HomeMy WebLinkAbout[05] 2013 Annual Audit, KDVCouncil Agenda Item 5
MEETING DATE: April 17, 2014
AGENDA ITEM: 2013 Audit Presentation — Janel Bitzan, Governmental Audit Manager
SUBMITTED BY: Finance
PREVIOUS COUNCIL ACTION: None
BACKGROUND INFORMATION: Annually the City is required to have an independent audit
completed. The final audited statements are presented to the City Council and submitted to the State of
Minnesota. Janel Bitzan from Kern, DeWenter, Viere (KDV) will be here to provide an overview of the
audit and financial status as of December 31, 2013.
The audited financial statements can be cumbersome to read. Although the entire report is important
for the users of the statements, the Management Discussion and Analysis (MD &A) on pages 5 -21
provide a nice overview of the financial highlights for 2013 and the economic factors that will affect the
upcoming years. City staff prepared the MD &A analysis. The report provided titled "Communications
Letter" is an analysis of the financial condition of the City by KDV.
BUDGET /FISCAL IMPACT
ATTACHMENTS:
Informational only
RCA — Audit Presentation
2013 Audited Financial Statements
2013 Communications Letter
REQUESTED COUNCIL ACTION: Accept the 2013 Audited Financial Statements.
THIS PAGE INTENTIONALLY LEFT BLANK
CITY OF ST. JOSEPH
Stearns County, Minnesota
AUDITED FINANCIAL STATEMENTS
For the Year Ended December 31, 2013
CITY OF ST. JOSEPH
TABLE OF CONTENTS
ELECTED OFFICIALS AND ADMINISTRATION .................................... ...............................
1
INDEPENDENT AUDITOR'S REPORT ...................................................... ...............................
2
MANAGEMENT'S DISCUSSION AND ANALYSIS .................................. ...............................
5
BASIC FINANCIAL STATEMENTS
Government -Wide Financial Statements:
Statement of Net Position ....................................................................... ...............................
24
Statement of Activities ............................................................................ ...............................
25
Fund Financial Statements:
Balance Sheet — Governmental Funds .................................................... ...............................
26
Reconciliation of the Balance Sheet to the Statement of Net Position —
GovernmentalFunds ............................................................................. ...............................
27
Statement of Revenues, Expenditures and Changes in Fund Balances —
GovernmentalFunds ............................................................................. ...............................
28
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund
Balances to the Statement of Activities — Governmental Funds ........... ...............................
29
Statement of Revenues, Expenditures and Changes in Fund Balances — Budget
andActual — General Fund ................................................................... ...............................
30
Statement of Net Position — Proprietary Funds ....................................... ...............................
31
Reconciliation of the Statement of Net Position — Business -Type Activities ........................
32
Statement of Revenues, Expenses and Changes in Fund Net Position — Proprietary
Funds..................................................................................................... ...............................
33
Reconciliation of the Statement of Revenues, Expenses and Changes in Net
Position — Business -Type Activities ..................................................... ...............................
34
Statement of Cash Flows — Proprietary Funds ........................................ ...............................
35
Notes to the Financial Statements ................................................................. ...............................
37
REQUIRED SUPPLEMENTARY INFORMATION
Schedule of Funding Progress — Other Post Employment Benefits .............. ...............................
66
SUPPLEMENTARY INFORMATION
Schedule of Revenues, Expenditures and Changes in Fund Balances — Budget
andActual — General Fund ........................................................................ ...............................
68
Combining Balance Sheet — Nonmaj or Governmental Funds ..................... ...............................
70
Combining Statement of Revenues, Expenditures and Changes in Fund Balances —
NonmajorGovernmental Funds ................................................................ ...............................
76
CITY OF ST. JOSEPH
TABLE OF CONTENTS
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND
ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF
FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH
GOVERNMENT A UDITING STANDARDS ................................................ ............................... 82
REPORT ON LEGAL COMPLIANCE ......................................................... ............................... 84
SCHEDULE OF FINDING AND RESPONSE ON INTERNAL
CONTROL...................................................................................................... ............................... 85
CITY OF ST. JOSEPH
ELECTED OFFICIALS AND ADNIINISTRATION
December 31, 2013
Elected Officials
Position
Term Expires
Rick Schultz
Mayor
January 2015
Robert Loso
Council Member
January 2017
Renee Symanietz
Council Member
January 2017
Steve Frank
Council Member
January 2015
Dale Wick
Council Member
January 2015
Administration
Judy Weyrens
City Administrator
Appointed
Lori Bartlett
Finance Director
Appointed
1
K DV
expert advice. When you need it.'
INDEPENDENT AUDITOR'S REPORT
Honorable Mayor and Members
of the City Council
City of St. Joseph
St. Joseph, Minnesota
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business -type
activities, each major fund and the aggregate remaining fund information of the City of St. Joseph,
Minnesota, as of and for the year ended December 31, 2013, and the related Notes to the Financial
Statements, which collectively comprise the City's basic financial statements as listed in the Table of
Contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted
our audit in accordance with auditing standards generally accepted in the United States of America and
the standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States. Those Standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the City's
preparation and fair presentation of the financial statements in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the City's internal control. Accordingly, we express no such opinion. An audit also includes evaluating
the appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management, as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinions.
2
K.DV
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business -type activities, each major fund,
and the aggregate remaining fund information of the City of St. Joseph, Minnesota, as of December 31,
2013, and the respective changes in financial position and, where applicable, cash flows thereof and the
budgetary comparison for the General Fund for the year then ended in accordance with accounting
principles generally accepted in the United States of America.
Implementation of GASB 65
As discussed in Note 13 to the financial statements, the City has adopted the provisions of the
Governmental Accounting Standards Board (GASB) Statement No. 65, Items Previously Reported as
Assets and Liabilities. Our opinion is not modified with respect to this matter.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management's
Discussion and Analysis, which follows this report letter, and the Schedule of Funding Progress - Other
Post Employment Benefits on page 66 be presented to supplement the basic financial statements. Such
information, although not a part of the basic financial statements, is required by the GASB who
considers it to be an essential part of financial reporting for placing the basic financial statements in an
appropriate operational, economic or historical context. We have applied certain limited procedures to
the required supplementary information in accordance with auditing standards generally accepted in the
United States of America, which consisted of inquiries of management about the methods of preparing
the information and comparing the information for consistency with management's responses to our
inquiries, the basic financial statements and other knowledge we obtained during our audit of the basic
financial statements. We do not express an opinion or provide any assurance on the information because
the limited procedures do not provide us with sufficient evidence to express an opinion or provide any
assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the City's basic financial statements. The combining and individual nonmajor
fund financial statements are presented for purposes of additional analysis and are not a required part of
the basic financial statements.
The combining and individual nonmajor fund financial statements are the responsibility of management
and were derived from and relate directly to the underlying accounting and other records used to prepare
the basic financial statements. Such information has been subjected to the auditing procedures applied
in the audit of the basic financial statements and certain additional procedures, including comparing and
reconciling such information directly to the underlying accounting and other records used to prepare the
basic financial statements or to the basic financial statements themselves, and other additional
procedures in accordance with auditing standards generally accepted in the United States of America. In
our opinion, the combining and individual nonmajor fund financial statements are fairly stated, in all
material respects, in relation to the basic financial statements as a whole.
3
Y DV
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated April 10, 2014
on our consideration of the City's internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts, and grant agreements and other
matters. The purpose of that report is to describe the scope of our testing of internal control over
financial reporting and compliance and the results of that testing, and not to provide an opinion on
internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the City's internal control
over financial reporting and compliance.
V, - / L19
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KERN, DEWENTER, VIERE, LTD.
St. Cloud, Minnesota
April 10, 2014
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
As management of the City of St. Joseph, we offer readers of the City of St. Joseph's financial
statements this narrative overview and analysis of the financial activities of the City of St. Joseph for the
fiscal year ended December 31, 2013.
FINANCIAL HIGHLIGHTS
Key financial highlights for 2013 include the following:
♦ The assets of the City of St. Joseph exceeded its liabilities at the close of the most recent fiscal year
by $ 30,425,969. Of this amount, $ 4,538,373 may be used to meet government's ongoing
obligations to citizens and creditors (unrestricted net position).
♦ The government's total net position decreased by $ 672,711 from 2012 to 2013. The decrease is due
to long -term debt payments, depreciation expense much higher than capital asset additions, capital
addition purchases made with reserved fund balances, and increases in improvement costs to
St. Cloud for the wastewater distribution and treatment system.
♦ As of the close of the current fiscal year, the City of St. Joseph's governmental funds reported
combined ending fund balances of $ 6,373,830, a decrease of $ 1,922,850. Of this amount
$ 1,133,625 is unassigned for spending at the government's discretion. The remaining balance of
$ 5,240,205 is set aside for specific future expenditures.
♦ At the end of the current fiscal year, unassigned fund balance for the general fund was $ 1,134,091
or 43.6% of total general fund expenditures ($ 1,124,825 or 52.6% excluding the fire and PEG
Access funds).
♦ The City of St. Joseph's total long -term debt decreased by $ 140,767 during the current fiscal year.
The decrease was due to a debt paid off for an advanced refunding less than debt issued in 2013.
The debt payments exceeded new debt issued.
OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis is intended to serve as an introduction to the City of St. Joseph's basic
financial statements. The City of St. Joseph's basic financial statements are comprised of three
components: 1) government -wide financial statements, 2) fund financial statements, and 3) notes to the
financial statements. This report also contains other supplementary information in addition to the basic
financial statements themselves.
Government -Wide Financial Statements. The government -wide financial statements are designed to
provide readers with a broader overview of the City of St. Joseph's finances, in a manner similar to a
private- sector business.
The Statement of Net Position presents information on all of the City of St. Joseph's assets and
liabilities, with the difference between the two reported as net position. Over time, increases or
decreases in net position may serve as a useful indicator of whether the financial position of the City of
St. Joseph's is improving or deteriorating.
The statement of activities presents information showing how the government's net position changed
during the most recent fiscal year. All changes in net position are reported as soon as the underlying
event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues
and expenses are reported in this statement for some items that will only result in cash flows in future
fiscal periods (e.g., uncollected taxes and earned but unused vacation leave).
5
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
Both of the government -wide financial statements distinguish functions of the City of St. Joseph that are
principally supported by taxes and intergovernmental revenues (governmental activities) from other
functions that are intended to recover all or a significant portion of their costs through user fees and
charges (business -type activities). The governmental activities of the City of St. Joseph include general
government, public safety, public works, economic development, culture and recreation, and interest on
long -term debt. The business -type activities of the City of St. Joseph include water, sanitary sewer,
refuse, storm water and street light utility services.
The government -wide financial statements include not only the City of St. Joseph itself (known as the
primary government), but also a legally separate Economic Development Authority. Financial
information for this component unit is blended in the financial information.
The government -wide financial statements can be found on pages 24 -25 of this report.
Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain control
over resources that have been segregated for specific activities or objectives. The City of St. Joseph,
like other state and local governments, uses fund accounting to ensure and demonstrate compliance with
finance- related legal requirements. All of the funds of the City of St. Joseph can be divided into two
categories: governmental funds and proprietary funds.
Governmental Funds. Governmental funds are used to account for essentially the same functions
reported as governmental activities in the government -wide financial statements. However, unlike the
government -wide financial statements, governmental fund financial statements focus on near -term
inflows and outflows of spendable resources, as well as on balances of spendable resources available at
the end of the fiscal year. Such information may be useful in evaluating a government's near -term
financing requirements.
Because the focus of governmental funds is narrower than that of the government -wide financial
statements, it is useful to compare the information presented for governmental funds with similar
information presented for governmental activities in the government -wide financial statements. By
doing so, readers may better understand the long -term impact of the government's near -term financing
decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues,
expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison
between governmental funds and government -wide governmental activities.
The City of St. Joseph maintains thirty -two individual governmental funds. Information is presented
separately in the governmental fund balance sheet and in the governmental fund statement of revenues,
expenditures, and changes in fund balances for the general fund which is considered to be a major fund.
Data from the other governmental funds are combined into a single, aggregated presentation. Individual
fund data for each of these non -major governmental funds is provided in the form of combining
statements elsewhere in this report.
The City of St. Joseph adopts an annual appropriated budget for its general fund. A budgetary
comparison statement has been provided for the general fund (page 30) to demonstrate compliance with
this budget.
The basic governmental fund financial statements can be found on pages 26 -30 of this report
rel
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
Proprietary Funds. The City of St. Joseph maintains proprietary funds that are used to report the same
functions presented as business -type activities in the government -wide financial statements. The City of
St. Joseph uses proprietary funds to account for its water, sanitary sewer, refuse, storm water and street
light utility activities.
Proprietary funds provide the same type of information as the government -wide financial statements,
only in more detail. The proprietary fund financial statements provide separate information for the
water, sanitary sewer, refuse, storm water and street light utility, all of which are considered to be major
funds of the City of St. Joseph.
The basic proprietary fund financial statements can be found on pages 31 -35 of this report.
Notes to the Financial Statements. The notes provide additional information that is essential to a full
understanding of the data provided in the government -wide and fund financial statements. The notes to
the financial statements can be found on pages 37 -64 of this report.
Other Information. The combining statements referred to earlier in connection with non -major
governmental funds can be found on pages 68 -81 of this report.
Comparative Data. While comparative data is not illustrated in this report, comments throughout this
narrative and overview will discuss significant changes from the prior year.
GOVERNMENT -WIDE FINANCIAL ANALYSIS
As noted earlier, net position may serve over time as a useful indicator of a government's financial
position. In the case of the City of St. Joseph, assets exceeded liabilities by $ 30,425,969 at the close of
the most recent fiscal year.
By far the largest portion of the City of St. Joseph's net position reflects its investment in capital assets
(e.g., land, buildings, machinery and equipment) net accumulated depreciation, less any related debt
used to acquire those assets that is still outstanding. The City of St. Joseph uses these capital assets to
provide services to citizens; consequently, these assets are not available for future spending. Although
the City of St. Joseph's investment in its capital assets is reported net of related debt, it should be noted
that the resources needed to repay this debt must be provided from other sources, since the capital assets
themselves cannot be used to liquidate these liabilities.
7
NET POSITION
ASSETS:
Current and Other Assets
Capital Assets, Net
Total Assets
LIABILITIES:
Current Liabilities
Long -Term Liabilities
Total Liabilities
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
Governmental Business -Type
Activities Activities Total
2013 2012 2013 2012 2013 2012
$ 8,177,188 $ 10,159,767
10,032,856 10,171,931
18,210,044 20,331,698
1,624,073 2,875,520
5,748,374 6,121,543
7,372,447 8,997,063
NET POSITION:
Invested in Capital Assets,
Net Related Debt 6,289,255 6,355,773
Restricted 5,019,375 5,658,695
Unrestricted (471,033) (679,843)
Total Net Position 10,837,597 11,334,625
$ 7,936,890 $ 6,393,308 $ 16,114,078 $ 16,553,075
30,616,440 30,843,880 40,649,296 41,015,811
38,553,330 37,237,188 56,763,374 57,568,886
5,682,524 934,770 7,306,597 3,810,290
13,282,434 16,189,064 19,030,808 22,310,607
18,964,958 17,123,834 26,337,405 26,120,897
16,865,194 18,836,755 20,868,221
22,263,283
- - 5,019,375
5,658,695
2,723,178 1,276,599 4,538,373
3,526,001
19,588,372 20,113,354 30,425,969
31,447,979
An additional portion of the City of St. Joseph's net position (16.5 %) represents resources that are
subject to external restrictions on how they may be used. The remaining balance of unrestricted net
position, $805,566, may be used to meet the City's ongoing obligations to citizens and creditors.
At the end of the current fiscal year, the City of St. Joseph is able to report positive balances in all three
categories of net position for the government as a whole, as well as for its separate business -type
activities. The governmental activities had positive balances in all, but the unrestricted net position.
The governmental activities total net position balance decreased by 3.1% due to a stabilizing the tax levy
while increasing expenditures, capital spending out of reserved funds, the City opting to minimize
capital projects, and increases in compensated absence liability due to an increased number of full -time
employees.
There was a 1.7% decrease in the total net position for the business -type activities. The decrease is due
to the financial obligation of the City for St. Joseph proportionate share of the improvements to the St.
Cloud wastewater interceptor system and the wastewater treatment facility, and paying down the water
filtration plant debt with fewer connection fees than anticipated for the debt payments. The City issued
a crossover advanced refunding bond in the Water fund. The crossover date is December 1, 2014. Both
the original and refunded bonds are currently shown in the statements until the crossover date.
M.
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
Governmental Activities. Governmental activities reduced the City of St. Joseph's total net position by
$ 497,028. The most significant change in governmental net position is due to increases in accumulated
depreciation far exceeding capital asset additions. The City increased capital spending for equipment
purchased from reserved funds, and capital projects with bond issues postponed in 2012 to 2013 to
offset tax levy reductions and limited state aids. In addition, the Council approved hiring two full -time
staff in positions previously left vacant or at reduced hours. The City experienced little employee turn-
over resulting in accruals at higher amounts for long -term employees. In doing so, the compensated
absence liability increased 7.9 %. Finally, the 2006C street improvement bonds were refunded with a
crossover advanced refunding bond. The crossover date was December 1, 2013 reducing the overall
debt liability by $ 1,585,000.
Business -Type Activities. Business -type activities decreased the City of St. Joseph's net position by
$ 524,982 accounting for the 3.4% decrease in the City's total net position. The largest contributor to the
net position decrease is the sewer and storm water funds. In both cases, the City has opted to spend
down the equity to pay for sewer debt and storm water operations. The sewer fund built up equity in the
early to mid -2000s in preparation to pay for the St. Joseph portion of the St. Cloud wastewater treatment
facility improvements. To offset increasing rates in water and sewer services, the storm water rates were
reduced slightly. Storm water expenses continue to increase with normal inflation; however, the storm
water net position is able to absorb the increases.
The water utility (including the Water Access Charge [WAC] fund) net position increased by $ 1,085,
$ 363,815 decrease without transfers. The City issued debt to construct three new wells in 2005 and a
new water filtration plant in 2006 with the main revenue source new connections or WAC fees. The
City collected more connection fees than was required for the debt payments in 2004 - 2006. The carry-
over balance of the earlier connection fees covered the slower building years in 2007 - 2012. The
building activity increased significantly in 2009 and 2012, but not to the same levels as anticipated in
2005 and 2006 when the debts were approved. The 2013 building activity was slower with 25 new
WAC connections; bond estimates anticipated 85 connections. To help compensate unrealized revenue,
the City Council approved increasing the water rates as well as allocated reserves from the debt service
relief fund to the water fund.
The sewer utility (including the Sewer Access Charge [SAC] fund) net position decreased by $ 286,370.
The decrease is attributable to paying down debt for the St. Cloud projects. St. Joseph set aside
connection fees (SAC fees) and a portion of the sewer usage revenue in anticipation of the current
significant sewer note payments to St. Cloud. The SAC fee reserves will cover the debts through 2015.
New connection fees will add to the reserves and ability to pay future debt payments. In addition,
St. Joseph increased usage fees to help cover costs.
The change in net position in the storm water fund also decreased significantly by $ 63,412. The
Council opted to reduce storm water usage rates to offset larger increases for water and sewer usage
rates. Without depreciation, the storm water fund would have realized an increase in the change in net
position of $ 33,814. The storm water fund is covering approximately 34.8% of depreciation.
Eventually, Council plans to cover 100% of depreciation when the economic conditions improve for
overall rate increases.
26
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
The graphs and charts below and on the following pages summarize and graphically depict the changes
in net position for the governmental and business -type activities.
CHANGE IN NET POSITION
REVENUES:
Program Revenues:
Charges for Services
Operating Grants and
Contributions
Capital Grants and
Contributions
General Revenues:
Property Taxes
Tax Increments
Sales Tax
Franchise Fees
State Aids
Unrestricted Investment Earnings
Gain on Sale of Capital Assets
Total Revenues
Governmental Activities
2013 2012
$ 477,662 $ 512,716
185,693 203,827
407,359 233,124
1,720,770 1,666,126
38,636
98,644
360,902
314,621
117,894
116,668
647,620
648,717
23,861
165,491
-
26,414
3,980,397
3,986,348
Business -Type Activities
2013 2012
$ 2,059,014 $ 1,654,441
8,604 2,373
37,492 216
21,918
2,127,028
94,982
1,752,012
Total
2013 2012
$ 2,536,676 $ 2,167,157
194,297 206,200
444,851 233,340
1,720,770
1,666,126
38,636
98,644
360,902
314,621
117,894
116,668
647,620
648,717
45,779
260,473
- 26,414
6,107,425 5,738,360
EXPENSES:
General Government
547,927
540,533
-
-
547,927
540,533
Public Safety
1,549,009
1,430,047
-
-
1,549,009
1,430,047
Public Works
1,221,092
1,362,907
-
-
1,221,092
1,362,907
Culture and Recreation
152,833
312,173
-
-
152,833
312,173
Economic Development
431,908
186,933
-
-
431,908
186,933
Interest on Long -Term Debt
249,823
361,739
-
-
249,823
361,739
Water
-
-
1,090,286
1,120,823
1,090,286
1,120,823
Sanitary Sewer
-
-
1,003,244
791,275
1,003,244
791,275
Storm Water
-
-
316,087
296,119
316,087
296,119
Refuse
-
-
170,289
169,508
170,289
169,508
Street Light Utility
-
-
47,638
-
47,638
-
Total Expenses
4,152,592
4,194,332
2,627,544
2,377,725
6,780,136
6,572,057
Decrease in Net Position before
Tranfers
(172,195)
(207,984)
(500,516)
(625,713)
(672,711)
(833,697)
Transfers
(169,249)
45,825
169,249
(45,825)
-
-
Change in Net Position
(341,444)
(162,159)
(331,267)
(671,538)
(672,711)
(833,697)
NET POSITION:
Net Position - Beginning
11,334,625
11,496,784
20,113,354
20,784,892
31,447,979
32,281,676
Change in Accounting Principle
(155,584)
-
(193,715)
-
(349,299)
-
Net Position - Beginning Restated
11,179,041
11,496,784
19,919,639
20,784,892
31,098,680
32,281,676
Net Position - Ending
10,837,597
11,334,625
19,588,372
20,113,354
30,425,969
31,447,979
10
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
EXPENSES AND PROGRAM REVENUES — GOVERNMENTAL ACTIVITIES
1,800,000
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
ORevenue
■Expenditures
General Public Safety Public Works Culture and Economic Interest on Long -
Government Recreation Development term Debt
REVENUES BY SOURCE — GOVERNMENTAL ACTIVITIES
General Revenues
73%
General Government
0
Works
are and
reation
1%
11
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
EXPENSES AND PROGRAM REVENUES — BUSINESS -TYPE ACTIVITIES
1,200,000
1,000,000
x:11 111
•11 111
11 111
200,000
Water Sanitary Sewer Refuse Storm Water Street Light
Utility
REVENUES BY SOURCE — BUSINESS -TYPE ACTIVITIES
Ref
14'
Sanitary Se,
37%
gtreet Li At IItlllty
Water
41%
12
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
FINANCIAL ANALYSIS OF THE CITY'S FUNDS AT THE FUND LEVEL
The financial performance of the City of St. Joseph as a whole is reflected in its governmental funds as
well. As the City completed the year, its governmental funds reported a combined fund balance of
$ 6,373,830, a decrease of $ 1,922,850 from 2012. Revenues for the City's governmental funds were
$ 4,371,963, while total expenditures were $ 5,255,744. The excess of expenditures over revenues is
due to hiring two full -time employees and spending reserves for capital planning and outlay.
Expenditures were higher in 2013 due to a refunding debt payment for the 2006C street improvement
bonds. Capital spending for public safety increased substantially as the City purchased air tanks and
turnout gear. The fire department received a $ 91,000 federal grant to help pay for the air tanks.
A summary of financial highlights for each major governmental fund follows.
General Fund
The general fund is the chief operating fund of the City of St. Joseph. At the end of the current fiscal
year, unassigned fund balance of the general fund was $ 1,134,091. As a measure of the general fund's
liquidity, it may be useful to compare unassigned fund balance to total fund expenditures. Unassigned
fund balance represents 43.6% of total general fund expenditures, 52.6% (6.25 months working capital)
after removing the Fire and PEG Access fund. The City Council has a goal to maintain the General
Fund working capital fund balance equal to 4 -6 months of expenditures. Although the General fund
experienced reductions in building permits and miscellaneous revenues, the intergovernmental revenues
increased $ 109,057 to help maintain a healthy fund balance.
General fund expenditures were higher than budgeted by $ 76,143, but under 2012 expenditures by
$ 72,832. In anticipation of Legislative limits to State Aid, the City Council decided to not replace a
full -time police officer and filled a full -time office staff position with temporary workers in previous
years. The council voted to fill the positions in 2013 as full -time. The expenditures decreased mainly
due to larger fire capital purchases made in 2012. The fire department replaced the pumper truck, rescue
van, ATV 6- wheeler and turnout gear in 2012. In 2013 additional turnout gear was purchased along
with replacing the air tanks using a federal grant. The cost of the pumper truck and rescue van came
partially from assigned fund balances.
As a result of the prudent financial policies of the City, the general fund remained stable.
The schedule on the next page presents a summary of General fund revenues and expenditures
13
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
REVENUES:
Taxes
Special Assessment
Licenses and Permits
Intergovernmental
Charges for Services
Fines and Forfeitures
Miscellaneous
Total General Fund Revenue
EXPENDITURES:
General Government
Public Safety
Public Works
Culture and Recreation
Total General Fund Expenditures
December 31,
December 31,
Increase
Percent
2013
2012
(Decrease)
Change
$ 1,270,427
$ 1,220,676
$ 49,751
4%
2,080
845
1,235
146%
97,192
138,631
(41,439)
-30%
884,370
775,313
109,057
14%
244,699
268,653
(23,954)
-9%
45,439
62,065
(16,626)
-27%
82,248
179,018
(96,770)
-54%
$ 2,626,455
$ 2,645,201
$ 18,746
-1%
December 31,
December 31,
Increase
Percent
2013
2012
(Decrease)
Change
$ 503,562
$ 518,442
$ (14,880)
-3%
1,527,118
1,531,939
(4,821)
0%
376,199
400,626
(24,427)
-6%
196,504
225,208
28,704
-13%
$ 2,603,383
$ 2,676,215
$ 72,832
-3%
General Fund Budgetary Highlights
Over the course of the year, the City amended the annual operating budget to move budgeted capital
expenditures to the general capital outlay fund and the park dedication fund. This amendment is
typically an annual revision to the General fund budget. In 2013, the general fund transferred $ 8,500 to
fund the first four months of the street light utility. Historically, the City has minimal budget
amendments during the budget year.
• Actual revenues were $ 95,555 more than expected due to increases in charges for services and
intergovernmental revenues. Charges for services increased in a variety areas. Most
significantly higher than budget came from land use deposits. Intergovernmental revenues had a
large variance over budget due to federal grants received for fire equipment and a FEMA storm
damage reimbursement. Police and fire aid also were higher in 2013.
• Actual expenditures were $ 76,143 more than budget. The fire air packs purchased with a
federal grant were not included in the budget. Other capital costs were budgeted over several
years. The year of purchase will show expenditures over budget. Also, the police chief retired in
2013, paying out accumulated benefits upon retirement.
Proprietary Funds. The City of St. Joseph's proprietary fund statements provide the same type of
information found in the government -wide financial statements, but in more detail. The net position of
the proprietary funds decreased $ 320,231 overall. The paragraphs on the following pages provide a
brief financial overview of each major proprietary fund.
14
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
Water Enterprise Fund
The Water fund is used to account for the operations of the City's water utility. In 2013, the Water
fund's net position increased $ 1,088. Without transfers, the net position would show a decrease of
$ 318,812. The water fund has a couple large debts for the construction of a new water filtration plant
and three new wells to handle growth in the City. The 2005D water revenue debt will be refunded with
the 2012A crossover advanced refunding debt on the December 1, 2014 call date for a savings of
$ 366,766 in interest expense. In anticipation of high debt costs and low development to help pay for
the debts, the City increased rates and budgeted in transfers from the debt service relief fund. The
transfer amount is calculated to show a break -even in the water fund.
Sanitary Sewer Enterprise Fund
The Sanitary Sewer fund is used to account for the operations of the City's sanitary sewer utility. In
2013, the Sanitary Sewer fund's net position decreased $ 286,370 due to growing debt costs for
treatment in St. Cloud and upgrading aged facilities in St. Joseph. As a contract user of the St. Cloud
Wastewater Treatment Facility, St. Joseph is obligated to pay a portion of the costs to maintain the
St. Cloud treatment facility and conveyance system. St. Joseph issued four notes with St. Cloud for
various conveyance and treatment facility projects. In addition, St. Joseph issued a bond in 2012 to
rehabilitate the Sauk River manhole feed from the St. Joseph force main into St. Cloud to reduce toxins
discharged into the wastewater treatment system. In 2013 the City issued a $ 1.875M bond to cover
costs to rehabilitate the Main lift station and sewer mains under CSAH 75. The large debt costs are
partially paid for with reserved sewer connection and trunk fees along with sewer usage rates. The
reserves are estimated to be used up in 2015; however, new development will extend the estimate.
Utility rates have been increased also to offset lower development activity in the past few years.
Refuse Enterprise Fund
The Refuse fund is used to account for the contract services to provide residential refuse, recycling and
compost services. In 2013, the refuse fund's net position increased $ 24,488. The operating revenues
and expenses both increased. The City contracts for refuse hauling. Contracts are renewed every three
years. Bids are very competitive with the number of refuse haulers in the area. The last contract was
awarded in late 2012 with no increase in charges. The City was able to keep rates the same. Compost
rates are reviewed annually with no change in 2013. New in 2013, the City changed from operating a
compost site to outsourcing the service to a local business. Increased use of the compost site and the
City Council's decision to allow St. Wendel Township to utilize the City compost site created a need to
look for alternatives sites as the existing site was no longer sufficient. In reviewing alternatives and
considering land prices, the best option for the City was to outsource the compost service. The
outsourcing of services allowed the City to expand the services and allow additional participants.
Storm Water Enterprise Fund
The storm water fund is used to account for the operations of the City's storm water utility. In 2013, the
storm water fund's net position decreased $ 63,412. The storm water fund had an operating loss of
$ 68,280 or, $ 28,946 surplus after removing depreciation expense. The deficit is due to maintaining
storm water fees without covering much depreciation. The City Council chose to maintain the fees
while still covering some depreciation to allow for larger increases in other funds. The decision was
based on the fund having a healthy net position balance. The storm water fund has not collected any
development fees for the previous five years.
15
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
Street Light Utility Enterprise Fund
The Street Light Utility fund is used to account for the operations of the City's street lighting. In 2013,
the City Council voted to create a street light utility fee to pay for operations of the street lights,
removing the expenditure from the general fund levy. The average household pays $ 3 more per year
while an average business pays $ 173 less per year for street lighting. The new user fee allows the City
to capture revenue from tax exempt properties to help pay for the service provided to them. The City of
St. Joseph is somewhat unique in that over 55% of the City property is classified as tax exempt. To be
fair to all users benefiting from street lighting, the City Council determined a user fee was a more
appropriate way to charge for services. The net position change of the street light utility fund was
positive $ 3,975 at December 31, 2013. Future rate increases and the State sales tax exemption law
change will improve the fund's financial health.
CAPITAL ASSETS AND DEBT ADNIINISTRATION
Capital Assets
The City of St. Joseph's investment in capital assets for its governmental and business -type activities as
of December 31, 2013, amounts to $ 40,649,296 (net of accumulated depreciation), a decrease of
$ 172,790. The investment in capital assets includes land, intangible assets, buildings, improvements,
machinery and equipment, furniture and office equipment, infrastructure, and construction in progress.
Investment in capital assets, net related debt decreased $ 1,395,062. The decrease is attributable to
capital asset replacements for assets fully depreciated and increased debt for the new assets. The overall
debt related to capital assets increased $ 1,427,334 without including the refunded debt paid off in 2013.
There were two significant assets moved from construction in progress to depreciable assets in 2013 for
the St. Cloud treatment facility project and the interceptor phase IV improvements. The depreciation
added for these assets alone accounts for $ 128,993 annually.
The table on the next page is a summary of the City of St. Joseph's capital assets.
16
CAPITAL ASSETS
Land
Easements
Construction in Progress
Improvements
Infrastructure
Buildings
Plant and Lines
Sewer Rights
Machinery and Equipment
Less: Accumulated
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
Governmental Activities
Business -Type Activities
Total
2013
2012
2013
2012
2013
2012
S 457,194
S 457,194
S 377,882
S 377,882
S 835,076 S
835,076
5,820
5,820
67,915
67,915
73,735
73,735
938,569
465,568
84,230
4,789,651
1,022,799
5,255,219
741,872
637,001
-
-
741,872
637,001
16,142,002
16,209,266
-
-
16,142,002
16,209,266
2,511,263
2,479,464
8,120,415
8,120,415
10,631,678
10,599,879
-
-
21,195,993
21,195,993
21,195,993
21,195,993
-
-
8,531,687
3,057,013
8,531,687
3,057,013
3,254,963
3,024,213
670,838
605,590
3,925,801
3,629,803
Depreciation (14,018,827) (13,106,605) (8,432,520) (7,564,294) (22,451,347) (20,670,899)
Total S 10,032,856 S 10,171,921 S 30,616,440 S 30,650,165 S 40,649,296 S 40,822,086
Additional information on the City of St. Joseph's capital assets can be found in note 5 on pages 50 -51
of this report. Total depreciation expense for 2013 was $ 2,040,296.
Long -Term Liabilities
At the end of the current fiscal year, the City of St. Joseph had total net bonded debt outstanding of
$ 24,958,588. Of this amount, $ 6,167,342 comprises debt backed by the full faith and credit of the
government. The remainder of the City of St. Joseph's debt represents bonds and notes secured by
specified revenue sources (i.e. utility and lease revenue bonds). Other long -term debt includes
compensated absences payable and other post employment benefits.
An illustration of the City's long -term liabilities is included in the table on the following page.
17
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
OUTSTANDING LONG -TERM LIABILITIES
Governmental Activities:
General Obligation
General Obligation Special Assessment Bonds
General Obligation Revenue Bonds
Compensated Absences Payable
Net Other Post Employment Benefits
Total Governmental Activities
Business -Type Activities:
General Obligation Revenue Bonds
Notes Payable
Compensated Absences Payable
Net Other Post Employment Benefits
Total Business -Type Activities
$ 6,902,441 $ 8,829,759 -22%
$ 13,233,396
$ 11,809,290
Percent
2013
2012
Change
108,532
120,656
-10%
$ 1,400,758
$ 1,405,068
0%
4,766,584
6,661,327
-28%
180,000
260,000
-31%
395,218
366,195
8%
159,881
137,169
17%
$ 6,902,441 $ 8,829,759 -22%
$ 13,233,396
$ 11,809,290
12%
5,377,850
4,980,569
100%
108,532
120,656
-10%
46,706
39,939
17%
$ 18,766,484 $ 16,950,454 11%
The City of St. Joseph issued $ 2,545,000 General Obligation Bonds, Series 2013A in September 2013.
The bond issue funds three projects: general equipment certificates, sewer pump station revenue bonds
and 2013 street overlay improvement bonds. In addition, the City incurred a note with the City of St.
Cloud in the amount of $ 650,000 for sewer interceptor repairs and took the final draw on the St. Cloud
Public Facilities Authority loan.
The City paid down the net bonded debt by $ 1,979,053 on the governmental activities to end the year.
In 2013, one debt was paid in full with a crossover refunding. The business -type activities saw an
increase in bonded debt of $ 1,851,387 with the issuance of the 2013A sewer revenue bonds and 2013
St. Cloud revenue note. The wastewater treatment plant improvement PFA loan through St. Cloud was
finalized in 2013 with a final draw increase of $ 48,168. A reduction will be seen when the 2005D
water revenue bonds are refunded on December 1, 2014 with the 2012A crossover revenue refunding
bonds.
The City of St. Joseph maintained a bond rating to an "A +" rating from Standard & Poor's for the
general obligation debt in 2013. According to Standard& Poor's municipal credit analysis, the City's
solid bond rating reflects the City's financial operations characterized by maintaining very strong
reserves, good household income levels and moderate overall debt burden. In addition, the proximity to
St. Cloud, Minnesota's diverse employment base lead into the rating provided.
Minnesota state statutes limit the amount of net general obligation debt a governmental entity may issue
to 3% of its taxable market value. Net general obligation debt is debt solely paid for, with limited
exceptions, by ad valorem taxes. The current debt limitation for the City of St. Joseph is $ 9,200,577
which significantly exceeds of the City of St. Joseph's outstanding pure general obligation debt of
$ 1,380,000.
Additional information on the St. Joseph's long -term liabilities can be found in note 6 on pages 52 -56.
IN
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
ECONONHC FACTORS AND NEXT YEAR'S BUDGETS AND RATES
The City of St. Joseph experienced a stable financial position at the end of 2013 despite decreasing
taxable market values, declining development, and increases in St. Cloud sewer charges as evidenced by
the tan rate and General fund reserves.
While the housing market for newly constructed homes has significantly declined, the City of St. Joseph
anticipates growth in both residential and commercial. The construction of a community school (K -8)
will spur development adjacent to the school site as it is open space and a developer has already
preliminary platted a tract for 500+ homes. The new school opened for the 2009 -2010 school year. In
2010 a developer began platting phase 2 of the Rivers Bend development to build 12 patio homes. The
developer has completed the construction of all needed infrastructure and has been marketing the
available building site.. The City of St. Joseph issued six building permits for new homes in 2013.
In 2013 the City of St. Joseph was awarded a $ 600,000 Minnesota Small Cities Development Program
(SCDP) housing rehabilitation grant to correct deficiencies of older, low to moderate income homes in
St. Joseph. A qualified homeowner in the targeted area can receive up to a $ 35,000 0% forgivable
seven year loan to upgrade their home's roofing, exterior, or interior health and safety items that
improve energy efficiency. The homeowner's match is 10 -15% of the construction costs.
The City also anticipates commercial /industrial development with the expansion of the Industrial Park,
development to the west along Interstate 94, and planning initiatives for downtown revitalization. The
first downtown project began construction in 2006 with completion in 2009. The project consists of a
commercial and residential mixed -use facility and is known as the Millstream Shops and Lofts. All
units are occupied. In addition, the downtown commercial spaces were filled with the addition of Retail
Therapy opening in a vacant building. In 2012 the City began designing an 18,000 square foot
government center in the downtown area, replacing the current city hall /police station. The facility will
house city and police employees for the next fifty years and will include a community room with a
caterer's kitchen. The community room will seat 168 occupants. Construction is projected to begin in
spring 2014.
In 2009 the Coborn's PUD was approved which contained three commercial development sites. The
PUD is located on CSAH 75 and CR133, one of the major commerce corridors in St. Joseph.
CentraCare medical clinic, Cobom's Superstore (including grocery and liquor stores) and Central MN
Credit Union currently occupy the development site. A recent market study of the St. Joseph area
indicated that the trade area of St. Joseph would increase by 150% if a grocery store was added to the
landscape of the City. In late 2012, McDonald's opened in the adjacent area. The McDonald's site has
three adjacent vacant commercial lots.
The City Council has also identified an area near Interstate 94 for future commercial development and
focused on planning the infrastructure expansion and land use during 2008 -2009. With the completion
of the realignment of County Road 2, the City Council authorized the annexation of over 92 acres of
property south and east of Minnesota Street, adjacent to I -94 and CR 2 in early 2014. The commerce
potential at the intersection of I -94 and CR 2 is an opportunity for St. Joseph to diversify its tax base.
The City is working with land owners in the area to plan for infrastructure expansion and look for
potential developers. A hotel chain is aggressively working with the land owners to purchase a lot for
construction in 2014.
19
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
The City of St. Joseph is also working with a developer to construct a $ 3.4 M downtown project to
mirror the project described above as the Millstream Shops and Lofts. The proposed project is expected
to begin construction in 2014 and will include a combination of restaurant, retail and residential flats.
Other developments include a 24 unit phase one senior development near downtown consisting of
cottage homes, twin homes, and an eight -plex assisted living unit; plumbing and mechanical business
building expansion, 12,000 sq. ft. commercial addition and industrial office build -out. JLT Partnership,
LLC was approved to develop ten patio -bay townhomes in the Graceview development for construction
to begin in 2014. In fall 2013, a business proposed a special use permit to add a rustic wedding and
conference destination on their property near the industrial park. Construction and events are planned
for 2014.
The St. Joseph Economic Development Authority (EDA) is an active group promoting business interests
within the St. Joseph Community. The EDA continues to work with property owners to develop
industrial and commercial sites. The EDA is also working with the Comprehensive Economic
Development Strategy (CEDS) to attract businesses from around the country to the area and to provide
opportunity for possible federal grant funding. In addition, the EDA is working on a plan to identify and
revitalize the downtown area to attract people to the area.
Property tax reforms and budget deficits at the state level have significantly impacted government aid
payments made to the City. Further, the taxable market value on properties has decreased slightly. The
Council continues to budget conservatively to keep minimal increases in the tax rate. As the Nation's
economic instability continues, the City is monitoring the federal and state legislation with the impacts
on the local government.
The City annually reviews the fee structures for all licenses and permits and services to recover
appropriate costs in lieu of raising property taxes.
The City's rate structure for the utilities is established to help cover not only the operating costs but the
depreciation as well. Water and sanitary sewer is charged from the first gallon used with a separate line
charge to recover current and future capital replacements. This structure began in 2006 to promote
water conservation. Residential sewer rates are capped at the water used for the November/December
billing. The City monitors the rates annually so that the rates cover operation and depreciation. The City
has a long -term goal of covering depreciation fully through rates.
The City of St. Joseph is part of the St. Cloud Wastewater System. The wastewater system is managed
in part by the St. Cloud Area Wastewater Advisory Committee (SCAWAC) of which each city has
representation. SCAWAC has identified the need improve the treatment portion of the wastewater
system and repair several failing sewer interceptors and lift stations. St. Cloud set up a tiered schedule
of improvements to the collection system. The improvements are either paid for with cash on hand or
General Obligation Sewer Revenue bonds. The bonds are issued to St. Cloud with schedules of each
city's allocation of costs to pay St. Cloud. In 2013, SIS phase IV bonds were issued. St. Joseph's share
was $650,000. In addition, the Public Facilities Authority (PFA) loan for the treatment facility
improvements were closed out in August 2013. The final cost to the City of St. Joseph was $4,824,675,
a savings of $56,981 from the estimated costs.
20
CITY OF ST. JOSEPH
Stearns County, Minnesota
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2013
All the factors were considered in preparing the City of St. Joseph's budget and fee schedule for the
2013 and future reporting years. As the City looks forward to 2014, improvement projects are planned
to rehabilitate the water tower, reconstruct street and utilities in the Park Terrace neighborhood, and
replace the government center. The property owners along I -94, CR121 and downtown are considering
new developments. To encourage development, the City Council approved subsidizing water and sewer
access charges for the first ten single family homes built in 2014. The subsidy comes from debt service
relief funds. A busy year is planned in 2014.
REQUESTS FOR INFORMATION
The financial report is designed to provide a general overview of the City of St. Joseph's finances for all
those with an interest in the City's finances. Questions concerning any of the information provided in
this report or requests for additional financial information should be addressed to the Finance Director,
PO Box 668, 25 College Avenue North, St. Joseph, MN 56374.
21
(THIS PAGE LEFT BLANK INTENTIONALLY)
22
BASIC FINANCIAL STATEMENTS
23
CITY OF ST. JOSEPH
STATEMENT OF NET POSITION
December 31, 2013
Governmental
Business -Type
Activities
Activities
Total
ASSETS
Cash and Investments
(Including Cash Equivalents)
$ 6,018,051
$ 2,879,129
$ 8,897,180
Cash with Fiscal Agent
-
4,682,985
4,682,985
Property Tax Receivable
50,790
-
50,790
Accounts Receivable
76,240
334,947
411,187
Interest Receivable
1,392
1,165
2,557
Due from Other Governments
114,494
-
114,494
Due from Other Funds (Internal Balances)
4,000
(4,000)
-
Notes Receivable
29,035
-
29,035
Special Assessments Receivable:
Delinquent
137,554
604
138,158
Deferred
1,726,132
42,060
1,768,192
Prepaid Expenses
19,500
-
19,500
Capital Assets:
Land
457,194
377,882
835,076
Easements
5,820
67,915
73,735
Construction in Progress
938,569
84,230
1,022,799
Buildings
2,511,263
8,120,415
10,631,678
Infrastructure
16,142,002
-
16,142,002
Improvements
741,872
-
741,872
Plant and Lines
-
21,195,993
21,195,993
Machinery and Equipment
3,254,963
670,838
3,925,801
Sewer Rights
-
8,531,687
8,531,687
Less Accumulated Depreciation
(14,018,827)
(8,432,520)
(22,451,347)
Capital Assets (Net of Accumulated Depreciation)
10,032,856
30,616,440
40,649,296
Total Assets
$ 18,210,044
$ 38,553,330
$ 56,763,374
LIABILITIES AND NET POSITION
Liabilities
Accounts Payable
$ 246,438
$ 38,174
$ 284,612
Contracts Payable
152,282
8,208
160,490
Due to Other Governments
4,438
50,401
54,839
Salaries and Benefits Payable
43,306
7,653
50,959
Interest Payable
23,542
94,038
117,580
Bond Principal Payable (Net):
Payable Within One Year
1,135,000
5,180,000
6,315,000
Payable After One Year
5,212,342
8,053,396
13,265,738
Notes Payable (Net):
Payable Within One Year
-
301,494
301,494
Payable After One Year
-
5,076,356
5,076,356
Compensated Absences Payable:
Payable Within One Year
19,067
2,556
21,623
Payable After One Year
376,151
105,976
482,127
Net Other Post Employment Benefits (OPEB) Obligation
159,881
46,706
206,587
Total Liabilities
7,372,447
18,964,958
26,337,405
Net Position
Net Investment in Capital Assets
6,289,255
16,865,194
20,868,221
Restricted for:
Debt Service
3,636,146
-
3,636,146
Other Purposes
1,383,229
-
1,383,229
Unrestricted
(471,033)
2,723,178
4,538,373
Total Net Position
10,837,597
19,588,372
30,425,969
Total Liabilities and Net Position
$ 18,210,044
$ 38,553,330
$ 56,763,374
The Notes to the Financial Statements are an integral part of this statement.
24
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25
CITY OF ST. JOSEPH
BALANCE SHEET - GOVERNMENTAL FUNDS
December 31, 2013
ASSETS
Cash and Investments
Taxes Receivable - Delinquent
Special Assessments Receivable:
Delinquent
Deferred
Accounts Receivable
Interest Receivable
Due from Other Funds
Due from Other Governments
Notes Receivable
Prepaid Expenses
Total Assets
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities
Accounts Payable
Contracts Payable
Due to Other Funds
Due to Other Governments
Salaries and Benefits Payable
Total Liabilities
Deferred Inflows Of Resources
Unavailable Revenue - Property Taxes
Unavailable Revenue - Special Assessments
Unavailable Revenue - Notes Receivable
Total Deferred Inflows of Resources
Fund Balances
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total Fund Balances
Total Liabilities, Deferred Inflows
of Resources and Fund Balances
General Fund
Other
Total
(101, 105,
Governmental
Governmental
108)
Funds
Funds
$ 1,707,989
$ 4,895,965
$ 6,603,954
37,083
13,707
50,790
1,169
136,385
137,554
5,494
1,720,638
1,726,132
57,708
19,032
76,740
518
1,088
1,606
4,000
500
4,500
12,168
102,326
114,494
-
29,035
29,035
19,500
-
19,500
$ 1,845,629 $ 6,918,676 $ 8,764,305
$ 32,908
$ 213,530
$ 246,438
-
152,282
152,282
-
500
500
4,438
-
4,438
43,306
-
43,306
80,652
366,312
446,964
$ 37,083
$ 13,707
$ 50,790
6,663
1,857,023
1,863,686
-
29,035
29,035
43,746
1,899, 765
1,943, 511
19,500
-
19,500
6,870
3,180,613
3,187,483
-
112,486
112,486
560,770
1,359,966
1,920,736
1,134,091
(466)
1,133,625
1,721,231
4,652,599
6,373,830
$ 1,845,629 $ 6,918,676 $ 8,764,305
The Notes to the Financial Statements are an integral part of this statement. 26
CITY OF ST. JOSEPH
RECONCILIATION OF THE BALANCE SHEET TO
THE STATEMENT OF NET POSITION - GOVERNMENTAL FUNDS
December 31, 2013
Total Fund Balances - Governmental Funds $ 6,373,830
Amounts reported for governmental activities in the Statement of Net Position
are different because:
Capital assets used in governmental activities are not current financial resources
and, therefore, are not reported as assets in governmental funds.
Cost of Capital Assets 24,051,683
Less Accumulated Depreciation (14,018,827)
Long -term liabilities, including bonds payable, are not due and payable in
the current period and, therefore, are not reported as liabilities in the funds.
Long -term liabilities at year -end consist of:
Bond Principal Payable, Net of Premiums and Discounts (6,347,342)
Compensated Absences Payable (395,218)
Net OPEB Obligation (159,881)
Delinquent receivables will be collected in subsequent years, but are not
available soon enough to pay for the current period's expenditures and,
therefore, are deferred in the funds.
Property Taxes 50,790
Special Assessments 137,554
Other long -term assets are not available to pay for current expenditures and,
therefore, are deferred in the funds.
Deferred Special Assessments 1,726,132
Notes Receivable 29,035
The Water Access Capital Project Fund is proprietary in nature and, therefore,
included in the business -type activities in the Statement of Net Position. (563)
The Sewer Access Capital Project Fund is proprietary in nature and, therefore,
included in the business -type activities in the Statement of Net Position. (586,054)
Governmental funds do not report a liability for accrued interest
due and payable. (23,542)
Total Net Position - Governmental Activities $ 10,837,597
The Notes to the Financial Statements are an integral part of this statement. 27
�lr�•K00M010.1Nwii
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS
For the Year Ended December 31, 2013
REVENUES
Property Taxes
Tax Increments
Sales Taxes
Special Assessments
Franchise Fees
Licenses and Permits
Intergovernmental
Charges for Services
Fines and Forfeitures
Miscellaneous:
Investment Income
Contributions and Donations
Revolving Loan Repayments
Other
Total Revenues
EXPENDITURES
Current
General Government
Public Safety
Public Works
Culture and Recreation
Economic Development
Debt Service
Principal
Interest and Other Charges
Capital Outlay
General Government
Public Safety
Public Works
Culture and Recreation
Total Expenditures
Excess of Revenues Over
(Under) Expenditures
OTHER FINANCING SOURCES (USES)
Insurance Recoveries
Sale of Property
Bonds Issued
Bond Premium
Refunding Bond Payment
Transfers In
Transfers Out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
FUND BALANCES
Beginning of Year
End of Year
General Fund
Other
Total
(101, 105,
Governmental
Governmental
108)
Funds
Funds
$ 1,152,540
$ 568,510
$ 1,721,050
-
38,636
38,636
(7)
360,909
360,902
2,080
465,416
467,496
117,894
-
117,894
97,192
-
97,192
884,370
44,595
928,965
244,699
227,911
472,610
45,439
-
45,439
442
5,035
5,477
38,174
22,263
60,437
-
8,083
8,083
43,632
4,150
47,782
2,626,455
1,745,508
4,371,963
485,778
-
485,778
1,405,347
-
1,405,347
344,935
117
345,052
196,504
3,446
199,950
-
152,833
152,833
1,210,000 1,210,000
268,566 268,566
17,784
95,703
113,487
121,771
54,006
175,777
31,264
439,966
471,230
-
427,724
427,724
2,603,383
2,652,361
5,255,744
23,072
(906,853)
(883,781)
6,000
-
6,000
629
20,531
21,160
-
670,000
670,000
11,121
11,121
-
(1,435,000)
(1,435,000)
20,416
523,193
543,609
(34,160)
(821,799)
(855,959)
(7,115)
(1,031,954)
(1,039,069)
15,957
(1,938,807)
(1,922,850)
1,705,274
6,591,406
8,296,680
$ 1,721,231
$ 4,652,599
$ 6,373,830
The Notes to the Financial Statements are an integral part of this statement. 28
CITY OF ST. JOSEPH
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES TO THE STATEMENT
OF ACTIVITIES - GOVERNMENTAL FUNDS
For the Year Ended December 31, 2013
Total Net Change in Fund Balances - Governmental Funds $ (1,922,850)
Amounts reported for governmental activities in the Statement of Activities are different because:
Capital outlays are reported in governmental funds as expenditures. However, in the
Statement of Activities, the cost of those assets is allocated over the estimated useful lives
as depreciation expense.
Capital Outlays 1,090,735
Depreciation Expense (1,170,275)
Loss on Disposal (15,476)
Transferred to Proprietary Funds (44,049)
Principal payments on long -term debt are recognized as expenditures in the governmental
funds but as an increase in net position in the Statement of Activities. 1,210,000
Bonds were refunded during the year. The amount paid off with the new funding is reported in
the governmental funds as a use of financing. However, the payments are not expenditures
in the Statement of Activities, but rather a reduction in long -term liabilities in the Statement
of Net Position. 1,435,000
Some expenses reported in the Statement of Activities do not require the use of current
financial resources and, therefore, are not reported as expenditures in governmental funds.
Accrued interest payable 3,569
Amortization of bond discounts, premiums and issuance charges 15,174
Proceeds from long -term debt are recognized as an other financing source in the governmental
funds but as a decrease in net position in the Statement of Activities. (670,000)
The governmental funds report the effect of premiums, discounts and
similar items when debt is first issued, whereas these amounts are deferred and amortized
in the Statement of Activities. (11,121)
Compensated absences and OPEB payments are recognized as paid in the
governmental funds but recognized as the expense is incurred in the Statement of Activities. (51,735)
Delinquent receivables will be collected in subsequent years, but are not available soon enough
to pay for the current period's expenditures and, therefore, are not revenues in the funds.
Delinquent Special Assessments 78,032
Delinquent Property Taxes (280)
Certain revenues in the Statement of Activities that do not provide current financial resources
are not reported as revenues in the funds.
Deferred Special Assessments (292,108)
Notes Receivable (7,096)
The Water Access Capital Project Fund is proprietary in nature and, therefore, is reported
with business -type activities. 20,191
The Sewer Access Capital Project Fund is proprietary in nature and, therefore, is reported
with business -type activities. (9,155)
Change in Net Position - Governmental Activities $ (341,444)
The Notes to the Financial Statements are an integral part of this statement. 29
CITY OF ST. JOSEPH
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES -
BUDGET AND ACTUAL - GENERAL FUND
For the Year Ended December 31, 2013
REVENUES
Property Taxes
Sales Taxes
Special Assessments
Franchise Fees
Licenses and Permits
Intergovernmental
Charges for Services
Fines and Forfeitures
Miscellaneous Revenues:
Investment Income
Contributions and Donations
Other
Total Revenues
EXPENDITURES
Current
General Government
Public Safety
Public Works
Culture and Recreation
Capital Outlay
General Government
Public Safety
Public Works
Culture and Recreation
Total Expenditures
Excess of Revenues Over
(Under) Expenditures
OTHER FINANCING SOURCES (USES)
Insurance Recoveries
Sale of Property
Transfers In
Transfers Out
Original Final
Budget Budget
Variance with
Actual Final Budget -
Amounts Over (Under)
$ 1,154,645
$ 1,154,645
$ 1,152,540
$ (2,105)
-
-
(7)
(7)
1,500
1,500
2,080
580
114,800
114,800
117,894
3,094
90,605
90,605
97,192
6,587
768,335
768,335
884,370
116,035
230,775
230,775
244,699
13,924
62,500
62,500
45,439
(17,061)
26,000
26,000
442
(25,558)
37,590
37,590
38,174
584
44,150
44,150
43,632
(518)
2,530,900
2,530,900
2,626,455
95,555
520,070
520,070
485,778
(34,292)
1,371,315
1,371,315
1,405,347
34,032
361,470
352,970
344,935
(8,035)
214,185
214,185
196,504
(17,681)
6,250
3,000
17,784
14,784
47,545
40,700
121,771
81,071
30,190
25,000
31,264
6,264
10,375
-
-
-
2,561,400
2,527,240
2,603,383
76,143
(30,500)
3,660
23,072
19,412
-
-
6,000
6,000
-
-
629
629
2,000
2,000
20,416
18,416
-
-
(34,160)
(34,160)
Total Other Financing Sources (Uses) 2,000 2,000 (7,115) (9,115)
Net Change in Fund Balances $ (28,500) $ 5,660 15,957 $ 10,297
FUND BALANCES
Beginning of Year 1,705,274
End of Year $ 1,721,231
The Notes to the Financial Statements are an integral part of this statement. 30
CITY OF ST. JOSEPH
STATEMENT OF NET POSITION - PROPRIETARY FUNDS
December 31, 2013
LIABILITIES AND NET POSITION
Current Liabilities
Accounts Payable
$ 4,871
Sanitary Sewer
Refuse
Storm Water
Street Light
$ 38,174
Contracts Payable
Water (60 1)
(602)
(603)
(651)
Utility (652)
Total
ASSETS
593
46,980
2,828
-
50,401
Current Assets
3,799
2,415
654
785
7,653
Cash and Investments
$ 3,590
$ 1,829,480
$ 254,337
$ 205,799
$ 20
$ 2,293,226
Cash with Fiscal Agent
4,682,985
-
-
-
-
4,682,985
Special Assessments Receivable:
Delinquent
78
285
204
37
-
604
Deferred
15,409
3,611
314
22,700
26
42,060
Accounts Receivable
117,494
127,435
59,259
19,656
10,603
334,447
Interest Receivable
575
227
82
68
(1)
951
Total Current Assets
4,820,131
1,961,038
314,196
248,260
10,648
7,354,273
Noncurrent Assets
10,838,785
2,394,611
-
-
13,233,396
Capital Assets:
22,659
18,497
2,775
2,775
46,706
Land
372,941
4,941
-
-
-
377,882
Easements
-
-
10,157
67,915
67,915
Construction in Progress
46,066
31,300
37,055
6,864
6,673
84,230
Buildings
7,502,432
617,983
-
8,120,415
Plants and Lines
8,908,669
7,432,835
-
4,854,489
-
21,195,993
Machinery and Equipment
192,511
430,941
45,540
1,846
3,975
670,838
Sewer Rights
-
8,531,687
-
-
3,975
8,531,687
Total Capital Assets
17,022,619
17,049,687
45,540
4,931,114
10,648
39,048,960
Less Accumulated Depreciation
(3,674,373)
(3,722,155)
(6,506)
(1,029,486)
(8,432,520)
Net Capital Assets
13,348,246
13,327,532
39,034
3,901,628
30,616,440
Total Assets
$ 18,168,377
$ 15,288,570
$ 353,230
$ 4,149,888
$ 10,648
$ 37,970,713
LIABILITIES AND NET POSITION
Current Liabilities
Accounts Payable
$ 4,871
$ 7,073
$ 23,288
$ 269 $
2,673
$ 38,174
Contracts Payable
-
8,208
-
-
-
8,208
Due to Other Governments
593
46,980
2,828
-
50,401
Salaries and Benefits Payable
3,799
2,415
654
785
7,653
Interest Payable
28,852
65,186
-
-
-
94,038
Due To Other Funds
-
-
-
-
4,000
4,000
Long -Term Liabilities Due
Within One Year
5,016,048
467,542
128
332
-
5,484,050
Total Current Liabilities
5,054,163
597,404
26,898
1,386
6,673
5,686,524
Noncurrent Liabilities
Compensated Absences
44,008
44,008
7,510
13,006
-
108,532
Notes Payable, Net
-
5,377,850
-
-
5,377,850
Bonds Payable, Net
10,838,785
2,394,611
-
-
13,233,396
Net OPEB Obligation
22,659
18,497
2,775
2,775
46,706
Less Amounts Due Within One Year
(5,016,048)
(467,542)
(128)
(332)
(5,484,050)
Total Noncurrent Liabilities
5,889,404
7,367,424
10,157
15,449
13,282,434
Total Liabilities
10,943,567
7,964,828
37,055
16,835
6,673
18,968,958
Net Position
Net Investment in Capital Assets
7,369,461
5,555,071
39,034
3,901,628
-
16,865,194
Unrestricted
(144,651)
1,768,671
277,141
231,425
3,975
2,136,561
Total Net Position
7,224,810
7,323,742
316,175
4,133,053
3,975
19,001,755
Total Liabilities and Net Position
$ 18,168,377
$ 15,288,570
$ 353,230
$ 4,149,888 $
10,648
$ 37,970,713
The Notes to the Financial Statements are an integral part of this statement. 31
CITY OF ST. JOSEPH
RECONCILIATION OF THE STATEMENT
OF NET POSITION - BUSINESS -TYPE ACTIVITIES
December 31, 2013
Total Net Position - Proprietary Funds $ 19,001,755
Amounts reported for business -type activities in the Statement of Net Position
are different because:
The Water Access Capital Project Fund is proprietary in nature and
relates to water improvements for the applicable funds. Therefore,
it is included as a business -type activity. 563
The Sewer Access Capital Project Fund is proprietary in nature and
relates to sewer improvements for the applicable funds. Therefore,
it is included as a business -type activity. 586,054
Total Net Position - Business -Type Activities $ 19,588,372
The Notes to the Financial Statements are an integral part of this statement. 32
OPERATING REVENUES
Charges for Services
Misc Operating Revenues
Total Operating Revenues
OPERATING EXPENSES
Wages and Salaries
Materials and Supplies
Repairs and Maintenance
Professional Services
Insurance
Utilities
Depreciation
Contracted Services
Equipment
Miscellaneous
Total Operating Expenses
Operating Loss
NONOPERATING REVENUES
(EXPENSES)
Investment Income
Special Assessments
Interest Expense
Amortization of Bond Premium
Bond Costs
Other Income
Total Nonoperating Revenues
(Expenses)
Loss before Capital
Contributions and Transfers
Capital Contributions
Transfers In
Transfers Out
Change in Net Position
NET POSITION
Beginning of Year
Change in Accounting Principle
Beginning of Year, Restated
End of Year
CITY OF ST. JOSEPH
STATEMENT OF REVENUES, EXPENSES AND CHANGES
IN NET POSITION - PROPRIETARY FUNDS
For the Year Ended December 31, 2013
The Notes to the Financial Statements are an integral part of this statement. 33
Sanitary
Refuse
Storm Water
Street Light
Water (601)
Sewer (602)
(603)
(651)
Utility (652)
Total
$ 713,136
$ 662,011
$ 298,123
$ 102,009
$ 43,066
$ 1,818,345
-
47,881
-
-
-
47,881
713,136
709,892
298,123
102,009
43,066
1,866,226
158,503
136,991
28,675
47,139
-
371,308
49,686
37,173
2,366
379
-
89,604
29,225
28,813
1,725
15,250
814
75,827
23,480
15,164
14,140
8,667
602
62,053
12,356
9,854
-
-
-
22,210
72,752
15,820
735
-
46,174
135,481
377,590
388,699
6,506
97,226
-
870,021
-
176,148
254,883
-
431,031
320
-
-
-
-
320
9,614
716
7,057
1,628
48
19,063
733,526
809,378
316,087
170,289
47,638
2,076,918
(20,390)
(99,486)
(17,964)
(68,280)
(4,572)
(210,692)
20,663
780
75
62
21
21,601
5,234
3,069
362
22,378
26
31,069
(361,429)
(143,925)
-
-
-
(505,354)
4,669
5,272
9,941
-
(55,213)
-
(55,213)
31,763
255
-
-
32,018
(299,100)
(189,762)
437
22,440
47
(465,938)
(319,490)
(289,248)
(17,527)
(45,840)
(4,525)
(676,630)
678
678
42,015
678
-
44,049
364,900
47,200
-
-
8,500
420,600
(45,000)
(45,000)
-
(18,250)
-
(108,250)
1,088
(286,370)
24,488
(63,412)
3,975
(320,231)
7,389,083
7,638,466
291,687
4,196,465
-
19,515,701
(165,361)
(28,354)
-
-
(193,715)
7,223,722
7,610,112
291,687
4,196,465
-
19,321,986
$ 7,224,810
$ 7,323,742
$ 316,175
$ 4,133,053
$ 3,975
$ 19,001,755
The Notes to the Financial Statements are an integral part of this statement. 33
CITY OF ST. JOSEPH
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN NET POSITION - BUSINESS -TYPE ACTIVITIES
For the Year Ended December 31, 2013
Total Net Change in Fund Net Position - Proprietary Funds $ (320,231)
Amounts reported for business -type activities in the Statement of Activities
are different because:
Recognized current year activity from the Water Access Capital Project Fund
with the business -type activities. (20,191)
Recognized current year activity from the Sewer Access Capital Project Fund
with the business -type activities. 9,155
Capital contributions to governmental activities (44,049)
Transfers in of capital assets from governmental activities 44,049
Change in Net Position - Business -Type Activities $ (331,267)
The Notes to the Financial Statements are an integral part of this statement. 34
CITY OF ST. JOSEPH
STATEMENT OF CASH FLOWS - PROPRIETARY FUNDS
For the Year Ended December 31, 2013
RECONCILIATION OF OPERATING
LOSS TO NET CASH FLOWS -
OPERATING ACTIVITIES
Operating Loss
Adjustments to Reconcile Operating Loss
to Net Cash Flows - Operating Activities:
Depreciation Expense
Other Income
Accounts Receivable
Special Assessments Receivable
Accounts Payable
Due to Other Governmental Units
Salaries Payable
Compensated Absences Payable
Net OPEB Obligation
Total Adjustments
Net Cash Flows - Operating Activities
$ (20,390)
$ (99,486)
Sanitary
Refuse
Storm Water
Street Light
377,590
388,699
Water (601)
Sewer (602)
(603)
(651)
Utility (652)
Total
CASH FLOWS - OPERATING ACTIVITIES
22,378
26
63,087
(26,649)
(21,126)
(1,033)
Receipts from Customers and Users
$ 686,487
$ 688,766
$ 297,090
$ 101,822
$ 32,463
$ 1,806,628
Payments to Suppliers
(206,197)
(283,006)
(277,585)
(26,057)
(44,965)
(837,810)
Payments to Employees
(162,946)
(142,708)
(29,530)
(41,750)
-
(376,934)
Other Miscellaneous Receipts
32,368
13
437
(27)
(269)
32,791
Net Cash Flows - Operating Activities
349,712
263,065
(9,588)
33,988
(12,502)
624,675
CASH FLOWS - NONCAPITAL FINANCING
402
6,767
370,102
362,551
8,376
ACTIVITIES
(7,930)
835,367
$ 349,712
$ 263,065
$ (9,588)
$ 33,988
Loan from Other Fund
-
-
-
4,000
4,000
Transfer from Other Funds
364,900
47,200
8,500
420,600
Transfer to Other Funds
(45,000)
(45,000)
(18,250)
(108,250)
Net Cash Flows - Noncapital Financing
319,900
2,200
(18,250)
12,500
316,350
Activities
CASH FLOWS - CAPITAL AND RELATED
FINANCING ACTIVITIES
Principal Paid on Debt
(405,000)
(352,215)
(757,215)
Interest Paid on Debt
(274,907)
(154,953)
(429,860)
Bond Proceeds
-
2,573,168
2,573,168
Acquisition of Capital Assets
(9,904)
(778,817)
(3,525)
(792,246)
Net Cash Flows - Capital and Related
(689,811)
1,287,183
(3,525)
593,847
Financing Activities
CASH FLOWS - INVESTING ACTIVITIES
Interest and Dividends Received
22,837
1,075
338
245
22
24,517
Net Change in Cash and Cash Equivalents
2,638
1,553,523
(12,775)
15,983
20
1,559,389
CASH AND CASH EQUIVALENTS
Beginning of Year
952
275,957
267,112
189,817
-
733,838
End of Year
$ 3,590
$ 1,829,480
$ 254,337
$ 205,800
$ 20
$ 2,293,227
RECONCILIATION OF OPERATING
LOSS TO NET CASH FLOWS -
OPERATING ACTIVITIES
Operating Loss
Adjustments to Reconcile Operating Loss
to Net Cash Flows - Operating Activities:
Depreciation Expense
Other Income
Accounts Receivable
Special Assessments Receivable
Accounts Payable
Due to Other Governmental Units
Salaries Payable
Compensated Absences Payable
Net OPEB Obligation
Total Adjustments
Net Cash Flows - Operating Activities
$ (20,390)
$ (99,486)
$ (17,964)
$ (68,280)
$ (4,572)
$ (210,692)
377,590
388,699
6,506
97,226
-
870,021
36,997
3,324
362
22,378
26
63,087
(26,649)
(21,126)
(1,033)
(187)
(10,603)
(59,598)
(4,629)
(3,311)
75
(22,405)
(26)
(30,296)
(7,118)
(774)
3,454
(133)
2,673
(1,898)
(1,646)
1,456
(133)
-
-
(323)
118
(553)
72
94
(269)
(7,844)
(7,844)
(1,329)
4,893
(12,124)
3,283
2,680
402
402
6,767
370,102
362,551
8,376
102,268
(7,930)
835,367
$ 349,712
$ 263,065
$ (9,588)
$ 33,988
$ (12,502)
$ 624 675
The Notes to the Financial Statements are an integral part of this statement. 35
(THIS PAGE LEFT BLANK INTENTIONALLY)
36
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
The City of St. Joseph (the "City ") is a statutory city governed by an elected mayor and four council
members. The accompanying financial statements present the government entities for which the
government is considered to be financially accountable.
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 basic 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 if it 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, certain organizations have been
defined and are presented in this report as follows:
Blended Component Unit — Reported as if they were part of the City.
Joint Ventures — The relationship of the City with the entity is disclosed.
For the categories above, the specific entities are identified as follows:
1. Blended Component Unit
The St. Joseph Economic Development Authority (EDA) 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. The St. Joseph EDA is governed by a five member board appointed by the City Council,
two members of which are City Council Members. The St. Joseph EDA is included as a blended
component unit of the City because the St. Joseph EDA is financially accountable to the City, as the
City Council approves the budget as well as any expenditure over $ 1,000. The St. Joseph EDA
provides services almost entirely for the City. The St. Joseph EDA is presented as the Economic
Development Authority Special Revenue Fund and the City Hall General Obligation (G.O.) EDA
Refunding Bonds of 2005A Debt Service Fund. Separate financial statements are not prepared for
the St. Joseph EDA.
37
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity (Continued)
2. Joint Ventures
The Central Minnesota Major Crime Investigation Unit is a group of local law enforcement officers
within the four county surrounding areas that will be available to assist any of the participating
entities in the investigation and solution of major crimes. During 2013, the City contributed $ 5,121
to the organization. It is reported as a special revenue fund of the City of Sartell. Complete financial
statements can be obtained from: City of Sartell, P.O. Box 140, Sartell, Minnesota 56377.
The City of St. Cloud Human Rights Office is a joint venture between the cities of St. Cloud and
St. Joseph, which works to enhance the lives of the citizens of the communities. During 2013, the
City contributed $ 0 to the organization. It is reported as an agency fund of the City of St. Cloud.
Complete financial statements can be obtained from: City of St. Cloud, 400 2nd Street South, St.
Cloud, Minnesota 56301.
B. Government -Wide and Fund Financial Statements
The government -wide financial statements (i.e., the Statement of Net Position and the Statement of
Activities) report information on all of the nonfiduciary activities of the City. Governmental activities,
which normally are supported by taxes and intergovernmental revenues, are reported separately from
business -type activities, which rely to a significant extent on fees and charges for support.
The Statement of Activities demonstrates the degree to which the direct expenses of a given function or
segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a
specific function or segment. Interest on general long -term debt is considered an indirect expense and
is reported separately in the Statement of Activities. Program revenues include 1) charges to customers
or applicants who purchase, use or directly benefit from goods, services or privileges provided by a
given function or segment and 2) grants and contributions that are restricted to meeting the operational
or capital requirements of a particular function or segment. Taxes and other items not properly
included among program revenues are reported instead as general revenues. Internally dedicated
revenues are reported as general revenues rather than program revenues.
Separate financial statements are provided for governmental funds and proprietary funds. Major
individual governmental funds and major individual enterprise funds are reported as separate columns in
the fund financial statements.
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government -wide financial statements are reported using the economic resources measurement focus
and the accrual basis of accounting, as are the proprietary fund financial statements. Revenues are
recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of
related cash flows. Property taxes are recognized as revenues in the year for which they are levied.
Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the
provider have been met.
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation (Continued)
Governmental fund financial statements are reported using the current financial resources measurement
focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both
measurable and available. Revenues are considered to be available when they are collectible within the
current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the
City considers revenues to be available if they are collected within 60 days of the end of the current
period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting.
However, debt service expenditures, as well as expenditures related to compensated absences and claims
and judgments, are recorded only when payment is due.
Property taxes, franchise taxes, licenses and interest associated with the current period are all
considered to be susceptible to accrual and so have been recognized as revenues of the current period.
Only the portion of special assessments receivable due within the current period is considered to be
susceptible to accrual as revenue of the current period. All other revenue items are considered to be
measurable and available only when cash is received by the City.
Description of Funds:
Major Governmental Funds:
General Fund — This Fund is the City's primary operating fund. It accounts for all financial resources
of the general City, except those required to be accounted for in another fund.
Proprietary Funds
Water Fund — This Fund accounts for the operations of the City's water utility.
Sanitary Sewer Fund — This Fund accounts for the operations of the City's sanitary sewer utility.
Refuse Fund — This Fund accounts for the operations of the City's refuse and compost utility.
Storm Water Fund — This Fund accounts for the operations of the City's storm water utility.
Street Light Utility Fund — This Fund accounts for the operations of the City's street light utility.
39
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation (Continued)
As a general rule, the effect of interfund activity has been eliminated from the government -wide
financial statements. Exceptions to this general rule are charges between the City's water, sanitary
sewer, refuse, storm water and street light utility functions and various other functions of the City.
Elimination of these charges would distort the direct costs and program revenues reported for the
various functions concerned.
Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating
revenues and expenses generally result from providing services and producing and delivering goods in
connection with a proprietary fund's principal ongoing operations. The principal operating revenues of
the Water Enterprise, Sanitary Sewer Enterprise, Refuse Enterprise, Storm Water and Street Light Utility
Enterprise Funds are charges to customers for sales and services. Operating expenses for enterprise
funds include the cost of sales and services, administrative expenses and depreciation on capital assets.
All revenues and expenses not meeting this definition are reported as nonoperating revenues and
expenses.
D. Assets, Liabilities, Deferred Inflows and Net Position or Equity
1. Cash and Investments
The City's cash and cash equivalents are considered to be cash on hand, deposits and highly liquid
debt instruments purchased with original maturities of three months or less from the date of
acquisition. Investments are stated at fair value.
Minnesota Statutes require all deposits made by cities with financial institutions are collateralized in
an amount equal to 110% of deposits in excess of Federal Deposit Insurance Corporation (FDIC)
insurance.
Minnesota Statutes authorizes the City to invest in obligations of the U.S. Treasury, agencies and
instrumentalities, shares of investment companies whose only investments are in the aforementioned
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 and in the Minnesota Municipal Investment Pool.
.l
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
D. Assets, Liabilities, Deferred Inflows and Net Position or Equity (Continued)
1. Cash and Investments (Continued)
Concentration of Credit Risk: Investments should be diversified to avoid incurring unreasonable
risks inherent in over investing in specific instruments, individual financial institutions or maturities.
The City's investment policy states the City will attempt to diversify its investments according to
type, issuer and maturity. The portfolio, as much as possible, will contain both short -term and long-
term investments. The City will attempt to match its investments with anticipated cash flow
requirements. Extended maturities may be utilized to take advantage of higher yields. No more than
20% of the total investments should extend beyond five years and the weighted average maturity of
the portfolio shall never exceed five years.
Credit Risk: Credit risk is the risk that an issuer or other counterparty to an investment will not
fulfill its obligations. Minnesota Statutes I I8A.04 and I I8A.05 limit investments that are in the top
two ratings issued by nationally recognized statistical rating organizations. The City's investment
policy limits the allowable investments in accordance with these Statutes.
Interest Rate Risk: The City should try to minimize the risk that arises from over investing in
specific instruments, individual financial institutions or maturities. The City's investment policy
states the investment portfolio will be structured so that securities mature to meet cash flow
requirements and avoiding the need to sell securities prior to maturity, investing in short -term
securities, investing in long -term securities if the market rate is favorable.
Custodial Credit Risk — Investments: For an investment, this is the risk that in the event of the
failure of the counterparty, the City will not be able to recover the value of its investments or
collateral securities that are in the possession of an outside party. The City's investment policy
addresses this risk and states the City will permit investments only to the extent that there is
Securities Investor Protection Corporation (SIPC) and excess SIPC coverage available.
2. Receivables and Payables
All trade and property tax receivables are shown at a gross amount since both are assessable to the
property taxes and are collectible upon the sale of the property.
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.
Such taxes become a lien on January 1 and are recorded as receivables by the City at that date. 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 four times a year. The tax levy
notice is mailed in March with the first half of the payment due on May 15 and the second half due
on October 15. Taxes not collected as of December 31 each year are shown as delinquent taxes
receivable.
41
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
D. Assets, Liabilities, Deferred Inflows and Net Position or Equity (Continued)
2. Receivables and Payables (Continued)
The County Auditor prepares 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
County Auditor also collects all special assessments, except for certain prepayments paid directly to
the City.
The County Auditor submits the list of taxes and special assessments to be collected on each parcel
of property to the County Treasurer in January of each year.
3. Prepaid Items
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as
prepaid items in both government -wide and fund financial statements. Prepaid items are reported
using the consumption method and recorded as expenditures at the time of consumption.
4. Capital Assets
Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads,
sidewalks and similar items), are reported in the applicable governmental or business -type activities
columns in the government -wide financial statements. Capital assets are defined by the City as
assets with an initial, individual cost of more than $ 1,000 and an estimated useful life in excess of
two years. Such assets are recorded at historical cost or estimated historical cost if purchased or
constructed. Donated capital assets are recorded at estimated fair market value at the date of
donation.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially
extend assets' lives are not capitalized.
Property, plant and equipment of the City are depreciated using the straight -line full year convention
method over the following estimated useful lives:
Assets Years
Land Improvements
5 -20
Buildings
30 -40
Building Improvements
15
Infrastructure
10 -50
Sewer Rights
20 -50
Furniture and Fixtures
5 -10
Vehicles
5 -20
Equipment
3 -7
Machinery
5 -7
42
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
D. Assets, Liabilities, Deferred Inflows and Net Position or Equity (Continued)
5. Deferred Inflows of Resources
In addition to liabilities, the statement of financial position and fund financial statements will
sometimes report a separate section for deferred inflows of resources. This separate financial
statement element represents an acquisition of net position that applies to a future period(s) and so
will not be recognized as an inflow of resources (revenue) until that time. The City only has one
type of item, which arises only under the modified accrual basis of accounting that qualifies for
reporting in this category. Accordingly, the item is reported only in the governmental funds balance
sheet as unavailable revenue. The governmental funds report unavailable revenues from three
sources: property taxes, special assessments and notes receivable. These amounts are deferred and
recognized as an inflow of resources in the period that the amounts become available.
6. Compensated Absences
The City compensates employees who leave City service in good standing for all earned, unused
vacation. Employees can accrue up to 200 hours of vacation depending on years of service. The
maximum amount of carryover from year -to -year is 100 hours or the amount of the current vacation
accrual rate. In addition, employees are compensated for unused sick leave (up to a maximum of
720 hours or 960 hours for LELS and AFSCME employees) at various rates depending on the
employee type and years of service, provided the City's notice of termination policy has been
complied with.
7. Long -Term Obligations
In the government -wide financial statements, and proprietary fund types in the fund financial
statements, long -term debt and other long -term obligations are reported as liabilities in the applicable
governmental activities, business -type activities or proprietary fund type Statement of Net Position.
Bond premiums and discounts are deferred and amortized over the life of the bonds using the
effective interest method.
In the fund financial statements, governmental fund types recognize bond premiums and discounts,
as well as bond issuance costs, during the current period. The face amount of debt issued is reported
as other financing sources. Premiums received on debt issuances are reported as other financing
sources while discounts on debt issuances are reported as other financing uses. Issuance costs,
whether or not withheld from the actual debt proceeds received, are reported as debt service
expenditures.
8. Fund Equity
a) Classification
In the fund financial statements, governmental funds report fund classifications that comprise a
hierarchy based primarily on the extent to which the City is bond to honor constraints on the
specific purpose for which amounts in those funds can be spent.
43
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
D. Assets, Liabilities, Deferred Inflows and Net Position or Equity (Continued)
8. Fund Equity (Continued)
a) Classification (Continued)
• Nonspendable Fund Balance — These are amounts that cannot be spent because they are
not in spendable form as they are legally or contractually required to be maintained intact
and include amounts set aside for prepaid items.
• Restricted Fund Balance — These are amounts that are restricted to specific purposes
either by a) constraints placed on the use of resources by creditors, grantors, contributors,
or laws or regulations of other governments or b) imposed by law through enabling
legislation.
• Committed Fund Balance — These are amounts that can only be used for specific purposes
pursuant to constraints imposed by the City Council (highest level of decision making
authority) through resolution.
• Assigned Fund Balance — These are amounts that are constrained by the City's intent to
be used for specific purposes but are neither restricted nor committed. Assignments are
made by the City's Finance Director based on the City Council's direction.
• Unassigned Fund Balance — These are residual amounts in the General Fund not reported
in any other classification. The General Fund is the only fund that can report a positive
unassigned fund balance. Other funds would report a negative unassigned fund balance
should the total of nonspendable, restricted, committed and assigned fund balances
exceed the total net resources of that fund.
When both restricted and unrestricted resources are available for use, it is the City's policy to
first use restricted resources, and then use unrestricted resources as they are needed. When
committed, assigned and unassigned resources are available for use, it is the City's policy to use
resources in the following order: committed, assigned and unassigned.
b) Minimum Fund Balance
The City's target General Fund balance is to maintain working capital, a portion of the
unassigned balance, in the amount of four to six months of the next year's budgeted expenditures
of the General Fund, excluding the fire department.
,
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
D. Assets, Liabilities, Deferred Inflows and Net Position or Equity (Continued)
9. Net Position
Net position represents the difference between assets and liabilities and deferred inflows in the
government -wide financial statements. Net investment in capital assets consists of capital assets, net
of accumulated depreciation, reduced by the outstanding balance of any long -term debt used to build
or acquire the capital assets. A reclassification of $ 2,286,228 between the net position and
unrestricted net position on the total column in the Statement of Net Position to recognize the portion
of debt attributable to capital assets donated from governmental activities to business -type activities.
Net position is reported as restricted in the government -wide financial statement when there are
limitations on their use through external restrictions imposed by creditors, grantors or laws or
regulations of other governments. The restricted for other purposes restriction of net position for
governmental activities of $ 1,383,229 includes $ 14,120 for tax incrementing financing, $ 1,272,767
in state collected sales tax restricted by enabling legislation, $ 54,661 in park dedication fees, $ 3,949
restricted by donors for future projects, $ 30,862 in revolving loan funds restricted for EDA projects
and $ 6,870 of restricted PEG access fees.
10. Use of Estimates
The preparation of the financial statements in conformity with accounting principles generally
accepted in the United States of America 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.
NOTE 2 — STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
A. Budgetary Information
1. In August of each year, City staff submits to the City Council, a proposed operating budget for
the year commencing the following January 1. The operating budget includes proposed
expenditures and the means of financing them for the upcoming year.
2. Public hearings are conducted to obtain taxpayer comments.
3. The budget is legally enacted through passage of a resolution after obtaining taxpayer comments.
4. Budgets for the General Fund and the Economic Development Authority Special Revenue Fund
are adopted on a basis consistent with accounting principles generally accepted in the United
States of America.
45
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 2 — STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
A. Budgetary Information (Continued)
5. Expenditures may not legally exceed budgeted appropriations at the department level. No fund's
budget can be increased without City Council approval. The City Council may authorize transfer
of budgeted amounts between departments within any fund. Management may amend budgets
within a department level, so long as the total department budget is not changed.
6. Annual appropriated budgets are adopted during the year for the General Fund and the Economic
Development Authority Special Revenue Fund. Annual appropriated budgets are not adopted for
Debt Service Funds because effective budgetary control is alternatively achieved through bond
indenture provisions. Budgetary control for Capital Projects Funds is accomplished through the
use of project controls and formal appropriated budgets are not adopted.
7. Budgeted amounts are as originally adopted by the City Council. Budgeted expenditure
appropriations lapse at year -end.
Encumbrances outstanding at year -end expire and outstanding purchase orders are canceled and not
reported in the financial statements.
B. Deficit Fund Balance
The following Fund had a deficit fund balance at December 31, 2013.
Nonmajor Governmental Funds:
Special Revenue:
TIF 2 -2 St. Joseph Meat Market $ 466
This deficit will be eliminated with future tax increment revenues.
C. Disbursements in Excess of Appropriations
Disbursements exceeded appropriations in the following Fund for the year ended December 31, 2013.
General Fund
Disbursements
Appropriations
$ 2,603,383 $ 2,527,240
M
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 3 — DEPOSITS AND INVESTMENTS
A. Deposits
Cash balances of the City's funds are combined (pooled) and invested to the extent available in various
investments authorized by Minnesota Statutes. Each fund's portion of this pool (or pools) is displayed
in the financial statements as "cash and cash equivalents" or "investments." For purposes of identifying
risk of investing public funds, the balances and related restrictions are summarized as follows.
Custodial Credit Risk — Deposits: As of December 31, 2013, the City's bank balance was not exposed to
custodial credit risk because it was fully insured through the FDIC or NCUA and fully collateralized
with securities held by the pledging financial institutions trust department or agent and in the City's
name. As of December 31, 2013, the City's deposits had a carrying value as shown below.
Certificates of Deposit $ 1,458,423
Checking 1,033,222
Savings 3,449,690
Total $ 5,941,335
B. Investments
As of December 31, 2013, the City had the following investments:
Fair
Value
Brokered Certificates of Deposit $ 1,989,154
Brokered Money Market 28,806
State and Local Government Securities 4,682,985
Government Bonds/ Notes 937,610
Total $ 7,638,555
Weighted
Average Moody's
Maturity (Years) Rating
2.37
N/A
N/A
N/A
0.92
N/A
8.55
AAA
Credit Risk: As of December 31, 2013, the City's investments were rated as listed in the table above.
Concentration of Credit Risk: As of December 312013, the City's investment in state and local
government securities (61.3 %) and the investment in a Federal Home Loan Bank security (9.7 %)
exceeded 5% of the City's total investment portfolio. Money market accounts are not subject to
concentration of credit risk.
47
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 3 — DEPOSITS AND INVESTMENTS
C. Deposits and Investments
The following is a summary of deposits and investments as of December 31, 2013:
Deposits (Note 3.A.)
Investments (Note 3.13.)
Petty Cash
Total
$ 5,941,335
7,638,555
275
$ 13,580,165
Deposits and investments are presented in the December 31, 2013 basic financial statements as follows:
Statement of Net Position:
Cash and Investments $ 8,897,180
Cash with Fiscal Agents 4,682,985
Total Deposits and Investments $ 13,580,165
NOTE 4 — INTERFUND BALANCES AND TRANSFERS
A. Interfund Balances
The composition of interfund balances as of December 31, 2013 is as follows:
Receivable Fund
General Fund
Other Governmental Funds
Payable Fund
Street Light Utility Fund
Other Governmental Funds
Amount
$ 4,000
500
$ 4,500
The due from /due to other funds balances represent loan made to cash flow a new fund and to cover tax
increment financing (TIF) consulting costs to establish the TIF district.
.•
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 4 — INTERFUND BALANCES AND TRANSFERS
B. Transfers
The composition of interfund transfers as of December 31, 2013 is as follows:
Transfer In Transfer Out Description
Transfer unspent capital reserve
General Fund Other Governmental Funds for closed project
General Fund Other Governmental Funds Close fund
Water Other Governmental Funds Annual transfer for bond payment
Sanitary Sewer Other Governmental Funds Annual transfer for bond payment
Other Governmental Funds
Other Governmental Funds
Street Light Utility
Other Governmental Funds
Other Governmental Funds
Other Governmental Funds
Other Governmental Funds
Other Governmental Funds
General Fund
General Fund
Other Governmental Funds
Water
Sanitary Sewer
Storm Water
Close fund
Transfer unspent capital budget
Transfer four months of operations
from general fund levy
Annual transfer for bond payment
Annual transfer for bond payment
Annual transfer for bond payment
Annual transfer for bond payment
$ 20,000
416
364,900
47,200
386,233
25,660
8,500
3,050
45,000
45,000
$ 964,209
.•
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 5 - CAPITAL ASSETS
Capital asset activity for the year ended December 31, 2013 was as follows:
Governmental Activities:
Capital Assets not being Depreciated:
Land
Easements
Construction in Progress
Total Capital Assets
not being Depreciated
Capital Assets being Depreciated:
Buildings
Infrastructure
Improvements
Machinery and Equipment
Total Capital Assets
being Depreciated
Less Accumulated Depreciation for:
Buildings
Infrastructure
Improvements
Machinery and Equipment
Total Accumulated
Depreciation
Total Capital Assets being
Depreciated, Net
Beginning
Ending
Balance
Increases
Decreases
Balance
$ 457,194
$ -
$ -
$ 457,194
5,820
-
-
5,820
465,568
691,919
218,918
938,569
928,582
691,919
218,918
1,401,583
2,479,464
31,799
-
2,511,263
16,209,266
101,705
168,969
16,142,002
637,001
104,871
-
741,872
3,024,213
377,385
146,635 *
3,254,963
22,349,944
615,760
315,604
22,650,100
902,309
63,473
-
965,782
9,967,212
856,600
168,969
10,654,843
376,228
31,604
-
407,832
1,860,856
218,598
89,084
1,990,370
13,106,605
1,170,275
258,053
14,018,827
9,243,339
(554,515)
57,551
8,631,273
Governmental Activities Capital
Assets, Net $ 10,171,921 $ 137,404 $ 276,469 $ 10,032,856
* A portion of the decrease in machinery and equipment was transferred to the business type activities.
50
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 5 - CAPITAL ASSETS
Beginning Ending
Business -Type Activities:
Capital Assets not being Depreciated:
Land
$ 377,882
$ -
$ -
$ 377,882
Easements
67,915
-
-
67,915
Construction in Progress
4,789,651
769,254
5,474,675
84,230
Total Capital Assets
not being Depreciated
5,235,448
769,254
5,474,675
530,027
Capital Assets being Depreciated:
Buildings
8,120,415
-
-
8,120,415
Plant and Lines
21,195,993
-
-
21,195,993
Machinery and Equipment
605,590
67,043
1,795
670,838
Sewer Rights
3,057,013
5,474,674
-
8,531,687
Total Capital Assets
being Depreciated
32,979,011
5,541,717
1,795
38,518,933
Less Accumulated Depreciation for:
Buildings
1,685,175
184,260
-
1,869,435
Plant and Lines
4,671,069
424,309
-
5,095,378
Machinery and Equipment
397,637
34,485
1,795
430,327
Sewer Rights
810,413
226,967
-
1,037,380
Total Accumulated
Depreciation
7,564,294
870,021
1,795
8,432,520
Total Capital Assets being
Depreciated, Net
25,414,717
4,671,696
-
30,086,413
Business -Type Activities Captial
Assets, Net
$ 30,650,165
$ 5,440,950
$ 5,474,675
$ 30,616,440
Depreciation expense was charged to
functions /programs of the City as follows:
Governmental Activities:
General Government
$ 41,172
Public Safety
125,543
Public Works
919,104
Culture and Recreation
84,456
Total Depreciation Expense - Governmental Activities
$ 1,170,275
Business -Type Activities
Water $ 377,590
Sanitary Sewer 388,699
Refuse 6,506
Storm Sewer 97,226
Total Depreciation Expense - Business -Type Activities $ 870,021
51
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 6 - LONG -TERM DEBT
A. G.O. Bonds
The City issues G.O. bonds to provide for financing improvement, development and street improvement
projects. Debt service is covered respectively by contract revenue, special assessments against benefited
properties, federal grants and lease revenue with any shortfalls being paid from general taxes.
G.O. bonds are direct obligations and pledge the full faith and credit of the City. These bonds generally
are issued as 5 to 15 year serial bonds with equal debt service payments each year.
Revenue bonds are issued by the City where the City pledges income derived from the acquired or
constructed assets to pay debt service including access and trunk charges and utility user fees.
B. Components of Long -Term Liabilities
Governmental Activities:
G.O. Bonds, Including Refunding Bonds:
G.O. Capital Improvement Plan
Refunding Bonds 2009B
G.O. Certificates of Indebtedness
of 2010A
G.O. Refunding Bonds of 2011A
G.O. Certificates of Indebtedness
of 20l lA
G.O. Capital Improvement Plan
Bonds of2011A
G.O. Bonds of20l3A
Total G.O. Bonds
G.O. Special Assessment Bonds:
G.O. Improvement Bonds of 2007A
G.O. Improvement Refunding
Bonds of 2007B
G.O. Improvement Crossover Refunding
Bonds of 2009A
G.O. Improvement Refunding Bonds of 2010B
G.O. Improvement Refunding Bonds of 2010B
G.O. Improvement Crossover
Refunding Bonds of 2011A
G.O. Bonds of20l3A
Total G.O. Special
Assessment Bonds
Public Project Revenue Bonds:
FDA Revenue Refunding Bonds of 2005A
Unamortized Premiums/Discounts
Compensated Absences
Total Long -Term Liabilities,
Governmental Activities
Issue
Interest
Original
Final
Principal
Due Within
Date
Rate
Issue
Maturity
Outstanding
One Year
09/03/09
1.10 % -3.75%
$ 495,000
12/01/18
$ 285,000
$ 55,000
04/22/10
2.75%
150,000
12/01/15
60,000
30,000
11 /10 /11
2.00%
430,000
10/01/17
290,000
70,000
11 /10 /11
2.00 % -2.40%
390,000
10/01/21
320,000
35,000
11 /10 /11
2.00 % -2.40%
195,000
10/01/21
160,000
20,000
09/01/13
2.00%
265,000
12/01/18
265,000
50,000
1,380,000
260,000
07/25/07
4.00 % -4.13%
2,875,000
12/01/17
280,000
65,000
11/14/07
3.60 % -3.90%
980,000
12/01/14
115,000
115,000
03/19/09
1.25 % -2.90%
2,555,000
12/01/17
1,335,000
315,000
09/28/10
2.00 % -3.25%
1,035,000
12/01/20
910,000
120,000
09/28/10
2.00 % -3.25%
790,000
12/01/25
655,000
50,000
11 /10 /11
2.00 % -2.40%
1,040,000
10/01/21
1,040,000
120,000
09/01/13
2.00 % -3.00%
405,000
12/01/24
405,000
-
4,740,000
785,000
03/15/05
2.75 % -4.15%
645,000
12/01/15
180,000
90,000
47,342
-
395,218
19,067
$ 6,742,560
$ 1,154,067
52
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 6 — LONG -TERM DEBT
B. Components of Long -Term Liabilities (Continued)
Long -term bonded indebtedness listed on the previous page and above were issued to finance acquisition
and construction of capital assets or to refinance (refund) previous bond issues.
The City issued $ 1,040,000 of the G.O. Improvement Bonds 2011A for a crossover refunding of the
G.O. Improvement Bonds 2006C. The issue was called on December 1, 2013. The refunding was
undertaken to reduce total future debt service payments. The refunding resulted in a net present value
benefit of $ 77,442. The economic gain from the transaction was $ 140,270.
The City issued $ 4,860,000 of the G.O. Improvement Bonds 2012A for a crossover refunding of the
G.O. Improvement Bonds 2005D. The issue will be called on December 1, 2014. The refunding was
undertaken to reduce total future debt service payments. The refunding resulted in a net present value
benefit of $ 298,853. The economic gain from the transaction was $ 366,766.
53
Issue
Interest
Original
Final
Principal
Due Within
Date
Rate
Issue
Maturity
Outstanding
One Year
Business -Type Activities:
G.O. Revenue Bonds:
G.O. Water Revenue Bonds of 2005D
12/15/05
4.00 % -4.25%
$ 4,595,000
12/01/14
$ 4,595,000
$ 4,595,000
G.O. Water Revenue Bondsof2006A
01/12/06
3.50 % -4.00%
3,575,000
12/01/16
1,125,000
360,000
G.O. Sewer Revenue Crossover Refunding
Bonds of2009A
03/19/09
1.25 % -3.85%
455,000
12/01/21
315,000
35,000
G.O. Water Revenue Refunding
Bonds of2009C
10/20/09
1.00 % -2.60%
425,000
12/01/16
195,000
60,000
G.O. Sewer Revenue Bonds of 2011A
11 /10 /11
2.00 -2.40%
225,000
10/01/21
185,000
20,000
G.O. Water Revenue Crossover Refunding
Bonds of20l2A
04/19/12
1.00 -2.85%
4,860,000
12/01/28
4,860,000
-
G.O. Sewer Revenue Bonds of 20l3A
09/01/13
2.00 -3.70%
1,875,000
12/01/28
1,875,000
110,000
Total G.O. Revenue Bonds
13,150,000
5,180,000
Notes Payable:
City of St. Cloud SIS
Phases 1 and 2 (2009B Bonds)
10/26/09
2.00 % -4.0%
835,000
08/01/19
530,000
80,000
City of St. Cloud SIS
Phase 3 (2010 Bonds)
10/28/10
2.00 % -2.5%
180,000
08/01/20
130,000
15,000
City of St. Cloud SIS
Phase 4 (2013B Bonds)
11/01/13
3.00 % -4.00%
650,000
02/01/29
650,000
-
City of St. Cloud PFA Loan
08/01/10
1.77%
4,527,703
08/20/30
4,055,030
206,494
Total Notes Payable
5,365,030
301,494
Unamortized Premium
96,216
-
Compensated Absences
108,532
2,556
Total Business -Type Activities
18,719,778
5,484,050
Total all Long -Term Liabilities
$ 25,462,338
$ 6,638,117
Long -term bonded indebtedness listed on the previous page and above were issued to finance acquisition
and construction of capital assets or to refinance (refund) previous bond issues.
The City issued $ 1,040,000 of the G.O. Improvement Bonds 2011A for a crossover refunding of the
G.O. Improvement Bonds 2006C. The issue was called on December 1, 2013. The refunding was
undertaken to reduce total future debt service payments. The refunding resulted in a net present value
benefit of $ 77,442. The economic gain from the transaction was $ 140,270.
The City issued $ 4,860,000 of the G.O. Improvement Bonds 2012A for a crossover refunding of the
G.O. Improvement Bonds 2005D. The issue will be called on December 1, 2014. The refunding was
undertaken to reduce total future debt service payments. The refunding resulted in a net present value
benefit of $ 298,853. The economic gain from the transaction was $ 366,766.
53
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 6 — LONG -TERM DEBT
C. Changes in Long -Term Liabilities
Long -term liability activity for the year ended December 31, 2013 was as follows:
Governmental Activities:
Bonds Payable:
General Obligation
G.O. Special Assessment Bonds
Public Project Revenue Bonds
Total Bonds Payable
Unamortized Premiums/Discounts
Compensated Absences
Total Governmental
Activities
Business -Type Activities:
Bonds Payable:
G.O. Utility Revenue Bonds
Notes Payable:
City of St. Cloud Notes
Unamortized Premiums
Compensated Absences
Total Business -Type
Activities
Beginning
1,875,000
460,000
Ending
Balance
Additions
Reductions
Balance
90,782
15,375
9,941
96,216
$ 1,385,000
$ 265,000
$ 270,000
$ 1,380,000
6,630,000
405,000
2,295,000
4,740,000
260,000
-
80,000
180,000
8,275,000
670,000
2,645,000
6,300,000
51,395
11,122
15,175
47,342
366,195
182,189
153,166
395,218
8,692,590
863,311
2,813,341
6,742,560
11,735,000
1,875,000
460,000
13,150,000
4,964,077
698,168
297,215
5,365,030
90,782
15,375
9,941
96,216
120,656
26,242
38,366
108,532
16,910,515
2,614,785
805,522
18,719,778
Total Long -Term Liabilities $ 25,603,105 $ 3,478,096 $ 3,618,863 $ 25,462,338
The General Fund typically liquidates the liability related to compensate absences.
54
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 6 - LONG -TERM DEBT
D. Minimum Debt Payments
Minimum annual principal and interest payments required to retire long -term liabilities
Total $ 1,380,000 $ 110,670 $ 4,740,000 $ 516,014
Governmental Activities
Year Ended
December 31,
2014
2015
2016
2017
2018
2019 -2023
2024 -2025
Public Project Revenue Bonds
Principal Interest
$ 90,000 $ 7,335
90,000
3,735
Total
$ 1,300,914
1,210,261
1,091,270
1,095,926
580,033
1,476,675
182,675
Total $ 180,000 $ 11,070 $ 6,937,754
55
Governmental Activities
Year Ended
G.O. Government Activities
G.O. Special Assessment Bonds
December 31,
Principal
Interest
Principal
Interest
2014
$ 260,000
$ 33,205
$ 785,000
$ 125,374
2015
265,000
25,905
725,000
100,621
2016
240,000
19,830
750,000
81,440
2017
250,000
14,480
770,000
61,446
2018
180,000
8,730
350,000
41,303
2019 -2023
185,000
8,520
1,185,000
98,155
2024 -2025
-
-
175,000
7,675
Total $ 1,380,000 $ 110,670 $ 4,740,000 $ 516,014
Governmental Activities
Year Ended
December 31,
2014
2015
2016
2017
2018
2019 -2023
2024 -2025
Public Project Revenue Bonds
Principal Interest
$ 90,000 $ 7,335
90,000
3,735
Total
$ 1,300,914
1,210,261
1,091,270
1,095,926
580,033
1,476,675
182,675
Total $ 180,000 $ 11,070 $ 6,937,754
55
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 6 — LONG -TERM DEBT
D. Minimum Debt Payments (Continued)
E. Conduit Debt
Conduit debt obligations are certain limited obligation revenue bonds or similar debt instruments issued
for the express purpose of providing capital financing for a specific third party. The City has issued
various revenue bonds to provide funding to private sector entities for projects deemed to be in the
public interest. Although these bonds bear the name of the City, the City has no obligation for such debt.
Accordingly, the bonds are not reported as liabilities in the financial statements of the City.
As of December 31, 2013, the City's conduit debt consisted of the following:
Commercial Development Revenue Note
(Independence Center), Series 2001
Industrial Revenue Bonds (St. Joseph
Development, LLC), Series 2002
Total
$ 330,997
700,000
$ 1,030,997
56
Business -Type Activities
Year Ended
Utility Revenue Bonds
Notes Payable
December 31,
Principal
Interest
Principal
Interest
Total
2014
$ 5,180,000
$ 424,629
$ 301,494 $
110,618
$ 6,016,741
2015
660,000
203,370
340,220
109,358
1,312,948
2016
680,000
182,545
358,946
101,485
1,322,976
2017
635,000
160,925
362,671
93,196
1,251,792
2018
650,000
147,865
366,510
84,841
1,249,216
2019 -2023
3,255,000
526,465
1,513,063
301,343
5,595,871
2024 -2028
2,090,000
155,102
1,524,980
148,413
3,918,495
2029 -2030
-
-
597,146
15,475
612,621
Total
$ 13,150,000
$ 1,800,901
$ 5,365,030 $
964,729
$ 21,280,660
E. Conduit Debt
Conduit debt obligations are certain limited obligation revenue bonds or similar debt instruments issued
for the express purpose of providing capital financing for a specific third party. The City has issued
various revenue bonds to provide funding to private sector entities for projects deemed to be in the
public interest. Although these bonds bear the name of the City, the City has no obligation for such debt.
Accordingly, the bonds are not reported as liabilities in the financial statements of the City.
As of December 31, 2013, the City's conduit debt consisted of the following:
Commercial Development Revenue Note
(Independence Center), Series 2001
Industrial Revenue Bonds (St. Joseph
Development, LLC), Series 2002
Total
$ 330,997
700,000
$ 1,030,997
56
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 7 — FUND BALANCE
Fund equity balances are classified as follows to reflect the limitations and restrictions of the respective
funds.
Nonspendable:
Prepaid Expenses
Restricted:
PEG Access Fees
Debt Service
Tax Increments
State Collected Sales Tax Projects
Park Dedication Fees
Chartitable Gambling
Revolving Loan
Total Restricted
Committed:
Economic Development
Assigned:
Elections
Street Seal Coating /Crack Filling
Loader Tires
Fire Operations
Fire Debt Service
Fire Capital
Capital Outlay Reserves
Debt Service Relief
Total Assigned
Unassigned
Total
Nonmajor
Governmental
General Fund Total
$ 19,500 $ -
$ 19,500
6,870 -
6,870
- 1,804,254
1,804,254
- 14,120
14,120
- 1,272,767
1,272,767
- 54,661
54,661
- 3,949
3,949
- 30,862
30,862
6,870 3,180,613
3,187,483
112,486 112,486
27,265
-
27,265
29,335
-
29,335
13,000
-
13,000
20,000
-
20,000
180,000
-
180,000
291,170
-
291,170
-
1,097,882
1,097,882
-
262,084
262,084
560,770
1,359,966
1,920,736
1,134,091
(466)
1,133,625
$ 1,721,231 $ 4,652,599 $ 6,373,830
57
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 8 — RISK MANAGEMENT
The City purchases commercial insurance coverage through the League of Minnesota Cities Insurance
Trust ( LMCIT) with other cities in the state, which is a public entity risk pool currently operating as a
common risk management and insurance program. The City pays an annual premium to the LMCIT for
its insurance coverage. The LMCIT 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 amount of these deductibles is considered immaterial to
the financial statements.
There were no significant reductions in insurance from the previous year or settlements in excess of
insurance coverage for any of the past three years.
The City's workers' compensation insurance policy is retrospectively rated. With this type of policy,
final premiums are determined after loss experience is known. The amount of premium adjustment for
2013 is estimated to be immaterial based on workers' compensation rates and salaries for the year.
At December 31, 2013, there were no other claims liabilities reported in the fund based on the
requirements of GASB Statement No. 10, which requires a liability for claims be reported if information
prior to the issuance of the financial statements indicates it is probable a liability has been incurred at the
date of the financial statements and the amount of the loss can be reasonably estimated.
NOTE 9 — DEFINED BENEFIT PENSION PLANS — STATE -WIDE
Public Employees' Retirement Association
A. Plan Description
All full -time and certain part -time employees of the City are covered by defined benefit plans
administered by the Public Employees' Retirement Association of Minnesota (PERA). PERA
administers the General Employees' Retirement Fund (GERF) 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.
GERF members belong to either the Coordinated or Basic Plan. Coordinated Plan members are covered
by Social Security and Basic Plan members are not. All new members must participate in the
Coordinated Plan. All police officers, firefighters and peace officers who qualify for membership by
statute are covered by the PEPFF.
PERA provides retirement benefits as well as disability benefits to members, and benefits to survivors
upon death of eligible members. Benefits are established by state statute and vest after five 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.
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 9 — DEFINED BENEFIT PENSION PLANS — STATE -WIDE
Public Employees' Retirement Association (Continued)
A. Plan Description (Continued)
Two methods are used to compute benefits for PERA's Coordinated and Basic Plan members. The
retiring member receives the higher of a step -rate benefit accrual formula (Method 1) or a level accrual
formula (Method 2). Under Method 1, the annuity accrual rate for a Basic Plan member is 2.2% of
average salary for each of the first 10 years of service and 2.7% for each remaining year. The annuity
accrual rate for a Coordinated Plan member is 1.2% of average salary for each of the first 10 years and
1.7% for each remaining year. Under Method 2, the annuity accrual rate is 2.7% of average salary for
Basic Plan members and 1.7% for Coordinated Plan members for each year of service. For PEPFF
members, the annuity accrual rate is 3.0% for each year of service. For all GERF and PEPFF members
hired prior to July 1, 1989, whose annuity is calculated using Method 1, a full annuity is available when
age plus years of service equal 90. Normal retirement age is 55 for PEPFF members and 65 for Basic
and Coordinated Plan members hired prior to July 1, 1989. Normal retirement age is the age for
unreduced Social Security benefits capped at 66 for Coordinated Plan members hired on or after July 1,
1989. A reduced retirement annuity is also available to eligible members seeking early retirement.
There are different types of annuities available to members upon retirement. A single -life annuity is a
lifetime annuity that ceases upon the death of the retiree — no survivor annuity is payable. There are also
various types of joint and survivor annuity options available which will be payable over joint lives.
Members may also leave their contributions in the Fund upon termination of public service in order to
qualify for a deferred annuity at retirement age. Refunds of contributions are available at any time to
members who leave public service, but before retirement benefits begin.
The benefit provisions stated in the previous paragraphs of this section are current provisions and apply
to active Plan participants. Vested, terminated employees who are entitled to benefits but are not yet
receiving them 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 GERF and PEPFF. That report may be obtained on the Internet at
www.mnpera.org, by writing to PERA at 60 Empire Drive, 9200, St. Paul, Minnesota 55103 -2088 or by
calling (651) 296 -7460 or (800) 652 -9026.
59
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 9 — DEFINED BENEFIT PENSION PLANS — STATE -WIDE
Public Employees' Retirement Association (Continued)
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. GERF Basic Plan members and
Coordinated Plan members were required to contribute 9.1% and 6.25 %, respectively, of their annual
covered salary in 2013. PEPFF members were required to contribute 9.6% of their annual covered salary
in 2013. In 2013, the City was required to contribute the following percentages of annual covered
payroll: 11.78% for Basic Plan members, 7.25% for Coordinated Plan members and 14.4% for PEPFF
members. The City's contributions to the Public Employees' Retirement Fund for the years ending
December 31, 2013, 2012 and 2011 were $ 53,773, $ 51,941 and $ 52,013, respectively. The City's
contributions to the PEPFF for the years ending December 31, 2013, 2012 and 2011 were $ 72,518,
$ 66,427 and $ 63,930, respectively. The City's contributions were equal to the contractually required
contributions for each year as set by state statute.
Defined Contribution Plan
The City provides pension benefits for its elected local government officials through a defined
contribution plan administered by the PERA. The Public Employees' Defined Contribution Plan
(PEDCP) is a multi - employer tax qualified plan under Section 401(a) of the Internal Revenue Code and
all contributions by or on behalf of employees are tax deferred until time of withdrawal.
Plan benefits depend solely on amounts contributed to the plan plus investment earnings, less
administrative expenses. Minnesota Statutes Chapter 353D.03, specifies plan provisions, including the
employee and employer contribution rates for those qualified personnel who elect to participate. An
eligible elected official who decides to participate contributes 5% of salary which is matched by the
elected official's employer. For ambulance service personnel, employer contributions are determined by
the employer and for salaried employees must be a fixed percentage of salary. Employer contributions
for volunteer personnel may be a unit value for each call or period of alert duty. Employees who are
paid for their services may elect to make member contributions in an amount not to exceed the employer
share. Employer and employee contributions are combined and used to purchase shares in one or more
of the seven accounts of the Minnesota Supplemental Investment Fund. For administering the plan,
PERA receives 2% of employer contributions and twenty -five hundredths of 1% of the assets in each
member's account annually.
There is no vesting period required to receive benefits in the PEDCP. Both the City and the elected local
government officials made the required 5% contribution, amounting to $ 1,632 from each source, or
$ 3,265 in total. As of December 31, 2013 and for the year then ended, PERA held no securities issued
by the City or other related parties.
•1
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 10 — POST EMPLOYMENT HEALTH CARE PLAN
A. Plan Description
The City provides a single - employer defined benefit health care plan to eligible retirees. The plan offers
medical coverage. Medical coverage is administered by B1ueCross B1ueShield. It is the City's policy to
periodically review its medical coverage, and to obtain requests for proposals in order to provide the
most favorable benefits and premiums for City employees and retirees.
B. Funding Policy
Retirees contribute to the health care plan at the same rate as City employees. This results in the retirees
receiving an implicit rate subsidy. Contribution requirements are established by the City, based on the
contract terms with B1ueCross BlueShield. The required contributions are based on projected pay -as-
you-go financing requirements. For 2013, the City contributed $ 4,487 to the plan. As of December 31,
2013, there was one retiree receiving health benefits from the City's health plan.
C. Annual OPEB Cost and Net OPEB Obligation
The City's annual OPEB cost (expense) is calculated based on the annual required contribution (ARC)
of the City, an amount actuarially determined in accordance with the parameters of GASB Statement
No. 45. The City prospectively implemented this Statement during the 2009 year. The ARC represents
a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and
amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed 30 years. The
table on the following page shows the components of the City's annual OPEB cost of the year, the
amount actually contributed to the plan, and changes in the City's net OPEB obligation to the plan.
ARC
Interest on Net OPEB Obligation
Adjustment to ARC
Annual OPEB Cost
Contributions Made
Increase in Net OPEB
Net OPEB Obligation
Net OPEB Obligation
$ 37,124
7,084
(10,242)
33,966
4,487
Obligation 29,479
- Beginning of Year 1775108
- End of Year $ 206,587
61
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 10 — POST EMPLOYMENT HEALTH CARE PLAN
C. Annual OPEB Cost and Net OPEB Obligation (Continued)
The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan and the net
OPEB obligation for 2013, 2012 and 2011 was as follows:
Annual OPEB
Year Ended Cost
12/31/11 $ 55,435
12/31/12 32,788
12/31/13 33,966
Percentage of
Employer Annual OPEB Cost Net OPEB
Contribution Contributed Obigation
$ 6,889 12% $ 145,185
865 3% 177,108
4,487 13% 206,587
D. Funded Status and Funding Progress
As of January 1, 2012, the most recent actuarial valuation date, the City had no assets deposited to fund
the plan. The actuarial accrued liability for benefits was $ 239,852 and the actuarial value of assets was
$ 0, resulting in an unfunded actuarial accrued liability (UAAL) of $ 239,852. The covered payroll
(annual payroll of active employees covered by the plan) was $ 1,386,050, and the ratio of the UAAL to
the covered payroll was 17.3 %.
Actuarial valuations involve estimates of the value of reported amounts and assumptions about the
probability of occurrence of events far into the future. Examples include assumptions about future
employment, mortality and the health care cost trend. Amounts determined regarding the funded status
of the plan and the ARC of the employer are subject to continual revision as actual results are compared
with past expectations and new estimates are made about the future.
The Schedule of Funding Progress — Other Post Employment Benefits, presented as required
supplementary information following the Notes to the Financial Statements, presents multi -year trend
information about whether the actuarial value of plan assets is increasing or decreasing over time relative
to the actuarial accrued liabilities for benefits.
E. Actuarial Methods and Assumptions
Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as
understood by the employer and the plan members) and include the types of benefits provided at the time
of each valuation and the historical pattern of sharing of benefit costs between the employer and plan
members to that point. The actuarial methods and assumptions used include techniques that are
designed to reduce the effects of short -term volatility in actuarial accrued liabilities, consistent with the
long -term perspective of the calculations.
62
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 10 — POST EMPLOYMENT HEALTH CARE PLAN
E. Actuarial Methods and Assumptions (Continued)
At the January 1, 2012 actuarial valuation date, the projected unit credit with 30 year amortization of the
unfunded liability method was used. The actuarial assumptions included a 4.0% discount rate. The City
currently does not plan to prefund for this benefit. At the actuarial valuation date, the annual health care
cost trend rate was calculated to be 10% initially, reduced incrementally to an ultimate rate of 5% after
10 years. The UAAL is being amortized as a level percentage of projected payroll on an open basis.
The remaining amortization period at December 31, 2013 was 25 years.
NOTE 11— COMMITMENTS
The City has entered into contracts for construction as follows:
Project
County Road 2 Trail Extension
Government Center Design
2013 Street Overlays
Total
Expended
Contract through
Amount 12/31/13 Commitment
$ 346,442 $ 310,960 $ 35,482
266,102 103,842 162,260
312,501 229,102 83,399
NOTE 12 — RELATED PARTY TRANSACTION
$ 281,141
The St. Joseph EDA has issued Public Project Revenue Bonds of 2005A. These Bonds are to finance
the City Hall and maintenance facility projects. Rental payments are due from the City to the St. Joseph
EDA. The City will own the projects upon completion of the rental payments. Since the St. Joseph
EDA is reported as a blended component unit of the City the lease transactions are not reported. The
debt and projects are recorded as though part of the City.
NOTE 13 — CHANGE IN ACCOUNTING PRINCIPLE
For the year ended December 31, 2013, the City implemented GASB Statement No. 65. The Statement
establishes standards of financial reporting for deferred outflows and deferred inflows as established by
GASB Statement No. 63. This statement also eliminated the recognition of deferred charges associated
with bond issuances resulting in a restatement of beginning Net Position of $ 155,584 and $ 193,715;
respectively in the Governmental Activities and Business -Type Activities on the Statement of Activities
and $ 165,361 and $ 28,354, respectively, in the Water and Sanitary Sewer Funds on the Statement of
revenues, Expenses and Changes in Net Position — Proprietary Funds.
63
CITY OF ST. JOSEPH
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2013
NOTE 14 — GASB STATEMENTS ISSUED BUT NOT YET IMPLEMENTED
GASB Statement No. 68 replaces the requirements of Statement No. 27, Accounting for Pensions by
State and Local Governmental Employers and Statement No. 50, Pension Disclosures, as they relate to
governments that provide pensions through pension plans administered as trusts or similar arrangements
that meet certain criteria. Statement 68 requires governments providing defined benefit pensions to
recognize their long -term obligation for pension benefits as a liability for the first time, and to more
comprehensively and comparably measure the annual costs of pension benefits.
NOTE 15 — CONTINGENCIES
In the normal course of operations, the City is exposed to various claims and litigation. As of
December 31, 2013, none of these activities are deemed to have a material impact on the City's financial
statements.
.,
REQUIRED SUPPLEMENTARY INFORMATION
65
CITY OF ST. JOSEPH
SCHEDULE OF FUNDING PROGRESS - OTHER POST EMPLOYMENT BENEFITS
December 31, 2013
* This Schedule was implemented in 2009. The City has had two actuarial studies complete to date;
therefore, the Schedule contains only two years of data. See Note 10 in the Notes to the Financial
Statements for more details on this Schedule.
Tel
Actuarial
UAAL as a
Actuarial
Accrued Liability
Unfunded
Percentage of
Actuarial
Value of
(AAL) -
AAL
Funded
Covered
Covered
Valuation
Assets
Entry Age
(UAAL)
Ratio
Payroll
Payroll
Date
(a)
(b)
(b -a)
(a/b)
(c)
((b -a) /c)
12/31/09
$ -
$ 345,319
$ 345,319
0.0%
$ 1,070,515
32.3%
12/31/12
-
239,852
239,852
0.0%
1,386,050
17.3%
* This Schedule was implemented in 2009. The City has had two actuarial studies complete to date;
therefore, the Schedule contains only two years of data. See Note 10 in the Notes to the Financial
Statements for more details on this Schedule.
Tel
SUPPLEMENTARY INFORMATION
67
CITY OF ST. JOSEPH
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES -
BUDGET AND ACTUAL - GENERAL FUND
For the Year Ended December 31, 2013
68
Variance with
Original
Final
Actual
Final Budget -
Budget
Budget
Amounts
Over (Under)
REVENUES
Property Taxes
$ 1,154,645
$ 1,154,645
$ 1,152,540
$ (2,105)
Sales Taxes
-
-
(7)
(7)
Special Assessments
1,500
1,500
2,080
580
Franchise Fees
114,800
114,800
117,894
3,094
Licenses and Permits
90,605
90,605
97,192
6,587
Intergovernmental Revenue:
Local Government Aid
645,150
645,150
645,151
1
PERA Aid
1,540
1,540
1,541
1
Fire Aid
39,000
39,000
53,961
14,961
Police Aid
48,500
48,500
55,137
6,637
Federal Grants
8,000
8,000
101,880
93,880
State Grants
7,145
7,145
8,473
1,328
Other Grants and Aids
19,000
19,000
18,227
(773)
Total Intergovernmental Revenue
768,335
768,335
884,370
116,035
Charges for Services:
General Government
25,650
25,650
37,071
11,421
Public Safety
192,375
192,375
194,922
2,547
Public Works
3,550
3,550
4,041
491
Culture and Recreation
9,200
9,200
8,665
(535)
Total Charges for Services
230,775
230,775
244,699
13,924
Fines and Forfeitures
62,500
62,500
45,439
(17,061)
Miscellaneous Revenues:
Investment Income
26,000
26,000
442
(25,558)
Contributions and Donations
37,590
37,590
38,174
584
Other
44,150
44,150
43,632
(518)
Total Miscellaneous Revenues
107,740
107,740
82,248
(25,492)
Total Revenues
2,530,900
2,530,900
2,626,455
95,555
EXPENDITURES
General Government
Mayor and Council
65,670
65,670
69,822
4,152
Administrative and Finance
350,530
350,530
315,484
(35,046)
Other General Government
103,870
103,870
100,472
(3,398)
Capital Outlay
6,250
3,000
17,784
14,784
Total General Government
526,320
523,070
503,562
(19,508)
68
CITY OF ST. JOSEPH
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES -
BUDGET AND ACTUAL - GENERAL FUND
For the Year Ended December 31, 2013
EXPENDITURES
Public Safety
Police:
Current
Capital Outlay
Total Police
Fire:
Current
Capital Outlay
Total Fire
Other:
Current
Capital Outlay
Total Other
Total Public Safety
Public Works
Streets and Highways:
Street Maintenance and Storm Sewers
Snow and Ice Removal
Street Engineering
Street Lighting
Capital Outlay
Total Public Works
Culture and Recreation
Current
Capital Outlay
Total Culture and Recreation
Total Expenditures
Excess of Revenues Over
(Under) Expenditures
OTHER FINANCING SOURCES (USES)
Insurance Recoveries
Sale of Property
Transfers In
Transfers Out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
FUND BALANCES
Beginning of Year
End of Year
226,270
226,270
223,900
Variance with
Original
91,700
Actual
Final Budget -
Budget
Final Budget
Amounts
Over (Under)
$ 941,265
$ 941,265
$ 977,228
$ 35,963
4,845
-
-
-
946,110
941,265
977,228
35,963
333,600
333,600
331,669
(1,931)
40,700
40,700
121,771
81,071
374,300
374,300
453,440
79,140
96,450
96,450
96,450
-
2,000
-
-
-
226,270
226,270
223,900
(2,370)
91,700
91,700
94,427
2,727
35,000
35,000
26,608
(8,392)
8,500
-
-
-
30,190
25,000
31,264
6,264
391,660
377,970
376,199
(1,771)
214,185
214,185
196,504
(17,681)
10,375
-
-
-
224,560
214,185
196,504
(17,681)
2,561,400
2,527,240
2,603,383
76,143
(30,500)
3,660
23,072
19,412
-
-
6,000
6,000
-
-
629
629
2,000
2,000
20,416
18,416
-
-
(34,160)
(34,160)
2,000
2,000
(7,115)
(9,115)
$ (28,500)
$ 5,660
15,957 $
10,297
1,705,274
$ 1,721,231
69
CITY OF ST. JOSEPH
COMBINING BALANCE SHEET -
NONMAJOR GOVERNMENTAL FUNDS
December 31, 2013
ASSETS
Cash and Investments
Taxes Receivable - Delinquent
Special Assessments Receivable:
Delinquent
Deferred
Accounts Receivable
Interest Receivable
Due from Other Funds
Due from Other Governments
Notes Receivable
Total Assets
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities
Accounts Payable
Contracts Payable
Due to Other Funds
Total Liabilities
Deferred Inflows Of Resources
Unavailable Revenue - Property Taxes
Unavailable Revenue - Special Assessments
Unavailable Revenue - Notes Receivable
Total Deferred Inflows of Resources
Fund Balances
Restricted
Committed
Assigned
Unassigned
Total Fund Balances
Total Liabilities, Deferred Inflows
of Resources and Fund Balances
Special Revenue
$ 4,934 $ - $ - $ 2,437
- - - 140,827
- - 500 -
4,934 - 500 143,264
1,962 - - -
1,962 - - -
- 14,120 - 1,272,767
112,486 - - -
- - (466) -
112,486 14,120 (466) 1,272,767
$ 119,382 $ 14,120 $ 34 $ 1,416,031
70
TIF 2 -1
TIF 2 -2 St.
Economic
Millstream
Joseph Meat
Development
Shops and
Market
State Collected
Authority (150)
Lofts (157)
(158)
Sales Tax (200)
$ 116,318
$ 14,115
$ 34
$ 1,340,119
1,962
-
-
-
33
5
-
-
500
-
-
-
569
-
-
75,912
$ 119,382
$ 14,120
$ 34
$ 1,416,031
$ 4,934 $ - $ - $ 2,437
- - - 140,827
- - 500 -
4,934 - 500 143,264
1,962 - - -
1,962 - - -
- 14,120 - 1,272,767
112,486 - - -
- - (466) -
112,486 14,120 (466) 1,272,767
$ 119,382 $ 14,120 $ 34 $ 1,416,031
70
Special Revenue
Debt Service
$ 53 $
- $ -
$ 7,424
$ 65
$ 132
G.O.
- -
140,827
-
-
G.O. Crossover
Improvement
Park
Charitable
-
53
Refunding
Refunding
Dedication
Gambling
Revolving
Bonds of
Bonds of
(205)
(215)
Loan (250)
Total
2009A (318)
2007B (320)
- -
-
450,173
46,354
-
- 29,035
$ 54,660
$ 3,947
$ 30,853
$ 1,560,046
$ 378,931
$ 90,199
-
-
-
1,962
2,107
-
-
-
-
-
2,351
3,403
-
-
-
-
447,822
42,951
32
-
-
32
-
-
22
2
9
71
152
62
-
-
-
500
-
-
-
-
-
76,481
21,654
867
-
-
29,035
29,035
-
-
$ 54,714
$ 3,949
$ 59,897
$ 1,668,127
$ 853,017
$ 137,482
$ 53 $
- $ -
$ 7,424
$ 65
$ 132
-
- -
140,827
-
-
-
- -
500
-
-
53
- -
148,751
65
132
-
- -
1,962
2,107
-
-
- -
-
450,173
46,354
-
- 29,035
29,035
-
-
-
- 29,035
30,997
452,280
46,354
54,661
3,949 30,862
1,376,359
400,672
90,996
-
- -
112,486
-
-
-
- -
(466)
-
-
54,661
3,949 30,862
1,488,379
400,672
90,996
$ 54,714 $
3,949 $ 59,897
$ 1,668,127
$ 853,017
$ 137,482
71
CITY OF ST. JOSEPH
COMBINING BALANCE SHEET -
NONMAJOR GOVERNMENTAL FUNDS
December 31, 2013
72
Debt Service
City Hall
G.O.
G.O. EDA
Fire Hall G.O.
Improvement
G.O.
Refunding
Refunding
Bonds of
Improvement
Bonds of
Bonds of
200513/201013
Bonds of
2005A (322)
2003B (331)
(333)
2013A (348)
ASSETS
Cash and Investments
$ 3,801
$ 96,884
$ 279,471
$ 85,293
Taxes Receivable - Delinquent
2,795
858
388
-
Special Assessments Receivable:
Delinquent
-
-
128,275
-
Deferred
-
-
417,375
72,336
Accounts Receivable
-
-
-
-
Interest Receivable
5
37
119
22
Due from Other Funds
-
-
-
-
Due from Other Governments
462
129
53
-
Notes Receivable
-
-
-
-
Total Assets
$ 7,063
$ 97,908
$ 825,681
$ 157,651
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities
Accounts Payable
$ 65
$ 65
$ 64
$ 65
Contracts Payable
-
-
-
-
Due to Other Funds
-
-
-
-
Total Liabilities
65
65
64
65
Deferred Inflows Of Resources
Unavailable Revenue - Property Taxes
2,795
858
388
-
Unavailable Revenue - Special Assessments
-
-
545,650
72,336
Unavailable Revenue - Notes Receivable
-
-
-
-
Total Deferred Inflows of Resources
2,795
858
546,038
72,336
Fund Balances
Restricted
4,203
96,985
279,579
85,250
Committed
-
-
-
-
Assigned
-
-
-
-
Unassigned
-
-
-
-
Total Fund Balances
4,203
96,985
279,579
85,250
Total Liabilities, Deferred Inflows
of Resources and Fund Balances
$ 7,063
$ 97,908
$ 825,681
$ 157,651
72
Debt Service
df J,G 1G df 470,06.3 ID OJ V,OJJ lb /,4VJ df 4,J.31 df 4GG,J JO df 1,701
$ 65
G.O.
$ 65 $
65 $
G.O.
$ 65 $
65
G.O.
Improvement
G.O.
G.O. Capital
Certificates of
G.O.
G.O.
Certificates of
Bonds of
Improvement
Improvement
Indebtedness
Improvement
Certificates of
Indebtedness of
2011A/2006C
Bonds of
Plan Bonds of
of 2010A
Bonds of
Indebtedness of
2013A (349)
(338)
2007A (341)
2009B (343)
(344)
2010B (345)
2011A (346)
$ 5,191
$ 149,632
$ 451,442
$ 5,161
$ 3,597
$ 215,136
$ 1,560
-
1,500
329
1,911
770
175
328
-
2,356
-
-
-
-
-
-
341,156
178,711
-
-
207,143
-
21
76
163
5
3
76
1
-
1.963
8
326
161
26
92
df J,G 1G df 470,06.3 ID OJ V,OJJ lb /,4VJ df 4,J.31 df 4GG,J JO df 1,701
$ 65
$ 66
$ 65 $
65 $
65
$ 65 $
65
65
66
65
65
65
65
65
-
1,500
329
1,911
770
175
328
-
343,512
178,711
-
-
207,143
-
-
345,012
179,040
1,911
770
207,318
328
5,147
151,605
451,548
5,427
3,696
215,173
1,588
5,427
1,588
151,605
451,548
3,696
215,173
5,147
$ 5,212
$ 496,683
$ 630,653 $
7,403 $
4,531
$ 422,556 $
1,981
73
CITY OF ST. JOSEPH
COMBINING BALANCE SHEET -
NONMAJOR GOVERNMENTAL FUNDS
December 31, 2013
Debt Service Capital Projects
G.O. Capital
74
Improvement
Debt Service
2013 Street
Plan Bonds of
Relief Fund
Improvements
2011A (347)
(390)
Total
(448)
ASSETS
Cash and Investments
$ 12,287
$ 288,442
$
2,067,027
$ 105,699
Taxes Receivable - Delinquent
394
190
11,745
-
Special Assessments Receivable:
Delinquent
-
-
136,385
-
Deferred
-
13,144
1,720,638
-
Accounts Receivable
-
-
-
-
Interest Receivable
61
-
803
-
Due from Other Funds
-
-
-
-
Due from Other Governments
102
2
25,845
-
Notes Receivable
-
-
-
-
Total Assets
$ 12,844
$ 301,778
$
3,962,443
$ 105,699
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities
Accounts Payable
$ 65
$ 26,360
$
27,337
$ 948
Contracts Payable
-
-
-
11,455
Due to Other Funds
-
-
-
-
Total Liabilities
65
26,360
27,337
12,403
Deferred Inflows Of Resources
Unavailable Revenue - Property Taxes
394
190
11,745
-
Unavailable Revenue - Special Assessments
-
13,144
1,857,023
-
Unavailable Revenue - Notes Receivable
-
-
-
-
Total Deferred Inflows of Resources
394
13,334
1,868,768
-
Fund Balances
Restricted
12,385
-
1,804,254
-
Committed
-
-
-
-
Assigned
-
262,084
262,084
93,296
Unassigned
-
-
-
-
Total Fund Balances
12,385
262,084
2,066,338
93,296
Total Liabilities, Deferred Inflows
of Resources and Fund Balances
$ 12,844
$ 301,778
$
3,962,443
$ 105,699
74
$ 168,821 $ - $ 9,000 $ - $ - $ 178,769 $ 213,530
- - - - - 11,455 152,282
- - - - - - 500
168,821 - 9,000 - - 190,224 366,312
- - - - - - 13,707
- - - - - - 1,857,023
- - - - - - 29,035
- - - - - - 1,899,765
- - - - - - 3,180,613
- - - - - - 112,486
50,175 174,042 193,752 563 586,054 1,097,882 1,359,966
- - - - - - (466)
50,175 174,042 193,752 563 586,054 1,097,882 4,652,599
$ 218,996 $ 174,042 $ 202,752 $ 563 $ 586,054 $ 1,288,106 $ 6,918,676
75
Capital Projects
City
2013
Hall/Police
Equipment
Garage Capital
General
Total
Certificates
Improvements
Capital
Water Access
Sewer Access
Governmental
(449)
(447)
Outlay (490)
Fund (501)
Fund (502)
Total
Funds
$ 200,496
$ 174,042
$ 202,752
$ 44
$ 585,859
$ 1,268,892
$ 4,895,965
-
-
-
-
-
-
13,707
-
-
-
-
-
-
136,385
-
-
-
-
-
-
1,720,638
18,500
-
-
500
-
19,000
19,032
-
-
-
19
195
214
1,088
-
-
-
-
-
-
500
-
-
-
-
-
-
102,326
-
-
-
-
-
-
29,035
$ 218,996
$ 174,042
$ 202,752
$ 563
$ 586,054
$ 1,288,106
$ 6,918,676
$ 168,821 $ - $ 9,000 $ - $ - $ 178,769 $ 213,530
- - - - - 11,455 152,282
- - - - - - 500
168,821 - 9,000 - - 190,224 366,312
- - - - - - 13,707
- - - - - - 1,857,023
- - - - - - 29,035
- - - - - - 1,899,765
- - - - - - 3,180,613
- - - - - - 112,486
50,175 174,042 193,752 563 586,054 1,097,882 1,359,966
- - - - - - (466)
50,175 174,042 193,752 563 586,054 1,097,882 4,652,599
$ 218,996 $ 174,042 $ 202,752 $ 563 $ 586,054 $ 1,288,106 $ 6,918,676
75
CITY OF ST. JOSEPH
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
NONMAJOR GOVERNMENTAL FUNDS
For the Year Ended December 31, 2013
Special Revenue
76
Economic
TIF 2 -1
TIF 2 -2 St.
Development
Millstream
Joseph Meat
State Collected
Park
Authority
Shops and
Market
Sales Tax
Dedication
(150)
Lofts (157)
(158)
(200)
(205)
REVENUES
Property Taxes
$ 124,883
$
$
$
$
Tax Increments
-
34,911
3,725
-
Sales Taxes
-
-
360,909
Special Assessments
-
-
Intergovernmental
27,395
Charges for Services
-
-
166
Miscellaneous:
Investment Income
30
4
20
Contributions and Donations
-
-
15,625
Revolving Loan Repayments
-
Other
-
-
-
-
-
Total Revenues
152,308
34,915
3,725
360,909
15,811
EXPENDITURES
Current
Public Works
-
-
-
-
-
Culture and Recreation
-
-
-
2,155
Economic Development
117,473
31,639
3,721
-
Debt Service
Principal
-
-
-
Interest and Other Charges
-
Capital Outlay
General Government
89,656
Public Safety
-
Public Works
-
-
Culture and Recreation
-
-
-
282,585
32,806
Total Expenditures
117,473
31,639
3,721
372,241
34,961
Excess of Revenues Over
(Under) Expenditures
34,835
3,276
4
(11,332)
(19,150)
OTHER FINANCING SOURCES (USES)
Sale of Property
-
-
-
Bonds Issued
Bond Premium
Refunding Bond Payment
-
-
Transfers In
19,274
3,000
Transfers Out
-
-
Total Other Financing Sources (Uses)
-
-
-
19,274
3,000
Net Change in Fund Balances
34,835
3,276
4
7,942
(16,150)
FUND BALANCES
Beginning of Year
77,651
10,844
(470)
1,264,825
70,811
End of Year
$ 112,486
$ 14,120
$ (466)
$ 1,272,767
$ 54,661
76
Special Revenue
Debt Service
77
G.O.
G.O. Crossover
Improvement
City Hall G.O.
Charitable
Refunding
Refunding
EDA Refunding
Recreation
Gambling
Revolving Loan
Bonds of
Bonds of 2007B
Bonds of 2005A
Center(210)
(215)
(250)
Total
2009A (318)
(320)
(322)
$
$
$
$ 124,883
$ 73,882
$ 93
$ 93,997
38,636
-
-
-
360,909
-
-
-
173,479
61,183
27,395
-
-
166
-
-
-
(1)
1
8
62
138
56
5
-
-
-
15,625
-
-
-
8,083
8,083
(1)
1
8,091
575,759
247,499
61,332
94,002
1,291
3,446
-
152,833
-
-
-
-
315,000
160,000
80,000
-
48,619
11,461
11,137
89,656
-
-
-
8,093
-
323,484
-
-
-
8,093
1,291
-
569,419
363,619
171,461
91,137
(8,094)
(1,290)
8,091
6,340
(116,120)
(110,129)
2,865
22,274
80,000
3,050
(19,274)
(19,274)
-
-
(19,274)
-
3,000
80,000
3,050
-
(27,368)
(1,290)
8,091
9,340
(36,120)
(107,079)
2,865
27,368
5,239
22,771
1,479,039
436,792
198,075
1,338
$
$ 3,949
$ 30,862
$ 1,488,379
$ 400,672
$ 90,996
$ 4,203
77
CITY OF ST. JOSEPH
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
NONMAJOR GOVERNMENTAL FUNDS
For the Year Ended December 31, 2013
78
Debt Service
G.O.
Improvement
G.O.
G.O.
Fire Hall G.O.
Bonds of
Improvement
Certificates of
Refunding Bonds
200513/201013
Bonds of
Indebtedness of
of 2003B (331)
(333)
2013A (348)
2013A (349)
REVENUES
Property Taxes
$ 25,661
$ 10,059
$
$
Tax Increments
-
-
Sales Taxes
-
Special Assessments
38,468
77,054
Intergovernmental
-
-
-
Charges for Services
29,085
-
-
-
Miscellaneous:
Investment Income
34
109
127
78
Contributions and Donations
-
-
-
-
Revolving Loan Repayments
Other
-
-
-
-
Total Revenues
54,780
48,636
77,181
78
EXPENDITURES
Current
Public Works
-
-
-
-
Culture and Recreation
Economic Development
-
-
Debt Service
Principal
70,000
125,000
-
-
Interest and Other Charges
7,555
22,103
11,990
7,868
Capital Outlay
General Government
-
-
-
-
Public Safety
Public Works
Culture and Recreation
-
-
-
Total Expenditures
77,555
147,103
11,990
7,868
Excess of Revenues Over
(Under) Expenditures
(22,775)
(98,467)
65,191
(7,790)
OTHER FINANCING SOURCES (USES)
Sale of Property
-
-
Bonds Issued
16,210
5,665
Bond Premium
3,849
7,272
Refunding Bond Payment
-
-
Transfers In
Transfers Out
-
-
Total Other Financing Sources (Uses)
20,059
12,937
Net Change in Fund Balances
(22,775)
(98,467)
85,250
5,147
FUND BALANCES
Beginning of Year
119,760
378,046
-
-
End of Year
$ 96,985
$ 279,579
$ 85,250
$ 5,147
78
Debt Service
G.O.
309,963 (12,574)
G.O.
1,120
(20,159)
122
1,698,333
Improvement
G.O.
Certificates of
G.O. Capital
1,466
G.O.
G.O.
Bonds of
Improvement
Indebtedness
Improvement
G.O. Certificates
Improvement
Certificates of
2011A/2006C
Bonds of
of 2008A
Plan Bonds of
of Indebtedness of
Bonds of 2010B
Indebtedness of
(338)
2007A (341)
(342)
2009B (343)
2010A (344)
(345)
2011A (346)
$ 41,976
$ 157
$ 50,126
$ 66,735
$ 33,849
$ 5,032
$ 19,973
65,429
22,023
24,418
-
-
-
-
-
-
22,863
3,821
148
7
4
2
70
1
111,226
22,328
50,133
66,739
33,851
29,520
42,837
117
150,000 65,000 60,000 55,000 30,000 45,000 35,000
87,954 14,324 2,291 10,931 2,731 17,812 7,715
(126,728) (56,996) (12,158) 808 1,120 (33,409) 122
(1,435,000) -
15,000 366,959 -
- - (416)
(1,420,000) 366,959 (416)
13,250
13,250
(1,546,728)
309,963 (12,574)
808
1,120
(20,159)
122
1,698,333
141,585 12,574
4,619
2,576
235,332
1,466
$ 151,605
$ 451,548 $ $
5,427 $
3,696
$ 215,173 $
1,588
79
CITY OF ST. JOSEPH
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
NONMAJOR GOVERNMENTAL FUNDS
For the Year Ended December 31, 2013
Debt Service
G.O. Capital
Capital Projects
80
Improvement
Debt Service
Jade Road Street
Plan Bonds of
Relief Fund
Improvements
2011A (347)
(390)
Total
(441)
REVENUES
Property Taxes
$ 21,872
$ 215
$ 443,627
$
Tax Increments
-
-
-
Sales Taxes
-
-
Special Assessments
3,362
465,416
Intergovernmental
17,200
17,200
Charges for Services
-
-
51,948
Miscellaneous:
Investment Income
56
4,656
Contributions and Donations
-
-
Revolving Loan Repayments
Other
-
-
-
Total Revenues
21,928
20,777
982,847
EXPENDITURES
Current
Public Works
-
-
117
Culture and Recreation
-
Economic Development
-
-
Debt Service
Principal
20,000
1,210,000
Interest and Other Charges
4,075
268,566
Capital Outlay
General Government
-
-
Public Safety
-
-
Public Works
39,552
39,552
Culture and Recreation
-
-
Total Expenditures
24,075
39,552
1,518,235
Excess of Revenues Over
(Under) Expenditures
(2,147)
(18,775)
(535,388)
OTHER FINANCING SOURCES (USES)
Sale of Property
-
Bonds Issued
21,875
Bond Premium
11,121
Refunding Bond Payment
(1,435,000)
Transfers In
478,259
Transfers Out
(228,000)
(228,416)
(366,959)
Total Other Financing Sources (Uses)
(228,000)
(1,152,161)
(366,959)
Net Change in Fund Balances
(2,147)
(246,775)
(1,687,549)
(366,959)
FUND BALANCES
Beginning of Year
14,532
508,859
3,753,887
366,959
End of Year
$ 12,385
$ 262,084
$ 2,066,338
$
80
Capital Projects
2013
City Hall/Police
1
520
6,047
2013 Street Equipment
Garage Capital
General
-
13,615
Total Other
Improvements Certificates
Improvements
Capital
Water Access
Sewer Access
11,449
Governmental
(448) (449)
(447)
Outlay (490)
Fund (501)
Fund (502)
Total
Funds
$ $
$
$
$
$
$
$ 568,510
41,371
-
-
564,707
2,652,361
38,636
360,909
(227,841)
(1)
(30,583)
116,709
59,405
(377,805)
465,416
-
18,681
-
1,850
-
-
44,595
20,531
388,790
259,335
116,570
59,227
175,797
227,911
648,125
670,000
-
139
178
317
5,035
-
6,638
-
-
6,638
22,263
-
(1,435,000)
-
8,083
22,660
4,150
-
-
4,150
4,150
(20,000)
10,788
116,709
59,405
186,902
1,745,508
117
3,446
152,833
1,210,000
268,566
81
5,526
1
520
6,047
95,703
-
40,391
-
13,615
54,006
54,006
295,494
93,471
11,449
400,414
439,966
-
88,453
-
15,787
104,240
427,724
295,494
227,841
1
41,371
-
-
564,707
2,652,361
(295,494)
(227,841)
(1)
(30,583)
116,709
59,405
(377,805)
(906,853)
-
18,681
-
1,850
-
-
20,531
20,531
388,790
259,335
-
648,125
670,000
-
-
-
11,121
-
-
(1,435,000)
22,660
22,660
523,193
-
-
(20,000)
(136,900)
(50,250)
(574,109)
(821,799)
388,790
278,016
-
4,510
(136,900)
(50,250)
117,207
(1,031,954)
93,296
50,175
(1)
(26,073)
(20,191)
9,155
(260,598)
(1,938,807)
-
-
174,043
219,825
20,754
576,899
1,358,480
6,591,406
$ 93,296
$ 50,175 $
174,042
$ 193,752
$ 563
$ 586,054
$ 1,097,882
$ 4,652,599
81
K DV
expert advice. When you need it.'
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF
FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH
GOVERNMENT A UDITING STANDARDS
Honorable Mayor and Members
of the City Council
City of St. Joseph
St. Joseph, Minnesota
We have audited, in accordance with the auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards
issued by the Comptroller General of the United States, the financial statements of the governmental
activities, the business -type activities, each major fund and the aggregate remaining fund information of
the City of St. Joseph, Minnesota, as of and for the year ended December 31, 2013 and the related Notes
to the Financial Statements, which collectively comprise the City's basic financial statements, and have
issued our report thereon dated April 10, 2014.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City's internal
control over financial reporting (internal control) to determine the audit procedures that are appropriate
in the circumstances for the purpose of expressing our opinions on the financial statements, but not for
the purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly, we
do not express an opinion on the effectiveness of the City's internal control.
Our consideration of internal control was for the limited purpose described in the preceding paragraph
and was not designed to identify all deficiencies in internal control that might be material weaknesses or
significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were
not identified. However, as described in the accompanying Schedule of Finding and Response on
Internal Control, we identified a certain deficiency in internal control that we consider to be a material
weakness.
KD-V
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent or
detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a
combination of deficiencies, in internal control such that there is a reasonable possibility that a material
misstatement of the City's financial statements will not be prevented or detected and corrected on a
timely basis. We consider the deficiencies described in the accompanying Schedule of Finding and
Response on Internal Control to be a material weakness, listed as Audit Finding 06 -01.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City's financial statements are free from
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts and grant agreements, noncompliance with which could have a direct and material effect on the
determination 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 no instances of noncompliance or other matters that are required to be
reported under Government Auditing Standards.
City's Response to Findings
The City's response to the finding identified in our audit is described in the accompanying Schedule of
Finding and Response on Internal Control. The City's response was not subjected to the auditing
procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and
compliance and the results of that testing, and not to provide an opinion on the effectiveness of the
City's internal control or on compliance. This report is an integral part of an audit performed in
accordance with Government Auditing Standards in considering the City's internal control and
compliance. Accordingly, this communication is not suitable for any other purpose.
/�,, Pe W, 4, U-i�, b i�-
KERN, DEWENTER, VIERE, LTD.
St. Cloud, Minnesota
April 10, 2014
K DV
Expert advice. When you need it."
REPORT ON LEGAL COMPLIANCE
Honorable Mayor and Members
of the City Council
City of St. Joseph
St. Joseph, Minnesota
We have audited, in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller general of the United States, the financial statements of the governmental
activities, the business -type activities, each major fund and the aggregate remaining fund information of
the City of St. Joseph, Minnesota, as of and for the year ended December 31, 2013, which collectively
comprise the City's basic financial statements and have issued our report thereon dated April 10, 2014.
The Minnesota Legal Compliance Audit Guide for Political Subdivisions, promulgated by the State
Auditor pursuant to Minnesota Statutes § 6.65, contains seven categories of compliance to be tested:
contracting and bidding, deposits and investments, conflicts of interest, public indebtedness, claims and
disbursements, miscellaneous provisions and tax increment financing. Our audit considered all of the
listed categories.
In connection with our audit, nothing came to our attention that caused us to believe that the City of
St, Joseph failed to comply with the provisions of the Minnesota Legal Compliance Audit Guide for
Political Subdivisions. However, our audit was not directed primarily toward obtaining knowledge of
such noncompliance. Accordingly, had we performed additional procedures, other matters may have
come to our attention regarding the City's noncompliance with the above referenced provisions.
The purpose of this report is solely to describe the scope of our testing of compliance and the results of
that testing, and not to provide an opinion on compliance. Accordingly, this communication is not
suitable for any other purpose.
KERN, DEWENTER, VIERE, LTD.
St. Cloud, Minnesota
April 10, 2014
.,
CITY OF ST. JOSEPH
SCHEDULE OF FINDING AND RESPONSE ON
INTERNAL CONTROL
December 31, 2013
CURRENT AND PRIOR YEAR INTERNAL CONTROL FINDING:
Material Weakness:
Audit Finding 06 -01 — Improve Segregation of Accounting Duties
Adequate segregation of accounting duties is in place when the four areas of a transaction have been
separated: authorization, custody, recording and reconciliation.
As part of this year's audit, we reviewed the City's documentation of its internal control over
significant areas including: cash receipts, cash disbursements, capital assets, payroll and utility
billing. The lack of adequate segregation of accounting duties could adversely affect the City's
ability to initiate, record, process and report financial data consistent with the assertions of
management in the financial statements. Some of the areas in which we noticed a lack of segregation
or an overlap in duties are as follows:
Cash Receipts
The Office Specialist or City Administrator enters cash and checks into the point of sale system,
reconciles the entries and prepares the deposit. The Police Records Specialist records police
receipts, receives payments and reconciles the collections. The Finance Director or police take
deposits to the bank.
Cash Disbursements
The Finance Director approves some invoices for payment, enters invoices into the system,
generates checks and a check register. The Finance Director is also an authorized signer and has
access to the Mayor's electronic signature. The Administrator reviews and approves checks for
payment. At year -end, the Finance Director reconciles and records accounts and contracts
payable.
Capital Assets
The Finance Director records, processes, reconciles and posts journal entries related to capital
assets. The department heads review their listing for accuracy.
Payroll
The Finance Director enters employees' time, processes and posts payroll, generates a payroll
report, distributes paystubs to employees, and posts the journal entries related to payroll. In
addition, this same employee reconciles payroll accruals and time off balances. The City
Administrator does review payroll reports and time off balances and calculates compensated
absences balances for the audit.
CITY OF ST. JOSEPH
SCHEDULE OF FINDING AND RESPONSE ON
INTERNAL CONTROL
December 31, 2013
CURRENT AND PRIOR YEAR INTERNAL CONTROL FINDING:
Material Weakness: (Continued)
Audit Finding 06 -01— Improve Segregation of Accounting Duties (Continued)
Utility Billing
The Utility Billing Clerk enters new accounts into the utility billing system and uploads meter
readings via interfacing with electronic readers. The Utility Billing Clerk enters any rate changes
to the system and can enter manual adjustments. The Utility Billing Clerk calculates and enters
final bills, prints and mails utility bills, reconciles receipts to billed amounts and enters receipts
batches.
Cash Reconciliation and Access
The Finance Director performs the above noted responsibilities, while also reconciling cash and
generating manual journal entries.
City's Response:
The City Council and City staff are aware of the limited personnel handling the City's financial
matters. The processes and internal controls are reviewed frequently to look for ways to improve
internal controls. The department heads, City Administrator and City Council each have active roles
in monitoring the financial matters of the City to provided additional oversight. It is unlikely
complete segregation of accountings duties will be achieved due to the cost of hiring several
additional staff.
CITY OF ST. JOSEPH
COMMUNICATIONS LETTER
Year Ended December 31, 2013
CITY OF ST. JOSEPH
TABLE OF CONTENTS
REPORT ON MATTERS IDENTIFIED AS A RESULT OF
THE AUDIT OF THE FINANCIAL STATEMENTS .................. ...............................
MATERIAL WEAKNESS ................................................................. ...............................
OTHERDEFICIENCY ...................................................................... ...............................
REQUIRED COMMUNICATION ................................................... ...............................
FINANCIALANALYSIS ................................................................... ...............................
1
3
4
5
8
K,DV
Expert advice. When you need it.'
REPORT ON MATTERS IDENTIFIED AS A RESULT OF
THE AUDIT OF THE FINANCIAL STATEMENTS
Honorable Mayor, Members
of the City Council and Management
City of St. Joseph
St. Joseph, Minnesota
In planning and performing our audit of the financial statements of the City of St. Joseph, Minnesota, as
of and for the year ended December 31, 2013, in accordance with auditing standards generally accepted
in the United States of America and Government Auditing Standards, we considered the City's internal
control over financial reporting (internal control) as a basis for designing our auditing procedures that
are appropriate in the circumstances for the purpose of expressing our opinion on the financial
statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal
control. Accordingly, we do not express an opinion on the effectiveness of the City's internal control.
Our consideration of internal control was for the limited purpose described in the preceding paragraph
and was not designed to identify all deficiencies in internal control that might be material weaknesses or
significant deficiencies and, therefore, material weaknesses or significant deficiencies may exist that
were not identified.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent or
detect and correct misstatements on a timely basis. A material weakness is a deficiency or a
combination of deficiencies in internal control, such that there is a reasonable possibility that a material
misstatement of the City's financial statements will not be prevented or detected and corrected on a
timely basis. The material weakness identified is stated within this letter.
A significant deficiency is a deficiency, or combination of deficiencies, in internal control that is less
severe than a material weakness, yet important enough to merit attention by those charged with
governance.
During our audit, we also became aware of a deficiency in internal control other than significant
deficiencies or material weaknesses, and other matters that are opportunities for strengthening internal
controls and operating efficiency. It is described in the accompanying letter under Other Deficiency.
The accompanying memorandum also includes financial analysis provided as a basis for discussion.
The matters discussed herein were considered by us during our audit and they do not modify the opinion
expressed in our Independent Auditor's Report dated April 10, 2014, on such statements.
KDV
This communication is intended solely for the information and use of management, the City Council,
others within the City and state oversight agencies and is not intended to be and should not be used by
anyone other than these specified parties.
44,v, Pe v-A-� w-
KERN, DEWENTER, VIERS, LTD.
St. Cloud, Minnesota
April 10, 2014
2
CITY OF ST. JOSEPH
MATERIAL WEAKNESS
December 31, 2013
IMPROVE SEGREGATION OF ACCOUNTING DUTIES
Adequate segregation of accounting duties is in place when the four areas of a transaction have been
separated: authorization, custody, recording and reconciliation.
As part of this year's audit, we reviewed the City's documentation of its internal control over significant
areas including: cash receipts, cash disbursements, capital assets, payroll and utility billing. The lack of
adequate segregation of accounting duties could adversely affect the City's ability to initiate, record,
process and report financial data consistent with the assertions of management in the financial
statements. Some of the areas in which we noticed a lack of segregation or an overlap in duties are as
follows:
Cash Receipts
The Office Specialist or City Administrator enters cash and checks into the point of sale system,
reconcile the entries and prepare the deposit. The Police Records Specialist records police receipts,
receives payments and reconciles the collections. The Finance Director or police take deposits to the
bank.
Cash Disbursements
The Finance Director approves some invoices for payment, enters invoices into the system and
generates checks and a check register. The Finance Director also is an authorized signer and has
access to the Mayor's electronic signature. At year -end, the Finance Director reconciles and records
accounts and contracts payable. The City Administrator reviews and approves checks for payment.
Capital Assets
The Finance Director records, processes, reconciles and posts journal entries related to capital assets.
Department heads review their listing for accuracy.
Payroll
The Finance Director enters employee's time, processes and posts payroll, generates a payroll report,
distributes paystubs to employees, and posts the journal entries related to payroll. In addition, this
same employee reconciles payroll accruals and time off balances. The City Administrator does
review payroll reports and time off balances and calculates compensated absences balances for the
audit.
Utility Billing
The Utility Billing Clerk enters new accounts into the utility billing system and uploads meter
readings via interfacing with electronic readers. The Utility Billing Clerk enters any rate changes to
the system. The Utility Billing Clerk can enter manual adjustments, calculates and enters final bills,
prints and mails utility bills, reconciles receipts to billed amounts and enters receipts batches.
Cash Reconciliation and Access
The Finance Director performs the above noted responsibilities, while also reconciling cash and
generating manual journal entries.
We recommend management and the City Council review the above deficiencies and improve
segregation of accounting duties where possible to build upon the control environment. We also
recommend the City closely follow its internal control plan and follow through with the control
activities that have been designed.
3
CITY OF ST. JOSEPH
OTHER DEFICIENCY
December 31, 2013
POLICE DEPARTMENT DEPOSIT RECONCILIATION
During our testing of police deposits, it was noted no one reviews the police secretary's reconciliation of
the Police Department's daily receipts or records maintained by the Police Department. This could lead
to unrecorded collections the City's Finance Department is not aware of We also noted that deposits are
not being made to the bank in a timely manner.
In addition, we noted that there were several past due, uncollected tickets on hand that were not
currently being pursued. This could result in reduced revenues for the City.
We recommend an additional person other than the Police Secretary reconcile the daily collections to
records maintained by the Police Department and that deposits are made to the bank in a timely manner.
We also recommend that the City develop a process for collecting past due tickets.
M
CITY OF ST. JOSEPH
REQUIRED COMMUNICATION
December 31, 2013
We have audited the financial statements of the City of St. Joseph for the year ended December 31,
2013, and have issued our report thereon dated April 10, 2014. Professional standards require that we
provide you with the following information related to our audit.
OUR RESPONSIBILITY UNDER AUDITING STANDARDS GENERALLY ACCEPTED IN
THE UNITED STATES OF AMERICA AND GOVERNMENT AUDITING STANDARDS
As stated in our engagement letter, our responsibility, as described by professional standards, is to
express an opinion about whether the financial statements prepared by management with your oversight
are fairly presented, in all material respects, in conformity with accounting principles generally accepted
in the United States of America. Our audit of the financial statements does not relieve you or
management of your responsibilities.
As part of our audit, we considered the internal control of the City. Such considerations were solely for
the purpose of determining our audit procedures and not to provide any assurance concerning internal
control.
As part of obtaining reasonable assurance about whether the financial statements are free of material
misstatement, we performed tests of the City's compliance with certain provisions of laws, regulations,
contracts and grant agreements. However, the objective of our tests was not to provide an opinion on
compliance with such provisions.
Our responsibility for the supplementary information accompanying the financial statements, as
described by professional standards, is to evaluate the presentation of the supplementary information in
relation to the financial statements as a whole and to report on whether the supplementary information is
fairly stated, in all material respects, in relation to the financial statements taken as a whole.
PLANNED SCOPE AND TIMING OF THE AUDIT
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements; therefore, our audit involved judgment about the number of transactions to be
examined and the areas to be tested.
Our audit included obtaining an understanding of the City and its environment, including internal
control, sufficient to assess the risks of material misstatement of the financial statements and to design
the nature, timing and extent of further audit procedures. Material misstatements may result from
(1) errors, (2) fraudulent financial reporting, (3) misappropriation of assets, or (4) violations of laws or
governmental regulations that are attributable to the City or to acts by management or employees acting
on behalf of the City.
QUALITATIVE ASPECTS OF ACCOUNTING PRACTICES
Management is responsible for the selection and use of appropriate accounting policies. The significant
accounting policies used by the City are described in Note 1 to the financial statements. The City
implemented GASB Statement 65, items previously reported as assets and liabilities during the year
ended December 31, 2013. We noted no transactions entered into by the City during the year for which
there is a lack of authoritative guidance or consensus. All significant transactions have been recognized
in the proper period.
5
CITY OF ST. JOSEPH
REQUIRED COMMUNICATION
December 31, 2013
QUALITATIVE ASPECTS OF ACCOUNTING PRACTICES
Accounting estimates are an integral part of the financial statements prepared by management and are
based on management's knowledge and experience about past and current events and assumptions about
future events. Certain accounting estimates are particularly sensitive because of their significance to the
financial statements and because of the possibility that future events affecting them may differ
significantly from those expected. The most sensitive estimates affecting the financial statements were:
Depreciation — The City is currently depreciating its capital assets over their estimated useful lives,
as determined by management, using the straight -line method.
Net Other Post Employment Benefits (OPEB) Obligation — This liability is based on an actuarial
study using the estimates of future obligations of the City for post employment benefits.
The financial statement disclosures are neutral, consistent and clear.
DIFFICULTIES ENCOUNTERED IN PERFORMING THE AUDIT
We encountered no difficulties in dealing with management in performing and completing our audit.
CORRECTED AND UNCORRECTED MISSTATEMENTS
Professional standards require us to accumulate all misstatements identified during the audit, other than
those that are clearly trivial, and communicate them to the appropriate level of management. We
identified the following uncorrected misstatement of the financial statements. Management has
determined its effect is immaterial, both individually and in the aggregate, to the financial statements
taken as a whole.
• Interest payable is overstated.
DISAGREEMENTS WITH MANAGEMENT
For purposes of this letter, a disagreement with management is a financial accounting, reporting or
auditing matter, whether or not resolved to our satisfaction that could be significant to the financial
statements or the auditor's report. We are pleased to report that no such disagreements arose during the
course of our audit.
MANAGEMENT REPRESENTATIONS
We requested certain representations from management that are included in the management
representation letter.
0
CITY OF ST. JOSEPH
REQUIRED COMMUNICATION
December 31, 2013
MANAGEMENT CONSULTATIONS WITH OTHER INDEPENDENT ACCOUNTANTS
In some cases, management may decide to consult with other accountants about auditing and accounting
matters, similar to obtaining a "second opinion" on certain situations. If a consultation involves
application of an accounting principle to the City's financial statements or a determination of the type of
auditor's opinion that may be expressed on those statements, our professional standards require the
consulting accountant to check with us to determine that the consultant has all the relevant facts. To our
knowledge, there were no such consultations with other accountants.
OTHER AUDIT FINDINGS OR ISSUES
We generally discuss a variety of matters, including the application of accounting principles and
auditing standards, with management each year prior to retention as the City's auditors. However, these
discussions occurred in the normal course of our professional relationship and our responses were not a
condition to our retention.
OTHER MATTERS
With respect to the supplementary information accompanying the financial statements, we made certain
inquiries of management and evaluated the form, content and methods of preparing the information to
determine that the information complies with accounting principles generally accepted in United States
of America, the method of preparing it has not changed from the prior period, and the information is
appropriate and complete in relation to our audit of the financial statements. We compared and
reconciled the supplementary information to the underlying accounting records used to prepare the
financial statements or to the financial statements themselves.
7
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
The following pages provide graphic representation of select data pertaining to the financial position and
operations of the City for the past five years. Our analysis of each graph is presented to provide a basis
for discussion of past performance and how implementing certain changes may enhance future
performance. We suggest you view each graph and document if our analysis is consistent with yours. A
subsequent discussion of this information should be useful for planning purposes.
GENERAL FUND
For the year ended December 31, 2013, General Fund expenditures exceeded revenues by $ 29,072. In
addition to this, the City received $ 629 in proceeds from the sale of property, $ 20,416 transferred in
from other funds and transferred out $ 34,160 to other funds. This resulted in an increase in the General
Fund balance of $ 15,957. Of the City's General Fund balance at December 31, 2013, $ 560,770 was
assigned for specific expenditures, such as the fire department, elections and a City structure /facility
study. Another $ 6,870 was restricted by PEG access fees restricted for future cable access
expenditures. The City also has $ 19,500 of its fund balance in nonspendable form as the funds have
already been spent on prepaid insurance. The unassigned portion of the fund balance, which includes
monies set aside for working capital, represents approximately five and two- thirds months of the
budgeted 2014 General Fund expenditures. The City's target General Fund balance is to maintain
working capital, a portion of the unassigned balance, in the amount of four to six months of the next
year's budgeted expenditures of the General Fund, excluding the fire department.
The graphs below and on the following page show the City's General Fund balance and the General
Fund revenues and expenditures for the last five years.
$2,000,000
$1,800,000
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
General Fund
$20,339
$15,903 $16,058 $19,500
$48,993 $6=z
$32,448
■ �� $1,034,354 M $1,146,290 $1,134,09
■ $282,973 $181,725 ■
2009 2010 2011 2012 2013
■Unassigned ❑Assigned for Fire Fund ■Assigned for Other Purposes ❑Restricted ■No pendable
•
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
GENERAL FUND
Assigned for other purposes decreased significantly from 2010 and prior balances as the City is now
required to report its working capital with unassigned fund balance, as required by GASB Statement
No. 54.
General Fund
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$
2009
2010
2011
2012
2013
■ Total Revenues
$2,795,896
$2,607,125
$2,773,578
$2,645,201
$2,626,455
■ Total Expenditures
2,397,434
2,429229
2,519,310
2,676215
2,603,383
❑Fund Balance
1,659,565
1,664,875
1,714,818
1,705274
1,721231
During the year ended December 31, 2013, the City's General Fund revenues decreased $ 18,746, or
.7 %, from 2012, while expenditures decreased by $ 72,832, or 2.7 %. These changes in revenues and
expenditures will be discussed by source and function, respectively, on the following pages.
As discussed earlier, fund balance did increase $ 15,957 from 2012 to 2013. Fund balance has increased
$ 61,666 or 3.7% since 2009.
0
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
GENERAL FUND REVENUES
As discussed earlier, the City's revenue decreased $ 18,746 from 2012 to 2013. The most significant
decrease was in miscellaneous revenue of $ 96,770 primarily due to lower market returns on investments
and the receipt of proceeds from cashing in stock gifted from Principal Finance Group during 2012.
Licenses and permits revenues decreased $ 41,439; most of this decrease related to a decrease in
building permits due to decreased construction in 2013. Charges for services revenues decreased
$ 23,954 as a result of an insurance dividend received in 2012. These decreases were partially offset by
increases in taxes and intergovernmental revenues. Taxes increased $ 48,525 due to an increase in the
General Fund's portion of the levy of approximately $ 61,000. Intergovernmental revenues increased
$ 109,057, or 14.1 %, due to FEMA dollars received to purchase firefighter air packs and other
miscellaneous equipment as well as DEED money received for rebuilding homes.
10
2009
2010
2011
2012
2013
Taxes
$ 1,104,615
$ 1,189,690 $
1,193,326 $
1,104,008 $
1,152,533
Special Assessments
4,735
20,349
1,458
845
2,080
Franchise Fees
107,120
112,155
115,583
116,668
117,894
Licenses and Permits
186,058
79,330
141,035
138,631
97,192
Intergovernmental
982,565
795,232
801,027
775,313
884,370
Charges for Services
234,991
238,787
345,032
268,653
244,699
Fines and Forfeitures
68,059
74,210
69,592
62,065
45,439
Miscellaneous
107,753
97,372
106,525
179,018
82,248
Total Revenues
$ 2,795,896
$ 2,607,125 $
2,773,578 $
2,645,201 $
2,626,455
As discussed earlier, the City's revenue decreased $ 18,746 from 2012 to 2013. The most significant
decrease was in miscellaneous revenue of $ 96,770 primarily due to lower market returns on investments
and the receipt of proceeds from cashing in stock gifted from Principal Finance Group during 2012.
Licenses and permits revenues decreased $ 41,439; most of this decrease related to a decrease in
building permits due to decreased construction in 2013. Charges for services revenues decreased
$ 23,954 as a result of an insurance dividend received in 2012. These decreases were partially offset by
increases in taxes and intergovernmental revenues. Taxes increased $ 48,525 due to an increase in the
General Fund's portion of the levy of approximately $ 61,000. Intergovernmental revenues increased
$ 109,057, or 14.1 %, due to FEMA dollars received to purchase firefighter air packs and other
miscellaneous equipment as well as DEED money received for rebuilding homes.
10
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
GENERAL FUND REVENUES
Total revenues have been consistent since 2009, decreasing just 5.9% overall. The largest variances
between the types of revenue have been the increases in tax revenue offset by the decreases in licenses
and permits and intergovernmental revenue. As noted in the graph following, the City's tax rate had
remained consistent followed by increases in 2012 and 2013 due in large part to the decrease in the
taxable tax capacity.
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
Tax Capacity, Levy and Rates
97.00%
1
53.89
50.48
LEE] 48.47 % 48.47
2009 2010 2011 2012 2013
Taxable Tax Capacity —IN—Certified Tax Levy Tax Rate Collection Rate
100
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
The pie charts on the following page show the General Fund sources of revenue for 2013 and 2012 as a
percentage of total revenues. The allocation of sources of revenue fluctuates minimally from year -to-
year. Taxes account for the largest component of General Fund revenues, making up 44% of the total.
Intergovernmental revenue accounts for 33 %. The total of these two categories accounts for
approximately 77% of General Fund revenues in 2013, fairly consistent with 71% in 2012. The most
significant changes in allocation were in taxes, intergovernmental and miscellaneous revenues as
discussed earlier.
11
GENERAL FUND REVENUE
Special A
Special
Less
Taxes
44
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
2013 General Fund Revenues
Licenses and Permits
do/
3%
2012 General Fund Revenues
vernmental
33
:harges for Services
9%
3rfeitures
2%
7%
Charges for Services
10%
Forfeitures
12
GENERAL FUND REVENUES
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
■Budget
■Actual
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
General Fund Revenues Budget and Actual
The graph above illustrates revenue of the General Fund for 2013 compared to budgeted amounts by
source. Total revenues were over budget by $ 95,555 or 3.8 %.
Intergovernmental revenues were $ 116,035 over budget due to the City receiving FEMA dollars to
purchase firefighter air packs and other miscellaneous equipment as well as DEED money received for
rebuilding homes, these federal funds were not budgeted for.
13
Taxes
Special Assessments
ents
Franchise Fees
icenses and
pemilts
Intergovernm ental
Charges for
Services
Fines and
Forfeitures
Ivhscellaneous
$1,154,645
$1,500
$114,800
$90,605
$768,335
$230,775
$62,500
$107,740
1,152,533
2,080
117,894
97,192
884,370
244,699
45,439
82 ,248
The graph above illustrates revenue of the General Fund for 2013 compared to budgeted amounts by
source. Total revenues were over budget by $ 95,555 or 3.8 %.
Intergovernmental revenues were $ 116,035 over budget due to the City receiving FEMA dollars to
purchase firefighter air packs and other miscellaneous equipment as well as DEED money received for
rebuilding homes, these federal funds were not budgeted for.
13
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
GENERAL FUND EXPENDITURES
Total Expenditures $ 2,397,434 $ 2,429,229 $ 2,519,310 $ 2,676,215 $ 2,603,383
As discussed earlier, General Fund expenditures decreased $ 72,832, or 2.7 %, from 2012 to 2013. The
most significant decrease in expenditures occurred in capital outlay expenditures. Capital outlay
expenditures decreased by $ 150,7436, or 46.9 %, from 2012, due to the purchase of fire vehicles and
equipment including a pumper truck, rescue van, turn -out gear, and an ATV and related equipment
during 2012. Public works expenditures decreased $ 8,363 due to moving the street lighting activity to a
new fund during 2013.
Partially offsetting these decreases was an in public safety expenditures of $ 114,733, the largest
component of this increase related to adding a police officer during the year. General government and
culture and recreation expenditures were fairly consistent with the prior year, decreasing just $ 13,392
and $ 15,074, respectively.
The pie charts on the following page show the General Fund expenditures by function for 2013 and
2012 as a percentage of total expenditures. The allocation of expenditures by function was fairly
consistent from 2012 to 2013. Public safety remains the largest component of General Fund
expenditures, increasing from 48% to 54% during 2013. The most significant change between the two
years is capital outlay expenditures, which decreased from 12% to 7% of total expenditures due to the
purchase of a fire vehicle and fire equipment during 2012, as discussed earlier. This decrease resulted in
the increase of public safety expenditures as a percentage of total expenditures.
14
2009
2010
2011
2012
2013
General Government
$ 497,099
$ 525,070 $
492,861 $
499,170 $
485,778
Public Safety
1,266,332
1,262,682
1,277,072
1,290,614
1,405,347
Public Works
365,649
393,920
374,154
353,298
344,935
Culture and Recreation
195,602
197,938
202,065
211,578
196,504
Capital Outlay
72,752
49,619
173,158
321,555
170,819
Total Expenditures $ 2,397,434 $ 2,429,229 $ 2,519,310 $ 2,676,215 $ 2,603,383
As discussed earlier, General Fund expenditures decreased $ 72,832, or 2.7 %, from 2012 to 2013. The
most significant decrease in expenditures occurred in capital outlay expenditures. Capital outlay
expenditures decreased by $ 150,7436, or 46.9 %, from 2012, due to the purchase of fire vehicles and
equipment including a pumper truck, rescue van, turn -out gear, and an ATV and related equipment
during 2012. Public works expenditures decreased $ 8,363 due to moving the street lighting activity to a
new fund during 2013.
Partially offsetting these decreases was an in public safety expenditures of $ 114,733, the largest
component of this increase related to adding a police officer during the year. General government and
culture and recreation expenditures were fairly consistent with the prior year, decreasing just $ 13,392
and $ 15,074, respectively.
The pie charts on the following page show the General Fund expenditures by function for 2013 and
2012 as a percentage of total expenditures. The allocation of expenditures by function was fairly
consistent from 2012 to 2013. Public safety remains the largest component of General Fund
expenditures, increasing from 48% to 54% during 2013. The most significant change between the two
years is capital outlay expenditures, which decreased from 12% to 7% of total expenditures due to the
purchase of a fire vehicle and fire equipment during 2012, as discussed earlier. This decrease resulted in
the increase of public safety expenditures as a percentage of total expenditures.
14
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
GENERAL FUND EXPENDITURES
General
General
2013 General Fund Expenditures
Public Safety
54%
Public Works
13%
Culture and
Recreation
7%
Capital Outlay
7%
2012 General Fund Expenditures
Public Safety
19% Capital Outlay
12%
Works
o/a
15
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
GENERAL FUND EXPENDITURES
The chart below illustrates expenditures of the General Fund for 2013 compared to budgeted amounts by
function. Total expenditures exceeded the total budgeted expenditures by $ 76,143, or 3.0 %.
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000 -
■ Budget
❑ Actual
General Fund Expenditures Budget and Actual
The most significant variance in expenditures exceeding budgeted amounts was in the capital outlay
function. Actual expenditures exceeded the budget by $ 102,119 due to the purchase of the firefighter
air packs and miscellaneous equipment with the FEMA funds and are not included in the budget. This
variance was partially offset by general government expenditures coming in $ 34,292 under the
budgeted amount due to budgeting for health insurance benefits whether the employee elects to receive
them or not.
Public safety, public works and culture and recreation expenditures were consistent with budgeted
amounts.
16
I
I
:::a I
General Government
Public Safety
Public Works
Culture and Recreation
Capital Outlay
$520,070
$1,371,315
$352,970
$214,185
$68,700
485,778
1,405,347
344,935
196,504
170,819
The most significant variance in expenditures exceeding budgeted amounts was in the capital outlay
function. Actual expenditures exceeded the budget by $ 102,119 due to the purchase of the firefighter
air packs and miscellaneous equipment with the FEMA funds and are not included in the budget. This
variance was partially offset by general government expenditures coming in $ 34,292 under the
budgeted amount due to budgeting for health insurance benefits whether the employee elects to receive
them or not.
Public safety, public works and culture and recreation expenditures were consistent with budgeted
amounts.
16
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
ENTERPRISE FUNDS
Enterprise funds are used to account for operations financed and operated in a manner, similar to private
business enterprises, where the City intends the cost of providing goods or services to the public be
financed or recovered primarily through user charges. The City's Enterprise Funds include the Water,
Sanitary Sewer, Refuse, Storm Water and Street Light Utility Funds.
Water Fund
The Water Fund has shown operating losses for the last five years. Operating revenues increased
$ 86,776, or 13.9 %, from 2012 due to an increase in rates, while operating expenses decreased
$ 24,914, or 3.3 %, from 2012 to 2013, due to slight decreases in salaries and benefits, materials and
supplies and repairs and maintenance expenses.
Operations produced an operating loss; with the exclusion of $ 377,590 in depreciation expense, the
Fund experienced operating income of $ 357,300. However, depreciation should be considered as a true
expense in operations, being that most equipment and facilities will eventually need upgrades or
replacement. The operations of the Water Fund covered about 95% of depreciation expense.
In addition to the operating revenues and expenses of the Water Fund, there were net non - operating
expenses of $ 299,100, which is mainly due to interest expense paid on outstanding debt. The operating
and non - operating activities netted with transfers resulted in a increase in net position of $ 1,088 to
$ 7,224,810 at December 31, 2013.
Water Fund
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
$(200,000)
$(400,000)
$(600,000)
$(800,000)
2009
2010
2011
2012
2013
■ Operating Revenues
$428,631
$466,004
$502,359
$626,360
$713,136
❑ Operating Expenses
744,792
724,362
734,017
758,440
733,526
■ Operating Loss with Depreciation
(316,161)
(258,358)
(231,658)
(132,080)
(20,390)
❑ Oneratine Income without Depreciation
71.446
128.583
153.517
250.450
357.200
17
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
ENTERPRISE FUNDS
Sanitary Sewer Fund
Operating revenues increased $ 249,207, or 54.1 %, from 2012 to 2013, while operating expenses
increased $ 128,164, or 18.8 %. The increase in revenue is due to the City issuing a refund to the
College of St. Benedict (College) for overpayments of sewer usage from 2010; this refund of
approximately $ 78,000 was netted against revenue in 2012. In addition, the fund experienced an
increase in service charges due to an increase in rates.
The Sewer Fund has shown operating losses for each of the past five years. Due to the nature and cost
of the Sewer Fund's assets, it is difficult to establish sewer rates sufficient to cover replacement of the
assets represented by depreciation expense. Ideally, sewer revenues should cover all operating
expenses, including depreciation. However, depreciation of Sewer Fund assets is a difficult cost to
recover from system users since there are relatively few users in relation to the cost of asset replacement.
The operations of the Sewer Fund covered 74% of depreciation expense.
The graph below indicates the Sewer Fund did generate operating income in prior years when
depreciation expense is not considered (indicated by the teal bar), thereby covering a portion, but not all
of annual depreciation expense.
In addition to the operating revenues and expenses of the Sewer Fund, there were net non - operating
expenses of $ 189,762, which is mainly due to $ 143,925 of interest expense paid on outstanding debt.
Transfers along with the operating and non - operating activities resulted in a decrease in net position of
$ 286,370 to $ 7,323,742 at December 31, 2013.
Sanitary Sewer Fund
$1,000,000
$750,000
$500,000
$250,000
$-
$(250,000)
$(500,000) 2009 2010 2011 2012 2013
■ Operating Revenues $473,356 $624,308 $494,160 $460,685 $709,892
• Operating Expenses 651,748 808,840 682,708 681,214 809,378
• Operating Loss with Depreciation (178,392) (184,532) (188,548) (220,529) (99,486)
• Operating Income without Depreciation 29,291 21,538 66,234 42,217 289,213
OR
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
ENTERPRISE FUNDS
Refuse Fund
The following graph displays selected financial data for the Refuse Fund for the past five years. The
Fund consistently showed an operating loss each year. Operating expenses increased $ 19,968, or 6.7 %,
while operating revenues increased $ 3,125, or 1.1 %, from 2012 to 2013. These changes resulted in an
operating loss of $ 17,964 for 2013. The fund produced an operating loss of $ 11,458 when depreciation
is not factored in. The operations of the Refuse Fund do not cover any portion of the depreciation
expense. The increase in operating expenses is due to contracting out the compost site to a private
vendor. It should be noted that the Refuse Fund receives non - operating revenues including interest
income and special assessments revenue, which resulted in an increase in the Fund's net position of
$ 24,488.
Refuse Fund
$350,000
$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
$-
$(50,000)
2009
2010
2011
2012
2013
■ Operating Revenues
$284,231
$289,605
$298,909
$294,998
$298,123
■ Operating Expenses
293,981
304,316
305,660
296,119
316,087
■Operating Loss with Depreciation
(9,750)
(14,711)
(6,751)
(1,121)
(17,964)
■Operating Income (Loss) without Depreciation
(9,750)
(14,711)
(6,751)
(1,121)
(11,458)
19
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
ENTERPRISE FUNDS
Storm Water Fund
The Storm Water Fund showed operating losses in the past five years. Operations were consistent with
the prior year. Operating revenues increased just $ 673, or .7 %, from 2012 to 2013, while operating
expenses increased just $ 781, or .5 %.
The Storm Water Fund produced an operating loss of $ 68,280 with depreciation and operating income
of $ 28,946 without depreciation expense. The operations of the Storm Water Fund covered
approximately 30% of depreciation expense. The Storm Water Fund also reported non - operating
income including investment income and special assessments totaling $ 22,440, but also transferred
$ 18,250 for bonded improvement projects to other funds, which resulted in a decrease in net position of
$ 63,412.
We recommend the City continue to monitor rates as well as operating expenses to ensure the Fund's
profitability in the future.
Storm Water Fund
$280,000
$240,000
$200,000
$160,000
$120,000
$80,000
$40,000
$(40,000)
$(80,000)
2009
2010
2011
2012
2013
■OpemtingRevenues
$112,605
$99,294
$100,093
$101,336
$102,009
• Opemting Expenses
169,185
162,833
171,383
169,508
170,289
vOpemting Loss with Depreciation
(56,580)
(63,539)
(71,290)
(68,172)
(68,280)
■ Opemting Income without Depreciation
41,215
30,619
26,153
29,179
28,946
20
CITY OF ST. JOSEPH
FINANCIAL ANALYSIS
December 31, 2013
ENTERPRISE FUNDS
Street Light Utility
The Street Light Utility Fund was opened during 2013 to track activity relating to the street light utility.
The Fund showed a small operating loss for the year.
We recommend the City continue to monitor rates as well as operating expenses to ensure the Fund's
profitability in the future.
Street Light Utility
Pnn nnn
21