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70 <br />City of Elk River <br />Notes to Basic Financial Statements <br />NOTE 4 – NOTES RECEIVABLE/CONTRACT FOR DEED (CONTINUED) <br />In 2015, the City issued a $1 ,288,589 long-term note receivable related to the sale of property to a <br />developer under an abatement agreement. The note shall be payable in semiannual installments as <br />tax abatement revenues are received , commencing on August 1 , 2017, and maturing February 1, <br />2037. A note receivable of $558,562 in the Development Fund is outstanding at December 31 , 2024. <br />In 2021, the City entered into a $320,000 contract for deed for property, equipment, and buildings <br />located at property commonly referred to as Pinewood Golf Course , located in Elk River, Minnesota. <br />The contract for deed is to be repaid annually at 4% interest beginning July 2022. The contract for <br />deed matures on August 1, 2037. The balance of this contract for deed is $270,113 at December 31, <br />2024. <br />In 2006, the HRA issued a loan to a developer to assist in the financing of a housing development for <br />the benefit of low and moderate income residents which was funded with state grant proceeds. <br />Repayment of the loan is deferred for 30 years , payable in one lump sum at an interest rate of 1%. <br />Notes receivable of $400 ,000 in the HRA is outstanding at December 31 , 2024. <br />Starting in 2015, the HRA issued loans to applicants under the rehabilitation loan program. The terms <br />of each loan vary and are payable over five to 15 years with rates from 1.25% to 3.25%. Notes <br />receivable of $192,670 in the HRA are outstanding at December 31 , 2024. <br />NOTE 5 – LEASES RECEIVABLE <br />The City has various leases for building space. The lease agreements include annual principal and <br />interest payments. Interest and discount rates on the lease agreements range from 3.0% to 3.9%. <br />Revenue from these leases for the year ended December 31 , 2024, was $65,395. <br />There are also multiple leases with Verizon and Sprint that allows Elk River Municipal Utilities to <br />place antennas on water towers. The lease payments increase yearly. Interest and discount rates on <br />the lease agreements range from 1.41% to 1.78%. As of December 31 , 2024, the lease principal <br />receivable balance was $4,733,420. This is partially offset with a deferred inflow of lease resources. <br />Page 260 of 637