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City of Elk River
<br />Management's Discussion and Analysis
<br />GOVERNMENT -WIDE FINANCIAL ANALYSIS (CONTINUED)
<br />Financial Analysis of the Government's Funds
<br />As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance -
<br />related legal requirements.
<br />Governmental Funds. The focus of the City's governmental funds is to provide information on near -
<br />term inflows, outflows and balances of spendable resources. Such information is useful in assessing the
<br />City's financing requirements. In particular, unrestricted fund balance may serve as a useful measure of
<br />a government's net resources available for spending at the end of the fiscal year.
<br />As of the end of the current fiscal year, the City's governmental funds reported combined ending fund
<br />balances of $42,522,183, a decrease of $2,644,989 in comparison with the prior year. Approximately
<br />18% of this total amount ($7,610,065) constitutes unassigned fund balance, which is available for
<br />spending at the City's discretion. The remainder of fund balance ($34,912,118) is not available for new
<br />spending because it is either 1) nonspendable ($114,967), 2) restricted ($12,149,090), 3) committed
<br />($9,583,438), or 4) assigned ($13,064,623) for the purposes described in the fund balance section of
<br />each balance sheet.
<br />Fund Balance December 31,
<br />Increase
<br />or Funds 2022 2021 (Decrease)
<br />General $ 8,888,888 $ 8,750,629 $ 138,259
<br />The General Fund is the chief operating fund of the City. The General Fund had an increase in fund balance
<br />of $138,259. The fund had net transfers of $2,158,650 during the year, which contributed to the increase.
<br />Pavement Management $ 6,274,764 $ 6,369,604 $ (94,840)
<br />The Pavement Management Fund is a major capital projects fund with a total fund balance of $6,274,764.
<br />Fund balance decreased $94,840 from 2021 as investment loses of $725,166 contributed to the decrease.
<br />Proprietary Funds. The City's proprietary funds provide the same type of information found in the
<br />government -wide financial statements, but in more detail. Unrestricted net position of the enterprise
<br />funds at the end of the year amounted to $32,615,346. The total increase in net position for the funds
<br />was $4,806,363.
<br />The City's General Fund budget was not amended during the year. The budget called for no change in
<br />fund balance. The General Fund had an actual increase of $138,259 in 2022. Some of the larger
<br />variances are as follows:
<br />• Revenues were over budget by $206,671 with charges for services revenue being over budget by
<br />$111,410. Licenses and permits were over budget by $73,433.
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