2022 Budget2022 ADOPTED BUDGET
City of Monticello, Minnesota
505 Walnut Street • 763-295-2711 • ci.monticello.mn.us
Table of Contents
Introduction and Overview
Directory of Public Officials ........................................................................................................... 1
Distinguished Budget Presentation Award .................................................................................... 2
Strategic Goals & Strategies .......................................................................................................... 3
Priorities & Issues ........................................................................................................................ 11
Budget Overview ......................................................................................................................... 14
Organization Chart ....................................................................................................................... 27
Financial Structure, Policy & Process
Fund Descriptions & Structure .................................................................................................... 28
Departments & Funds Relationship ............................................................................................. 31
Basis of Budgeting ........................................................................................................................ 32
Financial Policies .......................................................................................................................... 33
Budget Development & Administration ................................................................................ 33
Revenue Collection ................................................................................................................ 34
Expenditures and Payments .................................................................................................. 35
Debt Administration .............................................................................................................. 36
Reserves and Fund Balances ................................................................................................. 37
Financial Reporting & Accounting ......................................................................................... 37
Cash Management & Investment .......................................................................................... 39
Balanced Budgets .................................................................................................................. 46
The Budget Process...................................................................................................................... 48
Financial Summaries
Consolidated Financial Schedules
All Funds Summary By Fund Type ......................................................................................... 51
Revenues By Category and Fund Type ................................................................................. 52
Appropriations By Category and Fund Type.......................................................................... 54
Interfund Transfers ................................................................................................................ 56
Three Year Consolidated and Fund Financial Schedules
All Funds Summary By Year ................................................................................................... 57
Fund Balance/Working Capital .................................................................................................... 59
Changes in Fund Balance/Working Capital ........................................................................... 60
Fund Balance/Working Capital History ................................................................................. 61
Revenue Sources By Fund
Revenue Trends & Analysis ................................................................................................... 62
Tax Levy History ..................................................................................................................... 70
Tax Capacity History .............................................................................................................. 71
Largest Property Taxpayer .................................................................................................... 72
Revenues Sources By Fund .................................................................................................... 74
Long Range Financial Plans .......................................................................................................... 76
Long-Term Fiscal Objectives .................................................................................................. 81
Capital & Debt
Capital Expenditures & Capital Improvement Plan ..................................................................... 84
Funding Source Summary ...................................................................................................... 91
Projects & Funding Sources By Department ......................................................................... 92
Debt ............................................................................................................................................. 98
Departmental Information
Staffing Summary....................................................................................................................... 101
General Fund – Summary .......................................................................................................... 102
General Government
Mayor and City Council (101-41110) ................................................................................ 105
City Administration (101-41310) ...................................................................................... 106
City Clerk (101-41410) ...................................................................................................... 108
Finance (101-41520) ......................................................................................................... 109
Assessing (101-41550) ...................................................................................................... 111
Legal (101-41610) ............................................................................................................. 112
Human Resources (101-41800) ........................................................................................ 113
Planning, Zoning & Community Development (101-41910) ............................................ 115
City Hall (101-41940) ........................................................................................................ 118
Public Safety
Law Enforcement (101-42100) ......................................................................................... 119
Fire & Rescue (101-42200) ............................................................................................... 121
Fire Relief (101-42202) ..................................................................................................... 123
Building Inspections (101-42400) ..................................................................................... 124
Emergency Management (101-42500) ............................................................................ 126
Animal Control (101-42700) ............................................................................................. 127
National Guard (101-42800) ............................................................................................ 128
Public Works
Public Works Administration (101-43110) ....................................................................... 129
Engineering (101-43111) .................................................................................................. 131
Engineering & Inspections (101-43115) ........................................................................... 132
Streets, Alleys & Parking Lots (101-43120) ...................................................................... 134
Ice & Snow Removal (101-43125) .................................................................................... 135
Shop & Garage (101-43127) ............................................................................................. 136
Stormwater (101-43130) .................................................................................................. 137
Street Lighting (101-43160) .............................................................................................. 138
Refuse Collection (101-43230) ......................................................................................... 139
Recreation and Culture
Senior Center (101-45175) ............................................................................................... 140
Park Operations (101-45201) ........................................................................................... 141
Park Ballfields (101-45203) .............................................................................................. 142
Public Arts (101-45204) .................................................................................................... 143
Library (101-45501) .......................................................................................................... 144
Shade Tree (101-46102) ................................................................................................... 145
Special Revenue Funds – Summary ........................................................................................... 147
Economic Development Authority Fund (213-46301) ........................................................ 148
Cemetery Fund (215-49010) ............................................................................................... 150
Small Cities Development Program (SCDP) Fund (221-46500) ........................................... 152
Community Center Fund (226-4512x) ................................................................................. 153
Debt Service Funds – Summary ................................................................................................. 155
2011A G.O. Refunding Bond Sub-Fund (312-47000) ........................................................... 156
2015B G.O. Bond Sub-Fund (319-47000) ............................................................................ 158
2016A G.O. Bond Sub-Fund (320-47000) ............................................................................ 160
2017A G.O. Bond Sub-Fund (321-47000) ............................................................................ 162
2018A G.O. Bond Sub-Fund (322-47000) ............................................................................ 164
2019A G.O. Bond Sub-Fund (323-47000) ............................................................................ 166
2020A G.O. Bond Sub-Fund (324-47000) ............................................................................ 168
Closed Debt Service Funds .................................................................................................. 170
Capital Project Funds – Summary .............................................................................................. 171
Capital Project Fund (400-4xxxx) ......................................................................................... 172
Street Lighting Improvement Fund (403-43162) ................................................................. 174
Park & Pathway Improvement Fund (404-45202) .............................................................. 175
Park Dedication Fund .......................................................................................................... 176
Closed Capital Projects Funds.............................................................................................. 177
Enterprise Funds – Summary ..................................................................................................... 179
Water Fund (601-4944x) ..................................................................................................... 180
Sewer Fund (602-49480 & 602-4949x)................................................................................ 182
Stormwater Fund (652-4948x) ............................................................................................ 186
Liquor Fund (609-4975x) ..................................................................................................... 188
Deputy Registrar Fund (653-41990) .................................................................................... 190
Fiber Optics Fund (656-4987x) ............................................................................................ 192
Internal Service Funds – Summary ............................................................................................ 195
Facilities Maintenance Fund (701-00000) ........................................................................... 196
IT Services Fund (702-00000) .............................................................................................. 198
Central Equipment Fund (703-00000) ................................................................................. 200
Benefit Accrual Fund (704-00000) ....................................................................................... 202
Community, Demographic, and Statistical Information .................................................................. 205
Appendix
Property Tax Basics .................................................................................................................... 208
Truth-in-Taxation ....................................................................................................................... 210
Debt Guide ................................................................................................................................. 211
Minnesota Statutes.................................................................................................................... 220
Utility Rates ................................................................................................................................ 224
Capitalization Thresholds........................................................................................................... 225
Tax Capacity, Tax Levy, & Tax Rate History ............................................................................... 226
Useful Terms
Glossary ............................................................................................................................... 227
Acronyms ............................................................................................................................. 234
DIRECTORY OF PUBLIC OFFICIALS
MAYOR & CITY COUNCIL
Position Name Term Expires
Mayor .............................................................................. Lloyd Hilgart 12/31/2022
Council .................................................................................... Bill Fair 12/31/2022
Council ..................................................................... Charlotte Gabler 12/31/2022
Council ........................................................................... Jim Davidson 12/31/2024
Council ........................................................................... Sam Murdoff 12/31/2024
CITY STAFF
City Administrator ...................................................... Rachel Leonard
Public Works Director/City Engineer ............................. Matt Leonard
Finance Director ................................................... Sarah Rathlisberger
Community Development Director ........................ Angela Schumann
Parks, Arts & Recreation Director .................................... Tom Pawelk
City Clerk ................................................................ Jennifer Schreiber
Human Resource Manager ............................................... Tracy Ergen
Communications & Marketing Specialist ........................ Haley Foster
Street Superintendent .................................................. Mike Haaland
Parks Superintendent ............................................... Josh Berthiaume
Water & Sewer 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 ........................................................................ Mike 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, 2021. The city has submitted its budget for consideration
since 2009 and has received this award each year.
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
Distinguished
Budget Presentation
Award
PRESENTED TO
City of Monticello
Minnesota
For the Fiscal Year Beginning
January 1, 2021
Executive Director
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STRATEGIC GOALS & STRATEGIES
The City of Monticello continues to use strategic planning as an important mechanism for
balancing the needs and wants of the community with sound fiscal management. Strategic
planning is also the first step in the annual budget process. The City Council, with two new
members, met in February of 2021 to discuss projects in process, projects on the horizon,
and the ongoing effects of the COVID-19 pandemic.
Leadership staff developed the city’s Mission Statement, Strategic Goals, and Core Values,
which were affirmed by the Council at the worksession.
•The mission of the City of Monticello is to responsibly use our resources to
provide quality services and programs that foster a dynamic community
rooted in history and preparing for a vibrant future.
Mission Statement
1.Create & Preserve Sustainable Livability
2.Build a Connected Community
3.Strengthen our Image as a Destination
4.Support a Vibrant Economy
5.Be a Regional Leader
6.Invest in People
Strategic Goals
•Leadership
•Stewardship
•Responsiveness
•Integrity
•Community
Core Values
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Furthermore, this worksession brought about the idea of the “Big 6”:
• Improvements to the city’s downtown with a focus on Block 52
• A new operations, maintenance, and storage facility for the Public Works department
• The Pointes at Cedar (formerly known as Chelsea Commons) 100-acre development area
• Bertram Chain of Lakes Regional Park, a joint venture with Wright County of which the
city is responsible for the athletic park area
• A Water Treatment Facility to treat the city’s water supply
• Fallon Avenue Improvements, including trunk lines that are necessary for future
development to the South and for increased pedestrian safety
Through the 2022 budget process, Council and staff considered the impacts these projects
would have on the next 10 years. While these are long-term projects, the city’s 2022 budget
supports continuation of a few of these projects, while others are on hold until triggered by
development or external funding. A desire for sustainable growth, as highlighted in the city’s
Monti:2040 Comprehensive Plan, continues to drive decision making along with a funding
approach that will avoid large impacts to the property tax levy each year.
The city has completed numerous plans to help guide future growth and spending priorities. A
chance to develop additional planning for the future decommissioning of the Xcel Energy
Nuclear Generating Plant, which makes up about half of the city’s tax base, became a reality in
2021 when the city was awarded a grant from the MN Department of Employment and
Economic Development as part of its Community Energy Transitions (CET) grant program. In
2021, the city completed:
• The Pointes at Cedar stormwater, grading, and water management plan
• The Pointes at Cedar traffic analysis
Downtown
Revitalization
New Public
Works Facility
The Pointes at
Cedar
Bertram Chain
of Lakes
Regional Park
Development
Fallon Avenue
Improvements
Water
Treatment
Facility
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Additionally, the city initiated the following plans that will be completed in 2022:
• Comprehensive water and sewer studies
• A formal long-term financial plan
• A strategic transition plan summary
• Predesign for Otter Creek Industrial Park grading, drainage, wetland, and stormwater
• Survey for platting the Otter Creek Industrial Park
• Shovel-Ready Certification of vacant lots in Otter Creek Industrial Park
• Cost-Benefit Analysis of the areas Northwest and East of city limits for future annexation
and development
• Related marketing and legislative affairs
The city previously adopted plans that will be incorporated with the CET grant studies,
including:
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. Development of 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.
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.
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
5
within the larger system in direct response to the objectives identified within the plan. The 2040
Plan provides updates but does not duplicate the detailed analysis in this plan. A Parks Master
Plan is recommended by the Monticello2040 Plan to update the detailed portion of this plan,
which is planned for 2023.
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.
The EDA adopts a strategic work plan annually, which directs EDA staff focus and resources over
the following three years.
6. Natural Resource Inventory & Assessment - Adopted 2008.
The purpose of the Natural Resource Inventory and Assessment (NRI/A) is to identify existing
natural resources within the City of Monticello and its growth area (the Monticello Orderly
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.
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.
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,
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E. Post-Construction Stormwater Management Measures; and,
F. Pollution Prevention/Good Housekeeping Measures.
Zoning, subdivision, and illicit discharge ordinances were adopted related to grading, drainage,
erosion control, and storm water management to meet current MPCA requirements per the
city’s new MS4 permit issued on January 16, 2014.
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 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.
12. Water System Plan – Adopted 2004.
A water distribution system model was created to evaluate the existing water system. The water
system plan was then developed using this model to identify water system capital
improvements necessary to serve future land use designations in accordance with the city’s
Comprehensive Plan. A study to update this plan is began in 2021 using CET grant funds and will
be completed in 2022.
13. Sanitary Sewer Comprehensive Plan – Adopted 1995.
The sanitary sewer comprehensive plan identifies the existing sanitary sewer system and
projected future wastewater flows and service areas based on future land use designations in
accordance with the city’s Comprehensive Plan. Several individual sanitary sewer studies were
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developed after the adoption of this plan in response to development. A study to update this
plan is began in 2021 using CET grant funds and will be completed in 2022.
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. However, CET grant funds
are being used to study the feasibility of development to the East side of city limits as well.
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 area jurisdictions to
discuss regional planning and economic development. A joint power agreement was adopted by
the city in December 2015, with a shift in focus from strictly transportation to broader regional
planning taking place a few years later. A TH 25 area transportation study was completed in
2018 and identified options for near-term and long- term improvements to the corridor.
Plans for Facility and Infrastructure Maintenance:
1. Wastewater Treatment Facility Biosolids Dewatering, Energy Efficiency, Headworks and Site
Improvements Feasibility Report – Adopted 2012.
Future wastewater improvements identified in the Capital Improvement Plan include SCADA
system upgrades, Phase 2 facility and site improvements, solids handling improvements and
headworks improvements.
2. Overall Street Reconstruction Program – Adopted 2004, ongoing as part of capital
improvement plan.
The 2022-2026 Capital Improvement Plan includes projects related to the program, with various
projects located through the city planned. A street reconstruction project is budgeted in 2022.
3. New Public Works Facility
The city completed a study of the public works facility in 2007 which identified the need for
additional storage and more efficient configuration of the public works department. Due to the
recession shortly thereafter, the project never gained traction, but was recently revived because
of need. Concept plans have been drafted, and land was purchased in 2021 for the future
facility. Designs and specifications are included in the 2022 budget.
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4. Transportation Projects
TH25 Safety and Lighting Improvements – MnDOT is proposing an interim improvement project
that mixes permanent and temporary elements to promote traffic calming and accessibility.
MnDOT is also installing additional streetlights along TH25. The new lighting will be added at
neighborhood entrances south of School Boulevard as well as at the J-turn located
approximately a quarter of a mile down the road.
The Monticello EDA completed acquisition of parcels in downtown’s Block 52 and entered into a
preliminary development agreement (PDA) with a developer to redevelop a central block next to
the only Mississippi River crossing within 20 miles. While the majority of the block
redevelopment will be handled by private investment, the city anticipates necessary public
investment to support the project and increase access and safety to the area.
Financial Plans:
1. Annual Budget - Adopted each December.
2. Capital Improvement Plan - Updated and adopted each year; most recently for 2022 -2026.
3. Long-term Financial Management Plan – In Progress.
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This first phase of the Comprehensive Plan
process, the Visioning phase, included a
community engagement process to identify
common values, growth aspirations and a vision
to inform the planning direction for the next
20 years. The vision, value statements and
preferred development scenario will serve as the
foundation for creating the new Comprehensive
Plan during the second phase of the planning
process. The Comprehensive Plan provides a set
of goals, policies and strategies for achieving
Monticello’s vision for the future.
PHASE ONE | JANUARY 2020
In 2040 the City of Monticello is an inclusive community focused around sustainable
growth while maintaining its small-town character. Monticello is a Mississippi River
town known for its schools, parks, biking and walking trails and vibrant downtown.
Monticello is an evolving, friendly and safe community that respects the quality of its
environment, fosters a sense of belonging and connection, encourages a healthy and
active lifestyle and supports innovation to promote a prosperous economy.
A balanced land use and transportation framework that provides options and connectivity.
A range of attainable housing options in terms of type, cost, and location.
A respected school and education system serving the community.
A healthy community focused on physical and mental health and wellness of its residents.
A safe, clean, and beautiful community
supported by caring and helpful residents.
A network of parks, open space and trail connections that provide recreation opportunities.
An inclusive community welcoming people of all ages, races, religions and ethnic backgrounds.
A diversified and strong local economy competitive at regional, state and national levels.
A vibrant downtown that embraces the River and provides a focal point for the community.
A thriving arts and culture scene that reflects the creativity of the community and supports a sense of place.
VISION STATEMENT
VALUE STATEMENTS
VISIT
CI.MONTICELLO.MN.US/MONTI2040
TO LEARN MORE!
PREFERRED SCENARIO
PRIORITYGREENWAYSMIXED RESIDENTIAL/COMMERCIAL
INDUSTRIALCOMMERCIAL
PLANNED DETACHED
RESIDENTIAL DEVELOPMENT INTERCHANGE
LEGEND:DETACHED RESIDENTIAL
MIXED COMMERCIAL/OFFICE/LIGHT INDUSTRIALATTACHED RESIDENTIAL RIVER
ACCESS
• Sustainability - Focus on sustainability, open space and wetland
preservation throughout City.
• Infill Development - New service commercial and light industrial infill.
• Conservation Neighborhoods - Single-family housing developed as
conservation subdivisions in a clustered fashion mitigating impacts to
sensitive areas.
• Industrial Expansion - Full build out and expansion of Otter Creek
Industrial Park and growth around future Interchange.
• Multi-Family Housing - New multi-family infill development near core
of downtown and other focus areas.
• New School - New elementary and middle school campus with
environmental focus.
• Downtown - Downtown plan implementation thriving with new
commercial, mixed-use and public realm improvements.
• Mississippi River - Focus on River with new access, connections and
riverfront trail.
• New Employment Center - New industrial business park developed
around new interchange with green technology, renewable energy,
manufacturing and other uses.
• Xcel Facility - The Xcel Monticello Nuclear Generating Plant is
licensed through 2030 and will seek relicensing to 2040.
• Annexation Area - Portions of the Orderly Annexation Area are
designated as an Urban Reserve for future development. Development
would likely include conservation single-family cluster subdivisions.
Note: The Preferred Scenario guidance and mapping provided in the Vision
Report will be further refined during the Comprehensive Plan process. This
map is not the City of Monticello’s final Land Use Plan. This map provides
initial guidance for the next phase of the project, the Comprehensive Plan,
and will be further detailed and refined.
The preferred development scenario is the result of community feedback on the four previous scenarios and the community’s vision.
The community envisions Monticello in 2040 as an environmentally and economically sustainable community that has experienced
strong, balanced growth.
A
B
C
D
E
F
G
H
I
J
K
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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EBRIARWOOD AVEBRIARWOOD AVEBERTRAMCHAIN OFLAKES
BERTRAMCHAIN OFLAKES
85TH ST NE85TH ST NE
COUNTY RD 39 NECOUNTY RD 39 NE
COUNTY
R
D
3
7
N
E
COUNTY
R
D
3
7
N
E
MI
S
S
I
S
S
I
P
P
I
R
I
V
E
R
MI
S
S
I
S
S
I
P
P
I
R
I
V
E
R
Downtown Mixed Use10-18 Unit/Acre10-18 Unit/Acre
Service Commercial and Light Industrial Infill
Regional Oriented Commercial
Multi-Family10-18 Unit/Acre10-18 Unit/Acre
Medium and Small Lot Conservation Developments4-10 Units/Acre4-10 Units/Acre Potential School Site withEnvironmental Focus
Medium and Small Lot Conservation Developments4-10 Units/Acre4-10 Units/Acre
Otter Creek
Industrial Park
Commercial/Residential Mix (Neo Traditional) Development
Residential (South) Residential (South) 8-10 Units/Acre8-10 Units/Acre
A
B
CC
C
D
E
F
G
H
H
I
J
K
K
K
Technology, Renewable Energy,
Manufacturing &
Distribution Warehousing
10
PRIORITIES & ISSUES
The city’s priorities were redefined in the Monti:2040 Comprehensive Plan adopted in 2020. This
Comprehensive Plan highlights the city’s desire to grow from within before expanding out by focusing on
three key themes: Sustainability, Community Health and Sense of Place. The Comprehensive Plan is the
primary influence in financial planning.
Monticello, like all other levels of government, 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. Fortunately, 2021 was a year spent learning about and
responding to the spread of the virus, and the 2022 budget reflects a more routine approach to operations
while at the same time retaining efficiencies and other opportunities discovered during the height of the
pandemic. The ongoing effects of the pandemic can be hard to forecast, but revenues are budgeted
conservatively, and expenditures are estimated liberally to ensure sound financial position.
The American Rescue Plan Act of 2021 (ARPA) provided just over $1.5 million directly to the city. An
additional $500,000 is available for water or sewer infrastructure improvements through Wright County.
$725,000 of these funds were used in 2021 for lost revenue at the Monticello Community Center. Staff
and Council are working to ensure the remaining funds are used in achieving strategic goals in the
community.
The city changed its strategy for budgeting in 2022 from a department-by-department approach to an
entity-wide “bucket” approach including the following areas:
Notable changes in service levels and fees include:
Personnel:
•Administration: A new Administrative Assistant position at City Hall is included in the 2022
budget. The position will allow a staff member to specifically focus on administrative tasks, while
shifting the full-time Receptionist position to two part-time staff members to achieve greater
availability and flexibility in front desk coverage. Budget impact: $73,000.
Personnel
Equipment
Major Non-Capital
Capital Projects
11
• Parks, Arts & Recreation: The city merged operations of the Monticello Community Center and
the Parks department into one streamlined Parks, Arts & Recreation (PAR) department in 2021.
The Parks Superintendent was promoted to PAR Director, and additional staffing shifts followed.
Budget impact: $12,000.
• Parks, Arts & Recreation: The Monticello Community Center was able to expand hours and
welcome back additional patrons in 2021 with the decline of COVID-19 restrictions. While not yet
back to pre-pandemic levels, the facility has expanded hours and services requiring more staff
support than earlier in the pandemic. Therefore, part-time wages were adjusted in the 2022
budget to reflect the current job market and to retain current talent. Budget impact: $182,000.
• Hi-Way Liquors Store: COVID-19 created strain on the workforce, especially to front-line retail
workers. The city’s municipal liquor store, Hi-Way Liquors, felt the effects of the “great
resignation” and was challenged with a limited workforce. In response, the city created an
additional full-time clerk position and instituted a premium pay benefit that pays part-time clerks
for working a greater number of hours each pay period. Budget impact: $55,000.
Equipment:
• Vehicles: With the additional staff added in 2021 and budgeted for 2022, vehicles are included in
the 2022 budget for the Engineering Inspector, Building Inspector and Facilities Maintenance
Manager. Replacement vehicles for the building, streets, and utilities departments are also
included. Budget impact: $267,000.
• Fire: The Fire Department members need special equipment to protect firefighters while
responding to calls. Budget impact: $22,000.
• Streets: The Streets Department, through the Central Equipment Fund, budgeted for a paver and
trailer, dump truck, and mini loader. Budget impact: $580,000.
• PAR: The parks operations department, through the Central Equipment Fund, budgeted for three
(3) mowers, a Kawasaki mule, and an Isuzu. Budget impact: $207,000.
• Fire: The Fire Department needs a new Engine truck. Budget impact: $725,000.
• Storm: A replacement street sweeper is included in the Stormwater Fund budget in 2022. Budget
impact: $187,000.
• IT devices: The city has a rotation for laptops, PCs, and printer/scanners for replacement each
year. Budget impact: $31,000.
Major Non-Capital:
• Repairs & Maintenance: The city annually budgets amounts in the Water, Sewer, Stormwater,
Streets, and Parks departments for unanticipated repairs and maintenance on the infrastructure,
such as a water main break or street potholes. Budget impact: $720,000.
• Backup Generator: The water department will install a backup generator for use at a well. Budget
impact: $100,000.
• Access Upgrades: The Community Center is over 20 years old, and improved accessibility by way
of ADA push buttons and card access (rather than keys) are budgeted in 2022. Budget impact:
$36,000.
12
Capital Projects:
• 2022 Street & Sidewalk Improvement Projects: Streets and sidewalks throughout the city that
need repair will be re-paved and/or improved. Budget impact: $2,800,000.
• SCADA System Upgrade: The Water and Sewer utilities use a Supervisory Control and Data
Acquisition system to collect and analyze data. Budget impact: $1,200,000.
• Otter Creek Industrial Park Pond Improvements: The Otter Creek Industrial Park requires
stormwater pond improvements to attract additional development. Budget impact: $600,000.
• Public Works Facility: The city will begin plans and specifications on a new Public Works Facility in
2022 with anticipated construction in 2023. Budget impact: $500,000.
• The Pointes at Cedar: A 100-acre area in the middle of the city has been relatively untouched until
the past couple of years. To create a one-of-a-kind community space, The Pointes at Cedar project
envisions a large, shared pond (serving stormwater purposes) with public park space surrounded
by mixed-use residential and commercial development. Budget impact: $2,700,000.
Furthermore, the city analyzes utility rates annually. The following increases were adopted in the 2022 Fee
Schedule and incorporated into the 2022 budget.
• Water & sewer: Water and sewer fees increase 5% for base and usage charges in anticipation of
large upcoming capital improvements.
• Stormwater: Stormwater fees increase 33% in 2022, from $3.00/drainage unit to $4.00/drainage
unit to fund significant capital costs coming up in the next couple years.
• Garbage & recycling: Garbage and recycling fees increase in 2022. Prior to the implementation of
fees in 2018, residential garbage and recycling services were wholly subsidized by the tax levy. In
2022, fees will cover the cost of residential garbage 100% and recycling costs will be covered 75%
by user fees. The city plans to have all garbage and recycling fees paid for by users in 2023.
13
BUDGET OVERVIEW
INTRODUCTION
The budget is a tool; how this versatile tool is used depends on the stakeholder. Policy makers
use the budget to provide direction on service levels and place limits on spending. For
managers, the budget offers benchmarks for measuring performance and assessing
stewardship. To community advocates, the budget conveys visibility as to whether their
concerns are being addressed. Universally, the budget is an essential tool for communicating
the city's plans, policies, procedures, and objectives regarding the services to be delivered and
the assets to be acquired in the upcoming and future fiscal years. 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 maintenance; snow and ice removal; water, sewer and
stormwater utility services; parks, arts, and recreation amenities (including community center
facility) and programming; and administrative and planning services. In addition, the city owns
and operates a department of motor vehicles (DMV), municipal off-sale liquor store (Hi-Way
Liquors), and a fiber optic network (FiberNet 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 a low tax rate while providing the best possible service.
The 2022 property tax levy increase was less than in prior years, and the tax levy (capacity) rate
increased over 2021. 2022 Budget: The city levy increases $289,300 (2.6%) to $11,353,000 and
the Housing and Redevelopment (HRA) levy increases $21,700 (5.9%) to $388,000. Combined
(city + HRA) tax levy increase: $311,000 (2.7%). The tax levy rate is the third lowest of the 17
cities in Wright County.
14
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% designated for
non-athletic purposes and 50% designated for athletic purposes. The city also maintains 365
acres of park land and 42.0 miles of trails. 2022 Budget: $525,000 School Boulevard pathway
improvements and lighting, $175,000 Fenning Avenue pathway lighting, $51,400 park cameras.
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 2022 General Fund includes a robust amount for chip/seal maintenance, and the Capital
Projects fund is utilized for improvement projects. 2022 Budget: $1,795,000.
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. 2022 Budget: $19,850 – memberships.
5. Implement the downtown redevelopment plan which will maintain a downtown area that
combines a successful commercial district, community identity and heritage, and
connection with the Mississippi River.
The 2017 Small Area Study plan for downtown identified various options for re-creating the
city’s downtown. The city transferred $300,000 from the General Fund to the Capital Project
Fund in 2017 to start implementing the plan. 2022 Budget: $100,000.
6. Seek to expand the supply of "step up" housing that allows people to upgrade their home
without leaving the community.
Staff is facilitating the development of additional residential home lots on the perimeter of the
city by working with developers and engineers. Infrastructure needs are regularly assessed and
incorporated into the city’s capital improvement plan. A housing needs and market demand
study was completed in 2020. 2022 Budget: None.
7. Seek to develop and attract a wide range of employment opportunities with a growing
emphasis on higher-paying jobs.
This concept promotes the city’s competitive advantages (i.e., low taxes, property availability,
transportation access, etc.) to businesses looking to move or grow. 2022 Budget: $108,000
8. Continue to maintain high quality water and sewer treatment facilities.
With some of the lowest water and sewer rates in Minnesota, the city provides excellent services
from these two utilities to residents and businesses. The budget includes funds for wastewater
treatment facility improvements along with enough for additional, ongoing system
15
improvements in each fund. Monticello’s water is rated as one of the best tasting in Minnesota.
2022 Budget: Water - $150,000 annual improvements, $400,000 SCADA system update; Sewer -
$250,000 annual improvements, $125,000 wastewater facility repair and maintenance, and
$800,000 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. The contract with Arvig Enterprises was
extended in July of 2021 for an additional five years. 2022 Budget: $183,500 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 2022 budget.
TOTAL BUDGET
The 2022 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 2021 and 2022 budgets:
Total revenues decrease 1.7% and total expenditures increase about 11.0% in 2022. General
Fund revenues and expenditures increase 6.6%, about half of which is due to the property tax
levy increase. The decrease in debt service expenditures reflects the early redemption of the
2014A judgment bonds in 2021; the 2014A equipment bonds remain outstanding. Capital
project funds will incur higher expenditures due a street improvement project and planning and
grading work anticipated on The Pointes at Cedar development area. The water and sewer
funds have budgeted $400,000 and $800,000, respectively, for a SCADA system upgrade that
began in 2021 and will be completed in 2022. The Stormwater enterprise fund has $990,000
budgeted for infrastructure improvements and maintenance.
Fund Type 2021 2022 2021 2022
General 9,875,000$ 10,530,000$ 9,875,000$ 10,530,000$
Special Revenue 2,460,000 2,934,000 2,087,000 2,720,000
Debt Service 3,270,000 2,739,000 3,325,000 2,925,000
Capital Project 4,190,000 2,702,000 4,294,000 7,290,000
Enterprise 14,419,000 14,898,000 15,605,000 15,519,000
Internal Service 1,559,000 1,345,000 1,545,000 1,800,000
Total 35,773,000$ 35,148,000$ 36,731,000$ 40,784,000$
Total Budget
Revenues Expenditures
16
The following graphs display the revenues and expenditures attributable to each fund-type in
the 2022 Budget:
PROPERTY TAXES
The state of Minnesota has granted local municipalities the authority to levy taxes to fund
operations and debt payments. For the City of Monticello, the property tax levy accounts for
71% of revenues in the General Fund and 30% in the special revenue funds. In 2022, debt
service funds will receive $2,311,400 in property taxes for principal and interest payments on
General
30%
Special Revenue
8%Debt Service
8%
Capital
Project
8%
Enterprise
42%
Internal
Service
4%
2022 Revenues by Fund Type
General
26%
Special
Revenue
7%
Debt Service
7%
Capital
Project
18%
Enterprise
38%
Internal
Service
4%
2022 Expenditures by Fund Type
17
general obligation debt, which is 18% lower than the prior year’s $2,831,479 due to the early
redemption of the judgment portion of the 2014A bonds. With the available levy capacity, the
city levied $1,081,600, up from prior year $578,221, for the Capital Projects Fund in 2022. For
2022, the city's general (operations and debt) property tax levy will increase to $11,353,000, an
increase of $289,300 (2.6%) over the prior year. For the seventh consecutive year, the city
imposed a Housing and Redevelopment Authority (HRA) special benefit levy. The HRA levy
increases to $388,000 (5.9%) from $366,300 in the prior year. The special benefit levy is
receipted in the Economic Development Authority Fund. When added together, the two levies
represent a 2.7% 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 2022 at $30,816,639, a 0.7% decrease. The Xcel Energy nuclear power plant taxable
market valued dropped 6.8% in 2022 to $751 million. The value of the plant is still 2.5 times
greater than its 2012 value of $298 million. The Xcel plant alone accounts for just under half of
the city’s tax capacity. The city's property tax levy is divided by the tax capacity to determine
the city's tax capacity rate, which is then applied to each property's tax capacity to determine
the city’s tax. For 2022, the city's tax capacity rate is expected to increase to 36.840%, a 3.3%
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.
PERSONNEL SERVICES
The 2022 budget includes a number of staffing changes. First, a new Administrative Assistant
was added at City Hall. The Community Center Director position was eliminated in November
2020 in response to the COVID-19 pandemic; it was replaced by a Parks, Arts, and Recreation
Director that oversees the Community Center and parks operations. The city also budgeted to
add an additional full-time clerk at the municipal liquor store in response to staffing issues
brought about by COVID-19. A 3.0% wage adjustment for all employees was included in the
Tax Capacity Capacity Tax Capacity Rate City Tax HRA Levy
Year Value % Change Rate % Change Levy Levy % Change
2012 $15,771,688 -4.0% 46.191 -1.6% $7,850,000 $0 2.2%
2013 $18,692,762 18.5% 42.262 -8.5% $7,900,000 $0 0.6%
2014 $18,244,090 -2.4% 44.672 5.7% $8,150,000 $0 3.2%
2015 $23,882,689 30.9% 35.737 -20.0% $8,535,000 $0 4.7%
2016 $25,891,898 8.4% 34.470 -3.5% $8,925,000 $280,000 4.6%
2017 $27,583,160 6.5% 33.172 -3.8% $9,150,000 $280,000 2.5%
2018 $29,528,145 7.1% 32.332 -2.5% $9,547,000 $323,000 4.3%
2019 $29,076,227 -1.5% 34.262 6.0% $9,962,000 $348,000 4.3%
2020 $29,870,392 2.7% 34.968 2.1% $10,445,000 $355,000 4.8%
2021 $31,026,583 3.9% 35.659 2.0% $11,063,700 $355,000 5.9%
2022 $30,816,639 -0.7% 36.840 3.3% $11,353,000 $366,300 2.6%
18
2022 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 $1,203.58 per participant, and the non-union health benefit is $876.79 for single plan
and $1,627.69 for family plan participants. The union’s plan requires a flat premium for union
employees regardless of participation. Staff will continue to explore ways to reduce future
premium increases to both the city and its employees.
The contribution rates to the Public Employees Retirement Association (PERA) will remain the
same in 2022 for both employer and employees. PERA rates: 7.50% of wages for employer and
6.50% for employee. The budget also calculates FICA and Medicare taxes at 6.20% and 1.45%
respectively for 2022.
GENERAL FUND
Expenditures
The following schedule displays 2022 budgeted General Fund expenditures by department
compared with the prior year:
The 2022 budget increased 6.6% over the 2021 budget. Personnel service includes wages and
benefits for all full-time, part-time, and seasonal employees. This cost category rises with wage
and benefit inflation and additions to staff.
The chart below presents the 2022 budgeted expenditures allocated by function/department:
Department 2021 2022 % Change
General Government 2,274,716$ 2,501,429$ 10.0%
Public Safety 2,776,094 3,010,890 8.5%
Public Works 3,412,539 3,403,902 -0.3%
Recreation & Culture 1,411,651 1,607,779 13.9%
Operating Transfers Out - 6,000 -
Total 9,875,000$ 10,530,000$ 6.6%
General Fund Expenditures and Other Uses
General Fund Expenditures &
Transfers -2022
General Government (24%)
Public Safety (28%)
Public Works (33%)
Recreation & Culture (15%)
Operating Transfer to EDA (0.1%)
19
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 2022
budget for the Public Works department decreased 0.3%. PW administration (-35.2%),
engineering & inspections (+27.5%), streets & alleys (-13.2%), and shop & garage (+22.7%)
budgeted expenditures very the largest factors due to an adjustment to the allocation of the
PW Director/City Engineer’s wage allocation, and adjustment of shop & garage costs out of the
streets & alleys department. 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
2022 Public Safety Department budget increased 8.5%. 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 2022 contract includes a $2.45 increase in the hourly service rate for 52 hours per day. The
fire and rescue activity budget increased 10.1% due to wage increases. While emergency
management shows a 320% increase, the increase simply reflects the budgeted use of a State
Preparedness grant, which is offset by budgeted grant revenues.
The 2022 budget for general government activities increases 10.0%. The city administration
activity increased 12.4% due to additional subscription capacity in the solar farm investment
(offset by rebate revenue) in 2021. The city clerk activity increases 51.5% because 2022 is an
election year, and the city is transitioning from 2 polling precincts to 4. The legal and city hall
budgets decrease due to decreased activity. The general city buildings department is eliminated
now that the DMV has taken over the Prairie Center Building, and all costs are accounted for in
the Deputy Registrar enterprise fund.
Recreation and culture expenditures increase by 13.9% in 2022. Public art (+25.6%) increased
with additional consulting time and budgeted use of successful grant applications. The parks
operations (+15.9%) budget reflects anticipated inflation of costs and increased activity as the
restrictions imposed in response to COVID-19 have been lifted.
Including services for police, assessor, and legal services, other services, and charges account
for 48% of General Fund appropriations. Appropriations for personnel services follow with 40%
of the total and rises with wage and benefit inflation plus the new position. Capital outlays
include the internal rent payments to the Central Equipment Fund. Additional equipment
purchases will translate into higher rent payments.
The following table and graph provide perspective on expenditures and other uses for the
various General Fund expenditure classifications in the 2021 and 2022 budgets:
Department 2021 2022 % Change
Personnel Services 3,651,591$ 3,897,421$ 6.7%
Supplies 817,700 874,870 7.0%
Other Services & Charges 4,969,109 5,173,309 4.1%
Capital Outlay 436,600 578,400 32.5%
Operating Transfers Out - 6,000 -
Total 9,875,000$ 10,530,000$ 6.6%
General Fund Appropriations
20
Revenues and other sources
Revenues and other sources supporting General Fund expenditures and other uses are
classified as follows:
The General Fund’s tax levy increases by 4.3%, while the General Fund’s portion of the
combined levy (city + HRA) increases from 62.7% to 63.7%. Licenses & Permits and Fines &
Forfeits increase to better align with prior year trends. Intergovernmental Revenues increase to
better match Police Aid with prior year trends and to factor in grant revenue for the Arts
program. Charges for services increase 15.9% with increased garbage and recycling fees.
Miscellaneous revenues increase 12.0% due to additional solar farm subscriptions added in
2021.
The property tax levy generates 71% 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.
Personnel
Services
40%
Supplies
8%
Other Services &
Charges
48%
Capital Outlay
4%
2022 Appropriations -General Fund
Classification 2021 2022 % Change
Property Taxes 7,169,000$ $7,475,000 4.3%
Franchise & Other Taxes 256,500 258,000 0.6%
Licenses & Permits 420,300 471,100 12.1%
Intergovernmental Revenues 404,000 463,000 14.6%
Charges for Services 965,300 1,118,600 15.9%
Fines & Forfeits 41,600 51,600 24.0%
Special Assessments 150 100 -33.3%
Miscellaneous 618,150 692,600 12.0%
Total 9,875,000$ 10,530,000$ 6.6%
General Fund Revenues and Other Sources
21
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 2022 outside of one
loan to a local business.
Like the General Fund, the special revenue fund budgets are set at a level to maintain services.
The tax levy supports community center operations ($485,000) and the Economic Development
Authority ($388,000). 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, and the fund estimated needing $425,000 of American
Rescue Plan Act (ARPA) grant funding to balance the 2022 budget.
The following tables display the change in budgeted revenues and other sources and the
change in budgeted expenditures and other uses for special revenue funds:
71.0%
2.5%
4.5%
4.4%
10.6%
0.5%6.6%
2022 Revenues -General Fund
Property Taxes
Franchise & Other Taxes
Licenses & Permits
Intergovernmental
Revenues
Charges for Services
Fines & Forfeits
Classification 2021 2022 % Change
Property Taxes 851,300$ 873,000$ 2.5%
Tax Increments 617,344 630,344 2.1%
Intergovernmental Revenues - 425,000 -
Charges for Services 456,600 931,900 104.1%
Miscellaneous 209,756 67,756 -67.7%
Operating Transfers In 325,000 6,000 -98.2%
Total 2,460,000$ 2,934,000$ 19.3%
Special Revenue Funds Revenues and Other Sources
22
DEBT SERVICE FUND (Aggregate of Sub-Funds)
The city's debt service for 2022 is $2,812,800, or $512,200 less than the prior year due to an
early redemption in 2021. Funding for debt service comes from special assessments, tax
increments, and property. Outstanding debt at January 1, 2022: debt service funds -
$21,110,000; Sewer enterprise fund - $3,116,000; Central Equipment internal service fund -
$180,000. The city's bond rating from Moody’s Investors Services is "A1."
CAPITAL PROJECT FUNDS
The budgets for capital project funds are based on the 2022 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. No debt issuances are planned for 2022.
ENTERPRISE FUNDS
Total revenues and other sources for the enterprise funds (Water, Sewer, Stormwater, Fiber
Optic, DMV, and Liquor) is estimated at $14,898,000 for 2022. The change in Sale of Goods
represents a conservative budget policy of estimating liquor sales at the prior year level.
Charges for services increases with higher rates charged on enterprise fund customers.
Miscellaneous revenues reflect an increase in projected interest earnings as they were
budgeted extremely conservatively in the past and didn’t reflect typical activity.
Department 2021 2022 % Change
Personnel Services 880,961$ 1,246,373$ 41.5%
Supplies 78,420 120,900 54.2%
Other Services & Charges 737,295 962,826 30.6%
Capital Outlay 190,324 191,976 0.9%
Operating Transfers Out 200,000 197,925 -1.0%
Total 2,087,000$ 2,720,000$ 30.3%
Special Revenue Funds Appropriations
Classification 2021 2022 % Change
Sale of Goods 6,679,000$ 7,013,000$ 5.0%
Licenses & Permits 2,000 2,000 0.0%
Charges for Services 7,329,000 7,634,757 4.2%
Special Assessments 38,000 38,000 0.0%
Miscellaneous 96,000 135,243 40.9%
Contributed Capital 75,000 75,000 0.0%
Operating Transfers In 200,000 - -100.0%
Total 14,419,000$ 14,898,000$ 3.3%
Enterprise Funds Revenues and Other Sources
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Personnel services increase with wage and benefit inflation of 3.0%, an additional full-time clerk
at the liquor store, and an update to the allocation of streets (stormwater) and utilities staff.
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. As mentioned
in the Special Revenue Funds description, any shortfalls will be alleviated using ARPA funds in
2022.
INTERNAL SERVICE FUNDS
The City of Monticello operates four internal service funds: Facilities Maintenance, Information
Technologies (IT) Services, Central Equipment Fund, and Benefits Accrual. These funds operate
on a cost-recovery basis, but the time horizon differs greatly. Internal service fund charges are
recorded as expenditures in other funds.
The Facilities Maintenance and IT Services funds are not capital intensive with annual small
tools and equipment purchases in the $20,000 to $30,000 range. IT equipment usually has a
shorter replacement cycle. The Facilities Maintenance Fund focuses on proactive monitoring
and repairs & maintenance of existing city buildings. Major capital improvements or
replacements are funded through the appropriate capital projects fund or enterprise fund.
The Central Equipment Fund is funded through annual rental charges to benefitting budget
units to recover equipment purchase costs over 7–10-year periods. Annual depreciation and
inflation for each capital asset are used in calculating annual rental payments.
The Benefits Accrual 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.
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 Development 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 anticipated planning and construction occurring in
2022 and funding planned from existing reserves and future debt issuance. Enterprise fund
balances decline by roughly $600,000, largely the result of stormwater improvements paid for
from existing working capital.
Department 2021 2022 % Change
Personnel Services 2,027,951$ 2,278,593$ 12.4%
Supplies 5,449,799 5,699,100 4.6%
Other Services & Charges 3,697,624 3,942,490 6.6%
Capital Outlay 3,738,000 3,237,500 -13.4%
Debt Service 366,626 361,317 -1.4%
Operating Transfers Out 325,000 - -100.0%
Total 15,605,000$ 15,519,000$ -0.6%
Enterprise Funds Appropriations
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CHALLENGES IN CONTEXT
The preparation of this budget reflects the need to meet both short-term and long-term
challenges. While the local economy is stable, the commercial and residential tax base is
growing at a modest pace while the Monticello Nuclear Generating Plant still represents a
significant portion of the tax base. 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, in 2021, the city paid off the judgment bonds related to the 2014 settlement of the
telecommunication bondholder’s class-action lawsuit, which further allows the city to put the
bond default behind it. The city renewed its contract with Arvig Enterprises through June of
2026. Since 2019, Fibernet has had positive cash flow from operations, and is positioned to
cover the majority, if not all, of the capital investment into new neighborhoods in the coming
years.
Third, the city is moving ahead with several capital projects. Most large projects have
reimbursement resolutions, meaning the city can recover their temporary draw on reserves
with debt proceeds. Major Council initiatives in the next few years include improvements to
downtown with a focus on Block 52, a new public works facility, and the Pointes at Cedar
development area. Other large projects further on the horizon include additional phases for
improvements at the Bertram Chain of Lakes (BCOL) Regional Park, safety and utility
improvements on Fallon Avenue, and construction of a Water Treatment Plant.
Fourth, stable leadership is taking a longer view. An existing councilmember became mayor in
2021 with one new member elected and another seat appointed. 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 economic and park
development impacted the decisions made in drafting the 2022 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, 2021. To receive this award, a
governmental unit must publish a budget document that meets program criteria as a policy
document, as an operations guide, as a financial plan, and as a communications device.
This award is valid for a period of one year only. We believe our current budget continues to
conform to program requirements, and we are submitting it to GFOA to determine its eligibility
for another award.
CONCLUSION
Conservation of city financial resources continues to be a very important objective. The budget
is the prime tool in making sure limited resources are wisely utilized. It is the city’s belief that
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the 2022 budget allows the city to deliver excellent municipal services in a cost effective and
efficient manner at current levels. The 2022 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
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ORGANIZATION CHART
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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 Annual
Comprehensive Financial Report (ACFR).
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 and do not match the major funds
presented in the city’s ACFR because the calculation for purposes of the ACFR differ slightly and
are based on actual rather than budgeted revenues and expenditures.
General Fund - The General Fund is used to account for all financial resources except those
required to be accounted for in another fund.
Capital Projects - The Capital Projects (capital project) Fund is used to account for all capital
acquisition and construction activities of the city not accounted for in another capital project,
enterprise, or internal service fund.
Liquor - The Liquor (enterprise) Fund is used to account for the operations of the city’s liquor store.
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
Sewer Fund
Stormwater Fund
Liquor Fund
Deputy Registrar Fund
Fiber Optics Fund
Internal Service
Facilities Maintenance Fund
IT Services Fund
Central Equipment Fund
Benefit Accrual Fund
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DEPARTMENTS & FUNDS RELATIONSHIP
The departments within each fund’s budget are noted in the matrix below:
All capital project funds, except the Parks & Pathway Improvement Fund, were combined for this
presentation. Principal and interest payments on debt occur in the Debt Service Fund (comprised of
subfunds) , Sewer Fund, and Central Equipment Fund.
Community Capital Pa rk &Water, Sewer Liquor Deputy Fiber Facilities IT Central Benefit
General EDA Cemetery Center Projects Pathway & Stormwater Store Registrar 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 ●●●
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, it presents a picture of the city government operations and
intentions for the year.
• For the city council, it serves as a policy tool and as an expression of goals and objectives.
• For city management, it is used as an operating guide and a control mechanism.
The city's budget encompasses both the operating budget and the capital improvement
budget. Each budget unit includes amounts appropriated for both operating expenditures and
capital acquisitions and improvements. Accompanying narrative for each budget unit briefly
explains the items included.
BASIS OF BUDGETING
The city’s accounts are categorized by funds, each of which is accounted for as an individual entity.
The operations of each fund are accounted for with a separate set of self-balancing accounts that
comprise its assets, deferred inflow/outflows, liabilities, fund equity, revenues, and expenditures.
Governmental funds (the General Fund, special revenue, debt service, and capital project funds) use
the modified accrual basis for budgeting and accounting. Revenues are recognized in the accounting
period in which they become measurable and available. Expenditures are recognized when liabilities
are incurred.
Proprietary funds (Enterprise and Internal Service funds) use the modified accrual basis for
budgeting and the accrual basis for accounting for financial reporting. In the accrual basis of
accounting, revenues are recognized in the accounting period in which they are earned, and
expenses are recognized in the accounting period in which they are incurred, regardless of when the
actual cash flow occurs. For example, accrual basis accounting differs with the modified accrual basis
by recording expenses for depreciation and compensated absences but not debt principal payments,
whereas the modified accrual basis of accounting would classify the original capital cost as an
expenditure (and would therefore have nothing to depreciate), the compensated absence payment
as an expenditure at the time of payment rather than when earned, and debt proceeds as revenue
when received and expenditures when repaid. Each proprietary fund’s financial statements, located
in the city’s Annual Comprehensive Financial Report (ACFR), are reported on the full accrual basis.
WORKLOAD/PERFORMANCE BUDGETING
For many years, the city of Monticello started the development of a workload/performance
budget. The type of budgeting shifts the emphasis away from describing what will be
purchased (inputs) towards describing what will be accomplished (outputs and outcomes).
While this budgeting process faces numerous structural and cultural hurdles, this work-in-
progress continues today with both an organization-wide and budget-unit specific focus on
outcomes.
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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
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.
2. The city will estimate revenues in a realistic and conservative manner.
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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. Ongoing expenditures will be limited to levels which can be supported by ongoing revenues.
Utilization of reserves to fund on-going expenditures will produce a balanced budget, however,
this practice will eventually cause severe financial problems. Once reserve levels are 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.
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.
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5. Construction projects and capital expenditures of $10,000 or more will be included in the Capital
Improvement Plan (CIP) and related capital outlay line item; minor capital outlays (less than $10,000)
will be included in the operating budget as small tools & equipment or repairs & maintenance.
The Capital Improvement Plan (CIP) differentiates the financing of high-cost, long-lived physical
improvements from low cost "consumable" equipment items contained in the operating budget. CIP
items may be funded through debt financing, a planned buildup of reserves, or current revenues while
operating budget items are annual or routine in nature and should only be financed from current
revenues.
6. Spending Policy: The city will spend its resources in the following order. Resources will be
categorized according to Generally Accepted Accounting Principles (GAAP) for state and local
governments, with the following general definitions:
• Restricted: Amounts constrained to specific purposes by their providers (such as grantors,
bondholders, and higher levels of government) through constitutional provisions or by
enabling legislation.
• Committed: Amounts constrained to specific purposes by the City Council by Resolution; to
be reported as committed, amounts cannot be used for any other purpose unless the City
Council takes action to remove or change the constraint also by Resolution.
• Assigned: Amounts the city intends to use for a specific purpose; intent can be expressed
by the council or by a designee to which the council delegates the authority. The City
Council delegated this authority to itself, City Administrator, or Finance Director.
• Unassigned: Amounts that are available for any purpose; these amounts are reported
only in the General Fund.
When both restricted and unrestricted resources are available, spending will occur in the
following order: Restricted, Committed, Assigned, Unassigned.
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.
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.
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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. The City
Council, City Administrator, or Finance Director can express intent.
• Unassigned fund balance: Amounts that are available for any purpose; these amounts are
reported only in the General Fund or a deficit in other fund types.
2. A minimum level of general fund reserve of 60-75% of annual operating expenditures will be
maintained. This reserve is committed to be used for cash flow purposes, unanticipated equipment
acquisition and replacement, and to otherwise enable the city to meet unexpected expenditure
demands (natural disasters, catastrophic events, etc.) or revenue shortfalls.
Property taxes represent the city's primary source of general fund revenue. Property taxes are
collected in June and December of each fiscal year. Since the city's fiscal year begins on January 1st, the
city must maintain an adequate cash balance to meet its expenditure obligations between semi-annual
collections of property taxes.
Accrued employee payroll benefits, such as sick leave, vacation, or paid time off, represent a
significant obligation of the city. The city will maintain sufficient reserves to meet its annual expenditure
obligations in the Benefit Accrual internal service fund.
The city recognizes the need to maintain adequate equipment to carry out required public
services. Equipment acquisition and replacement represent on-going costs of a minor nature, as
compared to major capital purchases. The city plans for equipment replacement within the Capital
Improvement Plan. However, unforeseen equipment problems will arise. The 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).
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GASB is recognized as the authority with respect to governmental accounting. Managing the
city's finances in accordance with GAAP and in accordance with the rules set forth by GASB provides
the Monticello residents assurance that their public funds are being accounted for in a proper manner.
2. The city will maintain its accounting records for general governmental operations on a modified
accrual basis, with revenues recorded when available and measurable, and expenditures recorded
when services or goods are received, and liabilities incurred. Accounting records for proprietary fund
types and similar trust funds will be maintained on an accrual basis, with all revenues recorded when
earned and expenses recorded when liabilities are incurred, without regard to timing of cash receipt or
payment.
Adherence to this policy will allow the city to prepare its financial statements in accordance with
Generally Accepted Accounting Principles as set by the Governmental Accounting Standards Board.
3. The city of Monticello will prepare an Annual Comprehensive Financial Report (ACFR) in
conformity with Generally Accepted Accounting Principles (GAAP). The report will be made available
to the public. The ACFR shall be prepared in accordance with the standards established by the GFOA
for the Certificate of Achievement for Excellence in Financial Reporting Program.
The Certificate of Achievement represents a significant accomplishment for a government and
its financial leadership. The program encourages governments to prepare and publish an easily readable
and understandable comprehensive annual financial report covering all funds and financial transactions
of the government during the year. The ACFR provides users with a wide variety of information useful in
evaluating the financial condition of a government. The program also encourages continued
improvement in the city's financial reporting practices.
4. The city will ensure the conduct of timely, effective, and annual audit coverage of all
financial records in compliance with Local, State, and Federal laws.
Audits of the city's financial records provide the public assurance that its funds are being
expended in accordance with Local, State, and Federal laws and in accordance with Generally Accepted
Accounting Principles. Audits also provide management and the City Council with suggestions for
improvement in its financial operations from independent experts in the accounting field.
5. The city of Monticello will maintain a policy of full and open public disclosure of all financial
activity.
Full and open public disclosure of all financial activity provides the public with assurance that its
elected officials and administrators communicate fully all financial matters affecting the public.
6. The modified accrual basis of accounting and budgeting is used for the governmental funds.
Under the modified accrual basis of accounting, revenues are recorded when susceptible to
accrual, i.e., both measurable and available. Available means collectible within the current period or soon
enough thereafter to be used to pay liabilities of the current period. Expenditures are recorded when the
related liability is incurred. Employee compensated absences and principal and interest on long-term
debt expenditures are recorded when due in the current period.
7. The 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
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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:
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.
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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
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
40
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
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.
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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.
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,
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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.
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
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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.
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
44
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.
POLICY CONSIDERATIONS
Any investment currently held that does not meet the guidelines of this policy shall be exempted
from the requirements of this policy. At maturity or liquidation, such monies shall be reinvested
only as provided by this policy.
This Statement of Cash Management and Investment Policy was adopted by motion/resolution
of the city’s mayor & council. The Finance Director and City Administrator will review this policy
annually. Any modifications made to this policy must be approved by resolution of the mayor &
council.
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BALANCED BUDGETS
A BALANCED BUDGET is as a situation where total revenues and other financing sources is equal
to (or greater than) total expenditures and other uses. Revenues and other financing sources
increase financial resources. Expenditures and other financing uses decrease financial resources.
A balanced budget does not dip into reserves or fund balances. However, an unbalanced budget
(deficit) is not necessarily poor fiscal management. For example, debt service funds often
accumulate resources in the year prior to expenditure, and debt-financed capital projects
frequently stretch over multiple years. The city has never used debt to finance current or
ongoing expenditures.
It is the city’s policy to adopt balanced budgets for the General Fund and the Community Center
Fund. Both funds are supported by property taxes.
Property Taxes 7,475,000$ Personnel Services $3,897,421
Franchise & Other Taxes 258,000 Supplies 874,870
Licenses & Permits 471,100 Other Services & Charges 5,751,709
Intergovernmental Revenues 463,000 Capital Outlay -
Charges for Services 1,118,600 Debt Service -
Fines & Forfeits 51,600 Operating Transfers 6,000
Special Assessments 100
Miscellaneous 692,600
Operating Transfers -
Total $10,530,000 Total $10,530,000
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
46
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 2022. Deficits reflect planned use of fund balance or future
bond issuance to reimburse for upfront costs.
$(1,800) $(1,400) $(1,000) $(600) $(200) $200 $600 $1,000
Benefit Accrual
Central Equipment
IT Services
Facilities Maintenance
Fiber Optics
Deputy Registrar
Liquor
Stormwater
Sewer
Water
Park Dedication
Park & Pathway Improvement
Street Lighting Improvement
Capital Projects
2020A G.O. Bonds
2019A G.O. Bonds
2018A G.O. Abatement
2017A G.O. Improvement/Abate
2016A G.O. Street/Improvement
2015B G.O. Street/Improvement
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. The Finance Director and City Administrator then meet with each
department director and supervisor to review the requests made. Requests are separated into
“buckets” including staffing, equipment, major non-capital, and capital expenditures. Each “bucket” is
discussed at the public budget workshops along with a comprehensive draft budget and projected
changes to the city’s tax capacity and levy. Significant increases or decreases from the previous budget
are highlighted to focus on high-level goals for the upcoming year. The council then gives feedback for
staff to research and present at the next public budget workshop. Following any adjustments to the
proposed budget, a preliminary tax levy resolution is prepared, and a public hearing is held in
September. The Council may again adjust the budget following the public hearing, after which time,
the Council adopts the final tax levy and final budget resolutions.
BUDGET CALENDAR/PROCEDURES
The following budget timeline outlines the process the city customarily follows for creation and
adoption of the 2022 budget.
Date Activity
May 12, 2021 2022-2026 capital equipment/projects (CIP) worksheets and budget
worksheets to department heads.
May 28, 2021 2022-2026 CIP and budget worksheets due to finance department
June, 2021
1. Department heads meet with various advisory boards and commissions for
input into 2022 preliminary budget and CIP.
2. Department directors and supervisors meet with city administrator and
finance staff to develop 2022 preliminary budget and CIP.
3. Finance department develops revenue estimates and 2022 preliminary
property tax levy.
July 19, 2021
Public City Council Budget Workshop #1. Workshops with city council, which
are open to the public, are held to set 2022 goals and priorities and review
draft department budgets and CIP.
July 26, 2021 Public City Council Budget Workshop #2
August 9, 2021 Public City Council Budget Workshop #3.
August 23, 2021 Public City Council Budget Workshop #4.
September 13, 2021 Public City Council Budget Workshop #5. Council adopts 2022 preliminary HRA
tax levy. (See September 30)
September 27, 2021 Council adopts 2022 preliminary city property tax levy. (See September 30)
September 30, 2021 2022 preliminary property tax levy certification due to Wright County auditor.
October/November, 2021 Department heads meet with city administrator and finance staff to refine
2022 proposed budget and final property tax levy. County mails TNT notices.
December 13, 2021 Council adopts 2022 budget and property tax levy. (See December 28)
December 28, 2021 City certifies final 2022 property tax levy to Wright County auditor and files
Form TNT with the MN Department of Revenue.
January 1, 2022 2022 fiscal year begins.
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PRESENTATION
The text of the budget document customarily contains six sections of information for each activity. Some
activities also include highlights or accomplishments for the prior year and/or the coming year.
• The first section provides a description of the activity.
• The second section describes its major objectives to be accomplished.
• The third section identifies issues/challenges the activity/division faces.
• The fourth section lists the workload/performance indicators for the division.
• The fifth section provides detailed financial information.
• The sixth section provides budget commentary.
The financial information includes expenditure information for the last two completed fiscal years, the
budgeted and 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.
MONITORING AND REPORTING PROCESS
As the budget year proceeds, individual departments and the Finance Department have dual
responsibility for monitoring the status of each budget unit. Department staff has primary responsibility
for monitoring the status of expenditures against their budget. This responsibility includes informing the
Finance Department of any significant departures from the plans anticipated in the budget.
The Finance Department has overall responsibility for monitoring the budget-to-actual status of all
departments and funds. This is accomplished primarily through analysis of computerized budget
performance reports which compare appropriation amounts on a line-item basis with actual
expenditures throughout the year. These reports aid department staff in controlling costs and 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.
The Finance Department reviews the budget reports and discusses any variances from expected
performance with the department staff. The Finance Department conducts in-depth budget
reviews of all expenditures and revenues in its quarterly report to council.
Significant changes in either expenditures or revenues may require a budget revision.
Recommendations are also made by the Finance Director for any recommended corrective actions. It is
the practice of the City of Monticello not to amend the budget unless absolutely necessary.
BUDGET AMENDMENT PROCESS
State statute provides various ways to amend the budget. This first involves a reallocation of existing
appropriations among the line items within a specific fund. The second defines a series of scenarios
where the governing body has authority to amend the budget without a hearing for donations, land
49
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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2022 ADOPTED BUDGETFinancial Summaries
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.
Debt amortization and early redemption of issues can lead to a significant decline in fund
balance for the Debt Service Fund. Multiple debt service sub-funds are aggregated into one
debt service fund for reporting purposes. The 2011A bonds will be paid off in 2022.
Capital Project Funds commonly accumulate resources in one budget period and expend those
resources over multiple budget periods. Expenditures of fund balance are anticipated in 2022,
which are expected to be reimbursed with bond proceeds in 2023.
Internal service funds provide services to other funds and typically function on a cost recovery
basis. The city has four: Facilities Maintenance Fund, IT Services Fund, Central Equipment Fund,
and Benefit Accrual Fund. Central Equipment Fund equipment purchases will exceed lease
revenue in 2022, but a transfer of excess General Fund balance in 2021 will fund the shortfall.
The Benefit Accrual Fund is the only internal service fund that is not used for capital asset
acquisitons.
Special Debt Capital Internal 2022
General Revenue Service Project Enterprise Service Total
Fund Funds Funds Funds Funds Funds Budget
Fund Balance/Working Capital - Jan. 1 6,635,073$ 8,401,401$ 1,259,211$ 16,568,711$ 23,698,715$ 3,676,682$ 60,239,792$
Revenues and Other Sources
Property Taxes 7,475,000$ 873,000$ 2,311,400$ 1,081,600$ -$ -$ 11,741,000$
Tax Increments - 630,344 - - - - 630,344
Franchise & Other Taxes 258,000 - - 140,000 - - 398,000
Sale of Goods - - - - 7,013,000 - 7,013,000
Licenses & Permits 471,100 - - - 2,000 - 473,100
Intergovernmental Revenues 463,000 425,000 - 900,000 - - 1,788,000
Charges for Services 1,118,600 931,900 - - 7,709,757 1,330,400 11,090,657
Fines & Forfeits 51,600 - - - - - 51,600
Special Assessments 100 - 222,472 207,671 38,000 - 468,243
Miscellaneous 692,600 67,756 7,203 261,729 135,243 14,600 1,179,131
Contributed Capital - - - - - - -
Operating Transfers In - 6,000 197,925 111,000 - - 314,925
Debt Proceeds - - - - - - -
Total Revenues and Other Sources 10,530,000$ 2,934,000$ 2,739,000$ 2,702,000$ 14,898,000$ 1,345,000$ 35,148,000$
Expenditures and Other Uses
Personnel Services 3,897,421 1,246,373 - - 2,278,593 243,848 7,666,235
Supplies 874,870 120,900 - - 5,699,100 172,420 6,867,290
Other Services & Charges 5,173,309 962,826 1,200 - 3,942,490 283,452 10,363,277
Capital Outlay 578,400 191,976 - 7,290,000 3,237,500 1,034,280 12,332,156
Debt Service - - 2,812,800 - 361,317 66,000 3,240,117
Operating Transfers Out 6,000 197,925 111,000 - - - 314,925
Total Expenditures and Other Uses 10,530,000 2,720,000 2,925,000 7,290,000 15,519,000 1,800,000 40,784,000
Net Change in
Fund Balance/Working Capital -$ 214,000$ (186,000)$ (4,588,000)$ (621,000)$ (455,000)$ (5,636,000)$
Fund Balance/Working Capital - Dec. 31 6,635,073$ 8,615,401$ 1,073,211$ 11,980,711$ 23,077,715$ 3,221,682$ 54,603,792$
All FUNDS SUMMARY - BY FUND TYPE
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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 64% of the total city
and HRA combined tax levy.
Property Taxes
34%Tax Increments
2%
Franchise &
Other Taxes
1%
Sale of Goods
20%
Licenses &
Permits
1%
Intergovernmental
Revenues
5%
Charges for Services
32%
Special
Assessments
1%
Miscellaneous
3%
Operating
Transfers In
1%
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 2022
budgeted revenues for these major categories for all funds combined. Debt proceeds are not
shown as the city does not anticipate issuing debt in 2022.
2022 Revenues by Category - All Funds
Property Taxes
67%
Franchise &
Other Taxes
2%
Licenses &
Permits
7%
Intergovernmental
Revenues
6%
Charges for
Services
11%
Fines & Forfeits
0.5%Miscellaneous
7%
2022 Revenues by Category -General Fund
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The General Fund is the city’s primary property tax levying fund, and it accounts for 30%
of the overall budgeted revenues of the city. This is an increase from 28% in 2021.
Special revenue funds, totaling 8% of appropriations (up from 7% in 2021), 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 8% of the city’s 2022 budgeted revenues and are supported with
property taxes, special assessments, and interfund operating transfers. This is a
decrease from 9% in 2021.
Capital project funds total 8% (down from 12% in 2021) of budgeted revenues, which
includes financing from bond proceeds (if applicable), special assessments, and
intergovernmental revenues for street construction, street lighting and park
improvements, and other governmental capital asset acquisitions excluding internal
service fund activity.
Enterprise funds consist of water, sewer, stormwater, liquor, deputy registrar (DMV),
and fiber optics funds. These funds operate on a self-supporting basis, mostly from the
sale of goods and charges for services. They are responsible for 42% of the overall
revenue appropriations, which is consistent with 2021.
Internal Service funds consist of facilities maintenance, IT services, central equipment,
and benefits accrual. These funds are supported by staff allocation or rental charges
from other funds of the city. Appropriations are 4% of the city’s 2022 budget, which is
consistent with 2021.
General
30%
Special Revenue
8%
Debt Service
8%
Capital Projects
8%
Enterprise
42%
Internal Service
4%
2022 Revenues by Fund Type
53
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 2022 budgeted expenditures for these six major
categories for all funds, combined.
APPROPRIATIONS BY TYPE, GENERAL FUND ONLY— Using those same categories of
expenditure type, the relative percentages of budgeted expenditures for the General Fund are
shown below. As you can see, the General Fund is comprised of a much higher percentage of
personnel services costs compared to all funds. The General Fund supports very little capital
improvements and no debt service compared to all funds overall.
Personnel
Services
19%
Supplies
17%
Other Services &
Charges
25%
Capital Outlay
30%
Debt Service
8%
Operating
Transfers Out
1%
2022 Appropriations by Category -All Funds
Personnel
Services
40%
Supplies
8%
Other Services &
Charges
48%
Capital Outlay
4%
2022 Appropriations by Category -General
Fund
54
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 26% of the overall appropriations of the city in 2022. This
is a decrease from 27% in 2021.
Special revenue funds, totaling 7% of 2022 appropriations (up from 6% in 2021), 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 7% of the city’s 2022 appropriations for bond principal and
interest payments. This is a decrease from 9% in 2021.
Capital project funds total 18% (up from 12% in 2021) of appropriations, which includes
costs for street construction, street lighting and park improvements, and other
governmental capital asset acquisitions excluding internal service funds. The city has
several large projects on the horizon with a significant amount of preparation and
beginning construction in 2022.
Enterprise funds consist of water, sewer, stormwater, liquor, deputy registrar (DMV),
and fiber optics funds. These funds operate on a self-supporting basis and are
responsible for 38% of the overall appropriations. This is up from 42% in 2021.
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 2022 budget, which is
consistent with 2021.
General
26%Special Revenue
7%
Debt Service
7%
Capital Projects
18%
Enterprise
38%
Internal Service
4%
2022 Appropriations by Fund Type
55
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 2022 budgeted
operating transfers:
Fund No.Transfer Out Fund Amount Fund No.Transfer In Fund Amount
213 Economic Development Authority 197,925$ 312 2011A GO Improvement Bond 197,925$
101 General 6,000 213 Economic Development Authority 6,000
312 2011A GO Refunding Bonds 111,000 400 Capital Projects 111,000
Total Transfers Out 314,925$ Total Transfers In 314,925$
SCHEDULE OF OPERATING TRANSFERS
56
ALL FUNDS SUMMARY BY YEAR
Intergovernmental revenues are projected to decrease in 2022 due the city receiving $2.1 million
of Federal funds in 2021 related to the Fallon Avenue Overpass project completed in 2018.
Special assessments were over budget in 2021 due to the payoff of a deferred assessment; the
2022 budget was not increased because it was a one-time receipt. Projected charges for services
increase due to an increase in rates and more activity in the internal service funds. Budgeted
fines & forfeits increased to be more in line with actual activity. Miscellaneous revenues budget
increases due to rebates from Xcel Energy on the city’s electric bills for a solar farm investment
through Novel Solar; the city increased its solar production load in 2021. As in 2021, no debt
issuances are planned in 2022.
Personnel services budget increased due to new positions in the General Fund and Liquor Fund,
and the first full year of the Facilities Maintenance Manager and IT Technician positions. A 3.0%
wage and health benefit increase are budgeted in 2022.
Estimated capital outlay expenditures increase due to several large projects on the horizon with
a significant amount of preparation and some beginning construction in 2022 including a new
TOTAL ALL FUNDS 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 10,353,018$ 10,836,757$ 11,430,000$ 11,540,278$ 11,741,000$ 2.7%
Tax Increments 679,925 707,824 617,344 732,688 630,344 2.1%
Franchise & Other Taxes 455,384 441,584 366,500 458,956 398,000 8.6%
Sale of Goods 6,374,153 7,404,955 6,679,000 7,104,357 7,013,000 5.0%
Licenses & Permits 607,180 524,464 422,300 810,239 473,100 12.0%
Intergovernmental Revenues 896,638 1,641,228 2,504,000 3,545,982 1,788,000 -28.6%
Charges for Services 10,702,814 10,339,585 9,815,000 12,465,064 11,090,657 13.0%
Fines & Forfeits 40,054 31,852 41,600 49,566 51,600 24.0%
Special Assessments 751,271 646,162 473,320 1,565,247 468,243 -1.1%
Miscellaneous 2,083,603 1,565,605 1,044,936 1,058,617 1,179,131 12.8%
Contributed Capital 303,840 780,114 - 316,795 - ---
Operating Transfers In 7,689,858 2,760,000 2,379,000 8,952,689 314,925 -86.8%
Debt Proceeds 8,131,662 2,256,280 - - - ---
TOTAL REVENUES 49,069,400$ 39,936,410$ 35,773,000$ 48,600,478$ 35,148,000$ -1.7%
EXPENDITURES
Personnel Services 6,279,102$ 6,152,627$ 6,822,275$ 6,547,110$ 7,666,235$ 12.4%
Supplies 5,973,021 6,672,104 6,397,619 6,463,849 6,867,290 7.3%
Other Services & Charges 9,223,854 10,314,137 9,629,056 9,752,396 10,363,277 7.6%
Capital Outlay 8,604,112 5,221,894 7,744,424 5,200,925 12,332,156 59.2%
Debt Service 4,123,174 4,274,436 3,758,626 7,314,973 3,240,117 -13.8%
Operating Transfers Out 7,554,858 2,760,000 2,379,000 8,952,689 314,925 -86.8%
TOTAL EXPENDITURES 41,758,121$ 35,395,198$ 36,731,000$ 44,231,942$ 40,784,000$ 11.0%
FUND BALANCE - JANUARY 1 44,018,765$ 51,330,044$ 55,871,256$ 55,871,256$ 60,239,792$
Excess (Deficiency) of
Revenues over Expenditures 7,311,279 4,541,212 (958,000) 4,368,536 (5,636,000)
FUND BALANCE - DECEMBER 31 51,330,044$ 55,871,256$ 54,913,256$ 60,239,792$ 54,603,792$
57
Public Works Facility, The Pointes at Cedar development area, Downtown improvements, SCADA
system upgrades, and the 2022 Street & Sidewalk Improvements project.
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 station would be an example of non-recurring capital expenditure. On
the other hand, the city budgets annually 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.
Debt service decreases in 2022 due to amortization of existing debt and no new debt issued. The
early redemption of one bond issue in 2021 caused a one-time large payment. Operating
transfers are lower in 2022 because prior year transfers were made to build up fund balances in
capital projects funds, but focus is shifting from planning to preparations and construction.
More detailed information on each fund, including the major funds, is included later in the
report.
58
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 2011A is projected to decrease due to the
payoff of the bonds in 2022. The 2016A and 2020A debt service subfunds fund balances are
projected to decrease by more than 10% to spend down prepaid assessment revenues
received. The 2019A bond subfund is budgeted to increase by more than 10% due to levying
105% of the 2022 payments, per the bond amortization schedule, to avoid cash shortfalls if
there are delinquencies in property tax payments.
The Capital Projects Fund, Street Lighting Fund, and Park & Pathway Improvement Fund are
budgeted to decrease by more than 10% due to the planned use of fund balance to support
projects. Reimbursement resolutions have been passed for activity related to the Public Works
Facility and Pointes at Cedar development area, which allows the City to bond in 2023 for
project costs expended in 2022. The Park Dedication Fund is projected to increase by more than
10% because it is a new fund, and activity is forecasted in 2022.
The Stormwater and Fiber Optics 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 net profits for future project use.
The Facilities Maintenance Fund shows a negative fund balance at the end of 2021, which will
be rectified with additional support from other city funds as part of the City’s year-end
adjustments that haven’t occurred yet. The Central Equipment Fund is expected to decrease by
more than 10% in 2022, which reflects the use of fund balance (transferred from the General
Fund in 2021) for some of the 2022 acquisitions.
59
Projected Beginning Projected Ending
Fund Balance/Estimated Fund Balance/
Working Capital Revenues Appropriations Working Capital
General Fund 6,635,011$ 10,530,000$ 10,530,000$ 6,635,011$
Special Revenue Funds
Economic Development 6,998,356 1,093,000 887,000 7,204,356
Cemetery 80,183 33,000 33,000 80,183
Minnesota Investment 924,622 8,000 - 932,622
Monticello Community Center 399,738 1,800,000 1,800,000 399,738
Total Special Revenue Funds 8,402,899 2,934,000 2,720,000 8,616,899
Debt Service Funds
2011A G.O. Refunding Bond 109,551 198,000 310,000 (2,449)
2015B G.O. Street/Improvement 135,876 216,000 211,000 140,876
2016A G.O. Street/Improvement 368,685 487,000 528,000 327,685
2017A G.O. Improvement/Abate 280,979 470,000 471,000 279,979
2018A G.O. Abatement 80,503 453,000 448,000 85,503
2019A G.O. Bonds 49,780 724,000 719,000 54,780
2020A G.O. Bonds 98,836 191,000 238,000 51,836
Total Debt Service Funds 1,124,210 2,739,000 2,925,000 938,210
Capital Project Funds
Capital Projects 14,692,497 2,547,000 6,490,000 10,749,497
Street Lighting Improvement 1,180,207 150,000 425,000 905,207
Park & Pathway Improvement 1,098,433 2,000 375,000 725,433
Park Dedication 41 3,000 - 3,041
Total Capital Project Funds 16,971,178 2,702,000 7,290,000 12,383,178
Enterprise Funds
Water 6,327,857 1,670,000 1,745,000 6,252,857
Sewer 9,387,251 3,050,000 3,476,000 8,961,251
Stormwater 2,800,197 448,000 1,382,000 1,866,197
Liquor 2,002,948 7,025,000 6,235,000 2,792,948
Deputy Registrar 2,179,232 825,000 731,000 2,273,232
Fiber Optics 699,248 1,880,000 1,950,000 629,248
Total Enterprise Funds 23,396,732 14,898,000 15,519,000 22,775,732
Internal Service Funds (1) (1)
Facilities Maintenance (33,855) 325,000 325,000 (33,855)
IT Services 225,092 425,000 425,000 225,092
Central Equipment 3,127,165 583,000 1,038,000 2,672,165
Benefit Accrual 353,114 12,000 12,000 353,114
Total Internal Service Funds 3,671,516 1,345,000 1,800,000 3,216,516
Total All Funds 60,201,546$ 35,148,000$ 40,784,000$ 54,565,546$
CHANGES IN FUND BALANCE/WORKING CAPITAL - FISCAL YEAR 2022
60
Adopted
Actual Actual B udget Projected Budget
2019 2020 2021 2021 2022
General Fund 6,677,250$ 6,640,235$ 6,640,235$ 6,635,011$ 6,635,011$
Special Revenue Funds
Economic Development 7,313,264 6,520,980 6,888,980 6,998,356 7,204,356
Cemetery 26,075 55,339 55,339 80,183 80,183
Minnesota Investment 904,365 924,538 929,538 924,622 932,622
Monticello Community Center 239,482 52,357 52,357 399,738 399,738
Total Special Revenue Funds 8,483,186 7,553,214 7,926,214 8,402,899 8,616,899
Debt Service Funds
2011A G.O. Refunding Bond (2005A)893,148 111,460 112,460 109,551 (2,449)
2014A G.O. Judgment Bonds 121,688 148,714 150,714 - -
2015B G.O. Street/Improvement 109,416 121,687 132,687 135,876 140,876
2016A G.O. Street/Improvement 366,626 399,967 361,967 368,685 327,685
2017A G.O. Improvement/Abatement 268,629 278,557 279,557 280,979 279,979
2018A G.O. Improvement/Abatement 57,043 79,719 81,719 80,503 85,503
2019A G.O. Bonds 5,011 39,494 54,494 49,780 54,780
2020A G.O. Bonds - 124,934 75,934 98,836 51,836
Total Debt Service Funds 1,821,561 1,304,532 1,249,532 1,124,210 938,210
Capital Project Funds (1)
Capital Project 14,408,703 16,243,546 17,246,546 14,692,497 10,749,497
Street Lighting Improvement 788,504 995,928 995,928 1,180,207 905,207
Park & Pathway Improvement 939,341 716,445 1,107,445 1,098,433 725,433
Park Dedication - - - 41 3,041
Closed Bond Fund 791,698 914,050 1,070,050 - -
Streets Reconstruction 1,633,770 1,667,656 13,656 - -
Total Capital Project Funds 18,562,016 20,537,625 20,433,625 16,971,178 12,383,178
Enterprise Funds
Water 4,931,247 5,280,477 4,945,477 6,327,857 6,252,857
Sewer 5,513,530 7,285,407 6,526,407 9,387,251 8,961,251
Stormwater 1,488,947 2,284,845 1,874,845 2,800,197 1,866,197
Liquor 600,060 1,014,600 1,439,600 2,002,948 2,792,948
Deputy Registrar 1,527,728 1,848,750 1,905,750 2,179,232 2,273,232
Fiber Optics 229,339 401,584 237,584 699,248 629,248
Total Enterprise Funds 14,290,851 18,115,663 16,929,663 23,396,732 22,775,732
Internal Service Funds (1)
Facilities Maintenance - - - (33,855) (33,855)
IT Services 382,557 267,384 267,384 225,092 225,092
Central Equipment 629,537 962,590 973,590 3,127,165 2,672,165
Benefit Accrual 348,086 355,013 358,013 353,114 353,114
Total Internal Service Funds 1,360,180 1,584,987 1,598,987 3,671,516 3,216,517
Total All Funds 51,195,044$ 55,736,256$ 54,778,256$ 60,201,546$ 54,565,546$
FUND BALANCE/WORKING CAPITAL HISTORY
Fiscal Year Ended December 31,
61
REVENUE TRENDS & ANALYSIS
Revenues are conservatively estimated for every fund type. The schedule of revenue estimates
below is supported by detailed revenue estimates for each fund in subsequent sections. This
section of the budget highlights major revenue sources for all the city funds as combined and for
key governmental and enterprise funds: General Fund and Monticello Community Center Fund
(governmental funds), along with the Water, Sewer, Stormwater, Liquor, Deputy Registrar and
Fiber Optics funds (enterprise funds). Trends for these funds and individual revenues are shown
together with estimates for the coming year.
TOTAL CITY REVENUES AND OTHER SOURCES
Property taxes, charged to all non-exempt parcels in city limits, account for the single largest
revenue source for the city. Property taxes are levied for the following funds: General,
Monticello Community Center, Debt Service, Capital Projects, and Economic Development
Authority. Budget estimates are based off the final levy certified.
Tax increments are the main source of revenue for the Economic Development Fund accounting
for 58% of 2022 budgeted revenues. This fund accounts for the city’s tax increment financing
(TIF) districts and other general economic development activities of the Monticello Economic
Development Authority. Budget estimates are taken from the prior year’s TIF collections and
adjusted for known changes to each TIF district.
Sales of goods reflect sales at the city’s Hi-Way Liquors off-sale store. Budget estimates are
calculated using analysis of the actual sales trends over the past 3-5 years.
Intergovernmental revenues will decrease due to the receipt of $2.1 million of Federal funds
received in 2021 for the Fallon Avenue Overpass project. With a strong commercial tax base,
the city generally does not qualify for state aid that is not project specific. However, 2022’s
budget includes the city’s second tranche of American Rescue Plan Act (ARPA) funds along with
recurring and awarded one-time state and county grants.
Charges for services reflect increases in the city’s fee schedule, including refuse and recycling
charges and community center membership and day pass fees. The city uses conservative
TOTAL ALL FUNDS 2019 2020 2021 2021 2022 %
REVEN UES ACTUAL ACTUAL BUDGET PROJ ECTED BUDGET CHANGE
Property Taxes 10,353,018$ 10,836,757$ 11,430,000$ 11,540,278$ 11,741,000$ 2.7%
Tax Increments 679,925 707,824 617,344 732,688 630,344 2.1%
Franchise & Other Taxes 455,384 441,584 366,500 461,898 398,000 8.6%
Sale of Goods 6,374,153 7,404,955 6,679,000 7,104,357 7,013,000 5.0%
Licenses & Permits 607,180 524,464 422,300 810,239 473,100 12.0%
Intergovernmental Revenues 896,638 1,641,228 2,504,000 4,017,667 1,788,000 -28.6%
Charges for Services 10,171,955 9,976,755 9,740,000 11,748,550 11,015,657 13.1%
Fines & Forfeits 40,054 31,852 41,600 49,566 51,600 24.0%
Special Assessments 751,271 646,162 473,320 1,565,247 468,243 -1.1%
Miscellaneous 2,083,603 1,565,605 1,044,936 1,062,247 1,179,131 12.8%
Contributed Capital 834,699 1,142,944 75,000 981,521 75,000 0.0%
Operating Transfers In 7,554,858 2,760,000 2,379,000 8,952,689 314,925 -86.8%
Debt Proceeds 8,131,662 2,256,280 - - - ---
TOTAL REVENUES 48,934,400$ 39,936,410$ 35,773,000$ 49,026,947$ 35,148,000$ -1.7%
62
revenue budgeting practices to ensure revenues will be sufficient to meet operating needs. The
effects of the COVID-19 pandemic have made projecting charges for services at the Monticello
Community Center especially challenging.
Miscellaneous revenues, including donations, interest earned on investments, and rebates
related to a solar farm investment, are conservatively estimated based on prior year trends.
Known factors, such as the number of kilowatt-hours (kWh) subscribed in the solar program,
are factored into the 2022 budget. While the investment earnings—the largest portion of this
revenue classification—are expected to hold steady, adjustments to market value create
volatility that makes estimating difficult.
Operating transfers in are expected to decrease in 2022 because the only anticipated transfers
are related to a small operating transfer from the City to the EDA, a bond payoff and fund
closure, whereas prior budgets typically included other transfers for up front capital funding
that is not planned in 2022.
No debt issuances are scheduled for 2022.
The chart below provides an overall picture of estimated 2022 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, capital outlay and debt service. For 2022, the
council adopted a general levy of $11,353,000, which is $289,300 (2.6%) greater than the prior
year. The council also adopted a Housing and Redevelopment Authority (HRA) special benefit
levy of $388,000, which is $21,700 (5.9%) greater than 2021. The HRA levy is recorded in the
Economic Development Authority (EDA) Fund.
Property Taxes
34%
Tax Increments
2%
Franchise &
Other Taxes
1%
Sale of Goods
20%
Licenses &
Permits
1%
Intergovernmental
Revenues
5%Charges for
Services
32%
Fines & Forfeits
0%Special
Assessments
1%
Miscellaneous
3%
Operating
Transfers In
1%
2022 Revenues by Category -All Funds
63
The following chart reflects the changes in the tax levy over the last ten years:
Accounting for a variety of activities, the General Fund will receive 64% of the 2022 property
tax levy. However, property taxes provide 71% of the General Fund’s revenue. The levy for the
Monticello Community Center (MCC) is maintained at $485,000. The following chart represents
the distribution of the tax levy for 2022.
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.
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 $10,530,000 (+6.6%) for the 2022 budget year. The primary General
Fund source of revenue is property taxes at $7,475,000 (+4.3%), which accounts for 71% of total
revenues. At 11% and 6%, charges for services and miscellaneous revenues are the only other
categories to exceed 5% of total revenues.
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
City & HRA Property Tax Levy
City Tax Levy HRA Levy
General Fund
$7,475,000
64%
MCC Operations
$485,000
4%
HRA Levy
$388,000
3%
Capital
$1,081,600
9%
Debt Service
$2,311,400
20%
Property Tax Levy (Adopted 2022)
64
The following charts depicts General Fund revenues as represented in the 2022 adopted budget:
The following chart represents General Fund revenues trends.
MONTICELLO COMMUNITY CENTER
The Monticello Community Center (MCC) provides a facility with space for a variety of
recreational, professional, and educational opportunities. Aside from its portion of the property
tax levy, the MCC is supported by a variety of fees for memberships, activities, rentals, and
concessions. Council passed a revenue policy that requires the MCC to cover 85% of its operating
costs—including equipment—with fees and charges. The effects of the COVID-19 pandemic have
affected the ability of this fund to meet that threshold.
General Fund Revenues -2022
Property Taxes (71%)
Franchise & Other Taxes (3%)
Licenses & Permits (4%)
Intergovernmental Revenues (4%)
Charges for Services (11%)
All Other (7%)
$-
$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
$11,000,000
ACTUAL ACTUAL BUDGET BUDGET
2019 2020 2021 2022
Revenues -General Fund
Miscellaneous
Fines & Forfeits
Charges for Services
Intergovernmental
Revenues
Licenses & Permits
Franchise & Other Taxes
Property Taxes
65
In the following chart, 2019 and 2020 are actual amounts and 2021 and 2022 are estimates.
WATER AND SEWER FUNDS
Water and sewer charges for services are primarily comprised of providing Monticello residents
and businesses with water and sewer services. Based partially on the level of consumption, these
utility funds each have separate charges for delivered services. The city sets rates to cover
operating costs, a portion of depreciation, and debt service. The water and sewer funds are
expected to provide some level of future support for debt service incurred to make water and
sewer system improvements.
In 2018, the sewer fund shows increased revenue because the city sold a parcel of property that
had been used for storage and a bio-solids site. With 2022 shown as a projected amount, the
following chart plots revenues for water and sewer services on the primary axis (left) against
gallons of water sold on the secondary axis (right):
Water service charges have two components: base charge with a minimum usage amount and
consumption charge for usage above the minimum amount. Rates have increased steadily over
the last ten years: average annual base and consumption charge increases were 5.6%. Sewer
charges, like water charges, have two components: base charge with a minimum usage amount
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
ACTUAL ACTUAL BUDGET BUDGET
2019 2020 2021 2022
Revenues -Community Center Fund
Operating Transfers In
Miscellaneous
Charges for Services
Property Taxes
0
100
200
300
400
500
600
700
$0.0
$0.5
$1.0
$1.5
$2.0
$2.5
$3.0
$3.5
$4.0
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Gallons Sold (Millions)Revenues (Millions)Water & Sewer Revenues
Water Revenue
Sewer Revenue
H20 Sold (Gallons)
66
and consumption charge for usage above the minimum amount. Rates have increased steadily
over the years: average annual base and consumption charge increases were 5.1%. For 2022,
increases of 3% for both the base rate and usage rates were included in the budget for both funds.
The following chart reflects the water and sewer base rates over the last ten years:
STORMWATER FUND
The Stormwater Fund was established in 2019 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
$4/month in 2022. Expenses in this fund were accounted for in the General fund prior to 2020.
DEPUTY REGISTRAR (DMV)
The city is authorized by the State of Minnesota to operate a DMV. Fees collected from motor
vehicle licenses are the DMV’s main revenue source. Fees are regulated by the state.
The following chart shows the history of DMV transactions over a five-year period. The State
transitioned to the MNLARS system in 2019 and to MNDrive in 2020. All three systems measured
transactions differently which creates skewed numbers in the graph below. Nevertheless, 2020
and 2021 were incredibly busy years for the DMV as the COVID-19 pandemic caused changes in
operations and increased car sales contributed to increased workload.
$-
$2
$4
$6
$8
$10
$12
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022Monthly ChargeWater and Sewer Base Rates
Water
Sewer
$-
$200,000
$400,000
$600,000
$800,000
$1,000,000
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
2017 2018 2019 2020 2021
DMV Transactions by Type & Annual Revenues
Drivers License ($8)
Game & Fish ($1)
DNR ($2-$7)
Motor vehicle ($6-$10)
Annual Revenue
67
Motor vehicle licenses (new and renewals) as percentage of total transactions decreased slightly
from 91% in 2020 to 87% in 2021.
LIQUOR FUND
With total 2021 sales of $7.1 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 slowed in 2021 as stay-at-home orders only occurred in 2020 and
more people were dining out and enjoying on-sale venues once again. Total sales have climbed an
average of 5.7% for the last five years (16.2% alone in 2020); liquor is the fastest growth category
averaging 7.2% over five years.
The 2022 Liquor Fund budget reflects the increasing sales 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, 2022 net cash flow from operations should top $1,000,000.
Beer accounts for approximately 51% of total sales; liquor and wine follow at 32% and 13%,
respectively. Non-alcohol items contribute 4%. Beer typically has the lowest gross margin at 23%
and wine the highest at 39%. Liquor is in the middle at about 31%. The chart below provides sales
information by category:
Beer
51%
Liquor
32%
Wine
13%
Misc.
4%
Hi-Way Sales by Category -2021
Liquor Store Revenue by Category
Category 2017 2018 2019 2020 2021 5 Yr Chg
Beer 2,933,853$ 3,074,408$ 3,252,142$ 3,838,912$ 3,665,223$ 25%
% Change 6.0% 4.8% 5.8% 18.0% -4.5%
Liquor 1,739,562$ 1,909,953$ 2,019,096$ 2,351,072$ 2,276,808$ 31%
% Change 7.1% 9.8% 5.7% 16.4% -3.2%
Wine 894,151$ 904,385$ 894,005$ 982,113$ 915,444$ 2%
% Change 0.6% 1.1% -1.1% 9.9% -6.8%
Other 192,616$ 201,462$ 211,687$ 235,777$ 253,776$ 32%
% Change 12.4% 4.6% 5.1% 11.4% 7.6%
Total Sales 5,757,137$ 6,090,208$ 6,376,930$ 7,407,874$ 7,111,250$ 24%
% Change 5.6% 5.8% 4.7% 16.2% -4.0%
68
FIBER OPTICS FUND (FiberNet)
Monticello’s telecommunications utility, FiberNet Monticello, provides internet, voice (telephone)
and video (TV) services. City residential and commercial customers can subscribe to one, two, or all
three services. FiberNet continues to face competition from two large private providers with
significant resources and challenges with the societal shift away from traditional telephone and
television services. As a result, subscriber counts for voice and video have declined in recent years.
Internet has shown occasional growth with more customers streaming video services.
The data in the graphs below show a stable competitive environment for FiberNet in 2021.
In July 2016, the city contracted with Arvig to manage FiberNet. The contract was renewed for an
additional 5 years in 2021. Through leaner operations, shared resources, and economies of scale,
the Fiber Optics Fund has had positive cash flow from operations since 2019. However, potential
new service areas will cause increases in capital costs. Arvig will continue to assess the marketplace
and service delivery costs and will raise prices as needed.
1,801 1,800 1,805 1,812 1,812 1,817 1,814 1,812 1,819 1,816 1,807 1,808
323 313 297 300 294 294 294 299 295 297 291 289
315 306 302 304 302 303 302 300 301 298 297 297
0
500
1,000
1,500
2,000
2,500
2021 Total Subscribed Services
Phone
Television
Internet
69
TAX LEVY HISTORY
2019 2020 2021 2022
General Fund $6,670,000 $6,788,000 $7,169,000 $7,475,000
Percent Change 4.8% 1.8% 5.6% 4.3%
Special Revenue Funds
Economic Development (HRA Levy)348,000 355,000 366,300 388,000
Monticello Community Center 402,000 417,000 485,000 485,000
Total Special Revenue Funds 750,000 772,000 851,300 873,000
Percent Change 8.9% 2.9% 10.3% 2.5%
Debt Service Fund
2011A GO Refunding Bonds 150,581 172,641 - -
2014A GO Judgement Bonds 537,244 535,501 513,570 -
2015B GO Bonds 200,905 198,385 201,115 192,650
2016A GO Bonds 409,134 405,039 406,089 406,929
2017A GO Bonds 429,782 427,367 430,097 427,367
2018A GO Bonds 500,000 472,434 448,077 451,812
2019A GO Bonds - 728,620 714,945 709,446
2020A GO Bonds - - 117,586 123,196
Total Debt Service Fund 2,227,646 2,939,987 2,831,479 2,311,400
Percent Change -26.7% 32.0% -3.7% -18.4%
Capital Project Funds
Capital Projects Fund 662,354 300,013 578,221 1,081,600
Total Capital Project Funds 662,354 300,013 578,221 1,081,600
Percent Change 1466.0% -54.7% 92.7% 87.1%
Total Tax Levy - All Funds 10,310,000$ 10,800,000$ 11,430,000$ 11,741,000$
Percent Change 4.7% 4.8% 5.8% 2.7%
Levy Summary
City General and Debt Levies 9,962,000$ 10,445,000$ 11,063,700$ 11,353,000$
Percent Change 4.3% 4.8% 5.9% 2.6%
HRA Levy 348,000$ 355,000$ 366,300$ 388,000$
Percent Change 15.4% 2.0% 3.2% 5.9%
TAX LEVY HISTORY
70
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 2021 totaled
$2,135,371,400. HRA levy proceeds can only be used for purposes included in the HRA Act
(Minnesota Statutes, Section 469.033, subd. 6). Those purposes include redevelopment to
correct or prevent blight and development of, or assistance to, housing for low- or moderate-
income persons.
In 2021, Northern States Power (dba Xcel Energy), the city’s largest taxpayer, succeeded in
getting the Minnesota Department of Revenue to lower the estimated market value of its
nuclear power plant. Xcel’s estimated market value dropped by 7%, and because residential
and commercial tax base grew, the city’s tax capacity decreased, and the tax burden shifted
away from Xcel to the other taxpayers.
The graph below reflects the annual change in the city’s property tax levy and the annual
change in Xcel’s property taxes owed. When the green column is larger than the blue column,
Xcel absorbed the entire levy and lowered the taxes paid by others. In 2019, the green column
was in negative territory. In this case, other taxpayers picked up the entire levy increase plus
the amount Xcel’s taxes declined.
2019 2020 2021 2022
Tax Capacity 29,076,227$ 29,870,392$ 31,026,583$ 30,816,639$
Percent Change -1.5% 2.7% 3.9% -0.7%
City Levy - Tax Capacity Rate 34.262 34.968 35.659 36.840
Percent Change 6.0% 2.1% 2.0% 3.3%
HRA Levy - Tax Capacity Rate 1.197 1.188 1.181 1.259
Percent Change 9.4% -0.7% -0.7% 6.6%
TAX CAPACITY HISTORY
$(400,000)
$(300,000)
$(200,000)
$(100,000)
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
2018 2019 2020 2021 2022
City Levy and Xcel Property Tax Change
City Levy Increase Xcel Change in City Taxes
71
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%. The percentage has continued to decline,
and 2022 estimates calculate Xcel’s percentage of tax base at 48%. This tax capacity decline
means the city’s other taxpayers absorbed more of the tax levy.
Tax
Year Amount $ Change Amount $ Change % Chg.Amount $ Change % Chg.
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% 5,410,467$ (266,029)$ -5%
2020 780,422,700$ (9,149,800)$ 15,608,454$ (182,996)$ -1% 5,457,964$ 47,497$ 1%
2021 806,039,800$ 25,617,100$ 16,120,796$ 512,342$ 3% 5,748,515$ 290,551$ 5%
2022 751,329,900$ (54,709,900)$ 15,026,598$ (1,094,198)$ -7% 5,535,799$ (212,716)$ -4%
Northern States Power (dba Xcel Energy)
Taxable Market Value Tax Capacity City Property Tax on Plant
$479 $448
$707
$780 $832 $878
$790 $780 $806 $751
$-
$100
$200
$300
$400
$500
$600
$700
$800
$900
$1,000
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022MillionsXcel Power Plant -Taxable Market Value
72
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73
REVENUE SOURCES BY FUND
Revenue Classifications
Property Tax Franchise Sale of Licenses/ Intergovern-
Taxes Increments & Other Goods Permits mental
General Fund 7,475,000$ -$ 258,000$ -$ 471,100$ 463,000$
Special Revenue Funds
Economic Development 388,000 630,344 - - - 25,000
Cemetery - - - - - -
Small Cities Development Program - - - - - -
Monticello Community Center 485,000 - - - - 400,000
Total Special Revenue Funds 873,000 630,344 - - - 425,000
Debt Service Funds
2011A G.O. Refunding Bonds - - - - - -
2015B G.O. Bonds 192,650 - - - - -
2016A G.O. Bonds 406,929 - - - - -
2017A G.O. Bonds 427,367 - - - - -
2018A G.O. Bonds $451,812 - - - - -
2019A G.O. Bonds 709,446 - - - - -
2020A G.O. Bonds 123,196 - - - - -
2022A G.O. Bonds - - - - - -
Total Debt Service Funds 2,311,400 - - - - -
Capital Project Funds
Capital Project 1,081,600 - - - - 900,000
Street Lighting Improvement - - 140,000 - - -
Park & Pathway Improvement - - - - - -
Park Dedication - - - - - -
Total Capital Project Funds 1,081,600 - 140,000 - - 900,000
Enterprise Funds
Water - - - - 2,000 -
Sewer - - - - - -
Stormwater - - - - - -
Liquor - - - 7,013,000 - -
Deputy Registrar - - - - - -
Fiber Optics - - - - - -
Total Enterprise Funds - - - 7,013,000 2,000 -
Internal Service Funds
Facilities Maintenance - - - - - -
IT Services - - - - - -
Central Equipment - - - - - -
Benefit Accrual - - - - - -
Total Internal Service Funds - - - - - -
Total All Funds 11,741,000$ 630,344$ 398,000$ 7,013,000$ 473,100$ 1,788,000$
74
Revenue Classifications
Charges for Fines & Special Miscell- Contributed Operating Debt
Services Forfiets Assessments aneous Capital Transfers Proceeds Total
1,118,600$ 51,600$ 100$ 692,600$ -$ -$ -$ 10,530,000$
- - - 43,656 - 6,000 - 1,093,000
32,900 - - 100 - - - 33,000
- - - 8,000 - - - 8,000
899,000 - - 16,000 - - - 1,800,000
931,900 - - 67,756 - 6,000 - 2,934,000
- - - 75 - 197,925 - 198,000
- - 21,776 1,574 - - - 216,000
- - 78,800 1,271 - - - 487,000
- - 41,120 1,513 - - - 470,000
- - - 1,188 - - - 453,000
- - 13,810 744 - - - 724,000
- - 66,966 838 - - - 191,000
- - - - - - - -
- - 222,472 7,203 - 197,925 - 2,739,000
- - 205,575 248,825 - 111,000 - 2,547,000
- - - 10,000 - - - 150,000
- - - 2,000 - - - 2,000
- - 2,096 904 - - - 3,000
- - 207,671 261,729 - 111,000 - 2,702,000
1,574,049 - 38,000 55,951 - - - 1,670,000
3,020,000 - - 30,000 - - - 3,050,000
446,000 - - 2,000 - - - 448,000
- - - 12,000 - - - 7,025,000
800,000 - - 25,000 - - - 825,000
1,869,708 - - 10,292 - - - 1,880,000
7,709,757 - 38,000 135,243 - - - 14,898,000
325,000 - - - - - - 325,000
421,000 - - 4,000 - - - 425,000
572,400 - - 10,600 - - - 583,000
12,000 - - - - - - 12,000
1,330,400 - - 14,600 - - - 1,345,000
11,090,657$ 51,600$ 468,243$ 1,179,131$ -$ 314,925$ -$ 35,148,000$
75
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 i n 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
expendi tures 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 R&M items and capital
expenditures could be
supported by transfers from
other funds. The only CIP
purchases budgeted in 2022
are for small tools and
equipment or building
repairs run through the
operating budget and
security cameras run
through the IT Services
internal service fund.
Tax increment financing (TIF)
expenditures will vary
consi derably from year-to-
year in each district as
development occurs.
Large capital projects may
receive funding from debt
issuance, typically as a
reimbursement of spent
reserves.
A street and sidewalk
improvement project is
included in the 2022 budget
along with work at the
Pointes at Cedar
development area.
Revenues
Property taxes provide over
70% of General Fund
revenue. The budget is
somewhat limited by
sustainable growth in the tax
levy. The city looks to
diversify revenues by
implementing more charges
for services, as applicable.
Additional revenue is earned
from a solar farm investment
that began in 2020.
The property tax levy is set at
$485K in 2022. 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.
The fund has been kept
solvent with a transfer from
the liquor fund and ARPA
Federal grant dollars.
Tax increment revenues
widely vary from district to
distri ct but not much from
year-to-year. Often reserves
(accumulation of prior year
increments) are used to fund
projects. The 2022 levy is
$388,000.
In the past, state street aid
has been used as temporary
financi ng 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
servi ce 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.
2022: 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 2023-2024.
Payments on these bonds
will be structured to take
advantage of the decline in
other tax supported debt.
76
Water Sewer Liquor Fiber Optics Central Equipment
Expected to rise at the
pace of inflation but
miti gated by reinvestment
in plant and equipment.
Annual capital
expenditures financed on
a pay-as-you-go basis are
estimated at $610,000.
Expected to rise at the
pace of inflation but
miti gated 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
increa ses 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 i n 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
widel y 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.
2022: $400k SCADA
systems.
2025: $28M water
treatment facility.
2026: $1.2M Well 6.
2022: $800k SCADA
systems.
2023: $500k CSAH 39
extension.
2024: $5M Fallon Avenue
improvements; $750k
Marvin Rd lift station
2025: $5.375M WWTP
solids handling,
headworks, & phase 2
improvements.
The fund generates
sufficient annual
revenues to support its
needs.
2023: $75k for parking lot
improvements.
2025: $50K for roof
repairs.
Operating revenues are
not quite adequate to
support non-routine
expenditures. However,
non-routine expenditures
are tied to development,
which is unpredictable.
Reserves from recent
operating revenues have
been sufficient.
Anticipated future
expenditure by year:
2022: $972k; 2023: $837k;
2024: $911k; 2025: $426k;
2026: 2026: $980k
The CIP reflects ideal
timing for replacement of
equipment, but will be
adjusted as financing
allows.
User rates are high
enough to cover planned
expendi tures for the next
five years. A rate study is
included in the 2022
budget, offset by a MN
DEED grant, 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 2022
budget, offset by a MN
DEED grant, to ensure
rates will be sufficient.
Sales have increased
steadily up until the
COVID pandemic. 2020
was a record year for
sales, posting a 16.2%
increase. The growth was
not sustainable, and the
2021 sales decreased
3.5%. Sales are expected
to return to normal
annual increases around
5% in the coming years.
Transfers from Liquor
Fund have not been
needed s i nce 2019 due to
operational changes in
the management of
FiberNet. The original
agreement with Arvig
expired on June 30, 2021,
and the contract was re-
negotiated for an
additional 5 years term
through mid-2026.
Rental revenues
(expenditures in other
funds, funded by revenues
sources in other funds)
rise with equipment
purchases. Excess fund
balance in the General
Fund at the end of 2021
was transferred in for
future purchases.
No debt issues or
Minnesota Public
Facilities Authority
(MPFA) loans are
anticipated unless
external funding is
received related to
construction of a Water
Treatment Facility (if so,
construction is tentatively
projected in 2025).
The Minnesota Public
Facilities Authority
(MPFA) may provide
funding for the future
projects. Revenue bonds
may be sold if reserves
are depleted.
No debt issues are
anticipated over next five
years .
The 2014A Judgment
Bonds related to prior
acti vity in this fund was
paid off in 2021, freeing
up capacity for other debt
outside of this fund. No
new debt is planned for
the future.
The fund is expected to
become self-sustaining.
The 2014A Equipment
Bonds, which have final
payment in 2024, are paid
out of this fund. Future
debt issues will not be
needed if acquisitions
listed in the CIP are
adjusted to provide for
more level purchases
from year to year.
77
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 Sewer. 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 2022 budget and for
future year projections. After 2022, 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.
Like the General Fund, the Monticello Community Center (MCC) Fund normally adopts a
balanced budget. However, changes caused by the COVID-19 pandemic created budgetary
challenges for the fund, relying on a transfer from the Liquor Fund in 2020 to avoid a fund
$-
$2
$4
$6
$8
$10
$12
$14
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028MillionsGeneral Fund 2019-2028
Fund Balance Revenues/Sources Expenditures/Uses
78
balance deficit. The American Rescue Plan Act (ARPA) passed in 2021 provided funding to
support the MCC Fund, and even allowed the Fund to transfer the assistance received from the
Liquor Fund in 2020 to the Capital Projects Fund for future capital use. 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
has adequate reserves to cover almost any expenditure for major capital projects, with none
scheduled in the next couple years. A new water treatment plant is tentatively projected for
2025 construction, depending on receipt of external funding sources. The city’s share of costs
would likely require the issuance of debt. A new well is planned for 2026. A rate study is
budgeted for 2022 to ensure rates will continue to cover operations and most capital
improvements.
Unlike the Water Fund, the Sewer Fund represents funding challenges. Environmental
regulatory changes require large investments in the wastewater treatment plant. Debt
$-
$1
$2
$3
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028MillionsMonticello Community Center Fund 2019-2028
Fund Balance Revenues/Sources Expenditures/Uses
$-
$3
$6
$9
$12
$15
$18
$21
$24
$27
$30
$33
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028MillionsWater Fund 2019-2028
Working Capital Revenues/Sources Expenditures/Uses
79
supported wastewater treatment plant improvements are planned for 2024 and 2025. Along
with the water fund, a rate study is budgeted for 2022 to ensure rates will continue to cover
operations, most capital improvements, and debt service.
$-
$2
$4
$6
$8
$10
$12
$14
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028MillionsSewer Fund 2019-2028
Working Capital Revenues/Sources Expenditures/Uses
80
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.
Considering 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 71% 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 decline in assessed value
at the nuclear power plant causes a tax shift to other property taxpayers in the city, so the levy
was held at a 2.7% increase. 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.
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.
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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. 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.
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
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agreements in place on a variety of local and regional issues in planning, public safety and
public works initiatives.
Recent steps taken to achieve long-term fiscal objectives:
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 2022, the garbage charge rises to $9.73, relaying 100% of the
city’s cost to the user. The recycling charge added in 2020 rises to $3.64 in 2022, allowing the
city to recoup 75% of the cost of service. The recycling rate is planned to match cost in 2023.
The city implemented a storm water utility charge in the middle of 2019. A stormwater 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, are now accounted for in the new fund.
The city has shifted its focus from issuing debt for all street projects in the Pavement
Preservation Program to funding those projects on a pay-as-you-go basis due to the relatively
routine nature of road improvements in the city. The debt level and debt levy capacities are
reserved for major projects that are truly unique such as the Bertram Chain of Lakes Regional
Park, Public Works Facility construction, and The Pointes at Cedar development area.
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CAPITAL EXPENDITURES & CAPITAL IMPROVEMENT PLAN
INTRODUCTION
Capital expenditures (also called capital outlays) are the purchases of capital assets, which are used in
operations and have initial useful lives extending beyond a single reporting period. These assets must
also meet capitalization thresholds (see Appendix), which vary by asset classification and typically costs
more than $10,000.
Capital expenditures can be classified as either recurring or non-recurring. Large projects adding to or
replacing infrastructure are usually non-recurring in nature. The Public Works Facility design work,
School Boulevard safety improvements, design and grading work at the Pointes at Cedar development
area, and a water/sewer SCADA system update account for the bulk of the 2022 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 2022-2026 Capital
Improvements Plan (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 PLAN?
A capital improvement plan is a five-year projection for the evaluation of the city's capital needs.
It serves as a guide for construction, development, and maintenance of the city's infrastructure
assets, as well as other less expensive assets, in the most cost-efficient manner possible. It is the
result of systematic review of each project, as it relates to the city council goals and the
established priority scheme, to maximize the use of all financial resources. The Monticello CIP
has four expenditure categories: capital improvements, vehicles and major equipment, major
repair and maintenance items, and small tools and equipment.
While the plan 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 cost variances.
WHAT ARE THE OBJECTIVES OF A CAPITAL IMPROVEMENT PLAN?
· To forecast public facilities and improvements in a timely and systematic manner while
providing an opportunity for 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.
· 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.
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· 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 PLAN DEVELOPMENT PROCESS?
Assign Project Titles
Make the title descriptive of the nature and scope work.
Group projects in a meaningful way by department. A project title of Boomerang Improvements
will not work if it includes everything from the kitchen sink replacement to the pathway
overlay.
Formulate Project Descriptions
Include the target activities to be completed each year on the project. This 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.
1. Corrects a condition dangerous to public health or safety
2. Satisfies a legal obligation (law, regulation, court order, contract)
3. Alleviates an emergency service disruption or deficiency
4. Prevents irreparable damage to a valuable public facility
Priority II: Essential (SHOULD-DO)-Projects that address clearly demonstrated needs or
objectives.
5. Rehabilitates or replaces an obsolete public facility or attachment thereto
6. Stimulates economic growth and private capital investment
7. Reduces future operating and maintenance costs
8. Leverages available State or Federal funding
Priority III: Important (COULD-DO)-Projects that benefit the community but may be delayed
without detrimental effects to basic services.
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9. Provides a new or expanded level of service
10. Promotes intergovernmental cooperation
11. Reduces energy consumption
12. Enhances cultural or natural resources
Document Project Justifications
The following things 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 because 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 an operating impact.
Note Unfunded Projects
· All projects not funded are placed on an unfunded list.
Present product to the city council for review and final consideration
· Five-year funded capital improvements
· Ranked list of unfunded needs
HOW DOES THE CAPITAL IMPROVEMENT PLAN IMPACT THE OPERATING BUDGET?
All capital improvement projects are required to show the operating budget impact at the time
the projects are submitted for consideration in the Capital Improvement Plan. This includes the
number of full-time equivalent positions that would be needed or could be eliminated and the
cost or savings for salaries/benefits, supplies/services, and equipment. It would not be prudent
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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 more than 70-mile street system. For more durable mill and overlay, the
city budgets $300,000 every other year for chip sealing and $70,000 each year for crack sealing.
These operating and capital expenditures work together to prevent more expensive street
reconstruction projects.
Finally, the city annually budgets for replacement of water and sewer mains through each
respective enterprise fund. For public utilities, customer satisfaction is difficult to quantify in
dollars. However, a generally satisfied customer may be less likely to complain about the rate
increases needed to support those services.
In the table below, items with a positive impact on operating costs are additional equipment,
incurring additional lease payments and/or R&M. Items with a negative impact on operating
costs are replacement equipment with lower R&M in the near term. Items with both positive
and negative impacts on operating costs are noted with (+) and (-) in the Comment column.
R&M expenses for roads include estimates for snow removal, boulevard maintenance, street
sweeping, crack sealing, and striping. Listed amounts are for expenses more than those already
being incurred. With no impact on expenses, some are replaced due to obsolescence or
aesthetics reasons. Some of these amounts may or may not be close to those actually incurred.
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Investment
Department - Operating Fund Amount Starting Year Amount Comment
City Hall - General Fund
City Hall Cooling Unit 30,000$ 2022 (1,000)$ Utilities and R&M
Fire - General Fund
Engine 1 725,000$ 2022 (20,000)$ R&M
Building Inspections - General Fund
Building Inspector Vehicle #1 35,000$ 2022 5,500$ CE lease (+) and R&M (-)
Building Inspector Vehicle #2 35,000$ 2022 5,500$ CE lease (+) and R&M (-)
Public Works - General Fund
Engineering Inspection Vehicle 35,000$ 2022 5,650$ CE lease (+) and R&M (-)
Paver 100,000$ 2022 12,000$ CE lease (+) and R&M (-)
Paver Trailer 30,000$ 2022 3,600$ CE lease (+) and R&M (-)
Dump Truck 350,000$ 2022 41,800$ CE lease (+) and R&M (-)
1.5 ton truck 80,000$ 2022 9,600$ CE lease (+) and R&M (-)
Mini Loader 100,000$ 2022 12,000$ CE lease (+) and R&M (-)
School Boulevard Improvements 550,000$ 2023 3,350$ Utilities and R&M
Fenning Avenue Pathway Lighting 175,000$ 2023 2,625$ Utilities and R&M
2022 Street & Sidewalk Project 1,700,000$ 2023 (8,500)$ R&M
Chelsea/90th Extension Oversizing 200,000$ 2023 2,000$ R&M
Recreation & Culture - General Fund
Kawasaki Mule 4010 15,000$ 2022 2,450$ CE lease (+) and R&M (-)
Toro 7200D Mower 21,000$ 2022 3,390$ CE lease (+) and R&M (-)
Toro 7200D Mower 21,000$ 2022 3,390$ CE lease (+) and R&M (-)
Toro 4100D Mower 87,000$ 2022 14,130$ CE lease (+) and R&M (-)
2021 Isuzu 63,000$ 2022 7,570$ CE lease (+) and R&M (-)
Library Roof 55,000$ 2023 550$ R&M
School Boulevard Pathway 375,000$ 2023 3,750$ R&M
Recreation - Community Center
East/West Door Handicap Doors 20,000$ 2022 400$ Utilities and R&M
Card Access Readers 16,000$ 2022 (150)$ Utilities (+) and Lost keys (-)
Carpet and Terrazo Repair 30,000$ 2022 300$ R&M
Public Works - Stormwater Fund
The Pointes at Cedar Pond 2,700,000$ N/A -$ Design & grading stage only
Otter Creek - Pond A 480,000$ 2023 9,600$ R&M
Otter Creek - Pond Outlet 120,000$ 2023 2,400$ R&M
Street Sweeper 187,000$ 2022 (500)$ R&M
Public Works - Water Fund
SCADA 400,000$ 2022 7,000$ R&M, software support
Backup Generator 100,000$ 2022 1,000$ R&M
Public Works - Sewer Fund
SCADA 800,000$ 2022 8,000$ R&M, software support
Half-Ton Pickup 42,000$ 2022 (840)$ R&M
Facilities Maintenance Fund
Facilities Maintenance Vehicle 40,000$ 2022 400$ R&M
Information Technology (IT) Fund
Cameras - Parks, Liquor Store, MCC 111,400$ 2022 1,100$ R&M
Devices - PCs, Laptops, Printers 43,000$ 2022 (430)$ R&M
Impact on
Operating Expense
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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.
HOW IS THE CAPITAL IMPROVEMENT PLAN FINANCED?
In analyzing the financial viability of the capital improvements in the 2022-2026 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,
internal service funds have been established for Facilities Maintenance and IT Services,
which will also include equipment purchases related to each respective fund.
Enterprise fund revenues, derived from user charges, are used to finance capital
improvements and equipment necessary for delivering a specific service. Additionally,
accumulated revenues in enterprise funds can be transferred to other funds to provide
financing for capital asset acquisitions.
Federal and state grants provide funding for various capital improvement projects. Other
sources include local grants, donations, reserves, and other governmental units that
share boundaries.
Debt issuance is used to finance large, non-recurring capital improvements. General
obligation improvement bonds and general obligation revenue bonds are used to finance
improvements to the city’s infrastructure. Many of the items identifying the Capital
Project Fund as funding source will need some level of debt issuance.
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The below graphs provide a breakdown of expenditures and funding sources within the CIP:
The large increase of expenditures and funding in 2023 are related the construction of a new
Public Works building. 2024’s capital activity portrays improvements, including a deep sewer
trunk line, on Fallon Avenue from Chelsea Road to School Boulevard. The 2025 grant funding is
related to a funding request in process with the State of Minnesota for construction of a Water
Treatment Plant.
$-
$5
$10
$15
$20
$25
$30
$35
$40
2022 2023 2024 2025 2026MillionsCIP -Expenditures for FY 2022 -2026
Buildings Infrastructure - Streets Infrastructure - Utilities Improvements - Parks Equipment Vehicles
$-
$5
$10
$15
$20
$25
$30
$35
$40
2022 2023 2024 2025 2026MillionsCIP -Funding Sources for FY 2022 -2026
Capital Projects Fund Central Equipment Fund Enterprise Funds Other Funds External Grant Funding
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Capital Improvement Plan
City of Monticello, Minnesota
FUNDING SOURCE SUMMARY
2022 thru 2026
TotalSource2022 2023 2024 2025 2026
Capital Equipment Fund 4,126,592972,000 836,881 911,537 426,087 980,087
Capital Project Fund 29,796,5006,490,000 7,150,000 11,522,500 725,000 3,909,000
Community Center Fund 546,00066,000 130,000 115,000 160,000 75,000
Debt Proceeds 36,765,00020,500,000 5,000,000 11,265,000
DMV Fund 30,00030,000
Facility Maintenance Fund 40,00040,000
Fibernet Fund 983,500183,500 200,000 200,000 200,000 200,000
General Fund 1,469,500167,000 499,000 162,000 480,500 161,000
IT Services Fund 268,400154,400 34,500 26,500 26,500 26,500
Municipal Liquor Fund 2,135,00010,000 75,000 50,000 2,000,000
Parks & Pathways Fund 3,053,000375,000 560,000 268,000 940,000 910,000
Sewer Fund 5,023,0151,217,000 1,222,790 1,541,196 485,000 557,029
State of MN Grant Funding 22,000,00022,000,000
Stormwater Access Fund 3,529,000650,000 610,000 1,560,000 50,000 659,000
Stormwater Fund 2,527,000527,000 1,380,000 140,000 340,000 140,000
Street Lighting Fund 725,000425,000 75,000 75,000 75,000 75,000
Water Fund 4,290,000650,000 610,000 610,000 610,000 1,810,000
11,926,900 33,883,171 22,131,733 37,833,087 11,532,616 117,307,507GRAND 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
2022 2026thru
Total2022 2023 2024 2025 2026Department Project # Priority
Community Center
546,00066,000 130,000 115,000 160,000 75,000Community Center Fund
45,00045,000IT Services Fund
591,000111,000 130,000 115,000 160,000 75,000Community Center Total
MCC-13-001 40,00040,000Movable Walls 3
MCC-13-003 20,00020,000City Council Dais Top 3
MCC-13-004 100,000100,000Concession Counter Improvements 3
MCC-17-003 20,00020,000East/West Handicap Doors 1
MCC-18-003 16,00016,000Card Access Reader 3
MNC-13-006 90,00030,000 20,000 40,000Carpet and Terrazo Replace/Repair 2
MNC-13-010 20,00020,000Vanity and Partition Replacement 3
MNC-19-001 35,00035,000Climbing Wall Resurfacing 2
MNC-19-002 5,0005,000Childcare Countertop Replacement 3
STE-13-013 145,00085,000 60,000Recreation Equipment 2
STE-15-001 45,00045,000Survelliance Camera Upgrade 3
VEQ-13-045 20,00020,000Dishwasher 3
VEQ-18-001 35,00035,000Recreation Software 3
591,000111,000 130,000 115,000 160,000 75,000Community Center Total
Community Development
70,00070,000Capital Equipment Fund
70,00070,000Community Development Total
VEQ-22-037 35,00035,000Building Inspector Vehicle n/a
VEW-22-038 35,00035,000Building Inspector Vehicle n/a
70,00070,000Community Development Total
DMV - Deputy Registrar
30,00030,000DMV Fund
30,00030,000DMV - Deputy Registrar Total
VEQ-13-047 30,00030,000DMV Vehicle 2
30,00030,000DMV - Deputy Registrar Total
Facilities Maintenance
Produced Using the Plan-It Capital Planning Software
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Total2022 2023 2024 2025 2026Department Project # Priority
115,000115,000Capital Project Fund
40,00040,000Facility Maintenance Fund
40,00040,000General Fund
195,000155,000 40,000Facilities Maintenance Total
FAM-22-040 55,00055,000Roof-Library n/a
FAM-22-041 40,00040,000Carpet - Library n/a
FAM-22-042 30,00030,000Cooling Unit - City Hall n/a
FAM-22-043 30,00030,000HVAC - PW n/a
VEQ-22-039 40,00040,000Facility Maintenance Vechicle n/a
195,000155,000 40,000Facilities Maintenance Total
Fibernet
983,500183,500 200,000 200,000 200,000 200,000Fibernet Fund
983,500183,500 200,000 200,000 200,000 200,000Fibernet Total
FNM-22-045 983,500183,500 200,000 200,000 200,000 200,000Capital Expansion n/a
983,500183,500 200,000 200,000 200,000 200,000Fibernet Total
Fire & Rescue
500,000150,000 350,000Capital Equipment Fund
725,000725,000Capital Project Fund
144,50022,000 19,000 32,000 40,500 31,000General Fund
1,369,500747,000 19,000 32,000 190,500 381,000Fire & Rescue Total
MNC-22-036 77,00015,000 15,000 15,500 15,500 16,000Radios n/a
STE-16-002 67,5007,000 4,000 16,500 25,000 15,000Turnout Gear 1
VEQ-18-005 725,000725,000Engine 1 - Replacement 1
VEQ-18-006 150,000150,000Utility 1 - Replacement 1
VEQ-21-002 350,000350,000Tender 11 Replacement 1
1,369,500747,000 19,000 32,000 190,500 381,000Fire & Rescue Total
IT Services
157,00043,000 34,500 26,500 26,500 26,500IT Services Fund
157,00043,000 34,500 26,500 26,500 26,500IT Services Total
MNC-22-046 8,0008,000Plotter at Fire Station n/a
STE-13-001 77,50015,500 15,500 15,500 15,500 15,500Personal Computers 2
STE-13-005 15,0003,000 3,000 3,000 3,000 3,000Laptops 2
STE-20-002 56,50024,500 8,000 8,000 8,000 8,000Copiers 3
157,00043,000 34,500 26,500 26,500 26,500IT Services Total
Municipal Liquor
Produced Using the Plan-It Capital Planning Software
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Total2022 2023 2024 2025 2026Department Project # Priority
15,00015,000IT Services Fund
2,135,00010,000 75,000 50,000 2,000,000Municipal Liquor Fund
2,150,00025,000 75,000 50,000 2,000,000Municipal Liquor Total
LIQ-13-002 75,00075,000Parking Lot Improvements 1
LIQ-13-003 2,000,0002,000,000Liquor Store - #2 3
LIQ-13-046 10,00010,000Liquor Store Coolers 1
LIQ-18-001 50,00050,000Roof1
LIQ-22-044 15,00015,000Liquor Store Surveillance Cameras n/a
2,150,00025,000 75,000 50,000 2,000,000Municipal Liquor Total
Public Works
2,816,063695,000 639,720 846,594 114,646 520,103Capital Equipment Fund
3,000,000500,000 2,500,000Capital Project Fund
18,000,00018,000,000Debt Proceeds
23,816,0631,195,000 18,639,720 3,346,594 114,646 520,103Public Works Total
PWK-13-001 21,000,000500,000 18,000,000 2,500,000Public Works Facility 3
VEQ-21-997 2,121,063639,720 846,594 114,646 520,103Fleet Replacement - PW 3
VEQ-22-001 35,00035,000Engineering Inspection Vehicle n/a
VEQ-22-002 100,000100,000Paver n/a
VEQ-22-003 30,00030,000Paver Trailer n/a
VEQ-22-004 300,000300,000Dump Truck n/a
VEQ-22-005 80,00080,0001.5 Ton Truck n/a
VEQ-22-006 150,000150,000Mini Loader n/a
23,816,0631,195,000 18,639,720 3,346,594 114,646 520,103Public Works Total
Recreation & Culture
MNC - 22-022 6,9006,900Park Cameras - 4th St n/a
MNC-14-007 290,00050,000 60,000 60,000 60,000 60,000Pathway Maintenance (Annual) 2
MNC-22-016 12,00012,000Bike Route Map n/a
MNC-22-023 8,7008,700Park Cameras - BCOL n/a
MNC-22-024 3,7003,700Park Cameras - East Bridge n/a
MNC-22-025 4,7004,700Park Cameras - Ballpark n/a
MNC-22-026 2,5002,500Park Cameras - Groveland n/a
MNC-22-027 6,2006,200Park Cameras - Ellison n/a
MNC-22-028 4,0004,000Park Cameras - Montiview n/a
MNC-22-029 4,2004,200Park Cameras - Hillcrest n/a
MNC-22-030 4,5004,500Park Cameras - Pioneer n/a
MNC-22-031 6,0006,000Park Cameras - West Bridge n/a
PAR-13-003 16,00016,000Sunset Ponds Shelter 3
PAR-13-012 900,000200,000 700,000BCOL Ball Fields 3
PAR-13-014 60,00060,000CSAH 75 Pathway Lighting 3
PAR-15-004 175,000175,000Fenning Avenue Pathway Connection 3
PAR-17-002 100,000100,000West Bridge Playground Structure 3
PAR-17-004 100,000100,000Pioneer Park Playground Structure 3
Produced Using the Plan-It Capital Planning Software
94
Total2022 2023 2024 2025 2026Department Project # Priority
740,529207,000 197,161 64,943 161,441 109,984Capital Equipment Fund
310,00050,000 70,000 60,000 70,000 60,000General Fund
51,40051,400IT Services Fund
2,678,000560,000 268,000 940,000 910,000Parks & Pathways Fund
175,000175,000Street Lighting Fund
3,954,929483,400 827,161 392,943 1,171,441 1,079,984Recreation & Culture Total
PAR-17-007 25,00025,000Front Street Pier 3
PAR-20-001 35,00035,000Park Master Plan 3
PAR-20-003 200,000200,000Briarwood 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-21-001 20,00020,000BCOL Athletic Field Needs Study 3
PAR-21-004 40,00010,000 10,000 10,000 10,000Wayfinding Signage 3
PAR-21-005 50,00050,000Welcome Sign for Monticello 3
PAR-21-006 70,00070,000Columbarium-Riverside Cemetery 3
PAR-21-007 20,00010,000 10,000Boulevard Trees 3
PAR-22-015 500,000500,000BCOL County/City Maintenance Facility n/a
PAR-22-017 15,00015,000Kawasaki Mule 4010 n/a
PAR-22-018 21,00021,000Toro 7200D Mower n/a
PAR-22-019 21,00021,000Toro 7200D Mower n/a
PAR-22-020 87,00087,000Toro 7200D Mower n/a
PAR-22-021 63,00063,0002021 Isuzu n/a
VEQ-21-998 533,529197,161 64,943 161,441 109,984Fleet Replacement - Parks 3
3,954,929483,400 827,161 392,943 1,171,441 1,079,984Recreation & Culture Total
Stormwater\Drainage
11,181,5002,700,000 3,000,000 3,172,500 2,309,000Capital Project Fund
3,529,000650,000 610,000 1,560,000 50,000 659,000Stormwater Access Fund
2,527,000527,000 1,380,000 140,000 340,000 140,000Stormwater Fund
17,237,5003,877,000 4,990,000 4,872,500 390,000 3,108,000Stormwater\Drainage Total
SWD-13-001 800,000240,000 240,000 40,000 240,000 40,000Stormwater 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 1,059,000450,000 609,000Chelsea/Fallon Avenue Pond Expansion 3
SWD-20-001 480,000480,000Otter Creek - Pond A Construction 3
SWD-20-002 560,000560,000Otter Creek - Pond D Construction 3
SWD-20-003 120,000120,000Otter Creek - Karlsburger Pond Outlet 2
SWD-20-005 40,00040,000Chelsea Road Outlet Control - HB07 2
SWD-22-011 1,000,0001,000,000Otter Creek Industrial Park Expansion n/a
SWD-22-012 187,000187,000Street Sweeper n/a
SWD-22-013 11,181,5002,700,000 3,000,000 3,172,500 2,309,000The Pointes at Cedar Pond n/a
SWD-22-014 500,000100,000 100,000 100,000 100,000 100,000Ditch 33 Upgrades n/a
17,237,5003,877,000 4,990,000 4,872,500 390,000 3,108,000Stormwater\Drainage Total
Produced Using the Plan-It Capital Planning Software
95
Total2022 2023 2024 2025 2026DepartmentProject # Priority
Streets
14,775,0002,450,000 4,150,000 5,850,000 725,000 1,600,000Capital Project Fund
2,500,0002,500,000Debt Proceeds
975,00095,000 370,000 70,000 370,000 70,000General Fund
375,000375,000Parks & Pathways Fund
550,000250,000 75,000 75,000 75,000 75,000Street Lighting Fund
19,175,0003,170,000 7,095,000 5,995,000 1,170,000 1,745,000Streets Total
MNC-13-001 25,00025,000City Street Signs 1
MNC-14-001 600,000300,000 300,000Annual Chip Seal 1
MNC-20-001 350,00070,000 70,000 70,000 70,000 70,000Annual Crack Seal 1
STR-13-010 400,000100,000 75,000 75,000 75,000 75,000Street Light Improvements 2
STR-15-003 750,00050,000 700,000Elm Street Sidewalk - 3rd St Pedestrian Blinker 3
STR-15-004 600,000200,000 100,000 100,000 100,000 100,000Sidewalk Gap Improvement Project (TBD) 2
STR-16-002 300,000300,000Flashing Yellow Arrow Signal 1
STR-17-002 1,750,000100,000 1,500,000 150,000Fallon Ave & Trail - Chelsea to School Bvld 3
STR-19-001 6,250,0001,500,000 3,250,000 1,500,000Pavement Management Program 1
STR-19-004 25,00025,000Broadway Corridor Parklets 3
STR-20-001 925,000925,000School Blvd Pedestrian Improvements 1
STR-20-002 800,000100,000 700,000School Blvd/Cedar Roundabout 3
STR-20-003 500,00050,000 450,000School Blvd/Fallon Roundabout 3
STR-20-005 700,000100,000 600,000Walnut River Street Connection 3
STR-20-007 2,500,0002,500,00090th St Reconstruction - Chelsea to City Limits 2
STR-21-001 350,000350,000Broadway Sidewalk Improvements 3
STR-22-007 650,000650,000Hwy25/Broadway Intersection Improvements n/a
STR-22-008 200,000200,000Chelsea/90th West Extension Oversizing n/a
STR-22-009 1,000,0001,000,000Dalton Way Extension and Industrial Park Grading n/a
STR-22-010 500,000250,000 250,000School Boulevard Extension n/a
19,175,0003,170,000 7,095,000 5,995,000 1,170,000 1,745,000Streets Total
Utility - Sewer
10,265,0005,000,000 5,265,000Debt Proceeds
MNC-17-005 110,000110,0003
UTS-13-001 1,250,000250,000 250,000 250,000 250,000 250,0001
UTS-13-002 750,000750,0003
UTS-13-005 1,365,0001,365,0001
UTS-13-006 1,800,0001,800,0001
UTS-16-001 625,000125,000 125,000 125,000 125,000 125,0002
UTS-17-001 2,100,0002,100,0002
UTS-17-002 5,300,000300,000 5,000,0003
UTS-20-001 100,000100,0001
VEQ-13-004 800,000800,0002
VEQ-21-999 546,01547,790 316,196 182,0293
VEQ-22-034 42,00042,000n/a
VEQ-22-035 500,000500,000
Demo Obsolete WWTP Equipmnet
Annnual Sewer Trunk Improvements
Liftstation - Marvin Road
WWTP Solids Handling Improvements
WWTP Phase 2 Improvements
WWTP Repair & Maintenance Annual Upgrades
WWTP Headworks Improvements
Fallon Avenue Trunk Line Extension
Vactor Dump Station
SCADA System - Sewage
Fleet Replacement - Sewage
1/2 Ton Pickup
West CSAH 39 Utility Extension n/a
15,288,0151,217,000 1,222,790 6,541,196 5,750,000 557,029Utility - Sewer Total
Produced Using the Plan-It Capital Planning Software
96
Total2022 2023 2024 2025 2026Department Project # Priority
5,023,0151,217,000 1,222,790 1,541,196 485,000 557,029Sewer Fund
15,288,0151,217,000 1,222,790 6,541,196 5,750,000 557,029Utility - Sewer Total
Utility - Water
6,000,0006,000,000Debt Proceeds
22,000,00022,000,000State of MN Grant Funding
4,290,000650,000 610,000 610,000 610,000 1,810,000Water Fund
32,290,000650,000 610,000 610,000 28,610,000 1,810,000Utility - Water Total
UTW-13-001 750,000150,000 150,000 150,000 150,000 150,000Annual Water System Improvements 1
UTW-13-002 28,000,00028,000,000Water Treatment Facility 1
UTW-13-003 1,200,0001,200,000Well #6 1
UTW-22-032 100,000100,000Backup Generator n/a
UTW-22-033 1,840,000460,000 460,000 460,000 460,000Cast Iron Watermain Replacement n/a
VEQ-13-003 400,000400,000SCADA System - Water 2
32,290,000650,000 610,000 610,000 28,610,000 1,810,000Utility - Water Total
117,307,50711,926,900 33,883,171 22,131,733 37,833,087 11,532,616Grand Total
Produced Using the Plan-It Capital Planning Software
97
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, and transfers from enterprise funds collecting
development fees. The debt effect on services delivered through governmental funds with
current plant and equipment is somewhat diminished because the city is not constrained by
state-imposed levy limits for property taxes. When levy limits have been in place, statutes have
allowed for special levies for debt service. While there are limits to what taxpayers can bear,
Monticello has one of the lowest tax capacity rates in Wright County because of its large
commercial tax base—including the 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 71%) by property taxes and the Monticello Community Center (MCC) Fund
is primarily supported by charges for services and supplemented by a property tax levy. High
debt levels lower the city’s ability to issue new debt for capital assets, which may improve
efficiency or meet a growing need.
Enterprise Funds
The Sewer Fund is the only enterprise fund with debt, the 2013B 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. According to a survey by
engineering firm, AE2S, Monticello has some of the lowest water and sewer 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 71% of the
General Fund revenue comprised of property taxes, the Central Equipment Fund debt and the
related lease payments have a direct effect on the resources available for other uses.
In summary, debt is a valid way to match customers with the cost of providing a particular
service. Current service customers pay for current service delivery with annual debt service
payments supported by user fees and taxes. Future service customers make future debt service
payments through future taxes and user fees.
98
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
grade
Lower
medium
grade
Market value (payable 2021)*2,100,005,500$
Debt limit (3% of market value)63,000,165$
Total net debt applicable to limit (13,240,000)$
Legal debt margin 49,760,165$
*Payable 2022 not yet available.
Legal Debt Margin Calculation for Fiscal Year 2022
99
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:
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
G.O. Debt Service Levies
2014A 2015B 2016A 2017A 2018A 2019A 2020A
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
G.O. Debt Service Payments
2011A 2013B 2014A 2015B 2016A 2017A 2018A 2019A 2020A
$-
$5
$10
$15
$20
$25
2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034MillionsG.O. Debt Outstanding as of 12/31
2011A 2013B 2014A 2015B 2016A 2017A 2018A 2019A 2020A
100
STAFFING SUMMARY
Staffing, as measured by full-time equivalents, decreased in 2020 due to the COVID-19 pandemic.
Since 2020, staffing has been increasing slightly, mostly in response to an increase in activity and
hours of operation. Many employees perform across multiple activities/divisions and funds. The
budget reflects updates to the allocation of time for Public Works employees between the General
Fund (streets and ice & snow) and the Stormwater Fund as well as the new Parks, Arts &
Recreation Department formed in 2021.
Adopted
Actual Actual A ctual Budget
2019 2020 2021 2022
General Fund
City Administration 3.60 3.60 3.60 3.60
Finance 3.85 3.35 3.80 3.85
City Clerk 1.00 1.00 1.00 1.25
Human Resources 1.00 1.00 1.00 1.00
Planning & Zoning 1.30 1.30 1.10 1.40
Fire & Rescue 1.00 1.00 1.00 1.00
Building Inspections 3.00 3.00 3.00 4.20
Public Works Administration 1.80 1.80 1.90 1.10
Engineering & Inspections 1.00 0.90 1.35 1.55
Streets & Alleys 4.80 3.55 4.40 4.20
Shop & Garage 0.80 0.80 0.80 1.30
Ice & Snow 1.65 1.60 2.10 2.30
Park Operations 8.35 8.60 8.85 9.70
Shade Tree 0.60 0.60 0.75 0.90
Total General Fund 33.75 32.10 34.65 37.35
Special Revenue Funds
Economic Development 1.20 1.20 1.20 1.50
Monticello Community Center 23.45 13.95 13.40 13.35
Total Special Revenue Funds 24.65 15.15 14.60 14.85
Enterprise Funds
Water 3.65 3.15 3.80 3.60
Sewer 3.65 3.15 3.75 3.75
Stormwater - 1.00 1.10 1.40
Liquor 12.00 10.80 10.20 11.45
Deputy Registrar 9.00 7.50 7.50 7.45
Total Enterprise Funds 28.30 25.60 26.35 27.65
Internal Service Funds
Facilities Maintenance - - 0.50 1.10
IT Services - - 0.40 1.00
Total Internal Service Funds - - 0.90 2.10
Total All Funds 86.70 72.85 76.50 81.95
NUMBER OF FULL-TIME EQUIVALENTS
101
2022 ADOPTED BUDGETGeneral 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.
SUMMARY
GENERAL FUND 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 6,667,831$ 6,774,776$ 7,169,000$ 7,208,949$ 7,475,000$ 4.3%
Franchise & Other Taxes 232,816 216,864 256,500 217,833 258,000 0.6%
Licenses & Permits 603,925 521,369 420,300 804,889 471,100 12.1%
Intergovernmental Revenues 431,004 737,650 404,000 625,382 463,000 14.6%
Charges for Services 746,706 885,951 965,300 1,214,288 1,118,600 15.9%
Fines & Forfeits 40,054 31,852 41,600 49,566 51,600 24.0%
Special Assessments 802 166 150 468 100 -33.3%
Miscellaneous 509,858 621,431 618,150 712,277 692,600 12.0%
Contributed Capital 29,340 - - - - ---
Operating Transfers In 25,000 - - - - ---
TOTAL REVENUES 9,287,336$ 9,790,059$ 9,875,000$ 10,833,653$ 10,530,000$ 6.6%
GENERAL FUND 2019 2020 2021 2021 2022 %
EXPENDITURES BY DEPT ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
GENERAL GOVERNMENT
Mayor and Council 57,409$ 52,589$ 59,178$ 57,171$ 59,262$ 0.1%
City Administration 443,963 789,820 956,408 939,114 1,075,361 12.4%
City Clerk 121,197 180,824 128,960 125,285 195,337 51.5%
Finance 502,842 491,378 502,156 500,722 537,515 7.0%
City Assessing 64,554 70,115 75,000 77,600 78,000 4.0%
Legal 41,837 29,340 35,000 25,883 27,500 -21.4%
Human Resources 142,812 142,232 139,054 131,467 148,810 7.0%
Planning & Zoning 315,091 339,005 268,867 685,171 308,957 14.9%
City Hall 66,422 60,501 86,910 68,095 70,687 -18.7%
General City Buildings 21,225 14,857 23,183 16,315 - -100.0%
TOTAL GENERAL GOVERNMENT 1,777,352$ 2,170,661$ 2,274,716$ 2,626,822$ 2,501,429$ 10.0%
PUBLIC SAFETY
Law Enforcement 1,455,727$ 1,524,150$ 1,595,638$ 1,602,877$ 1,650,816$ 3.5%
Fire & Rescue 477,941 414,399 502,257 459,591 553,127 10.1%
Fire Relief 123,640 131,638 135,000 134,691 140,000 3.7%
Building Inspections 324,072 354,251 466,357 599,567 567,751 21.7%
Emergency Management 8,253 257,565 6,000 13,725 25,225 320.4%
Animal Control 46,709 49,522 56,842 50,586 59,971 5.5%
National Guard 13,423 12,429 14,000 13,143 14,000 0.0%
TOTAL PUBLIC SAFETY 2,449,765$ 2,743,954$ 2,776,094$ 2,874,179$ 3,010,890$ 8.5%
102
The previous table summarizes General Fund expenditures by activities/divisions and
departments. The table below summarizes expenditures by classifications.
GENERAL FUND 2019 2020 2021 2021 2022 %
EXPENDITURES BY DEPT ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
PUBLIC WORKS
Public Works Administration 228,625$ 221,881$ 243,340$ 244,353$ 157,673$ -35.2%
Engineering 111,710 80,432 112,405 93,846 - -100.0%
Engineering & Inspections 90,047 102,110 169,632 107,586 359,683 112.0%
Streets & Alleys 920,384 777,633 1,294,694 919,551 1,124,296 -13.2%
Ice & Snow 454,607 326,120 375,600 294,313 407,126 8.4%
Shop & Garage 178,063 199,310 256,932 269,192 315,246 22.7%
Stormwater 27,650 - - - - ---
Street Lighting 210,948 191,829 237,000 195,055 237,000 0.0%
Refuse Collection 610,944 681,948 722,936 754,132 802,878 11.1%
TOTAL PUBLIC WORKS 2,832,978$ 2,581,263$ 3,412,539$ 2,878,028$ 3,403,902$ -0.3%
RECREATION AND CULTURE
Senior Center 102,169 103,662 106,363 105,689 106,363 0.0%
Park Operations 925,482 1,040,665 1,061,609 1,098,442 1,230,204 15.9%
Park Ballfields 19,836 23,685 27,400 28,072 27,400 0.0%
Public Arts 46,954 36,092 57,500 93,246 72,241 25.6%
Shade Tree 61,396 79,024 105,065 87,526 118,175 12.5%
Library 53,592 48,068 53,714 44,506 53,396 -0.6%
TOTAL RECREATION AND CULTURE 1,209,429$ 1,331,196$ 1,411,651$ 1,457,480$ 1,607,779$ 13.9%
Operating Transfers 1,450,040$ 1,000,000$ -$ 1,002,368$ 6,000$ ---
TOTAL EXPENDITURES 9,719,564$ 9,827,074$ 9,875,000$ 10,838,877$ 10,530,000$ 6.6%
GENERAL FUND 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 6,667,831$ 6,774,776$ 7,169,000$ 7,208,949$ 7,475,000$ 4.3%
Franchise & Other Taxes 232,816 216,864 256,500 217,833 258,000 0.6%
Licenses & Permits 603,925 521,369 420,300 804,889 471,100 12.1%
Intergovernmental Revenues 431,004 737,650 404,000 625,382 463,000 14.6%
Charges for Services 746,706 885,951 965,300 1,214,288 1,118,600 15.9%
Fines & Forfeits 40,054 31,852 41,600 49,566 51,600 24.0%
Special Assessments 802 166 150 468 100 -33.3%
Miscellaneous 509,858 621,431 618,150 712,277 692,600 12.0%
Contributed Capital 29,340 - - - - ---
Operating Transfers In 25,000 - - - - ---
TOTAL REVENUES 9,287,336$ 9,790,059$ 9,875,000$ 10,833,653$ 10,530,000$ 6.6%
EXPENDITURES
Personnel Services 3,324,061$ 3,306,432$ 3,651,591$ 3,433,833$ 3,897,421$ 6.7%
Supplies 671,712 620,101 817,700 748,686 874,870 7.0%
Other Services & Charges 3,974,851 4,569,741 4,969,109 5,101,622 5,173,309 4.1%
Capital Outlay 298,900 330,800 436,600 552,369 578,400 32.5%
Operating Transfers Out 1,450,040 1,000,000 - 1,002,368 6,000 ---
TOTAL EXPENDITURES 9,719,564$ 9,827,074$ 9,875,000$ 10,838,877$ 10,530,000$ 6.6%
FUND BALANCE - JANUARY 1 7,109,478$ 6,677,250$ 6,640,235$ 6,640,235$ 6,635,011$
Excess (Deficiency) of
Revenues over Expenditures (432,228) (37,015) - (5,224) -
FUND BALANCE - DECEMBER 31 6,677,250$ 6,640,235$ 6,640,235$ 6,635,011$ 6,635,011$
103
BUDGET COMMENTARY:
Revenues
For 2022, budgeted revenues are estimated to increase by 6.6%. The General Fund portion of
the tax levy is budgeted to increase by 4.3%, which is more than the total (city & HRA) levy
increase of 2.7%. Property taxes account for 71% of General Fund revenues. Increases in
Licenses & Permits, Intergovernmental Revenues, and Fines & Forfeits are due to budgeting
more closely with trends from the previous years. The increase in charges for services reflects
higher residential garbage and recycling charges. The city now covers its cost of garbage service
completely and recovers 75% of recycling charges from those who receive the service. The goal
is to increase recycling charges to 100% of cost in 2023. Miscellaneous revenues increase due to
electricity credits partially offset by solar farm investment cost because the city invested in
more kilowatt-hour (kWh) production in 2021.
Expenditures
Expenditures are budgeted to increase 6.6%. Expenditures in the City Clerk department
increased due to the mid-term elections in 2022. The legal department budget decreased due
to lower general legal activity in recent years. The City Hall budget decreased due to more
efficient energy usage. The General City Buildings (formerly Prairie Center Building) department
was eliminated in 2021 because the DMV relocated, and the building costs are now accounted
for in the DMV enterprise fund.
The Building Inspections department budget increased in 2022 due to the purchase of two
vehicles for the department (one new; one a replacement). Emergency Management
expenditures are expected to increase as the City is planning to fully utilize a grant from the
State of Minnesota.
Public Works Administration is budgeted to decrease with an update to the allocation of the
department’s staff time. The Engineering and Engineering & Inspections departments were
combined in 2022. The Streets & Alley budget decreased while the Shope & Garage increased
to reflect the activity more accurately within each area.
Park Operations increased with the need to increase wages to attract seasonal workers. Public
Arts added a second Arts consultant due to the aggressive growth and popularity of the
program.
The 2022 personnel services budget includes a full step increase and a 3.0% market rate wage
increase. Supplies are projected to increase due to inflation. All the capital outlay amount
reflects Capital Equipment Fund purchases, which are charged back through lease payments.
The 2019 and 2020 operating transfers were to the Capital Project Fund for future year capital
expenditures, and the 2021 operating transfer was to the Central Equipment Fund for future
acquisitions.
104
MAYOR AND CITY COUNCIL (101-41110)
DEPARTMENT: General Government SUPERVISOR: City Clerk
ACTIVITY SCOPE:
The mayor and council provide elected representation to the community with control over
policy, goals, budget, administration, and operations. Members participate in various
committees and direct staff through the city administrator.
OBJECTIVES:
1. Adopt policies and ordinances consistent with the council’s positions on growth,
zoning, and financial strategies.
2. Examine city facility needs to meet future city operations.
3. Provide opportunities for public input in decision making.
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:
BUDGET COMMENTARY:
The council’s budget remains consistent with previous years. The mayor earns $700 per month
and each councilmember earns $600 per month. Other services and charges are mainly
comprised of rental charges for the meeting room at the Monticello Community Center.
Measurement 2019 2020 2021 2022
Council meetings 23 22 23 23
Special meetings/workshops 14 13 23 20
GENERAL FUND 2019 2020 2021 2021 2022 %
MAYOR & COUNCIL Actual Actual Budget Projected Budget Change
Personnel Services 41,046$ 42,223$ 41,428$ 45,952$ 43,023$ 3.9%
Supplies - - - - - ---
Other Services & Charges 16,363 10,366 17,750 11,219 16,239 -8.5%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 57,409$ 52,589$ 59,178$ 57,171$ 59,262$ 0.1%
105
CITY ADMINISTRATION (101-41310)
DEPARTMENT: General Government SUPERVISOR: City Administrator
ACTIVITY SCOPE:
City administration provides the overall direction of the city, as determined by the 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 2019 2020 2021 2022
Council meetings agendas 38 35 46 43
Ordinances processed 27 22 20 16
Council minutes approved 38 35 46 43
Newsletters published 2 2 2 2
Utility inserts published 8 4 8 3
Park inserts published 1 1 3 2
All other inserts published 12 11 12 11
Service desk data entry*641 775 351 350
*Entries reduced with the implementation of an online resident reporting system
106
BUDGET:
BUDGET COMMENTARY:
The city administration activity is limited to expenditures for daily operations in providing
services and does not include upkeep of the city hall facility. The 2022 personnel services
budget includes a full step increase and a 3.0% market rate wage increase. Other services and
charges increase due to the increased capacity 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.
GENERAL FUND 2019 2020 2021 2021 2022 %
ADMINIS TRATION Actual Actual Budget Projected Budget Change
Personnel Services 321,302$ 376,883$ 403,733$ 377,760$ 386,660$ -4.2%
Supplies 10,458 8,830 14,500 9,445 13,000 -10.3%
Other Services & Charges 112,203 404,107 538,175 551,909 675,701 25.6%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 443,963$ 789,820$ 956,408$ 939,114$ 1,075,361$ 12.4%
107
CITY CLERK (101-41410)
DEPARTMENT: General Government SUPERVISOR: City Clerk
ACTIVITY SCOPE:
The city clerk activity is responsible for administering elections, maintaining official records,
updating the city code, improving records management and data practices, and serving as the
data practices compliance officer and responsible authority.
OBJECTIVES:
1. 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:
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 2022 personnel
services budget includes a full step increase and a 3.0% market rate wage increase.
Measurement 2019 2020 2021 2022
Voters, number of 0 7,110 0 6,600
Register voters, number of 7,237 7,895 8,101 8,250
Polling places 1 2 2 4
Election judges 0 35 0 40
Ordinances amendments 27 22 20 16
Council resolutions 95 99 99 115
GENERAL FUND 2019 2020 2021 2021 2022 %
CITY CLE RK Actual Actual Budget Projected Budget Change
Personnel Services 105,809$ 151,816$ 113,873$ 110,706$ 153,703$ 35.0%
Supplies 701 3,797 1,000 308 5,750 475.0%
Other Services & Charges 14,687 25,211 14,087 14,271 35,884 154.7%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 121,197$ 180,824$ 128,960$ 125,285$ 195,337$ 51.5%
108
FINANCE (101-41520)
DEPARTMENT: General Government SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The Finance Department conducts the financial affairs of the city of Monticello in accordance
with the Government Accounting Standards Board (GASB) and Generally Accepted Accounting
Principles (GAAP). This includes protection of the assets of the city, the initiation of financial
plans, investment and debt management, review and implementation of internal controls, and
accounting for every financial transaction of the city including accounts payable, accounts
receivable, payroll, and accounting control. The preparation of the annual audited financial
report and annual budget document are also facilitated through finance. An audit of city
finances must be completed on an annual basis for the city to remain in compliance with
federal and state accounting practices.
OBJECTIVES:
1. 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.
5. Complete the financial audit in a timely fashion.
6. Continue to reduce the number of audit findings and adjustments.
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).
7. Comply with changing reporting requirements and auditing standards.
109
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The Finance budget includes funds to handle the financial transactions of the city, in an efficient
manner, while maintaining the highest level of internal controls and segregation of duties. The
2022 personnel services budget includes a full step increase and a 3.0% market rate wage
increase. Contribution to the IT Services fund create an increased budget in the department.
The budget for auditing consists entirely of the expenses associated with the required audit
process. The city issued an RFP for audit services from 2021‐2025 and decreased the cost of the
annual audit in doing so. The finance department has prepared the Annual Comprehensive
Financial Report (ACFR) internally since 2015.
Measurement 2019 2020 2021 2022
Outcome/Effectiveness:
GFOA Budget Awards 11 12 13 14
GFOA Certificates of
Achievement 11 12 13* 14
GFOA Popular Annual
Financial Report Awards 5 6* 7* 8
Bond Rating A1 A1 A1 A1
Audit submittal date 5/22 5/18 5/14 5/16
Audit findings 1 0 0 0
Opinion Unmodified Unmodified Unmodified Unmodified
Efficiency:
AP & ACHs per FTE (1.5) 1,944 1,835 2,027 2,000
ACHs as % of total AP activity 44% 45% 45% 47%
Work Load:
AP checks, number of 1,622 1,526 1,685 1,600
AP ACHs, number of 1,294 1,227 1,355 1,400
Invoices processed 5,186 4,788 5,376 5,500
1099's 65 87 77 75
Paychecks issued 4,602 3,706 3,830 3,900
W‐2s 286 287 255 275
Utility bills generated 52,049 52,918 53,647 54,000
Non‐utility charges billed 319 294 243 250
Cash receipts entered 36,203 37,772 37,707 38,000
Journal entries 2,479 2,355 2,460* 2,400
*Not yet available. Value is an estimate.
GENERAL FUND 2019 2020 2021 2021 2022 %
FINANCE Actual Actual Budget Projected Budget Change
Personnel Services 388,984$ 390,695$ 387,010$ 387,444$ 415,481$ 7.4%
Supplies 1,567 1,431 2,500 859 2,500 0.0%
Other Services & Charges 112,291 99,252 112,646 112,419 119,534 6.1%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 502,842$ 491,378$ 502,156$ 500,722$ 537,515$ 7.0%
110
ASSESSING (101-41550)
DEPARTMENT: General Government SUPERVISOR: Finance Director
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:
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 $14.00 per
parcel for assessment services and $50 for each new permit with an estimated construction
value under $499,999 and $150 for values over $500,000 in 2022. Those rates have climbed
slightly each year.
Measurement 2019 2020 2021 2022
New residential properties 58 59 68 100
New commercial properties 5 6 5 5
Tax exempt parcels 347 349 355 360
Taxable parcels assessed 4,689 4,714 4,732 4,800
GENERAL FUND 2019 2020 2021 2021 2022 %
ASSESSING Act ual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 64,554 70,115 75,000 77,600 78,000 4.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 64,554$ 70,115$ 75,000$ 77,600$ 78,000$ 4.0%
111
LEGAL (101-41610)
DEPARTMENT: General Government SUPERVISOR: City Administrator
ACTIVITY SCOPE:
Private legal firms provide all the city’s legal services. Activities include issuance of legal
opinions; preparation 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. Potentially rising costs associated with the need for existing and new legal services.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The city continues to realize savings from not having full-time counsel. Legal services provided
to FiberNet are charged to the Fiber Optics Fund while those performed related to planning and
development projects are passed through to the applicant.
Measurement 2019 2020 2021 2022
Billed hours:
Administration 299.3 252.8 237.5 250.0
Code enforcement 11.8 6.4 19.6 20.0
Fiber optics 0.0 0.0 2.0 5.0
City Construction Projects 197.3 90.4 174.2 100.0
All other 83.1 70.9 78.5 75.0
Total 591.5 420.5 511.8 450.0
GENERAL FUND 2019 2020 2021 2021 2022 %
LEGAL Ac tual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 41,837 29,340 35,000 25,883 27,500 -21.4%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 41,837$ 29,340$ 35,000$ 25,883$ 27,500$ -21.4%
112
HUMAN RESOURCES (101-41800)
DEPARTMENT: General Government SUPERVISOR: City Administrator
ACTIVITY SCOPE:
Human Resources activities support the primary mission of the city through the effective
recruitment, selection, development, training, and assessment of appropriate human resource
needs. Employee benefits and compensation administration, implementation of and
compliance with Federal and State employment laws, labor negotiations, processing of
employee grievances, and development of personnel policies are 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:
BUDGET:
Measurement 2019 2020 2021 2022
53 55 56 58
153 116 116 123
2 12 9 3
87 51 85 85
81 80 93 93
34 33 34 34
546 408 491 491
Full-time positions
Part-time positions
Full-time positions f illed
Other positions f illed
Terminations processed
Job Postings
Application count - all city
Avg. number of employees 202 171 172 181
GENERAL FUND 2019 2020 2021 2021 2022 %
HUMAN RESOURCES Actual Actual Budget Projected Budget Change
Personnel Services 107,839$ 106,981$ 113,323$ 110,914$ 117,865$ 4.0%
Supplies 660 104 650 1,223 700 7.7%
Other Services & Charges 34,313 35,147 25,081 19,330 30,245 20.6%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 142,812$ 142,232$ 139,054$ 131,467$ 148,810$ 7.0%
113
BUDGET COMMENTARY:
The 2022 budget reflects estimated costs for setting up training, providing city staff with benefit
and compensation information, and other expenses based on experience. The 2019 and 2020
increase in other services and charges represented expenditures on professional services to
update the city’s pay scale. The 2022 personnel services budget includes a full step increase and
a 3.0% market rate wage increase. With the exception of contributions to the IT Services fund,
other budget items are expected to remain close to prior year levels.
114
PLANNING, ZONING & COMMUNITY DEVELOPMENT (101-41910)
DEPARTMENT: General Government SUPERVISOR: Community Development Director
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.
115
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2019 2020 2021 2022
Outcome/Effectiveness:
Grants awarded 1 1 1 1
Administrative applications (total)6 7 7 7
processed within 5 working days 6 7 7 7
Site Plan reviews processed
within 14 working days 1 4 0 2
Change in Use forms 8 3 8 5
reviewed withing 5 working days 8 3 5 5
Sign Permit zoning reviews 34 17 20 20
processed within 5 working days 31 16 20 20
Land Use applications processed 28 66 94 40
within 60 working days 21 65 90 40
Reconciliations processed 12 20 16 20
Annexation petitions 2 2 1 1
Efficiency:
Applications processed per FTE 56 44 47 40
Work Load:
Planning Applications:
Variances 2 3 5 1
CUPs 4 7 15 7
PUD/Amendments to PUD 9 11 15 5
Interim Use permits -1 $1 $1
Comp Plan amendments 3 3 0 0
Map amendments 6 3 2 5
Non-city zoning text amendments 1 2 1 1
Plats/adminstrative subdivisions 9 5 11 3
Administrative permits 6 7 7 5
Site plan reviews 1 2 2 2
Appeals 0 0 3 0
Vacations 1 2 4 2
Sign permit application review 34 17 20 20
Change in Use review 8 3 8 5
Total applications 84 66 94 57
Planning reconciliations 12 25 16 25
Planning Commission meetings 12 18 20 15
BCOL Advisory Meetings -4 4 4
PARC Meetings (Report Prep)-3 3 3
EDA Meetings 14 21 18 18
IEDC Meetings 11 12 8 12
GENERAL FUND 2019 2020 2021 2021 2022 %
PLANNING & ZONING Actual Actual Budget Projected Budget Change
Personnel Services 154,097$ 163,455$ 166,740$ 168,500$ 181,845$ 9.1%
Supplies 17 53 200 168 200 0.0%
Other Services & Charges 160,977 175,497 101,927 516,503 126,912 24.5%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 315,091$ 339,005$ 268,867$ 685,171$ 308,957$ 14.9%
116
BUDGET COMMENTARY:
The 2022 personnel services budget includes a full step increase and a 3.0% market rate wage
increase. Other services and charges in 2019 and 2020 include amounts for a comprehensive
plan update, and the receipt of a Community Energy Transitions (CET) grant from the State of
Minnesota’s Department of Employment and Economic Development (DEED) in 2021 led to
expenditures well over budget. The Monti:2040 Comprehensive Plan was adopted in 2020.
117
CITY HALL (101-41940)
DEPARTMENT: General Government SUPERVISOR: City Administrator
ACTIVITY SCOPE:
The activity for this department consists of maintenance and upkeep for the city hall suite.
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:
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
that contract plus utilities are the main expenditures in other services and charges.
Measurement 2019 2020 2021 2022
Number of times cleaned 104 51 104 104
Utility expenses $22,278 $18,327 $21,321 $22,000
GENERAL FUND 2019 2020 2021 2021 2022 %
CITY HALL Actual Actual Budget Projected Budget Change
Personnel Services 7,969$ 9,280$ -$ 2,579$ -$ ---
Supplies 139 921 2,000 - 2,000 0.0%
Other Services & Charges 58,314 50,300 84,910 65,516 68,687 -19.1%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 66,422$ 60,501$ 86,910$ 68,095$ 70,687$ -18.7%
118
LAW ENFORCEMENT (101-42100)
DEPARTMENT: Public Safety SUPERVISOR: City Administrator
ACTIVITY SCOPE:
All law enforcement services are contracted with the Wright County Sheriff's Department. The
Sheriff’s Department uses space at the new Fire Station for staff break time and other officing
uses. The Sheriff sets the hourly rate and the city contracts for the number of hours, 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:
BUDGET:
Measurement 2019 2020 2021 2022
Outcome/Effectiveness:
Arrests 206 262 204 200
Arrests to crimes ratio 0.22 0.34 0.26 0.25
Efficiency:
Hours contracted 18,980 19,032 18,980 18,980
Calls per hour contracted 0.48 0.43 0.41 0.44
Costs per workload unit $156.71 $180.04 $197.36 $191.97
Work Load:
Life quality calls, number of 3,774 3,178 2,693 3,200
Traffic calls, number of 3,912 4,051 4,074 4,000
Vehicle crashes, number of 388 270 325 325
Crimes, number of 949 773 770 800
GENERAL FUND 2019 2020 2021 2021 2022 %
LAW ENFORCEMENT Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 1,455,727 1,524,150 1,595,638 1,602,877 1,650,816 3.5%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 1,455,727$ 1,524,150$ 1,595,638$ 1,602,877$ 1,650,816$ 3.5%
119
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).
Hourly Hours
Year Rate Contracted
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
2022 $84.20 18,980
120
FIRE & RESCUE (101-42200)
DEPARTMENT: Public Safety SUPERVISOR: City Administrator
ACTIVITY SCOPE:
The Fire Department responds to fire, rescue, hazardous materials, medical, and accident
incidents within the city and the surrounding townships. The department also provides fire
inspection services. Paid-on-call volunteers provide the department’s staffing.
OBJECTIVES:
1. Assemble a confined space entry team with personnel and equipment.
2. Improve response times.
ISSUES:
1. Training and retention of paid-on-call personnel.
MEASURABLE WORKLOAD DATA:
Measurement 2019 2020 2021 2022
Outcome/Effectiveness:
Respondent-hours on fire calls:
City 3,152 2,433 2,903 3,005
Monticello Township 1,024 937 1,183 1,173
Silver Creek Township 698 434 385 532
Mutual Aid 399 636 406 423
Drills & Maintenance 2,628 2,053 2,310 2,638
Total 7,901 6,493 7,187 7,771
Efficiency:
Average respondent-hours per call
City 16 14 11 15
Monticello Township 16 17 15 20
Silver Creek Township 23 18 17 20
Mutual Aid 29 27 25 28
Drills & Maintenance 34 35 37 43
Total 20 20 16 22
Work Load:
Number of fire calls:
City 200 168 254 195
Monticello Township 63 56 80 59
Silver Creek Township 31 24 23 27
Mutual Aid 14 24 16 15
Drills & Maintenance 78 59 63 61
Total 386 331 436 357
121
BUDGET:
BUDGET COMMENTARY:
The Fire Department is staffed with paid-on-call volunteers. The purchase of turn-out gear
contributed to the high cost of supplies in 2019. Grants and donations may offset some of these
expenditures. Capital outlay reflects lease payments to the Central Equipment Fund for the
acquisition of a fire tender truck in 2014, a fire half-ton truck in 2019, and a new chief squad
vehicle in 2021 through the Central Equipment Fund.
GENERAL FUND 2019 2020 2021 2021 2022 %
FIRE Ac tual Actual Budget Projected Budget Change
Personnel Services 215,901$ 207,551$ 238,402$ 212,845$ 258,259$ 8.3%
Supplies 99,504 48,070 62,300 45,909 62,300 0.0%
Other Services & Charges 112,936 109,178 138,855 138,137 169,868 22.3%
Capital Outlay 49,600 49,600 62,700 62,700 62,700 0.0%
TOTAL EXPENDITURES 477,941$ 414,399$ 502,257$ 459,591$ 553,127$ 10.1%
122
FIRE RELIEF (101-42202)
DEPARTMENT: Public Safety SUPERVISOR: Finance Director
ACTIVITY SCOPE:
Providing a retirement benefit to paid-on-call volunteers, the fire relief activity is specifically
designed to track 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:
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.
Measurement 2019 2020 2021* 2022
Pension assets 1,209,943$ 1,472,948$ 1,673,130$ 1,450,000$
Pension liabilities 981,203$ 967,833$ 1,195,133$ 1,076,860$
Assets-liabilities ratio 1.23 1.52 1.35 1.35
Pension per service year $4,200 $4,200 $5,100 $4,500
Fire state aid $123,640 $131,638 $134,691 $135,000
State aid per employee $4,579 $4,539 $4,490 $4,500
Active firefighters 27 29 30 30
Deferred firefighters 6 5 5 5
*2021 assets and liabilities estimated per Form SC-21
GENERAL FUND 2019 2020 2021 2021 2022 %
FIRE RELIEF Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 123,640 131,638 135,000 134,691 140,000 3.7%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 123,640$ 131,638$ 135,000$ 134,691$ 140,000$ 3.7%
123
BUILDING INSPECTIONS (101-42400)
DEPARTMENT: Public Safety SUPERVISOR: Community Development Director
ACTIVITY SCOPE:
The Building Department inspects all new and remodeled construction within the city by a state
certified building inspector. The department 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:
BUDGET:
Measurement 2019 2020 2021 2022
Outcome/Effectiveness:
Value of permits issued 45,723,446$ 32,453,366$ 66,827,121$ 50,000,000$
Value of permits per FTE 15,241,149$ 10,817,789$ 22,275,707$ 12,500,000$
Efficiency:
Departmental FTEs 3 3 3 4
Rental inspections per FTE 515 539 589 450
Permits per FTE 279 319 297 297
Work Load:
Building permits issued 837 957 1008 890
Nuisance notices issued 116 71 82 75
Rental units, number of 1,545 1,616 1,766 1,800
GENERAL FUND 2019 2020 2021 2021 2022 %
BUILDING INSPECTIONS Actual Actual Budget Projected Budget Change
Personnel Services 284,425$ 299,690$ 436,572$ 367,552$ 462,137$ 5.9%
Supplies 4,968 4,412 5,500 41,500 5,500 0.0%
Other Services & Charges 30,479 45,949 24,285 74,746 30,114 24.0%
Capital Outlay 4,200 4,200 - 115,769 70,000 ---
TOTAL EXPENDITURES 324,072$ 354,251$ 466,357$ 599,567$ 567,751$ 21.7%
124
BUDGET COMMENTARY:
The 2022 personnel services budget includes a full step increase and a 3.0% 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; this
position was filled in late 2021. Capital outlay reflects the replacement of one building inspector
vehicle and the purchase of a new vehicle for the new inspector hired in 2021.
125
EMERGENCY MANAGEMENT (101-42500)
DEPARTMENT: Public Safety SUPERVISOR: Emergency Management Coordinator
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:
BUDGET COMMENTARY:
The 2022 budget is based on the 2021 budget with an increase in expenditures for supplies and
other services & charges related to a state grant received through Wright County. Much of this
activity's responsibilities had been transferred to Wright County. However, the city is an active
participant of the emergency management team, and, with the new Fire Marshal/Emergency
Management Coordinator position added in 2018, this budget unit will continue to see more
activity going forward.
Measurement 2019 2020 2021 2022
Data under development
GENERAL FUND 2019 2020 2021 2021 2022 %
EMERGENCY MANAGEMENT Actual Actual Budget Projected Budget Change
Personnel Services 3,068$ 587$ 3,224$ 1,615$ 3,224$ 0.0%
Supplies 1,286 104,835 100 8,781 9,000 8900.0%
Other Services & Charges 3,899 152,143 2,676 3,329 13,001 385.8%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 8,253$ 257,565$ 6,000$ 13,725$ 25,225$ 320.4%
126
ANIMAL CONTROL (101-42700)
DEPARTMENT: Public Safety SUPERVISOR: City Clerk
ACTIVITY SCOPE:
The city contracts with a private individual for animal control services. The city owns and
maintains the animal control facility. The city also contracts with nearby communities, allowing
them to use the city’s services and facility.
OBJECTIVES:
1. Address 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:
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 shown in the Measurable Workload Data.
Measurement 2019 2020 2021 2022
Stray a nimal reports 476 488 432 500
Barking dog reports 175 181 206 175
Lost/found reports 1,580 1,613 1,732 1,600
Feral cat trapping 266 282 284 250
Unsanitary condition reports 189 193 197 190
Abuse/neglect reports 163 176 186 170
Impounds 487 501 440 500
Dog bite reports 76 73 67 80
Animal control fees $43,320 $41,863 $52,482 $50,600
GENERAL FUND 2019 2020 2021 2021 2022 %
ANIMAL CONTROL Actual Actual Budget Projected Budget Change
Personnel Services 149$ 3,901$ -$ -$ -$ ---
Supplies 1,080 1,117 3,000 260 2,000 -33.3%
Other Services & Charges 45,480 44,504 53,842 50,326 57,971 7.7%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 46,709$ 49,522$ 56,842$ 50,586$ 59,971$ 5.5%
127
NATIONAL GUARD (101-42800)
DEPARTMENT: Public Safety SUPERVISOR: Project Coordinator
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:
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.
Measurement 2019 2020 2021 2022
Not Applicable
GENERAL FUND 2019 2020 2021 2021 2022 %
NATIONAL GUARD Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies - - - - - ---
Other Services & Charges 13,423 12,429 14,000 13,143 14,000 0.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 13,423$ 12,429$ 14,000$ 13,143$ 14,000$ 0.0%
128
PUBLIC WORKS ADMINISTRATION (101-43110)
DEPARTMENT: Public Works SUPERVISOR: Public Works Director
ACTIVITY SCOPE:
The public works (PW) administration activity oversees the daily operations of the 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, expansion of the wastewater
treatment plant, and future construction of a water 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 sewer funds.
ISSUES:
1. Balance the public works department needs with available funds.
2. Manage city's water and wastewater treatment systems.
3. Implement the capital improvement plan for city infrastructure.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The 2022 personnel services budget includes a full step increase and a 3.0% market rate wage
increase. The public works director/engineering position is spread over three budgets: General
Fund - 60%, Sewer Fund – 20%, Water Fund – 15%, and Stormwater Fund – 5%. In prior years,
the General Fund portion was allocated completely to PW Administration; however, the
Measurement 2019 2020 2021 2022
Budget units 17 16 15 15
Emplo yees supervised - FT 20 21 16 16
GENERAL FUND 2019 2020 2021 2021 2022 %
PW - ADMINISTRATION Actual Actual Budget Projected Budget Change
Personnel Services 205,853$ 193,099$ 204,379$ 209,417$ 114,579$ -43.9%
Supplies 2,957 6,423 6,000 6,118 7,000 16.7%
Other Services & Charges 19,815 22,359 32,961 28,818 36,094 9.5%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 228,625$ 221,881$ 243,340$ 244,353$ 157,673$ -35.2%
129
allocation was changed in 2022 by splitting it equally between PW Administration and
Engineering & Inspections. While other budget items may have large percentage changes, in
dollar terms they are relatively insignificant.
130
ENGINEERING (101-43111)
DEPARTMENT: Public Works SUPERVISOR: City Engineer
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. This department is combined with the Engineering & Inspections (101-
43115) department beginning in 2022 because the departments share the same staff and
overlap significantly.
OBJECTIVES:
1. See Engineering & Inspections Department.
ISSUES:
1. See Engineering & Inspections Department.
MEASURABLE WORKLOAD DATA:
See Engineering & Inspections Department.
BUDGET:
BUDGET COMMENTARY:
See Engineering & Inspections Department.
GENERAL FUND 2019 2020 2021 2021 2022 %
PW - ENGINEERING Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies 180 33 3,000 327 - -100.0%
Other Services & Charges 111,530 80,399 109,405 93,520 - -100.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 111,710$ 80,432$ 112,405$ 93,846$ -$ -100.0%
131
ENGINEERING & INSPECTIONS (101-43115)
DEPARTMENT: Public Works SUPERVISOR: City Engineer
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 along with the items noted in the previous Engineering (101-
43111) department.
OBJECTIVES:
1. Maintain certifications and attend appropriate classes and workshops for inspections.
2. Improve communication between public works, engineering, and inspection activities.
3. Improve knowledge, skills, and ability in GIS system and in using CarteGraph software
for development of an in-house Pavement Management and Sign Program.
4. Assist other city departments in acquiring utility information not readily available from
other sources, including GIS.
5. Complete cost estimates (capital infrastructure planning and budgeting) and design
for all improvement projects and continue to develop an in-house Pavement
Management Program.
6. Assist with design and implementation of solutions to drainage issues.
7. Complete inspections, documentation, and administration of city’s SWPPP.
8. Continue to educate the public on purposes and practices associated with
conservation and drainage easements and storm water ponds.
9. Create a one-stop shop for city driveway, grading, and right-of-way permits.
10. Continue to work towards improving transportation system and collaborate with
MNDOT and Wright County.
11. Work with other departments on public improvements and review development plans
and agreements.
12. Apply for grants and track funding for improvement projects.
ISSUES:
1. Workload is unevenly distributed throughout the year.
2. Increasing restrictions by Minnesota Pollution Control Agency (MPCA) for storm water
runoff.
3. Lack of public knowledge regarding purposes and practices associated with
conservation and drainage easements and storm water ponds.
4. Increasing phosphorus restrictions by MPCA for wastewater effluent.
5. Volatility in available federal and state funding for transportation improvements.
132
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The 2022 personnel services budget includes a full step increase and a 3.0% market rate wage
increase. The other increases reflect greater operating needs with the staff added in the
department in 2021. The engineering activity predominantly consists of engineering and other
professional service fees. These expenditures consist of both reimbursable and non-
reimbursable expenditures. The 2022 budget provides for continued improvements and
development of the city's GIS system and reduces reliance on consulting services.
Measurement 2019 2020 2021 2022
Service requests 72 90 90 90
On-line service requests 19 26 25 25
Improvement projects 12 14 16 16
Driveway permits issued 18 8 3 8
Right-of-way permits issued 99 88 87 100
Development applications 9 6 7 8
Grading permits issued 3 4 4 5
NPDES Inspections 370 327 383 350
Outfall Inspections 1 2 10 5
Stormwater Inspections 49 50 50 50
Pond Inspections 1 0 0 28
Inspection revenue $12,788 $13,695 $31,339 $61,440
Inspection hours billed 116.25 123.38 259.00 311.88
GENERAL FUND 2019 2020 2021 2021 2022 %
PW - ENG. & INSPECTIONS Actual Actual Budget Projected Budget Change
Personnel Services 83,488$ 95,811$ 147,970$ 95,509$ 195,211$ 31.9%
Supplies 463 635 9,000 1,751 21,000 133.3%
Other Services & Charges 6,096 5,664 12,662 10,325 137,472 985.7%
Capital Outlay - - - - 6,000 ---
TOTAL EXPENDITURES 90,047$ 102,110$ 169,632$ 107,586$ 359,683$ 112.0%
133
STREETS, ALLEYS & PARKING LOTS (101-43120)
DEPARTMENT: Public Works SUPERVISOR: Street Superintendent
ACTIVITY SCOPE:
The main responsibility of the streets and alleys activity is to perform the necessary tasks to
reduce the depreciation of the city streets and uphold desirable standards of appearance,
serviceability, and safety. This includes upkeep such as repair of roadway surface areas,
medians, sidewalks, boulevards, alleys, catch basins, and storm sewers.
OBJECTIVES:
1. 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:
BUDGET COMMENTARY:
The 2022 personnel services budget includes a full step increase and a 3.0% market rate wage
increase. Staff allocations were updated with some shifted to the Stormwater Fund for street
sweeping hours. This budget unit also shares staff with the Ice & Snow activity, which can
create significant fluctuations from year to year. Increases in capital outlay reflects purchases in
the Central Equipment Fund for equipment leased to the streets department. Other services &
charges decrease with much of the preventative maintenance being handled internally.
Measurement 2019 2020 2021 2022
Pounds of crack sealer 47,176 44,456 18,276 23,027
Sq. yards of chip sealing 76,655 103,000 0 0
Miles of streets 70.0 70.0 70.0 81.0
Tons of black top patching 492 443 527 400
GENERAL FUND 2019 2020 2021 2021 2022 %
PW - STREETS & ALLEYS Actual Actual Budget Projected Budget Change
Personnel Services 385,000$ 267,333$ 418,025$ 376,850$ 378,240$ -9.5%
Supplies 196,258 96,826 244,100 219,967 263,500 7.9%
Other Services & Charges 201,826 249,874 385,469 75,635 184,656 -52.1%
Capital Outlay 137,300 163,600 247,100 247,100 297,900 20.6%
TOTAL EXPENDITURES 920,384$ 777,633$ 1,294,694$ 919,551$ 1,124,296$ -13.2%
134
ICE & SNOW REMOVAL (101-43125)
DEPARTMENT: Public Works SUPERVISOR: Street Superintendent
ACTIVITY SCOPE:
The city's ice and snow removal activity is responsible for the control of ice and snow on city
streets, sidewalks, and city-owned public parking lots. The activity provides control in a safe and
cost-effective manner while keeping in mind safety, 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:
BUDGET COMMENTARY:
The 2022 personnel services budget includes a full step increase and a 3.0% market rate wage
increase. Weather variability greatly impacts budget-to-actual comparisons.
Measurement 2019 2020 2021 2022
Inches o f snow 62 29 26 50
Plowing events, number of 20 22 34 25
Tons of salt used 752 730 700 900
Tons of sand used 432 400 0 0
GENERAL FUND 2019 2020 2021 2021 2022 %
PW - ICE & SNOW Actual Actual Budget Projected Budget Change
Personnel Services 334,514$ 232,200$ 218,101$ 154,847$ 244,828$ 12.3%
Supplies 114,503 90,158 150,200 133,850 155,000 3.2%
Other Services & Charges 5,590 3,762 7,299 5,617 7,298 0.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 454,607$ 326,120$ 375,600$ 294,313$ 407,126$ 8.4%
135
SHOP & GARAGE (101-43127)
DEPARTMENT: Public Works SUPERVISOR: Street Superintendent
ACTIVITY SCOPE:
Shop & Garage maintains all city vehicles and equipment for the streets, ice & snow, parks,
water, and sewer 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:
BUDGET COMMENTARY:
The 2022 personnel services budget includes a full step increase and a 3.0% market rate wage
increase along with allocation adjustments for staff in the Public Works department. As
increased focus on preventative maintenance contributes to increased supplies costs.
Measurement 2019 2020 2021 2022
Service orders 91 87 100 95
Service order hours 370 270 401 375
Hours per service order 4.1 3.1 4.0 3.9
Total service order costs $23,797 $8,438 $27,000 $25,000
Service cost per order $261.51 $96.99 $270.00 $263.16
Repair orders 70 62 70 75
Repair hours 413 303 420 425
Hours per repair order 5.9 4.9 6.0 5.7
Total repair order costs $46,532 $30,267 $40,000 $48,000
Repair costs per order $664.74 $488.18 $571.43 $640.00
GENERAL FUND 2019 2020 2021 2021 2022 %
PW - SHOP & GARAGE Actual Actual Budget Projected Budget Change
Personnel Services 98,213$ 110,655$ 106,115$ 130,946$ 160,308$ 51.1%
Supplies 31,644 47,563 65,500 48,723 74,500 13.7%
Other Services & Charges 48,206 41,092 85,317 89,523 80,438 -5.7%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 178,063$ 199,310$ 256,932$ 269,192$ 315,246$ 22.7%
136
STORMWATER (101-43130)
DEPARTMENT: Public Works SUPERVISOR: Public Works Director
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 absorbed the operations of this department in 2020.
OBJECTIVES:
1. None.
ISSUES:
1. None.
MEASURABLE WORKLOAD DATA:
See the Stormwater enterprise Fund.
BUDGET:
BUDGET COMMENTARY:
See the Stormwater enterprise Fund.
GENERAL FUND 2019 2020 2021 2021 2022 %
PW - STORMWATER Actual Actual Budget Projected Budget Change
Personnel Services 17,026$ -$ -$ -$ -$ ---
Supplies 8,012 - - - - ---
Other Services & Charges 2,612 - - - - ---
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 27,650$ -$ -$ -$ -$ ---
137
STREET LIGHTING (101-43160)
DEPARTMENT: Public Works SUPERVISOR: Street Superintendent
ACTIVITY SCOPE:
The street Iighting activity maintains new and existing street lighting within the city. This
includes maintaining installed bulbs and fixtures, as well as the electricity used for keeping the
lights on.
OBJECTIVES:
1. 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:
BUDGET COMMENTARY:
Electricity for the streetlights is the largest expenditure at $170,000. Other services and charges
include $35,000 for repairs and maintenance of traffic signals.
Measurement 2019 2020 2021 2022
Street lights maintained*973 973 973 990
*Includes those owned by the city and Xcel Energy.
GENERAL FUND 2019 2020 2021 2021 2022 %
PW - STREET LIGHTING Actual Actual Budget Projected Budget Change
Personnel Services 5,815$ 5,278$ -$ 2,218$ -$ ---
Supplies 18,698 4,778 20,000 3,219 20,000 0.0%
Other Services & Charges 186,435 181,773 217,000 189,619 217,000 0.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 210,948$ 191,829$ 237,000$ 195,055$ 237,000$ 0.0%
138
REFUSE COLLECTION (101-43230)
DEPARTMENT: Public Works SUPERVISOR: Refuse Collection
ACTIVITY SCOPE:
The city contracts with a private hauler for residential refuse and recycling collection services.
OBJECTIVES:
1. 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:
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 residents/customers.
Measurement 2019 2020 2021 2022
Residential refuse collections 52 52 52 52
Residential recycling collections 26 26 26 26
Residential container base 3,945 3,992 4,091 4,250
Additional containers 609 627 644 650
Recycling containers 4,534 4,581 4,680 4,800
GENERAL FUND 2019 2020 2021 2021 2022 %
REFUSE COLLECTION Actual Actual Budget Projected Budget Change
Personnel Services 195$ -$ 576$ -$ 576$ 0.0%
Supplies - - - - - ---
Other Services & Charges 610,749 681,948 722,360 754,132 802,302 11.1%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 610,944$ 681,948$ 722,936$ 754,132$ 802,878$ 11.1%
139
SENIOR CENTER (101-45175)
DEPARTMENT: Recreation and Culture SUPERVISOR: City Administrator
ACTIVITY SCOPE:
The senior center facility is housed in the Monticello Community Center complex. The facility is
maintained by the city, but senior center management is provided by an outside entity.
OBJECTIVES:
1. Maintain a clean, modern facility for use by Monticello’s senior citizens.
2. 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:
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 2022 adopted contribution is $65,000, which is the same as
2021.
Measurement 2019 2020 2021 2022
Outcomes/Effectiveness
Volunteers hours 8,923 3,511 5,631 7,000
Noon meals served 3,609 919 1,799 2,500
Work Load:
Unduplicated participants 2,563 1,579 1,762 2,000
Duplicated participants 22,973 8,072 16,225 20,000
Received phone calls 4,400 2,748 3,439 3,800
Activities offered 134 89 104 120
GENERAL FUND 2019 2020 2021 2021 2022 %
SENIOR CENTER Actual Actual Budget Projected Budget Change
Personnel Services 21$ 980$ 863$ 635$ 863$ 0.0%
Supplies - 82 - - - ---
Other Services & Charges 102,148 102,600 105,500 105,054 105,500 0.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 102,169$ 103,662$ 106,363$ 105,689$ 106,363$ 0.0%
140
PARK OPERATIONS (101-45201)
DEPARTMENT: Recreation and Culture SUPERVISOR: Parks Superintendent
ACTIVITY SCOPE:
The park operations activity maintains the parks and trails within the city and at the city’s area
of the Bertram Chain of Lakes Regional Park. 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:
BUDGET COMMENTARY:
The parks budget consists of expenditures needed to maintain city parks and trails. The 2022
personnel services budget includes a full step increase and a 3.0% market rate wage increase
and reflects a shift from Parks operating as part of Public Works to a Parks, Arts, and Recreation
Department that combines resources with the Monticello Community Center. A director of the
new department increases costs to the Parks Operations activity but saved costs in the
Monticello Community Center Fund. Capital outlay reflects the acquisition of capital equipment
through the Central Equipment internal service fund. Additional Central Equipment Fund
purchases are planned for 2022.
Measurement 2019 2020 2021 2022
Park land acres maintained 360 360 365 375
Trail miles maintained 41.0 41.0 42.0 42.0
Park events held 520 63 100 105
Winter skating days 120 120 120 120
GENERAL FUND 2019 2020 2021 2021 2022 %
PARK - OPERATIONS Actual Actual Budget Projected Budget Change
Personnel Services 518,075$ 575,682$ 578,809$ 601,077$ 692,576$ 19.7%
Supplies 150,226 177,195 177,000 197,544 185,000 4.5%
Other Services & Charges 149,381 174,388 179,000 173,021 210,828 17.8%
Capital Outlay 107,800 113,400 126,800 126,800 141,800 11.8%
TOTAL EXPENDITURES 925,482$ 1,040,665$ 1,061,609$ 1,098,442$ 1,230,204$ 15.9%
141
PARK BALLFIELDS (101-45203)
DEPARTMENT: Recreation and Culture SUPERVISOR: Parks Superintendent
ACTIVITY SCOPE:
The park ballfields activity prepares and maintains city athletic fields, including the NSP (Xcel)
Ballfields.
OBJECTIVES:
1. Prepare and maintain city athletic fields.
2. Improve the structures at the ballfields.
3. Enhance player and visitor experience.
ISSUES:
1. Demographic and activity trends.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The 2022 budget matches the 2020 budget for field maintenance, concessions, and park
activities but shifts some expenditures from supplies to other services & charges, which
includes items that do not meet the capitalization threshold.
Measurement 2019 2020 2021 2022
Ball games played, number of 625 100 650 650
Soccer fields maintained 27 32 35 40
Lacrosse fields maintained 8 10 10 12
Ball fields maintained 7 7 7 7
Number of times mowed 50 50 50 50
GENERAL FUND 2019 2020 2021 2021 2022 %
PARK - BALLFIELDS Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies 9,359 10,536 15,600 10,126 10,600 -32.1%
Other Services & Charges 10,477 13,149 11,800 17,946 16,800 42.4%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 19,836$ 23,685$ 27,400$ 28,072$ 27,400$ 0.0%
142
PUBLIC ARTS (101-45204)
DEPARTMENT: Recreation and Culture SUPERVISOR: Parks Superintendent
ACTIVITY SCOPE:
The public arts activity is a focused use of arts and culture as a catalyst for economic and
community development. While art in and of itself can be valuable, the purpose is to harness
the creative energy within the community and channel it into revitalizing downtown and
creating connections between people and community.
OBJECTIVES:
1. Enhance the community aesthetics and revitalize downtown.
2. Engage the community in creating public art.
3. Connect people to the community.
ISSUES:
1. Perception of need.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
2019 represented the inaugural, stand-alone budget for the public arts initiative. 2021 and
2022 other services and charges include contracting for an additional creative consultant with
increased participation of the community, and the 2022 budget increases to reflect anticipated
projects funded through Central Minnesota Arts Board (CMAB) grants. This budget unit is also
responsible for utilities and repairs at the MontiArts building.
Measurement 2019 2020 2021 2022
Projects 2 7 15 15
Events -31 45 52
GENERAL FUND 2019 2020 2021 2021 2022 %
PARK - PUBLIC ARTS Actual Actual Budget Projected Budget Change
Personnel Services -$ -$ -$ -$ -$ ---
Supplies 6,340 3,047 4,300 6,010 6,800 58.1%
Other Services & Charges 40,614 33,045 53,200 87,235 65,441 23.0%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 46,954$ 36,092$ 57,500$ 93,246$ 72,241$ 25.6%
143
LIBRARY (101-45501)
DEPARTMENT: Recreation and Culture SUPERVISOR: City Administrator
ACTIVITY SCOPE:
Library services are contracted through the Great River Regional Library System. The city owns
and maintains the library building and provides programs through the library to residents.
OBJECTIVES:
1. 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:
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 2022 estimated expenditures are consistent with prior year levels with slight
adjustments to utilities and maintenance expenditures causing a minor decrease in the budget.
By statute, the city must annually expend at least $35,160 for the library.
Measurement 2019 2020 2021 2022
Checked out items 171,460 112,334 143,223 150,000
Number of requests placed 9,190 7375 4,997 5,200
Summer reading participants 1,159 148 377 550
Winter reading participants 207 209 55 65
Patrons using wireless 4,022 1355 1,933 2,000
Patrons using internet stations 6,362 -** **
Internet sessions used -160 208 400
Programs offered 243 102 104 125
Program attendance 4,788 4810* 1,772 2,300
* Some programs offered after March 17, 2020 were virtual and offered only on
Facebook so counts are based on number of views on FB.
**We no longer measure this statistic.
GENERAL FUND 2019 2020 2021 2021 2022 %
LIBRARY A ctual Actual Budget Projected Budget Change
Personnel Services 220$ 1,901$ -$ 1,848$ -$ ---
Supplies 2,943 1,725 2,500 1,517 2,500 0.0%
Other Services & Charges 50,429 44,442 51,214 41,141 50,896 -0.6%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 53,592$ 48,068$ 53,714$ 44,506$ 53,396$ -0.6%
144
SHADE TREE (101-46102)
DEPARTMENT: Recreation and Culture SUPERVISOR: Park Superintendent
ACTIVITY SCOPE:
Shade Tree consists of planting and maintaining trees and shrubbery within the city limits. This
activity provides for regulating, developing, planting, maintaining, and removing of trees in any
street, park, right-of-way, or other public place. Shade trees aid the larger goal of soil
conservation, climate moderation, air quality, 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:
BUDGET COMMENTARY:
A portion of the total time of park employees is allocated to the Shade Tree activity. The 2022
personnel services budget includes a full step increase and a 3.0% market rate wage increase.
Part of the personnel services change reflects the reallocation of wages within recreation and
culture activities. Supplies budgets increased in 2021 and 2022 with a greater focus on
prioritizing new plantings.
Measurement 2019 2020 2021 2022
Trees planted 314 220 300 245
Trees removed 15 6 25 15
Students in programs 500 500 0 0
GENERAL FUND 2019 2020 2021 2021 2022 %
SHADE TREE A ctual Actual Budget Projected Budget Change
Personnel Services 45,052$ 70,496$ 72,448$ 74,621$ 88,043$ 21.5%
Supplies 9,118 8,418 28,000 10,824 26,020 -7.1%
Other Services & Charges 7,226 110 4,617 2,081 4,112 -10.9%
Capital Outlay - - - - - ---
TOTAL EXPENDITURES 61,396$ 79,024$ 105,065$ 87,526$ 118,175$ 12.5%
145
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146
2022 ADOPTED BUDGETSpecial 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
TOTAL SPECIAL REVENUE FUNDS 2019 2020 2021 2021 2022 %
REVEN UES ACTUAL ACTUAL BUDGET PROJ ECTED BUDGET CHANGE
Property Taxes 749,881$ 771,390$ 851,300$ 852,765$ 873,000$ 2.5%
Tax Increments 679,925 707,824 617,344 732,688 630,344 2.1%
Franchise & Other Taxes 634 690 - 662 - ---
Intergovernmental Revenues - 227,827 - 725,000 425,000 ---
Charges for Services 1,413,407 542,346 456,600 828,981 931,900 104.1%
Miscellaneous 254,230 172,626 209,756 340,373 67,756 -67.7%
Operating Transfers In - 425,000 325,000 2,368 6,000 -98.2%
TOTAL REVENUES 3,098,077$ 2,847,703$ 2,460,000$ 3,482,837$ 2,934,000$ 19.3%
EXPENDITURES
Personnel Services 1,261,954$ 1,008,315$ 880,961$ 923,700$ 1,246,373$ 41.5%
Supplies 194,706 96,372 78,420 56,259 120,900 54.2%
Other Services & Charges 1,171,929 2,069,919 737,295 997,976 962,826 30.6%
Capital Outlay 528,605 403,069 190,324 31,516 191,976 0.9%
Operating Transfers Out 230,000 200,000 200,000 623,700 197,925 -1.0%
TOTAL EXPENDITURES 3,387,194$ 3,777,675$ 2,087,000$ 2,633,152$ 2,720,000$ 30.3%
FUND BALANCE - JANUARY 1 8,772,303$ 8,483,186$ 7,553,214$ 7,553,214$ 8,402,899$
Excess (Deficiency) of
Revenues over Expenditures (289,117) (929,972) 373,000 849,685 214,000
FUND BALANCE - DECEMBER 31 8,483,186$ 7,553,214$ 7,926,214$ 8,402,899$ 8,616,899$
147
ECONOMIC DEVELOPMENT AUTHORITY FUND (213-46301)
DEPARTMENT: Economic Development SUPERVISOR: Economic Development Manager
ACTIVITY SCOPE:
The Monticello Economic Development Authority (EDA) is responsible for the on-going
redevelopment efforts within the city. This consists of housing and businesses, including all
related public improvements and land acquisitions. These programs are administered, based
on direction of the EDA board, by the Economic Development Manager. In addition, all tax
increment financing districts are initiated and administered by the EDA. There are currently 9
active tax increment districts and 2 decertified, active districts. 3 additional TIF district
applications have been received and are in the process of approval. 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.
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.
148
MEASURABLE WORKLOAD DATA:
BUDGET:
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. One district collected increment for the first time in 2020, and one
has an estimated first increment in 2022. Under Section 469.033, subd. 6, of the HRA Act, the
HRA’s special benefit tax is levied annually and is limited to 0.0185% of the taxable market
value. The increase in miscellaneous revenues in 2021 was an anticipated land sale. The
higher capital outlay expenditures in 2020 were 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.
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.
Measurement 2019 2020 2021 2022
Property acquisitions 2 4 1 1
GMEF loans outstanding 2 2 3 5
Active TIF districts 8 10 11 14
EDA FUND 2019 2020 2021 2021 2022 %
REVEN UES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 347,881$ 354,390$ 366,300$ 367,765$ 388,000$ 5.9%
Tax Increments 679,925 707,824 617,344 732,688 630,344 2.1%
Franchise & Other Taxes 634 690 - 662 - ---
Intergovernmental Revenues - 185,000 - - 25,000 ---
Charges for Services - 4,550 - 26,951 - ---
Miscellaneous 157,644 82,465 202,356 304,001 43,656 -78.4%
Operating Transfers In - - - 2,368 6,000 ---
TOTAL REVENUES 1,186,084$ 1,334,919$ 1,186,000$ 1,434,435$ 1,093,000$ -7.8%
EXPENDITURES
Personnel Services 127,129$ 134,190$ 137,597$ 131,343$ 172,135$ 25.1%
Supplies 146 - 200 54 200 0.0%
Other Services & Charges 601,606 1,757,517 289,879 595,446 324,764 12.0%
Capital Outlay 154,404 35,496 190,324 31,516 191,976 0.9%
Operating Transfers Out 230,000 200,000 200,000 198,700 197,925 -1.0%
TOTAL EXPENDITURES 1,113,285$ 2,127,203$ 818,000$ 957,060$ 887,000$ 8.4%
FUND BALANCE - JANUARY 1 7,240,465$ 7,313,264$ 6,520,980$ 6,520,980$ 6,998,356$
Excess (Deficiency) of
Revenues over Expenditures 72,799 (792,284) 368,000 477,376 206,000
FUND BALANCE - DECEMBER 31 7,313,264$ 6,520,980$ 6,888,980$ 6,998,356$ 7,204,356$
149
CEMETERY FUND (215-49010)
DEPARTMENT: Recreation and Culture SUPERVISOR: Parks Superintendent
ACTIVITY SCOPE:
The Cemetery Fund sustains itself with revenues from plot sales and from services, such as
excavations, staking for monuments, memorial programs, and perpetual care. The city
maintains two cemeteries: Riverside and Hillside. Staff 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 2019 2020 2021 2022
Plot occupied 3,575 3,598 3,626 3,626
Plots reserved 683 683 683 683
Plots available for sale 1,132 1,119 1,092 1,092
Number of plots sold 10 11 23 20
Number of internments 21 22 28 20
Number of markers staked 12 15 9 9
Columbarium slots occupied -6 9 13
Columbarium slots reserved 2 2 3 3
Columbarium slots available 94 88 84 80
Columbarium slots sold -6 4 4
Ossuary slots occupied ----
Ossuary slots reserved 50 50 50 50
Ossuary slots available 265 265 265 265
Ossuary slots sold 50 0 0 0
150
BUDGET:
BUDGET COMMENTARY:
In 2019, the city acquired an ossuary-columbarium. Other expenditures are estimated near
prior year levels. 2019 charges for services includes the sale of 50 ossuary slots to a local
hospital for $20,000.
CEMETERY 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJ ECTED BUDGET CHANGE
Charges for Services 52,405$ 40,884$ 32,900$ 53,891$ 32,900$ 0.0%
Miscellaneous 1,670 15,701 100 (282) 100 0.0%
TOTAL REVENUES 54,075$ 56,585$ 33,000$ 53,609$ 33,000$ 0.0%
EXPENDITURES
Personnel Services 2,597$ 2,982$ 2,652$ 3,628$ 2,228$ -16.0%
Supplies 2,338 60 1,100 1,314 1,100 0.0%
Other Services & Charges 20,219 24,279 29,248 23,823 29,672 1.4%
Capital Outlay 54,906 - - - - ---
TOTAL EXPENDITURES 80,060$ 27,321$ 33,000$ 28,764$ 33,000$ 0.0%
FUND BALANCE - JANUARY 1 52,060$ 26,075$ 55,339$ 55,339$ 80,183$
Excess (Deficiency) of
Revenues over Expenditures (25,985) 29,264 - 24,844 -
FUND BALANCE - DECEMBER 31 26,075$ 55,339$ 55,339$ 80,183$ 80,183$
151
SMALL CITIES DEVELOPMENT PROGRAM (SCDP) FUND (221-46500)
DEPARTMENT: Small Cities Development Program Fund SUPERVISOR: Community Development Director
ACTIVITY SCOPE:
Following state and federal guidelines, the SCDP Fund administers loans to local businesses.
OBJECTIVES:
1. Match available funds with qualifying businesses in Monticello.
ISSUES:
1. Number of qualified businesses in Monticello.
2. Loan program and bank requirements.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
Repayment of loans and interest earned on investments make up the anticipated activity in
2022. The city’s pooled investment market value adjustment was negative in 2021, offsetting
much of the interest earned on the outstanding loan.
Measurement 2019 2020 2021 2022
Loans outstanding 1 1 1 1
SCDP FUND 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Miscellaneous 31,382$ 20,173$ 5,000$ 84$ 8,000$ 60.0%
FUND BALANCE - JANUARY 1 872,983$ 904,365$ 924,538$ 924,538$ 924,622$
Excess (Deficiency) of
Revenues over Expenditures 31,382 20,173 5,000 84 8,000
FUND BALANCE - DECEMBER 31 904,365$ 924,538$ 929,538$ 924,622$ 932,622$
152
COMMUNITY CENTER FUND (226-4512x)
DEPARTMENT: Community Center SUPERVISOR: Parks, Arts & Recreation Director
ACTIVITY SCOPE:
The Monticello Community Center (MCC) provides space for a variety of recreational,
professional, and educational opportunities. Expenditures for the community center are
divided into six activities: administration, rentals and events, aquatics, guest services and
concessions, maintenance, and programming.
OBJECTIVES:
1. 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 2019 2020 2021 2022
Customer visits, number of 184,106 71,632 94,448 113,337
Gross program sales 112,506$ 17,930$ 44,937$ 53,924$
Annual memberships 1,457 1,150 343 411
Monthly memberships 1,878 1,433 843 1,011
Three-month memberships 1,749 308 153 183
Ratio of annual memberships
to other memberships 0.40 0.66 0.34 0.34
Rental revenue 197,352$ 73,096$ 127,144$ 152,573$
Numbers dropped significantly in 2020 due to the COVID-19 pandemic. 2022 amounts
are estimated conservatively as local operations restrictions are subject to change.
153
BUDGET:
BUDGET COMMENTARY:
The MCC’s largest revenue sources are charges for services (memberships and day passes) and
property taxes. Other revenues include concession sales, room rentals, and program fees.
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 a transfer
from the Liquor Fund to avoid a negative fund balance. Activities in the facility increased in
2021, while still impacted by the pandemic. Use of $725,000 of American Rescue Plan Act
(ARPA) funding in 2021 brought back stability to the fund balance. The current labor market
necessitated a larger increase for many of the part time positions. Uncertainty over how quickly
patron levels will return to pre-pandemic levers, the 2022 budget is conservative in estimating
revenues and liberal in estimating potential costs. For 2020, all capital expenditures were
halted when the pandemic began and are delayed conserving resources. Capital outlay in 2022
relates to security camera upgrades, which are handled through the IT Services internal service
fund.
COMMUNITY CENTER 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 402,000$ 417,000$ 485,000$ 485,000$ 485,000$ 0.0%
Intergovernmental Revenues - 42,827 - 725,000 400,000 ---
Charges for Services 1,361,002 496,912 423,700 748,139 899,000 112.2%
Miscellaneous 63,534 54,287 2,300 36,570 16,000 595.7%
Operating Transfers In - 425,000 325,000 - - -100.0%
TOTAL REVENUES 1,826,536$ 1,436,026$ 1,236,000$ 1,994,709$ 1,800,000$ 45.6%
EXPENDITURES
Personnel Services 1,132,228$ 871,143$ 740,712$ 788,729$ 1,072,010$ 44.7%
Supplies 192,222 96,312 77,120 54,891 119,600 55.1%
Other Services & Charges 550,104 288,123 418,168 378,708 608,390 45.5%
Capital Outlay 319,295 367,573 - - - ---
Operating Transfers Out - - - 425,000 - ---
TOTAL EXPENDITURES 2,193,849$ 1,623,151$ 1,236,000$ 1,647,328$ 1,800,000$ 45.6%
FUND BALANCE - JANUARY 1 606,795$ 239,482$ 52,357$ 52,357$ 399,738$
Excess (Deficiency) of
Revenues over Expenditures (367,313) (187,125) - 347,381 -
FUND BALANCE - DECEMBER 31 239,482$ 52,357$ 52,357$ 399,738$ 399,738$
154
2022 ADOPTED BUDGETDebt 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
seven active debt service (sub)funds that are combined into one debt service fund for financial reporting.
BUDGET ISSUES
The city's bond rating was downgraded from Aa3 to A2 by Moody's Investor Services in 2012. This rating
was upgraded to A1 with the sale of the city’s 2019A debt issue in 2019 and 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.
BUDGET SUMMARY
TOTAL DEBT SERVICE FUNDS 2019 2020 2021 2021 2022 %
REVEN UES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 2,227,646$ 2,939,987$ 2,831,479$ 2,831,479$ 2,311,400$ -18.4%
Special Assessments 373,337 469,028 229,595 272,950 222,472 -3.1%
Miscellaneous 48,275 15,864 8,926 (7,195) 7,203 -19.3%
Operating Transfers In 345,000 200,000 200,000 3,975,237 197,925 -1.0%
TOTAL REVENUES 2,994,258$ 3,624,879$ 3,270,000$ 7,072,472$ 2,739,000$ -16.2%
EXPENDITURES
Other Services & Charges -$ 1,372$ -$ 8,850$ 1,200$ ---
Debt Service 3,489,241 4,140,536 3,325,000 7,243,943 2,812,800 -15.4%
Operating Transfers Out 75,000 - - - 111,000 ---
TOTAL EXPENDITURES 3,564,241$ 4,141,908$ 3,325,000$ 7,252,793$ 2,925,000$ -12.0%
FUND BALANCE - JANUARY 1 2,391,544$ 1,821,561$ 1,304,532$ 1,304,532$ 1,124,210$
Excess (Deficiency) of
Revenues over Expenditures (569,983) (517,029) (55,000) (180,322) (186,000)
FUND BALANCE - DECEMBER 31 1,821,561$ 1,304,532$ 1,249,532$ 1,124,210$ 938,210$
155
2011A G.O. BOND SUB-FUND (312-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
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 bond 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:
Measurement 2019 2020 2021 2022
Assessment balance $2,535,167 $0 $0 $0
Assessment balance deferred $1,972,819 $0 $0 $0
Deferred % of balance 78% 0% 0% 0%
Delinquent balance $0 $0 $0 $0
Prepaid assessments $0 $0 $0 $0
Assessment rolls 4 0 0 0
Assessed parcels 7 0 0 0
2011A G.O. BOND FUND (2005A)2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 150,581$ 172,641$ -$ -$ -$ ---
Special Assessments 52,715 113,348 - - - ---
Miscellaneous 18,037 (8,015) 1,000 (77) 75 -92.5%
Operating Transfers In 205,000 200,000 200,000 198,700 197,925 -1.0%
TOTAL REVENUES 426,333$ 477,974$ 201,000$ 198,623$ 198,000$ -1.5%
EXPENDITURES
Other Services & Charges -$ 196$ -$ 1,357$ -$ ---
Debt Service 429,521 1,259,466 200,000 199,175 199,000 -0.5%
Operating Transfers Out - - - - 111,000 ---
TOTAL EXPENDITURES 429,521$ 1,259,662$ 200,000$ 200,532$ 310,000$ 55.0%
FUND BALANCE - JANUARY 1 896,336$ 893,148$ 111,460$ 111,460$ 109,551$
Excess (Deficiency) of
Revenues over Expenditures (3,188) (781,688) 1,000 (1,909) (112,000)
FUND BALANCE - DECEMBER 31 893,148$ 111,460$ 112,460$ 109,551$ (2,449)$
156
BUDGET COMMENTARY:
The city issued $10,735,000 in 2011 G.O. Refunding Bonds to advance refund the 2005A G.O.
Improvement Bonds on February 1, 2013. The revenue sources include a combination of
development fees, property taxes, special assessments, and tax increments. With the partial
redemption in 2020, the remaining balance is expected to be paid using transfers in from tax
increment received in the Economic Development Authority (EDA) fund. All assessment
balances were transferred to the Capital Projects fund in 2020.
REMAINING DEBT SERVICE:
Payable Principal Interest Rate Total
2/1/2022 195,000$ 2,925$ 3.00% 197,925$
GO Refunding Bonds, Series 2011A
157
2015B G.O. BOND SUB-FUND (319-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The 2015B G.O. Street Reconstruction and Improvement Bonds provided financing for School
Boulevard, Fallon Avenue, and 85th Street improvements. This issue also provided financing for
street and other infrastructure improvements in the area east of Highway 25 and north of
Interstate 94. The city levies for the gap between annual debt service payments and annual
assessment collections. The bonds have an average interest rate of 2.5856% and 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. Accumulating resources for early redemption.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2019 2020 2021 2022
Assessment balance $103,170 $92,013 $68,780 $51,585
Deferred assessments $0 $0 $0 $0
Deferred % of balance 0% 0% 0% 0%
Delinquent balance $0 $0 $0 $0
Prepaid assessments $0 $0 $4,629 $0
Assessment rolls 1 1 2 1
Assessed parcels 1 1 28 1
2015B G.O. Bonds 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 200,905$ 198,385$ 201,115$ 201,115$ 192,650$ -4.2%
Special Assessments 23,514 23,416 22,720 27,767 21,776 -4.2%
Miscellaneous 4,448 2,557 1,165 (786) 1,574 35.1%
TOTAL REVENUES 228,867$ 224,358$ 225,000$ 228,096$ 216,000$ -4.0%
EXPENDITURES
Other Services & Charges -$ 196$ -$ 357$ 200$ ---
Debt Service 213,546 211,891 214,000 213,550 210,800 -1.5%
TOTAL EXPENDITURES 213,546$ 212,087$ 214,000$ 213,907$ 211,000$ -1.4%
FUND BALANCE - JANUARY 1 94,095$ 109,416$ 121,687$ 121,687$ 135,876$
Excess (Deficiency) of
Revenues over Expenditures 15,321 12,271 11,000 14,189 5,000
FUND BALANCE - DECEMBER 31 109,416$ 121,687$ 132,687$ 135,876$ 140,876$
158
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 $175,000 on
school district property and property taxes. The tax levy covers the gap between assessment
revenue and debt service payments. Developer fees were assessed to the platted parcels in
2021 causing an increase in assessment rolls and assessed parcels related to the bond issue.
REMAINING DEBT SERVICE:
Payable Principal Interes t Rate Total
6/15/2022 -$ 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 1,665,000$ 245,000$ 1,910,000$
GO Bonds, Series 2015B
159
2016A G.O. BOND SUB-FUND (320-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The 2016A G.O. Street Reconstruction and Improvement Bonds financed improvements
included in the 2016 core street project and at the intersection of Highway 25 and 7th Street.
The city levies for the gap between annual debt service payments and annual assessment
collections. The bonds have an average interest rate of 2.1034% and are redeemable in
December of 2023.
OBJECTIVES:
1. Make scheduled debt payments in a timely manner.
2. Redeem or refund when feasible.
ISSUES:
1. Balancing the property tax levy for this bond with the needs of other debt.
2. Accumulating resources for early redemption.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2019 2020 2021 2022
Assessment balance $516,625 $396,383 $316,688 $253,776
Deferred assessments $0 $0 $0 $0
Deferred % of balance 0% 0% 0% 0%
Delinquent balance $0 $0 $0 $0
Prepaid assessments $21,619 $46,478 $9,621 $0
Assessment rolls 2 2 2 2
Assessed parcels 85 76 76 70
2016A G.O. Bonds 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 409,134$ 405,039$ 406,089$ 406,089$ 406,929$ 0.2%
Special Assessments 123,176 145,564 81,422 91,510 78,800 -3.2%
Miscellaneous 14,970 8,875 1,489 (2,524) 1,271 -14.6%
TOTAL REVENUES 547,280$ 559,478$ 489,000$ 495,075$ 487,000$ -0.4%
EXPENDITURES
Other Services & Charges -$ 196$ -$ 357$ 200$ ---
Debt Service 529,096 525,941 527,000 526,000 527,800 0.2%
TOTAL EXPENDITURES 529,096$ 526,137$ 527,000$ 526,357$ 528,000$ 0.2%
FUND BALANCE - JANUARY 1 348,442$ 366,626$ 399,967$ 399,967$ 368,685$
Excess (Deficiency) of
Revenues over Expenditures 18,184 33,341 (38,000) (31,282) (41,000)
FUND BALANCE - DECEMBER 31 366,626$ 399,967$ 361,967$ 368,685$ 327,685$
160
BUDGET COMMENTARY:
The $4,900,000 2016A G.O. bond issue has two components: $770,000 street reconstruction
portion and $4,130,000 improvement portion. Property taxes support the reconstruction
portion of the debt issue. The improvement portion is supported by assessments of $1,143,000
in the core street reconstruction area. Property taxes are levied for the gap between
assessment revenue and debt service payments. Future levies will be adjusted to reflect
assessment prepayments, interest earned on the prepayments and interest foregone on the
prepayments.
REMAINING DEBT SERVICE:
Payable Principal Interes t Rate Total
6/15/2022 -$ 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 2,695,000$ 204,350$ 2,899,350$
GO Bonds, Series 2016A
161
2017A G.O. BOND SUB-FUND (321-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The 2017A G.O. Improvement and Abatement Bonds financed improvements to rural outlying
roads and various other city street projects. Additionally, the issue provided funding for Fallon
Avenue overpass right-of-way acquisition, engineering, and construction. The bonds have an
average interest rate of 2.443% and are redeemable in December of 2026.
OBJECTIVES:
1. Make scheduled debt payments in a timely manner.
2. Redeem or refund when feasible.
ISSUES:
1. Balancing the property tax levy for this bond with the needs of other debt.
2. Accumulating resources for early redemption.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2019 2020 2021 2022
Assessment balance $262,955 $226,644 $191,502 $159,585
Deferred assessments $0 $0 $0 $0
Deferred % of balance 0% 0% 0% 0%
Delinquent balance $0 $0 $0 $0
Prepaid assessments $77,483 $3,442 $2,763 $0
Assessment rolls 2 2 2 2
Assessed parcels 59 57 57 56
2017A G.O. Bonds 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 429,782$ 427,367$ 430,097$ 430,097$ 427,367$ -0.6%
Special Assessments 137,796 47,347 42,577 46,859 41,120 -3.4%
Miscellaneous 10,322 6,141 1,326 (1,787) 1,513 14.1%
TOTAL REVENUES 577,900$ 480,855$ 474,000$ 475,169$ 470,000$ -0.8%
EXPENDITURES
Other Services & Charges -$ 196$ -$ 357$ 200$ ---
Debt Service 472,286 470,731 473,000 472,390 470,800 -0.5%
TOTAL EXPENDITURES 472,286$ 470,927$ 473,000$ 472,747$ 471,000$ -0.4%
FUND BALANCE - JANUARY 1 163,015$ 268,629$ 278,557$ 278,557$ 280,979$
Excess (Deficiency) of
Revenues over Expenditures 105,614 9,928 1,000 2,422 (1,000)
FUND BALANCE - DECEMBER 31 268,629$ 278,557$ 279,557$ 280,979$ 279,979$
162
BUDGET COMMENTARY:
The $5,000,000 2017A G.O. bond issue has two components: $2,040,000 improvement portion
and $2,960,000 abatement portion. Property taxes and assessments support the improvement
portion of the debt issue. The abatement portion is supported by an abatement tax levy for
bond principal and a debt service levy for bond interest. Property taxes will be levied for any
gap between assessment revenue and debt service.
REMAINING DEBT SERVICE:
Payable Principal Interes t Rate Total
6/15/2022 -$ 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 3,545,000$ 484,520$ 4,029,520$
GO Bonds, Series 2017A
163
2018A G.O. ABATEMENT BOND SUB-FUND (322-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
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:
BUDGET COMMENTARY:
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.
Measurement 2019 2020 2021 2022
Not Applicable
2018A G.O. Bonds 2019 2020 2021 2021 2022 %
REVEN UES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes $500,000 $472,434 $448,077 $448,077 $451,812 0.8%
Miscellaneous 3,027 1,817 923 (648) 1,188 28.7%
TOTAL REVENUES $503,027 $474,251 $449,000 $447,429 $453,000 0.9%
EXPENDITURES
Other Services & Charges - 196 - 357 200 ---
Debt Service 451,011 451,379 447,000 446,288 447,800 0.2%
TOTAL EXPENDITURES 451,011$ 451,575$ 447,000$ 446,645$ 448,000$ 0.2%
FUND BALANCE - JANUARY 1 5,027$ 57,043$ 79,719$ 79,719$ 80,503$
Excess (Deficiency) of
Revenues over Expenditures 52,016 22,676 2,000 784 5,000
FUND BALANCE - DECEMBER 31 57,043$ 79,719$ 81,719$ 80,503$ 85,503$
164
REMAINING DEBT SERVICE:
Payable Principal Interest Rate Total
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 4,110,000$ 810,150$ 4,920,150$
GO Bonds, Series 2018A Abatement Bonds
165
2019A G.O. BOND SUB-FUND (323-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The 2019A bonds financed the completion of the Fallon Avenue overpass, 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:
Measurement 2019 2020 2021 2022
Assessment balance $92,070 $81,840 $71,610 $61,380
Deferred assessments $0 $0 $0 $0
Deferred % of balance 0% 0% 0% 0%
Delinquent balance $0 $0 $0 $0
Prepaid assessments $0 $0 $0 $0
Assessment rolls 1 1 1 1
Assessed parcels 9 9 9 9
2019A GO BONDS 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes -$ 728,620$ 714,945$ 714,945$ 709,446$ -0.8%
Special Assessments - 14,833 14,322 14,322 13,810 -3.6%
Miscellaneous 11 912 733 (536) 744 1.5%
Operating Transfers In 5,000 - - - - ---
TOTAL REVENUES 5,011$ 744,365$ 730,000$ 728,731$ 724,000$ -0.8%
EXPENDITURES
Other Services & Charges -$ 196$ -$ 4,357$ 200$ ---
Debt Service - 709,686 715,000 714,088 718,800 0.5%
TOTAL EXPENDITURES -$ 709,882$ 715,000$ 718,445$ 719,000$ 0.6%
FUND BALANCE - JANUARY 1 -$ 5,011$ 39,494$ 39,494$ 49,780$
Excess (Deficiency) of
Revenues over Expenditures 5,011 34,483 15,000 10,286 5,000
FUND BALANCE - DECEMBER 31 5,011$ 39,494$ 54,494$ 49,780$ 54,780$
166
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 $320,000 street improvement. The revenue sources include a
combination of existing city funds, property taxes, and special assessments.
REMAINING DEBT SERVICE:
Payable Principal Interest Rate Total
6/15/2022 -$ 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 6,935,000$ 951,458$ 7,886,458$
GO Bonds, Series 2019A
167
2020A G.O. BOND SUB-FUND (324-47000)
DEPARTMENT: Debt Service SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The 2020A bonds financed the 2020 Street Improvement project. Excess proceeds are available
to use on the 2022 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.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2019 2020 2021 2022
Assessment balance - $508,813 $435,493 $387,104
Deferred assessments -$0 $0 $0
Deferred % of balance -0% 0% 0%
Delinquent balance -$0 $0 $0
Prepaid assessments -$124,520 $22,831 $0
Assessment rolls -1 1 1
Assessed parcels -251 251 238
2020A GO BONDS 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes -$ -$ 117,586$ 117,586$ 123,196$ 4.8%
Special Assessments - 124,520 68,554 92,491 66,966 -2.3%
Miscellaneous - 414 860 (836) 838 -2.6%
TOTAL REVENUES -$ 124,934$ 187,000$ 209,241$ 191,000$ 2.1%
EXPENDITURES
Other Services & Charges -$ -$ -$ 357$ 200$ ---
Debt Service - - 236,000 234,982 237,800 0.8%
TOTAL EXPENDITURES -$ -$ 236,000$ 235,339$ 238,000$ 0.8%
FUND BALANCE - JANUARY 1 -$ -$ 124,934$ 124,934$ 98,836$
Excess (Deficiency) of
Revenues over Expenditures - 124,934 (49,000) (26,098) (47,000)
FUND BALANCE - DECEMBER 31 -$ 124,934$ 75,934$ 98,836$ 51,836$
168
BUDGET COMMENTARY:
The city issued the $2,155,000 2020A G.O. Bonds to finance the 2020 Street Improvement
project. Property taxes and special assessments also support debt service payments.
Expenditures consist of debt principal and interest payments and fiscal agent fees.
REMAINING DEBT SERVICE:
Payable Principal Interes t Rate Total
6/15/2022 -$ 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 1,965,000$ 147,920$ 2,112,920$
GO Bonds, Series 2020A
169
CLOSED DEBT SERVICE FUNDS
CLOSED FUNDS PRESENTED:
• 2010A G.O. Improvement Bond Sub-Fund (317-47000)
• 2014A G.O. Judgement Bond Sub-Fund (318-47000)
CLOSED FUNDS BUDGETS:
2010A GO IMPROVEMENT BOND 2019 2020 2021 2021 2022 %
REVEN UES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Special Assessments 36,136$ -$ -$ -$ -$ ---
Miscellaneous (8,455) - - - - ---
Operating Transfers In 135,000 - - - - ---
TOTAL REVENUES 162,681$ -$ -$ -$ -$ ---
EXPENDITURES
Debt Service 881,424$ -$ -$ -$ -$ ---
Operating Transfers Out 75,000 - - - - ---
TOTAL EXPENDITURES 956,424$ -$ -$ -$ -$ ---
FUND BALANCE - JANUARY 1 793,743$ -$ -$ -$ -$
Excess (Deficiency) of
Revenues over Expenditures (793,743) - - - -
FUND BALANCE - DECEMBER 31 -$ -$ -$ -$ -$
2014A G.O. JUDGMENT BONDS 2019 2020 2021 2021 2022 %
REVEN UES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 537,244$ 535,501$ 513,570$ 513,570$ -$ -100.0%
Miscellaneous 5,915 3,163 1,430 - - -100.0%
Operating Transfers In - - - 3,776,537 - ---
TOTAL REVENUES 543,159$ 538,664$ 515,000$ 4,290,107$ -$ -100.0%
EXPENDITURES
Other Services & Charges -$ 196$ -$ 1,350$ -$ ---
Debt Service 512,357 511,442 513,000 4,437,471 - -100.0%
TOTAL EXPENDITURES 512,357$ 511,638$ 513,000$ 4,438,821$ -$ -100.0%
FUND BALANCE - JANUARY 1 90,886$ 121,688$ 148,714$ 148,714$ -$
Excess (Deficiency) of
Revenues over Expenditures 30,802 27,026 2,000 (148,714) -
FUND BALANCE - DECEMBER 31 121,688$ 148,714$ 150,714$ -$ -$
170
2022 ADOPTED BUDGETCapital 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 PROJECTS FUNDS 2019 2020 2021 2021 2022 %
REVEN UES ACTUAL ACTUAL BUDGET PROJ ECTED BUDGET CHANGE
Property Taxes 707,660$ 350,604$ 578,221$ 647,085$ 1,081,600$ 87.1%
Franchise & Other Taxes $221,934 $224,030 $110,000 $189,460 $140,000 27.3%
Intergovernmental Revenues 465,634 675,751 2,100,000 2,571,685 900,000 -57.1%
Charges for Services 12,000 - - 23,492 - ---
Special Assessments 338,542 162,789 205,575 1,193,133 207,671 1.0%
Miscellaneous 541,957 434,396 102,204 6,116 261,729 156.1%
Contributed Capital 159,779 333,550 - 271,840 - ---
Operating Transfers In 5,558,040 2,135,000 1,094,000 3,201,427 111,000 -89.9%
Debt Proceeds 8,131,662 2,256,280 - - - ---
TOTAL REVENUES 16,137,208$ 6,572,400$ 4,190,000$ 8,104,238$ 2,702,000$ -35.5%
EXPENDITURES
Other Services & Charges 281,972$ 66,888$ -$ 100,813$ -$ ---
Capital Outlay 7,484,899 4,476,428 2,440,000 4,243,249 7,290,000 198.8%
Debt Service 138,350 53,475 - - - ---
Operating Transfers Out 1,566,818 - 1,854,000 7,326,622 - -100.0%
TOTAL EXPENDITURES 9,472,039$ 4,596,791$ 4,294,000$ 11,670,685$ 7,290,000$ 69.8%
FUND BALANCE - JANUARY 1 11,896,847$ 18,562,016$ 20,537,625$ 20,537,625$ 16,971,178$
Excess (Deficiency) of
Revenues over Expenditures 6,665,169 1,975,609 (104,000) (3,566,447) (4,588,000)
FUND BALANCE - DECEMBER 31 18,562,016$ 20,537,625$ 20,433,625$ 16,971,178$ 12,383,178$
171
CAPITAL PROJECT FUND (400-4xxxx)
DEPARTMENT: Capital Project Fund SUPERVISOR: City Engineer/Public Works Director
ACTIVITY SCOPE:
The Capital Project Fund is a generic fund of the same type used to account for capital asset
construction and acquisitions. Capital assets accounted for in this fund include street
improvements 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) that the
Central Equipment internal service fund cannot.
ISSUES:
1. Funding growth and replacement improvements in a stable debt and property tax levy
environment.
MEASURABLE WORKLOAD DATA:
BUDGET:
Measurement 2019 2020 2021 2022
Projects supported 8 4 5 8
CAPITAL PROJECT FUND 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Property Taxes 707,660$ 350,604$ 578,221$ 647,085$ 1,081,600$ 87.1%
Franchise & Other Taxes 56,011 33,694 20,000 - - -100.0%
Intergovernmental Revenues 465,634 675,751 2,100,000 2,571,685 900,000 -57.1%
Charges for Services 12,000 - - 23,492 - ---
Special Assessments 225,492 58,039 54,755 434,746 205,575 275.4%
Miscellaneous 302,240 316,439 40,024 26,088 248,825 521.7%
Contributed Capital - 333,550 - 271,840 - ---
Operating Transfers In 3,383,040 1,900,000 - 2,088,430 111,000 ---
Debt Proceeds 8,131,662 2,256,280 - - - ---
TOTAL REVENUES 13,283,739$ 5,924,357$ 2,793,000$ 6,063,366$ 2,547,000$ -8.8%
EXPENDITURES
Other Services & Charges 82,352$ 66,888$ -$ 100,813$ -$ ---
Capital Outlay 5,563,185 3,969,151 1,590,000 3,537,063 6,490,000 308.2%
Debt Service 138,350 53,475 - - - ---
Operating Transfers Out 5,000 - 200,000 3,976,538 - -100.0%
TOTAL EXPENDITURES 5,788,887$ 4,089,514$ 1,790,000$ 7,614,415$ 6,490,000$ 262.6%
FUND BALANCE - JANUARY 1 6,913,851$ 14,408,703$ 16,243,546$ 16,243,546$ 14,692,497$
Excess (Deficiency) of
Revenues over Expenditures 7,494,852 1,834,843 1,003,000 (1,551,049) (3,943,000)
FUND BALANCE - DECEMBER 31 14,408,703$ 16,243,546$ 17,246,546$ 14,692,497$ 10,749,497$
172
BUDGET COMMENTARY:
Intergovernmental revenues of $2.1 million were received in 2021 but are related to the Fallon
Avenue Overpass project that was completed in 2018. The 2021 payoff of the Judgment portion
of the 2014A bonds created capacity for the capital projects fund to levy about $500,000 more
than it previously could in previous years. The 2022 property tax levy reduces the need for
future debt and stabilizes the overall levy to accommodate future debt. The 2021 transfer in is
from the closure of the Closed Bond fund. The Closed Bond fund tracked excess fund balance
available after bonds were paid off, but the fund was presented in conjunction with the Capital
Projects fund, so the city formally combined them in 2021.
For 2022, notable projects include: Planning for a new public works facility - $500,000; 2022
Streets & Sidewalk Improvements project - $1,700,000; Planning and Grading work for the
Pointes at Cedar development area - $2,700,000; replacement engine for the fire department -
$725,000. Some funding is budgeted to come from fund balance.
173
STREET LIGHTING IMPROVEMENT FUND (403-43162)
DEPARTMENT: Public Works SUPERVISOR: City Engineer/Public Works Director
ACTIVITY SCOPE:
The Street Lighting Improvement Fund provides resources for improvements to the street
lighting system. Electric franchise fees are the fund’s primary revenue sources.
OBJECTIVES:
1. Upgrade traditional lights to colonial style lights.
2. Collaborate with MNDOT to add battery back-up to signals on TH25.
3. Replace and modify lighting system in the downtown area.
4. Add lighting for pathways and other high use areas.
ISSUES:
1. Project scope and timing.
2. Develop a light replacement program with Wright Hennepin and Xcel Energy.
3. Verify lamp and fixture maintenance by utility companies.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
Electric franchise fees provide resources for lighting projects, often in conjunction with other
street improvement projects. Capital outlays budgeted in 2022 include $425,000 for street re-
lighting projects including School Boulevard and Fenning Avenue.
Measurement 2019 2020 2021 2022
Projects supported 2 0 0 1
STREET LIGHT IMPROVEMENTS 2019 2020 2021 2021 2022 %
REVEN UES ACTUAL ACTUAL BUDGET PROJ ECTED BUDGET CHANGE
Franchise & Other Taxes 165,923$ 190,336$ 90,000$ 189,460$ 140,000$ 55.6%
Miscellaneous 23,783 17,709 10,000 (5,181) 10,000 0.0%
TOTAL REVENUES 189,706$ 208,045$ 100,000$ 184,279$ 150,000$ 50.0%
EXPENDITURES
Capital Outlay 3,787$ 621$ 100,000$ -$ 425,000$ 325.0%
TOTAL EXPENDITURES 3,787$ 621$ 100,000$ -$ 425,000$ 325.0%
FUND BALANCE - JANUARY 1 602,585$ 788,504$ 995,928$ 995,928$ 1,180,207$
Excess (Deficiency) of
Revenues over Expenditures 185,919 207,424 - 184,279 (275,000)
FUND BALANCE - DECEMBER 31 788,504$ 995,928$ 995,928$ 1,180,207$ 905,207$
174
PARK & PATHWAY IMPROVEMENT FUND (404-45202)
DEPARTMENT: Recreation & Culture SUPERVISOR: Parks Superintendent
ACTIVITY SCOPE:
Activities of the Park and Pathway Improvement Fund include updating and maintaining the
city's pathway system.
OBJECTIVES:
1. Improve pathways and parks systems.
2. Development of Bertram Chain of Lakes Park.
ISSUES:
1. Time constraints of other projects.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
Transfers from other funds typically surpass all other revenue sources. When possible, the city
transfers money into this fund prior to the year of expenditure.
2019 transfers in were from the Liquor Fund for construction of phase 1 at the Bertram Chain of
Lakes (BCOL) Regional Park. 2021 transfers were due to the closure of the unused Streets
Reconstruction Fund. The 2022 budgeted expenditure is related to trail improvements on
School Boulevard from Fenning Avenue to the Cardinal Hills development.
Measurement 2019 2020 2021 2022
Projects supported 4 4 2 1
PARK & PATHWAY IMPROVEMENT 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Miscellaneous 88,819$ 48,760$ 47,000$ (14,832)$ 2,000$ -95.7%
Operating Transfers In 2,100,000 235,000 1,094,000 1,094,000 - -100.0%
TOTAL REVENUES 2,188,819$ 283,760$ 1,141,000$ 1,079,168$ 2,000$ -99.8%
EXPENDITURES
Other Services & Charges 28,016$ -$ -$ -$ -$ ---
Capital Outlay 1,917,927 506,656 750,000 678,183 375,000 -50.0%
Operating Transfers Out - - - 18,997 - ---
TOTAL EXPENDITURES 1,945,943$ 506,656$ 750,000$ 697,180$ 375,000$ -50.0%
FUND BALANCE - JANUARY 1 696,465$ 939,341$ 716,445$ 716,445$ 1,098,433$
Excess (Deficiency) of
Revenues over Expenditures 242,876 (222,896) 391,000 381,988 (373,000)
FUND BALANCE - DECEMBER 31 939,341$ 716,445$ 1,107,445$ 1,098,433$ 725,433$
175
PARK DEDICATION FUND (405-45202)
DEPARTMENT: Public Works SUPERVISOR: Community Development Director
ACTIVITY SCOPE:
The Park Dedication Fund is used to account for funds charged to developers for future city
park areas.
OBJECTIVES:
1. Provide quality park area within walkable distance to all residential parcels in the
City.
ISSUES:
1. Economic impact on new development and home construction.
MEASURABLE WORKLOAD DATA:
BUDGET:
BUDGET COMMENTARY:
The Park Dedication Fund was created in 2021 to properly account for restricted park
dedication fees received from developers for the construction of park areas within new
developments. Park dedication fees are an irregular source of revenue because of
unpredictable economic conditions and sporadic new development.
Measurement 2019 2020 2021 2022
Acres deeded to city 3.45 1.96 0.00 2.00
Fees collected*-$ -$ -$ 200,000$
*Land may be donated by developer in lieu of paying a park dedication fee.
PARK DEDICATION 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Special Assessments -$ -$ -$ 9,006$ 2,096$ ---
Miscellaneous - - - 41 904 ---
Operating Transfers In - - - 18,997 - ---
TOTAL REVENUES -$ -$ -$ 28,044$ 3,000$ ---
EXPENDITURES
Capital Outlay -$ -$ -$ 28,003$ -$ ---
TOTAL EXPENDITURES -$ -$ -$ 28,003$ -$ ---
FUND BALANCE - JANUARY 1 -$ -$ -$ -$ 41$
Excess (Deficiency) of
Revenues over Expenditures - - - 41 3,000
FUND BALANCE - DECEMBER 31 -$ -$ -$ 41$ 3,041$
176
CLOSED CAPITAL PROJECTS FUNDS
CLOSED FUNDS PRESENTED:
• Closed Bond Fund (402-00000)
• Stormwater Access Fund (263-43150)
• Streets Reconstruction Fund (212-43121)
CLOSED FUNDS BUDGETS:
CLOSED BOND FUND 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Special Assessments 77,974$ 104,750$ 150,820$ 749,381$ -$ -100.0%
Miscellaneous 25,075 17,602 5,180 - - -100.0%
Operating Transfers In 75,000 - - - - ---
TOTAL REVENUES 178,049$ 122,352$ 156,000$ 749,381$ -$ -100.0%
Operating Transfers Out -$ -$ -$ 1,663,431$ -$ ---
TOTAL EXPENDITURES -$ -$ -$ 1,663,431$ -$ ---
FUND BALANCE - JANUARY 1 613,649$ 791,698$ 914,050$ 914,050$ -$
Excess (Deficiency) of
Revenues over Expenditures 178,049 122,352 156,000 (914,050) -
FUND BALANCE - DECEMBER 31 791,698$ 914,050$ 1,070,050$ -$ -$
STORMWATER ACCESS FUND 2019 2020 2021 2021 2022 %
REVEN UES ACTUAL ACTUAL BUDGET PROJ ECTED BUDGET CHANGE
Special Assessments 35,076$ -$ -$ -$ -$ ---
Miscellaneous 44,631 - - - - ---
TOTAL REVENUES 239,486$ -$ -$ -$ -$ ---
EXPENDITURES
Other Services & Charges 171,604$ -$ -$ -$ -$ ---
Operating Transfers Out 1,426,818 - - - - ---
TOTAL EXPENDITURES 1,598,422$ -$ -$ -$ -$ ---
FUND BALANCE - JANUARY 1 1,358,936$ -$ -$ -$ -$
Excess (Deficiency) of
Revenues over Expenditures (1,358,936) - - - -
FUND BALANCE - DECEMBER 31 -$ -$ -$ -$ -$
STREET RECONSTRUCTION FUND 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Miscellaneous 57,409$ 33,886$ -$ -$ -$ ---
EXPENDITURES
Operating Transfers Out 135,000$ -$ 1,654,000$ 1,667,657$ -$ -100.0%
FUND BALANCE - JANUARY 1 1,711,361$ 1,633,770$ 1,667,656$ 1,667,656$ -$
Excess (Deficiency) of
Revenues over Expenditures (77,591) 33,886 (1,654,000) (1,667,656) -
FUND BALANCE - DECEMBER 31 1,633,770$ 1,667,656$ 13,656$ -$ -$
177
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178
2022 ADOPTED BUDGETEnterprise Funds
ENTERPRISE FUNDS - SUMMARY
DESCRIPTION
Enterprise funds are used to report an activity for which a fee is charged to external users for
goods or services. Unlike governmental funds, enterprise funds focus on the determination of
operating income, changes in net position (or cost recovery), financial position, and cash flows.
Enterprise funds use an accrual basis of accounting for financial reporting purposes. A modified
accrual basis will be used for budgeting purposes in this report. Consequently, the bottom line
for each enterprise fund is labeled fund balance rather than net position, which includes capital
assets, long-term debt, and other noncurrent items. Fund balance in enterprise funds is roughly
the same as working capital. The city currently has six active enterprise funds: Water, Sewer,
Stormwater, Liquor (Hi-Way Liquors), Deputy Registrar (DMV), and Fiber Optics (FiberNet).
BUDGET ISSUES
Each enterprise fund has specific challenges that will be addressed in the narrative for each
fund.
BUDGET SUMMARY
TOTAL ENTERPRISE FUNDS 2019 2020 2021 2021 2022 %
REVEN UES ACTUAL ACTUAL BUDGET PROJ ECTED BUDGET CHANGE
Sale of Goods 6,374,153$ 7,404,955$ 6,679,000$ 7,104,357$ 7,013,000$ 5.0%
Licenses & Permits 3,255 3,095 2,000 5,350 2,000 0.0%
Intergovernmental Revenues - - - 95,601 - ---
Charges for Services 7,309,141 7,986,117 7,329,000 8,717,242 7,634,757 4.2%
Special Assessments 38,590 14,179 38,000 98,695 38,000 0.0%
Miscellaneous 690,075 296,319 96,000 (30,098) 135,243 40.9%
Contributed Capital 645,580 809,394 75,000 664,726 75,000 0.0%
Operating Transfers In 1,426,818 - 200,000 200,000 - -100.0%
TOTAL REVENUES 16,487,612$ 16,514,059$ 14,419,000$ 16,909,815$ 14,898,000$ 3.3%
EXPENDITURES
Personnel Services 1,663,246$ 1,831,339$ 2,027,951$ 2,085,806$ 2,278,593$ 12.4%
Supplies 5,090,456 5,856,726 5,449,799 5,592,137 5,699,100 4.6%
Other Services & Charges 3,668,174 3,370,925 3,697,624 3,565,142 3,942,490 6.6%
Capital Outlay 98,214 - 3,738,000 321,289 3,237,500 -13.4%
Debt Service 364,106 70,257 366,626 64,371 361,317 -1.4%
Operating Transfers Out 4,233,000 1,560,000 325,000 - - -100.0%
TOTAL EXPENDITURES 15,117,196$ 12,689,247$ 15,605,000$ 11,628,746$ 15,519,000$ -0.6%
FUND BALANCE - JANUARY 1 12,920,435$ 14,290,851$ 18,115,663$ 18,115,663$ 23,396,732$
Excess (Deficiency) of
Revenues over Expenditures 1,370,416 3,824,812 (1,186,000) 5,281,069 (621,000)
FUND BALANCE - DECEMBER 31 14,290,851$ 18,115,663$ 16,929,663$ 23,396,732$ 22,775,732$
179
WATER FUND (601-4944x)
DEPARTMENT: Public Works SUPERVISOR: Utilities Superintendent
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 2019 2020 2021 2022
Water customers 4,396 4,458 4,547 4,600
Meters read 52,752 53,496 54,564 55,200
Meters replaced 45 52 58 50
New meters installed 43 62 100 50
Water locates 2,404 2,018 2,289 2,500
Gallons pumped (MG)512 601 674 550
Valves maintained 447 120 533 202
Hydrants maintained 428 153 216 175
Times mains flushed 2 2 2 2
Mains/wells rebuilt 0 2 0 2
Water towers inspections 2 1 2 2
Reservoir inspections 0 1 1 1
Water samples to sent 186 190 191 190
Radio units installed 368 125 197 500
Service shut-offs 43 25 30 100
180
BUDGET:
BUDGET COMMENTARY:
The Water Fund’s main source of revenue is user charges. Rates increase 5% for the base
charge and usage charges in 2022.
Capital outlays in 2022 are for completion of a SCADA system upgrade. The 2022 personnel
services budget includes a full step increase and a 3.0% market rate wage adjustment.
However, an updated allocation of utilities staff time leads to a decrease in wages in the Water
Fund. Other services & charges increase due to additional engineering services and anticipated
repairs and maintenance needed on equipment. The 2019-2020 transfers out were used in
2021 to acquire land for a new public works facility site.
WATER FUND 2019 2020 2021 2021 2022 %
REVEN UES ACTUAL ACTUAL BUDGET PROJ ECTED BUDGET CHANGE
Licenses & Permits 3,255$ 3,095$ 2,000$ 5,350$ 2,000$ 0.0%
Intergovernmental Revenues - - - 17,491 - ---
Charges for Services 1,326,411 1,750,503 1,489,500 1,815,365 1,559,049 4.7%
Special Assessments 27,370 13,960 38,000 37,421 38,000 0.0%
Miscellaneous 220,632 141,264 55,500 37,752 55,951 0.8%
Contributed Capital 333,327 34,602 15,000 78,430 15,000 0.0%
TOTAL REVENUES 1,910,995$ 1,943,424$ 1,600,000$ 1,991,810$ 1,670,000$ 4.4%
EXPENDITURES
Personnel Services 269,252$ 250,345$ 372,229$ 275,291$ 357,798$ -3.9%
Supplies 153,007 104,801 221,650 130,598 224,150 1.1%
Other Services & Charges 267,713 339,048 491,121 377,896 513,052 4.5%
Capital Outlay 98,214 - 850,000 160,645 650,000 -23.5%
Operating Transfers Out 1,533,000 900,000 - - - ---
TOTAL EXPENDITURES 2,321,186$ 1,594,194$ 1,935,000$ 944,430$ 1,745,000$ -9.8%
FUND BALANCE - JANUARY 1 5,341,438$ 4,931,247$ 5,280,477$ 5,280,477$ 6,327,857$
Excess (Deficiency) of
Revenues over Expenditures (410,191) 349,230 (335,000) 1,047,380 (75,000)
FUND BALANCE - DECEMBER 31 4,931,247$ 5,280,477$ 4,945,477$ 6,327,857$ 6,252,857$
181
SEWER FUND (602-49480 & 602-4949x)
DEPARTMENT: Public Works SUPERVISOR: Utilities Superintendent
ACTIVITY SCOPE:
The Sewer Fund is a self-sustaining city utility fund. The Sewer Fund has three divisions:
sanitary sewer administration, sanitary sewer collection operations and treatment plant
operations. The water department manages the sanitary sewer system, and a private vendor
provides treatment plant services.
OBJECTIVES:
1. 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 2019 2020 2021 2022
Collection
Sewer mains maintained 25 Miles 28 Miles 21 Miles 28 Miles
Liftstations 7 7 7 7
Sewer main locates 2,404 2,018 2,289 2,500
Manholes maintained*728 344 385 400
New service hookups 42 62 105 50
Treatment
Screw press influent flow (gals)6,596,750 5,778,250 7,226,500 6,500,000
Thickened sludge (wet tons)2,145 2,072 2,207 2,100
Thickened sludge (dry tons)336 314 336 325
Dry ton % of wet ton 15.7% 15.2% 15.2% 15.5%
Raw influent flow (million gals)473 446 482 450
* Manholes are maintained by quadrants. Fewer manholes in one quadrant allows
more time for cleaning longer main sewer lines.
182
BUDGET:
BUDGET COMMENTARY:
The Sewer Fund’s main source of revenue is user charges. Rates increase 5% for the base
charge and usage charges in 2022. Operating transfers in were budgeted in 2021 to the sewer
access charges sub-fund to replenish use of charges for debt service in prior years.
The 2022 personnel services budget includes a full step increase and a 3.0% market rate wage
adjustment. Additionally, an updated allocation of utilities staff time leads to an increase in
wages in the Sewer Fund. 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 2022 include $800,000 for completion of a SCADA upgrade and $375,000 for sewer
line improvements and maintenance.
SEWER FUND 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Intergovernmental Revenues -$ -$ -$ 38,978$ -$ ---
Charges for Services 3,338,788 3,346,053 2,890,000 3,658,444 3,020,000 4.5%
Special Assessments 11,220 219 - 39,124 - ---
Miscellaneous 179,948 74,575 30,000 (37,569) 30,000 0.0%
Contributed Capital 312,253 84,521 - 257,766 - ---
Operating Transfers In - - 200,000 200,000 - -100.0%
TOTAL REVENUES 3,842,209$ 3,505,368$ 3,120,000$ 4,156,742$ 3,050,000$ -2.2%
EXPENDITURES
Personnel Services 358,413$ 354,812$ 384,021$ 433,294$ 383,531$ -0.1%
Supplies 127,552 154,593 173,500 151,227 176,000 1.4%
Other Services & Charges 1,187,303 1,153,829 1,274,853 1,245,362 1,338,152 5.0%
Capital Outlay - - 1,680,000 160,645 1,217,000 -27.6%
Debt Service 364,106 70,257 366,626 64,371 361,317 -1.4%
Operating Transfers Out 600,000 - - - - ---
TOTAL EXPENDITURES 2,637,374$ 1,733,491$ 3,879,000$ 2,054,899$ 3,476,000$ -10.4%
FUND BALANCE - JANUARY 1 4,308,695$ 5,513,530$ 7,285,407$ 7,285,407$ 9,387,251$
Excess (Deficiency) of
Revenues over Expenditures 1,204,835 1,771,877 (759,000) 2,101,844 (426,000)
FUND BALANCE - DECEMBER 31 5,513,530$ 7,285,407$ 6,526,407$ 9,387,251$ 8,961,251$
183
REMAINING DEBT SERVICE:
Payable Principal Interest Rate Total Payable Principal Interest Rate Total
6/1/2022 -$ 22,203$ 22,203$ 2/20/2022 -$ 8,456$ 8,456$
12/1/2022 200,000 22,203 2.35% 222,203 8/20/2022 106,000 8,456 1.06% 114,456
6/1/2023 - 19,853 19,853 2/20/2023 - 7,893 7,893
12/1/2023 205,000 19,853 2.60% 224,853 8/20/2023 107,000 7,893 1.06% 114,893
6/1/2024 - 17,188 17,188 2/20/2024 - 7,324 7,324
12/1/2024 210,000 17,188 2.75% 227,188 8/20/2024 108,000 7,324 1.06% 115,324
6/1/2025 - 14,300 14,300 2/20/2025 - 6,750 6,750
12/1/2025 215,000 14,300 3.00% 229,300 8/20/2025 109,000 6,750 1.06% 115,750
6/1/2026 - 11,075 11,075 2/20/2026 - 6,171 6,171
12/1/2026 225,000 11,075 3.00% 236,075 8/20/2026 111,000 6,171 1.06% 117,171
6/1/2027 - 7,700 7,700 2/20/2027 - 5,581 5,581
12/1/2027 230,000 7,700 3.20% 237,700 8/20/2027 112,000 5,581 1.06% 117,581
6/1/2028 - 4,020 4,020 2/20/2028 - 4,985 4,985
12/1/2028 240,000 4,020 3.35% 244,020 8/20/2028 113,000 4,985 1.06% 117,985
Total 1,525,000$ 192,675$ 1,717,675$ 2/20/2029 - 4,385 4,385
*Original redemption date was December 1, 2021.8/20/2029 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 1,591,000$ 129,782$ 1,720,782$
MPFA-15-0004-R-FY16GO Wastewater Treatment Bonds, Series 2013B
184
CONTRACTED WASTEWATER TREATMENT PLANT SERVICES:
The city started directly paying for chemicals (polymer) in 2018. Electricity and gas charges
were assumed by the city in 2016 and are not reported above as a contract cost. The waste
disposal biosolids site was abandoned in 2014 when the new screw press technology was
installed.
Year Service Change $ Change %
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 563,394$ (29,802)$ -5.0%
2019 577,476$ 14,082$ 2.5%
2020 591,913$ 14,437$ 2.5%
2021 606,711$ 14,798$ 2.5%
2022 621,882$ 15,171$ 2.5%
Schedule of Non-Reimbursables (O&M Services)
$-
$100
$200
$300
$400
$500
$600
$700
2013201420152016201720182019202020212022ThousandsO&M Services Costs
Year R&M Polymer Hauling Landfill Electricity Gas Total
2013 89,620$ 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 56,583 - 28,842 67,993 - - 153,418
2021* 55,500 - 37,200 51,300 - - 144,000
2022* 55,500 - 37,200 51,300 - - 144,000
*Budgeted
Schedule of Reimbursable Costs
$-
$100
$200
$300
$400
2013 2014 2015 2016 2017 2018 2019 2020 2021*2022*ThousandsReimbursable Costs 2013-2022
R&M Polymer Hauling Landfill Electricity Gas
185
STORMWATER FUND (652-4948x)
DEPARTMENT: Public Works SUPERVISOR: Utilities Superintendent
ACTIVITY SCOPE:
The Stormwater Fund, 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.
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:
Measurement 2019* 2020 2021 2022
Stormwater main miles 72.5 73.0 73.5 74.0
Number of manholes 1,645 1,655 1,631 1,640
Number of ponds 107 109 112 113
Number of outfalls 31 31 29 29
Number of stormwater BMPs**49 50 50 53
Gopher 1 utility locates 2,404 2,018 2,100 2,100
*2019 activity was accounted for in the General Fund.
**BMPs = best managemet practices
186
BUDGET:
BUDGET COMMENTARY:
The Stormwater Fund’s main source of revenue is user charges in the form of a stormwater fee,
which is based on 1 drainage unit per residence and 7 drainage units per impervious acre for
non-residential properties. The fee was established in July 2019. The fee increases from $3 to
$4 per drainage unit per month for 2022.
Personnel services consists of wages previously allocated to the streets and engineering
departments. Other services & charges include engineering fees and licenses & permits. Capital
outlay consists of expenditures for stormwater improvements.
STORMWATER FUND 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Intergovernmental Revenues -$ -$ -$ 39,132$ -$ ---
Charges for Services 61,757 241,873 386,000 356,457 386,000 0.0%
Special Assessments - - - 22,150 - ---
Miscellaneous 372 2,030 2,000 (7,722) 2,000 0.0%
Contributed Capital - 690,271 60,000 328,530 60,000 0.0%
Operating Transfers In 1,426,818 - - - - ---
TOTAL REVENUES 1,488,947$ 934,174$ 448,000$ 738,547$ 448,000$ 0.0%
EXPENDITURES
Personnel Services -$ 127,167$ 107,055$ 157,307$ 143,044$ 33.6%
Supplies - 641 21,000 418 21,000 0.0%
Other Services & Charges - 10,468 29,945 65,470 40,956 36.8%
Capital Outlay - - 700,000 - 1,177,000 68.1%
TOTAL EXPENDITURES -$ 138,276$ 858,000$ 223,195$ 1,382,000$ 61.1%
FUND BALANCE - JANUARY 1 -$ 1,488,947$ 2,284,845$ 2,284,845$ 2,800,197$
Excess (Deficiency) of
Revenues over Expenditures 1,488,947 795,898 (410,000) 515,352 (934,000)
FUND BALANCE - DECEMBER 31 1,488,947$ 2,284,845$ 1,874,845$ 2,800,197$ 1,866,197$
187
LIQUOR FUND (609-4975x)
DEPARTMENT: Liquor Fund SUPERVISOR: Liquor Store Manager
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 in 2020 with staffing levels
and physical space of the store.
6. Decreased demand in 2021 as restrictions placed onto on-sale establishments
during the height of the pandemic were lifted.
MEASURABLE WORKLOAD DATA:
Measurement 2019 2020 2021 2022
Gross profit 1,672,955$ 1,903,732$ 1,909,014$ 1,915,000$
Gross profit % of sales 26% 26% 27% 27%
Sales per square foot $724 $842 $808 $841
Total number of sales 267,273 260,957 250,894 255,000
Staff hours worked 23,800 21,828 21,641 22,000
Sales per hour worked 11.2 12.0 11.6 11.6
Average sale (including tax)$26.19 $31.19 $31.14 $30.00
188
BUDGET:
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.
The 2019 transfers out include $2,100,000 to the Parks and Pathway Improvement Fund for
phase 1 of the Bertram Chain of Lakes (BCOL) regional park development. The 2020 projected
transfers out include $235,000 to the Parks and Pathway Improvement Fund for installation of a
turn lane on Briarwood by BCOL and $425,000 to the Community Center Fund for roof repairs
and operating shortfalls because of the COVID-19 pandemic.
The 2022 personnel services budget includes a full step increase and a 3.0% market rate wage
increase for existing staff and the addition of another full-time clerk. Budgeted revenues are
conservatively estimated.
LIQUOR FUND 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Sale of Goods 6,374,153$ 7,404,955$ 6,679,000$ 7,104,357$ 7,013,000$ 5.0%
Miscellaneous 55,889 23,827 5,000 (9,069) 12,000 140.0%
TOTAL REVENUES 6,430,042$ 7,428,782$ 6,684,000$ 7,095,288$ 7,025,000$ 5.1%
EXPENDITURES
Personnel Services 625,051$ 628,667$ 701,811$ 675,850$ 757,420$ 7.9%
Supplies 4,719,040 5,477,861 4,923,749 5,189,566 5,167,350 4.9%
Other Services & Charges 257,521 247,714 258,440 241,524 300,230 16.2%
Capital Outlay - - 50,000 - 10,000 -80.0%
Operating Transfers Out 2,100,000 660,000 325,000 - - -100.0%
TOTAL EXPENDITURES 7,701,612$ 7,014,242$ 6,259,000$ 6,106,940$ 6,235,000$ -0.4%
FUND BALANCE - JANUARY 1 1,871,630$ 600,060$ 1,014,600$ 1,014,600$ 2,002,948$
Excess (Deficiency) of
Revenues over Expenditures (1,271,570) 414,540 425,000 988,348 790,000
FUND BALANCE - DECEMBER 31 600,060$ 1,014,600$ 1,439,600$ 2,002,948$ 2,792,948$
189
DEPUTY REGISTRAR FUND (653-41990)
DEPARTMENT: Deputy Registrar (DMV) SUPERVISOR: DMV Manager
ACTIVITY SCOPE:
The Deputy Registrar (DMV) is a city-based service entity, which assists customers with the
purchase of vehicle license plates/tabs, DNR licenses, and other licenses as required by
Minnesota state agencies. The DMV is one of four limited driver’s license agents in Wright
County. A limited agent can process change of address and lost license applications for driver’s
licenses. Furthermore, the DMV facility leases space to FiberNet operations and the
Community Center.
OBJECTIVES:
1. Market DMV services to public and dealerships.
2. Expand and improve customer service.
3. Update employee training and certifications.
4. To provide a well-maintained building.
ISSUES:
1. Changes to state licensing regulations.
2. Availability/limitations of state portal for license processing (MNLARS).
3. Providing some services with little or no revenue.
4. Competition with other customer options: other DMVs, on-line, and mail-in.
5. Use of second floor by other city departments possibly impacting operations (noise
level, etc.)
MEASURABLE WORKLOAD DATA:
Measurement 2019 2020 2021 2022
Outcome/Effectiveness:
License Revenue $787,658 $800,666 $936,870 $900,000
Revenue per staff hour $48.57 $49.51 $52.06 $52.94
Net revenue per staff hour $20.53 $16.87 $20.14 $20.00
Efficiency:
Transactions per hour 8.6 7.9 5.7 8.1
Work Load:
Total transactions 139,965 127,128 101,784 138,225
129,825 115,466 88,875 125,000
DNR transactions 8,148 8,424 8,759 8,900
Game & Fish transactions 709 311 265 325
Driver's license transactions 1,283 2,927 3,885 4,000
Staff hours 16,218 16,172 17,997 17,000
Dealerships serviced 30 32 32 34
*The transition to the State's MNLARS system in mid-2019 & to the new MNDrive
system in late 2020 creates skewed transaction numbers due to the differences
in how transactions are count.
Motor vehicle transactions*
190
BUDGET:
BUDGET COMMENTARY:
The main revenue source for the DMV is the fees charged for the issuance of various licenses.
The 2022 personnel services budget includes a full step increase and a 3.0% market rate wage
adjustment. Capital outlay budgeted in 2021 was for a remodel of the first floor of the City‐
owned Prairie Center building for a new DMV location. This new location is closer to the city’s
core campus including the Monticello Community Center and City Hall, Parks facility, Library,
and Liquor Store. Revenue by service type: DNR licenses = $2‐$7; game & fish licenses = $1;
driver’s licenses = $8; motor vehicle transactions = $6‐$10. Revenues are always estimated
conservatively. The 2022 budget reflects prior year levels for utilities in the former Prairie
Center Building department in the General Fund with an increase in building maintenance costs
due to the increase usage of the building.
DEPUTY REGISTRAR 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 788,032$ 800,954$ 700,500$ 941,759$ 800,000$ 14.2%
Miscellaneous 215,693 40,622 1,500 (11,516) 25,000 1566.7%
TOTAL REVENUES 1,003,725$ 841,576$ 702,000$ 930,243$ 825,000$ 17.5%
EXPENDITURES
Personnel Services 410,286$ 466,262$ 456,535$ 541,800$ 630,525$ 38.1%
Supplies 9,936 7,109 9,900 10,977 10,600 7.1%
Other Services & Charges 46,277 47,183 53,565 46,983 89,875 67.8%
Capital Outlay - - 125,000 - - -100.0%
TOTAL EXPENDITURES 466,499$ 520,554$ 645,000$ 599,761$ 731,000$ 13.3%
FUND BALANCE - JANUARY 1 990,502$ 1,527,728$ 1,848,750$ 1,848,750$ 2,179,232$
Excess (Deficiency) of
Revenues over Expenditures 537,226 321,022 57,000 330,482 94,000
FUND BALANCE - DECEMBER 31 1,527,728$ 1,848,750$ 1,905,750$ 2,179,232$ 2,273,232$
191
FIBER OPTICS FUND (656-4987x)
DEPARTMENT: Fiber Optics Fund SUPERVISOR: City Administrator/Finance Director
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:
Measurement 2019 2020 2021 2022
Internet subscibers 1,631 1,801 1,808 1,850
Phone subscribers 354 315 297 280
Cable TV subscribers 385 323 289 265
FIBER OPTICS 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 1,794,153$ 1,846,734$ 1,863,000$ 1,945,217$ 1,869,708$ 0.4%
Miscellaneous 17,541 14,001 2,000 (1,974) 10,292 414.6%
TOTAL REVENUES 1,811,694$ 1,860,735$ 1,865,000$ 1,997,185$ 1,880,000$ 0.8%
EXPENDITURES
Personnel Services 244$ 4,086$ 6,300$ 2,264$ 6,275$ -0.4%
Supplies 80,921 111,721 100,000 109,351 100,000 0.0%
Other Services & Charges 1,909,360 1,572,683 1,589,700 1,587,906 1,660,225 4.4%
Capital Outlay - - 333,000 - 183,500 -44.9%
TOTAL EXPENDITURES 1,990,525$ 1,688,490$ 2,029,000$ 1,699,521$ 1,950,000$ -3.9%
FUND BALANCE - JANUARY 1 408,170$ 229,339$ 401,584$ 401,584$ 699,248$
Excess (Deficiency) of
Revenues over Expenditures (178,831) 172,245 (164,000) 297,664 (70,000)
FUND BALANCE - DECEMBER 31 229,339$ 401,584$ 237,584$ 699,248$ 629,248$
192
BUDGET COMMENTARY:
Revenues in the Fiber Optics Fund come from charges to subscribers, and expenditures are
incurred in operating the system. 2019 was the first year where Fibernet operations were
positive, and a transfer from the Liquor Fund was not needed.
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
2022 budget includes $183,500 in capital outlay for system improvements to new service areas.
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2022 ADOPTED BUDGETInternal Service Funds
INTERNAL SERVICE FUNDS - SUMMARY
DESCRIPTION
Internal service funds are a proprietary fund type that may be used to report any activity that provides
goods or services to other funds, departments, or agencies of the primary government and its component
units, or to other governments, on a cost-reimbursement basis. Internal service funds use an accrual basis
of accounting for financial reporting purposes. A modified accrual basis will be used for budgeting
purposes in this report. Consequently, the bottom line for each fund is labeled fund balance rather than
net position, which includes capital assets, long-term debt, and other noncurrent items. Fund balance in
an internal service fund is roughly the same as working capital. The city currently has four active internal
service funds: Facilities Maintenance, IT Services, Central Equipment, and Benefit Accrual.
BUDGET ISSUES
Each internal service fund has specific challenges that will be addressed in the narrative for each fund.
BUDGET SUMMARY
TOTAL INTERNAL SERVICE FUNDS 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 690,701$ 562,341$ 989,100$ 964,548$ 1,330,400$ 34.5%
Miscellaneous 39,208 24,969 9,900 40,774 14,600 47.5%
Contributed Capital - - - 44,955 - ---
Operating Transfers In 200,000 - 560,000 1,573,657 - -100.0%
TOTAL REVENUES 929,909$ 587,310$ 1,559,000$ 2,623,933$ 1,345,000$ -13.7%
EXPENDITURES
Personnel Services 29,841$ 6,541$ 261,772$ 89,051$ 243,848$ -6.8%
Supplies 16,147 98,905 51,700 66,767 172,420 233.5%
Other Services & Charges 126,928 235,292 225,028 296,406 283,452 26.0%
Capital Outlay 193,494 11,597 939,500 78,522 1,034,280 10.1%
Debt Service 131,477 10,168 67,000 6,658 66,000 -1.5%
TOTAL EXPENDITURES 497,887$ 362,503$ 1,545,000$ 537,404$ 1,800,000$ 16.5%
FUND BALANCE - JANUARY 1 928,158$ 1,360,180$ 1,584,987$ 1,584,987$ 3,671,517$
Excess (Deficiency) of
Revenues over Expenditures 432,022 224,807 14,000 2,086,530 (455,000)
FUND BALANCE - DECEMBER 31 1,360,180$ 1,584,987$ 1,598,987$ 3,671,517$ 3,216,517$
195
FACILITIES MAINTENANCE FUND (701-00000)
DEPARTMENT: Public Works
SUPERVISOR: Public Works Director
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:
Measurement 2019 2020 2021 2022
Buildings maintained --18 18
R&M orders --318 1,272
R&M order hours --209 834
Hours per R&M service order --0.7 0.7
Total R&M service order costs $- $- $91,704 $320,965
R&M service cost per order $- $- $288.38 $252.33
Note: The Facilities Maintenance department was created in 3rd quarter 2021.
FACILITIES MAINTENANCE 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services -$ -$ 292,000$ 160,139$ 325,000$ 11.3%
TOTAL REVENUES -$ -$ 292,000$ 160,139$ 325,000$ 11.3%
EXPENDITURES
Personnel Services -$ -$ 203,772$ 74,340$ 134,103$ -34.2%
Supplies - - 38,000 21,885 123,000 223.7%
Other Services & Charges - - 50,228 97,769 27,897 -44.5%
Capital Outlay - - - - 40,000 ---
TOTAL EXPENDITURES -$ -$ 292,000$ 193,994$ 325,000$ 11.3%
FUND BALANCE - JANUARY 1 -$ -$ -$ -$ (33,855)$
Excess (Deficiency) of
Revenues over Expenditures - - - (33,855) -
FUND BALANCE - DECEMBER 31 -$ -$ -$ (33,855)$ (33,855)$
196
BUDGET COMMENTARY:
The Facilities Maintenance Fund’s main source of revenue is internal user charges, and the fund
accounts for all activity supporting the city’s facilities, including the Community Center/City
Hall, Public Works, Fire station, Hi-Way Liquors, the DMV, FM facility, animal control facility,
and Library.
197
IT SERVICES FUND (702-00000)
DEPARTMENT: Finance
SUPERVISOR: Finance Director
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. Increasing threats to cyber security.
MEASURABLE WORKLOAD DATA:
Measurement 2019 2020 2021 2022
Work Load:
Number of employees 0 0 1 1
Number of clients/users 94 91 88 90
Number of PC, servers, and
network devices 162 122 126 126
Network availability (estimate)99% 99% 98% 99%
198
BUDGET:
BUDGET COMMENTARY:
The IT Services Fund’s main source of revenue is internal user charges. The IT Services Fund
accounts for all activity supporting the city’s information technology infrastructure, including
servers, routers, PCs, printers, copiers, phones, and professional services. The city added an
internal staff position 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. A desire to account for all departments’ IT-
related purchases, managed by the IT Technician, through this internal service fund led to an
increased budget in 2022.
IT SERVICES 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 249,200$ 225,000$ 244,500$ 270,566$ 421,000$ 72.2%
Miscellaneous 7,084 5,621 3,500 (749) 4,000 14.3%
TOTAL REVENUES 256,284$ 230,621$ 248,000$ 269,817$ 425,000$ 71.4%
EXPENDITURES
Personnel Services -$ -$ 42,000$ 33,237$ 97,745$ 132.7%
Supplies 16,147 98,905 13,700 44,882 49,420 260.7%
Other Services & Charges 126,928 235,292 174,800 198,637 255,555 46.2%
Capital Outlay 7,468 11,597 17,500 35,353 22,280 27.3%
TOTAL EXPENDITURES 150,543$ 345,794$ 248,000$ 312,109$ 425,000$ 71.4%
FUND BALANCE - JANUARY 1 276,816$ 382,557$ 267,384$ 267,384$ 225,092$
Excess (Deficiency) of
Revenues over Expenditures 105,741 (115,173) - (42,292) -
FUND BALANCE - DECEMBER 31 382,557$ 267,384$ 267,384$ 225,092$ 225,092$
199
CENTRAL EQUIPMENT FUND (703-00000)
DEPARTMENT: Finance
SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The Central Equipment Fund is a self-sustaining internal service fund. The finance department
participates along with various department directors and division leaders in the acquisition of
capital assets. The acquired capital asset is charged back against the benefitting budget unit
through rental charges over a set number of years. The rental charge reflects depreciation plus
inflation. Service charges for each asset are fixed for the duration of rental payments.
OBJECTIVES:
1. 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. Demands on staff.
MEASURABLE WORKLOAD DATA:
Measurement 2019 2020 2021 2022
Outcome/Effectiveness:
Annual cost recovery 298,900$ 330,800$ 552,369$ 578,400$
Total costs of assets acquired 295,303$ 375,450$ 1,269,093$ 972,000$
Efficiency:
Cost recovery as % of
acquired assets 101% 88% 44% 60%
Work Load:
Number of fund assets 31 37 53 66
200
BUDGET:
BUDGET COMMENTARY:
The Central Equipment Fund’s main source of revenue is internal rental charges. The city
issued $515,000 in G.O. bonds in 2014 to finance the acquisition of a fire tender and a plow
truck. The 2021 operating transfers came from the closure of the Streets Reconstruction capital
projects fund and excess fund balance in the General Fund, which will help the fund with future
equipment purchases.
The 2022 budgeted equipment acquisitions: [public works equipment] engineering inspection
vehicle - $35,000; paver and trailer - $130,000; dump truck - $350,000; 1.5-ton truck - $80,000;
mini loader - $100,000; [recreation equipment] Kawasaki Mule - $15,000; two (2) Toro 7200D
mowers - $42,000; Toro 4100D mower - $87,000; Isuzu - $63,000; [public safety] building
inspection vehicles - $70,000.
REMAINING DEBT SERVICE:
CENTRAL EQUIPMENT FUND 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 330,800$ 330,800$ 436,600$ 552,369$ 572,400$ 31.1%
Miscellaneous 22,537 12,421 3,400 43,422 10,600 211.8%
Contributed Capital - - - 44,955 - ---
Operating Transfers In 200,000 - 560,000 1,573,657 - -100.0%
TOTAL REVENUES 553,337$ 343,221$ 1,000,000$ 2,214,402$ 583,000$ -41.7%
EXPENDITURES
Capital Outlay 186,026$ -$ 922,000$ 43,169$ 972,000$ 5.4%
Debt Service 131,477 10,168 67,000 6,658 66,000 -1.5%
TOTAL EXPENDITURES 317,503$ 10,168$ 989,000$ 49,827$ 1,038,000$ 5.0%
FUND BALANCE - JANUARY 1 393,703$ 629,537$ 962,590$ 962,590$ 3,127,165$
Excess (Deficiency) of
Revenues over Expenditures 235,834 333,053 11,000 2,164,575 (455,000)
FUND BALANCE - DECEMBER 31 629,537$ 962,590$ 973,590$ 3,127,165$ 2,672,165$
Payable Principal Interest Rate Total
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 180,000$ 10,620$ 190,620$
GO Bonds, Series 2014A (Equipment Portion)
201
BENEFIT ACCRUAL FUND (704-00000)
DEPARTMENT: Finance
SUPERVISOR: Finance Director
ACTIVITY SCOPE:
The Benefit Accrual Fund is a self-sustaining internal service fund. The finance department,
supervisors and the human resources manager oversee vacation, sick leave, and paid-time-off
(PTO) benefits. The non-enterprise fund liability for this benefit is recorded in the Benefit
Accrual Fund. Enterprise funds maintain the liability for employees involved in enterprise
operations. Expenditures in each governmental fund budget unit are adjusted annually to
reflect changes to the liability caused by the employees of that budget unit.
OBJECTIVES:
1. 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 2019 2020 2021 2022
Outcome/Effectiveness:
Annual hours accrued:
PTO 8,905 8,719 9,391 9,500
Vacation & Sick Leave 816 613 272 272
Balance of accrued hours:
PTO 7,949 9,134 9,127 8,500
Vacation & Sick Leave 2,770 1,907 647 650
Efficiency:
Annual hours accrued per employee:
PTO 175 156 168 167
Vacation & Sick Leave 272 307 272 272
Work Load:
Employees accruing hours:
PTO employees 51 56 56 57
Vacation & Sick Leave
employees (pre-1990)3 2 1 1
202
BUDGET:
BUDGET COMMENTARY:
The Benefit Accrual Fund’s main source of revenue is internal charges to personnel services in
three of the city’s main governmental funds: General Fund, Economic Development Authority
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 up to 320 hours of accrued
PTO.
BENEFIT ACCRUAL FUND 2019 2020 2021 2021 2022 %
REVENUES ACTUAL ACTUAL BUDGET PROJECTED BUDGET CHANGE
Charges for Services 110,701$ 6,541$ 16,000$ (18,526)$ 12,000$ -25.0%
Miscellaneous 9,587 6,927 3,000 (1,899) - -100.0%
TOTAL REVENUES 120,288$ 13,468$ 19,000$ (20,424)$ 12,000$ -36.8%
EXPENDITURES
Personnel Services 29,841$ 6,541$ 16,000$ (18,526)$ 12,000$ -25.0%
TOTAL EXPENDITURES 29,841$ 6,541$ 16,000$ (18,526)$ 12,000$ -25.0%
FUND BALANCE - JANUARY 1 257,639$ 348,086$ 355,013$ 355,013$ 353,114$
Excess (Deficiency) of
Revenues over Expenditures 90,447 6,927 3,000 (1,899) -
FUND BALANCE - DECEMBER 31 348,086$ 355,013$ 358,013$ 353,114$ 353,114$
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2022 ADOPTED BUDGETAppendix
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 2020 U. S. Census estimated
Monticello's population at 14,455, 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. City
unemployment rates are like that of the state, but from 2015 to 2019, 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
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%
2021 72,474 2.7%3.0%
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
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Monticello’s population and households are roughly 0.25% of the state’s total for both measures. With
a Walmart, Target, Home Depot, Runnings, and Mills Fleet Farm, it is no surprise that retail sales per
person are higher than the state average. The following table contains selected facts about the city:
The nuclear plant accounts for approximately 48% 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 third
lowest in Wright County. An Xcel 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 Minnesot a
Population, 2021 estimate July 1 14,445 5,707,390
Population, Census, April 1, 2020 14,445 5,706,494
Population, percent change, April 1, 2020 to July 1, 2021 0.0% 0.0%
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%
Hispanic or Lation, percent 8.2% 5.6%
Housing units, July 1, 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
Retail sales per capita, 2012 $26,746 $14,667
Median household income, 2015-2019 $70,394 $71,306
Per capita money income in the past 12 months, 2015-2019 $28,965 $37,625
Populatiom per square mile, 2010 1,427.2 66.6
Land area in square miles, 2010 8.94 79,626.74
2019 2020 2021 2022 2021-22 2021-22
City Tax Rate Tax Rate Tax Rate Tax Rate Change Change %
City of St. Michael 36.939 36.691 35.817 33.909 -1.908 -5.6%
City of Otsego 36.060 35.099 34.653 34.545 -0.108 -0.3%
City of Monticello 34.262 34.967 35.659 36.536 0.877 2.4%
City of Hanover 43.935 44.889 46.491 43.569 -2.922 -6.7%
City of Rockford 50.931 48.674 44.345 43.836 -0.509 -1.2%
City of Albertville 47.294 47.067 46.801 46.355 -0.446 -1.0%
City of Dayton 55.212 54.139 51.378 47.733 -3.645 -7.6%
City of Delano 53.399 52.913 49.369 49.061 -0.308 -0.6%
City of Montrose 56.457 50.952 51.607 51.719 0.112 0.2%
City of Annandale 58.156 55.706 54.571 54.606 0.035 0.1%
City of Buffalo 57.199 55.811 54.256 55.034 0.778 1.4%
City of Waverly 69.011 64.252 60.997 57.262 -3.735 -6.5%
City of Maple Lake 66.307 65.428 61.994 62.164 0.170 0.3%
City of Howard Lake 70.532 70.889 72.596 67.661 -4.935 -7.3%
City of Cokato 77.029 71.410 68.015 68.079 0.064 0.1%
City of Clearwater 71.144 72.662 69.513 69.978 0.465 0.7%
City of South Haven 113.063 105.298 91.707 90.696 -1.011 -1.1%
CITY TAX RATES IN WRIGHT COUNTY, MINNESOTA
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Monticello grew by approximately 13% 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:
Year Population Change
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
2021 14,455 569
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PROPERTY TAX BASICS
Assessment and classification
The property tax system is a continuous cycle, but it effectively begins with the estimation of
property market values by local assessors. Assessors attempt to determine the approximate
selling price of each parcel of property based on the current market conditions.
Along with the market value determination, a property class is assigned to each parcel of
property based on the use of the property. For example, property that is owner-occupied as a
personal residence is classified as a residential homestead. The “use class” is important because
the Minnesota system, in effect, assigns a weight to each class of property. Generally, properties
that are associated with income production (e.g., commercial, and industrial properties) have a
higher classification weight than other properties.
The property classification system defines the tax capacity of each parcel as a percentage of each
parcel’s market value. For example, a $75,000 home which is classified as a residential
homestead has a class rate of 1.0 percent and therefore has a tax capacity of $75,000 x .01 or
$750. (A sample of the class rates is included in the table on the next page.)
[parcel market value] * [class rate] = [parcel tax capacity]
The next step in calculating the tax burden for a parcel involves the determination of each local
unit of government’s property tax levy. The city, county, school district, and any special property
taxing authorities must establish their levy by December 28 of the year preceding the year in
which taxpayers will pay the levy. The property tax levy is set after the consideration of all other
revenues including state aids such as LGA.
[city budget] - [all non-property tax revenues] = [city levy]
Local tax rates
Local governments do not directly set a tax rate. Instead, the tax rate is a function of the levy and
the total tax base. To compute the local tax rate, a county must determine the total tax capacity
to be used for spreading the levies. The total tax capacity is computed by first aggregating the
tax capacities of all parcels within the city. Several adjustments to this total must be made
because not all tax capacity is available for general tax purposes. The result of this calculation
produces taxable tax capacity. Taxable tax capacity is used to determine the local tax rates.
[city levy] / [taxable tax capacity] = [city tax rate]
Parcel tax calculations
The property tax bill for each parcel of property is determined by multiplying the parcel’s tax
capacity by the total local tax rate. The tax statement for each individual parcel itemizes the
taxes for the county, municipality, school district, and any special taxing authorities.
[parcel tax capacity] * [total local tax rate] = [parcel property tax bill]
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.
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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 2022
State Tax Payable 2022
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 2022
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. (September 13 & September 27, 2021)
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.
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 13, 2021)
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 13, 2021)
**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.
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
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to each taxing jurisdiction. If other jurisdictions (county and school district) approve an abatement,
this revenue may be pledged to bonds issued by the city.
The principal amount of the bonds may not exceed the sum of the authorized abatements. A
debt service levy may be used to pay interest on the bonds.
The annual amount of all abatements cannot exceed the greater of 10% net tax capacity
value of the jurisdiction or $200,000.
The parameters of the abatement and authorization for the bonds are set by resolution. The
resolution cannot be approved until after a public hearing is held.
Street Reconstruction Bonds
Street Reconstruction Bonds are an example of debt issuing authority found in unusual places. The
statutory provisions for Street Reconstruction Bonds appear in the portion of Chapter 475 dealing
with election requirements for debt issuance (Section 475.58, Subd. 3b).
Street Reconstruction Bonds can be used to finance the reconstruction and bituminous overlay of
existing city streets. Eligible improvements may include turn lanes and other improvements having a
substantial public safety function, realignments, other modifications to intersect with state and county
roads, and the local share of state and county road projects. Except in the case of turn lanes, safety
improvements, realignments, intersection modifications, and the local share of state and county road
projects, street reconstruction and bituminous overlays does not include the portion of project cost
allocable to widening a street or adding curbs and gutters where none previously existed. The enabling
statute sets forth specific requirements for the issuance of Street Reconstruction Bonds:
The projects financed under this authority must be described in a street reconstruction plan.
The plan must describe the street reconstruction or overlay to be financed, the estimated costs,
and any planned reconstruction or overlay of other streets in the municipality over the next five
years
The city must hold a public hearing on the proposed plan and the related issuance of bonds.
The plan and the issuance of bonds must be approved by the city council by a vote of all the
members of the governing body present at the meeting.
The issuance of bonds is subject to a reverse referendum. An election is required if voters equal
to 5% of the votes cast in the last municipal general election file a petition with the city clerk
within 30 days of the public hearing. If the city decides not to undertake an election, it may not
propose the issuance of Street Reconstruction Bonds for the same purpose and in the same
amount for a period of 365 days from the date of receipt of the petition. If the question of issuing
the bonds is submitted and not approved by the voters, the provisions of section 475.58,
subdivision 1a, shall apply (no resubmission for same purpose/ amount for 180 days).
Street Reconstruction Bonds are subject to the debt limit.
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”
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with a pledge-able source of revenue may use this authority. Minnesota cities do not frequently
issue Revenue Bonds. Most borrowing needs have separate statutory authority that allows a general
obligation pledge. The most common Revenue Bonds are for electric utilities, sales taxes, and liquor
stores.
Improvement Bonds
One of the most used tools is General Obligation (G.O.) Improvement Bonds issued pursuant to
Chapter 429. Improvement Bonds can be issued for a wide range of public improvements.
Eligible Improvements
The types of improvements specifically authorized in Chapter 429 can be found in Section 429.021.
It is important to read and understand the specific statutory provisions. Some provisions are
broader than the basic improvement. For example, a “street improvement” may also include
streetscape (beautification), storm sewers and utility connection lines. Other provisions may
contain important expansions or limitations on the authority. Sanitary and storm sewer
improvements may be made outside of the city limits.
The public improvements currently authorized in Chapter 429 include the following:
1. Acquire, open, and widen any street, and improve the same by constructing, reconstructing,
and maintaining sidewalks, pavement, gutters, curbs, and vehicle parking strips of any
material, or by grading, graveling, oiling, or otherwise improving the same, including the
beautification thereof and including storm sewers or other street drainage and connections
from sewer, water, or similar mains to curb lines.
2. Acquire, develop, construct, reconstruct, extend, and maintain storm and sanitary sewers and
systems, including outlets, holding areas and ponds, treatment plants, pumps, lift stations,
service connections, and other appurtenances of a sewer system, within and without the
corporate limits.
3. Construct, reconstruct, extend, and maintain steam heating mains.
4. Install, replace, extend, and maintain streetlights and street lighting systems and special
lighting systems.
5. Acquire, improve, construct, reconstruct, extend, and maintain water works systems,
including mains, valves, hydrants, service connections, wells, pumps, reservoirs, tanks,
treatment plants, and other appurtenances of a water works system, within and without the
corporate limits.
6. Acquire, improve, and equip parks, open space areas, playgrounds, and recreational facilities
within or without the corporate limits.
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.
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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 because of the improvement. There is no
requirement to make this finding as part of the improvement process. The issue comes into play
primarily in projects with larger assessments and greater risk of appeal.
Assessments are also constrained by the notice of hearing for the improvement. The total amount
assessed cannot exceed the amount stated in the notice. The area assessed cannot be larger, but can
be smaller, than the area receiving notice of the Hearing.
The special assessment calculation is based on the “improvement.” An improvement may be more
than a single project. There are two ways to manage multiple projects into a single improvement for
the purposes of Chapter 429. Section 429.021, Subd. 2 allows for an improvement on two or more
streets, or two or more types of improvements, in or on the same street or streets or different streets
may be included in one proceeding and conducted as one improvement. This combining of
improvements is typically spelled out in the engineering feasibility report and considered at the
improvement hearing. Projects that are instituted separately may be subsequently combined under
the authority of Section 435.56.
Revenues to pay debt service on the portion that is not assessed may come from any legally
available source including a property tax levy.
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 number of initial prepayments. Delaying financing until after the assessment process
requires city funds to pay for construction and a reimbursement resolution to allow the
repayment of these funds with the proceeds of tax-exempt bonds.
For controversial projects with a higher risk of assessment appeals, cities will conduct the assessment
process during the period between the receipt and award of construction bids. This approach allows
the city to know the appeal risk before committing to undertake the improvement. Improvement
Bonds are not subject to the statutory debt limit.
Utility Revenue Bonds
Minnesota cities rarely issue pure Revenue Bonds to finance sanitary sewer, water, and storm sewer
utility improvements. State Law allows cities to add its general obligation to the pledge of net utility
revenues for these improvements (Section 444.075). G.O. Utility Revenue Bonds may be issued to
build, construct, reconstruct, repair, enlarge, improve, or in any other manner obtain sanitary sewer,
water, and storm sewer facilities, and maintain and operate the facilities inside or outside its
corporate limits.
These bonds are sometimes called “double barreled.” They are secured by both utility revenues and
the city’s general obligation. The bonds may be secured by a single utility or by combined 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.
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
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higher” than the yield on the bonds. The complexities of arbitrage calculation and compliance are
not discussed in this guide. Instead, this guide focuses on the three basic arbitrage considerations
for most Minnesota cities: construction fund, debt service fund, and arbitrage rebate.
Arbitrage Rebate
Issuers must pay (rebate) to the federal government income earned in excess of the bond yield unless
subject to the small issuer or the spenddown exceptions.
The small issuer exception applies when the total principal amount of tax exempt, non-private
activity bonds does not exceed $5,000,000 in any calendar year. Current refunding bonds up to
the amount of the outstanding principal refunded do not count against this limit. There are three
options for meeting the spenddown exception:
1. 6-month exception - gross proceeds and interest earnings are allocated to expenditures for
governmental or qualified purposes that are incurred within 6 months after the date of
issuance.
2. 18-month exception - gross proceeds and interest earnings are spent within the following
schedule from date of issuance: (1) 15% within 6 months; (2) 60% within 12 months; and (3)
100% within 18 months (with a 5% reasonable retainage carryover amount for an additional 12
month period).
3. 2-year spending exception – issue is a “construction issue” (75% of issue is actually spent on
construction) and gross proceeds and interest earnings are spent within the following schedule
from date of issuance: (1) 10% within 6 months; (2) 45% within 12 months; (3) 75% within 18
months; and 4) 100% within 24 months.
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MINNESOTA STATUTES
DEBT LIMIT
475.53 LIMIT ON NET DEBT
Subdivision 1. Terms.
For the purposes of this chapter, the terms defined in this section shall have the meanings given
them.
Subd. 2. Municipality.
"Municipality" means a city of any class, county, town, or school district.
Subd. 3. Obligation.
"Obligation" means any promise to pay a stated amount of money at a fixed future date or upon
demand of the obligee, regardless of the source of funds to be used for its payment, made for
the purpose of incurring debt, including the purchase of property through an installment
purchase contract or any other deferred payment agreement, for which funds are not
appropriated in the current year's budget.
Subd. 4. Net debt.
"Net debt" means the amount remaining after deducting from its gross debt the amount of
current revenues which are applicable within the current fiscal year to the payment of any debt
and the aggregate of the principal of the following:
(1) Obligations issued for improvements which are payable wholly or partly from the
proceeds of special assessments levied upon property specially benefited thereby, including
those which are general obligations of the municipality issuing them, if the municipality is
entitled to reimbursement in whole or in part from the proceeds of the special assessments.
(2) Warrants or orders having no definite or fixed maturity.
(3) Obligations payable wholly from the income from revenue producing conveniences.
(4) Obligations issued to create or maintain a permanent improvement revolving fund.
(5) Obligations issued for the acquisition, and betterment of public waterworks systems, and
public lighting, heating, or power systems, and of any combination thereof or for any other
public convenience from which a revenue is or may be derived.
(6) Debt service loans and capital loans made to a school district under the provisions of
sections 126C.68 and 126C.69.
(7) Amount of all money and the face value of all securities held as a debt service fund for the
extinguishment of obligations other than those deductible under this subdivision.
(8) Obligations to repay loans made under section 216C.37.
(9) Obligations to repay loans made from money received from litigation or settlement of
alleged violations of federal petroleum pricing regulations.
(10) Obligations issued to pay pension fund or other postemployment benefit liabilities under
section 475.52, subdivision 6, or any charter authority.
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(11) Obligations issued to pay judgments against the municipality under section 475.52,
subdivision 6, or any charter authority.
(12) All other obligations which under the provisions of law authorizing their issuance are not
to be included in computing the net debt of the municipality.
PROPERTY TAX LEVY
275.08 AUDITOR TO FIX RATE.
Subdivision 1. Generally.
The rate percent of all taxes, except the state tax and taxes the rate of which may be fixed by
law, shall be calculated and fixed by the county auditor according to the limitations in this
chapter hereinafter prescribed; provided, that if any county, city, town, or school district shall
return a greater amount than the prescribed rates will raise, the auditor shall extend only such
amount of tax as the limited rate will produce.
Subd. 1a. Computation of tax capacity.
The county auditor shall compute the net tax capacity for each parcel according to the
classification rates specified in section 273.13. The net tax capacity will be the appropriate
classification rate multiplied by the parcel's market value.
Subd. 1b. Computation of tax rates.
(a) The amounts certified to be levied against net tax capacity under section 275.07 by an
individual local government unit shall be divided by the total net tax capacity of all taxable
properties within the local government unit's taxing jurisdiction. The resulting ratio, the local
government's local tax rate, multiplied by each property's net tax capacity shall be each
property's net tax capacity tax for that local government unit before reduction by any credits.
273.032 MARKET VALUE DEFINITION.
For the purpose of determining any property tax levy limitation based on market value or any
limit on net debt, the issuance of bonds, certificates of indebtedness, or capital notes based on
market value, any qualification to receive state aid based on market value, or any state aid
amount based on market value, the terms "market value," "estimated market value," and
"market valuation," whether equalized or unequalized, mean the estimated market value of
taxable property within the local unit of government before any adjustments for tax increment,
fiscal disparity, powerline credit, or wind energy values, but after the limited market adjustments
under section 273.11, subdivision 1a, and after the market value exclusions of certain
improvements to homestead property under section 273.11, subdivision 16. Unless otherwise
provided, "market value," "estimated market value," and "market valuation" for purposes of this
paragraph, refer to the taxable market value for the previous assessment year.
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
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procedure of the city in the same manner as required of executive departments of the city or, if
no budgets are required to be filed, by August 1. The amount of the tax levy for the following
year shall be based on that budget.
469.001 PURPOSES.
The purposes of sections 469.001 to 469.047 are:
(1) to provide a sufficient supply of adequate, safe, and sanitary dwellings in order to protect
the health, safety, morals, and welfare of the citizens of this state;
(2) to clear and redevelop blighted areas;
(3) to perform those duties according to comprehensive plans;
(4) to remedy the shortage of housing for low- and moderate-income residents, and to
redevelop blighted areas, in situations in which private enterprise would not act without
government participation or subsidies; and
(5) in cities of the first class, to provide housing for persons of all incomes.
Public participation in activities intended to meet the purposes of sections 469.001 to 469.047
and the exercise of powers confined by sections 469.001 to 469.047 are public uses and
purposes for which private property may be acquired and public money spent.
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UTILITY RATES
Residential & Commercial Water: 10, 12, 16, 17 & 11, 11NT & 11TX, 13, 90
Sprinklers - Res Twnhm & Commercial: 30, 31, 31NT, 32, 32NT, 91, 91NT
0 - 1,000 gallons $8.04
1,001 - 10,000 gallons (9,000 gallons)$1.88/1,000 gallons
10,001 - 33,000 gallons (23,000 gallons)$2.18/1,000 gallons
33,001 gallons and over $2.39/1,000 gallons
Industrial Water: 14 (effective 7/1/22)
All Water Usage $2.29/1,000 gallons
State Water Service Connection Fee
Per Connection $0.81/mo.
Sewer Rates - Residential & Commercial: 20, 25, 26
0 - 1,000 gallons $10.40
1,001 gallons and over $6.38/1,000 gallons
Sewer Special Cases: SW21, SW22
Has own well $10 per person
Industrial Sewer Rates: 24 (effective 7/1/22)
All Sewer Usage $3.96/1,000 gallons
BOD5 (Biochemical Oxygen Demand)$0.427/lb.
TSS (Total Suspended Solids)$0.587/lb.
Testing Actual cost + 10%
Stormwater
Residential $4.00
Non-Residential (7 drainage units per impervious acre)$4.00
Residential Refuse Charges - Taxable (effective 2/1/22)
1st Individual Residential Cart $9.73
2nd Individual Residential Cart $13.00
Residential Recycling Charges (effective 2/1/22)
Per Cart $3.64
Other:
Water On/Off Charge: $25/each
Water Availability Charge: $42/yr.
Final Bill Processing Fee:$25.00
Refusal of Equipment (manual read) Charge:$50.00
Rates for 2022 Utility Billing
Increasing Block Rates
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CAPITALIZATION THRESHOLDS
Class of Asset Details
Useful
Life (Yrs)
Threshold
Land N/A $1
Land improvements 10-20 $50,000
Building/building improvements: 12-40 $20,000
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 10-40 $75,000
Paving Systems
Water, Sanitary & Stormwater
Secondary Infrastructure 10-40 $25,000
Sidewalk, Boardwalk, Pathways
Streetlights, Signage
Equipment 5-20 $10,000
Vehicles
Machinery
Software and
non-tangible 5-20 $10,000
Purchased and internally developed
Construction Work in Progress
Upon completion,
per above class
Equipment expenditures for items between $500 and $10,000 are recorded as small tools and
equipment, which is a supply account. Building and improvement expenditures below the
thresholds are recorded as repairs and maintenance. Current revenues finance expenditures for
supplies, repairs, and maintenance.
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TAX CAPACITY, TAX LEVY, & TAX RATE HISTORY
Tax Capacity City Tax HRA Tax Total Tax City Tax
Year Value Levy Levy Levy Capacity Rate
2013 18,692,762$ 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$ 34.470
2017 27,583,160$ 9,150,000$ 280,000$ 9,430,000$ 33.172
2018 29,528,145$ 9,547,000$ 323,000$ 9,870,000$ 32.332
2019 29,076,227$ 9,962,000$ 348,000$ 10,310,000$ 34.262
2020 29,870,392$ 10,445,000$ 355,000$ 10,800,000$ 34.968
2021 31,026,583$ 11,063,700$ 366,300$ $11,430,000 35.659
2022 30,816,639$ 11,353,000$ 388,000$ $11,741,000 36.840
$-
$5
$10
$15
$20
$25
$30
$35
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022MillionsTax Levies and Tax Capacity History
City Tax Levy HRA Tax Levy Tax Capacity Value
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USEFUL TERMS (GLOSSARY)
ACCOUNT: An organizational or budgetary breakdown found within city funds. A term used to
identify an individual asset, liability, expenditure (and other uses), revenue (and other sources),
or fund balance.
ACCOUNTS PAYABLE: Amounts owed to others for goods or services received.
ACCOUNTS RECEIVABLE: Amounts due from others for goods furnished or services rendered.
ACCOUNTING SYSTEM: The total set of records and procedures which are used to record,
classify, and report information on financial status and operations of an entity.
ACCRUAL BASIS OF ACCOUNTING: The method of accounting under which revenues are
recorded when they are earned, and expenditures are recorded when goods and services are
received.
ACTIVITY: A specific and distinguishable line of work performed by one or more organizational
components of a governmental unit for the purpose of accomplishing a function for which the
governmental unit is responsible. For example, "Ice & Snow Removal” is an activity performed as
part of the "Public Works" function.
AD VALOREM: In proportion to value. The basis for levying taxes on property.
AGENCY FUND: A fiduciary fund used to account for situations where the government’s role is
purely custodial.
AMORTIZATION: The action or process of gradually writing off the initial cost of an asset.
APPROPRIATION: An authorization granted by a legislative body to make expenditures and to
incur obligations for specific purposes. An appropriation is limited in amount to the time it may
be expended.
ARBITRAGE: The simultaneous purchase and sale of the same asset in different markets in order
to profit from tiny differences in the asset's listed price. In governments, this typically refers to
the investment of funds received as proceeds from bond issuances.
ASSESSED VALUATION: Value placed upon real estate or other property as a basis for levying
taxes.
ASSESSMENTS: Charges made upon parties for actual services or benefits received.
ASSETS: Property owned by a governmental unit, which has a monetary value.
ASSIGNED FUND BALANCE: Resources the government intends to use for specific purposes but
are neither restricted nor committed.
AUDIT: The examination of documents, records, reports, systems of internal control, accounting
and financial procedures, and other evidence for one or more of the following purposes: a) To
attest to whether the statements prepared from the accounts present fairly the financial position
and the results of financial operations of the constituent funds and balanced account groups of
the city in accordance with generally accepted accounting principles applicable to city and on a
basis consistent with that of the preceding year; b) To determine the propriety, legality, and
mathematical accuracy of a governmental unit's financial transactions; c) To ascertain whether
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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 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.
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.
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CASH BASIS: The method of accounting under which revenues are recorded when received in
cash and expenditures are recorded when paid.
CHART OF ACCOUNTS: The classification system used by a government entity to organize the
accounting for various funds and departments.
COMMITTED FUND BALANCE: Resources used for specific purposes pursuant to constraints
imposed by formal action of the government’s highest level of decision‐making authority (i.e.,
City Council).
CONSUMER PRICE INDEX (CPI): A statistical description of price levels provided by the U.S.
Department of Labor. The index is used as a measure of the increase in the cost of living (i.e.,
economic inflation).
CONTINGENCY: Budget for expenditures which cannot be placed in departmental budgets,
primarily due to uncertainty about the level or timing of expenditures when the budget is
adopted. The contingency also serves as a hedge against shortfalls in revenues or unexpected
expenditures.
CURRENT: A term applied to budgeting and accounting, designating the operations of the
present fiscal period as opposed to past or future periods including expenditures that do not
benefit more than one reporting period or meet the capitalization thresholds.
DEBT: An obligation resulting from borrowing money or purchasing goods and services.
DEBT LIMIT: The maximum amount of gross or net debt, which is legally permitted.
DEBT MARGIN: The amount of available debt, which may be issued by a governmental unit
before reaching its debt limit.
DEBT SERVICE FUND: A governmental fund type used to account for the accumulation of
resources for the payment of general long‐term debt principal and interest. Proprietary fund
type debt is accounted for in the enterprise fund or internal service fund receiving the debt issue
proceeds.
DEFICIT: An excess of expenditure or liabilities over income or assets in a given period.
DEPARTMENT: Basic organizational unit of government, responsible for carrying out related
functions. Each department serves a specific function as a distinct organizational unit of
government within the given fund. Its primary purpose is to facilitate organizational and
budgetary accountability.
DEPRECIATION: Expiration in the service life of capital assets attributable to wear and tear,
deterioration, action of the physical elements, inadequacy, or obsolescence.
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
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private business enterprises, where the intent of the governing body is to recover the cost of
delivering services through user fees or charges (Water, Sewer, Liquor, Deputy Registrar, and
Fiber Optic funds).
ESTIMATED MARKET VALUE: Represents the selling price of a property if it were on the market.
Estimated market value is converted to tax capacity before property taxes are levied.
EXPENDITURE: For accounts kept on the accrual or modified accrual basis of accounting, the cost
of goods received, or services rendered whether cash payment have been made or not. Where
accounts are kept on a cash basis, expenditures are recognized only when the cash payments for
the above purposes are made.
FIBERNET MONTICELLO (FNM): The name of the city‐owned fiber optic network, which provides
internet, phone, and cable television to residents and businesses of Monticello.
FIDUCIARY FUND: A fund classification used to report assets held in a trustee or agency capacity
for others and therefore cannot be used in the government’s own programs.
FINES: Revenues from penalties imposed for violation of laws or regulations.
FISCAL POLICY: A government’s policies with respect to revenues, spending, and debt
management as these relate to government services, programs, and capital investment. Fiscal
Policy provides an agreed‐upon set of principles for the planning and programming of budgets
and their funding.
FISCAL YEAR: The budget and accounting year that begins on the first day of January and ends on
the last day of December of each year.
FULL TIME EQUIVALENT (FTE): The number of employee hours (2,080) needed to be equal to
one full time employee. Several part time employees may be combined to make one FTE.
FUNCTION: A group of related activities aimed at accomplishing a major service or regulatory
program for which the government unit is responsible.
FUND: A fiscally independent accounting entity with a self‐balancing set of accounts recording
cash and/or other resources together with all related liabilities, obligations, and reserves, which
are segregated for the purpose of carrying on specific activities or attaining certain objectives.
Funds in the government model are classified into three broad categories: governmental,
proprietary, and fiduciary. The most common reason for establishing a fund is to separately
account for restricted‐use revenue or to comply with state or federal law.
FUND BALANCE: Governmental fund assets and deferred outflows of resources minus liabilities
and deferred inflows of resources.
GENERAL FUND: Accounts for the general operation of the city and all financial resources except
those to be accounted for in another fund.
GENERAL GOVERNMENT: A set of accounts, to which the expenditures for operating the city are
charged.
GENERAL OBLIGATION BONDS: Bonds for which the government pledges its full faith and credit
to the repayment of the bond’s principal, including interest.
GOVERNMENTAL ACCOUNTING: The composite of analyzing, recording, summarizing, reporting,
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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.
GRANT: A contribution of assets by one governmental unit or other organization to another.
HOMESTEAD AND AGRICULTURAL CREDIT (HACA): A form of state‐paid property tax relief for
farm property and owner‐occupied homes.
HOUSING AND REDEVELOPMENT ACT – SPECIAL BENEFIT LEVY: Property tax levied against the
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.
LEVY: (Verb) To impose taxes, special assessments, or service charges for the support of
governmental activities. (Noun) Taxes, special assessments, or service charges imposed by a
governmental unit.
LEVY LIMIT: The city’s maximum property tax levy without special authorization as defined by
Minnesota State Statue.
LINE ITEM: A specific item or group of related items defined by detail in a unique account in the
financial records.
LOCAL GOVERNMENT AID (LGA): Intergovernmental revenue from the state to municipalities to
help fund general expenditures.
LONG‐TERM DEBT: Debt with a maturity of more than one year after the date of issuance.
MAINTENANCE: The upkeep (repairs and maintenance) of physical properties in condition for
use or occupancy.
MAJOR FUND: For budgetary purposes, a fund whose revenues or expenditures, excluding other
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financing sources and uses, constitute more than 10% of the revenues or expenditures of the
appropriated budget.
MARKET VALUE: An assessor’s estimate of what property would be worth on the open market if
sold. The market value is set on January 2 of the year before taxes are payable.
MARKET VALUE EXCLUSION (MVE): Provision in the state property tax system which exempts or
removes a portion of a property’s market value from property taxes.
MISCELLANEOUS: Revenues or expenditures not classified in any other revenue or expenditure
category.
MODIFIED ACCRUAL BASIS: The basis of accounting under which expenditures other than
accrued interest on general long‐term debt are recorded at the time liabilities are incurred and
revenues are recorded when received in cash except for material and/or available revenues,
which should be accrued to reflect properly the tax levied, and revenue earned.
NON‐MAJOR FUND: For budgetary purposes, a fund whose revenues and expenditures,
excluding other financing sources and uses, are less than 10% of the revenues and expenditures
of the appropriated budget.
NONSPENDABLE FUND BALANCE: Amounts that cannot be spent because they are either (a) not
in spendable form or (b) legally or contractually required to be maintained intact. Nonspendable
fund balances typically include inventory, prepaid items, and land held for resale.
OBJECT OF EXPENDITURE: Expenditure classifications based upon the types of items purchased or
services obtained. Examples of objects of expenditure include salaries, supplies, contracted service, etc.
OBJECTIVE: Desired output‐oriented accomplishments, which can be measured and achieved
within a given period.
OPERATING BUDGET: A financial plan that estimates revenues and expenditures for a specified
period.
OPERATING EXPENSE: The cost for personnel, materials, and equipment required for a
department to function.
OPERATING REVENUE: Monies received from ongoing operations. Operating revenues are used
to pay for day‐to‐day services.
ORDINANCE: A formal legislative enactment by the City Council.
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
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position (or cost recovery), financial position, and cash flows. There are two types of proprietary
funds: enterprise funds and internal service funds. For this report, these funds have the same
budgetary basis as governmental funds.
PUBLIC SAFETY: Expenditures related to the protection of persons and property.
PUBLIC WORKS: Expenditures for the maintenance of city property and infrastructure.
REFUNDING BONDS: Bonds issued to redeem outstanding (unpaid) debt.
REIMBURSEMENT: Cash or other assets received as a repayment of the cost of work or services
performed or of other expenditures made for or on behalf of another governmental unit or
department or for an individual, firm, or corporation.
RESERVE: An account which records a portion of the fund balance which must be segregated for
some future use, and which is, therefore, not available for further appropriation or expenditure.
RESOLUTION: A special or temporary order of a legislative body; an order of a legislative body
requiring less legal formality than an ordinance or statute.
RESOURCES: The actual assets of a governmental unit, such as cash, plus contingent assets such
as estimated revenues applying to the current fiscal year not accrued or collected, and bonds
authorized and not issued.
RESTRICTED FUND BALANCE: Fund balance should be reported as restricted when constraints
placed on the use of resources are either: a) externally imposed by creditors (such as through
debt covenants), grantors, contributors, or laws or regulations of other governments; or b)
imposed by law through constitutional provisions or enabling legislation.
REVENUE: The term designates an increase to a fund's assets which: 1) does not increase a
liability; 2) does not represent a repayment of an expenditure already made; 3) does not
represent a cancellation of certain liabilities; and 4) does not represent an increase in
contributed capital.
REVENUE BOND: A bond that is backed by a particular revenue source such as water user fees,
typically accounted for in proprietary fund types.
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.
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TAXABLE MARKET VALUE: The market value of a property less the market value exclusion. This is
the value used to calculate property taxes on a property.
TAXES: Compulsory charges levied by a governmental unit for the purpose of financing services
performed for the common benefit.
TOTAL TAX CAPACITY: The amount computed by first totaling the tax capacities of all parcels of
property within a city. Adjustments for fiscal disparities, tax increment, and a portion of the
powerline value are made to this total since not all tax capacity is available for general tax
purposes.
TRUST FUND: A fund consisting of resources received and held by the governmental unit as
trustee, which is to be expended or invested in accordance with the conditions of the trust.
UNASSIGNED FUND BALANCE: This is the residual classification for the General Fund. This is
fund balance that has not been reported in any other classification. The General Fund is the only
fund that can report a positive unassigned fund balance. Other governmental funds would report
deficit fund balances as unassigned.
UNBALANCED BUDGET: A budget in which undesignated fund balance or reserves are used or
increased, to balance estimated revenues to estimated expenditures or expenses.
UNRESTRICTED FUND BALANCE: The portion of a fund’s balance that is not restricted for a
specific purpose and is available for general appropriation.
WORKING CAPITAL: Current assets less current liabilities. The modified accrual balance of
resources in enterprise funds after factoring out long‐term assets and liabilities that do not
impact current, near‐term operations.
ACRONYMS
BCOL Bertram Chain of Lakes
ACFR Annual Comprehensive Financial Report
CARES Coronavirus Aid, Relief & Economic Security Act
CIP Capital Improvement Plan
CPI Consumer Price Index
DMV Department of Motor Vehicle
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
MCM Minimum Control Measures
MVE Market Value Exclusion
SAC Sewer Availability Charge
SCADA Supervisory Control and Data
Acquisition
SCDP Small Cities Development Program
TIF Tax Increment Financing
WAC Water Availability Charge
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