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<br />Financial Analysis ofthe Government's Funds
<br />
<br />Governmental funds. The focus of the City's governmental funds is to provide information on near-term inflows,
<br />outflows, and balances of spendable resources. Such information is useful in assessing the City's financing requirements.
<br />In particular, unreserved fund balance may serve as a useful measure of a government's net resources available for
<br />spending at the end of the fiscal year.
<br />
<br />As of the end of the current fiscal year, the City's governmental funds reported combined ending fund balances of
<br />$29,912,904. Approximately 61 % of this total amount ($18,226,769) constitutes unreserved fund balance, which is
<br />available for spending at the City's discretion. The remainder of fund balance ($11,686,135) is reserved to indicate that it is
<br />not available for new spending because it has already been committed to provide for 1) debt service ($6,595,667), 2) capital
<br />equipment/projects ($2,716,718), 3) landfill mitigation ($2,160,268), or 4) a variety of other restricted purposes ($213,482).
<br />
<br />The General fund is the chief operating fund of the City of Elk River. The total fund balance of the General fund increased
<br />by $634,001 in 2005, which was primarily due to increased revenues collected for licenses and permits and charges for
<br />services. In addition, expenditures were under budget due to a mild winter and personnel vacancies.
<br />
<br />The Improvement Bonds fund increased by $616,142, which is primarily due to transfers. The Capital Projects fund and
<br />Permanent Improvement Revolving fund increased by $1,276,780 and $1,268,016, respectively, due to the prepayment of
<br />assessments on improvement projects. The Tax Increment Financing Districts fund increased by $311,370 due to developer
<br />reimbursement of project costs.
<br />
<br />Proprietary funds. The City of Elk River's proprietary funds provide the same type of information found in the
<br />government-wide statements, but in more detail.
<br />
<br />Unrestricted net assets in the respective proprietary funds are Municipal Liquor - $2,003,444, Garbage - $109,789, Sewer _
<br />$7,194,852, Water - $891,943, and Electric - $1,756,823. All proprietary funds had increases in net assets.
<br />
<br />General Fund Budgetary Highlights
<br />
<br />Differences between the original budget and the final budget for the General fund amounted to $305,400. The revenue and
<br />expenditure budgets were amended to reflect increased revenues in licenses and permits, and charges for services, and
<br />expenditure increases in all categories due to increased activity and demand for services.
<br />
<br />Capital Asset and Debt Administration
<br />
<br />Capital Assets. The City of Elk River's investment in capital assets for its governmental and business type activities as of
<br />December 31, 2005, amounts to $162,405,542 (net of accumulated depreciation). This investment in capital assets includes
<br />land, buildings, improvements, equipment and infrastructure.
<br />
<br />Capital Assets, Net of Depreciation
<br />
<br />Governmental
<br />Activities
<br />2005 2004
<br />
<br />Business-type
<br />Activities
<br />2005 2004
<br />
<br />Total
<br />2005 2004
<br />
<br />Land $ 31,489,967 $ 29,033,685 $ 1,442,669 $ 1,442,669 $ 32,932,636 $ 30,476,354
<br />Construction in progress 2,432,002 1,116,526 1,030,122 3,548,528 1,030,122
<br />Buildings 14,703,884 15,062,808 10,310,583 9,105,721 25,014,467 24,168,529
<br />Other improvements 1,383,039 1,216,737 1,383,039 1,216,737
<br />Equipment 3,112,197 2,485,867 377,459 372,216 3,489,656 2,858,083
<br />Infrastructure 39.034.153 38.959.333 57.003.063 54.515.104 96.037.216 93.474.437
<br />Total $ 92155242 $ 86 758 430 $ 70 250 300 $ 66 465832 $162405542 $153224262
<br />
<br />Additional information on the City's capital assets can be found in Note 3C on pages 44 - 46 of this report.
<br />
<br />Long-term debt. At the end of the current fiscal year, the City had total long-term debt outstanding of $36,427,227, an
<br />increase of$I,153,492 from 2004. General obligation revenue bonds ($14,530,000) were used to finance the construction
<br />ofan ice arena, a liquor store, and sewer, water and electric systems. Lease revenue bonds ($8,785,000) were used to
<br />
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