who qualify for membership by statute are covered by the
PEPFF.
22
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31,1998
(Continued)
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
B. Liabilities (Continued)
1. Defined Benefit Pension Plans - Statewide (Continued)
A. Plan Description (Continued)
PERA provides retirement benefits as well as disability benefits to members, and
benefits to survivors upon death of eligible members. Benefits are established by
State Statute, and vest after three years of credited service. The defined retirement
benefits are based on a member's highest average salary for any five successive years
of allowable service, age, and years of credit at termination of service.
Two methods are used to compute benefits for PERF's Coordinated and Basic Plan
members. The retiring member receives the higher of a step-rate benefit accrual
fonnula (Method 1) or a level accrual fonnula (Method 2). Under Method 1, the
annuity accrual rate for a Basic Plan member who retires before July 1, 1997 is 2
percent of average salary for each of the first 10 years of service and 2.5 percent for
each remaining year. The annuity accrual rate for Basic members who retire on or
after July 1, 1997 is 2.2 percent of average salary for each of the first 10 years of
service and 2.7 percent for each remaining year. For a Coordinated Plan member
who retires before July 1, 1997, the annuity accrual rate is 1 percent of average salary
for each of the first 10 years and 1.5 percent for each remaining year. For
Coordinated members who retire on or after July 1, 1997, the annuity accrual rates
increase by 0.2 percent (to 1.2 percent of average salary for each of the first 10 years
and 1.7 percent for each remaining year). Under Method 2, the annuity accrual rate is
2.5 percent of average salary for Basic Plan members and 1.5 percent for Coordinated
Plan members who retire before July 1, 1997. Annuity accrual rates increase 0.2
percent for members who retire on or after July 1, 1997. For PEPFF members, the
annuity accrual rate is 2.65 percent for each year of service for members retiring
before July 1, 1997. Effective July 1, 1997, the annuity accrual rate is increased to
3.0 percent. For all PEPFF members and for PERF members whose annuity is
calculated using Method 1, a full annuity is available when age plus years of service
equal 90. A reduced retirement annuity is also available to eligible members seeking
early retirement.
23
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
B. Liabilities (Continued)
1. Defined Benefit Pension Plans - Statewide (Continued)
A. Plan Description (Continued)
There are different types of annuities available to members upon retirement. A
nonnal annuity is a lifetime annuity that ceases upon the death of the retiree--no
survivor annuity is payable. There are also various types of joint and survivor
annuity options available which will reduce the monthly nonnal annuity amount,
because the annuity is payable over joint lives. Members may also leave their
contributions in the fund upon termination of public service in order to qualify for a
deferred annuity at retirement age. Refunds of contributions are available at any time
to members who leave public service, but before retirement benefits begin.
The benefit provisions stated in the previous paragraphs ofthis section are current
provisions and apply to active plan participants. Vested, tenninated employees who
are entitled to benefits but are not receiving them yet are bound by the provisions in
effect at the time they last terminated their public service.
PERA issues a publicly available financial report that includes financial statements
and required supplementary information for PERF and PEPFF. That report may be
obtained by writing to PERA, 514 St. Peter Street #200, St. Paul, Minnesota, 55102
or by calling (651) 296-7460 or 1-800-652-9026.
B. Funding Policy
Minnesota Statutes Chapter 353 sets the rates for employer and employee
contributions. These statutes are established and amended by the state legislature.
The City makes annual contributions to the pension plans equal to the amount
required by state statutes. PERF Basic Plan members and Coordinated Plan members
are required to contribute 8.75 percent and 4.75 percent, respectively, of their annual
covered salary. PEPFF members are required to contribute 7.60 percent of their
annual covered salary. The City ofSt. Joseph is required to contribute the following
percentages of annual covered payroll: 11.43 percent for Basic Plan PERF members,
5.18 percent for Coordinated Plan PERF members, and 11.40 percent for PEPFF
members. The City's contributions to the Public Employees Retirement Fund for the
years ending December 31, 1998, 1997, and 1996 were $ 11,820, $ 10,798, and
$ 10,028, respectively. The City's contributions to the Public Employees Police and
Fire Fund for the years ending December 31, 1998, 1997, and 1996 were $ 26,954,
$ 24,388, and $ 22,919, respectively. The City's contributions were equal to the
contractually required contributions for each year as set by state statute.
24
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
B. Liabilities (Continued)
2. Defined Contribution - Statewide
The City provides pension benefits for its elected local government officials through a
defmed contribution plan administered by the Public Employees Retirement Association
(PERA). The Public Employees Defined Contribution Plan (PEDCP) is a multi-employer
deferred compensation plan. Elected officials who are covered by a public or private
pension plan because of their employment are not eligible to participate in the PEDCP.
Plan benefits depend solely on amounts contributed to the plan plus investment earnings.
Minnesota Statutes, Chapter 353D.03 requires that both the elected local government
official and the City contribute an amount equal to 5% of the elected local government
official's salary. There is no vesting period required to receive benefits in the PEDCP.
The City's total payroll in the year 1998 was $ 621,959. The City's contributions were
calculated using the base salary amount of $ 18,320. Both the City and the elected local
government official made the required 5% contribution, amounting to $ 916 from each
source, or $ 1,832 in total.
As of June 30, 1997, and for the fiscal year then ended, PERA held no securities issued
by the City or other related parties.
3. Deferred Revenue
Deferred revenue at December 31, 1998, consisted of:
Debt
General Service Total
Taxes Receivable -
Delinquent $ 2,966 $ 1,179 $ 4,145
Special Assessments Receivable -
Deferred 60,078 648,933 709,011
Delinquent 29 0 29
Total $ 63,073 $ 650,112 $ 713,185
25
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
B. Liabilities (Continued)
4. Bonds Payable
The following is a summary of bond transactions for the year ended December 31, 1998:
General
Obligation General
General Special Obligation
Obligation Assessment Revenue Total
Bonds Payable -
January 1, 1998 $ 1,235,000 $ 2,110,000 $ 1,110,000 $ 4,455,000
Bonds Issued 0 545,000 0 545,000
Bonds Retired (35,000) (125,000) (55,000) (215,000)
Bonds Payable -
December 31, 1998 $ 1,200,000 $ 2,530,000 $ 1,055,000 $ 4,785,000
Bonds outstanding at December 31, 1998, comprise the following issues:
General Obligation Bonds:
$ 1,235,000 General Obligation Bonds of 1997
due in annual installments of$ 35,000 to $ 100,000
through December 1, 2017, interest at 4.00 to 5.75
percent $ 1,200,000
General Obligation Special Assessment Bonds:
$ 200,000 General Obligation Improvement Bonds of
1992 due in annual installments of$ 10,000 to $ 20,000
through December 1, 2007, interest at 4.60 to 6.40 percent 150,000
$ 365,000 General Obligation Improvement Bonds of 1992-
Series B due in annual installments of$ 15,000 to $ 35,000
through December 1, 2008, interest at 4.50 to 6.60 percent 275,000
26
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1997
(Continued)
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
B. Liabilities (Continued)
4. Bonds Payable (Continued)
General Obligation Special Assessment Bonds: (Continued)
$ 550,000 General Obligation Improvement Bonds of 1993
due in annual installments of$ 25,000 to $ 50,000 through
December 1, 2008, interest at 3.00 to 5.30 percent $ 405,000
$ 1,280,000 General Obligation Improvement Bonds of 1996
due in annual installments of$ 60,000 to $ 120,000 through
December 1, 2011, interest at 4.30 to 5.90 percent 1,155,000
$ 545,000 General Obligation Improvement Bonds of 1998
due in annual installments of$ 25,000 to $ 50,000 through
December 1,2013, interest at 3.85 to 5.00 percent 545,000
Total General Obligation Special Assessment Bonds 2,530,000
General Obligation Revenue Bonds:
$ 475,000 General Obligation Water Revenue Bonds of 1992
due in annual installments of $ 30,000 to $ 50,000 through
December 1, 2005, interest at 4.00 to 6.00 percent 315,000
$ 780,000 General Obligation Water Revenue Bonds of 1996
due in annual installments of $ 20,000 to $ 70,000 through
December 1,2016, interest at 4.30 to 6.00 percent 740,000
Total General Obligation Revenue Bonds 1,055,000
TOTAL BONDS PAYABLE $ 4,785,000
The annual requirements to amortize all bonded debt outstanding as of December 31,
1998, including interest payments of $ 2,330,856 are:
27
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
B. Liabilities (Continued)
4. Bonds Payable (Continued)
General
Obligation General
Year Ending General Special Obligation
December 31, Obligation Assessment Revenue Total
1999 $ 98,007 $ 295,626 $ 119,798 $ 513,431
2000 101,555 291,028 121,777 514,360
2001 99,835 288,037 123,418 511 ,290
2002 103,055 289,563 119,672 512,290
2003 100,985 295,425 115,835 512,245
2004-2008 514,095 1,427,555 446,535 2,388,185
2009-2013 520,660 645,385 354,835 1,520,880
2014 and Beyond 424,175 0 219,000 643,175
Totals $ 1,962,367 $ 3,532,619 $ 1 ,620,870 $ 7,115,856
C. Fund Equity
Fund equity balances are classified as follows to reflect the limitations and restrictions of the
respective funds:
1. Fund Balance
a. Reserved Fund Balance -
Reserved fund balance of$ 1,865,640 represents amounts legally reserved for future
debt service payments and capital projects.
28
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
C. Fund Equity (Continued)
1. Fund Balance (Continued)
b. Unreserved fund balance is comprised of the following:
Special Capital
General Revenue Projects Total
Designated for Fire $ 492,563 $ ° S ° $ 492,563
Designated for Fire Hall 105,085 ° ° 105,085
Designated for Capital
Expenditures (2,861) ° ° (2,861)
Designated for Debt Service 174,745 ° ° 174,745
Designated for Working Capital 250,000 ° ° 250,000
Undesignated 504,610 92,600 (29,420) 567,790
Total Unreserved
Fund Balance $ 1,524,142 $ 92,600 $ (29,420) $ 1,587,322
2. Contributed Capital
Contributed capital in the Enterprise Funds represents fixed assets which were purchased
by other funds and transferred to the Enterprise Funds. Contributed capital is as follows:
Balance, December 31, 1997 $ 4,831,186
Capital Contributed in 1998 0
Balance, December 31,1998 $ 4,831,186
29
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 4 - SEGMENT INFORMATION FOR ENTERPRISE FUNDS
The City maintains three Enterprise Funds which provide refuse, water and sewer services.
Segment infonnation for the year ended December 31, 1998, is:
Refuse Water Sewer
Fund Fund Fund Total
Operating Revenues $ 110,770 $ 167,585 $ 183,038 $ 461,393
Depreciation 0 52,993 69,175 122,168
Operating Income (Loss) 18,717 17,019 (43,610) (7,874)
Operating Transfers Out (10,000) (45,000) 0 (55,000)
Net Income 14,746 (4,731) (13,059) (3,044)
Contributed Capital 0 2,318,285 2,512,901 4,831,186
Fixed Assets -
Acquisitions 0 0 5,521 5,521
Contribut~d Additions 0 0 0 0
Net Working Capital 94,572 135,705 618,408 848,685
Total Assets 102,334 2,482,881 2,227,656 4,812,871
Debt Outstanding 0 1,055,000 0 1,055,000
Total Equity 94,572 2,463,902 2,206,040 4,764,514
NOTE 5 - COMMITMENTS
The City has entered into contracts for certain projects, as follows:
Expended
Proj ect Through
Vendor and Project Authorization December 31, 1998 Commitment
Hardrives, Inc. - 1998 Street
Improvements $ 249,483 $ 219,630 $ 29,853
Randy Kraemer Excavating
91st Avenue Project 161,734 29,787 131,947
30
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
(Continued)
NOTE 6 - RISK MANAGEMENT
The City is exposed to various risk of loss related to torts; theft of, damage to and destruction of
assets; errors and omissions; injuries to employees; and natural disasters. In order to protect
against these risks of loss, the City purchases commercial insurance through the League of
Minnesota Cities Insurance Trust, a public entity risk pool. This pool currently operates
common risk management and insurance programs for municipal entities. The City pays an
annual premium to the League for its insurance coverage. The League of Minnesota Cities
Insurance Trust is self-sustaining through commercial companies for excess claims. The City is
covered through the pool for any claims incurred but unreported, however, retains risk for the
deductible portion of its insurance policies. The amounts of these deductibles are considered
immaterial to the financial statements.
The City's workers compensation insurance policy is retrospectively rated. With this type of
policy, final premiums are determined after loss experience, workers compensation rates and
salaries for the year are known. The final premium adjustment was recorded in the year the
adjustment was made.
During the year ended December 31, 1998, there were no significant reductions in insurance
coverage from the prior year. Settled claims have not exceeded the City's commercial coverage
in any of the past three years.
31
COMBINING AND INDIVIDUAL FUND
FINANCIAL STATEMENTS
CITY OF ST. JOSEPH, MINNESOTA
THE GENERAL FUND
The General Fund accounts for all revenues and expenditures of a governmental unit which are
not accounted for in other funds, and it is usually the largest and most important accounting
activity for state and local governments. It nonnally receives a greater variety and number of
taxes and other general revenues than any other fund. This fund has flowing into it such
revenues as general property taxes, licenses and permits, fines and penalties, rents, charges for
current services, state aids, and interest earnings. The fund's resources also finance a wider range
of activities than any other fund. Most of the current operations of governmental units will be
financed from this fund.
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
COMPARATIVE BALANCE SHEETS
December 31
1998 1997
ASSETS
Cash and Investments $ 1,423,916 $ 1,403,342
Taxes Receivable -
Delinquent 2,966 6,504
Special Assessments Receivable-
Deferred 60,078 88,500
Delinquent 29 175
Accounts Receivable 49,295 18,769
Interest Receivable 24,169 50,344
Due from Other Governmental Units 144,798 81,572
TOTAL ASSETS $ 1,705,251 $ 1,649,206
LIABILITIES AND FUND BALANCE
Liabilities:
Accrued Liabilities $ 70,459 $ 65,497
Deferred Revenue 63,073 95,179
Compensated Absences Payable 47,577 48,047
Total Liabilities 181,109 208,723
Fund Balance:
Umeserved -
Designated 1,019,532 963,006
Undesignated 504,610 477,477
Total Fund Balance 1,524,142 1,440,483
TOTAL LIABILITIES AND FUND BALANCE $ 1,705,251 $ 1,649,206
32
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Year Ended December 31,1998
(With Comparative Actual Totals for the Year Ended December 31, 1997)
1998 1997
Over
(Under)
Budget Actual Budget Actual
REVENUES:
General Property Tax $ 313,475 $ 323,325 $ 9,850 $ 283,658
Tax Increments 0 (4,662) (4,662) 3,189
Special Assessments 41,000 40,308 (692) 33,197
Licenses and Permits 47,550 62,111 14,561 53,028
Intergovernmental -
Federal Grants 19,138 37,912 18,774 22,647
State -
Local Government Aid 447,344 447,344 0 428,293
HACA 60,754 61,779 1,025 61,657
Local Performance Aid 5,840 5,840 0 4,853
Police Aid 29,451 23,551 (5,900) 20,109
Fire Aid 19,650 21,911 2,261 22,030
Other 5,732 8,387 2,655 11,542
County Grants 3,900 4,730 830 4,730
Total Intergovernmental 591,809 611,454 19,645 575,861
Charges for Services -
General Government 4,450 30,822 26,372 13,395
Public Safety - Fire 159,107 144,353 (14,754) 166,550
Culture and Recreation 14,100 14,823 723 13,682
Total Charges for Services 177 ,657 189,998 12,341 193,627
Fines 65,150 60,081 (5,069) 63,900
Miscellaneous -
Sale of Surplus Property 0 109,342 109,342 5,144
InveshnentIncome 44,000 80,865 36,865 78,633
Refunds and Reimbursements 8,000 80,519 72,519 20,016
Contributions 10,000 55,549 45,549 32,236
Total Miscellaneous 62,000 326,275 264,275 136,029
Total Revenues 1,298,641 1,608,890 310,249 1,342,489
33
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Year Ended December 31, 1998
(With Comparative Actual Totals for the Year Ended December 31, 1997)
(Continued)
1998 1997
Over
(Under)
Budget Actual Budget Actual
EXPENDITURES:
General Government:
Mayor and Council -
Salaries and Benefits $ 27,303 $ 22,485 $ (4,818) $ 23,286
Supplies 400 53 (347) 641
Travel and Conferences 3,000 2,531 (469) 1,433
Advertising 1,450 991 (459) 1,893
Insurance 550 468 (82) 468
Dues and Subscriptions 14,052 8,609 (5,443) 15,782
Other 550 0 (550) 332
Legislative Committees -
Legislative Bodies 2,700 2,970 270 4,035
Other 2,525 1,792 (733) 1,626
Elections -
Supplies 100 219 119 0
Professional Services 7,767 6,341 (1,426) 0
Other 1,900 1,437 (463) 0
Assessing -
Salaries and Benefits 9,689 9,329 (360) 9,279
Supplies 150 30 (120) 105
Travel and Conferences 100 50 (50) 0
Other 300 194 (106) 176
Administration -
Salaries and Benefits 68,396 70,738 2,342 67,260
Supplies and Maintenance 9,350 3,273 (6,077) 6,038
Professional Services 0 630 630 0
Telephone 3,500 2,493 (1,007) 2,828
Travel and Conferences 800 1,146 ·346 538
Insurance 1,600 1,400 (200) 1,360
Capital Expenditures 3,300 1,931 (1,369) 7,054
Other 3,250 2,495 (755) 2,337
Accounting -
Salaries and Benefits 43,867 45,847 1,980 43,650
Supplies 1,500 1,631 131 1,701
Travel and Conferences 400 586 186 280
Other 650 30 (620) 591
Independent Auditing -
Services and Charges 8,000 7,380 (620) 7,550
Legal-
Services and Charges 10,000 15,877 5,877 7,027
34
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Year Ended December 31, 1998
(With Comparative Actual Totals for the Year Ended December 31, 1997)
(Continued)
1998 1997
Over
(Under)
Budget Actual Budget Actual
EXPENDITURES: (Continued)
General Government: (Continued)
Planning and Zoning -
Annexation Fee $ 500 $ 381 $ (119) $ 908
Joint Planning 500 1,247 747 0
Consolidation Study 0 0 0 621
General Government Buildings -
Salaries and Benefits 563 2,689 2,126 796
Supplies and Maintenance 2,620 26,4 72 23,852 2,757
Professional Services 1,750 1,293 (457) 1,523
Telephone 1,200 601 (599) 587
Insurance 1,200 1,000 (200) 1,020
Utilities 8,800 7,718 (1,082) 7,043
Capital Expenditures 2,000 55,012 53,012 561
Cable Access 11,050 1,960 (9,090) 16,405
Total General Government 257,332 311 ,329 53,997 239,491
Public Safety:
Police -
Salaries and Benefits 293,935 297,880 3,945 288,496
Supplies and Maintenance 8,450 5,213 (3,237) 7,837
Professional Services 32,600 26,159 (6,441) 28,360
Travel and Conferences 800 457 (343) 320
Insurance 5,000 4,609 (391) 4,250
Advertising 100 76 (24) 330
Capital Expenditures 2,500 1,800 (700) 395
Other 1,500 1,051 (449) 914
Fire Protection -
Salaries and Benefits 14,560 7,365 (7,195) 7,402
Supplies and Maintenance 18,055 15,908 (2,147) 11,220
Professional Services 66,993 48,194 (18,799) 65,636
Travel and Conferences 3,670 3,455 (215) 2,167
Fire Protection 38,400 31,190 (7,210) 30,615
Insurance 14,995 21,275 6,280 3,855
Utilities 6,730 7,775 1,045 5,181
State Aid Reimbursement 18,615 21,411 2,796 20,530
Pension Relief Fund 6,750 5,621 (1,129) 2,813
Capital Expenditures 49,572 85,872 36,300 43,750
Other 6,785 2,057 (4,728) 3,655
Building Inspection -
Supplies 200 0 (200) 206
Professional Services 12,200 24,229 12,029 12,471
Other 3,100 1,751 (1,349) 2,795
35
.-.-. " - ".' -..,. -..
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Year Ended December 31, 1998
(With Comparative Actual Totals for the Year Ended December 31, 1997)
(Continued)
1998 1997
Over
(Under)
Budget Actual Budget Actual
EXPENDITURES: (Continued)
Public Safety: (Continued)
Communication Service -
Supplies and Maintenance $ 500 $ 1,327 $ 827 $ 324
Telephone 4,800 5,569 769 4,616
Capital Expenditures 500 1,358 858 0
Automotive Service -
Supplies and Maintenance 10,300 14,054 3,754 12,483
Motor Vehicles 10,000 18,625 8,625 0
Emergency Management Service -
Professional Services 400 1,293 893 338
Capital Expenditures 3,000 16,505 13,505 0
Other 250 414 164 0
Animal Control -
Supplies 100 70 (30) 48
Professional Services 800 349 (451) 737
Other 50 44 (6) 0
Total Public Safety 636,210 672,956 36,746 561,744
Public Works:
Ordinance Enforcement -
Salaries and Benefits 290 0 (290) 0
Professional Services 500 97 (403) 489
Other 0 325 325 46
Street Maintenance -
Salaries and Benefits 69,955 67,154 (2,801) 65,622
Supplies and Maintenance 14,000 16,392 2,392 11 ,4 77
Professional Services 100 200 100 7
Travel and Conferences 200 59 (141) 153
Insurance 6,500 5,298 (1,202) 5,625
Utilities 3,650 2,404 (1,246) 3,643
Capital Expenditures 84,300 75,672 (8,628) 23,833
Other 780 511 (269) 430
Industrial Development -
Professional Services 9,000 27,114 18,114 9,253
Ice and Snow Removal -
Salaries and Benefits 19,500 13,526 (5,974) 15,994
Supplies and Maintenance 14,000 6,814 (7,186) 21,899
Capital Expenditures 4,000 0 (4,000) 18,850
Other 2,500 1,200 (1,300) 6,752
36
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Year Ended December 31, 1998
(With Comparative Actual Totals for the Year Ended December 31, 1997)
(Continued)
1998 1997
Over
(Under)
Budget Actual Budget Actual
EXPENDITURES: (Continued)
Public Works: (Continued)
Engineering -
Professional Services $ 15,000 $ 51,533 $ 36,533 $ 12,453
Street Lighting -
Supplies 475 0 (475) 0
Utilities 25,900 20,942 (4,958) 21,654
Capital Expenditures 1,500 3,204 1,704 770
Street Cleaning -
Salaries and Benefits 4,485 3,227 (1,258) 2,490
Supplies and Maintenance 3,000 2,761 (239) 1,916
Travel and Conferences 100 80 (31) 69
Other 200 125 (75) 125
Total Public Works 279,935 298,638 18,703 223,550
Culture and Recreation:
Participant Recreation -
Salaries and Benefits 9,600 10,265 665 10,146
Supplies and Maintenance 800 1,574 774 793
Professional Services 1,700 3,573 1,873 3,719
Insurance 800 600 (200) 680
Advertising 30 57 27 116
Other 1,620 1,117 (503) 1,359
Ball Park and Skating Rink -
Salaries and Benefits 2,690 8,968 6,278 1,997
Supplies and Maintenance 600 912 312 310
Professional Services 0 65 0 0
Utilities 1,100 736 (364) 712
Capital Expenditures 2,000 19,796 17,796 3,403
Maintenance Shop -
Supplies and Maintenance 2,685 2,723 38 2,139
Telephone 810 806 (4) 755
Utilities 960 437 (523) 663
Other 100 4,403 4,303 0
Park Areas -
Salaries and Benefits 31,537 39,675 8,138 32,184
Supplies and Maintenance 10,600 9,112 (1,488) 8,125
Telephone 200 178 (22) 123
Insurance 1,200 1,000 (200) 1,020
Utilities 2,250 3,388 1,138 3,381
Capital Expenditures 39,350 22,745 (16,605) 36,125
Other 425 37 (388) 187
37
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Year Ended December 31, 1998
(With Comparative Actual Totals for the Year Ended December 31, 1997)
(Continued)
1998 1997
Over
(Under)
Budget Actual Budget Actual
EXPENDITURES: (Continued)
Culture and Recreation: (Continued)
Shade Tree Disease Control -
Supplies and Maintenance $ 75 $ 0 $ (75) $ 0
Travel and Conferences 100 35 (65) 0
Community Support -
Insurance 300 200 (100) 255
Other 1,600 4,931 3,331 1,882
Total Culture and Recreation 113,132 137,333 24,201 110,074
Economic Development Authority -
Salaries and Benefits 39,257 38,783 (474) 21,228
Supplies 250 289 39 365
Telephone 1,200 1,297 97 321
Travel and Conferences 2,500 3,323 823 808
Professional Services 5,000 7,500 2,500 0
Capital Expenditures 300 0 (300) 3,028
Other 8,600 9,253 653 625
Total Economic Development 57,107 60,445 3,338 26,375
Miscellaneous:
Other 500 300 (200) 367
Total Expenditures 1,344,216 1,481,001 136,785 1,161,601
REVENUES OVER (UNDER) EXPENDITURES (45,575) 127,889 173,464 180,888
OTHER FINANCING USES:
Operating Transfers Out 0 (44,230) (44,230) (4,560)
EXCESS OF REVENUES OVER (UNDER)
EXPENDITURES AND OTHER
FINANCING USES $ (45,575) 83,659 $ 129,234 176,328
FUND BALANCE - January 1 1,440,483 1,264,155
FUND BALANCE - December 31 $ 1,524,142 $ 1,440,483
38
CITY OF ST. JOSEPH, MINNESOTA
SPECIAL REVENUE FUNDS
Special Revenue Funds are used to account for revenues derived from specific taxes or other
eannarked revenue sources. They are usually required by statute, charter provision, or local
ordinance to fmance particular functions or activities of government.
CITY OF ST. JOSEPH, MINNESOTA
SPECIAL REVENUE FUNDS
COMB~GBALANCESHEET
December 31, 1998
With Comparative Totals for December 31,1997
Recreation Community DARE
Center Grant Program
ASSETS
Cash and Investments $ 31,260 $ 6,048 $ 1,529
Interest Receivable 527 101 0
Total Assets $ 31,787 $ 6,149 $ 1,529
LIABILITIES AND FUND BALANCE
Liabilities:
Accounts Payable $ 0 $ 6,149 $ 0
Fund Balance:
Unreserved -
Undesignated 31,787 0 1,529
Total Liabilities and Fund Balance $ 31,787 $ 6,149 $ 1,529
Lake W obegon Park Totals
Trail Improvements 1998 1997
$ 280 $ 59,000 $ 98,117 $ 64,751
4 0 632 0
$ 284 $ 59,000 $ 98,749 $ 64,751
$ 0 $ 0 $ 6,149 $ 0
284 59,000 92,600 64,751
$ 284 $ 59,000 $ 98,749 $ 64,751
39
CITY OF ST. JOSEPH, MINNESOTA
SPECIAL REVENUE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
Year Ended December 31, 1998
With Comparative Totals for the Year Ended December 31, 1997
Recreation Community DARE
Center Grant Program
REVENUES:
Intergovernmental Revenue $ 0 $ 10,000 $ 0
Miscellaneous -
InveshnentIncome 2,237 438 0
Contributions 0 605 10
Total Revenues 2,237 11,043 10
EXPENDITURES:
Salaries and Benefits 0 3,829 0
Supplies and Maintenance 0 6,249 418
Professional Services 0 965 0
Total Expenditures 0 11,043 418
EXCESS OF REVENUES OVER (UNDER)
EXPENDITURES 2,237 0 (408)
FUND BALANCE - January 1 29,550 0 1,937
FUND BALANCE - December 31 $ 31,787 $ 0 $ 1,529
Lake W obegon Park Totals
Trail Improvements 1998 1997
$ 0 $ 0 $ 10,000 $ 0
20 0 2,695 1,752
0 26,000 26,615 33,260
20 26,000 39,310 35,012
0 0 3,829 0
0 0 6,667 0
0 0 965 0
0 0 11,461 0
20 26,000 27,849 35,012
264 33,000 64,751 29,739
$ 284 $ 59,000 $ 92,600 $ 64,751
40
CITY OF ST. JOSEPH, MINNESOTA
DEBT SERVICE FUNDS
Debt Service Funds are created to account for the payment of interest" and principal on 10ng-tenn,
general obligation debt other than debt issued for and serviced primarily by a governmental
enterprise.
CITY OF ST. JOSEPH, MINNESOTA
DEBT SERVICE FUNDS
COMB~GBALANCESHEET
December 31, 1998
With Comparative Totals for December 31, 1997
General
General Obligation General
Obligation Water Obligation
Improvement Revenue Improvement
Bonds Bonds Bonds
of 1992 of 1992 of 1992-B
ASSETS
Cash and Investments $ 55,379 $ 14,687 $ 235,530
Taxes Receivable -
Delinquent 77 0 0
Special Assessments Receivable -
Deferred 18,500 0 193,346
Delinquent 0 0 0
Accounts Receivable 0 2,263 0
Interest Receivable 929 224 3,952
Due from Other Governmental Units 0 0 0
TOTAL ASSETS $ 74,885 $ 17,174 $ 432,828
LIABILITIES AND FUND BALANCE
Liabilities:
Deferred Revenue $ 18,577 $ 0 $ 193,346
Fund Balance:
Reserved for Debt Service 56,308 17,174 239,482
TOTAL LIABILITIES AND
FUND BALANCE $ 74,885 $ 17,174 $ 432,828
General
General Obligation General
Obligation Water Obligation General General
Improvement Revenue Improvement Obligations Obligations
Bonds Bonds Bonds Bonds Bonds Totals
of 1993 of 1996 of 1996 of 1997 of1998 1998 1997
$ 153,486 $ 407,565 $ 439,695 $ 158,307 $ 68,494 $ 1,533,143 $ 1,161,677
192 0 618 292 0 1,179 2,046
93,111 0 200,543 0 143,433 648,933 605,454
0 0 0 0 0 0 3,584
0 3,537 0 0 0 5,800 6,126
2,586 5,932 7,403 2,669 873 24,568 0
7,484 0 11,071 0 2,633 21,188 25,531
$ 256,859 $ 417,034 $ 659,330 $ 161,268 $ 215,433 $ 2,234,811 $ 1,804,418
$ 93,303 $ 0 $ 201,161 $ 292 $ 143,433 $ 650,112 $ 611,084
163,556 417,034 458,169 160,976 72,000 1,584,699 1,193,334
$ 256,859 $ 417,034 $ 659,330 $ 161,268 $ 215,433 $ 2,234,811 $ 1,804,418
41
CITY OF ST. JOSEPH, MINNESOTA
DEBT SERVICE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
Year Ended December 3 1, 1998
With Comparative Totals for the Year Ended December 31, 1997
. General
General Obligation General
Obligation Water Obligation
Improvement Revenue Improvement
Bonds Bonds Bonds
of 1992 of 1992 of 1992-B
REVENUES:
General Property Taxes $ 8,123 $ 0 $ 0
Special Assessments 39,419 0 28,958
Intergovernmental 0 0 0
Miscellaneous -
Investment Income 3,142 1,858 16,682
Other 0 31,924 23,900
Total Revenues 50,684 33,782 69,540
EXPENDITURES:
Miscellaneous 0 0 0
Debt Service -
Bond Principal 10,000 35,000 20,000
Bond Interest and Fiscal Charges 9,775 19,753 18,280
Total Expenditures 19,775 54,753 38,280
EXCESS OF REVENUES OVER (UNDER)
EXPENDITURES 30,909 (20,971 ) 31,260
OTHER FINANCING SOURCES:
Operating Transfers In 0 0 0
Proceeds From the Sale of Bonds 0 0 0
Total Other Financing Sources 0 0 0
EXCESS OF REVENUES AND OTHER
FINANCING SOURCES OVER (UNDER)
EXPENDITURES 30,909 (20,971) 31,260
FUND BALANCE - January 1 25,399 38,145 208,222
FUND BALANCE - December 31 $ 56,308 $ 17,174 $ 239,482
General
General Obligation General
Obligation Water Obligation General General
Improvement Revenue Improvement Obligation Obligation
Bonds Bonds Bonds Bonds Bonds Totals
of 1993 of 1996 of 1996 of 1997 of 1998 1998 1997
$ 20,310 $ 0 $ 70,979 $ 38,513 $ 0 $ 137,925 $ 107,675
28,358 0 55,069 0 56,744 208,548 86,980
0 0 8,299 67,439 0 75,738 221,534
11,500 21,757 31,328 3,921 2,247 92,435 63,027
0 20,472 5,530 0 0 81,826 114,124
60,168 42,229 171,205 109,873 58,991 596,472 593,340
0 0 0 0 3,225 3,225 7,200
30,000 20,000 65,000 35,000 0 215,000 175,000
21,365 42,715 65,010 65,845 0 242,743 228,095
51,365 62,715 130,010 100,845 3,225 460,968 410,295
8,803 (20,486) 41,195 9,028 55,766 135,504 183,045
0 120,962 5,413 113,252 0 239,627 10,000
0 0 0 0 16,234 16,234 85,224
0 120,962 5,413 113,252 16,234 255,861 95,224
8,803 100,476 46,608 122,280 72,000 391,365 278,269
154,753 316,558 411,561 38,696 0 1,193,334 915,065
$ 163,556 $ 417,034 $ 458,169 $ 160,976 $ 72,000 $ 1,584,699 $ 1,193,334
42
CITY OF ST. JOSEPH, MINNESOTA
CAPITAL PROJECTS FUNDS
Capital Projects Funds are created to account for all resources used for the acquisition of capital
facilities by a governmental unit except those financed by enterprise funds.
CITY OF ST. JOSEPH, MINNESOTA
CAPITAL PROJECTS FUNDS
COMBINING BALANCE SHEET
December 31, 1998
With Comparative Totals for December 31, 1997
1998 90th and 91 st
Street Avenue Totals
Improvements Improvements 1998 1997
ASSETS
Cash and Investments $ 50,798 $ 285,761 $ 336,559 $ 210,065
Accounts Receivable 0 0 0 2,502
Due from Other Governmental Units 0 0 0 25,000
TOTAL ASSETS $ 50,798 $ 285,761 $ 336,559 $ 237,567
LIABILITIES AND FUND BALANCE
Liabilities:
Cash Overdraft $ 0 $ 0 $ 0 $ 72,376
Accrued Liabilities 3,017 4,820 7,837 3,700
Contracts Payable 77,201 0 77,201 62,119
Total Liabilities 80,218 . 4,820 85,038 138,195
Fund Balance (Deficit):
Reserved -
CapnalImprovements 0 280,941 280,941 149,739
Unreserved -
Undesignated (29,420) 0 (29,420) (50,367)
Total Fund Balance (Deficit) (29,420) 280,941 251,521 99,372
TOTAL LIABILITIES
AND FUND BALANCE $ 50,798 $ 285,761 $ 336,559 $ 237,567
43
CITY OF ST. JOSEPH, MINNESOTA
CAP IT AL PROJECTS FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
Year Ended December 31, 1998
With Comparative Totals for the Year Ended December 31, 1997
Water East Minnesota
Filtration Street Fire Hall
Improvements Improvements Improvement
of1996 of1996 Proj ect
REVENUES:
Intergovernmental -
County Grants/Aids $ 0 $ 0 $ 0
Miscellaneous -
lnvesbnentIncome 4,671 888 8,224
Other 0 0 2,502
Total Revenues 4,671 888 10,726
EXPENDITURES:
Capital Outlay -
Construction Costs (2,423) (4,354) (11,826)
Other 0 0 0
Total Expenditures (2,423) (4,354) (11,826)
EXCESS OF REVENUES OVER (UNDER)
EXPENDITURES 7,094 5,242 22,552
OTHER FINANCING SOURCES (USES):
Operating Transfers In 0 0 0
Operating Transfers Out (65,962) (5,413) (113,252)
Proceeds from the Sale of Bonds 0 0 0
Total Other Financing Sources (65,962) (5,413) (113,252)
EXCESS OF REVENUES AND OTHER
FINANCING SOURCES OVER (UNDER)
EXPENDITURES AND OTHER FINANCING
USES (58,868) (171) (90,700)
FUND BALANCE (DEFICIT) - January 1 58,868 171 90,700
FUND BALANCE (DEFICIT) - December 31 $ 0 $ 0 $ 0
1998 90th and 91 st
Klinefelter Street Avenue Totals
Walking Trail Improvements Improvements 1998 1997
$ 0 $ 0 $ 0 $ 0 $ 25,000
0 0 0 13,783 41,098
0 0 0 2,502 800
0 0 0 16,285 66,898
0 219,630 29,787 230,814 1,162,149
3,131 8,422 1,121 12,674 17,415
3,131 228,052 30,908 243,488 1,179,564
(3,131) (228,052) (30,908) (227,203) (1,112,666)
44,230 0 0 44,230 4,560
0 0 0 (184,627) 0
0 207,900 311,849 519,749 1,135,966
44,230 207,900 311,849 379,352 1,140,526
41,099 (20,152) 280,941 152,149 27,860
(41,099) (9,268) 0 99,372 71,512
$ 0 $ (29,420) $ 280,941 $ 251,521 $ 99,372
44
CITY OF ST. JOSEPH, MINNESOTA
ENTERPRISE FUNDS
Enterprise Funds are established to account for the financing of self-supporting activities of
governmental units which render services on a user charge basis to the general public. The most
universal type of governmental enterprise is the public utility engaged in the provision of such
basic services as water, electricity, and natural gas. Sanitary sewer systems financed by user
charges have also assumed the status of public utility operations in many urban areas, and many
cities have combined water and sewer systems under the same management.
CITY OF ST. JOSEPH, MINNESOTA
ENTERPRISE FUNDS
COMBnITNGBALANCESHEET
December 31, 1998
With Comparative Totals for December 31, 1997
Refuse Water Sewer
Fund Fund Fund
ASSETS
Current Assets:
Cash and Cash Equivalents $ 80,531 $ 123,084 $ 572,530
Accounts Receivable 20,358 28,944 57,948
Interest Receivable 1,445 2,656 9,546
Total Current Assets 102,334 154,684 640,024
Fixed Assets:
Land and Land Improvements 0 12,996 4,940
Treatment Plant and Lines 0 1,442,544 1,874,045
Buildings 0 0 517,983
Water Storage Facility 0 1,236,543 0
Machinery and Equipment 0 37,434 137,566
0 2,729,517 2,534,534
Less: Accumulated Depreciation 0 (401,320) (946,902)
Net Fixed Assets 0 2,328,197 1,587,632
TOTAL ASSETS $ 102,334 $ 2,482,881 $ 2,227,656
LIABILITIES AND FUND EQUITY
Current Liabilities:
Accrued Liabilities $ 7,762 $ 6,499 $ 7,683
Due to Other Governmental Units 0 0 7,507
Compensated Absences Payable 0 12,480 6,426
Total Current Liabilities 7,762 18,979 21,616
Fund Equity:
Contributed Capital 0 2,318,285 2,512,901
Retained Earnings -
Unreserved (Deficit) 94,572 145,617 (306,861)
Total Fund Equity 94,572 2,463,902 2,206,040
TOTAL LIABILITIES AND
FUND EQUITY $ 102,334 $ 2,482,881 $ 2,227,656
Totals
1998 1997
$ 776,145 $ 678,765
107,250 93,775
13,647 0
897,042 772,540
17,936 17,936
3,316,589 3,316,589
517,983 517,983
1,236,543 1,236,543
175,000 169,479
5,264,051 5,258,530
(1,348,222) (1,226,054)
3,915,829 4,032,476
$ 4,812,871 $ 4,805,016
$ 21,944 $ 14,735
7,507 6,484
18,906 16,239
48,357 37,458
4,831,186 4,831,186
(66,672) (63,628)
4,764,514 4,767,558
$ 4,812,871 $ 4,805,016
45
CITY OF ST. JOSEPH, MINNESOTA
ENTERPRISE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN RETAINED EARNINGS
Year Ended December 31, 1998
With Comparative Totals for the Year Ended December 31, 1997
Refuse Water Sewer
Fund Fund Fund
OPERATING REVENUES:
Charges for Services $ 110,770 $ 167,585 $ 183,038
OPERATING EXPENSES:
Salaries and Related Taxes and
Benefits 9,573 46,844 48,590
Utilities 0 17,146 7,041
Supplies 286 6,381 2,511
Sewer Use Rental 0 0 78,752
Postage 397 2 413
Repairs and Maintenance 0 13,372 7,627
Professional Fees 135 0 11
Fees and Tests 258 6,255 3,203
Dues and Subscriptions 0 193 88
Refuse Disposal 81,281 0 1,588
Depreciation 0 52,993 69,175
Insurance 0 6,400 7,355
Miscellaneous 123 980 294
Total Operating Expenses 92,053 150,566 226,648
OPERATING INCOME (LOSS) 18,717 17,019 (43,610)
NON-OPERATING REVENUES
Investment Income 6,029 9,780 30,551
Other Revenues 0 13,470 0
Total Non-Operating Revenues 6,029 23,250 30,551
INCOME (LOSS) BEFORE OPERATING
TRANSFER 24,746 40,269 (13,059)
Operating Transfer Out (10,000) (45,000) 0
NET INCOME 14,746 (4,731) (13,059)
RETAINED EARNINGS (DEFICIT) - January 1 79,826 150,348 (293,802)
RETAINED EARNINGS (DEFICIT) - December 31 $ 94,572 $ 145,617 $ (306,861)
Totals
1998 1997
$ 461,393 $ 446,641
105,007 108,844
24,187 24,780
9,178 7,491
78,752 82,772
812 941
20,999 13,483
146 1,215
9,716 9,557
281 658
82,869 70,815
122,168 121,783
13,755 7,255
1,397 960
469,267 450,554
(7,874) (3,913)
46,360 37,940
13,470 570
59,830 38,510
51,956 34,597
(55,000) (10,000)
(3,044) 24,597
(63,628) (88,225)
$ (66,672) $ (63,628)
46
CITY OF ST. JOSEPH, MINNESOTA
ENTERPRISE FUNDS
COMBINING STATEMENT OF CASH FLOWS
Year Ended December 31, 1998
With Comparative Totals for the Year Ended December 31, 1997
Refuse Water Sewer
Fund Fund Fund
CASH FLOWS FROM OPERATING ACTIVITIES:
Operating Income (Loss) $ 18,717 $ 17,019 $ (43,610)
Adjustments to Reconcile Operating Income
(Loss) to Net Cash Provided by Operating
Activities:
Depreciation 0 52,993 69,175
Other Non-Operating Revenues 0 13,470 0
Change in Assets and Liabilities:
(Increase) Decrease in Accounts
Receivable (2,314) (5,542) (5,619)
Increase (Decrease) in Accrued
Liabilities 7,482 (1,185) 8,419
Increase (Decrease) in Due to Other
Governmental Units 0 0 (6,484)
Increase (Decrease) in Compensated
Absences Payable 0 2,253 414
Total Adjustments 5,168 61,989 65,905
Net Cash Provided by Operating Activities 23,885 79,008 22,295
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES:
Operating Transfer to Other Fund (10,000) (45,000) 0
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:
Capital Acquisitions 0 0 (5,521)
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment Income 4,584 7,124 21,005
Net Increase in Cash and Cash Equivalents 18,469 41,132 37,779
Cash and Cash Equivalents, January 1 62,062 81,952 534,751
Cash and Cash Equivalents, December 31 $ 80,531 $ 123,084 $ 572,530
Totals
1998 1997
$ (7,874) $ (3,913)
122,168 121,783
13,470 570
(13,475) 8,611
14,716 (2,004)
(6,484) 217
2,667 (9)
133,062 129,168
125,188 125,255
(55,000) (10,000)
(5,521) (1,386)
32,713 37,940
97,380 151,809
678,765 526,956
$ 776,145 $ 678,765
47
CITY OF ST. JOSEPH, MINNESOTA
STATEMENT OF GENERAL LONG-TERM DEBT
December 31,1998
1998 1997
AMOUNTAV~ABLEANDTOBEPROVIDEDFOR
THE PAYMENT OF GENERAL LONG-TERM DEBT:
Amount Available in Debt Service Funds $ 1,584,699 $ 1,193,334
Amount to be Provided from Special Assessments 648,933 609,038
Amount to be Provided for Compensated Absences Payable 58,865 49,897
Amount to be Provided for Retirement of General Long-Term
Debt 2,551,368 2,652,628
TOTAL AVAILABLE AND TO BE PROVIDED $ 4,843,865 $ 4,504,897
GENERAL LONG-TERM DEBT:
Compensated Absences Payable $ 58,865 $ 49,897
Bonds Payable 4,785,000 4,455,000
TOTAL GENERAL LONG-TERM DEBT $ 4,843,865 $ 4,504,897
48
CITY OF ST. JOSEPH, MINNESOTA
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL
REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN
ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
March 10, 1999
Honorable Mayor and City Council
City ofSt. Joseph
St. Joseph, Minnesota
We have audited the financial statements of City of St. Joseph, Minnesota as of and for the year
ended December 31, 1998, and have issued our report thereon dated March 10, 1999, which was
qualified due to the omission of the disclosures about Year 2000 issues. Except for this
omission, we conducted our audit in accordance with generally accepted auditing standards and
the standards applicable to financial audits contained in Government Auditing Standards, issued
by the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether the City's financial statements are free
of material misstatement, we performed tests of its compliance with certain provisions of laws,
regulations, contracts, and grants, noncompliance with which could have a direct and material
effect on the detennination of financial statement amounts. However, providing an opinion on
compliance with those provisions was not an objective of our audit and, accordingly, we do not
express such an opinion. The results of our tests disclosed instances of noncompliance that are
required to be reported under Government Auditing Standards and which are described in the
accompanying Schedule of Findings and Corrective Action Plans on Compliance with Minnesota
Statutes and Internal Controls.
Internal Control Over Financial Reporting
In planning and perfonning our audit, we considered the City's internal control over financial
reporting in order to determine our auditing procedures for the purpose of expressing our opinion
on the financial statements and not to provide assurance on the internal control over financial
reporting. However, we noted certain matters involving the internal control over financial
reporting and its operation that we consider to be reportable conditions. Reportable conditions
involve matters coming to our attention relating to significant deficiencies in the design or
operation of the internal control over financial reporting that, in our judgment, could adversely
affect the City's ability to record, process, summarize and report financial data consistent with
the assertions of management in the financial statements. Reportable conditions are described in
the accompanying Schedule of Findings and Corrective Action Plans on Compliance with
Minnesota Statutes and Internal Controls.
49
A material weakness is a condition in which the design or operation of one or more of the
internal control components does not reduce to a relatively low level the risk that misstatements
in amounts that would be material in relation to the financial statements being audited may occur
and not be detected within a timely period by employees in the nonnal course of perfonning their
assigned functions. Our consideration of the internal control over financial reporting would not
necessarily disclose all matters in the internal control that might be reportable conditions and,
accordingly, would not necessarily disclose all reportable conditions that are also considered to
be material weakness. However, we do not believe the reportable conditions described are
material weaknesses. We also noted other matters involving the internal control over financial
reporting that we have reported to the management ofthe City of St. Joseph, Minnesota in a
separate letter dated March 10, 1999.
This report is intended for the infonnation of management and the City Council. However, this
report is a matter of public record and its distribution is not limited.
f(-t/t.-/t- I /.1- W¿Þ--f~) l/ L.LA-L LTl'::> .
,
KERN, DEWENTER, VIERE, LTD.
50
CITY OF ST. JOSEPH, MINNESOTA
INDEPENDENT AUDITORS' REPORT ON COMPLIANCE
WITH MINNESOTA STATUTES
March 10, 1999
Honorable Mayor and Members of
the City Council
City ofSt. Joseph
St. Joseph, Minnesota
We have audited the financial statements of the City ofSt. Joseph, Minnesota, for the year ended
December 31, 1998, and have issued our report thereon dated March 10, 1999. We conducted
our audit in accordance with generally accepted auditing standards and the provisions of the
Minnesota Legal Compliance Audit Guide for Local Government, promulgated by the Legal
Compliance Task Force pursuant to Minnesota Statute Sec. 6.65. Accordingly, the audit
included such tests ofthe accounting records and such other auditing procedures as we
considered necessary in the circumstances.
The Minnesota Legal Compliance Audit Guide for Local Government covers five main
categories of compliance to be tested: contracting and bidding, deposits and investments,
conflicts of interest, public indebtedness, and claims and disbursements. Our study included all
of the listed categories as well as other statues as we considered necessary in the circumstances.
The results of our tests indicate that for the items tested, the City complied with the material
tenns and conditions of applicable legal provisions, except as described on the Schedule of
Findings and Corrective Action Plans on Compliance with Minnesota Statutes and Internal
Controls. Further, for the items not tested, based on audit and the procedures referred to above,
not~n~ came to our attention to indicate that the City had not complied with such legal
prOVISIons.
This report is intended solely for the use ofthe City and should not be used for any other
purpose. However, this report is a matter of public record and its distribution is not limited.
f{-ú1-/L / lJeWe-I1.-iv..J) V~/ t.-TD.
KERN, DEWENTER, VIERE, LTD.
51
CITY OF ST. JOSEPH, MINNESOTA
FINDINGS AND CORRECTIVE ACTION PLANS ON COMPLIANCE
WITH MINNESOTA STATUTES AND INTERNAL CONTROLS
Year Ended December 31, 1998
CURRENT AND PRIOR YEAR INTERNAL CONTROL FINDING:
The City does not have adequate segregation of duties due to a limited number of office
employees.
CORRECTIVE ACTION PLAN (CAP):
1. Explanation of Disagreement with Audit Finding
There is no disagreement with the audit finding.
2. Actions Planned in Response to Finding
City Council will review current segregation of duties to determine if further segregation
is possible.
3. Official Responsible for Ensuring CAP
Ken Hiemenz, Mayor, is the official responsible for ensuring corrective action of the
deficiency.
4. Planned Completion Date for CAP
The planned completion date for the CAP is December 31, 1999.
5. Plan to Monitor Completion of CAP
The City Council will be monitoring this corrective action plan.
52
CITY OF ST. JOSEPH, MINNESOTA
FINDINGS AND CORRECTIVE ACTION PLANS ON COMPLIANCE
WITH MINNESOTA STATUTES AND INTERNAL CONTROLS
Year Ended December 31, 1998
(Continued)
J
CURRENT YEAR STATE STATUTE FINDING:
Minnesota Statutes Sec. 118.01 and 118.10 provide that all deposits with financial institutions
must be collateralized in an amount equal to 110% of deposits in excess of FDIC insurance. The
deposits of the City were unsecured at First State Bank ofSt. Joseph as follows:
110% of Deposits (Under)
in Excess of FDIC Collateral Secured
At 12/31/98 $ 1,904,215 $ 1,839,653 $ (64,562)
CORRECTIVE ACTION PLAN (CAP):
1. Exµlanation of Disagreement with Audit Finding
There is no disagreement with the audit finding.
2. Actions Planned in Response to Finding
The City Clerk will review collateral requirements on a monthly basis to detennine that
the amount pledged is adequate to comply with Minnesota Statutes.
3. Official Responsible for Ensuring CAP
Ken Hiemenz, Mayor, is the official responsible for ensuring corrective action of the
deficiency.
4. Planned Completion Date for CAP
The planned completion date for the CAP is immediately.
5. Plan to Monitor Completion of CAP
The City Council will be monitoring this corrective action plan.
PRIOR YEAR STATE STATUTE FINDINGS:
None
53