2021 Budget2021 Adopted Budget
City of Monticello, Minnesota
505 Walnut Street . ci.monƟcello.mn.us . 763‐295‐2711
Table of Contents
Introduction and Overview
Directory of Public Officials ........................................................................................................... 1
Distinguished Budget Presentation Award .................................................................................... 2
Strategic Goals & Strategies .......................................................................................................... 3
Priorities & Issues ........................................................................................................................ 13
Budget Overview ......................................................................................................................... 15
Financial Structure, Policy & Process
Organization Chart ....................................................................................................................... 28
Fund Descriptions & Structure .................................................................................................... 29
Departments & Funds Relationship ............................................................................................. 32
Basis of Budgeting ........................................................................................................................ 33
Financial Policies .......................................................................................................................... 34
Budget Development & Administration ................................................................................ 34
Revenue Collection ................................................................................................................ 35
Expenditures and Payments .................................................................................................. 36
Debt Administration .............................................................................................................. 37
Reserves and Fund Balances ................................................................................................. 38
Financial Reporting & Accounting ......................................................................................... 39
Cash Management & Investment .......................................................................................... 40
The Budget Process...................................................................................................................... 49
Financial Summaries
Consolidated Financial Schedules
All Funds Summary By Fund Type ......................................................................................... 52
Revenues By Category and Fund-Type ................................................................................. 53
Appropriations By Category and Fund-Type ......................................................................... 55
Interfund Transfers ................................................................................................................ 57
Three Year Consolidated and Fund Financial Schedules
All Funds Summary By Year ................................................................................................... 58
Fund Balance/Working Capital .................................................................................................... 60
Changes in Fund Balance/Working Capital ........................................................................... 61
Fund Balance/Working Capital History ................................................................................. 62
Revenue Sources By Fund
Revenue Trends & Analysis ................................................................................................... 63
Tax Levy History ..................................................................................................................... 72
Tax Capacity History .............................................................................................................. 73
Largest Property Taxpayer .................................................................................................... 74
Revenues Sources By Fund .................................................................................................... 76
Long Range Financial Plans .......................................................................................................... 78
Long-Term Fiscal Objectives .................................................................................................. 83
Staffing Summary......................................................................................................................... 86
Capital & Debt
Capital Expenditures & Capital Improvement Program .............................................................. 87
Funding Source Summary ...................................................................................................... 94
Projects & Funding Sources By Department ......................................................................... 95
Debt ........................................................................................................................................... 100
Departmental Information
General Fund – Summary .......................................................................................................... 103
General Government
Mayor and City Council .................................................................................................... 106
City Administration ........................................................................................................... 107
City Clerk ........................................................................................................................... 109
Finance ............................................................................................................................. 111
Audit ................................................................................................................................. 113
Assessing .......................................................................................................................... 114
Legal.................................................................................................................................. 115
Human Resources ............................................................................................................. 116
Planning, Zoning & Community Development ................................................................. 118
City Hall ............................................................................................................................. 121
Prairie Center Building ..................................................................................................... 122
Public Safety
Law Enforcement ............................................................................................................. 123
Fire & Rescue .................................................................................................................... 125
Fire Relief .......................................................................................................................... 127
Building Inspections ......................................................................................................... 128
Emergency Management ................................................................................................. 130
Animal Control .................................................................................................................. 131
National Guard ................................................................................................................. 133
Public Works
Public Works Administration ............................................................................................ 134
Engineering ....................................................................................................................... 136
Inspections ....................................................................................................................... 138
Streets, Alleys & Parking Lots ........................................................................................... 140
Ice & Snow Removal ......................................................................................................... 142
Shop & Garage .................................................................................................................. 143
Stormwater ....................................................................................................................... 145
Street Lighting .................................................................................................................. 146
Refuse Collection .............................................................................................................. 147
Recreation and Culture
Senior Center .................................................................................................................... 148
Transit ............................................................................................................................... 150
Park Operations ................................................................................................................ 151
Park Ballfields ................................................................................................................... 153
Public Arts ......................................................................................................................... 154
Library ............................................................................................................................... 155
Shade Tree ........................................................................................................................ 157
Other - Insurance ................................................................................................................. 159
Special Revenue Funds – Summary ........................................................................................... 161
Economic Development Authority Fund ............................................................................. 162
Cemetery Fund .................................................................................................................... 164
Small Cities Development Program (SCDP) Fund ................................................................ 166
Community Center Fund ..................................................................................................... 167
Debt Service Funds – Summary ................................................................................................. 169
2011A G.O. Refunding Bond Sub-Fund ............................................................................... 170
2014A G.O. Judgment Bond Sub-Fund ................................................................................ 172
2015B G.O. Bond Sub-Fund ................................................................................................. 174
2016A G.O. Bond Sub-Fund ................................................................................................. 176
2017A G.O. Bond Sub-Fund ................................................................................................. 178
2018A G.O. Bond Sub-Fund ................................................................................................. 180
2019A G.O. Bond Sub-Fund ................................................................................................. 182
2020A G.O. Bond Sub-Fund ................................................................................................. 184
Closed Debt Service Funds .................................................................................................. 186
Capital Project Funds – Summary .............................................................................................. 187
Capital Project Fund ............................................................................................................ 188
Closed Bond Fund ................................................................................................................ 190
Park & Pathway Dedication Fund ........................................................................................ 192
Stormwater Access Fund ..................................................................................................... 194
Street Lighting Improvement Fund ..................................................................................... 195
Street Reconstruction Fund ................................................................................................. 197
Enterprise Funds – Summary ..................................................................................................... 199
Water Fund .......................................................................................................................... 200
Sewage Fund........................................................................................................................ 202
Stormwater Fund ................................................................................................................. 206
Liquor Fund .......................................................................................................................... 208
Deputy Registrar Fund ......................................................................................................... 210
Fiber Optics Fund ................................................................................................................. 212
Internal Service Funds – Summary ............................................................................................ 215
Facilities Maintenance Fund ................................................................................................ 216
IT Services Fund ................................................................................................................... 218
Central Equipment Fund...................................................................................................... 220
Benefit Accrual Fund ........................................................................................................... 222
Community, Demographic, and Statistical Information ............................................................ 225
Appendix
Property Tax Basics .................................................................................................................... 228
Truth-in-Taxation ....................................................................................................................... 230
Debt Guide ................................................................................................................................. 231
Minnesota Statutes.................................................................................................................... 240
Utility Rates ................................................................................................................................ 244
Capitalization Thresholds........................................................................................................... 245
Tax Capacity, Tax Levy, & Tax Rate History ............................................................................... 246
Glossary ..................................................................................................................................... 247
DIRECTORY OF PUBLIC OFFICIALS
MAYOR & CITY COUNCIL
Position Name Term Expires
Mayor .............................................................................. Brian Stumpf 12/31/2020
Council .............................................................................. Lloyd Hilgart 12/31/2022
Council ........................................................................Charlotte Gabler 12/31/2022
Council ....................................................................................... Bill Fair 12/31/2020
Council ............................................................................. Jim Davidson 12/31/2020
CITY STAFF
City Administrator ........................................................Rachel Leonard
Public Works Director/City Engineer ............................. Matt Leonard
Finance Director .................................................... Sarah Rathlisberger
Community Development Director ........................ Angela Schumann
Community Center Director ...................................................... Vacant
City Clerk ................................................................. Jennifer Schreiber
Human Resource Manager ................................................Tracy Ergen
Communications Coordinator ......................................Rachel Leonard
Street Superintendent ................................................... Mike Haaland
Parks Superintendent ....................................................... Tom Pawelk
Water & Sewage Superintendent ........................................ Mat Stang
Senior Accountant ............................................................... Liz Lindrud
Deputy Registrar Manager ......................................... Carolyn Granger
Liquor Store Manager ................................................ Randall Johnsen
Economic Development Manager ...................................... Jim Thares
Chief Building Official ............................................ Ron Hackenmueller
Fire Chief .................................................................... Michael Mossey
JOINT CITY/COUNTY/OUTSIDE STAFFING
Wright County Sheriff .................................................... Sean Deringer
NAC Planning Consultant ............................................. Steve Grittman
Northland Securities Financial Advisor ......................... Tammy Omdal
Veolia Environmental Services ............................................ Larry Cook
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, 2020. The city has received this award for each budget it has
prepared for the past twelve years.
In order 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.
GOVERNMENT FINANCE OFFICERS ASSOCIATION
D istinguished
B udget Presentation
Award
PRESENTED TO
City of Monticello
Minnesota
For the Fiscal Year Beginning
January 1, 2020
Executive Director
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STRATEGIC GOALS & STRATEGIES
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The city will update the Strategic Goals & Objectives will be updated by the same process in
2021 to reflect influences of a new Council.
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The city plans for the long-term needs of the community through several efforts and studies.
These documents are usually developed by consultants and staff, with numerous public
hearings and advisory board meetings prior to their formal adoption by the City Council. Once
adopted, city staff works diligently to implement the recommendations and changes outlined in
the plans.
Plans for service provision, facility expansion & maintenance:
1. Monti:2040 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. Various chapters of
the Comprehensive Plan have been amended in part or full since adoption. A full update to the
Comprehensive Plan, the Monti:2040 Vision and Comprehensive Plan, began with the visioning
phase in 2019 and concluded in 2020 with the plan formation based on the visioning. The
Monti:2040 Comprehensive Plan was adopted by the City Council on November 23rd, 2020.
2. Transportation Plan – Replaced by Monti:2040 Comprehensive Plan.
The city’s Transportation Plan, now Chapter 4 of the Monti:2040 Comprehensive Plan, 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
Ave, Fallon Ave. and Edmonson Ave, among others.
3. Parks & Pathways Plan – Adopted 2011.
Chapter 5 – Parks of the Monticello Comprehensive Plan was amended in 2011 for the adoption
of an updated Park and Pathway Plan. The Monticello Parks and Pathways Plan identifies the
city’s objectives for Parks and Pathways planning and development and building on 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
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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 Monticello2040 Plan to update
the detailed portion of this plan.
4. 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 will be asked to consider several
implementation strategies to realize plan goals. The Downtown Small Area Plan is incorporated
in the Monti:2040 Vision & Comprehensive Plan.
5. Economic Development Strategic Plan - Updated 2018.
In 2016, the city adopted a Housing and Redevelopment Authority property tax levy of
$280,000. The HRA levy increases to $366,300 for 2021. The levy is used for EDA redevelopment
activities. The EDA has adopted a strategic work plan for 2021, which requires ratification by the
City Council.
6. Natural Resource Inventory & Assessment - Adopted 2008.
The purpose of the Natural Resource Inventory and Assessment (NRI/A), adopted in 2008, is to
identify existing natural resources within the City of Monticello and its growth area (the
Monticello Orderly Annexation Area), inventory these resources, and assess the resource quality.
These resources are then considered and evaluated during growth/development.
7. Bertram Chain of Lakes Recreation Plan – Adopted 2016.
The Monti: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. Land acquisition is complete and major improvements
took place in 2019 and 2020.
8. 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.
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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 in 2014 related to grading,
drainage, erosion control, and storm water management to meet current MPCA requirements
per the city’s new MS4 permit issued on January 16, 2014. The permit expired July 31, 2018. The
city has paid for a new permit, but MPCA will reissue the new permit requirements sometime in
2021 for the permit to be officially updated.
9.Comprehensive Water Resource Management Plan - Updated 2006.
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
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. It is anticipated to update the hydraulic model and plan to conform with new
stormwater ponding design requirements because of the new NOAAA Atlas 14 standard
released by the National Weather Service Hydrometeorological Design Studies for rainfall
frequency estimates.
10.Plan Requirements and Design Guidelines (“Design Manual”) - Updated 2017.
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 that were
adopted in 2014 related to grading, drainage, erosion control, and storm water management.
The Design Manual will be updated as needed for new design regulations and requirements.
11.General Specifications and Standard Detail Plates for Street and Utility Construction -
Updated 2017.
These specifications represent the city’s requirements for construction of public street and utility
systems.
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12. Water System Plan – Adopted 2004.
A water distribution system model was created in 2004 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. A study to update this plan is budgeted in 2021.
13. Sanitary Sewer Comprehensive Plan – Adopted 1995.
The sanitary sewer comprehensive plan was adopted in 1995. It identified 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. A study to
update this plan is budgeted in 2021.
14. Interchange Planning Study – Pending.
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. A land use analysis
component related to this study was completed in 2016.
15. 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.
16. Central Mississippi River Regional Planning Partnership (CMRP) – Ongoing.
A series of meetings have taken place with representatives invited from the City of Big Lake, Big
Lake Township, City of Becker, Becker Township, Monticello Township, Silver Creek Township,
Wright County, Sherburne County, and the City of Monticello to discuss regional planning and
economic development. A joint power agreement was adopted by the city in December 2015.
The TH 25 area transportation study was completed in 2018 and identified options for near-
term and long- term improvements to the corridor.
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Plans for Facility and Infrastructure Maintenance:
1. Wastewater Treatment Facility Biosolids Dewatering, Energy Efficiency, Headworks and Site
Improvements Feasibility Report – Adopted 2012.
Dewatering facility was completed at year-end 2014. The energy-efficient aeration blowers and
piping were completed in 2016. These projects were financed by the Sewage Fund.
Future improvements identified in the Capital Improvement Plan include SCADA system
upgrades, Phase 2 facility and site improvements, solids handling improvements and headworks
improvements.
2. Wastewater Treatment Phosphorus Reduction Facility Plan – Adopted 2014.
Construction of the project was completed in 2017. The facility plan was amended to include
replacement of two digester covers. The project final cost was $3.3 million, financed by a $2.2
million loan and $1.1 million grant, both from the Minnesota Public Facilities Authority.
3. Overall Street Reconstruction Program – Adopted 2004, ongoing as part of capital
improvement plan.
The 2021-2025 Capital Improvement Plan includes projects related to the program, with various
projects located through the city planned. No street reconstruction plans are budgeted in 2021,
but the CIP includes one for 2022.
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 as well as at the J-turn located approximately a quarter of a mile down
the road.
Fenning Avenue (CR 118) Corridor Improvements – Wright County in cooperation with the City
of Monticello is developing construction plans to reconstruct County Road 118 (Fenning Avenue)
from Highway 37 to north of School Boulevard. The corridor is being reconstructed to improve
safety, mobility of all users and improve the existing infrastructure condition.
Financial Plans:
1. Annual Budget - Adopted each December.
2. Capital Improvement Plan - Updated and adopted each year; most recently for 2021 -2025.
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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.
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PHASE ONE | JANUARY 2020
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
TO LEARN MORE!
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Medium and Small Lot Conservation Developments4-10 Units/Acre4-10 Units/Acre
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PRIORITIES AND ISSUES
The city’s priorities were redefined in the Monti:2040 Comprehensive Plan completed during 2019 and
2020 and adopted by the City Council on November 23, 2020. This Comprehensive Plan highlights the
city’s desire to grow within before expanding out by focusing on three key themes: Sustainability,
Community Health and Sense of Place. With how recently the Comprehensive Plan was adopted, it was
not fully incorporated in the 2021 budget, but will be the primary influence in financial planning going
forward.
Monticello, like all other levels of government, is learning how to operate in the unprecedented time of
the COVID-19 pandemic. The basic services a government offers cannot be eliminated or postponed, so
operations shifted greatly and unexpectedly in 2020. The 2021 budget reflects a response to the pandemic
while considering how far we have come in learning about and responding to the spread of the virus. The
unpredictable effects of the pandemic are hard to forecast, but revenues are budgeted conservatively, and
expenditures are estimated liberally to ensure sound financial position. The city’s reliance on property
taxes over sales or lodging taxes was beneficial in avoiding large financial turmoil in 2020, but the ripple
effects on property taxes remain to be seen.
Notable changes in service levels and fees include:
Staffing:
• Engineering: The Inspection Engineer was promoted to Project Engineer and a new Inspection
Technician position is created. While engineering work will be outsourced when necessary, this
shift brings engineering services more internal to recognize cost savings. Budget effect: $102,000
wages & benefits; ($153,000) contracted services savings and fees collected.
• Facilities Maintenance: The city is creating a new Facilities Maintenance internal service fund in
2021 and shifting staff from the Monticello Community Center to a centralized department that
will oversee repairs and maintenance for all city-owned buildings. Budget effect: $292,000 costs in
new internal service fund; ($230,000) reduction of costs in Community Center Fund.
• Information Technology (IT) Services: A new IT Technician is budgeted for 2021 with a mid-year
start date and an anticipated job-share with a local municipality. The CARES Act grant in 2020
allowed for funding of long overdue upgrades to the city’s IT system. In the past, a contracted
proprietor handled the IT function with various staff assisting in different areas. The new position
will allow the city to centralize the IT function to an individual with formal training and expertise to
handle all aspects besides server monitoring that is done by a third-party company. Budget effect:
$42,000 wages & benefits; ($21,000) cost share revenue with local municipality.
Arts Initiative: The Arts Initiative was created in 2018 to assist with the revitalization of the downtown
area. The 2021 budget includes an increase in support to further grow the program. Budget effect:
$20,000 contracted services.
Solar Farm Investment: The city invests in a solar farm whereby the city pays the owner per kilowatt-hour
(kWh) of energy production. In return, the city receives solar rebates on its electric bills. The cost is a fixed
13
$0.119 per kWh produces and the rebate fluctuates based on the market rate of electric consumption,
typically around $0.125 per kWh creating a net return to the city. The solar farm came online in late 2019
and was not reflected in the 2020 budget. 2021 budget effect: $420,000 investment expenditure;
($432,000) electricity cost rebate.
Utility fees:
•Water & sewage: Water and sewage fees increase 10% for base charges and 5% for usage
charges in anticipation of large upcoming capital improvements.
•Stormwater: Stormwater fees double in 2021, from $1.50/drainage unit to $3.00/drainage unit to
fund significant capital costs coming up in the next couple years.
•Garbage & recycling: Garbage and recycling fees increase in 2021. Prior to the implementation of
fees in 2018, residential garbage and recycling services were wholly subsidized by the tax levy. In
2021, fees will cover the cost of residential garbage 100% and recycling costs will be covered 50%
by user fees. The city plans to have all garbage and recycling fees paid for by users in 2023.
14
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 and activists, 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. Indeed, 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. The importance of a sound revenue picture cannot be overstated.
Revenue estimates are based on historical trends with greater weight placed on the most
current years.
The City of Monticello provides a range of services to the community, including police
(contracted) and fire protection, street and park maintenance, snow and ice removal, water,
and sewer utility services, and administrative and planning services. In addition, the city owns
and operates a community center (MCC), department of motor vehicles (DMV), municipal off-
sale liquor store (Hi-Way Liquors), and a fiber optic network (FiberNet Monticello). The level of
service provided by the proposed budget is as currently enjoyed by the community.
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 blessed with 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 do business. The city will fulfill the goals below to achieve this mission:
1.Continue to maintain the lowest possible tax rate while providing the best possible service.
The 2021 property tax levy exceeded inflation and the tax levy (capacity) rate increased over
2020. 2021 Budget: The city levy increases $618,700 (5.9%) to $11,063,700 and the Housing and
Redevelopment (HRA) levy increases $11,300 (3.2%) to $366,300. Combined (city + HRA) tax levy
increase: $630,000 (5.8%). The tax levy rate is the second lowest of cities in Wright County.
15
2.Continue to develop and provide 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.
In partnership with the county, the city acquired park land, which is roughly 50% for land
designated for non-athletic purposes and 50% for land designated for athletic purposes. The city
also maintains 365 acres of park land and 42.0 miles of trails. 2021 Budget: $400,000 CSAH 39
pathway, $300,000 Fenning Avenue trail, $275,000 Ellison Park restroom building.
3.Continue to maintain the city streets by following an annual seal coat and crack seal
program and by overlaying streets before they are beyond repair and need replacing.
The city’s pavement management program identifies varying condition levels of every street.
The 2021 General Fund includes a robust amount for chip/seal maintenance. This higher
maintenance level began in 2014. 2021 Budget: $320,000.
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. 2021 Budget: $15,000 - membership
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. The city transferred $300,000 from the General Fund to the Capital Project
Fund in 2017 to start implementing the plan. 2021 Budget: None.
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. 2021 Budget: None.
7.Seek to develop and attract a wide range of employment opportunities with a growing
emphasis on higher-paying jobs.
16
This concept promotes the city’s competitive advantages (i.e., low taxes, property availability,
transportation access, etc.) to businesses looking to move or grow. 2020 Budget for non-study
redevelopment activity: $123,000
8.Continue to maintain high quality water and sewage treatment facilities.
With some of the lowest water and sewage rates in Minnesota, the city provides excellent
services from these two utilities to residents and businesses. The budget includes funds for
wastewater treatment facility improvements along with enough for additional, ongoing system
improvements in each fund. Our water is rated as one of the best tasting in Minnesota. 2021
Budget: Water - $150,000 annual improvements, $700,000 SCADA system update; Sewage -
$250,000 annual improvements, $125,000 wastewater facility repair and maintenance, and
$930,000 SCADA system update.
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. 2020 Budget: $333,000 system expansion to
new neighborhood developments.
City Council and city staff used the goals set during the strategic planning process to direct the
development of the 2021 budget.
TOTAL BUDGET
The 2021 budget includes all the funds maintained by the city. Each fund is responsible to
account for a particular activity or activities. Each fund-type will be discussed within this
message and/or in the budget document.
The following compares the adopted 2020 and 2021 budgets:
Fund Type 2020 2021 2020 2021
General 8,903,000$ 9,875,000$ 8,903,000$ 9,875,000$
Special Revenue 3,122,000 2,460,000 2,945,000 2,087,000
Debt Service 3,373,291 3,270,000 4,148,774 3,325,000
Capital Project 4,112,013 4,190,000 3,550,000 4,294,000
Enterprise 13,314,299 14,419,000 14,729,826 15,605,000
Internal Service 579,397 1,559,000 861,400 1,545,000
Total 33,404,000$ 35,773,000$ 35,138,000$ 36,731,000$
Total Budget
Revenues Expenditures
17
Total revenues increase 7% and total expenditures decrease about 4.5% in 2021. General Fund
revenues and expenditures increase 10.9%, about half of which is due to a new solar
investment and rebate program. The decrease in debt service expenditures reflects the partial
early redemption of one issue in 2020. Capital project funds will incur higher expenditures due
to the anticipated acquisition of a site for a new public works facility. The water and sewage
funds have budgeted $700,000 and $930,000, respectively, for a SCADA system upgrade. The
Stormwater enterprise fund has $700,000 budgeted for infrastructure improvements.
The following graphs display the revenues and expenditures attributable to each fund-type in
the 2021 Budget:
General
28%
Special
Revenue
7%
Debt
Service
9%
Capital
Project
12%
Enterprise
40%
Internal
Service
4%
2021 Revenues by Fund Type
General
27%
Special
Revenue
6%
Debt
Service
9%
Capital
Project
12%
Enterprise
42%
Internal
Service
4%
2021 Expenditures by Fund Type
18
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
73% of revenues in the General Fund and 35% in the special revenue funds. In 2021, debt
services funds will receive $2,831,479 in property taxes for principal and interest payments on
general obligation debt, which is 32% higher than the prior year’s $2,939,987. The city levied
$578,221, up from prior year $300,013, for the Capital Projects Fund in 2021. For 2021, the
city's general (operations and debt) property tax levy will increase to $11,063,700, an increase
of $618,700 (5.9%) over the prior year. For the sixth consecutive year, the city imposed a
Housing and Redevelopment Authority (HRA) special benefit levy. The HRA levy increases to
$366,300 (+3.2%) from $355,000 in the prior year. The special benefit levy is receipted in the
Economic Development Authority Fund. When added together, the two levies represent a 5.8%
increase in property taxes.
The following table is a historical view of the tax capacity value, tax capacity rate and tax levy:
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 2021 at $31,008,092, a 3.8% increase. The Xcel Energy nuclear power plant taxable
market valued rose 3.3% in 2021 to $806 million. The value of the plant is still 2.7 times greater
than its 2012 value of $298 million. The Xcel plant alone accounts for over ½ of the city’s tax
capacity. The city's property tax levy is divided by the tax capacity to determine the city's tax
capacity rate, which is then applied to each property's tax capacity to determine the city’s tax.
For 2021, the city's tax capacity rate is expected to increase to 36.861%, a 2.0% increase.
The city, currently, does not have the authority to levy or collect local sales taxes or other types
of taxes under the state's tax system.
Tax Capacity City Tax HRA Tax Total Tax Tax Capacity
Year Value Levy Levy Levy Rate
2012 15,771,688$ 7,850,000$ -$ 7,850,000$ 49.773
2013 18,692,762$ 7,900,000$ -$ 7,900,000$ 42.262
2014 18,289,491$ 8,150,000$ -$ 8,150,000$ 44.561
2015 23,882,689$ 8,535,000$ -$ 8,535,000$ 35.737
2016 25,891,898$ 8,925,000$ 280,000$ 9,205,000$ 35.552
2017 27,583,160$ 9,150,000$ 280,000$ 9,430,000$ 34.188
2018 29,528,145$ 9,547,000$ 323,000$ 9,870,000$ 33.426
2019 29,076,227$ 9,962,000$ 348,000$ 10,310,000$ 35.459
2020 29,878,176$ 10,445,000$ 355,000$ 10,800,000$ 36.147
2021 31,008,092$ 11,063,700$ 366,300$ $11,430,000 36.861
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PERSONNEL SERVICES
The 2021 budget includes a number of staffing changes. First, the Inspection Engineer was
promoted to Project Engineer and an Engineering Inspection Technician is added. A shift to a
more centralized building maintenance program will provide for two maintenance staff at the
Monticello Community Center to move into the Facilities Maintenance internal service fund.
The Community Center Director position was temporarily eliminated in November 2020 in
response to the COVID-19 pandemic; its reinstatement is under review. The city also budgeted
to add an IT Technician position mid-year with a possibility of sharing the position with a nearby
municipality. A 2.5% wage adjustment for all employees was included in the 2021 budget.
Public Works employees belong to a union, and their collective bargaining agreement expires
December 31, 2022.
Union and non-union employees participate in separate health benefit plans. The union health
benefit is $1,194 per participant, and the non-union health benefit is $827 for single plan and
$1,549 for family plan participants. The union’s plan requires a flat premium for union
employees regardless of participation. Staff will continue to explore ways to reduce future
premium increases to both the city and its employees.
The contribution rates to the Public Employees Retirement Association (PERA) will remain the
same in 2021 for both employer and employees. PERA rates: 7.50% of wages for employer and
6.50% for employee. The budget also calculates FICA and Medicare taxes at 6.20% and 1.45%
respectively for 2021.
The remainder of this section will describe the major initiatives for 2021 for each of the fund
types and their activities.
GENERAL FUND
Expenditures
The following schedule displays 2021 budgeted General Fund expenditures by department
compared with the prior year:
Department 2020 2021 % Change
General Government 1,883,967$ 2,263,166$ 20.1%
Public Safety 2,636,008 2,776,094 5.3%
Public Works 2,994,279 3,412,539 14.0%
Recreation & Culture 1,382,394 1,411,651 2.1%
Unallocated 6,352 11,550 81.8%
Total 8,903,000$ 9,875,000$ 10.9%
2021 General Fund Expenditures and Other Uses
20
The 2021 budget increased 10.9% over the 2020 budget. Personnel service 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 2021 personnel services budget includes a 2.5%
COLA adjustment to the pay scale.
The chart below presents the 2021 budgeted expenditures allocated by function/department:
The Public Works Department is the largest department in terms of budgeted expenditures
and the street and alleys activity budget is the largest activity within the department. The 2021
budget for the Public Works department increased 14%. Public Works Inspections (+52.8%),
streets & alleys (+22.0%), ice & snow (+14.2%), and shop & garage (+19.7%) budgeted
expenditures very the largest factors in the increase due to an additional Engineering position,
and increased investments in equipment. The city’s contract with its residential garbage hauler
ends on May 31, 2025.
The second largest department based on expenditures is the Public Safety Department. The
2021 Public Safety Department budget increased 5.3%. 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 2021 contract includes a $3.50 increase in the hourly service rate for 52 hours per day. The
fire and rescue activity budget increased 9.7% due to rent charges to the Central Equipment
Fund for the purchase of a new squad vehicle. While emergency management shows a 20%
increase, the dollar increase is only $1,000.
The 2021 budget for general government activities increased 20.1%. The city administration
activity increased 94.5% due to a solar farm investment (offset by rebate revenue) that came
online in 2020. The city clerk activity decreases 14.3% because 2020 was an election year and
2021 is not. The Planning & Zoning budget decreased 18.9 with the Monti:2040 Comprehensive
General
Government
23%
Public Safety
28%
Public Works
35%
Recreation &
Culture
14%
General Fund Expenditures -2021
21
Plan update being completed in 2020. The increase in city hall (+28.3%) and Prairie Center
building (+25.0%) reflects higher preventative costs under the new Facilities Maintenance
internal service fund and the installation of an additional door in city hall.
Recreation and culture increased by 2.1% in 2021. Public art (+61.2%) increased with additional
consulting time. The shade tree (+22.3%) activity budget demonstrates an increased investment
in tree care and replacement. The increase in the library (+13.9%) activity reflects higher
preventative costs under the new Facilities Maintenance internal service fund
Including services for police, assessor, and legal services, other services, and charges account
for 48% of General Fund appropriations. Appropriations for personnel services follow with 40%
of the total and rises with wage and benefit inflation plus the new position. Capital outlays
include the internal rent payments to the Central Equipment Fund. Additional equipment
purchases will translate into higher rent payments.
The following table and graph provide perspective on expenditures and other uses for the
various General Fund expenditure classifications in the 2021 budget:
Revenues and other sources
Revenues and other sources supporting General Fund expenditures and other uses are
classified as follows:
Department 2020 2021 % Change
Personnel Services 3,522,314$ 3,651,591$ 3.7%
Supplies 751,000 817,700 8.9%
Other Services & Charges 4,298,886 4,969,109 15.6%
Capital Outlay 330,800 436,600 32.0%
Total 8,903,000$ 9,875,000$ 10.9%
2021 General Fund Appropriations
Personnel
Services
40%
Supplies
9%
Other Services &
Charges
48%
Capital Outlay
3%
2021 Appropriations -General Fund
22
The General Fund’s tax levy increases by 5.6%, while the General Fund’s portion of the
combined levy (city + HRA) decreases from 62.9% to 62.7%. Franchise & other taxes decrease
with a decrease in electric costs of the street light system. Charges for services increase 18.3%
with increased garbage and recycling fees. Miscellaneous revenues increase the most at 235.8%
due to rebate received related to the solar farm investment the city began in 2020.
The property tax levy generates 73% 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 continue to be dependent on property tax revenue as its major source of
future revenues.
SPECIAL REVENUE FUNDS
The City of Monticello currently operates special revenue funds for economic development,
cemetery, and community center activities. Special revenue funds also include the Small Cities
Development Program (SCDP) Fund, which will likely see little activity in 2021 outside of one
loan to a local business.
Classification 2020 2021 % Change
Property Taxes 6,788,000$ $7,169,000 5.6%
Franchise & Other Taxes 270,000 256,500 -5.0%
Licenses & Permits 407,200 420,300 3.2%
Intergovernmental Revenues 397,200 404,000 1.7%
Charges for Services 815,900 965,300 18.3%
Fines & Forfeits 40,400 41,600 3.0%
Special Assessments 200 150 -25.0%
Miscellaneous 184,100 618,150 235.8%
Total 8,903,000$ 9,875,000$ 10.9%
2021 General Fund Revenues and Other Sources
73%
3%
4%
4%
9%
1%6%
2021 Revenues -General Fund
Property Taxes
Franchise & Other Taxes
Licenses & Permits
Intergovernmental Revenues
Charges for Services
Fines & Forfeits
Miscellaneous
23
Like the General Fund, the special revenue fund budgets are set at a level to maintain services.
The tax levy supports community center operations ($485,000) and the Economic Development
Authority ($366,300). Tax increments support economic development activities, but their use is
generally restricted to a specific activity in a specific area. 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 the COVID-19 pandemic, which caused the facility to close for 4 months in 2020.
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 in 2021:
DEBT SERVICE FUND (Aggregate of Sub-Funds)
The city's debt service for 2021 is $3,325,000, or $823,774 less than the prior year due to an
early redemption in 2020. Funding for debt service comes from special assessments, tax
increments, and property. Outstanding debt: debt service funds - $27,665,000; Sewage
enterprise fund - $3,416,000; Central Equipment internal service fund - $240,000. The city's
bond rating from Moody’s Investors Services was upgraded in 2019 to an "A1."
CAPITAL PROJECT FUNDS
The budgets for capital project funds are based on the 2021 project expenditures listed in the
city's five-year capital improvement plan. The city's five-year capital improvement plan is
included in a later section of this report. The city has two major expenditures budgeted in 2021:
pathway construction and land acquisition for a future public works facility. No debt issuances
are planned for 2021.
Classification 2020 2021 % Change
Property Taxes 772,000$ 851,300$ 10.3%
Tax Increments 617,344 617,344 0.0%
Charges for Services 1,604,800 454,100 -71.7%
Miscellaneous 127,856 212,256 66.0%
Operating Transfers - 325,000 #DIV/0!
Total 3,122,000$ 2,460,000$ -21.2%
2021 Special Revenue Funds Revenues and Other Sources
Department 2020 2021 % Change
Personnel Services 1,411,864$ 880,961$ -37.6%
Supplies 221,285 78,420 -64.6%
Other Services & Charges 690,851 737,295 6.7%
Capital Outlay 421,000 190,324 -54.8%
Operating Transfers 200,000 200,000 0.0%
Total 2,945,000$ 2,087,000$ -29.1%
2021 Special Revenue Funds Appropriations
24
ENTERPRISE FUNDS
Total revenues and other sources for the enterprise funds (Water, Sewage, Stormwater, Fiber
Optic, DMV, and Liquor) is estimated at $14,419,000 for 2021. Charges for services increases
with higher rates charged on enterprise fund customers. Operating transfers in of $200,000 are
from another the Capital Projects Fund to the Sewage Fund to replenish access fees used in
prior years for debt service. The change in Sale of Goods represents a conservative budget
policy of estimating liquor sales at the prior year level.
Personnel services increase with wage and benefit inflation of 2.5%. Capital outlay increases
due to budgeted SCADA improvements in the Water and Sewage funds. Operating transfers out
decrease due to a 2020 transfer from the Water Fund to the Capital Project Fund for a future
public works facility. The 2021 operating transfers out are from the Liquor Store to the
Monticello Community Center Fund to help with revenue shortfalls related to the COVID-19
pandemic.
INTERNAL SERVICE FUNDS
Two internal service funds were created in 2013: IT (Information Technologies) Services Fund
and Central Equipment Fund. These funds operate on a cost-recovery basis but the time
horizon for the basis differs greatly. The IT Services Fund is relatively less capital intensive with
annual small tools and equipment purchases in the $20,000 to $30,000 range. IT equipment
usually has a shorter replacement cycle. The Central Equipment Fund incurred debt to make
major purchases. Annual rental charges to benefitting budget units recover the equipment
Classification 2020 2021 % Change
Sale of Goods 6,264,651$ 6,679,000$ 6.6%
Licenses & Permits 2,000 2,000 0.0%
Charges for Services 6,529,760 7,064,112 8.2%
Special Assessments 38,000 38,000 0.0%
Miscellaneous 90,100 96,100 6.7%
Contributed Capital 339,788 339,788 0.0%
Operating Transfers 50,000 200,000 300.0%
Total 13,314,299$ 14,419,000$ 8.3%
2021 Enterprise Funds Revenues and Other Sources
Department 2020 2021 % Change
Personnel Services 1,897,654$ 2,027,951$ 6.9%
Supplies 5,235,252 5,449,799 4.1%
Other Services & Charges 3,861,388 3,697,624 -4.2%
Capital Outlay 2,000,000 3,738,000 86.9%
Debt Service 365,532 366,626 0.3%
Operating Transfers 1,370,000 325,000 -76.3%
Total 14,729,826$ 15,605,000$ 5.9%
2021 Enterprise Funds Appropriations
25
purchase costs over 7–10-year periods. Annual depreciation and inflation for each capital asset
will be used in calculating annual rental payments, which will provide funds for major
equipment replacement through annual operating budgets. Internal service fund charges are
recorded as expenditures in other funds.
A third internal service fund (Benefit Accrual Fund) was started at the end of 2015. This internal
service fund accumulates resources from governmental funds to match the city’s paid leave
(paid-time-off, sick leave, and vacation) liability for governmental fund employees. Except for
debt proceeds and interest on investments, internal service fund revenues are recorded as
expenditures in other funds.
A fourth internal service fund is budgeted for creation in 2021. A centralized Facilities
Maintenance department while operate out of this fund. Staff time for the two estimated
positions will be charged back to the proper fund for each city building’s maintenance.
FUND BALANCES
Fund balances decline when expenditures exceed revenues. The General Fund and Monticello
Community Center (MCC) Fund normally have balanced budgets where revenues equal
expenditures. The Economic Develoment Authority (EDA)’s fund balance is projected to
increase with tax increment collections to be used in future years. The fund balance in the Debt
Service Fund declines through normal debt amortization.
Additionally, the fund balance for the group of capital projects funds declines with a grant
received related to the Fallon Avenue Overpass project completed in 2018 offset by a larger
transfer out to the Central Equipment internal service fund for equipment acquisition.
Enterprise fund balances decline by nearly $1.2 million, largely the result of a water and sewage
fund SCADA system update.
CHALLENGES IN CONTEXT
The preparation of this budget reflects the need to meet both short-term and long-term
challenges. While the local economy has improved, the commercial and residential tax base is
growing slowly. Growth requires additional near-term public safety enhancements and long-
term transportation improvements. Indeed, the City Council desires to meet current and future
growth needs by maintaining a low tax capacity rate.
Second, the 2014 settlement of the telecommunication bondholder’s class-action lawsuit
provided certainty and allowed city leaders to focus on other concerns such as day-to-day
operations at Fibernet. Consequently, the city hired a third party to manage the
telecommunications utility starting July 1, 2016. Fibernet no longer requires ongoing support
from the Liquor Fund, with exception of future infrastructure investments in new
developments. Less liquor fund support will allow the city to redirect liquor store profits to
other needs.
26
Third, the city is moving ahead with a number of capital projects in 2021. Most large projects
have reimbursement resolutions, meaning the city can recover their temporary draw on
reserves with debt proceeds. A new public works facility is being considered in the next few
years.
Fourth, stable leadership is taking a longer view. An existing councilmember will become mayor
in 2021 with one new member elected and the new mayor’s council seat up for appointment.
The mayor and two councilmembers have terms expiring at the end of 2022. While policy
perspectives still exist, the mayor and council are looking at ways to meet future challenges
through increased public participation.
In summary, modest economic improvement, public safety service enhancement,
transportation improvements, stabilization in Fibernet operations, and park development
impacted the decisions made in drafting the 2021 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, 2020. 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 our belief that the
2021 budget allows the city to deliver excellent municipal services in a cost effective and
efficient manner at current levels. The 2021 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
27
ORGANIZATION CHART
Residents of
Monticello
City Commissions
Council & Boards
City
Administrator
Human Finance Community City Public Community City Fire Contracted
Resource Director Development Engineer Works Center Clerk Chief Services
Manager Director Director Director
Finance Economic Project Streets Community Elections Fire City
Department Development Engineer Department Center Department Attorney
Audit Building Construction Parks Sheriff
Inspections Inspectors Department Department
Deputy Receptionist Consulting Water &Animal
Registrar Engineer Sewage Control
Department
Liquor Consulting Refuse County
Operations Planner Collection Assessor
FiberNet
Operation
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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. All amounts over budget have been 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 Fund, 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 Comprehensive
Annual Financial Report (CAFR).
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 in the hierarchy on the following pages.
General Fund - The General Fund is used to account for all financial resources except those
required to be accounted for in another fund.
Sewage - The Sewage (enterprise) Fund is used to account for all activities necessary to provide
sewage services to the residents and businesses of the city.
Liquor - The Liquor (enterprise) Fund is used to account for the operations of the city’s liquor store.
Detail on the purposes of the nonmajor funds are included with each fund later in this report.
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GovernmentalGeneral
Special Revenue
Economic Development Authority
Fund
Cemetery Fund
Small Cities Development Program
(SCDP) Fund
Community Center Fund
Debt Service
2011A GO Refunding Bond Sub-Fund
2014A GO Bond Sub-Fund
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
Closed Bond Sub-Fund
Park & Pathway Dedication Fund
Street Lighting Improvement Fund
Street Reconstruction Fund
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ProprietaryEnterprise
Water Fund
Sewage 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 Fund, were combined for this presentation.
Principal and interest payments on debt occur in the Debt Service Fund (comprised of subfunds) ,
Sewage Fund, and Central Equipment Fund.
Community Capital Park &Liquor Deputy Water, Sewage Fiber Facilities IT Central Benefit
General EDA Cemetery Center Projects Pathway Store Registrar & Stormwater Optics Maintenance Services Equipment Accrual
GENERAL GOVERNMENT
Mayor and Council ●●●
City Administration ●●●
City Clerk ●●●
Finance ●● ●● ●● ● ●
Audit ●
City Assessing ●
Legal ●
Human Resources ●●●
Planning & Zoning ● ●●●●
City Hall ●● ●●
Prairie Center Building ●●
Economic Development ●●●
PUBLIC SAFETY
Law Enforcement ●
Fire & Rescue ●● ● ● ●
Fire Relief ●
Building Inspections ●●●
Emergency Management ●●●
Animal Control ●●
National Guard ●
PUBLIC WORKS
PW Administration ●●●●
Engineering ●●●●●
PW Inspecitons ●●●●
Streets & Alleys ●●● ●
Ice & Snow ●●
Shop & Garage ●●● ●●
Street Lighting ●●●
Refuse Collection ●
Water Utility ●● ●
Sewage Utility ●● ●
Stormwater Utility ●●
RECREATION AND CULTURE
Senior Center ●●
Park Operations ●● ● ●
Park Improvements ●●●
Park Ballfields ●●
Shade Tree ●●
Library ●●
Cemetery ●●
Community Center ●● ●
Fiber Optics ● ● ●
FUND
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BASIS OF BUDGETING
The city of Monticello budget serves several purposes:
•For the residents of the City of Monticello, 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
items. 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 considered a separate 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/expenses.
Governmental funds (the General Fund and 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 available and measurable. Expenditures are recognized
when liabilities are incurred.
Proprietary funds (Enterprise and Internal Service funds) use the modified accrual basis for
budgeting and the accrual basis for accounting. For example, accrual basis accounting differs with
the modified accrual basis by recording expenses for depreciation and compensated absences but
not debt principal payments. Each proprietary fund’s financial statements, located in the city’s
Comprehensive Annual Financial Report (CAFR), are reported on the full accrual basis. In the accrual
basis of accounting, revenues are recognized in the accounting period in which they are earned.
Expenses are recognized in the accounting period in which they are incurred.
WORKLOAD/PERFORMANCE BUDGETING
Beginning with the fiscal year 2010 budget, the city of Monticello started the development of
a workload/performance budget. The move to this type of budgeting resulted in a shift in
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.
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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
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 due
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.
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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 must be certified to the county
auditor by September 30th. The city’s proposed HRA (housing and redevelopment levy) must be
certified by September 15th. The final levies for both must be certified by December 29th.
Revenue Collection
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.
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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
1.On-going expenditures will be limited to levels which can be supported by current 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 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.
This policy also reflects the view that those who benefit from a capital project should pay for the project.
3.Major capital projects, which benefit future as well as current residents, will be financed
with current revenues as well as other financing sources (e.g. debt financing).
This policy reflects the view that those who benefit from a capital project should pay for
the project.
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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 Program (CIP) and related capital outlay line item; minor capital outlays of less than
$10,000 will be included in the regular operating budget as small tools and equipment or repairs and
maintenance.
The Capital Improvement Program (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.
Debt Administration
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.
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2.The city will repay borrowed funds within a period not to exceed the expected useful life of
the project.
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.
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
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; intent
can be expressed by the City Council, City Administrator, or Finance Director.
•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 to the Benefit Accrual internal service fund.
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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 relatively minor nature, as
compared to major capital purchases. The city plans for equipment replacement within the Capital
Improvement Program. However, unforeseen equipment problems will arise. The 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
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 a Comprehensive Annual Financial Report (CAFR) in conformity
with Generally Accepted Accounting Principles (GAAP). The report will be made available to the
public. The CAFR 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 CAFR 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 suggestions for
improvement in its financial operations from independent experts in the accounting field.
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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. The accrual basis of accounting is
used for Proprietary Funds. 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
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 Comprehensive Annual
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.
OBJECTIVES
The primary objectives, in priority order, of city of Monticello’s investment activities shall be
safety, liquidity, and yield:
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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.
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
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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 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
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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 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.
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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
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.
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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.
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.
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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.
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.
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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.
BALANCED BUDGETS
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 financial 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 policy to adopt balanced budgets for the General Fund and the Community Center
Fund. Both funds are supported by property taxes.
Property Taxes $7,169,000 Personnel Services $3,651,591
Franchise & Other Taxes $256,500 Supplies $817,700
Licenses & Permits $420,300 Other Services & Charges $4,969,109
Intergovernmental Revenues 404,000 Capital Outlay 436,600
Charges for Services 965,300 Debt Service -
Fines & Forfeits 41,600 Operating Transfers -
Special Assessments 150
Miscellaneous 618,150
Operating Transfers -
Total $9,875,000 Total $9,875,000
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 2021.
$(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
Sewage
Water
Streets Reconstruction
Street Lighting Improvement
Park & Pathway Dedication
Closed Bond Fund
Capital Project
2020A G.O. Bonds
2019A G.O. Bonds
2018A G.O. Abatement
2017A G.O. Improvement/Abate
2016A G.O. Street/Improvement
2015B G.O. Street/Improvement
2014A G.O. Judgment Bond
2011A G.O. Refunding Bond
Monticello Community Center
Minnesota Investment
Cemetery
Economic Development
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. Submitted budget requests are incorporated into a comprehensive
budget which is presented to Council at the first public budget workshop. Significant increases or
decreases from the previous budget are highlighted to focus on high-level goals for the upcoming year.
The council also reviews any departmental requests which could not be included in the first budget
draft. The council then gives feedback for staff to research and present at the next public budget
workshop. Following any adjustments to the proposed budget, a tentative appropriation resolution is
prepared, and a public hearing is held. The Council may again adjust the budget following the public
hearing, after which time, the Council passes the appropriation resolution in final form.
Appropriations are established by budget unit. The accounting system, budgeting system, and the
budget document itself, however, break these classes into subclasses--thereby providing more detailed
information. As an example, operating supplies, gas and oil, and subscriptions are all classified as
operating expenses. The accounting and budgeting systems provide detail for these specific sub-classes.
However, appropriation control is exercised only at the budget unit level.
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 budget commentary.
•The sixth section provides detailed financial information.
The financial information includes expenditure information for the last two completed fiscal years, the
budgeted and projected amounts for the current year, 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.
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.
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BUDGET CALENDAR/PROCEDURES
The following budget timeline outlines the process the city customarily follows for creation and
adoption of the 2021 budget.
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 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 act 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.
Date Activity
May 11, 2020 2021-2025 capital equipment/projects (CIP) worksheets and budget
worksheets to department heads.
June 8, 2020 Workshop with city council and staff to discuss COVID-19 impacts and
preliminary 2021 budget planning
June 26, 2020 2021-2025 CIP and budget worksheets due to finance department
July, 2020
Department heads meet with various advisory boards and commissions for
input into 2021 preliminary budget and CIP.
Department directors and supervisors meet with city administrator and
finance staff to develop 2021 preliminary budget and CIP.
July 13, 2020
Workshop with city council to set 2021 goals and priorities and review draft
department budgets and CIP. Finance department develops revenue
estimates and 2021 preliminary property tax levy.
August 10, 2020 Workshop with city council to review draft budget and CIP.
August 24, 2020 Council adopts 2021 preliminary HRA and city property tax levy. (See
September 28)
September 28, 2020 Last regular meeting for city council to consider adopting the 2021 preliminary
city property tax levy.
September 30, 2020 2021 preliminary property tax levy certification due to Wright County auditor.
October/November, 2020 Department heads meet with city administrator and finance staff to refine
2021 proposed budget and final property tax levy. County mails TNT notices.
December 14, 2020 Council adopts 2021 budget and property tax levy.
December 28, 2020 City certifies final 2021 property tax levy to Wright County auditor and files
Form TNT with the MN Department of Revenue.
January 1, 2021 2021 fiscal year begins.
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The Finance Department reviews the budget reports monthly 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 council.
Significant changes in either expenditures or revenues 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. The 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 reviews 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.
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ALL FUNDS SUMMARY BY FUND TYPE
In most years, the city adopts a balanced budget for the General Fund and the Monticello
Community Center Fund (MCC), a 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.
Capital Project Funds commonly accumulate resources in one budget period and expend those
resources over multiple budget periods. Transfers from enterprise funds for future projects are
planned in 2020.
Debt amortization and early redemption of issue will 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.
Internal service funds provide services to other funds and typically function on a cost recovery
basis. The city has three: IT Services Fund, Central Equipment Fund, and Benefit Accrual Fund.
Central Equipment Fund equipment purchases will exceed lease revenue in 2020. The Benefit
Accrual Fund is the only one of the three that is not used for capital asset acquisitons.
Special Debt Capital Internal 2021
General Revenue Service Project Enterprise Service Total
Fund Funds Funds Funds Funds Funds Budget
Fund Balance/Working Capital - Jan. 1 6,677,250$ 8,415,207$ 1,170,598$ 19,112,258$ 13,348,485$ 1,134,542$ 49,858,340$
Revenues and Other Sources
Property Taxes $7,169,000 851,300$ 2,831,479$ 578,221$ -$ -$ 11,430,000$
Tax Increments - 617,344 - - - - 617,344
Franchise & Other Taxes 256,500 - - $110,000 - - 366,500
Sale of Goods - - - - 6,679,000 - 6,679,000
Licenses & Permits 420,300 - - - 2,000 - 422,300
Intergovernmental Revenues 404,000 - - 2,100,000 - - 2,504,000
Charges for Services 965,300 454,100 - - 7,064,112 989,100 9,472,612
Fines & Forfeits 41,600 - - - - - 41,600
Special Assessments 150 - 229,595 205,575 38,000 - 473,320
Miscellaneous 618,150 212,256 8,926 102,204 96,100 9,900 1,047,536
Contributed Capital - - - - 339,788 - 339,788
Operating Transfers In - 325,000 200,000 1,094,000 200,000 560,000 2,379,000
Debt Proceeds - -- - - - -
Total Revenues and Other Sources 9,875,000$ 2,460,000$ 3,270,000$ 4,190,000$ 14,419,000$ 1,559,000$ 35,773,000$
Expenditures and Other Uses
Personnel Services 3,651,591 880,961 - - 2,027,951 261,772 6,822,275
Supplies 817,700 78,420 - - 5,449,799 51,700 6,397,619
Other Services & Charges 4,969,109 737,295 - - 3,697,624 225,028 9,629,056
Capital Outlay 436,600 190,324 - 2,440,000 3,738,000 939,500 7,744,424
Debt Service - - 3,325,000 - 366,626 67,000 3,758,626
Operating Transfers Out - 200,000 - 1,854,000 325,000 - 2,379,000
Total Expenditures and Other Uses 9,875,000 2,087,000 3,325,000 4,294,000 15,605,000 1,545,000 36,731,000
Net Change in
Fund Balance/Working Capital -$ 373,000$ (55,000)$ (104,000)$ (1,186,000)$ 14,000$ (958,000)$
Fund Balance/Working Capital - Dec. 3 6,677,250$ 8,788,207$ 1,115,598$ 19,008,258$ 12,162,485$ 1,148,542$ 48,900,340$
All FUNDS SUMMARY - BY FUND TYPE
52
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 2021
budgeted revenues for these major categories for all funds combined. Debt proceeds are not
shown as the city does not anticipate issuing debt in 2021.
REVENUES BY TYPE, GENERAL FUND ONLY— Using those same categories of revenue type, 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 all funds, levying 63% of the total city
and HRA combined tax levy.
Property Taxes
32%Tax Increments
2%
Franchise &
Other Taxes
1%
Sale of Goods
19%
Licenses &
Permits
1%
Intergovernment
al Revenues
7%
Charges for Services
26%Special
Assessments
1%
Miscellaneous
3%
Contributed
Capital
1%
Operating
Transfers
7%
2021 Revenues by Category -All Funds
73%
3%
4%
4%
9%
1%6%
2021 Revenues by Category -General Fund
Property Taxes
Franchise & Other Taxes
Licenses & Permits
Intergovernmental Revenues
Charges for Services
Fines & Forfeits
Miscellaneous
53
The General Fund is the city’s primary property tax levying fund, and it accounts for
28%of the overall budgeted revenues of the city. This is an increase from 27% in 2020.
Special revenue funds, totaling 7% of appropriations (down from 9% in 2020), rely
mainly on property taxes, tax increments, and charges for services.
The Debt Service Fund includes only non-enterprise and non-internal service fund debt.
These funds represent 9% of the city’s 2021 budgeted revenues and are supported
with property taxes, special assessments, and interfund operating transfers. This is a
decrease from 10% in 2020.
Capital project funds total 12% (up slightly from 13% in 2020) of budgeted revenues,
which includes financing from bond proceeds, special assessments, and
intergovernmental revenues for street construction, street lighting and park
improvements, and other governmental capital asset acquisitions excluding internal
service funds.
Enterprise funds consist of water, sewage, 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 42% of the overall
appropriations, which is an increase from 40% in 2020.
Internal Service funds consist of facilities maintenance, IT services, central equipment,
and benefits accrual. These funds are funded from staff allocation or rental charges
from other funds of the city. Appropriations are 4% of the city’s 2021 budget, which is
an increase from 2% in 2020.
General
28%Special Revenue
7%
Debt Service
9%
Capital Projects
12%
Enterprise
40%
Internal Service
4%
2021 Revenues by Fund Type
54
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 (other financing uses). The
chart below shows the relative percentage of 2021 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, as a whole. The General Fund supports very
little capital improvements and no debt service compared to all funds overall.
Personnel
Services
19%
Supplies
17%
Other Services &
Charges
26%
Capital Outlay
21%Debt Service
10%
Operating
Transfers
7%
2021 Appropriations by Category -All Funds
Personnel
Services
40%
Supplies
9%
Other Services &
Charges
48%
Capital Outlay
3%
2021 Appropriations by Category -General Fund
55
In governmental agencies, salaries, wages, and benefits (personnel services) 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 is the city’s primary operating fund for general government
operations, and it accounts for 27% of the overall appropriations of the city. This is an
increase from 25% in 2020.
Special revenue funds, totaling 6% of appropriations (down from 8% in 2020), 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 9% of the city’s 2021 appropriations for bond principal and
interest payments. This is a decrease from 12% in 2020.
Capital project funds total 12% (up slightly from 11% in 2020) of appropriations, which
includes costs for street construction, street lighting and park improvements, and other
governmental capital asset acquisitions excluding internal service funds.
Enterprise funds consist of water, sewage, stormwater, liquor, deputy registrar (DMV),
and fiber optics funds. These funds operate on a self-supporting basis and are
responsible for 42% of the overall appropriations. This is the same as 2020.
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 4% of the city’s 2021 budget, which is an
increase from 2% in 2020.
General
27%Special Revenue
6%
Debt Service
9%
Capital Projects
12%
Enterprise
42%
Internal Service
4%
2021 Appropriations by Fund Type
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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 2021 budgeted
operating transfers:
Fund No.Transfer Out Fund Amount Fund No.Transfer In Fund Amount
213 Economic Development 200,000$ 312 2011A GO Improvement Bond 200,000$
609 Liquor 325,000 226 Community Center 325,000
400 Capital Projects 200,000 662 Sewage (access charge subfund)200,000
212 Streets Reconstruction 1,654,000 404 Park & Pathway Dedication 1,094,000
703 Central Equipment 560,000
Total Transfers Out 2,379,000$ Total Transfers In 2,379,000$
SCHEDULE OF OPERATING TRANSFERS
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ALL FUNDS SUMMARY - BY YEAR
Intergovernmental revenues are projected to increase in 2021 due the city receiving $2.1 million
of Federal funds related to the Fallon Avenue Overpass project completed in 2018. Special
assessments will increase due to new assessments levied in 2020 for the street reconstruction
project. Miscellaneous revenues increase due to rebates from Xcel Energy on the city’s electric
bills for a solar farm investment through Novel Solar. No debt issuances are planned in 2021,
causing a decrease in debt proceeds.
Personnel services remain steady. A 2.5% wage and health benefit increase are budgeted in
2021. However, decreases in certain staffing due to the COVID-19 pandemic prevented an
increase in the overall personnel services budget. Capital outlay increase in 2021 due to a
SCADA system upgrade, stormwater pond improvements, and increased investment in capital
equipment. Debt service decreases due to an early redemption of one bond issue in 2020
TOTAL ALL FUNDS 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 9,946,415$ 10,353,652$ 10,800,000$ 10,800,000$ 11,430,000$ 5.8%
Tax Increments 638,278 679,925 617,344 617,344 617,344 0.0%
Franchise & Other Taxes 407,757 454,750 370,000 370,000 366,500 -0.9%
Sale of Goods 6,086,293 6,374,153 6,264,651 6,264,651 6,679,000 6.6%
Licenses & Permits 507,674 607,180 409,200 409,200 422,300 3.2%
Intergovernmental Revenues 907,625 896,638 397,200 397,200 2,504,000 530.4%
Charges for Services 9,849,648 9,230,450 9,525,760 8,475,760 9,472,612 -0.6%
Fines & Forfeits 45,350 40,054 40,400 40,400 41,600 3.0%
Special Assessments 726,202 731,937 336,304 460,824 473,320 40.7%
Miscellaneous 889,834 2,025,698 533,353 887,583 1,047,536 96.4%
Contributed Capital 914,666 1,457,482 339,788 339,788 339,788 0.0%
Operating Transfers 2,512,845 7,554,858 1,570,000 2,035,000 2,379,000 51.5%
Debt Proceeds 5,024,333 8,131,662 2,200,000 2,200,000 - -100.0%
TOTAL REVENUES 38,456,920$ 48,538,439$ 33,404,000$ 33,297,750$ 35,773,000$ 7.1%
EXPENDITURES
Personnel Services 6,092,637$ 6,279,102$ 6,831,832$ 6,429,727$ 6,822,275$ -0.1%
Supplies 5,855,329 5,973,021 6,242,737 6,115,584 6,397,619 2.5%
Other Services & Charges 9,619,933 9,362,204 9,018,425 9,274,165 9,629,056 6.8%
Capital Outlay 11,427,782 8,604,112 6,826,300 7,091,300 7,744,424 13.4%
Debt Service 3,308,979 3,984,824 4,648,706 4,648,706 3,758,626 -19.1%
Operating Transfers 2,512,845 7,554,858 1,570,000 2,035,000 2,379,000 51.5%
TOTAL EXPENDITURES 38,817,505$ 41,758,121$ 35,138,000$ 35,594,482$ 36,731,000$ 4.5%
FUND BALANCE - JANUARY 1 45,735,339$ 45,374,754$ 52,155,072$ 52,155,072$ 49,858,340$
Excess (Deficiency) of
Revenues over Expenditures (360,585) 6,780,318 (1,734,000) (2,296,732) (958,000)
FUND BALANCE - DECEMBER 31 45,374,754$ 52,155,072$ 50,421,072$ 49,858,340$ 48,900,340$
58
causing a large payment. Operating transfers are higher in 2021 because of a transfer to close
out the dormant Streets Reconstruction Fund.
Capital outlay expenditures reflect disbursements for acquisition or replacement of assets with
long-lives (benefit two or more accounting periods) and usually have significant price tags. In
contrast, current expenditures only benefit the current or next accounting period and usually
have smaller price tags. Capital expenditures can be recurring or non-recurring in nature. The
construction of a new fire hall would be an example of non-recurring capital expenditure. On the
other hand, the city budgets annually $200,000-$500,000 to replace or repair streets. This would
be an example of a recurring capital expenditure. Recurring capital expenditures usually have a
pay-as-you-go funding source (enterprise funds) and non-recurring capital expenditures typically
include debt as a funding component.
More detailed information on each fund, including the major funds, is included later in the
report.
59
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 balance in the debt services subfunds for 2016A and 2020A are projected to decrease
by more than 10% to spend down prepaid assessment revenues received. The 2019A bond
subfund is budgeted increase by more than 10% due to levying 105% of the 2021 payments to
avoid cash shortfalls if there are delinquencies in property tax payments.
The Closed Bond Fund is budgeted to increase by 18%, reflecting special assessment revenue
coming in, but no anticipated expenditures in 2021. The Park & Pathway Dedication Fund is
scheduled to increase by 44% due to a transfer in for future use. The Streets Reconstruction
Fund will be closed in 2021 so the fund balance will decrease to $0.
The Sewage and Stormwater funds’ working capital balances are estimated to decrease by
more than 10%, which reflects capital improvements paid with existing funds. The Liquor Fund
working capital is budgeted to increase to set aside new revenues for future project use. The
working capital of the Fiber Optics Fund is projected to decrease with costs to expand service to
new neighborhoods.
60
Projected Beginning Projected Ending
Fund Balance/Estimated Fund Balance/
Working Capital Revenues Appropriations Working Capital
General Fund 6,677,250$ 9,875,000$ 9,875,000$ 6,677,250$
Special Revenue Funds
Economic Development 7,475,264 1,186,000 818,000 7,843,264
Cemetery 26,074 33,000 33,000 26,074
Minnesota Investment 913,869 5,000 - 918,869
Monticello Community Center - 1,236,000 1,236,000 -
Total Special Revenue Funds 8,415,207 2,460,000 2,087,000 8,788,207
Debt Service Funds
2011A G.O. Refunding Bond 47,100 201,000 200,000 48,100
2014A G.O. Judgment Bond 147,388 515,000 513,000 149,388
2015B G.O. Street/Improvement 118,760 225,000 214,000 129,760
2016A G.O. Street/Improvement 345,074 489,000 527,000 307,074
2017A G.O. Improvement/Abate 284,231 474,000 473,000 285,231
2018A G.O. Abatement 78,940 449,000 447,000 80,940
2019A G.O. Bonds 24,585 730,000 715,000 39,585
2020A G.O. Bonds 124,520 187,000 236,000 75,520
Total Debt Service Funds 1,170,598 3,270,000 3,325,000 1,115,598
Capital Project Funds
Capital Project 14,981,715 2,793,000 1,790,000 15,984,715
Closed Bond Fund 866,698 156,000 - 1,022,698
Park & Pathway Dedication 891,341 1,141,000 750,000 1,282,341
Street Lighting Improvement 718,504 100,000 $100,000 718,504
Street Construction 1,654,000 - 1,654,000 -
Total Capital Project Funds 19,112,258 4,190,000 4,294,000 19,008,258
Enterprise Funds
Water 4,016,882 1,600,000 1,935,000 3,681,882
Sewage 5,323,984 3,120,000 3,879,000 4,564,984
Stormwater 1,587,934 448,000 858,000 1,177,934
Liquor 429,420 6,684,000 6,259,000 854,420
Deputy Registrar 1,973,234 702,000 645,000 2,030,234
Fiber Optics 17,031 1,865,000 2,029,000 (146,969)
Total Enterprise Funds 13,348,485 14,419,000 15,605,000 12,162,485
Internal Service Funds
Facilities Maintenance - 292,000 292,000 -
IT Services 281,498 248,000 248,000 281,498
Central Equipment 553,128 1,000,000 989,000 564,128
Benefit Accrual 299,916 19,000 16,000 302,916
Total Internal Service Funds 1,134,542 1,559,000 1,545,000 1,148,542
Total All Funds 49,858,340$ 35,773,000$ 36,731,000$ 48,900,340$
CHANGES IN FUND BALANCE/WORKING CAPITAL - FISCAL YEAR 2021
61
Adopted
Actual Actual B udget Projected Budget
2018 2019 2020 2020 2021
General Fund 7,109,478$ 6,677,250$ 6,677,250$ 6,677,250$ 6,677,250$
Special Revenue Funds
Economic Development 7,240,465 7,313,264 7,475,264 7,475,264 7,843,264
Cemetery 52,059 26,074 26,074 26,074 26,074
Minnesota Investment 872,983 898,869 913,869 913,869 918,869
Monticello Community Center 606,795 239,482 239,482 - -
Total Special Revenue Funds 8,772,302 8,477,689 8,654,689 8,415,207 8,788,207
Debt Service Funds
2010A G.O. Improvement Bond (Closed)793,743 - - - -
2011A G.O. Refunding Bond (2005A)896,336 893,148 47,100 47,100 48,100
2014A G.O. Judgment Bonds 90,886 121,688 147,388 147,388 149,388
2015B G.O. Street/Improvement 94,095 109,416 118,760 118,760 129,760
2016A G.O. Street/Improvement 348,442 366,626 345,074 345,074 307,074
2017A G.O. Improvement/Abatement 163,015 268,629 284,231 284,231 285,231
2018A G.O. Improvement/Abatement 5,027 57,043 78,940 78,940 80,940
2019A G.O. Bonds - 5,011 24,585 24,585 39,585
2020A G.O. Bonds - -- 124,520 75,520
Total Debt Service Funds 2,391,544 1,821,561 1,046,078 1,170,598 1,115,598
Capital Project Funds
Capital Project 6,913,850 14,396,702 14,981,715 14,981,715 15,984,715
Closed Bond Fund 613,649 791,698 866,698 866,698 1,022,698
Park & Pathway Dedication 696,465 939,341 891,341 891,341 1,282,341
Stormwater Access 1,358,936 - - - -
Street Lighting Improvement 602,585 788,504 718,504 718,504 718,504
Street Construction 1,711,361 1,633,770 1,653,770 1,654,000 -
Total Capital Project Funds 11,896,846 18,550,015 19,112,028 19,112,258 19,008,258
Enterprise Funds
5,471,876 5,028,065 4,016,882 4,016,882 3,681,882
4,917,894 5,898,611 5,323,984 5,323,984 4,564,984
- 1,488,947 1,587,934 1,587,934 1,177,934
2,056,680 784,310 894,420 429,420 854,420
1,271,258 1,808,048 1,973,234 1,973,234 2,030,234
Water
Sewage
Stormwater
Liquor
Deputy Registrar
Fiber Optics 399,862 221,031 17,031 17,031 (146,969)
Total Enterprise Funds 14,117,570 15,229,012 13,813,485 13,348,485 12,162,485
Internal Service Funds
Facilities Maintenance - - - - -
IT Services 174,660 280,401 281,498 281,498 281,498
Central Equipment 651,794 855,728 553,128 553,128 564,128
Benefit Accrual 260,560 263,416 282,916 299,916 302,916
Total Internal Service Funds 1,087,014 1,399,545 1,117,542 1,134,542 1,148,542
Total All Funds 45,374,754$ 52,155,072$ 50,421,072$ 49,858,340$ 48,900,340$
FUND BALANCE/WORKING CAPITAL HISTORY
Fiscal Year Ended December 31,
62
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, Sewage, 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.
Tax increments are the main source of revenue for the Economic Development Fund. This fund
accounts for the city’s tax increment financing (TIF) districts and other general economic
development activities.
Sales of goods reflect sales at the city’s municipal Hi-Way Liquors store.
Intergovernmental revenues will increase with the receipt of Federal funds related to the Fallon
Avenue Overpass project completed in 2018. With a strong commercial tax base, the city
generally does not qualify for state aid that is not project specific.
Charges for services reflect some changes to the fee schedule occurring prior to adoption of the
budget, 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.
TOTAL ALL FUNDS 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 9,946,415$ 10,353,652$ 10,800,000$ 10,800,000$ 11,430,000$ 5.8%
Tax Increments 638,278 679,925 617,344 617,344 617,344 0.0%
Franchise & Other Taxes 407,757 454,750 370,000 370,000 366,500 -0.9%
Sale of Goods 6,086,293 6,374,153 6,264,651 6,264,651 6,679,000 6.6%
Licenses & Permits 507,674 607,180 409,200 409,200 422,300 3.2%
Intergovernmental Revenues 907,625 896,638 397,200 397,200 2,504,000 530.4%
Charges for Services 9,849,648 9,230,450 9,525,760 8,475,760 9,472,612 -0.6%
Fines & Forfeits 45,350 40,054 40,400 40,400 41,600 3.0%
Special Assessments 726,202 731,937 336,304 460,824 473,320 40.7%
Miscellaneous 889,834 2,025,698 533,353 887,583 1,047,536 96.4%
Contributed Capital 914,666 1,457,482 339,788 339,788 339,788 0.0%
Operating Transfers 2,512,845 7,554,858 1,570,000 2,035,000 2,379,000 51.5%
Debt Proceeds 5,024,333 8,131,662 2,200,000 2,200,000 - -100.0%
TOTAL REVENUES 38,456,920$ 48,538,439$ 33,404,000$ 33,297,750$ 35,773,000$ 7.1%
63
Miscellaneous revenues, including donations, interest earned on investments, and rebates
related to a solar farm investment, are conservatively estimated. However, the investment
earnings—the largest portion of this revenue classification—are expected to hold steady.
Overall revenues and other sources lag expenditures and other uses.
Operating transfers (in) are expected to increase in 2021 because the unused Streets
Reconstruction fund will be closed and transferred to other funds. Transfers in 2019 include a
reclassification of the Stormwater fund from a department in the General Fund to its own
enterprise fund. In 2018, 2019 and budgeted in 2020, the enterprise funds transferred to the
capital project funds for the future construction of a new public works facility.
No debt issuances are scheduled for 2021.
The chart below provides an overall picture of estimated 2020 revenues and other sources.
PROPERTY TAXES
The city relies on property taxes to support functions such as general government, public
safety, public works, recreation and culture, and debt service. For 2021, the council adopted a
general levy of $11,063,70, which is $618,700 (5.9%) greater than the prior year. The council
also adopted a Housing and Redevelopment Authority (HRA) special benefit levy of $366,300,
which is $11,300 (3.2%) greater than the prior year. The HRA levy is recorded in the Economic
Development Authority (EDA) Fund. Both levies are combined for graphical and contextual
purposes.
Property Taxes
32%Tax Increments
2%
Franchise &
Other Taxes
1%
Sale of Goods
19%
Licenses &
Permits
1%
Intergovernmen
tal Revenues
7%
Charges for Services
26%Special
Assessments
1%Miscellaneous
3%
Contributed
Capital
1%
Operating
Transfers
7%
2021 Revenues by Category -All Funds
64
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 63% of the 2021 property
tax levy. However, property taxes provide 73% of the General Fund’s revenue. The levy for the
Monticello Community Center (MCC) increased $68,000 (16.3%) to $485,000. The following
chart represents the distribution of the tax levy for 2021.
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.
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
2012 2013 2014 2015 2016 2017 2018 2019 2021 2021
City & HRA Property Tax Levy History
City Levy HRA Levy
General Fund,
$7,169,000 , 63%
MCC
Operations,
$485,000 , 4%
HRA Levy,
$366,300 , 3%
Capital,
$578,221 , 5%
Debt Service,
$2,831,479 , 25%
Property Tax Levy (Adopted 2021)
65
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 $9,875,000 (+6.6%) for the 2021 budget year. The primary General
Fund source of revenue is property taxes at $7,169,000 (+5.6%), which accounts for 73% of total
revenues. At 10% and 6%, 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 2020 adopted budget:
The following chart represents General Fund revenues trends.
General Fund Revenues -2021
Property Taxes (73%)
Franchise & Other Taxes
Licenses & Permits
Intergovernmental
RevenuesCharges for Services
All Other
$-
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
$9,000,000
$10,000,000
ACTUAL ACTUAL BUDGET BUDGET
2018 2019 2020 2021
Revenues -General Fund
Miscellaneous
Fines & Forfeits
Charges for Services
Intergovernmental
Revenues
Licenses & Permits
Franchise & Other Taxes
Property Taxes
66
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 now requires the MCC to cover 85% of its
operating costs—including equipment—with fees and charges. The effects of the COVID-19
pandemic have shifted the ability of this fund to meet that threshold.
In the following chart, 2016 through 2018 are actual amounts and 2019 and 2020 are estimates.
Reflecting a policy change, some activity fees were rolled into membership fees in 2017 and 2018.
WATER AND SEWAGE FUNDS
Water and sewage charges for services are primarily comprised of providing Monticello residents
and businesses with water and sewage 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. As new development slowed, the
burden on infrastructure replacement costs shifted to utility rates from access charges. The water
and sewage funds are expected to provide some level of future support for debt service incurred
to make water and sewage system improvements.
In 2018, the sewage fund sold a parcel of property that had been used for storage and a bio-solids
site. With 2019 actual and 2020 budgeted, the following chart plots revenues for water and
sewage services on the primary axis (left) against water sales on the secondary axis (right):
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
ACTUAL ACTUAL BUDGET BUDGET
2018 2019 2020 2021
Revenues -Community Center Fund
Operating Transfers
Miscellaneous
Charges for Services
Property Taxes
67
Water service charges have two components: base charge with a minimum usage amount and
consumption charge for usage above the minimum amount. Both charges have increased steadily
over the last ten years: average base and consumption charge increases were 6.5%. Sewage
charges, like water charges, have two components: base charge with a minimum usage amount
and consumption charge for usage above the minimum amount. Both charges have increased
steadily over the years: average base and consumption charge increases were 6.3%. For 2021,
base rate increases of 10% and usage increases of 5% were included in the budget for both funds.
The following chart reflects the water and sewage base rates over the last ten years:
STORMWATER FUND
The Stormwater Fund was established in 2019 with a user charge of $1.00/month per drainage
unit. 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
$3/month in 2021. Expenses in this fund were accounted for in the General fund prior to 2020.
FIBER OPTICS FUND (FiberNet)
Monticello’s telecommunications utility, FiberNet Monticello, provides internet, voice (telephone)
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
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Gallons Sold (Millions)Revenues (Millions)2021 Revenues by Fund Type
Water Revenue
Sewage Revenue
H20 Sold (Gallons)
$-
$2
$4
$6
$8
$10
$12
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021Monthly ChargeSewage and Water Base Rates
Sewage
Water
68
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. 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. Still,
commercial and residential customers are benefitting from lower bills with FiberNet’s presence in
the marketplace even if they are not FiberNet customers.
The data in the graphs below show a stable competitive environment for FiberNet in 2020.
In July 2016, the city contracted with Arvig to manage FiberNet. All FiberNet employees became
Arvig employees. Through leaner operations, shared resources, and economies of scale, the city
expects to have a positive cash flow in 2020 from daily operations. However, potential new service
areas will cause increases in capital costs. Arvig will continue to assess the marketplace and service
delivery costs and will raise prices as needed.
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. An increase
in state approved fees in 2012, along with better economic conditions resulted in higher revenues.
The following chart shows the history of DMV transactions over a five-year period.
1,641 1,646 1,647 1,670 1,687 1,692 1,713 1,725 1,742 1,782 1,789 1,801
379 370 363 354 351 345 343 340 337 336 337 323 351 349 348 348 347 343 340 333 329 326 327 315
0
500
1,000
1,500
2,000
2,500
2020 Total Subscribed Services
Phone
Television
Internet
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
$800,000
$900,000
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
2015 2016 2017 2018 2019 2020
DMV Transactions by Type & Annual Revenues
Drivers License ($8)
Game & Fish ($1)
DNR ($2-$7)
Motor vehicle ($6-$10)
Annual Revenue
69
Beer accounts for approximately 52% of total sales; liquor and wine follow at 32% and 13%,
respectively. Non-alcohol items contribute 3%. Beer typically has the lowest gross margin at 23%
and wine the highest at 40%. Liquor is in the middle at about 30%. The chart below provides sales
information by category:
Beer
52%
Liquor
32%
Wine
13%
Misc.
3%
Motor vehicle licenses (new and renewals) as percentage of total transactions increased slightly
from 93% in 2019 to 91% in 2020. A new state licensing system (MNLARS) counts vehicle
transactions differently, skewing transaction comparisons with prior years. Nevertheless, 2020 was
an incredibly busy year for the DMV as the COVID-19 pandemic caused changes in operations and
the State completed the transition from MNLARS to MNDrive in November 2020.
LIQUOR FUND
With total 2020 sales of $7.4 million, Monticello’s municipal liquor store ranks near the top of
Minnesota cities with only one store. While the COVID-19 pandemic caused a rapid increase in
sales in 2020, revenue growth is expected to slow because of store size limitations. Total sales
have climbed an average of 6.3% for the last five years (16.2% alone in 2020); liquor is the fastest
growth category averaging nearly 45% over five years.
Liquor sales have increased over the last five years and the budget reflects this trend. The Liquor
Fund has one retail outlet: Hi-Way Liquors. This fund provides vital resources for many
community projects including Bertram Chain of Lakes and other capital improvements.
Conservative revenue estimates are used for budgeting purposes. However, 2021 net cash flow
from operations should top $400,000. Interest earnings contributed significantly to net cash flows.
Hi-Way Sales by Category - 2020
70
Liquor Store Revenue by Category
Category 2016 2017 2018 2019 2020 5 Yr Chg
Beer 2,768,394$ 2,933,853$ 3,074,408$ 3,252,142$ 3,838,912$ 39%
% Change 0.1% 6.0% 4.8% 5.8% 18.0%
Liquor 1,624,908$ 1,739,562$ 1,909,953$ 2,019,096$ 2,351,072$ 45%
% Change -0.6% 7.1% 9.8% 5.7% 16.4%
Wine 889,082$ 894,151$ 904,385$ 894,005$ 982,113$ 10%
% Change -4.2% 0.6% 1.1% -1.1% 9.9%
Other 171,420$ 192,616$ 201,481$ 263,998$ 235,777$ 38%
% Change 3.5% 12.4% 4.6% 31.0% -10.7%
Total Sales 5,453,804$ 5,760,182$ 6,090,227$ 6,429,241$ 7,407,874$ 36%
% Change -0.7% 5.6% 5.7% 5.6% 15.2%
71
TAX LEVY HISTORY
2018 2019 2020 2021
General Fund $6,590,000 $6,670,000 $6,788,000 $7,169,000
Percent Change 4.8% 1.2% 1.8% 5.6%
Special Revenue Funds
Economic Development (HRA Levy)323,000 348,000 355,000 366,300
Monticello Community Center 387,000 402,000 417,000 485,000
Total Special Revenue Funds 710,000 750,000 772,000 851,300
Percent Change 8.9% 5.6% 2.9% 10.3%
Debt Service Fund
2011A GO Refunding Bonds 148,061 150,581 172,641 -
2010A GO Bonds 40,000 - - -
2014A GO Judgement Bonds 537,586 537,244 535,501 513,570
2015B GO Bonds 203,425 200,905 198,385 201,115
2016A GO Bonds 407,769 409,134 405,039 406,089
2017A GO Bonds 450,159 429,782 427,367 430,097
2018A GO Bonds - 500,000 472,434 448,077
2019A GO Bonds - -728,620 714,945
2020A GO Bonds - -- 117,586
Total Debt Service Fund 1,787,000 2,227,646 2,939,987 2,831,479
Percent Change -26.7% 24.7% 32.0% -3.7%
Capital Project Funds
Capital Projects Fund 783,000 662,354 300,013 578,221
Total Capital Project Funds 783,000 662,354 300,013 578,221
Percent Change 1466.0% -15.4% -54.7% 92.7%
Total Tax Levy - All Funds 9,870,000$ 10,310,000$ 10,800,000$ 11,430,000$
Percent Change 4.7% 4.5% 4.8% 5.8%
Levy Summary
City General and Debt Levies 9,547,000$ 9,962,000$ 10,445,000$ 11,063,700$
Percent Change 4.3% 4.3% 4.8% 5.9%
HRA Levy 323,000$ 348,000$ 355,000$ 366,300$
Percent Change 15.4% 7.7% 2.0% 3.2%
TAX LEVY HISTORY
72
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 2020 totaled
$2,020,568,150. HRA levy proceeds can only be used for purposes included in the HRA Act
(Minnesota Statutes, Section 469.033, subd. 6). Those purposes include redevelopment to
correct or prevent blight and development of, or assistance to, housing for low- or moderate-
income persons.
In 2020, Northern States Power (dba Xcel Energy), the city’s largest taxpayer, succeeded in
getting the Minnesota Department of Revenue to lower the estimated market value of its
nuclear power plant. However, Xcel’s estimated market value drop did not exceed residential
and commercial tax base growth, therefore, Xcel still absorbs a portion of the city’s tax levy
increase.
The graph below reflects the annual change in the city’s property tax levy and the annual
change in Xcel’s property taxes owed. When the green column is larger than the blue column,
Xcel absorbed the entire levy and lowered the taxes paid by others. In 2019, the green column
was in negative territory. In this case, other taxpayers picked up the entire levy increase plus
the amount Xcel’s taxes declined.
2018 2019 2020 2021
Tax Capacity 29,528,145$ 29,076,227$ 29,878,176$ 31,008,092$
Percent Change 7.1% -1.5% 2.8% 3.8%
City Levy - Tax Capacity Rate 32.332 34.262 34.959 35.680
Percent Change -2.5% 6.0% 2.0% 2.1%
HRA Levy - Tax Capacity Rate 1.094 1.197 1.188 1.181
Percent Change 7.8% 9.4% -0.7% -0.6%
TAX CAPACITY HISTORY
$(300,000)
$(200,000)
$(100,000)
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
2017 2018 2019 2021 2021
City Levy and Xcel Property Tax Change
City Levy Increase Xcel Change in City Taxes
73
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 1 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%. This tax capacity decline means the city’s
other taxpayers absorbed more of the tax levy.
Tax
Year Amount Change $$Amount $$ C hange % Chg.Amount $$ Change % Chg.
2012 298,023,900$ 5,960,478$ 2,966,335$
2013 479,449,000$ 181,425,100$ 9,588,980$ 3,628,502$ 61% 4,052,178$ 1,085,843$ 37%
2014 448,484,200$ (30,964,800)$ 8,969,684$ (619,296)$ -6% 4,010,278$ (41,900)$ -1%
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% 5,599,490$ (77,006)$ -1%
2020 780,422,700$ (9,149,800)$ 15,608,454$ (182,996)$ -1% 5,641,988$ 42,498$ 1%
2021 806,039,800$ 25,617,100$ 16,120,796$ 512,342$ 3% 5,942,287$ 300,299$ 5%
Northern States Power (dba Xcel Energy)
Taxable Market Value Tax Capacity City Property Tax on Plant
$298
$479 $448
$707
$780 $832 $878
$790 $780 $806
$-
$100
$200
$300
$400
$500
$600
$700
$800
$900
$1,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021MillionsXcel Power Plant -Taxable Market Value
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75
REVENUE SOURCES BY FUND
Revenue Classifications
Property Franchise Tax Licenses/ Intergovern-Charges for
Taxes & Other Increments Permits mental Services
General Fund 7,169,000$ 256,500$ -$ 420,300$ 404,000$ 965,300$
Special Revenue Funds
Economic Development 366,300 - 617,344 - - -
Cemetery - - - - -32,900
Minnesota Investment - - - - --
Monticello Community Center 485,000 - - - - 421,200
Total Special Revenue Funds 851,300 - 617,344 - - 454,100
Debt Service Funds
2011A G.O. Refunding Bonds - - - - - -
2014A G.O. Judgment Bonds 513,570 - - - - -
2015B G.O. Bonds 201,115 - - - - -
2016A G.O. Bonds 406,089 - - - - -
2017A G.O. Bonds 430,097 - - - - -
2018A G.O. Bonds 448,077 - - - - -
2019A G.O. Bonds 714,945 - - - - -
2020A G.O. Bonds 117,586 - - - - -
Total Debt Service Funds 2,831,479 - - - - -
Capital Project Funds
Capital Project 578,221 20,000 - - 2,100,000 -
Closed Bond Fund - - - - - -
Park & Pathway Dedication - - - - - -
Street Lighting Improvement - 90,000 - - - -
Street Construction - -- - - -
Total Capital Project Funds 578,221 110,000 - - 2,100,000 -
Enterprise Funds
Water - - - 2,000 -1,424,400
Sewage - - - - -2,695,212
Stormwater - - - - -381,000
Liquor - - - - --
Deputy Registrar - - - - -700,500
Fiber Optics - - - - -1,863,000
Total Enterprise Funds - - - 2,000 -7,064,112
Internal Service Funds
Facilities Maintenance - - - - -292,000
IT Services - - - - -244,500
Central Equipment - - - - -436,600
Benefit Accrual - - - - -16,000
Total Internal Service Funds - - - - -989,100
Total All Funds 11,430,000$ 366,500$ 617,344$ 422,300$ 2,504,000$ 9,472,612$
76
Revenue Classifications
Fines &Special Miscell-Sale of Debt Contributed Operating
Forfiets Assess aneous Goods Proceeds Capital Transfers Total
41,600$ 150$ 618,150$ -$ -$-$ -$ 9,875,000$
- - 202,356 - - - - 1,186,000
- - 100 - - - - 33,000
- - 5,000 - - - - 5,000
- - 4,800 - - - 325,000 1,236,000
- - 212,256 - - - 325,000 2,460,000
- - 1,000 - - - 200,000 201,000
- - 1,430 - - - - 515,000
- 22,720 1,165 - - - - 225,000
- 81,422 1,489 - - - - 489,000
- 42,577 1,326 - - - - 474,000
- -923 - - - - 449,000
- 14,322 733 - - - - 730,000
- 68,554 860 - - - - 187,000
- 229,595 8,926 - - - 200,000 3,270,000
- 54,755 40,024 - - - - 2,793,000
- 150,820 5,180 - - - - 156,000
- -47,000 - - - 1,094,000 1,141,000
- -10,000 - - - - 100,000
- -- - - - - -
- 205,575 102,204 - - - 1,094,000 4,190,000
- 38,000 55,600 - - 80,000 - 1,600,000
- -25,000 - - 199,788 200,000 3,120,000
- -7,000 - - 60,000 - 448,000
- -5,000 6,679,000 - - - 6,684,000
- -1,500 - - - - 702,000
- -2,000 - - - - 1,865,000
- 38,000 96,100 6,679,000 - 339,788 200,000 14,419,000
- - - - - - - 292,000
- - 3,500 - - - - 248,000
- - 3,400 - - - 560,000 1,000,000
- - 3,000 - - - - 19,000
- - 9,900 - - - 560,000 1,559,000
41,600$ 473,320$ 1,047,536$ 6,679,000$ -$339,788$ 2,379,000$ 35,773,000$
77
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 have an
impact going forward.
Expected to rise at the pace
of inflation. Routine capital
expenditures vary by year,
but are being delayed as long
as feasible due to the effects
of the COVID-19 pandemic.
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 repair and maintence
items and total capital
expenditures exceeding
$75,000 could be supported
by transfers from other
funds. Due to the COVID-19
pandemic, no CIP purchases
are planned for 2021.
Tax increment financing (TIF)
expenditures will vary
considerabley from year-to-
year in each district as
development occurs.
Large capital projects usually
receive funding from debt
issuance. The city usually
covers initial project costs
with reserves or other
sources and reimburses itself
with debt proceeds.
There are no major projects
planned for 2021.
Revenues
Property taxes provide nearly
75% 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
for 25 years that began in
The property tax levy is set at
$485K in 2021. User fees
should cover 85% on-going
expenditures. However, the
COVID-19 pandemic has
caused a significant strain on
the fund's main revenue
source - charges for services.
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 2021 levy is
$366,300.
Fallon Overpass will receive
some federal aid in 2021. 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.
2021: None 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 2022-2024.
Payments on these bonds will
be structured to take
advantage of the decline in
other tax supported debt.
78
Water Sewage Liquor Fiber Optics Central Equipment
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 $150,000.
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
$375,000.
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. A debt service
schedule is contained in
the Internal Service
section of this report. All
expenditures in this fund
are either for capital
equipment purchases or
debt service.
2021: $700k SCADA
systems.
2022: $1.2M Well 6.
2024: $4.5M water
treatment facility.
Sewer access fees are no
longer needed to support
debt service.
2021: $930k SCADA
systems.
2022: $750k Marvin Rd
liftstation
2023: $1.365M WWTP
solids handling
improvements & $1.8M
phase 2 WWTF
The fund generates
sufficient annual revenues
to support its needs.
2022: $100K for roof
repairs, point-of-sale
software, and coolers.
Operating revenues are
not quite adequate to
support non-routine
expenditures. However,
non-routine expenditures
are tied to development,
which is unpredicatble.
Reserves from recent
operating revenues have
been sufficient.
Anticipated future
expenditure by year:
2021: $910k; 2022:
$1.7M;2023:
$1.7M; 2024: $466k;
2025: $215k.
The CIP reflects ideal
timing for replacement of
equipment, but will be
adjusted as financing
allows.
User rates are high
enough to cover planned
expenditures for the next
five years. A rate study is
included in the 2021
budget to ensure rates will
be sufficient.
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. A rate study is
included in the 2021
budget to ensure rates will
be sufficient.
Sales have increased
steadly for the last five
years. 2020 was a record
year due to the COVID-19
pandemic, and 2021 is
expected to also show
solid growth. Going
forward, sales may level
out because of space
limitations.
Transfers from Liquor
Fund have declined and
have not been needed in
2019 or 2020 due to
operational changes in the
management of FiberNet.
The current agreement
with Arvig expires on June
30, 2021, and the city is
researching options for
the system going forward.
Rental revenues
(expenditures in other
funds ) will rise with
equipment purchases.
Therefore, revenue
sources in other funds
become the revenue
source for this internal
service fund. A transfer in
to close out the unused
Street Reconstruction
fund is budgeted in 2021.
No debt issues are
anticipated over next five
years.
The Minnesota Public
Facilities Authority
(MPFA) may provide
funding for the future
projects. Revenue bonds
may be sold as reserves
are depleted.
No debt issues are
anticipated over next five
years.
The 2014A Judgment
Bonds related to prior
activity in this fund is paid
through tax levy in the
debt service fund. No new
debt is planned for the
future.
The fund is expected to
become self-sustaining.
The 2014A Equipment
Bonds are paid out of this
fund. Future debt issues
may be needed to make
all the acquistions listed in
the CIP.
79
As part of the budget process, council and staff review service needs, growth trends, and capital
investment requirements. A long-range financial model is developed for the city’s four main
operating funds: General, Monticello Community Center, Water, and Sewage. This is done in
conjunction with the Capital Improvement Plan (CIP), which is a five- to 10-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, Liquor Fund, Deputy Registrar Fund, and Fiber Optic Fund are excluded from
long range financial plan. The Stormwater Fund is in its infancy, and a long range financial plan
is being developed The liquor store and DMV are largely 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.
Items impacting long range financial planning:
•Current financial position (fund balances)
•Debt burden
•Regulatory environment
•Condition of existing capital assets
•Growth trends, inflation, and aspirations
The city annually adopts a balanced budget for the General Fund. Consequently, the
revenues/sources line and the expenditures/uses line will overlap for the 2021 budget and for
future year projections. After 2021, 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 chart assumes the city will continue to
provide the same current levels of service.
$-
$2
$4
$6
$8
$10
$12
$14
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027MillionsGeneral Fund 2018-2027
Fund Balance Revenues/Sources Expenditures/Uses
80
Like the General Fund, the Monticello Community Center Fund normally adopts a balanced
budget. However, changes caused by the COVID-19 pandemic created budgetary challenges for
the fund, relying on transfers from the Liquor Fund to avoid a fund balance deficit. The
following chart assumes a modest return of patrons while providing the same current levels of
service, although some may be altered to meet current safety regulations.
The Water Fund is the city’s most self-sustained utility fund. The fund has no direct debt and
adequate reserves to cover almost any expenditure for major capital projects, with none
scheduled in the next couple years. The peak in 2016 expenditures reflect the $1 million in
water improvements as part of the 2016 Core Street Project. A new well is planned for 2022.
Debt and reserves will finance a treatment plant that is tentatively planned for 2024. A rate
study is budgeted for 2021 to ensure rates will continue to cover operations and most capital
improvements.
$-
$1
$2
$3
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027MillionsMonticello Community Center 2018-2027
Fund Balance Revenues/Sources Expenditures/Uses
$-
$1
$2
$3
$4
$5
$6
$7
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027MillionsWater Fund 2018-2027
Working Capital Revenues/Sources Expenditures/Uses
81
Unlike the Water Fund, the Sewage Fund represents funding challenges. Environmental
regulatory changes require large investments in the wastewater treatment plant. The city
incurred nearly $2 million in debt for the wastewater treatment plant phosphorous reduction
project and for replacement of two digester covers, both in 2016. Other debt supported
treatment plant improvements are planned for 2023 and 2023. Along with the water fund, a
rate study is budgeted for 2021 to ensure rates will continue to cover operations, most capital
improvements, and debt service.
$-
$1
$2
$3
$4
$5
$6
$7
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027MillionsSewage Fund 2018-2027
Working Capital Revenues/Sources Expenditures/Uses
82
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. In light of
changes to tax policy, state aid reductions for various purposes, state-imposed levy limits in prior
years, 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 73% of the General Fund’s revenue. This
overdependence is largely attributable to a healthy tax base, which includes a nuclear power
plant. In recent years, the city’s tax levy has been above inflation. The current council philosophy
seems to indicate a willingness to take advantage of the growth in the tax base. 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 terms of identifying all relevant funding sources to underwrite specific service expenditures,
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 that will lead to 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 spend policies. The five-year
capital improvement planning process is critical in achieving these results.
83
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 is in the process of developing and maintaining a financial model 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 will be 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 will continually update the proforma 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.
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 (FHLMC, FNMA, etc.), 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.
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. Staff has discussed the need to look
at optic imaging solutions. Imaging city records will enable 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, and adopting private sector customer service
business values in city operations.
84
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.
9.Continuously reviewing opportunities to form partnerships with other community
stakeholders and neighboring communities to share services and equipment, jointly 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 several joint powers
agreements in place on a variety of local and regional issues in public safety and public works
initiatives.
Recent steps taken to achieve long-term fiscal objectives:
The city began monthly billing of water and sewage services in 2017. Monthly bills allow the city
to bill customers for other services, such as residential garbage, recycling, and stormwater. Other
charges may be added in the future. There are benefits to the customers: lower monthly bills
instead of larger quarterly bills, a payment cycle in line with other customer bills, timely
consumption information, and earlier alert to service problems.
The Monticello Community Center Fund implemented a new chart of accounts in 2017. This
change breaks the fund’s accounts into major costs centers: administration, rentals, aquatics,
guest services and concessions, maintenance, and fitness programs.
In 2018, the city started billing all residential garbage customers with an individual service cart a
flat fee plus 9.75% tax per month. This charge replaces a $13.00 monthly fee that was mainly
paid by mobile home parks. In 2021, the garbage charge rises to $9.41, relaying the city’s cost
100% to the user. The recycling charge added in 2020 rises to $2.26 in 2020, allowing the city to
recoup 50% of the cost of service. The recycling rate is planned to match cost by 2023.
The city implemented a storm water utility charge in the middle of 2019. A storm water utility
fund was established for recording revenues and expenses, with full implementation occurring
in budget year 2020. Some General Fund expenditures, such as street sweeping and storm water
pond maintenance, will now be accounted for in the new fund.
85
STAFFING SUMMARY
Staffing, as measured by full-time equivalents, has been increasing slightly, mostly in response to
an increase in activity. For example, the part-time FTEs needed at the liquor store and DMV are
due to an increase in customers. Many employees perform across multiple activities/divisions and
funds. The budget includes a new Engineering Inspection Technician position, a restructured
Facilities Maintenance department (shifting away from Community Center), and an IT Technician
position (starting mid-year).
Adopted
Actual Actual Actual Budget
2018 2019 2020 2021
General Fund
City Administration 3.60 3.60 3.60 3.50
Finance 4.00 4.00 3.85 3.80
City Clerk 1.00 1.00 1.00 1.00
Human Resources 1.00 1.00 1.00 1.00
Planning & Zoning 1.30 1.30 1.30 1.30
Fire & Rescue 0.50 1.00 1.00 1.00
Building Inspections 4.00 4.00 4.00 4.20
Public Works Administration 1.80 1.80 1.80 1.90
Public Works Inspections 1.00 1.00 0.90 1.65
Streets & Alleys 4.80 4.80 4.85 4.70
Shop & Garage 1.50 1.50 1.50 0.80
Ice & Snow 1.65 1.65 1.60 2.10
Park Operations 8.00 8.00 9.00 9.15
Shade Tree 0.60 0.60 0.60 0.75
Total General Fund 34.75 35.25 36.00 36.85
Special Revenue Funds
Economic Development 1.20 1.20 1.20 1.20
Monticello Community Center 13.40 13.90 14.35 12.20
Total Special Revenue Funds 14.60 15.10 15.55 13.40
Enterprise Funds
Water 4.00 4.00 4.00 3.80
Sewage 4.00 4.00 4.00 3.75
Stormwater - - 1.00 1.10
Liquor 10.00 10.00 10.00 10.50
Deputy Registrar 6.20 6.20 6.20 7.20
Total Enterprise Funds 24.20 24.20 25.20 26.35
Internal Service Funds
Facilities Maintenance - - - 2.00
IT Services - - - 0.50
Total Internal Service Funds - - - 2.50
Total All Funds 73.55 74.55 76.75 79.10
NUMBER OF FULL-TIME EQUIVALENTS
86
CAPITAL EXPENDITURES & CAPITAL IMPROVEMENT PROGRAM
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. The Public Works Facility, A Glorious
Church stormwater pond expansion, and a water/sewage SCADA system update account for the bulk
of the 2021 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 2021-2025 Capital
Improvements Program (CIP). The Monticello CIP identifies capital and major noncapital
expenditures in a comprehensive plan for forecasting needed future resources 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.
WHAT IS A CAPITAL IMPROVEMENT PROGRAM?
A capital improvement program is a five-year plan 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.
While the program serves as a long-range plan, it is reviewed annually and revised based on
current circumstances and opportunities. Priorities may be changed due to grant opportunities
or circumstances that caused a more rapid deterioration of an asset. Projects may be revised for
significant costing variances.
WHAT ARE THE OBJECTIVES OF A CAPITAL IMPROVEMENT PROGRAM?
· To forecast public facilities and improvements in a timely and systematic manner while
providing an opportunity for citizens and interest groups to provide input.
· To strike a balance between needed public improvements and the present financial capability
of the city to provide for these improvements.
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· To anticipate and project financing needs in order to maximize available federal, state, and
county funds, and enhance and protect future bond ratings and bonding capacity.
· 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 estimate 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 the capital improvement effort.
WHAT IS THE CAPITAL IMPROVEMENT PROGRAM DEVELOPMENT PROCESS?
Assign Project Titles
Make the title descriptive of the work focusing on the problem to be solved at a location, rather
than titling based on the solution.
Group projects in a meaningful way by department. A project title of Boomerang Improvements
will not work if it includes everything from the kitchen sink replacement to the cart path
overlay. It is a judgment decision.
Formulate Project Descriptions
Include the target activities to be completed each year on the project. This should be 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.
_ Corrects a condition dangerous to public health or safety
_ Satisfies a legal obligation (law, regulation, court order, contract)
_ Alleviates an emergency service disruption or deficiency
_ Prevents irreparable damage to a valuable public facility
Priority II: Essential (SHOULD-DO)-Projects that address clearly demonstrated needs or
objectives.
_ Rehabilitates or replaces an obsolete public facility or attachment thereto
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_ Stimulates economic growth and private capital investment
_ Reduces future operating and maintenance costs
_ 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.
_ Provides a new or expanded level of service
_ Promotes intergovernmental cooperation
_ Reduces energy consumption
_ Enhances cultural or natural resources
Document Project Justifications
The following things should be considered:
· Reason the project is necessary
· Related projects (timing issues)
· Coordination efforts required with other agencies (timing issues)
· Mandates and deadlines for compliance
· Service impact (number of participants impacted)
· New fees that could be generated as a result of the completion of the project (community
center usage fees, program fees)
· Community goal references (refer to your budget document)
· 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 cost continues 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 HVAC unit resulting in an electricity savings.
· New project will always have some kind of 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
· Ranked list of unfunded needs
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HOW DOES THE CAPITAL IMPROVEMENT PROGRAM 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 Program. 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.
Most 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 70-mile street system. The city budgets $250,000 - $300,000 for chip
sealing every other year and $ 70,000 for crack sealing for more durable mill and overlay. These
operating and capital expenditures work together to prevent more expensive street
reconstruction projects.
Finally, the city annually budgets for replacement of water and sewage 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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Items with a (+) are additional equipment, incurring additional R&M. Items with a (-) are
replacement equipment with lower R&M in the near term. R&M expenses for roads include
estimates for snow removal, boulevard maintenance, street sweeping, crack sealing, and
striping. Listed amounts are for expenses in excess of those already being incurred. With no
impact on expenses, some are replaced due to obsolescence or aesthetics reasons. In reality,
some of these amounts may or may not be close to those actually realized.
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 public meetings, work sessions, and public hearings, and through
boards, 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.
Investment
Department - Operating Fund Amount Starting Year Amount Comment
Fire - General Fund
Squad vehicle 75,000$ 2021 11,000$ CE lease (+) and R&M (-)
Public Works - General Fund
One ton truck 65,000$ 2021 10,550$ CE lease (+) and R&M (-)
Box sander 23,000$ 2021 3,670$ CE lease (+) and R&M (-)
One ton truck with dump 80,000$ 2021 9,600$ CE lease (+) and R&M (-)
Hook truck with plow 278,000$ 2021 33,220$ CE lease (+) and R&M (-)
Wheel loader 245,000$ 2021 29,250$ CE lease (+) and R&M (-)
Sidewalk gap/ADA improvements 100,000$ 2022 1,000$ R&M
Fenning Avenue curb/landscaping 300,000$ 2022 3,000$ R&M
Recreation & Culture - General Fund
Tractor 49,000$ 2021 5,800$ CE lease (+) and R&M (-)
Skid loader 75,000$ 2021 9,200$ CE lease (+) and R&M (-)
Top dresser 20,000$ 2021 3,000$ CE lease (+) and R&M (-)
Fenning trail 300,000$ 2022 1,000$ R&M
East BCOL trail connection 50,000$ 2022 500$ R&M
Ellison Park restroom building 275,000$ 2022 300$ Utilities and R&M
CSAH 39 pathway 400,000$ 2022 1,250$ R&M
Public Works - Stormwater Fund
A Glorious Church pond expansion 475,000$ 2022 1,200$ R&M
Fenning Avenue Stormwater 100,000$ 2022 300$ R&M
Public Works - Water Fund
SCADA 700,000$ 2022 7,750$ R&M, software support
Public Works - Sewage Fund
SCADA 930,000$ 2022 8,325$ R&M, software support
DMV - Deputy Registrar Fund
Relocation/building renovation 125,000$ 2022 1,250$ Utilities and R&M
Impact on
Operating Expense
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HOW IS THE CAPITAL IMPROVEMENT PROGRAM FINANCED?
In analyzing the financial viability of the capital improvements in the 2021-2025 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 in 2013 for the purpose of creating 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, a hybrid of the fund has been established
for IT Services, which will also include IT-related equipment purchases.
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 to provide financing for capital asset
acquisitions.
Federal and state grants provide funding for various capital improvement projects. Currently, the
Fallon Avenue overpass is eligible for post-project federal funding of $2.1 million in 2021. Other
sources include local grants, donations, reserves, and other governmental units that share
boundaries.
Debt issuance is used to finance large 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.
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The below graphs provide a breakdown of expenditures and funding sources within the CIP:
$-
$5
$10
$15
$20
$25
$30
$35
2021 2022 2023 2024 2025MillionsCIP -Funding Sources for FY 2021 -2025
Capital Projects Fund Central Equipment Fund Enterprise Funds Other Funds
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Capital Improvement Plan
City of Monticello, Minnesota
FUNDING SOURCE SUMMARY
2021 thru 2025
TotalSource2021 2022 2023 2024 2025
Capital Equipment Fund 5,132,320910,000 1,675,648 1,866,357 465,851 214,464
Capital Project Fund 9,081,0001,315,000 3,825,000 450,000 366,000 3,125,000
Community Center Fund 535,000142,000 135,000 190,500 67,500
Debt Proceeds 33,790,00018,375,000 5,565,000 9,850,000
DMV Fund 125,000125,000
General Fund 1,748,000412,500 175,000 434,000 236,500 490,000
IT Services Fund 195,80035,600 42,800 39,000 39,200 39,200
Municipal Liquor Fund 195,00025,000 95,000 75,000
Parks & Pathways Fund 1,790,0001,025,000 435,000 100,000 20,000 210,000
Sewage Fund 4,541,0421,305,000 1,647,056 422,790 791,196 375,000
Stormwater Access Fund 3,015,000625,000 2,120,000 170,000 50,000 50,000
Stormwater Fund 675,00075,000 40,000 280,000 40,000 240,000
Street Lighting Fund 785,000100,000 400,000 75,000 135,000 75,000
Water Fund 2,650,000850,000 1,350,000 150,000 150,000 150,000
6,803,100 30,322,504 9,762,147 12,334,247 5,036,164 64,258,162GRAND TOTAL
Produced Using the Plan-It Capital Planning Software
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Capital Improvement Plan
City of Monticello, Minnesota
PROJECTS & FUNDING SOURCES BY DEPARTMENT
2021 2025thru
Total2021 2022 2023 2024 2025DepartmentProject # Priority
Community Center
535,000142,000 135,000 190,500 67,500Community Center Fund
535,000142,000 135,000 190,500 67,500Community Center Total
MCC-13-001 40,00040,000Movable Walls 3
MCC-13-003 20,00020,000City Council Diaz 3
MCC-13-004 100,000100,000Concession Counter Improvements 3
MCC-17-003 6,0006,000East/West Handicap Doors 1
MCC-18-003 16,00016,000Card Access Reader 3
MNC-13-006 20,00020,000Carpet and Terrazo Replace/Repair 2
MNC-13-010 20,00020,000Vanity and Partition Replacement 3
MNC-13-011 10,0005,000 2,500 2,500Facility Door Replacement 3
MNC-19-001 30,00030,000Climbing Wall Resurfacing 2
MNC-19-002 5,0005,000Childcare Countertop Replacement 3
STE-13-013 145,00085,000 60,000Recreation Equipment 2
STE-13-015 10,0005,000 5,000Tables3
STE-15-001 65,00065,000Survelliance Camera Upgrade 3
STE-18-005 8,0008,000Floor Scrubber 2
STE-20-001 20,00020,000Water Heater for Guard Kitchen 3
VEQ-13-045 20,00020,000Dishwasher3
535,000142,000 135,000 190,500 67,500Community Center Total
DMV - Deputy Registrar
125,000125,000DMV Fund
125,000125,000DMV - Deputy Registrar Total
DMV-20-001 125,000125,000DMV Relocation 2
125,000125,000DMV - Deputy Registrar Total
Fire & Rescue
STE-13-006 190,000190,000SCBA Packs 1
STE-16-002 83,0007,500 30,000 4,000 16,500 25,000Turnout Gear 1
VEQ-18-005 725,000725,000Engine 1 - Replacement 1
VEQ-18-006 120,000120,000Utility 1 - Replacement 1
VEQ-19-004 75,00075,000Squad 5 - Replacement 2
1,193,000272,500 755,000 124,000 16,500 25,000Fire & Rescue Total
Produced Using the Plan-It Capital Planning Software
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Total2021 2022 2023 2024 2025DepartmentProject # Priority
195,00075,000 120,000Capital Equipment Fund
190,000190,000Capital Project Fund
725,000725,000Debt Proceeds
83,0007,500 30,000 4,000 16,500 25,000General Fund
1,193,000272,500 755,000 124,000 16,500 25,000Fire & Rescue Total
IT Services
195,80035,600 42,800 39,000 39,200 39,200IT Services Fund
195,80035,600 42,800 39,000 39,200 39,200IT Services Total
STE-13-001 68,0005,600 15,600 15,600 15,600 15,600Personal Computers 2
STE-13-005 15,0003,000 3,000 3,000 3,000 3,000Laptops2
STE-13-007 40,0008,000 8,000 8,000 8,000 8,000GIS Hardware and Software 2
STE-13-008 21,8004,000 4,200 4,400 4,600 4,600Pavement Management Software 2
STE-20-002 36,00012,000 8,000 8,000 8,000Copiers3
VEQ-19-006 15,00015,000New Website 3
195,80035,600 42,800 39,000 39,200 39,200IT Services Total
Municipal Liquor
195,00025,000 95,000 75,000Municipal Liquor Fund
195,00025,000 95,000 75,000Municipal Liquor Total
LIQ-13-002 75,00075,000Parking Lot Improvements 1
LIQ-13-046 25,00025,000Liquor Store Coolers 1
LIQ-18-001 50,00050,000Roof1
LIQ-21-001 25,00025,000Breakroom Expansion 3
VEQ-13-046 20,00020,000Point of Sale Software 1
195,00025,000 95,000 75,000Municipal Liquor Total
Public Works
4,066,541691,000 1,372,414 1,549,196 400,908 53,023Capital Equipment Fund
4,100,000600,000 3,500,000Capital Project Fund
16,900,00014,500,000 2,400,000Debt Proceeds
25,066,5411,291,000 19,372,414 3,949,196 400,908 53,023Public Works Total
PWK-13-001 21,000,000600,000 18,000,000 2,400,000Public Works Facility 3
VEQ-13-013 65,00065,000One-Ton Truck 2
VEQ-13-014 23,00023,000Box Sander 2
VEQ-13-016 80,00080,000One Ton Truck with Dump 1
VEQ-13-022 278,000278,000Plow Truck 1
VEQ-14-001 245,000245,000Wheel Loader 3
VEQ-21-997 3,375,5411,372,414 1,549,196 400,908 53,023Fleet Replacement - PW 3
25,066,5411,291,000 19,372,414 3,949,196 400,908 53,023Public Works Total
Produced Using the Plan-It Capital Planning Software
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Total2021 2022 2023 2024 2025DepartmentProject # Priority
Recreation & Culture
870,779144,000 303,234 197,161 64,943 161,441Capital Equipment Fund
741,00016,000 725,000Capital Project Fund
440,00060,000 75,000 60,000 150,000 95,000General Fund
1,790,0001,025,000 435,000 100,000 20,000 210,000Parks & Pathways Fund
60,00060,000Street Lighting Fund
3,901,7791,229,000 813,234 357,161 310,943 1,191,441Recreation & Culture Total
MNC-14-007 250,00050,000 50,000 50,000 50,000 50,000Pathway Maintenance (Annual)2
PAR-13-003 16,00016,000Sunset Ponds Shelter 3
PAR-13-012 700,000700,000BCOL Ball Fields 3
PAR-13-014 60,00060,000CSAH 75 Pathway Lighting 3
PAR-15-004 300,000300,000Fenning Avenue Pathway Connection 3
PAR-17-002 100,000100,000West Bridge Playground Structure 3
PAR-17-004 100,000100,000Pioneer Park Playground Structure 3
PAR-17-007 25,00025,000Front Street Pier 3
PAR-20-001 35,00035,000Park Master Plan 3
PAR-20-002 50,00050,000East BCOL Trail Connection 3
PAR-20-004 25,00025,000Briarwood Road Improvements 2
PAR-20-006 425,000425,0004th St Park Improvements 2
PAR-20-007 100,000100,000Ellison Playground Equipment 3
PAR-20-008 275,000275,000Ellison Restrooms 3
PAR-21-001 20,00020,000BCOL Athletic Field Needs Study 3
PAR-21-004 10,00010,000Wayfinding Signage 3
PAR-21-005 40,00040,000Welcome Sign for Monticello 3
PAR-21-006 70,00070,000Columbarium-Riverside Cemetery 3
PAR-21-007 30,00010,000 10,000 10,000Boulevard Trees 3
PAR-21-009 400,000400,000CSAH 39 Pathway - River Mill Dr to Hart Blvd 3
VEQ-13-038 49,00049,000JD Tractor 3
VEQ-13-039 75,00075,000Skid Loader 3
VEQ-19-009 20,00020,000Top Dresser 3
VEQ-21-998 726,779303,234 197,161 64,943 161,441Fleet Replacement - Parks 3
3,901,7791,229,000 813,234 357,161 310,943 1,191,441Recreation & Culture Total
Stormwater\Drainage
SWD-13-001 635,00075,000 40,000 240,000 40,000 240,000Stormwater Pond Restoration 3
SWD-13-002 1,060,0001,060,000Stormwater Liftstation (TH 25 Pond)1
SWD-13-004 250,00050,000 50,000 50,000 50,000 50,000Boulevard Drainage Tile 3
SWD-17-001 450,000450,000Chelsea/Fallon Avenue Pond Expansion 3
SWD-20-002 560,000560,000Otter Creek - Pond D Construction 3
SWD-20-003 120,000120,000Otter Creek - Karlsburger Pond Outlet 2
SWD-20-004 475,000475,000A Glorious Church Pond Expansion 3
SWD-20-005 40,00040,000Chelsea Road Outlet Control - HB07 2
SWD-21-001 100,000100,000Fenning Avenue Stormwater 3
3,690,000700,000 2,160,000 450,000 90,000 290,000Stormwater\Drainage Total
Produced Using the Plan-It Capital Planning Software
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Total2021 2022 2023 2024 2025DepartmentProject # Priority
3,015,000625,000 2,120,000 170,000 50,000 50,000Stormwater Access Fund
675,00075,000 40,000 280,000 40,000 240,000Stormwater Fund
3,690,000700,000 2,160,000 450,000 90,000 290,000Stormwater\Drainage Total
Streets
4,050,000525,000 325,000 450,000 350,000 2,400,000Capital Project Fund
6,400,0003,150,000 3,250,000Debt Proceeds
1,225,000345,000 70,000 370,000 70,000 370,000General Fund
725,000100,000 400,000 75,000 75,000 75,000Street Lighting Fund
12,400,000970,000 3,945,000 895,000 3,745,000 2,845,000Streets Total
MNC-13-001 25,00025,000City Street Signs 1
MNC-14-001 850,000250,000 300,000 300,000Annual Chip Seal 1
MNC-20-001 350,00070,000 70,000 70,000 70,000 70,000Annual Crack Seal 1
STR-13-010 425,000100,000 100,000 75,000 75,000 75,000Street Light Improvements 2
STR-15-003 550,000550,000Elm Street Sidewalk - 3rd St Pedestrian Blinker 3
STR-15-004 500,000100,000 100,000 100,000 100,000 100,000Sidewalk Gap Improvement Project (TBD)2
STR-16-002 300,000300,000Flashing Yellow Arrow Signal 1
STR-17-002 650,000100,000 550,000Fallon Ave & Trail - Chelsea to School Bvld 3
STR-19-001 6,500,000100,000 3,150,000 3,250,000Pavement Management Program 1
STR-19-004 50,00025,000 25,000Broadway Corridor Parklets 3
STR-19-005 350,00050,000 300,000Chelsea/Cedar Roundabout 3
STR-20-001 200,000200,000School Blvd Pedestrian Improvements 1
STR-20-002 500,00050,000 450,000School Blvd/Cedar Roundabout 3
STR-20-003 500,00050,000 450,000School Blvd/Fallon Roundabout 3
STR-21-001 350,000350,000Broadway Sidewalk Improvements 3
STR-21-002 300,000300,000Fenning Ave Reconstruction - Curb/Landscaping 3
12,400,000970,000 3,945,000 895,000 3,745,000 2,845,000Streets Total
Utility - Sewage
5,265,0003,165,000 2,100,000Debt Proceeds
4,541,0421,305,000 1,647,056 422,790 791,196 375,000Sewage Fund
9,806,0421,305,000 1,647,056 3,587,790 2,891,196 375,000Utility - Sewage Total
MNC-17-005 110,000110,000Demo Obsolete WWTP Equipmnet 3
UTS-13-001 1,250,000250,000 250,000 250,000 250,000 250,000Annnual Sewage Trunk Improvements 1
UTS-13-002 750,000750,000Liftstation - Marvin Road 3
UTS-13-005 1,365,0001,365,000WWTP Solids Handling Improvements 1
UTS-13-006 1,800,0001,800,000WWTP Phase 2 Improvements 1
UTS-16-001 625,000125,000 125,000 125,000 125,000 125,000WWTP Repair & Maintenance Annual Upgrades 2
UTS-17-001 2,100,0002,100,000WWTP Headworks Improvements 2
UTS-20-001 100,000100,000Vactor Dump Station 1
VEQ-13-004 1,305,000930,000 375,000SCADA System - Sewage 2
VEQ-21-999 401,04237,056 47,790 316,196Fleet Replacement - Sewage 3
9,806,0421,305,000 1,647,056 3,587,790 2,891,196 375,000Utility - Sewage Total
Produced Using the Plan-It Capital Planning Software
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Total2021 2022 2023 2024 2025DepartmentProject # Priority
Utility - Water
4,500,0004,500,000Debt Proceeds
2,650,000850,000 1,350,000 150,000 150,000 150,000Water Fund
7,150,000850,000 1,350,000 150,000 4,650,000 150,000Utility - Water Total
UTW-13-001 750,000150,000 150,000 150,000 150,000 150,000Annual Water System Improvements 1
UTW-13-002 4,500,0004,500,000Water Treatment Facility 1
UTW-13-003 1,200,0001,200,000Well #6 1
VEQ-13-003 700,000700,000SCADA System - Water 2
7,150,000850,000 1,350,000 150,000 4,650,000 150,000Utility - Water Total
64,258,1626,803,100 30,322,504 9,762,147 12,334,247 5,036,164Grand Total
Produced Using the Plan-It Capital Planning Software
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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 include
property taxes, special assessments, transfers from enterprise funds, and transfers from capital
project 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 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 78%) by property taxes and the Monticello Community Center
(MCC) Fund is primarily supported by charges for services. The General Fund has other
underutilized revenue sources, and the MCC Fund can adjust its fee schedule and reduce costs.
Still, one negative consequence of using development fees for debt services is the city’s
reduced ability to finance water and sewer trunk improvements with money on hand. 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 Sewage Fund is the only enterprise fund with debt, the 2013B G.O. revenue bonds, and a
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. Transfers support principal
and interest payments in debt service funds where water and sewer development fees have
been deficient. This drain on resources means new debt will need to be issued for Sewage Fund
wastewater treatment plant upgrades and trunk improvements. According to an AE2S survey,
Monticello has some of the lowest water and sewage rates in the 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 75% of the
100
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. Again,
this is mitigated by the city’s low tax capacity rate and the lack of a levy limit.
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.
Anticipated Borrowing this Fiscal Year
None. Payment schedules are included with the detail of each debt service fund later in the report.
Bond Rating
The city’s general obligation bond rating was reviewed in August 2020 with the sale of the 2020A general
obligation bonds. Moody’s affirmed the city’s prior G.O. debt rating of A1, which can be described as
“strong, investment 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
g ra de
Lower
medium
grade
Market value (payable 2020)2,054,313,700$
Debt limit (3% of market value)61,629,411$
Total net debt applicable to limit (18,615,000)$
Legal debt margin 43,014,411$
Legal Debt Margin Calculation for Fiscal Year 2021
101
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 Service Payments: Annual debt service payments are as follows:
102
ENTERPRISE FUNDS
For Fiscal Year 2013
Adopted 2021
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 is used to account 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--current revenues
and other sources equal expenditures and other uses.
ISSUES
The General Fund’s largest revenue source is property taxes. In 2021 the General Fund’s
portion of the levy will grow by 5.6% as the city and HRA combined levy increases 5.8%. As in
previous years, the Public Works Department has the largest appropriation for 2021.
GENERAL FUND 2018 2019 2021 2021 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 6,613,634$ 6,667,831$ 6,788,000$ 6,788,000$ 7,169,000$ 5.6%
Franchise & Other Taxes 266,135 232,816 270,000 270,000 256,500 -5.0%
Licenses & Permits 504,464 603,925 407,200 407,200 420,300 3.2%
Intergovernmental Revenues 424,591 431,004 397,200 397,200 404,000 1.7%
Charges for Services 518,497 759,740 815,900 815,900 965,300 18.3%
Fines & Forfiets 45,350 40,054 40,400 40,400 41,600 3.0%
Special Assessments 206 802 200 200 150 -25.0%
Miscellaneous 331,916 526,164 184,100 544,100 618,150 235.8%
Operating Transfers - 25,000 - - - ---
TOTAL REVENUES 8,704,793$ 9,287,336$ 8,903,000$ 9,263,000$ 9,875,000$ 6.6%
GENERAL FUND 2018 2019 2021 2021 2021 %
EXPENDITURES BY DEPARTMENT ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
GENERAL GOVERNMENT
Mayor and Council 53,928$ 57,409$ 57,798$ 57,798$ 59,178$ 2.4%
City Administration 449,100 443,963 491,649 851,649 956,408 94.5%
City Clerk 130,948 121,197 150,400 150,400 128,960 -14.3%
Finance 430,924 456,902 491,791 491,791 458,156 -6.8%
Audit 40,531 45,940 44,000 44,000 44,000 0.0%
City Assessing 66,190 64,554 73,000 73,000 75,000 2.7%
Legal 27,967 41,837 37,000 37,000 35,000 -5.4%
Human Resources 126,581 142,812 129,407 129,407 139,054 7.5%
Planning & Zoning 239,045 315,091 331,630 331,630 268,867 -18.9%
City Hall 59,683 60,258 58,743 58,743 75,360 28.3%
Prairie Center Building 25,232 21,225 18,549 18,549 23,183 25.0%
TOTAL GENERAL GOVERNMENT 1,650,129$ 1,771,188$ 1,883,967$ 2,243,967$ 2,263,166$ 20.1%
Continued…
103
GENERAL FUND 2018 2019 2021 2021 2021 %
Continued…
PUBLIC SAFETY
Law Enforcement 1,362,411$ 1,455,727$ 1,532,621$ 1,532,621$ 1,595,638$ 4.1%
Fire & Rescue 435,068 477,941 457,772 457,772 502,257 9.7%
Fire Relief 132,874 123,640 130,000 130,000 135,000 3.8%
Building Inspections 351,511 324,072 443,860 443,860 466,357 5.1%
Emergency Management 12,332 8,253 5,000 5,000 6,000 20.0%
Animal Control 46,608 46,709 52,755 52,755 56,842 7.7%
National Guard 13,649 13,423 14,000 14,000 14,000 0.0%
TOTAL PUBLIC SAFETY 2,354,453$ 2,449,765$ 2,636,008$ 2,636,008$ 2,776,094$ 5.3%
EXPENDITURES BY DEPARTMENT ACTUAL BUDGET ACTUAL PROJECTED BUDGET CHANGE
PUBLIC WORKS
Public Works Administration 196,851$ 228,625$ 224,484$ 224,484$ 243,340$ 8.4%
Engineering 126,179 111,710 116,662 116,662 112,405 -3.6%
Public Works Inspections 83,560 90,047 111,035 111,035 169,632 52.8%
Streets & Alleys 891,117 920,384 1,061,105 1,061,105 1,294,694 22.0%
Ice & Snow 344,974 454,607 328,990 328,990 375,600 14.2%
Shop & Garage 168,049 178,063 214,727 214,727 256,932 19.7%
Stormwater 23,883 27,650 - - - ---
Street Lighting 244,478 210,948 250,500 250,500 237,000 -5.4%
Refuse Collection 615,586 610,944 686,776 686,776 722,936 5.3%
TOTAL PUBLIC WORKS 2,694,677$ 2,832,978$ 2,994,279$ 2,994,279$ 3,412,539$ 14.0%
TRANSIT
Bus 18,333 - - - - ---
TOTAL TRANSIT 18,333 - - - - ---
RECREATION AND CULTURE
Senior Center 103,226 102,169 107,452 107,452 106,363 -1.0%
Park Operations 916,335 925,482 1,078,841 1,078,841 1,061,609 -1.6%
Park Ballfields 21,063 19,836 27,400 27,400 27,400 0.0%
Public Arts 29,876 46,954 35,664 35,664 57,500 61.2%
Shade Tree 80,916 61,396 85,892 85,892 105,065 22.3%
Library 48,972 53,592 47,145 47,145 53,714 13.9%
TOTAL RECREATION AND CULTURE 1,200,388$ 1,209,429$ 1,382,394$ 1,382,394$ 1,411,651$ 2.1%
UNALLOCATED
Insurance 6,428 6,164 6,352 6,352 11,550 81.8%
TOTAL UNALLOCATED 6,428$ 6,164$ 6,352$ 6,352$ 11,550$ 81.8%
OTHER USES
Operating Tranfers 700,000$ 1,450,040$ -$ -$ -$ ---
TOTAL OTHER USES 700,000$ 1,450,040$ -$ -$ -$ ---
TOTAL EXPENDITURES 8,624,408$ 9,719,564$ 8,903,000$ 9,263,000$ 9,875,000$ 10.9%
FUND BALANCE - JANUARY 1 7,029,093$ 7,109,478$ 6,677,250$ 6,677,250$ 6,677,250$
Excess (Deficiency) of
Revenues over Expenditures 80,385 (432,228) - - -
FUND BALANCE - DECEMBER 31 7,109,478$ 6,677,250$ 6,677,250$ 6,677,250$ 6,677,250$
104
The previous table summarizes General Fund revenues by classifications and expenditures by
activities/divisions and departments. The table below summarizes both revenues and
expenditures by classifications.
BUDGET COMMENTARY:
Revenues
For 2021, budgeted revenues are estimated to increase by 10.9%. The General Fund portion of
the tax levy is budgeted to increase by 5.6%, which is less than the total (city & HRA) levy
increase of 5.8%. Property taxes account for 73% of General Fund revenues. The General Fund’s
allocation of franchise and other taxes will decrease 5% as updates to street lights decrease
electricity costs. The increase in charges for services reflects higher residential garbage and
recycling charges. Miscellaneous revenues increase due to electricity credits offset by solar
farm investment cost.
Expenditures
Expenditures are budgeted to increase 10.9%. All of the capital outlay amount reflects Capital
Equipment Fund purchases, which are charged back through lease payments. The 2021
personnel services budget includes a full step increase and a 2.5% market rate wage increase.
The 2018 and 2019 operating transfers were to the Capital Project Fund for future year capital
expenditures.
GENERAL FUND 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 6,613,634$ 6,667,831$ 6,788,000$ 6,788,000$ $7,169,000 5.6%
Franchise & Other Taxes 266,135 232,816 270,000 270,000 256,500 -5.0%
Licenses & Permits 504,464 603,925 407,200 407,200 420,300 3.2%
Intergovernmental Revenues 424,591 431,004 397,200 397,200 404,000 1.7%
Charges for Services 518,497 759,740 815,900 815,900 965,300 18.3%
Fines & Forfeits 45,350 40,054 40,400 40,400 41,600 3.0%
Special Assessments 206 802 200 200 150 -25.0%
Miscellaneous 331,916 526,164 184,100 544,100 618,150 235.8%
Operating Transfers - 25,000 - - - ---
TOTAL REVENUES 8,704,793$ 9,287,336$ 8,903,000$ 9,263,000$ 9,875,000$ 10.9%
EXPENDITURES
Personnel Services 3,161,509$ 3,324,061$ 3,522,314$ 3,522,314$ 3,651,591$ 3.7%
Supplies 700,957 671,712 751,000 751,000 817,700 8.9%
Other Services & Charges 3,812,142 3,974,851 4,298,886 4,658,886 4,969,109 15.6%
Capital Outlay 249,800 298,900 330,800 330,800 436,600 32.0%
Operating Transfers 700,000 1,450,040 - - - ---
TOTAL EXPENDITURES 8,624,408$ 9,719,564$ 8,903,000$ 9,263,000$ 9,875,000$ 10.9%
FUND BALANCE - JANUARY 1 7,029,093$ 7,109,478$ 6,677,250$ 6,677,250$ 6,677,250$
Excess (Deficiency) of
Revenues over Expenditures 80,385 (432,228) - - -
FUND BALANCE - DECEMBER 31 7,109,478$ 6,677,250$ 6,677,250$ 6,677,250$ 6,677,250$
105
MAYOR AND CITY COUNCIL
DEPARTMENT: General Government SUPERVISOR: City Clerk FUND #: 101 ACTIVITY #: 41110
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.Examine city facility needs to meet future city operations.
ISSUES:
1.Capitalize on the city’s uniqueness by developing a comprehensive vision statement
and setting achievable goals.
2.Succession planning of city staff.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The council’s budget remains consistent with previous years. The mayor earns $700 per month
and each councilmember earns $600 per month. Other services and charges are mainly
comprised of rental charges for the meeting room at the Monticello Community Center.
BUDGET:
Measurement 2018 2019 2020 2021
Council meetings 23 23 22 24
Special meetings/workshops 14 14 13 14
GENERAL FUND 2018 2019 2020 2020 2021 %
MAYOR & COUNCIL Actual Actual Budget Projected Budget Change
Personnel Services 40,224$ 41,046$ 41,548$ 41,548$ 41,428$ -0.3%
Supplies - - - - - ---
Other Services & Charges 13,704 16,363 16,250 16,250 17,750 9.2%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 53,928$ 57,409$ 57,798$ 57,798$ 59,178$ 2.4%
106
CITY ADMINISTRATION
DEPARTMENT: General Government SUPERVISOR: City Administrator FUND #: 101 ACTIVITY #: 41310
ACTIVITY SCOPE:
City administration provides the overall direction of the city, as determined by the council and
mayor. 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.Continue with proactive succession planning regarding key staffing roles within
the organization.
4.Provide friendly, knowledgeable customer service to the public.
5.Provide adequate and consistent hours of business throughout the year.
ISSUES:
1.Long-range comprehensive planning, including for development and traffic.
2.Leading and focusing council on policy matters.
3.Continuing to improve internal and external communication systems.
4.Management of Citizen Service Desk with continued growth of inquiries and need to
improve response times.
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Council meetings agendas 37 38 35 38
Records digitally converted 100% 100% 100% 100%
Ordinances processed 13 27 22 20
Council minutes approved 37 38 35 38
Newsletters published 2 2 2 2
Utility inserts published 8 8 4 8
Park inserts published 3 1 1 3
All other inserts published 13 12 11 12
Service desk data entry 625 641 775 675
107
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 2021 personnel services
budget includes a full step increase and a 2.5% market rate wage increase. Other services and
charges increase due to the cost of the city’s investments in a solar farm. The city is given credit
on its electric bill as a return on investment in the solar farm.
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
ADMINISTRATION Actual Actual Budget Projected Budget Change
Personnel Services 346,161$ 321,302$ 380,880$ 380,880$ 403,733$ 6.0%
Supplies 11,111 10,458 14,500 14,500 14,500 0.0%
Other Services & Charges 91,828 112,203 96,269 456,269 538,175 459.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 449,100$ 443,963$ 491,649$ 851,649$ 956,408$ 94.5%
108
CITY CLERK
DEPARTMENT: General Government SUPERVISOR: City Clerk FUND #: 101 ACTIVITY #: 41410
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. Recruit and train judges for future elections.
2. Upgrade election equipment.
3. Improve data storage practices with digital storage through Laserfiche.
ISSUES:
1. Storage space.
2. Laserfiche training.
3. Identify and organize decades of files.
4. Maintaining current, accurate information for all public sources.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
Elections are held in even-numbered years. 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. Other service and charges reflect increased IT
Services expenditures for the Laserfiche document management system. The 2021 personnel
services budget includes a full step increase and a 2.5% market rate wage increase.
Measurement 2018 2019 2020 2021
Voters, number of 7,112 0 7,110 0
Register voters, number of 7,112 7,237 8,734 8,734
Polling places 1 1 2 2
Election judges 38 0 35 0
Ordinances amendments 13 27 22 20
Council resolutions 100 95 99 90
109
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
CITY CLERK Actual Actual Budget Projected Budget Change
Personnel Services 103,793$ 105,809$ 115,208$ 115,208$ 113,873$ -1.2%
Supplies 2,132 701 1,500 1,500 1,000 -33.3%
Other Services & Charges 25,023 14,687 33,692 33,692 14,087 -58.2%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 130,948$ 121,197$ 150,400$ 150,400$ 128,960$ -14.3%
110
FINANCE
DEPARTMENT: General Government SUPERVISOR: Finance Director FUND #: 101 ACTIVITY #: 41520
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 accounting control. The preparation of the annual audited financial
report and annual budget document are also facilitated through finance.
OBJECTIVES:
1. Create a formal long-term financial management plan for the city.
2. Develop financial documents in a format to be eligible for review and award of the
Government Finance Officers Association’s (GFOA) award programs.
3. Provide meaningful and timely financial reports and information to council,
commissions, and other city departments.
4. Complete financial, payroll, and utility billing transactions.
ISSUES:
1. Complete implementation of software systems for financial, payroll, and utility billing
functions with integration of new processes for web-based applications, and
remote timecard entry.
2. Implement improved reporting procedures to inform council, commissions, and
departments.
3. Develop methods for simplifying data analysis for various stakeholders.
4. Work with other departments to find ways to reduce costs of city operations.
5. Construct a work environment that provides growth through learning, self-
determination through autonomy, and relatedness through the creation of
enduring work products.
6. Cross-training of finance team members in core functions (payroll, accounts payable,
utility billing, and accounts receivable).
111
MEASURABLE WORKLOAD DATA:
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
2021 personnel services budget includes a full step increase and a 2.5% market rate wage
increase. However, turnover provided for a decrease in overall wages. Other budget items are
expected to decrease as well.
BUDGET:
Measurement 2018 2019 2020 2021
Outcome/Effectiveness:
GFOA Budget Award Yes Yes Yes Yes
GFOA Certificate of
Achievement Yes Yes Yes Yes
GFOA Popular Annual
Financial Report Yes Yes Yes*Yes
Bond Rating A2 A1 A1 A1
Efficiency:
AP & ACHs per FTE (1.5)1,949 1,944 1,835 1,833
ACHs as % of total AP activity 43% 44% 45% 45%
Work Load:
AP checks, number of 1,668 1,622 1,526 1,500
AP ACHs, number of 1,255 1,294 1,227 1,250
W-2s 315 286 287 275
1099's 67 65 87 75
Journal entries 2,542 2,479 2,375* 2,400
*Not yet available. Value is an estimate.
GENERAL FUND 2018 2019 2020 2020 2021 %
FINANCE Actual Actual Budget Projected Budget Change
Personnel Services 353,185$ 388,984$ 409,533$ 409,533$ 387,010$ -5.5%
Supplies 3,054 1,567 2,800 2,800 2,500 -10.7%
Other Services & Charges 74,685 66,351 79,458 79,458 68,646 -13.6%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 430,924$ 456,902$ 491,791$ 491,791$ 458,156$ -6.8%
112
AUDIT
DEPARTMENT: General Government SUPERVISOR: Finance Director FUND #: 101 ACTIVITY #: 41540
ACTIVITY SCOPE:
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.Complete the financial audit in a timely fashion.
2.Continue to reduce the number of audit findings and adjustments.
ISSUES:
1.Comply with changing reporting requirements and auditing standards.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The budget for auditing consists entirely of the expenses associated with the required audit
process. In late 2007, a request for proposal (RFP) for audit services was sent to several firms.
The RFP guaranteed the cost for audit services for the years ended 2007 through 2009 and
resulted in a cost decrease from previous years. This contract was extended for the 2021 fiscal
year. The finance department has prepared the Comprehensive Annual Financial Report
internally since 2015.
BUDGET:
Measurement 2018 2019 2020 2021
Audit submittal date 6/14 5/22 5/18 5/18
Audit findings 0 1 0 0
Opinion Unmodified Unmodified Unmodified Unmodified
GFOA Award Yes Yes Yes Yes
GENERAL FUND 2018 2019 2020 2020 2021 %
AUDIT Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 40,531 45,940 44,000 44,000 44,000 0.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 40,531$ 45,940$ 44,000$ 44,000$ 44,000$ 0.0%
113
ASSESSING
DEPARTMENT: General Government SUPERVISOR: Finance Director FUND #: 101 ACTIVITY #: 41550
ACTIVITY SCOPE:
Property tax assessing requirements are provided through a contract with the Wright County
assessor. There are no plans to alter this activity.
OBJECTIVES:
1.Assess new and existing parcels within the city as required.
ISSUES:
1.Meet state requirements in appraising properties.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
Assessing services are provided by contract with Wright County. Estimated costs for
assessments are based on the number of existing and new parcels. The city paid $13.00 per
parcel for assessment services and $50 for each new permit with an estimated construction
value under $499,999 and $150 for values over $500,000 in 2020. Those rates have climbed
slightly each year.
BUDGET:
Measurement 2018 2019 2020 2021
New residential properties 64 58 59 60
New commercial properties 3 5 6 5
Tax exempt parcels 333 347 349 350
Taxable parcels assessed 5,028 4,689 4,714 4,750
GENERAL FUND 2018 2019 2020 2020 2021 %
ASSESSING Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 66,190 64,554 73,000 73,000 75,000 2.7%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 66,190$ 64,554$ 73,000$ 73,000$ 75,000$ 2.7%
114
LEGAL
DEPARTMENT: General Government SUPERVISOR: City Administrator FUND #: 101 ACTIVITY #: 41610
ACTIVITY SCOPE:
Private legal firms provide all the city’s legal services. Activities include issuance of legal
opinions; preparation 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.Continue to realize savings by contracting legal services.
ISSUES:
1.Rising costs associated with the need for existing and new legal services.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The city continues to realize savings from not having full-time counsel. Legal services provided
to FiberNet are charged to the Fiber Optics Fund.
BUDGET:
Measurement 2018 2019 2020 2021
Billed hours:
Administration 192.6 299.3 252.8 225.0
Code enforcement 20.4 11.8 6.4 15.0
Fiber optics 0.0 0.0 0.0 10.0
City Construction Projects 192.5 197.3 90.4 75.0
All other 21.2 83.1 70.9 100.0
Total 426.7 591.5 420.5 425.0
GENERAL FUND 2018 2019 2020 2020 2021 %
LEGAL Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 27,967 41,837 37,000 37,000 35,000 -5.4%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 27,967$ 41,837$ 37,000$ 37,000$ 35,000$ -5.4%
115
HUMAN RESOURCES
DEPARTMENT: General Government SUPERVISOR: City Administrator FUND #: 101 ACTIVITY #: 41800
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 major 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:
Measurement 2018 2019 2020 2021
Full-time positions 53 53 55 57
Part-time positions 120 153 116 153
Full-time positions filled 11 2 12 5
Other positions filled 104 87 51 51
Terminations processed 115 81 80 80
Job Postings 42 34 33 33
Application count - all city 656 546 408 408
Avg. number of employess 196 202 171 202
116
BUDGET COMMENTARY:
The 2021 budget reflects estimated costs for setting up training, providing city staff with benefit
and compensation information, and other expenses based on experience. The 2019 increase in
other services and charges represented expenditures on professional services to update the
city’s pay scale. The 2021 personnel services budget includes a full step increase and a 2.5%
market rate wage increase. Other budget items are expected to remain close to prior year
levels.
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
HUMAN RESOURCES Actual Actual Budget Projected Budget Change
Personnel Services 102,788$ 107,839$ 103,607$ 103,607$ 113,323$ 9.4%
Supplies 408 660 650 650 650 0.0%
Other Services & Charges 23,385 34,313 25,150 25,150 25,081 -0.3%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 126,581$ 142,812$ 129,407$ 129,407$ 139,054$ 7.5%
117
PLANNING, ZONING & COMMUNITY DEVELOPMENT
DEPARTMENT: General Government SUPERVISOR: Community Development Director FUND #: 101 ACTIVITY #: 41910
ACTIVITY SCOPE:
The Community Development and Planning & Zoning 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.
2. Completion of subdivision ordinance amendments consistent with the
Implementation Chart outlined by the Comprehensive Plan.
3. Support for downtown redevelopment and revitalization, including the
Embracing Downtown Monticello Project.
4. Involvement in regional planning and its impact on land use and growth
objectives.
5. Bertram Chain of Lakes master planning.
6. Continued implementation and training on the city's GIS.
7. Continued improvements of the city's development and planning process.
8. 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.
118
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Outcome/Effectiveness:
Grants awarded -1 1 1
Grant awards -$10,000 $5,000 See EDA
Administrative applications (total)8 6 7 6
processed within 5 working days 7 6 7 6
Site Plan reviews processed
within 14 working days 1 1 4 5
Change in Use forms 11 8 3 5
reviewed withing 5 working days 9 8 3 5
Sign Permit zoning reviews 30 34 17 20
processed within 5 working days 30 31 16 20
Land Use applications processed 33 28 66 40
within 60 working days 33 21 65 40
Reconciliations processed 21 12 20 20
Annexation petitions 1 2 2 1
Efficiency:
Applications processed per FTE 57 56 44 35
Work Load:
Planning Applications:
Variances 6 2 3 1
CUPs 10 4 7 5
PUD/Amendments to PUD 12 9 11 5
Interim Use permits --1 -
Comp Plan amendments 1 3 3 0
Map amendments 3 6 3 5
Non-city zoning text amendments -1 2 1
Plats/adminstrative subdivisions 3 9 5 2
Administrative permits 8 6 7 5
Site plan reviews 1 1 2 2
Appeals 1 0 0 0
Vacations -1 2 2
Sign permit application review 30 34 17 20
Change in Use review 11 8 3 5
Total applications 86 84 66 53
Planning reconciliations 21 12 25 25
Planning Commission meetings 13 12 18 15
BCOL Advisory Meetings --4 4
PARC Meetings (Report Prep)--3 3
EDA Meetings 14 14 21 18
IEDC Meetings 11 11 12 12
Grant applications -1 2 2
119
BUDGET COMMENTARY:
The 2021 personnel services budget includes a full step increase and a 2.5% market rate wage
increase. Other services and charges in 2019 and 2020 include amounts for a comprehensive
plan update. The Monti:2040 Comprehensive Plan was adopted in 2020.
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
PLANNING & ZONING Actual Actual Budget Projected Budget Change
Personnel Services 144,676$ 154,097$ 156,579$ 156,579$ 166,740$ 6.5%
Supplies 14 17 200 200 200 0.0%
Other Services & Charges 94,355 160,977 174,851 174,851 101,927 -41.7%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 239,045$ 315,091$ 331,630$ 331,630$ 268,867$ -18.9%
120
CITY HALL
DEPARTMENT: General Government SUPERVISOR: City Administrator FUND #: 101 ACTIVITY #: 41940
ACTIVITY SCOPE:
The activity for this department consists of maintenance and upkeep for the city hall suite.
OBJECTIVES:
1.Provide adequate and consistent hours of business throughout the year.
2.Maintain a clean, inviting facility to house meetings and staff.
ISSUES:
1.Depreciation of facility and work platforms.
2.Reconfiguring layout to accommodate workflow.
3.Timely maintenance.
4.Utility costs.
5.Building and office security.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
Items budgeted in the city hall activity are commonly shared among all departments operating
out of city hall. Personnel services costs were eliminated when custodial services started, and
utilities are the main expenditures in other services and charges.
BUDGET:
Measurement 2018 2019 2020 2021
Number of times cleaned 104 104 51 104
Utility expenses $24,064 $22,278 $18,327 $22,000
GENERAL FUND 2018 2019 2020 2020 2021 %
CITY HALL Actual Actual Budget Projected Budget Change
Personnel Services 8,139$ 7,969$ -$ -$ -$ ---
Supplies 3,596 139 2,000 2,000 2,000 0.0%
Other Services & Charges 47,948 52,150 56,743 56,743 73,360 29.3%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 59,683$ 60,258$ 58,743$ 58,743$ 75,360$ 28.3%
121
PRAIRIE CENTER BUILDING
DEPARTMENT: General Government SUPERVISOR: City Administrator FUND #: 101 ACTIVITY #: 41941
ACTIVITY SCOPE:
The city-owned Prairie Center Building leases space to FiberNet operations and the Community
Center. Further, the Wright County Sheriff's Department occupies non-rent paying space in the
building. This activity is for the operations of the facility.
OBJECTIVES:
1.To provide a well-maintained building.
2.Research viability as a space for the DMV to relocate.
ISSUES:
1.Maintain facility with current staff and available funds.
2.Tenant retention.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The Prairie Center Building was purchased in 2009 to provide FiberNet Monticello with office
space. FiberNet is now the building’s only year-round tenant. The 2021 budget reflects prior
year levels with an increase in building maintenance costs due to the creation of a centralized
and proactive Facilities Maintenance internal service fund.
BUDGET:
Measurement 2018 2019 2020 2021
Full-time Tenants 1 1 1 1
GENERAL FUND 2018 2019 2020 2020 2021 %
PRAIRIE CENTER BLDG Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies 352 631 750 750 750 0.0%
Other Services & Charges 24,880 20,594 17,799 17,799 22,433 26.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 25,232$ 21,225$ 18,549$ 18,549$ 23,183$ 25.0%
122
LAW ENFORCEMENT
DEPARTMENT: Public Safety SUPERVISOR: City Administrator FUND #: 101 ACTIVITY #: 42100
ACTIVITY SCOPE:
All law enforcement services are contracted with the Wright County Sheriff's Department. The
Sheriff’s Department maintains a local office in the Prairie Center building and uses space at the
new Fire Station. The Sheriff sets the hourly rate and the city contracts for the number of hours,
typically 17,000 to 19,000 hours annually. Contracted hours change in 4 hour-per-day
increments.
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 having our own police force.
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Outcome/Effectiveness:
Arrests 233 206 262 200
Arrests to crimes ratio 0.24 0.22 0.34 0.23
Efficiency:
Hours contracted 18,256 18,980 19,032 18,980
Calls per hour contracted 0.51 0.48 0.45 0.46
Costs per workload unit $140.85 $156.71 $174.34 $178.35
Work Load:
Life quality calls, number of 3,589 3,774 3,178 3,500
Traffic calls, number of 4,428 3,912 4,321 4,000
Vehicle crashes, number of 337 388 270 325
Crimes, number of 978 949 773 875
123
BUDGET COMMENTARY:
Law enforcement services are contracted in four-hour-per-day increments from the Wright
County Sheriff’s Department. 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. The leap years of 2012, 2016, and 2020 include one more day of coverage (52 hours in
2012 and 2020, and 48 hours in 2016).
BUDGET:
Hourly Hours
Year Rate Contracted
2012 $59.75 19,032
2013 $60.50 18,980
2014 $62.50 17,520
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 $81.75 18,980
GENERAL FUND 2018 2019 2020 2020 2021 %
LAW ENFORCEMENT Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 1,362,411 1,455,727 1,532,621 1,532,621 1,595,638 4.1%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 1,362,411$ 1,455,727$ 1,532,621$ 1,532,621$ 1,595,638$ 4.1%
124
FIRE & RESCUE
DEPARTMENT: Public Safety SUPERVISOR: City Administrator FUND #: 101 ACTIVITY #: 42200
ACTIVITY SCOPE:
The Fire Department responds to fire, rescue, hazardous materials, medical, and accident
incidents within the city and the surrounding townships. The department also provides fire
inspection services. Paid-on-call volunteers provide the department’s staffing.
OBJECTIVES:
1.Assemble a confined space entry team with personnel and equipment.
2.Improve response times.
ISSUES:
1.Training and retention of paid-on-call personnel.
BUDGET COMMENTARY:
The Fire Department is staffed with paid-on-call volunteers. The purchase of turn-out gear
contributed to the high cost of supplies in 2018. Grants and donations may offset some of these
expenditures. Capital outlay reflects the acquisition of a fire tender truck in 2014, a fire half-ton
truck in 2019, and a new chief squad vehicle in 2021 through the Central Equipment Fund.
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
FIRE Actual Actual Budget Projected Budget Change
Personnel Services 155,224$ 215,901$ 234,623$ 234,623$ 238,402$ 1.6%
Supplies 147,645 99,504 61,800 61,800 62,300 0.8%
Other Services & Charges 90,899 112,936 111,749 111,749 138,855 24.3%
Capital Outlay 41,300 49,600 49,600 49,600 62,700 26.4%
TOTAL EXPENDITURES 435,068$ 477,941$ 457,772$ 457,772$ 502,257$ 9.7%
125
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Outcome/Effectiveness:
Respondents to fire calls:
City 3,050 3,152 2,433 3,005
Monticello Township 1,104 1,024 937 1,173
Silver Creek Township 585 698 434 532
Mutual Aid 292 399 636 423
Drills & Maintenance 3,295 2,628 2,053 2,638
Total 8,326 7,901 6,493 7,771
Efficiency:
Average respondents per call
City 16 16 14 15
Monticello Township 23 16 17 20
Silver Creek Township 22 23 18 20
Mutual Aid 37 29 27 28
Drills & Maintenance 57 34 35 43
Total 25 20 20 22
Work Load:
Number of fire calls:
City 195 200 168 195
Monticello Township 47 63 56 59
Silver Creek Township 27 31 24 27
Mutual Aid 8 14 24 15
Drills & Maintenance 58 78 59 61
Total 335 386 331 357
Firefighters, number of 26 27 30 30
126
FIRE RELIEF
DEPARTMENT: Public Safety SUPERVISOR: Finance Director FUND #: 101 ACTIVITY #: 42202
ACTIVITY SCOPE:
Providing a retirement benefit to paid-on-call volunteers, the fire relief activity is specifically
designed to track the city’s contribution 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 COMMENTARY:
The fire relief budget is basically 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.
BUDGET:
Measurement 2018 2019 2020 2021
Pension assets 1,236,914$ 1,209,943$ 1,472,948$ 1,450,000$
Pension liabilities 1,322,555$ 981,203$ 967,833$ 1,076,860$
Assets-liabilities ratio 0.94 1.23 1.52 1.35
Pension per service year $4,200 $4,200 $4,200 $4,500
Fire state aid $130,874 $123,640 $131,638 $135,000
State aid per employee $5,034 $4,579 $4,539 $4,500
Active firefighters 26 27 29 30
Deferred firefighters 5 6 5 5
GENERAL FUND 2018 2019 2020 2020 2021 %
FIRE RELIEF Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 132,874 123,640 130,000 130,000 135,000 3.8%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 132,874$ 123,640$ 130,000$ 130,000$ 135,000$ 3.8%
127
BUILDING INSPECTIONS
DEPARTMENT: Public Safety SUPERVISOR: Community Development Director FUND #: 101 ACTIVITY #: 42400
ACTIVITY SCOPE:
The Building Department inspects all new and remodeled construction within the city by a state
certified building inspector. The department initiates all building permits and oversees the
enforcement of all public nuisance and ordinance issues.
OBJECTIVES:
1. Continue implementation of the rental licensing program.
2. Continue implementation of zoning ordinance changes.
3. Continue sign ordinance update.
4. Implement yearly contractor, realtor, and rental property owner workshops.
5. Continue public relations contact. Improve city's public perception image.
6. Continue implementation of the building codes.
ISSUES:
1. Managing and prioritizing department workloads.
2. Meeting the residential and commercial growth challenges as a regional
center.
3. Keeping up with biennial rental license inspections.
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Outcome/Effectiveness:
Value of permits issued 33,125,788$ 45,723,446$ 32,453,366$ 45,000,000$
Value of permits per FTE 9,464,511$ 15,241,149$ 10,817,789$ 15,000,000$
Efficiency:
Departmental FTEs 3.5 3 3 3
Rental inspections per FTE (2)787 773 808 845
Permi ts per FTE 245 279 319 297
Work Load:
Building permits issued 856 837 957 890
Nuisance notices issued 116 116 71 125
Rental units, number of 1,573 1,545 1,616 1,690
128
BUDGET COMMENTARY:
The 2021 personnel services budget includes a full step increase and a 2.5% market rate wage
increase. One budgeted building inspector position has been vacant since 2018 while staff
evaluates departmental needs with the unpredictable workload of building inspections. The
other budget items are expected to remain close to prior year levels.
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
BUILDING INSPECTIONS Actual Actual Budget Projected Budget Change
Personnel Services 297,047$ 284,425$ 409,594$ 409,594$ 436,572$ 6.6%
Supplies 3,856 4,968 6,800 6,800 5,500 -19.1%
Other Services & Charges 46,408 30,479 23,266 23,266 24,285 4.4%
Capital Outlay 4,200 4,200 4,200 4,200 - -100.0%
TOTAL EXPENDITURES 351,511$ 324,072$ 443,860$ 443,860$ 466,357$ 5.1%
129
EMERGENCY MANAGEMENT
DEPARTMENT: Public Safety SUPERVISOR: Emergency Management Coordinator FUND #: 101 ACTIVITY #: 42500
ACTIVITY SCOPE:
The emergency management department provides constant defense coverage for all weather
and power plant related emergency situations within the city.
OBJECTIVES:
1.Implement 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 COMMENTARY:
The 2021 budget is based on the 2020 budget with a shift between staff time and other services
and charges. Much of this activity's responsibilities had been transferred to Wright County.
However, the city is an active participant of the emergency management team, and, with the
new Fire Marshal/Emergency Management Coordinator position added in 2018, this budget
unit will continue to see more activity going forward.
BUDGET:
Measurement 2018 2019 2020 2021
Data under development
GENERAL FUND 2018 2019 2020 2020 2021 %
EMERGENCY MANAGEMENT Actual Actual Budget Projected Budget Change
Personnel Services 440$ 3,068$ 1,612$ 1,612$ 3,224$ 100.0%
Supplies 9,942 1,286 100 100 100 0.0%
Other Services & Charges 1,950 3,899 3,288 3,288 2,676 -18.6%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 12,332$ 8,253$ 5,000$ 5,000$ 6,000$ 20.0%
130
ANIMAL CONTROL
DEPARTMENT: Public Safety SUPERVISOR: City Clerk FUND #: 101 ACTIVITY #: 42700
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 issues within the city and surrounding communities in a timely
and courteous manner.
2.Continue to improve animal control response time.
3.Continue to improve 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 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 revenue.
Measurement 2018 2019 2020 2021
Stray animal reports 496 476 488 500
Barking dog reports 190 175 181 175
Lost/found reports 1,670 1,580 1,613 1,600
Feral cat trapping 261 266 282 250
Unsanitary condition reports 201 189 193 190
Abuse/neglect reports 171 163 176 170
Impounds 556 487 501 500
Dog bite reports 78 76 73 80
Animal control fees $46,497 $43,320 $41,863 $50,600
131
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
ANIMAL CONTROL Actual Actual Budget Projected Budget Change
Personnel Services -$ 149$ -$ -$ -$ ---
Supplies 469 1,080 3,300 3,300 3,000 -9.1%
Other Services & Charges 46,139 45,480 49,455 49,455 53,842 8.9%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 46,608$ 46,709$ 52,755$ 52,755$ 56,842$ 7.7%
132
NATIONAL GUARD
DEPARTMENT: Public Safety SUPERVISOR: Project Coordinator FUND #: 101 ACTIVITY #: 42800
ACTIVITY SCOPE:
The National Guard 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. The Guard provides no direct services to the city.
OBJECTIVES:
1.To maintain a clean, modern facility for use by the National Guard.
ISSUES:
1.None.
MEASURABLE WORKLOAD DATA:
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.
BUDGET:
Measurement 2018 2019 2020 2021
Not Applicable
GENERAL FUND 2018 2019 2020 2020 2021 %
NATIONAL GUARD Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 13,649 13,423 14,000 14,000 14,000 0.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 13,649$ 13,423$ 14,000$ 14,000$ 14,000$ 0.0%
133
PUBLIC WORKS ADMINISTRATION
DEPARTMENT: Public Works SUPERVISOR: Public Works Director FUND #: 101 ACTIVITY #: 43110
ACTIVITY SCOPE:
The public works (PW) administration activity oversees the daily operations of the street, parks,
water, sewer, wastewater treatment plant, stormwater, and inspection activities. PW
administration also manages all large city projects and implements all changes to PW
operations and policy.
OBJECTIVES:
1.Continue the implementation of a bio-solids management system.
2.Implement the major street lighting project plan.
3.Continue implementing the wellhead protection plan.
4.Manage the development of a new public works facility and expansion of the
wastewater treatment plant.
5.Determine location for future wells, utilizing information gathered from
various sources including grants.
6.Develop a program to lease antenna space on elevated water towers, thus
generating a new revenue source.
7.Implement new SCADA system as budgeted in the water and sewage funds.
ISSUES:
1.Balance the public works department needs with available funds.
2.Manage city's water and wastewater treatment systems.
3.Implement a capital improvement program for city infrastructure.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The 2021 personnel services budget includes a full step increase and a 2.5% market rate wage
increase. Personnel services also included the 2018 re-instatement of a public works
director/engineering position. The director position is spread over three budgets: General
Fund - 60%, Sewage Fund – 20%, and Water Fund 20%. While other budget items may have
large percentage changes, in dollar terms they are relatively insignificant.
Measurement 2018 2019 2020 2021
Budget units 14 17 17 17
Employees supervised - FT 20 20 21 21
134
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
PW - ADMINISTRATION Actual Actual Budget Projected Budget Change
Personnel Services 170,517$ 205,853$ 188,155$ 188,155$ 204,379$ 8.6%
Supplies 5,059 2,957 6,000 6,000 6,000 0.0%
Other Services & Charges 21,275 19,815 30,329 30,329 32,961 8.7%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 196,851$ 228,625$ 224,484$ 224,484$ 243,340$ 8.4%
135
ENGINEERING
DEPARTMENT: Public Works SUPERVISOR: City Engineer FUND #: 101 ACTIVITY #: 43111
ACTIVITY SCOPE:
Engineering assists with 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. In addition,
engineering responds to residents with issues related to storm water drainage and/or
pedestrian, bicycle and vehicular traffic, and reviews. Engineering updates and supports the
city's General Specifications and Standard Detail Plates for Street and Utility Construction and
the Plan Requirements and Design Guidelines. Engineering also issues driveway, grading, and
right-of-way permits.
OBJECTIVES:
1.Improve ability to assist other departments with CADD and GIS related requests.
2.Continue to administer and maintain the city's SWPPP.
3.Continue to implement and improve the city's GIS.
4.Continue to educate the public on purposes and practices associated with
conservation and drainage easements and storm water ponds.
5.Create a one-stop shop for city driveway, grading, and right-of-way permits.
6.Continue to develop an in-house Pavement Management Program.
7.Review development plans and agreements.
8.Continue to work towards improving transportation system and collaborate with
MNDOT and Wright County.
9.Prepare capital infrastructure planning and budgeting.
10.Work with other departments on public improvements and development plans.
11.Apply for grants and track funding for improvement projects.
ISSUES:
1.Increasing restrictions by Minnesota Pollution Control Agency (MPCA) for storm water
runoff.
2.Lack of public knowledge regarding purposes and practices associated with
conservation and drainage easements and storm water ponds.
3.Increasing phosphorus restrictions by MPCA for wastewater effluent.
4.Reduction in available federal and state funding for transportation improvements.
136
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The engineering activity predominantly consists of engineering and other professional service
fees. These expenditures consist of both reimbursable and non-reimbursable expenditures. The
2021 budget provides for continued improvements and development of the city's GIS system
and reduces reliance on consulting services with the re-instatement of the City Engineer
position in 2018.
BUDGET:
Measurement 2018 2019 2020 2021
Service requests 70 72 90 90
On-line service requests 17 19 26 25
Active improvement projects 10 12 14 14
Driveway permits issued 7 18 8 8
Right-of-way permits issued 86 99 88 100
Development applications 8 9 6 8
Grading permits issued 5 3 4 5
GENERAL FUND 2018 2019 2020 2020 2021 %
PW - ENGINEERING Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies 452 180 500 500 3,000 500.0%
Other Services & Charges 125,727 111,530 116,162 116,162 109,405 -5.8%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 126,179$ 111,710$ 116,662$ 116,662$ 112,405$ -3.6%
137
INSPECTIONS
DEPARTMENT: Public Works SUPERVISOR: City Engineer FUND #: 101 ACTIVITY #: 43115
ACTIVITY SCOPE:
The public works inspection activity is responsible to design and inspect city infrastructure
projects, and to review and approve right-of-way excavation/obstruction permit applications.
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.Improve staff use of the city's GIS system through training.
2.Maintain certifications and attend appropriate classes and workshops for inspections.
3.Provide support for the engineering activity.
4.Improve communication between public works, engineering, and inspection
activities.
5.Improve knowledge, skills, and ability in using CarteGraph software for
development of an in-house Pavement Management and Sign Program.
6.Improve knowledge, skills, and ability in using GIS software for assisting other
departments with their mapping needs.
7.Assist other city departments in acquiring utility information not readily available
from other sources, including GIS.
8.Assist with design and implementation of solutions to drainage issues.
9.Complete cost estimates and design for small improvement projects.
10.Complete cost estimates for budgeting purposes for upcoming improvement projects.
11.Complete inspections and documentation for city’s SWPPP.
ISSUES:
1.Workload is unevenly distributed throughout the year.
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
NPDES Inspections 252 370 327 300
Outfall Inspections 1 1 2 6
Stormwater Inspections 47 49 50 50
Pond Inspections 37 1 0 25
Inspection revenue $14,300 $12,788 $13,695 $15,125
Inspection hours billed 130 116 125 125
138
BUDGET COMMENTARY:
The 2021 personnel services budget includes a full step increase and a 2.5% market rate wage
increase. Personnel services also reflects the shift of the Inspection Engineer position to a
Project Engineer position and the addition of an Engineering Technician position. The other
increases reflect increased needs with the change in staffing in the department.
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
PW - INSPECTIONS Actual Actual Budget Projected Budget Change
Personnel Services 75,303$ 83,488$ 98,283$ 98,283$ 147,970$ 50.6%
Supplies 972 463 4,000 4,000 9,000 125.0%
Other Services & Charges 7,285 6,096 8,752 8,752 12,662 44.7%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 83,560$ 90,047$ 111,035$ 111,035$ 169,632$ 52.8%
139
STREETS, ALLEYS & PARKING LOTS
DEPARTMENT: Public Works SUPERVISOR: Street Superintendent FUND #: 101 ACTIVITY #: 43120
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.Continue street reconstruction of older road surfaces by evaluating road wear.
2.Increase street chip seal coating projects.
3.Maintain and update equipment and vehicles.
4.Help maintain and use City GIS system.
5.Continue street crack sealing program.
ISSUES:
1.Educating the public on what the boulevards are to be used for.
2.Increased costs of fuel and street products.
3.Educating the public on the value of good maintenance programs for our
infrastructure.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The 2021 personnel services budget includes a full step increase and a 2.5% market rate wage
increase. A mild spring caused an increase in staffing costs as less time was allocated to plowing
streets. Increases in capital outlay reflects purchases in the Central Equipment Fund for
equipment leased to the streets department. Other budget items are expected to increase due
to a shift to a higher focus on preventative repairs and maintenance. The difference between
budget and actual can vary widely because the seasonal nature of some departmental
expenditures.
Measurement 2018 2019 2020 2021
Pounds of crack sealer 46,868 47,176 44,456 47,000
Sq. yards of chip sealing 102,487 76,655 103,000 95,000
Miles of streets 70.0 70.0 70.0 70.0
Tons of black top patching 164 492 443 450
140
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
PW - STREETS & ALLEYS Actual Actual Budget Projected Budget Change
Personnel Services 393,134$ 385,000$ 446,633$ 446,633$ 418,025$ -6.4%
Supplies 212,484 196,258 194,600 194,600 244,100 25.4%
Other Services & Charges 180,999 201,826 256,272 256,272 385,469 50.4%
Capital Outlay 104,500 137,300 163,600 163,600 247,100 51.0%
TOTAL EXPENDITURES 891,117$ 920,384$ 1,061,105$ 1,061,105$ 1,294,694$ 22.0%
141
ICE & SNOW REMOVAL
DEPARTMENT: Public Works SUPERVISOR: Street Superintendent FUND #: 101 ACTIVITY #: 43125
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, budget, personnel, and environmental
concerns.
OBJECTIVES:
1.Maintain and update equipment and vehicles in a timely manner.
2.Learn ways to effectively use the city's GIS system.
ISSUES:
1.Staffing and budgeting for unpredictable circumstances.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The 2021 personnel services budget includes a full step increase and a 2.5% market rate wage
increase. Weather variability greatly impacts budget-to-actual comparisons. As noted in the
Streets and Alleys department, the spring was mild leading to a lower need for plowing.
BUDGET:
Measurement 2018 2019 2020 2021
Inches of snow 72 62 29 57
Plowing events, number of 15 20 22 15
Tons of salt used 585 752 730 900
Tons of sand used 329 432 400 400
GENERAL FUND 2018 2019 2020 2020 2021 %
PW - ICE & SNOW Actual Actual Budget Projected Budget Change
Personnel Services 242,726$ 334,514$ 172,503$ 172,503$ 218,101$ 26.4%
Supplies 96,318 114,503 151,200 151,200 150,200 -0.7%
Other Services & Charges 5,930 5,590 5,287 5,287 7,299 38.1%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 344,974$ 454,607$ 328,990$ 328,990$ 375,600$ 14.2%
142
SHOP & GARAGE
DEPARTMENT: Public Works SUPERVISOR: Street Superintendent FUND #: 101 ACTIVITY #: 43127
ACTIVITY SCOPE:
Shop & Garage maintains all city vehicles and equipment for the streets, ice & snow, parks,
water, and sewage activities in a safe and efficient manner.
OBJECTIVES:
1.Maintain equipment and vehicles to maximize efficiencies and safety.
2.Update equipment and vehicles.
ISSUES:
1.Aging equipment.
2.Increased safety regulation for equipment and vehicles.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The 2021 personnel services budget includes a full step increase and a 2.5% market rate wage
increase. However, staff turnover allows for a decrease in wages in 2021. Other budget items
are expected to increase to ensure proper maintenance is performed proactively
Measurement 2018 2019 2020 2021
Service orders 92 91 87 95
Service order hours 396 370 270 375
Hours per service order 4.3 4.1 3.1 3.9
Total service order costs $20,017 $23,797 $8,438 $25,000
Service cost per order $217.58 $261.51 $96.99 $263.16
Repair orders 85 70 62 75
Repair hours 455 413 303 425
Hours per repair order 5.4 5.9 4.9 5.7
Total repair order costs $35,493 $46,532 $30,267 $48,000
Repair costs per order $417.56 $664.74 $488.18 $640.00
143
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
PW - SHOP & GARAGE Actual Actual Budget Projected Budget Change
Personnel Services 98,444$ 98,213$ 112,049$ 112,049$ 106,115$ -5.3%
Supplies 24,875 31,644 45,100 45,100 65,500 45.2%
Other Services & Charges 44,730 48,206 57,578 57,578 85,317 48.2%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 168,049$ 178,063$ 214,727$ 214,727$ 256,932$ 19.7%
144
STORMWATER
DEPARTMENT: Public Works SUPERVISOR: Public Works Director FUND #: 101 ACTIVITY #: 43130
ACTIVITY SCOPE:
Stormwater is responsible for expenditures related to the maintenance of the city's stormwater
system. This activity included inspecting, cleaning, and repairing all stormwater trunk lines,
ditches, and ponds. The city created a Stormwater enterprise fund in 2019 when it established
a stormwater utility fee. That fund will absorb the operations of this department beginning in
2020.
OBJECTIVES:
1.None.
ISSUES:
1.None.
MEASURABLE WORKLOAD DATA:
See the Stormwater enterprise Fund.
BUDGET COMMENTARY:
See the Stormwater enterprise Fund.
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
PW - STORMWATER Actual Actual Budget Projected Budget Change
Personnel Services 21,171$ 17,026$ -$ -$ -$ ---
Supplies 1,081 8,012 - - - ---
Other Services & Charges 1,631 2,612 - - - ---
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 23,883$ 27,650$ -$ -$ -$ ---
145
STREET LIGHTING
DEPARTMENT: Public Works SUPERVISOR: Street Superintendent FUND #: 101 ACTIVITY #: 43160
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.Replace inefficient lights 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.
3.Lack of assistance from Wright County and MNDOT.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
Electricity for the streetlights is the largest expenditure at $170,000. Other services and charges
include $35,000 for repairs and maintenance of traffic signals. In 2018, the city assumed the
maintenance on those streetlights previously maintained by Wright-Hennepin Electric under
service agreements.
BUDGET:
Measurement 2018 2019 2020 2021
Street lights maintained 937 973 973 973
Street lights maintained include those owned by the city and Xcel Energy.
GENERAL FUND 2018 2019 2020 2020 2021 %
PW - STREET LIGHTING Actual Actual Budget Projected Budget Change
Personnel Services 5,338$ 5,815$ -$ -$ -$ ---
Supplies 14,191 18,698 20,000 20,000 20,000 0.0%
Other Services & Charges 224,949 186,435 230,500 230,500 217,000 -5.9%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 244,478$ 210,948$ 250,500$ 250,500$ 237,000$ -5.4%
146
REFUSE COLLECTION
DEPARTMENT: Public Works SUPERVISOR: Refuse Collection FUND #: 101 ACTIVITY #: 43230
ACTIVITY SCOPE:
The city contracts with a private hauler for residential refuse and recycling collection services.
OBJECTIVES:
1.Research expanding city hauler’s contracted service prices to business and determine
the percentage of participation to achieve a desirable rate.
ISSUES:
1.Wear and tear on city streets.
2.Increasing recycling efficiency and effectiveness.
MEASURABLE WORKLOAD DATA:
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 next five years when it expires on May 31,
2025. The contract increases annually with inflation and the addition of customers.
BUDGET:
Measurement 2018 2019 2020 2021
Residential refuse collections 52 52 52 52
Residential recycling collections 26 26 26 26
Residential container base 3,892 3,945 3,992 4,025
Additional containers 601 609 627 630
Recycling containers 4,483 4,534 4,581 4,600
GENERAL FUND 2018 2019 2020 2020 2021 %
REFUSE COLLECTION Actual Actual Budget Projected Budget Change
Personnel Services 390$ 195$ 576$ 576$ 576$ 0.0%
Supplies - - - - - ---
Other Services & Charges 615,196 610,749 686,200 686,200 722,360 5.3%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 615,586$ 610,944$ 686,776$ 686,776$ 722,936$ 5.3%
147
SENIOR CENTER
DEPARTMENT: Recreation and Culture SUPERVISOR: City Administrator FUND #: 101 ACTIVITY #: 45175
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.Provide recreational activities to improve mental and physical health.
3.Engage senior citizen participation in other community center activities.
4.Encourage greater social participation by offering discounted lunches.
ISSUES:
1.Decline in revenue from sources other than the city.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The senior center rents space within the community center complex. The city maintains and
insures the senior center. Additionally, the city gives an annual contribution to the group
managing the senior center. The 2021 adopted contribution is $65,000, which is $1,700 greater
than 2020.
Measurement 2018 2019 2020 2021
Outcomes/Effectiveness
Volunteers hours 8,266 8,923 3,511 4,200
Noon meals served 3,378 3,609 919 1,200
Work Load:
Unduplicated participants 2,509 2,563 1,579 1,700
Duplicated participants 20,171 22,973 8,072 9,500
Received phone calls 4,456 4,400 2,748 3,800
Activities offered 136 134 89 95
148
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
SENIOR CENTER Actual Actual Budget Projected Budget Change
Personnel Services 25$ 21$ 863$ 863$ 863$ 0.0%
Supplies - - - - - ---
Other Services & Charges 103,201 102,148 106,589 106,589 105,500 -1.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 103,226$ 102,169$ 107,452$ 107,452$ 106,363$ -1.0%
149
TRANSIT
DEPARTMENT: Transit SUPERVISOR: City Administrator FUND #: 101 ACTIVITY #: 45178
ACTIVITY SCOPE:
The transit service is provided by contract through a subsidized, regional transit provider.
Transit operations were absorbed by Wright County in 2019.
OBJECTIVES:
1. None.
ISSUES:
1. None.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The city changed to a regional transit services provider, Wright County Area Transit (WCAT), in
2017. The 2019 decrease reflects the final obligations toward the dissolution of the WCAT joint
powers agreement. Wright County is the provider of transit, beginning in 2019.
BUDGET:
Measurement 2018 2019 2020 2021
Ridership 18,465 na na na
GENERAL FUND 2018 2019 2020 2020 2021 %
TRANSIT Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 18,333 - - - - ---
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 18,333$ -$ -$ -$ -$ ---
150
PARK OPERATIONS
DEPARTMENT: Recreation and Culture SUPERVISOR: Parks Superintendent FUND #: 101 ACTIVITY #: 45201
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. 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. Continue pathways maintenance.
2. Improve efficiencies through use of the city’s GIS.
3. Progress in implementing 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 COMMENTARY:
The parks budget consists of expenditures needed to maintain city parks and trails. Capital
outlay reflects the acquisition of capital equipment through the Central Equipment internal
service fund. Additional Central Equipment Fund purchases are planned for 2021 The 2021
personnel services budget includes a full step increase and a 2.5% market rate wage increase.
Supplies decrease due to conservation of budget availability for other recreation-related budget
units. Other budget items are expected to remain close to prior year levels.
Measurement 2018 2019 2020 2021
Park land acres maintained 320 360 360 365
Trail miles maintained 40.5 41.0 41.0 42.0
Park events held 515 520 63 100
Winter skating days 78 120 120 120
151
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
PARK - OPERATIONS Actual Actual Budget Projected Budget Change
Personnel Services 521,037$ 518,075$ 588,584$ 588,584$ 578,809$ -1.7%
Supplies 146,032 150,226 195,500 195,500 177,000 -9.5%
Other Services & Charges 149,466 149,381 181,357 181,357 179,000 -1.3%
Capital Outlay 99,800 107,800 113,400 113,400 126,800 11.8%
TOTAL EXPENDITURES 916,335$ 925,482$ 1,078,841$ 1,078,841$ 1,061,609$ -1.6%
152
PARK BALLFIELDS
DEPARTMENT: Recreation and Culture SUPERVISOR: Parks Superintendent FUND #: 101 ACTIVITY #: 45203
ACTIVITY SCOPE:
The park ballfields activity prepares and maintains city athletic fields, including the NSP
Ballfield.
OBJECTIVES:
1. Prepare and maintain city athletic fields.
2. Improve the structures at the ballfields.
3. Enhance player and visitor experience.
ISSUES:
1. Demographic and activity trends.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The 2021 budget matches the 2020 budget for field maintenance, concessions, and park
activities. Other services and charges include items that do not meet the capitalization
threshold.
BUDGET:
Measurement 2018 2019 2020 2021
Ball games played, number of 625 625 100 650
Soccer fields maintained 20 27 32 35
Lacrosse fields maintained 4 8 10 10
Ball fields maintained 7 7 7 7
Number of times mowed 50 50 50 50
GENERAL FUND 2018 2019 2020 2020 2021 %
PARK - BALLFIELDS Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies 10,528 9,359 15,600 15,600 15,600 0.0%
Other Services & Charges 10,535 10,477 11,800 11,800 11,800 0.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 21,063$ 19,836$ 27,400$ 27,400$ 27,400$ 0.0%
153
PUBLIC ARTS
DEPARTMENT: Recreation and Culture SUPERVISOR: Parks Superintendent FUND #: 101 ACTIVITY #: 45204
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 COMMENTARY:
While 2018 had activity, 2019 represented the inaugural, stand-alone budget for the public arts
initiative. 2021 other services and charges include contracting for an additional creative
consultant with increased participation of the community. This budget unit is also responsible
for utilities and repairs at the MontiArts building.
BUDGET:
Measurement 2018 2019 2020 2021
Projects 1 2 7 15
Events --31 45
GENERAL FUND 2018 2019 2020 2020 2021 %
PARK - PUBLIC ARTS Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies 2,478 6,340 3,100 3,100 4,300 38.7%
Other Services & Charges 27,398 40,614 32,564 32,564 53,200 63.4%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 29,876$ 46,954$ 35,664$ 35,664$ 57,500$ 61.2%
154
LIBRARY
DEPARTMENT: Recreation and Culture SUPERVISOR: City Administrator FUND #: 101 ACTIVITY #: 45501
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.Provide residents with quality programs and life-long learning opportunities.
2.Provide access to global information resources.
ISSUES:
1.Maintaining a relevant role in the community.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The city contracts with Great River Regional Library System for information sources and
operating personnel. The city owns and maintains the library building and funds several
programs. Total 2021 estimated expenditures are consistent with prior year levels with an
increase in proactive building maintenance. By statute, the city must annually expend at least
$35,160 for the library.
Measurement 2018 2019 2020 2021
Checked out items 182,691 171,460 112,334 130,000
Number of requests placed 8,220 9,190 7375 8,200
Summer reading participants 824 1,159 148 500
Winter reading participants 284 207 209 50
Patrons using wireless 3,224 4,022 1355 2,000
Patrons using internet stations 6,211 6,362 --
Internet sessions used --160 500
Programs offered 287 243 102 200
Program attendance 5,059 4,788 4810* 4,500
* Some programs offered after March 17, 2020 were virtual and offered only on
Facebook so counts are based on number of views on FB.
155
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
LIBRARY Actual Actual Budget Projected Budget Change
Personnel Services 2,284$ 220$ -$ -$ -$ ---
Supplies 2,658 2,943 2,000 2,000 2,500 25.0%
Other Services & Charges 44,030 50,429 45,145 45,145 51,214 13.4%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 48,972$ 53,592$ 47,145$ 47,145$ 53,714$ 13.9%
156
SHADE TREE
DEPARTMENT: Recreation and Culture SUPERVISOR: Park Superintendent FUND #: 101 ACTIVITY #: 46102
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, noise reduction, etc. 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. Provide trees for spring tree planting.
2. Continue with Shade Tree Disease Control Program.
3. Replace dead and diseased trees throughout the city and parks.
4. Continue chipping program.
5. Continue education program.
6. Begin a boulevard tree planting program.
ISSUES:
1. Stress on trees caused by weather and diseases.
2. Funding availability.
3. Chipper replacement.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
A portion of the total time of park employees is allocated to the Shade Tree activity. The 2021
personnel services budget includes a full step increase and a 2.5% market rate wage increase.
Part of the personnel services change reflects the reallocation of wages within recreation and
culture activities. Supplies in 2019 included Chelsea Road landscaping. Supplies increased in
2020 and 2021 budgets with an increased focus on prioritizing new plantings.
Measurement 2018 2019 2020 2021
Trees planted 305 314 220 245
Trees removed 12 15 6 15
Students in programs 500 500 500 0
157
BUDGET:
GENERAL FUND 2018 2019 2020 2020 2021 %
SHADE TREE Actual Actual Budget Projected Budget Change
Personnel Services 79,463$ 45,052$ 61,484$ 61,484$ 72,448$ 17.8%
Supplies 1,250 9,118 19,000 19,000 28,000 47.4%
Other Services & Charges 203 7,226 5,408 5,408 4,617 -14.6%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 80,916$ 61,396$ 85,892$ 85,892$ 105,065$ 22.3%
158
INSURANCE
DEPARTMENT: Other SUPERVISOR: Finance Director FUND #: 101 ACTIVITY #: 49240
ACTIVITY SCOPE:
This activity accounts for a variety of undistributed General Fund insurance costs.
OBJECTIVES:
1. To accurately distribute insurance costs to all activities by fund.
ISSUES:
1. Purchasing the proper level of insurance coverage with the appropriate deductibles
at the lowest possible costs.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
Other services and charges increase in 2021 due to a rise in property and casualty as well as
liability insurance premiums. The uncertainty of the COVID-19 pandemic along with increased
city-wide expenditures over the past few years caused in premium increase. An effective safety
program administered by the human resource manager helps to keep the cost of workers
compensation insurance low.
BUDGET:
Measurement 2018 2019 2020 2021
Not Applicable
GENERAL FUND 2018 2019 2020 2020 2021 %
INSURANCE Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 6,428 6,164 6,352 6,352 11,550 81.8%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 6,428$ 6,164$ 6,352$ 6,352$ 11,550$ 81.8%
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160
ENTERPRISE FUNDS
For Fiscal Year 2013
Adopted 2021
SPECIAL REVENUE FUNDS
SPECIAL REVENUE FUNDS - SUMMARY
DESCRIPTION
The city currently has four 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.
BUDGET ISSUES
Each special revenue fund has specific challenges that will be addressed in the narrative for
each fund.
BUDGET SUMMARY
SPECIAL REVENUE FUNDS 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 710,186$ 750,515$ 772,000$ 772,000$ 851,300$ 10.3%
Tax Increments 638,278 679,925 617,344 617,344 617,344 0.0%
Charges for Services 1,460,829 1,429,305 1,604,800 540,800 454,100 -71.7%
Miscellaneous 161,898 232,836 127,856 118,856 212,256 66.0%
Operating Transfers 116,473 - - 465,000 325,000 ---
TOTAL REVENUES 3,087,664$ 3,092,581$ 3,122,000$ 2,514,000$ 2,460,000$ -21.2%
EXPENDITURES
Personnel Services 1,312,151$ 1,261,954$ 1,411,864$ 1,009,759$ 880,961$ -37.6%
Supplies 154,805 194,706 221,285 94,132 78,420 -64.6%
Other Services & Charges 795,608 1,171,929 690,851 586,591 737,295 6.7%
Capital Outlay 873,368 528,605 421,000 686,000 190,324 -54.8%
Operating Transfers 432,946 230,000 200,000 200,000 200,000 0.0%
TOTAL EXPENDITURES 3,568,878$ 3,387,194$ 2,945,000$ 2,576,482$ 2,087,000$ -29.1%
FUND BALANCE - JANUARY 1 9,253,516$ 8,772,302$ 8,477,689$ 8,477,689$ 8,415,207$
Excess (Deficiency) of
Revenues over Expenditures (481,214) (294,613) 177,000 (62,482) 373,000
FUND BALANCE - DECEMBER 31 8,772,302$ 8,477,689$ 8,654,689$ 8,415,207$ 8,788,207$
161
ECONOMIC DEVELOPMENT AUTHORITY FUND
DEPARTMENT: Economic Development SUPERVISOR: Economic Development Manager FUND #: 213 ACTIVITY #: 46301
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 9
active tax increment districts and 2 decertified, active districts. 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. Explore medical manufacturing, food-related, and data center facilities for Monticello.
2. Promote city's fiber optics network to attract and retain businesses.
3. Implement short, intermediate, and long-term objectives outlined in the TIF Analysis
and Management Plan.
4. Continue to implement Embracing Downtown Plan.
5. Continue to purchase land that makes sense for redevelopment purposes.
6. Continue to market the Monticello business center.
7. Implement training/education program for existing businesses and future workforce.
8. Utilize Jobz Bill to initiate private development/redevelopment.
9. Work with community development department and developers to create upper-end
housing in Monticello to attract CEOs.
10. Explore options to generate additional electrical supply to industrial areas.
11. Explore options to relocate electrical substation from Cargill's downtown site to create
expansion opportunities.
12. Implement recommendations from consultants regarding uses of funds available in TIF
District 1-22.
13. Engage in the Greater MSP organization.
14. Implement monitoring/tracking methods for EDA programs.
15. Continue to build a more robust website and marketing brand.
ISSUES:
1. Consistent administration of city policies, plans, ordinances, guidelines, statutes, etc.
2. Need for higher wage jobs in the community.
3. Promotion of city's fiber optic network.
162
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
This budget represents the Monticello Economic Development Authority programs and
general administration activities. The main revenue source for the EDA Fund is tax increments
from the various districts. Under Section 469.033, subd. 6, of the HRA Act, the HRA’s special
benefit tax is levied annually and is limited to .0185% of the taxable market value. The
increase in miscellaneous revenues in 2021 is an anticipated land sale. The higher capital
outlay expenditures in 2020 are for relocation costs in preparation for redevelopment of
Block 52.
Expenditures include administrative costs, pay-as-you-go payments to various development
projects, and a transfer to debt service funds for its share of the 2011A refunding
improvement bond, which financed an interchange project in tax increment district 1-34. One
district collected increment for the first time in 2020, and one has an estimated first
increment in 2022. Much of the fund balance is non-spendable (land held for resale) or
restricted to specific activities such as development in tax increment districts and loans to
qualifying businesses.
BUDGET:
Measurement 2018 2019 2020 2021
Property acquisitions 4 2 4 4
GMEF loans outstanding 2 2 2 5
Active TIF districts 9 8 10 10
EDA FUND 2018 2019 2020 2020 2021 %
REVENUES ACTUA L ACTUAL BUDGET PROJECTED B UDGET CHANGE
Property Taxes 323,186$ 348,515$ 355,000$ 355,000$ 366,300$ 3.2%
Tax Increments 638,278 679,925 617,344 617,344 617,344 0.0%
Miscellaneous 59,034 157,644 93,656 93,656 202,356 116.1%
Operating Transfers 116,473 - - - - ---
TOTAL REVENUES 1,136,971$ 1,186,084$ 1,066,000$ 1,066,000$ 1,186,000$ 11.3%
EXPENDITURES
Personnel Services 111,962$ 127,129$ 129,866$ 129,866$ 137,597$ 6.0%
Supplies - 146 100 100 200 100.0%
Other Services & Charges 270,442 601,606 253,034 253,034 289,879 14.6%
Capital Outlay 782,207 154,404 321,000 321,000 190,324 -40.7%
Operating Transfers 200,000 230,000 200,000 200,000 200,000 0.0%
TOTAL EXPENDITURES 1,364,611$ 1,113,285$ 904,000$ 904,000$ 818,000$ -9.5%
FUND BALANCE - JANUARY 1 7,468,105$ 7,240,465$ 7,313,264$ 7,313,264$ 7,475,264$
Excess (Deficiency) of
Revenues over Expenditures (227,640) 72,799 162,000 162,000 368,000
FUND BALANCE - DECEMBER 31 7,240,465$ 7,313,264$ 7,475,264$ 7,475,264$ 7,843,264$
163
CEMETERY FUND
DEPARTMENT: Recreation and Culture SUPERVISOR: Parks Superintendent FUND #: 215 ACTIVITY #: 49010
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 assists 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 that is also accounted for in this fund.
OBJECTIVES:
1. Serve the public in a courteous, professional manner.
2. Maintain cemetery grounds and grave markers.
ISSUES:
1. Increasing maintenance costs.
2. Competition from cremations.
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Plot occupied 3,553 3,575 3,598 3,598
Plots reserved 739 683* 683 683
Plots available for sale 1,097 1,132 1,119 1,132
Number of plots sold 13 10 11 20
Number of internments 22 21 22 20
Number of markers staked 13 12 15 25
Columbarium slots occupied --4 10
Columbarium slots reserved -2 2 2
Columbarium slots available -96 90 80
Columbarium slots sold --6 10
Ossuary slots occupied ----
Ossuary slots reserved -50 50 50
Ossuary slots available -265 265 265
Ossuary slots sold -50 50 50
The Columbarium-Ossuary will have 96 columbarium and 315 ossuary slots.
* 2019 - Reclaim year
164
BUDGET COMMENTARY:
In 2019, the city acquired an ossuary-columbarium for an estimated $60,000. Other
expenditures are estimated near prior year levels. 2019 charges for services includes the sale of
50 ossuary slots to a local hospital for $20,000.
BUDGET:
CEMETERY 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 19,086$ 52,405$ 33,000$ 33,000$ 32,900$ -0.3%
Miscellaneous 528 1,670 - - 100 ---
TOTAL REVENUES 19,614$ 54,075$ 33,000$ 33,000$ 33,000$ 0.0%
EXPENDITURES
Personnel Services 584$ 2,597$ 2,652$ 2,652$ 2,652$ 0.0%
Supplies 418 2,338 1,135 1,135 1,100 -3.1%
Other Services & Charges 17,499 20,219 29,213 29,213 29,248 0.1%
Capital Outlay - 54,906 - - - ---
TOTAL EXPENDITURES 18,501$ 80,060$ 33,000$ 33,000$ 33,000$ 0.0%
FUND BALANCE - JANUARY 1 50,946$ 52,059$ 26,074$ 26,074$ 26,074$
Excess (Deficiency) of
Revenues over Expenditures 1,113 (25,985) - - -
FUND BALANCE - DECEMBER 31 52,059$ 26,074$ 26,074$ 26,074$ 26,074$
165
SMALL CITIES DEVELOPMENT PROGRAM (SCDP) FUND
DEPARTMENT: Small Cities Development Program Fund SUPERVISOR: Community Development Director FUND #: 221 ACTIVITY #: 46500
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 COMMENTARY:
Repayment of loans and interest earned on investments make up the anticipated activity in
2021. In 2018, a change in state statute allowed cities with uncommitted money received from
repayment of funds to give 20% of the funds back to the state and keep the remaining 80%,
which then became unrestricted. Operating transfers included a 50-50 split to the EDA and
Capital Projects Fund for the portion retained by the city.
BUDGET:
Measurement 2018 2019 2020 2021
Loans o utstanding 0 1 1 1
SCDP FUND 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Miscellaneous 10,207$ 25,886$ 15,000$ 15,000$ 5,000$ -66.7%
TOTAL REVENUES 10,207$ 25,886$ 15,000$ 15,000$ 5,000$ -66.7%
EXPENDITURES
Other Services & Charges 58,237 - - - - ---
Operating Transfers 232,946 - - - - ---
TOTAL EXPENDITURES 291,183$ -$ -$ -$ -$ ---
FUND BALANCE - JANUARY 1 1,153,959$ 872,983$ 898,869$ 898,869$ 913,869$
Excess (Deficiency) of
Revenues over Expenditures (280,976) 25,886 15,000 15,000 5,000
FUND BALANCE - DECEMBER 31 872,983$ 898,869$ 913,869$ 913,869$ 918,869$
166
COMMUNITY CENTER FUND
DEPARTMENT: Community Center SUPERVISOR: Community Center Director FUND #: 226 ACTIVITY #: 4512X
ACTIVITY SCOPE:
The Monticello Community Center 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. Develop a plan for the area previously used as a wheel park (skateboard, bike, and
rollerblade) including design, financing, construction, and marketing.
2. Develop an on-line registration system for program and membership sign up.
3. Provide facility improvements to increase customers.
4. Improve financial controls and budget management.
ISSUES:
1. Staff turnover and vacancies.
2. Limitations to facility size and parking availability.
3. Competition from other fitness facilities.
4. Segregation of revenues and expenditures to various community center activities.
5. Safety regulations related to business operations in the COVID-19 pandemic.
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Customer visits, number of 182,486 184,106 71,632 61,000
Gross program sales 183,194$ 112,506$ 17,930$ 37,000$
Annual memberships 1,569 1,457 1,150 485
Monthly memberships 2,347 1,878 1,433 626
Three-month memberships 306 1,749 308 583
Ratio of annual memberships
to other memberships 5.77 2.45 5.85 2.45
Rental revenue 199,201$ 197,352$ 73,096$ 65,784$
Numbers dropped significantly in 2020 due to the COVID-19 pandemic. 2021 amounts
are estimated conservatively as local operations restrictions are subject to change.
167
BUDGET COMMENTARY:
The largest revenue sources are memberships and property taxes. While charges for services
are typically the largest source of revenue, the COVID-19 pandemic forced closure of the facility
for 4 months in 2020. The closure created great financial burden on the Community Center
which caused an increased reliance on property taxes and transfers from the Liquor Fund to
avoid a negative fund balance. Other revenues include concession sales, room rentals, and
program fees. The 2021 personnel services budget includes a full step increase and a 2.5%.
However, reduced hours of operation lead to reduced staffing costs and fewer supplies needed.
For 2020, all capital expenditures were halted when the pandemic began and are delayed to
conserve resources.
Within the Community Center fund, revenues and expenditures are allocated to various
activities: administration, rentals and events, aquatics, guest services and concessions,
maintenance, and programming.
BUDGET:
COMMUNITY CENTER 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 387,000$ 402,000$ 417,000$ 417,000$ 485,000$ 16.3%
Charges for Services 1,441,743 1,376,900 1,571,800 507,800 421,200 -73.2%
Miscellaneous 92,129 47,636 19,200 10,200 4,800 -75.0%
Operating Transfers - - - 465,000 325,000 ---
TOTAL REVENUES 1,920,872$ 1,826,536$ 2,008,000$ 1,400,000$ 1,236,000$ -38.4%
EXPENDITURES
Personnel Services 1,199,605$ 1,132,228$ 1,279,346$ 877,241$ 740,712$ -42.1%
Supplies 154,387 192,222 220,050 92,897 77,120 -65.0%
Other Services & Charges 449,430 550,104 408,604 304,344 418,168 2.3%
Capital Outlay 91,161 319,295 100,000 365,000 - -100.0%
TOTAL EXPENDITURES 1,894,583$ 2,193,849$ 2,008,000$ 1,639,482$ 1,236,000$ -38.4%
FUND BALANCE - JANUARY 1 580,506$ 606,795$ 239,482$ 239,482$ -$
Excess (Deficiency) of
Revenues over Expenditures 26,289 (367,313) - (239,482) -
FUND BALANCE - DECEMBER 31 606,795$ 239,482$ 239,482$ -$ -$
168
ENTERPRISE FUNDS
For Fiscal Year 2013
Adopted 2021
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
eight active debt service (sub)funds that are combined into one debt service fund for financial reporting
purposes.
BUDGET ISSUES
The city's bond rating was downgraded from Aa3 to A2 in 2012 by Moody's Investor Services. This rating
was upgraded to A1 with the sale of the city’s 2019A debt issue in 2019 and affirmed with the city’s 2020A
debt issue. See individual (sub)funds for the purpose and budget issues facing each debt service (sub)fund.
Fund balances in some (sub)funds declined with early bond redemptions. Prior to 2014, bonds had been
issued with February principal payments, new bond issues are structured to have December, rather than
February, principal payments.
BUDGET SUMMARY
DEBT SERVICE FUNDS 2018 2019 2020 2020 2021 %
REVENUES ACTUA L ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 1,787,000$ 2,227,646$ 2,939,987$ 2,939,987$ 2,831,479$ -3.7%
Special Assessments 327,111 373,337 228,104 352,624 229,595 0.7%
Miscellaneous 33,773 48,275 5,200 5,200 8,926 71.7%
Operating Transfers 249,899 345,000 200,000 200,000 200,000 0.0%
TOTAL REVENUES 2,397,783$ 2,994,258$ 3,373,291$ 3,497,811$ 3,270,000$ -3.1%
EXPENDITURES
Debt Service 2,807,220$ 3,489,241$ 4,148,774$ 4,148,774$ 3,325,000$ -19.9%
Operating Transfers - 75,000 - - - ---
TOTAL EXPENDITURES 2,807,220$ 3,564,241$ 4,148,774$ 4,148,774$ 3,325,000$ -19.9%
FUND BALANCE - JANUARY 1 2,800,981$ 2,391,544$ 1,821,561$ 1,821,561$ 1,170,598$
Excess (Deficiency) of
Revenues over Expenditures (409,437) (569,983) (775,483) (650,963) (55,000)
FUND BALANCE - DECEMBER 31 2,391,544$ 1,821,561$ 1,046,078$ 1,170,598$ 1,115,598$
169
2011A G.O. REFUNDING BOND SUB-FUND
DEPARTMENT: Debt Service SUPERVISOR: Finance Director FUND #: 312 ACTIVITY #: 47000
ACTIVITY SCOPE:
The 2011A G.O. Refunding Bonds refinanced the 2005A G.O. Improvement Bonds. The debt
service schedule calls for semi-annual payments in February (principal and interest) and August
(interest only). The average interest rate is 1.6112%. The 2011A bonds was partially redeemed
on February 1, 2020.
OBJECTIVES:
1. Make scheduled debt payments in a timely manner.
ISSUES:
1. Ensuring sufficient tax increment is received to make debt service payments.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The city issued $10,735,000 in 2011 G.O. Refunding Bonds to advance refund the 2005A G.O.
Improvement Bonds on February 1, 2013. The revenue sources include a combination of
development fees, property taxes, special assessments, and tax increments. With the partial
redemption in 2020, the remaining balance is expected to be paid using transfers in from tax
increment received in the Economic Development Authority (EDA) fund. All assessment
balances were transferred to the Consolidated Bond fund in 2020.
Measurement 2018 2019 2020 2021
Assessment balance $2,570,679 $2,535,167 $0 $0
Assessment balance deferred $2,258,015 $1,972,819 $0 $0
Deferred % of balance 88% 78% 0% 0%
Delinquent balance $0 $0 $0 $0
Prepaid assessments $2,270 $0 $0 $0
Assessment rolls 3 4 0 0
Assessed parcels 7 7 0 0
170
BUDGET:
REMAINING DEBT SERVICE:
2011A G.O. BOND FUND (2005A)2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 148,061$ 150,581$ 172,641$ 172,641$ -$ -100.0%
Special Assessments 58,261 52,715 50,761 50,761 - -100.0%
Miscellaneous 9,106 18,037 2,000 2,000 1,000 -50.0%
Operating Transfers 200,000 205,000 200,000 200,000 200,000 0.0%
TOTAL REVENUES 415,428$ 426,333$ 425,402$ 425,402$ 201,000$ -52.8%
EXPENDITURES
Debt Service 780,054 429,521 1,271,450 1,271,450 200,000 -84.3%
FUND BALANCE - JANUARY 1 1,260,962$ 896,336$ 893,148$ 893,148$ 47,100$
Excess (Deficiency) of
Revenues over Expenditures (364,626) (3,188) (846,048) (846,048) 1,000
FUND BALANCE - DECEMBER 31 896,336$ 893,148$ 47,100$ 47,100$ 48,100$
Payable Principal Interest Rate Total
2/1/2021 190,000$ 5,775$ 3.00% 195,775$
8/1/2021 2,925 2,925
2/1/2022 195,000 2,925 3.00% 197,925
Total 385,000$ 11,625$ 396,625$
GO Refunding Bonds, Series 2011A
171
2014A G.O. JUDGMENT BOND SUB-FUND
DEPARTMENT: Debt Service SUPERVISOR: Finance Director FUND #: 318 ACTIVITY #: 47000
ACTIVITY SCOPE:
The 2014A G.O. Judgment Bonds financed the settlement with telecommunications
bondholders. The $5,750,000 settlement essentially relieves the city of liability for the
$26,445,000 in revenue bonds used to finance its telecommunications utility. The judgment
portion of the 2014A bonds totaled $6,080,000. The city borrowed (capitalized interest) the
2015 interest only payments. Thereafter, the city added the annual principal and interest debt
service payments to its tax levy. The average interest rate is 3.0696%. The bonds are eligible
for early redemption in 2021.
OBJECTIVES:
1. Make scheduled debt payments in a timely manner.
2. Redeem or refund when feasible.
ISSUES:
1. Maintain adherence to bond covenants and awareness of arbitrage limitations.
2. Balancing the property tax levy for this bond with the needs of other debt.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The $6,595,000 2014A G.O. bond issue had two components: $6,080,000 judgment portions
and $515,000 capital equipment portion. The capital equipment portion is accounted for in the
Central Equipment Fund. The final payment on the bonds is in December 2030 but the bonds
are redeemable in 2021. However, an extraordinary optional redemption provision allows the
city to redeem the bonds at any time for 101% of par if the fiber optics system is sold or leased.
The settlement proceeds were distributed directly to the trustee for the bondholders.
Measurement 2018 2019 2020 2021
Not Applicable
172
BUDGET:
REMAINING DEBT SERVICE:
2014A G.O. JUDGMENT BONDS 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 537,586$ 537,244$ 535,501$ 535,501$ 513,570$ -4.1%
Miscellaneous 3,151 5,915 1,000 1,000 1,430 43.0%
TOTAL REVENUES 540,737$ 543,159$ 536,501$ 536,501$ 515,000$ -4.0%
EXPENDITURES
Debt Service 512,665 512,357 510,801 510,801 513,000 0.4%
FUND BALANCE - JANUARY 1 62,814$ 90,886$ 121,688$ 121,688$ 147,388$
Excess (Deficiency) of
Revenues over Expenditures 28,072 30,802 25,700 25,700 2,000
FUND BALANCE - DECEMBER 31 90,886$ 121,688$ 147,388$ 147,388$ 149,388$
Payable Principal Interest Rate Total
6/15/2021 -$ 68,486$ 68,486$
12/15/2021 375,000 68,486 2.50% 443,486
6/15/2022 - 63,798 63,798
12/15/2022 385,000 63,798 2.75% 448,798
6/15/2023 - 58,504 58,504
12/15/2023 395,000 58,504 2.90% 453,504
6/15/2024 - 52,777 52,777
12/15/2024 405,000 52,777 3.05% 457,777
6/15/2025 - 46,600 46,600
12/15/2025 420,000 46,600 3.20% 466,600
6/15/2026 - 39,881 39,881
12/15/2026 435,000 39,881 3.35% 474,881
6/15/2027 - 32,594 32,594
12/15/2027 445,000 32,594 3.40% 477,594
6/15/2028 - 25,029 25,029
12/15/2028 465,000 25,029 3.38% 490,029
6/15/2029 - 17,182 17,182
12/15/2029 480,000 17,182 3.55% 497,182
6/15/2030 - 8,663 8,663
12/15/2030 495,000 8,663 3.50% 503,663
Total 4,300,000$ 827,028$ 5,127,028$
GO Bonds, Series 2014A (Judgment Portion)
173
2015B G.O. STREET RECONSTRUCTION-IMPROVEMENT BOND SUB-FUND
DEPARTMENT: Debt Service SUPERVISOR: Finance Director FUND #: 319 ACTIVITY #: 47000
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 are
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 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 the platted parcels in
2021 causing an increase in assessment rolls and assessed parcels related to the bond issue.
Measurement 2018 2019 2020 2021
Assessment balance $120,365 $103,170 $92,013 $74,214
Deferred assessments $0 $0 $0 $0
Deferred % of balance 0% 0% 0% 0%
Delinquent balance $0 $0 $0 $0
Prepaid assessments $0 $0 $0 $0
Assessment rolls 1 1 1 2
Assessed parcels 1 1 1 28
174
BUDGET:
REMAINING DEBT SERVICE:
2015B G.O. Bonds 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 203,425$ 200,905$ 198,385$ 198,385$ 201,115$ 1.4%
Special Assessments 24,416 23,514 21,709 21,709 22,720 4.7%
Miscellaneous 2,033 4,448 500 500 1,165 133.0%
TOTAL REVENUES 229,874$ 228,867$ 220,594$ 220,594$ 225,000$ 2.0%
EXPENDITURES
Debt Service 215,979 213,546 211,250 211,250 214,000 1.3%
FUND BALANCE - JANUARY 1 80,200$ 94,095$ 109,416$ 109,416$ 118,760$
Excess (Deficiency) of
Revenues over Expenditures 13,895 15,321 9,344 9,344 11,000
FUND BALANCE - DECEMBER 31 94,095$ 109,416$ 118,760$ 118,760$ 129,760$
Payable Principal Interest Rate Total
6/15/2021 -$ 24,024$ 24,024$
12/15/2021 165,000 24,024 2.00% 189,024
6/15/2022 - 22,376 22,376
12/15/2022 165,000 22,376 2.00% 187,376
6/15/2023 - 20,724 20,724
12/15/2023 170,000 20,724 2.50% 190,724
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 1,830,000$ 293,048$ 2,123,048$
GO Bonds, Series 2015B
175
2016A G.O. STREET RECONSTRUCTION-IMPROVEMENT BOND SUB-FUND
DEPARTMENT: Debt Service SUPERVISOR: Finance Director FUND #: 320 ACTIVITY #: 47000
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 are 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.
2. Investment earnings on prepaid assessments will be less than assessed interest
rates.
MEASURABLE WORKLOAD DATA:
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
Measurement 2018 2019 2020 2021
Assessment balance $614,712 $516,625 $396,383 $322,619
Deferred assessments $0 $0 $0 $0
Deferred % of balance 0% 0% 0% 0%
Delinquent balance $0 $0 $0 $0
Prepaid assessments $18,023 $21,619 $46,478 $0
Assessment rolls 2 2 2 2
Assessed parcels 89 85 76 76
176
assessment prepayments, interest earned on the prepayments and interest foregone on the
prepayments.
BUDGET:
REMAINING DEBT SERVICE:
2016A G.O. Bonds 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJ ECTED BUDGET CHANGE
Property Taxes 407,769$ 409,134$ 405,039$ 405,039$ 406,089$ 0.3%
Special Assessments 127,157 123,176 97,759 97,759 81,422 -16.7%
Miscellaneous 6,585 14,970 1,000 1,000 1,489 48.9%
TOTAL REVENUES 541,511$ 547,280$ 503,798$ 503,798$ 489,000$ -2.9%
EXPENDITURES
Debt Service 527,829 529,096 525,350 525,350 527,000 0.3%
FUND BALANCE - JANUARY 1 334,760$ 348,442$ 366,626$ 366,626$ 345,074$
Excess (Deficiency) of
Revenues over Expenditures 13,682 18,184 (21,552) (21,552) (38,000)
FUND BALANCE - DECEMBER 31 348,442$ 366,626$ 345,074$ 345,074$ 307,074$
Payable Principal Interest Rate Total
6/15/2021 -$ 32,775$ 32,775$
12/15/2021 460,000 32,775 2.00% 492,775
6/15/2022 - 28,175 28,175
12/15/2022 470,000 28,175 2.00% 498,175
6/15/2023 - 23,475 23,475
12/15/2023 480,000 23,475 2.00% 503,475
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 3,155,000$ 269,900$ 3,424,900$
GO Bonds, Series 2016A
177
2017A G.O. IMPROVEMENT-ABATEMENT BOND SUB-FUND
DEPARTMENT: Debt Service SUPERVISOR: Finance Director FUND #: 321 ACTIVITY #: 47000
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.
2. Investment earnings on prepaid assessments will be less than assessed interest
rates.
MEASURABLE WORKLOAD DATA:
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 abatement tax 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.
Measurement 2018 2019 2020 2021
Assessment balance $382,993 $262,955 $226,644 $193,774
Deferred assessments $0 $0 $0 $0
Deferred % of balance 0% 0% 0% 0%
Delinquent balance $702 $0 $0 $0
Prepaid assessments $8,290 $77,483 $3,442 $0
Assessment rolls 2 2 2 2
Assessed parcels 69 59 57 57
178
BUDGET:
REMAINING DEBT SERVICE:
2017A G.O. Bonds 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 450,159$ 429,782$ 427,367$ 427,367$ 430,097$ 0.6%
Special Assessments 76,171 137,796 57,875 57,875 42,577 -26.4%
Miscellaneous 4,330 10,322 500 500 1,326 165.2%
TOTAL REVENUES 530,660$ 577,900$ 485,742$ 485,742$ 474,000$ -2.4%
EXPENDITURES
Debt Service 470,190 472,286 470,140 470,140 473,000 0.6%
FUND BALANCE - JANUARY 1 102,545$ 163,015$ 268,629$ 268,629$ 284,231$
Excess (Deficiency) of
Revenues over Expenditures 60,470 105,614 15,602 15,602 1,000
FUND BALANCE - DECEMBER 31 163,015$ 268,629$ 284,231$ 284,231$ 285,231$
Payable Principal Interest Rate Total
6/15/2021 -$ 45,969$ 45,969$
12/15/2021 380,000 45,969 2.00% 425,969
6/15/2022 - 42,171 42,171
12/15/2022 385,000 42,171 2.00% 427,171
6/15/2023 - 38,320 38,320
12/15/2023 390,000 38,320 2.00% 428,320
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 3,925,000$ 576,458$ 4,501,458$
GO Bonds, Series 2017A
179
2018A G.O. ABATEMENT BOND SUB-FUND
DEPARTMENT: Debt Service SUPERVISOR: Finance Director FUND #: 322 ACTIVITY #: 47000
ACTIVITY SCOPE:
The 2018A G.O. Abatement Bonds provided funding for Fallon Avenue overpass right-of-way
acquisition, engineering, and construction. This $5,000,000 issue does not provide financing for
any other project types (improvement, street reconstruction, etc.). The bonds have an average
interest rate of 3.151% and are redeemable in December of 2026. Abatement bonds were
issued in 2019 to reimburse the city for the remaining costs on the overpass project. All three
abatement issues (2017, 2018, and 2019) will 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.
2.Accumulating resources for early redemption.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
Unlike the 2017A bond issue, the $5,000,000 2018A G.O. bond issue has only one component:
Abatement. Property taxes are levied for annual principal and interest payments. A debt service
levy covers the annual bond interest payment, and an abatement levy covers the annual bond
principal payment. The city levies for the entire annual principal and interest payments.
Measurement 2018 2019 2020 2021
Not Applicable
180
BUDGET:
REMAINING DEBT SERVICE:
2018A G.O. Bonds 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes $0 $500,000 $472,434 $472,434 $448,077 -5.2%
Miscellaneous 27 3,027 200 200 923 361.5%
Operating Transfers 5,000 - - - - ---
TOTAL REVENUES 5,027$ 503,027$ 472,634$ 472,634$ 449,000$ -5.0%
EXPENDITURES
Debt Service - 451,011 450,737 450,737 447,000 -0.8%
FUND BALANCE - JANUARY 1 -$ 5,027$ 57,043$ 57,043$ 78,940$
Excess (Deficiency) of
Revenues over Expenditures 5,027 52,016 21,897 21,897 2,000
FUND BALANCE - DECEMBER 31 5,027$ 57,043$ 78,940$ 78,940$ 80,940$
Payable Principal Interest Rate Total
6/15/2021 -$ 67,894$ 67,894$
12/15/2021 310,000 67,894 3.00% 377,894
6/15/2022 - 63,244 63,244
12/15/2022 320,000 63,244 3.00% 383,244
6/15/2023 - 58,443 58,443
12/15/2023 330,000 58,443 3.00% 388,443
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 4,420,000$ 945,938$ 5,365,938$
GO Bonds, Series 2018A Abatement Bonds
181
2019A G.O. ABATEMENT, EQUIPMENT, CIP & IMPROVEMENT BOND SUB-FUND
DEPARTMENT: Debt Service SUPERVISOR: Finance Director FUND #: 323 ACTIVITY #: 47000
ACTIVITY SCOPE:
The 2019A bonds financed the completion of the Fallon Avenue overpass, 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 issues (2017, 2018, and 2019) will 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.
2. Accumulating resources for early redemption.
MEASURABLE WORKLOAD DATA:
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 existing city funds, property taxes, and special assessments.
Measurement 2018 2019 2020 2021
Assessment balance - $92,070 $81,840 $71,610
Deferred assessments -$0 $0 $0
Deferred % of balance -0% 0% 0%
Delinquent balance -$0 $0 $0
Prepaid assessments -$0 $0 $0
Assessment rolls -1 1 1
Assessed parcels -9 9 9
182
BUDGET:
REMAINING DEBT SERVICE:
2019A GO BONDS 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes -$ -$ 728,620$ 728,620$ 714,945$ -1.9%
Special Assessments - - - - 14,322 ---
Miscellaneous - 11 - - 733 ---
Operating Transfers - 5,000 - - - ---
TOTAL REVENUES -$ 5,011$ 728,620$ 728,620$ 730,000$ 0.2%
EXPENDITURES
Debt Service - - 709,046 709,046 715,000 0.8%
FUND BALANCE - JANUARY 1 -$ -$ 5,011$ 5,011$ 24,585$
Excess (Deficiency) of
Revenues over Expenditures - 5,011 19,574 19,574 15,000
FUND BALANCE - DECEMBER 31 -$ 5,011$ 24,585$ 24,585$ 39,585$
Payable Principal Interest Rate Total
6/15/2021 -$ 76,794$ 76,794$
12/15/2021 560,000 76,794 2.00% 636,794
6/15/2022 - 71,194 71,194
12/15/2022 575,000 71,194 2.00% 646,194
6/15/2023 - 65,444 65,444
12/15/2023 580,000 65,444 2.00% 645,444
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 7,495,000$ 1,105,046$ 8,600,046$
GO Bonds, Series 2019A
183
2020A G.O. IMPROVEMENT BOND SUB-FUND
DEPARTMENT: Debt Service SUPERVISOR: Finance Director FUND #: 324 ACTIVITY #: 47000
ACTIVITY SCOPE:
The 2020A bonds financed the 2020 Street Improvement project. 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.
2. Accumulating resources for early redemption.
3. Investment earnings on prepaid assessments will be less than assessed interest
rates.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The city issued the $2,155,000 2020A G.O. Bonds to finance the 2020 Street Improvement
project. Property taxes and special assessments also support debt service payments.
Expenditures consist of debt principal and interest payments and fiscal agent fees.
Measurement 2018 2019 2020 2021
Assessment balance - - $508,813 $457,932
Deferred assessments --$0 $0
Deferred % of balance --0% 0%
Delinquent balance --$0 $0
Prepaid assessments --$124,520 $0
Assessment rolls --1 1
Assessed parcels --251 251
184
BUDGET:
REMAINING DEBT SERVICE:
2020A GO BONDS 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes -$ -$ -$ -$ 117,586$ ---
Special Assessments - - - 124,520 68,554 ---
Miscellaneous - - - - 860 ---
TOTAL REVENUES -$ -$ -$ 124,520$ 187,000$ ---
EXPENDITURES
Debt Service - - - - 236,000 ---
FUND BALANCE - JANUARY 1 -$ -$ -$ -$ 124,520$
Excess (Deficiency) of
Revenues over Expenditures - - - 124,520 (49,000)
FUND BALANCE - DECEMBER 31 -$ -$ -$ 124,520$ 75,520$
Payable Principal Interest Rate Total
6/15/2021 -$ 26,923$ 26,923$
12/15/2021 190,000 17,559 2.00% 207,559
6/15/2022 - 15,659 15,659
12/15/2022 205,000 15,659 2.00% 220,659
6/15/2023 - 13,609 13,609
12/15/2023 210,000 13,609 2.00% 223,609
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 2,155,000$ 192,402$ 2,347,402$
GO Bonds, Series 2020A
185
CLOSED DEBT SERVICE FUNDS
CLOSED FUNDS INCLUDED IN SUMMARY TOTAL:
2010A G.O. Improvement Bond Sub-Fund
CLOSED FUNDS SUMMARY TOTAL:
2010A GO IMPROVEMENT BOND 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 40,000$ -$ -$ -$ -$ ---
Special Assessments 41,106 36,136 - - - ---
Miscellaneous 8,541 (8,455) - - - ---
Operating Transfers 44,899 135,000 - - - ---
TOTAL REVENUES 134,546$ 162,681$ -$ -$ -$ ---
EXPENDITURES
Debt Service 300,503 881,424 - - - ---
Operating Transfers - 75,000 - - - ---
TOTAL EXPENDITURES 300,503$ 956,424$ -$ -$ -$ ---
FUND BALANCE - JANUARY 1 959,700$ 793,743$ -$ -$ -$
Excess (Deficiency) of
Revenues over Expenditures (165,957) (793,743) - - -
FUND BALANCE - DECEMBER 31 793,743$ -$ -$ -$ -$
186
ENTERPRISE FUNDS
For Fiscal Year 2013
Adopted 2021
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 five
active capital project funds.
BUDGET ISSUES
Financing capital asset additions or replacements has been an ongoing challenge, especially in
an environment where the focus is on maintaining a low, stable property tax levy, and other
traditional resources (Liquor Fund transfers) are diverted to other needs. See the individual
funds for the budget issues facing each capital project fund.
BUDGET SUMMARY
TOTAL CAPITAL PROJECT 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 835,595$ 707,660$ 300,013$ 300,013$ 578,221$ 92.7%
Franchise & Other Taxes $141,622 $221,934 $100,000 $100,000 $110,000 10.0%
Intergovernmental Revenues 483,034 465,634 - - 2,100,000 ---
Charges for Services 120,360 159,779 - - - ---
Special Assessments 372,874 338,542 70,000 70,000 205,575 193.7%
Miscellaneous 156,818 541,957 122,000 122,230 102,204 -16.2%
Operating Transfers 1,716,473 5,558,040 1,320,000 1,320,000 1,094,000 -17.1%
Debt Proceeds 5,040,882 8,131,662 2,200,000 2,200,000 - -100.0%
TOTAL REVENUES 8,867,658$ 16,125,208$ 4,112,013$ 4,112,243$ 4,190,000$ 1.9%
EXPENDITURES
Other Services & Charges 159,911$ 420,322$ -$ -$ -$ ---
Capital Outlay 9,564,158 7,484,899 3,550,000 3,550,000 2,440,000 -31.3%
Operating Transfers 49,899 1,566,818 - - 1,854,000 ---
TOTAL EXPENDITURES 9,773,968$ 9,472,039$ 3,550,000$ 3,550,000$ 4,294,000$ 21.0%
FUND BALANCE - JANUARY 1 12,803,156$ 11,896,846$ 18,550,015$ 18,550,015$ 19,112,258$
Excess (Deficiency) of
Revenues over Expenditures (906,310) 6,653,169 562,013 562,243 (104,000)
FUND BALANCE - DECEMBER 31 11,896,846$ 18,550,015$ 19,112,028$ 19,112,258$ 19,008,258$
187
CAPITAL PROJECT FUND
DEPARTMENT: Capital Project Fund SUPERVISOR: City Engineer FUND #: 400 ACTIVITY #: 43300
ACTIVITY SCOPE:
The Capital Project Fund is a generic fund of the same type used to account for on-going
capital asset additions and replacements. Capital assets acquired through this fund include
street improvements or other infrastructure and buildings.
OBJECTIVES:
1. Improve city infrastructure.
2. Extend city infrastructure to new developments.
3. Acquire large, non-proprietary fund, capital equipment (e.g. fire ladder truck).
ISSUES:
1. Funding growth and replacement improvements in a stable debt and property tax levy
environment.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
Intergovernmental revenues of $2.1 million are budgeted in 2021 but are related to the Fallon
Avenue Overpass project that was completed in 2018.
For 2021, notable projects include: Curb and landscaping work as part of the County’s Fenning
Avenue Reconstruction project - $300,000 and Public Works facility land acquisition - $600,000.
Funding is projected to come from fund balance. The 2021 property tax levy reduces the need
for future debt and stabilizes the overall levy to accommodate future debt. A $200,000 transfer
out is planned to replenish the Sewage Fund for access charges that were used previously for
capital.
Measurement 2018 2019 2020 2021
Projects supported 5 8 4 5
188
BUDGET:
CAPITAL PROJECT FUND 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 835,595$ 707,660$ 300,013$ 300,013$ 578,221$ 92.7%
Franchise & Other Taxes 19,363 56,011 20,000 20,000 20,000 0.0%
Intergovernmental Revenues 483,034 465,634 - - 2,100,000 ---
Special Assessments 224,387 225,492 - - 54,755 ---
Miscellaneous 85,315 302,240 40,000 40,000 40,024 0.1%
Operating Transfers 1,316,473 3,383,040 900,000 900,000 - -100.0%
Debt Proceeds 5,040,882 8,131,662 2,200,000 2,200,000 - -100.0%
TOTAL REVENUES 8,005,049$ 13,271,739$ 3,460,013$ 3,460,013$ 2,793,000$ -19.3%
EXPENDITURES
Other Services & Charges 147,512 220,702 - - - ---
Capital Outlay 8,956,147 5,563,185 2,875,000 2,875,000 1,590,000 -44.7%
Operating Transfers 5,000 5,000 - - 200,000 ---
TOTAL EXPENDITURES 9,108,659$ 5,788,887$ 2,875,000$ 2,875,000$ 1,790,000$ -37.7%
FUND BALANCE - JANUARY 1 8,017,460$ 6,913,850$ 14,396,702$ 14,396,702$ 14,981,715$
Excess (Deficiency) of
Revenues over Expenditures (1,103,610) 7,482,852 585,013 585,013 1,003,000
FUND BALANCE - DECEMBER 31 6,913,850$ 14,396,702$ 14,981,715$ 14,981,715$ 15,984,715$
189
CLOSED BOND FUND
DEPARTMENT: Closed Bond Fund SUPERVISOR: Finance Director FUND #: 402 ACTIVITY #: 47000
ACTIVITY SCOPE:
The Closed Bond Fund, formerly accounted for in the debt service section, is the combination
of multiple closed debt service funds. The fund has no debt obligation. However, special
assessments supporting past debt service continue to provide funding for city projects.
OBJECTIVES:
1. Provide funding for various city projects, including Bertram Chain of Lakes
improvements.
2. Certify or collect deferred special assessments when development occurs after
related debt has been fully amortized.
ISSUES:
1. Declining assessment collections on retired debt.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
This fund is used to accumulate special assessment collections from discontinued debt service
funds. The debts related to these special assessments have matured or been redeemed early. In
prior years, this fund primarily financed Bertram Chain of Lakes land acquisitions. Other smaller
transfers were used for park and pathway improvements. Future assessment collections for are
roughly $2.6 million, but a large portion of that is deferred assessments that are not due and
collectible.
Measurement 2018 2019 2020 2021
Not Applicable
190
BUDGET:
CLOSED BOND FUND 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Special Assessments 148,487$ 77,974$ 70,000$ 70,000$ 150,820$ 115.5%
Miscellaneous 9,114 25,075 5,000 5,000 5,180 3.6%
Operating Transfers - 75,000 - - - ---
TOTAL REVENUES 157,601$ 178,049$ 75,000$ 75,000$ 156,000$ 108.0%
EXPENDITURES
Operating Transfers - - - - - ---
TOTAL EXPENDITURES -$ -$ -$ -$ -$ ---
FUND BALANCE - JANUARY 1 456,048$ 613,649$ 791,698$ 791,698$ 866,698$
Excess (Deficiency) of
Revenues over Expenditures 157,601 178,049 75,000 75,000 156,000
FUND BALANCE - DECEMBER 31 613,649$ 791,698$ 866,698$ 866,698$ 1,022,698$
191
PARK & PATHWAY DEDICATION FUND
DEPARTMENT: Recreation & Culture SUPERVISOR: Parks Superintendent FUND #: 404 ACTIVITY #: 45202
ACTIVITY SCOPE:
Activities of the Park and Pathway Dedication Fund include updating and maintaining the city's
pathway system, as well as designating funds for future city parks and pathways.
OBJECTIVES:
1.Improve pathways and parks systems.
2.Development of Bertram Chain of Lakes Park.
ISSUES:
1.Economic impact on new development and home construction.
2.Time constraints of other projects.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
Park dedication fees are an irregular source of revenue because of unpredictable economic
conditions and sporadic new development. Transfers from other funds typically surpasses all
other revenue sources. When possible, the city transfers money into this fund prior to the year
of expenditure.
The 2021 budgeted expenditures include trail construction on Fenning Avenue ($300,000),
CSAH 39 ($400,000), and East Bertram Chain of Lakes ($50,000).
Measurement 2018 2019 2020 2021
Projects supported 2 4 4 4
Dedication fees*18,997$ -$ -$ -$
*Land may be donated by developer in lieu of paying a park dedication fee.
192
BUDGET:
PARK & PATHWAY DEDICATION 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 18,997$ -$ -$ -$ -$ ---
Miscellaneous 10,688 88,819 47,000 47,000 47,000 0.0%
Operating Transfers 400,000 2,100,000 420,000 420,000 1,094,000 160.5%
TOTAL REVENUES 429,685$ 2,188,819$ 467,000$ 467,000$ 1,141,000$ 144.3%
EXPENDITURES
Other Services & Charges 12,185 28,016 - - - ---
Capital Outlay 229,137 1,917,927 515,000 515,000 750,000 45.6%
TOTAL EXPENDITURES 241,322$ 1,945,943$ 515,000$ 515,000$ 750,000$ 45.6%
FUND BALANCE - JANUARY 1 508,102$ 696,465$ 939,341$ 939,341$ 891,341$
Excess (Deficiency) of
Revenues over Expenditures 188,363 242,876 (48,000) (48,000) 391,000
FUND BALANCE - DECEMBER 31 696,465$ 939,341$ 891,341$ 891,341$ 1,282,341$
193
STORMWATER ACCESS FUND
DEPARTMENT: Public Works SUPERVISOR: City Engineer/Public Works Director FUND #: 263 ACTIVITY #: 49201
ACTIVITY SCOPE:
The Stormwater Access Fund was closed into the Stormwater enterprise fund in 2019.
OBJECTIVES:
1.None.
ISSUES:
1.None.
MEASURABLE WORKLOAD DATA:
See the Stormwater enterprise Fund
BUDGET COMMENTARY:
See the Stormwater enterprise Fund.
BUDGET:
STORMWATER ACCESS FUND 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 101,363$ 159,779$ -$ -$ -$ ---
Miscellaneous 15,899 44,631 - - - ---
TOTAL REVENUES 117,262$ 239,486$ -$ -$ -$ ---
EXPENDITURES
Other Services & Charges 214 171,604 - - - ---
Operating Transfers - 1,426,818 - - - ---
TOTAL EXPENDITURES 214$ 1,598,422$ -$ -$ -$ ---
FUND BALANCE - JANUARY 1 1,241,888$ 1,358,936$ -$ -$ -$
Excess (Deficiency) of
Revenues over Expenditures 117,048 (1,358,936) - - -
FUND BALANCE - DECEMBER 31 1,358,936$ -$ -$ -$ -$
194
STREET LIGHTING IMPROVEMENT FUND
DEPARTMENT: Public Works SUPERVISOR: City Engineer/Public Works Director FUND #: 403 ACTIVITY #: 43162
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 and Xcel Energy.
3.Verify lamp and fixture maintenance by utility companies.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
Electric franchise fees provide resources for lighting projects, often in conjunction with other
street improvement projects. Capital outlays for 2020 include $100,000 for street re-lighting
projects.
Measurement 2018 2019 2020 2021
Projects supported 3 2 0 1
195
BUDGET:
STREET LIGHT IMPROVEMENTS 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Franchise & Other Taxes 122,259$ 165,923$ 80,000$ 80,000$ 90,000$ 12.5%
Miscellaneous 16,228 23,783 10,000 10,000 10,000 0.0%
TOTAL REVENUES 138,487$ 189,706$ 90,000$ 90,000$ 100,000$ 11.1%
EXPENDITURES
Capital Outlay 378,874 3,787 160,000 160,000 100,000 -37.5%
TOTAL EXPENDITURES $378,874 $3,787 $160,000 $160,000 $100,000 -37.5%
FUND BALANCE - JANUARY 1 842,972$ 602,585$ 788,504$ 788,504$ 718,504$
Excess (Deficiency) of
Revenues over Expenditures (240,387) 185,919 (70,000) (70,000) -
FUND BALANCE - DECEMBER 31 602,585$ 788,504$ 718,504$ 718,504$ 718,504$
196
STREET RECONSTRUCTION FUND
DEPARTMENT: Public Works SUPERVISOR: City Engineer/Public Works Director FUND #: 212 ACTIVITY #: 43121
ACTIVITY SCOPE:
The Street Reconstruction Fund was established to track annual improvements to city
infrastructure. The fund has not been utilized in years, so it is being repurposed to the Central
Equipment Fund in 2021.
OBJECTIVES:
1.Transfer balance to Central Equipment Fund.
ISSUES:
1.None.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
Past revenue sources have included property taxes and operating transfers from the Liquor
Fund. Neither the tax nor transfer has been budgeted in years. Prior operating transfers in the
budget schedule below were to a debt service fund for bonds that are now paid off.
BUDGET:
Measurement 2018 2019 2020 2021
Not Applicable
STREET RECONSTRUCTION 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Miscellaneous 19,574$ 57,409$ 20,000$ 20,230$ -$ -100.0%
TOTAL REVENUES 19,574$ 57,409$ 20,000$ 20,230$ -$ -100.0%
EXPE NDITURES
Operating Transfers 44,899 135,000 - - 1,654,000 ---
TOTAL EXPENDITURES 44,899$ 135,000$ -$ -$ 1,654,000$ ---
FUND BA LANCE - JANUARY 1 1,736,686$ 1,711,361$ 1,633,770$ 1,633,770$ 1,654,000$
Excess (Deficiency) of
Revenues over Expenditures (25,325) (77,591) 20,000 20,230 (1,654,000)
FUND BALANCE - DECEMBER 31 1,711,361$ 1,633,770$ 1,653,770$ 1,654,000$ -$
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ENTERPRISE FUNDS
Adopted 2021
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, Sewage,
Stormwater, Liquor (Hi-Way Liquors), Deputy Registrar (DMV), and Fiber Optics (FiberNet).
BUDGET ISSUES
Each enterprise fund has specific challenges that will be addressed in the narrative for each
fund.
BUDGET SUMMARY
TOTAL ENTERPRISE FUNDS 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Sale of Goods 6,086,293$ 6,374,153$ 6,264,651$ 6,264,651$ 6,679,000$ 6.6%
Licenses & Permits 3,210 3,255 2,000 2,000 2,000 0.0%
Charges for Services 7,198,440 6,310,416 6,529,760 6,529,760 7,064,112 8.2%
Special Assessments 26,011 19,256 38,000 38,000 38,000 0.0%
Miscellaneous 195,488 637,258 90,100 90,100 96,100 6.7%
Contributed Capital 914,666 1,457,482 339,788 339,788 339,788 0.0%
Operating Transfers 130,000 1,426,818 50,000 50,000 200,000 300.0%
Debt Proceeds (16,549) - - - - ---
TOTAL REVENUES 14,537,559$ 16,228,638$ 13,314,299$ 13,314,299$ 14,419,000$ 8.3%
EXPENDITURES
Personnel Services 1,593,078$ 1,663,246$ 1,897,654$ 1,897,654$ 2,027,951$ 6.9%
Supplies 4,968,285 5,090,456 5,235,252 5,235,252 5,449,799 4.1%
Other Services & Charges 4,716,567 3,668,174 3,861,388 3,861,388 3,697,624 -4.2%
Capital Outlay 564,220 98,214 2,000,000 2,000,000 3,738,000 86.9%
Debt Service 368,274 364,106 365,532 365,532 366,626 0.3%
Operating Transfers 1,130,000 4,233,000 1,370,000 1,835,000 325,000 -76.3%
TOTAL EXPENDITURES 13,340,424$ 15,117,196$ 14,729,826$ 15,194,826$ 15,605,000$ 5.9%
FUND BALANCE - JANUARY 1 12,920,435$ 14,117,570$ 15,229,012$ 15,229,012$ 13,348,485$
Excess (Deficiency) of
Revenues over Expenditures 1,197,135 1,111,442 (1,415,527) (1,880,527) (1,186,000)
FUND BALANCE - DECEMBER 31 14,117,570$ 15,229,012$ 13,813,485$ 13,348,485$ 12,162,485$
199
WATER FUND
DEPARTMENT: Public Works SUPERVISOR: Utilities Superintendent FUND #: 601 ACTIVITY #: 49440 & 49441
ACTIVITY SCOPE:
The Water Fund is a self-sustaining city utility fund. 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 it is bacteria-free. Further,
metering equipment is maintained to account for accurate usage and billing.
OBJECTIVES:
1. Continue to add GPS data point to GIS system.
2. Improve well head protection program.
3. Advance installation of radio reading devices on water meters.
ISSUES:
1. Additional state and federal regulations.
2. Aging water control system (SCADA).
3. Project demands on staff.
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Water customers 4,341 4,396 4,458 4,600
Meters read 52,092 52,752 53,496 55,200
Meters replaced 64 45 52 50
New meters installed 81 43 62 50
Water locates* 300 2,404 2,018 2,500
Gallons pumped (MG)592 512 601 550
Valves maintained 401 447 120 202
Hydrants maintained 172 428 153 175
Times mains flushed 2 2 2 2
Mains/wells rebuilt 2 0 2 2
Water towers inspections 2 2 1 2
Reservoir inspections 0 0 1 1
Water samples to sent 190 186 190 190
Radio units installed 584 368 125 500
Service shut-offs 150 43 25 100
*Water locates were being combined with Fiber locates and not counted separately
prior to 2019.
200
BUDGET COMMENTARY:
The Water Fund’s main source of revenue is user charges. Rates increase 10% for the base
charge and 5% for usage charge in 2021.
Capital outlays in 2021 are for a SCADA system upgrade. The 2021 personnel services budget
includes a full step increase and a 2.5% market rate wage adjustment. Other services & charges
increase due to additional engineering services and anticipated repairs and maintenance
needed on equipment. The 2018-2020 transfers out will be used to acquire land for the next
public works building site.
BUDGET:
WATER FUND 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Licenses & Permits 3,210$ 3,255$ 2,000$ 2,000$ 2,000$ 0.0%
Charges for Services 1,349,647 1,232,207 1,348,539 1,348,539 1,424,400 5.6%
Special Assessments 26,011 19,256 38,000 38,000 38,000 0.0%
Miscellaneous 87,644 223,191 55,600 55,600 55,600 0.0%
Contributed Capital 299,628 399,466 80,000 80,000 80,000 0.0%
Debt Proceeds (16,549) - - - - ---
TOTAL REVENUES 1,749,591$ 1,877,375$ 1,524,139$ 1,524,139$ 1,600,000$ 5.0%
EXPENDITURES
Personnel Services 255,694$ 269,252$ 341,491$ 341,491$ 372,229$ 9.0%
Supplies 168,350 153,007 221,650 221,650 221,650 0.0%
Other Services & Charges 295,341 267,713 422,181 422,181 491,121 16.3%
Capital Outlay 299,768 98,214 650,000 650,000 850,000 30.8%
Operating Transfers 600,000 1,533,000 900,000 900,000 - -100.0%
TOTAL EXPENDITURES 1,619,153$ 2,321,186$ 2,535,322$ 2,535,322$ 1,935,000$ -23.7%
FUND BALANCE - JANUARY 1 5,341,438$ 5,471,876$ 5,028,065$ 5,028,065$ 4,016,882$
Excess (Deficiency) of
Revenues over Expenditures 130,438 (443,811) (1,011,183) (1,011,183) (335,000)
FUND BALANCE - DECEMBER 31 5,471,876$ 5,028,065$ 4,016,882$ 4,016,882$ 3,681,882$
201
SEWAGE FUND
DEPARTMENT: Public Works SUPERVISOR: Utilities Superintendent FUND #: 602 ACTIVITY #: 49480, 49490 & 49491
ACTIVITY SCOPE:
The Sewage Fund is a self-sustaining city utility fund. The Sewage 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. Continue to add GPS data points to GIS system.
2. Research alternative waste disposal options, including costs.
3. Advance long-range planning regarding plant capacity and expansion.
4. Monitor infiltration of ground water into the sanitary sewer system.
ISSUES:
1. Treatment plant is nearing capacity.
2. Aging of control system (SCADA) and other assets.
3. Ground water infiltration.
4. Cost of treatment alternatives.
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Collection
Sewer mains maintained 20 Miles 25 Miles 28 Miles 28 Miles
Liftstations 7 7 7 7
Sewer main locates*300 2,404 2,018 2,500
Manholes maintained**400 728 344 400
New service hookups 78 42 62 50
Treatment
Screw press influent flow (gals)6,540,105 6,596,750 6,500,000 6,500,000
Thickened sludge (wet tons)2,115 2,145 2,100 2,100
Thickened sludge (dry tons)333 336 325 325
Dry ton % of wet ton 15.7% 15.7% 15.5% 15.5%
Raw influent flow (million gals)434 473 450 450
*Sewer locates were being combined with Fiber locates and not counted separately
prior to 2019.
** Manholes are maintained by quadrants. Fewer manholes in one quadrant allows
more time for cleaning longer main sewer lines.
202
BUDGET COMMENTARY:
The Sewage Fund’s main source of revenue is user charges. Rates increase 10% for the base
charge and 5% for usage charge in 2021. Operating transfers in were budgeted to the sewer
access charges sub-fund to replenish use of charges for debt service in prior years.
The 2021 personnel services budget includes a full step increase and a 2.5% market rate wage
adjustment. The city renewed its contract with a third-party provider of wastewater treatment
plant management services for five years starting in 2018. Capital outlays in 2021 include
$930,000 for a SCADA upgrade and $375,000 for sewer line improvements and maintenance.
Other budget items are expected to remain close to prior year levels.
BUDGET:
SEWAGE FUND 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 3,430,411$ 2,442,974$ 2,551,721$ 2,551,721$ 2,695,212$ 5.6%
Miscellaneous 52,459 117,101 25,000 25,000 25,000 0.0%
Contributed Capital 615,038 1,058,016 199,788 199,788 199,788 0.0%
Operating Transfers - - - - 200,000 ---
Debt Proceeds - - - - - ---
TOTAL REVENUES 4,097,908$ 3,618,091$ 2,776,509$ 2,776,509$ 3,120,000$ 12.4%
EXPENDITURES
Personnel Services 328,965$ 358,413$ 360,071$ 360,071$ 384,021$ 6.7%
Supplies 131,864 127,552 160,000 160,000 173,500 8.4%
Other Services & Charges 2,395,154 1,187,303 1,240,533 1,240,533 1,274,853 2.8%
Capital Outlay 264,452 - 1,225,000 1,225,000 1,680,000 37.1%
Debt Service 368,274 364,106 365,532 365,532 366,626 0.3%
Operating Transfers - 600,000 - - - ---
TOTAL EXPENDITURES 3,488,709$ 2,637,374$ 3,351,136$ 3,351,136$ 3,879,000$ 15.8%
FUND BALANCE - JANUARY 1 4,308,695$ 4,917,894$ 5,898,611$ 5,898,611$ 5,323,984$
Excess (Deficiency) of
Revenues over Expenditures 609,199 980,717 (574,627) (574,627) (759,000)
FUND BALANCE - DECEMBER 31 4,917,894$ 5,898,611$ 5,323,984$ 5,323,984$ 4,564,984$
203
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. The waste disposal biosolids site was abandoned in 2014
when new screw press technology was installed.
Year Service Change $Change %
2012 544,789$
2013 562,361$ 17,572$ 3.2%
2014 585,096$ 22,735$ 4.0%
2015 582,360$ (2,736)$ -0.5%
2016 582,360$ -$ 0.0%
2017 593,196$ 10,836$ 1.9%
2018 563,400$ (29,796)$ -5.0%
2019 577,476$ 14,076$ 2.5%
2020 591,913$ 14,437$ 2.5%
2021 606,711$ 14,798$ 2.5%
2022 624,879$ 18,168$ 3.0%
Schedule of Non-Reimbursables (O&M Services)
$-
$100
$200
$300
$400
$500
$600
$700
20122013201420152016201720182019202020212022ThousandsO&M Services Costs
Year R&M Polymer Hauling Landfill Electricity Gas Total
2012 91,406$ 16,304$ -$ -$ 145,043$ 36,723$ 289,476$
2013 89,620 17,453 - - 170,538 46,498 324,109
2014 57,884 62,736 32,949 33,237 160,826 68,417 416,049
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* 60,000 - 44,000 52,000 - - 156,000
2021* 55,500 - 37,200 51,300 - - 144,000
*Budgeted
Schedule of Reimbursable Costs
$-
$100
$200
$300
$400
$500
2012 2013 2014 2015 2016 2017 2018 2019 2020*2021*ThousandsReimbursable Costs 2012-2021
R&M Polymer Hauling Landfill Electricity Gas
204
REMAINING DEBT SERVICE:
The optional redemption date on these bonds is December 1, 2021.
Payable Principal Interest Rate Total
6/1/2021 -$ 24,299$ 24,299$
12/1/2021 195,000 24,299 2.15% 219,299
6/1/2022 - 22,203 22,203
12/1/2022 200,000 22,203 2.35% 222,203
6/1/2023 - 19,853 19,853
12/1/2023 205,000 19,853 2.60% 224,853
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 1,720,000$ 241,273$ 1,961,273$
GO Wastewater Treatment Bonds, Series 2013B
Payable Principal Interest Rate Total
2/20/2021 -$ 9,014$ 9,014$
8/20/2021 105,000 9,014 1.06% 114,014
2/20/2022 - 8,456 8,456
8/20/2022 106,000 8,456 1.06% 114,456
2/20/2023 - 7,893 7,893
8/20/2023 107,000 7,893 1.06% 114,893
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 1,696,000$ 147,810$ 1,843,810$
MPFA-15-0004-R-FY16
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STORMWATER FUND
DEPARTMENT: Public Works SUPERVISOR: Utilities Superintendent FUND #: 652 ACTIVITY #: 49481, 49482 & 49483
ACTIVITY SCOPE:
The Stormwater, established in 2019, is a self-sustaining city utility fund. The streets and
engineering department manages the water quality utility, which includes street sweeping,
MS4 management, storm sewer televising and cleaning, pond maintenance, and system
enhancements. These operations were previously accounted for in the stormwater activity in
the General Fund. Fees are based on 1 drainage unit per residence and 7 drainage units per
impervious acre for non-residential properties.
OBJECTIVES:
1.Monitor, repair, and clean storm water 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:
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. The fee was established in July 2019. The fee increases to $3 per
drainage unit per month for 2021. Miscellaneous revenues increase with a higher allocation of
interest earnings due to the fund’s cash balance.
Measurement 2018 2019 2020 2021
Stormwa ter main miles 72 72.5 73.0 73.0
Number of manholes 1,613 1,645 1,655 1,655
Number of ponds 107 107 109 109
Number of outfalls 31 31 31 31
Number of stormwater BMPS 47 49 50 50
Gopher 1 utility locates 1,892 2,404 2,018 2,100
*2018 & 2019 activity was accounted for in the General Fund.
206
Personnel services consists of allocated wages from staff in the streets and engineering
departments. Other services & charges include engineering fees and licenses & permits. Capital
outlay consists of expenditures for stormwater improvements.
BUDGET:
STORMWATER FUND 2018 2019 2020 2020 2021 %
REVENUES ACTUA L ACTUAL BUDGET PROJECTED B UDGET CHANGE
Charges for Services -$ 61,757$ 206,000$ 206,000$ 381,000$ 85.0%
Miscellaneous - 372 1,000 1,000 7,000 600.0%
Contributed Capital - -60,000 60,000 60,000 0.0%
Operating Transfers - 1,426,818 - - - ---
TOTAL REVENUES -$ 1,488,947$ 267,000$ 267,000$ 448,000$ 67.8%
EXPENDITURES
Personnel Services -$ -$ 93,374$ 93,374$ 107,055$ 14.7%
Supplies - - 18,250 18,250 21,000 15.1%
Other Services & Charges - - 6,389 6,389 29,945 368.7%
Capital Outlay - - 50,000 50,000 700,000 1300.0%
TOTAL EXPENDITURES - - 168,013 168,013 858,000 410.7%
FUND BALANCE - JANUARY 1 -$ -$ 1,488,947$ 1,488,947$ 1,587,934$
Excess (Deficiency) of
Revenues over Expenditures - 1,488,947 98,987 98,987 (410,000)
FUND BALANCE - DECEMBER 31 -$ 1,488,947$ 1,587,934$ 1,587,934$ 1,177,934$
207
LIQUOR FUND
DEPARTMENT: Liquor Fund SUPERVISOR: Liquor Store Manager/Finance Director FUND #: 609 ACTIVITY #: 49750 & 49754
ACTIVITY SCOPE:
The Liquor Fund provides customers with the opportunity to purchase alcohol and other
related products. Profits from store operations are used to support other city funds and
activities.
OBJECTIVES:
1.Match product selection to changes in demand.
2.Enhance alcohol training program for all liquor store employees.
3.Elevate store attractiveness through customer focused improvements.
4.Boost sales to existing customers.
5.Increase sales per transaction.
6.Improve gross profit margin [1 – (cost/price)].
7.Grow customer base and sales by aggressively marketing the store.
ISSUES:
1.Promote and control the safe and responsible sale of alcohol.
2.Competitive pricing.
3.Staff turnover.
4.Proposed legislative action to allow liquor sales in retail stores, thereby causing
more competition.
5.Balancing sharp increase in demand during COVID-19 with staffing levels and
physical space of the store.
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Gross profit 1,539,546$ 1,674,968$ 1,922,503$ 1,725,000$
Gross profit % of sales 25% 26% 26%26%
Sales per square foot $691 $724 $842 $795
Wine tasting tickets sold*105 ---
Total number of sales 261,071 267,273 260,957 265,000
Staff hours worked 22,318 23,800 21,828 22,000
Sales per hour worked 11.7 11.2 12.0 12.0
Average sale (including tax)$25.59 $26.19 $31.19 $30.00
* The liquor store elimiated wine tasting events in 2019.
208
BUDGET COMMENTARY:
Hi-Way Liquors is a profitable city enterprise fund, with excess cash directed toward special
projects or other needs. Revenues are generated by the sale of alcoholic beverages and liquor-
industry related merchandise.
In 2018, the Liquor Fund transferred $400,000 to the Park & Pathway Fund and $130,000 to the
Fiber Optics Fund. The 2019 transfers out include $2,100,000 to the Parks and Pathway Fund
for Bertram park development. The 2020 projected transfers out include $235,000 to the Parks
and Pathway Fund for installation of a turn lane on Briarwood by Bertram Chain of Lakes
Regional Park and $425,000 to the Community Center Fund for roof repairs and operating
shortfalls as a result of the COVID-19 pandemic.
The 2021 personnel services budget includes a full step increase and a 2.5% market rate wage
increase. Starting in 2018, an increase was budgeted in personnel services for extra staffing for
Sunday sales, which began in July 2017. Budgeted revenues are conservatively estimated.
BUDGET:
LIQUOR FUND 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Sale of Goods 6,086,293$ 6,374,153$ 6,264,651$ 6,264,651$ 6,679,000$ 6.6%
Miscellaneous 25,028 55,089 5,000 5,000 5,000 0.0%
TOTAL REVENUES 6,111,321$ 6,429,242$ 6,269,651$ 6,269,651$ 6,684,000$ 6.6%
EXPENDITURES
Personnel Services 626,298$ 625,051$ 680,614$ 680,614$ 701,811$ 3.1%
Supplies 4,547,304 4,719,040 4,691,052 4,691,052 4,923,749 5.0%
Other Services & Charges 222,669 257,521 242,875 242,875 258,440 6.4%
Capital Outlay - - 75,000 75,000 50,000 -33.3%
Operating Transfers 530,000 2,100,000 470,000 935,000 325,000 -30.9%
TOTAL EXPENDITURES 5,926,271$ 7,701,612$ 6,159,541$ 6,624,541$ 6,259,000$ 1.6%
FUND BALANCE - JANUARY 1 1,871,630$ 2,056,680$ 784,310$ 784,310$ 429,420$
Excess (Deficiency) of
Revenues over Expenditures 185,050 (1,272,370) 110,110 (354,890) 425,000$
FUND BALANCE - DECEMBER 31 2,056,680$ 784,310$ 894,420$ 429,420$ 854,420$
209
DEPUTY REGISTRAR FUND
DEPARTMENT: Deputy Registrar (DMV) SUPERVISOR: DMV Manager/Finance Director FUND #: 653 ACTIVITY #: 41990
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. The Monticello DMV is temporarily allowed to process license renewals due to
processing needs during the COVID-19 pandemic.
OBJECTIVES:
1.Market DMV services to public and dealerships.
2.Expand and improve customer service.
3.Update employee training and certifications.
ISSUES:
1.Changes to state licensing regulations.
2.Availability/limitations of state portal for license processing (MNLARS).
3.Providing services with little or no revenue.
4.Competition with other customer options: Other DMVs, on-line, and mail-in.
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Outcome/Effectiveness:
License Revenue $693,862 $787,658 $800,666 $825,000
Revenue per staff hour $50.87 $48.57 $49.51 $50.93
Net revenue per staff hour $19.09 $20.53 $18.55 $18.95
Efficiency:
Transactions per hour 8.8 8.6 7.9 8.4
Work Load:
Total transactions 119,543 139,965 127,128 136,400
Motor vehicle transactions 110,574 129,825 115,466 125,000
DNR transactions 7,009 8,148 8,424 8,500
Game & Fish transactions 549 709 311 400
Driver's license transactions 1,411 1,283 2,927 2,500
Staff hours 13,640 16,218 16,172 16,200
Dealerships serviced 28 30 32 32
210
BUDGET COMMENTARY:
The main revenue source for the DMV is the fees charged for the issuance of various licenses.
The 2021 personnel services budget includes a full step increase and a 2.5% market rate wage
adjustment. Revenue by service type: DNR licenses = $2-$7; game & fish licenses = $1; driver’s
licenses = $8; motor vehicle transactions = $6-$10. Revenues are always estimated
conservatively.
BUDGET:
DEPUTY REGISTRAR 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 692,217$ 788,032$ 625,500$ 625,500$ 700,500$ 12.0%
Miscellaneous 17,063 215,257 1,500 1,500 1,500 0.0%
TOTAL REVENUES 709,280$ 1,003,289$ 627,000$ 627,000$ 702,000$ 12.0%
EXPENDITURES
Personnel Services 381,916$ 410,286$ 415,804$ 415,804$ 456,535$ 9.8%
Supplies 9,364 9,936 9,300 9,300 9,900 6.5%
Other Services & Charges 37,244 46,277 36,710 36,710 53,565 45.9%
Capital Outlay - - - - 125,000 ---
TOTAL EXPENDITURES 428,524$ 466,499$ 461,814$ 461,814$ 645,000$ 39.7%
FUND BALANCE - JANUARY 1 990,502$ 1,271,258$ 1,808,048$ 1,808,048$ 1,973,234$
Excess (Deficiency) of
Revenues over Expenditures 280,756 536,790 165,186 165,186 57,000
FUND BALANCE - DECEMBER 31 1,271,258$ 1,808,048$ 1,973,234$ 1,973,234$ 2,030,234$
211
FIBER OPTICS FUND
DEPARTMENT: Fiber Optics Fund SUPERVISOR: City Administrator FUND #: 656 ACTIVITY #: 49870 & 49877
ACTIVITY SCOPE:
As with all enterprise funds, the goal of the Fiber Optics Fund is to become a self-sustaining
enterprise. 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.
3. Minimize subsidy from other funds.
ISSUES:
1. Competition from other service providers.
2. Industry trends (cord cutting, etc.).
3. Various legal aspects of operating a telecommunication business.
MEASURABLE WORKLOAD DATA:
BUDGET COMMENTARY:
The Fiber Optics Fund began operations in 2009, and construction of the fiber optic network
was completed in 2010. Revenues come from charges to subscribers, and expenditures are
incurred in operating the system and by new customer service installations. The city defaulted
on the revenue bonds used to finance construction of the system. Judgment bonds were issued
in 2014 to finance the settlement with revenue bondholders. Property taxes are levied to
support debt service on judgment bonds. There is no current debt service recorded in the Fiber
Optics Fund.
Measurement 2018 2019 2020 2021
Internet subscibers 1,544 1,631 1,801 1,900
Phone subscribers 386 354 315 300
Cable TV subscribers 458 385 323 275
212
In 2012, the city transferred $4,450,000 to the fund, eliminating the interfund loan balance. In
2013, the Liquor Fund and other city funds transferred $860,000 into the Fiber Optics Fund. In
years 2014 through 2019, the Liquor Fund provided $1,710,000 for Fiber Optics operations. By
the end of 2019, Fibernet operations and debt service had consumed a total of $8,876,892, not
including debt service on the 2014A settlement bonds. The Liquor Fund contributed $5,610,000
of the $7,020,000 total transfers to the Fiber Optics Fund since 2012.
Personnel services (employee costs) were eliminated in July of 2016 with the outsourcing of
operations to a third party. There are some minor employee costs still allocated the fund. The
2021 budget includes $333,000 in capital outlay for system improvements to new service areas.
BUDGET:
FIBER OPTICS 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 1,726,165$ 1,785,446$ 1,798,000$ 1,798,000$ 1,863,000$ 3.6%
Miscellaneous 13,294 26,248 2,000 2,000 2,000 0.0%
Operating Transfers 130,000 - 50,000 50,000 - -100.0%
TOTAL REVENUES 1,869,459$ 1,811,694$ 1,850,000$ 1,850,000$ 1,865,000$ 0.8%
EXPENDITURES
Personnel Services 205$ 244$ 6,300$ 6,300$ 6,300$ 0.0%
Supplies 111,403 80,921 135,000 135,000 100,000 -25.9%
Other Services & Charges 1,766,159 1,909,360 1,912,700 1,912,700 1,589,700 -16.9%
Capital Outlay - - - - 333,000 ---
TOTAL EXPENDITURES 1,877,767$ 1,990,525$ 2,054,000$ 2,054,000$ 2,029,000$ -1.2%
FUND BALANCE - JANUARY 1 408,170$ 399,862$ 221,031$ 221,031$ 17,031$
Excess (Deficiency) of
Revenues over Expenditures (8,308) (178,831) (204,000) (204,000) (164,000)
FUND BALANCE - DECEMBER 31 399,862$ 221,031$ 17,031$ 17,031$ (146,969)$
213
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214
ENTERPRISE FUNDS
For Fiscal Year 2013
Adopted 2021
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 will be 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 ISSUES
Each internal service fund has specific challenges that will be addressed in the narrative for each fund.
BUDGET SUMMARY
TOTAL INTERNAL SERVICE 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 551,522$ 571,210$ 575,300$ 589,300$ 697,100$ 21.2%
Miscellaneous 9,941 39,208 4,097 7,097 9,900 141.6%
Operating Transfers 300,000 200,000 - - 560,000 ---
TOTAL REVENUES 861,463$ 810,418$ 579,397$ 596,397$ 1,267,000$ 118.7%
EXPENDITURES
Personnel Services 25,899$ 29,841$ -$ -$ 58,000$ ---
Supplies 31,282 16,147 35,200 35,200 13,700 -61.1%
Other Services & Charges 135,705 126,928 167,300 167,300 174,800 4.5%
Capital Outlay 176,236 193,494 524,500 524,500 939,500 79.1%
Debt Service 133,485 131,477 134,400 134,400 67,000 -50.1%
Operating Transfers 200,000 - - - - ---
TOTAL EXPENDITURES 702,607$ 497,887$ 861,400$ 861,400$ 1,253,000$ 45.5%
FUND BALANCE - JANUARY 1 928,158$ 1,087,014$ 1,399,545$ 1,399,545$ 1,134,542$
Excess (Deficiency) of
Revenues over Expenditures 158,856 312,531 (282,003) (265,003) 14,000
FUND BALANCE - DECEMBER 31 1,087,014$ 1,399,545$ 1,117,542$ 1,134,542$ 1,148,542$
215
FACILITIES MAINTENANCE FUND
DEPARTMENT: Public Works
SUPERVISOR: Public Works Director
FUND #: 701
ACTIVITY #: XXXXX
ACTIVITY SCOPE:
The Facilities Maintenance Fund is a self-sustaining internal service fund. Once operational, 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:
BUDGET COMMENTARY:
The Facilities Maintenance Fund’s main source of revenue is internal user charges and accounts
for all activity supporting the city’s facilities, including the Community Center/City Hall, Public
Works, Hi-Way Liquors, the DMV, Prairie Center building, and Library.
Measurement 2018 2019 2020 2021
Data under development
216
BUDGET:
FACILITIES MAINTENANCE 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services -$ -$ -$ -$ 292,000$ ---
TOTAL REVENUES -$ -$ -$ -$ 292,000$ ---
EXPENDITURES
Personnel Services -$ -$ -$ -$ 203,772$ ---
Supplies - - - - 38,000 ---
Other Services & Charges - - - - 50,228 ---
TOTAL EXPENDITURES -$ -$ -$ -$ 292,000$ ---
FUND BALANCE - JANUARY 1 -$ -$ -$ -$ -$
Excess (Deficiency) of
Revenues over Expenditures - - - - -
FUND BALANCE - DECEMBER 31 -$ -$ -$ -$ -$
217
DEPARTMENT: Finance
SUPERVISOR: Finance Director
FUND #: 702
ACTIVITY #: XXXXX
ACTIVITY SCOPE:
The IT (Information Technology) Services Fund is a self-sustaining internal service fund. The
finance department 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 provision of information technology services into one fund.
2.Improve management of IT resources.
3.Distribute capital costs over multiple annual reporting periods.
4.Provide financial management stability to each budget unit.
ISSUES:
1.Appropriate costs distribution.
2.Coordination of service delivery to multiple departments and budget units.
3.Demands on staff.
MEASURABLE WORKLOAD DATA:
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, PCs, printers, copiers, phones, and professional services. The city is planning to
add an internal staff position in the IT department in 2021. Additional devices were purchased
in 2020 due to the Federal CARES Act grant providing a funding source for upgrading the city’s
IT environment with the need to telework during the COVID-19 pandemic. Therefore, the
budget allocated to the new position came from supplies and capital outlay.
Measurement 2018 2019 2020 2021
Work Load:
Number of clients/users 87 94 91 91
Number of PC, servers, and
network devices 180 162 122 122
218
IT SERVICES FUND
BUDGET:
IT SERVICES 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 272,902$ 249,200$ 225,000$ 225,000$ 244,500$ 8.7%
Miscellaneous 3,911 7,084 1,097 1,097 3,500 219.1%
TOTAL REVENUES 276,813$ 256,284$ 226,097$ 226,097$ 248,000$ 9.7%
EXPENDITURES
Personnel Services -$ -$ -$ -$ 42,000$ ---
Supplies 31,282 16,147 35,200 35,200 13,700 -61.1%
Other Services & Charges 135,705 126,928 167,300 167,300 174,800 4.5%
Capital Outlay 11,982 7,468 22,500 22,500 17,500 -22.2%
Operating Transfers 200,000 - - - - ---
TOTAL EXPENDITURES 378,969$ 150,543$ 225,000$ 225,000$ 248,000$ 10.2%
FUND BALANCE - JANUARY 1 276,816$ 174,660$ 280,401$ 280,401$ 281,498$
Excess (Deficiency) of
Revenues over Expenditures (102,156) 105,741 1,097 1,097 -
FUND BALANCE - DECEMBER 31 174,660$ 280,401$ 281,498$ 281,498$ 281,498$
219
DEPARTMENT: Finance
SUPERVISOR: Finance Director
FUND #: 703
ACTIVITY #: XXXXX
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 predetermined 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.Build mechanism for replacing capital assets into annual budgets.
2.Improve management of capital assets.
3.Distribute capital costs over multiple annual reporting periods.
4.Provide financial management stability to each budget unit.
ISSUES:
1.Appropriate cost distribution over multiple accounting periods.
2.Efficient coordination of asset replacement activities.
3.Adequate start-up resources.
4.Demands on staff.
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Outcome/Effectiveness:
Annual cost recovery 249,800$ 298,900$ 330,800$ 330,800$
Total costs of assets acquired 1,646,638$ 1,941,941$ 375,450$ 922,000$
Efficiency:
Cost recovery as % of
acquired assets 15% 15% 88%36%
Work Load:
Number of fund assets 27 31 36 45
220
CENTRAL EQUIPMENT FUND
BUDGET COMMENTARY:
The Central Equipment Fund’s main source of revenue is internal rental charges. The fund was
initiated near the beginning of 2013 with the sale of $500,000 in certificates of indebtedness.
The city also issued $515,000 in G.O. bonds in 2014 to finance the acquisition of a fire tender
and a plow truck. The 2021 operating transfers will come from the closure of the Streets
Reconstruction capital projects fund, which will help the fund with future equipment purchases.
The 2021 budgeted equipment acquisitions: [public works equipment] wheel loader - $260,000;
hook truck with plow - $275,000; one-ton truck - $65,000; box sander - $23,000; one-ton truck
with dump - $80,000; [recreation equipment] top dresser - $20,000; tractor - $49,000; skid
loader - $75,000; [public safety] squad truck - $75,000.
BUDGET:
REMAINING DEBT SERVICE:
The early redemption date on these bonds is December 15, 2021.
CENTRAL EQUIPMENT FUND 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 249,800$ 298,900$ 330,800$ 330,800$ 436,600$ 32.0%
Miscellaneous 6,030 22,537 3,000 3,000 3,400 13.3%
Operating Transfers 300,000 200,000 - - 560,000 ---
TOTAL REVENUES 555,830$ 521,437$ 333,800$ 333,800$ 1,000,000$ 199.6%
EXPENDITURES
Capital Outlay 164,254 186,026 502,000 502,000 922,000 83.7%
Debt Service 133,485 131,477 134,400 134,400 67,000 -50.1%
TOTAL EXPENDITURES 297,739$ 317,503$ 636,400$ 636,400$ 989,000$ 55.4%
FUND BALANCE - JANUARY 1 393,703$ 651,794$ 855,728$ 855,728$ 553,128$
Excess (Deficiency) of
Revenues over Expenditures 258,091 203,934 (302,600) (302,600) 11,000
FUND BALANCE - DECEMBER 31 651,794$ 855,728$ 553,128$ 553,128$ 564,128$
Payable Principal Interest Rate Total
6/15/2021 -$ 3,360$ 3,360$
12/15/2021 60,000 3,360 2.50% 63,360
6/15/2022 - 2,610 2,610
12/15/2022 60,000 2,610 2.75% 62,610
6/15/2023 - 1,785 1,785
12/15/2023 60,000 1,785 2.90% 61,785
6/15/2024 - 915 915
12/15/2024 60,000 915 3.05% 60,915
Total 240,000$ 17,340$ 257,340$
GO Bonds, Series 2014A (Equipment Portion)
221
DEPARTMENT: Finance
SUPERVISOR: Finance Director
FUND #: 704
ACTIVITY #: XXXXX
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.Build mechanism for recording governmental fund liability for paid leaves.
2.Improve management of vacation, sick, and PTO leave.
3.Distribute accumulating paid leave costs to budget units.
4.Provide financial management stability to each budget unit.
ISSUES:
1.Increasing cost of paid leave benefits.
2.Stability of liability based on accumulation of additional leave.
MEASURABLE WORKLOAD DATA:
Measurement 2018 2019 2020 2021
Outcome/Effectiveness:
Annual hours accrued:
PTO 9,007 8,905 8,719 9,000
Vacation & Sick Leave 817 816 613 350
Balance of accrued hours:
PTO 7,828 7,949 9,134 8,500
Vacation & Sick Leave 2,669 2,770 1,907 675
Efficiency:
Annual hours accrued per employee:
PTO 170 175 156 180
Vacation & Sick Leave 272 272 204 175
Work Load:
Employees accruing hours:
PTO employees 53 51 56 50
Vacation & Sick Leave
employees (Pre-1990)3 3 3 2
222
BENEFIT ACCRUAL FUND
BUDGET COMMENTARY:
The Benefit Accrual Fund’s main source of revenue is internal charges to personnel services in
the city’s two main governmental funds: General Fund and Monticello Community Center 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 individual. Employees can
carry-over 320 hours of accrued PTO.
BUDGET:
BENEFIT ACCRUAL FUND 2018 2019 2020 2020 2021 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 28,820$ 23,110$ 19,500$ 33,500$ 16,000$ -17.9%
Miscellaneous - 9,587 - 3,000 3,000 ---
TOTAL REVENUES 28,820$ 32,697$ 19,500$ 36,500$ 19,000$ -2.6%
EXPENDITURES
Personnel Services 25,899$ 29,841$ -$ -$ 16,000$ ---
TOTAL EXPENDITURES 25,899$ 29,841$ -$ -$ 16,000$ ---
FUND BALANCE - JANUARY 1 257,639$ 260,560$ 263,416$ 263,416$ 299,916$
Excess (Deficiency) of
Revenues over Expenditures 2,921 2,856 19,500 36,500 3,000
FUND BALANCE - DECEMBER 31 260,560$ 263,416$ 282,916$ 299,916$ 302,916$
223
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ENTERPRISE FUNDS
For Fiscal Year 2013
Adopted 2021
APPENDIX
COMMUNITY, DEMOGRAPHIC, AND STATISTICAL INFORMATION
Classified 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 2010 U. S. Census estimated
Monticello's population at 12,759 and the city encompasses an area of 8.94 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 appropriating funds, setting
salaries, adopting ordinances, and approving the budget.
Monticello has a varied business community with a healthy mix of retail and manufacturing. The city
was hit hard by the recession in 2008-2010 but has slowly recovered. City unemployment rates are like
that of the state, but recently the state’s rate has been slightly lower, as shown below.
Home to one of the two state nuclear generation plants, Monticello’s largest employer is Xcel Energy.
Agri-giant Cargill also maintains a strong presence in the city.
Average Employment
Year Wright County Wright County State of Minnesota
2011 65,228 6.8%6.5%
2012 66,564 5.6%5.6%
2013 67,224 4.7%4.9%
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%
HISTORICAL EMPLOYMENT/UNEMPLOYMENT DATA
(Rates are not compiled for individual communities within counties)
Average Unemployment
Employer Employees
Xcel Energy (Northern States)600
ISD No. 882 (Monticello)576
CentraCare Health - Monticello 500
Cargill Kitchen Sol. (Sunny Fresh)350
Walmart Supercenter 300
City of Monticello 230
Home Depot 150
Target 150
Ultra Machining Corporation 140
Cub Foods 100
WSI Industries 100
TOP TEN CITY EMPLOYERS
225
Monticello’s population and households are 0.2% of state’s total for both measures. With a Walmart,
Target, Home Depot, 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 52% of the city’s net tax capacity. Xcel’s tax capacity and
the council’s conservative tax levy philosophy are the main reasons the city tax capacity rate is the
second lowest in Wright County. Upgrades to the Xcel plant in 2011 contributed to 15% decline in the
2013 tax capacity rate. Likewise, Xcel upgrades in 2013 produced a 20% decline in the 2015 tax rate. A
plant valuation decline contributed to a 2019 tax rate increase. The tax base is about one-third
residential and two-thirds commercial.
People QuickFacts Monticello Minnesota
Population, 2019 estimate July 1 13,824 5,639,632
Population, 2010 12,759 5,303,925
Population, percent change, April 1, 2010 to July 1, 2019 8.1% 6.3%
Persons under 5 years, percent 8.8% 6.2%
Persons under 18 years, percent 27.7% 23.1%
Persons 65 years and over, percent 11.7% 16.3%
Female persons, percent 51.2% 50.2%
White persons, percent 89.8% 83.8%
Total number of firms, 2012 1,132 489,494
Retail sales per capita, 2012 $26,746 $14,667
Land area in square miles, 2010 8.94 79,626.74
Persons per square mile, 2010 1,427.2 66.6
Housing units, 2019 X 2,477,753
Homeownership rate, 2015-2019 71.0% 71.6%
Median value of owner-occupied housing units, 2015-2019 $199,900 $223,900
Households, 2015-2019 5,092 2,185,603
Persons per household, 2015-2019 2.63 2.49
Per capita money income in the past 12 months, 2015-2019 $28,965 $37,625
Median household income, 2015-2019 $70,394 $71,306
2018 2019 2021 2021 2021-21 2021-21
City Tax Rate Tax Rate Tax Rate Tax Rate Change Change %
City of Otsego 36.556 36.060 35.099 34.607 -0.492 -1.4%
City of Monticello 32.333 34.262 34.967 35.680 0.713 2.0%
City of St. Michael 37.060 36.939 36.691 35.802 -0.889 -2.5%
City of Rockford 52.999 50.931 48.674 44.080 -4.594 -10.4%
City of Hanover 44.841 43.935 44.889 46.419 1.530 3.3%
City of Albertville 49.158 47.294 47.067 46.769 -0.298 -0.6%
City of Delano 53.980 53.399 52.913 49.307 -3.606 -7.3%
City of Dayton 55.664 55.212 54.139 51.089 -3.050 -6.0%
City of Montrose 57.213 56.457 50.952 51.489 0.537 1.0%
City of Buffalo 60.079 57.199 55.811 54.276 -1.535 -2.8%
City of Annandale 60.107 58.156 55.706 54.533 -1.173 -2.2%
City of Waverly 78.880 69.011 64.252 60.912 -3.340 -5.5%
City of Maple Lake 65.992 66.307 65.428 67.337 1.909 2.8%
City of Cokato 80.816 77.029 71.410 67.986 -3.424 -5.0%
City of Clearwater 74.272 71.144 72.662 69.527 -3.135 -4.5%
City of Howard Lake 68.520 70.532 70.889 72.390 1.501 2.1%
City of South Haven 132.047 113.063 105.298 94.279 -11.019 -11.7%
CITY TAX RATES IN WRIGHT COUNTY, MINNESOTA
226
Monticello grew by approximately 10% 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:
The above statistics reflect a more accurate Census count, which is the 2011 total. The other counts
are from the state demographer.
Year Population Change
2011 12,759 1,258
2012 12,840 81
2013 12,901 61
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
227
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 the levy will be paid by taxpayers. 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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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 2021
State Tax Payable 2021
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 2.00% (commercial-industrial rate)
Seasonal Recreational
1st $500,000 1.00% Subject to state levy
>$500,000 1.25% (commercial-industrial rate)
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TRUTH-IN-TAXATION (TNT)
TNT Summary Chart for Taxes Payable 2021
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.
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. (August 24, 2020)
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, but newspaper
publication of the minutes is not required.)
• 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. (August 24, 2020)
Nov. 11 to
Nov. 24
County auditor prepares and sends parcels specific notices.
Nov. 25 to
Dec. 28
City council holds meeting to discuss the budget and property tax levy and,
before a final determination, allows public input. (December 14, 2020)
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 14, 2020)
**The date an activity occurred is highlighted.
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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.
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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
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 of
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 commonly 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 street lights 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 communica-
tions 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.
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:
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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) improvements 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 as a result 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.
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?
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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 amount 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 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.
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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.
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.
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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.
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.
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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. 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.
(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.
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(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.
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.
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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
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.
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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
Residential & Commercial Water: 10, 12, 16, 17 & 11, 11NT & 11TX, 13, 90
0 - 1,000 gallons $7.81
1,001 - 10,000 gallons (9,000 gallons)$1.83/1,000 gallons
10,001 - 33,000 gallons (23,000 gallons)$2.12/1,000 gallons
33,001 gallons and over $2.32/1,000 gallons
Sprinklers - Res Twnhm & Commercial: 30, 31, 31NT, 32, 32NT, 91, 91NT
0 - 1,000 gallons $7.81
1,001 - 10,000 gallons (9,000 gallons)$1.83/1,000 gallons
10,001 - 33,000 gallons (23,000 gallons)$2.12/1,000 gallons
33,001 gallons and over $2.32/1,000 gallons
Industrial Water: 14
All Water Usage $2.22/1,000 gallons
State Water Service Connection Fee
Per Connection $0.81/mo.
Sewer Rates - Residential & Commercial: 20, 25, 26
0 - 1,000 gallons $10.10
1,001 gallons and over $6.19/1,000 gallons
Sewer Special Cases: SW21, SW22
Has own well $10 per person
Industrial Sewer Rates: 24
All Sewer Usage $3.84/1,000 gallons
BOD5 (Biochemical Oxygen Demand)$0.415/lb.
TSS (Total Suspended Solids)$0.570/lb.
Testing Actual cost + 10%
Stormwater
Residential $3.00
Non-Residential (7 drainage units per impervious acre)$3.00
Residential Refuse Charges (taxable)
1st Individual Residential Cart $9.41
2nd Individual Residential Cart $13.00
Residential Recycling Charges
Per Cart $2.26
Other:
Water On/Off Charge: $25/each
Water Availability Charge: $42/yr.
Final Bill Processing Fee:$25.00
Refusal of Equipment (manual read) Charge:$30.00
Rates for 2021 Utility Billing
Increasing Block Rates
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CAPITALIZATION THRESHOLDS
Class of Asset Details
Useful
Life
Threshold
Land/land improvements N/A
Land - $1,
Improvements - $50,000
Building/building improvements: $20,000
Floor cover
Construction Interior and
Roof Cover
Heating Ventilation AC and
Lighting Electrical
Elevators, Fire, Piping and
Plumbing
Site Preparation
Walls Exterior
Floor structure, foundation,
roof structure, steel frame
Primary Infrastructure and Utility $75,000
Paving Systems
Water, Sanitary and Storm
Sewer
Secondary Infrastructure $25,000
Sidewalk, Boardwalk,
Pathways
Street lights, Signage
Equipment $10,000
Vehicles
Machinery
Equipment
Software and
non-tangible $10,000
Purchased and Internally
developed
Construction Work In Progress
Upon completion,
per above class
Equipment expenditures for items between $500 and $10,000 are recorded as small tools and
equipment, which is a supply account. Building and improvement expenditures below the
thresholds are recorded as repairs and maintenance. Current revenues finance expenditures for
supplies and repairs and maintenance.
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TAX CAPACITY, TAX LEVY, & TAX RATE HISTORY
Tax Capacity City Tax HRA Tax Total Tax Tax Capacity
Year Value Levy Levy Levy Rate
2012 15,771,688$ 7,850,000$ -$ 7,850,000$ 49.773
2013 18,692,762$ 7,900,000$ -$ 7,900,000$ 42.262
2014 18,289,491$ 8,150,000$ -$ 8,150,000$ 44.561
2015 23,882,689$ 8,535,000$ -$ 8,535,000$ 35.737
2016 25,891,898$ 8,925,000$ 280,000$ 9,205,000$ 35.552
2017 27,583,160$ 9,150,000$ 280,000$ 9,430,000$ 34.188
2018 29,528,145$ 9,547,000$ 323,000$ 9,870,000$ 33.426
2019 29,076,227$ 9,962,000$ 348,000$ 10,310,000$ 35.459
2020 29,878,176$ 10,445,000$ 355,000$ 10,800,000$ 36.147
2021 31,008,092$ 11,063,700$ 366,300$ $11,430,000 36.861
$-
$5
$10
$15
$20
$25
$30
$35
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Tax Levy and Tax Capacity History
Total 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.
ADOPTION: Formal action taken by the City Council to authorize or approve the budget.
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.
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.
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.
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
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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.
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 DOCUMENT: The official written statement prepared by the city’s Finance Department
and adopted by the City Council.
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 PROGRAM: 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.
CHARGES FOR SERVICES: Charges for current services rendered to customers.
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.
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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
type debt is accounted for in the enterprise fund or internal service fund receiving the debt issue
proceeds.
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.
DEPUTY REGISTRAR (DMV): 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.
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, Sewage, Liquor, Deputy Registrar, and
Fiber Optic funds).
ESTIMATED MARKET VALUE: 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.
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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.
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 minus liabilities.
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 BONDS: Bonds for which the government pledges its full faith and credit
to the repayment of the bond’s principal, including interest.
GOAL: A statement of broad direction, purpose, or intent based on the need of a community. A
goal is general and timeless; that is, it is not concerned with a specific achievement in each
period.
GOVERNMENTAL ACCOUNTING: The composite of analyzing, recording, summarizing, reporting,
and interpreting the financial transactions of governmental units and agencies.
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.
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GRANT: A contribution of assets by one governmental unit or other organization to another.
Grants are usually made for specified purposes.
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
city’s taxable market value. The HRA levy limit is .0185% of the taxable market value and must be
used solely for redevelopment purposes.
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.
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.
INVESTMENTS: Securities held to produce income in the form of interest.
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.
LICENSE REVENUES: Revenues received from the sale of business and non-business licenses.
LINE ITEM: A specific item or group of similar items defined by detail in a unique account in the
financial records.
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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.
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 HOMESTEAD CREDIT (MVHC): State paid property tax reduction on owner
occupied homes based on the property’s market value.
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.
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 time frame.
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.
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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.
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.
PURPOSE: A broad statement of the goals, in terms of meeting public service needs, that a
department is organized to accomplish.
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.
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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.
SERVICE LEVELS: Data to determine how effective/efficient a program is in achieving its
objective.
SPECIAL ASSESSMENT: A compulsory levy made by a local government against certain 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.
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
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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.
USER FEE: The service charge for delivering a specific service to one benefiting party.
WORKLOAD DATA: A unit of work to be done.
ACRONYMS
BMP Best Management Practices
BCOL Bertram Chain of Lakes
CAFR Comprehensive Annual Financial Report
CD Certificate of Deposit
CIP Capital Improvement Plan
CP Commercial Paper
CPI Consumer Price Index
DMV Department of Motor Vehicle or Deputy Registrar
EDA Economic Development Authority
MVE Market Value Exclusion
EMV Estimated Market Value
FHLB Federal Home Loan Bank
FNM FiberNet Monticello
FNMA Federal National Mortgage Association
FTE Full Time Equivalent
GAAP Generally Accepted Accounting Principles
GASB Governmental Accounting Standards Board
GFOA Government Finance Officers Association
GO General Obligation
HACA Homestead and Agricultural Credit Aid
HRA Housing and Redevelopment Authority
HVAC Heating, ventilation, and air conditioning
LGA Local Government Aid
MCC Monticello Community Center
MVHC Market Value Homestead Credit
SAC Sewer Availability Charge
TIF Tax Increment Financing
WAC Water Availability Charge
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