6.3 SR 06-05-2023 - Laserfiche WebLink

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City of Elk River Notes to Basic Financial Statements NOTE 4 — NOTES RECEIVABLEXONTRACT FOR DEED (CONTINUED) In 2015, the City issued a $1,288,589 long-term note receivable related to the sale of property to a developer under an abatement agreement. The note shall be payable in semiannual installments as tax abatement revenues are received, commencing on August 1, 2017, and maturing February 1, 2037. A note receivable of $718,086 in the Development Fund is outstanding at December 31, 2022. In 2021, the City entered into a $320,000 contract for deed for property, equipment, and buildings located at property commonly referred to as Pinewood Golf Course, located in Elk River, Minnesota. The contract for deed is to be repaid annually at 4% interest beginning July 2022. The contract for deed matures on August 1, 2037. The balance of this contract for deed is $304,019 at December 31, 2022. In 2006, the HRA issued a loan to a developer to assist in the financing of a housing development for the benefit of low and moderate income residents which was funded with state grant proceeds. Repayment of the loan is deferred for 30 years, payable in one lump sum at an interest rate of 1%. Notes receivable of $400,000 in the HRA is outstanding at December 31, 2022. In 2015, the HRA issued loans to applicants under the rehabilitation loan program. The terms of each loan vary and are payable over five to 15 years with rates from 1.25% to 3.25%. Notes receivable of $52,468 in the HRA are outstanding at December 31, 2022. NOTE 5 — LEASES RECEIVABLE The City has various leases for building space. The lease agreements include annual principal and interest payments. Interest and discount rates on the lease agreements range from 3.0% to 3.9%. Revenue from these leases for the year ended December 31, 2022, was $25,482. There are also multiple leases with Verizon and Sprint that allows Elk River Municipal Utilities to place antennas on water towers. The lease payments increase yearly. Interest and discount rates on the lease agreements range from 1.41% to 1.78%. As of December 31, 2022, the lease principal receivable balance was $5,188,673. This is partially offset with a deferred inflow of lease resources. 67