2024 City of Monticello Budget2024 Adopted Budget
City of MonƟcello, Minnesota
505 Walnut Street • 763-295-2711 • ci.monƟcello.mn.us
Table of Contents
Introduction and Overview
Directory of Public Officials .......................................................................................................... 1
Distinguished Budget Presentation Award ................................................................................... 2
Strategic Goals & Strategies ......................................................................................................... 3
Priorities & Issues ....................................................................................................................... 12
Budget Overview ........................................................................................................................ 16
Organization Chart ..................................................................................................................... 30
Financial Structure, Policy & Process
Fund Descriptions & Structure ................................................................................................... 31
Departments & Funds Relationship ........................................................................................... 34
Basis of Budgeting ...................................................................................................................... 35
Financial Policies ........................................................................................................................ 36
Budget Development & Administration Practices ................................................................ 36
Revenue Collection Practices ............................................................................................... 38
Expenditures and Payments Practices ................................................................................. 38
Capital Assets Policy ............................................................................................................. 40
Debt Administration Practices ............................................................................................. 40
Reserves and Fund Balances Policy ...................................................................................... 41
Financial Reporting & Accounting Practices ......................................................................... 42
Cash Management & Investment Policy .............................................................................. 43
Balanced Budgets Practices ................................................................................................. 51
The Budget Process .................................................................................................................... 53
Financial Summaries
Consolidated Financial Schedules
All Funds Summary By Fund Type ........................................................................................ 57
Revenues By Category and Fund Type ................................................................................ 59
Appropriations By Category and Fund Type ......................................................................... 61
Interfund Transfers .............................................................................................................. 63
Three Year Consolidated and Fund Financial Schedules
All Funds Summary By Year .................................................................................................. 64
Fund Balance/Working Capital ................................................................................................... 66
Changes in Fund Balance/Working Capital ........................................................................... 67
Ending Fund Balance/Working Capital History ..................................................................... 68
Revenue Sources By Fund
Revenue Trends & Analysis .................................................................................................. 69
Tax Levy History ................................................................................................................... 77
Tax Capacity History ............................................................................................................. 78
Largest Property Taxpayer ................................................................................................... 79
Revenues Sources By Fund .................................................................................................. 80
Long Range Financial Plans ........................................................................................................ 82
Long-Term Fiscal Objectives ................................................................................................. 89
Capital & Debt
Capital Expenditures & Capital Improvement Plan .................................................................... 92
Funding Source Summary .................................................................................................... 99
Projects By Funding Sources And Department ................................................................... 100
Debt ......................................................................................................................................... 105
Departmental Information
Staffing Summary ..................................................................................................................... 108
General Fund – Summary ......................................................................................................... 10 9
General Government
Mayor and City Council (101-41110) ............................................................................... 112
City Administration (101-41310) ..................................................................................... 11 3
City Clerk (101-41410) .................................................................................................... 115
Finance (101-41520) ....................................................................................................... 117
Legal (101-41610) ........................................................................................................... 119
Human Resources (101-41800) ....................................................................................... 12 0
Planning, Zoning & Community Development (101-41910) ............................................ 122
City Hall (101-41940) ...................................................................................................... 125
Public Safety
Law Enforcement (101-42100) ........................................................................................ 126
Fire & Rescue (101-42200) .............................................................................................. 128
Fire Relief (101-42202).................................................................................................... 130
Building Inspections (101-42400) .................................................................................... 131
Emergency Management (101-42500) ............................................................................ 133
Animal Control (101-42700) ............................................................................................ 134
National Guard (101-42800) ........................................................................................... 135
Public Works
Public Works Administration (101-43110) ...................................................................... 136
Engineering & Inspections (101-43115) .......................................................................... 137
Streets & Alleys (101-43120) .......................................................................................... 139
Ice & Snow Removal (101-43125) ................................................................................... 14 0
Shop & Garage (101-43127) ............................................................................................ 14 1
Street Lighting (101-43160) ............................................................................................ 14 2
Refuse Collection (101-43230) ........................................................................................ 143
Recreation and Culture
Senior Center (101-45175) .............................................................................................. 144
Park Operations (101-45201) .......................................................................................... 145
Park Ballfields (101-45203) ............................................................................................. 146
Public Arts (101-45204) .................................................................................................. 147
Library (101-45501) ........................................................................................................ 148
Shade Tree (101-46102) .................................................................................................. 149
Special Revenue Funds – Summary .......................................................................................... 151
Cemetery Fund (215-49010) .............................................................................................. 152
Small Cities Development Program (SCDP) Fund (221-46500) ........................................... 154
Community Center Fund (226-4512x) ................................................................................ 155
Debt Service Funds – Summary ................................................................................................ 157
2015B G.O. Bond Sub-Fund (319-47000) ........................................................................... 158
2016A G.O. Bond Sub-Fund (320-47000) ........................................................................... 160
2017A G.O. Bond Sub-Fund (321-47000) ........................................................................... 162
2018A G.O. Bond Sub-Fund (322-47000) ........................................................................... 164
2019A G.O. Bond Sub-Fund (323-47000) ........................................................................... 166
2020A G.O. Bond Sub-Fund (324-47000) ........................................................................... 168
Closed Debt Service Funds ................................................................................................. 170
Capital Project Funds – Summary ............................................................................................. 171
Capital Project Fund (400-4xxxx) ........................................................................................ 172
Street Lighting Improvement Fund (403-43162) ................................................................ 174
Park & Pathway Improvement Fund (404-45202) .............................................................. 175
Park Dedication Fund (405-45202) ..................................................................................... 176
Closed Capital Projects Funds ............................................................................................ 177
Enterprise Funds – Summary ................................................................................................... 179
Water Fund (601-4944x) .................................................................................................... 180
Sewer Fund (602-49480 & 602-4949x) ............................................................................... 182
Stormwater Fund (652-4948x) ........................................................................................... 186
Liquor Fund (609-4975x) .................................................................................................... 188
Deputy Registrar Fund (653-41990) ................................................................................... 190
Fiber Optics Fund (656-4987x) ........................................................................................... 192
Internal Service Funds – Summary ........................................................................................... 195
Facilities Maintenance Fund (701-00000) .......................................................................... 196
IT Services Fund (702-00000) ............................................................................................. 198
Central Equipment Fund (703-00000) ................................................................................ 200
Benefit Accrual Fund (704-00000) ..................................................................................... 202
Discretely Presented Component Unit Fund – Summary ......................................................... 205
Economic Development Authority Fund (213-46301) ........................................................ 206
Appendix
Community, Demographic, and Statistical Information ........................................................... 209
Property Tax Basics .................................................................................................................. 212
Truth-in-Taxation (TNT) ............................................................................................................ 215
Debt Guide ............................................................................................................................... 216
Minnesota Statutes .................................................................................................................. 225
Utility Rates .............................................................................................................................. 229
Capitalization Thresholds & Useful Lives .................................................................................. 230
Tax Capacity, Tax Levy, & Tax Rate History .............................................................................. 231
Useful Terms (Glossary) ........................................................................................................... 232
Acronyms ................................................................................................................................. 241
DIRECTORY OF PUBLIC OFFICIALS
MAYOR & CITY COUNCIL
Position Name Term Expires Contact Information
Mayor Lloyd Hilgart 12/31/2024 Lloyd.Hilgart@ci.monticello.mn.us
Council Charlotte Gabler 12/31/2026 Charlotte.Gabler@ci.monticello.mn.us
Council Tracy Hinz 12/31/2026 Tracy.Hinz@ci.monticello.mn.us
Council Lee Martie 12/31/2024 Lee.Martie@ci.monticello.mn.us
Council Sam Murdoff 12/31/2024 Sam.Murdoff@ci.monticello.mn.us
CITY STAFF
City Administrator ............................................................ Rachel Leonard
Public Works Director/City Engineer ................................... Matt Leonard
Finance Director ......................................................... Sarah Rathlisberger
Community Development Director .............................. Angela Schumann
Parks, Arts & Recreation Director .......................................... Tom Pawelk
City Clerk ...................................................................... Jennifer Schreiber
Human Resources Manager ................................................... Tracy Ergen
Communications & Marketing Specialist .............................. Haley Foster
Street Superintendent ........................................................ Mike Haaland
Parks Superintendent .................................................... Josh Berthiaume
Utilities Superintendent ............................................................ Mat Stang
Finance Manager ..................................................................... Liz Lindrud
Deputy Registrar Manager .............................................. Carolyn Granger
Liquor Store Manager ..................................................... Randall Johnsen
Community Center Program & Operations Manager .............. Sara Cahill
Economic Development Manager ............................................ Jim Thares
Chief Building Official ................................................. Ron Hackenmueller
Fire Chief .............................................................................. Mike Mossey
EXTERNAL CONSULTANTS
Wright County Sheriff ........................................................ Sean Deringer
NAC Planning Consultant .................................................. Steve Grittman
Northland Securities Financial Advisor ............................... Tammy Omdal
Veolia Environmental Services ............................................. Ross Stevens
Fibernet Management Services ............................ Arvig Communications
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DISTINGUISHED BUDGET PRESENTATION AWARD
The Government Finance Officers Association of the United States and Canada (GFOA) presented
an award of Distinguished Budget Presentation to the City of Monticello for its annual budget for
the fiscal year beginning January 1, 2023. The city has submitted its budget for consideration
since 2009 and has received this award each year.
To receive this award, a governmental unit must publish a budget document that meets program
criteria as a policy document, an operations guide, a financial plan, and a communications
device.
This award is valid for a period of one year only. We believe our current budget continues to
conform to program requirements, and we are submitting it to GFOA to determine its eligibility
for another award.
GOVERNMENT FINANCE OFFICERS ASSOCIATION
Distinguished
Budget Presentation
Award
PRESENTED TO
City of Monticello
Minnesota
For the Fiscal Year Beginning
January 01, 2023
Executive Director
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STRATEGIC GOALS & STRATEGIES
The City of Monticello continues to use strategic planning as an important mechanism for
balancing the needs and wants of the community with sound fiscal management. Strategic
planning is also the first step in the annual budget process. Annually, the City Council
meets to reaffirm or adjust priorities and policy positions and to align these overarching
goals with direction for city staff.
Leadership staff developed the city’s Mission Statement, Strategic Goals, and Core Values,
which were affirmed by the Council at the strategic planning worksession in 2021. The
goals were formed from feedback received from residents related to two major
characteristics of Monticello: nearly half of the tax base is reliant on an electric-generating
plant and the city originated from a river settlement with a strong community connection
to history. The city is tasked with needing to balance the need to replace tax base that will
eventually go away when the power plant closes in the future with the desire to maintain
its community character
•The mission of the City of Monticello is to responsibly use our resources to
provide quality services and programs that foster a dynamic community
rooted in history and preparing for a vibrant future.
Mission Statement
1.Create & Preserve Sustainable Livability
2.Build a Connected Community
3.Strengthen our Image as a Destination
4.Support a Vibrant Economy
5.Be a Regional Leader
6.Invest in People
Strategic Goals
•Leadership
•Stewardship
•Responsiveness
•Integrity
•Community
Core Values
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The worksession in 2021 also brought about the idea of the “Big 6”:
•Improvements to the city’s downtown with a focus on Block 52
•A new operations, maintenance, and storage facility for the Public Works department
•The Pointes at Cedar (formerly known as Chelsea Commons) 100-acre development &
recreation area
•Bertram Chain of Lakes Regional Park, a joint venture with Wright County of which the
city is responsible for the athletic park area
•A Water Treatment Facility to treat the city’s water supply
•Fallon Avenue Improvements, including trunk lines that are necessary for future
development to the South and for increased pedestrian safety
Through the 2024 budget process, Council and staff considered the impacts these projects
would have on the next 10 years. While these are long-term projects, the city’s 2024 budget
supports continuation of three of these projects, while others are on hold until triggered by
development or external funding. A desire for sustainable growth, as highlighted in the city’s
Monti:2040 Comprehensive Plan, continues to drive decision making along with a funding
approach that will avoid large impacts to the property tax levy each year without delaying vital
projects.
The city has completed numerous plans to help guide future growth and spending priorities. A
chance to develop additional planning for the future decommissioning of the Xcel Energy
Nuclear Generating Plant, which makes up just under half of the city’s tax base, became a
reality in 2021 when the city was awarded a grant from the MN Department of Employment
and Economic Development as part of its Community Energy Transitions (CET) grant program.
The city was able to engage in studies to help determine the most advantageous growth areas
along with guidelines to the best way to execute the plans.
Downtown
Revitalization
New Public
Works Facility
The Pointes at
Cedar
Bertram Chain
of Lakes
Regional Park
Development
Fallon Avenue
Improvements
Water
Treatment
Facility
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Plans for service provision and growth & development:
1. Monticello 2040 Vision + Comprehensive Plan - Adopted 2020.
The Comprehensive Plan is a tool for guiding the growth, redevelopment, and improvement of
Monticello. The Comprehensive Plan outlines the vision for the community. Development of the
Monticello 2040 Vision and Comprehensive Plan began with the visioning phase in 2019 and
concluded in 2020 with the plan formation based on the visioning.
2. Mobility & Connectivity
The city’s Transportation Plan is encompassed within Chapter 4 of the Monticello 2040 Plan, and
is a guide that outlines the goals, policies, and transportation strategies to improve mobility and
connectivity in Monticello by continuing to build a safe and efficient multimodal transportation
system that strengthens the economy and enhances quality of life. Ongoing major transportation
efforts include:
• Continued evaluation of collector street network improvements for safety, intersection,
and congestion improvements.
• Progress on mobility and connectivity improvements outlined within the Downtown
Small Area Plan, including the connection of Walnut to River Street.
• Work with regional and state partners on alternatives and projects related to Highway
25 congestion relief and I-94 capacity expansion.
• Extension of School Boulevard west from current terminus.
• Installation of new roundabout locations throughout the city.
• Street improvements from rural to urban standards for certain streets including Fenning
Avenue, Fallon Avenue, and Edmonson Avenue, among others.
3. Parks & Pathways Plan – Adopted 2011, Update in Progress.
The Monticello Parks and Pathways Plan identifies the city’s objectives for parks, pathway, and
recreation s planning and development. The Plan also identifies strategies for building on and
maintaining the existing parks infrastructure. The city has completed a Pathway Connections
map, a planning document related to pathway connections within the larger system in direct
response to the objectives identified within the plan. The 2040 Plan provides updates but does
not duplicate the detailed analysis in this plan. A Parks Master Plan is recommended by the
Monticello 2040 Plan to update the detailed portion of this plan, which will conclude in late
2024 with adoption by the city council after planning began using consultant Bolton & Menk in
late 2022.
4. Bertram Chain of Lakes Regional Park Master Plan – Adopted 2016.
The Monticello 2040 Comprehensive Plan and 2011 Park & Pathway Plan recognize the Bertram
Chain of Lakes Regional Park as a significant component of the community’s quality of life
initiatives. The concept plan for the full regional park and athletic complex was adopted in 2011
as part of the Park and Pathway plan. A Master Plan for the Bertram Chain of Lakes Regional
Athletic Complex was approved in 2016. Phase I was completed in 2019, and Phase 2 began in
2023 with final completion planned for 2024.
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The athletic park offers convertible open field space for soccer and lacrosse. Following the first
phase of improvements in 2019, many local athletic teams made Bertram their home field in
2020. Phase 2 includes the construction of ADA-accessible gravel trails/parking spaces,
recreation support facilities, and transportation enhancements to the existing athletic complex
including a new gravel entrance and parking lot, water fountains and temporary restrooms, and
extension of irrigation lines. Future phases will focus on additional infrastructure buildout both
for active players and spectators.
Local Option Sales Tax: The City has identified a local option sales tax, which will be on the ballot
in the general election in November 2024, as a potential mechanism to fund future park
improvements. The Bertram Athletic Park is identified as one of the projects proposed to be
included in the local option tax.
5. Downtown Small Area Plan – Adopted 2017.
The Downtown Small Area Plan is an implementation plan which integrates market,
transportation, and land use considerations for the purpose of creating a vibrant downtown
district. The city and Economic Development Authority utilize the Downtown Small Area plan to
implement strategies to realize plan goals. The Small Area Plan has led to further planning in the
Downtown Area, including adoption of Walnut Street Corridor Plan, which guides investment
and improvement for Walnut Street between the river and I-94. The Downtown Small Area Plan
is incorporated in the Monticello 2040 Vision & Comprehensive Plan.
6. The Pointes at Cedar Small Area Plan – Adopted 2022.
Following the update to the City’s Comprehensive Plan in 2020, which highlights the desire to
grow from within, the Pointes at Cedar Master Plan was developed to guide the preparation of
plans and specifications for construction of the public park and open space improvements in the
area between Cedar Street, Edmonson Avenue, Chelsea Road, and School Boulevard. A Small
Area Plan for The Pointes at Cedar in September 2021. The Small Area Plan provides a guide for
both public and private investments in the development area. Following adoption of the Small
Area Plan, the city completed a planning process for the public areas of the development project
area, which led to the adoption of The Pointes at Cedar Master Plan. The Master Plan is
intended to provide greater detail on the public spaces anchoring the project, including the
identification and location of amenities and recreational features. The Master Plan then serves
as the foundation for the development of plans and specifications for the public improvements
at The Pointes.
7. Strategic Transition Plan – Adopted 2022.
The Strategic Transition Plan (STP) is the culmination of the numerous studies and plans
completed by the City in 2021 and 2022. Because the City’s largest taxpayer is an electric-
generating facility, the STP connects these plans and previously adopted policy documents by
evaluating their content for specific strategies that will support a successful transition away
from an energy-based economy. The STP is a document identifying implementation measures
from each plan which support a sustained and successful transition effort. The desired
document would also draw relationships between the new and previously adopted studies as
they relate to community transition.
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8. Comprehensive Water System Plan – Updated 2022.
A water distribution system model was created to evaluate the existing water system. The water
system plan was then developed using this model to identify water system capital
improvements necessary to serve future land use designations in accordance with the city’s
Comprehensive Plan. In 2022, the City conducted an analysis of its water system to determine
improvements necessary for future expansion of the City. These improvements include necessary
water main improvements, trunk lines, additional storage, and other water distribution assets.
9. Comprehensive Sanitary Sewer System Plan – Updated 2022.
The sanitary sewer comprehensive plan identifies the existing sanitary sewer system and
projected future wastewater flows and service areas based on future land use designations in
accordance with the city’s Comprehensive Plan. Several individual sanitary sewer studies were
developed after the adoption of this plan in response to development. The Sanitary Sewer Plan
was updated in 2022 as a concentrated effort to provide the City of Monticello with working
knowledge of the flow characteristics of the sanitary sewer system, identify issues, concerns, or
deficiencies with the collection system, and recommend changes or improvements that would
address issues and benefit system operation for the long term.
10. Storm Water Pollution Prevention Program - Adopted 2007.
In 2005 the City of Monticello was designated as a regulated small municipal separate storm
sewer system (MS4) under Minnesota Rules, Chapter 7090. This required the city to obtain a
National Pollutant Discharge Elimination System/State Disposal System (NPDES/SDS) storm
water permit, and to develop and implement a Storm Water Pollution Prevention Plan (SWPPP)
to reduce the discharge of pollutants, including sediments, from our storm sewer system to the
maximum extent practicable.
The city is continuing to implement the required six minimum control measures (MCM’s) as
follows:
A. Public Education and Outreach,
B. Public Participation and Involvement,
C. Illicit Discharge Detection and Elimination,
D. Construction Site Stormwater Runoff Control,
E. Post-Construction Stormwater Management Measures; and,
F. Pollution Prevention/Good Housekeeping Measures.
Zoning, subdivision, and illicit discharge ordinances were adopted related to grading, drainage,
erosion control, and storm water management to meet current MPCA requirements per the
city’s new MS4 permit issued on October 29, 2021.
11. Comprehensive Water Resource Management Plan - Updated 2019.
The Comprehensive Water Resource Management Plan was developed to meet local watershed
management planning requirements of the Metropolitan Surface Water Management Act and
Board of Water and Soil Resources Rules 8410. It was developed to be in conformance with the
requirements of Metropolitan Council requirements, and applicable State and Federal laws. The
7Table of Contents
plan and its referenced literature are intended to provide a comprehensive inventory of
pertinent water resource related information that affects the city and management of those
resources.
12.Wellhead Protection Plan (Part 1 and 2) - completed 2016.
The goal of the Wellhead Protection Plan is to prevent human-caused contaminants from
entering the water supply wells and to protect all who use the water supply from adverse health
effects associated with groundwater contamination. The preparation of the city’s plan was
required by Minnesota Rules 4720.5100 to 5720.5590. Part 1 was completed in 2015 and Part 2
was completed in 2016. The plan is anticipated to be updated by 2026 as determined by the
Minnesota Department of Health.
13.Plan Requirements and Design Guidelines (“Design Manual”) - Updated 2022.
These guidelines were established for developers of property within the City of Monticello. The
guidelines provide design standards, specifications, and detail plates for the design of
infrastructure improvements, street, utility, and site work construction.
These guidelines are referenced in the city’s zoning and subdivision ordinances related to
grading, drainage, erosion control, and storm water management. The Design Manual is
updated as needed for new design regulations and requirements.
14.General Specifications and Standard Detail Plates for Street and Utility Construction -
Updated 2017.
These specifications represent the city’s requirements for construction of public streets and
utility systems.
15.Interchange Planning Study – Ongoing.
The Interchange planning study will determine a reasonable location or locations for a future I-
94 Interchange within the city west of TH 25. The Monti:2040 Comprehensive Plan recognizes
that Northwest Monticello, which includes the CSAH39 to Orchard Road corridor, is a primary
focus for future development and further cites the Future Interchange as a critical component of
understanding growth potential and land use in the Northwest Area. However, CET grant funds
were used to study the feasibility of development to the East side of city limits as well.
16.Central Mississippi River Regional Planning Partnership (CMRP) – Ongoing.
A series of meetings have taken place with representatives invited from area jurisdictions to
discuss regional planning and economic development. A joint power agreement was adopted by
the city in December 2015, with a shift in focus from strictly transportation to broader regional
planning taking place a few years later. A TH 25 area transportation study was completed in
2018 and identified options for near-term and long-term improvements to the corridor.
17.Natural Resource Inventory & Assessment - Adopted 2008.
The purpose of the Natural Resource Inventory and Assessment (NRI/A) is to identify existing
natural resources within the City of Monticello and its growth area (the Monticello Orderly
8Table of Contents
Annexation Area), inventory these resources, and assess the resource quality. These resources
are then considered and evaluated during growth/development.
18.Economic Development Strategic Plan - Updated 2018.
The EDA adopts a strategic work plan annually, which directs EDA staff focus and resources over
the following three years.
Plans for Facility and Infrastructure Maintenance:
1.Wastewater Treatment Facility Biosolids Dewatering, Energy Efficiency, Headworks and Site
Improvements Feasibility Report – Adopted 2012.
Future wastewater improvements identified in the Capital Improvement Plan include the
demolition of obsolete equipment and installation of an influent lift station and grit removal, an
additional SBR tank, and a gasifier tank.
2.Overall Street Reconstruction Program – Adopted 2004, ongoing as part of capital
improvement plan.
The 2024-2028 Capital Improvement Plan includes projects related to the program, with various
projects planned throughout the city, which typically occur every other year.
3.New Public Works Facility
The city completed a study of the public works facility in 2007 which identified the need for
additional storage and more efficient configuration of the public works department. Due to the
recession shortly thereafter, the project never gained traction, but was recently revived because
of need. Concept plans have been drafted, and land was purchased in 2021 for the future
facility. An architect was hired in late 2022 for design of the facility, a construction manager
was brought on board in 2023, and construction is included in the 2024 budget. Construction is
currently anticipated to be complete in 2025.
4.Transportation Projects
TH25 Safety and Lighting Improvements – MnDOT is proposing an interim improvement project
that mixes permanent and temporary elements to promote traffic calming and accessibility.
MnDOT is also installing additional streetlights along TH25. The new lighting will be added at
neighborhood entrances south of School Boulevard as well as at the J-turn located
approximately a quarter of a mile down the road.
The Monticello EDA sold 10 parcels in downtown’s Block 52 in 2022 and entered into a final
development agreement with a developer to redevelop the central block next to the only
Mississippi River crossing within 20 miles. While much of the interior block redevelopment will
be handled by private investment, the city included a street improvement project to River and
Walnut streets in the 2023 budget, which will be completed in 2024. Wright County planned for
an improvement project to County Road 75 West (Broadway), which is adjacent to Block 52 in
2023, and the city budgeted funds for additional improvements to the vital connection to
downtown. Additionally, Wright County is completing improvements on County Road 75 (East)
in 2024, of which the city has budgeted for its contributions to the project.
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The city was successful in securing grant funding for improvements to School Boulevard from
TH25 to Country Lane including the construction of roundabouts at Cedar Street and Edmonson
Avenue. This project is included in the 2024 CIP and budget.
The city also secured funding from the State of Minnesota and Wright County for flashing yellow
arrows to be installed at various intersections along State Highway 25 and County Road 75. This
project began in 2023 and will conclude in 2024.
Finally, the city was awarded grant funding to improve pedestrian safety along County Road 39
West from Chelsea Road to Elm Street. Design will begin in 2024 with construction planned for
2025. The city will also complete design work for improvements to the Great River Regional Trail
in 2024 with construction currently anticipated in 2025 and 2026. Grant funding is being applied
for to help finance this project.
Financial Plans:
1.Annual Budget - Adopted each December.
2.Capital Improvement Plan - Updated and adopted each year; most recently for 2024 -2028.
3.Long-term Financial Management Plan – Model was approved in 2022 and will be updated
annually.
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This first phase of the Comprehensive Plan
process, the Visioning phase, included a
community engagement process to identify
common values, growth aspirations and a vision
to inform the planning direction for the next
20 years. The vision, value statements and
preferred development scenario will serve as the
foundation for creating the new Comprehensive
Plan during the second phase of the planning
process. The Comprehensive Plan provides a set
of goals, policies and strategies for achieving
Monticello’s vision for the future.
PHASE ONE | JANUARY 2020
In 2040 the City of Monticello is an inclusive community focused around sustainable
growth while maintaining its small-town character. Monticello is a Mississippi River
town known for its schools, parks, biking and walking trails and vibrant downtown.
Monticello is an evolving, friendly and safe community that respects the quality of its
environment, fosters a sense of belonging and connection, encourages a healthy and
active lifestyle and supports innovation to promote a prosperous economy.
A balanced land use and transportation framework that provides options and connectivity.
A range of attainable housing options in terms of type, cost, and location.
A respected school and education system serving the community.
A healthy community focused on physical and mental health and wellness of its residents.
A safe, clean, and beautiful community
supported by caring and helpful residents.
A network of parks, open space and trail connections that provide recreation opportunities.
An inclusive community welcoming people of all ages, races, religions and ethnic backgrounds.
A diversified and strong local economy competitive at regional, state and national levels.
A vibrant downtown that embraces the River and provides a focal point for the community.
A thriving arts and culture scene that reflects the creativity of the community and supports a sense of place.
VISION STATEMENT
VALUE STATEMENTS
VISIT
CI.MONTICELLO.MN.US/MONTI2040
TO LEARN MORE!
PREFERRED SCENARIO
PRIORITYGREENWAYSMIXED RESIDENTIAL/COMMERCIAL
INDUSTRIALCOMMERCIAL
PLANNED DETACHED
RESIDENTIAL DEVELOPMENT INTERCHANGE
LEGEND:DETACHED RESIDENTIAL
MIXED COMMERCIAL/OFFICE/LIGHT INDUSTRIALATTACHED RESIDENTIAL RIVER
ACCESS
• Sustainability - Focus on sustainability, open space and wetland
preservation throughout City.
• Infill Development - New service commercial and light industrial infill.
• Conservation Neighborhoods - Single-family housing developed as
conservation subdivisions in a clustered fashion mitigating impacts to
sensitive areas.
• Industrial Expansion - Full build out and expansion of Otter Creek
Industrial Park and growth around future Interchange.
• Multi-Family Housing - New multi-family infill development near core
of downtown and other focus areas.
• New School - New elementary and middle school campus with
environmental focus.
• Downtown - Downtown plan implementation thriving with new
commercial, mixed-use and public realm improvements.
• Mississippi River - Focus on River with new access, connections and
riverfront trail.
• New Employment Center - New industrial business park developed
around new interchange with green technology, renewable energy,
manufacturing and other uses.
• Xcel Facility - The Xcel Monticello Nuclear Generating Plant is
licensed through 2030 and will seek relicensing to 2040.
• Annexation Area - Portions of the Orderly Annexation Area are
designated as an Urban Reserve for future development. Development
would likely include conservation single-family cluster subdivisions.
Note: The Preferred Scenario guidance and mapping provided in the Vision
Report will be further refined during the Comprehensive Plan process. This
map is not the City of Monticello’s final Land Use Plan. This map provides
initial guidance for the next phase of the project, the Comprehensive Plan,
and will be further detailed and refined.
The preferred development scenario is the result of community feedback on the four previous scenarios and the community’s vision.
The community envisions Monticello in 2040 as an environmentally and economically sustainable community that has experienced
strong, balanced growth.
A
B
C
D
E
F
G
H
I
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Development Assumptions
Key Preferred Scenario Aspects
URBANRESERVE
INCREMENTAL, SUSTAINABLE Growth Scenario
Downtown Focus
New School
Industrial and Employment
Conservation Neighborhoods
Retail and Commercial
Trails and Open Space
VISIT
CI.MONTICELLO.MN.US/MONTI2040
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Multi-Family10-18 Unit/Acre10-18 Unit/Acre
Medium and Small Lot Conservation Developments4-10 Units/Acre4-10 Units/Acre Potential School Site withEnvironmental Focus
Medium and Small Lot Conservation Developments4-10 Units/Acre4-10 Units/Acre
Otter Creek
Industrial Park
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11Table of Contents
PRIORITIES & ISSUES
The city’s priorities were redefined in the Monti:2040 Comprehensive Plan adopted in 2020.
This Comprehensive Plan highlights the city’s desire to grow from within before expanding out
by focusing on three key themes: Sustainability, Community Health and Sense of Place. The
Comprehensive Plan is the primary influence in financial planning.
Monticello, like all other levels of government, had to learn how to operate differently during
the COVID-19 pandemic. The basic services a government offers cannot be eliminated or
postponed, so operations shifted greatly and unexpectedly. After a few years of resilience and a
transition back to other priorities, the 2024 budget reflects a more routine approach to
operations while at the same time retaining efficiencies and other strategies discovered during
the pandemic. While the city has mainly returned to routine levels of service and funding, the
Community Center Fund was slower to rebound. Revenues in the Community Center Fund are
close to pre-pandemic levels, however, the costs to generate that level of revenue have
increased greatly. As is fiscally responsible, revenues are budgeted conservatively, and
expenditures are estimated liberally to ensure sound financial position.
The American Rescue Plan Act of 2021 (ARPA) provided just over $1.5 million directly to the
city. All ARPA funds were used in 2021 through 2023 for wages and benefits at the Monticello
Community Center. Going forward, the Deputy Registrar Fund has been identified as a source of
financial support to the Community Center Fund while opportunities for additional revenue or
decreasing expenditures are sought.
The city changed its strategy for budgeting in 2021 from a department-by-department
approach to an entity-wide “bucket” or “pieces of a puzzle” approach including the following
areas:
Notable changes in service levels and fees include:
Personnel:
•Overall: A cost of living adjustment (COLA) was applied to the wage scales in 2024.
Budget impact: $235,200.
Personnel
Notable Operating Expenditures
Equipment
Capital Projects
12Table of Contents
•Engineering: Reclassification of Project Engineer position to an Assistant City Engineer
position. Budget impact: $7,000.
•Park Operations: Promotion of one Parks Operator to a Parks Foreman position. Budget
impact: $7,800.
•Community Center: Increase hours and pay grade of part-time League Manager to
reclassify the position to a Recreation Coordinator. Budget impact: $40,000.
Notable Operating Expenditures:
•City Clerk: Administration of 2024 elections (Presidential Nominating Primary in March,
Primary in August, General in November). Budget impact: $60,000.
•City Hall: Study of City Hall layout to maximize building space. Budget impact: $10,000.
•Human Resources: Increased contribution to IT Fund for implementation of Perform
(performance review) module in NeoGov software. Budget impact: $10,000.
•Law Enforcement: Increased costs (hourly rate and daily patrol hours) to the contract
with the Wright County Sheriffs Office to provide police protection to the city. Budget
impact: $616,000, offset by $400,000 of Public Safety Aid from the State of Minnesota.
•Park Operations: Completion of master plan which began in 2022. Budget impact:
$70,000.
•Park Operations: Annual pathway maintenance (had been eliminated or greatly reduced
in 2021-2023). Budget impact: $150,000.
•Library: Installation of new carpeting. Budget impact: $40,000.
•Shade Tree: Inventory and treatment of Emerald Ash Borer (EAB) infected trees. Budget
impact: $120,000.
Equipment:
•Streets: The streets department, through the Central Equipment Fund, budgeted for a
two-ton pickup with hoist & dump box, a tack trailer and a 40” cold planer. Budget
impact: $167,000.
•Parks Operations: The parks operations department, through the Central Equipment
Fund, budgeted for a one-ton pickup, walk-behind mower, and Kifco water wheel.
Budget impact: $125,000.
•Water: The water department budgeted for a portable generator. Budget impact:
$150,000.
•Sewer: The sewer department budgeted for a new gasifier tank at the Wastewater
Treatment Plant. Budget impact: $700,000.
Capital Projects:
•Downtown Roadway & Pedestrian Improvement Projects: Connect Walnut and River
Streets, improve sidewalks and landscaping on Broadway, improve traffic flow at the
Hwy 25 & Broadway Intersection and relocate utilities in and around Block 52
underground. Budget impact: $5,650,000.
•Public Works Facility: The city hired an architect in 2022 and a construction manager in
2023 to design and plan for a new Public Works Facility with anticipated construction in
2024 and 2025. Budget impact: $30,000,000.
13Table of Contents
•Broadway East Improvement Projects: Repave the street and install pedestrian and
landscaping enhancements on East Broadway from Hwy 25 to Fenning Avenue. Budget
impact: $3,400,000.
•School Boulevard Improvements and Roundabouts: Grant funding was received to
install two roundabouts on School Boulevard at the intersections with Cedar Street and
Edmonson Avenue and repave the section of School Boulevard from Hwy 25 to Country
Lane. Budget impact: $2,495,000.
•7th Street Improvements & Retaining Wall: Replacement of retaining wall on the south
side of east 7th street and installation of new sections of sidewalks. Budget impact:
$750,000.
•Ditch 33 Improvements: Rehabilitation and improvements to a failing ditch to the east
of the city. Budget impact: $1,975,000.
•Water Treatment Facility: The city was awarded state funding for construction of a new
water treatment facility. 2024 activity consists of design phase work. Budget impact:
$1,000,000.
Furthermore, the city evaluates utility rates annually. The following increases were adopted in
the 2024 Fee Schedule and incorporated into the 2024 budget.
•Water: Usage charges were increased by 8% in anticipation of large upcoming capital
improvements, including a new water treatment facility. Access and truck charges
increased 4%.
•Sewer: Usage charges increase 3% for base and usage charges. Access and trunk charges
were also increased by 3%.
•Stormwater: Stormwater fees increase 5.5% in 2024, from $4.50/drainage unit to
$4.75/drainage unit to fund significant capital costs coming up in the next couple years.
•Garbage & recycling: The garbage charge will increase in 2024 by approximately 3%,
while recycling will increase 6% from $5.17 to $5.50. These rate increases match the
hauler’s rates to the City per contract.
The city’s estimated population is now more than 15,000. A city of Monticello’s size,
operations, tax base composition, and location require careful planning for sustainable and
responsible growth. The valuation of the Xcel Electric Generating Plant creates large
fluctuations in the tax statements of city businesses and residents. The city has many
competing priorities in terms of capital improvements and support for development that need
to be balanced with the financial appetite of the property taxpayers. The Council’s discussions
in the 2024 budget process centered around a balance of investing in some areas now with
waiting to invest in certain areas until additional debt is paid off or external grant funding is
obtained.
14Table of Contents
15Table of Contents
2024 BUDGET
OVERVIEW SUMMARY
City of MonƟcello, Minnesota
Property Taxes
18%Tax Increments
0%
Franchise &
Other Taxes
1%
Sale of Goods
10%
Licenses &
Permits
1%
Intergovernmental
Revenues
8%
Charges for
Services
17%
Fines & Forfeits
0%
Special
Assessments
0%
Miscellaneous
2%
Contributed
Capital
0%Operating
Transfers In
2%
Debt Proceeds
41%
2024 Revenues by Category - All Funds
General Fund
$8,640,000
66%
MCC Operations
$525,000
4%
Capital
$1,882,825
14%
Debt Service
$2,026,175
16%
2024 Property Tax Levy
Personnel
Services
11%
Supplies
9%
Other Services
& Charges
16%
Capital Outlay
59%
Debt Service
4%
Operating
Transfers Out
1%
2024 Expenditures by Category - All Funds
Fund Type 2023 2024 2023 2024
General 11,480,000$ 12,757,000$ 11,480,000$ 12,757,000$
Special Revenue 2,172,000 2,108,000 2,153,000 2,089,000
Debt Service 2,268,000 2,280,000 2,607,000 2,606,000
Capital Project 12,540,000 37,016,000 15,375,000 43,302,000
Enterprise 15,962,000 17,515,000 20,409,000 18,984,000
Internal Service 1,705,000 1,595,000 2,356,000 1,362,000
Component Unit 987,000 765,000 1,823,000 796,000
Total 47,114,000$ 74,036,000$ 56,203,000$ 81,896,000$
Total Budget
Revenues Expenditures
16Table of Contents
17Table of Contents
BUDGET OVERVIEW
INTRODUCTION
The budget is a tool; how this versatile tool is used depends on the stakeholder. Policy makers
use the budget to provide direction on service levels and place limits on spending. For
managers, the budget offers benchmarks for measuring performance and assessing
stewardship. To community advocates, the budget conveys visibility as to whether their
concerns are being addressed. Universally, the budget is an essential tool for communicating
the city's plans, policies, procedures, and objectives regarding the services to be delivered and
the assets to be acquired in the upcoming and future fiscal years. The budget’s effectiveness is
meaningfully influenced by the conviction of the various stakeholders using this dynamic tool.
BUDGET POLICY AND STRATEGY
This budget document was prepared after analyzing and evaluating requests from various
departments and budget units. The content represents the requested financial support for the
operation of the City of Monticello for the upcoming fiscal year. Revenue estimates are
conservative and realistic, based on historical trends with greater weight placed on the most
current years. The importance of a sound revenue picture cannot be overstated.
The City of Monticello provides a range of services to the community, including police
(contracted) and fire protection; street maintenance; snow and ice removal; water, sewer and
stormwater utility services; parks, arts, and recreation amenities (including community center)
and programming; and administrative and planning services. In addition, the city owns and
operates a department of motor vehicles (DMV), municipal off-sale liquor store (Hi-Way
Liquors), and a fiber optic network (FiberNet). The level of service provided by the proposed
2024 budget is as currently enjoyed by the community. City Council and city staff used the goals
set during the strategic planning process to direct the development of the 2024 budget.
STRATEGIC OR KEY INITIATIVES
The City of Monticello provides a full range of municipal services, as listed in the previous
paragraph, and as authorized by state statute. Monticello is fortunate to have many assets,
including a beautiful setting, an excellent location, a rich heritage, and a talented population.
The city seeks to use, preserve, and enhance these assets in building a great, affordable place to
live, work, and recreate. The city will fulfill the goals below to achieve this mission:
1.Maintain a low tax rate while providing the best possible service.
The 2024 property tax levy increase of 8.5% was slightly higher than the tax capacity value
increase of 8.2%, creating a minor (0.2%) increase in the city’s tax capacity rate. 2024 Budget:
The city levy increases $1,024,000 (8.5%) to $13,074,000 and the Housing and Redevelopment
(HRA) levy increases $49,000 (12.2%) to $451,000. Combined (city + HRA) tax levy increase:
$1,073,000 (8.6%). The tax levy rate is the third lowest of the 17 cities in Wright County.
2.Develop and maintain an unmatched system of parks, trails, and recreational facilities,
including the unique assets of the Monticello Community Center, the Mississippi River, and
conversion of the Bertram Chain of Lakes (BCOL) property into a regional park.
18Table of Contents
In partnership with the county, the city acquired park land, which is roughly 50% designated for
non-athletic purposes and 50% designated for athletic purposes. The city also maintains 365
acres of park land and 45.0 miles of trails. 2024 Budget: $75,000 design work for Great River
Regional Trail improvements, $12,000 bike route map.
3.Maintain the city sidewalks and streets by following an annual seal coat and crack seal
program and by overlaying streets before they are beyond repair and need replacing.
Emphasis is placed on safety by ensuring stoplights are functioning optimally.
The city’s pavement management program identifies varying condition levels of every street.
The 2024 General Fund includes $115,000 for a fog sealing maintenance project, and the Capital
Projects fund is utilized for improvement projects. 2024 Budget: $12,580,000 including
$5,650,000 for the Downtown Roadway & Pedestrian Improvements project, $3,400,000 for the
Broadway East Improvements project, $2,495,000 for the School Boulevard Improvements &
Roundabouts project, $750,000 for the West 7th Street Retaining Wall, and $285,000 for design
work on the CSAH 39 Pedestrian Pathway Improvements.
4.Develop and adopt a long-range transportation plan which will improve traffic flow around
and through the city.
Monticello is one of three cities (along with two counties and four townships) taking part in
regional planning and economic development initiatives, including a study to identify an
additional or expanded interstate interchange site and Mississippi River crossing. The city is also
an active, due-paying member of the I-94 Coalition. 2024 Budget: $14,800 – memberships.
5.Implement the downtown redevelopment plan which will maintain a downtown area that
combines a successful commercial district, community identity and heritage, and
connection with the Mississippi River.
The 2017 Small Area Study plan for downtown identified various options for re-creating the
city’s downtown. A major redevelopment began on Block 52 in 2023, and the city is completing
the Downtown Roadway and Safety Improvement project to supplement the investment from
the private developer. 2024 Budget: $5,650,000.
6.Seek to expand the supply of "step up" housing that allows people to upgrade their home
without leaving the community.
Staff is facilitating the development of additional residential home lots on the perimeter of the
city by working with developers and engineers. Infrastructure needs are regularly assessed and
incorporated into the city’s capital improvement plan. A housing needs and market demand
study was completed in 2020. 2024 Budget: $0; however, the Economic Development Authority
(EDA) has been working on various new TIF districts related to affordable housing. Additionally,
the State of Minnesota allocated housing aid to the city, which will be discussed in 2024 to plan
a use for this funding.
7.Seek to develop and attract a wide range of employment opportunities with a growing
emphasis on higher-paying jobs.
This concept promotes the city’s competitive advantages (i.e., low taxes, property availability,
transportation access, etc.) to businesses looking to move or grow. 2024 Budget: $0; however,
19Table of Contents
the EDA continues to prioritize new development opportunities through TIF districts, Greater
Monticello Enterprise Fund (GMEF) low-interest loans, and incentive packages via State funding.
8.Maintain high quality water and sewer treatment facilities.
With some of the lowest water and sewer rates in Minnesota, the city provides excellent services
from these two utilities to residents and businesses. The budget includes funds for the
construction of a water treatment facility, improvements to the wastewater treatment plant,
and ongoing system improvements in each fund. Monticello’s water is rated as one of the best
tasting in Minnesota. 2024 Budget: Water - $1,000,000 water treat facility construction design,
$150,000 purchase of portable generator, and $20,000 well pump house repairs; Sewer -
$250,000 annual improvements, and $700,000 wastewater facility gasifier tank replacement.
9.Provide unsurpassed access to information with high-speed internet, phone, and television
through the city-owned fiber optic network.
With settlement of the bondholder’s 2014 class-action lawsuit, the mission of the city’s
telecommunications utility will continue to adapt to competitive market conditions. The city
hired a third party to run FiberNet in July 2016. The contract with Arvig Enterprises was
extended in July of 2021 for an additional five years. 2024 Budget: $200,000 system expansion
to new neighborhood developments.
TOTAL BUDGET
The 2024 budget includes all the funds maintained by the city. Each fund is responsible to
account for a particular activity or activities. Each fund-type will be discussed within this
message and/or in the budget document.
The following compares the adopted 2023 and 2024 budgets:
Total revenues increase 157.1% and total expenditures increase 145.7% in 2024. General Fund
revenues and expenditures increase 11.1%, almost half of which is due to the property tax levy
increase. The decrease in special revenue activity reflects decreased activity for the Community
Center Fund now that American Rescue Plan Act (ARPA) funding has been fully spent. The slight
increase in debt service expenditures reflects the schedule amortization of outstanding bonds.
Capital project funds will incur higher expenditures due to projects for the Downtown Area,
Public Works Facility, Broadway East, School Boulevard, and 7th Street. The Liquor Fund will
Fund Type 2023 2024 2023 2024
General 11,480,000$ 12,757,000$ 11,480,000$ 12,757,000$
Special Revenue 2,172,000 2,108,000 2,153,000 2,089,000
Debt Service 2,268,000 2,280,000 2,607,000 2,606,000
Capital Project 12,540,000 37,016,000 15,375,000 43,302,000
Enterprise 15,962,000 17,515,000 20,409,000 18,984,000
Internal Service 1,705,000 1,595,000 2,356,000 1,362,000
Component Unit 987,000 765,000 1,823,000 796,000
Total 47,114,000$ 74,036,000$ 56,203,000$ 81,896,000$
Total Budget
Revenues Expenditures
20Table of Contents
transfer out $1,000,000 to support the Downtown project, and the Deputy Registrar will
transfer up to $100,000 to support operations of the Community Center Fund.
The following graphs display the revenues and expenditures attributable to each fund-type in
the 2024 Budget:
PROPERTY TAXES
The state of Minnesota has granted local municipalities the authority to levy taxes to fund
operations and debt payments. For the City of Monticello, the property tax levy accounts for
68% of revenues in the General Fund and 26% in the Community Center Fund. In 2024, debt
service funds will receive $2,026,175 in property taxes for principal and interest payments on
general obligation debt, which is $26,594 (1.3%) higher than the prior year. With the available
levy capacity, the city levied $407,406 (27.6%) more for the Capital Projects Fund in 2024. For
2024, the city's general property tax levy will increase to $13,074,000, by $1,024,000 (8.5%)
over the prior year. For the ninth consecutive year, the Economic Development Authority Fund
levied a Housing and Redevelopment Authority (HRA) special benefit levy. The HRA levy
increases to $451,000 (12.2%) from $402,000 in the prior year. When added together, the two
levies represent an 8.6% increase in property taxes.
The following table is a historical view of the tax capacity value, tax capacity rate and tax levy:
General
17%
Special
Revenue
3%
Debt
Service
3%
Capital
Project
50%
Enterprise
24%
Internal
Service
2%
Component
Unit
1%
2024 Revenues by Fund Type
General
16%
Special
Revenue
2%
Debt Service
3%
Capital
Project
53%
Enterprise
23%
Internal
Service
2%
Component
Unit
1%
2024 Expenditures by Fund Type
Tax Capacity Capacity Tax Capacity Rate City Tax HRA Levy
Year Value % Change Rate % Change Levy Levy % Change
2015 $23,882,689 30.9% 35.737 -20.0% $8,535,000 $0 4.7%
2016 $25,891,898 8.4% 34.470 -3.5% $8,925,000 $280,000 4.6%
2017 $27,583,160 6.5% 33.172 -3.8% $9,150,000 $280,000 2.5%
2018 $29,528,145 7.1% 32.332 -2.5% $9,547,000 $323,000 4.3%
2019 $29,076,227 -1.5% 34.262 6.0% $9,962,000 $348,000 4.3%
2020 $29,870,392 2.7% 34.968 2.1% $10,445,000 $355,000 4.8%
2021 $31,026,583 3.9% 35.659 2.0% $11,063,700 $366,300 5.9%
2022 $31,073,603 0.2% 36.536 2.5% $11,353,000 $388,000 2.6%
2023 $34,393,769 10.7% 35.035 -4.1% $12,050,000 $402,000 6.1%
2024 $37,229,832 8.2% 35.117 0.2% $13,074,000 $451,000 8.5%
21Table of Contents
Under contract, the Wright County assessor values all properties located within the city’s
corporate limits. This market value is applied to the class rates assigned by the state to
determine a property's tax capacity. The county estimates the city's tax capacity for taxes
payable in 2024 at $37,229,832, an 8.2% increase. The Xcel Energy nuclear power plant taxable
market value decreased 4.6% for 2024 to $743 million. The Xcel plant alone accounts for 40-
45% half of the city’s tax capacity. The city's property tax levy is divided by the tax capacity to
determine the city's tax capacity rate, which is then applied to each property's tax capacity to
determine the city’s tax. For 2024, the city's tax capacity rate is expected to increase 0.2% to
35.117.
The city currently does not have the authority to levy or collect local sales taxes or other types
of taxes under the state's tax system.
PERSONNEL SERVICES
The 2024 budget includes a few staffing changes including the replacement of two part-time
receptionists with one full-time employee, increased hours for part-time staff at the community
center and to the Recreation Coordinator position (previously a League Manager), and the
promotion of two positions (Project Engineer to Assistant City Engineer and a Parks Operator to
Parks Foreman). A 4.0% wage adjustment for all employees is included in the 2024 budget.
Public Works employees belong to a union, and their collective bargaining agreement was
renegotiated in late 2022 for the three years from January 1, 2023 through December 31, 2025.
Union and non-union employees participate in separate health benefit plans. The monthly
union health benefit is $1,281 per participant, and the monthly non-union health benefit is
$910 for single plan and $1,777 for family plan participants. The union’s plan requires a flat
premium for union employees regardless of participation. Staff will continue to explore ways to
reduce future premium increases to both the city and its employees.
The contribution rates to the Public Employees Retirement Association (PERA) will remain the
same in 2024 for both employer and employees. PERA rates: 7.50% of wages for employer and
6.50% for employee. The budget also calculates FICA and Medicare taxes at 6.20% and 1.45%
respectively.
GENERAL FUND
Expenditures
The following schedule displays 2024 budgeted General Fund expenditures by department
compared with the prior year budget:
Department 2023 2024 % Change
General Government 2,613,701$ 2,721,856$ 4.1%
Public Safety 3,278,367 3,882,331 18.4%
Public Works 2,823,966 3,027,573 7.2%
Sanitation 843,897 880,557 4.3%
Recreation & Culture 1,914,069 2,238,683 17.0%
Operating Transfers Out 6,000 6,000 0.0%
Total 11,480,000$ 12,757,000$ 11.1%
General Fund Expenditures and Other Uses
22Table of Contents
The 2024 General Fund budget increased 11.1% over the 2023 budget. Personnel services
includes wages and benefits for all full-time, part-time, and seasonal employees. This cost
category rises with wage and benefit inflation and additions to staff.
The chart below presents the 2024 budgeted expenditures allocated by function/department:
The largest department based on expenditures is the Public Safety Department. The 2024
Public Safety Department budget increased 18.4%. Public safety activities include law
enforcement, fire, building inspections, emergency management, National Guard, and animal
control. The city contracts with the Wright County Sheriff's department for law enforcement.
The 2024 contract includes a $18.25 increase in the hourly service rate for 60 hours per day
causing a 33.0% increase in budgeted expenditures in 2024. The fire and rescue activity budget
decreased 3.3% due to lower Central Equipment Fund rental charges in 2024. Other public
safety functions remain fairly consistent with the 2023 budget.
The Public Works Department is the second largest department in terms of budgeted
expenditures, and the streets & alleys activity budget is the largest activity within the
department. The 2024 budget for the Public Works department increased 7.2%. Streets & alleys
(+11.6%), street lighting (+10.3%) , and ice & snow (+7.8%). The Streets & Alleys and Ice & Snow
budgets increased with the full year of the additional streets department operator (hired in
May 2023). The Streets & Alleys budget also includes a fog seal maintenance project in 2024.
The street lighting department increased due to an increase in utility costs and usage with
completion of the Downtown improvements project.
The 2024 budget for general government activities increases 4.1%. The city clerk activity
increased 29.2% due to the administration of elections, and the human resources activity
increased 11.0% due to additional investment in software packages to promote efficiencies and
a shift away from paper-based performance reviews. The city hall activity decreased a reduced
allocation of facilities maintenance expenditures.
Recreation and culture expenditures increase by 17.0% in 2024. Replacement of carpeting in
library increases that activity’s budget by 131.4%. Shade Tree expenditures increase to combat
General Fund Expenditures &
Transfers -2024
General Government (21%)
Public Safety (30%)
Public Works (24%)
Sanitation (6.9%)
Recreation & Culture (18%)
Operating Transfer to EDA (0.1%)
23Table of Contents
the infestation of Emerald Ash Borer (EAB) found in the city’s trees. The parks operations
(+10.3%) budget reflects the return of pathway maintenance expenditures, which was cut the
past few years to help balance the budget, in 2024.
Sanitation expenditures include the costs of the contract with Waste Management for
residential garbage and recycling collection. The city’s contract with its residential garbage
hauler ends on May 31, 2025.
Including services for police, assessor, and legal services, other services, and charges account
for 52% of General Fund appropriations, mostly due to the increase in contracted police costs.
Appropriations for personnel services follow at 35% of the total, which can be contributed to a
general 4.0% wage and benefit inflation along with the reclassification of three positions.
Capital outlays include the internal rent payments to the Central Equipment Fund. Additional
equipment purchases will translate into higher lease payments, and completion of lease
payments for select pieces of equipment will cause a decrease.
The following table and graph provide perspective on expenditures and other uses for the
various General Fund expenditure classifications in the 2023 and 2024 budgets:
Department 2023 2024 % Change
Personnel Services 4,091,941$ 4,299,928$ 5.1%
Supplies 1,020,200 994,649 -2.5%
Other Services & Charges 5,728,859 6,888,923 20.2%
Capital Outlay 633,000 567,500 -10.3%
Operating Transfers Out 6,000 6,000 0.0%
Total 11,480,000$ 12,757,000$ 11.1%
General Fund Appropriations
Personnel
Services
35%
Supplies
7%
Other Services
& Charges
52%
Capital Outlay
6%
2024 Appropriations -General Fund
24Table of Contents
Revenues and other sources
Revenues and other sources supporting General Fund expenditures and other uses are
classified as follows:
The General Fund’s tax levy increases by 7.2%, while the General Fund’s portion of the
combined levy (city + HRA) decreases from 64.7% to 63.9%. Franchise & Other Taxes increase to
offset the increased cost of street lighting due to inflation. Increases in Intergovernmental
Revenues are attributable to aid from the State of Minnesota for public safety and to respond
to Emerald Ash Borer (EAB) found in city trees. The increase in Charges for Services reflects
higher residential garbage and recycling charges. Miscellaneous Revenues are projected higher
due to a trend of increased donations.
The property tax levy generates 87% of the General Fund revenues. Other than franchise fees,
the city does not impose other taxes, such as local option sales taxes or income taxes.
Therefore, the city will remain dependent on property tax revenue as its major source of future
revenues.
Classification 2023 2024 % Change
Property Taxes 8,060,000$ $8,640,000 7.2%
Franchise & Other Taxes 316,500 346,500 9.5%
Licenses & Permits 484,000 487,000 0.6%
Intergovernmental Revenues 513,895 1,057,000 105.7%
Charges for Services 1,246,779 1,309,743 5.1%
Fines & Forfeits 51,600 51,600 0.0%
Special Assessments 100 100 0.0%
Miscellaneous 807,126 865,057 7.2%
Total 11,480,000$ 12,757,000$ 11.1%
General Fund Revenues and Other Sources
67.7%2.7%
3.8%
8.3%
10.3%
0.4%6.8%
2024 Revenues -General Fund
Property Taxes
Franchise & Other Taxes
Licenses & Permits
Intergovernmental
Revenues
Charges for Services
Fines & Forfeits
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SPECIAL REVENUE FUNDS
The City of Monticello currently operates special revenue funds for cemetery and community
center activities along with the Small Cities Development Program (SCDP) Fund, which will likely
see little activity in 2024 outside of one loan to a local business.
Like the General Fund, the special revenue fund budgets are set at a level to maintain services.
The tax levy supports community center operations ($525,000). Charges for services are the
largest revenue source for both the community center (memberships) and the cemetery (plot
sales). Community center charges were budgeted with added conservatism due to the
uncertain nature of discretionary spending in the current economic environment. The city’s
American Rescue Plan Act (ARPA) funding was used in the community center fund in 2021-
2023.
The following tables display the change in budgeted revenues and other sources and the
change in budgeted expenditures and other uses for special revenue funds:
DEBT SERVICE FUND (Aggregate of Sub-Funds)
The city's debt service for 2024 is $2,603,000, or $2,800 (0.1%) less than the prior year due to
routine amortization of outstanding bond issues. Funding for debt service comes from special
assessments and property taxes. Outstanding debt as of January 1, 2024: debt service funds -
$16,635,000; Sewer enterprise fund - $2,498,000; Central Equipment internal service fund -
$60,000. The city's bond rating from Moody’s Investors Services is "Aa3."
CAPITAL PROJECT FUNDS
The budgets for capital project funds are based on the 2024 project expenditures listed in the
city's five-year capital improvement plan. The city's five-year capital improvement plan is
included in a later section of this report. $30,000,000 in one debt issuance is planned for 2024,
which will be used to fund the construction of a new Public Works Facility.
Classification 2023 2024 % Change
Property Taxes 515,000$ 525,000$ 1.9%
Tax Increments - - ---
Intergovernmental Revenues 400,000 - -100.0%
Charges for Services 1,228,300 1,441,100 17.3%
Miscellaneous 28,700 41,900 46.0%
Operating Transfers In - 100,000 -
Total 2,172,000$ 2,108,000$ -2.9%
Special Revenue Funds Revenues and Other Sources
Department 2023 2024 % Change
Personnel Services 1,185,518$ 1,313,235$ 10.8%
Supplies 118,800 107,000 -9.9%
Other Services & Charges 721,682 668,765 -7.3%
Capital Outlay 127,000 - -100.0%
Operating Transfers Out - - ---
Total 2,153,000$ 2,089,000$ -3.0%
Special Revenue Funds Appropriations
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ENTERPRISE FUNDS
Total revenues and other sources for the enterprise funds (Water, Sewer, Stormwater, Liquor,
DMV, and Fiber Optics) is estimated at $17,515,000 for 2024. The change in Sale of Goods
represents a conservative budgeting policy. Charges for services increases with higher rates
charged on enterprise fund customers. Special assessments stay the same to remain
conservative.
Personnel services increase with wage and benefit inflation of 4.0% and a step increase for
staff, where applicable. Operating transfers out are from the Liquor Store to fund the
Downtown Pedestrian & Roadways Improvements project and from the Deputy Registrar Fund
to support operations in the Community Center special revenue fund.
INTERNAL SERVICE FUNDS
The City of Monticello operates four internal service funds: Facilities Maintenance, Information
Technologies (IT) Services, Central Equipment Fund, and Benefits Accrual. These funds operate
on a cost-recovery basis, but the time horizon differs greatly. Internal service fund charges are
recorded as expenditures in other funds.
The Facilities Maintenance and IT Services funds are not capital intensive with annual small
tools and equipment purchases in the $20,000 to $30,000 range. IT equipment usually has a
shorter replacement cycle. The Facilities Maintenance Fund focuses on proactive monitoring
and repairs & maintenance of existing city buildings. Major capital improvements or
replacements are funded through the appropriate capital projects fund or enterprise fund.
The Central Equipment Fund is funded through annual rental charges to benefitting budget
units to recover equipment purchase costs over 7–10-year periods. Annual depreciation and
inflation for each capital asset are used in calculating annual rental payments.
Classification 2023 2024 % Change
Sale of Goods 7,357,694$ 7,504,849$ 2.0%
Licenses & Permits 2,000 2,000 0.0%
Intergovernmental Revenues 300,000 1,330,000 ---
Charges for Services 8,071,101 8,458,899 4.8%
Special Assessments 10,000 10,000 0.0%
Miscellaneous 146,205 134,252 -8.2%
Contributed Capital 75,000 75,000 0.0%
Total 15,962,000$ 17,515,000$ 9.7%
Enterprise Funds Revenues and Other Sources
Department 2023 2024 % Change
Personnel Services 2,503,619$ 2,556,843$ 2.1%
Supplies 6,027,117 6,133,540 1.8%
Other Services & Charges 4,975,273 4,651,094 -6.5%
Capital Outlay 2,535,000 4,175,000 64.7%
Debt Service 367,991 367,523 -0.1%
Operating Transfers Out 4,000,000 1,100,000 -72.5%
Total 20,409,000$ 18,984,000$ -7.0%
Enterprise Funds Appropriations
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The Benefits Accrual Fund accumulates resources from governmental funds to match the city’s
paid leave (paid-time-off) liability for governmental fund employees.
DISCRETELY PRESENTED COMPONENT UNIT FUND
The city currently has one discretely presented component unit fund. Component units are
legally separate entities for which the city (primary government) is financially accountable, or
for which the exclusion of the component unit would render the financial statements of the
primary government misleading. The Monticello Economic Development Authority (EDA) is a
legally separate entity created pursuant to Minnesota Statutes § 469.090 through § 469.108 to
carryout economic and industrial development and redevelopment within the city in
accordance with policies established by the City Council. Under Section 469.033, subd. 6, of the
HRA Act, the HRA’s special benefit tax is levied annually and is limited to 0.0185% of the taxable
market value, which is $451,000 in 2024. Tax increments support economic development
activities, but their use is generally restricted to a specific activity in a specific area.
FUND BALANCES
Fund balances decline when expenditures exceed revenues. The General Fund and Monticello
Community Center (MCC) Fund generally have balanced budgets where revenues equal
expenditures. The Economic Development Authority (EDA)’s fund balance is projected to
decrease with the return in 2024 of excess increment in a TIF district decertified in 2023. The
fund balance in the Debt Service Fund declines through normal debt amortization. Additionally,
the fund balance for the capital projects funds declines with anticipated use of existing
resources for various projects. Enterprise fund balances decline by roughly $1,469,000, largely
the result of a Liquor Fund transfers to the Capital Projects Fund.
CHALLENGES IN CONTEXT
The preparation of this budget reflects the need to meet both short-term and long-term
challenges. While the local economy is stable, inflation has been extremely high and levels of
unemployment in upcoming months and years are uncertain. The commercial and residential
tax base grew significantly in 2024, and while the Monticello Nuclear Generating Plant still
represents a significant portion of the tax base, it decreased in value. Ultimately, the City
Council desires to meet current and future growth needs by maintaining a low tax capacity rate.
Second, in 2021, the city paid off the judgment bonds related to the 2014 settlement of the
telecommunication bondholder’s class-action lawsuit, which further allows the city to put the
bond default behind it. The city renewed its contract with Arvig Enterprises through June of
2026. Since 2019, Fibernet has had positive cash flow from operations and is situated to cover
the majority, if not all, of the capital investment into new neighborhoods in the coming years.
Third, the city is moving ahead with several capital projects. Most large projects have
reimbursement resolutions, meaning the city can recover their temporary draw on reserves
with debt proceeds. Major Council initiatives in the next few years include improvements to
downtown with a focus near Block 52, a new public works facility, a new water treatment
facility, the Pointes at Cedar development area, and additional phases for improvements at the
Bertram Chain of Lakes (BCOL) Regional Park. A Local Option Sales Tax will be on the ballot for
28Table of Contents
voters to decide how the Pointes at Cedar and BCOL projects will be funded, which in turn
determines how quickly the projects can progress. Other large projects further on the horizon
include safety and utility improvements on Fallon Avenue.
Fourth, stable leadership requires long term planning, but council seats are not as long as
planning efforts require. In 2022, the mayor was re-elected for a second two-year term, one
existing councilmember was re-elected for an additional four-year term, and two new
councilmembers began their terms; one was elected to a vacant four-year term and the other
was appointed to fill the remaining two years of a vacated four-year term. The mayor and two
councilmembers have terms expiring at the end of 2024. While policy perspectives still exist,
the mayor and council are looking at ways to meet future challenges through increased public
participation.
In summary, the uncertain economic environment, public safety service enhancement,
transportation improvements, stabilization in Fibernet operations, and economic and park
development impacted the decisions made in drafting the 2024 budget.
DISTINGUISHED BUDGET PRESENTATION AWARD
The Government Finance Officers Association of the United States and Canada (GFOA)
presented a Distinguished Budget Presentation Award to the City of Monticello, Minnesota for
its annual budget for the fiscal year beginning January 1, 2023. To receive this award, a
governmental unit must publish a budget document that meets program criteria as a policy
document, as an operations guide, as a financial plan, and as a communications device.
This award is valid for a period of one year only. We believe our current budget continues to
conform to program requirements, and we are submitting it to GFOA to determine its eligibility
for another award.
CONCLUSION
Conservation of city financial resources continues to be a very important objective. The budget
is the prime tool in making sure limited resources are wisely utilized. It is the city’s belief that
the 2024 budget allows the city to deliver excellent municipal services in a cost effective and
efficient manner. The 2024 budget is a product of collective efforts by the City Council, staff,
and various other stakeholders. Their commitment, good judgment, and expertise are
invaluable to the budget process.
Sincerely,
Sarah Rathlisberger
Finance Director
March 6, 2024
29Table of Contents
ORGANIZATION CHART
The City of Monticello operates a city administrator form of government, whereby the city
administrator acts as the liaison between city staff and the city council. The city administrator
leads council workshops and discussions to form strategic plans and goals. The strategic plans
and goals are then used as the starting point for city leaders to submit budget requests for the
upcoming year.
During internal budget discussions, staff look to the city administrator to ensure the budget is
aligning with council’s desired outcomes. City leaders are then responsible for how their
departments’ budgets translate from the council’s strategic plans and goals to daily workload.
Residents
City Council
City Administrator
Human Resources Manager
Communications & Marketing Specialist
Finance Director
Finance
& Audit
Deputy Registrar
Liquor Operations
Information Technology
Community Development Director
Economic Development
Building Inspections
Consulting Planner
CIty Engineer
Project Engineer
Construction Inspections
Consulting Engineer
Public Works Director
Streets Department
Water & Sewer Department
Refuse Collection
Parks, Art & Recreation Director
Community Center
Parks Department
MontiArts
City Clerk
Elections
Reception
Fire Chief
Fire Department
Contracted Services
City Attorney
Sheriffs Department
County Assessor
FiberNet Operation
Animal Control
Commissions
& Boards
30Table of Contents
FUND DESCRIPTIONS & STRUCTURE
BUDGETED FUNDS
The city has legally adopted budgets for the General Fund and all special revenue funds.
Expenditures may not legally exceed budgeted appropriations at the total fund level. Monitoring
of budgets is maintained at the department level. Any amounts over budget would need to be
approved by the city council through the disbursement process. Although the city is not legally
required to adopt an annual budget for the nonmajor special revenue funds, the debt service
funds, capital projects funds, enterprise funds, and internal service funds, it does so as a means
of implementing an entity-wide view of the city’s finances, all of which are included in the city’s
Annual Comprehensive Financial Report (ACFR) and Long-Term Financial Plan, which is updated
annually.
Budgets are adopted on a basis consistent with accounting principles generally accepted in the
United States of America. Budgeted amounts are as originally adopted or amended by the city
council. All annual appropriations lapse at year-end.
MAJOR FUNDS
A fund is considered major if its revenues or expenditures, excluding other financing sources and
uses, constitute more than 10% of the revenues or expenditures of the appropriated budget.
Major funds are bolded with red font in the hierarchy on the following pages and do not
necessarily match the major funds presented in the city’s ACFR because the calculation for
purposes of the ACFR differ slightly and are based on actual rather than budgeted revenues and
expenditures.
General Fund - The General Fund is used to account for all financial resources except those
required to be accounted for in another fund.
Capital Project - The Capital Project (capital projects) Fund is used to account for all capital
acquisition and construction activities of the city not accounted for in another capital project,
enterprise, or internal service fund.
Liquor - The Liquor (enterprise) Fund is used to account for the operations of the city’s liquor
store.
Details on the purposes of the nonmajor funds are included with each fund later in this report.
31Table of Contents
GovernmentalGeneral
Special Revenue
Economic Development Authority
Fund
Cemetery Fund
Small Cities Development Program
(SCDP) Fund
Community Center Fund
Debt Service
2015B GO Bond Sub-Fund
2016A GO Bond Sub-Fund
2017A GO Bond Sub-Fund
2018A GO Bond Sub-Fund
2019A GO Bond Sub-Fund
2020A GO Bond Sub-Fund
Capital Projects
Capital Project Fund
Street Lighting Improvement Fund
Park & Pathway Improvement Fund
Park Dedication Fund
32Table of Contents
ProprietaryEnterprise
Water Fund
Sewer Fund
Stormwater Fund
Liquor Fund
Deputy Registrar Fund
Fiber Optics Fund
Internal Service
Facilities Maintenance Fund
IT Services Fund
Central Equipment Fund
Benefit Accrual Fund
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DEPARTMENTS & FUNDS RELATIONSHIP
The departments within each fund’s budget are noted in the matrix below:
All capital project funds, except the Parks & Pathway Improvement Fund, were combined for
this presentation. Principal and interest payments on debt occur in the Debt Service Fund
(comprised of subfunds), Sewer Fund, and Central Equipment Fund.
Community Capital Park &Water, Sewer Liquor Deputy Fiber Facilities IT Central Benefit
General Cemetery Center Projects Pathway & Stormwater Store Registrar Optics Maintenance Services Equipment Accrual EDA
GENERAL GOVERNMENT
Mayor & Council ●
City Administration ●●●●
City Clerk ●●●
Finance, Audit & Assessing ●●●●●●●●
Legal ●
Human Resources ●●●
Planning & Zoning ●●●●●
City Hall ●●
Economic Development ●●●
PUBLIC SAFETY
Law Enforcement ●
Fire & Rescue ●●●●●
Fire Relief ●
Building Inspections ●●●
Emergency Management ●●●
Animal Control ●●●
National Guard ●
PUBLIC WORKS
PW Administration ●●●●
Engineering & Inspections ●●●●●
Streets & Alleys ●●●●●●
Ice & Snow ●●
Shop & Garage ●●●●●
Street Lighting ●●●
Refuse Collection ●
Water Utility ●● ●
Sewer Utility ●● ●
Stormwater Utility ●●
RECREATION AND CULTURE
Senior Center ●●
Park Operations ●●●●●
Park Improvements ●●
Park Ballfields ●
Public Arts ●●
Shade Tree ●
Library ●●
Cemetery ●●
Community Center ●● ●
Fiber Optics ●●●
FUND
34Table of Contents
BASIS OF BUDGETING
The City of Monticello budget serves several purposes:
•For the residents, it presents a picture of the city government operations and
intentions for the year.
•For the city council, it serves as a policy tool and as an expression of goals and
objectives.
•For city management, it is used as an operating guide and a control mechanism.
The city's budget encompasses both the operating budget and the capital improvement
budget. Each budget unit includes amounts appropriated for both operating expenditures and
capital acquisitions and improvements. Accompanying narrative for each budget unit briefly
explains the items included.
BASIS OF BUDGETING
The city’s accounts are categorized by funds, each of which is accounted for as an individual
entity. The operations of each fund are accounted for with a separate set of self-balancing
accounts that comprise its assets, deferred inflow/outflows, liabilities, fund equity, revenues,
and expenditures.
Governmental funds (the General Fund, special revenue, debt service, and capital project
funds) use the modified accrual basis for budgeting and accounting. Revenues are
recognized in the accounting period in which they become measurable and available.
Expenditures are recognized when liabilities are incurred.
Proprietary funds (enterprise and internal service funds) use the modified accrual basis for
budgeting and the full accrual basis for accounting for financial reporting. In the full accrual
basis of accounting, revenues are recognized in the accounting period in which they are
earned, and expenses are recognized in the accounting period in which they are incurred,
regardless of when the actual cash flow occurs. For example, the full accrual basis accounting
differs from the modified accrual basis by recording expenses for depreciation and
compensated absences but not debt principal payments, whereas the modified accrual basis
of accounting would classify the original capital cost as an expenditure (and would therefore
have nothing to depreciate), the compensated absence payment as an expenditure at the
time of payment rather than when earned, and debt proceeds as revenue when received and
expenditures when repaid. Each proprietary fund’s financial statements, located in the city’s
Annual Comprehensive Financial Report (ACFR), are reported on the full accrual basis.
WORKLOAD/PERFORMANCE BUDGETING
The City of Monticello strives to develop a budget focused on workload/performance outputs
rather than incrementally budget based on the prior year. This type of budgeting shifts the
emphasis away from describing what will be purchased (inputs) towards describing what will
be accomplished (outputs and outcomes). While this budgeting process faces numerous
structural and cultural hurdles, this work-in-progress continues today with both an
organization-wide and budget-unit specific focus on outcomes.
35Table of Contents
FINANCIAL POLICIES
The overall goal of the city's financial policies is to establish and maintain effective
management of the city's financial resources. Formal policy statements and major objectives
provide the foundation for achieving this goal. Accordingly, this section outlines the policies
used in guiding the preparation and management of the city's overall budget and the major
objectives to be accomplished. In addition, the rationale which led to the establishment of the
fiscal policy statements is also identified.
Budget Development & Administration Practices
1.A comprehensive annual budget will be prepared for all funds expended by the city.
The City Council shall have full authority over the financial affairs of the city and shall
provide for the collection of all revenue and other assets, the auditing and settlement of
accounts, the safekeeping and disbursement of public monies, and, in the exercise of a sound
discretion, shall make appropriations for the payment of all liabilities and expenses. Inclusion of
all funds in the budget enables the council, administration, and the public to consider all
financial aspects of city government when preparing, modifying, and monitoring the budget,
rather than deal with the city's finances on a "piece meal" basis.
2.The budget will be prepared in such a manner as to facilitate its understanding by
residents and elected officials.
One of the stated purposes of the budget is to present a picture of city government
operations and intentions for the year to the residents of Monticello. Presenting a budget
document that is understandable to the residents furthers the goal of effectively
communicating local government finance issues to both elected officials and the public.
3.Budgetary emphasis will focus on providing those basic municipal services that provide
the maximum level of services, to the most residents, in the most cost-effective manner, with
consideration being given to all costs - economic, fiscal, and social.
Adherence to this basic philosophy provides the residents of Monticello assurance that
their government and elected officials are responsive to the basic needs of the residents and
that their city government is operated in an economical and efficient manner.
4.The budget will provide for adequate maintenance of capital, plant, and equipment and
for their orderly replacement.
All governmental entities experience prosperous times as well as periods of economic
decline. In periods of economic decline, proper maintenance and replacement of capital, plant,
and equipment is generally postponed or eliminated as a first means of balancing the budget.
Recognition of the need for adequate maintenance and replacement of capital, plant, and
equipment, regardless of the economic conditions, will assist in maintaining the government's
equipment and infrastructure in good operating condition.
5.The city will avoid budgetary practices that balance current expenditures at the expense
of meeting future year expenditures.
36Table of Contents
Budgetary practices such as postponing capital expenditures, accruing future years'
revenues, or rolling over short-term debt are budgetary practices which can solve short-term
financial problems. However, they can create much larger financial problems for future
administrations and councils. Avoidance of these budgetary practices will assure residents that
current problems are not simply being delayed to a future year.
6. The city will give highest priority in the use of one-time revenues to the funding of capital
assets or other non-recurring expenditures.
Utilizing one-time revenues to fund on-going expenditures results in incurring annual
expenditure obligations, which may be unfunded in future years. Using one-time revenues to
fund capital assets or other non-recurring expenditures better enables future administrations
and councils to cope with the financial problems when these revenue sources are discontinued,
since these types of expenditures can more easily be eliminated.
7. The city will maintain a budgetary control system to help it adhere to the established
budget.
The budget passed by the council establishes the legal spending limits for the city. A
budgetary control system is essential to ensure legal compliance with the city's budget.
8. The city will exercise budgetary control (maximum spending authority) through City
Council approval of appropriation authority for each appropriated budget unit.
Exercising budgetary control for each appropriated budget unit satisfies requirements of
state law. It also assists the council in monitoring current year operations and acts as an early
warning mechanism when departments deviate in any substantive way from the original
budget.
9. Reports comparing actual revenues and expenditures to budgeted amounts will be
prepared monthly as practical and formally reported to City Council quarterly.
The city's budget is ineffective without a system to regularly monitor actual spending
and revenue collections with those anticipated at the beginning of the year. Monthly and
quarterly reports comparing actual revenues and expenditures to budget amounts provide the
mechanism for the council and administration to regularly monitor compliance with the
adopted budget.
10. State Requirement: Truth-in-Taxation
The Truth in Taxation (TNT) law requires the city to hold a series of public hearings to
present the proposed levy and budget, and to provide an opportunity for the public to
comment and make recommendations. The city’s proposed general levy and the EDA
(economic development authority)’s proposed HRA (housing and redevelopment authority) levy
must be certified to the county auditor by September 30th. The final levies for both must be
certified by December 29th.
37Table of Contents
Revenue Collection Practices
1. The city will seek to maintain a diversified and stable revenue base.
A city dependent upon a few volatile revenue sources is frequently forced to suddenly
adjust tax rates or alter expenditure levels to coincide with revenue collections. Establishment
of a diversified and stable revenue base, however, serves to protect the city from short-term
fluctuations in any one major revenue source.
2. The city will estimate revenues in a realistic and conservative manner.
Aggressive revenue estimates significantly increase the chances of budgetary shortfalls
occurring during the year--resulting in either deficit spending or required spending reductions.
Realistic and conservative revenue estimates, on the other hand, will serve to minimize the
adverse impact of revenue shortfalls and will also reduce the need for mid-year spending
reductions.
3. The city will pursue an aggressive policy of collecting revenues.
An aggressive policy of collecting revenues will help to ensure the city's revenue
estimates are met, all taxpayers are treated fairly and consistently, and delinquencies are kept
to a minimum.
4. The city will aggressively pursue opportunities for federal or state grant funding.
An aggressive policy of pursuing opportunities for federal or state grant funding
provides residents assurance that the city is striving to obtain all state and federal funds to
which it is eligible--thereby reducing dependence upon local taxpayers for the support of local
public services.
5. User fees and charges will be used, as opposed to general taxes, when distinct beneficiary
populations or interest groups can be identified.
User fees and charges are preferable to general taxes because user charges can provide
clear demand signals which assist in determining what services to offer, their quantity, and
their quality. User charges are also more equitable, since only those who use the service must
pay--thereby eliminating the subsidy provided by nonusers to users, which is inherent in
general tax financing.
6. User fees will be collected only if it is cost-effective and administratively feasible to do so.
User fees are often costly to administer. Prior to establishing user fees, the costs to
establish and administer the fees will be considered to provide assurance that the city's
collection mechanisms are being operated in an efficient manner.
Expenditures and Payments Practices
1. Ongoing expenditures will be limited to levels which can be supported by ongoing
revenues.
Utilization of reserves to fund on-going expenditures will produce a balanced budget,
however, this practice will eventually cause severe financial problems. Once reserve levels are
38Table of Contents
depleted, the city would face elimination of on-going costs to balance the budget. Therefore,
the funding of on-going expenditures will be limited to current revenues.
2.Minor capital projects or recurring capital projects, which primarily benefit current
residents, will be financed from current revenues.
Minor capital projects or recurring capital projects represent relatively small costs of an
on-going nature, and therefore, should be financed with current revenues rather than utilizing
debt financing. Those who benefit from a capital project should pay for the project.
4.Major capital projects, which benefit future residents, will be financed with other
financing sources (e.g., debt financing) as appropriate.
Major capital projects represent large expenditures of a non-recurring nature which
primarily benefit future residents. Debt financing provides a means of generating sufficient
funds to pay for the costs of major projects. Debt financing also enables the costs of the project
to be supported by those who benefit from the project, since debt service payments will be
funded through charges to future residents.
5.Construction projects and capital expenditures of $10,000 or more will be included in the
Capital Improvement Plan (CIP) and related capital outlay line item; minor capital outlays
(less than $10,000) will be included in the operating budget as small tools & equipment or
repairs & maintenance.
The Capital Improvement Plan (CIP) differentiates the financing of high-cost, long-lived
physical improvements from low cost "consumable" equipment items contained in the
operating budget. CIP items may be funded through debt financing, a planned buildup of
reserves, or current revenues while operating budget items are annual or routine in nature and
should only be financed from current revenues.
6.Spending Policy: The city will spend its resources in the following order. Resources will be
categorized according to Generally Accepted Accounting Principles (GAAP) for state and local
governments, with the following general definitions:
•Restricted: Amounts constrained to specific purposes by their providers (such as
grantors, bondholders, and higher levels of government) through constitutional
provisions or by enabling legislation.
•Committed: Amounts constrained to specific purposes by the City Council by Resolution;
to be reported as committed, amounts cannot be used for any other purpose unless the
City Council takes action to remove or change the constraint also by Resolution.
•Assigned: Amounts the city intends to use for a specific purpose; intent can be
expressed by the council or by a designee to which the council delegates the authority.
The City Council delegated this authority to itself, City Administrator, or Finance
Director.
•Unassigned: Amounts that are available for any purpose; these amounts are reported
only in the General Fund.
When both restricted and unrestricted resources are available, spending will occur in the
following order: Restricted, Committed, Assigned, Unassigned.
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Capital Assets Policy – Adopted July 28, 2008
1.The city will be categorized by classes of capital assets.
The classes of capital assets will be land, parking lots, buildings, infrastructure,
improvements (other than buildings), machinery and equipment, office equipment and
furniture, and motor vehicles. Construction in Progress will be recognized as an asset but is not
eligible to be depreciated until the project is completed and/or asset is transferred to the city.
2.The city will capitalize items by classification as summarized in the Capitalization
Thresholds & Useful Lives in the Appendix of this document.
3.Donations of capital assets will be recorded at estimated fair market value at the date of
acquisition.
4. Straight-line depreciation will be the method used per the useful lives summarized in the
Capitalization Thresholds & Useful Lives in the Appendix of this document.
Land, easements and construction in progress are not considered depreciable assets.
5. The finance department will distribute an inventory list, by department, to each
department head annually during the fall of each year.
It will be the department head’s responsibility to verify the inventory form, accounting
for any changes in their department’s inventory, and return it to the finance department. The
finance department will then make any necessary adjustments, transfers, or disposals to the
capital assets system, to account for these changes.
6.A physical inventory of the City’s capital assets will be conducted at least every four years
by the finance department staff in conjunction with the various departments.
Random inventories may be conducted by staff at any time also. The appropriate
adjustments will be made to the capital asset system. Any significant variances will be
investigated, and policies and procedures will be adjusted accordingly, if necessary.
Debt Administration Practices
1.The city will limit long-term debt to capital improvements which cannot be financed from
current revenues.
Incurring long-term debt serves to obligate future taxpayers. Excess reliance on long-
term debt can cause debt levels to reach or exceed the government's ability to pay. Therefore,
conscientious use of long-term debt will provide assurance that future residents will be able to
service the debt obligations left by former residents.
2.The city will repay borrowed funds within a period not to exceed the expected useful life
of the asset.
This policy reflects the view that those residents who benefit from a project should pay
for the project. Adherence to this policy will also help prevent the government from over-
extending itself regarding the incurrence of future debt.
3.The city will not use long-term debt for financing current operations.
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This policy reflects the view that those residents who benefit from a service should pay
for the service. Utilization of long-term debt to support current operations would result in
future residents supporting services provided to current residents.
4.The city will adhere to a policy of full public disclosure regarding the issuance of debt.
Full public disclosure regarding the issuance of debt provides assurance that the
incurrence of debt, for which the public is responsible, is based upon a genuine need and is
consistent with underwriter guidelines.
Reserves and Fund Balances Policy – Adopted September 12, 2011
1.Reserves and Fund Balances will be properly designated into the following categories:
•Nonspendable fund balance: Amounts that are not in a spendable form (such as
inventory) or are required to be maintained intact (such as the principal of an
endowment fund).
•Restricted fund balance: Amounts constrained to specific purposes by their providers
(such as grantors, bondholders, and higher levels of government) through constitutional
provisions or by enabling legislation.
•Committed fund balance: Amounts constrained to specific purposes by the City Council
by Resolution; to be reported as committed, amounts cannot be used for any other
purpose unless the City Council takes action to remove or change the constraint also by
Resolution.
•Assigned fund balance: Amounts the city intends to use for a specific purpose. The City
Council, City Administrator, or Finance Director can express intent.
•Unassigned fund balance: Amounts that are available for any purpose; these amounts
are reported only in the General Fund or a deficit in other fund types.
2.A minimum level of general fund reserve of 60-75% of annual operating expenditures will
be maintained. This reserve is committed to be used for cash flow purposes, unanticipated
equipment acquisition and replacement, and to otherwise enable the city to meet
unexpected expenditure demands (natural disasters, catastrophic events, etc.) or revenue
shortfalls.
Property taxes represent the city's primary source of general fund revenue. Property
taxes are collected in June and December of each fiscal year. Since the city's fiscal year begins
on January 1st, the city must maintain an adequate cash balance to meet its expenditure
obligations between semi-annual collections of property taxes.
Accrued employee payroll benefits, such as sick leave, vacation, or paid time off,
represent a significant obligation of the city. The city will maintain sufficient reserves to meet
its annual expenditure obligations in the Benefit Accrual internal service fund.
The city recognizes the need to maintain adequate equipment to carry out required
public services. Equipment acquisition and replacement represent on-going costs of a minor
nature, as compared to major capital purchases. The city plans for equipment replacement
within the Capital Improvement Plan. However, unforeseen equipment problems will arise. The
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reserve will provide resources for the immediate, unanticipated replacement of critical
equipment.
The city is subject to revenue shortfalls and unexpected expenditure demands during the
fiscal year. An unassigned general fund reserve will be maintained to be able to offset these
revenue shortfalls or meet unexpected demands occurring during the year, without suddenly
adjusting tax rates or reducing expenditures.
Financial Reporting & Accounting Practices
1.The city will manage and account for its financial activity in accordance with Generally
Accepted Accounting Principles (GAAP) as set forth by the Governmental Accounting
Standards Board (GASB).
GASB is recognized as the authority with respect to governmental accounting. Managing
the city's finances in accordance with GAAP and in accordance with the rules set forth by GASB
provides the Monticello residents assurance that their public funds are being accounted for in a
proper manner.
2.The city will maintain its accounting records for general governmental operations on a
modified accrual basis, with revenues recorded when available and measurable, and
expenditures recorded when services or goods are received, and liabilities incurred.
Accounting records for proprietary fund types and similar trust funds will be maintained on
an accrual basis, with all revenues recorded when earned and expenses recorded when
liabilities are incurred, without regard to timing of cash receipt or payment.
Adherence to this policy will allow the city to prepare its financial statements in
accordance with Generally Accepted Accounting Principles as set by the Governmental
Accounting Standards Board.
3.The city of Monticello will prepare an Annual Comprehensive Financial Report (ACFR) in
conformity with Generally Accepted Accounting Principles (GAAP). The report will be made
available to the public. The ACFR shall be prepared in accordance with the standards
established by the GFOA for the Certificate of Achievement for Excellence in Financial
Reporting Program.
The Certificate of Achievement represents a significant accomplishment for a
government and its financial leadership. The program encourages governments to prepare and
publish an easily readable and understandable comprehensive annual financial report covering
all funds and financial transactions of the government during the year. The ACFR provides users
with a wide variety of information useful in evaluating the financial condition of a government.
The program also encourages continued improvement in the city's financial reporting practices.
4.The city will ensure the conduct of timely, effective, and annual audit coverage of all
financial records in compliance with Local, State, and Federal laws.
Audits of the city's financial records provide the public assurance that its funds are being
expended in accordance with Local, State, and Federal laws and in accordance with Generally
Accepted Accounting Principles. Audits also provide management and the City Council with
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suggestions for improvement in its financial operations from independent experts in the
accounting field.
5.The city of Monticello will maintain a policy of full and open public disclosure of all
financial activity.
Full and open public disclosure of all financial activity provides the public with assurance
that its elected officials and administrators communicate fully all financial matters affecting the
public.
6.The modified accrual basis of accounting and budgeting is used for the governmental
funds.
Under the modified accrual basis of accounting, revenues are recorded when
susceptible to accrual, i.e., both measurable and available. Available means collectible within
the current period or soon enough thereafter to be used to pay liabilities of the current period.
Expenditures are recorded when the related liability is incurred. Employee compensated
absences and principal and interest on long-term debt expenditures are recorded when due in
the current period.
7.The full accrual basis of accounting is used for Proprietary Funds for financial reporting
purposes.
Under this method, revenues are recorded when earned and expenses are recorded
when the related liability is incurred. For budget preparation and presentation, the proprietary
funds’ expenses are converted to expenditures and follow the same budget format as the
governmental fund types. Capital outlays in the enterprise funds are presented as expenditures
for budget basis but are recorded as assets along with associated depreciation expense on the
GAAP basis. Debt service principal payments in the enterprise funds are accounted for as
expenditures for budget purposes but are reported as reduction of long-term debt liability on
the GAAP basis. Recording capital outlays and principal payments on long-term debt as
expenditures for budget purposes, presents a clearer picture of the city’s financial operations, is
easier to administer for cash flow purposes, and is easier for the lay person to understand.
Cash Management & Investment Policy – Adopted October 23, 2017
SCOPE
This policy applies to all activities with regards to managing and investing the financial assets of
the City of Monticello. This policy pertains to the financial assets of all funds including the
General Fund, special revenue funds, capital project funds, debt service funds, enterprise funds,
and internal service funds. The covered funds are defined in the city’s Annual Comprehensive
Financial Report.
Except for cash in certain restricted funds, the City of Monticello consolidates all cash balances
from all funds into one central set of accounts. Each fund’s participation in this cash pool is
denoted by its equity-in-pooled-cash account. Investment income is allocated to the various
funds based upon the average monthly balance of each fund’s account. Use of this pooling-of-
funds method of accounting allows the city of Monticello to manage its cash more efficiently
and to maximize its investment earnings.
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OBJECTIVES
The primary objectives, in priority order, of city of Monticello’s investment activities shall be
safety, liquidity, and yield:
a.Safety
Safety of principal is the foremost objective of the investment program. Investments shall be
undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio.
The objective will be to mitigate credit risk and interest rate risk.
1.Credit Risk The city will minimize credit risk by
•Limiting investments to the safest types of securities;
•Pre-qualifying the financial institutions, brokers/dealers, intermediaries, and advisers
with which the city of Monticello will do business; and
•Diversifying the investment portfolio so that potential losses on individual securities
will be minimized.
2.Interest Rate Risk The city will minimize interest rate risk by:
•Structuring the investment portfolio so that securities invested from operating funds
mature to meet cash requirements for ongoing operations, thereby minimizing the
need to sell securities on the open market prior to maturity; and
•Investing operating funds primarily in shorter-term maturities, money market funds,
or similar investment pools.
b. Liquidity
The investment portfolio shall remain sufficiently liquid to meet all operating requirements that
may be reasonably anticipated. This will be accomplished by structuring the portfolio so that
securities mature concurrent with cash needs to meet anticipated demands (static liquidity). In
addition, since all possible cash demands cannot be anticipated, the portfolio shall consist
largely of securities with active secondary or resale markets (dynamic liquidity).
c.Yield
The City of Monticello’s investment portfolio shall be designed with the objective of attaining a
market rate of return throughout budgetary and economic cycles, commensurate with
Monticello’s investment risk constraints and the cash flow characteristics of the portfolio.
Return on investment is of least importance compared to the safety and liquidity objectives
described above. The core of investments is limited to relatively low risk securities in
anticipation of earning a fair return relative to the risk being assumed. Securities shall not be
sold prior to maturity with the following exceptions:
•a declining credit security may be sold early to minimize the loss of principal;
•a security may be sold to maximize gain, when appropriate;
•a security swap may be appropriate to improve the quality, yield, or target duration in
the portfolio; or
•a security may be sold based upon liquidity demands of the portfolio.
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AUTHORITY
Management responsibility for the investment program and for ensuring compliance with this
policy is hereby delegated to the Finance Director and is derived from Minnesota statutes and
mayor & council actions. The Finance Director shall be responsible for all transactions
undertaken and shall establish a system of procedures and internal controls for the operation
of the investment program consistent with this policy. No person may engage in an investment
transaction except as provided under the terms of this policy and the procedures established by
the Finance Director. All participants in the investment process shall seek to act responsibly as
custodians of the public trust. No officer or designee may engage in an investment transaction
except as provided under the terms of this policy and supporting procedures.
The Finance Director shall establish written statements of investment policy procedures for the
operation of the investment program consistent with this policy. Such procedures shall include
explicit delegation of authority for persons responsible for investment and cash management
transactions. The Finance Director is responsible for establishing and maintaining an internal
control structure designed to ensure that the assets of the city of Monticello are protected
from loss, theft, or misuse. The internal control structure shall be designed to provide
reasonable assurance that these objectives are met. The concept of reasonable assurance
recognizes that the cost of control should not exceed the benefits likely to be derived and that
the valuation of costs and benefits requires estimates and judgments by management.
The internal controls shall address the following points at a minimum: control of collusion,
separation of transaction authority from accounting and recordkeeping, custodial safekeeping,
avoidance of physical delivery securities, clear delegation of authority to subordinate staff
members, written confirmation of transactions for investments and wire transfers, dual
authorizations of wire transfers, staff training, and review, maintenance and monitoring of
security procedures both manual and automated.
The city may engage the services of one or more external investment managers to assist in the
management of the city’s investment portfolio in a manner consistent with the city’s objectives.
Such external managers may be granted discretion to purchase and sell investment securities in
accordance with this Investment Policy. Such managers must be registered under the
Investment Advisers Act of 1940.
ETHICS & CONFLICTS OF INTEREST
The Finance Director and other employees involved in the investment process shall refrain from
personal financial activity that could conflict with the proper execution and management of the
investment program, or which could impair their ability to make impartial investment decisions.
The Finance Director and other employees involved in the investment process shall disclose to
the mayor & council any material financial interests in financial institutions with which they
conduct business. They shall further disclose any personal financial/investment positions that
could be related to the performance of the city’s portfolio. The Finance Director and other
employees involved in the investment process shall subordinate their personal investment
transactions to those of the city of Monticello shall refrain from undertaking personal
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investment transactions with the same individual with whom business is conducted on behalf
of the city.
PRUDENCE
The general investment policies of the city of Monticello will be guided by the "prudent person"
standard. Those with investment responsibility for public funds are fiduciaries and, as such,
shall exercise the judgment and care, under circumstances then prevailing, which persons of
prudence, discretion, and intelligence exercise in the management of their own affairs, not for
speculation, but for investment, considering the probable safety of their capital as well as the
probable income to be derived.
The standard of prudence shall be applied in the context of managing the overall portfolio.
Investment officers, acting in accordance with this investment policy and exercising due
diligence, shall be relieved of personal responsibility for an individual security's credit risk or
market price changes, provided significant deviations from expectations are reported in a
timely fashion and appropriate action is taken to control adverse developments. Investment
officers acting in good faith are not personally liable for investment or deposit losses.
AUTHORIZED FINANCIAL DEALERS AND INSTITUTIONS
The Finance Director shall designate and maintain a list of financial institutions and depositories
authorized to provide investment services. In addition, a list will also be maintained of
approved security brokers/dealers that maintain an office within the State of Minnesota. These
may include "primary" dealers or regional dealers that qualify under Security and Exchange
Commission's Uniform Net Capital Rule (Rule 15C3-1). The mayor & council shall designate the
financial institution for the city’s operating account.
All financial institutions and brokers/dealers that wish to become qualified bidders for
investment transactions must supply the following:
•a copy of the latest audited financial statements demonstrating compliance with state
and federal capital adequacy guidelines
•proof of state registration,
•evidence of adequate insurance coverage,
•certification of having read, understood, and agree to comply with Monticello’s Cash
Management and Investment Policy,
•proof of National Association of Securities Dealers (NASD) or Financial Industry
Regulatory Authority (FINRA) certification (brokers/dealers only), and
•completed broker/dealer questionnaire (brokers/dealers only).
An annual review of the financial condition and registration of qualified financial institutions
and broker/dealers may be conducted by the Finance Director.
Financial institutions, which serve as depositories of city funds, shall comply with all prevailing
provisions of Minnesota statutes, and shall meet the established criteria for overall financial
strength, adequate capitalization, appropriate liquidity, and proper collateralization to
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reasonably ensure the safety and availability of such deposits. To monitor and assess the overall
financial strength of current and potential depositories, the city will utilize third-party rating
agencies.
AUTHORIZED AND SUITABLE INVESTMENTS
Authorized investments for municipalities in Minnesota are stipulated in Minnesota State
Statutes. Although the following lists of authorized and prohibited investments for the city of
Monticello is slightly more restrictive than what is allowed under state law, it is in full
compliance with Minnesota State Statutes.
The Finance Director is authorized to invest in the following:
•Demand deposits, of commercial banks, saving and loan associations, and federal savings
banks authorized to do business in the State of Minnesota and authorized as described
above, and to the extent that the deposit is fully insured by the Federal Deposit Insurance
Corporation or collateralized as required in Minnesota State Statutes.
•Time deposits and certificates of deposit of commercial banks, saving and loan
associations, and federal savings banks authorized to do business in the United States or
its territories to the extent that the investment is fully insured by the Federal Deposit
Insurance Corporation or collateralized as required in Minnesota State Statutes.
•Governmental bonds, notes, bills, mortgages, and other securities, which were direct
obligations or are guaranteed or insured issues of the United States, its agencies, its
instrumentalities, or organizations created by an act of Congress, excluding mortgage-
backed securities
•State and local government obligation as follows:
o an obligation of the State of Minnesota or any of its municipalities,
o obligation of other state and local governments that have taxing power and are rated
“A” or better by a national bond rating service.
o general obligations of the Minnesota Housing Finance Agency that are rated “A” or
better by a national bond rating service.
o general obligations of housing finance agencies of other states, provided that they
include a moral obligation of the state, and they are rated “A” or better by a national
bond rating service,
o general revenue obligation of any agency or authority of the State of Minnesota other
than those found already mentioned above that are rated “AA” or better by a national
bond rating service.
o Repurchase agreements whose underlying purchased securities consist of U.S.
government obligations, U.S. government agency obligations, or U.S. government
instrumentality (including government sponsored enterprises) obligations. Adoption
of a master repurchase agreement by the mayor & council is required before the
Finance Director is authorized to enter into a repurchase agreement.
o Banker’s Acceptances of United States Corporation or their Canadian subsidiaries that
are rated “A1” by Moody’s Investors Service and/or P1 by Standard and Poor’s
Corporation and matures in 270 days or less. Banker’s Acceptances can only be
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purchased if the yield is greater than the United States Treasury obligations or Federal
Agency issues.
o Guaranteed investment contracts if issued and guaranteed by a United States
commercial bank or a United States insurance company. The credit quality of the
issuer and guarantor shall be rated in the highest category by the major national rating
services. The contract shall provide the governmental entity a non-penalized right of
withdrawal of the investment if the credit quality of the investment is downgraded.
o Commercial Paper issued by United States corporations or their Canadian subsidiaries
that are rated “A1” by Moody’s Investors Service and/or “P1” by Standard and Poor’s
Corporation and matures in 270 days or less.
o Money market funds consisting of United States Treasury Obligations and/or Federal
Agency Issues.
PROHIBITED INVESTMENTS
The Finance Director is currently prohibited from investing in securities that are considered
highly sensitive, including the following:
•Purchases on margins or short sales.
•Derivative securities that are, in effect, a leveraged bet on future movements of interest
rates or some price index.
•Mortgage-backed securities due to their complexity and prepayment rate uncertainty.
•Reverse repurchase agreements (lending securities with an agreement to buy them back
after a stated period of time).
COLLATERALIZATION
The provisions of Minnesota State Statutes require that banks and savings and loan institutions
collateralize all deposits of public funds. The city also requires collateralization of time deposits
and repurchase agreements. Banks and savings and loan associations are authorized to use any
of the investments as specified by Minnesota State Statutes as collateral. In order to anticipate
market changes and provide a level of security for all funds, the collateralization level will be
110% of the market value of principle and accrued interest. Collateral will always be held by a
third party. A clearly marked evidence of ownership (safekeeping receipt) will be supplied to
the city and retained.
SAFEKEEPING AND CUSTODY
Pledged collateral consisting of instruments of the United States Government, U.S. government
agencies, and U. S. government sponsored enterprises will be safe kept at a Federal Reserve
Bank Branch. Other acceptable collateral that cannot be held by the Federal Reserve shall be
held by a non-affiliated, independent, third-party safekeeping institution with whom the city
has a current custodial agreement. A clearly marked evidence of ownership (safekeeping
receipt) will be supplied to the city and retained. The right of collateral substitution upon prior
notification and acceptance by the city is granted.
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All securities transactions, including collateral for repurchase agreements shall be conducted on
a delivery-versus-payment (DVP) basis to ensure that securities are deposited in the city’s
safekeeping institution prior to the release of funds.
DIVERSIFICATION
Diversification of investments reduces overall portfolio risks while attaining market average
rates of return. The city of Monticello will diversify its investments by security type, sector
(excluding U.S. Treasury securities), maturity, and institution. With the exception of U.S.
government securities, U.S. government agency securities, U.S. government sponsored
enterprise securities, certificates of deposit, collateralized bank money market accounts, and
authorized local government investment pools, no more than 25% of the city of Monticello’s
total investment portfolio will be invested in a single security type. To provide assurance that
the city will be able to continue financial operations without interruption and dependent upon
interest rates, satisfaction with services, and practicality, the city of Monticello may utilize more
than one financial institution as its depository.
MAXIMUM MATURITIES
To the extent possible, the city of Monticello will attempt to match its investments with
anticipated cash flow requirements. Unless matched to a specific cash flow, the city will not
directly invest from operating funds in securities maturing more than five (5) years from the
date of purchase. However, the city of Monticello may collateralize its repurchase agreements
using longer-dated investments not to exceed fifteen (15) years to maturity.
Reserve funds and other funds with longer-term investment horizons may be invested in
securities exceeding five (5) years if the maturity of such investments is made to coincide as
nearly as practicable with the expected use of funds. No investment shall have a maturity
exceeding twenty (20) years from the time of purchase. The intent to invest securities with
longer maturities shall be approved by the Finance Director.
Because of the inherent difficulties in accurately forecasting cash flow requirements, a portion
of the portfolio shall be continuously invested in readily available funds such as demand
accounts, local government investment pools, money market funds, or overnight repurchase
agreements to ensure that appropriate liquidity is maintained to meet ongoing obligations. The
city will not actively buy and sell investments but realizes the risk of not seeking higher market
returns for longer maturities outweighs occasional liquidity demands exceeding cash and
money market investments.
PERFORMANCE STANDARDS
The investment portfolio will be managed in accordance with the parameters specified within
this policy. The portfolio should obtain a market average rate of return during a
market/economic environment of stable interest rates. The Finance Director will establish a
series of appropriate benchmarks which portfolio performance shall be compared on a regular
basis. The benchmarks shall be reflective of the actual securities being purchased and risks
undertaken, and the benchmarks shall have a similar weighted average maturity and credit
profile as the portfolio.
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REPORTING
The Finance Director will maintain investment reports that provide a clear picture of the status
of the current investment portfolio. The report shall include a management summary that will
allow the city of Monticello to ascertain whether investment activities during the reporting
period have conformed to the investment policy. Information contained within the reports shall
include the following:
•A listing of the individual securities held at the end of the reporting period by authorized
investment category.
•Term and maturity date of all investments listed.
•Par value and current market value of all investments listed.
•Yield to maturity or worse call of portfolio investments.
•Percentage of portfolio represented by each investment category.
POLICY CONSIDERATIONS
Any investment currently held that does not meet the guidelines of this policy shall be
exempted from the requirements of this policy. At maturity or liquidation, such monies shall be
reinvested only as provided by this policy.
This Statement of Cash Management and Investment Policy was adopted by motion/resolution
of the city’s mayor & council. The Finance Director and City Administrator will review this policy
annually. Any modifications made to this policy must be approved by resolution of the mayor &
council.
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Balanced Budgets Practices
A BALANCED BUDGET is as a situation where total revenues and other financing sources is
equal to (or greater than) total expenditures and other uses. Revenues and other financing
sources increase financial resources. Expenditures and other financing uses decrease financial
resources.
A balanced budget does not dip into reserves or fund balances. However, an unbalanced
budget (deficit) is not necessarily poor fiscal management. For example, debt service funds
often accumulate resources in the year prior to expenditure, and debt-financed capital projects
frequently stretch over multiple years. The city has never used debt to finance current or
ongoing expenditures.
It is the city’s practice to adopt balanced budgets for the General Fund and the Community
Center Fund. Both funds are supported, to some extent, by property taxes.
Property Taxes 8,640,000$ Personnel Services $4,299,928
Franchise & Other Taxes 346,500 Supplies 994,649
Licenses & Permits 487,000 Other Services & Charges 6,888,923
Intergovernmental Revenues 1,057,000 Capital Outlay 567,500
Charges for Services 1,309,743 Debt Service -
Fines & Forfeits 51,600 Operating Transfers 6,000
Special Assessments 100
Miscellaneous 865,057
Total $12,757,000 Total $12,757,000
General Fund
Revenues and Other Sources Expenditures and Other Uses
B
A
L
A
N
C
E
D
Surplus
Revenues and Other Sources
GREATER than
Expenditures and Other Uses
Deficit
Revenues and Other Sources
LESS than
Expenditures and Other Uses
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Absence of a line in the above chart is due to the fund having a balanced budget (zero effect on
Fund Balance/Working Capital) for 2024. Deficits reflect planned use of fund balance or future
bond issuance to reimburse for upfront costs.
$(1,800) $(1,400) $(1,000) $(600) $(200) $200 $600 $1,000
Benefit Accrual
Central Equipment
IT Services
Facilities Maintenance
Fiber Optics
Deputy Registrar
Liquor
Stormwater
Sewer
Water
Park Dedication
Park & Pathway Improvement
Street Lighting Improvement
Capital Projects
2020A G.O. Bonds
2019A G.O. Bonds
2018A G.O. Bonds
2017A G.O. Bonds
2016A G.O. Bonds
2015B G.O. Bonds
Monticello Community Center
Small Community Development Grant
Cemetery
Economic Development Authority
General Fund
Thousands
Budgeted Change in Fund Balances/Working Capital
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THE BUDGET PROCESS
BUDGET DEVELOPMENT PROCESS
To initiate the budget process, the Finance Director distributes budget request worksheets to
all department heads and supervisors. Each department works with its related boards or
commissions to ensure the priorities of each recommending body are reflected in staff’s
requests. Department leaders will consider the council’s strategic goals (for example, invest in
people) in relation to their requests (for example, reclassifying positions to reflect job
responsibilities more accurately and to encourage professional growth of staff which increases
contributions to the city). The City Administrator, Finance Director, and Finance Manager then
meet with each department director and supervisor to review the requests made. These
meetings are focused on gaining clarity, aligning expectations, and defining how requests
support the city’s mission and goals.
Requests are categorized as personnel, notable operating expenditures, equipment, and capital
expenditures. Each category is discussed at the public budget workshops along with new or
notable changes to funding sources and projected changes to the city’s tax capacity and levy.
Significant increases or decreases from the previous budget are highlighted to focus on high-
level goals for the upcoming year. The council then asks questions and gives feedback for staff
to research and present at the next public budget workshop.
Following any adjustments to the proposed budget, a preliminary tax levy resolution is
prepared, and a public hearing is held in September. The Council may again adjust the levy
and/or budget following the public hearing, after which time, the Council adopts the final tax
levy and final budget resolutions in December.
BUDGET CALENDAR/PROCEDURES
The following budget timeline outlines the process the city followed for creation and adoption
of the 2024 budget.
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PRESENTATION
The text of the budget document customarily contains six sections of information for each
activity. Some activities also include highlights or accomplishments for the prior year and/or the
coming year.
•The first section provides a description of the activity.
•The second section describes its major objectives to be accomplished.
•The third section identifies issues/challenges the activity/division faces.
•The fourth section lists the workload/performance indicators for the division.
•The fifth section provides detailed financial information.
•The sixth section provides budget commentary.
The financial information includes expenditure information for the last two completed fiscal
years, the budgeted and draft yearend amounts for the current year (i.e. amounts will not
match the final 2023 Annual Comprehensive Financial Report), and the proposed amounts for
the budget year. Costs are segregated into six basic classifications: personnel services (wage &
benefits); supplies; other services and charges; capital outlay; debt service; and operating
transfers. Appropriation control is exercised only at the activity unit level and not at the
individual object of expenditure level.
Date Activity
May 12, 2023
1.2024-2028 capital equipment/projects (CIP) worksheets and 2024 budget
worksheets to department heads.
2.Department heads meet with various advisory boards and commissions for
input into 2024 preliminary budget and CIP.
June 2, 2023 2024-2028 CIP and 2024 budget worksheets due to finance department
June, 2023
1.Department directors and supervisors meet with city administrator and
finance staff to develop 2024 preliminary budget and CIP.
2.Finance department develops revenue estimates and 2024 preliminary
property tax levy.
July 24, 2023
Public City Council Budget Workshop #1. Workshops with city council, which
are open to the public, are held to set 2024 goals and priorities and review
draft department budgets and CIP.
August 7, 2023 Public City Council Budget Workshop #2
August 28, 2023 Public City Council Budget Workshop #3.
September 11, 2023 Public City Council Budget Workshop #4.
September 25, 2023 Council adopts 2024 preliminary city and HRA property tax levies. (2024
preliminary property tax levy certification due to Wright County auditor.)
October/November 2023 City staff refine 2024 proposed budget and final property tax levy. County
mails TNT notices.
November 27, 2023 Public City Council Budget Workshop #5.
December 11, 2023 Council adopts 2024 budget and property tax levy. (Due December 30.)
December 12, 2023 City certifies final 2024 property tax levy to Wright County auditor and files
TNT Compliance and Tax Levy forms with the MN Department of Revenue.
January 1, 2024 2024 fiscal year begins.
54Table of Contents
The narrative information is presented together with the financial detail to assist readers in
understanding the planned outcomes for each activity/division, the purpose of each budget
unit, and major changes or expenditures for the coming year.
MONITORING AND REPORTING PROCESS
As the budget year proceeds, individual departments and the finance department have dual
responsibility for monitoring the status of each budget unit. Department staff has primary
responsibility for monitoring the status of expenditures against their budget. This responsibility
includes informing the finance department of any significant departures from the plans
anticipated in the budget.
The finance department has overall responsibility for monitoring the budget-to-actual status of
all departments and funds. This is accomplished primarily through analysis of computerized
budget performance reports which compare appropriation amounts on a line-item basis with
actual expenditures throughout the year. These reports aid department staff in controlling
costs and function as an early warning system for the finance department. Department staff
may exercise their judgment in exceeding expenditures by object code, provided they do not
exceed the total amount appropriated for the budget unit.
The finance department reviews the budget reports and discusses any variances from expected
performance with the department staff. The finance department conducts in-depth budget
reviews of all expenditures and revenues in its quarterly report to the council.
Significant changes in either expenditures or revenues may require a budget revision.
Recommendations are also made by the Finance Director for any recommended corrective
actions. It is the practice of the City of Monticello not to amend the budget unless absolutely
necessary.
BUDGET AMENDMENT PROCESS
State statute provides various ways to amend the budget. This first involves a reallocation of
existing appropriations among the line items within a specific fund. The second defines a series
of scenarios where the governing body has authority to amend the budget without a hearing
for donations, land sales, and fee-based budgets. All other increases in appropriation authority
that are not specifically permitted by statute must be approved through a public process.
The Finance Director is responsible for ensuring compliance with spending limitations imposed
by the budget. Accordingly, the Finance Director submits a quarterly financial report to the City
Council after three-, six-, nine-, and twelve-month periods. The budget-to-actual reports
evaluate overall revenues and expenditures in comparison to the budgeted amounts. In cases
where it appears the original spending authority authorized will not prove sufficient, transfers
of spending authority or additional spending authority are requested together with
explanations for the requests. The public approval process for budget amendments is held if
necessary.
55Table of Contents
56Table of Contents
2024 Adopted Budget
Financial Summaries
ALL FUNDS SUMMARY BY FUND TYPE
The city adopts a balanced budget for the General Fund and the Monticello Community Center
(MCC) special revenue fund. A budget is balanced when revenues and other sources equal
expenditures and other uses. Fund balances/working capital increase with surpluses and
decrease with deficits.
Debt amortization and early redemption of issues can lead to a significant decline in fund
balance for the Debt Service Fund. Multiple debt service sub-funds are aggregated into one
debt service fund for reporting purposes. Prepaid assessments collected in prior years, included
in the Jan 1 beginning fund balance, will be used in 2024 as a way to manage the property tax
levy.
Capital Project Funds commonly accumulate resources in one budget period and expend those
resources over multiple budget periods. Expenditures of fund balance are anticipated in 2023,
including prior years’ electric franchise fees. Debt proceeds to pay for the construction of a new
public works facility are expected to be issued in 2024. There are also projects with
expenditures in 2024 that will receive intergovernmental funding in future years.
Enterprise funds budget debt service and capital acquisitions as expenditures under the
modified accural basis. While that typically contributes to a budgeted negative net change in
fund balance/working capital, the large decrease budgeted in 2024 is for the use of
accumulated funds in the Liquor Fund that will be transferred out to the Capital Projects fund
as a means to fund the completion of the Downtown Pedestrian & Roadway Improvements
project in 2024.
Special Debt Capital Internal Discretely 2024
General Revenue Service Project Enterprise Service Presented Total
Fund Funds Funds Funds Funds Funds Component Unit Budget
Fund Balance/Working Capital - Jan. 1 7,747,193$ 1,560,810$ 727,936$ 12,065,606$ 33,289,611$ 5,180,808$ 7,405,869$ 67,977,833$
Revenues and Other Sources
Property Taxes 8,640,000$ 525,000$ 2,026,175$ 1,882,825$ -$ -$ 451,000$ 13,525,000$
Tax Increments - - - - - - 258,000 258,000
Franchise & Other Taxes 346,500 - - 175,000 - - - 521,500
Sale of Goods - - - - 7,504,849 - - 7,504,849
Licenses & Permits 487,000 - - - 2,000 - - 489,000
Intergovernmental Revenues 1,057,000 - - 3,766,513 1,330,000 - - 6,153,513
Charges for Services 1,309,743 1,441,100 - - 8,458,899 1,514,494 - 12,724,236
Fines & Forfeits 51,600 - - - - - - 51,600
Special Assessments 100 - 244,579 106,419 10,000 - - 361,098
Miscellaneous 865,057 41,900 9,246 85,243 134,252 70,006 50,000 1,255,704
Contributed Capital - - - - 75,000 10,500 - 85,500
Operating Transfers In - 100,000 - 1,000,000 - - 6,000 1,106,000
Debt Proceeds - -- 30,000,000 - - - 30,000,000
Total Revenues and Other Sources 12,757,000$ 2,108,000$ 2,280,000$ 37,016,000$ 17,515,000$ 1,595,000$ 765,000$ 74,036,000$
Expenditures and Other Uses
Personnel Services 4,299,928 1,313,235 - - 2,556,843 267,681 197,158 8,634,845
Supplies 994,649 107,000 - - 6,133,540 79,365 400 7,314,954
Other Services & Charges 6,888,923 668,765 3,000 35,000 4,651,094 635,174 329,451 13,211,407
Capital Outlay 567,500 - - 43,267,000 4,175,000 316,780 268,991 48,595,271
Debt Service - - 2,603,000 - 367,523 63,000 - 3,033,523
Operating Transfers Out 6,000 - - - 1,100,000 - - 1,106,000
Total Expenditures and Other Uses 12,757,000 2,089,000 2,606,000 43,302,000 18,984,000 1,362,000 796,000 81,896,000
Net Change in
Fund Balance/Working Capital -$ 19,000$ (326,000)$ (6,286,000)$ (1,469,000)$ 233,000$ (31,000)$ (7,860,000)$
Fund Balance/Working Capital - Dec. 31 7,747,193$ 1,579,810$ 401,936$ 5,779,606$ 31,820,611$ 5,413,808$ 7,374,869$ 60,117,833$
All FUNDS SUMMARY - BY FUND TYPE
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Internal service funds provide services to other funds and typically function on a cost recovery
basis. The city has four: Facilities Maintenance Fund, IT Services Fund, Central Equipment Fund,
and Benefit Accrual Fund. Central Equipment Fund equipment purchases will exceed leaseback
revenue in 2024 due to fewer capital equipment purchases expected in 2024 than in other
years. The Benefit Accrual Fund is the only internal service fund that does not record capital
asset acquisitons.
58Table of Contents
REVENUES BY CATEGORY AND FUND TYPE
Revenues are classified under one of thirteen major categories: property taxes, tax increments,
franchise & other taxes, sale of goods, licenses & permits, intergovernmental revenues, charges
for services, fines & forfeits, special assessments, miscellaneous, contributed capital, operating
transfers in, and debt proceeds. The chart below shows the relative percentage of 2024
budgeted revenues for these major categories for all funds combined. Contributed capital,
special assessments, fines & forfeits, and tax increments are shown in the chart below as 0%;
however each category has budgeted revenues, these categories represent less than 0.5% of
budgeted revenues.
REVENUES BY TYPE, GENERAL FUND ONLY— Using those same revenue categories, the relative
percentages for the General Fund are shown below. The General Fund is comprised of a much
higher percentage of property taxes compared to other funds, levying 64% of the total city and
HRA combined tax levy.
Property Taxes
18%Tax Increments
0%
Franchise &
Other Taxes
1%Sale of Goods
10%Licenses & Permits
1%
Intergovernmental
Revenues
8%
Charges for
Services
17%Fines & Forfeits
0%
Special Assessments
0%
Miscellaneous
2%
Contributed Capital
0%
Operating
Transfers In
2%
Debt Proceeds
41%
2024 Revenues by Category -All Funds
Property Taxes
64%
Franchise &
Other Taxes
2%Licenses &
Permits
7%
Intergovernmental
Revenues
Charges for
Services
11%
Fines & Forfeits
1%
Special
Assessments
0%Miscellaneous
11%
2024 Revenues by Category -General Fund
59Table of Contents
The General Fund is the city’s primary property tax levying fund, and it accounts for 17%
of the overall budgeted revenues of the city. This is a decrease from 24% in 2023 due to a
large amount of budgeted bond proceeds in 2024.
Special revenue funds, totaling 3% of appropriations (decreased from 7% in 2023), rely
mainly on property taxes and charges for services.
The Debt Service Fund includes only non-enterprise and non-internal service fund debt.
These funds represent 3% of the city’s 2024 budgeted revenues and are supported with
property taxes and special assessments. This is a decrease from 5% in 2023.
Capital project funds total 50% (up from 26% in 2023) of budgeted revenues, which
includes financing from bond proceeds, property taxes, special assessments, operating
transfers in, franchise fees and intergovernmental revenues (grants) for capital projects
and acquisitions. A significant amount ($30 million) of bond proceeds are anticipated in
2024.
Enterprise funds consist of water, sewer, stormwater, liquor, deputy registrar (DMV), and
fiber optics funds. These funds operate on a self-supporting basis, mostly from the sale of
goods and charges for services. They are responsible for 24% of the overall revenue
appropriations, which is a decrease from 34% in 2023.
Internal Service funds consist of facilities maintenance, IT services, central equipment, and
benefits accrual. These funds are supported by staff allocation or rental charges from
other funds of the city. Appropriations are 2% of the city’s 2024 budget, which is less than
the 4% of budgeted revenues in 2023.
The discretely presented component unit (Economic Development Authority, or EDA,
Fund) was reclassified from a special revenue fund in the city’s 2022 ACFR. Revenues
consist of property taxes and tax increments, which represent 1% of the 2024 budgeted
revenues.
General
17%
Special Revenue
3%Debt Service
3%
Capital Projects
50%
Enterprise
24%
Internal Service
2%
Component Unit
1%
2024 Revenues by Fund Type
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APPROPRIATIONS BY CATEGORY AND FUND TYPE
Expenditures, often called appropriations, are classified under one of six major categories:
personnel services (wages & benefits), supplies, other services & charges (professional fees,
utilities, etc.), capital outlay, debt service, and operating transfers out (other financing uses).
The chart below shows the relative percentage of 2024 budgeted expenditures for these six
major categories for all funds, combined.
APPROPRIATIONS BY TYPE, GENERAL FUND ONLY— Using those same categories of
expenditure type, the relative percentages of budgeted expenditures for the General Fund are
shown below. As you can see, the General Fund is comprised of a much higher percentage of
personnel services costs compared to all funds. The General Fund supports very little capital
improvements and no debt service compared to all funds overall.
Personnel
Services
11%
Supplies
9%
Other Services &
Charges
16%
Capital Outlay
59%Debt Service
4%
Operating
Transfers Out
1%
2024 Appropriations by Category -All Funds
Personnel
Services
35%
Supplies
7%
Other Services &
Charges
52%
Capital Outlay
6%
2024 Appropriations by Category -General Fund
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In governmental agencies, personnel services (salaries, wages, and benefits) normally represent
the largest of these categories. However, due to the significant investment in infrastructure,
cities have a much higher percentage of the budget devoted to operating and capital costs,
including debt service, than most other governmental entities. One other factor is the city’s
contracts (other services and charges) for law enforcement, legal, and assessing services.
The General Fund (the city’s primary operating fund for general government operations)
accounts for 16% of 2024 appropriations of the city. This is a decrease from 21% in 2023.
Special revenue funds, totaling 2% of 2024 appropriations (a decrease from 7% in 2022),
include a variety of fee-supported funds including the community center and cemetery.
The Debt Service Fund includes only non-enterprise and non-internal service fund debt.
These funds represent 3% of the city’s 2024 appropriations for bond principal and interest
payments. This is a decrease from 5% in 2023.
Capital project funds total 53% (up from 27% in 2022) of appropriations, which includes
costs for street construction, street lighting and park improvements, and other
governmental capital asset acquisitions excluding internal service funds. The city has
several large projects on the horizon, including budgeted expenditures in 2024 for
completion of the Downtown Pedestrian & Roadway Improvement Project, construction
of a new Public Works facility.
Enterprise funds consist of water, sewer, stormwater, liquor, deputy registrar (DMV), and
fiber optics funds. These funds operate on a self-supporting basis and are responsible for
23% of the overall 2024 appropriations. This is down from 36% in 2023.
Internal Service funds consist of facilities maintenance, IT services, central equipment,
and benefits accrual. These funds operate to provide services to the other internal
departments of the city. Appropriations are 2% of the city’s 2023 budget, which is
decrease from 4% in 2023.
The discretely presented component unit, which is comprised of the Economic
Development Authority (EDA) activities, accounts for 1% of 2024 budgeted expenditures.
General
16%
Special Revenue
2%
Debt Service
3%
Capital Projects
53%
Enterprise
23%
Internal Service
2%
Component Unit
1%
2024 Appropriations by Fund Type
62Table of Contents
INTERFUND TRANSFERS
Operating transfers support the operations of other funds, provide for special projects, and
contribute to debt service payments. The following schedule provides the 2024 budgeted
operating transfers:
Fund No.Transfer Out Fund Amount Fund No.Transfer In Fund Amount
101 General 6,000$ 213 Economic Development Authority 6,000$
609 Liquor 1,000,000 400 Capital Projects 1,000,000
653 Deputy Registrar 100,000 226 Community Center 100,000
Total Transfers Out 1,106,000$ Total Transfers In 1,106,000$
SCHEDULE OF BUDGETED OPERATING TRANSFERS IN 2024
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ALL FUNDS SUMMARY BY YEAR
Property taxes increase with a higher levy set by the City Council. Tax increments will decrease
in 2024 due to two newly decertified districts. Intergovernmental revenues are projected to
increase in 2024 due to grants received to offset operating costs for two items (public safety aid
and Emerald Ash Borer management) and capital costs for five projects: Downtown Pedestrian
& Roadway Improvements, East Broadway Improvements, School Boulevard Improvements,
West County Road 39 Pedestrian Improvements design, and Transportation Economic
Development (TED) Intersection Improvements. Special assessments decrease due to regular
amortization, which is accelerated by prepayments when properties change ownership. The
decrease in contributed capital reflects conservative projections. Operating transfers decrease
in 2024 since 2023 were larger from the Liquor and Deputy Registrar funds transferring fund
balances to the Capital Projects Fund to pay for the Downtown Pedestrian & Roadway
Improvements Project. Debt is projected to be issued in 2024 for the construction of a new
Public Works Facility; additional debt may be issued in 2025 to complete the project.
TOTAL ALL FUNDS 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 11,540,278$ 11,795,057$ 12,452,000$ 12,517,392$ 13,525,000$ 8.6%
Tax Increments 732,688 720,301 529,000 550,598 258,000 -51.2%
Franchise & Other Taxes 461,898 469,437 506,500 425,618 521,500 3.0%
Sale of Goods 7,104,357 7,168,374 7,357,694 7,042,543 7,504,849 2.0%
Licenses & Permits 810,239 615,185 486,000 933,766 489,000 0.6%
Intergovernmental Revenues 4,007,667 2,414,661 2,773,395 1,601,875 6,153,513 121.9%
Charges for Services 11,747,161 13,057,922 12,098,188 14,700,945 12,724,236 5.2%
Fines & Forfeits 49,566 36,808 51,600 52,413 51,600 0.0%
Special Assessments 1,797,837 780,485 397,924 1,500,192 361,098 -9.3%
Miscellaneous 943,084 368,416 1,271,699 4,127,345 1,255,704 -1.3%
Contributed Capital 1,103,131 653,224 184,000 3,413,541 85,500 -53.5%
Operating Transfers In 8,952,690 461,626 4,006,000 4,753,950 1,106,000 -72.4%
Debt Proceeds - - 5,000,000 - 30,000,000 500.0%
TOTAL REVENUES 49,250,597$ 38,541,499$ 47,114,000$ 51,620,177$ 74,036,000$ 57.1%
EXPENDITURES
Personnel Services 6,449,844$ 7,708,213$ 8,223,067$ 7,913,269$ 8,634,845$ 5.0%
Supplies 6,463,849 6,681,628 7,260,349 6,752,441 7,314,954 0.8%
Other Services & Charges 10,031,712 12,496,138 13,427,163 11,585,187 13,211,407 -1.6%
Capital Outlay 7,888,500 3,562,968 20,246,630 12,632,259 48,595,271 140.0%
Debt Service 7,314,973 2,857,810 3,039,791 2,662,399 3,033,523 -0.2%
Operating Transfers Out 8,952,689 461,627 4,006,000 4,753,950 1,106,000 -72.4%
TOTAL EXPENDITURES 47,101,568$ 33,768,384$ 56,203,000$ 46,299,504$ 81,896,000$ 45.7%
FUND BALANCE - JANUARY 1 55,735,014$ 57,884,044$ 62,657,159$ 62,657,159$ 67,977,832$
Excess (Deficiency) of
Revenues over Expenditures 2,149,030 4,773,115 (9,089,000) 5,320,673 (7,860,000)
FUND BALANCE - DECEMBER 31 57,884,044$ 62,657,159$ 53,568,159$ 67,977,832$ 60,117,832$
64Table of Contents
Personnel services budget increased by a 4.0% wage and health benefit increase budgeted in
2024. Increased hours for a couple of part-time positions add to the budgeted increase.
Estimated capital outlay expenditures increase due to construction on several large projects the
have been in the planning stages for a few years. These projects include completion of the
Downtown Pedestrian & Roadways Improvements, construction of a new Public Works Facility,
progress on The Pointes at Cedar development area, additional Bertram Chain of Lakes Regional
Park Improvements, and School Boulevard & 7th Street Safety Improvements.
Debt service decreases in 2024 due to amortization of existing debt and no new debt issued.
The early redemption of one bond issue in 2021 caused a one-time large payment. Notable
operating transfers are from the Liquor Fund to the Capital Projects Fund to pay for the
Downtown Pedestrian & Roadway Improvements Project, and from the Deputy Registrar Fund
to the Community Center Fund for operating support.
More detailed information on each fund, including the major funds, is included later in this
document.
65Table of Contents
FUND BALANCE/WORKING CAPITAL
FUND BALANCE is calculated as governmental fund assets minus liabilities. WORKING CAPITAL
is the modified accrual balance of resources in enterprise funds after factoring out long-term
assets and liabilities that do not impact current, near-term operations.
The fund balances in all debt service subfunds, except the 2018A issuance, are projected to
decrease due to the planned spend down of accumulated fund balance, most notably from
prepaid assessment revenues received.
The Capital Projects Fund, Street Lighting Improvement Fund, and Park & Pathway
Improvement Fund are budgeted to decrease by more than 10% due to the planned use of fund
balance to support projects. Reimbursement resolutions have been passed for activity related
to the Public Works Facility, which allows the City to bond in 2024 and 2025 for project costs
expended on the project. The City budgeted to use reserves in the Capital Projects Fund for
some project costs in 2024 that will be reimbursed in future years when grant funding is paid
out from the State of Minnesota.
The Stormwater Fund is projected to decrease more than 10% due to project expenditures for
improvements to Ditch 33. While the working capital of the fud will decrease, the fund’s net
position as reported in the City’s Annual Comprehensive Financial Report will not decrease
since the cash will be spent to construction a capital asset. The Liquor Fund’s working capital
balance is estimated to decrease by more than 10% due to a budgeted transfer out to the
Capital Projects to capital improvements.
66Table of Contents
Projected Beginning Projected Ending
Fund Balance/Estimated Estimated Fund Balance/
Working Capital Revenues Appropriations Working Capital
General Fund 7,747,193$ 12,757,000$ (12,757,000)$ 7,747,193$
Special Revenue Funds
Cemetery 148,212 42,000 (31,000) 159,212
Small Community Development Grant 939,514 8,000 - 947,514
Monticello Community Center 473,085 2,058,000 (2,058,000) 473,085
Total Special Revenue Funds 1,560,810 2,108,000 (2,089,000) 1,579,810
Debt Service Funds
2015B G.O. Bonds 112,172 186,000 (214,000) 84,172
2016A G.O. Bonds 158,512 428,000 (529,000) 57,512
2017A G.O. Bonds 158,350 364,000 (470,000) 52,350
2018A G.O. Bonds 81,849 441,000 (448,000) 74,849
2019A G.O. Bonds 53,913 726,000 (711,000) 68,913
2020A G.O. Bonds 163,139 135,000 (234,000) 64,139
Total Debt Service Funds 727,936 2,280,000 (2,606,000) 401,936
Capital Project Funds
Capital Projects 9,379,693 36,830,000 (41,785,000) 4,424,693
Street Lighting Improvement 1,697,878 185,000 (1,430,000)452,878
Park & Pathway Improvement 829,888 - (87,000) 742,888
Park Dedication 158,147 1,000 - 159,147
Total Capital Project Funds 12,065,606 37,016,000 (43,302,000) 5,779,606
Enterprise Funds
Water 10,272,346 1,885,000 (2,404,000) 9,753,346
Sewer 14,901,013 3,203,000 (3,356,000) 14,748,013
Stormwater 3,953,598 1,992,000 (2,599,000) 3,346,598
Liquor 1,436,255 7,517,000 (7,747,000) 1,206,255
Deputy Registrar 958,939 918,000 (995,000) 881,939
Fiber Optics 1,767,459 2,000,000 (1,883,000) 1,884,459
Total Enterprise Funds 33,289,611 17,515,000 (18,984,000) 31,820,611
Internal Service Funds
Facilities Maintenance 98,188 435,000 (435,000) 98,188
IT Services 316,692 560,000 (560,000) 316,692
Central Equipment 4,409,968 588,000 (355,000) 4,642,968
Benefit Accrual 355,959 12,000 (12,000) 355,959
Total Internal Service Funds 5,180,808 1,595,000 (1,362,000) 5,413,808
Discretely Presented Component Unit (1) (1)
Economic Development Authority 7,405,869 765,000 (796,000) 7,374,869
Total All Funds 67,977,833$ 74,036,000$ (81,896,000)$ 60,117,833$
CHANGES IN FUND BALANCE/WORKING CAPITAL - FISCAL YEAR 2024
67Table of Contents
Adopted
Actual Actual Budget Estimated Budget
2021 2022 2023 2023 2024
General Fund 6,624,781$ 7,042,795$ 7,042,795$ 7,747,193$ 7,747,193$
Special Revenue Funds
Cemetery 80,184 117,844 128,844 148,212 159,212
Small Community Development Grant 924,622 898,209 906,209 939,514 947,514
Monticello Community Center 389,738 449,419 449,419 473,085 473,085
Total Special Revenue Funds 1,394,544 1,465,472 1,484,472 1,560,810 1,579,810
Debt Service Funds
2011A G.O. Refunding Bonds (2005A)109,551 - - - -
2015B G.O. Bonds 135,877 121,706 94,706 112,172 84,172
2016A G.O. Bonds 368,684 313,731 142,731 158,512 57,512
2017A G.O. Bonds 280,978 274,359 146,359 158,350 52,350
2018A G.O. Bonds 80,503 79,500 77,500 81,849 74,849
2019A G.O. Bonds 49,780 48,734 48,734 53,913 68,913
2020A G.O. Bonds 98,836 136,277 125,277 163,139 64,139
Total Debt Service Funds 1,124,210 974,306 635,306 727,936 401,936
Capital Project Funds
Capital Project 11,862,620 10,868,752 9,613,752 9,379,693 4,424,693
Street Lighting Improvement 1,180,207 1,257,883 49,883 1,697,878 452,878
Park & Pathway Improvement 1,100,572 1,207,608 834,608 829,888 742,888
Park Dedication 41 100,705 101,705 158,147 159,147
Total Capital Project Funds 14,143,440 13,434,947 10,599,947 12,065,606 5,779,606
Enterprise Funds
Water 6,511,005 7,538,719 7,056,719 10,272,346 9,753,346
Sewer 9,601,117 11,416,132 10,856,132 14,901,013 14,748,013
Stormwater 2,800,863 3,180,382 3,156,382 3,953,598 3,346,598
Liquor 2,032,400 2,831,082 1,191,082 1,436,255 1,206,255
Deputy Registrar 2,195,481 2,258,160 587,160 958,939 881,939
Fiber Optics 698,071 1,287,975 1,217,975 1,767,459 1,884,459
Total Enterprise Funds 23,838,937 28,512,450 24,065,450 33,289,611 31,820,611
Internal Service Funds
Facilities Maintenance (33,854) 35,905 35,905 98,188 98,188
IT Services 260,444 238,348 238,348 316,692 316,692
Central Equipment 3,170,333 3,725,643 3,074,643 4,409,968 4,642,968
Benefit Accrual 353,116 341,230 341,230 355,959 355,959
Total Internal Service Funds 3,750,039 4,341,127 3,690,127 5,180,808 5,413,808
Discretely Presented Component Unit
Economic Development Authority 7,008,094 6,886,062 6,050,062 7,405,869 7,374,869
Total All Funds 57,884,044$ 62,657,160$ 53,568,160$ 67,977,833$ 60,117,833$
ENDING FUND BALANCE/WORKING CAPITAL HISTORY
Fiscal Year Ended December 31,
68Table of Contents
REVENUE TRENDS & ANALYSIS
Revenues are conservatively estimated for every fund type. The schedule of revenue estimates
below is supported by detailed revenue estimates for each fund in subsequent sections. This
section of the budget highlights major revenue sources for all the city funds as combined and
for key governmental and enterprise funds: General Fund and Monticello Community Center
Fund (governmental funds), along with the Water, Sewer, Stormwater, Liquor, Deputy Registrar
and Fiber Optics funds (enterprise funds). Trends for these funds and individual revenues are
shown together with estimates for the coming year.
TOTAL CITY REVENUES AND OTHER SOURCES
Property taxes, charged to all non-exempt parcels in city limits, account for the single largest
revenue source for the city. Property taxes are levied for the following funds: General,
Monticello Community Center, Debt Service, Capital Projects, and Economic Development
Authority. Budget estimates are based off the final levy certified.
After property taxes, tax increments are another major revenue source of revenue for the
Economic Development Fund accounting for 34% of 2024 budgeted revenues. This fund
accounts for the city’s tax increment financing (TIF) districts and other economic development
activities of the Monticello Economic Development Authority. Budget estimates are taken from
the prior year’s TIF collections and adjusted for known changes to each TIF district.
Franchise & other taxes are difficult to predict because the cable franchise fees are paid to the
Sherburne-Wright Cable Commission, of which the city is a member. Cable franchise fees are
only remitted to the city if the commission votes to do so.
Sales of goods reflect sales at the city’s Hi-Way Liquors off-sale store. Budget estimates are
calculated assuming a modest amount of inflation and using analysis of the actual sales trends
over the past 3-5 years.
Intergovernmental revenues are projected to increase due to grants received to offset project
costs for five projects: Downtown Pedestrian & Roadway Improvements, East Broadway
Improvements, School Boulevard Improvements/Roundabout Construction, West 39 Pedestrian
TOTAL ALL FUNDS 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 11,540,278$ 11,795,057$ 12,452,000$ 12,517,392$ 13,525,000$ 8.6%
Tax Increments 732,688 720,301 529,000 550,598 258,000 -51.2%
Franchise & Other Taxes 461,898 469,437 506,500 425,618 521,500 3.0%
Sale of Goods 7,104,357 7,168,374 7,357,694 7,042,543 7,504,849 2.0%
Licenses & Permits 810,239 615,185 486,000 933,766 489,000 0.6%
Intergovernmental Revenues 4,007,667 2,414,661 2,773,395 1,601,875 6,153,513 121.9%
Charges for Services 11,747,161 13,057,922 12,098,188 14,700,945 12,724,236 5.2%
Fines & Forfeits 49,566 36,808 51,600 52,413 51,600 0.0%
Special Assessments 1,797,837 780,485 397,924 1,500,192 361,098 -9.3%
Miscellaneous 1,064,694 375,504 1,271,699 6,516,938 1,255,704 -1.3%
Contributed Capital 981,521 646,137 184,000 1,023,947 85,500 -53.5%
Operating Transfers In 8,952,690 461,626 4,006,000 4,753,950 1,106,000 -72.4%
Debt Proceeds - - 5,000,000 - 30,000,000 500.0%
TOTAL REVENUES 49,250,597$ 38,541,499$ 47,114,000$ 51,620,177$ 74,036,000$ 57.1%
69Table of Contents
Improvements, and Ditch 33 Improvements.
Charges for services reflect increases in the city’s fee schedule, including refuse and recycling
charges, and community center membership and day pass fees. The city uses conservative
revenue budgeting practices to ensure revenues will be sufficient to meet operating needs.
Special assessments decrease due to regular amortization, which is accelerated by prepayments
when properties change ownership.
Miscellaneous revenues, including donations, interest earned on investments, and rebates
related to a solar farm investment, are conservatively estimated based on prior year trends.
Known factors, such as the number of kilowatt-hours (kWh) subscribed in the solar program,
are included into the 2024 budget assumptions. While the investment earnings—the largest
portion of this revenue classification—have increased with higher rates in the market,
adjustments to market value create volatility that makes estimating difficult.
Operating transfers are expected to decrease in 2024 because the Liquor and Deputy Registrar
funds made transfers to the Capital Projects Fund to pay for the Downtown Pedestrian &
Roadway Improvements Project in 2023. While an additional $1 million is budgeted in 2024
from the Liquor Fund to the Capital Projects Fund, the Deputy Registrar will transfer only
$100,000 to the Community Center Fund.
Debt is projected to be issued for the beginning stages of construction of a new Public Works
Facility; additional debt may be issued in 2025 to complete the project.
The chart below provides an overall picture of estimated 2024 revenues and other sources. Any
categories showing 0% are simply rounded from less than 0.5%.
Property Taxes
18%Tax Increments
0%
Franchise &
Other Taxes
1%
Sale of Goods
10%
Licenses &
Permits
1%
Intergovernmental
Revenues
8%Charges for
Services
17%
Fines & Forfeits
0%
Special
Assessments
0%
Miscellaneous
2%Contributed
Capital
0%Operating
Transfers In
2%
Debt Proceeds
41%
2024 Revenues by Category -All Funds
70Table of Contents
PROPERTY TAXES
The city relies on property taxes to support functions such as general government, public
safety, public works, recreation and culture, capital outlay and debt service. For 2024, the
council adopted a general levy of $13,074,000, which is $1.024,000 (8.5%) greater than the
prior year. The EDA and council also adopted a Housing and Redevelopment Authority (HRA)
special benefit levy of $451,000, which is $49,000 (12.2%) greater than 2023. The HRA levy is
recorded in the Economic Development Authority (EDA) Fund.
The following chart reflects the changes in the tax levy over the last ten years:
Accounting for a variety of activities, the General Fund will receive 64% of the 2024 property
tax levy. However, property taxes provide 70% of the General Fund’s revenue. The levy for the
Monticello Community Center (MCC) increased $30,000 (6.2%) to $515,000. The following chart
represents the distribution of the tax levy for 2024.
When determining the property tax levy, City Council and staff consider the impact the levy will
have on various property owners. This impact is then balanced against services provided and
service levels. Estimated market values are converted to tax capacity by using specific state
formulas for various types of properties.
$-
$2
$4
$6
$8
$10
$12
$14
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024MillionsCity & HRA Property Tax Levies
City Tax Levy HRA Levy
General Fund
$8,640,000
64%
MCC Operations
$525,000
4%
HRA Levy
$451,000
3%
Capital
$1,882,825
14%
Debt Service
$2,026,175
15%
2024 Property Tax Levy
71Table of Contents
GENERAL FUND
The General Fund is used to account for all financial resources of the city, except for those
required to be accounted for in another fund. Major functions supported by General Fund
revenues include administration and finance, police and fire services, public works, and
recreation and culture.
Revenue is estimated to be $12,757,000 (+11.1%) for the 2024 budget year. The primary
General Fund source of revenue is property taxes at $8,640,000 (+7.2%), which accounts for
70% of total revenues. At 11% and 7%, charges for services and miscellaneous revenues are the
only other categories to exceed 5% of total revenues.
The following charts depicts General Fund revenues as represented in the 2024 adopted
budget:
The following chart represents General Fund revenues trends.
MONTICELLO COMMUNITY CENTER
The Monticello Community Center (MCC) provides a facility with space for a variety of
recreational, professional, and educational opportunities. Aside from its portion of the property
tax levy, the MCC is supported by a variety of fees for memberships, activities, rentals, and
concessions. Council passed a revenue policy that requires the MCC to cover 85% of its
General Fund Revenues -2024
Property Taxes (68%)
Franchise & Other Taxes (3%)
Licenses & Permits (4%)
Intergovernmental Revenues (8%)
Charges for Services (10%)
All Other (7%)
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
ACTUAL ACTUAL BUDGET BUDGET
2021 2022 2023 2024
Revenues -General Fund
Miscellaneous
Fines & Forfeits
Charges for Services
Intergovernmental
Revenues
Licenses & Permits
Franchise & Other Taxes
72Table of Contents
operating costs—including equipment—with fees and charges. The effects of the COVID-19
pandemic have affected the ability of this fund to meet that threshold. American Rescue Plan
Act (ARPA) funds were used to supplement the reduction of charges for services revenues in
2021 – 2023. Beginning in 2024, the Deputy Registrar Fund will transfer in funds to provide
additional assistance to the Community Center Fund.
In the following chart, 2021 and 2022 are actual amounts and 2023 and 2024 are estimates.
WATER AND SEWER FUNDS
Water and sewer charges for services are primarily comprised of providing Monticello residents
and businesses with water and sewer services. Based partially on the level of consumption,
these utility funds each have separate charges for delivered services. The city sets rates to
cover operating costs, a portion of depreciation, and debt service. The water and sewer funds
are expected to provide some level of future support for debt service incurred to make water
and sewer system improvements.
In 2018, the sewer fund shows increased revenue because the city sold a parcel of property
that had been used for storage and a bio-solids site. With 2024 shown as a projected amount,
the following chart plots revenues for water and sewer services on the primary axis (left)
against gallons of water sold on the secondary axis (right):
Water service charges have two components: base charge with a minimum usage amount and
consumption charge for usage above the minimum amount. Rates have increased steadily over
the last ten years: average annual base and consumption charge increases were around 6.2%.
$-
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
$1,800,000
$2,000,000
$2,200,000
ACTUAL ACTUAL BUDGET BUDGET
2021 2022 2023 2024
Revenues -Community Center Fund
Operating Transfers In
Miscellaneous
Charges for Services
Intergovernmental
Revenues
Property Taxes
0
100
200
300
400
500
600
700
$0.0
$0.5
$1.0
$1.5
$2.0
$2.5
$3.0
$3.5
$4.0
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
(Proj)Gallons Sold (Millions)Revenues (Millions)Water & Sewer Revenues
Water Revenue
Sewer Revenue
H20 Sold (Gallons)
73Table of Contents
Sewer charges, like water charges, have two components: base charge with a minimum usage
amount and consumption charge for usage above the minimum amount. Rates have increased
steadily over the years: average annual base and consumption charge increases were 4.7%.
For 2024, increases of 8% for water and 3% for sewer, for both the base rate and usage rates,
were included in the budget for both funds. The following chart reflects the water and sewer
base rates over the last ten years:
STORMWATER FUND
The Stormwater Fund was established in 2019 along with the creation of a per drainage unit
user charge. Each residential dwelling is equivalent to one drainage unit, and non-residential
properties are equivalent to 7 drainage units per rounded impervious surface area. The fee
increases to $4.75/month in 2024.
DEPUTY REGISTRAR (DMV)
The city is authorized by the State of Minnesota to operate a DMV. Fees collected from motor
vehicle licenses are the DMV’s main revenue source. Fees are regulated by the state.
The following chart shows the history of DMV revenues by transaction type over a five-year
period. The State transitioned to the MNLARS system in 2019 and to MNDrive in 2020. All three
systems measured transactions differently which creates skewed numbers in the graph below.
However, 2020 and 2021 were incredibly busy years for the DMV as the COVID-19 pandemic
caused changes in operations and increased car sales contributed to increased workload.
Motor vehicle licenses (new and renewals) as percentage of total transactions increased slightly
from 85% in 2022 to 86% in 2023.
$-
$2
$4
$6
$8
$10
$12
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024Monthly Base ChargeWater and Sewer Base Rates
Water
Sewer
$-
$200,000
$400,000
$600,000
$800,000
$1,000,000
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
2019 2020 2021 2022 2023
DMV Transactions by Type & Annual Revenues
Drivers License ($8)
Game & Fish ($1)
DNR ($2-$7)
Motor vehicle ($6-$10)
Annual Revenue
74Table of Contents
LIQUOR FUND
With total 2023 sales of $7.05 million, Monticello’s municipal liquor store ranks in the top 3 of
Minnesota cities with only one store. While the COVID-19 pandemic caused a rapid increase in
sales in 2020, revenue growth slowed in 2021, remained steady in 2022, and decreased slightly
in 2023. Total sales have climbed an average of 3.4% for the last five years (16.2% alone in
2020); other and liquor are the fastest growing categories averaging 8.1% and 4.7%,
respectively, over five years.
The 2024 Liquor Fund budget reflects a projected sales trend to increase once again. The
Liquor Fund has one retail outlet: Hi-Way Liquors. This fund provides vital resources for many
community projects including Bertram Chain of Lakes, Downtown Improvements and other
capital items. Conservative revenue estimates are used for budgeting purposes. However, 2024
net cash flow from operations should remain stable around $750,000.
Beer accounts for approximately 51% of total sales; liquor and wine follow at 33% and 12%,
respectively. Non-alcohol items contribute 4%. Beer typically has the lowest gross margin at
24% and wine the highest at 38%. Liquor is in the middle at about 30%. The chart below
provides sales information by category:
Beer
51%
Liquor
33%
Wine
12%
Misc.
4%
Hi-Way Sales by Category -2023
Liquor Store Revenue by Category
Category 2019 2020 2021 2022 2023 5 Yr Chg
Beer 3,252,142$ 3,838,912$ 3,665,223$ 3,695,976$ 3,571,363$ 10%
% Change 6.0% 18.0% -4.5% 0.8% -3.4%
Liquor 2,019,096$ 2,351,072$ 2,276,808$ 2,340,709$ 2,350,700$ 16%
% Change 7.1% 16.4% -3.2% 2.8% 0.4%
Wine 894,005$ 982,113$ 915,444$ 882,772$ 855,693$ -4%
% Change 0.6% 9.9% -6.8% -3.6% -3.1%
Other 211,687$ 235,777$ 253,775$ 257,966$ 276,834$ 31%
% Change 12.4% 11.4% 7.6% 1.7% 7.3%
Total Sales 6,376,930$ 7,407,874$ 7,111,250$ 7,177,423$ 7,054,590$ 11%
% Change 5.6% 16.2% -4.0% 0.9% -1.7%
75Table of Contents
FIBER OPTICS FUND (FiberNet)
Monticello’s telecommunications utility, FiberNet Monticello, provides internet, voice
(telephone) and video (TV) services. City residential and commercial customers can subscribe to
one, two, or all three services. FiberNet continues to face competition from two large private
providers with significant resources and challenges with the societal shift away from traditional
telephone and television services. As a result, subscriber counts for voice and video have
declined in recent years. Internet has shown occasional growth with more customers
streaming video services.
The data in the graphs below shows trends FiberNet subscribers since 2015:
In July 2016, the city contracted with Arvig to manage FiberNet. The contract was renewed for
an additional 5 years in 2021. Through leaner operations, shared resources, and economies of
scale, the Fiber Optics Fund has had positive cash flow from operations since 2019. However,
potential new service areas will cause increases in capital costs. Arvig consistently assesses the
marketplace and service delivery costs and will raise prices as needed.
714 643 526 451 385 323 289 256 233
1,424 1,506 1,545 1,549 1,631 1,801 1,808 1,752 1,701
518 465 427 383 354 315 297 275 248
0
500
1,000
1,500
2,000
2,500
3,000
2015 2016 2017 2018 2019 2020 2021 2022 2023
FiberNet Subscribers By Type
Phone
Television
Internet
76Table of Contents
TAX LEVY HISTORY
2021 2022 2023 2024
General Fund $7,169,000 $7,475,000 $8,060,000 $8,640,000
Percent Change 5.6% 4.3% 7.8% 7.2%
Special Revenue Funds
Monticello Community Center 485,000 485,000 515,000 525,000
Percent Change 16.3% 0.0% 6.2% 1.9%
Debt Service Fund
2014A GO Judgement Bonds 513,570 - - -
2015B GO Bonds 201,115 192,650 164,435 165,223
2016A GO Bonds 406,089 406,929 282,559 357,979
2017A GO Bonds 430,097 427,367 299,532 326,842
2018A GO Bonds 448,077 451,812 444,232 439,337
2019A GO Bonds 714,945 709,446 697,133 711,964
2020A GO Bonds 117,586 123,196 111,690 24,830
Total Debt Service Fund 2,831,479 2,311,400 1,999,581 2,026,175
Percent Change -3.7% -18.4% -13.5% 1.3%
Capital Project Funds
Capital Projects Fund 578,221 1,081,600 1,475,419 1,882,825
Percent Change 92.7% 87.1% 36.4% 27.6%
Discrete Component Units
Economic Development Authority 366,300 388,000 402,000 451,000
Percent Change 22.1% 5.9% 3.6% 12.2%
Total Tax Levy - All Funds $11,430,000 $11,741,000 $12,452,000 $13,525,000
Percent Change 5.8% 2.7% 6.1% 8.6%
Levy Summary
City General and Debt Levies 11,063,700$ 11,353,000$ 12,050,000$ 13,074,000$
Percent Change 5.9% 2.6% 6.1% 8.5%
HRA Levy 366,300$ 388,000$ 402,000$ 451,000$
Percent Change 3.2% 5.9% 3.6% 12.2%
TAX LEVY HISTORY
77Table of Contents
TAX CAPACITY HISTORY
The Housing Redevelopment Authority (HRA) special benefit levy is capped at 0.0185% of the
city’s taxable market value. The city’s taxable market value for taxes collected in 2024 totaled
$2,440,585,300. HRA levy proceeds can only be used for purposes included in the HRA Act
(Minnesota Statutes, Section 469.033, subd. 6). Those purposes include redevelopment to
correct or prevent blight and development of, or assistance to, housing for low- or moderate-
income persons.
In 2023, Northern States Power (dba Xcel Energy), the city’s largest taxpayer, succeeded in
getting the Minnesota Department of Revenue to lower the estimated market value of its
nuclear power plant yet again for taxes payable in 2024. Xcel’s estimated market value
decreased by 4.6%, and because residential and commercial tax base grew significantly, the
city’s tax capacity increased overall, but the tax burden shifted away from Xcel to the other
taxpayers.
The graph below reflects the annual change in the city’s property tax levy and the annual
change in Xcel’s property taxes owed. If the green column is larger than the blue column, Xcel
absorbed the entire levy and lowered the taxes paid by others. In the case where the green
column is negative, other taxpayers paid for the entire levy increase plus the amount Xcel’s
taxes declined.
2021 2022 2023 2024
Tax Capacity 31,026,583$ 31,073,603$ 34,393,769$ 37,229,832$
Percent Change 3.9% 0.2% 10.7% 8.2%
City Levy - Tax Capacity Rate 35.659 36.536 35.035 35.117
Percent Change 2.0% 2.5% -4.1% 0.2%
HRA Levy - Tax Capacity Rate 1.181 1.249 1.169 1.211
Percent Change -0.6% 5.8% -6.4% 3.6%
TAX CAPACITY HISTORY
$(400,000)
$(200,000)
$-
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
City Levy and Xcel Property Tax Change
City Levy Increase Xcel Change in City Taxes
78Table of Contents
LARGEST PROPERTY TAXPAYER
The city’s largest property taxpayer is Northern States Power (dba Xcel Energy). In 2011, Xcel
completed the first of two major uprates (energy producing improvements) at its nuclear
power plant, which is located just inside the western boundary of the city. The second uprate
was completed in 2013. The uprates resulted in major tax capacity increases for tax collection
years 2013 and 2015. Current year property taxes are calculated on the taxable market value on
January 2 of the prior year. For tax year 2019, Xcel was successful in getting the Minnesota
Department of Revenue to change the valuation method for the plant. As a result, the plant
valuation dropped by nearly $81 million. The below schedule and graph reflect the importance
of the plant to the city’s tax base:
The plant’s percentage of the city’s total tax capacity (and its share of the annual property tax
levies) has been significant for many years. In 2015 the percentage rose above 60% and
remained there until 2019, when it dropped to 56%. The percentage has continued to decline,
and 2024 estimates calculate Xcel’s percentage of tax base at 40%. This tax capacity decline
means the city’s other taxpayers absorbed more of the tax levy.
Tax
Year Amount $ Change Amount $ Change % Chg.Amount $ Change % Chg.
2015 706,645,500$ 258,161,300$ 14,132,910$ 5,163,226$ 58% 5,050,410$ 1,040,132$ 26%
2016 779,539,900$ 72,894,400$ 15,590,798$ 1,457,888$ 10% 5,374,045$ 323,635$ 6%
2017 832,073,500$ 52,533,600$ 16,641,470$ 1,050,672$ 7% 5,520,059$ 146,014$ 3%
2018 877,855,100$ 45,781,600$ 17,557,102$ 915,632$ 6% 5,676,496$ 156,437$ 3%
2019 789,572,500$ (88,282,600)$ 15,791,450$ (1,765,652)$ -10% 5,410,467$ (266,029)$ -5%
2020 780,422,700$ (9,149,800)$ 15,608,454$ (182,996)$ -1% 5,457,964$ 47,497$ 1%
2021 806,039,800$ 25,617,100$ 16,120,796$ 512,342$ 3% 5,748,515$ 290,551$ 5%
2022 751,329,900$ (54,709,900)$ 15,026,598$ (1,094,198)$ -7% 5,490,118$ (258,397)$ -4%
2023 779,129,106$ 27,799,206$ 15,582,582$ 555,984$ 4% 5,459,358$ (30,760)$ -1%
2024 743,289,167$ (35,839,939)$ 14,865,783$ (716,799)$ -5% 5,220,417$ (238,941)$ -4%
Northern States Power (dba Xcel Energy)
Taxable Market Value Tax Capacity City Property Tax on Plant
$707
$780 $832 $878
$790 $780 $806 $751 $779 $743
$-
$100
$200
$300
$400
$500
$600
$700
$800
$900
$1,000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024MillionsXcel Power Plant -Taxable Market Value
79Table of Contents
REVENUE SOURCES BY FUND
Property Tax Franchise Sale of Licenses/
Taxes Increments & Other Taxes Goods Permits Intergovernmental
General Fund 8,640,000$ -$ 346,500$ -$ 487,000$ 1,057,000$
Special Revenue Funds
Cemetery - - - - - -
Small Cities Development Program - - - - - -
Monticello Community Center 525,000 - - - - -
Total Special Revenue Funds 525,000 - - - - -
Debt Service Funds
2015B G.O. Bonds 165,223 - - - - -
2016A G.O. Bonds 357,979 - - - - -
2017A G.O. Bonds 326,842 - - - - -
2018A G.O. Bonds $439,337 - - - - -
2019A G.O. Bonds 711,964 - - - - -
2020A G.O. Bonds 24,830 - - - - -
Total Debt Service Funds 2,026,175 - - - - -
Capital Project Funds
Capital Project 1,882,825 - - - - 3,766,513
Street Lighting Improvement - - 175,000 - - -
Park & Pathway Improvement - - - - - -
Park Dedication - - - - - -
Total Capital Project Funds 1,882,825 - 175,000 - - 3,766,513
Enterprise Funds
Water - - - - 2,000 -
Sewer - - - - - -
Stormwater - - - - - 1,330,000
Liquor - - - 7,504,849 - -
Deputy Registrar - - - - - -
Fiber Optics - - - - - -
Total Enterprise Funds - - - 7,504,849 2,000 1,330,000
Internal Service Funds
Facilities Maintenance - - - - - -
IT Services - - - - - -
Central Equipment - - - - - -
Benefit Accrual - - - - - -
Total Internal Service Funds - - - - - -
Discretely Presented Component Unit
Economic Development Authority 451,000 258,000 - - - -
Total All Funds 13,525,000$ 258,000$ 521,500$ 7,504,849$ 489,000$ 6,153,513$
Revenue Classifications
80Table of Contents
Charges for Fines &Special Miscell-Contributed Operating Debt
Services Forfiets Assessments aneous Capital Transfers Proceeds Total
General Fund 1,309,743$ 51,600$ 100$ 865,057$ -$ -$ -$ 12,757,000$
Special Revenue Funds
Cemetery 41,700 - - 300 - - - 42,000
Small Cities Development Program - - - 8,000 - - - 8,000
Monticello Community Center 1,399,400 - - 33,600 - 100,000 - 2,058,000
Total Special Revenue Funds 1,441,100 - - 41,900 - 100,000 - 2,108,000
Debt Service Funds
2015B G.O. Bonds - - 19,000 1,777 - - - 186,000
2016A G.O. Bonds - - 68,528 1,493 - - - 428,000
2017A G.O. Bonds - - 35,488 1,670 - - - 364,000
2018A G.O. Bonds - - - 1,663 - - - 441,000
2019A G.O. Bonds - - 12,787 1,249 - - - 726,000
2020A G.O. Bonds - - 108,776 1,394 - - - 135,000
Total Debt Service Funds - - 244,579 9,246 - - - 2,280,000
Capital Project Funds
Capital Project - - 105,640 75,022 - 1,000,000 30,000,000 36,830,000
Street Lighting Improvement - - - 10,000 - - - 185,000
Park & Pathway Improvement - - - - - - - -
Park Dedication - - 779 221 - - - 1,000
Total Capital Project Funds - - 106,419 85,243 - 1,000,000 30,000,000 37,016,000
Enterprise Funds
Water 1,801,955 - 10,000 56,045 15,000 - - 1,885,000
Sewer 3,173,344 - -29,656 - - - 3,203,000
Stormwater 595,000 - -7,000 60,000 - - 1,992,000
Liquor - - - 12,151 - - - 7,517,000
Deputy Registrar 900,000 - - 18,000 - - - 918,000
Fiber Optics 1,988,600 - - 11,400 - - - 2,000,000
Total Enterprise Funds 8,458,899 - 10,000 134,252 75,000 - - 17,515,000
Internal Service Funds
Facilities Maintenance 385,000 - - 50,000 - - - 435,000
IT Services 549,994 - - 10,006 - - - 560,000
Central Equipment 567,500 - - 10,000 10,500 - - 588,000
Benefit Accrual 12,000 - - - - - - 12,000
Total Internal Service Funds 1,514,494 - - 70,006 10,500 - - 1,595,000
Discretely Presented Component Unit
Economic Development Authority - - - 50,000 - 6,000 - 765,000
Total All Funds 12,724,236$ 51,600$ 361,098$ 1,255,704$ 85,500$ 1,106,000$ 30,000,000$ 74,036,000$
Revenue Classifications (continued)
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LONG RANGE FINANCIAL PLANS
General Fund Community Center EDA Capital Projects
Routine
Expenditures
Expected to rise at the pace
of inflation but mitigated by
gains in productivity. Some
capital expenditures are
incorporated as routine
through rental charges by
internal service funds.
Additions to staff and an
increase to the law
enforcement rate and patrol
have an impact going
forward.
Expected to rise at the pace
of inflation. Routine capital
expenditures vary by year,
but are being completed
modestly and strategicly as
the current ecomony
continues to affect
discretionary spending such
as fitness memberships.
Non-TIF expenditures are
expected to rise at the pace
of inflation.
N/A
Non-routine
Expenditures
Basic level of non-routine
items are included in overall
budget but vary within each
budget unit from year-to-
year.
Large R&M items and capital
expenditures could be
supported by transfers from
other funds. The only CIP
purchases budgeted in 2023
are for small tools and
equipment or building
repairs run through the
operating budget.
Tax increment financing (TIF)
expenditures will vary
considerably from year-to-
year in each district as
development occurs.
Large capital projects may
receive funding from debt
issuance, typically as a
reimbursement of spent
reserves.
Major projects in 2023
include improvements in
the Downtown, Pointes at
Cedar, and Bertram Chain of
Lakes (BCOL) Regional Park.
Additionally, construction
of a PW Facility will begin.
Revenues
Property taxes provide 70%
of General Fund revenue. The
budget is somewhat limited
by sustainable growth in the
tax levy. The city looks to
diversify revenues by
implementing more charges
for services, as applicable.
Additional revenue is earned
from a solar farm investment
that began in 2020.
The property tax levy is set at
$515K in 2023. Ideally, user
fees will cover 85% on-going
expenditures. However, the
current ecomony continues
to affect discretionary
spending such as fitness
memberships. The fund has
been kept solvent by
American Rescue Plan Act
(ARPA) Federal grant dollars.
Tax increment revenues
widely vary from district to
district but not much from
year-to-year. Often reserves
(accumulation of prior year
increments) are used to fund
projects. The 2023 levy is
$402,000.
In the past, state street aid
has been used as temporary
financing and later replaced
with debt proceeds. The city
is analyzing a greater use of
reserves or other sources to
control its debt levels.
Debt
None: Indirectly supports
Central Equipment Fund debt
service through annual rental
payments.
No debt issues are
anticipated over the next five
years. Further, debt for
recreational projects either
requires voter approval or
must be incurred as part of a
lease-purchase agreement
with the EDA.
Intrafund loans from the EDA
General sub-fund will finance
some TIF activities. No
external debt issuance is
planned.
2023: $5M planned.
The city has a new Public
Works Facility included in
the CIP. The debt needed to
finance this project will be a
significant amount of the
city's debt capacity and is
planned for 202 and 2024.
Payments on these bonds
will be structured to take
advantage of the decline in
other tax supported debt.
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Water Sewer Liquor Fiber Optics Central Equipment
Routine
Expenditures
Expected to rise at the
pace of inflation but
mitigated by
reinvestment in plant
and equipment.
Annual capital
expenditures financed
on a pay-as-you-go
basis are estimated at
$760,000.
Expected to rise at the
pace of inflation but
mitigated by
reinvestment in plant
and equipment.
Annual capital outlays
financed on a pay-as-
you-go basis estimated
at $200,000.
Expected to rise at the
pace of inflation and
increases in demand.
Cost of sales are
typically passed onto
customers through
higher prices. The
Liquor Store maintains
a consistent gross
profit margin of 25%-
27%.
Since the management
agreement with Arvig
began in 2016,
FiberNet has seen
significant
improvement in
operations due to
lower costs from
economies of scale.
Routine expenditures
are now fully covered
by operating revenues.
Capital equipment
purchases will vary
widely every year. All
expenditures in this
fund are either for
capital equipment
purchases or debt
service.
Non-routine
Expenditures
2026 & 2029: $1.8M
trunk line
improvements with
Fallon Avenue street
improvement project.
2026: $1.2M Well 6.
2028: $28M water
treatment facility.
2023: $400k SCADA
systems & $500k
CSAH 39 extension.
2024: $750k Marvin
Rd lift station.
2025: $2.5M WWTP
improvements.
2026 & 2029: $5.5M
trunk line
improvements with
Fallon Avenue street
improvement project.
2031: $5M WWTP
improvements.
The fund generates
sufficient annual
revenues to support its
needs.
2024: $75k for parking
lot improvements.
2025: $50K for roof
repairs.
2026: $2M
construction of second
store. This will change
based on activity and
necessity.
Operating revenues are
currently adequate to
support non-routine
expenditures.
However, non-routine
expenditures are tied
to development, which
is unpredictable.
Reserves from recent
operating revenues
have been sufficient.
Anticipated future
expenditure by year:
2023: $1.34M; 2024:
$1.08M; 2025: $671k;
2026: $660k; 2022:
$1.16M.
The CIP reflects ideal
timing for replacement
of equipment, but will
be adjusted as
financing allows.
Revenues
User rates are high
enough to cover
planned expenditures
for the next five years.
In anticipation of a
new water treatment
plant in 2028, the city
is projecting 8% rate
increases over the next
5 years to fund capital
and operating costs
related to the plant.
User rates are
expected to rise to
provide for pay-as-you-
go routine system
replacement and debt
finance upgrades to
meet new
environmental
regulations.
Anticipated rate
increases are 3%
annually.
Sales have increased
steadily. 2020 was a
record year for sales at
a 16.2% increase. Sales
cooled, and the 2021
decreased 3.5%. 2022
sales were only 0.8%
higher than 2021.
Sales are expected to
return to normal
annual increases
around 5% in the
Revenues mainly
consist of charges for
services to those
subscribers to
FiberNet's services.
The original agreement
with Arvig expired on
June 30, 2021, and the
contract was re-
negotiated for an
additional 5 years term
through mid-2026.
Rental revenues
(expenditures in other
funds, funded by
revenues sources in
other funds) rise with
equipment purchases.
Excess fund balance in
the General Fund at
the end of 2021 was
transferred in for
future purchases.
Debt
No debt issues or
Minnesota Public
Facilities Authority
(MPFA) loans are
anticipated unless
external funding is
received related to
construction of a
Water Treatment
Facility (if so,
construction is
tentatively projected in
2028).
The Minnesota Public
Facilities Authority
(MPFA) may provide
funding for the future
projects. Revenue
bonds may be sold if
reserves are depleted.
No debt issues are
anticipated over next
five years.
No new debt is
planned for the future.
However, the
requirement to install
service to all new
developments could
call for issuing debt in
the future.
The 2014A Equipment
Bonds are paid out of
this fund. Future debt
issues will not be
needed if acquisitions
listed in the CIP are
adjusted to provide for
more level purchases
from year to year. A
debt service schedule
is contained in the
Internal Service section
of this report.
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As part of the budget process, council and staff review service needs, growth trends, and capital
investment requirements. A long-term financial plan (LTFP) model was developed in 2022 and
updated in 2023. However, the following discussion with focus on the city’s four main operating
funds: General, Monticello Community Center, Water, and Sewer. This is done in conjunction
with the Capital Improvement Plan (CIP), which is a five- to ten-year forecast that includes
funding sources. Financial planning is segregated into two components: operations for the four
main operating funds and capital investments (CIP).
The Stormwater Fund, Liquor Fund, Deputy Registrar Fund, and Fiber Optic Fund are not
specifically covered in this discussion. The Stormwater Fund is in its infancy, and the capital
needs and planning are still somewhat unknown. The liquor store and DMV are retail
operations with no major forecasted capital investment needs. The Fiber Optic Fund presents
challenges in a dynamic and competitive market where the strategies and business plan need
consistent refinement, especially considering the influence of development and industry trends,
both of which are outside of the city’s control.
Items impacting long range financial planning:
•Current financial position (fund balances) and growth trends, inflation, and aspirations
•Debt burden
•Tax base considerations and concentration
•Regulatory environment
•Condition of existing capital assets
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The city annually adopts a balanced budget for the General Fund. Consequently, the
expenditures line matches the revenue bar height each year. After 2024, annual expenditures
are projected to increase at 3% per year. The property tax levy and all other revenues are
projected to increase at the same rate as expenditures. According to policy, the city shall
maintain a fund balance of 60-75% of the following year’s budgeted expenditures. The
following charts assume the city will continue to provide the same current levels of service.
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Like the General Fund, the Monticello Community Center (MCC) Fund adopts a balanced
budget. Changes caused by the COVID-19 pandemic created budgetary challenges for the fund,
relying on American Rescue Plan Act (ARPA) funding from 2021 – 2023 to support the MCC
Fund. The following charts assume a modest return of patrons while providing the same current
levels of service. Future planning and budgets, including timing and magnitude of capital
improvements, will address the negative cash and fund balance issue identified in the LTFP.
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The Water Fund has future funding challenges with plans to construct a water treatment facility
which is planned for construction in 2024-2026. The fund has no direct debt and has adequate
reserves to cover almost any expenditure for other major capital projects, with a new well
planned for 2026. However, the city’s share of costs for the water treatment plant will require
the issuance of debt, which will be in the form of a State of Minnesota Public Facilities Authority
(PFA) loan. While the budget focuses on working capital, the LTFP presents net position which
includes long-term assets and debt as applicable. User charges and capital spending will be
adjusted to prevent the negative net position projected in future years.
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The Sewer Fund has its own funding challenges. Environmental regulatory changes may require
large investments in the wastewater treatment plant. Wastewater treatment plant
improvements are planned for 2024 and 2025. However, the model shows that the Sewer
Fund’s current projections are sustainable. Like the water fund, the LTFP presents net position
which includes long-term assets and debt as applicable rather than working capital which is
reported in the budget.
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LONG-TERM FISCAL OBJECTIVES
The city council and staff are committed to expending public resources in the most cost-
effective and economical manner possible to ensure the stability of the city property tax levy
and financial position. Considering changes to tax policy, state aid reductions for various
purposes, state-imposed levy limits in the past, and the potential of future levy limits, fiscal
strategies will need to be constantly monitored to ensure a balanced approach in providing
sufficient revenues to fund services.
1.Employ a strategy aimed at reducing the city’s reliance on the property tax levy to fund
basic services through sustainable revenue sources such as franchise fees, special revenues,
user fees, and charges for services.
The city’s property tax levy generates 68% of the General Fund’s revenue. This
overdependence is largely attributable to how state statutes allow cities to generate funding.
Monticello has a healthy tax base, which includes a nuclear power plant. The city’s tax levy was
above inflation for many years, however, that has not always been the case the past couple of
years. The assessed value at the nuclear power plant declined while all other property tax
classes increased, which caused another tax shift to other property taxpayers in the city. The
city’s levy was set at an 8.5% increase, which responds to the city’s increased costs due to
inflation while still aiming to control the impact to property taxpayers who are also feeling the
effects of inflation. The current council philosophy indicates a desire to balance the impacts to
taxpayers while not delaying necessary spending. While a growth plus inflation tax levy formula
would not reduce the dependence on property taxes, it would alleviate the strain placed on city
finances by inflation. City services will continue to be evaluated in relation to relevant funding
sources, promoting alternatives to traditional funding methodologies, and encouraging public-
private partnerships in service delivery systems.
2.The development and use of appropriate cost accounting structure which will lead to the
creation of individual cost centers for all city department activities to accurately reflect the
true cost of providing specific services.
The city employs a cost accounting system that is department specific and attempts to
accurately reflect service delivery costs at the department and division levels. By including all
supplemental services as they relate to personnel, charges and services, supplies, and capital
outlays, the city will further distinguish the total cost of services provided. The city analyzes
these costs at the sub-category detail levels in support of overall policy goals.
3.The adoption of a financial philosophy that seeks to spread the cost of significant capital
outlay expenditures over an extended period to ensure that current and future taxpayers
share equally in underwriting those costs.
The city continues to capitalize the cost of significant capital expenditures over several
years to ensure that both existing and future taxpayers share equally in the cost. In addition,
the city has dedicated a portion of the tax levy to underwrite the cost of selected capital
projects and equipment, avoiding a fiscal environment based on reactive tax and spending
policies. The five-year capital improvement planning process is critical in achieving these
results.
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4.The development of a long-term financial model (proforma) that identifies anticipated
trends in community growth and establishes a link between fiscal targets and budgetary
expenditures.
The city contracted with Northland Securities, Inc. in 2022 to develop a financial model,
which is used to determine the long-term impacts of present-day expenditures and financing
decisions. Fiscal assumptions are based upon a complex set of financial data including growth
factors, tax capacity valuations, per capita spending, and debt ratios. The proforma is utilized as
a tool as part of the budget planning process to ensure that key short-term fiscal targets are in
line with long-term fiscal projections. The city updates the proforma annually to ensure that
long-term fiscal outcomes remain consistent with council budgetary policies.
5.The development of work performance goals for each department to ascertain and
measure how each operating division contributes to the city’s overall public service mission.
Each department is responsible for identifying relevant performance data to allow for an
independent analysis of specific service outcomes. Data is reviewed to provide the council and
public with a better understanding of the operational demands, resource inputs, and
performance outcomes associated with a specific service delivery system. These performance
measures continue to be examined and refined to ensure the data presented is useful and
relevant.
6.The aggressive and appropriate investment of idle city funds to maximize the generation
of interest income, while ensuring adequate cash flow requirements.
Investment of city funds is controlled by state statute and managed by the Finance
Director. Idle funds are invested in a variety of financial instruments such as certificates of
deposit, federal agencies, and appropriately rated bonds. Long-term investing is designed to
achieve the best yield in the current market, following a strategy that structures long-term
investments in ladder format and reinvests short-term investment in rotating terms. While
volatility from year to year is seen as interest rates fluctuate and market values of investments
held change, investing brings solid returns in the long run.
7.Greater reliance on technology to enhance employee productivity in all areas of city
operations and improve customer communications.
The city has taken steps to invest additional time and energy on labor-saving technology,
such as software programming and electronic file storage. Imaging city records enables the city
to reduce storage areas presently dedicated to paper files and look at more economical and
efficient systems of data retrieval.
8.Involving all employees in the process of re-engineering the work environment by
encouraging cross-training opportunities, reducing and eliminating bureaucratic barriers,
streamlining public process requirements, prioritizing transparency with the public, and
adopting private sector customer service business values in city operations.
City staff is encouraged to identify work practice issues that are inefficient or overly
bureaucratic. The management team is committed to involving their employees and fostering
an environment that challenges the status quo of city operations.
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9.Continuously reviewing opportunities to form partnerships with other community
stakeholders and neighboring communities to share services and equipment, jointly contract
with vendors and purchase equipment, and develop strategies to deal with local issues using
a regional approach.
The city has established several equipment and service delivery sharing arrangements
with other community stakeholders and neighboring communities and has joint powers
agreements in place on a variety of local and regional issues in planning, public safety and
public works initiatives.
Recent steps taken to achieve long-term fiscal objectives:
The city has shifted its focus from issuing debt for all street projects in the Pavement
Preservation Program to funding those projects on a pay-as-you-go basis due to the relatively
routine nature of road improvements in the city. The debt level and debt levy capacities are
reserved for major projects that are truly unique such as the Bertram Chain of Lakes Regional
Park, Public Works Facility construction, and The Pointes at Cedar development area.
In 2021, the city created the Facilities Maintenance internal service fund. This allows costs for
city facility repairs and maintenance to be viewed across the board while also seeing each
department’s impact through the internal charges paid by each cost center. A new software
program, Cartegraph, was implemented to track work orders to provide the breakdown of costs
to each facility and department.
Also in 2021, the city prioritized investing in its Information Technology (IT) infrastructure by
hiring an internal IT Technician. This allowed for the transition from a break-fix strategy to a
purposeful, proactive strategy in dealing with the increasing use of software and ever
heightened cybersecurity threats.
In 2022, the city completed a long-term financial planning model. This was a city initiative for
many years and was finally accomplished through the use of Community Energy Transition
(CET) grant funds from the Minnesota Department of Employment and Economic Development
(DEED).
In 2023, the city increased its applications for external funding. Most notably, the city was
awarded $11 million from the State of Minnesota towards the cost of constructing a new water
treatment facility. Other funding was secured for capital projects like constructing roundabouts
at two major intersections on School Boulevard (Cedar Street and Edmonson Avenue), but also
operating initiatives like combating Emerald Ash Borer in our community.
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CAPITAL EXPENDITURES & CAPITAL IMPROVEMENT PLAN
INTRODUCTION
Capital expenditures (also called capital outlays) are the purchases of capital assets, which are
used in operations and have initial useful lives extending beyond a single reporting period.
These assets must also meet capitalization thresholds (see Appendix), which vary by asset
classification and typically costs more than $10,000.
Capital expenditures can be classified as either recurring or non-recurring. Large projects
adding to or replacing infrastructure are usually non-recurring in nature. Pedestrian and
roadway improvements in the downtown design and construction of a new Public Works
Facility and Water Treatment Facility, and the School Boulevard Roundabout & Reconstruction
improvements projects account for the bulk of the 2024 non-recurring projects. Large non-
recurring projects are typically financed by debt, intergovernmental revenue (state/federal
grants and aids) and draws on reserves accumulated in anticipation of the project.
The capital improvements presented in this section comprise the 2024-2028 Capital
Improvements Plan (CIP). The Monticello CIP identifies capital and select major noncapital
expenditures in a comprehensive plan to forecast future resources needed to acquire or build
assets used in municipal operations. By integrating major noncapital expenditures, such as
maintenance items or asset purchases not meeting specific dollar thresholds, the city can better
plan and prepare for future financial challenges. However, the creation of a long-term financial
plan has allowed for some expenditures of this nature to be removed from the CIP.
WHAT IS A CAPITAL IMPROVEMENT PLAN?
A capital improvement plan is a five-year projection for the evaluation of the city's capital
needs. It serves as a guide for construction, development, and maintenance of the city's
infrastructure assets, as well as other less expensive assets, in the most cost-efficient manner
possible. It is the result of systematic review of each project, as it relates to the city council
goals and the established priority scheme, to maximize the use of all financial resources. The
Monticello CIP has four expenditure categories: capital improvements, vehicles and major
equipment, major repair and maintenance items, and small tools and equipment. Capital asset
classes also include land acquisitions.
While the plan serves as a long-range plan, it is reviewed annually and revised based on current
circumstances and opportunities. Priorities may change due to grant opportunities or
circumstances that caused a more rapid deterioration of an asset. Projects may be revised for
significant cost variances. The council holds an annual goal setting workshop that ensures these
projects and purchases continue to align with the long-term vision.
WHAT ARE THE OBJECTIVES OF A CAPITAL IMPROVEMENT PLAN?
· To forecast public facilities and improvements in a timely and systematic manner while
providing an opportunity for residents and interest groups to provide input.
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· To strike a balance between needed public improvements and the present financial capability
of the city to provide for these improvements.
· To anticipate and project financing needs to maximize available federal, state, and county
funds, and enhance and protect future bonding capacity and ratings.
· To implement city council objectives as outlined in the “Purpose and Mission” and serve as a
guide for local officials in making budgetary decisions.
· To promote and enhance the economic development of the city of Monticello while balancing
the needs of new development with existing development.
The CIP is developed with the intent of improving the reliability of cost estimates and funding
forecasts by focusing on five years rather than only the upcoming year. This will enable decision
makers to identify opportunity costs of shifting priorities. It creates a better understanding of
the balancing act that is required to allocate scarce resources to capital improvement efforts.
WHAT IS THE CAPITAL IMPROVEMENT PLAN DEVELOPMENT PROCESS?
Assign Project Titles
Make the title descriptive of the nature and scope work.
Group projects in a meaningful way by department. A project title of ABC Improvements will
not work if it includes everything from the kitchen sink replacement to the pathway overlay.
Formulate Project Descriptions
Include the target activities to be completed each year on the project. This is a brief statement
of the work that will be performed and its location.
Formulate Project Cost Estimates
The costs of each project are broken down into any of the following categories:
Land Acquisition
Planning/Design/Construction
Vehicles/Equipment/Furnishing
Assign Priorities
Priorities: required on all projects based on the following categories:
Priority I: Imperative (MUST-DO) - Projects that cannot reasonably be postponed to avoid
harmful or otherwise undesirable consequences.
1.Corrects a condition dangerous to public health or safety
2.Satisfies a legal obligation (law, regulation, court order, contract)
3.Alleviates an emergency service disruption or deficiency
4.Prevents irreparable damage to a valuable public facility
Priority II: Essential (SHOULD-DO) - Projects that address clearly demonstrated needs or
objectives.
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5.Rehabilitates or replaces an obsolete public facility or attachment thereto
6.Stimulates economic growth and private capital investment
7.Reduces future operating and maintenance costs
8.Leverages available State or Federal funding
Priority III: Important (COULD-DO) - Projects that benefit the community but may be delayed
without detrimental effects to basic services.
9.Provides a new or expanded level of service
10.Promotes intergovernmental cooperation
11.Reduces energy consumption
12.Enhances cultural or natural resources
Document Project Justifications
The following things are considered:
· Reason the project is necessary
· Related projects (timing issues)
· Coordination efforts required with other agencies (timing issues)
· Mandates and deadlines for compliance (timing issues)
· Service impact (number of participants impacted)
· New fees that could be generated because of the project (funding/cost recovery)
· Community goal references (refer to Strategic Goals & Strategies section)
· Safety requirements
Document Operating Impact
This is a required field; projects are not accepted without it. Record the costs in the year they
will initially occur. It will be assumed that the costs continue from that point on unless
information is provided otherwise. The following possibilities exist:
· Maintenance project that doesn’t require any more than is already in the budget for
maintenance.
· Maintenance project that replaces existing items with a more cost-effective material or
device that would result in a slight savings in operating dollars. Examples: more energy
efficient heating, ventilation, and air conditioning (HVAC) unit resulting in an electricity
savings.
· New project will always have an operating impact.
Note Unfunded Projects
· All projects not funded are placed on an unfunded list.
Present product to the city council for review and final consideration
· Five-year funded capital improvements
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· Ranked list of unfunded needs
HOW DOES THE CAPITAL IMPROVEMENT PLAN IMPACT THE OPERATING BUDGET?
All capital improvement projects are required to show the operating budget impact at the time
the projects are submitted for consideration in the Capital Improvement Plan. This includes the
number of full-time equivalent positions that would be needed or could be eliminated and the
cost or savings for salaries/benefits, supplies/services, and equipment. It would not be prudent
to make funding decisions in favor of a project the city could not afford to maintain, staff, or
provide equipment for.
Capital improvements can impact the budget by increasing or decreasing revenues and
expenditures, for example by attracting new businesses; by requiring new employees or
additional maintenance or utility costs; or by reducing maintenance costs, utility costs, or
personnel costs (reduction in overtime or man-hours). Specifically, new equipment may be
more productive and less expensive to operate.
Many projects are associated with prevention of future excessive costs that are difficult to
measure. The cost of the maintenance should not exceed the benefit of the asset. The projects
may have maintenance costs, but the existing maintenance budgets are sufficient. The priority
for available capital project funds has been maintenance of existing facilities and infrastructure.
Many of Monticello’s projects fall into this category.
One capital asset that requires a delicate balance of operating maintenance and capital
replacement is the city’s more than 80-mile street system. For more durable mill and overlay,
the city budgets every other year for chip sealing and each year for crack sealing. These
operating and capital expenditures work together to prevent more expensive street
reconstruction projects.
Finally, the city annually budgets for replacement of water and sewer mains through each
respective enterprise fund. For public utilities, customer satisfaction is difficult to quantify in
dollars. However, a generally satisfied customer may be less likely to complain about the rate
increases needed to support those services.
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In the table above, items with an increase in operating costs are additional equipment or new
projects/improvements. Items with a decrease in operating costs are replacement equipment
with lower R&M in the near term. Items with both increases and decreases to operating costs
are noted with (+) and (-) in the Comment column. R&M expenses for roads include estimates
for snow removal, boulevard maintenance, street sweeping, crack sealing, and striping. Listed
Investment
Department - Operating Fund Amount Starting Year Amount Comment
Public Works - General Fund
Two-Ton Pickup with Hoist and Dump Box 95,000$ 2024 11,350$ CE lease (+) and R&M (-)
Tack Trailer - 250 gallon 40,000$ 2024 4,800$ CE lease (+) and R&M (-)
40" Cold Planer 32,000$ 2024 3,780$ CE lease (+) and R&M (-)
School Boulevard Improvements & Roundabouts 2,495,000$ 2025 (24,950)$ R&M
Broadway East Improvements 3,400,000$ 2025 (34,000)$ R&M
Downtown Roadway & Pedestrian Improvements 5,650,000$ 2024 7,625$ Utilities (+) and R&M (-)
New Public Works Facility 30,000,000$ 2026 (59,000)$ Utilities (+) and R&M (-)
CSAH 39 Pedestrian Pathway Improvements 285,000$ 2026 2,200$ R&M
Sidewalk Gap & Pavement Preservation 400,000$ 2025 900$ R&M
West 7th Street Retaining Wall 750,000$ N/A -$ No routine R&M
Recreation & Culture - General Fund
One-Ton Pickup 90,000$ 2024 10,800$ CE lease (+) and R&M (-)
Kifco Water Wheel 20,000$ 2024 3,300$ CE lease (+) and R&M (-)
Walk-Behind Mower 15,000$ 2024 2,450$ CE lease (+) and R&M (-)
Great River Regional Trail Improvements 75,000$ 2026 3,400$ R&M
Bike Route Map 12,000$ N/A -$ No routine R&M
Parks Shop Facility Repairs 15,000$ 2025 (250)$ R&M
Library Carpet Replacement 40,000$ N/A -$ No routine R&M
Recreation - Community Center
MCC Pavement & Sidewalk Improvements 70,000$ 2025 (500)$ R&M
Climbing Wall Resurface 35,000$ N/A -$ No routine R&M
Countertop Replacements 25,000$ N/A -$ No routine R&M
Mississippi Room Dais Improvements 20,000$ N/A -$ No routine R&M
Public Works - Water Fund
Water Treatment Facility 1,000,000$ 2027 222,000$ Staffing & operations
Portable Generator 150,000$ 2025 250$ R&M
Well Pump House Repairs 20,000$ 2025 (200)$ R&M
Public Works - Sewer Fund
WWTP Gasifier Tank 700,000$ 2025 (7,000)$ R&M
Public Works - Stormwater Fund
Chelsea Road Outlet Control 40,000$ 2025 1,000$ R&M
Ditch 33 Upgrades 1,975,000$ 2025 9,875$ R&M
Deputy Registrar Fund
Parking Lot Improvements 90,000$ 2025 (2,250)$ R&M
Fire Alarm System Upgrades 20,000$ N/A -$ No routine R&M
Fiber Optics Fund
Expansion to New Neighborhoods 200,000$ 2025 2,000$ R&M
Impact on
Operating Expense
96Table of Contents
amounts are for expenses more than those already being incurred. With no impact on
expenditures, some are replaced due to obsolescence or aesthetics. The amounts listed are
estimates; many of these amounts may or may not be close to those actually incurred.
HOW IS INPUT FROM RESIDENTS INCORPORATED IN THE CIP DEVELOPMENT PROCESS?
Residents are involved in the capital improvements plan through participation at council
meetings, participation in work sessions and public hearings, and through boards and
commissions. Beyond participation in boards and public meetings, the city makes a
considerable effort to inform the citizens through various publications, news releases, and the
website along with holding public input meetings for major projects and setting up booths at
various city events to garner feedback from residents and routine community visitors.
HOW IS THE CAPITAL IMPROVEMENT PLAN FINANCED?
In analyzing the financial viability of the capital improvements in the 2024-2028 CIP, the city has
three basic choices for methods of financing: pay-as-you-go, joint power agreement
development authority capital leasing, and debt financing. The following sources provide
revenue for the three financing methods:
General Fund revenues, such as property taxes, local government aid (not applicable to
the City of Monticello), and service charges are current revenues used to finance
relatively small capital outlays.
The Central Equipment Fund, created for the purpose of establishing a revolving fund
for future equipment purchases, reduces the impact of large equipment purchases on
annual budget unit expenditures. This fund purchases equipment and leases it back to
the benefiting budget units. The lease payments assure that equipment purchases will
receive annual funding and are set at rates to recover depreciation plus inflation, but
not operating costs such as repairs and maintenance (R&M), gas, or insurance. Similarly,
internal service funds have been established for Facilities Maintenance and IT Services,
which will also include equipment purchases related to each respective fund.
Enterprise fund revenues, derived from user charges, are used to finance capital
improvements and equipment necessary for delivering a specific service. Additionally,
accumulated revenues in enterprise funds can be transferred to other funds, specifically
the Capital Projects Fund, to provide financing for capital asset acquisitions.
Federal and state grants provide funding for various capital improvement projects.
Other sources include local grants, donations, reserves, and other governmental units.
Debt issuance is used to finance large, non-recurring capital improvements. General
obligation improvement bonds and general obligation revenue bonds are used to
finance improvements to the city’s infrastructure. Many of the items identifying the
Capital Project Fund as funding source will need some level of debt issuance.
97Table of Contents
The below graphs provide a breakdown of expenditures and funding sources within the CIP:
The large increase of capital activity in 2024 is attributable to the following projects:
Completion of the Downtown Pedestrian & Roadway, Public Works Facility, Water Treatment
Facility design, Broadway East Transportation Improvements, the School Boulevard
Roundabout and Reconstruction Improvements, and the Ditch 33 Improvements.
2025’s capital activity portrays additional work on the Public Works Facility and Water
Treatment Plant, West Bridge Park Improvements, the Pointes at Cedar recreation and
development areas along with trail and pathway improvements, improvements to water trunk
lines, and upgrades to the wastewater treatment plant.
2026 capital outlays consist of additional investments in the Pointes at Cedar, Water Treatment
Plant, and Bertram Chain of Lakes projects.
Notable capital expenditures in 2027 include street and utility improvements, including deep
water and sewer trunk lines, on Fallon Avenue from Chelsea Road to School Boulevard. In
addition, a subsequent phase of upgrades at the Bertram Chain of Lakes Regional Athletic Park.
2028 expenditures are related to additional improvements in the Pointes at Cedar recreation
and development area and to water line infrastructure.
$-
$10
$20
$30
$40
$50
$60
2021
Actual
2022
Actual
2023
Projected
2024
Budgeted
2025
Budgeted
2026
Budgeted
2027
Budgeted
2028
BudgetedMillionsCIP -Expenditures for FY 2021 -2028
Buildings Infrastructure - Streets Infrastructure - Utilities Improvements - Parks Vehicles & Equipment Land
$-
$10
$20
$30
$40
$50
$60
2021
Actual
2022
Actual
2023
Projected
2024
Budgeted
2025
Budgeted
2026
Budgeted
2027
Budgeted
2028
BudgetedMillionsCIP -Funding Sources for FY 2021 -2028
Capital Projects Fund Central Equipment Fund Enterprise Funds Bond Proceeds External Grant Funding Other Funds
98Table of Contents
Capital Improvement Plan
City of Monticello, Minnesota
FUNDING SOURCE SUMMARY
2024 thru 2028
TotalSource2024 2025 2026 2027 2028
5,337,000292,000 1,466,000 584,000 2,696,000 299,000
44,398,95411,750,000 7,842,000 6,630,000 12,076,954 6,100,000
1,001,000164,000 249,000 264,000 324,000
52,000,00031,000,000 13,000,000 8,000,000
170,000110,000 15,000 15,000 15,000 15,000
1,041,592200,000 210,398 210,398 210,398 210,398
947,96455,000 223,241 223,241 223,241 223,241
219,500125,000 31,500 31,500 31,500
10,045,00087,000 4,525,000 5,250,000 50,000 133,000
1,476,230700,000 544,196 182,029 50,005
11,254,0614,750,000 875,008 5,019,027 610,026
11,000,0006,000,000 5,000,000
5,294,0002,015,000 1,180,000 1,490,000 609,000
1,615,0001,380,000 235,000
2,120,000170,000 570,000 460,000 460,000 460,000
Capital Equipment Fund
Capital Project Fund
Community Center Fund
Debt Proceeds
DMV Fund
Fibernet Fund
General Fund
Municipal Liquor Fund
Parks & Pathways Fund
Sewer Fund
Sewer Trunk Fund
State of MN Grant Funding
Stormwater Trunk Fund
Street Lighting Fund
Water Fund
Water Trunk Fund 11,332,9931,936,540 3,803,636 3,148,889 2,443,928
47,759,000 42,786,375 33,003,812 24,804,009 10,900,098 159,253,294GRAND TOTAL
Produced Using the Plan-It Capital Planning Software
99Table of Contents
Capital Improvement Plan
City of Monticello, Minnesota
PROJECTS BY FUNDING SOURCE AND DEPARTMENT
2024 2028thru
TotalSource Project # Priority 2024 2025 2026 2027 2028
Capital Equipment Fund
Fire & Rescue
VEQ-18-006 200,000200,000Utility 11 - Replacement 1
VEQ-21-002 450,000450,000Tender 11 - Replacement 1
VEQ-21-003 225,000225,000Utility 12 - Replacement 1
875,000200,000 450,000 225,000Fire & Rescue Total
Public Works
CEF-24-001 95,00095,000Two-Ton Pickup w/ Hoist and Dump Box (Streets) 2
CEF-24-002 32,00032,00040in Cold Planer (Streets)2
CEF-25-001 95,00095,000Two-Ton Pickup (Streets)2
VEQ-21-997 1,800,000420,000 14,000 1,332,000 34,000Fleet Replacement - PW 3
VEQ-24-001 40,00040,000Tack Wagon (Streets)2
2,062,000167,000 515,000 14,000 1,332,000 34,000Public Works Total
Recreation & Culture
CEF-24-003 15,00015,000Walk-Behind Mower (Parks) 2
CEF-24-004 20,00020,000Kifco Water Wheel (Parks)2
CEF-24-005 15,00015,000Line Painter (Parks)2
VEQ-21-998 2,260,000736,000 120,000 1,364,000 40,000Fleet Replacement - Parks 3
VEQ-24-005 90,00090,000One-Ton Pickup 2
2,400,000125,000 751,000 120,000 1,364,000 40,000Recreation & Culture Total
5,337,000292,000 1,466,000 584,000 2,696,000 299,000Capital Equipment Fund Total
Capital Project Fund
Community Center
MCC-13-001 40,00040,000Movable Walls 3
MCC-13-003 20,00020,000Mississippi Room Dais Top 3
MCC-13-004 125,00025,000 100,000Guest Svc/Childcar/Resroom Counter Replacements 3
MCC-18-001 250,000250,000Update Old Skate Park 2
MCC-23-001 535,00070,000 465,000MCC Pavement & Sidewalk Improvements 2
MCC-24-002 77,00077,000Gym Panel 3
MCC-24-003 100,000100,000Locker Room Redesign 3
MNC-13-006 40,00040,000Carpet and Terrazo Replace/Repair 2
MNC-19-001 35,00035,000Climbing Wall Resurfacing 2
1,222,000150,000 782,000 40,000 250,000Community Center Total
Downtown
DTN-24-002 3,020,0003,020,000Broadway East Improvements 3
STR-19-004 25,00025,000Broadway Corridor Parklets 3
STR-21-001 4,650,0004,650,000Broadway Sidewalk & Landscaping Improvements 3
7,695,0007,670,000 25,000Downtown Total
Fallon Avenue Improvements
STR-17-002 2,026,954100,000 1,776,954 150,000Fallon Avenue & Trail - Chelsea to School Bvld 3
STR-20-003 500,00050,000 450,000School Blvd/Fallon Roundabout 3
Produced Using the Plan-It Capital Planning Software
100Table of Contents
TotalSource Project # Priority 2024 2025 2026 2027 2028
2,526,954150,000 2,226,954 150,000Fallon Avenue Improvements Total
Pointes at Cedar
STR-19-005 50,00050,000Chelsea/Cedar Roundabout 3
STR-23-005 1,585,0001,585,000School/Cedar & Edmonson Roundabouts 1
SWD-22-013 17,010,000510,000 5,500,000 5,500,000 5,500,000The Pointes at Cedar Pond n/a
18,645,0001,585,000 510,000 5,500,000 5,500,000 5,550,000Pointes at Cedar Total
Streets
STR-15-004 500,000100,000 100,000 100,000 100,000 100,000Sidewalk Gap Improvement Project (TBD) 2
STR-19-001 4,750,000300,000 2,450,000 200,000 1,500,000 300,000Pavement Management Program 1
STR-20-007 2,500,0002,500,00090th St Reconstruction - Chelsea to City Limits 2
STR-20-008 840,000200,000 640,000School Blvd Extension - Redford Ln to 90th St 3
STR-22-009 1,000,0001,000,000Dalton Way Extension and Industrial Park Grading 2
STR-23-002 750,000750,000West 7th Street Retaining Wall 1
STR-23-003 60,00060,000River Terrace Secondary Access Culvert Replacement 1
STR-23-004 1,500,000285,000 1,215,000CSAH 39 Pedestrian Improvements - Elm to Chelsea 2
STR-24-001 910,000910,000School Blvd Reconstruction - TH25 to Country Ln 2
STR-24-002 1,500,0001,500,000CSAH 39/Chelsea Roundabout 2
14,310,0002,345,000 6,525,000 940,000 4,100,000 400,000Streets Total
44,398,95411,750,000 7,842,000 6,630,000 12,076,954 6,100,000Capital Project Fund Total
Community Center Fund
Community Center
MCC-24-001 10,00010,000Bridge Room Storage 3
STE-13-013 120,00060,000 60,000Recreation Equipment 2
STE-18-005 15,00015,000Floor Scrubber 2
145,00060,000 25,000 60,000Community Center Total
Facilities Maintenance
FAM-99-991 856,000104,000 224,000 264,000 264,000Facility Repairs - MCC 2
856,000104,000 224,000 264,000 264,000Facilities Maintenance Total
1,001,000164,000 249,000 264,000 324,000Community Center Fund Total
Debt Proceeds
Public Works
PWK-13-001 35,000,00030,000,000 5,000,000Public Works Facility 3
35,000,00030,000,000 5,000,000Public Works Total
Utility - Water
UTW-13-002 17,000,0001,000,000 8,000,000 8,000,000Water Treatment Facility 1
17,000,0001,000,000 8,000,000 8,000,000Utility - Water Total
52,000,00031,000,000 13,000,000 8,000,000Debt Proceeds Total
DMV Fund
DMV - Deputy Registrar
DMV-23-001 90,00090,000DMV Parking Lot Improvements 2
90,00090,000DMV - Deputy Registrar Total
Facilities Maintenance
DMV-24-001 20,00020,000DMV Fire Alarm System 1
FAM-99-994 60,00015,000 15,000 15,000 15,000Facility Repairs - DMV Building 2
80,00020,000 15,000 15,000 15,000 15,000Facilities Maintenance Total
Produced Using the Plan-It Capital Planning Software
101Table of Contents
TotalSource Project # Priority 2024 2025 2026 2027 2028
170,000110,000 15,000 15,000 15,000 15,000DMV Fund Total
Fibernet Fund
Facilities Maintenance
FAM-99-997 41,59210,398 10,398 10,398 10,398Facility Repairs - Head End 2
41,59210,398 10,398 10,398 10,398Facilities Maintenance Total
Fibernet
FNM-22-045 1,000,000200,000 200,000 200,000 200,000 200,000Capital Expansion 2
1,000,000200,000 200,000 200,000 200,000 200,000Fibernet Total
1,041,592200,000 210,398 210,398 210,398 210,398Fibernet Fund Total
General Fund
Facilities Maintenance
FAM-22-041 40,00040,000Carpet - Library 2
FAM-99-993 112,00028,000 28,000 28,000 28,000Facility Repairs - Library 2
FAM-99-995 420,000105,000 105,000 105,000 105,000Facility Repairs - PW Building 2
FAM-99-996 115,00015,000 25,000 25,000 25,000 25,000Facility Repairs - Parks Shop 2
FAM-99-998 14,8323,708 3,708 3,708 3,708Facility Repairs - Animal Shelter 2
FAM-99-999 246,13261,533 61,533 61,533 61,533Facility Repairs - Fire Station 2
947,96455,000 223,241 223,241 223,241 223,241Facilities Maintenance Total
947,96455,000 223,241 223,241 223,241 223,241General Fund Total
Municipal Liquor Fund
Facilities Maintenance
FAM-99-992 144,50050,000 31,500 31,500 31,500Facility Repairs - Liquor Store 2
144,50050,000 31,500 31,500 31,500Facilities Maintenance Total
Municipal Liquor
LIQ-13-002 75,00075,000Parking Lot Improvements 1
75,00075,000Municipal Liquor Total
219,500125,000 31,500 31,500 31,500Municipal Liquor Fund Total
Parks & Pathways Fund
Downtown
PAR-15-005 1,500,0001,500,000West Bridge Park Improvements 3
1,500,0001,500,000Downtown Total
Recreation & Culture
MNC-22-016 12,00012,000Bike Route Map 2
PAR-13-012 4,700,000200,000 4,500,000BCOL Ball Fields 3
PAR-17-004 100,000100,000Pioneer Park Playground Structure 3
PAR-17-007 30,00030,000Front Street Pier 3
PAR-20-003 200,000200,000Briarwood Trail Connection 3
PAR-20-004 250,000250,000BCOL Road Improvements 2
PAR-20-006 775,000775,0004th St Park Improvements 2
PAR-20-007 200,000200,000Ellison Playground Equipment 3
PAR-21-002 100,000100,000River Mill Park Sidewalk/Parking 3
PAR-21-005 150,00050,000 50,000 50,000Welcome Sign for Monticello 3
PAR-21-006 70,00070,000Columbarium-Riverside Cemetery 3
PAR-21-008 1,075,00075,000 500,000 500,000Great River Regional Trail 3
PAR-22-015 600,000600,000BCOL County/City Maintenance Facility n/a
Produced Using the Plan-It Capital Planning Software
102Table of Contents
TotalSource Project # Priority 2024 2025 2026 2027 2028
PAR-23-001 250,000250,000Pickleball Court 3
STE-18-002 33,00033,000Boarding Dock for Ellison 3
8,545,00087,000 3,025,000 5,250,000 50,000 133,000Recreation & Culture Total
10,045,00087,000 4,525,000 5,250,000 50,000 133,000Parks & Pathways Fund Total
Sewer Fund
Facilities Maintenance
FAM-23-005 16,00016,000WWTP Comp Bldg Lower Roof Replacement 2
FAM-23-006 46,00046,000WWTP Digester Bldg Roof Replacement 2
FAM-23-007 30,00030,000WWTP Garage Roof Replacement 2
FAM-23-008 26,00026,000WWTP Influent Bldg Roof Replacement 2
118,000118,000Facilities Maintenance Total
Utility - Sewer
MNC-17-005 110,000110,000Demo Obsolete WWTP Equipment 3
SEW-24-003 700,000700,000WWTP Gasifier Tank 1
VEQ-21-999 548,230316,196 182,029 50,005Fleet Replacement - Sewage 2
1,358,230700,000 426,196 182,029 50,005Utility - Sewer Total
1,476,230700,000 544,196 182,029 50,005Sewer Fund Total
Sewer Trunk Fund
Fallon Avenue Improvements
UTS-17-002 3,226,769300,000 2,926,769Fallon Avenue Trunk Line Extension - Sewer 3
3,226,769300,000 2,926,769Fallon Avenue Improvements Total
Utility - Sewer
SEW-24-001 500,000500,000East CSAH 39 Utility Extension 2
SEW-24-002 2,500,0001,000,000 1,500,000West CSAH 39 Utility Extension 3
UTS-13-001 1,777,292575,008 592,258 610,026Annual Sewer Trunk Improvements 1
UTS-13-002 750,000750,000Liftstation - Marvin Road 3
UTS-13-003 2,500,0002,500,000WWTP Influent Lift Station and Grit Removal 1
8,027,2924,750,000 575,008 2,092,258 610,026Utility - Sewer Total
11,254,0614,750,000 875,008 5,019,027 610,026Sewer Trunk Fund Total
State of MN Grant Funding
Utility - Water
UTW-13-002 11,000,0006,000,000 5,000,000Water Treatment Facility 1
11,000,0006,000,000 5,000,000Utility - Water Total
11,000,0006,000,000 5,000,000State of MN Grant Funding Total
Stormwater Trunk Fund
Fallon Avenue Improvements
SWD-17-001 1,059,000450,000 609,000Chelsea/Fallon Avenue Pond Expansion 3
1,059,000450,000 609,000Fallon Avenue Improvements Total
Stormwater\Drainage
SWD-13-002 1,060,0001,060,000Stormwater Liftstation (TH 25 Pond) 1
SWD-20-001 480,000480,000Otter Creek - Pond A Construction 3
SWD-20-002 560,000560,000Otter Creek - Pond D Construction 3
SWD-20-003 120,000120,000Otter Creek - Karlsburger Pond Outlet 2
SWD-20-005 40,00040,000Chelsea Road Outlet Control - HB07 2
SWD-22-014 1,975,0001,975,000Ditch 33 Upgrades 2
Produced Using the Plan-It Capital Planning Software
103Table of Contents
TotalSource Project # Priority 2024 2025 2026 2027 2028
4,235,0002,015,000 1,180,000 1,040,000Stormwater\Drainage Total
5,294,0002,015,000 1,180,000 1,490,000 609,000Stormwater Trunk Fund Total
Street Lighting Fund
Downtown
DTN-24-003 380,000380,000Broadway East Lighting 3
PAR-13-014 60,00060,000CSAH 75 Pathway Lighting 3
STR-23-006 1,000,0001,000,000Block 52 Utility Relocates 2
1,440,0001,380,000 60,000Downtown Total
Recreation & Culture
PAR-15-004 175,000175,000Fenning Avenue Pathway Lighting 3
175,000175,000Recreation & Culture Total
1,615,0001,380,000 235,000Street Lighting Fund Total
Water Fund
Utility - Water
MNC-23-001 20,00020,000Well Repairs 2
UTW-13-005 110,000110,000Booster Station Upgrade 3
UTW-22-033 1,840,000460,000 460,000 460,000 460,000Cast Iron Watermain Replacement 2
WAT-24-002 150,000150,000Portable Generator 3
2,120,000170,000 570,000 460,000 460,000 460,000Utility - Water Total
2,120,000170,000 570,000 460,000 460,000 460,000Water Fund Total
Water Trunk Fund
Fallon Avenue Improvements
UTW-17-002 1,076,144300,000 776,144Fallon Avenue Trunk Line Improvements - Water 3
1,076,144300,000 776,144Fallon Avenue Improvements Total
Utility - Water
UTW-13-001 6,556,849936,540 2,303,636 872,745 2,443,928Trunk Water System Improvements 1
UTW-13-003 1,200,0001,200,000Well #6 1
WAT-24-001 2,500,0001,000,000 1,500,000West CSAH 39 Utility Extension 3
10,256,8491,936,540 3,503,636 2,372,745 2,443,928Utility - Water Total
11,332,9931,936,540 3,803,636 3,148,889 2,443,928Water Trunk Fund Total
159,253,29447,759,000 42,786,375 33,003,812 24,804,009 10,900,098GRAND TOTAL
Produced Using the Plan-It Capital Planning Software
104Table of Contents
DEBT
Debt is carried in three fund types: Governmental Funds, Enterprise Funds, and Internal Service
Funds. Consequently, debt has a different impact on the operations of each fund type.
However, debt service is a fixed cost that does not vary with activity levels. Debt amortization
and redemption reduces fixed costs, freeing resources for other purposes.
Governmental Funds
Governmental fund debt service is provided through debt service funds, which accumulate
money from various sources for principal and interest payments. Those sources can include
property taxes, special assessments, and transfers from enterprise funds collecting
development fees. The debt effect on services delivered through governmental funds with
current plant and equipment is somewhat diminished because the city is not constrained by
state-imposed levy limits for property taxes. When levy limits have been in place, statutes have
allowed for special levies for debt service. While there are limits to what taxpayers can bear,
Monticello has one of the lowest tax capacity rates in Wright County because of its large
commercial tax base—including the Xcel Energy nuclear power plant. In a stable market value
environment, the power plant absorbs roughly half of any tax increase. The General Fund is
primarily supported (roughly 68%) by property taxes and the Monticello Community Center
(MCC) Fund is primarily supported by charges for services and supplemented by a property tax
levy and transfer from the Deputy Registrar Fund. High debt levels lower the city’s ability to
issue new debt for capital assets, which may improve efficiency or meet a growing need.
Enterprise Funds
The Sewer Fund is the only enterprise fund with debt, the 2013B General Obligation (G.O.)
revenue bonds, and a 2015 Public Facilities Authority (PFA) G.O. Sewer Revenue Note. All utility
rates are reviewed annually and adjusted to cover operating, capital, and debt service
expenses. According to a survey by engineering firm AE2S, Monticello has some of the lowest
utility rates in Minnesota. However, the council is aware that the city needs to maintain its
competitive position with taxes and utility charges to attract economic development.
Internal Service Funds
One outstanding debt issue (2014A) provided financing for creating a Central Equipment
internal service fund. This fund finances governmental fund equipment purchases over
$10,000. The equipment is then leased back to the benefitting budget unit for a fixed duration.
The lease payments provide for additional future equipment purchases. Currently, the General
Fund is the only governmental fund internally leasing equipment. The debt serves as a
mechanism for maintaining the fund and its equipment purchases. With about 68% of the
General Fund revenue comprised of property taxes, the Central Equipment Fund debt and the
related lease payments have a direct effect on the resources available for other uses.
In summary, debt is a valid way to match customers with the cost of providing a particular
service. Current service customers pay for current service delivery with annual debt service
payments supported by user fees and taxes. Future service customers make future debt service
payments through future taxes and user fees.
105Table of Contents
Anticipated Borrowing this Fiscal Year
The City of Monticello anticipates issuing $30 million of G.O. Capital Improvement Plan (CIP)
Bonds in 2024 for construction of a new Public Works facility. Because interest rates and
maturities are not yet known, no payment schedules for 2024A bonds (which will begin in 2025)
are included in this budget document.
Impacts to Operations
The city’s percentage of levy used for debt service payments has decreased from 28% in 2014
to 15% in 2023, with the portion of the levy used for pay-as-you-go capital increasing from none
to 14%. Should the city proceed with issuing debt for construction of a new Public Works
Facility, the portion of the levy used for debt would be projected to increase to 27%. While not
unprecedented, city council is aware of the fact that issuing that level of debt would create
pressure on other areas of the levy, including to other capital projects and well as operations
(i.e. maintaining existing assets and offering the current level of services).
Bond Rating
The city’s G.O. bond rating was reviewed in October 2023. Moody’s upgraded the city’s prior
G.O. bond rating of A1 to Aa3, which can be described as “high grade”.
Legal Debt Limit
Most Minnesota cities may not incur debt more than three percent of the market value of
taxable property in the city. Excepted from this overall three percent limit are almost all debt
obligations for which some other source of revenue is pledged as security. The result is that,
with only a few exceptions, the only obligations subject to the debt limit are general obligation
(G.O.) bonds payable solely from ad valorem property taxes. The legal debt limit has nothing to
do with the practical debt limit of a city, which is the debt burden beyond which the
creditworthiness of the city is put into question. (See Minnesota Statutes, Section 475.53)
Moody's S&P Fitch
Aaa AAA AAA Prime
Aa1 AA+AA+
Aa2 AA AA
Aa3 AA-AA-
A1 A+A+
A2 A A
A3 A-A-
Baa1 BBB+BBB+
Baa2 BBB BBB
Baa3 BBB-BBB-
High grade
Upper medium
grade
Lower medium
grade
Market value (payable 2023)*2,466,129,200$
Debt limit (3% of market value)73,983,876$
Total net debt applicable to limit (6,280,000)$
Legal debt margin 67,703,876$
*Final Payable 2024 not yet available.
Legal Debt Margin Calculation for Fiscal Year 2024
106Table of Contents
G.O. Debt Service Levies: Most city debt issues are supported on some level by property taxes.
Annual debt service levies are as follows:
G.O. Debt Service Payments: Annual debt service payments are as follows:
G.O. Debt Outstanding as of 12/31: Projected balances of outstanding debt are as follows:
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
202420252026202720282029203020312032203320342035G.O. Debt Service Levies
2015B 2016A 2017A 2018A 2019A 2020A
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
202420252026202720282029203020312032203320342035G.O. Debt Service Payments
2013B 2014A 2015B 2016A 2017A 2018A 2019A 2020A
$-
$2
$4
$6
$8
$10
$12
$14
$16
20242025202620272028202920302031203220332034MillionsG.O. Debt Outstanding as of 12/31
2013B 2014A 2015B 2016A 2017A 2018A 2019A 2020A
107Table of Contents
STAFFING SUMMARY
Staffing, as measured by full-time equivalents, decreased in 2020 due to the COVID-19
pandemic and has been increasing each year since. Many employees perform across multiple
activities/divisions and funds. The budget reflects updates to the allocation of time spent in
various departments by all staff. The 2024 budget includes:
•Replacement of two part-time receptionists with one full-time employee
•Increased hours for part-time staff at the community center and to the Recreation
Coordinator position (previously a League Manager)
•The promotion of two positions (Project Engineer to Assistant City Engineer and a Parks
Operator to Parks Foreman)
Actual Actual Actual Budget Change
2021 2022 2023 2024 2021-2024
General Fund
City Administration 3.60 3.60 2.90 2.75 (0.85)
City Clerk 1.00 1.85 1.50 2.10 1.10
Finance 3.80 3.85 3.75 3.65 (0.15)
Human Resources 1.00 1.00 1.00 1.00 -
Planning & Zoning 1.10 1.40 1.90 1.90 0.80
Fire & Rescue 4.80 4.90 3.90 3.95 (0.85)
Building Inspections 3.00 4.20 5.20 5.20 2.20
Public Works Administration 1.90 1.10 1.10 1.05 (0.85)
Engineering & Inspections 1.35 1.55 1.55 1.55 0.20
Streets & Alleys 4.40 3.90 4.10 4.10 (0.30)
Ice & Snow 2.10 2.30 2.45 2.45 0.35
Shop & Garage 1.30 1.80 1.85 1.35 0.05
Park Operations 8.85 9.40 9.20 9.55 0.70
Shade Tree 0.75 0.90 0.90 0.90 0.15
Total General Fund 38.95 41.75 41.30 41.50 2.55
Special Revenue Funds
Economic Development 1.20 1.50 1.60 1.60 0.40
Monticello Community Center 13.40 18.05 20.75 22.25 8.85
Total Special Revenue Funds 14.60 19.55 22.35 23.85 9.25
Enterprise Funds
Wa ter 3.80 3.60 3.80 3.80 -
Sewer 3.75 3.75 3.55 3.55 (0.20)
Stormwater 1.10 1.40 1.55 1.55 0.45
Liquor 10.20 10.95 11.65 11.65 1.45
Deputy Registrar 7.50 8.35 7.55 7.55 0.05
Total Enterprise Funds 26.35 28.05 28.10 28.10 1.75
Internal Service Funds
Facilities Maintenance 0.50 1.10 1.10 1.10 0.60
IT Services 0.40 1.00 1.00 1.00 0.60
Total Internal Service Funds 0.90 2.10 2.10 2.10 1.20
Total All Funds 80.80 91.45 93.85 95.55 14.75
NUMBER OF FULL-TIME EQUIVALENTS
108Table of Contents
2024 Adopted Budget
General Fund
GENERAL FUND - SUMMARY
FUND DESCRIPTION
One of five governmental fund types, the General Fund serves as the chief operating fund of
the city. The General Fund accounts for all financial resources not accounted for in another
fund and uses the modified accrual basis of accounting for budgeting and financial reporting
purposes. The adopted General Fund budget is a balanced budget, which means current
revenues and other sources equal expenditures and other uses.
BUDGET SUMMARY
GENERAL FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 7,208,949$ 7,457,694$ 8,060,000$ 8,125,652$ 8,640,000$ 7.2%
Franchise & Other Taxes 217,833 254,247 316,500 247,854 346,500 9.5%
Licenses & Permits 804,889 613,015 484,000 930,901 487,000 0.6%
Intergovernmental Revenues 625,382 609,104 513,895 552,257 1,057,000 105.7%
Charges for Services 1,214,288 1,340,327 1,246,779 1,441,024 1,309,743 5.1%
Fines & Forfeits 49,566 36,808 51,600 52,413 51,600 0.0%
Special Assessments 468 418 100 156 100 0.0%
Miscellaneous 712,287 807,619 807,126 1,315,029 865,057 7.2%
Contributed Capital - - - 1,650 - ---
TOTAL REVENUES 10,833,663$ 11,119,234$ 11,480,000$ 12,666,936$ 12,757,000$ 11.1%
GENERAL FUND 2021 2022 2023 2023 2024 %
EXPENDITURES BY DEPT ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
GENERAL GOVERNMENT
Mayor and Council 57,171$ 55,262$ 59,462$ 46,095$ 59,727$ 0.4%
City Administration 949,428 934,031 1,045,775 948,361 1,052,879 0.7%
City Clerk 125,285 227,098 214,549 217,318 277,222 29.2%
Finance 578,248 625,522 664,739 665,662 681,352 2.5%
Legal 25,883 24,524 27,500 36,802 30,000 9.1%
Human Resources 131,467 139,335 165,336 161,908 183,576 11.0%
Planning & Zoning 685,171 598,179 354,158 532,438 371,851 5.0%
City Hall 68,095 76,002 82,182 75,823 65,249 -20.6%
General City Buildings 16,315 - - - - ---
TOTAL GENERAL GOVERNMENT 2,637,060$ 2,679,953$ 2,613,701$ 2,684,405$ 2,721,856$ 4.1%
PUBLIC SAFETY
Law Enforcement 1,602,877$ 1,633,774$ 1,869,245$ 1,872,417$ 2,485,193$ 33.0%
Fire & Rescue 459,591 546,373 483,309 508,104 467,138 -3.3%
Fire Relief 134,691 146,181 140,000 164,446 145,000 3.6%
Building Inspections 599,567 583,076 680,289 618,256 681,154 0.1%
Emergency Management 13,725 6,936 22,032 6,952 22,000 -0.1%
Animal Control 50,586 59,148 63,992 74,589 62,346 -2.6%
National Guard 13,143 14,398 19,500 19,068 19,500 0.0%
TOTAL PUBLIC SAFETY 2,874,179$ 2,989,887$ 3,278,367$ 3,263,832$ 3,882,331$ 18.4%
PUBLIC WORKS
Public Works Administration 244,353$ 140,020$ 166,456$ 150,093$ 169,738$ 2.0%
Engineering & Inspections 201,432 263,929 340,801 316,395 321,517 -5.7%
Streets & Alleys 919,552 1,153,419 1,250,020 1,322,405 1,395,343 11.6%
Ice & Snow 294,313 320,885 453,741 294,885 488,959 7.8%
Shop & Garage 269,192 295,614 320,948 283,360 330,016 2.8%
Street Lighting 195,055 226,690 292,000 243,482 322,000 10.3%
TOTAL PUBLIC WORKS 2,123,897$ 2,400,556$ 2,823,966$ 2,610,620$ 3,027,573$ 7.2%
109Table of Contents
The previous table summarizes General Fund expenditures by activities/divisions and
departments. The table below summarizes expenditures by classifications.
BUDGET COMMENTARY:
Revenues
For 2024, budgeted revenues are estimated to increase by 11.1%. The General Fund portion of
the tax levy is budgeted to increase by 7.2%, which is less than the total (city & HRA) levy
increase of 8.6% due to a 27.6% increase in the levy for capital. Property taxes account for 68%
of General Fund revenues. Franchise & Other Taxes increase to offset the increased cost of
GENERAL FUND 2021 2022 2023 2023 2024 %
EXPENDITURES BY DEPT ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
SANITATION
Refuse Collection 754,132$ 784,051$ 843,897$ 743,349$ 880,557$ 4.3%
TOTAL SANITATION 754,132$ 784,051$ 843,897$ 743,349$ 880,557$ 4.3%
RECREATION AND CULTURE
Senior Center 105,689$ 108,123$ 101,863$ 102,774$ 104,363$ 2.5%
Park Operations 1,098,442 1,235,093 1,428,756 1,498,828 1,576,051 10.3%
Park Ballfields 28,072 59,754 26,200 22,666 28,665 9.4%
Public Arts 93,246 146,282 173,528 154,167 174,903 0.8%
Shade Tree 87,526 94,217 145,707 86,149 266,722 83.1%
Library 44,506 48,401 38,015 101,498 87,979 131.4%
TOTAL RECREATION AND CULTURE 1,457,480$ 1,691,871$ 1,914,069$ 1,966,082$ 2,238,683$ 17.0%
Operating Transfers 1,002,368$ 154,900$ 6,000$ 753,950$ 6,000$ 0.0%
TOTAL EXPENDITURES 10,849,117$ 10,701,219$ 11,480,000$ 12,022,238$ 12,757,000$ 11.1%
GENERAL FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 7,208,949$ 7,457,694$ 8,060,000$ 8,125,652$ 8,640,000$ 7.2%
Franchise & Other Taxes 217,833 254,247 316,500 247,854 346,500 9.5%
Licenses & Permits 804,889 613,015 484,000 930,901 487,000 0.6%
Intergovernmental Revenues 625,382 609,104 513,895 552,257 1,057,000 105.7%
Charges for Services 1,214,288 1,340,327 1,246,779 1,441,024 1,309,743 5.1%
Fines & Forfeits 49,566 36,808 51,600 52,413 51,600 0.0%
Special Assessments 468 418 100 156 100 0.0%
Miscellaneous 712,287 807,619 807,126 1,315,029 865,057 7.2%
Contributed Capital - - - 1,650 - ---
TOTAL REVENUES 10,833,663$ 11,119,234$ 11,480,000$ 12,666,936$ 12,757,000$ 11.1%
EXPENDITURES
Personnel Services 3,433,833$ 3,739,053$ 4,091,941$ 3,972,164$ 4,299,928$ 5.1%
Supplies 748,686 817,643 1,020,200 788,679 994,649 -2.5%
Other Services & Charges 5,111,861 5,411,224 5,728,859 5,801,043 6,888,923 20.2%
Capital Outlay 552,369 578,400 633,000 646,702 567,500 -10.3%
Operating Transfers Out 1,002,368 154,900 6,000 753,950 6,000 0.0%
TOTAL EXPENDITURES 10,849,117$ 10,701,219$ 11,480,000$ 11,962,538$ 12,757,000$ 11.1%
FUND BALANCE - JANUARY 1 6,640,235$ 6,624,781$ 7,042,795$ 7,042,795$ 7,747,193$
Excess (Deficiency) of
Revenues over Expenditures (15,454) 418,014 - 704,398 -
FUND BALANCE - DECEMBER 31 6,624,781$ 7,042,795$ 7,042,795$ 7,747,193$ 7,747,193$
110Table of Contents
street lighting due to inflation. The increase in Intergovernmental Revenues is due to a one-
time state aid from the State of Minnesota for public safety and to combat Emerald Ash Borer
infestation in city trees. The increase in Charges for Services reflects higher residential garbage
and recycling charges. Miscellaneous Revenues are projected higher, but still conservatively, to
reflect projected earnings in the city’s investment portfolio.
Expenditures
Expenditures are budgeted to increase 11.1%. City Clerk department expenditures increase due
to the administration of three elections in 2024 (Presidential nominating primary, Primary, and
General). Additional software investments in the Human Resources department contribute to
that department’s increase. Planning & Zoning expenditures increase to better reflect spending
in response to development in recent years. The City Hall budget decreased due to an updated
allocation of the city’s insurance premiums and decreases in projected maintenance needs. The
General City Buildings (formerly Prairie Center Building) department was eliminated in 2021
because the DMV relocated there, and the building costs are now accounted for in the DMV
enterprise fund.
The Law Enforcement department increase reflects a substantial increase in the contracted
hourly rate and the remaining increase to the number of patrol hours per day (which was raised
from 52 to 60 effective May 1, 2023).
The Streets & Alleys and Ice & Snow budgets increased with the full year of the additional
streets department operator (hired in May 2023). The Streets & Alleys budget also includes a
fog seal maintenance project in 2024. The Street Lighting department increased to reflect the
increases in the costs of gas and electricity and assumed increased usage with the completion
of the Downtown Roadway & Pedestrian Improvements.
Park Operations increased due to the inclusion of pathway maintenance in the budget once
again. The pathway maintenance budget was significantly reduced the past few years to help
balance the budget, but the city acknowledges this is not fiscally responsible in the long term.
Shade Tree expenditures increased as Emerald Ash Borer (EAB) was found spreading in some
trees in the city. The city acquired grant funding to help offset the increased costs. Library
expenditures increase due to a project to replace the carpeting.
The 2024 personnel services budget includes a full step increase, where applicable, and a 4.0%
market rate wage increase. Supplies are projected to remain steady with inflation easing
slightly. Other Services & Charges increase from increased professional costs including the law
enforcement contract with Wright County. All the capital outlay amount reflects Capital
Equipment Fund purchases, which are charged back through lease payments and decreased
due to some pieces of equipment now considered fully paid for. The 2021 operating transfer
was to the Central Equipment Fund for future acquisitions. The operating transfer out in 2022 is
to build a healthy reserve in the new Facilities Maintenance internal service fund, and the 2023
operating transfer included $750,000 to the Capital Projects Fund to replenish some of the
reserves used for the Downtown Improvements project. As in 2023, the $6,000 budgeted in
2024 is to the EDA Fund for board member stipends, which is adjusted to actual cost at
yearend.
111Table of Contents
MAYOR AND CITY COUNCIL (101-41110)
DEPARTMENT: General Government SUPERVISOR: City Clerk
ACTIVITY SCOPE:
The mayor and council provide elected representation to the community with control over
policy, goals, budget, administration, and operations. Members participate in various
committees and direct staff through the city administrator.
OBJECTIVES:
1.Adopt policies and ordinances consistent with the council’s positions on growth,
zoning, and financial strategies.
2.Operate the city with transparency which includes public input in decision making.
ISSUES:
1.Capitalize on the city’s uniqueness by communicating a comprehensive vision
statement and setting achievable goals.
2.Examine city facility needs to meet future city operations.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The council’s budget remains consistent with previous years. The mayor earns $700 per month
and each councilmember earns $600 per month. Other services and charges are mainly
comprised of rental charges for the meeting room at the Monticello Community Center.
Measurement 2021 2022 2023 2024
Regular Council meetings 23 23 23 23
Special meetings/workshops 23 21 18 20
Full-Time Equivalents 0 0 0 0
GENERAL FUND 2021 2022 2023 2023 2024 %
MAYOR & COUNCIL Actual Actual Budget Estimated Budget Change
Personnel Services 45,952$ 41,739$ 42,012$ 34,477$ 42,277$ 0.6%
Supplies - - - - - ---
Other Services & Charges 11,219 13,523 17,450 11,618 17,450 0.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 57,171$ 55,262$ 59,462$ 46,095$ 59,727$ 0.4%
112Table of Contents
CITY ADMINISTRATION (101-41310)
DEPARTMENT: General Government SUPERVISOR: City Administrator
ACTIVITY SCOPE:
City administration provides the overall direction of the city, as determined by the mayor and
council. The city administrator serves as the chief administrative officer, ensuring that laws,
ordinances, and resolutions are implemented and enforced. The administrator is also
responsible for managing the operations of all city departments and providing customer
service for general city hall activities, such as reception and meeting room management.
OBJECTIVES:
1.Assist City Council in setting policies and procedures.
2.Provide direction and leadership on major city projects and budget management;
oversee performance evaluation and long-range planning.
3.Provide friendly, knowledgeable customer service to the public during adequate
and consistent hours of business.
4.Communicate mission, vision, and values along with city services and events to
the public.
ISSUES:
1.Leading and focusing council on policy matters.
2.Long-range comprehensive planning, including for development and traffic.
3.Continuing to improve internal and external communication systems, including
management of Citizen Service Desk.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Newsletters published 2 2 2 2
Monthly newletters sent*0 9 12 12
Utility inserts published*8 3 --
Park inserts published*3 2 --
All other inserts published*12 5 --
Information desk inquiries**350 127 107 125
*Individual inserts with utility bills were combined into one monthly newsletter
**Entries reduced with the implementation of an online resident reporting system
for department-specific issues
Full-Time Equivalents 3.60 3.60 2.90 2.75
113Table of Contents
BUDGET:
BUDGET COMMENTARY:
The city administration activity is limited to expenditures for daily operations in providing
services and does not include upkeep of the city hall facility. The 2024 personnel services
budget includes a full step increase and a 4.0% market rate wage increase. Returning to one
full-time employee for reception services, after almost two years of utilizing two part-time
employees, is included in the 2024 budget. Other services and charges includes the city’s
investments in solar farms, which is budgeted conservatively due to the unknown production as
each solar farm.
GENERAL FUND 2021 2022 2023 2023 2024 %
CITY ADMINISTRATION Actual Actual Budget Estimated Budget Change
Personnel Services 377,760$ 304,433$ 321,078$ 321,356$ 337,139$ 5.0%
Supplies 9,445 19,136 12,000 12,011 15,000 25.0%
Other Services & Charges 562,223 610,462 712,697 614,994 700,740 -1.7%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 949,428$ 934,031$ 1,045,775$ 948,361$ 1,052,879$ 0.7%
114Table of Contents
CITY CLERK (101-41410)
DEPARTMENT: General Government SUPERVISOR: City Clerk
ACTIVITY SCOPE:
The city clerk activity is responsible for administering elections, maintaining official records,
updating the city code, improving records management and data practices, and serving as the
data practices compliance officer and responsible authority.
OBJECTIVES:
1.Improve data storage practices and data request responses with digital storage
through Laserfiche.
2.Administer elections including upgrading election equipment and recruiting and
training judges.
ISSUES:
1.Manage storage space, including in Laserfiche, while organizing decades of files.
2.Maintain current, accurate information for all public sources.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2021 2022 2023 2024
Voters, number of 0 5,175 0 8,500
Registered voters 8,101 8,646 8,791 9,500
Polling places 2 4 4 4
Election judges 35 59 65 65
Ordinances amendments 20 26 25 25
Council resolutions 99 142 113 100
Council minutes approved 46 44 41 43
Data requests 31 27 51 40
Laserfiche folders 12,606 *17,410 20,000
Laserfiche documents 81,897 *142,280 200,000
Laserfiche pages 940,965 *1,497,324 1,750,000
*Data not obtained during the year
Full-Time Equivalents 1.00 1.85 1.50 2.10
GENERAL FUND 2021 2022 2023 2023 2024 %
CITY CLERK Actual Actual Budget Estimated Budget Change
Personnel Services 110,706$ 187,127$ 172,967$ 172,061$ 210,143$ 21.5%
Supplies 308 5,145 3,000 7,241 13,000 333.3%
Other Services & Charges 14,271 34,825 38,582 38,016 54,079 40.2%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 125,285$ 227,098$ 214,549$ 217,318$ 277,222$ 29.2%
115Table of Contents
BUDGET COMMENTARY:
Elections are held in even-numbered years causing increased expenditures. In 2020, there was
a Presidential Nominating Primary election in Minnesota for the first time since 1992. Off-year
election expenditures are for maintenance contracts on voting equipment. The 2024 personnel
services budget includes a full step increase and a 4.0% market rate wage increase. All budget
increases reflect the increase in costs for holding elections; there are no other special projects
of the city clerk included in the 2024 budget.
116Table of Contents
FINANCE (101-41520)
DEPARTMENT: General Government SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The Finance Department conducts the financial affairs of the city of Monticello in accordance
with the Government Accounting Standards Board (GASB) and Generally Accepted Accounting
Principles (GAAP). This includes protection of the assets of the city, the initiation of financial
plans, investment and debt management, review and implementation of internal controls, and
accounting for every financial transaction of the city including accounts payable, accounts
receivable, payroll, and general ledger accounting control. The preparation of the annual
audited financial report and annual budget document are also facilitated through finance. An
audit of city finances must be completed on an annual basis for the city to remain in compliance
with federal and state accounting practices.
OBJECTIVES:
1. Updating the long-term financial management plan annually.
2. Develop financial documents eligible for receipt of the Government Finance Officers
Association’s (GFOA) award programs.
3. Complete financial, payroll, and utility billing transactions to provide meaningful and
timely financial reports and information to council, commissions, and other city
departments.
4. Complete the annual financial audit with no audit findings and adjustments.
ISSUES:
1. Implement improved reporting to council, commissions, and departments.
2. Develop methods for simplifying data analysis for various stakeholders.
3. Work with other departments to find ways to reduce costs of city operations.
4. Cross-training of finance team members in core functions.
5. Comply with changing reporting requirements and auditing standards.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Outcome/Effectiveness:
GFOA Budget Awards 13 14 15 16*
GFOA Certificates of
Achievement 13 14 15*16*
GFOA Popular Annual
Financial Report Awards 7 8*9*10*
Bond Rating A1 A1 Aa3 Aa3
Audit findings 0 0 0 0*
Opinion Unmodified Unmodified Unmodified* Unmodified*
*Not yet available. Value is an estimate.
117Table of Contents
MEASURABLE WORKLOAD DATA (CONTINUED):
BUDGET:
BUDGET COMMENTARY:
The Finance budget includes funds to handle the financial transactions of the city, in an efficient
manner, while maintaining the highest level of internal controls and segregation of duties. The
2024 personnel services budget includes a full step increase and a 4.0% market rate wage
increase.
Measurement 2021 2022 2023 2024
Work Load:
AP checks, number of 1,685 1,568 1,457 1,400
AP ACHs, number of 1,355 1,462 1,545 1,600
Invoices processed 5,376 5,106 5,085 5,200
1099's 87 77 70 75
Paychecks issued 3,830 4,569 4,691 4,700
W-2s 287 255 322 325
Utility bills generated 53,647 54,898 55,532 56,000
Non-utility charges billed 243 262 276 275
Cash receipts entered 37,707 38,091 39,646 40,000
Journal entries 2,501 2,484 2,500* 2,500
New residential properties 68 95 35 60
New commercial properties 5 8 5 5
Tax exempt parcels 355 357 358 360
Taxable parcels assessed 4,732 4,821 4,916 4,940
Full-Time Equivalents 3.8 3.85 3.75 3.65
GENERAL FUND 2021 2022 2023 2023 2024 %
FINANCE Actual Actual Budget Estimated Budget Change
Personnel Services 387,444$ 408,605$ 432,098$ 432,607$ 445,505$ 3.1%
Supplies 859 1,701 2,300 2,183 2,300 0.0%
Other Services & Charges 189,945 215,217 230,341 230,872 233,547 1.4%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 578,248$ 625,522$ 664,739$ 665,662$ 681,352$ 2.5%
118Table of Contents
LEGAL (101-41610)
DEPARTMENT: General Government SUPERVISOR: City Administrator
ACTIVITY SCOPE:
Private legal firms provide all the city’s legal services. Activities include issuance of legal
opinions; preparation and/or review of ordinances, resolutions, contracts, and agreements; and
the conduct of civil litigation. Additional legal expenditures, such as publications, fees, and
other costs are accounted for in the benefitting unit.
OBJECTIVES:
1.Ensure compliance with applicable state statutes and federal regulations.
2.Minimize risk to the city by consulting with expert legal counsel.
ISSUES:
1.Potentially rising costs associated with the need for existing and new legal services.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The city continues to realize savings from not having full-time counsel. Legal services provided
to specific departments are charged to the benefitting budget unit while those performed
related to planning and development projects are passed through to the applicant.
Measurement 2021 2022 2023 2024
Billed hours:
Administration 237.5 232.4 296.8 250.0
Code enforcement 19.6 23.4 5.9 18.0
Fiber optics 2.0 0.0 0.0 1.0
City Projects & Acquisitions 174.2 98.4 86.9 125.0
All other, including development 78.5 86.1 35.9 66.0
Total 511.8 440.3 425.5 460.0
Full-Time Equivalents 0 0 0 0
GENERAL FUND 2021 2022 2023 2023 2024 %
LEGAL Actual Actual Budget Estimated Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 25,883 24,524 27,500 36,802 30,000 9.1%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 25,883$ 24,524$ 27,500$ 36,802$ 30,000$ 9.1%
119Table of Contents
HUMAN RESOURCES (101-41800)
DEPARTMENT: General Government SUPERVISOR: City Administrator
ACTIVITY SCOPE:
Human Resources activities support the primary mission of the city through the effective
recruitment, selection, development, training, and assessment of appropriate human resource
needs. Employee benefits and compensation administration, implementation of and
compliance with Federal and State employment laws, labor negotiations, processing of
employee grievances, and development of personnel policies are human resource functions.
OBJECTIVES:
1. Provide recruiting, interviewing, and other personnel services for all city departments.
2. Administer classification and compensation system for all employees in compliance
with pay equity.
3. Plan and coordinate in-house training programs for city staff.
4. Administer city benefit plans.
ISSUES:
1. Update personnel policies to accommodate changing employment law.
2. Communicate benefit changes to employees.
3. Develop and implement city drug and alcohol testing program.
4. Negotiate union contracts for public works employees.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2021 2022 2023 2024
Full-time positions 56 60 63 63
Part-time positions 116 133 146 146
Full-time positions filled 9 11 9 9
Other positions filled 85 93 73 73
Terminations processed 93 69 60 60
Job Postings 34 30 37 37
Application count - all city 491 511 638 638
Avg. number of employees 172 186 196 196
Full-Time Equivalents 1 1 1 1
GENERAL FUND 2021 2022 2023 2023 2024 %
HUMAN RESOURCES Actual Actual Budget Estimated Budget Change
Personnel Services 110,914$ 113,327$ 126,160$ 125,960$ 134,170$ 6.3%
Supplies 1,223 1,384 750 482 1,500 100.0%
Other Services & Charges 19,330 24,624 38,426 35,466 47,906 24.7%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 131,467$ 139,335$ 165,336$ 161,908$ 183,576$ 11.0%
120Table of Contents
BUDGET COMMENTARY:
The 2024 budget reflects estimated costs for setting up training, providing city staff with benefit
and compensation information, and other expenses based on experience. The 2024 personnel
services budget includes a full step increase and a 4.0% market rate wage increase. Supplies
doubled to reflect actual costs in prior years. Other Services & Charges increase with additional
contributions to the IT Services fund for implementation of a new performance review module
in NeoGov.
121Table of Contents
PLANNING, ZONING & COMMUNITY DEVELOPMENT (101-41910)
DEPARTMENT: General Government SUPERVISOR: Community Development Director
ACTIVITY SCOPE:
The Planning & Zoning and Community Development Department is responsible for long-range
and current planning efforts for Monticello. The department is responsible for regulating
development and use standards as outlined in the zoning and subdivision ordinance; these
standards are aimed at protecting and promoting public health, safety, and welfare. The
department oversees coordination with regional planning and service providers including
Monticello Township Board, Monticello Orderly Annexation Board, Wright County Planning &
Zoning, Sherburne County Planning & Zoning and regional transit entities. The department also
provides residents, business owners, and developers with current, easily accessible information
about Monticello's planning process and projects happening in their community.
OBJECTIVES:
1.Implementation of Comprehensive Plan objectives, including subdivision ordinance
amendments consistent with the Implementation Chart.
2.Support for downtown redevelopment and revitalization.
3.Involvement in regional planning and its impact on land use and growth objectives.
4.Training on and utilization of the city's GIS.
5.Improvements to the city's development and planning process.
6.Increased support for neighborhood organizations and involvement.
ISSUES:
1.Zoning compliance and enforcement.
2.Records management and integration for planning and zoning.
3.Land use and transportation relationships.
4.Emerging technology and land use impacts.
122Table of Contents
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Outcome/Effectiveness:
Grants awarded 1 0 0 1
Administrative applications (total)7 8 9 7
Processed within 5 working days 7 5 6 7
Site Plan reviews processed
within 14 working days 0 2 0 2
Change in Use forms 8 6 11 5
reviewed within 5 working days 5 6 9 5
Zoning Confirmation/Request Ltrs -10 13 10
processed within 10 working days -10 12 10
Sign Permit zoning reviews 20 23 21 20
processed within 5 working days 20 10 18 20
Land Use applications processed 94 95 84 75
within 60 working days 90 87 75 70
Reconciliations processed 16 31 19 25
Annexation petitions 1 0 1 1
Work Load:
Planning Applications:
Variances 5 0 0 1
CUPs 15 8 12 8
PUD/Amendments to PUD 15 15 11 8
Interim Use permits 1 2 0 0
Comp Plan amendments 0 1 4 1
Map amendments 2 6 4 5
Non-city zoning text amendments 1 1 4 2
Plats/adminstrative subdivisions 11 16 7 12
Administrative permits 7 8 9 10
Site plan reviews 2 2 1 2
Appeals 3 0 0 0
Vacations 4 7 1 2
Sign permit application review 20 23 21 20
Change in Use review 8 6 10 5
Total applications 94 95 84 76
Planning reconciliations 16 31 19 30
Planning Commission meetings 20 29 23 20
BCOL Advisory Meetings 4 1 3 2
PARC Meetings (Report Prep)3 4 1 4
EDA Meetings 18 33 26 24
IEDC Meetings 8 11 11 8
Full-Time Equivalents 1.1 1.4 1.9 1.9
123Table of Contents
BUDGET:
BUDGET COMMENTARY:
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
increase. The receipt of a Community Energy Transitions (CET) grant from the State of
Minnesota’s Department of Employment and Economic Development (DEED) in 2022 led to
expenditures well over budget. The Monti:2040 Comprehensive Plan was adopted in 2020.
GENERAL FUND 2021 2022 2023 2023 2024 %
PLANNING & ZONING Actual Actual Budget Estimated Budget Change
Personnel Services 168,500$ 217,645$ 234,095$ 237,907$ 249,647$ 6.6%
Supplies 168 745 300 60 300 0.0%
Other Services & Charges 516,503 379,788 119,763 294,471 121,904 1.8%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 685,171$ 598,179$ 354,158$ 532,438$ 371,851$ 5.0%
124Table of Contents
CITY HALL (101-41940)
DEPARTMENT: General Government SUPERVISOR: City Administrator
ACTIVITY SCOPE:
The activity for this department consists of maintenance and upkeep for the city hall suite
within the Monticello Community Center.
OBJECTIVES:
1. Provide adequate and consistent hours of operations throughout the year.
2. Maintain a clean, inviting facility to house meetings and staff.
ISSUES:
1. Depreciation of facility, timely maintenance and rising utility costs.
2. Examining layout to accommodate new uses and trends.
3. Building and office security.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
Items budgeted for supplies include a new conference table and chairs, which were budgeted
but didn’t occur in 2023. Other Services & Charges decreased due to a smaller allocation of the
Facilities Maintenance Fund budget but increased with a project to research options to
maximize the layout to be completed in future years.
Measurement 2021 2022 2023 2024
Utilities $21,972 $27,337 $26,889 $24,500
Repairs & Maintenance $10,279 $11,982 $18,481 $4,557
Full-Time Equivalents 0 0 0 0
GENERAL FUND 2021 2022 2023 2023 2024 %
CITY HALL Actual Actual Budget Estimated Budget Change
Personnel Services 2,579$ 4,894$ -$ 3,633$ -$ ---
Supplies - 1,694 7,000 - 8,500 21.4%
Other Services & Charges 65,516 69,413 75,182 72,190 56,749 -24.5%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 68,095$ 76,002$ 82,182$ 75,823$ 65,249$ -20.6%
125Table of Contents
LAW ENFORCEMENT (101-42100)
DEPARTMENT: Public Safety SUPERVISOR: City Administrator
ACTIVITY SCOPE:
All law enforcement services are contracted with the Wright County Sheriff's Department. The
Sheriff’s Department uses space at the new Fire Station for staff break time and other officing
uses. The Sheriff sets the hourly rate and the city contracts for the number of hours, which
were increased from 52 hours per day to 60 hours per day effective May 1, 2023.
OBJECTIVES:
1.Protect life and property and improve the quality of community life.
2.Continue contracting for law enforcement services from Wright County.
3.Provide coverage for commercial and residential growth.
ISSUES:
1.Concerns from residents regarding the perception the city does not have its own
police force.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2021 2022 2023 2024
Outcome/Effectiveness:
Arrests 204 230 242 250
Arrests to crimes ratio 0.26 0.34 0.33 0.33
Efficiency:
Hours contracted 18,980 18,980 20,940 21,960
Calls per hour contracted 0.41 0.50 0.52 0.45
Costs per workload unit $197.36 $168.06 $168.40 $231.16
Work Load:
Life quality calls, number of 2,693 4,774 4,488 4,500
Traffic calls, number of 4,074 3,683 5,187 4,350
Vehicle crashes, number of 325 371 370 375
Crimes, number of 770 681 742 750
Full-Time Equivalents 0 0 0 0
GENERAL FUND 2021 2022 2023 2023 2024 %
LAW ENFORCEMENT Actual Actual Budget Estimated Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 1,602,877 1,633,774 1,869,245 1,872,417 2,485,193 33.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 1,602,877$ 1,633,774$ 1,869,245$ 1,872,417$ 2,485,193$ 33.0%
126Table of Contents
BUDGET COMMENTARY:
Law enforcement services are contracted in five-hour-per-day increments from the Wright
County Sheriff’s Office (WCSO) Department. Prior to 2023, the WCSO contract was handled in
four-hour-per-day increments. Past hourly rates and contracted hours are presented in the
schedule below:
The city contracted for 52 hours per day through 2013. From 2014 through 2017, the city
contracted for 48 hours per day. In July 2018, the city returned to contracting for 52 hours per
day, and increased to 60 hours per day in May 2023. The leap years of 2016, 2020, and 2024
include one more day of coverage (48 hours in 2016, 52 hours in 2020, and 60 hours in 2024).
Hourly Hours
Year Rate Contracted
2015 $64.50 17,520
2016 $67.00 17,568
2017 $69.50 17,520
2018 $72.00 18,256
2019 $74.50 18,980
2020 $78.25 19,032
2021 $81.75 18,980
2022 $84.20 18,980
2023 $86.75 20,940
2024 $105.00 21,960
127Table of Contents
FIRE & RESCUE (101-42200)
DEPARTMENT: Public Safety SUPERVISOR: City Administrator
ACTIVITY SCOPE:
The Fire Department’s paid-on-call volunteers respond to fire, rescue, hazardous materials,
medical, and accident calls within the city and the surrounding townships.
OBJECTIVES:
1. Provide quick response to emergency situations in the community.
ISSUES:
1. Training, retention, and safety of paid-on-call personnel.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Outcome/Effectiveness:
Respondent-hours on fire calls:
City 2,903 3,443 3,500 3,300
Monticello Township 1,183 1,138 1,277 1,200
Silver Creek Township 385 562 417 450
Mutual Aid 406 130 396 310
Drills & Maintenance 2,310 2,396 2,462 2,500
Total 7,187 7,669 8,052 7,760
Efficiency:
Average respondent-hours per call
City 11 13 13 12
Monticello Township 15 15 16 15
Silver Creek Township 17 19 17 18
Mutual Aid 25 19 23 21
Drills & Maintenance 37 43 40 42
Total 16 17 18 17
Work Load:
Number of fire calls:
City 254 273 266 265
Monticello Township 80 74 82 80
Silver Creek Township 23 30 24 25
Mutual Aid 16 7 17 15
Drills & Maintenance 63 56 61 60
Total 436 440 450 445
Firefighters, number of 30 30 30 30
128Table of Contents
BUDGET:
BUDGET COMMENTARY:
The 2024 personnel services budget includes a 4.0% market rate wage increase. The purchase
of turnout gear and radios contribute to the higher supplies budget in 2024. Grants and
donations may offset some of these expenditures. Capital outlay reflects lease payments to the
Central Equipment Fund for various pieces of equipment. The fire tender truck purchased in
2014 is considered fully paid off which decreased the costs in 2024.
GENERAL FUND 2021 2022 2023 2023 2024 %
FIRE & RESCUE Actual Actual Budget Estimated Budget Change
Personnel Services 212,845$ 208,445$ 147,061$ 171,370$ 156,261$ 6.3%
Supplies 45,909 59,604 71,300 61,989 81,500 14.3%
Other Services & Charges 138,138 215,624 202,248 212,045 207,977 2.8%
Capital Outlay 62,700 62,700 62,700 62,700 21,400 -65.9%
TOTAL EXPENDITURES 459,591$ 546,373$ 483,309$ 508,104$ 467,138$ -3.3%
129Table of Contents
FIRE RELIEF (101-42202)
DEPARTMENT: Public Safety SUPERVISOR: Finance Director
ACTIVITY SCOPE:
Providing a retirement benefit to paid-on-call volunteers, the fire relief activity is specifically
designed to track contributions to the Monticello Fire Relief Association.
OBJECTIVES:
1.Provide pension funds for the Monticello Fire Relief Association.
ISSUES:
1.Balancing pension assets with pension liabilities.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The fire relief budget acts as a conduit for distribution of state fire aid to the pension fund for
volunteer firefighters. State aid revenue equals the contribution to the relief association, and it
is conservatively estimated for budgetary purposes.
Measurement 2021 2022 2023 2024
Pension assets 1,712,617$ 1,427,149$ 1,428,581$ 1,500,000$
Pension liabilities 1,459,556$ 1,607,907$ 1,101,220$ 1,200,000$
Assets-liabilities ratio 1.17 0.89 1.30 1.25
Pension per service year $5,100 $5,100 $5,300 $5,300
Fire state aid $134,691 $146,181 $161,446 $145,000
State aid per employee $4,490 $4,873 $5,382 $4,833
Active firefighters 30 30 30 30
Deferred firefighters 6 6 4 4
*2023 assets and liabilities estimated per Form SC-23
Full-Time Equivalents 0 0 0 0
GENERAL FUND 2021 2022 2023 2023 2024 %
FIRE RELIEF Actual Actual Budget Estimated Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 134,691 146,181 140,000 164,446 145,000 3.6%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 134,691$ 146,181$ 140,000$ 164,446$ 145,000$ 3.6%
130Table of Contents
BUILDING INSPECTIONS (101-42400)
DEPARTMENT: Public Safety SUPERVISOR: Community Development Director
ACTIVITY SCOPE:
The Building Department inspects all new and remodeled construction within the city by a state
certified building inspector. The department manages all building permits and oversees the
enforcement of all public nuisance and ordinance issues. Beginning in 2022, the department
provides fire inspection services, which used to be handled by the Fire & Rescue department.
OBJECTIVES:
1. Implementation and enforcement of the building codes.
2. Implementation of the rental licensing program.
3. Management of zoning ordinance and sign ordinance updates.
4. Implement yearly contractor, realtor, and rental property owner workshops.
5. Improve city's public perception image through education and public relations.
ISSUES:
1. Managing and prioritizing department workloads.
2. Meeting the residential and commercial growth challenges as a regional center.
3. Enforcing biennial rental license inspections.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Outcome/Effectiveness:
Value of permits issued 66,827,121$ 41,989,848$ 76,068,705$ 50,000,000$
Value of permits per FTE 22,275,707$ 10,497,462$ 15,213,741$ 10,000,000$
Efficiency:
Departmental FTEs 3 4 5 5
Rental inspections per FTE 385 159 304 150
Permits per FTE 336 227 224 180
Work Load:
Building permits issued 1008 909 1122 900
Nuisance notices issued 82 142 136 125
Rental inspections 1,156 636 1,519 750
Rental units 1,776 1,895 1,932 2,000
Full-Time Equivalents 3.0 4.2 5.2 5.2
131Table of Contents
BUDGET:
BUDGET COMMENTARY:
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
increase. The fire marshal position, previously reported in the fire & rescue department, was
eliminated in 2022 and the building department absorbed the fire inspection responsibilities.
Supplies return to previous levels after the enforcement of lock boxes throughout the city in
2022 and 2023. Other services & charges reflect higher costs for code enforcement. Capital
outlay reflects the purchases of building inspector vehicles in prior years. A replacement vehicle
is not needed in 2024.
GENERAL FUND 2021 2022 2023 2023 2024 %
BUILDING INSPECTIONS Actual Actual Budget Estimated Budget Change
Personnel Services 367,552$ 466,452$ 592,885$ 546,502$ 624,428$ 5.3%
Supplies 41,500 12,974 9,000 6,208 7,000 -22.2%
Other Services & Charges 74,746 33,651 43,404 30,546 49,726 14.6%
Capital Outlay 115,769 70,000 35,000 35,000 - -100.0%
TOTAL EXPENDITURES 599,567$ 583,076$ 680,289$ 618,256$ 681,154$ 0.1%
132Table of Contents
EMERGENCY MANAGEMENT (101-42500)
DEPARTMENT: Public Safety SUPERVISOR: Emergency Management Coordinator/Fire Chief
ACTIVITY SCOPE:
The emergency management department provides constant defense coverage for all weather
and power plant related emergency situations within the city.
OBJECTIVES:
1.Complete city hall, community center, and National Guard emergency preparedness.
2.Develop National Incident Management System (NIMS) training for all city
departments.
ISSUES:
1.Preparedness - little or no warning when an emergency occurs.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The 2024 budget is based on the 2023 budget with a slight decrease in expenditures for
supplies and other services & charges related to a state grant received through Wright County.
Much of this activity's responsibilities had been transferred to Wright County. However, the city
is an active participant of the emergency management team.
Measurement 2021 2022 2023 2024
Data under development
GENERAL FUND 2021 2022 2023 2023 2024 %
EMERGENCY MANAGEMENT Actual Actual Budget Estimated Budget Change
Personnel Services 1,615$ 2,126$ 3,225$ 54$ 3,225$ 0.0%
Supplies 8,781 3,906 6,500 - 6,500 0.0%
Other Services & Charges 3,329 904 12,307 6,898 12,275 -0.3%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 13,725$ 6,936$ 22,032$ 6,952$ 22,000$ -0.1%
133Table of Contents
ANIMAL CONTROL (101-42700)
DEPARTMENT: Public Safety SUPERVISOR: City Clerk
ACTIVITY SCOPE:
The city contracts with a private individual for animal control services. The city owns and
maintains the animal control facility. The city also contracts with nearby communities, allowing
them to use the city’s services and facility.
OBJECTIVES:
1. Address animal control issues in a timely and courteous manner.
2. Promote simple and efficient billing procedures for animal control issues.
ISSUES:
1. Provide quick response to residents on animal control concerns.
2. Allocation of service costs based on usage by customers (townships and cities).
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The professional service contract to handle all animal control issues is the largest budgeted
item. The remaining budget items are for supplies and other service charges related to
operating the animal control facility. Rate increases cause the budgeted increase in animal
control fee.
Measurement 2021 2022 2023 2024
Stray animal reports 432 501 491 475
Barking dog reports 206 241 187 215
Lost/found reports 1,732 2,117 1,819 1,900
Feral cat trapping 284 313 151 250
Unsanitary condition reports 197 157 141 165
Abuse/neglect reports 186 206 171 190
Impounds 440 524 469 480
Dog bite reports 67 51 51 60
Animal control fees $52,482 $59,861 $52,608 $64,600
Full-Time Equivalents 0 0 0 0
GENERAL FUND 2021 2022 2023 2023 2024 %
ANIMAL CONTROL Actual Actual Budget Estimated Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies 260 2,172 1,750 - 1,250 -28.6%
Other Services & Charges 50,326 56,976 62,242 74,589 61,096 -1.8%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 50,586$ 59,148$ 63,992$ 74,589$ 62,346$ -2.6%
134Table of Contents
NATIONAL GUARD (101-42800)
DEPARTMENT: Public Safety SUPERVISOR: Facilities Maintenance Manager
ACTIVITY SCOPE:
The National Guard (NG) facility is housed in the Monticello Community Center complex. The
city will maintain the facility in perpetuity in return for a one-time payment in 1998 that helped
fund construction of the community center. However, the NG will contribute to capital
improvements made to the building. The Guard provides no direct services to the city.
OBJECTIVES:
1.Maintain a clean, modern facility for use by the National Guard.
ISSUES:
1.None.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The National Guard operates a security division within the Monticello Community Center
complex. The city maintains the Guard’s site within the complex. The budget for this activity is
relatively static, consisting only of building rent and utilities. However, the budget was
increased in 2023 to reflect higher gas and electric rates and to properly reflect the time the NG
uses certain amenities of the facility for their training purposes.
Measurement 2021 2022 2023 2024
Not Applicable
GENERAL FUND 2021 2022 2023 2023 2024 %
NATIONAL GUARD Actual Actual Budget Estimated Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 13,143 14,398 19,500 19,068 19,500 0.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 13,143$ 14,398$ 19,500$ 19,068$ 19,500$ 0.0%
135Table of Contents
PUBLIC WORKS ADMINISTRATION (101-43110)
DEPARTMENT: Public Works SUPERVISOR: Public Works Director
ACTIVITY SCOPE:
The public works (PW) administration activity oversees the daily operations of the engineering,
street, water, sewer, and stormwater activities. PW administration also manages all large city
projects and implements all changes to PW operations and policy.
OBJECTIVES:
1. Implementation of the bio-solids management system, major street lighting project
plan, and wellhead protection plan.
2. Manage the development of a new public works facility, expansion of the wastewater
treatment plant, and construction of a water treatment plant.
3. Determine location for future wells, utilizing information gathered from various
sources including grants.
ISSUES:
1. Balance the public works department needs with available funds.
2. Manage city's water and wastewater treatment systems and SCADA system.
3. Implement the capital improvement plan for city infrastructure.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
increase. The public works director/engineering position is spread over four budgets: General
Fund (split between PW Administration and Engineering & Inspections) - 60%, Sewer Fund –
20%, Water Fund – 15%, and Stormwater Fund – 5%. Other services & charges increase for
reallocated I-94 Coalition dues (previously recorded in Engineering & Inspections).
Measurement 2021 2022 2023 2024
Budget units 15 15 15 15
Employees supervised - FT 16 16 17 17
Full-Time Equivalents 1.90 1.10 1.10 1.05
GENERAL FUND 2021 2022 2023 2023 2024 %
PW - ADMINISTRATION Actual Actual Budget Estimated Budget Change
Personnel Services 209,417$ 113,560$ 118,819$ 113,392$ 119,256$ 0.4%
Supplies 6,118 4,692 7,000 5,088 7,000 0.0%
Other Services & Charges 28,818 21,767 40,637 31,613 43,482 7.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 244,353$ 140,020$ 166,456$ 150,093$ 169,738$ 2.0%
136Table of Contents
ENGINEERING & INSPECTIONS (101-43115)
DEPARTMENT: Public Works SUPERVISOR: City Engineer
ACTIVITY SCOPE:
The engineering department handles the provision, development, and management of the
city's streets, pathways, public utilities systems, geographic information system (GIS), Storm
Water Pollution Prevention Program (SWPPP), improvement projects, and miscellaneous
mapping. Engineering also issues driveway, grading, and right-of-way permits. Personnel are
also responsible for managing records retention for plats, city maps, infrastructure data bases,
soil borings, development plans, and as-builts. Using various computer software programs
including ArcGIS, AutoCADm and CarteGraph, staff provides design and mapping assistance.
OBJECTIVES:
1.Complete cost estimates (capital infrastructure planning and budgeting) and design
for all improvement projects.
2. Improve GIS system and utilization of CarteGraph software for the in-house Pavement
Management and Sign Program.
3.Assist with design, implementation and public education drainage issue solutions.
4.Complete inspections, documentation, and administration of city’s SWPPP.
5.Operate a one-stop shop for city driveway, grading, and right-of-way permits.
6.Improve the city’s transportation system by collaborating with MNDOT and Wright
County.
7.Work with other departments on public improvements and review development plans
and agreements.
8.Apply for grants and track funding for improvement projects.
ISSUES:
1.Workload is unevenly distributed throughout the year.
2.Increasing restrictions by Minnesota Pollution Control Agency (MPCA) for storm water
runoff.
3.Lack of public knowledge regarding purposes and practices associated with
conservation and drainage easements and storm water ponds.
4.Increasing phosphorus restrictions by MPCA for wastewater effluent.
5.Volatility in available federal and state funding for transportation improvements.
137Table of Contents
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
increase. The engineering activity predominantly consists of engineering and other professional
service fees. These expenditures include both reimbursable and non-reimbursable
expenditures. The 2024 budget increases supplies costs to include traffic counters, and other
services & charges were reduced to better reflect prior year trends in activity from contracted
vendors.
Measurement 2021 2022 2023 2024
Improvement projects 16 17 17 15
Driveway permits issued 3 15 18 12
Right-of-way permits issued 87 59 80 80
Development applications 7 7 6 6
Grading permits issued 4 5 2 5
NPDES Inspections 383 394 434 390
Outfall Inspections 10 1 17 2
Stormwater Inspections 50 50 52 52
Pond Inspections 0 31 35 32
Inspection revenue $31,339 $45,864 $83,456 $79,000
Inspection hours billed 259.0 385.5 652.0 450.0
Full-Time Equivalents 1.35 1.55 1.55 1.55
GENERAL FUND 2021 2022 2023 2023 2024 %
PW - ENG. & INSPECTIONS Actual Actual Budget Estimated Budget Change
Personnel Services 95,509$ 188,966$ 208,696$ 211,753$ 217,452$ 4.2%
Supplies 2,078 9,597 16,500 3,301 18,000 9.1%
Other Services & Charges 103,844 59,366 109,605 95,341 80,065 -27.0%
Capital Outlay - 6,000 6,000 6,000 6,000 0.0%
TOTAL EXPENDITURES 201,432$ 263,929$ 340,801$ 316,395$ 321,517$ -5.7%
138Table of Contents
STREETS & ALLEYS (101-43120)
DEPARTMENT: Public Works SUPERVISOR: Street Superintendent
ACTIVITY SCOPE:
The main responsibility of the streets and alleys activity is to perform the necessary tasks to
reduce the depreciation of the city streets and uphold desirable standards of appearance,
serviceability, and safety. This includes upkeep such as repair of roadway surface areas,
medians, sidewalks, boulevards, alleys, catch basins, and storm sewers.
OBJECTIVES:
1. Street reconstruction of older road surfaces prioritized by evaluating road wear.
2. Utilize street chip seal coating projects and crack sealing program to get the most out
of the city’s street system before replacement is needed.
3. Maintain and update equipment and vehicles.
ISSUES:
1. Educating the public on what the boulevards are to be used for and on the value of
good maintenance programs for our infrastructure.
2. Increased costs of fuel and street products.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
increase. A new streets operator began in May 2023. This budget unit also shares staff with the
Ice & Snow activity, which can create significant fluctuations from year to year. Increases in
capital outlay reflects purchases in the Central Equipment Fund for equipment leased to the
streets department. Other services & charges continues increase for a fog seal maintenance
project in 2024.
Measurement 2021 2022 2023 2024
Pounds of crack sealer 18,276 0 0 36,270
Miles of streets 70.0 81.0 81.0 81.0
Tons of black top patching 527 664 1,053 1,053
Full-Time Equivalents 4.4 3.9 4.1 4.1
GENERAL FUND 2021 2022 2023 2023 2024 %
PW - STREETS & ALLEYS Actual Actual Budget Estimated Budget Change
Personnel Services 376,850$ 352,831$ 425,071$ 430,120$ 438,635$ 3.2%
Supplies 219,967 321,311 287,000 253,664 313,000 9.1%
Other Services & Charges 75,635 181,377 156,349 243,318 249,208 59.4%
Capital Outlay 247,100 297,900 381,600 395,302 394,500 3.4%
TOTAL EXPENDITURES 919,552$ 1,153,419$ 1,250,020$ 1,322,405$ 1,395,343$ 11.6%
139Table of Contents
ICE & SNOW REMOVAL (101-43125)
DEPARTMENT: Public Works SUPERVISOR: Street Superintendent
ACTIVITY SCOPE:
The city's ice and snow removal activity is responsible for the control of ice and snow on city
streets, sidewalks, and city-owned public parking lots. The activity provides control in a safe and
cost-effective manner while keeping in mind safety, personnel, and environmental concerns.
OBJECTIVES:
1.Maintain and update equipment and vehicles in a timely manner.
ISSUES:
1.Staffing and budgeting for unpredictable circumstances.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
increase. Weather variability greatly impacts budget-to-actual comparisons.
Measurement 2021 2022 2023 2024
Inches of snow 26 48 82 40
Plowing events 34 28 37 32
Tons of salt used 700 600 620 600
Tons of sand used 0 24 29 35
Full-Time Equivalents 2.10 2.30 2.45 2.45
GENERAL FUND 2021 2022 2023 2023 2024 %
PW - ICE & SNOW Actual Actual Budget Estimated Budget Change
Personnel Services 154,847$ 161,455$ 268,232$ 131,164$ 277,917$ 3.6%
Supplies 133,850 132,187 156,000 146,402 175,000 12.2%
Other Services & Charges 5,617 27,243 29,509 17,318 36,042 22.1%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 294,313$ 320,885$ 453,741$ 294,885$ 488,959$ 7.8%
140Table of Contents
SHOP & GARAGE (101-43127)
DEPARTMENT: Public Works SUPERVISOR: Street Superintendent
ACTIVITY SCOPE:
Shop & Garage maintains all city vehicles and equipment for the streets, ice & snow, water, and
sewer activities in a safe and efficient manner. The department also assists with equipment
maintenance of other city departments as needed.
OBJECTIVES:
1.Maintain equipment and vehicles to maximize efficiencies and safety.
ISSUES:
1.Aging equipment.
2.Increased safety regulation for equipment and vehicles.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
increase offset by the retirement of the part-time custodian that is now contracted out. The
increase in Other services & charges is due to increases rate for utilities and a structural analysis
of the site’s monopole.
Measurement 2021 2022 2023 2024
Service orders 100 85 75 75
Service order hours 401 114 175 150
Hours per service order 4.0 1.3 2.3 2.0
Total service order costs $27,000 $14,367 $7,310 $16,000
Service cost per order $270.00 $169.02 $97.47 $213.33
Repair orders 70 28 28 30
Repair hours 420 127 162 125
Hours per repair order 6.0 4.5 5.8 4.2
Total repair order costs $40,000 $16,513 $11,941 $15,000
Repair costs per order $571.43 $589.75 $426.46 $500.00
Full-Time Equivalents 0.80 1.30 1.35 1.35
GENERAL FUND 2021 2022 2023 2023 2024 %
PW - SHOP & GARAGE Actual Actual Budget Estimated Budget Change
Personnel Services 130,946$ 160,499$ 161,965$ 152,846$ 141,277$ -12.8%
Supplies 48,723 47,329 74,000 53,862 55,500 -25.0%
Other Services & Charges 89,523 87,787 84,983 76,653 133,239 56.8%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 269,192$ 295,614$ 320,948$ 283,360$ 330,016$ 2.8%
141Table of Contents
STREET LIGHTING (101-43160)
DEPARTMENT: Public Works SUPERVISOR: Street Superintendent
ACTIVITY SCOPE:
The street Iighting activity maintains new and existing street lighting within the city. This
includes maintaining installed bulbs and fixtures, as well as the electricity used for keeping the
lights on.
OBJECTIVES:
1.Maintain streetlights and replace them with high-powered, energy efficient LED lights.
2.Draft a new street lighting policy.
ISSUES:
1.Verify lamp and fixtures maintenance by utility companies.
2.Maintenance and upgrades on aging signal systems and streetlights.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The supplies budget decreased from the budgeted one-time replacement of the city’s holiday
lights in 2023, which ended up being repaired rather than replaced. Electricity for the
streetlights is the largest budgeted expenditure at $250,000, which was increased in 2024 in
anticipation of increased usage along with contracted installation of holiday light fixtures in the
Downtown.
Measurement 2021 2022 2023 2024
Street lights maintained*973 973 973 1,025
Utilities expenses $177,026 $201,145 $199,669 $250,000
*Includes those owned by the city and Xcel Energy.
Full-Time Equivalents 0 0 0 0
GENERAL FUND 2021 2022 2023 2023 2024 %
PW - STREET LIGHTING Actual Actual Budget Estimated Budget Change
Personnel Services 2,218$ 882$ -$ -$ -$ ---
Supplies 3,219 5,083 70,000 856 12,000 -82.9%
Other Services & Charges 189,619 220,724 222,000 242,625 310,000 39.6%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 195,055$ 226,690$ 292,000$ 243,482$ 322,000$ 10.3%
142Table of Contents
REFUSE COLLECTION (101-43230)
DEPARTMENT: Public Works SUPERVISOR: Refuse Collection
ACTIVITY SCOPE:
The city contracts with a private hauler for residential refuse and recycling collection services.
OBJECTIVES:
1. Offer cost-effective, convenient and quality refuse and recycling removal services to
residential properties in the city.
ISSUES:
1. Wear and tear on city streets.
2. Desire to increase recycling efficiency and effectiveness.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
Nearly the entire budget is based on the city’s contract obligations with its private refuse
hauler. The contract includes fixed rates for the five-year term, which expires on May 31, 2025.
The contract increases annually with inflation and the addition of residents/customers.
Measurement 2021 2022 2023 2024
Residential refuse collections 52 52 52 52
Residential recycling collections 26 26 26 26
Residential container base 4,091 4,159 4,192 4,200
Additional containers 644 652 664 650
Recycling containers 4,680 4,757 4,790 4,850
Full-Time Equivalents 0 0 0 0
GENERAL FUND 2021 2022 2023 2023 2024 %
REFUSE COLLECTION Actual Actual Budget Estimated Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 754,132 784,051 843,897 743,349 880,557 4.3%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 754,132$ 784,051$ 843,897$ 743,349$ 880,557$ 4.3%
143Table of Contents
SENIOR CENTER (101-45175)
DEPARTMENT: Recreation and Culture SUPERVISOR: City Administrator
ACTIVITY SCOPE:
The senior center facility is housed in the Monticello Community Center complex. The facility is
maintained by the city, but senior center management is provided by an outside entity.
OBJECTIVES:
1.Maintain a clean, modern facility for use by Monticello’s senior citizens.
2.Engage senior citizen participation in other community center activities.
ISSUES:
1.Limited space within community center facility.
2.Increasing utilities and maintenance costs.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The senior center is located within the community center complex. The city maintains and
insures the senior center, which requires some community center staff time, but is so minimal
that no staff wages are formally allocated to the budget unit. Additionally, the city gives an
annual contribution to the group managing the senior center. The 2024 adopted contribution is
$67,500.
Measurement 2021 2022 2023 2024
Outcomes/Effectiveness
Volunteers hours 5,631 7,004 9,485 9,500
Noon meals served 1,799 3,108 3,016 3,100
Work Load:
Unduplicated participants 1,762 2,450 2,495 2,500
Duplicated participants 16,225 24,795 28,918 28,950
Received phone calls 3,439 3,875 3,793 3,800
Activities offered 104 127 129 130
Full-Time Equivalents 0 0 0 0
GENERAL FUND 2021 2022 2023 2023 2024 %
SENIOR CENTER Actual Actual Budget Estimated Budget Change
Personnel Services 635$ 1,220$ 863$ 1,458$ 863$ 0.0%
Supplies - 501 - - - ---
Other Services & Charges 105,054 106,402 101,000 101,316 103,500 2.5%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 105,689$ 108,123$ 101,863$ 102,774$ 104,363$ 2.5%
144Table of Contents
PARK OPERATIONS (101-45201)
DEPARTMENT: Recreation and Culture SUPERVISOR: Parks Superintendent
ACTIVITY SCOPE:
The park operations activity maintains the parks and trails within the city and at the city’s area
of the Bertram Chain of Lakes Regional Park (BCOL). This includes maintaining and improving
playground and picnic facilities, fertilizing and mowing grass, maintaining athletic fields,
flooding and maintaining outdoor ice rinks, snow and ice removal on pathways, and tree
preservation within the parks system.
OBJECTIVES:
1. Maintain a high-quality parks and trails system.
2. Improve efficiencies through use of the city’s GIS.
3. Complete plan for the Bertram Chain of Lakes Regional Park.
ISSUES:
1. Increase in maintenance costs with acquisition of more park land.
2. Coordination with other entities regarding park use and design.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
increase along with reclassification and increased hours for a recreation coordinator. Supplies
decrease to align more with prior year actual costs for chemical products. Other services &
charges increase to reinstitute pathway maintenance projects in 2024. Capital outlay reflects
the acquisition of capital equipment through the Central Equipment internal service fund.
Measurement 2021 2022 2023 2024
Park land acres maintained 365 365 365 365
Trail miles maintained 42.0 43.0 43.0 45.0
Park events held 100 215 225 245
Winter skating days 120 120 75 45
Full-Time Equivalents 8.85 9.40 9.20 9.55
GENERAL FUND 2021 2022 2023 2023 2024 %
PARK - OPERATIONS Actual Actual Budget Estimated Budget Change
Personnel Services 601,077$ 733,894$ 740,623$ 808,868$ 795,908$ 7.5%
Supplies 197,544 149,105 243,500 208,377 224,999 -7.6%
Other Services & Charges 173,021 210,295 296,933 333,883 409,544 37.9%
Capital Outlay 126,800 141,800 147,700 147,700 145,600 -1.4%
TOTAL EXPENDITURES 1,098,442$ 1,235,093$ 1,428,756$ 1,498,828$ 1,576,051$ 10.3%
145Table of Contents
PARK BALLFIELDS (101-45203)
DEPARTMENT: Recreation and Culture SUPERVISOR: Parks Superintendent
ACTIVITY SCOPE:
The park ballfields activity prepares and maintains city athletic fields, including the NSP (Xcel)
Ballfields.
OBJECTIVES:
1.Prepare and maintain city athletic fields to enhance player and visitor experience.
2.Improve the structures at the ballfields.
ISSUES:
1.Demographic and activity trends.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The 2024 budget is fairly consistent with the budget in prior years. An act of vandalism in 2022
increased Other services & charges. However, the increases expenditures were offset by
insurance claim proceeds.
Measurement 2021 2022 2023 2024
Ball games played, number of 650 650 650 680
Soccer fields maintained 35 24 24 24
Lacrosse fields maintained 10 10 10 12
Ball fields maintained 7 8 12 12
Number of times mowed 50 50 50 50
Full-Time Equivalents 0 0 0 0
GENERAL FUND 2021 2022 2023 2023 2024 %
PARK - BALLFIELDS Actual Actual Budget Estimated Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies 10,126 3,481 10,600 9,791 10,600 0.0%
Other Services & Charges 17,946 56,273 15,600 12,876 18,065 15.8%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 28,072$ 59,754$ 26,200$ 22,666$ 28,665$ 9.4%
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PUBLIC ARTS (101-45204)
DEPARTMENT: Recreation and Culture SUPERVISOR: Parks Superintendent
ACTIVITY SCOPE:
The public arts activity is a focused use of arts and culture as a catalyst for economic and
community development. While art in and of itself can be valuable, the purpose is to harness
the creative energy within the community and channel it into revitalizing downtown and
creating connections between people and community.
OBJECTIVES:
1.Enhance the community aesthetics and revitalize downtown.
2.Engage the community in creating public art.
3.Connect people to the community.
ISSUES:
1.Perception of need.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
Other services and charges include contracting for two creative consultants with increased
participation of the community. Anticipated projects funded through Central Minnesota Arts
Board (CMAB) grants are difficult to predict, however other services & charges expenditures are
budgeted similar to 2023.
Measurement 2021 2022 2023 2024
Public Art Installations 15 32 10 10
City Events Participated In ----6 6
MontiArts Events ----10 12
MontiArts Attendees ----716 825
Programming Events ----261 270
Programming Attendees 45 242 5,234 5,400
*MontiArts data was further developed in 2023 and prior year information is not available.
Full-Time Equivalents 0 0 0 0
GENERAL FUND 2021 2022 2023 2023 2024 %
PARK - PUBLIC ARTS Actual Actual Budget Estimated Budget Change
Personnel Services -$ 222$ -$ 1,442$ -$ ---
Supplies 6,010 14,797 7,200 5,361 7,200 0.0%
Other Services & Charges 87,235 131,264 166,328 147,364 167,703 0.8%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 93,246$ 146,282$ 173,528$ 154,167$ 174,903$ 0.8%
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LIBRARY (101-45501)
DEPARTMENT: Recreation and Culture SUPERVISOR: City Administrator
ACTIVITY SCOPE:
Library services are contracted through the Great River Regional Library System. The city owns
and maintains the library building and provides programs through the library to residents.
OBJECTIVES:
1.Administer quality programs and life-long learning opportunities for residents.
2.Provide access to global information resources.
ISSUES:
1.Maintaining a relevant role in the community.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The city maintains and insures the library building, which requires some maintenance staff
time, but is so minimal that no staff wages are formally allocated to the budget unit. Total 2024
estimated expenditures increase for new carpeting in the building. By state statute, the city
must annually expend at least $35,160 for the library.
Measurement 2021 2022 2023 2024
Checked out items 143,223 138,428 134,747 138,000
Number of requests placed 4,997 4,754 4,992 5,100
Summer reading participants 377 829 891 900
Winter reading participants 55 237 80 150
Patrons using wireless 1,933 2,201 3,239 3,400
Internet sessions used 208 176 283 300
Programs offered 104 133 134 135
Program attendance 1,772 3,317 2,801 3,000
Full-Time Equivalents 0 0 0 0
GENERAL FUND 2021 2022 2023 2023 2024 %
LIBRARY Actual Actual Budget Estimated Budget Change
Personnel Services 1,848$ -$ -$ -$ -$ ---
Supplies 1,517 295 1,500 1,552 1,500 0.0%
Other Services & Charges 41,141 48,106 36,515 40,247 86,479 136.8%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 44,506$ 48,401$ 38,015$ 41,798$ 87,979$ 131.4%
148Table of Contents
SHADE TREE (101-46102)
DEPARTMENT: Recreation and Culture SUPERVISOR: Park Superintendent
ACTIVITY SCOPE:
Shade Tree consists of planting and maintaining trees and shrubbery within the city limits. This
activity provides for regulating, developing, planting, maintaining, and removing of trees in any
street, park, right-of-way, or other public place. Shade trees aid the larger goal of soil
conservation, climate moderation, air quality, and noise reduction. The budget provides the
mechanisms for funding a uniform program for the purpose of beautifying the community as a
whole and increasing property values.
OBJECTIVES:
1. Offer trees for sale for spring tree planting and education for residents.
2. Replace dead and diseased trees throughout the city and parks as part of the Shade
Tree Disease Control Program.
3. Create a boulevard tree planting program.
ISSUES:
1. Funding availability.
2. Managing stress on trees caused by weather and Emerald Ash Borer (EAB) disease.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
A portion of the total time of park employees is allocated to the Shade Tree activity. The 2024
personnel services budget includes a full step increase and a 4.0% market rate wage increase.
Part of the personnel services change reflects the reallocation of wages within recreation and
culture activities to combat EAB, which is offset by a state grant. Supplies budgets increased
with a greater focus on prioritizing new plantings, especially to replace trees infected with EAB.
Measurement 2021 2022 2023 2024
Trees planted 300 75 75 125
Trees removed 25 15 20 60
Students in programs 0 0 0 0
Trees with Emerald Ash Borer --25 45 90
Full-Time Equivalents 0.75 0.90 0.90 0.90
GENERAL FUND 2021 2022 2023 2023 2024 %
SHADE TREE Actual Actual Budget Estimated Budget Change
Personnel Services 74,621$ 70,802$ 96,091$ 75,206$ 105,825$ 10.1%
Supplies 10,824 20,802 33,000 10,250 33,000 0.0%
Other Services & Charges 2,081 2,613 16,616 692 127,897 669.7%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 87,526$ 94,217$ 145,707$ 86,149$ 266,722$ 83.1%
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150Table of Contents
2024 Adopted Budget
Special Revenue Funds
SPECIAL REVENUE FUNDS - SUMMARY
DESCRIPTION
The city currently has three active special revenue funds. Special revenue funds are used to
account for the proceeds of specific revenue sources that are restricted, committed, or
assigned to expenditures for specific purposes other than debt service or capital projects.
Unlike the General Fund, the budgets of special revenue funds do not always balance. Special
revenue funds use the modified accrual basis of accounting for both financial reporting and
budgeting purposes. In 2021, the Economic Development Authority (EDA) Fund was reclassified
from a blended component unit (special revenue fund) to a discretely-presented component
unit in the city’s Annual Comprehensive Financial Report. It was reclassified as such for the first
time in the 2024 budget.
BUDGET SUMMARY
TOTAL SPECIAL REVENUE FUNDS 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CH ANGE
Property Taxes 485,000$ 485,000$ 515,000$ 515,000$ 525,000$ 1.9%
Intergovernmental Revenues 715,000 385,718 400,000 405,396 - -100.0%
Charges for Services 802,030 1,075,625 1,228,300 1,238,054 1,441,100 17.3%
Miscellaneous 36,372 9,575 28,700 102,488 41,900 46.0%
Operating Transfers In - - - - 100,000 ---
TOTAL REVENUES 2,038,402$ 1,955,918$ 2,172,000$ 2,260,939$ 2,108,000$ -2.9%
EXPENDITURES
Personnel Services 792,357$ 1,025,455$ 1,185,518$ 1,204,982$ 1,313,235$ 10.8%
Supplies 56,205 98,508 118,800 174,704 107,000 -9.9%
Other Services & Charges 402,530 667,007 721,682 726,751 668,765 -7.3%
Capital Outlay - 94,019 127,000 59,163 - -100.0%
Operating Transfers Out 425,000 - - - - ---
TOTAL EXPENDITURES 1,676,092$ 1,884,989$ 2,153,000$ 2,165,601$ 2,089,000$ -3.0%
FUND BALANCE - JANUARY 1 1,032,234$ 1,394,544$ 1,465,472$ 1,465,472$ 1,560,810$
Excess (Deficiency) of
Revenues over Expenditures 362,310 70,928 19,000 95,338 19,000
FUND BALANCE - DECEMBER 31 1,394,544$ 1,465,472$ 1,484,472$ 1,560,810$ 1,579,810$
151Table of Contents
CEMETERY FUND (215-49010)
DEPARTMENT: Recreation and Culture SUPERVISOR: Parks Superintendent
ACTIVITY SCOPE:
The Cemetery Fund sustains itself with revenues from plot sales and from services, such as
excavations, staking for monuments, memorial programs, and perpetual care. The city
maintains two cemeteries: Riverside and Hillside. Staff assist customers/visitors with
memorials and perpetual care for both. Hillside cemetery is no longer open to burial, and
expenditures are recorded through park operations in the General Fund. An ossuary-
columbarium was purchased in 2019, which is also accounted for in this fund.
OBJECTIVES:
1.Provide the public with a way to memorialize loved ones after passing away in a
courteous, professional manner.
2.Maintain and beautiful and comforting environment on cemetery grounds and
around grave markers.
ISSUES:
1.Increasing maintenance costs.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Plots occupied 3,626 3,650 3,670 3,675
Plots reserved 613 645 663 700
Plots available for sale 1,136 1,093 1,086 1,030
Number of plots sold 23 32 18 32
Number of internments 28 25 19 25
Number of markers staked 9 17 18 20
Columbarium slots occupied 9 16 11 20
Columbarium slots reserved 3 8 20 10
Columbarium slots available 84 80 75 75
Columbarium slots sold 4 6 5 5
Ossuary slots occupied 0 3 4 5
Ossuary slots reserved 50 52 47 55
Ossuary slots available 269 267 272 264
Ossuary slots sold 0 2 0 2
Full-Time Equivalents 0 0 0 0
152Table of Contents
BUDGET:
BUDGET COMMENTARY:
Sales of burial plots and ossuary-columbarium slot remain consistent with prior years but are
budgeted conservatively. A rebound in the city’s investment portfolio created positive
miscellaneous revenues, which are mostly comprised of interest earnings. While there are no
city employees specifically dedicated to the Cemetery function, the parks department staff
sometimes perform tasks which are allocated to this fund.
CEMETERY 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Charges for Services 53,891$ 67,838$ 41,700$ 43,727$ 41,700$ 0.0%
Miscellaneous (282) (3,518) 300 10,645 300 0.0%
TOTAL REVENUES 53,609$ 64,320$ 42,000$ 54,371$ 42,000$ 0.0%
EXPENDITURES
Personnel Services 3,628$ 386$ 2,228$ -$ 2,228$ 0.0%
Supplies 1,314 106 1,100 217 1,100 0.0%
Other Services & Charges 23,823 26,169 27,672 23,786 27,672 0.0%
TOTAL EXPENDITURES 28,764$ 26,660$ 31,000$ 24,003$ 31,000$ 0.0%
FUND BALANCE - JANUARY 1 55,339$ 80,184$ 117,844$ 117,844$ 148,212$
Excess (Deficiency) of
Revenues over Expenditures 24,845 37,660 11,000 30,368 11,000
FUND BALANCE - DECEMBER 31 80,184$ 117,844$ 128,844$ 148,212$ 159,212$
153Table of Contents
SMALL CITIES DEVELOPMENT PROGRAM (SCDP) FUND (221-46500)
DEPARTMENT: Small Cities Development Program Fund SUPERVISOR: Community Development Director
ACTIVITY SCOPE:
Following state and federal guidelines, the SCDP Fund administers loans to local businesses.
OBJECTIVES:
1.Match available funds with qualifying businesses in Monticello.
ISSUES:
1.Number of qualified businesses in Monticello.
2.Loan program and bank requirements.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
Repayment of loans and interest earned on investments make up the anticipated activity in
2024. A rebound in the city’s investment portfolio created positive miscellaneous revenues in
2023, which are comprised of interest earnings on investments and outstanding loans.
Measurement 2021 2022 2023 2024
Loans outstanding 1 1 1 1
Loans originated 0 0 0 1
Full-Time Equivalents 0 0 0 0
SCDP FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CH ANGE
Miscellaneous 84$ (26,413)$ 8,000$ 41,305$ 8,000$ 0.0%
FUND BALANCE - JANUARY 1 924,538$ 924,622$ 898,209$ 898,209$ 939,514$
Excess (Deficiency) of
Revenues over Expenditures 84 (26,413) 8,000 41,305 8,000
FUND BALANCE - DECEMBER 31 924,622$ 898,209$ 906,209$ 939,514$ 947,514$
154Table of Contents
COMMUNITY CENTER FUND (226-4512x)
DEPARTMENT: Community Center SUPERVISOR: Parks, Arts & Recreation Director
ACTIVITY SCOPE:
The Monticello Community Center (MCC) provides space for a variety of recreational,
professional, and educational opportunities. Expenditures for the community center are
divided into six activities: administration, rentals and events, aquatics, guest services and
concessions, maintenance, and programming.
OBJECTIVES:
1.Repurpose the area previously used as a wheel park (skateboard, bike, and
rollerblade) including design, financing, construction, and marketing.
2.Develop an online registration system for program and membership sign up.
3.Invest in facility improvements to increase customers.
4.Improve financial controls and budget management.
ISSUES:
1.Limitations to facility size and parking availability.
2.Competition from other fitness facilities.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Gross program sales 44,937$ 62,485$ 50,276$ 73,000$
Facility rental revenue 136,722$ 183,114$ 187,166$ 237,600$
Annual memberships 343 416 349 359
Monthly memberships 843 1,166 1,366 1,407
Three-month memberships 153 186 203 209
Ratio of annual memberships
to other memberships 0.34 0.31 0.22 0.22
Full-Time Equivalents 13.4 18.05 20.75 22.25
155Table of Contents
BUDGET:
BUDGET COMMENTARY:
The MCC’s largest revenue sources are charges for services (memberships and day passes) and
property taxes, and an operating transfer in from the Deputy Registrar Fund. The city was
awarded $1.5 million in American Rescue Plan Act (ARPA) funding in 2021 through 2023, which
was all used in the Community Center Fund for wages and benefits while memberships
bounced back after declining significantly during the COIVD-19 pandemic.
With some uncertainty over how inflation will affect user habits, the 2024 budget is
conservative in estimating revenues and liberal in estimating potential costs. Capital
expenditures were halted when the pandemic began and were delayed to conserve resources.
However, in thinking long-term, methodical investments in the facility to engage patrons began
again in 2022. Beginning in 2024, the city will finance certain capital investments in the facility
out of the Capital Projects Fund in the interest of consistency with other city facilities.
COMMUNITY CENTER 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 485,000$ 485,000$ 515,000$ 515,000$ 525,000$ 1.9%
Intergovernmental Revenues 715,000 385,718 400,000 405,396 - -100.0%
Charges for Services 748,139 1,007,787 1,186,600 1,194,328 1,399,400 17.9%
Miscellaneous 36,570 39,506 20,400 50,539 33,600 64.7%
Operating Transfers In - - - - 100,000 ---
TOTAL REVENUES 1,984,709$ 1,918,010$ 2,122,000$ 2,165,263$ 2,058,000$ -3.0%
EXPENDITURES
Personnel Services 788,729$ 1,025,069$ 1,183,290$ 1,204,982$ 1,311,007$ 10.8%
Supplies 54,891 98,403 117,700 174,487 105,900 -10.0%
Other Services & Charges 378,708 640,838 694,010 702,965 641,093 -7.6%
Capital Outlay - 94,019 127,000 59,163 - -100.0%
Operating Transfers Out 425,000 - - - - ---
TOTAL EXPENDITURES 1,647,328$ 1,858,329$ 2,122,000$ 2,141,597$ 2,058,000$ -3.0%
FUND BALANCE - JANUARY 1 52,357$ 389,738$ 449,419$ 449,419$ 473,085$
Excess (Deficiency) of
Revenues over Expenditures 337,381 59,682 - 23,665 -
FUND BALANCE - DECEMBER 31 389,738$ 449,419$ 449,419$ 473,085$ 473,085$
156Table of Contents
2024 Adopted Budget
Debt Service Funds
DEBT SERVICE FUNDS - SUMMARY
DESCRIPTION
Debt services funds are used to account for the accumulation of resources for the payment of
general long-term debt, excluding debt issued by an enterprise or internal service fund. Debt
service funds use the modified accrual basis of accounting for both financial reporting and
budgeting purposes. The city has six active debt service (sub)funds that are combined into one
debt service fund for financial reporting.
The city's bond rating was downgraded from Aa3 to A2 by Moody's Investor Services in 2012.
This rating was upgraded to A1 with the sale of the city’s 2019A debt issue in 2019 and further
upgraded to Aa3 in 2023. Fund balances in some (sub)funds declined with planned use of fund
balances built up over time due to items such as prepaid assessments.
BUDGET SUMMARY
TOTAL DEBT SERVICE FUNDS 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 2,831,479$ 2,311,400$ 1,999,581$ 1,999,581$ 2,026,175$ 1.3%
Special Assessments 272,950 317,270 259,275 300,189 244,579 -5.7%
Miscellaneous (7,195) (53,739) 9,144 60,042 9,246 1.1%
Operating Transfers In 3,975,238 197,925 - - - ---
TOTAL REVENUES 7,072,472$ 2,772,856$ 2,268,000$ 2,359,812$ 2,280,000$ 0.5%
EXPENDITURES
Other Services & Charges 8,850$ 7,250$ 1,200$ 3,000$ 3,000$ 150.0%
Debt Service 7,243,944 2,806,708 2,605,800 2,603,183 2,603,000 -0.1%
Operating Transfers Out - 108,801 - - - ---
TOTAL EXPENDITURES 7,252,794$ 2,922,759$ 2,607,000$ 2,606,183$ 2,606,000$ 0.0%
FUND BALANCE - JANUARY 1 1,304,532$ 1,124,210$ 974,307$ 974,307$ 727,936$
Excess (Deficiency) of
Revenues over Expenditures (180,322) (149,903) (339,000) (246,371) (326,000)
FUND BALANCE - DECEMBER 31 1,124,210$ 974,307$ 635,307$ 727,936$ 401,936$
157Table of Contents
2015B G.O. BOND SUB-FUND (319-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The 2015B G.O. Street Reconstruction and Improvement Bonds provided financing for School
Boulevard, Fallon Avenue, and 85th Street improvements. This issue also provided financing for
street and other infrastructure improvements in the area east of Highway 25 and north of
Interstate 94. The city levies for the gap between annual debt service payments and annual
assessment collections. The bonds have an average interest rate of 2.5856% and were
redeemable in December of 2022.
OBJECTIVES:
1. Make scheduled debt payments in a timely manner.
2. Redeem or refund when feasible.
ISSUES:
1. Balancing the property tax levy for this bond with the needs of other debt.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2021 2022 2023 2024
Assessment balance $68,780 $51,585 $34,390 $17,195
Delinquent balance $0 $10,403 $0 $0
Prepaid assessments $4,629 $0 $0 $0
Assessment rolls 2 1 1 1
Assessed parcels 28 1 1 1
2015B G.O. Bonds 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 201,115$ 192,650$ 164,435$ 164,435$ 165,223$ 0.5%
Special Assessments 27,767 10,403 19,903 31,242 19,000 -4.5%
Miscellaneous (785) (6,508) 1,662 7,289 1,777 6.9%
TOTAL REVENUES 228,097$ 196,545$ 186,000$ 202,966$ 186,000$ 0.0%
EXPENDITURES
Other Services & Charges 357$ 417$ 200$ 500$ 500$ 150.0%
Debt Service 213,550 210,300 212,800 212,000 213,500 0.3%
TOTAL EXPENDITURES 213,907$ 210,717$ 213,000$ 212,500$ 214,000$ 0.5%
FUND BALANCE - JANUARY 1 121,687$ 135,877$ 121,706$ 121,706$ 112,172$
Excess (Deficiency) of
Revenues over Expenditures 14,190 (14,171) (27,000) (9,534) (28,000)
FUND BALANCE - DECEMBER 31 135,877$ 121,706$ 94,706$ 112,172$ 84,172$
158Table of Contents
BUDGET COMMENTARY:
The $2,605,000 2015B G.O. bond issue has two components: $1,885,000 street reconstruction
portion and $720,000 improvement portion. Property taxes support the reconstruction portion
of the debt issue. The improvement portion is supported by a single assessment of $175,000 on
school district property and property taxes. The tax levy covers the gap between assessment
revenue and debt service payments. Developer fees were assessed to platted parcels in 2021
causing an increase in assessment rolls and assessed parcels related to the bond issue.
REMAINING DEBT SERVICE:
Payable Principal Interest Rate Total
6/15/2024 -$ 18,600$ 18,600$
12/15/2024 175,000 18,600 2.50% 193,600
6/15/2025 - 16,413 16,413
12/15/2025 180,000 16,413 2.50% 196,413
6/15/2026 - 14,162 14,162
12/15/2026 185,000 14,162 2.50% 199,162
6/15/2027 - 11,850 11,850
12/15/2027 185,000 11,850 3.00% 196,850
6/15/2028 - 9,075 9,075
12/15/2028 195,000 9,075 3.00% 204,075
6/15/2029 - 6,150 6,150
12/15/2029 200,000 6,150 3.00% 206,150
6/15/2030 - 3,150 3,150
12/15/2030 210,000 3,150 3.00% 213,150
Total 1,330,000$ 158,800$ 1,488,800$
GO Bonds, Series 2015B
159Table of Contents
2016A G.O. BOND SUB-FUND (320-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The 2016A G.O. Street Reconstruction and Improvement Bonds financed improvements
included in the 2016 core street project and at the intersection of Highway 25 and 7th Street.
The city levies for the gap between annual debt service payments and annual assessment
collections. The bonds have an average interest rate of 2.1034% and were redeemable in
December of 2023.
OBJECTIVES:
1.Make scheduled debt payments in a timely manner.
2.Redeem or refund when feasible.
ISSUES:
1.Balancing the property tax levy for this bond with the needs of other debt.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2021 2022 2023 2024
Assessment balance $316,688 $246,567 $182,753 $120,291
Delinquent balance $0 $77 $177 $0
Prepaid assessments $9,621 $7,209 $2,703 $0
Assessment rolls 2 2 2 2
Assessed parcels 76 66 64 64
2016A G.O. Bonds 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 406,089$ 406,929$ 282,559$ 282,559$ 357,979$ 26.7%
Special Assessments 91,510 83,117 73,063 73,894 68,528 -6.2%
Miscellaneous (2,525) (17,733) 1,378 16,278 1,493 8.3%
TOTAL REVENUES 495,074$ 472,313$ 357,000$ 372,731$ 428,000$ 19.9%
EXPENDITURES
Other Services & Charges 357$ 417$ 200$ 500$ 500$ 150.0%
Debt Service 526,000 526,850 527,800 527,450 528,500 0.1%
TOTAL EXPENDITURES 526,357$ 527,267$ 528,000$ 527,950$ 529,000$ 0.2%
FUND BALANCE - JANUARY 1 399,967$ 368,684$ 313,731$ 313,731$ 158,512$
Excess (Deficiency) of
Revenues over Expenditures (31,283) (54,954) (171,000) (155,219) (101,000)
FUND BALANCE - DECEMBER 31 368,684$ 313,731$ 142,731$ 158,512$ 57,512$
160Table of Contents
BUDGET COMMENTARY:
The $4,900,000 2016A G.O. bond issue has two components: $770,000 street reconstruction
portion and $4,130,000 improvement portion. Property taxes support the reconstruction
portion of the debt issue. The improvement portion is supported by assessments of $1,143,000
in the core street reconstruction area. Property taxes are levied for the gap between
assessment revenue and debt service payments. Future levies will be adjusted to reflect
assessment prepayments, interest earned on the prepayments and interest foregone on the
prepayments.
REMAINING DEBT SERVICE:
Payable Principal Interest Rate Total
6/15/2024 -$ 18,675$ 18,675$
12/15/2024 490,000 18,675 2.00% 508,675
6/15/2025 - 13,775 13,775
12/15/2025 500,000 13,775 2.00% 513,775
6/15/2026 - 8,775 8,775
12/15/2026 510,000 8,775 2.00% 518,775
6/15/2027 - 3,675 3,675
12/15/2027 60,000 3,675 3.00% 63,675
6/15/2028 - 2,775 2,775
12/15/2028 60,000 2,775 3.00% 62,775
6/15/2029 - 1,875 1,875
12/15/2029 60,000 1,875 3.00% 61,875
6/15/2030 - 975 975
12/15/2030 65,000 975 3.00% 65,975
Total 1,745,000$ 101,050$ 1,846,050$
GO Bonds, Series 2016A
161Table of Contents
2017A G.O. BOND SUB-FUND (321-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The 2017A G.O. Improvement and Abatement Bonds financed improvements to rural outlying
roads and various other city street projects. Additionally, the issue provided funding for Fallon
Avenue overpass right-of-way acquisition, engineering, and construction. The bonds have an
average interest rate of 2.443% and are redeemable in December of 2026.
OBJECTIVES:
1.Make scheduled debt payments in a timely manner.
2.Redeem or refund when feasible.
ISSUES:
1.Balancing the property tax levy for this bond with the needs of other debt.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2021 2022 2023 2024
Assessment balance $191,502 $150,373 $118,456 $87,767
Delinquent balance $0 $51 $1,046 $0
Prepaid assessments $2,763 $9,211 $1,842 $0
Assessment rolls 2 2 2 2
Assessed parcels 57 52 51 51
2017A G.O. Bonds 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 430,097$ 427,367$ 299,532$ 299,532$ 326,842$ 9.1%
Special Assessments 46,859 49,837 39,098 38,221 35,488 -9.2%
Miscellaneous (1,788) (13,567) 1,370 13,879 1,670 21.9%
TOTAL REVENUES 475,168$ 463,637$ 340,000$ 351,632$ 364,000$ 7.1%
EXPENDITURES
Other Services & Charges 357$ 417$ 200$ 500$ 500$ 150.0%
Debt Service 472,390 469,840 467,800 467,140 469,500 0.4%
TOTAL EXPENDITURES 472,747$ 470,257$ 468,000$ 467,640$ 470,000$ 0.4%
FUND BALANCE - JANUARY 1 278,557$ 280,978$ 274,359$ 274,359$ 158,350$
Excess (Deficiency) of
Revenues over Expenditures 2,421 (6,619) (128,000) (116,008) (106,000)
FUND BALANCE - DECEMBER 31 280,978$ 274,359$ 146,359$ 158,350$ 52,350$
162Table of Contents
BUDGET COMMENTARY:
The $5,000,000 2017A G.O. bond issue has two components: $2,040,000 improvement portion
and $2,960,000 abatement portion. Property taxes and assessments support the improvement
portion of the debt issue. The abatement portion is supported by a tax abatement levy for bond
principal and a debt service levy for bond interest. Property taxes will be levied for any gap
between assessment revenue and debt service.
REMAINING DEBT SERVICE:
Payable Principal Interest Rate Total
6/15/2024 -$ 34,420$ 34,420$
12/15/2024 400,000 34,420 2.00% 434,420
6/15/2025 - 30,420 30,420
12/15/2025 410,000 30,420 2.00% 440,420
6/15/2026 - 26,320 26,320
12/15/2026 420,000 26,320 2.50% 446,320
6/15/2027 - 21,069 21,069
12/15/2027 430,000 21,069 2.50% 451,069
6/15/2028 - 15,695 15,695
12/15/2028 210,000 15,695 2.50% 225,695
6/15/2029 - 13,070 13,070
12/15/2029 215,000 13,070 2.60% 228,070
6/15/2030 - 10,275 10,275
12/15/2030 220,000 10,275 3.00% 230,275
6/15/2031 - 6,975 6,975
12/15/2031 230,000 6,975 3.00% 236,975
6/15/2032 - 3,525 3,525
12/15/2032 235,000 3,525 3.00% 238,525
Total 2,770,000$ 323,538$ 3,093,538$
GO Bonds, Series 2017A
163Table of Contents
2018A G.O. ABATEMENT BOND SUB-FUND (322-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The 2018A G.O. Abatement Bonds provided $5,000,000 of funding for Fallon Avenue overpass
right-of-way acquisition, engineering, and construction. The bonds have an average interest
rate of 3.151% and are redeemable in December of 2026. Abatement bonds were also issued
in 2017 and 2019 for the remaining costs on the overpass project. All three abatement issues
(2017, 2018, and 2019) have the same redemption date and term, with the last payment
occurring in 2032.
OBJECTIVES:
1.Make scheduled debt payments in a timely manner.
2.Redeem or refund when feasible.
ISSUES:
1.Balancing the property tax levy for this bond with the needs of other debt.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The $5,000,000 2018A G.O. bond issue has only one component: Abatement. A debt service
levy covers the annual bond interest payment, and a tax abatement levy covers the annual
bond principal payment.
Measurement 2021 2022 2023 2024
Not Applicable
2018A G.O. Bonds 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 448,077$ 451,812$ 444,232$ 444,232$ 439,337$ -1.1%
Miscellaneous (648) (5,361) 1,768 6,055 1,663 -5.9%
TOTAL REVENUES 447,429$ 446,451$ 446,000$ 450,287$ 441,000$ -1.1%
EXPENDITURES
Other Services & Charges 357$ 417$ 200$ 500$ 500$ 150.0%
Debt Service 446,288 447,038 447,800 447,438 447,500 -0.1%
TOTAL EXPENDITURES 446,645$ 447,454$ 448,000$ 447,938$ 448,000$ 0.0%
FUND BALANCE - JANUARY 1 79,719$ 80,503$ 79,500$ 79,500$ 81,849$
Excess (Deficiency) of
Revenues over Expenditures 784 (1,003) (2,000) 2,350 (7,000)
FUND BALANCE - DECEMBER 31 80,503$ 79,500$ 77,500$ 81,849$ 74,849$
164Table of Contents
REMAINING DEBT SERVICE:
Payable Principal Interest Rate Total
6/15/2024 -$ 53,494$ 53,494$
12/15/2024 340,000 53,494 3.00% 393,494
6/15/2025 - 48,394 48,394
12/15/2025 350,000 48,394 3.00% 398,394
6/15/2026 - 43,143 43,143
12/15/2026 360,000 43,143 3.00% 403,143
6/15/2027 - 37,744 37,744
12/15/2027 370,000 37,744 3.00% 407,744
6/15/2028 - 32,194 32,194
12/15/2028 385,000 32,194 3.00% 417,194
6/15/2029 - 26,419 26,419
12/15/2029 395,000 26,419 3.00% 421,419
6/15/2030 - 20,494 20,494
12/15/2030 405,000 20,494 3.13% 425,494
6/15/2031 - 14,165 14,165
12/15/2031 420,000 14,165 3.25% 434,165
6/15/2032 - 7,341 7,341
12/15/2032 435,000 7,341 3.38% 442,341
Total 3,460,000$ 566,776$ 4,026,776$
GO Bonds, Series 2018A Abatement Bonds
165Table of Contents
2019A G.O. BOND SUB-FUND (323-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The 2019A bonds financed the completion of the Fallon Avenue overpass (abatement bonds),
purchase of a fire ladder truck, construction of a new fire hall, and street improvements. The
bonds have an average interest rate of 2.0825% and are redeemable in December of 2027. All
three abatement bond issues (2017, 2018, and 2019) have the same redemption date and
term with the last payment occurring in 2032.
OBJECTIVES:
1.Make scheduled debt payments in a timely manner.
2.Redeem or refund when feasible.
ISSUES:
1.Balancing the property tax levy for this bond with the needs of other debt.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2021 2022 2023 2024
Assessment balance $71,610 $61,380 $51,150 $40,920
Delinquent balance $0 $0 $0 $0
Prepaid assessments $0 $0 $0 $0
Assessment rolls 1 1 1 1
Assessed parcels 9 9 9 9
2019A GO BONDS 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 714,945$ 709,446$ 697,133$ 697,133$ 711,964$ 2.1%
Special Assessments 14,322 13,811 13,299 13,299 12,787 -3.8%
Miscellaneous (536) (5,948) 1,568 6,684 1,249 -20.3%
TOTAL REVENUES 728,731$ 717,309$ 712,000$ 717,116$ 726,000$ 2.0%
EXPENDITURES
Other Services & Charges 4,357$ 417$ 200$ 500$ 500$ 150.0%
Debt Service 714,088 717,938 711,800 711,438 710,500 -0.2%
TOTAL EXPENDITURES 718,445$ 718,354$ 712,000$ 711,938$ 711,000$ -0.1%
FUND BALANCE - JANUARY 1 39,494$ 49,780$ 48,734$ 48,734$ 53,913$
Excess (Deficiency) of
Revenues over Expenditures 10,286 (1,046) - 5,179 15,000
FUND BALANCE - DECEMBER 31 49,780$ 48,734$ 48,734$ 53,913$ 68,913$
166Table of Contents
BUDGET COMMENTARY:
The 2019A G.O. Bonds are comprised of four components: $1,040,000 abatement, $1,290,000
equipment, $5,350,000 CIP, and $320,000 street improvement. The revenue sources include a
combination of taxes and special assessments.
REMAINING DEBT SERVICE:
Payable Principal Interest Rate Total
6/15/2024 -$ 59,643$ 59,643$
12/15/2024 590,000 59,643 2.00% 649,643
6/15/2025 - 53,744 53,744
12/15/2025 605,000 53,744 2.00% 658,744
6/15/2026 - 47,694 47,694
12/15/2026 615,000 47,694 2.00% 662,694
6/15/2027 - 41,544 41,544
12/15/2027 630,000 41,544 2.00% 671,544
6/15/2028 - 35,244 35,244
12/15/2028 645,000 35,244 2.00% 680,244
6/15/2029 - 28,793 28,793
12/15/2029 455,000 28,793 2.00% 483,793
6/15/2030 - 24,244 24,244
12/15/2030 465,000 24,244 2.00% 489,244
6/15/2031 - 19,593 19,593
12/15/2031 475,000 19,593 2.10% 494,593
6/15/2032 - 14,606 14,606
12/15/2032 485,000 14,606 2.20% 499,606
6/15/2033 - 9,271 9,271
12/15/2033 405,000 9,271 2.25% 414,271
6/15/2034 - 4,715 4,715
12/15/2034 410,000 4,715 2.30% 414,715
Total 5,780,000$ 678,182$ 6,458,182$
GO Bonds, Series 2019A
167Table of Contents
2020A G.O. BOND SUB-FUND (324-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The 2020A bonds financed the 2020 and 2022 Street Improvement projects. The revenue
sources include property taxes and special assessments. The city levies for the gap between
annual debt service payments and annual assessment collections. The bonds have an average
interest rate of 1.5067% and are redeemable in December of 2028.
OBJECTIVES:
1.Make scheduled debt payments in a timely manner.
2.Redeem or refund when feasible.
ISSUES:
1.Balancing the property tax levy for this bond with the needs of other debt.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2021 2022 2023 2024
Assessment balance $435,493 $760,471 $649,901 $567,717
Delinquent balance $0 $930 $2,427 $0
Prepaid assessments $20,799 $96,838 $25,429 $0
Assessment rolls 1 2 2 2
Assessed parcels 251 437 420 420
2020A GO BONDS 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 117,586$ 123,196$ 111,690$ 111,690$ 24,830$ -77.8%
Special Assessments 92,491 160,103 113,912 143,533 108,776 -4.5%
Miscellaneous (836) (4,623) 1,398 9,857 1,394 -0.3%
TOTAL REVENUES 209,241$ 278,675$ 227,000$ 265,079$ 135,000$ -40.5%
EXPENDITURES
Other Services & Charges 357$ 4,417$ 200$ 500$ 500$ 150.0%
Debt Service 234,982 236,818 237,800 237,718 233,500 -1.8%
TOTAL EXPENDITURES 235,339$ 241,234$ 238,000$ 238,218$ 234,000$ -1.7%
FUND BALANCE - JANUARY 1 124,934$ 98,836$ 136,277$ 136,277$ 163,139$
Excess (Deficiency) of
Revenues over Expenditures (26,098) 37,441 (11,000) 26,862 (99,000)
FUND BALANCE - DECEMBER 31 98,836$ 136,277$ 125,277$ 163,139$ 64,139$
168Table of Contents
BUDGET COMMENTARY:
The city issued the $2,155,000 2020A G.O. Bonds to finance the 2020 and 2022 Street
Improvement projects. Property taxes and special assessments also support debt service
payments. Expenditures consist of principal and interest payments and fiscal agent fees.
REMAINING DEBT SERVICE:
Payable Principal Interest Rate Total
6/15/2024 -$ 11,509$ 11,509$
12/15/2024 210,000 11,509 2.00% 221,509
6/15/2025 - 9,409 9,409
12/15/2025 215,000 9,409 0.45% 224,409
6/15/2026 - 8,925 8,925
12/15/2026 215,000 8,925 2.00% 223,925
6/15/2027 - 6,775 6,775
12/15/2027 220,000 6,775 2.00% 226,775
6/15/2028 - 4,575 4,575
12/15/2028 225,000 4,575 2.00% 229,575
6/15/2029 - 2,325 2,325
12/15/2029 230,000 2,325 1.00% 232,325
6/15/2030 - 1,175 1,175
12/15/2030 235,000 1,175 1.00% 236,175
Total 1,550,000$ 89,385$ 1,639,385$
GO Bonds, Series 2020A
169Table of Contents
CLOSED DEBT SERVICE FUNDS
CLOSED FUNDS PRESENTED:
• 2011A G.O. Refunding Bond Sub-Fund (312-47000)
• 2014A G.O. Judgement Bond Sub-Fund (318-47000)
CLOSED FUNDS BUDGETS:
2011A G.O. BOND FUND (2005A)2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Miscellaneous (76) - - - - ---
Operating Transfers In 198,700 197,925 - - - ---
TOTAL REVENUES 198,624$ 197,925$ -$ -$ -$ ---
EXPENDITURES
Other Services & Charges 1,357$ 750$ -$ -$ -$ ---
Debt Service 199,175 197,925 - - - ---
Operating Transfers Out - 108,802 - - - ---
TOTAL EXPENDITURES 200,532$ 307,477$ -$ -$ -$ ---
FUND BALANCE - JANUARY 1 111,460$ 109,552$ -$ -$ -$
Excess (Deficiency) of
Revenues over Expenditures (1,908) (109,552)$ - - -
FUND BALANCE - DECEMBER 31 109,552$ -$ -$ -$ -$
2014A G.O. JUDGMENT BONDS 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 513,570$ -$ -$ -$ -$ ---
Operating Transfers In 3,776,538 - - - - ---
TOTAL REVENUES 4,290,108$ -$ -$ -$ -$ ---
EXPENDITURES
Other Services & Charges 1,350$ -$ -$ -$ -$ ---
Debt Service 4,437,472 - - - - ---
TOTAL EXPENDITURES 4,438,822$ -$ -$ -$ -$ ---
FUND BALANCE - JANUARY 1 148,714$ -$ -$ -$ -$
Excess (Deficiency) of
Revenues over Expenditures (148,714)$ - - - -
FUND BALANCE - DECEMBER 31 -$ -$ -$ -$ -$
170Table of Contents
2024 Adopted Budget
Capital Project Funds
CAPITAL PROJECT FUNDS - SUMMARY
DESCRIPTION
Capital project funds are used to account for financial resources that are restricted, committed,
or assigned to expenditure for capital outlays including the acquisition or construction of capital
facilities and other capital assets—excluding capital assets financed by proprietary funds
(enterprise or internal service). Capital project funds use the modified accrual basis of
accounting for both financial reporting and budgeting purposes. The city currently has four
active capital project funds. Financing capital asset additions or replacements has been an
ongoing challenge, especially in a city with a growing population while also having its largest
property taxpayer either losing value or growing in value at a lower rate than other properties
within the city. This causes volatile fluctuations in taxes paid in relation to the city’s tax levy.
Capital projects are one area that can be used to help offset large tax swings to residents and
businesses.
BUDGET SUMMARY
TOTAL CAPITAL PROJECTS FUNDS 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CH ANGE
Property Taxes 647,085$ 1,153,476$ 1,475,419$ 1,475,419$ 1,882,825$ 27.6%
Franchise & Other Taxes 189,460 161,384 190,000 157,109 175,000 -7.9%
Intergovernmental Revenues 2,571,685 746,684 1,559,500 55,000 3,766,513 141.5%
Charges for Services 23,492 171,697 - 50,247 - ---
Special Assessments 1,425,724 401,086 128,549 885,286 106,419 -17.2%
Miscellaneous (115,492) (546,742) 186,532 677,603 85,243 -54.3%
Contributed Capital 393,451 7,088 - 2,409,594 - ---
Operating Transfers In 3,201,427 108,801 4,000,000 4,750,000 1,000,000 -75.0%
Debt Proceeds - - 5,000,000 - 30,000,000 500.0%
TOTAL REVENUES 8,336,831$ 2,203,475$ 12,540,000$ 10,460,257$ 37,016,000$ 195.2%
EXPENDITURES
Other Services & Charges 100,814$ 294,687$ -$ 45,171$ 35,000$ ---
Capital Outlay 7,304,615 2,616,780 15,375,000 11,784,428 43,267,000 181.4%
Debt Service - 500 - - - ---
Operating Transfers Out 7,326,621 - - - - ---
TOTAL EXPENDITURES 14,732,050$ 2,911,967$ 15,375,000$ 11,829,599$ 43,302,000$ 181.6%
FUND BALANCE - JANUARY 1 20,538,658$ 14,143,440$ 13,434,947$ 13,434,947$ 12,065,606$
Excess (Deficiency) of
Revenues over Expenditures (6,395,219) (708,492) (2,835,000) (1,369,342) (6,286,000)
FUND BALANCE - DECEMBER 31 14,143,440$ 13,434,947$ 10,599,947$ 12,065,606$ 5,779,606$
171Table of Contents
CAPITAL PROJECT FUND (400-4xxxx)
DEPARTMENT: Capital Project Fund SUPERVISOR: City Engineer/Public Works Director
ACTIVITY SCOPE:
The Capital Project Fund is a generic fund of the same type used to account for capital asset
construction and acquisitions. Capital assets accounted for in this fund include street
improvements and other infrastructure and buildings.
OBJECTIVES:
1. Maintain and perform upgrades or replacements to existing city infrastructure.
2. Extend city infrastructure to new developments.
3. Acquire large, non-proprietary fund, capital equipment (e.g. fire ladder truck) that the
Central Equipment internal service fund cannot support.
ISSUES:
1. Funding growth and replacement improvements in a stable debt and property tax levy
environment.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2021 2022 2023 2024
Projects supported 5 9 7 7
CAPITAL PROJECT FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 647,085$ 1,153,476$ 1,475,419$ 1,475,419$ 1,882,825$ 27.6%
Intergovernmental Revenues 2,571,685 596,684 1,087,000 55,000 3,766,513 246.5%
Charges for Services 23,492 26,865 - - - ---
Special Assessments 667,337 400,235 127,734 884,471 105,640 -17.3%
Miscellaneous (95,521) (459,246) 174,847 541,854 75,022 -57.1%
Contributed Capital 393,451 7,088 - 2,409,594 - ---
Operating Transfers In 2,088,430 108,801 2,750,000 3,500,000 1,000,000 -63.6%
Debt Proceeds - - 5,000,000 - 30,000,000 500.0%
TOTAL REVENUES 6,295,959$ 1,833,904$ 10,615,000$ 8,866,337$ 36,830,000$ 247.0%
EXPENDITURES
Other Services & Charges 100,814$ 294,187$ -$ 37,501$ 35,000$ ---
Capital Outlay 6,599,533 2,533,085 11,870,000 10,317,896 41,750,000 251.7%
Debt Service - 500 - - - ---
Operating Transfers Out 3,976,538 - - - - ---
TOTAL EXPENDITURES 10,676,885$ 2,827,772$ 11,870,000$ 10,355,397$ 41,785,000$ 252.0%
FUND BALANCE - JANUARY 1 16,243,546$ 11,862,620$ 10,868,752$ 10,868,752$ 9,379,693$
Excess (Deficiency) of
Revenues over Expenditures (4,380,926) (993,868) (1,255,000) (1,489,059) (4,955,000)
FUND BALANCE - DECEMBER 31 11,862,620$ 10,868,752$ 9,613,752$ 9,379,693$ 4,424,693$
172Table of Contents
BUDGET COMMENTARY:
Lower required debt service levies have created capacity for the capital projects fund to levy
about $400,000 more than it previously could in previous years. The 2024 property tax levy
reduces the need for future debt and stabilizes the overall levy to accommodate future debt.
Intergovernmental revenues of $2.1 million were received in 2021 but are related to the Fallon
Avenue Overpass project that was completed in 2018. The 2021 transfer in is from the closure
of the Closed Bond fund, which had previously been presented in conjunction with the Capital
Projects fund in the city’s ACFR, so the funds were combined in 2021. 2023 transfers are from
the Liquor and Deputy Registrar funds for the improvement project in Monticello’s core
downtown. Contributed capital in 2023 was the County’s portion of the costs for improvements
to Broadway West as part of the Downtown Pedestrian & Roadways Improvements Project.
Budgeted debt proceeds will be used to fund the design and construction of a new Public
Works Facility with additional debt potentially to be issued in 2025.
For 2024, notable projects include: Downtown Pedestrian & Roadways Improvements, a new
Public Works Facility, School Boulevard Roundabouts & Reconstruction, Broadway East
Transportation Improvements, 7th Street Retaining Wall Replacement & Sidewalk Installation,
design for further Country Road 39 West Pedestrian Improvements, and design for site work at
the Community Center. Some funding is budgeted to come from fund balance.
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STREET LIGHTING IMPROVEMENT FUND (403-43162)
DEPARTMENT: Public Works SUPERVISOR: City Engineer/Public Works Director
ACTIVITY SCOPE:
The Street Lighting Improvement Fund provides resources for improvements to the street
lighting system. Electric franchise fees are the fund’s primary revenue sources.
OBJECTIVES:
1.Upgrade traditional lights to colonial style lights.
2.Collaborate with MNDOT to add battery back-up to signals on TH25.
3.Replace and modify lighting system in the downtown area.
4.Add lighting for pathways and other high use areas.
ISSUES:
1.Project scope and timing.
2.Develop a light replacement program with Wright Hennepin Electric and Xcel
Energy.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
Intergovernmental revenues in 2023 include a grant from the State for a Flashing Yellow Arrow
project. The project was not completed before year end, so although not budgeted, state
funding will be received in 2024. A transfer from the Liquor Fund in 2023 and fund balance will
be used for undergrounding electric lines as part of the Downtown Pedestrian & Roadways
Improvements.
Measurement 2021 2022 2023 2024
Projects supported 0 1 1 3
STREET LIGHT IMPROVEMENTS 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CH ANGE
Franchise & Other Taxes 189,460$ 161,384$ 190,000$ 157,109$ 175,000$ -7.9%
Intergovernmental Revenues - - 472,500 - - -100.0%
Miscellaneous (5,181) (45,716) 9,500 71,450 10,000 5.3%
Operating Transfers In - - 250,000 250,000 - -100.0%
TOTAL REVENUES 184,279$ 115,668$ 922,000$ 478,559$ 185,000$ -79.9%
EXPENDITURES
Capital Outlay -$ 37,993$ 2,130,000$ 38,563$ 1,430,000$ -32.9%
TOTAL EXPENDITURES -$ 37,993$ 2,130,000$ 38,563$ 1,430,000$ -32.9%
FUND BALANCE - JANUARY 1 995,928$ 1,180,207$ 1,257,883$ 1,257,883$ 1,697,878$
Excess (Deficiency) of
Revenues over Expenditures 184,279 77,675 (1,208,000) 439,996 (1,245,000)
FUND BALANCE - DECEMBER 31 1,180,207$ 1,257,883$ 49,883$ 1,697,878$ 452,878$
174Table of Contents
PARK & PATHWAY IMPROVEMENT FUND (404-45202)
DEPARTMENT: Recreation & Culture SUPERVISOR: Parks, Arts & Recreation Director
ACTIVITY SCOPE:
Activities of the Park & Pathway Improvement Fund include updating and maintaining the
city's pathway system.
OBJECTIVES:
1.Improve pathways and parks systems.
2.Development of Bertram Chain of Lakes Park.
ISSUES:
1.Time and budget constraints of other projects.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
Transfers from other funds typically surpass all other revenue sources. When possible, the city
transfers money into this fund prior to the year of expenditure.
2021 transfers were transferred from the closed Streets Reconstruction Fund. 2023 transfers
are budgeted to come from the Liquor Fund, which will provide funding for the Bertram Chain
of Lakes (BCOL) Pedestrian and Safety Improvements project. Design for future trail
improvements and a bike route map make up the 2024 capital outlay budget.
Measurement 2021 2022 2023 2024
Projects supported 2 1 1 2
PARK & PATHWAY IMPROVEMENT 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Intergovernmental Revenues -$ 150,000$ -$ -$ -$ ---
Miscellaneous (14,831) (42,464) 2,000 57,920 - -100.0%
Operating Transfers In 1,094,000 - 1,000,000 1,000,000 - -100.0%
TOTAL REVENUES 1,079,169$ 107,536$ 1,002,000$ 1,057,920$ -$ -100.0%
EXPENDITURES
Other Services & Charges -$ 500$ -$ 7,670$ -$ ---
Capital Outlay 677,078 - 1,375,000 1,427,970 87,000 -93.7%
Operating Transfers Out 18,997 - -- - ---
TOTAL EXPENDITURES 696,075$ 500$ 1,375,000$ 1,435,639$ 87,000$ -93.7%
FUND BALANCE - JANUARY 1 717,478$ 1,100,572$ 1,207,608$ 1,207,608$ 829,888$
Excess (Deficiency) of
Revenues over Expenditures 383,094 107,036 (373,000) (377,720) (87,000)
FUND BALANCE - DECEMBER 31 1,100,572$ 1,207,608$ 834,608$ 829,888$ 742,888$
175Table of Contents
PARK DEDICATION FUND (405-45202)
DEPARTMENT: Public Works SUPERVISOR: Community Development Director
ACTIVITY SCOPE:
The Park Dedication Fund is used to account for funds charged to developers for future city
park areas.
OBJECTIVES:
1.Provide quality park area within walkable distance to all residential parcels in the
City.
ISSUES:
1.Economic impact on new development and home construction.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The Park Dedication Fund was separated out from the Park & Pathway Improvement Fundin
2021 to properly account for restricted park dedication fees received from developers for the
construction of park areas within new developments. Park dedication fees are an irregular
source of revenue because of unpredictable economic conditions and sporadic new
development. Capital outlay in 2021 and 2022 consisted of credits to developers for park area
improvements in excess of minimum requirements.
Measurement 2021 2022 2023 2024
Acres deeded to city 0.00 1.02 0.00 1.00
Fees collected*-$ 144,832$ 50,247$ 75,000$
*Land may be donated by developer in lieu of paying a park dedication fee.
PARK DEDICATION 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CH ANGE
Charges for Services -$ 144,832$ -$ 50,247$ -$ ---
Special Assessments 9,006 850 815 815 779 -4.4%
Miscellaneous 41 684 185 6,380 221 19.5%
Operating Transfers In 18,997 - - - - ---
TOTAL REVENUES 28,044$ 146,366$ 1,000$ 57,441$ 1,000$ 0.0%
EXPENDITURES
Capital Outlay 28,003$ 45,702$ -$ -$ -$ ---
TOTAL EXPENDITURES 28,003$ 45,702$ -$ -$ -$ ---
FUND BALANCE - JANUARY 1 -$ 41$ 100,705$ 100,705$ 158,147$
Excess (Deficiency) of
Revenues over Expenditures 41 100,664 1,000 57,441 1,000
FUND BALANCE - DECEMBER 31 41$ 100,705$ 101,705$ 158,147$ 159,147$
176Table of Contents
CLOSED CAPITAL PROJECTS FUNDS
CLOSED FUNDS PRESENTED:
•Closed Bond Fund (402-00000)
•Streets Reconstruction Fund (212-43121)
CLOSED FUNDS BUDGETS:
CLOSED BOND FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Special Assessments 749,380$ -$ -$ -$ -$ ---
TOTAL REVENUES 749,380$ -$ -$ -$ -$ ---
EXPENDITURES
Operating Transfers Out 1,663,430$ -$ -$ -$ -$ ---
TOTAL EXPENDITURES 1,663,430$ -$ -$ -$ -$ ---
FUND BALANCE - JANUARY 1 914,050$ -$ -$ -$ -$
Excess (Deficiency) of
Revenues over Expenditures (914,050)$ - - - -
FUND BALANCE - DECEMBER 31 -$ -$ -$ -$ -$
STREET RECONSTRUCTION FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CH ANGE
EXPENDITURES
Operating Transfers Out 1,667,656$ -$ -$ -$ -$ ---
FUND BALANCE - JANUARY 1 1,667,656$ - -$ -$ -$
Excess (Deficiency) of
Revenues over Expenditures (1,667,656) - - - -
FUND BALANCE - DECEMBER 31 -$ -$ -$ -$ -$
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178Table of Contents
2024 Adopted Budget
Enterprise Funds
ENTERPRISE FUNDS - SUMMARY
DESCRIPTION
Enterprise funds are used to report an activity for which a fee is charged to external users for
goods or services. Unlike governmental funds, enterprise funds focus on the determination of
operating income, changes in net position (or cost recovery), financial position, and cash flows.
Enterprise funds use an accrual basis of accounting for financial reporting purposes. A modified
accrual basis will be used for budgeting purposes in this report. Consequently, the bottom line
for each enterprise fund is labeled fund balance rather than net position, which includes capital
assets, long-term debt, and other noncurrent items. Fund balance in enterprise funds is roughly
the same as working capital. The city currently has six active enterprise funds: Water, Sewer,
Stormwater, Liquor (Hi-Way Liquors), Deputy Registrar (DMV), and Fiber Optics (FiberNet).
BUDGET SUMMARY
TOTAL ENTERPRISE FUNDS 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CH ANGE
Franchise & Other Taxes 53,942$ 53,000$ -$ 20,587$ -$ ---
Sale of Goods 7,104,357 7,168,374 7,357,694 7,042,543 7,504,849 2.0%
Licenses & Permits 5,350 2,170 2,000 2,865 2,000 0.0%
Intergovernmental Revenues 95,601 297,608 300,000 305,099 1,330,000 343.3%
Charges for Services 8,717,242 8,902,047 8,071,101 10,357,980 8,458,899 4.8%
Special Assessments 98,695 61,712 10,000 314,560 10,000 0.0%
Miscellaneous (27,667) (552,511) 146,205 1,468,705 134,252 -8.2%
Contributed Capital 664,726 612,608 75,000 988,042 75,000 0.0%
Operating Transfers In 200,000 - - - - ---
TOTAL REVENUES 16,912,246$ 16,545,008$ 15,962,000$ 20,500,382$ 17,515,000$ 9.7%
EXPENDITURES
Personnel Services 2,016,660$ 2,535,186$ 2,503,619$ 2,282,128$ 2,556,843$ 2.1%
Supplies 5,592,137 5,659,038 6,027,117 5,707,493 6,133,540 1.8%
Other Services & Charges 3,515,803 3,631,820 4,975,273 3,656,147 4,651,094 -6.5%
Capital Outlay - - 2,535,000 22,284 4,175,000 64.7%
Debt Service 64,371 45,451 367,991 55,170 367,523 -0.1%
Operating Transfers Out - - 4,000,000 4,000,000 1,100,000 -72.5%
TOTAL EXPENDITURES 11,188,972$ 11,871,495$ 20,409,000$ 15,723,221$ 18,984,000$ -7.0%
FUND BALANCE - JANUARY 1 18,115,663$ 23,838,937$ 28,512,450$ 28,512,450$ 33,289,611$
Excess (Deficiency) of
Revenues over Expenditures 5,723,274 4,673,513 (4,447,000) 4,777,161 (1,469,000)
FUND BALANCE - DECEMBER 31 23,838,937$ 28,512,450$ 24,065,450$ 33,289,611$ 31,820,611$
179Table of Contents
WATER FUND (601-4944x)
DEPARTMENT: Public Works SUPERVISOR: Utilities Superintendent
ACTIVITY SCOPE:
The Water Fund is a self-sustaining city utility fund with two divisions: water administration
and water operations. The water department manages the water utility, providing a
continuous supply of high-quality water to customers at a reasonable cost. The water system is
maintained at proper pressure levels and is bacteria-free. Further, metering equipment is
maintained to account for accurate usage and billing.
OBJECTIVES:
1.Supply clean, safe drinking water to the residents and businesses of Monticello.
2.Maintain a complete system inventory by adding all GPS data points to GIS system.
3.Improve well head protection program.
4.Advance installation of radio reading devices on water meters.
ISSUES:
1.Demands on staff including additional state and federal regulations and other
projects.
2.Elevated manganese levels.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Water customers 4,547 4,621 4,645 4,700
Meters read 54,564 56,402 55,924 57,000
Meters replaced 58 75 83 75
New meters installed 100 92 48 100
Water locates 2,289 1,820 1,619 1,800
Gallons pumped (MG)674 627 651 650
Valves maintained 533 479 475 475
Hydrants maintained 216 225 468 225
Number of fire hydrants 700 700 1,019 700
Times mains flushed 2 2 2 2
Mains/wells rebuilt 0 0 3 0
Water towers inspections 2 2 2 2
Reservoir inspections 1 1 1 1
Water samples sent 191 190 185 190
Radio units installed 197 167 113 175
Service shut-offs 30 26 22 25
Full-Time Equivalents 3.8 3.6 3.8 3.8
180Table of Contents
BUDGET:
BUDGET COMMENTARY:
The Water Fund’s main source of revenue is user charges. Rates increase 8% for the base
charge and usage charges in 2024 in anticipation of the need to fund a future water treatment
plant.
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
adjustment. Other services & charges decrease with fewer anticipated repairs and maintenance
needed. Capital outlays in 2024 are for design work for construction of a future water
treatment plant, a portable generator, and well pump house repairs.
WATER FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Licenses & Permits 5,350$ 2,170$ 2,000$ 2,865$ 2,000$ 0.0%
Intergovernmental Revenues 17,491 76,233 - 101,700 - ---
Charges for Services 1,815,365 1,787,689 1,677,049 2,610,825 1,801,955 7.4%
Special Assessments 37,421 25,593 10,000 207,770 10,000 0.0%
Miscellaneous 38,128 (204,171) 55,951 423,586 56,045 0.2%
Contributed Capital 78,430 184,921 15,000 317,493 15,000 0.0%
TOTAL REVENUES 1,992,186$ 1,872,435$ 1,760,000$ 3,664,239$ 1,885,000$ 7.1%
EXPENDITURES
Personnel Services 264,499$ 345,778$ 401,193$ 354,501$ 418,295$ 4.3%
Supplies 130,598 163,866 281,000 214,276 281,000 0.0%
Other Services & Charges 366,561 335,078 749,807 361,835 554,705 -26.0%
Capital Outlay - - 810,000 - 1,150,000 42.0%
TOTAL EXPENDITURES 761,658$ 844,721$ 2,242,000$ 930,612$ 2,404,000$ 7.2%
FUND BALANCE - JANUARY 1 5,280,477$ 6,511,005$ 7,538,719$ 7,538,719$ 10,272,346$
Excess (Deficiency) of
Revenues over Expenditures 1,230,528 1,027,714 (482,000) 2,733,627 (519,000)
FUND BALANCE - DECEMBER 31 6,511,005$ 7,538,719$ 7,056,719$ 10,272,346$ 9,753,346$
181Table of Contents
SEWER FUND (602-49480 & 602-4949x)
DEPARTMENT: Public Works SUPERVISOR: Utilities Superintendent
ACTIVITY SCOPE:
The Sewer Fund is a self-sustaining city utility fund. The Sewer Fund has three divisions:
sanitary sewer administration, sanitary sewer collection operations and treatment plant
operations. The water department manages the sanitary sewer system, and a private vendor
provides treatment plant services.
OBJECTIVES:
1.Collect and treat wastewater used by city residents and businesses.
2.Maintain a complete system inventory by adding all GPS data points to GIS system.
3.Advance long-range planning regarding plant capacity and expansion.
4.Monitor infiltration of ground water into the sanitary sewer system.
ISSUES:
1.The treatment plant is nearing capacity and alternatives are costly.
2.Ground water infiltration.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Collection
Sewer mains maintained (miles)21 16 26 20
Liftstations 7 7 7 7
Sewer main locates 2,289 1,820 1,619 2,000
Manholes maintained*385 389 828 390
New service hookups 105 85 43 100
Treatment
Screw press influent flow (gals)7,226,500 5,848,200 5,348,525 5,500,000
Thickened sludge (wet tons)2,207 2,231 2,132 2,150
Thickened sludge (dry tons)336 317 303 300
Dry ton % of wet ton 15.2% 14.2% 14.2% 14.0%
Raw influent flow (million gals)482 425 433 450
* Manholes are maintained by quadrants. Fewer manholes in one quadrant allows
more time for cleaning longer main sewer lines.
Full-Time Equivalents 3.75 3.75 3.55 3.55
182Table of Contents
BUDGET:
BUDGET COMMENTARY:
The Sewer Fund’s main source of revenue is user charges. Rates increase 3% for the base
charge and usage charges in 2024. 2021 and 2022 experienced unfavorable market value
adjustments in the city’s investment portfolio, resulting in negative miscellaneous revenues.
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
adjustment. The city renewed its contract with a third-party provider of wastewater treatment
plant management services for five years for 2023 - 2027. Capital outlays in 2024 include a new
gasifier tank at the wastewater treatment plant.
REMAINING DEBT SERVICE:
SEWER FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CH ANGE
Intergovernmental Revenues 38,978$ 166,458$ -$ 203,400$ -$ ---
Charges for Services 3,658,444 3,729,466 3,089,344 4,267,431 3,173,344 2.7%
Special Assessments 39,124 28,298 - 82,241 - ---
Miscellaneous (37,099) (333,055) 29,656 602,644 29,656 0.0%
Contributed Capital 257,766 249,385 - 442,406 - ---
Operating Transfers In 200,000 - - - - ---
TOTAL REVENUES 4,157,212$ 3,840,551$ 3,119,000$ 5,598,121$ 3,203,000$ 2.7%
EXPENDITURES
Personnel Services 419,721$ 492,098$ 367,996$ 408,543$ 383,645$ 4.3%
Supplies 151,227 151,579 198,000 203,865 198,000 0.0%
Other Services & Charges 1,206,183 1,336,409 1,770,013 1,445,662 1,706,832 -3.6%
Capital Outlay - - 975,000 - 700,000 -28.2%
Debt Service 64,371 45,451 367,991 55,170 367,523 -0.1%
TOTAL EXPENDITURES 1,841,502$ 2,025,537$ 3,679,000$ 2,113,240$ 3,356,000$ -8.8%
FUND BALANCE - JANUARY 1 7,285,407$ 9,601,117$ 11,416,132$ 11,416,132$ 14,901,013$
Excess (Deficiency) of
Revenues over Expenditures 2,315,710 1,815,014 (560,000) 3,484,882 (153,000)
FUND BALANCE - DECEMBER 31 9,601,117$ 11,416,132$ 10,856,132$ 14,901,013$ 14,748,013$
Payable Principal Interest Rate Total
6/1/2024 -$ 17,188$ 17,188$
12/1/2024 210,000 17,188 2.75% 227,188
6/1/2025 - 14,300 14,300
12/1/2025 215,000 14,300 3.00% 229,300
6/1/2026 - 11,075 11,075
12/1/2026 225,000 11,075 3.00% 236,075
6/1/2027 - 7,700 7,700
12/1/2027 230,000 7,700 3.20% 237,700
6/1/2028 - 4,020 4,020
12/1/2028 240,000 4,020 3.35% 244,020
Total 1,120,000$ 108,565$ 1,228,565$
GO Wastewater Treatment Bonds, Series 2013B
183Table of Contents
Payable Principal Interest Rate Total
2/20/2024 -$ 7,324$ 7,324$
8/20/2024 108,000 7,324 1.06% 115,324
2/20/2025 - 6,750 6,750
8/20/2025 109,000 6,750 1.06% 115,750
2/20/2026 - 6,171 6,171
8/20/2026 111,000 6,171 1.06% 117,171
2/20/2027 - 5,581 5,581
8/20/2027 112,000 5,581 1.06% 117,581
2/20/2028 - 4,985 4,985
8/20/2028 113,000 4,985 1.06% 117,985
2/20/2029 - 4,385 4,385
8/20/2029 114,000 4,385 1.06% 118,385
2/20/2030 - 3,779 3,779
8/20/2030 115,000 3,779 1.06% 118,779
2/20/2031 - 3,168 3,168
8/20/2031 117,000 3,168 1.06% 120,168
2/20/2032 - 2,546 2,546
8/20/2032 118,000 2,546 1.06% 120,546
2/20/2033 - 1,919 1,919
8/20/2033 119,000 1,919 1.06% 120,919
2/20/2034 - 1,286 1,286
8/20/2034 120,000 1,286 1.06% 121,286
2/20/2035 - 648 648
8/20/2035 122,000 648 1.06% 122,648
Total 1,378,000$ 97,084$ 1,475,084$
MPFA-15-0004-R-FY16
184Table of Contents
CONTRACTED WASTEWATER TREATMENT PLANT SERVICES:
The city started directly paying for chemicals (polymer) in 2018. Electricity and gas charges
were assumed by the city in 2016 and are not reported above as a contract cost.
Year Service Change $ Change %
2015 582,360$ 22,735$ -0.5%
2016 582,360$ -$ 0.0%
2017 593,196$ 10,836$ 1.9%
2018 563,394$ (29,802)$ -5.0%
2019 577,476$ 14,082$ 2.5%
2020 591,913$ 14,437$ 2.5%
2021 606,714$ 14,801$ 2.5%
2022 621,714$ 15,000$ 2.5%
2023 643,648$ 21,934$ 3.5%
2024 666,176$ 22,528$ 3.5%
Schedule of Non-Reimbursables (O&M Services)
$-
$100
$200
$300
$400
$500
$600
$700
2015201620172018201920202021202220232024ThousandsO&M Services Costs
Year R&M Polymer Hauling Landfi ll Electricity Gas Total
2015 50,239$ 35,091$ 25,808$ 28,374$ 145,833$ 44,093$ 329,438$
2016 52,872 32,396 20,876 30,784 - - 136,928
2017 54,705 33,019 23,145 51,057 - - 161,926
2018 61,020 - 39,249 67,654 - - 167,923
2019 43,570 - 34,073 70,871 - - 148,514
2020 56,583 - 28,842 67,993 - - 153,418
2021 71,362 - 32,571 74,783 - - 178,716
2022 62,704 - 35,966 79,681 - - 178,351
2023* 75,000 - 45,000 60,000 - - 180,000
2024* 75,000 - 45,000 60,000 - - 180,000
*Budgeted
Schedule of Reimbursable Costs
$-
$100
$200
$300
$400
2015 2016 2017 2018 2019 2020 2021 2022 2023*2024*ThousandsReimbursable Costs 2015-2024
R&M Polymer Hauling Landfill Electricity Gas
185Table of Contents
STORMWATER FUND (652-4948x)
DEPARTMENT: Public Works SUPERVISOR: Utilities Superintendent
ACTIVITY SCOPE:
The Stormwater Fund is a self-sustaining city utility fund with three divisions: stormwater
administration, stormwater operations and street sweeping. The streets and engineering
department manages the stormwater, which includes street sweeping, MS4 management,
storm sewer televising and cleaning, pond maintenance, and system enhancements.
OBJECTIVES:
1.Protect the city’s natural resources by minimizing the impacts of users on the
environment.
2.Monitor, repair, and clean stormwater trunk lines, laterals, structures, ditches,
holding ponds, and structural pollution control devices.
ISSUES:
1.Continued deterioration of storm water system, without proper funding for repairs,
replacement, or improvements.
2.Educating the public on storm water operations.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Stormwater main miles 73.5 73.8 74.5 74.5
Number of manholes 1,631 1,632 1,640 1,640
Number of ponds 112 112 112 112
Number of outfalls 29 29 29 29
Number of stormwater BMPs*50 50 52 52
*BMPs = structural best management practices (ie. Sumped manhole, infiltration basin)
Full-Time Equivalents 1.10 1.40 1.55 1.55
186Table of Contents
BUDGET:
BUDGET COMMENTARY:
The Stormwater Fund’s main source of revenue is user charges in the form of a stormwater fee,
which is based on 1 drainage unit per residence and 7 drainage units per impervious acre for
non-residential properties. 2021 and 2022 experienced unfavorable market value adjustments
in the city’s investment portfolio, resulting in negative miscellaneous revenues. Contributed
capital is from development access and trunk charges. Due to the unknown nature of
development, these revenues are budgeted conservatively.
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
adjustment. Other services & charges include engineering fees and licenses & permits. Capital
outlay mainly consists of design for improvements to Ditch 33 to the east of the city.
STORMWATER FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Intergovernmental Revenues 39,132$ 54,917$ 300,000$ -$ 1,330,000$ 343.3%
Charges for Services 356,457 522,852 595,000 605,239 595,000 0.0%
Special Assessments 22,150 7,821 - 24,550 - ---
Miscellaneous (7,723) (53,720) 7,000 114,588 7,000 0.0%
Contributed Capital 328,530 178,302 60,000 228,143 60,000 0.0%
TOTAL REVENUES 738,546$ 710,173$ 962,000$ 972,520$ 1,992,000$ 107.1%
EXPENDITURES
Personnel Services 156,640$ 253,931$ 161,188$ 176,821$ 167,950$ 4.2%
Supplies 418 2,089 21,000 15,198 21,000 0.0%
Other Services & Charges 65,470 74,633 383,812 7,285 395,050 2.9%
Capital Outlay - - 420,000 - 2,015,000 379.8%
TOTAL EXPENDITURES 222,528$ 330,653$ 986,000$ 199,305$ 2,599,000$ 163.6%
FUND BALANCE - JANUARY 1 2,284,845$ 2,800,863$ 3,180,382$ 3,180,382$ 3,953,598$
Excess (Deficiency) of
Revenues over Expenditures 516,018 379,520 (24,000) 773,215 (607,000)
FUND BALANCE - DECEMBER 31 2,800,863$ 3,180,382$ 3,156,382$ 3,953,598$ 3,346,598$
187Table of Contents
LIQUOR FUND (609-4975x)
DEPARTMENT: Liquor Fund SUPERVISOR: Liquor Store Manager
ACTIVITY SCOPE:
The Liquor Fund provides customers a place to purchase alcohol and other related products
safely and responsibly. Profits from store operations are used to support other city funds and
activities.
OBJECTIVES:
1.Promote and control the safe and responsible sale of alcohol.
2.Match product selection to changes in demand.
3.Enhance alcohol training program for all liquor store employees.
4.Elevate store attractiveness through customer focused improvements.
5.Boost sales to existing customers.
6.Increase sales per transaction.
7.Improve gross profit margin [1 – (cost/price)].
8.Grow customer base and sales by aggressively marketing the store.
ISSUES:
1.Staff turnover.
2.Proposed legislative action to allow liquor sales in retail stores, thereby causing
more competition.
3.Limited physical space of the store.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Gross profit 1,903,816$ 1,912,345$ 1,927,168$ 1,989,198$
Gross profit % of sales 27% 27% 27% 27%
Sales per square foot $807 $815 $801 $853
Total number of sales 250,894 249,604 240,982 240,000
Staff hours worked 21,641 21,571 21,334 21,750
Sales per hour worked 11.6 11.6 11.3 11.0
Average sale (including tax)$31.14 $31.58 $32.15 $32.96
Full-Time Equivalents 10.20 10.95 11.65 11.65
188Table of Contents
BUDGET:
BUDGET COMMENTARY:
Hi-Way Liquors is a profitable city enterprise fund, with excess cash directed toward capital
projects or other needs. Revenues are generated by the sale of alcoholic beverages and liquor-
industry related merchandise. 2021 and 2022 experienced unfavorable market value
adjustments in the city’s investment portfolio, resulting in negative miscellaneous revenues.
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
adjustment. The 2023 and budgeted 2024 operating transfers out are to capital projects funds,
most notably for the Downtown Pedestrian & Roadways Improvements Project.
LIQUOR FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Sale of Goods 7,104,357$ 7,168,374$ 7,357,694$ 7,042,543$ 7,504,849$ 2.0%
Miscellaneous (8,044) (76,557) 12,306 81,929 12,151 -1.3%
TOTAL REVENUES 7,096,313$ 7,091,818$ 7,370,000$ 7,124,472$ 7,517,000$ 2.0%
EXPENDITURES
Personnel Services 647,423$ 777,316$ 877,711$ 793,236$ 890,834$ 1.5%
Supplies 5,189,566 5,246,183 5,415,117 5,179,602 5,522,540 2.0%
Other Services & Charges 241,524 269,636 337,172 296,461 333,626 -1.1%
Capital Outlay - - 130,000 - - -100.0%
Operating Transfers Out - - 2,250,000 2,250,000 1,000,000 -55.6%
TOTAL EXPENDITURES 6,078,513$ 6,293,135$ 9,010,000$ 8,519,299$ 7,747,000$ -14.0%
FUND BALANCE - JANUARY 1 1,014,600$ 2,032,400$ 2,831,082$ 2,831,082$ 1,436,255$
Excess (Deficiency) of
Revenues over Expenditures 1,017,800 798,682 (1,640,000) (1,394,827) (230,000)
FUND BALANCE - DECEMBER 31 2,032,400$ 2,831,082$ 1,191,082$ 1,436,255$ 1,206,255$
189Table of Contents
DEPUTY REGISTRAR FUND (653-41990)
DEPARTMENT: Deputy Registrar (DMV) SUPERVISOR: DMV Manager
ACTIVITY SCOPE:
The Deputy Registrar (DMV) is a city-based service entity, which assists customers with the
purchase of vehicle license plates/tabs, DNR licenses, and other licenses as required by
Minnesota state agencies. The DMV is one of four limited driver’s license agents in Wright
County. A limited agent can process change-of-address and lost license applications for driver’s
licenses but cannot process routine license renewals. Furthermore, the DMV facility leases
space to FiberNet operations and the Community Center.
OBJECTIVES:
1.Perform DMV services to the public and dealerships with excellent customer service
in a convenient location.
2.Update employee training and certifications.
ISSUES:
1.Frequent and uncontrollable changes to state licensing regulations.
2.Competition with other customer options: other DMVs, on-line, and mail-in.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Outcome/Effectiveness:
License Revenue $936,870 $882,432 $944,931 $900,000
Revenue per staff hour $52.06 $58.46 $64.55 $62.07
Net revenue per staff hour $20.14 $16.28 $20.91 $17.24
Efficiency:
Transactions per hour 5.7 6.0 6.2 6.3
Work Load:
Total transactions 101,784 91,078 90,410 90,750
88,875 77,515 77,870 78,000
DNR transactions 8,759 9,984 8,950 9,000
Game & Fish transactions 265 245 264 250
Driver's license transactions 3,885 3,334 3,326 3,500
Staff hours 17,997 15,094 14,639 14,500
Dealerships serviced 41 47 74 75
Full-Time Equivalents 7.50 8.35 7.55 7.55
Motor vehicle transactions*
190Table of Contents
BUDGET:
BUDGET COMMENTARY:
The main revenue source for the DMV is the fees charged for the issuance of various licenses.
2021 and 2022 experienced unfavorable market value adjustments in the city’s investment
portfolio, resulting in negative miscellaneous revenues.
The 2024 personnel services budget includes a full step increase and a 4.0% market rate wage
adjustment. The 2023 operating transfers out was to the Capital Projects funds for the
Downtown Pedestrian & Roadways Improvements project. The budget 2024 transfer out is to
the Community Center Fund to support its operations.
DEPUTY REGISTRAR 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Charges for Services 941,759$ 883,451$ 840,000$ 945,987$ 900,000$ 7.1%
Miscellaneous (10,954) (64,511) 31,000 168,620 18,000 -41.9%
TOTAL REVENUES 930,805$ 818,940$ 871,000$ 1,114,608$ 918,000$ 5.4%
EXPENDITURES
Personnel Services 526,113$ 666,064$ 689,256$ 549,026$ 689,844$ 0.1%
Supplies 10,977 7,806 12,000 8,004 11,000 -8.3%
Other Services & Charges 46,983 82,391 90,744 84,513 84,156 -7.3%
Capital Outlay - - - 22,284 110,000 ---
Operating Transfers Out - - 1,750,000 1,750,000 100,000 -94.3%
TOTAL EXPENDITURES 584,074$ 756,261$ 2,542,000$ 2,413,829$ 995,000$ -60.9%
FUND BALANCE - JANUARY 1 1,848,750$ 2,195,481$ 2,258,160$ 2,258,160$ 958,939$
Excess (Deficiency) of
Revenues over Expenditures 346,731 62,679 (1,671,000) (1,299,221) (77,000)
FUND BALANCE - DECEMBER 31 2,195,481$ 2,258,160$ 587,160$ 958,939$ 881,939$
191Table of Contents
FIBER OPTICS FUND (656-4987x)
DEPARTMENT: Fiber Optics Fund SUPERVISOR: City Administrator/Finance Director
ACTIVITY SCOPE:
The Fiber Optics Fund is a self-sustaining enterprise fund. Fiber Optics delivers internet, phone,
and cable television services to customers within the city. Residential and commercial
customers can subscribe to individual or bundled services.
OBJECTIVES:
1.Offer a variety of internet speeds and cable packages to customers.
2.Increase subscribers and subscriptions.
ISSUES:
1.Industry trends (cord cutting, etc.) and competition from other service providers.
2.Various legal aspects of operating a telecommunication business.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2021 2022 2023 2024
Internet subscibers 1,808 1,752 1,701 1,701
Phone subscribers 297 275 248 248
Cable TV subscribers 289 256 233 233
Full-Time Equivalents 0 0 0 0
FIBER OPTICS 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Franchise & Other Taxes 53,942$ 53,000$ -$ 20,587$ -$ ---
Charges for Services 1,945,217 1,978,590 1,869,708 1,928,497 1,988,600 6.4%
Miscellaneous (1,975) 179,502 10,292 77,337 11,400 10.8%
TOTAL REVENUES 1,997,184$ 2,211,092$ 1,880,000$ 2,026,422$ 2,000,000$ 6.4%
EXPENDITURES
Personnel Services 2,264$ -$ 6,275$ -$ 6,275$ 0.0%
Supplies 109,351 87,515 100,000 86,547 100,000 0.0%
Other Services & Charges 1,589,081 1,533,673 1,643,725 1,460,391 1,576,725 -4.1%
Capital Outlay - - 200,000 - 200,000 0.0%
TOTAL EXPENDITURES 1,700,697$ 1,621,188$ 1,950,000$ 1,546,937$ 1,883,000$ -3.4%
FUND BALANCE - JANUARY 1 401,584$ 698,071$ 1,287,975$ 1,287,975$ 1,767,459$
Excess (Deficiency) of
Revenues over Expenditures 296,487 589,904 (70,000) 479,484 117,000
FUND BALANCE - DECEMBER 31 698,071$ 1,287,975$ 1,217,975$ 1,767,459$ 1,884,459$
192Table of Contents
BUDGET COMMENTARY:
Revenues in the Fiber Optics Fund come from charges to subscribers, and expenditures are
incurred in operating the system, which is outsourced of operations to a third party. The 2024
budget includes $200,000 in capital outlay for system extensions to new service areas.
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194Table of Contents
2024 Adopted Budget
Internal Service Funds
INTERNAL SERVICE FUNDS - SUMMARY
DESCRIPTION
Internal service funds are a proprietary fund type that may be used to report any activity that
provides goods or services to other funds, departments, or agencies of the primary government
and its component units, or to other governments, on a cost-reimbursement basis. Internal
service funds use an accrual basis of accounting for financial reporting purposes. A modified
accrual basis is used for budgeting purposes in this report. Consequently, the bottom line for
each fund is labeled fund balance rather than net position, which includes capital assets, long-
term debt, and other noncurrent items. Fund balance in an internal service fund is roughly the
same as working capital. The city currently has four active internal service funds: Facilities
Maintenance, IT Services, Central Equipment, and Benefit Accrual.
BUDGET SUMMARY
TOTAL INTERNAL SERVICE FUNDS 2020 2021 2022 2022 2023 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Charges for Services 562,341$ 963,159$ 1,330,400$ 1,447,303$ 1,552,008$ 16.7%
Miscellaneous 24,969 40,771 14,600 (14,226) 43,992 201.3%
Contributed Capital - 44,955 - 33,529 109,000 ---
Operating Transfers In - 1,573,658 - 150,000 - ---
TOTAL REVENUES 587,310$ 2,622,542$ 1,345,000$ 1,616,606$ 1,705,000$ 26.8%
EXPENDITURES
Personnel Services 6,541$ 87,662$ 243,848$ 237,257$ 252,350$ 3.5%
Supplies 98,905 66,767 172,420 105,472 93,932 -45.5%
Other Services & Charges 235,292 296,404 283,452 653,878 581,938 105.3%
Capital Outlay 11,597 - 1,034,280 20,906 1,361,780 31.7%
Debt Service 10,168 6,658 66,000 5,151 66,000 0.0%
TOTAL EXPENDITURES 362,503$ 457,491$ 1,800,000$ 1,022,664$ 2,356,000$ 30.9%
FUND BALANCE - JANUARY 1 1,360,180$ 1,584,987$ 3,750,039$ 3,750,039$ 4,343,980$
Excess (Deficiency) of
Revenues over Expenditures 224,807 2,165,052 (455,000) 593,942 (651,000)
FUND BALANCE - DECEMBER 31 1,584,987$ 3,750,039$ 3,295,039$ 4,343,980$ 3,692,980$
195Table of Contents
FACILITIES MAINTENANCE FUND (701-00000)
DEPARTMENT: Public Works
SUPERVISOR: Facilities Maintenance Manager
ACTIVITY SCOPE:
The Facilities Maintenance Fund is a self-sustaining internal service fund. The Public Works
Director oversees a Facilities Maintenance Manager who manages the city’s various facilities.
The fund’s revenues are derived from service charges to the budget unit of each facility that
receives services. Service charges are adjusted annually to cover all operating maintenance
costs.
OBJECTIVES:
1.Centralize and standardize management of city facilities.
2.Provide financial management stability to each budget unit.
ISSUES:
1.Appropriate costs distribution.
2.Coordination of service delivery to multiple departments and budget units.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Buildings maintained 18 21 21 23
R&M orders 318 799 509 600
R&M order hours 209 474 117 275
Hours per R&M service order 0.7 0.6 0.2 0.5
Total R&M service order costs $91,704 $307,638 $286,374 $300,000
R&M service cost per order $288.38 $385.03 $562.62 $500.00
Note: The Facilities Maintenance department was created in 3rd quarter 2021.
Full-Time Equivalents 0.5 1.1 1.1 1.1
196Table of Contents
BUDGET:
BUDGET COMMENTARY:
The Facilities Maintenance Fund’s main source of revenue is internal user charges, and the fund
accounts for all activity supporting the city’s facilities, including the Community Center/City
Hall, Public Works facility, Fire station, Hi-Way Liquors store, the DMV, Facilities maintenance
office, animal control facility, and Library. Transfers in from the General Fund in 2022 helped
the fund establish a stable fund balance. Revenues and expenditures are both over budget in
2023 due to repair costs for a vehicle crashing into a community center entrance, which was
offset by insurance proceeds. As the balance of work between the Facilities Maintenance
Manager and the staff at each city facility is determined, the fund will see more stable year-to-
year budgets and actual amounts.
FACILITIES MAINTENANCE 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Charges for Services 160,139$ 419,827$ 378,000$ 423,592$ 385,000$ 1.9%
Miscellaneous - 53,656 25,000 167,638 50,000 100.0%
Operating Transfers In - 150,000 - - - ---
TOTAL REVENUES 160,139$ 623,483$ 403,000$ 591,230$ 435,000$ 7.9%
EXPENDITURES
Personnel Services 74,340$ 131,379$ 135,858$ 135,968$ 144,267$ 6.2%
Supplies 21,885 65,188 70,000 53,117 52,000 -25.7%
Other Services & Charges 97,768 357,158 197,142 339,862 238,733 21.1%
TOTAL EXPENDITURES 193,993$ 553,724$ 403,000$ 528,947$ 435,000$ 7.9%
FUND BALANCE - JANUARY 1 -$ (33,854)$ 35,905$ 35,905$ 98,188$
Excess (Deficiency) of
Revenues over Expenditures (33,854) 69,759 - 62,283 -
FUND BALANCE - DECEMBER 31 (33,854)$ 35,905$ 35,905$ 98,188$ 98,188$
197Table of Contents
IT SERVICES FUND (702-00000)
DEPARTMENT: Information Technology
SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The IT (Information Technology) Services Fund is a self-sustaining internal service fund. The IT
Technician manages the network of servers and peripheral equipment to provide continuity
and accountability for IT related services. The fund’s revenues are derived from service charges
to each budget unit receiving IT services. Service charges are adjusted annually to cover all
current costs plus a portion of capital outlays.
OBJECTIVES:
1.Centralize management of IT services and resources into one department.
2.Provide financial management stability to each budget unit by distributing capital costs
over multiple periods.
ISSUES:
1.Appropriate costs distribution.
2.Coordination of service delivery to multiple departments and budget units.
3.Increasing threats to cyber security.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Work Load:
Number of employees 1 1 1 1
Number of users 88 109 109 119
Number of PC, servers, and
network devices 126 -- ----
Number of computers & phones --207 207 207
Number of back-end support
network devices --62 62 62
Network availability (estimate)98% 99% 99% 99%
An audit of the city's IT inventory found previously uncounted users and devices in 2022.
Full-Time Equivalents 0.4 1 1 1
198Table of Contents
BUDGET:
BUDGET COMMENTARY:
The IT Services Fund’s main source of revenue is internal user charges. The IT Services Fund
accounts for all activity supporting the city’s information technology infrastructure, including
servers, routers, personal computers (PCs), printers, copiers, phones, and professional services.
The city added an internal staff position in August 2021. A desire to account for all
departments’ IT-related purchases, managed by the IT Technician, through this internal service
fund led to an increased budget over the past few years.
IT SERVICES 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Charges for Services 270,566$ 421,000$ 529,008$ 529,009$ 549,994$ 4.0%
Miscellaneous (751) (4,529) 8,992 14,536 10,006 11.3%
TOTAL REVENUES 269,815$ 416,471$ 538,000$ 543,545$ 560,000$ 4.1%
EXPENDITURES
Personnel Services 33,237$ 96,553$ 104,492$ 104,480$ 111,414$ 6.6%
Supplies 44,882 40,877 23,932 28,413 27,365 14.3%
Other Services & Charges 198,636 301,136 384,796 332,308 396,441 3.0%
Capital Outlay - - 24,780 - 24,780 0.0%
TOTAL EXPENDITURES 276,755$ 438,567$ 538,000$ 465,201$ 560,000$ 4.1%
FUND BALANCE - JANUARY 1 267,384$ 260,444$ 238,348$ 238,348$ 316,692$
Excess (Deficiency) of
Revenues over Expenditures (6,940) (22,095) - 78,344 -
FUND BALANCE - DECEMBER 31 260,444$ 238,348$ 238,348$ 316,692$ 316,692$
199Table of Contents
CENTRAL EQUIPMENT FUND (703-00000)
DEPARTMENT: Public Works
SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The Central Equipment Fund is a self-sustaining internal service fund. The finance department
participates along with various department directors and division leaders in the acquisition of
capital assets. The acquired capital asset is charged back against the benefitting budget unit
through rental charges over a set number of years. The rental charge reflects depreciation plus
inflation. Service charges for each asset are fixed for the duration of rental payments.
OBJECTIVES:
1.Maintain a reliable inventory of equipment for staff use in providing city services.
2.Provide financial management stability to each budget unit by distributing capital costs
over multiple annual reporting periods
ISSUES:
1.Appropriate cost distribution over multiple accounting periods.
2.Efficient coordination of asset replacement activities between departments.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Outcome/Effectiveness:
Annual cost recovery 552,369$ 578,400$ 633,000$ 567,500$
Total costs of assets acquired 1,269,093$ 560,113$ 923,357$ 292,000$
Efficiency:
Cost recovery as % of
acquired assets 44% 103% 69% 194%
Work Load:
Number of fund assets 51 61 69 77
200Table of Contents
BUDGET:
BUDGET COMMENTARY:
The Central Equipment Fund’s main source of revenue is internal rental charges. The city
issued $515,000 in G.O. bonds in 2014 to finance the acquisition of a fire tender and a plow
truck; these bonds will be fully paid off in 2024. The 2021 operating transfers came from the
closure of the Streets Reconstruction capital projects fund and excess fund balance in the
General Fund, which will help the fund with future equipment purchases.
The 2024 budgeted equipment acquisitions: [public works equipment] two-ton pickup with
hoist and dump bow - $95,000; 250 gallon tack trailer - $40,000; 40” cold planer - $32,000;
[recreation equipment] one-ton pickup - $90,000; Kifco water wheel - $20,000; walk-behind
mower - $15,000.
REMAINING DEBT SERVICE:
CENTRAL EQUIPMENT FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Charges for Services 552,369$ 578,400$ 633,000$ 633,000$ 567,500$ -10.3%
Miscellaneous 43,420 (51,468) 10,000 62,023 10,000 0.0%
Contributed Capital 44,955 33,529 109,000 14,255 10,500 -90.4%
Operating Transfers In 1,573,658 - - - - ---
TOTAL REVENUES 2,214,401$ 560,461$ 752,000$ 709,278$ 588,000$ -21.8%
EXPENDITURES
Capital Outlay -$ -$ 1,337,000$ 20,906$ 292,000$ -78.2%
Debt Service 6,658 5,151 66,000 4,047 63,000 -4.5%
TOTAL EXPENDITURES 6,658$ 5,151$ 1,403,000$ 24,953$ 355,000$ -74.7%
FUND BALANCE - JANUARY 1 962,590$ 3,170,333$ 3,725,643$ 3,725,643$ 4,409,968$
Excess (Deficiency) of
Revenues over Expenditures 2,207,743 555,310 (651,000) 684,325 233,000
FUND BALANCE - DECEMBER 31 3,170,333$ 3,725,643$ 3,074,643$ 4,409,968$ 4,642,968$
Payable Principal Interest Rate Total
6/15/2024 -$ 915$ 915$
12/15/2024 60,000 915 3.05% 60,915
Total 60,000$ 1,830$ 61,830$
GO Bonds, Series 2014A (Equipment Portion)
201Table of Contents
BENEFIT ACCRUAL FUND (704-00000)
DEPARTMENT: Finance
SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The Benefit Accrual Fund is a self-sustaining internal service fund. The finance department,
supervisors and the human resources manager oversee vacation, sick leave, and paid-time-off
(PTO) benefits. The non-enterprise fund liability for this benefit is recorded in the Benefit
Accrual Fund. Enterprise funds maintain the liability for employees involved in enterprise
operations. Expenditures in each governmental fund budget unit are adjusted annually to
reflect changes to the liability caused by the employees of that budget unit.
OBJECTIVES:
1.Provide mechanism for recording and funding governmental fund liabilities for paid
leaves.
2.Provide financial management stability to each budget unit.
ISSUES:
1.Increasing cost of paid leave benefits.
MEASURABLE WORKLOAD DATA:
Measurement 2021 2022 2023 2024
Outcome/Effectiveness:
Annual hours accrued:
PTO 9,391 10,373 11,057 11,500
Comp Time 1,134 1,246 810 1,000
Vacation & Sick Leave 272 272 272 -
Balance of accrued hours:
PTO 9,127 9,320 10,033 10,000
Comp Time 749 768 434 150
Vacation & Sick Leave 647 689 378 -
Efficiency:
Annual hours accrued per employee:
PTO 168 176 191 195
Comp Time 33 34 23 29
Vacation & Sick Leave 272 272 272 -
Work Load:
Employees accruing hours:
PTO employees 56 59 58 59
Full-time hourly employees 34 37 35 35
Vacation & Sick Leave
employees (pre-1990)1 1 1 -
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BUDGET:
BUDGET COMMENTARY:
The Benefit Accrual Fund’s main source of revenue is internal charges to personnel services in
the General Fund, Monticello Community Center Fund, and Economic Development Authority
Fund. Personnel services expenditures in each governmental fund budget unit will be adjusted
up or down based on the change in liability caused by each unit. The liability is based on the
number of hours accrued multiplied by the hourly compensation for each employee.
In 2024, the city’s personnel policy is updated to reflect the transition of one employee from
the vacation and sick leave benefits to the paid time off (PTO) benefit. Also changing in 2024 is
the payout of accrued compensatory (comp) time with the final paycheck of the year. However,
the union’s bargaining agreement is not up for renewal until 2026, so union employees can
continue to rollover unused compensatory time. All employees can carry over up to 320 hours
of accrued PTO.
BENEFIT ACCRUAL FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Charges for Services (19,915)$ 9,325$ 12,000$ 26,758$ 12,000$ 0.0%
Miscellaneous (1,898) (11,886) - 14,729 - ---
TOTAL REVENUES (21,813)$ (2,560)$ 12,000$ 41,487$ 12,000$ 0.0%
EXPENDITURES
Personnel Services (19,915)$ 9,325$ 12,000$ 26,758$ 12,000$ 0.0%
TOTAL EXPENDITURES (19,915)$ 9,325$ 12,000$ 26,758$ 12,000$ 0.0%
FUND BALANCE - JANUARY 1 355,013$ 353,116$ 341,230$ 341,230$ 355,959$
Excess (Deficiency) of
Revenues over Expenditures (1,897) (11,886) - 14,729 -
FUND BALANCE - DECEMBER 31 353,116$ 341,230$ 341,230$ 355,959$ 355,959$
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204Table of Contents
2024 Adopted Budget
Discretely Presented Component
Unit Funds
DISCRETELY PRESENTED COMPONENT UNIT FUND - SUMMARY
DESCRIPTION
The city currently has one discretely presented component unit fund. Component units are
legally separate entities for which the city (primary government) is financially accountable, or
for which the exclusion of the component unit would render the financial statements of the
primary government misleading. Criteria used to determine if the primary government is
financially accountable for a component unit includes whether or not the primary government
appoints the voting majority of the potential component unit’s governing body, is able to
impose its will on the potential component unit, is in a relationship of financial benefit or
burden with the potential component unit or is fiscally depended upon by the potential
component unit.
The Monticello Economic Development Authority (EDA) is a legally separate entity created
pursuant to Minnesota Statutes § 469.090 through § 469.108 to carryout economic and
industrial development and redevelopment within the city in accordance with policies
established by the City Council. The seven-member Board of Directors consists of two
councilmembers and five members from the community appointed by the City Council.
Management of the city has complete operational responsibility of the EDA’s activities, and the
City Council reviews and approves the tax levy and all expenditures for the EDA.
Because the council does not make up a majority of the EDA board and there is no financial
burden or benefit relationship between the city and EDA, the EDA is reported as a discretely
presented component unit of the city. The EDA discretely presented component unit fund uses
the modified accrual basis of accounting for both financial reporting and budgeting purposes.
205Table of Contents
ECONOMIC DEVELOPMENT AUTHORITY FUND (213-46301)
DEPARTMENT: Economic Development SUPERVISOR: Economic Development Manager
ACTIVITY SCOPE:
The Monticello Economic Development Authority (EDA) is responsible for the on-going
redevelopment efforts within the city. This consists of housing and businesses, including all
related public improvements and land acquisitions. These programs are administered, based
on direction of the EDA board, by the Economic Development Manager. In addition, all tax
increment financing districts are initiated and administered by the EDA.
There are currently 5 active tax increment districts and 5 decertified, active districts. 5
additional TIF districts have been authorized by the EDA Board, 4 of which have been certified
to the Office of the State Auditor (OSA) but have not started receiving increment.
The EDA also administers loans to city businesses, based on local, state, and federal criteria.
Businesses who will generate higher paying jobs in the community are prime candidates for
these loans.
OBJECTIVES:
1.Attract new businesses to Monticello, including medical manufacturing, food-related,
and data center facilities.
2.Support existing businesses through training/education programs or assisting with
expansion or relocation efforts within the city.
3.Implement short, intermediate, and long-term objectives outlined in the TIF Analysis
and Management Plan and the Embracing Downtown Plan.
4.Acquire land that makes sense for redevelopment purposes.
5.Utilize JobZ Bill to initiate private development/redevelopment.
6.Work with community development department and developers to create upper-end
housing in Monticello.
7.Explore options to generate additional electrical supply to industrial areas.
8.Explore options to relocate electrical substation from Cargill's downtown site to create
expansion opportunities.
9.Implement recommendations from consultants regarding uses of funds available,
especially in TIF District 1-22.
10.Implement monitoring/tracking methods for EDA programs.
ISSUES:
1.Consistent administration of city and EDA policies, plans, ordinances, guidelines,
statutes, etc.
2.Need for higher wage jobs in the community.
3.Patience for plans to come to fruition.
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MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
Under Section 469.033, subd. 6, of the HRA Act, the HRA’s special benefit tax is levied annually
and is limited to 0.0185% of the taxable market value. The main revenue sources for the EDA
Fund are property taxes and tax increments from the various tax increment financing (TIF)
districts. One district decertified in 2022 and two more decertified in 2023. Intergovernmental
revenues were a pass-through Minnesota Investment Fund (MIF) grant passed through from
Measurement 2021 2022 2023 2024
Properties acqui red 1 1 3 1
Properties sold 0 11 0 1
GMEF loans outstanding 3 3 3 3
GMEF loans originated 1 0 0 1
Façade loans originated 0 2 0 1
Façade loans outstanding 0 0 0 3
Misc. other ED subsidy
loans/grant originated 0 3 0 3
Misc. other ED subsidy
loans/grant outstanding 0 2 0 5
TIF Districts newly created 0 5 0 1
Active TIF districts 9 8 11 9
Full-Time Equivalents 1.2 1.5 1.6 1.6
ECONOMIC DEVELOPMENT AUTHORITY FUND 2021 2022 2023 2023 2024 %
REVENUES ACTUAL ACTUAL BUDGET ESTIMATED BUDGET CHANGE
Property Taxes 367,765$ 387,486$ 402,000$ 401,739$ 451,000$ 12.2%
Tax Increments 732,688 720,301 529,000 550,598 258,000 -51.2%
Franchise & Other Taxes 662 805 - 68 - ---
Intergovernmental Revenues - 375,547 - 284,123 - ---
Charges for Services 26,951 139,673 - 1,281 - ---
Miscellaneous 304,007 718,441 50,000 244,552 50,000 0.0%
Operating Transfers In 2,368 4,900 6,000 3,950 6,000 0.0%
TOTAL REVENUES 1,434,441$ 2,347,154$ 987,000$ 1,486,311$ 765,000$ -22.5%
EXPENDITURES
Personnel Services 119,333$ 171,262$ 189,639$ 186,789$ 197,158$ 4.0%
Supplies 54 374 300 35 400 33.3%
Other Services & Charges 595,450 1,825,856 1,418,211 680,905 329,451 -76.8%
Capital Outlay 31,516 273,769 214,850 98,775 268,991 25.2%
Operating Transfers Out 198,700 197,925 - - - ---
TOTAL EXPENDITURES 945,053$ 2,469,186$ 1,823,000$ 966,504$ 796,000$ -56.3%
FUND BALANCE - JANUARY 1 6,518,705$ 7,008,094$ 6,886,062$ 6,886,062$ 7,405,869$
Excess (Deficiency) of
Revenues over Expenditures 489,389 (122,032) (836,000) 519,807 (31,000)
FUND BALANCE - DECEMBER 31 7,008,094$ 6,886,062$ 6,050,062$ 7,405,869$ 7,374,869$
207Table of Contents
the state to a private developer. The increase in miscellaneous revenues in 2022 is related to a
land sale.
Expenditures include administrative costs, pay-as-you-go payments to various development
projects, and a transfer to debt service funds for 2011A bond payment, which was paid off in
2022. Other services & charges in 2022 reflect use of pooled TIF for a land sale to a private
developer associated with one of the new TIF districts that was certified in 2023, which will
start generating increment in 2025.
208Table of Contents
2024 Adopted Budget
Appendix
COMMUNITY, DEMOGRAPHIC, AND STATISTICAL INFORMATION
Classified as a 501(a) entity under the Internal Revenue Code, the city of Monticello was
organized as a municipality in 1856. Monticello is located approximately 45 miles northwest of
the Minneapolis-St. Paul metropolitan area along the I-94 corridor in Wright County. The 2020
U. S. Census estimated Monticello's population at 14,455, and the city encompasses an area of
8.87 square miles. The city operates under a statutory form of government. The mayor and four
councilmembers (together known as "City Council") govern the city. The councilmembers are
each elected to staggered, four-year terms and the mayor a two-year term. The mayor presides
over and is a voting member of the City Council. The mayor is the chief authority for
administering city government and appoints department heads, various board members and
commission members. The City Council is the legislative body and meets twice per month. The
City Council's main responsibilities are guiding the growth and development of the City using
the Monticello 2040: Vision + Comprehensive Plan, appropriating funds, setting salaries,
adopting ordinances and resolutions, and approving the budget.
Monticello has a varied business community with a healthy mix of retail and manufacturing.
City unemployment rates are like that of the state, but from 2015 to 2019 and 2022, the state’s
rate was slightly lower.
Home to one of the two nuclear electric generation plants in Minnesota, Monticello’s second
largest employer is Xcel Energy, not far behind the Monticello School District. Regional medical
provider, CentraCare, and Agri-giant Cargill also maintain a strong presence in the city.
Average Employment
Year Wright County Wright County State of Minnesota
2014 68,091 4.0%4.1%
2015 38,855 3.8%3.6%
2016 69,254 4.3%4.0%
2017 71,796 3.5%3.1%
2018 72,455 3.4%3.2%
2019 73,088 3.8%3.5%
2020 69,972 4.4%4.4%
2021 72,474 2.7%3.0%
2022 75,573 3.2%2.5%
2023 74,800 2.8%2.9%
HISTORICAL EMPLOYMENT/UNEMPLOYMENT DATA
(Rates are not compiled for individual communities within counties)
Average Unemployment
Employer Employees
ISD No. 882 (Monticello)684
Xcel Energy (Northern States)650
CentraCare Health - Monticello 577
Cargill Kitchen Sol. (Sunny Fresh)425
Target 307
Walmart Supercenter 225
Ultra Machining Corporation 215
City of Monticello 176
Home Depot 157
WSI Industries 120
TOP TEN CITY EMPLOYERS
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Monticello’s population and households are roughly 0.25% of the state’s total for both
measures. With Target, Walmart, Home Depot, Runnings, and Mills Fleet Farm, it is no surprise
that retail sales per person are higher than the state average. The following table contains
selected facts about the city:
The nuclear plant accounts for approximately 40% of the city’s net tax capacity for taxes
payable in 2024. Xcel’s tax capacity and the council’s conservative tax levy philosophy are the
main reasons the city tax capacity rate is the third lowest in Wright County. Substantial
residential property valuation increases in 2023 offset by a decrease to Xcel’s electric
generating plant contributed to a projected 8.2% tax base increase. With an 8.5% levy increase,
the 2024 tax rate is projected to increase slightly. The overall tax base is about one-third
residential and two-thirds commercial (including the electric generating plant).
People QuickFacts Monticello Minnesota
Population, 2023 estimate July 1 15,087 5,737,915
Population, Census, April 1, 2020 14,455 5,706,494
Population, percent change, April 1, 2020 to July 1, 2023 4.4% 0.6%
Persons under 5 years, percent 7.0% 5.8%
Persons under 18 years, percent 27.2% 22.6%
Persons 65 years and over, percent 10.5% 17.4%
Female persons, percent 50.6% 49.8%
White persons, percent 87.6% 82.6%
Hispanic or Latino, percent 8.1% 6.0%
Homeownership rate, 2018-2022 65.1% 72.3%
Median value of owner-occupied housing units, 2018-2022 $279,600 $286,800
Households, 2018-2022 5,548 2,256,126
Persons per household, 2018-2022 2.58 2.46
Retail sales per capita, 2017 $33,121 $16,518
Median household income, 2018-2022 $80,290 $84,313
Population per square mile, 2020 1,629.8 71.7
Land area in square miles, 2020 8.87 79,626.68
2021 2022 2023 2024 2023-24 2023-24
City Tax Rate Tax Rate Tax Rate Tax Rate Change Change %
City of St. Michael 35.817 33.909 27.132 25.764 -1.368 -5.3%
City of Otsego 34.653 34.545 29.572 28.613 -0.959 -3.4%
City of Monticello 35.659 36.536 34.991 35.118 0.127 0.4%
City of Dayton 51.378 47.733 35.109 35.821 0.712 2.0%
City of Rockford 44.345 43.836 41.278 36.826 -4.452 -12.1%
City of Hanover 46.491 43.569 38.223 38.012 -0.211 -0.6%
City of Waverly 60.997 57.262 44.630 41.136 -3.494 -8.5%
City of Delano 49.369 49.061 42.657 41.313 -1.344 -3.3%
City of Albertville 46.801 46.355 41.794 41.908 0.114 0.3%
City of Annandale 54.571 54.606 47.741 42.837 -4.904 -11.4%
City of Montrose 51.607 51.719 47.934 44.133 -3.801 -8.6%
City of Buffalo 54.256 55.034 50.562 47.817 -2.745 -5.7%
City of Clearwater 69.513 69.978 63.657 52.238 -11.419 -21.9%
City of Cokato 68.015 68.079 60.436 55.180 -5.256 -9.5%
City of Maple Lake 61.994 62.164 59.182 62.134 2.952 4.8%
City of Howard Lake 72.596 67.661 62.009 64.106 2.097 3.3%
City of South Haven 91.707 90.696 81.173 74.084 -7.089 -9.6%
CITY TAX RATES IN WRIGHT COUNTY, MINNESOTA
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Monticello’s population grew by approximately 17% in the last ten years. The city has
undeveloped commercial and residential real estate and is positioned well to benefit from more
urban flight from the Twin Cities. Access to major transportation corridors makes the city an
ideal location for future growth. The following table includes population statistics over the last
ten years:
As shown in these statistics, Monticello is unique with a very different set of circumstances
from many other communities of 15,000 in population. Operating a municipal liquor store,
deputy registrar, telecommunications network, and community center create additional work
from a staffing perspective and demand more management and oversight. Its location on an
interstate brings commuters from outside the city, which is beneficial to business that operate
in the city but creates additional wear and tear on city streets and demand for recreational
services. For this reason, the city is pursuing a Local Option Sales Tax from the voters on the
2024 ballot. The city is also growing with new development, providing some growth to the tax
base. However, the city is not in control of the timing of development, which in many instances
requires public investment in addition to private investment.
Additionally, the city having one major taxpayer with complex regulations creates risk and
uncertainty. Xcel’s plant is valued using a complicated set of information and considerations by
the State of Minnesota’s Department of Revenue. Long-term planning is especially challenging
because the plant’s current license expires in 2030. While Xcel is in the process of extending its
license to 2040, with a stated desire at this time to eventually extend to 2050, the re-licensure
will not be finalized until later in 2024. Having one large and unique taxpayer causes differences
in per capita figures, which makes it difficult to find comparison city data. Additionally, it
creates uncertainty in future impacts to other taxpayers whether the levy is raised annually or
not.
Year Population Change
2014 12,993 92
2015 13,125 132
2016 13,311 186
2017 13,409 98
2018 13,553 144
2019 13,782 229
2020 13,886 104
2021 14,455 569
2022 14,619 164
2023 15,087 468
211Table of Contents
PROPERTY TAX BASICS
Assessment and Classification
The property tax system is a continuous cycle, but it effectively begins with the estimation of
property market values by local assessors. Assessors attempt to determine the approximate
selling price of each parcel of property based on the current market conditions.
Along with the market value determination, a property class is assigned to each parcel of
property based on the use of the property. For example, property that is owner-occupied as a
personal residence is classified as a residential homestead. The “use class” is important because
the Minnesota system, in effect, assigns a weight to each class of property. Generally,
properties that are associated with income production (e.g., commercial, and industrial
properties) have a higher classification weight than other properties.
The property classification system defines the tax capacity of each parcel as a percentage of
each parcel’s market value. For example, a $75,000 home which is classified as a residential
homestead has a class rate of 1.0 percent and therefore has a tax capacity of $75,000 x .01 or
$750. (A sample of the class rates is included in the table on the next page.)
[parcel market value] * [class rate] = [parcel tax capacity]
The next step in calculating the tax burden for a parcel involves the determination of each local
unit of government’s property tax levy. The city, county, school district, and any special
property taxing authorities must establish their levy by December 28 of the year preceding the
year in which taxpayers will pay the levy. The property tax levy is set after the consideration of
all other revenues including state aids such as LGA.
[city budget] - [all non-property tax revenues] = [city levy]
Local Tax Rates
Local governments do not directly set a tax rate. Instead, the tax rate is a function of the levy
and the total tax base. To compute the local tax rate, a county must determine the total tax
capacity to be used for spreading the levies. The total tax capacity is computed by first
aggregating the tax capacities of all parcels within the city. Several adjustments to this total
must be made because not all tax capacity is available for general tax purposes. The result of
this calculation produces taxable tax capacity. Taxable tax capacity is used to determine the
local tax rates.
[city levy] / [taxable tax capacity] = [city tax rate]
Parcel Tax Calculations
The property tax bill for each parcel of property is determined by multiplying the parcel’s tax
capacity by the total local tax rate. The tax statement for each individual parcel itemizes the
taxes for the county, municipality, school district, and any special taxing authorities.
[parcel tax capacity] * [total local tax rate] = [parcel property tax bill]
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213Table of Contents
Terms Defined
Class rates - The percent of market value set by state law that establishes the property’s tax
capacity subject to the property tax. See table below for a sample list of class rates.
Local tax rate - The rate used to compute taxes for each parcel of property. Local tax rate is
computed by dividing the certified levy (after reduction for fiscal disparities distribution levy
and disparity reduction) by the taxable tax capacity.
Homestead Market Value Exclusion (HMVE) – Starting with taxes payable in 2012, eligible
homesteads will pay property taxes on only a portion of the value of their homes. The
maximum exclusion, 40% of value, occurs at home value of $76,000 and phases out as home
value grows.
Property class - The classification assigned to each parcel of property based on the use of the
property. For example, owner-occupied residential property is classified as homestead.
Tax capacity - The valuation of property based on market value and statutory class rates. The
property tax for each parcel is based on its tax capacity.
Truth-in-Taxation - The “taxation and notification law” which requires local governments to set
estimated levies, inform taxpayers about the impacts, and announce which of their regularly
scheduled council meetings will include a discussion of the budget and levy. Taxpayer input is
taken at that meeting.
Property Class Local Taxes
Payable 2024
State Tax Payable 2024
Residential Homestead: No state tax
1st $500,000 1.00%
>$500,000 1.25%
Non-homestead Residential: No state tax
Single unit:
1st $500,000 1.00% >$500,000 1.25%
2–3-unit buildings 1.25%
Market-rate Apartments: 1.25% No state tax
Commercial/Industrial:
1st $150,000 1.50% Subject to state levy
>$150,000
Electric generation machinery
2.00%
2.00% (Commercial-industrial rate)
Seasonal Recreational Residential:
1st $500,000 1.00% Subject to state levy
>$500,000 1.25% (Commercial-industrial rate)
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TRUTH-IN-TAXATION (TNT)
Summary Chart for Taxes Payable 2024
Date Action
On or Before
Sept. 30
All cities and special taxing districts (EDAs, HRAs, port authorities, etc.) must
adopt any proposed property tax levy and certify the proposed levy to the
county auditor. (September 25, 2023)
On or Before
Sept. 30
At one meeting, the city council adopts the proposed property tax levy and
announces the time and place of a future city council meeting at which the
budget and levy will be discussed, and public input allowed, prior to final
budget and levy determination. (September 25, 2023)
On or before
Sept. 30
Cities must provide the county auditor with the following information:
• The time and place of the meeting at which the budget and levy will
be discussed, and public input allowed. (This public input meeting must
occur after Nov. 24 and must start at or after 6 p.m. The time and place of
the public input meeting must be included in the minutes.)
• A phone number that city taxpayers may call if they have questions
related to the auditor’s property tax notice; this does not require listing a
private phone number.
• An address where comments will be received by mail; this does not
require listing a private address.
(September 26, 2023)
Nov. 11 - Nov. 24 County auditor prepares and sends parcels specific notices.
Nov. 25 - Dec. 28 City council holds meeting to discuss the budget and property tax levy and,
before a final determination, allows public input. (December 11, 2023)
On or before Dec.
28
Cities must certify final property tax levy to the county auditor. Cities must
also file the certificate of compliance (Form TNT) with the Department of
Revenue by December 28th. (December 12, 2023)
**The date an activity occurred is highlighted.
215Table of Contents
DEBT GUIDE
Equipment Certificates/Capital Notes
A statutory city may issue certificates of indebtedness or capital notes (Section 412.301) to
purchase:
Public safety equipment, ambulance, and other medical equipment; road construction and
maintenance equipment; and other capital equipment.
Computer hardware and software, whether bundled with machinery or equipment or un-
bundled, together with application development services and training related to the use of
the computer hardware or software.
The statute does not define “other capital equipment.” Cities seeking to borrow for equipment
not specifically listed should work with bond counsel to determine eligibility.
The term of the Certificates/Notes cannot exceed 10 years from the dated date of the obligations.
This limitation may affect the timing of principal and interest payments. This debt is subject to
the debt limit.
A reverse referendum provision applies if the amount of the borrowing exceeds 0.25% of the
estimated market value of taxable property within the city. An election is required if a petition
signed by voters equal to 10% of the voters in the last regular municipal election is submitted to
the city clerk within 10 days after publication of the resolution authorizing the issuance of the
Certificates/Notes.
Different statutory authority exists for home rule charter cities (Section 410.32). Capital Notes
issued by charter cities are subject to the same statutory requirements as statutory cities with
the following exceptions:
The total principal amount of the capital notes issued in a fiscal year shall not exceed 0.03%
of the estimated market value of taxable property in the city.
No reverse referendum provision applies, but issuance must be approved by a two-thirds vote
of the city council.
Unless prohibited by the charter, these cities may also issue Capital Notes under the authority
granted to statutory cities.
Tax Abatement Bonds
Tax Abatement Bonds (Section 469.1814) may be used to finance a variety of development
activities and public improvements. The statute allows proceeds of Tax Abatement Bonds be used
to (1) pay for public improvements that benefit the property, (2) to acquire and convey land or
other property, as provided under this section, (3) to reimburse the property owner for the cost
of improvements made to the property, or (4) to pay the costs of issuance of the bonds.
Tax Abatement Bonds are often used to facilitate economic development in ways not allowed by
tax increment financing. They have also evolved into a tool for financing community recreation
and cultural facilities. The statutory authority creates an abatement levy based on the property
value of parcels subject to the abatement. The authority to use tax abatement applies separately
216Table of Contents
to each taxing jurisdiction. If other jurisdictions (county and school district) approve an
abatement, this revenue may be pledged to bonds issued by the city.
The principal amount of the bonds may not exceed the sum of the authorized abatements.
A debt service levy may be used to pay interest on the bonds.
The annual amount of all abatements cannot exceed the greater of 10% net tax capacity
value of the jurisdiction or $200,000.
The parameters of the abatement and authorization for the bonds are set by resolution.
The resolution cannot be approved until after a public hearing is held.
Street Reconstruction Bonds
Street Reconstruction Bonds are an example of debt issuing authority found in unusual places.
The statutory provisions for Street Reconstruction Bonds appear in the portion of Chapter 475
dealing with election requirements for debt issuance (Section 475.58, Subd. 3b).
Street Reconstruction Bonds can be used to finance the reconstruction and bituminous overlay
of existing city streets. Eligible improvements may include turn lanes and other improvements
having a substantial public safety function, realignments, other modifications to intersect with
state and county roads, and the local share of state and county road projects. Except in the case
of turn lanes, safety improvements, realignments, intersection modifications, and the local share
of state and county road projects, street reconstruction and bituminous overlays does not include
the portion of project cost allocable to widening a street or adding curbs and gutters where none
previously existed. The enabling statute sets forth specific requirements for the issuance of Street
Reconstruction Bonds:
The projects financed under this authority must be described in a street reconstruction
plan. The plan must describe the street reconstruction or overlay to be financed, the
estimated costs, and any planned reconstruction or overlay of other streets in the
municipality over the next five years
The city must hold a public hearing on the proposed plan and the related issuance of bonds.
The plan and the issuance of bonds must be approved by the city council by a vote of all the
members of the governing body present at the meeting.
The issuance of bonds is subject to a reverse referendum. An election is required if voters
equal to 5% of the votes cast in the last municipal general election file a petition with the
city clerk within 30 days of the public hearing. If the city decides not to undertake an
election, it may not propose the issuance of Street Reconstruction Bonds for the same
purpose and in the same amount for a period of 365 days from the date of receipt of the
petition. If the question of issuing the bonds is submitted and not approved by the voters,
the provisions of section 475.58, subdivision 1a, shall apply (no resubmission for same
purpose/ amount for 180 days).
Street Reconstruction Bonds are subject to the debt limit.
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Revenue Bonds
One exception to the previous statement is the issuance of Revenue Bonds. Chapter 475
authorizes borrowing for “any utility or other public convenience from which a revenue is or may
be derived”. This authority is sufficient when the sole security is the pledge of revenue from a
public enterprise. Although this debt is most frequently associated with municipal utilities, any
“public convenience” with a pledge-able source of revenue may use this authority. Minnesota
cities do not frequently issue Revenue Bonds. Most borrowing needs have separate statutory
authority that allows a general obligation pledge. The most common Revenue Bonds are for
electric utilities, sales taxes, and liquor stores.
Improvement Bonds
One of the most used tools is General Obligation (G.O.) Improvement Bonds issued pursuant to
Chapter 429. Improvement Bonds can be issued for a wide range of public improvements.
Eligible Improvements
The types of improvements specifically authorized in Chapter 429 can be found in Section
429.021. It is important to read and understand the specific statutory provisions. Some provisions
are broader than the basic improvement. For example, a “street improvement” may also include
streetscape (beautification), storm sewers and utility connection lines. Other provisions may
contain important expansions or limitations on the authority. Sanitary and storm sewer
improvements may be made outside of the city limits.
The public improvements currently authorized in Chapter 429 include the following:
1. Acquire, open, and widen any street, and improve the same by constructing, reconstructing,
and maintaining sidewalks, pavement, gutters, curbs, and vehicle parking strips of any
material, or by grading, graveling, oiling, or otherwise improving the same, including the
beautification thereof and including storm sewers or other street drainage and connections
from sewer, water, or similar mains to curb lines.
2. Acquire, develop, construct, reconstruct, extend, and maintain storm and sanitary sewers
and systems, including outlets, holding areas and ponds, treatment plants, pumps, lift
stations, service connections, and other appurtenances of a sewer system, within and
without the corporate limits.
3. Construct, reconstruct, extend, and maintain steam heating mains.
4. Install, replace, extend, and maintain streetlights and street lighting systems and special
lighting systems.
5. Acquire, improve, construct, reconstruct, extend, and maintain water works systems,
including mains, valves, hydrants, service connections, wells, pumps, reservoirs, tanks,
treatment plants, and other appurtenances of a water works system, within and without
the corporate limits.
6. Acquire, improve, and equip parks, open space areas, playgrounds, and recreational
facilities within or without the corporate limits.
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7.Plant trees on streets and provide for their trimming, care, and removal.
8.Abate nuisances and drain swamps, marshes, and ponds on public or private property, and
fill the same.
9.Construct, reconstruct, extend, and maintain dikes and other flood control works.
10.Construct, reconstruct, extend, and maintain retaining walls and area walls.
11.Acquire, construct, reconstruct, improve, alter, extend, operate, maintain, and promote a
pedestrian skyway system. Such improvement may be made upon a petition pursuant to
section 429.031, subdivision 3.
12.Acquire, construct, reconstruct, extend, operate, maintain, and promote underground
pedestrian concourses.
13.Acquire, construct, improve, alter, extend, operate, maintain, and promote public malls,
plazas, or courtyards.
14.Construct, reconstruct, extend, and maintain district heating systems.
15.Construct, reconstruct, alter, extend, operate, maintain, and promote fire protection
systems in existing buildings, but only upon a petition pursuant to section 429.031,
subdivision 3.
16.Acquire, construct, reconstruct, improve, alter, extend, and maintain highway sound
barriers.
17.Improve, construct, reconstruct, extend, and maintain gas and electric distribution facilities
owned by a municipal gas or electric utility.
18.Purchase, install, and maintain signs, posts, and other markers for addressing related to the
operation of enhanced 911 telephone service.
19.Improve, construct, extend, and maintain facilities for Internet access and other
communications purposes, if the council finds that: (i) the facilities are necessary to make
available Internet access or other communications services that are not and will not be
available through other providers or the private market in the reasonably foreseeable
future; and (ii) the service to be provided by the facilities will not compete with service
provided by private entities.
20.Assess affected property owners for all or a portion of the costs agreed to with an electric
utility, telecommunications carrier, or cable system operator to bury or alter a new or
existing distribution system within the public right-of-way that exceeds the utility’s design
and construction standards, or those set by law, tariff, or franchise, but only upon petition
under section 429.031, subdivision 3.
21.Assess affected property owners for repayment of voluntary energy improvement
financings under section 216C.436, subdivision 7.
Other statutes may also authorize the use of special assessments to pay for improvements. For
example, authorized improvements within a Housing Improvement Area may be paid with special
assessments.
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Minimum Assessment
General Obligation Improvement Bonds require a minimum 20% assessment. It is important to
understand the method for determining the minimum assessment. A common assumption is that
assessments must equal or exceed 20% of the amount to be borrowed. While this calculation
works for Tax Increment Bonds, the 20% calculation for Improvement Bonds is different:
1. The assessment calculation is based on the cost of the improvement to the city. This cost
may or may not equal the amount of the Improvement Bonds.
2. The cost of the improvement does not include activities that will not be assessed to
benefitted property owners and not financed with G.O. Improvement Bonds. These
improvements can be made without following the procedures of Chapter 429. This
exclusion typically applies to utility (sanitary sewer, watermain, and storm sewer) im-
provements paid from reserves or bonds issued under Minnesota Statutes, Chapter 444.
3. The cost to the city excludes all monies contributed by other units of government to pay for
the improvement.
4. The up-front use of city non-utility reserves (both General Fund and capital improvement)
does not reduce the cost to the city.
One exception to this 20% requirement is improvements for automobile parking facilities (Section
459.14). Bonds issued to finance the construction or maintenance of automobile parking facilities
require special assessments in an amount not less than 50% of the amount of the bonds.
Assessment Considerations
State Law does not prescribe assessment methodology. Some cities have formal assessment
policies. Other cities deal with assessments on a project-by-project basis.
A guiding factor in setting assessments is the market value test. The amount assessed to a
property cannot exceed the increase in market value of the property because of the
improvement. There is no requirement to make this finding as part of the improvement process.
The issue comes into play primarily in projects with larger assessments and greater risk of appeal.
Assessments are also constrained by the notice of hearing for the improvement. The total
amount assessed cannot exceed the amount stated in the notice. The area assessed cannot be
larger, but can be smaller, than the area receiving notice of the Hearing.
The special assessment calculation is based on the “improvement.” An improvement may be
more than a single project. There are two ways to manage multiple projects into a single
improvement for the purposes of Chapter 429. Section 429.021, Subd. 2 allows for an
improvement on two or more streets, or two or more types of improvements, in or on the same
street or streets or different streets may be included in one proceeding and conducted as one
improvement. This combining of improvements is typically spelled out in the engineering
feasibility report and considered at the improvement hearing. Projects that are instituted
separately may be subsequently combined under the authority of Section 435.56.
Revenues to pay debt service on the portion that is not assessed may come from any legally
available source including a property tax levy.
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Bond Issues
Planning for the issuance of Improvement Bonds requires a clear understanding of the special
assessments. In addition to the total amount assessed, several other factors are important:
What is the term of repayment? First levy year payable? Total number of years payable?
Will the assessments be repaid with level annual installments of principal or level annual
payments of principal and interest?
What interest rate will be charged on the unpaid balance? Is it tied to the interest rate on
the bonds?
Will any of the assessments be deferred? If so, when will they be paid?
When is the assessment hearing and when will the assessments be certified to the County?
What are the expectations for the initial prepayment of assessments?
The timing of the improvement process is another important consideration. Improvement Bonds
can be issued any time after the city council conducts the improvement hearing and authorizes
the improvements. No improvement hearing is needed if the parties that petition for the
improvement will be assessed 100% of the cost. Each point in time has different implications for
issuing bonds:
Bonds issued soon after the improvement hearing will be based on estimated construction
costs and assumptions about special assessments.
Bonds may be issued immediately after the receipt of bids to provide construction
financing. The finance plan will rely on assumptions about special assessments.
Bonds may be issued after completion of the assessment process. This allows the finance
plan to be based on final construction costs and actual assessments. This approach can also
consider the number of initial prepayments. Delaying financing until after the assessment
process requires city funds to pay for construction and a reimbursement resolution to allow
the repayment of these funds with the proceeds of tax-exempt bonds.
For controversial projects with a higher risk of assessment appeals, cities will conduct the
assessment process during the period between the receipt and award of construction bids. This
approach allows the city to know the appeal risk before committing to undertake the
improvement. Improvement Bonds are not subject to the statutory debt limit.
Utility Revenue Bonds
Minnesota cities rarely issue pure Revenue Bonds to finance sanitary sewer, water, and storm
sewer utility improvements. State Law allows cities to add its general obligation to the pledge of
net utility revenues for these improvements (Section 444.075). G.O. Utility Revenue Bonds may
be issued to build, construct, reconstruct, repair, enlarge, improve, or in any other manner obtain
sanitary sewer, water, and storm sewer facilities, and maintain and operate the facilities inside
or outside its corporate limits.
These bonds are sometimes called “double barreled.” They are secured by both utility revenues
and the city’s general obligation. The bonds may be secured by a single utility or by combined
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utility funds. Debt service on Utility Revenue Bonds is paid from the net revenues of the utilities
pledged to secure the bonds. Special assessments may also be levied and pledged to the bonds.
Unlike Improvement Bonds, property taxes cannot be a permanent and ongoing source of
revenue to pay debt service. Property taxes should only be used on a temporary basis when the
other revenues are insufficient to meet the obligations.
It is important to understand the nature of the revenues that will be used to support the bonds.
How much of the revenue comes from connection charges and other fees associated with
growth?
Are rate increases needed? If so, are there any procedural issues (such as a public hearing
or approval by the utilities commission)?
Are there any large users that constitute a significant portion of the revenue base?
Are there special agreements with large users?
There are no special procedural requirements for the issuance of Utility Revenue Bonds.
Capital Improvement Plan Bonds
Cities may issue Capital Improvement Plan (CIP) Bonds to finance the construction and
maintenance of city hall, town hall, library, public safety facility, and public works facility (Section
475.521). These bonds may not be used to finance any other type of facility or improvement.
Expenditures for eligible capital improvements incurred before adoption of the capital
improvement plan are allowed if included in a plan approved at or prior to the public hearing on
the issuance of bonds.
The projects to be financed must be included in a capital improvements plan (CIP) that meets the
criteria of the statute. The plan must cover at least a five-year period beginning with the date of
its adoption. The plan must set forth the estimated schedule, timing, and details of specific capital
improvements by year, together with the estimated cost, the need for the improvement, and
sources of revenue to pay for the improvement. The CIP should also include information about
the factors required by the statute to be considered by the city council. These factors are:
Condition of the municipality’s existing infrastructure, including the projected need for
repair or replacement;
Likely demand for the improvement;
Estimated cost of the improvement;
Available public resources;
Level of overlapping debt in the municipality;
Relative benefits and costs of alternative uses of the funds;
Operating costs of the proposed improvements; and
Alternatives for providing services most efficiently through shared facilities with other
municipalities or local government units.
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The required CIP may be a document prepared specifically for authorizing the issuance of bonds
or it may be incorporated into other capital improvement planning by the city.
The maximum amount of CIP Bonds is limited. The maximum principal and interest payable in
any year for all outstanding CIP Bonds cannot exceed 0.16% of the estimated market value of
taxable property in the city. This calculation is made using the estimated market value for the
taxes payable year in which the bonds are issued and sold.
The bonds are subject to the debt limit for cities with a population of 2,500 or more. Both
approval of the CIP and the issuance of bonds require a public hearing. A single public hearing
may be held to meet these requirements. The bonds must be authorized by a three-fifths vote of
a five-member city council. If the city council has more than five members, two-thirds approval
is needed.
Issuance of the bonds is subject to reverse referendum. An election is required for the issuance
of the bonds if a petition signed by voters equal to 5% of the votes cast in the city in the last
municipal general election is filed with the city clerk within 30 days after the public hearing. If the
city does not submit the question to the voters, it may not propose the issuance of bonds under
this section for the same purpose and in the same amount for a period of 365 days from the date
of receipt of the petition. If the question of issuing the bonds is submitted and not approved by
the voters, the city must wait 180 days before voting on the same question again.
Lease Revenue Bonds
Lease Revenue Bonds are used by cities to finance public facilities. There is no specific statutory
authority for Lease Revenue Bonds. This form of financing combines two statutory powers.
Economic development authorities (EDA) and housing and redevelopment authorities (HRA)
have the authority to issue Revenue Bonds for their corporate purposes, including the
construction of public facilities. The security for the bonds and the revenue to pay debt service
comes from a lease purchase with the city. Not all public facilities are equally suited for the use
of Lease Revenue Bonds. As a general rule, the more essential the facility, the better the
application of this tool. This is due to the perception of investors that the city is less likely to not
appropriate and walk away from an essential facility.
A similar form of financing is Certificates of Participation. The investor receives a certificate
secured by a share of the lease payments. The underlying security is the same as Lease Revenue
Bonds. The status of the tax levy to make lease payments is another consideration in the use of
Lease Revenue Bonds. Under the most recent version of levy limits, the levy for Lease Revenue
Bonds can be made of a special levy and outside of levy limits. The special levy authority is to pay
debt service of another political subdivision, and the EDA is a political subdivision. Levies to make
lease payments do not currently qualify as a special levy and, therefore, are subject to levy limits.
The taxing power of the EDA may also be pledged to Lease Revenue Bonds.
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Other Debt Terms
Bank Qualified
Issuers that reasonably expect to issue $10,000,000 or less in tax-exempt bonds during a calendar
year may designate bonds as “bank qualified”. The name refers to the fact that banks may deduct
a portion of the interest cost on the carry purchased for its portfolio. This preferential tax
treatment usually results in lower interest rates than bonds that are not bank qualified. The
difference between bank qualified and not bank qualified rates varies over time and is typically
higher for longer maturities. Both the direct debt of the issuer and any conduit debt count against
the issuer’s $10,000,000 annual cap.
Arbitrage
Arbitrage regulations govern the ability to invest the proceeds of tax-exempt bonds. The basic
rule of arbitrage is that the gross proceeds of a bond issue may not be invested at a rate
“materially higher” than the yield on the bonds. The complexities of arbitrage calculation and
compliance are not discussed in this guide. Instead, this guide focuses on the three basic arbitrage
considerations for most Minnesota cities: construction fund, debt service fund, and arbitrage
rebate.
Arbitrage Rebate
Issuers must pay (rebate) to the federal government income earned in excess of the bond yield
unless subject to the small issuer or the spenddown exceptions.
The small issuer exception applies when the total principal amount of tax exempt, non-private
activity bonds does not exceed $5,000,000 in any calendar year. Current refunding bonds up to
the amount of the outstanding principal refunded do not count against this limit. There are three
options for meeting the spenddown exception:
1. 6-month exception - gross proceeds and interest earnings are allocated to expenditures for
governmental or qualified purposes that are incurred within 6 months after the date of
issuance.
2. 18-month exception - gross proceeds and interest earnings are spent within the following
schedule from date of issuance: (1) 15% within 6 months; (2) 60% within 12 months; and
(3) 100% within 18 months (with a 5% reasonable retainage carryover amount for an
additional 12 month period).
3. 2-year spending exception – issue is a “construction issue” (75% of issue is actually spent
on construction) and gross proceeds and interest earnings are spent within the following
schedule from date of issuance: (1) 10% within 6 months; (2) 45% within 12 months; (3)
75% within 18 months; and 4) 100% within 24 months.
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MINNESOTA STATUTES
DEBT LIMIT
475.53 LIMIT ON NET DEBT
Subdivision 1. Terms.
For the purposes of this chapter, the terms defined in this section shall have the meanings given
them.
Subd. 2. Municipality.
"Municipality" means a city of any class, county, town, or school district.
Subd. 3. Obligation.
"Obligation" means any promise to pay a stated amount of money at a fixed future date or
upon demand of the obligee, regardless of the source of funds to be used for its payment,
made for the purpose of incurring debt, including the purchase of property through an
installment purchase contract or any other deferred payment agreement, for which funds are
not appropriated in the current year's budget.
Subd. 4. Net debt.
"Net debt" means the amount remaining after deducting from its gross debt the amount of
current revenues which are applicable within the current fiscal year to the payment of any debt
and the aggregate of the principal of the following:
(1) Obligations issued for improvements which are payable wholly or partly from the
proceeds of special assessments levied upon property specially benefited thereby, including
those which are general obligations of the municipality issuing them, if the municipality is
entitled to reimbursement in whole or in part from the proceeds of the special assessments.
(2) Warrants or orders having no definite or fixed maturity.
(3) Obligations payable wholly from the income from revenue producing conveniences.
(4) Obligations issued to create or maintain a permanent improvement revolving fund.
(5) Obligations issued for the acquisition, and betterment of public waterworks systems,
and public lighting, heating, or power systems, and of any combination thereof or for any
other public convenience from which a revenue is or may be derived.
(6) Debt service loans and capital loans made to a school district under the provisions of
sections 126C.68 and 126C.69.
(7) Amount of all money and the face value of all securities held as a debt service fund for
the extinguishment of obligations other than those deductible under this subdivision.
(8) Obligations to repay loans made under section 216C.37.
(9) Obligations to repay loans made from money received from litigation or settlement of
alleged violations of federal petroleum pricing regulations.
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(10) Obligations issued to pay pension fund or other postemployment benefit liabilities
under section 475.52, subdivision 6, or any charter authority.
(11) Obligations issued to pay judgments against the municipality under section 475.52,
subdivision 6, or any charter authority.
(12) All other obligations which under the provisions of law authorizing their issuance are
not to be included in computing the net debt of the municipality.
PROPERTY TAX LEVY
275.08 AUDITOR TO FIX RATE.
Subdivision 1. Generally.
The rate percent of all taxes, except the state tax and taxes the rate of which may be fixed by
law, shall be calculated and fixed by the county auditor according to the limitations in this
chapter hereinafter prescribed; provided, that if any county, city, town, or school district shall
return a greater amount than the prescribed rates will raise, the auditor shall extend only such
amount of tax as the limited rate will produce.
Subd. 1a. Computation of tax capacity.
The county auditor shall compute the net tax capacity for each parcel according to the
classification rates specified in section 273.13. The net tax capacity will be the appropriate
classification rate multiplied by the parcel's market value.
Subd. 1b. Computation of tax rates.
(a) The amounts certified to be levied against net tax capacity under section 275.07 by an
individual local government unit shall be divided by the total net tax capacity of all taxable
properties within the local government unit's taxing jurisdiction. The resulting ratio, the
local government's local tax rate, multiplied by each property's net tax capacity shall be
each property's net tax capacity tax for that local government unit before reduction by any
credits.
273.032 MARKET VALUE DEFINITION.
For the purpose of determining any property tax levy limitation based on market value or any
limit on net debt, the issuance of bonds, certificates of indebtedness, or capital notes based on
market value, any qualification to receive state aid based on market value, or any state aid
amount based on market value, the terms "market value," "estimated market value," and
"market valuation," whether equalized or unequalized, mean the estimated market value of
taxable property within the local unit of government before any adjustments for tax increment,
fiscal disparity, powerline credit, or wind energy values, but after the limited market
adjustments under section 273.11, subdivision 1a, and after the market value exclusions of
certain improvements to homestead property under section 273.11, subdivision 16. Unless
otherwise provided, "market value," "estimated market value," and "market valuation" for
purposes of this paragraph, refer to the taxable market value for the previous assessment year.
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273.13 CLASSIFICATION OF PROPERTY.
Subdivision 1. How classified.
All real and personal property subject to a general property tax and not subject to any gross
earnings or other in-lieu tax is hereby classified for purposes of taxation as provided by this
section.
Subd. 21b. Tax capacity.
"Net tax capacity" means the product of the appropriate classification rates in this section and
taxable market values.
Subd. 22. Class 1.
(a) Except as provided in subdivision 23 and in paragraphs (b) and (c), real estate which is
residential and used for homestead purposes is class 1a. In the case of a duplex or triplex in
which one of the units is used for homestead purposes, the entire property is deemed to be
used for homestead purposes. The market value of class 1a property must be determined
based upon the value of the house, garage, and land.
The first $500,000 of market value of class 1a property has a net classification rate of one
percent of its market value; and the market value of class 1a property that exceeds
$500,000 has a classification rate of 1.25 percent of its market value.
(b) Class 1b property includes homestead real estate or homestead manufactured homes
used for the purposes of a homestead by:
(1) any person who is blind as defined in section 256D.35, or the person who is blind and
the spouse of the person who is blind;
(2) any person who is permanently and totally disabled or by the person with a disability
and the spouse of the person with a disability; or
(3) the surviving spouse of a veteran who was permanently and totally disabled
homesteading a property classified under this paragraph for taxes payable in 2008.
HOUSING AND REDEVELOPMENT AUTHORITY TAX LEVY
469.033 PUBLIC REDEVELOPMENT COST; PROCEEDS; FINANCING.
Subd. 6. Operation area as taxing district, special tax.
All of the territory included within the area of operation of any authority shall constitute a
taxing district for the purpose of levying and collecting special benefit taxes as provided in this
subdivision. All of the taxable property, both real and personal, within that taxing district shall
be deemed to be benefited by projects to the extent of the special taxes levied under this
subdivision. Subject to the consent by resolution of the governing body of the city in and for
which it was created, an authority may levy a tax upon all taxable property within that taxing
district. The tax shall be extended, spread, and included with and as a part of the general taxes
for state, county, and municipal purposes by the county auditor, to be collected and enforced
therewith, together with the penalty, interest, and costs. As the tax, including any penalties,
interest, and costs, is collected by the county treasurer it shall be accumulated and kept in a
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separate fund to be known as the "housing and redevelopment project fund." The money in the
fund shall be turned over to the authority at the same time and in the same manner that the
tax collections for the city are turned over to the city and shall be expended only for the
purposes of sections 469.001 to 469.047. It shall be paid out upon vouchers signed by the chair
of the authority or an authorized representative. The amount of the levy shall be an amount
approved by the governing body of the city but shall not exceed 0.0185 percent of estimated
market value. The authority shall each year formulate and file a budget in accordance with the
budget procedure of the city in the same manner as required of executive departments of the
city or, if no budgets are required to be filed, by August 1. The amount of the tax levy for the
following year shall be based on that budget.
469.001 PURPOSES.
The purposes of sections 469.001 to 469.047 are:
(1) to provide a sufficient supply of adequate, safe, and sanitary dwellings in order to
protect the health, safety, morals, and welfare of the citizens of this state;
(2) to clear and redevelop blighted areas;
(3) to perform those duties according to comprehensive plans;
(4) to remedy the shortage of housing for low- and moderate-income residents, and to
redevelop blighted areas, in situations in which private enterprise would not act without
government participation or subsidies; and
(5) in cities of the first class, to provide housing for persons of all incomes.
Public participation in activities intended to meet the purposes of sections 469.001 to 469.047
and the exercise of powers confined by sections 469.001 to 469.047 are public uses and
purposes for which private property may be acquired and public money spent.
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UTILITY RATES FOR 2024
Residential Water & Sprinklers: 10, 12, 16, 17, 30
0 - 1,000 gallons $9.37
1,001 - 6,500 gallons (5,500 gallons)$2.19/1,000 gallons
6,501 - 11,500 gallons (5,000 gallons)$2.54/1,000 gallons
11,501 - 16,500 gallons (5,000 gallons)$2.79/1,000 gallons
16,501 - 33,000 gallons (16,500 gallons)$3.02/1,000 gallons
33,001 gallons and over $3.24/1,000 gallons
Commercial Water & Sprinklers: 11, 13, 90, 31, 32, 90, 91, 92, 93
0 - 1,000 gallons $9.37
1,001 - 6,500 gallons (5,500 gallons)$2.19/1,000 gallons
6,501 - 33,000 gallons (26,500 gallons)$2.54/1,000 gallons
33,001 gallons and over $2.79/1,000 gallons
Industrial Water: 14 (effective 7/1/24)
All Water Usage $2.67/1,000 gallons
State Water Service Connection Fee: 18
Per Connection $0.81/mo.
Sewer Rates - Residential & Commercial: 20, 25, 26
0 - 1,000 gallons $10.93
1,001 gallons and over $6.71/1,000 gallons
Sewer Special Cases: SW21, SW22
Has own well $10 per person
Industrial Sewer Rates: 24 (effective 7/1/24)
All Sewer Usage $4.16/1,000 gallons
BOD5 (Biochemical Oxygen Demand)$0.449/lb.
TSS (Total Suspended Solids)$0.617/lb.
Testing Actual cost + 10%
Stormwater Rates:
Residential: 40 $4.75
Non-Residential (7 drainage units per impervious acre): 41 $4.75
Residential Garbage Charges - Taxable (effective 2/1/24)
1st Individual Residential Cart $10.38
2nd Individual Residential Cart $13.00
Residential Recycling Charges (effective 2/1/24)
Per Cart $5.50
Other:
Water On/Off Charge $25/each
Water Availability Charge: 15 $43/year
Final Bill Processing Fee $25.00
Refusal of Equipment (manual read) Charge $50.00
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CAPITALIZATION THRESHOLDS & USEFUL LIVES
Class of Asset Details
Useful
Life (Yrs)
Threshold
Land N/A $1
Land improvements 10-20 $50,000
Building/building improvements: 12-40 $20,000
Construction Interior & Roof Cover
Heating Ventilation AC & Lighting
Electrical
Elevators, Fire, Piping & Plumbing
Site Preparation
Floor Structure & Cover, Foundation, Roof
Structure, Steel Frame, Walls Exterior
Primary Infrastructure and Utility 10-40 $75,000
Paving Systems
Water, Sanitary & Stormwater
Secondary Infrastructure 10-40 $25,000
Sidewalk, Boardwalk, Pathways
Streetlights, Signage
Equipment 5-20 $10,000
Vehicles
Machinery
Software and
non-tangible 5-20 $10,000
Purchased and internally developed
Construction Work in Progress
Upon completion,
per above class
Equipment expenditures for items between $500 and $10,000 are recorded as small tools and
equipment, which is a supply account. Building and improvement expenditures below the
thresholds are recorded as repairs and maintenance. Current revenues finance expenditures for
supplies, repairs, and maintenance.
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TAX CAPACITY, TAX LEVY, & TAX RATE HISTORY
Tax Capacity City Tax HRA Tax Total Tax City Tax
Year Value Levy Levy Levy Capacity Rate
2015 23,882,689$ 8,535,000$ -$ 8,535,000$ 35.737
2016 25,891,898$ 8,925,000$ 280,000$ 9,205,000$ 34.470
2017 27,583,160$ 9,150,000$ 280,000$ 9,430,000$ 33.172
2018 29,528,145$ 9,547,000$ 323,000$ 9,870,000$ 32.332
2019 29,076,227$ 9,962,000$ 348,000$ 10,310,000$ 34.262
2020 29,870,392$ 10,445,000$ 355,000$ 10,800,000$ 34.968
2021 31,026,583$ 11,063,700$ 366,300$ 11,430,000$ 35.659
2022 31,073,603$ 11,353,000$ 388,000$ 11,741,000$ 36.536
2023 34,393,769$ 12,050,000$ 402,000$ 12,452,000$ 35.035
2023 37,229,832$ 13,074,000$ 451,000$ 13,525,000$ 35.117
$-
$5
$10
$15
$20
$25
$30
$35
$40
2015 2016 2017 2018 2019 2020 2021 2022 2023 2023MillionsTax Levies and Tax Capacity History
City Tax Levy HRA Tax Levy Tax Capacity Value
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USEFUL TERMS (GLOSSARY)
ACCOUNT: An organizational or budgetary breakdown found within city funds. A term used to
identify an individual asset, liability, expenditure (and other uses), revenue (and other sources),
or fund balance.
ACCOUNTS PAYABLE: Amounts owed to others for goods or services received.
ACCOUNTS RECEIVABLE: Amounts due from others for goods furnished or services rendered.
ACCOUNTING SYSTEM: The total set of records and procedures which are used to record,
classify, and report information on financial status and operations of an entity.
ACCRUAL BASIS OF ACCOUNTING: The method of accounting under which revenues are
recorded when they are earned, and expenditures are recorded when goods and services are
received.
ACTIVITY: A specific and distinguishable line of work performed by one or more organizational
components of a governmental unit for the purpose of accomplishing a function for which the
governmental unit is responsible. For example, "Ice & Snow Removal” is an activity performed
as part of the "Public Works" function.
AD VALOREM: In proportion to value. The basis for levying taxes on property.
AGENCY FUND: A fiduciary fund used to account for situations where the government’s role is
purely custodial.
AMERICAN RESCUE PLAN ACT (ARPA): Signed into law on March 11, 2021, this $1.9 trillion
funding program provided resources for a wide variety of recipients and for an extensive list of
uses. $350 billion of the funds were provided to state and local governments for emergency
funding in response to the COVID-19 pandemic.
AMORTIZATION: The action or process of gradually writing off the initial cost of an asset.
ANNUAL COMPREHENSIVE FINANCIAL REPORT (ACFR): A set of financial statements for a
governmental entity that comply with the accounting requirements established by the
Governmental Accounting Standards Board (GASB) and are audited by an independent auditor
using generally accepted government auditing standards.
APPROPRIATION: An authorization granted by a legislative body to make expenditures and to
incur obligations for specific purposes. An appropriation is limited in amount to the time it may
be expended.
ARBITRAGE: The simultaneous purchase and sale of the same asset in different markets in
order to profit from tiny differences in the asset's listed price. In governments, this typically
refers to the investment of funds received as proceeds from bond issuances.
ASSESSED VALUATION: Value placed upon real estate or other property as a basis for levying
taxes.
ASSESSMENTS: Charges made upon parties for actual services or benefits received.
ASSETS: Property owned by a governmental unit, which has a monetary value.
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ASSIGNED FUND BALANCE: Resources the government intends to use for specific purposes but
are neither restricted nor committed.
AUDIT: The examination of documents, records, reports, systems of internal control,
accounting and financial procedures, and other evidence for one or more of the following
purposes: a) To attest to whether the statements prepared from the accounts present fairly the
financial position and the results of financial operations of the constituent funds and balanced
account groups of the city in accordance with generally accepted accounting principles
applicable to city and on a basis consistent with that of the preceding year; b) To determine the
propriety, legality, and mathematical accuracy of a governmental unit's financial transactions;
c) To ascertain whether all financial transactions have been properly recorded; d) To evaluate
the stewardship of public officials who handle and are responsible for the financial resources of
a governmental unit.
BALANCED BUDGET: A budget in which estimated revenues and other sources equals
estimated expenditures and other uses. A balanced budget does not use reserves or retained
earnings to fund expenditures.
BERTRAM CHAIN OF LAKES REGIONAL PARK (BCOL): One of Monticello’s “Big 6” projects which
is a regional park with 4 lakes, acres of undisturbed shoreline, natural habitat, and oak forest,
blending passive natural recreation with active athletic and recreational play areas.
BOND: A written promise, generally under seal, to pay a specified sum of money, called the
face value or principal amount, at a fixed time in the future, called the date of maturity, and
carrying interest at a fixed rate, usually payable periodically.
BONDED INDEBTEDNESS: Outstanding debt by issues of bonds, which are repaid by ad valorem
taxes or other revenue.
BUDGET: A plan of financial operation embodying an estimate of proposed expenditures for a
given period and the proposed means of financing them.
BUDGET MESSAGE: A general discussion of the proposed budget presented in writing as a part
of the budget document. The budget message explains principal budget issues against the
background of financial experience in recent years and presents recommendations made by city
staff.
BUDGET CALENDAR: The schedule of key dates, which a government follows in the preparation
and adoption of the budget.
BUDGETARY CONTROL: The control or management of a governmental unit or enterprise in
accordance with an approved budget for the purpose of keeping expenditures within the
limitation of available appropriations and available revenues.
CAPITAL ASSETS: Assets used in operations and have initial useful lives extending beyond a
single reporting period. These assets must also meet capitalization thresholds, which vary by
asset classification and typically costs more than $10,000. Land, improvements to land,
vehicles, machinery, equipment, infrastructure, and other tangible and intangible assets used in
operations are examples of capital assets.
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CAPITAL EXPENDITURES: A capital expenditure occurs when a capital asset is purchased.
Expenditures that do not benefit more than one reporting period or meet the capitalization
thresholds are classified as current expenditures.
CAPITAL IMPROVEMENT BUDGET: A plan of proposed capital expenditures and a means of
financing them. The capital improvement budget is enacted as part of the complete annual
budget.
CAPITAL INPROVEMENT PLAN (CIP): A plan for capital expenditures to be incurred each year
over a fixed period of years to meet capital needs arising from the long-term work program or
otherwise. It sets forth each project or other contemplated expenditure in which the
government is to have a part and specifies the full resources estimated to be available to
finance the projected expenditures.
CAPITAL PROJECTS FUNDS: A governmental fund type used to account for financial resources
to be expended for the acquisition or construction of major capital assets.
CAPITALIZATION THRESHOLD: The level at which an item is considered either a current
expenditure or a capital expenditure. The threshold for equipment is $10,000.
CASH BASIS: The method of accounting under which revenues are recorded when received in
cash and expenditures are recorded when paid.
CHART OF ACCOUNTS: The classification system used by a government entity to organize the
accounting for various funds and departments.
COMMITTED FUND BALANCE: Resources used for specific purposes pursuant to constraints
imposed by formal action of the government’s highest level of decision-making authority (i.e.,
City Council).
CONSUMER PRICE INDEX (CPI): A statistical description of price levels provided by the U.S.
Department of Labor. The index is used as a measure of the increase in the cost of living (i.e.,
economic inflation).
CONTINGENCY: Budget for expenditures which cannot be placed in departmental budgets,
primarily due to uncertainty about the level or timing of expenditures when the budget is
adopted. The contingency also serves as a hedge against shortfalls in revenues or unexpected
expenditures.
CURRENT: A term applied to budgeting and accounting, designating the operations of the
present fiscal period as opposed to past or future periods including expenditures that do not
benefit more than one reporting period or meet the capitalization thresholds.
DEBT: An obligation resulting from borrowing money or purchasing goods and services.
DEBT LIMIT: The maximum amount of gross or net debt, which is legally permitted.
DEBT MARGIN: The amount of available debt, which may be issued by a governmental unit
before reaching its debt limit.
DEBT SERVICE FUND: A governmental fund type used to account for the accumulation of
resources for the payment of general long-term debt principal and interest. Proprietary fund
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type debt is accounted for in the enterprise fund or internal service fund receiving the debt
issue proceeds.
DEFICIT: An excess of expenditure or liabilities over income or assets in a given period.
DEPARTMENT: Basic organizational unit of government, responsible for carrying out related
functions. Each department serves a specific function as a distinct organizational unit of
government within the given fund. Its primary purpose is to facilitate organizational and
budgetary accountability.
DEPRECIATION: Expiration in the service life of capital assets attributable to wear and tear,
deterioration, action of the physical elements, inadequacy, or obsolescence.
DEPARTMENT OF MOTOR VEHICLES (DMV): Also known as Deputy Registrar. City service of
processing state-issued licenses for motor vehicles and equipment, such as license plates and
tabs for cars, trucks, trailers, and recreational vehicles.
DISTINGUISHED BUDGET PRESENTATION AWARDS PROGRAM: A voluntary awards program
administered by the Government Finance Officers Association to encourage governments to
prepare effective budget documents.
ECONOMIC DEVELOPMENT AUTHORITY (EDA): A board responsible for the on-going
Development and redevelopment efforts within the city. This consists of housing and
businesses, including all related public improvements and land acquisitions.
ENTERPRISE FUND: A proprietary fund type used to report an activity for which a fee is charged
to external users for goods or services. In theory, these funds operate in a manner similar to
private business enterprises, where the intent of the governing body is to recover the cost of
delivering services through user fees or charges (Water, Sewer, Liquor, Deputy Registrar, and
Fiber Optic funds).
ESTIMATED MARKET VALUE (EMV): Represents the selling price of a property if it were on the
market. Estimated market value is converted to tax capacity before property taxes are levied.
EXPENDITURE: For accounts kept on the accrual or modified accrual basis of accounting, the
cost of goods received, or services rendered whether cash payment have been made or not.
Where accounts are kept on a cash basis, expenditures are recognized only when the cash
payments for the above purposes are made.
FIBERNET MONTICELLO (FNM): The name of the city-owned fiber optic network, which
provides internet, phone, and cable television to residents and businesses of Monticello.
FIDUCIARY FUND: A fund classification used to report assets held in a trustee or agency
capacity for others and therefore cannot be used in the government’s own programs.
FINES: Revenues from penalties imposed for violation of laws or regulations.
FISCAL POLICY: A government’s policies with respect to revenues, spending, and debt
management as these relate to government services, programs, and capital investment. Fiscal
Policy provides an agreed-upon set of principles for the planning and programming of budgets
and their funding.
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FISCAL YEAR: The budget and accounting year that begins on the first day of January and ends
on the last day of December of each year.
FULL TIME EQUIVALENT (FTE): The number of employee hours (2,080) needed to be equal to
one full time employee. Several part time employees may be combined to make one FTE.
FUNCTION: A group of related activities aimed at accomplishing a major service or regulatory
program for which the government unit is responsible.
FUND: A fiscally independent accounting entity with a self-balancing set of accounts recording
cash and/or other resources together with all related liabilities, obligations, and reserves, which
are segregated for the purpose of carrying on specific activities or attaining certain objectives.
Funds in the government model are classified into three broad categories: governmental,
proprietary, and fiduciary. The most common reason for establishing a fund is to separately
account for restricted-use revenue or to comply with state or federal law.
FUND BALANCE: Governmental fund assets and deferred outflows of resources minus liabilities
and deferred inflows of resources.
GENERAL FUND: Accounts for the general operation of the city and all financial resources
except those to be accounted for in another fund.
GENERAL GOVERNMENT: A set of accounts, to which the expenditures for operating the city
are charged.
GENERAL OBLIGATION (GO) BONDS: Bonds for which the government pledges its full faith and
credit to the repayment of the bond’s principal, including interest.
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP): A set of accounting rules, standards,
and procedures.
GEOGRAPHIC INFORMATIONS SYSTEMS (GIS): A system that creates, manages, analyzes &
maps all types of data.
GOVERNMENT FINANCE OFFICERS ASSOCIATION (GFOA): A professional association of state,
provincial, and local government finance officers in the United States and Canada.
GOVERNMENTAL ACCOUNTING: The composite of analyzing, recording, summarizing,
reporting, and interpreting the financial transactions of governmental units and agencies.
GOVERNMENTAL ACCOUNTING STANDARDS BOARD (GASB): A private organization creating
generally accepted accounting principles for state and local governments.
GOVERNMENTAL FUND TYPES: Funds generally used for tax-supported activities. Under
current GAAP, there are five governmental fund types in this: general, special revenue, debt
service, capital projects, and permanent funds. The city has no permanent funds.
GRANT: A contribution of assets by one governmental unit or other organization to another.
HOMESTEAD AND AGRICULTURAL CREDIT (HACA): A form of state-paid property tax relief for
farm property and owner-occupied homes.
HOUSING AND REDEVELOPMENT ACT – SPECIAL BENEFIT LEVY: Property tax levied against the
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city’s taxable market value. The HRA levy limit is .0185% of the taxable market value and must
be used solely for redevelopment purposes.
HOUSING AND REDEVELOPMENT AUTHORITY (HRA): A legally distinct public entity which
undertakes housing, commercial and business redevelopment activities.
IMPROVEMENT BONDS: Bonds payable from the proceeds of special assessments from
properties benefiting from an improvement.
IMPROVEMENTS: Buildings, structures, and other attachments or annexations to land which
are intended to remain so attached or annexed, such as sidewalks, trees, drains, and sewers.
INDUSTIAL & ECONOMIC DEVELOPMENT COMMITTEE (IEDC): A volunteer organization
appointed by the Monticello City Council which advocates for industrial and economic growth
within the city of Monticello by promoting awareness and communication efforts on behalf of
the business community.
INFRASTRUCTURE: The basic physical and organizational structures and facilities (e.g.,
buildings, roads, bridges) needed for the operation of the city. Infrastructure thus consists of
improvements with significant cost to develop or install that return an important value over
time to the city.
INTERFUND OPERATING TRANSFERS: Amounts transferred from one fund to another, shown as
an expenditure in the originating fund and a revenue in the receiving fund.
INTERGOVERNMENTAL REVENUES: Revenues from other governments in the form of grants,
entitlement, or shared revenues.
INTERNAL SERVICE FUNDS: A proprietary fund type used to report activity that provides goods
or services to other funds, departments, or agencies of the primary government and its
component units, or to other governments, on a cost-reimbursement basis.
LEVY: (Verb) To impose taxes, special assessments, or service charges for the support of
governmental activities. (Noun) Taxes, special assessments, or service charges imposed by a
governmental unit.
LEVY LIMIT: The city’s maximum property tax levy without special authorization as defined by
Minnesota State Statue.
LINE ITEM: A specific item or group of related items defined by detail in a unique account in the
financial records.
LOCAL GOVERNMENT AID (LGA): Intergovernmental revenue from the state to municipalities
to help fund general expenditures.
LONG-TERM DEBT: Debt with a maturity of more than one year after the date of issuance.
MAINTENANCE: The upkeep (repairs and maintenance) of physical properties in condition for
use or occupancy.
MAJOR FUND: For budgetary purposes, a fund whose revenues or expenditures, excluding
other financing sources and uses, constitute more than 10% of the revenues or expenditures of
the appropriated budget.
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MARKET VALUE: An assessor’s estimate of what property would be worth on the open market
if sold. The market value is set on January 2 of the year before taxes are payable.
MARKET VALUE EXCLUSION (MVE): Provision in the state property tax system which exempts
or removes a portion of a property’s market value from property taxes.
MISCELLANEOUS: Revenues or expenditures not classified in any other revenue or expenditure
category.
MODIFIED ACCRUAL BASIS: The basis of accounting under which expenditures other than
accrued interest on general long-term debt are recorded at the time liabilities are incurred and
revenues are recorded when received in cash except for material and/or available revenues,
which should be accrued to reflect properly the tax levied, and revenue earned.
MONTICELLO COMMUNITY CENTER (MCC): A beautiful, full-service facility with activities,
programs, and events including a pool & waterslide, fitness center, gymnasium, fitness classes,
climbing wall, indoor play area, and meeting rooms.
NON-MAJOR FUND: For budgetary purposes, a fund whose revenues and expenditures,
excluding other financing sources and uses, are less than 10% of the revenues and expenditures
of the appropriated budget.
NONSPENDABLE FUND BALANCE: Amounts that cannot be spent because they are either (a)
not in spendable form or (b) legally or contractually required to be maintained intact.
Nonspendable fund balances typically include inventory, prepaid items, and land held for
resale.
OBJECT OF EXPENDITURE: Expenditure classifications based upon the types of items purchased
or services obtained. Examples of objects of expenditure include salaries, supplies, contracted
service, etc.
OBJECTIVE: Desired output-oriented accomplishments, which can be measured and achieved
within a given period.
OPERATING BUDGET: A financial plan that estimates revenues and expenditures for a specified
period.
OPERATING EXPENSE: The cost for personnel, materials, and equipment required for a
department to function.
OPERATING REVENUE: Monies received from ongoing operations. Operating revenues are used
to pay for day-to-day services.
ORDINANCE: A formal legislative enactment by the City Council.
PAID TIME OFF (PTO): Compensated time away from work, provided by an employer to
employees for them to use as they see fit.
PAY-AS-YOU-GO BASIS: A term used to describe a financial policy by which capital outlays are
financed from current revenues rather than through borrowing.
PERSONNEL SERVICES: Expenditures for salaries, wages, and fringe benefits of employees.
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PROGRAM: A group of related activities performed by one or more organizational units for the
purpose of accomplishing a function for which the governmental unit is responsible.
PROJECT: A plan of work, job assignment, or task.
PROPERTY TAX LEVY: The total amount to be raised by general property taxes for the purpose
stated in the resolution certified to the county auditor by December 28th. Also see levy.
PROPRIETARY FUNDS: Funds focusing on the determination of operating income, changes in
net position (or cost recovery), financial position, and cash flows. There are two types of
proprietary funds: enterprise funds and internal service funds. For this report, these funds have
the same budgetary basis as governmental funds.
PUBLIC SAFETY: Expenditures related to the protection of persons and property.
PUBLIC WORKS: Expenditures for the maintenance of city property and infrastructure.
REFUNDING BONDS: Bonds issued to redeem outstanding (unpaid) debt.
REIMBURSEMENT: Cash or other assets received as a repayment of the cost of work or services
performed or of other expenditures made for or on behalf of another governmental unit or
department or for an individual, firm, or corporation.
RESERVE: An account which records a portion of the fund balance which must be segregated
for some future use, and which is, therefore, not available for further appropriation or
expenditure.
RESOLUTION: A special or temporary order of a legislative body; an order of a legislative body
requiring less legal formality than an ordinance or statute.
RESOURCES: The actual assets of a governmental unit, such as cash, plus contingent assets such
as estimated revenues applying to the current fiscal year not accrued or collected, and bonds
authorized and not issued.
RESTRICTED FUND BALANCE: Fund balance should be reported as restricted when constraints
placed on the use of resources are either: a) externally imposed by creditors (such as through
debt covenants), grantors, contributors, or laws or regulations of other governments; or b)
imposed by law through constitutional provisions or enabling legislation.
REVENUE: The term designates an increase to a fund's assets which: 1) does not increase a
liability; 2) does not represent a repayment of an expenditure already made; 3) does not
represent a cancellation of certain liabilities; and 4) does not represent an increase in
contributed capital.
REVENUE BOND: A bond that is backed by a particular revenue source such as water user fees,
typically accounted for in proprietary fund types.
SMALL CITIES DEVELOPMENT PROGRAM (SCDP): A program run by the State of Minnesota
which helps cities and counties with funding for housing, public infrastructure and commercial
rehabilitation projects. Monticello operates a special revenue fund to administer funds from
this program.
SPECIAL ASSESSMENT: A compulsory levy made by a local government against certain
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properties to defray part or all the cost of a specific improvement or service which is presumed
to be of general benefit to the public and of special benefit to such properties.
SUPERVISORY CONTROL AND DATA ACQUISITION (SCADA): System used for controlling,
monitoring, and analyzing industrial devices and processes, including for water and sewer
systems.
SPECIAL REVENUE FUND: A governmental fund type used to account for revenue derived from
specific revenue sources that are legally restricted or committed for specific purposes.
TAX CAPACITY: The valuation of property based on market value and statutory class rates. The
property tax for each parcel is based on its tax capacity. The total tax capacity of all individual
parcels is the basis for determining the tax capacity rate.
TAX CAPACITY RATE: Tax rate applied to tax capacity to generate property tax revenue. The
rate is obtained by dividing the property tax levy by the available tax capacity.
TAX INCREMENT FINANCING (TIF): Financing tool originally intended to combat severe blight in
areas, which would not be redeveloped without government subsidies derived from locally
generated property tax revenues.
TAXABLE MARKET VALUE: The market value of a property less the market value exclusion. This
is the value used to calculate property taxes on a property.
TAXES: Compulsory charges levied by a governmental unit for the purpose of financing services
performed for the common benefit.
TOTAL TAX CAPACITY: The amount computed by first totaling the tax capacities of all parcels of
property within a city. Adjustments for fiscal disparities, tax increment, and a portion of the
powerline value are made to this total since not all tax capacity is available for general tax
purposes.
TRUST FUND: A fund consisting of resources received and held by the governmental unit as
trustee, which is to be expended or invested in accordance with the conditions of the trust.
UNASSIGNED FUND BALANCE: This is the residual classification for the General Fund. This is
fund balance that has not been reported in any other classification. The General Fund is the
only fund that can report a positive unassigned fund balance. Other governmental funds would
report deficit fund balances as unassigned.
UNBALANCED BUDGET: A budget in which undesignated fund balance or reserves are used or
increased, to balance estimated revenues to estimated expenditures or expenses.
UNRESTRICTED FUND BALANCE: The portion of a fund’s balance that is not restricted for a
specific purpose and is available for general appropriation.
WORKING CAPITAL: Current assets less current liabilities. The modified accrual balance of
resources in enterprise funds after factoring out long-term assets and liabilities that do not
impact current, near-term operations.
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ACRONYMS
ACFR Annual Comprehensive Financial Report
ARPA American Rescue Plan Act
BCOL Bertram Chain of Lakes
CIP Capital Improvement Plan
CPI Consumer Price Index
CSAH County State Aid Highway
DMV Department of Motor Vehicles
EDA Economic Development Authority
EMV Estimated Market Value
FNM FiberNet Monticello
FTE Full Time Equivalent
GAAP Generally Accepted Accounting Principles
GASB Governmental Accounting Standards Board
GFOA Government Finance Officers Association
GIS Geographic Information System
GO General Obligation (Bonds)
HACA Homestead and Agricultural Credit Aid
HRA Housing and Redevelopment Authority
IEDC Industrial & Economic Development Committee
LGA Local Government Aid
MCC Monticello Community Center
MVE Market Value Exclusion
PTO Paid Time Off
SCADA Supervisory Control and Data Acquisition
SCDP Small Cities Development Program
TIF Tax Increment Financing
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2024 Budget