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8 City of Elk River Financial Analysis The following pages provide graphic representations 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 and how implementing certain changes may enhance future performance. We suggest you view each graph and document if our analysis is consistent with yours. A subsequent discussion of this information should be useful for planning purposes. General Fund – Fund Balance The following graph illustrates the relationship between cash and investments and fund balance over the past five years. At December 31, 2024, the General Fund balance consisted of an unrestricted fund balance of $9,538,493. The total unrestricted fund balance represented just over five months of expenditures at current levels. The Office of the State Auditor has issued a statement of position recommending cities maintain an unrestricted fund balance of approximately 35% to 50% of fund operating revenues, or no less than five months of operating expenditures. The City's fund balance policy for the General Fund identifies a minimum unassigned fund balance of 40-45% of budgeted operating expenditures. Based on the 2025 budgeted expenditures of $22,210,100, the City's unassigned General Fund balance was at 43% at December 31, 2024. $8,250,728 $8,750,629 $8,888,888 $9,323,318 $9,538,493 $8,015,854 $8,716,326 $9,307,918 $9,243,274 $9,091,514 $7,000,000 $8,000,000 $9,000,000 $10,000,000 2020 2021 2022 2023 2024 Cash and Investments and Fund Balance Fund Balance Cash and Investment Balance On the following pages, we will discuss the revenues and expenditures of the General Fund and the variations in the fund balance. Page 383 of 637