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CITY [)FELK RIVER, MINNESOTA <br />NOTES TDFINANCIAL STATEMENTS <br />DECEMBER 31.200O <br />Not 4: RECEIVABLES <br />E�Lgpgrty Taxes <br />The City Council annually adopts etax levy and certifies itbothe County inDecember each year for <br />collection the following year. The County isresponsible for collecting all property taxes for the City. <br />These taxes attach an enforceable lien on taxable property as of January 1 and are payable by the <br />property owner in May and October each year. The taxes are collected by the County Treasurer and tax <br />settlements are made to the City three times a year, in January, July and December. <br />Taxes payable on homestead property, as defined by State Statutes, are partially reduced by <br />homestead and agricultural credit aids. These credits are paid to the City by the State of Minnesota in <br />lieu uftaxes levied against homestead property. The State remits this credit intwo equal installments im <br />July and December each year. <br />Allowances are provided for the full amount ofdelinquent taxes except those collected bythe County in <br />November and December and remitted tothe City within sixty days after year end. This allowance is <br />reported onthe balance sheet aodeferred revenue. <br />Special & <br />Special assessments receivable include the following components: <br />m DelinquenL-inc|udes amounts billed toproperty owners but not paid. <br />• Deferred includes assessment installments that will be billed to property owners in future <br />years. <br />Special assessments are recognized as receivable and deferred revenue when the levy against the <br />benefited property is adopted by the City Council and certified to the County for collection. The <br />assessment revenue isrecognized when realized incash. <br />Notes Receivable <br />The City established a Revolving Loan Special Revenue Fund with the proceeds of grants received <br />from the State ofK&imnesota. These funds have been loaned toseveral businesses, The terms cf <br />repayment vary with each loan. The total notes receivable atyear end was $865.Q46. Under terms of <br />the grant agreement, a portion of the original grant will be returned to the State of Minnesota and is <br />reported asadue tVother governments liability. The remaining portion of the notes receivable is offset <br />by deferred revenue, Thua, revenue iorecognized when received in cash. <br />The City established a Department of Trade and Economic Development (DTED) Grant/Loan Special <br />Revenue Fund with the proceeds ofgrants received from the State ofMinnesota. These funds have <br />been loaned toone business. The terms ofthe loan are ten years with ovariable interest rate. The <br />total note receivable sdyear end was $QQ.377. The City retains all ofthe grant repayments. The <br />remaining portion ofthe note receivable isoffset bydeferred revenue. Thus, revenue isrecognized <br />when received incash. <br />Accounts Receivable <br />Accounts receivable include amounts billed for services provided before year end. <br />19 <br />