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HomeMy WebLinkAbout2002 CAFR COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE CITY OF COLUMBIA HEIGHTS STATE OF MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2002 Prepared By: Finance Department CITY OF COLUMBIA HEIGHTS, MINNESOTA TABLE OF CONTENTS Page Reference No. 1. INTRODUCTORY SECTION Principal City Officials 3 Organizational Chart 5 Letter of Transmittal 7 Certificate of Achievement far Excellence in Financial Reporting 15 II. FINANCIAL SECTION Independent Auditor's Report 19 Management's Discussion and Analysis 23 Basic Financial Statements: Government- Wide Financial Statements: Statement of Net Assets Statement of Activities Statement 1 Statement 2 39 40 Fund Financial Statements: Balance Sheet - Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities Statement of Net Assets - Proprietary Funds Statement of Revenues, Expenses, and Changes in Fund Net Assets - Proprietary Funds Statement of Cash Flows - Proprietary Funds Statement of Fiduciary Net Assets - Fiduciary Funds Statement 3 42 Statement 4 44 Statement 5 47 Statement 6 48 Statement 7 50 Statement 8 52 Statement 9 54 55 Notes to Financial Statements Required Supplementary Information: Budgetary Comparison Schedule - General Fund Budgetary Comparison Schedule - Anoka County CDBG Statement 10 Statement 11 90 92 Budgetary Comparison Schedule - Note to RSI 93 CITY OF COLUMBIA HEIGHTS, MINNESOTA TABLE OF CONTENTS Page Reference No. Combining and Individual Fund Statements and Schedules: Combining Balance Sheet - Nonmajor Governmental Funds Combining Schedule of Revenues, Expenditures and Changes in Fund Balance - Nonmajor Governmental Funds Statement 12 Statement 13 Subcombining Balance Sheet - NOTImajor Special Revenue Funds Subcombining Schedule of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Special Revenue Funds Statement 14 Statement 15 Special Revenue Funds: Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual: Community Development Cable Television Fund Library Fund D.A.R.E. Program Special Projects C.H.A.S.E. Confiscated Property Local Law Enforcement Block Grant COPS MORE 96 Juvenile Justice Grant Statement 16 Statement 17 Statement 18 Statement 19 Statement 20 Statement 21 Statement 22 Statement 23 Statement 24 Statement 25 Statement 26 Statement 27 Statement 28 Statement 29 Statement 30 COPS School Partnership Grant Recreation Contributed Projects Contributed Projects Flex Benefit Fund PolicefFire Contingency Housing and Redevelopment Authority (Component Unit): Combining Balance Sheet Combining Schedule of Revenues, Expenditures and Changes in Fund Balance Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual: Parkview Villa North Parkview Villa South Rental Housing Statement 31 Statement 32 Statement 33 Statement 34 Statement 35 104 105 106 110 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 133 CITY OF COLUMBIA HEIGHTS, MINNESOTA TABLE OF CONTENTS Page Reference No. Statement 38 136 Statement 39 137 Statement 40 138 Statement 41 141 Statement 42 142 Statement 43 147 Statement 44 1551 Economic Development Authority (Component Unit): Combining Balance Sheet Combining Schedule of Revenues, Expenditures and Changes in Fund Balance Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual; Economic Development Authority Administration Business Revolving Loan Fund Section 8 Statement 36 Statement 37 Subcombining Balance Sheet - Nonmajor Debt Service Funds Subcombining Schedule of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Debt Service Funds Subcombining Balance Sheet - Nonmajor Capital Project Funds Subcombining Schedule of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Capital Project Funds Enterprise Funds; Water Utility Fund: Subcombining Schedule of Net Assets Subcombining Schedule of Revenues, Expenditures and Changes in Fund Net Assets Subcombining Schedule of Cash Flows Statement 45 Statement 46 Statement 47 Sewer Utility Fund: Subcombining Schedule of Net Assets Subcombining Schedule of Revenues, Expenditures and Changes in Fund Net Assets Subcombining Schedule of Cash Flows Statement 48 Statement 49 Statement 50 Refuse Utility Fund: Subcombining Schedule of Net Assets Subcombining Schedule of Revenues, Expenditures and Changes in Fund Net Assets Subcombining Schedule of Cash Flows Statement 51 Statement 52 Statement 53 Storm Sewer Utility Fund: Subcombining Schedule of Net Assets Subcombining Schedule of Revenues, Expenditures and Changes in Fund Net Assets Subcombining Schedule of Cash Flows Statement 54 Statement 55 Statement 56 134 135 156 157 158 159 160 161 162 163 164 165 166 167 CITY OF COLUMBIA HEIGHTS, MINNESOTA TABLE OF CONTENTS Page Reference No. Liquor Fund: Subcombining Schedule of Net Assets Statement 57 168 Subcombining Schedule of Revenues, Expenditures and Changes in Fund Net Assets Statement 58 169 Subcombining Schedule of Cash Flows Statement 59 170 Internal Service Funds: Combining Schedule of Net Assets Statement 60 172 Combining Schedule of Revenues, Expenditures and Changes in Fund Net Assets Statement 61 173 Combining Schedule of Cash Flows Statement 62 174 Central Garage Fund: Subcombining Schedule of Net Assets Statement 63 175 Subcombining Schedule of Revenues, Expenditures and Changes in Fund Net Assets Statement 64 176 Subcombining Schedule of Cash Plows Statement 65 177 Energy Management Fund: Statement 66 178 Subcombining Schedule of Net Assets Subcombining Schedule of Revenues, Expenditures and Changes in Statement 67 179 Fund Net Assets Statement 68 180 Subcombining Schedule of Cash Flows Data Processing Fund: Subcombining Schedule of Net Assets Statement 69 181 Subcombining Schedule of Revenues, Expenditures and Changes in Fund Net Assets Statement 70 182 Subcombining Schedule of Cash Flows Statement 71 183 Insurance Fund: Subcombining Schedule of Net Assets Statement 72 184 Subcombining Schedule of Revenues, Expenditures and Changes in Fund Net Assets Statement 73 185 Subcombining Schedule of Cash Plows Statement 74 186 Compensated Absences Fund: Subcombining Schedule of Net Assets Statement 75 187 Subcombining Schedule of Revenues, Expenditures and Changes in Fund Net Assets Statement 76 188 Subcombining Schedule of Cash Flows Statement 77 189 Combining Statement of Fiduciary Net Assets Statement 78 192 CITY OF COLUMBIA HEIGHTS, MINNESOTA TABLE OF CONTENTS Page Reference No. Capital Assets Used in the Operation of Governmental Funds: Schedule By Source Schedule By Function and Activity Schedule of Changes By Function and Activity Statement 79 Statement 80 Statement 81 194 195 196 Supplementary Financial Information: Combined Schedule of Bonds Payable Exhibit 1 198 III. STATISTICAL SECTION (UNAUDITED) Government-Wide Information: Government- Wide Expenses By Function Government-Wide Revenues Table 1 Table 2 202 203 Fund Information: General Governmental Expenditures by Function General Governmental Revenues by Source Tax Levies and Tax Collections Assessed Value, Tax Capacity, and Estimated Actual Value of all Taxable Property Tax Rates City Tax Levy Principal Taxpayers Special Assessment Levies and Collections Computation of Legal Debt Margin Ratio of Net General Obligation Bonded Debt to Assessed Value and Net General Obligation Bonded Debt Per Capita Ratio of Annual Debt Service Expenditures For General Obligation Bonded Debt to Total General Governmental Expenditures Computation of Direct and Overlapping Debt Revenue Bond Coverage: Water, Sewer, and Storm Sewer Funds Property Value and Construction Miscellaneous Statistics Demographic Statistics Table 3 204 Table 4 205 Table 5 206 Table 6 207 Table 7 208 Table 8 209 Table 9 210 Table 10 211 Table 11 212 Table 12 213 Table 13 214 Table 14 215 Table 15 216 Table 16 217 Table 17 218 Table 18 220 CITY OF COLUMBIA HEIGHTS, MINNESOTA TABLE OF CONTENTS Page Reference No. IV. SINGLE AUDIT AND OTHER REQillRED REPORTS SECTION Independent Auditor's Report on Compliance with Minnesota Legal Compliance Audit Guide for Local Governments 223 Independent Auditor's Report on Compliance and on Internal Control over Financial Reporting Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 225 Independent Auditor's Report on Compliance with Requirements Applicable to each Major Program and Internal Control over Compliance in Accordance with OMB Circular A-133 229 Schedule of Findings and Questioned Costs 235 Schedule of Expenditures of Federal Awards 243 Independent Auditor's Report on Supplementary Information - Financial Data Schedule 245 Financial Data Schedule 247 I. INTRODUCTORY SECTION 1 2 CITY OF COLUMBIA HEIGHTS, lVIINNESOTA PRINCIPAL CITY OFFICIALS Year Ended December 31. 2002 Name Official Title Mayor and Council Gary L. Peterson Marlaine Szurek Julienne Wyckoff Bruce Nawrocki Robert A. Williams Mayor Council member Council member Councilmember Councilmember Administration Walter Fehst Linda Magee William Elrite Roxane Smith Larry Scott Jim Hoeft Kevin Hansen Thomas Johnson Charles Thompson Lauren McClanahan Keith Windschitl M. Rebecca Loader City Manager Assistant to City Manager City Clerk-Treasurer, Finance Director Assistant Finance Director Liquor Operations Manager City Attorney Public Works Director, City Engineer Chief of Police Chief of Fire Superintendent of Public Works Recreation Services Director Librarian 3 4 PUBLIC WORKS Public Works Director/City Engineer: Kevin Hansen Secretary II-A Assistant City Engineer Engineering Technician IV Engineering Technician III Engineering Technician II (2) Public Works Superintendent Foreman (3) Maintenance III (1) Ma intenance II (6) Maintenance I (11) Foreman-Vehicle Maintenance Maintenance 111- Mechanic Maintenance 111- Bodyman/Painter Administrative Assistant-Public Works Mayor: Gary L. Peterson POLICE (Administered by Mayor) Police Chief: Thomas Johnson Secretary II Clerk-Typist II Pol ice Captain Sergeants (3) Corporals (3) Patrol Officers (18) Community Service Officers (4) Support Services Supervisor Secretary II-A (2) FIRE Fire Chief: Charles Thompson Secretary II (PT) FT Clerk Typist Assistant Fire Chief Firefighters (6) Volunteer Firefighters (24) LIBRARY Library Director: M. Rebecca Loader Ad ult Services Specialist Ch ildren's Librarian Clerk-Typist 11(2) Library Supervisor (4 PT) Page (8 PT) Library Aide (PT) Library Clerk (PT) City of Columbia Heights Organizational Chart Councilmembers: Bruce Nawrocki Mar/aine Szurek Robert WjJfiams Julienne Wyckoff Commissions & Boards: Charter EDA Police & Fire Civil Service Traffic Telecommunications Planning & Zoning Human Services Park & Recreation Library City Manager: Walter Fehst ADMINISTRATION Assistant to the City Manager Special Projects Coordinator Administrative Secretary Accounting Clerk II-Assessing Clerk Typist II-Administration (PT) Deputy City Clerk/Council Secretary~ RECREATION Recreation Director: Keith Windschit/ Senior Citizen Coordinator Program Coordinator (2) Head Custodian Recreation ClerklTypist 11 Recreation Clerk/Typist II (PT) Custodian II (5 PT) Custodian I (1 PT) FINANCE Finance Director/City Clerk/Treasurer: William Elrite Secretary II (PT) Assistant Finance Director Accounting Coordinator Payroll/Accounting Clerk Utilities Accounting Clerk 11 Utilities Accounting Clerk I Accounting Clerk II (2 PT) Switchboard Operator/Receptionist Meter Reader (PT) Liquor Operations Manager Assistant Liquor Operations Manager (6) Retail Clerk Retail Clerk (20 PT) IS Director IS Technician COMMUNITY DEVELOPMENT Acting Community Development Director: Randy Schumacher Community Development Assistant Building Official Planner Community Development Secretary Secretary II-Permits/License Secretary If-Permits/License (PT) 'Also serves in the capacity of Deputy City Clerk under the City Manager. 5 6 CITY OF COLUMBIA HEIGHTS Finance Denartment Information Systems Financial Reporting Accounts Payable Utility Billing Payroll Fax: (763) 706-3637 590 40th Avenue N.E.. Columbia Heights, MN 55421-3Hn OITicc (763) 706-3600 TDO (763) 706-3692 June 17,2003 To the Citizens of the City of Columbia Heights, Mayor, Councilmembers, and City Manager The Comprehensive Annual Financial Report of the City of Columbia Heights for the fiscal year ended December 31, 2002 is hereby submitted. The responsibility for both the accuracy of the presented data and the completeness and fairness of the presentation, including all disclosures, rests with the City. To the best of our knowledge and belief, the enclosed data is accurate in all material respects and is reported in a manner designed to present fairly the financial position and results of operations of the various funds of the City. All disclosures necessary to enable the reader to gain an understanding of the City's financial activities have been included. The Comprehensive Annual Financial Report is presented in four sections: Introductory, Financial, Statistical, and Other Required Reports. The Introductory Section includes this transmittal letter, the City's organizational chart, a list of principal officials, and a reproduction of the Certificate of Achievement for the prior year. The Financial Section includes: 1) independent auditor's opinion; 2) management's discussion and analysis; 3) government wide and fund financial statements; 4) notes to the financial statements; 5) required supplemental information; 6) combining and individual fund statements and schedules; and, 7) the supplemental financial information. The Statistical Section includes tables and reports of various economic, social, financial and fiscal data designed to reflect trends and ratios. The City is required to undergo an annual single audit in conformity with the provisions of the Single Audit Act of 1984 and the United States Office of Management and Budget Circular A~ 133 and a Minnesota Legal Compliance Audit. Information related to this single audit and compliance audit, including the Schedule of Expenditures of Federal A wards, is included in the Single Audit and Other Required Reports Section. Generally accepted accounting principals require that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management's Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The City of Columbia Heights' MD&A can be found immediately following the report of the independent auditors. All City funds, departments, commissions and other organizations for which the City of Columbia Heights is financially accountable are presented within the Comprehensive Annual Financial Report. The City provides a full range of services to its citizens. These services include, but are not limited to, police and fire protection~ sanitation services; the construction and maintenance of highways, streets, and infrastructure; library; recreational facilities; cultural events; and general administrative services. The Housing and Redevelopment Authority (HRA) Service Is Our Business THE CITY OF COLUMBIA HEIGHTS DOES NOT DISCRIMINATE ON THE BASIS OF DISABILITY IN EMPLOYMENT OR THE PROVISION OF SERVICES EQUAL OPPORl)'NITY EMPLOYER 8 and the Economic Development Authority (EDA) are included in the reporting entity as component units of the City of Columbia Heights due to the fact that the governing boards are substantively the same and the City is in a relationship of financial benefit or burden with the authorities. In June, 1999, the Governmental Accounting Standards Board (GASB) issued Statement 34. This standard is the most comprehensive governmental accounting rule ever developed. This standard substantially changes the way state and local governments report their financial activity. The City of Columbia Heights has implemented these changes for 2002. A summary of the most significant changes are as follows: 1. Government-wide financial statements are prepared using full accrual accounting. 2. Basic fund financial statements present m~or funds instead of fund types. 3. Budgetary comparisons include original and amended budgets. 4. All infrastructure has been capitalized and all capital assets are depreciated. 5. A management discussion and analysis is included as required supplemental information. ECONOMIC CONDITION AND OUTLOOK The City of Columbia Heights, which is a suburb located north of the City of Minneapolis in Anoka County in east-central Minnesota, was originally incorporated as a village in 1898. In 1921, pursuant to the adoption of a home rule City Charter by the qualified voters of the City, a council-manager form of government, was instituted. The City covers an area of 3.52 square miles and has a population of 18,520. As an older, fully developed suburb of the City of Minneapolis, the management and the residents of the City of Columbia Heights are faced with the problems of an aging infrastructure and with increased crime statistics. The City Council and City Management are taking a proactive approach in dealing with these concerns. The City Council has approved several projects related to the redevelopment of the downtown area of Columbia Heights. The projects include the Central Avenue Street, Utility and Streetscape Improvement Project; the Transit Hub; the Master Redevelopment Plan with the "Town Square Concept"; and the Transition Block Redevelopment Project consisting of 22 townhomes and 50 units of senior living facilities. These projects are greatly improving the downtown area of Columbia Heights and will be completed within the next year. The City has a planned Street Rehabilitation Program including water mains and storm sewer improvements. Zone 5 was completed in 2001, Zone 6A completed in 2002, Zone 6B will continue throughout 2003 and Zone 7 will start in 2004. The second phase of Storm Water Management Improvements continued during 2002. The Police Department continued to apply for, and receive, federal and state grants to assist in their community policing efforts. 9 The completion of Medtronic Corporation's expansion has resulted in continuing additional job opportunities in the City. Overall, unemployment in the City has increased slightly due to the economic downturn, but is still well below the national unemployment rate average. The City is actively promoting the expansion and creation of new businesses in the City by providing loans to qualified businesses through the HRA Business Revolving Loan Fund. MAJOR INITIATIVES For the Year The City had many major accomplishments during 2002. The following list is a summary of some of the major initiatives competed throughout the year. 1) The installation of City View software. This software is a interdepartmental database system. CityView provides automation of important business processes, including special assessments, building permits and inspections, human resources, business licenses, and fire protection. It also allows the updating of property information by using the County database and integrates property data with GIS. 2) The implementation of Governmental Accounting Standards Board Statements 33, 34, 36, 37, 38, 39, and 40. 3) Community policing continued to be a very important part of the police department's mission. Programs such as neighborhood picnics, rental property owners meeting, McGruff House program, graffiti cleanup programs, and sector community policing continue to be important to our residents. 4) The completion of bidding, construction, and contract administration of the Central A venue Street, Utility and Streetscape improvement Project. 5) The completion of Zone 6A Street Rehabilitation Project including major watermain improvements and storm sewer improvements along Washington and Madison streets. 6) Additional storm wat.er management improvements continued with the aut.horization of the acquisition of two single-family homes for demolition and site grading in a flood prone area along the 3900 block of Van Buren. This work was made possible by securing a grant through a DNR grant matching 50% of the total acquistion and construction costs. 7) All other flood mitigation projects were finalized in 2002 with over $425,000 of DNR grant funds disbursed to the Cit.y. 8) The utility department complet.ed a major cleaning and televising program to analyze problem areas within the sanitary sewer system in preparation for Zone 6A and Zone 6B street rehabiliation areas. 9) The installation of a client-server platform for the library's automated circulation system. 10) Contracted with a planning firm to develop the master plan for the redevelopment of the industrial park. 10 11) Purchased property for the redevelopment of 40tl1 and University. This results in an approximate site of over one acre available for development 12) Purchased property for the redevelopment of 37111 and Central. Combined, these purchases result in a highly visable, large commercial property along the City's central business route. For the Future The Public Works Department will complete the Central A venue Street, Utility and Streetscape Improvement Project in 2003. This project will provide a 4.7 million dollar investment along Central A venue from 371}. to 43"\ including the core downtown area. The Master Redevelopment Plan for the downtown of Columbia Heights established a "Town Square Concept". The intent of the town square concept is to create a new mixed-use district on 40lh A venue west of Central A venue. This, along with the Central A venue Street, Utility and Streetscape Improvement Project, will continue to improve the downtown area of Columbia Heights. These plans combine new centralized civic uses, new public open space, commercial development, and a new downtown multi-family residential development into a revitalized center. These projects will be completed in 2003. In addition, Zone 6B Street Rehabilitation is scheduled to start in 2003. This project will include water main and storm sewer improvements as well as the street rehabilitation. City View software installation will continue throughout 2003, with the anticipated date of completion for the special assessments, building permits, building maintence work orders, and fire module component in 2003. During 2003, the purchase order module will be developed for a 2004 implementation. The redevelopment of the industral park will continue throughout 2003. The planning firm of Hoisington Koegler and developer United Properties are currently creating a redevelopment plan for the park. This plan will be presented to the Council during 2003 and will commence with the redevelopment shortly after. In August of 2002, the City of Columbia Heights approved the site plan, and preliminary and final plats for Parks ide Village, a 2.5 acre, 25-unit market-rate townhome project on 51 SI A venue adjacent to Sullivan Lake and park. These units have an initial sale price of $260,000. Financial Information Management of the City of Columbia Heights is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the City are protected from loss, theft or misuse and to ensure that adequate accounting data is compiled to allow for the. preparation of financial statements in conformity with generally accepted accounting principles. The internal control structure is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that: 1) the cost of a 11 control should not exceed the benefits likely to be derived; and 2) the valuation of costs and benefits requires estimates and judgments by management. In addition, the government maintains extensive budgetary controls. The objective of these controls is to ensure compliance with legal provisions embodied in the annual appropriated budget approved by the City Council. Activities of the general fund and certain special revenue funds are included in the annual appropriated budget. The level of budgetary control and the level at which expenditures cannot legally exceed the appropriated amount is at the fund level. As demonstrated by the statements and schedules included in the financial section of this report, the City continues to meet its responsibility for sound financial management. Cash Management Cash temporarily idle during the year was invested in demand deposits, certificates of deposit, obligations of the U.S. Treasury, repurchase agreements, and commercial paper. The average yield on investments for the year was 6.77%, which includes both interest revenue of 5.44% and the change in fair market value of 1.34%. The City's investment policy is to minimize credit and market risks while maintaining a competitive yield on its portfolio. Accordingly, deposits were either insured by federal depository insurance or collateralized. Risk Management The City maintains commercial insurance coverage for liability, property, liquor liability, and workers' compensation. The City maintains an internal service fund for insurance. The insurance fund maintains a reserved balance to provide funds for catastrophic losses. This fund charges individual departments for allocation of premiums and for claims incurred. There were no significant claims pending at year-end for the City. OTHER INFORMATION Independent Audit State Statutes require an annual audit by independent certified public accountants. The accounting firm of HLB Tautges Redpath, Ltd. was selected by the City. In addition to meeting the requirements set forth in State Statutes, the audit was also designed to meet the requirements of the Federal Single Audit Act of 1984 and related OMB Circular A-133. The auditor's report on the basic financial statements and combining and individual fund statements and schedules is included in the Financial Section of this report. 12 Awards The Government Finance Officers' Association (GFOA) of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Columbia Heights, Minnesota for its Comprehensive Annual Financial Report for the year ended December 31, 2001. The Certificate of Achievement is a prestigious national award that recognizes conformance with the highest standards for preparation of state and local government financial reports. In order to be awarded a Certificate of Achievement, a government unit must publish an easily readable and efficiently organized Comprehensive Annual Financial Report whose contents conform to program standards. The CAFR must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe our current report continues to conform to the Certificate of Achievement program requirements, and we are submitting it to the GFOA. Acknow lede:ments The preparation of the Comprehensive Annual Financial Report on a timely basis was made possible by the dedicated service of the entire staff of the Finance Department. Each member of the department has our sincere appreciation for the contributions made in the preparation of this report. In closing, without the leadership and support of the City Manager and City Council, preparation of this report would not have been possible. Sincerely, t:J~~tLr William J. EJrite Finance Director ?7~ .-J~ Roxane M. Smith Assistant Finance Director 13 14 Certificate of Achievement for Excellence in Financial Reporting Presented to City of Columbia Heights, Minnesota For its Comprehensive Annual Financial Report for the Fiscal Year Ended December 31, 2001 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting. ~~~ President jJ#-7-/~ Executive Director 15 16 II. FINANCIAL SECTION 17 18 Tautges Redpath, Ltdm Certified Public Accountants and Consultants INDEPENDENT AUDITOR'S REPORT To the Honorable Mayor and Members of the City Council City of Columbia Heights, Minnesota We have audited the accompanying financial statements of the governmental activities, the business type activities, each major fund, and the aggregate remaining fund information of the City of Columbia Heights, Minnesota, as of and for the year ended December 31, 2002 which collectively comprise the City's basic financial statements as listed in the table of contents. These financial statements are the responsibility of the City of Columbia Heights, Minnesota's management. Our responsibility is to express an opinion on these basic 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, cvidence 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 opinions. In aUf opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Columbia Heights, Minnesota, as of December 31, 2002, and the respective changes in financial position and cash flows, where applicable, thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America. As described in note 14, the City of Columbia Heights, Milmesota has implemented a new financial reporting model, as required by the provisions of GASB Statement No. 34, Basic Financial Statements and Management's Discussion and Analysis for State and Local Governments, as of December 31, 2002. White Bear Lake Office: 481 0 White Bear Parkway, White Bear Lake, MN 55110, USA Telephone: 651 4267000 Fax: 651 426 5004 Hastings Office: 1303 South Frontage Road, Suite 13, Hastings, MN 55033, USA Telephone: 651 4804990 Fax: 651 4265004 HLB Tautges Redpath, Ltd. is a member of .International. A world-wide organization of accounting firms and business advisors. 19 20 In accordance with Government Auditing Standards, we have also issued a report dated April 9, 2003 on our consideration of the City of Columbia Heights, Minnesota's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit. The Management's Discussion and Analysis and the budgetary information on pages 23 through 35 and 90 through 93, respectively, are not a required part of the basic financial statements but are supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the supplementary information. However, we did not audit the information and express no opinion on it. Our audit was made for the purpose of forming opinions on the financial statements that collectively comprise the City of Columbia Heights, Minnesota's basic financial statements. The accompanying schedule of expenditures of federal awards as required by U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non- Profit Organizations, along with the introductory section, combining and individual fund statements and schedules, supplementary financial information and statistical information as listed in the table of contents are presented for purposes of additional analysis and are not a required part of the basic financial statements of the City of Columbia Heights, Minnesota. Such information, except for that portion marked "unaudited," on which we express no opinion, has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects, in relation to the basic financial statements taken as a whole. April 9, 2003 (ft~ ~ ~I {[J. HLB TAUTGES REDPATH, LTD. Certified Public Accountants 21 22 MANAGEMENT'S DISCUSSION AND ANALYSIS As management of the City of Columbia Heights, we offer readers of the City of Columbia Heights' financial statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended December 31,2002. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal, which can be found on pages 7 through 13 of this report. Prior period comparatives are not included in this analysis as 2002 is the first year for reporting under GASB Statement Number 34. Financial Hi2:hIi2:hts The assets of the City of Columbia Heights exceeded its liabilities at the close of the most recent fiscal year by $48,770,743 (net assets). Of this amount, $24,563,347 (unrestricted net assets) may be used to meet the government's ongoing obligations to citizens and creditors in accordance with the City's fund designations and fiscal policies. The City's total net assets increased by $6,452,078. As of the close of the current fiscal year, the City of Columbia Heights' governmental funds reported combined ending fund balances of $17,948,302. At the end of the current fiscal year the general fund balance of $3,515,606, included $14,657 reserved and $3,500,949 designated for working capital. The City's total debt decreased by $891,515 during the current fiscal year, from $5,254,721 to $4,363,206. Overview of the Financial Statements The discussion and analysis are intended to serve as an introduction to the City of Columbia Heights' basic financial statements. The City's basic financial statements comprise three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. Government-wide financial statements. The government-wide financial statements are designed to provide readers with a broad overview of the City of Columbia Heights' finances, in a manner similar to a private-sector business. The statement of net assets presents information on all of the City of Columbia Heights' assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the City of Columbia Heights is improving or deteriorating. 23 Management's Discussion and Analysis The statement of activities presents information showing how the City's net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g. uncollected taxes and earned but unused vacation leave). Both of the government-wide financial statements distinguish functions of the City of Columbia Heights that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City of Columbia Heights include general government, public safety, public works, culture and recreation and community development. The business-type activities of the City of Columbia Heights include water, sanitary sewer, refuse, storm sewer and liquor operations. The government-wide financial statements can be found on pages 39 through 41 of this report. Fund Financial statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City of Columbia Heights, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City of Columbia Heights can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds. Governmental funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the govemment-wide financial statements. However, unlike the govemment-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spend-able resource, as well as on balances of spend-able resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financial requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the govemment-wide financial statements. By doing so, readers may better understand the long-term impact of the City's near term financial decisions. Both the governmental fund balance sheet and governmental fund statement of revenues, expenditures, and change in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. 24 Management's Discussion and Analysis For the current fiscal year ended December 31, 2002, the City of Columbia Heights has seven individual major governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the general fund, Anoka County community development block grant fund, municipal state aid street fund, Sheffield tax increment financing fund, capital improvements-general government buildings fund, capital equipment replacement-general government fund, and capital improvements-PIR fund all of which are required to be presented as major funds. Data from the other governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these non-major governmental funds is provided in the form of combining statements elsewhere in this report. The City of Columbia Heights adopts an annual appropriated budget for its general and some special revenue funds. A budgetary comparison statement has been provided for those funds to demonstrate compliance with this budget. The basic governmental fund financial statements can be found on pages 42 through 47 of this report. Proprietary funds. The City of Columbia Heights maintains two different types of proprietary funds. Enterprise funds are used to report the same functions presented as business-type activities in the governmental-wide financial statements. The City of Columbia Heights uses enterprise funds to account for its water, sanitary sewer, refuse, storm sewer, and liquor operations. Internal service funds are an accounting device used to accumulate and allocate costs intenlally among the City-of Columbia Heights' various functions. The City of Columbia Heights uses internal service funds to account for it's central garage, energy management, data processing, insurance, and compensated absences services. Because the central garage, energy management, insurance and compensated absences services predominately benefit governmental rather than business-type functions, they have been included within governmental activities in the government-wide financial statements. And also, because the data processing services predominately benefit the business-type functions, it has been included within the business-type activities in the government-wide financial statements. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for the water, sanitary sewer, refuse, storm sewer and liquor operations, all of which are considered to be major funds of the City of Columbia Heights. Conversely, the internal service funds are combined into a single, aggregated presentation in the proprietary fund financial statements. Individual fund data for the internal service funds is provided in the form of combining statements elsewhere in this report. 25 Management's Discussion and Analysis The basic proprietary fund financial statements can be found on pages 48 through 53 of this report. Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support the City of Columbia Heights' own program. The accounting used for fiduciary funds is much like that used for proprietary funds. The basic fiduciary fund financial statement can be found on page 54 of this report. Notes to the financial statements. The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found on pages 55 through 87 of this report. Other information. The combining statements referred to earlier in connection with non- major governmental funds are presented immediately following the required supplementary information on budgetary comparisons. Combining and individual fund statements and schedules can be found on pages 104 through 192 of this report. Government-wide Financial Analvsis As noted earlier, net assets may serve over time as a useful indictor of a government's financial position. In the case of the City of Columbia Heights, assets exceeded liabilities by $48,770,743 at the close of the most recent fiscal year. The largest portion of the City of Columbia Heights' net assets ($22,828,090 or 48.1 percent) reflects its investment in capital assets (e.g. land, buildings, improvements, furniture and fixtures, machinery and equipment and infrastructure) less any related debt llsed to acquire those assets that is still outstanding. The City of Columbia Heights uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City of Columbia Heights' investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. With the first year implementation of Governmental Accounting Standards Board Statement 34, the City is not presenting comparable columns in the various comparisons and analyses for the previous year. Comparative information will be provided in future years. 26 Management's Discussion and Analysis CITY OF COLUMBIA HEIGHTS' NET ASSETS Governmental Business-Type Activities Activities Total Current and other assets $22,960,131 $8,788,412 $31,748,543 Capital assets 18,059,465 7,161,531 25,220,996 Total assets 41,019,596 15,949,943 56,969,539 Long-tenn liabilities outstanding 2,806,854 1,530,064 4,336,918 Other liabilities 2,850,030 1,011,848 3,861,878 Total liabilities 5,656,884 2,541,912 8,198,796 Net assets: Invested in capital assets, net of related debt 17,354,465 5,473,625 22,828,090 Restricted 1,203,523 175,783 1,379,306 Unrestricted 16,804,724 7,758,623 24,563,347 Total net assets $35,362,712 $13,408,031 $48,770,743 A portion of the of the City of Columbia Heights' net assets represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net assets ($24,563,347) may be used to meet the City's ongoing obligations to citizens and creditors. At the end of the current fiscal year, the City of Columbia Heights is able to report positive balances in all three categories of net assets, both for the government as a whole, as well as for its separate governmental and business-type activities. 27 Management's Discussion and Analysis Governmental activities Governmental activities increased the City of Columbia Heights' net assets by $6,006,494, accounting for 93% of the total growth in net assets. Key elements of this increase are as follows: . City of Columbia Heights' Changes in Net Assets Governmental Business-Type Activities Activities Total Revenues: Program revenues: Charges for services $1,788,842 $10,917,906 $12,706,748 Operating grants and contributions 1,218,659 53,978 1,272,637 Capital grants and contributions 4,510,229 130,339 4,640,568 General revenues: Property taxes 4,341,972 4,341,972 Other taxes 798,446 798,446 Grants and contributions not restricted to specific programs 3,275,417 3,275,417 Unrestricted investment earnings 1,201,447 375,624 1,577,071 Gain on disposal of capital assets 6,454 6,454 Total revenues 17,141,466 11,477,847 28,619,313 Expenses: General government 1,915,920 1,915,920 Public safety 3,920,746 3,920,746 Public works 1,659,152 1,659,152 Culture and recreation 2,018,571 2,018,571 Community development 1,679,107 1,679,107 Interest on long-term debt 575,712 575,712 Water 1,561,071 1,561,071 Sewer 1,058,721 1,058,721 Refuse I ,271 ,961 1,271,961 Storm sewer 162,499 162,499 Liquor 6,343,775 6,343,775 Total expenses 11,769,208 10,398,027 22,167,235 Increase in net assets before transfers 5,372,258 1,079,820 6,452,078 Transfers 634,236 (634,236) Increase in net assets 6,006,494 445,584 6,452,078 Net assets - beginning 29,356,218 12,962,447 42,318,665 Net assets - ending $35,362,712 $13,408,03 I $48,770,7 43 28 Management's Discussion and Analysis Below are specific graphs providing comparisons of the governmental activities revenues and expenditures: Governmental Activities - Revenues Grants and contributions not restricted to specific programs 19% Unrestricted investment earnings 7% Charges for services 10% Operating grants and contributio ns 7% Other taxes 5% Capital grants and contributions 27% Property taxes 25% Governmental Activities - Expenses Community development 14% Interest on long-term debt 5% General government 16% Culture and recreation 17% Public works 14% Public safety 34% 29 Management's Discussion and Analysis Business-Type Activities Business-type activities increased net assets by $445,584 accounting for 7% of the City of Columbia Heights' growth in net assets. Below are graphs showing the business-type activities revenue and expense comparisons: Business-Type Activities - Revenues Capital grants and contributions 1% Unrestricted investment earnings 3% Charges for services 96% Business-Type Activities - Expenses Water 15% Liquor 61% Sanitary sewer 10% Refuse 12% Storm sewer 2% 30 Management's Discussion and Analysis Financial Analvsis of the Government's Funds As noted earlier, the City of Columbia Heights uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. Governmental Funds. The focus of the City of Columbia Heights' governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City of Columbia Heights' financing requirements. In particular, unreserved fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year. At the end of the current fiscal year, the City of Columbia Heights' governmental funds reported combined ending fund balances of$17,948,302. Approximately 94 percent of this total amount ($16,982,832) constitutes unreserved fund balance. The remainder of the fund balance ($965,470) is reserved because it has already been committed 1) to provide for prepaid items ($18,813), 2) to provide for real estate held for resale ($165,836), 3) for grant restricted program expenditures ($780,821). The general fund is the chief operating fund of the City of Columbia Heights. At the end of the current year, the fund balance decreased in total by $381,770 in 2002. The revenues exceeded the expenditures at year-end by $879,754. The City Council authorized a transfer of funds to the capital improvements - general government buildings fund, thus reducing the fund balance. The Anoka County CDBG fund decreased in total by $38,624 due to the purchase of several development properties during 2002. The municipal state aid street fund decreased by $1,030,591 due to the Central A venue streetscape project. The Sheffield tax increment financing redevelopment fund decreased by $490,518 due to the separation of the Sheffield capital fund and the Sheffield tax increment financing redevelopment fund. The capital improvements general government buildings fund increased by $1,463,563 due predominately to the transfers from the general fund for future capital expenditures. The capital equipment replacement general government fund increased by $510,983 due partially to investment income and to transfers from the police/fire contingency funds. The capital improvements PIR fund increased by $231,438 due to the funding of closed city projects. The non major special revenue funds decreased by $ 1,325,641 for 2002 due in part to the transfers to the capital improvements development fund for redevelopment. 31 Management's Discussion and Analysis The debt service funds decreased by $365,280 due to the debt service payments exceeding the tax increment revenues. The capital project funds increased overall by $1,909,360 due to the funding of future capital improvements by transfers from the general and special revenue funds. Proprietary funds. The City of Columbia Heights' proprietary funds provide the same type of information found in the government-wide financial statements, but in more detaiL The unrestricted net assets in the respective proprietary funds are water ($241,345), sanitary sewer $3,771,350, refuse $704,659, storm sewer $198,206 and liquor $2,859,178. The sanitary sewer, storm sewer and liquor funds had increases in net assets in 2002 of$202,455, $139,462 and $412,886 respectively. The water and refuse funds had decreases in net assets of$275,477 and $125,611 respectively. Bud2etarv Hie:hlie:hts General Fund Differences between the original budget and the final amended budget are relatively minor ($31,562) and can be briefly summarized as increases allocated to the police department for police protection services provided to entities outside of the City. This increased budget amount was funded out of increases in police charges for services. Caoital Asset and Debt Administration Capital assets. The City of Columbia Heights' investment in capital assets for its governmental and business type activities as of December 31,2002, amounts to $25,220,996 (net of accumulated depreciation). This investment in capital assets includes land, buildings, improvements other than buildings, office furniture and fixtures, machinery and equipment, infrastructure and construction in progress. Major capital asset events during the current fiscal year included the following: @I Construction continued on the Central A venue project, construction in progress as of the close of the year had reached $4,370,464. oZone 5, street rehabilitation was completed and closed in 2002, the total cost was $1,455,456. ED Construction on Zone 6, street rehabilitation continued throughout 2002, the construction in progress as of the close of the year had reached $1,282,862. 32 Management's Discussion and Analysis City of Columbia Heights' Capital Assets (Net of Depreciation) Infra<itructurel Internal Beginning Constroction Service Used Ending Primary (iQve~nt Balance In Progress Pr-inmily Additioos Deleti ons Adj us1:In'.nts Balance Gov~ntaJ Activities: llmd $3,8511,053 $ - $ - $ .. $ - ($773,367) $3,082,686 Bui]dings and structure;; 8,741.782 - 371,383 259,358 - 781,114 10,153,637 Irrpmm"I:I1ts 3,594,858 - 119,847 371,593 - (1,108,902) 2,977,3% Officc furniture and fixtures .. .. - 24,674 - 228,778 253,452 Machinery and cquipnUlt 7,158,117 .. 77,044 831,730 6, ()(){) (3,615,878) 4,445,013 Infrastructure - 8,182,009 - 1,021,254 .. - 9,203,263 Construction ill progress - 2,927,422 - 5,303,029 2,531,231 - 5,699,220 Total capital a=ts 23,350,810 11,109,431 568,274 7,811,638 2,537,231 (4,488,255) 35,814,667 Less accwnuated dq1fcciation: ACCUIn.llated dep-eciation 16,512,127 0 408,455 !:G4,620 0 0 17,755,202 Go~mnenrnl acitivities capital as&ts -net 6,IG8,683 11,109,431 159,819 6,977,0]8 2,537,231 ( 4,488,255) 18,059,465 Business-Type Activities: llmd 86,169 - - 254,724 .. - 340,893 Buildings and structures 707,861 - - - - (47,116) 660,745 hqJfO\1;:Il-ents 10,15\,\ 84 - - 523,522 - (lO3,940) 10,570,766 Office furniture and fixtures ] 35,778 - - - - (54,764) 8],014 Machinery and equipnUlt 1,242,562 - 26,140 .. - (230,703) 1,037,999 Construction in progress 293,750 - - 527,049 782,893 - 37,906 Totm capirnl assets 12,617,304 0 26,140 1,305,295 782,H93 (43!i,523) 12,729,323 l..L><;.~ accwl1.llatcd depreciation: Accwnlatcd dcprt.'Ciation 5,198,727 0 18,737 350,328 0 0 5,567,792 Bll'iincss-tyr.c acitivitics capital asset'i -IlL't 7,418,577 0 7,403 954,967 782,893 {436,523} 7,16 \,531 Total capital as.<:cts - net $14,257,260 $11,109,431 $167,222 $7,931,985 $3,320,] 24 ($4,924,778) $25,220,996 Additional information on the City of Columbia Heights' capital assets can be found in Note 4. 33 Management's Discussion and Analysis Long-term debt. At the end of the current fiscal year, the City of Columbia Heights had total long-term debt outstanding of $4,363,206, a decrease of $891 ,515 from 2002. $705,000 is for general obligation improvement debt supported in part by special assessments. An additional $2,008,206 of general obligation tax increment debt financed the City's economic development program, and $1,650,000 of general obligation utility revenue bonds financed utility improvements. In addition, there is long-term debt in the amount of $631,574 for compensated absences. City of Columbia Heights' Outstanding Debt General Obligation Improvement Bonds, General Obligation Tax Increment Bonds, Long- Term Notes and Compensated Absences General Obligation I mprovement Bonds General Obligation Tax Increment Bonds Revenue Bonds Compensated absences Total Governmental Activities $705,000 2,008,206 Business-Type Activities $ 571,566 $3,284,772 1,650,000 60,008 $1,710,008 Total $705,000 2,008,206 1,650,000 631,574 $4,994,780 The City of Columbia Heights maintains an A 1 rating from Moody's. State statute limits the amount of general obligation debt a Minnesota city may issue to 2% of total Estimated Market Value. The current debt limitation for the City of Columbia Heights is $15,506,730. Only $2,355,000 of the City's outstanding debt is counted within the statutory limitation. Additional information on the City of Columbia Heights' long-term debt can be found in note 7 on pages 75-79 of this report. Economic Factors and Next Year's Budgets and Rates The unemployment rate for the City of Columbia Heights is currently 4.4 percent, which is an increase from a rate of 3.4 percent a year ago. This compares to the state's average unemployment rate of 4.4 percent and the national average rate of 5.8 percent. Inflationary trends in the region compare favorab ly to national trends. All of these factors were considered in preparing the City of Columbia Heights' budget for the 2003 fiscal year. 34 Management's Discussion and Analysis Requests for information. This financial report is designed to provide a general overview of the City of Columbia Heights' finances for all those with an interest in the government's finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the City of Columbia Heights- Finance Department, 590 40th Avenue NE, Columbia Heights, Minnesota 55421-3878. 35 36 BASIC FINANCIAL STATEMENTS 37 38 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF NET ASSETS December 31,2002 Statement 1 Primary Government Governmental Business- Type Assets Activities Activities Total Current assets: Cash and cash equivalents $20,524,203 S5,924,909 $26,449,112 Receivables: Accounts (net of allowance for uncollectables) 111,361 864,343 975,704 Special assessments 1,186,193 1,186,193 Taxes 122,776 122,776 Interest 210,032 63,896 273,928 Loans 10,433 10,433 Due fTOm other governmental units 811,881 38,521 850,402 Internal balances (505,133) 505,133 Prepayments 31 ,290 31 ,2 90 Inventory, at cost 66,359 1,191,527 J,257,886 Real estate held for resale 390,736 390,736 Total current assets 22,960,131 8,588,329 31,548,460 Noncurrent assets: Due from other governmental units 200,083 200,083 Capital assets: Land 3,082,686 340,893 3,423,579 Buildings 10,153,637 660,745 10,814,382 Improvements other than buildings 2,977,396 c 10,570,766 13,548,162 Office furniture and fixtures 253,452/ 81,014 334,466 Machinery and equipment 4,445,013 1,037,999 5,483,012 Infrastructure 9,203,263 9,203,263 Construction in process 5,699,220 37,906 5,737,126 Total capital assets 35,814,667 12,729,323 48,543,990 Less: accwnulated depreciation (17,755,202) (5,567,792) (23,322,994) Total capital assets (net of accumulated depreciation) 18,059,465 7,161,531 25,220,996 Total noncurrent assets 18,059,465 7,361,614 25,421,079 Total assets 41,019,596 15,949,943 56,969,539 Liabilities Current liabilities: Accounts payable 1,667,119 464,755 2,131,874 Accrued salaries and withholdings payable 104,673 18,386 123,059 Contracts payable - retained percentage 209,887 209,887 Due to other governmental units 142,298 315,611 457,909 Unearned revenue 28,017 28,017 Accrued interest payable 193,614 27,602 221,216 Deposits 25,780 3,744 29,524 Compensated absences payable - current 724 1,806 2,530 Bonds payable - current 477,918 180,000 657,9J 8 Total current liabilities 2,850,030 1,0 II ,904 3,861,934 Noncurrent liabilities: Compensated absences payable - noncurrent 571,566 60,008 631,574 Bonds payable - noncurrent 2,235,288 1,470,000 3,705,288 Total noncurrent liabilities 2,806,854 1,530,008 4,336,862 TotalliabiIities 5,656,884 2,541,912 8,198,796 Net Assets Invested in capital assets, net of related debt 17,354,465 6,480,071 23,834,536 Restricted for: Debt service 175,783 175,783 Public safety 704,960 704,960 Culture and recreation 49,487 49,487 Community development 449,076 449,076 Unrestricted 16,804,724 6,752,177 23,556,901 Total net assets $3) ,36l, III $13,40~,031 $4~,770,74::; The notes to the financial statements are an integral part of this statement. 39 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF ACTIVITIES For The Year Ended December 31, 2002 Functions/Programs Expenses Primary government: Government activities: General government Public safety Public works Culture and recreation Community development Interest on long-term debt Total government acti vities $1,915,920 3,920,746 1,659,152 2,018,57l 1,679,107 575,712 11,769,208 Business-type activities: Water Sewer Refuse Storm sewer Liquor Total business-type activities 1,561,071 1,058,721 1,271,961 162,499 6,343,775 10,398,027 Total primary government $22,167,235 The notes to the financial statements are an integral part of this statement. 40 Charges For Services $594,983 290,465 168,608 233,498 501,288 1,788,842 1,391,669 1,220,936 1,248,982 172,975 6,883,344 10,917,906 $12,706,748 Statement 2 Program Revenues Operating Grants and Contributions Capital Grants and Contributions Governmental Activities Net (Expense) Revenue and Changes in Net Assets Primary Government B llsiness~ Type Activities Total $2,688 $ ($1,318,249) $ ($l,318,249) 387,828 (3,242,453) (3,242,453) 161,384 4,043,856 2,714,696 2,714,696 l40,938 (1,644,135) (1,644,135) 525,821 466,373 (185,625) (185,625) (575,712) (575,712) 1,218,659 4,510,229 (4,251,478) 0 (4,251,4 78) (169,402) (169,402) 198 162,413 162,413 53,780 30,80 I 30,801 ! 30,339 140,815 140,815 539,569 539,569 53,978 130,339 0 704,196 704,196 $1,272,637 $4,640,568 ($4,251,478) $704,196 ($3,547,282) General revenues: Property taxes $4,341,972 $ $4,341,972 Tax increment collections 798,446 798,446 Grants and contributions not restricted to specific programs 3,275,417 3,275,417 Unrestricted investment earnings 1,201,447 375,624 1,577.071 Gain (loss) on disposal of capital asset 6,454 6,454 Transfers 634,236 (634,236) Total general revenues and transfers 10,257,972 (258,612) 9,999,360 Change in net assets 6,006,494 445,584 6,452,078 Net assets ~ beginning 29,356,218 12,962,447 42,318,665 Net assets - ending $35,362,712 $13,408,031 $48,770,743 The notes to the financial statements are an integral part of this statement. 41 CITY OF COLUMBIA HEIGHTS, MINNESOTA BALANCE SHEET GOVERNMENTAL FUNDS December 31, 2002 Municipal General Anoka County State Aid Assets Flll1d CDBG Street Fund Cash and investments $3,167,454 $ - $193,991 Receivables: Accounts 11,817 49,004 Special assessments Taxes I OS ,368 Interest 59,086 Loans Due from other governmental units 64,111 239,393 226,919 lnterfund receivable 437,580 Prepayments 14,657 Real estate held for resale 224,900 Total assets $3,860,073 $464,293 $469,914 Liabilities and Fund Balances Liabilities: Accounts payable $79,980 $ - $1,038,128 Accrued salaries and withholdings payable 89,6]9 206 Contracts payable - retained percentage 155,253 Due to other governmental units 97,227 2,031 Interfimd payable 263,710 Deferred revenue 74,841 224,900 Deposits 2,800 1,000 Total liabilities 344,467 489,610 1,195,618 Fund balances: Reserved: Reserved for prepayments 14,657 Reserved for real estate held tor resale Reserved for program expendi tures Unreserved, reported in: General fund 3,500,949 Special revenue funds (25,317) Debt service funds Capital projects fund (725,704) Total fund balances 3,515,606 (25,317) (725,704) Total liabilities and flmd balance $3,860,073 S464,293 S469,914 The notes to the financial statements are an integral part of this statement 42 Statement 3 $1,482 $2,991,038 $4,554,326 $1,209,370 $ - $ $485 $ - 2,427 13 53,62 1 492,000 155,321 1,184,427 492,000 13 485 1,395,796 Amounts reported for governmental activities in the statement of net assets are different because: Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds. Other long-term assets are not available to pay for current-period expenditures and, therefore, are deferred in the funds. Internal service funds are used by management to charge the costs of garage, energy management data processing, insurance and compensated absences to individual funds. With the exception of the data processing fund which is a business-type fund, the assets and liabilities of the internal service funds are included in the governmental activities in the statement of net assets. Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore, are not reported in the funds. Sheffield TIF Redevelopment $585 Capital Improvements General Govt Buildings $2,973,323 897 17,715 ( 490,518) (490,518) $1,482 2,991,025 2,991,025 $2,991,038 Capital Equipment Replacement General Govt $4,510,277 Capital Improvements PIR Fund $ - 1,186,193 Other Total Governmental Governmental Funds Funds $8,448,550 $19,294,180 48,087 108,908 1,186,193 16,511 122,776 83,525 204,375 10,433 10,433 258,281 811,881 210,136 647,716 4,156 18,813 165,836 390,736 $9,245,515 $22,796,01 [ $538,230 $1,656,823 11,027 103,279 1,000 209,887 43,040 142,298 263,685 1,174,716 50,758 1,534,926 21,980 25,780 929,720 4,847,709 4,156 18,813 165,836 165,836 780,821 780,82 ] 3,500,949 380,943 355,626 1,187,646 [ ,187,646 5,796,393 11,938,611 8,315,795 17,948,302 $9,245,515 44,049 23,177 4,553,841 4,553,841 $4,554,326 (186,426 ) (186,426 ) $1,209,370 [ 8,059,465 1,506,909 754,856 (2,906,820) $35,362,712 111e notes to the financial statements are an integral part of this statement. 43 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS For The Year Ended December 31,2002 Municipal General Anoka County State Aid Fund CDBG Street Fund Revenues: Taxes S3,534,854 $ $ - Tax increment collections Spccial assessments Licenses and permits 277,924 Intergovernmental 3,446,083 383,183 2,956,507 Charges for scrvices 414,739 Fines and forfeitures 84,346 Investment income: Interest and dividends 178,819 Change in fair valuc 68,523 Othcr rcvenues 18,357 55,998 Total revenues 8,123,645 383,183 3,012,505 Expenditures: Current: General government 1,575,505 Public safety 3,380,893 Public works 1,074,477 46,648 Culture and recreation 1,213,016 Community development 415,894 Capital outlay; General government Public safety Public works 3,939,613 Culture and rccreation Corrununity development Debt service: Principal retirement Interest and fiscal charges Miscellaneous Developer incentives Contractual services Total expenditures 7,243,891 415,894 3,986,261 Revenues over (under) expenditures 879,754 (32,711) (973,756) Other financing sourCeS (uses): Transfers in 670,769 36,241 Transfers out (1,932,293 ) (5,913) (93,076) Reclassification of prior years costs Total other financing sources (uses) (1,261,524) (5,913) (56,835) Net change in fund balance (381,770) (38,624) (1,030,591) Fund balance - beginning 3,897,376 13,307 304,887 Fund balance - ending $3,515,606 ($25,317 ) ($725,704) The notes to the financial statements are an intregral part of this statement. 44 Statement 4 Capital Capital Sheffield Improvements Equipment Capital Other Total TlF General GO\-t Replacement Improvements Governmental Governmental Redevelopment Buildings General Govt PIR Fund Funds Funds $ - 1) - $ - 1) - $809,663 :b4,344,517 38,692 760,524 799,216 597,380 597,380 277,924 6,221 10,000 254,890 940,108 7,996,992 752,137 1,166,876 84,346 - 83,594 107,863 394,153 964,429 20,544 51,085 96,866 237,018 12,005 6,090 80,774 154,547 327,771 44,913 126,143 265,038 933,044 3,907,998 16,796,469 8,521 292,970 1,876,996 448,285 3,829,178 41,871 1,162,996 684,674 1,897,690 138 1,062,488 1,478,520 20,778 20,778 54,057 70,591 124,648 1,356,588 5,296,201 26,610 26,610 257,425 257,425 716,515 716,515 530,985 530,985 30,237 30,237 104,258 104,258 66,885 66,885 138 20,778 62,578 1,398,459 4,291,923 17,419,922 44,775 105,365 202,460 (465,415) (383,925) (623,453 ) 1,358, J 98 388,057 322,320 3,636,964 11,412,549 (535,293 ) (79,534) (70,721) (3,034,600) (5,751,430) 445,254 445,254 (535,293 ) 1,358,198 308,523 696,853 602,364 1,106,373 (490,518) 1,463,563 510,983 231,438 218,439 482,920 1,527,462 4,042,858 (417,864) 8,097,356 17,465,382 ($490,518) $2,991,025 $4,553,84] ($186,426) $8,315,795 SI7,948,302 The notes to the financial statements are an intregral part of this statement. 45 46 CITY OF COLUl\1BIA HEIGHTS, MINNESOTA RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEIvIENT OF ACTIVITIES For The Year Ended December 31, 2002 Statement 5 Amounts reported for governmental activities in the statement of activities (Statement 4) are different because: Net changes in fund balances - total governmental funds (Statement 4) $482,920 Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and repOlted as depreciation expense. This is the amount by which capital outlays exceeded depreciation in the current period. 4,445,788 The effect of sales involving capital assets are to decrease net assets (6,000) Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds. 306,358 The issuance of long-term debt (e.g., bonds, leases) provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net assets. This amount is the net effect of these differences in the treatment of long-term debt and related items. 716,515 Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. ( 14,490) Internal service funds are used by management to charge the costs of central garage, data processing, insurance, and compensated absences to individual funds. The net revenue of certain activities of internal service funds are reported with governmental activities 75,403 Change in net assets of governmental activities (Statement 2) $6,006,494 The notes to the financial statements are an intregral part of this statement. 47 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF FUND NET ASSETS PROPRIETARY FUNDS December 31, 2002 Assets Current assets: Cash and cash equivalents Receivables: Accounts (net of allowance for uncollectables) Interest Due from other governmental units Interftmd receivable Prepayments Inventory, at cost Total cw-rent assets Noncurrent assets: Due from other governmental units Capital assets: Land Buildings Improvements other than buildings Office furniture and fixtures Machinery and equipment Construction in process Total capital assets Less: accumulated depreciation Total capital assets (net of accumulated depreciation) Total noncurrent assets Total assets Liabilities Current liabilities: Accounts payable Accrued salaries and withholdings payable Due to other governmental units Due to other funds Accrued interest payable Deposi ts Compensated absences payable - current Bonds payable - current Total current liabilities Noncurrent liabilities: Compensated absences payable - noncurrent Bonds payable - noncurrent Total noncurrent liabilities Total liabilities Net Assets Invested in capital assets, net ofrelated debt Restricted for debt service Unrestricted Water Sewer $39,923 $2,679,905 283,783 263,948 6,668 29,389 1,160 678,675 623,404 2,864 1,013,073 3,596,646 200,083 45,223 36,586 447,305 45,201 5,550,711 4,153,263 25,259 40,964 206,972 418,383 5 6,275,470 4,694,402 (2,291,954) (2,678,294) 3,983,516 2,016,108 3,983,516 2,216,191 4,996,589 5,812,837 3,702 4,763 3,044 2,734 256,999 678,675 14,420 547 3,744 385 385 94,032 3,568 1,055,001 11,997 12,791 12,791 767,988 29,136 780,779 41 ,927 1,835,780 53,924 3,12],496 1,983,399 280,658 4,164 (241,345) 3,771,350 $3,160,809 $5,758,913 Total net assets The notes to the financial statements are an intregral part of this statement. 48 Statement 6 Business-Type Activities - Enterprise Funds Total Total Internal Service Proprietary Refuse Storm Sewer Liquor Enterprise Funds Funds Funds $605,231 $107,676 $1,983,131 $5,415,866 $1,739,066 $7,154,932 280,375 36,237 864,343 2,453 866,796 6,772 1,675 19, II 0 63,614 5,939 69,553 20,382 14,955 2,024 38,521 38,521 1,302,079 1,302,079 12,477 12,477 1,188,663 1,191,527 66,359 1,257,886 912,760 160,543 3,192,928 8,875,950 1,826,294 10,702,244 200,083 200,083 254,724 4,360 340,893 340,893 6,000 162,239 660,745 371,383 1,032,128 11,566 774,028 81,198 10,570,766 119,847 10,690,613 14,791 81,014 81,014 97,124 289,381 1,011,860 103,183 1,115,043 37,90 I 37,906 37,906 114,690 1,066,653 551,969 12,703,184 594,413 13,297,597 (40,961 ) (53,360) (484,486 ) (5,549,055) (427,192) (5,976,247) 73,729 1,013,293 67,483 7,154,129 167,221 7,321,350 73,729 1,013,293 67,483 7,354,212 167,221 7,521,433 986,489 1,173,836 3,260,411 16,230,162 1,993,515 18,223,677 208,101 169 234,286 451,021 24,030 475,051 69 10,617 16,464 3,316 19,780 58,612 315,611 315,611 96,404 775,079 775,079 12,635 27,602 27,602 3,744 3,744 883 1,653 877 2,530 82,400 180,000 180,000 208, I 01 191,677 304,398 1,771,174 28,223 1,799,397 29,352 54,934 576,640 631,574 672,876 ] ,4 70,000 1,4 70,000 0 672,876 29,352 1,524,934 576,640 2, I 0 I ,574 208,101 864,553 333,750 3,296,108 604,863 3,900,971 73,729 220,116 67,483 5,466,223 167,221 5,633,444 (109,039) 175,783 175,783 704,659 198,206 2,859,178 7,292,048 1,221,431 8,513,4 79 $778,388 $309,283 $2,926,661 12,934,054 $1,388,652 $14,322,706 Some amounts reported for business-type activities in the statement of net assets are different because certain internal service fund assets and liabilities are included with business-type activities. 473,977 Net assets of business-type activities $13,408,031 The notes to the financial statements are an ITItregraJ part of this statement. 49 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS PROPRIETARY FUNDS For The Year Ended December 31, 2002 Water Sewer Operating revenues: Charges for serviees S64,891 51,204,112 Charges for sales 1,326,721 Total operating revenues 1,391,612 1,204,112 Operating expenses: Costs of sales, services and goods sold 1,389,858 950,680 Operating expense Depreciation 161,970 130,073 Total operating expenses 1,551,828 1,080,753 Net income (loss) from operations ( 160,216) 123,359 Nonoperating revenues (expenses): Investment income: Interest and dividends 3 1,467 I 38,688 Change in fair value 7,733 34,083 Intergovernmental 198 Miscellaneous revenues 57 16,824 Interest and fiscal charges (35,152) (l ,333) Miscellaneous expenses Total nonoperating revenues (expenses) 4,105 188,460 Net income (loss) before transfers (156,111) 311,819 Transfers in 309,358 250,965 Transfers out (428,724) (360,329) Total transfers (119,366) (109,364) Change in net assets (275,477) 202,455 Total net assets - beginning, as previously stated 3,4 75,253 5,589,809 Change in accounting principle (38,967) (33,351 ) Total net assets -beginning, as restated 3,436,286 5,556,458 Total net assets - ending $3,160,809 55,758,913 The notes to the financial statements are an intregral part of this statement. 50 Statement 7 Business-Type Activities - Enterprise Funds Total Total Internal Service Proprietary Refuse Storm Sewer Liquor Enterprise Fnnds Funds Funds $1,247,692 $172,975 $ $2,689,670 $820,297 $3,509,967 6,857,307 8,184,028 . 57,543 8,241,571 1,247,692 172,975 6,857,307 10,873,698 877,840 11,751,538 1,279,462 98,905 5,254,598 8,973,503 919,142 9,892,645 1,093,38 ] 1,093,381 33,002 ],126,383 11,169 33,988 12,929 350,129 46,224 396,353 1,290,631 132,893 6,360,908 10,417,0]3 998,368 11,415,381 (42,939) 40,082 496,399 456,685 (120,528) 336,157 31,956 7,899 90,180 300,190 28,032 328,222 7,854 1,941 22,163 73,774 6,888 80,662 53,780 130,339 ] 84,31 7 184,317 1,290 26,037 44,208 3,022 47,230 (30,799) (67,284) (67,284) (3,939) (3,939) (3,939) 94,880 109,380 134,44 I 531,266 37,942 569,208 51,94] ] 49,462 630,840 987,951 (82,586) 905,365 447,410 1,007,733 314,000 ],321,733 ( 177,552) (457,410) (217,954) (1,64],969) (340,883 ) (1,982,852) (177,552) (10,000) (217,954) (634,236) (26,883 ) (661,119) (125,61/ ) 139,462 412,886 353,715 (l 09,469) 244,246 905,521 174,208 1,524,335 12,669,126 1,554,356 14,223,482 (1,522) (4,387) (10,560) (88,787) (56,235 ) (145,022) 903,999 169,821 2,513,775 12,580,339 1,498,121 14,078,460 $778,388 $309,283 $2,926,661 ] 2,934,054 $],388,652 $14,322,706 Some amounts reported for business-type activities in the statement of activities are different because the net revenue (expense) of certain internal service funds is reported with business-type activities 473,977 Net assets of business-type activities $13,408,031 The notes to the financial statements are an intregral part of this statement. 51 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS For The Y car Ended December 31, 2002 Water Cash flows from operating activities: Cash received from customers Cash received from interfund services provided Cash paid to suppliers for goods and services Cash payments to employees for services Miscellaneous revenues Miscellaneous expenses Net cash flows from operating activities Cash tlows from noncapita[ financing activities: Transfers in Transfers out Net cash flows from nOTIcapital financing activities Cash flows from capital and related financing activities: Acquisition of capital assets Disposition of capital assets Principal payments - bonds Proceeds of capital grants and contributions Interest and tiscal charges Net cash flows from capital and related financing activities Cash flows from investing activities: Investment income: Interest and dividends Change in fair value Net cash flows from investing activities Net increase (dccrease) in cash and cash equivalents Cash and cash eq uiva tents - January I Cash and cash equivalents - Dccember 3] Reconciliation ofopcrating income (loss) to net eash flows from operating activitics Operating income ([ass) Adjustmcnts to reconcile operating income (1oss) to net cash flows from operating activities: Miscellaneous revenues Miscellaneous expenses Depreciation expense Changes in assets and liabilities: (Increase) decrease in accounts receivable (Increase) decrease in due from other governmental units (Increase) decrease in intertimd receivables (Increase) decrease in prepaymcnts (Increase) decrease in inventory, at cost Increase (dcerease) in accounts payable Increase (dccrease) in accrued salaries and wlthholdings payable Increase (decrease) in contracts payable-retained percentage Increase (deercase) in due to other governmental units Increase (decrease) in interfund payables Increase (decrease) in eompcnsatcd abscnees payable Total adjustments Net cash flows from operating activities $1,203,867 (847,327) (248,047) 57 108,550 309,358 (428,724) ( 119,366) (209,717) 21,376 (91,426) (36,473) (3 I 6,240) 36,456 7,733 44,189 (282,867) 322,790 $39,923 ($160,216) 161,970 1,755 ( 1,1(0) ( 188,340) 1,844 [ ,053 (11,209) ] 01 ,280 188,340 13,176 268,766 $108,550 The notes to the financial statements arc an intregral part of this statement 52 Sewer $1,169,406 (785,058) (158,940) 17,022 242,430 250,965 (360,329) (109,364) (209,516) ( 3,469) (1,383) (214,368) 138,398 34,083 172,481 91,179 2,588,726 S2,679,905 $123,359 57 17,022 130,073 8,257 28,878 (71,841) 3.986 (l0,480) 13,170 119,071 $242,430 Statemeilt 8 Business-Type Enterprise Funds Total Total Total Internal Service Proprietary Refuse Storm Sewer Liquor Enterprise Funds Funds Funds $1,248,343 $158,000 $7,025,895 SI0,805,511 $ $10,805,511 915,570 915,570 (1,172,974) 20,009 (5,865,191) (8,650,541 ) (6]0,471) (9,261,012) (581 ) (54,452) (671,379) (1,133,399) (276,006) (1,409,405) 55,070 26,037 98,186 3,022 101,208 (3,939) (3,939) (3,939) 129,858 123,557 511,423 1,115,818 32,1 ]5 1,147,933 447,410 1,007,733 314,000 1,321,733 ( 177,552) (457,410) (217,954) (1,641,969) (340,883 ) (1,982,852) (177,552) (10,000) (217,954) (634,236) (26,883) (661,119) ( 124,548) (543,781 ) (543,781 ) . 21,376 21,376 (80,105) (] 75,000) ( 175,000) 130,339 ]30,339 130,339 (31,956) (69,812) (69,812) 0 (] 06,270) 0 (636,878) (636,878) 34,946 12,765 92,306 314,871 44,601 359,472 7,854 1,941 22,163 73,774 6,888 80,662 42,800 14,706 114,469 :\88,645 5\,489 440,134 (4,894) 2],993 407,938 233,349 56,72\ 290,070 610,125 85,683 1,575,193 5,182,517 1,682,345 6.864,862 $605,231 S107,676 SI,983,131 $5,415,866 $1,739,066 S7,154,932 ($42,939) . $40,082 $496,399 S456,685 ($120,528) $336,157 55,070 26,03 7 98,186 3,022 101,208 (3,939) (3,939) (3,939) 11,169 33,988 J2,929 350, I 29 46,224 396,353 3,271 (20) 13,263 178 13,441 (2,620) (14,955) (412) 9,731 9,73 ] 169,000 (91,18] ) (91,18 J) 71,799 7 I ,799 (286,346) (284,502) (10,249) (294,751) J 05,907 (],156) 106,708 216,498 1,675 2] 8, 173 57 (30,013) (51,645) 37,696 ( 13,949) (9, 175) 92,105 92,]05 65,561 253,90J 253,901 30,235 56,587 2,298 58,885 172,797 83,475 ]5,024 659,133 152,643 811,776 $129,858 $123,557 $5] 1,423 $1,115,818 $32,115 $1,147,933 The notes to the tinancial statements arc an intregral part of this statement. 53 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF FIDUCIARY NET ASSETS FIDUCIARY FUNDS December 31,2002 Statement 9 Assets Cash and investments Total assets Liabilities Liabilities: Accounts payable Due to other governmental units Deposits Other liabilities Total liabilities The notes to the financial statements are an intregrat part of this statement. 54 Total Agency $36,854 36,854 21,136 9,777 4,350 1,591 $36,854 CITY OF COLUMBIA HEIGHTS, lVIINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City of Columbia Heights was incorporated in 1898. The City is governed by a Council composed of an elected mayor and four council members. The Council exercises legislative authority and determines all matters of policy. The Manager, who is appointed by the Council, is responsible for the proper administration of all affairs relating to the City. The financial statements of the City of Columbia. Heights have been prepared in confornlity with generally accepted accounting principles as applied to governmental units by the Governmental Accounting Standards Board (GASB). The following is a summary of the significant policies. A. FINANCIAL REPORTING ENTITY The component units discussed below are included in the City's reporting entity because of the significance of their operational or financial relationships with the City. The City of Columbia Heights has two component units - the Housing and Redevelopment Authority (HRA) and the Economic Development Authority (EDA). The HRA and the EDA are considered component units because the governing boards are substantively the same as that of the City and because the City is in a relationship of financial benefit or burden with each of the entities. The financial position and results of operations of the HRA and the EDA component units are presented using the blended method. Blended component units, although legally separate entities, are, in substance, part of the City's operations and as such are reported as Special Revenue Funds and Capital Project Funds. The component units include Governmental Funds using the modified accrual basis of accounting. Separate financial statements for the HRA and EDA are not prepared. B. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS The government-wide financial statements (i.e., the statement of net assets and the statement of changes in net assets) report information on all of the nonfiduciary activities of the primary govemment and its component units. For the most part, the effect of interfund activity has been removed from these statements. Govemmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benetit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not included among program revenues are reported instead as general revenues. 55 CITY OF COLUMBIA HEIGHTS, l\1INNESOT A NOTES TO FINANCIAL STATEMENTS December 31, 2002 Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. c. MEASUREMENT FOCUS, BASIS OF ACCOUNTING, AND FINANCIAL STATEMENT PRESENTATION The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund and fiduciary fund financial :>tatements. Revenues are recorded when earned and expense:> are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Governmental fund financial statements are reported using the current financial resources measurement focus and the 11lod~fied accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the government considers all revenues, except reimbursement grants, to be available if they are collected within 60 days of the end of the current fiscal period. Reimbursement grants are considered available if they are collected within one year of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and j udgments, are recorded only when payment is due. Property taxes, special assessments, intergovernmental revenues, charges for services and interest associated with the current fiscal period are all considered to be sllsceptible to accrual and so have been recognized as revenues of the cun"ent fiscal period. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the government. The government reports the following major governmental funds: The generalfund is the government's primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. The Anoka County CDBC fund was established to account for the revenues and expenditures associated with federal community development block grants and HOME funds. The municipal state aid street Jimd is maintained according to State Statue to account for maintenance and construction of streets of municipal state aid systems. 56 CITY OF COLUl\1IBlA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 The Sheffield tax increment financing redevelopment fund was established to separate tax increment collections funding the redevelopment of the area of the City identified as Sheffield neighborhood. The capital improvements - general government buildingsfimd was established to account for improvements to municipal buildings including the library, municipal garage and city hall. The capital equipment replacement - general government fund was established to account for the replacement of capital assets as needed. The capital improvement - P/Rfund was established to account for projects that will be fully assessed to the affected properties. The government reports the following major proprietary funds: The water fimd accounts for revenue and expenses associated with water services to area residents. The sewer.timd accounts for revenues and expenses associated with sewer disposal within the City. The refuse fund accounts for revenues and expenses associated with organized collection of refuse and recycling within the City. The storm sewerfwzd accounts for revenues and expenses associated with storm water disposal. The liquorfwzd accounts for revenues and expenses associated with the operation of three off-sale liquor stores. Additionally, the government reports the following fund types: Internal sen1ice funds account for central garage, energy management, data processing, insurance, and compensated absences services provided to other departments of the government on a cost reimbursement basis. Agency - The pennit surcharge agencyfwzd is used to account for SAC charges and surcharges collected for and remitted to the State of Minnesota. The escrow agenc.y fund accounts for payroll related fees collected for other government agencies. Private-sector standards of accounting and financial reporting issued prior to December l, 1989, generally are followed in both the government-wide and proprietary-fund financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following subsequent private- 57 CITY OF COLUl\'IBIA HEIGHTS, J.\1llNNESOT A NOTES TO FINANCIAL STATEMENTS December 31, 2002 sector guidance for their business-type activities and enterprise funds, subject to this same limitation. The government has elected not to follow subsequent private-sector guidance. As a general rule the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this general rule are transactions that would be treated as revenues, expenditures or expenses if they involved external organizations, such as buying goods and services or payments in lieu of taxes, are similarly treated when they involve other funds of the City of Columbia Heights. Elimination of these charges would distort the direct costs and program revenues repOlted for the various functions concerned. Amounts reported as program revenues include 1) charges to customers or applicants for goods, services, or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the water, sewer, refuse, storm sewer and liquor operations enterprise funds and of the internal service funds are charges to customers for sales and services. Operating expenses for enterprise funds and internal service funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. When both restricted and unrestricted resources are available for use, it is the government's policy to use restricted resources first, then unrestricted resources as they are needed. The City does not use encumbrance accounting. D. BUDGETARY DATA The City Manager submits to the City Council a proposed operating budget for the fiscal year commencing on January I of the following year. At least one special Council meeting is conducted to obtain public comments as required by the State Truth in Taxation Law. The City Council annually adopts budgets prior to January 1 for the General and certain Special Revenue Funds. The budgets are prepared by fund, function, and activity. The budgets are adopted on a basis consistent with generally accepted accounting principles and all appropriations lapse at the end of the budget year to the extent that they have not been expended. Total expenditures appropriated in the budget resolution may not legally exceed the estimated revenues available from various sources. Formal budgetary integration is employed as a management control device during the year. Budget revisions between functions or activities may be made by the City Manager. Budget revisions at the fund level are authorized by the City Council in accordance with the City Charter 58 CITY OF COLUMBIA HEIGHTS, l\tIlNNESOTA NOTES TO FINANCIAL STATEMENTS December 31 , 2002 at the request of the City Manager. The legal level of budgetary control is therefore at the fund level. The City does not use encumbrance accounting. E. CASH AND INVESTMENTS Cash balances from all funds of the City are pooled and invested to the ext~nt available in authorized investments. Investments are stated at fair value, based upon quoted market prices. Investment income is allocated to the individual funds on the basis of applicable cash balance participation by each fund using an average of monthly beginning cash and investment balances. The City provides temporary advances to funds that have insufficient cash balances by means of an advance from another fund shown as interfund receivables in the advancing fund, and an interrund payable in the fund with the deficit, until adequate resources are received. The interfund balances are eliminated on the government-wide financial statements. F. RECEIVABLES AND PAYABLES During the course of operations, numerous transactions occur between individual funds for goods provided or services rendered. Short-term interrund loans are classified as "interfund receivables/payables." All short-term interrund receivables and payables at December 31,2002 are planned to be eliminated in 2003. Long-term interfund loans are classified as "interfund loan receivable/payable." Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as "internal balances." Property taxes and special assessments have been reported net of e::;timated uncollectible accounts. (See Note I G and H) Because utility bills are considered liens on property, no estimated uncollectible amounts are established. Uncollectible amounts are not material for other receivables and have not been reported. G. PROPERTY TAX REVENUE RECOGNITION The City Council annually adopts a tax levy and certifies it to the County in December (levy/assessment date) of each year for collection in the following year. The County is responsible for billing and collecting all property taxes for itself, the City, the local School District and other taxing authorities. Such taxes become a lien on January I and are recorded as receivables by the City at that date. Real property taxes are payable (by property owners) on May 15 and October 15 of each calendar year. Personal property taxes are payable by taxpayers on February 28 and June 30 of each year. These taxes are collected by the County and remitted to the City on or before July 7 and December 2 of the same year. Delinquent collections for November and December are received the following January. The City has no ability to enforce payment of property taxes by propelty owners. The County possesses this authority. 59 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 GOVERNMENT-WIDE FINANCIAL STATEMENTS The City recognizes property tax revenue in the period for which the taxes were levied. Uncollectible property taxes are not material and have not been reported. GOVERNMENT AL FUND FINANCIAL STATEMENTS The City recognizes property tax revenue when it becomes both measurable and available to finance expenditures of the current period. In practice, current and delinquent taxes and State credits received by the City in July, December and January are recognized as revenue for the current year. Taxes collected by the County by December 31 (remitted to the City the following January) and taxes and credits not received at the year end are classified as delinquent and due from County taxes receivable. The portion of delinquent taxes not collected by the City in January are fully offset by deferred revenue because they are not available to finance current expenditures. H. SPECIAL ASSESSMENT REVENUE RECOGNITION Special assessments are levied against benefited properties for the cost or a portion of the cost of special assessment improvement projects in accordance with state statutes. These assessments are collectible by the City over a term of years usually consistent with the term of the related bond issue. Property owners are allowed to (and often do) prepay future installments without interest or prepayment penalties. Once a special assessment roll is adopted, the amount attributed to each parcel is a lien upon that property until full payment is made or the amount is determined to be excessive by the City Councilor court action. If special assessments are allowed to go delinquent, the property is subject to tax forfeit sale. Proceeds of sales from tax forfeit properties are allocated first to the County's costs of administering all tax forfeit properties. Pursuant to state statutes, a property shall be subject to a tax forfeit sale after three years unless it is homesteaded, agricultural or seasonal recreational land, in which event the property is subject to such sale after five years. GOVERNMENT-WIDE FINANCIAL STATEMENTS The City recognizes special assessment revenue in the period that the assessment roll was adopted by the City Council. Uncollectible special assessments are not material and have not been reported. GOVERNMENTAL FUND FINANCIAL STATEMENTS Revenue from special assessments is recognized by the City when it becomes measurable and available to finance expenditures of the current fiscal period. In practice, current and delinquent special assessments received by the City are recognized as revenue for the current year. Special assessments that are collected by the County by December 31 (remitted to the City the following January) are also recognized as revenue for the current year. All remaining delinquent, deferred 60 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31 , 2002 and special deferred assessments receivable in governmental funding are completely offset by defelTed revenues. I. INVENTORIES GOVERNMENTAL FUNDS The original cost of materials and supplies has been recorded as expenditures at the time of purchase. These funds do not maintain material amounts of inventories. Real estate held for resale is valued at the lower of cost or market. PROPRIETARY FUNDS Inventories of the Proprietary Funds are stated at cost, which approximates market, using the first- in, first-out (FIFO) method. J. PREPAID ITEMS Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government-wide and fund financial statements. K. CAPITAL ASSETS Capital assets, which include land, buildings, improvements, office fumiture and fixtures, machinery and equipment, and infrastructure assets (e.g., roads, bridges, sidewalks, and similar items), are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Capital assets are defined by the government as assets with an initial, individual cost of more than $5,000 (amount not rounded) and an estimated useful life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of donation. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business-type activities is included as part of the capitalized value of the assets constructed. For the year ended December 31,2002, no interest was capitalized in connection with construction in progress. 61 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 Property, plant, and equipment of the primary government, as well as the component units, is depreciated using the straight line method over the following estimated useful lives: Capital Assets Buildings and structures Machinery and equipment Furniture and fixtures Other park improvements Streets Distribution and collection systems 20 - 50 years 3 - 10 years 5 - I 0 years 20 - 50 years 20 - 50 years 20 - 60 years L. COMPENSATED ABSENCES It is the City's policy to permit employees to accumulate earned but unused vacation and sick pay benefits. All vacation pay and one-third of sick pay is accrued when incurred in the government- wide and proprietary fund financial statements. A liability for these amounts is reported in governmental funds only if they have matured, for example, as a result of employee resignations and retirements. In accordance with the provisions of Statement of Government Accounting Standards No. 16, Accounting for Compensated Absences, no liability is recorded for non vesting accumulating rights to receive sick pay benefits. However, a liability is recognized for that portion of accumulating sick leave benefits that is vested as severance pay. M. LONG-TERM OBLIGATIONS In the government-wide financial statements and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type statement of net assets. Bond premiums and discounts, as well as issuance costs, are immaterial and are expensed in the year of bond issuance. In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. 62 CITY OF COLUMBIA HEIGHTS, l\IllNNESOT A NOTES TO FINANCIAL STATEMENTS December 31, 2002 N. FUND EQUITY In the fund financial statements, governmental funds report reservations of fund balance for amounts not available for appropriation or legally segregated for a specific future use. Designated fund balances represent tentative plans for future use of financial resources. O. INTERFUND TRANSACTIONS Interfund services provided and used are accounted for as revenues, expenditures or expenses. Transactions that constitute reimbursements to a fund for expenditures/expenses initially made from it that are properly applicable to another fund, are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed. Interfund loans are reported as an interfund loan receivable or payable which offsets the movement of cash between funds. All other interfund transactions are reported as transfers. P. USE OF ESTIMATES The preparation of financial statements in accordance with generally accepted accounting Principles (GAAP) requires management to make estimates that affect amounts reponed in the financial statements during the reponing period. Actual results could differ from such estimates. Q. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS I. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND BALANCE SHEET AND THE GOVERNMENT-WIDE STATEMENT OF NET ASSETS The governmental fund balance sheet includes a reconciliation betweenfimd balance - total govemmental funds and net assets - governmental activities as reponed in the government- wide statement of net assets. One element of that reconciliation explains that "long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported in the funds." The details of this ($2,906,820) difference are as follows: Bonds payable Accrued interest payable ($2,713,206) (193,614) Net adjustment to reduce fund balance - total governmental funds to arrive at net assets -governmental activities. ($2,906,820) 63 CITY OF COLUlVIBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 2, EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND STATEMENT OF REVENUES. EXPENDITURES. AND CHANGES IN FUND BALANCES AND THE GOVERNMENT-WIDE STATEMENT OF ACTIVITIES The governmental fund statement of revenues, expenditures, and changes in fund balances includes a reconciliation between net changes infwId balances - toral govemmentalfunds and changes in net assets afgovernmental activities as reported in the government-wide statement of activities. One element of that reconciliation explains that "Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense," The details of this $4,445,788 difference are as follows: Capital outlay Depreciation expense Net adjustment to increase net changes in fund balance - total governmental funds to arrive at changes in net assets of governmental activities. $5,280,407 (834,619) $4,445,788 Another element of that reconciliation states, "Revenues on the Statement of Activities that do not provide current financial resources are not reported as revenucs in the funds." The details of this $306,358 difference are as follows: General property taxes deferred revenue: At December 31, 200 I At December 31, 2002 Tax increment taxes deferred revenue: At December 31, 2001 At December 31, 2002 Special assessments deferred revenue: At December 31, 200 1 At December 31, 2002 Loans receivable - deferred revenue: At December 31 , 200 I At December 31, 2002 Real estate held for resale - deferred revenue: At December 31, 200 I At December 31, 2002 Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities. 64 ($79,683) 77,137 (10,781 ) 10,012 (818,444 ) 1,184,427 (22,104 ) 10,433 (269,539) 224,900 $306,358 CITY OF COLUMBIA HEIGHTS, l\1INNESOT A NOTES TO FINANCIAL STATEMENTS December 31, 2002 Another element of that reconciliation states that "the issuance of long-term debt (e.g., bonds, leases) provides current financial resources to governmental funds, while the repayment of the long-term debt consumes the current financial resources of governmental funds." Neither transaction, however, has any effect on net assets. The details of this $716,515 difference are as follows: Principal repayments: General obligation debt - tax increment General obligation debt - improvement Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities. $611,515 1 05,000 $716,515 R. STATEMENT OF CASH FLOWS For purposes of the Statement of Cash Flows, the City considers all highly liquid debt instruments with an original maturity of three months or less to be cash equivalents. All of the Proprietary Funds' equity in the City-wide cash and investment management pool is considered to be cash equivalents. 65 CITY OF COLUMBIA HEIGHTS, l\tIINNESOT A NOTES TO FINANCIAL STATEMENTS December 31, 2002 Note 2 DEPOSITS AND INVESTMENTS The City maintains a cash and investment pool that is available for use by all funds of the City. Each fund type's portion of this pool is displayed on the combined balance sheet as "Total Cash and Investments." An indication of the level of risk assumed by the City at year-end is categorized as follows for the City's cash and investments. DEPOSITS In accordance with Minnesota Statutes, the City maintains deposits at depository banks authorized by the City Council. Minnesota Statutes require that all deposits be protected by insurance, surety bond, or collateral. The market value of collateral pledged must equal 11 0% of the deposits not covered by insurance or bonds (140% in the case of mortgage-backed collateral). Authorized collateral includes the legal investments described below, as well as certain first mortgage notes, and certain other state or local government obligations. Minnesota Statutes require that securities pledged as collateral be held in safekeeping by the City or in a financial institution other than that furnishing the collateral. Deposits include checking accounts, savings accounts, and certificates of deposit. At December 31, 2002, the book balance of the City's deposits was $1,977 ,240 and the bank balance was $2,441,509. The entire bank balance was insured or collateralized by securities held by the City's agent in the City's name. INVESTMENTS The City may also invest idle funds as authorized by Minnesota Statutes as follows: direct obligations or obligations guaranteed by the United States or its agencies, its instrumentalities, or organizations created by an act of congress, excluding mortgage-backed securities defined as high risk; shares of investment companies registered under the Federal Investment Company Act of 1940 and whose only investments are in securities described above, general obligation tax-exempt securities, or repurchase or reverse repurchase agreements; general obligations of the State of Minnesota or any of its municipalities; bankers' acceptances of United States' banks eligible for purchase by the Federal Reserve System; commercial paper issued by United States' corporations or their Canadian subsidiaries, of the highest quality, and maturing in 270 days or less; repurchase or reverse repurchase agreements with banks that are members of the Federal Reserve System with capitalization exceeding $10,000,000, a primary reporting dealer in U.S. government securities to the Federal Reserve Bank of New York, or certain Minnesota securities broker-dealers; and future contracts sold under authority of Minnesota Statutes Section 471.56, Subdi vision 5. As allowed by authorized investment laws, a portion of the City's investment portfolio is invested in collateralized mortgage obligations which are a form of "derivative" investments. Essentially, these investments can be described as having a variable rate with a guaranteed return of principal. The City invests in these investments for purposes of portfolio diversification. 66 CITY OF COLUMBIA HEIGHTS, lVIINNESOTA NOTES TO FINANCIAL STATEMENTS December 3 I, 2002 The City's investments are categorized to give an indication of the level of custodial credit risk assumed at year-end. Category 1 includes investments that are insured or registered or for which the securities are held by the City or its agent in the City's name. Category 2 includes uninsured and unregistered investments for which the securities are held by the counterparty's trust department or agent in the City's name. Category 3 includes uninsured and unregistered investments for which the securities are held by the counterparty or by its trust department or agent but not in the City's name. Investment balances at December 31,2002 are as follows: Custodial Credit Risk Category 2 3 Carrying Amount At Fair Val ue U.S. Government Securities (including securities insured by the U. S. Government) Money Market Fund Total investments Deposits Cash on hand Total cash and investments $19,123,525 $ $ 19,123,525 5,379,001 24,502,526 1,977,240 6,200 $26,485,966 67 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 3 1 , 2002 Note 3 RECEIV ABLES Significant receivables balances not expected to be collected within one year of December 31,2002 are as follows: Special assessments receivable Delinquent property taxes Delinquent tax increment Due from other governmental units General $ Major Funds Capital Improvement PIR Fund $1) 16,673 Nonmajor Sewer Funds Total $ $ $916,673 1,530 51,393 6,671 6,671 200,083 200,OR3 $200,083 $8,201 $1,174,820 49,863 Total $49,863 $916,673 INTERCEPTOR ACQUISITION CONTRACT RECEIVABLE As of January 1, 1996, the Metropolitan Council (MCES) assumed ownership of an existing interceptor pursuant to an agreement with the City of Hilltop regarding usage of interceptors owned and maintained by the City of Columbia Heights. The MCES acquired the interceptor at a cost of$330,413.72. This amount is being amortized through current value payments from MCES over a 15-year period with interest at 4%. As of December 31, 2002, a balance of $200,083 remained to be collected over the next eight years. This receivable is presented as due from other governmental units in the Sewer Utility Fund. GovemmentaI funds report deferred revenue in connection with receivables for revenues that are not considered to be available to liquidate liabilities of the current period. Govemmental funds also defer revenue recognition in connection with resources that have been received, but not yet eamed. At the end of the current fiscal year, the various components of deferred revenue and uneamed revenue reported in the governmental funds were as follows: Delinquent property taxes receivable (general fund) Delinquent property taxes receivable (nonmajor funds) Delinquent tax increment (nonmajor funds) Delinquent special assessments (capital improvements - PIR fund) Specialllssessments not yet due (capital improvements - PIR fund) Loans receivable (nonmajor funds) Grant drawdowns prior to meeting all eligibility requirements (nonmajor funds) Rental fees received but uneamed (non major funds) Real estate held from resale - unearned (Anoka County CDBG fund) Total deferred/unearned revenue for governmental funds Unavailahle $74,841 2,296 10,012 110,567 1,073,860 10,433 Unearned S 17,048 10,969 224,900 SI,506,909 S21\,017 68 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 Note 4 CAPIT AI.. ASSETS Capital asset activity for the year ended December 31,2002, as previously reported is as follows: Governmental Activities: Resruted " January 1,2002 Internal Beginning Infrastructure! As Service Used Ending Primary Government Balance ClP Restated Primarily Additions Deletions Adiustmenl~ Balance Governmentnl Activities: Capital assets. not depreciated Lam! li3,R56,053 $ $3,856,053 $ $ $ ($773,367) $3,082,686 Construction in progress 2,927,422 2,927,422 - 5,303,029 2,531,231 5,699,220 Total capillil assets not being deprecimed 3,R56,053 2,927,422 6,783,475 - 5,303,02<) 2,531,231 [773.367) 8,781,906 Capit.'Il assets - being depreciated Buildiflgs and structures 8,741,182 8,74] ,782 371,383 259.358 7S1,1l4 10,153,637 Improvements 3,594,858 3,594,858 119,847 37],593 (1,108,902) 2,977,396 Office furniture and fixtures - 24,67" 228,778 253.452 Machinery and equipment 7,158,117 7,158,117 77,044 831,730 6,000 (3,615,878) 4,445,013 InfrastIllcturc 8,182,009 8,182,009 1,021,254 9,203,263 Total capital assets being depreciated 19.494,757 8,182,009 27,676,766 568,274 2,508,609 6,000 (3.714,888) 27 ,032, 76l Less accumulated depreciation for: Buildings and structures 7,<)35,005 7,935,005 2'16,888 86,3 Y J 8J 18,284 Improvemeflls 1.762,977 1,762,977 56,767 40,831 1,860,575 Office furniture and fixtures 151,327 151,327 14,Y20 28,044 ]94,291 Machinery and eqllipmenl 1,949,091 J,949,OYI 39,880 305.405 - 2,294,3 76 InfrastruClure 4,713,727 - 4,713,727 373,949 - 5,087,676 Accilmulmed depreciation 16,512,127 0 44,188,893 408,455 834,620 0 0 17, 75J ,202 Governmental acitivities capital assel~ -nel 6,S38,683 1],109,431 (Y,728,fi52) 159,819 fi,977,018 2,537,231 {4,48S,255) 1S,059,4fi5 Depreciation ex.pense charged to functions/programs of the primary government - governmental activities are as follows: Governmental activities: General government Public safety Public works Culture and recreation Community development Total governmental deprecation expense $ 66,908 124,039 519,132 90,433 34,1 07 $834,619 69 CITY OF COLUl\IffiIA HEIGHTS, lVIlNNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 Business-type activities: Restated * January 1,2002 Internal Beginning Infra.',truclurcl As Senicc USt'i! Ending Busincss- Type Acthilies: Balance ClP Restated Primurilv Additions Deletions AdjLL~tmenl~ Balance Capit:1l assets. not deprcciat(.'(\ Land $86.169 $0 $86,169 $0 $254,724 $0 SO S340,893 COllStnlclion in progress 2'13,750 293.750 527,049 782,893 37,906 ToUtI capiUtI assets nO! being depreciated 379,919 379,919 781,773 782,893 378,799 Capital assel, . being dcprc<:ialcd Buildings and structures 707,861 707.S6 1 (47.116) 660.745 Improvcmenls 10,151,184 10.151,184 523.522 (l03.Y40) 10.570,766 onice furniture and fixlIlfes 135,778 135,778 (54.764) 81,014 Machinery and ccluipmenl 1,242.562 1,242.562 26.140 (230.703) 1,037.lJ99 TlllaI capilal asseu; being deprccimed 12,237385 () n,237.385 26,140 523.522 0 (436.523 ) 17.350.524 Less uccumulated depreciation for: Bnildings and stnlel\lfCS 396,660 396,660 26,656 423,316 Improvements 4,052,041 4,052.041 269,771 4.321.812 Office furniUlfC and Jixlures 81.015 81,015 81,015 Machinery lInd equipment 669,011 669,011 18,737 53.901 741,649 Accumlated depreciation 5,198,727 0 5,198.727 18,737 350,328 0 0 5,567.792 Business-type acitivities capillll assets -net 7,418.577 0 7.418.577 7.403 954.967 782,893 (436.523) 7,161.531 T"lal capillll aSSCL~ - net $14,257,260 $11,109,431 ($2,310,075) $167,222 $7.'131,985 $3,320,124 ($4.924,778) $25,220,996 Depreciation expense was charged to functions/programs of the primary government - business-type activities are as follows: ' Business-type acti vities: Water Sewer Refuse Storm sewer Liquor Total business-type depreciation expense $161,970 130,073 11 , 169 33,988 12,929 $350,129 70 CITY OF COLUMBIA HEIGHTS, 1VIINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 Note 5 INTERFUND RECEIVABLES. PA YABLES . AND TRANSFERS Individual fund interfund receivable and payable balances at December 31, 2002 are as follows: Fund General Fund EDA: Anoka County CDBG Sheffield TIF PIR Fund Water Sewer Storm Sewer Nonmajor Funds Receivable $437.580 678,675 623,404 Payable $ 263,710 492,000 155,321 678,675 232,003 96.404 285.552 Total $1,971,662 $1,971,662 Interfund Transfers: Mc!or Fmds GovemrrerdaI Business-lyJ:e Norrmja- Stlle Aid OlpitJl CapiUJI Eq Olpitlll N:rurujrr Street Irrrr Rej:lllJrem Irrpnve Sturn llit Intemul G=real Furd G=n Ci1\' G=n PIR WJIer Sev.er Sev.er Rm.1; Service Tool ~or Fmrk' (',o\lemlTHltnl F\nrl;: O:r.eml S SUSO,052 s..~},UX) Sl\C\j;X) S S $.'155,741 sm,cw SI,932,293 An:ka CUlI1ly CDBG 5,913 5,913 MrnidfOl stale aid street fund 3(,241 56,R.15 93,076 5reffield TIP reO.ovek'prent 535,293 535,293 Capitlll eqt.ll!llI:nt repillcenrnt gen gc 79,534 79,534 Olpitlll inpuverrenlS HR 7n721 70,721 Hi R rP.Wo 1,\v F\ nrk' 'Mlter 74,3(-6 309J5[\ 45.00:1 428,724 Sev.er 74,3(14- 240,%5 45,(0) 3ffi,329 Refu;e 132,552 45,CXXl 177 ~'i52 Stmnsel\cr IO,CUl 447,410 457,410 Liqocr 63,954- IlXl,mo 9,cm 45,00) 217,954 NJrumjor guvertIreIltal fuocIs 10l~149 238,057 17&~5 2, 4&i,2ID :i},cID 3,034;cm ImernaJ service funds 138.737 16.'i,146 34,(0) 340,883 Tcml '$70,7(f) $36,241 SI,358,198 $388,057 S-122,32[) S'309,358 S2"iCl,96.'1 $447,410 $3,6.16,964- $314,(X),'J S7,734,282 71 CITY OF COLUlVIBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 Major Funds: General Fund Special Revenue Funds: EDA: Anoka County CDBG Capital Projects Funds: Sheffield TIF PIR Fund Enterprise Funds: Water Utility Water Construction Capital Equipment Replacement-Wate Water Debt Service Fund Sewer Utility Sewer Construction Storm Sewer Debt Service Nonmajor Funds: Special Revenue Funds: HRA: Rental Housing Cable TV Debt Service Funds: Tax Increment Bonds Scatter Site Housing TIF MURP Capital Projects Funds: TIF District #2 Capital Improvement Projects Infrastucture Replacement Internal Service Funds Governmental internal service funds Business-type internal service funds Interfund Interfund Receivables Pay abies $437,580 $ 263,710 492,000 155,321 63,676 678,675 321,943 293,056 96,404 527,000 96,404 144,800 29,070 52,572 35,000 52.572 2,243 157,564 21,867 21,867 $1,971,662 $1,971,662 72 CITY OF COLUMBlA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 Intenund transfers: General General General General General General General General Community Development State Aid State Aid Cable Television Cable Television Cable Television Special Projects Library Library Tax Increment Bonds Tax Increment Bonds Sheffield Debt Service Housing TlF Scalier Housing TlF Scalier Housing TlF Scaller State Aid PIR Inrrastructure Fund Capital Eq Replacement Water Utility Water Utility Water Utility Water Utility Sewer Utility Sewer Utility Sewer Utility Sewer Utility Reluse Utility Refuse Utility Reluse Utility Storm Sewer Utility Stom] Sewer Utility Storm Sewer Utility Stoml Sewer Utility Liquor Liquor Liquor Liquo r Water Construction Sewer Construction Stom] Sewer Const Central Gardge Centrd! Gardge Centrd! Gamge Energy Management PolicefFire Contingency Compensated Absences Anoka County: CDBO Parhiew Villa North ED A-Administration EDA-Administration Park view Villa South HRA HRA HRA HRA Local Law Enforcement Block Juvenile Justice Grant Capital Improvements -PIR Capitallmprovcments-Generd! CapitallmprovcmenlDev Capital Eq Replacement-General Data Processing Community Development General Fund State Aid Capital Improvements -PIR General Fund Capital Eq Replacement -Olblc Data Processing Capital Improvement Dev General Fund Capital Building - Lihrary Tax increment Retunding 1991 Tax Increment Capital 1990 Sheffield Redel'elopmcnt Capital Improvement PIR HRA EDA-Administration State Aid GO Improvement Bond 1999A Capital Improvements -PIR General Fund General Fund Capital Eq Replacement-Water Data Processing Water Debt Service Capital Eq Replacement-Sewer General Fund Data Processing Sewer Debt Service General Fund Data Processing General Funtl Stoml Sewer Deht Service Sewer Utilily Capital Eq Replacement"Sewer Stonn Sewer Construction Fund General Fund Capital Eq Replacemcnt-Gcneral DARE Progmm Data Processing Water Utility Sewer Utility Storm Sewer Utility Capital Improvements-General Capital Eq Replacement-Gardge Data Processing Capital Improvements-General Capital Eq Replacement-General General Fund General Fund General Fund General Funtl Capital Improvement Dc\' General Fund Sheffield Redevelopment Community Development Capitallmpmvement Del' Section 8 Total Transfers $ $1,916 893 86.500 1,192,984 300,000 50,000 50,000 l5D,ODO 11,826 35,889 56,835 58,549 300,000 50,000 330,0[)() 9,292 200,000 226,380 885,750 535,293 34,605 24,000 17,500 352 70,72] 144,380 79,534 74,366 25,000 45,O()[) 74,641 2'i,OOO 74,364 45,000 5.000 66,276 45,UOO 66,276 46,500 IO,DOO 5,800 32,900 63,954 100,OUO 9,000 45,000 2ll9,717 210,965 362,210 60,5tJO 4,000 3ll,llOO I 07,646 238,057 138,737 5,913 7,884 7,884 I ()(),OIlO 5,914 77,OOn 34,702 185,000 R5 R77 7 B4 2H2 73 Local match: grants Local match: gnlllLS Closure of projects Fund projects Council action: development Replacement tixetl assets Fund data processing services Fund community development Administmtivc labor allocation Ctosure or projects Closure of projects Administmti ve labor allocation Council action: building fund Fund data processing services Council action: development Administrdti ve labor allocation Council action: building fuml Debt service Debt service TIF allocation TIF allocation TIF allocation TIF allocation Closure of projects Debt service Closure of projects Capital equipment replacement Administrative labor allocation Replacement of fixed assets Fund data processing services Debt service Replacement fixed assets Atlministmtivc labor allocation Fund data processing scrvices Dehl service Administrati I'e labor allocation Fund data processing services Administrative labor allocation Debt se rvice Administmtil'e allocation Replacement tlxed assets Fund construction rund Administmtil'e labor allocation Replacement fixed asselS Fund DARE progrdnl Fund tin!.'! processing services Closure of projects Closure of projects Closure of projects Replacement tlxed assets Replacement tlxed assets Fund data processing services Replacement of Jlxed assets Council action: building tund Internal service aUocaLion Admirristrdlive labor allocation Administrative labor allocation Administrdtivc labor allocation Council action: development Administmti I'e labor allocation Guarmteed lunding Fund community development Council action: development Council action: [und Section 8 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 Note 6 OPERATING LEASES A. LEASE EXPENSE The City has leased premises for a liquor store (Top Valu) under a five-year lease agreement that originally expired in 1989. This lease has been renewed through December 31, 2004. This lease is considered for accounting purposes to be an operating lease. Lease expenditures for the year ended December 31,2002 amounted to $133,233. The City also has leased premises for its Top Valu II liquor store under a five-year lease that originally expired February 28, 1998, with a five-year renewal option in 1998 and 2003. The City exercised the 1998 renewal option increasing minimum payments to $3,552 per month. The City is also required to pay all utilities and a pro-rata share of real estate taxes. This lease is considered for accounting purposes to be an operating lease. Lease expenditures for the year ended December 31, 2002 amounted to $61,882. Future minimum rental payments are as follows: Year 2003 2004 Top Value $88,785 88,785 Top Value II $ 7 ,104 Total $177,570 $ 7 ,1 04 B. LEASE REVENUE The City receives revenue from agreements for the lease of space in Parkview Villa North and for antennas placed on the water towers and Parkview Villa. For accounting purposes, the leases are considered operating leases. Lease revenue for the year ended December 31,2002, totaled $27,192. Terms of each lease are as follows: Location Ivanhoe Place 40th Ave NE Lessee Sprint Spectrum American Portable Telecom 2002 $12,008 15,184 Adjustment Greater of CPI or 5% Greater of CPI or 4% Expiration 08/19/06 12/04/06 Total $27,192 74 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 Note 7 LONG-TERM DEBT General Obligation Bonds - The City issues General Obligation Bonds to provide funds for the acquisition and construction of major capital facility additions. General Obligation Bonds have been issued to refund General Obligation Tax Increment Bonds. General Obligation Bonds are direct obligations and are backed by the full faith and credit of the City. General Obligation Bonds currently outstanding are segregated between the amounts to be repaid from governmental activities and amount to be repaid from business-type activities and are as follows: Original Interest Issue Final Balance Issue Rate Date Maturity End of Year General Obligation: Governmental activities: Tax increment bonds: Capital Appreciation Bonds of 1990 $2,399,721 6.90-7.15% 8/23/90 911 /09 $2,008,206 Refundi ng Bonds of ] 991 6,670,000 5.30-5.80% 1211/9] 311 /02 Improvement bonds: Improvement Bonds 1999A 860,000 3.45-4.30% 5/ l/99 2/1/10 705,000 Business-type activities: Revenue bonds: Utility revenue bonds 1999B 1,935,000 3.4 5-4.3 0 r~.{, 5/1 /99 2/1/10 1,650,000 Total General Obligation Bonds Outstanding S4,363,206 ANNUAL DEBT SERVICE REQUIREMENTS As of December 31,2002, the annual requirements to maturity for genera] obligation bonds are as follows: Fiscal Year Ending December 31 2003 2004 2005 2006 2007 2008-20 I 0 Governmental Activities Principal $477,918 445,584 422,272 390,822 370,545 606,065 Interest $568,447 592,151 611,805 634,603 651,235 988,105 Total $2,713,206 $4,046,346 75 Business-type Activities Principal Interest $180,000 $63,105 185,000 56,305 195,000 48,987 200,000 41,185 210,000 32,880 680,000 43,948 $1,650,000 $286,410 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31 , 2002 At December 31, 2002, a total of $1,187,646 is available in Debt Service Funds to service the General Obligation Tax Increment Bonds and the General Obligation Improvement Bonds. There are a number of limitations and restrictions contained in the various bond indentures. The City is in compliance with all significant limitations and restrictions. Delinquent assessments receivable related to the 1 999A bond issue at December 31,2002 totals $23,854. The Tax Increment Bonds are payable from the amount of increase in the property taxes on the property in the Tax Increment District. Any deficiencies in revenues from these sources will be provided by general property taxes. Long- Tefm Debt - Othef - The City is the administering authority fOf the following Tax Increment Finance Districts: A. 1977 Downtown CBD Revitalization Plan A3 Type of District Authorizing Law Redevelopment HRA (Minnesota Statutes Sections 462.545 and 462.585) August I, 2009 $169,960 $598,666 $428,706 $28,434,721 $26,426,5 15 $2,008,206 Duration of District Original Tax Capacity Current Tax Capacity (for taxes collectible in 2002) Captured Tax Capacity Retained Bonds Issued Principal Payments Bonds Outstanding at December 3 I, 2002 B. 1984 Modification to the Downtown CBD Revitalization Plan C7 Type of District Authorizing Law Redevelopment HRA (Minnesota Statutes Sections 462.545 and 462.585) August 1, 2009 S 17,768 $33,432 $15,664 Duration of District Original Tax Capacity Current Tax Capacity (for taxes collectible in 2002) Captured Tax Capacity Retained Bonds Issued Principal Payments Bonds Outstanding at December 31, 2002 76 CITY OF COLUMBIA HEIGHTS, lVllNNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 C. 1984 University Avenue Redevelopment C8 Type of District Authorizing Law Redevelopment HRA (Minnesota Statutes Sections 462.545 and 462.585) August 1, 2009 $25,176 $134,417 $109,241 $1,070,000 $1,070,000 Duration of District Original Tax Capacity Current Tax Capacity (for taxes collectible in 2002) Captured Tax: Capacity Retained Bonds Issued Principal Payments Bonds Outstanding at December 31, 2002 D. 1989 Multi-Use Redevelopment Plan K2 Type of District Authorizing Law Redevelopment HRA (Minnesota Statutes Sections 462.545 and 462.585) October 4, 2014 $4,955 $22,886 Duration of District Original Tax Capacity Current Tax Capacity (for taxes collectible in 2002) Prior Year Tax Capacity Adjustment Captured Tax Capacity Retained Bond'i Issued Principal Payments Bonds Outstanding at December 31, 2002 $17,931 E. 1995 Sheffield Tax Increment Financing District M8 Type of District Authorizing Law Redevelopment HRA (Minnesota Statutes Sections 469.174 to 469.179 inclusion as amended) December 31, 2022 SI7,773 $52,336 $34,563 Duration of District Original Tax Capacity Current Tax Capacity (for taxes collectible in 2002) Captured Tax Capacity Retained Prior Year Tax Capacity Adjustment Bonds Issued Principal Payments Bonds Outstanding at December 31, 2002 77 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31 , 2002 F. 53rd A venue Tax Increment Financial District N7 Type of District Authorizing Law Economic Development Minnesota Statutes Section 469.174 Duration of District Original Tax Capacity Current Tax Capacity (for taxes collectible in 2002) Captured Tax Capacity Retained Bond~ Issued Principal Payments Bonels Outstanding at December 31, 2002 December I I, 2006 $ 66,238 $ I 74,502 $108,264 G. Housing and Redevelopment District No.1 P3 Type of District Authorizing Law Redevelopment Minnesota Statutes Section 469.1 74 Duration of District Original Tax Capacity Current Tax Capacity (for taxes collectible in 2002) Captured Tax Capacity Retained Bonds Issued Principal Payments Bonds Outstanding at December 3 I, 2002 September 8, 2002 $32,520 $48,957 $16,437 H. Housing and Redevelopment District No.1 P4 Type of District Authorizing Law Redevelopment Minnesota Statutes Section 469.174 Duration of District Original Tax Capacity Current Tax Capacity (for taxes collectible in 2002) Captured Tax Capacity Retained Bond~ Issued Principal Payments Bond~ Outstanding at December 31, 2002 September 8, 2002 51,1 [7 S 1 ,623 $ 506 78 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 3 1 , 2002 l. Housing and Redevelopment District R8 Type of District Authorizing Law Redevelopment Minnesota Statutes Section 469.174 Duration of District Original Tax Capacity Current Tax Capacity (for taxes collectible in 2002) Captured Tax Capacity Retained Bonds Issued Principal Payments Bond~ Outstanding at December 31, 2002 December 15,2022 $4,343 $4,351 $ 8 CHANGES IN LONG-TERM LIABILITIES Long-term liability activity for the year ended December 31,2002, is as follows: Beginning Ending Due Within Balance Additions Reductions Balam:e One Year Governmental activities: Bonds payable Capital appreciation bonds 1990 $2,399,721 $ $391.515 $2,008,206 $377,918 Refunding bonds of 1991 220,000 220,000 Improvement bonds: Improvement bonds 1999A 810,000 105,000 705,000 I ()(J,noo Total bonds payable 3,429,721 0 716,515 2,713.206 477,918 Compensated absences 5U9,943 62,347 572.290 724 Total governmental activity long-temlliabilities $3,939,664 $62,347 $716,515 $3,285,496 $478.642 Business-type activities: Revenue bonds: Utility revenue bonds 1999B 1,825,OIKI 175,000 1,650,OlKJ I SO.DOO Compensated absences 88,299 26.485 61.814 1,806 Total business-type activity long-teml liabilities $1.913.299 $0 $201 ,485 $1,711,8[4 $181,806 With the exception of the 1990 Tax Increment Bonds, all General Obligation Bonds are serial bonds which require semiannual payments of principal and/or interest from the date the bonds are issued. The 1990 Tax Increment Bonds are Capital Appreciation Bonds which require no payments of principal or interest until September 2002. During the year ended December 31,2002, accreted interest of $3,078,678 was included in governmental activity long-term debt for the 1990 Tax Increment Capital Appreciation Bonds. 79 CITY OF COL UMBrA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31 , 2002 Note 8 CONDUIT DEBT From time to time, the City of Columbia Heights has issued Revenue Bonds to provide financial assistance to private-sector entities for the acquisition and construction of facilities deemed to be in the public interest. The bonds are secured by the property financed and are payable solely from private-sector entity revenues. Upon repayment of the bonds, ownership of the acquired facilities transfers to the private-sector entity served by the bond issuance. Neither the City of Columbia Heights, the State of Minnesota, nor any political subdivision thereof is obligated in any manner for repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the accompanying financial statements. As of December 31,2002 there were five series of Revenue Bonds outstanding, with an aggregate principal amount payable of $18,844,000. Note 9 FUND EOUITY The following funds had a fund deficit as of December 31,2002: Fund Deficit Special Revenue Funds: Anoka County CDBG ($25,317) Debt Service Funds: Multi-Use Redevelopment Plan (52,579) Capital Project Funds: Muncipal State Aid Street Fund Sheffield TIF Redevelopment Capital Improvements PIR TIF District #2 TlF Scattered Site (725,704) (490,518) (186,426) (2,243 ) (33,603) Total fund deficits ($1,516,390) The City will finance these deficits through external or internal sources in future years. 80 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 At December 31, 2002 the City has reserved and designated portions of its various fund equities through legal restrictions and City Council authorizations. A summary of such reservations and designations are as follows: December 31, 2002 General fund: Reserved for prepayments Designated for working capital Special Revenue Funds: Reserved for prepayments Reserved for real estate held for resale Reserved for program expenditures Designated for working capital Designated for maintenance Debt Service Funds: Designated for debt service Capital Projects Funds: Designated for capital improvements $14,657 3,500,949 4,156 165,836 780,821 46,715 102,590 1,240,225 12,693,268 $18,549,217 81 CITY OF COLUMBIA HEIGHTS, .MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 Note 10 DEFINED BENEFIT PENSION PLANS - STATEWIDE A. PLAN DESCRIPTION All full-time and certain part-time employees of the City of Columbia Heights 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 Statute, 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, firefighters and peace officers who qualify . for membership by statute are covered by the PEPFF. . PERA provides retirement benefits as well as disability benefits to members, and benefits to survivors upon death of eligible members. Benefits are established by state statute, and vest after three years of credited service. The defined retirement benefits are based on a member's highest average salary for any five successive years of allowable service, age, and years of credit at termination of service. Two methods are used to compute benefits for PERF's Coordinated and Basic Plan members. The retiring member receives the higher of a step-rate benefit accrual formula (Method I) or a level accrual formula (Method 2). Under Method I, the annuity accrual rate for a Basic Plan member is 2.2% of average salary for each of the first 10 years of service and 2.7% for each remaining year. The annuity accrual rate for a Coordinated Plan member is 1.2% of average salary for each of the first 10 years and 1.7% for each remaining year. Under Method 2, the annuity accrual rate is 2.7% of average salary for Basic Plan members and 1.7% for Coordinated Plan members for each year of service. For PEPFF members, the annuity accrual rate is 3.0% for each year of service. For all PEPFF and PERF members whose annuity is calculated using Method 1, a full annuity is available when age plus years of service equal 90. A reduced retirement annuity is also available to eligible members seeking early retirement. There are different types of annuities available to members upon retirement. A normal annuity is a lifetime annuity that ceases upon the death of the retiree - no survivor annuity is payable. There are also various types of joint and survivor annuity options available which will reduce the monthly normal annuity amount, because the annuity is payable over joint lives. Members may also leave their contributions in the fund upon termination of public service in order to qualify for a deferred annuity at retirement age. Refunds of contributions are available at any time to members who leave public service, but before retirement benefits begin. The benefit provisions stated in the previous paragraphs of this section are current provisions and apply to active plan participants. Vested, terminated employees who are entitled to benefits but R? CITY OF COLUMBIA HEIGHTS, lYllNNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 are not receiving them yet are bound by the provisions in effect at the time they last terminated their public service. PERA issues a publicly available financial report that includes financial statements and required supplementary information for PERF and PEPFF. That report may be obtained by writing to PERA, 60 Empire Drive #200, St. Paul, Minnesota, 55103-1855 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% and 5.10%, respectively, of their annual covered salary. The PEPFF members are required to contribute 6.20% of their annual covered salary. The City of Columbia Heights is required to contribute the following percentages of annual covered payroll: 11.78% for Basic Plan PERF members, 5.53% for Coordinated Plan PERF members, and 9.30% for PEPFF members. The City's contributions for the last three years which were equal to the contractually required contributions for each year as set by state statute are as follows: Year Ended December 31 2000 2001 2002 PERF $173,674 175,714 210,066 PEPFF $160,999 172,261 185,404 In addition to the above amount, the City contributed $325,675 to PEPFF as required under a 1999 consolidation plan. Note 11 DEFINED BENEFIT PENSION PLAN - POLICE AND FIRE CONSOLIDATION FUND TERMITNATEDPLAN-PFCF Until July I, 1999, the City of Columbia Heights was a participant in the PERA Police and Fire Consolidation Fund (PFCF), an agent, multiple-employer defined benefit plan. Effective July I, 1999 this plan was terminated and all assets and liabilities were transferred to the Police and Fire Fund (PEPFF), a cost sharing multiple-employer plan. Upon termination, a final actuarial valuation determined the unfunded actuaJial accrued liability (UAAL) for each participant. The City of Columbia Heights' remaining obligation to the PFCF is repayment ofthe UAAL, which is payable in 10 equal annual installments from 1999 - 2009. Annual payments for the City of Columbia Heights are $56,706 for the fire and police accounts. During 2002, it was decided that the entire outstanding amount of $325,675 was to be paid ofl~ 83 CITY OF COLUMBIA HEIGHTS, l\UNNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 Note 12 DEFINED CONTRIBUTION PLAN - FIRE RELIEF ASSOCIATION. VOLUNTEER DIVISION PLAN DESCRIPTION The Columbia Heights Fire Department Relief Association is the administrator of a single-employer pension plan for the volunteer members of the City of Columbia Heights Fire Department. Through October 26, 1997, the association operated as a defined benefit plan. Effective October 27, 1997, the association amended its by-laws and converted to a defined contribution plan. The pension plan was fully funded at the time of conversion. Benefits and contribution requirements are established by the association's by-laws and can be amended by the association's board of directors with approval from the City of Columbia Heights. All provisions are within limitations established by Minnesota statutes. Tvpe of Benefit. The exclusive pension provided by the association is a "Defined Contribution Lump Sum Service Pension" as defined in Minnesota Statutes g424A.02, Subdivision 4. Contributions Required and Contributions Made. No contributions are required from the plan members or the City of Columbia Heights. The plan is funded through state aid, investment income and discretionary contributions from the City of Columbia Heights. For 2002 state aid was contributed to the plan. Note 13 COMMITMENTS AND CONTINGENCIES A. RISK MANAGEMENT The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. Workers compensation coverage is provided through a pooled self-insurance program through the League of Minnesota Cities Insurance Trust (LMCIT). The City pays an annual premium to LMCIT. The City is subject to supplemental assessments if deemed necessary by the LMCIT. The LMCIT reinsures through Workers Compensation Reinsurance Association (WCRA) as required by law. For workers compensation, the City is not subject to a deductible. The City's workers compensation coverage is retrospectively rated. With this type of coverage, final premiums are determined after loss experience is known. The amount of premium adjustment, if any, is considered immaterial and not recorded until received or paid. Property, casualty, and automobile insurance coverage are provided through a pooled self- insurance program through the LMCIT. The City pays an annual premium to the LMCIT. The City is subject to supplemental assessments if deemed necessary by the LMCIT. The LMCIT 84 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 reinsures through commercial companies for claims in excess of various amounts. The City retains risk for the deductible portions. These deductibles are considered immaterial to the financial statements. The City continues to carry commercial insurance for all other risks of loss, including employee health and disability insurance. There were no significant reductions in insurance from the previous year or settlements in excess of insurance coverage for any of the past three fiscal years. B. LITIGA TION The City attorney has indicated that any existing and pending lawsuits, claims and other actions in which the City is a defendant are either covered by insurance; of an immaterial amount; or, in the judgment of the City attorney, remotely recoverable by plaintiffs. C. FEDERAL AND STATE FUNDS Amounts received or receivable from federal and state agencies are subject to agency audit and adjustment Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of funds which may be disallowed by the agencies cannot be determined at this time although the City expects such amounts, if any, to be immaterial. D. TAX INCREMENT DISTRICTS The City's tax increment districts are subject to review by the State of Minnesota Office of the State Auditor (OSA). Any disallowed claims or misuse of tax increments could become a liability of the applicable fund. Management has indicated that they are not aware of any instances of noncompliance which would have a material effect on the financial statements. E. CONTRACTUAL COMMITMENTS The ,City has entered into several contractual commitments that are in process at year end. At December 31, 2002, the City's committed obligation for such projects were approximately $878,184. In addition to these contractual commitments, the City has a contract with the City of Minneapolis for the purchase of the City's water supply. This water supply flows through one master meter located at the City of Minneapolis reservoir. During the years 2000, 200 I and 2002 there were periods of time where the meter was dysfunctional and it was necessary for Minneapolis to estimate the water flowage. Due to the age of the meter, there are also some concerns as to its 85 CITY OF COLUlVIBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 overall accuracy, a result of which could be that the City was billed for less water than was actually consumed which could result in an outstanding liability to the City of Minneapolis. At the present time there is not adequate information to determine the full extent of any potential contingent liability. Note 14 CHANGE IN ACCOUNTING PRINCIPLE In June 1999, the Governmental Accounting Standards Board (GASB) approved Statement No. 34, Basic Financial Statements - and Management's Discussion and Analysis - for State and Local Govemments. The City is required to implement GASB 34 no later than the year ended December 31, 2003. The City elected to implement GASB 34, including the infrastructure-related portion, during 2002. The most significant effects of implementing GASB 34 during 2002 are as follows: .. Government-wide financial statements are prepared using full accrual accounting for all the City's activities. .. Infrastructure and construction in progress for governmental activities has been capitalized and all capital assets are depreciated on the government-wide financial statements. See Note 4 for restatement of previously reported amounts. .. The basic fund financial statements focus on major funds rather than fund types. .. A Management Discussion and Analysis (MD&A) is included as required supplementary information. These and other changes are reflected in the accompanying financial statements (including notes to the financial statements). The City also implemented the following pronouncements during 2002, which did not have a material effect on the accompanying financial statements: · GASH Statement 33, AccoUllting and Financial Reporting for Nonexchange Transactions .. GASH Statement 36, Recipient Reportingfof Certain Shared Nonexchange Revenues - an Amendment to GASB Statement 33 · GASB Statement 37, Basic Financial Statements - and Management's Discussion and Analysis- for State and Local Goveml1lelZts: Omnibus - an Amendment of GASB Statements No. 21 and No. 34. · GASH Statement 38, Certain Financial Statement Note Disclosures · GASH Statement 39, Determining Whether Certain Organizations are Component Units .. GASB Statement 41, Budgetary Comparison Schedules - Perspective D~ffefellces 86 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2002 Note 15 FUND RECLASSIFICATIONS The following funds have been reclassified from Special Revenue funds to Capital Project Funds: · Municipal State Aid Street Fund · Parking Ramp Fund · Housing Mortgage Fund Note 16 SUBSEOUENT EVENTS In 2003, $2,600,000 in General Obligation Improvement Bonds were issued. 87 88 REQUIRED SUPPLEMENTARY INFORMATION 89 CITY OF COLUMBIA HEIGHTS, MINNESOTA REQUIRED SUPPLEMENT AR Y INFORMATION BUDGETARY COMPARISON SCHEDULE - GENERAL FUND For The Year Ended December 31, 2002 With Comparative Totals For The Year Ended December 31, 2001 Statement 10 Page 1 of2 2002 Variance with Budgeted Amounts Final Budget 2001 Actual Positive Actual Original Final Amounts (Negative) Amounts Revenues: Taxes $4,095,527 $3,525,375 $3,534,854 $9,479 $2,954,511 Licenses and permits 304,] 00 304,1 00 277,924 (26,]76) 292,744 Intergovernmental 2,834,820 3,404,972 3,446,083 41,1]] 3,660,019 Charges for services 419,400 419,400 414,739 (4,661) 390,492 Fines and forfeitures 100,000 100,000 84,346 (15,654) 87,760 Investment income: Interest and dividends 200,000 200,000 278,819 78,819 254,660 Change in fair value 68,523 68,523 19,113 Other revenues: Miscellaneous 6,600 6,600 5,903 ( 697) 5,942 Proceeds from sale of assets 5,500 5,500 12,454 6,954 15,430 Total revenues 7,965,947 7,965,947 8,123,645 157,698 7,680,671 Expenditures: General government: Council 207,242 207,242 198,755 8,487 189,810 Manager 403,841 403,841 363,241 40,600 348,264 Legal 194,010 194,010 169,498 24,512 183,899 Finance and elections 646,820 646,820 6] 9,584 27,236 532,814 Assessing 141,620 141,620 110,272 31,348 125,027 General government buildings 142,216 142,216 114,155 28,061 1]7,76] Total general government 1,735,749 1,735,749 1,575,505 160,244 1,497,575 Public safety: Police/animal/civil defense 2,549,938 2,581,500 2,500,331 81,169 2,291,754 Fire 843,223 843,223 880,562 (37,339) 864,303 Total public safety 3,393,]61 3,424,723 3,380,893 43,830 3,156,057 Public works: Engineering 314,440 314,440 231 ,4 79 82,96 ] 419,446 Maintenance 878,359 878,359 721,077 157,282 707,652 Sanitation 121,689 12] ,689 121,921 (232) 95,092 Total public works 1,314,488 1,314,488 ] ,074,477 240,0 I ] 1,222,190 Other departments: Parks and recreation 1,352,448 1,352,448 I ,213,016 139,432 1,194,800 Contingencies 27,500 27,500 27,500 3,922 Total other departments 1,379,948 1,379,948 1,213,016 166,932 1,198,722 Total expenditures 7,823,346 7,854,908 7,243,891 611,017 7,074,544 Revenues over (under) expenditures 142,60 I 111,039 879,754 768,715 606,127 90 CITY OF COLUMBIA HEIGHTS, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE - GENERAL FUND F or The Year Ended December 31, 2002 With Comparative Totals For the Year Ended December 31,2001 Statement 10 Page 2 of2 2002 Original Final Actual Amounts Variance with Final Budget Positive (Negative) 2001 Actual Amounts Budgeted Amounts Other financing sources (uses): Transfers in 532,032 532,032 670,769 138,737 429,968 Transfers out ( 400,000) (1,840,052) (1,932,293) (92,241 ) (1,940,137) Total other financing sources and (uses) 132,032 (1,308,020) (1,261,524 ) 46,496 (1,510,169) Net change in fund balances $274,633 ($ 1,196,981) (381,770) $815,211 (904,042) FlU1d balance - beginning 3,897,376 4,801,418 FlU1d balance - ending $3,515,606 $3,897,376 91 CITY OF COLUMBIA HEIGHTS, MINNESOTA REQUIRED SUPPLEMENT AR Y INFORMATION BUDGETARY COMPARISON SCHEDULE - ANOKA COUNTY CDBG For The Year Ended December 31, 2002 With Comparative Totals For The Year Ended December 31,200 I Statement 11 2002 Variance with Budgeted Amounts Final Budget- 2001 Actual Positive Actual Original Final Amounts (Negative) Amounts Revenues: Intergovernmental revenue $377,787 $377,787 $383,183 $5,396 $490,829 Other revenues: Miscellaneous 196 Proceeds from sale of assets 37,650 Total revenues 377,787 377,787 383,183 5,396 528,675 Expenditures: Personal services 13,437 13,437 3,204 10,233 12,877 Supplies 25 25 146 (121) 388 Other services and charges 17,301 17,301 7,097 10,204 53,644 Loans and grants 405,447 (405,447) 241 , I 00 Capital outlay 341, III 341,11] 341 ,111 191,270 Total expenditures 371,874 371,874 415,894 (44,020) 499,279 Revenues over (under) expenditures 5,913 5,913 (32,711) (38,624) 29,396 Other financing sources (uses): Transfers (out) (5,913) (5,913) (5,913) Total other financing sources (uses) (5,913) (5,913) (5,913) 0 0 Net change in fund balance $0 $0 (38,624) ($38,624) 29,396 Fund balance (deficit) - beginning 13,307 ( 16,089) Fund balance (deficit) - ending ($25,317) $13,307 92 CITY OF COLUMBIA HEIGHTS, MINNESOTA REQUIRED SUPPLEMENT AR Y INFORMATION BUDGETARY COMPARISON SCHEDULE - NOTE TO RSI December 31, 2002 Note A: LEGAL COMPLIANCE - BUDGETS The City of Columbia Heights' budget is legally adopted on a basis consistent with generally accepted accounting principals. The legal level of budgetary control is at the fund level. The following is a listing of funds whose actual expenditures exceeded budgeted expenditures (appropriations) in the following funds for 2002: Final Budget Actual Over Budget Major Fund: Anoka County CDBG $37 I ,874 $415,894 $44,020 Expenditures in the Anoka County CDBG Fund are over budget by $44,020 due to the purchase of properties. This was not included in the 2002 budget. o 93 94 Statement 15 Page 2 of2 Total Total Housing and Economic Flex Police/Fire Redevelopment Development Benefit Contingency Authority Authority Total $ - $ - $ - $218,075 $809,663 118,602 367,847 238,125 848,254 12,542 259,545 492,592 492,592 1,744 22.691 30,859 31,438 127,842 429 5,577 7,583 7,726 31,418 54,522 3,615 4,210 85,034 43,950 56,695 146,870 902,496 512,116 2,698,298 48,681 I 5,744 25,608 15,374 53,107 735,592 17,160 5,457 183,296 51,447 387,571 423,382 250,376 1,479,496 257,425 257,425 5 I ,447 387,571 713,341 308,940 2,745,842 5,248 (240,701) 189,155 203,176 (47,544) 127,377 423,888 (238,057) (13,798) (490,463) (1,701,985) 0 (238,057) (13,798) (363,086) (1,278,097) 5,248 (478,758) 175,357 (159,910) (l,325,641) 26,494 478,758 440,683 582,376 2,657,397 $31,742 $0 $616,040 $422,466 $1,331,756 113 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - COMMUNITY DEVELOPMENT SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31,2002 With Comparative Totals For the Vear Ended December 31,2001 Statement 16 2002 Variance with Budgeted Amounts Final Budget- 2001 Actual Positi ve Actual Original Final AmOlmts (Negative) Amounts Revenues: Investment income: Interest and dividends $ - $ - $1,242 $1,242 $9,300 Change in fair value 305 305 698 Total revenues 0 0 1,547 1,547 9,998 Expenditures: Personal servi ces 253,414 253,414 245,345 8,069 231,152 Supplies 13,715 ] 3,715 8,635 5,080 3,851 Other services and charges 38,008 38,008 43,652 (5,644) 20,998 Capital outlay 500 500 500 2,386 Total expenditures 305,637 305,637 297,632 8,005 258,387 Revenues over (under) expenditures (305,637) (305,637) (296,085) 9,552 (248,389) Other financing sources (uses): Transfers in 284,702 284,702 284,702 275,112 Transfers (out) (11,826) (11,826) (11,826) (16,505) Total other financing sources (uses) 272,876 272,876 272,876 0 258,607 Net change in fund balance ($32,76]) ($32,761 ) (23,209) $9,552 10,218 Fund balance - beginning 36,456 26,238 Fund balance - ending $13,247 $36,456 114 COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES 95 96 NONMAJOR GOVERNMENTAL FUNDS 97 98 SPECIAL REVENUE FUNDS A Special Revenue Fund is used to account for the proceeds of special revenue sources that are legally restricted to expenditures for specified purposes. DEBT SERVICE FUNDS The Debt Service Funds are used to account for the accumulation of resources for, and payment of, interest, principal, and related costs on general long-term debt. CAPITAL PROJECT FUNDS The Capital Projects Funds account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by proprietary funds. 99 100 NONMAJOR SPECIAL REVENUE FUNDS The City of Columbia Heights had the following Special Revenue Funds during the year: Community Development Fund - established to account for revenues and expenditures associated with planning, building inspections, and community development projects within the City. Cable Television Fund - established to account for revenues and expenditures associated with cable television franchise. Library Fund - established III 1993 to account for revenues and expenditures of the Ii b fary. DARE Program Fund - established to account for revenues and expenditures of DARE (Drug Awareness) Program. Special Proiects Fund - established to monitor revenues from special projects and related expenditures. CHASE Fund - estab lished to account for revenues and expenditures associated with a State grant received for community participation in youth enrichment programs. Confiscated Property Fund - established to account for funds from property confiscated by the Police Department. Local Law Enforcement Block Grant Fund - established to account for revenues and expenditures associated with a federal grant received for the purchase of equipment to aid in crime prevention. COPS MORE 96 Grant - established to account for revenues and expenditures associated with a federal grant received for technical service equipment and personne1. Juvenile Justice Grant - established to account for revenues and expenditures associated with the removal of graffiti in the City. COPS School Partnership Grant - established to account for revenues and expenditures associated with a federal grant received to address identified crime problems within the schools. 101 102 Recreation Contributed Proiects Fund - established to monitor contributions for recreational activities and related expenditures. Contributed Proiects Fund - established to monitor contributions and related expenditures. Flex Benefit - established to account for contributions by employees and related expenditures for flexible benefits. Police/Fire Contingency Fund - established to account for future years expenditures related to police and fire. Housing and Redevelopment Authority- a separate legal entity from the City. The mayor and City Council comprise the majority membership of this component unit. Its purpose is to provide housing in the City. Parkview Villa North Fund - established to account for revenues and expenditures associated with low-income federally subsidized senior housing. Parkview Villa South Fund - established to account for revenues and expenditures associated with an EDA owned senior housing complex. Rental Housing Fund - established to account for revenues and expenditures of City-owned rental properties. Economic Development Authority - a separate legal entity from the City. The mayor and City Council comprise the majority membership of this component unit. Its purpose is economic development in the City. Economic Development Authority Administration Fund - established to account for revenues and expenditures associated with business development and community redevelopment projects in the City. Business Revolving Loan Fund - established to account for revenues and expenditures associated with business development through a business revolving loan fund. Section 8 Fund - established to account for revenues and expenditures associated with the administration of Section 8 rental assistance programs within the City. 103 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS December 31, 2002 Statement 12 Total Nonmajor Special Debt Capital Government Assets Revenue Service Project Funds Cash and investments $1,583,722 $1,162,995 $5,701,833 $8,448,550 Receivables: Accounts 48,087 48,087 Taxes 3,703 12,603 205 16,5 11 Interest 27,092 22,067 34,366 83,525 Loans 10,433 10,433 Due from other governmental units 255,242 3,039 258,281 Interfimd receivable 52,572 157,564 210,136 Prepayments 4,156 4,156 Real estate held for resale 165,836 165,836 Total assets $2,098,271 $1,250,237 $5,897,007 $9,245,515 Liabilities and Fund Balance Liabilities: Accounts payable $475,859 $ - $62,371 $538,230 Accrued salaries and withholdings payable 11,027 11 ,027 Contracts payable - retained percentage 1,000 1,000 Due to other governmental units 43,033 7 43,040 Interfund payable 173,870 52,572 37,243 263,685 Deferred revenue 40,746 10,0[2 50,758 Deposi ts 21,980 21 ,980 Total liabilities 766,515 62,591 100,614 929,720 Fund balance: Reserved: Reserved for prepayments 4,156 4,156 Reserved for real estate held for resale 165,836 165,836 Reserved for program expenditures 780,821 780,821 Unreserved: Designated for working capital 46,7 1 5 46,715 Designated for maintenance 102,590 102,590 Designated for debt service 1,240,225 1,240,225 Designated for capital improvements 5,148,402 5,148,402 Undesignated 231,638 (52,579) 647,991 827,050 Total fund balance 1,331,756 1,187,646 5,796,393 8,315,795 Total liabilities and flmd balance $2,098,271 $1,250,23 7 $5,897,007 $9,245,515 104 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NON MAJOR GOVERNMENTAL FUNDS For The Year Ended December 31,2002 Statement 13 Total Nonmajor Special Debt Capital Government Revenues: Revenue Service Project Funds Taxes $809,663 $ - $ - $809,663 Tax increment collections 627,090 133,434 760,524 Intergovernmental 848,254 84,919 6,935 940,108 Charges for services 752,137 752,137 Investment income: Interest and dividends 127,842 104,135 162,176 394,153 Change in fair value 31,418 25,592 39,856 96,866 Other revenues 128,984 25,563 154,547 Total revenues 2,698,298 841,736 367,964 3,907,998 Expenditures: Current: General government 292,970 292,970 Public safety 448,285 448,285 Culture and recreation 684,674 684,674 Community development 1,062,488 1,062,488 Capital outlay: Public safety 70,591 70,591 Culture and recreation 26,610 26,610 Community development 257,425 257,425 Debt service: Principal retirement 716,5 I 5 716,515 Interest and fiscal charges 530,985 530,985 Miscellaneous 30,237 30,237 Developer incentives 104,258 104,258 Contractual services 66,885 66,885 Total expenditures 2,745,842 1,277,737 268,344 4,291,923 Revenues over (under) expenditures (47,544) (436,001) 99,620 (383,925) Other financing sources (uses): Transfers in 423,888 1,182,851 2,030,225 3,636,964 Transfers out (1,701,985) (1,112,130) (220,485) (3,034,600) Total other financing sources (uses) (l,278,097) 70,721 1,809,740 602,364 Net change in fimd balance (1,325,641 ) (365,280) 1,909,360 218,439 Fund balance - beginning 2,657,397 1,552,926 3,887,033 8,097,356 FlU1d balance - ending $1,331,756 $1,187,646 $5,796,393 $8,315,795 105 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS December 31, 2002 Community Development Cable Fund Television Library Assets Cash and investments $22,057 $ - S56,048 Receivables: Accounts 32,215 Taxes Interest 263 3,375 1,217 Loans Due from other governmental units Prepayments 4,156 Real estate held for resale Total assets $22,320 $35,590 $61,421 Liabilities and Fund Balance Liabilities: AccOlmts payable $3,137 $4,081 $1,559 Accrued salaries and withholdings payable 3,956 6,273 Due to other governmental units 1,980 2,718 Internmd payable 29,070 Deferred revenue Deposi ts Total liabilities 9,073 33,151 10,550 Fund balance: Reserved for prepayments 4,] 56 Reserved for real estate held for resale Reserved for program expenditures Unreserved: Designated for working capital 46,715 Designated for maintenance Undesignated 13,247 2,439 Total fund balance 13 ,247 2,439 50,87l Total liabilities and fund balance $22,320 535,590 $61,4 21 106 Statement 14 Page 1 of2 Local Law D.A.R.E. Special Confiscated Enforcement Program Projects C.H.A.S.E. Property Block Grant $20,573 $1,976 $35,641 $13,121 $23,290 15,184 3,288 300 269 13,990 $20,573 $20,448 $49,931 $13,121 $23,559 $ - $4,762 $ - 444 $ - $ - 10,969 17,048 o 15,731 444 o 17,048 20,573 20,573 4,717 4,717 49,487 49,487 13,121 13,121 6,511 6,511 $20,573 $20,448 $49,931 $13,121 $23,559 107 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS December 31,2002 Assets Cash and investments Receivables: Accounts Taxes Interest Loans Due from other governmental units Prepayments Real estate held for resale Total assets Liabilities and Fund Balance Liabilities: Accounts payable Accrued salaries and withholdings payable Due to other governmental units Interfund payable Defen-ed revenue Deposits Total liabilities Fund balance: Reserved for prepayments Reserved for real estate held for resale Reserved for program expenditures Unreserved: Designated for working capital Designated for maintenance Undesignated Total fund balance Total liabilities and fund balance COPS More 96 Grant $314 $314 s . - 314 314 $314 108 Juvenile Justice Gran t $340 623 $963 $ - o 963 963 $963 Recreation Contributed Projects $71 ,050 $71,050 $125 o 125 70,925 70,925 $71,050 Statement 14 Page 2 of2 Total Total Housing and Economic Contributed Flex Police/Fire Redevelopment Development Projects Benefit Contingency Authori ty Authority Total $29,772 $39,321 $264,160 $610,148 $395,911 $1,583,722 688 48,087 3,703 3,703 370 4,809 6,539 6,662 27,092 10,433 10,433 240,629 255,242 4,156 144,723 21,113 165,836 $29,772 $39,691 $268,969 $1,002,727 $437,822 $2,098,271 $],432 $7,949 $268,969 $18] ,468 $2,377 $475,859 104 250 ] ] ,027 38,335 43,033 144,800 173,870 12,729 40,746 21,980 21,980 1,432 7,949 268,969 386,687 15,356 766,515 4,156 144,723 21,113 165,836 474,393 306,428 780,821 46,715 ] 02,590 102,590 28,340 31,742 (105,666) 94,925 231,638 28,340 31,742 0 616,040 422,466 1,331,756 $29,772 $39,691 $268,969 $1,002,727 $437,822 $2,098,271 109 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR SPECIAL REVENUE FUNDS For The Year Ended December 31,2002 Community Development Cable D.A.R.E. Fund Television Library Program Revenues: Taxes $ - 5> - $591,588 $ - Intergovernmental Fees/program revenues 129,386 17,522 Rents Investment income: Interest and dividends 1,242 15,925 5,744 Change in fair value 305 3,914 1,411 Other revenues: Miscellaneous 18,827 Contributions 526 Total revenues 1,547 168,052 616,265 526 Expenditures: Parks and recreation: Personal services Supplies Other services and charges Other: Personal services 245,345 1,973 415,421 Supplies 8,635 2,302 104,984 2,381 Other services and charges 43,652 144,927 74,236 2,4 70 Capital outlay Total expenditures 297,632 149,202 594,641 4,851 Revenues over (under) expenditures (296,085) 18,850 21,624 ( 4,325) Other financing sources (uses): Transfers in 284,702 9,000 Transfers (out) (11,826) (408,549) (209,292) Total other financing sources (uses) 272,876 ( 408,549) (209,292) 9,000 Net change in fimd balance (23,209) (389,699) (187,668) 4,675 Fund balance - beginning 36,456 392,138 238,539 15,898 Fund balance - ending $13,247 $2,439 $50,871 $20,573 110 Statement 15 Page 1 of2 Local Law COPS Special Confiscated Enforcement More 96 Proj ects C.H.A.S.E. Property Block Grant Grant $ - $ - $ - $ - $ - 78,256 26,351 88,714 11,381 15,516 1,414 1,269 3,813 348 312 3,860 108,043 91,399 3,860 27,932 0 111 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NON MAJOR SPECIAL REVENUE FUNDS For The Year Ended December 31,2002 Juvenile Cops School Recreation Justice Partnership Contributed Contributed Gran t Grant Projects Projects Revenues: Taxes $ - $ - $ - $ - Intergovernmental 12,462 6,611 Fees/program revenues Rents Investment income: Interest and dividends Change in fair value Other revenues: Miscellaneous Contributions 29,145 14,279 Total revenues 12,462 6,611 29,145 14,279 Expenditures: Parks and recreation: Personal services Supplies 8,003 Other services and charges 3,438 Other: Personal services 4,372 Supplies 107 1,124 9,654 Other services and charges 9,055 5,487 10,367 Capital outlay Total expenditures 13,534 6,611 11 ,44 I 20,021 Revenues over (under) expenditures (1,072) 0 17,704 (5,742) Other financing sources (uses): Transfers in 893 Transfers (out) Total other financing sources (uses) 893 0 0 0 Net change in fimd balance (179) I 7,704 (5,742) Fund balance - beginning ],142 53,221 34,082 Fund balance - ending $963 $0 $70,925 $28,340 112 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - CABLE TELEVISION FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2002 With Comparative Totals For the Year Ended December 31, 2001 Statement 17 2002 Variance with Budgeted Amounts Final Budget- 2001 Actual Positive Actual Original Final Amounts (Negative) Amounts Revenues: Franchise fees $128,000 $128,000 $129,386 $1,386 $134,502 Investment income: Interest and dividends 10,000 10,000 15,925 5,925 20,977 Change in fair value 3,914 3,914 1,574 Other revenues: Miscellaneous 18,827 18,827 29,827 Total revenues 138,000 138,000 168,052 30,052 186,880 Expenditures: Personal services 6,431 6,43 r 1,973 4,458 1,828 Supplies 55,550 55,550 2,302 53,248 1,267 Other services and charges 42,366 42,366 144,927 (102,561) 23,185 Total expenditures 104,347 104)47 149,202 (44,855) 26,280 Revenues over (under) expenditures 33,653 33,653 18,850 (14,803 ) 160,600 Other financing sources (uses): Transfers (out) (108,549) ( 408,549) ( 408,549) (104,333) Net change in fund balance ($74,896) ($374,896) (389,699) ($14,803 ) 56,267 Fund balance - beginning 392,138 335,871 Fund balance - ending $2,439 $392,138 115 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - LIBRARY FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2002 With Comparative Totals For the Year Ended December 31,200 I Statement 18 2002 Variance with Budgeted Amounts Final Budget- 2001 Actual Positive Actual Original Final Amounts (Negative) Amounts Revenues: Taxes S591,588 S591,588 S591,588 $ - $547,767 Charges for services 21,700 21,700 17,522 (4,178) 17,725 Investment income: Interest and dividends 5,000 5,000 5,744 744 6,922 Change in fair value 1,411 1,411 519 Other revenues: Miscellaneous 250 250 (250) 230 Total revenues 6 18,538 618,538 616,265 (2,273 ) 573,163 Expenditures: Personal services 412,645 412,645 415,421 (2,776) 383,086 Supplies 91,650 91,650 104,984 (13,334) 90,197 Other services and charges 72,015 72,015 74,236 (2,221) 71,728 Capital outlay 23,800 23,800 23,800 7,761 Total expenditures 600,110 600,110 594,641 5,469 552,772 Revenues over expenditures 18,428 18,428 21,624 3,196 20,391 Other financing sources (uses): Transfers (out) (9,292) (209,292) (209,292) (8,727) Net change in fund balance $9,136 ($190,864 ) (187,668) $3,196 11,664 Fund balance - beginning 238,539 226,875 FW1d balance - ending $50,871 $238,539 116 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - D.A.R.E. PROGRAM SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2002 With Comparative Totals For the Year Ended December 31,2001 Statement 19 2002 Variance with Budgeted Amounts Final Budget- 2001 Actual Positive Actual Original Final Amounts (Negative) Amounts Revenues: Contributions $0 $0 $526 $526 $63 Expenditures: Supplies 5,850 5,850 2,381 3,469 3,288 Other services and charges 2,975 2,975 2,470 505 2,844 Total expenditures 8,825 8,825 4,851 3,974 6,132 Revenues over (under) expenditures (8,825) (8,825 ) (4,325) 4,500 (6,069) Other financing sources: Transfers in 9,000 9,000 9,000 6,000 Net change in flmd balance $175 $175 4,675 $4,500 (69) Food balance - beginning 15,898 15,967 Flmd balance - ending $20,573 $ I 5,898 117 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - SPECIAL PROJECTS SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31, 2002 With Comparative Totals For the Year Ended December 31,2001 Statement 20 2002 2001 Revenues: Fees/program revenue $88,714 S 127,215 Investment income: Interest and dividends 15,516 12,887 Change in fair value 3,813 967 Total revenues 108,043 141,069 Expenditures: Other services and charges 72,300 25,000 Total expenditures 72,300 25,000 Revenues over expenditures 35,743 116,069 Other financing sources: Transfers (out) (330,000) Net change in fund balance (294,257) 116,069 Fund balance - beginning 298,974 182,905 Fund balance - ending $4,717 $298,974 118 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - C .H .A .S .E . SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31,2002 With Comparative Totals For the Year Ended December 31, 2001 Statement 21 2002 2001 Revenues: Intergovernmental: State grant $78,256 $105,782 Fees/program revenue 11,381 14,910 Investment income: Interest and dividends 1,414 1,142 Change in fair value 348 86 Total revenues 91,399 121,920 Expenditures: Personal services 48,681 47,298 Supplies 7,741 13,779 Other services and charges 22,170 42,528 Capital outlay 2,177 Total expenditures 78,592 105,782 Net change in fund balance 12,807 16,138 Fund balance - beginning 36,680 20,542 Fund balance - ending $49,487 $36,680 119 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - CONFISCATED PROPERTY SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31,2002 With Comparative Totals For the Year Ended December 31, 200 I Statement 22 Revenues: Other revenue: Confiscated property 2002 2001 $3,860 $9,902 797 801 3]5 1,983 1,112 2,784 2,748 7, I] 8 10,373 3,255 $]3,121 $10,373 Expenditures: Supplies Other services and charges Total expenditures Net change in nmd balance Fund balance - beginning Fund balance - ending 120 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - LOCAL LAW ENFORCEMENT BLOCK GRANT SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE F or The Year Ended December 31, 2002 With Comparative Totals For the Year Ended December 31,2001 Statement 23 2002 2001 Revenues: Intergovernmental: Federal grant $26,351 $32,933 Investment income: Interest and dividends 1,269 1,520 Change in fair value 312 114 Total revenues 27,932 34,567 Expenditures: Supplies 30,695 3,548 Other services and charges 3,91 I 713 Capital outlay 28,316 Total expenditures 34,606 32,577 Revenues over (under) expenditures (6,674) 1,990 Other financing sources: Transfers in 1,916 2,522 Net change in nmd balance (4,758) 4,512 Fund balance - beginning 11,269 6,757 Fund balance - ending $6,511 $11,269 121 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - COPS MORE 96 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE F or The Year Ended December 31, 2002 With Comparative Totals For the Year Ended December 31,2001 Statement 24 2002 2001 $ - S11,330 23 2 0 $11,355 4,550 922 9,720 0 15,192 0 (3,837) 3,787 0 (50) 314 364 $314 $314 Revenues: Intergovernmental: Federal grant Investment income: Interest and dividends Change in fair value Total revenues Expenditures: Supplies Other services and charges Capital outlay Total expenditures Revenues over (under) expenditures Other financing sources: Transfers in Net change in fund balance Frmd balance - beginning Fund balance - endlng 122 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - JUVENILE JUSTICE GRANT SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE F or The Year Ended December 31, 2002 With Comparative Totals For the Year Ended December 31,2001 Statement 25 2002 2001 Revenues: Intergovernmental: State grant $12,462 $8,481 Expenditures: Personal services 4,372 3,210 Supplies 107 368 Other services and charges 9,055 6,001 Total expenditures 13,534 9,579 Revenues over (under) expenditures (l,072) (1,098) Other financing sources: Transfers in 893 1,071 Net change in fund balance (179) (27) . Fund balance - beginning 1,142 1,169 Fund balance - ending $963 $1,142 123 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - COPS SCHOOL PARTNERSHIP GRANT SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31,2002 With Comparative Totals For the Year Ended December 31,2001 Statement 26 2002 2001 Revenues: Intergovernmental: Federal grant $6,611 S50,956 Expenditures: Personal services 23,172 Supplies 1,124 1,026 Other services and charges 5,487 10,778 Capital outlay 15,980 Total expenditures 6,61 I 50,956 Net change in food balance FlU1d balance - beginning Flmd balance" ending $0 SO 1'JA. CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - RECREATION CONTRIBUTED PROJECTS SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE F or The Year Ended December 31 , 2002 With Comparative Totals For the Year Ended December 31,200 I Statement 27 2002 2001 Revenues: Contributions $29,145 $35,420 Miscellaneous 555 Total revenues 29,145 35,975 Expenditures: Supplies 8,003 21, I 08 Other services and charges 3,438 2,738 Capital outlay 6,018 Total expenditures 11,441 29,864 Net change in fund balance 17,704 6, III Fund balance - beginning 53,221 47,110 Fund balance - ending $70,925 $53,221 125 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - CONTRIBUTED PROJECTS SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31,2002 With Comparative Totals For the Year Ended December 31,2001 Statement 28 2002 2001 Revenues: Contributions $14,279 $19,600 Expenditures: Supplies 9,654 78 Other services and charges 10,367 9,207 Capital outlay 10,708 Total expenditures 20,021 19,993 Net change in fund balance (5,742) (393) Fund balance - beginning 34,082 34,4 75 Fund balance - ending $28,340 $34,082 126 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - FLEX BENEFIT FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31, 2002 With Comparative Totals For the Year Ended December 31,2001 Statement 29 2002 2001 Revenues: Other revenue: Flex withholding $54,522 $49,143 Investment Income: Interest and dividends 1,744 1,651 Change in fair value 429 124 56,695 50,918 Expenditures: Other services and charges 51,447 48,400 Total expenditures 51 ,447 48,400 Net change in fund balance 5,248 2,518 Fund balance - beginning 26,494 23,976 Fund balance - ending $31,742 $26,494 127 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - POLICE/FIRE CONTINGENCY SCHEDULE OF REvENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31,2002 With Comparative Totals For the Year Ended December 31, 2001 Statement 30 2002 2001 Revenues: Intergovernmental $118,602 $111 ,249 Investment income: Interest and dividends 22,691 50,412 Change in fair value 5,577 3,784 Total revenues 146,870 165,445 Expenditures: Other services and charges 387,571 I 1 I ,249 Revenues over expenditures (240,70 I) 54,196 Other financing sources (uses): Transfers out (238,057) (500,000) Net change in fund balance (478,758) ( 445,804) Flmd balance - beginning 478,758 924,562 Fund balance - ending $0 $478,758 128 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUNDS - HOUSING AND REDEVELOPMENT AUTHORITY (COMPONENT UNIT) COMBINING BALANCE SHEET December 31, 2002 Statement 31 129 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUNDS - HOUSING AND REDEVELOPMENT AUTHORITY (COMPONENT UNIT) COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31,2002 Statement 32 Parkview Parh.\,iew Villa Villa Rental North South Housing Total Revenues: Intergovernmental revenue $367,847 $ - $ - S367,847 Ren ts 284,198 I 91 ,944 16,450 492,592 Investment income: Interest and dividends 22,613 5,701 2,545 30,859 Change in fair value 5,557 1 ,401 625 7,583 Other revenues: Miscellaneous 2,078 1,342 195 3,615 Total revenues 682,293 200,388 19,815 902,496 Expenditures: Personal services 9, III 6,263 1 5,374 Supplies 10,221 6,359 580 1 7,160 Other services and charges 270,710 141,364 11,308 423,382 Capital outlay 248,336 9,089 257,425 Total expenditures 538,378 163,075 11,888 713,341 Revenues over expenditures 143,915 3 7,31 3 7,927 189,155 Other financing sources (uses): Transfers (out) (7,884 ) (5,914) (13,798) Total other financing sources (uses) (7,884) (5,914) 0 (13,798) Net change in ftmd balance 136,031 31,399 7,927 175,357 Fund balance - beginning 338,362 71,191 31,130 440,683 Flmd balance - ending $474,393 S I 02,590 $39,057 S616,040 130 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - HOUSING & REDEVELOPMENT AUTHORITY- PARKVIEW VILLA NORTH - SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31,2002 With Comparative Totals For the Year Ended December 31, 200 I Statement 33 2002 Variance with Budget Amounts Final Budget- 2001 Actual Positive Actual Original Final Amounts (Negative) Amounts Revenues: Intergovernrnentalrevenue $50,000 $50,000 $367,847 $317,847 $98,791 Ren ts 270,000 270,000 284,198 14,198 266,979 Investment income: Interest and dividends 9,000 9,000 22,613 13,613 17,376 Change in fair value 5,557 5,557 1,304 Other 4,000 4,000 2,078 (1,922) 4,999 Total revenues 333,000 333,000 682,293 349,293 389,449 Expendi tures: Personal services 19,239 19,239 9,111 10,128 10,335 Supplies 30,012 30,012 10,221 19,791 27,200 Other services and charges 293,267 293,267 270,710 22,557 273,412 Capital outlay 32,670 32,670 248,336 (215,666) 18,273 Total expenditures 375,188 375,188 538,378 (163,190) 329,220 Revenues over (under) expenditures (42,188) (42,188) 143,915 186,103 60,229 Other financing sources (uses): Transfers (out) (7,884) (7,884) (7,884) (7,335) Net change in fund balance ($50,072) ($50,072) 136,031 $]86,103 52,894 Fund balance - beginning 338,362 285,468 Fund balance - ending $474,393 $338,362 131 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - HOUSING & REDEVELOPMENT AUTHORITY _ P ARKVIEW VILLA SOUTH - SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL F or The Year Ended December 31, 2002 With Comparative Totals For the Year Ended December 31,2001 Statement 34 2002 Variance with Budgeted Amounts Final Budget- 2001 Actual Positive Actual Original Final Amounts (Negative) AmOlUlts Revenues: Rents $186,800 $186,800 $ I 91 ,944 $5,144 $191,640 Investment income: Interest and dividends 26,000 26,000 5,701 (20,299) 40,612 Change in fair value 1,401 1,401 3,048 Other 4,500 4,500 1,342 (3,158) 1,616 Total revenues 217,300 217,300 200,388 (16,912) 236,916 Expenditures: Personal services 9,410 9,410 6,263 3,147 2,768 Supplies 9,497 9,497 . 6,359 3,138 15,479 Other services and charges 156,436 156,436 141,364 15,072 146,352 Capital outlay 37,330 37,330 9,089 28,241 4,894 Total expenditures 212,673 212,673 163,075 49,598 169,493 Revenues over expenditures 4,627 4,627 37,313 32,686 67,423 Other financing sources (uses): Transfers (out) (5,914) (5,914) (5,914) (703,670) Net change in fund balance ($1,287) ($1,287) 31,399 $32,686 (636,247) Fund balance - beginning 7],191 707,438 Fund balance - ending $102,590 $71,191 132 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - HOUSING & REDEVELOPMENT AUTHORITY - RENTAL HOUSING - SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31,2002 With Comparative Totals For the Year Ended December 31,2001 Statement 35 133 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUNDS - ECONOMIC DEVELOPMENT AUTHORITY (COMPONENT UNIT) COMBINING BALANCE SHEET December 31, 2002 Statement 36 Economic Business Development Revolving Authority Loan Administration Fund Total Assets Cash and investments $94,670 $301,241 $395,911 Receivables: Taxes 772 2,931 3,703 Interest 1,423 5,239 6,662 Loans 10,433 10,433 Real estate held for resale 21,113 21,113 Total assets $96,865 $340,957 $437,822 Liabilities and Fund Balance Liabilities: Accounts payable $2,377 $ - $2,377 Accrued salaries and withholdings payable 250 250 Deferred revenue 12,729 12,729 Totall1abilities 2,627 12,729 15,356 Fund balance: Reserved for real estate held for resale 21,113 21,1]3 Reserved for program expenditures 306,428 306,428 Unreserved: Undesignated 94,238 687 94,925 Total fund balance 94,238 328.228 422,466 Total liabilities and flmd balance $96,865 $340,957 $437,822 134 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUNDS - ECONOMIC DEVELOPMENT AUTHORITY (COMPONENT UNIT) COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE F or The Year Ended December 31, 2002 Statement 37 Economic Business Development Revolving Authority Loan Administration Fund Section 8 Total Revenues: Taxes S119,834 $98,241 .$ - $218,075 Intergovernmental revenue 209,650 12,944 15,531 238,125 Fees/program revenues 12,542 12,542 Investment income: Interest and dividends 6,715 24,723 31,438 Change in fair value 1,650 6,076 7,726 Other revenues: Miscellaneous 4,210 4,210 Total revenues 342,059 154,526 15,531 512,116 Expenditures: Personal services 53,107 53,107 Supplies 5,457 5,457 Other services and charges 40,714 12 40,726 Loans and grants 209,650 209,650 Total expenditures 308,928 12 0 308,940 Revenues over expenditures 33,131 154,514 15,53 J 203,176 Other financing sources (uses): Transfers in 17,500 24,000 85,877 127,377 Transfers (out) (107,884) (382,579) ( 490,463) Total other financing sources (uses) (90,384) (358,579) 85,877 (363,086) Net change in fund balance (57,253 ) (204,065) 101,408 (159,910) Fund balance (deficit) - beginning 151,491 532,293 (101,408) 582,376 Fund balance - ending $94,238 $328,228 $0 $422,466 135 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - ECONOMIC DEVELOPMENT AUTHORITY _ EDA ADMINISTRA nON - SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL F or The Year Ended December 31, 2002 With Comparative Totals For the Year Ended December 31, 2001 Statement 38 2002 Variance with Budgeted Amounts Final Budget- 2001 Actual Positive Actual Original Final Amounts (Negative) Amounts Revenues: Taxes $137,015 $137,015 $119,834 ($17,181) $118,508 Intergovernmental revenue 209,650 209,650 335,350 Fees/program revenues 140 Investment income: Interest and dividends 6,715 6,715 Change in fair value 1,650 1,650 Other revenues: M iscel laneous 4,210 4,210 15,986 Total revenues 137,015 137,015 342,059 205,044 469,984 Expenditures: Personal services 75,828 75,828 53,107 22,721 31,403 Supplies 3,570 3,570 5,457 (1,887) 1,217 Other services and charges 49,733 49,733 40,714 9,019 60,710 Loans and grants 209,650 (209,650) 335,350 Total expenditures 129,131 129,13 ] 308,928 (1 79,797) 428,680 Revenues over expenditures 7,884 7,884 33,13 ] 25,247 41,304 Other financing sources (uses): Transfers in 17,500 17,500 Transfers (out) (7,884) ( 1 07,884 ) ( 107,884) (22,281) Total other financing sources (uses) (7,884 ) (107,884) (90,384) 17,500 (22,281) Net change in fund balance $0 ($100,000) (57,253) $42,747 19,023 Flmd balance - beginning 151,491 132,468 Fund balance - ending $94,238 $151,491 136 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - ECONOMIC DEVELOPMENT AUTHORITY BUSINESS REVOLVING LOAN FU.ND: SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2002 With Comparative Totals For the Year Ended December 31, 2001 Statement 39 2002 Variance with Budgeted Amounts Final Budget- 2001 Actual Positive Actual Original Final Amounts (Negative) Amounts $111,702 $111,702 $98,241 ($13,461 ) $94,499 12,944 12,944 12,903 12,542 12,542 29,828 24,723 24,723 25,374 6,076 6,076 1 ,904 111,702 111,702 154,526 42,824 164,508 Revenues: Taxes In tergovernmental Fees/program revenues Investment income: Interest and dividends Change in fair value Total revenues Expenditures: Other services and charges Total expenditures 12 (12) 0 0 12 (12) 111,702 111,702 154,514 42,812 24,000 24,000 (I I 1,702) (382,579) (382,579) (111,702) (382,579) (358,579) 24,000 $0 ($270,877) (204,065) $66,812 532,293 $328,228 4,223 4,223 Revenues over expenditures 160,285 Other financing sources (uses): Transfers in Transfers (out) Total other financing sources (uses) (106,752) (l 06,752) Net change in fund balance 53,533 Fund balance - beginning 478,760 Fund balance - ending $532,293 137 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - ECONOMIC DEVELOPMENT AUTHORITY _ SECTION 8 HOUSING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31,2002 With Comparative Totals For the Year Ended December 31, 200 I Statement 40 2002 2001 Revenues: Intergovernmental revenue $15,531 $2,640 Investment income: Interest 716 Other 40 Total revenues 15,531 3,396 Expenditures: Personal services 986 Other services and charges 8,493 Total expenditures 0 9,479 Revenues over expenditures 15,53 I (6,083) Other financing sources (uses): Transfers in 85,877 Net change in fund balance 101,408. (6,083) Fund balance (deficit) - beginning (101,408) (95,325) Fund balance - ending $0 ($101,408) 138 NONMAJOR DEBT SERVICE FUNDS The City of Columbia Heights had the following Debt Service Funds during the year: Tax Increment Bond Funds - are separate funds used to account for each separate Tax Increment Bond Issue revenues and expenditures. These bonds are repaid primarily from tax increments. Special Assessment Improvement Bonds - are repaid primarily from special assessments. 139 140 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUB COMBINING BALANCE SHEET NONMAJOR DEBT SERVICE FUNDS December 31,2002 Statement 41 Tax Multi-Use G.O. Increment Redevelopment Improvement Bonds Plan 1999A Totals Assets Cash and investments $465,176 $ $697,819 $1,162,995 Receivables: Taxes: Unremitted 2,591 2,591 Delinquent 10,012 10,0 12 Interest 15,532 6,535 22,067 Interfund receivable 52,572 52,572 Total assets $545,883 $0 $704,354 $1,250,237 Liabilities and Fund Balance Liabilities: Due to other governmental units $ $7 $ $7 Interfund payable 52,572 52,572 Deferred revenue: Property taxes - delinquent 10,012 10,012 Total liabilities 10,012 52,579 0 62,591 Fund balance (deficit): Unreserved: Designated for debt service 535,871 704,354 1,240,225 Undesignated (52,579) (52,579) Total fund balance (deficit) 535,871 (52,579) 704,354 1,187,646 Total liabilities and fund balance $545,883 $0 $704,354 $1,250,237 141 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND NET ASSETS NONMAJOR DEBT SERVICE FUNDS For The Year Ended December 31, 2002 Tax Increment Bonds Revenues: Tax increments Intergovernmental Investment income: Interest and dividends Change in fair value Total revenues $610,109 84,509 73,296 18,013 785,927 Expenditures: Debt service: Principal retirement Interest and fiscal charges Miscellaneous Total expenditures Revenues over (under) expenditures Other financing sources (uses): Transfers in Transfers (out) Total other financing sources (uses) Net change in fund balance Fund balance (deficit) - beginning Fund balance (deficit) - ending 142 Capital Appreciation Bonds of1990 $ o Statement 42 Tax Increment Refunding Bonds of 1991 Multi-Use Redevelopment Plan G.O. Improvement 1999A Total $ $16,981 410 $ $627,090 84,919 17,391 30,839 7,579 38,418 104,135 25,592 841,736 o 220,000 105,000 716,515 6,380 30,370 530,985 12,311 30,237 226,380 12,311 135,370 1,277,737 (226,380) 5,080 (96,952) (436,00 I) 226,380 70,721 1,182,851 (1,112,130) 226,380 0 70,721 70,721 5,080 (26,231 ) (365,280) (57,659) 730,585 1,552,926 SO ($52,579) $704,354 $1,187,646 143 144 NONMAJOR CAPITAL PROJECT FUNDS The City of Columbia Heights had the following Capital Project Funds during the year: Capital Improvement Fund 401 - used to account for Capital Project Funds whereby funding is provided by a number of internal and external sources. Downtown Parking Maintenance Fund 405 - used for maintenance of the West Side Parking. Sheffield Redevelopment Fund 410 - used to fund redevelopment of the area of the City identified as Sheffield Neighborhood. Capital Improvement Parks Fund 412 - used to account for improvements in City parks. Capital Improvement PVVS Fund 414 - used to account for improvements to Parkview Villa South building. Capital Improvement Development Fund 420 - used to account for improvements to various development areas within the City. Infrastructure Replacement Fund 430 - used to fund replacement of City infrastructure. Capital Equipment Fire Fund 439 - used to fund replacement of fire capital assets. Capital Equipment Cable TV - used to fund replacement of cable capital assets. Capital Building: Library - used to fund replacement of the library building. TIF District #2 Fund 407 - used to account for revenues and expenditures located within the Tax Increment Financing District #2. TIF Medtronics Fund 378 - used to account for revenues and expenditures located within the Medtronics Tax Increment Financing District. TIF Scattered Site Fund 379 - used to account for revenues and expenditures located within the Scatter Site Tax Increment Financing District. TIF Transition Block Fund 389 - used to account for revenues and expenditures located within the Transition Block Tax Increment Financing District. 145 146 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR CAPITAL PROJECT FUNDS December 31, 2002 Statement 43 Page 1 of2 Capital Capital Downtown Sheffield Improvement Capital Parking Redevelopment Parks Improvement Maintenance Fund 410 Fund 412 Assets Cash and investments $530,036 $730,200 $483,133 S745,807 Rcceivables: Special assessments: Unremitted Interest 463 3,418 7,744 Due from other governmental units Interfund receivable Total assets $530,499 $733,618 $483,133 $753,551 Liabilities and Fund Balance Liabilities: Accounts payable $ $1,326 $ $ Contracts payable - retained percentage 1,000 Interfund payable Total liabilities 1,000 1,326 0 0 Fund balance (deficit): Unreserved: Designated for capital improvement 529,499 732,292 483,133 229,855 Undesignated 523,696 Total fund balance (deficit) 529,499 732,292 483,133 753,551 Total liabilities and fund balance $530,499 $733,618 $483,133 $753,551 147 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR CAP IT AL PROJECT FUNDS December 31, 2002 Capital Capital Capital Improvement Improvement Infrastructure Equipment PWS Development Replacement Fire Food 414 Fund 420 Fund 430 Fund 439 Assets Cash and investments $742,071 $888,253 S214,554 $656,402 Receivables: Special assessments: Unremitted Interest 7,862 393 5,325 7,076 Due from other governmental units 3,039 Interfund receivable 157,564 Total assets $749,933 $891,685 $377,443 $663,478 Liabilities and Fund Balance Liabilities: Accounts payable $ $8,916 $ $ Contracts payable - retained percentage Interfund payable Total liabilities 0 8,916 0 0 Fund balance (deficit); Unreserved: Designated for capital improvement 749,933 882,769 377,443 663,478 Undesignatcd Total fund balance (deficit) 749,933 882,769 377,443 663,478 Total liabilities and fund balance $749,933 $891,685 $377,443 $663,478 14.~ Statement 43 Page 2 of 2 Capital Capital Equipment Building TIF TIF TIF TIF Cable TV Library District #2 Medtronics Scattered Site Transition Block Fund 440 Fwd 450 Fund 407 Fund 378 Fund 379 FlU1d 389 Totals $300,000 $200,000 $ $210,452 $916 $9 $5,701,833 205 205 1,809 276 34,366 3,039 157,564 $300,000 $200,000 $0 $212,261 $1,397 $9 $5,897,007 $ s $ $52,129 $ $ 52,129 o $62,371 1,000 37,243 100,614 2,243 2,243 35,000 35,000 o o 300,000 200,000 160,132 160,132 (33,603 ) (33,603 ) 9 9 5,148,402 647,991 5,796,393 300,000 200,000 (2,243) (2,243 ) $300,000 $200,000 $0 $212,261 $1,397 $9 $5,897,007 149 150 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBlNING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR CAPn AL PROJECT FUNDS For The Year Ended December 31, 2002 Statement 44 Page 1 of2 Revenues: Tax increment Intergovernmental Investment income: Interest and dividends Change in fair value Other revenues: Miscellaneous Project reimbursement Total revenues Expendi tures: Developer incentives Contractual services Repair and maintenance Capital outlay Total expenditures Revenue over (under) expenditures Other financing sources (uses): Transfers in Transfers (out) Total other financing sources (uses) Net change in [und balance Fund balance (deficit) - beginning Fund balance (deficit) - ending Capital Improvement $ 2,187 537 ] ,6]3 4,337 4,170 4,170 167 2,932 2,932 3,099 526,400 $529,499 Downtown Parking Maintenance $ 16,]29 3,964 20,093 20,77] 20,77] (678) (678) 732,970 $732,292 151 Capital Sheffield Redevelopment Fund 410 $ 612,293 o 612,293 612,293 (129,160) $483,133 Capital Improvement Parks Fund 412 s 36,542 8,981 o 18,750 5,200 69,473 o 2,041 26,610 28,651 o 40,822 o 40,822 712,729 $753,551 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR CAPITAL PROJECT FUNDS For The Year Ended December 3],2002 Capital Capital Capital Improvement Improvement Infrastructure Equipment PVVS Development Replacement Fire Fund414 Fund 420 Fund 430 Fund 439 Revenues: Tax increment $ $ $ S Intergovernmental 3,039 Investment income: Interest and dividends 37,098 1,857 25,127 33,393 Change in fair value 9,]] 7 456 6,] 75 8,207 Other revenues: Miscellaneous Project reimbursement Total revenues 46,2]5 5,352 31,302 41,600 Expenditures: Developer incentives Contractual services 37,583 Repair and maintenance 1,839 Capital outlay 70,591 Total expenditures 0 37,583 0 72,430 Revenue over (under) expenditures 46,215 (32,23] ) 31,302 (30,830) Other financing sources (uses): Transfers in 915,000 Transfers (out) (144,380) Total other financing sources (uses) 0 9] 5,000 (]44,380) 0 Net change in fund balance 46,2]5 882,769 (I 13,078) (30,830) Fund balance (deficit) - beginning 703,718 490,521 694,308 Fund balance (deficit) - ending $749,933 $882,769 $377,443 $663,478 152 Statement 44 Page 2 of2 Capital Capital Equipment Building TIF TIF TIF TIF Cable TV Library District #2 Medtronic Scattered Site Transition Block Fund 440 Fund 450 Fund 407 Fund 378 Fund 379 Fund 389 Totals $ $ $ S116,269 S17,156 $9 S 133,434 3,896 6,935 8,537 1,306 162,176 2,098 321 39,856 18,750 6,813 0 0 0 126,904 22,679 9 367,964 104,258 104,258 419 62 38,064 28,821 97,201 0 0 0 104,677 62 0 268,344 0 0 0 22,227 22,617 9 99,620 300,000 200,000 2,030,225 (76, I 05) (220,485) 300,000 200,000 0 0 (76,105) 0 1,809,740 300,000 200,000 0 22,22 7 (53,488) 9 1,909,360 (2,243) 137,905 19,885 :1,887,033 $300,000 $200,000 ($2,243) $160,132 ($33,603 ) $9 $5,796,393 153 154 ENTERPRISE FUNDS The authority for these types of funds is derived from Section 69(b) of the City Charter which allows for Utility or other Public Service Enterprise Funds. The Enterprise Funds are members of the Proprietary Fund Type category, and, as such, are accounted for on the accrual basis of accounting. Revenues in the Enterprise Funds are recognized when they are earned and expenses are recognized when they are incurred. The Enterprise Funds are used to account for operations that are either financed and operated in a manner similar to private business enterprises or where the governing body has decided that periodic determination of revenues earned, expenses incurred, and/or net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes. Water Utility Fund - used to account for revenues and expenses associated with services to area residents. Sewer Utility Fund - used to account for revenues and expenses associated with sewer disposal within the City. Refuse Utility Fund - used to account for revenues and expenses associated with organized collection of refuse and recycling in the City. Storm Sewer Utility Fund - used to account for revenues and expenses associated with storm water disposal. Liquor Fund - used to account for revenues and expenses associated with the operation of three off-sale liquor stores. 155 CITY OF COLUMBIA HEIGHTS, MINNESOTA WATER UTILITY FUND Statement 45 SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2002 With Comparative Totals For December 31, 2001 Capital Equipment Capital Operating Replacement Construction Dcbt Totals Account Account Account Service 2002 2001 Assets Current assets: Cash and cash equivalents $39,923 $ - $ - S - $39,923 $322,790 Receivables: Accounts (net of allowance for uneo II eetabI es ) 283,783 283,783 285,538 Interest 1,457 3,189 2,022 6,668 11,656 Due from other governmental units 1,160 1,160 ]nterfund receivable 63,676 321,943 293,056 678,675 490,335 Inventory, at cost 2,864 2,864 4,708 T ota] current asscts 392,863 325,132 0 295,078 1,013,073 1,115,027 Noncurrent assets: Capital assets: Land 45,223 45,223 45,223 Buildings 447,305 447,305 462,288 Improvements othcr than buildings 5,550,711 5,550,711 5,381,373 Office furniture and fixtures 25,259 25,259 Machinery and equipment 206,972 206,972 330,376 Construction in process 21,377 Tota] capital assets 6,275,470 0 0 0 6,275,470 6,240,637 Less: accumulated depreciation (2,291,954) (2,291,954) (2,244,524) Tota] capital assets (net of accumulated depreciation) 3,983,516 0 0 0 3,983,516 3,996,113 Total noncurrent assets 3,983,516 0 0 0 3,983,516 3,996,]13 T atal assets 4,376,379 325,132 0 295,078 4,996,589 5,111,140 Liabilities Current ]iabilities: AceoW1ts payable 3,702 3,702 2,649 Accrued salaries and withholdings payable 3,044 3,044 14,253 Due to other governmental units 256,999 256,999 155,719 lnterfund payable 678,675 678,675 490,335 Accrued interest payable 14,420 14,420 15,741 Deposits 3,744 3,744 3,744 Compensated absences payable - current 385 385 Bonds payable - current 94,032 94,032 91,426 Total current liabilities 267,874 0 078,675 108,452 1,055,001 773,867 NoneWTent liablilities: Compensated absences payable-non current [2,791 12,791 Bonds payable - noncurrent 767,988 767,988 862,020 Total noncurrent liabilities 12,791 0 0 767,988 780,779 862,020 Total liabilities 280,665 0 678,675 876,440 1,835,780 1,635,887 Net Assets Invested in capital assets, net of related debt 3,983,516 (862,O20) 3,12l,496 3,134,093 Restricted for debt service 280,658 280,658 252,433 Unrestricted 112,198 325,132 (678,675) (241,345) 88,727 Total net assets $4,095,714 $325,132 ($678,675) ($581,362) $3,160,809 $3,475,253 156 CITY OF COLUMBIA HEIGHTS, MINNESOTA WATER UTILITY FUND Statement 46 SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 31, 200 I Capital Equipment Capital Operating Replacement Construction Debt Totals Account Account Account Service 2002 2001 Operating revenues: Charges for services: Customer services $32,117 :1; - $ - $ - $32,117 $25,913 Penalties 32,774 32,774 31,118 Charges for sales: Water ] ,252,015 1,252,015 1,311,179 Meter 6,432 68,274 74,706 80,273 Total operating revenues 1,323,338 0 0 68,274 1,391,612 1,448,483 Operating expenses: Cost of sales and services 910,316 910,316 983,112 Distribution 47l,116 471,116 424,114 Administration 8,426 8,426 7,779 Depreciation 161,970 161,970 163,622 Total operating expenses ],551,828 0 0 0 1,551,828 1,578,627 Net income from operations (228,490) 0 0 68,274 (160,216 ) (130,144) Nonoperating revenues (expenses): Investment income: Interest and dividends 6,877 15,047 9,543 3 1 ,467 51,701 Change in fair value 1,690 3,698 2,345 7,733 3,880 Miscellaneous revenues 57 57 31 Interest and fiscal charges (35,152) (35,152J (38,203) Miseellaneous expenses (1,987) Total nonoperating revenues (expenses) 8,624 18,745 0 (23,264) 4,105 15,422 Net income (loss) before transfers (219,866) 18,745 0 45,010 (156,111) (114,722) Transfers in 209,717 25,000 74,641 309,358 1,765,241 Transfers out (219,007) (209,717) (428,724 ) (1,881,925 ) Total transfers (9,290) 25,000 (209,717) 74,641 (119,366) (116,684) Change in net assets (229,156) 43,745 (209,717) 119,651 (275,477) (231,406) Total net assets - beginning, as previously stated 4,363,837 281,387 (468,958) (701,013) 3,475,253 3,706,659 Change in accounting principle (38,967) (38,967) Total net assets - beginning, as restated 4,324,870 281,387 (468,958) (701,013) 3,436,286 3,706,659 T otaI net assets - ending $4,095,714 $325,132 ($678,675) ($581,362) $3,160,809 $3,4 7 5,253 157 CITY OF COLUMBIA HEIGHTS, MINNESOTA WATER UTILITY FUND SUBCOMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31, 2002 With Comparative Totals For The Year Ended December 31,2001 Statement 47 2002 2001 SI,203,867 $1,068,813 (847,327) (818,775) (248,047) (242,235) 57 31 (l,987) 108,550 5,847 309,358 1,765,241 (428,724) (1,881,925) (119,366) (116,684) (209,717) (285,600) 21,376 (91,426) (57,468) (36,473 ) (39,057) (316,240) (382,125) Cash flows from operating activities: Cash received from customers Cash paid to suppliers for goods and services Cash payments to employees for services Miscellaneous revenues Miscellaneous expenses Net eash flows from operating activities Cash flows from noncapitaI financing activities: Transfers in Transfers out Net cash flows from noncapital financing activities Cash flows from capital and related financing activities: Acquisition of capital assets Disposition of capital assets Principal payments - bonds Interest and fiscal charges Net cash flows from capital and related financing activities Cash flows from investing activities: Investment income: Interest and dividends Changc in fair value Net cash flows from investing activities Net increase (decrease) in cash and cash equivalents 36,456 49,333 7,733 3,880 44,189 53,213 (282,867) (439,749) 322,790 762,539 $39,923 $322,790 Cash and cash equivalents - January I Cash and cash equivalents - December 31 Reconciliation of operating income to net cash flows from operating activities Operating income (loss) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Miscellaneous revenues Miscellaneous expenses Depreciation expense Changes in assets and liabilities: (lncrease) decrease in accounts receivable (Increase) decrease in interfund receivables (lncrcase) decrease in due from other govcrnmental units (lncrcase) decrease in inventory, at cost Increase (decrease) in accounts payable [ncrcase (decrease) in accrued salaries and withholdings payable Increase (decrease) in contracts payable-retained percentage Increase (decrease) in due to other governmental units Increase (decrease) in interfund payablcs Increase (decrease) in compensated absences payable Total adjustments ($160,216 ) ($130,144) 57 31 (l,987) 161,970 163,622 1,755 9,060 (188,340) (388,730) (1,160) ],844 1,728 1,053 ( 1,413) (11,209) (8,850) (131,341) 10 I ,280 104,660 188,340 389,211 13,176 268,766 135,991 $108,550 $5,847 Net cash flows from operating activities 158 CITY OF COLUMBIA HEIGHTS, MINNESOTA SEWER UTILITY FUND SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2002 With Comparative Totals For December 31,2001 Statement 48 Capital Equipment Capital Operating Replacement Construction Debt Totals Account Account Account Service 2002 2001 Assets Current assets: Cash and cash equivalents $1,294,614 $427,008 $953,572 S4,711 $2,679,905 $2,588,726 Receivables: Accounts (net of allowance for uncollectables) 263,948 263,948 272,205 Interest 13,266 4,271 11,852 29,389 29,099 Due from other governmental units 7,999 Interfund receivables 96,404 527,000 623 ,404 551,563 Total current assets 1,668,232 431,279 1,492,424 4,711 3,596,646 3,449,592 Noncurrent assets: Due from other governmental units 200,083 200,083 220,962 Capital Assets: Land 36,586 36,586 36,586 Buildings 45,20 I 45,201 57,942 Improvements other than buildings 4,153,263 4,153,263 3,976,079 Office furniture and fixtures 40,964 40,964 Machinery and equipment 418,383 418,383 570,097 Construction in process 5 5 1,456 Tota] capital assets 4,694,397 0 5 0 4,694,402 4,642,160 Less: accumulated depreciation (2,678,294) (2,678,294) (2,672,143) Total capital assets (net of aecummulated depreciation) 2,016,103 0 5 0 2,016,108 ],970,017 Total noncurrent assets 2,216,186 0 5 0 2,216,191 2,190,979 T ota] assets 3,884,418 431,279 1,492,429 4,711 5,812,837 5,640,571 Liabilities Current liabilities: Accounts payable 4,763 4,763 778 Accrued salaries and withholdings payable 2,734 2,734 13,214 Accrued interest payable 547 547 597 Compensated absences payable - current 385 385 Bonds payable - current 3,568 3,568 3,469 Total current liabilities 7,882 0 0 4,1 15 11,997 18,058 Noncurrent liabilities: Compensated absences payable - noncurrent ]2,791 12,79] Bonds payable - noncurrent 29,136 29,]36 32,704 Total noncurrent liabilities 12,791 0 0 29,136 41,927 32,704 Total liabilities 20,673 0 0 33,251 53,924 50,762 Net Assets Invested in capital assets, net ofrclated debt 2,016,103 (32,704 ) 1,983,399 1,937,3]3 Restricted for debt service 4,164 4,164 3,964 Unrestricted [,847,642 431,279 1,492,429 3,771,350 3,648,532 Total net assets $3,863,745 $431,279 $1,492,429 ($28,540 ) $5,758,913 $5,589,809 159 CITY OF COLUMBIA HEIGHTS, MINNESOTA SEWER UTILITY FUND SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS For The Year Ended December 31, 2002 With Comparative Totals For The Year Ended December 31, 2001 Statement 49 Capital Equipment Capital Operating Replacement Construction Debt Totals Account Account Account Service 2002 2001 $1,204,112 $ - $ - $ - SI,204,112 $1,215,330 669,354 669,354 660,588 271,038 271,038 27 I ,009 10,288 10,288 11,479 130,073 130,073 132,444 1,080,753 0 0 0 1,080,753 1,075,520 123,359 0 0 0 123,359 139,810 Operating revenues: Charges for sales and services: Sewer service charges Operating expenses: Cost of sales and services Distribution Administration Depreciation Total operating expenses Net income from operations Nonoperating revenues (expenses) Investment income: Interest and dividends Change in fair value Intergovernmental Miscellaneous revenues Interest and fiscal charges Miscellaneous expenses Total nonoperating revenues (expenses) 62,600 20,156 55,930 2 138,688 131,525 15,385 4,953 13,745 34,083 9,686 198 198 3,327 16,824 16,824 38,041 (1,333 ) (1,333 ) (1,450 ) (9,132) 95,007 25, I 09 69,675 (1,33 I) 188,460 171,997 218,366 25,109 69,675 (1,331) 311,819 311,807 220,965 25,000 5,000 250,965 352,074 (149,364 ) (210,965) (360,329) (199,090) 71,601 25,000 (210,965) 5,000 (109,364) 152,984 289,967 50,109 (14 1,290) 3,669 202,455 464,791 3,607,129 381 , 1 70 1,633,719 (32,209) 5,589,809 5,125,018 (33,351 ) (33,351 ) 3,573,778 381 ,170 1,633,719 (32,209) 5,556,458 5,125,018 $3,863,745 $431,279 $1,492,429 ($28,540) $5,758,913 $5,589,809 Net income (loss) before transfers Transfers in Transfers out Total transfers Change in nct assets Total net assets - beginning, as previously stated Change in accounting principle Total net assets - beginning, as restated Total nct assets - ending 160 CITY OF COLUMBIA HEIGHTS, MINNESOTA SEWER UTILITY FUND SUBCOMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 31,2001 Statement 50 2002 2001 SI,169,406 SI,278,835 (785,058) (779,478) (158,940) (172,319) 17,022 41,368 (9,132) 242,430 359,274 250,965 352,074 (360,329) (199,090) (109,364) 152,984 (209,516) (58,054) 204,117 (3,469 ) (2,180) (l ,383 ) (1,482) (214,368) 142,401 Cash flows from operating activities: Cash received from customers Cash paid to suppliers for goods and services Cash payments to employees for services Miscellaneous revenues Miscellaneous expenses Net cash flows from operating activities Cash flows from noncapital financing activities: Transfers in Transfers out Net cash flows from noncapital financing activities Cash flows from capital and related financing activities: Acquisition of capital assets Disposition of capital assets Principal payments - bonds Interest and fiscal charges Net cash flows from capital and related financing activities Cash flows from investing activities: Investment income: Interest and dividends Change in fair value Net cash flows from investing activities 138,398 119,614 34,083 9,686 172,481 129,300 91,179 783,959 2,588,726 1,804,767 $2,679,905 $2,588,726 Net increase in eash and cash equivalents Cash and cash equivalents - January 1 Cash and cash equivalents - December ::I] Reconciliation of operating income to net cash flows from operating activities Operating income Adjustments to reconcile operating income to net cash flows from operating activities: Miscellaneous revenues Miscellaneous expenses Depreciation expense Changes in assets and liabilities: (Increase) decrease in accounts receivable (Increase) decrease in due from other governmental units (Increase) decrease in interfund receivables Increase (decrease) in aCCOlll1ts payable Incrcase (decrease) in accrued salaries and withholdings payable Increase (decrease) compensated absences payable Total adjustments $123,359 $139,810 17,022 41,368 (9,132) 130,073 132,444 8,257 8,686 28,878 17,079 (71,841) 37,740 3,986 (l ,633) (10,480) (7,088 ) 13,176 119,071 219,464 $242,430 $359,274 Net cash flows from operating activities 161 CITY OF COLUMBIA HEIGHTS, MINNESOTA REFUSE UTILITY FUND SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2002 With Comparative Totals For December 31, 2001 Statement 51 2002 2001 Assets Current assets: Cash and cash equivalents Receivables: Accounts (net of allowance for uncollectables) Interest Due from other govemmentaltmits Total current assets $605,231 $610,125 280,375 6,772 20,382 912,760 283,646 9,762 17,762 921,295 Noncurrent assets: Capital assets: Buildings Improvements other than buildings Machinery and equipment Total capital assets Less: accumulated depreciation Total capital assets (net of accumulated depreciation) Total noncurrent assets 6,000 6,000 11 ,566 14,456 97,124 107,681 114,690 128,137 (40,961) ( 41 ,71 7) 73,729 86,420 73,729 86,420 986,489 1,007,715 Total assets Liabilities CUlTent liabilities: Accounts payable Total liabilities 208,101 102,194 208,101 1 02, I 94 73,729 86,420 704,659 819,101 $ 778,388 $905,521 Net assets Invested in capital assets, net of related debt Unrestricted Total net assets 1 f\'J CITY OF COLUMBIA HEIGHTS, MINNESOTA REFUSE UTILITY FUND SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 31,2001 Statement 52 2002 2001 Operating revenues: Refuse service charges $1,247,692 $1,237,355 Operating expenses: Cost of sales and services 1,251,827 1,229,432 Administration 12,964 11,391 Recycling 12,712 16,115 Hazardous waste 1,959 2,670 Depreciation 11,169 12,238 Total operating expenses 1,290,631 1,271,846 Net income (loss) from operations (42,939) (34,491) Nonoperating revenues (expenses): Investment income: Interest and dividends 31,956 43,300 Change in fair value 7,854 3,250 Intergovernmental 53,780 54,963 Miscellaneous revenues 1,290 1,843 Total nonoperating revenues (expenses) 94,880 103,356 Net income before transfers 51,941 68,865 Transfers out (177,552) ( 166,960) Change in net assets (125,611) (98,095) Total net assets - beginning, as previously stated 905,521 1,003,616 Change in accounting principle ( I ,522) Total net assets - beginning, as restated 903,999 1,003,616 Total net assets - ending $778,388 $905,521 163 CITY OF COLUMBIA HEIGHTS, MINNESOTA REFUSE UTILITY FUND SUBCOMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 31,200 I Statement 53 2002 2001 Cash flows from operating activities: Cash received from customers Cash paid to suppliers for goods and services Cash payments to employees for services Miscellaneous revenues Net cash flows from operating activities $1,248,343 (1,172,974) (581 ) 55,070 129,858 $1,222,836 (1,257,581) (627) 56,806 21,434 Cash flows from noncapital financing activities: Transfers out (l77,552) (166,960) Cash flows from investing activities: Investment income: Interest and dividends Change in fair value Net cash flows from investing activities 34,946 43,003 7,854 3,250 42,800 46,253 (4,894 ) (99,273) 610,125 709,398 $605,231 $610,125 Net increase (decrease) in cash and cash equivalents Cash and cash equivalents - January I Cash and cash equivalents - December 3 ] Reconciliation of operating income to net cash flows from operating activities Operating income (loss) ($42,939) ($34,491 ) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Miscellaneous revenues Depreciation expense Changes in assets and liabilities: (Increase) decrease in accounts receivable (Increase) decrease in due from other governmental units Increase (decrease) in accounts payable Total adjustments 55,070 56,806 11,169 12,238 3,271 3,243 (2,620) (17,762) 105,907 1,400 172,797 55,925 $129,858 $21,434 Net cash flows from operating activities 164 CITY OF COLUMBIA HEIGHTS, MINNESOTA STORM SEWER UTILITY FUND Statement 54 SUBCOMBINING SCHEDULE OF NET ASSETS December 31,2002 With Comparative Totals For December 31,2001 Capi tal Equipment Capital Operating Replacement Construction Debt Totals Account Account Account Service 2002 2001 Assets Current assets: Cash and cash equivalents $5,754 $12,255 $89,667 S - $107,676 $85,683 Receivables: Accounts (net of allowance for uncollectables) 36,237 36,237 36,217 In terest 263 97 1,315 1,675 6,541 Due from other governmentallll1its 14,955 14,955 Total eurrent assets 42,254 12,352 105,937 0 160,543 128,441 Noncurrent assets: Capital assets: Land 254,724 254,724 Improvements other than buildings 774,028 774,028 675,867 Construction in process 37,901 37,901 270,917 Total capital assets 1,028,752 0 37,901 0 1,066,653 946,784 Less: accumulated depreciation (53,360) (53,360) (19,664) Total capital assets (net of accummulated depreciation) 975,392 0 37,901 0 1,013,293 927,120 Total nonCUITent assets 975,392 0 37,901 0 1,013,293 927,120 Total assets 1,017,646 12,352 143,838 0 1,173,836 1,055,561 Liabilities Current liabilities: Accounts payable 169 169 1,325 Accrued salaries and withholdings payable 69 69 12 Interfund payable 96,404 96,404 30,843 Accrued interest payable 12,635 12,635 13,792 Bonds payable - CUITent 82,400 82,400 80, 105 Total ClUTent liabilities 238 0 0 191,439 191,677 126,077 Noncurrent liabilities: Bonds payable - noncurrent 672,876 672,876 755,276 Total liabilities 238 0 0 864,315 864,553 881,353 Net Assets Invested in capital assets, net of related debt 975,392 (755,276) 220,116 171,844 Restricted for debt service (l09,039) (109,039) ( 44,635) Unrestricted 42,016 12,352 143,838 198,206 46,999 Total net assets $1,017,408 $12,352 $143,838 ($864,315) $309,283 $174,208 165 CITY OF COLUMBIA HEIGHTS, MINNESOTA STORM SEWER UTILITY FUND Statement 55 SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS For The Year Ended December 31, 2002 With Comparative Totals For The Year Ended December 31, 2001 Capital Equipment Capital Operating Replacement Construction Debt Totals Account Account Account Service 2002 2001 Operating revenues: Charges for sales and services: Storm sewer service charges $172,975 $ - $ - $ - $172,975 $172,654 Operating expenses: Distribution 97,672 97,672 73,139 Administration 1,233 1,233 Depreciation 33,988 33,988 13,989 Total operating expenses 132,893 0 0 0 132,893 87,128 Net income from operations 40,082 0 0 0 40,082 85,526 Nonoperating revenues (expenses): Investment income: Interest and dividends 1,239 455 6,205 7,899 29,009 Change in tair value 304 112 1,525 1,941 2,178 In tergovemmen tal 130,339 130,339 Interest and fiscal charges (30,799) (30,799) (33,473) Total nonoperating revenues (expenses) 1,543 567 138,069 (30,799) 109,380 (2,286) Net income (loss) before transfers 41,625 567 138,069 (30,799) 149,462 83,240 Transfers in 362,210 5,800 32,900 46,500 447,4] 0 5 ] 7,291 Transfers out (95,200) (362,210) (457,410) (51 7,291 ) Total transfers 267,010 5,800 (329,310) 46,500 ( 10,000) 0 Change in net assets 308,635 6,367 (191 ,241 ) 15,701 139,462 83,240 Total net assets - beginning, as previously stated 713,160 5,985 335,079 (880,016) 174,208 90,968 Change in accounting principle (4,387) ( 4,387) Total net assets - beginning, as restated 708,773 5,985 335,079 (880,016) 169,821 90,968 Total net assets - ending $1,017,408 $12,352 $143,838 ($864,315) $309,283 $174,208 166 CITY OF COLUMBIA HEIGHTS, MINNESOTA STORM SEWER UTILITY FUND SUBCOMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 31,2001 Statement 56 Cash flows from operating activities: Cash received from customers Cash paid to suppliers for goods and services Cash payments to employees for services Net cash flows from operating activities 2002 2001 $158,000 S 175,935 20,009 2,313 (54,452) (51,533) 123,557 126,715 447,41 0 51 7,291 (457,410) (517,291) (10,000) 0 ( 124,548) (572,622) (80,105) (50,352) 130,339 (31,956) (34,220) (l06,270) (657,194) Cash flows from noncapital financing activities: Transfers in Transfers out Net cash flows from noncapital financing activities Cash flows from capital and related financing activities: Acquisition of capital assets Principal payments - bonds Proceeds of capital grants and contributions Interest and fiscal charges Net cash flows from capital and related financing activities Cash flows from investing activities: Investment income: Interest and dividends Change in fair value Net cash flows from investing activities 12,765 32,006 1,941 2,178 14,706 34,184 21,993 (496,295) 85,683 581,978 $107,676 $85,683 Net increase in cash and cash equivalents Cash and cash equivalents- January 1 Cash and cash equivalents - December 31 Reconciliation of operating income to net cash flows from operating activities Operating income $40,082 $85,526 Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation expense Changes in assets and liabilities: (Increase) decrease in accounts receivable (Increase) decrease in due from other governmental units Increase (decrease) in accounts payable Increase (decrease) in accrued salaries and withholdings payable Increase (decrease) in interfund payable Total adjustments 33,988 13,989 (20) 3,281 (14,955) (1,156) (6,936) 57 12 65,561 30,843 83,4 75 41,189 $123,557 $126,715 Net cash flows from operating activities 167 CITY OF COLUMBIA HEIGHTS, MINNESOTA LIQUOR FUND SUBCOMBINING SCHEDULE OF NET ASSETS December 31,2002 With Comparative Totals For December 31,2001 Statement 57 Capital Equipment Operating Replacement Totals Account Account 2002 2001 Assets ClUTent assets: Cash and cash equivalents $1,956,292 $26,839 $1,983,131 $1,575,193 Receivables: Interest 18,834 276 19, II 0 21,236 Due from other governmental units 2,024 2,024 1,612 Interfund receivables 169,000 Inventory, at cost 1,188,663 1,188,663 902,315 Total current assets 3, I 65,813 27,115 3,192,928 2,669,356 Noncurrent assets: Capital assets: Land 4,360 4,360 4,360 Buildings 162,239 162,239 181,631 Improvements other than buildings 81,198 81,198 103,409 Office furniture and fixtures 14,791 14,791 Machinery and equipment 289,381 289,381 370,187 Total capital assets 551,969 0 551,969 659,587 Less: accumulated depreciation (484,486) (484,486) (568,613 ) Net capital assets (net of accumulated depreciation) 67,483 0 67,483 90,974 Total noncurrent assets 67,483 0 67,483 90,974 Total assets 3,233,296 27,1 15 3,260,411 2,760,330 Liabilities Current liabilities: Accounts payable 234,286 234,286 127,578 Accrued salalies and withholdings payable 10,617 10,617 40,630 Due to other governmental units 58,612 58,612 67,787 Compensated absences payable - current 883 883 Total current liabilities 304,398 0 304,398 235,995 Noncurrent liabilities: Compensated absences payable - noncurrent 29,352 29,352 Total liabilities 333,750 0 333,750 235,995 Net Assets Invested in capital assets, net of related debt. 67,483 67,483 90,974 Unrestricted 2,832,063 27,115 2,859,178 2,433,361 Total net assets $2,899,546 $27,115 $2,926,661 $2,524,335 1 ()R CITY OF COLUMBIA HEIGHTS, MINNESOTA LIQUOR FUND SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 31,2001 Statement 58 Capital Operating Accounts Total Equipment Top Heights Operating Replacement Totals Top Valu Valu II Liquor Accounts Account 2002 2001 Operating revenues: Charges for sales: Liquor $975,992 $672,080 $456,694 $2,104,766 $ - $2,104,766 $2,023,135 Beer 1,490,330 1,215,554 810,063 3,515,947 3,515,947 3,504,000 Wine 322,695 297,150 66, 1 99 686,044 686,044 645,396 Other 245,553 166,468 138,529 550,550 550,550 623,853 Total operating revenues 3,034,570 2,351,252 1,471,485 6,857)07 0 6,857,307 6,796,384 Operating expenses: Cost of goods sold 2,336,230 1,810,383 1,107,985 5,254,598 5,254,598 5,267,398 Operating expense 537,723 369,309 186,349 1,093,381 1,093,381 1,048,677 Depreciation 1,375 10,202 1,352 12,929 12,929 20,732 Total operating expenses 2,875,328 2,189,894 1,295,686 6,360,908 0 6,360,908 6,336,807 Net income from operations $159,242 $161,358 $175,799 496,399 0 496,399 459,577 Nonoperating revenues (expenses): Investment income: Interest and dividends 88,875 1,305 90,180 94,196 Change in fair value 21,842 321 22,163 7,069 Miscellaneous revenues 26,037 26,037 8,014 Miscellaneous expenses (3,939) (3,939) (10,000) Total nonoperating revenues (expenses) 132,815 1,626 134,441 99,279 Net income before transfers 629,214 1,626 630,840 558,856 Transfer out (217,954) (217,954) (213,000) Change in net assets 411,260 1,626 412,886 345,856 Total net assets - beginning, as previously stated 2,498,846 25.489 2,524,335 2,178,479 Change in accounting principle (10,560) (10,560) Total net assets - beginning, as restated 2,488,286 25,489 2,513,775 2,178,4 79 Total net assets - ending $2,899,546 $27,115 $2,926,661 $2,524,335 169 CITY OF COLUMBIA HEIGHTS, .MINNESOTA LIQUOR FUND SUB COMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31, 2002 With Comparative Totals For The Year Ended December 3 1,2001 Statement 59 Cash flows from operating activities: Cash received from customers Cash paid to suppliers for goods and services Cash payments to employees for services Miscellaneous revenues Miscellaneous expenses Net cash flows from operating activities 2002 2001 $7,025,895 $6,802,303 (5,865,191) (5,981,613) (671,379) (641,038) 26,037 8,014 (3,939) (10,000) 511 ,423 1 77,666 (217,954) (213,000) (217,954) (213,000) Cash flows from noncapital financing activities: Transfers out Net cash flows from noncapital financing activities Cash flows from investing activities: Investment income: Interest and dividends Change in fair value Net cash flows from investing activities 92,306 87,885 22,163 7,069 114,469 94,954 407,938 59,620 I ,575,193 1,515,573 $1,983,13 I $1,575,193 Net increase in cash and cash equivalents Cash and cash equivalents - January I Cash and cash equivalents - December 31 Reconciliation of operating income to net cash tlows from operating activities Operating income $496,399 $459,577 Adjustments to reconcile operating income to net cash flows from operating activities: Miscellaneous revenues Miscellaneous expenses Depreciation expense Changes in assets and liabilities: (Increase) decrease in accounts receivable (Increase) decrease in due from other governmental units (Increase) decrease in interfund receivables (Increase) decrease in prepayments (Increase) decrease in inventory, at cost Increase (decrease) in accounts payable Increase (decrease) in accrued salaries and withholdings payable Increase (decrease) in due to other governmental units Increase (decrease) in compensated absences payable Total adjustments Net cash flows from operating activities 170 INTERNAL SERVICE FUNDS Internal Service Funds are used to account for the financing on a cost reimbursement basis of goods or services provided by one department or agency to other departments or agencies within the City. Central Garage Fund - used to account for the costs of operating a maintenance facility for automotive equipment used by other City departments. Such costs are billed to other departments at actual cost plus a fixed overhead factor. The automotive equipment itself is acquired by the various user departments which are responsible for financing replacement vehicles as necessary. Energv Management Fund - used to account for the costs associated with energy management and maintenance within the City. All costs are recorded in the fund and allocated to user departments. Insurance Fund - used to account for certain costs of the City's risk management services and to build a reserve for catastrophic losses. All costs for claims and claims administration are recorded in the fund and allocated to user funds based on a percentage risk factor. Insurance premiums are recorded directly in the user funds. Compensated Absences Fund - used to account for funds that have been set aside by the City Council for compensated absences. 171 CITY OF COLUMBIA HEIGHTS, MINNESOTA INTERNAL SERVICE FUNDS COMBINING SCHEDULE OF NET ASSETS December 31, 2002 With Comparative Totals For December 31,2001 Statement 60 Central Data Compensated Totals Garage Processing Insurance Absences 2002 2001 Assets Current assets: Cash and cash equivalents $98,327 $509,043 $567,543 $564,153 $1,739,066 $1,682,345 Receivables: Accounts (net of allowance for uncolIectables) 2,453 2,453 2,631 Interest 232 282 5,425 5,939 22,508 Prepayments 12,477 12,477 84,276 Inventory, ot cost 66,359 66,359 56,110 Total current assets 167,371 509,325 585,445 564,153 1,826,294 1,847,870 Noncurrent assets: Capital assets: Buildings 371,383 371,383 800,859 Improvements other than buildings 119,847 119,847 439,128 Machinery and equipment 77 ,044 26,139 103,183 278,453 Total capital assets 568,274 26,139 0 0 594,413 1,518,440 Less: accumulated depreciation (408,455) (l8,737) (427,192) (1,248,760) Total capital assets (net of accumulated depreciation) 159,819 7,402 0 0 167,221 269,680 Total noncurrent assets 159,819 7,402 0 0 167,221 269,680 Totalossct~ 327,190 516,727 585,445 564,153 1,993,515 2,117,550 Liabilities Current liabilities: Accounts payable 10,296 13,734 24,030 22,355 Accrued salaries and withholdings payable 1,394 1,922 3,316 2,373 Compensated absenccs payable - currcnt 724 153 877 Total current liabilities 12,414 15,809 0 0 28,223 24,728 Noncurrent liabilites: Compensated absences payable - noncurrent 24,071 5,074 547,495 576,640 538,466 Total noncurrent liabilities 24,07] 5,074 0 547,495 576,640 538,466 Total liabilities 36,485 20,883 0 547,495 604,863 563,194 Net Assets Invested in capital assets, net of related debt 159,819 7,402 167,221 269,680 Unrestricted 130,886 488,442 585,445 16,658 1,221,431 1,284,676 Total net assets $290,705 $495,844 $585,445 $16,658 $1,388,652 $1,554,356 171. CITY OF COLUMBIA HEIGHTS, MINNESOTA INTERNAL SERVICE FUNDS Statement 61 COMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 31,2001 Central Energy Data Compensated Totals Garage Management Processing Insurance Absences 2002 2001 Operating revenues: Charges tor services: Services to departments $143,133 $ - $ - S - $ - $143,133 $114,082 Use of space 184,762 184,762 163,573 Insurance allocation 478,373 478,373 363,641 Recovery of damages 14,029 14,029 52,830 Charges for sales: Sales of gasoline 57,543 57,543 66,508 Total operating revenues 385,438 0 0 492,402 0 877,840 760,634 Operating expenses: Cost of services and space 311,400 189,211 418,531 919,142 896,531 Claims administration 837 837 5,476 Claims 32,165 32,165 328,716 Depreciation 37,511 8,713 46,224 65,003 Total operating expenses 348,911 0 197,924 451,533 0 998,368 1,295,726 Net income (loss) from operations 36,527 0 (197,924) 40,869 0 (120,528) (535,092) Nonoperating revenues: Investment income: Interest and dividends 1,097 1,333 25,602 28,032 99,835 Change in fairvaluc 269 327 6,292 6,888 7,493 Miscellancous revenues 3,022 3,022 3,177 Total nonoperating revenues 4,388 0 1,660 31,894 0 37,942 110,505 Net income (loss) before transfers 40,915 0 ( 196,264) 72,763 0 (82,586) (424,587) Transfers in 4,000 310,000 314,000 319,000 Transfers out ( 94,500) (107,646 ) (138,737) (340,883) (94,000) Total transfers ( 90,500) (107,646) 310,000 0 (138,737) (26,883) 225,000 Change in net assets (49,585) (107,646) 113,736 72,763 (138,737) ( I 09,469) ( 199,587) Total net assets - beginning, as previously stated 360,005 107,646 418,628 512,682 155,395 1,554,356 1,753,943 Change in accounting principle (19,715) (36,520) (56,235) Total net assets - beginning, as restated 340,290 107,646 382,108 512,682 ] 55,395 1,498,121 1,753,943 Total net assets -ending $290,705 $0 $495,844 $585,445 $16,658 $ 1,388,652 $1,554,356 173 CITY OF COLUMBIA HEIGHTS, MINNESOTA INTERNAL SERVICE FUNDS COlvtBINING STATEMENT OF CASH FLOWS For The Year Ended December 31,2002 With Comparative Totals For Tlle Year Ended December 31, 2001 Statement 62 Central Energy Dal:::! Compensated Totals Garage Management Processing Insurance Absences 2002 2001 Cash flows from operating activities: Cash received from interfimd services provided 5385,616 5 - S S492,402 537,552 S915,570 5797,543 Cash paid to suppliers for goods and services (182,767) (47,970) (379,734) (610,471 ) (1,037,710) Cash payments to employees for services (142,590) (133,416) (276.006) (274,883) Miscellaneous revenues 3,022 3.022 5,798 Net cash flows from operating activities 63,281 0 ( 181.386) 112,668 37.552 32.115 (509,252) Cash flows from noncapital financing activities: Transfers in 4.000 310,000 314,000 319,000 Transfers out (94,500) (107,646) (138,737) (340.883) (94,000) Net cash flows from lloncapital financing activities (90,500) (107,646) 310,000 0 (138,737) (26,883 ) 225,000 Cash flows from capital and related fmancing activities: Acquisition of fIxed assets (36,236) Net cash flows rrom capital and related financing activities 0 0 0 0 0 0 (36,236) Cash flows from investing activities: Investment income: Interest and dividends 2,674 1,350 5,197 27,75'/1. 7,622 44,601 97,978 Change in fair value 269 327 6,292 6,888 7,493 Net cash flows from investing activities 2,943 1,350 5,524 34,050 7,622 51,489 105,471 Net increase (decrease) in cash and cash equivalents (24,276) (106,296 ) 134,138 146,7Hi (93,563 ) 56,721 (215,OI7) Cash and cash equivalents - January 1 122,603 106,296 374,905 420,825 657,716 1,682,345 1,897,362 Cash and cash equivalents - December 3 1 $98,327 $0 5509.043 $567,543 5564,153 $1,739,066 $ I .682,345 Reconciliation of operating income (loss) to net cash flows from operating activities Operating income (loss) $36,527 $ ($197,924) $40,869 S ($120,528) ($535,092) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Miscellaneous revenues 3,022 3,022 3,177 Depreciation expense 37.511 8.713 46,224 65,003 Changes in assets and liabilities: (Increase) decrease in accounts receivable 178 178 3,646 (Increase) decrease in prepayments 71,799 7],799 7,464 (Increase) decrease in inventory, at cost (10,249) ( 10,249) (8,13 6) Increase (decrease) in accounts payable (5,580) 7,255 1,675 (25,328) Increase (decrease) in claims payable (61,495) Increase (decrease) in accmed salaries and withholdings payable (435) 579 37,552 37,696 41,509 Increase (decrease) in compensated absences payable 2,307 (9) 2,298 Total adjustments 26,754 0 16,538 71,799 37,552 l52,643 25,840 Net cash tlows from operating acti vities S63,281 SO ($181,386) S112,66X S37,552 $32,115 (S509,252) 174 CITY OF COLUMBIA HEIGHTS, MINNESOTA CENTRAL GARAGE FUND SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2002 With Comparative Totals For December 31,2001 Statement 63 Capital Equipment Operating Replacement Totals Account Account 2002 2001 Assets Current assets: Cash and cash equivalents $73,776 $24,551 $98,327 $ I 22,603 Receivables: Accounts (net of allowance for uncollcctables) 2,453 2,453 2,631 Interest 232 232 1,809 Inventory, at cost 66,359 66,359 56,110 Total current assets 142,588 24,783 167,371 183,153 Noncurrent assets: Capital assets: Buildings 371,383 371 ,383 404,988 Improvements other than buildings 119,847 119,847 124,218 Machinery and equipment 77 ,044 77,044 120,177 Total capital assets 568,274 0 568,274 649,383 Less: accwnulated depreciation (408,455) (408,455) (432,338) Total capital assets (net of accwnulated depreciation 159,819 0 159,819 2 I 7,045 Total noncurrent assets 159,819 0 159,819 217,045 Total assets 302,407 24,783 327,190 400,198 Liabilities Current liabilities: Accounts payable 10,296 10,296 15,876 Accrued salaries and withholdings payable 1,394 1,394 1,829 Compensated absences payable - current 724 724 Total current liabilities 12,414 0 12,414 17,705 Noncurrent Iiabilites: Compensated absences payable - noncurrent 24,071 24,071 22,488 Total noncurrent liabilities 24,071 0 24,071 22,488 Total liabilities 36,485 0 36,485 40,193 Net Assets Invested in capital assets, net of related debt 159,819 159,819 2 I 7,045 Unrestricted 106,103 24,783 130,886 142,960 Total net assets $265,922 $24,783 $290,705 $360,005 175 CITY OF COLUMBIA HEIGHTS, MINNESOTA CENTRAL GARAGE FUND SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For The Year Ended December 31, 2002 With Comparative Totals For The Year Ended December 31,2001 Statement 64 Operating revenues: Charges for services: Services to departments Use of space Charges for sales: Sales of gasoline Total operating revenues Capital Equipment Operating Replacement Totals Account Account 2002 2001 $143,133 $ - $143,133 $114,082 184,762 184,762 163,573 57,543 57,543 66,508 385,438 0 385,438 344,163 311,400 311,400 328,722 37,5 11 37,511 42,951 348,911 0 348,911 371,673 36,527 0 36,527 (27,510) Operating expenses: Cost of services and space Depreciation Total operating expenses Net income (loss) from operations Nonoperating revenues: Investment income: Interest and dividends Change in fair value Miscellaneous revenues Total nonoperating revenues 1,097 1,097 8,022 269 269 602 3,022 3,022 3,177 3,022 1,366 4,388 11,80 I 39,549 1,366 40,91 5 (15,709) 4,000 4,000 19,000 (94,500) (94,500) (94,000) (94,500) 4,000 (90,500) (75,000) (54,951) 5,366 (49,585) (90,709) 340,588 i 9,417 360,005 450,714 (19,715) (19,715) 320,873 19,4 17 340,290 450,714 $265,922 $24,783 $290,705 $360,005 Net income (loss) before transfers Transfers in Transfers out Total transfers Change in net assets Total net assets - beginning, as previously stated Change in accounting principle Total net assets - beginning, as restated Total net assets - ending 176 CITY OF COLUMBIA HEIGHTS, MINNESOTA CENTRAL GARAGE FUND SUBCOMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 31,2001 Statement 65 2002 2001 Cash flows from operating activities: Cash received from interfund services provided Cash paid to suppliers for goods and services Cash payments to employees for services Miscellaneous revenues Net cash flows from operating activities $385,616 (182,767) (142,590) 3,022 63,281 $345,188 ( 182,940) (147,866) 3.177 17,559 Cash flows from noncapital financing activities: Transfers in Transfers out Net cash flows from noncapital financing activities 4,000 (94,500) (90,500) 19,000 (94,000) (75,000) Cash flows from capital and related financing activities: Acquisition of fixed assets Net cash flows from capital and related financing activities (2,668) (2,668) o Cash flows from investing activities: Investment income: Interest and dividends Change in fair value Net cash flows from investing activities 2,674 8,376 269 602 2,943 8,978 (24,276) (51,131) 122,603 173,734 $98,327 $122,603 Net increase (decrease) in cash and cash equivalents Cash and cash equivalents - January 1 Cash and cash equivalents - December 31 Reconciliation of operating income (loss) to net cash flows from operating activities Operating income (loss) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Miscellaneous revenues Depreciation expense Changes in assets and liabilities: (Increase) decrease in accounts receivable (Increase) decrease in inventory, at cost Increase (decrease) in accounts payable Increase (decrease) in accrued salaries and withholdings payable Increase (decrease) in compensated absences payable Total adjustments Net cash flows from operating activities $36,527 ($27,510) 3,022 3,177 37,511 42,95] 178 1,025 (10,249) (8,136) (5,580) 2,668 (435) 3,384 2,307 26,754 45,069 $63,281 S 17,559 177 CITY OF COLUMBIA HEIGHTS, MINNESOTA ENERGY MANAGEMENT FUND SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2002 With Comparative Totals For December 31,2001 Statement 66 2002 2001 Assets Current assets: Cash and cash equivalents $ - $106,296 Receivables: Interest 1,350 Total CWTent assets 0 107,646 Noncurrent assets: Capital assets: Buildings 395,871 Improvements other than buildings 314,910 Total capital assets 0 710,781 Less: accumulated depreciation (710,781) Total capital assets (net of 0 0 accumulated depreciation) Total assets 0 107,646 Liabi lities Current liabilities: Total liabilities 0 0 Net Assets Unrestricted 107,646 Total net assets $0 $107,646 17R CITY OF COLUMBIA HEIGHTS, l\iIINNESOT A ENERGY MANAGEMENT FUND SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 31,2001 Statement 67 2002 2001 Operating revenues: $ - $ - Operating expenses: Net income from operations o o Nonoperating revenues: Investment income: Interest and dividends Change in fair value Total nonoperating revenues 5,988 449 0 6,437 0 6,437 (107,646) (107,646 ) 6,437 107,646 101,209 $0 $107,646 Net income before operating transfers Operating transfers: Transfer out Change in net assets Total net assets - beginning Total net assets - ending 179 CITY OF COLUMBIA HEIGHTS, MINNESOTA ENERGY MANAGEMENT FUND SUBCOMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 3 I, 2002 With Comparative Totals For The Year Ended December 31,2001 Statement 68 2002 2001 Cash flows from operating activities: Miscellaneous revenues Net cash flows from operating activities s o $2,621 2,621 Cash flows from noncapital financing activities: Transfers out (107,646) Cash flows from investing activities: Investment income: Interest and dividends Change in fair value Net cash flows from investing activities 1,350 5,134 449 1,350 5,583 (106,296) 8,204 106,296 98,092 $0 $106,296 Net increase (decrease) in cash and cash equivalents Cash and cash equivalents - January 1 Cash and cash equivalents - December 31 Reconciliation of operating income to net cash flows from operating activities Operating income $ $ Adjustments to reconcile operating income to net cash flows from operating activities: Miscellaneous revenues Total adjustments o 2,621 2,621 Net cash flows from operating activities so $2,621 180 CITY OF COLUMBIA HEIGHTS, MINNESOTA DATA PROCESSING FUND SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2002 With Comparative Totals For December 31,2001 Statement 69 Capital Equipment Operating Replacement Totals Account Account 2002 2001 Assets Current assets: Cash and cash equivalents $481,634 $27,409 $509,043 $374,905 Interest receivable 282 282 4,146 Total current assets 481,634 27,691 509,325 379,051 Noncurrent assets: Capital assets: Machinery and equipment 26,139 26,139 158,276 Total capital assets 26,139 0 26,139 158,276 Less: accumulated depreciation (18,737) (18,737) (105,64 I) Net capital assets (net of accumulated depreciation) 7,402 0 7,402 52,635 Total noncurrent assets 7,402 0 7,402 52,635 Total assets 489,036 27,691 516,727 431,686 Liabilities Current liabilities: Accounts payable 13,734 ]3,734 6,479 Accrued salaries and withholdings payable 1,922 1,922 1,343 Compensated absences payable - current 153 153 Total liabilities 15,809 0 15,809 7,822 Noncurrent liabilites: Compensated absences payable - noncurrent 5,074 5,074 5,236 Total noncurrent liabilities 5,074 0 5,074 5,236 Total liabilities 20,883 0 20,883 13,058 Net Assets Invested in capital assets, net of related debt 7,402 7,402 52,635 U nrestri cted 460,751 27,691 488,442 365,993 Total net assets $468,153 $27,691 $495,844 $418,628 181 CITY OF COLUMBIA HEIGHTS, MINNESOTA DATA PROCESSING FUND SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 3 I, 200 I Statement 70 Capital Equipment Operating Replacement Totals Account Account 2002 2001 $ - S - $ - $ - 189,211 189,211 172,471 8,713 8,713 22,052 197,924 0 197,924 194,523 (197,924) 0 (197,924) (194,523) Operating revenues: Operating expenses: Cost of services Depreciation Total operating expenses Net income (loss) from operations Nonoperating revenues: Investment income: Interest and dividends Change in fair value Total nonoperating revenues o 1,333 327 1,660 1,333 18,391 327 1,380 1,660 19,771 (196,264) (174,752) 310,000 300,000 113,736 125,248 418,628 293,380 (36,520) 382,108 293,380 $495,844 $418,628 Net income (loss) before transfers (197,924) 1,660 Transfers in 310,000 Change in net assets 112,076 1,660 Total net assets - beginning, as previously stated Change in accounting principle Total net assets - beginning, as restated 392,597 (36,520) 356,077 26,031 26,031 Total net assets - ending $468,153 $27,691 182 CITY OF COLUMBIA HEIGHTS, MINNESOTA DATA PROCESSING FUND SUBCOMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 31,2001 Statement 71 2002 2001 Cash flows from operating activities: Cash paid to suppliers for goods and services Cash payments to employees for services -Net cash flows from operating activities ($47,970) (133,416) (181,386) ($71,199) (127,017) (198,216) Cash flows from noncapital financing activities: Transfers in Net cash flows from noncapital financing activities 310,000 310,000 300,000 300,000 Cash flows from capital and related financing activities: Acquisition of fixed assets Net cash flows from capital and related financing activities (33,568) (33,568) o Cash flows from investing activities: Investment income: Interest and dividends Change in fair value Net cash flows from investing activities 5,197 16,489 327 1,380 5,524 1 7,869 134,138 86,085 374,905 288,820 $509,043 $374,905 Net increase in cash and cash equivalents Cash and cash equivalents - January 1 Cash and cash equivalents - December 31 Reconciliation of operating income (loss) to net cash flows from operating activities Operating income (loss) ($ [97,924) ($194,523) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation expense Changes in assets and liabilities: Increase (decrease) in accounts payable Increase (decrease) in accrued salaries and withholdings payable Increase (decrease) in compensated absences payable Total adjustments 8,713 22,052 7,255 (27,986) 579 2,241 (9) 16,538 (3,693) ($181,386) ($198,216) Net cash flows from operating activities 183 CITY OF COLUMBIA HEIGHTS, MINNESOTA INSURANCE FUND SUBCOMBINING SCHEDULE OF NET ASSETS December 31,2002 With Comparative Totals For December 31, 2001 Statement 72 2002 2001 Assets Current assets: Cash and cash equivalents $567,543 $420,825 Receivables: Interest 5,425 7,581 Prepayments 12,477 84,276 Total assets 585,445 512,682 Liabilities Current liabilities: Total liabilities 0 0 Net Assets Unrestricted 585,445 512,682 Total TIet assets $585,445 $512,682 184 CITY OF COLUMBIA HEIGHTS, MINNESOTA INSURANCE FUND S UBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For The Year Ended December 31, 2002 With Comparative Totals For The Year Ended December 31,2001 Statement 73 2002 2001 Operating revenues: Insurance allocation $478,373 $363,641 Recovery of damages 14,029 52,830 Total operating revenues 492,402 416,471 Operating expenses: Insurance premiums 418,531 395,338 Claims administration 837 5,476 Claims 32,165 328,716 Total operating expenses 451,533 729,530 Net income from operations 40,869 (313,059) Nonoperating revenues: Investment income: Interest and dividends 25,602 33,626 Change in fair value 6,292 2,524 Total nonoperating revenues 31,894 36,150 Change in net assets 72,763 (276,909) Net assets - beginning 512,682 789,591 Net assets - ending $585,445 $512,682 185 CITY OF COLUMBIA HEIGHTS, MINNESOTA INSURANCE FUND SUBCOMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 31,2001 Statement 74 2002 2001 Cash flows from operating activities: Cash received from damages $492,402 $416,471 Cash paid to suppliers for goods and services (379,734) (783,571) Net cash flows from operating activities 112,668 (367,100) Cash flows from investing activities: Investment income: Interest and dividends 27,758 35,800 Change in fair value 6,292 2,524 Net cash flows from investing activities 34,050 38,324 Net increase (decrease) in cash and cash equivalents 146,718 (328,776) Cash and cash equivalents - January 1 420,825 749,601 Cash and cash equivalents - December 31 $567,543 $420,825 Reconciliation of operating income (loss) to net cash flows from operating activities Operating income (loss) $40,869 ($313,059) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Changes in assets and liabilities: (Increase) decrease in prepayments 71,799 7,464 Increase (decrease) in accounts payable (10) Increase (decrease) in claims payable (61,495) Total adjustments 71 ,799 (54,041 ) Net cash flows from operating activities $112,668 ($367,100) 186 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMPENSATED ABSENCES FUND SUBCOMBINING SCHEDULE OF NET ASSETS December 31,2002 With Comparative Totals For December 31,2001 Statement 75 2002 2001 Assets Current assets: Cash and cash equivalents $564,153 $657,716 Interest receivable 7,622 Total assets 564,153 665,338 Liabilities Noncurrent liabilities: Compensated absences payable 547,495 509,943 Total liabilities 547,495 509,943 Net Assets Unrestricted 16,658 155,395 Total net assets S16,658 S155,395 187 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMPENSATED ABSENCES FUND SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For The Year Ended December 31, 2002 With Comparative Totals For The Year Ended December 31,2001 Statement 76 2002 2001 Operating revenues: Charges for services $ - $ - Operating expenses: Cost of services Net income from operations o o Nonoperating revenues: Investment income: Interest and dividends Change in fair value Total nonoperating revenues 33,808 2,538 0 36,346 0 36,346 (138,737) (138,737) 36,346 155,395 119,049 $]6,658 $155,395 Net income before transfers Transfers out Change in net assets Total net assets - beginning Total net assets - ending 188 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMPENSATED ABSENCES FUND SUB COMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31,2002 With Comparative Totals For The Year Ended December 31, 200 I Statement 77 2002 2001 Cash flows from operating activities: Cash received from interfund services provided $37,552 $35,884 Cash flows from investing activities: Investment income: Interest and dividends Change in fair value Net cash flows from investing activities 7,622 32,179 2,538 7,622 34,717 (138,737) (138,737) 0 (93,563 ) 70,601 657,716 587,115 $564,153 $657,716 Cash flows from noncapital financing activities: Transfers out Net cash flows from noncapital financing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents - January I Cash and cash equivalents - December 3] Reconciliation of operating income to net cash flows from operating activities Operating income $ $ Adj ustments to reconcile operating income to net cash flows from operating activities: Changes in assets and liabilities: Increase (decrease) in accrued salaries and withholdings payable Total adjustments 37,552 37,552 35,884 35,884 Net cash flows from operating activities $37,552 $35,884 189 190 TRUST AND AGENCY FUNDS Trust and Agency Funds are used to account for assets held by a government in a trustee or agent capacity for individuals, private organizations, other governments and the like. The City of Columbia Heights had the following Trust and Agency Funds during the year: Agency Funds: Permit Surcharge Fund - used to account for SAC charges and surcharges collected for and remitted to the State of Minnesota. Escrow Agency Fund - used to account fOf payroll-related assets and liabilities. 191 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMBINING STATEMENT OF FIDUCIARY NET ASSETS December 31,2002 Statement 78 Permit Surcharge Escrow Agency Agency Assets Fund Fund Totals Cash and investments $8,971 $27 ,883 $36,854 Total assets 8,971 27 ,883 36,854 Liabilities Liabilities: Accounts payable 2 I, I 36 2 1,136 Due to other governmental units 8,971 806 9,777 Deposits 4,350 4,350 Other liabilities 1,591 I ,591 Total liabilities $8,971 $27,883 $36,854 192 CAPITAL ASSETS USED IN THE OPERATION OF GOVERNMENTAL FUNDS 193 C\ t- ... C c:.I S c:.I ... t':l ... en ,.-.. ........ 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Increment Bonds Capital Appreciation Bonds of 1990: Refunding Bonds of 1991: All bonds maturing on or after March 1, 2000 shall be subject to redemption and prior payment in whole or in part at the option of the issuer on March 1, 1999 and on any day thereafter at a price of par and accrued interest. G O. Improvement Bonds Series 1999A: Bonds due on or after February I, 2008 are callable commencing February I, 2007 and on any date thereafter at a price of par plus accrued interest. Total Bonds - General Long Term Debt Account Group PROPRIETARY FUNDS G 0 Utility Revenlle Bonds Series 1999B: Bonds due on or after February 1,2008 are callable commencing February I, 2007 and on any date thereafter at a price of par plus accrued interest. Total Bonds - Proprietary Funds Total General Obligation Bonds 198 Interest Rate 9/01 6.90% 6.95% 7.00% 7.00% 7.10% 7.10% 7.15% 7.15% 3/01 - 9/01 5.30% 5.50% 5.60% 5.70% 5.80% 2/01-8/01 3.45% 3.55% 3.65% 3.80% 3.90% 4.00% 4.10% 4.15% 4.25% 4.30% 2/01-8/0 I 3.45% 3.55% 3.65% 3.80% 3.90% 4.00% 4.10% 4.15% 4.25% 4.30% Issue Date 8/23190 1211/91 5fl/99 511/99 Maturity Date 9/1/09 311102 2/l/1 0 21111 0 Exhibit 1 Original Issue $2,399,72] 6,670,000 860,000 9,929,721 ] ,935,000 1,935,000 $11,864,72] Balance 1Il/02 $2,399,721 220,000 810,000 3,429,721 1,825,000 1,825,000 $5,254,721 Sold $ - $0 Retired $391,515 220,000 105,000 o 7] 6,515 175,000 o 175,000 $891,515 199 Balance 12/31/02 $2,008,206 705,000 2,713,206 1,650,000 1,650,000 $4,363,206 Interest Paid in Current Year $493,485 6,380 30,054 529,9 I 9 69,496 69,496 $599,415 200 III. S TAT 1ST I C A L SEe T ION (U N A U D I TED) 201 .... IF) Q) (") :c N~ c;:l t- ~ '0 'D Eo-< E-< ......... N N €A ~ IF) t- r-: (") """ (")~ 'D €A 0'\ 0'\ E :-. 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C ::l o U c;i ~ o c: <C ll.l U ~ o CIJ CITY OF COLUMBIA HEIGHTS, MINNESOTA CITY TAX LEVY Years 1993 Through 2002 (Unaudited) Table 8 Fiscal City Levy General Year Total Fund Library EDA Special PERA 1993 $3,463,645 $3,084,666 $378,979 $ $ 1994 3,548,960 3,158,342 390,348 1995 3,587,209 3,196.861 390,348 1996 2,754,161 2,340,393 413,768 1997 3,038,144 2,517,101 422,043 99,000 1998 3,201,434 2,659,289 443,145 99,000 1999 3,238,625 2,660,059 467,518 111,048 2000 3,295,956 2,676,416 500,244 119,296 2001 3,625,552 2,958,490 547,767 119,295 2002 4,824, l30 4,083,494 591,588 137,015 12,033 Source: Certification of Truth in Taxation document filed with Anoka County by the City of Columbia Heights, 209 CITY OF COLUMBIA HEIGHTS, MINNESOTA PRINCIPAL TAXPAYERS December 31, 2002 (Unaudited) Table 9 %of Total City Tax Capacity Tax Capacity Taxpayer Type of Business Value Value Medtronics, Inc. Medical Manufacturing $174,502 1.67% Bradley Operating LP Commercial 141,728 1.36% Consolidated Reality of Minneapolis Apartments 98,923 0.95% Maylan Construction Company Retail (K-mart) 86,848 0.83% Columbia Heights Center Mall 80,930 0.78% Columbia Park Properties Medical Building 76,552 0.73% Lake State Properties Commercial 76,278 0.73% Crestview Lutheran Home Apartments 65,187 0.62% Lynde Investment Co Apartments 57,466 0.55% Jeffs Bobby & Steves Auto World Commercial 49,366 0.47% Northern States Power Utility 49,072 0.47% Total Principal Taxpayers $956,852 9.17% Source: Anoka County: Taxes & Taxable Property in the City of Columbia Heights 210 U'J Z o ...... ~E-< ~u o~ r;"J-J r.:1-J ZO ZU ~Cl :;;Z c.-5 <r:: E-tU'J ::r:~ ~> ~~ ~~ ~Z ~~ ~~ ;::lU'J ~~ aU'J U~ ~-J O<r:: >c...... E-t~ CJ?7J o ..... 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E rd 1-0 bJ) c: :g a 0.. ~ E=: ~ CITY OF COLUMBIA HEIGHTS, MINNESOTA COMPUTATION OF LEGAL DEBT MARGIN December 31, 2002 (Unaudited) Table 11 Debt Limit Percentage (Note A) Statutory Debt limit Amount of Debt applicable to debt limit: Total bonded debt 2001/2002 2000/200 I $775,336,500 $719,348,700 2% 2% 15,506,730 14,386,974 4,363,206 5,254,721 2,008,206 2,619,721 2,355,000 2,635,000 $13,151,730 $11,751,974 Market Value Less: (Note B) Tax increment bonds Special assessment bonds Total amount of debt applicable to debt limit Legal debt margin Note A M.S.A. Section 475.53 (Limit on Debt) Subdivision 1. Generally, except as otherwise provided in Sections 475.51 to 475.75, "no municipality, except a school district or a city of the first class, shall incur or be subject to a net debt in excess of 2% of the taxable market value." Note B M.S.A. Section 475.51 (definitions) Subdivision 4. TlNet debt" means the amount remaining after deducting from its gross debt the amount of current revenues which are applicable within the current fiscal year to the payment of any debt and the aggregate of the principal of the following: 1. Obligations issued for improvements which are payable wholly or partly from the proceeds of special assessments levied upon property specially benefited thereby, including those which are general obligations of the municipality issuing them, if the municipality is entitled to reimbursement in whole or in part from the proceeds of the special assessments. 2. Warrants or orders having no definite or fixed maturity. 3. Obligations payable wholly from the income from revenue producing conveniences. 4. Obligations issued to create or maintain a Permanent Improvement Revolving Fund. 5. Obligations issued for the acquisition and betterment of public water works systems and public lighting, heating or power systems, and of any combination thereof or for any other public convenience from which a revenue is or may be derived. 6. Not applicable. 7. Amount of all money and face value of all securities held as a Debt Service Fund for the extinguishment of obligations other than those deductible under this subdivision. 8. All other obligations which under the provisions of law authorizing their issuance are not to be included in computing the net debt of the municipality. 212 '"d N (\) ;.... .-I '"d OJ B ~ 0... \0 CI.l 0 ....... 0 0 0 eo r- \I") Z o:l .0 rr; a- lii IJj a- 'i" r:<I IJj a- r- cj \I") C':l OJ U V7 'i" 'i" r:<I C"1 C"1 rr; C"1 .---< .-< to- G) Cl Z <J:: t-< ...... 0... <J:: U 0:: r.Ll 0... E-< o:l r.Ll Q Q i:IJ Q Z o t:Q Z ~g J:.I.lt-< 0<J:: 09 <J:.I.l.....:! 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U~i:IJ.....J("1j8 ~oz<r:O\~ Ooi:IJE-<~;c:l ............00(/);::l E:E-<IY:E-<a~ l-I<eooOJ~ U~~E-<>--'C o a o t.r) r-- 00 o o o t.r) ...... q o a o. t.r) 'q a o ~ t.r) t.r) ...... o q \fl \fl ...... o Cl Cl ci 0\ 0\ o o q IF) -q- 0\ o o o ci o 0\ o o o ci N q t.r) t.r) c:a 0\ 00 :~ 0:: -< iOA cd @ ~ OJ ii:>--' ('<j 0\ 0\ -q- 0\ 0\ t.r) 0\ 0\ ...... \0 0\ 0\ r-- 0\ 0\ .- 00 0\ 0\ 0\ 0\ 0\ o ~ N ...... o N N o o ('4 214 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMPUTATION OF DIRECT AND OVERLAPPING DEBT December 31, 2002 (Unaudited) Table 14 Amount Applicable to Net Percentage City of General Applicable Columbia Heights Obligation Debt to City Share of Debt Direct debt: City of Columbia Heights $4,363,206 100.0% $4,363,206 Overlapping debt: Anoka County 93,445,000 5.06% 4,725,142 Metropolitan Council 221,700,0~0 5.06% II ,21 0,488 ISD 13 (Columbia Heights) 31,140,000 69.76% 21,723,921 Total overlapping debt 346,285,000 37,659,551 Totals $350,648,206 $42,022,757 Source: Anoka County Auditor Certificate 215 It'l 0 rrl 0 1.0 l""'I c: ~ ~ 00 Cl) Q.) 8 0 ('fj ("I ::0 .--< c:l c;j Eo-< ~ Q.) >- 0 U 8 r-- ,...... 1.0 &"7 0\ 0 0\ ."""" 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E-< > ..... c;j Q.) ..c: ....-..- ....-..- ....-..- uJ VJ c "0 E-< ,-< ('.1 ~ - c;j ~ '-' '-' u ez::: ......l '-' z 216 CITY OF COLUMBIA HEIGHTS, MINNESOTA PROPERTY VALUE AND CONSTRUCTION Years 1993 Through 2002 (Unaudited) Table 16 Property Value (A) Construction Fiscal Number Year Real Personal Total of Units Value 1993 $9,503,314 $207,255 $9,710,569 505 $3,292,353 1994 9,226,574 207,309 9,433,883 565 4,522,438 1995 9,021,129 207,658 9,228,787 596 4,927,970 1996 8,884,233 220,961 9,105,194 602 11,910,040 1997 9,185,608 224,356 9,409,964 678 5,904,308 1998 8,840,736 193,445 9,034,181 869 16,991,747 1999 8,557,027 168,578 8,725,605 1,254 24,018,811 2000 9,219,621 161,709 9,381,330 794 6,767,183 2001 10,304,905 157,970 10,462,875 671 12,547,885 2002 8,756,307 91 ,466 8,847,773 625 8,283,941 (A) Tax capacity (1993-2002) values from Table 6. 217 CITY OF COLUMBIA HEIGHTS, MINNESOTA MISCELLANEOUS STATISTICS December 31, 2002 (Unaudited) Table 17 Page 1 of 2 Date of Incorporation March 14, 1898 Date of Adoption of City Charter July 21, 1921 Form of Government Fiscal Year Begins Area of City Council-Manager January I 3.52 Square Miles Miles of Streets and Alleys: Trunk Highways County City Streets Alleys 3.0 6.2 61.8 18.9 Miles of Sewers: Storm Sewers Sanitary Sewers 33.6 59.0 Watermain Miles 66.1 Building Permits Iss ued: 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Estimated Construction Cost for Issued Pemlits: 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 505 565 596 602 678 869 1,254 794 671 625 3,292,353 4,522,438 4,927 ,970 11,910,040 5,904,308 16,991,747 24,018,811 6,767,183 12,547,885 8,283,941 218 CITY OF COLUMBIA HEIGHTS, MINNESOTA MISCELLANEOUS STATISTICS December 31, 2002 CD naudited) Table 17 Page 2 of 2 Fire Protection: Number of Stations Number of Employees: Full-time Part -time Volunteer 8 I 25 Police Protection: Number of Stations Number of Employees I 36 Parks: City Parks Playgrounds County Park 13 11 1 Schools: Senior High Junior High Elementary Parochial Elementary 1 I 3 1 Employees (as of December 31, 2002): Regular Part-time and Temporary 112 III 223 Elections: Registered voters - Last City General Election (11/05/02) Number of Votes Cast - Last City General Election Percentage of Registered Voters Voting 10,261 8,405 81.91 % Population: 1900 1920 1930 1940 1950 1960 1970 1975 (Mid-Decade Census) 1980 1985 1990 (Census) 2000 (Census) 123 2,968 5,613 6,053 8,175 17,533 23,997 23,3 16 20,029 19,540 18,910 18,520 219 CITY OF COLUMBIA HEIGHTS, l.\1INNESOTA DEMOGRAPHIC STATISTICS (Unaudited) Table 18 POPULATION, HOUSEHOLDS, AND HOUSEHOLD SIZE PROJECTIONS 2000 * 8,039 230 18,520 Households Household Size (People/Household) Population POPULA TION DEMOGRAPHICS Number of Persons by Age: *** 4 and under 5-9 10~14 15-19 20 - 24 25 - 34 35 - 44 45 - 54 55 - 59 60 - 64 65 - 74 75 - 84 85 and over Total population Total female population Total male population Persons 995 1,097 1,105 1,078 1,170 2,663 2,897 2,340 878 842 1,670 1,325 460 18,520 9,629 8,891 OCCUPATION INFORMATION Management, professional, and related occupations Service occupations Sales and office occupations Farming, fishing and forestry occupations Construction, maintenance, transportation and manufacturing occupations INCOME INFORMATION Median income per capita Median income per household Median income per family $21,368 $40,562 $50,610 * Source: 2000 Census Source: US Census Bureau, Profile of Occupation, Industry and Class of Worker: 2000 Source: US Census Bureau, Profile of General Demographic Characteristics: 2000 Source: US Census Bureau, Income and Poverty Status in 1999: 2000 ** *** **** 220 Percent 5.37 % 5.92 5.97 5.82 6.32 14.38 15.64 12.63 4.74 4.55 9.02 7.15 2.48 100.00 51.99 48.01 28.00 % 16.10 31.30 0.20 24.40 IV. SIN G LEA U D I TAN DOT HER REQUIRED REPORTS 221 222 Tautges Redpath, Ltd. Certified Public Accountants and Consultants Independent Auditor's Report on Compliance With Minnesota Legal Compliance Audit Guide for Local Governments To The Honorable Mayor and Members of the City Council Columbia Heights, Minnesota We have audited the basic financial statements of the City of Columbia Heights, Milmesota, as of and for the year ended December 31, 2002, and have issued our report thereon dated April 9, 2003. We conducted our audit in accordance with auditing standards generally accepted in the United States of Anlerica, and the provisions of the Minnesota Legal Compliance Audit Guidefor Local Government promulgated by the Legal Compliance Task Force pursuant to Milmesota 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 Columbia Heights, Minnesota complied with the material tenns and conditions of applicable legal provisions. This report is intended solely for the information and use of the City Council, management and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than those specified parties. April 9, 2003 1/t-4 ~ ~H,I t/2 HLB TAUTGES REDPATH, LTD. Celtified Public Accountants White Bear Lake Office: 4810 White Bear Parkway, White Bear Lake, MN 55110, USA Telephone: 6514267000 Fax: 6514265004 Hastings Office: 1303 South Frontage Road, Suite 13, Hastings, MN 55033, USA Telephone: 651 4804990 Fax: 651 4265004 HLB Tautges Redpath, Ltd. is a member of .International. A world-wide organization of accounting firms and business advisors. 223 224 Tautges Redpath, Ltd. Certified Public Accountants and Consultants Independent Auditor's Report on Compliance and on Internal Control over Financial Reporting Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards To the Honorable Mayor and Members of the City Council Columbia Heights, Minnesota We have audited the basic financial statements of the City of Columbia Heights, Minnesota as of and for the year ended December 31, 2002, and have issued our report thereon, dated April 9, 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 of the United States. Compliance As part of obtaining reasonable assurance about whether the City of Columbia Heights, Minnesota's basic financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of basic 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 performing our audit, we considered the City of Columbia Heights, Minnesota '8 internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the basic financial statements and not to provide assurance on the internal control over financial reporting. However, we noted certain matters involving the internal control over financial reporting and its operation that we consider to be reportable conditions. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control over financial reporting that, in our judgment, could adversely affect the City of Columbia Heights, Minnesota's ability to record, process, summarize, and report White Bear Lake Office: 4810 White Bear Parkway, White Bear lake, MN 55110, USA Telephone: 651 4267000 Fax: 651 4265004 Hastings Office: 1303 South Frontage Road, Suite 13, Hastings, MN 55033, USA Telephone: 6514804990 Fax: 651 4265004 HLB Tautges Redpath, Ltd. is a member of III International. A world-wide organization of accounting firms and business advisors. 225 226 financial data consistent with the assertions of management in the basic financial statements. Reportable conditions are described in the accompanying schedule of findings and questioned costs as item 2002-1 and 2002-2. 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 basic financial statements being audited may occur and not be detected within a timely period by employees in the nom1a1 course of performing their assigned functions. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the intelnal control that might be reportable conditions and, accordingly, would not necessarily disclose all repOliable conditions that are also considered to be material weaknesses. However, we believe that none of the reportable conditions described above is not a material weakness. We also noted other matters involving the internal control over financial reporting, which we have reported to management of the City ofCohm1bia Heights, Minnesota in a separate letter dated April 9, 2003. This report is intended solely for the information and use of the City Council, management and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than those specified parties. April 9, 2003 !lt4 ~ ~, tli HLB TAUTGES REDPATH, LTD. Celiitied Public Accountants 227 228 Tautges Redpath, Ltd. Certified Public Accountants and Consultants Independent Auditor's Report on Compliance with Requirements Applicable to each Maior Program and Internal Control over Compliance in Accordance with OMB Circular A-I33 To the Honorable Mayor and Members of the City Council Columbia Heights, Minnesota Compliance We have audited the compliance of the City of Columbia Heights, Minnesota with the types of compliance requirements described in the U.S. 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 of Columbia Heights, Minnesota's major federal programs are identified in the summary of auditor's 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 of the City of Columbia Heights, Minnesota's management. Our responsibility is to express an opinion on the City of Columbia Heights, 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 of the 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 of Columbia Heights, Minnesota's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for OUf opinion. OUf audit does not provide a legal determination on the City of Columbia Heights, Minnesota's compliance with those requiremen ts. White Bear Lake Office: 4810 White Bear Parkway, White Bear Lake, MN 55110, USA Telephone: 6514267000 Fax: 651 4265004 Hastings Office: 1303 South Frontage Road, Suite 13, Hastings, MN 55033, USA Telephone: 651 4804990 Fax: 651 4265004 HLB Tautges Redpath, Ltd. is a member or!l!!lnternational. A world-wide organization of accounting firms and business advisors. 229 230 In our opinion, the City of Columbia Heights, 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. Internal Control Over Compliance The management of the City of Columbia Heights, 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 of Columbia Heights, Minnesota'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 OMB Circular A-133. We noted certain matters involving the internal control over compliance and its operation that we consider to be reportable conditions. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control over compliance that, in our judgment, could adversely affect the City of Columbia Heights, Minnesota's ability to administer a major federal program in accordance with applicable requirements of laws, regulations, contracts and grants. Reportable conditions are described in the accompanying Schedule of Findings and Questioned Costs as items described in item 2002-3. Our consideration of the internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. 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 maj or 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. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses. We also noted other matters involving the internal controls and its operation that we have reported to the management of the City of Columbia Heights, Minnesota, and the Columbia Heights Economic Development Authority, in separate reports dated April 9, 2003. 231 232 Schedule of Expenditures of Federal Awards We have audited the basic financial statements of the City of Columbia Heights, Minnesota as of and for the year ended December 31, 2002, and have issued our report thereon dated April 9, 2003, except for the Schedule of Federal Expenditures which is dated August 26, 2003. Our audit was performed for the purpose offonning an opinion on the basic financial statements taken as a whole. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by OMB Circular A-I33 and is not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole. This report is intended solely for the information and use of the City Council, management and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than those specified parties. April 9, 2003, (except lor the Schedule of Federal Expenditures which is dated August 26, 2003) 1M~~,aa: HLB TAUTGES REDPATH, LTD. Certified Public Accountants 233 234 CITY OF COLUMBIA HEIGHTS, MINNESOTA SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ended December 31, 2002 SECTION I - SUMMARY OF AUDIT RESULTS 1. The Independent Auditor's Report expresses an unqualified opinion on the basic financial statements of the City of Columbia Heights, Minnesota. 2. There were two reportable conditions disclosed during the audit of the financial statements as reported in the Independent Auditor's Report on Compliance and on Internal Control over Financial Reporting Based on an Audit of Financial Statements Performed in accordance with Government Auditinf! Standards. The above conditions were not determined to be material weaknesses. 3. No instances of noncompliance material to the financial statements of the City of Columbia Heights, Minnesota were disclosed during the audit. 4. One reportable condition relating to the audit of the major federal award programs is reported in the Independent Auditor's Report on Compliance with Requirements Applicable to each Major Program and Internal Control over Compliance in Accordance with OMB Circular A-133. The above condition was not determined to be a material weakness. 5. The auditor's report on compliance for the major federal award programs for the City of Columbia Heights, Minnesota expresses an unqualified opinion. 6. Audit findings, if any, relative to the major federal award programs for the City of Columbia Heights, Minnesota are reported in Section III of this Schedule. 7. The Capital Funds Program - CFDA #14.872 was tested as a major program. 8. The threshold for distinguishing Types A and B programs was $300,000. 9. The City of Columbia Heights, Minnesota was determined to be a low-risk auditee for 2002. 235 236 CITY OF COLUMBIA HEIGHTS, MINNESOTA SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ended December 31, 2002 SECTION II - FINANCIAL STATEMENT FINDINGS 2002 - 1: Recreational Revenue Documentation Condition: Certain documentation needs to be maintained in the City's files to substantiate that proper procedures have been followed when recording recreational revenue. Cunently, documentation is not maintained that provides for verifYing the completeness of recreation revenue. We noted the City does not maintain an audit trail regarding recreational revenue. Also, checks received by the Recreation Depmiment are endorsed at the end of the day rather than upon receipt. Recommendation: As noted in 2001, we suggest the City improve cash receipting procedures which would include use of the cash register, endorsements of checks upon receipt with a stamp, and independent verification of class rosters. Corrective Action Plan: In 2003, the Recreation Department begm1 implementing the use of the cash register system, and intends to conduct an independent verification of class rosters. 2002 - 2: Police Department Receipts Condition: The City should maintain documentation reconciling police department receipts with the "'administrative tags" (City parking tickets) issued. Cun-ently, not all of the "tags" issued are accounted for during the reconciliation process. Also checks received are not endorsed upon receipt, and all receipts are stored in an unlocked box. Recommendation: We recommend that the City improve the reconciliation process for "administrative tags" by accounting for all tags issued. Also receipts should be endorsed upon receipt and stored in a secured area. Corrective Action Plan: The City will take corrective action to reconcile and account for all tags issued and payments received. 237 238 CITY OF COLUMBIA HEIGHTS, MINNESOTA SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ended December 31, 2002 SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT: 2002 - 3: Capital Funds Program, CFDA #14.872 Criteria: Requests for expenditure reimbursements should be submitted to HUD in a timely maImer in order to properly match expenditures and revenues in the appropriate periods. Also, BUD requires submission of the following arulual statement for each CFP grant in which all funds have not been fully obligated and/or expended. HUD-50075, PHA Plans (OMB No, 2577-0226). Condition: For the 2002 expenditures tested, the City complied with submitting timely requests for reimbursements and the annual report. However, several of the CFP 2002 revenues included reimbursements for 2000 and 2001 expenditures, and the 2000 and 2001 required annual repOlts were not submitted until 2002. Revenue recognized in 2002 of $9,268 should have been recognized in prior yeaI's. Questioned Cost: There were no questioned costs as a result of this finding. Recommendation: The City should develop internal control procedures to ensure that all requests for reimbursements and federal reports are submitted in a timely manner in order to match revenues and expenditures and fulfill the reporting requirements set forth by HUD. Corrective Action Plan: The HRA has complied with reporting and reimbursement requirements for the fiscal year ended December 31, 2002. In the future, the City will continue to ensure that required reports and reimbm'sement requests are filed in a timely manner. 239 240 CITY OF COLUMBIA HEIGHTS, MINNESOTA SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ended December 31, 2002 SECTION IV - PRIOR YEAR FINDINGS DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT: 2001-2: CDBG Proe:ram, CFDA #14.218, llassed-throue:h Anoka County Condition and Criteria: Certain documentation needs to be maintained in the City's files to substantiate that proper procedures have been followed when disbursing federal funds. During 2001 testing, two of the three housing rehabilitation grant files tested were missing the loan repayment agreements. Questioned Cost: No costs have been questioned as a result of this finding. Corrective Action Plan: The City has obtained copies of the loan repayment agreements from Anoka County and will maintain a copy in the recipient file. In the future, the City will ensure that appropriate information is maintained on file. Current Status: For 2002, the City maintained appropriate information on file. 2001-3: ClAP Program, CFDA #14.852 Condition and Criteria: The Davis-Bacon Act requires that all laborers who work on construction contracts in excess of $2,000 be paid not less than the prevailing wage rates. During 2000, the City entered into one contract that required compliance with the provision of the Davis-Bacon Act. The City was unable to provide information to verify compliance with Davis-Bacon in 2000 and 2001. Questioned Cost: The amOlmt of questioned costs has not been determined. Current Status: For 2002, the City maintained on file the appropriate information. 241 242 CITY OF COLUMBIA HEIGHTS, MINNESOTA SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS Year Ended December 31, 2002 Federal Funding Source! Pass Through Agency! Program Title Federal 2002 CFDA Federal Number Expenditures 16.592 $26,351 16.607 691 16.710 6,611 16.523 12,462 83.503 2,212 US. Department of Justice: Direct: Local Law Enforcement Block Grant Bulletproof Vest Partnership Program School Partnership Fund Passed -through State ofMN Department of Economic Security: Juvenile Accountability Incentive Block Grant Federal Emergency Management Agency: Passed-through Anoka County: Emergency Management Assistance Grant U.S. Department of Housing aud Urban Development: Passed-through Anoka County: Community Development Block Grant - Entitlement Grant (CDBG) Direct: Operating Subsidy Capital Funds Program (CFP) Total Federal Expenditures 14.218 383,183 14.850 14.872 111,124 256,723 $799,357 Notes to the schedule of expenditures of federal awards Note 1. Basis q{ Presentation The above schedule of expenditures of federal awards includes the federal grant activity ofthe City of Columbia Heights, Minnesota (including its component units) and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements ofOMB 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 ol~ the basic financial statements. Note 2. SlIbrecipienls During 2002, the City of Columbia Heights did not pass federal money to subreeipients. Note 3. Reporting Entity The City of Columbia Heights, Minnesota, for purposes of this schedule includes all funds of the primary government as defined by GASB Statement No. 14, The Financial Reporting Entity. This schedule also includes the Housing and Redevelopment Authority (HRA), and the Economic Development Authority (EDA) which are the sole component units of the City. 243 244 Tautges Redpath, Ltd. Certified Public Accountants and Consultants Independent Auditor's Report on Supplementary Information- Financial Data Schedule To the Honorable Mayor and Members of the City Council City of Columbia Heights, Minnesota We have audited the basic financial statements of the City of Columbia Heights, Minnesota, as of and for the year ended December 31, 2002, and have issued our report thereon dated April 9, 2003. Our audit was performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying Financial Data Schedule is presented for purposes of additional analysis as required by the U.S. Department of Housing and Urban Development and is not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole. This report is intended solely for the information and use of the City Council, management and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than those specified parties. April 9, 2003 !/Ltf ~ ~~ ~tl HLB TAUTGES REDPATH, LTD. Certified Public Accountants White Bear Lake Office: 4810 White Bear Parkway, White Bear Lake, MN 55110, USA Telephone: 651 4267000 Fax: 651 4265004 Hastings Office: 1303 South Frontage Road, Suite 13, Hastings, MN 55033, USA Telephone: 6514804990 Fax: 651 4265004 HLB Tautges Redpath, Ltd. is a member of I!IIlnternational. A world-wide organiz~61i ~ accounting firms and business advisors. 246 CITY OF COLUMBIA HEIGHTS, MINNESOTA U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT FINANCIAL DATA SCHEDULE As of and For The Year Ended December 31, 2002 Page 1 of2 Line Item Public Housing Operating Subsidy 14.850 ACCOWlt Description Current Assets: Current assets: 111 Cash - umestricted 100 Total cash $432,356 432,356 122 126 129 120 144 150 Accounts and notes receivable: Accounts receivable - HUD otber projects Accounts receivable - dwelling rents Accrued interest receivable Total receivables, net of allowance Interprogram - due from Total current assets 81 4,792 4,873 90,361 527,590 161 162 163 164 160 166 Noncurrent assets: Capital assets: Land Buildings Furniture, equipment and machinery - dwellings Furniture, equipment and machinery - administration Total capital assets Less: accumulated depreciation Tota] capita] assets, net of accumulated depreciation Total noncurrent assets 128,700 4,127,633 431,279 5,144 4,692,756 (3,786,239) 906,517 906,517 180 190 Total assets 1,434,107 312 321 333 341 347 310 350 300 Liabilities: Current liabilities: Accounts payable <= 90days Accrued wages/payroll taxes payable Accounts payable - other governments Tenant security deposits 1nterprogram - due to Total current liabilities Tota] noncurrent liabilities Totalliabilities 53,197 o 53,197 $17,774 52 22,091 13,280 508.1 512.1 513 Net Assets: Investment in capital assets, net ofre]ated debt Unrestricted Total net assets 906,517 474,393 $1,380,910 247 Public Housing Capital Flmd Program 14.872 $ - o 240,629 240,629 240,629 o o o 240,629 $150,268 90,361 240,629 o 240,629 $0 248 CITY OF COLUMBIA HEIGHTS, MINNESOTA U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT FINANCIAL DATA SCHEDULE As of and For The Year Ended December 31, 2002 Page 2 of2 Public Housing Public Housing Operating Capital Fund Line Subsidy Program Item Account Description 14.850 14.872 Revenue: 703 Net tenant rental revcnue $278,733 $ - 704 Tenant revenue - other 7,544 706 ffiJD PHA grants 111,124 256,723 711 Investment income - unrestricted 28,169 700 Total revenue 425,570 256,723 Expenses: 911 Administrative salaries 1,302 912 Auditing fees 1,154 913 Outside management fees 104,009 916 Other operating - administrative 4,686 924 Tenant services - other 184 931 Water 7,177 932 Electricity 29,854 933 Gas 24,721 938 Other utilities expense 8,196 941 Ordinary maintenance and operations - labor 30,547 942 Ordinary maintenance and operations - materials 1,889 961 Insurance premiums 24,024 962 Other general expenses 11,500 963 Payments in lieu of taxes 22,091 969 Total operating expenses 271,334 0 974 Depreciation 145,385 900 Total expenses 416,719 0 1001 Operating transfers in 256,723 1002 Operating transfers out (256,723) 1010 Total other financing sources (uses) 256,723 (256,723) 1000 Excess (deficiency) oftotal revenue over (under) total expenses 265,574 0 Memo account infomlation: 1103 Beginning equity 338,362 1104 Prior period adjustments, equity transfers and correction of errors 776,974 N/A 1113 Maximum annual contributions commitment (per ACC) N/A N/A 1115 Contingency reserve, ACC program reserve N/A N/A 1116 Total annual contributions available N/A N/A 1120 Unit months available 1,200 N/A 1121 Number of unit months leased 1,197 N/A Equity roll forward test: Calculation from RlE statement 1,380,910 B/S line 513 1,380,910 Difference $0 $0 249 250