HomeMy WebLinkAbout2002 Audit Report
CITY OF ST. JOSEPH, MINNESOTA
Stearns County
AUDITED FINANCIAL STATEMENTS
As of December 31, 2002
CITY OF ST. JOSEPH, MINNESOTA
TABLE OF CONTENTS
ELECTED OFFICIALS AND ADMINISTRATION ...... ............................................... 1
INDEPENDENT AUDITORS' REPORT.......... .......... ..... ............. ......... ........................ 2
GENERAL PURPOSE FINANCIAL STATEMENTS -
Combined Balance Sheet - All Fund Types and Account Groups............................. 4
Combined Statement of Revenues, Expenditures and Changes in Fund Balance-
All Governmental Fund Types........ .................... ...... ........ ....................................... 5
Combined Statement of Revenues, Expenditures and Changes in Fund Balance-
Budget and Actual- General and Special Revenue Fund Types............................. 6
Combined Statement of Revenues, Expenses and Changes in Retained
Earnings - All Proprietary Fund Types .................................................................... 7
Combined Statement of Cash Flows - All Proprietary Fund Types .......................... 8
Notes to the Financial Statements................. ................... .......................................... 9
COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS -
General Fund -
Comparative Balance Sheets........ .......... ................ .............................................. 33
Statement of Revenues, Expenditures and Changes in Fund Balance-
Budget and Actua1........... ............... ................. ............ ....................................... 34
Special Revenue Fund -
Combining Balance Sheet......................... .......... ...... ........ ................................... 40
Combining Statement of Revenues, Expenditures and Changes in
Fund Balance.. ........ ....... ........... ............. ............ ................. ................ ............... 41
Debt Service Funds -
Combining Balance Sheet... ............. ........ ...... ..... ................ ...................... ........... 42
Combining Statement of Revenues, Expenditures and Changes in Fund
Balance........ .... .... ......................... ...... ................................................................ 43
Capital Project Funds -
Combining Balance Sheet......... ................ ........................................................... 46
Combining Statement of Revenues, Expenditures and Changes in Fund
Balance.............................................................................................................. . 47
Enterprise Funds -
Combining Balance Sheet............. .......... ........... ........ ...... ............ ...... ......... .... ..... 48
Combining Statement of Revenues, Expenses and Changes in Retained
Earnings......... ........ .................. ............. .................. ..... ...................................... 49
Combining Statement of Cash Flows .................................................................. 50
Statement of General Long-Term Debt ........................................ ............................. 51
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS .................................... 52
NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS ....... 53
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER
FINANCIAL REPORTING BASED ON AN AUDIT OF THE GENERAL
PURPOSE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE
WITH GO VERNMENT AUDITING STANDARDS... ....... .... ......................................... 54
CITY OF ST. JOSEPH, MINNESOTA
TABLE OF CONTENTS
(Continued)
INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH REQUIREMENTS
APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER
COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-I33.. ...................... 56
SCHEDULE OF FINDINGS AND QUESTIONED COSTS IN ACCORDANCE WITH
OMB CIRCULAR A-I33 .......................................... ...... ................................................ 58
AUDITORS' REPORT ON LEGAL COMPLIANCE .................................................... 60
FINDINGS AND CORRECTIVE ACTION PLANS ON COMPLIANCE WITH
MINNESOTA STATUTES AND INTERNAL CONTROLS ......................................... 61
CITY OF ST. JOSEPH, MINNESOTA
ELECTED OFFICIALS AND ADMINISTRATION
December 31,2002
Term
City Council Position Expires
Larry J. Hosch Mayor January 6, 2003
Cory Ehlert Councilmember January 6, 2003
Bob Loso Councilmember January 6, 2003
Kyle Schneider Councilmember January 6, 2005
Al Rassier Councilmember January 6, 2005
Administration
Judy Weyrens City Clerk!
Treasurer/
Administrator Appointed
1
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KERN· DEWENTER·YIERE
INDEPENDENT AUDITORS' REPORT
February 20,2003
Honorable Mayor and City Council
City of St. Joseph
St. Joseph, Minnesota
We have audited the accompanying general purpose financial statements of the City ofSt.
Joseph, Minnesota, as of and for the year ended December 31, 2002, as listed in the table of
contents. These general purpose financial statements are the responsibility of the City's
management. Our responsibility is to express an opinion on these general purpose 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 of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, the general purpose financial statements referred to above present fairly, in all
material respects, the financial position of the City of St. Joseph, Minnesota, as of December 31,
2002, and the results of its operations and the cash flows of its proprietary fund types, for the
year then ended in'conformity with accounting principles generally accepted in the United States
of America.
In accordance with Government Auditing Standards, we have also issued our report dated
February 20,2002 on our consideration of the City ofSt. Joseph's internal control over financial
reporting and our tests of its compliance with certain provisions of laws, regulations, contracts
and grants. This report is an integral part of a Government Auditing Standards audit, and in
considering the results of the audit, this report should be read along with the auditor's report on
the financial statements.
2
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KERN· DEWENT ER· VI E RE
Our audit was performed for the purpose of forming an opinion on the general purpose financial
statements of the City taken as a whole. The combining and individual fund financial statements
listed in the table of contents are presented for purposes of additional analysis and are not a
required part of the general purpose financial statements of the City of S1. Joseph, Minnesota.
Such information has been subjected to the auditing procedures applied in the audit ofthe
general purpose financial statements and, in our opinion, is fairly stated, in all material respects,
in relation to the general purpose financial statements taken as a whole.
¡(.fAil, ðeMJVù, VUú, ¿fd.
KERN, DEWENTER, VIERE, LTD.
81. Cloud, Minnesota
3
CITY OF ST. JOSEPH, MINNESOTA
COMBINED BALANCE SHEET -
ALL FUND TYPES AND ACCOUNT GROUPS
December 31, 2002
Governmental Fund Types
Special Debt Capital
ASSETS AND OTHER DEBITS General Revenue Service Projects
ASSETS:
Cash and Investments (Including Cash
Equivalents) $ 1,466,090 $ 96,637 $ 3,456,204 $ 1,072,195
Taxes Receivable -
Delinquent 4,037 0 3,852 0
Special Assessments Receivable -
Deferred 3,469 0 3,244,027 0
Delinquent 0 0 23,894 0
Accounts Receivable 42,226 0 77,101 0
Notes Receivable 10,000 0 0 0
Interest Receivable 7,949 437 43,289 1,570
Due from Other Governmental Units 98,068 0 88,059 57,964
Fixed Assets - Net 0 0 0 0
OTHER DEBITS:
Amount Available in Debt Service Funds 0 0 0 0
Amount to be Provided from Special
Assessments 0 0 0 0
Amount to be Provided for Compensated
Absences Payable 0 0 0 0
Amount to be Provided for Retirement of
General Long-Tenn Debt 0 0 0 0
TOTAL ASSETS AND OTHER DEBITS $ 1,631,839 $ 97,074 $ 6,936,426 $ 1,131,729
LIABILITIES, EQUITY AND OTHER CREDITS
LIABILITIES:
Cash Overdraft $ 0 $ 13,493 $ 34,464 $ 0
Accrued Liabilities 167,231 10,497 9,924 24,054
Contracts Payable 0 0 0 179,552
Deferred Revenue 7,506 0 3,271,773 0
Compensated Absences Payable 14,525 0 0 0
Bonds Payable 0 0 0 0
Loans Payable 0 0 0 0
Total Liabilities 189,262 23,990 3,316,161 203,606
EQUITY AND OTHER CREDITS:
Investment in General Fixed Assets 0 0 0 0
Contributed Capital 0 0 0 0
Retained Earnings (Deficit) 0 0 0 0
Fund Balance -
Reserved 10,000 0 3,620,265 0
Unreserved -
Designated 677,727 0 0 0
Undesignated 754,850 73,084 0 928,123
Total Equity and Other Credits 1,442,577 73,084 3,620,265 928,123
TOTAL LIABILITIES, EQUITY
AND OTHER CREDITS $ 1,631,839 $ 97,074 $ 6,936,426 $ 1,131,729
The notes to the financial statements are an integral part of this statement.
Proprietary
Fund Types Account Groups
General General Totals
Fixed Long-Tenn (Memorandum Only)
Enterprise Assets Debt 2002 2001
$ 1,133,728 $ 0 $ 0 $ 7,224,854 $ 5,095,203
0 0 0 7,889 7,102
0 0 0 3,247,496 1,752,457
0 0 0 23,894 3,299
131,449 0 0 250,776 329,788
0 0 0 10,000 20,000
9,647 0 0 62,892 106,263
0 0 0 244,091 266,519
8,195,743 4,146,673 0 12,342,416 9,019,091
0 0 3,620,265 3,620,265 2,494,904
0 0 3,267,921 3,267,921 1,602,431
0 0 58,005 58,005 54,584
0 0 5,042,974 5,042,974 3,465,749
$ 9,470,567 $ 4,146,673 $ 11,989,165 $ 35,403,473 $ 24,217,390
$ 0 $ 0 $ 0 $ 47,957 $ 62,896
43,498 0 0 255,204 276,437
0 0 0 179,552 0
0 0 0 3,279,279 1,762,858
35,404 0 58,005 107,934 102,235
0 0 11,735,000 11,735,000 7,340,000
0 0 196,160 196,160 223,084
78,902 0 11,989,165 15,801,086 9,767,510
0 4,146,673 0 4,146,673 3,540,296
9,570,807 0 0 9,570,807 6,683,167
(179,142) 0 0 (179,142) (206,535)
0 0 0 3,630,265 2,514,904
0 0 0 677,727 972,398
0 0 0 1,756,057 945,650
9,391,665 4,146,673 0 19,602,387 14,449,880
$ 9,470,567 $ 4,146,673 $ 11,989,165 $ 35,403,473 $ 24,217,390
4
CITY OF ST. JOSEPH, MINNESOTA
COMBINED STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - ALL GOVERNMENTAL FUND TYPES
Year Ended December 31, 2002
Governmental Fund Types
Special Debt
General Revenue Service
REVENUES:
General Property Taxes $ 257,694 $ 0 $ 241,588
Special Assessments 2,570 0 1,171,543
Licenses and Pennits 142,198 0 0
Intergovernmental 915,247 0 341,164
Charges for Services 174,986 0 0
Fines 56,299 0 0
Miscellaneous 171,886 95,192 289,328
Total Revenues 1,720,880 95,192 2,043,623
EXPENDITURES:
Current -
General Government 393,060 0 0
Public Safety 1,141,743 41,782 0
Public Works 285,279 0 0
Culture and Recreation 132,156 0 0
Economic Development 0 77,230 0
Miscellaneous 103,641 0 0
Capital Outlay 0 0 0
Debt Service 0 0 1,862,133
Total Expenditures 2,055,879 119,012 1,862,133
EXCESS OF REVENUES OVER (UNDER)
EXPENDITURES (334,999) (23,820) 181,490
OTHER FINANCING SOURCES (USES):
Operating Transfers In 0 52,222 35,309
Operating Transfers Out (87,531) 0 0
Sale of Surplus Property 165,592 0 0
Proceeds from the Sale of Bonds 0 0 908,492
Total Other Financing Sources (Uses) 78,061 52,222 943,801
EXCESS OF REVENUES AND OTHER
FINANCING SOURCES OVER EXPENDITURES
AND OTHER FINANCING USES (256,938) 28,402 1,125,291
FUND BALANCE - January 1 1,699,515 44,682 2,494,904
RESIDUAL EQUITY TRANSFER 0 0 70
FUND BALANCE - December 31 $ 1,442,577 $ 73,084 $ 3,620,265
The notes to the financial statements are an integral part of this statement.
Totals
Capital (Memorandum Only)
Projects 2002 2001
$ 0 $ 499,282 $ 658,119
0 1,174,113 923,880
0 142,198 90,366
75,091 1,331,502 744,210
45,318 220,304 194,081
0 56,299 80,512
17,241 573,647 400,572
137,650 3,997,345 3,091,740
0 393,060 298,701
0 1,183,525 721,188
0 285,279 337,298
0 132,156 156,382
0 77,230 48,866
0 103,641 222
4,139,459 4,139,459 1,721,820
0 1,862,133 729,149
4,139,459 8,176,483 4,013,626
(4,001,809) (4,179,138) (921,886)
0 87,531 297,000
0 (87,531) 0
0 165,592 69,471
4,736,151 5,644,643 1,436,398
4,736,151 5,810,235 1,802,869
734,342 1,631,097 880,983
193,851 4,432,952 3,551,969
(70) 0 0
$ 928,123 $ 6,064,049 $ 4,432,952
5
CITY OF ST. JOSEPH, MINNESOTA
COMBINED STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL -
GENERAL AND SPECIAL REVENUE FUND TYPES
Year Ended December 31, 2002
General Fund
Over
(Under)
Budget Actual Budget
REVENUES:
General Property Taxes $ 266,717 $ 257,694 $ (9,023)
Special Assessments 21,000 2,570 (18,430)
Licenses and Pennits 67,350 142,198 74,848
Intergovernmental 842,111 915,247 73,136
Charges for Services 166,505 174,986 8,481
Fines 77,100 56,299 (20,801)
Miscellaneous 70,500 171,886 101,386
Total Revenues 1,511,283 1,720,880 209,597
EXPENDITURES:
Current -
General Government 336,755 393,060 56,305
Public Safety 774,811 1,141,743 366,932
Public Works 291,850 285,279 (6,571)
Culture and Recreation 160,533 132,156 (28,377)
Economic Development 0 0 0
Miscellaneous 500 103,641 103,141
Total Expenditures 1,564,449 2,055,879 491,430
REVENUES OVER (UNDER) EXPENDITURES (53,166) (334,999) (281,833)
OTHER FINAl~CING SOURCES (USES):
Operating Transfers In 900 0 (900)
Operating Transfers Out 0 (87,531) (87,531)
Sale of Surplus Property 0 165,592 165,592
Total Other Financing Sources (Uses) 900 78,061 77,161
EXCESS OF REVENUES OVER (UNDER)
EXPENDITURES AND OTHER
FINANCING USES $ (52,266) (256,938) $ (204,672)
FUND BALANCE - January 1 1,699,515
FUND BALANCE - December 31 $ 1 ,442,577
The notes to the financial statements are an integral part of this statement.
Special Revenue Funds
Over
(Under)
Budget Actual Budget
$ 33,280 $ 0 $ (33,280)
0 0 0
0 0 0
0 0 0
0 0 0
0 0 0
0 95,192 95,192
33,280 95,192 61,912
0 0 0
0 41,782 41,782
0 0 0
0 0 0
35,130 77,230 42,100
0 0 0
35,130 119,012 83,882
(1,850) (23,820) (21,970)
0 0 0
0 52,222 52,222
0 0 0
0 52,222 52,222
$ (1,850) . 28,402 $ 30,252
44,682
$ 73,084
6
CITY OF ST. JOSEPH, MINNESOTA
COMBINED STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN RETAINED EARNINGS - ALL PROPRlETARY FUND TYPES
Year Ended December 31, 2002
With Comparative Totals for the Year Ended December 31,2001
Totals
2002 2001
OPERATING REVENUES:
Charges for Services $ 646,185 $ 656,677
OPERATING EXPENSES:
Salaries and Benefits 180,619 136,203
Utilities 28,841 28,748
Supplies 16,546 14,638
Sewer Use Rental 125,374 123,898
Postage 1,521 1,890
Repairs and Maintenance 31,301 32,649
Professional Fees 0 765
Fees and Tests 10,065 12,535
Dues and Subscriptions 626 610
Refuse Disposal 109,544 96,745
Depreciation 164,346 142,395
Insurance 10,800 8,734
Miscellaneous 4,639 5,292
Total Operating Expenses 684,222 605,102
OPERATING INCOME (LOSS) (38,037) 51,575
NON-OPERATING REVENUES (EXPENSES):
Investment Income 56,722 60,011
Other Revenues 16,615 19,891
Loss on Disposal of Fixed Assets (7,907) 0
Total Non-Operating Revenues (Expenses) 65,430 79,902
INCOME BEFORE OPERATING TRANSFERS 27,393 131,477
Operating Transfers Out 0 (297,000)
NET INCOME (LOSS) 27,393 (165,523)
RETAINED EARNINGS (DEFICIT) - January I (206,535) (41,012)
RETAINED EARNINGS (DEFICIT) - December 31 $ (179,142) $ (206,535)
The notes to the financial statements are an integral part of this statement.
7
CITY OF ST. JOSEPH, MINNESOTA
COMBINED STATEMENT OF CASH FLOWS -
ALL PROPRIETARY FUND TYPES
Year Ended December 31, 2002
With Comparative Totals for the Year Ended December 31, 2001
Totals
2002 2001
CASH FLOWS FROM OPERATING ACTIVITIES:
Operating Income (Loss) $ (38,037) $ 51,575
Adjustments to Reconcile Operating Income (Loss)
to Net Cash Provided by Operating Activities:
Depreciation 164,346 142,395
Other Non-operating Revenues 16,615 19,891
Change in Assets and Liabilities:
Accounts Receivable 47,360 (1,119)
Accrued Liabilities (14,047) 16,725
Due to Other Governmental Units ° (17,117)
Compensated Absences Payable 3,469 3,720
Total Adjustments 217,743 164,495
Net Cash Provided by Operating Activities 179,706 216,070
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Operating Transfers to Other Funds 0 (297,000)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING
ACTIVITIES:
Capital Acquisitions (1,560) (9,295)
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment Income 66,902 60,791
Net Increase (Decrease) in Cash and Cash Equivalents 245,048 (29,434)
Cash and Cash Equivalents, January 1 888,680 918,114
Cash and Cash Equivalents, December 31 $ 1,133,728 $ 888,680
The notes to the financial statements are an integral part of this statement.
8
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE I - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of St. Joseph, Minnesota, has a mayor-council form of government. A mayor and four
council members are elected by the voters of the City for two-year and four-year terms,
respectively.
The accounting policies of the City conform to accounting principles generally accepted in the
United States of America as applicable to governments. With respect" to proprietary activities,
the City has adopted GASB No. 20, "Accounting and Financial Reporting for Proprietary Funds
and Other Governmental Entities that use Proprietary Fund Accounting". The City has elected to
apply all applicable GASB pronouncements as well as Financial Accounting Standards Board
(F ASB) pronouncements, Accounting Principles Board (APB) Opinions and Accounting
Research Bulletins (ARB), issued on or before November 30, 1989 unless those pronouncements
conflict with or contradict GASB pronouncements. In addition, the City has elected not to apply
F ASBs, APBs and ARBs issued after November 30, 1989. The following is a summary of the
City's more significant accounting policies.
A. Financial Reporting Entity
The financial statements present the City and its component units. The City includes all
funds, account groups, organizations, institutions, agencies, departments and offices that are
not legally separate from such. Component units are legally separate organizations for which
the elected officials of the City are financially accountable and are included within the
financial statements of the City because of the significance of their operational or financial
relationships with the City.
The City is considered financially accountable for a component unit ifit appoints a voting
majority of the organization's governing body and it is able to impose its will on the
organization by significantly influencing the programs, projects, activities, or level of
services performed or provided by the organization, or there is a potential for the
organization to provide specific financial benefits to, or impose specific financial burdens on,
the City.
As a result of applying the component unit definition criteria above, the City of St. Joseph's
component unit is presented in this report as follows:
Blended Component Unit - The St. Joseph Economic Development Authority (ED A) was
organized for the purpose of preserving and creating jobs, enhancing the tax base, and
promoting the general welfare of the people of the City of St. Joseph. The Authority is
governed by a five member board appointed by the City Council. The EDA is included as a
blended component unit of the City because the EDA is financially accountable to the City,
and the Authority provides services almost entirely for the City. The St. Joseph EDA is
presented as a special revenue fund, the City Hall Project Capital Project Fund and the EDA
Public Project Revenue Bonds of2000 Debt Service fund. Separate financial statements ate
not prepared for the EDA.
9
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
B. Fund Accounting
The accounts of the City are organized on the basis offunds and account groups, each of
which is considered a separate accounting entity. The operations of each fund are accounted
for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund
! equity, revenues and expenditures or expenses, as appropriate. Government resources are
allocated to and accounted for in individual funds based upon the purposes for which they are
to be spent and the means by which expending activities are controlled. The various funds
are grouped, in the financial statements in this report, into five generic fund types and two
broad fund categories, described below.
Governmental Funds
The General Fund is the general operating fund ofthe City. It is used to account for all
financial resources except those required to be accounted for in another fund.
Special Revenue Funds are used to account for the proceeds of specific revenue sources
(other than expendable trusts or major capital projects) that are legally restricted to
expenditures for specified purposes.
Debt Service Funds are used to account for the accumulation of resources for, and the
payment of, general long-term debt principal, interest, and related costs.
Capital Projects Funds are used to account for financial resources to be used for the
acquisition or construction of major capital facilities (other than those financed by
enterprise funds).
Proprietary Funds
Enterprise Funds are used to account for operations (a) that are financed and operated in a
manner similar to private business enterprises--where the intent of the governing body is
that the costs (expenses, including depreciation) of providing goods or services to the
general public on a continuing basis be financed or recovered through user charges; or
(b) where the governing body has decided that periodic determination of revenues earned,
expenses incurred, or net income is appropriate for capital maintenance, public policy,
management control, accountability, or other purposes. The City maintains Refuse,
Water and Sewer Enterprise Funds.
10
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
C. Measurement Focus, Fixed Assets and Long-Term Liabilities
The accounting and reporting treatment applied to the fixed assets and long-term liabilities
associated with a fund are determined by its measurement focus. All governmental funds are
accounted for on a spending or "financial flow" measurement focus. This means that only
current assets and current liabilities are generally included on their balance sheets. Their
reported fund balance (net current assets) is considered a measure of "available spendable
resources". Governmental fund operating statements present increases (revenues and other
financing sources) and decreases (expenditures and other financing uses) in net current
assets. Accordingly, they are said to present a summary of sources and uses of available
spendable resources during a period.
Fixed assets used in governmental fund type operations (general fixed assets) are accounted
for in the General Fixed Assets Account Group, rather than in governmental funds. Public
domain ("infrastructure") general fixed assets consisting of certain improvements other than
buildings, including roads, curbs and gutters, streets and sidewalks, are not capitalized by the
City. No depreciation has been provided on general fixed assets.
All fixed assets are valued at their historical cost or estimated historical cost if actual
historical cost is not available. Donated fixed assets are valued at their estimated fair value
on the date donated.
Because of their spending measurement focus, expenditure recognition for governmental
fund types is limited to exclude amounts represented by noncurrent liabilities. Since they do
not affect net current assets, such long-term amounts are not recognized as governmental
fund type expenditures or fund liabilities. They are instead reported as liabilities in the
General Long-Term Debt Account Group.
The two account groups, General Fixed Assets and General Long-Term Debt, are not
"funds". They are concerned only with the measurement of financial position. They are not
involved with measurement of results of operations.
All proprietary funds are accounted for on a flow of economic resources measurement focus.
This means that all assets and all liabilities (whether current or noncurrent) associated with
the funds' activity are included on their balance sheets. Proprietary fund type operating
statements present increases (revenues) and decreases (expenses) in net total assets.
11
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
C. Measurement Focus, Fixed Assets and Long-Term Liabilities (Continued)
Major outlays for capital assets and improvements are capitalized in proprietary funds as
projects are constructed. Interest incurred during the construction phase of proprietary fund
fixed assets is reflected in the capitalized value of the asset constructed. Capital assets
constructed in governmental funds for proprietary funds are recorded as contributed capital.
Depreciation of all exhaustible fixed assets used by proprietary funds is charged as an
expense against their operations. Accumulated depreciation is reported on proprietary fund
balance sheets. Depreciation has been provided over the assets' estimated useful Jives, which
range from five to fifty years, using the straight-line method. Depreciation expense for the
years ended December 31,2002 and 2001 is $ 164,346 and $ 142,395, respectively.
D. Basis of Accounting
Basis of accounting refers to when revenues and expenditures or expenses are recognized in
the accounts and reported in the financial statements. Basis of accounting relates to the
timing of the measurement made, regardless ofthe measurement focus applied.
All governmental funds are accounted for using the modified accrual basis of accounting, in
which revenues are recognized when they become measurable and available as net current
assets.
The more significant revenues which have been accrued are intergovernmental revenues and
interest earnings.
Expenditures are generally recognized in the modified accrual basis of accounting when the
related fund liability is incurred. Exceptions to this general rule include sick pay and
principal and interest on general long-term debt, which are recognized when due.
All proprietary funds are accounted for using the accrual basis of accounting; revenues are
recognized when they are earned and expenses are recognized when they are incurred.
E. Budgetary Data
The City Council adopts an annual budget. The amounts shown in the financial statements as
"budget" represent the original budgeted amount and all revisions made during the year. The
City follows these procedures in establishing the budgetary data reflected in the financial
statements.
12
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
E. Budgetary Data (Continued)
1. In August of each year, the City Administrator submits to the City Council a proposed
operating budget for the fiscal year commencing the following January 1. The operating
budget includes proposed expenditures and the means of financing them for the
upcomIng year.
2. Public hearings are conducted to obtain taxpayer comment.
3. Prior to December 31, the budget is legally enacted through passage of a resolution.
4. Formal budgetary integration is employed as a management control device during the
year for the General and Special Revenue Funds. Formal budgetary integration is not
employed for Debt Service Funds because effective budgetary control is alternatively
achieved through general obligation bond indenture provisions. Budgetary control for
Capital Projects Funds is accomplished through the use ofproject controls.
5. The Budgets for the General and Special Revenue Funds are adopted on a basis
consistent with accounting principles generally accepted in the United States of America.
F. Encumbrances
Encumbrances represent outstanding purchase orders and unfulfilled commitments that are
issued to outside vendors and budgeted in the current year but do not include amounts that
are set up as liabilities, amounts for personal services to be performed by City employees and
purchase orders applicable to the subsequent year's budget.
As of December 31, 2002, no outstanding encumbrances existed.
G. Cash and Investments (Including Cash Equivalents) (See Note 3)
Cash balances from all funds are combined and invested to the extent available in authorized
investments. Earnings from such investments are allocated to the respective funds on the
basis of applicable cash balance participation by each fund. Investments are carried at fair
value.
For purposes of the statement of cash flows, the City considers all short-term, highly liquid
investments with original maturity dates of three months or less from the date of purchase to
be cash equivalents. In addition, cash invested in the City's cash management pool is
considered to be cash equivalents. Based on this policy, the total cash and investments of the
proprietary funds are considered to be cash equivalents.
13
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
H. Taxes Receivable
Delinquent taxes receivable represent the past six years of uncollected tax levies.
1. Special Assessments Receivable
Delinquent special assessments represent the past six years of uncollected special
assessments.
Deferred special assessments represent the principal portion of those assessments to property
owners for improvements made by the City. These assessments are made at various times by
City resolution and are collectible over periods ranging rrom ten to thirty years and bear
annual interest of 7 percent to 8 percent and are to be received in 2003 and years thereafter.
J. Deferred Revenue
Deferred revenue represents delinquent taxes and deferred and delinquent assessments
receivable. This revenue is deferred until it is measurable and available as net current assets.
K. Compensated Absences
The City compensates employees who leave City service in good standing for all earned,
unused vacation. In addition, employees are compensated for unused sick leave (up to a
maximum of720 hours) at 50% of the current regular rate of pay, provided the City's notice
of termination policy has been complied with.
L. Fund Equity
Fund equity is divided into sections as follows:
- Contributed capital represents fixed assets purchased by other funds and contributed to
the enterprise funds.
- Investment in General Fixed Assets represents the City's equity in general fixed assets.
- Retained earnings of enterprise funds are available for expending in future periods.
14
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
L. Fund Equity (Continued)
- Fund balance accounts are subdivided as follows:
Reserved accounts indicate the portion of fund balance which has been reserved for a
specific purpose.
Unreserved, designated accounts indicate the portion of fund balance which has been
designated for a specific purpose.
The unreserved, undesignated account is the portion of fund balance which is
available for budgeting and expending in future periods.
M. Revenues, Expenditures and Expenses
1. Revenues
Property taxes and special assessment principal and interest are recognized as revenue
when measurable and available. Portions of taxes paid by the State in the form of HAC A
and other tax credits are included in intergovernmental revenue. Intergovernmental
revenues are reported under the legal and contractual requirements of the individual
programs.
Licenses and permits, charges for services, fines and forfeits, and miscellaneous revenues
(except investment earnings) are recorded as revenues when received in cash because
they are generally not measurable until then. Investment earnings are recorded when
earned because they are measurable and available.
2. Property Tax Collection Calendar
The City levies its property tax for the subsequent year during the month of December.
December 28 is the last day the City can certify a tax levy to the County Auditor for
collection the following year. The property tax is recorded as revenue when it becomes
measurable and available. Steams County is the collecting agency for the levy and remits
the collections to the City three times a year. Taxes not collected as of December 31 each
year are shown as delinquent taxes receivable.
15
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
M. Revenues, Expenditures and Expenses (Continued)
2. Property Tax Collection Calendar (Continued)
The County Auditor creates the tax list for all taxable property in the City, applying the
applicable tax rate to the tax capacity of individual properties, to arrive at the actual tax
for each property. The County Auditor also collects all special assessments, except for
certain prepayments paid directly to the City. The County Auditor turns over the list of
taxes and special assessments to be collected on each parcel of property to the County
Treasurer in January of each year.
The County Treasurer collects all taxes, and all special assessments, except as noted
above. The County Treasurer is required to mail copies of all personal property tax
statements by April 15, and copies of all real estate tax statements by April 15, of each
year.
Property owners are required to pay one-half of their real estate taxes due by May 15 and
the balance by October 15. If taxes due May 15 are not paid on time, a penalty of3% is
assessed on homesteaded property, and 7% on non-homesteaded property. An additional
1 % penalty is added each month the taxes remain unpaid, until October 15. If the taxes
due May 15 are not paid by October 15, a 2% penalty per month is added to homesteaded
property and 4% per month to non-homesteaded property until January 1.
Ifthe taxes are not paid by January 1, further penalties are added. Penalties and interest
apply to both taxes and special assessments. There are some exceptions to the above
penalties, but they are not material.
Within 30 days after the tax settlement date, the County Treasurer is required to pay 70%
of the estimated collections of taxes and special assessments to the City Treasurer. The
County Treasurer must pay the balance to the City Treasurer within 60 days after
settlement, provided that after 45 days interest accrues.
3. Expenditures
Expenditure recognition for governmental fund types includes only amounts represented
by current liabilities. Since noncurrent liabilities do not affect net current assets, they are
not recognized as governmental fund expenditures or fund liabilities. They are reported
as liabilities in the General Long-Term Debt Account Group.
4. Expenses
Enterprise funds recognize expenses when they are incurred.
16
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
N. Interfund Transactions
Quasi-external transactions are accounted for as revenues, expenditures or expenses.
Transactions that constitute reimbursements to a fund for expenditures or expenses initially
made from it that are properly applicable to another fund are recorded as expenditures or
expenses in the fund that is reimbursed.
All other inter fund transactions, except quasi-external and reimbursements, are reported as
transfers. Nomecuning or nomoutine permanent transfers of equity are reported as residual
equity transfers. All other interfund transfers are reported as operating transfers.
O. Total Columns on General Purpose Statements
Total columns on the general purpose financial statements are captioned "memorandum
only" to indicate that they are presented only to facilitate financial analysis. Data in these
columns do not present financial position, results of operations, or cash flows in conformity
with accounting principles generally accepted in the United States of America. Interfund
eliminations have not been made in the aggregation of these data.
P. Comparative Data
Comparative total data for the prior year have been presented in the accompanying financial
statements in order to provide an understanding of changes in the City's financial position
and operations. However, prior year totals by fund type have not been presented in each of
the statements since their inclusion would make the statements unduly complex and difficult
to read.
Comparative data have been restated to reflect reclassifications.
Q. Use of Estiffiates
The preparation of general purpose 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.
17
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31,2002
NOTE 2 - STEWARDSHIP, COMPLIANCE AND ACCOUNT ABILITY
A. Fund Deficits
The following funds have deficit fund balance/retained earnings at December 31, 2002:
Debt Service Fund -
General Obligation Sewer Revenue Bonds of200l $ (32,666)
Enterprise Fund -
Sewer (575,951)
These deficits will be eliminated by future revenues, user charges or transfers from other
funds.
B. Expenditures in Excess of Appropriations
Expenditures exceeded appropriations in the following funds for the year ended
December 31,2002:
Expenditures Appropriation
General Fund $ 2,055,879 $ 1,564,449
Special Revenue Funds:
TIF #1-3 Borgert 30,445 0
TIF #1-4 S1. Joseph Development 12,200 0
DARE Program 250 0
City Beautification 41,532 0
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS
A. Assets
1. Cash and Investments (Including Cash Equivalents)
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
ofthis pool (or pools) is displayed on the financial statements as "cash and investments
(including cash equivalents)". For purposes of identifying risk of investing public funds,
the balances and related restrictions are summarized below:
a. Deposits - Minnesota Statutes require that all deposits with financial institutions must
be collateralized in an amount equal to 110% of deposits in excess of Federal
Depository Insurance Corporation (FDIC) insurance.
18
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
A. Assets (Continued)
1. Cash and Investments (Including Cash Equivalents) (Continued)
a. Deposits - (Continued)
Category 1 - Deposits covered by FDIC and those deposits collateralized with
securities held by the City or by its agent in the City's name.
Category 2 - Collateralized with securities held by the pledging institutions trust
department or agent in the District's name.
Category 3 - Deposits which are not insured or collateralized; or those deposits where
collateral assignment has not been perfected.
Category Bank Carrying
1 2 3 Balance Amount
-
Bank Accounts $ 2,232,029 $0 $ 653,594 $ 2,885,623 $ 2,007,796
Certificates of Deposit 2,267,882 0 0 2,267,882 2,267,882
-
Total Deposits $ 4,499,911 $0 $ 653,594 $ 5,153,505 $ 4,275,678
b. Investments - Minnesota Statutes authorize the City to invest in obligations of the
U.S. Treasury, agencies, and instrumentalities, shares of investment companies whose
only investments are in the 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. Investments held by the City at year end
classified as to credit risk are as follo\'.'s:
Category 1 - Insured or registered, or securities held by the City's agent in the City's
name.
Category 2 - Uninsured and unregistered, with securities held by the counterparty's
trust department or agent in the City's name.
Category 3 - Uninsured and unregistered, with securities held by the counterparty or
by its trust department or agent but not in the City's name.
19
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
A. Assets (Continued)
1. Cash and Investments (Including Cash Equivalents) (Continued)
b. Investments - (Continued)
Category Carrying and
1 2 3 Fair Value
U.S. Government and
Federal Agency Notes
and Bonds $ 657,707 $ 0 $ 0 $ 657,706
Negotiable Certificates
of Deposit 1,338,819 0 0 1,338,819
Repurchase Agreements 798,087 0 0 798,087
Total Investments $ 1,996,526 $ 0 $ 0 2,794,612
Unclassified as to Risk:
Money Market Mutual Funds 106,287
Total Deposits (See
Note 3 A.1.a.) 4,275,678
Petty Cash 320
Total Cash and Investments
(Including Cash Equivalents) $ 7,176,897
Cash and investment balances are presented in the general purpose financial
statements as follows:
Cash and Cash Investments (Including Cash Equivalents) $ 7,224,854
Cash Overdraft (47,957)
Total $ 7,176,897
20
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 3 - DETAlLED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
A. Assets (Continued)
2. Due from Other Governmental Units
The following is a summary of due from other governmental units at December 31,2002:
St. Wendel St. Joseph Steams State of Federal
Township TO\\11ship County MN Government Total
General Fund -
Fines $ 0 $ 0 $ 0 $ 4,624 $ 0 $ 4,624
Property Taxes/Special Assessments 0 0 85,792 0 0 85,792
Miscellaneous 2,312 1,664 0 3,676 0 7,652
Total General Fund 2,312 1,664 85,792 8,300 0 98,068
Debt Service Funds -
G.O. Improvement Bonds of
1993 - Property Taxes/Special
Assessments 0 0 5,029 0 0 5,029
G.O. Improvement Bonds of
1996 - Property Taxes/Special
Assessments 0 0 10,773 0 0 10,773
G.O. Improvement Bonds of
1998 - Property Taxes/Special
Assessments 0 0 4,433 0 0 4,433
G.O. Improvement Bonds of
1999 - Property Taxes/Special
Assessments 0 0 12,118 0 0 12,118
G.O. Bonds of2001 - Property
Taxes/Special Assessments 0 0 53,327 0 0 53,327
G.O. Sewer Revenue Bonds of
2001 - Special Assessments 0 0 2,379 0 0 2,379
Total Debt Service 0 0 72,257 0 0 88,059
Capital Projects Funds -
2002 Street Improvements
Federal Grant 0 0 0 0 57,964 57,964
Total $ 2,312 $ 1,664 $ 158,049 $ 8,300 $ 57,964 $ 244,091
21
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
A. Assets (Continued)
3. Fixed Assets
A summary of changes in general fixed assets follows:
Balance Balance
1-1-02 Additions Disposals 12-31-02
Land $ 157,544 $ 0 $ 32,089 $ 125,455
Buildings 1,630,758 3,375 0 1,634,133
Improvements Other
than Buildings 386,463 52,359 0 438,822
Machinery and Equipment 732,303 585,344 25,411 1,292,236
Office Furniture 108,097 26,716 0 134,813
Motor Vehicles 246,717 25,374 50,726 221,365
Other Equipment 278,414 21,434 0 299,848
Total $ 3,540,296 $ 714,602 $ 108,226 $ 4,146,672
A summary of Enterprise Fund fixed assets at December 31,2002, is as follows:
Water Sewer
Fund Fund Total
Land and Land Improvements $ 12,996 $ 4,941 $ 17,937
Treatment Plant and Lines 3,340,767 4,702,757 8,043,524
Buildings 0 517,983 517,983
Water Storage Facility 1,236,542 0 1,236,542
Machinery and Equipment 91,464 179,918 271,382
Total Cost 4,681,769 5,405,599 10,087,368
Less: Accumulated Depreciation 633,011 1,258,614 1,891,625
Net Fixed Assets $ 4,048,758 $ 4,146,985 $ 8,195,743
22
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 3 - DET AlLED NOTES ON ALL Fill-·ms AND ACCOUNT GROUPS (Continued)
B. Liabilities
1. Defined Benefit Pension Plans - Statewide
A. Plan Description
All full-time and certain part-time employees of the City ofSt. Joseph are covered by
defined benefit plans administered by the Public Employees Retirement Association
of Minnesota (PERA). PERA administers the Public Employees Retirement Fund
(PERF) and the Public Employees Police and Fire Fund (PEPFF) which are cost-
sharing, multiple-employer retirement plans. These plans are established and
administered in accordance with Minnesota Statutes, Chapters 353 and 356.
PERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated
Plan members are covered by Social Security and Basic Plan members are not. All
new members must participate in the Coordinated Plan. All police officers, fire-
fighters and peace officers who qualify for membership by statute are covered by the
PEPFF.
PERA provides retirement benefits as well as disability benefits to members, and
benefits to survivors upon death of eligible members. Benefits are established by
State Statute, and vest after three years of credited service. The defined retirement
benefits are based on a member's highest average salary for any five successive years
of allowable service, age, and years of credit at tennination of service.
Two methods are used to compute benefits for PERF's Coordinated and Basic Plan
members. The retiring member receives the higher of a step-rate benefit accrual
formula (Method 1) or a level accrual fonnula (Method 2). Under Method 1, the
annuity accrual rate for a Basic Plan member is 2.2 percent of average salary for each
of the first 10 years of service and 2.7 percent for each remaining year. The annuity
accrual rate for a Coordinated Plan member is 1.2 percent of average salary for each
of the first 10 years and 1.7 percent for each remaining year. Under Method 2, the
annuity accrual rate is 2.7 percent of average salary for Basic Plan members and 1.7
percent for Coordinated Plan members for each year of service. For PEPFF
members, the annuity accrual rate is 3.0 percent for each year of service. For all
PEPFF members and for PERF 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. Nonnal retirement age is 55 for PEPFF members and 65 for Basic and
Coordinated members hired prior to July 1, 1989. Nonnal retirement age for
unreduced social security benefits capped at 66 for Coordinated members hired on or
after July 1, 1989. A reduce retirement annuity is also available to eligible members
seeking early retirement.
23
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31,2002
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
B. Liabilities (Continued)
1. Defined Benefit Pension Plans - Statewide (Continued)
A. Plan Description (Continued)
There are different types of annuities available to members upon retirement. A
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 receiving them yet are bound by the provisions in
effect at the time they last terminated their public service.
PERA issues a publicly available financial report that includes financial statements
and required supplementary information for PERF and PEPFF. That report may be
obtained online at mnpera.com or by writing to PERA, 60 Empire Drive #200, St.
Paul, Minnesota, 55103-2088 or by calling (651) 296-7460 or 1-800-652-9026.
B. Funding Policy
Minnesota Statutes Chapter 353 sets the rates for employer and employee
contributions. These statutes are established and amended by the state legislature.
The City makes annual contributions to the pension plans equal to the amount
required by state statutes. PERF Basic Plan members and Coordinated Plan members
are required to contribute 9.10 percent and 5.10 percent, respectively, of their annual
covered salary. PEPFF members are required to contribute 6.20 percent of their
annual covered salary. The City ofSt. Joseph is required to contribute the following
percentages of annual covered payroll: 11.78 percent for Basic Plan PERF members,
5.53 percent for Coordinated Plan PERF members, and 9.30 percent for PEPFF
members. Member and employer contribution rates for Basic and Coordinated
members will increase by 0.35 percent effective January 2002. The City's
contributions to the Public Employees Retirement Fund for the years ending
December 31, 2002, 2001 and 2000 were $ 20,462, $ 17,465 and $ 17,887,
respectively. The City's contributions to the Public Employees Police and Fire Fund
for the years ending December 31,2002,2001, and 2000 were $ 26,783, $ 25,979 and
$ 23,975, respectively. The City's contributions Were equal to the contractually
required contributions for each year as set by state statute.
24
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
B. Liabilities (Continued)
2. Defined Contribution - Statewide
The City provides pension benefits for its elected local government officials through a
defined contribution plan administered by the Public Employees Retirement Association
(PERA). The Public Employees Defined Contribution Plan (PEDCP) is a multi-employer
deferred compensation plan. Elected officials who are covered by a public or private
pension plan because of their employment are not eligible to participate in the PEDCP.
Plan benefits depend solely on amounts contributed to the plan plus investment earnings.
"~1innesota Statutes, Chapter 353D.03 requires that both the elected local government
official and the City contribute an amount equal to 5% of the elected local government
official's salary. There is no vesting period required to receive benefits in the PEDCP.
The City's total payroll in the year 2002 was $ 774,062. The City's contributions were
calculated using the base salary amount of $ 20,800. Both the City and the elected local
government official made the required 5% contribution, amounting to $ 1,040 ftom each
source, or $ 2,080 in total.
3. Deferred Revenue
Deferred revenue at December 31, 2002, consisted of:
Debt
General Service Total
Taxes Receivable -
Delinquent $ 4,037 $ 3,852 $ 7,889
Special Assessments Receivable -
Deferred 3,469 3,244,027 3,247,496
Delinquent 0 23,894 23,894
Total $ 7,506 $ 3,271,773 $ 3,279,279
25
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
B. Liabilities (Continued)
4. Bonds Payable
The following is a summary of bond transactions for the year ended December 31, 2002:
General
Obligation General
General Special Obligation
Obligation Assessment Revenue Revenue Total
Bonds Payable -
January 1, 2002 $ 1,085,000 $ 3,835,000 $ 1,500,000 $ 920,000 $ 7,340,000
Bonds Issued 245,000 4,700,000 810,000 0 5,755,000
Bonds Retired (45,000) (385,000) (885,000) (45,000) (1,360,000)
Bonds Payable -
December 31, 2002 $ 1,285,000 $ 8,150,000 $ 1,425,000 $ 875,000 $ 11,735,000
Bonds outstanding at December 31, 2002, comprise the following issues:
General Obligation Bonds:
$ 1,235,000 General Obligation Bonds of 1997
due in annual installments of $ 35,000 to $ 100,000
through December 1,2017, interest at 4.00 to 5.75
percent $ 1,040,000
$ 245,000 General Obligation Equipment
Certificates of Indebtedness of2002 due in
annual installments of$ 60,000 to $ 65,000 through
December 1, 2006, interest at 2.75 to 4.20 percent 245,000
Total General Obligation Bonds 1,285,000
General Obligation Special Assessment Bonds:
$ 200,000 General Obligation Improvement Bonds of
1992 due in annual installments of$ 10,000 to $ 20,000
through December 1,2007, interest at 4.60 to 6.40 percent 90,000
26
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
(Continued)
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
B. Liabilities (Continued)
4. Bonds Payable (Continued)
General Obligation Special Assessment Bonds: (Continued)
$ 550,000 General Obligation Improvement Bonds of 1993
due in annual installments of $ 25,000 to $ 50,000 through
December 1, 2008, interest at 3.00 to 5.30 percent $ 265,000
$ 1,280,000 General Obligation Improvement Bonds of 1996
due in annual installments of$ 60,000 to $ 120,000 through
December 1, 2011, interest at 4.30 to 5.90 percent 875,000
$ 545,000 General Obligation Improvement Bonds of 1998
due in annual installments of $ 25,000 to $ 50,000 through
December 1, 2013, interest at 3.85 to 5.00 percent 440,000
$ 1,330,000 General Obligation Improvement Bonds of 1999
due in annual installments of $ 65,000 to $ 125,000 through
December 1,2014, interest at 4.875 to 5.20 percent 1,130,000
$ 810,000 General Obligation Improvement Bonds of 2001
due in annual installments of $ 160,000 to $ 165,000
through December 1,2006, interest at 3.00 to 3.85 percent 650,000
$ 4,700,000 General Obligation Improvement Bonds of2002
due in annual installments of $ 235,000 to $ 405,000 through
December 1, 2017, interest at 2.00 to 4.30 percent 4,700,000
Total General Obligation Special Assessment Bonds 8,150,000
General Obligation Revenue Bonds:
$ 640,000 General Obligation Sewer Revenue Bonds of2001
due in an annual installments of $ 25,000 to $ 45,000 through
December 1, 2021, interest at 3.30 to 5.15 percent 615,000
$ 810,000 General Obligation Water Revenue Refunding
Bonds or 2002 due in annual installments of $ 40,000
to $ 85,000 through December 1,2016, interest
at 1.75 to 4.80 percent 810,000
Total General Obligation Revenue Bonds 1,425,000
27
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
B. Liabilities (Continued)
4. Bonds Payable (Continued)
Revenue Bonds:
$ 960,000 EDA Public Project Revenue Bonds of2000
due in annual installments of$ 40,000 to $ 95,000 through
December 1,2015, interest at 5.60 to 6.60 percent $ 875,000
TOTAL BONDS PAYABLE $11,735,000
The annual requirements to amortize all bonded debt outstanding as of December 31,
2002, including interest payments of$ 3,907,295 are:
General
General
Year Obligation General
Ending General Special Obligation
December 31, Obligation Assessment Revenue Revenue Total
2003 $ 169,865 $ 1,137,524 $ 159,609 $ 99,435 $ 1,566,433
2004 171,100 1,112,427 160,280 101,825 1,545,632
2005 166,600 1,1 06,200 162,735 98,900 1,534,435
2006 171,750 911,439 114,700 100,950 1,298,839
2007 101,270 735,256 112,475 102,678 1,051,679
2008 - 2012 518,675 3,305,154 581,600 505,281 4,910,710
2013 - 2017 529,625 2,179,145 527,250 300,630 3,536,650
2018 - 2022 0 0 197,917 0 197,917
Totals $ 1,828,885 $ 10,487,145 $ 2,016,566 $ 1,309,699 $ 15,642,295
5. Loans Payable
The following is a summary ofloan transactions for the year ended December 31,2002:
Stearns
Electric
Loans Payable -
January 1, 2002 $ 223,084
Loans Issued 0
Loans Retired (26,924)
Loans Payable -
December 31, 2002 $ 196,160
28
,
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
B. Liabilities (Continued)
5. Loans Payable (Continued)
The annual requirements to amortize all loans outstanding as of December 31, 2002,
including interest payments of $ 7,925 are:
2003 $ 29,155
2004 29,155
2005 29,155
2006 29,155
2007 29,155
2008 - 2009 58,310
Totals $ 204,085
6. Conduit Debt Obligations
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 31,2002, the City's conduit debt consisted of the following:
Outstanding
Balance
12/31/02
Commercial Development Revenue Note (Independence
Center) Series 2001 $ 605,000
Industrial Revenue Bonds (St. Joseph Development, LLC)
Series 2002 3,800,000
$ 4,405,000
29
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
C. Fund Equity
Fund equity balances are classified as follows to reflect the limitations and restrictions of the
respective funds:
1. Fund Balance
a. Reserved Fund Balance is comprised ofthe following:
General Debt Service Total
Notes Receivable $ 10,000 $ 0 $ 10,000
Debt Service 0 3,620,265 3,620,265
Total $ 10,000 $ 3,620,265 $ 3,630,265
b. Unreserved fund balance is comprised of the following:
Special Capital
General Revenue Proj ects Total
Designated for Fire $ 308,354 $ 0 $ 0 $ 308,354
Designated for Capital
Expenditures (55,372) 0 0 (55,372)
Designated for Debt Service 174,745 0 0 174,745
Designated for Working Capital 250,000 0 0 250,000
Undesignated 754,850 73,084 928,123 1,756,057
Total Unreserved
Fund Balance $ 1 ,432,577 $ 73,084 $ 928,123 $ 2,433,784
30
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 3 - DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS (Continued)
C. Fund Equity (Continued)
2. Contributed Capital
Contributed capital in the Enterprise Funds represents fixed assets which were purchased
by other funds and transferred to the Enterprise Funds. Contributed capital is as follows:
Balance December 31, 2001 $ 6,683,167
Capital Contributed in 2002 2,887,640
Balance December 31, 2002 $ 9,570,807
NOTE 4 - SEGMENT INFORMATION FOR ENTERPRISE FUNDS
The City maintains three Enterprise Funds which provide refuse, water and sewer services.
Segment information for the year ended December 31, 2002, is:
Refuse Water Sewer
Fund Fund Fund Total
Operating Revenues $ 151,255 $ 190,212 $ 304,718 $ 646,185
Depreciation 0 67,610 96,736 164,346
Operating Income (Loss) 19,992 (31,946) (26,083) (38,037)
Net Income (Loss) 26,898 178 317 27,393
Contributed Capital 0 4,210,693 5,360,114 9,570,807
Fixed Assets -
Acquisitions 0 780 780 1,560
Net Working Capital 183,791 374,953 637,178 1,195,922
Total Assets 196,770 4,453,124 4,820,673 9,470,567
Total Equity 183,791 4,423,711 4,784,163 9,391,665
NOTE 5 - RISK MANAGEMENT
The City is exposed to various risk of loss related to torts; theft of, damage to and destruction of
assets; errors and omissions; injuries to employees; and natural disasters. In order to protect
against these risks of loss, the City purchases commercial insurance through the League of
Minnesota Cities Insurance Trust, a public entity risk pool. This pool currently operates
common risk management and insurance programs for municipal entities. The City pays an
annual premium to the League for its insurance coverage. The League of Minnesota Cities
Insurance Trust is self-sustaining through commercial companies for excess claims. The City is
covered through the pool for any claims incurred but unreported, however, retains risk for the
deductible portion of its insurance policies. The amounts of these deductib1es are considered
material to the financial statements.
31
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2002
NOTE 5 - RISK MANAGEMENT (Continued)
The City's workers compensation insurance policy is retrospectively rated. With this type of
policy, final premiums are determined after loss experience, workers compensation rates and
salaries for the year are known. The final premium adjustment was recorded in the year the
adjustment was made.
During the year ended December 31, 2002, there were no significant reductions in insurance
coverage from the prior year. Settled claims have not exceeded the City's commercial coverage
in any of the past three years.
I
NOTE 6 - COMMITMENTS
The City plans to construct a new maintenance facility. The total estimated cost to complete the
construction is approximately $ 400,000. Construction is scheduled to begin April 15, 2003.
NOTE 7 - GASB STATEMENT NO. 34
In June 1999, the Governmental Accounting Standards Board (GASB) unanimously approved
Statement No. 34, Basic Financial Statements-and Management's Discussion and Analysis-for
State and Local Governments (Statement). Significant changes in the Statement include the
following:
. For the first time the financial statements will include:
- A Management Discussion and Analysis (MD&A) section providing an analysis of the
City's overall financial position and results of operations.
- Financial statements prepared using full accrual accounting for all of the City's activities,
including reporting infrastructure assets (roads, bridges, etc.).
. A change in the fund financial statements to focus on the major funds.
The general provisions of GASB Statement No. 34 must be implemented by City of S1. Joseph
no later than the fiscal year ending December 31, 2004.
32
CITY OF ST. JOSEPH, MINNESOTA
THE GENERAL FUND
The General Fund accounts for all revenues and expenditures of a governmental unit which are
not accounted for in other funds, and it is usually the largest and most important accounting
activity for state and local governments. It normally receives a greater variety and number of
taxes and other general revenues than any other fund. This fund has flowing into it such
revenues as general property taxes, licenses and permits, fines and penalties, rents, charges for
current services, state aids and interest earnings. The fund's resources also finance a wider range
of activities than any other fund. Most of the current operations of governmental units will be
financed from this fund.
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
CaMP ARA TIVE BALANCE SHEETS
December 31
2002 2001
ASSETS
Cash and Investments $ 1,466,090 $ 1,574,568
Taxes Receivable:
Delinquent 4,037 5,036
Special Assessments Receivable:
Deferred 3,469 7,418
Delinquent 0 208
Accounts Receivable 42,226 42,225
Notes Receivable 10,000 20,000
Interest Receivable 7,949 32,413
Due from Other Governmental Units 98,068 190,437
TOTAL ASSETS $ 1,631,839 $ 1,872,305
LIABILITIES AND FUND BALANCE
Liabilities:
Accrued Liabilities $ 167,231 $ 144,412
Deferred Revenue 7,506 12,662
Compensated Absences Payable 14,525 15,716
Total Liabilities 189,262 172,790
Fund Balance:
Reserved for Notes Receivable 10,000 20,000
Umeserved:
Designated 677,727 972,398
Undesignated 754,850 707,117
Total Fund Balance 1,442,577 1,699,515
TOTAL LIABILITIES AND FUND BALANCE $ 1,631,839 $ 1,872,305
33
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Year Ended December 31, 2002
With Comparative Actual Totals for the Year Ended December 31, 2001
2002 2001
Over
(Under)
Budget Actual Budget Actual
REVENUES:
General Property Tax $ 266,717 $ 257,694 $ (9,023) $ 401,973
Tax Increments ° ° ° 1,716
Special Assessments 21,000 2,570 (18,430) 12,938
Licenses and Pennits 67,350 142,198 74,848 90,366
Intergovernmental:
Federal Grants ° 25,257 25,257 21,425
State -
Local Government Aid 780,719 780,719 ° 531,754
HACA ° 1,055 1,055 62,113
Market Value Credit ° 44,895 44,895 °
Police Aid 28,000 19,616 (8,384) 24,815
Fire Aid 24,000 29,297 5,297 24,969
Other 3,792 7,364 3,572 9,799
County Grants 5,600 7,044 1 ,444 6,751
Total Intergovernmental 842,111 915,247 73,136 681,626
Charges for Services:
General Government 7,500 9,347 1,847 10,144
Public Safety - Fire 145,005 151,279 6,274 143,411
Culture and Recreation 14,000 14,360 360 17,038
Total Charges for Services 166,505 174,986 8,481 170,593
Fines 77,100 56,299 (20,801) 80,512
Miscellaneous:
Investment Income 54,500 47,412 (7,088) 83,802
Park Dedication Fees 0 5,200 5,200 19,806
Refunds and Reimbursements 16,000 68,755 52,755 29,444
Contributions 0 50,519 50,519 27,421
Total Miscellaneous 70,500 171,886 101,386 160,473
Total Revenues 1,511 ,283 1,720,880 209,597 1,600,197
34
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Year Ended December 31, 2002
With Comparative Actual Totals for the Year Ended December 31, 2001
(Continued)
2002 2001
Over
(Under)
Budget Actual Budget Actual
EXPENDITURES:
General Government:
Mayor and Council -
Salaries and Benefits $ 28,889 $ 21,956 $ (6,933) $ 24,747
Supplies 50 35 (15) 236
Travel and Conferences 3,200 3,197 (3) 2,893
Advertising 0 0 0 43
Insurance 550 650 100 550
Dues and Subscriptions 9,150 10,366 1,216 10,546
Other 0 0 0 37
Legislative Committees -
Legislative Bodies 5,000 3,860 (1,140) 3,800
Other 2,375 5,571 3,196 4,496
Elections -
Salaries and Benefits 0 1,087 1,087 0
Supplies 600 495 (105) 0
Professional Services 11,612 8,996 (2,616) 804
Other 1,650 1,289 (361 ) 759
Assessing -
Salaries and Benefits 11,519 12,541 1,022 10,4 71
Supplies 150 42 (108) 0
Travel and Conferences 100 195 95 130
Other 300 313 13 306
Administration -
Salaries and Benefits 98,273 86,750 (11,523) 48,474
Supplies and Maintenance 7,800 9,033 1,233 6,741
Professional Services 11,329 11,109 (220) 1,045
Telephone 2,500 1,622 (878) 1,918
Travel and Conferences 3,000 1,272 (1,728) 1,240
Insurance 1,700 2,000 300 1,700
Capital Expenditures 14,056 22,282 8,226 20,463
Other 2,850 2,555 (295) 2,301
Accounting -
Salaries and Benefits 45,625 47,665 2,040 29,123
Supplies 1,950 2,998 1,048 2,372
Travel and Conferences 1,000 462 (538) 328
Other 1,450 649 (801) 496
Independent Auditing -
Services and Charges 9,000 8,900 (100) 9,736
Legal -
Services and Charges 13,000 24,376 11,376 19,894
35
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Year Ended December 31, 2002
With Comparative Actual Totals for the Year Ended December 31,2001
(Continued)
2002 2001
Over
(Under)
Budget Actual Budget Actual
EXPENDITURES: (Continued)
General Government: (Continued)
Planning and Zoning -
Professional Services $ 0 $ 26,858 $ 26,858 $ 0
Annexation Fee 500 311 (189) 205
Property Tax Sharing 3,500 25,394 21,894 30,259
Joint Planning 100 0 (100) 0
St. Wendel Sewer 500 0 (500) 2,801
General Government Buildings -
Salaries and Benefits 2,636 0 (2,636) 2,116
Supplies and Maintenance 4,900 12,701 7,801 9,283
Professional Services 4,200 4,832 632 4,763
Telephone 500 1,117 617 1,145
Insurance 1,400 1,700 300 700
Utilities 17,300 16,318 (982) 19,691
Other 3,975 3,895 (80) 0
Cable Access 8,566 7,668 (898) 22,089
Total General Government 336,755 393,060 56,305 298,701
Public Safety:
Police -
Salaries and Benefits 393,969 399,102 5,133 384,655
Supplies and Maintenance 12,600 21,864 9,264 12,334
Professional Services 36,600 26,241 (10,359) 30,826
Travel and Conferences 1,500 1,141 (359) 1,307
Insurance 5,000 6,500 1,500 4,882
Advertising 100 122 22 50
Capital Expenditures 11,522 11,187 (335) 14,370
Other 2,170 2,514 344 1,108
Fire Protection -
Salaries and Benefits 57,675 48,551 (9,124) 42,760
Supplies and Maintenance 14,300 17,438 3,138 12,386
Professional Services 7,500 7,166 (334) 7,262
Travel and Conferences 3,750 2,346 (1,404) 2,220
Fire Protection 57,927 60,149 2,222 57,801
Insurance 15,000 15,311 311 14,900
Utilities and Telephone 11,600 8,852 (2,748) 10,099
State Aid Reimbursement and Contributio 25,000 40,977 15,977 27,969
Training 5,800 5,719 (81) 4,872
Capital Expenditures 41,500 340,605 299,105 14,125
Other 1,380 1,049 (331 ) 1,432
36
CITY OF ST. JOSEPH, I\HNNESOT A
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Year Ended December 31, 2002
With Comparative Actual Totals for the Year Ended December 31, 2001
(Continued)
2002 2001
Over
(Under)
Budget Actual Budget Actual
EXPENDITURES: (Continued)
Public Safety: (Continued)
Building Inspection -
Professional Services $ 25,400 $ 73,487 $ 48,087 $ 34,261
Other 5,100 4,955 (145) 3,480
Communication Service -
Supplies and Maintenance 250 56 (194) 645
Telephone 6,000 7,466 1,466 5,551
Capital Expenditures 1,147 1,147 0 0
Automotive Service -
Supplies and Maintenance 10,750 14,950 4,200 16,072
Motor Vehicles 16,471 20,127 3,656 14,729
Emergency Management Service -
Professional Services 300 375 75 380
Capital Expenditures 2,000 0 (2,000) 0
Other 1,700 1,243 (457) 0
Animal Control -
Supplies 100 71 (29) 0
Professional Services 700 1,032 332 235
Total Public Safety 774,811 1,141,743 366,932 720,711
Public Works:
Street Maintenance -
Salaries and Benefits 90,639 102,195 11,556 101,494
Supplies and Maintenance 15,800 15,705 (95) 15,624
Professional Services 100 0 (100) 0
Travel and Conferences 200 0 (200) 89
Insurance 6,100 6,930 830 6,642
Utilities and Telephone 7,000 3,800 (3,200) 3,989
Capital Expenditures 44,533 27,967 (16,566) 75,560
Other 1,900 2,208 308 2,127
Industrial Development -
Professional Services 3,000 637 (2,363) 351
Ice and Snow Removal -
Salaries and Benefits 26,678 18,430 (8,248) 32,663
Supplies and Maintenance 18,500 16,311 (2,189) 13,973
Professional Services 1,500 0 (1,500) 1,395
Capital Expenditures 11,709 11,709 0 314
Other 2,000 1,215 (785) 3,460
37
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Year Ended December 31, 2002
With Comparative Actual Totals for the Year Ended December 31, 2001
(Continued)
2002 2001
Over
(Under)
Budget Actual Budget Actual
EXPENDITURES: (Continued)
Public Works: (Continued)
Engineering -
Professional Services $ 17,000 $ 48,378 $ 31,378 $ 38,080
Street Lighting -
Supplies and Maintenance 250 0 (250) 23
Utilities 30,500 24,010 (6,490) 24,883
Capital Expenditures 1,200 0 (1,200) 5,880
Street Cleaning -
Salaries and Benefits 5,141 5,290 149 3,669
Supplies and Maintenance 6,000 494 (5,506) 7,082
Travel and Conferences 100 0 (100) 0
Capital Expenditures 2,000 0 (2,000) 0
Total Public Works 291,850 285,279 (6,571) 337,298
Culture and Recreation:
Participant Recreation -
Salaries and Benefits 14,094 8,630 (5,464) 8,879
Supplies and Maintenance 2,400 4,457 2,057 2,726
Professional Services 2,000 1,438 (562) 1,300
Insurance 500 600 100 500
Advertising 100 176 76 63
Other 1,500 669 (831) 829
Ball Park and Skating Rink -
Salaries and Benefits 3,280 2,134 (1,146) 10,395
Supplies and Maintenance 700 309 (391) 453
Professional Services 0 236 236 364
Rentals 200 0 0 128
Utilities 1,000 422 (578) 1,023
Capital Expenditures 0 582 582 1,623
Maintenance Shop -
Supplies and Maintenance 3,725 4,036 311 4,588
Telephone 1,600 1,501 (99) 1,440
Utilities 3,400 1,475 (1,925) 2,192
Capital Expenditures 2,000 0 (2,000) 0
Other 100 0 (100) 0
Park Areas -
Salaries and Benefits 55,559 58,639 3,080 54,338
Supplies and Maintenance 14,100 12,850 (1,250) 11,677
Telephone 200 516 316 227
Insurance 1,200 1,500 300 1,425
Utilities 3,100 2,251 (849) 2,176
Capital Expenditures 13,100 6,080 (7,020) 42,471
Other 750 210 (540) 278
38
CITY OF ST. JOSEPH, MINNESOTA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
Year Ended December 31, 2002
With Comparative Actual Totals for the Year Ended December 31, 2001
(Continued)
2002 2001
Over
(Under)
Budget Actual Budget Actual
EXPENDITURES: (Continued)
Culture and Recreation: (Continued)
Park Board -
Capital Expenditures $ 26,450 $ 16,595 $ (9,855) $ 0
Shade Tree Disease Control -
Supplies and Maintenance 75 0 (75) 0
Travel and Conferences 100 0 (100) 55
Community Support -
Insurance 300 350 50 300
Other 9,000 6,500 (2,500) 6,932
Total Culture and Recreation 160,533 132,156 (28,377) 156,382
Economic Development Authority:
Salaries and Benefits 0 0 0 29,792
Supplies 0 0 0 70
Telephone 0 0 0 836
Travel and Conferences 0 0 0 1,394
Professional Services 0 0 0 8,720
Capital Expenditures 0 0 0 240
Other 0 0 0 7,814
Total Economic Development 0 0 0 48,866
Miscellaneous:
Payments to Township 0 75,399 75,399 0
Other 500 28,242 27,742 222
Total Miscellaneous 500 103,641 103,141 222
Total Expenditures 1,564,449 2,055,879 491,430 1,562,180
REVENUES OVER (UNDER) EXPENDITURES (53,166) (334,999) (281,833) 38,017
OTHER FINANCING USES:
Operating Transfers In 900 0 (900) 0
Operating Transfers Out 0 (87,531) (87,531) 0
Sale of Surplus Property 0 165,592 165,592 69,471
Total Other Financing Sources 900 78,061 77,161 69,471
EXCESS OF REVENUES OVER (UNDER)
EXPENDITURES AND OTHER
FINANCING USES $ (52,266) (256,938) $ (204,672) 107,488
FUND BALANCE - January 1 1,699,515 1,592,027
FUND BALANCE - December 31 $ 1 ,442,577 $ 1,699,515
39
CITY OF ST. JOSEPH, MINNESOTA
SPECIAL REVENUE FUNDS
Special Revenue Funds are used to account for revenues derived from specific taxes or other
earmarked revenue sources. They are usually required by statute, charter provision, or local
ordinance to finance particular functions or activities of government.
CITY OF ST. JOSEPH, MINNESOTA
SPECIAL REVENUE FUNDS
COMæ~GBALANCESHEET
December 31, 2002
With Comparative Totals for December 31, 2001
FUND # I 150 I I 155 I I 210 I
Economic TIF 1-3 Recreation
Development Borgert Center
ASSETS
Cash and Investments $ 16,490 $ 24,934 $ 38,833
Interest Receivable (106) 0 336
TOTAL ASSETS $ 16,384 $ 24,934 $ 39,169
LIABILITIES A1'\fD FUND BALANCE
Liabilities:
Cash Overdraft $ 13,493 $ 0 $ 0
Accounts Payable 2,891 7,606 0
TOTAL LIABILITIES 16,384 7,606 0
Fund Balance:
Unreserved -
Undesignated 0 17,328 39,169
TOTAL LIlillILITIES AND FUND BALANCE $ 16,384 $ 24,934 $ 39,169
I 225 I I 230 I I 232 I I 250 I
DARE Lake Wobegon City Revolving Totals
Program Trail Beautification Loan 2002 2001
$ 624 $ 11,991 $ 3,761 $ 4 $ 96,637 $ 43,881
0 104 103 0 437 906
$ 624 $ 12,095 $ 3,864 $ 4 $ 97,074 $ 44,787
$ 0 $ 0 $ 0 $ 0 $ 13,493 $ 0
0 0 0 0 10,497 105
0 0 0 0 23,990 105
624 12,095 3,864 4 73,084 44,682
$ 624 $ 12,095 $ 3,864 $ 4 $ 97,074 $ 44,787
40
CITY OF ST. JOSEPH, MINNESOTA
SPECIAL REVENUE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
A¡~D CHANGES IN FUND BALANCE
Year Ended December 31, 2002
With Comparative Totals for the Year Ended December 31, 2001
FUND # I 150 I I 155 I I 156 I I 210 I
TIF 1-4
Economic TIF 1-3 St. Joe Recreation
Development Borgert Development Center
REVENUES:
Miscellaneous -
Investment Income $ 8 $ 0 $ 0 $ 1,865
Tax Increments 0 30,128 12,200 0
Contributions 0 0 0 0
Total Revenues 8 30,128 12,200 1,865
EXPENDITURES:
Public Safety -
Supplies and Maintenance 0 0 0 0
Economic Development 34,585 30,445 12,200 0
Total Expenditures 34,585 30,445 12,200 0
EXCESS OF REVENUES OVER (UNDER)
EXPENDITURES (34,577) (317) 0 1,865
OTHER FINANCING SOURCES (USES):
Operating Transfers In 34,577 17,645 0 0
EXCESS OF REVEN1JE A¡~D OTHER
FINANCING SOURCES OVER (UNDER)
EXPENDITURES 0 17,328 0 1,865
FUND BALANCE - January 1 0 0 0 37,304
FUND BALANCE - December 31 $ 0 $ 17 ,328 $ 0 $ 39,169
,
I
I
;
,
,
I 225 I I 230 I I 232 I I 250 I
DARE Lake W obegon City Revolving Totals
Program Trail Beautification Loan 2002 2001
$ 0 $ 591 $ 374 $ 4 $ 2,842 $ 2,322
0 0 0 0 42,328 0
I 0 5,000 45,022 0 50,022 6,000
0 5,591 45,396 4 95,192 8,322
250 0 41,532 0 41,782 477
0 0 0 0 77,230 0
250 0 41,532 0 119,012 477
(250) 5,591 3,864 4 (23,820) 7,845
0 0 0 0 52,222 0
(250) 5,591 3,864 4 28,402 0
874 6,504 0 0 44,682 36,837
$ 624 $ 12,095 $ 3,864 $ 4 $ 73,084 $ 44,682
41
I
CITY OF ST. JOSEPH, MINNESOTA
DEBT SERVICE FUNDS
Debt Service Funds are created to account for the payment of interest and principal on long-term,
general obligation debt other than debt issued for and serviced primarily by a governmental
enterprise.
I
I
-
CITY OF ST. JOSEPH, MINNESOTA
DEBT SERVICE FUNDS
COMBINING BALANCE SHEET
December 31, 2002
With Comparative Totals for December 31, 2001
FUND # I 308 I I 312 I I 315 I
General General General
Obligation Obligation Obligation
Improvement Improvement Improvement
Bonds Bonds Bonds
of 1992 of1993 of1996
ASSETS
Cash and Investments $ 28,963 $ 148,965 $ 667,940
Taxes Receivable -
Delinquent 117 276 1,037
Special Assessments Receivable -
Deferred 11,825 27,575 112,954
Delinquent 0 0 515
Accounts Receivable 0 0 0
Interest Receivable 182 1,135 5,349
Due from Other Governmental Units 0 5,029 10,773
TOTAL ASSETS $ 41,087 $ 182.980 $ 798,568
LIABILITIES At,\¡D FUND BALANCE
Liabilities:
Cash Overdraft S 0 S 0 S 0
Accounts Payable 0 0 0
Deferred Revenue 11,942 27,851 114,506
Total Liabilities 11,942 27,851 114,506
Fund Balance (Deficit):
Reserved for Debt Service 29,145 155,129 684,062
TOTAL LIABILITIES AND
FUND BALAt,\¡CE S 41,087 S 182.980 S 798.568
I 317 I I 319 I I 321 I I 322 I I 324 I I 330 I I 325 I
EDA General
Public Obligation General
General General General Project General Sewer Obligation
Obligation Obligation Obligation Revenue Obligation Revenue Improvement
Bonds Bonds Bonds Bonds Bonds Bonds Bonds
of1997 of1998 ofl999 of 2000 of2001 of2001 of2002
$ 230,221 $ 258,279 $ 75,539 $ 612 $ 559,652 $ 0 $ 916,669
575 99 389 1,359 0 0 0
0 169,374 807,145 0 58,802 120,812 1,935,540
0 301 20,358 0 2,720 0 0
0 0 69,628 0 0 0 0
1,800 2,060 (102) (612) 4,993 (581) 22,289
0 4,433 12,118 0 53,327 2,379 0
$ 232,596 $ 434,546 $ 985,075 $ 1,359 $ 679,494 $ 122,610 $ 2,874,498
$ 0 $ 0 $ 0 $ 0 $ 0 $ 34,464 $ 0
1,500 0 0 0 0 0 8,424
575 169,774 827,892 1,359 61,522 120,812 1,935,540
2,075 169,774 827,892 1,359 61,522 155,276 1,943,964
230,521 264,772 157,183 0 617,972 (32,666) 930,534
$ 232,596 $ 434,546 $ 985,075 $ 1,359 $ 679,494 $ 122,610 $ 2,874,498
42
CITY OF ST. JOSEPH, MINNESOTA
DEBT SERVICE FUNDS
COMBINING BALANCE SHEET
December 31, 2002
With Comparative Totals for December 31, 2001
(Continued)
FUND # I 326 I I 327 I
General
Obligation General
Water Obligation
Revenue Certificate of
Bonds Indebtedness Totals
of2002 of2002 2002 2001
ASSETS
Cash and Investments $ 556,393 $ 12,971 $ 3,456,204 $ 2,293,762
Taxes Receivable -
Delinquent 0 0 3,852 2,066
Special Assessments Receivable -
Deferred 0 0 3,244,027 1,599,340
Delinquent 0 0 23,894 3,091
Accounts Receivable 7,473 0 77,101 108,754
Interest Receivable 4,671 2,105 43,289 63,852
Due from Other Governmental Units 0 0 88,059 76,082
TOTAL ASSETS $ 568,537 $ 15,076 $ 6,936,426 $ 4,146,947
LIABILITIES AND FUND BALANCE
Liabilities:
Cash Overdraft $ 0 $ 0 $ 34,464 $ 16,891
Accounts Payable 0 0 9,924 30,655
Deferred Revenue 0 0 3,271,773 1,604,497
Total Liabilities 0 0 3,316,161 1,652,043
Fund Balance (Deficit):
Reserved for Debt Service 568,537 15,076 3,620,265 2,494,904
TOTAL LIABILITIES AND
FUND BALANCE $ 568,537 $ 15,076 $ 6,936,426 $ 4,146,947
43
CITY OF ST. JOSEPH, MINNESOTA
DEBT SERVICE FUNDS
\
COMBINING STATEMENT OF REVENUES, EXPE1\TDITURES
Ai'J'D CHANGES IN FUND BALANCE
Year Ended December 31, 2002
\Vith Comparative Totals for the Year Ended December 31,2001
FUND # I 308 II 309 II 312 II 314 II 315 I
General General
General Obligation General Obligation General
Obligation Water Obligation Water Obligation
Improvement Revenue Improvement Revenue Improvement
Bonds Bonds Bonds Bonds Bonds
of1992 ofl992 of1993 of1996 of1996
REVENUES:
General Property Taxes $ 7,653 $ 0 $ 17,858 $ 0 $ 63,347
Special Assessments 2,961 0 18,027 0 29,409
Intergovernmental 1,347 0 3,143 0 11,224
Miscellaneous -
Investment Income 1,605 2,974 7,546 20,915 31,317
Other 0 89,626 0 31,903 0
Total Revenues 13,566 92,600 46,574 52,818 135,297
EXPENDITURES:
Debt Service -
Bond Principal 15,000 190,000 35,000 670,000 75,000
Bond Interest and Fiscal Charges 6,635 11,243 15,310 38,430 52,175
Total Expenditures 21,635 201,243 50,310 708,430 127,175
EXCESS OF REVENUES OVER (UNDER)
EXPE1\TDITURES (8,069) (108,643) (3,736) (655,612) 8,122
OTHER FINANCING SOURCES:
Operating Transfers In 0 0 0 0 0
Proceeds from the Sale of Bonds 0 145,000 0 645,000 0
Total Other Financing Sources 0 145,000 0 645,000 0
EXCESS OF REVENUES AND OTHER
FINANCING SOURCES OVER (UNDER)
EXPENDITURES (8,069) 36,357 (3,736) (10,612) 8,122
FUND BALANCE - January 1 37,214 44,657 158,865 491,436 675,940
RESIDUAL EQUITY TRAt"'\¡'SFER 0 (81,014) 0 (480,824) 0
FUND BALANCE (DEFICIT) - December 31 $ 29,145 $ 0 $ 155,129 $ 0 $ 684,062
I
I 317 I I 319 I I 321 I I 322 I I 324 I I 330 I
EDA General
Public Obligation
General General General Project General Sewer
Obligation Obligation Obligation Revenue Obligation Revenue
Bonds Bonds Bonds Bonds Bonds Bonds
of1997 of 1998 of1999 of2000 of 200 1 of 200 1
$ 35,133 $ 6,336 $ 24,779 $ 86,482 $ 0 $ °
61,173 42,000 168,002 0 282,940 36,334
6,161 1,115 4,363 15,265 0 0
11,971 12,660 3,047 (1,738) 20,935 (10,446)
0 0 0 0 ° 0
114,438 62,111 200,191 100,009 303,875 25,888
45,000 30,000 96,924 45,000 160,000 25,000
59,555 21,988 61,957 57,000 34,972 33,877
104,555 51,988 158,881 102,000 194,972 58,877
9,883 10,123 41 ,3 10 (1,991 ) 108,903 (32,989)
0 0 0 15,751 0 0
0 0 0 0 0 0
0 0 0 15,751 0 0
9,883 10,123 41,310 13,760 108,903 (32,989)
220,638 254,649 115,873 (13,760) 509,069 323
0 0 0 0 0 0
$ 230,521 $ 264,772 $ 157,183 $ 0 $ 617,972 $ (32,666)
44
CITY OF ST. JOSEPH, MINNESOTA
DEBT SERVICE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
Ai\!D CHANGES IN FUND BALANCE
Year Ended December 31, 2002
Vlith Comparative Totals for the Year Ended December 31, 2001
FUND # I 325 I I 326 II 327 I
General
General Obligation General
Obligation Water Obligation
Improvement Revenue Certificate of
Bonds Bonds Indebtedness Totals
of2002 of2002 of 2002 2002 2001
REVEI\TUES:
General Property Taxes $ 0 $ 0 $ 0 $ 241,588 $ 254,430
Special Assessments 530,697 0 0 1,171,543 880,891
Intergovernmental 298,546 0 0 341,164 62,584
Miscellaneous -
Investment Income 55,959 7,133 3,021 166,899 170,017
Other 900 0 0 122,429 93,530
Total Revenues 886,102 7,133 3,021 2,043,623 1,461,452
EXPENDITURES:
Debt Service -
Bond Principal 0 0 0 1,386,924 386,657
Bond Interest and Fiscal Charges 67,347 6,580 8,140 475,209 342,492
Total Expenditures 67,347 6,580 8,140 1,862,133 729,149
EXCESS OF REVENUES OVER (UNDER)
EXPENDITURES 818,755 553 (5,119) 181,490 732,303
OTHER FINANCING SOURCES:
Operating Transfers In 0 0 19,558 35,309 50,000
Proceeds from the Sale of Bonds 111,779 6,146 567 908,492 24,493
Total Other Financing Sources 111,779 6,146 20,125 943,801 74,493
EXCESS OF REVENUES Ai\!D OTHER
FINANCING SOURCES OVER (UNDER)
EXPENDITURES 930,534 6,699 15,006 1,125,291 806,796
FUND BALANCE - January 1 0 0 0 2,494,904 2,055,016
RESIDUAL EQUITY TRANSFER 0 561,838 70 70 (366,908)
FUND BALANCE (DEFICIT) - December 31 $ 930,534 $ 568,537 $ 15,076 $ 3,620,265 $ 2,494,904
45
,
, CITY OF ST. JOSEPH, MINNESOTA
CAPITAL PROJECTS FUNDS
Capital Projects Funds are created to account for all resources used for the acquisition of capital
facilities by a governmental unit except those financed by enterprise funds.
¡
CITY OF ST. JOSEPH, MINNESOTA
CAP IT AL PROJECTS FUNDS
COMB~GBALANCESHEET
December 31, 2002
With Comparative Totals for December 31,2001
FUND # I 424 I I 425 I I 501 I
2002
Northland Street Trunk
Phase Five Improvements Sewer
ASSETS
Cash and Investments $ 58,424 $ 976,362 $ 37,409
Special Assessments Receivable
Deferred 0 0 0
Interest Receivable 0 0 1,570
Due from Other Governments 0 57,964 0
TOTAL ASSETS $ 58,424 $ 1,034,326 $ 38,979
LIABILITIES AND FUND BALA1,\¡,CE
Liabilities:
Cash Overdraft $ 0 $ 0 $ 0
Accrued Liabilities 0 21,840 2,214
Contracts Payable 11,964 160,467 7,121
Deferred Revenue 0 0 0
Total Liabilities 11,964 182,307 9,335
Fund Balance:
Unreserved -
Undesignated 46,460 852,019 29,644
Total Fund Balance 46,460 852,019 29,644
TOTAL LIABILITIES
AND FUND BALANCE $ 58,424 $ 1,034,326 $ 38,979
\
Totals
2002 2001
$ 1,072,195 $ 294,312
0 145,699
1,570 (to,736)
57,964 0
$ 1,131,729 $ 429,275
$ 0 $ 46,005
24,054 43,720
179,552 0
0 145,699
203,606 235,424
928,123 193,851
928,123 193,851
$ 1,131,729 $ 429,275
46
CITY OF ST. JOSEPH, I\UNNESOT A
CAPITAL PROJECTS FUNDS
COMBINING STATEMENT OF REVENUES, EXPE1\TDITURES
AND CHAt"\¡GES IN FUND BALANCE
Year Ended December 31, 2002
With Comparative Totals for the Year Ended December 31, 2001
FUND # I 423 I I 424 I I 425 I I 327 I
2002 2002
County Northland Street Equipment
Road 121 Phase Five Improvements Purchase
REVENUES:
Special Assessments $ 0 $ 0 $ 0 $ 0
Intergovernmental 0 0 75,091 0
Charges for Services 0 0 0 0
Miscellaneous -
Investment Income 0 9,348 0 0
Total Revenues 0 9,348 75,091 0
EXPENDITURES:
Capital Outlay -
Construction Costs 0 57,865 3,659,897 0
Other 0 0 0 240,643
Total Expenditures 0 57,865 3,659,897 240,643
EXCESS OF REVENUES OVER (UNDER)
EXPENDITURES 0 (48,517) (3,584,806) (240,643)
OTHER FINANCING SOURCES (USES):
Operating Transfers In 0 0 0 0
Proceeds from the Sale of Bonds 0 0 4,495,438 240,713
Total Other Financing Sources (Uses) 0 0 4,495,438 240,713
EXCESS OF REVENUES AND OTHER
FINANCING SOURCES OVER (UNDER)
EXPENDITURES AND OTHER FINANCING
USES 0 (48,517) 910,632 70
FUND BALANCE (DEFICIT) - January 1 (37,612) 94,977 (21,001) 0
RESIDUAL EQUITY TRANSFER 37,612 0 (37,612) (70)
FU1\TD BALANCE (DEFICIT) - December 31 $ 0 $ 46,460 $ 852,019 $ 0
I 501 I
Trunk Totals
Sewer 2002 2001
$ 0 $ 0 $ 30,051
0 75,091 0
45,318 45,318 23,488
7,893 17,241 (31,770)
53,211 137,650 21,769
181,054 3,898,816 1,691,110
0 240,643 30,710
181,054 4,139,459 1,721,820
(127,843) (4,001,809) (1,700,051 )
0 0 247,000
0 4,736,151 1,411,905
0 4,736,151 1,658,905
(127,843) 734,342 (41,146)
157,487 193,851 (131,911)
0 (70) 366,908
$ 29,644 $ 928,123 $ 193,851
47
CITY OF ST. JOSEPH, MINNESOTA
ENTERPRISE FUNDS
Enterprise Funds are established to account for the financing of self-supporting activities of
governmental units which render services on a user charge basis to the general public. The most
universal type of governmental enterprise is the public utility engaged in the provision of such
basic services as water, electricity, and natural gas. Sanitary sewer systems financed by user
charges have also assumed the status of public utility operations in many urban areas, and many
cities have combined water and sewer systems under the same management.
CITY OF ST. JOSEPH, MINNESOTA
ENTERPRISE FUNDS
COMBnITNGBALANCESHEET
December 31, 2002
With Comparative Totals for December 31, 2001
FUND # I 603 I I 601 I I 602 I
Refuse Water Sewer
Fund Fund Fund
ASSETS
Current Assets:
Cash and Cash Equivalents $ 166,372 $ 373,946 $ 593,410
Accounts Receivable 29,073 27,288 75,088
Interest Receivable 1,325 3,132 5,190
Total Current Assets 196,770 404,366 673,688
Fixed Assets:
Land and Land Improvements ° 12,996 4,941
Treatment Plant and Lines 0 3,340,767 4,702,757
Buildings ° ° 517,983
Water Storage Facility ° 1,236,542 °
Machinery and Equipment 0 91,464 179,918
° 4,681,769 5,405,599
Less: Accumulated Depreciation ° (633,011) (1,258,614)
Net Fixed Assets 0 4,048,758 4,146,985
TOTAL ASSETS $ 196,770 $ 4,453,124 $ 4,820,673
LIABILITIES AND FUND EQUITY
Current Liabilities:
Accrued Liabilities $ 9,751 $ 11,284 $ 22,463
Compensated Absences Payable 3,228 18,129 14,047
Total Current Liabilities 12,979 29,413 36,510
Fund Equity:
Contributed Capital 0 4,210,693 5,360,114
Retained Earnings (Deficit) -
Unreserved 183,791 213,018 (575,951)
Total Fund Equity 183,791 4,423,711 4,784,163
TOTAL LIABILITIES AND
FUND EQUITY $ 196,770 $ 4,453,124 $ 4,820,673
Totals
2002 2001
$ 1,133,728 $ 888,680
131,449 178,809
9,647 19,828
1,274,824 1,087,317
17,937 17,937
8,043,524 5,174,383
517,983 517,983
1,236,542 1,236,542
271,382 269,822
10,087,368 7,216,667
(1,891,625) (1,737,872)
8,195,743 5,478,795
$ 9,470,567 $ 6,566,112
$ 43,498 $ 57,545
35,404 31,935
78,902 89,480
9,570,807 6,683,167
(179,142) (206,535)
9,391,665 6,476,632
$ 9,470,567 $ 6,566,112
48
CITY OF ST. JOSEPH, MINNESOTA
ENTERPRISE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN RETAINED EARNINGS
Year Ended December 31, 2002
With Comparative Totals for the Year Ended December 31, 2001
Refuse Water Sewer
Fund Fund Fund
OPERATING REVENUES:
Charges for Services $ 151,255 $ 190,212 $ 304,718
OPERATING EXPENSES:
Salaries and Benefits 21,258 83,430 75,931
Utilities 0 19,175 9,666
Supplies 412 13,635 2,499
Sewer Use Rental 0 0 125,374
Postage 473 575 473
Repairs and Maintenance 2 22,443 8,856
Professional Fees 0 0 0
Fees and Tests 238 7,699 2,128
Dues and Subscriptions 0 484 142
Refuse Disposal 108,815 0 729
Depreciation 0 67,610 96,736
Insurance 0 4,500 6,300
Miscellaneous 65 2,607 1,967
Total Operating Expenses 131,263 222,158 330,801
OPERATING INCOME (LOSS) 19,992 (31,946) (26,083)
NON-OPERATING REVE1\TUES (EXPENSES):
Investment Income 6,906 15,509 34,307
Other Revenues 0 16,615 0
Loss on Disposal of Property 0 0 (7,907)
Total Non-Operating Revenues (Expenses) 6,906 32,124 26,400
INCOME BEFORE OPERATING
TRANSFER 26,898 178 317
Operating Transfer Out 0 0 0
NET INCOME (LOSS) 26,898 178 317
RETAINED EARNINGS (DEFICIT) - January 1 156,893 212,840 (576,268)
RETAINED EARNINGS (DEFICIT) - December 31 $ 183,791 $ 213,018 $ (575,951)
Totals
2002 2001
$ 646,185 $ 656,677
180,619 136,203
28,841 28,748
16,546 14,638
125,374 123,898
1,521 1,890
31,301 32,649
0 765
10,065 12,535
626 610
109,544 96,745
164,346 142,395
10,800 8,734
4,639 5,292
684,222 605,102
(38,037) 51,575
56,722 60,011
16,615 19,891
(7,907) 19,891
65,430 79,902
27,393 131,477
0 (297,000)
27,393 (165,523)
(206,535) (41,012)
$ (179,142) $ (206,535)
49
CITY OF ST. JOSEPH, MINNESOTA
ENTERPRISE FUNDS
COMBINING STATEMENT OF CASH FLOÌ¡VS
Year Ended December 31, 2002
With Comparative Totals for the Year Ended December 31,2001
Refuse Ì¡Vater Sewer
Fund Fund Fund
CASH FLOWS FROM OPERATING ACTIVITIES:
Operating Income (Loss) $ 19,992 $ (31,946) $ (26,083)
Adjustments to Reconcile Operating Income
(Loss) to Net Cash Provided by Operating
Activities:
Depreciation 0 67,610 96,736
Other Non-Operating Revenues 0 16,615 0
Change in Assets and Liabilities:
Accounts Receivable (2,966) 1,984 48,342
Accrued Liabilities 421 775 (15,243)
Due to Other Governmental Units 0 0 0
Compensated Absences Payable 615 2,221 633
Total Adjustments (1,930) 89,205 130,468
Net Cash Provided by Operating Activities 18,062 57,259 104,385
CASH FLOWS FROM NON CAP IT AL
FINANCING ACTIVITIES:
Operating Transfer to Other Fund 0 0 0
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:
Capital Acquisitions 0 (780) (780)
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment Income 8,739 19,512 38,651
Net Increase (Decrease) in Cash and Cash Equivalents 26,801 75,991 142,256
Cash and Cash Equivalents, January 1 139,571 297,955 451,154
Cash and Cash Equivalents, December 31 $ 166,372 $ 373,946 $ 593,410
Totals
2002 2001
$ (38,037) $ 51,575
164,346 142,395
16,615 19,891
!
47,360 (1,119)
(14,047) 16,725
0 (17,117)
3,469 3,720
217,743 164,495
179,706 216,070
0 (297,000)
(1,560) (9,295)
66,902 60,791
245,048 (29,434)
888,680 918,114
$ 1,133,728 $ 888,680
50
CITY OF ST. JOSEPH, MINNESOTA
STATEMENT OF GENERAL LONG-TERM DEBT
December 31, 2002
2002 2001
AMOUNT A V AILABLE AND TO BE PROVIDED FOR
THE PAYMENT OF GENERAL LONG-TERM DEBT:
Amount Available in Debt Service Funds $ 3,620,265 $ 2,494,904
Amount to be Provided from Special Assessments 3,267,921 1,602,431
Amount to be Provided for Compensated Absences Payable 58,005 54,584
Amount to be Provided for Retirement of General Long- Tenn
Debt 5,042,974 3,465,749
TOTAL AVAILABLE AND TO BE PROVIDED FOR
RETIREMENT OF GENERAL LONG-TERM DEBT $ 11,989,165 $ 7,617,668
GENERAL LONG-TERM DEBT:
Compensated Absences Payable $ 58,005 $ 54,584
Bonds Payable 11,735,000 7,340,000
Loans Payable 196,160 223,084
TOTAL GENERAL LONG-TERM DEBT $ 11,989,165 $ 7,617,668
51
CITY OF ST. JOSEPH, MINNESOTA
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Year Ended December 31, 2002
Federal Assistance
Number and Administering 2002
Funding Source Department Grant Name/Program Expenditures
CFDA No. 14.228 Minnesota Department Small Cities
Department of Housing of Trade and Economic Development
and Urban Development Development Program $ 373,638
CDAP-01-0125-0-FY02
CFDA No.20.601 State of Minnesota Safe & Sober 3,676
Department of
Transportation
CFDA No. 16.710 N/A COPS MORE01
Department of Justice Award 23,698
2001CMWX0238
CFDA No. 16. N/A Bulletproof Vest
Department of Justice Partnership Program 1,878
Total $ 402,890
The ~he Schedule of Expenditures of Federal Awards are
an integral part of this statement. 52
CITY OF ST. JOSEPH, MINNESOTA
NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Year Ended December 31, 2002
NOTE A - BASIS OF PRESENT A TION
The accompanying schedule of expenditures of federal awards includes the federal grant activity
of the City of St. Joseph and is presented on the modified accrual basis of accounting. The
infonnation in this schedule is presented in accordance with the requirements of OMB Circular
A-133, Audits of States, Local Governments and Non-Profit Organizations. Therefore, some
amounts presented in this schedule may differ from amounts presented in, or used in the
preparation of, the general purpose financial statements.
53
~DV
KE RN· DEWENT E R· VI ERE
CITY OF ST. JOSEPH, MINNESOTA
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL
REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN
ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
February 20, 2003
Honorable Mayor and City Council
City of S1. Joseph
S1. Joseph, Minnesota
We have audited the financial statements of City of S1. Joseph, Minnesota as of and for the year
ended December 31, 2002, and have issued our report thereon dated February 20, 2003. 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 ofthe United States.
Compliance
As part of obtaining reasonable assurance about whether the City's financial statements are ftee
of material misstatement, we perfonned tests of its compliance with certain provisions of laws,
regulations, contracts, and grants, noncompliance with which could have a direct and material
effect on the detennination of financial statement amounts. However, providing an opinion on
compliance with those provisions was not an objective of our audit and, accordingly, we do not
express such an opinion. The results of our tests disclosed no instances of noncompliance that
are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and perfonning our audit, we considered the City's internal control over financial
reporting in order to detennine our auditing procedures for the purpose of expressing our opinion
on the financial statements and not to provide assurance on the internal control over financial
reporting. However, we noted a certain matter involving the internal control over financial
reporting and its operation that we consider to be a reportable condition. Reportable conditions
involve matters coming to our attention relating to significant deficiencies in the design or
operation of the internal control over financial reporting that, in our judgment, could adversely
affect the City's ability to record, process, summarize and report financial data consistent with
the assertions of management in the financial statements. The reportable condition is described
in the accompanying Schedule of Findings and Corrective Action Plans on Compliance with
Minnesota Statutes and Internal Controls.
54
KDV
KERN· DEWENTER· V] ERE
A material weakness is a condition in which the design or operation of one or more of the
internal control components does not reduce to a relatively low level the risk that misstatements
in amounts that would be material in relation to the financial statements being audited may occur
and not be detected within a timely period by employees in the normal course of performing their
assigned functions. Our consideration of the internal control over financial reporting would not
necessarily disclose all matters in the internal control that might be reportable conditions and,
accordingly, would not necessarily disclose all reportable conditions that are also considered to
be material weakness. However, we do not believe the reportable condition described is a
material weakness. We also noted other matters involving the internal control over financial
reporting that we have reported to the management of the City of St. Joseph, Minnesota in a
separate letter dated February 20,2003.
This report is intended solely for the information and use of the City's Administration, City
Council, and state and federal awarding and oversight agencies, and is not intended to be, and
should not be, used by anyone other than those specified parties.
K.(A,IL / &M ¡J ~ I Vu.-u I L- fd
KERN, DEWENTER, VIERE, LTD.
St. Cloud, Minnesota
55
~DV
KERN· DEWENTER·VI ERE
CITY OF ST. JOSEPH, MINNESOTA
INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH
REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM
AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE
WITH OMB CIRCULARA-I33
February 20, 2003
Honorable Mayor and City Council
City of St. Joseph
St. Joseph, Minnesota
Compliance
We have audited the compliance of the City ofSt. Joseph, Minnesota, with the types of
compliance requirements described in the US. Office of Management and Budget (OMB)
Circular A-I33 Compliance Supplement that are applicable to each of its major federal programs
for the year ended December 31, 2002. The City's major federal programs are identified in the
summary of auditors' results section of the accompanying schedule of findings and questioned
costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to
each of its major federal programs is the responsibility ofthe City's management. Our
responsibility is to express an opinion on the City ofSt. Joseph, Minnesota's compliance based
on our audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted
in the United States of America; the standards applicable to financial audits contained in
Government Auditing Standards, issued by the Comptroller General ofthe United States; and
OMB Circular A-I33, Audits of States, Local Governments, and Non-Profit Organizations.
Those standards and OMB Circular A-I33 require that we plan and perform the audit to obtain
reasonable assurance about whether noncompliance with the types of compliance requirements
referred to above that could have a direct and material effect on a major federal program
occurred. An audit includes examining, on a test basis, evidence about the City's compliance
with those requirements and performing such other procedures as we considered necessary in the
circumstances. We believe that our aúdit provides a reasonable basis for our opinion. Our audit
does not provide a legal determination on the City's compliance with those requirements.
In our opinion, the City of St. Joseph, Minnesota, complied, in all material respects, with the
requirements referred to above that are applicable to each of its major federal programs for the
year ended December 31, 2002.
56
KDV
KERN· DEWENTER·V] ERE
Internal Control Over Compliance
The management of the City of St. Joseph, Minnesota is responsible for establishing and
maintaining effective internal control over compliance with requirements of laws, regulations,
contracts and grants applicable to federal programs. In planning and performing our audit, we
considered the City's internal control over compliance with requirements that could have a direct
and material effect on a major federal program in order to determine our auditing procedures for
the purpose of expressing our opinion on compliance and to test and report on internal control
over compliance in accordance with ŒMB Circular A-i33.
We noted a certain matter involving the internal control over compliance and its operation that
we consider to be a reportable condition. Reportable conditions involve matters coming to our
attention relating to significant deficiencies in the design or operation of the internal control over
compliance that, in our judgment, could adversely affect the City's ability to administer a major
federal program in accordance with the applicable requirements of laws, regulations, contracts
and grants. The reportable condition is described in the accompanying Schedule of Findings
and Questioned Costs in accordance with OMB Circular A-133 as item 01-1.
A material weakness is a condition in which the design or operation of one or more of the
internal control components does not reduce to a relatively low level the risk that noncompliance
with applicable requirements of laws, regulations, contracts and grants that would be material in
relation to a major federal program being audited may occur and not be detected within a timely
period by employees in the normal course of performing their assigned functions. Our
consideration of the internal control over compliance would not necessarily disclose all matters
in the internal control that might be reportable conditions and, accordingly, would not
necessarily disclose all reportable conditions that are also considered to be material weaknesses.
However, we do not believe the reportable condition described above is a material weakness.
This report is intended solely for the information and use of management, the City Council, and
federal oversight and awarding agencies and is not intended to be and should not be used by
anyone other than these specified parties.
K VI.- ^-, ì:XJJ? I(..,t VV I V t..V..L I L.. +cI.
KERN, DEWENTER, VIERE, LTD.
St. Cloud, Minnesota
57
CITY OF ST. JOSEPH, MINNESOTA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
IN ACCORDANCE WITH OMB CIRCULARA-I33
Year Ended December 31, 2002
Section I - Summary of Auditors' Results
Financial Statements
Type of auditors' report issued: Unqualified
Internal control over financial reporting:
· Material weakness( es) identified? No
· Reportable condition(s) identified that are not
considered to be material weakness( es)? Yes
Noncompliance material to financial statements noted? No
Federal A wards
Internal control over major programs:
· Material weakness( es) identified? No
· Reportable condition(s) identified that are not
considered to be material weakness(es)? Yes
Type of auditors' report issued on compliance for
major programs: Unqualified
Any audit findings disclosed that are required to be
reported in accordance with section 510(a) of
Circular A-I33? Yes
Identification of Major Programs
CFDA# 14.228
Name of Federal Program or Cluster Small Cities Development
Program Grant
Dollar Threshold used to Distinguish
between type A and type B programs: $ 300,000
Auditee qualified as low risk auditee? No
58
CITY OF ST. JOSEPH, MINNESOTA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
IN ACCORDANCE WITH OMB CIRCULAR A-I33
Year Ended December 31, 2002
(Continued)
Section II - Financial Statement Findings
Audit Finding 01-1
Criteria or Specific Requirement:
Internal control that supports the City's ability to record, process, summarize, and report
financial data consistent with the assertions of management in the financial statements requires
adequate segregation of accounting duties.
Condition:
The City does not have adequate segregation of accounting duties.
Questioned Costs:
None
Context:
This finding impacts the internal control for all significant accounting functions.
Effect:
The lack of adequate segregation of accounting duties could adversely affect the City's ability to
record, process, summarize, and report financial data consistent with the assertions of
management in the financial statements.
Cause:
There is a limited number of office employees.
Recol1unendation:
Continue to review the accounting system, including changes that may occur. Implement
segregation whenever practical.
Management's Response:
Management agrees with our recommendation.
Section III - Federal Award Findings and Questioned Costs
There were no federal award findings.
There were no questioned costs.
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~DV
KERN·DEWENTER·VIERE
CITY OF ST. JOSEPH, MINNESOTA
AUDITORS' REPORT ON LEGAL COMPLIANCE
February 20,2003
Honorable Mayor and City Council
City of S1. Joseph
S1. Joseph, Minnesota
We have audited the financial statements of the City of S1. Joseph as of and for the year ended
December 31,2002 and have issued our report thereon dated February 20,2003.
We conducted our audit in accordance with auditing standards generally accepted in the United
States of America and the provisions of the Minnesota Legal Compliance Audit Guide for Local
Government, promulgated by the Legal Compliance Task Force pursuant to Minnesota Statutes
Section 6.65. Accordingly, the audit included such tests of the accounting records and such other
auditing procedures as we considered necessary in the circumstances.
The Minnesota Legal Compliance Audit Guide for Local Government covers five main
categories of compliance to be tested: contracting and bidding, deposits and investments,
conflicts of interest, public indebtedness, and claims and disbursements. Our study included all
of the listed categories.
The results of our tests indicate that for the items tested, the City of St. Joseph complied with the
material terms and conditions of applicable legal provisions, except as described in the
accompanying Schedule of Findings and Corrective Action Plans on Compliance with Minnesota
Statutes.
This report is intended solely for the information and use ofthe City's Administration, City
Council, and state and federal awarding and oversight agencies, and is not intended to be, and
should not be, used by anyone other than those specified parties.
K -lA- ^- I Ì)¿M,l-Þvv I V ¿.¿.u., L--I-d.
KERN, DEWENTER, VIERE, LTD.
St. Cloud, Minnesota
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CITY OF ST. JOSEPH, MINNESOTA
FINDINGS AND CORRECTIVE ACTION PLANS ON COMPLIANCE
WITH lYfINNESOTA STATUTES AND INTERNAL CONTROLS
Year Ended December 31, 2002
CURRENT AND PRIOR YEAR INTERNAL CONTROL FINDING:
The City does not have adequate segregation of duties due to a limited number of office
employees.
CORRECTIVE ACTION PLAN (CAP):
1. Explanation of Disagreement with Audit Finding
There is no disagreement with the audit finding.
2. Actions Planned in Response to Finding
City Council will review current segregation of duties to detennine if further segregation
is possible.
3. Official Responsible for Ensuring CAP
Larry Hosch, Mayor, is the official responsible for ensuring corrective action of the
deficiency.
4. Planned Completion Date for CAP
The planned completion date for the CAP is December 31, 2003.
5. Plan to Monitor Completion of CAP
The City Council will be monitoring this corrective action plan.
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CITY OF ST. JOSEPH, MINNESOTA
FINDINGS AND CORRECTIVE ACTION PLANS ON COMPLIANCE
WITH MINNESOTA STATUTES AND INTERNAL CONTROLS
Year Ended December 31, 2002
CURRENT YEAR STATE STATUTE FINDING:
Minnesota Statute Section 118A.03 provide that all deposits with financial institutions must
be collateralized in an amount equal to 11 0% of deposits in excess of FD I C insurance. The
City's deposits at the First State Bank of S1. Joseph were undercollateralized as of
December 31,2002 in the amount of$ 718,954.
CORRECTIVE ACTION PLAN (CAP):
1. Explanation of Disagreement with Audit Finding
There is no disagreement with the audit finding.
2. Actions Planned in Response to Finding
The City will secure the proper level of collateral on all city deposits in order to be in
compliance with Minnesota Statutes.
3. Official Responsible for Ensuring CAP
Larry Hosch, Mayor, is the official responsible for ensuring corrective action of the
deficiency.
4. Planned Completion Date for CAP
The planned completion date for the CAP is December 31, 2003.
5. Plan to Monitor Completion of CAP
The City Council will be monitoring this corrective action plan.
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