07-25-11 CC Reg Mtg Agenda C. B. A.
CITY OF SHOREWOOD 5755 COUNTRY CLUB ROAD
CITY COUNCIL REGULAR MEETING COUNCIL CHAMBERS
MONDAY, JULY 25, 2011 7:00 P.M.
AGENDA
Attachments
1. CONVENE CITY COUNCIL MEETING
A. Roll Call Mayor Lizée ___
Hotvet ___
Siakel ___
Woodruff ___
Zerby ___
B. Review Agenda
2. APPROVAL OF MINUTES
A. City Council Work Session Minutes, July 11, 2011 Minutes
B. City Council Regular Meeting Minutes, July 11, 2011 Minutes
3. CONSENT AGENDA - Motion to approve items on Consent Agenda & Adopt
Resolutions Therein:
NOTE: Give the public an opportunity to request an item be removed from the
Consent Agenda. Comments can be taken or questions asked following removal
from Consent Agenda
A. Approval of the Verified Claims List Claims List
B. Culvert Replacements for Lake Virginia Drive and Division Street Engineer’s memo
C. Stubbe - Minor Subdivision Planning Director’s
memo, Resolution
4. MATTERS FROM THE FLOOR
(No Council action will be taken)
5. PUBLIC HEARING
6. REPORTS AND PRESENTATIONS
,Finance Director’s
A. 2010 Audit Presentation by Adam Flaherty Abdo, Eick and Meyers, LLP
memo
7. PARKS
8. PLANNING - Report by Representative
9. ENGINEERING/PUBLIC WORKS
CITY COUNCIL REGULAR MEETING AGENDA – JULY 25, 2011
Page 2 of 2
Attachments
10. GENERAL/NEW BUSINESS
11. OLD BUSINESS
12. STAFF AND COUNCIL REPORTS
A. Administrator and Staff
1. Monthly Financial Report Financial Report
2. Quarterly Investment Report Investment Report
B. Mayor and City Council
13. ADJOURN
CITY OF
SHOREWOOD
5755 Country Club Road • Shorewood, Minnesota 55331 • 952- 960 -7900
Fax: 952- 474 -0128 • www.ci.shorewood.mn.us • cityhall @ci.shorewood.mn.us
Executive Summary
Shorewood City Council Regular Meeting
Monday, 25 July, 2011
7:00 p.m.
A 6:00 p.m. Council Work Session is scheduled this evening.
An Executive Session will immediately follow the Regular City Council meeting.
Agenda Item #3A: Enclosed is the Verified Claims List for Council approval.
Agenda Item #313: Consideration of accepting the low quote for culvert replacement on
Division Street and culvert and excavation for the shoreline restoration grant project on
Lake Virginia Drive.
Agenda Item #3C: The City has negotiated to purchase a portion of the property owned by
James and Nancy Stubbe at 5750 Covington Road for future drainage improvements
adjacent to Silver Lake. The minor subdivision has been recommended by the Planning
Commission and allows the City to purchase the land. Due to extensive previous
discussions relative to the purchase, this item has been included on the consent agenda.
Agenda Item #5: There are no public hearings this evening.
Agenda Item #6A: Adam Flaherty of Abdo, Eick and Meyers, will provide the 2010 Audit
presentation.
Agenda Item #7: There are no Parks items this evening.
Agenda Item #8: A Planning Commission representative will report on the recent Planning
Commission meeting.
Agenda Item #9: There are no Engineering/Public Works items this evening.
Agenda Item #10A: There are no items for General/New Business this evening.
Agenda Item #11A: There are no items for Old Business this evening.
Agenda Item #12A. 1. & 2.: The Monthly Financial Report and Quarterly Investment Report is
provided.
#Za
CITY OF SHOREWOOD
CITY COUNCIL WORK SESSION
MONDAY, JULY 11, 2011
MINUTES
CONVENE CITY COUNCIL WORK SESSION
Acting Mayor Zerby called the meeting to order at 6:00 P.M.
A. Roll Call
Present. Acting Mayor Zerby; Councilmembers
Heck; Finance Director DeJong; Planni
Brown; and Engineer Landim
Absent: Mayor Liz&
B. Review Agenda
Hotvet moved, Siakel seconded, approving
2. 2012 GENERAL FUND BUDGET
Administrator Heck explained the
Budget. This evening Staff s plan i
to have a discussion about: how
perspective. Staff also wants'
the budget is presented in the
Council with a better Dersp
portion represents transfers
is for enterprise operations.
5755 COUNTRY CLUB ROAD
COUNCIL CHAMBERS
6:00 P.M.
ikel, and Woodruff, Administrator
Nielsen; Director of Public Works
presented. Motion passed 4/0.
ling packet contains the first draft of the City's 2012 General Fund
provide a general overview of the 2012 budget process. Staff wants
o about looking at the budget process from a priority- driven
s' some of the City's issues with regard to budgets. The first draft of
I format. Going forward the presentation will be adjusted to provide
what portion of the budget is for operational expenditures, what
the City's infrastructure and capital improvements, and what portion
e first draft reflects the requests made by the department heads.
Acting Mayor Zerby requested Staff prepare a budget calendar reflecting when budget work sessions will
be held, what will be discussed during the sessions, what the expected outcome is of each session and when
various approvals of the 2012 'General Fund Budget and property tax levy, the 2012 — 2016 Capital
Improvement Program (CIP) and the 2012 Enterprise Funds must be secured by.
Director DeJong stated he thought the City's traditional budget process has been pretty standard. He
explained Council has to adopt a preliminary property tax levy and have it certified by September 15
That has traditionally been completed by the end of August. There is a regular City Council meeting on
September 12 this year so Council could take action on the not -to- exceed property tax levy during that
meeting. During the next two months agreement has to be reached on a fairly sound preliminary budget for
2012 General Fund expenditures because those expenditures are tax supported. Enterprise Fund
discussions and 10 -Year CIP discussions have generally occurred during the September through possibly
November time period. The City will likely hold a Truth -In- Taxation meeting December 5 the first
Monday in December.. Council can adopt the final property tax levy and budgets during that meeting or
during its December 12 meeting.
CITY OF SHOREWOOD WORK SESSION MEETING MINUTES
July 11, 2011
Page 2 of 7
Administrator Heck stated this evening Staff would like Council to provide feedback on the draft budget
and from that, Staff can then decide how to structure the work sessions. He then stated because of the State
government shutdown it's not known if the levy limits will be extended for 2012.
Director DeJong stated if levy limits are extended for 2012, the City should be exempt from them because
the City has been accepted to participate in the performance measure program through the Office of the
State Auditor. He explained the draft budget anticipates an expenditures increase of approximately $25,000
(or 0.5 %) over the adopted 2011 General Fund expenditures. The department heads have submitted budgets
that take into account the economic realities the residents face.
DeJong then explained that the last couple of years the adopted (
$40,000 funds from sale of the City's liquor operations. At t
transferred into the Community Infrastructure Fund for accountin
for something of community wide value. The draft budget does not
funds. Also, the last couple of years a planned use of General
balance the General Fund budget. The General Fund balance was
of 2010 due to the actual general operations.
ieneral Fund Budget included the use of
ie end of 2010, the liquor funds were
g reasons and the funds were to be used
include a $40,000 transfer in from those
Fund balance was programmed to help
down approximately $40,000 at the end
DeJong went on to explain the balance in the General Fund is above the guidelines specified in the General
Fund Policy which is 50% — 60% of the next year's General Fund budgeted expenditures. The level at the
end of 2010 was 61% - 62 %. He stated Council should decide if it wants to keep that substantial amount of
money in the fund balance or if it would rather transfer out some amount of it for use somewhere else. He
explained there is a need for funding in some of the other funds. The CIP and the Long Rage Financial Plan
indicate the Stormwater Utility Fund, the Street Reconstruction Fund, and the Equipment Replacement
Fund all need additional funds. The surplus could also be used to help offset any shortfall in property tax
revenues. The draft 2012 budget does not include any change in property tax levy over 2011. The General
Fund budget recognizes an approximate $25,000 in additional revenues in the General Fund to offset the
approximate $25,000 increase in expenditures. The question before Council is whether or not it wants to
increase the property tax levy to generate $25,000 in revenues or use an alternative method to balance the
budget.
Acting Mayor Zerby suggested there be some discussion about how a priority -drive budget process could
begin to be incorporated into the 2012 budget process. He stated he didn't think the issue of balancing the
2012 budget could be solved this evening. Before that happens, Council and Staff need to go through the
draft 2012 General Fund budget at the detail line item level. He expressed hope that after going through the
budget line items and adjusting them there wouldn't be a need to find other funding sources.
Councilmember Hotvet stated because there are two Councilmembers that are going through their first
budgeting process and because there are some new programs being discussed a priority- driven budget
process may fit in nicely.' She commented that type of process may not be a perfect template for the City's
budget process but it would help with identifying the priorities.
Councilmember Siakel thanked Director DeJong for the high level memorandum he prepared about the
draft budget and the budget itself. She stated that she agreed with Acting Mayor Zerby that going through
the budget at the line item level would be helpful. She expressed her preference to have discussion about the
priority- driven budget process. She stated she does not support having a big increase in the property tax
levy, but she would be open to a combination of things.
CITY OF SHOREWOOD WORK SESSION MEETING MINUTES
July 11, 2011
Page 3 of 7
Councilmember Woodruff stated he thought priority- driven budgeting is a useful activity especially for the
two new Councilmembers. He commented that when he first became a Councilmember he was not sure
what each of the departments did and what a department's funding is for. He stated Staff has made some
assumptions about what they need to do in 2012 and identified the cost for doing those activities. He
requested Council be provided more detail about what each department needs. He noted that he thought the
assumption should be there will be no property tax levy increase and Staff should identify the impact on
City operations of doing that. If by doing that there are insufficient funds to support priority needs, then
there are alternative sources for funding that.
Woodruff then stated he does not believe Council was provided sufficient information to make any
decisions this evening. Because Council has not been provided a copy of the 2010 audit report, it doesn't
know what the General Fund balance is. He cited the Equipment Replacement Fund is programmed to enter
into a deficit state in a couple of years. He questioned if a transfer in amount of $50,000 is sufficient. He
suggested Staff prepare a document that depicts the flow of funds into all of the various funds and how the
various funds are used. A number of the funds are funded by a transfer in from the General Fund. He noted
the 2012 draft budget programs a $42,000 transfer from the General Fund to the Parks Improvement Fund;
the same as in past few years.
Acting Mayor Zerby stated he's not a fan of earmarking funds but it is
money is coming from.
where the
Councilmember Siakel stated she would appreciate Council getting regular updates on the fund balances
for all of the various funds. Director DeJong noted Council receives an updated General Fund Budget
report monthly. Administrator Heck stated Staff can start providing Council with a quarterly report on all
of the various funds.
Administrator Heck highlighted items not included in the draft 2012 General Fund Budget, noting there will
need to be Council discussion about them. There isn't any increase for the City's contribution to employee
health insurance and other benefits. There isn't any increase in union salaries. Labor contract negotiations
will begin in the next few months. Nothing has been allocated for trails. He explained that the majority of
the capital improvement funds are funded through transfers in from the General Fund. He stated he thought
going through a priority- driven budget process would be valuable.
Councilmember Woodruff noted that the budget document states the draft budget doesn't reflect any
change in salary allocation to more closely match actual time coding to General Fund departments and to
Enterprise Funds. He explained that over the last few months he has questioned Staff if the Public Works
labor budget is aligned with actual labor expenditures in 2011. The Public Works General Fund labor
expenditures to date exceed budget and that implies some Enterprise Fund labor budget is under budget. He
expressed he doesn't want the City to end up in a situation where it has to transfer funds from an Enterprise
Fund to the General Fund because the General Fund was under budgeted with regard to Public Works
labor. He expressed concern about assumptions used for Public Works labor allocations for the 2012
General Fund Budget.
Director DeJong explained the General Fund Budget is based on some expectation from prior years and
that doesn't always hold true. The problem is the City is spending more on general operations than is
budgeted for. The Enterprise Funds have healthy balances and enterprise operations are expected to be self
funding. The General Fund is primarily funded through property taxes with some revenues coming from
protective inspections. He stated that from his perspective there has been a real reluctance from staff to
change labor allocations because that change will result in there being an abundance of detailed questions
from Councilmembers asking what has changed rather than just accepting it as a change in budgeting
CITY OF SHOREWOOD WORK SESSION MEETING MINUTES
July 11, 2011
Page 4 of 7
philosophy. The 2012 General Fund Budget includes a budget for Tree Maintenance (approximately
$30,000) and a budget for Traffic Light Maintenance (approximately $13,000). If those budgets were to be
combined, staff would believe they open themselves up to criticism because they didn't have sufficient
detail to satisfy some Councilmembers.
DeJong stated that priority- driven budgeting is done at a higher level. It's not a line item detail view of the
budget process. He acknowledged that he didn't think Council can get there this year, but he did think that
could happen at some point.
Councilmember Woodruff stated if the General Fund labor spending is over budget there is no revenue
source in the General Fund to fund that. He then stated the 2012 General Fund Budget should reflect actual
costs so there isn't a deficit at the end of 2012. Director DeJong stated that requires allocating labor
expenditures to specific areas and having employees code where they spent their time so labor costs will be
charged to where they actually spent their time. Woodruff clarified that he wanted employees to report
what they actually do. Woodruff stated the 2012 labor allocation should reflect 2011 actual to avoid having
a General Fund deficit at the end of 2012. Woodruff also stated this is the first time in his tenure where
there has been a situation where labor expenditures have been significantly over budget in a specific
General Fund department budget. Woodruff clarified he was confident that Public Works employees are
doing what needs to be done.
Administrator Heck explained that for the 2011 budge
December 2009 and January — June 2010 actual is
indicated that more labor was spent in some enterpris
Prior to last year labor had not been allocated to
maintenance. There was labor being spent on those th
2011 to date more labor was spent on snow and ice c(
twelve -month period. He stated Staff will attempt to'
2012.
he determined the labor allocations based on July —
)or usage by department. The actual information
operations than had previously been budgeted for.
areas such as tree maintenance and traffic light
igs but there was no specific labor budget for it. In
rtrol than was reflected in the actual data from that
;fine the allocation of Public Works employees for
Councilmember Woodruff stated the 2012 General Fund Budget for Public Works personnel is
approximately $184,000, which' is the same as the 2011 adopted budget. Yet, the 2010 actual personnel
costs were approximately $290,000. Through May of this year, more than half of the 2011 budget for that
area has already been spent.
Director DeJong stated in order' to correctly allocate Public Works labor costs Council needs to be okay
with making those changes and, if as a result of doing so there are increases in the 2012 General Fund
budget, Council will have to decide how to fund the increases. He noted that Councilmember Woodruff
earlier suggested that there be no increase in the property tax levy for 2012. Woodruff stated if properly
allocating Public Works labor between the General Fund and the Enterprise Funds and keeping the levy flat
for 2012 doesn't work then. Council will have to decide what to do. Woodruff then stated if labor costs are
incorrectly being charged to Enterprise Funds there may eventually have to be a rate increase to cover those
costs and he doesn't think that is the correct thing to do.
Acting Mayor Zerby asked Staff what the next steps should be.
Director DeJong asked if Staff is getting direction from Council to adjust some of the existing programs
into something that is closer to what is actually occurring and to reallocate personnel and associated
operating expenditures from enterprise operations to the General Fund where they belong and to bring that
back to Council for review. Acting Mayor Zerby and Councilmember Woodruff supported doing that.
DeJong stated there are areas where no funds are budgeted for labor yet employees charge time to those
CITY OF SHOREWOOD WORK SESSION MEETING MINUTES
July 11, 2011
Page 5 of 7
areas and time isn't being charged to areas where there is a budget for it. There needs to be Council support
for making the labor allocations more realistic because there may be residents who become suspicious
because some things in the budget have changed.
Councilmember Woodruff stated the actual personnel costs for Elections in 2010 were approximately
$40,000. Yet, the 2012 budget for that some item is approximately $16,000. He questioned why the 2012
budget is so low. Director DeJong stated he can increase the budget for Elections personnel costs but he
must then decrease the personnel costs in General Government by the same amount. Because, those two
budgets are in the General Fund Budget it's a wash.
Director DeJong stated Council could also allocate Public Works personnel costs as a fixed amount. Doing
so will allow Staff to more accurately predict what the budget should be for different areas. He commented
that actual labor costs for various areas will likely change from year to year. He then stated there is no
guarantee that Administrator Heck's labor allocation for 2011 that doesn't seem to be working out
wouldn't work out in 2012.
Acting Mayor Zerby expressed his preference for taking a fresh approach. He stated he would like to know
what it actually costs the City to provide the various services. He suggested starting with the critical
services first such as police and fire. He stated parks may not be a critical 'service. Staff and Council need
to prioritize the services provided. He then stated based on discussion this evening it sounds like Council
wants to keep a balanced budget and reduce the tax burden. In order to do that there will have to be some
reductions. He noted he wants to start by taking a fresh look at things program by program in order of
priority for the City and its residents.
Administrator Heck stated Acting Mayor Zerby hit on 1
One of them is to identify what the true cost of provi
currently provided and how they impact the public. TI
for providing the services identified. He commented th
reduction in any service should that happen. He stated
providing the services.
Acting Mayor Zerb
costs other cities to
philosophies of a priority- driven budget process.
ig services is. Another is identifying the services
services then need to be prioritized and the costs
the City has to be able to explain why there is a
-re needs to be a way to measure the outcome of
to have comparison data for what it costs the City and what it
,s (e.g., cost per mile to plow a roadway) prior to having those
Administrator Heck stated he anticipated that the discussion about prioritizing services could be difficult.
He commented that the costs for police and fire services are fairly substantial yet the City has very limited
control over those costs. Acting Mayor Zerby suggested moving those two services aside and then going on
to the next set of priority services the City does have control over.
Acting Mayor Zerby reiterated that he would like Staff to prepare a budget process work plan and to
identify what the expected outcomes of discussions are and what the critical dates are. He stated he doesn't
want to just have a good budget discussion without there being decisions made.
Director DeJong asked Council to clarify what it would like to see first from Staff.
Administrator Heck suggested Staff take the current draft of information by department and put it into
various groups. For example the first group would include the things the City has to do such as provide
police and fire services, make its bond payments, plow snow off its roadways, and so forth. The costs for
such services would be identified. The second group would include things such as maintaining the various
CITY OF SHOREWOOD WORK SESSION MEETING MINUTES
July 11, 2011
Page 6 of 7
infrastructures and the costs for doing so. That would continue on until all services provided are included in
some group.
Acting Mayor Zerby stated he understands Administrator Heck to be saying that Staff will prepare a
preliminary prioritized 2012 budget. Heck clarified the services and costs to provide them would just be
grouped together. Staff will not prioritize the services. Zerby commented he thought that would be getting
away from the priority- driven budget process.
Councilmember Hotvet stated after having read the Government Finance
paper titled Anatomy of a Priority- Driven Budget Process she cox
process is a lot to undertake. She didn't think Council and Staff coulc
suggested taking small steps in that direction. She recommended thal
such a process would be to complete a program inventory, noting she
in the white paper. She stated it would be helpful to her to have depa
important to do. She then stated the white paper identifies what steps
some adjustments to the process laid out in the paper. She requested
with the draft strategic plan for the City.
fficers Association's white
ping to that type of budget
brace that process now. She
thing to do to move toward
thought that process was well defined
rtment heads tell her what they think is
to take, noting there might have to be
Staff identify where the programs fit
Acting Mayor Zerby stated the first step would be to inventory the programs. Step two would be to ask
Staff to provide their input on what Staff thinks the priorities should be and what the costs for the programs
are. Step 3 would be to incorporate that into the budget and bring that back to Council for discussion. He
then stated the various steps could be identified in a 2012 budget work plan.
Councilmember Siakel asked Director DeJong if he now had a clear understanding of what Council wants
and if there is anything he needs from Council at this time. DeJong responded he thought he understood
what Staff has to prepare for the next budget work session. DeJong explained he understands Council to be
asking for a definition of what the priorities are for the main programs the City departments provide, noting
the focus will be on the General Fund operations and that Enterprise Fund operations will be worked on in
the fall. Councilmember Hotvet stated she would like the list to include all the programs not just the top
five to ten.
Councilmember Woodruff stated he understood Director DeJong to say Staff will provide an exhaustive list
of programs. DeJong clarified Staff will provide a preliminary list.
Woodruff stated if you take all the General Fund programs on the list and the costs for those programs the
costs should equal the draft budget General Fund expenditures. Council can decide if it agrees with the
suggested priorities brought forward by Staff. He commented that in a way that process would be similar to
zero based budgeting which is difficult to do but useful. He stated he thought the process entailed taking a
macro view of a department and converting it into a micro view. He commented that for example he would
like to know what it costs to publish the monthly newsletter. He acknowledged that it will be difficult for
Staff to pull together some of the cost information.
There was discussion about when the next budget work session should be held.
Director DeJong stated he thought Staff, not just him, could have a list of programs ready by July 25 but
costs would not be available until August. Administrator Heck stated some costs will be easier to pull
together than others.
Acting Mayor Zerby suggested Staff provide Council with preliminary information so Council can provide
comments via email about whether or not the process is going in the right direction.
CITY OF SHOREWOOD WORK SESSION MEETING MINUTES
July 11, 2011
Page 7 of 7
Councilmember Siakel stated the amount of detail needed will likely vary by program. More detail is
required for larger programs. She noted she is not expecting to receive a lot of detail on every program.
Acting Mayor Zerby suggested maybe lower cost programs receive less focus.
3. ADJOURN
Woodruff moved, Siakel seconded, Adjourning the City Council Work Session of July 11, 2011, at
7:00 P.M. Motion passed 4/0.
RESPECTFULLY SUBMIT'
Christine Freeman, Recorder
ATTEST
Scott Zerby,
Brian Heck, City Administrator /Clerk
CITY OF SHOREWOOD 5755 COUNTRY CLUB ROAD
CITY COUNCIL REGULAR MEETING COUNCIL CHAMBERS
MONDAY, JULY 11, 2011 7:00 P.M.
MINUTES
1. CONVENE CITY COUNCIL REGULAR MEETING
Acting Mayor Zerby called the meeting to order at 7:05 P.M.
A. Roll Call
Present. Acting Mayor Zerby; Councilmembers Hotvet, Siakel, and Woodruff, Attorney Keane;
City Administrator Heck; Finance Director DeJon; Planning Director Nielsen; Director
of Public Works Brown; and Engineer Landim
Absent: Mayor Liz&
B. Review Agenda
Woodruff moved, Siakel seconded, approving the agenda as presented. Motion passed 4/0.
2. APPROVAL OF MINUTES
A. City Council Work Session Minutes, June 27, 2011
Siakel moved, Hotvet seconded, Approving the City Council Work Session Minutes of June 27,
2011, as presented. Motion passed 4/0.
B. City Council Regular Meeting Minutes, June 27, 2011
Woodruff moved, Siakel seconded, Approving the City Council Regular Meeting Minutes of June
27, 2011, as presented. Motion passed 4/0.
3. CONSENT AGENDA
Acting Mayor Zerby reviewed the items on the Consent Agenda.
Woodruff moved, Siakel seconded, Approving the Motions Contained on the Consent Agenda and
Adopting the Resolution Therein.
A. Approval of the Verified Claims List
B. Authorize Expenditure of Funds for Disposal of Street Sweepings, City Project 11 -11
C. Accept Quote and Award Contract for Pavement Marking, City Project 11.10
D. Adopting RESOLUTION NO. 11 -039 "A Resolution Accepting the East Water
Tower Rehabilitation Project, City Project 05 -04"
Motion passed 4/0.
CITY OF SHOREWOOD REGULAR COUNCIL MEETING MINUTES
July 11, 2011
Page 2 of 6
4. MATTERS FROM THE FLOOR
There were no matters from the floor presented this evening.
5. PUBLIC HEARING
None.
6. REPORTS AND PRESENTATIONS
None.
7. PARKS
No report was given because there had not been a Park 4
meeting.
8. PLANNING
No report was given because there had not been a Planning
meeting. The next meeting is scheduled for July 19, 2011.
9. ENGINEERING /PUBLIC WORKS
None.
10.
meeting since the last Council
meeting since the last Council
A. Electrical Regulations. Ordinance and Contract for Services
Director Nielsen explained the Minnesota Department of Labor and Industry issues electrical permits, and
electrical inspections for a lot of municipalities are done by a State contracted electrical inspector.
Because of the State government shutdown, the State has temporarily stopped issuing permits and
conducting inspections. State Statutes allow municipalities to issue permits and perform inspections when
authorized by ordinance. The meeting packet contains a copy of a draft ordinance amendment that allows
the City to issue permits and have an Electrical Inspector conduct electrical inspections. The City would
directly contract with the same person who contracts with the State to be the Electrical Inspector. The
packet also contains a copy of a''proposed contract for providing electrical inspection services. In addition
the packet contains a draft resolution approving publication of the ordinance by title and summary.
Nielsen stated that almost every remodeling project done in the City requires an electrical inspection.
Therefore, there is an immediate need to move forward with approving the draft ordinance so the City can
continue to provide inspection services. The cost for this will be recovered through the permit fees. He
noted that as soon as the shutdown ends the City would revert back to having the State conduct the
inspections.
Nielsen explained that Councilmember Woodruff has pointed out to him that the draft ordinance
amendment does not contain a sunset clause, noting that the League of Minnesota Cities' (LMC) model
ordinance does contain such a clause. It states that as soon as the State resumes providing such services
CITY OF SHOREWOOD REGULAR COUNCIL MEETING MINUTES
July 11, 2011
Page 3 of 6
the ordinance becomes null and void. He stated if Council wants he will add a sunset clause to the draft
amendment. He then explained Woodruff has also proposed two changes to the contract. In Section 1.4.2
change "... installer of electrical wiring neither less the 30 days nor more than 60 days prior..." to " "...
installer of electrical wiring not less the 30 days nor more than 60 days prior..." and in Section 18 change
... in the District Court of the State of Minnesota for Carver County" to "... in the District Court of the
State of Minnesota for Hennepin County ".
Nielsen asked Council if it wants to include a sunset clause in the ordinance or just wait until the
shutdown is over to repeal the ordinance.
Acting Mayor Zerby stated the LMC's model ordinance also deals with plumbing. He asked why the City
wouldn't just use the model ordinance. Director Nielsen explained the City already deals with plumbing
inspections with the exception of very large jobs that require state plan review. Nielsen stated if a need to
back fill State provided plumbing inspection services arises then Staff will prepare an ordinance for that,
noting he doesn't anticipate there will be that type of need.
Woodruff moved, Siakel seconded, Approving ORDINAP
Title 1000 of the Shorewood City Code Concerning El
amended to include a clause stating that once the Stat
services the Ordinance is no longer in effect, and Ac
Resolution Approving Publication of Ordinance No. 477
4/0.
11. OLD BUSINESS
A. Christmas Lake.Aouatic I
Administrator Heck ex
support for the propo€
Christmas Lake, Lotus
Christmas Lake boat
electrical service to the
Heck then explained that sir,
would be prudent to prepare
noting a copy of the draft
differences between what Cc
differences came about becau
concern about the City's, lack
Lake boat launch without fit
(DNR) and obtaining an'amc
Lake Homeowners Associatic
27 meeting.
CE N.O. 477 "An Ordinance Amending
ctrical Regulations" subject to it being
of Minnesota resumes providing such
)pting RESOLUTION NO. 11 -040 "A
by Title and Summary." Motion passed
ect
at during its June 27, 2011 meeting, Council passed a motion expressing
project to prevent the infestation of aquatic invasive species (AIS) in
J Lake Minnewashta and the installation of a control access gate at the
Gnd authorizing the expenditure of funds up to $1,000 for providing
chasing and installing directional signs, and striping the parking lot.
that meeting Attorney Keane, Mayor Lizee and he have decided that it
resolution for Council consideration that will memorialize that motion,
solution is included in the meeting packet. He noted there are some
acil discussed on June 27 and what's included in the resolution. The
of discussions with Keane. He explained that Keane had again expressed
authority to allow the installation of control access gate at the Christmas
getting approval from the Minnesota Department of Natural Resources
lment to the 1986 agreement between City, the DNR, and the Christmas
(HOA). He noted that Keane expressed that same concern during the June
Heck stated Keane and he understand it's in the City's best interest for Council to work toward obtaining
approval from the DNR and to work with the Minnehaha Creek Watershed District (MCWD) and the
Christmas Lake HOA to get it to move forward. Unfortunately, the shutdown of the State government
prohibits doing that at this time. Therefore, they have instead proposed the City more strictly enforce the
hours of operation at the launch site by installing a gate that can be locked at the entrance of the parking
area. The gate would be locked from 10:00 P.M. to 4:00 A.M. the next morning. The details of who
CITY OF SHOREWOOD REGULAR COUNCIL MEETING MINUTES
July 11, 2011
Page 4 of 6
would lock and unlock the gate have yet to be worked out. The resolution authorizes the Christmas Lake
HOA to implement an onsite AIS inspection program at the launch site during the hours of operation.
Heck stated the proposed pilot project had included having a centralized AIS inspection location at Lake
Minnewashta Regional Park which would be staffed by DNR trained inspectors. He is unsure if Carver
County has approved that. He then stated he did not think the City of Chanhassen has approved the
installation of a control access gate at the Lotus Lake boat launch. The plan had been for the various lake
associations to pool their inspection funding. If either of those two things don't come to fruition that
could potentially impact the pilot project as a whole. For example, there may not be enough resources to
have inspections at Christmas Lake.
Heck outlined what the resolution states the City would be responsible for doing if the resolution is
adopted. The City will purchase and install directional signage and stripe the parking area. The City will
implement some type of restricted access to the parking area. The City will allow the Christmas Lake
HOA to utilize DNR trained AIS inspectors to conduct inspections and prohibit watercraft with AIS, in
particular zebra mussels, on them from entering Christmas Lake. If an agreement is reached between the
City, the DNR, the MCWD and the Christmas Lake HOA to allow restricted access at the Christmas Lake
boat launch the City will move forward with the HOA on implementing that.
Attorney Keane explained that the 1986 three -party agreement is very explicit about what the rights,
duties and responsibilities of the City, the DNR, and the Christmas Lake HOA are. The unilateral
installation of a control access gate at the boat launch would violate the terms of that agreement. The
proposed interim measures, in particular the invocation of an emergency clause within the agreement, in
light of the heavy spread of zebra mussels in Lake Minnetonka allows for implementing the measures.
The City has informed the DNR that it wants to amend the agreement as soon as possible.
Councilmember Woodruff stated the resolution states the City will purchase and install a control access
gate for the entrance to the parking area to restrict access between 10:00 P.M. and 4:00 A.M. He asked
what the estimated cost is to do that.' He then asked what the logic is for installing a second gate.
Administrator Heck responded Attorney Keane, Mayor Lizee and he think that if the City can't authorize
the installation of a control gate at the boat launch itself then the next best thing is to control the hours of
use of the boat launch and parking site. Heck stated the gate at the entrance to the parking area could be a
swing gate' with a chain and padlock to secure it closed. Heck then stated he thought a lockable gate
would cost less than $2,000.
Woodruff then stated it's his understanding that the DNR requires public waters to be accessible between
4:00 A.M. and 10:00 P.M. Attorney Keane clarified that is what the three -party agreement stipulates.
Woodruff asked if the second gate would be installed independent of whether or not permission is
obtained from the DNR to install the electronic control access gate at the boat launch. Acting Mayor
Zerby stated he did not think of the parking lot gate as a second gate; he viewed it as being an interim
measure.
Woodruff commented that from his perspective there are operational issues that must be resolved. He
stated during its June 27 meeting Council authorized the expenditure of up to $1,000 for providing
electrical service to the gate at the boat launch, purchasing and installing directional signs, and striping
the parking lot. He asked if that $1,000 could be used for the purchase and installation of the gate at the
entrance to the parking area and then Council can approve funding for providing electrical service to the
gate, purchasing and installing directional signs, and striping the parking lot at a future date.
CITY OF SHOREWOOD REGULAR COUNCIL MEETING MINUTES
July 11, 2011
Page 5 of 6
Director Brown explained the gate for the parking lot entrance needs to have electronic open and lock
capabilities, and he thought the cost for that would be $1,500 — $2,000. He noted the automated car wash
industry has mastered control access with the use of access codes and emergency override capabilities. He
explained there are solutions available that allow public safety personnel 24 -hour access to areas. Acting
Mayor Zerby noted the City has time controlled access to the restroom facilities at Manor Park and there
are override capabilities there.
Councilmember Siakel asked if the electronic controls for the entrance gate could be reused on the control
access gate at the boat launch if that is eventually approved. Director Brown responded they could be
reused.
Councilmember Woodruff stated a control access gate for the boat
code capabilities. Director Brown stated the electronic controls for
would have to have access code and open/lock capabilities.
Zerby moved, Siakel seconded, Adopting RESOLUI
the Pilot Project at Christmas Lake to Prevent th
authorizing an expenditure not to exceed $2,000 for
electronic control access code and open /lock capabiliti
passed 4/0.
12. STAFF AND COUNCIL REPOR
A. Administrator and Staff
rich would have to provide access
gate at the parking area entrance
-041 "A Resolution Supporting
Aquatic Invasive Species" and
and installation of a gate with
trice to the parking area. Motion
Administrator Heck encouraged people with a sporting dog to educate themselves on the disease glastro
micosis. He noted his dog just passed away from that!.
Director Brown expressed thanks on behalf of the Public Works Department to Council for authorizing
the purchase of a One Wheel Loader. He stated that 15 minutes after the City took delivery of the Loader
it was in use. It was heavily used the day before to remove downed trees that blocked roadways out on the
Islands. He noted a preconstruction meeting was held for the Smithtown Way storm sewer improvement
project. Another preconstruction meeting will be held this week for the Murray Hill Road storm sewer
improvement project.
Engineer Landim stated the mill and overlay of Vine Hill Road has been completed. He then stated Flint
Hills Resources will not make its otta seal oil product until it receives an order of at least 40,000
gallons. An order of that size may be in jeopardy because of the State government shutdown.
Director Nielsen stated he and representatives from Metro Bowhunters Resources Base (MBRB)
recently toured the sites where it harvested deer in the City in 2010 as well as other potential sites. Some
of the sites harvested in the past will not be harvested in 2011 if another harvest is conducted.
Consideration is being given to add an alternate weekend (a fifth weekend) to the harvest schedule rather
than increasing the number of sites harvested.
Acting Mayor Zerby asked Staff what progress has been made on the Carver County Open Fiber
Initiative (CCOFI). He also asked if the Minnetonka School District has gotten back to Staff about the
possibility of the City using the District's fiber optic network to connect into Carver County's fiber ring.
CITY OF SHOREWOOD REGULAR COUNCIL MEETING MINUTES
July 11, 2011
Page 6 of 6
Administrator Heck responded he has not heard from the District or Carver County recently. Heck stated
he would follow up on both items.
B. Mayor and City Council
Acting Mayor Zerby noted the Excelsior Firefighters Relief Association's fund raising dance will be on
July 15 from 5:00 P.M. to midnight.
13. ADJOURN
Siakel moved, Woodruff seconded, Adjourning the City Council Regular Meeting of July 11, 2011,
at 7:44 P.M. Motion passed 4/0.
RESPECTFULLY SUBMITTED
Christine Freeman, Recorder
ATTEST:
Scott Zerby, Acting
Brian Heck, City Administrator /Clerk
COUNCIL ACTION FORM
Department Council Meeting Item Number
Finance July 25, 2011 3A
Item Description: Verified Claims
From: Michelle Nguyen
Bruce DeJong
Background / Previous Action
Claims for council authorization. The attached claims list includes checks numbered 51935 through
51982 totaling $231,282.15.
Staff Recommendation
Staff recommends approval of the claims list.
7/21/2011
12:17 PM
A/P
HISTORY CHECK REPORT
VENDOR SET:
01 City of
Shorewood
2,314.84
000000
BANK:
1 BEACON BANK
5,000.00
051936
DATE RANGE:
7/12/2011 THRU
99/99/9999
051939
500.00
051940
75.11
051941
3,729.16
CHECK
VENDOR I.D.
051943
NAME
STATUS
DATE
00051
4,038.38
EFTPS - FEDERAL W/H
D
7/19/2011
00092
051948
MN DEPT OF REVENUE
D
7/19/2011
20005
1,385.88
WELLS FARGO HEALTH BENEFIT SVC
D
7/19/2011
29399
051953
BLOOMBERG REAL ESTATE SERVICES
R
7/12/2011
00053
ICMA RETIREMENT TRUST - 302131 -4
R
7/19/2011
00052
PERA
R
7/19/2011
1
TROOP174
R
7/19/2011
1
JOHNSTON, GREG & KAT
R
7/25/2011
29306
ALLIED WASTE SERVICES #894
R
7/25/2011
03243
BNR IRRIGATION SERVICES, INC.
R
7/25/2011
29315
BOLTON & MENK, INC.
R
7/25/2011
04081
CARQUEST AUTO PARTS
R
7/25/2011
07600
CITY OF EXCELSIOR
R
7/25/2011
17400
CITY OF MINNETONKA
R
7/25/2011
24600
CITY OF TONKA BAY
R
7/25/2011
05056
CLAREY'S SAFETY EQUIPMENT, INC
R
7/25/2011
29278
CLASSIC CLEANING COMPANY
R
7/25/2011
06645
DEPT OF LABOR & INDUSTRY
R
7/25/2011
07270
ESS BROTHERS & SONS INC
R
7/25/2011
29322
EXCELSIOR FLORIST
R
7/25/2011
29387
FASCHING, GREGORY
R
7/25/2011
29400
FLAT & VERTICAL
R
7/25/2011
INVOICE
AMOUNT DISCOUNT
PAGE: 2
CHECK
CHECK CHECK
NO
STATUS AMOUNT
000000
12,714.57
000000
2,314.84
000000
1,092.39
051935
5,000.00
051936
1,561.00
051937
7,474.11
051939
500.00
051940
75.11
051941
3,729.16
051942
2,125.46
051943
2,191.50
051944
157.75
051945
4,038.38
051946
240.45
051947
976.32
051948
53.44
051949
847.47
051950
1,385.88
051951
778.05
051952
83.68
051953
1,000.00
051954
455.85
7/21/2011
12:17 PM
A/P
HISTORY CHECK REPORT
VENDOR SET:
01 City of
Shorewood
20.00
051957
BANK:
1 BEACON BANK
562.04
051959
DATE RANGE:
7/12/2011 THRU
99/99/9999
051961
80.00
051962
69.95
051963
422.20
CHECK
VENDOR I.D.
051965
NAME
STATUS
DATE
27195
5.71
GRAINGER, INC
R
7/25/2011
29401
051970
HENN CTY GIS USERS GROUP
R
7/25/2011
10506
781.26
HENN CTY INFO TECHNOLOGY DEPT
R
7/25/2011
10760
051975
HYDRA POWER HYDRAULICS
R
7/25/2011
1
KATHE WHITE
R
7/25/2011
29293
LAKE MINNETONKA ASSOCIATION
R
7/25/2011
13300
LEAGUE OF MINNESOTA CITIES
R
7/25/2011
21340
LOCAL LINK
R
7/25/2011
13975
M/A ASSOCIATES INC.
R
7/25/2011
29259
MALKERSON GUNN MARTIN LLP
R
7/25/2011
15050
MEDIACOM
R
7/25/2011
00079
MEDICA
R
7/25/2011
15176
MENARDS
R
7/25/2011
29320
MIDWEST PLAYSCAPES, INC.
R
7/25/2011
00085
MINNESOTA LIFE
R
7/25/2011
15900
OFFICE DEPOT
R
7/25/2011
20283
PARTS ASSOCIATES, INC.
R
7/25/2011
1350
PRUDENTIAL GROUP INSURANCE
R
7/25/2011
26100
QWEST
R
7/25/2011
29341
RACHAEL KROOG
R
7/25/2011
22347
RUMPCA COMPANIES, INC.
R
7/25/2011
23500
SO LK MTKA POLICE DEPT
R
7/25/2011
INVOICE
AMOUNT DISCOUNT
PAGE: 3
CHECK
CHECK CHECK
NO
STATUS AMOUNT
051955
267.11
051956
20.00
051957
64.00
051958
562.04
051959
18.20
051960
6,000.00
051961
80.00
051962
69.95
051963
422.20
051964
2,146.00
051965
58.84
051966
15,055.16
051967
5.71
051968
10,039.84
051969
433.91
051970
68.49
051971
90.00
051972
781.26
051973
551.66
051974
350.00
051975
76.00
051976
637.28
7/21/2011 12:17 PM
A/P
HISTORY CHECK REPORT
PAGE:
4
VENDOR SET: 01 City of
Shorewood
BANK: 1 BEACON BANK
DATE RANGE: 7/12/2011 THRU
99/99/9999
CHECK
INVOICE
CHECK
CHECK CHECK
VENDOR I.D.
NAME
STATUS
DATE
AMOUNT
DISCOUNT NO
STATUS AMOUNT
29335
SPORTS UNLIMITED
R
7/25/2011
051977
800.00
17050
STATE OF MN -MN DEPT OF HEALTH
R
7/25/2011
051978
2,118.00
29101
SUN NEWSPAPERS
R
7/25/2011
051979
37.18
17200
SUN PATRIOT NEWSPAPERS
R
7/25/2011
051980
44.10
25000
TOTAL PRINTING SERVICES
R
7/25/2011
051981
422.16
29269
WARNER CONNECT
R
7/25/2011
051982
2,800.00
00087
AFSCME CO 5 MEMBERS HEALTH FUN
E
7/25/2011
999999
408.00
05305
COMMUNITY REC RESOURCES
E
7/25/2011
999999
1,714.00
07900
HAWKINS, INC.
E
7/25/2011
999999
2,394.86
10473
HENN CTY TAXPAYER SVCS PUBLIC
E
7/25/2011
999999
30.00
13070
LANDINI, JAMES
E
7/25/2011
999999
40.00
15500
METRO COUNCIL ENVMT(WASTEWATER
E
7/25/2011
999999
59,486.26
15885
MIDWEST MAILING SYSTEMS, INC.
E
7/12/2011
999999
1,570.75
15885
MIDWEST MAILING SYSTEMS, INC.
E
7/25/2011
999999
571.25
19435
SPRINT
E
7/25/2011
999999
130.91
28451
WSB AND ASSOCIATES, INC.
E
7/25/2011
999999
14,366.50
29100
ZIEGLER, INC.
E
7/25/2011
999999
115.66
29324
HANSEN THORP PELLINEN OLSON, I
E
7/25/2011
999999
365.75
* * T O T A L S * *
NO
CHECK AMOUNT
DISCOUNTS
TOTAL APPLIED
REGULAR CHECKS:
47
76,692.70
0.00
76,692.70
HAND CHECKS:
0
0.00
0.00
0.00
DRAFTS:
3
16,121.80
0.00
16,121.80
EFT:
12
81,193.94
0.00
81,193.94
NON CHECKS:
0
0.00
0.00
0.00
VOID CHECKS:
0 VOID DEBITS
0.00
VOID CREDITS
0.00
0.00
0.00
0.00
TOTAL ERRORS: 0
VENDOR SET: 01 BANK: 1
TOTALS: 62
174,008.44
0.00
174,008.44
BANK: 1 TOTALS:
62
174,008.44
0.00
174,008.44
REPORT TOTALS:
63
174,008.44
0.00
174,008.44
07 -21 -2011 12:15 AM
C O U N
C I L REPORT BY VENDOR -JULY 25, 2011
PAGE:
1
VENDOR NAME
DATE
DESCRIPTION
FUND
DEPARTMENT
AMOUNT
AFSCME CO 5 MEMBERS HEALTH FUND
7/25/11
CHARLIES DAVIS
General Fund
Unallocated Expenses
51.00
7/25/11
GREG FASCHING
General Fund
Unallocated Expenses
51.00
7/25/11
JOSEPH LUGOWSKI
General Fund
Unallocated Expenses
51.00
7/25/11
BRADLEY MASON
General Fund
Unallocated Expenses
51.00
7/25/11
CHRISTOPHER POUNDER
General Fund
Unallocated Expenses
51.00
7/25/11
DANIEL RANDALL
General Fund
Unallocated Expenses
51.00
7/25/11
BRUCE STARK
General Fund
Unallocated Expenses
51.00
7/25/11
TERRY TOWER
General Fund
Unallocated Expenses
51.00
TOTAL:
408.00
ALLIED WASTE SERVICES #894
7/25/11
RECYLING DAY- 05/21
Recycling Utility
NON - DEPARTMENTAL
3,729.16
TOTAL:
3,729.16
BLOOMBERG REAL ESTATE SERVICES
7/12/11
EARNEST MONEY
Community Infrastr
Community Infrastructu
5,000.00
TOTAL:
5,000.00
BNR IRRIGATION SERVICES, INC.
7/25/11
PARK IRRIGATION
General Fund
Parks & Recreation
2,125.46
TOTAL:
2,125.46
BOLTON & MENK, INC.
7/25/11
MILL & OVERLAY
Street Capital Imp
Street Capt Improvemen
2,191.50
TOTAL:
2,191.50
CARQUEST AUTO PARTS
7/25/11
HYDRAULIC HOSES & FITTINGS
General Fund
Public Works
47.01
7/25/11
FUEL FILTERS
General Fund
Public Works
98.81
7/25/11
ELECTRICAL SHUTOFF
General Fund
Public Works
11.93
TOTAL:
157.75
CITY OF EXCELSIOR
7/25/11
2ND QTR WATER SVC
Water Utility
Water
4,038.38
TOTAL:
4,038.38
CITY OF MINNETONKA
7/25/11
5366 VINE HILL RD
Water Utility
Water
73.77
7/25/11
5350 VINE HILL RD
Water Utility
Water
96.23
7/25/11
5490 VINE HILL RD
Water Utility
Water
31.14
7/25/11
5350 VINE HILL RD -1ST QTR
Water Utility
Water
39.31
TOTAL:
240.45
CITY OF TONKA BAY
7/25/11
WATER
Water Utility
Water
607.32
7/25/11
SEWER
Sanitary Sewer Uti
Sewer
369.00
TOTAL:
976.32
CLAREY'S SAFETY EQUIPMENT, INC
7/25/11
CALIBRATION OF GAS MONITOR
Sanitary Sewer Uti
Sewer
53.44
TOTAL:
53.44
CLASSIC CLEANING COMPANY
7/25/11
C.H. SVC
General Fund
Municipal Buildings
531.01
7/25/11
P.W. SVC
General Fund
Public Works
316.46
TOTAL:
847.47
COMMUNITY REC RESOURCES
7/25/11
PARK COORDINATOR SERVICES
General Fund
Parks & Recreation
1,350.00
7/25/11
SSCC ASSISTANT
Southshore Communi
Senior Community Cente
364.00
TOTAL:
1,714.00
DEPT OF LABOR & INDUSTRY
7/25/11
2ND QTR SURCHARGE
General Fund
NON - DEPARTMENTAL
1,385.88
TOTAL:
1,385.88
EFTPS - FEDERAL W/H
7/19/11
FEDERAL W/H
General Fund
NON - DEPARTMENTAL
5,382.23
7/19/11
FICA W/H
General Fund
NON - DEPARTMENTAL
2,315.46
07 -21 -2011 12:15 AM
C O U N C I L REPORT BY VENDOR -JULY 25, 2011
PAGE:
2
VENDOR NAME
DATE DESCRIPTION
FUND
DEPARTMENT
AMOUNT
7/19/11 MEDICARE W/H
General Fund
NON - DEPARTMENTAL
799.40
7/19/11 FICA W/H
General Fund
Council
80.60
7/19/11 MEDICARE W/H
General Fund
Council
18.87
7/19/11 FICA W/H
General Fund
Administration
267.97
7/19/11 MEDICARE W/H
General Fund
Administration
62.67
7/19/11 FICA W/H
General Fund
General Government
458.96
7/19/11 MEDICARE W/H
General Fund
General Government
107.33
7/19/11 FICA W/H
General Fund
Finance
278.39
7/19/11 MEDICARE W/H
General Fund
Finance
65.10
7/19/11 FICA W/H
General Fund
Planning
269.36
7/19/11 MEDICARE W/H
General Fund
Planning
62.99
7/19/11 FICA W/H
General Fund
Protective Inspections
213.60
7/19/11 MEDICARE W/H
General Fund
Protective Inspections
49.96
7/19/11 FICA W/H
General Fund
City Engineer
182.79
7/19/11 MEDICARE W/H
General Fund
City Engineer
42.76
7/19/11 FICA W/H
General Fund
Public Works
656.18
7/19/11 MEDICARE W/H
General Fund
Public Works
153.45
7/19/11 FICA W/H
General Fund
Streets & Roadways
186.88
7/19/11 MEDICARE W/H
General Fund
Streets & Roadways
43.70
7/19/11 FICA W/H
General Fund
Tree Maintenance
50.69
7/19/11 MEDICARE W/H
General Fund
Tree Maintenance
11.86
7/19/11 FICA W/H
General Fund
Parks & Recreation
281.82
7/19/11 MEDICARE W/H
General Fund
Parks & Recreation
65.92
7/19/11 FICA W/H
Southshore Communi
Senior Community Cente
39.68
7/19/11 MEDICARE W/H
Southshore Communi
Senior Community Cente
9.27
7/19/11 FICA W/H
Water Utility
Water
181.33
7/19/11 MEDICARE W/H
Water Utility
Water
42.41
7/19/11 FICA W/H
Sanitary Sewer Uti
Sewer
159.91
7/19/11 MEDICARE W/H
Sanitary Sewer Uti
Sewer
37.41
7/19/11 FICA W/H
Recycling Utility
Recycling
1.57
7/19/11 MEDICARE W/H
Recycling Utility
Recycling
0.37
7/19/11 FICA W/H
Stormwater Managem
STORMWATER MANAGEMENT
108.35
7/19/11 MEDICARE W/H
Stormwater Managem
STORMWATER MANAGEMENT
25.33
TOTAL:
12,714.57
ESS BROTHERS & SONS INC
7/25/11 MANHOLE ADJ RINGS
General Fund
Streets & Roadways
778.05
TOTAL:
778.05
EXCELSIOR FLORIST
7/25/11 TWILA'S MOTHER
General Fund
Council
83.68
TOTAL:
83.68
FASCHING, GREGORY
7/25/11 DEPENDENT CARE EXP
General Fund
NON - DEPARTMENTAL
1,000.00
TOTAL:
1,000.00
FLAT & VERTICAL
7/25/11 CARPET CLEANING
Southshore Communi
Senior Community Cente
455.85
TOTAL:
455.85
GRAINGER, INC
7/25/11 LAMPS & SOCKETS
General Fund
Public Works
267.11
TOTAL:
267.11
HANSEN THORP PELLINEN OLSON, INC.
7/25/11 JUN- SMITHTOWN WAY STORM
Stormwater Managem
STORMWATER MANAGEMENT
365.75
TOTAL:
365.75
HAWKINS, INC.
7/25/11 HYDROFLUOSILICIC ACID
Water Utility
Water
2,394.86
TOTAL:
2,394.86
07 -21 -2011 12:15 AM
C O U N C I L REPORT BY VENDOR -JULY 25, 2011
PAGE:
3
VENDOR NAME
DATE DESCRIPTION
FUND
DEPARTMENT
AMOUNT
MISC. VENDOR JOHNSTON, GREG & KAT
7/25/11 03- 620225 -00
Water Utility
NON - DEPARTMENTAL
75.11
KATHE WHITE
7/25/11 KATHE WHITE:PARK EXP REIM
General Fund
Parks & Recreation
18.20
TROOP174
7/19/11 EGALE SCOUT PROJECT -PARK
Park Capital Impro
Park Capital Improveme
500.00
TOTAL:
593.31
HENN CTY GIS USERS GROUP
7/25/11 MEMBERSHIP -BRAD N. & JAMES
General Fund
City Engineer
20.00
TOTAL:
20.00
HENN CTY INFO TECHNOLOGY DEPT
7/25/11 800MHZ RADIO
General Fund
Public Works
64.00
TOTAL:
64.00
HENN CTY TAXPAYER SVCS PUBLIC RECORDS
7/25/11 EGKF64 - MONTHLY FEE
General Fund
City Engineer
30.00
TOTAL:
30.00
HYDRA POWER HYDRAULICS
7/25/11 REBUILD HYDULIC RUMP
General Fund
Public Works
562.04
TOTAL:
562.04
ICMA RETIREMENT TRUST - 302131 -457
7/19/11 P/R DEDUCTS - DEFERRED COM
General Fund
NON - DEPARTMENTAL
1,435.96
7/19/11 P/R DEDUCTS - DEFERRED COM
General Fund
NON - DEPARTMENTAL
125.04
TOTAL:
1,561.00
LAKE MINNETONKA ASSOCIATION
7/25/11 2011 MILFOIL TREATMENTS RE
General Fund
General Government
6,000.00
TOTAL:
6,000.00
LANDINI, JAMES
7/25/11 JUL WELLNESS
General Fund
City Engineer
40.00
TOTAL:
40.00
LEAGUE OF MINNESOTA CITIES
7/25/11 2011 JOINT LEG CONF
General Fund
Administration
80.00
TOTAL:
80.00
LOCAL LINK
7/25/11 AUG WEB
General Fund
Municipal Buildings
69.95
TOTAL:
69.95
M/A ASSOCIATES INC.
7/25/11 TRASH CAN
General Fund
Parks & Recreation
422.20
TOTAL:
422.20
MALKERSON GUNN MARTIN LLP
7/25/11 MAY -GEN MATTERS
General Fund
Professional Svcs
1,850.00
7/25/11 PUBLIC IMPROVEMENT -WA CONN
Water Utility
Water
55.50
7/25/11 ACQUISITION -5750 COVINGTON
Stormwater Managem
STORMWATER MANAGEMENT
240.50
TOTAL:
2,146.00
MEDIACOM
7/25/11 SVC 07/16 -08/15
Southshore Communi
Senior Community Cente
58.84
TOTAL:
58.84
MEDICA
7/25/11 MEDICAL PREM
General Fund
Unallocated Expenses
15,055.16
TOTAL:
15,055.16
MENARDS
7/25/11 A/C TREATED
General Fund
Parks & Recreation
5.71
TOTAL:
5.71
METRO COUNCIL ENVMT(WASTEWATER)
7/25/11 WASTEWATER SVC
Sanitary Sewer Uti
Sewer
59,486.26
TOTAL:
59,486.26
MIDWEST MAILING SYSTEMS, INC.
7/25/11 AUG - NEWSLETTER POSTAGE
General Fund
General Government
500.00
7/12/11 2ND QTR UTILITY SVC
Water Utility
Water
307.69
7/12/11 2ND QTR UTILITY SVC
Water Utility
Water
85.00
07 -21 -2011 12:15 AM
VENDOR NAME
MIDWEST PLAYSCAPES, INC
MINNESOTA LIFE
MN DEPT OF REVENUE
OFFICE DEPOT
PARTS ASSOCIATES, INC.
C O U N
DATE
C I L REPORT BY VENDOR -JULY 25, 2011
DESCRIPTION FUND
PAGE:
DEPARTMENT
4
AMOUNT
7/25/11
UB ADDT'L SVC FEE
Water Utility
Water
17.82
Public Works
7/12/11
2ND QTR UTILITY SVC
Sanitary Sewer Uti
Sewer
307.69
7/12/11
2ND QTR UTILITY SVC
Sanitary Sewer Uti
Sewer
85.00
Administration
7/25/11
UB ADDT'L SVC FEE
Sanitary Sewer Uti
Sewer
17.81
7/12/11
2ND QTR UTILITY SVC
Recycling Utility
Recycling
307.69
Planning
7/12/11
2ND QTR UTILITY SVC
Recycling Utility
Recycling
85.00
7/25/11
UB ADDT'L SVC FEE
Recycling Utility
Recycling
17.81
Public Works
7/12/11
2ND QTR UTILITY SVC
Stormwater Managem
STORMWATER MANAGEMENT
307.68
7/12/11
2ND QTR UTILITY SVC
Stormwater Managem
STORMWATER MANAGEMENT
85.00
Parks & Recreation
7/25/11
UB ADDT'L SVC FEE
Stormwater Managem
STORMWATER MANAGEMENT
17.81
Water Utility
Water
220.88
TOTAL:
2,142.00
Sewer
7/25/11
CATHCART PARK -SWING
Park Capital Impro
Park Capital Improveme
10,039.84
Stormwater Managem
STORMWATER MANAGEMENT
127.75
TOTAL:
10,039.84
TOTAL:
7/25/11
LIFE INS
General Fund
Unallocated Expenses
433.91
TOTAL:
781.26
TOTAL:
433.91
Water
7/19/11
STATE W/H
General Fund
NON - DEPARTMENTAL
2,314.84
TOTAL:
551.66
TOTAL:
2,314.84
Parks & Recreation
7/25/11 TONER
7/25/11 LOCTITE PRODUCTS
PERA 7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
7/19/11 P/R DEDUCTS -PERA
PRUDENTIAL GROUP INSURANCE
QWEST
7/25/11 LIFE INSURANCE
7/25/11 JUL SVC
7/25/11 JUL SVC
RACHAEL KROOG
7/25/11 AUG 5TH PERFORMANCE
RUMPCA COMPANIES, INC. 7/25/11 BRUSH DISPOSAL
General Fund
Public Works
68.49
TOTAL:
68.49
General Fund
Public Works
90.00
TOTAL:
90.00
General Fund
NON - DEPARTMENTAL
3,460.23
General Fund
Administration
323.37
General Fund
General Government
537.84
General Fund
Finance
336.25
General Fund
Planning
346.68
General Fund
Protective Inspections
278.39
General Fund
City Engineer
214.42
General Fund
Public Works
798.53
General Fund
Streets & Roadways
221.02
General Fund
Tree Maintenance
59.49
General Fund
Parks & Recreation
311.37
Southshore Communi
Senior Community Cente
46.41
Water Utility
Water
220.88
Sanitary Sewer Uti
Sewer
189.65
Recycling Utility
Recycling
1.83
Stormwater Managem
STORMWATER MANAGEMENT
127.75
TOTAL:
7,474.11
General Fund
Unallocated Expenses
781.26
TOTAL:
781.26
Water Utility
Water
315.23
Water Utility
Water
236.43
TOTAL:
551.66
General Fund
Parks & Recreation
350.00
TOTAL:
350.00
General Fund
Tree Maintenance
76.00
07 -21 -2011 12:15 AM C O U N C I L REPORT BY VENDOR-JULY 25, 2011 PAGE: 5
VENDOR NAME DATE DESCRIPTION FUND DEPARTMENT AMOUNT
TOTAL:
76.00
SO LK MTKA POLICE DEPT
7/25/11 2ND QTR -COURT OVERTIME
General Fund
Police Protection
637.28
TOTAL:
637.28
SPORTS UNLIMITED
7/25/11 GOLF EVENT
General Fund
Parks & Recreation
800.00
TOTAL:
800.00
SPRINT
7/25/11 SVC 06/13 -07/12
Water Utility
Water
65.45
7/25/11 SVC 06/13 -07/12
Sanitary Sewer Uti
Sewer
65.46
TOTAL:
130.91
STATE OF MN -MN DEPT OF HEALTH
7/25/11 2ND QTR STATE SURCHARGE
Water Utility
NON - DEPARTMENTAL
2,118.00
TOTAL:
2,118.00
SUN NEWSPAPERS
7/25/11 BALGARD 07/14
General Fund
Planning
37.18
TOTAL:
37.18
SUN PATRIOT NEWSPAPERS
7/25/11 BALGARD CUP HEARING 07/16
General Fund
Planning
44.10
TOTAL:
44.10
TOTAL PRINTING SERVICES
7/25/11 WINDOW ENVELOPES
Water Utility
Water
105.54
7/25/11 WINDOW ENVELOPES
Sanitary Sewer Uti
Sewer
105.54
7/25/11 WINDOW ENVELOPES
Recycling Utility
Recycling
105.54
7/25/11 WINDOW ENVELOPES
Stormwater Managem
STORMWATER MANAGEMENT
105.54
TOTAL:
422.16
WARNER CONNECT
7/25/11 MAINT SVC
General Fund
Municipal Buildings
2,800.00
TOTAL:
2,800.00
WELLS FARGO HEALTH BENEFIT SVCS
7/19/11 P/R DEDUCTS -HSA
General Fund
NON - DEPARTMENTAL
803.94
7/19/11 P/R DEDUCTS -HSA
General Fund
General Government
288.45
TOTAL:
1,092.39
WSB AND ASSOCIATES, INC.
7/25/11 APR -GIS UPDATE
General Fund
City Engineer
170.00
7/25/11 GIS & CAD SUPPORT
General Fund
City Engineer
1,040.00
7/25/11 SIGN ASSET MGMT WORK PLAN
General Fund
Traffic Control /Str Li
616.00
7/25/11 MAY -SKATE PARK- DRINKING FT
Park Capital Impro
Park Capital Improveme
192.00
7/25/11 NIELSON DRIVE
Street Capital Imp
Street Capt Improvemen
384.00
7/25/11 MEADOWVIEW NEIGHBORHOOD
Street Capital Imp
Street Capt Improvemen
480.00
7/25/11 APR CARTGRAPH -TECH CIP
Technology Fund
TECHNOLOGY FUND
4,116.00
7/25/11 24600 WELTSEY SW SVC
Sanitary Sewer Uti
Sewer
384.00
7/25/11 MAY -L.S. #15 & 17
Sanitary Sewer Uti
Sewer
960.00
7/25/11 6180 MURRAY HILL DRAINAGE
Stormwater Managem
STORMWATER MANAGEMENT
2,911.50
7/25/11 6180 MURRAY HILL DRAINAGE
Stormwater Managem
STORMWATER MANAGEMENT
3,113.00
TOTAL:
14,366.50
ZIEGLER, INC.
7/25/11 PLOW CUTTING EDGES
General Fund
Ice & Snow Removal
115.66
TOTAL:
115.66
07 -21 -2011 12:15 AM C O U N C I L REPORT BY VENDOR -JULY 25, 2011 PAGE: 6
VENDOR NAME DATE DESCRIPTION FUND DEPARTMENT AMOUNT
* *PAYROLL EXPENSES
7/18/2011 - 99/99/9999 General Fund
Council
1,300.00
General Fund
Administration
4,460.32
General Fund
General Government
7,418.37
General Fund
Finance
4,637.98
General Fund
Planning
4,781.83
General Fund
Protective Inspections
3,839.71
General Fund
City Engineer
2,957.69
General Fund
Public Works
11,014.21
General Fund
Streets & Roadways
3,048.52
General Fund
Tree Maintenance
820.39
General Fund
Parks & Recreation
4,904.80
Southshore Communi
Senior Community Cente
640.12
Water Utility
Water
3,046.42
Sanitary Sewer Uti
Sewer
2,615.77
Recycling Utility
Recycling
25.24
Stormwater Managem
STORMWATER MANAGEMENT
1,762.34
TOTAL:
57,273.71
FUND TOTALS
101
General Fund
114,329.12
402
Park Capital Improvements
10,731.84
404
Street Capital Improvemen
3,055.50
408
Technology Fund
4,116.00
450
Community Infrastructure
5,000.00
490
Southshore Community Ctr.
1,614.17
601
Water Utility
14,153.82
611
Sanitary Sewer Utility
64,836.94
621
Recycling Utility
4,274.21
631
Stormwater ManagementUtil
9,170.55
GRAND TOTAL: 231,282.15
------------------------- - - - - --
TOTAL PAGES: 6
_ ® #3B
City f Shorewood Council Meeting tem M TYPE
y g Reggular ular Meeting
Title / Subject: Culvert Replacements for Lake Virginia Drive and Division Street
Meeting Date: July 25, 2011
Prepared by: James Landini
Reviewed by:
Attachments:
Policy Consideration:
Background: Staff received 5 quotes for replacement of a failed culvert on Division St. and the
replacement of a poor condition culvert and excavation for the shoreline restoration grant project on
Lake Virginia Drive.
The failed culvert on Division Street has a temporary pipe installed to maintain flow and traffic. The
failed culvert is corrugated metal which rusted through. The culvert under Lake Virginia Drive is also
corrugated metal with evidence of rust along the entire bottom.
Financial or Budget Considerations: The low quote is $21,784.00 and would be a maintenance activity
funded by the Stormwater utility fund. The stormwater utility fund does have a balance to cover the
activity and would be eligible for the bonding reimbursement resolution that was passed in June of
2011.
Options:
1. Direct staff to work with Parrott Contracting to replace the culverts and provide excavation
assistance for the grant project.
2. Direct staff to work with a different quoter.
3. Do nothing.
Recommendation / Action Requested: Staff recommends working with Parrott Contracting to replace
the culverts and provide excavation assistance for the shoreline restoration grant project.
Next Steps and Timelines:
Connection to Vision / Mission:
Mission Statement: The City of Shorewood is committed to providing residents quality public services, a
healthy environment, a variety of attractive amenities, a sustainable tax base, and sound financial
management through effective, efficient, and visionary leadership. Page 1
� 11%
City of Shorewood Council Meeting Item
Title / Subject:
Meeting Date:
Prepared by:
Reviewed by:
Attachments:
Stubbe — Minor Subdivision
25 July 2011
Brad Nielsen
Planning Commission
A Staff Report
B Draft Resolution
#3C
MEETING TYPE
Regular Meeting
Policy Consideration: Should the City approve a minor subdivision allowing it to purchase a parcel of
land for future stormwater improvements adjacent to Silver Lake?
Background: See staff report — Exhibit A, attached. The Planning Commission recommended
unanimously to approve the minor subdivision.
Financial or Budget Considerations: None. Any financial considerations have been addressed in the
previous discussions wherein the purchase was authorized.
Options: Approve the minor subdivision; deny the minor subdivision; or take no action (not really an
option).
Recommendation / Action Requested: Staff agrees with the Planning Commission's recommendation
to approve the minor subdivision.
Next Steps and Timelines: Once the subdivision is approved, the resolution (attached) must be
recorded with Hennepin County.
Connection to Vision / Mission: The purchase of the property and the future drainage improvements
contribute to a healthy environment.
Mission Statement: The City of Shorewood is committed to providing residents quality public services, a
healthy environment, a variety of attractive amenities, a sustainable tax base, and sound financial
management through effective, efficient, and visionary leadership. Page 1
CITY OF
SHOR WOOD
5755 COUNTRY CLUB ROAD g# SHOR EWOOD, MINNESOTA 55331 -8927 * (952) 900 -7909
FAX (952) 474 -0128 a www.ci.shorewood.mmus @ Cityhali @c €.shorewood.mn.us
1011.4 V Ai
a 01191,
TO: Planning Commission, Mayor and City Council
`ROM: Brad Nielsen
DATE: 13 July 2011
RE: Stubbe — Minor Subdivision
FILE NO. 405 (11.07)
BACKGROUND
Early this year the City undertook a drainage improvement project on the north end of Silver
Lake, intended to remove silt that had accumulated from roadway runoff. The project was the
first step in. an overall water quality project for the lake. Future work will necessitate additional
improvements to prevent the same thing from happening again. These future improvements will
involve some sort of detention facility (a basin or underground tank) which will require
additional land on the south side of Covington Road.
The City has offered to buy a portion. of the property owned by Jim and Nancy Stubbe at 5750
Covington Load (see Site Location snap — Exhibit A, attached) to accommodate the
improvements. The subject property is zoned P.U.D. (Single- Family) and contains 59,761 square
feet of area. The City proposes to buy the easterly 137 feet of the lot (see Exhibit B), leaving the
Stubbes with 43,995 square feet of area.
ANALYSIS/RECOMMENDATION
This application is about as simple as they come. The newly created parcel will be put to a
public purpose, and the Stubbes' lot will still conform to the zoning requirements for the site
(minimum lot size — 40,000 square feet). Approval of the minor subdivision is recommended.
Cc .. Brian Heck James Landini Tim Keane
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,EGAL DESCRIPTIONS:
'RACT A o5s
- hat part of Lot 3, Block 2, Silver Ridge, on file and of record in the
=ffice of the County Recorder, Hennepin County, Minnesota, which
es northwesterly of the southeasterly most 1 00.00 feet thereof.
'RACT B
'he southeasterly most 100.00 feet of Lot 3, Block 2, Silver Ridge,
n file and of record in the office of the County Recorder, Hennepin
:aunty, Minnesota.
Certificate of Survey
of
Lot 3, Block 2, Silver Ridge.
for:
City of Shorewood, Minnesota
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' *DENOTES FOUND MONUMENT
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I I HEREBY CERTfFY THAT THIS PLAN WAS PREPARED BY ME
❑R UNDER MY DIRECT SUPERVISION AND THAT I AM A DULY a�aawz r
REGISTERED LAND SURVEYOR CINDER THE LAWS OF THE � 701 X8nia Avenue Soulh, Sulln 300
STATE OF MINNESOTA � �If /�� Minnna vwsv bong cam
Kyle L. I(Iasen A�X- ` � '� Y � NA
rS Assncivtes, Inc-
DATE. 6115(1 REG.N0.44606
I NFRASTRUMRE ENGNEERING PUr4N1N0 , ; CW45TRUCP111
.. . - -- ..... .................. - ............. ....... .. . ..... ... -- ..... - .... - - -- .................... ..................... - .......- ..... -... -. .................... ...............................
CITY OF SHOREWOOD
RESOLUTION NO. 11 -042
A RESOLUTION APPROVING A MINOR SUBDIVISION
OF REAL PROPERTY
WHEREAS, James and Nancy Stubbe (Owners) are the owner of certain real property in
the City of Shorewood, County of Hennepin, State of Minnesota, legally described as:
"Lot 3, Block 2, Silver Ridge, on file and of record in the office of the County Recorder,
Hennepin County, Minnesota. "; and
WHEREAS, the City of Shorewood (the Applicant) has agreed to purchase a portion of
Lot 3 for the purpose of making future drainage improvements; and
WHEREAS, the Applicant has applied for a minor subdivision of said real property into
two parcels legally described in Exhibit A, attached hereto and made a part hereof, and
WHEREAS, the minor subdivision requested by the Applicants complies in all respects
with the Shorewood Zoning Code.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of
Shorewood as follows:
1. That the real property legally described herein be divided into two parcels, legally
described in Exhibit A, attached hereto and made a part hereof.
2. That the City Clerk furnish the Applicant with a certified copy of this resolution for
recording purposes.
3. That the Applicant record this resolution with the Hennepin County Recorder or
Registrar of Titles within thirty (30) days of the date of the certification of this resolution.
ADOPTED BY THE CITY COUNCIL OF THE CITY OF SHOREWOOD this 25th day of
July, 2011.
ATTEST:
Christine Lizee, Mayor
Brian Heck, City Administrator /Clerk
EXHIBIT A
Tract A
That part of Lot 3, Block 2, Silver Ridge on file and of record in the office of the County
Recorder, Hennepin County, Minnesota, which is northeasterly of the southeasterly most 100.00
feet thereof.
Tract B
The southeasterly most 100.00 feet of Lot 3, Block 2, Silver Ridge, on file and of record in the
office of the County Recorder, Hennepin County, Minnesota.
2
MEMORANDUM
Date: July 25, 2011
To: Mayor Lizee
Council Members
From: Bruce DeJong, Finance Director
Re: Annual Financial Report
The 2010 audit has been completed and Adam Flaherty from Abdo, Eick & Meyers, LLP will be
here to present the results.
The audit was challenging this year, with me not clearly understanding some of the procedures
used by the former Finance Director. There was one finding that more adjusting journal entries
need to be performed by city staff and that we not rely on the auditors to catch our mistakes.
That certainly will be corrected for next year. With some assistance from the auditors and some
modified internal processes, it should be a much smoother audit next year.
Overall operating results for the governmental funds were positive. We did not use the full
amount of fund balance budgeted to be used in the General Fund. The water and sewer
enterprise funds did not perform as well a hoped, as the combination of a wet year and modified
usage rates drove down operating revenues. Staff will bring back an analysis of these funds as
part of the budget process.
Attachment: Management Letter
Minnesota Legal Compliance Report
Financial Report
9
I�
1
i
ABDO
EICK&
i
•
CITY OF SHOREWOOD
SHOREWOOD, MINNESOTA
r
MANAGEMENT LETTER
FOR THE YEAR ENDED
DECEMBER 31, 2010
?VIM LLP
Certified Public Accountants & Consultants
A DO
3
EICI &
J MEYERS UP
P
ertffied hiblic Accoiintant s & Cou%uliow- Draft Approval Date, 2011
5201 Eden Avenue
Suite 250
Edina, Mid 55436
Management, Honorable Mayor and City Council
City of Shorewood, Minnesota
® I
We have audited the accompanying financial statements of the governmental activities, the business -type activities, each major
fund, the fiduciary fund, and the aggregate remaining fund information of the City of Shorewood, Minnesota (the City) for the year
ended December 31, 2010 and have issued our report thereon dated Draft Approval Date, 2011. Professional standards also
require that we communicate to you the following information related to our audit.
Our Responsibility Under Auditing Standards Generally Accepted in the United States of America
As stated in our engagement letter, our responsibility, as described by professional standards, is to plan and perform our audit to
obtain reasonable, but not absolute, assurance that the financial statements are free of material misstatement and are fairly
presented in accordance with accounting principles generally accepted in the United States of America. Because an audit is
designed to provide reasonable, but not absolute, assurance and because we did not perform a detailed examination of all
transactions, there is a risk that material errors, fraud or illegal acts may exist and not be detected by us.
Our responsibility is to plan and perform the audit to obtain reasonable, but not absolute, assurance that the financial statements
are free of material misstatement. As part of our audit, we considered the internal control over financial reporting of the City.
Such considerations were solely for the purpose of determining our audit procedures and not to provide any assurance concerning
such internal control over financial reporting. We are responsible for communicating significant matters related to the audit that
are, in our professional judgment, relevant to your responsibilities in overseeing the financial reporting process. However, we are
not required to design procedures specifically to identify such matters.
Significant Audit Findings
In planning and performing our audit, we considered the City's internal control over financial reporting as a basis for designing
our auditing procedures for the purpose of expressing our opinions on the financial statements, but not for the purpose of
expressing an opinion on the effectiveness of the City's internal control over financial reporting. Accordingly, we do not express
an opinion on the effectiveness of the City's internal control over financial reporting.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the
normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material
weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a
material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis.
Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this
section and was not designed to identify all deficiencies in internal control over financial reporting that might be deficiencies,
significant deficiencies, or material weaknesses. We consider the deficiency presented as finding 2010 -1 described on the
following page to be a material weakness.
952.835.9090 • Fax 952.&35.3261
HN'ww.cit`.113{'pas. oIli
City of Shorewood
Draft Approval Date, 2011
Page 2
2010 -1 Material Audit Adjustments
Condition: During our audit, adjustments were needed record /allocate money market account
activity, adjust accrued interest, adjust accounts payable, reclassify special
assessment revenue, and record retainage payable on construction contracts, .
Criteria: The financial statements are the responsibility of the City's management.
Cause: The City has not prepared a year -end trial balance reflecting all necessary accounting
entries.
Effect: This indicates that a misstatement may occur and not be detected by the City's system
of internal control over financial reporting. The audit firm cannot serve as a
compensating control over this deficiency.
Recommendation: We recommend that management review the related journal entry, obtain an
understanding of why the entry was necessary and modify current procedures to
ensure that future corrections are not needed.
Management Response: Shorewood experienced a transition between Finance Directors without a completion
of all the 2009 audit entry reversals in 2010. There were also incomplete and
inaccurate journal entries without clear internal guidance on how transactions were
handled. Staff is in process of creating a procedure manual that can be used to guide
future transaction processing that will remove most of the confusion that led to this
audit finding.
Compliance IV
As part of obtaining reasonable assurance about whether the financial statements are free of material misstatement, we performed
tests of compliance with certain provisions of Minnesota statutes. However, the objective of our tests was not to provide an
opinion on compliance with such provisions. We noted no instances of noncompliance with Minnesota statutes.
Planned Scope and Timing of the Audit
We performed the audit according to the planned scope and timing previously communicated to you with the exception of
additional time need to accurately report cash, investments and accounts payable.
Qualitative Aspects of Accounting Practices
Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used
by the City are described in Note 1 to the financial statements. No new accounting policies were adopted and the application of
existing policies was not changed during the year ended December 31, 2010. We noted no transactions entered into by the
governmental unit during the year for which there is a lack of authoritative guidance or consensus. All significant transactions
have been recognized in the financial statements in the proper period.
Accounting estimates are an integral part of the financial statements prepared by management and are based on management's
knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are
particularly sensitive because of their significance to the financial statements and because of the possibility that future events
affecting them may differ significantly from those expected. The most sensitive estimate affecting the financial statements was
capital asset basis and depreciation.
952.835.9090 • Fax 952.&35.3261
HN'ww.cit`.113{'pas. oIli
� City of Shorewood
Draft Approval Date, 2011
�J ►� Page 3
Management's estimate of these accounting estimates is based on estimated or actual historical cost and the estimated useful lives
of capital assets. We evaluated the key factors and assumptions used to develop these accounting estimates in determining that it
is reasonable in relation to the financial statements taken as a whole.
The disclosures in the financial statements are neutral, consistent, and clear. Certain financial statement disclosures are particularly
sensitive because of their significance to financial statement users.
Difficulties Encountered in Performing the Audit
We encountered no significant difficulties in dealing with management in performing and completing our audit.
Corrected and Uncorrected Misstatements
lv�
Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those
that are trivial, and communicate them to the appropriate level of management. Management has corrected all such misstatements.
In addition, none of the misstatements detected as a result of audit procedures and corrected by management were material, either
individually or in the aggregate, to each opinion unit's financial statements taken as a whole. We proposed five journal entries that
we consider to be audit entries or corrections of management decisions. They related to adjustments needed to record /allocate
money market account activity, adjust accrued interest, adjust accounts payable, reclassify special assessment revenue, and record
retainage payable on construction contracts.
We assisted in preparing a number of year end accounting entries. These were necessary to adjust the City's records at year end to
correct ending balances. The City should establish more detailed processes and procedures to reduce the total number of audit and
accounting entries. The City will receive better and timelier information if the preparation of entries is completed internally.
Disagreements with Management #A6
For purposes of this letter, professional standards define a disagreement with management as a financial accounting, reporting, or
auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor's
report. We are pleased to report that no such disagreements arose during the course of our audit.
Management Representations
We have requested certain representations from management that are included in the management representation letter dated
Draft Approval Date, 2011.
Management Consultations with Other Independent Accountants
In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to
obtaining a "second opinion" on certain situations. If a consultation involves application of an accounting principle to the
governmental unit's financial statements or a determination of the type of auditor's opinion that may be expressed on those
statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all
the relevant facts. To our knowledge, there were no such consultations with other accountants.
Other Audit Findings or Issues
We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with
management each year prior to retention as the governmental unit's auditors. However, these discussions occurred in the normal
course of our professional relationship and our responses were not a condition to our retention.
52.835.090 • Fax 9 52.8.15.32 61
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L A ;
Financial Position and Results of Operations
City of Shorewood
Draft Approval Date, 2011
Page 4
Our principal observations and recommendations are summarized below. These recommendations resulted from our observations
made in connection with our audit of the City's financial statements for the year ended December 31, 2010.
General Fund
The General fund is used to account for resources traditionally associated with government, which are not required legally or
by sound principal management to be accounted for in another fund. The General fund balance decreased $28,732 from 2009;
planned use of resources was less than expected. The City Council budgeted for the use of $155,000 of resources. The fund
balance of $3,526,992 is 67 percent of the 2011 budgeted expenditures. We recommend the fund balance be maintained at a
level sufficient to fund operations until the major revenue sources are received in June. We feel a reserve of approximately 50
percent of planned expenditures and transfers out is adequate to meet working capital and small emergency needs. The City
adopted a fund balance policy in 2007 with an objective of 55 -60 percent of the next year's budget.
The Office of the State Auditor (the OSA) has issued a Statement of Position relating to fund balance stating "a local
government should identify fund balance separately between reserved and unreserved fund balance. The local government
may assign and report some or all of the fund balance as designated and undesignated." The Office OSA also recommends
local governments adopt a formal policy on the level of unreserved fund balance that should be maintained in the general and
special revenue funds. This helps address citizen concerns as to the use of fund balance and tax levels. The City adopted a
policy in 2007. 14
The purposes and benefits of a strong fund balance are as follows:
• Expenditures are incurred somewhat evenly throughout the year. However, property tax and state aid revenues are not
received until the second half of the year. An adequate fund balance will provide the cash flow required to finance the
governmental fund expenditures.
• The City is vulnerable to legislative actions at the State and Federal level. The State continually adjusts the local
government aid and property tax credit formulas. We The State has also mandated levy limits for cities. An adequate
fund balance will provide a temporary buffer against those aid adjustments or levy limits.
• Expenditures not anticipated at the time the annual budget was adopted may need immediate Council action. These
would include capital outlay, replacement, lawsuits and other items. An adequate fund balance will provide the
financing needed for such expenditures.
• A strong fund balance will assist the City in maintaining, improving or obtaining its bond rating. The result will be
better interest rates in future bond sales.
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City of Shorewood
Draft Approval Date, 2011
Page 5
A table summarizing the General fund balance in relation to budget follows:
Percent
General of Fund
Fund Balance Budget Fund Balance to
Year December 31 Year Budget Budget
2006 $ 3 2007 $ 5 66 %
2007 3 2008 5 71
2008 3,708 2009 5 68
2009 3 2010 5 66
2010 3,526 2011 ® 4 5,268,884 67
Fund Balance as a Percent of Next Year's Budget
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$5,130,958
$5,319,145 $5,488,562 $5,3751404
$5,268,884
66% 71% 68% 66% 67/0
0
2006 2007 2008 2009
Fund Balance Budget
2010 2011
We have compiled peer group average fund balance information from approximately 120 fourth class cities (populations of
2 — 10,000). The peer group average is derived from information available on the website of the Office of the State
Auditor. In 2009, the average General fund balance as a percentage of expenditures was 63 percent. Based on comparison to
the peer groups, the City's General fund balance is higher than average.
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A
The 2010 operations are summarized as follows:
Revenues
Expenditures
Excess of revenues
over expenditures
Other financing sources (uses)
Transfers in
Transfers out
City of Shorewood
Draft Approval Date, 2011
Page 6
Final
Budgeted Actual
Variance with
Amounts Amounts
Final Budget
$ 5 $ 5
$ (50,520)
4 4
181
809 940,173
131,015
43,842 33
(10,378)
Total other financing sources (uses) (964,158) (968,905) (4
Net change in fund balances (155,000) (28,732) 126
Fund balances, January 1 3,555,724 3 -
Fund balances, December 31 $ 3,400,724 $ 3 $ 126
• The General fund balance decreased $28,732 during the year ended December 31, 2010. More detailed information of
the variances is as follows:
• Revenues were $50,520 under budget. The largest revenue variance was related to interest on investments,
which was under budget by $48,233.
• Expenditures were $181,535 under budget. Many of the functions of the General fund were under budget; the
two largest positive variances were in general government and public works which were under budget by
$127,520 and $33,211, respectively.
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City of Shorewood
Draft Approval Date, 2011
Page 7
A more detailed comparison for the last five years General fund revenues and transfers as follows:
Percent
$450,000
$400,000
$350,000
$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
2006 2007 2008 2009 2010
Licenses and permits Charges for services Fines and forfeitures Interest on investments Other
952.835.9090 • Fax 952.&35.3261
Hlf'ww.ae,,ln{',pas.cozn
of
Per
Source
2006
2007
2008
2009
2010
Total
Capita
Property taxes
$ 4,141,539
$ 4,332,741
$ 4,58202
$ 4,703,368
$ 4,717,204
91.5 %
$ 646
Licenses and permits
382,408
256,472
195,419
12703
154,113
3.0
21
Intergovernmental
4,925
95,901
78,155
66,411
69,134
1.3
9
Charges for services
45,450
50,819
50,753
41,649
4202
0.8
6
Fines and forfeitures
79,040
77,777
53,369
52,968
5506
1.1
8
Special assessments
-
-
-
-
333
-
-
Interest on investments
183,076
257,922
161,862
58,627
46,767
0.9
6
Miscellaneous
12,020
28,761
14,675
24,131
3903
0.8
5
Transfers in
5000
4000
4000
4000
33,464
0.6
5
Total revenues and
transfers in
$ 4,898,458
$ 5,140,393
$ 5,176,835
$ 5,115,037
$ 5,159,506
100.0 %
$ 706
The sources of revenues and transfers from the past
five years are
presented graphically below. Property taxes have
been
excluded from the graph to better illustrate
the fluctuation in the General funds
other revenue sources.
Revenues and Transfers
$450,000
$400,000
$350,000
$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
2006 2007 2008 2009 2010
Licenses and permits Charges for services Fines and forfeitures Interest on investments Other
952.835.9090 • Fax 952.&35.3261
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� City of Shorewood
Draft Approval Date, 2011
�J ►� Page 8
A more detailed comparison for the last five years General fund expenditures and transfers as follows:
Percent Peer Group
of Per Per
Program 2006 2007 2008 2009 2010 Total Capita Capita
General government $ 1,264,509 $ 1,253,080 $ 1,430,354 $ 1,384,712 $ 1,147,198 22.1 % $ 157 $ 129
Public safety 1,257,998 1,263,921 1,352,254 1,392,139 1,392,923 26.8 191 206
Public works 626,048 718,111 760,272 669,578 859,069 16.6 118 113
Culture and recreation 169,411 190,919 229,252 267,407 263,928 5.1 36 50
Capital outlay 529,401 618,859 565,213 528,388 519,792 10.0 71 310
Debt service 50,366 47,900 7,890 5,425 2,959 0.1 - -
Transfers out 610,000 670,000 885,000 1,019,773 1,002,369 19.3 137 -
Total expenditures and
transfers out $ 4,507,733 $ 4,762,790 $ 5,230,235 $ 5,267,422 $ 5,188,238 100.0 % $ 710 $ 808
The above chart compares the amount the City spends per capita, in comparison to a peer group. We have compiled peer
group average fund balance information from approximately 120 fourth class cities (populations of 2,500 to 10,000). The
peer group average is derived from information available on the website of the Office of the State Auditor.
The functional expenditures and transfers from the past five years are presented graphically as follows:
Expenditures and Transfers
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
2006 2007 2008 2009 2010
General government Public safety Public works Transfers out Other
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Debt Service Funds
City of Shorewood
Draft Approval Date, 2011
Page 9
Debt service funds are a type of governmental fund to account for the accumulation of resources for the payment of interest
and principal on debt (other than enterprise fund debt).
Debt service funds may have one or a combination of the following revenue sources pledged to retire debt as follows:
•
PropeLt taxes - Primarily for general City benefit projects such as parks and municipal buildings. Property taxes
may also be used to fund special assessment bonds which are not fully assessed.
• Tax increments - Pledged exclusively for tax increment /economic development districts.
io
• Ca italized interest portion of bond proceeds - After the sale of bonds the project ect ma not produce revenue
p p p � p J Y tax p (
increments or special assessments) for a period of one to two years. Bonds are issued with this timing difference
considered in the form of capitalized interest.
• Special assessments - Charges to benefited properties for various improvements.
In addition to the above pledged assets, other funding sources may be received by Debt Service funds as follows:
• Residual project proceeds from the related capital projects fund
• Investment earnings
• State or federal grants
• Transfers from other funds
The following summarizes the assets of each Debt Service fund with the bonds payable at year end:
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Final
Cash and
Total
Bonds
Maturity
Debt Description
Investments
Assets
Outstanding
Date
2007A Public Safety Building
$ 47
$ 4
$ 3
2023
2007B Public Safety Building
32
4
4
2023
2007C Public Safety Building
12
1
1
2022
2008 Lease Revenue Bond
3
3,208
1
2028
Total
$ 96
$ 9
$ 10
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City of Shorewood
Draft Approval Date, 2011
Page 10
Special Revenue Fund
Special revenue funds receive revenue from specific sources and expenditures for specific purposes. The City's only special
revenue fund is the Southshore Community Center fund. At the end of 2010 the fund had a deficit fund balance or $17,650
and a cash deficit of $2,935.
Capital Projects Funds
Capital projects funds account for the acquisition of capital assets or construction of major capital projects not being financed
by proprietary funds. A summary of year end fund balances (deficits) for all capital projects funds follows:
Fund Balances (Deficits)
December 31,
Fund
Major
Street Reconstruction
Community Infrastructure
Nonmaj or
Public Facilities
Park Capital Improvement
Equipment Replacement
MSA Construction
Technology
City Hall Construction
EDA Public Safety Facilities Project
2010
$ 1
1,867,783
)6,080
)0,3 80
32,105
31,749
)0,754
Total
Following is some of the significant activity:
Street Reconstruction fund
• $1,034,052 of expenditures
•
$712,135 of transfers in from other funds
Community Infrastructure fund
• $854,590 of transfers in from other funds
Park Capital Improvement fund
• $104,200 grant revenue
• $261,980 of expenditures
Equipment Replacement fund
• $100,000 of transfers in from other funds
• $250,306 of expenditures
")nnA
$ 1,619,643 $
1,000,000
227,762
293
842,786
127,671
104,525
(26,255)
tiR '1 Sti
(307,936)
867,783
(31,682)
(103,050)
(110,681)
4,078
(13,771)
26,255
�tiR '� Stil
?0 $ 4,257 $ 262
The City hall Constuction and EDA Public Safety Facilities Project funds were closed with transfers during the year.
Increase
(T1PrrPacPl
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J A ' j
Enterprise Funds
Liquor Funds
City of Shorewood
Draft Approval Date, 2011
Page 11
The inventory balance and the assets of the liquor stores were sold in December 2007. As of December 31, 2010, the
fund was closed with a transfer out of $873,431.
Water Fund
The results of the operations and cash position of the Water fund for the past three years are as follows:
2008 2009
, k I
Total Percent Total Percent Total
Operating revenues
Operating expenses
Operating income
Nonoperating
revenues
Income before transfers
Change in net assets
Cash and cash equivalents
Bonds payable
$ 606,593 100 %
515,187 85
91,406 15
Percent
$ 577,565 100 %
525,061 91
52,504 9
2010
$ 46809 100 %
518,479 111
(49,590) (11)
108,708 18 110,161 19 106,382 23
200,114 33 16205 28 56,792 12
$ 200,114 33 % $ 16205 28 % $ 56,792 12 %
$ 3,774,597 $ 3,557,705 $ 3,751,756
$ 3,41500 $ 3,16500 $ 2,91500
Water Fund
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$-
2008 2009 2010
Operating revenues Operating expenses Change in net assets Cash and cash equivalents
The operating margin decreased during the year. This was primarily due to a decrease in operating revenues. The cash
balance of the fund remains strong and increased due to cash flows provided by operating activities. The City should
continue to monitor operations to ensure charges are sufficient to cover operating expenses, debt service and future
proj ects.
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City of Shorewood
Draft Approval Date, 2011
,$ �Mffi! Page 12
L A
Sewer Fund
The results of the operations and cash position of the Sewer fund for the past three years are as follows:
2008 2009 2010
Operating revenues
Operating expenses
Operating loss
Nonoperating revenues
Income (loss) before transfers
Transfers in
Transfers out
Change in net assets
Cash and cash equivalents
Total
Percent
Total
Percent
Total
Percent
$ 826,867
100 %
$ 801,552
100 %
$ 840,413
100 %
921,238
111
955,956
119
980,173
117
(94,371)
(11)
(154,404)
(19;
(139,760)
(17)
141,442
17
50,844
6
43,070
5
47,071
6
(103,560)
(13)
(96,690)
(12)
-
-
-
-
6000
7
-
-
(1,000,000)
(125)
-
-
$ 47,071
6 %
$ (1,103,560)
138 %
$ (36,690)
5 %
$ 4,476,799
$ 306,489
$ 3,776,321
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$(1,000,000)
$(2,000,000)
The operating margin increased during the current year due to revenues increasing more the expenses did. The cash
balance remains strong. The City should continue to monitor operations to ensure charges are sufficient to cover
operating expenses, debt service and future projects.
9;5.3 5.9090 • Fax 952 M 5.3261
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2008 2009 2010
Operating revenues Operating expenses Change in net assets Cash and cash equivalents
City of Shorewood
Draft Approval Date, 2011
JA'j
Page 13
A -
Recycling Fund
The results of the operations and cash position of the Recycling fund for the past three years are as follows:
2008 2009 2010
Operating revenues
Operating expenses
Operating loss
Nonoperating revenues
Income before transfers
Change in net assets
Cash and cash equivalents
Total
Percent
Total Percent
Total
Percent
$ 64,166
100 %
$ 64,992 100 %
$ 14602
100 %
96,945
151
99,286 #A 153
173,896
119
(32,779)
(51)
(34,294) (53)
(27,894)
(19)
26,324
41
23,936 37
24,216
17
(6,455) (10,358) (3,678)
$ (6,455) 9 % $ (10,358) 16 % $ (3,678) 3 %
$ 96,842 $ 88,814 $ 43,390
Recycling Fund
$200,000
$180,000
$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
There was not sufficient cash generated to cover operating activities, therefore causing the cash balance to decrease
$45,424. We recommend the City monitor cash flows to ensure sufficient resources to cover expenses.
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2008 2009 2010
Operating revenues Nonoperating revenues Operating expenses
City of Shorewood
Draft Approval Date, 2011
JA'j Page 14
Stormwater Management Utility Fund
The results of the operations and cash position of the Stormwater Management Utility fund for the past three years are as
follows:
2008 2009 2010
Total Percent Total Percent Total Percent
Operating revenues
$ 204,345 100 %
$ 191,032
100 %
$ 198,470
100 %
Operating expenses
106,143 52
106,847
56
131,107
66
Operating income
98,202 48
84,185
44
67,363
34
Nonoperating revenues
17,287 8
10,773
6
10,962
6
Income before transfers
115,489 57
94,958
50
78,325
39
Transfers in
- -
-
-
-
-
Transfers out
- -
-
-
-
-
Change in net assets
$ 115,489 57 %
$ 94,958
50 %
$ 78,325
39 %
Cash and cash equivalents
$ 449,792
$ 571,128
$ 665,518
N�n
4 1
0
Stormwater Management Utility Fund
$700 000
$600,000
$500,000
$400,000
$300,000
$200,000
$100,000
$-
2008 2009 2010
Operating revenues Operating expenses Cash and cash equivalents
The cash balance has increased each of the last three years.
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City of Shorewood
Draft Approval Date, 2011
L 1 Page 15
Ratio Analysis
The following captures a few ratios from the City's financial statements that give some additional information for trend and peer
group analysis. The peer group average is derived from information available on the website of the Office of the State Auditor for
Cities of the 4 th class (population 2,500 — 10,000). The majority of these ratios facilitate the use of economic resources focus and
accrual basis of accounting at the government -wide level. A combination of solvency (ability to pay its long -term obligations),
funding (comparison of financial amounts and economic indicators to measure changes in financial capacity over time) and
common -size (comparison of financial data with other cities) ratios are shown below.
Ratio
Calculation
Source
2007
2008
2009
2010
Debt to assets
Total liabilities /total assets
Government -wide
44%
45%
35%
36%
34%
34%
nta
Debt service coverage
Net cash provided by operations/
Enterprise funds
130%
96%
125%
108%
enterprise fund debt payments
181%
163%
261%
n/a
Debt per capita
Bonded debt /population
Government -wide S
3
S
3
S
2
S 1
$
2
$
2 1 677
$
2
n/a
Taxes per capita
Tax revenues /population
Government -wide S
581
S
602
S
626
S 649
$
382
$
401
$
399
n/a
Current expenditures per capita
Governmental fund current
t
Governmental funds S
457
S
497
S
498
S 512
expenditures / population
$
553
$
663
$
625
n/a
Capital expenditures per capita
Governmental fund capital
Governmental funds S
150
S
284
S
258
S 284
outlay / population
$
409
$
323
$
310
n/a
Capital assets % left to
Net capital assets/
Government -wide
34%
32%
31%
31%
depreciate - Governmental
gross capital assets
70%
70%
68%
n/a
Capital assets % left to
Net capital assets/
Government -wide
52%
51%
49%
47%
depreciate - Business -type
gross capital assets
68%
67%
67%
n/a
Represents the City of Shorewood
Peer Group ratio
Debt -to- Assets Leverage Ratio (Solvency Ratio)
The debt -to- assets leverage ratio is a comparison of a city's total liabilities to its total assets or the
percentage of total assets that
are provided by creditors. It indicates
the degree to which the
City's assets are financed through borrowings and other long
-term
obligations (i.e. a ratio of 50 percent would indicate half of the
assets are financed with outstanding debt).
952.8.35.9090 • Fax 95 2.8,E 5.3261
%%'fit % as.C`o.m
Debt Service Coverage Ratio (Solvency Ratio)
City of Shorewood
Draft Approval Date, 2011
Page 16
The debt coverage ratio is a comparison of cash generated by operations to total debt service payments (principal and interest) of
enterprise funds. This ratio indicates if there are sufficient cash flows from operations to meet debt service obligations. Except in
cases where other nonoperating revenues (i.e. taxes, assessments, transfers from other funds, etc.) are used to fund debt service
payments, an acceptable ratio would be above 100 percent.
Bonded Debt per Capita (Funding Ratio)
This dollar amount is arrived at by dividing the total bonded debt by the population of the city and represents the amount of
bonded debt obligation for each citizen of the city at the end of the year. The higher the amount, the more resources are needed in
the future to retire these obligations through taxes, assessments or user fees. The increase in 2007 is due to the refunding bonds
that were issued in 2007 to refund bonds in 2009.
Taxes per Capita (Funding Ratio)
This dollar amount is arrived at by dividing the total tax revenues by the population of the city and represents the amount of taxes
for each citizen of the city for the year. The higher this amount is, the more reliant the city is on taxes to fund its operations.
Current Expenditures per Capita (Funding Ratio)
This dollar amount is arrived at by dividing the total current governmental expenditures by the population of the City and
represents the amount of governmental expenditure for each citizen of the City during the year. Since this is generally based on
ongoing expenditures, we would expect consistent annual per capita results.
Capital Expenditures per Capita (Funding Ratio) L
This dollar amount is arrived at by dividing the total governmental capital outlay expenditures by the population of the City and
represents the amount of capital expenditure for each citizen of the City during the year. Since projects are not always recurring,
the per capita amount will fluctuate from year to year.
Capital Assets Percentage (Common -size Ratio)
This percentage represents the percent of governmental or business -type capital assets that are left to be depreciated. The lower
this percentage, the older the city's capital assets are and may need major repairs or replacements in the near future. A higher
percentage may indicate newer assets being constructed or purchased and may coincide with higher debt ratios or bonded debt per
capita.
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L I A
I l l y
?% 01
Future Accounting Standard Changes
GASB Statement No. 54 - Fund Balance
City of Shorewood
Draft Approval Date, 2011
Page 17
This statement was issued in March of 2009 and is effective for periods beginning after June 15, 2010. This new standard is
intended to improve the usefulness of information provided to financial report users about fund balance by providing clearer,
more structured fund balance classifications, and clarifying the definitions of existing governmental fund types.
GASB No. 54 distinguishes fund balance between amounts that are considered non - spendable, such as fund balance
associated with inventories, and other amounts that are classified based on the relative strength of the constraints that control
the purposes for which specific amounts can be spent. The following classifications and definitions will be used:
• Restricted - amounts constrained by external parties, constitutional provision, or enabling legislation
• Committed - amounts constrained by a government using its highest level of decision - making authority
• Assigned - amounts a government intends to use for a particular purpose
• Unassigned - amounts that are not constrained at all will be reported in the general fund.
In addition to the classifications of fund balance, the standard clarified the definitions of individual governmental fund types,
for example, special revenue funds, debt service funds, and capital project funds.
GASB Statement No. 59 - Financial Instruments Omnibus
Summary
The objective of this Statement is to update and improve existing standards regarding financial reporting and disclosure
requirements of certain financial instruments and external investment pools for which significant issues have been identified
in practice. This Statement provides for the following amendments:
• Statement 31 is clarified to indicate that a 2a7 -like pool, as described in Statement 31, is an external investment pool
that operates in conformity with the Securities and Exchange Commission's (SEC) Rule 2a7 as promulgated under
the Investment Company Act of 1940, as amended.
Statement No. 40, Deposit and Investment Risk Disclosures, is amended to indicate that interest rate risk information
should be disclosed only for debt investment pools such as bond mutual funds and external bond investment
pools that do not meet the requirements to be reported as a 2a7 -like pool.
The provisions of this Statement are effective for financial statements for periods beginning after June 15, 2010. Earlier
application is encouraged.
How the Changes in This Statement Will Improve Financial Reporting
The requirements of this Statement will improve financial reporting by providing more complete information, by improving
consistency of measurements, and by providing clarifications of existing standards. Emphasizing the applicability of SEC
requirements to 2a7 -like external investment pools provides practitioners with improved guidance. Finally, limiting interest
rate risk disclosures for investments in mutual funds, external investment pools, and other pooled investments to debt
investment pools provides better guidance regarding the applicability of interest rate risk disclosures.
952.835.9090 • Fax 952.&35.3261
HN'ww.cit`.113{'pas. oIli
City of Shorewood
Draft Approval Date, 2011
Page 18
This report is intended solely for the information and use of the Council, management and the Minnesota Office of the State
Auditor and is not intended to be and should not be used by anyone other than these specified parties.
Our audit would not necessarily disclose all weaknesses in the system because it was based on selected tests of the accounting
records and related data. The comments and recommendations in the report are purely constructive in nature, and should be read
in this context.
If you have any questions or wish to discuss any of the items contained in this letter, please feel free to contact us at your
convenience. We wish to thank you for the opportunity to be of service and for the courtesy and cooperation extended to us by
your staff.
Draft Approval Date, 2011
Minneapolis, Minnesota
ABDO, EICK & MEYERS, LLP
Certified Public Accountants
952.835.9090 • Fax 952.&35.3261
HN'ww.cit`.113{'pas. oIli
CITY OF SHOREWOOD
SHOREWOOD, MINNESOTA
MINNESOTA LEGAL COMPLIANCE
AND
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
BASED ON AN AUDIT OF FINANCIAL STATEMENTS
FOR THE YEAR ENDED
1
ABDO
EICK
LLP
a W Nblic Accountants & Consultants
.rt.v
DECEMBER 31, 2010
ABDO
EICK&
lH1 _ LLP
A tblic Accountants & C onsultants
5201 Eden Avenue
Suite . 1 50
Edina, MN 55436
REPORT ON MINNESOTA LEGAL COMPLIANCE
Honorable Mayor and Council
City of Shorewood, Minnesota
We have audited the accompanying financial statements of the governmental activities, the business -type activities, each major
fund and the aggregate remaining fund information of the City of Shorewood, Minnesota (the City) as of and for the year ended
December 31, 2010, and have issued our report thereon dated Draft Approval Date, 2011, which collectively comprise the City's
basic financial statements.
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the
provisions of the Minnesota Legal Compliance Audit Guide for Local Government, promulgated by the Minnesota Office of the
State Auditor pursuant to Minnesota statutes, section 6.65. Accordingly, the audit included such tests of the accounting records
and such other auditing procedures as we considered necessary in the circumstances.
The Minnesota Legal Compliance Audit Guide for Local Government covers seven main categories of compliance to be tested:
contracting and bidding, deposits and investments, conflicts of interest, public indebtedness, claims and disbursements, tax
increment financing and miscellaneous provisions. Our study included all of the listed categories.
The results of our tests indicate that for the items tested, the City complied with the material terms and conditions of applicable
legal provisions.
This report is intended solely for the information and use of management, the Council, others within the City and the Minnesota
Office of the State Auditor and is not intended to be and should not be used by anyone other than these specified parties.
Draft Approval Date, 2011 ABDO, EICK & MEYERS, LLP
Minneapolis, Minnesota Certified Public Accountants
952.835.9 90 -P Fax 9UR35.3 61
www.aeiiiepas.c oni
A ABDO
EICIK&
0 J o
_ HT
Certified hibl ic Accoiintants & Comultanis
5201 Eden Avenue
Suite 250
Edina, I'vtlti 55436
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
BASED ON AN AUDIT OF FINANCIAL STATEMENTS 10
Honorable Mayor and Council
City of Shorewood, Minnesota
In planning and performing our audit of the financial statements of the governmental activities, the business -type activities, each
major fund, and the aggregate remaining fund information of the City of Shorewood, Minnesota (the City) as of and for the year
ended December 31, 2010, in accordance with auditing standards generally accepted in the United States of America, we
considered the City's internal control over financial reporting as a basis for designing our auditing procedures for the purpose of
expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the
City's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the City's
internal control over financial reporting.
Our consideration of internal control over financial reporting was for the limited purpose described in the preceding paragraph
and was not designed to identify all deficiencies in internal control over financial reporting that might be significant deficiencies
or material weaknesses and therefore, there can be no assurance that all such deficiencies have been identified. However, as
discussed below, we identified certain deficiencies in internal control over financial reporting that we consider to be material
weaknesses.
A deficiency in internal control over financial reporting exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct
misstatements on a timely basis. A material weakness is a deficiency or combination of deficiencies in internal control, such that
there is a reasonable possibility that a material misstatement of the City's financial statements will not be prevented, or detected
and corrected on a timely basis. We consider the deficiency presented as finding 2010 -1 in the Schedule of Findings and
Responses to be a material weakness.
A significant deficiency is a deficiency, or a combination of deficiencies, in internal control over financial reporting that is less
severe than a material weakness, yet important enough to merit attention by those charged with governance. Other than finding
2010 -1, we did not identify any significant deficiencies.
952.835.9090 * Fax 952M5.3261
www.aemepas.com
We noted certain matters that we reported to management of the City in a separate letter dated Draft Approval Date, 2011.
The City's responses to the findings indentified in our audit are described in the accompanying Schedule of Findings and
Responses. We did not audit the City's responses and, accordingly, we express no opinion on them.
This report is intended solely for the information and use of the Council, management and the Minnesota Office of the State
Auditor and is not intended to be and should not be used by anyone other than these specified parties.
Draft Approval Date, 2011
Minneapolis, Minnesota
ABDO, EICK & MEYERS, LLP
Certified Public Accountants
WW I
952.835.9090 9 Fax 952.8.35.3261
www.acmepas.com
CITY OF SHOREWOOD
SCHEDULE OF FINDINGS AND RESPONSES
DECEMBER 31, 2010
Findin Description
2010 -1 Material Audit Adjustments
Condition: During our audit, adjustments were needed record /allocate money market account
activity, adjust accrued interest, adjust accounts payable, reclassify special assessment
revenue, and record retainage payable on construction contracts, .
Criteria: The financial statements are the responsibility of the City's management.
Cause: The City has not prepared a year -end trial balance reflecting all necessary accounting
entries.
Effect: This indicates that a misstatement may occur and not be detected by the City's system of
internal control over financial reporting. The audit firm cannot serve as a compensating
control over this deficiency.
Recommendation: We recommend that management review the related journal entry, obtain an
understanding of why the entry was necessary and modify current procedures to ensure
that future corrections are not needed.
Management Response: Shorewood experienced a transition between Finance Directors without a completion of
all the 2009 audit entry reversals in 2010. There were also incomplete and inaccurate
journal entries without clear internal guidance on how transactions were handled. Staff is
in process of creating a procedure manual that can be used to guide future transaction
processing that will remove most of the confusion that led to this audit finding.
4
CITY OF SHOREWOOD
SHOREWOOD, MINNESO'
ANNUAL FIN
FOR THE YEAR E
DECEMBER 31,
/CLERK
_:EASURER
MEMBER OF GOVERNMENT FINANCE OFFICERS ASSOCIATION
OF THE UNITED STATES AND CANADA
CITY OF SHOREWOOD, MINNESOTA
TABLE OF CONTENTS
DECEMBER 31, 2010
Nonmaj or Proprietary Funds
Combining Statements of Net Assets C -1
Combining Statements of Revenues, Expenses and Changes in Fund Net Assets C -2
Combining Statements of Cash Flows C -3
INTRODUCTORY SECTION
Exhibit Page No
Elected and Appointed Officials 5
Organization Chart 6
Letter of Transmittal 7
Certification of Achievement for Excellence in Financial Reporting 12
FINANCIAL SECTION
Independent Auditor's Report 15
Management's Discussion and Analysis 19
Government -wide Financial Statements
Statement of Net Assets
1
33
Statement of Activities
, 2
34
Fund Financial Statements
Governmental Funds
Balance Sheet
3
38
Reconciliation of the Balance Sheet to the Statement of Net Assets
4
41
Statement of Revenues, Expenditures and Changes in Fund Balances
5
42
Reconciliation of the Statement of Revenues, Expenditures
and Changes in Fund Balances to the Statement of Activities
6
44
General Fund
Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
7
45
Proprietary Fund
Statements of Net Assets
8
46
Statements of Revenues, Expenses and Changes in Fund Net Assets
9
48
Statements of Cash Flows, -
10
50
Fiduciary Fund
Statement of Net Assets
11
54
Notes to the Financial Statements
55
Nonmajor Governmental, Funds
Combining Balance Sheet A -I 82
Combining Statement of Revenues, Expenditures and Changes in Fund Balances (Deficits) A -2 83
Nonmajor Capital Projects Funds
Combining Balance Sheet B -1 86
Combining Statement of Revenues, Expenditures and Changes in Fund Balances (Deficits) B -2 88
General Fund
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Debt Service Funds
Combining Balance Sheet
Combining Schedule of Revenues, Expenditures and Changes in Fund Balances
92
94
96
D -1 99
E -1 104
E -2 106
-1-
CITY OF SHOREWOOD, MINNESOTA
TABLE OF CONTENTS - CONTINUED
DECEMBER 31, 2010
FINANCIAL SECTION - CONTINUED
Combining and Individual Fund Statements and Schedules
Agency Fund
Combining Schedule of Changes in Assets and Liabilities
Supplementary Information (Unaudited)
Summary Financial Report
Revenues and Expenditures for General Operations - Governmental Funds
STATISTIC
Net Assets
Changes it
Fund Bala
Changes it
Tax Capac
Property T
Principal I
Property 'l
Ratio of
Ratios of (
Computati
Legal Deb
Pledged -R
Demograp
Principal I
Full -Time
Operating
Capital As
Exhibit Page No
F -1 108
G -I 111
116
118
122
124
126
128
130
132
133
134
135
136
138
139
140
142
143
144
-2-
INTRODUCTORY
CITY OF SHOREWOOD
SHOREWOOD, MINNESOTA
hTS10-u
-3-
-4-
Name
Christine Lizee
Jeffery Bailey
Laura Turgeon
Richard Woodruff
Scott Zerby
Name
Brian Heck
Bruce DeJong
CITY OF SHOREWOOD, MINNESOTA
ELECTED AND APPOINTED OFFICIALS
DECEMBER 31, 2010
Title
Mayor
Council Member
Council Member
Council Member
Council Member
APPOINTED
Title
City Administrator
Finance Director /Treasurer
Term Expires
12/31/12
12/31/10
12/31/10
12/31/12
12/31/12
-5-
JPA
Police
Fire
LMCD
LMCC
Finance Dir
Sr Acct Clerk
IT /Phones
Island Fire
Assessor
Recycling
Park /Recreation
Community Center
Plan /Zone Dir
Planning, Bldg
Asst Official
Residents
Council
Administrator
Deputy Clerk
Recep-
tionist
Comm
Coord
Web
Tech
Advisory Boards
Plan Commission
Park Commission
Attorney
Engineer M Pub Works Dir
Utiliites
Parks -
Ma int.
Streets
CITY OF SHOREWOOD, MINNESOTA
ELECTED AND APPOINTED OFFICIALS
DECEMBER 31, 2010
Name
Christine Liz&
Jeffery Bailey
Laura Turgeon
Richard Woodruff
Scott Zerby
Name
Brian Heck
Bruce DeJong
Title
Mayor
Council Member
Council Member
Council Member
Council Member
APPOINTED
Title
City Administrator
Finance Director /Treasurer
Term Expires
12/31/12
12/31/10
12/31/10
12/31/12
12/31/12
-5-
the fiscal
lance with
blished by
;c of State
the City.
lity of the
sentations,
ssets from
financial
tweigh the
r absolute,
ement, we
iable in all
The City of Shorewood's financial statements have been audited by the firm of Abdo, Eick &
Meyers, LLP, Certified Public Accountants. The goal of the audit was to provide reasonable
assurance that the financial statements of the City for the year ended December 31, 2010, are free of
material misstatement. The independent audit involved examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing the accounting
principles used and significant estimates used by management; and evaluating the overall financial
statement presentation. Based upon the audit, the independent auditor concluded that there was
reasonable basis for rendering an unqualified opinion that the City's financial statements, for the
-7-
material respects.
year ended December 31, 2010, are fairly presented in conformity with GAAP. The independent
auditor's report is presented at the front of the financial section of this report.
GAAP requires 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). The City's MD &A can be found in the financial section of this report immediately
following the independent auditor's report.
City Profile
The City of Shorewood is a suburban community located
southern shore of Lake Minnetonka, a setting of rolling h
Shorewood has a convenient location, a comprehensive syst(
from downtown Minneapolis and St. Paul and the Mime
The City is predominantly a residential community with li
commercial shopping malls. The City is 6 square miles in a
7,307 as of 2010. The City, which is currently 95% dev
growth in its residential base but because of the limited 'a
growth will come slowly through small developments.
Incorporated in 1956 as a City, the City of Shc
form of government. Policy making and legis
consisting of the mayor and four - member council
serve four -year staggered terns, with two counc
elected to serve a two -year term. The ('ity Ad
day -to -day operations of the governmenm„and to
and effective delivery of _City services:
pst of the Twin Cities on the
picturesque lakes and creeks.
ghways, and is a short distance
it. Paul. International Airport,
ommercial. businesses and two
had an estimated population of
continues to experience some
ty of large tracts of land, this
are vested in a governing council
n- partisan basis. Council members
ed every two years. The mayor is
< is responsible for overseeing the
bility to City staff for the efficient
The Economic Development Authority (EDA)„ of the City was created in 2001 pursuant to
Minnesota Statutes to carry out economic and industrial development and redevelopment consistent
with policies established by the Council. Its board is comprised of members of the City Council.
The EDA activities are blended and separate financial statements are not issued for this component
unit: .
The City provides`its residents and businesses with a broad range of municipal services consisting of
police and fire protection, street maintenance, recreation programs, park maintenance, community
and economic development, and administrative services, including building inspections. During
2010, the City operated four enterprises: a water utility; sanitary sewer; recycling; and storm water
management utilities. The City discontinued its off -sale liquor operation when it sold the two liquor
store locations to privatei nvestors. The City Council has transferred the remaining funds from the
liquor store sale to the Community Infrastructure fund to be used for projects of community -wide
benefit.
Economic Conditions and Outlook
Governance
The City Council, in its leadership role, has effectively established a focus for government in
Shorewood and has established overall goals and expectations for the City. The Council's calendar
consists of three phases. The first phase is planning; it includes review of the previous year's work
plan and identifies goals and priorities for the next twelve months.
The second phase is capital finance planning; each year the five -year Capital Improvement Program
is reviewed and updated based upon priorities established in the first phase.
The third phase is budgeting; the annual operating budget is developed based on decisions made in
the first two phases. The annual budget serves as the foundation of the City of Shorewood's
financial planning and control. Departments submit budget requests to Finance in June and the City
Administrator presents the proposed budget to the City Council for review prior to September 15"' of
each year. Budget work - sessions are held with the City Council in July and August. The City
Council holds a Truth -in- Taxation public hearing on the proposed budget and adopts the final
budget in December each year.
The budget is prepared by fund, and function. The City's department directors develop their
budgets, with subsequent review and input from the City Administrator and Finance Director. Any
changes in the total budget must be approved by the City Council.
Cooperative Public Service Delivery
Shorewood is committed to working cooperatively with other Lake Minnetonka area cities to
carefully consider methods to efficiently deliver public services. T1te City has various contractual
arrangements with other governmental jurisdictions and with private entities for providing many of
these services. The City is also involved in cooperative enmployee training", "disaster preparedness and
other areas of mutual concern as an active participant in the ake Minnetonka area.
The City of Shorewood, along with the cities of Excelsior, Deephuven, Greenwood and Tonka Bay,
has been a member of the Excelsior Fire District since 2000. The Excelsior Fire District is a joint
powers organization. A combined pglice,and fire public,safety building that serves the South Lake
Minnetonka Area cities was completedaitlate 2003.
The City has been a member'city'of.the Soath'Lake Minnetonka Police Department (SLMPD) since
its inception in 1973. The other'members'clfthis' joint powers organization are the cities of
Excelsior, Greenwood, and Tonka Bay:
The `City conkracts with Hennepin County for property assessment services. The Hennepin County
Assessor analyzes property sales information, sets taxable values, and handles the valuation appeal
process.
Debt Administration
As of December 31, 2010, the City's debt outstanding totaled $13,710,000. Of this total, $2,915,000
is General Obligation Water Revenue bonds issued in 1995, 2003, 2005, and 2006. The proceeds
from these bonds financed water system extensions and improvements and will be repaid from
special assessments and water rate revenues.
The remaining outstanding debt balance of $10,795,000 is EDA Lease Revenue Advance Refunding
bonds issued in 2007 for the public safety buildings and EDA Lease Revenue bonds issued in 2008
for remodeling City Hall. These bonds will be repaid from lease payments from the Excelsior Fire
District, South Lake Minnetonka Police Department, and the city of Shorewood.
The City of Shorewood's bond rating was upgraded to Aa2 from Aa3 in July, 2008, by Moody's
Investors Service. At that time, Moody's also upgraded the Shorewood Economic Development
Authority (EDA) bond rating to Aa3 from A1, based upon the City's pledge to make the lease
0
payments subject to annual appropriation in the City's operating budget, and the fact that a city hall
facility is an essential part of a municipality.
Long -term Financial Planning
The City has implemented various financial /budgetary policies to guide the City Council and staff
when making financial decisions to ensure the long -term stability and flexibility of City finances and
operations. These policies include the following:
• The original budget should be balanced with revenues
• The City will designate as fund balance for working c
the next years' tax levy, in accordance with the Generr,
Council. This policy ensures the long -term econo;
providing adequate working capital given the peri
providing for unexpected shortfalls or emergeneieR
budgeted use of General Fund reserves in 2010 was $1
• The City will maintain a five -year capital improveir
acquisition, maintenance, replacement, and retirement.
• The City will continue to aecumr
improvement projects with operating
Budgeted transfers for capital improves
Major Initiatives
The City updated its
overview of demogr,
shape the community
which was i
;ends points
oil and the surrouri
diversity will inert
jority of Baby I
lately seven years.
rg on location and
pressure.
Other initiatives during
region
expenditures,
the General Fund 50 -60% of
3alance Policy adopted by the
iility,'of the organization by
:ure of tax receipts and by
ecordance with this policy,
to provide for capital asset
for future capital equipment and
ions capital project funds in 2010.
ring 2010 were $842,000.
d to the Metropolitan Council. An
tuber of important: factors that will
increased traffic congestion
and Minnesota as a whole.
will reach `official" retirement age of 65 within
demand, some properties may experience redevelopment
the following:
The City of Shorewood took over the operations of the Southshore Community Center in
2009 and operated it for the entire year of 2010.. The Center was built in the late 1990's as
a joint venture by the following five Lake Minnetonka Area Cities: Shorewood, Excelsior,
Tonka Bay, Deephaven and Greenwood. Until recently, the center was leased to an
organization that emphasized senior programming. Many of the senior - oriented programs
still remain during the day, and these are a critical component, but center renovations were
made to attract new renters, including businesses, community education classes, and
wedding, birthday, and graduation parties. Shorewood has contracted with new
management for the Southshore Center, and after minor updates to the facility, new
programs have been developed to attract all ages. The Southshore Center's revived use by
community residents of all ages has generated new enthusiasm and participation.
to-
The City of Shorewood adopted a 20 year road reconstruction plan in 2010. Specifically,
the goal of the program is to repair through reconstruction or reclamation, roads that score
two (2) or Lower on the PASER evaluation system. The Council directed staff to evaluate
methods for funding the program. Staff is reviewing various options including transfers
from other funds and increased tax levies. It is expected that implementation of this
program will commence in 2011.
The City Council added to the Community Infrastructure Fund by transferring the liquor
store sale proceeds into this fund for use in infrastructure projects benefitting the City as a
whole.
Certificate of Achievement
The Government Finance Officers Association of the United States a
Certificate of Achievement for Excellence in Financial Reporting to
comprehensive annual financial report (CAER) for the fiscal year end
The Certificate of Achievement is a prestigious national award iec�
highest standards for preparation of state and local government fit
awarded a Certificate of Achievement, a government unit must F
efficiently organized comprehensive annual financial report whose
standards. Such comprehensive annual financial' report, must so
accounting principles and applicable legal
A Certificate of Achievement is valid for a period`
a Certificate of Achievement for the past sevenl
report continues to conform to the Certificate of
submitting it to the GFOA to determine,its eligibili
We
Mayor ai
financial
Respectfully
to express our apr
their contribution t
Gil members for the
ons of the City in a
Brian W. Heck
City Administrator /Clerk
a (GFOA) awarded a
of Shorewood for its
her 31, 2009.
conformance with the
reports. In order to be
an easily readable and
Is conform to program
oth generally accepted
of Shorewood has received
. We believe our current
program requirements, and we are
certificate.
to the employees of the Finance and Administration
aration of this report. We would also like to thank the
zed interest and support in planning and conducting the
and progressive manner.
Bruce M. DeJong
Finance Director /Treasurer
-11-
Presented to
f M !' ! M
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
December 31, 2409
A Certificate of Achievement for Excellence in Financial
Reporting is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and financial reporting.
President
*e:�W AI
Executive Director
-12-
FINANCIAL
CITY OF SHOREWOOD
SHOREWOOD, MINNESOTA
hTIM 1 M
-13-
14-
L0 l�0 EICK &
_ ME l ERS LLP
Owi Puhh( Accowaaws & Catwhanis
5201 Um Avenue
Suite 250
Edina, NTN' 55436
INDEPENDENT AUDITOR'S REPORT
Honorable Mayor and Council
City of Shorewood, Minnesota
We have audited the accompanying financial statements of the government
fund, and the aggregate remaining fund information of the City of Shorewc
December 31, 2010, which collectively comprise the City's basic financial
financial statements are the responsibility of the City's management. Our rl
statements based on our audit. The prior year's comparative information hE
statements and, in our report dated May 25, 2010; we expressed unqualifiei
statements.
We conducted our audit in accordance with auditing standards generally accept
standards require that we plan and perform the audit to obtain reasonable assur
free of material misstatement. An audit includes examining, on a test basis, evi
the financial statements. An audit also includes assessing the accounting prmnc
management, as well as evaluating the overall financial statement presentation.
basis for our opinions.
1ties, the business -type activities, each major
nnesota,(the City), as of and for the year ended
ants as listed in the table of contents. These
bility is to express opinions on these financial
derived frbmthe City's 2009 financial
ins on the respective proprietary fund financial
ad in the United States of America. Those
tine about whether the financial statements are
lence supporting the amounts and disclosures in
>les used and significant estimates made by
We believe that our audit provides a reasonable
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of
the governmental ac#bjties, the business-type activities, each major fund, and the aggregate remaining fund information of the
City as of December 31, 2010, and the respective changes in financial position and cash flows, where applicable, thereof and the
budgetary comparison forthe General fund for the year then ended in conformity with accounting principles generally accepted in
the United States of America.
Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis
on pages 19 through 29 be presented to supplement the basic financial statements. Such information, although not a part of the
basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part
of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We
have applied certain limited procedures to the required supplementary information in accordance with auditing standards
generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing
the information and comparing the information for consistency with management's responses to our inquiries, the basic financial
statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or
provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an
opinion or provide any assurance.
952835.9090 - Fax 952.835.3261
mmaemcpas.con,
15-
-16-
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City's
basic financial statements as a whole. The introductory section, combining and individual fund financial statements and
schedules, supplementary information, and statistical section are presented for purposes of additional analysis and are not a
required part of the financial statements. The combining and individual fund financial statements and schedules are the
responsibility of management and were derived from and relate 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 basic
financial statements and certain additional procedures, including comparing and reconciling such information directly to the
underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and
other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our
opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole. The introductory
section, supplementary information, and statistical sections have not been subjected to fie auditing procedures applied in the audit
of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on them.
Draft Approval Date, 2011
Minneapolis, Minnesota
Public
LLP
938.835.4090 • Fax 952.835.3261
,vuvm.aemcpas.com -17-
-18-
Draft Approval Date, 2011
Management's Discussion
As management of the City of Shorewood, Minnesota, (the City), we of
overview and analysis of the financial activities of the City for the fiscal
Financial Highlights
• The assets of the City exceeded its liabilities at the close of the most recent
this amount, $16,918,646 (unrestricted net assets) may be used to meet the
creditors.
• The City's total net assets decreased $381,294, solely
statements this narrative
by $32,939,633 (net assets). Of
ng,obligations to residents and
• As of the close of the current fiscal year, the City's governmental funds reported combined ending fund balances of
$8,126,233, a decrease of $1,616,989 in comparison with the prior year: `This decrease is primarily the result of
$1,900,000 of refunded bonds. Approxftn4e3y,98 percent of this Ygtal amount, $7,980,840, is available for spending at
the City's discretion.
• At the end of the current fiscal year, unreserved fund balance for the General fund was $3,477,932, or 66 percent of total
2011 budgeted expenditures. While t se'funds are notlegally reserved, they are designated for future purposes.
® The City's total debt decreased $2,750,000, or 17 percent during the current fiscal year. The key factor in this decrease
was lease revenue bonds that were refunded in the amount of $1,900,000 and annual debt service payments.
Overview of the
This discussion and analysis is intended to serve as an introduction to the City's basic financial statements. The City's basic
financial statements comprise three components: 1) government-wide financial statements, 2) fund financial statements, and 3)
notes to the financial statements. This report also contains other supplemental information in addition to the basic financial
statements themselves.
on
The financial statements also include notes that explain some of the information in the financial statements and provide more
detailed data. The statements are followed by a section of combining and individual fund financial statements and schedules that
further explains and supports the information in the financial statements. Figure 1 shows how the required parts of this annual
report are arranged and relate to one another. In addition to these required elements, we have included a section with combining
and individual fund financial statements and schedules that provide details about nonmajor governmental funds, which are added
together and presented in single columns in the basic financial statements.
Figure 1
Required Components of the
City's Annual Financial Report
Management's
Basic Financial
Required
Discussion and
Statements
I
Supplementary
Analysis
Information
Government -wide 1 ] Fund I Notes to the
Financial Financial Financial
Statements Statements Statements
Summary Detail
-20-
Figure 2 summarizes the major features of the City's financial statements, including the portion of the City government they
cover and the types of information they contain. The remainder of this overview section of management's discussion and analysis
explains the structure and contents of each of the statements.
Figure 2
Major features of the Government -wide and Fund Financial Statements
Statements
The government -wide fimutcial statements are
manner similar to a private- sector business.
The statement of net assets presents
reported as net assets. Over time, ii
position of the City is improving or
to provide readers with a broad overview of the City's finances, in a
n on all of the City's assets and liabilities, with the difference between the two
decreases in net assets may serve as a useful indicator of whether the financial
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 revenue (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 interest on long -term debt. The business -type activities of
the City include water, sewer, recycling, stormwater management utility and liquor operations.
-21-
Fund Financial Statements
Government -wide
Governmental Funds
Proprietary Funds
Statements
Scope
_
Entire City government
The activities of the City that
Activities the City operates
(except fiduciary funds) and
are not proprietary or
similar to private businesses,
the City's component units
fiduciary, such as police, fire
such as the water and sewer
and arks
system
Required financial
m Statement of Net Assets
• Balance Sheet
• Statements of Net Assets
statements
. Statement of Activities
• Statement of Revenues;
• Statements of Revenues,
Expenditures, and'''; - '
Expenses and Changes in
Changes in Fund
Fund Net Assets
Balances
Statements of Cash
Flows',
Accounting Basis and
Accrual accounting and
Modified aeurual accounting
Acctval accounting and
measurement Focus
economic resources focus
and current financial'-,'.1
economic resources focus
resources focus
Type of asset/liability
All assets and liabilities, both
Only assets expected to he
. AH assets and liabilities, both
information
financial and capital, and
used up and liabilities that - .
' financial and capital, and
short-term and long - term >.
come dmi'during the year,
short-term and long -term
-soon thereafter no capital
Assets include3'';. ,','_
Type of in flow /out flow
All revenues and expenses
Revenues for yybich`cash is
All revenues and expenses
information
during year, regardiless of
recelsed,during or soon after
during the year, regardless of
when cash is received or paid
the end of the year;
when cash is received or paid
expenditures when goods or
services have been received
and payment is due during
the year or soon thereafter
Statements
The government -wide fimutcial statements are
manner similar to a private- sector business.
The statement of net assets presents
reported as net assets. Over time, ii
position of the City is improving or
to provide readers with a broad overview of the City's finances, in a
n on all of the City's assets and liabilities, with the difference between the two
decreases in net assets may serve as a useful indicator of whether the financial
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 revenue (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 interest on long -term debt. The business -type activities of
the City include water, sewer, recycling, stormwater management utility and liquor operations.
-21-
The government -wide financial statements include not only the City itself (known as the primary government), but also a legally
separate Economic Development Authority (EDA) for which the City is financially accountable. The EDA, although legally
separate, functions for all practical purposes as a department of the City, and therefore has been included as an integral part of the
primary government.
The government-wide financial statements start on page 33 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 fiords, 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 -tern¢ inflows and outflows ofspendable resources, as well as on balances ofspendable
resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near -term
financing requirements.'
Because the focus of governmental funds is narrower than that of the government
compare the information presented for governmental funds with similar informati
government -wide financial statements. By doing so, readers may better undetstal
near -term financing decisions. Both the governmental fund balance sheet and the
expenditures and changes in fund balances provide a reconciliation to facilitate th
governmental activities.
The City maintains 12 individual governmental funds. Information is
sheet and in the governmental fund statement of revenues, expenditur
Debt Service, Street Reconstruction and Community Infrastructure fu
other 8 governmental funds are combined into a single, aggregated pr
governmental funds is provided in the form of combining statements
The City adopts an annual appropriated budget fo`r its General fund. A
General fund to demonstrate compliance with this budget: ..
The basic governmental fund financial statements start on page 38 of this report.
al statements, it is useful to
for governmental activities in the
rm impact by the government's
it fund statement of revenues,
1 between governmental funds and
Li the governmental fund balance
balances (deficits) for the General,
red to be major funds. Data from the
fund data for each of these nonmajor
in this report.
comparison statement has been provided for the
Proprietary funds. The City maintains one type of proprietary -fund. Enterprise funds are used to report the same functions
presented as business- (ype,activities in the government-wide financial statements. The City uses enterprise funds to account for
its water, sewer, recycling, stormwater management utility and liquor operations.
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 each of the enterprise funds which are considered to be
major funds of the City.
The basic proprietary fund financial statements start on page 46 of this report
Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties outside the City. 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 statements can be found on page 54 of this report.
Notes to the Financial Statements
The notes provide additional information that is essential to a full understanding of the data provided in the government -wide and
fund financial statements. The notes to the financial statements start on page 55 of this report.
-22-
Other Information
The combining statements referred to earlier in connection with nonmajor governmental fiords are presented following the notes
to financial statements. Combining and individual fund financial statements and schedules starts on page 82 of this report.
Government -wide ,Financial Analysis
As noted earlier, net assets may serve over time as a useful indicator of a government's financial position. In the case of the City,
assets exceeded liabilities by $32,939,633 at the close of the most recent fiscal year.
Of the City's net assets (49 percent) reflects its investment in capital assets (e.g., land, buildings, machinery and equipment), 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 fitture spending. Although the City's investment in its capital assets is
reported net of elated debt, it should be noted that the resources needed to repay this debt must be provided from other sources,
since the capital assets themselves cannot be used to liquidate these liabilities. ,
Summary of Net
Governmental Activities
Inc
2010 2009 (Dec
Assets
Cash and
temporary investments
Cash with fiscal agent
Receivables
Internal balances
Prepaids
Deferred charges
Capital assets
Total assets
Liabilities
Noncurrent
Other liabil
Total liabilities
Net assets
Invested in capital assets,
net of related debt
Unrestricted
Total net assets
$ 8,125,269
$ 8,324,911
7,375
1,909,864
9,965,080
10,530,707
-
(60,000
49,060
2,837
166,883
178,568
10,765,991
, ]b,765,314
1.0,984,878
316,292
70
18,365,541 19,275,515 (909,974)
733 (2,503,855) 2,915,000 3,165,000 (250,000)
048 (457,756) 289,396 179,008 110,388
781 (2,961,611) 3,204,396 3,344,008 (139,612)
1 9,480,314 45,677 6,494,996 6,482,297 12,699
7 7,909,106 343,391 8,666,149 9,449,210 (783,061)
$ 17,778,488 17,389,420 $
$ 389,068 $ 15,161,145 $ 15,931,507 $ (770,362)
The balance of unrestricted net assets is $16,918,646. This maybe used to meet the City's ongoing obligations to citizens and
creditors.
Activities
Increase
(Decrease)
_1(199,442)
$ 8,123,977
$` 8,632,487
$ (508,510)
(1,902,489)
113,008
114,058
(1,050)
(565,627)
656,693
738,500
(81,807)
60,000
-
60,000
(60,000)
46,223
-
13,041
(13,041)
i(11,685)
61,867
70,132
(8,265)
,577
' 9,409,996
9,647,297
(237,301)
-23-
Governmental activities. Governmental activities increased the City's net assets by $389,068. Key elements of this increase are
as follows:
Changes in Net Assets
Governmental Activities Business -type Activities
Increase Increase
2010 2009 (Decrease) 2010 2009 (Decrease)
Revenues
(482,005)
Program revenues
43,069
Charges for services
$ 736,372 $ 710,928 $
Operating grants
1,040,000
and contributions
99,114 90,681
Capital grants
31,130
and contributions
114,330 43
General revenues
(770,362)
Property taxes
4,744,348 4,743,174
Grants and contributions
(482,005)
not restricted to
43,069
specific programs
4,487
Unrestricted investment
1,040,000
earnings
132,359
Gain on sale of capital assets
31,130
389,068
Total revenues
5,862,140
Expenses
General government
Public safety
Public works
Culture and recreation
Interest on long -term f
Water
Sewer
Recycling `
Stormwater managem¢
Liquor
1,235,098
Total expenses
Increase (decrease) in net assets
before transfers
Transfers
Change in net assets
Net assets, January 1
Net assets, December 31
(17,753)
(2,004)
3 (15,227)
7ov,i /J y»,7J6 24,217
173,896 99,286 74,610
131,107 106,847 24,260
- - 25 129 (104)
6,365,397 (78,894) 1,929,087 1,821,331 107,756
(424,363)
(482,005)
57,642
43,069
152,829
(109,760)
813,431
1,040,000
(226,569)
(813,431)
(1,040,000)
226,569
389,068
557,995
(168,927)
(770,362)
(887,171)
116,809
17,389,420
16,831,425
557,995
15,931.507
16,818,678
(887,171)
$ 17,778,488
$ 17,389,420 $
389,068
__j 15,161,145
$ 15,931,507
$ (770,362)
25,444 $ 1,858,314 $ 1,842,839 $ 15,475
8,433 28,762 28,488 274
-24-
The following graph depicts various governmental activities and shows the revenue and expenses directly related to those
activities.
Expenses and Program Revenues - Governmental Activities
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
General government Public safety Public works Culture and Interest on long -term
recreation debt
■ Expenses ■'Program revenues
Revenues by Source - Governmental Activities
Unrestricted investment Charges for services Operating grants and
earnings 12.6% contributions
2.3% . 1.7%
Grants and
contributions not
restricted to specifi
programs
0.1%
Capital grants and
contributions
2.0%
81.3%
For the most part, increases in expenses closely paralleled inflation and growth in the demand for services.
-25-
Business -type activities. Business -type activities decreased the City's net assets by $770,362. The decrease is the result of the
City transferring the remaining proceeds of the liquor store sale to the governmental activities.
Expenses and Program Revenues - Business -type Activities
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
Water
Sewer Recycling Stormwater Liquor
management utility
■ Expenses ■ Program revenues
Revenues by Source - Business -type Activities
Charges for services
942%
perating grants and
contributions
1.5%
eammgs
4.3%
-26-
Financial Analysis of the Government'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.
As of the end of the current fiscal year, the City's governmental funds reported combined ending fund balances of $8,126,233, a
decrease of $1,616,989 in comparison with the prior year. Approxhnately 98 percent of this total amount $7,980,840 constitutes
unreserved fund balance, which is available for spending at the City's discretion. The remainder of fund balance is reserved to
indicate that it is not available for new spending because it has already been committed to pay debt service and for prepaid items
in the amount of $96,333 and $49,060, respectively.
The General fund is the chief operating fund of the City. At the end of the current year, the fund balance of the General fiord was
$3,526,992. As a measure of the General fund's liquidity, it may be useful to compare both unreserved fund balance and total
fund balance to total fund expenditures. Total fund balance represents 84 percent of same year fund expenditures.
The fund balance of the City's General fund decreased $28,732 during the current fiscal year.
The Debt Service fund has a total fund balance of $96,333, all of which is reserved for payment of debt service. The decrease
in fund balance was in line with the City's debt service financing plan.
The Street Reconstruction fund has a fund balance of $1,311,707. The fund balance decreased S301 936 during the current fiscal
year due to capital outlay expenditures in excess of revenues and fransfers in.
The Community Infrastructure fund has a fund balance of $1,867;'783. The fund balance increased $867,783 during the current
fiscal year due to transfers in.
Proprietary funds. 'T'he City's proprietary funds provide the same type 6fmformation found in the government -wide financial
statements, but in more detail. Unrestricted net assets'o flhe,enterprise funds at the end of the year amounted to $8,666,149. The
total decrease in net assets for the 'funds� Was $770,362. Oflikifactors concerning the finances of this fund have already been
addressed in the discussion of the City's business =r e activities,
General Fund Budgetary Highlights
The City's General fund budget was not amended during the year. The budget called for the planned use of General Fund
reserves in the amount of $155,000, in accordance cdtn the City's recently adopted fund balance policy. Prior to the use of
general fund balance reserves, revenues were under budget by $50,520 and expenditures were under budget by $181,535. The
actual amounts were different from the final budget amounts because of the following:
• 'The largest negative variance in revenue was related to interest on investments which were under budget by $48,231
9 The largest positive variance (elated to expenditures was in the finance department which was under budget by $31,419.
• There were six categories of expenditures that were over budget. The largest negative expenditure variance was related
to city clerk/elections which was $33,153 over budget.
-27-
Capital Asset and Debt Administration
Capital Assets. The City's investment in capital assets for its governmental and business type activities as of
December 31, 2010, amounts to $20,175,987 (net of accumulated depreciation). This investment in capital assets includes land,
structures, improvements, machinery and equipment, park facilities, and roads. Major capital asset events during the current
fiscal year included the following:
A new park shelter and accessible play structure were constructed in Manor Park.
• Two lift stations were reconstructed on Enchanted Island.
Additional information on the City's capital assets can be found in Note 3C starts on page 67 of this report.
Capital Assets Net of Depreciation
Total $ 10,765,991 $ 10,765,314 $ 677 " $ 9,409,996 $ 9,647,297 $ (237,301)
Long -term debt. At the end of the current fiscal year, the City had total bonded 'debt outstanding of $13,710,000. Of This
amount, $10,795,000 is lease revenue bonds and $2,915,000 is general obligation revenue bonds. While all of the City's bonds
have dedicated revenue streams pledged to repayment, the general obligation revenue bonds are all backed by the full faith and
credit of the City.
Debt
Governmental Activities Business -type Activities
Increase Increase
2010 2009 ( Decrease) 2010 2009 (Decrease)
General obligation
revenue bonds $ - $ - $ - $ 2,915,000 $ 3,165,000 $ (250,000)
Lease revenue bonds 10,795,000 13,295,000 (2,500,000) - - -
Compensated absences payable ..189,878 193,733 (3,855) - - -
Total $ 10984,878 $ 13,488 733 _L2,503 $ 2,915,000 $ 3,165,000 $ (250,000)
The City's total debt decreased $2,750,000 (17 percent) during the current fiscal year. This is primarily due to the refunding of
$1,900,000 of Lease Revenue bonds.
The City's bond rating was upgraded to "Aa2" from "Aa3" in July, 2008 by Moody's Investors Services with the issuance of the
2008 bonds. At that time, Moody's also upgraded the Shorewood Economic Development Authority (EDA) bond rating to "Aa3"
from "Al ".
Minnesota statutes limit the amount of net general obligation debt a City may issue to 3 percent of the market value of taxable
property within the City. Net debt is debt payable solely from ad valorem taxes. Additional information on the City's long -term
debt can be found in Note 3E starts on page 71 of this report.
INZ
Governmental Activities
'Business -type Activities
Increase
Increase
2010
2009
(Decrease)_
2010
2009
(Decrease)
Land
$ 741,826
$ 741,826
$
$ 404,392
$ :404,392 $
-
Construction inprogress
541,597
399,551
142,046
.280,713
-
280,713
Buildings
2,508,239
2,531,842
(23,603)
-
-
-
Improvements other than buildings
290,714
172,797
117,917
-
-
Machinery and equipment
480,090
367,099
112,991
15,922
24,653
(8,731)
Infrastructure
6,203,525
6 ,552,199
(348,674),
8,708,969
9,218,252
(509,283)
Total $ 10,765,991 $ 10,765,314 $ 677 " $ 9,409,996 $ 9,647,297 $ (237,301)
Long -term debt. At the end of the current fiscal year, the City had total bonded 'debt outstanding of $13,710,000. Of This
amount, $10,795,000 is lease revenue bonds and $2,915,000 is general obligation revenue bonds. While all of the City's bonds
have dedicated revenue streams pledged to repayment, the general obligation revenue bonds are all backed by the full faith and
credit of the City.
Debt
Governmental Activities Business -type Activities
Increase Increase
2010 2009 ( Decrease) 2010 2009 (Decrease)
General obligation
revenue bonds $ - $ - $ - $ 2,915,000 $ 3,165,000 $ (250,000)
Lease revenue bonds 10,795,000 13,295,000 (2,500,000) - - -
Compensated absences payable ..189,878 193,733 (3,855) - - -
Total $ 10984,878 $ 13,488 733 _L2,503 $ 2,915,000 $ 3,165,000 $ (250,000)
The City's total debt decreased $2,750,000 (17 percent) during the current fiscal year. This is primarily due to the refunding of
$1,900,000 of Lease Revenue bonds.
The City's bond rating was upgraded to "Aa2" from "Aa3" in July, 2008 by Moody's Investors Services with the issuance of the
2008 bonds. At that time, Moody's also upgraded the Shorewood Economic Development Authority (EDA) bond rating to "Aa3"
from "Al ".
Minnesota statutes limit the amount of net general obligation debt a City may issue to 3 percent of the market value of taxable
property within the City. Net debt is debt payable solely from ad valorem taxes. Additional information on the City's long -term
debt can be found in Note 3E starts on page 71 of this report.
INZ
Economic Factors and Next Year's Budgets and Rates
• Property valuations within the City decreased, but less than other communities in the Twin Cities metropolitan area.
• Unemployment trends in the region compare favorably to national indices.
• The City takes a responsible long term perspective with financial planning and management. Decisions are made to
ensure ongoing capacity to provide quality services to residents, at a reasonable price.
• The 2011 budget was developed to insulate the City from revenue changes at the State level. Actions by the State should
have minimal impact on City activities.
All of these factors were considered in preparing the City's budget for the 2011 fiscal year.
During the current fiscal year, fund balance in the General fund decreased $28,7,32
$1.55,000 during the 2010 budget cycle. This planned use of general fund baf e
Balance Policy adopted by the City Council. Other possible uses of available fund
transfers to capital project funds as determined by the City Council.
Requests for Information
This financial report is designed to provide a general overview of the City'sfinai
finances. Questions concerning any of the information provided in this report or
should be addr
was less than the planned use of
L accordance with the Fund
e special one -time projects and
those with an interest in the City's
, r additional financial information
esota 55331.
W!2
milli
GOVERNMENT -
FINANCIAL STATI
CITY OF SHi
SHOREWOOD,
FOR THE
31,
31-
-32-
CITY OF SHOREWOOD, MINNESOTA
STATEMENT OF NET ASSETS
DECEMBER 31, 2010
ASSETS
Cash and temporary investments
Cash with fiscal agent
Receivables
Accrued interest
Delinquent taxes
Accounts
Special assessments
Lease
Due from other governments
Prepaid items
Deferred charges
Capital assets
Nondepreciable assets
Depreciable capital assets, net
TOTAL ASSETS
LIABILITIES
Accounts and contracts payable
Accrued salaries payable
Due to other governments
Accrued interest payable
Unearned revenue
Noncurrent liabilities;
Due within one near
Bonds payable
Due in more than
Bonds payable
TOTAL LIABILITIES
NET ASSETS
Invested in capital assets, net of related debt
Unrestricted
TOTAL NET ASSETS
Governmental
Activities
$ 8,125,269
7,375
181,505
178,631
45,975
Exhibit 1
Business -type
Activities Total
$ 8,123,977 $ 16,249,246
113,008 120,383
8,066
400,365
248,262
61,867
184,409
3,780
765
57,136
43,306
625,000 240,000
189,571
178,631
446,340
248,485
9,555,000
3,746
49,060
228,750
1,968,528
18,207,459
189,878
865,000
47,445,199
10,170,000 2,675,000 12,845,000
276,430
58,382
985
226,585
43,306
11,301,170 3,204,396 14,505,566
9,525,991 6,494,996 16,020,987
8,252,497 8,666,149 16,918,646
$ 17,778,488 $ 15 ,1.61,145 $ 32,939,633
The notes to the financial statements are an integral part of this statement,
-33-
CITY OF SHOREWOOD, MINNESOTA
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED DECEMBER 31, 2010
Functions /Programs
Governmental activities
General government
Public safety
Public works
Culture and recreation
Interest on long -term debt
Total governmental activities
Business -type activities
Water
Sewer
Recycling
Stormwater management utility
Liquor
Total business -type activities
Total
Program Revenues
Operating Capital Grants
Charges for Grants and and
Expenses
Services
Contributions
Contributions
$ 1,235,098
$ 53,381
$
$
1,893,413
624,330
2,231,473
-
64,647
130
452,437
58,661
34,467
114,200
474,082
-
-
-
6,286,503
736,372
99,114
114,330
643,886
668,676
980,173
845,043
173,896
146,002
23,560
131,107
198,593
5,202
25
28,762 -
$ 127,876 $ 114,330
axes,levied for general purposes
;omributions not restricted to specific programs
investment earnings
of capital assets
eneralrevenues and transfers
in net assets
Net assets, January 1
Net assets, December 31
The notes to the financial statements are an integral part of this statement.
-34-
Exhibit 2
Net (Expense) Revenue and Changes in Net Assets
Governmental Business -type
Activities Activities
$ (1,181,717)
(1,269,083)
(2,166,696)
(245,109)
(474, 082)
$
(5,336,
(5,336,
4,744,
4,
132,
31,
813,
5,725,
389,
Total
$ (1,181,717)
(1,269,083)
(2,166 ®6)
(245,1.09)
(474.082)
17,389,420 15,931,507 33,320,927
$ 17,778,488 $ 15,161,145 $ 32,939,633
-35-
-36-
VT TRTT
-37-
CITY OF SHOREWOOD, MINNESOTA
BALANCE SHEET
GOVERNMENTALFUNDS
DECEMBER 31, 2010
ASSETS
Cash and temporary investments
Cash with fiscal agent
Receivables
Accrued interest
Delinquent taxes
Accounts
Special assessments
Lease
Due from other governments
Due from other funds
Prepaid items
TOTAL ASSETS
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts and contracts payable
Accrued salaries payable
Due to other governments
Due to other funds
Deferred revenue
TOTAL LIABILITIES
FUND BALANCES
Reserved for
Debt service
Prepaid items
Unreserved
Designated for
Working capital
Capital outlay
Undesignated, reported in
Special revenue funds
TOTAL FUND BALANCES
TOTAL LIABILITIES AND
FUND BALANCES
Debt Street
General Service Reconstruction
$ 3,501,991 $ 88,958 $ 1,328,355
- 7,375 -
1,012
$ 1,329,367
$ 17,660
17,660
- 96,333
49,060 -
3,477,932
1,311,707
3,526,992 96,333 1,311,707
$ 3,791,707 $ 9,651,333 $ 1,329,367
The notes to the financial statements are an integral part of this statement.
-38-
9,146
Exhibit 3
Other Total
Community Governmental Governmental
Infrastructure Funds Funds
$ 1,866,570 $ 1,339,395 $ 8,125,269
- - 7,375
1,867,783 1,341,068 4,520,558
- (17,650) (17,650)
1,867,783 1,323,418 8,126,233
$ 1,867,783 $ 1,344,576 $ 17,984,766
-39-
1,213 5,181 16,552
- - 178,631
-40-
CITY OF SHOREWOOD, MINNESOTA
RECONCILIATION OF THE BALANCE SHEET
TO THE STATEMENT OF NET ASSETS
GOVERNMENTALFUNDS
DECEMBER 31, 2010
Total fund balances - governmental
Amounts reported for the 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 as assets in governmental funds.
Cost of capital assets
Lon€
cu
Lc
Some
an
Govf
du
Total net
Exhibit 4
$ 8,126,233
35,071,863
(24,305,872)
(10,795,000)
166,883
(189,878)
164,953
153,532
223
9,555,000
(169,449)
$ 17,778,488
The notes to the financial statements are an integral part of this statement.
-41-
CITY OF SHORE ^'WOOD, MINNESOTA
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
GOVERNMENTALFUNDS
FOR THE YEAR ENDED DECEMBER 31, 2010
REVENUES
Taxes
Licenses and permits
Intergovernmental
Charges for services
Fines and forfeitures
Special asses
Interest on it
Miscellaneot
TOTAL
EXPENDITUR
Current
General g(
Public saf(
Public vvm
Culture an
Capital outla;
General g(
Public saf(
Public wm
Culture an
Debt service
Principal
Interest an
TOTAL
EXCESS(DEF
OVER(UNI
OTHER FINAL
Transfers in
Sale of capita .. ...........
Bonds refunded
Transfers out
TOTAL OTHER FINANCING SOURCES (USES)
NET CHANGE IN FUND BALANCES
General
Debt
Service
Street
Reconstruction
FUND BALANCES, JANUARY I
FUND BALANCES, DECEMBER 31
The notes to The financial statements are an integral pant of this statement.
-42-
13,981
13,981
1,034,052
1,034,052
(1,020,071)
33,464
168,722
712,135
-
(1,9(t0,000)
-
(1,002,369)
(12,135)
-
(968,905)
(1,743,413)
712,135
(28,732)
(1,835,958)
(307,936)
3,555,724
1,932,291
1,619,643
$ 3,526,992
$ 96,333
S 1,311,707
$ 4,717,204 $ -
154,113 -
69,134 -
42,882 -
55,806 -
Exhibit 5
Other Total
Community Governmental Governmental
Infrastructure Funds Funds
$ - $ - $ 4,717,204
154,113
104,200 1.73,334
58,017 100,899
- 55,806
J 1,1 -,v �1,1�v
(1,900,000)
(114,615) (1,129,119)
854,590 90,154 (1,055,439)
867,783 (312,146) (1,616,989)
1,000,000 1,635,564 9,743,222
$ 1,867,783 $ 1,323,418 $ 8,126,233
-43-
CITY OF SHOREWOOD, MINNESOTA
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
TO THE STATEMENT OF ACTIVITIES
GOVERNMENTALFUNDS
FOR THE YEAR ENDED DECEMBER 31, 2010
Total net change in fund balances - governmental funds
Amounts reported for governmental activities in the statement
of activities are different because:
Capital outlays are reported in governmental funds as expenditures. However, in the statement of
activities, the cost of those assets is allocated over the estimated useful lives as depreciation
expense.
Capital outlays
Depreciation expense
The issuance of long -term debt provides current financial resources to governmental funds, wh
the repayment of principal of long -term debt consumes the current financial resources of gov
funds. Neither transaction, however, has any effect on net assets. Also, governmental funds
the effect of issuance costs, premiums, discounts and similar items when debt is first issued,
whereas these amounts are deferred and amortized in the statement of activities. '
Principal repayments
Bonds refunded
Interest on long -term debt in the statement of
governmental funds because interest is recc
and thus requires the use of current finaneil
interest expense is recognized as the igtere:
Certain revenue
basis of acco
to liquidate Ii
Delinquent
Special ass
Leases
ecogmzec as soon as it
certain revenues cannot
;s of the current period.
as differs from the amount reported in the
as an expenditure in the funds when it is due,
rges. In the statement'of activities, however
;s, regardless of when it is due.
modified accrual
they are available
Some expenses reported in the statement of activities do not require the use of current
financial resources and, therefore, are not reported as expenditures in governmental funds.
Loss on disposal of capital assets
Compensated absences
Change in net assets - governmental activities
Exhibit 6
$ (1,616,989)
1,075,066
(1,065,569)
600,000
1,900,000
42,085
27,144
(78)
(567,626)
(8,820)
3,855
$ 389,068
The notes to the financial statements are an integral part of this statement.
-44-
CITY OF SHOREWOOD, MINNESOTA Exhibit 7
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
GENERAL FUND
FOR THE YEAR ENDED DECEMBER 31, 2010
REVENUES
Taxes
Licenses and permits
Intergovernmental
Charges for services
Fines and forfeitures
Special assessments
Interest on investments
Miscellaneous
TOTAL REVENUES
EXPENDITURES
Current
General government
Public safety
Public works
Culture and recreation
Capital outlay
General government
Public safety
Public works
Debt service
Interest and service charges
TOT
EXCESS OF REVENUES v
OVER EXPENDITURES
OTHER FINANCING SOURCES
Transfers in
Transfers out
TOTAL OTHER FINANCING
SOURCES (USES)
NET CHANGE IN FUND BALANCES
FUND BALANCES, JANUARY I
FUND BALANCES, DECEMBER 31
Budgeted Amounts
Actual
Variance with
Original
Final
Amounts
Final Budget
(1,922)
899440
899,140
859,069
$ 4,743,568
$ 4,743,568
$ 4,717,204
$ (26,364)
106,270
106,270
154,113
47,843
97,724
97,724
69,134
(28,590)
37,000
37,000
42,882
5,882
55,000
55,000
55,806
806
333
333
95,000
95,000,
46,767
(48,233)
42,000
42,000
39,803
(2,197)
5,176,562
.3,176,562
5;126,041,,
(50,520)
1,267,858
1,267,858
1,147,198
120,660
1,391,001
1,391,001
1,392,923
(1,922)
899440
899,140
859,069
40,071
269,381
269,381
263,928
5,453
25,600
25,600
18,557
7,043
509,624
509,624
500,697
8,927
4,800
4,800
538
4,262
2,959 (2,959)
4,367,404 4,185,869 181,535
809,158 809,158 940,173 131,015
43,842 43,842 33,464 (10,378)
(1,008,000) (1,008,000) (1,002,369) 5,631.
(964,158) (964,158) (968,905) (4,747)
(155,000) (155,000) (28,732) 126,268
3,555,724 3,555,724 3,555,724
$ 3,400,724 $ 3,400,724 $ 3,526,992 $ 126,268
The notes to the financial statements are an integral part of this statement.
-45-
ASSETS
CURRENT ASSETS
Cash and temporary investments
Cash with fiscal agent
Receivables
Accrued interest
Accounts
Special assessments
Due from other funds
Prepaid items
TOTAL CURRENT ASSETS
NONCURRENT ASSETS
Special assessments receivable
Deferred charges
Capital assets
Land
Construction in progress
Machinery and equipment
Infrastructure
Less accumulated depreciation
NET CAPITAL ASSETS
TOTAL NONCURRENT ASSETS+
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Accounts and contracts' payable
Accrued salaries payable
Due to other governments
Accrued interest payable
Unearned revenue
Current portion of bonds payable
TOTAL CURRENT LIABILITIES'
NONCURRENT LIABILITIES
Bonds payable less current portion above
TOTAL LIABILITIES
NET ASSETS
Invested in capital assets, net of related debt
Unrestricted
TOTAL NET AS SETS
CITY OF SHOREWOOD, MINNESOTA
STATEMENTS OF NET ASSETS
PROPRIETARY FUNDS
DECEMBER 31, 2010 AND 2009
Business -type Activities - Enterprise Funds
Water Sewer
2010 2009 2010 2009
$ 3,638,748
$ 3A43,647
$ 3,776,321
$ 3,666,489
113,008
11.4,058
-
-
3,265
10,311
3,931
10,992
91,158
95,729
216,980
200,182
5,395
,15,104
5,858
6,015
-
-
-
60,000
1,866,998
7,816 -
-
5,225
3,851,574
3,686,665
4,003,090
3,948,903
24,269
The notes to the financial statements are an integral part of this statement.
-46-
`-
280,713
-
39,869
69,15$
43,385
80
9,944,664
, 9,944,664
8,463,336
8,463336
. (3,433,254)
(3,182,844)
(6,946,044)
(6,764,223)
6,551,279
6,830,978
1,841,390
1,779,159
6,811,937
7,199,983
1,866,998
1,803,428
;10,663,511
10,886,648
5,870,088
5,752,331
17,724
50,224
163,695
9,005
1,625
1,476
1,286
1,529
765
2,446
-
-
57,136
61,077
-
-
43,306
35,262
-
-
240,000
250,000
-
-
360,556
400,485
164,981
10,534
2,675,000
2,915,000
-
-
3,035,556
3,315,485
164,981
10,534
3,636,279
3,665,978
1,841,390
1,779,159
3,991,676
3,905,185
3,863,717
3,962,638
$ 7,627,955
$ 7,571,163
$ 5,705,107
$ 5,741,797
The notes to the financial statements are an integral part of this statement.
-46-
Exhibit 8
Business -type Activities - Enterprise Funds - Continued
Nonmajor Enterprise Totals
2010 2009 2010 2009
$ 708,908 $ 1,522,351 $ 8,123,977 $ 8,632,487
- - 113,008 114,058
870 4,790 8,066 26,093
92,227 61,283 400,365 357,194
067 2366 14470 ?4 4R5
80
I
40
79
(I8
1,01
1,02
1,83
-
-
2,675,000
2,915,000
3,859
17,989
3,204,396
3,344,008
1,017,327
1,037,160
6,494,996
6,482,297
810,756
1,581,387
8,666,149
9,449,210
$ 1,828,083
$ 2,618,547
$ 15,161,145
$ 15,931,507
-47-
CITY OF SHOREWOOD, MINNESOTA
STATEMENTS OF REVENUES, EXPENSES AND
CHANGES IN FUND NET ASSETS
PROPRIETARY FUNDS
FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009
Business -type Activities - Enterprise Funds
Water Sewer
2010 . 2009 2010 2009
OPERATING REVENUES
Charges for services
OPERATING EXPENSES
Personal services
Supplies
Repairs and maintenance
Depreciation
Professional services
Contracted services
Insurance
Water purchases
Utilities
Disposal charges
Other
TOTAL OPERATING EXPENSES
OPERATING INCOME (LOSS)
NONOPERATING REVENUES (EXPENSES)
Special assessments
Permits and connection fees
Interest on investments
Other income
Interest expense
IIi5V191RO
INCOME (LOSS) BEFORE TR
TRANSFERS IN
TRANSFERS OUT
ChLANGE IN NET ASSETS
NET ASSETS, JANUARY 1
NET ASSETS, DECEMBER 31
$ 468,889
$ 577,565
$ 840,413
$ 801,552
84,598
89,791
69,729
67,758
8,945
12,529
2,311
4,406
4,786
° 4,679
40,283
2,526
279,699
274,0'66
218,483
218,481
4,320
2,250 -
6,884
2,523
13,988.
14,329 ,
31,825
31,351
7,816
30,125
5,225
6,427
33,084
32,509
-
67,584
.71,100
9,725
9.382
-
594.273
607.022
13,659
13,683,.
1,435
6,080
518,479 '
525,061
980,173
955,956
(49,590)
52,504
(139,760)
(154,404)
21,744
40,214
-
-
29,134
28,885
4,050
700
32,002
37,460
38,440
50,144
.148;909
137,654
580
-
(125,407)
(134,052)
-
-
,` 106,382
110,161
43,070
50,844
56,792
162,665
(96,690)
(103,560)
-
-
60,000
-
-
-
(1,000,000)
56,792
162,665
(36,690)
(1,103,560)
7,571,163
7,408,498
5,741
6,845,357
$ 7,627,955
$ 7,571163
$ 5,705,107
$ 5,741,797
The notes to the 'financial statements are an integral part of this statement.
-48-
Exhibit 9
Business -type Activities - Enterprise Funds - Continued
Nonmajor Enterprise Totals
2010 2009 2010 2009
$ 344,472 $ 256,024 $ 1,653,774 $ 1,635,141
28,573 60,126 182,900 217,675
4,064 1510 15,320 19,445
$ 1,828,083 $ 2,618,547 $ 15,161,145 $ 15,931,507
-49-
2,618,547 2,564,823 15,931,507 16,818,678
CITY OF SHOREWOOD, MINNESOTA
STATEMENTS OF CASH FLOWS - CONTINUED ON TFIE FOLLOWING PAGES
PROPRIETARY FUNDS
FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers and users
Other receipts and payments, net
Payments to suppliers, contractors and other governments
Payments to employees
NET CASH PROVIDED
BY OPERATING ACTIVITIES
CASH FLOWS FROM
NONCAPITAL FINANCING ACI'IVI'HES
Decrease in due from other funds
Transfers in
Transfers out
NET CASH PROVIDED (USED)
BY NONCAPITAL FINANCING ACTIVITIES
CASH FLOWS FROM CAPITAL
AND RELATED FINANCING ACTIVITIES
Permits and connection fees received
Principal paid on revenue bonds
Interest paid on revenue bonds
Acquisition of capital assets
Special assessments collected
NET CASH 'PROVIDED (USED) BY CAPITAL
AND RELATED FINANCING ACTIVITIES
CASH FLOWS FROM INVESTING ACTIVITIES
Interest received on investments...�t.
NET INCREASE (DECREASE) IN'
CASH AND CASH EQUIVALENTS _
CASH AND CASH EQUIVALENTS, JANUARY I
CASH AND CASH EQUIVALENTS, DECEMBER 31
Business -type Activities - Enterprise Funds
Water Sewer
2010
2009
2010
2009
$ 473,460
$ 595,914
$ 822,433
$ 826,274
156,953
139,305
580
-
(145,359)
(170,671)
(689,281)
(681,975)
(84,449)
(89,859)
(69,972)
(69,507)
400,605
474,689
63,760
74,792
60,000
50,000
S 3,557,705
$ 3,776,321
$ 3,666,489
-
-
-
-
(1,000,000)
-
120,000
(950,000)
29,134
" 28,885
4,050
700
(121,(,
(35,1
(250,000)
(129,521)
(515,046)
126,496
(123,479)
(245,602)
(739,186)
(119,429)
700
39,048
47,605
45,501
64,198
194,051
(216,892)
109,832
(810,310)
3,557,705
3,774,597
3,666,489
4,476,799
$ 3,751,756
S 3,557,705
$ 3,776,321
$ 3,666,489
RECONCILIATION OF CASH AND CASH EQUIVALENTS
TO THE STATEMENT OF NET ASSETS
Cash and temporary investments $ 3,638,748 S 3,443,647 S 3,776,321 S 3,666,489
Cash with fiscal agent 113,008 114,058 - -
TOTAL CASH AND CASH EQUIVALENTS $ 3,751,756 $ 1557,705 $ 3,776,321 $ 3,666,489
The notes to the financial statements are an integral part of this statement.
-50-
Exhibit 10
Business -type Activities - Enterprise funds - Continued
Nonmmnajor Enterprise 'Totals
2010 2009 2010 2009
$ 311,870 $ 262,094 $ 1.607,763 $ 1,684,282
28,885 28,733 186,418 168,038
(271,236) (123,979) (1,105,876) (976,625)
(28,089) (60,612) (182,510) (219,978)
$ 708,908 $ 1,522,351 $ 8,123,977 $ 8,632,487
- - 113,008 114,058
$ 708,908 $ 1,522,351 $ 8,236,985 $ 8,746,545
-51-
$ 708,908 $ 1,522351 $ 8,236,985 $ 8946,545
CITY OF SHOREWOOD, MINNESOTA
STATEMENTS OF CASH FLOWS - CONTINUES)
PROPRIETARY FUNDS
FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009
Business -type Activities - Enterprise Funds
Water Sewer
2010 2009 2010 2009
RECONCILIATION OF OPERATING INCOME (LOSS)
TO NET CASH PROVIDED
BY OPERATING ACTIVITIES
Operating income (loss)
Adjustments to reconcile operating income (loss)
to net cash provided by operating activities
Other income related to operations
Depreciation
(Increase) decrease in assets:
Accounts receivable
Special assessments receivable
Prepaid items
Increase (decrease) in liabilities:
Accounts payable
Due to other governments
Accrued salaries payable
NET CASH PROVIDED
BY OPERATING ACTIVITIES
NONCASH CAPITAL AND
RELATED FINANCING ACTIVITIES
Amortization of deferred charges
Capital ass
$ (49,590) $ 52,504 $ (139,760) $ (154,404)
156,953
139,305
580
-
279,699
274,066
218,483
218,481
4,571
18,349;
(16,798)
28,846
-
-
(1,182)
(4
7,816
'(125)
5,225
(712)
2,688
(U07)
(2,545)
1,229
(1,681)
(135)
-
(12,775)
149
(68),
(243)
(1,749)
400,605 $
474,689.; $
63,760 $
74,792
5 $ +' 8,084 $ $
35,188 $ 157,235 $ -
The notes to the financial statements are an integral part of this statement.
-52-
Exhibit 10
Business -type Activities - Enterprise Funds - Continued
Nonmmajor Enterprise Totals
2010 2009 2010 2009
$ 39,444 $ 49,762 $ (149,906) $ (52,138)
28,885
19,8
(30,9
(1,6
(14,6
4
$ 41,4
28,733 186,418 168,038
-53-
CITY OF SHOREWOOD, MINNESOTA
STATEMENT OF NET ASSETS
FIDUCIARY FUND
DECEMBER 31, 2010
ASSETS
Cash and temporary investments
LIABILITIES
Escrow deposits payable
Exhibit 11
Agency
$ 120,598
$ 120,598
The notes to the financial statements are an integral part of this statement.
-54-
CYfY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting entity
The City of Shorewood, Minnesota (the City), operates under the "Optional Plan A" form of government as defined
in the State of Minnesota statutes. Under this plan, the government of the City is directed by a Council composed of
an elected Mayor and four elected Council members. The Council exercises legislative authority and determines all
matters of policy. The Council appoints personnel responsible for the proper administration of all affairs relating to
the City. The City has considered all potential units for which it is financially accountable, and other organizations
for which the nature and significance of their relationship with the City are such that exclusion would cause the
City's financial statements to be misleading or incomplete. The Governmental Accounting Standards Board (GASB)
has set forth criteria to be considered in determining financial accountability. These criteria include appointing a
voting majority of an organization's governing body, and (1) the ability of the City to impose its will on that
organization or (2) the potential for the organization to provide specific benefits to or impose specific financial
burdens on the City. Blended component units, although legally separate epTities are, in substance, part of the City's
operations and so data from these units are combined with date of the City.'The City has the following component
unit:
Blended component unit
The Economic Development Authority (EDA) of the City was
through 469.108 to carry out economic and industrial develops
established by the Council. It is comprised of the merrbers of 1
EDA activities are blended and reported in the Debt Service ai
are not issued for this component unit.
B. Government -wide and fund financial
The government -wide financial
information on all of the nonfid
normally are supported by taxes
activities, which rely''to'n sign if
the st;
of the
to Minnesota statutes 469.090
it and redevelopment consistent with policies
Council and,' p December 31 year end. The
;apital projects fufids. Separate financial statements
tet assets and the statement of activities) report
component unit. Governmental activities, which
are reported separately from business -type
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
segm ent. grogram revenues include 1) charges to'customers or applicants who purchase, use, or directly benefit
from goodsi services, or privileges prpvided by a given function or segment and 2) grants and contributions that are
restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other
items not properly included among program revenues are reported instead as general revenues
Separate financial statements are provided for governmental funds, proprietary funds and fiduciary funds. Major
individual governmental funds and major individual enterprise funds are reported as separate columns in the fund
financial statements. _..-
-55-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
C. Measurement focus, basis of accounting and financial statement presentation
Governmental fund financial statements are reported using the currentfinancial resources measurement focus and
the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and
available. Revenues are considered to be available when they are collectible within the current period or soon
enough thereafter to pay liabilities of the current period. For this purpose, the City considers revenues to be available
if they are collected within 60 days of the end of the current 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, licenses and interest associated with the current fisca
accrual and so have been recognized as revenues of the current fisca
receivable due within the current fiscal period is considered to be so
period. All other revenue items are considered to be measurable and
City.
Revenue resulting from exchange transactions, in which each
recorded on the accrual basis when the exchange takes place.
year in which the resources are measurable and become avail
are all considered to be susceptible to
Only the portion of special assessments
to accrual as revenue of the current
- when cash is received by the
and receives essentially equal value, is
ed accrual basis, revenue is recorded in the
Non - exchange transactions, in which the City receives yaloe without directly giving equal value in return, include
property taxes, grants, entitlement and donations. On an accrual.basis, revenue from property taxes is recognized in
the year for which the tax is levied. Revenue from grants, entitlements and donations is recognized in the year in
which all eligibility requirements have been satisfied. ,Eligibility regiirements include timing requirements, which
specify the year when the resources are required to be or the year when use is first permitted, matching
requirements, in which the City must provide local resources to be used for a specified purpose, and expenditure
requirements, in which the resources are provided to the City on areimbursement basis. On a modified accrual basis,
revenue from non - exchange transactions must also be available before it can be recognized.
Deferred revenue anises when assets are recognized before revenue recognition criteria have been satisfied. Grants
and entitlements received before eligibility requirements are met are also recorded as deferred revenue. On the
modified accrual basis, receivables that will not be collected within the available period have also been reported as
deferred revenue in the fund financial statements
The preparation of financiall statements in conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results could differ from those estimates.
-56-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
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 Debt Service fund accounts for the resources accumulated and payments made for principal and interest on
long -term general obligation debt of governmental funds.
The Street Reconstruction fund was established for the purpose of funding the periodic reconstruction of City
streets and roadways.
The Community Infrastructure fund was established for
construction on infrastructure capital improvements.
The City reports the following maj or proprietary funds:
The Water fund accounts for the activities of the City's
The Sewer fund accounts for the activities of the City's
Additionally, the City reports the following fund
The Fiduciary funds account for assets held
The Agency fund is custodial in
Agency funds are accounted for
that the City holds for certain re
projects within the City.
followed in both the
not conflict with or contradict gui(
private - sector guidance for their b
governtrie"m has elected not to full
As a general rule the effect of into
Exceptions to this general rule are
function and variousg, funct o
program revenues reported for the
developers,
internal funding for the
system.
as an agent on behalf of others,
operations or have a measurement focus.
This fund is used to account for assets
that are involved with escrow related
and f uumclal reporting issued prior to December 1, 1989, generally are
and propt�et;aty fund financial statements to the extent that those standards do
of the GASB, Govemments also have the option of following subsequent
iss -type activities and enterprise funds, subject to this same limitation. The
pbsequent private- sector guidance.
Activity has been eliminated from government -wide financial statements.
sients -in -lieu of taxes and other charges between the City's water and sewer
'the City. Elimination of these charges would distort the direct costs and
ous functions concerned.
Amounts reported as prograth revenues include 1) charges to customers or applicants for goods, services, or
privileges provided, 2) operating grants and contribution, 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.
-57-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31. 2010
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
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, recycling,
stormwater management utility and liquor enterprise funds are charges to customers for sales and services.
Operating expenses for enterprise funds include the cost of sales and services, administrative expenses, and
depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating
revenues and expenses.
When both restricted and unrestricted resources are available for use, it is the City's policy to use restricted
resources first, then unrestricted resources as they are needed.
D. Assets, liabilities and net assets or equity
Deposits and investments
The City's cash and cash equivalents are considered to be cash on hand, demand deposits, and short-term
investments with original maturities of three months or less from iHe date of acquisition, .
Cash balances from all funds are pooled and invested, to the extent available, in certificates of deposit and other
authorized investments. Earnings from such investments are allocated on the basis of applicable participation by
each of the funds.
The City may invest idle funds as authorized by
1. Direct obligations or obligations guaranteed by theUnited States or its agencies.
2. Shares of investment compauFes registered under the Federal Investment Company Act of 1940 and
received the highest credit rating, rated in one of the two highest rating categories by a statistical rating
agency, and have a final maturity of thirteen months or less.
3. General obligations of a state or local government with taxing powers rated "A" or better; revenue
obligations rated "AA " 'off better.
4. General obligations of the Minnesota Housing Finance Agency rated "A" or better.
5. Bankers' acceptances of United States banks eligible for purchase by the Federal Reserve System
6. Commercial paper issued by United States banks corporations or their Canadian subsidiaries, of highest
quality category by at least two nationally recognized rating agencies, and maturing in 270 days or less.
7. Repurchase or reverse repurchase agreements and securities lending agreements with financial institutions
qualified as a "depository" by the government entity, with banks that are members of the Federal Reserve
System with capitalization exceeding $10,000,000, a primary reporting dealer in U.S. government
securities to the Federal Reserve Bank of New York, or certain Minnesota securities broker - dealers.
8. Guaranteed investment contracts (GIC's) issued or guaranteed by a United States commercial bank, a
domestic branch of a foreign bank, a United States insurance company, or its Canadian subsidiary, whose
similar debt obligations were rated in one of the top two rating categories by a nationally recognized rating
agency.
Investments for the City are reported at fair value. Earnings on investments are allocated to the individual funds
based upon the average cash and investment balances.
-58-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Property taxes
The Council annually adopts a tax levy in December and certifies it to the County for collection in the following
year. The County is responsible for collecting all property taxes for the City. These taxes attach an enforceable lien
on taxable property within the City on January 1 and are payable by the property owners in two installments. The
taxes are collected by the County Auditor and tax settlements are made to the City during January, July and
December each year.
Taxes payable on homestead property, as defined by Minnesota statutes, were partially reduced by a market value
credit aid. The credit is paid to the City by the State of Minnesota (the State) in lieu of taxes levied against the
homestead property. However, in 2010 the City received an aid reduction which decreased their market value credit
aid to zero
Delinquent taxes receivable include the past six years' uncollected taxes. Delinquent taxes have been offset by a
deferred revenue liability for delinquent taxes not received within 60 days`afteryear end in the fund financial
statements.
Accounts receivable
Accounts receivable include amounts billed for services provided beforeyear end. Unbilled utility enterprise fund
receivables are also included for services provided in 2 010: The City annually pertiftddelinquent water and sewer
accounts to the County for collection in the following year: Therefore, there has been no allowance for doubtful
accounts established.
Special assessments
Special assessments represent the financing for public improvements paid for by benefiting property owners. These
assessments are recorded as receivables;pppn certification toShe county. Special assessments are recognized as
revenue when they,a"rereMvpd in cash or within 60 days after year end. All governmental assessments receivable
are offset by a deferred revenue liability in the fund financial statements.
and
Trans actibns funds that are reprgsentative of lending/borrowing arrangements outstanding at the end of the
fiscal year are referred to as either " nnterfund receivables /payables" (i.e., the current portion of interfund loans) or
"advances to /from other funds" (i.e., the non- current portion of interfund loans). All other outstanding balances
between funds are reported as "due tolfom other funds." Any residual balances outstanding between the
governmental activities and business -type activities are reported in the government -wide financial statements as
"internal balances."
Advances between funds; as reported in the fund financial statements, are offset by a fund balance reserve account
in applicable governmental funds to indicate they are not available for appropriation and are not expendable
available financial resources.
Prepaid items
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items
in both government -wide and fund financial statements. Prepaid items of the City are accounted for using the
consumption method.
-59-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Capital assets
Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads, bridges, sidewalks,
and similar items), are reported in the applicable governmental or business -type activities columns in the
government -wide financial statements. Capital assets are defined by the City as assets with an estimated useful life
in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or
constructed. Donated capital assets are recorded at estimated fair market value at the date of donation. For financial
statement purposes only, a capitalization threshold is established for each capital asset category as follows:
Assets
Land and land improvement
Other improvements
Buildings
Building improvements
Machinery and equipment
Vehicles
Infrastructure
Other assets
In the case of initial capitaliz
City chose to include items d
initial reporting of these arse
infrastructure to be capitalize
or estimated acquisition year
assets, they are capitalized at
repairs which are essentially
of the item or extend its usefi
Interest incurred during the c
capitalized value of the asset:
and equipmer
d lives:
Land improvements
Other improvements
Buildings and improvements
System improvements /infrastructure
Machinery and equipment
Vehicles
Compensated absences
Thrnshnid
$ 10,000
25,000
25,000
25,000
5,000
5,000
100,000
5,000
mental activities) the
rrical cost for the
st of the
to acquisition year
rding infrastructure
aintenance and
apacity or efficiency
oiled as part of the
e following
Useful Lives
in Years
15-20
7 -40
20-50
5 -15
5 -15
It is the City's policy to permit employees to accumulate a portion of earned but unused vacation and sick pay
benefits. Accumulated vacation and sick pay are accrued when incurred in the government -wide, proprietary, and
fiduciary 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 the case of an employee leaving, the
General fund would be responsible for liquidation of the liability.
5112
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Postemployment benefits other than pensions
Under Minnesota statute 471.61, subdivision 2b, public employers must allow retirees and their dependents to
continue coverage indefinitely in an employer- sponsored health care plan, under the following conditions: 1)
Retirees must be receiving (or eligible to receive) an annuity from a Minnesota public pension plan, 2) Coverage
must continue in group plan until age 65, and retirees must pay no more than the group premium, and 3) Retirees
may obtain dependent coverage immediately before retirement. All premiums are funded on a pay -as- you -go basis.
It was determined, in accordance with GASB Statement 45, at December 31, 2010 that the City has a zero liability.
Long -term obligations
In the government -wide financial statement and proprietary
debt and other long -term obligations are reported as liabiliti
type activities or proprietary fund type statement of net asse
costs, are deferred and amortized over the life of the bonds
In the fund financial statements, governmental fund types reeo�
issuance costs, during the current period. The face amount of di
Premiums received on debt issuances are reported as other final
reported as other financing uses. Issuance costs, whether or not
reported as debt service expenditures.
Fund equity
In the fund financial statements, g(
available for appropriation or are 1
fund balance represent tentative in
Net assets
Net assets represent the difference
a. Invested in capital assets,
reduced by any outstandit
b. Restricted:net assets - Ca
through external restrictic
c. Unrestrictednetassets,-
capital assets, net of relat
Comparative data/reclassiykation
financial statements, long -term
ernmental activities, business -
discounts, as well as issuance
remiums and discounts, as well as bond
reported as other, arcing sources.
s while discounts on debt issuances are
nn the actual debt proceeds received, are
tfiands reporfreservatioris of fund balance for amounts that are not
icied by outside parties for use for a specific purpose. Designations of
plans that are object to change.
sets , and liabilities. Net assets are displayed in three components:
ed debt - Consists of capital assets, net of accumulated depreciation
ibutable to acquire capital assets.
assets restricted when there are limitations imposed on their use
I by creditors, grantors, laws or regulations of other governments.
I other net assets that do not meet the definition of "restricted" or "invested in
debt".
Comparative total data for the prior year have been presented only for individual enterprise funds in the fund
financial statements in order to provide an understanding of the changes in the financial position and operations of
these funds. Also, certain amounts presented in the prior year data have been reclassified in order to be consistent
with the current year's presentation.
-61-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 2: STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
A. Budgetary information
Annual budgets are adopted on a basis consistent with accounting principles generally accepted in the United States
of America for the General fund. All annual appropriations lapse at fiscal year end. The City does not use
encumbrance accounting.
In August of each year, all departments of the City submit requests for appropriations to the City Administrator so
that a budget may be prepared. Before September 15 the proposed budget is presented to the Council for review.
In early December, the Council holds public hearings and a final budget is prepared and adopted.
The appropriated budget is prepared by fund, function and d
approval of the City Administrator, may make transfers of a
appropriations between departments require the approval of
department level. Budgeted amounts are as originally adopts
B. Deficit fund equity
The following fund had a deficit fund balance as of December
Fund
Nonmajor
Southshore Community Center
The City plans to fund this deficit with
City's department heads, with the
ithin,a department. Transfers of
e legal level of budgetary control is the
Amn,mt
$ 17,650
-62-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 3: DETAILED NOTES ON ALL FUNDS
A. Deposits and investments
Deposits
Custodial credit risk for deposits and investments is the risk that in the event of a bank failure, the City's deposits
and investments may not be returned or the City will not be able to recover collateral securities in the possession of
an outside party. In accordance with Minnesota statutes and as authorized by the Council, the City maintains
deposits at those depository banks, 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 percent of the deposits not covered by insurance or bonds.
Authorized collateral in lieu of a corporate surety bond
• United States government Treasury bills,
• Issues of United States government agencies and
quotation service available to the government ent
• General obligation securities of any state or
better by a national bond rating service, or,r
with taxing powers which is rated "AA'" or
• General obligation securities of
against funds deposited by that-;
as quoted by a recognized industry
gwers which is rated "A" or
any state or local government
service;
may be pledged as collateral
• Irrevocable standby letters,p£eredit issued by 'Federal Home Loan Banks to a municipality accompanied
by written evidence that the b 's public debt is rated "AA" or better by Moody's Investors Service,
hle., or'Standam&Poor's Corporation; and
• Time deposits that are frilly insured by;ariy federal agency.
Minnesota statutes require that all collateral shall be placed in safekeeping in a restricted account at a Federal
Reserve Bank, or in an account at a trust2lepartment of a commercial bank or other financial institution that is not
owned or controlled by the financial institution furnishing the collateral. The selection should be approved by the
government entity,_,:,
At year end, the City's carrying amount of deposits was $571,401 and the bank balance was $696,146. The entire
bank balance was coveted by federal depository insurance and by collateral held by the City's agent in the City's
name.
-63-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 3: DETAILED NOTES ON ALL FUNDS - CONTINUED
A reconciliation of cash and temporary investments as shown on the financial statements for the City follows:
Carrying amount of deposits
Investments
Cash on hand
Total
As reported on the financial statements
Statement of net assets
Cash with fiscal agent
Fiduciary fund
$ 571,401
15,918,514
3t?
$ 16,490,227
$ 16,249,246
120,383
120,598
$ MA ,227
Investments
The Minnesota Municipal Money Market Fund (the 4M Fund) is a custoi
program for Minnesota public funds. Sponsored and governed by the Le<
4M Fund is a unique investment alternative designed to address the daily
Minnesota cities and other municipal entities. Allowable under Minnesot
quality, rated investments.
The Minnesota Municipal Money Market
with appropriate State laws and regulatior
Securities and Exchange Commission (SE
2a7. The reported value of the pool is the
Fund can be obtained by conttactin2'Vov
nagement and investment
sofa Cities since 1987, the
investment needs of
4M Fund is comprised of top
narket investment pools operate in accordance
emal investment pool not registered with the
to same regulatory rules of the SEC under rule
Ire pool share. Financial statements of the 4M
at 100 South Fifth Street, Suite 2300,
-64-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 3: DETAILED NOTES ON ALL FUNDS - CONTINUED
At year end, the City had the following investments that are insured or registered, or securities held by the City's
agent in the City's name:
1. Ratings are provided by various credit ratings agencies where applicable to indicate associated credit risk
2. Interest rate risk is disclosed using the segmented time distribution method.
N/A Indicates not applicable or avanable. t'
The investments of the CiN,aresubiectto the _foltowina risks:
Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its
Ratings are provided by various credit rating agencies and where applicable, indicate associated
Minnesota Statutes and the City's policy limit the City's investments to the list on page
Custodial Credit Risk. The custodial credit risk for investments is the risk that, in the event of the failure of the
counterparty to a transaction, a government will not be able to recover the value of investment or collateral
securities that are in the possession of an outside party. In accordance with the City's investment policy, the
investment officer*all strcoture all investments, deposits and repurchase agreements so that the custodial risk
is categorized as either insured or registered, or securities held by the City or its agent in the City's name or
uninsured and unregistred, with securities held by the counterparty's trust department or agent in the City's
name. All investments are placed in safekeeping at financial institutions.
o Concentration of Credit Risk Concentration of credit risk is the risk of loss attributed to the magnitude of a
government's investment in a single issuer. In accordance with the City's investment policy, the City diversifies
its investment portfolio to eliminate the risk of loss resulting from over- concentration of assets in a specific
maturity, a specific issuer or a specific class of securities. The maturities selected shall provide for stability of
income and reasonable liquidity.
• Interest rate risk Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of
an investment. In accordance with its investment policy and also detailed in the description of concentration of
credit risk, the City manages its exposure to declines in fair values by "laddering" their investment maturities to
ensure that a portion of the portfolio is maturing monthly, or as needed to meet projected expenditures. The
City also permits no more than 30% of total investments to extend beyond five (5) years and does not directly
invest in securities maturing more than 15 years from the date of purchase.
-65-
Fair Value
Credit
Segmented
and
Quality/
Time
Carrying
Types of Investments
Rating (1)
Distribution (2)
Amount
Non Pooled investments
U.S. Government Agency Securities
AAA
more than 3 years
$ 2,592,157
Municipal Bonds
Aa2
1 to 3 years
753,752
Municipal Bonds
Aa2
more than 3 years
196,113
Brokered Certificates of Deposit
N /A'
' Iess'than 6 months
1,782,955
Brokered Certificates of Deposit
Q/A
`�6 to 12 months
452,481
Brokered Certificates of Deposit
N/A
' T`10 3 years
1,667,264
Total non pooled
7,444,722
Pooled investments
Minnesota Municipal Money Market Fund
P -1
less than 6 mouths
1,805,905
Broker Money Market
N/A
` : less than 6 months
6,667,887
Total pooled
8,473,792
Total investments
$ 15,918,514
1. Ratings are provided by various credit ratings agencies where applicable to indicate associated credit risk
2. Interest rate risk is disclosed using the segmented time distribution method.
N/A Indicates not applicable or avanable. t'
The investments of the CiN,aresubiectto the _foltowina risks:
Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its
Ratings are provided by various credit rating agencies and where applicable, indicate associated
Minnesota Statutes and the City's policy limit the City's investments to the list on page
Custodial Credit Risk. The custodial credit risk for investments is the risk that, in the event of the failure of the
counterparty to a transaction, a government will not be able to recover the value of investment or collateral
securities that are in the possession of an outside party. In accordance with the City's investment policy, the
investment officer*all strcoture all investments, deposits and repurchase agreements so that the custodial risk
is categorized as either insured or registered, or securities held by the City or its agent in the City's name or
uninsured and unregistred, with securities held by the counterparty's trust department or agent in the City's
name. All investments are placed in safekeeping at financial institutions.
o Concentration of Credit Risk Concentration of credit risk is the risk of loss attributed to the magnitude of a
government's investment in a single issuer. In accordance with the City's investment policy, the City diversifies
its investment portfolio to eliminate the risk of loss resulting from over- concentration of assets in a specific
maturity, a specific issuer or a specific class of securities. The maturities selected shall provide for stability of
income and reasonable liquidity.
• Interest rate risk Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of
an investment. In accordance with its investment policy and also detailed in the description of concentration of
credit risk, the City manages its exposure to declines in fair values by "laddering" their investment maturities to
ensure that a portion of the portfolio is maturing monthly, or as needed to meet projected expenditures. The
City also permits no more than 30% of total investments to extend beyond five (5) years and does not directly
invest in securities maturing more than 15 years from the date of purchase.
-65-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 3: DETAILED NOTES ON ALL FUNDS - CONTINUED
B. Deferred revenue
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 and business -type funds 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 and unearned revenue reported in the governmental funds and
business -type funds were as follows:
Governmental activities
General fund
Taxes
Special assessments
Debt Service
Lease receivable
Total
Business -type activities
Unavailable Unearned
153,532 $
223
$ 43,306
-66-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 3: DETAILED NOTES ON ALL FUNDS - CONTINUED
C. Capital assets
Capital asset activity for the year ended December 31, 2010 was as follows:
Less accumulated depreciation
Buildings
Beginning
(84,212)
Ending
Improvements other than buildings
Balance
Increases
Decreases
Balance
Governmental activities
(19,964,156)
(826,880)
-
(20,791,036)
Capital assets not being depreciated
(2,127,464)
(125,695)
207,018
(2,046,141)
Land
$ 741,826
$ -
$ -
$ 741,826
Construction in progress
399,551
620,251
(478,205)
541,597
Total capital assets
not being depreciated
1,141,377
620,251.
(478,205)
1,283,423
Capital assets being depreciated
Buildings
3,313,261
60,609
$ (487,0251
3,373,870
Improvements other than buildings
747,079
146,699
893,778
Infrastructure
26,516,355
478,206
26,994,561
Machinery and equipment
2,494,563
247,506
(215,838)
2,526,231
Total capital assets
being depreciated
33,071,258
933,020
"` (215,838)
33,788,440
Less accumulated depreciation
Buildings
(781,419)
(84,212)
(865,631)
Improvements other than buildings
(574,282)
(28,782)
(603,064)
Infrastructure
(19,964,156)
(826,880)
-
(20,791,036)
Machinery and equipment i
(2,127,464)
(125,695)
207,018
(2,046,141)
Total accumulated
depreciation
(23,447,321)
(1,065,569)
207,018
(24,305,872)
Total capital assets
being depreciated, net
9,623,937
(132,549)
(8,820)
9,482,568
Governmental activities
capital assets, net
$ 10,765,314
$ 487,702
$ (487,0251
$ 10765,991
-67-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 3: DETAILED NOTES ON ALL FUNDS - CONTINUED
Beginning Ending
Balance Increases Decreases Balance
Business -type activities
Capital assets not being depreciated
Land
Construction in progress
Total capital assets
not being depreciated
Capital assets being depreciated
Infrastructure
Machinery and equipment
Total capital assets
being depreciated
Less accumulated depreciation for
Infrastructure
Machinery and equipment
Total accumulated
depreciation
Total capital assets
being depreciated, net
net
expense was
1 7 $ (237,302) $ 1 $ 9,409,996
of the City as follows:
General government
$
73,169
Public works
937,008
Culture and recreation.
55,392
Total depreciation expense - governmental activities
$
1,065,569
Business -type activities'
Water
$
279,699
Sewer
218,483
Stormwater management utility
19,833
Total depreciation expense - business -type activities
$
518,015
$ 404,392 $ - $
- 280,713 _
404,392 280,713
19,201,312
19,350,516
$ 404,392
280,713
685,105
19,201,312
83,254
19,284,566
- (10,492,343)
65,951 (67,332)
65,951 (10,559,675)
18,015 1 8,724,891
-68-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 3: DETAILED NOTES ON ALL FUNDS - CONTINUED
Construction commitments
The City has active construction projects as of December 31, 2010. At year end, the commitment with the
contractors for these projects is as follows:
Spent Remaining
Project to date Commitment
Meadowview & Nelsine Improvements $ 350,752 $ 45,813
Lift Station 17 Rehabilitation 104,668 11,653
Lift Station 15 Rehabilitation 106,870 11,219
Total $ 562,290 $ 68,685
D. Interfund receivables, payables and transfers
The composition of interfund balances as of December 31, 2010, is as follows:
Receivable Fund Payable Fund Purpose Amount
General Nonmajor governmental Cash flow" $ 2,935
-69-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 3: DETAILED NOTES ON ALL FUNDS - CONTINUED
Interfund transfers
Transfers in
Street
Community
Fund General Debt Service Reconstruction
Infrastructure
Transfers out
General $ $ 100,369 $ 700,000
$
Debt service - 12,135
Other governmental 14,623 68,353 -
-
Nonmajorenterprise 18,841 - -
854,590
Total $ 33,464 $ 168,722 $ 712,135
$ 854,590
Transfers in
Other
Fund Governmental Sewer
Total
Transfers out
General $ 142,000 $ 60,000
$ 1,002,369
Debt service -
12,135
Other governmental 31,639
114,615
Nonmajor enterprise -
873,431
Total $ 173,639 $ 60,000
$ 2,002,550
The City annually budgets transfers for specific purposes. 'Annual transfers are made as part of capital
improvement
plans as well as annual budgets.
For the year ended December 31 2010, the City made the following one -time transfers:
e The Liquor fund was closed to the General and Community Infrastructure funds.
The Waterford. III TIF District fund was closed to the Street Reconstruction fund.
a The
City Hall Project fund was closed by transferring money from the Public Facilities fund.
o The
EDA Public Safety Facilities Project was closed to the 2007A, 200713, and 2007C FDA Public Safety
BuildineDebt Service funds....`
-70-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL, STATEMENTS
DECEMBER 31, 2010
Note 3: DETAILED NOTES ON ALL FUNDS - CONTINUED
E. Long -term debt
General Obligation Bonds. The City issues general obligation bonds to provide funds for the acquisition and
construction of major capital facilities. General obligation bonds have been issued for both governmental and
business -type activities. These bonds are reported in the proprietary funds if they are expected to be repaid from
proprietary fund revenues. In addition, general obligation bonds have been issued to refund special assessments
related bonds.
General obligation bonds are direct obligations and pledge the full faith and credit of the City. The City has the
following general obligation debt:
General obligation revenue bonds
The following bonds were issued to finance capital improvements in the enterprise funds. They will be retired from
net revenues of the enterprise funds.
Balance
Authorized Interest , Issue Maturity at
Description and Issued Rate Date Date Year End
G.O. Water Revenue
Bonds of 2005 $
1,525,000
3:00 - 4.25`%
06101105.
01/01/25
$ 1,225,000
G.O. Water Revenue
Principal Interest
Total
2011
$ 240,000 $ 111,538 $
351,538
Bonds of 1996
860,Q00
4,95 - 5,40
Jy01/96
02/01/12
115,000
G.O. Water Refunding
190,000 88,940
278,940
2015
195,000 81,555
276,555
Bonds of 2003
815x000
1.50 -3.00
08/01/03
02/01/11
125,000
G.O. Water Revenue
Bondsof2006
1,450,000
4.00
11/29/06
01/01/22
1,450,000
Total G.O. Revenue Bonds
$ 1915,000
service requirements to maturity for general obligation revenue bonds are as follows:
Total
$ 2,915,000 $ 831.809 $ 3,746,809
-71-
G.O. Revenue Bonds
Year Ending
Business -type Activities
December 31,
Principal Interest
Total
2011
$ 240,000 $ 111,538 $
351,538
2012
175,000 103,398
278,398
2013
185,000 96,103
281,103
2014
190,000 88,940
278,940
2015
195,000 81,555
276,555
2016 -2020
1,110,000 283,091
1,393,091
2021 -2025
820,000 67,184
887,184
Total
$ 2,915,000 $ 831.809 $ 3,746,809
-71-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 3: DETAILED NOTES ON ALL FUNDS - CONTINUED
Lease revenue bonds
The City also issues bonds where the City pledges income derived from the acquired or constructed assets to pay
debt service. Revenue bonds outstanding at year end are as follows:
Balance
Authorized Interest Issue Maturity
at -
Description and Issued Rate Date Date
Year End
Public Safety Fire Facility,
Refunding Series 2007A 4,130,000 3.75 -5.00 01(01/07 02/01/23 $
3,960,000
Public Safety Police Facility,
Refunding Series 2007B 4,285,000 3.75-5,00 01/01/07 , 02/01/23
4,105,000
Public Safety Fire Facility,
Refunding Series 2007C 1,585,000 3.75 -5.00 01/01/07 02/01/22
1,490,000
Public Project Lease Revenue
Bonds, Series 2008A 1,310,000 2.85 -4.80 08/19/08 12/01/28
1,240,000 —
Total Lease Revenue Bonds $ 10,795,000
The Public Safety Fire Facility Refunding Series 2007A, 2007B and 2007C were issued for construction of the
public safety building, which there is a lease receivable from the South Lake Minnetonka Police and Excelsior Fire
District. This debt is excluded from the calculation of net assets invested
in capital assets, net of related debt as the
building is reported on the South Lake Minnetonka Police and Excelsior
Fire District as a capital asset.
Refer to
Note 5 A and B for further information.
Annual debt service requirements to maturity for revenue bonds are as follows:
Lease Revenue Bonds
Year Ending Governmental Activities
December 31, Principal Interest
Total
' �OI1 $ 625,000 $ 439,056 $
1,064,056
2012 655,000 413,944
1,068,944
2013 675,000 385,963
1,060,963
2014 705,000 356,227
1,061,227
2015 735,000 325,081
1,060,081
2016 -2020 4,175,000 1,120,895
5,295,895
2021-2025 2,945,000 276,800
3,221,800
2026-2028 280,000 27,030
307,030
Total $ 10 .795,000 $ 3,344,996 $
14.139,996
72-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 3: DETAILED NOTES ON ALL FUNDS - CONTINUED
Changes in long -term liabilities
Long -term liability activity for the year ended December 31, 2010, was as follows:
Governmental activities
Lease revenue bonds
Compensated absences
Total
Business -type activities
General obligation
revenue bonds
Crossover refunding
Beginning Ending Due Within
Balance Increases Decreases Balance One Year
$ 13,295,000 $ - $(2,500,000) $ 10,795,000 $ 625,000
193,733 203,791 (207,646) 189,878 189,878
$ 13,488333
$ 3,165,000
On January 1, 2007 the Economic Development Authority (
Fire Facility Lease Revenue Crossover Refunding Bond s,,2
and 2003A Public Safety Fire Facility Lease RevenueBond
escrow account and will be used to pay issuance costs and t
obligations will bear interest rates that will provide $,ufficieil
were refunded on February 1, 2009 and the003Aseries b4
account will also provide debt service payitients on the new
considered defeased until the crossovarda #es, and therefor?@
crossover refunding issue, the EDA will avp $288,277 in d
present value of the lifferenee Between the oldand the new
On
1, 2007 the Economic Development Authority (the EDA) of the City issued $4,285,000 of Public Safety
ity Lease Revenue Crossby6f Refunding Bonds, 2007B. The bonds issued will crossover refund the
?003B
Public Safety Police;-facility Lease Revenue Bonds. The proceeds of the bonds were deposited in
an escrow account and will be used tc pay issuance costs and to purchase government obligations. The government
obligations will bear interest rates thatIWill provide sufficient funds to refund the old bonds. The 2002B series bonds
were refunded on Fetaiiary 1, 2009 and the 2003B series bonds were refunded on February 1, 2010. The escrow
account will also provide debt service payments on the new bond until the crossover dates. The old bonds are not
considered defeased until be,cr6ssover dates, and therefore will not be removed as liabilities. As a result of the
crossover refunding issue, the EDA will save $304,293 in debt service payments and achieve an economic gain (the
present value of the diffeu` nce between the old and the new debt service) of $204,501.
$ 814,878
$ 240,000
the EDA) of tht, ty issued $4,130,000 of Public Safety
107A. The bondsissnedwilll crossover refund the 2002A
s,17he proceeds of bonds were deposited in an
? p,," , se government obligations. The government
it funds to refund the old bonds. The 2002A series bonds
nds weierefupded on February 1, 2010. The escrow
be until the crossover dates. The old bonds are not
will not be removed as liabilities. As a result of the
"litservice payments and achieve an economic gain (the
debt�service) of $195,442.
73-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 4: DEFINED BENEFIT PENSION PLAN - 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), which is a cost - sharing, multiple- employer retirement plan. This plan is established and
administered in accordance with Minnesota statutes, 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. All new members must participate in the Coordinated Plan.
PERA provides retirement benefits as well as disability benefits to
eligible members. Benefits are established by Minnesota statute; a
defined retirement benefits are based on a member's highest averm,
allowable service, age and years of credit at termination of service
Two methods are used to compute benefits for PERA's Coordinat
receives the higher of a step -rate benefit accrual formula (Method
Method 1, the annuity accrual rate for a Basic Plan member is 2.2 O
years of service and 2.70 percent for each remaining year. The an
is 1.20 percent of average salary for each of the first 10 years and
Method 2, the annuity accrual rate is 2.70 percent of average sal
Coordinated Plan members for each year of service. For all GERF
annuity is calculated using Method 1, a full annuity is available w
retirement age is 65 for Basic and Coordinated members hired pri,
age for unreduced Social Security benefits capped at 6`6 for Coord
reduced retirement annuity is also available uo eligible members se
and benefits to survivors upon death of
er three years of credited service. The
)zany five successive years of
etl and Basic Plan members. The refiring member
j),or a level accrual formula (Method 2). Under
'pereent of average salary for each of the first 10
noisy accrual rate for a Coordinated Plan member
1.70 percent each remaining year. Under
ary for Basic Plan members and 1.70 percent for
members h 'red prior to July 1, 1989 whose
hen age plus years of service equal 90. Normal
orto July 1,1989. Normal retirement age is the
mated members hired on or after July 1, 1989. A
eking early retirement.
There are different types of annuities'nvailable to members upon retirement. A single -life annuity is a lifetime
annuity that ceases upon the death of the retiree -- no survivor annuity is payable. There are also various types of
joint and survivor annuity options available which will be payable over joint lives. Members may also leave their
contributions in the fund upon termination of public service in order to qualify for a deferred annuity at retirement
age. Refunds of contributions are available at any time members who leave public service, but before retirement
The benefit provisions stated in the previous paragraphs of this section are current provisions and apply to active
plan participants. Vested, terminated employees who are entitled to benefits but are not receiving them yet are
bound by the provisions in effect at the time they last terminated their public service.
PERA issues a publicly available financial report that includes financial statements and required supplementary
information for GERF. That report may be obtained on the Internet at mnpera.org, by writing to PERA, 60 Empire
Drive #200, St. Paul, Minnesota, 55103-2088 or by calling (651) 296 -7460 or 1- 800 - 652 -9026.
B. Funding policy
Minnesota statutes, chapter 353 sets the rates for employer and employee contributions. These statutes are
established and amended by the State legislature. The City makes annual contributions to the pension plans equal to
the amount required by Minnesota statutes. GERF Basic Plan members and Coordinated Plan members were
required to contribute 9.1 percent and 6.0 percent, respectively, of their annual covered salary in 2010. The City is
required to contribute the following percentages of annual covered payroll: 11.78 percent for Basic Plan GERF
members and 7.00 percent for Coordinated Plan GERF members. Employer contribution rates for the Coordinated
Plan will increase to 7.25 percent, effective January 1, 2011. The City's contributions to the GERF for the years
ending December 31, 2010, 2009 and 2008 were $89,850, $89,503 and $92,053, respectively. The City's
contributions were equal to the contractually required contributions for each year as set by Minnesota statute.
74-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 5: JOINT VENTURES
A. South Lake Minnetonka Police Department
The City participates in a joint powers agreement with the cities of Excelsior, Greenwood and Tonka Bay, which
establishes the South Lake Minnetonka Police Department (Department) for the purpose of providing police
protection within the four communities. The agreement creates a coordinating committee, comprised of the Mayors
of each participating community, as the governing body, which meets quarterly. Each year, the coordinating
committee adopts an operating budget, which is approved by all participating cities. The cost of the operating budget
is divided between the participating cities based upon a fixed percentage of the total municipal revenue allocated to
each city.
Any budget shortfall is made up first from department reserves,
participating community according to the formula. The most re(
December 31, 2010.
Separate financial statements can be obtained by writing to
Smithtown Road, Shorewood, Minnesota 55331.The follov
Assets as of December 31, 2010 and 2009:
SOUTH LAKE MINNETONKA POLICI
SUMMARY OF STATEMENTS OF
DECEMBER 31, 2010 AND
shortfall assessed to each
ed information is
Police Department, 24150
artment's Statement of Net
2010 2009
Assets
Liabilities
Net assets
Total liabilities
and net assets
the following is a summary
$ 5,492,102 $ 5,608.495
$ 4,410,500 $ 4,645,360
1,081,602 963,135
$ 5,492,102 $ 5,608,495
of activities for the years ended December 31, 2010
SOUTH LAKE MINNETONKA POLICE DEPARTMENT
SUMMARY STATEMENTS OF ACTIVITES
YEARS ENDED DECEMBER 31, 2010 AND 2009
-75-
2010
2009
Expenses
$ 2,439,416
$ 2,421,205
Revenues
2,547,262
2,505,559
Net expenses
107,846
84,354
General revenues
10,621
12,221
Change in net assets
118,467
96,575
Net assets, January 1
963,135
866,560
Net assets, December 31
$ 1,081.602
$ 963,135
-75-
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2010
Note 5: JOINT VENTURES - CONTINUED
B. Excelsior Fire District
In August of 2000, the cities of Deephaven, Excelsior, Greenwood, Shorewood and Tonka Bay entered a joint
powers agreement to provide fire protection and medical response service to their residents and created an entity
called the Excelsior Fire District (the District). The Board of Directors is comprised of ten members and five
alternate members. Each member city appoints two representatives on the Board of Directors and one alternate. The
City is billed for service based on a formula that determines its share of the total expenditures.
Separate financial statements can be obtained by writing to the Excelsior Fire District, 24100 Smithtown Road,
Shorewood, Minnesota 55331. The following is a summary of the District's Statement of Net Assets as of
December 31, 2010 and 2009:
EXCELSIOR FIRE:DISTP
SUMMARY OF STATEMENTS OF
DECEMBER 31, 2010 ANE
Assets
Net assets, January 1
Net assets, December 31
0;
2009
9655
$ 8,422,859
1,278
$ 6,312,024
8,377
2,110,835
$ 8,119,655 $ 8,422,859
years ended December 31, 2010 and
PARTMFNT
VITES
AND 2009
2010 2009
$ 1,499,627 S 1,503,047
1,354,038 1,281,120
145,589 221,927
11,953 49,387
157,542 271,314
2,110,835 1,839,521
$ 2268,377 $ 2,110,835
-76-
Change in net assets
CITY OF SHOREWOOD, MINNESOTA
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31. 20 10
Note 6: OTHER INFORMATION
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 for which the City carries insurance. The City obtains
insurance through participation in the League of Minnesota Cities Insurance Trust ( LMCIT) which is a risk sharing
pool with approximately 800 other governmental units. The City pays an annual premium to LMCIT for its workers
compensation and property and casualty insurance. The LMCIT is self sustaining through member premiums and
will reinsure for claims above a prescribed dollar amount for each insurance event. Settled claims have not exceeded
the City's coverage in any of the past three fiscal years.
Liabilities are reported when it is probable that a loss has c
estimated. Liabilities, if any, include an amount for claims
City's management is not aware of any incurred but not re_
B. Legal debt margin
The City's statutory debt limit is $49,143,552 computed as th
within the City. Long -term debt issued and financed partially
the net revenues of enterprise fund operations is excluded fro:
is subject to the statutory debt limit.
C. Southshore Community Center
Ge amount of the loss can be reasonably
i ineurredbut not reported (IBNRs). The
of the taxable u>aeket value of property
b y special assessments, tax increments or
unit computation: The City has no debt that
On July 1, 2009, the City entered into an agreement to take over operations of the Southshore Community Center.
The City also contracted with CommunityRecreat inn Resources (CRR) ,for the operation, management, and
programming of the Southshore Community Center. The contract with CRR is for the period of July 1, 2009 to July
1, 2012. The agreement is for a three year period with an op)ipp to renew and/or renegotiate. The City paid CRR
$10,000 for the period of January 1, 241U to December 31; 20iA.ming this time, the City shall pay a 15 percent
commission on quarterly revenues to CRR. Beginning on January 1, 2011, the fee will increase to $15,000 per year
with a 20 percent commission rate on revenues'An addition, the City will fund a part-time contractor brought in by
CRR to assist and staff the center nt a cost of $6;000 peryear, with a built -in increase at eighteen months not to
exceed $6,750 annually for the following 18 months, .
-77-
-78-
COMBINING AND INDI
FINANCIAL STATEMENTS
CITY OF SHt
SHOREWOOD,
FOR THE
dm
M
NONMAJOR GOVERNMENTAL FUNDS
NONMAJOR SPECIAL REVENUE FUNDS
Special revenue funds are used to account for revenue derived from
usually required by Minnesota statute or local ordinances to finance
Southshore Community Center -'This fund was established to account
held at the City's community center, and the payment of expenditures re
of
rked revenue sources. They are
activities of government.
events and activities
-81-
CITY OF SHOREWOOD, MINNESOTA
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
DECEMBER 31, 2010
ASSETS
Cash and temporary investments
Receivables
Ac
LIABII
LIABII
Accc
Due
Accr
FUND
Unre
De
Ur
Exhibit A -1
Total
Capital Nonmajor
Projects Funds
$ 1,339,395 $ 1,339,395
5,181
$ 1,344,576
Special
Revenue
Southshore
Community
Center
$ 18,030
2,935
193
21,158
1,341,068
(17,650)
1,323,418
$ 1,344,576
-82-
CITY OF SHOREWOOD, MINNESOTA
NONMAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES (DEFICITS)
FOR THE YEAR ENDED DECEMBER 31, 2010
REVENUES
Intergovernmental
Charges for services
Interest on investments
Miscellaneous
Park dedication fees
Contributions and donations
Other
TOTAL REVENUES
EXPENDITURES
Current
Culture and recreation
Capital outlay
General government
Public safety
Public works
Culture and recreation
TOTAL
EXCESS(DEFICIEN(
OVER (UNDER) E)
OTHER FINANCING
Transfers in
Sale of capital assets
Transfers out
REVENUES
TOTAL OTHER FINANCING SOURCES (USES)
NET CHANGE IN FUND BALANCES
HIND BALANCES (DEFICITS), JANUARY 1
FUND BALANCES (DEFICITS), DECEMBER 31
Special
Community Capital
Center Projects
$ - $ 104,200
58,017 -
?._ _ 19,691
Exhibit A -2
Total
Nonmajor
$ 104,200
58,017
19,779
10,000 10,000
- 321
5,361
33,891 197,678
78,726
-83-
8,949
8,949
2
2
250,321
250,321
-
261,980
261,980
78,726
521,252
599,978
(14,939)
(387,361)
(402
-
173,639
173,639
-
31,130
31,130
-
(114,615)
(114,615)
-
90,154
90,154
(14,939)
(297,207)
(312,146)
(2,711)
1,638,275
1,635,564
$ (17,650)
$ 1,341,068
$ 1,323,418
-83-
-84-
NONMAJOR CAPITAL PROJECTS FUNDS
Capital projects funds are used to account for the acquisition and construction of major capital facilities other than those financed
by enterprise funds.
Public Facilities - This fund was established to account for capital impro
Park Capital Improvement - This fund accounts for park land acquisiti(
Equipment Replacement - This fund was established for the purpose of
MSA Construction - This fund was established to account for the accum
periodic reconstruction of MSA designated roads.
Teehnoloev - This fund was established for the replacement of office eql
operations at the city offices,
City Hall Construction - This fund was established for #i urpose ofni
EDA Public Safety Facilities Project - This
public safety facility.
for
public facilities.
in the City parks,
State Aid (MSA) to fund the
for municipal
and remodeling of City Hall.
of accounting for construction of the new
-85-
CITY OF SHOREWOOD, MINNESOTA
NONMAJOR CAPITAL PROJECTS FUNDS
COMBINING BALANCE SHEET
DECEMBER 31, 2010
ASSETS
Cash and temporary investments
Receivables
Accrued interest
TOTAL ASSETS
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts and contracts payable
FUND BALANCES
Unreserved
Designated for capital outlay
TOTAL LIABILITIES AND
FUND BALANCES
934 $ 2,537 $
105 131,749
$ 734,642 $ 131,749
-86-
Park
Public
Capital
Equipment
MSA
Facilities
Improvement
Replacement
Construction
$ 195,71.0
$ 190,771
$ 733,403
$ 128,868
370
543
1,239
2,881
$ 196,080
$ +J91,314:
$'" 734
$ 131,749
934 $ 2,537 $
105 131,749
$ 734,642 $ 131,749
-86-
Exhibit B -1
EDA
Public
Safety
City Ball Facilities
Technology Construction Project Total
$ 90,643 $ - $ $ 1,339,395
5,144
$ 90,754 $ $
$ $ $ $ 3,471
90,
$ go"
-87-
CITY OF SHOREWOOD, MINNESOTA
NONMAJOR CAPITAL PROJECTS FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES (DEFICITS)
FOR THE YEAR ENDED DECEMBER 31, 2010
REVENUES
Intergovernmental
Interest on investments
Miscellaneous
Park dedication fees
Other
TOTAL REVENUES
EXPENDITURES
Capital outlay
General government
Public safety
Public works
Culture and recreation
TOTAL EXPENDITURES
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
OTHER FINANCING SOURCES (USES)
Transfers in
Sale of capital assets':
Transfers ouL'
TOTAL OTHER FINANCING SOURCES
NET CHANGE IN FUND BALANCES
FUND BALANCES (DEFICITS), JANUARY I
FUND BALANCES, DECEMBER 31
Park
Public Capital Equipment MSA
Facilities Improvement Replacement Construction
$ - $ 104,200 S - $
2,333 2,730 8,495 4,093
2,333
250,306
250,306
4,093
15
15
(145,050) (241,811) 4,078
42,000 100,000 -
- 31,130
(31,639) - - -
(31,639) 42,000 131,130 -
(31,682) (103,050) (110,681) 4,078
227,762 293,430 842,786 127,671
$ 196,080 $ I90,380 $ 732,105 $ 131,749
_88-
Exhibit B -2
'Technology
854
EDA
Public
Safety
City Hall Facilities
Construction Project
1,186
854 1.,1.86 -
3 6,570
2
3 6,570
851
Total
$ 104,200
19,691
10,000
8,949
-
31,639
173,639
31,130
(14,622)
(68,354)
(114,615)
(14,622)
31,639
(68,394)
90,154
(13,771)
26,255 . -.
(68,356)
(297,207)
104,525
(26,255) -
68,356
1,638,275
90,754 $
$
$ 1,341,068
-89-
.,
NONMAJOR PROPRIETARY FUNDS
NONMAJOR ENTERPRISE FUNDS
Enterprise funds are used to account for fund activities of the City that operate in a manner similar to private businesses.
Recycling - This fund accounts for the activities of the City's recycling
Stormwater Management Utility - This fund accounts for the activities
system.
Lig uo -This fund is used to account for the activities of the City's off-sale liquor operation. The operation consisted of two off -
sale liquor store sites. The City discontinued operations of the liquor store sites during 2007.
-91-
CITY OF SHOREWOOD, MINNESOTA
NONMAJOR PROPRIETARY FUNDS
COMBINING STATEMENTS OF NET ASSETS
DECEMBER 31, 2010 AND 2009
621
Business -type Activities - Enterprise Funds
Recycling
Stormwater Management Utility
2010
2009
2010
2009
ASSETS
CURRENT ASSETS
Cash and temporary investments
$ 43,390
$ 88,814
$ 665,518 $
571,128
Receivables
Accrued interest
234
266
636
1,822
Accounts
40,757
14,287
51,470
46,996
Special assessments
569
; 748
1,498
1,618
TOTAL CURRENT ASSETS
84,950
104,115
719,122
621,564
NONCURRENT ASSETS
Special assessments receivable
3,709.
2,193
: , ,6,839:
6,393
Capital assets
Land
404,392
404,392
Infrastructure
793,312
793,312
Less accumulated depreciation
-
(180,377)
(160,544)
NET CAPITAL ASSETS
1,017,327
1,037,160
TOTAL NONCURRENT ASSETS
3,709
2,193
1,024,161
1,043,553
TOTAL ASSETS
88,659
106,308
1,743,283
1,665,117
LIABILITIES
CURRENT LIABILITIES
Accounts and contracts payable
396
14,367
2,594
3,237
Accrued salaries payable.
-
-
869
385
TOTAL LIABILITIES
396
14,367
3,463
3,622
NET ASSETS
Invested in capital assets
-
-
1,017,327
1,037,160
Unrestricted
88,263
91,941
722,493
624,335
TOTAL NET ASSETS
$ 88,263
$ 91,941
$ 1,739,820 $
1,661,495
621
Exhibit C -1
Business -type Activities - Enterprise Funds - Continued
Liquor Totals
2010 2009 2010 2009
$ $ 862,409 $ 708,908 $ 1,522,351
2,702 870 4,790
- 92,227 61,283
- 2,067 2,366
865,111 804,072 1,590,790
10,543 8,586
404,392 404,392
793,312 793
(180,377) _(160,544)
1,017,327 1,037,1,60
3 17,604
",869 385
3,859 17,989
- 1,017,327 1,037,160
865,111 810,756 1,581,387
$ $ 865,111 $ 1,828,083 $ 2,618,547
-93-
OPERATING REVENUES
Charges for services
OPERATING EXPENSES
Personal services
Supplies
Repairs and maintenance
Depreciation
Professional services
Contracted services
Other
CITY OF SHOREWOOD, MINNESOTA
NONMAJOR PROPRIETARY FUNDS
COMBINING STATEMENTS OF REVENUES, EXPENSES AND
CHANGES IN FUND NET ASSETS
FOR TIME YEARS ENDED DECEMBER 31, 2010 AND 2009
Business -type Activities - Enterprise Funds
Recycling Stormwater Management Utility
2010 2009 2010 . 2009
TOTAL OPERATING EXPENSES
OPERATING INCOME (LOSS)
NONOPERATING REVENUES
Interest on investments
Other income
TOTAL NONOPERATING REVENUES
INCOME (LOSS) BEFORE TRANSFERS
TRANSFERS OUT
CHANGE IS NET ASSETS
NET ASSETS,
NET ASSETS, DECEMBER 31
$ 146,002 $ 64,992 $ 198,470 $ 191,032
5,836
4,298
22,737
55,828
1,483
716
2,581
1,794
24,216
23,936
33,475
-
-
(10,358)
19,833
19,833
-
9,848
3,163
166,449
94J04
40,871
24,935
128
168
1,762
1
173,896
99,286
131A07
106
(27,894) „
(34.294):
67,363
84,185
656
986
5,637
4,990
23,560
22,950
5,325
5,783
24,216
23,936
10,962
10,773
(3,678)
(10,358)
78,325
94,958
(3,678)
(10,358)
78,325
94,958
91,941
102,299
1,661,495
1,566,537
$ 88,263 $
91,941
$ 1,739,820
$ 1,661495
-94-
Exhibit C -2
Business -type Activities - Enterprise Funds - Continued
Liquor Totals
2010 2009 2010 2009
- $ 344,472 $ 256,024
28,573 60,126
4,064 2,510
8,
8.
8.
(873,
(865,
865,
$
-95-
CITY OF SHOREWOOD, MINNESOTA
NONMAJOR PROPRIETARY FUNDS
COMBINING STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009
Business -type Activities - Enterprise Funds
Recycling Stoimwater Management Utility
2010 2009 2010 2009
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers and users
Other receipts
Payments to suppliers, contractors
and other governments
Payments to employees
NET CASH PROVIDED (USED)
BY OPERATING ACTIVITIES
CASH FLOWS FROM
NONCAPITAL FINANCING ACTIVITIES
Transfers out
CASH FLOWS FROM INVESTING ACTIVITIES
Interest received on investments
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS, JANUARY 1
CASH AND CASH EOUIVALENTS.7DECEMBER
RECONCILIATION OF OPERATING INCOME
TO NET CASII PROVIDED (USED)
BY OPERATING ACTIVITIES
Operating income (loss),
Adjustments to reconcile operating income
to net cash provided (used) by operating a
Other income related to operations
Depreciation
(Increase) decrease in assets:
Accounts receivable
Special assessments receivable
Increase (decrease) in liabilities:
Accounts payable
Accrued salaries payable
NET CASII PROVIDED (USED)
BY OPERATING ACTIVITIES
$ 118,195 $
66,660 $
193,675 S
195,434
23,560
22,950
5,325
5,783
(182,031)
(94,601)
(89,180)
(29,249)
(5,836)
(4,298)
(22,253)
(56314)
(1,337)
420
(46,112)
(9,289)
87,567
115,654
5,682
94,390 121,336
571,128 449,792
$ 665,518 $ 571,128
$ _ (27,894) $
(34,294) $
67,363 $
84,185
23,560
22,950
5,325
5,783
-
-
19,833
19,833
(26,470)
1,248
(4,474)
4,793
(1,337)
420
(321)
(391)
(13,971)
387
(643)
1,937
-
-
484
(486)
(46,112) $ (9,289) $ 87,567 S 115,654
-96-
Exhibit C -3
Business -type Activities - Enterprise Funds - Continued
Liquor Totals
2010 2009 2010 2009
$ - $ - $ 311,870 $ 262,094
- 28,885 28,733
(25) (129) (271,236) (123,979)
- - (28,089) (60,612)
(873;
11,
(862;
862,
$
(14,614) 2,324
484 (486)
$ (25) $ (129) $ 41,430 $ 106,236
-97-
ma
Charges for services
General government
CITY OF SHOREWOOD, MINNESOTA
', >, 6,000
Exhibit D -1
2,486
GENERAL FUND
Culture and recreation'
31,000
31,000
SCHEDULE OF REVENUES, EXPENDITURES AND
3,396
27,395
CHANGES
IN FUND BALANCES - CONTINUED ON THE FOLLOWING PAGES
37,000
37,000
BUDGET AND ACTUAI,
5,882
41,649
FOR THE YEAR ENDED DECEMBER 31, 2010
Fines and forfeitures
55,000
(With comparative actual amounts for the year ended December 31, 2009)
55,806
806
2010
Special assessments
2009
-
Budgeted Amounts Actual
Variance with
Actual
Original Final Amounts
Final Budget
Amounts
REVENUES
(48,233)
58,627
Miscellaneous revenue
Taxes
General property taxes
$ 4,680,428 $ 4,680,428 $ 4,654,064
$ (26,364)
$ 4,579,510
Fiscal disparities
63,140 63,140 63140
-
123,858
Total
4,743,568 4,743,568 ` '4,717,264:
(26,364)
4,703,368
820
Licenses and permits
32,000
32,000
26,380
Business
11,770 11,770 8,585
(3,185)
14,525
Nonbusiness
94.500 94,500 ' *745,528
.' =.51,028
113,358
Total
106,270 106,270 154,113
47,843
127,883
Charges for services
General government
,- 6,000
', >, 6,000
8,486
2,486
14,254
Culture and recreation'
31,000
31,000
34,396
3,396
27,395
Total -
37,000
37,000
42,882
5,882
41,649
Fines and forfeitures
55,000
55,000
55,806
806
52,968
Special assessments
-
-
333
333
-
Interest on investments
95.000
95,000
46,767
(48,233)
58,627
Miscellaneous revenue
Refunds and reimbursements
10,000
10,000
13,423
3,423
1 1,349
Contributions and donations
-
-
-
-
820
Other
32,000
32,000
26,380
(5,620)
11.,962
Total
42,000
42,000
39,803
(2,197)
24,131
TOTAL REVENUES
5,176,562
5,176,562
5,126,042
(50,520)
5,075,037
-99-
Finance
Personal services
CITY OF SHOREWOOD, MINNESOTA
178,584
Exhibit D -1
31,341
GENERAL FUND
Supplies
7,700
7,700
SCHEDULE OF REVENUES, EXPENDITURES AND
124
6,952
Other services and charges ,.
CHANGES IN FUND BALANCES - CONTINUED
7,500
7,546
(46)
BUDGET AND ACTUAL
Total
193,784
193,784
FOR THE YEAR ENDED DECEMBER 31, 2010
31,419
177,783
(With
comparative actual amounts for the year ended December 31, 2009)
2010
2009
199,000
Budgeted Amounts Actual
Variance with
Actual
223,858
Original Final Amounts
Final Budget
Amounts
EXPENDITURES
Personal services
Current
193,605
175,553
18,052
General government
Supplies
655
655
Mayor and Council
506
2,138
Other services and charges
Personal services
$ 16,794 $ 16,794 $;. 16;794
,$ -
$ 16,794
Supplies
1,200 1,200 1,175
25
3,064
Other services and charges
46,200 46,200 45,776,
424
46,158
Total
64,194 64,194 63,745
449
66,016
Administrative
Personal services
147,712 147,712 144,743
2,969
149,286
Supplies
-
-
40
Other services and charges
4,150 4,150 3,153
997
7.909
Total
151,862 151,862 147,896
3,966
157,235
City clerk / elections
Personal services
212;328; 212,328 254,550
(42,222)
220,596
Supplies
24,925 24,925 18,134
6,791
19,884
Other services and charges
35,005 35,005 32,727
2,278
31,532
Total
272,25 271258 305,411
(33,153)
272,012
Finance
Personal services
178,584
178,584
147,243
31,341
166,032
Supplies
7,700
7,700
7,576
124
6,952
Other services and charges ,.
7,500
7,500
7,546
(46)
4,799
Total
193,784
193,784
162,365
31,419
177,783
Professional services
Other services and charges -
199,000
199,000
178,604
20,396
223,858
Planning and zoning
Personal services
193,605
193,605
175,553
18,052
195,474
Supplies
655
655
149
506
2,138
Other services and charges
4,700
4,700
6,882
(2,182)
8,990
Total
198,960
198,960
182,584
16,376
206,602
9110111
CITY OF SHOREWOOD, MINNESOTA Exhibit D-1.
GENERALFUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - CONTINUED
BUDGET AND ACTUAL
FOR THE YEAR ENDED DECEMBER 31, 2010
(With comparative actual amounts For the year ended December 31, 2009)
EXPENDITURES - CONTINUED
Current - Continued
General government- Continued
Municipal building
Supplies
Other services and charges
Total
Total general government
Public safety
Police protection
Other services and charges
Fire protection
Other services and charges
Protective inspection
Personal services
Supplies
Other services and
2010 2009
Budgeted Amounts Actual Variance with Actual
Original Final Amounts Final Budget Amounts
$ 54,800 $ 54,800
133,000 133,000
187,800
1,267,858 1,267,858
950,000
.$ 2,703 $ 34,321
78,504 123,958
81,207 158
98 120,660 1,261,785
(704) 943,989
(6,677) 323,180
943 117,943 115,081 2,862 119,184
400 400 28 372 139
800 6,800 4,575 2,225 5,647
125,143 119,684 5,459 124,970
Total public
Public works
General maintenance
Personal services
Supplies
Other services and charges
Total
Streets and highways
Personal services
Supplies
Other services and charges
Total
1,391,001 1,392,923 (1,922) 1,392,139
295,372
295,372
289,827
5,545
279,601
71,123
71,123
62
9,080
58,800
42,690
42,690
41,107
1,583
40,539
409,185
409,185
392,977
16,208
378,940
$ 95,607
$ 95,607 $
88,822 $
6,785
$ 69,846
85,000
85,000
80,253
4,747
53,168
23,500
23,500
21,274
2.226
27,233
204,107
204,107
190,349
13,758
150,247
-101-
CITY OF SHOREWOOD, MINNESOTA
GENERALFUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - CONTINUED
BUDGET AND ACTUAL
FOR THE YEAR ENDED DECEMBER 31, 2010
(With comparative actual amount's for the year ended December 31, 2009)
EXPENDITURES - CONTINUED
Current - Continued
Public works - continued
Snow and ice removal
Personal services
Supplies
Total
Traffic control
Supplies
Other services and charges
Total
Sanitation and waste removal
Personal services
Supplies
Other services and charges
Total
Tree maintenance
Personal services
Supplies
Other'serviees and charges
Total
City engineer
Personal services
Supplies
Other services and charges
Total
Total public works
Exhibit D -1 '
-102-
2010
2009
Budgeted
Amounts
Actual
Variance with
Actual
Original
Final
Amount's
Final Budget
Amounts
40,857
40,857
55,052
(14,195)
35,995
45,117
45,117
32,453
38,457
85,974
85,974
87,505
(1,531)
74,452
6,000
6,000
2.528
' 3,472
3,412
45,049
45,049
46,893
4,156
42,291
51.,049
51,049
43,421'.
7,628
45,703
5,827
(5,827)
2,764
500
500
-
500
21
4,400
4,400
3,210
1,190
-
4,900. !
4,900
9,037
(4,137)
2,785
17,279
17,279
20,626
(3,347)
7,513
2,700
2,700
107
2,593
437
13,500
13,500
11,461
2,039
9,501
33,479
33,479
32,194
1,285
17,451
94,875
94,875
94,497
378
114,547
425
425
152
273
741
15,146
15,146
8,937
6,209
7,639
110,446
110,446
103,586
6,860
122,927
899,140
899,1.40
859,069
40,071
792,505 '..
-102-
CITY OF SHOREWOOD, MINNESOTA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - CONTINUED
BUDGET AND ACTUAL
FOR THE YEAR ENDED DECEMBER 31, 2010
(With comparative actual amounts for the year ended December 31, 2009)
2010
Exhibit D -1
2009
103-
Budgeted Amounts
Actual
Variance with
Actual
Original
Final
Amounts
Final Budget
Amounts
EXPENDITURES - CONTINUED
Current - Continued
Culture and recreation
Personal services $
160,481
$ 160,481
$ 153,637
$ 6,844
$ 147,532
Supplies
16,300
16,300
z. 14,236
2,064
10,094
Other services and charges
92,600
92.600
96,055;
(3,455)
109,781
Total culture and recreation
269,381
269,381
263,928
5,453
267,407
Total current expenditures
3,827,380
3,827,380
3,463,118
1,64,262
3,713,836
Capital outlay
General government
25,600
25,600
18,557'
- 7,043
9,023
Public safety
509,624
509,624`
500,697!
8,927
511,508
Public works
4,800
r 4,800
538
4,262
7,857
Total capital outlay
540,024 1
540,024
` 519,792
20,232
528,388
Debt service
Interest and service charges
g
2,959
(2,959)
5,425
TOTAL EXPENDITURES
', 4,367,404
4,185,869
181,535
4,247,649
EXCESS OF REVENUES
OVER EXPENDITUR7S
809,158
" 809,158
940,173
131,015
827,388
OTHER FINANCING SOURCE'S (USES)
Transfers in
43,842
43,842
33,464
(10,378)
40,000
Transfers out
(1,008,000)
(1,008,000)
(1,002,369)
5,631
(1,019,773)
TOTAL OTHER FINANCING
SOURCES (USES)
(964,158)
(964,158)
(968,905)
(4,747)
(979,773)
NET CHANGE INr FUND BALANCES
(155,000)
(155,000)
(28,732)
126,268
(152,385)
FUND BALANCES, JANUARY 1
3,555,724
3,555,724
3,555,724
-
3,708,109
FUND BALANCES, DECEMBER 31 $
3,400.724
$ 3,400,724
$ 3,526,992
$ 126,268
$ 3,555,724
103-
ASSETS
Cash and temporary investments
Cash with fiscal agent
Receivables
Lease
TOTAL ASSETS
LIABILITIES AND FUND BALANCES
LIABILITIES
Deferred revenue
FUND BALANCES
Reserved for
Debt service
TOTAL LIABILITIES AND
FUN
CITY OF SHOREWOOD, MINNESOTA
DEBT SERVICE FUNDS
COMBINING BALANCE SHEET
DECEMBER 31, 2010
Waterford 2007A
2007B
2007C
III Tax Public Safety
Public Safety
Public Safety
Increment Building
Building
Building
$ - $ 45,276
$ 29,061
$ 11,413
- 2,645
3,532
1,198
- 3,960,000
4,105,000
1,490,000
$ $ 4,007,92i
,, $ - 4,137,593
$ 1,502,611
$ $ 3,960,000
$ 4,105,000
$ 1,490,000
47,921 32,593 12,611
$ 4,137,593 $ 1,502,611
104-
Exhibit E -I
2008
Lease Revenue
Bond Total
3,208 $ 88,958
- 7,375
9,555,000
$ 3,
3 ,
$ 3,
105-
CITY OF SHOREWOOD, MINNESOTA
DEBT SERVICE FUNDS
COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
FOR THE YEAR ENDED DECEMBER 31, 2010
REVENUES
Lease payments $
Interest on investments
TOTAL REVENUES
Waterford 2007A 2007B 2007C
III Tax Public Safety Public Safety Public Safety
Increment Building Building Building
- $ 982,037 $ - $ -
114 38,403 65 25
114 1,020,440 65 25
EXPENDITURES
27,970
28,996
Debt service
Bonds refunded
(1,900,000)
Principal
280,000
180,000
95,000
Interest and service charges
219,746
176,403
61,691
TOTAL EXPENDITURES
499,746
356,403
156,691
(12,135)
(1,872,030)
EXCESS (DEFICIENCY) OF REVENUES
11,388
NET CHANGE IN FUND BALANCES
(12,021)
OVER (UNDER) EXPENDITURES
114 520,694
(356,338)
(156,666)
OTHER FINANCING SOURCES (USES)
Transfers in
27,970
28,996
11,388
Bonds refunded
(1,900,000)
Transfer out
(12,135)
TOTAL OTHER
FINANCING SOURCES (USES)
(12,135)
(1,872,030)
28,996
11,388
NET CHANGE IN FUND BALANCES
(12,021)
(1,351,336)
(327,342)
(145,278)
FUND BALANCES, JANUARY ,1
12,021
1,399,257
359,935
157,889
FUND BALANCES, DECEMBER 31
$ -
$ 47,921 $
32,593
$ 12,611
woZS
Exhibit E -2
2008
Lease Revenue
Bond Total
$ - $ 982,037
19 38,626
19 1.020.663
-107-
CITY OF SHOREWOOD, MINNESOTA
AGENCY FUND
COMBINING SCHEDULE OF CHANGES IN ASSETS AND LIABILITIES
FOR THE YEAR ENDED DECEMBER 31, 2010
Balance
January I Additions Deductions
Developer Escrow Accounts
ASSETS
Cash and temporary investments
LIABILITIES
Accounts payable
Escrow deposits payable
TOTAL LIABILITIES
Exhibit F -1
Balance
December 31
$ 124,728 $ 7,025 $ (11,155) $ 120,598
$ 8,155 $ 3,000 $ (11,155) $ -
116,573 7,025 (3,000) 120,598
$ 124,728 $ 10,025 $� (14,155) $ 120,598
milli
SUPPLEMENTARY
(UNAUDI,
CITY OF SIT
SHOREWOOD,
FOR THE
-109-
110-
CITY OF SHOREWOOD, MINNESOTA
SUPPLEMENTARY INFORMATION
SUMMARY FINANCIAL REPORT
REVENUES AND EXPENDITURES FOR GENERAL OPERATIONS
GOVERNMENTALFUNDS
FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009
Total
2010 2009
REVENUES
Taxes
Licenses and permits
Intergovernmental
Charges for services
Fines and forfeits
Special assessments
Interest on investments
Miscellaneous
TOTAL REVENUES
Per Capita
EXPENDITURES
Current
General government
Public safety
Public works
Culture and recreation
Capital outlay
General government_
Public safety
Public works
Culture and recreation
Debt service
Principal
Interest and service ch,
TOTAL EXPENDITURES
Per Capita
Total Long -term Indebtedness
Per Capita
$ 4,717,204
154,113
173,334
$ 4,703,368
127,883
66,411
41,649
52,968
333,626
1,059,914
$ 6,385,819
$ 805
$ 1147
$
1,386,614
1,392,923
1,392,139
859,069
670,954
342,654
326,502
27,506
671,978
500,699
511,519
1,284,911
730,849
261,993
39,410
600,000
520,000
516,167
818,063
$ 6,933,120
$
7,068,028
$ 949
S
891
$ 10,795,000
S
13,295,000
1,477
1,677
Exhibit Gl
Percent
Increase
(Decrease)
0.29 %
20.51
161.00
142.26
5.36
n/a
(60.33)
(2.11)
(0.22) %
8.27
(17.27) %
0.06
28.04
4.95
(95.91)
(2.12)
75.81
564.79
15.38
(36.90)
(1.91) %
6.44
(18.80) %
(11.89)
General Fund Balance - December 31 $ 3,526,992 $ 3,555,724 (0.81) %
Per Capita 483 448 7.64
The purpose of this report is to provide a summary of financial information concerning the City of Shorewood to interested
citizens. The complete financial statements may be examined at City Hall, 5755 Country Club Road. Questions
about this report should be directed to Bruce DeJong, Finance Director at (952)474 -3236.
III-
112-
SEC7IONIII
STATISTICAL SECTION
(UNAUDITED)
CITY OF SHOREWOOD
SHOREWOOD, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2010
-113-
114-
STATISTICAL SECTION
This part of the City of Shorewood's comprehensive annual financial report presents detailed information as a context for
understanding what the information in the financial statements, note disclosures, and required supplementary information says
about the government's overall financial health.
Financial trends
These schedules contain trend information to help the reader under
well -being have changed over time.
Revenue capacity
These schedules contain information to help the reader assess the
property tax.
Debt capacity
These schedules present information to help the reader assess the a
outstanding debt and the government's ability to issue additional d
Demographic and economic information
These schedules offer
the government's fim
Operating
These schedules contain service and infrw
government's financial report relocates to
how the government's ,fir,
nment's most significant
performance and
revenue source, the
government's current levels of
in
to help the reader understand the environment within which
data to help the reader understand how the information in the
ces the government provides and the activities itperforms.
115-
CITY OF SHOREWOOD, MINNESOTA
STATISTICAL SECTION (UNAUDITED)
NET ASSETS BY COMPONENT
LAST SEVEN FISCAL YEARS
(accrual basis of accounting)
Governmental activities
Invested in capital assets, net of related debt
Restricted
Unrestricted
Total governmental activities net assets
Business -type activities
Invested in capital assets, net of related debt
Unrestricted
Total business -type activities net assets
Total primary government
Invested in c
Restricted
Unrestricted
Total prim
Note: Net asse
Fiscal Year
2004 2005 2006
$ 12,167,269 $ 11,372,213 $ 11,690,620
- - 24,632
6,669,073 6,316,707 5,716,027
$ 18,836,342 $ 17,688,920 $ 17,431,279
6,172,309 $ 5,668,683
8,182,612 9,829,761
4,354 =� $ 1.5,498,444
$ 17,544,522 $ 17,359,303
- 24,632
14,499,319 15,545,788
$ 32,043,841 $ 32,929,723
-116-
Table 1
Fiscal Year
2007 2008 2009 2010
$ 10,960,550 $ 9,430,566 $ 9,480,314 $ 9,525,991
-117-
6,147,185
7,400,859
7,909,106
8,252,497
$
17,107,735
$
16,831,425
$
17,389,420
$
17,778,488
$
6,066,229
$
6,631,854
$
6,482,297
$
6,494,996.
10,422,397
10,186,824
9,449,210
8,666,149
$
16,488,626
$
16,818,678
$
15,931,507
$
15,161,145
$
17,026,779
$
16,062,420
$
15,962,611
$
16,020,987 ;
16,569,582
17,587,683
17,358,316
16,918,646�
$
33,596,361
$
33,650,103
$
33,320,927 +.
$
32,939,633
-117-
CITY OF SHOREWOOD, MINNESOTA
STATISTICAL SECTION (UNAUDITED)
CHANGES IN NET ASSETS - CONTINUED ON THE FOLLOWING PAGES
LAST SEVEN FISCAL YEARS
(accrual basis of accounting)
Fiscal Year ''..
2004 2005 2006
Expenses
Governmental activities
General government
Public safety
Public works
Culture and recreation
Interest on long -term debt
Total governmental activities expenses
Business -type activities
Water
Sewer
Recycling
Stormwater management utility
Liquor
Total business -type activities expenses
Total expenses
Program revenues
Governmental activities
Charges for services
General government
Public safety
Public works
Culture and recreatic
Operating grants and c
Capital grants and com
Total governmental
Business -type activities
Charges for services
Water
Sewer
Recycling
Stormwater management utility
Liquor
Operating grants and contributions
Total business -type activities program revenues
Total program revenues
$ 1,074,028
$ 1,222,510
$ 1,357,714
2,972,094
1,690,903
L806,915
2,451,825
5,019,967
2,275,402
254,081
246,381
233,881
607,862
606,189
600,723
7,359,890
3,674,717
6,274,635
$ 6,039.037
$ 7,417.908
$ 5,959,759
591,858
567,854
488,513
735,480
740,17.4
785,638
106,933
,J05,823
124,354
.106,757
73,885
171,190
2,152,41;1...
2,006,107
2,017,217
3,693,439
3,493,843
3,586,912
$' 11,053,329
$ 12,279,793
$ 9,861,547
$ 51,069
$ 112,107
$ 25,340
983,684
1,055,758
1,060, 506
1,080
1,575
1,800
119,594
100,910
31,730
996,967
2,404,367
395,229
2,152,394
3,674,717
1,514,605
620,189
649,772
1,350,041
866,350
833,939
836,175
114,987
116,517
144,886
85,978
102,649
129,708
2,199,139
2,040,314
1,984,344
3,886,643
3,743,191
4,445,154
$ 6,039.037
$ 7,417.908
$ 5,959,759
-118-
Table 2
2007
Fiscal Year
2008 2009 2010
$ 1,321,971
$ 1,483,913
$ 1,486,281
$ 1,235,098
1,819,250
1,906,890
1,904,966
1,893,413
1,971,571
2,485,752
1,941,272
2,231,473
258,906
273,054
394,110
452,437
1,000,230
1,002,423
638,768
474,082
-
27,950
28,488
28,762
6,371,928
7,152,032
6,365,397
6,286,503
$ 4,831,565
$ 3,469,662
$ 2,672,979
$ 2,836,892
636,506
657,776
659,113
643,886
952,107
921,238
955,956
980,173
91,157
96,945
99,286
173,896
63,888
106,143
106,847
131,107
1,885,537
16,167
129
25
3,629,195
1,798,269
1,821,331
1,929,087
$ 10,001,123
$ 8,950,301
$ 8,186,728
$__ 8,215,590
$ 4L475 $ 32,528 `$' 34
896,731 793,041 634
- - b
1,960 605 35
99,8q,0 ,90,493 9C
132,912 674,343
1,172,878 1,591,010 801
782,549
752,338
784,318
668,676
832,956
829,117
�- 802,252
845,043
89,934
64,629
65,112
146,002
164,413
204,618
191,157
198,593
1,788,835
-
-
-
-
27,950
28,488
28,762
3,658,687
1,878,652
1,871,327
1,887,076
$ 4,831,565
$ 3,469,662
$ 2,672,979
$ 2,836,892
119-
681 99,114
43 114,330
652 949,81.6
CITY OF SHOREWOOD, MINNESOTA
STATISTICAL SECTION (UNAUDITED)
CHANGES IN NET ASSETS - CONTINUED
LAST SEVEN FISCAL YEARS
(accrual basis of accounting)
Fiscal Year
Net revenues (expenses)
Governmental activities
Business -type activities
Total primary government
General Revenues and Other Changes in Net Assets
General Revenues
Governmental activities
Taxes
Property taxes, levied for general purpose
Grants and contributions not restricted to specific programs
Unrestricted investment earnings
Gain on sale of capital assets
Transfers
Total governmental activities general revenues
Business -type activities
Unrestricted investment earnings
Gain on sale of capital assets
Transfers
Total business -type activities general revenues
Total primary government
2004 2005 2006
$ (5,207,496) $ (5,111,233) $ (4,760,030)
193,204 249,348 858,242
$ (5,014,292) $ (4.861,885) $ (3,901,788)
4,723
127,853
3,770,702 $ 4,144,543
4,785
4,925
201,024
327,921
4,300
-
(17,000)
25,000
3,963,811
4,502,389
190,943 310,281
17,000 (25,000)
207,943 285,281
$ 3622,065 $ 4,171,754 $ 4 887,670
Change in Net Assets
Governmental- activit
Business-typee aetiviti
Total primary
Note: Changes in net assets are not available for years prior to 2004
$ (1,724,594) $ (1,147,422) $ (257,641)
332,367 457,291 1,143,523
$ (1,392,227) $ (690,131) $ 885,882
-120-
Table 2
Fiscal Year
2007 2008 2009 2010
$ (5,199,050) $ (5,561,022) $ (5,563,745) $ (5,336,687)
29,492 80,383 49,996 (42,011)
$ (5,169,558) $ (5,480,639) $ (5,513,749) $ (5.378,698)
$ 4
4
$ S
$
$
121'
CITY OF SHOREWOOD, MINNESOTA.
STATISTICAL SECTION (UNAUDITED)
FUND BALANCES OF GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
General fund
Reserved
Unreserved
Total general fund
All other governmental funds
Reserved
Unreserved, reported in:
Debt service funds
Special revenue funds
Capital project funds
Total all other govermnental funds
Fiscal Year
2001 2002 2003 2004
$ 117,760 $ 44,994 $ - $
1,905,309 2,112,984 2,546,472 2,941,223
$ 2,023,069 $ 2,157,978 $ 2,546,472 $ 2,941,223
$ 231,421 $ 246,283 $ 205,350 $ 191,410
-
(8,342)
2,560,347 10,081,83„8 4,562,479 3,566,803
$ 2,783,426 _$ 10,290,619!$ 4.267 ,829 _$L 3,758,213
122-
Table 3
Fiscal Year
2005 2006 2007 2008 2009 2010
$ 48,593 $ - $ - $ 47,750 $ 500 $ 49,060
2,944,588 3,383,906 3,761,509 3,660,359 3,555,224 3,477,932
$ 2,993,181 $ 3,383,906 $ 3,761,509 $ 3,708,109 $ 3,555,724 $ 3,526,992
$ 238,873 $ 262,438 $ 10,040,556 $
3,116,437 2,197,367 2,473,097
$ 3,355,
743
$ 96,333
7,650)
-123-
Excess (deficiency) of revenues
over (under) expenditures 1,277,446 (2,327,897) (7,502,674) (619,865)
Other financing sources (uses')
Transfers in 554,000 629,1.00 391,107 328,500
Sale of capital assets - - - -
Proceeds from sale of bonds - 9,950,000 2,368,378
Bonds refunded - -
Discount on long -term debt issued - - - -
Transfers out (539,000) (609,100) (391,107) (323,500)
Total other financing
sources (uses) 15,000 9,970,000 2,368,378 5,000
Net change in fund balances S 1,292,446 $ 7,642,103 $ (5,134,296) $ (614,865)
Debt service as a percentage of
Noncapital expenditures 6.6% 5.8% 16.2% 11.2%
-124-
CITY OF SHOREWOOD, MINNESOTA
STATISTICAL SECTION (UNAUDITED)
CHANGES IN FUND BALANCES OF GOVERNMENTAL
FUNDS
'..
LAST TEN FISCAL YEARS
Fiscal Year
2001
2002
2003
2004
Revenues
Taxes
$ 2,206,525 $
2,658,663 $
3,071,853
$ 3,344,442
Licenses and permits
349,515
229,234
334,424
310,055
Intergovernmental
3,104,043
171,783
1,947,484
1,014,410
Charges for services
42,222
46,079
48,689
44,169',.
Fines and forfeitures
61,243
89,632
88,949
81,841
Special assessments
52,485
9,235
10,217
10,737
Interest on investments
225,500
. 283,024
146,331
127,853
Miscellaneous
71,236
375,510
551,167
740,030 .
Total revenues
6,112,769
3,863,160;
6,199,114
5,673,537
Expenditures
General government
989,502
1,001,921
1,038,909
1,037,043
Public safety
893,070
1,008,792
999,049
1,028,689 j
Public works
487,092
428,530;..
420,608
477,596
Culture and recreation
126,139
160,115 `
164,540
168,278
Capital Outlay
2,164,146
3,433,022
10,571,521
2,896,330
Debt service
Principal
148,358
139,833
46,402
48,069
Interest and service charges
27,016
18,844
460,759
637,397
Bond issuance costs
Total expenditures
4,835,323
6,191,057
13,701,788
6,293,402
Excess (deficiency) of revenues
over (under) expenditures 1,277,446 (2,327,897) (7,502,674) (619,865)
Other financing sources (uses')
Transfers in 554,000 629,1.00 391,107 328,500
Sale of capital assets - - - -
Proceeds from sale of bonds - 9,950,000 2,368,378
Bonds refunded - -
Discount on long -term debt issued - - - -
Transfers out (539,000) (609,100) (391,107) (323,500)
Total other financing
sources (uses) 15,000 9,970,000 2,368,378 5,000
Net change in fund balances S 1,292,446 $ 7,642,103 $ (5,134,296) $ (614,865)
Debt service as a percentage of
Noncapital expenditures 6.6% 5.8% 16.2% 11.2%
-124-
Table 4
Fiscal Year
2005
2006
2007
$ 3,750,633
$ 4,141,539
$ 4,332,741
334,720
382,408
256,472
2,432,656
365,732
224,286
50,752
45,450
50,819
90,149
79,040
77,777
6,928
895
418
201,024
327,921
621,234
1,134,429
1,110,860
1,077,012
8,001,291
6,453,845
6,640,759
1,169,096
1,264,509
1,253,223
1,124,620
1,257,998
1,263,921
570,080
626,048
718,350
167,519
169,411
190,931
4,307,721
2,571,204
1,123,796
384,842
486,728
534,594
611,358
607,727
956,532
8,335,236
2008
2009
2010
$ 4,582,602
$ 4,703,368
$ 4,717,204
195,419
127,883
154,113
753,605
66,411
173,334
50,753
41,649
100,899
53,369
52,968
55,806
977,957
818,063
333
641,846
333,626
132,359
1,053,916
! .1,059,914,.
1,037,522
1,443, 549
1,3 86,614
1,147,198
1,352,254
1,392,,,139
1,392,923
760,287
670,954
859,069
229,259
326,502,
342,654
2
1,953,756
2,075,109
485,000
520,000
600,000
977,957
818,063
516,167
58.569
-
-
7,068,028 6,933,120
(682,209) (561,550)
542,000
635,000
770,091
933,366
2,059,773
1,942,550
-
-
-
-
-
31,130
-
10,000,000
1,310,000
(8,100,000)
-
-
-
(1,900,000)
-
-
(24,233)
-
-
-
(559,000)
(610,000)
(913,819)
(893,366)
(1,019,773)
(1,129,119)
(17,000)
25,000
9,832,039
1,350,000
(7,060,000)
(1,055,439)
(504,780)
$ 10,431,451
$ 1,210,269
$ (7,742,209)
$ (1,616,989)
12.7%
20.1%
26.3%
23.1%
22.4%
19.1%
-125-
CITY OF SHOREWOOD, MINNESOTA
STATISTICAL. SECTION (UNAUDITED)
TAX CAPACITY, MARKET VALUE AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY
(Shown by year of tax colleetability)
Taxable market value
Personal property
Real estate
Total taxable market value
Estimated actual value of taxable property
Taxable market value as a percentage of
estimated actual value
Tax capacity
Personal property
Real estate
Total tax capacity
Contribution to fiscal disparities pool
Receivable from fiscal disparities pool
Net tax capacity
Tax levies
General
Debt service
Total
Direct tax rate
General
Debt service'"
Total
Source: Hennepin County Asst
Note: Property in the county is
2001 2002 2003 2004
$ - $ - $ 3,962,200 $ 3,831,300
914,769,800 1,033,460,200
$ 756,858,900 $ 817,063,900 $ 918,732,000 $ 1,037,291,500
$ 795,637,300 $ 914,769,800 $ 1,066,523,800 $ 1,415,129,000
95.13 %
% 73.30 %
78,073. $ 75,409
55,728 10,980,358
11,344,958
'8,690352
9,736,801
11,055,767
(253,832)
(171,024)
(184,657)
(200,062)
426,424 ;
314,412
344,682
396,666
11,517,550 $
8,833,940 $
9,896,826 $
11,252,371
2,208,574 ;$
2.763,367 $
2,851,847 $
2,907,997
-
-
305,000
512,232
2,268,574 $
2,763,367 $
3,156,847 $
3,420,229
19.208 '%
31.923 %
28.816 %
25.843 %
-
-
3.082
4.552
19.208 %
31.923 %
31.898 %
30.396 %
The county assesses property at approximately 90 percent of
Note: Information not available prior to 2003 for the allocation of taxable market value and tax capacity between
personal property and real estate.
-126-
Table 5
-127-
2005
2006
2007
2008
2009
2010
$
4,130,300
$
4,361,600
$
4,591,200
$
4,336,600
$
4,764,900
$
4,629,900
1,173,029,000
1,318,313,000
1,475,529,200
1,597,262,400
1,651,054,700
1,63L938,000
$
1,177,159,300
$
1,322,674,600
$
1,480,120,400
$
1,601,599,000
$
1,655.819,600
$
1,636.567,900
$
1,550,488,900
$
1,416,341,600
$
1,553,767,900
$
1,645,188,300
$
1,673,720,100
$
1,638,118,400
75.92 %
93.39 %
95.26 %
97.35'
99.93 %
99.91 %
$
81,333
$
85,635
$
89,872
$
$4,780
$
91,548
$.
88,848
12,590,290
14,269,195
16,130,097
17,619,94
18,305;174.
18,087,557
12,671,623
14,354,830
16,219,969
17,704,723
18,396,662 "
18,176,405
(213,988)
(276,939)
(308,590)
(351,789)
. (396,336)
(432,995)
379,072
399,944
407,687
445,780
'„ 513,259
526,521
$
12,836,707
$
14,477,835
$
16,319,066
'$
17,798,71,4.
$
, 18,513,585
$
18,269,931
$
3,333,864
$
3,678,592
$
3,83
$
';'4,056,917
$
4,158,672
$
4,160,292
496,792
511,803
, '561,135
', 555,678
617,620
616,000
a'
$
3,830,656
$
4,140,395
$'
, 4,396,308
$
4,611,995
$
4,776,292
$
4,776,292
25.971 °%
25.408 %
. '285501 %
22.793 %
21463 %
22.771 %
3.870'
3.535
1439
3.119
3.336
3.372
29.841 %
28.944 %
.26.940 %
25.912 %
25.799 %
26.143 %
-127-
CITY OF SHOREWOOD, MINNESOTA
STATISTICAL SECTION (UNAUDITED)
PROPERTY TAX CAPACITY RATES - DIRECT AND OVERLAPPING GOVERNMENTS
(PER $1,000 OF TAX CAPACITY IN 2001 - 2010)
Source: Hennepin County Assessor
(1) Includes vocational school
Overlapping r<
rates apply to <
property owne
that apply to property owners within the City. Not all overlapping
ial districts apply only to the proportion of the government's
0p, boundaries of the special district).
-128-
Overlapping Rates
Year
(1)
Taxes
School District
Watershed
District
Payable
City
County
No. 276
No. 277
No.3
No.4
Misc.
2001
19.208 %
37.624 %
47.155 %
40.246 %
1.363 %
0.946 %
7.916 %
2002
31.923
50.409
20.868
25.504
2.461
1.608
7.386
2003
31.898
50.607
24.215
20.758 -
1 236
1.616
7.757
2004
30.396
47.324
23.125
14.354
0.768
0.732
7.488
2005
29.841
44.172
21.989
16.250
1.276
1.375
7.382
2006
28.944
41.016
22.952
10.522
1.072
0.787
6.998
2007
26.940
39.110
24.793
9.911
1.121
0.943
7.310
2008
25.912
38.571
17.980
8.521
1A04
1.302
7.397
2009
25.799
40.413
17.186
8.284
1.489,.
1.246
7.154
2010
26.143
42.640
18.657
9.772 .,
1.511;
1.279
8.138
Source: Hennepin County Assessor
(1) Includes vocational school
Overlapping r<
rates apply to <
property owne
that apply to property owners within the City. Not all overlapping
ial districts apply only to the proportion of the government's
0p, boundaries of the special district).
-128-
Table 6
Totals
112.966
112.355
115.738
109.125
104.644
100.958
99.224
91.264
92.041
97.089
-129-
% 112.549 % 106.057 %
School
School District No. 276
District
No. 277
Watershed Watershed
Watershed
District District
District
No.3 No.4
No.3
112.966
112.355
115.738
109.125
104.644
100.958
99.224
91.264
92.041
97.089
-129-
% 112.549 % 106.057 %
CITY OF SHOREWOOD, MINNESOTA
STATISTICAL SECTION (UNAUDITED)
PRINCIPAL TAXPAYERS
DECEMBER 31, 2010
2010
Totals
Source: He
Tax
Taxpayer
Capacity
Rank
Tax Capacity
Big Box One, LLC
$ 266,507
Shorewood Village Shopping Center, Inc.
217,186
Two S Properties
181,446
South Lake Office Building LLC
122,736
Jack & Gretchen Norqual
113,1'08.
Minnetonka Country Club
95,363
Niccum & Shorewood Yacht Club
95,355
Waterford Center LLP
75,641
Elaine & Gary Jarrett
;" 69,846
Steven R. Litman Trustee
63,719
First State Bank Excelsior (Beacon Bank)
Thomas J. & Cynthia J. Redmond
Xcel Energy (formerly Northern States Power Company)
Second Half LLC
Lawrence Reid
Totals
Source: He
7.12 %
-130-
Percent
of Total
Rank
Tax Capacity
1
1.46 %
2
1.19
3
0.99
4
0.67
5
0.62
6
0.52
7
0.52
8
0.41
9
0.38
10
0.35
7.12 %
-130-
Table 7
2001
Percent
Tax of Total
Capacity Rank Tax Capacity
59,700 5 0.52
127,792 1 1.11
64,
78,
35,
66,
33,
28,
27,
24,
547;
-131-
CITY OF SHOREWOOD, MINNESOTA Table 8
STATISTICAL SECTION (UNAUDITED)
PROPERTY TAX LEVIES AND COLLECTIONS
LAST TEN FISCAL YEARS
(1) Includes state paid property tax credits
132-
(1)
Percent
Collection
Percentage
Collection
of Total
Fiscal
Total
of Current
of Levy
in subsequent
Total
Collections
Year
Levy
Year's Levy
Collected
years
Collections
to Levy
2001
$ 2,208,574
$ 2,188,665
99.10 %
$ 13,056
$ 2,201,721
99.69 %
2002
2,763,367
2,734,632
98.96
19,594
2,754,226
99.67
2003
3,156,847
3,131,798
99.21
28,193
3,159,991
100.10
2004
3,420,229
3,390,137
99.12
29,754
3,419,891
99.99
2005
3,830,656
3,783,074
98.76
. 46,458
3,829,532
99.97
2006
4,190,395
4,145,829
98.94
40,780_
4,186,609
99.91
2007
4,396,308
4,320,289
98.27
68,742':.
4,389,031
99.83
2008
4,611,995
4,546,899
98.59
47,438 !
-. 4,594,337
99.62
2009
4,776,292
4,649,904
9735
94,271
4,744,175
99.33
2010
4,776,292
4,685,060
98.09
-
4,685,060;
98.09
(1) Includes state paid property tax credits
132-
Table 9
CITY OF SHOREWOOD. MINNESOTA
STATISTICAL SECTION (UNAUDITED)
RATIO OF NET BONDED DEBT TO
ASSESSED VALUE AND NET BONDED DEBT PER CAPITA
LAST TEN FISCAL YEARS
See the Demographic and Economic Statistics table on page 139 for personal income and
Business -
Type
Governmental Activities ,'
Activities
General
Lease
General
Total
Percentage of
Fiscal
Obligation
Revenue
Capital
Obligation
Primary
Personal
Per
Year
Bonds
Bonds
Lease's
Revenue Bonds
Government
Income
Capita
2001
$ 155,000
S -
$ 210,468
$ 1,915,000
$ 2,280,468
0.69 %
S 302
2002
40,000
9,950,000 ,
185;635
1,730,000
11,905,635
3.57
1,569
2003
20,000
12,365;000
159233"
2,360,000
14,904,233
433
1,962
2004
-
12,365,000
13'1;134'
2,170,000
14,666,134
4.00
1,923
2005
12,010,000
101,322
2,745,000
14,856,322
3.97
1,967
W 2006
-
11,555,000
69,594
1920,000
15,544,594
4.18
2,073
2007
-
21,090,000
3,665,000
24,755,000
6.56
3,301
2008
-
21,915,000
3,415,000
25,330,000
5.88
3
2009
13,295,000
3,'165,000
16,460,000
3.81
2,076
2010
10,795,000
' -
2,915,000
13,710,000
3.19
1,876
Note: Details regarding the City's outstanding
debt can be found in the
notes to the financial statements.
See the Demographic and Economic Statistics table on page 139 for personal income and
2004 -
2005 -
2006 -
2007 -
2008 -
2009 -
2010 -
Note: Details regarding the City's outstanding debt can be found
See the Demographic and Economic Statistics table on page 139,
See the Tax Capacity, Market Value and Estimated Actual Valor
value information.
table on pages 126 - 127 for property
1.34-
CITY OF SHOREWOOD, MINNESOTA
Table 10
STATISTICAL SECTION (UNAUDITED)
RATIOS OF GENERAL BONDED DEBT OUTSTANDING
LAST TEN FISCAL YEARS
Less
Amounts
Percentage of
General Available in Net
Estimated Actual
Fiscal
Obligation Debt Service Bonded
Value of
Per
Year
Bonds Funds Debt
Taxable Property
Capita
2001
$ 155,000 $ 221,837 $ (66,837)
(0.01) %
$ (9)
2002
40,000 116,688 (76,688)
(0.01)
(10)
2003
20,000 108,925 (88,925)
(0.01)
(12)
2004 -
2005 -
2006 -
2007 -
2008 -
2009 -
2010 -
Note: Details regarding the City's outstanding debt can be found
See the Demographic and Economic Statistics table on page 139,
See the Tax Capacity, Market Value and Estimated Actual Valor
value information.
table on pages 126 - 127 for property
1.34-
CITY OF SHOREWOOD, MINNESOTA Table 11
STATISTICAL SECTION (UNAUDITED)
COMPUTATION OF DIRECT AND OVERLAPPING DEBT
DECEMBER 31, 2010
Sources : Market value data used to estimate applicable percentages provided by the "County Board of Equalization
and Assessment. Debt outstanding data provided by the county.
Note: 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 residents and
businesses of the City.? This process recognized that, when considering the government's ability to issue and repay long -term
debt, the entire debt burden borne by the residents'and businesses should be taken into account. However, this does not
imply that every taxpayer is aresident, and therefore responsible for repaying the debt, of each overlapping government.
* The percentage of overlapping debt applicable is estimated using taxable market property values. Applicable
percentages were estimated by determining the portion of the county's taxable market value that is within the City's
boundaries and dividing it by the county's total taxable market value.
-135-
Gross
Amount
Bonded
of
Debt Used
Percentage
Net Debt
For Net Debt
Net
Applicable to
Applicable
Calculation
Debt
District
to District
Direct Debt
City of Shorewood
$
$
100.00 %
$
Overlapping Debt
School District 9276
$ 106,149,548
$ 86,764,682
19.78 %
$
17,162,054
School District 9277
8,075,000
7,817,602
2.47
193,095
Hennepin County
690,350,000
683,934,500
1.23
8,412,394
Henn Suburban Park District
78,780,000
67,360,065
1.66
1,118,177
Henn Regional RR Authority
41,865,000
39,570,778
1.23
486,721
Metropolitan Council
245,200,000
181,078,9p3
0.56
1,014,042
Total Overlapping Debt
$ 1,170,419,548
_$ 1,066,526,530
2.66 %
$
28,386,483
Total Direct and Overlapping Debt
$ 1,170,419548
$ 1,0 66,530
2.66 %
$
28,386,483
Sources : Market value data used to estimate applicable percentages provided by the "County Board of Equalization
and Assessment. Debt outstanding data provided by the county.
Note: 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 residents and
businesses of the City.? This process recognized that, when considering the government's ability to issue and repay long -term
debt, the entire debt burden borne by the residents'and businesses should be taken into account. However, this does not
imply that every taxpayer is aresident, and therefore responsible for repaying the debt, of each overlapping government.
* The percentage of overlapping debt applicable is estimated using taxable market property values. Applicable
percentages were estimated by determining the portion of the county's taxable market value that is within the City's
boundaries and dividing it by the county's total taxable market value.
-135-
CITY OF SHOREWOOD, MINNESOTA
STATISTICAL SECTION (UNAUDITED)
LEGAL DEBT MARGIN INFORMATION
LAST TEN FISCAL YEARS
Total net debt applicable to the limit
as a percentage of debt limit
(0.4 %)
Note: Under state law, the City's outstanding general obligation debt should not exceed 3 percent of the market value of
taxable property. The percentage was;changed to 3 percent for fiscal year 2008, prior to that, the percentage was 2 percent.
By law, the general obligation debt subject to the limitation may be offset by amounts set aside for the extinguishment
of those obligations.
-136-
Fiscal Year
2001
2002
2003 2004
Debt limit
$ 15,137,178
$ 16,341,278 $
18,374,640 $ 20,745,830
Total net debt applicable to limit
(66,837)
(76,688)
(88,925) -
Legal debt margin
$ 15,204,015
$ 16,417,966 $
18,463,565 $ 20,745,830
Total net debt applicable to the limit
as a percentage of debt limit
(0.4 %)
Note: Under state law, the City's outstanding general obligation debt should not exceed 3 percent of the market value of
taxable property. The percentage was;changed to 3 percent for fiscal year 2008, prior to that, the percentage was 2 percent.
By law, the general obligation debt subject to the limitation may be offset by amounts set aside for the extinguishment
of those obligations.
-136-
Table 12
Fiscal Year
2005 2006 2007 2008 2009 2010
$ 23,543,186 $ 26,453,492 $ 29,602,408 $ 48,047,970 $ 49,674,588 $ 49,097,037
$ 23,543,186 $ 26,453,492 $ 29,602,408 $ 48,047,970 $ 49,674,588 $ 49,097,037
Legal Debt Margin Calculation forTisca Year 2010
Taxable market value $ 1,636,567,900
Debt limit (3% of market 'value) $ 49,097,037
Debt applicable to limit
General obligation bonds
Less: amount available in
debt sery ice funds
to limit
$ 49,097,037
-137-
Fiscal
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
(1)
(2)
Fiscal
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
Fiscal
Year
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
Including interest and other income
Excluding depreciation and interest on bonds
from
Interest Coverage
109,736
CITY OF SHOREWOOD, MINNESOTA
99,739
0.18
STATISTICAL
SECTION (UNAUDITED)
86,907
1.31
PLEDGED
- REVENUE COVERAGE
79,456
2.94
LAST
TEN FISCAL YEARS
172,050
1.37
142,589
General Obligation Revenue Bonds
(1)
1.23
Net
29,842
Gross
(2)
Revenue
Debt Service
Revenue
Expenses
Available Principal
69,594
$ 398,555
$ 209,332
$ 189,223 $
185,000 $
287,465
236,575
50,890
185,000
539,287
192,689
346,598
185,000
676,287
314,513
361,774
190,000
720,438
300,858
419,580
950,000
1,264,892
223,243
1,041,649
275,000
765,717
259,056
506,661 '
255,000 ,
857,890
278,164
579,726
250,000 '
821,778
250,995
570,783
250,000 `
700,678
238,780
461,898
250.000
Including interest and other income
Excluding depreciation and interest on bonds
from
Interest Coverage
109,736
0.64
99,739
0.18
93,280
1.25
86,907
1.31
88,712
0.40
79,456
2.94
81,165
1.51
172,050
1.37
142,589
1.45
1.25,407 ;:
1.23
faxes
Principal
Interest
Coverage
__$.. 37,544
S 23,358
$ 14,186
1.00
37,544
'� 24,833
12,711
1.00
37,544
26,402
11,142
1.00 ,
;. 37,544
28,069
9,475
1.00
37
29,842
7,702
1.00
37.544
31,728
5,816
1.00
71406
69,594
3,812
1.00
Lease Revenue
Bonds
Revenue from
Lease
Debt Service
Payments
Principal
Interest
Coverage
447,704
-
447,704
1.00
620,596
-
624,650
0.99 ':...
948,384
355,000
588,384
1.01
1,040,693
455,000
589,056
1.00
1,034,751
465,000
941,222
0.74
1,037,241
485,000
970,065
0.71
992,835
495,000
737,863
0.81
982,037
280,000
219,746
1.97
-138-
Table 13
CITY OF SHOREWOOD, MINNESOTA Table 14
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN FISCAL YEARS
Percent of
population
Total Per Capita which has a
Fiscal Personal Personal Median bachelor's or post Unemployment
Year Population (1) Income (2) income (2) Age (3) graduate degree (4) Rate (5)
2001
7,540
$ 328,389,620
$ 43,553
38.7
55.0 % 3.5 %
2002
7,590
333,254,130
43,907
38.7
4.4
2003
7,595
344,387,680
45,344
38.7
4.7
2004
7,625
366,343,125
48,045
38.7
4.3
2005
7,551
374,272,866
49,566
38.7.
3.8
2006
7,499
371,695,434
49,566
38.7 '
3.3
2007
7,611
377,246,826
49,566
38.7
4.7
2008
7,917
430,882,725
54,425
39.0
7.3
2009
7,929
431,535,825
54,425
39.0
7.4
2010
7,307
429,651,600
58,800
3Q.1
5.1
Data Sources:
(1) Metropolitan Council
(2) Bureau of Economic Analysis
(3) US Census Bureau
(4) US Census Bureau 2000
(5) Minnesota Department of Employment
Note: Population, median age, and education level information are based on surveys conducted during the last quarter of the
calendar year. Personal income information is a total for the year. Unemployment rate information is an adjusted yearly
average. School enrollment is based on the census at the start of the school year.
139-
CITY OF SHOREWOO'D, MINNESOTA
PRINCIPAL EMPLOYERS
CURRENT YEAR AND NINE YEARS AGO (1)
Source: Minns
* Includes par
N/A - indicate
(1) Informatio
-140-
2010
Percentage
of Total City
Employer
Employees
Rank
Employment
Minnewashta Elementary School
102
1
N/A %
Cub Foods
98
2
N/A
Xcel Energy
35
3
N/A
Beacon Bank
34
4
N/A
Minnetonka County Club
30
5
N/A
City of Shorewood
29 *
6
N/A
Total
328
%
Source: Minns
* Includes par
N/A - indicate
(1) Informatio
-140-
Table 15
2001
Percentage
of Total City
Employees Rank Employment
N/A %
N/A
N/A
N/A
N/A
-141-
Function
CITY OF SHOREWOOD, MINNESOTA
FULL -TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION
LAST TEN FISCAL YEARS (1)
General government
Public works
Maintenance
Culture and recreation
Parks
Water
Sewer
Municipal Liquor
Total
13
13
6
6
13
5
1.5
1.5
1.5
1.5
3
2
38
29
Source: City of Shorewood
(1) Information prior to 2006 was not maintained by the City. The table will be
13
6
5
1.5
1.5
basis
Table 16
2009
2010
12
12
6
6
5
5
1.5
1.5
1.5
1.5
26
26
142-
CITY OF SHOREWOOD, MINNESOTA
Table 17
OPERATING INDICATORS BY FUNCTION
LAST TEN FISCAL YEARS (1)
Function
2006 2007
2008
2009
2010
Building /engineering
Permits issued
1,137 710
686
603
591
Public works
Street sweeping (hours)
1,000 1,614
1,500
1,550
1,400
Snowplowing (hours)
2,000 1,394
1,508
765
1,024
Equipment repair (hours)
2,080 2,080
2,080
2,080
1,280
Water
New connections
24 22
13
11
1
Water mains breaks
3 7
3
3
5
Average daily consumption (thousands of gallons)
482,000 482,000
482,000
467,600
Sewer
Average daily treatment flow (thousands of gallons)
1,000,000 1,000mo
1,000,000
1,000,000
1,000,000
Source: City of Shorewood
Note: Indicators are not available for the general government function,
(1) Information prior to 2006 was not maintained by the City. The table will be updated on a go-forward basis
-143-
CITY OF SHOREWOOD, MINNESOTA
CAPITAL, ASSET STATISTICS BY FUNCTION
LAST TEN FISCAL YEARS (1)
Function 2006 2007 2008
Public Works
Highways and streets
Streets (miles)
Street lights
Traffic signals
Culture and recreation
Parks division
Parks
Parks acreage
Baseball diamonds
Basketb
Bike tra
Hockey
Softball
Swimm
Tennis,
Volleyb
Utilities
Water
Mlles 01
Consurr
Maxims
Sewer
Miles of
Lift stat
Maximti
Storm sew
Miles of
Source: City
Note: No car
(1) Informati
2009
50
51
51
51
194
194
194
194
5
5
5
5
7
7
7
7
102
102
102
102
5
5
5
5
Table 18
2010
51
194
5
7
102
5
1
2.45
3
3
1
5
2
28
1,322
919,000
60
14
1,000,000
12
-144-
MEMORANDUM
Date: July 25, 2011
To: Mayor Lizee
Council Members
From: Bruce DeJong, Finance Director
Re: June, 2011 Monthly Budget Report
The 2011 General Fund budget is a challenge to describe at this point. Revenues look higher
than last year on at 52% of non - property tax revenues, but that is primarily because we lowered
the budget base that we are measuring against. Actual revenues are about $7,000 lower than last
year at this point. Overall expenditures are at 37.2% which is higher than previous years at this
point.
REVENUES
• We have received a 70% partial payment of the first half property taxes collected through
May 15 from Hennepin County.
• License and permit revenues continue to be up about $10,000 over last year. This may
indicate an increase in remodeling activity from the severely depressed levels of the past
couple of years, but Mr. Pazandak is not yet ready to proclaim that we will exceed budget
for the year.
• Intergovernmental revenues are typical for this point with the first half of the MSA funds
in from the state.
• Charges for services are running just under last year's level, but are on track to make
budget.
• Fines and forfeitures are about the same as previous years.
• Miscellaneous revenue is primarily interest earnings which continue to be extremely low
— especially given the negative economic news and outlook for the near future.
EXPENDITURES
• Council — looks about on track with previous years.
• Administration — slightly high on support and services because of the annual ICMA
membership dues of $805 paid in April
• General Government — looks about on track with previous years.
• Elections - looks about on track with previous years.
• Finance - over because annual software maintenance contract expenditures are one -time
expenses early in the year.
• Professional Services — a bit lower than previous years based on special projects.
• Municipal Buildings — high because the LMCIT liability insurance costs were paid early
in the year. Materials and supplies cover copier and Laserfiche software maintenance,
but some Warner Connect charges were miscoded and need to be reclassified as support
and services which will bring materials and supplies back below budget.
• Police and Fire always look high early in the year because payments are made in advance
of the service in order to cash flow their operations. They are tracking closely with
previous years.
• Public Works - over because more wages have been coded to this department based on
actual time spent — which should even out over the course of the year as street operations
begin. Staff will have an analysis to discuss at the budget work session.
• Snow and Ice - over because of all the snow received this winter. There is still a chance
that the overall budget will not be exceeded if snow fall this fall and early winter is
average or below.
• Tree Maintenance — city crews tackled some significant tree maintenance in city rights of
way with a rented bucket truck during April.
• Parks & Recreation is tracking closely with previous years.
Please contact me or Mr. Heck if you have any questions.
Attachment: June Monthly Budget Report
Monthly Budget Report
June 30, 2011
YTD
YTD
2011
% of 2011
Expected
2010
June
Adopted
Annual
% of 2011
Year to Date Overview
Actual
2011
Budget
Budget
Budget
REVENUE
Property Taxes
1
1
4
34.8%
35.0%
Licenses and Permits
67
88
98
90.3%
53.7%
Intergovernmental
32
34
69
49.1%
47.0%
Charges for Service
33
22
35
63.1%
61.3%
Fines and Forfeitures
22
20
52
39.2%
41.0%
Miscellaneous
43
15
63
24.5%
37.0%
Transfers from other funds
-
-
40
0.0%
0.0%
TOTAL
1,873,573
1,836,980
5,121,895
35.9%
180
318
56.8%
EXPENDITURES
Department
Council
Personnel
8
8
16
50.0%
49.0%
Materials and Supplies
550
619
1
47.6%
100.0%
Support and Services
19
32
102
32.0%
43.7%
Total
28
41
120
34.7%
Administration
Personnel
68
70
142
49.3%
54.0%
Materials and Supplies
-
-
-
0.0%
7.3%
Support and Services
1
3
4
65.0%
32.0%
Capital Outlay
1
-
-
21.7%
Total
71
73
147
49.8%
General Government
Personnel
95
118
226
52.5%
51.3%
Materials and Supplies
7
5
18
32.0%
38.3%
Support and Services
13
15
32
46.5%
34.3%
Capital Outlay
1
-
-
38.0%
Total
117
139
277
50.5%
Elections
Personnel
4
273
4
5.7%
10.7%
Materials and Supplies
2
1
2
72.4%
44.3%
Support and Services
108
-
-
30.3%
Capital Outlay
-
-
-
18.3%
Total
7
1
7
27.4%
Finance
Personnel
86
78
153
51.3%
46.7%
Materials and Supplies
6
6
6
100.2%
79.7%
Support and Services
1
7
6
109.8%
21.7%
Capital Outlay
-
-
-
12.3%
Total
95
92
166
55.7%
Professional Services
147
138
199
69.4%
85.0%
Monthly Budget Report
June 30, 2011
YTD YTD 2011 % of 2011 Expected
2010 June Adopted Annual % of 2011
Year to Date Overview Actual 2011 Budget Budget Budget
Planning and Zoning
125
142
184 77.2% 47.3%
Materials and Supplies
28
Personnel
83
80
170
47.0%
46.3%
Materials and Supplies
54
156
655
23.8%
98.3%
Support and Services
4
4
11
39.3%
52.3%
Capital Outlay
-
-
31.7%
Total
87
85
183
46.5%
Municipal Building - City Hall
Materials and Supplies
30
29
16
179.8%
45.7%
Support and Services
8
94
157
60.0%
9.7%
Capital Outlay
15
1
-
26.3%
Transfers
-
-
103
0.0%
0.0%
Total
55
125
278
45.1%
Police
Support Services
474
498
995
50.1%
53.3%
Capital (Public Safety Bldg)
114
115
230
50.0%
50.0%
Total
589
613
1
50.1%
Fire
Support Services
161
168
337
50.0%
51.7%
Capital (Public Safety Bldg)
136
135
270
50.0%
49.0%
Total
297
303
607
50.0%
Inspections
Personnel
53
55
109
51.3%
47.7%
Materials and Supplies
22
154
300
51.3%
5.0%
Support and Services
1
124
6
1.9%
25.7%
Total
55
56
116
48.5%
City Engineer
Personnel
41
47
111
43.0%
47.7%
Materials and Supplies
44
4
1
0.3%
28.7%
Support and Services
3
896
13
6.7%
18.7%
Capital Outlay
44
-
1
0.0%
35.7%
Total
44
48
126
38.5%
Public Works Service
Personnel
125
142
184 77.2% 47.3%
Materials and Supplies
28
39
71 55.8% 43.7%
Support and Services
24
23
41 56.8% 52.0%
Capital Outlay
-
-
- 0.0%
Total
178
205
296 69.2%
Monthly Budget Report
June 30, 2011
YTD YTD 2011 % of 2011 Expected
2010 June Adopted Annual % of 2011
Year to Date Overview Actual 2011 Budget Budget Budget
Streets and Roads
Personnel
43
39
113
34.9% 45.7%
Materials and Supplies
27
30
85
36.2% 31.3%
Support and Services
426
1
34
5.0% 11.3%
Capital Outlay
-
-
700
0.0% 0.0%
Total
72
72
932
7.7%
Snow and Ice
Personnel
26
41
56
73.1%
54.0%
Materials and Supplies
12
14
45
31.5%
34.7%
Total
39
55
101
54.6%
Traffic control / Street Lights
Materials and Supplies
146
2
5
44.3%
56.3%
Support and Services
16
23
52
45.5%
42.3%
Total
16
25
57
45.4%
Sanitation / Waste Control
Personnel
3
186
2
8.2%
100.0%
Materials and Supplies
-
-
100
0.0%
1.3%
Support and Services
3
3
4
85.0%
25.7%
Total
7
3
6
57.9%
Tree Maintenance
Personnel
9
9
14
66.8%
39.7%
Materials and Supplies
34
170
1
11.9%
5.3%
Support and Services
6
1
13
11.0%
31.7%
Total
15
10
28
38.3%
Parks and Recreation
Personnel
73
69
185
37.2%
50.7%
Materials and Supplies
7
12
19
63.2%
58.0%
Support and Services
46
44
91
48.6%
70.3%
Transfers
-
-
42
0.0%
0.0%
Total
127
126
339
37.2%
Unallocated
Total Expenditures
Net Revenue less Expenditure.c
- 51 - 0.0%
2 2 5,218,884 43.6%
(180,448) (436,127) (96,989)
Note: The balanced budget includes $150,000 of fund balance in the Transfers item of the Revenue section.
MEMORANDUM
Date: July 25, 2011
To: Mayor Lizee
Council Members
From: Bruce DeJong, Finance Director
Re: June, 2011 Quarterly Investment Report
The City's cash reserves have been invested in both cash flow type of investments to meet
ongoing expenditure needs and longer -term securities with higher returns than money market
funds. It is important to remember our investment priorities in order of concern:
1. Safety — preservation of principal;
2. Liquidity — having funds available when needed to pay expenses;
3. Yield — earning market rates of return for the amount of principal risk we are willing to
accept.
With the investments that the City currently holds, and with our philosophy of holding
investments to maturity, we are exposed to minimal risk of principal loss. The only expected
change is when investments are marked to market and gains or losses are recognized at year end.
In order to decide what time frames should be targeted for various investments, a cash flow
projection has been prepared. Over the past three years, the city has only had three months
where cash flow is positive — June, July, and December. Those months are when we receive tax
settlements. The rest of the months, need about $500,000 on average to cover operating costs.
This means that the City should have a mix of callable and non - callable investments with both
short-term cash flow needs being met and longer maturities targeting major cash needs over the
investment horizon.
The current investment climate has not changed much but may have slightly declined since
January. We are still finding investments in the four year and under time frame that return over
1.0 %. I am slowly finding investments to meet cash flow needs for the rest of the year in our
targeted months.
We have a significant amount of funds held in cash and money market because of the recent
property tax settlement. Finding short term investments with any reasonable yield has been a
challenge, which has forced us to keep more funds in money market funds than we need for
immediate cash flow.. Staff aims to invest these funds to increase the overall portfolio returns,
while maintain flexibility to cover ongoing expenditures as projected using a cash flow estimate.
Please contact me or Mr. Heck if you have any questions.
Attachment: June, 2011 Investment Summary
CITY OF SHOREWOOD
2010 INVESTMENT AND INTEREST SCHEDULE
JUNE 2011
TOTAL
Beg of Year MARKET PURCH MATURITY RECEIVED
INSTITUTION VALUE VALUE RATE DATE DATE YTD
Beacon Bank
Checking Account 100 -0643
562,500.57
0.00%
03/31/11
0.94
Money Market Acct 130 -0822
200,038.40
0.50%
03/31/11
336.56
TOTAL
762,538.97
337.50
4 -M FUND
Money Market Account
4,578.03
0.02%
03/31/11
30.48
TOTAL
4,578.03
30.48
STERNE AGEE
Carlton Co MN BABs
196,113.45
198,511.95
1.80%
12/29/10
02/01/14
0.00
Carlton Co MN BABs
185,542.05
187,266.25
1.35%
12/29/10
02/01/13
0.00
Carlton Co MN BABs
180,230.40
180,576.00
1.05%
12/29/10
02/01/12
0.00
Decatur IL BABs
387,979.80
391,345.50
1.75%
12/07/10
12/15/12
3,564.17
Dist of Columbia BABs
222,618.00
0.75%
03/31/11
06/01/12
IL State Pension
225,750.80
2.58%
03/31/11
06/01/13
Milwaukee Co WI Pension
546,790.00
1.75%
01/26/11
12/01/13
Pennsylvania School Bldg
537,268.40
Stratford CT Pension
252,052.50
FNMA
500,000.00
m
1.65%
12/30/10
06/30/14
4,125.00
FHLB
493,495.00
m
1.63%
12/30/10
12/30/15
4,062.50
FHLB
1,195,860.00
m
1.75%
12/30/10
12/30/15
10,500.00
FHLB
1,000,000.00
FHLB
500,000.00
TOTAL
3,139,220.70
4,242,179.40
22,251.67
WELLS FARGO INVESTMENTS
First Sec Bank Missoula MT
m
0.30%
03/10/11
181.23
Carolina 1st Bnk Greenville -CD
100,161.00
m
1.35%
09/12/13
03/11/11
669.45
Bank of China, NY - CD
49,008.13
m
0.55%
05/13/14
05/12/11
269.50
Columbus Bnk &Trust, GA -CD
144,974.33
m
0.45%
05/13/14
05/12/11
652.50
Bank Baroda, NY - CD
49,016.70
m
0.60%
05/15/14
05/13/11
293.19
Carolina 1st Bnk Greenville -CD
100,837.00
100,239.70
1.75%
09/12/13
09/12/11
867.81
Beal Bank Las Vegas NV
244,920.13
0.35%
10/12/11
Columbus Bnk &Trust, GA -CD
102,046.80
101,802.60
2.30%
09/17/13
09/17/12
1,140.55
KS Bnk Smithfield. NC -CD
102,463.00
102,526.30
0.03%
09/19/13
08/17/13
1,034.25
American Eagle Bnk, Elgin IL -CD
102,755.60
102,860.90
2.60%
09/19/13
09/18/13
1,075.61
MNSCU 2011 B Taxable
302,123.85
1.00%
02/23/11
10/01/13
FNMA
500,456.00
2.00%
01/21/11
01/21/15
Wells Fargo Money Market
697,246.16
0.01%
03/31/11
177.04
TOTAL
751,262.56
2,152,175.64
6,361.13
Page 1 of 2
CITY OF SHOREWOOD
2010 INVESTMENT AND INTEREST SCHEDULE
JUNE 2011
TOTAL
Beg of Year MARKET PURCH MATURITY RECEIVED
INSTITUTION VALUE VALUE RATE DATE DATE YTD
MORGAN STANLAY SMITH BARNEY)
GE Cap - Comm Paper 499,850.00
FNMA 200,948.00 m
FNMA 201,854.00 200,124.00
FHLB 1,000,310.00
402,802.00 1,200,434.00
Cole Taylor Bank, IL
Branch Bank & Trust CD
CIT Bank - UT CD
Bank of India, NY - CD
Bank of America, NC - CD
Bank of China, NY - CD
Bank of Baroda, NY - CD
Firstbank of Puerto Rico - C
Compass Bnk, AL - CD
Compass Bnk, AL - CD
Citibnk NA -NV CD
Citibnk NA -NV CD
Natl Bnk So. Carolina CD
Natl Bnk So. Carolina CD
Wright Express Fin -UT CD
Wright Express Fin -UT CD
Compass Bnk, AL - CD
Amer Exp Bnk, FSB - CD
Amer Exp Bnk, FSB - CD
Amer Exp Centurion Bnk- C
Amer Exp Centurion Bnk- C
GE Capital Fin, UT - CD
GE Capital Fin, UT - CD
GE Capital Fin, UT - CD
Capmark Bnk, UT - CD
Capmark Bnk, UT - CD
CIT Bnk, UT - CD
CIT Bnk, UT - CD
96,239.04
m
96,370.56
m
96,404.16
m
199,926.00
m
199,890.00
m
199,890.00
m
199,924.00
m
D 200,074.00
m
96,689.28
m
54,387.72
m
241, 545.60
241, 053.60
8,051.52
8,035.12
240,835.20
241,243.20
8,027.84
8,041.44
240,230.40
240,916.80
8,007.68
8,030.56
96,065.28
96,464.64
97,771.20
97,320.96
54,996.30
54,743.04
D 97,771.20
97,320.96
D 54,996.30
54,743.04
99,494.40
98,928.00
99,494.40
98,928.00
54,929.20
54,616.50
99,016.32
99,531.84
55,696.68
55,986.66
99,016.32
99,531.84
55,696.68
55,986.66
3,151,437.28
1,711,422.86
Money Market Fund
3,519,188.49
TOTAL 3,554,239.28 6,930,895.35
0.20% 03/29/11 09/26/11
2.38%
03/18/09
04/01/14
2,375.00
2.00%
06/24/09
07/15/14
0.00
1.13%
03/28/11
10/14/15
0.00
0.06
116,122.00
121,470.00
2,375.00
4.35%
01/31/12
01/28/11
2,082.28
2.25%
03/26/13
03/25/11
1,071.12
2.40%
03/26/13
03/25/11
1,142.53
0.60%
05/14/14
05/11/11
1,193.42
0.55%
05/13/14
05/12/11
1,100.00
0.55%
05/13/14
05/12/11
1,100.00
0.60%
05/15/14
05/13/11
1,196.72
0.80%
05/15/14
05/13/11
657.53
2.15%
07/01/13
06/30/11
0.00
2.15%
07/01/13
06/30/11
1,608.08
1.50%
12/31/13
12/30/11
0.00
1.50%
12/31/13
12/30/11
1,854.90
1.60%
01/09/14
01/09/12
2,000.31
1.60%
01/09/14
01/09/12
0.00
1.35%
01/09/14
01/09/12
1,687.76
1.35%
01/09/14
01/09/12
0.00
1.30%
05/15/14
05/14/12
618.87
2.60%
07/02/13
07/02/12
1,966.03
2.60%
07/02/13
07/02/12
0.00
2.60%
07/02/13
07/02/12
1,966.03
2.60%
07/02/13
07/02/12
0.00
3.05%
06/26/13
06/25/13
0.00
3.05%
06/26/13
06/25/13
0.00
3.05%
06/26/13
06/25/13
3,726.01
3.35%
07/02/13
07/01/13
2,533.15
3.35%
07/02/13
07/01/13
0.00
3.35%
07/02/13
07/01/13
2,533.15
3.35%
07/02/13
07/01/13
0.00
30,037.89
0.02%
03/31/11
1,033.99
33,446.88
GRAND 4,329,926.15 14,092,367.39 0.00 0.00 0.00 62,427.66
Page 2 of 2