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<br />14
<br />City of Elk River
<br />Financial Analysis
<br />
<br />
<br />Enterprise funds may be used to account for any activity in which a fee is charged. It is not required
<br />to have the fee support the entire activity; however, the basic premise in establishing an enterprise
<br />fund is that the activity will be operated similar to a business. Therefore, it is expected the
<br />enterprise fund would at least be able to meet its obligations currently and into the future.
<br />
<br />Sewer Operations
<br />The following graph illustrates the current operations of the Sewer Fund for the past five years.
<br />Operating income is shown with and without depreciation below.
<br />
<br />Operating revenue increased $187,696, or 6.8%, from 2023 with increased rates and increased usage.
<br />Operating expenses increased by $564,042, or 14.5%, due in large part to legal fees and purchases
<br />with ARPA funds. The net effect of the increased revenues and expenses is an operating loss of
<br />$1,488,909 for the year. When not including depreciation and amortization of capital assets in the
<br />calculation, the Sewer Fund had an operating income of $219,765.
<br />
<br />2020 2021 2022 2023 2024
<br />Operating Revenues $2,481,522 $2,517,025 $2,633,732 $2,774,077 $2,961,773
<br />Operating Expenses 3,344,218 3,417,504 3,651,793 3,886,640 4,450,682
<br />Operating Income without
<br />Depreciation/Amortization 773,717 739,615 623,383 598,378 219,765
<br />Operating Loss (862,696)(900,479)(1,018,061)(1,112,563)(1,488,909)
<br /> $(2,000,000)
<br /> $(1,000,000)
<br /> $-
<br /> $1,000,000
<br /> $2,000,000
<br /> $3,000,000
<br /> $4,000,000
<br /> $5,000,000
<br />Sewer Operations
<br />
<br />Page 389 of 637
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