HomeMy WebLinkAbout4.F.4. Fund Establishment and Inter-fund loan 011111111 Consent Business 4. F. 4.
SHAKOPEE
TO: Mayor and City Council
FROM: Jean McGann, Interim Finance Director
DATE: 05/19/2015
SUBJECT: Fund Establishment and Inter-fund Loan (C)
Action Sought
The Council is asked to approve the establishment of a new Enterprise Fund for
Garbage and revise the inter-fund loan for refuse and recycling carts.
Background
In 2014, the City entered into a new contract for garbage services. As part of this
transaction, the City purchased enough refuse and recycling carts for all residential
properties within the municipal service area. 'le Council approved two purchases
of garbage carts; the first on January 21, 2014 and the second on April 29, 2014.
These were bothfunded by a loan from the Sanitary Sewer Fund. To repay this
loan, a monthly fee is collected from each user of the garbage carts.
To appropriately account for the garbage carts, fees and inter-fund loan associated
with this purchase, staff and the City auditors are recommending that a new
Enterprise Fund be established. The carts will be written off over time and the
Garbage Enterprise Fund will repay the inter-fund loan to the Sanitary Sewer Fund.
Requested Action
If the Council concurs, it should authorize the establishment of an Enterprise Fund
for Garbage and revise the inter-fund loan from the Sanitary Sewer Fund to be
repaid by the Garbage Enterprise Fund.