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2002 - Comp. Annual Financial Report I I I I I -I I I I I I I I I I I I I I CITY OF SHOREWOOD SHOREWOOD, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2002 I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31,2002 CRAIG DAWSON, CITY ADMINISTRATOR REPORT PREPARED BY BONNIE BURTON, FINANCE DIRECTOR/TREASURER MEMBER OF GOVERNMENT FINANCE OFFICERS ASSOCIATION OF THE UNITED STATES AND CANADA I CITY OF SHOREWOOD, MINNESOTA I TABLE OF CONTENTS DECEMBER 31,2002 Exhibit Page No. I 1. INTRODUCTORY SECTION I Elected and Appointed Officials Organizational Chart Letter of Transmittal I - VI I Certificate of Achievement for Excellence in Financial Reporting II. FINANCIAL SECTION I Independent Auditor's Report 2 General Purpose Financial Statements I Combined Balance Sheet - All Fund Types and Account Groups 3-4 Combined Statement of Revenue, Expenditures and Changes in Fund Balance (Deficit) - All Governmental Fund Types 2 5-6 I Statement of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual - General Fund 3 7 Combined Statement of Revenue, Expenses and Changes in Retained Earnings - I All Proprietary Fund Types 4 8 Combined Statement of Cash Flows - All Proprietary Fund Types 5 9 Notes to Financial Statements 10 - 26 I Combining and Individual Fund and Account Group Financial Statements and Schedules General Fund I Comparative Balance Sheets A-I 27 Statement of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual A-2 28 - 32 I Debt Service Funds Combining Balance Sheet B-1 33 - 34 Combining Statement of Revenue, Expenditures and Changes in Fund Balance (Deficit) B-2 35 - 36 I Capital Projects Funds Combining Balance Sheet C-l 37 - 38 I Combining Statement of Revenue, Expenditures and Changes in Fund Balance C-2 39 - 40 Enterprise Funds Combining Balance Sheet D-l 41 - 42 I Combining Statement of Revenue, Expenses and Changes in Retained Earnings D-2 43 - 44 Combining Statement of Cash Flows D-3 45 - 46 I Water Fund Comparative Balance Sheets D-4 47 Comparative Statements of Revenue, Expenses and Changes in Retained Earnings D-5 48 Comparative Statements of Cash Flows D-6 49 I Sewer Fund Comparative Balance Sheets D-7 50 I Comparative Statements of Revenue, Expenses and Changes in Retained Earnings D-8 51 Comparative Statements of Cash Flows D-9 52 I I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA TABLEOFCONTENTS-CONT~ED DECEMBER 31, 2002 Exhibit Page No. Combining and Individual Fund and Account Group Financial Statements and Schedules - Continued Recycling Fund Comparative Balance Sheets Comparative Statements of Revenue, Expenses and Changes in Retained Earnings Comparative Statements of Cash Flows Stormwater Management Utility Fund Comparative Balance Sheets Comparative Statements of Revenue, Expenses and Changes in Retained Earnings Comparative Statements of Cash Flows Liquor Fund Comparative Balance Sheets Comparative Statements of Revenue, Expenses and Changes in Retained Earnings Comparative Statements of Cash Flows Combining Balance Sheets Combining Schedules of Revenue, Expenses and Changes in Retained Earnings (Deficit) Combining Schedules of Cash Flows General Fixed Asset Account Group Comparative Schedules of General Fixed Assets - by Source Schedule of General Fixed Assets - by Function and Activity Schedule of Changes in General Fixed Assets - by Function General Long-term Debt Account Group Comparative Statements of General Long-term Debt Schedule of Bonds Payable Schedule of Debt Service Requirements III. STATISTICAL SECTION (UNAUDITED) General Fund Expenditures and Other Uses by Function General Fund Revenue and Other Sources by Source Property Tax Levies and Collections Assessed Valuation, Tax Levies and Mill Rates Property Tax Capacity Rates - Direct and Overlapping Governments Principal Taxpayers Special Assessment Levies and Collections Computation of Legal Debt Margin Ratio of Net Bonded Debt to Assessed Value and Net Bonded Debt per Capita Ratio of Annual Debt Service Expenditures for General Bonded Debt to Total General Expenditures Computation of Direct and Overlapping Debt Revenue Bond Coverage Property Value and Construction Miscellaneous Statistics D-lO 53 D-ll 54 D-12 55 D-13 56 D-14 57 D-15 58 D-16 59 D-17 60 D-18 61 D-19 62 - 63 D-20 64 - 65 D-21 66 - 67 E-l 68 E-2 69 E-3 70 F-1 71 F-2 72 - 73 F-3 74 - 75 Table 1 76 2 77 3 78 4 79 - 80 5 81 - 82 6 83 7 84 8 85 9 86 10 87 11 88 12 89 13 90 14 91 I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA SECTION I INTRODUCTORY SECTION I CITY OF SHOREWOOD, MINNESOTA I ELECTED AND APPOINTED OFFICIALS DECEMBER 31, 2002 I Term Expires ELECTED OFFICIALS I Woody Love Mayor 2004 Christine Lizee Council Member 2004 I Scott Zerby Council Member 2004 John Garfunkel Council Member 2004 Laura Turgeon Council Member 2004 I APPOINTED OFFICIALS I Craig Dawson City Administrator Bonnie Burton Finance Director/Treasurer I I I I I I I I I I I I -1- - - Personnel Accounting Payroll Investments Utility Billing Accts. Payable Accts. Receivable Special Assessments Budgeting MIS Purchasing - - - - - Off-Sale Retail - - - - - - CITY OF SHOREWOOD, MINNESOTA ORGANIZATION CHART CITY COUNCIL RECEPTIONIST/ PARK SECRETARY COMMUNICATIONS TECHNICIAN General Government Licensing Elections Records Legal Publications Public Information Recreation Programs Cable TV Franchise CONTRACTED SERVICES ASSESSOR-HENNEPIN COUNTY RECYCLING--EZ RECYCLING UTILmES MUNITECH ANIMAL CONTROL--CITY OF ORONO ANIMAL IMPOUND--PA WS, CLAWS & HOOVES FIRE (Islands)---MOUND ADVISORY BOARDS PARK COMMISSION PLANNING COMMISSION LAND CONSERVATION & ENVIRONMENT COMMITTEE (LCEC) CITY ATTORNEY Planning Zoning Administration Property Records Inspection - - - POLICE - SLMPD FIRE - EXCELSIOR FIRE DISTRICT LMCC - Lake Minnetonka Communications Commission LMCD - Lake MiDDetonka Conservation District P.W. DIRECTOR! CITY ENGINEER LIGHT EQUIPMENT OPERATORS Building and Grounds Tree Maintenance Park Maintenance Street Maintenance Equipment Maintenance Stormwater System Street Lighting SanitationIWeeds Janitor Services (Contract) Utility Maintenance (Contract) Park Planning (Contract) - - - ENGINEERING ADMIN. ASST. Engineering Services Project Mgmt I CITY OF SHOREWOOD I I I . 5755 COUNTRY CLUB ROAD · SHOREWOOD, MINNESOTA 55331-8927 · (952) 474-3236 FAX (952) 474-0128. www.ci.shorewood.mn.us. cityhall@ci.shorewood.mn.us I I I I I I I May 25, 2003 Honorable Mayor and Members of the City Council City of Shorewood, Minnesota We are herewith submitting the C6mprehensive Annual Financial R~port of the City of Shorewood, Minnesota, for the fiscal year ended December 31, 2002. The City is responsible for the accuracy of the data, and the completeness and fairness of the presentation, including all disclosures. To the best of our knowledge and belief, the enclosed data are accurate in all material respects and are reported in a manner designed to present fairly the financial position and results of operations of the various funds and account groups of the City. All disclosures necessary to enable the reader to gain an understanding of the City's financial activities have been included. I The Comprehensive Annual Financial Report is presented in three sections: Introductory, Financial and Statistical. The Introductory section includes this transmittal letter, the City's organizational chart and a list of City officials. The Financial section includes the general-purpose financial statements and the combining and individual fund and account group financial statements and schedules, along with the auditor's report on the financial statements. The Statistical section includes financial and demographic information, generally presented on a multi-year basis. I I The organization, form, and contents of this report were prepared in accordance with the standards prescribed by the Governmental Accounting Standards Board, the Government Finance Officers Association of the United States and Canada, the American Institute of Certified Public Accountants, ang the Minnesota State Auditor's Office. I This report includes all funds and account groups of the City. The fund types included. are governmental and proprietary. Within the account groups are/ general fixed assets and general long-term debt. The City provides its residents and businesses with a full range of municipal services conSIsting of police, fire, public works, parks and general administrative serVices. The qty also operates five enterprises: a water utility, sewer utility, recycling utility, stormwater management utility, and. an off-sale liquor operation with three store locations during 2002. I I The Economic Development authority (EDA) of the City was created pursuant to Minnesota Statutes 469.090 through 469.108 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 reported in .a separate special revenue fund. Separate financial statements are not issued for this component unit. I I #. I ~J PRINTED ON RECYCLED PAPER I I I I I ECONOMIC CONDITION AND OUTLOOK The City of Shorewood is a suburb of the City of Minneapolis and is located 25 miles southwest of the central business district on the southern shore of Lake Minnetonka. The City is predominantly a residential community with limited commercial businesses and two commercial shopping malls. The City is 6 square miles in area and had an estimated population of 7,540 as of 2002. While the City experienced an accelerated rate of growth in residential development during the 1980's, the growth rate slowed during the 1990's. The City, which is currently 95% developed, will continue to experience growth in its residential base in. the future but because of the limited availability of large tracts of land, this growth will come at a reduced rate and will be much smaller developments than in the past. FINANCIAL AND MANAGEMENT EMPHASIS I Emphasis on Governance The City CouncH, in its leadership role, has effectively established a fOGuS for City government in Shorewood. The Council has committed to a strong set of values by which decisions are to be made. It has adopted a Statement of Purpose and has established overall goals and .expectationsfor the City. It has identified issues facing the City and prioritized them so that the staff can efficiently and effectively allocate time and resources. I I The City Council's calendar consists of three phases. The first phase is Planning: it includes review of the previous year's work plan and the City's Comprehensive Plan. It also includes identification and prioritization of goals and objectives for the next twelve months: I I I I I I I I I I I The second phase is that of Programming and Capital Finance Planning: each year the five-year Capital Improvement Program is reviewed and updated based upon priorities established in the first phase. Any cha~ges to the Comprehensive Plan are made based upon the Phase One decisions. The third phase is budgeting: the operating budget is developed based on decisions made in the first two phases. A budget format is used which provides information and.analytical data to the City Council and other readers. It defines departmental missions and sets objectives for the budget year. It also measures services provided and identifies the net effect each departmental budget has on property taxes. Emphllsis on System Improvements , The City continues to improve its communications through the Communications Program. This program includes: monthly distribution of the city newsletter; emphasis on informal information meetings; the City web page with appropriate and relevant links; promotion of public usage of the "Shoreline" phone message line; and a voice mail information system available to residents 24 hours a day with information about city services and events. Emphasis on Public Improvements and Programs The City Council established a Land Conservation and Environment Committee (LCEC) in 1999. The committee was created for a 3-year period to study and to make recommendations regarding ongoing land conservation and environmental policies for the City. Significant progress was made toward completing updates to the Comprehensive Plan and a Stormwatet Management Plan. The LCEC final report waS cOUlpleted and recommendations accepted by the City Council in 2003. The Park Commission continued its work on the. Park Master Plan. The Park Master Plan process is. a detailed review: and analysis of the amenities and attributes of each of the. ShorewoodCity parks. It will be included in its entirety in the City's Comprehensive Plan. In addition, the City began a comprehensive community visioning study, with written and telephone surveys, and a series of focus group meetings and visioning work-sessions to identify cOdperative II I I I I I I opportunities with other Lake Minnetonka communities. The vIsIOning process in 2001 and 2002 included public open meetings and citizen involvement in the planning and visioning process: The visioning study was completed in 2002 and received by the City Council in 2003. The next step is cooperative implementation by the South Lake Minnetonka Area cities. Emphasis on Efficiently, Effectively Meeting Service Needs Shorewood is committed to working cooperatively with area governmental jurisdictions to carefully consider optional methods to effectively deliver public services as efficiently as possible. The 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 employee training, sub- regional housing planning; animal control, disaster preparedness and other areas of mutual concern as an active participant in the Lake Minnetonka Area Cooperating Cities group. The Lake Minnetonkaarea cities continue to work to address mutual problems. I I I I The City, along with the cities of Excelsior, Deephaven, GreenwoOd and Tonka Bay, established the Excelsior Fire District in 2000, a joint powers organization to replace the previous contractual arrangement with the City of Excelsior Fire Department. The Excelsior Fire District has worked to develop appropriate facilities which will best serve the cities far into the future. To this end, the Excelsior Fire District purchased a 7-acre tract of land in Shorewood in 2001. A combined police and fire campus that will serve the Lake Minnetonka Area cities is currently in the construction phase and is scheduled for completion by late 2003. A fire station to serve the east side of the Excelsior Fire District is also planned for consttllction in 2003. The City has also been a member city of the South Lake Minnetonka Police Department (SLMPD) since its inception in 1973. The other members of this joiht powers organization are the cities of Excelsior, Greenwood, and Tonka Bay. The new police station will be completed at the end of 2003. FINANCIAL INFORMATION I I I I I I I I I INTERNAL CONTROLS City management staff is responsible for establishing and maintaining an internal control structure within the accounting system that is designed to ensure that the assets of the City are protected from loss, theft, or misuse, and to ensure that fair, reliable and accurate accounting data is compiled to allow for the preparation of financial statements in conformity with generally accepted accounting principles. The internal control structure is designed to vrovide reasonable,. but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that: 1) the cost of a control should not exceed the benefits; 2) the valuation of costs and benefits requires estimates and judgments by management. As part of the City's annual audit, the internal control system is evaluated to the extent necessary for audit purposes and changes are recommended when needed. BUDGETING CONTROLS The City maintains budgetary controls to ensure compliance with legal provisions emb<Xlied in the annual approprhlted budget approved by the City Council. The annual appropriated budget also includes the General Fund activities. The legal level of budgetary control is established at the department level, but management control is exercised at the line item level. The City continues meeting its responsibility for sdund financial management, as demonstrated by the. statements and schedules included in the financial section of this report GENERAL GO~ERNMENT FUNCTIONS The following schedule presents a summary of General Fund revenues for the fiscal year ended December 31,2002, and the amount of increases or decreases in relation to the prioryear's revenues. III I I I I I I I .1 I I I I I I I I I I I Revenues and Other Financing Sources General Property Taxes Licenses and Permits Intergovernmental Charges for Services Fines and Forfeitures Interest on Investments Miscellaneous Operating Transfers In Total Amount $ 2,658,663 229,234 171,783 46,079 89,632 114,832 319,910 55,000 $ 3,685,133 Percent of Total 72.15% 6.22 4.66 1.25 2.43 3.12 8.68 1.49 100.00% Change from 2001 $ 452,138 (120,281) (325,486) 3,857 28,389 (7,399) 281,139 25,000 $ 337.357 Overall revenues increased by $337,357 from 2001 to 2002. The largest increase in revenue was property tax revenues. . In addition, there was a large increase in the miscellaneous category resulting from a donation of land with an appraised value of $285,000 to the City. Interest revenue decreased in 2002 due to a general reduction in market interest rates. In addition, market value adjustments were made to the city's investments in accordance with GASB 31. Intergovernmental revenue decreased substantially from 2001 due to legislative changes that reduced or eliminated Homestead Aid Credit (HACA) payments to Minnesota Cities, and there was a decrease in license and permit revenue due to decreased building permit activity. . The following table presents a summary of General Fund expend,itures for the . fiscal year ended December 31, 2002, and the amount of increases or decreases in relation to the prior year's expenditures. Expenditures and Other Uses Current: General Government Public Safety Public Works Parks and Recreation Debt Service Capital Outlay: Operating Transfers Out: Total Amount $ 1,001,921 1,008,792 428,530 160,115 37,544 304,221 609,100 $ 3.550.223 Percent of Total 28.22% 28.41 12.07 4.51 1.06 8.57 17.16 100.00% Change from 2001 $ 20,775 115,722 (58,562) 33,976 o 289,325 75,100 $ 476.336 Ov~rall expenditures were higher in 2002 from 2001. Public Safety expenditures for police and fire services increased in 2002 primarily due to personnel adjustments and a change in the cost allocation formula for police services amongst the cities within the joint powers district. Spending in the general government category increased by an inflationary amount Of about 3%. The largest item of variance in expenditures was in. capital outlay which resulted from the accounting entry necessary to record the acquisition ofdonateo land to the City. The City Council has continued its plan to accumulate resources for future capital equipment and improvement projects. These amounts were transferred to various capital project funds to be applied to future and past equipment acquisitions and capital improvements. Budgeted transfers for capital improvel11ent purposes increased during 2002 from $534,000 to $609,100. GENERAL FUND BALANCE The General Fund balance at December 31, 2002, was $2,157,979 with $44,994 reserved for 2003 expenditures. The fund balance increased by $134,910 during 2002. The remaining fund balance is IV I I I I I I designated for working capital requirements through the first six months of the year. The unreserved fund balance is now 57% of the current year budget and the policy of the City is to maintain a fund balance at 40% to 60% of the current budget. It is important for the City to maintain adequate fund balance as a reserve to meet expenditures in the General fund until property tax proceeds are received in July. The City Council will continue to manage the fund balance at this level. ENTERPRISE OPERATION The City's enterprise fund activities for 2002 are summarized as follows: I I I I I I I I I I I I I Operating Operating Operating Revenues Expenses Income(Loss) Water: $287,465 $417,380 ($129,915) Sewer: 698,452 669,238 29,214 Recycling: 81,860 104,708 (22,848) Stormwater Management: 43,985 18,161 25,824 Liquor: Tonka Bay 188,189 147,891 40,298 Waterford Center 216,621 205,457 11,164 Sl1orewood Plaza 272,529 200,597 71,932 Generally accepted accounting principles require the depreciation of contributed assets, which results in net losses in some cases. However, past practice has not included the recovery of such depreciation in the setting of utility rates; The City's utility rate setting is done with reference to the working capital of the fund and assumes continued customer contributions through new connections. It is important to review the operations annually to ensure rates are sufficient to cover increased costs, and the City Council has considered and authorized rate changes for 2003. The Liquor Fund again experienced a substantial net operating profit in 2002. The average gross profit margins are above the state-wide average as reported by the Minnesota Office of the State Auditor. The Liquor Committee and City management continue to explore ways to increase future profit margins. DEBT ADMINISTRATION As of December 31, 2002, the City's debt outstanding totaled $11,905,635. Of this total, $9,950,000 is Lease Revenue Bonds issued in 2002 by the City of Shorewood Economic Development Authority (EDA) to finance the construction of Public Safety (police and fire) buildings. General obligation special assessment bonds for the construction of sanitary sewer, street, water and storm sewer improvements total..$40,000 and the. City has a capital lease to finance its portion of construction of the Southshore Senior Community Center in the amount of $185,635. Total outstanding general obligation water revenue bonds at year-end are $1,730,000. The proceeds from these bonds financed water system extensions and improvements and will be repaid from special assessments and Water Fund revenues. The City's bond rating is "AI" on general obligation bond issues, as rated by Moody's Investor Service. Moody's cited the following reasons for this rating: the development and implementation of a five-year capital improvement plan; low outstanding debt; sound financial . management; and anticipated maintenance of low debt ratios. CASH MANAGEMENT The City of Shorewood subscribes to the "pooled cash" concept of investing which means that all funds with cash balances participate in an investment pool. This permits some funds to be overdrawn and other funds to show positive. cash balances, with the City overall maintaining a positive cash balance. This . pooled cash concept pro~ides for investing of greater amounts of money at more favorable rates. Interest v I I I I I I earnings are then allocated to the participating funds. During 2002, the City of Shorewood earned $473,094 in interest revenue. RISK MANAGEMENT The City of Shorewood's worker's compensation insurance and its general property and liability coverage are provided through the League of Minnesota Cities Insurance Trust (LMCIT). The LMCIT worker's compensation program is a joint self-insurance plan designed to lower and. stabilize cities worker's compensation costs and to assure that cities have a source of coverage available. Each participating city deposits with the LMCIT its worker's compensation deposit premium for the policy year. The deposit premium is calculated using standard manual rates with applicable discount~ and experience modification factors. From these deposits, LMCIT purchases reinsurance to protect the program from catastrophic and abnormal payment claims. The balance of the deposits and reserves are invested, with the earnings accruing to the benefit of all participants. The LMCIT reserves and rates are reviewed annually by an actuary to help assure that the program remains financially strong. I I I I I I I I I I I I I OTHER INFORMATION INDEPENDENT AUDIT Minnesota State Statutes require an annual audit of the City's accounts by the Minnesota State Auditor or by independent certified public accountants. The auditor's report on the general-pJ.lI'Pose financial statements and schedules is included in the financial section of this report. CERTIFICATE OF ACHIEVEMENT FOR EXCELLENCE IN FINANCIAL REPORTING The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Shorewood for its comprehensive annual financial report for the fiscal year ended December 31, 2001. To receive the Certificate of Achievement award, a governmental unit must publish an easily readable and efficiently organized comprehensive annual financial report, This report must satisfy both generally accepted accounting principles and applicable legal requirements. Only 259 municipalities (less than 1 %), out of 32,000 municipalities nationwide with populations under 10,000, qualified to receive this award from the Government Finance Officers Association of the United States and Canada (GFOA). A Certificate of Achievement is valid for a period of one year only. We believe our current comprehensive annual financial report continues to meet the Certificate of Achievement Program's requirements and we are submitting it to the GFOA to determine its eligibility for another certificate. ACKNOWLEDGMENTS It is important to express appreciation and acknowledge the efforts of the City administrative staff, finance department staff, and the City's independent auditor. Their assistance and cooperation are so important to the timely preparation{)f the Comprehensive Annual Financial Report. Thank you als9, to Shorewood's Mayor and entire City Council for their cqntinued support of the highest standards of professionalism in the management of the City of Shorewood' s finances. Respectfully submitted, ~~ Bonnie Burton Finance Director/Treasurer VI I I I I I I I I I I I I I I I I I I I Certificate of Achievelllent for Excellence in Financial Reporting Presented to City of Shorewood, Minnesota For its Comprehensive Annual Financial Report for the Fiscal Year Ended December 31, 2001 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting. ~~~~ .. President ~/~ Executive Director I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA SECTION II FINANCIAL SECTION I I I I I I I I I I I I I I I I I I I Grandview Square 5201 Eden Avenue Suite 370 Edina, MN 55436 INDEPENDENT AUDITOR'S REPORT Honorable Mayor and City Council City of Shorewood, Minnesota We have audited the accompanying general purpose financial statements of the City of Shorewood, Minnesota, as of and for the year ended December 31,2002, as listed in the table of contents. These general purpose [mancial statements are the responsibility of the City's management. Our responsibility is to express an opinion on these general purpose [mancial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose [mancial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose [mancial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall general purpose [mancial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the general purpose [mancial statements referred to above present fairly, in all material respects, the financial position of the City as of December 31, 2002, and the results of its operations and the cash flows of its proprietary fund type for the year then ended in conformity with accounting principles generally accepted in the United States of America. Our audit was performed for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The combining, individual fund and account group fmancial statements, schedules and statistical information listed in the table of contents are presented for the purpose of additional analysis and are not a required part of the general purpose [mancial statements of the City. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, except for the statistical data section marked "unaudited" on which we express no opinion, is fairly stated in all material respects in relation to the general purpose [mancial statements taken as a whole. April 10, 2003 Minneapolis, Minnesota OJ;rkJf0t.. ~~J Llf ABDO, EICK & MEyKRS, LLP Certified Public Accountants 952.835.9090 Fax 952.835.3261 www.aemcpas.com I I I I I I CITY OF SHOREWOOD, MINNESOTA I GENERAL PURPOSE FINANCIAL STATEMENTS I The general purpose [mancial statements and notes to the [mancial statements are intended to provide an overview and broad perspective of the City's [mancial position and operations. These statements present a summary set of information needed to control and analyze current operations to determine compliance with legal and budgetary limitations and to assist in [mancial planning. I The following general purpose financial statements are presented: I Combined Balance Sheet - All Fund Types and Account Groups Combined Statement of Revenue, Expenditures and Changes in Fund Balance - All Governmental Fund Types I Statement of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual - General Fund Combined Statement of Revenue, Expenses and Changes in Retained Earnings - All Proprietary Fund Types I Combined Statement of Cash Flows - All Proprietary Fund Types I I I I I I I I CITY OF SHOREWOOD, MINNESOTA COMBINED BALANCE SHEET I ALL FUND TYPES AND ACCOUNT GROUPS DECEMBER 31, 2002 (With comparative totals for December 31, 200 I) I Governmental Fund Types Special Debt Capital I General Revenue Service Projects ASSETS AND OTHER DEBITS ASSETS I Cash and temporary investments $ 2,161,617 $ $ 207,489 $ 10,684,999 Receivables Accrued interest 17,296 1,312 15,145 I Delinquent taxes 59,575 Accounts 33,700 42,085 Special assessments 21,603 27,048 I Lease 9,950,000 Note Due from other funds 40,000 Inventories, at cost I Prepaid items 44,994 Bond discount, net Fixed assets, net I OTHER DEBITS Amount available for debt retirement Amounts to be provided for debt retirement TOTAL ASSETS AND OTHER DEBITS $ 2,338,785 $ $ 10,225,849 $ 10,742,229 I LIABILITIES, EQUITY AND OTHER CREDITS LIABILITIES Accounts and contracts payable $ 116,623 $ $ $ 660,411 I Due to other funds 40,000 Due to other governments 2,821 Accrued interest payable I Salaries and compensated absences payable 7,338 Escrow deposits payable Deferred revenue 54,024 9,977,048 General obligation bonds payable I General obligation revenue bonds payable Capital lease payable TOTAL LIABILITIES 180,806 10,017,048 660,411 I EQUITY AND OTHER CREDITS Investment in general fixed assets Contributed capital I Retained earnings Unreserved Fund balance (deficit) I Reserved 44,994 246,283 Unreserved Designated 2,112,985 10,081,818 I Undesignated (37,482) TOTAL EQUITY AND OTHER CREDITS 2,157,979 208,801 10,081,818 TOTAL LIABILITIES, EQUITY I AND OTHER CREDITS $ 2,338,785 $ $ 10,225,849 $ 10,742,229 See Notes to Financial Statements. -3- I I CITY OF SHOREWOOD, MINNESOTA COMBINED STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE (DEFICIT) I ALL GOVERNMENTAL FUND TYPES YEAR ENDED DECEMBER 31, 2002 (With comparative totals for the year ended December 31, 2001) I Special Debt Capital 'I General Revenue Service Proj ects REVENUE Taxes $ 2,658,663 $ $ $ I Licenses and permits 229,234 Intergovernmental 171,783 Charges for services 46,079 I Fines and forfeitures 89,632 Special assessments 7,844 1,391 Interest on investments 114,832 42,986 125,206 I Miscellaneous 319,910 55,600 TOTAL REVENUE 3,630,133 50,830 182,197 EXPENDITURES I Current General government 1,001,921 I Public safety 1,008,792 Public works 428,530 Culture and recreation 160,115 Capital outlay 304,221 3,128,801 I Debt service Principal 24,833 115,000 Interest and service charges 12,711 6,133 I TOTAL EXPENDITURES 2,941,123 121,133 3,128,801 EXCESS (DEFICIENCY) OF REVENUE I OVER EXPENDITURES 689,010 (70,303) (2,946,604) OTHER FINANCING SOURCES (USES) I Operating transfers in 55,000 574,100 Proceeds from sale of bonds 47,683 9,902,317 Operating transfers out (609,100) I TOTAL OTHER FINANCING SOURCES (USES) (554,100) 47,683 10,476,417 EXCESS (DEFICIENCY) OF REVENUE AND OTHER I FINANCING SOURCES OVER EXPENDITURES AND OTHER FINANCING USES 134,910 (22,620) 7,529,813 FUND BALANCE (DEFICIT), JANUARY 1 2,023,069 (8,342) 231,421 2,560,347 I RESIDUAL EQUITY TRANSFER IN 8,342 RESIDUAL EQUITY TRANSFER OUT (8,342) I FUND BALANCE, DECEMBER 31 $ 2,157,979 $ $ 208,801 $ 10,081,818 I See Notes to Financial Statements. -5- I I Exhibit 2 I I Totals I (Memorandum Only) 2002 2001 I $ 2,658,663 $ 2,206,525 229,234 349,515 171,783 3,104,043 I 46,079 42,222 89,632 61,243 9,235 52,485 I 283,024 225,500 375,510 71,236 3,863,160 6,112,769 I I 1,001,921 989,502 1,008,792 893,070 428,530 487,092 160,115 126,139 I 3,433,022 2,164,146 139,833 148,358 I 18,844 27,016 6,191,057 4,835,323 I (2,327,897) 1,277,446 I 629,100 554,000 9,950,000 I (609,100) (539,000) 9,970,000 15,000 I 7,642,103 1,292,446 I 4,806,495 3,514,049 8,342 I (8,342) $ 12,448,598 $ 4,806,495 I I -6- I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA Exhibit 4 COMBINED STATEMENT OF REVENUE, EXPENSES AND CHANGES IN RETAINED EARNINGS ALL PROPRIETARY FUND TYPES YEAR ENDED DECEMBER 31, 2002 Enterprise OPERATING REVENUE Sales $ 2,507,191 Less cost of sales (1,829,852) GROSS PROFIT 677,339 Charges for services 1,086,870 Permits and connection fees 24,892 TOTAL OPERATING REVENUE 1,789,101 OPERATING EXPENSES Personal services 377,780 Supplies 37,834 Repairs and maintenance 29,726 Depreciation 397,557 Professional services 11,930 Contracted services 240,447 Communication 1,551 Insurance 19,239 Water purchases 11,863 Utilities 80,051 Disposal charges 354,887 Rent 149,172 Advertising 7,694 Other 43,701 TOTAL OPERATING EXPENSES 1,763,432 OPERATING INCOME 25,669 NONOPERATING REVENUE (EXPENSE) Special assessments (l ,204) Interest on investments 190,070 Antenna lease 56,636 Other income 74,609 Interest expense (100,122) TOTAL NON OPERA TING REVENUE (EXPENSE) 219,989 INCOME BEFORE OPERATING TRANSFERS 245,658 OPERATING TRANSFERS IN 35,000 OPERATING TRANSFERS OUT (55,000) NET INCOME 225,658 RETAINED EARNINGS, JANUARY 1 2,623,987 RETAINED EARNINGS, DECEMBER 31 $ 2,849,645 See Notes to Financial Statements. -8- I I I Note 1: I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2002 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. Reporting Entity The City of Shorewood 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 primary government 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 primary government. Blended component units, although legally separate entities are, in substance, part of the City's operations and so data from these units are combined with data of the primary government. The City has the following component unit. Blended Component Units The Economic Development Authority (EDA) of the City was created pursuant to Minnesota statutes 469.090 through 469.108 to carry out economic and industrial development and redevelopment consistent with policies established by the Council. It is comprised of the members of the City Council and has a December 31 year end. The EDA activities are blended and reported in a separate special revenue fund. Separate financial statements are not issued for this component unit. B. Measurement Focus, Basis of Accounting and Basis of Presentation The accounts of the City are organized and operated on the basis of funds and account groups. A fund is an independent fiscal and accounting entity with a self-balancing set of accounts. Fund accounting segregates funds according to their intended purpose and is used to aid management in demonstrating compliance with fmance-related legal and contractual provisions. The minimum number of funds are maintained consistent with legal and managerial requirements. Account groups are a reporting device to account for certain assets and liabilities of the goverrunental funds not recorded directly in those funds. Revenue resulting from exchange transactions, in which each party gives and receives essentially equal value, is recorded on the accrual basis when the exchange takes place. On a modified accrual basis, revenue is recorded in the year in which the resources are measurable and become available. Non-exchange transactions, in which the City receives value 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 requirements include timing requirements, which specify the year when the resources are required to be used 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 a reimbursement basis. On a modified accrual basis, revenue from non-exchange transactions must also be available before it can be recognized. Deferred revenue arises 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. -10- I CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31,2002 I Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED The City has the following fund types and account groups: I Governmentalfunds are used to account for the City's general government activities. Governmental fund types use the flow of current fmancial resources measurement focus and the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., when they are "measurable and available"). "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to pay liabilities of the current period. The City considers all revenues available if they are collected within 60 days after year end. Expenditures are recorded when the related fund liability is incurred, except for unmatured interest on general long-term debt which is recognized when due, and certain compensated absences and claims and judgments which are recognized when the obligations are expected to be liquidated with expendable available fmancial resources. I I I Property taxes, franchise taxes, licenses, interest and special assessments are susceptible to accrual. Other receipts and taxes become measurable and available when cash is received by the government and are recognized as revenue at that time. I The preparation of general purpose fmancial 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. I Entitlements and shared revenues are recorded at the time of receipt or earlier if the susceptible to accrual criteria are met. Expenditure driven grants are recognized as revenue when the qualifying expenditures have been incurred and all other grant requirements have been met. I I Governmental funds include the following fund types: The general fund is the City's primary operating fund. It accounts for all fmancial resources of the City, except I those required to be accounted for in another fund. The special revenue funds account for revenue sources that are legally restricted to expenditures for specified I purposes (not including major capital projects). The debt service funds account for the servicing of general long-term debt not being fmanced by proprietary I funds. The capital projects funds account for the acquisition of fixed assets or construction of major capital projects I. not being fmanced by proprietary funds. I I I I -11- I I I Note 1: I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31,2002 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Proprietary funds are accounted for on the flow of economic resources measurement focus and use the accrual basis of accounting. Under this method, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred. In accordance with the provisions of the GASB Statement No. 20, Accounting and Financial Reporting for Proprietary Funds and other Governmental Entities that use Proprietary Fund Account, the City applies all applicable GASB pronouncements plus all Financial Accounting Standards Board (FASB) Statements and Interpretations, Accounting Principles Board opinions, and Accounting Research Bulletins issued on or before November 30, 1989, except for those that conflict with or contradict GASB pronouncements. The City has elected not to apply F ASB Statements and Interpretations issued after November 30, 1989. Proprietary funds include the following fund type: Enterprise funds are used to account for those operations that are financed and operated in a manner similar to private business or where the Council has decided that the determination of revenues earned, costs incurred and/or net income is necessary for management accountability. Fiduciary funds account for assets held by the government in a trustee capacity or as an agent on behalf of others. The agency fund is custodial in nature and does not present results of operations or have a measurement focus. Agency funds are accounted for using the modified accrual basis of accounting. This fund is used to account for escrow deposits of developers and builders in conjunction with the anticipated cost of improvements that will be necessary as a result of the development. Account groups. The general fixed assets account group is used to account for fixed assets not accounted for in proprietary funds. The general long-term debt account group is used to account for general long-term debt and certain other liabilities that are not specific liabilities of proprietary funds. C. Assets, Liabilities and 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 the 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. Minnesota statutes authorize the City to invest in obligations of the U.S. Treasury, connnercial paper, corporate bonds, repurchase agreements and shares of investment companies registered under the Federal Investment Company Act of 1940 and whose only investments are obligations guaranteed by the United States or its agencies. Investments for the City are valued at fair value. The Minnesota Municipal Money Market Fund investment pool operates in accordance with appropriate State laws and regulations. The reported value of the pool is the same as the fair value of the pool shares. -12- I CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31,2002 I Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Property Taxes I 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 Treasurer and tax settlements are made to the City during January, July, and December each year. ,I I 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 in lieu of taxes levied against the homestead property. The State remits this credit in two equal installments in October and December each year. I 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 after year end. I Accounts Receivable Accounts receivable include amounts billed for services provided before year end. Unbilled utility enterprise fund receivables are also included for services provided in 2002. The City annually certifies delinquent water and sewer accounts to the County for collection in the following year. Therefore, there has been no allowance for doubtful accounts established. I I Special Assessments I Special assessments represent the fmancing for public improvements paid for by benefiting property owners. These assessments are recorded as receivables upon certification to the County. Special assessments in governmental funds are recognized as revenue when they are received in cash or within 60 days after year end. All special assessments receivable are offset by a deferred revenue liability in governmental funds. Enterprise fund special assessments are recorded as contributed capital in the year of certification. I Interfund Receivables and Payables I Transactions between funds that are representative of lendinglborrowing arrangements outstanding at the end of the fiscal year are referred to as either "interfund 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 to/from other funds." I Advances between funds are offset by a fund balance reserve account in applicable governmental funds to indicate they are not available for appropriation and are not expendable from available financial resources. I Inventories and Prepaid Items/Deferred Charges I The inventories are stated at average cost, which approximates market using the first-in, first-out (FIFO) method. Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items or deferred charges. I I I -13- I I I I Note 1: I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2002 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Fixed Assets Fixed assets used in governmental fund types of the City are recorded in the general fixed assets account group at cost or estimated historical cost if purchased or constructed. Donated fixed assets are recorded at their estimated fair value at the date of donation. Assets in the general fixed assets account group are not depreciated. Interest incurred during construction is not capitalized on general fixed assets. Public domain (infrastructure) general fixed assets (e.g., roads, bridges, sidewalks and other assets that are immovable and of value only to the City) are not capitalized. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend assets' lives are not included in the general fixed assets group or capitalized in the proprietary funds. Property, plant and equipment in the proprietary funds of the City are recorded at cost. Property, plant and equipment donated to these proprietary fund type operations are recorded at their estimated fair value at the date of donation. Major outlays for capital assets and improvements are capitalized in proprietary funds as projects are constructed. Interest incurred during the construction phase of proprietary fund fixed assets is reflected in the capitalized value of the asset constructed, net of interest earned on the invested proceeds over the same period. Property, plant and equipment are depreciated in the proprietary funds of the City using the straight line method over the following estimated useful lives: Assets Years Furniture and equipment Collection and distribution system 5 - 10 40 Compensated Absences Vested accumulated vacation or sick leave that is expected to be liquidated with expendable available fmancial resources is reported as an expenditure and a fund liability of the governmental fund that will pay it. Amounts of vested or accumulated vacation leave that are not expected to be liquidated with expendable available fmancial resources are reported in the general long-term debt account group. At December 31, 2002 the amount recorded in general long-term debt was $68,034. No expenditure is reported for these amounts. Proprietary fund types record the liability as the benefits accrue to employees. This amount was $13,127 at year-end. Long-term Obligations The City reports long-term debt of governmental funds at face value in the general long-term debt account group. Certain other governmental fund obligations not expected to be fmanced with current available fmancial resources are also reported in the general long-term debt account group. Long-term debt and other obligations financed by proprietary funds are reported as liabilities in the appropriate funds. For governmental fund types, bond premiums and discounts, as well as issuance costs, are recognized during the current period. Bond proceeds are reported as an other financing source net of the applicable premium or discount. Issuance costs, other than those withheld from the actual net proceeds received, are reported as debt service expenditures. For proprietary fund types, bond premiums and discounts, as well as issuance costs, are deferred and amortized over the life of the bonds using the straight line method. -14- CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2002 I I Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Fund Equity I Reservations of fund balance represent amounts that are not appropriable or are legally segregated for a specific purpose. Reservations of retained earnings are limited to outside third-party restrictions. Designations of fund balance represent tentative management plans that are subject to change. The proprietary fund's contributed capital represents equity acquired through capital grants, capital contributions from developers and customers prior to January 1, 2001 or other funds. I I Memorandum Only - Total Columns Total columns on the general purpose financial statements are captioned as "memorandum only" because they do not represent consolidated fmancial information and are presented only to facilitate fmancial analysis. The columns do not present information that reflects fmancial position, results of operations or cash flows in accordance with accounting principles generally accepted in the United States of America. Interfund eliminations have not been made in the aggregation of this data. I I Comparative Data/Reclassifications I Comparative total data for the prior year have been presented in the selected sections of the accompanying financial statements in order to provide an understanding of changes in the City's fmancial position and operations. Also, certain amounts presented in the prior year data have been reclassified in order to be consistent with the current year's presentation. I Note 2: STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY I 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. I 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 15th, the proposed budget is presented to the Council for review. The Council holds public hearings and a fmal budget is prepared and adopted in early December. I The appropriated budget is prepared by fund, function and department. The City's department heads, with the approval of the City Administrator, may make transfers of appropriations within a department. Transfers of appropriations between departments require the approval of the Council. The legal level of budgetary control is the department level. Budgeted amounts are as originally adopted. I I I I I I -15- I I I CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31,2002 Note 2: STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY - CONTINUED I B. Excess of Expenditures over Appropriations I For the year ended December 31,2002, expenditures exceeded appropriations in the following departments within the general fund: I Department Budget Actual Excess I City clerk Planning and zoning Capital outlay $ 164,620 $ 137,417 56,875 176,731 $ 146,209 341,765 12,111 8,792 284,890 These over expenditures were funded with revenue in excess of budget. I C. Deficit Fund Equity I The following fund had a deficit fund balance as of December 31, 2002. The deficit in this fund will be eliminated by future revenue sources. Fund Amount I Debt service 1991 Improvement and Refunding $ 37,482 I Note 3: DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS A. Deposits and Investments I I Cash balances of the City's funds are combined (pooled) and invested to the extent available in various investments authorized by Minnesota statutes. Each fund's portion of this pool (or pools) is displayed on the [mancial statements as II cash and temporary investments. II For purposes of identifying the risk of investing public funds, the balances are categorized as follows: Deposits I 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. I I I 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 (140 percent in the case of mortgage notes pledged). Authorized collateral includes the legal investments described below, as well as certain first mortgage notes, and certain other state or local government obligations. Minnesota statutes require that securities pledged as collateral be held in safekeeping by the City or in a [mancial institution other than that furnishing the collateral. At year end, the City's carrying amount of deposits was $1,616,745 and the bank balance was $1,631,829. The entire bank balance was covered by federal depository insurance. I I I -16- CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2002 Note 3: DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS - CONTINUED Investments Investments are categorized into these three categories of credit risk: 1. Insured or registered, or securities held by the City or its agent in the City's name. I I I I 2. Uninsured and unregistered, with securities held by the counterparty's trust department or agent in the City's I name. 3. Uninsured and unregistered, with securities held by the counterparty, or by its trust department or agent but not in the City's name. I The City also invests in various money market accounts. The investment in the money market accounts is not subject to the categories of credit risk described above. The value of the investment in money markets is equal I to the value of the pool shares. At year end, the City's investment balances were as follows: Category 2 Fair Value 3 U.S. Government Securities Commercial Paper $ 12,419,560 $ 99,875 - $ - $ 12,419,560 99.875 Total - $ 12,519,435 $ 12.519.435 $ Investments not subject to categorization: Minnesota Municipal Money Market fund Broker money market accounts Sweep money market account 233,970 410,286 3,391,577 Total investments $ 16.555.268 Cash on Hand Petty cash in the possession of the City totals $1,300. Cash and Investments Summary A reconciliation of cash and investments as shown on the Combined Balance Sheet for the City follows: Cash on hand Carrying amount of deposits Carrying amount of investments $ 1,300 1,616,745 16.555,268 Total cash and temporary investments $ 18.173.313 -17- I I I I I I I I I I I I I I I I I I Note 3: I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31,2002 DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS - CONTINUED B. Lease Receivable On September 1,2002, the EDA entered into a capital lease agreement as lessor with the Excelsior Fire District and the South Lake Minnetonka Police Department for use of a building that will be completed in 2003. The City is a member of both joint powers agreements. The interest rate ranges from 3.00 to 5.00 percent and the maturity date is February 1,2023. The future minimum lease payments are as follows: Year Ending December 31, Amount 2003 2004 2005 2006 2007 Thereafter $ 447,705 488,405 828,230 831,755 823,155 13.097.515 Total Less amount representing interest 16,516,765 (6.566.765) Principal $ 9.950.000 C. Fixed Assets A summary of changes in general fixed assets for the year ended December 31, 2002 is as follows: Balance Balance Beginning End of Year Additions Deletions of Year Land $ 456,826 $ 285,000 $ - $ 741,826 Buildings and structures 1,731,011 1,731,011 Improvements other than buildings 1,383,936 7,945 1,391,881 Furniture and equipment 1.547.678 25.889 13.770 1.559.797 Total $ 5.119.451 $ 318.834 $ 13.770 $ 5.424.515 The following is a summary of enterprise fund fixed assets at December 31, 2002: Stormwater Water Sewer Management Liquor Total Furniture and equipment $ 25,113 $ 37,827 $ - $ 102,366 $ 165,306 Collection and distribution system 6.852.323 7.890.976 1.197.705 15.941.004 Total 6,877,436 7,928,803 1,197,705 102,366 16,106,310 Less accumulated depreciation ( 1.734.526) (5.310.416) 00.746) (61.529) (7.117.217) Net fixed assets $ 5.142.910 $ 2.618.387 $ 1.1 86.959 $ 40.837 $ 8.989.093 -18- CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31,2002 Note 3: DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS - CONTINUED D. Due To/From Other Funds The composition of interfund balances as of December 31, 2002 is as follows: Receivable Fund Payable Fund Amount 1993 Improvement and Refunding Sewer 1991 Improvement and Refunding Stormwater Management Utility $ 40,000 180.000 Total $ 220.000 E. Deferred Revenue Deferred revenue at December 31, 2002 is comprised of the following: Debt General Service EntelJ'rise Total Delinquent taxes $ 32,421 $ - $ - $ 32,421 Special assessments Deferred 21,603 27,048 48,651 Lease receivable 9.950.000 40.394 9.990.394 Total $ 54.024 $ 9.977.048 $ 40.394 $ 10.071.466 F. 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 general government and proprietary activities. The bonds are reported in the proprietary funds if they are expected to be paid from proprietary activities. General obligation bonds are direct obligations and pledge the full faith and credit of the City. General obligation bonds currently outstanding are as follows: General Long-term Debt General Obligation Improvement Bonds The following bonds were issued to [mance various improvements and will be repaid primarily from special assessments levied on the properties benefiting from the improvements. Some issues, however, are partly financed by ad valorem tax levies. Each year the combined assessment and tax levy equals 105 percent of the amount required for debt service. The excess of 5 percent is to cover any delinquencies in tax or assessment payments. All special assessment debt is backed by the full faith and credit of the City. Authorized Balance and Interest Issue Maturity at Issued Rate Date Date Year End G.O. Improvement Bonds of 1993 $ 325,000 4.15-4.80% 12-01-93 02-01-04 $ 40.000 -19- I I I I I I I I I I I I I I I I I I I I I Note 3: I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2002 DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS - CONTINUED Lease Revenue Bonds The following bonds were issued by the EDA to finance construction of three public safety facilities. The bonds will be repaid from lease payments from the Excelsior Fire District and the South Lake Minnetonka Police Department. The City is a member of both entities. Authorized and Issued Balance at Year End Maturity Date Issue Date Interest Rate Public Safety Fire Facility, Series 2002A $ 3,865,000 3.00-5.50% 09-01-02 02-01-23 $ 3,865,000 Public Safety Police Facility, Series 2002B 4,025,000 3.00-5.50 09-01-02 02-01-23 4,025,000 Public Safety Fire Facility, Series 2002C 2,060,000 3.00-5.50 09-01-02 02-01-23 2.060.000 Total Lease Revenue Bonds $ 9.950.000 Other General Long-Term Debt Capital Lease Payable During 1996, the City entered into a lease, with option to purchase, agreement as lessee for financing the South Shore Senior Center project. Title remains with the City so long as they are not in default of terms in the lease agreement. The lease agreement qualifies as a capital lease for accounting purposes and, therefore, has been recorded at the present value of the future minimum lease payments as of the date of its inception. $ 311,000 08-01-08 $ 185.635 6.22% 05-30-96 Sick Leave and Severance Payable This liability represents vested benefits earned by employees through the end of the year, which will be paid at retirement in future periods. Total sick leave/severance payable $ 68.034 -20- CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2002 Note 3: DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS - CONTINUED Enterprise Fund Debt General Obligation Revenue Bonds The following bonds were issued to fund improvements in the Water enterprise fund. They will be repaid through user charges and tax levies. Authorized Balance and Interest Issue Maturity at Issued Rate Date Date Year End G.O. Water Revenue Bonds of 1995 $ 1,920,000 4.45-5.50% 11-01-95 02-01-11 $ 1,155,000 G.O. Water Revenue Bonds of 1996 860,000 4.45-5.40 11-01-96 02-01-12 575.000 Total General Obligation Revenue Bonds $ 1.730.000 Changes in General Long-term Liabilities. During the year ended December 31, 2002, the following changes occurred in liabilities reported in the genera11ong-term debt account group: Balance Balance January 1, December 31, 2002 Additions Reductions 2002 G.O. Improvement Bonds $ 155,000 $ - $ 115,000 $ 40,000 Lease Revenue Bonds 9,950,000 9,950,000 Capital Lease payable 210,468 24,833 185,635 Sick leave/severance payable 55.988 12.046 68.034 Total $ 421.456 $ 9.962.046 $ 139.833 $ 10.243.669 The annual service requirements to maturity for all bonds and leases outstanding at December 31, 2002 are as follows: G.O. Capital Lease G.O. Year Ending Improvement Lease Revenue Revenue December 31. Bonds Payable Bonds Bonds Total 2003 $ 21,430 $ 37,544 $ 447,705 $ 267,904 $ 774,583 2004 20,480 37,544 488,405 264,090 810,519 2005 37,544 828,230 245,244 1,111,018 2006 37,544 831,755 246,240 1,115,539 2007 37,544 823,155 231,945 1,092,644 Thereafter 37.544 13.097.515 893.515 14.028.574 Total 41,910 225,264 16,516,765 2,148,938 18,932,877 Less interest (1.910) (39,629) (6.566.765) (418.938) (7.027,242) Principal $ 40.000 $ 185.635 $ 9.950.000 $ 1.730.000 $ 1 1.905.635 Amount Availablefor Debt Retirement. Available fund balance in the debt service funds for repayment of long-term debt totaled $208,801 at year end. Amount to be Provided for Debt Retirement. This represents future revenue to be generated for debt payments and sick leave/severance benefits payable, generally including interest earnings, tax increments, scheduled tax levies and deferred (future) special assessment levies. -21- I I I I I I I I I I I I I I I I I I I I I I Note 3: I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2002 DETAILED NOTES ON ALL FUNDS AND ACCOUNT GROUPS - CONTINUED G. Fund Equity Reservations and Designations The components of fund equity are described in Note 1. Certain reservations and designations have been made in the following funds: Fund Purpose Amount Fund Balance - Reserved General Prepaid items $ 44,994 Debt service 1993 Improvement and Refunding Debt service on bonds issued 154,530 Waterford III Tax Increment Debt service on bonds issued 9,993 2002 Public Safety Building Debt service on bonds issued 81.760 Total reserved $ 291.277 Fund Balance - Unreserved - Designated General Working capital $ 2,112,985 Capital projects Public Facilities/Office Equipment Capital improvements 79,622 Park Capital Improvement Capital improvements 95,693 Equipment Replacement Equipment 364,888 Street Reconstruction Streets 1,728,674 MSA Construction Street construction 288,671 Service Community Center Capital improvements 35,720 EDA Project Public safety facility construction 7,488.550 Total unreserved - designated $ 12.194.803 H. Contributed Capital The changes in the City's contributed capital accounts for its enterprise funds in 2002 are as follows: Stormwater Sources Water Sewer Management Total Balance, January 1,2002 $ 4,924,058 $ 4,657,264 $ 474,768 $ 10,056,090 Additions - contributions from other funds 143,489 143,489 Balance, December 31, 2002 $ 4.924.058 $ 4.657.264 $ 618.257 $ 10.199.579 -22- CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2002 I I Note 4: DEFINED BENEFIT PENSION PLANS - STATEWIDE A. Plan Description I 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 Public Employees Retirement Fund (PERF), which is a cost-sharing, multiple-employer retirement plan. This plan is established and administered in accordance with Minnesota statutes, chapters 353 and 356. I PERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated Plan members are covered by Social Security and Basic Plan members are not. All new members must participate in the Coordinated Plan. I PERA provides retirement benefits as well as disability benefits to members, and benefits to survivors upon death of eligible members. Benefits are established by Minnesota statute, and vest after three years of credited service. The defined retirement benefits are based on a member's highest average salary for any five successive years of allowable service, age and years of credit at termination of service. I I Two methods are used to compute benefits for PERF's Coordinated and Basic Plan members. The retiring member receives the higher of a step-rate benefit accrual formula (Method 1) or a level accrual formula (Method 2). Under Method 1, the annuity accrual rate for a Basic Plan member is 2.2 percent of average salary for each of the first 10 years of service and 2.7 percent for each remaining year. The annuity accrual rate for a Coordinated Plan member is 1.2 percent of average salary for each of the first 10 years and 1.7 percent for each remaining year. Under Method 2, the annuity accrual rate is 2.7 percent of average salary for Basic Plan members and 1.7 percent for Coordinated Plan members for each year of service. A reduced retirement annuity is also available to eligible members seeking early retirement. I I I There are different types of annuities available to members upon retirement. A single-life annuity is a lifetime annuity that ceases upon the death of the retiree - - no survivor annuity is payable. There are also various types of joint and survivor annuity options available which will be payable over joint lives. Members may also leave their contributions in the fund upon termination of public service in order to qualify for a deferred annuity at retirement age. Refunds of contributions are available at any time to members who leave public service, but before retirement benefits begin. I I 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. I PERA issues a publicly available fmancial report that includes fmancial statements and required supplementary information for PERF and PEPFF. That report may be obtained on the web at rnnpera.com, by writing to PERA at 60 Empire Drive, Suite 200, St. Paul, Minnesota 55103-1855 or by calling 651-296-7460 or 1-800-652-9026. I 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. PERF Basic Plan members and Coordinated Plan members are required to contribute 9.10 percent and 5.10 percent, respectively, of their annual covered salary. The City is required to contribute the following percentages of annual covered payroll: 11.78 percent for Basic Plan PERF members, and 5.53 percent for Coordinated Plan PERF members. The City's contributions to the PERF for the years ending December 31, 2002, 2001, and 2000 were $60,485, $53,743 and $44,029, respectively. The City's contributions were equal to the contractually required contributions for each year as set by Minnesota statute. I I I I -23- I I I Note 5: I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2002 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 budget is divided between the participating cities based upon a five-year average demand for service in each city. Any budget shortfall is made up first from department reserves, with any excess shortfall assessed to each participating community according to the formula. The current agreement continues through December 31, 2002. The most recent year of audited information is December 31, 2002. The Department has accounts payable, and accrued payroll and compensated absences in the general fund of $161,024. There is no other current or long-term debt outstanding as of December 31,2002. The following is a summary of the Department's balance sheet as of December 31,2002 and the statement of revenue, expenditures and changes in fund balance for the general fund for the year ended December 31, 2002: SOUTH LAKE MINNETONKA POLICE DEPARTMENT BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS DECEMBER 31, 2002 General Totals General Fixed (Memorandum Only) Fund Assets 2002 2001 Total assets $ 394.675 $ 482.458 $ 877.133 $ 858.387 Liabilities $ 161,024 $ - $ 161,024 $ 142,903 Fund equity and other credits 233.651 482.458 716.109 715.484 Total liabilities, fund equity and other credits $ 394.675 $ 482.458 $ 877.133 $ 858.387 SOUTH LAKE MINNETONKA POLICE DEPARTMENT SUMMARY STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE - GENERAL FUND - BUDGET AND ACTUAL YEAR ENDED DECEMBER 31,2002 (With comparative actual amounts for the year ended December 31, 2001) 2002 2001 Variance - Favorable Budget Actual (Unfavorable ) Actual Total revenue $ 1,476,050 $ 1,538,288 $ 62,238 $ 1,399,954 Total expenditures 1.476.050 1.565.166 (89.116) 1.386.686 Excess (deficiency) ofrevenue over expenditures $ (26,878 ) $ (26.878 ) 13,268 Fund balance, January 1 260.529 247.261 Fund balance, December 31 $ 233.651 $ 260.529 -24- CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2002 I I Note 5: JOINT VENTURES - CONTINUED B. Southshore Senior Community Center I The City participates in a joint venture with the Cities of Deephaven, Excelsior, Greenwood and Tonka Bay, I which establishes the Southshore Senior Community Center (Senior Center) to provide senior citizens educational and recreational activities. Upon completion of the facility, the member cities will lease the Senior Center to the Friends of the Southshore Senior Community Center (Community Center). The term of the lease shall be 25 years at a rental rate of $1 per year. In addition to the rental rate, the Community Center is required I to pay all operating costs of the Senior Center. The member cities are responsible for a proportionate share of the building construction. Shorewood financed its obligation by issuing a lease purchase note. The remaining balance on the lease is $185,635 and is reflected in the genera110ng-term debt account group. This will be paid I out of the general fund. In the event operating costs are not covered by revenue, each member is responsible for their proportionate share oflosses. The building costs incurred by the City are reported in the Senior Community Center capital project fund and was recorded in the general fixed asset account group. The ownership interest of the City is proportionate to each City's investment in the Senior Center. Separate financial I statements are issued for the Community Center and can be obtained at City offices. C. Excelsior Fire District I In August of 2000, the cities of Deep haven, 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 often members and five alternate members. Each member city appoints two representatives on the board 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, 339 3Td Street, Excelsior, Minnesota 55331. I I Note 6: OTHER INFORMATION A. Risk Management I 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. I I Liabilities are reported when it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. Liabilities, if any, include an amount for claims that have been incurred but not reported (IBNRs). The City's management is not aware of any incurred but not reported claims. I I I I I -25- I I I CITY OF SHOREWOOD, MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 31,2002 I Note 6: OTHER INFORMATION - CONTINUED I B. Segment Information for Enterprise Funds The City operates five enterprise funds. Selected segment information is presented below. I Stormwater Management Water Sewer Recycling Utility Liquor Total Operating revenue $ 287,465 $ 698,452 $ 81,860 $ 43,985 $ 677,339 $ 1,789,101 Depreciation expense 180,805 202,291 4,376 10,085 397,557 Operating income (loss) (129,915 ) 29,214 (22,848 ) 25,824 123,394 25,669 Operating transfers in 35,000 35,000 Operating transfers out (10,000 ) (15,000 ) (30,000 ) (55,000 ) Net income (loss) (124,163 ) 125,674 3,673 113,541 106,933 225,658 Fixed asset additions 935 143,489 7,830 152,254 Net working capital 1,665,974 3,177,286 58,052 65,043 625,708 5,592,063 Total assets 7,098,112 5,832,921 58,257 1,432,207 784,066 15,205,563 Bonds payable 1,730,000 1,730,000 Total equity 5,276,952 5,795,673 58,052 1,252,002 666,545 13,049,224 I I I Legal Debt Margin In accordance with Minnesota statutes, the City may not incur or be subject to net debt in excess of two percent of the market value of taxable property within the City. Net debt is payable solely from ad valorem taxes and, therefore, excludes debt financed partially or entirely by special assessments, enterprise fund revenues or tax increments. There is no debt subject to the limit. I Note 7: OPERATING LEASES C. I I The City leases space for liquor store operations. These leases are considered, for accounting purposes, to be operating leases. Lease expense for the year ended December 31,2002 amounted to $149,172. Future minimum lease payments for all leases are as follows: I Year Ending Shorewood Waterford December 31 , Plaza Center Total 2003 $ 41,895 $ 55,000 $ 96,895 2004 55,000 55,000 2005 55,000 55,000 2006 55,000 55,000 2007 13,750 13.750 Total $ 41.895 $ 233.750 $ 275.645 I I The new lease for Waterford Center began April 1 , 2002 and will run through March 31, 2007. The Shorewood Village Plaza lease began January 1, 1997 and ran through December 31,2001 and was extended one year to December 31, 2002. On December 16, 2002, the lease was extended through December 31, 2003. I I Note 8: NEW REPORTING STANDARD I In June 1999, the Governmental Accounting Standards Board (GASB) issued Statement No. 34 "Basic Financial Statement and Management's Discussion and Analysis for State and Local Governments." This Statement establishes new financial reporting requirements for state and local governments throughout the United States. When implemented, it win require new information and restructure much of the information that governments have presented in the past. Comparability with reports issued in all prior years will be affected. The City is required to implement this standard for the fiscal year ending December 31, 2004. The City has not yet determined the full impact that the adoption of GASB Statement No. 34 will have on the fmancial statements. These financial statements are presented in accordance with the fmancial reporting model in effect prior to that described in GASB Statement No. 34. I I -26- I I I I I I CITY OF SHOREWOOD, MINNESOTA I GENERAL FUND I The general fund is used to account for resources traditionally associated with government, which are not required legally or by sound financial management to be accounted for in other funds. It normally receives a greater variety and number of taxes and other general revenues than any other fund. The majority of the current day-to-day operations will be fmanced from this fund. I I I I I I I I I I I ASSETS Cash and temporary investments Receivables Accrued interest Delinquent taxes Accounts Special assessments Delinquent Deferred Due from other funds Prepaid items TOTAL ASSETS LIABILITIES AND FUND BALANCE LIABILITIES Accounts and contracts payable Due to other governments Salaries payable Deferred revenue TOTAL LIABILITIES FUND BALANCE Reserved for prepaid items Unreserved Designated for working capital TOTAL FUND BALANCE CITY OF SHOREWOOD, MINNESOTA GENERAL FUND COMP ARA TIVE BALANCE SHEETS DECEMBER 31,2002 AND 2001 TOTAL LIABILITIES AND FUND BALANCE -27- I Exhibit A-I I 2002 2001 I $ 2,161,617 $ 1,919,732 I 17,296 5,718 59,575 38,540 I 33,700 16,897 92 21,511 118 I 3,342 44,994 117,760 I $ 2,338,785 $ 2,102,107 I $ 116,623 $ 37,328 2,821 4,252 I 7,338 15,232 54,024 22,226 180,806 79,038 I 44,994 117,760 I 2,112,985 1,905,309 I 2,157,979 2,023,069 $ 2,338,785 $ 2,102,107 I I I I I I I I CITY OF SHOREWOOD, MINNESOTA Exhibit A-2 I GENERAL FUND STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL I YEAR ENDED DECEMBER 31, 2002 (With comparative actual amounts for the year ended December 31, 200 I) I 2002 2001 Variance - Favorable Budget Actual (Unfavorable) Actual I REVENUE Taxes General property taxes $ 2,566,826 $ 2,558,366 $ (8,460) $ 2,128,512 I Fiscal disparities 100,297 100,297 78,013 Total 2,667,123 2,658,663 (8,460) 2,206,525 I Licenses and permits Business 17,200 13,859 (3,341) 12,545 I Nonbusiness 182,000 215,375 33,375 336,970 Total 199,200 229,234 30,034 349,515 I Intergovernmental State Local government aid 8,417 8,417 I Property tax credits 96,244 96,244 427,003 Other 18,501 67,122 48,621 70,266 I Total 123,162 171,783 48,621 497,269 Charges for services I General government 20,000 28,175 8,175 25,257 Parks and recreation 10,000 17,904 7,904 16,965 Total 30,000 46,079 16,079 42,222 I Fines and forfeitures 50,677 89,632 38,955 61,243 I Interest on investments 110,000 114,832 4,832 122,231 Miscellaneous revenue I Refunds and reimbursements 10,000 6,907 (3,093) Contributions and donations 285,000 285,000 Other 25,000 28,003 3,003 38,771 I Total 35,000 319,910 284,910 38,771 TOTAL REVENUE 3,215,162 3,630,133 414,971 3,317,776 I I I -28- I CITY OF SHOREWOOD, MINNESOTA Exhibit A-2 GENERAL FUND I STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE - CONTINUED BUDGET AND ACTUAL - CONTINUED YEAR ENDED DECEMBER 31, 2002 I (With comparative actual amounts for the year ended December 31, 2001) 2002 2001 Variance - I Favorable Budget Actual (Unfavorable) Actual EXPENDITURES I Current General government Mayor and Council I Personal services $ 12,600 $ 13,564 $ (964) $ 13,564 Supplies 2,464 544 1,920 725 Other services and charges 105,750 79,585 26,165 73,744 I Total 120,814 93,693 27,121 88,033 Administrative I Personal services 98,140 98,716 (576) 99,764 Supplies 400 400 47 Other services and charges 8,400 5,823 2,577 4,792 I Total 106,940 104,539 2,401 104,603 City clerk I Personal services 107,909 131,494 (23,585) 96,939 Supplies 28,475 17,403 11,072 11,922 I Other services and charges 28,236 27,834 402 19,192 Total 164,620 176,731 (12,111) 128,053 Finance I Personal services 112,134 117,030 (4,896) 106,001 Supplies 13,500 1,090 12,410 1,053 I Other services and charges 10,200 7,888 2,312 8,239 Total 135,834 126,008 9,826 115,293 I Professional services Supplies 8,000 8,820 (820) I Other services and charges 190,800 160,574 30,226 197,473 Total 198,800 169,394 29,406 197,473 Planning and zoning I Personal services 118,767 128,405 (9,638) 117,204 Supplies 900 842 58 122 I Other services and charges 17,750 16,962 788 24,549 Total 137,417 146,209 (8,792) 141,875 I -29- I I CITY OF SHOREWOOD, MINNESOTA Exhibit A-2 I GENERAL FUND STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE - CONTINUED BUDGET AND ACTUAL - CONTINUED I YEAR ENDED DECEMBER 31, 2002 (With comparative actual amounts for the year ended December 31, 2001) 2002 2001 I Variance - Favorable Budget Actual (Unfavorable) Actual I EXPENDITURES - CONTINUED Current - Continued General government - Continued I Municipal building Supplies $ 9,585 $ 7,332 $ 2,253 $ 4,271 Other services and charges 97,050 82,228 14,822 101,053 I Total 106,635 89,560 17,075 105,324 I City engineer Personal services 85,139 94,211 (9,072) 85,495 Supplies 1,100 196 904 261 Other services and charges 11,700 1,380 10,320 14,736 I Total 97,939 95,787 2,152 100,492 I Total general government 1,068,999 1,001,921 67,078 981,146 Public safety I Police protection Other services and charges 615,443 609,192 6,251 549,138 Animal control I Other services and charges 22,700 19,900 2,800 19,486 Fire protection I Other services and charges 295,500 293,029 2,471 248,398 Protective inspection I Personal services 91,353 77,595 13,758 68,841 Supplies 400 361 39 1,030 Other services and charges 7,080 8,715 (1,635) 6,177 I Total 98,833 86,671 12,162 76,048 I Total public safety 1,032,476 1,008,792 23,684 893,070 Public works General maintenance I Personal services 235,205 166,853 68,352 195,817 Supplies 40,000 34,320 5,680 23,212 Other services and charges 23,460 24,113 (653) 36,628 I Total 298,665 225,286 73,379 255,657 I -30- I CITY OF SHOREWOOD, MINNESOTA Exhibit A-2 GENERAL FUND I STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE - CONTINUED BUDGET AND ACTUAL - CONTINUED YEAR ENDED DECEMBER 31, 2002 I (With comparative actual amounts for the year ended December 31,2001) 2002 2001 Variance - I Favorable Budget Actual (Unfavorable) Actual EXPENDITURES - CONTINUED I Current - Continued Public works Streets and highways I Personal services $ 105,283 $ 62,839 $ 42,444 $ 77,123 Supplies 35,000 32,277 2,723 46,498 Other services and charges 6,000 8,930 (2,930) 8,669 I Total 146,283 104,046 42,237 132,290 Snow and ice removal I Personal services 32,656 14,655 18,001 24,215 Supplies 17,500 25,358 (7,858) 14,424 Total 50,156 40,013 10,143 38,639 I Traffic control I Supplies 5,050 1,250 3,800 3,535 Other services and charges 34,700 33,228 1,472 35,259 Total 39,750 34,478 5,272 38,794 I Sanitation and waste removal Personal services 650 1,138 (488) 1,619 I Other services and charges 3,500 2,854 646 5,839 Total 4,150 3,992 158 7,458 I Tree maintenance Personal services 10,463 14,911 (4,448) 7,900 I Supplies 850 369 481 286 Other services and charges 13,300 5,435 7,865 6,068 Total 24,613 20,715 3,898 14,254 I Total public works 563,617 428,530 135,087 487,092 Personal services 119,395 110,551 8,844 86,170 I Supplies 19,500 10,367 9,133 8,617 Other services and charges 33,500 39,197 (5,697) 31,352 I Total culture and recreation 172,395 160,115 12,280 126,139 Total current expenditures 2,837,487 2,599,358 238,129 2,487,447 I -31- I I CITY OF SHOREWOOD, MINNESOTA Exhibit A-2 I GENERAL FUND STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE - CONTINUED BUDGET AND ACTUAL - CONTINUED I YEAR ENDED DECEMBER 31, 2002 (With comparative actual amounts for the year ended December 31, 2001) I 2002 2001 Variance - Favorable Budget Actual (Unfavorable) Actual I EXPENDITURES - CONTINUED Capital outlay General government $ 15,931 $ 11,601 $ 4,330 $ 14,896 I Public safety 400 287 113 Public works 2,625 655 1,970 Culture and recreation 375 291,678 (291,303) I Total capital outlay 19,331 304,221 (284,890) 14,896 I Debt service Principal 24,833 24,833 23,358 Interest and other 12,711 12,711 14,186 I Total debt service 37,544 37,544 37,544 TOTAL EXPENDITURES 2,894,362 2,941,123 (46,761) 2,539,887 I EXCESS (DEFICIENCY) OF REVENUE OVER EXPENDITURES 320,800 689,010 368,210 777,889 I OTHER FINANCING SOURCES (USES) Operating transfers in 55,000 55,000 30,000 I Operating transfers out (375,800) (609,100) (233,300) (534,000) TOTAL OTHER FINANCING SOURCES (USES) (320,800) (554,100) (233,300) (504,000) I EXCESS (DEFICIENCY) OF REVENUE AND OTHER FINANCING SOURCES OVER EXPENDITURES AND OTHER USES $ 134,910 $ 134,910 273,889 I FUND BALANCE, JANUARY 1 2,023,069 1,749,180 I FUND BALANCE, DECEMBER 31 $ 2,157,979 $ 2,023,069 I I I I -32- I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA DEBT SERVICE FUNDS Debt service funds are used to account for the payment of interest and principal on long-term general obligation debt other than debt issued for and serviced primarily by enterprise funds. 1993 Improvement and Refundin2 Fund - This fund was established to account for the accumulation of resources for payment of interest and principal on bonds issued for the Season's development improvements and to refund the 1987 refunding bonds. Waterford III Tax Increment Fund - This fund was established to account for the accumulation of resources for payment of interest and principal on bonds issued for the Waterford III Intersection Improvements. 1991 Improvement and Refundin2 Fund - This fund was established to account for the accumulation of resources for the payment of interest and principal on bonds issued for the SE water treatment plant, Pine Bend improvements, Church Road improvements, and to refund the 1986 improvement bonds. 2002 Public Safety Buildin2 - This fund was established to account for the accumulation of resources for the payment of interest and principal on bonds issued to fmance construction of the public safety facility. I CITY OF SHOREWOOD, MINNESOTA DEBT SERVICE FUNDS COMBINING BALANCE SHEET DECEMBER 31, 2002 (With comparative totals for December 31,2001) 1993 1991 Improvement Waterford Improvement 2002 and III Tax and Public Safety Refunding Increment Refunding Building ASSETS Cash and temporary investments $ 113,562 $ 9,939 $ 2,228 $ 81,760 Receivables Accrued interest 968 54 290 Special assessments Deferred 27,048 Lease 9,950,000 Due from other funds 40,000 TOTAL ASSETS $ 154,530 $ 9,993 $ 29,566 $ 10,031,760 LIABILITIES AND FUND BALANCE (DEFICIT) LIABILITIES Due to other funds $ $ $ 40,000 $ Deferred revenue 27,048 9,950,000 TOTAL LIABILITIES 67,048 9,950,000 FUND BALANCE (DEFICIT) Reserved for debt service 154,530 9,993 81,760 Unreserved - un designated (37,482) TOTAL FUND BALANCE (DEFICIT) 154,530 9,993 (37,482) 81,760 TOTAL LIABILITIES AND FUND BALANCE (DEFICIT) $ 154,530 $ 9,993 $ 29,566 $ 10,031,760 I I I I I I I I I I I -33- I I I I I I I I Exhibit B-1 I I I Totals 2002 2001 I $ 207,489 $ 230,876 1,312 545 I 27,048 32,458 9,950,000 I 40,000 $ 10,225,849 $ 263,879 I $ 40,000 $ I 9,977,048 32,458 10,017,048 32,458 I 246,283 231,421 I (37,482) 208,801 231,421 I $ 10,225,849 $ 263,879 I I I I I I I -34- I CITY OF SHOREWOOD, MINNESOTA DEBT SERVICE FUNDS I COMBINING STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE (DEFICIT) YEAR ENDED DECEMBER 31,2002 (With comparative totals for the year ended December 31, 2001) I 1993 1991 Improvement Waterford Improvement 2002 and III Tax and Public Safety I Refunding Increment Refunding Building REVENUE Special assessments $ $ $ 7,844 $ I Interest on investments 6,598 414 1,897 34,077 TOTAL REVENUE 6,598 414 9,741 34,077 I EXPENDITURES Debt service Principal 20,000 95,000 I Interest and service charges 2,883 5 3,245 TOTAL EXPENDITURES 22,883 5 98,245 I EXCESS (DEFICIENCY) OF REVENUE OVER EXPENDITURES (16,285) 409 (88,504) 34,077 I OTHER FINANCING SOURCES (USES) Proceeds on sale of bonds 47,683 I EXCESS (DEFICIENCY) OF REVENUE AND OTHER FINANCING SOURCES OVER EXPENDITURES AND I OTHER FINANCING USES (16,285) 409 (88,504) 81,760 FUND BALANCE, JANUARY 1 170,815 9,584 51,022 FUND BALANCE (DEFICIT), DECEMBER 31 $ 154,530 $ 9,993 $ (37,482) $ 81,760 I I I I I I I -35- I I Exhibit B-2 I I I Totals 2002 2001 I $ 7,844 $ 50,791 42,986 14,603 I 50,830 65,394 I 115,000 125,000 6,133 12,830 I 121,133 137,830 I (70,303) (72,436) I 47,683 I (22,620) (72,436) I 231,421 303,857 $ 208,801 $ 231,421 I I I I I I I -36- I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA 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/Office Equipment - This fund was established to account for capital improvement projects for public facilities and replacement of office equipment that may be flllanced without the need to issue bonds. Park Capital Improvement - This fund accounts for park land acquisition and other capital improvements in the City parks. Equipment Replacement - This fund was established for the purpose of funding the replacement of capital equipment. Street Reconstruction - This fund was established for the purpose of funding the periodic reconstruction of City streets and roadways. MSA Construction - This fund was established to account for the accumulation of Municipal State Aid (MSA) to fund the periodic reconstruction ofMSA designated roads. Trail Capital Improvements - This fund was established to account for trail extensions and improvements. Senior Communitv Center - This fund was established to account for the construction of a Senior Community Center. EDA - Public Safetv Facilities Proiect - This fund was established for the purpose of accounting for construction of the new public safety facility. I Exhibit C-l I I EDA I Public Trail Senior Safety MSA Capital Community Facilities Totals I Construction Improvements Center Project 2002 2001 $ 320,211 $ $ 35,526 $ 8,071,015 $ 10,684,999 $ 2,663,770 I 4,321 194 15,145 7,897 42,085 42,085 265,649 I 1,279 83,211 I $ 366,617 $ $ 35,720 $ 8,071,015 $ 10,742,229 $ 3,021,806 I $ 77 ,946 $ $ $ 582,465 $ 660,411 $ 219,930 I 240,250 1,279 77 ,946 582,465 660,411 461,459 I I 288,671 35,720 7,488,550 10,081,818 2,703,545 (143,198) I 288,671 35,720 7,488,550 10,081,818 2,560,347 I $ 366,617 $ $ 35,720 $ 8,071,015 $ 10,742,229 $ 3,021,806 I I I I I -38- I CITY OF SHOREWOOD, MINNESOTA CAPITAL PROJECTS FUNDS I COMBINING STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE YEAR ENDED DECEMBER 31,2002 I (With comparative totals for the year ended December 31,2001) Public I Facilities! Park Office Capital Equipment Street I Equipment Improvement Replacement Reconstruction REVENUE Intergovernmental $ $ $ $ I Special assessments 1,391 Interest on investments 2,705 1,886 11,957 61,485 Miscellaneous Park dedication fees 7,500 I Contributions and donations 4,500 Other 1,515 TOTAL REVENUE 4,096 15,401 11,957 61,485 I EXPENDITURES I Capital outlay General government 18,751 134 Public safety I Public works 76,616 Culture and recreation 2,434 Debt service I Interest and other 8,114 TOTAL EXPENDITURES 18,751 10,548 134 76,616 I EXCESS (DEFICIENCY) OF REVENUE OVER EXPENDITURES (14,655) 4,853 11,823 (15,131) I OTHER FINANCING SOURCES (USES) Proceeds from sale of bonds I Operating transfers in 35,000 185,000 70,800 200,000 Operating transfers out TOTAL OTHER FINANCING I SOURCES (USES) 35,000 185,000 70,800 200,000 EXCESS (DEFICIENCY) OF REVENUE AND OTHER I FINANCING SOURCES OVER EXPENDITURES AND OTHER FINANCING USES 20,345 189,853 82,623 184,869 FUND BALANCE (DEFICIT), JANUARY 1 59,277 (94,160) 282,265 1,543,805 I RESIDUAL EQUITY TRANSFER OUT I FUND BALANCE, DECEMBER 31 $ 79,622 $ 95,693 $ 364,888 $ 1,728,674 -39- I I I I I I I CITY OF SHOREWOOD, MINNESOTA I ENTERPRISE FUNDS I Enterprise funds are used to account for operations that are fmanced and operated in a manner similar to private business, where the costs of providing services to the general public are financed primarily through user charges. I Water Fund - This fund is used to account for the activities of the City water system and to service debt incurred in the building of infrastructure for the system. Sewer Fund - This fund is used to account for the activities of the City sanitary sewer system. I Recvclinl! Fund - This fund is used to account for the activities of the City recycling program. I Stormwater Manal!ement Utility Fund - This fund is used to account for the activities of the City Stormwater Management system. I Liquor Fund - This fund is used to account for the activities of the City's off-sale liquor operation. The operation consisted of three off-sale liquor store sites in 2002. A portion of the net income generated by the operation, if any, is used to fund general fund activities. I I I I I I I I CITY OF SHOREWOOD, MINNESOTA ENTERPRISE FUNDS I COMBINING BALANCE SHEET DECEMBER 31, 2002 (With comparative totals for December 31, 2001) I Stormwater Management Water Sewer Recycling Utility I ASSETS CURRENT ASSETS Cash and temporary investments $ 1,480,865 $ 2,823,305 $ 41,457 $ 173,094 I Receivables Accrued interest 8,499 11,515 215 768 Accounts 50,691 183,248 15,026 69,595 I Special assessments Delinquent 4,286 5,955 618 443 Deferred 392,531 7,644 941 1,348 Due from other funds 180,000 I Inventories, at cost Prepaid items 5,262 2,867 TOTAL CURRENT ASSETS 1,942,134 3,214,534 58,257 245,248 I FIXED ASSETS, AT COST 6,877 ,436 7,928,803 1,197,705 LESS ACCUMULATED DEPRECIATION (1,734,526) (5,310,416) (10,746) I NET FIXED ASSETS 5,142,910 2,618,387 1,186,959 OTHER ASSETS I Bond discount, net of amortization 13,068 TOTAL ASSETS $ 7,098,112 $ 5,832,921 $ 58,257 $ 1,432,207 I LIABILITIES AND FUND EQUITY CURRENT LIABILITIES Accounts and contracts payable $ 10,309 $ 21 ,316 $ 205 $ 205 I Due to other funds 180,000 Due to other governments 3,373 15,444 Salaries and compensated absences payable 262 488 I Accrued interest payable 36,822 Deferred revenue 40,394 Current portion of long-term debt 185,000 I TOTAL CURRENT LIABILITIES 276,160 37,248 205 180,205 LONG-TERM LIABILITIES I Bonds payable less current portion above 1,545,000 TOTAL LIABILITIES 1,821,160 37,248 205 180,205 I FUND EQUITY Contributed capital 4,924,058 4,657,264 618,257 Retained earnings I Unreserved 352,894 1,138,409 58,052 633,745 TOTAL FUND EQUITY 5,276,952 5,795,673 58,052 1,252,002 I TOTAL LIABILITIES AND FUND EQUITY $ 7,098,112 $ 5,832,921 $ 58,257 $ 1,432,207 -41- I CITY OF SHOREWOOD, MINNESOTA I ENTERPRISE FUNDS I COMBINING STATEMENT OF REVENUE, EXPENSES AND CHANGES IN RETAINED EARNINGS YEAR ENDED DECEMBER 31,2002 (With comparative totals for the year ended December 31, 2001) I Stormwater Management Water Sewer Recycling Utility I OPERATING REVENUE Sales $ $ $ $ Less cost of sales I GROSS PROFIT Charges for services 270,875 690,150 81,860 43,985 I Permits and connection fees 16,590 8,302 GROSS PROFIT AND REVENUE 287,465 698,452 81,860 43,985 I OPERATING EXPENSES Personal services 48,430 32,068 498 2,298 Supplies 13,385 6,418 1,694 3,376 I Repairs and maintenance 14,811 14,915 Depreciation 180,805 202,291 4,376 Professional services 1,544 1,890 740 I Contracted services 80,925 49,099 102,382 5,820 Communication 1,551 Insurance 4,384 1,344 I Water purchases 11,863 Utilities 50,271 5,256 Disposal charges 354,887 Rent I Advertising Other 10,962 1,070 134 TOTAL OPERATING EXPENSES 417,380 669,238 104,708 18,161 I OPERATING INCOME (LOSS) (129,915) 29,214 (22,848) 25,824 NONOPERATING REVENUE (EXPENSES) I General property taxes Special assessments (1,204) I Interest on investments 60,512 109,107 1,655 5,576 Antenna lease 56,636 Other income (expense) 46,703 2,353 24,866 368 Interest expense (90,259) (9,863) I TOTAL NONOPERATING REVENUE (EXPENSES) 15,752 111,460 26,521 52,717 INCOME (LOSS) BEFORE TRANSFERS (114,163) 140,674 3,673 78,541 I OPERATING TRANSFERS IJ'.! 35,000 OPERATING TRANSFERS OUT (10,000) (15,000) I NET INCOME (LOSS) (124,163) 125,674 3,673 113,541 RETAINED EARNINGS, JANUARY 1 477,057 1,012,735 54,379 520,204 I RETAINED EARNINGS, DECEMBER 31 $ $ $ $ 352,894 1,138,409 58,052 633,745 -43- I I CITY OF SHOREWOOD, MINNESOTA ENTERPRISE FUNDS I COMBINING STATEMENT OF CASH FLOWS YEAR ENDED DECEMBER 31, 2002 (With comparative totals for the year ended December 31, 2001) Stormwater I Management Water Sewer Recycling Utility I CASH FLOWS FROM OPERATING ACTIVITIES Operating income (loss) $ (129,915) $ 29,214 $ (22,848) $ 25,824 Adjustments to reconcile operating income (loss) to I net cash provided (used) by operating activities: Other income related to operations 46,703 2,353 24,866 57,004 Depreciation 180,805 202,291 4,376 Amortization 1,403 I (Increase) decrease in assets: Accounts receivable 17,453 (10,731) (148) (56,572) Special assessments receivable 7,623 157 556 Inventories I Prepaid items 3,947 29,198 Increase (decrease) in liabilities: Accounts payable (54,609) 5,523 205 (3,689) I Due to other governments 3,373 15,444 Salaries and compensated absences payable 262 488 NET CASH PROVIDED (USED) I BY OPERATING ACTIVITIES 69,422 281,403 2,232 27,499 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES (Increase) decrease in due from other funds 427,039 I Operating transfers in 35,000 Property taxes collected Interest paid on interfund loan (9,863) I Increase (decrease) in due to other funds (20,000) Operating transfers out (10,000) (15,000) NET CASH PROVIDED (USED) I BY NONCAPITAL FINANCING ACTIVITIES (10,000) 412,039 5,137 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES I Principal paid on revenue bonds (185,000) Interest paid on revenue bonds (93,280) Acquisition of fixed assets (935) Proceeds from sale of fixed assets I Special assessments collected 149,208 Other income from capital and related financing activities NET CASH USED BY CAPITAL I AND RELATED FINANCING ACTIVITIES (130,007) CASH FLOWS FROM INVESTING ACTIVITIES Interest received on investments 56,642 103,856 1 ,440 5,353 I INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (13,943) 797,298 3,672 37,989 CASH AND CASH EQUIVALENTS, JANUARY 1 1,494,808 2,026,007 37,785 135,105 I CASH AND CASH EQUIVALENTS, DECEMBER 31 $ 1,480,865 $ 2,823,305 $ 41,457 $ 173,094 NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES Fixed assets contributed by other funds $ $ $ $ 143,489 I Retirement of fixed assets $ $ $ $ -45- I I CITY OF SHOREWOOD, MINNESOTA Exhibit D-4 WATER FUND I COMP ARA TIVE BALANCE SHEETS DECEMBER 31,2002 AND 2001 2002 2001 I ASSETS CURRENT ASSETS I Cash and temporary investments $ 1,480,865 $ 1,494,808 Receivables Accrued interest 8,499 4,629 I Accounts 50,691 68,144 Special assessments Delinquent 4,286 6,064 I Deferred 392,531 500,771 Prepaid items 5,262 9,209 TOTAL CURRENT ASSETS 1,942,134 2,083,625 I FIXED ASSETS, AT COST 6,877,436 6,876,501 LESS ACCUMULATED DEPRECIATION (1,734,526) (1,553,721) I NET FIXED ASSETS 5,142,910 5,322,780 OTHER ASSETS I Bond discount, net of amortization 13,068 14,471 TOTAL ASSETS $ 7,098,112 $ 7,420,876 I LIABILITIES AND FUND EQUITY I CURRENT LIABILITIES Accounts and contracts payable $ 10,309 $ 64,918 Due to other governments 3,373 I Accrued interest payable 36,822 39,843 Salaries and compensated absences payable 262 Deferred revenue 40,394 I Current portion of long-term debt 185,000 185,000 TOTAL CURRENT LIABILITIES 276,160 289,761 I LONG -TERM LIABILITIES Bonds payable less current portion above 1,545,000 1,730,000 I TOTAL LIABILITIES 1,821,160 2,019,761 FUND EQUITY I Contributed capital 4,924,058 4,924,058 Retained earnings I Unreserved 352,894 477,057 TOTAL FUND EQUITY 5,276,952 5,401,115 I TOTAL LIABILITIES AND FUND EQUITY $ 7,098,112 $ 7,420,876 -47- I I CITY OF SHOREWOOD, MINNESOTA Exhibit D-S I WATER FUND COMPARATIVE STATEMENTS OF REVENUE, EXPENSES AND CHANGES IN RETAINED EARNINGS YEARS ENDED DECEMBER 31,2002 AND 2001 I 2002 2001 OPERATING REVENUE I Charges for services $ 270,875 $ 319,260 Permits and connection fees 16,590 79,295 I TOTAL OPERATING REVENUE 287,465 398,555 OPERATING EXPENSES I Personal services 48,430 17,830 Supplies 13,385 13,592 Repairs and maintenance 14,811 23,023 I Depreciation 180,805 178,328 Professional services 1,544 9,238 Contracted services 80,925 70,570 I Insurance 4,384 3,617 Water purchases 11,863 12,735 Utilities 50,271 50,612 Other 10,962 8,115 I TOTAL OPERATING EXPENSES 417,380 387,660 I OPERATING INCOME (LOSS) (129,915) 10,895 NONOPERATING REVENUE (EXPENSES) I General property taxes 18 Special assessments (1,204) 40,348 Interest on investments 60,512 63,712 I Other income 46,703 20,191 Interest expense (90,259) (140,985) I TOTAL NONOPERATING REVENUE (EXPENSES) 15,752 (16,716) LOSS BEFORE TRANSFERS (114,163) (5,821) I OPERATING TRANSFER OUT (10,000) (5,000) I NET LOSS (124,163) (10,821) RETAINED EARNINGS, JANUARY 1 477,057 487,878 I RETAINED EARNINGS, DECEMBER 31 $ 352,894 $ 477,057 I I I -48- I CITY OF SHOREWOOD, MINNESOTA Exhibit D-6 WATER FUND I COMPARATIVE STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31,2002 AND 2001 2002 2001 I CASH FLOWS FROM OPERATING ACTIVITIES Operating income (loss) $ (129,915) $ 10,895 I Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Other income related to operations 46,703 20,191 I Depreciation 180,805 178,329 Amortization 1,403 1,403 (Increase) decrease in assets: I Accounts receivable 17,453 (11,183) Prepaid items 3,947 (6,336) Increase (decrease) in liabilities: I Accounts and contracts payable (54,609) 34,817 Due to other governments 3,373 Salaries and compensated absences payable 262 (194) NET CASH PROVIDED BY OPERATING ACTIVITIES 69,422 227,922 I CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES I Operating transfers to other funds (10,000) (5,000) Property taxes collected 53 NET CASH USED BY NONCAPITAL FINANCING ACTIVITIES (10,000) (4,947) I CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES I Bond principal paid (185,000) (185,000) Interest paid on revenue bonds (93,280) (101,142) Acquisition of fixed assets (935) (68,488) I Special assessments collected 149,208 130,437 NET CASH USED BY CAPITAL I AND RELATED FINANCING ACTIVITIES (130,007) (224,140) CASH FLOWS FROM INVESTING ACTIVITIES I Interest received on investments 56,642 67,778 INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (13,943) 66,560 I CASH AND CASH EQUIVALENTS, JANUARY 1 1,494,808 1,428,248 CASH AND CASH EQUIVALENTS, DECEMBER 31 $ 1,480,865 $ 1,494,808 I I I -49- I I CITY OF SHOREWOOD, MINNESOTA Exhibit D-7 I SEWER FUND COMPARATIVE BALANCE SHEETS DECEMBER 31,2002 AND 2001 I 2002 2001 ASSETS I CURRENT ASSETS Cash and temporary investments $ 2,823,305 $ 2,026,007 Receivables I Accrued interest 11,515 6,263 Accounts 183,248 172,518 Special assessments I Delinquent 5,955 3,246 Deferred 7,644 17,976 Due from other funds 180,000 607,039 I Prepaid items 2,867 32,065 TOTAL CURRENT ASSETS 3,214,534 2,865,114 I FIXED ASSETS, AT COST 7,928,803 7,928,803 LESS ACCUMULATED DEPRECIATION (5,310,416) (5,108,125) I NET FIXED ASSETS 2,618,387 2,820,678 TOTAL ASSETS $ 5,832,921 $ 5,685,792 I LIABILITIES AND FUND EQUITY CURRENT LIABILITIES I Accounts and contracts payable $ 21,316 $ 15,793 Due to other governments 15,444 Salaries and compensated absences payable 488 I TOTAL CURRENT LIABILITIES 37,248 15,793 I FUND EQUITY Contributed capital 4,657,264 4,657,264 Retained earnings I Unreserved 1,138,409 1,012,735 TOTAL FUND EQUITY 5,795,673 5,669,999 I TOTAL LIABILITIES AND FUND EQUITY $ 5,832,921 $ 5,685,792 I I I I -50- CITY OF SHOREWOOD, MINNESOTA Exhibit D-8 SEWER FUND COMPARATIVE STATEMENTS OF REVENUE, EXPENSES AND CHANGES IN RETAINED EARNINGS YEARS ENDED DECEMBER 31,2002 AND 2001 2002 2001 OPERATING REVENUE Charges for services $ 690,150 $ 666,987 Permits and connection fees 8,302 13,547 TOTAL OPERATING REVENUE 698,452 680,534 OPERATING EXPENSES Personal services 32,068 18,795 Supplies 6,418 1,300 Repairs and maintenance 14,915 7,345 Depreciation 202,291 200,821 Professional services 1,890 4,274 Contracted services 49,099 43,132 Insurance 1,344 1,414 Utilities 5,256 5,065 MCES charges 339,960 374,980 Excelsior sewer charges 14,927 14,558 Other 1,070 3,437 TOTAL OPERATING EXPENSES 669,238 675,121 OPERATING INCOME 29,214 5,413 NONOPERATING REVENUE Interest on investments 109,107 108,409 Other income 2,353 TOTAL NONOPERATING REVENUE 111,460 108,409 INCOME BEFORE TRANSFERS 140,674 113,822 OPERATING TRANSFER OUT (15,000) (10,000) NET INCOME 125,674 103,822 RETAINED EARNINGS, JANUARY 1 1,012,735 908,913 RETAINED EARNINGS, DECEMBER 31 $ 1,138,409 $ 1,012,735 -51- I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA Exhibit D-9 SEWER FUND COMPARATIVE STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31,2002 AND 2001 2002 2001 CASH FLOWS FROM OPERATING ACTIVITIES Operating income $ 29,214 $ 5,413 Adjustments to reconcile operating income to net cash provided by operating activities: Other income related to operations 2,353 Depreciation 202,291 200,821 (Increase) decrease in assets: Accounts receivable (10,731) 20,826 Special assessments receivable 7,623 12,668 Prepaid items 29,198 (30,882) Increase (decrease) in liabilities: Accounts and contracts payable 5,523 11,584 Due to other governments 15,444 Salaries and compensated absences payable 488 (27) NET CASH PROVIDED BY OPERATING ACTIVITIES 281,403 220,403 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES (Increase) decrease in due from other funds 427,039 (42,039) Operating transfers out (15,000) (10,000) NET CASH PROVIDED (USED) BY NONCAPITAL FINANCING ACTIVITIES 412,039 (52,039) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition of fixed assets (14,680) CASH FLOWS FROM INVESTING ACTIVITIES Interest received on investments 103,856 113,671 INCREASE IN CASH AND CASH EQUIVALENTS 797,298 267,355 CASH AND CASH EQUIVALENTS, JANUARY 1 2,026,007 1,758,652 CASH AND CASH EQUIVALENTS, DECEMBER 31 $ 2,823,305 $ 2,026,007 -52- ASSETS CURRENT ASSETS Cash and temporary investments Receivables Accrued interest Accounts Special assessments Delinquent Deferred TOTAL ASSETS CITY OF SHOREWOOD, MINNESOTA RECYCLING FUND COMPARATIVE BALANCE SHEETS DECEMBER 31, 2002 AND 2001 LIABILITIES AND RETAINED EARNINGS CURRENT LIABILITIES Accounts and contracts payable RETAINED EARNINGS Unreserved TOTAL RETAINED EARNINGS -53- I Exhibit D-IO I 2002 2001 I $ 41,457 $ 37,785 I 215 15,026 14,878 I 618 310 941 1,406 I $ 58,257 $ 54,379 I $ 205 $ I 58,052 54,379 I $ 58,257 $ 54,379 I I I I I I I I I I I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA Exhibit D-ll RECYCLING FUND COMPARATIVE STATEMENTS OF REVENUE, EXPENSES AND CHANGES IN RETAINED EARNINGS YEARS ENDED DECEMBER 31,2002 AND 2001 2002 2001 OPERATING REVENUE Charges for services $ 81,860 $ 77,600 OPERATING EXPENSES Personal services 498 652 Supplies 1,694 983 Contracted service 102,382 102,376 Other 134 140 TOTAL OPERATING EXPENSES 104,708 104,151 OPERATING LOSS (22,848) (26,551 ) NONOPERATING REVENUE County recycling grant 23,690 23,728 Interest on investments 1,655 1,626 Other 1,176 392 TOTAL NONOPERATING REVENUE 26,521 25,746 NET INCOME (LOSS) 3,673 (805) RETAINED EARNINGS, JANUARY 1 54,379 55,184 RETAINED EARNINGS, DECEMBER 31 $ 58,052 $ 54,379 -54- CITY OF SHOREWOOD, MINNESOTA Exhibit D-12 RECYCLING FUND COMPARATIVE STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31,2002 AND 2001 2002 2001 CASH FLOWS FROM OPERATING ACTIVITIES Operating loss $ (22,848) $ (26,551 ) Adjustments to reconcile operating loss to net cash provided (used) by operating activities: County recycling grant 23,690 23,728 Other income related to operations 1,176 392 (Increase) decrease in assets: Accounts receivable (148) 144 Special assessments receivable 157 2,305 Increase (decrease) in liabilities: Accounts payable 205 (33) NET CASH USED BY OPERATING ACTIVITIES 2,232 (15) CASH FLOWS FROM INVESTING ACTIVITIES Interest received on investments 1,440 1,825 INCREASE IN CASH AND CASH EQUIVALENTS 3,672 1,810 CASH AND CASH EQUIVALENTS, JANUARY 1 37,785 35,975 CASH AND CASH EQUIVALENTS, DECEMBER 31 $ 41,457 $ 37,785 -55- I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA Exhibit D-13 STORMW ATER MANAGEMENT UTILITY FUND COMP ARA TIVE BALANCE SHEETS DECEMBER 31,2002 AND 2001 2002 2001 ASSETS CURRENT ASSETS Cash and investments $ 173,094 $ 135,105 Receivables Accrued interest 768 545 Accounts 69,595 13,023 Special assessments Delinquent 443 306 Deferred 1,348 2,041 TOTAL CURRENT ASSETS 245,248 151,020 FIXED ASSETS, AT COST 1,197,705 1,054,216 LESS ACCUMULATED DEPRECIATION (10,746) (6,370) NET FIXED ASSETS 1,186,959 1,047,846 TOTAL ASSETS $ 1,432,207 $ 1,198,866 LIABILITIES AND FUND EQUITY LIABILITIES Accounts payable $ 205 $ 3,894 Due to other funds 180,000 200,000 TOTAL CURRENT LIABILITIES 180,205 203,894 FUND EQUITY Contributed capital 618,257 474,768 Retained earnings Umeserved 633,745 520,204 TOTAL FUND EQUITY 1,252,002 994,972 TOTAL LIABILITIES AND FUND EQUITY $ 1,432,207 $ 1,198,866 -56- CITY OF SHOREWOOD, MINNESOTA Exhibit D-14 I STORMW A TER MANAGEMENT UTILITY FUND I COMPARATIVE STATEMENTS OF REVENUE, EXPENSES AND CHANGES IN RETAINED EARNINGS YEARS ENDED DECEMBER 31,2002 AND 2001 2002 2001 I OPERATING REVENUE Charges for services $ 43,985 $ 48,425 I OPERATING EXPENSES Personal services 2,298 2,473 Supplies 3,376 600 I Depreciation 4,376 5,276 Professional services 740 28,251 Contracted services 5,820 4,415 I Other 1,551 6,457 TOTAL OPERATING EXPENSES 18,161 47,472 I OPERATING INCOME 25,824 953 NONOPERATING REVENUE (EXPENSES) I Interest on investments 5,576 5,043 Antenna lease 56,636 I Other income 368 200,048 Interest expense (9,863) ( 6,768) TOTAL NONOPERATING REVENUE (EXPENSES) 52,717 198,323 I INCOME BEFORE OPERATING TRANSFERS 78,541 199,276 I OPERATING TRANSFER FROM OTHER FUNDS 35,000 10,000 NET INCOME 113,541 209,276 I RETAINED EARNINGS, JANUARY 1 520,204 310,928 I RETAINED EARNINGS, DECEMBER 31 $ 633,745 $ 520,204 I I I I I -57- I I CITY OF SHOREWOOD, MINNESOTA Exhibit D-15 I STORMW ATER MANAGEMENT UTILITY FUND COMPARATIVE STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31,2002 AND 2001 I 2002 2001 CASH FLOWS FROM OPERATING ACTIVITIES I Operating income $ 25,824 $ 953 Adjustments to reconcile operating income to net cash provided by operating activities: I Antenna lease 56,636 Other income related to operations 368 200,048 Depreciation 4,376 5,276 I (Increase) decrease in assets: Accounts receivable (56,572) 936 Special assessments receivable 556 (738) I Increase (decrease) in liabilities: Accounts payable (3,689) 3,826 NET CASH PROVIDED BY OPERATING ACTIVITIES 27,499 210,301 I CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Operating transfers from other funds 35,000 10,000 I Interest paid on interfund loan (9,863) (6,768) Decrease in due to other funds (20,000) (200,000) I NET CASH PROVIDED (USED) BY NONCAPITAL FINANCING ACTIVITIES 5,137 (196,768) I CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition of fixed assets (2,700) I CASH FLOWS FROM INVESTING ACTIVITIES Interest on investments 5,353 6,229 I INCREASE IN CASH AND CASH EQUIVALENTS 37,989 17,062 CASH AND CASH EQUIVALENTS, JANUARY 1 135,105 118,043 I CASH AND CASH EQUIVALENTS, DECEMBER 31 $ 173,094 $ 135,105 I SCHEDULE OF NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES Fixed assets acquired from other funds $ 143,489 $ 474,768 I I I I -58- CITY OF SHOREWOOD, MINNESOTA LIQUOR FUND COMP ARA TIVE BALANCE SHEETS DECEMBER 31,2002 AND 2001 ASSETS CURRENT ASSETS Cash and temporary investments Receivables Accrued interest Accounts receivable Inventories Prepaid items TOTAL CURRENT ASSETS FIXED ASSET, AT COST LESS ACCUMULATED DEPRECIATION NET FIXED ASSETS TOTAL ASSETS LIABILITIES AND RETAINED EARNINGS CURRENT LIABILITIES Accounts and contracts payable Salaries and compensated absences payable Due to other governments TOTAL CURRENT LIABILITIES RETAINED EARNINGS Unreserved TOTAL LIABILITIES AND RETAINED EARNINGS -59- I Exhibit D-16 I 2002 2001 I $ 473,518 $ 288,776 I 2,751 1,634 I 2,682 7,199 253,460 282,408 10,818 12,297 I 743,229 592,314 102,366 127,740 I (61,529) (77,279) 40,837 50,461 I $ 784,066 $ 642,775 I $ 88,199 $ 48,379 I 14,694 10,712 14,628 24,072 117,521 83,163 I 666,545 559,612 I $ 784,066 $ 642,775 I I I I I I I I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA Exhibit D-17 LIQUOR FUND COMPARATIVE STATEMENTS OF REVENUE, EXPENSES AND CHANGES IN RETAINED EARNINGS YEARS ENDED DECEMBER 31,2002 AND 2001 2002 2001 OPERATING REVENUE Sales Less cost of sales $ 2,507,191 (1,829,852) $ 2,629,590 (1,962,100) TOTAL OPERATING REVENUE 677,339 667,490 OPERATING EXPENSES Personal services Supplies Depreciation Professional services Contracted services Insurance Utilities Rent Advertising Other 294,486 290,934 12,961 12,911 10,085 9,662 7,756 5,307 2,221 2,962 13,511 12,597 24,524 24,308 149,172 167,433 7,694 10,374 31,535 45,694 553,945 582,182 123,394 85,308 13,220 17,251 319 (9,509) 13,539 7,742 136,933 93,050 (30,000) (10,000) 106,933 83,050 559,612 476,562 $ 666,545 $ 559,612 TOTAL OPERATING EXPENSES OPERATING INCOME NONOPERATING REVENUE (EXPENSES) Interest on investments Other income (expense) TOTAL NONOPERATING REVENUE (EXPENSES) INCOME BEFORE TRANSFERS OPERATING TRANSFERS TO OTHER FUNDS NET INCOME RETAINED EARNINGS, JANUARY 1 RETAINED EARNINGS, DECEMBER 31 -60- I CITY OF SHOREWOOD, MINNESOTA Exhibit D-18 I LIQUOR FUND COMP ARA TIVE STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31,2002 AND 2001 I 2002 2001 CASH FLOWS FROM OPERATING ACTIVITIES I Operating income $ 123,394 $ 85,308 Adjustments to reconcile operating income to net cash provided by operating activities: I Other income (expense) related to operations 19 (9,509) Depreciation 10,085 9,662 (Increase) decrease in assets: I Accounts receivable 4,517 (7,199) Inventories 28,948 34,707 Prepaid items 1,479 (2,284) I Increase (decrease) in liabilities: Accounts and contracts payable 39,820 39,340 Due to other governments (9,444) I Salaries and compensated absences payable 3,982 (7,167) NET CASH PROVIDED BY OPERATING ACTIVITIES 202,800 142,858 I CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Operating transfers out (30,000) (10,000) I CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition of fixed assets (7,830) (14,194) Proceeds from sale of fixed assets 7,669 I NET CASH USED BY CAPITAL AND RELATED FINANCING ACTIVITIES (161) (14,194) I CASH FLOWS FROM INVESTING ACTIVITIES Interest received on investments 12,103 17,600 I INCREASE IN CASH AND CASH EQUIVALENTS 184,742 136,264 CASH AND CASH EQUIVALENTS, JANUARY 1 288,776 152,512 I CASH AND CASH EQUIVALENTS, DECEMBER 31 $ 473,518 $ 288,776 I SCHEDULE OF NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES Retirement of fixed assets $ 33,204 $ I I I I -61- CITY OF SHOREWOOD, MINNESOTA LIQUOR FUND COMBINING BALANCE SHEETS DECEMBER 31,2002 AND 2001 Tanka Bay 2002 2001 ASSETS CURRENT ASSETS Cash and temporary investments (deficit) $ 258,256 $ 148,782 Receivables Accrued interest 842 545 Accounts 2,682 Inventories, at cost 73,108 Prepaid items 4,987 TOTAL CURRENT ASSETS 261,780 227,422 FIXED ASSETS, AT COST 12,715 LESS ACCUMULATED DEPRECIATION (3,303) NET FIXED ASSETS 9,412 TOTAL ASSETS $ 261,780 $ 236,834 LIABILITIES AND RETAINED EARNINGS (DEFICIT) CURRENT LIABILITIES Accounts and contracts payable $ 20,642 $ 19,380 Due to other governments 6,697 Salaries and compensated absences payable (14) 1,804 TOTAL LIABILITIES 20,628 27,881 RETAINED EARNINGS (DEFICIT) Umeserved 241,152 208,953 TOTAL LIABILITIES AND RETAINED EARNINGS (DEFICIT) $ 261,780 $ 236,834 -62- I I I I I I I I I I I I I I I I I I I I Exhibit D-19 I I Waterford Center Shorewood Plaza Totals 2002 2001 2002 2001 2002 2001 I $ (167,065) $ (196,276) $ 382,327 $ 336,270 $ 473,518 $ 288,776 I 1,909 1,089 2,751 1,634 7,199 2,682 7,199 I 106,372 101,739 147,088 107,561 253,460 282,408 5,386 3,181 5,432 4,129 10,818 12,297 I (55,307) (91,356) 536,756 456,248 743,229 592,314 66,134 77,822 36,232 37,203 102,366 127,740 I (43,164) (49,998) (18,365) (23,978) (61,529) (77,279) 22,970 27,824 17,867 13 ,225 40,837 50,461 I $ (32,337) $ (63,532) $ 554,623 $ 469,473 $ 784,066 $ 642,775 I $ 31,674 $ 10,167 $ 35,883 $ 18,832 $ 88,199 $ 48,379 I 6,627 6,266 8,001 11,109 14,628 24,072 5,616 1,271 9,092 7,637 14,694 10,712 43,917 17,704 52,976 37,578 117,521 83,163 I (76,254) (81,236) 501,647 431,895 666,545 559,612 I $ (32,337) $ (63,532) $ 554,623 $ 469,473 $ 784,066 $ 642,775 I I I I I I -63- I CITY OF SHOREWOOD, MINNESOTA LIQUOR FUND I COMBINING SCHEDULES OF REVENUE, EXPENSES AND CHANGES IN RETAINED EARNINGS (DEFICIT) YEARS ENDED DECEMBER 31, 2002 AND 2001 Tonka Bay I 2002 2001 OPERATING REVENUE I Sales $ 727,938 $ 768,232 Less cost of goods sold (539,749) (586,654) GROSS PROFIT 188,189 181,578 I OPERATING EXPENSES I Personal services 92,290 100,486 Supplies 3,251 4,300 Depreciation 2,043 2,043 Professional services 2,453 1,733 I Contracted services 793 1,774 Insurance 4,910 5,578 Utilities 7,894 8,037 I Rent 23,773 24,584 Advertising 1,484 2,864 Other 9,000 12,825 I TOTAL OPERATING EXPENSES 147,891 164,224 OPERATING INCOME 40,298 17,354 I NONOPERATING REVENUE (EXPENSES) I Interest on investments 6,601 5,855 Other income (expense) 300 TOTAL NONOPERATING I REVENUE (EXPENSES) 6,901 5,855 INCOME BEFORE TRANSFERS 47,199 23,209 I OPERATING TRANSFERS TO OTHER FUNDS (15,000) (5,000) I 32,199 18,209 NET INCOME RETAINED EARNINGS (DEFICIT), JANUARY 1 208,953 190,744 I RETAINED EARNINGS (DEFICIT), DECEMBER 31 $ 241,152 $ 208,953 I I I -64- I I Exhibit D-20 I I Waterford Center Shorewood Plaza Totals 2002 2001 2002 2001 2002 2001 I $ 792,379 $ 774,745 $ 986,874 $ 1,086,613 $ 2,507,191 $ 2,629,590 (575,758) (562,372) (714,345) (813,074) (1,829,852) (1,962,100) I 216,621 212,373 272,529 273,539 677,339 667,490 I 97,523 73,187 104,673 117,261 294,486 290,934 4,745 3,878 4,965 4,733 12,961 12,911 I 4,854 5,771 3,188 1,848 10,085 9,662 3,025 1,841 2,278 1,733 7,756 5,307 479 636 949 552 2,221 2,962 I 4,292 3,500 4,309 3,519 13,511 12,597 7,801 7,991 8,829 8,280 24,524 24,308 68,428 86,114 56,971 56,735 149,172 167,433 I 3,695 4,064 2,515 3,446 7,694 10,374 10,615 14,576 11,920 18,293 31,535 45,694 I 205,457 201,558 200,597 216,400 553,945 582,182 11,164 10,815 71,932 57,139 123,394 85,308 I (6,201) 12,820 11,396 13,220 17,251 19 (9,509) 319 (9,509) I (6,182) (9,509) 12,820 11,396 13,539 7,742 I 4,982 1,306 84,752 68,535 136,933 93,050 I (15,000) (5,000) (30,000) (10,000) 4,982 1,306 69,752 63,535 106,933 83,050 I (81,236) (82,542) 431,895 368,360 559,612 476,562 I $ (76,254) $ (81,236) $ 501,647 $ 431,895 $ 666,545 $ 559,612 I I I -65- CITY OF SHOREWOOD, MINNESOTA I LIQUOR FUND I COMBINING SCHEDULES OF CASH FLOWS YEARS ENDED DECEMBER 31,2002 AND 2001 Tonka Bay I 2002 2001 CASH FLOWS FROM OPERATING ACTIVITIES I Operating income $ 40,298 $ 17,354 Adjustments to reconcile operating income to net cash provided by operating activities: I Other income (expense) related to operations Depreciation 2,043 2,043 (Increase) decrease in assets: I Accounts receivable (2,682) Inventories 73,108 9,078 Prepaid items 4,987 (652) Increase (decrease) in liabilities: I Accounts and contracts payable 1,262 8,333 Due to other governments (6,697) Salaries and compensated absences payable (1,818) (3,921 ) I NET CASH PROVIDED BY OPERATING ACTIVITIES 110,501 32,235 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES I Operating transfers out (15,000) (5,000) CASH FLOWS FROM CAPITAL AND RELATED I FINANCING ACTIVITIES Acquisition of fixed assets I Proceeds from sale of fixed assets 7,669 NET CASH PROVIDED (USED) I BY CAPITAL AND RELATED FINANCING ACTIVITIES 7,669 CASH FLOWS FROM INVESTING ACTIVITIES I Interest received on investments 6,304 5,947 INCREASE IN CASH AND CASH EQUIVALENTS 109,474 33,182 I CASH AND CASH EQUIVALENTS (DEFICIT), JANUARY 1 148,782 115,600 CASH AND CASH EQUIVALENTS (DEFICIT), DECEMBER 31 $ 258,256 $ 148,782 I SCHEDULE OF NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES I Retirement of fixed assets $ 12,715 $ I I -66- I I I I I I I CITY OF SHOREWOOD, MINNESOTA I GENERAL FIXED ASSETS ACCOUNT GROUP I General fixed assets are those fixed assets of a governmental jurisdiction, which are not accounted for in an enterprise fund. To be classified as a fixed asset in this category, a specific piece of property must meet three attributes: I 1. Tangible nature 2. A life longer than the current fiscal year 3. A significant value I I I I I I I I I I GENERAL FIXED ASSETS Land Buildings and structures Improvements other than buildings Furniture and equipment 2002 2001 $ 741,826 $ 456,826 1,731,011 1,731,011 1,391,881 1,383,936 1,559,797 1,547,678 $ 5,424,515 $ 5,119,451 I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA GENERAL FIXED ASSETS ACCOUNT GROUP COMPARATIVE SCHEDULES OF GENERAL FIXED ASSETS - BY SOURCE DECEMBER 31,2002 AND 2001 Exhibit E-l TOTAL GENERAL FIXED ASSETS INVESTMENT IN GENERAL FIXED ASSETS General fund Capital projects funds $ 1,500,363 3,924,152 $ 1,215,363 3,904,088 TOTAL INVESTMENT IN GENERAL FIXED ASSETS $ 5,424,515 $ 5,119,451 -68- I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA GENERAL FIXED ASSETS ACCOUNT GROUP SCHEDULE OF GENERAL FIXED ASSETS - BY FUNCTION AND ACTIVITY DECEMBER 31,2002 Exhibit E-2 Buildings Improvements Furniture and other than and Total Land Structures Buildings Equipment FUNCTION General government $ 734,105 $ $ 320,298 $ 161,504 $ 252,303 Public works 2,565,277 153,500 919,581 184,702 1,307,494 Culture and recreation 2,125,133 588,326 491,132 1,045,675 TOTAL GENERAL FIXED ASSETS $ 5,424,515 $ 741,826 $ 1,731,011 $ 1,391,881 $ 1,559,797 -69- CITY OF SHOREWOOD, MINNESOTA GENERAL FIXED ASSETS ACCOUNT GROUP SCHEDULE OF CHANGES IN GENERAL FIXED ASSETS - BY FUNCTION YEAR ENDED DECEMBER 31,2002 General Fixed Assets January 1 Additions General government $ 722,641 $ 25,234 Public works 2,564,622 655 Culture and recreation 1,832,188 292,945 TOTAL GENERAL FIXED ASSETS $ 5,119,451 $ 318,834 -70- Deductions $ 13,770 $ 13,770 Exhibit E-3 I I I I I I I I I I I I I I I I I I I General Fixed Assets December 31 $ 734,105 2,565,277 2,125,133 $ 5,424,515 I I I I I I CITY OF SHOREWOOD, MINNESOTA I GENERAL LONG-TERM DEBT ACCOUNT GROUP I General obligation bonds and other forms of long-term debt supported by general revenues are obligations of a governmental unit as a whole and not its individual constituent funds. The amount of outstanding long-term indebtedness which is backed by the full faith and credit of the government (excluding enterprise fund debt) is recorded and accounted for in a separate self-balancing account group titled the "General Long-Term Debt Account Group". Also, this debt group includes certain liabilities not expected to be liquidated with expendable available [mancial resources. I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA GENERAL LONG-TERM DEBT ACCOUNT GROUP COMPARATIVE STATEMENTS OF GENERAL LONG-TERM DEBT DECEMBER 31, 2002 AND 2001 2002 AMOUNT A V AILABLE FOR DEBT RETIREMENT Debt service funds $ 208,801 AMOUNTS TO BE PROVIDED FOR DEBT RETIREMENT Future tax levies, assessments and tax increments 10,034,868 TOTAL AMOUNT AVAILABLE AND TO BE PROVIDED FOR DEBT RETIREMENT $ 10,243,669 GENERAL LONG-TERM DEBT PAYABLE Compensated absences payable Capital lease payable Lease revenue bonds General obligation improvement bonds $ 68,034 185,635 9,950,000 40,000 TOTAL GENERAL LONG-TERM DEBT PAYABLE $ 10,243,669 -71- Exhibit F-1 2001 $ 231,421 190,035 $ 421,456 $ 55,988 210,468 155,000 $ 421,456 CITY OF SHOREWOOD, MINNESOTA SCHEDULE OF BONDS PAYABLE DECEMBER 31,2002 Final Interest Issue Maturity Rates Date Date 4.00-4.45 12-01-93 02-01-04 GENERAL OBLIGATION IMPROVEMENT BONDS G.O. Improvement Bonds of 1993 GENERAL OBLIGATION REVENUE BONDS G.O. Water Revenue Bonds of 1995 G.O. Water Revenue Bonds of 1996 4.45-4.75 4.45-5.40 11-01-95 11-01-96 TOTAL GENERAL OBLIGATION REVENUE BONDS LEASE REVENUE BONDS Public Safety Facility, Series 2002A Public Safety Facility, Series 2002B Public Safety Facility, Series 2002C 3.00-5.50 3.00-5.50 3.00-5.50 09-01-02 09-01-02 09-01-02 TOTAL LEASE REVENUE BONDS TOTAL ALL BONDS -72- 02-01-11 02-01-12 02-01-23 02-01-23 02-01-23 I I I I I I I I I I I I I I I I I I I I Exhibit F-2 I I Bonds Authorized 12/31/2002 and Issued Redeemed Outstanding I $ 325,000 $ 285,000 $ 40,000 I 1,920,000 765,000 1,155,000 860,000 285,000 575,000 I 2,780,000 1,050,000 1,730,000 I 3,865,000 3,865,000 4,025,000 4,025,000 I 2,060,000 2,060,000 9,950,000 9,950,000 I $ 13,055,000 $ 1,335,000 $ 11,720,000 I I I I I I I I I I -73- I CITY OF SHOREWOOD, MINNESOTA SCHEDULE OF DEBT SERVICE REQUIREMENTS I DECEMBER 31,2002 Total Bonds G.O. Improvement Bonds I Year Principal Interest Principal Interest 2003 $ 205,000 $ 532,039 $ 20,000 $ 1,430 I 2004 210,000 562,975 20,000 480 2005 525,000 548,474 2006 550,000 527,995 I 2007 550,000 505,100 2008 570,000 480,373 2009 580,000 454,035 2010 605,000 426,083 I 2011 615,000 396,760 2012 515,000 369,436 2013 475,000 345,370 I 2014 500,000 321,233 2015 525,000 295,476 2016 555,000 268,068 I 2017 580,000 238,980 2018 605,000 208,315 2019 640,000 175,785 I 2020 670,000 141,230 2021 705,000 104,088 2022 750,000 64,075 I 2023 790,000 21,723 TOTAL $ 11,720,000 $ 6,987,613 $ 40,000 $ 1,910 I I I I I I I I -74- I I Exhibit F-3 I I G.O. Revenue Bonds Lease Revenue Bonds Principal Interest Principal Interest I $ 185,000 $ 82,904 $ $ 447,705 190,000 74,090 488,405 180,000 65,244 345,000 483,230 I 190,000 56,240 360,000 471,755 185,000 46,945 365,000 458,155 185,000 37,603 385,000 442,770 I 185,000 28,040 395,000 425,995 190,000 18,115 415,000 407,968 180,000 8,135 435,000 388,625 I 60,000 1,622 455,000 367,814 475,000 345,370 500,000 321,233 I 525,000 295,476 555,000 268,068 580,000 238,980 I 605,000 208,315 640,000 175,785 670,000 141,230 705,000 104,088 I 750,000 64,075 790,000 21,723 I $ 1,730,000 $ 418,938 $ 9,950,000 $ 6,566,765 I I I I I I I I -75- I I I I I I I I I I I I I I I . . CITY OF SHOREWOOD, MINNESOTA SECTION IV STATISTICAL SECTION I I I CITY OF SHOREWOOD, MINNESOTA Table 1 GENERAL FUND EXPENDITURES AND OTHER USES BY FUNCTION LAST TEN FISCAL YEARS Culture Fiscal Total General Public Public and Mise.! Debt Year Expenditures Government Safety Works Recreation Transfers Service 1993 $ 2,184,260 $ 668,410 $ 580,153 $ 436,224 $ 119,473 $ 380,000 $ 1994 2,536,943 755,097 618,047 433,699 128,600 601,500 1995 2,326,231 723,098 650,703 432,759 115,446 404,225 1996 2,479,151 782,466 689,904 472,607 109,988 424,186 1997 2,614,217 821,257 744,072 451,756 115,193 444,395 37,544 1998 2,891,689 961,340 788,253 505,240 110,287 489,025 37,544 1999 2,721,371 851,627 799,515 425,450 114,435 492,800 37,544 2000 2,921,715 989,082 827,483 436,915 135,891 494,800 37,544 2001 3,073,887 996,042 893,070 487,092 126,139 534,000 37,544 2002 3,550,223 1,013,522 1,009,079 429,185 451,793 609,100 37,544 -76- I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I Fiscal Year CITY OF SHOREWOOD, MINNESOTA Table 2 GENERAL FUND REVENUE AND OTHER SOURCES BY SOURCE LAST TEN FISCAL YEARS Total General Licenses Fund and Inter - Mise.! Revenues Taxes Permits Governmental Fines Transfers $ 2,429,910 $ 1,515,633 $ 247,557 $ 426,102 $ 70,135 $ 170,483 2,531,339 1,487,398 256,243 441,040 73,998 272,660 2,378,009 1,489,822 184,857 440,720 68,765 193,845 2,457,755 1,569,653 205,459 427,468 80,826 174,349 2,670,175 1,703,509 236,672 450,185 76,340 203,469 2,770,825 1,776,853 223,248 532,359 73,337 165,028 2,829,676 1,870,727 221,555 468,969 94,115 174,310 3,104,544 1,938,705 346,086 485,046 76,483 258,224 3,347,776 2,206,525 349,515 497,269 61,243 233,224 3,685,133 2,658,663 229,234 171,783 89,632 535,821 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 -77- I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA Table 3 PROPERTY TAX LEVIES AND COLLECTIONS LAST TEN FISCAL YEARS (1) Percent Collection Percentage Collection of Total Fiscal Total of Current of Levy of Prior Total Collections Year Levy Year's Levy Collected Year's Levy Collections to Levy 1993 1,932,454 $ 1,908,428 98.76 % $ 51 ,464 $ 1,959,892 101.42 % 1994 1,518,735 1,505,212 99.11 13,886 1,519,098 100.02 1995 1,518,108 1,501,389 98.90 13,999 1,515,388 99.82 1996 1,598,713 1,577,353 98.66 16,946 1,594,299 99.72 1997 1,703,016 1,683,193 98.84 19,982 1,703,175 100.01 1998 1,778,585 1,760,645 98.99 15,694 1,776,339 99.87 1999 1,860,507 1,845,191 99.18 22,439 1,867,630 100.38 2000 1,935,779 1,922,709 99.32 15,035 1,937,744 100.10 2001 2,208,574 2,188,665 99.10 14,813 2,203,478 99.77 2002 2,763,367 2,707,740 97.99 18,749 2,726,489 98.67 (1) Includes state paid property tax credits. Prior to 1994, tax levies included the amount of Homestead and Agriculture Credit Aid (HACA) to be received from the State. Legislation passed in 1993 required that, beginning with taxes levied for collection in 1994, tax levies shall be reported net of the HACA received from the State. As a result, the taxes levied more accurately relect the amount of taxation by the local government. -78- CITY OF SHOREWOOD, MINNESOTA ASSESSED V ALVA nON, TAX LEVIES AND TAX CAPACITY RATES (Shown by year of tax collectibility) (2) 2002 2001 2000 1999 Tax capacity $ 8,690,552 $ 11,344,958 $ 10,346,255 $ 9,663,252 Contribution to fiscal disparities pool (171,024) (253,832) (201,693) (203,942) Receivable from fiscal disparities pool 314,412 426,424 379,095 342,621 Tax increment (312,066) Taxable valuation/Total tax capacity $ 8,833,940 $ 11,517,550 $ 10,523,657 $ 9,489,865 Tax levies General $ 2,763,367 $ 2,208,574 $ 1,935,799 $ 1,860,507 Debt service Total $ 2,763,367 $ 2,208,574 $ 1,935,799 $ 1,860,507 Tax capacity rate General 31.923 % 19.208 % 18.340 % 19.573 % Debt service Total 31.923 % 19.208 % 18.340 % 19.573 % (1) The debt service levy includes $8,508 for 1996, $8,568 for 1995, $8,022 for 1994 and $8,526 for 1993 levied for the retirement of Storm Sewer District No.2 improvement bonds. Storm Sewer District No.2 was established by the City of Shorewood in 1991. This portion of the debt service tax levy is only levied within Storm Sewer District No.2 to retire the $31,000 bond issue used to finance the improvements within the district and is not reflected in the tax rates above. Table 5 reports the tax rate of this District separately. (2) Prior to 1994, tax levies included the amount of Homestead and Agriculture Credit Aid (HACA) to be received from the State. Legislation passed in 1993 required that, beginning with taxes levied for collection in 1994, tax levies shall be reported net of the HACA received from the State. As a result, the taxes levied more accurately reflect the amount of taxation by the local government. -79- I I I I I I I I I I I I I I I I I I I I Table 4 I I (2) (2) (2) (2) 1998 1997 1996 1995 1994 1993 $ 9,897,574 $ 9,901,879 $ 9,115,960 $ 8,045,468 $ 7,396,104 $ 7,092,917 I (214,901) (202,668) (178,279) (185,232) (205,973) (227,686) 337,116 350,823 332,110 310,337 375,309 396,081 (319,186) (294,512) (166,094) (22,195) (317) I $ 9,700,603 $ 9,755,522 $ 9,103,697 $ 8,148,378 $ 7,565,123 $ 7,261,312 I $ 1,778,585 $ 1,703,016 $ 1,573,930 $ 1,491,990 $ 1,491,888 $ 1,909,253 24,783 26,118 26,847 23,201 I $ 1,778,585 $ 1,703,016 $ 1,598,713 $ 1,518,108 $ 1,518,735 $ 1,932,454 I 18.317 % 17.479 % 17.252 % 18.256 % 19.655 % 20.638 % 0.179 0.215 0.249 0.159 I 18.317 % 17.479 % 17.431 % 18.471 % 19.904 % 20.797 % I I I I I I I I I I -80- CITY OF SHOREWOOD, MINNESOTA PROPERTY TAX CAPACITY RATES - DIRECT AND OVERLAPPING GOVERNMENTS (PER $1000 OF TAX CAPACITY IN 1992-2001) Year (1) Taxes School District Watershed District Payable City County No. 276 No. 277 No.3 No.4 1993 20.797 % 35.839 % 75.275 % 60.069 % 0.668 % 0.781 % 1994 19.904 37.441 77.323 67.785 0.334 0.707 1995 218.471 37.454 76.139 66.441 2.332 0.762 1996 17.431 37.27 76.34 62.418 (2) 1.533 0.864 1997 17.479 35.515 78.42 52.223 1.319 0.86 1998 18.317 38.386 76.408 59.701 0.66 0.843 1999 19.573 40.994 69.423 67.286 0.825 0.88 2000 18.34 39.655 59.565 57.711 0.525 0.866 2001 19.208 37.624 47.155 40.246 1.363 0.946 2002 31.923 50.607 24.215 20.758 1.236 1.616 (1) Includes vocational school (2) Includes market value levy of .077 -81- Misc. I I I I I I I I I I I I I I I I I I I 5.532 % 5.724 5.847 6.39 6.149 6.973 8.043 7.916 7.916 7.757 I Table 5 I I Totals School District No. 276 Watershed School District District I Storm No.4 No. 277 Sewer Watershed Watershed Sewer Watershed District District District District District I No.2 No.3 No.4 No.2 No.3 13.437 % 138.111 % 138.224 % 151.661 % 122.905 % I 15.495 140.726 141.099 156.594 131.188 15.353 140.243 138.673 154.026 130.545 13.956 138.964 138.295 152.251 125.042 138.882 138.423 138.423 112.685 I 140.744 140.927 140.927 124.037 138.858 138.913 138.913 136.721 126.001 126.342 126.342 124.147 I 112.966 112.549 112.549 106.057 115.738 116.118 116.118 112.281 I I I I I I I I I I I -82- Taxpayer Two S Properties Waterford Partners LLC James C. Akins Minnetonka Country Club Shorewood Village Shopping Center, Inc. First State Bank of Excelsior Thomas J. & Cynthia J. Redmond The Mary Sue Simon Qprt Russell & Luaina Hagen Lawrence B & Patricia A Reid CITY OF SHOREWOOD, MINNESOTA PRINCIPAL TAXPAYERS DECEMBER 31, 2002 Type of Business 2002 Tax Capacity ResidentiaVCommercial Commercial Residential Commercial Commercial Commercial Residential ResidentiaVLakeshore Residential ResidentiaVLakeshore $ 89,508 47,250 45,425 45,110 41,250 39,250 31,456 31,286 24,875 21,784 -83- Table 6 I I I I I I Percent of Total 1.01 % 0.53 0.51 0.51 0.47 0.44 0.36 0.36 0.28 0.25 I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA Table 7 SPECIAL ASSESSMENT LEVIES AND COLLECTIONS LAST TEN FISCAL YEARS Percent Collection Percentage Collection of Total Fiscal Total of Current of Levy of Prior Total Collections Year Levy Year's Levy Collected Year's Levy Collections to Levy 1993 231,800 $ 222,842 96.14 % $ 47,372 $ 270,214 116.57 % 1994 198,729 185,061 93.12 6,025 191,086 96.15 1995 170,157 159,018 93.45 12,896 171,914 101.03 1996 233,219 197,667 84.76 6,660 204,327 87.61 1997 223,274 204,178 91.45 17,545 221,723 99.31 1998 215,817 190,437 88.24 7,089 197,526 91.52 1999 185,174 172,344 93.07 41,897 214,241 115.70 2000 160,137 155,491 97.10 11,813 167,304 104.48 2001 138,271 133,808 96.78 20,195 154,003 111.3 8 2002 94,544 89,965 95.16 6,750 96,715 102.30 Prior to 1994, tax levies included the amount of Homestead and Agriculture Credit Aid (HACA) to be received from the State. Legislation passed in 1993 required that, beginning with taes levied for collection in 1994, tax levies shall be reported net of the HACA received from the State. As a result, the taxes levied more accurately re1ect the amount of taxation by the local government. -84- I Table 8 CITY OF SHOREWOOD, MINNESOTA COMPUTATION OF LEGAL DEBT MARGIN DECEMBER 31,2002 I Market Value I $816.662.700 Debt Limit: 2.0% of market value (Note A) Amount of Debt Applicable to Debt Limit: $ 16,333,254 I Total Bonded Debt Less, (Note B) Improvement Bonds Lease Revenue Bonds General Obligation Revenue Bonds Total Debt Applicable to Debt Limit $ 11,720,000 (40,000) (9,950,000 ) 0.730,000) I I Legal Debt Margin $ 16.333.254 Note (A): M.S.A. Section 475.53 (Limit on Net Debt) I (6) "Subdivision 1. Generally. Except as otherwise provided in sections 475.51 to 475.75, no municipality, except a school district or a city of the fIrst class, shall incur or be subject to a net debt in excess of 2.0 percent of the market value of taxable property in the municipality. " I Note (B): M.S.A. Section 162.18 (Bond: Municipal State Aid) I "Subdivision 2. Not included in net debt of municipality for purpose of any statutory or charter limitation. Obligations issued here under may be authorized by resolution of the governing body without authorization by the electors, and shall not be included in the net debt of the municipality for the purpose of any statutory or charter limitation on indebtedness." I M. S.A. Section 475.51 (DefInitions:) "Subdivision 4. 'Net Debt' means the amount remaining after deducting from its gross debt the aggregate of the principal of the I following: (1) I Obligations issued for improvements which are payable wholly or partly from the proceeds of special assessments levied upon property specially benefIted thereby, including those which are general obligations of the municipality issuing them, if the municipality is entitled to reimbursement in whole or in part from the proceeds of the special assessments. (2) (3) I I I Warrants or orders having no defInite or fIxed maturity. Obligations payable wholly from the income from revenue-producing conveniences. (4) (5) Obligations issued to create or maintain a permanent improvement revolving fimd. Obligations issued for the acquisition and betterment of public water works systems, and public lighting, heating or power systems and of any combination thereof, or for any other public convenience from which a revenue is or may be derived. Amount of all money and the face value of all securities held as a sinking fund for the extinguishment of obligations other than those deductible under this subdivision. I (7) I All other obligations, which under the provisions of the law authorizing their issuance, are not to be included in computing the net debt of the municipality." * After contribution and distribution from "fIscal disparity" legislation; Minnesota laws 1971, Extra Session, Chapter 24. I -85- I I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA RA no OF NET BONDED DEBT TO ASSESSED VALUE AND NET BONDED DEBT PER CAPITA LAST TEN FISCAL YEARS Table 9 Ratio of Less Net Bonded Amount Debt to (1) Reserved Assessed Net Gross for Net Values/ Bonded Fiscal Estimated Tax Bonded Debt Bonded Tax Debt Year Population Capacity Debt Service Debt Capacity Per Capita 1993 6,322 $ 7,261,312 $ 2,546,500 $ 1,999,197 $ 547,303 .0754:1 $ 86.57 1994 6,430 7,565,123 1,850,500 1,485,579 364,921 .0482: I 56.75 1995 6,614 8,148,378 3,524,500 1,419,732 2,104,768 .2583:1 318.23 1996 6,794 9,103,697 3,602,500 503,635 3,098,865 .3404:1 456.12 1997 6,889 9,755,522 3,335,000 478,192 2,856,808 .2928: 1 414.69 1998 6,955 9,700,603 3,015,000 424,978 2,590,022 .2670: 1 372.40 1999 7,008 9,489,865 2,700,000 376,643 2,323,357 .2448: 1 331.53 2000 7,400 10,218,346 2,380,000 303,858 2,076,142 .2032: 1 280.55 2001 7,400 11,344,958 2,070,000 231,421 1,838,579 .1621:1 248.46 2002 7,400 8,690,552 11,720,000 208,801 11,511,199 1.349:1 1,555.57 (1) Gross bonded debt amounts in this table are general obligation special assessment bonds and revenue bonds whose principal source of funding will be sources other than general property taxes. -86- CITY OF SHOREWOOD, MINNESOTA RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR GENERAL BONDED DEBT (1) TO TOTAL GENERAL EXPENDITURES* LAST TEN FISCAL YEARS Table 10 Total Percent of Total General Debt Service Fiscal Debt Fund to General Year Principal Interest Service Expenditures * Expenditures 1993 $ 264,500 $ 141,889 $ 406,389 $ 2,184,260 18.60 % 1994 681,000 (2) 120,862 801,862 2,536,943 31.61 1995 231,000 99,823 330,823 2,326,231 14.22 1996 767,000 (3) 72,461 839,461 2,479,151 33.86 1997 142,500 39,921 182,421 2,614,217 6.98 1998 135,000 33,099 168,099 2,891,689 5.81 1999 135,000 26,645 161,645 2,721,371 5.93 2000 130,000 18,588 148,588 2,921,715 5.09 2001 125,000 11,777 136,777 3,073,887 4.45 2002 115,000 6,133 121,133 3,550,223 3.41 (1) Excludes G.O. Bonds reported in Enterprise Funds (2) Principal included bonds called in 1994 (3) Principal included bonds called in 1996 * Includes General Fund only -87- I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA COMPUTATION OF DIRECT AND OVERLAPPING DEBT DECEMBER 31,2002 Table 11 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 $ 11,720,000 $ 11,511,199 100.00 % $ 11,511,199 Overlapping Debt Hennepin County 325,845,000 320,455,627 1.06 3,396,830 Hennepin Suburban Park District 29,335,000 25,281,217 1.52 384,274 School District #276 47,345,000 42,441,773 23.4 7 9,961,084 School District #277 11,550,000 9,963,640 2.03 202,262 Metropolitan Council 209,515,000 155,050,000 0.79 1,224,895 Hennepin County RR Authority 49,395,000 48,803,803 1.14 556,363 Total Overlapping Debt 672,985,000 601,996,060 30.01 15,725,708 Total Direct and Overlapping Debt $684,705,000 $613,507,259 130.01 % $27,236,907 -88- -89- I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA Table 12 REVENUE BOND COVERAGE LAST TEN FISCAL YEARS (1) Net Ratio of Net Fiscal Gross (2) Revenue Debt Service Revenue to Year Revenue Expenses Available Principal Interest Total Debt Service 1993 $ 172,624 $ 139,490 $ 33,134 $ 10,000 $ 4,860 $ 14,860 2.230 : 1 1994 262,892 159,179 103,713 15,000 4,035 19,035 5.449 : 1 1995 198,566 166,970 31,596 15,000 3,486 18,486 1.710 : 1 1996 272,678 170,485 102,193 15,000 74,473 89,473 1.142 : 1 1997 252,866 180,601 72,265 125,000 120,737 245,737 .294: 1 1998 311 ,925 179,914 132,011 185,000 125,085 310,085 .4257 : 1 1999 454,227 201,325 252,902 180,000 117,642 297,642 .8497 : 1 2000 465,548 186,696 278,852 190,000 109,736 299,736 .9303 : 1 2001 398,555 209,332 189,223 185,000 99,739 284,739 .6646 : 1 2002 287,465 236,575 50,890 185,000 93,280 278,280 .1828 : 1 (1) Includes the Water fund (2) Excluding depreciation and interest on bonds I I I I I I I I I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA PROPERTY VALUE AND CONSTRUCTION LAST TEN FISCAL YEARS Table 13 (I) Commercial (1) Construction Residential Construction (2) Fiscal Number Property Value Year Value of Units Value Commercial Residential Total 1993 $ 102 $ 17,941,776 $ 11,307,900 $ 391,057,000 $ 402,364,900 1994 960,000 86 16,530,925 11,338,700 413,780,300 425,119,000 1995 2,030,000 40 10,137,210 9,793,000 453,616,100 463,409,100 1996 1,350,000 37 9,393,436 10,562,200 517,983,900 528,546,100 1997 695,000 41 11,825,463 13,034,900 542,674,600 555,709,500 1998 1,317,000 35 9,563,920 14,572,900 580,878,400 595,451,300 1999 39 10,673,841 18,097,200 607,425,000 625,522,200 2000 428,000 71 12,151,100 17,487,100 668,078,300 685,565,400 2001 34 11,451,098 21,243,000 774,394,300 795,637,300 2002 4,640,000 8 4,882,022 23,438,500 891,331,300 914,769,800 (1) City Planning and Inspection Department (2) County Assessor's Office -90- I I I I I I I I I I I CITY OF SHOREWOOD, MINNESOTA MISCELLANEOUS STATISTICS DECEMBER 31, 2002 Table 14 Year of incorporation Form of government 1956 Council-Administrator Adopted May 14, 1956 January 1 6.0 square miles Fiscal year begins Area of City Population 2000 Census 1990 Census 1980 Census 1970 Census 7,400 5,917 4,646 4,223 Miles of streets and alleys City streets Municipal state aid streets County roads State highway 41.0 9.8 1.7 2.7 Sewer Lift stations Sewer rates - residential Miles of sewer lines 14 $60.00!quarter 56.2 Number of street lights 177 Building permits issued in 2002 Number of permits Value 927 $ 17,850,162 Fire protection: Contracted services with Mound and Excelsior Fire District I Police protection: Contracted services with South Lake Minnetonka Police Department I I I I I I I Parks Number Acres 5 95.8 Water Number of connections Average daily consumption Miles of water main Daily capacity - gallons Number of fire hydrants Water rate 1,216 403,000 gallons 15.2 4,680,000 gallons 165 $1.50/1 000 gallons Employees Regular Part-time! seasonal Total 23 30 53 Elections Registered voters last election Number of votes cast last election Percentage of registered voters voting 4,981 4,521 90.8% -91-