2016 Monticello MN PAFRCITY OF MONTICELLO
505 WALNUT STREET, SUITE #1
MONTICELLO, MN 55362
PHONE: 763.295.2711
FAX: 763.295.4404
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Financial Report Message
We are pleased to present the city of Monticello’s second Popular Annual
Financial Report (PAFR). The PAFR is a condensed version of the 2016
Comprehensive Annual Financial Report (CAFR), and as such, does not include
information on all the city's funds.
The CAFR is a detailed account of the city's financial statements, notes,
schedules, and statistics. The CAFR was prepared in conformance with
Generally Accepted Accounting Principles (GAAP), audited by Malloy,
Montague, Karnowski, Radosevich, & Co. P.A. and received an unmodified
(clean) opinion. A copy of the CAFR can be found on the city's website at
www.ci.monticello.mn.us
This report provides a summary of the financial position of the city and shows
where revenues come from to operate the city and where those dollars are
spent. The report is presented in an effort to inform citizens and other interested
parties about the financial operations of the city in a simplified and easy−to−read
format.
Thank you for your interest in your government and its functions. Please feel
free to share any questions or comments on the PAFR with Finance Director
Wayne Oberg at wayne.oberg@ci.monticello.mn.us or Finance Manager Sarah
Rathlisberger at sarah.rathlisberger@ci.monticello.mn.us.
Respectfully submitted,
Wayne Oberg
Finance Director
Sarah Rathlisberger
Finance Manager
City Profile
The city of Monticello, organized as a municipality
in 1856, has the Mississippi River has its north
border. The city is located approximately 45 miles
northwest of the Minneapolis/St. Paul metropolitan
area along the I-94 corridor in Wright County. The
city benefits from the employment opportunities
offered in the area and the relatively low
unemployment rate of 4.3%.
The city provides its residents and businesses with a full range of municipal
services consisting of law enforcement (Wright County Sheriff) and fire
protection, the construction and maintenance of streets and other
infrastructure, a community center for recreation activities, park construction
and maintenance, and general administrative services. In addition, the city
operates five enterprises: a water utility, a sewage utility, liquor store,
deputy registrar (DMV) and a fiber optics utility (FiberNet).
Contact Us!
There are many ways to
connect:
Phone 763.295.2711
www.ci.monticello.mn.us
Facebook – City of
Monticello, MN
Inside:
Financial Report
Message & City Profile.......1
City Organization &
Economic Outlook….……...2
Major Projects and
Initiatives............................3
Net Position…………….......4
Fund Accounting……….…..5
General Fund……………..6
Special revenue funds:
Community Center &
EDA………………..........7
All governmental funds.….8
Debt Management……..….8
Enterprise Funds..……...…9
Tax Levy…………………..12
Largest Taxpayers,
Employers, and
Customers…....................13
Useful Terms……………..14
Awards…………………….15
Finance Department:
Julie Cheney……...Finance Assistant
RaeLynn Cook……….....Payroll Clerk
Debbie Davidson………Finance Clerk
Pat Kovich…...Utility Billing Specialist
Sarah
Rathlisberger…….Finance Manager
Wayne Oberg……...Finance Director
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City Organization
The city operates under the mayor-council form of government. The five-
member city council is elected on a nonpartisan basis. The mayor is elected to
serve a two-year term. Councilmembers serve four-year staggered terms, with
two councilmembers elected every two years.
The City Council includes:
Mayor Brian Stumpf brian.stumpf@ci.monticello.mn.us
Councilmember Jim Davidson jim.davidson@ci.monticello.mn.us
Councilmember Bill Fair bill.fair@ci.monticello.mn.us
Councilmember Charlotte Gabler charlotte.gabler@ci.monticello.mn.us
Councilmember Lloyd Hilgart lloyd.hilgart@ci.monticello.mn.us
To email all councilmembers:
allcitycounciladdress@ci.monticello.mn.us
Policy-making and legislative
authority are vested in the city
council. The council is responsible
for passing policies, ordinances,
and resolutions. The council
adopts the annual tax levy and
budget. Council appointed boards,
commissions and committees
usually include at least one
councilor. A council-appointed city
administrator is responsible for
implementing policies and for
providing general operational
oversight.
Pictured: (Top left to right) Charlotte Gabler, Brian Stumpf, Lloyd Hilgart
(Bottom left to right) Bill Fair and Jim Davidson
Economic Outlook
The city of Monticello continues to grow! In 2016, the city issued 61 permits for
new homes, compared to 38 in 2015, 69 in 2014, and 49 in 2013. However, the
number of buildable lots is declining. At the end of 2016, the city had fewer than
50 lots available for single−family homes.
For 2016, the city's population is estimated at 13,299, up 540, or about 4%, from
the 2010 Census number of 12,759. The city currently occupies 8.9 square
miles, but could ultimately expand to 20.8 square miles as portions of Monticello
Township are annexed through an orderly annexation agreement.
Τhe city's estimated market value of all properties within the city grew from
$1.71 billion to $1.83 billion at the end of 2016. Xcel Energy improvements at its
nuclear power plant and increases in residential market values were the primary
contributors to the increase. Valued at $15 million, the city issued a new
commercial permit for Fleet Farm. Construction for this permit started in 2016.
City Departments and
Staff
Administration
City Administrator
-Jeff O’Neill
City Clerk
-Jennifer Schreiber
Human Resources
-Tracy Ergen
Communications
-Rachel Leonard
Planning
Community
Development Director
-Angela Schumann
Building Official
-John Rued
Building Inspector
-Ron Hackenmueller
Finance
Finance Director
-Wayne Oberg
Finance Manager
-Sarah Rathlisberger
DMV Manager
-Carolyn Granger
Liquor Store Manager
-Randall Johnsen
Public Works
Street Superintendent
-Tom Moores
Utilities Superintendent
-Matt Theisen
Park Superintendent
-Tom Pawelk
Fire
Fire Chief
-Michael Mossey
Community Center
MCC Director
-Ann Mosack
Operations Manager
-Sara Cahill
Event Coordinator
-Tricia Menth
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Major Projects and Initiatives
2016 Major Projects and Initiatives
•Levy of a new HRA property tax ($280,000) to support redevelopment expenditures in the EDA fund.
This levy is limited to .0185% of the city’s taxable valuation.
•Continued working on a wastewater treatment plant phosphorous reduction project, which includes
replacement of two digester covers. This project is expected to be fully completed in 2017.
•Started construction on the city’s core street project east of trunk highway 25 and north of I-94.
•Constructed the improvements at the intersection of trunk highway 25 and county highway 75. This
project improved traffic flow through the addition of turn lanes.
•Constructed a retaining wall along the south side of Hillside Cemetery on 7th Street.
•Enhanced an unparalleled system of parks, trails and recreational facilities with the final land
acquisition for the Bertram Chain of Lakes Regional Park, installation of fencing for a dog park,
and improvements to the Par West and Ellison park structures.
•Through land acquisition and public improvement projects, continued the implementation of the
downtown redevelopment plan providing for a downtown area that combines a successful commercial
district, community identity and heritage, and connection to the Mississippi River.
Future Projects and Initiatives
•Complete the aeration blower, and close out, the wastewater treatment project.
•Continue park improvements at the Bertram Chain of Lakes in 2017 or 2018.
•Acquire land and right-of-way needed for the Fallon Avenue bridge over I-94 and the 95th
Street extension.
•Complete the overpass over I-94 of Fallon Avenue including the construction of two
roundabouts on 7th Street and one roundabout on Chelsea Road.
•Continue the intersection improvements at the corner of 7th Street and trunk highway 25. The
installation of a cemetery retaining wall along 7th Street will improve traffic flow through this
intersection.
•Explore avenues to improve delivery of all city services, including those provided by the city-
owned telecommunication utility.
The city has developed a long-term financial model for its four major
operating funds: General, Community Center, Water, and Sewage.
All four funds operate in a relatively stable environment and no large
adjustments to taxes or user charges are anticipated. The city has also developed a Capital Improvement
Program (CIP) plan, which is a five-year forecast of the city’s facility, equipment and infrastructure needs.
Items in the first year of the CIP are incorporated into the annual budget. Items in the later years are less
certain and difficult to plan. Both the city’s debt load and annual debt service property tax levy are
evaluated for large projects requiring debt issuance. Current period revenues and one-time use of
reserves provide pay-as-you-go financing for smaller projects.
LONG-TERM FINANCIAL
PLANNING
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Net Position
In the government-wide and proprietary fund financial statements, net position represents the difference between
assets and deferred outflows of resources, and liabilities and deferred inflows of resources. Net position is
displayed in three components:
•Net investment in capital assets – Consists of capital assets, net of accumulated depreciation, reduced
by any outstanding debt attributable to acquire capital assets.
•Restricted net position – Consists of net position restricted when there are limitations imposed on their
use through external restrictions imposed by creditors, grantors, or laws or regulations of other
governments.
•Unrestricted net position – All other net position that does not meet the definition of “restricted” or “net
investment in capital assets.”
The chart to the left shows the net
position balances broken down by
component for the Governmental
Activities. Two-thirds of the
$10,569,693 restricted net position is
related to debt service. Net position
restricted to tax increment districts or
to business loan programs comprise
nearly all the remainder.
The chart to the right shows the net position
balances broken down by component for
business-type activities. The large increase
in 2014 is attributable to the settlement with
Fiber Optics bondholders. The city realized
nearly a $21 million gain on extinguishment
of this debt. The city issued $6,080,000 in
general obligation bonds as part of the
settlement. A $5.5 million land contribution
to Wright County for Bertram Chain of
Lakes Park contributed to the dip in 2015.
The chart to the left displays the total net
position balances arranged by activities:
governmental and business-type. The
business-type activities are separated by
fund (water, sewage, liquor, fiber optics, and
deputy registrar). The chart excludes the
$53,920 net position of the internal service
funds related to business-type activities.
This amount is miniscule, less than .1% of
the city’s $122,538,258 total net position.
The Deputy Registrar (DMV) and Liquor
funds have small assets bases, but together
they generated over $900,000 in cash flow
from operations.
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Fund Accounting
The city accounts for services and projects in different categories of funds.
Governmental Funds
General Fund
This is the primary fund for the city. It accounts for revenues and expenditures associated with the general
operations of the city that are not required to be accounted for in separate funds and includes items such as
parks and public works. Additional information can be found on page five of this report.
Special Revenue Funds
These funds account for the proceeds of specific revenue sources that are restricted or committed for
specific purposes. The city's two largest special revenue funds are the Monticello Community Center (MCC)
Fund and the Economic Development Authority Fund. See page six for more information.
Capital Project Funds
These funds account for the financial resources used for the construction and/or acquisition of capital assets
(i.e., land, buildings, streets, parks, etc.).
Debt Service Funds
These funds account for the financial resources used for the repayment of debt associated with the
construction and/or acquisition of capital assets.
Proprietary Funds
Enterprise Funds
The city currently has five enterprise funds: Water Fund, Sewage Fund, Liquor Fund, Deputy Registrar
(DMV) Fund, and Fiber Optics Fund. These funds are operated and accounted for much like a business.
Pages eight through ten provide additional information on these funds.
Internal Service Funds
These funds are used to account for the financing of centralized services to city departments on a cost-
reimbursement basis. Operating revenues in these funds are expenditures in governmental funds or
expenses in enterprise funds.
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General Fund
The chart below shows General Fund revenues and expenditures for the last five years. After a dip in 2013,
revenues increased in 2014, 2015, and 2016 due to increases in the tax levy and building permit activity.
Expenditures rose with additional public safety, public works, and recreation & culture spending in 2016.
Fund balance is determined as follows:
(Assets + Deferred Outflows of Resources) - (Liabilities + Deferred Inflows of Resources) = Fund Balance
Certain portions of the fund balance are
non-spendable, restricted, committed,
or assigned. Unassigned fund balance
is the remaining portion. The city's
policy is to maintain a year-end
unassigned fund balance of 45% of the
following year's budgeted expenditures.
This is the amount needed to pay
expenditures until the city receives its
first property tax settlement in June.
The year-end unassigned fund balance
is $6,142,475 at the end of 2016.
The chart to the right shows 2016 revenues
by category, excluding other financing
sources. Property taxes continue to be the
primary revenue source. In 2016, property
taxes were 78% of actual revenues, while
budgeted property taxes were 81% of
budgeted revenues. Why? Other revenue
sources are more conservatively estimated.
Excluding other sources, total 2016
revenues were $8,271,566, compared to a
budgeted $7,596,000. Building permit
revenue exceeded the $280,000 estimate by
$318,983 in 2016. Intergovernmental
revenue, charges for services, and
insurance dividends (Other) also contributed
to the positive revenue variance.
In the chart to the left, General Fund
expenditures are distributed by
function. The 2016 total expenditures
were $6,992,812-- $603,188 less than
the budgeted $7,596,000. The
variance is mainly due to position
vacancies, low fuel costs, and a mild
winter, as well as vigilant budget
management. The leadership of the
Public Works Department posted a
positive $443,118 variance --
expenditures less than budget.
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Monticello Community Center (MCC) Fund
The chart below shows revenues, expenditures and transfers, and fund balance for the Monticello
Community Center for the last five years. Revenues were $1,786,832 in 2016, nearly 36% less than 2015.
Expenditures and transfers decreased to $1,654,445, a nearly 37% reduction from 2015. The decrease in
revenues and expenditures is due to the 2015 final payment on the 2008A refunding bonds. The assigned
fund balance increased to $761,829 at the end of 2016. Since the city does not receive its first tax
settlement until June, a portion of the assigned fund balance is used for cash flow purposes. The
remaining fund balance will finance future facility improvements (roof replacement, etc.)
Economic Development Authority (EDA) Fund
The EDA Fund is a special revenue fund with three core areas: general operations, commercial loans, and
tax increment financing (TIF) district management. General operations are the broad EDA activities not
restricted to the other two core areas. TIF districts generate tax increments, which are used for the specific
purposes of each district. There are some exceptions depending on the district type and when the district
was created. The chart below shows revenues, expenditures and transfers, and fund balance for the EDA
for the last five years. The EDA levied a property tax ($280,000) for the first time in 2016. The levy plus the
sale of two parcels of land caused an increase in revenues of $505,313, or 64%, from 2015. A lower
markdown in land held for resale decreased expenditures by $649,700 contributing to the overall
expenditure decrease of $706,361, or 57%. The 2016 increase in fund balance was $579,465.
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All Governmental Fund Revenues and Expenditures
The chart to the left displays
total governmental revenues and
expenditures for the past five
years. In years 2012 through
2014, reserves were used to
retire debt and finance capital
asset acquisitions. In 2105,
revenues grew due to increases
in intergovernmental revenues,
property taxes, and licenses and
permits. 2016 shows a big
increase in expenditures due to
the Core Street project.
Debt Management
The city issues debt periodically to pay for capital projects, such as street and utility construction projects.
Additionally, the city issued debt (2014) to settle with telecommunication bondholders, purchase capital
equipment and refund prior bond issues.
In 2016, Moody’s affirmed the city's A2 bond rating when the city issued $4,900,000 in
bonds for 2016 and 2017 street projects. An A2 is an upper medium grade. A high
bond rating is important because it results in lower interest costs when issuing debt.
The city plans to issue future debt to take advantage of low interest rates.
The amount of debt outstanding at year-end 2016 was $25,068,850, compared to the 2015 year-end
amount of $25,123,268. The chart below provides a glimpse of the current debt load, excluding the
Minnesota Public Facilities Authority note payable for wastewater treatment plant improvements.
The city plans to issue approximately $5,000,000 in General Obligation (G.O.) bonds in 2017 to finance
street improvement projects and the Fallon Avenue overpass.
A2
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Enterprise Funds
Summary of 2016 Actual Results
Water Fund
Water revenues are highly dependent on irrigation during dry years. Although the city has some of the lowest
water rates in the region, recent rate increases may be curtailing some consumption. Transfers to debt service
funds decreased nearly 75% in 2016 due to the payoff of the utility refunding portion of the 2011A Refunding
bonds. Capital contributions in 2014, 2015, and 2016 were primarily impact fees.
Actual Actual Actual Actual Actual
Water Utility 2012 2013 2014 2015 2016
Charges for Services/Sales 1,334,445$1,239,083$1,117,226$1,126,718$1,172,258$
OperatingExpenses 591,766 489,862 571,296 591,416 669,789
Deprectiation 527,023 520,014 514,710 513,814 502,447
OperatingIncome/Loss 215,656 229,207 31,220 21,488 22
NonoperatingRevenues (Expenses)166,123 (58,209)199,910 58,572 73,177
Capital Contributions 499,158 -81,291 268,329 187,854
Transfers In/(Out)(207,219)(413,500)(631,560)(790,958)(199,327)
Change inNet Position 673,718$(242,502)$(319,139)$(442,569)$61,726$
Water Sewage Liquor FiberOptics DMV
Fund Fund Fund Fund Fund
Charges forServices/Sales 1,172,258$2,223,252$5,450,630$1,739,566$562,891$
OperatingExpenses 669,789 1,411,831 4,836,760 2,071,365 348,932
Deprectiation 502,447 1,142,479 40,512 419,555 3,185
OperatingIncome/Loss 22 (331,058)573,358 (751,354)210,774
Nonoperating Revenues (Expenses)73,177 (35,828)12,663 5,783 9,273
Capital Contributions 187,854 1,812,602 ---
TransfersIn/(Out)(199,327)(770,134)(350,000)350,000 -
Change in NetPosition 61,726$675,582$236,021$(395,571)$220,047$
Cash and Investments atYear-End 4,035,865$2,596,530$1,037,180$303,008$817,006$
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Sewage Fund
Sewage revenues are minimally impacted by dry or wet years because of winter averaging for residential
customers. Winter averaging utilizes winter month water consumption to calculate summer sewage bills. The
city has raised sewage rates consistently over time to minimize the annual operating loss. But residents and
businesses still enjoy some of the lowest sewage rates in the region. Similar to the Water Fund, transfers to
the Debt Service Fund offset declines in impact fees collected from developers. In 2015 and 2016, capital
contributions included a capital grant for wastewater treatment plant improvements and impact fees paid by
developers. In 2014, impact fees are the sole component of capital contributions.
Actual Actual Actual Actual Actual
Sewage Utility 2012 2013 2014 2015 2016
Charges for Services/Sales 1,875,351$2,006,718$2,081,660$2,083,122$2,223,252$
OperatingExpenses 1,352,952 1,276,416 1,570,197 1,479,157 1,411,831
Deprectiation 1,105,980 1,107,508 1,106,532 1,103,397 1,142,479
OperatingIncome/Loss (583,581)(377,206)(595,069)(499,432)(331,058)
NonoperatingRevenues (Expenses)90,064 (130,806)75,256 37,755 (35,828)
Capital Contributions 1,178,550 -407,337 1,186,651 1,812,602
Transfers In/(Out)--(1,690,672)(1,510,087)(770,134)
Change inNet Position 685,033$(508,012)$(1,803,148)$(785,113)$675,582$
Sewage Gallons Treated (millions)408 392 435 417 432
Liquor Fund
The city’s municipal liquor store, Hi-Way Liquors, posted a small decline in sales in 2016, mostly due to a
street construction project hindering access to the store. Operating expenses included a $34,300 non-cash
charge for recognizing a higher state pension plan obligation for covered employees. Monticello’s liquor store
consistently scores in the top 5 state-wide for municipal sales in cities with one store. The store also sponsors
two well-attended wine tasting events each year at the Monticello Community Center.
In the schedule below, cost-of-goods sold is included in operating expenses. The decline in transfers to the
Fiber Optics Fund, $350,000 in 2016, reflects increased stability in the city’s telecommunications operations.
All transfers from this fund were to the Fiber Optic Fund.
Actual Actual Actual Actual Actual
Liquor Store 2012 2013 2014 2015 2016
Charges for Services/Sales 4,854,798$5,086,611$5,166,066$5,493,925$5,450,630$
OperatingExpenses 4,250,615 4,410,456 4,524,342 4,724,209 4,836,760
Deprectiation 51,440 47,141 46,922 46,923 40,512
OperatingIncome/Loss 552,743 629,014 594,802 722,793 573,358
NonoperatingRevenues (Expenses)(9,333)(8,283)13,381 3,015 12,663
Transfers In/(Out)(3,500,000)(650,000)(600,000)(450,000)(350,000)
Change inNet Position (2,956,590)$(29,269)$8,183$275,808$236,021$
Annual Sales GrowthPercentage 4.1%4.1%2.4%6.3%-0.7%
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Deputy Registrar (DMV) Fund
The Deputy Registrar (DMV) Fund enjoyed its best year ever. Both transactions and revenues reached
significant milestones in 2016. The well-trained and pleasant staff of the DMV processed 75,891 transactions
in 2016, topping its prior year previous record of 72,522. In addition, DMV revenues exceeded $550,000 for
the first time. DMV provides the following services: Department of Natural Resources licenses, game and fish
licenses, change of address and replacement driver’s licenses, motor vehicle title processing and licenses.
Growth in market share and operating income per transaction demonstrate the DMV’s commitment to
providing excellent customer service.
Actual Actual Actual Actual Actual
Deputy Registrar (DMV)2012 2013 2014 2015 2016
Charges for Services/Sales 455,293$456,384$497,798$535,931$562,891$
OperatingExpenses 282,258 289,296 299,524 315,501 348,932
Deprectiation -4,842 3,185 3,185 3,185
OperatingIncome 173,035 162,246 195,089 217,245 210,774
NonoperatingRevenues (Expenses)12,105 (2,188)10,736 6,678 9,273
Transfers In/(Out)(325,000)(75,000)(50,000)--
Change inNet Position (139,860)$85,058$155,825$223,923$220,047$
Annual Transactions 62,999 62,384 67,895 72,522 75,891
% of State-Wide Transactions 1.10%1.09%1.13%1.21%1.25%
Operatingincome per transaction $2.75 $2.60 $2.87 $3.00 $2.78
Fiber Optics Fund
Years 2015 and 2016 have been relatively stable years for Fiber Optics Fund operations. Indeed, the
operating budget, which uses modified accrual accounting, required about $332,000. This is less than the
$350,000 subsidy it received from the Liquor Fund in 2016. Depreciation is a non-cash expense. Add
depreciation to the operating loss and you get a rough approximation of the cash required by operations. A
$329,504 reduction in the net pension liability to the state-wide pension fund is recognized as nonoperating
revenue in 2016. The pension liability went away when the city hired an outside firm, Arvig, to run its fiber
optics utility. The fund’s former employees now work for Arvig.
Actual Actual Actual Actual Actual
Fiber Optics 2012 2013 2014 2015 2016
Charges for Services/Sales 1,794,144$1,621,662$1,761,978$1,642,403$1,739,566$
OperatingExpenses 2,964,200 2,893,612 2,368,154 2,010,010 2,071,365
Deprectiation 416,091 410,818 442,930 419,782 419,555
OperatingIncome/Loss (1,586,147)(1,682,768)(1,049,106)(787,389)(751,354)
NonoperatingRevenues (Expenses) (1,853,087)(1,937,546)(96,014)(103,592)362,683
GainonDebt Extinguishment --20,990,451 --
Transfers In/(Out)4,450,000 860,000 6,383,732 450,000 350,000
Change inNet Position 1,010,766$(2,760,314)$26,229,063$(440,981)$(38,671)$
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Tax Levy
The City Council adopts a tax levy for the General Fund, Monticello Community Center Fund and Debt Service
Fund. The levy for taxes payable in 2016 was $9,205,000--$670,000 (7.9%) higher than the 2015 levy of
$8,535,000. However, most residents and businesses experienced a drop in their property taxes in 2016. Why?
Xcel continued to make improvements to its nuclear power generating plant in 2014 as part of a 2013 uprate, or
increase in value. The 2014 improvements reached the tax rolls in 2016. Similarly, an Xcel uprate in 2011 reached
the tax rolls in 2013.
The chart to the left displays the
property tax levy using the left
scale (green bars) and the tax
capacityrate using the rightscale
(red line). The city has increased
the levy the last two years to
compensate for the drop in the
tax capacityrates caused by Xcel
uprates. The tax levy divided by
the tax capacity equals the tax
capacity rate. Tax capacity is a
derivative of the taxable market
value.
The General Fund is primarily supported by property
taxes. Annual General Fund budgets typically plan to get
over 80% its total revenue from the property tax levy. No
other revenue source comprises more than 5% of
General Fund total revenues.
Debt service funds are typically supported by a wide
range of revenue sources (property taxes, special
assessments, developer impact fees, transfers from
other funds, etc.).
The MCC Fund is primarily supported by use fees
(memberships, activity fees, rental charges, etc.)
Additionally, the MCC Fund receives a portion of the tax
levy for operations and for debt service.
Three tax levying authorities
compete for your property tax
dollar: Wright County, City of
Monticello, and Independent
School District #882. As it is,
Monticello property owners pay
more tax dollars to the county
than to city coffers. Indeed,
Monticello’s tax capacity rate is
the lowest in Wright County. A
little more than one-third of your
property tax supports a wide
range of city services, including
residential garbage and recycling
services.
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Largest Taxpayers, Employers, and Customers
As taxpayers go, none is larger in Monticello than Northern States Power Co. (dba Xcel Energy). The company
operates a nuclear power plant located inside Monticello’s western boundary. The company has made two uprate
improvements in the last five years, absorbing a larger share of the city’s property tax levy. Xcel’s share of the levy
has increased from 40% to 61% in the last five years. That’s over a 50% increase to NSP. Consequently, the city
has the lowest tax capacity rate in Wright County.
City of Monticello 2012 2013 2014 2015 2016
Estimated Market Value 312,906,200$495,349,400$464,619,100$722,993,700$795,994,000$
Net Tax Capacity 6,252,112$9,901,516$9,285,841$14,453,109$15,913,229$
Tax Capacity Rate 49.773 42.262 44.709 35.737 34.471
NSPProperty Tax Paid 3,111,864$4,184,579$4,151,607$5,165,108$5,657,471$
Total City Tax Levy 7,850,000$7,900,000$8,150,000$8,535,000$9,205,000$
NSP% of Total City Tax Levy 40%53%51%61%61%
Xcel Energy is the largest employer, too. With 700 employees, Xcel edges out the largest governmental employer,
Independent School District 882. Neither Xcel nor the school district are Monticello’s largest utility customer. Cargill
Kitchen Solutions generates $410,130 or 18% of the sewage utility operating revenue and $78,763 or 7% of the
water utility revenue. Cargill operates a plant that produces further-processed egg products in the breakfast
category for restaurants and food manufacturers.
Employer Employees
Xcel Energy (Northern States)700
ISD No. 882 (Monticello)544
CentraCare Medical Center (New River)500
Cargill Kitchen Solutions (Sunny Fresh)450
Wal-Mart Supercenter 325
Cub Foods 180
Ultra Machine Corporation 173
Home Depot 160
City of Monticello 150
WSI Industries, Inc.100
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Useful Terms
Accrual basis of accounting is the method of accounting that recognizes the financial effect of transactions,
events when they are incurred rather than at the time when cash is received or disbursed.
Assets are resources with present service capacity that the city controls. For example, cash from taxes paid by
citizens is an asset that can be put to use to provide public safety.
Capital assets are tangible or intangible nonfinancial assets that have an initial useful life of
more than one year and are used in providing services for the city and its residents.
Change in net position represents the increase or decrease in net position over the previous year.
Current assets include cash or near cash items that can be used to liquidate liabilities due within a year.
Deferred inflows of resources are an acquisition of net position (inflow of resources during the year) by the
city that is applicable to a future reporting period.
Deferred outflows of resources is a consumption of net position by the city (outflow of resources during the
year) that is applicable to a future reporting period.
Fund is defined as a fiscal and accounting entity with a self-balancing set of accounts, which are segregated for
the purpose of carrying on specific activities or attaining certain objectives in accordance with special
regulations, restrictions, or limitations.
Fund balance denotes the difference between fund assets, deferred outflows of resources, liabilities, and
deferred inflows of resources in governmental funds balance sheets.
Government-wide reporting provides an aggregate view of the city’s financial activities by
consolidating both the governmental and business-type activities using the accrual basis of accounting.
Liabilities are present obligations of the city to sacrifice resources that it has little or no discretion to avoid, such
as, the amounts the city owes to suppliers and creditors.
Long-term liabilities include items such as bonds, loans, compensated absences, pension liabilities and other
city obligations, typically due beyond the current reporting period.
Modified accrual basis of accounting is the method of accounting used in governmental funds
where revenues are not recognized until they are both measurable and available. Expenditures are
recognized in the period when the liability is liquidated rather than incurred.
Net investment in capital assets is the portion of net position that represents the city’s equity
interest in its capital assets (capital assets less the amount of debt used to acquire them).
Net position is the residual of all other financial statement elements in accrual basis statement of net position:
the difference between assets, deferred outflows of resources, liabilities, and deferred inflows of resources.
Restricted net position is the portion of net position subject to external restrictions (e.g. state law, bond
covenants, etc.).
Statement of activities reports both governmental and business-type activities using the accrual basis of
accounting showing total expenses and the extent of funding from program revenues and general revenues.
Unrestricted net position is the portion of net position not tied to capital assets or subject to legal restrictions
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Awards
The Government Finance Officers Association (GFOA), with nearly 17,400 colleagues, is dedicated to
enhancing and promoting the professional management of governments for the public benefit. Since 1906, the
GFOA has been accomplishing this mission by identifying and developing the highest quality financial policies
and practices and promoting them to the public through education, training, and leadership.
The GFOA has established several highly regarded professional recognition programs to encourage and assist
state and local governments of all types and sizes to improve the quality of their financial management and to
recognize their achievement.
Each award is valid for one year. The city of Monticello has received the following awards:
Popular Annual Financial
Report: 2015
Distinguished Budget Presentation
Award: Years 2013 – 2016
Certificate of Achievement for
Excellence in Financial Reporting –
Comprehensive Annual Financial
Report (CAFR): Years 2012 – 2015