HomeMy WebLinkAbout7. 2011 Annual Financial Report and Audit Presentation by Kern DeWenter, Viere, Ltd. (KDV) �.
City of Shakopee
Memorandum
To: Mayor and City Council
Mark McNeill, City Administrator , /
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From: Julie A. Linnihan, Finance Director _�
Subject: 2011 Annual Financial Report and Audit Presentation
Date: May 15, 2012
Introduction:
The City of Shakopee annually completes the audit process that provides the information for the
Comprehensive Annual Financial Report (CAFR).The audit also provides the City with two other reports,
Report on Compliance with Government Auditing Standards and Minnesota Legal Compliance, as well as
the Management Letter.The City was not required to undertake a "single audit" process in 2011, as the
City did not have federal expenditures in excess of$500,000 in 2011, which would have required this
specific audit compliance.
Back�round:
Audit staff from Kern, DeWenter,Viere, Ltd. (KDV) conducted the annual audit process beginning in
December of 2011, and this continued into April of 2012.The results of the financial report and the
audit process will be presented on May 15th, 2012 to the City Council. Finance staff, City Administrator
and KDV audit staff have recently met to review the audit and financial report information.
Requested Action:
Staff request acceptance of the 2011 audit and accompanying reports.
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� For the Ci of Shako ee, Minnesota
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� For the Fiscal Year Ended
� December 31 , 2011
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' CITY OF SHAKOPEE, MINNESOTA
, Scott County
� COMPREHENSIVE ANNUAL FINANCIAL REPORT
For the Year Ended
' December 31, 2011
' DEPARTMENT OF FINANCE
� JULIE LINNIHAN, Director of Finance
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MEMBER OF GOVERNMENT FINANCE OFFICERS ASSOCIATION
' OF THE UNITED STATES AND CANADA
' 129 HOLMES STREET SOUTH
SHAKOPEE, MN 55379
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, CITY OF SHAKOPEE
TABLE OF CONTENTS
' SECTION I
' Page
INTRODUCTORY SECTION
Elected Officials and Administration................................................................................ 1
OrganizationChart............................................................................................................ 2
' Letter of Transmittal ......................................................................................................... 3
Certificate of Achievement for Excellence in Financial Reporting.................................. 7
' SECTION II
FINANCIAL SECTION
' Independent Auditor's Report........................................................................................... 9
Management's Discussion and Analysis (Unaudited) ...................................................... 11
Basic Financial Statements:
' Government-Wide Financial Statements:
Statement of Net Assets........................................................................................ 24
Statement of Activities.......................................................................................... 25
Fund Financial Statements:
, Balance Sheet—Governmental Funds.................................................................. 26
Reconciliation of the Balance Sheet to the Statement of Net Assets—
GovernmentalFunds........................................................................................... 27
, Statement of Revenues, Expenditures and Changes in Fund Balances—
Governmental Funds........................................................................................... 28
Reconciliation of the Statement of Revenues, Expenditures and Changes in
' Fund Balances to the Statement of Activities—Governmental Funds ............... 29
Statement of Revenues, Expenditures and Changes in Fund Balances—
Budget and Actual—General Fund..................................................................... 31
� Statement of Net Assets—Proprietary Funds ....................................................... 32
Statement of Revenues, Expenses and Changes in Fund Net Assets—
ProprietaryFunds................................................................................................ 33
Statement of Cash Flows—Proprietary Funds...................................................... 34
' Statement of Net Assets—Component Units........................................................ 36
Statement of Revenues, Expenses and Changes in Fund Net Assets—
ComponentUnits................................................................................................ 37
� Statement of Cash Flows—Component Units - SPUC......................................... 38
Combined Statement of Fiduciary Net Assets...................................................... 40
Notes to the Financial Statements............................................................................... 41
' Required Supplementary Information:
Schedule of Funding Progress—Other Post Employment Benefits............................ 74
Supplementary Information:
' Schedule of Revenues, Expenditures and Changes in Fund Balance—
Budget and Actual—General Fund........................................................................... 76
Combining and Individual Fund Financial Statements and Schedules:
' Combining Balance Sheet—Nonmajor Governmental Funds.............................. 78
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances—Nonmajor Governmental Funds ....................................................... 84
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CITY OF SHAKOPEE '
TABLE OF CONTENTS
SECTION II '
Table Page '
FINANCIAL SECTION
Supplementary Information: (Continued)
Combining and Individual Fund Financial Statements and Schedules: (Continued) '
Schedule of Revenues, Expenditures and Changes in Fund Balance—
Budget and Actual.
TransitFund.................................................................................................... 90
Economic Development Authority Fund........................................................ 91 '
Combining Statement of Fund Net Assets—Internal Service Funds.................... 92
Combining Statement of Revenues, Expenses and Changes in Fund Net
Assets—Internal Service Funds.......................................................................... 93 '
Combining Statement of Cash Flows—Internal Service Funds ........................... 94
Statement Fiduciary Net Assets—Escrow Agency Fund...................................... 95
Statement of Changes in Assets and Liabilities—Escrow Agency Fund.............. 96 '
SECTION III
STATISTICAL SECTION '
NetAssets by Component................................................................................................. 1 100
Changesin Net Assets ...................................................................................................... 2 102 '
Fund Balances—Governmental Funds ............................................................................. 3 l 06
Changes in Fund Balances—Governmental Funds........................................................... 4 108
Tax Capacity and Estimated Actual Value of Taxable Property...................................... 5 110
Direct and Overlapping Property Tax Rates..................................................................... 6 111 '
PrincipalTaxpayers........................................................................................................... 7 112
Property Tax Levies and Collections................................................................................ 8 113
Ratio of Outstanding Debt by Type.................................................................................. 9 114 �
Ratio of General Bonded Outstanding.............................................................................. 10 115
Direct and Overlapping Governmental Activities Debt.................................................... 11 117
Legal Debt Margin Information........................................................................................ 12 118 '
PledgedRevenue Coverage .............................................................................................. 13 120
Demographic and Economic Statistics ............................................................................. 14 121
PrincipalEmployers.......................................................................................................... 15 123 �
Full-Time Equivalent City Government Employees by Function/Program...................... 16 124
Operating Indicators by Function/Program....................................................................... 17 126
Capital Asset Statistics by Function/Program................................................................... 18 128
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� CITY OF SHAKOPEE
, ELECTED OFFICIALS AND ADMINISTRATION
December 31, 2011
' Elected Officials Position Term Expires
' John Schmitt Mayor December 31, 2011
' Matthew Lehman Council Member December 31, 2011
Patrick Heitzman Council Member December 31, 2011
tSteven Clay Council Member December 31, 2013
, Pamela Punt Council Member December 31, 2013
' Administration
Mark H. McNeill City Administrator Appointed
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Julie Linnihan Finance Director Appointed
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CITY OF SHAKOPEE
ORGANIZATION CHART
December 31, 2011
ELECTORATE
CITY COUNCIL
Planning Commission and Board of Adjustment and Appeals Building Code Board of Adjustment and Appeals
Police Civil Service Commission Te►ecommunications Advisory Commission
Park and Recreation Advisory Board Board of Review
Economic Development Authority Public Utilities Commission
Environmental Advisory Commission Historic Preservation Commission
Administration
Police Fire Public Works Recreation Finance Community City Clerk
Development
Emergcncy Management E�gineering Operations Planning Building[nspection
Transit
Streets/Parks Sewers
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SHAKOPEE
, April 25'h, 2012
1 To the Honorable Mayor, Members of the City Council,and Citizens of the City of Shakopee:
' Minnesota Statutes require every city publish within six months of the close of each fiscal year a complete
set of audited financial statements.This report is published to fulfill that specific requirement for the fiscal
year ended December 31, 2011.
' Management assumes full responsibility for the completeness and reliability of all of the information
presented in the report, based upon a comprehensive framework of internal control that has been
established for this purpose. The costs of internal control should not exceed anticipated benefits and
' therefore the object is to provide reasonable rather than absolute assurance that the financial statements
are free from material misstatement.
' The City of Shakopee's financial statements have been audited by Kern, DeWenter, Viere, Ltd., a firm of
licensed certified public accountants. An unqualified ("clean") opinion on the City's financial statements
for the year ended December 31, 2011 has been issued. The independent audit involved examining, on a
' test basis, evidence supporting the amounts and disclosures in the financial statements; assessing the
accounting principles used and significant estimates made by management as well as evaluating the
overall financial statement presentation. The independent auditor's report is presented as the first
' component of the financial section of this report.
Management Discussion and Analysis (MD &A) immediately follows the independent auditor's report and
' provides a narrative introduction, overview, and analysis to accompany the basic financial statements.
This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it.
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Profile of the City
, The City of Shakopee was incorporated for the second time in 1870 and is located approximately 25 miles
southwest of Minneapolis. Bounded by the Minnesota River on the north, Shakopee is in the northern
' part of Scott County and is the county seat. In recent years, the City has been one of the most rapidly
growing communities of the state. The 2000 population of the City was 20,568 and the land area covered
is approximately 30 square miles. The 2010 census confirmed that the population has increased to 37,076
, and is anticipated to continue on a consistent growth pattern. This increase continues to maintain
Shakopee as one of the most rapidly growing suburbs in Minnesota. Growth, while slowing since the mid
2000's, continues to provide Shakopee with the assurance that the city's unique blend of residential,
� commercial and industrial opportunities will provide a strong base for the economic health of the
community and region.Approximately 45%of the community is developed,with approximately 28%of the
developed land as residential. The City levies a property tax on both real and personal property located
� within its boundaries. The City may also by state statute, extend its corporate limits by annexation, which
historically has occurred periodically.
COMMLTNITY PRIDE SINCE 1857
� I?9 Holmcs Strcet South • Shakopee. blinnesot.� • Si379-13�1 • 9�� ?1>-93i �.i • F��X 9�?-�� ?-;S�)I • ����« ei ,hakopee mn us 3
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Shakopee is organized in Minnesota under Plan A, which includes a City Administrator, but the City Council
retains primary decision making authority such as policy setting, adopting ordinances and budget and '
staffing. The City Council has four members who serve staggered terms of four years plus the Mayor who
serves a two-year term. All council positions are non-partisan, part-time and members are elected at
large. '
The City provides the typical municipal services such as police and fire protection, street and
infrastructure construction, public works maintenance, parks, recreation, planning and zoning. Also �
provided are utilities such as sewer and storm drainage utilities, organized refuse collection, recycling,
and certain transit services. Electric and water utilities are operated by Shakopee Public Utilities
Commission which is appointed by the City Council and is included as a component unit of the City. '
Housing, economic development and redevelopment are controlled by the Shakopee Economic
Development Authority. The Authority is comprised of City Council members and is included as an
integral part of the City's report. '
The annual budget is the basis for the City's financial planning and control. The budget is prepared by
Fund (e.g., General), function (e.g., Public Works) and department (e.g., Engineering). Budget requests are ,
submitted in July by Department Heads. The City Administrator reviews the submittals with the Finance
Director and Department Head, to determine specific budget requests and presentations to the City
Council. The City Council is presented with a proposed budget and tax levy in August of each year. City '
Council is required to adopt a maximum tax levy by September 15. The final tax levy and budget are
adopted in December after a public hearing. Budgeting control is provided by an annual budget resolution
passed by City Council (or EDA as appropriate). Formal control is at the division level and Council action is '
necessary to change budgeted amounts between divisions and/or funds. The Finance Director or City
Administrator may make changes within divisions.
Along with the operating budget,a five-year capital improvement plan and a ten-year major equipment list ,
is also annually prepared. Internal Service funds are utilized for the definition and application of charges
for equipment, buildings, park assets, and information technology. These charges are integrated into the '
individual budgets of the funds and departments that are benefitted by the activities of the programs. The
Internal Service funds continue to be reviewed and updated as the community needs and council
directives are considered during each budget cycle. Budget-to-actual comparisons are provided in this '
report for each individual governmental fund for which an appropriated annual budget has been formally
adopted.
Local Economy ,
The City continues to experience a stable and healthy economic environment, and is fortunate to be a site '
for planned commercial, industrial and residential growth. Building permits have decreased from the prior
years of significant growth, yet the volume of permits is maintaining at a strong level of growth, allowing
for a consistent level of building and permit revenue. The City is currently experiencing strong interest in '
the available commercial and industrial sites.There are currently projects that are being considered by the
Economic Development Authority and City Council for tax abatement and tax increment financing options
that will provide the community with a broader array of job opportunities and commercial options. �
Housing and related development continues to maintain a steady growth pattern, as the community
provides a broad base of housing options for a mix of single family and multi-family residences. Senior
housing options also being reviewed, as the changing demographics of the area will require a response to '
these rapidly changing family needs and expectations.
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The local commercial industrial sector continues to maintain a strong and consistent base for community
' growth in terms of tax capacity as well as job opportunities. The City has traditionally had a strong
industrial base with commercial/industrial property currently comprising 24%of market value and 37%of
tax capacity. The largest commercial/industrial taxpayer comprises 1.2% of total tax capacity, which is
, consistent with prior years'and represents the broad diversity of the local tax base. Companies in the City
manufacture chemicals, food products, roofing products,glass, cardboard and electronics. Health care and
related industries continue to progress on positive trends as wel� benefitting from the continuing
' expansion of a trained and skilled work force.
Late in the 2011 legislative session, adjustments were made to the property tax classification structure that
' has now impacted the market values of all classifications of property. This has resulted in variances in the
comparable numbers for the market value of properties and has ultimately reduced the market values of
property, and also resulting in an increase in tax rates even if property tax levies were held flat. This
' resulted in a difficult and challenging year for budget presentations as well as community information, and
as a result, little adjustment or changes were made to the proposed property tax levies, resulting in limited
program changes or adjustments to capital plans, requiring an increased levy. The city is fortunate to not
� experience large decreases in market values that several surrounding communities have dealt with, but
Council and staff are aware that the confusing and lack of comparable data resulting from the recent
legislative changes require staff to consider and apply conservative and thoughtful approaches to future
' budget needs and levies.
long-term Financial Planning. Dependent on the volume of infrastructure work the City issues bonds to
� fund infrastructure replacement, expansion and additions for the growing population each year, or every
other year. Much of this debt is funded by special assessments against benefited properties. Recently the
City has revised the Assessment Policy, and no longer levies special assessments for street overlays. While
' this has not impacted the funding mechanisms for the majority of street projects, it does require the
identification of an alternative funding source. This may be developed through specific inter-fund
transfers, or designation of a portion of the General levy.A replacement fire station has recently been built
' replacing the existing fire station located in a less densely populated area of the City. Within the next five
years a satellite station may be built to meet the needs of a growing population, as well as educational and
commercial and industrial growth.
� The City of Shakopee annually prepares an updated five-year capital improvement plan and ten year
capital equipment list, along with an annual budget, which are presented to Council for approval.
' Relevant Financial Policies
The City's target General Fund balance is to maintain an unassigned level between 40% (minimum) and
' 45% of current year expenditures. This level is to provide working capital for cash flow, expected
decline in revenues and unforeseen expenditures such as natural disasters. Replenishing fund balance
when it falls below the target level shall be accomplished by interfund transfers or budgeting for
' expenditures and other uses to be less than revenues or other sources over a period not to exceed three
yea rs.
� The City typically receives no local government aid (LGA) or market value homestead credit (MVHC)
from the State of Minnesota. Annual legislative actions may impact the financial position of cities that
are currently reliant on these and other revenue sources, leaving them vulnerable to the economies of
� the State as a whole.
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The major source of revenue for the General Fund is property taxes which are received one half in lune
and one half in December. The property tax levy, induding levies for debt service and the Economic '
Development Authority(EDA) are approved as a component of the annual budget process.
The accounting, auditing and financial reporting policies are designed to maintain a system of financial '
monitoring, contro►and reporting for all operations and funds in order to provide effective means of
ensuring that overall City goals and objectives will be met and to assure the City's residents and
investors that the City is well managed and fiscally sound. �
The investment policy provides for conservative investing, preserving capital and maintaining adequate
liquidity for forecasted cash needs. A third party investment manager handles the majority of the portfolio '
and all investments are held in a trust account.
The debt policy ensures that the City's debt; 1)does not weaken the City's financial structure; and 2) '
provide limits on debt to avoid problems in servicing debt. This policy is critical for maintaining the best
possible credit rating.
Capital policies include having expenditures forecast ahead for five to ten years and are updated annually. �
Internal Service Funds for major equipment, major buildings and facilities, park asset replacement and
information technology costs stabilize the annual impact of those items to the General fund. ,
Awards and Acknowledgements
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a ,
Certificate of Achievement for Excellence in Financial Reporting to the City of Shakopee for its
Comprehensive Annual Financial Report (CAFR)for the fiscal year ended December 31, 2010. This was '
the twenty seventh consecutive year that the City has received this award. In order to be awarded a
Certificate of Achievement, a government must publish an easily readable and efficiently organized
CAFR. This report satisfied both GAAP and applicable legal requirements. '
A Certificate of Achievement is valid for a period of one year only. We believe our current CAFR
continues to meet the Certificate of Achievement Program's requirements and we are submitting it to '
the GFOA to determine its eligibility for another certificate.
The preparation of this report would not have been possible without the efficient and dedicated services ,
of the Finance Department and the entire city staff. We would like to express our appreciation to all
staff members who assisted and contributed to the preparation of this report. Credit also must be given
to the Mayor and Councilors for their unfailing support for maintaining the highest standards of '
professionalism in the management of the City of Shakopee's finances.
Respectfully submitted, �
' / � J
Y ���.�fe �LG�X-L (.�[ '�t��'li�we�-rt�1
Mark McNeill Julie A. Linnihan �
Administrator Finance Director
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Certificate of
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Achlevement
� for Excellence
in Financial
� Re ortin
p g
� Presented to
City of Shakopee
� Minnesota
� For its Comprehensive Annual
Financial Report
� for the Fiscal Year Ended
December 31,2010
A Certificate of Achievement for Excellence in Financial
' Reporting is presented by the Govemment Finance Officers
Associarion of the United States and Canada to
govemment units and public employee retuement
systems whose comprehensive annual financial
� reports(CAFRs)achieve the highest
standards in government accounting
and financial reporting.
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' E.�pert advice. When you need it.`"'
� INDEPENDENT AUDITOR'S REPORT
'
Honorable Mayor and Members
� of the City Council
City of Shakopee
Shakopee, Minnesota
� We have audited the accom an 'n financial statements of the overnmental activities the business- e
P Yl g g , typ
activities, each major fund and the aggregate remaining fund information of the City of Shakopee,
' Minnesota, as of and for the year ended December 31, 2011, which collectively comprise the City's
basic financial statements as listed in the Table of Contents. These financial statements are the
responsibility of the City's management. Our responsibility is to express opinions on these financial
, statements based on our audit.
We conducted our audit in accordance with U.S. generally accepted auditing standards and the standards
' applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller
General of the United States. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement. An audit
� includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement presentation. We believe our
� audit provides a reasonable basis for our opinions.
In our opinion, the financial statements referred to above present fairly, in all material respects, the
' respective financial position of the governmental activities, the business-type activities, each majar fund
and the aggregate remaining fund information of the City of Shakopee, Minnesota, as of December 31,
2011, and the respective changes in financial position and where applicable, cash flows, thereof, and the
respective budgetary comparison for the General Fund for the year then ended in conformity with U.S.
� generally accepted accounting principles.
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� Wealth Management St.Cloud,Minnesota Bloomington,Minnesota 877•912.7696
Payrol!Services 56302 55431 Technology Help Desk
Business 6'aluations Phone:320.251.7010 Phone:952.563.6800 866.400.6426
Technology Services Fax:320.251.1784 Fax:952.563.6801
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In accordance with Government Auditing Standards, we have also issued our report dated April 25, '
2012, on our consideration of the City's internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts and grant agreements and other
matters. The purpose of that report is to describe the scope of our testing of internal control over �
financial reporting and compliance and the results of that testing and not to provide an opinion on the
internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards and should be considered in assessing the ,
results of our audit.
U.S. generally accepted accounting principles require that the Management's Discussion and Analysis, '
which follows this report letter, and the Schedule of Funding Progress— Other Post Employment
Benefits, as listed in the Table of Contents, to be presented to supplement the basic financial statements.
Such information, although not a part of the basic financial statements, is required by the Governmental '
Accounting Standards Board (GASB),who considers it to be an essential part of financial reporting for
placing the basic financial statements in an appropriate operational, economic or historical context. We
have applied certain limited procedures to the required supplementary information in accordance with '
U.S. generally accepted auditing standards, which consisted of inquiries of management about the
methods of preparing the information and comparing the information for consistency with management's
responses to our inquiries, the basic financial statements and other knowledge we obtained during our
audit of the basic financial statements. We do not express an opinion or provide any assurance on the '
information because the limited procedures do not provide us with sufficient evidence to express an
opinion or provide any assurance.
Our audit was conducted for the purpose of forming opinions on the financial statements that '
collectively comprise the City's financial statements as a whole. The accompanying supplementary
information identified in the Table of Contents is presented for purposes of additional analysis and is not �
a required part of the financial statements. The supplementary information is the responsibility of
management and was derived from and relate directly to, the underlying accounting and other records
used to prepare the financial statements. The information has been subjected to the auditing procedures �
applied in the audit of the financial statements and certain additional procedures, including comparing
and reconciling such information directly to the underlying accounting and other records used to prepare
the financial statements or to the financial statements themselves, and other procedures in accordance '
with U.S. generally accepted auditing standards. In our opinion, the information is fairly stated, in all
material respects in relation to the financial statements as a whole.
The information identified in the Table of Contents as the Introductory and Statistical Sections are '
presented for purposes of additional analysis and are not a required part of the basic financial statements.
This information has not been subjected to the audit procedures applied in the audit of the basic financial
statements and, accordingly, we express no opinion on it. '
�l�C�- `
. ,� t,�.�".�, �.-�.,, r� �
KERN, DEWENTER, VIERE, LTD.
Bloomington, Minnesota '
Apri125, 2012
�
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� CITY OF SHAKOPEE
MANAGEMENT'S DISCUSSION AND ANALYSIS
� December 31,2011
As management of the City of Shakopee (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 year ended
December 31, 2011. 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 3 to 6 of this report.
Financial Highlights
� • The assets of the City exceeded its liabilities at the close of the most recent year by$ 255.6
million (net assets). Of this amount, $ 64.7 million (unrestricted net assets) may be used to meet
� the City's ongoing obligations to citizens and creditors.
• The City's total net assets increased by $ 597,000.
• As of the close of the current year, the City's governmental funds reported combined ending
fund balances of$ 24.0 million, slightly lower than the prior year. Approximately 36% of this
� total amount, $ 8.7 million is available for spending at the City's discretion (unassigned fund
balance).
• At the end of the current year, unassigned fund balance for the General Fund was $ 9.2 million,
' or 49%, of total General Fund expenditures.
• The City's total bonded debt decreased by$ 2.6 million, or 13.7%, during the current year.
� Overview of the Financial Statements
This discussion and analysis are 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 private-sector business.
The Statement of Net Assets presents information on all of the City's assets and liabilities, with the
� difference between the two reported as net assets. Over time, increases or decreases in net assets may
serve as a useful indicator of whether the financial position of the City is improving or deteriorating.
' The Statement of Activities presents information showing how the City's net assets changed during the
most recent 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 employee leaves).
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,
� highways and streets, economic development and recreation. The business-type activities of the City
include sewer and storm drainage utilities.
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CITY OF SHAKOPEE '
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2011 �
The government-wide financial statements include not only the City itself(known as the primary
government), but also two legally separate entities for which the City is financially accountable. The '
component units are Shakopee Public Utilities Commission (SPUC) and the Economic Development
Authority(EDA). SPUC's financial information is reported separately from the financial information
presented for the primary government as a discretely presented component unit. The EDA, which �
functions like a department of the City although it is a legally separate entity, is presented within the
City's government-wide financial statements. The City Council is the EDA Board.
The government-wide financial statements can be found on pages 24 and 25 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.
Government Funds ,
Government 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 year. Such �
information may be useful in evaluating a City's near-term financing's requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial
statements, it is useful to compare the information presented for governmental funds with similar '
information presented for governmental activities in the government-wide financial statements. By
doing so, readers may better understand the long-term impact of the City's near-term financing
decisions. The governmental funds Balance Sheet and the governmental funds Statement of Revenues, '
Expenditures and Changes in Fund Balances provide a reconciliation to facilitate this comparison
between governmental funds and governmental activities.
The City maintains 25 individual governmental funds. Information is presented separately in the �
governmental funds Balance Sheet and in the governmental funds Statement of Revenues, Expenditures
and Changes in Fund Balances for the General Fund, the 2004A Improvement Bond Debt Service Fund, ,
the 2007A Improvement Bond Debt Service Fund and the Capital Improvement Capital Project Fund.
Those are considered to be major funds. Data from the other governmental funds are combined into a
single, aggregated presentation. Individual fund data for each of these non-major governmental funds is
provided in the form of combining statements elsewhere in this report. '
The City adopts an annual appropriated budget for its General Fund and two of its Special Revenue
Funds. A budgetary comparison statement has been prepared for those funds to demonstrate compliance �
with the budget.
The basic governmental funds financial statements can be found on pages 26 to 31 of this report. '
IZ �
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, CITY OF SHAKOPEE
MANAGEMENT'S DISCUSSION AND ANALYSIS
� December 31, 2011
' Proprietary Funds
The City maintains two different types of proprietary funds. Enterprise funds are used to report the
same functions presented as business-type activities in the government-wide financial statements. The
' City uses enterprise funds to account for its sewer and storm drainage operations. Internal service funds
are an accounting device used to accumulate and allocate costs internally among the City's various
functions. The City uses internal service funds to account for its fleet of vehicles and mobile equipment,
, its major buildings, the replacement of park assets, information technology items and for employee
compensated absences. All of these services predominantly benefit governmental rather than business-
type functions.
' Proprietary funds provide the same type of information as the government-wide financial statements.
The proprietary fund financial statements provide separate information for the sewer and storm drainage
operations, all of which are considered to be major funds of the City. Conversely, all internal service
' funds are combined into a single, aggregated presentation in the proprietary fund financial statements.
Individual fund data for the internal service funds is provided in the form of combining statements
elsewhere in this report.
' The basic proprietary fund financial statements can be found on pages 32 to 35 of this report.
� Component Units
Component units are legally separate organizations for which the City is financially accountable. The
' government-wide financial statements present information for the component units in a single column
on the Statement of Net Assets. Also, some information on the Statement of Changes in Net Assets is
aggregated for component units. The component units' Statements of Net Assets and Statement of
Changes in Net Assets provide detail for each major component unit.
, 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 statement because the resources of
those funds are not available to support the City's own programs.
' The basic fiduciary fund financial statements can be found on page 40 of this report.
tNotes 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 41 to 72 of this report.
Other Information
' ln addition to the basic financial statements and accompanying notes, this report also presents certain
required supplementary information concerning the City's progress in funding its obligation to provide
, pension benefits to its employees.
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CITY OF SHAKOPEE '
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, ZO11 �
The combining statements referred to earlier in connection with nonmajor governmental funds, internal '
service funds and fiduciary funds are presented immediately following the required supplementary
information on pensions. Combining and individual fund statements and schedules can be found on
pages 76 to 96 of this report.
GOVERNMENT-WIDE FINANCIAL ANALYSIS '
As noted earlier, net assets may serve over time as a useful indicator of a City's financial position. For '
the City, assets exceeded liabilities by$ 255.6 million at the close of the most recent year.
By far the largest portion of the City's net assets (70%) reflects its investment in capital assets (e.g., '
land, buildings and equipment); less any related debt used to acquire those assets that is still outstanding.
The City used 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.
Net Assets ,
(Expressed in Thousand)
Governmental Activities Business-Type Activities Total �
2011 2010 2011 2010,Restated 2011 2010,Restated
Current and Other Assets $ 48,799 $ 49,844 $ 33,433 $ 33,463 $ 82,232 $ 83,307 '
Capital Assets 131,127 130,615 65,080 64,220 196,207 194,835
Total Assets $ 179,926 $ 180,459 $ 98,513 $ 97,683 $ 278,439 $ 278,142
Long-Term Liabilities �
Outstanding $ 15,830 $ 17,065 $ 74 $ 59 $ 15,904 $ 17,124
Other Liabilities 5,428 5,735 1,431 204 6,859 5,939 '
Total Liabilities $ 21,258 $ 22,800 $ 1,505 $ 263 $ 22,763 $ 23,063
NET ASSETS: '
Invested in Capital Assets,
Net of Related Debt $ 114,982 $ 111,905 $ 65,080 $ 64,220 $ 180,062 $ 176,125
Restricted 10,915 1,844 - - 10,915 1,844 '
Unrestricted 32,771 43,910 31,928 33,200 64,699 77,110
Total Net Assets $ 158,668 $ 157,659 $ 97,008 $ 97,420 $ 255,676 $ 255,079 '
An additional portion of the City's net assets (4%) represents resources that are subject to external
restrictions on how they may be used. The remaining balance of unrestricted net assets ($ 65 million) �
may be used to meet the City's ongoing obligations to citizens and creditors.
At the end of the current year, the City was 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. The same situation held true for the prior year.
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' CITY OF SHAKOPEE
MANAGEMENT'S DISCUSSION AND ANALYSIS
� December 31, 2011
During the current year, the City's net assets increased by $ 596 thousand. The enterprise fund activities
, actually decreased net assets during 2011 with revenues decreasing at a greater rate than expenses.
Changes in Net Assets
t (Expressed in Thousands)
Governmental Acvtivities Business-Type Activities Total
' 2011 2010,Restated 2011 2010,Restated 2011 2010,Restated
REVENUES:
Program Revenues:
Charges for Services $ 3,781 $ 4,350 $ 4,026 $ 4,791 $ 7,807' $ 9,141
' Operating Grants and
Contributions 3,606 2,944 6 3,606 2,950
Capital Grants and
Contributions 3,153 952 93 445 3,246 1,397
' General Revenues:
Property Taxes 14,488 14,229 14,488 14,229
Other Taxes 161 148 - - 161 148
' Other 1,032 1,040 758 936 1,790 1,976
Total Revenues 26,221 23,663 4,877 6,178 31,098 29,841
EXPENSES:
' General Government 4,253 4,225 - - 4,253 4,225
Public Safety 9,237 9,123 9,237 9,123
Public Works 7,094 7,216 - - 7,094 7,216
Economic Development 244 427 - - 244 427
' Culture and Recreation 3,866 3,766 _ - 3,866 3,766
Interest on Long-Term Debt 619 785 619 785
Electric - - _ _
Water - - _ _
' Sewer - - 3,807 3,685 3,807 3,685
Storm - - 1,382 1,793 1,382 1,793
Total Expenses 25,313 25,542 5,189 5,478 30,502 31,020
' Increase(Decrease in Net
Assets before Transfers 908 (1,879) (312) 700 596 (1,179)
� Transfers 100 2,089 (100) (l00 _
) 1,989
Change in Net Assets 1,008 210 (412) 600 596 810
, NET ASSETS:
January 1 157,659 157,449 97,420 96,820 255,079 254,269
December 31 $ 158,667 $ 157,659 $ 97,008 $ 97,420 $ 255,675 $ 255,079
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CITY OF SHAKOPEE '
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2011 �
Governmental Activities
Governmental activities increased the City's net assets by $ 1,008,338. The major increase was a result '
of municipal state aid revenue coming in on construction projects.
Expenses and Program Revenues—Governmental Activities '
$�o,�o,00a _ __ ___ -- _� 1
$9,000,000 ----- ----- ----
$8,000,000 --- _,___—___ _-------
$'7,000,000 ------ --- ----- — '
$6,000,000 ------ --- ---
$5,000,000 �� ___._ _.� •Program Revenues
$4,000,000 - -- ---�---- __ ■Expenses '
$3,000,000 - -- -
$2,000,000 -- — - ----- --__.
$1,000,000 - — --- - —�--- '
$- .,.
?� r c on
y y �x.. U � O � ,
� � c�'d p •� '�ry FO .�D
N
y N U U C � � p Q
� � � � W � Q�r � �
Q y (--� '
.—�i
Revenues by Source—Governmental Activities
Operatmg Grants ,
Other Revenues and
4% Contnbutions ,
14%
Charges for �. - Capital Grants
Services ti '
14% � and
'y '' Contnbutions
t � 12%
1�
Other Taxes �`� ,
1%
,,� _ ,. ., , ,... ;..,� '
_- __ _ . __ .:
,�_ '
Property Taxes
55% '
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, CITY OF SHAKOPEE
MANAGEMENT'S DISCUSSION AND ANALYSIS
� December 31, 2011
' Business-Type Activities
Business-type activities decreased the City's net assets by $ 412,090. During 2011, it was determined
SPUC no longer met the criteria of a blended component unit and it was determined SPUC's funds
' would be presented as discretely presented component units prospectively. Key elements of this
decrease are as follows:
' • Decrease in charges for services of$ 1,358,725 as the utility funds have experienced decreased
revenue collections due to decreased rates and usage as well as less connection charges due to a
decline in new development.
' • Expenses increased in 2011 due to higher Met Council fees.
• Net transfers— $ (100,000), in comparison to the net transfer of$ (2,100,000), in 2010 due to
changing activity since SPUC is now discretely presented instead of blended.
, Expenses and Program Revenues—Business-Type Activities
$4,000,000
' $3,500,000 — ------
$3,000,000 -- — — --_
' $2,500,000 -- ------- ------
$2,000,000 -- ----- ------------- IE7Program
' Revenues
$1,500,000 — — -- __ •Expenses
' $1,000,000 =-- �--
$500,000 -
�
°,�:
' $ Sewer Storrn
, Revenues by Source—Business-Type Activities
Capital Grants
and
' Contrtbutions
2%
' Char es for
Investment� � g
��gs Services
' l6% 82%
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CITY OF SHAKOPEE '
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2011 �
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, assigned and unassigned fund balance may serve as a useful measure of a
City's net resources available for spending at the end of the year. '
As of the end of the current year, the City's governmental funds reported combined ending fund
balances of$ 24,043,066, a decrease of$ 3,051,384 in comparison with the prior year. Approximately
36%, ($ 8,688,658), of the total amount constitutes unassigned fund balance, which is available for '
spending at the City's discretion. Approximately 31%, ($ 7,377,475), of the total amount constitutes
assigned fund balance, which is assigned for designated purposes. The remainder of fund balance,
($ 7,976,933), is not available for new spending because it has already been restricted or is ,
nonspendable.
The General Fund is the chief operating fund of the City. At the end of the current year, fund balance of '
the General Fund was $ 9,304,194. As a measure of the General Fund's liquidity, it may be useful to
compare fund balance (assigned and unassigned) to total fund expenditures. Fund balance represents
49% of total General Fund expenditures. '
Fund balance of the City's General Fund increased by $ 266,464 during the current year. Key factors in
this increase consist of the following:
• Before transfer fund balance of the General Fund resulted in a $ 2,280,000 increase. After the �
net transfer of$ 2,010,000 fund balance increased $ 270,000. Transfers provided the necessary
funding for several significant capital, infrastructure and facility expansions that will be '
undertaken.
• Revenues exceeded the budget by$ 1.2 million,or 6.3 %. Tax collections and building permit revenues
exceeded expectations. '
• Under-spending the budget by$ 1.5 million, or 7.4%. City staff continued a trend of
conservative spending, as well as vacant staff positions left unfilled in 2011.
Proprietary funds '
The City's proprietary funds provide the same type of information found in the government-wide
financial statements, but in more detail. �
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' CITY OF SHAKOPEE
MANAGEMENT'S DISCUSSION AND ANALYSIS
� December 31, 2011
Unrestricted net assets of the enterprise funds:
� S ewer Storm
, Beginning of Year $ 16,802 $ 16,397
Change During Year (441) (888)
� End of Year $ 16,361 $ 15,509
GENERAL FUND BUDGETARY HIGHLIGHTS
' The original legally adopted budget for expenditures was $ 20,175,640 and transfers out were $ 0 with
no budget adjustments. Actual expenditures of$ 18,674,938 were $ 1,500,702 under budget. The
' variance was a result of postponing hires of several positions, lower than anticipated commodity costs
and deferred projects and repairs. Original and final adopted budgets for revenues were $ 19,707,420
and transfers in were$ 122,400. Actual revenues of$ 20,956,396 were$ 1,248,976 over budget. This
, was a result of a correction by the county for 2010 disparities, an increase in collection of property taxes
on top of conservative budgeting and increased collections for charges for services.
, 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, 2011, amounts to $ 180,062,025 (net of accumulated depreciation and related debt). This
investment in capital assets includes land, buildings and systems, improvement, machinery and
, equipment, park facilities, roads, highways and bridges. The City's capital assets for the current year
were similar to the previous year, with an increase in construction in progress, and a decrease in related
debt.
' Major capital assets events during the current year included the following:
' • Work was continued on the fire station at Vierling Drive which added $ 2,400,000. This project
will be completed in early 2012.
• A variety of street, park and building construction projects were started and awaiting completion
with a value of$ 2,700,000 along with $ 1,600,000 in completed street and park projects.
' • Equipment added $ 1,176,000.
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CITY OF SHAKOPEE '
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2011 �
Capital Assets �
(Net of Depreciation)
Expressed in Thousands
Governmental Activities Business-Type Activities Total '
20ll 2010 2011 2010,Restated 2011 2010
Land $ 19,488 $ 19,488 $ 3,944 $ 3,944 $ 23,432 $ 23,432 '
ROW - - 75 - 75 -
Construction in Progress 5,300 730 1,745 - 7,045 730
Line Rights 916 941 916 941 �
Infrastructure 74,817 77,541 56,886 57,987 131,703 135,528
Buildings 24,230 25,078 - - 24,230 25,078
Machinery and Equipment 7,292 7,778 1,514 1,348 8,806 9,126 '
Total $ 131,127 $ 130,615 $ 65,080 $ 64,220 $ 196,207 $ 194,835
Additional information on the City's capital assets can be found in Note 6 on pages 58 to 60 of this '
report.
Long-Term Debt '
At the end of the current year, the City had total bonded debt outstanding of$ 16,145,000. Of this
amount, $ 5,905,000 comprises debt backed by the full faith and credit of the government and ,
$ 10,240,000 is special assessment debt for which the government is liable in the event of default by the
property owners subject to the assessment.
Outstanding Debt '
G.O. and Revenue Bonds
Expressed in Thousands ,
Governmental Activities
2011 2010
G.O. Bonds 5 905 6 340 ,
$ , $ ,
Special Assessment Debt with ,
Governmental Commitment 10,240 12,370
Revenue Bonds - -
Total $ 16,145 $ 18,710 ,
The City's total bonded debt decreased by $ 2,565,000 during the current year. ,
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' CITY OF SHAKOPEE
MANAGEMENT'S DISCUSSION AND ANALYSIS
' December 31, 2011
Minnesota Statutes limit the amount of general obligation (G.O.) debt a government entity may issue to
, a net figure of 3% of the taxable market value. The current legal debt margin for the City is $ 107
million, which is significantly in excess of the City's outstanding G.O. debt.
� Additional information on the City's long-term debt can be found in Note 7 on pages 60 to 63 of this
report.
' ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS AND RATES
The unemployment rate for the state was 5.7% at year-end. This is a decrease from a rate of 7.0% a year
' ago.
Private firms added slightly over 36,000 jobs in 2011, primarily in health service business and
professional services. Inflationary trends in the region remain low in comparison to national indices.
' The City is continuing to benefit from the strong workforce and excellent transportation system of the
region. There are currently several business entities approaching the EDA and City Council for Tax
� Increment Financing and tax abatement proposals. These business ventures will bring not only a strong
base of varied jobs to the area but enhanced tax base for the recently developed commercial and
industrial sites.
! During the current year, the unassigned fund balance in the General Fund was $ 9,172,000. This can be
similarly compared to the unassigned fund balance of 2010 of$ 8,324,000. The City has maintained a
strong financial position, even with the decrease in the permit revenue source. The City Council and
' staff have planned for this reduction with a re-allocation of staff time and budget prioritization, to ensure
budget reflected the reduced resources.
' The tax levy for 2011/2012 is flat at $ 14,837,000. The tax rate increased from 34.6827 to 34.839, a .4%
increase. The General Fund budget for 2012 expenditures as originally adopted was $ 20,120,671
compared to $ 20,176,000 for 2011 and $ 19,768,000 for 2010. The 2011 budget reflected several
� departmental reclassifications which had little impact on the comparative budget. As in the past, the
public safety areas comprise the largest component of the budget with increased demands for police
services and the near completion of the newly constructed fire station. This station will replace the
1 1950's site that is out of service as of spring 2012.
Utility rates for the Electric and Water Enterprise Funds slightly increased in 2012 while the Sewer Fund
flow rate increased 3% with the flat fee decreasing 29% and the Storm Drainage Fund rate was
' decreased 15%. The infrastructure planning and development as well as coordination with capital
programs of the City and SPUC will determine the planned expenditures as well as the need for future
rate review and possible increases.
IREQUESTS FOR INFORMATION
� This financial report is designed to provide a general view of the City's finances for all those with an
interest in the City's finances. Questions concerning any of the information provided in this report or
requests for additional information should be addressed to the Finance Director, 129 Holmes St. S.,
, Shakopee, Minnesota, 55379.
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iBASIC FINANCIAL STATEMENTS
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CITY OF SHAKOPEE '
STATEMENT OF NET ASSETS
December 31,2011
Govemmental Business-Type '
Activities Activities Total Component Unit
ASSETS '
Cash and Investments(Induding Cash Equivalents) $ 41,260,929 $ 31,42Q901 $ 72,681,830 $ 23,077,827
Resficted Cash and Inveshnents - - - 7,010,708
Property Tax Receivable 260,248 - 260,248 -
Accounts Receivabie(Net of Allowance for
Uncollectible Accounts) 344,186 438,185 782,371 3,239,279 �
Interest Receivable 157,517 126,620 284,137 67,888
Due From Other Govemmenu 1,015,692 - 1,015,692 -
Special Assessments Receivable 5,326,943 140,637 5,467,580 -
Due from City of Shakopee - - - 112,405 �
Inventories - - 960,884
Prepaid Expenses 131,447 - 131,447 83,507
Notes Receivable 302,133 - 302,133 -
Unamortized Debt Issue Costs - - - 464,538 '
Electric Plant Acquisition(Net of Accumulated
Amortization) - - - 348,249
Long-Term SAC Credits - 1,307,159 1,307,159 -
Capital Assets,Net of Accumulated ,
Depreciaiton(Where Applicable):
Land and Land Improvements 19,488,040 3,944,380 23,432,420 -
Right of Way - 75,000 75,000 -
Construction in Progress 5,300,319 1,745,002 7,045,321 6,179
Line Rights - 915,810 915,810 - ,
Infrastructure 74,816,889 56,885,768 131,702,657 -
Plant in Service - - - 72,831,009
Buildings 24,230,203 - 24,230,203 -
MachineryandEquipment 7,291,504 1,514,110 8,805,614 - �
Total Assets $ 179,926,050 $ 98,513,572 $ 278,439,622 $ 108,202,473
LIABILITIES AND NET ASSETS �
Liabilities
Accounts and Contracts Payable $ 1,633,739 $ 92,963 $ 1,726,702 2,981,126
Other Current Liabilities - - - 184,825
Due to Other Govemments 325,734 - 325,734 - '
Due to City of Shakopee - - - 23,067
Salaries and Benefiu Payable 501,610 - 501,610 -
Deposits Payable - - - 1,218,502
Interest Payable 250,245 - 250,245 336,031
Uneamed Revenue - 1,307,159 1,307,159 1,231 �
Customer Advances - - - 3,9'72
Bond Principal Payable,Net:
Payable Within One Year 1,950,000 - 1,950,000 600,000
Payable After One Year 14,195,000 - 14,195,000 17,281,921 �
Compensated Absences Payable:
Payable Within One Year 766,754 31,136 797,890 -
Payabte After One Year 937,144 38,OS6 975,200 -
Net Other Post Employment Benefits(OPEB)Obligation 698,103 36,258 734,361 - ,
Total Liabilities 21,258,329 1,505,572 22,763,901 22,630,675
Net Assets
Invested in Capital Assets,Net of Relatcd Debt I 14,981,955 65,080,070 180,062,025 55,768,054 '
Restricted for:
Economic Development 497,775 - 497,775 -
Cable PEG Fees 45,681 - 45,681 -
Transit 1,237,762 - 1,237,762 -
Forfeiture 208,518 - 208,518 - �
Debt Service 8,924,703 - 8,924,703 -
Component Units - - - 5,354,275
Unrestricted 32,771,327 31,927,930 64,699,257 24,449,469
Total Net Assets 158,667,721 97,008,000 255,675,72] 85,571,798 '
Total Liabilities and Net Assets $ 179,926,050 $ 98,513,572 $ 278,439,622 $ 108,202,473
The Notes to the Financial Statements are an integral part of this statement. 24 ,
� � w � � ri � � � �r � r� � � r■� � � � �
CITY OF SHAKOPEE
STATEMENT OF ACTIVITIES
For the Year Ended December 31,2011
Net(Expense)Revenues
Program Revenues and Changes in Net Assets
Operating Capital Grants
Charges for Granu and and Govemmental Business-Type
Functions/Programs Expenses Services Contributions Contributions Activities Activities Total Component Units
Governmental Activities
General Government $ 4,252,887 $ 721,180 $ 769,585 $ - $ (2,762,122) $ - $ (2,762,122) $ -
Public Safery 9,236,767 1,503,188 408,981 - (7,324,598) - (7,324,598) -
Public Works 7,094,047 478,788 2,427,523 3,116,931 (1,070,805) - (1,070,805) -
EconomicDevclopment 244,361 7,I00 - - (237,261) - (237,261 -
Culture and Recreation 3,866,307 1,071,482 - 35,950 (2,758,875) - (2,758,875) -
[nterest on Long-Term Debt 619,099 - - - (619,099) - (619,099) -
Total Governmental Activities 25,313,468 3,781,738 3,606,089 3,152,881 (14,772,760) - (14,772,760)
Business-Type Activities
Sewer 3,807,322 2,941,753 - 18,810 - (846,759) (846,759) -
Storm Drainage 1,382,391 1,083,878 - 75,000 - (223,513) (223,513) -
Totai Business-Type Activities 5,189,713 4,025,631 - 93,810 - (1,070,272) (1,070,272) -
TotalPrimaryGovemment $ 30,503,181 $ 7,807,369 $ 3,606,089 $ 3,246,691 (14,772,760) (1,070,272) (15,843,032) -
Componeut Unit-SPUC
Electric $ 35,088,461 $ 37,577,570 $ - $ 166,213 - - - 2,655,322
Water 4,282,796 4,718,094 - 762,275 - - - 1,197,573
Total Component Unrt $ 39,371,257 $ 42,295,664 $ - $ 928,488 - - - 3,852,895
General Revenues
Property Taxes 14,487,805 - 14,487,805 -
Tax Increments ]60,884 - 160,884 -
Unrestricted[nvestment Eamings 1,032,409 758,182 1,790,591 170,905
Transfers 100,000 (100,000) - -
Total General Revenues and Transfers 15,781,098 658,182 16,439,280 17Q905
Change in Net Assets I,008,338 (412,090) 596,248 4,023,800
Net Assets-Beginning 157,659,383 178,968,088 336,627,471 -
Change in Accounting Principles - (81,547,998) (81,547,998) 81,547,998
Net Assets-Beginning,As Restated 157,659,383 97,420,090 255,079,473 81,547,998
Net Assets-Ending $ 158,667,721 $ 97,008,000 $ 255,675,721 $ 85,571,798
N The Notes to the Financial Statements are an integral part of this statement.
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CITY OF SHAKOPEE �
BALANCE SHEET-GOVERNMENTAL FL!NDS
December 31,2011
Debt Service Debt Service Capital Project '
2004A 2007A Other Total
Improvement Improvement Capital Govemmental Governmental '
General Fund Bonds Bonds Improvements Funds Funds
ASSETS
Cash and Investments $ 9,233,328 $ 441,727 $ 152,156 $ 6,486,430 $ 8,370,262 $ 24,683,903
Taxes Receivable-Delinquent 257,653 - - - 2,595 26Q248 �
Special Assessments Receivable:
Delinquent 7,237 - 10,509 1,010 5,669 24,425
Deferred 36,402 2,036,632 806,559 735,827 1,687,098 5,302,518
Accounts Receivable 276,455 - - - 67,731 344,I86 �
Interest Receivable 45,084 1,832 599 20,561 23,820 91,896
Due from Other Funds 266,489 - - - - 266,489
Due From Other Govemments 210,330 - 3,706 799,586 2,070 1,015,692
Notes Receivable - - - - 22,133 22,133
Prepaid Items 131,447 - - - - 131,447 '
Total Assets $ 10,464,425 $ 2,480,191 $ 973,529 $ 8,043,414 $ 10,181,378 $ 32,142,937
LIABILITIES AND FUND �
BALANCES
Liabilities
AccountsPayable $ 351,311 $ 374 $ 374 $ 42,329 $ 737,712 $ 1,132,100
Contracts Payable - - - - 286,747 286,747 '
Due to Other Funds - - - - 266,489 266,489
Due to Other Governments 6,019 - - 300,000 ]9,715 325,734
Salazies and Benefits Payable 501,610 - - - - 501,610
Deferred Revenue 301,291 2,036,632 817,068 736,838 1,695,362 5,587,191 �
TotalLiabilities 1,160,231 2,037,006 817,442 1,079,167 3,006,025 8,099,871
Fund Balances
Nonspendable 131,447 - - - - 131,447 '
Restricted - 443,185 156,087 - 7,246,214 7,845,486
Assigned - - - 6,964,247 413,228 7,377,475
Unassigned 9,172,747 - - - (484,089) 8,688,658
Total Fund Balances 9,304,194 443,185 156,087 6,964,247 7,175,353 24,043,066 ,
Total Liabilities and
FundBalances $ ]0,464,425 $ 2,48Q191 $ 973,529 $ 8,043,414 $ 10,181,378 $ 32,142,937
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The Notes to[he Financial Statements are an integral part of this statemenL 26 �
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� CITY OF SHAKOPEE
RECONCILIATION OF THE BALANCE SHEET TO
' THE STATEMENT OF NET ASSETS - GOVERNMENTAL FUNDS
December 31, 2011
' Total Fund Balances - Governmental Funds $ 24 043 066
, �
! Amounts reported for governmental activities in the Statement of Net Assets
are different because:
, Capital assets used in governmental activities are not current financial
resources and, therefore, are not reported as assets in governmental funds.
, Cost of Capital Assets 155,109,231
Less Accumulated Depreciation (57,335,112)
� Long-term liabilities, including bonds payable, are not due and payable in
the current period and, therefore, are not reported as liabilities in the funds.
Long-term liabilities at year-end consist of:
, Bond Principal Payable (16,145,000)
Net OPEB Obligation (698,103)
, Delinquent property taxes and assessments receivable will be collected this
year, but are not available soon enough to pay for the current period's
' expenditures and, therefore, are deferred in the funds.
Property Taxes 260,248
Special Assessments 24,425
' Deferred special assessments receivable are not available to pay for current
expenditures and, therefore, are deferred in the funds.
, Deferred Special Assessments 5,302,518
� Governmental funds do not report a liability for accrued interest
due and payable. (250,245)
, Internal service funds are used by management to charge the costs of
equipment, buildings, park assets and employee benefits to individual funds.
A portion of the assets and liabilities of those funds are included in
� governmental activities in the Statement of Net Assets. 48,356,693
Total Net Assets - Governmental Activities $ 158,667,721
�
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The Notes to the Financial Statements are an integral part of this statement. 27
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�
CITY OF SHAKOPEE �
STATEMENT OF REVENUES,EXPENDITURES AND
CHANGES IN FUND BALANCES-GOVERNMENTAL FUNDS
For the Year Ended Decembcr 31,2011 �
Debt Service Debt Service Capital Projects
2004A 2007A Other Total '
Improvement [mprovement Capital Govemmental Governmental
General Fund Bonds Bonds Improvements Funds Funds
REVENUES
Property Taxes $14,279,016 $ - $ - $ - $ 259,166 $ 14,538,182 �
Tax Increments - - - - 160,884 160,884
Special Assessments 21,905 224,992 148,667 326,689 753,071 1,475,324
Licenses and Permits 1,225,560 - - - 55,590 ],281,150
Intergovemmental 796,076 - - 799,184 2,346,570 3,941,830 �
Charges for Services 3,879,113 - - - 79,124 3,958,237
Fines and Forfeitures 357,249 - - - 53,962 411,21 I
Miscellaneous 397,477 9,240 2,860 130,768 165,624 705,969
Total Revenues 20,956,396 234,232 151,527 1,256,641 3,873,991 26,472,787 '
EXPENDITURES
Current
General Govemment 2,774,859 - - - 1,229,825 4,004,684 �
Public Safety 9,401,915 - - - 58,909 9,460,824
Public Works 2,602,104 - - - - 2,602,104
Culture and Recreation 3,856,869 - - - 45,517 3,902,386
Economic Development - - - - 247,591 247,591 '
Debt Service
Principal - 185,000 I10,000 - 2,270,000 2,565,000
Interest and Other Charges - 82,464 40,206 - 535,595 658,265 �
CapitalOutlay 39,191 - - 938,494 5,323,721 6,301,406
Total Expenditures 18,674,938 267,464 150,206 938,494 9,711,158 29,742,260
Excess of Revenues Over
(Under)Expenditures 2,281,458 (33,232) 1,321 318,147 (5,837,167) (3,269,473) �
OTHER FINANCING SOURCES
(USES) �
Transfers I❑ 122,400 - - 1,211,161 1,635,358 2,968,919
Transfers Out (2,137,394) - - (384,988) (228,448) (2,750,830)
Tota]Other Financing
Sources(Uses) (2,014,994) - - 826,173 1,406,910 218,089 �
Net Change in Fund
Balances 266,464 (33,232) 1,321 1,144,320 (4,430,257) (3,051,384)
FUND BALANCES �
Beginning of Year 9,037,730 476;417 154,766 5,819,927 I 1,605,610 27,094,450
End of Year $ 9,304,194 $ 443,185 $ 156,087 $ 6,964,247 $ 7,175,353 $24,043,066 '
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The Notes to the Financial Statements are an intcgral part of this statcment. 28 �
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� CITY OF SHAKOPEE
RECONCILIATION OF THE STATEMENT OF REVENUES,
� EXPENDITURES AND CHANGES IN FUND BALANCES TO
THE STATEMENT OF ACTNITIES - GOVERNMENTAL FUNDS
For the Year Ended December 31, 2011
�
� Net Change in Fund Balances - Governmental Funds $ (3,051,384)
Amounts reported for governmental activities in the Statement of Activities are
� different because:
Capital outlays are reported in governmental funds as expenditures. However, in the
' Statement of Activities, the cost of those assets is allocated over the estimated useful
lives as depreciation expense.
Capital Outlays 6,365,226
, Depreciation Expense (4,379,888)
Loss on Disposal of Fixed Assets (110,388)
, Contributed Assets 10,000
Principal payments on long-term debt are recognized as expenditures in the
� governmental funds but as an increase in the net assets in the Statement of Activiti 2,565,000
Interest on long-term debt in the Statement of Activities differs from the amount
� reported in the governmental funds because interest is recognized as an expenditure
in the funds when it is due and thus requires use of current financial resources.
In the Statement of Activities, however, interest expense is recognized as
' the interest accrues, regardless of when it is due. 39,166
Certain revenues in the Statement of Activities that do not provide current financial
' resources are not reported as revenues in the funds.
Special Assessments (728,951)
� OPEB obligations are recognized when paid in the government funds but recognized
when incurred in the Statement of Activities (147,605)
' Delinquent and deferred receivables will be collected this year, but are not
available soon enough to pay for the current period's expenditures and, therefore,
� are not revenues in the funds. (50,376)
Internal service funds are used by management to charge the costs of certain
� activities such as buildings, equipment, park assets and employee benefits to
individual funds. (See Note 2.B.) 497,538
� Change in Net Assets - Governmental Activities $ 1,008,338
� The Notes to the Financial Statements are an integral part of this statement. 29
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30 �
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� CITY OF SHAKOPEE
STATEMENT OF REVENUES,EXPENDITURES AND
� CHANGES IN FUND BALANCES-
BUDGET AND ACTUAL-GENERAL FUND
For the Year Ended December 31,2011
�
Variance with
� Original and Actual Final Budget-
Final Budget Amounts Over (Under)
REVENUES
� Property Taxes $ 13,383,820 $ 14,279,016 $ 895,196
Special Assessments 13,000 21,905 8,905
Licenses and Pernuts 1,246,750 1,225,560 (21,190)
� Intergovernmental 737,560 796,076 58,516
Charges for Services 3,547,010 3,879,113 332,103
Fines and Forfeitures 436,000 357,249 (78,751)
� Miscellaneous Revenues:
Investment Income 300,000 274,746 (25,254)
Contributions and Donations 3,000 4,944 1,944
� Rents 2,480 7,605 5,125
Other 37,800 110,182 72,382
Total Revenues 19,707,420 20,956,396 1,248,976
� EXPENDITURES
Current
General Government 3,254,700 2,774,859 (479,841)
� Public Safety 9,715,730 9,401,915 (313,815)
Public Works 2,808,660 2,602,104 (206,556)
Parks and Recreation 4,361,550 3,856,869 (504,681)
� CapitalOutlay
Public Works 35,000 27,477 (7,523)
Park and Recreation - 11,714 11,714
� Total Expenditures 20,175,640 18,674,938 (1,500,702)
Excess of Revenues Over
, (Under)Expenditures (468,220) 2,281,458 2,749,678
OTHER FINANCING SOURCES (USES)
, Transfers In 122,400 122,400 -
Transfers Out (2,137,394) (2,137,394)
Total Other Financing Sources
� (iJses) 122,400 (2,014,994) (2,137,394)
Net Change in Fund Balances $ (345,820) 266,464 $ 612,284
� FUND BALANCES
Beginning of Year 9,037,730
, End of Year $ 9,304,194
� The Notes to the Financial Statements are an integral part of this statement. 31
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� CITY OF SHAKOPEE
STATEMENT OF REVENUES,EXPENSES AND CHANGES
IN FUND NET ASSETS-PROPRIETARY FUNDS
� For the Year Ended December 3l,2011
� Business-Type Activities-Enterprise Funds
� Sewer Storm Drainage Total
OPERATING REVENUES
Charges for Services $ 2,936,144 $ 995,855 $ 3,931,999
� Rental and Other Charges - - -
Total Operating Revenues 2,936,144 995,855 3,931,999
OPERATING EXPENSES
� Salaries and Benefits 266,646 432,278 698,924
Depreciation 726,623 657,651 1,384,274
Professional Services 209,110 145,552 354,662
� Sewer Disposal Charges 2,478,713 - 2,478,713
Repairs and Maintenance 15,039 87,292 102,331
Materials and Supplies 19,311 37,130 56,441
Rent 30,904 43,074 73,978
� Insurance 7,551 7,739 15,290
Utilities 82,305 555 82,860
Total Operating Expenses 3,836,202 1,411,271 5,247,473
1 Operating Income(Loss) (900,058) (415,416) (1,315,474)
NONOPERATING REVENUES
� (EXPENSES)
Investment Income 400,781 357,401 758,182
Special Assessments 18,810 - 18,810
Loss on Sale of Asset - - -
� Other Income 5,609 88,023 93,632
Total Nonoperating Revenues
� (Expenses) 425,200 445,424 870,624
Income(Loss)before Capital
Contributions and Transfers (474,858) 30,008 (444,850)
� Capital Contributions - 75,000 75,000
1'ransfers In - - -
� Transfers Out (50,000) (50,000) (100,000)
Change in Net Assets (524,858) 55,008 (469,850)
� NET ASSETS
Beginning of Year 48,186,536 49,233,554 97,420,090
End of Year $ 47,661,678 $ 49,288,562 96,950,240
� Adjustment to Reflect the Consolidation of Internal Service
Fund Activity Related to Enterprise Funds(See Note 2) 57,760
� Change in Net Assets-Business-Type Activities $ 97,008,000
The Notes to the Financial Statements are an integral part of this statement.
�
�
CITY OF SHAKOPEE �
STATEMENT OF CASH FLOWS-PROPRIETARY FUNDS
For the Year Ended December 31,2011 �
Business-Type Activities-Enterprise Funds
Governmental �
Activities-
Storm Internal
Sewer Drainage Total Service Funds �
)PERATING ACTIVITIES
Customers and Users $ 3,085,323 $ l,072,088 $ 4,157,411 $ 2,329,169
ippliers (2,918,060) (322,316) (3,240,376) (161,921)
nployees (264,527) (423,509) (688,036) (88,751) �
let Cash Flows-Operating
Activities (97,264) 326,263 228,999 2,078,497
VONCAPITAL �
'TIVITIES
�ther Funds - - - 471,911
ier Funds (50,000) (50,000) (100,000) (590,000) �
let Cash Flows-Noncapital
Financing Activities (50,000) (50,000) (100,000) (118,089)
�APITAL AND RELATED �
"TIVITIES
5,609 88,023 93,632 -
i Special Assessments 25,849 - 25,849 - �
ntal Capital Grant - - - 46,501
Disposal of Capital Assets - - - 26 431
,
Capital Assets (643,429) (1,525,440) (2,168,869) (366,014) �
Tet Cash Flows-Capital and
Related Financing Activities (611,971) (1,437,417) (2,049,388) (293,082)
[NVESTING ACTIVITIES �
ived for Notes Receivable - - - 85,000
vidends Received 415,891 383,149 799,040 470,765
det Cash Flows-Investing '
Activities 415,891 383,149 799,040 555,765
sh and Cash Equivalents (343,344) (778,005) (1,121,349) 2,223,091
H EQUIVALENTS t
� 16,311,730 16,172,760 32,484,490 14,411,695
$ 15,968,386 $ 15,394,755 $ 31,363,141 $ 16,634,786 �
�
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nancial Statements are an integral part of this statement. 34 �
1
�� CITY OF SHAKOPEE
STATEMENT OF CASH FLOWS-PROPRIETARY FUNDS
� For the Year Ended December 31,2011
(Continued)
� Business-Type Activities-Enterprise Funds
Governmental
Activities-
� Storm Interna]
Sewer Drainage Total Service Funds
RECONCILIATION OF OPERATING
INCOME(LOSS)TO NET CASH FLOWS-
� OPERATING ACTIVITIES
Operating Income(Loss) $ (900,058) $ (415,416) $ (1,315,474) $ 161,020
Adjustments to Reconci]e Operating
� Income(Loss)to Net Cash Flows-
Operating Activities:
Miscellaneous Operating Revenue - - _ _
Depreciation and Amortization Expense 726,623 657,651 1,384,274 1,738,948
� Change in Assets and Liabilities:
Accounts Receivable,Net 149,179 76,776 225,955 900
Specia]Assessments Receivable - (543) (543) -
� Due to Other Governments (55,882) (18,627) (74,509) -
Accounts Payable (]9,245) 17,236 (2,009) 143,501
Contracts Payable - 417 417 -
Compensated Absences Payable (1,707) 4,943 3,236 34,128
� Net OPEB Obligation 3,826 3,826 7,652 -
Total Adjustments 802,794 741,679 1,544,473 1,917,477
Net Cash Flows-
� Operating Activities $ (97,264) $ 326,263 $ 228,999 $ 2,078,497
NONCASH INVESTING,CAPITAL AND
FINANCING ACTIVITIES
Recognition of Sewer Access Capacity
Credits as Asset and Unearned Revenue $ 1,307,159 $ - $ 1,307,]59 $ -
Contribution of Capital Asset - 75,000 75,000 -
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� The Notes to the Financial Statements are an integral part of this statement. 35
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CITY OF SHAKOPEE ��
COMBINED STATEMENT OF FIDUCIARY NET ASSETS
December 31, 2011 �
Total Agency ,
Funds
ASSETS �
Cash and Investments $ 2,279,407
Receivables:
Accounts Receivable 9,379 '
Interest Receivable 2,790
Due from Other Governments 39,128
Total Assets $ 2,330,704 �
LIABILITIES �
Accounts Payable $ 683,055
Deposits Payable 1,647,649 �
Total Liabilities $ 2,330,704
�
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The Notes to the Financial Statements are an integral part of this statement. 40 �
�
� CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
� December 31, 2011
� NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
� The City of Shakopee is a statutory city governed by an elected mayor and four council members. The
accompanying financial statements present the government entities for which the government is
considered to be financially accountable.
� The financial statements present the City and its component units. The City includes all funds,
organizations, institutions, agencies, departments and offices that are not legally separate from such.
�� Component units are legally separate arganizations for which the elected officials of the City are
financially accountable and are included within the financial statements of the City because of the
significance of their operational or financial relationships with the City.
� The City is considered financially accountable for a component unit if it appoints a voting majority of
the organization's governing body and it is able to impose its will on the organization by significantly
� influencing the programs, projects, activities or level of services performed or provided by the
organization or there is a potential for the organization to provide specific financial benefits to or impose
specific financial burdens on, the City.
� As a result of applying the component unit definition criteria above, certain organizations have been
defined and are presented in this report as follows:
� Blended Component Unit—Reported as if they were part of the City.
Discretely Presented Component Unit—Entails reporting the component unit financial data in
� statements separate from the financial date of the City.
Joint Ventures and Jointly Governed Organizations—The relationship of the City with the entity is
� disclosed.
For each of the categories above, the specific entities are identified as follows:
� 1. Blended Component Unit
The Shakopee Economic Development Authority (EDA) was organized to promote development,
� improve housing and reduce blighted areas in the City. It is included by reason of the City Council
having final approval for Shakopee EDA actions and the Shakopee EDA Board being comprised
entirely of City Council Members. City staff handles Shakopee EDA activity including Shakopee
� EDA funds and the City approves Shakopee EDA tax levies and bonding activity. Therefore, the
City has financial oversight for Shakopee EDA activities.
� The activity of the Shakopee EDA is shown in the Shakopee EDA Special Revenue Fund in the
City's financial statements. No separate financial statements for the Shakopee EDA are issued. For
any information desired beyond what is presented in this report, contact the Finance Director for the
� City of Shakopee at 129 Holmes Street South, Shakopee, Minnesota 55379-1351.
� 41
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CITY OF SHAKOPEE �
NOTES TO THE FINANCIAL STATEMENTS
December 31, 20ll �
NOTE 1 —SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Re ortin Enti Continued �
P g tY � )
2. Discretely Presented Component Unit �
The electric and water utilities of the Shakopee Public Utilities Commission (SPUC) are self-
supporting entities and collectively comprise separate enterprise funds of the City of Shakopee (the �
"City"). The utility provides electric and water operations to properties within the City as well as
electric distribution to certain other areas outside of the City. The utility accounts for the costs of
electric and water operations on a continuing basis and is managed by the SPUC. The SPUC Board �
consists of five members who serve three year consecutive terms. Separate financial statements are
included in this report for the SPUC Funds to emphasize that it is legally separate from the City. The
water and electric funds are presented as enterprise funds. The complete financial statements can be �
obtained from the Shakopee Public Utility Commission, 225 Sarazin Street, Shakopee, Minnesota
55379.
3. Joint Ventures and Jointly Governed Organizations �
Local Government Information Systems
Local Government Information Systems (LOGIS) is a joint venture of approximately 44 �
governmental entities that provides computerized data processing and support services to its
members. Legally separate, the City does not appoint a voting majority of the Board and LOGIS is �
fiscally independent of the City. During 2011, the City paid $ 120,508 to LOGIS for services
provided which is included in expenditures of the General Fund. Financial statements are available
by contacting LOGIS, 5750 Duluth Street, Golden Valley, Minnesota 55422-4036. �
Scott Joint Prosecution Association
Scott Joint Prosecution Association (SJPA) is a joint venture of approximately seven cities that �
provides legal prosecution and support services to its members. Legally separate, the City does not
appoint a voting majority of the Board of Directors and the SJPA is fiscally independent of the City. �
During 2011, the City paid $ 399,922 to the SJPA for services provided which is included in
expenditures of the General Fund. Financial statements are available by contacting the SJPA, 200
Fourth Avenue West, Shakopee, Minnesota 55379.
�
�
�
�
42 �
i
( CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
IDecember 31, 2011
NOTE 1 —SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
IA. Reporting Entity (Continued)
I4. Other Organizations
Shakopee Volunteer Fire Department Relief Association
� The Shakopee Volunteer Fire Department Relief Association (the "Association") is organized as a
nonprofit organization, legally separate from the City, by its members to provide pensions and other
' benefits to such members in accordance with Minnesota Statutes. It is not a component unit of the City
because the Board of Directors is appointed by the membership of the Association and not by the City
Council. The financial oversight of the City is limited to approval authority for amending the
' Association bylaws when the change results in an increase in the pension benefit level requiring an
increased City contribution. The Association has the authority to levy its own taxes for pensions and
deficits and would continue to exist for its members if the City was dissolved. Because the Association
is fiscally independent of the City, the financial statements of the Association have not been included
' within the City's reporting entity.
B. Government-Wide and Fund Financial Statements
� The government-wide financial statements (i.e., the Statement of Net Assets and the Statement of
Activities) report information on all of the nonfiduciary activities of the City. The fiduciary funds are
' only reported in the Statement of Fiduciary Net Assets at the fund financial statement level.
Governmental activities, which normally are supported by taxes and intergovernmental revenues, are
reported separately from business-type activities, which rely to a significant extent on fees and charges
' for support.
The Statement of Activities demonstrates the degree to which the direct expenses of a given function or
' segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a
specific function or segment. Interest on general long-term debt is considered an indirect expense and
is reported separately in the Statement of Activities. Program revenues include 1) charges to customers
' or applicants who purchase, use or directly benefit from goods, services or privileges provided by a
given function or segment and 2) grants and contributions that are restricted to meeting the operational
or capital requirements of a particular function or segment. Taxes and other items not properly
included among program revenues are reported instead as general revenues. Internally dedicated
, revenues are reported as general revenues rather than program revenues.
Separate financial statements are provided for governmental funds and proprietary funds. Major
' individual governmental funds and major individual enterprise funds are reported as separate columns in
the fund financial statements.
� The Escrow Agency Fund is presented in the fiduciary fund financial statements. Since, by definition,
these assets are being held for the benefit of a third party (other local governments, private parties, etc.)
and cannot be used to address activities or obligations of the City, this Fund is not incorporated into the
� government-wide statements.
' 43
I
CITY OF SHAKOPEE '
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2011 '
NOTE 1 —SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES '
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources measurement focus '
and the accrual basis of accounting, as are the proprietary fund financial statements. Revenues are
recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of
related cash flows. Property taxes are recognized as revenues in the year for which they are levied. '
Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the
provider have been met.
The Agency Funds report only assets and liabilities and have no measurement focus, but do use the '
accrual basis of accounting to recognize receivables and payables.
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 revenues to be available if they are collected within 60 days of the end of the current
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, franchise taxes, licenses and interest associated with the current period are all
considered to be susceptible to accrual and so have been recognized as revenues of the current period. ,
Only the portion of special assessments receivable due within the current 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. '
Description of Funds:
Major Governmental Funds: '
General Fund—This Fund is the City's primary operating fund. It accounts for all financial resources
of the general City, except those required to be accounted for in another fund. �
2004A Improvement Bonds Debt Service Fund—This Fund accounts for resources accumulated and
payments made for principal and interest on this bond issue. �
2007A Improvement Bonds Debt Service Fund— This Fund accounts for resources accumulated and
payments made for principal and interest on this bond issue. ,
Capital Improvements Capital Project Fund —This Fund accounts for the capital projects of the City
not accounted for in separate capital funds.
Proprietary Funds: �
Sewer Fund—This Fund accounts for operations of the City's sewer utility. '
Storm Drainage Fund —This Fund accounts for the activities of the City's storm drainage utility.
44 '
�
' CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
' December 31, 2011
' NOTE 1 —SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation (Continued)
' Description of Funds: (Continued)
Internal Service Funds:
� Equipment Fund—This Fund accounts for the City's acquisition of larger pieces of equipment.
' Building Fund—This Fund accounts for the City's funds accumulated for construction, improvement
or major repairs of major public buildings.
' Park Assets Fund—This Fund accounts for the City's funds accumulated for the replacement of park
assets.
' Employee Benefits Fund—This Fund accounts for the City's funds accumulated for compensated
absences and OPEB.
Information Technology—This Fund accounts for the City's funds accumulated for information
, technology resources.
The City's internal service funds are allocated between governmental and business-type activities and
' are combined, as allocated in Note 2, with the respective governmental activities and business-type
activities in the government-wide financial statements.
' Fiduciary Funds:
Escrow Agency Fund—This Fund accounts for the monies held for specific purposes for individuals,
' private organizations, other government units and other funds. Escrows are held on behalf of
builders and developers, for security deposits and police evidence deposits.
� Southwest Metro Drug Task Force Agency Fund—This Fund accounts for the activity related to the
task force held by the City in a strictly custodial capacity.
Component Unit Funds:
, Electric Fund—This Fund accounts for the operations of the SPUC's electric utility.
' Water Fund—This Fund accounts for the operations of the SPUC's water utility.
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 GASB. 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.
' 45
�
CITY OF SHAKOPEE '
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2011 ,
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES '
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation (Continued)
As a general rule, the effect of interfund activity has been eliminated from the government-wide ,
financial statements. Exceptions to this general rule are payments, where the amounts are reasonably
equivalent in value to the interfund services provided and other charges between the City's utility
function and various other functions of the City. Elimination of these charges would distort the direct ,
costs and program revenues reported for the various functions concerned.
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 enterprise funds are charges to customers for sales and services. Operating expenses for enterprise '
funds include the cost of sales and services, administrative expenses and depreciation on capital assets.
All revenues and expenses not meeting this definition are reported as nonoperating revenues and
expenses. ,
When both restricted and unrestricted resources are available for use, it is the City's policy to use
restricted resources first, then unrestricted resources as they are needed. '
D. Assets, Liabilities and Net Assets or Equity
1. Deposits and Investments '
The City's cash and cash equivalents are considered to be cash on hand, demand deposits and highly
liquid debt instruments purchased with original maturities of three months or less from the date of '
acquisition. Investments are stated at fair value.
Minnesota Statutes authorizes the City to invest in obligations of the U.S. Treasury, agencies and �
instrumentalities, shares of investment companies whose only investments are in the aforementioned
securities, obligations of the State of Minnesota or its municipalities, bankers' acceptances, future
contracts, repurchase and reverse repurchase agreements and commercial paper of the highest quality �
with a maturity of no longer than 270 days and in the Minnesota Municipal Money Market Fund.
The Minnesota Municipal Money Market Fund is an external investment pool not registered with the �
Securities Exchange Commission (SEC) that follows the same regulatory rules of the SEC under
Rule 2.a.7. The fair value of the position in the pool is the same as the value of the pool shares.
The City's investment policy for all funds except the component units addresses custodial credit risk '
for deposits. The policy also addresses credit risk, interest rate risk, concentration of credit risk and
custodial credit risk for investments. The City's component units also have a formal policy to
address all of these risks except custodial credit risk for investments. �
'
46 '
'
� CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
' December 31, 2011
, NOTE 1 —SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
D. Assets, Liabilities and Net Assets or Equity (Continued)
' 1. Deposits and Investments (Continued)
Custodial Credit Risk—Deposits: This is the risk that in the event of a bank failure, the City's
� deposits may not be returned to it. Minnesota Statutes require all deposits be protected by federal
deposit insurance, corporate surety bonds or collateral. The market value of collateral pledged must
equal 110% of deposits not covered by Federal Deposit Insurance Corporation (FDIC) insurance or
� corporate surety bonds and letters of credit. The City and component unit's investment policies state
deposits must be collateralized in order to comply with Minnesota Statutes.
' Credit Risk: This is the risk that an issuer or other counterparty to an investment will not fulfill its
obligation to the holder of the investment. Minnesota Statutes 118A.04 and 188A.05 limit
investments that are in the top two ratings issued by nationally recognized statistical rating
' arganizations. The City's investment policy references Minnesota Statutes and further limits the
types of investments that the City is allowed to invest in. The component unit's investment policy
also defines suitable and authorized investments and related minimum ratings.
' Interest Rate Risk: This is the risk that changes in market interest rates will adversely affect the fair
value of an investment. The City's policy states the investment portfolio shall be designed with the
objective of attaining a market rate of return throughout budgetary and economic cycles, taking into
' account the investment risk constraints and liquidity needs. To the extent possible, the City shall
attempt to match its investments in short-term operating funds with anticipated cash flow
requirements. Unless matched to a specific cash flow, the City will not directly invest in securities
' maturing more than ten years from the date of purchase. Long-term funds shall not be invested in
securities exceeding 10 years in modified duration, at time of purchase. The investment policy for
the City's Electric and Water Enterprise Funds (Shakopee Public Utilities Commission) addresses
, this risk by requiring holding of securities to maturity (subject to certain exceptions) and limiting
maturity constraints to a relatively short duration.
� Concentration of Credit Risk: This is the risk of loss attributed to the magnitude of an investment in
a single issuer. According to the City's investment policy, the aggregate investment portfolio shall
be diversified by:
� • Limiting investments to avoid over concentration in securities from a specific issuer or
business sector.
' • Limiting investments in securities that have higher credit risks.
• Investing in securities with varying maturities.
• Continuously investing a portion of the portfolio in readily available funds, such as Local
Government Investment Pools (LGIP), money market funds or repurchase agreements to
� ensure appropriate liquidity is maintained in order to meet ongoing obligations.
,
' 47
'
CITY OF SHAKOPEE �
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2011 '
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES '
D. Assets, Liabilities and Net Assets or Equity (Continued)
1. Deposits and Investments (Continued) �
• Having all investments, other than those in direct obligations or agencies of the United States,
secured by collateral or repurchase agreements, shall not exceed 50% of the aggregate '
investment portfolio. Mortgage backed securities shall not exceed 35% of the aggregate
investment portfolio, at the time of investment (i.e., commercial paper or bankers'
acceptance). �
• Limiting investments in any one corporation to 5% of the aggregate investment portfolio.
The investment policy for the City's Electric and Water Enterprise Funds (Shakopee Public Utilities '
Commission) defines suitable and authorized investments and related minimum ratings as well as
application of prudent person standards in construction of portfolio management and diversification.
Custodial Credit Risk—Investments: For an investment, this is the risk that in the event of the '
failure of the counterparty, the City will 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 states �
all securities purchased, including appropriate collateral, shall be placed with an independent third
party for custodial safekeeping.
2. Receivables and Payables '
Activity between funds that are representative of lending/borrowing arrangements outstanding at the
end of the year are referred to as "advances to/from other funds". All other outstanding balances ,
between funds are reported as "due to/from other funds". Any residual balances outstanding between
the governmental activities and business-type activities are reported in the government-wide
financial statements as "interfund balances". '
All trade and property tax receivables are shown at a gross amount since both are assessable to the
property taxes and are collectible upon the sale of the property. '
The City levies its property tax for the subsequent year during the month of December. December 28
is the last day the City can certify a tax levy to the County Auditor for collection the following year. �
Such taxes become a lien on January 1 and are recorded as receivables by the City at that date. The
property tax is recorded as revenue when it becomes measurable and available. Scott County is the
collecting agency for the levy and remits the collections to the City three times a year. The tax levy
notice is mailed in March with the first half of the payment due on May 15 and the second half due '
on October 15. Taxes not collected as of December 31 each year are shown as delinquent taxes
receivable.
The County Auditor prepares the tax list for all taxable property in the City, applying the applicable �
tax rate to the tax capacity of individual properties, to arrive at the actual tax for each property. The
County Auditor also collects all special assessments, except for certain prepayments paid directly to �
the City.
48 '
�
tCITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
' December 31, 2011
' NOTE 1 —SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
D. Assets, Liabilities and Net Assets or Equity (Continued)
� 2. Receivables and Payables (Continued)
The County Auditor submits the list of taxes and special assessments to be collected on each parcel
� of property to the County Treasurer in January of each year.
3. Inventory, Prepaid Items and Other Assets
, Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as
prepaid items in both government-wide and fund financial staternents. Other assets include
� unamortized debt issuance costs for the Electric and Water Enterprise Funds (Shakopee Public
Utilities Commission).
� Inventories of enterprise funds are valued at average cost using the first in, first out (FIFO) method.
Inventory in the governmental funds is recorded as an expenditure when consumed rather than when
purchased.
' 4. Restricted Assets
Certain cash and investments in the component units are classified as restricted. The Electric Fund
� has monies restricted for customer deposits and debt service. The Water Fund has monies restricted
for water production and trunk distribution facility acquisition, based on trunk and connection fees
collected from users, construction projects and debt service.
' S. Capital Assets
� Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads,
sidewalks and similar items), are reported in the applicable governmental or business-type activities
columns in the government-wide financial statements. Capital assets are defined by the City,
� excluding the component unit, as assets with an initial, individual cost of more than $ 10,000 and an
estimated useful life in excess of two year. Capital assets for the component unit are defined as
assets with an initial, individual cost of mare than $ 1,000 and an estimated useful life in excess of
one year. Such assets are recorded at historical cost or estimated historical cost if purchased or
' constructed. Donated capital assets are recorded at estimated fair market value at the date of
donation.
� 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.
�
'
� 49
�
CITY OF SHAKOPEE '
NOTES TO THE FINANCIAL STATEMENTS
December 31,2011 �
NOTE 1 —SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ,
D. Assets, Liabilities and Net Assets or Equity (Continued)
5. Capital Assets (Continued) '
Property, plant and equipment of the City are depreciated using the straight-line method over the
following estimated useful lives. �
Assets Years
Buildings 30-50 '
Park Buildings 30
Building Improvements 25 �
Light Vehicles 4-10
Machinery and Equipment 4-20
Utility Distribution System 50-75 �
Infrastructure 30-50
Fire Trucks 20-25 �
6. Compensated Absences
Vacation and sick leave benefits are recorded as expenditures in the Employee Benefits Internal '
Service Fund and governmental funds when the obligations have matured and are expected to be
liquidated with expendable financial resources. City employees earn vacation time based on years
of City service. Employees who have Q to 15 years of employment may accumulate no more than '
240 hours. Employees who have 16 or more years of service may accumulate no more than 360
hours of vacation leave. Upon termination, employees will receive compensation for all unused
vacation. Employees earn sick leave and may accumulate to a maximum of 960 hours. The City �
compensates employees who leave municipal service at the rate of 45% up to 15 years of service.
After 15 years of service, employees who leave are compensated at the rate of 55% plus 2% for each
year of service beyond 15 years up to 75% of unused sick leave. �
7. 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. �
Enterprise fund bond premiums and discounts, as well as issuance costs, are deferred and amortized
over the life of the bonds using the effective interest method. Bonds payable are reporied 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.
'
50 �
,
' CITY OF SHAKOPEE
NOTES TQ THF. FTNANCIAL STATEMENTS
, December 31, 2011
' NOTE 1 —SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
D. Assets, Liabilities and Net Assets or Equity (Continued)
' 7. Long-Term Obligations (Continued)
In the fund financial statements, governmental fund types recognize bond premiums and discounts,
' as well as bond issuance costs, during the current period. The face amount of debt issued is reported
as other financing sources. Premiums received on debt issuances are reported as other financing
sources while discounts on debt issuances are reported as other financing uses. Issuance costs,
' whether or not withheld from the actual debt proceeds received, are reported as expenditures.
8. Fund Equity
' a. Classification
' In the fund financial statements, governmental funds report fund classifications that comprise a
hierarchy based primarily on the extent to which the City is bond to honor constraints on the
specific purpose for which amounts in those funds can be spent. Non-spendable fund balances
' include amounts that cannot be spent because they are not in spendable form. Amounts that are
restricted to specific purposes either by a) constraints placed on the use of resources by creditors,
grantors, contributors, or laws or regulations of other governments or b) imposed by law through
, enabling legislation are classified as restricted fund balances. Amounts that can only be used for
specific purposes pursuant to constraints imposed by the City Council (highest level of decision
making authority) through resolution are classified as committed fund balances. Amounts that
are constrained by the City's intent to be used for specific purposes but are neither restricted nor
' committed are classified as assigned fund balances. Assignments are made by the City's Finance
Director based on the City Council's direction. Unassigned fund balance represents fund balance
that has not been assigned to other funds and that has not been restricted, committed or assigned
' to a specific purpose in the General Fund. The City's policy is to consider unrestricted fund
balance to be spent by City Council action, appropriations or emergency situations.
' The City applies restricted resources first when expenditures are incurred for purposes for which
either restricted or unrestricted (committed, assigned, and unassigned) are available. Similarly,
within unrestricted fund balance, committed amounts are reduced first followed by assigned and
' then unassigned amoutits when expenditures are incurred for purposes for which amounts in any
of the unrestricted fund balance classifications could be used.
' b. Minimum Fund Balance
The City's target General Fund balance is to maintain an unassigned level between 40%
' (minimum) and 45% of current year expenditures. This level is to provide working capital for
cash flow, expected decline in revenues and unforeseen expenditures such as natural disasters.
Replenishing fi:nd balance when it falls below the target level shall be accoinplished by interfund
transfers or budgeting for expenditures and other uses to be less than revenues or other sources
' over a period not to exceed three years.
' S1
'
CITY OF SHAKOPEE '
NOTES TO THE FINANCIAL STATEMENTS
December 31, 20ll '
NOTE 1 —SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES '
D. Assets, Liabilities and Net Assets or Equity (Continued)
9. Net Assets '
Net assets represent the difference between assets and liabilities in the government-wide 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 in the government-wide financial
statement when there are limitations on their use through external restrictions imposed by creditors, t
grantors or laws or regulations of other governments.
10. Use of Estimates '
The preparation of financial statements in conformity with U.S. generally accepted accounting
principles requires management to make estimates and assumptions that affect the reported amounts t
of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statements. Estimates also affect the reported amounts of revenue and expenditures/expense during
the reporting period. Actual results could differ from those estimates. '
NOTE 2 —RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL
STATEMENTS
A. Ex lanation of Certain Differences between the Governmental Fund Balance Sheet and the '
P
Government-Wide Statement of Net Assets
The governmental fund Balance Sheet includes 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"Internal Service Funds are �
used by management to charge the costs of providing certain services for the City."
Net Assets of the Internal Service Funds $ 48,414,453 '
Less Portion of of Gain Related to Business-Type Activities (57,760)
Net Adjustment to Increase Fund Balance -Total Governmental '
Funds to Arrive at Net Assets - Governmental Activities $ 48,356,693
'
,
'
52 '
'
' CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
' December 31, 2011
' NOTE 2—RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL
STATEMENTS
B. Explanation of Certain Differences between the Governmental Fund Statements of
' Revenues, Expenditures, and Changes in Fund Balances and the Government-Wide
Statement of Activities
' Another element of that reconciliation states that"Internal Service Funds are used by management to
charge the costs of providing various services for the City." The details of this difference are as follows:
� Change mNet Assets ofthe Internal Service Fund $ 555,298
Less the Net of Indffect Revenues and F,�cpense (57,760)
' Net Adjustment to Decrease Net Change in Fund Balances- Total
Governmental Funds to An-ive at Changes in Net Assets of
' Govemmental Activiries $ 497,538
C. Explanation of Certain Differences between the Proprietary Fund Statements of Net
' Assets and the Government-Wide Statement of Net Assets
The proprietary fund Statement of Net Assets includes reconciliation between net assets—total
' enterprise funds and net assets of business-type activities as reported in the government-wide Statement
of Net Assets. The description of the sole reconciliation is "adjustment to reflect the consolidation of
internal service fund activities related to enterprise funds." The details of this $ 57,760 are as follows:
' Internal Payable Representing Costs less than Charges to
Business-Type Activities-Current Year $ 57,760
, D. Explanation of Certain Differences between the Proprietary Fund Statements of
Revenues, Expenses, and Changes in Fund Net Assets and the Government-Wide
' Statement of Activities
Net Adjustment to Increase Net Change in Fund Balances - Total
, Enterprise Funds to Arrive at Changes in Net Assets of
Business-Type Activities $ 57,760
'
'
'
' S3
'
CITY OF SHAKOPEE '
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2011 '
NOTE 3— STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY '
A. Budgetary Information
Budgets are adopted on a basis consistent with U.S. generally accepted accounting principles. Annually '
appropriated budgets are adopted for the General Fund and the Shakopee EDA and Transit Special Revenue
Funds.
Budgeted amounts present the originally adopted budget and final amended budget approved by the City ,
Council. The City does not use encumbrances. Budgeted expenditure appropriations lapse at year-end.
1. In August of each year, City staff submits to the City Council, a proposed operating budget for �
the year commencing the following January 1. The operating budget includes proposed
expenditures and the means ot financing them for the upcoming year. '
2. Public hearings are conducted to obtain taxpayer comments.
3. The budget is legally enacted through passage of a resolution after obtaining taxpayer comments. '
4. Expenditures may not legally exceed budgeted appropriations at the division level. No fund's '
budget can be increased without City Council approval. The City Council may authorize transfer
of budgeted amounts between divisions within any fund. Management may amend budgets
within a division level, so long as the total division budget is not changed.
5. Annual budgets are adopted for the General and applicable Special Revenue Funds. Annual '
appropriated budgets are not adopted for Debt Service Funds because effective budgetary control
is alternatively achieved through bond indenture provisions. Budgetary control for Capital '
Projects Funds is accomplished through the use of project controls and budgets are not adopted.
5. Budgeted amounts are as originally adopted or as amended by the City Council. Individual '
amendments were not material in relation to the original amounts budgeted, except for transfers
in the General, Telecommunication and Recreation Funds.
NOTE 4—DEPOSITS AND INVESTMENTS '
A. Deposits
In accordance with applicable Minnesota Statutes, the City and the Component Unit maintains deposits �
at depository banks authorized by the City Council and the Commissioners.
Custodial Credit Risk: As of December 31, 2011, the City and Commission's bank balances were not ,
exposed to custodial credit risk because they were insured through Federal Deposit Insurance
Corporation (FDIC) and properly collateralized with securities held by the pledging financial �
institutions' trust departments or agents in the Entiry's name.
'
54 '
�
� CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
, December 31, 2011
� NOTE 4—DEPOSITS AND INVESTMENTS
A. Deposits (Contmued)
� As of December 31, 2011, the City had the following deposits:
City Deposits $ 1,013,884
, Component Unit Deposits 10,770,709
Total Deposits $ 11,784,593
� B. Investments
� As of December 31, 2011, the City held the following investments:
Modified
Fair Duration Moody's
� Value (Years) Rating Concentration
� 4M $ 4,483 N/A Aaa 0.01%
4M Plus 998 N/A Aaa < 0.01%
Agency Bonds:
, FFCB 2,601,914 4.15 Aaa 3.52%
FHLB 3,390,694 2.4 Aaa 4.58%
FHLMC 502,330 4.88 Aaa 0.68%
� FNMA 1,810,188 2.22 Aaa 2.45%
Agency Step-Up Bonds:
FHLB 3,003,300 5.9 Aaa 4.06%
' FHLMC 2,000,820 7.96 Aaa 2.71%
FNMA 2,002,040 13.84 Aaa 2.71%
Certificate of Deposit 3,205,088 1.98 NR 4.33%
, Commercial Paper 4,240,640 0.3 P-1 5.73%
Money Market Fund 9,415,672 N/A NR 12.73%
Mortgage Securities:
� CMO 725,046 6.87 Aaa 0.98%
FHLMC 3,466,698 8.87 Aaa 4.69%
FNMA 1,809,255 5.92 Aaa 2.45%
� GNMA 88,916 2.44 Aaa 0.12%
Municipal Bond 12,166,289 3.44 Aa2-Baa2 16.45%
U.S. Treasury Notes 23,511,622 1.57 Aaa 31.80%
' TotalInvestments $ 73,945,993 4.06
'
� 55
�
CITY OF SHAKOPEE '
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2011 '
NOTE 4 —DEPOSITS AND INVESTMENTS �
B. Investments (Continued)
As of December 31, 2011, the component units had the following investments: �
Years to Maturity
Less than '
Rating Fair Value One Year 1-5 Years
U.S. Agencies AAA $ 9,386,778 $ 7,174,719 $ 2,212,059 �
U.S. Treasuries AAA 8,111,901 3,314,989 4,796,912
Money Market Fund N/A 1,817,447 1,817,447 -
Total $ 19,316,126 $ 12,307,155 $ 7,008,971 '
Custodial Credit Risk— Investments: As of December 31, 2011, all investments of the City and the �
component units were insured, registered and held by the City or its agent and in the City's name, or by
the SPUC and in the SPUC's name.
Concentration of Credit Risk: As of December 31, 2011, the City held investments that exceeded 5% of �
its total investments for all funds as noted in the table on the previous page.
The component units' investments in FHLB, FNMA and FHLMC also exceeded 5% of the total �
investments of those funds at December 31, 2011.
The following is a summary of total deposits and investments as of December 31, 2011: �
Deposits (Note 3.A.) $ 11,784,593
City Investments 73,945,993 '
Component Unit Investments 19,316,126
Petty Cash 3,060
Total Deposits and Investments $ 105,049,772 '
�
�
'
,
56 ,
,
' CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
, December 31, 2011
' NOTE 4—DEPOSITS AND INVESTMENTS
B. Investments (Continued)
' Deposits and investments are presented in the December 31, 2011 basic financial statements as follows:
City Component
� Funds Units Total
Statement of Net Assets:
Cash and Investments $ 72,681,830 $ 23,077,827 $ 95,759,657
� Restricted Assets - 7,010,708 7,010,708
Statement of Fiduciary Net Assets:
Cash and Investments 2,279,407 - 2,279,407
� Total $ 74,961,237 $ 30,088,535 $ 105,049,772
NOTE 5—RECEIVABLES/DEFERRED REVENUE
� A. Taxes and Assessments
' Governmental funds report deferred revenue in connection with receivables for revenues that are not
considered to be available to liquidate liabilities of the current period. Governmental funds also defer
revenue recognition in connection with resources that have been received, but not yet earned. At the end
' of the current year, the various components of deferred revenue reported in the governmental funds were
as follows:
Delinquent Delinquent Deferred
� Property Special Special
Taxes Assessments Assessments Total
� General Fund $ 257,653 $ 7,237 $ 36,402 $ 301,292
2004A Improvement Bonds - - 2,036,632 2,036,632
� 2007A Improvement Bonds = 10,509 806,559 817,068
CapitalImprovements 1,010 735,827 736,837
Nonmajor Funds 2,595 5,669 1,687,098 1,695,362
' Total $ 260,248 $ 24,425 $ 5,302,518 $ 5,587,191
, B. Notes Receivable
The Equipment Internal Service Fund has a note receivable with the Scott County HRA that originated
� in 1998 as a result of the River City Centre Development Project. This note has an interest rate of 6.75%
and will be paid in full in February 2014. At December 31, 2011, the note's balance was $ 280,000.
During 2011, $ 85,000 of principal and $ 21,769 of interest was paid. The Revolving Loan Special
� Revenue Fund has a note receivable with Challenge Printing that originated in 2005. This note has an
interest rate of 2% and will be paid in full in April 2012. At December 31, 2011 the outstanding balance
was $ 22,133. During 2011, $ 65,518 of principal and $ 1,155 of interest was received on the note.
� 57
'
CITY OF SHAKOPEE ,
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2011 '
NOTE 6—CAPITAL ASSETS ,
Governmental capital asset activity for the year ended December 31, 2011 was as follows:
Beginning Ending �
Balance Increases Decreases Balance
Governmental Activities:
Capital Assets not being �
Depreciated:
Land $ 19,488,040 $ - $ - $ 19,488,040
Construction in Progress 729,343 5,149,567 578,591 5,300,319 �
Total Capital Assets
not being Depreciated 20,217,383 5,149,567 578,591 24,788,359
Capital Assets being �
Depreciated:
Buildings 33,688,980 54,001 - 33,742,981
Infrastructure 130,000,996 1,608,461 - 131,609,457 �
Machinery and Equipment 13,297,595 743,890 567,924 13,473,561
Total Capital Assets
being Depreciated 176,987,571 2,406,352 567,924 178,825,999 ,
Less Accumulated
Depreciation for: �
Buildings 8,61],150 901,628 - 9,512,778
lnfrastructure 52,459,626 4,332,942 - 56,792,568
Machinery and Equipment 5,519,026 884,264 221,233 6,182,057 �
Total Accumulated
Depreciation 66,589,802 6,118,834 221,233 72,487,403
Total Capital Assets being �
Depreciated,Net 110,397,769 (3,712,482) 346,691 ]06,338,596
Governmental Activities Capital �
Assets,Net $ 130,615,152 $ 1,437,085 $ 925,282 $ 131,126,955
Depreciation expense was charged to functions/programs of the City as follows: �
Governmental Activities:
General Government $ 261,037 �
Public Safety 567,341
Public Works 4,595,101
Parks and Recreation 695,355 �
Total Depreciation Expense - Governmental Activities $ 6,] ]8,834
�
5g �
,
� CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
, December 31, 2011
� NOTE 6—CAPITAL ASSETS
Business-type capital asset activity for the year ended December 31, 2011 was as follows:
' Restated
Beginning Ending
Balance Increases Decreases Balance
� Business-Type Activities:
Capital Assets not being
Depreciated:
� Land $ 3,944,380 $ - $ _ $ 3,944,380
Right-Of-Way 75,000 75,000
Construction in Progress - 1,745,002 - 1,745,002
, Total Capital Assets
not being Depreciated 3,944,380 1,820,002 5,764,382
Capital Assets being Depreciated:
� Line Rights 1,368,569 - - 1,368,569
Plant in Service 74,623,574 I 17,283 74,740,857
Machinery and Equipment 2,418,498 43],706 185,826 2,664,378
� Total Capital Assets
being Depreciated 78,410,641 548,989 185,826 78,773,804
� Less Accumulated
Depreciation for:
Line Rights 428,025 24,734 - 452,759
� Plant in Service 16,636,512 1,218,577 - 17,855,089
Machinery and Equipment 1,070,009 140,963 60,704 1,150,268
Total Accumulated
' Depreciation 18,134,546 1,384,274 60,704 19,458,116
Total Capital Assets being
Depreciated,Net 60,276,095 (835,285) 125,122 59,315,688
� Business-Type Activities Capital
Assets,Net $ 64,220,475 $ 984,717 $ ]25,122 $ 65,080,070
� Depreciation expense was charged to functions/programs of the City as follows:
� Business-Type Activities:
Sanitary Sewer $ 726,623
Storm Drainage 657,651
� Tota] Depreciation Expense - Business-Type Activities $ 1,384,274
�
� 59
'
CITY OF SHAKOPEE �
NOTES TO THE FINANCIAL STATEMENTS
December 31, 20ll '
NOTE 6—CAPITAL ASSETS �
Component unit capital asset activity for the year ended December 31, 2011 was as follows:
Beginning Ending �
Balance Increases Decreases Balance
Component Unit Capital Assets
not being Depreciated: �
Land and Land Rights $ 5,097,532 $ - $ - $ 5,097,532
Construction in Progress 2,299,805 8,180,541 10,474,167 6,179
Total Capital Assets �
not being Depreciated 7,397,337 8,180,541 10,474,167 5,103,711
Capital Assets being Depreciated:
Distribution 73,718,289 6,867,129 213,414 80,372,004 '
General 13,002,377 229,002 159,607 13,071,772
Total Capital Assets
being Depreciated 86,720,666 7,096,131 373,021 93,443,776 �
Less Accumulated Depreciation 23,331,821 2,646,499 268,021 25,710,299
Total Capital Assets being �
Depreciated,Net 63,388,845 4,449,632 105,000 67,733,477
Component Unit Capital Assets,Net $ 70,786,182 $ 12,630,173 $ 10,579,167 $ 72,837,188 �
Depreciation expense was charged to functions/programs of the component units as follows:
Component Units: '
Electric $ 1,548,643
Water 1,097,856 �
Total Depreciation Expense-Component Units $ 2,646,499
NOTE 7—LONG-TERM DEBT '
A. General Obligation Bonds '
The City issues general obligation (G.O.) bonds to provide for financing tax increment projects, street
improvements and construction of government buildings. Debt service is covered respectively by tax
increments and special assessments against benefited properties with any shortfalls being paid from ,
general taxes.
G.O. bonds are direct obligations and pledge the full faith and credit of the City. These bonds generally �
are issued as serial bonds with equal debt service payments each year. G.O. bonds currently outstanding
are shown on the following page.
�
60 �
�
� CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
� December 31, 2011
� NOTE 7—LONGTERM DEBT
B. Revenue Bonds
� The Commission issues Revenue Bonds for electric and water activity. Debt service is covered through
the revenue producing activities of these funds.
� C. Components of Long-Term Liabilities
Issue Interest Original Final Principal Due Within
1 Date Rates Issue Maturity Outstanding One Year
Govemmental Activities:
G.O.Bonds:
G.O.Improvement Bonds:
� 2004A OS/01/04 225%-4.10% $ 4,225,000 02/O1/25 $ 1,950,000 $ 285,000
2004C 11/Ol/04 3.00%-400% 2,570,000 02/Ol/15 1,020,000 25Q000
2006A 07/O1/O6 4 00% 3,440,000 02/Ol/17 2,16Q000 340,000
2007A 02/Ol/07 4.00% 1,370,000 02/Ol/17 930,000 105,000
� 2007B 09/Ol/07 4.00% 1,445,000 02/01/I8 1,040,000 145,000
2008A 09/Ol/08 3.50%-4.00% 2,170,000 02/O1/19 1,615,000 190,000
2010A OS/O1/10 0.50%-2.90% 1,555,000 02/Ol/21 1,525,000 190,000
G.O.Building Refunding
� Bonds 2004B OS/O1/04 2 25%-4.00% 2,275,000 02/O1/17 1,245,000 190,000
G.O.Capital Improvement
Bonds 2004D 11/O1/04 2.50%-420% 6,000,000 02/01/25 4,660,000 255,000
Total G.O Bonds 16,145,000 1,950,000
� Compensated Absences 1,703,898 766,754
Total Governmental
� Activities $ 17,848,898 $ 2,716,754
Business-Type Activities
CompensatedAbsences $ 69,192 $ 31,136
� Component Unit Long-Term Liabilities:
Utiliry Revenue Bonds:
Series 2004 Refunding Bonds 10/Ol/04 3.50%-4,50% 9,830,000 08/O1/28 $ 8,975,000 $ 250,000
Series 2006A Crossover Refunding Bonds 1 I/21/06 4.125%-4375% 10,570,000 02/O1/30 9,91Q000 350,000
, Total Bonds 18,885,000 600,000
Unamoriized Loss on Refunding (1,003,079) -
' Total Component Unit Long-Term Liabilities $ ]7,881,921 $ 600,000
Long-term bonded indebtedness listed above were issued to finance acquisition and construction of
� capital facilities or to refinance (refund) previous bond issues.
�
�
' 61
�
CITY OF SHAKOPEE �
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2011 �
NOTE 7—LONG-TERM DEBT '
D. Changes in Long-Term Liabilities
Long-term liability information for the year ended December 31, 2011 was as follows. ,
Beginning Ending Due Within
Balance Additions Reductions Balance One Year �
Governmental Aetivities:
Bonds Yayable $ 18,710,000 $ - $ 2,565,000 $ 16,145,000 $ 1,950,000
Compensated Absences 1,669,770 684,423 650,295 1,703,898 766,754
Total Governmental Activities $ 20,379,770 $ 684,423 $ 3,215,295 $ 17,848,898 $ 2,716,754 '
Business-Type Activities
Compensated Absences $ 65,956 $ 39,600 $ 36,364 $ 69,192 $ 31,136 �
Component Unit Activites:
G.O.Utility Revenue Bonds $ 21,470,000 $ - $ 2,585,000 $ 18,885,000 $ 600,000 �
Unamortized Loss on Refunding (1,128,886) - 125,807 (1,003,079) -
Unamortized Bond Premium 34,967 - 34,967 - -
Total Component Unit Activites $ 20,376,081 $ - $ 2,745,774 $ 17,881,921 $ 600,000 �
The General Fund, Employee Benefits Internal Service Fund and Sewer and Storm Drainage Enterprise
Funds typically liquidate the liability related to compensated absences. �
E. Governmental Activity G.O. Bonds
Debt service to maturity for outstanding G.O. bonds is as follows: '
Year Ending �
December 31, Principal Interest Total
2012 $ 1,950,000 $ 573,488 $ 2,523,488 '
2013 2,070,000 505,577 2,575,577
2014 2,050,000 432,371 2,482,371
2015 2,020,000 357,028 2,377,028 �
2016 1,630,000 288,268 1,918,268
2017-2021 4,450,000 762,790 5,212,790
2022-2026 1,975,000 176,473 2,151,473 �
Total $ 16,145,000 $ 3,095,995 $ 19,240,995
�
�
62 ,
!
� CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
� December 31, 2011
, NO�TE 7—LONG-TERM DEBT
F. Component Unit Revenue Bonds
� Debt service to maturity for outstanding revenue bonds is as follows:
Year Ending Utility Revenue Bonds
' December 31, Principal Interest Total
2012 $ 600,000 $ 794,881 $ 1,394,881
� 2013 590,000 771,821 1,361,821
2014 630,000 747,519 1,377,519
' 2015 640,000 721,638 1,361,638
2016 685,000 694,638 1,379,638
2017-2021 4,760,000 2,965,768 7,725,768
� 2022-2026 6,695,000 1,710,583 8,405,583
2027-2030 4,285,000 319,046 4,604,046
' Total $ 18,885,000 $ 8,725,894 $ 27,610,894
NOTE 8—CONDUIT DEBT OBLIGATIONS
� Conduit debt obligations are certain limited obligation revenue bonds or similar debt instruments issued
for the express purpose of providing capital financing for a specific third party. The City has issued
� various revenue bonds to provide funding to private-sector entities for projects deemed to be in the
public interest. Although these bonds bear the name of the City, the City has no obligation for such debt
beyond the resources provided by related leases or loans. Accordingly, the bonds are not reported as
liabilities in the financial statements of the City.
� As of December 31, 2011, the following conduit debt was issued:
� Date of Original Amount
Project Issue of Issue
� St. Francis RMC 10/06/04 $ 52,520,000
St. Francis RMC 12/23/87 8,000,000
' St. Gertrudes 09/30/10 5,675,000
Total $ 66,195,000
,
'
� 63
'
CITY OF SHAKOPEE �
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2011 �
NOTE 9—PLEDGING AGREEMENTS '
The City has pledged its taxing authority to back certain revenue bonds issued by the Scott County
Community Development Agency(CDA), formally known as the Scott County Housing and �
Redevelopment Authority (HRA), for the Blocks 3 and 4 redevelopment project in downtown Shakopee.
Refunding bonds were issued during 2006 to advance refund the 1997A, 1997D and 1997E Series Bonds
on their call dates. The 1997D Series Bonds were called on September 1, 2006 and the 1997A and
1997E Series Bonds were called on February 1, 2008. '
• Scott County CDA Housing Development Refunding Revenue Bonds, Series 2006A, the amount
is $ 3,260,000 and payments are scheduled from February 1, 2007 to 2027, with interest ranging �
from 4.25% to 4.50%.
• Scott County CDA Housing Development Refunding Revenue Bonds, Series 2006D, the amount '
is $ 905,000 and payments are scheduled from February 1, 2007 to 2018, with interest ranging
from 5.70% to 6.25%.
• Scott County CDA Housing Development Refunding Revenue Bonds, Series 2006E, the amount �
is $ 1,225,000 and payments are scheduled from February 1, 2018 to 2024, with interest ranging
from 4.50% to 4.70%. �
The City has pledged its taxing authority to back a series of revenue bonds issued by the Scott County
CDA for the North Ridge Court Redevelopment Project in downtown Shakopee. The issue is:
• Scott Count CDA Housin Develo ment Revenue Bonds, Series 2003, the amount is �
Y g P
$ 6,640,000 and payments are scheduled from February 1, 2006 to 2034, with interest ranging
from 2.00% to 5.00%. �
The City and the Shakopee EDA have a development agreement for costs related to an Imagine! Print
Solutions, formally known as Challenge Printing, facility moving to Shakopee. The Shakopee EDA '
issued a Taxable Tax Increment Revenue Note in the amount of$ 513,900 in support of development
costs for the Imagine! Print Solutions Project. Imagine! Print Solutions is the holder of the note. The
Shakopee EDA is liable only to the extent of the tax increment received from the lmagine! Print �
Solutions property. The ir,terest on the note is 6.00%. Payments are scheduled semiannually from
August 1, 2006 to February 1, 2015.
The City and the Shakopee EDA have a development agreement for costs related to Open Systems !
Facility located in Shakopee. The Shakopee EDA issued a Taxable Tax Increment Revenue Note in the
amount of$ 125,000 in support of development costs for the Open Systems Project. Open Systems is �
the holder of the note. The Shakopee EDA is liable only to the e�tent of the tax increment received from
the Open Systems property. The interest on the note is 6.00%. Payments are scheduled semiannually
from August 1, 2007 to Pebruary 1, 2014.
'
'
64 '
'
' CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
� December 31, 2011
� NOTE 10—INTERFUND ASSETS/LIABILITIES
The composition of interfund balances as of December 31, 2011 is as follows:
' Recievable Fund Payable Fund Amount
General Fund Nonmajor Governmental Funds $ 266,489
'
The due from/due to other funds balance represents borrowing to eliminate a cash deficit. This will be
� repaid as funds are available.
NOTE 11 —INTERFUND TRANSFERS
� Transfer In
Other Internal
General Capital Governmental Service
, Fund Improvements Funds Fund Total
Transfers Out:
General Fund $ - $ 1,207,630 $ 582,853 $ 346,911 $ 2,137,394
� CapitalImprovements - - 384,988 - 384,988
Other Governmental Funds 22,400 3,531 202,517 228,448
Sewer Fund 50,000 50,000
Storm Drainage Fund 50,000 - - - 50,000
� lnternal Service Fund - - 465,000 125,000 590,000
Total $ 122,400 $ 1,211,161 $ 1,635,358 $ 471,911 $ 3,440,830
� Transfers were made according to budgets for operating purposes, to close funds, to finance projects and
for the cancellation of the debt service levy.
' NOTE 12 —RISK MANAGEMENT
The City purchases commercial insurance coverage through the League of Minnesota Cities Insurance
' Trust (LMCIT) with other cities in the state which is a public entity risk pool currently operating as a
common risk management and insurance program. The City pays an annual premium to the LMCIT for
its insurance coverage. The LMCIT is self-sustaining through member premiums and reinsures through
� commercial companies for excess claims. The City is covered through the pool for any claims incurred
but unreported, however, retains risk for the deductible portion of its insurance policies. The amount of
these deductibles ranges from $ 2,500 to $ 5,000 and is considered immaterial to the financial
' statements.
There were no significant reductions in insurance from the previous year or settlements in excess of
' insurance coverage for any of the past three years.
Through the pool, the City is subject to reassessment but due to reserves and reinsurance contracts, the
� likelihood is very low. The policy limits through the pool included $ 2,000,000 aggregate for liability,
$ 1,500,000 for automobile coverage, $ 500,000 faithful performance employee bonding and
$ 1,000,000 for universal umbrella coverage. Property coverage is at approximately $ 91,000,000.
� 65
'
CITY OF SHAKOPEE '
NOTES TO THE FINANCIAL STATEMENTS
December 31, 20ll �
NOTE 13 —DEFINED BENEFIT PENSION PLANS—STATE-WIDE �
Public Employees' Retirement Association
A. Plan Description �
All full-time and certain part-time employees of the City are covered by defined benefit plans
administered by the Public Employees' Retirement Association of Minnesota(PERA). PERA '
administers the General Employees' Retirement Fund (GERF) and the Public Employees' Police and
Fire Fund (PEPFF), which are cost-sharing, multiple-employer retirement plans. These Plans are
established and administered in accordance with Minnesota Statutes Chapters 353 and 356. �
GERF members belong to either the Coordinated or 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 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 rnethods are used to compute benefits for PERA'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°io 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 GERF and PEPFF 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 members and 65 for Basic
and Coordinated Plan members hired prior to July 1, 1989. Normal retirement age is the age for '
unreduced Social Security benefits capped at 66 for Coordinated Plan 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.
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 yet
receiving them are bound by the provisions in effect at the time they last terminated their public service. �
66 �
'
� CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
1 December 31, 2011
� NOTE 13—DEFINED BENEFIT PENSION PLANS—STATE-WIDE
Public Employees' Retirement Association (Continued)
� A. Plan Description (Continued)
PERA issues a publicly available financial report that includes financial statements and required
� supplementary information for GERF 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 (800) 652-9026.
� B. Funding Policy
I Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. These Statutes
are established and amended by the State Legislature. The City makes annual contributions to the
pension plans equal to the amount required by state statutes. GERF Basic Plan members and
� Coardinated Plan members were required to contribute 9.1% and 6.25%, respectively, of their annual
covered salary in 2011. PEPFF members were required to contribute 9.6% of their annual covered salary
in 2011. In 2011, the City was required to contribute the following percentages of annual covered
� payroll: 11.78% for Basic Plan members, 7.25% for Coordinated Plan members and 14.4% for PEPFF
members. The City's contributions to the Public Employees' Retirement Fund for the years ending
December 31, 2011, 2010 and 2009 were $ 353,579, $ 549,973 and $ 516,529, respectively. The City's
contributions to the PEPFF for the years ending December 31, 2011, 2010 and 2009 were $ 500,257,
� $ 475,396 and $ 484,519, respectively. The City's contributions were equal to the contractually required
contributions for each year as set by state statute.
� NOTE 14 — DEFINED CONTRIBUTION PLAN— STATE-WIDE
Four Council Members of the City are covered by the Public Employees' Defined Contribution Plan
' (PEDCP), a multiple-employer deferred compensation plan administered by 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.
� 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% of salary which is matched by the elected official's employer.
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% of employer contributions and four-tenths of 1% of the assets in each member's account
annually.
� Total contributions made by the City during year 2011 were:
Contribution Amount Percentage of Covered Payroll Required
Employee Employer Employee Employer Rates
� o 0 0
$ 1,064 $ 1,064 5/0 5/0 5/o
, 67
'
CITY OF SHAKOPEE '
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2011 �
NOTE 15—DEFINED BENEFIT PENSION PLAN — SHAKOPEE VOLUNTEER FIRE �
RELIEF ASSOCIATION
A. Plan Description
The Shakopee Fire Relief Association (the "Association") is the administrator of a single employer �
defined benefit pension plan established to provide benefits for members of the Shakopee Fire
Department. �
The Association provides retirement and disability benefits to members, and benefits to survivors upon
the death of eligible members. Benefits are established in accordance with Minnesota Statutes. The �
defined retirement benefits are based on a member's years of service. Benefit provisions can be
amended by the Association within the parameters provided by Minnesota Statutes.
The Association issues a publicly available financial report that includes financial statements and ,
required supplementary information. That report may be obtained by writing to Shakopee Fire Relief
Association, 129 Holmes Street South, Shakopee, Minnesota 55379. �
B. Funding Policy
Minnesota Statutes Chapter 69.772 specifies minimum support rates required on an annual basis. The �
minimum support rates from the municipality and from state aid are determined as the amount required
to meet the normal cost plus amortizing any existing prior service costs over a 10 year period. Actuarial
valuations are not required for the Association as the Association follows Minnesota Statutes for the �
valuation calculation. The City has decided to make an annual contribution in addition to state aid
received for pension cost. The Association is comprised of volunteers; therefore, there are no payroll
expenditures (i.e., there are no covered payroll percentage calculations). �
Contributions totaling $ 509,553 ($ 351,976 City of Shakopee and $ 157,577 State of Minnesota) were
made in accordance with contribution requirements as of December 31, 2011. These contributions were �
entirely for normal service cost.
The City's annual pension cost for the current year and related information is as follows:
Valuation Date December 31, 2011 ,�
Actuarial Cost Method Entry Age Normal
Amortization Method Level annual dollar closed �
Remaining Amortization Period:
Normal Cost 20 years
Prior Service Cost 10 years �
Asset Valuation Method Market
Actuarial Assumptions:
Investment Rate of Return 5% �
Projected Salary Increases N/A
Includes Inflation at N/A �
Cost of Living Adjustments None
68 '
1
' CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
' December 31, 2011
' NOTE 15—DEFINED BENEFIT PENSION PLAN—SHAKOPEE VOLUNTEER FIRE
RELIEF ASSOCIATION
B. Funding Policy (Continued)
' Annual Percentage Net
Pension of APC Pension
� Year Ended Cost (APC) Contributed Obligation
' 12/31/09 $ 240,169 100°/a $ _
12/31/10 339,752 100%
12/31/11 351,976 100% -
� Statutory Statutory Funded
Valuation Value of Accrued (Unfunded) Funded
� Date Assets Liability (SAL) SAL Ratio
12/31/09 $ 3,190,043 $ 4,364,302 $ (1,174,259) 73.1%
, 12/31/10 3,690,248 4,507,908 (817,660) 81.9%
12/31/11 3,974,012 4,480,608 (506,596) 88.7%
' The Association is comprised of volunteers; therefore, there are no payroll expenditures (i.e., there are
no covered payroll amounts or percentage calculations).
, NOTE 16—POST EMPLOYMENT HEALTH BENEFITS PLAN
A. Plan Description
' The City provides a single-employer defined benefit health care plan to eligible retirees and their
spouses. The plan offers medical coverage administered by Medica. It is the City's policy to
' periodically review its medical coverage and to obtain requests for proposals in order to provide the most
favorable benefits and premiums for City employees and retirees.
' B. Funding Policy
Retirees and their spouses contribute to the health care plan at the same rate as City employees. This
� results in the retirees receiving an implicit rate subsidy. Contribution requirements are established by the
City, based on the contract terms with Medica. The required contributions are based on projected
pay-as-you-go financing requirements. For the year 2011, the City contributed $ 45,723 to the plan. As
of January 1, 2011, there were eight retirees and two disabled officers receiving health benefits from the
� City's health plan.
'
' 69
,
CITY OF SHAKOPEE '
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2011 '
NOTE 16— POST EMPLOYMENT HEALTH BENEFITS PLAN '
C. Annual OPEB Cost and Net OPEB Obligation
The City's annual OPEB cost (expense) is calculated based on the annual required contribution (ARC) '
of the City, an amount actuarially determined in accordance with the parameters of GASB Statement
No. 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover
normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period �
not to exceed 30 years. The following table shows the components of the City's annual OPEB cost of
the year, the amount actually contributed to the plan, and changes in the City's net OPEB obligation to
the plan. '
ARC $ 211,306
Interest on Net OPEB Obligation 23,164 '
Adjustment to ARC (33,490)
Annual OPEB Cost (Expense) 200,980
Contribution Made (45,723) '
Increase in Net OPEB Obligation 155,257
Net OPEB Obligation - Beginning of Year 579,104
Net OPEB Obligation - End of Year $ 734,361 '
The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan and the net '
OPEB obligation for 2011 was as follows:
Percentage of �
Fiscal Year Annual OPEB Employer Arulual OPEB Net OPEB
End Cost Contribution Cost Contributed Obligation
12/31/11 $ 200,980 $ 45,723 23% $ 734,361 t
12/31/10 170,040 27,020 16% 579,104
12/31/09 250,175 54,644 22% 436,084 '
D. Funded Status and Funding Progress
As of January 1, 2010, the most recent actuarial valuation date, the City had no assets deposited to fund '
the plan. The actuarial accrued liability for benefits was $ 1,483,810 and the actuarial value of assets was
$ 0, resulting in an unfunded actuarial accrued liability (UAAL) of$ 1,483,810. The covered payroll �
(annual payroll of active employees covered by the plan) was $ 7,154,161 and the ratio of the UAAL to
the covered payroll was 20.7%.
�
�
70 '
,
' CITY OF SHAKOPEE
NOTES TO THE FINANCIAL STATEMENTS
' December 31, 2011
, NOTE 16—POST EMPLOYMENT HEALTH BENEFITS PLAN
D. Funded Status and Funding Progress (Continued)
' Actuarial valuations involve estimates of the value of reported amounts and assumptions about the
probability of occurrence of events far into the future. Examples include assumptions about future
employment, mortality and the health care cost trend. Amounts determined regarding the funded status
� of the plan and the ARC of the employer are subject to continual revision as actual results are compared
with past expectations and new estimates are made about the future.
' The Schedule of Funding Progress—Other Post Employment Benefits, presented as required
supplementary information following the Notes to the Financial Statements, presents multi-year trend
information about whether the actuarial value of plan assets is increasing or decreasing over time relative
' to the actuarial accrued liabilities for benefits.
E. Actuarial Methods and Assumptions
, Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as
understood by the employer and the plan members) and include the types of benefits provided at the time
of each valuation and the historical pattern of sharing of benefit costs between the employer and plan
' members to that point. The actuarial methods and assumptions used include techniques that are
designed to reduce the effects of short-term volatility in actuarial accrued liabilities, consistent with the
long-term perspective of the calculations.
' In the January l, 2010 actuarial valuation, the projected unit credit actuarial cost method was used. The
actuarial assumptions included a 4.0 % discount rate, which is based on the investment yield expected to
finance benefits depending on whether the plan is funded in a separate trust (about 7.0% to 8.5%, long-
� term, similar to a pension plan) or unfunded (3.5% to 5.0%, shorter-term, based on City's general
assets). The City cunently does not fund this benefit. At the actuarial valuation date, the annual health
care cost trend rate was calculated to be 10% initially, reduced incrementally to an ultimate rate of 5%
' after five years. The UAAL is being amortized as a level percentage of payroll on an open basis. The
remaining amortization period at January 1, 2010 was 30 years.
, NOTE 17— SEGMENT INFORMATION
The City maintains two enterprise funds that account for the sewer and storm drainage utilities. The City
considers each of its enterprise funds to be a segment. Since the required segment information is already
' included in the City's proprietary funds' Balance Sheet and Statement of Revenues, Expenses and
Changes in Fund Net Assets balances, this information has not been repeated in the Notes to the
Financial Statements.
' NOTE 18—CHANGES IN ACCOUNTING PRINCIPLE
' For the year ended December 31, 2010, the Commission's funds, Water and Electric Enterprise Funds,
were reported as a blended component unit of the City. An analysis of the Commission's operations in
2011 indicated it no longer met the criteria for blending and it was determined the Commission's funds
would be presented as discretely presented component units prospectively. This resulted in a decrease of
' $ 81,547,998 in the beginning net asset balances for the business-type activities for the year ended
December 31, 2011.
� 71
,
CITY OF SHAKOPEE '
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2011 '
NOTE 19—FUND BALANCE DETAIL '
Fund equity balances are classified as follows to reflect the limitations and restrictions of the respective
funds.
2004A 2007A Other ,
General Improvement Improvement Capital Governmental
Fund Bonds Bonds Improvements Funds Total �
Nonspendable:
Prepaid Items $ 131,447 $ - $ - $ - $ - $ 131,447
Restricted: ,
Forfeitures - - - - 208,518 208,518
Transit - - - - 1,237,762 1,237,762
Telecomminication - - - - 45,681 45,681 '
SCDP Grant - - - - 22,462 22,462
Revolving Loans - - - - 249,147 249,147
Economic Development - - - - 497,775 497,775
Debt Service - 443,185 156,087 - 4,026,674 4,625,946 �
CapitalImprovements - - - - 958,195 958,195
Total ResMcted - 443,185 156,087 - 7,246,214 7,845,486
Assigned: ,
CapitalImprovements - - - 6,964,247 413,228 7,377,475
Unassigned 9,172,747 - - - (484,089) 8,688,658
Total Fund Balance $ 9,304,194 $ 443,185 $ 156,087 $ 6,964,247 $ 7,175,353 $ 24,043,066 '
NOTE 20—SUBSEQUENT EVENTS �
The City has evaluated subsequent events through April 25, 2012, the date which the financial
statements were available to be issued.
The City approved to refund G.O Bonds 2004A and 2004D due to favorable market rates. The sale date '
is set for May 15, 2012 and the refunded bonds will be approximately$ 4,945,000 .
NOTE 21 —COMMITTMENTS I
Proj ect Work 12/31/11 '
Authorization Completed Commitment
Greenfield Park East $ 516,570 $ 497,298 $ 19,272 ,
2011 Street Reconstruction 3,162,326 2,980,644 181,682
Fire Station#2 2,380,661 2,256,963 123,698
'
'
72 '
'
�
�
�
'
'
'
'
'
'
REQUIRED SUPPLEMENTARY INFORMATION
,
'
'
,
'
,
'
,
' 73
'
CITY OF SHAKOPEE �
SCHEDULE OF FUNDING PROGRESS-OTHER POST EMPLOYMENT BENEFITS
December 31,2011 �
Actuarial �
Accrued Liability UAAL as a
Actuarial (AAL) - Unfunded Percentage of
Actuarial Value of Projected AAL Funded Covered Covered '
Valuation Assets Unit Credit (UAAL) Ratio Payroll Payroll
Date (a) (b) (b-a) (a/b) (c) ((b-a)/c)
O1/O1/08 $ - $ 1,887,961 $ 1,887,961 0.0% $ 6,652,669 28.4% '
O1/O1/09 * - 1,887,961 1,887,961 0.0% 6,652,669 28.4%
O1/O1/10 - 1,483,810 1,483,810 0.0% 7,154,161 20.7%
O1/O1/11 * - 1,483,810 1,483,810 0.0% 7,154,161 20.7% ,
* Because an actuarial valuation is being performed once every two years,the amounts for '
the O 1/O1/08 and O 1/O 1/09, and the O 1/0 U10 and O 1/O 1/11 valuations are the same.
,
'
t
�
'
1
,
,
�
'
74 '
'
'
�
1
,
�
'
'
'
�
SUPPLEMENTARY INFORMATION
'
'
,
�
'
'
'
'
' 75
�
CITY OF SNAKOPEE '
SCHEDULE OF REVENUES,EXPENDITURES AND
CHANGES IN FUND BALANCES- �
BUDGET AND ACTUAL-GENERAL FUND
For the Year Ended December 31,2011
Variance with '
Original and Actual Final Budget-
Final Budget Amounts Over(Under)
REVENUES '
Property Taxes
General Property Taxes $ 11,585,300 $ 12,394,978 $ 809,678
Fiscal Disparities 1,630,520 1,649,146 18,626 ,
Lodging Tax 160,000 223,764 63,764
Aggregate Tax 8,000 11,128 3,128
Total PropertyTaxes 13,383,820 14,279,016 895,196
Special Assessments 13,000 21,905 8,905 '
Licenses and Permits 1,246,750 1,225,560 (21,190)
Intergovernmental Revenues '
Federal Grants 5,000 5,995 995
PERA Aid 11,930 18,170 6,240 ,
Police Aid 300,000 293,248 (6,752)
State Grants 412,630 468,128 55,498
Other Grants and Aids 8,000 10,535 2,535
Total Intergovernmental Revenues 737,560 796,076 58,516 ,
Charges for Services
General Government 1,904,780 2,049,432 144,652 '
Public Safety 320,040 423,561 103,521
Public Works 274,800 341,787 66,987
Parks and Recreation 1,047,390 ],064,333 16,943
Total Charges for Services 3,547,010 3,879,113 332,103 '
Fines and Forfeitures 436,000 357,249 (78,751)
Miscellaneous Revenues '
lnvestment Income 300,000 274,746 (25,254)
Contributions and Donations 3,000 4,944 1,944
Rents 2,480 7,605 5,125 �
Other 37,800 110,182 72,382
Total Miscellaneous Revenues 343,280 397,477 54,197
Total Revenues 19,707,420 20,956,396 1,248,976
EXPENDITURES �
General Government
Mayor and Council 202,240 153,876 (48,364) �
Administration 793,030 689,897 (]03,133)
CityAdministrator 327,180 303,857 (23,323)
Finance 794,600 750,327 (44,273)
Legal - 9,993 9,993 ,
Planning 495,800 433,687 (62,113)
Government Buildings 214,610 193,572 (21,038)
Information Technology 207,240 178,504 (28,736)
Unallocated 220,000 61,146 (158,854) '
Total General Government 3,254,700 2,774,859 (479,841)
76 '
'
, CITY OF SHAKOPEE
SCHEDULE OF REVENUES,EXPENDITURES AND
' CHANGES IN FUND BALANCES-
BUDGET AND ACTUAL-GENERAL FUND
For the Year Ended December 31,2011
(Continued)
'
Variance with
Original and Actual Final Budget-
, Final Budget Amounts Over(Under)
EXPENDITURES
Public Safety
� Police $ 6,969,270 $ 6,646,603 $ (322,667)
Fire 1,945,360 2,028,186 82,826
Building Inspection 801,100 727,126 (73,974)
Total Public Safety 9,715,730 9,401,915 (313,815)
' Public Works
Current:
Streets and Highways:
, Engineering 661,630 598,587 (63,043)
Streets 2,059,700 2,004,833 (54,867)
Shop 87,330 (1,316) (88,646)
' CapitalOutlay 35,000 27,477 (7,523)
Total Public Works 2,843,660 2,629,581 (214,079)
Parks and Recreation
' Current:
Parks and Recreation:
Park Maintenance 1,576,910 1,352,282 (224,628)
' Natural Resources 58,400 19,309 (39,091)
Library/Congregate Dining 304,330 247,92] (56,409)
Recreation 2,421,910 2,237,357 (184,553)
CapitalOutlay - 11,714 11,714
� Total Parks and Recreation 4,361,550 3,868,583 (492,967)
Total Expenditures 20,175,640 18,674,938 (1,500,702)
' Excess of Revenues Over
(Under)Expenditures (468,220) 2,281,458 2,749,678
' OTHER FINANCING SOURCES(USES)
Transfers In 122,400 122,400
Transfers Out - (2,137,394) (2,137,394)
' Total Other Financing Sources
(Uses) 122,400 (2,014,994) (2,137,394)
Net Change in Fund Balances $ (345,820) 266,464 $ 612,284
, FUND BALANCES
Beginning of Year 9,037,730
, End of Year $ 9,304,194
�
' 77
'
CITY OF SHAKOPEE ,
COMBINING BALANCE SHEET-
NONMAJOR GOVERNMENTAL FUNDS '
December 31,2011
'
Special Revenue ,
Forfeiture Transit Telecommunication '
ASSETS
Cash and Investments $ 208,364 $ 1,339,047 $ 37,438
Taxes Receivable -Delinquent - - - '
Special Assessments Receivable:
Delinquent - - -
Deferred - - - '
Accounts Receivable - 59,502 8,098
Interest Receivable 808 5,246 145
Due From Other Governments 118 - - '
Notes Receivable - - -
Total Assets $ 209,290 $ 1,403,795 $ 45,681 ,
LIABILITIES AND FUND
BALANCES ,
Liabilities
Accounts Payable $ 725 $ 166,033 $ -
Contracts Payable - - - '
Due to Other Funds - - -
Due to Other Governments 47 - - '
Deferred Revenue - - -
Total Liabilities 772 166,033 -
Fund Balances ,
Restricted for:
Special Revenue 208,518 1,237,762 45,681 ,
Debt Service - - -
Capital Projects - - -
Assigned - - - '
Unassigned - - -
Total Fund Balances 208,518 1,237,762 45,681
Total Liabilities and '
Fund Balances $ 209,290 $ 1,403,795 $ 45,681
�
78
'
,
'
,
,
Special Revenue Debt Service
� Economic 2004B 2004C
Revolving Development Refunding Improvement
� SCDP Grant Loan Authority Total Bonds Bonds
$ 40,173 $ 242,803 $ 521,786 $ 2,389,611 $ 361,413 $ 715,119
� - - 60 60 2,535 -
, = = � - = 417,343
67,600
157 949 1,771 9,076 909 2,703
� = - 16 134 773 =
22,133 22,133
� $ 40,330 $ 265,885 $ 523,633 $ 2,488,614 $ 365,630 $ 1,135,165
,
� $ 17,868 $ _ $ 25,798 $ 210,424 $ 374 $ 374
' = 16,738 - 16,785 - -
60 60 2,535 417,343
17,868 16,738 25,858 227,269 2,909 417,717
'
� 22,462 249,147 497,775 2,261,345 - -
362,721 717,448
� - - - - - -
22,462 249,147 497,775 2,261,345 362,721 717,448
,
$ 40,330 $ 265,885 $ 523,633 $ 2,488,614 $ 365,630 $ 1,135,165
'
79
,
'
CITY OF SHAKOPEE '
COMBINING BALANCE SHEET-
NONMAJOR GOVERNMENTAL FUNDS '
December 31, 2011
(Continued)
'
Debt Service �
2004D 2006A 2007B
Building Improvement Improvement
Bonds Bonds Bonds �
ASSETS
Cash and Investments $ 464,613 $ 908,080 $ 489,571
Taxes Receivable -Delinquent - - - '
Special Assessments Receivable:
Delinquent - 2,003 180
Deferred - 231,530 75,776 �
Accounts Receivable - - -
Interest Receivable (3) 3,559 1,572
Due From Other Govemments - - - �
Notes Receivable - - -
Total Assets $ 464,610 $ 1,145,172 $ 567,099 �
LIABILITIES AND FUND
BALANCES ,
Liabilities
Accounts Payable $ 374 $ 374 $ 374
Contracts Payable - - - '
Due to Other Funds - - -
Due to Other Governments - - - '
Defened Revenue - 233,533 75,956
Total Liabilities 374 233,907 76,330
Fund Balances '
Restricted for:
Special Revenue - - - �
Debt Service 464,236 911,265 490,769
Capital Projects - - -
Assigned - - - �
Unassigned - - -
Total Fund Balances 464,236 911,265 490,769
Total Liabilities and '
Fund Balances $ 464,610 $ 1,145,172 $ 567,099
'
80 '
�
�
�
'
, Debt Service Capital Projects
2008A 2010A
Improvement Improvement
� Bonds Bonds 2011A Bond Total Park Reserve TIF No. 10
$ 478,636 $ 317,164 $ 280,342 $ 4,014,938 $ 1,011,667 $ 20,106
� - - - 2,535 - -
574 2,912 - 5,669 - -
� 498,040 285,013 179,396 1,687,098 - _
131
1,870 703 1,105 12,418 4,000 80
� = 1,163 = 1,936 = =
� $ 979,120 $ 606,955 $ 460,843 $ 5,724,594 $ 1,015,798 $ 20,186
,
� $ 374 $ 374 $ = $ 2,618 $ 37,551 $ 19,818
24,865
' - - - - 189 =
498,614 287,925 179,396 1,695,302
498,988 288,299 179,396 1,697,920 62,605 19,818
�
, 480,132 318,656 281,447 4,026,674 - -
- - - - 953,193 368
� - - - - - -
480,132 318,656 281,447 4,026,674 953,193 368
�
$ 979,120 $ 606,955 $ 460,843 $ 5,724,594 $ 1,015,798 $ 20,186
�
81
'
�
CITY OF SHAKOPEE �
COMBINING BALANCE SHEET-
NONMAJOR GOVERNMENTAL FUNDS �
December 31,2011
(Continued)
�
Capital Projects '
TIF No. 12 TIF No. 13 2010 Projects �
ASSETS
Cash and Investments $ 42,706 $ 19,442 $ 150,631
Taxes Receivable -Delinquent - - _ �
Special Assessments Receivable:
Delinquent - - _
Deferred - - _ �
Accounts Receivable - - _
Interest Receivable 169 77 581
Due From Other Governments - - - ,
Notes Receivable - - _
Total Assets $ 42,875 $ 19,519 $ 151,212 ,
LIABILITIES AND FUND
BALANCES '
Liabilities
Accounts Payable $ 42,094 $ 15,666 $ 22,341
Contracts Payable - - - '
Due to Other Funds - - -
Due to Other Governments - - _ ,
Deferred Revenue - - -
Total Liabilities 42,094 15,666 22,341
Fund Balances �
Resh-icted for:
Special Revenue - - _ '
Debt Service - - _
Capital Projects 781 3,853 -
Assigned - 128,871 �
Unassigned - - _
Total Fund Balances 781 3,853 128,871
Total Liabilities and �
Fund Balances $ 42,875 $ 19,519 $ 151,212
i
g2
'
�
�
�
i
' Capital Projects
Total
Fire Station 2 Governmental
� Construction 2011 Projects Total Funds
$ 721,161 $ - $ 1,965,713 $ 8,370,262
' - - � 2,595
- - - 5,669
� � _ - 1,687,098
131 67,731
1,638 (4,219) 2,326 23,820
� - - - 2,070
22,133
' $ 722,799 $ (4,219) $ 1,968,170 $ 10,181,378
�
� $ 322,851 $ 64,349 $ 524,670 $ 737,712
112,850 149,032 286,747 286,747
- 266,489 266,489 266,489
� 2,741 = 2,930 19,715
1,695,362
438,442 479,870 1,080,836 3,006,025
�
� = = = 2,261,345
4,026,674
- - 958,195 958,195
� 284,357 - 413,228 413,228
(484,089) (484,089) (484,089)
284,357 (484,089) 887,334 7,175,353
,
$ 722,799 $ (4,219) $ 1,968,170 $ 10,181,378
�
� 83
�
CITY OF SHAKOPEE �
COMBINING STATEMENT OF REVENUES,EXPENDITURES AND CHANGES
IN FUND BALANCES-NONMAJOR GOVERNMENTAL FUNDS �
For the Year Ended December 31,2011
Special Revenue ,
Forfeiture Transit Telecommunication '
REVENUES
Property Taxes $ - $ - $ _ �
Tax Increments - - _
Special Assessments - - _
Licenses and Pernuts - - 32,640 '
Intergovernmental:
State Grants 3,000 750,292 -
Charges for Services - 77,342 -
Fines and Forfeitures 53,962 - - �
Miscellaneous:
Investment Income 5,779 29,328 1,377
Other 15,574 - - �
Total Revenues 78,315 856,962 34,017
EXPENDITURES
Current ,
General Government - 1,229,825 -
Public Safety 58,909 - -
Culture and Recreation - - - �
Economic Development - - -
Debt Service
Principal - - - �
Interest and Other Charges - - -
Capital Outlay - - 37,528
Total Expenditures 58,909 1,229,825 37,528
Excess of Revenues Over ,
(Under)Expenditures 19,406 (372,863) (3,511)
OTHER FINANCING SOURCES �
(USES)
Transfers In - - - �
Transfers Out - (11,200) -
Total Other Financing
Sources(Uses) - (11,200) - ,
Net Change in Fund Balances 19,406 (384,063) (3,511)
FUND BALANCES '
Beginning of Year 189,112 1,621,825 49,192
End of Year $ 208,518 $ 1,237,762 $ 45,681 ,
84
�
�
�
,
� Special Revenue Debt Service
Economic 2000A 2003A 2004B
� Revolving Development Improvement Improvement Refunding
SCDP Grant Loan Authority Total Bonds Bonds Bonds
� $ = $ _ $ 88 $ 88 $ = $ - $ 121,638
2,248 2,248
- - - - 15,005 19,694 -
' - = = 32,640 = - _
753,292 - _
- - - 77,342 - - -
� - - - 53,962 - - _
539 7,016 9,906 53,945 (1,664) (4,537) 3,864
' 1,900 - 5,200 22,674 - _ _
2,439 7,016 17,442 996,191 13,341 15,157 125,502
� - - - 1,229,825 - - -
- - - 58,909 - - _
� 35,720 - 56,716 92,436 - - _
� _ - _ - 225,000 665,000 185,000
892 892 5,569 9,805 52,109
- - - 37,528 - - -
35,720 892 56,716 1,419,590 230,569 674,805 237,109
'
(33,281) 6,124 (39,274) (423,399) (217,228) (659,648) (111,607)
�
� - = 80,000 80,000 - 378,376 130,000
�ii,2oo� �22,aoo� �3,sis�
� - - 68,800 57,600 (3,515) 378,376 130,000
(33,281) 6,124 29,526 (365,799) (220,743) (281,272) 18,393
' S5,743 243,023 468,249 2,627,144 220,743 281,272 344,328
� $ 22,462 $ 249,147 $ 497,775 $ 2,261,345 $ - $ - $ 362,721
85
�
�
CITY OF SHAKOPEE �
COMBINING STATEMENT OF REVENUES,EXPENDITURES AND
CHANGES IN FUND BALANCES-NONMAJOR GOVERNMENTAL FUNDS '
For the Year Ended December 31,2011
(Continued)
Debt Service �
2004C 2004D 2006A 2007B
Improvement Building Improvement Improvement �
Bonds Bonds Bonds Bonds
REVENUES
Property Taxes $ - $ - $ - $ - '
Tax Increments - - - -
Special Assessments 113,784 - 82,086 20,281
Licenses and Pemuts - - - - ,
Intergovernmental:
State Grants - - - -
Charges for Services - - - -
Fines and Forfeitures - - - - �
Miscellaneous:
Investment Income 14,903 443 14,597 7,684
Other - - - - '
Total Revenues 128,687 443 96,683 27,965
EXPENDITURES
Current �
General Government - - - -
Public Safety - - - -
Culture and Recreation - - - - �
Economic Development - - - -
Debt Service
Principal 250,000 250,000 330,000 145,000 �
Interest and Other Charges 42,980 193,185 93,805 45,224
Capital Outlay - - - -
Total Expenditures 292,980 443,185 423,805 190,224 ,
Excess of Revenues Over
(Under)Expenditures (164,293) (442,742) (327,122) (162,259)
OTHER FINANCING SOURCES �
(USES)
Transfers In - 465,000 - 87,853 '
Transfers Out - - - -
Total Other Financing
Sources(Uses) - 465,000 - 87,853 �
Net Change in Fund Balances (164,293) 22,258 (327,122) (74,406)
FUND BALANCES '
Beginning of Year 881,741 441,978 1,238,387 565,175
End of Year $ 717,448 $ 464,236 $ 911,265 $ 490,769 �
86
�
�
�
,
' Debt Service Capital Projects
2008A 2010A
� Improvement Improvement East Dean
Bonds Bonds 2011A Bond Total Park Reserve TIF No. 10 Lake
� $ = $ 137,440 $ = $ 259,078 $ = $ - $ =
39,636
150,926 75,856 275,439 753,071 - - _
� - - - - 22,950 - -
- - - - 1,782 - -
i _ _ _ _ _ _ _
15,306 5,879 6,008 62,483 37,170 368 (6,025)
' 166,232 219,175 281,447 1,074,632 61,902 40,004 (6,025)
� - - - - - - -
� _ = = = 45,517 - =
39,636
� 190,000 30,000 - 2,270,000 = _ =
65,812 26,214 534,703
- - - - 848,356 - -
255,812 56,214 - 2,804,703 893,873 39,636 -
�
(89,580) 162,961 281,447 (1,730,071) (831,971) 368 (6,025)
�
' 187,641 14,876 = 1,263,746 _ - 6,025
(3,515)
� 187,641 14,876 - 1,260,231 - - 6,025
98,061 177,837 281,447 (469,840) (831,971) 368 -
� 382,071 140,819 - $4,496,514 1,785,164 - -
� $ 480,132 $ 318,656 $ 281,447 $4,026,674 $ 953,193 $ 368 $ -
87
�
!
CITY OF SHAKOPEE �
COMBINING STATEMENT OF REVENUES,EXPENDITURES AND
CHANGES IN FUND BALANCES-NONMAJOR GOVERNMENTAL FUNDS '
For the Year Ended December 31,2011
(Continued)
Capital Projects �
2008 2009 �
TIF No. 12 Projects TIF No. 13 Projects
REVENUES
Property Taxes $ - $ - $ - $ - �
Tax Increments 84,188 - 34,812 -
Special Assessments - - - -
Licenses and Pemuts - - - - �
Intergovernmental:
State Grants - - - -
Charges for Services - - - -
Fines and Forfeitures - - - - ,
Miscellaneous:
Investrnent Income 781 (3,377) 372 16
Other - - - - �
Total Revenues 84,969 (3,377) 35,184 16
EXPENDITURES
Current �
General Government - - - -
Public Safety - - - -
Culture and Recreation - - - - �
Economic Development 84,188 - 31,331 -
Debt Service
Principal - - - - '
Interest and Other Charges - - - -
Capital Outlay - - - -
Total Expenditures 84,188 - 31,331 - �
Excess of Revenues Over
(Under)Expenditures 781 (3,377) 3,853 16
OTHER FINANCING SOURCES �
(USES)
Transfers In - 587 - - '
Transfers Out - (187,641) - (14,892)
Total Other Financing
Sources(Uses) - (187,054) - (14,892) �
Net Change in Fund Balances 781 (190,431) 3,853 (14,876)
FUND BALANCES �
Beginning of Year - 190,431 - 14,876
End of Year $ 781 $ - $ 3,853 $ - '
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1
� Capital Projects
Total Other
' 2010 Fire Station 2 Governmental
Projects Construction 2011 Projects Total Funds
� $ _ $ = $ � $ - $ 259,166
158,636 160,884
- - - - 753,071
- - - 22,950 55,590
' - - 1,593,278 1,593,278 2,346,570
- - - 1,782 79,124
' - - - - 53,962
6,456 35,390 (44,629) 26,522 142,950
' - - - - 22,674
6,456 35,390 1,548,649 1,803,168 3,873,991
� - - - - 1,229,825
- - - - 58,909
' = = - 45,517 45,517
155,155 247,591
� = = = = 2,270,000
535,595
8,983 2,512,919 1,915,935 5,286,193 5,323,721
8,983 2,512,919 1,915,935 5,486,865 9,711,158
'
(2,527) (2,477,529) (367,286) (3,683,697) (5,837,167)
'
� = 285,000 = 291,612 1,635,358
�2o2,s33� �zzs,a4s�
- 285,000 - 89,079 1,406,910
, (2,527) (2,192,529) (367,286) (3,594,618) (4,430,257)
, 131,398 2,476,886 (116,803) 4,481,952 11,605,610
� $ 128,871 $ 284,357 $ (484,089) $ 887,334 $ 7,175,353
89
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CITY OF SHAKOPEE '
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL - '
TRANSIT FUND
For the Year Ended December 31, 2011 '
Original Variance with '
And Final Actual Final Budget -
Budget Amounts Over(Under)
REVENUES �
Intergovernmental Revenue
State Grants $ 667,000 $ 750,292 $ 83,292
Charges for Services 30,000 77,342 47,342 '
Miscellaneous Revenues �
Investment Income 42,000 29,328 (12,672)
Total Revenues 739,000 856,962 117,962 ,
EXPENDITURES
Current: �
General Government 1,191,270 1,229,825 38,555
Excess of Revenues Over '
(Under) Expenditures 739,000 (372,863) 117,962
OTHER FINANCING USES '
Transfers Out (11,200) (11,200) -
Net Change in Fund Balance $ 727,800 (384,063) $ 117,962 '
FUND BALANCE '
Beginning of Year 1,621,825
End of Year $ 1,237,762 �
'
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' CITY OF SHAKOPEE
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
' IN FUND BALANCE - BUDGET AND ACTUAL-
ECONOMIC DEVELOPMENT AUTHORITY FUND
For the Year Ended December 31, 2011
'
' Original Variance with
And Final Actual Final Budget -
Budget Amounts Over(Under)
' REVENUES
Property Taxes
Property Taxes $ 80,000 $ 88 $ (79,912)
' Taac Increments - 2,248 2,248
Total Property Taxes 80,000 2,336 (77,664)
' Miscellaneous Revenues
Investment Income $ 10,000 $ 9,906 $ (94)
' Other - 5,200 5,200
Total Miscellaneous 10,000 15,106 5,106
' Total Revenues 90,000 17,442 (72,558)
EXPENDITURES
' Economic Development
Current 99,730 56,716 (43,014)
' Excess of Revenues Over
(Under) Expenditures (9,730) (39,274) (29,544)
' OTHER FINANCING SOURCES (USES)
Transfers In - 80,000 80,000
, Transfers Out (11,200) (11,200) -
Total Other Financing Sources
(Uses) (11,200) 68,800 80,000
, Net Change in Fund Balance $ (20,930) 29,526 $ 50,456
' FUND BALANCE
Beginning of Year 468,249
' End of Year $ 497,775
'
91
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'
CITY OF S1iAKOPEE '
COMBININC STATEM1IENT OF FL?ND NET ASSETS-
INTERNAL SERVICE FUNDS
December 31,2011 �
Governmental Activities-Internal Service Funds
n ormahon '
Employee and
Equipment Buildings Park Assets Benefits Technology Total
ASSETS
Current Assets '
Cash and Investments,Including
Cash Gquivalents $ 6,676,865 $ 7,111,478 $ 1,063,057 $ 1,476,081 $ 307,305 $ 16,634,786
InterestReceivable 25,279 29,577 3,635 6,119 1,011 65,621
Notes Receivable,Current Portion 90,000 - - - - 90,000 �
TotalCurrentAssets 6,792,144 7,141,055 1,066,692 1,482,200 308,316 16,790,407
Noncurrent Assets
Notes Receivable 190,000 - - - - 190,000
Capital Assets: '
Construction in Progress - 194,978 - - - 194,978
Buildings - 30,409,375 3,141,813 - - 33,551,188
Infrastructure - - 2,923,925 - - 2,923,925 '
Machinery and Equipment 8,188,109 - 3,486,925 - 160,002 1 1,835,036
Total Cost 8,188,109 30,604,353 9,552,663 - 160,002 48,505,127
Less Accumulated Depreciation (4,009,522) (8,564,1 19) (2,575,086) - (3,564) (15,152,291)
Net Capital Asscts 4,178,587 22,040,234 6,977,577 - 156,438 33,352,836 ,
Tota]Noncurrent Assets 4,368,587 22,04Q234 6,977,577 - 156,438 33,542,836
Total Assets $ 11,160,731 $ 29,181,289 $8,044,269 $ 1,482,200 $ 464,754 $ 50,333,243
LIABILITIES AND NET ASSETS ,
Current Liabilities
Accounts Payable $ 18,488 $ 27,450 $ - $ - $ 168,954 $ 214,892
Current Compensated Absences - - - 766,754 - 766,754 ,
Total Current Liabilities 18,488 27,450 - 766,754 168,954 981,646
Noncurrent Liabilities
Compensated Absences - - - 937,144 - 937,144
Total Liabilities 18,488 27,450 - 1,703,89A 168,954 1,918,790 '
Net Assets
Invested in Capital Assets,Net of
Related Debt 4,178,587 22,040,234 6,977,577 - 156,438 33,352,836 '
Unrestricted 6,963,656 7,]13,605 1,066,692 (221,698) 139,362 15,061,617
Tota]NetAssets 11,142,243 29,]53,839 8,044,269 (221,698) 295,800 48,414,453
Tota]Liabilities and '
NetAssets $ 11,160,731 $29,181,289 $8,044,269 $ 1,482,200 $ 464,754 $ 50,333,243
1
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92 ,
'
, CITY OF SHAKOPEE
COMBINING STATEMENT OF REVENUES,EXPENSES
AND CHANGES IN FUND NET ASSETS-
' INTERNAL SERVICE FUNDS
For the Year Ended December 31,2011
' Governmental Activities-Internal Service Funds
Information
Employee and
Equipment Buildings Park Assets Benefits Technology Total
' OPERATING REVENUES
Rental Charges $ 691,573 $ 1,204,957 $ 171,718 $ $ 260,021 $ 2,328,269
� OPERATING EXPENSES _
Employee Benefits 122,879 122,879
Materials and Supplies 32,532 307 226,676 259,515
Repairs and Maintenance - - 33,318 - 12,]16 45,434
' Professional Services � _ 168 - - 168
Utilities 305 305
Depreciation 565,383 797,007 370,451 6,107 1,738,948
Total Operating Expenses 565,383 829,539 404,549 122,879 244,899 2,167,249
, Operating Income(Loss) 126,190 375,418 (232,831) (122,879) 15,122 161,020
NONOPERATING REVENUES
' Investment[ncome 181,923 223,485 29,706 30,589 6,142 471,845
Gain(Loss)on Disposal of Assets 16,931 (22,910) (5,979)
Capital Grant - 46,501 - - - 46,501
Total Nonoperating Revenues 198,854 269,986 29,706 30,589 (16,768) 512,367
� Income(Loss)before Capital
Contributions and Transfers 325,044 645,404 (203,125) (92,290) (1,646) 673,387
' Transfers In 140,000 - 131,458 - 200,453 471,911
Transfers Out - (465,000) - (]25,000) - (590,000)
' Change in Net Assets 465,044 180,404 (71,667) (217,290) 198,807 555,298
NET ASSETS
' BeginningofYear 10,677,199 28,973,435 8,115,936 (4,408) 96,993 47,859,155
EndofYear $11,142,243 $29,153,839 $8,044,269 $ (221,698) $ 295,800 $48,414,453
t
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' 93
'
CITY OF SHAKOPEE �
COMBINING STATEMENT OF CASH FLOWS-
INTERNAL SERVICE FUNDS
For the Year Ended December 31,2011 '
lnYormation
Employee and
Equipment Buildings Park Asseu Benefits Technology Total '
CASH FLOWS-OPERATING ACTIVITIES
Receipts from Customers and Users $ 691,573 $ 1,205,857 $ 171,718 $ - $ 260,021 $ 2,329,169
Payments to Suppliers - (32,532) (34,098) - (95,291) (161,921)
Payments to Employees - - - (88,751) - (88,751) �
Net Cash Flows-Operating
Activities 691,573 1,173,325 137,620 (88,751) 164,730 2,078,497
CASH FLOWS-NONCAPITAL
FINANCING ACTIVITIES �
Transfer from Other Funds 140,000 - 131,458 - 200,453 471,91 1
Transferto Other Funds - (465,000) - (125,000) - (590,000)
Net Cash Flows-Noncapital
FinancingActivities 14Q000 (465,000) 131,458 (125,000) 20Q453 (118,089) ,
CASH FLOWS-CAPITAL AND RELATED
FINANC[NG ACTIVITIES
Intergovemmental Capital Grant - 46,501 - - - 46,501 '
Proceeds from Disposal of Capital Assets 26,43I - - - - 26,431
Acquisition of Capital Assets (142,723) (77,555) - - (145,736) (366,014)
Net Cash Flows-Capital and
Related Financing Activities (116,292) (31,054) - - (145,736) (293,082)
CASH H LOWS-INVESTING ACTiVITIFS '
Payment Received for Notes Receivablc 85,000 - - - - 85,000
Interest Received 185,587 216,942 28,334 34,647 5,255 470,765
Net Cash Flows-lnvesting '
Activities 270,587 216,942 28,334 34,647 5,255 555,765
Net Chan�e in Cash and Cash Equivalents 985,868 894,213 297,412 (179;104) 224,702 2,223,091
CASH AND CASH EQUIVALENTS '
Be�inning of Year 5,690,997 6,217,265 765,645 1,655,185 82,603 14,411,695
End of Year $6,676,865 $7,1 11,478 $ 1,063,057 $ 1,476,081 $ 307 305 $ 16,634,786
RECONCILIATION OF OPERATING ,
INCOME(LOSS)TO NET CASH
FLOWS-OPERATING ACTIVITIES
Operating Income(Loss) $ 126,190 $ 375,418 $ (232,831) $ (122,879) $ 15,122 $ 161,020 �
Adjustments to Reconcile Operating
Income(Loss)to Net Cash
Flows-Operating Activities:
Depreciation Expense 565,383 797,007 370,451 - 6,107 1,738,948
Changes in: '
Accounts Receivable - 900 - - - 900
Accounts Payable - - - - 143,501 143,501
Compensated Absences Payable - - - 34,128 - 34,128
Total Adjustments 565,383 797,907 3"I0,451 34,128 149,608 1,917,477 '
Net Cash Flows-Operating
Activities $ 691,573 $ 1,173,325 $ 137,620 $ (88,751) $ 164,730 $ 2,078,497
'
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94
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'
, CITY OF SHAKOPEE
STATEMENT OF FIDUCIARY NET ASSETS
' December 31, 2011
' Escrow Agency Southwest Metro Total Agency
Fund Drug Task Force Funds
' ASSETS
Cash and Investments $ 1,563,629 $ 715,778 $ 2,279,407
Receivables:
' Accounts Receivable = 9,379 9,379
Interest Receivable 2,790 2,790
Due from Other Governments - 39,128 39,128
' Total Assets $ 1,563,629 $ 767,075 $ 2,330,704
, LIABILITIES
Accounts Payable $ 2,777 $ 680,278 $ 683,055
' Deposits Payable 1,560,852 86,797 1,647,649
Total Liabilities $ 1,563,629 $ 767,075 $ 2,330,704
'
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' 95
'
CITY OF SHAKOPEE '
STATEMENT OF CHANGES IN ASSETS AND LIABILITIES-
AGENCY FUNDS '
For the Year Ended December 31,2011
Escrow Agency Fund ,
Balance at Balance at
December 31, December 31,
2010 Additions Deductions 2011 '
ASSETS
Current
Cash and Investments $ 1,749,597 $ 466,099 $ 652,067 $ 1,563,629 '
LIABILITIES
Accounts Payable $ 904 $ 585,192 $ 583,319 $ 2,777 '
Deposits Payable 1,748,693 912,072 1,099,913 1,560,852
Total Liabilities $ 1,749,597 $ 1,497,264 $ 1,683,232 $ 1,563,629 '
Southwest Metro Drug Task Force Agency Fund ,
Balance at Balance at
December 31, December 31, '
2010 Additions Deductions 2011
ASSETS
Current '
Cash and Investments $ 734,121 $ 345,506 $ 363,849 $ 715,778
Receivables:
Accounts Receivable 21,250 9,379 21,250 9,379 '
Interest Receivable 3,826 2,790 3,826 2,790
Due from Other Governments - 39,128 - 39,128
Total Assets $ 759,197 $ 396,803 $ 388,925 $ 767,075 '
LIABII,ITIES �
Accounts Payable $ 676,246 $ 385,453 $ 381,421 $ 680,278
Deposits Payable 82,951 103,334 99,488 86,797
Total Liabilities $ 759,197 $ 488,787 $ 480,909 $ 767,075 '
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' STATISTICAL SECTION
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� CITY OF SHAKOPEE
STATISTICAL SECTION
' December 31, 2011
, This part of the City's Comprehensive Annual Financial Report(CAFR)presents detailed information for
placing in context and understanding what the information shown in the financial statements,note
disclosures and required supplementary information reveals about the City's overall financial health.
'
CONTENTS Page
� Financial Trends 100
' These schedules show trend information to help the reader
understand how the City's financial performance and
well being have changed over time.
LRevenue Capacity 110
Porirayed is information to help the reader assess the
, City's most important local revenue source, the property taa�.
Debt Capacity 114
, These schedules present information to help the reader assess
the affordability of the City's current levels of outstanding
, debt and the City's ability to issue additional debt in the future.
Demographic and Economic Information 121
' Shown are demogaphic and economic indicators to help the
reader understand the environment within which the City's
� financial activities take place.
Operating Information 124
� These schedules shown service and infrastructure data to
help the reader understand how the information in the City's
financial report relates to the services the City provides
� and the activities it performs.
Source: Unless noted otherwise,the information in these schedules is from the CAFR for the relevant year.
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, 99
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CITY OF SHAKOPEE �
NET ASSETS BY COMPONENT
Years 2003 Through 2011 '
2003 2004 2005 2006 ,
Governmental Activities:
Invested in Capital Assets,
Net of Related Debt $ 94,388,758 $ 90,281,410 $ 111,237,672 $ 119,661,761
Resh-icted 15,231,314 29,731,412 21,638,112 12,998,982 '
Unrestricted 15,241,647 21,214,073 21,845,121 29,264,714
Total Governmental
Activities Net Assets $ 124,861,719 $ 141,226,895 $ 154,720,905 $ 161,925,457 �
Business-Type Activities:
Invested in Capital Assets, ,
Net of Related Debt $ 81,725,264 $ 89,415,817 $ 99,140,973 $ 109,337,014
Restricted 978,371 1,867,077 2,232,469 880,069
Unrestricted 38,234,063 37,354,576 41,291,469 42,400,797 '
Total Business-Type
Activities Net Assets $ 120,937,698 $ 128,637,470 $ 142,664,911 $ 152,617,880
Primary Government: '
Invested in Capital Assets,
Net of Related Debt $ 176,114,022 $ 179,697,227 $ 210,378,645 $ 228,998,775
Restricted 16,209,685 31,598,489 23,870,581 13,879,051 '
Unrestricted 53,475,710 58,568,649 63,136,590 71,665,511
Total Primary
Government Net Assets $ 245,799,417 $ 269,864,365 $ 297,385,816 $ 314,543,337 '
Note: The City began to report accrual information when it implemented GASB Statement
No. 34 in fiscal year 2003.
'
From 2003-2010, the SPUC Funds,Water and Electric Enterprise Funds,were reported as a
blended component unit of the City. In 2011, SPUC funds have been presented as discretely �
presented component units as it no longer met the criteria for blending.
'
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100 '
'
� Table 1
,
' 2007 2008 2009 2010 2011
$ 113,534,056 $ 112,909,793 $ 112,097,148 $ 111,905,152 $ 114,981,955
� 13,081,337 21,915,945 16,518,865 1,844,129 10,914,439
28,316,931 22,086,771 28,832,576 43,910,102 32,771,327
� $ 154,932,324 $ 156,912,509 $ 157,448,589 $ 157,659,383 $ 158,667,721
' $ 114,546,218 $ 115,124,238 $ 114,331,216 $ 115,064,968 $ 65,080,070
1,026,351 1,756,369 3,574,612 4,889,050 -
46,169,289 49,366,581 55,595,594 59,014,Q70 31,927,930
� $ 161,741,858 $ 166,247,188 $ 173,501,422 $ 178,968,088 $ 97,008,000
,
$ 228,080,274 $ 228,034,031 $ 226,428,364 $ 226,970,120 $ 180,062,025
� 14,107,688 23,672,314 20,093,477 6,733,179 10,914,439
74,486,220 71,453,352 84,428,170 102,924,172 64,699,257
$ 316,674,182 $ 323,159,697 $ 330,950,011 $ 336,627,471 $ 255,675,721
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101
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CITY OF SHAKOPEE '
CHANGES IN NET ASSETS
Years 2003 Through 2011 '
2003 2004 2005 '
EXPENSES:
Governmental Activities:
General Government $ 2,761,210 $ 3,135,421 $ 2,563,526
Public Safety 4,995,127 5,461,190 6,190,689 '
Public Works 3,673,623 6,036,920 8,298,258
Economic Development 683,035 360,167 314,858
Culture and Recreation 894,321 2,150,765 3,664,944
Other 668,531 861,864 924,270 �
Total Governmental Activities Expenses 13,675,847 18,006,327 21,956,545
Business-Type Activities: '
Electric 17,634,004 19,820,900 23,378,764
Water 2,337,860 2,723,003 2,460,977
Sewer 1,835,242 2,009,468 2,349,047
Storm 800,092 941,842 999,849 '
Tota] Business-Type Activities Expenses 24,]59,722 25,495,213 29,188,637
Total Primary Government Expenses $ 37,835,569 $ 43,501,540 $ 51,145,182
PROGRAM REVENUES: '
Governmental Activities:
Charges for Services:
General Government $ 1,706,644 $ 3,591,641 $ 791,504 �
Public Safety 2,408,012 3,446,465 3,462,283
Public Works 3,691,149 4,534,285 2,668,728
Economic Development - _ _ '
Culture and Recreation 1,330,062 1,497,853 1,826,847
Operating Grants and Contributions 2,622,953 4,303,581 3,646,605
Capital Grants and Contributions 11,009 - 8,666,283 '
Total Governmental Activities
Program Revenues 11,769,829 17,373,825 21,062,250
Business-Type Activities: '
Charges for Services:
Electric 19,733,990 22,161,542 27,425,921
Water 2,569,848 2,349,505 2,627,084 �
Sewer 2,827,777 3,078,191 2,971,601
Storm 1,947,139 1,806,974 1,937,430
Recreation 758,124 - _
Operating Grants and Contributions 2,345 - �
Capital Grants and Contributions 8,800,811 ]0,844,269 10,913,464
Total Business-Type Activities
Program Revenues 36,640,034 40,240,481 45,875,500 '
Total Primary Government
Program Revenues $ 48,409,863 $ 57,614,306 $ 66,937,750
Net(Expense)Revenue: '
Governmental Activities $ (1,906,018) $ (632,502) $ (894,295)
Business-Type Activities 12,480,312 14,745,268 16,686,863
Total Primary Government Net Expense $ 10,574,294 $ 14,112,'166 $ 15,792,568 �
102 '
�
� Table 2
�
2006 2007 2008 2009 2010 2011
'
$ 3,161,106 $ 3,543,980 $ 3,514,573 $ 3,388,268 $ 3,042,918 $ 4,252,887
1 6,856,485 8,301,075 8,346,104 8,528,413 9,123,316 9,236,767
6,798,917 15,264,606 8,099,384 7,860,080 8,397,874 7,094,047
333,462 363,805 522,074 316,566 427,169 244,361
4,653,240 5,323,087 3,637,527 3,859,670 3,765,660 3,866,307
� 896,110 1,042,133 1,033,999 1,040,044 784,824 619,099
22,699,320 33,838,686 25,153,661 24,993,041 25,541,761 25,313,468
, 29,169,297 34,710,974 36,186,676 30,140,842 32,700,410 -
2,949,990 3,332,132 3,461,261 3,316,102 3,293,079 -
2,786,234 2,938,955 3,308,759 3,398,117 3,685,417 3,807,322
� 1,523,343 1,352,078 1,435,376 1,264,261 1,792,749 1,382,391
36,428,864 42,334,139 44,392,072 38,119,322 41,471,655 5,189,713
$ 59,128,184 $ 76,172,825 $ 69,545,733 $ 63,112,363 $ 67,013,416 � 30,503,181
�
, $ 714,105 $ 583,247 $ 606,259 $ 680,681 $ 652,686 $ 721,180
2,063,023 1,650,235 1,506,680 1,677,772 1,716,573 1,503,188
2,986,495 2,615,402 2,354,276 1,342,173 941,224 478,788
� - - - - - 7,100
1,676,630 1,086,750 1,295,772 1,013,044 1,039,820 1,071,482
1,653,238 1,943,805 1,660,191 1,485,124 2,943,857 3,606,089
6,116,366 2,463,129 1,825,124 1,241,884 952,450 3,152,881
� 15,209,857 10,342,568 9,248,302 7,440,678 8,246,610 10,540,708
,
31,906,714 37,407,565 38,732,701 34,272,099 36,872,008 -
' 3,127,207 3,525,140 3,390,309 3,605,498 4,417,498 -
3,471,984 2,806,371 2,556,299 3,485,882 3,508,947 2,941,753
1,859,912 1,505,247 1,379,821 1,405,560 1,281,986 1,083,878
� - - - - 6,415 -
6,174,786 4,138,977 1,007,519 1,879,530 1,661,001 93,810
, 46,540,603 49,383,300 47,066,649 44,648,569 47,747,855 4,119,441
$ 61,750,460 $ 59,725,868 $ 56,314,951 $ 52,089,247 $ 55,994,465 $ 14,660,149
� $ (7,489,463) $ (23,496,118) $ (15,905,359) $ (17,552,363) $ (17,295,151) $ (14,772,760)
10,111,739 7,049,161 2,674,577 6,529,247 6,276,200 (1,070,272)
� $ 2,622,276 $ (16,446,957) $ (13,230,782) $ (]1,023,116) $ (11,018,951) $ (15,843,032)
' 103
�
CITY OF SHAKOPEE ,
CHANGES IN NET ASSETS
Years 2003 Through 2011 �
2003 2004 2005 '
GENERAL REVENUES AND OTHER
CHANGES IN NET ASSETS:
Governmental Activities:
Taxes: �
Property Taxes $ 7,995,002 $ 7,842,043 $ 9,341,977
Other Taxes 507,706 364,211 314,858
Unrestricted Investment Earnings 550,705 740,612 951,795 '
Gain on Disposal of Assets 69,623 294,833 746,340
Enterprise Fund Reclassed to
Special Revenue - 5,539,108 1,658,132
Transfers 443,651 2,215,871 1,375,203 '
Total Governmental Activities 9,566,687 16,996,678 14,388,305
Business-Type Activities: '
Investment Earnings 942,040 709,483 870,714
Gain on Disposal of Assets 9,260 409,918
SpecialItem - (5,539,108) (1,658,132)
Transfers (443,651) (2,215,871) (1,375,203) �
Total Business-Type Activities 507,649 (7,045,496) (1,752,703)
TotalPrimaryGovernment $ 10,074,336 $ 9,951,182 $ 12,635,602
Change in Net Assets: '
Government Activities $ 7,660,669 $ 16,364,176 $ 13,494,010
Business-Type Activities 12,987,961 7,699,772 14,934,160
Total Primary Government $ 20,648,630 $ 24,063,948 $ 28,428,170 '
Note: The City began to report accrual information when it implemented GASB Statement No. 34 in fiscal year 2003.
From 2003-2010,the SPUC funds,Water and Electric Enterprise Funds,were reported as a blended component �
unit of the City. In 2011,SPUC Funds have been presented as discretely presented component units as it
no longer met the criteria for blending.
'
1
i
1
1
1
l04 '
'
� Table 2(Continued)
'
2006 2007 2008 2Q09 2010 2011
1
' $ 10,547,177 $ 12,767,354 $ 14,200,833 $ 14,676,518 $ 14,229,111 $ 14,487,805
336,648 369,240 388,935 151,956 147,561 160,884
1,661,257 2,232,717 1,941,335 1,323,230 1,039,867 1,032,409
� 2,700 22,628 56,453 37,162 - -
' 2,146,233 1,111,046 1,297,988 1,899,577 2,089,406 100,000
14,694,015 16,502,985 17,885,544 18,088,443 17,505,945 15,781,098
, 1,973,715 3,185,863 3,128,741 1,336,979 1,279,872 758,182
13,749
' (2,146,233) (1,111,046) (1,297,988) (1,899,577) (2,089,406) (100,000)
(158,769) 2,074,817 1,830,753 (562,598) (809,534) 658,182
$ 14,535,246 $ 18,577,802 $ 19,716,297 $ 17,525,845 $ 16,696,411 $ 16,439,280
� $ 7,204,552 $ (6,993,133) $ 1,980,185 $ 536,080 $ 210,794 $ 1,008,338
9,952,970 9,123,978 4,505,330 5,966,649 5,466,666 (412,U90)
' $ 17,157,522 $ 2,130,845 $ 6,485,515 $ 6,502,729 $ 5,677,460 $ 596,248
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� 105
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CITY OF SHAKOPEE �
Table 3
FUND BALANCES-GOVERNMENTAL FUNDS
Last Ten Fiscal Years 1
2002 2003 2004 2005
General Fund: '
Nonspendable:
Prepaids $ _ $ _ g _ g _
Reserved - 79,003 13,586 16,465
Restricted for: '
BATC Litigation _ _ _ _
Committed to:
Working Capital _ _ �
Unreserved 3,534,080 5,565,816 7,233,268 9,662,677
Unassigned _ _ _ _
Total General Fund $ 3,534,080 $ 5,644,819 $ 7,246,854 $ 9,679,142
All Other Governmental Funds ,
Reserved:
Special Revenue Funds $ 1,456,237 $ 1,778,684 $ 2,232,061 $ 2,861,564 '
Debt Service Funds 7,653,349 6,369,303 10,837,684 9,236,020
Capital Projects Funds 6,818,306 7,088,887 17,088,803 9,915,610
Restricted for:
Forfeitures _ _ _ _ '
Transit - _ _
Telecomminication - _ _ _
SCDP Grant - _ _ _
Revolving Loans - _ _ _ �
Economic Development - _ _ _
Debt Service - _ _ _
CapitalImprovements - _ _ _ '
Committed to:
Working Capital - _ _ _
Transit - _ _ _
Revolving Loans - _ _ _ '
Economic Development - _ _ _
Park Projects - _ _ _
CapitalImprovements - _ _ _ �
2008 Projects - _ _ _
2009 Projects - _ _ _
2010 Projects - _ _ _
Fire Station 2 - _ _ _ �
Assigned to:
Capital Improvements - _ _ _
2010 Projects - _ _ _ '
Fire Station 2 _ _ _
Unreserved
Special Revenue Funds - - (4,971) -
Debt Service Funds - _ _ '
Capital Projects Funds (777,600) (705,537) (28,081) (1,833,937)
Unassigned - _ _ _
Total all Other
Governmental Funds $ 15,150,292 $ 14,531,337 $ 30,125,496 $ 20,179,257 '
Note: GASB Statement No. 54 was implemented in 2010.
Only 2010-2011 are reported in compliance with GASB Statement No. 54. 2002-2009 are reported as previously stated. �
106 �
�
' Table 3(Continued)
'
2006 2007 2008 2009 2010 2011
' $ - $ - $ - $ - 149,940 131447
,
1,490,157 1,810,650 1,126,074 799,276 - -
' - - - - 218,032 -
' - - - - 345,820 -
8,354,477 7,896,883 8,733,528 10,703,004
- - - - 8,323,938 9,172,747
$ 9,844,634 $ 9,707,533 $ 9,859,602 $ 11,502,280 $ 9,037,730 $ 9,304,194
'
, $ 3,386,721 $ 2,489,775 $ 2,738,909 $ 2,677,290 $ - - $ - _
7,930,114
8,082,799 3,849,703 4,873,440 4,185,059
' _ = = - 189,112 208,518
1,158,355 1,237,762
- - - - 49,192 45,681
' = = - = 55,743 22,462
143,023 249,147
447,319 497,775
- - - - 5,127,697 4,625,946
' - - - - 2,203,238 958,195
- - - - 345,820 -
- - - - 463,470 -
, - = - = 100,000 -
20,930
- - - - 1,785,164 -
' - = - - 3,616,689 -
190,431
14,876
- - - - 131,398 -
' - - - - 2,476,886 -
- - - - - 6,964,247
' - - - - - 128,871
284,357
- 993,555 1,130,452 - - -
' - 7,941,439 7,658,289 7,504,770 = -
(1,205,899) 1,673,762 1,994,812 2,453,383
- - - - (116,803) (484,089)
' $ 18,193,735 $ 16,948,234 $ 18,395,902 $ 16,820,502 $ 18,402,540 $ 14,738,872
'
' ]07
�
CITY OF SHAKOPEE '
Table 4
CHANGES IN FUND BALANCES-GOVERNMENTAL FUNDS
Last Ten Fiscal Years '
2002 7.003 20U4 2005
REVENUES: ,
Taxes $ 7,128,598 $ 7,991,699 $ 8,207,254 $ 9,621,721
Special Assessments 1,466,432 3,158,560 3,175,161 2,564,470
Licenses and Permits 3,814,646 4,748,457 4,173,804 4,444,491 '
Intergovernmental 5,230,607 2,612,877 4,162,581 3,646,605
Charges for Service 1,489,516 1,537,412 2,382,405 2,455,171
Fines and Forfeits 253,348 275,583 288,492 322,579 '
Miscellaneous 1,656,828 605,947 766,614 1,159,536
Total Revenues 21,039,975 20,930,535 23,156,311 24,214,573
EXPENDITURES: '
General Government 3,186,072 3,192,768 3,486,029 3,120,544
Police 3,014,829 3,148,785 3,698,352 4,159,724
Fire 889,390 975,656 1,141,700 1,194,610 '
Protective Inspection 555,384 645,030 690,920 855,864
Public Works 2,258,903 2,221,004 2,564,662 3,003,554
Culture and Recreation 622,099 669,570 2,489,749 2,792,590 ,
Economic Development _ _ _ _
Miscellaneous 109,455 317,167 - _
Debt Service: �
Principal 3,015,000 3,720,000 1,775,000 1,845,000
Interest and Other Charges 729,300 717,098 701,976 1,106,324
CapitalOutlay 9,249,946 5,532,652 7,432,575 14,058,508
Total Expenditures 23,630,378 21,139,730 23,980,963 32,136,718 �
Excess of Revenues
Under Expenditures (2,590,403) (209,195) (824,652) (7,922,145) �
OTHER FINANCING SOURCES
(USES): ,
Bonds Issued 4,938,612 2,215,567 15,070,000 -
Sale of Assets 9,644 41,761 299,183 753,024
Premium on Bonds Issued _ _ _ ,
Refunded Bond Escrow - - - (2,190,000)
Transfers In 1,701,837 1,732,872 5,963,741 3,374,566
Transfers Out (2,490,520) (2,289,221) (3,312,078) (1,529,396)
Total Other Financing Sources '
(Uses) 4,159,573 1,700,979 18,020,846 408,194
Net Change in Fund Balance $ 1,569,170 $ 1,491,784 $17,196,194 $ (?,513,951) �
Debt Service as a Percentage of
Noncapital Expenditures 26% 49% 18% 23% ,
'
l08 �
'
' Table 4 (Conrinued)
'
' 2006 2007 2008 2009 2010 2011
$ 10,815,367 $13,084,595 $14,437,766 $ 14,992,051 $ 14,385,788 $ 14,699,066
1,751,871 2,301,560 1,879,974 1,810,511 1,404,088 1,475,324
' 2,675,935 1,378,570 1,221,939 1,492,746 1,338,111 1,281,150
2,877,245 2,540,584 2,702,993 1,811,668 2,924,161 3,941,830
2,290,996 2,089,375 2,209,269 1,808,865 2,202,524 3,958,237
' 422,850 501,228 442,626 428,662 549,543 411,211
1,979,419 2,322,755 2,028,529 1,503,722 1,255,038 705,969
22,813,683 24,218,667 24,923,Q96 23,848,225 24,059,253 26,472,787
' 3,149,717 3,479,925 3,517,957 3,331,193 2,960,233 4,004 684
,
4,842,268 5,562,945 5,818,091 6,038,687 6,361,621 6,705,512
, 1,481,327 1,833,876 1,857,482 1,796,134 1,866,037 2,028,186
829,526 945,196 786,715 769,883 784,909 727,126
3,095,392 3,769,491 3,628,954 3,591,049 3,902,622 2,602,104
' 3,453,545 3,651,539 4,101,175 3,898,844 4,075,919 3,902,386
522,074 316,566 270,915 247,591
, 3,055,000 3,110,000 3,280,000 2,660,000 3,800,000 2,565,000
1,195,618 1,025,868 1,077,711 1,077,325 833,245 658,265
� 10,650,449 7,288,033 3,300,942 1,797,299 2,812,488 6,301,406
31,752,842 30,666,873 27,891,101 25,276,980 27,667,989 29,742,260
� (8,939,159) (6,448,206) (2,968,005) (1,428,755) (3,608,736) (3,269,473)
' 3,440,000 2,815,000 2,170,000 - 1,555,000 -
2,700 17,700 - - 6,000 -
' 20,275 9,956 16,741 = _ _
6,683,532 4,411,281 4,605,693 4,958,133 13,199,807 2,968,919
� (3,354,364) (2,188,333) (2,224,632) (3,462,100) (12,380,403) (2,750,830)
6,792,143 5,065,604 4,567,742 1,496,033 2,380,404 218,089
� $ (2,147,016) $(1,382,602) $ 1,599,737 $ 67,278 $ (1,228,332) $ (3,051,384)
' 27% 20% 20% 18% 22% 16%
'
' 109
,
C1TY OF SHAKOPEE �
Table 5
TAX CAPACITY AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY
Last Ten Fiscal Years
Taxable Tax '
Estimated Capaciry as a
Commercial Less: Less Net Net Taxable Total Taxable Percentage of '
Fiscal Residential Indush-ial Other Tax Increment Fiscal Tax Direct Market Estimated
Year Property Property Property Property Disparities Capaciry Tax Rate Value Market Value
2002 $11,469,272 $10,023,762 $ 409,721 $ 975,773 $ 1,543,453 $ 19,383,529 033976 $1,743,136,300 1.11%
2003 13,890,536 10,452,944 589,540 497,860 2,035,749 22,399,411 033939 2,062,115,200 1.09% '
2004 16,721,302 10,609,240 913,912 497,255 2,121,170 25,626,029 032433 2,464,564,300 1.04%
2005 20,394,086 11,749,438 528,300 327,963 2,132,628 30,211,233 0.31115 2,654,161,900 L14% ,
2006 23,162,320 ]2,710,783 565,215 352,543 1,615,190 34,470,585 0.30974 2,987,657,400 ].15%
2007 26,817,616 14,013,644 675,479 378,593 1,963,379 39,164,767 031939 3,419,040,600 1.15% '
2008 24,942,078 15,426,355 741,679 411,490 1,R46,919 43,851,703 031925 3,800,795,500 1.15%
2009 29,805,971 16,088,685 1,319,935 156,799 1,862,715 45,195,077 0.32630 3,850,591,200 1.17% '
2010 27,805,069 16,459,872 1,279,807 151,914 ],584,552 43,808,282 0.33710 3,710,814,056 1.18°,/0
20]1 24,652,932 18,351,835 1,304,688 161,430 1,630,522 42,517,503 034731 3,570,069,500 1.19% '
Source:Scori('ounty Auditor
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110 ,
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' CITY OF SHAKOPEE
Table 6
DIRECT AND OVERLAPPING PROPERTY TAX RATES
' Last Ten Fiscal Years
City Direct Rate General
' Obligation
Shakopee Debt Service
Fiscal Operating Debt Service Total Direct School Scott Other Market Value
' _Year Rate Rate Rate District County Jurisdictions Rate
2002 0.33194 0.00782 0.33976 0.26080 0.39517 0.04976 0.00764
, 2003 0.33172 0.00767 033939 0.24168 038554 0.05685 0.01393
' 2004 0.31131 0.01302 032433 0.21517 0.36635 0.04123 0.01189
2005 0.29855 0.01260 0.31115 0.25215 035361 0.04660 0.00969
, 2006 0.28996 0.01978 0.30974 0.27789 0.34974 0.04578 0.00848
2007 0.29822 0.02117 0.31939 0.27132 0.33140 0.04434 0.00728
, 2008 0.29874 0.02051 031925 0.26103 0.32646 0.04642 0.00537
� 2009 030401 0.02229 0.32630 0.27274 0.32684 0.04960 0.00651
2010 0.32152 0.01558 0.33710 0.29050 0.33240 0.04980 0.00651
� 2011 0.32996 0.01735 0.34731 0.31182 0.35541 0.05020 0.00342
5ources: Scott County Auditor and Leauge of Minnesota Cities Reports
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CITY OF SHAKOPEE ,
Table 7
PRINCIPAL TAXPAYERS
Current Year and Nine Years Ago
2011 2002 ,
Percentage Percentage
2010/11 ofTotal 2001/2002 ofTotal '
Tax Cap. Tax Cap. Tax Cap. Tax Cap.
Taxpayer Typeofl3usiness Value Rank Value Value Rank Value
ExcelEnergy ElectricalGeneration $ 537,082 1 126% $ 593,160 6 2.71%
Rahr Malting Grain Processing 407,838 2 0.96% 600,390 5 2.74% '
Seagate Manufacturing/Research 399,250 3 0.94"/0 1,498,500 1 6.84%
St.Francis RMC Health Care 358,500 4 0.84% ,
Shakopee Crossing LTD Retail 357,420 5 0.84%
Ryan Mpls II LL,C Property Management 332,700 6 0.78% ,
Canterbury Park Horse Racing 324,236 '7 0.76%
Certainteed Manufacturing 319,250 8 0.75°/a '
Shakopee Valley Market Retail 315,750 9 0.74%
Walmart Retail 315,250 10 0.74% ,
ADC Teleco�nmunications Electronics 890,024 2 4.06%
OIRE Property Management 861,828 3 3.93% �
KMart Warehouse Warehouse/Distribution Center 649,000 4 2.96%
Principal Mutual Mortgage Financial 557,756 7 2.55% �
Anchor Glass Manufacturing 327,172 8 1.49%
Valley Fair Amusement Park 254,450 9 1.16% �
Continenta195 Retail 193,256 10 0.88°/o
$ 3,667,276 8.63% $ 6,425,536 29.32°./0 '
Source: Scott County Auditor
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112 �
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' CITY OF SHAKOPEE
Table 8
PROPERTY TAX LEVIES AND COLLECTIONS
Last Ten Fiscal Years
' Ratio of
Accumulated
Percentage Delinquent
' Collections Percentage Collections of Total Accumulated Taxes to
Year Ta�c of Current of Lery of Prior Total Collections Delinquent Current
Collected Levy Years Taxes Collected Years Taxes Collections To Tax L,evy Taxes Years Taxes
� 2002 $ 6,645,713 $ 6,484,920 98% $ 41,342 $ 6,526,262 98% $ 70,622 1.06%
2003 7,889,018 7,191,567 91% 47,055 7,238,622 92% 79,710 1.01°,/0
� 2004 8,625,695 7,878,618 91% (86,619) 7,791,999 90% 175,774 2.04%
2005 9,703,206 9,025,261 93% 67,187 9,092,448 94% 164,517 1.70%
, 2006 10,951,917 9,945,490 91% 38,986 9,984,476 91% 279,316 2.55%
2007 12,745,449 12,418,768 97% 91,200 12,509,968 98% 331,315 2.60%
' 2008 14,222,007 13,661,366 96% 208,470 13,869,836 98% 483,317 3.40%
2009 14,983,677 14,457,378 96% 157,920 14,615,298 98% 319,740 2.13%
' 2010 14,918,665 13,971,356 94% 55,020 14,026,376 94% 310,624 2.08%
2011 14,837,438 14,019,831 94% 278,981 ]4,298,812 96% 26q248 1.75%
, Source:Scott County Auditor
1. The above data does not include tax increment districts.
2. The State of Minnesota cancelled$561,000 in 2003 to 2006,$243,439 in 2008,$511,956 in 2009,$558,860 in 2010 and$595,572 of
' annua]aid payments to the City that were part of the tax levy.
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� 113
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CITY OF SHAKOPEE '
Table 9
RATIO OF OUTSTANDING DEBT BY TYPE
Last Ten Fiscal Years '
Governmental Activities '
G.O. Revenue Business-type
Tax Special Activities Total Percentage
Fiscal G.O. Increment Assessment Revenue Primary of Personal Per
Year Bonds Bonds Bonds Bonds Government Income Capita �
2002 $ 2,565,000 $ 390,000 $ 14,055,000 $ 25,660,000 $ 42,670,000 5.5% 1,785
2003 2,445,000 - 13,060,000 25,215,000 40,720,000 5.0% 1,631 �
2004 10,595,000 - 18,205,000 25,515,000 54,315,000 5.5% 1,879
2005 8,275,000 - 16,360,000 24,750,000 49,385,000 4.4% 1,593 ,
2006 7,950,000 - 17,070,000 34,535,000 59,555,000 4.9% 1,816 '
2007 7,560,000 - 17,165,000 33,895,000 58,620,000 4.5% 1,752
2008 7,165,000 - 16,450,000 33,225,000 56,840,000 4.1% 1,689 '
2009 6,755,000 - 14,200,000 22,235,000 43,190,000 4.1% 1,276
2010 6,340,000 - 12,370,000 21,470,000 40,180,000 3.4% 1,084 ,
2011 5,905,000 - 10,240,000 - 16,145,000 1.3% 428 ,
Sources: See Table 14 for income and population data.
Note: From 2003-2010,the SPUC Funds,Water and Electric Enterprise Funds, were reported as a blended '
component unit of the City. In 2011, SPUC Funds have been presented as discretely presented component
units as it no longer met the criteria for blending.
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114
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' CITY OF SHAKOPEE
Table 10
RATIOS OF GENERAL BONDED OUTSTANDING
� Last Ten Fiscal Years
, Percentage of Percentage of
Actual Taxable Total
Fiscal G.O. Value of Per Personal
' Year Bonds Property Capita Income
2002 $ 2,565,000 0.15% 107 0.33%
� 2003 2,445,000 0.12% 98 0.30%
' 2004 10,595,000 0.43% 366 1.07%
2005 8,275,000 0.31% 267 0.76%
' 2006 7,950,000 0.27% 242 0.65%
' 2007 7,560,000 0.22% 226 0.61%
� 2008 7,165,000 0.19% 213 0.52%
2009 6,755,000 0.18% 199 0.65%
' 2010 6,340,000 0.17% 171 0.54%
� 2011 5,905,000 0.17% 157 0.49%
Sources:
, 1. Metropolitan Council estimated for population.
2005-2009 populations are the City's estimate.
2. Scott County Auditor
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, CITY OF SHAKOPEE
Table 11
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
, December 31, 2011
� Percentage Amount
Applicable Applicable
G.O. To City of To City of
' Debt Shakopee(1) Shakopee
Direct Debt:
, City of Shakopee $ 16,145,000 100.0% $ 16,145,000
, Overlapping Debt:
Independent School District No. 720 143,855,000 85.0% 122,276,750
Independent School Distnct No. 191 101,350,000 6.8% 6,891,800
' Scott County 76,805,000 29.4% 22,580,670
Metropolitan Council 1,349,552,846 1.0% 16,101,382
Total Overlappmg Debt: 1,671,562,846 167,850,602
' Total Direct and Overlapping Debt $ 1,687,707,846 $ 183,995,602
' Source: Scott County Auditor
Dakota County Auditor
Metropolitan Council
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Note: Overlapping governments are those that coincide, at least in part, with geographic boundaries of the
� City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is
borne by the residents and businesses of the City. This process recognizes that, when considering the City's
ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses
, should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore
responsible for repaying the debt of each government.
� (1) The percentage of overlapping debt is estimated using tax capacity. Applicable percentages were
estimated by determining the portion of Scott County's tax capacity that is within the City's boundaries and
, dividing it by Scott County's total tax capacity.
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CITY OF SHAKOPEE '
Table 12
LEGAL DEB'I'MARGIN INFORMATION
Last Ten Fiscal Years '
2002 2003 2004 2005 �
Market Value(Taxable) $ 1,743,136,300 $ 2,062,115,200 $ 2,464,564,300 $ 2,654,161,900
Debt Limit-Percent of '
Market Value(Note A) 34,862,726 41,242,304 49,291,286 53,083,238
Amount of Debt Applicable ,
to Debt Limit:
G.O.Bonds 2,565,000 2,445,000 10,595,000 8,275,000
Available in Debt Service ,
Funds (284,119) (297,657) (2,539,292) (1,155,148)
Total Debt Applicable
to Debt Limit 2,280,881 2,147,343 8,055,708 7,119,852
Legal Debt Margin $ 32,581,845 $ 39,094,961 $ 41,235,578 $ 45,963,386 �
NOTE(A): �
M.S.A. Section 475.53 (Limit on Net Debt)
Subdivision 1. Generally,except of otherwise provided in Sections 475.51 to 475.75,no municipality,except a
school district or a city of the first class,shall incur or be subject to a net debt in excess of 2% �
(3%starting 2008)of the market value of taxable property in the municipality."
NOTE(B): ,
M.S.A. Section 475.51 Definitions: Subdivision 4. "Net debt"means the amount remaining after deduction
from its gross debt the aggregate of the principal of the following:
(1) Obligations issued for improvements which are payable wholly or partly from the proceeds of special '
assessments levied upon property specially benefited thereby,including those which are general obligations
of the municipality issuing them,if the municipality is entitled to reimbursement in whole or in part from
the proceeds of the special assessments. �
(2) Warrants or orders having no definite or fixed maturity.
(3) Obligations payable wholly from the income of revenue-producing conveniences.
(4) Obligations issued to create or maintain a permanent improvement revolving fund. ,
(5) Obligation issaed far the acyuisition,and betterment of public waterworks systems,and public lighting,
heating or power systems and on any combination thereof ar for any other public convenience from
which a revenue is or may be derived. '
(6) Amount of all money and the face value of all securities held as a sinking fund for the extinguishment
of obligations other than those deductible under this subdivision.
M.S.A. Section 469.178, subdivision 1. (tax increment bonds)"...The bonds are not included for purposes '
of computing the net debt of any municipality.
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` Table 12(Continued)
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2006 2007 2008 2009 2010 2011
, $2,987,657,400 $ 3,419,040,600 $3,800,795,500 $ 3,850,591,200 $3,710,814,056 $ 3,570,069,500
, 59,753,148 68,380,812 114,023,865 115,517,736 111,324,422 107,102,085
� 7 950 000 7 560 000 7 165 000
, , > , > , 6,755,000 6,340,000 5,905,000
' (810,494) (834,155) (847,608) (837,100) (786,306) (826,957)
7,139,506 6,725,845 6,317,392 5,917,900 5,553,694 5,078,043
i $ 52,613,642 $ 61,654,967 $ 107,706,473 $ 109,599,836 $ 105,770,728 $ 102,024,042
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CITY OF SHAKOPEE '
Table 13
PLEDGED REVENUE COVERAGE
Last Ten Fiscal Years �
Utility Bonds ,
Utility Less: Net
Fiscal Service Operating Available Debt Service
Year Charges Expense Revenue Principal Interest Coverage '
2002 $ 21,148,771 $ 16,343,532 $ 4,805,239 $ 340,000 $ 1,468,242 2.66
2003 22,871,121 17,585,831 5,285,290 580,000 1,348,883 2.74 �
2004 25,473,439 19,778,149 5,695,290 640,000 1,307,626 2.92 '
2005 33,841,730 25,821,489 8,020,241 765,000 1,074,487 4.36
2006 38,445,403 31,436,969 7,008,434 785,000 1,174,711 3.58 i
2007 44,692,049 36,644,414 8,047,635 640,000 1,574,925 3.63 �
2008 45,499,791 38,689,351 6,810,440 670,000 1,523,198 3.11
2009 42,437,910 33,009,500 9,428,410 710,000 1,012,874 5.47 '
2010 45,586,795 36,375,440 9,211,355 765,000 939,426 5.40
2011 - - - - - - �
1. Operating expense excludes depreciation and amortization. ,
Note: From 2003-2010, the SPUC Funds,Water and Electric Enterprise Funds,were reported
as a blended component unit of the City. In 2011, SPUC Funds have been presented as �
discretely presented component units as it no longer met the criteria for blending.
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' CITY OF SHAKOPEE
Table 14
DEMOGRAPHIC AND ECONOMIC STATISTICS
' Last Ten Calendar Years
Fiscal School Unemployment Total Per Capita Personal
� Year Population(1) Enrollment(2) Rate(3) Employment Income(4) Income(5)
2002 23,900 4,487 4.0% 15,024 $ 32,575 $ 778,542,500
� 2003 24,967 4,790 4.3% 15,887 32,760 817,918,920
M2004 28,913 5,121 3.9% 16,213 34,284 991,253,292
2005 31,000 6,247 3.6% 16,192 35,956 1,114,636,000
� 2006 32,800 6,643 3.7°/a 17,787 37,023 1,214,354,400
2007 33,460 6,905 4.6% 18,225 39,042 1,306,345,320
� 2008 33,660 7,163 6.7% 18,688 31,900 1,375,044,660
, 2009 33,860 7,465 7.8% 18,926 30,900 1,046,274,000
2010 37,076 7,814 7.0% 18,771 31,700 1,175,309,200
' 2011 37,721 8,115 4.6% 20,718 32,017 1,207,713,257
' Source: 1. Metropolitan Council population estimates except for 2010 which is the official
census figure. 2005-2009,2011 are the City's estimate.
2. Shakopee School District,SACS,Bloomington Lutheran
3. Minnesota Department of Employment and Economic Development
� 4. Bureau of Economic Analysis and MET Council Community Profile Dad
5. Per capita income times population
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Table 15
PRINCIPAL EMPLOYERS
Current Year and Nine Years Ago
r
2��� 2��2
Total Total
� City Ciry
Taxpayer Type of Business Employees Rank Employment Employees Rank Employment
ADC Manufacturing 0.00% 1,400 I 9.32%
� Valley Fair Amusement Park 1,743 1 8.41% 1,200 2 7.99%
School Dishict No.720 Education 1,347 2 6.50% 390 6 2.60%
, Seagate Manufacturing/Research 1,200 3 5.79% ],200 3 7.99%
Canterbury Park Horse Racing 1,100 4 5.31%
� St.Francis RMC Health Care 804 5 3.88% 365 7 2.43%
Scott County Govemment 711 6 3.43%
' Imagine Print Solutions Pnnring 652 7 3.15%
Walmart Retail 400 8 1.93%
� Anchor Glass Glass Container Manufacturing 271 9 131% 285 9 1.90%
' TORO Manufacturing 270 10 1.30% 270 10 1.80%
American Color-SVP Printing 415 5 2.76%
' CertainTeed Roofing Manufacturing 300 8 2.00%
Kmart Distribution Center 420 4 2.80%
� 8,498 35.11% 6,245 45.01%
Tota]Employment 20,718 15,024
� Source: Minnesota Department of Employment and Economic Development.
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CITY OF SHAKOPEE '
Table 16
FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES
BY FUNCTION/PROGRAM �
Last Ten Fiscal Years
2002 2003 2004 2005 2006 �
General Government:
Administration 6 6 6 6 6 �
City Clerk 3 4 4 4 4
Finance 4 3 3 3 3
Planning 6 6 S 5 5 '
Facilities Maintenance 1 1 4 4 6
Information Technology 1 1 2 2 2
Public Safety: '
Police:
Licensed 34 34 40 42 45 '
Other 7 7 7 9 7
Fire:
Full time - - - _ _ �
Paid On Call 50 50 50 50 48
Building Inspection 7 7 8 g g '
Public Works:
Engineering 9 9 9 9 9 '
Street 9 9 11 12 12
Shop 2 3 3 3 3
Park and Recreation: `
Park Maintenance 7 7 7 7 7
Recreation 8 8 8 10 10 ,
Total 154 155 167 174 175
Source: City departments a
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� Table 16 (Continued)
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, 2007 2008 2009 2010 2011
� 5 5 5 5 5
4 4 4 4 4
3 3 3 3 3
� 5 5 5 5 5
6 7 6 6 6
2 2 2 2 2
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f46 47 47 47 50
7 6 6 6 6
� 1 2 3 3 3
48 48 44 44 42
� 7 6 5 5 5
� 7 7 7 7 7
12 13 13 13 13
3 3 3 3 4
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8 8 8 8 8
� 10 7 7 7 7
174 173 168 168 170
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CITY OF SAAKOPEE �
Table 17
OPERATING INDICATORS BY FUNCTION/PROGRAM
Last Ten Fiscal Years �
2002 2003 2004 2005 2006 '
General Government
Planning
Number of Case Files 121 127 109 120 91
Number of Plats Filed 10 11 9 7 10 �
Number of Acres Platted 378 385 238 321 155
Public Safety '
Police
Airests 1,348 1,147 1,248 1,451 1,770
Citations 3,805 3,129 3,802 3,843 4,970 �
Calls for Service 13,939 14,799 16,062 17,363 18,333
Fire
Calls for Service 446 482 479 539 494
Building Inspection �
Building Permits Issued 1,310 1,744 1,638 1,512 1,131
Number of Inspections 11,416 15,016 14,535 15,]75 9,671
Single Family Homes Permitted 260 384 396 352 223 �
Public Works
Street �
Miles of Roadway 131 138 114 123 153
Park and Recreation �
Park Maintenance
Acres Maintained 655 671 760 925 930
Recreation
Program Participants 9,911 10,194 9,693 9,842 9,928 '
Community Center Members 520 556 541 516 578
Community Center Admissions 70,088 77,014 75,018 77,543 91,776
Source: City departments ,
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2007 2008 2009 2010 2011
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67 68 35 33 24
I 3 2 2 1 2
38 50 34 6 68
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2,199 1,881 1,913 1,962 1,666
, 6,073 4,058 6,127 5,528 5,647
19,606 19,057 17,909 17,831 15,832
609 538 517 557 600
� 1,194 1,019 1,102 1,083 1,881
8,174 5,946 9,726 8,048 8,004
� 138 94 314 160 118
� 154 154 154 154 154
� 930 933 933 933 933
� 10,847 11,410 10,377 13,001 13,157
597 6l3 823 2,534 3,682
100,044 100,397 109,257 117,336 120,667
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Table 18
CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM
Last Ten Fiscal Years �
2002 2003 2004 2005 2006 i
Police:
Stations 1 1 1 1 1 �
Patrol Zones 4 4 4 4 4
Patrol Units 12 12 13 13 15
Fire Stations 2 2 2 2 2 ,
Street: �
Miles of Roadway 131 138 114 123 153
Traffic Signals 21 23 25 25 25
Parks: �
Acres 655 671 760 925 1,015 �
Ball Fields 42 42 46 46 47
Playgrounds 12 13 13 13 18
Source: City Departments �
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� 2007 2008 2009 2010 2011
� 1 1 1 1 1
4 4 4 4 4
15 15 15 15 15
� 2 2 2 2 2
' 154 154 154 154 154
25 26 27 27 27
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� 1,015 1,019 1,024 1,024 1,024
47 49 49 52 54
22 24 24 24 26
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Scott County, Minnesota
REPORTS ON COMPLIANCE WITH
' GOVERNMENT A UDITING STANDARDS
AND MINNESOTA LEGAL COMPLIANCE
' For the Year Ended December 31, 2011
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, CITY OF SHAKOPEE
TABLE OF CONTENTS
, REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN
' AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE
WITH GOVERNMENT A UDITING STANDARDS.................................................................... 1
' REPORT ON LEGAL COMPLIANCE........................................................................................ 3
SCHEDULE OF FINDING AND RESPONSE ON INTERNAL CONTROL .......................... 4
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' REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN
AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE
' WITH GOVERNMENT A UDITING STANDARDS
' Honorable Mayor and Members
of the City Council
City of Shakopee
' Shakopee, Minnesota
� We have audited the financial statements of the governmental activities, the business-type activities,
each major fund and the aggregate remaining fund information of the City of Shakopee, Minnesota, as
of and for the year ended December 31, 2011, which collectively comprise the City's basic financial
statements and have issued our report thereon dated April 25, 2012. We conducted our audit in
� accordance with U.S. generally accepted auditing standards and the standards applicable to financial
audits contained in Governrnent Auditing Staradards, issued by the Comptroller General of the United
States.
IINTERNAL CONTROL OVER FINANCIAL REPORTING
� The management of the City is responsible for establishing and maintaining effective internal control
over financial reporting. In planning and performing our audit, we considered the City's internal control
over financial reporting as a basis for designing our auditing procedures for the purpose of expressing
' our opinions on the financial statements but not for the purpose of expressing an opinion on the
effectiveness of the City's internal control over financial reporting. Accordingly, we do not express an
opinion on the effectiveness of the City's internal control over financial reporting.
� A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent or
detect misstatements on a timely basis. A material weakness is a deficiency, or combination of
� deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of
the financial statements will not be prevented or detected and corrected on a timely basis.
' Our consideration of the internal control over financial reporting was for the limited purpose described
in the first paragraph of this section and was not designed to identify a11 deficiencies in the internal
control that might be deficiencies, significant deficiencies or material weaknesses. We did not identify
, any deficiencies in internal control over financial reporting that we consider to be material weaknesses
as defined above. However, we identified a certain deficiency in internal control over financial
reporting, described in the accompanying Schedule of Finding and Response on Internal Control that we
consider to be a significant deficiency in internal control over financial reporting, listed as Audit Finding
' 10-01. A significant deficiency is a deficiency, or combination of deficiencies, in internal control that is
less severe than a material weakness, yet important enough to merit attention by those charged with
governance.
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' COMPLIANCE AND OTHER MATTERS
' As part of obtaining reasonable assurance about whether the City's basic financial statements are free of
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts and grant agreements, noncompliance with which could have a direct and material effect on
the determination of financial statement amounts. However, providing an opinion on compliance with
' those provisions was not an objective of our audit and, accordingly, we do not express such an opinion.
The results of our tests disclosed no instanc.es of noncompliance or other matters that are required to be
reported under Government Auditing Standards.
' We noted certain additional matters that we reported to management of the City in a separate letter dated
April 25, 2012.
� The City's response to the finding identified in our audit is described in the accompanying Schedule of
Finding and R�sponse on Internal ControL We did not audit the City's response and, accordingly, we
' express no opinion on it.
This report is intended solely for the information and use of the City Council, management and state and
federal awarding and oversight agencies and is not intended to be and should not be used by anyone
' other than those specified parties.
��.�., De c,v,��, V-� (.hP_
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' Bloomington, Minnesota
April 25, 2012
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' REPORT ON LEGAL COMPLIANCE
'
' Honorable Mayor and Members
of the City Council
City of Shakopee
� Shakopee, Minnesota
� We have audited the financial statements of the governmental activities, the business-type activities and
each major fund and the aggregate remaining fund information of the City of Shakopee, Minnesota, for
the year ended December 31, 2011, which collectively comprise the City's basic financial statements
and have issued our report thereon dated April 25, 2012.
, We conducted our audit in accordance with U.S. generally accepted auditing standards and the
provisions of the Minnesota Legal Compliance Audit Guide for Political Subdivisions, promulgated by
� the State Auditor pursuant to Minnesota Statutes Sec. 6.65. Accordingly, the audit included such tests of
the accounting records and such other auditing procedures as we considered necessary in the
circumstances.
� The Minnesota Legal Compliance Auclit Guide for Political Subdivisions covers seven categories of
compliance to be tested: contracting and bidding, deposits and investments, conflicts of interest,public
' indebtedness, claims and disbursements, miscellaneous provisions and Tax Increment Financing. Our
study included all of the listed categories.
The results of our tests indicate that for the items tested, the City complied with the material terms and
' conditions of applicable legal provisions.
This report is intended solely for the information and use of the City Council, management and the
� Office of the State Auditor, and is not intended to be and should not be used by anyone other than those
specified parties.
' J���t,,,,, De(iv,e-��, V-�i (.�-
� KERN, DEWENTER, VIERE, LTD.
Blooinington, Minnesota
April 25, 2012
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' CITY OF SHAKOPEE
SCHEDULE OF FINDING AND RESPONSE ON INTERNAL CONTROL
' December 31, 2011
LACK OF SEGREGATION OF ACCOUNTING DUTIES
� Adequate segregation of accounting duties is in place when the four areas of a transaction have been
separated: authorization, custody,recording and reconciliation.
iManagement is aware of this condition and has taken certain steps to compensate for the lack of
segregation but due to the small staff needed to handle all of the accounting duties, the costs of obtaining
' desirable segregation of accounting duties often exceeds benefits which could be derived. However,
management must remain aware of this situation and should continually monitor the accounting system,
including changes that occur.
' Management's Response:
The auditors recognize that with the City's limited number of employees, this will most likely remain as
' a significant deficiency. The City continues to analyze personnel responsibilities in an attempt to
provide for enhanced controls and to mitigate control risks.
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' CITY OF SHAKOPEE
Scott County, Minnesota
� MANAGEMENT LETTER
For the Year Ended December 31,2011
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TABLE OF CONTENTS
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REPORT ON MATTERS IDENTIFIED AS A RESULT OF
' THE AUDIT OF THE FINANCIAL STATEMENTS............................................................... 1
SIGNIFICANT DEFICIENCY....................................................................................................... 3
' DEFICIENCIES............................................................................................................................... 4
REQUIRED COMM�.INICATION................................................................................................ 5
, FINANCIAL ANALYSIS................................................................................................................ 8
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' REPORT ON MATTERS IDENTIFIED AS A RESULT OF
THE AUDIT OF THE FINANCIAL STATEMENTS
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, Honorable Mayor and Members
of the City Council
City of Shakopee
Shakopee, Minnesota
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In planning and performing our audit of the financial statements of the City of Shakopee, Minnesota, as
, of and far the year ended December 31, 2011, in accordance with U.S. generally accepted auditing
standards and Government Auditing Standards, we considered the City's internal control over financial
reporting (internal control) as a basis for designing our auditing procedures for the purpose of expressing
' our opinion on the financial statements, but not for the purpose of expressing an opinion on the
effectiveness of the City's internal control. Accordingly, we do not express an opinion on the
effectiveness of the City's internal control.
' Our consideration of internal control was for the limited purpose described in the preceding paragraph
and would not necessarily identify all deficiencies in internal control that might be deficiencies,
significant deficiencies or material weaknesses and, therefore, there can be no assurance that all
' deficiencies, significant deficiencies or material weaknesses have been identified. Material weaknesses
and significant deficiencies identified, if any, are stated within this letter.
' A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent ar
detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination
' of deficiencies in internal control, such that there is a reasonable possibility that a material misstatement
of the City's financial statements will not be prevented or detected and corrected on a timely basis.
' A significant deficiency is a deficiency, or combination of deficiencies, in internal control that is less
severe than a material weakness, yet important enough to merit attention by those charged with
governance.
' The accompanying memorandum includes financial analysis and recommendations for improvement of
accounting procedures and internal control measures that came to our attention as a result of our audit of
the financial statements of the City for the year ended December 31, 2011. The matters discussed herein
, were considered by us during our audit and they do not modify the opinion expressed in our Independent
Auditor's Report dated April 25, 2012, on such statements.
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' This communication is intended solely for the information and use of management, the City Council,
others within the City and state oversight agencies and is not intended to be and should not be used by
, anyone other than these specified parties.
�I%�t^^� ��t-w�1-4., V�c.P..�� �•
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' April 25, 2012
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SIGNIFICANT DEFICIENCY
' December 31, 2011
LACK OF SEGREGATION OF ACCOUNTING DUTIES
' Adequate segregation of accounting duties is in place when the four areas of a transaction have been
separated: authorization, custody, recording and reconciliation. During 2011, the City did not have
' sufficient staffto segregate the duties listed above. Specific areas where this is a lack of internal
controls includes (but is not all-inclusive):
, Payroll
The Payroll Clerk processes payroll, posts payroll to the general ledger, issues direct deposits,
prepares the payroll taxes, initiates transfers for payment of payroll, prepares all W-2s and maintains
� all data files as well as the payroll program.
Cash Receipts
Deposits at City Hall—The front desk personnel receives money, codes the revenue and prepares
� bank deposits. The Accountant reconciles cash and posts all deposits into the general ledger.
Deposits at Recreation Center—One employee is able to receipt money and prepare the bank
� deposit.
Cash Disbursements
' The Accounting Clerk enters invoices, matches purchase orders to invoices and prepares checks for
payment.
� Management is aware of this condition and has taken certain steps to compensate for the lack of
segregation but due to the small staff needed to handle all of the accounting duties, the costs of obtaining
desirable segregation of accounting duties often exceeds benefits which could be derived. However,
management must remain aware of this situation and should continually monitor the accounting system,
' including changes that occur.
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CITY OF SHAKOPEE '
DEFICIENCIES
December 31, 2011 '
IMPROVE ICE ARENA RECEIPTING INTERNAL CONTROL '
During our audrt, we reviewed the receipts collection system of the ice arena and found the process to be
decentralized from the City's regular receipting process. Currently, the City employs an Ice Arena
Manager who collects and records funds and also maintains copies of signed ice rental contracts and a '
list of payers.
Areas where controls could be implemented include: '
• Segregate duties so that employees are not able to receipt money, prepare reconciliations and
prepare the deposit
• Have an employee independent of collecting the cash maintain and create the billing contracts to �
ensure that all the contracts are being billed and the revenue is being deposited by the City
• Check ice arena schedules to contracts to ensure that all ice time is being billed
To improve internal control over the ice arena receipting process and to prevent omissions and errors, '
we recommend the City implement additional oversight procedures to ensure the accuracy and
completeness of ice arena receipts.
IMPROVE COMMUNITY CENTER RECEIPTING INTERNAL CONTROL ,
During our audit, we reviewed the receipts collection system of the community center and found the �
process to be decentralized from the City's regular receipting process. Currently, the City employees
who collect and record funds, remit payments to the Community Center Manager who maintains all
ledgers and creates deposits. �
Areas where controls could be implemented include:
• Include support for deposits from the Teen Center �
• Ensure all cash collected is processed through the cash register
• Segregate duties so that employees are not able to receipt money, prepare reconciliations and
prepare the deposit �
To improve internal control over the community center receipting process and to prevent omissions and
errors, we recommend the City implement additional oversight procedures to ensure the accuracy and
completeness of community center receipts. �
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REQUIRED COMMUNICATION
' December 31, 2011
We have audited the basic financial statements of the City for the year ended December 31, 2011, and
, have issued our report dated Apri125, 2012. Professional standards require that we provide you with the
following information related to our audit.
' OUR RESPONSIBILITY UNDER U.S. GENERALLY ACCEPTED AUDITING STANDARDS
AND GOVERNMENT AUDITING STANDARDS
, As stated in our engagement letter, our responsibility, as described by professional standards, is to
express an opinion about whether the financial statements prepared by management with your oversight
are fairly presented, in all material respects, in conformity with U.S. generally accepted accounting
' principles. Our audit of the financial statements does not relieve you or management of your
responsibilities. Our responsibility is to plan and perform our audit to obtain reasonable,but not
absolute, assurance that the financial statements are free of material misstatement. As part of our audit,
we considered the internal control of the City. Such considerations were solely for the purpose of
� determining our audit procedures and not to provide any assurance concerning such internal control. We
are responsible for communicating significant matters related to the audit that are, in our professional
judgment, relevant to your responsibilities in overseeing the financial reporting process. However, we
� are not required to design procedures specifically to identify such matters.
As part of obtaining reasonable assurance about whether the City's financial statements are free of
� material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts and grant agreements, noncompliance with which could have a direct and material effect on
the determination of financial statement amounts. However, providing an opinion on compliance with
� those provisions was not an objective of our audit.
PLANNED SCOPE AND TIMING OF THE AUDIT
� We performed the audit according to the planned scope and timing previously communicated to you.
QUALITATIVE ASPECTS OF ACCOUNTING PRACTICES
� Management is responsible for the selection and use of appropriate accounting policies. In accordance
with the terms of our engagement letter, we will advise management about the appropriateness of
' accounting policies and their application. The significant accounting policies used by the City are
described in Note 1 to the financial statements. We noted no transactions entered into during the year
for which there is a lack of authoritative guidance or consensus. There were no significant transactions
' that have been recognized in the financial statements in a different period than when the transaction
occurred.
Accounting estimates are an integral part of the financial statements prepared by management and are
' based on management's knowledge and experience about past and current events and assumptions about
future events. Certain accounting estimates are particularly sensitive because of their significance to the
financial statements and because of the possibility that future events affecting them may differ
' significantly from those expected. The most sensitive estimates affecting the financial statements were
as listed on the following page.
'
� 5
'
CITY OF SHAKOPEE '
REQUIRED COMMUNICATION
December 31, 2011 ,
QUALITATIVE ASPECTS OF ACCOUNTING PRACTICES '
Depreciation—The City is currently depreciating its capital assets over their estimated useful lives,
as determined by management, using the straight-line method.
Expense/Expenditure Allocation—The City is currently allocating certain costs among the programs '
and supporting services benefited. The costs are allocated based on management's estimates.
Net Other Post Employment Benefits (OPEB) Obligation—This liability is based on an actuarial '
study using estimates of future obligations of the City for post employment benefits.
We evaluated the key factors and assumptions used to develop the above estimates in determining they '
are reasonable in relation to the financial statements taken as a whole.
The disclosures in the financial statements are neutral, consistent and clear. �
DIFFICULTIES ENCOUNTERED IN PERFORMING THE AUDIT
We encountered no difficulties in dealing with management in performing and completing our audit. '
CORRECTED AND UNCORRECTED MISSTATEMENTS �
Professional standards require us to accumulate all known and likely misstatements identified during the
audit, other than those that are trivial, and communicate them to the appropriate level of management. �
DISAGREEMENTS WITH MANAGEMENT
For purposes of this letter, professional standards define a disagreement with management as a financial ,
accounting, reporting or auditing matter, whether or not resolved to our satisfaction that could be
significant to the financial statements or the auditor's report. We are pleased to report that no such
disagreements arose during the course of our audit. �
MANAGEMENT REPRESENTATIONS
We requested certain representations from management which were provided to us in the management r
representation letter.
MANAGEMENT CONSULTATIONS WITH OTHER INDEPENDENT ACCOUNTANTS '
In some cases, management may decide to consult with other accountants about auditing and accounting
matters, similar to obtaining a"second opinion" on certain situations. If a consultation involves '
application of an accounting principle to the City's financial statements or a determination of the type of
auditor's opinion that may be expressed on those statements, our professional standards require the
consulting accountant to check with us to determine that the consultant has all the relevant facts. We are '
not aware of any consultations by the City's management with other accountants during the course of
our audit.
,
6 '
,
� CITY OF SHAKOPEE
REQUIRED COMMUNICATION
, December 31, 2011
OTHER ISSUES
� We generally discuss a variety of matters, including the application of accounting principles and
auditing standards, with management each year prior to retention as the City's auditors. However, these
� discussions occurred in the normal course of our professional relationship and our responses were not a
condition to our retention.
� OTHER INFORMATION IN DOCUMENTS CONTAINING AUDITED FINANCIAL
STATEMENTS
� We have not reviewed, and it is our understanding, that no other published documents exist that contain
audited financial statement information, for which we are currently auditing. As stated in our
engagement letter, if you publish or reproduce the financial statements or make reference to our Firm
name in relation to such documents, you agree to provide us with a copy of the final reproduced material
' for our approval before it is distributed.
'
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� 7
1
CITY OF SHAKOPEE '
FINANCIAL ANALYSIS
December 31, Z011 �
The following pages provide graphic representation of select data pertaining to the financial position and '
operations of the City for the past five years. Our analysis of each graph is presented to provide a basis
for discussion of past performance.
GENERAL FUND OPERATIONS OF THE CITY �
For the year ended December 31, 2011, revenues exceeded expenditures and transfers out and increased
the fund balance by approximately $ 266,000. �
�General Fund
$za,000,000
'
szo,000,000 _ ------- ---
516,000,000 _.—. - .._. _ '
i � i
$12,000,000 ! � - — � �
� I
$8,000,000
$4,000,000 ' { �
$_ _ � �_ �
�om �� ?oos � �o�� zoio zoii �
■Revenues $15,266,076 S15,878,047 $I"7,074,639 $19,589,535 $20,956,396
■Expenditures 16,129,807 16,289,022 16,03Q691 18,724,835 18,674,938
❑FundBalance 9,707,533 9,859,602 11,502,280 Q037,730 9,304,194 �
I�General Fund Revenues/Expenditures�
Per Capita '
$600
5556
5482 � 547�� .5484 �;.1'�7 S505 5�195
$500 ..._..__.. .. _.._ . '
__—..$456 --
��$419 ��423
$400 I
I I '
$300
$200 '
$100 '
$- _.. _ . . ..
2007 2008 2009 2010 3011 �
iORevenues CExpenditures IJ
* 2010 updated for change in accounting principle for component unit reporting
8 �
'
, CITY OF SHAKOPEE
FINANCIAL ANALYSIS
� December 31, 2011
GENERAL FUND OPERATIONS OF THE CITY
� For the 2011 operating year, the City Council provided a budget that would decrease the General Fund
balance by $ 345,820. Revenues exceed expectations and expenditures were 7.5%under budget. At
, year-end, expenditures and transfers out exceeded revenues and transfers in by over $ 266,000.
Bud et Actual Variance
, Revenues:
Taxes and Assessments $ 13,396,820 $ 14,300,921 $ 904,101
Licenses and Permits 1,246,750 1,225,560 (21,190)
, Intergovernmental 737,560 796,076 58,516
Charges for Services 3,547,010 3,879,113 332,103
Fines and Forfeitures 436,000 357,249 (78,751)
, Miscellaneous Revenues 343,280 397,477 54,197
Total Revenues $ 19,707,420 $ 20,956,396 $ 1,248,976
` Expenditures:
General Government $ 3,254,700 $ 2,774,859 $ (479,841)
� Public Safety 9,715,730 9,401,915 (313,815)
Public Works 2,843,660 2,629,581 (214,079)
Parks and Recreation 4,361,550 3,868,583 (492,967)
LTotal Expenditures $ 20,175,640 $ 18,674,938 $ (1,500,702)
Transfers In $ 122,400 $ 122,400 $ -
� Transfers Out - (2,137,394) (2,137,394)
Net Transfers 122,400 (2,014,994) (2,137,394)
� Change in Fund Balance $ (345,820) $ 266,464 $ 612,284
� Significant revenue budget variances are a result of receiving more in property taxes than anticipated
and higher than expected charges for services for services with Shakopee Public Utilities Commission
(SPUC), police services and snow and ice removal that is billed out to other entities.
, All functions of the expenditures were under budget. Public safety expenditures were under budget due
to unfilled police positions. General government expenditures were under budget in most areas due to
newer employees, less professional services needed, utilization of the internal service funds more
� frequently and conservative budgeting and spending. Public works was under budget due to processing
more of the capital needs through other funds. Parks and recreation was under budget due to lower
seasonal costs and budgeting for more staff than needed based on programs.
�
�
■ 9
�
CITY OF SHAKOPEE '
FINANCIAL ANALYSIS
December 31, 2011 �
GENERAL FUND OPERATIONS OF THE CITY �
Unreserved/LJnassigned Fund Balance as a Percent of Expenditures '
�o�ro
67% '
60% �- -- -- -
�---
".�..,,_�'` '
50% �`,. �
---- - ' ____ 54% -- ----- ------ __ __-----�----- - - - _._._._ ___..__
----- ---
! s-- �
49% 49% �
40% I� __ _ 44%
I
I '
° - _. _ --- -----
o -�-- -----—-- — - - - --
� �
20% ' _ - _ _
I
10% i-- - - _- - - - --- - --- -
- - --- _ ___ _. ... -- -- --
�
I
I �
0% .---- - - -- -------- - - -------- - - -- --�— -- - �
2007 2008 2009 2010 2011
The City's target General Fund balance is an unassigned level between 40% (minimum) and 45% of �
current year expenditures. This level is to provide working capital for cash flow, expected decline in
revenues and unforeseen expenditures such as natural disasters. Replenishing the fund balance when it ,
falls below the target level shall be accomplished by interfund transfers or budgeting for expenditures
and other uses to be less than revenues or other sources over a period not to exceed three years. For the
year-ended December 31, 2011, the City exceeded their policy, maintaining an unassigned fund balance '
of 49%.
'
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�
lo �
,
, CITY OF SHAKOPEE
FINANCIAL ANALYSIS
, December 31, 2011
, GENERAL FUND REVENUES
The City's revenue in the General Fund has increased each of the last five years. During 2011, revenue
in the General Fund exceeded the budget by $ 1,250,000 and exceeded the prior year revenue by
' $ 1,400,000, increasing from $ 19,589,535 to $ 20,956,296. The major increases in the 2011 revenue
were in property taxes and charges for services. During 2011, the City kept the entire General Fund levy
in this Fund instead of allocating to debt service funds. Charges for services were greater in 2011 due to
� an increase in services billed out to other entities for police services, snow and ice removal and other
services.
' During 2011, property taxes represented 68% of the total General Fund revenues. Charges for services
represented the second largest component at 19%.
� General Fund Reve�ues I
$24,000,000 - ---- -- --- ---- -----_ _
j
� I
$21,000,000 � - -_ - — - --— - --
I
$18,000,000 'r- --- - -- - ----
�
$15,000,000 �I __ _ _ _
� '.
$12,000,000 '
, � ,
i
' $9,000,000 ; _ ' -- -- - - -
; I
$6,000,000 �� � ` -- ---
� ' __--____ ---
$3,000,000 ---
� I ,
$- �I 2007 2008 I l' - 2009 ---� 2010 - - 2011
- --- _
- -- -------
oMiscellaneous __ , $586,137
� � $484,110 $416,023 � $418,654 $397,477
--- --- - ---- ---- ! ._ _..-- ---__- - --- -------_ _;
❑Charges for Services � 1,090,018 � 1,093,250 � 804,536 I 3,028,330 ' 3,879,113
� - --- — - — --- --- ---- — --- — - -- - -- -- - --
■Fmes and Forfeitures � 451,418 � 366,618 364,895 I 423,746 357,249
__— .. ---_ �_ _ --- __ _ ------ --- ----- ___ __ _ ____ __ --' ----- - ----
❑LicensesandPermits j _ 973,658 _I 691,415 � 1,122,619 �_ 1,303,904 _ 1,225,560
�Intergovemmental � 590,438 361,412 ; 593,647 � 828,906 796,076 �
- - --- - - -- i- -- - - - ---- --- - --- — ,
■Taxes and Assessments 11 574,407 i 12,881 242 � 13,772,919 13,585 995 14,300,921
� I-_ _.___ _-- _I____ --- - _ ---- --- -- ----- I_ _ --- - ---
,
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� ll
�
CITY OF SHAKOPEE ;'
FINANCIAL ANALYSIS
December 31, 20ll '
TAX LEVY, CAPACITY AND RATES '
The 2011 levy includes the General Fund and debt service levies. The tax levy is then reduced by a
Market Value Credit and fiscal disparity that are received in the form of state aids. Disparity aid is
reported as tax revenue, but Market Value Credit reduces the amount of property tax revenue and is ,
reflected as intergovernmental revenue in the City's financial statements; however, during 2011, the
City's Market Value Credit of$ 595,572 was unalloted due to budget reductions made by the State of
Minnesota. �
Taxable Tax Capacity and Certified Levy
$45,000,000 - - '
$40,000,000 -- -- -- �
$35,000,000 .- ------- - -
$30,000,000 '
$25,000,000 I
$20,OOQ000 - __ - -_ __ . __
�
$15,000,000 - — -
�
$10,000,000 I - �
$5,000,000 -
$- -- � �
p � 2009 2010 20ll
2007 � 2008
_ -�-_- ----
■T aa�c ble T�Ca aci $36 078,921 $40 291,149 I $40,984 725 �, $38,952,163 $37,680,587
�_. --- _ _ ___ , _ _ _ — _ _ _
I❑CertifiedLevy 12,745,449 14,222,007 I 14,983,677 14,715,299 1A,717,367 I '
* Tax capacity values and levy obtained from the League of Minnesota Cities.
�
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12 �
�
� CITY OF SHAKOPEE
FINANCIAL ANALYSIS
' December 31, 20ll
' TAX LEVY, CAPACITY AND RATES
As illustrated below and on the prior page, the tax capacity of the City increased $ 1.6 million, or 4.4%,
since 2007. The City's property tax levy increased 15.5%, or$ 1,971,918, in the same time frame. With
� the levy increasing and tax capacity declining in 2011, the tax rate increased from 31.94% in 2007 to
34.73% in 2011. The state average tax rate for Minnesota cities was 42.53% for 2011.
____ _ ___
Tax Capacity Rate�
40.000 -
� 34.730
35.000 32.630 ----- - ;33.710 --. _ _ _--- i
31.940 31.930
i
, -- _- I
30.000
' 25.000
' 20.000 --
i
15.000 ----- __ ___ ---- ___ _;
--- - - _
-- ------
� '
10.000 - -- ---_ --- --- - ---- _--- _ i
� i
5.000 --
� 0.000
2007 2008 2009 2010 2011
� * Tax rates obtained from the League of Minnesota Cities.
�
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' 13
�
CITY OF SHAKOPEE �
FINANCIAL ANALYSIS
December 31, 2011 �
GENERAL FUND '
In 201 l, total General Fund expenditures decreased $ 61,581, or less than 1%, from $ 18,724,835 in
2010 to $ 18, 674,938 in 2011. General government decreased approximately $ 266,000 as a result of
expensing more of the Information Technology Internal Service Fund, personnel changes and �
conservative spending. Public safety increased $ 426,556 as a result of increased wages, health
insurance increases and a higher number of fire calls. Recreation decreased $ 219,050 due to lower
seasonal costs. As noted earlier, all of the functions were under their budgets. �
2011 General Fund Expenditures
'
General Govemment �
Recreation �So�O
21% �
- � '
_-- 1
,� � �
�;�;:
Public Works �
f �14% �----
�Public Safety
50°�a
�
�2010 General Fund Expenditures�
�
General Govemment �
Recreation � 16%
22% �
z�`
\ ,
-_--- 1
/' / �
I
�
Public Works��
�
14% ���`'� �
_ '��i
�Public Safety
48%
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14 '
,
� CITY OF SHAKOPEE
FINANCIAL ANALYSIS
' December 31, 2011
� ENTERPRISE FUNDS
The City has two enterprise funds. The following charts compare the segment information and retained
earnings of all the enterprise funds for the last five years.
� ,� �
�Sewer Fund'
�a,000,000
� $3,SOQ000 ---__ ...___ . I
$3,000,000 .�. �'
� — � �
$2,500,000 ,x:
$2,000,000 �� --- — —
,f I �
� $1,500,000 - --- - --- i
i
I
$�,000,000
,..
I
$soq000
S u � _ ; . '—
'
$(500,000) —... _.. .- --�---__._._.___._.—__---- - -
--_. _--- '�i
� $�I,OOQ000) --� --- -- ------ I
2007 I 2009 2009 �2010 � 20ll
_ - _ —
-___ _._ .. _._ . -- _ -- --_ - -. ____.
�Operating Revenues : 52,773,051 I S2 542,564 53,444 044 , 53,46Q974 � $2,936,144 �
_._. . ____ ._ _—_ .___-
___ . ..__'_ "...___ .__-_ __ .-_.--__-y
eOperatmgExpenses ! � 2,938,955� 3304,759 I 3,398117 I 3,683,168 'i 3,836,202 i
----- -
- ...-- ---- -----. . ._.-------- --
------"
❑0 erann Income Loss )- ____- ) __.. I _._____ .___II .. �__._�_ (900,058)__ �
' .._.. g _-_ .-_ __-_-_-_ -.
P g ( )I (165,904 � (762,195 45 927 222,194 I
�OChan e in Ne[Assets I 3,884,672 I 611,206 603 882 301,459 �� (5524,858) _;
,,.___.-_. -___... _ . . .
Storm Drainage Fund��
sz,000,000 -------------
� -- ---------- -
�t,soo,000 - __ __ __ _ -- -
' ��,000,000 i i
I
Ssoo,000 _ __ � ___ .,.,:
' I --
$- - � i
' I
$(soo,000� - . _
� $�i,oao,000� -- - ----- __--- _---- J
zoo� 1 zooa T zoo9 T zmo � zoi� __
— --- - - — - -- - -
■ServiceCharges I 51266358 i 51,265374 � EI,320,566 � 57,187,229 5995,855 �
-- �- —- -._ ... -- --� -----
I�Operating Expenses � _1 352 078 1,435 376 1,264,261 I 1,787,295 1,411,271 _�
- — - — — -- —
� 'OOperatingIncome(Loss)� (85,720) (170,002) � 56,305 I (600,066) � (415,416) j
__ -.___- -_ ._._ - . _._ - - . __- _._ _--_-
�OChange in Net Asseu � 1,527,949 706,206 673 618 I . 299,132 � 55,008 ,
During 2011, the Sewer and Storm Drainage Funds both had operating losses. This is the fourth time in
� the past five years the Funds reported an operating loss. This is primarily due to the depreciation
expense in both Funds.
' 15
'
CITY OF SHAKOPEE �
FINANCIAL ANALYSIS
December 31, 2011
'
DEBT SERVICE
The following charts illustrate debt service requirements through 2030 and bonded debt for the last five ,
years.
�Debt Service Schedule i
'(Five Year Increments)
$9,OOQ000 -------- — - ____ ---__ --- -� ,
$8,000,000
$7,000,000 � �
i I
$6,000,000 ' �
x'` Ii
$5,000,000 � �
- - I
I
$4,000,000 �
$3,000,000 , �
�I
$2,000,000 I
$1,000,000 i ,
$- - ----�I
2012-2016 2017-2021 2022-2026 _ 2027-2030 �
� ■Interest OG.O.Bond Pr�cipal �
_ . . __-------._..
�Bonded General Obligation Debt �
$30,000,000 _ ____ ---__— __ - --_
� i ,
$25,000,000 �� -- !
� I
i
5;7,941,439 --- . I
$2Q000,000 bZ658,289 ------ �
_ _ __ _ f
� '�7,504.770 i'�
I '$5.12?,69? �,
'
$15,OOQ000 � -- -- - - _
I `�4.625.9db
1
f41v.�S3,5ei
$IO,OOQ000 ��51��)56,711 � -_ �
�$13.�50,230 I S 1 3;32.303 �
511,�19,1)jd
i
$S,OOQ000 -
'
$- _ _ ___
2UU7 200� �UUy �UIU 3U11
�, ■Gross Bonded Debt ODebt Service Fund Balance ■Net Bonded Deb� � '
l6 '
�
� CITY OF SHAKOPEE
FINANCIAL ANALYSIS
December 31, 2011
1
ADDITIONAL INFORMATION
�
Minnes�ta Median City S�n� Ratin�s
� 40% ,
I 36%
� 35%
ii
30% ,
� 26%
25% �
� ��I 20%
20%
�
15°/a ,
�
' 10% ��-�8%
�6%
! J%
i 2% 1%
' 0%
� 0%
Aaa Aal Aa2* Aa3 A1 A2 A3 Baal
� * Denotes City's Rating
' Information obtained from Moody's Bond Ratings for Minnesota Median Cities
'
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� 17
'
CITY OF SHAKOPEE '
FINANCIAL ANALYSIS
December 31, 2011
�
ADDITIONAL INFORMATION
The following information shows 2010 per capita data for the City in comparison to three other cities �
similar in size and/or operations (Cities of Savage, Chanhassen and Chaska [the "Cities"]). This
information is based on the population estimates listed below. Information for 2011 is not yet available. �
When analyzing this information, keep in mind that each of the Cities is unique in its operations.
Po ulation Em lo ees �
Sliakopee 37,076 168
Savage 26,911 149
Chanhassen 22,952 68 �
Chaska 23,770 181
The graph below shows the total General Fund revenues and expenditures per capita, as well as General
Fund tax revenues per capita for the various Cities. �
2010 General Fund
Revenues and Expenditures Per Capita �
$600 _ _ __ _ ___.._ _- -_ _ _ - - - - --
II
$500
i '
;
�
$400 - -- - I� �
�
$300 !, �
i
�
i �
$200 �' �
�]00 - - - -- '
�
_ I _ _ _ _ I
_ _ --+� -- - -- — - _____ -- _ _ - - �
0
�■Shakopee I - Total h4145ditures Total�439 nues Tax 36vsenues �
F- - __-__
�Savage�
_ ___ __---- ---- --- — -- ----_ -----
�Chaska 406 425 318
� _ — -- --_ _ __ __ -- _ __ _, '
402 407 179
❑Chanhassen i __ __ _ ---- - - -- --- __ _ --
�
* Population, revenues and expenditures obtained from 2010 Comprehensive Annual Financial �
Report (CAFR) for all Cities
'
18 �
�
� CITY OF SHAKOPEE
FINANCIAL ANALYSIS
December 31, 2011
�
ADDITIONAL INFORMATION
� The following graphs show the General Fund expenditures by function per capita for the various Cities.
� !� 2010 General Fund
Expenditures Per Capita
$250
�
$200 ------ - -- --
�
$I50 -- - _
� $]00 --
� $50 _ _ _
� $O
General Govemment Public Safety Public Works Recreation
____.-- -- --. . ._--.. . _- --� _.-. . .- _ ..__ ..
�A Shakopee $80 $242 �� 571 5110
OChanhassen 73 l97 78 46 �
g _ ----
� -- -- -- +- - -- - - --
� 82 130 � 95 81
- _ _ _ , _ _--- - _ - _--;
�oChaska 1 127 156 � ]00 i� 20 J
____.
2010 Per Capita Information
� ' Governmental Funds
sa.000
� $3,500
$3.000
� 52,500
$2,000 --- -- -----
� $IS00 ___ _ _ _ ___ - --- - _
$1.000 : --- ---- .
t5500 ---_
$0 •:.
Outstanding Debt Total Revenues* 1 i�Itc���ues Caprtal Outlay �
� I __ -- -- - _
�Sliakopee $505 $649 �384 $76 i
-- __ - - - - -- - - �
0 Savage j 2 691 786 ± 566 271 ;
- -- - - - -- - -- --- --- - -J
�Chanhassent 1,037 648 442 219 I
----�-- --- -- -. _ -- - - ---- �
� ❑Chaska ; 1.561 � 854 ----i 449 1 238 �
* Data obtained from 2010 Comprehensive Annual Financial Report (CAFR) for all Cities
� 19