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Capital Improvement Financing <br /> <br />Implementing capital improvements requires the utilization of sound, economical <br />financing methods. The City of Elk River has several financing mechanisms available, <br />ranging from cash reserves to special-purpose funds to borrowing through the issuance <br />of municipal bonds. Several funding sources may be used for a project. The following <br />funding sources are identified as potential financing mechanisms for the projects in the <br />CIP: <br /> <br />Internal Sources: <br />Capital Outlay Reserve Î this fund was established to help build reserves for the <br />purchase of the cityÓs information technology hardware and software. <br /> <br />Development Fund Î this fund accounts for activities related to economic development <br />within the city. <br />Equipment Replacement Fund Î this fund was established to account for the <br />purchases of the cityÓs vehicles and mobile equipment. Funding is provided through <br />departmental charges based on the amortization of their respective equipment. <br />FTCenter Îthis fund accounts for the operation and maintenance of the multipurpose <br />facility which is funded by user fees. <br /> <br />Government Buildings Reserve Î this fund was established to provide funding for the <br />replacement and/or rehabilitation of city facilities. The major source of revenue is from <br />landfill expansion fees. <br />Liquor Fund Î this fund accounts for the operations and maintenance of the cityÓs two <br />off-sale municipal liquor stores. A portion of the profits provide funding for park <br />improvement projects. <br /> <br />Park Dedication Î this fund accounts for park dedication fees from developers and <br />funds expenditures for park land acquisitions and park capital improvements. <br />Park Improvement Î this fund was established to account for the replacement and <br />maintenance of park equipment and for the beautification of city parks. It is financed by <br />an annual transfer from the Liquor Fund. <br /> <br />Pavement Management Î this fund accounts for franchise taxes collected on gas and <br />electric bills which the city uses to fund street projects. <br /> <br />Sewer Fund Î this fund accounts for customer sewer service charges that are used to <br />finance the sewer system expenses and infrastructure improvements. <br /> <br />Special Assessments Î costs of the improvements are levied against those properties <br />that benefit from a particular improvement to finance such improvements. <br /> <br />4 <br />