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HomeMy WebLinkAbout2010 CAFRCOMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE CITY OF COLUMBIA HEIGHTS STATE OF MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2010 - This page intentionally left blank - CITY OF COLUMBIA HEIGHTS, MINNESOTA TABLE OF CONTENTS Page ReferenceNo. I. INTRODUCTORY SECTION Principal City Officials 3 Organizational Chart 4 Letter of Transmittal 5 Certificate of Achievement for Excellence in Financial Reporting 9 II. FINANCIAL SECTION Independent Auditor's Report 13 Management's Discussion and Analysis 15 Basic Financial Statements: Government-Wide Financial Statements: Statement of Net Assets Statement 132 Statement of Activities Statement 234 Fund Financial Statements: Balance Sheet - Governmental Funds Statement 336 Statement of Revenues, Expenditures and Changes in Fund Balance - Governmental Funds Statement 438 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities Statement 541 Statement of Net Assets - Proprietary Funds Statement 642 Statement of Revenues, Expenses and Changes in Fund Net Assets - Proprietary Funds Statement 744 Statement of Cash Flows - Proprietary Funds Statement 846 Statement of Fiduciary Net Assets - Fiduciary Funds Statement 950 Notes to Financial Statements 51 Required Supplementary Information: Budgetary Comparison Schedule - General Fund Statement 1084 Schedule of Funding Progress for the Retiree Health Plan Statement 1186 Budgetary Comparison Schedule - Note to RSI 87 CITY OF COLUMBIA HEIGHTS, MINNESOTA TABLE OF CONTENTS Page ReferenceNo. Combining and Individual Fund Statements and Schedules: Combining Balance Sheet - Nonmajor Governmental FundsStatement 1292 Combining Statement of Revenues, Expenditures and Changes in Fund Balance - Nonmajor Governmental FundsStatement 1393 Subcombining Balance Sheet - Nonmajor Special Revenue FundsStatement 1498 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balance - Nonmajor Special Revenue FundsStatement 15100 Special Revenue Funds: Schedules of Revenues, Expenditures and Changes in Fund Balance: Budget and Actual - Cable Television FundStatement 16102 Actual - Police Forfeiture FundStatement 17103 Budget and Actual - Police Community Programs FundStatement 18104 Actual - Police Grants FundStatement 19105 Budget and Actual - Library FundStatement 20106 Actual - After School Programs FundStatement 21107 Actual - Recreation Contributed Projects FundStatement 22108 Actual - Contributed Projects - Other FundStatement 23109 Actual - Special Projects FundStatement 24110 Budget and Actual - Community Development FundStatement 25111 Actual - Anoka County Comm Dev Programs FundStatement 26112 Economic Development Authority (Component Unit): Budgetary Comparison Schedule - Administration Fund Statement 27113 Housing and Redevelopment Authority (Component Unit): Combining Balance Sheet Statement 28114 Combining Statement of Revenues, Expenditures and Changes in Fund Balance Statement 29115 Schedules of Revenues, Expenditures and Changes in Fund Balance: Budget and Actual - Parkview Villa North Fund Statement 30116 Budget and Actual - Parkview Villa South Fund Statement 31117 CITY OF COLUMBIA HEIGHTS, MINNESOTA TABLE OF CONTENTS Page ReferenceNo. Subcombining Balance Sheet - Nonmajor Debt Service Funds Statement 32120 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balance - Nonmajor Debt Service FundsStatement 33122 Subcombining Balance Sheet - Nonmajor Capital Project FundsStatement 34126 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balance - Nonmajor Capital Project FundsStatement 35128 Enterprise Funds: Water Utility Fund: Subcombining Schedule of Net Assets Statement 36132 Subcombining Schedule of Revenues, Expenses and Changes in Fund Net AssetsStatement 37133 Subcombining Schedule of Cash FlowsStatement 38134 Sewer Utility Fund: Subcombining Schedule of Net Assets Statement 39135 Subcombining Schedule of Revenues, Expenses and Changes in Fund Net AssetsStatement 40136 Subcombining Schedule of Cash FlowsStatement 41137 Refuse Utility Fund: Subcombining Schedule of Net Assets Statement 42138 Subcombining Schedule of Revenues, Expenses and Changes in Fund Net AssetsStatement 43139 Subcombining Schedule of Cash FlowsStatement 44140 Storm Sewer Utility Fund: Subcombining Schedule of Net Assets Statement 45141 Subcombining Schedule of Revenues, Expenses and Changes in Fund Net AssetsStatement 46142 Subcombining Schedule of Cash FlowsStatement 47143 Liquor Fund: Subcombining Schedule of Net Assets Statement 48145 Subcombining Schedule of Revenues, Expenses and Changes in Fund Net AssetsStatement 49146 Subcombining Schedule of Cash FlowsStatement 50148 Internal Service Funds: Combining Statement of Net AssetsStatement 51152 Combining Statement of Revenues, Expenses and Changes in Fund Net Assets Statement 52153 Combining Statement of Cash Flows Statement 53154 CITY OF COLUMBIA HEIGHTS, MINNESOTA TABLE OF CONTENTS Page ReferenceNo. Central Garage Fund: Subcombining Schedule of Net Assets Statement 54155 Subcombining Schedule of Revenues, Expenses and Changes in Fund Net AssetsStatement 55156 Subcombining Schedule of Cash FlowsStatement 56157 Information Systems Fund: Subcombining Schedule of Net Assets Statement 57158 Subcombining Schedule of Revenues, Expenses and Changes in Fund Net AssetsStatement 58159 Subcombining Schedule of Cash FlowsStatement 59160 Insurance Fund: Subcombining Schedule of Net Assets Statement 60161 Subcombining Schedule of Revenues, Expenses and Changes in Fund Net AssetsStatement 61162 Subcombining Schedule of Cash FlowsStatement 62163 Compensated Absences Fund: Subcombining Schedule of Net Assets Statement 63164 Subcombining Schedule of Revenues, Expenses and Changes in Fund Net AssetsStatement 64165 Subcombining Schedule of Cash FlowsStatement 65166 Combining Statement of Changes in Assets and Liabilities - Agency Funds Statement 66168 III. STATISTICAL SECTION (UNAUDITED) Financial Trends: Net Assets by Component Table 1 172 Changes in Net Assets Table 2 174 Fund Balances - Governmental Funds Table 3 178 Changes in Fund Balances - Governmental Funds Table 4 180 Revenue Capacity: Tax Capacity Value and Estimated Market Value of All Taxable Property Table 5 184 Direct and Overlapping Property Tax Rates Table 6 185 Principal Property Taxpayers Table 7 187 Property Tax Levies and Collections Table 8 188 CITY OF COLUMBIA HEIGHTS, MINNESOTA TABLE OF CONTENTS Page ReferenceNo. Debt Capacity: Ratios of Outstanding Debt by TypeTable 9190 Ratios of Outstanding Net General Bonded Debt by TypeTable 10192 Direct and Overlapping Governmental Activities DebtTable 11194 Legal Debt Margin InformationTable 12195 Pledged Revenue Coverage Non-obligation DebtTable 13196 Demographic and Economic: Demographic and Economic StatisticsTable 14197 Principal EmployersTable 15199 Operating Information: City Government Employees by Function/ProgramTable 16200 Operating Indicators by Function/ProgramTable 17202 Capital Asset Statistics by Function/ProgramTable 18204 IV. OTHER REQUIRED REPORTS SECTION Report on Compliance with Minnesota Legal Compliance Audit Guide for Political Subdivisions209 Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 211 Schedule of Expenditures of Federal Awards 214 Report on Compliance with Requirements That Could Have a Direct and Material Effect on Each Major Program and on Internal Control Over Compliance in Accordance with OMB Circular A-133216 Schedule of Findings and Questioned Costs 220 Report on Supplementary Information - Financial Data Schedule224 U.S. Department of Housing and Urban Development: Financial Data Schedule 225 Financial Data Schedule - Statement and Certification of Actual Modernization Costs227 - This page intentionally left blank - I. INTRODUCTORY SECTION 1 - This page intentionally left blank - 2 CITY OF COLUMBIA HEIGHTS, MINNESOTA PRINCIPAL CITY OFFICIALS December 31, 2010 Name Official Title Mayor and Council: Gary L. Peterson Mayor Tammera Ericson Diehm Councilmember Bruce Kelzenberg Councilmember Bruce Nawrocki Councilmember Robert A. Williams Councilmember Administration: Walter Fehst City Manager Linda Magee Assistant to City Manager William Elrite City Clerk-Treasurer, Finance Director Jim Hoeft City Attorney Kevin Hansen Public Works Director, City Engineer Scott Nadeau Chief of Police Gary Gorman Chief of Fire M. Rebecca Loader Librarian Scott Clark Community Development Director Keith Windschitl Recreation Services Director Larry Scott Liquor Operations Manager Lauren McClanahan Superintendent of Public Works 3 City of Columbia Heights Organizational Chart 2010 Mayor: Gary L. Peterson Council Members: Tammera Diehm Bruce Nawrocki Bruce Kelzenberg Robert Williams City Manager: Walter Fehst Commissions & Boards: Charter EDA HRA Traffic Telecommunications Planning & Zoning Park & Recreation Library ADMINISTRATION Assistant to the City Manager / Human Resources Director:Linda Magee City Clerk Administrative Assistant – Human Resources Imaging Technician (PT) Intern-Cable (PT) Facilities Maintenance Supervisor Custodian I (3 PT)POLICE (Administered by Mayor) Police Chief: Scott Nadeau Office Supervisor Police Captain Sergeants (3) Corporals (2) Patrol Officers (21) Community Service Officers (1 FT) (2 PT) Reserves Police IS Specialist Secretary II-A (2) Clerk Typist FIRE/EMERGENCY MANAGEMENT Fire Chief:Gary Gorman Assistant Fire Chief Fire Captains (3) Secretary II (PT) Clerk Typist II (PT) Firefighters (3) On-Call Firefighters (20) PUBLIC WORKS Public Works Director/City Engineer: Kevin Hansen Secretary II-A Assistant City Engineer Administrative Assistant Assessing Clerk (PT) Engineering Technician IV (2) Engineering Technician III Public Works Superintendent Foreman (Parks, Sewer & Water, Streets) (3) Maintenance Worker (15) Supervisor-Vehicle Maintenance Maintenance III -Mechanic Maintenance III -Bodyman/Painter FINANCE Finance Director/Treasurer:William Elrite Secretary II Assistant Finance Director Accounting Coordinator Payroll Accountant Budget Coordinator Accounting Clerk II: Utility Accounting Clerk I: Utility Receptionist/Switchboard Operator Meter Reader (PT) Liquor Operations Manager Assistant Liquor Operations Manager (5) PT Store Supervisor (5) Retail Clerk (30 PT) IS Director IS Technician IS Technician Assistant COMMUNITY DEVELOPMENT Community Development Director: Scott Clark Assistant Community Development Director Building Official Planner Secretary II: Permits LIBRARY Library Director:M. Rebecca Loader Clerk-Typist II (2) Library Clerk (1 PT) Library Supervisor (4 PT) Page (8 PT) Library Aide (PT) Adult Services Librarian Children's Librarian RECREATION Recreation Director: Keith Windschitl Clerk/Typist II Senior Citizen Coordinator Program Coordinator Recreation Clerk (PT) Custodian II (7 PT) Custodian I (PT) 4 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 OPPORTUNITY EMPLOYER City of Columbia Heights Finance Department 590 40th Avenue N.E. Columbia Heights, MN 55421-3878 Office (763) 706-3600 TDD (763) 706-3692 Fax (763) 706-3637 June 16, 2011 To the Citizens of the City of Columbia Heights, Mayor, Council Members, and City Manager The Comprehensive Annual Financial Report of the City of Columbia Heights for the fiscal year ended December 31, 2010, is hereby submitted. The City’s management assumes responsibility for both the completeness and reliability of the information contained in this report, based on a comprehensive framework of internal control that it has established for this purpose. Because the cost of internal control should not exceed its anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements. HLB Tautges Redpath, Ltd., Certified Public Accountants, have issued an unqualified (“clean”) opinion on the City of Columbia Heights financial statements for the year ended December 31, 2010. Their independent auditors’ report is located at the front of the financial section of this report. State law requires Minnesota cities to issue by June 30th of each year a complete set of audited financial statements for the preceding fiscal year ended December 31st. In addition, state law requires that Minnesota cities undergo an annual Minnesota Legal Compliance Audit. During the year ended December 31, 2010, the City expended more than $500,000 in federal grant awards. The City was therefore required to have an 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 for 2010. Information related to the Minnesota Legal Compliance Audit and the Single (A-133) Audit, including the Schedule of Expenditures of Federal Awards is included in the Other Required Reports Section at the back of this report. 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. PROFILE OF THE GOVERNMENT The City of Columbia Heights, 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. Information Systems Financial Reporting Accounts Payable Utility Billing Payroll 5 The City Council consists of a Mayor and four Council Members. All are elected at-large, on a non-partisan basis. The Mayor serves a two-year term and the Council Members serve four-year terms. The City Manager is appointed by the City Council. The City covers an area of 3.52 square miles and currently has a population of 19,496. The City is empowered to levy a tax on both real and personal property within its boundaries. All City funds, departments, commissions and other organizations for which the City of Columbia Heights is financially accountable, including all component units, are presented within the Comprehensive Annual Financial Report. The Columbia Heights Housing and Redevelopment Authority (HRA) and the Columbia Heights Economic Development Authority (EDA) are included in the reporting entity as blended 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/burden with the authorities. The City provides a full range of services to its citizens. These services include, but are not limited to, police and fire protection; water and sanitation services; the construction and maintenance of highways, streets, and infrastructure; library; recreational facilities; and general administrative services. LOCAL ECONOMY The City is located within the varied and stable economic base of the Minneapolis-Saint Paul greater metropolitan area, which is a major center for both the state and the Upper-Midwest. As such, there has been a relatively stable level of employment for City residents and this is expected to continue. In 2010, the largest employers located within the boundaries of the City included Independent School District 13 and one division of Medtronic Inc., a medical device manufacturer. With its close proximity to the Minneapolis downtown area (4 miles), the City of Columbia Heights offers opportunities for many people to live close to where they work, and this has helped maintain demand for housing in the City. However, as an older, fully developed, inner- ring suburb of the City of Minneapolis, the management and residents of the City of Columbia Heights are faced with the problems of an aging infrastructure, crime, and dependency on state aid to supplement local revenues. The recent sharp rise nation-wide in home mortgage foreclosures has also been reflected locally. The City Council and the City’s management are taking a proactive approach to dealing with these concerns, and they currently have a number of initiatives in progress to address them. Some of these are described below. LONG-TERM FINANCIAL PLANNING The City has a planned Street Rehabilitation Program including, as needed, water mains, sanitary sewer and storm sewer improvements. The program divides the City into seven street rehabilitation zones and calls for approximately one zone to be rehabilitated every one to two years. A portion of cost of street rehabilitation is charged to the benefiting properties in the form of special assessments. In some cases, the City issues bonds to initially finance the project, repaying the bonds with special assessments collected over a number of years. 6 Historically, local government aid (LGA) from the State of Minnesota has been a key component of the City’s operating budget. In recent years, the amount provided by the state has been unpredictable, significantly reduced, and sometimes reduced retroactively. To provide for more stable operations, the City’s management has developed a multi-year financial plan that would transition LGA out of the City’s operating budget by 2013. Thereafter, under the plan, LGA would be used only to reduce the City’s bond levies and/or for capital outlay. The current City Council has reached consensus of opinion in support of the plan. Implementation of this plan is of course dependent on the annual property tax levy and operating budget actually adopted by the City Council each year. RELEVANT FINANCIAL POLICIES By Council resolution, a portion of the unreserved fund balance in the general fund is designated for working capital purposes. This is targeted at 45% of the general fund budget for the following year. At December 31, 2010, there was sufficient unreserved fund balance in the general fund to meet this goal. The City’s policy is to budget and recognize license and permit revenues of the community development function, such as building permit revenue, in the Community Development Fund, a non-major special revenue fund. License and permit revenues of other functions are budgeted and recognized in the general fund. For this reason, license and permit revenues in the general fund are often lower than other comparable Minnesota Cities, which more commonly budget for and recognize all license and permit revenues in the general fund. CURRENT MAJOR INITIATIVES As in much of the nation, home prices in the City have dropped sharply over the last few years. Given this, plus the age of the City’s housing stock, the Economic Development Authority has implemented a program of purchasing and demolishing substandard residential property to create an inventory of redevelopment property available for resale when the housing market recovers. As of December 31, 2010, twenty-three properties had been acquired under this program. A majority of the buildings on these properties were also demolished by December 31, 2010. In 2008, the City began construction of a new $12 million public safety facility, financed with general obligation bonds. This project was completed in early 2010. AWARD AND AKNOWLEDGEMENTS The Government Finance Officers' Association (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, 2009. The Certificate of Achievement is a prestigious national award that recognizes conformity 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. 7 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. 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, Joseph P. Kloiber Finance Director - from June 1, 2011 Assistant Finance Director – to May 31, 2011 8 9 - This page intentionally left blank - 10 II. FINANCIAL SECTION 11 - This page intentionally left blank - 12 13 14 MANAGEMENT’S DISCUSSION AND ANALYSIS As management of the City of Columbia Heights, Minnesota (the City), 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, 2010. 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 in the introductory section of this report. Financial Highlights The assets of the City exceeded its liabilities at December 31, 2010, by $66,663,584 (net assets). Of this amount, $29,867,917 or 45% are unrestricted net assets that may be used to meet the City’s ongoing obligations to citizens and creditors in accordance with the City’s fund designations and fiscal policies. During 2010, the City’s total net assets increased by $3,495,530 or 6% from the prior year. Governmental activities provided $2,409,737 of this increase, and the City’s business-type activities provided the remaining $1,085,793. As of December 31, 2010, the combined fund balances of the City’s governmental funds were $25,439,109. This is an increase of $315,773 or 1% from the prior year. This increase in governmental fund balances is significantly less than the aforementioned increase in the net assets of governmental activities, primarily due to the different treatment each requires for reporting current year capital asset additions. The portion of the combined governmental fund balances at December 31, 2010, that was both unreserved and undesignated was $786,054. As of December 31, 2010, the general fund balance of $5,342,239 included $77,204 reserved for prepayments; $4,553,470 designated for working capital; $171,646 designated for certain program purposes; and $483,446 unreserved undesignated. During 2010, the City’s total bonded debt decreased by $1,318,000 to an end of year total of $28,277,998. This decrease was from the payment of principal due in the current year. Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements are comprised of three components: 1) government- wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. Government-wide financial statements. The government-wide financial statements are designed to provide readers with a broad overview of the City’s finances, in a manner similar to a private-sector 15 Management’s Discussion and Analysis business. The statement of net assets presents information on all of the City’s 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 is improving or deteriorating. 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 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 include general government, public safety, public works, culture and recreation and community development. The business-type activities of the City include water, sanitary sewer, refuse, storm sewer and liquor operations. The government-wide financial statements are presented as Statements 1 and 2 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, 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 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 government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term 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 government-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. 16 Management’s Discussion and Analysis 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 each major governmental fund. The major governmental funds in 2010 are as follows: • General fund • 2008A taxable G.O. housing improvement area bonds fund • Public safety center capital building fund • Municipal state aid street fund • Capital improvements general government buildings fund • Capital equipment replacement general government fund • Capital improvements-PIR fund • Capital improvements development fund Data from the other governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these non-major governmental funds is provided in the form of combining statements elsewhere in this report. The City adopts an annual appropriated budget for its general and certain special revenue funds listed in the notes to the financial statements. A budgetary comparison statement has been provided for these funds to demonstrate compliance with this budget. The basic governmental fund financial statements are presented as Statements 3 through 5 of this report. Proprietary funds. The City maintains two different types of proprietary funds. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its water, sewer, refuse, storm sewer, and liquor operations. Internal service funds are an accounting device used to accumulate and allocate costs internally among the City’s various functions. The City uses internal service funds to account for its central garage, information systems, insurance, and compensated absences services. Because the central garage, 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 information systems 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, sewer, refuse, storm sewer and liquor operations, all of which are considered to be major funds of the City. 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. The basic proprietary fund financial statements are presented as Statements 6 through 8 of this report. 17 Management’s Discussion and Analysis 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’s own programs. The accounting used for fiduciary funds is much like that used for proprietary funds. The basic fiduciary fund financial statement is presented as Statement 9 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. Other information. Required supplementary information on funding for retiree health benefits is presented immediately following the budgetary comparison referred to above. The combining statements referred to earlier in connection with non-major governmental funds and internal service funds are presented immediately following the schedule of funding progress for the retiree health plan. Combining and individual fund statements and schedules are presented as Statements 12 through 66 of this report. Government-wide Financial Analysis As noted above, net assets may serve over time as a useful indicator of a government’s financial position. At December 31, 2010, the City’s assets exceeded its liabilities by $66,663,584. $34,323,362 or 51% of the City’s net assets, reflects its investment in capital assets (e.g. land, buildings, equipment and infrastructure) less any related debt used to acquire those assets that is still outstanding. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. It should be noted that, although net assets invested in capital assets are reported net of related debt, 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. In addition, a portion of the City’s net assets represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net assets, $29,867,917 or 45%, may be used to meet the City’s ongoing obligations to citizens and creditors. At December 31, 2010, the City is able to report positive balances in all three categories of net assets, both for the City as a whole, as well as for its separate governmental and business-type activities. 18 Management’s Discussion and Analysis 2010 2009 2010 2009 2010 2009 Assets: Current and other assets $32,269,084$32,372,541$8,480,960$8,544,103$40,750,044$40,916,644 Capital assets 42,939,58441,377,86114,522,56114,482,27857,462,14555,860,139 Total assets $75,208,668$73,750,402$23,003,521$23,026,381$98,212,189 $96,776,783 Liabilities: Current liabilities $2,753,559$2,709,281 $1,027,725$1,758,879$3,781,284$4,468,160 Noncurrent liabilities 20,999,36721,995,1166,767,9547,145,45327,767,32129,140,569 Total liabilities $23,752,926$24,704,397$7,795,679$8,904,332$31,548,605$33,608,729 Net assets: Invested in capital assets net of related debt $26,279,178$24,163,911$8,044,184$7,459,474$34,323,362$31,623,385 Restricted 2,034,0302,458,743438,275648,4352,472,3053,107,178 Unrestricted 23,142,53422,423,351 6,725,3836,014,14029,867,91728,437,491 Total net assets $51,455,742$49,046,005$15,207,842$14,122,049$66,663,584$63,168,054 TotalsGovernmental Activities Business-Type Activities CITY OF COLUMBIA HEIGHTS' NET ASSETS 2010 2009 2010 2009 2010 2009 Revenues: Program revenues: Charges for services $2,336,094 $2,117,812 $14,143,485 $13,654,206$16,479,579$15,772,018 Operating grants and contributions 1,061,343 911,225 36,653 50,105 1,097,996 961,330 Capital grants and contributions 3,616,597 1,903,549 - - 3,616,597 1,903,549 General revenues: Property taxes 8,825,502 8,046,318 - - 8,825,502 8,046,318 Tax increment collections 812,965 1,244,684 - - 812,965 1,244,684 Grants and contributions not restricted to specific programs 1,176,934 1,731,185 - - 1,176,934 1,731,185 Unrestricted investment earnings487,611 475,345 86,110 92,672 573,721 568,017 Gain on sale of capital assets used in governmental activities - 82,704 - - - 82,704 Total revenues 18,317,046 16,512,822 14,266,248 13,796,983 32,583,294 30,309,805 Expenses: General government 2,013,7501,761,334 - - 2,013,7501,761,334 Public safety 5,473,2244,591,977 - - 5,473,2244,591,977 Public works 2,777,9662,794,189 - - 2,777,9662,794,189 Culture and recreation 2,479,5192,182,856 - - 2,479,5192,182,856 Community development 2,295,5742,385,405 - - 2,295,5742,385,405 Interest on long-term debt 959,320961,392 - - 959,320961,392 Water - - 2,000,1011,927,8112,000,101 1,927,811 Sewer - - 1,478,5181,737,1341,478,518 1,737,134 Refuse - - 1,426,4861,290,5281,426,486 1,290,528 Storm sewer - - 272,355376,884272,355 376,884 Liquor - - 7,910,9517,701,9617,910,951 7,701,961 Total expenses 15,999,353 14,677,153 13,088,411 13,034,318 29,087,764 27,711,471 Increase (decrease) in net assets before transfers 2,317,693 1,835,669 1,177,837 762,665 3,495,530 2,598,334 Transfers 92,044 383,990 (92,044) (383,990) - - Increase (decrease) in net assets 2,409,737 2,219,659 1,085,793 378,675 3,495,530 2,598,334 Net assets - January 1 49,046,005 46,826,346 14,122,049 13,743,374 63,168,054 60,569,720 Net assets - December 31 $51,455,742$49,046,005$15,207,842$14,122,049$66,663,584$63,168,054 CITY OF COLUMBIA HEIGHTS' CHANGES IN NET ASSETS Governmental Activities Business-Type Activities Totals 19 Management’s Discussion and Analysis Governmental activities. During the current year, governmental activities increased the City’s total net assets by $2,409,737 or 4%. During the prior year, governmental activities increased the City’s net assets by $2,219,659 or 4%. Key differences between the current and prior year change in net assets of governmental activities include: • Capital grants and contributions increased by $1.7 million or 90% in 2010, compared to the prior year. This was primarily due to two federal grants for replacement of a pedestrian bridge. • All other changes in revenues of the governmental activities were approximately offsetting. For example, a continuing decline in state aid revenue was offset by an increase in general property taxes under the City’s multi-year plan to phase out reliance on state aid for general operations. Also a decline in tax increment collections in 2010, due to the expiration of certain tax increment districts, was somewhat offset by the parcels from those expired districts now being subject to the City’s general property tax levy. • Expenses of the governmental activities increased by $1.3 million or 9% in 2010, compared to the prior year. $881,247 of this expense increase was in the public safety function, representing a 19% increase over the prior year. This public safety increase was split roughly equally between increases in depreciation and operating expenses of new facilities and equipment on the one hand, and personnel increases on the other. • The increase in public safety personnel expenses was a combination of two new police officer positions funded by operating grant revenue, plus two factors that affected all City functions: o During 2009, a mandatory two-week furlough for all fulltime employees was imposed as a one-time cost reduction measure. o Certain council-approved cost of living increases occurred in 2010. • The net transfers-in from the City’s business-type activities to its governmental activities decreased by $291,946 or 76%. This net decrease primarily reflects the use of tax increment collections from the governmental activities to improve a section of the Central Avenue sanitary sewer. After completion, ownership of the portion of this project paid by the governmental activities was transferred to the sewer function within the business-type activities. 20 Management’s Discussion and Analysis Governmental Activities -2010 Revenues Charges for services 13% Program-specific grants 26% Property taxes 48% Tax increment 4% Other revenues 9% Governmental Activities -2010 Expenses General government 13% Public works 17% Culture and recreation 15% Community development 14% Interest on long-term debt 6% Public safety 35% 21 Management’s Discussion and Analysis Business-type activities. In 2010, business-type activities increased the City’s total net assets by $1,085,793 or 2%. In the prior year, business-type activities increased the City’s net assets by $378,675 or less than 1%. The key differences between the current and prior year change in business-type activities net assets were within the sewer function, including the following: • As mentioned above, the portion of the 2010 Central Avenue sewer improvement paid by the governmental activities was transferred in 2010 to the sewer function within the business- type activities. This increased the net assets of the business-type activities by $234,668. • Charges for sewer services increased $128,826 or 9% in 2010 compared to the prior year. This reflects one-time sewer availability charges (SAC) from redevelopment. • Sewer expenses decreased $258,616 or 15% in 2010 compared to the prior year. This was primarily due to certain infrastructure-related sewer projects that were carried out in 2009, but not in 2010. These projects did not reach the dollar threshold at which the City capitalizes infrastructure. Consequently, all of these project expenses were recognized in 2009 instead of being depreciated over many years. Business-Type Activities - 2010 Revenues Charges for services 99% Other revenues 1% 22 Management’s Discussion and Analysis Financial Analysis of the City’s Funds As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance- related legal requirements. Governmental funds. The focus of the City’s governmental funds is to provide information on near- term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City’s 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 December 31, 2010, the City’s governmental funds reported combined fund balances of $25,439,109. Of this total, $23,811,834 or 94% is unreserved fund balance. The remaining fund balance is reserved, because $80,250 has already been committed for prepaid items and $1,547,025 represents real estate held for resale. The general fund is the chief operating fund of the City. In 2010, fund balance in the general fund increased by $546,088 or 11%. In the prior year, fund balance in the general fund increased by $1,040,194 or 28%. Key differences between the current and prior year change in the fund balance of the general fund include the following: • Total general fund revenue remained approximately same in 2010 as in the prior year. The amount of market value homestead credit, an intergovernmental revenue received from the State of Minnesota, decreased $281,493 or 62% in 2010, as compared to the prior year. This decrease was offset by increases in most other revenue line items. The decrease in market value homestead credit was imposed in 2010 as part of the state’s budget reduction measures. • Total general fund expenditures increased $837,631 or 10% in 2010, as compared to the prior Business-Type Activities - 2010 Expenses Water 15% Refuse 11% Storm sewer 2% Liquor 61% Sewer 11% 23 Management’s Discussion and Analysis year. The majority of this increase, $682,878 was in personnel expenditures. This personnel increase was driven by most of the same factors listed above in the analysis of governmental activities: o During 2009, a mandatory two-week furlough for all fulltime employees was imposed as a one-time cost reduction measure. o Two new police officer positions funded by intergovernmental revenue were added in 2010. o Certain council-approved cost of living increases occurred in 2010. o Staffing for elections occurred in 2010. No election was held in 2009. • Transfers into the general fund from other funds, net of transfers out, increased by $310,808 or 172% in 2010, as compared to the prior year. This was primarily the result of one-time transfers to close certain nonmajor governmental funds in 2010. The changes in fund balance of the other major governmental funds in 2010, and key elements of those changes, were as follows: • The 2008A Taxable GO Housing Improvement Area Bonds Fund decreased by $61,328. This primarily reflects the transfer of $37,500 to the General Fund and $37,500 to the nonmajor governmental funds, which represents the administrative fees earned in prior years by the City in this rehabilitation project. • The Public Safety Center Capital Building Fund decreased by $135,058. This reflects the 2010 expenditure of funds received by this capital project in prior years. • The Municipal State Aid Street Fund decreased by $126,644. This decrease reflects the 2010 transfer of revenue received in prior years to the nonmajor governmental funds for certain debt service. 2010 revenues and expenditures were approximately equal in this fund. • The Capital Improvements General Government Buildings Fund increased by $71,137. This is the amount by which 2010 investment income and transfers-in for building improvements exceeded 2010 building improvements. • The Capital Equipment Replacement General Government Fund decreased by $298,608. This is the amount by which 2010 equipment purchases exceeded 2010 investment income and transfers-in for equipment purchases. • The Capital Improvements PIR Fund decreased by $518,986. This primarily reflects the 2010 transfer of certain special assessments and other sources received by this fund in prior years to the nonmajor governmental funds for debt service purposes. • The Capital Improvements Development Fund increased by $770,019. This primarily reflects several transfers and other 2010 interfund transactions designed to consolidate governmental fund balance designated for redevelopment into a smaller number of funds than reported in 24 Management’s Discussion and Analysis prior years. The combined total fund balances of the nonmajor governmental funds increased by $69,153 or less than 1% in 2010. Whereas in the prior year, combined total fund balances of the nonmajor governmental funds increased by $1,785,636 or 21%. This difference involved numerous changes, but the most significant elements included: • Property tax revenue in the nonmajor governmental funds increased $705,186 or 52% in 2010, compared to the prior year. The majority of this increase was related to taxes levied to pay debt service related to a new public safety building. • Certain transfers into the nonmajor governmental funds in 2009 from the Municipal State Aid Street Fund were one-time items only and totaled $737,270. • One-time transfers in 2010 from the nonmajor governmental funds to the General Fund, the Capital Improvements General Government Buildings Fund, and the Capital Improvements Development Fund, were made in 2010 to close several small funds for efficiency. Proprietary funds. The City’s proprietary funds provide the same type of information that is found in the government-wide financial statements for business-type activities, but in more detail. At December 31, 2010, net assets of the major proprietary funds included the following amounts of unrestricted net assets (deficit): • Water Fund $957,639 • Sewer Fund $2,473,141 • Refuse Fund $841,294 • Storm Sewer Fund $25,873 • Liquor Fund $1,679,714 The 2010 increases (decreases) in net assets of the major proprietary funds included the following: • Water Fund $443,671 • Sewer Fund $320,142 • Refuse Fund $111,664 • Storm Sewer Fund $73,813 • Liquor Fund $157,382 Other factors concerning the finances of the proprietary funds are addressed above in the analysis of the City’s business-type activities. 25 Management’s Discussion and Analysis Budgetary Highlights General fund. The changes between the original and final 2010 general fund budget consist of: • An increase of $47,047 to budgeted public safety expenditures, and an equal increase to the combined amount budgeted for intergovernmental revenue and charges for services. This reflects additional police and fire services and training funded by external entities after the adoption of the original budget. • A reclassification of $535,625 from tax revenue to intergovernmental revenue – market value homestead credit. The City’s policy is to adopt the original budget using the classifications required to certify the annual tax levy to Anoka County for collection. A portion of the tax levy certified under this classification is never actually received from the County in the form of tax revenue. This portion is received from the State of Minnesota as intergovernmental revenue - the market value homestead credit. Each year, after the levy has been adjusted for this item by Anoka County, an amendment to the original budget is recorded to reflect the County’s adjustment. Actual general fund revenues in 2010 were more than budgeted by $241,033 or 3%. This variance was primarily the result of the following: • Actual local government aid received from the State of Minnesota was $469,842 more than budgeted for in 2010. This was however, offset by the actual amount of market value homestead credit received from the State of Minnesota being $365,784 less than budgeted. • The City received certain surplus amounts totaling $105,097 from various tax increment financing districts in 2010. These amounts were not anticipated, and were not included in the budgeted amount of property tax revenue. Actual general fund expenditures in 2010 were less than budgeted by $480,740 or 5%. By far the largest element of this variance was $212,434 in the parks and recreation departments: • 2010 was the first year of operations at a new gymnasium facility. Actual expenditures were less than budgeted by $63,135 for this facility. Limited information was available upon which to estimate many first year costs. Significant seasonal staffing was budgeted for the facility, but much of the actual staffing was achieved by relocating existing staff from another facility. • Other operations within parks and recreation used less seasonal and overtime staffing than budgeted. Some of this reflects staff re-assigned to programs outside the general fund, and some reflects a continuation of overall cost reduction measures implemented in 2009 in response to state aid reductions and weak economic conditions in general. • A full-time maintenance position in the recreation department was unfilled for part of 2010. 26 Management’s Discussion and Analysis The remaining $268,306 of the general fund expenditure budget variance was spread across all departments of the general fund, other than police and engineering. To a large extent, this reflects a continuation of cost reduction measures implemented in 2009 in response to state aid reductions and weak economic conditions in general. Capital Asset and Debt Administration Capital assets. The City’s capital assets for its governmental and business-type activities as of December 31, 2010, amount to $57,462,145 net of accumulated depreciation. This investment in capital assets includes land, buildings, equipment, infrastructure, and construction in progress. Note that real estate that is only held for resale is not included here in the analysis of capital assets used in governmental and business-type activities. At December 31, 2010, the City had $482,000 of noncancellable contractual commitments for construction in 2010. Significant capital asset activity during 2010 included the following: Year Project StartedCost to DateStatus Public safety center 2008$12,389,346in-service Street reconstruction - Zone 4 2009 629,239 in-progress Street reconstruction - Zone 5 2010 593,991 in-progress Central avenue pedestrian bridge 2009 2,649,367 in-progress Central avenue sewer upsizing 2010 473,843 in-service As of December 31, 2010 27 Management’s Discussion and Analysis City of Columbia Heights’ Capital Assets Beginning Ending BalanceAdditionsDeletionsBalance Governmental activities: Capital assets - not being depreciated: Land $3,625,692$1,266,089$ - $4,891,781 Construction in progress 13,059,2113,448,117(12,824,259)3,683,069 Total capital assets not being depreciated16,684,9034,714,206(12,824,259)8,574,850 Capital assets - being depreciated: Buildings 16,925,14710,460,127 - 27,385,274 Equipment 6,496,0421,287,484 - 7,783,526 Infrastructure 25,435,996 - - 25,435,996 Total capital assets being depreciated 48,857,18511,747,611 060,604,796 Less accumulated depreciation for: Buildings 9,289,897674,806 - 9,964,703 Equipment 4,384,817522,632 - 4,907,449 Infrastructure 10,489,512878,398 - 11,367,910 Total accumulated depreciation 24,164,2262,075,836 026,240,062 Capital assets being depreciated - net 24,692,9599,671,775 034,364,734 Governmental activities capital assets - net41,377,86214,385,981(12,824,259)42,939,584 Business-type activities: Capital assets - not being depreciated: Land 2,343,247 - - 2,343,247 Construction in progress 103,820671,049(471,361)303,508 Total capital assets not being depreciated2,447,067671,049(471,361)2,646,755 Capital assets - being depreciated: Buildings 4,581,314 - - 4,581,314 Equipment 2,031,792 - - 2,031,792 Infrastructure 13,909,245471,361 - 14,380,606 Total capital assets being depreciated 20,522,351471,361 020,993,712 Less accumulated depreciation for: Buildings 836,860133,372 - 970,232 Equipment 1,225,924137,256 - 1,363,180 Infrastructure 6,424,356360,138 - 6,784,494 Total accumulated depreciation 8,487,140630,766 09,117,906 Capital assets being depreciated - net 12,035,211(159,405)011,875,806 Business-type activities capital assets - net14,482,278511,644(471,361)14,522,561 Total capital assets - net $55,860,140$14,897,625($13,295,620)$57,462,145 Additional information on the City’s capital assets can be found in Note 4 to the financial statements. Long-term debt. During 2010, the City’s total bonded debt decreased by $1,318,000 to an end of year total of $28,277,998. This decrease was from the payment of principal due in the current year. Bonded debt outstanding at year end included general obligation bonds, all of which are backed by the full faith and credit of the City, and revenue bonds, for which only revenues from the related projects financed are pledged for repayment. Some of the general obligation bonds have specific revenue sources pledged other than property taxes, but in the event those other sources were 28 Management’s Discussion and Analysis insufficient, the City would be required to fund the shortfall through property taxes. State statute limits the amount of certain general obligation debt that a Minnesota city may issue to 3% of the taxable market value of property within a city’s taxing jurisdiction. At December 31, 2010, the City’s debt limit under this statute was $38,979,705 and $13,855,000 of the City’s outstanding debt was of the type to which this limit applies. City of Columbia Heights’ Long-Term Debt At December 31, 2010, the City’s general obligation bonds have an AA rating from Standard and Poor’s and Aa2 rating from Moody’s. The outstanding revenue bonds of the business activities at December 31, 2010, are repaid only with lease revenue and have an A1 rating from Moody’s. The outstanding revenue bonds of the governmental activities at December 31, 2010, are repaid only with tax increment and are unrated. In addition to bonded debt, at year end there was long-term debt in the amount of $1,003,871 and $30,661 respectively, for compensated absences and post-employment health insurance. Additional information on the City’s long-term debt can be found in Note 6 to the financial statements. Economic Factors and Next Year’s Budget In 2010, the average annual unemployment rate for Anoka County, which includes the City, was 7.5%. This is a decrease from a rate of 8.5% from the prior year. This compares to the average 2010 state and national rates of 7.2% and 9.0% respectively. Inflationary trends in the region compare favorably to national trends. In 2010, there were a significant number of residential mortgage foreclosures in the City. However, sufficient data is not available to compare this to the related state and national foreclosure trends. These factors were considered in preparing the City of Columbia Heights’ 2011 budget. 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. 2010 2009 2010 2009 2010 2009 General obligation bonds: Repaid only with general taxes$13,855,000$13,940,000$ - $ - $13,855,000$13,940,000 With other pledged revenues 4,556,7505,194,4862,128,2482,540,5126,684,9987,734,998 Revenue bonds 2,838,0002,881,0004,900,0005,040,0007,738,0007,921,000 Compensated absences 866,723763,636137,148123,4111,003,871887,047 Postemployment benefits other than pensions 30,661 20,141 - - 30,661 20,141 $22,147,134$22,799,263$7,165,396$7,703,923$29,312,530$30,503,186 Governmental Activities Business-Type Activities Totals 29 - This page intentionally left blank - 30 BASIC FINANCIAL STATEMENTS 31 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF NET ASSETS Statement 1 December 31, 2010 Page 1 of 2 With Comparative Totals For December 31, 2009 GovernmentalBusiness-Type ActivitiesActivities20102009 Current assets: Cash and investments$25,577,485$3,971,661$29,549,146$30,163,142 Cash and investments with fiscal agent - 399,254399,254408,632 Receivables: Accounts (net of allowance for uncollectibles)142,4571,336,9991,479,4561,362,436 Special assessments - current492,979 - 492,979447,525 Taxes 535,070 - 535,070512,201 Interest105,86418,700124,564108,817 Due from other governmental units - current1,238,3481,6911,240,039663,562 Internal balances(267,277)267,277 - - Prepayments130,720162,620293,340298,368 Inventory - at cost39,0222,322,7582,361,7802,173,848 Real estate held for resale1,547,025 - 1,547,0251,693,169 Total current assets29,541,6938,480,96038,022,65337,831,700 Noncurrent assets: Special assessments receivable - noncurrent2,683,791 - 2,683,7913,041,344 Loans receivable - noncurrent43,600 - 43,60043,600 Due from other governmental units - noncurrent - - - - Capital assets (net of accumulated depreciation): Land4,891,7812,343,2477,235,0285,968,938 Buildings17,420,5713,611,08221,031,65311,379,704 Equipment2,876,077668,6143,544,6912,917,093 Infrastructure14,068,0867,596,11021,664,19622,431,373 Construction in process3,683,069303,5083,986,57713,163,031 Total noncurrent assets45,666,97514,522,56160,189,53658,945,083 Total assets75,208,66823,003,52198,212,18996,776,783 Totals Primary Government Assets The accompanying notes are an integral part of these financial statements. 32 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF NET ASSETS Statement 1 December 31, 2010 Page 2 of 2 With Comparative Totals For December 31, 2009 GovernmentalBusiness-Type ActivitiesActivities 2010 2009 Current liabilities: Accounts payable $552,259$240,255$792,514$1,201,283 Accrued salaries and withholdings payable 163,609 39,420 203,029 245,160 Contracts payable - retained percentage 126,623 31,100 157,723 262,480 Due to other governmental units 176,632 179,900 356,532 579,457 Unearned revenue 179,543 - 179,543 230,796 Accrued interest payable 374,218 139,608 513,826 545,727 Deposits 32,908 - 32,908 40,640 Compensated absences payable - current 114,147 18,062 132,209 44,617 Bonds payable - current 1,033,620 379,3801,413,0001,318,000 Total current liabilities 2,753,5591,027,7253,781,2844,468,160 Noncurrent liabilities: Compensated absences payable - noncurrent 752,576 119,086 871,662 842,430 Other postemployment benefits payable - noncurrent 30,661 - 30,661 20,141 Bonds payable - noncurrent 20,216,1306,648,86826,864,99828,277,998 Total noncurrent liabilities 20,999,3676,767,95427,767,32129,140,569 Total liabilities 23,752,9267,795,67931,548,60533,608,729 Invested in capital assets - net of related debt 26,279,1788,044,18434,323,36231,623,385 Restricted for: Debt service 1,025,220 438,2751,463,4951,191,378 Tax increment purposes 1,008,810 - 1,008,8101,915,800 Unrestricted 23,142,5346,725,38329,867,91728,437,491 Total net assets $51,455,742$15,207,842$66,663,584$63,168,054 Liabilities Net assets Primary Government Totals The accompanying notes are an integral part of these financial statements. 33 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF ACTIVITIES For The Year Ended December 31, 2010 With Comparative Totals For The Year Ended December 31, 2009 Charges For Expenses Services Functions/Programs Primary government: Governmental activities: General government $2,013,750 $192,005 Public safety 5,473,224 715,205 Public works 2,777,967 44,211 Culture and recreation 2,479,518 269,825 Community development 2,295,574 1,114,848 Interest on long-term debt 959,320 - Total governmental activities 15,999,353 2,336,094 Business-type activities: Water 2,000,101 2,503,506 Sewer 1,478,518 1,594,322 Refuse 1,426,486 1,542,312 Storm sewer 272,355 345,086 Liquor 7,910,951 8,158,259 Total business-type activities 13,088,411 14,143,485 Total primary government $29,087,764 $16,479,579 The accompanying notes are an integral part of these financial statements. 34 Statement 2 Operating Capital Grants andGrants andGovernmentalBusiness-Type ContributionsContributionsActivities Activities 2010 2009 $ - $194,842($1,626,903)$ - ($1,626,903)($1,589,979) 559,482 16,026(4,182,511) - (4,182,511)(3,500,402) 166,468 2,848,179 280,891 - 280,891 (915,615) 93,474 15,724(2,100,495) - (2,100,495)(1,821,870) 241,919 541,826 (396,981) - (396,981)(955,309) - - (959,320) - (959,320)(961,392) 1,061,343 3,616,597(8,985,319)0(8,985,319)(9,744,567) - - - 503,405 503,405 543,446 - - - 115,804 115,804 (271,638) 36,653 - - 152,479 152,479 143,556 - - - 72,731 72,731 (6,294) - - - 247,308 247,308 260,923 36,653 0 0 1,091,727 1,091,727 669,993 $1,097,996$3,616,597(8,985,319)1,091,727(7,893,592)(9,074,574) General revenues: Property taxes 8,825,502 - 8,825,502 8,046,318 Tax increment collections 812,965 - 812,965 1,244,684 Grants and contributions not restricted to specific programs 1,176,934 - 1,176,934 1,731,185 Unrestricted investment earnings 487,611 86,110 573,721 568,017 Gain on sale of capital assets used in governmental activities - - - 82,704 Transfers 92,044 (92,044) - - Total general revenues and transfers11,395,056 (5,934)11,389,12211,672,908 Change in net assets 2,409,737 1,085,793 3,495,530 2,598,334 Net assets - January 1 49,046,00514,122,04963,168,05460,569,720 Net assets - December 31 $51,455,742$15,207,842$66,663,584$63,168,054 Totals Net (Expense) Revenue and Changes in Net AssetsProgram Revenues Primary Government The accompanying notes are an integral part of these financial statements. 35 CITY OF COLUMBIA HEIGHTS, MINNESOTA BALANCE SHEET GOVERNMENTAL FUNDS December 31, 2010 General Fund 2008A Taxable GO Housing Improvement Area Bonds Fund Public Safety Center Capital Building Fund Municipal State Aid Street Fund Assets Cash and investments $4,700,993 $163,038 $351,623 $135,841 Receivables: Accounts 34,962 - - - Special assessments - 918,321 - - Taxes 478,734 - - - Interest 34,764 700 1,800 - Loans - - - - Due from other governmental units 159,592 - - 914,929 Interfund receivable 784,867 - - - Prepayments 77,204 - - - Real estate held for resale - - - - Total assets $6,271,116$1,082,059 $353,423$1,050,770 Liabilities and Fund Balances Liabilities: Accounts payable $132,081$ - $10,450 $70,043 Accrued salaries and withholdings payable 137,469 - - 1,750 Contracts payable - retained percentage - - 759 88,277 Due to other governmental units 128,814 - - 1,424 Interfund payable - - - 599,685 Deferred revenue 530,513 918,321 - - Deposits - - - - Total liabilities 928,877 918,321 11,209 761,179 Fund balances: Reserved for: Prepayments 77,204 - - - Real estate held for resale - - - - Unreserved: Designated, reported in: General fund 4,781,589 - - - Special revenue funds - - - - Debt service funds - 163,738 - - Capital projects funds - - 342,214 289,591 Undesignated, reported in: General fund 483,446 - - - Special revenue funds - - - - Debt service funds - - - - Total fund balances 5,342,239 163,738 342,214 289,591 Total liabilities and fund balances $6,271,116$1,082,059 $353,423$1,050,770 Fund balance reported above 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, information systems, insurance and compensated absences to individual funds. With the exception of the information systems 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. Net assets of governmental activities The accompanying notes are an integral part of these financial statements. 36 Statement 3 Capital Improvements General Gov't Buildings Capital Equipment Replacement General Gov't Capital Improvements PIR Fund Capital Improvement Development Other Governmental Funds Interfund Eliminations Total Governmental Funds 2010 $1,584,629$4,513,995$1,197,615$1,869,754$8,872,740$ - $23,390,228 - - - 61,123 46,372 - 142,457 - - 2,258,449 - - - 3,176,770 - - - - 56,336 - 535,070 9,000 18,400 7,400 5,400 24,000 - 101,464 - - - - 43,600 - 43,600 - - 14,571 - 149,256 - 1,238,348 - - - - 21,737 (806,604) - - - - - 3,046 - 80,250 - - 53,300 171,3821,322,343 - 1,547,025 $1,593,629$4,532,395$3,531,335$2,107,659$10,539,430($806,604)$30,255,212 $ - $26,888 $49,253$ - $235,192$ - $523,907 - - 1,907 - 18,676 - 159,802 - - 36,206 - 1,381 - 126,623 - - 3,292 - 43,102 - 176,632 - - - - 234,340 (806,604)27,421 - - 2,198,412 - 121,564 - 3,768,810 - - 6,331 - 26,577 - 32,908 0 26,8882,295,401 0 680,832 (806,604)4,816,103 - - - - 3,046 - 80,250 - - 53,300 171,3821,322,343 - 1,547,025 - - - - - - 4,781,589 - - - - 2,828,792 - 2,828,792 - - - - 3,609,254 - 3,772,992 1,593,6294,505,5071,182,6341,936,2771,792,555 - 11,642,407 - - - - - - 483,446 - - - - 361,826 - 361,826 - - - - (59,218) - (59,218) 1,593,6294,505,5071,235,9342,107,6599,858,598 025,439,109 $1,593,629$4,532,395$3,531,335$2,107,659$10,539,430($806,604)$30,255,212 $25,439,109 41,822,359 3,589,267 2,259,636 (21,654,629) $51,455,742 The accompanying notes are an integral part of these financial statements. 37 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE GOVERNMENTAL FUNDS For The Year Ended December 31, 2010 General Fund 2008A Taxable GO Housing Improvement Area Bonds Fund Public Safety Center Capital Building Fund Municipal State Aid Street Fund Revenues: Taxes $6,770,957$ - $ - $ - Tax increment collections - - - - Special assessments - 105,588 - - Licenses and permits 179,883 - - - Intergovernmental 1,657,280 - - 2,437,289 Charges for services 587,971 - - - Fines and forfeitures 159,836 - - - Investment income: Interest and dividends 122,147 3,800 9,700 - Change in fair value (26,141)(900)(2,400) - Other revenues 15,435 - - - Total revenues 9,467,368 108,488 7,300 2,437,289 Expenditures: Current: General government 1,774,104 - - - Public safety 4,808,713 - - - Public works 1,352,131 - - 151,633 Cultureandrecreation 1411042 The accompanying notes are an integral part of these financial statements. Culture and recreation 1,411,042 - - - Community development - - - - Capital outlay: General government - - - - Public safety - - 142,358 - Public works 67,004 - - 2,291,300 Culture and recreation - - - - Community development - - - - Debt service: Principal retirement - 40,000 - - Interest and fiscal charges - 54,816 - - Developer incentives - - - - Total expenditures 9,412,994 94,816 142,358 2,442,933 Revenues over (under) expenditures 54,374 13,672 (135,058)(5,644) Other financing sources (uses): Transfers in 699,500 - - - Transfers out (207,786)(75,000) - (121,000) Sale of capital assets - - - - Total other financing sources (uses)491,714 (75,000)0 (121,000) Net change in fund balance 546,088 (61,328)(135,058)(126,644) Fund balance - January 1 4,796,151 225,066477,272 416,235 Fund balance - December 31 $5,342,239$163,738$342,214$289,591 The accompanying notes are an integral part of these financial statements. 38 Statement 4 Capital Improvements General Gov't Buildings Capital Equipment Replacement General Gov't Capital Improvements PIR Fund Capital Improvement Development Other Governmental Funds Interfund Eliminations Total Governmental Funds 2010 $ - $ - $ - $ - $2,044,743$ - $8,815,700 - - - - 815,935 - 815,935 - - 914,746 - - - 1,020,334 - - - - 299,265 - 479,148 - - - - 841,874 - 4,936,443 - - 44,190 65,255953,356 - 1,650,772 - - - - 28,857 - 188,693 33,600 99,700 36,000114,600164,706 - 584,253 (8,200)(24,200)(8,700)(4,500)(39,900) - (114,941) - - 922 - 257,089 - 273,446 25,400 75,500 987,158 175,355 5,365,925 0 18,649,783 262 - 9,322 - 143,294 - 1,926,982 - - 112,581 - 47,139 - 4,968,433 - - 213,525 - 14,412 - 1,731,701 2512 781298 2194852 The accompanying notes are an integral part of these financial statements. 2,512 - - - 781,298 - 2,194,852 - - - 19,4541,331,914 - 1,351,368 - - - - - - - - 94,914 - - - - 237,272 - 200,051255,395 - 111,424 - 2,925,174 65,237129,143 - - - - 194,380 - - 3,094240,652959,252 - 1,202,998 - - - - 725,736 - 765,736 - - - - 926,465 - 981,281 - - - - 141,005 - 141,005 68,011 424,108 593,917 260,106 5,181,939 0 18,621,182 (42,611)(348,608)393,241 (84,751)183,986 0 28,601 726,010 50,000362,2801,004,7702,507,950(4,943,238)407,272 (612,262) - (1,274,507)(150,000)(2,622,783)4,943,238(120,100) - - - - - - - 113,748 50,000 (912,227)854,770 (114,833)0 287,172 71,137 (298,608)(518,986)770,019 69,153 0 315,773 1,522,4924,804,1151,754,9201,337,6409,789,445 - 25,123,336 $1,593,629$4,505,507$1,235,934$2,107,659$9,858,598 $0$25,439,109 The accompanying notes are an integral part of these financial statements. 39 - This page intentionally left blank - 40 CITY OF COLUMBIA HEIGHTS, MINNESOTA RECONCILIATION OF THE STATEMENT OF REVENUES,Statement 5 EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES For The Year Ended December 31, 2010 Amounts reported for governmental activities in the statement of activities (Statement 2) are different because: Net changes in fund balances - total governmental funds (Statement 4)$315,773 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 difference is the amount by which outlays for capital assets exceeded depreciation in the current year.1,610,963 The issuance of long-term debt provides current financial resources to the governmental funds, while repayment of the principal of long-term debt consumes the current financial resources of the governmental funds. Neither transaction has any effect on net assets however. This amount is the net effect of these differences in the treatment of long-term debt.765,736 Interest that accrues in the prior year on long-term debt, that is paid in the current year, consumes current financial resources, and is therefore reported in the governmental funds. It does not reduce net assets however, and is not reported as an expense in the statement of activities.21,961 Other postemployment employee benefits that accrue in the current year, but are not paid in the current year, do not consume current financial resources, and are therefore not reported in the governmental funds. They do reduce net assets however, and are reported as an expense in the statement of activities.(10,520) Revenue earned in prior years, that first becomes available in the current year, is reported in the governmental funds. Whereas, this amount was reported in the statement of activities in the prior year(s) in which it was earned.(351,036) The net expenses of certain activities of internal service funds are reported within governmental activities in the statement of activities.56,860 Change in net assets of governmental activities (Statement 2)$2,409,737 The accompanying notes are an integral part of these financial statements. 41 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF NET ASSETS PROPRIETARY FUNDS December 31, 2010 Assets:Water Utility FundSewer Utility Fund Current assets: Cash and cash equivalents$738,512$1,998,393 Cash and cash equivalents with fiscal agent - - Receivables: Accounts (net of allowance for uncollectibles)532,616345,876 Interest 3,8008,500 Due from other governmental units - current - - Interfund receivable 18,947 111,289 Prepayments - 75,091 Inventory - at cost 2,143 - Total current assets 1,296,018 2,539,149 Noncurrent assets: Capital assets: Land 45,223 36,586 Construction in progress 161,470 102,690 Buildings 559,826 100,426 Equipment 456,629 840,942 Infrastructure 7,420,389 5,482,680 Total capital assets 8,643,537 6,563,324 Less: accumulated depreciation (3,840,014)(3,975,466) Net capital assets 4,803,523 2,587,858 Total noncurrent assets 4,803,523 2,587,858 Total assets 6,099,541 5,127,007 Liabilities: Current liabilities: Accounts payable 7,859 4,388 Accrued salaries and withholdings payable 9,734 3,846 Due to other governmental units 92,292 - Interfund payable - - Contracts payable - 31,100 Accrued interest payable 27,049 - Compensated absences payable - current 3,229 3,513 Bonds payable - current 191,805 - Total current liabilities 331,968 42,847 Noncurrent liabilities: Compensated absences payable - noncurrent 21,291 23,161 Bonds payable - noncurrent 1,578,768 - Total noncurrent liabilities 1,600,059 23,161 Total liabilities 1,932,027 66,008 Net assets: Invested in capital assets, net of related debt 2,969,888 2,587,858 Restricted for debt service 239,987 - Unrestricted 957,639 2,473,141 Total net assets $4,167,514 $5,060,999 Adjustments to reflect the consolidation of internal service fund activities related to enterprise funds Net assets of business-type activities Business-Type Activities - Enterprise Funds The accompanying notes are an integral part of these financial statements. 42 Statement 6 Business-Type Activities - Enterprise Funds Refuse Utility Fund Storm Sewer Utility Fund Liquor Fund Total Enterprise Funds Internal Service Funds 2010 2010 $572,189 $6,057 $7,000 $3,322,151 $2,836,767 - - 399,254 399,254 - 379,455 78,636 416 1,336,999 - 2,500 900 300 16,000 7,100 - - 1,691 1,691 - - - - 130,236 - - - 87,529 162,620 50,470 - - 2,320,615 2,322,758 39,022 954,144 85,593 2,816,805 7,691,709 2,933,359 - 254,724 2,006,714 2,343,247 15,779 - 39,348 - 303,508 - 6,000 - 3,915,062 4,581,314 1,585,993 108,690 95,719 375,215 1,877,195 353,508 - 1,477,536 - 14,380,605 - 114,690 1,867,327 6,296,991 23,485,869 1,955,280 (113,190)(551,097)(524,640)(9,004,407)(796,956) 1,500 1,316,230 5,772,351 14,481,462 1,158,324 1,500 1,316,230 5,772,351 14,481,462 1,158,324 955,644 1,401,823 8,589,156 22,173,171 4,091,683 106,421 3,232 117,706 239,606 29,001 1,149 1,996 18,490 35,215 8,012 - - 87,608 179,900 - - - 102,815 102,815 - - - - 31,100 - - 5,731 106,828 139,608 - 695 171 8,698 16,306 115,903 - 37,575 150,000 379,380 - 108,265 48,705 592,145 1,123,930 152,916 4,585 1,124 57,345 107,506 764,156 - 320,100 4,750,000 6,648,868 - 4,585 321,224 4,807,345 6,756,374 764,156 112,850 369,929 5,399,490 7,880,304 917,072 1,500 958,555 1,359,130 7,876,931 1,158,324 - 47,466 150,822 438,275 - 841,294 25,873 1,679,714 5,977,661 2,016,287 $842,794 $1,031,894 $3,189,666 14,292,867 $3,174,611 914,975 $15,207,842 The accompanying notes are an integral part of these financial statements. 43 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS PROPRIETARY FUNDS For The Year Ended December 31, 2010 Water Utility FundSewer Utility Fund Operating revenues: Charges for services$178,309$1,592,133 Charges for sales, net of discounts (Note 1C)2,236,231 - Sale of water meters 83,224 - Total operating revenues2,497,764 1,592,133 Operating expenses: Cost of sales, services and goods sold1,034,837866,612 Operating expense 641,649385,293 Depreciation 209,889177,083 Total operating expenses1,886,375 1,428,988 Net income (loss) from operations611,389 163,145 Nonoperating revenues (expenses): Investment income: Interest and dividends 20,500 55,405 Change in fair value (4,900)(11,200) Intergovernmental - - Miscellaneous revenues 5,742 2,189 Interest and fiscal charges (67,492)(17) Totalnonoperatingrevenues(expenses)(46150)46377 Business-Type Activities - Enterprise Funds The accompanying notes are an integral part of these financial statements. Total nonoperating revenues (expenses)(46,150)46,377 Net income (loss) before transfers 565,239 209,522 Capital contributions - 234,668 Transfers in - - Transfers out (121,568)(124,048) Total transfers and capital contributions (121,568)110,620 Change in net assets 443,671 320,142 Total net assets - January 1 3,723,843 4,740,857 Total net assets - December 31 $4,167,514 $5,060,999 Change in net assets as reported above Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds Change in net assets of business-type activities Reconciliation of capital contributions and interfund transfers: Amount reported above Amounts reported for business-type activities in the statement of activities are different because: Adjustment to reflect consolidation of internal service fund activities Transfer in of capital assets from governmental activities Amounts reported on the statement of activities The accompanying notes are an integral part of these financial statements. 44 Statement 7 Refuse Utility Fund Storm Sewer Utility FundLiquor Fund Total Enterprise Funds Internal Service Funds 20102010 $1,539,842$342,820$ - $3,653,104$959,697 - - 8,158,25910,394,490161,534 - - - 83,224 - 1,539,842 342,820 8,158,259 14,130,818 1,121,231 1,238,703 - 6,220,511 9,360,663 1,248,829 130,756 186,068 1,248,331 2,592,097 - 300 74,330 147,844 609,446 70,560 1,369,759 260,398 7,616,686 12,562,206 1,319,389 170,083 82,422 541,573 1,568,612 (198,158) 13,700 4,600 1,505 95,710 39,000 (3,300)(1,100)(400)(20,900)(9,400) 36,653 - - 36,653 - - 2,266 - 10,197 - - (14,375)(244,672)(326,556) - 47053 (8609)(243567)(204896)29600 Business-Type Activities - Enterprise Funds The accompanying notes are an integral part of these financial statements. 47,053 (8,609)(243,567)(204,896)29,600 217,136 73,813 298,006 1,363,716 (168,558) - - - 234,668 - - - - - 240,790 (105,472) - (140,624)(491,712)(36,250) (105,472)0 (140,624)(257,044)204,540 111,664 73,813 157,382 1,106,672 35,982 731,130 958,081 3,032,284 13,186,195 3,138,629 $842,794 $1,031,894 $3,189,666 $14,292,867 $3,174,611 $1,106,672 (20,879) $1,085,793 Capital Transfers - Contributions Net $234,608 ($491,712) - 165,000 (234,608)234,668 $0 ($92,044) The accompanying notes are an integral part of these financial statements. 45 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS For The Year Ended December 31, 2010 Water Utility FundSewer Utility Fund Cash flows from operating activities: Cash received from customers $2,466,710 $1,660,882 Cash received from interfund goods and services provided - - Cash paid to suppliers for goods and services (1,441,403)(1,183,192) Cash payments to employees for services (356,190)(214,162) Net cash flows provided by (used in) operating activities 669,117 263,528 Cash flows from noncapital financing activities: Transfers in - - Transfers out (121,568)(124,048) Intergovernmental - - Interfund receivable repaid by (advanced to) other funds (18,947)75,359 Interfund payable advanced by other funds - - Net cash flows provided by (used in) noncapital financing activities (140,515)(48,689) Cash flows from capital and related financing activities: Acquisition of capital assets (57,650)(339,382) Principal payments - bonds (269,029)(4,653) Interest and fiscal charges - including capitalized interest (72,103)(100) Net cash flows provided by (used in) capital and related financing activities(398,782)(344,135) Cash flows from investing activities: Investment income: Interest and dividends 19,200 54,305 Change in fair value (4,900)(11,200) Net cash flows provided by (used in) investing activities 14,300 43,105 Net increase (decrease) in cash and cash equivalents 144,120 (86,191) Total cash and cash equivalents - January 1 594,392 2,084,584 Total cash and cash equivalents - December 31 738,512 1,998,393 (Less) cash and cash equivalents with fiscal agent - December 31 - - Cash and cash equivalents - December 31 $738,512 $1,998,393 Business-Type Activities - Enterprise Funds The accompanying notes are an integral part of these financial statements. 46 Statement 8 Page 1 of 2 Refuse Utility Fund Storm Sewer Utility FundLiquor FundEnterprise Funds Internal Service Funds 2010 2010 $1,491,169 $341,895 $8,157,262 $14,117,918 $12,989 - - - - 1,790,184 (1,283,089)(129,707)(6,977,383)(11,014,774)(849,124) (82,990)(101,250)(913,123)(1,667,715)(991,042) 125,090 110,938 266,756 1,435,429 (36,993) - - - - 265,790 (105,472) - (140,624)(491,712)(61,250) 68,824 - - 68,824 - - - - 56,412 - - - 102,815 102,815 - (36,648)0 (37,809)(263,661)204,540 - (39,348)(2,290)(438,670) - - (138,582)(140,000)(552,264) - - (16,745)(239,712)(328,660) - 0 (194,675)(382,002)(1,319,594)0 13,100 4,500 1,205 92,310 38,300 (3,300)(1,100)(400)(20,900)(9,400) 9,800 3,400 805 71,410 28,900 98,242 (80,337)(152,250)(76,416)196,447 473,947 86,394 558,504 3,797,821 2,640,320 572,189 6,057 406,254 3,721,405 2,836,767 - - (399,254)(399,254) - $572,189 $6,057 $7,000 $3,322,151 $2,836,767 Business-Type Activities - Enterprise Funds The accompanying notes are an integral part of these financial statements. 47 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS For The Year Ended December 31, 2010 Water Utility FundSewer Utility Fund Reconciliation of operating income (loss) to net cash flows from operating activities Operating income (loss)$611,389 $163,145 Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation expense 209,889 177,083 Miscellaneous revenues 5,742 2,189 Changes in assets and liabilities: (Increase) decrease in accounts receivable (36,796)(16,789) (Increase) decrease in due from other governmental units - 83,349 (Increase) decrease in prepayments - (2,873) Adjustment for nonoperating portion - - (Increase) decrease in inventory, at cost 552 - Increase (decrease) in accounts payable (422)(111,583) Increase (decrease) in accrued salaries and withholdings payable 4,620 850 Increase (decrease) in contracts payable - retained percentage - (35,550) Adjustment for nonoperating portion - - Increase (decrease) in due to other governmental units (127,962) - Increase (decrease) in deposits payable (1,000) - Increase (decrease) in compensated absences payable 3,105 3,707 Total adjustments 57,728 100,383 Net cash flows from operating activities $669,117 $263,528 Noncash capital and related financing activities: Contribution of capital asset from government $ - $234,668 Business-Type Activities - Enterprise Funds The accompanying notes are an integral part of these financial statements. 48 Statement 8 Page 2 of 2 Refuse Utility Fund Storm Sewer Utility FundLiquor FundEnterprise Funds Internal Service Funds 2010 2010 $170,083 $82,422 $541,573 $1,568,612 ($198,158) 300 74,330 147,844 609,446 70,560 - 2,266 - 10,197 - (48,673)(3,191)62 (105,387) - - - (1,059)82,290 - - - 7,837 4,964 5,370 - - (7,837)(7,837) - - (186,258)(185,706)(2,226) 2,487 2,083 (247,848)(355,283)(21,560) (7)1,333 3,911 10,707 2,384 - - (2,290)(37,840) - - - 2,290 2,290 - - (48,401)6,152 (170,211) - - - - (1,000) - 900 96 2,379 10,187 106,637 (44,993)28,516 (274,817)(133,183)161,165 $125,090 $110,938 $266,756 $1,435,429 ($36,993) $ - $ - $ - $234,668 $ - Business-Type Activities - Enterprise Funds The accompanying notes are an integral part of these financial statements. 49 CITY OF COLUMBIA HEIGHTS, MINNESOTA STATEMENT OF FIDUCIARY NET ASSETS Statement 9 FIDUCIARY FUNDS December 31, 2010 Assets: Cash and investments $6,714 Due from other governmental units 196 Total assets $6,910 Liabilities: Accounts payable $4,757 Due to other governmental units 2,153 Total liabilities $6,910 The accompanying notes are an integral part of these financial statements. 50 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City of Columbia Heights, Minnesota (the City) was incorporated in 1898. A Council composed of an elected mayor and four council members governs the City. The Council exercises legislative authority and determines all matters of policy. The Manager, appointed by the Council, is responsible for the proper administration of all affairs relating to the City. The financial statements of the City have been prepared in conformity 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 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. These blended component units, although legally separate entities, are, in substance, part of the City’s operations. The component units include Governmental Funds using the modified accrual basis of accounting, and as such are reported as Special Revenue Funds. 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 government and its component units. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use or directly benefit from goods, services or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not included among program revenues are reported instead as general revenues. 51 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 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 financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. The City’s only fiduciary funds are agency funds. Agency funds are custodial in nature and do not involve measurement of results of operations. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the City considers 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 judgments, 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 susceptible to accrual and so have been recognized as revenues of the current 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 City. The City reports the following major governmental funds: The general fund is the City’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 2008A taxable GO housing improvement area bonds fund was established to account for revenues and expenditures associated with the 2008A series general obligation taxable bonds issued to finance rehabilitation of the Sullivan Shores town homes development. These bonds will be repaid with special assessments to the rehabilitated properties. 52 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 The public safety center capital building fund was established to account for the planning, development and construction of a police and fire facility. The municipal state aid street fund is maintained according to state statute to account for maintenance and construction of municipal state aid street systems. The capital improvements general government buildings fund is used to account for construction and improvements to municipal buildings not accounted for in a separate fund. The capital equipment replacement – general government fund was established to account for the replacement of capital assets as needed. The capital improvement – PIR fund was established to account for projects that will be assessed to the affected properties. The capital improvement – development fund was established to account for redevelopment projects. The City reports the following major proprietary funds: The water fund accounts for revenue and expenses associated with water services to area residents. The sewer fund 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 sewer fund accounts for revenues and expenses associated with storm water disposal. The liquor fund accounts for revenues and expenses associated with the operation of three off-sale liquor stores. Additionally, the City reports the following fund types: Internal service funds account for central garage, information systems, insurance, and compensated absences services provided to other departments of the City on a cost reimbursement basis. Agency - The permit surcharge agency fund is used to account for building permit surcharges collected for the State of Minnesota, and sewer availability charges collected for the Metropolitan Council. The Tri-City GIS fund is used to account for the joint purchase of certain services by the City of Columbia Heights, the City of Fridley and the City of Andover. Private-sector standards of accounting and financial reporting issued prior to December 1, 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-sector guidance for their business-type 53 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 activities and enterprise funds, subject to this same limitation. The City 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. Elimination of these charges would distort the direct costs and program revenues reported 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 enterprise funds and of the internal service funds are charges to customers for sales and services. Liquor fund sales are reported net of discounts. No other fund provides discounts. For 2010, liquor sales discounts were $77,795. 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 City’s policy to use restricted resources first, and then use unrestricted resources as they are needed. D. BUDGETARY DATA The City Manager submits to the City Council a proposed operating budget for the fiscal year commencing on January 1 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 Fund and the following special revenue funds: Nonmajor special revenue funds: Cable television fund Police community programs fund Library fund Community development fund Economic Development Authority (component unit): Economic Development Authority administration fund Housing and Redevelopment Authority (component unit): Parkview villa north fund Parkview villa south fund 54 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 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 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 extent 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 interfund payable in the fund with the deficit, until adequate resources are received. The interfund balances are eliminated on the government-wide financial statements. Investments are stated at fair value, based upon quoted market prices, except for investments in 2a7-like external investment pools, which are stated at amortized cost. At December 31, 2010, the City had no investments in 2a7-like external investment pools. Investment income is accrued at the balance sheet date. F. RECEIVABLES AND PAYABLES During the course of operations, numerous transactions occur between individual funds for goods provided or services rendered. Short-term interfund loans are classified as “interfund receivables/payables.” All short-term interfund receivables and payables at December 31 are planned to be eliminated in the subsequent year. 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.” Because utility bills are considered liens on property, no estimated uncollectible amounts are established. Uncollectible amounts are not material for property taxes, special assessments and other receivables, and have not been reported. 55 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 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 1 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 property owners. The County possesses this authority. 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. GOVERNMENTAL 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 received by the City are recognized as revenue for the current year. Delinquent taxes 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 taxes receivable in governmental funds are offset by deferred revenue. 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 Council or 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. 56 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 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 and deferred special assessments receivable in governmental funds are offset by deferred revenue. 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 estimated net realizable value. 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, equipment, and infrastructure assets (e.g., roads, sidewalks, water systems, sewer systems and similar items), are reported in the applicable governmental or business- type activities columns in the government-wide financial statements. The City defines capital assets as assets with an estimated useful life in excess of one year and an initial individual cost of more than the following: Land $1 Buildings 25,000 Equipment 5,000 Infrastructure 250,000 Capitalization Threshold 57 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Infrastructure assets acquired prior to June 30, 1980 are not recorded. 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. The City implemented GASB Statement No. 51, Accounting and Financial Reporting for Intangible Assets effective January 1, 2010 which required the City to capitalize and amortize intangible assets. Pursuant to GASB Statement No. 51, the City was required to retroactively report certain intangible assets. The City had already accounted for computer software at historical cost and therefore retroactive reporting was not necessary. 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: 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 the vested portion 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 nonvesting accumulating rights to receive sick pay benefits. Typically, resources from the compensated absences fund are used to liquidate the liability for compensated absences. 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. Buildings (and building components)10 - 50 years Equipment 3 - 15 years Infrastructure 20 - 60 years Capital Assets 58 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 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. 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 reported in the financial statements during the reporting period. Actual results could differ from such estimates. Q. COMPARATIVE DATA/RECLASSIFICATIONS Certain comparative total data for the prior year has been presented in the government-wide financial statements in order to provide an understanding of the changes in the City’s financial position and operations. Certain amounts presented in the prior year data have been reclassified in order to be consistent with the current year’s presentation. 59 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 R. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS 1. 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 between fund balance – total governmental funds and net assets – governmental activities as reported in the government-wide statement of net assets. One element of that reconciliation states, “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 ($21,654,629) difference are as follows: Accrued interest payable ($374,218) Other postemployment benefits payable (30,661) Bonds payable (21,249,750) Adjustment to fund balance - total governmental funds - to arrive at net assets of governmental activities ($21,654,629) 2. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE AND THE GOVERNMENT-WIDE STATEMENT OF ACTIVITIES The governmental fund statement of revenues, expenditures and changes in fund balance includes a reconciliation between net changes in fund balance – total governmental funds and changes in net assets of governmental activities as reported in the government-wide statement of activities. One element of that reconciliation states, “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 difference is the amount by which outlays for capital assets exceeded depreciation in the current year.” The details of this $1,610,963 difference are as follows: Total capital outlay in government fund financial statements $4,559,824 Capital asset contributed to business-type activities (234,668) Adjustments to the carrying value of real estate held for resale (687,597) Depreciation expense (2,026,596) Adjustment to net changes in fund balances - total governmental funds - to arrive at changes in net assets of governmental activities.$1,610,963 60 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Another element of that reconciliation states, “The issuance of long-term debt provides current financial resources to the governmental funds, while repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction has any effect on net assets however. This amount is the net effect of these differences in the treatment of long-term debt.” The details of this $765,736 difference are as follows: Principal repayments: General obligation bonds $722,736 Revenue bonds 43,000 Adjustment to net changes in fund balances - total governmental funds - to arrive at changes in net assets of governmental activities.$765,736 Another element of that reconciliation states, “Revenue earned in prior years, that that first becomes available in the current year is reported in the governmental funds. Whereas, this amount was reported in the statement of activities in the prior year(s) in which it was earned” The details of this ($351,036) difference are as follows: General property taxes deferred revenue: At December 31, 2009 ($403,795) At December 31, 2010 413,597 Tax increment taxes deferred revenue: At December 31, 2009 (18,306) At December 31, 2010 15,337 Special assessments deferred revenue: At December 31, 2009 (3,474,602) At December 31, 2010 3,116,733 Loans receivable deferred revenue: At December 31, 2009 (43,600) At December 31, 2010 43,600 Adjustment to net changes in fund balances - total governmental funds - to arrive at changes in net assets of governmental activities.($351,036) S. 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. 61 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Note 2 DEPOSITS AND INVESTMENTS The City maintains a cash and investment pool that is available for use by all funds of the City. Also at December 31, 2010, a portion of the total cash and investments was held in trust by a fiscal agent for debt service under the terms of the EDA 2007B series bonds. The City's total cash and investment balances as of December 31, 2010, are as follows: Carrying Amount At Fair Value Investments $26,644,734 Deposits 3,301,820 Cash on hand 8,560 (Less) fidicuiary fund cash (6,714) $29,948,400 Cash and investments $29,549,146 Cash and investments with fiscal agent399,254 $29,948,400 A. DEPOSITS In accordance with Minnesota Statutes, the City maintains deposits at those depository banks authorized by the City Council, all of which are members of the Federal Reserve System. Minnesota Statutes require that all City deposits be protected by insurance, surety bond or collateral. The market value of collateral pledged must equal 110% of the deposits not covered by insurance or bonds. Minnesota Statutes require that securities pledged as collateral be held in safekeeping by the City Clerk/Treasurer or in a financial institution other than that furnishing the collateral. Authorized collateral includes the following: (1) United States government treasury bills, treasury notes and treasury bonds; (2) Issues of United States government agencies and instrumentalities as quoted by a recognized industry quotation service available to the government entity; (3) General obligation securities of any state or local government with taxing powers which is rated “A” or better by a national bond rating service, or revenue obligation securities of any state or local government with taxing powers which is rated “AA” or better by a national bond rating service; (4) Unrated general obligation securities of a local government with taxing powers may be pledged as collateral against funds deposited by that same local government entity; (5) Irrevocable standby letters of credit issued by Federal Home Loan Banks to a municipality accompanied by written evidence that the bank’s public debt is rated “AA” or better by Moody’s Investors Service, Inc., or Standard & Poor’s Corporation; and (6) Time deposits that are fully insured by the Federal Deposit Insurance Corporation. 62 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Deposits as of December 31, 2010 are as follows: Carrying Bank Amount At BalancesFair Value Demand deposits$1,256,643$929,335 Time deposits 2,321,0002,372,485 Total $3,577,643$3,301,820 B. INVESTMENTS Minnesota Statutes Section 118A authorizes the City to invest in the following: a) 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. b) Shares of investment companies described in Section 118A.05. This includes primarily money market funds rated in the top two rating categories by a national rating service, and companies whose only investments are described in items a) through h) of this note. c) Obligations of the State of Minnesota or any of its municipalities as follows: (1) any security which is a general obligation of any state or local government with taxing powers which is rated “A” or better by a national bond rating service; (2) any security which is a revenue obligation of any state or local government with taxing powers which is rated “AA” or better by a national bond rating service; and (3) a general obligation of the Minnesota Housing Finance Agency which is a moral obligation of the State of Minnesota and is rated “A” or better by a national bond rating agency. d) Bankers acceptance of United States banks eligible for purchase by the Federal Reserve System. e) Commercial paper issued by United States corporations or their Canadian subsidiaries, of the highest quality, and maturing in 270 days or less. f) 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; certain Minnesota securities broker-dealers; or, a bank qualified as a depositor. g) General obligation temporary bonds of the same governmental entity issued under section 429.091, subdivision 7, 469.178, subdivision 5 or 475.61, subdivision 6. h) Guaranteed investment contracts with certain U.S. financial institutions carrying only high quality unsecured debt, if the City has withdrawal rights upon a decline in debt quality. 63 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Investments as of December 31, 2010, are as follows: Weighted Average CarryingPercentage MaturitiesAmount Atof Fair Value In YearsFair ValuePer Issuer Notes issued by U.S. government agencies: Federal Home Loan Bank 10.0$5,445,24120.4% Federal Home Loan Mortgage Corporation8.69,532,27135.8% Federal National Mortgage Association 9.47,480,22828.1% Money market mutual funds: Evergreen U.S. Government Fund N/A1,065,838 4.0% Western Asset Government Fund N/A2,073,787 7.8% Other issuers N/A1,047,369 3.9% Total investments 26,644,734$ 100.0% C. INVESTMENT RISKS The City's investment policy follows Minnesota State Statutes described above, which reduce the City's exposure to credit, custodial credit and interest rate risks. Additional risk information for the City is as follows: a) Interest rate risk - Interest rate risk is the risk that changes in interest rates of debt investments could adversely affect the fair value of an investment. The City's investment policy requires the City to diversify its investment portfolio to eliminate the risk of loss resulting from over concentration of assets in a specific maturity. The policy also states the City's investment portfolio will remain sufficiently liquid to enable the City to meet all operating requirements which might be reasonably anticipated. b) Credit risk - investments - Credit risk is the risk that an issuer or other counterparty to an investment will be unable to fulfill its obligation to the holder of the investment. As of December 31, 2010, the City's investments in the Notes issued by U.S. government agencies were all rated AAA by Standard & Poor's, and Aaa by Moody's Investors Service. The money market funds in which the City held shares at December 31, 2010, were not rated, but are invested in U.S. Government Obligations and/or securities guaranteed by the U.S. government, and those underlying securities are rated AAA by Standard and Poors and Aaa by Moody’s Investor Service. c) Concentration of credit risk - Concentration of credit risk is the risk of loss that may be attributed to the magnitude of a government’s investment in a single issuer. The City places no limit on the amount the City may invest in any one issuer. The table above details the percentage of the City's investments with each issuer at December 31, 2010. d) Custodial credit risk – Custodial credit risk is the risk that in the event of a failure of the counterparty, the City will not be able to recover the value of its investment securities that are in the possession of an outside party. As of December 31, 2010, investments in securities are held by the City’s three broker- dealers in the City’s name, with $500,000 of those securities at each broker-dealer insured by SIPC. Each broker-dealer has provided additional protection by providing additional insurance. This additional insurance is subject to aggregate limits applied to all of the broker-dealer’s accounts. Investments in money markets are not evidenced by securities that exist in physical or book entry form, and therefore are not subject to custodial credit risk disclosures. 64 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Note 3 RECEIVABLES Significant receivables balances not expected to be collected within one year of December 31, 2010 are as follows: Nonmajor FundsTotal 2008A TaxableCapital Other GO Housing ImpImprovementGovernmental Area Bonds FundPIR FundFunds Special assessments receivable $870,736$1,813,055 $ - $2,683,791 Loan receivable - - 43,600 43,600 Total $870,736$1,813,055 $43,600$2,727,391 Major Funds Governmental funds report deferred revenue in connection with receivables for revenues that are not considered to be available to liquidate liabilities of the current period. Governmental funds also defer revenue recognition in connection with resources that have been received, but not yet earned. At the end of the current fiscal year, the various components of deferred revenue-unavailable and deferred revenue-unearned reported in the governmental funds were as follows: UnavailableUnearned Delinquent property taxes receivable (General Fund)$397,398$ - Delinquent property taxes receivable (Nonmajor Funds)16,200 - Delinquent tax increment (Nonmajor Funds)15,337 - Delinquent special assessments (2008A GO Txbl. Hsg. Imp. Area Bonds Fund)2,286 - Delinquent special assessments (Capital Improvements - PIR Fund)121,216 - Special assessments not yet due (2008A GO Txbl. Hsg. Imp. Area Bonds Fund)916,035 - Special assessments not yet due (Capital Improvements - PIR Fund)2,077,195 - Loan receivable not yet due (Nonmajor Funds)43,600 - Contract service fees received but unearned (General Fund) - 133,116 Rental fees received in advance (Nonmajor Funds) - 39,381 Forfeitures with adjudication pending (Nonmajor Funds) - 7,046 Total deferred revenue for governmental funds $3,589,267$179,543 65 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Note 4 CAPITAL ASSETS Capital asset activity for the year ended December 31, 2010 is as follows: Beginning Ending BalanceAdditionsDeletionsBalance Governmental activities: Capital assets - not being depreciated: Land $3,625,692$1,266,089$ - $4,891,781 Construction in progress 13,059,2113,448,117(12,824,259)3,683,069 Total capital assets not being depreciated 16,684,9034,714,206(12,824,259)8,574,850 Capital assets - being depreciated: Buildings 16,925,14710,460,127 - 27,385,274 Equipment 6,496,0421,287,484 - 7,783,526 Infrastructure 25,435,996 - - 25,435,996 Total capital assets being depreciated 48,857,18511,747,611 060,604,796 Less accumulated depreciation for: Buildings 9,289,897674,806 - 9,964,703 Equipment 4,384,817522,632 - 4,907,449 Infrastructure 10,489,512878,398 - 11,367,910 Total accumulated depreciation 24,164,2262,075,836 026,240,062 Capital assets being depreciated - net 24,692,9599,671,775 034,364,734 Governmental activities capital assets - net 41,377,86214,385,981(12,824,259)42,939,584 Business-type activities: Capital assets - not being depreciated: Land 2,343,247 - - 2,343,247 Construction in progress 103,820671,049(471,361)303,508 Total capital assets not being depreciated 2,447,067671,049(471,361)2,646,755 Capital assets - being depreciated: Buildings 4,581,314 - - 4,581,314 Equipment 2,031,792 - - 2,031,792 Infrastructure 13,909,245471,361 - 14,380,606 Total capital assets being depreciated 20,522,351471,361 020,993,712 Less accumulated depreciation for: Buildings 836,860133,372 - 970,232 Equipment 1,225,924137,256 - 1,363,180 Infrastructure 6,424,356360,138 - 6,784,494 Total accumulated depreciation 8,487,140630,766 09,117,906 Capital assets being depreciated - net 12,035,211(159,405)011,875,806 Business-type activities capital assets - net 14,482,278511,644(471,361)14,522,561 Total capital assets - net $55,860,140$14,897,625($13,295,620)$57,462,145 66 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Depreciation expense was charged to functions/programs of the primary government – governmental activities as follows: Governmental activities: General government $50,281 Public safety 517,536 Public works 1,062,093 Culture and recreation 276,699 Community development 119,987 Depreciation on capital assets held by governmental internal service activities is charged to each function based on use: Central garage 49,240 Total depreciation expense - capital assets held by governmental activities $2,075,836 Depreciation expense was charged to functions/programs of the primary government - business-type activities as follows: Business-type activities: Water $209,889 Sewer 177,083 Refuse 300 Storm sewer 74,330 Liquor 147,844 Depreciation on capital assets held by business-type internal service activities is charged to each function based on use: Information systems 21,320 Total depreciation expense - capital assets held by business-type activities $630,766 67 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Note 5 INTERFUND RECEIVABLES, PAYABLES , CAPITAL LEASES AND TRANSFERS INTERFUND RECEIVABLES, PAYABLES Individual fund interfund receivable and payable balances at December 31, 2010 are as follows: Fund ReceivablePayable Major Funds: General Fund $784,867$ - Municipal State Aid Street - 599,685 Water 18,947 - Sewer 111,289 - Liquor - 102,816 Nonmajor funds 21,737234,339 Total $936,840$936,840 $18,947 of these interfund balances are for services provided in 2010 and reimbursed in 2011. All other interfund balances at December 31, 2010, reflect lending arrangements to cover deficit cash balances at year end. Substantially all amounts are expected to be repaid within one year. INTERFUND TRANSFERS Interfund transfers during the year ended December 31, 2010 are as follows: CapitalCapital EqpCapitalCapitalOther Imprvmts GenReplacementImprvmtsImprvmtsGovtlInternal GeneralGovt BldgGen GovtPIRDevelopmentFundsServiceTotal Transfers out: Major funds: Governmental: General $ - $22,786$50,000$ - $ - $100,000$35,000$207,786 2008 Tx GO Hsg Imp Area Bonds37,500 - - - - 37,500 - 75,000 Municipal State Aid Street - - - - - 121,000 - 121,000 Capital Imprvmts Gen Govt Bldg - - - - - 612,262 - 612,262 Capital Imprvmts PIR - - - - - 1,274,507 - 1,274,507 Capital Imprvmts Development - - - 150,000 - - - 150,000 Enterprise: Water 86,568 - - - - - 35,000121,568 Sewer 86,566 - - 2,482 - - 35,000124,048 Refuse 70,472 - - - - - 35,000105,472 Storm Sewer - - - - - - - - Liquor 46,624 - - - - 59,00035,000140,624 Nonmajor funds: Other governmental funds 371,770666,974 - 209,7981,004,770303,68165,7902,622,783 Internal service funds - 36,250 - - - - 25,00061,250 Total $699,500$726,010$50,000$362,280$1,004,770$2,507,950$265,790$5,616,300 Governmental Transfers In Major Funds Nonmajor Funds 68 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Transfers Out Transfers In AmountPurpose Community Development General Fund $12,666Admin labor allocation Economic Dev Authority AdminstrationGeneral Fund 12,666Admin labor allocation Library General Fund 11,914Admin labor allocation Cable Television General Fund 21,668Admin labor allocation Liquor General Fund 46,624Admin labor allocation Water General Fund 86,568Admin labor allocation Sewer General Fund 86,566Admin labor allocation Refuse General Fund 35,236Admin labor allocation Refuse General Fund 35,236Admin labor allocation 2008 Taxable GO Housing Imp Area BondsGeneral Fund 37,500Fund project costs Cable Television General Fund 16,210Fund transferred staff position Police Community Programs General Fund 36,370Transfer program to General Fund Downtown Parking Maintenance General Fund 135,276Transfer program to General Fund Community Center Capital Building General Fund 125,000Supplement for unalloted state aid 2008 Taxable GO Housing Imp Area BondsEconomic Dev Authority Admin 37,500Fund project costs Liquor Police Community Programs 9,000Fund DARE program Capital Improvement PIR GO Improv/Rev Bonds 2006A 501,180Debt service Municipal State Aid Street GO Improv/Rev Bonds 2006A 121,000Debt service Capital Improvement PIR GO Public Facilities Bonds 2009A 142,538Debt service Huset Park Area TIF Econ Dev Auth TIF Rev Bonds 2007178,000Debt service Capital Improvement PIR GO Improv/Re Bonds 2003A 630,789Debt service Capital Imp General Govt Buildings EDA Housing Maintenance 600,000Fund redevelopment Capital Improvement PVVS Capital Imp General Govt Buildings 30,955Fund building improvements General Fund Capital Imp General Govt Buildings 22,786Fund building improvements Central Garage Capital Imp General Govt Buildings 36,250Fund building improvements Community Center Capital Building Capital Imp General Govt Buildings636,019Fund building improvements General Fund Capital Improvement Parks 50,000Fund park improvements Sewer Capital Improvement PIR 2,482Fund project costs Capital Improvement Development Capital Improvement PIR 150,000Fund delinquent assessment GO Improvement Bonds 1999A Capital Improvement PIR 209,798Close fund EDA Housing Maintenance Capital Improvement Development 218,238Fund redevelopment Economic Dev Authority AdminstrationCapital Improvement Development 51,000Fund redevelopment Capital Sheffield Redevelopment Capital Improvement Development 735,532Fund redevelopment General Fund Infrastructure Replacement 50,000Fund infrastructure improvements Liquor Infrastructure Replacement 50,000Fund infrastructure improvements Capital Improvement Infrastructure Replacement 80,489Fund infrastructure improvements General Fund Capital Equip Replacmt Gen Govt 50,000Fund equipment replacement Contributions - Other Capital Building Library 43,242Meet minimum fund balance policy Capital Imp General Govt Buildings Capital Building Library 12,262Meet minimum fund balance policy Special Projects Central Garage 42,000Fund vacancy General Fund Information Systems 35,000Fund information systems Cable Television Information Systems 18,790Fund information systems Liquor Information Systems 35,000Fund information systems Sewer Information Systems 35,000Fund information systems Water Information Systems 35,000Fund information systems Central Garage Information Systems 25,000Fund information systems Refuse Information Systems 35,000Fund information systems Library Information Systems 5,000Fund information systems Library Contributions - Other 1,950City match of contribution $5,616,300 69 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Note 6 LONG-TERM DEBT GENERAL OBLIGATION BONDS The City issues General Obligation Bonds to provide funds for the acquisition and construction of major capital improvements. General Obligation Bonds are direct obligations and are backed by the full faith and credit of the City. Any deficiencies in pledged revenues will be offset by general property taxes. All of the bonds are serial bonds, which require semiannual payments of principal and/or interest from the date the bonds are issued. 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. General obligation bonds outstanding at December 31, 2010, are as follows: Pledged revenue, if any, in addition toOriginal InterestIssueFinal Balance general property taxesIssueRateDateMaturityEnd of Year Governmental activities: GO Street rehabilitation series 2007A None $1,000,0004.00-4.375%9/19/20072/1/2018 $850,000 GO Public safety center series 2008B None 10,000,0004.30-4.55%8/6/20082/1/203810,000,000 GO Public facilities series 2009A None 3,005,0002.00-4.75%7/1/20092/1/20383,005,000 Taxable GO tax increment bonds series 2009B Tax increment 580,0003.40-5.10%7/1/20092/1/2021 580,000 GO Improvement series 2003A Special assessments1,332,8291.10-4.00%6/1/20032/1/2018 720,238 GO Improvement series 2006A Special assessments2,759,5504.00%12/7/20062/1/20201,756,512 Taxable GO housing imprvmt area series 2008ASpecial assessments975,0005.00-6.05%7/16/20082/1/2024 935,000 GO Public Facilities series 2009A Special assessments605,0002.00-4.75%7/1/20092/1/2019 565,000 Business-type activities: GO Improvement series 2003A Utility revenues222,1721.10-4.00%6/1/20032/1/2018 193,189 GO Utility revenue series 2003A Utility revenues1,045,0001.10-4.00%6/1/20032/1/2018 491,573 GO Improvement series 2006A Utility revenues645,4504.00%12/7/20062/1/2017 613,486 GO Utility revenue series 2006A Utility revenues670,0004.00%12/7/20062/1/2017 505,000 GO Public Facilities series 2009A Utility revenues325,0002.00-4.75%7/1/20092/1/2019 325,000 Total general obligation bonds outstanding $20,539,998 70 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 As of December 31, 2010, the annual debt service requirements to maturity for general obligation bonds are as follows: Fiscal Year Ending December 31PrincipalInterestPrincipalInterest 2011 $985,620$769,859$229,380$75,604 2012 1,016,397732,507273,60166,810 2013 979,899695,043285,10156,801 2014 981,083657,380303,91745,894 2015 776,583622,740278,41734,879 2016 814,313590,850280,68724,204 2017 843,146556,723311,85412,707 2018 814,709521,400125,291 4,106 2019 585,000490,62940,000 800 2020 575,000464,474 - - 2021-20252,615,0001,946,618 - - 2026-20302,320,0001,424,506 - - 2031-20352,955,000840,506 - - 2036-20382,150,000151,274 - - Total$18,411,750$10,464,509$2,128,248$321,805 Governmental Activities Business-Type Activities REVENUE BONDS The City issues revenue bonds for which the City pledges only the income derived from the acquired or constructed assets or redevelopment to pay the debt service. All of the bonds are serial bonds, which require semiannual payments of principal and/or interest from the date the bonds are issued. There are a number of limitations and restrictions contained in the bond indentures. The City is in compliance with all significant limitations and restrictions. Revenue bonds outstanding at December 31, 2010 are as follows: Original InterestIssueFinal Balance Pledged revenueIssueRateDateMaturityEnd of Year Governmental activities: Tax increment revenue series 2007 Tax increment$2,890,0005.00-5.375%8/3/20072/15/2032$2,838,000 Business-type activities: Public facility lease revenue series 2007B Liquor revenues5,040,0004.50-5.00%9/19/20072/1/20304,900,000 Total revenue bonds outstanding $7,738,000 71 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 As of December 31, 2010, the annual debt service requirements to maturity for revenue bonds are as follows: Fiscal Year Ending December 31PrincipalInterestPrincipalInterest 2011 $48,000$148,788$150,000$230,630 2012 53,000146,263155,000223,768 2013 58,000143,488165,000216,568 2014 62,000140,488170,000209,030 2015 68,000137,238180,000201,155 2016 74,000133,688185,000192,942 2017 80,000129,838195,000184,393 2018 87,000125,576205,000175,239 2019 94,000120,870215,000165,474 2020 102,000115,774230,000155,128 2021-2025636,000486,6751,330,000595,453 2026-2030900,000282,2941,720,000223,105 2031-2032576,00034,722 - - Total$2,838,000$2,145,702$4,900,000$2,772,885 Governmental Activities Business-Type Activities PLEDGED REVENUES Refer to the schedules above for the terms of bonds with pledged revenues. Additional information on pledged revenues by type, as of December 31, 2010, and for the the year then ended, is as follows: Related BondAs PercentageRelated Bond Pledged ActivityPrincipalof RevenuePrincipalPledged Revenue Financedand InterestPledgedand InterestRevenue Project-specific Street special assessmentsimprovements$3,186,643 95%$532,141$557,057 Project-specific Private special assessmentsredevelopment 1,367,018 95%93,995108,488 Project-specific Public/Private tax increment redevelopment 5,748,982 83%222,213426,401 Water, sewer and storm-Utility system sewer net revenuesimprovements 2,450,054 64%500,793786,572 Annual appropriationMunicipal store of liquor net revenuesconstruction 7,672,885 100%377,155354,712 Total Remaining Current Year 72 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 CHANGES IN LONG-TERM LIABILITIES Long-term liability activity for the year ended December 31, 2010, is as follows: Beginning EndingDue Within BalanceAdditionsReductionsBalanceOne Year Governmental activities: Bonds payable: General obligation bonds repaid only with general taxes$13,940,000$ - ($85,000)$13,855,000$375,000 General obligation bonds with other pledged revenues 5,194,486 - (637,736)4,556,750610,620 Revenue bonds 2,881,000 - (43,000)2,838,00048,000 Total bonds payable 22,015,486 - (765,736)21,249,7501,033,620 Compensated absences 763,636685,734(582,647)866,723114,147 Postemployment benefits other than pensions 20,14126,152(15,632)30,661 - Total governmental activity long-term liabilities$22,799,263$711,886($1,364,015)$22,147,134$1,147,767 Business-type activities: Bonds payable: General obligation bonds with other pledged revenues$2,540,512$ - ($412,264)$2,128,248$229,380 Revenue bonds 5,040,000 - (140,000)4,900,000150,000 Total bonds payable 7,580,512 - (552,264)7,028,248379,380 Compensated absences 123,411145,088(131,351)137,14818,062 Total business-type activity long-term liabilities $7,703,923$145,088($683,615)$7,165,396$397,442 For governmental activities, compensated absences are generally liquidated by the compensated absences fund, an internal service fund. Note 7 CONDUIT DEBT From time to time, the City 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. The City, the EDA, and the HRA, are not 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, 2010, there were Revenue Bonds of this type outstanding with an estimated aggregate principal amount payable of approximately $21,725,000. 73 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Note 8 FUND EQUITY The following fund had a fund deficit as of December 31, 2010. The City will finance this deficit through internal sources in future years: Nonmajor Funds: Debt Service Funds: Sheffield TIF Redevelopment (59,218) ($59,218) At December 31, 2010, 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: MajorNonmajor FundsFundsTotals General Fund: Reserved for prepayments $77,204$ - $77,204 Designated for working capital 4,609,943 - 4,609,943 Designated for program expenditures 171,646 - 171,646 Special Revenue Funds: Reserved for prepayments - 3,046 3,046 Reserved for real estate held for resale - 152,427152,427 Designated for working capital - 136,487136,487 Designated for program expenditures - 2,692,3052,692,305 Debt Service Funds: Reserved for real estate held for resale - 776,443776,443 Designated for debt service 163,7383,609,2543,772,992 Capital Projects Funds: Reserved for real estate held for resale 224,682393,473618,155 Designated for capital expenditures 9,849,8521,792,55511,642,407 $15,097,065$9,555,990$24,653,055 74 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Note 9 DEFINED BENEFIT PENSION PLANS - STATEWIDE A. PLAN DESCRIPTION All full-time and certain part-time employees of the City are covered by defined benefit plans administered by the Public Employees Retirement Association of Minnesota (PERA). PERA administers the General Employees Retirement Fund (GERF) and the Public Employees Police and Fire Fund (PEPFF). These are cost-sharing, multiple-employer retirement plans. These plans are established and administered in accordance with Minnesota Statute, Chapters 353 and 356. GERF 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. The City has no current employees that are Basic Plan members. All new members must participate in the Coordinated Plan. All police officers and firefighters 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. For all PEPFF and GERF members that began service prior to July 1, 1989, a full annuity is available when age plus years of service equal 90. For these members, benefits are calculated using the greater of the step rate or level rate formulas. Only the level rate formula applies to members that began service after June 30, 1989. A reduced retirement annuity is 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 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. Vested, terminated employees who are entitled to benefits but are not receiving them yet are bound by the provisions in effect at the time they last terminated their public service. PERA issues a publicly available financial report that includes financial statements and required supplementary information for GERF 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. 75 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 B. FUNDING POLICY Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. These statutes are established and amended by the state legislature. The City makes annual contributions to the pension plans equal to the amount required by state statutes. GERF Coordinated Plan members are required to contribute 6.0% of their annual covered salary in 2010. The PEPFF members are required to contribute 9.4% of their annual covered salary in 2010. The City is required to contribute the following percentages of annual covered payroll: 7.0% for Coordinated Plan GERF members, and 14.1% for PEPFF members. Employer contribution rates for the Coordinated Plan GERF members will increase to 7.25% and rates for the PEPFF members will increase to 14.4% effective January 1, 2011. 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,GERFPEPFF 2008 $307,183$306,489 2009 319,601369,627 2010 343,485387,431 Note 10 DEFINED CONTRIBUTION PLAN A. FIRE RELIEF ASSOCIATION, PAID ON-CALL DIVISION The Columbia Heights Fire Department Relief Association is the administrator of a single-employer pension plan for the paid on-call 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. All provisions are within limitations established by Minnesota statutes. Type of Benefit. The exclusive pension provided by the Association is a "Defined Contribution Lump Sum Service Pension" as defined in Minnesota Statutes §424A.02, Subdivision 4. Contributions Required and Contributions Made. No contributions are required from the plan members or the City. The plan is funded through state aid, investment income and discretionary contributions from the City. For 2010, state aid was contributed to the plan. This state aid revenue and the related contribution expense/expenditure of $66,739 are recognized in the accompanying financial statements for the year ended December 31, 2010. 76 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 B. COUNCIL MEMBERS Certain council members of the City are covered by the Public Employees Defined Contribution Plan (PEDCP), a multiple-employer deferred compensation plan administered by the Public Employees Retirement Association of Minnesota (PERA). The PEDCP is a tax qualified plan under section 401(a) of the Internal Revenue Code and all contributions by or on behalf of the employees are tax deferred until time of withdrawal. Plan benefits depend solely on amounts contributed to the plan plus investment earnings, less administrative expenses. Minnesota Statutes, Chapter 353D.03, specifies plan provisions, including the employee and employer contribution rates for those qualified personnel who elect to participate. An eligible elected official who decides to participate contributes 5% of salary, which is matched by the elected official’s employer. In 2010, plan members contributed $2,250 and the City contributed $2,250. Note 11 POST EMPLOYMENT BENEFITS OTHER THAN PENSIONS (OPEB) A. PLAN DESCRIPTION The City administers a single-employer defined benefit health care plan (the plan.) By state statute, the plan provides an implicit rate subsidy for retired participants by allowing retirees under age 65 to purchase health insurance at the premium rate available to active employees. In addition, by state statute, the plan provides payment of insurance premiums, up to age 65, for public safety employees that retire with a qualifying disability, equal to the current employer-paid portion of premiums for an active employee. The employer-paid portion of premiums for an active employee is determined periodically by negotiation between the City and collective bargaining units of city employees. The plan does not issue a publicly available financial report. B. FUNDING POLICY Participants under the implicit rate subsidy provision are required to contribute 100% of the stated premium billed by the insurer. For 2010, participants under disabled public safety retiree provision were required to contribute $0 for single coverage or a portion of the stated premium billed by the insurer for family coverage. Total 2010 participant contributions were $55,909. Under both provisions of the plan, the City is only required to contribute on a pay-as-go basis. This amount is listed below for the current year. The State of Minnesota, solely at its option, reimburses the City annually for a portion of the City’s costs under the disabled public safety retiree provision. Historically, these reimbursements have approximated 60% of the pay-as-go cost of this plan provision. These reimbursements are reported as revenue in the year received, separate from OPEB expenses/expenditures. 77 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 C. ANNUAL OPEB COST AND NET OPEB OBLIGATION The City’s annual OPEB cost is calculated based on the annual required contribution (ARC) determined by periodic actuarial studies. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover the normal cost each year and to amortize the unfunded actuarial liability over a period not to exceed thirty years. The components of the City’s OPEB cost for the current year and the changes in the City’s net OPEB obligation to the plan are as follows: Year Ended December 31, 2010 Annual required contribution$26,267 Interest on net OPEB obligation604 Adjustment to annual required contribution(719) Annual OPEB cost 26,152 Contributions made by City (15,632) Increase in net OPEB obligation 10,520 Net OPEB obligation-beginning of year 20,141 Net OPEB obligation-end of year $30,661 Comparative OPEB information for the curent and two prior years includes the following: Percentage of Year EndedAnnual OPEBAnnual OPEBNet OPEB December 31CostCost ContributedObligation 2008 $25,548 55%$11,427 2009 25,891 66%21,141 2010 26,152 60%30,661 D. FUNDED STATUS AND FUNDING PROGRESS As of December 31, 2008 (the first and most recent year for which a valuation was required) , the actuarial accrued liability for benefits was $257,138; all of which was unfunded. Under the actuarial cost method used, this actuarial accrued liability is not a function of the annual payroll of active employees covered by the plan (the covered payroll). Actuarial valuations involve estimates of the value of reported amounts and assumptions about the probability of events far into the future. Actuarially determined amounts are subject to continual revision as actual results are compared to past expectations and new estimates are made about the future. The schedule of funding progress, presented as required supplementary information following the notes to the financial statements, presents multi-year trend information, beginning in 2008, about the whether the actuarial value of plan assets is increasing or decreasing over time, relative to the actuarial accrued liability for benefits. 78 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 E. METHODS AND ASSUMPTIONS The projection of benefits for financial reporting purposes is based on the type of benefits provided by the substantive plan at each valuation date and the historical pattern of sharing benefit costs between the City and the participants to that point. The methods used include techniques designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. The following methods and simplifying assumptions were used: Actuarial cost method – Projected unit credit Actuarial asset valuation method – Not applicable Amortization of UAAL – Level dollar method over a thirty year closed period Healthcare cost trend rate – 9% initially, declining to 5% after five years Inflation rate assumed – less than 5% annual Investment return assumed – 3% annual Retirement age assumed - Public safety employees age 52, all others age 62 Turnover rate – based on actual experience for City for the years 2004-2008 Mortality – Life expectancies were based on the 2000 Retired Pensioners Mortality Rates for Male and Female Note 12 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 the actual worker wage base is known and paid. 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 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. 79 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 B. LITIGATION 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 or development agreements; 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 for construction projects that are in process at yearend. At December 31, 2010, the City’s obligation for such projects was approximately $482,000. Additionally, under the terms of various tax increment financing agreements, the City has commitments to reimburse developers for certain qualifying redevelopment costs plus interest. These future reimbursements are limited however, to the future tax increment received from certain tax increment districts. The amount to be paid under these agreements is not determinable at this time. The following table summarizes the current year activity and contingent portions of these commitments: TIFDistrict ExpendituresInterestExpendituresInterest District EndsDeveloperReimbursedPaid AvailableAvailable R82027Crestview ONDC1$ - $32,164$732,801$206,099 R82027Col Hts Tran Block - 16,654 175,089 16,879 K22019Barnick 1,880 - 43,896 - K22019Miske 1,63021,797 72,635 - T62031BNC Bank - 66,880 6,650,000 1,314,691 Current Year Contingent on Future Tax Increment 80 CITY OF COLUMBIA HEIGHTS, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2010 Note 13 ECONOMIC DEPENDENCY The City water utility purchases all of its water from a single supplier, the City of Minneapolis. The current contract with this supplier ends May 31, 2034. The contract provides for annual rate adjustments, stated as a percentage of the rate the City of Minneapolis charges its in-city customers. At present, the City of Columbia Heights has no alternate source of water supply. Note 14 RECENTLY ISSUED ACCOUNTING STANDARDS For the year ended December 31, 2010, the City implemented the following statements issued by the Governmental Accounting Standards Boards (GASB), which did not have a material effect on the accompanying financial statements: Statement No. 51 Accounting and Financial Reporting for Intangible Assets. The provisions of this Statement are effective for fiscal periods beginning after June 15, 2009. Statement No. 53 Accounting and Financial Reporting for Derivative Instruments. The provisions of this Statement are effective for fiscal periods beginning after June 15, 2009. Statement No. 58 Accounting and Financial Reporting for Chapter 9 Bankruptcies. The provisions of this Statement are effective for fiscal periods beginning after June 15, 2009. The Governmental Accounting Standards Boards (GASB) recently approved the following statements, which were not implemented for the accompanying financial statements for the year ended December 31, 2010. The effect these standards may have on future financial statements is not determinable at this time: Statement No. 54 Fund Balance Reporting and Governmental Fund Type Definitions. The provisions of this Statement are effective for fiscal periods beginning after June 10, 2010. Statement No. 57 OPEB Measurements by Agent Employers and Agent Multiple-Employer Plans. The provisions of this Statement are effective for fiscal periods beginning after June 15, 2011. Statement No. 59 Financial Instruments Omnibus. The provisions of this Statement are effective for fiscal periods beginning after June 10, 2010. Statement No. 60 Accounting and Financial Reporting For Service Concession Arrangements. The provisions of this Statement are effective for fiscal periods beginning after December 15, 2011. Statement No. 61 The Financial Reporting Entity: Omnibus. The provisions of this Statement are effective for fiscal periods beginning after June 15, 2012. Statement No. 62 Codification of Accounting and Financial Reporting Guidance Contained in Pre- November 30, 1989 FASB and AICPA Pronouncements. The provisions of this Statement are effective for fiscal periods beginning after December 15, 2011. 81 - This page intentionally left blank - 82 REQUIRED SUPPLEMENTARY INFORMATION 83 CITY OF COLUMBIA HEIGHTS, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION Statement 10 BUDGETARY COMPARISON SCHEDULE - GENERAL FUND Page 1 of 2 For The Year Ended December 31, 2010 With Comparative Actual Amounts For The Year Ended December 31, 2009 Variance with Budgeted Amounts Final Budget2009 ActualPositive Actual OriginalFinalAmounts(Negative)Amounts Revenues: Taxes $7,229,778$6,694,153$6,770,957$76,804$6,590,306 Licenses and permits 193,200193,200179,883(13,317)179,586 Intergovernmental: Market value homestead credit - 535,625171,455(364,170)452,948 All other 912,303929,5511,485,825556,2741,460,666 Charges for services 585,050614,848587,971(26,877)530,461 Fines and forfeitures 131,000131,000159,83628,836125,595 Investment income: Interest and dividends 100,000100,000122,14722,147123,548 Change in fair value 16,95816,958(26,141)(43,099)(35,602) Other revenues 11,00011,00015,4354,4357,143 Total revenues 9,179,289 9,226,335 9,467,368 241,033 9,434,651 Expenditures: General government: Council 145,767145,767131,92413,843132,261 2010 Council 145,767 145,767 131,924 13,843 132,261 Manager 414,148414,148402,19011,958380,775 Clerk 177,213177,213108,81568,39847,609 Legal 186,716186,716167,54019,176167,809 Finance 714,600714,600708,7415,859625,073 Assessing 121,940121,940116,1635,777115,334 General government buildings 159,212159,212138,73120,481110,833 Total general government 1,919,596 1,919,596 1,774,104 145,492 1,579,694 Public safety: Police and animal control 3,512,0083,557,5973,557,916 (319)3,208,481 Fire and emergency management1,316,3871,317,8451,250,79767,0481,124,406 Total public safety 4,828,395 4,875,442 4,808,713 66,729 4,332,887 Public works: Engineering 336,590336,590335,1711,419329,765 Maintenance 1,027,9701,027,970972,08655,884920,959 Sanitation 124,010124,010101,69022,32075,536 Total public works 1,488,570 1,488,570 1,408,947 79,623 1,326,260 Other Departments: Parks and recreation 1,624,4761,624,4761,411,042213,4341,326,657 Contingencies 50,00050,00010,18839,8129,865 Total recreation 1,674,476 1,674,476 1,421,230 253,246 1,336,522 Total expenditures 9,911,037 9,958,084 9,412,994 545,090 8,575,363 Revenues over (under) expenditures (731,748)(731,749)54,374786,123859,288 84 CITY OF COLUMBIA HEIGHTS, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION Statement 10 BUDGETARY COMPARISON SCHEDULE - GENERAL FUND Page 2 of 2 For The Year Ended December 31, 2010 With Comparative Actual Amounts For The Year Ended December 31, 2009 Variance with Budgeted Amounts Final Budget2009 ActualPositive Actual OriginalFinalAmounts(Negative)Amounts Other financing sources (uses): Sale of capital assets $1,000$1,000$ - ($1,000)$ - Transfers in 490,355490,355699,500209,145371,241 Transfers out (207,786)(207,786)(207,786) - (190,335) Total other financing sources (uses)283,569 283,569 491,714 208,145 180,906 Net change in fund balance ($448,179)($448,180)546,088$994,268 1,040,194 Fund balance - January 1 4,796,151 3,755,957 Fund balance - December 31 $5,342,239 $4,796,151 2010 85 CITY OF COLUMBIA HEIGHTS, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION Statement 11 SCHEDULE OF FUNDING PROGRESS FOR THE RETIREE HEALTH PLAN For The Year Ended December 31, 2010 Actuarial Accrued UAAL as a ActuarialActuarialLiability (AAL)Unfunded Percentage ValuationValue of - ProjectedAAL Funded Coveredof Covered Date AssetsUnit Credit(UAAL)Ratio Payroll Payroll 1/1/2008$ - $257,138 $257,1380%N/A N/A 86 CITY OF COLUMBIA HEIGHTS, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE NOTE TO RSI December 31, 2010 Note A BUDGETS The legal level of budgetary control is at the fund level. The General Fund and the following Special Revenue Fund budgets are legally adopted on a basis consistent with accounting principles generally accepted in the United States of America: • Nonmajor special revenue funds: Cable television fund Police community programs fund Library fund Community development fund Economic Development Authority (component unit): Economic Development Authority administration fund Housing and Redevelopment Authority (component unit): Parkview villa north fund Parkview villa south fund 87 - This page intentionally left blank - 88 COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES 89 NONMAJOR GOVERNMENTAL FUNDS 90 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 (other than debt of the proprietary funds.) 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.) 91 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMBINING BALANCE SHEET Statement 12 NONMAJOR GOVERNMENTAL FUNDS December 31, 2010 Total Nonmajor Special DebtCapital Governmental Assets RevenueServiceProjectFunds Cash and investments $3,313,925$3,700,537$1,858,278$8,872,740 Receivables: Accounts 46,372 - - 46,372 Taxes 19,61136,725 - 56,336 Interest 10,900 7,600 5,50024,000 Loans 43,600 - - 43,600 Due from other governmental units 149,256 - - 149,256 Interfund receivable 21,737 - - 21,737 Prepayments 3,046 - - 3,046 Real estate held for resale 152,427776,443393,4731,322,343 Total assets $3,760,874$4,521,305$2,257,251$10,539,430 Liabilities and Fund Balance Liabilities: Accountspayable $126,837 $38,513 $69,842 $235,192Accounts payable $126,837 $38,513 $69,842 $235,192 Accrued salaries and withholdings payable 18,676 - - 18,676 Contracts payable - retained percentage - - 1,381 1,381 Due to other governmental units 35,152 7,950 - 43,102 Interfund payable 101,314133,026 - 234,340 Deferred revenue 106,22715,337 - 121,564 Deposits 26,577 - - 26,577 Total liabilities 414,783194,82671,223680,832 Fund balance: Reserved for: Prepayments 3,046 - - 3,046 Real estate held for resale 152,427776,443393,4731,322,343 Unreserved: Designated for working capital 136,487 - - 136,487 Designated for maintenance 2,692,305 - - 2,692,305 Designated for debt service - 3,609,254 - 3,609,254 Designated for capital expenditures - - 1,792,5551,792,555 Undesignated 361,826(59,218) - 302,608 Total fund balance 3,346,0914,326,4792,186,0289,858,598 Total liabilities and fund balance $3,760,874$4,521,305$2,257,251$10,539,430 92 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE Statement 13 NONMAJOR GOVERNMENTAL FUNDS For The Year Ended December 31, 2010 Total Nonmajor Special Debt CapitalGovernmental RevenueService Project Funds Revenues: Taxes $1,062,935$981,808$ - $2,044,743 Tax increment collections - 815,935 - 815,935 Licenses and permits 299,265 - - 299,265 Intergovernmental 731,586 74,798 35,490841,874 Charges for services 935,796 - 17,560953,356 Fines and forfeitures 28,857 - - 28,857 Investment income: Interest and dividends 59,300 45,805 59,601164,706 Change in fair value (14,400)(11,100)(14,400)(39,900) Other revenues 62,172 - 194,917257,089 Total revenues 3,165,511 1,907,246 293,168 5,365,925 Expenditures: Current: General government 73,452 - 69,842143,294 Public safety 37,062 - 10,077 47,139 Public works - - 14,412 14,412 Cultureandrecreation 779794 1504 781298Culture and recreation 779,794 - 1,504 781,298 Community development 1,177,572 28,218126,1241,331,914 Capital outlay: Public works - - 111,424111,424 Community development 296,588643,224 19,440959,252 Debt service: Principal retirement - 725,736 - 725,736 Interest and fiscal charges - 926,465 - 926,465 Developer incentives - 141,005 - 141,005 Total expenditures 2,364,468 2,464,648 352,823 5,181,939 Revenues over (under) expenditures 801,043 (557,402)(59,655)183,986 Other financing sources (uses): Transfers in 48,4501,573,507885,9932,507,950 Transfers out (273,476)(387,798)(1,961,509)(2,622,783) Total other financing sources (uses)(225,026)1,185,709 (1,075,516)(114,833) Net change in fund balance 576,017 628,307 (1,135,171)69,153 Fund balance - January 1 2,770,0743,698,1723,321,1999,789,445 Fund balance - December 31 $3,346,091$4,326,479$2,186,028$9,858,598 93 - This page intentionally left blank - 94 NONMAJOR SPECIAL REVENUE FUNDS The City of Columbia Heights had the following Nonmajor Special Revenue Funds during the year: Cable Television Fund 225 – established to account for revenues and expenditures associated with the cable television franchise. Police Forfeiture Fund 265 – established to account for forfeited cash and property received by the police department. Police Community Programs Fund 270 – established to account for revenues and expenditures of various police activities, including the DARE (Drug Abuse Resistance Education) program, police reserve officers and other activities. Police Grants Fund 272 – established to account for revenues and expenditures of various grants for police activities. Library Fund 240 – established in 1993 to account for revenues and expenditures of the library. After School Programs Fund 261 – established to account for revenues and expenditures associated with various youth enrichment activities conducted by the recreation department and the library, under agreements with Independent School District 13. Contributed Projects – Recreation Fund 881 – established to monitor contributions for recreational activities and related expenditures. Contributed Projects – Other Fund 883 – established to monitor contributions and related expenditures for activities other than recreation. Special Projects Fund 226 – established to monitor revenues from special projects and related expenditures. Community Development Fund 201 – established to account for revenues and expenditures associated with planning, building inspections, and community development projects within the City. Anoka County Comm Dev Programs Fund 202 – established to account for revenues and expenditures of community development programs funded by or passed through Anoka County to the City. 95 - This page intentionally left blank - 96 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 to foster economic development in the City. Economic Development Authority Administration Fund 204 – established to account for revenues and expenditures of all EDA activity not accounted for in other EDA funds. 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 operate a senior housing complex. Parkview Villa North Fund 203 – established to account for the revenues and expenditures of the low-income, federally subsidized portion of a senior housing complex. Parkview Villa South Fund 213 – established to account for the revenues and expenditures of the market-rate, non-federal portion of a senior housing complex. 97 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS December 31, 2010 Cable Television Fund 225 Police Forfeiture Fund 265 Police Community Programs Fund 270 Police Grants Fund 272 Library Fund 240 Assets Cash and investments $289,406$21,250$182$ - $161,556 Receivables: Accounts 43,642 - - - - Taxes - - - - - Interest 1,100 - - - 800 Loans - - - - - Due from other governmental units - - - 14,373 - Interfund receivable - - - - - Prepayments - - - - 3,046 Real estate held for resale - - - - - Total assets $334,148 $21,250 $182 $14,373 $165,402 Liabilities and Fund Balance Liabilities: Accountspayable $247 $-$182 $399 $12,542 Accounts payable $247 $ - $182 $399 $12,542 Accrued salaries and withholdings payable 7 - - - 9,862 Due to other governmental units - - - - 3,465 Interfund payable - - - 13,974 - Deferred revenue - 7,046 - - - Deposits - - - - - Total liabilities 2547,046 18214,37325,869 Fund balance: Reserved for prepayments - - - - 3,046 Reserved for real estate held for resale - - - - - Unreserved: Designated for working capital - - - - 136,487 Designated for maintenance 333,894 - - - - Undesignated - 14,204 - - - Total fund balance 333,89414,204 0 0139,533 Total liabilities and fund balance $334,148 $21,250 $182 $14,373 $165,402 98 Statement 14 After-School Programs Fund 261 Contributed Projects - Recreation - Fund 881 Contributed Projects - Other - Fund 883 Special Projects Fund 226 Community Development Fund 201 Anoka County Comm Dev Programs Fund 202 EDA Admin Fund 204 (Component Unit) HRA Funds (Component Unit) Total Nonmajor Special Revenue Funds $140,001$120,002$230,756$267,830$249,295$ - $170,695$1,662,952$3,313,925 - - - - 470 - - 2,26046,372 - - - - - - 19,611 - 19,611 500 4001,1001,100 700 - 2005,00010,900 - - - - - - 43,600 - 43,600 4,095 - - - - 91,769 - 39,019149,256 - - - - - - 21,737 - 21,737 - - - - - - - - 3,046 - - - - - 152,427 - - 152,427 $144,596 $120,402 $231,856 $268,930 $250,465 $244,196 $255,843 $1,709,231 $3,760,874 $1,417 $3,795 $841 $-$263 $50,687 $438 $56,026 $126,837$1,417 $3,795 $841 $ - $263 $50,687 $438 $56,026 $126,837 217 - - - 4,051 - 4,539 - 18,676 - - - - - - - 31,68735,152 - - - - - 34,772 - 52,568101,314 - - - 36,502 - - 59,8002,879106,227 - - - - 500 - - 26,07726,577 1,6343,795 84136,5024,81485,45964,777169,237414,783 - - - - - - - - 3,046 - - - - - 152,427 - - 152,427 - - - - - - - - 136,487 142,962 - - 232,428245,6516,310191,0661,539,9942,692,305 - 116,607231,015 - - - - - 361,826 142,962116,607231,015232,428245,651158,737191,0661,539,9943,346,091 $144,596 $120,402 $231,856 $268,930 $250,465 $244,196 $255,843 $1,709,231 $3,760,874 99 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR SPECIAL REVENUE FUNDS For The Year Ended December 31, 2010 3 Cable Television Fund 225 Police Forfeiture Fund 265 Police Community Programs Fund 270 Police Grants Fund 272 Library Fund 240 Revenues: Taxes$ - $ - $ - $ - $738,393 Licenses and permits - - - - - Intergovernmental - - 2,41416,026 - Fees/program revenues171,766 - - - 9,805 Rents - - - - - Fines and forfeitures - 14,396 - - 14,461 Investment income: Interest and dividends5,900 - - - 4,400 Change in fair value(1,400) - - - (1,100) Other revenues: Contributions - - - - - Miscellaneous - - - - - Total revenues176,26614,3962,41416,026765,959 Expenditures: Personal services2,042 - 9,761 - 525,743 Supplies701,5029,74314,37398,719 Other services and charges 58,130 - 301,65386,354 Capital outlay - - - - - Total expenditures 60,2421,50219,53416,026710,816 Revenues over (under) expenditures 116,02412,894(17,120)055,143 Other financing sources (uses): Transfers in - - 9,000 - - Transfers out (56,668) - (36,370) - (18,864) Sale of capital assets - - - - - Total other financing sources (uses)(56,668)0(27,370)0(18,864) Net change in fund balance 59,35612,894(44,490)036,279 Fund balance - January 1 274,5381,31044,490 - 103,254 Fund balance - December 31 $333,894 $14,204 $0 $0 $139,533 100 Statement 15 After-School Programs Fund 261 Contributed Projects - Recreation - Fund 881 Contributed Projects - Other - Fund 883 Special Projects Fund 226 Community Development Fund 201 Anoka County Comm Dev Programs Fund 202 EDA Admin Fund 204 (Component Unit) HRA Funds (Component Unit) Total Nonmajor Special Revenue Funds $ - $ - $ - $ - $ - $ - $324,542$ - $1,062,935 - - - - 299,265 - - - 299,265 55,787 - - - - 149,72714,692492,940731,586 19,622 - - 20,086 - - - - 221,279 - - - 70,653 - - - 643,864714,517 - - - - - - - - 28,857 2,5002,4005,9005,7004,000 - 90027,60059,300 (600)(600)(1,400)(1,400)(1,000) - (200)(6,700)(14,400) - 37,6878,204 - - - - - 45,891 - 616 15 - - - - 15,65016,281 77,30940,10312,71995,039302,265149,727339,9341,173,3543,165,511 30,355 - - - 191,235 - 253,70736,7821,049,625 9,70711,59911,960 - 1,659 - 1,06340,898201,293 17,217 1001,250 - 13,4214,88716,571617,349816,962 - - - - - 15,858 - 280,730296,588 57,27911,69913,210 0206,31520,745271,341975,7592,364,468 20,03028,404(491)95,03995,950128,98268,593197,595801,043 - - 1,950 - - - 37,500 - 48,450 - - (43,242)(42,000)(12,666) - (63,666) - (273,476) - - - - - - - - - 0 0(41,292)(42,000)(12,666)0(26,166)0(225,026) 20,03028,404(41,783)53,03983,284128,98242,427197,595576,017 122,93288,203272,798179,389162,36729,755148,6391,342,3992,770,074 $142,962 $116,607 $231,015 $232,428 $245,651 $158,737 $191,066 $1,539,994 $3,346,091 101 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - CABLE TELEVISION FUND 225 Statement 16 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2010 With Comparative Actual Amounts For The Year Ended December 31, 2009 Variance with Budgeted Amounts Final Budget-2009 ActualPositiveActual OriginalFinalAmounts(Negative)Amounts Revenues: Franchise fees $165,000$165,000$171,766$6,766$167,351 Investment income: Interest and dividends - - 5,9005,9006,000 Change in fair value - - (1,400)(1,400)(1,700) Total revenues 165,000165,000176,26611,266171,651 Expenditures: Personal services 6,4616,4612,0424,4192,212 Supplies 1,6501,650 701,580 87 Other services and charges 34,66034,66058,130(23,470)45,787 Capital outlay 20,00020,000 - 20,000 - Total expenditures 62,77162,77160,2422,52948,086 Revenues over expenditures 102,229102,229116,02413,795123,565 Other financing sources (uses): Transfers out (56,668)(56,668)(56,668) - (68,204) Net change in fund balance $45,561 $45,561 59,356$13,795 55,361 Fund balance - January 1 274,538 219,177 Fund balance - December 31 $333,894 $274,538 2010 102 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - POLICE FORFEITURE FUND 265 Statement 17 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31, 2010 With Comparative Amounts For The Year Ended December 31, 2009 20102009 Revenues: Forfeitures $14,396$538 Expenditures: Supplies 1,5023,519 Revenues over (under) expenditures 12,894 (2,981) Fund balance - January 1 1,310 4,291 Fund balance - December 31 $14,204 $1,310 103 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - POLICE COMMUNITY PROGRAMS FUND 270 Statement 18 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2010 With Comparative Actual Amounts For The Year Ended December 31, 2009 Variance with Budgeted Amounts Final Budget-2009 ActualPositiveActual OriginalFinalAmounts(Negative)Amounts Revenues: Intergovernmental $1,000$1,000$2,414$1,414$2,718 Expenditures: Personal services 4,8004,8009,761(4,961)11,773 Supplies 10,70010,7009,743 9574,869 Other services and charges 4,5004,500 304,470 516 Total expenditures 20,000 20,000 19,534 466 17,158 Revenues over (under) expenditures (19,000)(19,000)(17,120)1,880 (14,440) Other financing sources (uses): Transfers in 9,0009,0009,000 - 9,000 Transfers out - - (36,370)(36,370) - Total other financing sources (uses)9,0009,000(27,370)(36,370)9,000 Net change in fund balance ($10,000)($10,000)(44,490)($34,490)(5,440) Fund balance - January 1 44,490 49,930 Fund balance - December 31 $0 $44,490 2010 104 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - POLICE GRANTS FUND 272 Statement 19 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31, 2010 With Comparative Amounts For The Year Ended December 31, 2009 20102009 Revenues: Intergovernmental $16,026 $19,520 Miscellaneous - 8,000 Total revenues 16,026 27,520 Expenditures: Supplies 14,373 8,000 Other services and charges 1,653 1,952 Capital outlay - 17,568 Total expenditures 16,026 27,520 Revenues over expenditures 0 0 Fund balance - January 1 - - Fund balance - December 31 $0 $0 105 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - LIBRARY FUND 240 Statement 20 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2010 With Comparative Actual Amounts For The Year Ended December 31, 2009 Variance with Budgeted Amounts Final Budget-2009 ActualPositiveActual OriginalFinalAmounts(Negative)Amounts Revenues: Taxes $738,393$738,393$738,393$ - $573,215 Intergovernmental - - - - 123,856 Charges for services 10,30010,300 9,805 (495)9,130 Fines 17,00017,00014,461(2,539)13,822 Investment income: Interest and dividends 6,000 6,000 4,400(1,600)5,300 Change in fair value - - (1,100)(1,100)(1,500) Other revenues: Miscellaneous 225 225 - (225) - Contributions 800 800 - (800) - Total revenues 772,718 772,718 765,959 (6,759)723,823 Expenditures: Personal services 542,387542,387525,74316,644463,429 Supplies 102,075102,07598,719 3,35690,477 Other services and charges 111,367111,36786,35425,01380,164 Total expenditures 755,829 755,829 710,816 45,013 634,070 Revenues over (under) expenditures 16,889 16,889 55,143 38,254 89,753 Other financing sources (uses): Transfers out (16,914)(16,914)(18,864)(1,950)(16,386) Sale of capital assets 25 25 - (25) - Total other financing sources (uses)(16,889)(16,889)(18,864)(1,975)(16,386) Net change in fund balance $0 $0 36,279 $36,279 73,367 Fund balance - January 1 103,254 29,887 Fund balance - December 31 $139,533 $103,254 2010 106 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - AFTER SCHOOL PROGRAMS FUND 261 Statement 21 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31, 2010 With Comparative Amounts For The Year Ended December 31, 2009 20102009 Revenues: Intergovernmental $55,787$42,712 Program revenue 19,62218,719 Investment income: Interest and dividends2,5002,800 Change in fair value (600)(800) Total revenues77,30963,431 Expenditures: Personal services 30,35524,841 Supplies 9,7072,987 Other services and charges 17,21717,051 Total expenditures 57,27944,879 Revenues over expenditures 20,03018,552 Fund balance - January 1 122,932104,380 Fund balance - December 31$142,962 $122,932 107 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - RECREATION CONTRIBUTED PROJECTS FUND 881 Statement 22 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31, 2010 With Comparative Amounts For The Year Ended December 31, 2009 2010 2009 Revenues: Investment income: Interest and dividends $2,400 $2,300 Change in fair value (600)(700) Other revenue: Contributions 37,687 18,300 Miscellaneous 616 - Total revenues 40,103 19,900 Expenditures: Supplies 11,599 9,575 Other services and charges 100 4,900 Capital outlay - - Total expenditures 11,699 14,475 Revenues over expenditures 28,404 5,425 Fund balance - January 1 88,203 82,778 Fund balance - December 31 $116,607 $88,203 108 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - CONTRIBUTED PROJECTS - OTHER FUND 883 Statement 23 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31, 2010 With Comparative Amounts For The Year Ended December 31, 2009 20102009 Revenues: Investment income: Interest and dividends$5,900$7,400 Change in fair value(1,400)(2,100) Contributions 8,20454,419 Miscellaneous 15 - Total revenues 12,719 59,719 Expenditures: Personal services - 1,505 Supplies 11,960 12,088 Other services and charges 1,250 1,090 Capital outlay - 38,503 Total expenditures 13,210 53,186 Revenues over expenditures (491)6,533 Other financing sources (uses): Transfers in 1,950 - Transfers out (43,242) - (41,292)0 Net change in fund balance (41,783)6,533 Fund balance - January 1 272,798 266,265 Fund balance - December 31 $231,015 $272,798 109 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - SPECIAL PROJECTS FUND 226 Statement 24 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31, 2010 With Comparative Amounts For The Year Ended December 31, 2009 2010 2009 Revenues: Fees/program revenue $20,086$20,295 Rents 70,653 62,701 Investment income: Interest and dividends 5,700 5,000 Change in fair value (1,400)(1,400) Total revenues 95,039 86,596 Expenditures: Other services and charges - 65,051 Revenues over expenditures 95,039 21,545 Other financing sources (uses): Transfers out (42,000) - Net change in fund balance 53,039 21,545 Fund balance - January 1 179,389157,844 Fund balance - December 31 $232,428$179,389 110 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - COMMUNITY DEVELOPMENT FUND 201 Statement 25 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2010 With Comparative Actual Amounts For The Year Ended December 31, 2009 Variance with Budgeted Amounts Final Budget-2009 ActualPositiveActual OriginalFinalAmounts(Negative)Amounts Revenues: Licenses and permits $227,285$227,285$299,265$71,980$256,032 Investment income: Interest and dividends - - 4,0004,0002,700 Change in fair value - - (1,000)(1,000)(800) Miscellaneous36,78236,782 - (36,782) - Total revenues 264,067 264,067 302,265 38,198 257,932 Expenditures: Personal services 225,644225,644191,23534,409433,101 Supplies 4,9304,9301,6593,2713,253 Other services and charges 20,74820,74813,4217,32729,181 Total expenditures 251,322 251,322 206,315 45,007 465,535 Revenues over (under) expenditures 12,745 12,745 95,950 83,205 (207,603) Other financing sources (uses): Transfers in - - - - 347,573 Transfers out (12,667)(12,667)(12,666)1(24,387) Total other financing sources (uses)(12,667)(12,667)(12,666)1 323,186 Net change in fund balance $78 $78 83,284 $83,206 115,583 Fund balance - January 1 162,367 46,784 Fund balance - December 31 $245,651 $162,367 2010 111 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - ANOKA COUNTY COMM DEV PROGRAMS FUND 202 Statement 26 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31, 2010 With Comparative Amounts For The Year Ended December 31, 2009 2010 2009 Revenues: Intergovernmental $149,727 $28,275 Investment income: Interest and dividends - 100 Total revenues 149,727 28,375 Expenditures: Other services and charges 4,887 4,668 Capital outlay 15,858 - Total expenditures 20,745 4,668 Revenues over expenditures 128,982 23,707 Fund balance - January 1 29,755 6,048 Fund balance - December 31 $158,737 $29,755 112 CITY OF COLUMBIA HEIGHTS, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION Statement 27 BUDGETARY COMPARISON SCHEDULE - ECONOMIC DEVELOPMENT AUTHORITY ADMINISTRATION FUND 204 (COMPONENT UNIT) For The Year Ended December 31, 2010 With Comparative Actual Amounts For The Year Ended December 31, 2009 Variance with Budgeted Amounts Final Budget-2009 ActualPositiveActual OriginalFinalAmounts(Negative)Amounts Revenues: Taxes $346,527$331,835$324,542($7,293)$322,844 Intergovernmental: Market value homestead credit - 14,69214,692 - 16,305 Investment income: Interest and dividends - - 900 900 1,432 Change in fair value - - (200)(200)(200) Total revenues 346,527346,527339,934(6,593)340,381 Expenditures: Personal services 247,929247,929253,707(5,778) - Other services and charges 30,43330,43316,57113,862 70 Supplies 4,400 4,400 1,063 3,337 - Capital outlay - - - - 20,207 Total expenditures 282,762282,762271,34111,42120,277 Revenues over (under) expenditures 63,76563,76568,593 4,828320,104 Other financing sources (uses): Transfers in - - 37,50037,500 - Transfers out (63,666)(63,666)(63,666) - (347,573) Total other financing sources (uses)(63,666)(63,666)(26,166)37,500 (347,573) Net change in fund balance $99 $9942,427$42,328(27,469) Fund balance - January 1 148,639 176,108 Fund balance - December 31 $191,066 $148,639 2010 113 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUNDS - HOUSING AND REDEVELOPMENT AUTHORITY (COMPONENT UNIT)Statement 28 COMBINING BALANCE SHEET December 31, 2010 Parkview Parkview Total Villa Villa Housing and North South Redevelopment Fund 203 Fund 213 Authority Assets Cash and investments $1,032,526 $630,426 $1,662,952 Receivables: Accounts 371 1,889 2,260 Interest 3,000 2,000 5,000 Interfund receivable - - - Due from other governmental units 39,019 - 39,019 Total assets $1,074,916 $634,315 $1,709,231 Liabilities and Fund Balance Liabilities: Accounts payable $37,444 $18,582 $56,026 Due to other governmental units 19,847 11,840 31,687 Interfund payable 39,422 13,146 52,568 Deferred revenue 792 2,087 2,879 Deposits 17,000 9,077 26,077 Total liabilities 114,505 54,732 169,237 Fund balance: Unreserved: Designated for maintenance 960,411 579,583 1,539,994 Total fund balance 960,411 579,583 1,539,994 Total liabilities and fund balance $1,074,916 $634,315 $1,709,231 114 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUNDS - HOUSING AND REDEVELOPMENT AUTHORITY (COMPONENT UNIT)Statement 29 COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For The Year Ended December 31, 2010 Parkview Parkview Total Villa Villa Housing and North SouthRedevelopment Fund 203 Fund 213 Authority Revenues: Intergovernmental $492,940 $ - $492,940 Rents 341,456 302,408 643,864 Investment income: Interest and dividends 16,500 11,100 27,600 Change in fair value (4,000)(2,700)(6,700) Other revenues: Miscellaneous 9,540 6,110 15,650 Total revenues 856,436 316,918 1,173,354 Expenditures: Personal services 25,380 11,402 36,782 Supplies 31,561 9,337 40,898 Other services and charges 420,046 197,303 617,349 Capital outlay 280,730 - 280,730 Total expenditures 757,717 218,042 975,759 Revenues over expenditures 98,719 98,876 197,595 Fund balance - January 1 861,692 480,707 1,342,399 Fund balance - December 31 $960,411 $579,583 $1,539,994 115 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - HOUSING & REDEVELOPMENT AUTHORITY- Statement 30 PARKVIEW VILLA NORTH FUND 203 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2010 With Comparative Actual Amounts For The Year Ended December 31, 2009 Variance with Budgeted Amounts Final Budget-2009 ActualPositiveActual OriginalFinalAmounts(Negative)Amounts Revenues: Intergovernmental revenue $345,681$345,681$492,940$147,259$275,002 Rents 320,574320,574341,45620,882316,869 Investment income: Interest and dividends 5,0005,00016,50011,50017,700 Change in fair value - - (4,000)(4,000)(5,100) Other revenues - - 9,5409,5408,902 Total revenues 671,255671,255856,436185,181613,373 Expenditures: Personal services 25,38025,38025,380 - 23,760 Supplies 20,55020,55031,561(11,011)24,289 Other services and charges 439,487439,487420,04619,441387,951 Capital outlay 155,956155,956280,730(124,774)63,819 Total expenditures 641,373641,373757,717(116,344)499,819 Revenues over (under) expenditures $29,882$29,88298,719$68,837113,554 Fund balance - January 1 861,692 748,138 Fund balance - December 31 $960,411 $861,692 2010 116 CITY OF COLUMBIA HEIGHTS, MINNESOTA SPECIAL REVENUE FUND - HOUSING & REDEVELOPMENT AUTHORITY - Statement 31 PARKVIEW VILLA SOUTH FUND 213 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL For The Year Ended December 31, 2010 With Comparative Actual Amounts For The Year Ended December 31, 2009 Variance with Budgeted Amounts Final Budget-2009 ActualPositiveActual OriginalFinalAmounts(Negative)Amounts Revenues: Rents $297,092$297,092$302,408$5,316$296,727 Investment income: Interest and dividends 2,500 2,50011,100 8,60010,500 Change in fair value - - (2,700)(2,700)(3,000) Other 2,965 2,965 6,110 3,145 3,962 Total revenues 302,557302,557316,91814,361308,189 Expenditures: Personal services 11,40211,40211,402 - 12,020 Supplies 11,32011,320 9,337 1,983 7,248 Other services and charges 194,708194,708197,303(2,595)187,067 Capital outlay 64,35064,350 - 64,35032,242 Total expenditures 281,780281,780218,04263,738238,577 Revenues over expenditures $20,777$20,77798,876$78,09969,612 Fund balance - January 1 480,707 411,095 Fund balance - December 31 $579,583 $480,707 2010 117 - This page intentionally left blank - 118 NONMAJOR DEBT SERVICE FUNDS The City of Columbia Heights had the following kinds of Nonmajor Debt Service Funds during the year: Bond Debt Service Funds – are separate funds used to account for the revenues and expenditures of each separate bond issue. Tax Increment Financing Funds – are separate funds used to account for the revenues and expenditures of each separate Tax Increment Financing District. 119 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR DEBT SERVICE FUNDS December 31, 2010 G.O. Improvement Bonds 1999A Fund 387 G.O. Improvement/ Revenue Bonds 2003A Fund 388 G.O. Improvement/ Revenue Bonds 2006A Fund 340 G.O. Street Rehabilitation Bonds 2007 Fund 341 G.O. Public Safety Center Bonds 2008B Fund 343 Assets Cash and investments $ - $484,055$851,373$108,784$400,719 Receivables: Taxes - - - - 9,895 Interest - - 1,300 200100 Land held for resale - - - - - Total assets $0$484,055$852,673$108,984$410,714 Liabilities and Fund Balance Liabilities: Accounts payable $ - $ - $ - $ - $ - Due to other governmental units - - - - - Deferred revenue: Interfund payable - - - - - Property taxes - delinquent - - - - - Total liabilities 0 0 0 0 0 Fund balance (deficit): Reserved for real estate held for resale - - - - - Designated for debt service - 484,055852,673108,984410,714 Undesignated - - - - - Total fund balance (deficit)0484,055852,673108,984410,714 Total liabilities and fund balance $0$484,055$852,673$108,984$410,714 120 Statement 32 G.O. Public Facilities Bonds 2009A Fund 344 Tax Increment Bonds Fund 376 Sheffield TIF Redevelopment Fund 377 TIF Multi-Use Redevelopment Plan Fund 385 TIF Transition Block Fund 389 TIF 47th and Central Avenue Fund 371 TIF Huset Park Area Fund 372 EDA TIF Revenue Bonds 2007 Fund 373 Total Nonmajor Debt Service Funds $304,936$348,052$50,464 $71,142$66,418$608,554$162,443$243,597$3,700,537 - 456 2,931 65 - 5,85717,521 - 36,725 3001,400 300 2002002,5004007007,600 - 571,717 - - - 204,726 - - 776,443 $305,236$921,625$53,695 $71,407$66,618$821,637$180,364$244,297$4,521,305 $ - $1,119$ - $12,653$24,409$ - $332$ - $38,513 - 7,950 - - - - - - 7,950 - - 111,289 21,737 - - - - 133,026 - - 1,624 - - 3,8529,861 - 15,337 09,069112,913 34,39024,4093,85210,193 0194,826 - 571,717 - - - 204,726 - - 776,443 305,236340,839 - 37,01742,209613,059170,171244,2973,609,254 - - (59,218) - - - - - (59,218) 305,236912,556(59,218)37,01742,209817,785170,171244,2974,326,479 $305,236$921,625$53,695 $71,407$66,618$821,637$180,364$244,297$4,521,305 EDA Component Unit 121 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR DEBT SERVICE FUNDS For The Year Ended December 31, 2010 G.O. Improvement Bonds 1999A Fund 387 G.O. Improvement/ Revenue Bonds 2003A Fund 388 G.O. Improvement/ Revenue Bonds 2006A Fund 340 G.O. Street Rehabilitation Bonds 2007 Fund 341 G.O. Public Safety Center Bonds 2008B Fund 343 Revenues: Taxes $ - $ - $ - $94,372$685,931 Tax increment collections - - - - - Intergovernmental - - - - - Investment income: Interest and dividends 4,100 - 7,099 1,299 502 Change in fair value (1,000) - (1,700)(300)(100) Total revenues 3,100 0 5,39995,371686,333 Expenditures: Current: Other services and charges - - - - - Capital outlay: Community development - - - - - Debt service: Principal retirement 65,00094,836397,90085,000 - Interest and fiscal charges 1,39827,84378,46038,496441,684 Issuance costs - - - - - Developer incentives - - - - - Total expenditures 66,398122,679476,360123,496441,684 Revenues over (under) expenditures (63,298)(122,679)(470,961)(28,125)244,649 Other financing sources (uses): Transfers in - 630,789622,180 - - Transfers out (209,798) - - - - Total other financing sources (uses)(209,798)630,789622,180 0 0 Net change in fund balance (273,096)508,110151,219(28,125)244,649 Fund balance (deficit) - January 1 273,096(24,055)701,454137,109166,065 Fund balance (deficit) - December 31 $0$484,055$852,673$108,984$410,714 122 Statement 33 G.O. Public Facilities Bonds 2009A Fund 344 Tax Increment Bonds Fund 376 Sheffield TIF Redevelopment Fund 377 TIF Multi- Use Redevelopm ent Plan Fund 385 TIF Transition Block Fund 389 TIF 47th and Central Avenue Fund 371 TIF Huset Park Area Fund 372 EDA TIF Revenue Bonds 2007 Fund 373 Total Nonmajor Debt Service Funds $201,505$ - $ - $ - $ - $ - $ - $ - $981,808 - 169,932 86,67633,66954,374170,870300,414 - 815,935 - 37,043 5,589350 - 3,27728,539 - 74,798 1,5017,700 1,5011,3001,00013,7022,4013,70045,805 (400)(1,900)(400)(300)(200)(3,300)(600)(900)(11,100) 202,606212,775 93,36635,01955,174184,549330,7542,8001,907,246 - 13,232 1,0751,5241,5246,9163,947 - 28,218 - 73,727 - - - 569,497 - - 643,224 40,000 - - - - - - 43,000725,736 148,886 - 8,362 - - 28,961 - 152,375926,465 - - - - - - - - - - - - 25,30748,818 - 66,880 - 141,005 188,88686,959 9,43726,83150,342605,37470,827195,3752,464,648 13,720125,816 83,9298,1884,832(420,825)259,927(192,575)(557,402) 142,538 - - - - - - 178,0001,573,507 - - - - - - (178,000) - (387,798) 142,538 0 0 0 0 0(178,000)178,0001,185,709 156,258125,816 83,9298,1884,832(420,825)81,927(14,575)628,307 148,978786,740(143,147)28,82937,3771,238,61088,244258,8723,698,172 $305,236$912,556($59,218)$37,017$42,209$817,785$170,171$244,297$4,326,479 EDA Component Unit 123 - This page intentionally left blank - 124 NONMAJOR CAPITAL PROJECT FUNDS The City of Columbia Heights had the following Nonmajor Capital Project Funds during the year: Downtown Parking Maintenance Fund 405 – used for maintenance of a parking ramp west of Central Avenue. 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 to foster economic development in the City. Housing Maintenance Fund 408 – established to account for activities to maintain the quality and quantity of housing in the City. Capital Sheffield Redevelopment Fund 410 - used to fund redevelopment of the area of the City identified as the Sheffield Neighborhood. Capital Improvement PVVS Fund 414 – used to account for improvements to the Parkview Villa South building. Capital Improvement Parks Fund 412 – used to account for improvements in City parks. This includes park dedication fees when available, the use of which is limited by state statute to park improvements. Capital Improvement Fund 401 – used to account for capital projects for which funding is provided by a number of internal and external sources. Community Center Capital Building Fund 418 - used to account for the planning and construction of a gymnasium facility. Infrastructure Replacement Fund 430 – used to fund replacement of City infrastructure. Capital Equipment Fire Fund 439 – used to fund replacement of fire department capital assets. This fund is limited by state statute to fire department expenditures. The original source of the assets in this fund was excess funding in a fire pension plan. Capital Equipment Cable TV Fund 440 – used to fund replacement of cable television capital assets. Capital Building Library Fund 450 – used to fund replacement of the library building. 125 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR CAPITAL PROJECT FUNDS December 31, 2010 Downtown Parking Maintenance Fund 405 EDA (Component Unit) Housing Maintenance Fund 408 Capital Sheffield Redevelopment Fund 410 Capital Improvement PVVS Fund 414 Capital Improvement Parks Fund 412 Assets Cash and investments $ - $ - $ - $ - $270,260 Receivables: Interest - - - - 800 Real estate held for ressale - 393,473 - - - Total assets $0$393,473 $0 $0$271,060 Liabilities and Fund Balance Liabilities: Accounts payable $ - $ - $ - $ - $ - Contracts payable - retained percentage - - - - 1,381 Total liabilities 0 0 0 0 1,381 Fund balance: Reserved for: Real estate held for resale - 393,473 - - - Unreserved: Designated for capital expenditures - - - - 269,679 Total fund balance 0393,473 0 0269,679 Total liabilities and fund balance $0$393,473 $0 $0$271,060 126 Statement 34 Capital Improvement Fund 401 Community Center Capital Building Fund Infrastructure Replacement Fund 430 Capital Equipment Fire Fund 439 Capital Equipment Cable TV Fund 440 Capital Building Library Fund 450 Total Nonmajor Capital Project Funds $ - $ - $867,958$181,463$283,093$255,504$1,858,278 - - 3,400 800 500 - 5,500 - - - - - - 393,473 $0 $0$871,358$182,263$283,593$255,504$2,257,251 $ - $ - $ - $ - $69,842$ - $69,842 - - - - - - 1,381 000069,842 071,223 - - - - - - 393,473 - - 871,358182,263213,751255,5041,792,555 0 0871,358182,263213,751255,5042,186,028 $0 $0$871,358$182,263$283,593$255,504$2,257,251 127 CITY OF COLUMBIA HEIGHTS, MINNESOTA SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR CAPITAL PROJECT FUNDS For The Year Ended December 31, 2010 Downtown Parking Maintenance Fund 405 EDA (Component Unit) Housing Maintenance Fund 408 Capital Sheffield Redevelopment Fund 410 Capital Improvement PVVS Fund 414 Revenues: Intergovernmental $ - $ - $ - $ - Charges for services - 75 - - Investment income: Interest and dividends 3,000 2,900 8,300 700 Change in fair value (700)(700)(2,000)(200) Contributions - - - - Total revenues 2,300 2,275 6,300 500 Expenditures: Current: Personal services - - - - Other services and charges 14,998111,126 - - Capital outlay - 19,440 - - Total expenditures 14,998130,566 0 0 Revenue over (under) expenditures (12,698)(128,291)6,300 500 Other financing sources (uses): Transfers in - 600,000 - - Transfers out (135,276)(218,238)(735,532)(30,955) Total other financing sources (uses)(135,276)381,762(735,532)(30,955) Net change in fund balance (147,974)253,471(729,232)(30,455) Fund balance - January 1 147,974140,002729,23230,455 Fund balance - December 31 $0$393,473 $0 $0 128 Statement 35 Capital Improvement Parks Fund 412 Capital Improvement Fund 401 Community Center Capital Building Fund Infrastructure Replacement Fund 430 Capital Equipment Fire Fund 439 Capital Equipment Cable TV Fund 440 Capital Building Library Fund 450 Total Nonmajor Capital Project Funds $35,490$ - $ - $ - $ - $ - $ - $35,490 15,7241,761 - - - - - 17,560 4,400 - 14,90118,7004,1002,600 - 59,601 (1,100) - (3,600)(4,500)(1,000)(600) - (14,400) - 75 - - - 194,842 - 194,917 54,5141,83611,30114,2003,100196,842 0293,168 - - - - - - - - 1,5041,837 - 12,57510,07769,842 - 221,959 - - - 111,424 - - - 130,864 1,5041,837 0123,99910,07769,842 0352,823 53,010 (1)11,301(109,799)(6,977)127,000 0(59,655) 50,000 - - 180,489 - - 55,504885,993 - (80,489)(761,019) - - - - (1,961,509) 50,000(80,489)(761,019)180,489 0 055,504(1,075,516) 103,010(80,490)(749,718)70,690(6,977)127,00055,504(1,135,171) 166,66980,490749,718800,668189,24086,751200,0003,321,199 $269,679 $0 $0$871,358$182,263$213,751$255,504$2,186,028 129 - This page intentionally left blank - 130 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 financed and/or 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 municipal liquor stores. 131 CITY OF COLUMBIA HEIGHTS, MINNESOTA WATER UTILITY FUND Statement 36 SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2010 With Comparative Totals for December 31, 2009 Operating Account Capital Equipment Replacement Account Capital Construction Account Debt Service Account Intrafund Eliminations Assets 20102009 Current assets: Cash and cash equivalents $88,715$460,168$ - $189,629$ - $738,512$594,392 Receivables: Accounts (net of allowance for uncollectables)532,616 - - - - 532,616495,820 Interest 1,7001,800 - 300 - 3,8002,500 Interfund receivable 506,753 - - - (487,806)18,947 - Inventory - at cost 2,143 - - - - 2,1432,695 Total current assets 1,131,927461,968 0189,929(487,806)1,296,0181,095,407 Noncurrent assets: Capital assets: Land 45,223 - - - - 45,22345,223 Buildings 559,826 - - - - 559,826559,826 Equipment 456,629 - - - - 456,629456,629 Infrastructure 7,420,389 - - - - 7,420,3897,420,389 Construction in process - - 161,470 - - 161,470103,820 Total capital assets 8,482,067 0161,470 0 08,643,5378,585,887 Less: accumulated depreciation (3,840,014) - - - - (3,840,014)(3,630,125) Total capital assets (net of accumulated depreciation)4,642,053 0161,470 0 04,803,5234,955,762 Total noncurrent assets 4,642,053 0161,470 0 04,803,5234,955,762 Total assets 5,773,980461,968161,470189,929(487,806)6,099,5416,051,169 Totals Liabilities Current liabilities: Accounts payable 7,859 - - - - 7,8598,281 Accrued salaries and withholdings payable9,734 - - - - 9,7345,114 Due to other governmental units 92,292 - - - - 92,292220,254 Interfund payable - - 487,806 - (487,806) - - Accrued interest payable - - - 27,049 - 27,04931,660 Deposits - - - - - - 1,000 Compensated absences payable - current 3,229 - - - - 3,2291,077 Bonds payable - current - - - 191,805 - 191,805269,029 Total current liabilities 113,114 0487,806218,854(487,806)331,968536,415 Noncurrent liabilities: Compensated absences payable - noncurrent21,291 - - - - 21,29120,338 Bonds payable - noncurrent - - - 1,578,768 - 1,578,7681,770,573 Total noncurrent liabilities 21,291 0 01,578,768 01,600,0591,790,911 Total liabilities 134,405 0487,8061,797,622(487,806)1,932,0272,327,326 Net Assets Invested in capital assets, net of related debt4,642,053 - 161,470(1,833,635) - 2,969,8882,979,252 Restricted for debt service - 14,045 - 225,942 - 239,987326,204 Unrestricted 997,522447,923(487,806) - - 957,639418,387 Total net assets $5,639,575 $461,968 ($326,336)($1,607,693)$0 $4,167,514 $3,723,843 132 CITY OF COLUMBIA HEIGHTS, MINNESOTA WATER UTILITY FUND Statement 37 SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For Year Ended December 31, 2010 With Comparative Totals for Year Ended December 31, 2009 Operating Account Capital Equipment Replacement Account Capital Construction Account Debt Service Account Intrafund Eliminations Operating revenues:20102009 Charges for services: Customer services $123,356$ - $ - $ - $ - $123,356$176,910 Penalties 54,953 - - - - 54,95350,801 Charges for sales: Water 2,236,231 - - - - 2,236,2312,157,002 Meter 15,296 - 33,39234,536 - 83,22485,550 Total operating revenues 2,429,836 033,39234,536 02,497,7642,470,263 Operating expenses: Cost of sales 1,034,837 - - - - 1,034,837992,621 Distribution 621,428 - 844 - - 622,272594,857 Administration 19,377 - - - - 19,37719,465 Depreciation 209,889 - - - - 209,889213,484 Total operating expenses 1,885,531 0 844 0 0 1,886,375 1,820,427 Net income (loss) from operations 544,305 0 32,548 34,536 0 611,389 649,836 Nonoperating revenues (expenses): Investment income: Interest and dividends 9,0009,700 - 1,800 - 20,50018,200 Change in fair value (2,200)(2,300) - (400) - (4,900)(5,100) Miscellaneous revenues 2,236 - 3,506 - - 5,742994 Interest and fiscal charges - - - (67,492) - (67,492)(71,532) Totals Total nonoperating revenues (expenses)9,036 7,400 3,506 (66,092)0 (46,150)(57,438) Net income (loss) before transfers 553,341 7,400 36,054 (31,556)0 565,239 592,398 Transfers in - 25,000 846176,000(201,846) - 24,224 Transfers out (323,414) - - - 201,846(121,568)(120,723) Total transfers (323,414)25,000 846 176,000 0 (121,568)(96,499) Change in net assets 229,927 32,400 36,900 144,444 0 443,671 495,899 Total net assets - January 1 5,409,648429,568(363,236)(1,752,137) - 3,723,843 3,227,944 Total net assets - December 31 $5,639,575$461,968($326,336)($1,607,693)$0$4,167,514$3,723,843 133 CITY OF COLUMBIA HEIGHTS, MINNESOTA WATER UTILITY FUND Statement 38 SUBCOMBINING SCHEDULE OF CASH FLOWS For Year Ended December 31, 2010 With Comparative Totals for Year Ended December 31, 2009 2010 2009 Cash flows from operating activities: Cash received from customers $2,466,710 $2,489,358 Cash paid to suppliers for goods and services (1,441,403)(1,417,241) Cash payments to employees for services (356,190)(310,542) Net cash provided by (used in) from operating activities 669,117 761,575 Cash flows from noncapital financing activities: Transfers in - 24,224 Transfers out (121,568)(120,723) Interfund receivable repaid by (advanced to) other funds (18,947)3,216 Interfund payable (repaid to) advanced by other funds - (184,471) Net cash flows provided by (used in) noncapital financing activities (140,515)(277,754) Cash flows from capital and related financing activities: Acquisition of capital assets (57,650)(214,721) Bonds issued - 325,000 Principal payments - bonds (269,029)(240,127) Interest and fiscal charges (72,103)(71,056) Net cash flows provided by (used in) capital and related financing activities (398,782)(200,904) Cash flows from investing activities: Investment income: Interest and dividends 19,200 25,001 Change in fair value (4,900)(5,100)g (,)(,) Net cash flows provided by (used in) investing activities 14,300 19,901 Net increase (decrease) in cash and cash equivalents 144,120 302,818 Cash and cash equivalents - January 1 594,392 291,574 Cash and cash equivalents - December 31 $738,512 $594,392 Reconciliation of operating income to net cash flows from operating activities: Operating income $611,389 $649,836 Adjustments to reconcile operating income to net cash flows from operating activities: Depreciation expense 209,889 213,484 Miscellaneous revenues 5,742 994 Changes in assets and liabilities: (Increase) decrease in accounts receivable (36,796)18,101 (Increase) decrease in inventory, at cost 552 (867) Increase (decrease) in accounts payable (422)(18,726) Increase (decrease) in accrued salaries and withholdings payable 4,620 (9,849) Increase (decrease) in due to other governmental units (127,962)56,667 Adjustment for nonoperating portion - (147,171) Increase (decrease) in deposits payable (1,000) - Increase (decrease) in compensated absences payable 3,105 (894) Total adjustments 57,728 111,739 Net cash flows provided by (used in) operating activities $669,117 $761,575 Noncash capital and related financing activities: Capital assets purchased/constructed on account $ - $147,171 134 CITY OF COLUMBIA HEIGHTS, MINNESOTA SEWER UTILITY FUND Statement 39 SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2010 With Comparative Totals for December 31, 2009 Operating Account Capital Equipment Replacement Account Capital Construction Account Debt Service Account Assets 20102009 Current assets: Cash and cash equivalents $863,141$410,688$724,564$ - $1,998,393$2,084,584 Receivables: Accounts (net of allowance for uncollectibles)345,876 - - - 345,876329,087 Interest 4,1001,6002,800 - 8,5007,400 Due from other governmental units - current - - - - - 83,349 Interfund receivables - - 111,289 - 111,289186,648 Prepayments 75,091 - - - 75,09172,218 Total current assets 1,288,208412,288838,653 02,539,1492,763,286 Noncurrent assets: Due from other governmental units - noncurrent - - - - - - Capital assets: Land 36,586 - - - 36,58636,586 Buildings 100,426 - - - 100,426100,426 Equipment 840,942 - - - 840,942840,942 Construction in progress - - 102,690 - 102,690 - Infrastructure 5,482,680 - - - 5,482,6805,011,320 Total capital assets 6,460,634 0102,690 06,563,3245,989,274 Less: accumulated depreciation (3,975,466) - - - (3,975,466)(3,798,383) Totals Net capital assets 2,485,168 0102,690 02,587,8582,190,891 Total noncurrent assets 2,485,168 0 102,690 0 2,587,858 2,190,891 Total assets 3,773,376412,288941,343 05,127,0074,954,177 Liabilities Current liabilities: Accounts payable 2,531 - 1,857 - 4,388115,971 Accrued salaries and withholdings payable 3,344 - 502 - 3,8462,996 Contracts payable - retained percentage 31,100 - - - 31,10066,650 Accrued interest payable - - - - - 83 Compensated absences payable - current 3,513 - - - 3,5131,155 Bonds payable - current - - - - - 4,653 Total current liabilities40,48802,359042,847191,508 Noncurrent liabilities: Compensated absences payable - noncurrent23,161 - - - 23,16121,812 Bonds payable - noncurrent - - - - - - Total noncurrent liabilities23,16100023,16121,812 Total liabilities 63,649 02,359 066,008213,320 Net Assets Invested in capital assets, net of related debt2,485,168 - 102,690 - 2,587,8582,186,238 Restricted for debt service - - - - - 4,803 Unrestricted 1,224,559412,288836,294 - 2,473,1412,549,816 Total net assets $3,709,727$412,288$938,984 $0$5,060,999$4,740,857 135 CITY OF COLUMBIA HEIGHTS, MINNESOTA SEWER UTILITY FUND Statement 40 SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For Year Ended December 31, 2010 With Comparative Totals for Year Ended December 31, 2009 Operating Account Capital Equipment Replacement Account Capital Construction Account Debt Service Account Interfund Eliminations Operating revenues:20102009 Charges for services: Sewer service charges$1,592,133$ - $ - $ - $ - $1,592,133$1,464,582 Penalties - - - - - - (226) Total operating revenues1,592,133 0 0 0 01,592,1331,464,356 Operating expenses: Disposal 866,612 - - - - 866,612896,603 Collection 322,049 - 43,929 - - 365,978599,879 Administration 19,315 - - - - 19,31519,364 Depreciation 177,083 - - - - 177,083183,511 Total operating expenses1,385,059 043,929 0 01,428,9881,699,357 Net income (loss) from operations207,074 0(43,929)0 0163,145(235,001) Nonoperating revenues (expenses) Investment income: Interest and dividends 23,2438,60023,562 - - 55,40566,901 Change in fair value (5,400)(2,100)(3,700) - - (11,200)(15,000) Miscellaneous revenues 2,189 - - - - 2,1891,140 Interest and fiscal charges - - - (17) - (17)(283) Total nonoperating revenues (expenses)20,032 6,500 19,862 (17)0 46,377 52,758 Net income (loss) before transfers227,106 6,500 (24,067)(17)0 209,522 (182,243) Capital contributions 234,668 - - - - 234,668 - Transfers in - 25,00044,13517(69,152) - - Transfers out (193,200) - - - 69,152(124,048)(120,722) Total transfers 41,468 25,000 44,135 17 0 110,620 (120,722) Change in net assets 268,574 31,500 20,068 0 0 320,142 (302,965) Net assets - January 1 3,441,153380,788918,916 - - 4,740,8575,043,822 Net assets - December 31 $3,709,727$412,288$938,984$0 $0$5,060,999$4,740,857 Totals 136 CITY OF COLUMBIA HEIGHTS, MINNESOTA SEWER UTILITY FUND Statement 41 SUBCOMBINING SCHEDULE OF CASH FLOWS For Year Ended December 31, 2010 With Comparative Totals for Year Ended December 31, 2009 20102009 Cash flows from operating activities: Cash received from customers $1,660,882 $1,488,249 Cash paid to suppliers for goods and services (1,183,192)(1,085,850) Cash payments to employees for services (214,162)(268,085) Net cash flows provided by (used in) operating activities 263,528 134,314 Cash flows from noncapital financing activities: Transfers out (124,048)(120,722) Interfund receivable repaid by (advanced to) other funds 75,359 297,637 Net cash flows provided by (used in) noncapital financing activities (48,689)176,915 Cash flows from capital and related financing activities: Acquisition of capital assets (339,382) - Principal payments - bonds (4,653)(4,469) Interest and fiscal charges (100)(361) Net cash flows provided by (used in) capital and related financing activities (344,135)(4,830) Cash flows from investing activities: Investment income: Interest and dividends 54,305 75,369 Change in fair value (11,200)(15,000) Net cash flows provided by (used in) investing activities 43,105 60,369 Net increase (decrease) in cash and cash equivalents (86,191)366,768 Cash and cash equivalents - January 1 2,084,584 1,717,816 Cash and cash equivalents - December 31 $1,998,393 $2,084,584 Reconciliation of operating income (loss) to net cash flows from operating activities: Operating income (loss)$163,145 ($235,001) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation expense 177,083 183,511 Miscellaneous revenues 2,189 1,140 Changes in assets and liabilities: (Increase) decrease in accounts receivable (16,789)(4,723) (Increase) decrease in due from other governmental units 83,349 27,476 (Increase) decrease in prepayments (2,873)2,499 Increase (decrease) in accounts payable (111,583)113,791 Increase (decrease) in accrued salaries and withholdings payable 850 (10,967) Increase (decrease) in contracts payable -retained percentage (35,550)66,650 Increase (decrease) compensated absences payable 3,707 (10,062) Total adjustments 100,383 369,315 Net cash flows provided by (used in) operating activities $263,528 $134,314 Noncash capital and related financing activities: Contribution of capital asset from government $234,668 $ - 137 CITY OF COLUMBIA HEIGHTS, MINNESOTA REFUSE UTILITY FUND Statement 42 SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2010 With Comparative Totals for December 31, 2009 20102009 Assets Current assets: Cash and cash equivalents$572,189$473,947 Receivables: Accounts (net of allowance for uncollectibles)379,455330,782 Interest 2,500 1,900 Due from other governmental units - 32,171 Total current assets 954,144 838,800 Noncurrent assets: Capital assets: Buildings 6,000 6,000 Equipment 108,690 108,690 Total capital assets 114,690 114,690 Less: accumulated depreciation (113,190)(112,890) Total capital assets (net of accumulated depreciation)1,500 1,800 Total noncurrent assets 1,500 1,800 Total assets 955,644 840,600 Liabilities Current liabilities: Accounts payable 106,421 103,934 Accrued salaries and withholdings payable 1,149 1,156 Compensated absences payable - current 695 220 Total current liabilities 108,265 105,310 Noncurrent liabilities: Compensated absences payable - noncurrent 4,585 4,160 Total liabilities 112,850 109,470 Net Assets Invested in capital assets, net of related debt 1,500 1,800 Unrestricted 841,294 729,330 Total net assets $842,794 $731,130 138 CITY OF COLUMBIA HEIGHTS, MINNESOTA REFUSE UTILITY FUND Statement 43 SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For Year Ended December 31, 2010 With Comparative Totals for Year Ended December 31, 2009 20102009 Operating revenues: Refuse service charges $1,539,842 $1,383,979 Operating expenses: Collection and disposal 1,238,703 1,156,501 Administration 60,994 56,235 Recycling 67,088 29,744 Hazardous waste 2,674 1,812 Depreciation 300 4,915 Total operating expenses 1,369,759 1,249,207 Net income from operations 170,083 134,772 Nonoperating revenues: Investment income: Interest and dividends 13,700 13,800 Change in fair value (3,300)(3,900) Intergovernmental 36,653 50,105 Total nonoperating revenues 47,053 60,005 Net income before transfers 217,136 194,777 Transfers out (105,472)(118,133) Change in net assets 111,664 76,644 Total net assets - January 1 731,130 654,486 Total net assets - December 31 $842,794 $731,130 139 CITY OF COLUMBIA HEIGHTS, MINNESOTA REFUSE UTILITY FUND Statement 44 SUBCOMBINING SCHEDULE OF CASH FLOWS For Year Ended December 31, 2010 With Comparative Totals for Year Ended December 31, 2009 20102009 Cash flows from operating activities: Cash received from customers $1,491,169 $1,373,419 Cash paid to suppliers for goods and services (1,283,089)(1,170,256) Cash payments to employees for services (82,990)(55,888) Net cash flows provided by (used in) operating activities 125,090 147,275 Cash flows from noncapital financing activities: Transfers out (105,472)(118,133) Intergovernmental 68,824 68,506 Interfund receivable repaid by (advanced to) other funds - 1,138 Net cash flows provided by (used in) noncapital financing activities (36,648)(48,489) Cash flows from investing activities: Investment income: Interest and dividends 13,100 14,900 Change in fair value (3,300)(3,900) Net cash flows provided by (used in) investing activities 9,800 11,000 Net increase in cash and cash equivalents 98,242 109,786 Cash and cash equivalents - January 1 473,947 364,161 Cash and cash equivalents - December 31 $572,189 $473,947 Reconciliation of operating income (loss) to net cash flows from operating activities: Operating income $170,083 $134,772 Adjustments to reconcile operating income to net cash flows from operating activities: Depreciation expense 300 4,915 Changes in assets and liabilities: (Increase) decrease in accounts receivable (48,673)(10,560) Increase (decrease) in accounts payable 2,487 14,259 Increase (decrease) in accrued salaries and withholdings payable (7)(491) Increase (decrease) compensated absences payable 900 4,380 Total adjustments (44,993)12,503 Net cash flows provided by (used in) operating activities $125,090 $147,275 140 CITY OF COLUMBIA HEIGHTS, MINNESOTA STORM SEWER UTILITY FUND Statement 45 SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2010 With Comparative Totals for December 31, 2009 Operating Account Capital Equipment Replacement Account Capital Construction Account Debt Service Account Intrafund Eliminations Assets 20102009 Current assets: Cash and cash equivalents $ - $ - $ - $6,057$ - $6,057$86,394 Receivables: Accounts (net of allowance for uncollectibles)78,636 - - - - 78,63675,445 Interest - - 800100 - 900800 Interfund receivable - - 147,68838,198(185,886) - - Total current assets 78,636 0148,48844,355(185,886)85,593162,639 Noncurrent assets: Capital assets: Land 254,724 - - - - 254,724254,724 Equipment 95,719 - - - - 95,71995,719 Infrastructure 1,477,536 - - - - 1,477,5361,477,536 Construction in process - - 39,348 - - 39,348 - Total capital assets 1,827,979 039,348 0 01,867,3271,827,979 Less: accumulated depreciation (551,097) - - - - (551,097)(476,767) Net capital assets 1,276,882 039,348 0 01,316,2301,351,212 Total noncurrent assets 1,276,882 039,348 0 01,316,2301,351,212 Total assets 1,355,518 0187,83644,355(185,886)1,401,8231,513,851 Liabilities Current liabilities: Accounts payable 3,232 - - - - 3,2321,149 Accrued salaries and withholdings payable1,996 - - - - 1,996663 Due to other governmental units - - - - - - 48,401 Interfund payable 167,16218,724 - - (185,886) - - Accrued interest payable - - - 5,731 - 5,7318,101 Compensated absences payable - current 171 - - - - 171 60 Bonds payable - current - - - 37,575 - 37,575138,582 Total current liabilities 172,56118,724 043,306(185,886)48,705196,956 Noncurrent liabilities: Compensated absences payable - noncurrent 1,124 - - - - 1,1241,139 Bonds payable - noncurrent - - - 320,100 - 320,100357,675 Total noncurrent liabilities 1,124 0 0320,100 0321,224358,814 Total liabilities 173,68518,724 0363,406(185,886)369,929555,770 Net Assets Invested in capital assets, net of related debt1,276,882 - 39,348(357,675) - 958,555854,955 Restricted for debt service - - 8,84238,624 - 47,466154,876 Unrestricted (95,049)(18,724)139,646 - - 25,873(51,750) Total net assets $1,181,833($18,724)$187,836($319,051)$0$1,031,894$958,081 Totals 141 CITY OF COLUMBIA HEIGHTS, MINNESOTA STORM SEWER UTILITY FUND Statement 46 SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For Year Ended December 31, 2010 With Comparative Totals for Year Ended December 31, 2009 Operating Account Capital Equipment Replacement Account Capital Construction Account Debt Service Account Intrafund Eliminations 20102009 Operating revenues: Storm sewer service charges$342,820$ - $ - $ - $ - $342,820$367,093 Operating expenses: Collection 183,660 - - - - 183,660153,826 Administration 1,444 - - - - 1,4441,199 Operating expenses - - 964 - - 964128,361 Depreciation 74,330 - - - - 74,33074,330 Total operating expenses259,434 0 964 0 0260,398357,716 Net income (loss) from operations83,386 0(964)0 082,4229,377 Nonoperating revenues (expenses): Investment income: Interest and dividends - - 4,200400 - 4,6006,000 Change in fair value - - (1,000)(100) - (1,100)(1,700) Miscellaneous revenues 2,266 - - - - 2,2663,497 Interest and fiscal charges - - - (14,375) - (14,375)(20,367) Total nonoperating revenues (expenses)2,266 0 3,200 (14,075)0 (8,609)(12,570) Net income (loss) before transfers85,652 0 2,236 (14,075)0 73,813 (3,193) Transfers in - 5,000 96543,000(48,965) - - Transfers out (48,965) - - - 48,965 - (1,000) Total transfers (48,965)5,000 965 43,000 0 0 (1,000) Change in net assets 36,687 5,000 3,201 28,925 0 73,813 (4,193) Net assets - January 1 1,145,146(23,724)184,635(347,976) - 958,081962,274 Net assets - December 31 $1,181,833($18,724)$187,836($319,051)$0$1,031,894$958,081 Totals 142 CITY OF COLUMBIA HEIGHTS, MINNESOTA STORM SEWER UTILITY FUND Statement 47 SUBCOMBINING SCHEDULE OF CASH FLOWS For Year Ended December 31, 2010 With Comparative Totals for Year Ended December 31, 2009 2010 2009 Cash flows from operating activities: Cash received from customers $341,895 $367,892 Cash paid to suppliers for goods and services (129,707)(133,794) Cash payments to employees for services (101,250)(109,549) Net cash flows provided by (used in) operating activities 110,938 124,549 Cash flows from noncapital financing activities: Transfers out - (1,000) Interfund payable (repaid to) advanced by other funds - (39,680) Net cash flows provided by (used in) noncapital financing activities:0 (40,680) Cash flows from capital and related financing activities: Acquisition of capital assets (39,348) - Proceeds from sale of capital assets - - Principal payments - bonds (138,582)(130,431) Interest and fiscal charges (16,745)(22,508) Net cash flows provided by (used in) capital and related financing activities (194,675)(152,939) Cash flows from investing activities: Investment income: ddiiddInterest and dividends 4,500 7,210 Change in fair value (1,100)(1,700) Net cash flows provided by (used in) investing activities 3,400 5,510 Net increase (decrease) in cash and cash equivalents (80,337)(63,560) Cash and cash equivalents - January 1 86,394 149,954 Cash and cash equivalents - December 31 $6,057 $86,394 Reconciliation of operating income to net cash flows from operating activities: Operating income $82,422 $9,377 Adjustments to reconcile operating income to net cash flows from operating activities: Depreciation expense 74,330 74,330 Miscellaneous revenue 2,266 3,497 Changes in assets and liabilities: (Increase) decrease in accounts receivable (3,191)(2,698) Increase (decrease) in accounts payable 2,083 (4) Increase (decrease) in accrued salaries and withholdings payable 1,333 (4,457) Increase (decrease) in due to other governmental units (48,401)48,401 Increase (decrease) compensated absences payable 96 (3,897) Total adjustments 28,516 115,172 Net cash flows provided by (used in) operating activities $110,938 $124,549 143 - This page intentionally left blank - 144 CITY OF COLUMBIA HEIGHTS, MINNESOTA LIQUOR FUND Statement 48 SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2010 With Comparative Totals for December 31, 2009 OperatingDebt ServiceIntrafund Totals AccountAccountEliminations20102009 Assets Current assets: Cash and cash equivalents $7,000$ - $ - $7,000$149,872 Cash and cash equivalents with fiscal agent - 399,254 - 399,254408,632 Receivables: Accounts (net of allowance for uncollectables 416 - - 416 478 Interest - 300 - 300 - Interfund receivable - 257,346(257,346) - - Due from other governmental units 1,691 - - 1,691 632 Prepayments - 87,529 - 87,52995,366 Inventory - at cost 2,320,615 - - 2,320,6152,134,357 Total current assets 2,329,722744,429(257,346)2,816,8052,789,337 Noncurrent assets: Capital assets: Land 2,006,714 - - 2,006,7142,006,714 Buildings 3,915,062 - - 3,915,0623,915,062 Equipment 375,215 - - 375,215375,215 Construction in progress - - - - - Total capital assets 6,296,991 0 06,296,9916,296,991 Less: accumulated depreciation (524,640) - - (524,640)(376,797) Net capital assets 5,772,351 0 05,772,3515,920,194 Total noncurrent assets 5,772,351 0 05,772,3515,920,194 Total assets 8,102,073744,429(257,346)8,589,1568,709,531 Liabilities Current liabilities: Accounts payable 117,706 - - 117,706365,554 Accrued salaries and withholdings payable 18,490 - - 18,49014,579 Contract payable - retained percentage - - - - 2,290 Due to other governmental units 87,608 - - 87,60881,456 Interfund payable 360,161 - (257,346)102,815 - Accrued interest payable - 106,828 - 106,828109,704 Compensated absences payable - current 8,698 - - 8,6983,202 Bonds payable - current - 150,000 - 150,000140,000 Total current liabilities 592,663256,828(257,346)592,145716,785 Noncurrent liabilities: Compensated absences payable - noncurrent57,345 - - 57,34560,462 Bonds payable - noncurrent - 4,750,000 - 4,750,0004,900,000 Total noncurrent liabilities 57,3454,750,000 04,807,3454,960,462 Total liabilities 650,0085,006,828(257,346)5,399,4905,677,247 Net Assets Invested in capital assets, net of related debt5,772,351(4,413,221) - 1,359,1301,374,810 Restricted for debt service - 150,822 - 150,822162,552 Unrestricted 1,679,714 - - 1,679,7141,494,922 Total net assets $7,452,065($4,262,399)$0$3,189,666$3,032,284 145 CITY OF COLUMBIA HEIGHTS, MINNESOTA LIQUOR FUND SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For Year Ended December 31, 2010 With Comparative Totals for Year Ended December 31, 2009 Operating Accounts Top Heights Top Valu Valu II Liquor Operating revenues: Charges for sales: Liquor $1,386,909$1,189,518 $417,139 Beer 1,486,680 1,483,062 556,581 Wine 550,949 537,821 56,459 Other 185,062 174,465 133,614 Total operating revenues 3,609,600 3,384,866 1,163,793 Operating expenses: Cost of goods sold 2,797,494 2,544,986 878,031 Operating expense 569,251 499,340 179,740 Depreciation 82,515 60,893 4,436 Total operating expenses 3,449,260 3,105,219 1,062,207 Net income from operations $160,340 $279,647 $101,586 Nonoperating revenues (expenses): Investment income: Interest and dividends Change in fair value Miscellaneous expenses Interest and fiscal charges Total nonoperating revenues (expenses) Net income (loss) before transfers Transfers in Transfers out Total transfers Change in net assets Net assets - January 1 Net assets - December 31 146 Statement 49 Total Debt Operating Service Intrafund Totals Accounts Account Eliminations 2010 2009 $2,993,566 $ - $ - $2,993,566 $2,898,453 3,526,323 - - 3,526,323 3,487,830 1,145,229 - - 1,145,229 1,090,908 493,141 - - 493,141 485,693 8,158,259 0 0 8,158,259 7,962,884 6,220,511 - - 6,220,511 6,085,546 1,248,331 - - 1,248,331 1,170,425 147,844 - - 147,844 145,219 7,616,686 0 0 7,616,686 7,401,190 541,573 0 0 541,573 561,694 - 1,505 - 1,505 71 - (400) - (400) - - - - - (16,509) - (244,672) - (244,672)(247,171) 0 (243,567)0 (243,567)(263,609) 541,573 (243,567)0 298,006 298,085 - 364,000 (364,000) - - (504,624) - 364,000 (140,624)(187,636) (504,624)364,000 0 (140,624)(187,636) 36,949 120,433 0 157,382 110,449 7,415,116 (4,382,832) - 3,032,284 2,921,835 $7,452,065 ($4,262,399)$0 $3,189,666 $3,032,284 147 CITY OF COLUMBIA HEIGHTS, MINNESOTA LIQUOR FUND Statement 50 SUBCOMBINING SCHEDULE OF CASH FLOWS Page 1 of 2 For Year Ended December 31, 2010 With Comparative Amount for Year Ended December 31, 2009 20102009 Cash flows from operating activities: Cash received from customers $8,157,262$7,963,906 Cash paid to suppliers for goods and services (6,977,383)(6,636,890) Cash payments to employees for services (913,123)(887,837) Net cash flows provided by (used in) operating activities 266,756 439,179 Cash flows from noncapital financing activities Interfund payable (repaid to) advanced by other funds 102,815 - Transfers out (140,624)(187,636) Net cash flows provided by (used in) noncapital financing activities (37,809)(187,636) Cash flows from capital and related financing activities: Acquisition of capital assets (2,290)(55,608) Principal payments - bonds (140,000) - Interest and fiscal charges (239,712)(242,306) Net cash flows provided by (used in) capital and related financing activities (382,002)(297,914) Cash flows from investing activities: Investment income: Interest and dividends 1,205 841Interest and dividends 1,205 841 Change in fair value (400) - Net cash flows provided by (used in) investing activities 805 841 Net increase (decrease) in cash and cash equivalents (152,250)(45,530) Total cash and cash equivalents - January 1 558,504 604,034 Total cash and cash equivalents - December 31 406,254 558,504 (Less) cash and cash equivalents with fiscal agent - December 31 (399,254)(408,632) Cash and cash equivalents - December 31 $7,000 $149,872 148 CITY OF COLUMBIA HEIGHTS, MINNESOTA LIQUOR FUND Statement 50 SUBCOMBINING SCHEDULE OF CASH FLOWS Page 2 of 2 For Year Ended December 31, 2010 With Comparative Amount for Year Ended December 31, 2009 20102009 Reconciliation of operating income to net cash flows from operating activities: Operating income $541,573$561,694 Adjustments to reconcile operating income to net cash flows from operating activities: Depreciation expense 147,844 145,219 Miscellaneous expense - (16,509) Changes in assets and liabilities: (Increase) decrease in accounts receivable 62 9 (Increase) decrease in due from other governmental units (1,059)1,013 (Increase) decrease in prepayments 7,837 8,052 AAdjustment for nonoperating portion (7,837)(8,052) (Increase) decrease in inventory, at cost (186,258)(341,960) Increase (decrease) in accounts payable (247,848)121,540 AAdjustment for nonoperating portion - - Increase (decrease) in accrued salaries and withholdings payable 3,911 (29,537) Adjustment for nonoperating portion - - Increase (decrease) in contracts payable - retained percentage (2,290)2,290 Adjustment for nonoperating portion 2,290 (2,290)Adjustment for nonoperating portion 2,290 (2,290) Increase (decrease) in due to other governmental units 6,152 4,763 Increase (decrease) in compensated absences payable 2,379 (7,053) Total adjustments (274,817)(122,515) Net cash flows provided by (used in) operating activities $266,756 $439,179 Noncash capital and related financing activities: Capital assets purchased/constructed on account $ - $2,290 149 - This page intentionally left blank - 150 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. Information Systems Fund – used to account for the costs associated with information systems within the City. All costs are recorded in the fund and are financed by transfers from 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 premiums, claims and claims administration are recorded in the fund and allocated to user funds based on a percentage risk factor. Compensated Absences Fund – used to account for funds that have been set aside by the City Council for compensated absences earned by employees’ services to the City’s governmental funds. Funds set aside for the compensated absences earned by employees’ services to the City’s proprietary funds are recorded directly in each particular proprietary fund. 151 CITY OF COLUMBIA HEIGHTS, MINNESOTA INTERNAL SERVICE FUNDS Statement 51 COMBINING STATEMENT OF NET ASSETS December 31, 2010 Central Garage Information SystemsInsurance Compensated Absences Total Internal Service Funds Assets Current assets: Cash and cash equivalents $498,190$649,510$761,559$927,508$2,836,767 Interest receivable 1,6002,7002,800 - 7,100 Prepayments - - 50,470 - 50,470 Inventory - at cost 39,022 - - - 39,022 Total current assets 538,812652,210814,829927,5082,933,359 Noncurrent assets: Capital assets: Land 15,779 - - - 15,779 Buildings 1,585,993 - - - 1,585,993 Equipment 198,911154,597 - - 353,508 Total capital assets 1,800,683154,597 0 01,955,280 Less: accumulated depreciation (683,458)(113,498) - - (796,956) Net capital assets 1,117,22541,099 0 01,158,324 Total noncurrent assets 1,117,22541,099 0 01,158,324 Total assets 1,656,037 693,309 814,829 927,508 4,091,683 Liabilities Current liabilities: Accounts payable 28,352 649 - - 29,001 Accrued salaries and withholdings payable 3,8074,205 - - 8,012 Compensated absences payable - current 3,5491,756 - 110,598115,903 Total current liabilities 35,708 6,610 0 110,598 152,916 Noncurrent liabilities: Compensated absences payable - noncurrent23,39911,580 - 729,177764,156 Total liabilities 59,107 18,190 0 839,775 917,072 Net Assets Invested in capital assets, net of related debt1,117,22541,099 - - 1,158,324 Unrestricted 479,705634,020814,82987,7332,016,287 Total net assets $1,596,930$675,119$814,829$87,733$3,174,611 152 CITY OF COLUMBIA HEIGHTS, MINNESOTA INTERNAL SERVICE FUNDS Statement 52 COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For The Year Ended December 31, 2010 Central Garage Information SystemsInsurance Compensated Absences Interfund Eliminations Total Internal Service Funds Operating revenues: Charges for services: Services to departments$195,050$ - $485,964$ - $ - $681,014 Use of space265,694 - - - - 265,694 Recovery of damages - - 12,989 - - 12,989 Charges for sales: Sales of motor fuel161,534 - - - - 161,534 Total operating revenues622,278 0 498,953 0 0 1,121,231 Operating expenses: Cost of services and space512,734288,649447,446 - - 1,248,829 Depreciation49,24021,320 - - - 70,560 Total operating expenses561,974 309,969 447,446 0 0 1,319,389 Net income (loss) from operations60,304(309,969)51,50700(198,158) Nonoperating revenues: Investment income: Interest and dividends8,90014,90015,200 - - 39,000 Change in fair value(2,100)(3,600)(3,700) - - (9,400) Total nonoperating revenues6,800 11,300 11,500 0 0 29,600 Net income (loss) before transfers67,104 (298,669)63,007 0 0(168,558) Transfers in42,000223,790 - - (25,000)240,790 Transfers out(61,250) - - - 25,000(36,250) Total transfers and capital contributions(19,250)223,790 0 0 0 204,540 Change in net assets47,854 (74,879)63,007 0 035,982 Net assets - January 11,549,076749,998751,82287,733 - 3,138,629 Net assets - December 31$1,596,930 $675,119 $814,829 $87,733 $0 $3,174,611 153 CITY OF COLUMBIA HEIGHTS, MINNESOTA INTERNAL SERVICE FUNDS Statement 53 COMBINING STATEMENT OF CASH FLOWS For The Year Ended December 31, 2010 Central Garage Information SystemsInsurance Compensated Absences Total Internal Service Funds Cash flows from operating activities: Cash received from interfund goods and services provided $622,278$ - $485,964$681,942$1,790,184 Cash received for damages - - 12,989 - 12,989 Cash paid to suppliers for goods and services (330,064)(73,578)(445,482) - (849,124) Cash payments to employees for services (190,315)(218,080) - (582,647)(991,042) Net cash flows provided by (used in) operating activities 101,899(291,658)53,471 99,295 (36,993) Cash flows from noncapital financing activities: Intergovernmental - - - - - Transfers in 42,000223,790 - - 265,790 Transfers out (61,250) - - - (61,250) Net cash flows provided by (used in) noncapital financing activities (19,250)223,790 0 0 204,540 Cash flows from capital and related financing activities: Acquisition of capital assets - - - - - Net cash flows provided by (used in) capital and related financing activities 0 0 0 0 0 Cash flows from investing activities: Investment income: Interest and dividends 8,700 14,800 14,800 - 38,300 Change in fair value (2,100)(3,600)(3,700) - (9,400) Net cash flows provided by (used in) investing activities 6,600 11,200 11,100 0 28,900 Net increase (decrease) in cash and cash equivalents 89,249 (56,668)64,571 99,295 196,447 Cash and cash equivalents - January 1 408,941706,178696,988828,2132,640,320 Cash and cash equivalents - December 31 $498,190 $649,510 $761,559 $927,508 $2,836,767 Reconciliation of operating income (loss) to net cash flows from operating activities: Operating income (loss)$60,304($309,969)$51,507$ - ($198,158) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation expense 49,240 21,320 - - 70,560 Changes in assets and liabilities: (Increase) decrease in prepayments - - 5,370 - 5,370 (Increase) decrease in inventory, at cost (2,226) - - - (2,226) Increase (decrease) in accounts payable (10,264)(7,890)(3,406) - (21,560) Increase (decrease) in accrued - salaries and withholdings payable 1,053 1,331 - - 2,384 Increase (decrease) in compensated absences payable 3,792 3,550 - 99,295106,637 Total adjustments 41,595 18,311 1,964 99,295 161,165 Net cash flows provided by (used in) operating activities $101,899($291,658)$53,471$99,295($36,993) Noncash capital and related financing activities: Contribution of capital assets from government $ - $ - $ - $ - $ - 154 CITY OF COLUMBIA HEIGHTS, MINNESOTA CENTRAL GARAGE FUND Statement 54 SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2010 With Comparative Totals For December 31, 2009 Capital Equipment OperatingReplacementTotals AccountAccount20102009 Assets Current assets: Cash and cash equivalents $471,354$26,836$498,190$408,941 Interest receivable 1,500 100 1,600 1,400 Inventory - at cost 39,022 - 39,02236,796 Total current assets 511,87626,936538,812447,137 Noncurrent assets: Capital assets: Land 15,779 - 15,77915,779 Buildings 1,585,993 - 1,585,9931,585,993 Equipment 198,911 - 198,911198,911 Construction in progress - - - - Total capital assets 1,800,683 01,800,6831,800,683 Less: Accumulated depreciation (683,458) - (683,458)(634,218) Net capital assets 1,117,225 01,117,2251,166,465 Total noncurrent assets 1,117,225 01,117,2251,166,465 Total assets 1,629,10126,9361,656,0371,613,602 Liabilities Current liabilities: Accounts payable 28,352 - 28,35238,616 Accrued salaries and withholdings payable 3,807 - 3,807 2,754 Compensated absences payable - current 3,549 - 3,549 1,165 Total current liabilities 35,708 0 35,708 42,535 Noncurrent liabilities: Compensated absences payable - noncurrent 23,399 - 23,39921,991 Total liabilities 59,107 0 59,107 64,526 Net Assets Invested in capital assets, net of related debt 1,117,225 - 1,117,2251,166,465 Unrestricted 452,76926,936479,705382,611 Total net assets $1,569,994$26,936$1,596,930$1,549,076 155 CITY OF COLUMBIA HEIGHTS, MINNESOTA CENTRAL GARAGE FUND Statement 55 SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For The Year Ended December 31, 2010 With Comparative Totals For The Year Ended December 31, 2009 Capital Equipment OperatingReplacementIntrafund Totals AccountAccountEliminations2010 2009 Operating revenues: Charges for services: Services to departments $195,050$ - $ - $195,050$172,485 Use of space 265,694 - - 265,694258,941 Charges for sales: Sales of motor fuel 161,534 - - 161,534105,979 Total operating revenues 622,278 0 0 622,278537,405 Operating expenses: Cost of services and space 512,734 - - 512,734460,599 Depreciation 49,240 - - 49,24048,207 Total operating expenses 561,974 0 0 561,974508,806 Net income from operations 60,304 - 0 60,30428,599 Nonoperating revenues: Investment income: Interest and dividends 8,400 500 - 8,90010,000 Change in fair value (2,000)(100) - (2,100)(2,900) Intergovernmental - - - - 20,676 Total nonoperating revenues 6,400 400 0 6,80027,776 Net income before capital contributions and transfers 66,704 400 067,104 56,375 Capital contribution - capital asset - - - - 15,779 Transfers in 42,000 4,000(4,000)42,000 - Transfers out (65,250) - 4,000(61,250)(61,250) Total transfers (23,250)4,000 0 (19,250)(45,471) Change in net assets 43,454 4,400 0 47,854 10,904 Total net assets - January 1 1,526,54022,536 - 1,549,0761,538,172 Total net assets - December 31 $1,569,994 $26,936 $0 $1,596,930 $1,549,076 156 CITY OF COLUMBIA HEIGHTS, MINNESOTA CENTRAL GARAGE FUND Statement 56 SUBCOMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31, 2010 With Comparative Totals For The Year Ended December 31, 2009 2010 2009 Cash flows from operating activities: Cash received from interfund goods & services provided $622,278 $537,405 Cash paid to suppliers for goods and services (330,064)(263,765) Cash payments to employees for services (190,315)(179,266) Net cash flows provided by (used in) operating activities 101,899 94,374 Cash flows from noncapital financing activities: Intergovernmental - 20,676 Transfers in 42,000 - Transfers out (61,250)(61,250) Net cash flows provided by (used in) noncapital financing activities:(19,250)(40,574) Cash flows from capital and related financing activities: Acquisition of capital assets - (39,782) Cash flows from investing activities: Investment income: Interest and dividends 8,700 11,540 Change in fair value (2,100)(2,900) Net cash flows provided by (used in) investing activities 6,600 8,640Net cash flows provided by (used in) investing activities 6,600 8,640 Net increase (decrease) in cash and cash equivalents 89,249 22,658 Cash and cash equivalents - January 1 408,941 386,283 Cash and cash equivalents - December 31 $498,190 $408,941 Reconciliation of operating income to net cash flows from operating activities: Operating income $60,304 $28,599 Adjustments to reconcile operating income to net cash flows from operating activities: Depreciation expense 49,240 48,207 Changes in assets and liabilities: (Increase) decrease in inventory, at cost (2,226)(3,023) Increase (decrease) in accounts payable (10,264)25,631 Increase (decrease) in accrued salaries and withholdings payable 1,053 (5,021) Increase (decrease) in compensated absences payable 3,792 (19) Total adjustments 41,595 65,775 Net cash flows provided by (used in) operating activities $101,899 $94,374 Noncash capital and related financing activities: Contribution of capital assets from government $0 $15,779 157 CITY OF COLUMBIA HEIGHTS, MINNESOTA INFORMATION SYSTEMS FUND Statement 57 SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2010 With Comparative Totals For December 31, 2009 Capital Equipment Operating Replacement Totals AccountAccount 2010 2009 Assets Current assets: Cash and cash equivalents $114,510$535,000$649,510$706,178 Interest receivable 2,700 - 2,700 2,600 Total current assets 117,210535,000652,210708,778 Noncurrent assets: Capital assets: Equipment 154,597 - 154,597154,597 Less: accumulated depreciation (113,498) - (113,498)(92,178) Net capital assets 41,099 - 41,099 62,419 Total noncurrent assets 41,099 0 41,099 62,419 Total assets 158,309535,000693,309771,197 Liabilities Current liabilities: Accounts payable 649 - 649 8,539 Accrued salaries and withholdings payable 4,205 - 4,205 2,874 Compensated absences payable - current 1,756 - 1,756 492 Total current liabilities 6,610 0 6,610 11,905 Noncurrent liabilities: Compensated absences payable - noncurrent 11,580 - 11,580 9,294 Total liabilities 18,190 0 18,190 21,199 Net Assets Invested in capital assets, net of related debt 41,099 - 41,099 62,419 Unrestricted 99,020535,000634,020687,579 Total net assets $140,119 $535,000 $675,119 $749,998 158 CITY OF COLUMBIA HEIGHTS, MINNESOTA INFORMATION SYSTEMS FUND Statement 58 SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For The Year Ended December 31, 2010 With Comparative Totals For The Year Ended December 31, 2009 Capital Equipment OperatingReplacementIntrafund Totals AccountAccountEliminations2010 2009 Operating revenues $ - $ - $ - $ - $ - Operating expenses: Cost of services 288,649 - - 288,649233,870 Depreciation 21,320 - - 21,32021,014 Total operating expenses 309,969 0 0309,969254,884 Net income (loss) from operations (309,969)0 0(309,969)(254,884) Nonoperating revenues: Investment income: Interest and dividends 14,900 - - 14,90018,800 Change in fair value (3,600) - - (3,600)(5,400) Total nonoperating revenues 11,300 0 011,30013,400 Net income (loss) before transfers (298,669)0 0 (298,669)(241,484) Transfers in 223,790535,000(535,000)223,790240,000 Transfers out (535,000) - 535,000 - - Total transfers (311,210)535,000 0223,790240,000 Change in net assets (609,879)535,000 0 (74,879)(1,484) Net assets - January 1 749,998 - - 749,998751,482 Net assets - December 31 $140,119 $535,000 $0 $675,119 $749,998 159 CITY OF COLUMBIA HEIGHTS, MINNESOTA INFORMATION SYSTEMS FUND Statement 59 SUBCOMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31, 2010 With Comparative Totals For The Year Ended December 31, 2009 2010 2009 Cash flows from operating activities: Cash paid to suppliers for goods and services ($73,578)($66,124) Cash payments to employees for services (218,080)(191,496) Net cash flows provided by (used in) operating activities (291,658)(257,620) Cash flows from noncapital financing activities: Transfers in 223,790 240,000 Cash flows from capital and related financing activities: Acquisition of capital assets - (35,449) Cash flows from investing activities: Investment income: Interest and dividends 14,800 22,170 Change in fair value (3,600)(5,400) Net cash flows provided by (used in) investing activities 11,200 16,770 Net increase in cash and cash equivalents (56,668)(36,299) Cash and cash equivalents - January 1 706,178 742,477Cash and cash equivalents January 1 706,178 742,477 Cash and cash equivalents - December 31 $649,510 $706,178 Reconciliation of operating income (loss) to net cash flows from operating activities: Operating income (loss)($309,969)($254,884) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation expense 21,320 21,014 Changes in assets and liabilities: Increase (decrease) in accounts payable (7,890)(19,700) Increase (decrease) in accrued salaries and withholdings payable 1,331 (5,488) Increase (decrease) in compensated absences payable 3,550 1,438 Total adjustments 18,311 (2,736) Net cash flows provided by (used in) operating activities ($291,658)($257,620) 160 CITY OF COLUMBIA HEIGHTS, MINNESOTA INSURANCE FUND Statement 60 SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2010 With Comparative Totals For December 31, 2009 20102009 Assets Current assets: Cash and cash equivalents $761,559 $696,988 Interest receivable 2,800 2,400 Prepayments 50,470 55,840 Total assets 814,829 755,228 Liabilities Current liabilities: Accounts payable - 3,406 Total liabilities 0 3,406 Net Assets Unrestricted 814,829 751,822 Total net assets $814,829 $751,822 161 CITY OF COLUMBIA HEIGHTS, MINNESOTA INSURANCE FUND Statement 61 SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For The Year Ended December 31, 2010 With Comparative Totals For The Year Ended December 31, 2009 20102009 Operating revenues: Insurance allocation$485,964$505,826 Recovery of damages12,98930,821 Total operating revenues 498,953 536,647 Operating expenses: Cost of services: Premiums 432,376 463,883 Claims 15,070 23,140 Total operating expenses 447,446 487,023 Net income (loss) from operations 51,507 49,624 Nonoperating revenues: Investment income: Interest and dividends 15,200 17,000 Change in fair value (3,700)(4,900) Total nonoperating revenues 11,500 12,100 Net income before transfers 63,007 61,724 Transfers out - (13,767) Change in net assets 63,007 47,957 Net assets - January 1 751,822 703,865 Net assets - December 31 $814,829 $751,822 162 CITY OF COLUMBIA HEIGHTS, MINNESOTA INSURANCE FUND Statement 62 SUBCOMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31, 2010 With Comparative Totals For The Year Ended December 31, 2009 2010 2009 Cash flows from operating activities: Cash received from interfund services provided $485,964 $505,826 Cash received for damages 12,989 30,821 Cash paid to suppliers for goods and services (445,482)(477,395) Net cash flows provided by (used in) operating activities 53,471 59,252 Cash flows from noncapital financing activities: Transfers out - (13,767) Cash flows from investing activities: Investment income: Interest and dividends 14,800 19,750 Change in fair value (3,700)(4,900) Net cash flows provided by (used in) investing activities 11,100 14,850 Net increase in cash and cash equivalents 64,571 60,335 Cash and cash equivalents - January 1 696,988 636,653 Cash and cash equivalents - December 31 $761,559 $696,988 Cash and cash equivalents December 31 $761,559 $696,988 Reconciliation of operating income (loss) to net cash flows from operating activities: Operating income (loss)$51,507 $49,624 Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Changes in assets and liabilities: (Increase) decrease in prepayments 5,370 6,971 Increase (decrease) in accounts payable (3,406)2,657 Total adjustments 1,964 9,628 Net cash flows provided by (used in) operating activities $53,471 $59,252 163 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMPENSATED ABSENCES FUND Statement 63 SUBCOMBINING SCHEDULE OF NET ASSETS December 31, 2010 With Comparative Totals For December 31, 2009 2010 2009 Assets Current assets: Cash and cash equivalents $927,508 $828,213 Interest receivable - - Total assets 927,508 828,213 Liabilities Current liabilities: Compensated absences payable - current 110,598 37,246 Noncurrent liabilities: Compensated absences payable - noncurrent 729,177 703,234 Total liabilities 839,775 740,480 Net Assets Unrestricted 87,733 87,733 Total net assets $87,733 $87,733 164 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMPENSATED ABSENCES FUND Statement 64 SUBCOMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS For The Year Ended December 31, 2010 With Comparative Totals For The Year Ended December 31, 2009 2010 2009 Operating revenues: Charges for services $ - $ - Operating expenses: Personal services - - Net income (loss) from operations 0 0 Nonoperating revenues: Investment income: Interest and dividends - - Change in fair value - - Total nonoperating revenues 0 0 Change in net assets 00 Net assets - January 1 87,733 87,733 Net assets - December 31 $87,733 $87,733 165 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMPENSATED ABSENCES FUND Statement 65 SUBCOMBINING SCHEDULE OF CASH FLOWS For The Year Ended December 31, 2010 With Comparative Totals For The Year Ended December 31, 2009 2010 2009 Cash flows from operating activities: Cash received from interfund services provided $681,942 $616,632 Cash payments to employees for services (582,647)(625,420) Net cash flows provided by (used in) operating activities 99,295 (8,788) Cash flows from investing activities: Investment income: Interest and dividends - 6,130 Change in fair value - - Net cash flows provided by (used in) investing activities 0 6,130 Net increase in cash and cash equivalents 99,295 (2,658) Cash and cash equivalents - January 1 828,213 830,871 Cash and cash equivalents - December 31 $927,508 $828,213 Reconciliation of operating income (loss) to net cash flows from operating activities: Operatingincome(loss)$-$-Operating income (loss)$ $ Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Changes in assets and liabilities: Increase (decrease) in compensated absences payable99,295(8,788) Total adjustments99,295(8,788) Net cash flows provided by (used in) operating activities$99,295($8,788) 166 AGENCY FUNDS 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 Agency Funds during the year: Permit Surcharge Fund – used to account for building permit surcharges collected for and remitted to the State of Minnesota, and sewer availability charges (SAC) collected for and remitted to the Metropolitan Council. Tri-City GIS Fund – used to account for joint purchases of geographic information services by the Cities of Columbia Heights, Fridley and Andover. 167 CITY OF COLUMBIA HEIGHTS, MINNESOTA COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES Statement 66 AGENCY FUNDS For The Year Ended December 31, 2010 Balance Balance January 1,December 31, 2010 AdditionsDeletions 2010 Permit Surcharge Fund Assets: Cash and investments $757$91,670($90,399)$2,028 Total assets $757$91,670($90,399)$2,028 Liabilities: Due to other governmental units $757$91,670($90,399)$2,028 Total liabilities $757$91,670($90,399)$2,028 Tri-City GIS Fund Assets: Cash and investments $1,753$75,199($72,266)$4,686 Due from other governmental units 8,533 53,179 (61,516)196 Total assets $1,753$75,199($72,266)$4,882 Liabilities: Accounts payable $8,559$68,464($72,266)$4,757 Due to other governmental units 1,727 59,915 (61,517)125 Total liabilities $10,286$128,379($133,783)$4,882 Total Assets: Cash and investments $2,510$166,869($162,665)$6,714 Due from other governmental units 8,533 53,179 (61,516)196 Total assets $11,043$220,048($224,181)$6,910 Liabilities: Accounts payable $8,559$68,464($72,266)$4,757 Due to other governmental units 2,484151,585(151,916)2,153 Total liabilities $11,043$220,049($224,182)$6,910 168 III. STATISTICAL SECTION (UNAUDITED) 169 - This page intentionally left blank - 170 STATISTICAL SECTION The following detailed statistical tables are presented to provide a context for understanding and evaluating the information presented in the other parts of this report. Unless otherwise noted, the information in these statistical tables is derived from the City of Columbia Heights’ Comprehensive Annual Financial Reports for the relevant years. Certain information in prior years’ presentations have been reclassified and/or adjusted in these tables to conform to the current year presentation. These tables address the five categories of information listed below. Financial Trends - Tables 1 through 4 These tables contain trend information to help the reader understand how the City’s financial performance has changed over time. Revenue Capacity - Tables 5 through 8 These tables contain information to help the reader assess the factors affecting the City’s ability to generate property taxes. Debt Capacity - Tables 9 through 13 These tables contain present information to help the reader assess the affordability of the City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future. Demographic and Economic Information - Tables 14 and 15 These tables offer demographic and economic indicators to help the reader understand the environment within which the City’s financial activities take place and to help make comparisons over time and with other governments. Operating Information - Tables 16 through 18 These tables contain information about the City’s operations and resources to help the reader understand the relationship between the City’s financial activities and the services the City provides. 171 CITY OF COLUMBIA HEIGHTS, MINNESOTA NET ASSETS BY COMPONENT Last Nine Fiscal Years (A) (Accrual Basis of Accounting) 200220032004 Governmental activities: Invested in capital assets, net of related debt $15,022,274$14,535,589$14,328,916 Restricted 1,203,523 1,114,870 2,285,305 Unrestricted 16,904,724 18,169,133 20,455,981 Total governmental activities net assets $33,130,521$33,819,592$37,070,202 Business-type activities: Invested in capital assets, net of related debt $5,473,625 $5,432,788 $6,175,547 Restricted 175,783 290,175 337,389 Unrestricted 7,658,623 7,325,228 6,918,745 Total business-type activities net assets $13,308,031$13,048,191$13,431,681 Primary government: Invested in capital assets, net of related debt $20,495,899$19,968,377$20,504,463 Restricted 1,379,306 1,405,045 2,622,694 Unrestricted 24,563,347 25,494,361 27,374,726 Total primary government net assets $46,438,552$46,867,783$50,501,883 Fiscal Year (A) Net asset information is not available for years prior to 2002; the year the City implemented GASB Statement 34. 172 Table 1 200520062007200820092010 $16,727,724$18,043,277$18,859,030$23,497,922$24,163,911$26,279,178 2,302,0562,224,3842,228,4542,316,9592,458,7432,034,030 18,650,98123,028,97422,985,52321,011,46522,423,35123,142,534 $37,680,761$43,296,635$44,073,007$46,826,346$49,046,005$51,455,742 $6,732,499$5,759,805$6,039,739$7,142,278$7,459,474$8,044,184 375,652 455,227 775,036 745,601 648,435 438,275 6,506,2017,299,5746,478,3835,855,4956,014,1406,725,383 $13,614,352$13,514,606$13,293,158$13,743,374$14,122,049$15,207,842 $23,460,223$23,803,082$24,898,769$30,640,200$31,623,385$34,323,362 2,677,7082,679,6113,003,4903,062,5603,107,1782,472,305 25,157,18230,328,54829,463,90626,866,96028,437,49129,867,917 $51,295,113$56,811,241$57,366,165$60,569,720$63,168,054$66,663,584 Fiscal Year 173 CITY OF COLUMBIA HEIGHTS, MINNESOTA CHANGES IN NET ASSETS Last Nine Fiscal Years (A) (Accrual Basis of Accounting) 200220032004 Expenses Governmental activities: General government $1,915,920$1,756,434$1,669,721 Public safety 3,920,7463,630,5353,640,970 Public works 1,659,1522,646,8592,109,060 Culture and recreation 2,018,5711,909,8311,904,848 Community development 1,679,1071,239,0302,171,407 Interest on long-term debt 575,712414,297 387,544 Total governmental activities expenses 11,769,20811,596,98611,883,550 Business-type activities: Water 1,561,0711,903,3311,637,316 Sewer 1,058,7211,231,5941,219,200 Refuse 1,271,9611,330,2721,321,730 Storm sewer 162,499204,895 158,374 Liquor 6,343,7756,619,9426,593,578 Total business-type activities expenses 10,398,02711,290,03410,930,198 Total primary government expenses $22,167,235$22,887,020$22,813,748 Program revenues Governmental activities: Chargesforservices: Fiscal Year Charges for services: General government $594,983$724,331$203,344 Public safety 290,465330,768 488,216 Public works 168,608306,193 48,253 Culture and recreation 233,498107,318 239,352 Community development 501,288510,6201,313,912 Operating grants and contributions: General government 2,688 - - Public safety 387,828405,098 436,460 Public works 161,384194,987 213,801 Culture and recreation 140,938 41,492 72,269 Community development 525,821304,669 955,213 Capital grants and contributions: General government - - - Public safety - 225,000 225,000 Public works - 613,3041,315,007 Culture and recreation 4,043,856 - 50,250 Community development 466,373 56,805 177,737 Total governmental activities program revenues 7,517,7303,820,5855,738,814 174 Table 2 Page 1 of 2 2005 2006 2007 2008 2009 2010 $1,681,229$1,689,675$1,732,111$1,835,453$1,761,334$2,013,750 4,052,905 3,992,930 4,380,363 4,599,669 4,591,977 5,473,224 2,391,726 2,353,032 2,506,913 2,906,950 2,794,189 2,777,966 2,017,816 2,135,633 2,313,750 2,283,881 2,182,856 2,479,519 5,360,442 2,579,084 5,918,257 4,476,475 2,385,405 2,295,574 288,532 118,760 496,688 721,006 961,392 959,320 15,792,65012,869,11417,348,08216,823,43414,677,15315,999,353 1,717,445 2,026,603 2,113,121 2,149,976 1,927,811 2,000,101 1,333,420 1,393,679 1,675,738 1,571,487 1,737,134 1,478,518 1,147,313 1,147,879 1,170,707 1,185,298 1,290,528 1,426,486 162,915 184,764 204,221 216,362 376,884 272,355 6,544,175 6,377,805 6,539,357 7,470,323 7,701,961 7,910,951 10,905,26811,130,73011,703,14412,593,44613,034,31813,088,411 $26,697,918$23,999,844$29,051,226$29,416,880$27,711,471$29,087,764 Fiscal Year $228,740 $171,146 $177,378 $173,485 $169,850 $192,005 423,450 528,752 670,017 616,107 637,653 715,205 81,607 267,960 130,351 67,226 34,149 44,211 250,380 263,565 297,341 262,562 256,969 269,825 2,748,542 1,461,497 1,504,679 1,562,345 1,019,191 1,114,848 79 2,769 - 2,560 1,505 - 557,983 355,356 389,325 433,732 434,402 559,482 178,311 161,176 154,309 154,049 161,401 166,468 76,405 79,371 47,784 239,865 102,517 93,474 144,121 160,017 159,624 185,506 211,400 241,919 - - - - - 194,842 599,917 52,463 103,974 57,700 19,520 16,026 46,052 3,896,862 1,448,180 1,596,348 1,683,024 2,848,179 1,702,543 141,738 71,516 42,588 1,500 15,724 - 682,872 1,311,525 2,974,449 199,505 541,826 7,038,130 8,225,544 6,466,003 8,368,522 4,932,586 7,014,034 175 CITY OF COLUMBIA HEIGHTS, MINNESOTA CHANGES IN NET ASSETS Last Nine Fiscal Years (A) (Accrual Basis of Accounting) 200220032004 Business-type activities: Charges for services: Water $ - $1,548,505$1,771,153 Sewer 1,391,6691,240,8821,019,532 Refuse 1,220,9361,248,3461,255,011 Storm sewer 1,248,982184,712 284,223 Liquor 172,9756,960,9166,975,756 Operating grants and contributions:6,883,344 - Sewer 198 1,865 - Refuse 53,780 53,411 46,635 Storm sewer - 52,499 - Capital grants and contributions: Water - - - Sewer - - - Storm sewer 130,339 - 113,407 Total business-type activities program revenues 11,102,22311,291,13611,465,717 Total primary government program revenues $18,619,953$15,111,721$17,204,531 Net (expense) revenue: Governmental activities ($4,251,478)($7,776,401)($6,144,736) Fiscal Year Business-type activities 704,196 1,102 535,519 Total primary government net (expense) revenue (3,547,282)(7,775,299)(5,609,217) General revenues and other changes in net assets Governmental activities: Taxes: Property taxes 4,341,9724,306,0364,989,205 Tax increment collections 798,446781,439 972,208 Unrestricted grants and contributions 3,275,4172,712,4082,337,386 Investment earnings 1,201,447408,208 729,456 Miscellaneous 6,454103,524 - Transfers 734,236487,613 467,091 Total governmental activities 10,357,9728,799,2289,495,346 Business-type activities: Investment earnings 375,624126,671 215,062 Transfers (734,236)(487,613)(467,091) Total business-type activities (358,612)(360,942)(252,029) Total primary government $9,999,360$8,438,286$9,243,317 Change in net assets: Governmental activities $6,006,494$1,022,827$3,350,610 Business-type activities 445,584(359,840)283,490 Total primary government $6,452,078$662,987$3,634,100 (A) Changes in net assets are not available for years prior to 2002; the year the City implemented GASB Statement 34. 176 Table 2 Page 2 of 2 200520062007200820092010 $1,887,990$2,141,648$2,273,980$2,414,316$2,471,257$2,503,506 1,145,810 1,374,217 1,419,252 1,440,165 1,465,496 1,594,322 1,256,180 1,263,267 1,303,472 1,341,014 1,383,979 1,542,312 274,907 270,467 290,419 314,238 370,590 345,086 6,714,575 6,546,979 6,722,622 7,490,942 7,962,884 8,158,259 - - - 1,718 - - 46,170 47,755 36,060 50,572 50,105 36,653 - - - - - - - 22,822 - - - - - - - 54,774 - - - - - - - - 11,325,63211,667,15512,045,80513,107,73913,704,31114,180,138 $18,363,762$19,892,699$18,511,808$21,476,261$18,636,897$21,194,172 ($8,754,520)($4,643,570)($10,882,079)($8,454,912)($9,744,567)($8,985,319) Fiscal Year 420,364 536,425 342,661 514,293 669,993 1,091,727 (8,334,156)(4,107,145)(10,539,418)(7,940,619)(9,074,574)(7,893,592) 5,662,368 5,953,722 6,321,467 6,762,129 8,046,318 8,825,502 1,088,267 1,086,298 1,183,062 1,557,891 1,244,684 812,965 1,768,216 1,679,384 1,844,516 1,516,412 1,731,185 1,176,934 471,142 706,231 1,379,726 1,050,827 475,345 487,611 18,980 15,930 44,000 40,877 82,704 - 445,249 957,879 456,537 280,115 383,990 92,044 9,454,22210,399,44411,229,30811,208,25111,964,22611,395,056 118,413 181,708 321,571 216,038 92,672 86,110 (445,249)(957,879)(456,537)(280,115)(383,990)(92,044) (326,836)(776,171)(134,966)(64,077)(291,318)(5,934) $9,127,386$9,623,273$11,094,342$11,144,174$11,672,908$11,389,122 $699,702$5,755,874 $347,229$2,753,339$2,219,659$2,409,737 93,528 (239,746)207,695 450,216 378,675 1,085,793 $793,230$5,516,128 $554,924$3,203,555$2,598,334$3,495,530 177 CITY OF COLUMBIA HEIGHTS, MINNESOTA FUND BALANCES - GOVERNMENTAL FUNDS Last Ten Fiscal Years (Modified Accrual Basis of Accounting) 2001 2002 2003 2004 General fund: Reserved $7,003$14,657$14,727 $23,302 Unreserved 3,890,3733,500,9493,408,5054,116,808 Total general fund $3,897,376$3,515,606$3,423,232$4,140,110 All other governmental funds: Reserved $951,121$950,813$976,139$5,273,705 Unreserved, reported in: Special revenue funds 3,190,810355,626610,804(652,449) Debt service funds 1,710,7161,187,646841,6661,044,647 Capital projects funds 7,688,86511,938,61113,633,28412,367,589 Total all other governmental funds $13,541,512$14,432,696$16,061,893$18,033,492 Fiscal Year 178 Table 3 200520062007200820092010 $10,484$35,323$35,710$12,159$71,898$77,204 3,339,6443,560,5253,943,4363,743,7984,724,2535,265,035 $3,350,128$3,595,848$3,979,146$3,755,957$4,796,151$5,342,239 $2,187,884$2,668,322$2,382,354$968,602$1,643,915$1,550,071 (612,434)(506,084)411,0901,868,3402,332,6103,190,618 621,250809,0621,745,4473,242,4713,177,5863,713,774 12,784,74415,034,96815,918,04820,233,69013,173,07411,642,407 $14,981,444$18,006,268$20,456,939$26,313,103$20,327,185$20,096,870 Fiscal Year 179 CITY OF COLUMBIA HEIGHTS, MINNESOTA CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS Last Ten Fiscal Years 2001 2002 2003 2004 Revenues: Taxes $4,878,197$5,143,733$5,076,498$5,937,431 Special assessments 628,222 597,380 564,351671,357 Licenses and permits 292,744 277,924 281,480586,957 Intergovernmental 6,597,6507,996,9923,844,9884,687,866 Charges for services 1,191,1651,166,8761,125,4311,442,438 Fines and forfeitures 87,760 84,346 140,378140,282 Investment earnings 987,6431,201,447 392,995695,275 Other revenues 1,469,836 327,771 435,829176,575 Total revenues 16,133,217 16,796,469 11,861,950 14,338,181 Expenditures: Current: General government 1,876,9961,663,8011,576,233 Public safety 3,829,1783,590,5253,615,200 Public works 1,162,9961,208,0551,311,390 Culture and recreation 1,897,6901,862,7771,872,178 Community development 1,545,4051,622,4681,576,161 Capital outlay: Fiscal Year Capital outlay: General government 20,778 16,037 - Public safety 124,648 348,221476,511 Public works 5,296,2011,273,7471,637,559 Culture and recreation 26,610 71,700 83,955 Community development 257,425 55,824682,939 Debt service: Principal retirement 716,515 477,918514,789 Interest and fiscal charges 561,222 602,592652,518 Issuance costs - 10,330 29,918 Developer incentives 104,258 85,211 67,866 Total expenditures 14,038,385 14,148,923 12,889,206 14,097,217 Revenues over (under) expenditures 2,094,832 2,647,546 (1,027,256)240,964 Note (A) 180 Table 4 Page 1 of 2 2005 2006 2007 2008 2009 2010 $6,702,610$6,977,604$7,444,199$8,263,763$9,218,038$9,631,635 520,031 1,011,553 1,137,576 2,505,523 879,092 1,020,334 382,339 597,557 444,833 423,465 435,618 479,148 4,878,487 4,228,308 4,229,414 3,734,826 3,777,355 4,936,443 3,197,360 1,887,314 1,995,859 1,665,604 1,513,667 1,650,772 127,555 129,400 160,383 142,283 139,955 188,693 432,959 648,744 1,271,216 984,846 456,145 469,312 90,956 251,414 170,344 296,815 102,901 273,446 16,332,297 15,731,894 16,853,824 18,017,125 16,522,771 18,649,783 1,575,863 1,577,484 1,616,374 1,706,244 1,646,974 1,926,982 3,954,019 3,887,884 4,122,411 4,345,716 4,418,436 4,968,433 1,558,987 1,523,170 1,640,713 1,955,250 1,736,999 1,731,700 1,977,798 2,074,835 2,238,793 2,202,680 2,003,635 2,194,853 4,511,338 2,256,122 3,077,310 4,077,576 2,115,628 1,351,368 Fiscal Year 11,022 4,512 - 5,453 45,708 - 95,125 82,986 254,728 3,499,713 8,997,400 237,272 1,912,738 4,202,665 1,303,297 1,084,959 951,240 2,925,174 62,700 117,909 274,896 3,269,986 2,256,958 194,380 1,436,724 266,144 306,332 287,620 139,118 1,202,998 1,449,035 782,273 792,273 1,029,836 783,974 765,736 2,478,205 119,544 219,065 384,293 835,167 981,281 - 25,114 148,972 155,397 56,189 - 252,176 142,451 2,584,854 71,341 125,857 141,005 21,275,730 17,063,093 18,580,018 24,076,064 26,113,283 18,621,182 (4,943,433)(1,331,199)(1,726,194)(6,058,939)(9,590,512)28,601 181 CITY OF COLUMBIA HEIGHTS, MINNESOTA CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS Last Ten Fiscal Years 2001 2002 2003 2004 Other financing sources (uses): Bonds issued $ - $ - $1,332,828$1,985,000 Bond premium (discount) - - (5,998)(5,935) Transfers in 4,940,5606,857,8033,849,932838,937 Transfers out (4,821,900)(5,751,430)(2,880,382)(370,489) Sale of capital assets - - 267,699 - Total other financing sources (uses)118,660 1,106,373 2,564,079 2,447,513 Net change in fund balance$2,213,492$3,753,919$1,536,823$2,688,477 Expenditures capitalized for governmental activities reporting purposes5,280,4071,273,9382,355,420 Debt service as a percentage of noncapital expenditures (B) (C)14.4%9.3%9.9% Debt service as a percentage oftotalexpenditures(B)(C)9.0%8.4%8.3% Note (A) Fiscal Year of total expenditures (B) (C)9.0%8.4%8.3% (A) Information necessary to present expenditures by the classifications used in this table is not available for years prior to 2002; the year the City implemented GASB Statement 34. (B) For the purpose of the debt service ratios presented in this table, only the principal and interest components of the debt service expenditures reported in this table are used, and noncapital expenditures are determined by subtracting expenditures capitalized for governmental activities reporting purposes from the total governmental funds expenditures reported in the table. (C) Certain information from prior years' presentations have been restated in this table to conform to the current presentation. 182 Table 4 Page 2 of 2 2005 2006 2007 2008 2009 2010 $ - $2,759,550$3,890,000$10,975,000$4,190,000 $ - - 26,303 (22,108) - - - 553,070 1,807,877 570,374 377,615 458,231 407,272 (80,321)(70,000)(70,000)(88,941)(99,224)(120,100) 628,654 78,013 191,897 428,240 95,781 - 1,101,403 4,601,743 4,560,163 11,691,914 4,644,788 287,172 ($3,842,030)$3,270,544$2,833,969$5,632,975($4,945,724)$315,773 3,518,309 4,592,787 1,896,363 7,909,56112,364,511 3,637,559 22.1%7.2%6.1%8.7%11.8%11.7% 18.5%5.3%5.4%5.9%6.2%9.4% Fiscal Year 18.5%5.3%5.4%5.9%6.2%9.4% 183 CITY OF COLUMBIA HEIGHTS, MINNESOTA TAX CAPACITY VALUE AND ESTIMATED MARKET VALUE OF ALL TAXABLE PROPERTY Table 5 Last Ten Fiscal Years (Unaudited) Adjusted Adjusted Tax Tax Capacity Value Taxable Net TotalEstimated Capacity Value FiscalOtherCaptured Tax Area Wide Allocation (B)Tax Capacity Direct TaxMarket as a Percent YearResidentialProperty (A)Increment ValueSubtotalContributionDistributionValue ( C)Rate (D)Valueof EMV 2001 $9,392,543 ($573,922)$3,085,984$11,904,60530.564%$749,621,7001.588% 2002 8,116,453 (385,323)1,976,8469,707,97649.114%843,669,7001.151% 2003$7,852,288$1,731,844 ($823,154)8,760,978 (409,330)2,111,49510,463,14345.272%982,517,6001.065% 20048,808,1431,813,247 (1,010,335)9,611,055 (379,508)2,267,40111,498,94847.888%1,077,714,4001.067% 200510,170,0411,874,629 (1,152,643)10,892,027 (417,605)2,275,59112,750,01347.859%1,203,032,8001.060% 200611,487,4241,861,133 (1,193,227)12,155,330 (453,305)2,324,91714,026,94244.736%1,271,030,5001.104% 200712,860,3731,967,884 (1,389,436)13,438,821 (443,665)2,473,14015,468,29641.511%1,387,050,1001.115% 200813,596,2902,219,619 (1,747,297)14,068,612 (485,657)2,877,43216,460,38743.076%1,454,932,2001.131% 200913,229,8032,426,270 (1,748,791)13,907,282 (551,683)3,175,71216,531,31147.430%1,424,291,3001.161% 201011,997,2972,401,197 (803,298)13,595,196 (624,231)3,579,41616,550,38156.881%1,303,072,9001.270% (A)The category "Other Property" is substantially all commercial/industrial property, plus nomimal amounts of railroad and personal property. (B)The Metropolitan Fiscal Disparities Act was first implemented for taxes payable in 1975 for the seven Metropolitan counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington. Forty percent of the increase in commercial-industrial (including public utility) valuation in each assessment district since 1971 is contributed to an area-wide tax base. Using the factors of population and real property market value, a per capita distribution index is calculated. This indexisemployedindeterminingwhatproportionofthevaluationshallbedistributedbacktoeachassessmentdistrict. Note (E) index is employed in determining what proportion of the valuation shall be distributed back to each assessment district. ( C)The Minnesota Legislature reduced some of the "class rates" used to calculate tax capacity value in fiscal years 1999 and 2001. This reduced the amount of market value that converts to tax capacity value. (D)For fiscal year 2002 and subsequent years, the Minnesota Legislature changed the formula by which state aid to cities was determined, significantly decreasing the annual amount of state aid received by the City of Columbia Heights. Some of this decrease was offset by the relatively higher City direct tax rates after 2001. (E)Certain information on the components of tax capacity prior to 2003 is not available. Source: Anoka County Auditor's Tax Certificate 184 CITY OF COLUMBIA HEIGHTS, MINNESOTA DIRECT AND OVERLAPPING PROPERTY TAX RATES (A) Table 6 Last Ten Fiscal Years City Fiscal Direct School Special Year Rate (A)District 13 CountyDistricts ( C)Total 2001 30.564%47.452%(D)28.125%8.741%114.882% 2002 49.114%(E)38.614%26.432%7.098%121.258% 2003 45.272%20.303%34.761%8.203%108.539% 2004 47.888%22.833%37.617%7.689%116.027% 2005 47.859%19.918%32.722%8.048%108.547% 2006 44.736%19.505%29.875%7.679%101.795% 2007 41.511%17.338%28.626%7.901%95.376% 2008 43.076%16.088%28.927%9.693%97.784% 2009 47.430%23.554%29.861%8.699%109.544% 2010 56.881%24.547%32.696%9.185%123.309% (A)These property tax rates are stated as a percentage of tax capacity value. Refer to Table 5 for tax capacity value. Rates are determined by tax district. Within the Anoka County property tax system, the City is an individual tax district. Thus the City direct rate is an individual rate, and is not comprised of component direct rates. (B)Overlapping rates are those of local and county governments that apply to property owners within the City. Most, but not all, overlapping rates apply to all City property owners. For example, although the school and county property tax rates apply to all City property owners, special district rates apply only to the City property owners whose property is located within each special district's geographic boundaries. (C)Special districts include Metropolitan Council, Metropolitan Transit District, Metropolitan Mosquito Control District, N.E. Metro School District 916, Rice Creek Watershed District, Anoka County Housing and Redevelopment Authority, Anoka County Regional Rail Authority, County/City Radio, and the Columbia Heights Housing and Redevelopment Authority. (D)For fiscal year 2001 and subsequent years, the Minnesota Legislature enacted several provisions which substantially reduced school district property tax levies, replacing the tax levy funds with state aid. (E)For fiscal year 2002 and subsequent years, the Minnesota Legislature changed the formula by which state aid to cities was determined, significantly decreasing the annual amount of state aid received by the City of Columbia Heights. Some of this decrease was offset by the increase in the City direct tax rate shown above for 2002 and subsequent years. Overlapping Rates (B) 185 - This page intentionally left blank - 186 CITY OF COLUMBIA HEIGHTS, MINNESOTA PRINCIPAL PROPERTY TAXPAYERS Table 7 Current Year and Nine Years Ago Percentage Percentage Tax of Total CityTaxable of Total City Capacity Tax CapacityCapacity Tax Capacity Taxpayer Value (A)Rank ValueValue (A)Rank Value Medtronic Inc $228,3721 1.59%$291,9271 2.79% Centro Bradley SPE 5 LLC 149,6962 1.04%N/AN/A N/A Columbia Park Properties 112,8683 0.78%N/AN/A N/A Stadium Village Properties LLC 112,4944 0.78%N/AN/A N/A Consolidated Realty of Mpls 109,6895 0.76%121,7547 1.16% Crestview Corporation 106,7026 0.74%79,9159 0.76% Columbia Heights Center LLC 87,3547 0.61%133,3414 1.27% Lynde Investment Co MN Partnership 78,2418 0.54%N/AN/A N/A New Heights Development LLC 73,1199 0.51%N/AN/A N/A Jeff's Bobby & Steve's Auto World 72,34610 0.50%77,14210 0.74% Bradley Operating LP N/AN/A N/A237,9452 2.27% Maylan Construction Company N/AN/A N/A134,3103 1.28% Lake State Properties N/AN/A N/A129,4485 1.24% Columbia Park Properties N/AN/A N/A127,8676 1.22% Northern States Power N/AN/A N/A83,3618 0.80% Total $1,130,881 7.85%$1,417,010 13.54% Total All Property $14,398,494 $10,462,875 (A) Tax Capacity values in this table are before adjustments for captured tax increment value and area-wide allocations. See Table 5. Source: Anoka County Auditor's Tax Certificate. 2010 2001 187 CITY OF COLUMBIA HEIGHTS, MINNESOTA PROPERTY TAX LEVIES AND COLLECTIONS Last Ten Years County FiscalGrossAdjustmentsAdjusted YearTax Levy (A)to Levy (B) Tax Levy 2001$4,629,920$4,824$4,634,744 2002 4,824,130 10,868 4,834,998 2003 4,817,984 1,805 4,819,789 2004 5,447,260 2,628 5,449,888 2005 6,102,537 152 6,102,689 2006 6,347,537 (160)6,347,377 2007 6,500,613 (189)6,500,424 2008 7,045,370 (74)7,045,296 2009 7,702,363 (161)7,702,202 2010 9,075,425 (302)9,075,123 (A) For years after 2001, the gross tax levy is the levy amount approved annually by City Council resolution prior to January 1 of the fiscal year indicated. For the year 2001, the levy amount approved annually by City Council resolution is the gross levy less the amount shown above as state-paid credit. The tax levies included in this table are only for the City of Columbia Heights taxing district. This table does not include levies by the special taxing district of Columbia Heights HRA. (B) Anoka County adjusts the property tax levy adopted by the City Council for certain items. These are primarily excess tax increment reimbursements and rounding. Abatements or increases of tax to individual taxpayers are not included in these adjustments. ( C) A portion of each gross property tax levy is paid to the City by the State of Minnesota, and referred to as a credit. For the year 2001 this is the "Homestead and Agricultural Credit." For the years after 2001, this is the "Market Value Homestead Credit." These credits are reported in the City's financial statements as intergovernmental revenue. The remaining levy collections are remitted to the City by Anoka County. The County collections are the only portion of the property tax levy reported as property tax revenue in the City's financial statements. Source: Anoka County Auditor's Tax Certificate. Also Anoka County Tax Settlement Statements for the City of Columbia Heights. 188 Table 8 Collected Within The Fiscal Year For Which LeviedCollections in Total Collections to Date State-PaidCollections% of AdjustedSubsequent % of Adjusted Credits ( C)by County Tax Levy Years Amount Tax Levy $1,004,368$3,577,11098.85%$34,028$4,615,50699.58% 570,151 4,192,05698.49%32,498 4,794,70599.17% 607,323 4,115,96798.00%64,941 4,788,23199.35% 588,271 4,760,78898.15%50,908 5,399,96799.08% 568,479 5,412,17898.00%83,482 6,064,13999.37% 517,322 5,672,90997.52%124,978 6,315,20999.49% 471,660 5,842,54097.14%151,081 6,465,28199.46% 451,019 6,400,60497.25%129,576 6,981,19999.09% 447,755 7,021,60596.98%116,801 7,586,16198.49% 535,625 8,279,06597.13%N/A8,814,69097.13% 189 CITY OF COLUMBIA HEIGHTS, MINNESOTA RATIOS OF OUTSTANDING DEBT BY TYPE Last Ten Fiscal Years Governmental Activities General General General Obligation Obligation Obligation Bonds Repaid Bonds Bonds WithTax Increment Total Fiscal Only WithWith PledgedPledged SpecialRevenueGovernmental Year General TaxesTax IncrementAssessments Bonds Activities 2001 $ - $2,619,721 $810,000 $ - $3,429,721 2002 - 2,008,206 705,000 - 2,713,206 2003 - 1,630,288 1,937,828 - 3,568,116 2004 - 3,264,704 1,773,623 - 5,038,327 2005 - 1,985,000 1,604,292 - 3,589,292 2006 - 1,385,000 4,181,569 - 5,566,569 2007 1,000,000 775,000 3,999,296 2,890,000 8,664,296 2008 11,000,000 150,000 4,569,460 2,890,00018,609,460 2009 13,940,000 580,000 4,614,486 2,881,00022,015,486 2010 13,855,000 580,000 3,976,750 2,838,00021,249,750 (A) Based on population and income data in Table 14. Certain information from prior years' presentations have been restated in this table to conform to the current presentation. 190 Table 9 Business-Type ActivitiesAll Activities GeneralLiquor ObligationFacility Bonds WithLeaseTotalPercentage Pledged UtilityRevenueBusiness-TypeTotalof PersonalPer RevenuesBondsActivitiesAll DebtIncome (A)Capita (A) $1,825,000$ - $1,825,000$5,254,7211.3%$284 1,650,000 - 1,650,0004,363,2061.1%233 $2,737,172 - 2,737,1726,305,2881.6%337 2,486,377 - 2,486,3777,524,7041.9%405 2,220,708 - 2,220,7085,810,0001.3%318 3,248,431 - 3,248,4318,815,0002.0%482 2,950,7045,040,0007,990,70416,655,0003.8%919 2,590,5405,040,0007,630,54026,240,0006.0%1,447 2,540,5125,040,0007,580,51229,595,9986.7%1,612 2,128,2484,900,0007,028,24828,277,9986.0%1,450 191 CITY OF COLUMBIA HEIGHTS, MINNESOTA RATIOS OF OUTSTANDING NET GENERAL BONDED DEBT BY TYPE Last Ten Fiscal Years Governmental Activities Subtotal of General GeneralNet GeneralPercentage General Obligation BondsObligation BondsBonded Debtof EstimatedObligation Bonds Fiscal Repaid Only WithWith PledgedRepaid With PropertyWith Pledged Year General TaxesTax IncrementTaxesValue (B)Special Assessments 2001 $ - $2,619,721$2,619,7210.35%$810,000 2002 - 2,008,2062,008,2060.24%705,000 2003 - 1,630,2881,630,2880.17%1,937,828 2004 - 3,264,7043,264,7040.30%1,773,623 2005 - 1,985,0001,985,0000.16%1,604,292 2006 - 1,385,0001,385,0000.11%4,181,569 2007 1,000,000 775,0001,775,0000.13%3,999,296 2008 11,000,000 150,00011,150,0000.77%4,569,460 2009 13,940,000 580,00014,520,0001.02%4,614,486 2010 13,855,000 580,00014,435,0001.11%3,976,750 (A) Based on population and income data in Table 14. Certain information from prior years' presentations have been restated in this table to conform to the current presentation. (B) Based on the estimated market value of property in Table 5. The estimated market value of property bears a stong relationship to the debt capacity of the City. It should be noted however, that in the State of Minnesota, property tax revenue is dependent on the tax capacity value of property. Tax capacity value is derived from estimated market value by a set of class rates and other adjustments as determined by the State legislature. The historical relationship between estimated market value and tax capacity value for property in the City is shown in Table 5. 192 Table 10 Business-Type Activities All Activities Subtotal of General Net General Obligation Bonds Bonded Debt Percentage Total With Pledged Repaid With of Personal Net General Per Utility Revenues Non-Tax SourcesIncome (A)Bonded Debt Capita (A) $1,825,000 $2,635,000 0.7%$5,254,721 $284 1,650,000 2,355,000 0.6%$4,363,206 233 2,737,172 4,675,000 1.2%$6,305,288 337 2,486,377 4,260,000 1.1%$7,524,704 405 2,220,708 3,825,000 0.9%$5,810,000 318 3,248,431 7,430,000 1.7%$8,815,000 482 2,950,704 6,950,000 1.6%$8,725,000 481 2,590,540 7,160,000 1.6%$18,310,000 1,010 2,540,512 7,154,998 1.6%$21,674,998 1,180 2,128,248 6,104,998 1.3%$20,539,998 1,054 193 CITY OF COLUMBIA HEIGHTS, MINNESOTA DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT Table 11 December 31, 2010 Estimated Estimated Share of Debt Percentage Overlapping Governmental Unit (A)Outstanding Applicable (B)Debt Debt repaid with property taxes: Anoka County $165,392,433 4.8374%$8,000,744 Anoka County Railroad Authority 30,155,000 4.8477%1,461,820 Independent School District 13 23,810,000 71.5625%17,039,043 Metropolitan Council 225,290,000 0.4696%1,057,978 Subtotal - overlapping debt 27,559,586 City direct debt - governmental activities 21,249,750 Total direct and overlapping debt $48,809,336 (A)Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the taxpayers of the City. This process recognizes that, when considering the City's ability to issue and repay long-term debt, the entire debt burden borne by the taxpayers should be taken into account. (B)The percentage of overlapping debt applicable is estimated using adjusted taxable net tax capacity values of property, which is the tax capacity value after adjustments for captured tax increment value and area-wide allocations (see Table 5) Applicable percentages were estimated by determining the portion of each governmental unit's tax. capacity value that is within the City's boundaries and dividing it by each unit's total tax capacity value. Source: Anoka County Auditor's Tax Certificate 194 CITY OF COLUMBIA HEIGHTS, MINNESOTA LEGAL DEBT MARGIN INFORMATION Table 12 Last Ten Fiscal Years Legal Debt Margin Calculation for Fiscal Year 2010 Taxable market value of property $1,299,323,500 Debt limitation percentage (A)3% Debt limit 38,979,705 Net debt applicable to limit (B)13,855,000 Legal debt margin $25,124,705 Legal debt margin as a percentage of limit 64.46% Legal Debt Margin Calculation for Fiscal Years 2001 Through 2009 Legal Debt Net Debt Legal Margin as a Fiscal Debt Applicable to Debt Percentage Year Limit Limit Margin of Debt Limit 2001 $14,386,974 $ - $14,386,974 100.00% 2002 15,506,730 - 15,506,730 100.00% 2003 17,102,916 - 17,102,916 100.00% 2004 19,133,440 - 19,133,440 100.00% 2005 21,831,836 - 21,831,836 100.00% 2006 24,490,232 - 24,490,232 100.00% 2007 27,255,660 1,000,000 26,255,660 96.33% 2008 43,388,271 11,000,000 32,388,271 74.65% 2009 42,618,129 13,940,000 28,678,129 67.29% (A)M.S.A. Section 475.53 (Limit on Debt) Subdivision 1. Generally, except as otherwise provided in Sections 475.51 to 475.74, "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 3% of the market value of taxable property in the municipality." (B)M.S.A. Section 475.51 (definitions) Subdivision 4. "Net 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. 195 CITY OF COLUMBIA HEIGHTS, MINNESOTA PLEDGED REVENUE COVERAGE NON-OBLIGATION DEBT Table 13 Last Ten Fiscal Years 2001 - 20072008 2009 2010 Economic Development Authority Tax Increment Revenue Bonds Series 2007: Tax increment revenue from applicable parcels $ - $243,159$267,142$241,854 Intergovernmental: Market Value TIF credit - 14,00219,55428,118 Net available revenue $0$257,161$286,696$269,972 Debt service: Principal - - 9,00043,000 Interest - 158,325152,363151,063 Total debt service $0$158,325$161,363$194,063 Coverage N/A 162%178%139% EconomicDevelopmentAuthority Fiscal Year Economic Development Authority Lease Revenue Bonds Series 2007B: Annual appropriation of liquor net revenues $ - $210,264$497,200$364,000 Investment income - 8,638 71 1,105 Issuance costs and administration (expense) - (10,062)(6,866)(10,393) Net available revenue $0$208,840$490,405$354,712 Debt service: Principal $ - $ - $ - $140,000 Interest - 208,264240,305237,155 Total debt service $0$208,264$240,305$377,155 Coverage N/A 100%204%94% Note: Details regarding the City's outstanding debt can be found in Note 6 to the financial statements. 196 CITY OF COLUMBIA HEIGHTS, MINNESOTA DEMOGRAPHIC AND ECONOMIC STATISTICS Table 14 Last Ten Fiscal Years Per Capita Fiscal Personal Personal Unemployment Year Population Income Income Rate 2001 18,529 $395,927,672 $21,368 3.60% 2002 18,698 399,538,864 21,368 4.50% 2003 18,698 399,538,864 21,368 4.70% 2004 18,600 397,444,800 21,368 4.40% 2005 18,261 442,135,332 24,212 3.80% 2006 18,288 442,789,056 24,212 3.90% 2007 18,124 438,818,288 24,212 4.60% 2008 18,137 439,133,044 24,212 5.50% 2009 18,361 444,556,532 24,212 8.50% 2010 19,496 472,037,152 24,212 7.50% Sources are as follows: Population: Data for the years 2001-2002, 2004-2009 provided by the Metropolitan Council. Data for the year 2003 was estimated as equal to next available prior year. Data for 2010 is from the 2010 US Census. Per Capita Income: Data for 2001-2004 estimated as equal to per capita income reported in the 2000 U.S. Census. Data for 2005-2010 provided by the US Census Bureau, 2005-2009 American Community Survey. Certain information from prior years' presentations have been restated in this table to conform to the current presentation. Unemployment Rate: Provided by MN Department of Employment and Economic Development for Anoka County. Rates are not compiled for individual communities within counties. 197 - This page intentionally left blank - 198 CITY OF COLUMBIA HEIGHTS, MINNESOTA PRINCIPAL EMPLOYERS Table 15 Current Year and Nine Years Ago Percentage of Percentage of Total Anoka Total Anoka County (A)County (A) Principal Employers Within CityEmployeesRankEmploymentEmployeesRankEmployment Independent School District 13 69310.39%4152 0.23% Medtronic Inc 60020.34%5321 0.30% Columbia Park Clinic 25030.14%707 0.04% City of Columbia Heights 20240.11%1944 0.11% Crestview Lutheran Home 18050.10%2263 0.13% Unique Thrift Store 7560.04%N/AN/A N/A Invest Cast Inc 7070.04%549 0.03% La Casita Mexican Restaurant 6080.03%N/AN/A N/A Bobby & Steve's Auto World 5390.03%N/AN/A N/A US Post Office 50100.03%4510 0.03% Rainbow Foods N/AN/A N/A1205 0.07% NEI College of Technology N/AN/A N/A766 0.04% SIS Enterprises N/AN/A N/A608 0.03% Total 2,233 1.25%1,792 1.00% (A) Employment data is not compiled for individual cities within Minnesota counties. Sources: The employee count for the City of Columbia Heights is from Table 16. 2010 data for other employers was compiled from Salesgenie business database at May 2011. 2001 data for other employers is estimated as equal to data from the 2003 Minnesota State Business Directory and the 2003 Minnesota Manufacturers Register. 2010 2001 199 CITY OF COLUMBIA HEIGHTS, MINNESOTA CITY GOVERNMENT EMPLOYEES BY FUNCTION/PROGRAM Last Ten Fiscal Years Function/Program 2001 2002 2003 2004 General government Mayor/council 5 5 5 5 Administration 7 7 5 5 Finance 13 13 13 12 Public safety: Police 35 35 31 30 Fire 34 34 40 39 Public works 20 20 17 18 Culture and rfecreation: Library 19 19 19 19 Parks 5 5 5 5 Recreation 13 13 13 13 Community development 7 7 7 6 Water 4 4 4 4 Sewer 4 4 4 4 Refuse - - - - Storm sewer - - - - Liquor 28 28 35 37 Total 194 194 198 197 Source: Organizational Chart in the City of Columbia Heights CAFR. Note: The above table shows the distribution of all employees by head count (including full-time, part-time and paid on-call), by function. This bears a strong relationship to the distribution of employee costs across functions. However, many employees provide services to more than one function, and employee costs are charged to each function based on the services received by each function. Employees as of December 31, 200 Table 16 200520062007200820092010 555555 5444510 12 12 13 13 14 13 30 31 31 34 35 36 35 36 33 29 31 30 16 17 16 17 18 17 21 22 22 25 21 19 555555 15 16 16 17 14 13 777665 445444 444333 - - - - - - - - - 1 1 1 37 37 42 38 40 41 196 200 203 201 202 202 Employees as of December 31, 201 CITY OF COLUMBIA HEIGHTS, MINNESOTA OPERATING INDICATORS BY FUNCTION/PROGRAM Last Ten Fiscal Years 200120022003 General government: Resolutions approved by City Council (A)777057 Ordinances adopted by City Council13419 Public safety: Police: Part I crimes (B)9719921,056 Part II crimes (B)2,6703,1423,225 Fire: Emergency medical calls (B)1,607 1,660 1,702 Fire calls (B)422 4,777 380 Inspections & Related Actions (B)3,495 3,562 4,616 Public works: Street paving and patching (tons of asphalt)not avail not avail 1,220 Street sweeping (tons of debris)708 990 640 Trees removed 159 175 143 Culture and recreation: Library: Items in collection 72,324 71,439 71,409 Circulation 119,555 119,082 116,917 Reference inquiries 14,447 14,383 18,427 Parks and recreation: Athletics participants (C)2,792 3,015 2,558 Other programs, estimated attendance (D)10,000 9,000 9,000 Number of paid room rentals 238 223 132 Community development: Number of business licenses issued 378 313 295 Function/Program Fiscal Year Number of building permits issued (E)1,235 1,216 1,176 Construction value of permits issued $12,547,885 $8,362,360$11,056,530 Water: Consumption (thousands of gallons)557,934 566,169 579,322 Sewer (sanitary): Wastewater (thousands of gallons, 12 months ended June 30)559,820 544,190 556,900 Miles of line cleaned/rodded/root-sawed 6 7 17 Refuse: Refuse (tons)8,202 8,241 7,670 Recycling (tons)2,045 1,915 1,873 Yardwaste (tons)794 824 809 Storm sewer: No operating indicators available not avail not avail not avail Liquor: Number of units sold not avail not avail not avail (A)In 2006, the City significantly increased enforcement of ordinances concerning nuisance/hazardous conditions of properties within the City. Resolutions per year sharply increased, given one resolution per significant enforcement action. (B)Public safety operating indicators include services provided to the City of Hilltop under contractual agreements. The City of Hilltop is completely encircled by the City of Columbia Heights and has a population of 744. (C)This operating indicator includes duplicate counts for participation in more than one team/league by some persons. (D)This operating indicator includes duplicate counts for attendance at more than one program by some persons. It is rounded to the nearest thousand attendees based on review of attendance data. (E)This operating indicator includes inspection permits issued for new construction, building alteration/addition, plumbing, heating, street excavation and sign installation. (F)The construction value of building permits issued in 2004 includes $30,573,000 for a water filtration plant owned and operated by the City of Minneapolis within the City of Columbia Heights. Certain information from prior years' presentations have been restated in this table to conform to the current presentation. Sources: Various City departments. 202 Table 17 2004 2005 2006 2007 2008 2009 2010 87 92 234 198 247 170 111 720141226129 1,229 1,280 1,167 1,246 1,098 882 768 3,435 3,496 3,184 3,144 2,966 1,275 1,683 1,653 1,873 1,806 1,888 2,093 1,694 1,664 483 581 387 445 385 660 846 2,077 2,379 3,709 4,603 6,955 3,724 5,720 1,271 409 710 1,910 1,415 1,033 1,054 1,064 658 637 648 420 581 638 261 296 188 357 175 121 180 73,105 68,226 70,354 71,594 72,420 69,702 72,055 116,533 115,598 119,593 125,222 126,271 120,705 131,885 14,670 17,225 15,106 13,715 13,793 17,771 14,352 2,139 1,988 1,654 1,537 1,510 1,602 1,500 9,000 9,000 9,000 8,000 8,000 8,000 8,000 134 164 191 185 190 210 160 307 327 342 306 363 379 393 Fiscal Year 1,159 1,304 1,701 1,313 1,113 1,187 1,351 $50,322,414(F)$13,041,878$26,798,827$22,230,118$21,917,792$13,376,732$14,481,712 538,358 527,621 529,581 538,844 518,791 518,299516,068,148 526,010 514,810 536,920 495,580 511,090 437,520 444,820 28 28 39 27 29 39 26 8,348 8,863 8,397 6,587 7,323 7,239 6,770 1,783 1,863 1,721 1,522 1,318 1,036 1,699 862 892 645 654 727 773 not avail not avail not avail not avail not avail not avail not avail not avail 798,900 758,000 768,000 920,121 1,029,139 1,028,160 203 CITY OF COLUMBIA HEIGHTS, MINNESOTA CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM Last Ten Fiscal Years Function/Program 2001 2002 2003 2004 General government: City hall square footage 28,530 28,530 28,530 28,530 Public safety: Police Stations 1 1 1 1 Fire Stations 1 1 1 1 Public Safety Bldg square footage Note A Note A Note A Note A Public works: Office and shop square footage 31,075 31,075 31,075 31,075 Trunk highway miles 3 3 3 3 County road miles 6 6 6 6 City street miles 62 62 62 62 Alley miles 19 19 19 19 Culture and recreation: Libraries 1 1 1 1 Library square footage 7,896 7,896 7,896 7,896 Parks 13 13 13 13 Playgrounds 11 11 11 11 Gymnasiums square footage - - - - Mtg & banquet rooms square footage 22,000 22,000 22,000 22,000 Citdlt Fiscal Year Community development: Senior high-rise apartments 145 145 145 145 Water: Watermain miles 66 66 66 66 Sewer: Sanitary sewer miles 59 59 59 59 Refuse: Recycling centers 1 1 1 1 Storm sewer: Storm sewer miles 34 34 34 34 Liquor: Retail stores owned 1 1 1 1 Retail stores leased 2 2 2 2 (A)For years prior to 2010, the police and fire stations are included in the City Hall square footage reported above. Beginning in 2010, the police and fire stations were in a separate public safety facility. Sources: Various City departments. 204 Table 18 2005 2006 2007 2008 2009 2010 28,530 28,530 28,530 28,530 28,530 28,530 111111 111111 Note A Note A Note A Note A Note A 47,088 31,075 31,075 31,075 31,075 31,075 31,075 333333 666666 62 62 62 62 62 62 19 19 19 19 19 19 111111 7,896 7,896 7,896 7,896 7,896 7,896 13 13 13 13 13 13 11 11 11 11 11 11 - - - - 12,726 12,726 22,000 22,000 22,000 22,000 22,000 22,000 Fiscal Year 145 145 145 145 145 145 66 66 66 66 66 66 59 59 59 59 59 59 111111 34 34 34 34 34 34 111333 2 2 2 - - - 205 - This page intentionally left blank - 206 IV. OTHER REQUIRED REPORTS SECTION 207 - This page intentionally left blank - 208 209 - This page intentionally left blank - 210 211 212 213 Internal Control Over Compliance 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 to determine the 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, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the City of Columbia Heights, Minnesota’s internal control over compliance. A deficiency in internal control over compliance exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be deficiencies, significant deficiencies, or material weaknesses. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. Schedule of Expenditures of Federal Awards We have audited the 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, 2010, and have issued our report thereon dated June 16, 2011. Our audit was performed for the purpose of forming our opinions on the financial statements as a whole. The schedule of expenditures of federal awards is presented for the purpose of additional analysis as required by U.S. Office of Management and Budget Circular A-133, Audit of States, Local Governments, and Non-Profit Organizations, and is not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards 214 215 CITY OF COLUMBIA HEIGHTS, MINNESOTA SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS For The Year Ended December 31, 2010 Federal CFDA Federal Federal Grantor/Pass-Through Grantor/Program Title Number Expenditures U.S. Department of Housing and Urban Development: Passed through Anoka County: Community Development Block Grant 14.218 $144,840 Direct: Low Rent Public Housing (operating fund subsidy)14.850 201,542 Public Housing Capital Fund Program 14.782 158,428 Public Housing Capital Fund Stimulus Program - ARRA 14.885 122,302 Agency total 627,112 U.S. Department of Justice: Direct: Bulletproof Vest Partnership Program 16.607 1,990 Community Oriented Policing Services - Hiring Reccovery Program - ARRA 16.710 61,900 Edward Byrne Memorial Justice Assistance Grants - ARRA 16.804 38,806 Passed through the City of Hilltop: Edward Byrne Memorial Justice Assistance Grant - ARRA 16.804 3,708 Agency total 106,404 U.S. Department of the Transportation: Passed through the State of Minnesota Department of Transportation: Transportation, Community and System Preservation Program - MN agreement no. 96460 20.205 228,773 Federal-Aid Highway Program Project Grant - ARRA - MN agreement no. 94788 20.205 1,756,364 Passed through the State of Minnesota Department of Public Safety: Operation Night Cap 20.601 7,362 Passed through the City of Coon Rapids: Safe and Sober Program 20.601 2,697 Agency total 1,995,196 U.S. Department of Education: Passed through the State of Minnesota Department of Education: Twenty-First Century Community Learning Centers 84.287 55,787 U.S. Department of Homeland Security: Passed through Anoka County: Emergency Management Program 97.042 1,900 Total Expenditures of Federal Awards $2,786,399 Notes to the schedule of expenditures of federal awards Note 1. Basis of Presentation The 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, including its component units, follow generally accepted accounting principles. The government-wide and the proprietary financial statements are reported using the accrual basis of accounting. The governmental fund financial statements are reported using the modified accrual basis of accounting as disclosed in the notes to the financial statements. The above schedule of expenditures of federal awards includes only the federal grant activity of the City and its component units and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of OMB Circular A-133, Audits of States, Local Governments, and Nonprofit Organizations. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. "ARRA" is an acronym for the American Recovery & Reinvestment Act of 2009. Note 2. Subrecipients During 2010, the City of Columbia Heights did not pass federal awards through to any subrecipients. Note 3. Reporting Entity For the puposes of this schedule, the , reporting entity includes all funds of the City of Columbia Heights, Minnesota.. Also included in the reporting entity, as blended component units, are the Columbia Heights Economic Development Authority and the Columbia Heights Housing and Redevelopment Authority, as the governing boards are substantively the same as the City Council, and the City is in a relationship of benefit/burden with the Authorities. 216 CITY OF COLUMBIA HEIGHTS, MINNESOTA SCHEDULE OF FINDINGS AND QUESTIONED COSTS For The Year Ended December 31, 2010 SECTION I - SUMMARY OF AUDIT RESULTS Financial Statements A. Type of auditors’ report issued: Unqualified B. Internal control over financial reporting: • Material weakness(es) identified? Yes X No • Significant deficiencies identified that are not considered to be material weaknesses? X Yes None reported C. Noncompliance material to financial statements noted? Yes X No Federal Awards D. Internal control over major programs: • Material weakness(es) identified? Yes X No • Significant deficiencies identified that are not considered to be material weaknesses? Yes X None reported E. Type of auditors’ report issued on compliance for major programs: Unqualified F. Any audit findings disclosed that are required to be reported in accordance with section 510(a) of Circular A-133? Yes X None reported G. Identification of major programs: Name of Federal Program CFDA Number Transportation, Community and System Preservation Program – MN 20.205 Federal-Aid Highway Program Project Grant – ARRA - MN 20.205 H. Dollar threshold used to distinguish between Type A and Type B programs: $300,000 I. Auditee qualified as a low-risk auditee: Yes X No 217 CITY OF COLUMBIA HEIGHTS, MINNESOTA SCHEDULE OF FINDINGS AND QUESTIONED COSTS For The Year Ended December 31, 2010 SECTION II – FINANCIAL STATEMENT FINDINGS 2010-1 Recreational Revenue Documentation Criteria: Certain documentation needs to be created in the City’s files to substantiate that proper procedures have been followed when recording recreational revenue. Condition: Documentation is not created that provides for verifying the completeness of recreation revenue. Cause: Not determinable. Effect: The City does not maintain an audit trail regarding recreational revenue. Recommendation: In prior years, the City attempted to change procedures to enable recreation revenue to be reconcilable. However, those changes did not resolve the problem as planned. We suggest the City continue to develop procedures that will eventually allow for proper reconciliation. Views of Responsible Officials and Corrective Action Plan: In 2010, the City developed additional procedures to address this condition. In 2011, the City plans to more fully implement and test these additional procedures to determine if they have resolved the condition. 218 CITY OF COLUMBIA HEIGHTS, MINNESOTA SCHEDULE OF FINDINGS AND QUESTIONED COSTS For The Year Ended December 31, 2010 2010-2 Assessment Roll Resolutions Condition and Criteria: The City Council approved assessment rolls during 2010 by adopting resolutions 2010-94, 2010-95 and 2010-96. The total amount of the assessments in resolution 2010-94 and 2010-95 were not included in the body of the resolution. Cause: Unknown. Effect: By not including the specific assessment roll information in the body of the resolution, there is not a sufficient “audit trail,” and there is an increased risk that errors in implementation of the resolution may occur and not be detected. Recommendation: We recommend the City strengthen its official record by including all specific information in the body of the resolution. Views of Responsible Officials and Corrective Action Plan: In the City’s judgment, its efforts in 2010 to address this condition did increase the percentage of new resolutions that complied with the auditors’ recommendation, relative to prior years. In 2011, the City will work to further increase compliance to the level necessary to eliminate the condition. SECTION III – FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No current year findings. SECTION IV – PRIOR YEAR FINDINGS 2009-01 Recreational Revenue Documentation 2009-02 Adopting Resolutions 219 - This page intentionally left blank - 220 221 CITY OF COLUMBIA HEIGHTS, MINNESOTA FINANCIAL DATA SCHEDULE For The Year Ended December 31, 2010 Line Item Account Description Total Projects Assets: Current assets: 111 Cash - unrestricted $1,015,526 114 Cash - tenant security deposits 17,000 100 Total cash 1,032,526 Accounts and notes receivable: 122 Accounts receivable - HUD other projects 39,019 125 Accounts receivable - miscellaneous 84 126 Accounts receivable - tenants 287 129 Accrued interest receivable 3,000 120 Total receivables, net of allowance 42,390 150 Total current assets 1,074,916 Noncurrent assets: Capital assets: 161 Land 177,375 162 Buildings 3,076,827 163 Furniture, equipment and machinery - dwellings 297,466 164 Furniture, equipment and machinery - administration 5,144 166 Less: accumulated depreciation (2,384,589) 167 Construction in progress 129,932 160 Total capital assets, net of accumulated depreciation 1,302,155 180 Total noncurrent assets 1,302,155 190 Total assets 2,377,071 Liabilities: Current liabilities: 312 Accounts payable <= 90days $37,445 333 Accounts payable - other governments 19,847 341 Tenant security deposits 17,000 342 Deferred revenue 792 345 Other current liabilities 39,422 310 Total current liabilities 114,506 350 Total noncurrent liabilities 0 300 Total liabilities 114,506 Net Assets: 508.1 Investment in capital assets, net of related debt 1,302,155 512.1 Unrestricted 960,410 513 Total net assets $2,262,565 222 CITY OF COLUMBIA HEIGHTS, MINNESOTA FINANCIAL DATA SCHEDULE For The Year Ended December 31, 2010 Public HousingPublic Housing OperatingCapital Fund Line Subsidy Program Item Account Description 14.850 14.872 Total Projects Revenue: 703 Net tenant rental revenue $337,613 $ - $337,613 704 Tenant revenue - other 13,382 - 13,382 706 HUD PHA grants 201,542 291,398 492,940 711 Investment income - unrestricted 12,500 - 12,500 700 Total revenue 565,037 291,398 856,435 Expenses: 911 Administrative salaries 25,380 - 25,380 912 Auditing fees 1,680 - 1,680 913 Outside management fees 154,824 - 154,824 914 Advertising and marketing 412 - 412 916 Other operating - administrative 2,256 - 2,256 917 Legal expense 3,273 - 3,273 919 Other expense 5,410 - 5,410 931 Water 16,719 - 16,719 932 Electricity 52,768 - 52,768 933 Gas 49,363 - 49,363 936 Sewer 9,471 - 9,471 938 Other utilities expense 16,261 - 16,261 942 Ordinary maintenance and operations - materials and other 29,450 - 29,450 943 Ordinary maint. and operations contracts - HVAC 8,268 - 8,268 943 Ordinary maint. and operations contracts - snow removal 1,626 - 1,626 943 Ordinary maint. and operations contracts - elevator 9,316 - 9,316 943 Ordinary maint. and operations contracts - grounds 6,720 - 6,720 943 Ordinary maint. and operations contracts - unit turnaround 4,895 - 4,895 943 Ordinary maint. and operations contracts - plumbing 21,640 - 21,640 943 Ordinary maint. and operations contracts - extermination 588 - 588 943 Ordinary maint. and operations contracts - janitorial 2,842 - 2,842 943 Ordinary maint. and operations contracts - routine maintenance 699 - 699 943 Ordinary maint. and operations contracts - miscellaneous 2,971 - 2,971 952 Protective services 5,950 - 5,950 961 Insurance premiums 20,937 - 20,937 962 Other general expenses 2,859 - 2,859 963 Payments in lieu of taxes 20,412 - 20,412 969 Total operating expenses 476,990 0 476,990 974 Depreciation 108,578 - 108,578 900 Total expenses 585,568 0 585,568 1001Operating transfers in 291,398 - 291,398 1002Operating transfers out - (291,398)(291,398) 1010 Total other financing sources (uses)291,398 (291,398)0 1000Excess (deficiency) of revenue over expenses and and other financing uses (sources)$270,867 $0 $270,867 Memo account information: 1103 Beginning equity $1,991,698 $ - $1,991,698 1120 Unit months available 1,212 - 1,212 1121 Number of unit months leased 1,210 - 1,210 223 CITY OF COLUMBIA HEIGHTS, MINNESOTA FINANCIAL DATA SCHEDULE For The Year Ended December 31, 2010 STATEMENT AND CERTIFICATION OF ACTUAL MODERNIZATION COSTS FY 2008 FY 2009 FY 2009 FY 2010 MN 46P10550108MN 46P10550109MN 46S10550109MN 46P105501-10 A.The actual modernization costs are as follows: Funds approved $104,250 $112,026 $131,959 $110,976 Funds (expended)(104,250)(112,026)(129,933) - Excess of funds approved (expended)$0 $0 $2,026 $110,976 Funds advanced - HUD CFP Grants $104,250 $91,359 $129,933 $ - Funds (expended): In prior years (74,082)(2,118)(7,631) - In current year (30,168)(109,908)(122,302)(18,352) Excess of funds advanced (expended)$0 ($20,667)$0 ($18,352) B.The distribution of costs by project as shown on the Final Statement of Development Cost budget, accompanying the Actual Development cost Certificate submitted to HUD for approval, is in agreement with the City's records. C.All modernization costs have been paid and all related liabilities have been discharged through payment. 224