HomeMy WebLinkAbout2005 Comprehensive Annual Financial ReportCITY OF EDINA
2005 Comprehensive Annual Financial Report
CITY OF EDINA, MINNESOTA
Comprehensive Annual Financial Report
For the fiscal year ended
December 31, 2005
Prepared by:
Department of Finance
John Wallin – Treasurer and Finance Director
Eric Roggeman – Assistant Finance Director
Paula Nelson – Accountant
CITY OF EDINA, MINNESOTA
TABLE OF CONTENTS
Page
ReferenceNo.
I. INTRODUCTORY SECTION
Letter of Transmittal 1
Organization 5
Organization Chart 6
II. FINANCIAL SECTION
Independent Auditors' Report 7
Management's Discussion and Analysis 9
Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net AssetsStatement 121
Statement of ActivitiesStatement 222
Fund Financial Statements:
Balance Sheet - Governmental FundsStatement 325
Statement of Revenues, Expenditures, and Changes in Fund Balances -
Governmental FundsStatement 426
Reconciliation of the Statement of Revenues, Expenditures, and Changes in
Fund Balances of Governmental Funds to the Statement of ActivitiesStatement 527
Statement of Net Assets - Proprietary FundsStatement 628
Statement of Revenues, Expenses, and Changes in Fund Net Assets -
Proprietary FundsStatement 729
Statement of Cash Flows - Proprietary FundsStatement 830
Statement of Fiduciary Net Assets - Fiduciary FundsStatement 932
Notes to the Financial Statements 33
Required Supplementary Information:
Budgetary Comparison Information:
Budgetary Comparison Schedule - General FundStatement 1061
Notes to Required Supplementary Information67
CITY OF EDINA, MINNESOTA
TABLE OF CONTENTS
Page
ReferenceNo.
Combining and Individual Non Major Fund Financial Statements and Schedules:
Combining Balance Sheet - Nonmajor Special Revenue FundsStatement 1170
Combining Statement of Revenues, Expenditures and Changes in
Fund Balances - Nonmajor Special Revenue FundsStatement 1271
Special Revenue Fund - Community Development Block Grant
Schedule of Revenues, Expenditures and Changes in Fund
Balances - Budget and ActualStatement 1372
Combining Statement of Net Assets - Nonmajor Proprietary FundsStatement 1474
Combining Statement of Revenues, Expenses and Changes in
Fund Net Assets - Nonmajor Proprietary FundsStatement 1575
Combining Statement of Cash Flows - Nonmajor Proprietary FundsStatement 1676
Combining Statement of Changes in Assets and Liabilities - Agency FundsStatement 1777
Supplementary Financial Information:
Combined Schedule of IndebtednessExhibit 180
Assessed Valuation, Tax Levies and Mill RatesExhibit 282
Schedule of Sources and Uses of Public Funds for 50th & France - #1200Exhibit 383
Schedule of Sources and Uses of Public Funds for Southeast Edina
Redevelopment District - #1201Exhibit 484
Schedule of Sources and Uses of Public Funds for Grandview Area
Redevelopment District - #1202Exhibit 585
Schedule of Sources and Uses of Public Funds for Southeast Edina
Redevelopment District - #1203Exhibit 686
Schedule of Sources and Uses of Public Funds for 70th Street and
Cahill Road District - #1207Exhibit 787
CITY OF EDINA, MINNESOTA
TABLE OF CONTENTS
Page
ReferenceNo.
III. STATISTICAL SECTION (UNAUDITED)
Government-wide Information:
Government-wide Expenses By FunctionTable 190
Government-wide RevenuesTable 292
Fund Information:
Property Tax Levies and CollectionsTable 393
Assessed Value or Tax Capacity and Estimated Market Value of
Taxable PropertyTable 494
Property Tax Rates - All Overlapping GovernmentsTable 595
Special Assessment CollectionsTable 696
Ratio of Net Bonded Debt to Assessed Value and Net Bonded
Debt per CapitaTable 797
Computation of Direct and Overlapping DebtTable 898
Ratio of Annual Debt Service Expenditures for General BondedTable 999
Debt to Total General Expenditures
Revenue Bond CoverageTable 10100
Property and Construction ValuesTable 11101
Principal TaxpayersTable 12102
Major Employers in the CityTable 13103
Demographic StatisticsTable 14104
Miscellaneous Statistical DataTable 15105
This page left blank intentionally.
CITY OF EDINA, MINNESOTA
ORGANIZATION
December 31, 2005
Term Expires
Mayor:
James Hovland December 31, 2008
Council Members:
Scot Housh December 31, 2006
Alice Hulbert December 31, 2006
Linda Masica December 31, 2008
Ann Swenson December 31, 2008
City Manager:
Gordon Hughes Appointed
Finance Director/Treasurer:
John Wallin Appointed
City Clerk:
Debra Mangen Appointed
5
City of Edina
Boards andCommissions
HRA Personnel
Elections
City Clerk
Human Resources
Human Services
Communications
Technology
Liquor
Administration Assessing
Recycling
Health
Water and Sewer
Street Maintenance
Engineering
Public
Works
Planning
Recreational
Facilities
Recreational
Programs
Park Maintenance
Parks and
Recreation
Building
Inspections
Finance
Civil Defense
Animal Control
Police Operations
Police
Prevention and
Control
EMS
Special Operations
Fire
Public Safety
City Manager
City Council City Attorney
Citizens
9
MANAGEMENT’S DISCUSSION AND ANALYSIS
As management of the City of Edina (the City), we offer readers of the City’s financial
statements this narrative overview and analysis of the financial activities of the City for the
fiscal year ended December 31, 2005. We encourage readers to consider the information
presented here in conjunction with additional information that we have furnished in our letter
of transmittal, which can be found on pages 1 through 4 of this report.
Financial Highlights
• The assets of the City exceeded its liabilities at the close of the most recent fiscal year by
$123,133,653 (net assets). Of this amount, $46,918,521 (unrestricted net assets) may be
used to meet the government’s ongoing obligations to citizens and creditors in
accordance with the City's fund designations and fiscal policies.
• The City’s total net assets increased by $8,730,369.
• As of the close of the current fiscal year, the City’s governmental funds reported
combined ending fund balances of $43,374,873. Of this total amount, $29,359,210, or
68%, is available for spending at the City’s discretion (unreserved fund balance).
• At the end of the current fiscal year, unreserved fund balance for the general fund was
$11,595,433, or 48% of total general fund expenditures.
• The City’s total bonded debt increased by $7,545,000 during the current fiscal year, from
$60,835,000 to $68,380,000. The City issued $32,505,000 in debt during the year,
including two “crossover refunding” issues. At year-end, the City had $9,049,242 in
assets held by a trustee that were used to refund $9,035,000 in outstanding bonded debt
on February 1, 2006. Since the refunding occurred after year-end, the principal amount
of the bonds that were refunded are included in the outstanding debt total at year-end.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the City’s basic
financial statements. The City’s basic financial statements comprise three components: 1)
government-wide financial statements, 2) fund financial statements, and 3) notes to the
financial statements. This report also contains other supplementary information in addition
to the basic financial statements themselves.
Government-wide financial statements. The government-wide financial statements are
designed to provide readers with a broad overview of the City’s finances, in a manner similar
to a private-sector business.
Management’s Discussion and Analysis (Continued)
10
The statement of net assets presents information on all of the City’s assets and liabilities,
with the difference between the two reported as net assets. Over time, increases or decreases
in net assets may serve as a useful indicator of whether the financial position of the City is
improving or deteriorating.
The statement of activities presents information showing how the City’s net assets changed
during the most recent fiscal year. All changes in net assets are reported as soon as the
underlying event giving rise to the change occurs, regardless of the timing of related cash
flows. Thus, revenues and expenses are reported in this statement for some items that will
only result in cash flows in future fiscal periods (e.g. uncollected taxes and earned but unused
vacation leave).
Both of the government-wide financial statements distinguish functions of the City that are
principally supported by taxes and intergovernmental revenues (governmental activities)
from other functions that are intended to recover all or a significant portion of their costs
through user fees and charges (business-type activities). The governmental activities of the
City include general government, public safety, public works and parks. The business-type
activities of the City include utilities, liquor, aquatic center, golf course and community
activity centers.
The government-wide financial statements can be found on pages 21 through 23 of this
report.
Fund financial statements. A fund is a grouping of related accounts that is used to maintain
control over resources that have been segregated for specific activities or objectives. The
City, like other state and local governments, uses fund accounting to ensure and demonstrate
compliance with finance-related legal requirements. All of the funds of the City can be
divided into three categories: governmental funds, proprietary funds, and fiduciary funds.
Governmental funds. Governmental funds are used to account for essentially the
same functions reported as governmental activities in the government-wide financial
statements. However, unlike the government-wide financial statements, governmental
fund financial statements focus on near-term inflows and outflows of spendable
resources, as well as on balances of spendable resources available at the end of the
fiscal year. Such information may be useful in evaluating a government’s near-term
financial requirements.
Because the focus of governmental funds is narrower than that of the government-
wide financial statements, it is useful to compare the information presented for
governmental funds with similar information presented for governmental activities in
the government-wide financial statement. By doing so, readers may better understand
the long-term impact of the City's near term financial decisions. Both the
governmental fund balance sheet and governmental fund statement of revenues,
expenditures, and change in fund balances provide a reconciliation to facilitate this
comparison between governmental funds and governmental activities.
Management’s Discussion and Analysis (Continued)
11
The City maintains 4 individual major governmental funds. Information is presented
separately in the governmental fund balance sheet and in the governmental fund
statement of revenues, expenditures, and changes in fund balances for the general
fund, debt service fund, construction fund and the Housing and Redevelopment
Authority fund.
Data from the other governmental funds are combined into a single, aggregated
presentation. Individual fund data for each of these non-major governmental funds
are provided in the form of combining statements elsewhere in this report.
The City adopts an annual appropriated budget for its general fund and one of its
special revenue funds.
A budgetary comparison statement has been provided for those funds to demonstrate
compliance with this budget.
The basic governmental fund financial statements can be found on pages 25 through
27 of this report.
Proprietary funds. The City maintains four major enterprise funds. Enterprise
funds are used to report the same functions presented as business-type activities in the
governmental-wide financial statements. The City uses enterprise funds to account
for its utility, liquor, aquatic center and golf course operations.
Data from the other proprietary funds are combined into a single, aggregated
presentation. Individual fund data for each of these non-major proprietary funds are
provided in the form of combining statements elsewhere in this report.
Proprietary funds provide the same type of information as the government-wide
financial statements, only in more detail.
The basic proprietary fund financial statements can be found on pages 28 through 31
of this report.
Fiduciary funds. Fiduciary funds are used to account for resources held for the
benefit of parties outside the government. Fiduciary funds are not reflected in the
government-wide financial statements because the resources of those funds are not
available to support the City’s own programs. The accounting used for fiduciary
funds is much like that used for proprietary funds.
The basic fiduciary fund financial statement can be found on page 32 of this report.
Management’s Discussion and Analysis (Continued)
12
Notes to the financial statements. The notes provide additional information that is essential
to a full understanding of the data provided in the government–wide and fund financial
statements. The notes to the financial statements can be found on pages 33 through 60 of this
report.
Other information. The combining statements referred to earlier in connection with non-
major governmental and enterprise funds are presented immediately following the required
supplementary information on budgetary comparisons. Combining and individual fund
statements and schedules can be found on pages 69 through 77 of this report.
Government-wide Financial Analysis
As noted earlier, net assets may serve over time as a useful indicator of a government's
financial position. In the case of the City, assets exceeded liabilities by $123,133,653 at the
close of the most recent fiscal year.
The largest portion of the City's net assets ($76,136,189 or 62%) reflects its investment in
capital assets (e.g. land, buildings, machinery, and equipment) less any related debt used to
acquire those assets that is still outstanding. The City uses these capital assets to provide
services to citizens; consequently, these assets are not available for future spending.
Although the City's investment in its capital assets is reported net of related debt, it should be
noted that the resources needed to repay this debt must be provided from other sources, since
the capital assets themselves cannot be used to liquidate these liabilities.
City of Edina’s Net Assets
200520042005200420052004
Current and
other assets50,732,285$ 36,819,938$ 13,162,400$ 14,653,953$ 63,894,685$ 51,473,891$
Capital assets86,694,237 83,676,658 49,664,376 48,340,698 136,358,613 132,017,356
Total assets137,426,522$ 120,496,596$ 62,826,776$ 62,994,651$ 200,253,298$ 183,491,247$
Long-term liabilities
outstanding46,150,081$ 45,184,272$ 8,855,261$ 10,323,185$ 55,005,342$ 55,507,457$
Other liabilities19,308,677 10,084,012 2,805,626 3,496,494 22,114,303 13,580,506
Total liabilities65,458,758$ 55,268,284$ 11,660,887$ 13,819,679$ 77,119,645$ 69,087,963$
Net assets:
Invested in capital
assets, net of
related debt36,092,020$ 34,320,784$ 40,044,169$ 37,240,476$ 76,136,189$ 71,561,260$
Restricted78,943 2,145,488 - - 78,943 2,145,488
Unrestricted35,796,801 28,762,040 11,121,720 11,934,496 46,918,521 40,696,536
Total net assets71,967,764$ 65,228,312$ 51,165,889$ 49,174,972$ 123,133,653$ 114,403,284$
Governmental ActivitiesBusiness-Type ActivitiesTotals
Management’s Discussion and Analysis (Continued)
13
A portion of the City's net assets represents resources that are subject to external restrictions
on how they may be used. The remaining balance of unrestricted net assets ($46,918,521)
may be used to meet the City's ongoing obligations to citizens and creditors.
At the end of the current fiscal year, the City is able to report positive balances in all three
categories of net assets, both for the government as a whole, as well as for its separate
governmental and business-type activities.
As shown below, the City’s net assets increased by $8,730,369 during the current fiscal year.
Factors contributing to this change are discussed in the next two sections.
City of Edina's Changes in Net Assets
200520042005200420052004
Revenues:
Program revenues:
Charges for services6,864,089$ 5,837,745$ 28,577,344$ 27,461,413$ 35,441,433$ 33,299,158$
Operating grants and
contributions1,512,366 1,154,808 131,408 138,447 1,643,774 1,293,255
Capital grants and
contributions2,252,491 4,192,947 - - 2,252,491 4,192,947
General revenues:
Property taxes19,071,202 17,865,757 - - 19,071,202 17,865,757
Other taxes7,518,165 7,212,890 - - 7,518,165 7,212,890
Gain on disposal of asset63,674 - 22,538 6,490 86,212 6,490
Unrestricted investment
earnings977,956 443,074 236,654 227,167 1,214,610 670,241
Total revenues38,259,943 36,707,221 28,967,944 27,833,517 67,227,887 64,540,738
Expenses:
General government4,967,008 6,934,045 - - 4,967,008 6,934,045
Public safety12,019,027 11,063,767 - - 12,019,027 11,063,767
Public works7,185,784 5,834,490 - - 7,185,784 5,834,490
Parks5,901,648 4,248,060 - - 5,901,648 4,248,060
Interest on long-term debt2,288,524 2,399,682 - - 2,288,524 2,399,682
Utilities- - 8,254,409 7,801,580 8,254,409 7,801,580
Liquor- - 9,749,313 9,110,888 9,749,313 9,110,888
Aquatic Center- - 725,936 701,768 725,936 701,768
Golf course- - 3,580,307 3,508,741 3,580,307 3,508,741
Community Activity Centers- - 3,825,562 3,850,192 3,825,562 3,850,192
Total expenses 32,361,991 30,480,044 26,135,527 24,973,169 58,497,518 55,453,213
Increase in net assets
before transfers5,897,952 6,227,177 2,832,417 2,860,348 8,730,369 9,087,525
Transfers841,500 655,227 (841,500) (655,227) - -
Increase in net assets6,739,452 6,882,404 1,990,917 2,205,121 8,730,369 9,087,525
Net assets - January 165,228,312 58,345,908 49,174,972 46,969,851 114,403,284 105,315,759
Net assets - December 3171,967,764$ 65,228,312$ 51,165,889$ 49,174,972$ 123,133,653$ 114,403,284$
Governmental ActivitiesBusiness-type ActivitiesTotals
Management’s Discussion and Analysis (Continued)
14
Governmental Activities
Governmental activities increased the City's net assets by $6,739,452, accounting for 77% of
the total growth in net assets. This increase is a combination of many surpluses and deficits,
but the primary reason is that the City has chosen to delay reporting major infrastructure
assets retroactively until fiscal year 2006, as described in footnote 3. Since these costs have
not yet been capitalized, there is no corresponding depreciation expense recorded. Until the
costs of the infrastructure can be estimated, it is impossible to estimate the impact that
infrastructure depreciation will have on the financial statements next year.
Below are specific graphs which provide comparisons of the governmental activities
revenues and expenses:
Revenues by Source - Governmental Activities
Property taxes
49%
Other taxes
20%
Other
3%
Capital grants and
contributions
6%
Operating grants
and contributions
4%
Charges for
services
18%
-
2
4
6
8
10
12
14
Millions
General
government
Public safetyPublic worksParksInterest on long-
term debt
Expenses and Program Revenues - Governmental
Activities
expenses
program revenue
Management’s Discussion and Analysis (Continued)
15
Business-type Activities
Business-type activities increased net assets by $1,990,917 accounting for 23% of the City's
growth in net assets. The increase in net assets is smaller than the prior year due to larger
transfers to governmental activities and decreasing golf course revenues. Key elements of
the current year increase are as follows:
• Charges for services for business-type activities increased 4.1% from 2004. The
Aquatic Center had the largest individual percentage increase (11.2%) in charges for
services, but the largest dollar increase ($722,657) was from the liquor operations.
• Business-type activities made net transfers of $841,500 to governmental activities
during 2005 to provide cash flow for operational and capital improvement needs.
Revenues by Source - Business-type Activities
Charges for
services
98.7%
Operating
grants and
contributions
0.5%
Other
0.8%
-
2
4
6
8
10
12
Millions
UtilitiesLiquorAquatic CenterGolf courseCommunity
Activity Centers
Expenses and Program Revenues - Business-type
Activities
expenses
program revenue
Management’s Discussion and Analysis (Continued)
16
Financial Analysis of the City's Funds
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with
finance-related legal requirements.
Governmental Funds. The focus of the City’s governmental funds is to provide information
on near-term inflows, outflows, and balances of spendable resources. Such information is
useful in assessing the City’s financing requirements. In particular, unreserved fund balance
may serve as a useful measure of a government’s net resources available for spending at the
end of the fiscal year.
At the end of the current fiscal year, the City's governmental funds reported combined ending
fund balances of $43,374,873, an increase of $11,859,361 in comparison with the prior year.
Approximately 68 percent of this total amount ($29,359,210) constitutes unreserved fund
balance. The remainder of the fund balance is reserved because it has already been
committed 1) to provide for prepaid items ($223,351), 2) to pay committed contracts
($2,422,917), 3) for special projects ($354,649), or 4) to pay debt service ($11,014,746).
The general fund is the chief operating fund of the City. At the end of the current fiscal year,
unreserved fund balance of the general fund was $11,595,433. As a measure of the general
fund’s liquidity, unreserved fund balance represents 48% of total general fund expenditures.
The fund balance of the City’s general fund increased by $1,201,958 during the current fiscal
year. Key factors in this growth are as follows:
• Total general fund revenues increased by 13.2% in the current fiscal year. The largest
individual increases was in license and permit fees, which increased 44% from the
prior year. Ambulance revenue also increased significantly, mostly due to increased
calls for service.
• Total general fund expenditures increased 8.8% in the current fiscal year. Some
increased costs were due to rising energy costs, but the largest factor was the City’s
equipment replacement program, which was approximately $500,000 over budget due
to large equipment purchases by the Police and Fire departments.
• A budgeted transfer of $686,500 from the liquor fund was made to the construction
fund instead of the general fund due to the relative strength of the general fund’s
financial position and positive operating results.
The debt service fund has a total fund balance of $11,014,746, all of which is reserved for the
payment of debt service. This balance includes $9,049,242 in restricted investments which
were held in trust at year-end for the crossover refunding of two bond issues ($9,035,000
combined principal) occurring in February 2006.
The construction fund balance increased by $2,427,657 in 2005 due to ongoing construction
for two new gymnasiums, which was financed with a bond issue in 2005.
Management’s Discussion and Analysis (Continued)
17
The Housing and Redevelopment Authority fund balance decreased by $589,081 in the
current fiscal year as several tax increment districts are rapidly paying down the debt that
was issued. Two of the districts expire in 2009 and have the majority of the principal being
paid over the next few years.
Proprietary funds. The City’s proprietary funds provide the same type of information
found in the government-wide financial statements, but in more detail.
Operating revenues and expenses in the Utilities fund increased by 8% and 6%, respectively,
in 2005, due to small rate increases that are intended to help replace aging infrastructure.
The City’s continuing investments in infrastructure are reported as increases in net capital
assets, which increased $1,323,678 from 2004.
The liquor fund made transfers totaling $927,500 to other funds during 2005. The majority
of this amount ($786,500) was transferred to the construction fund to fund future
infrastructure improvements, with the remainder transferred to nonmajor proprietary funds.
Aquatic center revenues increased 11% in 2005 due to increased attendance and favorable
summer weather.
Operating revenues for the golf course fund decreased for the second consecutive year.
Combined with the effects of increasing expenses, the golf course lost $97,308 in 2005.
Budgetary Highlights
General Fund. There were no changes made to the original budget. During the year,
revenues and expenditures exceeded budgetary estimates, and since increased revenues easily
covered the increased expenditures, there was no need to draw upon existing fund balance.
Capital Asset and Debt Administration
Capital assets. The City’s investment in capital assets for its governmental and business
type activities as of December 31, 2005, amounted to $136,358,613 (net of accumulated
depreciation). This investment in capital assets included land, land improvements, buildings,
vehicles and equipment.
Major capital asset events during the current fiscal year included the following:
• Construction started on two new Gymnasiums in 2005.
• A variety of street construction, sidewalk and traffic signal projects began in 2005;
construction in progress as of the close of the year reached $8,029,499.
• The City added a new “infrastructure” category to our capital assets which includes
streets, sidewalks, parking ramps, sewers, wells and other infrastructure. With the
addition of a new category, some category reclassifications were necessary, although
they have no effect on total amounts.
Management’s Discussion and Analysis (Continued)
18
City of Edina’s Capital Assets
(Net of Depreciation)
200520042005200420052004
Land and land
improvements25,463,830$ 30,798,413$ 5,553,727$ 5,832,714$ 31,017,557$ 36,631,127$
Buildings and
improvements30,219,684 29,271,125 7,747,988 8,206,831 37,967,672 37,477,956
Machinery and equipment8,859,303 9,155,646 2,296,740 2,385,570 11,156,043 11,541,216
Infrastructure16,755,486 - 31,432,356 26,321,161 48,187,842 26,321,161
Construction in progress5,395,934 14,451,474 2,633,565 5,594,422 8,029,499 20,045,896
Total86,694,237$ 83,676,658$ 49,664,376$ 48,340,698$ 136,358,613$ 132,017,356$
Governmetal ActivitiesBusiness-Type ActivitiesTotals
Additional information on the City’s capital assets can be found in Note 3.
Long-term debt. At the end of the current fiscal year, the City had total bonded long-term
debt outstanding of $68,380,000, an increase of $7,545,000 from 2004.
$13,225,000 is for general obligation improvement debt that is supported by property tax
levies and special assessments. This amount increased from 2004 due to issuance of
permanent improvement revolving (PIR) bonds, which finance the City’s special assessment
program. In addition, $5,575,000 of this amount was retired in early 2006 as part of a
crossover refunding initiated in 2005.
An additional $28,905,000 of general obligation tax increment debt financed the City’s
economic development program. $3,460,000 of this amount was retired in early 2006 as part
of a crossover refunding initiated in 2005.
Also outstanding is $16,560,000 public project revenue bonds which financed the City Hall
and Police facility as well as two gymnasiums, which are under construction as of year-end.
There is a total of $9,690,000 in revenue bonds for improvements to the enterprise funds.
City of Edina’s Outstanding Debt
200520042005200420052004
Tax increment bonds28,905,000$ 30,760,000$ -$ -$ 28,905,000$ 30,760,000$
General obligation bonds13,225,000 7,295,000 - - 13,225,000 7,295,000
Public project revenue bonds16,560,000 11,595,000 - - 16,560,000 11,595,000
Revenue bonds- - 9,690,000 11,185,000 9,690,000 11,185,000
Total58,690,000$ 49,650,000$ 9,690,000$ 11,185,000$ 68,380,000$ 60,835,000$
Governmental ActivitiesBusiness-Type ActivitiesTotals
The City maintains a Aaa rating from Moody's and a AAA rating from Standard & Poor’s.
Management’s Discussion and Analysis (Continued)
19
State statutes limit the amount of general obligation debt a Minnesota city may issue to 2% of
total Estimated Market Value. The current debt limitation for the City is $173,866,918.
Only $11,593,838 of the City's outstanding debt is counted within the statutory limitation.
Additional information on the City’s long-term debt can be found in Note 4.
Economic Factors and Next Year’s Budget
The City strives to provide an uncommonly high quality of life for our residents and
businesses and the healthy local economy helps to make this goal a reality. The
unemployment rate in Edina for March 2006 was 3.2%, well below the state and national
levels. In fact, according to the State of Minnesota Department of Employment and
Economic Development, the City’s unemployment rate has been lower than the national rate
every month since at least 1990. The City is home to Southdale Center, the nation’s first
fully enclosed climate-controlled regional shopping mall, Fairview Southdale hospital, as
well as several corporate headquarters. In addition to its healthy economy, Edina is known
for excellent public schools, as the Edina school system has been consistently selected as one
of the best in the country. Ninety-six percent of seniors go to college and eighty-six percent
finish in five years.
Property values in Edina have been increasing at a rapid pace for several years. Estimated
market value of all parcels increased over 8% for taxes payable in 2006 after a 16% increase
the year before. The City Council is currently reviewing several redevelopment projects that
would make this trend likely to continue.
Market Value and Tax Capacity
Annual Changes
-25.0%-20.0%-15.0%-10.0%
-5.0%
0.0%5.0%10.0%15.0%
20.0%
25.0%
199719981999200020012002200320042005
Tax Capacity
Market Value
The City collects property taxes based on tax capacity, which is roughly estimated market
value multiplied by class rates for different types of parcels (commercial, residential, etc.),
which are set by state statute. Tax capacity increased over 11.5% for taxes payable in 2006,
and has been increasing steadily ever since the state revised property tax law in 2001.
Management’s Discussion and Analysis (Continued)
20
Due to the recent increases in market value and tax capacity, property tax rates have been
decreasing since the property tax law changes mentioned earlier.
The City’s adopted 2006 budget includes a property tax levy of $18,560,151 for the general
fund, an increase of 4.4% from the 2005 general fund levy.
Requests for Information
This financial report is designed to provide a general overview of the City’s finances for all
those with an interest in the government’s finances. Questions concerning any of the
information provided in this report or requests for additional financial information should be
addressed to the Office of the Finance Director, 4801 West 50th Street, Edina, Minnesota
55424. The City’s Comprehensive Annual Financial Report can also be found on the internet
at www.cityofedina.com.
CITY OF EDINA, MINNESOTA
STATEMENT OF NET ASSETS Statement 1
December 31, 2005
GovernmentalBusiness-type
ActivitiesActivitiesTotal
Assets:
Current assets:
Cash and cash equivalents51,239$ 293,366$ 344,605$
Investments36,621,466 8,825,686 45,447,152
Restricted investments9,049,242 - 9,049,242
Accrued interest 212,464 48,622 261,086
Accounts receivable, net409,681 2,203,501 2,613,182
Special assessments receivable3,961,943 151,160 4,113,103
Due from other governments375,540 3,482 379,022
Prepaid items223,351 - 223,351
Internal balances(500,000) 500,000 -
Inventory- 1,109,991 1,109,991
Total current assets50,404,926 13,135,808 63,540,734
Noncurrent assets:
Deferred charges327,359 26,592 353,951
Nondepreciable capital assets 19,702,783 3,722,530 23,425,313
Depreciable capital assets (net)66,991,454 45,941,846 112,933,300
Total noncurrent assets87,021,596 49,690,968 136,712,564
Total assets137,426,522 62,826,776 200,253,298
Liabilities:
Current liabilities:
Accounts payable2,465,852 729,542 3,195,394
Salaries payable295,573 71,969 367,542
Accrued interest payable953,738 164,111 1,117,849
Contracts payable213,340 830 214,170
Due to other governments61,690 136,356 198,046
Deposits payable 65,925 11,569 77,494
Unearned revenue1,930 62,532 64,462
Compensated absences payable295,330 83,717 379,047
Liabilities payable from restricted assets8,970,299 - 8,970,299
Bonds payable5,985,000 1,545,000 7,530,000
Total current liabilities19,308,677 2,805,626 22,114,303
Noncurrent liabilities:
Compensated absences payable2,657,970 753,462 3,411,432
Bonds payable, net of unamortized discount43,492,111 8,101,799 51,593,910
Total noncurrent liabilities46,150,081 8,855,261 55,005,342
Total liabilities65,458,758 11,660,887 77,119,645
Net assets:
Invested in capital assets, net of related debt36,092,020 40,044,169 76,136,189
Restricted for debt service78,943 - 78,943
Unrestricted35,796,801 11,121,720 46,918,521
Total net assets71,967,764$ 51,165,889$ 123,133,653$
Primary Government
The accompanying notes are an integral part of these financial statements
21
CITY OF EDINA, MINNESOTA
STATEMENT OF ACTIVITIES
For The Year Ended December 31, 2005
OperatingCapital
Charges forGrants andGrants and
ExpensesServicesContributionsContributions
Functions/Programs
Primary government:
Governmental activities:
General government4,967,008$ 619,526$ 172,635$ -$
Public safety12,019,027 5,614,406 1,093,023 -
Public works7,185,784 273,859 195,000 2,252,491
Parks5,901,648 356,298 51,708 -
Interest on long-term debt2,288,524 - - -
Total government activities32,361,991 6,864,089 1,512,366 2,252,491
Business-type activities:
Utilities8,254,409 10,240,381 110,683 -
Liquor9,749,313 10,752,724 - -
Aquatic Center725,936 849,380 - -
Golf Course3,580,307 3,482,999 - -
Community Activity Centers3,825,562 3,251,860 20,725 -
Total business-type activities26,135,527 28,577,344 131,408 -
Total primary government 58,497,518$ 35,441,433$ 1,643,774$ 2,252,491$
The accompanying notes are an integral part of these financial statements.
Program Revenues
22
Statement 2
GovernmentalBusiness-type
ActivitiesActivitiesTotal
(4,174,847)$ -$ (4,174,847)$
(5,311,598) - (5,311,598)
(4,464,434) - (4,464,434)
(5,493,642) - (5,493,642)
(2,288,524) - (2,288,524)
(21,733,045) - (21,733,045)
- 2,096,655 2,096,655
- 1,003,411 1,003,411
- 123,444 123,444
- (97,308) (97,308)
- (552,977) (552,977)
- 2,573,225 2,573,225
(21,733,045) 2,573,225 (19,159,820)
General revenues:
Property taxes19,071,202 - 19,071,202
Tax increment collections7,060,744 - 7,060,744
Franchise taxes457,421 - 457,421
Unrestricted investment earnings977,956 236,654 1,214,610
Gain on disposal of capital assets63,674 22,538 86,212
Transfers841,500 (841,500) -
Total general revenues and transfers28,472,497 (582,308) 27,890,189
Change in net assets6,739,452 1,990,917 8,730,369
Net assets - beginning65,228,312 49,174,972 114,403,284
Net assets - ending71,967,764$ 51,165,889$ 123,133,653$
Net (Expense) Revenue and
Changes in Net Assets
23
This page left blank intentionally.
24
CITY OF EDINA, MINNESOTA
BALANCE SHEET Statement 3
GOVERNMENTAL FUNDS
December 31, 2005
Housing &NonmajorTotal
DebtRedevelopmentGovernmentalGovernmental
GeneralServiceConstructionAuthorityFundsFunds
Assets
Cash and cash equivalents34,023$ 121$ 4,314$ 8,633$ 4,148$ 51,239$
Investments - unrestricted10,628,068 1,631,162 11,313,945 12,418,027 630,264 36,621,466
Investments - restricted- 9,049,242 - - - 9,049,242
Accrued interest - 128,498 17,231 61,615 5,120 212,464
Accounts receivable278,596 - 2,653 - 128,432 409,681
Special assessments receivable- - 3,961,943 - - 3,961,943
Due from other funds1,803,000 200,000 - 435 11,000 2,014,435
Due from other governments290,260 10,022 6,201 58,952 10,105 375,540
Prepaid items223,351 - - - - 223,351
Total assets13,257,298$ 11,019,045$ 15,306,287$ 12,547,662$ 789,069$ 52,919,361$
Liabilities and fund balances
Liabilities:
Accounts payable881,622$ 1,299$ 847,284$ 691,641$ 44,006$ 2,465,852$
Salaries payable293,255 - 1,212 - 1,106 295,573
Contracts payable - - 213,340 - - 213,340
Due to other funds200,435 3,000 2,300,000 - 11,000 2,514,435
Due to other governments10,202 - 36,200 15,288 - 61,690
Deposits payable53,000 - 12,925 - - 65,925
Unearned revenue- - - - 1,930 1,930
Deferred revenue- - 3,925,743 - - 3,925,743
Total liabilities1,438,514 4,299 7,336,704 706,929 58,042 9,544,488
Fund balance:
Reserved for:
Prepaid items223,351 - - - - 223,351
Encumbrances- - 2,422,917 - - 2,422,917
Special projects- - 354,649 - - 354,649
Debt service- 11,014,746 - - - 11,014,746
Unreserved:
Designated, reported in:
General Fund11,595,433 - - - - 11,595,433
Capital Project Funds- - 5,192,017 - - 5,192,017
Undesignated, reported in:
Special Revenue Funds- - - - 731,027 731,027
Capital Project Funds- - - 11,840,733 - 11,840,733
Total fund balance11,818,784 11,014,746 7,969,583 11,840,733 731,027 43,374,873
Total liabilities and
fund balances13,257,298$ 11,019,045$ 15,306,287$ 12,547,662$ 789,069$ 52,919,361$
Fund balance reported above 43,374,873$
Amounts reported for governmental activities in the statement of net assets are different because:
Capital assets used in governmental activities are not financial resources, and therefore, are not reported in the funds86,694,237
Other long-term assets are not available to pay for current-period expenditures and, therefore, are deferred in the funds3,925,743
Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not
reported in the funds.(62,027,089)
Net assets of governmental activities 71,967,764$
The accompanying notes are an integral part of these financial statements.
25
CITY OF EDINA, MINNESOTA
STATEMENT OF REVENUES, EXPENDITURES AND Statement 4
CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
For The Year Ended December 31, 2005
Housing &NonmajorTotal
DebtRedevelopmentGovernmentalGovernmental
GeneralServiceConstructionAuthorityFundsFunds
Revenues:
General property taxes17,191,143$ 1,880,059$ -$ -$ -$ 19,071,202$
Tax increment collections- - - 7,060,744 - 7,060,744
Special assessments- - 1,354,264 - - 1,354,264
Franchise fees- - - - 457,421 457,421
License and permits3,240,622 - - - - 3,240,622
Intergovernmental1,147,345 - 219,189 - 172,635 1,539,169
Charges for services2,415,766 - 50,897 - - 2,466,663
Fines and forfeitures742,917 - - - - 742,917
Investment income181,784 215,706 283,854 281,536 15,076 977,956
Rental of property283,595 - 31,947 - - 315,542
Other revenues149,463 - 22,537 1,200 54,246 227,446
Total revenues25,352,635 2,095,765 1,962,688 7,343,480 699,378 37,453,946
Expenditures:
Current:
General government3,574,010 - 13,911 1,139,578 749,809 5,477,308
Public safety11,308,678 - 65,085 - - 11,373,763
Public works4,684,074 - 198,737 - - 4,882,811
Parks2,983,542 - 162,487 - - 3,146,029
Capital outlay:
General government27,954 - 176,086 - - 204,040
Public safety1,040,378 - 254,590 - - 1,294,968
Public works482,937 - 4,587,966 - - 5,070,903
Parks134,149 - 1,523,131 - - 1,657,280
Debt service:
Bond principal - 6,830,000 - - - 6,830,000
Interest and fiscal charges- 2,543,639 - - - 2,543,639
Total expenditures24,235,722 9,373,639 6,981,993 1,139,578 749,809 42,480,741
Revenues over
(under) expenditures1,116,913 (7,277,874) (5,019,305) 6,203,902 (50,431) (5,026,795)
Other financing sources (uses):
Transfers in- 6,860,869 936,500 - - 7,797,369
Transfers out(50,000) - (112,886) (6,792,983) - (6,955,869)
Sale of capital assets135,045 - - - - 135,045
Bonds issued- 9,162,685 6,653,480 - - 15,816,165
Discount on bonds issued- (6,143) (30,132) - - (36,275)
Refunding bonds issued- 16,764,721 - - - 16,764,721
Payment to refunding escrow- (16,635,000) - - - (16,635,000)
Total other financing
sources (uses)85,045 16,147,132 7,446,962 (6,792,983) - 16,886,156
Net increase (decrease)
in fund balance1,201,958 8,869,258 2,427,657 (589,081) (50,431) 11,859,361
Fund balance - January 110,616,826 2,145,488 5,541,926 12,429,814 781,458 31,515,512
Fund balance - December 3111,818,784$ 11,014,746$ 7,969,583$ 11,840,733$ 731,027$ 43,374,873$
The accompanying notes are an integral part of these financial statements.
26
CITY OF EDINA, MINNESOTA
RECONCILIATION OF THE STATEMENT OF REVENUES,Statement 5
EXPENDITURES, AND CHANGES IN FUND BALANCES OF
GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
For The Year Ended December 31, 2005
Amounts reported for governmental activities in the
statement of activities (page 22-23) are different because:
Net changes in fund balances - total governmental funds (page 26)11,859,361$
Governmental funds report capital outlays as expenditures. However,
in the statement of activities the cost of those assets is allocated
over their estimated useful lives and reported as depreciation expense.
This is the amount by which capital outlays exceeded depreciation
in the current period.3,093,255
The net effect of disposals of capital assets is to decrease net assets(75,676)
Revenues in the statement of activities that do not provide current
financial resources (property tax and special assessment receivables)
are not reported as revenues in the funds.737,628
The issuance of long-term debt (e.g., bonds, leases) provides current
financial resources to governmental funds, while the repayment of the
principal of long-term debt consumes the current financial resources
of governmental funds. Neither transaction, however, has any effect
on net assets. Also, governmental funds report the effect of issuance
costs, premiums, discounts and similar items when debt is first issued,
whereas these amounts are deferred and amortized in the statement of
activities. This amount is the net effect of these differences in the
treatment of long-term debt and related items.(8,839,331)
Some expenses reported in the statement of activities do not require the
use of current financial resources (accrued interest and amortization on
debt and compensated absences payable) and, therefore, are not
reported as expenditures in governmental funds.(35,785)
Change in net assets of governmental activities (page 23)6,739,452$
The accompanying notes are an integral part of these financial statements.
27
CITY OF EDINA, MINNESOTA
STATEMENT OF NET ASSETS Statement 6
PROPRIETARY FUNDS
December 31, 2005
Nonmajor
AquaticGolfEnterprise
UtilitiesLiquorCenterCourseFundsTotal
Assets:
Current assets:
Cash and cash equivalents4,521$ 152,368$ 53,665$ 8,920$ 73,892$ 293,366$
Investments4,300,382 - - - 4,525,304 8,825,686
Interest receivable11,864 - - - 36,758 48,622
Accounts receivable, net2,068,478 - - 1,090 133,933 2,203,501
Special assessments receivable151,160 - - - - 151,160
Due from other funds- 780,000 630,000 - 25,000 1,435,000
Due from other governments3,482 - - - - 3,482
Inventory24,151 1,055,114 - 14,898 15,828 1,109,991
Total current assets6,564,038 1,987,482 683,665 24,908 4,810,715 14,070,808
Noncurrent assets:
Deferred charges13,305 - 3,322 6,112 3,853 26,592
Net capital assets35,404,525 1,421,250 2,474,184 6,060,442 4,303,975 49,664,376
Total noncurrent assets35,417,830 1,421,250 2,477,506 6,066,554 4,307,828 49,690,968
Total assets41,981,868 3,408,732 3,161,171 6,091,462 9,118,543 63,761,776
Liabilities:
Current liabilities:
Accounts payable241,960 302,398 666 56,247 128,271 729,542
Salaries payable14,092 17,312 352 16,968 23,245 71,969
Accrued interest payable58,125 - 26,367 67,227 12,392 164,111
Contracts payable830 - - - - 830
Due to other funds280,000 - - 630,000 25,000 935,000
Due to other governments1,730 122,393 1,079 5,451 5,703 136,356
Deposits payable1,972 - - 9,597 - 11,569
Unearned revenue- 2,589 - 7,422 52,521 62,532
Compensated absences payable 18,999 16,165 - 22,844 25,709 83,717
Bonds payable - current665,000 - 105,000 575,000 200,000 1,545,000
Total current liabilities1,282,708 460,857 133,464 1,390,756 472,841 3,740,626
Noncurrent liabilities:
Compensated absences payable170,990 145,485 - 205,599 231,388 753,462
Bonds payable, net of
unamortized discounts3,531,622 - 1,187,375 2,740,686 642,116 8,101,799
Total noncurrent liabilities3,702,612 145,485 1,187,375 2,946,285 873,504 8,855,261
Total liabilities4,985,320 606,342 1,320,839 4,337,041 1,346,345 12,595,887
Net assets:
Invested in capital assets,
net of related debt31,221,208 1,421,250 1,185,131 2,750,868 3,465,712 40,044,169
Unrestricted5,775,340 1,381,140 655,201 (996,447) 4,306,486 11,121,720
Total net assets36,996,548$ 2,802,390$ 1,840,332$ 1,754,421$ 7,772,198$ 51,165,889$
Business-type Activities - Enterprise Funds
The accompanying notes are an integral part of these financial statements.
28
CITY OF EDINA, MINNESOTA
STATEMENT OF REVENUES, EXPENSES AND Statement 7
CHANGES IN FUND NET ASSETS
PROPRIETARY FUNDS
For The Year Ended December 31, 2005
Nonmajor
AquaticGolfEnterprise
UtilitiesLiquorCenterCourseFundsTotal
Operating revenues:
Sales - liquor-$ 10,752,724$ -$ -$ -$ 10,752,724$
Sales - retail- - 3,857 257,210 71,312 332,379
Sales - utilities10,008,051 - - - - 10,008,051
Sales - concessions- - 115,716 313,743 23,926 453,385
Memberships- - 416,166 109,911 82,288 608,365
Admissions- - 290,570 275,452 440,358 1,006,380
Building rental- - 22,878 76,239 1,371,011 1,470,128
Rental of equipment- - - 368,258 57,893 426,151
Greens fees- - - 1,741,561 180,895 1,922,456
Other fees217,924 - 193 340,466 1,024,177 1,582,760
Total operating revenues10,225,975 10,752,724 849,380 3,482,840 3,251,860 28,562,779
Operating expenses:
Cost of sales and services30,880 7,918,705 31,591 333,812 37,435 8,352,423
Personal services1,285,071 1,167,182 277,517 1,679,532 1,749,636 6,158,938
Contractual services4,576,398 341,203 80,019 482,268 1,172,297 6,652,185
Commodities618,910 68,328 71,713 348,591 267,462 1,375,004
Central Services371,590 179,996 24,894 122,489 153,115 852,084
Depreciation1,224,190 73,899 185,814 468,793 418,460 2,371,156
Total operating expenses8,107,039 9,749,313 671,548 3,435,485 3,798,405 25,761,790
Operating income (loss)2,118,936 1,003,411 177,832 47,355 (546,545) 2,800,989
Nonoperating revenues (expenses):
Intergovernmental110,683 - - - - 110,683
Investment income122,510 - - - 114,144 236,654
Donations- - - - 20,725 20,725
Miscellaneous 14,406 - - 159 - 14,565
Interest and fiscal charges(141,226) - (53,283) (135,914) (24,911) (355,334)
Gain (loss) on sale of capital asset16,555 - - (3,417) 5,983 19,121
Amortization of bond discount(6,144) - (1,105) (5,491) (2,246) (14,986)
Total nonoperating
revenues (expenses)116,784 - (54,388) (144,663) 113,695 31,428
Income (loss) before transfers2,235,720 1,003,411 123,444 (97,308) (432,850) 2,832,417
Transfers:
Transfers in- - - - 186,000 186,000
Transfers out(100,000) (927,500) - - - (1,027,500)
Total transfers (100,000) (927,500) - - 186,000 (841,500)
Change in net assets2,135,720 75,911 123,444 (97,308) (246,850) 1,990,917
Net assets - January 1 34,860,828 2,726,479 1,716,888 1,851,729 8,019,048 49,174,972
Net assets - December 3136,996,548$ 2,802,390$ 1,840,332$ 1,754,421$ 7,772,198$ 51,165,889$
Business-type Activities - Enterprise Funds
The accompanying notes are an integral part of these financial statements.
29
CITY OF EDINA, MINNESOTA
STATEMENT OF CASH FLOWS Statement 8
PROPRIETARY FUNDS
For The Year Ended December 31, 2005
Nonmajor
AquaticGolfEnterprise
UtilitiesLiquorCenterCourseFundsTotal
Cash flows from operating activities:
Receipts from customers and users10,468,377$ 10,754,166$ 849,380$ 3,486,818$ 3,254,785$ 28,813,526$
Payment to suppliers(6,416,336) (8,440,539) (236,475) (1,257,705) (1,588,920) (17,939,975)
Payment to employees(1,269,746) (1,139,302) (277,504) (1,661,067) (1,722,161) (6,069,780)
Net cash provided by
(used in) operating activities2,782,295 1,174,325 335,401 568,046 (56,296) 4,803,771
Cash flows from noncapital financing activities:
State grant110,683 - - - - 110,683
Miscellaneous revenue14,406 - - 159 - 14,565
Transfer (to) from Enterprise Funds- (141,000) - - 141,000 -
Transfer (to) from Capital Project Funds(100,000) (786,500) - - 45,000 (841,500)
Net interfund borrowing1,395,000 (100,000) 14,477 259,214 - 1,568,691
Donations- - - - 20,725 20,725
Net cash provided by (used in)
noncapital financing activities1,420,089 (1,027,500) 14,477 259,373 206,725 873,164
Cash flows from capital and related financing activities:
Acquisition of capital assets(3,317,353) - (146,382) (117,574) (121,993) (3,703,302)
Sale of capital assets16,555 - - 5,050 5,983 27,588
Principal paid on bonds(645,000) - (95,000) (560,000) (195,000) (1,495,000)
Interest paid on bonds(148,283) - (54,831) (145,975) (26,815) (375,904)
Net cash provided by (used in)
capital and related financing activities(4,094,081) - (296,213) (818,499) (337,825) (5,546,618)
Cash flows from investing activities:
Net changes in investments(221,508) - - - 133,086 (88,422)
Investment income115,733 - - - 116,915 232,648
Net cash flows provided by
(used in) investing activities(105,775) - - - 250,001 144,226
Net increase (decrease)
in cash and cash equivalents2,528 146,825 53,665 8,920 62,605 274,543
Cash and cash equivalents - January 11,993 5,543 - - 11,287 18,823
Cash and cash equivalents - December 314,521$ 152,368$ 53,665$ 8,920$ 73,892$ 293,366$
Business-type Activities - Enterprise Funds
The accompanying notes are an integral part of these financial statements.
30
CITY OF EDINA, MINNESOTA
STATEMENT OF CASH FLOWS Statement 8
PROPRIETARY FUNDS
For The Year Ended December 31, 2005
Nonmajor
AquaticGolfEnterprise
UtilitiesLiquorCenterCourseFundsTotal
Business-type Activities - Enterprise Funds
Reconciliation of operating income to net cash
provided (used) by operating activities:
Operating income (loss) 2,118,936$ 1,003,411$ 177,832$ 47,355$ (546,545)$ 2,800,989$
Adjustments to reconcile operating income
(loss) to net cash flows provided by
(used in) operating activities:
Depreciation1,224,190 73,899 185,814 468,793 418,460 2,371,156
Changes in assets and liabilities:
Decrease (increase) in receivables225,532 1,710 - (1,010) 2,204 228,436
Decrease (increase) in
special assessments12,638 - - - - 12,638
Decrease (increase) in
due from other governments4,232 - - - - 4,232
Decrease (increase) in inventory(8,645) 45,839 - 619 1,140 38,953
Increase (decrease) in accounts payable(622,008) 9,423 (24,734) 25,309 46,281 (565,729)
Increase (decrease) in salaries payable1,851 2,548 13 3,638 5,925 13,975
Increase (decrease) in contracts payable(189,130) - (4,542) - (5,732) (199,404)
Increase (decrease) in
due to other governments(747) 12,431 1,018 179 (300) 12,581
Increase (decrease) in deposits1,972 - - 3,348 - 5,320
Increase (decrease) in unearned revenue- (268) - 4,988 721 5,441
Increase (decrease) in
compensated absences13,474 25,332 - 14,827 21,550 75,183
Total adjustments663,359 170,914 157,569 520,691 490,249 2,002,782
Net cash provided by
(used in) operating activities2,782,295$ 1,174,325$ 335,401$ 568,046$ (56,296)$ 4,803,771$
Noncash investing, capital and financing activities:
Increase (decrease) in fair
value of investments 6,922$ -$ -$ -$ (68,856)$ (61,934)$
The accompanying notes are an integral part of these financial statements.
31
CITY OF EDINA, MINNESOTA
STATEMENT OF FIDUCIARY NET ASSETS Statement 9
AGENCY FUNDS
December 31, 2005
Agency Funds
Assets
Cash 539,727$
Investments 135,000
Total assets 674,727$
Liabilities
Accounts payable 81,643$
Salaries payable 951
Due to other governmental units 592,133
Total liabilities 674,727$
The accompanying notes are an integral part of these financial statements.
32
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
33
Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of Edina (the City) was incorporated in 1888 and operates under the State of Minnesota Statutory
Plan B form of government. The governing body consists of a five-member City Council elected by voters
of the City.
The financial statements of the City have been prepared in conformity with generally accepted accounting
principles as applied to governmental units by the Governmental Accounting Standards Board (GASB).
The following is a summary of significant accounting policies.
A. FINANCIAL REPORTING ENTITY
In accordance with Governmental Accounting Standards Board (GASB) Statement No. 14, “The
Financial Reporting Entity” the City’s financial reporting entity consists of (a) the primary
government, (b) organizations for which the primary government is financially accountable, and
(c) other organizations for which the nature and significance of their relationship with the primary
government are such that exclusion would cause the reporting entity’s financial statements to be
misleading or incomplete. The primary government is financially accountable for the component
unit if it appoints a voting majority of the component unit’s governing body and is able to impose
its will on the component unit or there is a potential for the component unit to provide specific
financial benefits to, or impose specific financial burdens on, the primary government.
As required by generally accepted accounting principles, the financial statements of the reporting
entity include those of the City of Edina (the primary government) and its component units. The
component units discussed below are included in the City's reporting entity because of the
significance of their operational or financial relationships with the City.
COMPONENT UNITS
In conformity with generally accepted accounting principles, the financial statements of the
component unit have been included in the financial reporting entity as a blended component unit.
The Housing and Redevelopment Authority (HRA) is an entity legally separate from the City.
However, for financial reporting purposes, the HRA is reported as if it were part of the City's
operations because the members of the City Council serve as HRA board members and its activity
is confined to the City of Edina. The activity of the HRA is reported in the Capital Projects
Funds. Separate financial statements are not prepared for the HRA.
B. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS
The government-wide financial statements (i.e., the statement of net assets and the statement of
changes in net assets) report information on all of the nonfiduciary activities of the primary
government. Governmental activities, which normally are supported by taxes and
intergovernmental revenues, are reported separately from business-type activities, which rely to a
significant extent on fees and charges for support.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
34
The statement of activities demonstrates the degree to which the direct expenses of a given
function or business-type activity are offset by program revenues. Direct expenses are those that
are clearly identifiable with a specific function or business-type activity. Program revenues
include 1) charges to customers or applicants who purchase, use, or directly benefit from goods,
services, or privileges provided by a given function or business-type activity and 2) grants and
contributions that are restricted to meeting the operational or capital requirements of a particular
function or business type activity. Taxes and other items not included among program revenues
are reported instead as general revenues.
Separate financial statements are provided for governmental funds, proprietary funds, and
fiduciary funds, even though the latter are excluded from the government-wide financial
statements. Major individual governmental funds and major individual enterprise funds are
reported as separate columns in the fund financial statements. Aggregated information for the
remaining nonmajor governmental and enterprise funds is reported in a single column in the fund
financial statements
C. MEASUREMENT FOCUS, BASIS OF ACCOUNTING, AND FINANCIAL STATEMENT
PRESENTATION
The government-wide financial statements are reported using the economic resources
measurement focus and the accrual basis of accounting, as are the Proprietary Fund and Fiduciary
Fund financial statements. Revenues are recorded when earned and expenses are recorded when a
liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized
as revenues in the year for which they are levied. Grants and similar items are recognized as
revenue as soon as all eligibility requirements imposed by the provider have been met.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized as
soon as they are both measurable and available. Revenues are considered to be available when
they are collectible within the current period or soon enough thereafter to pay liabilities of the
current period. For this purpose, the City considers all revenues, except reimbursement grants, to
be available if they are collected within 60 days of the end of the current fiscal period.
Expenditures generally are recorded when a liability is incurred, as under accrual accounting.
However, debt service expenditures, as well as expenditures related to compensated absences and
claims and judgments are recorded only when payment is due.
Property taxes, special assessments, intergovernmental revenues, charges for services and interest
associated with the current fiscal period are all considered to be susceptible to accrual and so have
been recognized as revenues of the current fiscal period. Only the portion of special assessments
receivable due within the current fiscal period is considered to be susceptible to accrual as revenue
of the current period. All other revenue items are considered to be measurable and available only
when cash is received by the City.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
35
The City reports the following major governmental funds:
The general fund is the government’s primary operating fund. It accounts for all financial
resources of the general government, except those required to be accounted for in another
fund.
The debt service fund accounts for the payment of principal and interest on the General
Obligation Redevelopment, General Obligation Park Improvements and Tax Increment
Bonds.
The capital projects construction fund accounts for the various special assessment and state
aid projects throughout the City. This fund also provides financing for capital improvements
as designated in the City’s capital improvement budget.
The capital projects Housing and Redevelopment Authority fund is used to account for
revenues from several sources (property taxes, bond proceeds, investment earnings, etc.) that
are designated for housing and redevelopment.
The City reports the following major proprietary funds:
The utility fund accounts for the provision of water, sewer and recycling services to the City’s
residents.
The liquor fund accounts for the operation of the City’s three liquor stores.
The aquatic center fund accounts for the operation of the City’s aquatic center.
The golf course fund accounts for the operation of the City’s three golf courses and a golf
dome.
Additionally, the City reports the following fund type:
Agency - the police seizure and Public Safety Training Facility funds account for fees
collected for other government agencies and the payroll fund accounts for payroll deductions
withheld from employee paychecks but not yet sent to the appropriate party (includes federal
and state taxes, health care deductions, etc).
Private-sector standards of accounting and financial reporting issued prior to December 1, 1989,
generally are followed in both the government-wide and proprietary fund financial statements to
the extent that those standards do not conflict with or contradict guidance of the Governmental
Accounting Standards Board. Governments also have the option of following subsequent private-
sector guidance for their business-type activities and enterprise funds, subject to this same
limitation. The City has elected not to follow subsequent private-sector guidance.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
36
As a general rule the effect of interfund activity has been eliminated from the government-wide
financial statements. Exceptions to this general rule are transactions that would be treated as
revenues, expenditures or expenses if they involved external organizations, such as buying goods
and services or payments in lieu of taxes, are similarly treated when they involve other funds of
the City of Edina. Elimination of these charges would distort the direct costs and program
revenues reported for the various functions concerned.
Amounts reported as program revenues include 1) charges to customers or applicants for goods,
services, or privileges provided, 2) operating grants and contributions, and 3) capital grants and
contributions, including special assessments. Internally dedicated resources are reported as
general revenues rather than as program revenues. Likewise, general revenues include all taxes.
Proprietary funds distinguish operating revenues and expenses from nonoperating items.
Operating revenues and expenses generally result from providing services and producing and
delivering goods in connection with a proprietary fund’s principal ongoing operations. The
principal operating revenues of the utilities, liquor, aquatic center, golf course, arena, art center
and Edinborough Park/Centennial Lake enterprise funds are charges to customers for sales and
services. Operating expenses for enterprise funds include the cost of sales and services,
administrative expenses, and depreciation on capital assets. All revenues and expenses not
meeting this definition are reported as nonoperating revenues and expenses.
When both restricted and unrestricted resources are available for an allowable use, it is the City’s
policy to use restricted resources first, then unrestricted resources as they are needed.
Depreciation expense can be specifically identified by function and is included in the direct
expenses of each function. Interest on long-term debt is considered an indirect expense and is
reported separately on the Statement of Activities.
D. CASH AND INVESTMENTS
The City’s cash and cash equivalents are considered to be deposits and cash on hand.
Cash balances from all funds are pooled together and invested to the maximum extent at favorable
rates. This also allows certain funds to generate a temporary cash overdraft. Interest earned is
allocated as determined by the Investment Advisory Committee. The City provides temporary
advances to funds that have insufficient cash balances by means of an advance from another fund
shown as interfund receivables in the advancing fund, and an interfund payable in the fund with
the deficit, until adequate resources are received. These interfund balances are eliminated on the
government-wide financial statements.
The City reports its investments at fair value based on quoted market prices. Changes in fair value
of securities in the City’s investment portfolio are recorded as a net change in fair value of
investments in the City’s fund financial statements and within general revenues in the
government-wide financial statements. Restricted investments include investments held in escrow
for two crossover refundings further described in footnote 4.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
37
E. RECEIVABLES AND PAYABLES
During the course of operations, numerous transactions occur between individual funds for goods
provided or services rendered. Short-term interfund loans are classified as “due to/from other
funds.” All short-term interfund receivables and payables at December 31, 2005 are planned to be
eliminated in 2006. Any residual balances outstanding between the governmental activities and
business-type activities are reported in the government-wide financial statements as “internal
balances.”
Property taxes and special assessments receivables have been reported net of estimated
uncollectible accounts. Because utility bills are considered liens on property, no estimated
uncollectible amounts are established. Uncollectible amounts are not material for other
receivables and have not been reported.
F. REVENUE RECOGNITION
1. PROPERTY TAX REVENUE RECOGNITION
The City Council annually adopts a tax levy and certifies it to the County in December
(levy/assessment date) of each year for collection in the following year. The County is
responsible for billing and collecting all property taxes for itself, the City, the local
School District and other taxing authorities. Such taxes become a lien on January 1 and
are recorded as receivables by the City at that date. Real property taxes are payable (by
property owners) on May 15 and October 15 of each calendar year. Personal property
taxes are payable by taxpayers on February 28 and June 30 of each year. These taxes are
collected by the County and remitted to the City on or before July 7 and December 2 of
the same year. Delinquent collections for November and December are received the
following January. The City has no ability to enforce payment of property taxes by
property owners. The County possesses this authority.
GOVERNMENT-WIDE FINANCIAL STATEMENTS
The City recognizes property tax revenue in the period for which the taxes were levied.
Uncollectible property taxes are not material and have not been reported.
GOVERNMENTAL FUND FINANCIAL STATEMENTS
The City recognizes property tax revenue when it becomes both measurable and
available to finance expenditures of the current period. In practice, current and
delinquent taxes and State credits received by the City in July, December and January are
recognized as revenue for the current year. Taxes collected by the County by December
31 (remitted to the City the following January) and taxes and credits not received at the
year end are classified as delinquent and due from County taxes receivable. The portion
of delinquent taxes not collected by the City in January are fully offset by deferred
revenue because they are not available to finance current expenditures.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
38
2. SPECIAL ASSESSMENT REVENUE RECOGNITION
Special assessments are levied against benefited properties for the cost or a portion of the
cost of special assessment improvement projects in accordance with State Statutes.
These assessments are collectible by the City over a term of years usually consistent with
the term of the related bond issue. Collection of annual installments (including interest)
is handled by the County Auditor in the same manner as property taxes. Property owners
are allowed to (and often do) prepay future installments without interest or prepayment
penalties.
Once a special assessment roll is adopted, the amount attributed to each parcel is a lien
upon that property until full payment is made or the amount is determined to be excessive
by the City Council or court action. If special assessments are allowed to go delinquent,
the property is subject to tax forfeit sale. Pursuant to State Statutes, a property shall be
subject to a tax forfeit sale after three years unless it is homesteaded, agricultural or
seasonal recreational land in which event the property is subject to such sale after five
years.
GOVERNMENT-WIDE FINANCIAL STATEMENTS
The City recognizes special assessment revenue in the period that the assessment roll was
adopted by the City Council. Uncollectible special assessments are not material and have
not been reported.
GOVERNMENTAL FUND FINANCIAL STATEMENTS
Revenue from special assessments is recognized by the City when it becomes measurable
and available to finance expenditures of the current fiscal period. In practice, current and
delinquent special assessments received by the City are recognized as revenue for the
current year. Special assessments that are collected by the County by December 31
(remitted to the City the following January) and are also recognized as revenue for the
current year. All remaining delinquent, deferred and special deferred assessments
receivable in governmental funds are completely offset by deferred revenues.
G. INVENTORIES, PREPAID ITEMS AND DEFERRED CHARGES
Inventories of the Proprietary Funds are stated at cost and are recorded as expenditures when
consumed rather than when purchased.
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded
as prepaid items in both government-wide and fund financial statements.
Deferred charges represent deferred issuance costs.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
39
H. CAPITAL ASSETS
Capital assets, which include property, plant, equipment and parks, are reported in the applicable
governmental or business-type activities columns in the government-wide financial statements.
Capital assets are also reported in the proprietary fund financial statements but not in the
governmental fund financial statements.
Capital assets are defined by the government as assets with an initial, individual cost of more than
$5,000 (amount not rounded) and an estimated useful life in excess of three years. Such assets are
recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital
assets are recorded at estimated fair market value at the date of donation. The costs of normal
maintenance and repairs that do not add to the value of the asset or materially extend assets lives
are not capitalized.
Property, plant and equipment of the primary government is depreciated using the straight line
method over the following estimated useful lives:
Assets Life
Golf course 10 - 35 years
Land improvements 20 – 50 years
Buildings and structures 20 - 40 years
Furniture and office equipment 5 - 10 years
Vehicles and equipment 3 - 20 years
Parks 5 - 100 years
Distribution system 50 years
Collection system 10 - 50 years
Storm sewers 50 years
Wells 7 - 30 years
I. COMPENSATED ABSENCES
It is the City's policy to permit employees to accumulate earned but unused vacation and sick pay
benefits. All vacation pay is accrued when incurred in the government-wide and proprietary fund
financial statements. A liability for these amounts is reported in governmental funds only if they
have matured, for example, as a result of employee resignations and retirements. In accordance
with the provisions of Statement of Governmental Accounting Standards No. 16, Accounting for
Compensated Absences, no liability is recorded for nonvesting accumulating rights to receive sick
pay benefits. However, a liability is recognized for that portion of accumulating sick leave
benefits that is vested as severance pay. According to City policy, vested sick leave benefits are
liquidated into a health care savings plan upon separation.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
40
J. LONG-TERM OBLIGATIONS
In the government-wide financial statements and proprietary fund types in the fund financial
statements, long-term debt and other long-term obligations are reported as liabilities in the
applicable governmental activities, business-type activities, or proprietary fund type statement of
net assets. Bond premiums and discounts, as well as issuance costs, are deferred and amortized
over the life of the bond using the straight-line method. Bonds payable are reported net of the
applicable bond premium or discount. Bond issuance costs are reported as deferred charges and
amortized over the term of the related debt.
In the fund financial statements, governmental fund types recognize bond premiums and
discounts, as well as bond issuance costs, during the current period. The face amount of debt
issued plus any premium received is reported as other financing sources. Discounts on debt
issuances are reported as other financing uses. Issuance costs, whether or not withheld from the
actual debt proceeds received, are reported as debt service expenditures.
K. FUND EQUITY
In the fund financial statements, governmental funds report reservations of fund balance for
amounts that are not available for appropriation or are legally restricted by outside parties for use
for a specific purpose. Designations of fund balance represent tentative management plans that
are subject to change.
L. INTERFUND TRANSACTIONS
Interfund services provided and used are accounted for as revenues, expenditures or expenses.
Transactions that constitute reimbursements to a fund for expenditures/expenses initially made
from it that are properly applicable to another fund, are recorded as expenditures/expenses in the
reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed.
Interfund loans are reported as an interfund loan receivable or payable which offsets the
movement of cash between funds. All other interfund transactions are reported as transfers.
M. NET ASSETS
Net assets represent the difference between assets and liabilities in the government-wide and
proprietary fund financial statements. Net assets invested in capital assets, net of related debt,
consists of capital assets, net of accumulated depreciation, reduced by the outstanding balance of
any long-term debt used to build or acquire the capital assets. Net assets are reported as restricted
when there are limitations imposed on their use through external restrictions imposed by creditors,
grantors, or laws or regulations of other governments.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
41
N. USE OF ESTIMATES
The preparation of financial statements in accordance with generally accepted accounting
principles (GAAP) requires management to make estimates that affect amounts reported in the
financial statements during the reporting period. Actual results could differ from such estimates.
O. JOINT VENTURES
The City’s investment in joint venture is reported in the statement of net assets as governmental
activities capital assets and is equal to the City’s interest in the net assets of the joint venture. The
City’s interest is based on the allocation in the joint powers agreement.
P. FUND CONSOLIDATION
During 2005 the City consolidated the construction and revolving funds reported in the prior
year’s CAFR into the construction fund displayed in the current report in order to more accurately
reflect the similar nature of these funds. Accordingly, the beginning fund balance shown on the
Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds for
the construction fund is equal to the combined ending balances of the construction and revolving
funds from the same statement in the 2004 CAFR.
Q. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL
STATEMENTS
1. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL
FUND BALANCE SHEET AND THE GOVERNMENT-WIDE STATEMENT OF NET
ASSETS
The governmental fund balance sheet includes a reconciliation between fund balance – total
governmental funds and net assets – governmental activities as reported in the government-
wide statement of net assets. One element of that reconciliation explains that “long-term
liabilities, including bonds payable, are not due and payable in the current period and
therefore are not reported in the funds.” The details of this difference are as follows:
Bonds payable58,690,000$
Plus: issuance premium77,003
Less: issuance discount(319,593)
Less: deferred charge for issuance costs(327,359)
Accrued interest payable953,738
Compensated absences2,953,300
Net adjustment to reduce fund balance - total
governmental funds to arrive at net assets -
governmental activities62,027,089$
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
42
2. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL
FUND STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND
BALANCES AND THE GOVERNMENT-WIDE STATEMENT OF ACTIVITIES
The governmental fund statement of revenues, expenditures, and changes in fund balances
includes a reconciliation between net changes in fund balances – total governmental funds
and changes in net assets of governmental activities as reported in the government-wide
statement of activities. One element of that reconciliation explains that “Governmental funds
report capital outlays as expenditures. However, in the statement of activities the cost of
those assets is allocated over their estimated useful lives and reported as depreciation
expense.” The details of this difference are as follows:
Capital outlay7,103,797$
Depreciation expense(4,010,542)
Net adjustment to increase net changes in fund
balances - total governmental funds to arrive at
changes in net assets of governmental funds3,093,255$
Another element of that reconciliation states that “The net effect of disposals of capital assets
is to decrease net assets.” The details of this difference are as follows:
In the statement of activities, only the gain on the
sale of capital assets is reported. However, in the
governmental funds, the proceeds from the sale
increases financial resources. Thus, the change
in net assets differs from the change in fund
balance by the cost of the capital assets sold(139,350)$
The statement of activities reports losses arising from
the disposal of existing capital assets. Conversely,
governmental funds do not report any gain or loss
on a disposal of capital assets63,674
Net adjustment to decrease net changes in fund
balances - total governmental funds to arrive at
changes in net assets of governmental funds(75,676)$
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
43
Another element of that reconciliation states that “the issuance of long-term debt (e.g., bonds,
leases) provides current financial resources to governmental funds, while the repayment of
the long-term debt consumes the current financial resources of governmental funds. Neither
transaction, however, has any effect on net assets. Also, governmental funds report the effect
of issuance costs, premiums, discounts and similar items when debt is first issued whereas
these amounts are deferred and amortized in the statement of activities.” The details of this
difference are as follows:
Debt issued:
Bonds issued(15,816,165)$
Less issuance costs155,705
Less discounts36,275
Refunding bonds issued(16,764,721)
Less issuance costs84,575
Principal repayments:
General obligation debt6,830,000
Payment to escrow agent for refunding:
Principal refunding16,635,000
Net adjustment to increase net changes
in fund balances - total governmental
funds to arrive at changes in net
assets of governmental activities(8,839,331)$
Note 2 CASH AND INVESTMENTS
A. COMPONENTS OF CASH AND INVESTMENTS
Cash and investments at year-end consist of the following:
Deposits868,147$
Cash on hand16,185
Investments45,582,152
Investments held by trustee9,049,242
55,515,726$
Cash and investments are presented in the financial statements as follows:
Cash and cash equivalents - Statement of Net Assets344,605$
Investments - Statement of Net Assets45,447,152
Restricted investments - Statement of Net Assets9,049,242
Cash and investments - Statement of Fiduciary Net Assets674,727
55,515,726$
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
44
B. DEPOSITS
In accordance with applicable Minnesota Statutes, the City maintains deposits at depository banks
authorized by the City Council, including checking accounts, savings accounts and certificates of
deposit.
The following is considered the most significant risk associated with deposits:
Custodial credit risk – In the case of deposits, this is the risk that in the event of a bank
failure, the City’s deposits may be lost.
Minnesota Statutes require that all deposits be protected by federal deposit insurance,
corporate surety bond, or collateral. The market value of collateral pledged must equal
110% of the deposits not covered by federal deposit insurance or corporate surety bonds.
Authorized collateral includes treasury bills, notes, and bonds; issues of U.S. government
agencies; general obligations rated “A” or better; revenue obligations rated “AA” or
better; irrevocable standard letters of credit issued by the Federal Home Loan Bank; and
certificates of deposit. Minnesota Statutes require that securities pledged as collateral be
held in safekeeping in a restricted account at the Federal Reserve Bank or in an account
at a trust department of a commercial bank or other financial institution that is not owned
or controlled by the financial institution furnishing the collateral. The City’s investment
policy does not contain further restrictions on the types of investments the City may
invest in.
At year-end, the carrying amount of the City’s deposits was $868,147 while the balance
on the bank records was $1,433,756. At December 31, 2005, all deposits were fully
covered by federal depository insurance, surety bonds, or by collateral held by the City’s
agent in the City’s name.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
45
C. INVESTMENTS
The City has the following investments at year end:
RatingAgency< 11 to 55 to 1010 +Total
U.S. TreasuriesN/AN/A9,083,966$ 256,939$ 518,681$ 638,331$ 10,497,917$
SBA PoolsN/RN/A- - - 893,367 893,367
U.S. AgenciesAAA/AaaS&P/Mdy's644,478 3,905,368 218,355 3,646,132 8,414,333
U.S. AgenciesAA-/Aa2S&P/Mdy's- - 74,646 - 74,646
MunicipalsMIG1Mdy's10,037 - - - 10,037
MunicipalsAA-/Aa3S&P/Mdy's- 93,705 67,795 - 161,500
Commercial PaperA1/P1S&P/Mdy's25,293,078 - - - 25,293,078
Negotiable CD'sN/RN/A662,544 - - - 662,544
Interfund DebtN/RN/A- - 1,400,000 - 1,400,000
35,694,103$4,256,012$ 2,279,477$ 5,177,830$ 47,407,422$
Money Market*N/RN/A7,223,972
Total investments 54,631,394$
N/A - Not Applicable
N/R - Not Rated
* - The City's money market investments don't have maturities
Credit Risk
Investment
Interest Risk - Maturity Duration in Years
Investments are subject to various risks, the following of which are considered the most
significant:
Custodial credit risk – For investments, this is the risk that in the event of a failure of
the counterparty to an investment transaction (typically a broker-dealer) the City would
not be able to recover the value of its investments or collateral securities that are in the
possession of an outside party. The City’s investment policy doesn’t specifically address
this risk, but the City typically limits its exposure by purchasing insured or registered
investments, or by the control of who holds the securities.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
46
Credit risk – This is the risk that an issuer or other counterparty to an investment will
not fulfill its obligations. Minnesota Statutes limit the City’s investments to direct
obligations or obligations guaranteed by the United States or its agencies; shares of
investment companies registered under the Federal Investment Company Act of 1940
that receive the highest credit rating, are rated in one of the two highest rating categories
by a statistical rating agency, and all of the investments have a final maturity of thirteen
months or less; general obligations rated “AA” or better; general obligations of the
Minnesota Housing Finance Agency rated “A” or better; bankers’ acceptances of United
States banks eligible for purchase by the Federal Reserve System; commercial paper
issued by United States corporations or their Canadian subsidiaries, rated of the highest
quality category by at least two nationally recognized rating agencies, and maturing in
270 days or less; Guaranteed Investment Contracts guaranteed by a United States
commercial bank, domestic branch of a foreign bank, or a United States insurance
company, and with a credit quality in one of the top two highest categories; repurchase or
reverse repurchase agreements and securities lending agreements with financial
institutions qualified as a “depository” by the government entity, with banks that are
members of the Federal Reserve System with capitalization exceeding $10,000,000, that
are a primary reporting dealer in U.S. government securities to the Federal Reserve Bank
of New York, or certain Minnesota securities broker-dealers. The City’s investment
policies do not further address credit risk.
Concentration risk – This is the risk associated with investing a significant portion of
the City’s investment (considered 5 percent or more) in the securities of a single issuer,
excluding U.S. guaranteed investments (such as Treasuries), investment pools, and
mutual funds. The City’s investment policies do not limit the concentration of
investments. At year-end, the City’s investments include 8.5%, 8.2%, 7.3%, and 5.5% in
securities issued by FNMA, General Electric, Rhineland Funding, and Lockhart Funding,
respectively.
Interest rate risk – This is the risk of potential variability in the fair value of fixed rate
investment resulting in changes in interest rates (the longer the period for which an
interest rate is fixed, the greater the risk). The City’s investment policy does not limit the
duration of investments.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
47
Note 3 CAPITAL ASSETS
Capital asset activity for the year ended December 31, 2005 is as follows:
BeginningEnding
BalanceIncreasesDecreasesBalance
Governmental activities:
Capital assets not being depreciated:
Land12,854,384$ -$ -$ 12,854,384$
Investment in joint venture1,452,465 - - 1,452,465
Construction in progress14,451,474 6,614,887 (15,670,427) 5,395,934
Total capital assets not being depreciated28,758,323 6,614,887 (15,670,427) 19,702,783
Capital assets being depreciated:
Land improvements28,849,248 - (7,132,186) 21,717,062
Buildings and structures28,478,580 1,934,848 - 30,413,428
Furniture and office equipment4,417,879 18,814 (1,857,442) 2,579,251
Vehicles and equipment10,522,317 5,372,045 (3,357,509) 12,536,853
Infrastructure- 20,316,987 - 20,316,987
Parks10,778,675 609,148 (432,402) 10,955,421
Total capital assets being depreciated83,046,699 28,251,842 (12,779,539) 98,519,002
Less accumulated depreciation for:
Land improvements(10,905,219) (838,509) 2,636,112 (9,107,616)
Buildings and structures(6,741,761) (846,736) - (7,588,497)
Furniture and office equipment(592,786) (205,788) 24,381 (774,193)
Vehicles and equipment(5,191,764) (982,948) 692,104 (5,482,608)
Infrastructure- (3,561,501) - (3,561,501)
Parks(4,696,834) (381,480) 65,181 (5,013,133)
Total accumulated depreciation(28,128,364) (6,816,962) 3,417,778 (31,527,548)
Total capital assets being depreciated, net54,918,335 21,434,880 (9,361,761) 66,991,454
Governmental activities capital assets, net 83,676,658$ 28,049,767$ (25,032,188)$86,694,237$
Certain capital assets were reclassified to different categories during the year, and these reclassifications
are reflected in the “Increases” and “Decreases” columns above.
GASB Statement No. 34, Basic Financial Statements – and Management’s Discussion and Analysis – for
State and Local Governments permits a phase-in period for reporting major infrastructure assets
retroactively through the City’s fiscal year ending December 31, 2006. The costs of certain infrastructure
asset networks incurred prior to January 1, 2002, primarily streets, sidewalks, traffic signals and street
lighting systems have not been capitalized. Estimated historical cost data for these networks has not yet
been compiled; when this process has been finalized, the City will capitalize retroactively those costs
associated with each network categorized as major, before the end of the phase-in period.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
48
BeginningEnding
BalanceIncreasesDecreasesBalance
Business-type activities:
Capital assets not being depreciated:
Land1,088,965$ -$ -$ 1,088,965$
Construction in progress5,594,422 2,983,944 (5,944,801) 2,633,565
Total capital assets not being depreciated6,683,387 2,983,944 (5,944,801) 3,722,530
Capital assets being depreciated:
Golf course4,615,307 - - 4,615,307
Land improvements3,285,547 34,950 - 3,320,497
Buildings and structures15,595,881 166,327 - 15,762,208
Furniture and office equipment149,436 - - 149,436
Vehicles and equipment4,668,427 277,741 (124,084) 4,822,084
Distribution and collection system32,915,025 5,024,893 - 37,939,918
Storm sewers12,996,663 866,673 - 13,863,336
Wells2,379,175 293,575 - 2,672,750
Lease property capital lease468,580 - - 468,580
Total capital assets being depreciated77,074,041 6,664,159 (124,084) 83,614,116
Less accumulated depreciation for:
Golf course(1,552,024) (152,310) - (1,704,334)
Land improvements(1,605,081) (161,627) - (1,766,708)
Buildings and structures(7,389,050) (625,170) - (8,014,220)
Furniture and office equipment(64,588) (21,415) - (86,003)
Vehicles and equipment(2,367,705) (336,688) 115,616 (2,588,777)
Distribution and collection system(15,429,330) (716,744) - (16,146,074)
Storm sewers(5,468,514) (274,659) - (5,743,173)
Wells(1,071,858) (82,543) - (1,154,401)
Lease property capital lease(468,580) - - (468,580)
Total accumulated depreciation(35,416,730) (2,371,156) 115,616 (37,672,270)
Total capital assets being depreciated, net41,657,311 4,293,003 (8,468) 45,941,846
Business-type activities capital assets, net48,340,698$ 7,276,947$ (5,953,269)$ 49,664,376$
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
49
Depreciation expense was charged to functions/programs of the primary government as follows:
Governmental activities:
General government494,547$
Public safety484,797
Public works1,529,836
Parks1,501,362
Total depreciation expense - governmental activities4,010,542$
Business-type activities:
Utilities1,224,190$
Liquor73,899
Aquatic Center185,814
Golf Course468,793
Arena303,544
Art Center28,669
Edinborough Park/Centennial Lakes86,247
Total depreciation expense - business-type activities2,371,156$
CONSTRUCTION COMMITMENTS
At December 31, 2005, the City had construction project contracts in progress. The commitments related
to the remaining contract balances are summarized as follows:
ContractRemaining
Project #Project DescriptionAmountCommitment
N/AGymnasiums3,453,834$ 2,279,548$
05-5 EngStreet/Sidewalk Reconstruction977,651 39,074
05-6 EngStreet/Sidewalk Reconstruction48,706 6,485
05-7 EngStreet/Sidewalk Reconstruction290,795 23,664
05-8 EngStreet/Sidewalk Reconstruction438,480 65,964
05-10 EngStreet/Sidewalk Reconstruction168,719 8,182
05-3 PWWatermain98,850 82,250
2,505,167$
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
50
Note 4 LONG-TERM DEBT
The City has four types of bonded debt outstanding at December 31, 2005: tax increment bonds, general
obligation bonds, public project revenue bonds and G.O. revenue bonds. The first type of bond is payable
solely from tax increment monies with any deficiency to be provided for by general property taxes. The
second type is payable from general property taxes or special assessments. The third type is payable solely
from annual appropriation lease payments received from the City of Edina pursuant to a lease between the
Edina Housing and Redevelopment Authority and the City. The fourth type is payable primarily from
enterprise revenue with any deficiency to be provided for by general property taxes. The reporting entity’s
long-term debt is segregated between the amounts to be repaid from governmental activities and amounts
to be repaid from business-type activities.
GOVERNMENTAL ACTIVITIES
As of December 31, 2005, the governmental long-term bonded debt of the financial reporting entity
consisted of the following:
Final
InterestIssueMaturityOriginalPayable
RatesDateDateIssue12/31/2005
Tax Increment Bonds:
Tax Increment Bonds, Series 1997B4.50-5.204/1/19972/1/20135,090,000$ 3,865,000$
Tax Increment Bonds, Series 2000A4.30-4.809/6/20002/1/20112,620,000 1,720,000
Tax Increment Bonds, Series 2002B3.00%8/5/20022/1/20091,400,000 1,400,000
Tax Increment Taxable Refunding
Bonds of 2003B1.128-1.7493/1/20032/1/20066,570,000 1,675,000
Tax Increment Refunding Bonds,
Series 2005B3.00%7/19/20052/1/200910,520,000 10,520,000
Tax Increment Taxable Refunding
Bonds, Series 2005C3.75-4.257/19/20052/1/20096,220,000 6,220,000
Tax Increment Refunding Bonds,
Series 2005D3.00-3.407/19/20052/1/20133,505,000 3,505,000
Total Tax Increment Bonds35,925,000 28,905,000
General Obligation Bonds:
General Obligation - Park &
Recreation, Series 1996B4.25-5.758/1/19962/1/20178,090,000 5,950,000
General Obligation Equipment
Certificates, Series 2003A1.05-2.043/1/20032/1/20081,540,000 440,000
General Obligation - Park &
Recreation Refunding, 2005A3.50-4.007/19/20052/1/20175,375,000 5,375,000
General Obligation - Permanent
Improvement Revolving, 2005E3.00-3.759/13/20052/1/20161,460,000 1,460,000
Total General Obligation Bonds16,465,000 13,225,000
Public Project Revenue Bonds:
Public Project Revenue, Series 20024.00-5.251/1/20022/1/202112,410,000 11,135,000
Public Project Revenue, Series 20053.50-4.139/13/20055/1/20265,425,000 5,425,000
Total Public Project Revenue Bonds17,835,000 16,560,000
Total bonded indebtedness - governmental activities70,225,000$ 58,690,000$
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
51
BUSINESS-TYPE ACTIVITIES
Annual debt service requirements to maturity for the City’s bonds are as follows:
Final
InterestIssueMaturityOriginalPayable
RatesDateDateIssue12/31/2005
Revenue Bonds:
Recreational Facility Bonds, Series 1999B3.70-4.455/3/19991/1/20133,270,000$ 2,530,000$
Recreational Facility Bonds, Series 2001A2.25-4.6511/1/20011/1/20174,620,000 2,945,000
Utility Revenue Bonds, Series 1999A3.20-4.205/3/19992/1/20093,600,000 1,590,000
Utility Revenue Bonds, Series 2003C1.10-3.553/1/20032/1/20133,200,000 2,625,000
Total bonded indebtedness - business-type activities14,690,000$ 9,690,000$
PrincipalInterestPrincipalInterestPrincipalInterest
20068,445,000$ 902,607$ 6,095,000$ 421,673$ 480,000$ 779,778$
20074,795,000 625,606 705,000 243,881 690,000 725,855
20085,650,000 445,694 725,000 221,556 715,000 696,118
20095,890,000 244,236 585,000 200,031 745,000 665,193
2010805,000 125,820 605,000 179,581 780,000 632,880
2011-20153,320,000 152,154 3,235,000 562,935 4,440,000 2,595,635
2016-2020- - 1,275,000 48,331 5,610,000 1,402,028
2021-2025- - - - 2,705,000 290,457
2026- - - - 395,000 8,147
Total28,905,000$ 2,496,117$ 13,225,000$ 1,877,988$ 16,560,000$ 7,796,091$
PrincipalInterest
20061,545,000$ 328,868$
20071,595,000 276,999
20081,560,000 221,821
20091,600,000 163,543
2010715,000 120,095
2011-20152,500,000 209,848
2016-2020175,000 8,212
Total9,690,000$ 1,329,386$
Year Ending
December 31
Year Ending
December 31
Revenue Bonds
Governmental Activities
Business-type Activities
GeneralPublic ProjectTax
Increment BondsObligation BondsRevenue Bonds
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
52
CHANGE IN LONG-TERM LIABILITIES
Long-term liability activity for the year ended December 31, 2005, was as follows:
BeginningEndingDue Within
BalanceAdditionsReductionsBalanceOne Year
Governmental activities:
Bonds payable:
Tax increment30,760,000$ 20,245,000$ (22,100,000)$ 28,905,000$ 8,445,000$
General obligation7,295,000 6,835,000 (905,000) 13,225,000 6,095,000
Public project revenue11,595,000 5,425,000 (460,000) 16,560,000 480,000
Less deferred amounts:
Discount on bonds(324,906) (36,275) 41,588 (319,593) -
Premiums30,780 75,886 (29,663) 77,003 -
Total bonds payable49,355,874 32,544,611 (23,453,075) 58,447,410 15,020,000
Compensated absences2,953,776 1,296,212 (1,296,688) 2,953,300 295,330
Governmental activity
Long-term liabilities52,309,650$ 33,840,823$ (24,749,763)$61,400,710$ 15,315,330$
Business-type activities:
Bonds payable:
Revenue bonds11,185,000$ -$ (1,495,000)$ 9,690,000$ 1,545,000$
Less deferred amounts:
Discount on bonds(52,612) - 9,411 (43,201) -
Total bonds payable11,132,388 - (1,485,589) 9,646,799 1,545,000
Compensated absences761,997 312,800 (237,618) 837,179 83,717
Business-type activity
Long-term liabilities11,894,385$ 312,800$ (1,723,207)$ 10,483,978$ 1,628,717$
For governmental activities, compensated absences are generally liquidated by the general fund.
The City issued $5,375,000 of General Obligation Park & Recreation Refunding Bonds, Series 2005A
to provide resources for a “crossover refunding” of the 2007 through 2017 maturities of the
$5,575,000 General Obligation Park & Recreation Bonds, Series 1996B. The proceeds of the 2005
issue have been placed in an escrow account pending the February 1, 2006 call date of the refunded
issue. The crossover refunding includes $199,747 of City funds in addition to the refunding bond
proceeds. This crossover refunding was undertaken to reduce total debt service payments by $957,250
and resulted in an economic gain of $565,887.
The City also issued $10,520,000 of General Obligation Tax Increment Refunding Bonds, Series
2005B for a current refunding of $10,460,000 General Obligation Tax Increment Refunding Bonds,
Series 2000C. The reacquisition price exceeded the net carrying amount of the old debt by $77,779.
This amount is being netted against the new debt and amortized over the new debt’s life, which is the
same as the refunded debt. The transaction was undertaken to reduce total debt service payments by
$305,894 and resulted in an economic gain of $291,987.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
53
The City also issued $6,220,000 of General Obligation Taxable Tax Increment Refunding Bonds,
Series 2005C for a current refunding of $6,175,000 General Obligation Taxable Tax Increment
Refunding Bonds, Series 1996A. The reacquisition price exceeded the net carrying amount of the old
debt by $45,022. This amount is being netted against the new debt and amortized over the new debt’s
life, which is the same as the refunded debt. The transaction was undertaken to reduce total debt
service payments by $224,488 and resulted in an economic gain of $209,067.
The City also issued $3,505,000 of General Obligation Tax Increment Refunding Bonds, Series 2005D
to provide resources for a “crossover refunding” of the 2007 through 2013 maturities of the
$3,460,000 General Obligation Tax Increment Bonds, Series 1997B. The proceeds of the 2005 issue
have been placed in an escrow account pending the February 1, 2006 call date of the refunded issue.
This crossover refunding was undertaken to reduce total debt service payments by $263,373 and
resulted in an economic gain of $229,532.
The City also issued $1,460,000 of General Obligation Permanent Improvement Revolving Bonds,
Series 2005E to provide financing for infrastructure improvements. The City anticipates that special
assessments to benefited properties will be sufficient to pay future debt service on this issue.
The City of Edina Housing and Redevelopment Authority (HRA) issued $5,425,000 of Public Project
Revenue Bonds to provide funds for acquisition, construction and furnishing of two gymnasiums in
Edina.
Note 5 LEGAL DEBT MARGIN
The City is subject to a statutory limitation by the State of Minnesota for bonded indebtedness payable
principally from property taxes. The City of Edina's legal debt margin for 2005 is computed as follows:
December 31, 2005
Market Value (after fiscal disparities)8,693,345,900$
Debt Limit (2% of Market Value)173,866,918$
Amount of debt applicable to debt limit:
Total bonded debt68,380,000$
Less:
Tax increment bonds(28,905,000)
Public project revenue bonds(16,560,000)
Revenue bonds(9,690,000)
Cash and investments in related Debt Service Funds(1,631,162)
Total debt applicable to debt limit11,593,838$
Legal debt margin 162,273,080$
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
54
Note 6 DEFINED BENEFIT PENSION PLANS - STATEWIDE
A. PLAN DESCRIPTION
All full-time and certain part-time employees of the City of Edina are covered by defined benefit
plans administered by the Public Employees Retirement Association of Minnesota (PERA).
PERA administers the Public Employees Retirement Fund (PERF) and the Public Employees
Police and Fire Fund (PEPFF) which are cost-sharing, multiple-employer retirement plans. These
plans are established and administered in accordance with Minnesota Statute, Chapters 353 and
356.
PERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated Plan
members are covered by Social Security and Basic Plan members are not. All new members must
participate in the Coordinated Plan. All police officers, firefighters and peace officers who
qualify for membership by statute are covered by the PEPFF.
PERA provides retirement benefits as well as disability benefits to members, and benefits to
survivors upon death of eligible members. Benefits are established by State Statute, and vest after
three years of credited service. The defined retirement benefits are based on a member’s highest
average salary for any five successive years of allowable service, age, and years of credit at
termination of service.
Two methods are used to compute benefits for PERF’s Coordinated and Basic Plan members.
The retiring member receives the higher of a step-rate benefit accrual formula (Method 1) or a
level accrual formula (Method 2). Under Method 1, the annuity accrual rate for a Basic Plan
member is 2.2% of average salary for each of the first 10 years of service and 2.7% for each
remaining year. The annuity accrual rate for a Coordinated Plan member is 1.2% of average
salary for each of the first 10 years and 1.7% for each remaining year. Under Method 2, the
annuity accrual rate is 2.7% of average salary for Basic Plan members and 1.7% for Coordinated
Plan members for each year of service. For PEPFF members, the annuity accrual rate is 3.0% for
each year of service. For all PEPFF and PERF members hired prior to July 1, 1989 whose annuity
is calculated using Method 1, a full annuity is available when age plus years of service equal 90.
Normal retirement age is 55 for PEPFF and 65 for Basic and Coordinated members hired prior to
July 1, 1989. Normal retirement age is the age for unreduced Social Security benefits capped at
66 for Coordinated members hired on or after July 1, 1989. A reduced retirement annuity is also
available to eligible members seeking early retirement.
There are different types of annuities available to members upon retirement. A 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.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
55
The benefit provisions stated in the previous paragraphs of this section are current provisions and
apply to active plan participants. Vested, terminated employees who are entitled to benefits but
are not receiving them yet are bound by the provisions in effect at the time they last terminated
their public service.
PERA issues a publicly available financial report that includes financial statements and required
supplementary information for PERF and PEPFF. That report may be obtained on the internet at
www.mnpera.org, by writing to PERA at 60 Empire Drive #200, St. Paul, Minnesota, 55103-2088
or by calling (651) 296-7460 or 1-800-652-9026.
B. FUNDING POLICY
Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. These
statutes are established and amended by the state legislature. The City makes annual contributions
to the pension plans equal to the amount required by state statutes. PERF Basic Plan members and
Coordinated Plan members were required to contribute 9.10% and 5.10%, respectively, of their
covered salary in 2005. Contribution rates in the Coordinated Plan will increase in 2006 to 5.5%.
PEPFF members were required to contribute 6.20% of their covered salary in 2005. That rate will
increase to 7.0% in 2006. The City of Edina is required to contribute the following percentages of
annual covered payroll: 11.78% for Basic Plan PERF members, 5.53% for Coordinated Plan
PERF members, and 9.30% for PEPFF members. Employer contribution rates for the
Coordinated Plan and PEPFF will increase to 6.0% and 10.5% respectively, effective January 1,
2006. The City’s contributions to the Public Employees Retirement Fund for the years ending
December 31, 2005, 2004 and 2003 were $619,212, $614,321 and $569,890, respectively. The
City’s contributions to the Public Employees Police and Fire Fund for the years ending December
31, 2005, 2004 and 2003 were $539,000, $537,552 and $486,690, respectively. The City’s
contributions were equal to the contractually required contributions for each year as set by state
statute.
C. PUBLIC EMPLOYEES RETIREMENT ASSOCIATION (PERA) - DEFINED
CONTRIBUTION
PLAN DESCRIPTION
Three council members of the City of Edina are covered by the Public Employees Defined
Contribution Plan (PEDCP), a multiple-employer deferred compensation plan administered by the
Public Employees Retirement Association of Minnesota (PERA). The PEDCP is a tax qualified
plan under Section 401(a) of the Internal Revenue Code and all contributions by or on behalf of
employees are tax deferred until time of withdrawal.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
56
Plan benefits depend solely on amounts contributed to the plan plus investment earnings, less
administrative expenses. Minnesota Statutes, Chapter 353D.03, specifies the employee and
employer contribution rates for those qualified personnel who elect to participate. An eligible
elected official who decides to participate contributes 5 percent of salary which is matched by the
elected official's employer. For ambulance service personnel, employer contributions are
determined by the employer, and for salaried employees must be a fixed percentage of salary.
Employer contributions for volunteer personnel may be a unit value for each call or period of alert
duty. Employees who are paid for their services may elect to make member contributions in an
amount not to exceed the employer share. Employer and employee contributions are combined
and used to purchase shares in one or more of the seven accounts of the Minnesota Supplemental
Investment Fund. For administering the plan, PERA receives 2 percent of employer contributions
and four-tenths of one percent of the assets in each member's account annually.
Total contributions made by the City during fiscal year 2005 were:
Required
EmployeesEmployerEmployeesEmployerRates
PEDCP859$ 859$ 5.00%5.00%5.00%
Amount% of Coverd Payroll
Note 7 INTERFUND RECEIVABLES, PAYABLES, AND TRANSFERS
The composition of internal balances as of December 31, 2005, is as follows:
Payable FundAmount
GeneralDebt Service3,000$
Construction1,800,000
Debt ServiceGeneral200,000
Housing & Redevelopment AuthorityGeneral435
LiquorConstruction500,000
Utilities280,000
Aquatic CenterGolf Course630,000
CommunicationCommunity Development Block Grant11,000
ArenaEdinborough Park/Centennial Lakes25,000
Total 3,449,435$
Receivable Fund
The City’s interfund receivables and payables eliminate what would have been negative cash balances.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
57
DebtNonmajor
ServiceConstructionBusiness-typeTotal
Transfer out:
General Fund-$ 50,000$ -$ 50,000$
Construction Fund67,886 - 45,000 112,886
HRA Fund6,792,983 - - 6,792,983
Utilities Fund- 100,000 - 100,000
Liquor Fund- 786,500 141,000 927,500
6,860,869$ 936,500$ 186,000$ 7,983,369$
Transfer In:
Interfund transfers allow the City to allocate financial resources to the funds that receive benefit from
services provided by another fund. Many of the City’s interfund transfers fall under that category. Non-
routine transfers include the following:
1. The liquor fund transferred $786,500 to the construction fund to fund ongoing capital
improvement needs, as well as $80,000 and $61,000 to the arena and art center funds,
respectively, to subsidize operations.
2. The general fund transferred $50,000 to the construction fund to fund the capital improvement
program.
Note 8 TAX INCREMENT DISTRICTS
The City of Edina is the administering authority for the following Tax Increment Districts:
District number 1200 (50th and France Commercial Area) is a redevelopment district established in 1974
pursuant to Minnesota Statutes with a termination date of 2009.
District number 1201 (Southeast Edina Redevelopment District – Edinborough) is a redevelopment district
established in 1977 pursuant to Minnesota Statutes with a termination date of 2009.
District number 1202 (Grandview Commercial Area) is a redevelopment district established in 1984
pursuant to Minnesota Statutes with a termination date of 2010.
District number 1203 (Southeast Edina Redevelopment District – Centennial Lakes) is a redevelopment
district established in 1988 pursuant to Minnesota Statutes with a termination date of 2016.
District number 1207 (70th and Cahill Economic Development District) is an economic district established
in 1990 pursuant to Minnesota Statutes with a decertification date of 2000. Increment previously collected
is available for expenditures within the larger development district that includes the Wooddale – Valley
View commercial area. Tax capacity and debt for this district is not included in the following schedule as
county reports no longer indicate captured tax capacity for this district and no debt is outstanding.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
58
The following table reflects values as of December 31, 2005:
TIF #1200TIF #1201TIF #1202TIF #1203Total
Original tax capacity112,826$ 94,319$ 164,885$ 229,691$ 601,721$
Current tax capacity1,011,121 2,884,000 1,233,622 2,803,804 7,932,547
Tax capacity change898,295 2,789,681 1,068,737 2,574,113 7,330,826
Captured tax capacity value:
Retained captured tax capacity 898,295$ 2,789,681$ 1,068,737$ 2,574,113$ 7,330,826$
Total bonds issued
(general obligation) *5,360,000$ 22,445,000$ 9,637,555$ 39,354,724$ 76,797,279$
Amounts redeemed5,360,000 20,770,000 6,517,555 15,244,724 47,892,279
Outstanding bonds at
December 31, 2005-$ 1,675,000$ 3,120,000$ 24,110,000$ 28,905,000$
* - Amount for district #1203 includes $3,460,000 refunding that will be paid from escrow on February 1, 2006.
Note 9 CONTINGENCIES
A. RISK MANAGEMENT
The City is exposed to various risks of loss related to torts, theft of, damage to and destruction of
assets; errors and omissions; injuries to employees; and natural disasters.
Worker’s compensation insurance is provided through the League of Minnesota Cities Insurance
Trust (LMCIT). The City has a $10,000 deductible per occurrence, with a $500,000 annual
maximum.
Automobile and general liability coverage is provided through an insurance company. The City
pays an annual premium for this coverage and all claims are paid from the plan up to the annual
maximum of $600,000. The City is not subject to a deductible for automobile or general liability
coverage.
Property coverage is also provided by an insurance company. The City pays an annual premium
for this coverage, and all claims are paid for by the plan. The City has $2,500 - $25,000
deductibles per occurrence depending on claim type, with an annual maximum of $83,446,936.
Police professional insurance coverage is provided by an insurance company. The City pays an
annual premium for this coverage, and has a $10,000 deductible per occurrence, with a $500,000
annual maximum.
The City has designated $1,025,765 in the general fund to finance potential uninsured loss.
Settlement claims have not exceeded insurance coverage for each of the past three years.
There were not significant reductions in insurance coverage during 2005.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
59
B. LITIGATION
The City attorney has indicated that existing and pending lawsuits, claims and other actions in
which the City is a defendant are either covered by insurance; of an immaterial amount; or, in the
judgment of the City attorney, remotely recoverable by plaintiffs.
C. FEDERAL AND STATE FUNDS
The City receives financial assistance from federal and state governmental agencies in the form of
grants. The disbursement of funds received under these programs generally requires compliance
with the terms and conditions specified in the grant agreements and is subject to audit by the
grantor agencies. Any disallowed claims resulting from such audits could become a liability of
the applicable fund. However, in the opinion of management, any such disallowed claims will not
have a material effect on any of the financial statements of the individual fund types included
herein or on the overall financial position of the City at December 31, 2005.
D. TAX INCREMENT DISTRICTS
The City’s tax increment districts are subject to review by the State of Minnesota Office of the
State Auditor (OSA). Any disallowed claims or misuse of tax increments could become a liability
of the applicable fund. Management is not aware of any instances of noncompliance which would
have a material effect on the financial statements.
Note 10 CONDUIT DEBT OBLIGATION
As of December 31, 2005, the City of Edina had 3 series of Housing and Health Care Revenue Bonds, with
an aggregate principal amount payable of $30,030,000. The bonds are payable solely from revenues of the
respective organizations and do not constitute an indebtedness of the City, and are not a charge against its
general credit or taxing power. Accordingly, the bonds are not reported as liabilities in the accompanying
financial statements.
Note 11 JOINT VENTURE
The City is a participant with the City of Bloomington, the City of Eden Prairie and the Metropolitan
Airport Commission in a joint venture to construct and operate a facility to be used for the training of law
enforcement officers and firefighters. The South Metro Public Safety Training Facility Association (PSTF)
is governed by a Board consisting of one representative from each Member. On dissolution of the
Association, the Facility shall revert to the City of Edina, and all remaining assets shall be divided among
the members based on the Cost Sharing Formula. In accordance with the joint venture agreement, each
member of the association will share in the cost of the construction and operation based on the Cost
Sharing Formula. The City’s net investment is reported in the governmental activities capital assets. The
City’s equity interest in the PSTF was $1,452,465. Complete financial statements for PSTF can be
obtained from the City of Edina, 4801 West 50th Street, Edina, MN 55424.
CITY OF EDINA, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
60
Note 12 DESIGNATIONS AND RESERVATIONS OF FUND BALANCE
At December 31, 2005 the City had designated and reserved portions of its various fund balances through
legal restriction and City Council authorization. A summary of such designations is as follows:
December 31, 2005
General Fund:
Reserved for prepaid items223,351$
Designated for parkland dedication104,118
Designated for unrealized investment gains/losses37,983
Designated for equipment and other commitments2,847,475
Designated for insurance and severance1,025,765
Designated for cash flow7,580,092
Debt Service Fund:
Reserved for debt service11,014,746
Construction Fund:
Reserved for encumbrances2,422,917
Reserved for special projects354,649
Designated for capital improvements5,192,017
30,803,113$
CITY OF EDINA, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION Statement 10
BUDGETARY COMPARISON SCHEDULE - GENERAL FUND
For The Year Ended December 31, 2005
Variance with
2005Final Budget -
ActualOver
OriginalFinalAmounts(Under)
Revenues:
General property taxes:
Current17,143,594$ 17,143,594$ 17,178,755$ 35,161$
Penalties and interest15,000 15,000 12,388 (2,612)
Total general property taxes17,158,594 17,158,594 17,191,143 32,549
Licenses and permits:2,025,193 2,025,193 3,240,622 1,215,429
Intergovernmental:
Federal:51,400 51,400 353,128 301,728
State:
Municipal state aid195,000 195,000 195,000 -
Other56,634 56,634 123,432 66,798
State aid - police 310,000 310,000 354,587 44,587
Health programs120,000 120,000 121,198 1,198
Total intergovernmental733,034 733,034 1,147,345 414,311
Charges for services:
Building Department1,800 1,800 6,365 4,565
City Clerk- - 12,361 12,361
Fire Department35,600 35,600 29,373 (6,227)
Ambulance fees1,081,500 1,081,500 1,372,705 291,205
Police Department224,300 224,300 235,486 11,186
Engineering121,800 121,800 161,172 39,372
Health Department6,300 6,300 8,974 2,674
Planning Department27,000 27,000 28,342 1,342
Housing Foundation Contract31,100 31,100 11,264 (19,836)
HRA Services20,000 20,000 24,166 4,166
Assessing Searches- - 20 20
Park Registration77,250 77,250 88,904 11,654
Senior Center103,169 103,169 99,955 (3,214)
Other fees6,500 6,500 5,063 (1,437)
50th & France Assessment68,000 68,000 68,000 -
Charges to other funds263,616 263,616 263,616 -
Total charges for services2,067,935 2,067,935 2,415,766 347,831
Fines and forfeits900,000 900,000 742,917 (157,083)
Miscellaneous:
Rental of property280,000 280,000 283,595 3,595
Investment income110,000 110,000 181,784 71,784
Donations- - 116,747 116,747
Other5,000 5,000 32,716 27,716
Total miscellaneous395,000 395,000 614,842 219,842
Total revenues23,279,756 23,279,756 25,352,635 2,072,879
Budgeted Amounts
61
CITY OF EDINA, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION Statement 10
BUDGETARY COMPARISON SCHEDULE - GENERAL FUND (CONTINUED)
For The Year Ended December 31, 2005
Variance with
2005Final Budget -
ActualUnder
OriginalFinalAmounts(Over)
Expenditures:
General government:
Mayor and Council:
Current:
Personal services31,137$ 31,137$ 28,382$ 2,755$
Contractual services4,700 4,700 5,579 (879)
Commodities1,100 1,100 1,271 (171)
Central services37,044 37,044 41,474 (4,430)
Total mayor and council73,981 73,981 76,706 (2,725)
Administration:
Current:
Personal services748,072 748,072 735,375 12,697
Contractual services142,300 142,300 135,790 6,510
Commodities2,500 2,500 2,894 (394)
Central services60,480 60,480 66,668 (6,188)
Total current953,352 953,352 940,727 12,625
Capital outlay5,821 5,821 934 4,887
Total administration959,173 959,173 941,661 17,512
Planning:
Current:
Personal services310,691 310,691 304,826 5,865
Contractual services15,500 15,500 14,880 620
Commodities1,400 1,400 1,351 49
Central services39,180 39,180 43,543 (4,363)
Total current366,771 366,771 364,600 2,171
Capital outlay1,800 1,800 - 1,800
Total planning368,571 368,571 364,600 3,971
Finance:
Current:
Personal services436,490 436,490 426,703 9,787
Contractual services96,000 96,000 93,592 2,408
Commodities2,100 2,100 938 1,162
Central services44,700 44,700 49,411 (4,711)
Total current579,290 579,290 570,644 8,646
Capital outlay5,820 5,820 3,126 2,694
Total finance585,110 585,110 573,770 11,340
Election:
Current:
Personal services90,547 90,547 86,121 4,426
Contractual services14,944 14,944 10,842 4,102
Commodities5,280 5,280 5,975 (695)
Central services6,696 6,696 7,117 (421)
Total current117,467 117,467 110,055 7,412
Capital outlay- - - -
Total election117,467 117,467 110,055 7,412
Budgeted Amounts
62
CITY OF EDINA, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION Statement 10
BUDGETARY COMPARISON SCHEDULE - GENERAL FUND (CONTINUED)
For The Year Ended December 31, 2005
Variance with
2005Final Budget -
ActualUnder
OriginalFinalAmounts(Over)
Budgeted Amounts
Assessing:
Current:
Personal services568,831$ 568,831$ 560,688$ 8,143$
Contractual services100,640 100,640 83,243 17,397
Commodities2,400 2,400 1,390 1,010
Central services56,328 56,328 61,853 (5,525)
Total current728,199 728,199 707,174 21,025
Capital outlay11,954 11,954 23,894 (11,940)
Total assessing740,153 740,153 731,068 9,085
Legal and court services:
Current:
Contractual services410,000 410,000 363,838 46,162
Contingencies:
Current:
Contractual services123,014 123,014 50,733 72,281
Commodities- - 3,181 (3,181)
Total contingencies123,014 123,014 53,914 69,100
City's share of special assessment:
Current:
Contractual services28,000 28,000 24,719 3,281
Human Rights Commission:
Current:
Contractual services83,990 83,990 83,151 839
Suburban Rate Authority:
Current:
Contractual services3,000 3,000 3,000 -
Edina Resource Center
Current:
Contractual services33,372 33,372 33,372 -
Human Services Planning & Coordination
Current:
Contractual services22,736 22,736 45,756 (23,020)
Records management:
Current:
Contractual services27,000 27,000 - 27,000
Employee programs
Current:
Personal services119,200 119,200 168,062 (48,862)
Contractual services10,800 10,800 9,325 1,475
Total employee programs130,000 130,000 177,387 (47,387)
Dial-a-Ride:
Current:
Contractual services22,000 22,000 15,231 6,769
Public Artscape:
Current:
Contractual services25,000 25,000 3,736 21,264
Total general government3,752,567 3,752,567 3,601,964 150,603
63
CITY OF EDINA, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION Statement 10
BUDGETARY COMPARISON SCHEDULE - GENERAL FUND (CONTINUED)
For The Year Ended December 31, 2005
Variance with
2005Final Budget -
ActualUnder
OriginalFinalAmounts(Over)
Budgeted Amounts
Public safety:
Police protection:
Current:
Personal services5,210,487$ 5,210,487$ 5,104,617$ 105,870$
Contractual services322,635 322,635 341,309 (18,674)
Commodities69,247 69,247 65,002 4,245
Central services747,972 747,972 803,439 (55,467)
Total current6,350,341 6,350,341 6,314,367 35,974
Capital outlay243,000 243,000 547,081 (304,081)
Total police protection6,593,341 6,593,341 6,861,448 (268,107)
Fire protection:
Current:
Personal services3,068,042 3,068,042 3,012,384 55,658
Contractual services271,175 271,175 283,478 (12,303)
Commodities134,300 134,300 174,171 (39,871)
Central services274,788 274,788 286,880 (12,092)
Total current3,748,305 3,748,305 3,756,913 (8,608)
Capital outlay184,171 184,171 490,695 (306,524)
Total fire protection3,932,476 3,932,476 4,247,608 (315,132)
Civil defense:
Current:
Personal services27,733 27,733 27,729 4
Contractual services9,039 9,039 6,028 3,011
Commodities1,348 1,348 - 1,348
Total current38,120 38,120 33,757 4,363
Capital outlay5,200 5,200 - 5,200
Total civil defense43,320 43,320 33,757 9,563
Animal Control:
Current:
Personal services49,545 49,545 52,970 (3,425)
Contractual services7,929 7,929 8,961 (1,032)
Commodities3,857 3,857 238 3,619
Central services6,756 6,756 7,045 (289)
Total current68,087 68,087 69,214 (1,127)
Capital outlay6,895 6,895 - 6,895
Total animal control74,982 74,982 69,214 5,768
Public health:
Current:
Personal services236,872 236,872 214,718 22,154
Contractual services174,085 174,085 169,713 4,372
Commodities1,300 1,300 387 913
Central services26,184 26,184 28,964 (2,780)
Total current438,441 438,441 413,782 24,659
Capital outlay5,200 5,200 - 5,200
Total public health443,641 443,641 413,782 29,859
64
CITY OF EDINA, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION Statement 10
BUDGETARY COMPARISON SCHEDULE - GENERAL FUND (CONTINUED)
For The Year Ended December 31, 2005
Variance with
2005Final Budget -
ActualUnder
OriginalFinalAmounts(Over)
Budgeted Amounts
Inspections:
Current:
Personal services517,586$ 517,586$ 531,766$ (14,180)$
Contractual services84,867 84,867 110,313 (25,446)
Commodities4,296 4,296 3,945 351
Central services68,160 68,160 74,621 (6,461)
Total current674,909 674,909 720,645 (45,736)
Capital outlay17,396 17,396 2,602 14,794
Total inspections692,305 692,305 723,247 (30,942)
Total public safety11,780,065 11,780,065 12,349,056 (568,991)
Public works:
Administration:
Current:
Personal services154,481 154,481 139,194 15,287
Contractual services5,300 5,300 4,457 843
Commodities- - 309 (309)
Central services17,652 17,652 19,617 (1,965)
Total administration177,433 177,433 163,577 13,856
Engineering:
Current:
Personal services584,027 584,027 563,260 20,767
Contractual services43,050 43,050 52,568 (9,518)
Commodities13,500 13,500 13,458 42
Central services67,932 67,932 74,114 (6,182)
Total current708,509 708,509 703,400 5,109
Capital outlay46,750 46,750 83,340 (36,590)
Total engineering755,259 755,259 786,740 (31,481)
Supervision and overhead:
Current:
Personal services206,744 206,744 157,563 49,181
Contractual services35,200 35,200 33,185 2,015
Commodities600 600 587 13
Central services139,800 139,800 161,082 (21,282)
Total supervision and overhead382,344 382,344 352,417 29,927
Street maintenance:
Current:
Personal services1,634,872 1,634,872 1,668,514 (33,642)
Contractual services656,570 656,570 612,866 43,704
Commodities646,785 646,785 670,312 (23,527)
Central services512,988 512,988 512,988 -
Total current3,451,215 3,451,215 3,464,680 (13,465)
Capital outlay475,374 475,374 399,597 75,777
Total street maintenance3,926,589 3,926,589 3,864,277 62,312
Total public works5,241,625 5,241,625 5,167,011 74,614
65
CITY OF EDINA, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION Statement 10
BUDGETARY COMPARISON SCHEDULE - GENERAL FUND (CONTINUED)
For The Year Ended December 31, 2005
Variance with
2005Final Budget -
ActualUnder
OriginalFinalAmounts(Over)
Budgeted Amounts
Parks:
Administration:
Current:
Personal services549,001$ 549,001$ 537,660$ 11,341$
Contractual services30,492 30,492 25,817 4,675
Commodities3,236 3,236 2,883 353
Central services59,508 59,508 65,472 (5,964)
Total current642,237 642,237 631,832 10,405
Capital outlay6,487 6,487 3,274 3,213
Total administration648,724 648,724 635,106 13,618
Recreation:
Current:
Personal services159,203 159,203 133,497 25,706
Contractual services149,491 149,491 134,655 14,836
Commodities43,120 43,120 42,128 992
Total recreation351,814 351,814 310,280 41,534
Maintenance:
Current:
Personal services1,339,621 1,339,621 1,343,162 (3,541)
Contractual services301,249 301,249 261,999 39,250
Commodities174,195 174,195 170,224 3,971
Central services250,920 250,920 259,246 (8,326)
Total current2,065,985 2,065,985 2,034,631 31,354
Capital outlay111,206 111,206 130,875 (19,669)
Total maintenance2,177,191 2,177,191 2,165,506 11,685
Deer control:
Current:
Contractual services9,270 9,270 6,625 2,645
Commodities- - 174 (174)
Total deer control9,270 9,270 6,799 2,471
Total parks3,186,999 3,186,999 3,117,691 69,308
Total expenditures23,961,256 23,961,256 24,235,722 (274,466)
Revenues over (under) expenditures(681,500) (681,500) 1,116,913 1,798,413
Other financing sources (uses):
Transfer from other funds686,500 686,500 - (686,500)
Transfer to other funds(50,000) (50,000) (50,000) -
Sale of capital assets45,000 45,000 135,045 90,045
Total financing sources (uses)681,500 681,500 85,045 (596,455)
Net increase (decrease) in fund balance-$ -$ 1,201,958$ 1,201,958$
Fund balance - January 1 10,616,826
Fund balance - December 31 11,818,784$
66
CITY OF EDINA, MINNESOTA
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2005
67
Note A LEGAL COMPLIANCE – BUDGETS
The City follows these procedures in establishing the budgetary data reflected in the financial statements:
1. The City Manager submits to the City Council a proposed operating budget for the fiscal year
commencing the following January 1. The operating budget includes proposed expenditures and the
means of financing them.
2. Public hearings are conducted to obtain taxpayer comments.
3. The budget is legally enacted by the passage of a resolution by the City Council.
4. Formal budgetary integration is employed as a management control device during the year.
5. Budgets for the General Fund and the Community Development Block Grant Fund are adopted on a
basis consistent with generally accepted accounting principles (GAAP).
6. The City Council may authorize transfers of budgeted amounts between departments.
7. Reported budget amounts are as originally adopted or as amended by Council-approved supplemental
appropriations and budget transfers.
8. Expenditures may not legally exceed appropriations by department unless offset by increases in
revenues. All unencumbered appropriations lapse at year-end.
CITY OF EDINA, MINNESOTA
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2005
68
Note B EXCESS OF EXPENDITURES OVER APPROPRIATIONS
The General Fund budget is legally adopted on a basis consistent with accounting principles generally accepted
in the United States of America. The legal level of budgetary control is at the department level for the General
Fund. The following is a listing of General Fund departments whose expenditures exceed budget
appropriations.
FinalOver
BudgetActualBudget
General Government:
Mayor and council73,981$ 76,706$ 2,725$
Human services planning22,736 45,756 23,020
Employee programs130,000 177,387 47,387
Public Safety:
Police protection6,593,341 6,861,448 268,107
Fire protection3,932,476 4,247,608 315,132
Inspections692,305 723,247 30,942
Public Works:
Engineering755,259 786,740 31,481
Excess expenditures in the Mayor and Council department are funded by general fund balance designated for
cash flow. Excess expenditures in the human services planning, employee programs, police protection, fire
protection, and engineering departments are funded by general fund balance designated for commitments.
Excess expenditures in the inspections department are funded by greater than anticipated license and permit
revenue.
A Special Revenue Fund is used to account for the proceeds of specific revenue
sources that are legally restricted to expenditures for specified purposes.
Community Development Block Grant Fund - This fund was established to
account for funds received under Title I of the Housing and Community
Development Act of 1974.
Communications Fund - This fund was established to account for funds received
from the franchise fee of the local cable television service.
NONMAJOR GOVERNMENTAL FUNDS
Special Revenue Funds
69
CITY OF EDINA, MINNESOTA
COMBINING BALANCE SHEET Statement 11
NONMAJOR SPECIAL REVENUE FUNDS
December 31, 2005
CommunityTotal Nonmajor
DevelopmentSpecial Revenue
Block GrantCommunicationFunds
Assets
Cash and cash equivalents895$ 3,253$ 4,148$
Investments- 630,264 630,264
Accounts receivable- 128,432 128,432
Accrued interest receivable- 5,120 5,120
Due from other funds- 11,000 11,000
Due from other governments10,105 - 10,105
Total assets11,000$ 778,069$ 789,069$
Liabilities and Fund Balance
Liabilities:
Accounts payable-$ 44,006$ 44,006$
Salaries payable- 1,106 1,106
Due to other funds11,000 - 11,000
Unearned revenue- 1,930 1,930
Total liabilities11,000 47,042 58,042
Fund balance:
Unreserved:
Undesignated- 731,027 731,027
Total fund balance- 731,027 731,027
Total liabilities and fund balance11,000$ 778,069$ 789,069$
70
CITY OF EDINA, MINNESOTA
COMBINING STATEMENT OF REVENUES, EXPENDITURES Statement 12
AND CHANGES IN FUND BALANCES
NONMAJOR SPECIAL REVENUE FUNDS
For The Year Ended December 31, 2005
CommunityTotal Nonmajor
DevelopmentSpecial Revenue
Block GrantCommunicationFunds
Revenues:
Franchise fees-$ 457,421$ 457,421$
Intergovernmental172,635 - 172,635
Investment income- 15,076 15,076
Other- 54,246 54,246
Total revenues172,635 526,743 699,378
Expenditures:
Current:
General government172,635 577,174 749,809
Total expenditures172,635 577,174 749,809
Net increase (decrease) in fund balance- (50,431) (50,431)
Fund balance - January 1- 781,458 781,458
Fund balance - December 31-$ 731,027$ 731,027$
71
CITY OF EDINA, MINNESOTA
SPECIAL REVENUE FUND - COMMUNITY DEVELOPMENT BLOCK GRANT Statement 13
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
For The Year Ended December 31, 2005
Actual
OriginalFinalAmounts
Revenues:
Intergovernmental172,355$ 172,355$ 172,635$
Total revenues172,355 172,355 172,635
Expenditures:
Current:
General government172,355 172,355 172,635
Net increase (decrease) in fund balance-$ -$ -$
Fund balance - January 1 -
Fund balance - December 31 -$
Budgeted Amounts
72
Enterprise funds account for the financing of self-supporting activities of
governmental units which render services to the general public on a user charge
basis. The following are nonmajor enterprise funds:
Arena
Art Center
Edinborough Park/Centennial Lake
NONMAJOR PROPRIETARY FUNDS
Enterprise Funds
73
CITY OF EDINA, MINNESOTA
COMBINING STATEMENT OF NET ASSETS Statement 14
NONMAJOR PROPRIETARY FUNDS
December 31, 2005
Total
ArtEdinborough ParkNonmajor
ArenaCenterCentennial LakeProprietary Funds
Assets
Current assets:
Cash and cash equivalents62,284$ 9,576$ 2,032$ 73,892$
Investments- - 4,525,304 4,525,304
Interest receivable- - 36,758 36,758
Accounts receivable130,518 - 3,415 133,933
Due from other funds25,000 - - 25,000
Inventory- 15,828 - 15,828
Total current assets217,802 25,404 4,567,509 4,810,715
Noncurrent assets:
Deferred charges3,853 - - 3,853
Net capital assets3,242,321 310,863 750,791 4,303,975
Total noncurrent assets3,246,174 310,863 750,791 4,307,828
Total assets3,463,976 336,267 5,318,300 9,118,543
Liabilities:
Current liabilities:
Accounts payable59,664 25,983 42,624 128,271
Salaries payable7,894 3,378 11,973 23,245
Accrued interest payable12,392 - - 12,392
Due to other funds- - 25,000 25,000
Due to other governments663 1,358 3,682 5,703
Unearned revenue- 3,067 49,454 52,521
Compensated absences payable10,737 4,081 10,891 25,709
Bonds payable200,000 - - 200,000
Total current liabilities291,350 37,867 143,624 472,841
Noncurrent liabilities:
Compensated absences96,633 36,733 98,022 231,388
Bonds payable, net642,116 - - 642,116
Total noncurrent liabilities738,749 36,733 98,022 873,504
Total liabilities1,030,099 74,600 241,646 1,346,345
Net assets:
Invested in capital assets,
net of related debt2,404,058 310,863 750,791 3,465,712
Unrestricted29,819 (49,196) 4,325,863 4,306,486
Total net assets2,433,877$ 261,667$ 5,076,654$ 7,772,198$
74
CITY OF EDINA, MINNESOTA
COMBINING STATEMENT OF REVENUES, EXPENSES Statement 15
AND CHANGES IN FUND NET ASSETS
NONMAJOR PROPRIETARY FUNDS
For The Year Ended December 31, 2005
Total
Edinborough ParkNonmajor
ArenaArt CenterCentennial LakeProprietary Funds
Operating revenues:
Sales - retail10,999$ 60,313$ -$ 71,312$
Sales - concessions- 3,795 20,131 23,926
Memberships4,004 29,856 48,428 82,288
Admissions71,619 - 368,739 440,358
Building rental1,151,012 - 219,999 1,371,011
Rental of equipment3,759 - 54,134 57,893
Greens fees- - 180,895 180,895
Class registration & other fees135,214 397,530 491,433 1,024,177
Total operating revenues1,376,607 491,494 1,383,759 3,251,860
Operating expenses:
Cost of sales and services1,271 27,200 8,964 37,435
Personal services564,919 246,526 938,191 1,749,636
Contractual services538,475 253,188 380,634 1,172,297
Commodities50,002 46,373 171,087 267,462
Central Services39,220 31,150 82,745 153,115
Depreciation303,544 28,669 86,247 418,460
Total operating expenses1,497,431 633,106 1,667,868 3,798,405
Operating loss(120,824) (141,612) (284,109) (546,545)
Nonoperating revenues (expenses):
Investment income- - 114,144 114,144
Donations914 19,557 254 20,725
Interest and fiscal charges(24,911) - - (24,911)
Gain (loss) on sale of capital asset- - 5,983 5,983
Amortization of bond discount(2,246) - - (2,246)
Total nonoperating
revenues (expenses)(26,243) 19,557 120,381 113,695
Income (loss) before transfers(147,067) (122,055) (163,728) (432,850)
Transfers:
Transfers in86,000 100,000 - 186,000
Total transfers 86,000 100,000 - 186,000
Change in net assets(61,067) (22,055) (163,728) (246,850)
Net assets - January 1 2,494,944 283,722 5,240,382 8,019,048
Net assets - December 312,433,877$ 261,667$ 5,076,654$ 7,772,198$
75
CITY OF EDINA, MINNESOTA
COMBINING STATEMENT OF CASH FLOWS Statement 16
NONMAJOR PROPRIETARY FUNDS
For The Year Ended December 31, 2005
Total
ArtEdinborough ParkNonmajor
ArenaCenterCentennial LakeProprietary Funds
Cash flows from operating activities:
Receipts from customers and users1,373,299$ 492,011$ 1,389,475$ 3,254,785$
Payment to suppliers(598,172) (358,102) (632,646) (1,588,920)
Payment to employees(553,712) (243,885) (924,564) (1,722,161)
Net cash provided by (used in) operating activities221,415 (109,976) (167,735) (56,296)
Cash flows from noncapital financing activities:
Transfer (to) from Enterprise Funds41,000 100,000 - 141,000
Transfer (to) from Capital Project Funds45,000 - - 45,000
Net interfund borrowing(25,000) - 25,000 -
Donations914 19,557 254 20,725
Net cash provided by noncapital financing activities61,914 119,557 25,254 206,725
Cash flows from capital and related financing activities:
Acquisition of capital assets- (531) (121,462) (121,993)
Sale of capital assets- - 5,983 5,983
Principal paid on bonds(195,000) - - (195,000)
Interest paid on bonds(26,815) - - (26,815)
Net cash used in capital and related financing activities(221,815) (531) (115,479) (337,825)
Cash flows from investing activities:
Proceeds from sales of investments- - 133,086 133,086
Investment income- - 116,915 116,915
Net cash flows provided by (used in) investing activities- - 250,001 250,001
Net increase (decrease) in cash
and cash equivalents61,514 9,050 (7,959) 62,605
Cash and cash equivalents - January 1770 526 9,991 11,287
Cash and cash equivalents - December 3162,284$ 9,576$ 2,032$ 73,892$
Reconciliation of operating loss to net cash
provided (used) by operating activities:
Operating loss (120,824)$ (141,612)$ (284,109)$ (546,545)$
Adjustments to reconcile operating loss
to net cash flows from operating activities:
Depreciation303,544 28,669 86,247 418,460
Changes in assets and liabilities:
Decrease (increase) in receivables(3,308) - 5,512 2,204
Decrease (increase) in inventory- 1,140 - 1,140
Increase (decrease) in accounts payable30,341 4,268 11,672 46,281
Increase (decrease) in salaries payable2,020 1,181 2,724 5,925
Increase (decrease) in contracts payable- (5,732) - (5,732)
Increase (decrease) in due to other governments455 133 (888) (300)
Increase (decrease) in unearned revenue- 517 204 721
Increase (decrease) in compensated absences9,187 1,460 10,903 21,550
Total adjustments342,239 31,636 116,374 490,249
Net cash provided by (used in)
operating activities221,415$ (109,976)$ (167,735)$ (56,296)$
Noncash investing, capital and financing activities:
Increase (decrease) in fair value of investments -$ -$ (68,856)$ (68,856)$
76
CITY OF EDINA, MINNESOTA
COMBINING STATEMENT OF CHANGES IN Statement 17
ASSETS AND LIABILITIES
AGENCY FUNDS
For The Year Ended December 31, 2005
BalanceBalance
January 1AdditionsDeductionsDecember 31
POLICE SEIZURE
ASSETS:
Cash 251,648$ 49,025$ -$ 300,673$
LIABILITIES:
Due to other governmental units 251,648$ 49,025$ -$ 300,673$
PUBLIC SAFETY TRAINING FACILITY
ASSETS:
Cash11,138$ -$ 2,055$ 9,083$
Due from other governmental units172,006 - 172,006 -
Investments 40,000 95,000 - 135,000
TOTAL ASSETS 223,144$ 95,000$ 174,061$ 144,083$
LIABILITIES:
Accounts payable17,993$ -$ 7,027$ 10,966$
Salaries payable817 134 - 951
Contracts payable33,945 - 33,945 -
Due to other governmental units 170,389 - 38,223 132,166
TOTAL LIABILITIES 223,144$ 134$ 79,195$ 144,083$
PAYROLL
ASSETS:
Cash -$ 229,971$ -$ 229,971$
LIABILITIES:
Accounts payable-$ 70,677$ -$ 70,677$
Due to other governmental units - 159,294 - 159,294
TOTAL LIABILITIES -$ 229,971$ -$ 229,971$
TOTALS - ALL AGENCY FUNDS
ASSETS:
Cash262,786$ 278,996$ 2,055$ 539,727$
Investments40,000 95,000 - 135,000
Due from other governmental units 172,006 - 172,006 -
TOTAL ASSETS 474,792$ 373,996$ 174,061$ 674,727$
LIABILITIES:
Accounts payable17,993$ 70,677$ 7,027$ 81,643$
Salaries payable817 134 - 951
Contracts payable33,945 - 33,945 -
Due to other governmental units 422,037 208,319 38,223 592,133
TOTAL LIABILITIES 474,792$ 279,130$ 79,195$ 674,727$
77
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79
CITY OF EDINA, MINNESOTA
COMBINED SCHEDULE OF BONDED INDEBTEDNESS
December 31, 2005
Final
InterestMaturityOriginal
RatesDateDateIssueRedeemed
Tax Increment Bonds:
Tax Increment Taxable Refunding Bonds, Series 1996A5.85 - 6.2503/01/9602/01/0911,250,000$ 4,175,000$
Tax Increment Bonds, Series 1997B4.50 - 5.2004/01/9702/01/135,090,000 975,000
Tax Increment Bonds, Series 2000A4.30 - 4.8009/06/0002/01/112,620,000 660,000
Tax Increment Bonds, Series 2000C4.50 - 4.6509/06/0002/01/0915,820,000 3,855,000
Tax Increment Bonds, Series 2002B3.00%08/05/0202/01/091,400,000 -
Tax Increment Taxable Refunding Bonds, Series 2003B1.128 - 1.74903/01/0302/01/066,570,000 2,325,000
Tax Increment Refunding Bonds, Series 2005B3.00%07/19/0502/01/09- -
Tax Increment Taxable Refunding Bonds, Series 2005C3.75 - 4.2507/19/0502/01/09- -
Tax Increment Refunding Bonds, Series 2005D3.00 - 3.4007/19/0502/01/13- -
Total Tax Increment Bonds42,750,000 11,990,000
General Obligation Bonds:
GO Park & Recreation, Series 1996B4.25 - 5.7508/01/9602/01/178,090,000 1,790,000
GO Equipment Certificates, Series 2003A1.05 - 2.4003/01/0302/01/081,540,000 545,000
GO Park & Recreation Refunding Bonds, Series 2005A3.50 - 4.0007/19/0502/01/17- -
GO Permanent Improvement Revolving, Series 2005E3.00 - 3.7509/13/0502/01/16- -
Total General Obligation Bonds9,630,000 2,335,000
Public Project Revenue Bonds:
Public Project Revenue, Series 20024.00 - 5.2501/01/0202/01/2112,410,000 815,000
Public Project Revenue, Series 20053.00 - 4.1309/13/0505/01/26- -
Total Public Project Revenue Bonds12,410,000 815,000
Revenue Bonds:
Recreational Facility Bonds, Series 1999B3.70 - 4.4505/03/9901/01/133,270,000 475,000
Recreational Facility Bonds, Series 2001A2.25 - 4.6511/01/0101/01/174,620,000 1,090,000
Utility Revenue Bonds, Series 1999A3.20 - 4.2005/03/9902/01/093,600,000 1,650,000
Utility Revenue Bonds, Series 2003C1.10 - 3.5503/01/0302/01/133,200,000 290,000
Total Public Project Revenue Bonds14,690,000 3,505,000
Total - Bonded indebtedness79,480,000$ 18,645,000$
Prior Years
80
Exhibit 1
PrincipalInterestInterest
OutstandingPayableDueDuePayable
12/31/2004IssuedPayments12/31/2005In 2006In 2006to Maturity
7,075,000$ -$ 7,075,000$ -$ -$ -$ -$
4,115,000 - 250,000 3,865,000 3,865,000 102,453 102,453
1,960,000 - 240,000 1,720,000 255,000 74,095 253,529
11,965,000 - 11,965,000 - - - -
1,400,000 - - 1,400,000 - 42,000 273,000
4,245,000 - 2,570,000 1,675,000 1,675,000 20,938 20,938
- 10,520,000 - 10,520,000 1,650,000 301,370 721,070
- 6,220,000 - 6,220,000 1,000,000 245,318 591,705
- 3,505,000 - 3,505,000 - 116,433 533,422
30,760,000 20,245,000 22,100,000 28,905,000 8,445,000 902,607 2,496,117
6,300,000 - 350,000 5,950,000 5,950,000 164,581 164,581
995,000 - 555,000 440,000 145,000 7,950 14,800
- 5,375,000 - 5,375,000 - 205,776 1,407,632
- 1,460,000 - 1,460,000 - 43,366 290,976
7,295,000 6,835,000 905,000 13,225,000 6,095,000 421,673 1,877,989
11,595,000 - 460,000 11,135,000 480,000 537,337 5,071,894
- 5,425,000 - 5,425,000 - 242,441 2,724,195
11,595,000 5,425,000 460,000 16,560,000 480,000 779,778 7,796,089
2,795,000 - 265,000 2,530,000 270,000 102,925 464,144
3,530,000 - 585,000 2,945,000 610,000 96,335 381,410
1,950,000 - 360,000 1,590,000 375,000 57,345 134,152
2,910,000 - 285,000 2,625,000 290,000 72,263 349,679
11,185,000 - 1,495,000 9,690,000 1,545,000 328,868 1,329,385
60,835,000$ 32,505,000$ 24,960,000$ 68,380,000$ 16,565,000$ 2,432,926$ 13,499,580$
2005
81
CITY OF EDINA, MINNESOTA
ASSESSED VALUATION, TAX LEVIES AND MILL RATES Exhibit 2
(shown by year of tax collectibility)
20022003200420052006
Total tax capacity72,583,694$ 77,665,879$ 83,447,880$ 91,309,672$ 101,947,912$
Increment valuation(6,513,676) (6,909,331) (6,949,064) (7,330,826) (7,980,069)
Contribution to fiscal disparities pool(6,893,865) (7,587,409) (7,945,664) (7,635,854) (7,107,862)
Tax capacity used for rate calculation59,176,153 63,169,139 68,553,152 76,342,992 86,859,981
Fiscal disparities distribution1,830,348 1,975,365 2,202,656 2,374,371 2,411,937
Adjusted net tax capacity61,006,501$ 65,144,504$70,755,808$78,717,363$ 89,271,918$
Tax levies:
General fund15,990,256$ 16,171,875$ 16,489,129$ 17,772,350$ 18,560,151$
Public project revenue1,000,000 1,026,437 1,028,837 1,058,840 1,501,741
Certificates of indebtedness- 586,163 604,275 162,200 159,100
Total certified tax levies16,990,256 17,784,475 18,122,241 18,993,390 20,220,992
Referendum market value levy738,347 721,967 686,662 674,161 599,138
Total levy17,728,603$ 18,506,442$18,808,903$19,667,551$ 20,820,130$
Tax capacity rate:
General fund revenue26.11624.58623.18322.53620.755
Bonds & interest1.6902.5532.3821.5491.858
Total tax capacity rate27.80627.13925.56524.08522.613
Market value rate0.0120.0110.0100.008800.00703
82
CITY OF EDINA, MINNESOTA
SCHEDULE OF SOURCES AND USES OF PUBLIC FUNDS Exhibit 3
FOR 50TH & FRANCE-NO. 1200, A TAX INCREMENT FINANCING DISTRICT
(Districts 1200, 1201, 1203 and 1204 are pooled)
December 31, 2005
(Unaudited)
Accounted
OriginalAmendedfor inCurrentAmount
BudgetBudgetprior yearsyearremaining
Source of funds:
Bond proceeds2,200,000$ 5,280,000$ 5,251,998$ -$ 28,002$
Tax increments received- 31,748,489 21,729,744 861,400 9,157,345
Real estate sales *800,000 170,782 170,782 - -
State aid- 418,871 418,871 - -
Special assessments- 1,321,096 728,505 - 592,591
Parking permits- 268,524 268,524 - -
Community development- 186,064 186,064 - -
Interest on invested funds- 2,000,000 2,689,340 41,430 (730,770)
Other- 73,881 73,881 - -
Total sources of funds:3,000,000 41,467,707 31,517,709 902,830 9,047,168
Uses of funds:
Land acquisition- 873,061 873,061 - -
Installation of public utilities
and improvements3,000,000 7,867,034 7,862,032 - 5,002
Bond payments:
Principal- 5,280,000 4,500,000 860,000 (80,000)
Interest- 4,738,329 4,132,264 8,600 597,465
Administrative costs- 1,230,000 1,206,201 (750) 24,549
Paid to other governments- 21,000 14,009 1,633 5,358
Work orders- 16,257 16,257 - -
Contingencies- 11,644 11,644 - -
Interest- 463,037 463,037 - -
Miscellaneous- 62,095 63,010 - (915)
Transfer- 15,000,000 10,000,000 2,350,000 2,650,000
Total uses of funds:3,000,000 35,562,457 29,141,515 3,219,483 3,201,459
Funds remaining (deficit)-$ 5,905,250$ 2,376,194$ (2,316,653)$ 5,845,709$
Cost to authorityPrice paid by developer
* Real estate sales
Liquor store site128,064$ 105,002$
Union oil site134,506 65,780
262,570$ 170,782$
83
CITY OF EDINA, MINNESOTA
SCHEDULE OF SOURCES AND USES OF PUBLIC FUNDS Exhibit 4
FOR SOUTHEAST EDINA REDEVELOPMENT DISTRICT-NO. 1201, A TAX INCREMENT FINANCING DISTRICT
(Districts 1200, 1201, 1203 and 1204 are pooled)
December 31, 2005
(Unaudited)
Accounted
OriginalAmendedfor inCurrentAmount
BudgetBudgetprior yearsyearremaining
Source of funds:
Bond proceeds6,165,177$ 21,470,000$ 20,219,852$ -$ 1,250,148$
Tax increments received- 75,000,000 49,550,750 2,694,507 22,754,743
Real estate sales *598,005 3,000,000 2,642,115 - 357,885
Loan proceeds- 1,321,096 - - 1,321,096
Community development- 189,221 189,221 - -
Interest on invested funds- 3,500,000 2,652,263 7,885 839,852
Other- 50,000 1,357 - 48,643
Total sources of funds:6,763,182 104,530,317 75,255,558 2,702,392 26,572,367
Uses of funds:
Land acquisition6,682,998 12,200,000 6,894,303 - 5,305,697
Installation of public utilities
and improvements- 16,000,000 14,278,823 - 1,721,177
Site improvements or
preparation costs2,885,484 2,000,000 468,098 - 1,531,902
Bond payments:
Principal- 21,470,000 19,060,000 1,710,000 700,000
Interest- 20,100,000 19,692,351 58,975 348,674
Administrative costs194,700 1,800,000 1,673,988 - 126,012
Paid to other governments- 110,000 66,532 9,012 34,456
Transfers out- 17,000,000 11,447,957 1,048,742 4,503,301
Interest reduction- 1,850,000 - - 1,850,000
Parkland dedication fees- 767,852 767,852 - -
Total uses of funds:9,763,182 93,297,852 74,349,904 2,826,729 16,121,219
Funds remaining (deficit)(3,000,000)$ 11,232,465$ 905,654$ (124,337)$ 10,451,148$
Cost to authorityPrice paid by developer
* Real estate sales
Retail site8,350$ 11,899$
Hotel site192,915 192,915
Elderly site453,740 346,534
Office site1,027,277 784,563
Coventry Townhouses1,318,103 1,318,103
3,000,385$ 2,654,014$
84
CITY OF EDINA, MINNESOTA
SCHEDULE OF SOURCES AND USES OF PUBLIC FUNDS Exhibit 5
FOR GRANDVIEW AREA REDEVELOPMENT DISTRICT-NO. 1202, A TAX INCREMENT FINANCING DISTRICT
December 31, 2005
(Unaudited)
Accounted
OriginalAmendedfor inCurrentAmount
BudgetBudgetprior yearsyearremaining
Source of funds:
Bond proceeds4,500,000$ 9,900,000$ 9,475,915$ -$ 424,085$
Tax increments received- 29,737,107 10,800,539 1,006,044 17,930,524
Real estate sales *- 4,700,000 5,402,344 - (702,344)
Interest on invested funds- 300,000 872,763 28,731 (601,494)
Other- - 59,868 1,200 (61,068)
Total sources of funds:4,500,000 44,637,107 26,611,429 1,035,975 16,989,703
Uses of funds:
Land acquisition- 6,500,000 3,682,581 66,918 2,750,501
Installation of public utilities
and improvements4,310,000 17,127,000 9,738,935 - 7,388,065
Bond payments:
Principal- 9,900,000 6,277,555 240,000 3,382,445
Interest- 9,190,000 2,691,204 127,173 6,371,623
Loan/note interest- - 1,792,067 574,939 (2,367,006)
Paid to other governments- - 191,998 1,550 (193,548)
Administrative costs190,000 1,920,107 1,304,012 14,687 601,408
Total uses of funds:4,500,000 44,637,107 25,678,352 1,025,267 17,933,488
Funds remaining (deficit)-$ -$ 933,077$ 10,708$ (943,785)$
Cost to authorityPrice paid by developer
* Real estate sales
5229 Eden Ave.1,822,319$
5220 Eden Circle995,000
5244 Eden Circle (condemnation deposit)309,937
5201 Eden Circle598,411 2,070,119
Project area23,832 4,005,694
3,749,499$ 6,075,813$
85
CITY OF EDINA, MINNESOTA
SCHEDULE OF SOURCES AND USES OF PUBLIC FUNDS Exhibit 6
FOR SOUTHEAST EDINA REDEVELOPMENT DISTRICT-NO. 1203, A TAX INCREMENT FINANCING DISTRICT
(Districts 1200, 1201, 1203 and 1204 are pooled)
December 31, 2005
(Unaudited)
Accounted
OriginalAmendedfor inCurrentAmount
BudgetBudgetprior yearsyearremaining
Source of funds:
Bond proceeds41,400,000$ 41,400,000$ 33,761,677$ -$ 7,638,323$
Tax increments received80,000,000 90,000,000 26,664,213 2,498,793 60,836,994
Real estate sales *5,000,000 11,637,070 11,637,070 - -
Special assessment- 1,321,096 - - 1,321,096
Interest on invested funds- 2,500,000 2,589,166 200,573 (289,739)
Transfer in- 32,000,000 22,559,181 3,398,743 6,042,076
Sale of material- 255,710 255,710 - -
Developer payments- 297,826 297,826 - -
Other- 20,000 21,799 - (1,799)
Total sources of funds:126,400,000 179,431,702 97,786,642 6,098,109 75,546,951
Uses of funds:
Land acquisition13,900,000 22,981,425 22,981,425 - -
Installation of public utilities
and improvements26,677,000 25,871,230 16,594,753 - 9,276,477
Bond payments:
Principal41,400,000 41,400,000 12,589,724 2,655,000 26,155,276
Interest38,000,000 38,000,000 31,275,365 1,133,235 5,591,400
Administrative costs1,140,800 1,600,000 1,275,223 13,292 311,485
Paid to other governments- 42,000 23,751 3,113 15,136
Loan/note interest- 14,684,711 3,057,661 455,184 11,171,866
Parkland dedication fees- 2,030,345 2,030,345 - -
Total uses of funds:121,117,800 146,609,711 89,828,247 4,259,824 52,521,640
Funds remaining (deficit)5,282,200$ 32,821,991$ 7,958,395$ 1,838,285$ 23,025,311$
Cost to authorityPrice paid by developer
* Real estate sales
Retail and theater site3,213,720$ 3,213,720$
Medical office site815,092 815,092
Office site1,107,160 1,107,160
Office building #1449,300 449,300
Office building #21,280,702 1,280,702
Office building #31,341,533 1,341,533
Office building #41,625,849 1,625,849
Office building #51,803,714 1,803,714
11,637,070$ 11,637,070$
86
CITY OF EDINA, MINNESOTA
SCHEDULE OF SOURCES AND USES OF PUBLIC FUNDS Exhibit 7
FOR 70TH STREET AND CAHILL ROAD DISTRICT-NO. 1207, A TAX INCREMENT FINANCING DISTRICT
December 31, 2005
(Unaudited)
Accounted
OriginalAmendedfor inCurrentAmount
BudgetBudgetprior yearsyearremaining
Source of funds:
Bond proceeds1,911,000$ 1,911,000$ -$ -$ 1,911,000$
Tax increments received2,177,855 2,177,855 746,863 - 1,430,992
Interest on invested funds- - 186,947 11,385 (198,332)
Other- - - - -
Total sources of funds:4,088,855 4,088,855 933,810 11,385 3,143,660
Uses of funds:
Land acquisition529,400 529,400 33,237 - 496,163
Installation of public utilities
and improvements325,000 325,000 540,279 - (215,279)
Demolition150,000 150,000 - - 150,000
Relocation160,000 160,000 - - 160,000
Capitalized interest150,000 150,000 - - 150,000
Debt service2,178,455 2,178,455 - - 2,178,455
Paid to other governments- - 2,730 - (2,730)
Administrative costs596,000 596,000 74,830 - 521,170
Total uses of funds:4,088,855 4,088,855 651,076 - 3,437,779
Funds remaining (deficit)-$ -$ 282,734$ 11,385$ (294,119)$
87
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89
CITY OF EDINA, MINNESOTA
GOVERNMENT-WIDE EXPENSES BY FUNCTION
Last Three Fiscal Years
(Unaudited)
Interest on
FiscalGeneralPublicPublicLong-Term
Year*GovernmentSafetyWorksParksDebt
20035,839,893$ 10,784,215$ 5,621,291$ 4,484,685$ 2,760,022$
20046,934,045 11,063,767 5,834,490 4,248,060 2,399,682
20054,967,008 12,019,027 7,185,784 5,901,648 2,288,524
*Government-wide expenses are not available for years prior to 2003
90
Table 1
Community
AquaticGolfActivity
UtilityLiquorCenterCourseCentersTotal
8,107,553$ 8,764,081$ 711,061$ 3,555,243$ 3,833,026$ 54,461,070$
7,801,580 9,110,888 701,768 3,508,741 3,850,192 55,453,213
8,254,409 9,749,313 725,936 3,580,307 3,825,562 58,497,518
91
CITY OF EDINA, MINNESOTA
GOVERNMENT-WIDE REVENUES Table 2
Last Three Fiscal Years
(Unaudited)
ChargesOperatingCapitalUnrestricted
FiscalForGrants andGrants andPropertyTaxFranchiseInvestment
Year*ServicesContributionsContributionsTaxesIncrementsTaxesEarningsTotal
200332,908,375$ 1,347,776$ 7,214,393$ 17,815,426$ 7,342,270$ -$ 673,326$ 67,301,566$
200433,299,158 1,293,255 4,192,947 17,865,757 6,761,934 450,956 670,241 64,534,248
200535,441,433 1,643,774 2,252,491 19,071,202 7,060,744 457,421 1,214,610 67,141,675
*Government-wide revenues are not available for years prior to 2003
General RevenuesProgram Revenues
92
CITY OF EDINA, MINNESOTA
PROPERTY TAX LEVIES AND COLLECTIONS Table 3
Last Ten Fiscal Years
(Unaudited)
TotalDelinquent
TotalCurrentPercentDelinquentCollectionsOutstandingTaxes as
TaxesTaxTaxof LevyTax Total Taxas Percent ofDelinquentPercent of
PayableLevy (1)CollectionCollected (2)CollectionsCollectionsCurrent LevyTaxesCurrent Levy
199612,178,440$ 12,026,177$ 98.75%(262,279)$ 11,763,898$ 96.60%36,198$ 0.30%
199712,531,244 12,381,729 98.81%(244,913) 12,136,816 96.85%39,107 0.31%
199813,099,140 13,003,882 99.27%48,985 13,052,867 99.65%54,226 0.41%
199913,284,962 13,147,288 98.96%36,293 13,183,581 99.24%99,202 0.75%
200013,650,158 13,554,044 99.30%15,355 13,569,399 99.41%116,362 0.85%
200114,438,346 14,331,078 99.26%25,907 14,356,985 99.44%121,548 0.84%
200216,990,256 16,874,198 99.32%55,578 16,929,776 99.64%132,443 0.78%
200317,784,475 17,088,979 96.09%68,657 17,157,636 96.48%80,841 0.45%
200418,122,241 17,386,812 95.94%(202,429) 17,184,383 94.82%154,878 0.85%
200518,993,390 18,419,995 96.98%(32,264) 18,387,731 96.81%169,275 0.89%
(1) Excludes market value referendum levy.
(2) Beginning in 2003, the State of Minnesota ended reimbursement for the homestead market value credit (HMVC) program.
The HMVC program reduces property taxes for certain residential properties and is phased out once a property reaches a
certain assessed value. When the State ended reimbursing the City for HMVC in 2003, tax collections as a percent of levy
dropped, as shown in this table. Due to the phase out provision in the HMVC program, the City anticipates that the impact
of this lost revenue will decrease over time as property values rise above the phase out level.
Source: Hennepin County Taxpayer Services
93
CITY OF EDINA, MINNESOTA
ASSESSED VALUE OR TAX CAPACITY AND ESTIMATED MARKET VALUE OF TAXABLE PROPERTY
Last Ten Fiscal Years Table 4
(Unaudited)
Ratio of Total
Tax Capacity to
AssessmentEstimatedTotal Estimated
YearTax CapacityMarket ValueMarket Value
199685,775,887$ 4,071,654,134$ 2.11%
199791,586,990 4,074,713,634 2.25%
199887,726,810 4,267,758,501 2.06%
199985,963,836 4,535,761,900 1.90%
200090,055,752 4,861,730,000 1.85%
200172,133,594 5,821,566,500 1.24%
200277,665,879 6,328,581,300 1.23%
200383,089,465 6,909,476,700 1.20%
200490,934,037 8,033,679,900 1.13%
2005101,559,484 8,693,345,900 1.17%
Source: Hennepin County Taxpayer Services
Real Property
94
CITY OF EDINA, MINNESOTA
PROPERTY TAX RATES - Table 5
ALL OVERLAPPING GOVERNMENTS
Last Ten Fiscal Years
(Unaudited)
Tax Rates
(Per $1,000 of Assessed Valuation)
Payable
YearCitySchoolCountyOtherTotal
199616.33162.26837.2707.494123.363
199715.62657.21335.5156.659115.013
199816.81347.49938.3887.538110.238
199917.81050.76640.9948.553118.123
200017.66951.67839.6558.426117.428
200117.23346.83937.6248.126109.822
200227.80618.50450.4099.847106.566
200327.13923.31250.6078.993110.051
200425.56522.67047.3248.256103.815
200524.08519.69444.1728.72196.672
Source: Hennepin County Taxpayer Services
95
CITY OF EDINA, MINNESOTA
SPECIAL ASSESSMENT COLLECTIONS Table 6
Last Ten Fiscal Years
(Unaudited)
Percent
CollectionPercentof TotalTotal
Totalof Currentof LevyDelinquentTotalCollections toOutstanding
YearLevyYear's LevyCollectedCollectionsCollectionsTotal LevyAssessments
1996768,800$ 764,997$ 99.51%16,636$ 781,633$ 101.67%13,389$
1997590,048 576,513 97.71%9,036 585,549 99.24%17,889
1998654,442 635,476 97.10%3,798 639,274 97.68%33,057
1999773,251 753,251 97.41%14,273 767,524 99.26%38,784
2000960,562 930,484 96.87%5,586 936,070 97.45%63,275
20011,003,856 975,921 97.22%51,173 1,027,094 102.31%40,038
2002974,141 950,417 97.56%23,756 974,173 100.00%40,006
2003978,278 964,440 98.59%24,439 988,879 101.08%29,404
2004900,817 894,713 99.32%13,019 907,732 100.77%34,427
20051,061,234 1,035,470 97.57%24,995 1,060,465 99.93%35,199
96
CITY OF EDINA, MINNESOTA
RATIO OF NET BONDED DEBT Table 7
TO ASSESSED VALUE AND NET BONDED DEBT PER CAPITA
Last Ten Fiscal Years
(Unaudited)
DebtRatio of
GrossServiceNet BondedNet Bonded
FiscalNet TaxBondedMoniesNet BondedDebt toDebt
YearPopulation (1)CapacityDebt (2)AvailableDebtTax CapacityPer Capita
199646,845 80,087,160$ 92,680,000$ 25,429,215$ 67,250,785$ 83.97%1,436$
199747,029 77,762,151 94,385,000 17,929,523 76,455,477 98.32%1,626
199847,113 85,259,000 70,260,000 589,371 69,670,629 81.72%1,479
199947,235 77,165,969 73,005,000 4,384,419 68,620,581 88.93%1,453
200047,425 83,715,952 88,175,000 21,251,947 66,923,053 79.94%1,411
200147,465 61,006,501 72,465,000 8,321,645 64,143,355 105.14%1,351
200247,465 65,486,283 70,735,000 3,070,758 67,664,242 103.33%1,426
200347,570 70,755,808 68,740,000 4,053,306 64,686,694 91.42%1,360
200448,156 90,934,037 60,835,000 3,102,028 57,732,972 63.49%1,199
200548,050 101,559,484 68,380,000 10,808,902 57,571,098 56.69%1,198
(1) Population estimates provided from Metropolitan Council which reflect the federal census.
(2) Includes all long-term bonded general obligation and revenue debt.
97
CITY OF EDINA, MINNESOTA
COMPUTATION OF DIRECT AND OVERLAPPING DEBT Table 8
INCLUDING DEBT RATIOS
December 31, 2005
(Unaudited)
Net GeneralPercentage
Obligation BondedApplicableCity Share
Overlapping Debt:Debt Outstanding (1)In Cityof Debt
Hennepin County370,442,913$ 7.07%26,190,314$
Hennepin Suburban Park District45,571,202 9.31%4,242,679
Hennepin Regional Rail Authority46,547,489 7.07%3,290,907
School Districts:
ISD No. 273 (Edina)117,042,947 98.39%115,158,556
ISD No. 270 (Hopkins)83,884,254 8.75%7,339,872
ISD No. 271 (Bloomington)123,154,593 0.01%12,315
ISD No. 272 (Eden Prairie)130,035,000 0.95%1,235,333
ISD No. 280 (Richfield)20,790,915 17.37%3,611,382
ISD No. 283 (St. Louis Park)86,139,752 0.02%17,228
Metro Council206,623,754 3.18%6,570,635
Total Overlapping Debt1,230,232,819 167,669,221
Direct Debt:
City of Edina29,963,863 100.00%29,963,863
Total Overlapping and Direct Debt1,260,196,682$ 197,633,084$
Debt Ratios:
Ratio of debt per capita (48,050 population)4,113$
Ratio of debt to estimated market valuation of $8,693,345,9002.27%
(1) Calculation excludes revenue and special assessment bonds as well as sinking fund balance, if any.
Source: Hennepin County Taxpayer Services
98
CITY OF EDINA, MINNESOTA
RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR Table 9
GENERAL BONDED DEBT TO TOTAL GENERAL EXPENDITURES
Last Ten Fiscal Years
(Unaudited)
Percent of
Debt Service
InterestTotalTotalExpenditures
FiscalandDebtGeneralTo General
YearPrincipalOtherServiceExpendituresExpenditures
19961,400,000$ 4,881,475$ 6,281,475$ 23,128,537$ 27.16%
19972,120,000 4,502,948 6,622,948 24,000,082 27.60%
19982,224,724 4,099,809 6,324,533 25,390,000 24.91%
19993,275,000 3,262,266 6,537,266 25,131,088 26.01%
20006,050,000 3,108,601 9,158,601 25,814,880 35.48%
20013,740,000 3,148,719 6,888,719 28,382,482 24.27%
20025,885,000 3,094,480 8,979,480 30,675,141 29.27%
20035,700,000 2,883,377 8,583,377 30,539,932 28.11%
20046,450,000 2,478,587 8,928,587 32,799,091 27.22%
20056,830,000 2,543,639 9,373,639 34,359,170 27.28%
Note: This table includes General, Special Revenue and Debt Service Funds.
99
CITY OF EDINA, MINNESOTA
REVENUE BOND COVERAGE Table 10
Last Ten Fiscal Years
(Unaudited)
Net
revenue
GrossDirectavailable
Fiscaloperatingoperatingfor debt
Yearrevenueexpenses (1)servicePrincipalInterestTotalCoverage
Utility Bond
19967,753,016 7,007,293 745,723 370,000 52,019 422,019 177
19978,110,744 7,526,033 584,711 390,000 40,744 430,744 136
19988,108,612 7,226,648 881,964 400,000 22,184 422,184 209
19998,502,423 6,713,673 1,788,750 420,000 83,429 503,429 355
20008,793,386 7,205,934 1,587,452 335,000 127,525 462,525 343
20018,556,810 7,065,589 1,491,221 310,000 116,794 426,794 349
20028,561,287 7,399,773 1,161,514 325,000 105,205 430,205 270
20039,668,434 7,769,810 1,898,624 335,000 160,691 495,691 383
20049,473,355 7,643,129 1,830,226 635,000 158,451 793,451 231
200510,225,975 8,107,039 2,118,936 645,000 141,226 786,226 270
Recreational Facility Bonds
19964,311,141 3,545,291 765,850 250,000 774,800 1,024,800 75
19974,440,202 3,945,975 494,227 295,000 762,411 1,057,411 47
19985,042,394 4,270,042 772,352 4,240,000 372,390 4,612,390 17
19995,141,606 4,332,932 808,674 430,000 522,050 952,050 85
20005,727,930 5,209,610 518,320 450,000 553,962 1,003,962 52
20015,430,507 5,231,143 199,364 470,000 531,176 1,001,176 20
20025,424,422 5,031,839 392,583 6,780,000 611,509 7,391,509 5
20035,866,300 5,511,730 354,570 745,000 265,602 1,010,602 35
20045,621,743 5,492,510 129,233 820,000 241,387 1,061,387 12
20055,708,827 5,604,464 104,363 850,000 214,108 1,064,108 10
(1) Before interest costs.
Debt service requirements
100
CITY OF EDINA, MINNESOTA
PROPERTY AND CONSTRUCTION VALUES Table 11
Last Ten Fiscal Years
(Unaudited)
Number of Number of Commercial/Residential/
YearPermitsValuePermitsValueIndustrialApartments
199627935,789,432$ 1,31831,334,870$ 745,200,700$ 3,326,107,834$
199740737,074,290 1,78032,387,315 824,767,100 3,438,309,200
199846238,495,806 1,83035,625,118 904,869,800 3,623,187,200
199932336,708,942 3,47827,637,742 980,837,900 3,924,031,400
20001,41866,980,499 4,01348,278,737 1,069,928,100 4,387,874,100
200183486,608,740 4,97365,574,279 1,173,397,300 5,056,797,500
200275744,300,120 4,84169,612,658 1,217,214,600 5,834,821,900
200381250,696,987 4,82785,287,525 1,202,162,900 6,286,945,800
200487646,251,604 4,94383,315,920 1,176,787,600 6,856,892,300
2005857131,497,513 5,080100,027,692 1,298,757,600 7,396,894,700
* Assessor's estimated market value
Source: City of Edina Building Inspections Office
Property value *construction
CommercialResidential
construction
101
CITY OF EDINA, MINNESOTA
PRINCIPAL TAXPAYERS Table 12
2005
(Unaudited)
2005
Net
TaxpayerType of BusinessTax Capacity
SouthdaleShopping center3,483,870$
GalleriaShopping center1,525,904
Southdale Office parkOffice building717,250
Centennial lakes Phase VOffice building543,824
Centennial Lakes Phase IVOffice building533,268
7700 FranceOffice building463,742
Southdale Medical BuildingOffice building343,884
May Department StoresRetail343,044
Centennial Lakes Phase IIIOffice building333,360
Centennial Lakes Phase IIOffice building322,194
Source: City of Edina Assessing Office
102
CITY OF EDINA, MINNESOTA
MAJOR EMPLOYERS IN THE CITY Table 13
2005
(Unaudited)
Approximate
Number
EmployerProduct/Serviceof Employees
Jerry's Enterprises Inc.Grocery Stores4,500
Fairview Southdale HospitalGeneral Medical & Surgical Hospitals2,500
Marshall FieldsDepartment Stores1,200
Edina Public School ISD#273Elementary & Secondary Schools1,172
Nash Finch Co.Grocery Stores350
International Dairy Queen Inc.Full-Service Restaurants300
City of EdinaLocal Government262
J.C. PenneyDepartment Stores250
Edina RealtyReal Estate210
Con Agra FoodsSnack Food Mfg196
Source: City of Edina "Community Profile", Minnesota Department of Trade and Economic Development, 2005
103
CITY OF EDINA, MINNESOTA
DEMOGRAPHIC STATISTICS Table 14
Last Ten Fiscal Years
(Unaudited)
PersonalPer CapitaHigh School
Income (2)PersonalMedianGraduationUnemployment
Population (1)(In thousands)Income (3)Age (4)Rate (4)Rate (5)
46,8451,363,049$ 29,097$ 32.788.2%1.80%
47,0291,446,612 30,760 32.788.2%1.60%
47,1131,556,896 33,046 32.788.2%1.50%
47,2351,628,002 34,466 32.788.2%1.60%
47,4251,747,042 36,838 32.788.2%2.40%
47,4651,774,194 37,379 34.991.5%3.30%
47,4651,796,693 37,853 34.991.5%4.00%
47,5701,847,429 38,836 34.991.5%4.10%
48,1561,970,303 40,915 36.293.1%3.90%
48,050N/AN/A36.293.1%3.30%
N/A - Data not available
Data Sources
(1) U.S. Census Bureau/Metropolitan Council.
(2) Estimates based on U.S. Department of Commerce Bureau of Economic Analysis data for the entire
seven-county metropolitan area.
(3) U.S. Department of Commerce Bureau of Economic Analysis. Per capita income is for the entire
seven-county metropolitan area.
(4) U.S. Census Bureau. Data is for Hennepin County.
(5) State of Minnesota Department of Employment and Economic Development.
2001
2000
1999
1998
2005
2004
2003
2002
1997
1996
Fiscal
Year
104
CITY OF EDINA, MINNESOTA
MISCELLANEOUS STATISTICAL DATA Table 15
December 31, 2005
(Unaudited)
Date of incorporationDecember 17, 1888
Form of governmentPlan B
Date of adoption of Council-Manager PlanJanuary 1, 1955
Fiscal year beginsJanuary 1
Area of city16 square miles
Percent of City developed with buildings97%
Municipal bond ratingAaa
Miles of streets224 miles
Miles of sanitary sewer186.22 miles
Sewer connections14,851
Fire protection:
Number of stations2
Number of employees (full time)31
Police Protection:
Number of stations1
Number of employees (full time)67
Park land:
Present park acres and open space1,600
Total improved park acres1,007
Number of parks40
Private golf courses2
Public golf courses3
Municipal water:
Number of wells18
Miles of watermain199
Gallons of storage7 million
Number of consumers14,636
105