A-1. Review of 2014 Financial Audit , Tautges Redpath y
. �� `
CITY O�i' MEMORANDUIi�I
u��(�J�li��i�i'
""""`�����' TO: Mayor& City Council '
7700 Market Boulevard �
Po Box 147 FROM: Greg Sticha, Finance Directoi- ��'�" �
Chanhassen�MN 55317
DATE: June 8, 2015
��'�
Administration �„
Phone:95222I.1100 SUBJ: Rev1eW 2014 Audit
Fax 952.227.1110
Building Inspections
Phone:952227.118o The Finance Department just finished aiiother audit cycle. Andy Herring from
Fax:952.227.1190 HLB Tautges Redpath will be present to review the financial results and audit
findings for 2014.
Engineering
Phone:952.271.1160 $ACKGROUND
Fax:952.27/.1110
Financ� The financial statements take into account the city's entire financial picture and
Phone 952 7_2/.r��o are in a format similar to a proprietary or for-profit orgailization. This includes a
I=ax�952 227.�t�o statement of activities that break out the primary government and proprietary
revenues and expenses by function.
f�arEz£G t�ecre�tion
Phone:952.2?�/.I I2o There are three reports that HLB Tautges Redpath completes for the city as part of
�-ax:�5222��1���o the audit. Attached are copies of all tlu�ee reports and representatives from HLB
��ce�afioi���ot�r Tautges Redpath will review each report with the city counciL In addition, they
23�o Coulter Qoulevard will be reviewing a PowerPoint that will give some insight on how a number of
Phone:952.227.140o various funds finished the 2014 audit year.
1 ax:952.7�1110�1
ATTACHMENTS
f'lannin�R�
IUafural Resource5
Phone�952.2271130 1. 2014 Comprehensive Annual Financial Report
Fax:952.227.�110 2. Additional Audit Reports that will be presented by the Auditors
3. PowerPoint Presentation dated June 8, 2015
Public Works
7901 Park Placc
Phone:952.2271300
Fax:952.2271310
Senior Center
Phone:952.227.1125
Fax:952.2271110
Website
ww�,v.cl.chanhassem m�us
f:Agregslaudit�2014\review of 2014 audit.docx
GI»niiassen is a Com��iunify for Life-Pio��idlnq ioi I��day an�l I'lanning forl��rnoriov�i
COMPREHENSIVE ANNUAL FINANCIAL REPORT
OF THE CITY OF CHANHASSEN, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2014
Finance Department
Greg Sticha, Finance Director
Member of Government Finance Officers '
Association of United States and Canada
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CITY OF CHANHASSEN,MINNESOTA
TABLE OF CONTENTS
Page
Reference No. ��I
I.INTRODUCTORY SECTION
Letter of Trans�nittal 3
Certificate of Achievement 6
Oiganization Chart 7
Organization g
II.FINANCIAL SECTION
Independent Auditor's Report 11
Management's Discussion and Analysis 15
Basic Financial Statements:
Government-Wide Financial Statements:
Statement of Net Position Statement 1 31
Statement of Activities Statement 2 32
Fund Financial Statements:
Balance Sheet-Governmental Funds Stateinent 3 34
Statement of Revenues,Expenditures and Changes in Fund Balances-
Govennnental Funds Stateinent 4 36
Reconciliation of the Statement of Revenues,Expenditur�es and Changes in
Fund Balances of Govei•�unental Funds To tlie Statement of Activities Statement 5 38
Statement of Net Position-Proprietaiy Funds Statement 6 39
Statement of Revenues,Expenses and Changes in Fund Net Position-
Proprietary Funds Statement 7 40
Statement of Cash Flows-Pr•oprietaiy Funds Statement 8 41
Statement of Net Position-Fiduciary Funds Statement 9 42
Notes to Financial Statements 43
Required Supplementary Information:
Budgetajy Comparison Schedule-General Fund Statement 10 80
Schedule of Funding Progress-Retiree Health Plan g6
CITY OF CHANHASSEN,MINNESOTA
TABLE OF CONTENTS
Page
Reference No. ���
Combining and Individual Nonmajor Fund Financial Statements and Scl�edules:
Combining Balance Sheet-Nonmajor Governmental Funds Stateinent 11 90
Combining Statement of Revenues,Expenditures and Changes in Fund Balances-
Nonmajor Govermnenta]Funds Statement 12 91
Subcombining Balance Sheet-Nonmajor Special Revenue Funds Statement 13 94
Subcombining Statement of Revenues,Expenditures and Changes in
Fund Balances-Nonmajor Special Revenue Funds Stateine�lt 14 95
Subcombining Balance Sheet-Nonmajor Debt Service Funds Statement 15 98
Subcombining Statement of Revenues,Expenditures and Changes in
Fund Balances-Nonmajor Debt Se�vice Funds Statement 16 99
Subcombining Balance Sheet-Nonmajor Capital Project Funds Statement 17 102
Subcombining Statement of Revenues,Expenditures and Changes in
Fund Balances-Nonmajor Capital Pi•oject Fw�ds Statement 18 105
Special Revenue Funds:
Sclledules of Revenues,Expenditures and Changes in
Fund Balances-Budget and Actual:
Contribution Fund Statement 19 108
CATV Statement 20 109
Combining Statement of Net Position-Agency Funds Statement 21 112
Combining Statement of Changes in Assets and Liabiliries-Agency Funds Statement 22 113
III.STATISTICAL SECTION(UNAUDITED)
Financial Tr•ends:
Net Position by Component Table 1 118
Cl�anges in Net Posirion Table 2 120
Fund Balances-Goveinmental Funds Table 3 124
Cllauges in Fund Balances-Governmental Funds Table 4 126
Revenue Capacity:
Tax Capacity and Estiinated Market Value of Taxable Property Table 5 128
Direct and Ovel•lapping Property Tax Capacity Rates Table 6 130
Principal Property Taxpayeis Table 7 131
Property Tax Levies and Collections Table 8 133
i CITY OF CHANHASSEN,iVIIl�'NESOTA I
TABLE OF CONTENTS
Page
Reference No.
Debt Capacity:
Ratios of Outstanding Debt by Type Table 9 134
Ratios of General Bonded Debt Outstanding Table 10 136
Direct and Overlapping Governmenta]Activities Debt Table 11 137
Legal Debt Margin Iuformation Table 12 139
Pledged Revenue Coverage Table 13 140
Demographic and Economic:
De�nographic and Economic Statistics Table 14 141
Principal Employers Table 15 143
Operating Information:
Full-Time Equivalent City Gove�nment Employees by Function/Program Table 16 144
Operating Indicators by Function/Prograin Table 17 146
Capital Asset Statistics by Function/Program Table 18 148
IV. OTHER INFORMATION(UNAUDITED)
Combined Schedule of Indebtedness Exhibit 1 152
Debt Service Payments to Maturity:
General Obligation Bonds-Governmental Activities Exhibit 2 154
General Obligation Revenue Bonds Exl�ibit 3 155
Schedule of Deferred Tax Levies Exhibit 4 156
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I. INTRODUCTORY SECTION
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2
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(�i►�t�(��� May 19,2015 �,I
t�ll tl
Yj������"�a�� To the Honorable Mayor and City Council
7700 Markei Boulevard City of Chanhassen
PO Box 147 Chanhassen,Minnesota
Ghanhassen,NN�5317
The Comprehensive Annual Financial Report of the City of Chanhassen,Minnesota(the City)
Administration for the fiscal year ended December 31,2014 is hereby submitted. This report was prepared by
I'hone�952227.1100 the Chanhassen Finance Department and responsibility for both the accuracy of the presented
Fax:952.227.1110 data and the completeness and fairness of the presentation,including all disclosures,supporting
schedules and statistical tables rests with the City. We believe the data,as presented,is accurate
Building Inspections �all material respects;tliat it is presented in a manner designed to fairly set forth the financial
Phone:952.27_7.1180 position and results of operations of the City as measured by the financial activity of its various
1 ax:952.227.1190 �ds;and that all disclosures necessary to enable the reader to gain the maacimum understanding
of the City's financial affairs have been included.
Engineering �e organization,form and contents of this report were prepared in accordance with the
('hone:952.2?_7.1160 standards prescribed by the Governmental Accounting Standards Board,the Government
Fax:852.227.1170 ��ance Officers Association of the United States and Canada(GFOA),the American Institute
of Certified Public Accountants,Minnesota's Office of the State Auditor and City policies.
Finance
Phone:952?_?_Z1140 This transmittal letter is designed to complement the Management's Discussion and Analysis
E ax:9522I7.1110 (MD&A)and should be read in conjunction with it. The MD&A can be found immediately
following the report of the independent auditors.
Park&Recreation
Phone:952.227.1120 Reporting Entity and Its Services
Fax 952.227.1110
This report includes all funds,account groups,and departments of the City(the prunary
Recreation Cenier govemment)and its component unit. 'I'he City provides a full range of services to its residents
2310 Coulter Boulevard and businesses inctuding genera(government,public safety(police and fire protection),public
Phone:952.227.1�100 works(engineexing,streets,and equipment maintenance),parks and recreational activities,
Fax:952.2?I.1404 planning and economic development. In addition to general municipai services,the City
provides water and sanitary sewer service and oversight(through licensing)of the refuse and
Planning& recycling services. In accordance with the reporting entity definition of the Governmental
Natural Resources Accounting Standards Board,the City has included the Chanhassen Economic Development
F'hone:952.22Z1130 Authority(EDA)in these financial statements as a blended component unit. The EDA is
�ay,.g,�,??Z11�� governed by five commissioners appointed by the City Council with the City Manager as
executive director. The Chanhassen Fire Relief Association has been excluded from this report
Public Works because it is governed by a board elected by its members and it is not�scally dependent upon
/901 Park Pl�ce the City. The Western Area Fire Training Association(WAFTA)is governed�by an eleven-
person board comprised of one member appointed by each jurisdiction who is a party to the joint
Phonr,;9�i7_.221.1300 powers agreement. Although the City is jointly responsible for the maintenance and cleanup
1 ax:952.22I.131t, costs of the training site in rural Carver County,we do not exercise substantial control of the
association.The school districts that serve residents of the City,like all school districts in
Seniar Center Minnesota,are governed independentty by their own elected board rnernbers. They levy their
{'hone:952227:112!i own taxes and prepare their own financial reports. Accordingly,they are excluded from this
1 ar,:952.2271110 report.
Websiie
���+�vt�v.ci.r,hanhassen.rni�.us
fhanhassen is a Cmnmuniiy lor Lite 31'rr,vidin��ioi lotlayand�'l�anr�li!��lor loinorro!•�r
Releva�at Firiancial Policies '�
I
The City has a policy regarding General Fund rese�ve balances. The City has a designated fund balance in the j
General Fund equivalent to 50%of the ensuing year's budgeted tax levy to provide wor•king capital between set•ve-
owned property tax settlements.
The pi•ima�y financial goal of the City's investment policy is to ensure the safety and pi•incipal invested by the
City. Cash temporarily idle during the year is ulvested in cei•tificates of deposit and obligations of the U.S.
Treasu3y and government agencies. The City only invests in instruments autharized under Minnesota Statute
118A. Cash balances fi•om all City funds are pooled into an invesrinent fund and inveshnent income is distributed
on a pro-rata basis at the end of the year,based on average monthly cash balances. At December 31,2014,the
matw•ities of the investments i•ange from 1 day to 7 year•s,with an average maturity of 2.06 years. Matut•ities are
not to exceed 7 years unless for a dedicated pmpose such as a futut•e bond payment. The average yield to matm�ity
on the portfolio at December 31,2014 was 1.10%. It is the City's practice to hold all instruments to maturity.
Economic Condztion and Outlook
The City of Chanhassen,Minnesota,located southwest of the Twin Cities meri•opolitan af•ea,is situated prilnarily
in Carver County with a small portion in Hennepin County. The City encompasses an area of 23.79 square miles.
U.S.Highways 169 and 212,as well as State Highways 5,7,41 and 101,provide access foi•commuters coming
into the City fi•om the Twin Cities metropolitan area as well as for residents traveling to work outside the City.
The City's population estimate as of April 1,2014 was 24,388. Chanhassen's residentia]permits were
approximately the same in 2014 as compared to 2013. In 2014,there were 159 residential pe3•mits as coinpared to
168 in 2013. The total value of all building permits and plan checks in 2014 was$80,591,94L The City
anticipates a two percent growth rate for residential permits.
The City is working with a developer on a 118 acre Lifestyle Center and office/industrial land use is in delnand.
The City anticipates two industrial developments in 2015 of approximately 60 acres.
The City did not issue debt in 2014,however as the financial statements will indicate the City maintained strong
financial reseives and continues its pracrice of utilizing multiple long tenn financial planning documents.
Accounting System and Budgetai^v Control
The City's accounting recards are maintained on tlle accrual,or modified accrual basis,as appropr•iate. Budgetary
control is maintained through the City's accounting and reporting system whereby monthly detail r•eports of budget
ve��sus actual are provided to all departments with summaries being provided to the City Council. Approval
lisrings and documentation are provided for the City Council at each semi-monthly meeting foi•all checks issued
by the City.
In the City's accounting system,careful consideration is given to the adequacy of internal controls. These controls
at•e designed to pr•ovide r•easonable,but not necessarily absolute,assurance regai•ding: (1)the safeguarding of
assets against loss from unauthorized use or disposition and(2)the reliability of financial records for preparing
financial stateinents and maintaining accountability foi•assets. The concept of reasonable assurance recognizes
that: (1)the cost of control should not exceed the benefits likely to be derived and(2)the evaluation of costs and
benefits requires estimates and judgments by management. All internal control evaluation occui•s within the above
framework. We believe the City's internal controls adequately safeguard assets and provide reasonable assurance
of proper recording of financial transactions.
Capital financings far majar municipal improvements are provided through(1)improvement bonds,(2)general
obligation bonds,(3)tax increment bonds,or(4)revenue bonds. Internal financing of improvement projects is
usually minimal and only for short periods of time.
4
Long Term Fifza�zcial Planraing �I
]n 2002,the City undet•took an extensive long term financial planning process called"Key Financial Strategies".
As a part of this process the City developed a long term(5 yeai•s)general fund budgeting model. In addition the
City developed annual strategies and�neasur•ement tools,both financial and non-financial,to compare our results
from year to year and with other like communities in our area.
Tl�ese strategies and the long teim general fund budget are updated on an annual basis as part of our goal setting
strategies at the beginning of each year. In a�ddition,the City has a 5 year capital improvement plan in place for
infrastructure and equipment,as well as a pavement management plan in place for streets.
The City also undertakes an annual rate study of its Water, Sanitaiy Sewer,and Storm Water rates. As part of this
process the City projects fund balances and capital improvements to each of the systems for the next twenty years,
and the projected user and connection rates needed for each fund for tl�at same time period.
Certi.ficate ofAcltieveme�at
The Govei•nment Finance Officers Association of the United States and Cauada(GFOA)awarded a Certificate of
Achievement for Excellence in Financial Reporting to the City of Chanhassen for its comprellensive annual
financial report(CAFR)for the�scal year ended December 31,2013. The Ce�tificate of Achievement is a
prestigious national award recognizing conformance with the highest standards for preparation of state and local
govermnent financial reports.
In order to be awarded a Certificate of Achievement,a govei��mental unit must publish an easily 3•eadable and
efficiently organized comprehensive annual financial report,whose contents confojm to program standards. The
CAFR must satisfy both generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year•only. The City of Chanhassen has received a
Certificate of Achievement fol•the last twenty two consecutive yeals(fiscal years ended 1992—2013).We believe
oul•cui�•ent i•eport continues to conform to the Certificate of Achievement program r•equirements and we are
submitting it to GFOA to detennine its eligibility for another certificate.
Indeperrdent Audit
State law provides that the City inay arrange for examination of its books,l•ecords,accounts and affairs,or any
part thereof,by the State Auditor,or by Certified Public Accountants. It has been a long-standing policy of the
City to pr•ovide for a complete annual audit of City records by Certified Public Accountants. The auditor's opinion
has been included in this report.
AcknoN�ledgments
We wish to express our appreciation to the membei•s of the City Council for their support in iinproving the
financial condition of the City. We also want to thank the Finance Department staff and department directors far
their assistance in compiling the info37nation necessary for this report. Finally,we wish to acknowledge Redpath
and Company,Ltd.for their assistance in preparing this report.
Respectfully submitted,
Greg Sticha,Finance Director
5
Government Finance Officers Association
Certifica�� of
Achievernent
fo� Excell�nce
in Finan�ial
Reporting
Presented to
City of Chanhassen
Minnesota
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
December 31, 2013
����� ����
Executive Director/CEO
6
�
City of Chanhassen, Minnesota
Organization Chart
Citizens
Environmental Senior
Cominission Cominission
Planning ark&Recreation
Coinmission Mayo�'-Council Cominission
Economic
Development
Authority
Adnunistration
Law
Finance Enforcement Public Community Parks and
& Fire Works Development Recreation
Administration
7
CITY OF CHANHASSEN,MINNESOTA
ORGANIZATION
Decembei•31,2014
Term Expires '
Mayor: I�
Tom Furlong 12/31/14
Council Meinbers:
Bethany Tjor•nhom 12/31/16
Vicki Ernst 12/3ll14
Jerry McDonald 12/31/16
Denny Laufenburger 12/31/14
City Manager:
Todd Gerhardt Appointed
Finance Directot•:
Greg Sticha Appointed
Community Development Director:
Kathiyn Aanenson Appointed
Public Works Director/City Engineer:
Paul Oehine Appointed
Parks and Recreation Director:
Todd Hoffman Appointed
8
II. FINANCIAL SECTION
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10
t �� ,. . ����_.�n_��
ANu cor,� � Ar� v
1NDEPENDENT AUDITOR'S REPORT
To the Honorable Mayor and
Members of the City Council
City of Chanhassen, Minnesota
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the
business-type activities, each major fund and the aggregate r•emaining fund information of the City
of Chanhassen, Minnesota, as of and for the year ended December•31, 2014, and the related notes to
the financial statements, which collectively coinprise the City of Chanhassen, Minnesota's basic
financial statements as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accor•dance with accounting principles generally accepted in the United States of America; this
includes the design, iinplementation, and maintenance of internal control relevant to the preparation
and fair presentation of financial statements that are free from material misstatement, whether•due
to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We
conducted our audit in accor•dance with auditing standards generally accepted in the United States
of America and the standards applicable to financial audits contained in Governmeszt Auditing
Standards, issued by the Comptroller General of the United States. Those standards require that we
plan and pei•fonn the audit to obtain i•easonable assurance about whether the financial statements
are fi•ee from material misstatement.
An audit involves perfot7ning procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on the auditor's judgment,
including the assessment of the risks of material misstatement of the financial statements, whether
due to fraud or er7•or. In making those r•isk assessments, the auditor considers internal control
relevant to the entity's prepai•ation and fair pr•esentation of the financial statements in order to
design audit procedur•es that are appropriate in the circumstances, but not for the puipose of
expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express
no such opinion. An audit also includes evaluating the appr•opr•iateness of accounting policies used
and the reasonableness of significant accounting estimates made by management, as well as
evaluating the over•all presentation of the financial statements.
4810 White Bear Parkway, St. Paul, MN, 55110 651.426.7000 www.redpathcpas.com
11
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for•our audit opinions.
Opinions
In our opinion, the �nancial statements i•eferred to above present fairly, in all material respects, the
respective financial position of the gove�nmental activities, the business-type activities, each major• �
fund and the aggregate remaining fund information of the City of Chanhassen, Minnesota, as of
December 31, 2014, and the respective changes in financial position, and, where applicable, cash ��
flows thereof for the year then ended in accordance with accounting principles generally accepted
in the United States of America. !,
Report on Summarized Comparative Information �
We have previously audited the City of Chanhassen, Minnesota's 2013 financial statements, and we ��
expressed an unmodified audit opinion on the respective financial statements of the goverYunental
activities, the business-type activities, each major fund and the aggr•egate remaining fund
information in our report dated May 27, 2014. In our opinion, the summarized comparative
information presented herein as of and for the year ended December 31, 2013 is consistent, in all
material respects, with the audited financial statements from which it has been derived.
Other Matters
Required Suppleineiitary Information
Accounting principles generally accepted in the United States of America i•equire that the
management's discussion and analysis, the budgetaiy comparison information and the schedule of
funding progress, as listed in the table of contents, be presented to supplement the basic financial
statements. Such information, although not a part of the basic �inancial statements, is required by
the Govei�nental Accounting Standards Board, who consideis it to be an essential part of financial
reporting for placing the basic financial statements in an appi•opriate operational, economic, or•
historical context. We have applied certain limited procedures to the r•equired supplementary
infor7nation in accordance with auditing standar•ds generally accepted in the United States of
America, which consisted of inquir•ies of management about the methods of preparing the
information and comparing the information for consistency with manageinent's responses to our
inquiries, the basic financial statements, and other knowledge we obtained during our audit of the
basic financial statements. We do not express an opinion or provide any assurance on the
information because the limited procedures do not provide us with sufficient evidence to express an
opinion or provide any assurance.
Other InfoNmation
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the City of Chanhassen, Minnesota's basic financial statements. The
introductoiy section, combining and individual nonmajor fund financial statements and schedules,
statistical section and other infoi�nation, are presented for•puiposes of additional analysis and are
not a requu•ed pai-t of the basic financial statements.
12
The combining and individual nonmajor fund financial statements and schedules are the
responsibility of management and were derived fi•om and relate directly to the underlying
accounting and other records used to prepar•e the basic financial stateinents. Such information has
been subjected to the auditing procedures applied in the audit of the basic financial statements and
certain additional procedures, including coinparing and reconciling such infoi-mation directly to the
underlying accounting and other records used to prepare the basic financial statements or•to the
basic financial statements themselves, and other additional pr•ocedures in accordance with auditing
standards gener•ally accepted in the United States of America. In our opinion, the combining and
individual nonmajor fund financial statements and schedules are fairly stated in all material respects I
in relation to the basic financial statements as a whole.
The intr•oductoiy section, statistical section and other information have not been subjected to the
auditing procedures applied in the audit of the basic financial statements and, accordingly, we do
not express an opinion or•provide any assui•ance on them.
Other Reporting Required by GovernmentAuditing Standards
In accordance with Goverfzment Auditing Standards, we have also issued ou1•i•eport dated May 19,
2015, on out•consideration of the City of Chanhassen, Minnesota's internal control over financial
reporting and on our tests of its compliance with cei•tain provisions of laws, i•egulations, cont�•acts,
and grant agreements and other matters. The puipose of that report is to describe the scope of our
testing of internal control over financial reporting and compliance and the r•esults of that testing,
and not to provide an opinion on internal contr•ol over financial reporting or on compliance. That
r•eport is an integral part of an audit performed in accordance with Government Auditing Standcz�ds
in considel�ing the City of Chanhassen, Minnesota's internal control over financial reporting and
coinpliance.
����� �--���;��-� �� .
REDPATH AND COMPANY, LTD.
St. Paul, Minnesota
May 19, 2015
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MANAGEMENT'S DISCUSSION AND ANALYSIS
As management of the City of Chanhassen, Minnesota (the City), we offer readers of the City's
financial statements this nan�ative overview and analysis of the financial activities of the City for
the fiscal year ended December 31, 2014. We encour•age readers to consider the infoi7nation
presented here in conjunction with additional infotmation that we have furnished in our letter of
transmittal, which can be found in the introductoiy section of this repor-t.
Financial Hi�hlights
The assets of the City eXceeded its liabilities at the close of the most i•ecent fiscal year by
$156,659,100 (net position). Of this amount, $24,344,973 (unrestricted net position)may be
used to ineet the City's ongoing obligations to citizens and creditors in accoi•dance with the
City's fund designations and fiscal policies.
The City's total net position decreased by $2,083,670.
As of the close of the current fiscal year, governmental funds reported combined ending fund
balances of$18,099,214. Of this amount, $5,724,419 is restricted by external constraints
established by cr•editors, grantors, cont�-ibutors, or by state statutoiy provisions.
At the end of the cus7•ent fiscal year, the General Fund had a fund balance of$5,609,065. Of that
amount, $58,333 was in a nonspendable form and the remaining $5,550,732 was unassigned.
Total debt decreased by $10,469,026 during the cui7•ent fiscal year, fi•om $32,404,287 to
$21,935,261. The City did not issue debt during 2014.
Overview of the Financial Statements
The management's discussion and analysis is intended to serve as an introduction to the City's
basic financial statements, which are comprised of three components: 1) gover-nment-wide
financial statements, 2) fund financial statements, and 3) notes to the financial statements. This
report also contains other supplementaiy information in addition to the basic financial statements
themselves.
Government-wide financial statements. The government-wide financial statements are
designed to provide readers with a broad overview of tlle City's �nances, in a manner similar to
a private-sector business.
15
Management's Discussion and Analysis
The statement of net position presents information on all of the City's assets and liabilities, with
the difference between the two reported as net position. Over time, increases or decreases in net
position may seive as a useful indicator of whether the financial position of the City is improving
or deteriorating.
The statement of activities presents information showing how net position changed during the ,
most recent�scal year•. All changes in net position are reported as soon as the underlying event ',
giving rise to the change occurs, regar•dless of the timing of related cash flows. Thus, revenues �'�
and expenses are reported in this statement for some items that will only result in cash flows in
future fiscal periods (e.g. uncollected taxes, and earned but unused vacation leave).
Both of the government-wide financial statements distinguish functions of the City that are
principally supported by taxes and intergovernmental revenues (govermnental activities) fi-om
other functions that are intended to recover all or a significant portion of their costs through user•
fees and char�es (business-type activities). The govelmmental activities of the City include
general gover-nment, public safety, public works,parks and recreation, and community
development. The business-type activities include water, sewer, and sur•face water management.
The government-wide financial statements can be found on Statements 1 and 2 of this report.
Fund Financial statements. A fund is a grouping of related accounts that is used to maintain
control over resources that have been segregated far•specific activities or objectives. The City,
like other� state and local governments, uses fund accounting to ensure and demonstrate
compliance with finance-related legal requi�•ements. All of the funds can be divided into three
categor•ies: governmental funds,proprietaiy funds, and fiduciaiy funds.
Governmental funds. Governmental funds are used to account for essentially the same
functions reported as governmental activities in the government-wide financial statements.
However, unlike the government-wide financial statements, governmental fund financial
statements focus on near-ter-m inflows and outflows of spendable resoui•ces, as well as on
balances of spendable resources available at the end of the fiscal year. Such information may be
useful in evaluating a government's near-term financial requirements.
Because the focus of goverrunental funds is nar�•ower than that of the government-wide financial
statements, it is useful to compare the information presented for governmental funds with similal•
infoimation presented for governmental activities in the government-wide financial statements.
By doing so, readers may better undeistand the long-term impact of the City's near-term financial
decisions. Both the governmental fund balance sheet and governmental fund statement of
revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this
comparison between govet�nental funds and governmental activities.
I6
—
Management's Discussion and Analysis
The City maintains five individual majoi•governinental funds. Information is pr•esented
separately in the govei�runental fund balance sheet and in the governmental fund statement of
r•evenues, expenditures, and changes in fund balances for the following major funds:
• General Fund
• 2009A G.O. Refunding Bonds
• Transit Station Assessment Fund
• Revolving Assessrnent Fund
• TH101 Improvements—Lyinan to Pioneer
Data from the other governmental funds are combined into a single, aggregated presentation.
Individual fund data for each of these noninajor governmental funds is provided in the form of
combining statements elsewhere in this report.
The City adopts an annual appr•opriated budget foi•the General Fund and for•the Contribution
and CATV special revenue funds. A budgetary comparison statement has been provided for•
those funds to demonstrate compliance with this budget.
The basic goveinrriental fund financial statements can be found on Statements 3 tlu•ough 5 of this
repor-t.
Propi•ietary funds. The City maintains three enterprise funds as a part of its proprietary fund
type. Enterprise funds are used to report the same functions presented as business-type activities
in the gover-nment-wide financial statements.
Proprietaiy funds provide the same type of information as the govei�unent-wide financial
statements, only in more detail. The proprietaiy fund financial statements provide separate
infoi7nation for the following funds:
• Water
• Sewer
• Surface Water Management
The basic propr•ietary fund financial statements can be found on Statements 6 tlu•ough 8 of this
report.
Fiduciary funds. Fiduciaiy funds at•e used to account for resources held foi�benefit of parties
outside the government. Fiduciaiy funds are not r•eflected in the govet�unent-wide financial
statements because the resources of those funds are not available to support the City's own
programs. The accounting used for fiduciary funds is much like that used for propr•ietaiy funds.
The basic fiduciary fund financial statement can be found on Statement 9 of this i•eport.
17
Management's Discussion and Analysis
Notes to the�nancial statements. The notes provide additional infoimation that is essential to
a full understanding of the data provided in the government-wide and fund financial statements.
The notes to the financial statements can be found following Statement 9 of this report.
Other information. The combining statements referred to earlier in connection with non-major j
governmental funds are pr•esented immediately following the required supplementary
infor7nation on budgetary comparisons. Combining and individual fund financial statements and
schedules can be found on Statement 11 through 22 of this report.
Government-Wide Financial Analysis
As noted earlier, net assets may serve over time as a useful indicatol•of a government's financial
position. Assets exceeded liabilities by $156,659,100 at the close of the most recent fiscal year.
The largest portion of the City's net position ($125,978,680 or 80%)reflects its net investment in
capital assets (e.g. land, buildings, machinery, and equipment) less any related debt used to
acquire those assets that is still outstanding. The City uses these capital assets to provide
seivices to citizens; consequently, these assets are not available for•future spending. Although
the City's investment in its capital assets is reported net of related debt, it should be noted that
the resources needed to repay this debt must be provided from other•sources, since the capital
assets theinselves cannot be used to liquidate these liabilities.
City of Chanhassen,Minnesota's Net Position
Govermnental Activities Business-Type Activities Totals
2014 2013 2014 2013 2014 2013
Assets:
Currentandotherassets $24,263,44] $28,120,653 $12,178,258 $17,060,623 $36,441,699 �45,181,276
Capital assets 83,590,483 86,805,310 63,026,869 64,073,290 146,617,352 150,878,600
Totalassets �107,853,924 $114,925,963 $75,205,127 $87,133,913 �183,059,05] $796,059,876
Liabilities:
Long-tennliabilitiesoutstanding $12,707,168 $16,894,02] $10,218,055 �16,485,291 $22,925,223 $33,379,312
Other liabilities 3,066,465 3,221,961 408,263 715,833 3,474,728 3,937,794
Totalliabilities $15,773,633 $20,175,982 $10,626,318 $]7,201,124 $26,399,951 $37,317,106
Net position:
Netinvesnnentincapitalassets $71,867,072 $71,260,946 $54,111,608 $52,541,451 $125,978,680 $123,802,397
Resh�icted 6,335,447 9,824,330 - - 6,335,447 9,824,330
Um�esh�icted 13,877,772 13,724,705 ]0,467,20] ll,391,338 24,344,973 25,ll6,043
Totalnetposition $92,080,291 $94,809,981 $64,578,809 $63,932,789 $156,659,100 $158,742,770
18
Management's Discussion and Analysis
$6,335,447 of the City's net position repr•esents resoui•ces that ai•e subject to extei-nal restrictions
on how they may be used. The remaining balance of uru•estricted net position($24,344,973) may
be used to meet ongoing obligations to citizens and creditors.
At the end of the cun•ent fiscal year, the City is able to report positive balances in all three
categories of net position,both for the City as a whole, as well as for its separate govei•nmental
and business-type activities.
Governmental Activities
Total net position of the goveinmental activities decreased $2,729,690, or 3%. The components
of net position increased or decreased as follows:
• Net investment in capital assets increased $606,126 due to deci•eases in debt related to
capital assets exceeding decreases in capital asset balances.
• Restricted net position decreased $3,488,883. This decrease is primarily due to decreases
in amounts rest�•icted for debt seivice (a $3.5 million pr•incipal payment was made on the
2009A G.O. Refunding Bond) and amounts restricted for tax increment(TIF#8
Presbyter•ian Hoines with a $570,000 balance was decertified).
• Unrestricted net position increased $153,067, or 1%. This relatively minor incr•ease
occurred due to a variety of reasons.
19
Management's Discussion and Analysis
Business-Type Activities '
The net position of the City's business-type activities increased by $646,020, or 1%, primarily
because capital contributions such as contributed capital assets and connection charges exceeded
operating losses. Net investment in capital assets increased $1,570,157 while um•estricted net
position decreased $924,137. This occurred because uru•estr•icted assets were used to pay off
� $1,575,000 of water revenue bonds (capital related debt) ahead of the scheduled due dates.
City of Chanhassen, Minnesota's Changes in Net Position
Governmenta]Activities Business-Type Activities Totals
2014 2073 2014 2013 2014 2013
Revenues:
Program revenues:
Charges forservices $2,941,522 $3,609,822 $5,684,650 $5,803,976 $8,626,172 $9,413,798
Operatin�grants and conhibutions 532,337 472,298 210,857 63,ll2 743,194 535,410
Capitalgrantsand conhibutions 3,296,748 ]0,718,999 2,633,793 2,852,437 5,930,541 ]3,571,436
General revenues:
Propertytaxes ]0,482,273 ]0,059,324 - - 10,482,273 10,059,324
Tax increment collections 307,940 545,906 - - 307,940 545,906
Grants and contributions not
reshicted to specific p�rograms 19,736 19,941 - - 19,736 79,941
Unrest�ictedinvesrinent ear'nings 183,602 (14,764) ]34,533 (776) 318,135 (15,540)
Special item-sale of public works building - - - - - -
Gain on sale of capital assets 191,755 37,720 - - 191,755 37,720
Total revenues ]7,955,913 25,449,246 8,663,833 8,718,749 26,619,746 34,167,995
Expenses:
General government 3,099,004 2,630,405 - - 3,099,004 2,630,405
Public safety 3,416,088 3,313,694 - - 3,416,088 3,313,694
Public works 9,604,525 14,224,453 - - 9,60a,525 14,224,453
Parks and recreation 3,062,592 2,919,183 - - 3,062,592 2,919,183
Community development 1,043,848 523,651 - - 1,043,848 523,651
Interest on long-te�m debt 465,935 588,352 - - 465,935 588,352
Water - - 3,347,965 4,702,686 3,347,965 4,702,686
Sewer - - 3,171,696 3,548,200 3,171,696 3,548,200
Surfaee water management - - 1,491,763 1,334,173 1,491,763 1,334,173
Total expenses 20,691,992 24,199,738 8,011,424 9,585,059 28,703,416 33,784,797
]ncrease(dcereasc)in net position befor�e h�ansfers (2,736,079) 1,249,508 652,409 (866,310) (2,083,670) 383,198
Transfers 6,389 307,596 (6,389) (307,596) - -
Change in net position (2,�29,690) 1,557,104 646,020 (],173,906) (2,083,670) 383,198
Net position-beginning 94,809,981 93,252,877 63,932,789 65,106,695 158,742,770 ]58,359,572
Net position-ending $92,080,291 $94,809,981 $64,578,809 $63,932,789 $156,659,100 $158,742,770
2�
Management's Discussion and Analysis
Governmental Activities
Revenues
Revenues for the governmental activities decreased by $7,493,333, or 29%. Capital grants and
contributions decreased by $7,422,251 as compared to 2013 due to improvements made to TH
101 at Pleasant View Road and Lyman Boulevard to Pioneer Trail (approximately $5.2 million).
In addition, there was $2.1 million less in special assessment collections as compared to the
previous year.
Expeszses
Expenses for the goveininental activities decreased by $3,507,746, os• 14%. The decrease is
lar•gely due to the same project noted above (TH 101, from Lyman Boulevard to Pioneer Trail).
Below are specific graphs which provide compar•isons of the governmental activities revenues
and expenses:
� I
Governmental Activities-Revenues II
Propertytaxes '',
58.4%
i� 1
.1
i
( :�i
_
x
i
i I �I I .1
Capital grants and � { i ' I
contributions � . .�'��� '�.i,� �� I �
18.4% i
,� ��Y#�'� X�� i
_ �
��� �Tax increment collections
Operetinggrantsand� �� 1.7/
contribuYions
3.0% Other
2.1%
' Charges for services
� 16.4%
� . - — --- – --
2�
Management's Discussion and Analysis �,
_--- — __- - �
�'�� Interest on long-term debt � �i
z 3� Governmental Activities-Expenses
�� Community development^
�� 5.0% �
General govemment ��
15.0%
Parks and recreation II
14.8%
� I
. ���y�' III
� II
`p ry �Public safety
[. � 16.5% I'�,
�
I ti" -
I �.'
I �- �
��j I
Public works �'
46.4% s�r.�'-=+ � "" '
Business-Tvpe Activities
Revenues
Revenues for the business-type activities decreased by $54,916, or 1%. The1•e were no
significant items that contributed to this decrease.
Expenses
Expenses for business-type activities decreased by $1,573,635, or 16%. The majority of the
decrease was due to the purchase and installation of new radio read units for the City's utility
billing system during 2013.
22
Management's Discussion and Analysis
Below are specific graphs showing the business-type activities revenue and expense
comparisons:
i Unrestricted investment BuSiness-Tppe ACtivitieS-Revenue �
earnings
� 1.6%
��"�y I
� �. .
Capi[al graMs and contributions . =�,�r,�''�� -'t��� �
0.4% �-&s^'S�'- �
��� � I
��� � � �
, i � . ..��'t�z '�$ � .f . � �
. /J � b�.'�� ` s �������� g ... � .
,s �
. . �����a#��� �
� �� � a�� r �'� � �,,
nz z�-�.-
t
���_•'`.-��`dy`�s�-�i '�F -.� ��` I �',
l��F � � I
�(FK
�� �� �� Xi�. 'y e6 -� :l
. 5:�� �; . �il
1 . . �k X •s� �,�� I
� p� I
II M1£v.
_
I �4
Charges for services
Operating grants and� 65.6%
contributions
2.4%
�5... _____ __...._ , .._..._ . _..._--___.__.._ _�_ . . ..... .. ...
Business-Type Activities-Expenses
Surface water management^
18.6% \
`t
f '.;•
�
� � � � Water
I '41.8%
I .
�:'':r
Sewer�
39.6%
� —__._.__._.— __ __. ___.�_.___
2,J
Management's Discussion and Analysis
Financial Analysis of the Government's Funds
Governmental Funds. The focus of the City's gover•nmental funds is to provide information on
near-term inflows, outflows, and balances of spendable resources. Such information is useful in
assessing the City's financing requi�•ements. In particular, uru•estricted fund balance may serve
as a useful measure of a government's net resources available foi� spending at the end of the
fiscal year.
At tbe end of the current fiscal year, the City's governmental funds t•eported combined ending
fund balances of$18,099,214. Approximately 32% of this total amount($5,724,419) constitutes
fund balance restr•icted by external const�•aints established by creditors, gr•antors, cont�•ibutoi•s, or
by state statutory provisions. $1,347,908 of fund balance is not in a spendable form, $5,951,507
has been assigned, and $5,075,380 is unassigned.
The General Fund balance increased by $317,740 in 2014. The increase in fund balance was
attributable to additional revenues not budgeted for as follows: excess tax inci•ement of
$130,000, building permit revenue exceeding budget by $260,000 and a land sale of$280,000.
The 2009A G.O. Refunding Bonds debt service fund balance decreased by $3,192,717 due to a
$3.5 million bond payment made in 2014.
The Transit Station Assessment Fund balance increased by $92,582 due to the collection of
special assessments. These collections allowed the fund to pay $92,582 towards an interfund
loan owed to the Water Fund.
The Revolving Assessment Fund balance decreased by $146,082. The majority of the decrease
is due to a slightly larger street reconstruction project as compared to previous years.
The TH101 Improvements—Lyman to Pioneer Fund balance decreased by $479,781 due to
expending project funds which were tr-ansferred into the fund during 2013.
The nonmajor special i•evenue funds incr•eased by $109,396 in 2014. This increase was primarily
due to the creation of a Cemetery Fund and Cable TV fi•anchise fee revenues exceeding
expenses.
The nonmajor debt seivice funds increased by $25,492 in 2014. There were no significant items
that accounted for this increase.
The nonmajor capital project funds decreased by $233,816. This decrease was due to the closing
and decerti�cation of TIF District#8 (Presbyterian Homes).
24
Management's Discussion and Analysis
Pi•oprietary funds. The City's proprietaiy funds provide the same type of information found in ���
the government-wide financial statements, but in more detail.
The unreshicted net position in the r•espective proprietaiy funds is $5,091,624 (Water),
$4,216,593 (Sewer) and$1,158,984 (Surface Watei•Management). The Water Fund had an
increase in net position in 2014 of$838,796 due to capital cont�-ibutions such as capital assets
and connection charges exceeding operating losses. The Sewer and Surface Water Management
Funds each had a decrease in net position in 2014 of$60,264 and $132,512, respectively.
Bud�etary Highlights
General Fund
There were no budget amendments to the General Fund in 2014.
Budgetary Variaraces—Revenues
The positive General Fund revenue variance of$538,063 was mostly due to excess tax increment
of$130,000, building permit revenue exceeding budget by $260,000 and a land sale of$280,000.
Budgetary Variances—Expenses
Expenses for the General Fund had a negative variance of$58,060. The variance was less than
.6% of the entire Gener•al Fund budget. This insignificant variance was primarily due to large
snow events in early 2014.
25
Management's Discussion and Analysis
Capital Asset and Debt Administration �I
Capital assets. The City's investment in capital assets for•its governmental and business-type
activities as of December 31, 2014, amounts to $146,617,352 (net of accumulated depl•eciation).
This investment in capital assets includes land,buildings, infrastiucture, machinery, and
equipment.
City of Chanhassen, Minnesota's Capital Assets
(Net of Depreciation)
Beginning Ending
Primarv Government Balance Increase Decrease Balance
Governmental activities:
Capital assets not being depreeiated:
Land $19,792,789 $ - ($535,972) $19,256,817
Constructioninprogress 1,961,177 1,690,948 (1,007,674) 2,644,451
Permanent easements 922,670 233,280 - 1,155,950
Total capital assets not being depreciated 22,676,636 1,924,228 (1,543,646) 23,057,218
Capital assets being depreciated:
Buildings and sn•uctures 22,858,759 7,115 - 22,865,874
Mael�inery and equipinent 8,308,887 474,046 (238,300) 8,544,633
Te�nporary easements 12,931 - - 12,93]
Otherimprovements 6,680,735 476,883 - 7,157,618
Infrastructure 112,664,246 479,114 - 113,143,360
Total capital assets being depreciated 150,525,558 1,437,158 (238,300) 151,724,416
Less accumulated depreciation for:
Buildings and sriuctures 6,149,264 559,807 - 6,709,071
Machinery and equipment 5,721,355 477,023 (178,640) 6,019,738
Temporaiy easements 6,017 6,915 - 12,932
Other iiuprovements 2,669,326 286,930 - 2,956,256
Infrastructure 71,850,922 3,642,232 - 75,493,154
Total accumulated depreciation 86,396,884 4,972,907 (178,640) 91,191,151
Govermnental activities capital assets-net $86,805,310 ($1,611,521) ($],603,306) $83,590,483
26
Management's Discussion and Analysis
Beginning Ending
Primary Government Balance Increase Decrease Balance
Business-type activides:
Capital assets not being depreciated:
Land $2,072,635 $4,400 $ - $2,077,035
� Consu•uction in progress 2,698,816 1,152,250 (2,250,84A) 1,600,222
Permanent easements 835,483 320,984 - 1,156,467
Total capital assets not being depreciated 5,606,934 1,477,634 (2,250,844) 4,833,724
Capital assets being depreciated:
Buildings and structures 12,445,429 - - 12,445,429
Machine�y and equipment 1,419,697 138,983 (39,006) 1,519,674
Temporaty easements 34,728 - (34,728) -
Otherimprovements ]01,611,932 2,865,587 (35,955) 104,441,564
Total capital assets being depreciated ll5,511,786 3,004,570 (]09,689) ]18,406,667
Less accumulated depreciation for:
Buildings and structures 1,494,163 248,918 - 1,743,08]
Macl�ineiy and equipment 924,172 79,045 (33,449) 969,768
Temporary easements 34,728 - (34,728) -
Otl�er improvements 54,592,367 2,944,261 (35,955) 57,500,673
Total accumulated depreciation 57,045,430 3,272,224 (104,132) 60,213,522
Business-type activities capital assets-net 64,073,290 1,209,980 (2,256,401) 63,026,869
Total capital assets-net $150,878,600 ($�401,541) ($3,859,707) $146,617,352
Additional infor�mation on the City's capital assets can be found in Note 5.
Governmental Activities Capital Assets. There was a decrease in capital assets due to the
reduction in depr•eciable assets (cur�•ent year•depreciation expense exceeded current year
additions).
Business-Type Activities Capital Assets. Ther•e was a decrease in capital assets due to the
reduction in depreciable assets (cui7•ent year depreciation expense exceeded cui7•ent year
additions).
Long-term debt. At the end of the current fiscal year, the City had total bonds payable
outstanding of$21,935,261, a decrease of$10,469,026 from 2013. The majority of the decrease
was due to the City making a large payment of$3.5 million towards the 2009A G.O. Refunding
Bonds. In addition, the 2004B Water Revenue Bonds had $3.575 million in cash from escr•ow
used to defease the old debt issuance, as well as an additional $1.575 million in funds to pay off
all remaining principal and interest related to the debt.
The balance of the bonds payable outstanding is comprised of$9,550,000 in general obligation
bonds, $1,705,000 for special assessment debt which is suppoi�ted in part by special assessments,
$9,905,000 of revenue bonds which financed capital investments for the water, sewer, and
surface water management operations, $635,000 in tax inereinent bonds and an unamortized
bond pr•emium of$140,261.
27
' �
Management s Discussion and Analysis
Additional long-term debt in the amount of$964,431 for compensated absences was also
outstanding at the end of 2014.
City of Chanhassen, Minnesota's Outstanding Debt
Governmental Actrvities Business-Type Activities Totals
2014 2013 2014 2013 2014 2013
General obligation bonds $9,550,000 $10,155,000 $ - $ - $9,550,000 $10,155,000
Revenue bonds - - 9,905,000 16,170,000 9,905,000 16,170,000
Taxincrernentbonds 635,000 705,000 - - 635,000 705,000
Generalimprove�nentbonds 1,705,000 5,220,000 - - 1,705,000 5,220,000
Bond premium - - 140,261 154,287 140,261 154,287
Compensated absences 791,637 794,233 172,794 161,004 96�},43] 955,237
Total $12,681,637 $16,874,233 $10,218,055 $16,485,291 $22,899,692 $33,359,524
The City did not issue debt in 2014. However as the financial statements will indicate, the City
maintained st�•ong financial reserves and continues its practice of utilizing multiple long term
financial planning documents. The City's bond rating had previously been reaffir•med in 2012 by
Standard & Poor's when the City issued the G.O. Water and Sewer Revenue Bonds of 2012A.
The City of Chanhassen is one of approximately 15 communities in the State of Minnesota to
have an AAA bond rating fi•om either Standard & Poor's o1•Moody's.
State statutes limit the amount of general obligation debt a Minnesota city may issue to 3% of the
total estimated market value. The cutrent debt limitation for the City is $98,838,150. Of the
City's outstanding debt, $8,030,953 is counted within the statutoiy limitation.
Additional information on the City's long-term debt can be found in Note 6.
Requests for Information. This financial report is designed to pi•ovide a general oveiview of
the City of Chanhassen, Minnesota's finances for all those with an inter•est in the govei•nment's
finances. Questions concer-ning any of the information provided in this report or requests for
additional financial infoimation should be addr•essed to the Director of Finance, 7700 Market
Bouleval�d, P.O. Box 147, Chanhassen, Minnesota 55317.
28
BASIC FINANCIAL STATEMENTS
29
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30
CITY OF CHANHASSEN,MINNESOTA
STATEMENT OF NET POSITION Statement 1
December 31,2014
With Compa3•ative Totals For December 31,2013
Primajy Govei7iment
Governmental Business-Type Totals
Assets: Activities Activities 2014 2013
Cash and investments $18,543,927 $10,223,079 $28,767,006 $32,663,984
Cash with escrow agent - - - 3,670,439
Accf•ued interest receivable 72,151 48,714 120,865 118,338
Due fi•om other governmental units 1,218,063 104,585 1,322,648 2,280,276
Accounts receivable-net 138,360 1,115,369 1,253,729 1,288,312
P3•ope3-ty taxes receivable 164,003 - 164,003 154,009
Prepaid ite3ns 60,333 12,351 72,684 18,313
Inventories-at cost - 36,322 36,322 45,277
Internal balances (466,933) 466,933 - -
Contj•act for deed receivable 1,327,053 - 1,327,053 1,372,668
Special assessments receivable 3,206,484 170,905 3,377,389 3,569,660
Capital assets(net of accumulated depreciation):
Nondepreciable 23,057,218 4,833,724 27,890,942 28,283,570
Depreciable 60,533,265 58,193,145 118,726,410 122,595,030
Total assets 107,853,924 75,205,127 183,059,051 196,059,876
Liabilities:
Accountspayable 440,413 131,601 572,014 646,203
Due to otl�er goveinmental units 34,226 106,704 140,930 134,955
Salaries payable 163,441 34,551 197,992 167,399
Contracts payable 559,341 56,782 616,123 1,274,818
Accrued interest payable 188,949 78,625 267,574 420,229
Unearned revenue 1,680,095 - 1,680,095 1,294,190
Compensated absences payable:
Due within one year 86,173 18,810 104,983 65,952
Due in more than one year 705,464 153,984 859,448 889,285
Other post e�nployment benefits payable:
Due in more than one year 25,531 - 25,531 19,788
Bonds payable:
Due within one year 1,250,000 789,026 2,039,026 8,894,026
Due in more than one year• 10,640,000 9,256,235 19,896,235 23,510,261
Totalliabilities 15,773,633 10,626,318 26,399,951 37,317,106
Net posirion:
Net investment in capital assets 71,867,072 54,111,608 125,978,680 123,802,397
Restricted for:
Debt seivice 3,441,810 - 3,441,810 6,595,927
Par•k i�nproveinents 1,751,739 - 1,751,739 1,714,972
Tax increinent purposes 965,809 - 965,809 1,347,593
Other pu�poses 176,089 - 176,089 165,838
Um•esri•icted 13,877,772 10,467,201 24,344,973 25,116,043
Total net position $92,080,291 $64,578,809 $156,659,100 $158,742,770
The accompanying notes are an integral pairt of these financial statements. I
31
CITY OF CHANHASSEN MINNESOTA I
�
STATEMENT OF ACTNITIES
For The Year Ended December 31,2014
With Comparative Totals For The Year Ended December 31,2013
Program Revenues
Charges For
Functions/Pro rg ains Expenses Services
Primaiy government:
Governmental acrivities:
General govermnent $3,099,004 $489,237
Public safety 3,416,088 1,327,733
Public works 9,604,525 236,838
Parks and recreation 3,062,592 847,773
Community development 1,043,848 39,941
Interest and fees on long-term debt 465,935 -
Total governmental activities 20,691,992 2,941,522
Business-rype activities:
Water 3,347,965 2,573,027
Sewer 3,171,696 2,472,536
Surface water management 1,491,763 639,087
Total business-type activities 8,011,424 5,684,650
Total primary government $28,703,416 $8,626,172
The accompanying notes are an integral pai�T of these financial statements.
32
Statement 2
Net(Expense)Revenue and ���
Program Revenues Cl�anges in Net Position ,
Operating Capital Primary Government �I
Grants and Grants and Governmental Business-Type Totals i
Contriburions Contributions Activities Activities 2014 2013
�600 � - ($z,do9,16�� $ - (�2>6o9,i6�) ($z,ll�,so4�
391,939 - (1,696,416) - (1,696,416) (1,570,248)
117,908 3,296,748 (5,953,031) - (5,953,031) (2,964,791)
21,s90 - (z,i9z,929� - (z,19z,929� �i,6�1,�s6�
- - (i,003,90�� - (l,003,90�� �4s6,o6g)
- - (465,935) - (465,935) (588,352)
532,337 3,296,748 (13,921,385) 0 (13,921,385) (9,398,619)
1,008 1,508,992 - 735,062 735,062 (370,814)
35,984 579,952 - (83,224) (83,224) (511,651)
173,865 544,849 - (133,962) (133,962) 16,931
210,857 2,633,793 0 517,876 517,876 (865,534)
$743,194 $5,930,541 (13,921,385) 517,876 (13,403,509) (10,264,153)
General revenues:
General property taxes 10,482,273 - 10,482,273 10,059,324
Tax inci-ement collections 307,940 - 307,940 545,906
Grants and contributions not
restricted to specific progr•ams 19,736 - 19,736 19,941
Um�esti•icted investment earnings 183,602 134,533 318,135 (15,540)
Gain on sale of capital assets 191,755 - 191,755 37,720
Transfers 6,389 (6,389) - -
Total genei•al revenues,special item
and transfers 11,191,695 128,144 11,319,839 10,647,351
Change in net position (2,729,690) 646,020 (2,083,670) 383,198
Net position-Januajy 1 94,809,981 63,932,789 158,742,770 158,359,572
Net position-December 31 $92,080,291 $64,578,809 $156,659,100 $158,742,770
The accompanying notes are an integral part of these�nancial statements.
33
CITY OF CHANHASSEN,MINNESOTA
BALANCESHEET
GOVERNMENTALFUNDS
Deceinber 31,2014
With Comparative Totals For December 31,2013 �,
368 2009A G.O. 413 Transit Station
General Fund Refunding Bonds Assessment Fund
Assets:
Cash and invest�nents $5,791,748 $1,292,557 $ -
Accrued intei•est receivable 20,521 6,328 -
Due fi•oin other goveinmenta]units 106,045 - -
Accounts receivable-net 39,246 - -
Due fi•om other funds - - -
Proper-ty taxes receivable 142,828 1,591 -
Prepaid items 58,333 - -
Conh�act for deed receivable - - -
Special assessments receivable 2,001 799,977 556,676
Total assets $6,160,722 $2,100,453 $556,676
Liabilities,Deferred Inflows of Resources,and Fund Balances
Liabilities:
Accounts payable $207,213 $ - $ -
Due to other govermnental units 33,983 - -
Salaries payable 161,848 - -
Contracts payable - - -
Due to other fwids - - -
Interfund loan payable - - 466,933
Unearnedrevenue 74,775 - -
Total liabilities 477,819 0 466,933
Deferred inflows of resources:
Unavailable revenue 73,838 799,977 556,676
Fund balances:
Nonspendable 58,333 - -
Resh•icted - 1,300,476 -
Assigned - - -
Unassigned 5,550,732 - (466,933)
Total fund balances 5,609,065 1,300,476 (466,933)
Total liabilities,defei7•ed inflows
of s•esources,and fund balances $6,160,722 $2,100,453 $556,676
Fund balance reported above
Amounts reported foi•goveinmental activities in the statement of net position are different because:
Capital assets used in governmental activities are not financial resources and therefore are not
reported in the funds.
Other long-term assets are not available to pay for cun•ent period expenditures and therefore are
reported as unavailabe revenue in the funds.
Long-term liabilities,including bonds payable,are not due and payable in the cun•ent period and
therefore are not reported in the funds.
Net position of governmental activities
The accompanying notes are an integr•al part of these financial statements.
34
Statemeut 3 �I
604 TH101
601 Revolving Improvements-
Assessinent Fund Lyman to Pioneei- Other Govt'1 Funds Totals Govermnental Funds
2014 2013
$1,503,002 $ - $9,956,620 $18,543,927 $21,158,901
8,445 2,019 34,838 72,151 73,549
6,209 1,061,746 44,063 1,218,063 2,267,115
- - 99,ll 4 138,360 180,983
545,577 - - 545,577 -
3,023 - 16,561 164,003 154,009
- - 2,000 60,333 16,741
- - 1,327,053 1,327,053 1,372,668
1,757,769 - 90,061 3,206,484 3,456,202
$3,824,025 $1,063,765 $11,570,310 $25,275,951 $28,680,168
$300 $20,754 $212,146 $440,413 $549,212
- 243 - 34,226 27,927
- - 1,593 163,441 139,443
41,810 413,140 104,391 559,341 1,017,910
- 530,627 14,950 545,577 -
- - - 466,933 559,515
- 87,405 1,517,915 1,680,095 1,245,733
42,110 1,052,169 1,850,995 3,890,026 3,539,740
1,760,943 - 95,277 3,286,711 3,534,028
- - 1,289,575 1,347,908 1,343,809
- - 4,423,943 5,724,419 9,181,230
2,020,972 11,596 3,918,939 5,951,507 6,366,292
- - (8,419) 5,075,380 4,715,069
2,020,972 11,596 9,624,038 18,099,214 21,606,400
$3,824,025 $1,063,765 $11,570,310 $25,275,951 $28,680,168
$18,099,214 $21,606,400
83,590,483 86,805,310
3,286,711 3,534,028
�12,a96,i1�> �1�,i3s,�s��
$92,080,291 $94,809,981
The accompanying notes are an integral part of these financial statements.
35
CITY OF CHANHASSEN,iVI1NNESOTA
STATEMENT OF REVENUES,EXPENDITURES AND
CHANGES IN FUND BALANCES
GOVERNMENTALFUNDS
For The Year Ended Decembej•31,2014
With Comparative Totals For The Year Ended December 31,2013
368 2009A G.O. 413 Transit Station '
General Fund Refunding Bonds Assessment Fund !
Revenues: I
General property taxes $7,785,160 $233,800 $ - I
Tax increment collections - - -
Licenses and permits 1,264,263 - -
IntergovernmenYal 373,397 - -
Special assess�nents - 119,059 127,857
Charges for seivices 607,764 - -
Fines and forfeits 100,516 - -
Investment earnings 54,140 16,032 -
Net change in fair value of investinents (1,919) (568) -
Contributions and donations 22,690 - -
Refunds and reimbursements 69,280 - -
Other 191,721 - -
Total i•evenues 10,467,012 368,323 127,857
Expenditures:
Cui7-ent:
General governtnent 2,033,277 5,000 -
Public safety 3,141,772 - -
Public works 2,390,991 - -
Parks and recreation 1,980,862 - -
Cominunity development 440,107 - -
Capital outlay:
General government - - -
Public safety - - -
Public warks - - -
Parks and recreation - - -
Decertification of TIF dish•ict - - -
Debt service:
Principal - 3,515,000 -
lnterest and paying agent fees - 104,325 -
Total expenditw•es 9,987,009 3,624,325 0
Revenues over(under)expenditures 480,003 (3,256,002) 127,857
Other financing sources(uses):
Sale of capital assets 288,547 - -
Transfej•s in - 63,285 -
Transfers out (450,810) - (35,275)
Total other financing sources(uses) (162,263) 63,285 (35,275)
Net change in fund balance 317,740 (3,192,717) 92,582
Fund balance-Januaiy 1 5,291,325 4,493,193 (559,515)
Fund balance-Decembei•31 $5,609,065 $1,300,476 ($466,933)
The accompanying notes are an integral part of these financial statements.
36
Statement 4
604 TH101
601 Revolving Improvements-
Assessment Fund Lyman to Pioneer Other Govt'1 Funds Totals Govermnental Funds
2014 2013
$444,410 $ - $2,025,980 $10,489,350 $10,176,483
- - 307,940 307,940 545,906
- - 427,371 1,691,634 2,113,770
- 1,983,950 195,715 2,553,062 7,971,339
596,335 - 11,715 854,966 3,193,078
- - 190,814 798,578 907,414
- - - 100,516 99,984
22,278 5,328 92,573 190,351 172,964
(790) (189) (3,283) (6,749) (187,728)
- - 44,228 66,918 33,159 �
- - 8,591 77,871 235,363
- - 73,398 265,119 259,703
1,062,233 1,989,089 3,375,042 17,389,556 25,521,435 �,
- - 312,160 2,350,437 2,274,640
- - 116,591 3,258,363 3,179,446
148,445 2,279,156 533,629 5,352,221 10,628,140
25,080 - 158,761 2,164,703 2,002,604
- - 24,180 464,287 522,538
- - 34,080 34,080 87,707
- - 23,980 23,980 74,144
2,204,025 438,912 251,300 2,894,237 2,482,728
10,332 - 474,775 485,107 627,214
- - 569,760 569,760 -
- - 675,000 4,190,000 1,590,000
- - 414,397 518,722 599,487
2,387,882 2,718,068 3,588,613 22,305,897 24,068,648
(1,325,649) (728,979) (213,571) (4,916,341) 1,452,787
- - 12,984 301,531 -
1,179,567 249,198 291,669 1,783,719 888,711
- - �l90,010> �6�d,o9s� �43,9sa>
1,179,567 249,198 114,643 1,409,155 844,723
�i46,os2� �4�9,�si� �9a,928> �3,so�,ig6> z,29�,sio
2,167,054 491,377 9,722,966 21,606,400 19,308,890
$2,020,972 $11,596 $9,624,038 $18,099,214 $21,606,400
The accompanying notes are an integral part of these financial statements.
37
CITY OF CHANHASSEN,MINNESOTA
RECONCILIATION OF THE STATEMENT OP REVENiJES, Statement 5
EXPENDITURES AND CHANGES IN FUND BALANCES OF
GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTNITTES
For Tl�e Year Ended December 31,2014
With Comparative Totals For The Year Ended December 31,2013
2014 2013
Amounts reported fo3•govermnental activities in the ���
stateinent of activities(Statement 2)are diffei•ent because: I
Net changes in fund balances-total governmental funds(Statement 4) ($3,507,186) $2,297,510
Govei7lmental funds report capital outlays as expenditures. However,in the
stateinent of activities the cost of those assets is allocated over their
estimated useful lives and reported as depi•eciation expense. This is the
amount by which capital outlays differ from depreciation in the current period. (1,535,503) (1,763,884)
The net effect of vai•ious miscellaneous tr•ansactions involving capital assets
(i.e. sales,trade-ins and donations)is to ulcrease(decrease)net position. (1,679,324) 1,480,630
Revenues iu the statement of activities that do not provide current financial
resouz•ces are not reported as revenues in the funds. (247,317) (2,089,946)
The issuance of long-term debt(e.g.,bonds,leases)provides current financial
resources to govermnental funds,while the repayment of the principal of
long-term debt consumes the current financial resources of goveinmental funds.
Neither transaction,however,has any effect on net position. This amount is the
net effect of these differences in the treatment of long-telm debt and related items. 4,190,000 1,590,000
Some expenses reported in tlie statement of activities do not require tlie use of
current financial resources and,therefore,are not i•epoj-ted as expenditures in
governmenta]funds. 49,640 42,794
Change in net position of governmental activities(Statement 2) ($2,729,690) $1,557,104
The accompanying notes are an integral part of these financial statements.
38
C1TY Ol�'CHANflASSEN,MINNESOTA
STATEMENT OF NET POSITION Statement 6
PROPRIETARY FUNDS
December 31,2014
With Comparative Totals For December 31,2013
Surface Water �
Water Sewer Management Totals
Assets: 2014 2013
Cuirent assets:
Cash and cash equivalents $4,799,577 $4,430,348 $993,154 $10,223,079 $11,505,083 ',
Cash with escrow agent - - - - 3,670,439 i
Accrued interest receivable 24,299 19,387 5,028 48,714 44,789
Due fi•om other govei•nmental units 1,127 18,829 84,629 104,585 13,161
Accounts receivable-net 488,752 485,851 140,766 1,115,369 1,107,329
Prepaid items 4,990 4,890 2,471 12,351 1,572
Water meter invento�y 36,322 - - 36,322 45,277
Interfund loan receivable 466,933 - - 466,933 559,515
Special assessments receivable 112,899 4,721 - 117,620 36,321
Connection charges receivable 40,958 12,327 - 53,285 77,137
Total cun•ent assets 5,975,857 4,976,353 1,226,048 12,178,258 17,060,623
Noncuil•ent assets:
Capital assets:
Land 1,370,974 145,550 560,511 2,077,035 2,072,635
Easements 455,785 350,341 350,341 1,156,467 870,211
Buildings and sh•uctures 12,445,429 - - 12,445,429 12,445,429
Machinery and equipment 859,411 642,280 17,983 1,519,674 1,419,697
Other improvements 45,691,837 33,240,227 25,509,500 104,441,564 101,611,932
Const�-ucrion in progress 1,104,507 151,350 344,365 1,600,222 2,698,816
Total capital assets 61,927,943 34,529,748 26,782,700 123,240,391 121,118,720
Less: Allowance for depreciation (25,692,292) (21,148,340) (13,372,890) (60,213,522) (57,045,430)
Net capital assets 36,235,651 13,381,408 13,409,810 63,026,869 64,073,290
Total assets 42,211,508 18,357,761 14,635,858 75,205,127 81,133,913
Liabilities:
Cun•ent liabilities:
Accounts payable 101,281 12,342 17,978 131,601 96,991
Due to otl�er governmental units 22,224 77,035 7,445 106,704 ]07,028
Salaries payable 17,431 10,641 6,479 34,551 27,956
Contracts payable 28,391 28,391 - 56,782 256,908
Accrued interest payable 75,887 2,738 - 78,625 178,493
Unearned revenue - - - - 48,457
Compensated absences payable-due within one year 8,057 6,925 3,828 18,810 11,116
Bonds payable-due within one year• 729,026 60,000 - 789,026 4,704,026
Total cw•rent liabilities 982,297 198,072 35,730 1,216,099 5,430,975
Noncuirent liabilities:
Compensated absences payable-
due in more than one year 65,962 56,688 31,334 153,984 149,888
Bonds payable-due in more than one year 8,751,235 505,000 - 9,256,235 11,620,261
Total noncurrent liabilities 8,817,197 561,688 31,334 9,410,219 11,770,149
Totalliabilities 9,799,494 759,760 67,064 10,626,318 17,201,124
Net position:
Net investment in capital assets 27,320,390 13,381,408 13,409,810 54,111,608 52,541,451
Um�estricted 5,091,624 4,216,593 1,158,984 10,467,201 11,391,338
Total net position $32,412,014 $17,598,001 $14,568,794 $64,578,809 $63,932,789
The accompanying notes are an integral part of these financial statements.
39
CITY OF CHANHASSEN,MINNESOTA ,
STATEMENT OF REVENUES,EXPENSES AND Statement 7 '
CHANGES IN FUND NET POSITION '�
PROPRIETARY FUNDS !
Foi•The Year Ended December 31,2014 �
With Comparative Totals For The Year Ended December 31,2013
Surface Water
Water Sewer Management Totals
2014 2013
Operating revenues:
Chargesforseivices $2,441,499 $2,396,775 $620,150 $5,458,424 $5,575,159
Penalties and other 129,804 62,703 16,533 209,040 202,662
Total operating i•evenues 2,571,303 2,459,478 636,683 5,667,464 5,777,821
Operating expenses:
Personal seivices 577,094 388,392 261,932 1,227,418 1,182,524
Materials and supplies 257,252 34,019 46,337 337,608 350,231
Contractual services:
MCES - 1,461,463 - 1,461,463 1,398,891
Othei• 421,247 214,221 360,826 996,294 1,891,544
Repairs and maintenance 286,514 108,942 369 395,825 342,222
Deprecia6on 1,497,666 952,259 822,299 3,272,224 3,239,142
Total operating expenses 3,039,773 3,159,296 1,491,763 7,690,832 8,404,554
Operating income(loss) (468,470) (699,818) (855,080) (2,023,368) (2,626,733)
Nonoperating i•evenues(expenses):
Investment earnings 74,668 51,151 13,269 139,088 113,549
Net change in fair value of inveshnents (2,272) (1,813) (470) (4,555) (114,325)
Intergovernmental 1,008 35,984 173,865 210,857 63,112
Refunds and reimbursements 1,72�4 13,058 2,404 17,186 26,155
Interest and fiscal charges (308,192) (6,843) - (315,035) (561,759)
Gain(loss)on disposal of capital assets - (5,557) - (5,557) (618,746)
Total nonoperating revenues(expenses) (233,064) 85,980 189,068 41,984 (1,092,014)
hlcome before conh•ibutions and h•ansfeis (701,534) (613,838) (666,012) (1,981,384) (3,718,747)
Transfer in 45,275 - - 45,275 43,988
Transfer out (738,429) (125,204) (289,266) (1,152,899) (888,711)
Capital contributions:
Conh•ibutions of capital assets 905,480 267,572 518,769 1,691,821 1,217,538
Special assessments 179,996 7,114 - 187,110 70,832
Comiection cha�•ges 1,148,008 404,092 303,997 1,856,097 2,101,194
Total contributions and transfeis 1,540,330 553,574 533,500 2,627,404 2,544,841
Change in net position 838,796 (60,264) (132,512) 646,020 (1,173,906)
Net position-Januaiy 1 31,573,218 17,658,265 14,701,306 63,932,789 65,106,695
Net position-December 31 $32,412,014 $17,598,001 $14,568,794 $64,578,809 $63,932,789
� Capital Transfers-
Contributions Net
Amounts repor•ted above $3,735,028 ($1,107,624)
Amounts reported for business-type activities in the
state�nent of activities are different because:
Transfer in of capital assets from governmental activities (1,101,235) 1,101,235
Amounts repoi-�ed on the statement of activities $2,633,793 ($6,389)
The accompanying notes are an integral part of these financial statements.
40
CITY OF CHANHASSEN,MINNESOTA
STATEMENT OF CASH FLOWS Statement 8
PROPRIETARY FUNDS
For The Year Ended December 31,2014
With Comparative Totals For The Year Ended December 31,2013 ��
Surface Water
Water Sewei• Managen�ent Totals
2014 2013
Cash flows fi•oin operating activities:
Receipts fi•om custoiners and users $2,592,519 $2,409,762 $565,719 $5,568,000 $5,850,826
Payment Co suppliers (878,840) (1,869,503) (410,385) (3,158,728) (3,935,514)
Paymenttoemployees (569,109) (384,212) (255,712) (1,209,033) (1,155,564)
Miscellaneous revenue 2,732 49,042 127,812 179,586 137,724
Net cash flows provided by operating activities 1,147,302 205,089 27,434 1,379,825 897,472
Cash f7ows from noncapital financing activities:
Ti•ansfers in 45,275 - - 45,275 43,988
Transfers out (738,429) (125,204) (289,266) (1,152,899) (888,711)
Dec}•ease in interfund loan receivable 92,582 - - 92,582 87,341
Net casl�f7ows provided by(used in)
noncapital financing activities (600,572) (125,204) (289,266) (1,015,042) (757,382)
Cash flows fi•o�n capital and related financing activities:
Acquisition of capital assets (323,936) (375,585) (40,145) (739,666) (638,937)
Connection chai•ges 1,165,175 410,777 303,997 1,879,949 2,105,127
Special assessment revenue 86,723 19,088 - 105,811 53,666
Principal paid on bonds (6,207,500) (57,500) - (6,265,000) (4,240,000)
Tnterest and fiscal charges (421,846) (7,082) - (428,928) (503,097)
Net cash flows provided by(used in)capital
and i•elated financing activities (5,701,384) (10,302) 263,852 (5,447,834) (3,223,241)
Casl�flows fi•om investing activities:
Inveshnent earnings 71,295 48,249 11,064 130,608 (1,929)
Net(decrease)in cash and cash equivalents (5,083,359) 117,832 13,084 (4,952,443) (3,085,080)
Cash and cash equivalents-Januaiy 1 9,882,936 4,312,516 980,070 15,175,522 18,260,602
Cash and cash equivalents-December 31 $4,799,577 $4,430,348 $993,154 $10,223,079 $15,175,522
Reconciliation of operating income(loss)to net cash
provided(used)by operating activities:
Operating income(loss) ($468,470) ($699,818) ($855,080) ($2,023,368) ($2,626,733)
Adjustments to reconcile opei•ating income(loss)
to net cash flows fi•om oper•ating activities:
Miscellaneous revenue(expense) 2,732 49,042 127,812 179,586 137,724
Depreciation 1,497,666 952,259 822,299 3,272,224 3,239,142
Changes in asseCs and liabilities:
Decrease(increase)in receivables 21,216 (49,716) (70,964) (99,464) 73,005
Decrease(increase)in prepaid iten�s (4,328) (4,228) (2,223) (10,779) 13,212
Deci•ease(increase)in inventoiy 8,955 - - 8,955 (21,271)
Increase(decrease)in payables 89,531 (42,450) 5,590 52,671 82,393
Total adjustments 1,615,772 904,907 882,514 3,403,193 3,524,205
Net cash pi•ovided by operating activities $1,147,302 $205,089 $27,434 $1,379,825 $897,472
Noncash investing,capital and financing activities:
Capital asseYs in the amount of$905,480 and$544,212 were conri-ibuted to the Water Fund in 2014 and 2013,respectively.
Capital assets in the amount of$267,572 and$342,184 were contcibuted to the Sewer Fund in 2014 and 2013,respectively.
Capital assets in Yhe amount of$518,769 and$331,142 were contributed to the Surface Water Fund in 2014 and 2013,3•espectively.
The accompanying notes are an integral part of these financia]staYements.
41
CITY OF CHANHASSEN,MINNESOTA
STATEMENT OF NET POSITION Statement 9
FIDUCIARY FUNDS
December 31,2014
With Coinparative Totals For Deceinber 31,2013 ��
Agency Funds
2014 2013
Assets:
Cash and investments $1,306,003 $1,426,193
Liabilities:
Escrow depositspayable $1,306,003 $1,426,193
The acco�npanying notes are an integl•al part of these financial statements.
42
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of Chanhassen,Minnesota(the City)was incoiparated in 1967 and operates wlder the State of
Minnesota Statutory Plan B farm of government. The governing body consists of a five member Ciry council
elected by votei•s of the City.
The financial statements of the City have been prepared in conformity with accounting pi7nciples generally
accepted in the United States of America as applied to governmental units by the Goveinmental Accounting
Standards Board(GASB). The following is a suimnary of the significant accounting policies.
A. FINANCIAL REPORTING ENTITY
In accordance witl�GASB pronouncements and accounting principles generally accepted in the United
States of America,the financial statements of the reporting entity should include those of the City(tl�e
primary government)and its component uuits. The component unit discussed below is included in the
City's reparting entity because of'the siguificance of its oper•ational or financia]3•elationships with the
City.
COMPONENT UNITS
In conformity with accounring principles generally accepted in the United States of America,the
financial statements of the coinponent unit have been included in the financial report as a blended
coinponent unit.
Pursuant to the authorization of Minnesota Statutes Section 469.094,on Apri128, 1997 the Ciry
transferred to the Economic Development Authority of the City all activities,programs,
operations,and authority of the existing City Housing and Redevelopment Authoi•ity(HRA). The
Econo�nic Development Authority(EDA),an entity legally separate fi�om the City,is governed by
a board which is substantially tl�e same as the City Council. The City is in a relationship of
financial benefit or burden with the EDA. Se�arate financial statements fo3•the EDA are not
prepared.
JOINTLY GOVERNED ORGANIZATIONS
Southwest Area Transit Coinmission. The City,in conjunction with the Cities of Eden Praii•ie and
Chaska,has agreed to establish the Southwest Area Tr�ansit Commission(the Co�mnission). The
purpose of the Commission is to provide alternative methods of public n�ansit seivice to the thi•ee
cities. The Commission's board is composed of two commissioners fi•oin each of the cities.
Western Area Fire Trainin�Association(WAFTA). The City is a member of a joint powers
group along with ten other communities. WAFTA operates a fire training facility in western
Ca�ver County.
JOINT POWERS AGREEMENT
Tlle Chauliassen Recrearion Center is owned by Independent Scl�ool Disri�ict No. 112 and operates
under a joint powers agreeinent between the City and the School District. The ninery-nine yeai•
agreement expires in 2093. According to the terins of the agreement,the City reimburses the
Scliool District 24%of the cost to operate and maintain the facility.
43
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
B. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS ,
The govermnent-wide finailcial statements(i.e.,the statement of net position and the statement of
cl�anges in net position)report information on all of the nonfiduciary activities of the primaiy
goveinment and its component units. Gover�nmental activr.ties, which nonnally are supported by taxes
and intej•governmental revenues,are reported separately fi•om bustr�ess-type activities, which rely to a
significant extent on fees and charges for suppar-t.
The statement of activities demonstrates the degree to which the direct expenses of a given functiou or
business-type activity,are offset by program revenues. Direct expe�ases are those that are cleai•ly
identifiable with a specific function or business-type activity. Pr•ogram revenues include 1)cha3•ges to
customers or applicants who pw•chase,use,or directly benefit from goods,seivices,or privileges
provided by a given function or business-type activity and 2)grants and contributions that are
restricted to meeting the operational or capital requirements of a particular function or business-type
activity. Taxes and other items not included among program r•evenues are reported instead as general
revenues.
Separate finaneial statements are provided for governmental funds,proprietary funds,and fiduciary
funds,even though the latter are excluded fi•om the government-wide financial statements. Major
individual governmental funds and major individual enterprise funds are reported as separate columns
in the fund financial statements.
C. MEASUREMENT FOCUS,BASIS OF ACCOUNTING,AND FINANCIAL STATEMENT
PRESENTATION
The government-wide financial statements are reported using tlie econ�omi�c resources measurement
focus and the accrual basis of accounting, as are the proprietaiy fund financial stateinents. Revenues
are recarded when eai•ned and expenses are recorded when a liability is incun�ed,regardless of the
timing of r•elated cash flows. Property taxes are r•ecognized as revenues in the year for which they ai•e
levied. Grants and similar iteins are recognized as i•evenue as soon as all eligibility requirements
imposed by the provider have been met. The City's only fiduciary funds are agency funds. Agency
funds are custodial in natur•e(assets equal liabilities)and do not involve measureinent of results of
operati ons.
Governmental fund financial statements are reported using tl�e current fznancial resources
measurerne�at focus and the modified accrual basis of accounting. Revenues are recognized as soon as
they are both measurable and available. Revenues are considered to be available when they are
collectible within the current period oi•soon enough thereafter to pay liabilities of the cun�ent period.
For this purpose,the City considers all revenues, except reimbursement grants,to be available if they
are collected within 60 days of the end of the current fiscal period. Reimburseinent grants are
considered available if they are collected within one year of the end of tl�e current fiscal period.
Expenditw�es generally are i•ecorded when a liability is incun�ed,as under accrual accounting.
However,debt service expenditures,as well as expenditures related to compensated absences and
claiins and judgments,are recorded only when payment is due.
44
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Property taxes, special assessments,intergovernmental 3•evenues,cha�•ges for seivices and interest
associated with the cur•rent fiscal period are all considered to be susceptible to accrual and so l�ave
been recognized as revenues of the cwrent fiscal period. Only the portion of special assessments
receivable due within the cm•rent fiscal period is considered to be susceptible to accrual as revenue of
the current period. All other revenue items are considered to be measurable and available only when
cash is received by the City.
The City reports tl�e following majar governmental funds:
General Fund is the City's primaiy operating fund. [t accounts for all financial resow•ces of the
general gove�nment,except those required to be accounted for in another fund.
2009A General Obligati�on Improvement Bond Fitnd(368)accounts for the accumulation of
resources for payment of the general obligation bonds issued to finance utility improvements.
Transit Station Assessment Furrd(Q13)accounts for tbe interfund loan fi�om the Water Fund to
fund costs associated with the redevelopment of the Dimler Theater Transit Station in TIF#10,
and far the repayment of the special assessment to repay those costs.
Revolvirrg Assessn�erat Ficnd(601)accounts foi•the City's annual street i•e-construction prograns.
The individual p3•ope3�ty owner will pay a portion of the cost of the annual project with
assessments and the City will fund their portion with the reserves created in this fund and an
annual tax levy in future yeais.
TNIOl lmprovements—Lyman to Pioneer Fund(604)accounts for the funding sources and costs
of the Trunk Highway 101 improvement project,which ineludes widening of the highway
between Lyman Boulevard and Pioneer Trail,pedestrian/bieycle trails and a trail underpass.
The City reports the following major proprietary funds:
The Water Fund accowits for the water se�vice charges which are used to finance the watel•
system operating expenses.
The Sewer Fund accounts for the sewer•seivice charges which are used to finance the sanitaiy
sewer system operating expenses.
The Surface Wazer Maraagement Fund accounts for the surface water charges which are used to
finance the surface water system operating expenses.
Additionally,the City reports the following fund type:
Agency funds account for the assets of various escrow deposits and tl�e Moon Valley Restoration
Funds held by the City in a h•ustee capacity or as an agent.
As a general rule the effect of interfund activiry has been eliminated from the government-wide
financial statements. Exceptions to this general rule are transactions that would be treated as revenues,
expenditures or expenses if they involved external organizations,such as buying goods and services or
payments in lieu of taxes,are similarly treated when they involve other funds of the City. Eliinination
of tl�ese charges would distorC the direct costs and program revenues reported for the various functions
concerned.
45
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Amounts reported as program revefaues include 1)charges to customers or applicants for goods,
seivices,or privileges provided,2)operating grants and conh�ibutions,and 3)capital grants and
contributions,including special assessments. Internally dedicated resom�ces are reported as genef-al
revenues rather than as program revenues. Likewise,general revenues include all taxes.
Proprietary Funds distinguish oper•ating revenues and expenses from nonoperatzng items. Operating
revenues and expenses generally result from providing services and producing and delivering goods in
connection with a proprietaiy fund's principal ongoing operations. The principal operating revenues �
of the water,sewer,and surface water management ente�prise funds are charges to custoiners for sales
and se�vices. Operating expenses for ente�prise funds include the eost of sales and services, ',
administrative expenses,and depreciation on capital assets. All revenues and expenses not meering �I
this definition are reported as nonoperating revenues and expenses. i
D. BUDGETS I'
Budgets are adopted on a basis consistent with accounting principles generally accepted in the United I��
States of America. Ammal appropriated budgets are adopted for the General Fund and for the
Contribution and CATV Special Revenue Funds. �
Budgeted amounts ai•e reported as originally adopted,or as amended by the City Council. There were
no budget amendments dw•ing 2014. Budgeted expenditure appropj•iations lapse at year end.
Encumbrance accounting,under which purchase orders,contracts,and other commitments for the
expenditure of monies are recarded in order to 3•eserve that portion of the appropriation,is not
employed by tl�e City because it is at present not considered necessaly to assure effective budgetary
control or�to facilitate effective cash management.
E. LEGAL COMPLIANCE-BUDGETS
The Ciry follows these procedures in establishing the budgeta�y data reflected in the financial
statements:
1. The City Manager submits to the City Council a proposed operating budget for the fiseal year
commencing the following Januaiy 1. Tl�e operating budget includes proposed expenditures
and the means of finaneing them.
2. Public hearings are conducted to obtain taxpayer cominents.
3. The budget is legally enacted througli passage of a resolution.
4. Management may authorize ti•ansfer of budgeted amounts between departments within any
fund. All budget amendments between funds must be approved by the City Couneil. Tl�e
legal level of budgetary control is at the fund level. Budgetaiy monitoring,by departments ar
divisions and by catego�y,is required by City poliey.
46
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014 I
5. Formal budgetaiy integration is employed as a management control device during the year for
the General Fund and for the Contribution and CATV Special Revenue Funds. Formal
budgetary integration is not employed far Debt Service Funds because effective budgetary
contr�ol is alternatively achieved through gene3•al obligation bond indenture provisions.
Budgetary control for Capital Projects Funds is accomplished through the use of project
controls.
Dw•ing 2014,the General Fund had expenditur•es of$9,987,009,whicli exceeded budgeted
expenditm•es of$9,928,949 by$58,060. The Contribution Special Revenue Fund had expenditures of
$34,488,which exceeded budgeted expenditures of$30,000 by$4,488.
F. CASH AND INVESTMENTS
Cash and investment balances from all funds are pooled and invested to the extent available in
authoi•ized investinents. Investment incoine is allocated to individual funds on the basis of the fund's
equity in the cash and investment pool.
Investments are stated at fair value,based upon quoted market prices,except for investments in 2a7-
like external investinent pools,which are stated at amoi�tized cost. Invest�nent income is accrued at the
balance sheet date.
For puiposes of the statement of casl�flows,the Propr�ieta�y Funds considei•all highly liquid
investments with a inaturity of three inonths or less when purchased to be cash equivalents. All of the
cash aud investments allocated to the Proprietary Fund types have original maturities of 90 days or
less. Thei•efore,tlle entire balance in such fund types is considered cash equivalents.
G. RECEIVABLES
Prope3-ty taxes and special assessinent receivables have been 1•eported net of estimated uncollectible
accounts(See Note 1 H and I). Because utility bills are considered liens on property,no estimated
uncollectible ainounts are established. Uncollectible amounts are not material for other receivables
and have not been reported.
H. PROPERTY TAX REVENUE RECOGNITION
The City Council annually adopts a tax levy and certifies it to the County in December
(levy/assessment date)of each year for collection in the following year. The County is responsible for
billing and collecting all property taxes for itself,the City,the local School District and other taxing
authorities. Such taxes become a lien on January 1 and are recorded as i•eceivables by the City at that
date. Real property taxes are payable(by property owners)on May 15 and October 15 of each
calendar year. Persona]property taxes are payable by taxpayers on Februaiy 28 and June 30 of each
yeat•. These taxes al•e collected by the County and remitted to the City on or before July 15 and
December 15 of the same year. Delinquent collections foi•Noveinber and December are received the
following January. The City has no ability to enforce payment of property taxes by property owneis.
The County possesses this authority.
47
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
�I
GOVERNMENT-WIDE FINANCIAL STATEMENTS
The City recognizes property tax revenue in the period far which taxes were levied. Uncollectible
property taxes are not material and have not been reported.
GOVERNMENT FUND FINANCIAL STATEMENTS
The City recognizes property tax revenue when it becomes both measurable and available to finance
expenditw•es of the current period. In practice,current and delinquent taxes and State credits received
by the City in July,Decembei•and Janua�y are recognized as r�evenue for the cun•ent year. Taxes
collected by the County by December 31 (i•emitted to the City the following January)and taxes and
ci•edits not received at year end are classified as delinquent and due fi•om County taxes receivable. The
portion of delinquent taxes not collected by the City in January are fully offset by deferred inflows of
resources because they are not available to finance cui�•ent expenditures.
The City's property tax revenue includes payments fi•om the Metropolitan Revenue Distribution(Fisca]
Disparities Formula)per State Statute 473F. This statute provides a means of spreading a portion of
the taxable valuation of commercial/industrial real property to vai•ious taxing authorities within the
defined inetropolitan area. The valuation"shared" is a portion of commei•cial/industrial property
valuation growth since 1971.
I. SPECIAL ASSESSMENT REVENUE RECOGNITION
Special assessments are levied against bene�ted properties far the cost or a portion of the cost of
special assessment improvement pi•ojects in accordance with State Statutes. These assessments are
collecrible by the City over a term of years usually consistent with the tei-m of the related bond issue.
Collection of anuual installments(including interest)is handled by the Cowlty Auditor in the same
manner as property taxes. Properry owners are allowed to(and often do)prepay future installments
without interest o3•prepayment penalties.
Once a special assessment roll is adopted,the amount att�•ibuted to each parcel is a lien upon that
property until full payment is made or the amount is determined to be excessive by the City Council ar
court action. If special assessments are allowed to go delinquent,the property is subject to tax forfeit
sale and the first proceeds of that sale(after costs,penalties and expe��ses of sale)are remitted to the
City in payment of delinquent special assessments. Generally,the City will collect the full amount of
its special assessments not adjusted by City Council or court action. Pursuant to State Statutes,a
property shall be subject to a tax forfeit sale after three years unless it is homesteaded,agricultural or
seasonal3•ecreational land in wllicl�event tl�e property is subject to such sale after five years.
GOVERNMENT-WIDE FINANCIAL STATEMENTS
The City recognizes special assessment revenue in the period that the assessment roll was adopted by
the City Council. Uncollectible special assessinents are not material and have not been repoi-�ed.
GOVERNMENT FUND FINANCIAL STATEMENTS
Revenue from special assessments is i•ecognized by the City when it becomes measm�able and
available to finance expenditures of the current fiscal period. In practice,curr•ent and delinquent
special assessments received by the Ciry are recognized as revenue for the cui7�ent year. Special
assessments are collected by the County and remitted by December 31 (remitted to the City the
following January)and are also recognized as revenue for the current year. All remaining delinquent,
deferred and special defer•red assessments receivable iu goveinmental funds are completely offset by
defeired inflows of resources.
48
CITY OF CHANHASSEN,MINNESOTA ,
NOTES TO FINANCIAL STATEMENTS '
December 31,2014
J. INVENTORIES
GOVERNMENTAL FUNDS
The original cost of materials and supplies are recor•ded as expenditui•es at the time of purchase. Tl�ese
funds do not maintain materia]amounts of inventol7es.
PROPRIETARY FUNDS
Inventories of the Proprietary Funds are stated at cost,which a�proxiinates market,using the fiist-in,
fiist-out(FIFO)method.
K. PREPAID ITEMS
Certain prepayments to vendors reflect costs applicable to future accounting periods and are recorded
as prepaid items in botll government-wide and fund financial statements. Prepaid items are reported
using the consumption method aild recorded as expenditures/expenses at the time of consumption.
L. CAPITAL ASSETS
Capital assets,which include property,plant,equipment,infi•astructw�e assets(e.g.,r�oads,trails,
sidewalks,and similar items),and intangible assets such as easemeilts and computer software,are
reported in the applicable governmental or business-type activities coluinns in the government-wide
financial statements. Capital assets are defined by the City as assets with an initial,individua] cost of
more than$5,000(except for easements which is$10,000)and an estimated useful life in excess of
one year. Such assets are recorded at historical cost or estimated historical cost if pul•chased or
constructed. Donated capital assets are recorded at estimated fair market value at the date of donation.
In the case of the initial capitalization of genef•al infrastructui•e assets,the City chose to include all
such iteins regardless of their acquisirion date alnount. These assets are reparted at historical or
estimated historical cost,using the 1987 base highway construction price trend,when historical costs
were unavailable.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially
extend assets lives are not capitalized.
Majoi•outlays for capital assets and iinprovements are capitalized as pi•ojects are constructed. I�lterest
incuired dm-ing the construction phase of capital assets of business-type activities is included as pa�•t of
the capitalized value of the assets constructed. For the year ended December 31,2014,no interest was
capitalized in comlection with construction in progi•ess.
49
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Capital assets of the City are depreciated/amartized using the straight line method over the following
estimated useful lives:
Buildings and structures 20—50 years
Machineiy and equipment(including software) 3—30 years
Drainage systems 30 years
Water and sewer lines 30 years
Streets 25—50 years
Trails 15 years
Sidewalks 25 years
Other impt•ovements 7—40 years
Temporary easements 2 years
M. COMPENSATED ABSENCES
Tlle City coinpensates all employees upon termination for unused vacation and unused sick time up to
a maximum based upon length of service. The City compensates nonexempt employees for unused
comp time. All vacation pay and comp time is accrued when incun•ed in the government-wide and
pr•oprietaiy fund financial stateinents. A liability far these amounts is reported in governmental funds
only if t11ey l�ave inatured,for exalnple,as a result of employee resignations and retire�nents. In
accordance with the provisions of Statement of Govermnent Accounting Standards No. 16,Accounting
for�Compensated Absences, no liability is reco�•ded for nonvesting accumulating rights to receive sick
pay benefits. However,a liability is recognized for that portion of accumulating sick leave benefits
that is vested as sevel•ance pay.
N. LONG-TERM OBLIGATIONS
In the government-wide financial statements and proprietary fund types in tl�e fund financial
statements,long-term debt and other long-term obligations are reported as liabilities in the applicable
governmental activities,business-type activities,or proprietaiy fund type statement of net position.
Bond premiums and discounts,if material,are amortized over the life of the related debt.
In the fund 6nancial statelnents,governmental fund types recognize bond premiulns and discounts
during the current pe�7od. The face amount of debt issued is repol�ted as other financing sources.
Premiums received on debt issuances are repor-ted as other financing sour•ces while discounts on debt
issuances are reparted as other financing uses.
50
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
O. DEFERRED INFLOWS OF RESOURCES
In addition to liabilities,the statement of financial position reports a separate section for deferr�ed
iirflows of resources. This separate financial statement elelnent represents an acquisition of net
position that applies to futur•e periods,and therefore,will not be recognized as an inflow of resources
(revenue)until that tiine. The government llas one type of item,which arises only under a modified
accrual basis of accounting,that qualifies for reporting in this category. Accordingly,the item,
unavailable r•evenue,is reported only in the governmental fund balance sheet. The govei•nmental
funds report unavailable revenues froin the following sources: property taxes, special assessments and
other revenue not collected within 60 days from year-end.
P. FUND BALANCE CLASSIFICATIONS
In ihe fund financial statements,govermnental fnnds 1•eport fund balance in classifications that disclose
constraints for which amounts in those funds can be spent. These classifications are as follows:
Nonspendable-consists of amounts that are not in spendable forin,such as prepaid items.
Reszricted-consists of amounts related to externally imposed constraints establisl�ed by creditors,
grantors or conri�ibutars; or constraints imposed by state statutory provisions.
Comnaitted-consists of intei•nally imposed constraints. These constraints are established by
Resolution of City Council,and committed amounts cannot be used for any otl�er pmpose unless
the City Council removes or cl�anges the specified use by resolution.
Assigned-consists of inter•nally imposed constraints fbr the specific purpose of the City's
intended use. Pursuant to the City's Fund Balance Policy,the City Managei•or Finance Director
are authorized to assign fund balance that reflects the City's intended use of those funds.
Unassigned-is the residual classification for the general fund and also reflects negative residual
amounts in other funds.
When both restricted and unrestricted resources are available for use,it is the City's policy to fi�st use
restricted resources,and then use um•est3•icted resources as they are needed.
When committed,assigned ot•unassigned resources are available foi•use,it is the City's policy to use
i•esources in tlle following oi•der; 1)com�nitted 2)assigned and 3)unassigned. The exception to this is
the Par•k Acquisition and Development Fund(410),where it is the City's policy to use t•esources in the
following arder; 1)assigned,2)colnmitted,and 3)restricted.
51
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Q. INTERFUND TRANSACTIONS ',
Dw�ing the course of operations,numerous transactions occur between individual funds for goods !
provided or sejvices rendered. Interfmld services provided and used are accounted for as revenues, I
expenditu�•es or expenses. Transactions that constitute reimbursements to a fund for
expenditures/expenses initially made from it that are properly applicable to another fund,are recorded
as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the ,
fund that is reimbursed.
The City provides teinporary advances to funds that have ulsufficient cash balances by means of an
advance from another fw1d. Short-term interfund loans are classified as"due to/fi•om other funds."
Long-term interfund loans are classified as"interfund loan receivable/payable." Any residual balances
outstanding between tlle governmental activities and business-type activities are reported in the
goveinment-wide financial statements as"internal balances." All other intei•fund transactions at•e
reported as ti•ansfers.
R. USE OF ESTIMATES
The preparation of financial state�nents in accordance with generally accepted accounting principles
(GAAP)requi3•es management to make estimates that affect ainounts reported in the financial
statements dw•ing the reporting period. Actual results could differ fi-om such estirnates.
S. COMPARATIVE TOTALS
The basic financial statements and schedules,required supplementary information,and combining and
individual fund financial statements include certain prior-year summarized comparative information in
total but not at the level of detail required for a presentation in conformity with generally accepted
accounting principles. Accordingly,such information should be read in conjunction with the
government's financial statements for the year ended December 31,2013,from which the summarized
information was derived.
52
CITY OF CHANHASSEN,MINNESOTA '�
NOTES TO FINANCIAL STATEMENTS
December 31,2014 '
T. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS
1. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND
BALANCE SHEET AND THE GOVERNMENT-WIDE STATEMENT OF NET POSITION
The governmental fund balance sheet includes a reconciliation between fuf�d balances—total
governm�enzal funds and net position—governmental activities as reported in the govermnent-wide
state�nent of net position. One element of that reconciliation explains that"long-term liabilities,
including bonds payable,al•e not due and payable in the cmrent period and therefore are not
reported in the funds." The details of this($12,896,1 l7)difference are as follows:
Bonds payable ($11,890,000)
Accrued inYerest payable (188,949)
Compensated absences (791,637)
Other post employment benefit payable (25,531)
Net adjustment to decrease fund balances-total governmental
funds to arrive at net position-governmental activities ($12,896,ll 7)
2. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND
STATEMENT OF REVENUES EXPENDITURES.AND CHANGES IN FUND BALANCES
AND THE GOVERNMENT-WIDE STATEMENT OF ACTNITIES
The government fund statement of revenues,expenditures,and changes in fund balances includes
a reconciliatioil between net changes in fund balances—total gove��nmental funds and changes in
netposition ofgovef�nmerital activiti�es as 3•eported in tl�e government-wide statement of activities.
One element of tbat reconciliation explains that"governmental funds repotrt capital outlays as
expenditm•es. However,in the statement of activities the cost of those assets is allocated over
their estimated useful lives and reported as depreciation expense." The details of this
($1,535,503)difference are as follows:
Capital outlay/construction $3,437,404
Depreciation expense (4,972,907)
Net adjustment to decrease net changes in fund balances-total
governinental funds to arrive at changes in net position of
govei•nmental activities ($1,535,503)
Si
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Another element of that t•econciliation states that"the net effect of various miscellaneous
transactions involving capital assets(i.e.,sales,trade-ins aud donations)is to increase(decrease)
net position." The details of this($1,679,324)difference are as follows:
Donarions of capital assets increase net position in the
statement of activities,but do not appear in the governmental
funds because tlley ai•e not financial resources $621,919
Transfer of capital assets to Enteiprise Funds (1,101,235)
The statement of activities reports losses arising fi-om the
trade-in or disposal of existing assets to acquire new capital
assets. Conversely,governmental funds do not report any
gain or loss on t3•ade-in of capital assets (1,200,008)
Net adjustment to decrease net changes in fund
balances-total governmental funds to arrive at
changes in net position of governmental activities ($1,679,324)
Another element of that t•econciliation states that"revenues on the statement of activities that do
not provide current financial resources are not reported as f•evenues in the funds." The details of
this($247,317)difference are as follows:
Unavailable i�evenue-general pro�erty taxes:
At Decembe3•31,2013 ($76,946)
At December 31,2014 69,869
Unavailable revenue-special assessments:
At December 31,2013 (3,451,493)
At December 31,2014 3,203,449
Other revenue was not available because it was not
collected within 60 days fi�om year-end.
At December 31,2013 (5,589)
At Deceinber 31,2014 13,393
Net adjustment to decrease net changes in fund balances-total
governmental funds to arrive at cllanges in net position of
governmental activities ($247,317)
54
CITY OF CHANHASSEN,MINNESOTA ,
NOTES TO FINANCIAL STATEMENTS �
December 31,2014
Anothez•element of that reconciliation states that"the issuance of long-term debt(e.g.,bonds,
leases)p3•ovides current financial resources to governmental funds,while the repayment of the
long-term debt consuines the cmrent financial resources of governmental funds." Neither
t�•ansaction,however,has any effect on uet position. The details of this$4,190,000 difference are
as follows:
Principal3•epayments:
Gener•al obligation debt $605,000
General obligation improveinent bonds 3,515,000
General obligation tax increment bo�lds 70,000
Net adjustment to increase net changes in fund balances-total
governmental funds to arrive at changes in net position of
governmental activities $4,190,000
Another element of that reconciliation states that"some expenses reported in the statement of
activities do not require the use of current financial resources and therefore are not repo3-ted as
expenditm•es in governmental funds." The details of this$49,640 difference are as follows:
Compensated absences $2,596
Other post employinent benefits (5,743)
Accrued interest 52,787
Net adjustment to increase net changes in fund balances-total
govermnental funds to arrive at changes in net position of
governmental activities $49,640
Note 2 DEPOSITS AND INVESTMENTS
A. DEPOSITS
In accordance with Minnesota Statutes,the City inaintains deposits at those deposito�y banks
authorized by the City Council,all of which are members of the Federal Rese�ve System.
Custodial Credit Risk—Custodial ci•edit risk is the r�sk that in the event of a bank failur•e,the City's
deposits may not be returned to it. Minnesota Statutes require that insurance,surety bonds or
collateral pi•otect all City deposits. The market value of collateral pledged must equal 110%of
deposits not covered by insurance or bonds. The City has no additional deposit policies addressing
custodial credit risk. As of December 31,2014,the ba�1k balance of the City's deposits was insut•ed by
the FDIC or covei•ed by pledged collateral held in the City's name.
55
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS '
December 31,2014 I
Minnesota Statutes require that securities pledged as collateral be held in safekeeping by the City
Treasure3•or in a financial institution other than that furnishing the collateral. Authorized collatei•al
includes the following:
a) United States government treasuiy bills,treasuiy notes,ri•easmy bonds;
b) Issues of United States government agencies and insn�umentalities as quoted by a recognized
indust�y quotation service available to the gove3•nment entity;
c) General obligation securities of any state or local government with taxing poweis which is rated
"A"or•better by a national bond rating se�vice,or revenue obligation securities of any state or
local government with taxing powers which is t•ated"AA"or bettet•by a national bond rating
service;
d) General obligation securities of a local government with taxing powers may be pledged as
collateral against funds deposited by that same local government entity;
e) Irrevocable standby letters of credit issued by Federal Hoine Loan Banks to a municipality
accompanied by written evidence that tlie bank's public debt is rated"AA"or better by Moody's
Investor•s Service,Inc.or Standard&Poor's Corporation;and
f) Time deposits that are fully insured by any federal agency.
At Deceinber 31,2014,the canying ainount of the City's deposits with financial institutions was
$3,439,484.
B. INVESTMENTS
Minnesota Statutes authorize the City to invest in the following:
a) Direct obligations or obligations guaranteed by tl�e United States or its agencies,its
instrumentalities,o�•organizations created by an act of congress,excluding mortgage-backed
secw7ties defined as high risk.
b) Shares of investment companies registered under the Federal Investment Company Act of 1940
and whose only investments are in securities described in(a)above,general obligation tax-exempt
securities,or i•epur•chase or reverse repm•chase agreements.
c) State and local securities as follows:
1) any secm�ity which is a general obligation of any state or local government with taxing
powers which is rated"A"or better by a national bond rating service;
2) any security which is a revenue obligation of any state or local government with taxing
powers which is rated"AA"or better by a national bond rating service; and
3) a general obligation of the Minnesota Housing Finance Agency which is a moral obligation of
the State of Minnesota and is rated"A"or better by a national bond rating agency.
d) Baukers acceptance of United States banks.
56
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
e) Commercial paper issued by United States coiparations or their Canadian subsidiaries,of the
highest quality,and maturing in 270 days or less.
f� Repurchase or reverse repuj•chase agreements with bai7ks that are members of the Federal Reserve
System with capitalization exceeding$10,000,000;a primary reporting dealer•in U.S.government
securities to the Federal Reserve Bank of New York; certain Minnesota secur�ities broker-dealers;
or,a bank qualified as a depositor.
g) General obligation temporaiy bonds of the same governmental entity issued under section
429.091, subdivision 7;469.178, subdivision 5;or 475.61,subdivision 6.
As of December 31,2014,the City had the following investments and maturities:
Inveshnent Maturities(in Years)
Pair Less
]nvesunentType Rating Value Than 1 1-5 6-10
4M Fund NR $l 1,257 $11,257 $ - $ -
Money Market Funds NR 2,217,280 2,217,280 - -
Brokered Certificates ofDeposit NR 5,185,770 1,990,829 2,951,285 243,656
Municipal Bonds (l) 11,022,360 4,494,830 6,113,978 413,552
Fedei�l Home Loan Bank Notes Aaa 2,447,]32 - 1,760,111 687,021
Pederal Narional Mortgage Assn.Notes Aaa 3,176,938 506,1]3 2,670,825 -
Federal Home Loan Martgage Cmp.Notes Aaa 1,489,732 - 1,489,732 -
Federal Agricultural Mortgage Assn.Notes Aaa 499,993 - 499,993 -
Resolution Funding Cor�.Sh�ip Bonds Aaa 582,398 - 582,398 -
Total $26,632,860 �9,220,309 $16,068,322 $1,344,229
(1)$2,316,810 are rated Aaa,$997,675 are rated Aal, Total invesrinents $26,632,860
$3,790,102 are rated Aa2,$2,901,143 are rated Aa3 and$1,016,630 Deposits 3,439,484
are rated Al. Petty cash 665
NR-Not Rated Total cash and investments $30,073,009
Classifications above are by maturity date.Some investments listed above have call dates that occur in less than one year.
These amounts are presented in the financial statements as follows:
Cash and investments:
Governmental and business-type(Statement 1) $28,767,006
Fiduciaiy(Statement 9) 1,306,003
Total $30,073,009
57
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
C. INVESTMENT RISKS
Custodial credit risk—investments—For investments in secu3•ities,custodial credit r•isk is the risk that
in the event of failure of tl�e counterparty to a transaction,the City will not be able to recover the value
of its investment securities that are in the possession of an outside party. Investments in invesrinent
pools and money markets are not evidenced by secui7ties that exist in physical oi•book entry foi•m,and
thei•efore ar�e not subject to custodial credit risk disclosures. The City's investment policy requires the
City's security broker/dealers to provide its audited financial statements,proof of NASD certification,
proof of state�•egisri�arion,and certification of having read,undei•stood and agreed to comply witl�the
City's investment policy.Investments in securities ar•e held by the City's broker-dealer of which
$2,000,000 is insured through SIPC. Each broker-dealer has provided additional protection by
providing additional insurance. This insurance is subject to aggregate limits applied to all of the
broker-dealer's accounts.
Interest rate risk—Inter•est rate risk is the risk that changes in interest rates of debt investments could
adversely affect the fair value of an investment. The City's investment policy r•equires the Ciry to
diversify its investment portfolio to eliminate ihe risk of loss i•esulting from over concentration of
assets in a specific maturity. The policy also states the City's investment portfolio will remain
sufficiently liquid to enable the City to meet all operating requirements which might be reasonable,
i.e.,not investing in maturities longei•than seven years.
Credit Risk—Credit risk is the r•isk that an issuer or other counterparty to an investment will be unable
to fulfill its obligation to the holder of the investment. State law limits investments to commercial
paper to those r•ated in the higl�est quality category by at least two nationally recognized rating
agencies; in any security of the State of Minnesota or any of its municipalities which is rated"A"or
better by a national bond rating seivice for general obligation and rated"AA"ar bettei•for a revenue
obligation;a general obligation of the Minnesota Housing Finance Agency to those rated"A"or better
by a national bond rating agency;muYual funds or money market funds whose investments are
resti•icted to securities described in MS ll 8A.04. The City's investment policy does not place fur•ther
restrictions on investment options. The City's external investment pool is with the 4M fund which is
regulated by Minnesota Statutes and the Board of Directors of the League of Minnesota Cities. The
4M fund is an unrated 2a7-like pool and the fair value of the position in the pool is the same as the
value of pool shares.
Concentration of credit risk—Concentration of credit risk is the risk of loss that may be attributed to
the magnitude of a government's investment in a single issuei•. The City's investment policy states
investments shall be diversified by limiting investments to avoid over concentration in securities fi•om
a specific issuer ar business sector(excluding U.S.Treasury securities). Invesrinents in a single issuer
exceeding 5%of the City's overall cash and investment portfolio(eXcluding cash with escrow agent)
are in various holdings as follows:
Federal Home Loan Bank notes 8%
Federal National Mortgage Association notes 11%
Federal Home Loan Mortgage Corporation notes 5%
58
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Note 3 RECEIVABLES
Significant receivable balances not expected to be collected witl�in one yeai•of December 31,2014 are as
follows:
Contract Interfund Delinquent Special
for Deed Loan Property Assessments
Receivable Receivable Taxes Receivable Total
Major Funds:
General $ - $ - $20,579 $41 $20,620
2009A G.O.Refunding - - - 794,157 794,157
Transit Station Assessment Fund - - - 458,349 458,349
Revolving Assessment Fund - - - 1,437,083 1,437,083
Water - 368,797 - 129,863 498,660
Sewer - - - 11,820 11,820
NomnajorFunds ],287,575 - - 80,940 1,368,515
$1,287,575 $368,797 $20,579 $2,912,253 $4,589,204
CONTRACT FOR DEED RECEIVABLE
During 2012,the City sold its old public works building for$1,475,000. The City received$30,000 at the time
of closing,and entered into an agreement to collect the reinaining amount due,plus 5%interest,in inonthly
payments tht•ough July 2017 as follows:
Year Ending Principal
December 31, Amount Due
2015 $39,493
2016 29,373 ,
2017 1,25 8,202 '��
Total $1,327,068
59
-
CITY OF CHANHASSEN,MINNESOTA ��
NOTES TO FINANCIAL STATEMENTS I,
December 31,2014 I
Note 4 UNAVAILABLE REVENUE '
Governmental funds reporC deferred inflows of j-esow•ces in connection with receivables of revenues that are
not considered to be available to liquidate liabilities of the current period. At December 31,2014,the various '
components of unavailable revenue were as follows:
Major Funds
2009A Transit
G.O. Station Revolving
General Refunding Assessment Assessment Nonmajor
Fund Bonds Fund Fund Funds Total
Delinquent property taxes receivable $68,073 � - $ - � - $1,796 $69,869 �
Special assessments not yet due 2,001 799,977 556,676 1,754,734 90,061 3,203,449
Other 3,764 - - 6,209 3,420 13,393
Total unavailable revenue $73,838 $799,977 $556,676 $1,760,943 $95,277 $3,286,711
Note 5 CAPITAL ASSETS
Capital asset activiry for the year ended December 31,2014 was as follows:
Beginning Ending
Primar,y Government Balance Increase Decrease Balance
Goveimnental activities:
Capital assets not being depreciated:
Land $]9,792,789 $ - ($535,972) $19,256,817
Constructioninprogress 1,961,177 1,690,948 (1,007,674) 2,644,451
Pennanenteaseinents 922,670 233,280 - 1,]55,950
Total capital assets not being depreciated 22,676,636 1,924,228 (1,543,646) 23,057,2]8
Capital assets being depreciated:
Buildings and structui•es 22,858,759 7,]15 - 22,865,874
Machine�y and equipment 8,308,887 474,046 (238,300) 8,544,633
Temporaiy easements 12,931 - - 12,931
Other improvements 6,680,735 476,883 - 7,157,618
Infrastiucture 112,664,246 479,ll4 - 113,143,360
Total capital assets being depreciated 150,525,558 1,437,158 (238,300) 151,724,416
Less acciunulated depreciation for:
Buildings and structures 6,149,264 559,807 - 6,709,071
Machinery and equipment 5,721,355 477,023 (178,640) 6,019,738
Temporary easements 6,017 6,915 - 12,932
Other improvements 2,669,326 286,930 - 2,956,256
Infi•astiucture 71,850,922 3,642,232 - 75,493,154
Total accumulated depreciation 86,396,884 4,972,907 (178,640) 91,191,151
Governmenta]activities eapital assets-net $86,805,310 ($1,611,521) ($1,603,306) $83,590,483
60
CTTY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Beginning Ending
Primary Government Balance Increase Decrease Balance
Business-type activities:
Capital assets not being depreciated:
Land $2,072,635 $4,400 $ - $2,077,035
Constructioninprogress 2,698,816 1,152,250 (2,250,844) 1,600,222
Permanenteasements 835,483 320,984 - 1,]56,467
Tota]capital assets not being depreciated 5,606,934 ],477,634 (2,250,844) 4,833,724
Capital assets being depreciated:
Buildin�s and structures 12,445,429 - - 12,445,429
Macl�ineiy and equipment 1,419,697 138,983 (39,006) 1,519,674
Temporaiy easeinents 34,728 - (34,728) -
Otl�eriuiprovements 101,6ll,932 2,865,587 (35,955) 104,441,564
Total capita]assets being depreciated 115,511,786 3,004,570 (109,689) 118,406,667
L,ess accumulated depreciation for:
Buildings and sriuchu�es 1,494,163 248,918 - 1,743,081
Machineiy and equipment 924,172 79,045 (33,449) 969,768
Temporary easements 34,728 - (34,728) -
Other improvements 54,592,367 2,944,261 (35,955) 57,500,673
Total accwnulated depreciation 57,045,430 3,272,224 (104,132) 60,213,522
Business-type activities capital assets-net 64,073,290 1,209,980 (2,256,401) 63,026,869
Total capital assets-net $150,878,600 (�401,541) ($3,859,707) $146,617,352
Depreciation expense was charged to functions/programs of t17e City as follows:
Govermnental activities:
General government $358,673
Public safety 152,078
Public works 3,566,500
Parks and recreation 895,656
Total depreciation expense-goveinmental activities $4,972,907
Business-type activities:
Water $1,497,666
Sewer 952,259
Surface water management 822,299
Total depreciation expense-business-type activities $3,272,224
61
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Note 6 CITY INDEBTEDNESS
The City issues general obligation bonds,to provide funds for the acquisition and const�•uction of major capital
facilities. The reporting entity's long-term debt is segregated between the amounts to be repaid fi•om
governmental activities and amounts to be repaid from business-type activities.
GOVERNMENTAL ACTIVITIES
As of December 31,2014,the goveinmental activities long-terin debt of the City consisted of tl�e following:
Final Autl�orized
Issue Maturity Interest And Outst�anding
Date Date Rate Issued l2/31/14
General Long-Term Debt:
General Obligation Bonds:
G.O.Capital Improvement Plan Bonds,Series 2008A l l/18/08 2/O1/30 4.00%-4.60% $7,550,000 $6,505,000
G.O.Libraiy Refunding Bonds,2010A 1/27/10 2/O]/22 2.00%-3.10% 3,660,000 3,045,000
Total general obligaUon bonds 11,210,000 9,550,000
Tax Increment Bonds:
G.O.Tax Increinent Refunding Bonds,Series 2004C 8/10/04 2/O1/2] 3.00%-6.00% L,170,000 635,000
General Obligation Iinprovement Bonds:
G.O.Improvement Refimding Bonds,Series 2009A 6/03/09 2/O1/17 3.00% 6,020,000 1,705,000
Compensated absences payable N/A 791,637
Total City indebtedness-governmental aetivities $18,400,000 $12,681,637
BUSINESS-TYPE ACTIVITIES
As of December 31,2014,the business-type activities long-term debt of the City consisted of the following:
Final Authorized
Issue Mahu7ty Interest And Outstanding
Date Date Rate Issued ]2/3]!14 �
G.O.Revenue Bonds
Water Revenue Bonds,Series 2011A 10/6/2011 2/1/2022 0.30%-2.]5% $5,920,000 $5,055,000
Water Revenue Refunding Bonds,Se�ies 2011B l0/6/2011 2/1/2025 2.00%-3.00% 3,720,000 3,720,000 ��
Water and Sewer Revenue Bonds,Series 2012A ]1/I S/2012 2/1/2023 1.00%-1.55% 1,245,000 1,130,000 �
Bond premimn 182,339 140,261 ��
Total G.O.revenue bonds 11,067,339 10,045,261 I
Compensated absences payable N/A 172,794 I
Total City indebtedness-business-type activities �11,067,339 $10,218,055
62
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
GOVERNMENTAL ACTIVITIES
Annual debt service requirements to matur•ity for the gover•nmental activities long-te�m debt are as follows:
General Obligation Bonds G.O.Imps�ovement Bonds G.O.Tax Increment Bonds
Year Ending Govel�ninental Activities Governmental Activities Govermnental Activities
December 31, Principa] Interest Principal lnterest Principal lnterest
2015 $625,000 $356,848 $550,000 $42,900 $75,000 $34,005
2016 640,000 337,111 565,000 26,175 80,000 29,895
2017 670,000 315,298 590,000 8,850 85,000 25,440
2018 695,000 291,648 - - 90,000 20,580
2019 725,000 266,964 - - 95,000 15,308
2020 755,000 241,053 - - 100,000 9,600
2021 780,000 213,948 - - 110,000 3,300
2022 815,000 185,370 - - - -
2023 405,000 162,014 - - - -
2024 425,000 144,270 - - - -
2025 445,000 125,454 - - - -
2026 465,000 105,545 - - - -
2027 490,000 84,413 - - - -
2028 510,000 62,035 - - - -
2029 540,000 38,275 - - - -
2030 565,000 12,995 - - - -
Total $9,550,000 $2,943,241 $1,705,000 $77,925 $635,000 $138,128
It is not practicable to determine the specific year for payment of long-term accrued compensated absences.
The City has issued General Improvement Bonds to provide funds for various construction projects. In case of
a default by pr•operty owners,the City ean place a lien on the property in order to recover the default.
63
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
Dece�nber 31,2014
BUSINESS-TYPE ACTNITIES
Annual debt service require�nents to maturity for the business-type long-term debt are as fbllows:
G.O.Revenue Bonds
Year Ending Business-Type Activities
December 31, Principal Interest
2015 $775,000 $186,463
2016 805,000 180,541
2017 815,000 172,300 �
2018 835,000 162,228
2019 1,290,000 145,828
2020 1,310,000 120,679 ��,
2021 1,355,000 90,821 '�
2022 920,000 63,634 '
2023 670,000 42,971
2024 555,000 25,575 �
2025 575,000 8,625
Total $9,905,000 $1,199,665
It is not practicable to determine tl�e specific year for payment of long-teim accrued compensated absences.
64
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
CHANGE IN LONG-TERM LIABILITIES
Long-term liability activity for the year ended December 31,2014 was as follows:
Beginning Ending Due Within
Balance Additions Deletions Balance One Year
Govermnental acrivities:
Bonds payable:
General obligation bonds $10,155,000 $ - ($605,000) $9,550,000 $625,000
G.O.improvement bonds 5,220,000 - (3,515,000) 1,705,000 550,000
G.O.tax inc}•ement bonds 705,000 - (70,000) 635,000 75,000
Total bonds payable 16,080,000 - (4,190,000) 11,890,000 1,250,000
Coinpensated absences 794,233 593,09�} (595,690) 791,637 86,173
Total governmental activity
long-tei�n liabilities $16,874,233 $593,094 ($4,785,690) $12,681,637 $1,336,173
Business-type activities:
G.O.revenue bonds $16,170,000 $ - ($6,265,000) $9,905,000 $775,000
Bond premium 154,287 - (14,026) 140,261 14,026
Compensated absences 161,004 115,507 (103,717) 172,794 18,810
Total business-type activity
]ong-teim liabilities $16,485,291 $115,507 ($6,382,743) $10,218,055 $807,836
For the governmental activities,compensated absences are generally liquidated by the General and Special
Revenue Funds.
All long-term bonded indebtedness outstanding at December 31,2014 is backed by the full faith and credit of
the City,including special assessment,tax increment and water revenue bond issues. Delinquent assessments
receivable at December 31,2014 totaled$2,151.
General Obligation Revenue Bonds are se3viced by the Sewer aud Water Enteiprise Funds and are carried as
debt of those funds. Other bonds are supported by various Debt Service Funds. All bonds ai•e backed by the
full faith,credit,and taxing power of the City.
NONEXCHANGE FINANCIAL GUARANTEE OF DEBT
On August 1,2014 the Carver County Community Development Agency,a legally separate entity fi•om the
City, issued$2,110,000 of Housing Development Refunding Bonds,Series 201�}and$2,370,000 of Taxable
Housing Development and Refunding Bonds, Series 2014T. The pi•oceeds were used to r•efund a por-tion of
prior bonds and to fund certain capital improvements of the Centennial Hill Apartments,which are located
within the City.
I»accordance with Minnesota Statutes, Section 469.034, Subd.2,the City has pledged its full faith and credit
and taxing power•s to the payment of debt service on the Series 2014 and Series 2014T bonds. In the event that
the Carver County Commwlity Develop�nent Agency is unable to pay the debt service on the bonds due to
insufficient housing revenues and cash reserves,the City is obligated to pay the debt service. The City's
guarantee extends until the bonds have fully matured,which is scheduled to occur in 2034. The total amount of
outstanding guaranteed debt,including interest,at December•31,2014 is$6,159,504.
65
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
The City's management does not expect the city will be required to make any debt se�vice payments towards
these bonds. Accordingly,tl�e bonds are not reflected in the financial statements of the City.
REVENUE PLEDGED
Future revenue pledged for the payment of long-term debt is as follows:
Rcvc+uic PIa1gM Curtau Yc�c
Pcrcpn of Debi suvicc Rcwafning P�incipul PIaIgM
Useof 7ntul as,%of Tennoi' Principal anAlnleresl Revenuc �
Bond l.z.zuc ProcecdE 7ype Debl Scrvice nu revenucs Pl�lge anA Inleru�s� Paid Rwcival ,
20USAC]Phnnd. PnbGcWorkxPnclilyconstmc�ion Pinpcnylnxcs 100% n/n 20U9-2029 S9,U67,(149 5559,3CR 5592,100 �',
2010ALibraryRClLndingbonds Libnrvconslmclion PmpctYtaxas 100% n/a 2012-2U21 53,426,188 542U,805 5448,R80 ��'
-rcf mdect ihc 2002A Libnry bond��
2004CTIFReCundinghonAc DownlownRplevelapmuilProl�t TuxinermnG�t ]00% n/a 2UI14-21121 S773,12fS 5107,775 SJ()7,775
2009AIinprovemen7RefnndingbonAs Infrasiruclureimprovemwis Sper.fnlass�ssmi�ns 6R% n/a 2U09-2017 S1,7R2,925 53,618,875 5352,R59
-refnndul ihc 2005A B 2006A bonds Propcaly lax�.s 32%
2011AWaterRev�mebonAs Watcrfn4asimcmrcimprovcmcros Walansagcchargur 100% 27.R% 2U12-2021 55,373,835 5715,850 52,577,307
-iCf mdal II�C 2005B bonds
2UIIIIWaic��RcvGwebonds WmerfnGaslmclurcimprove�nenis Wa�eensagecharg�s J00% 4.7% 2012-2024 54,575,100 5106,000 52,571,303
-refimdal IIIC 20115B bonds
2012AWntcr&SavcrRovc�mc Purchascofinet�rmndingcquipmc�v Walcrands�nvcr 100% 2.6% 2013-2022 51,195,728 5128,715 SS,U30,781
BonAs usage cl�nrgcs
Note 7 DEFERRED AD VALOREM TAX LEVIES-BONDED DEBT
General obligation bond issues sold by the City are financed by ad valorem tax levies. Special assessment bond
issues sold by the Ciry are pai-tially financed by ad valorem tax levies in addition to special assessinents levied
against the benefiting properties. When a bond issue to be financed partially or completely by ad valorem tax
levies is sold,specific annual amounts of such tax levies are stated in the bond 3•esolution and the County
Auditor is notified and instructed to levy these taxes over the appropriate years. The future tax levies ar•e
subject to cancellation when and if the Ciry has provided alternative sources of financing. The City Council is
required to levy any additional taxes found necessaiy foi•full payment of principal and interest.
These futm•e scheduled tax levies are not shown as assets in the accompanying financial statements at
December 31,2014.
Future scheduled tax levies for all bonds outstanding at December 31,2014 totaled$12,797,960.
66
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Note 8 PENSION PLANS
A. PUBLIC EMPLOYEES RETIREMENT ASSOCIATION(PERA)
PLAN DESCRIPTION
All full-time and certain part-time employees of the City ar•e covered by defined benefit plans administered
by the Public Employees Retirement Association of Mimlesota(PERA). PERA administe�s the General
Einployees Retirement Fund(GERF)and tl�e Public Employees Police and Fire Fund(PEPFF)which are
cost-sl�aring,multiple-employer retirement plans. These plans are established and administered in
accordance with Mifanesota Statute,Chapters 353 and 356.
GERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated Plan members are
cove3•ed by Social Security and Basic Plan members are not. All new members must participate in the
Cooi•dinated Plan. All police officers,firefighters and peace officers who qualify for membership by
statute are covered by the PEPFF.
PERA provides retirement benefits as well as disability benefits to members,and benefits to survivors
upon deatl�of eligible members. Benefits are established by State Statute,and vest after five years of
credited service. The defined retii•ement benefits are based on a member's highest average salary for any
five successive years of allowable service,age,and years of credit at termination of service.
PERA issues a publicly available financial report that includes financial statements and required
supplementa�y information for GERF aud PEPFF. That report may be obtained on the internet at
www.innpera.org,by wi•iting to PERA,60 Empire Drive#200, St.Paul,Minnesota, 55103-2088 oi•by
calling 651-296-7460 or 1-800-652-9026.
B. FUNDING POLICY
Minnesota Statutes Chapte�•353 sets the rates for employer and employee contriburions. These
statutes are established and amended by the state legislature. Tl�e City makes annual contributions to
the pension plans equal to the amount required by state statutes. GERF Basic Plan members and
Coordinated Plan members wer•e r•equired to contribute 9.10%and 6.25%,respectively,of their annual
covered salary in 2014. PEPFF members were required to contribute 10.2%of their annual covered
salaTy in 2014. The City was requu�ed to contribute the following percentages of annual covered
payi•oll in 2014: 11.78%for Basic Plan GERF membei•s,7.25%for Coordinated Plan members, and
15.3%for PEPFF members. The City's contributions to the Public Employees Retirement Fund for
the years ending Deceinber 31,2014,2013 and 2012 were$338,623,$327,268,and$318,411,
respectively. The City's cont�•ibutions to the Public Employees Police and Fii•e Fund for the years
ending December 31,2014,2013 and 2012 were$21,822,$17,883,and$18,444,respectively. The
City's contributions were equal to tlie conti•actually reyuired contributions for each yeai•as set by state
statute. Contribution rates will increase ari Januaiy 1,2015 in the Coordinated Plan(6.5%foi•
members and 7.5°/o for employers)and in the Police and Fire Fund(10.8%for members and 16.2%for
employers).
67
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
C. CHANHASSEN FIRE RELIEF ASSOCIATION
PLAN DESCRIPTION
The volunteer firefighters of the City are inembers of the Chanhassen Fire Department Relief
Association. Tbe Chanhassen Fir•e Deparhnent Relief Association is the adminisn•ator of a single
employer defined benefit Public Employee Retirement System(PERS)established to provide benefits �
for members of the Chanhassen Fire Department. Plan provisions are established and may be '
amended by the Relief Association's Boa�•d of Tt•ustees within the guidelines of the State of Minnesota
statutes.
The Relief Association provides retirement and disability benefits to�nembers,and benefits to
swvivors upon death of eligible inembers. All benefit provisions,and the obligation to make
contributions,ar•e established and adininistered in accordance with Minnesota Statutes.
The Relief Association issues a publicly available financial report that includes financial statements
and required supplementaiy information. That report may be obtained by writing to Chanhassen Fire
Department Relief Association,P.O.Box 97,Chanhassen,MN 55317.
FUNDING POLICY
Minnesota Statutes Chapter 69.772 specifies minimum support rates required on ai1 annual basis. The
minimum support rates from the municipality and from State aid are determined as the amount
requi3•ed to meet the narmal cost plus amortizing any existing priar service costs over a ten-year
period. The significant actuarial assumptions used to compute the municipal support are the same as
those used to compute the accrued pension liability. The Relief Association is comprised of
volunteers,therefore,members have no contribution requirements. Dui�ing the year,the City
recognized as revenue and as an expenditure an on-behalf payment of$161,491 made by the State of
Minnesota for the Relief Association. The City's annual pension cost for the cun�ent year and related
infarmation for the plan is as follows:
Annual pension cost $206,046
Contributions inade:
City 44,555
State aid 161,491
Actuarial valuation date 12/31/14
Actuarial cost lnethod Enhy age nonnal
Amortization method Level dollar open
Remaining amortization period:
Normal cost 20 years
Prior se�vice cost 10 yeats
Asset valuation method Mar•ket
Actuarial assumptions:
Investment rate of return 5%
Projected sala�y increases N/A
Includes inf7ation at N/A
Cost of living adjustments None
68
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
THREE YEAR TREND INFORMATION
Annual Percentage Net
Year Pension of APC Pension
Ending Cost(APC) Contributed Obligation
12/31/2012 $161,202 100% $ -
12/31/2013 167,163 100% -
12/31/2014 206,046 100% -
REQUIRED SUPPLEMENTARY INFORMATION
Assets in
Excess of/ Pension
Actuarial Actuarial Actuarial (Unfunded) Benefit
Valuation Value of Acci•ued Accrued Funded Per Year
Date Assets Liability Liability Ratio of Service
12/31/2012 $2,393,673 2,980,865 ($587,192) 80.3% $5,050
12/31/2013 2,551,904 2,803,000 (251,096) 91.0% 5,050
12/31/2014 '� � � * *
* 2014 inforination is not available
The Association is coinprised of volunteers;therefore,there are no payroll expenditures(i.e.,there are
no covered payroll amounts oi•percentage calculations).
Note 9 OTHER POST-EMPLOYMENT BENEFITS
A. PLAN DESCRIPTION
In addition to pi•oviding the pension benefits described in Note 8,the City provides post-employment
health care benefits(as defined in paragraph B)for retired employees through a single-employer
defined beuefit plan. The City's OPEB plan is administered by the City. The authority to provide
these benefits is established in Minnesota Statutes Sections 471.61 Subd.2a,and 299A.465. The
bene�ts,benefit levels,einployee contributions and employer contl•iburions are gover•ned by the City
and can be ainended by the City through its personnel manual and collective bargaining agreements
with employee groups. The Plan is not accounted for as a trust fund,as an irrevocable trust has not
been established to account far the plan. The Plan does not issue a separate report.
69
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
Dece�nber 31,2014
B. BENEFITS PROVIDED
Retirees
The City is required by State Statute to allow retirees to continue participation in the City's group
health insurance plan if the individual terminates se�vice with the City thr•ough service retirement or
disability retirement. Employees who satisfy the rule of 80 or attain age 55 and have completed 10
years of service at termination can immediately commence medical benefits. Rerirees may obtain
dependent coverage while the participating retiree is undei•age 65. Covered spouses may continue
coverage aftej•the retiree's death. The surviving spouse of an active employee may continue covei•age
in the group health insurance plan after the employee's death.
All health care coverage is provided through the City's group health insurance plans. The retiree is
requir•ed to pay 100%of their premium cost for the City-sponsored group health insurance plan in
wl�ich they participate. The premium is a blended rate determined on the entire active and retiree
population. Since the projected claims costs fo�•retirees exceed the blended premiuin paid by 3•etirees,
the retirees are receiving an iinplicit rate subsidy(benefit). The coverage levels are the same as those
afforded to active employees. Upon a retiree reaching age 65 years of age,Medicare becomes the
primaiy insurer and the City's plan becomes secondaiy.
C. PARTICIPANTS
As of the Januaiy 1,2014 actuai7al valuation,participants consisted of:
Retirees and beneficiaries cw•rently
purchasing health insurance through the City 1
Active employees 60
Total 61
Participating employers 1
D. FUNDING POLICY
The additional cost of using a blended rate for actives and retirees is currently funded on a pay-as-you-
go basis. The City Council may change the funding policy at any time.
70
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
E. ANNUAL OPEB COSTS AND NET OPEB OBLIGATION
The City's annual othe�•post employment benefit(OPEB)cost is calculated based on the annual
required contribution(ARC)of the employer,an amount actuarially deterinined in accordance with the
parameters of GASB Statement No.45. The ARC represents a level of funding that,if paid on an
ongoing basis,is projected to cover normal cost each year and amortize any unfunded actuarial
liabilities(or funding excess)over a period not to exceed 30 years. The net OPEB obligation as of
December 31,2014,was calculated as follows:
Annual required contribution(ARC) $13,175
Interest on net OPEB obligation 792
Adjustment to ARC (1,144)
Amival OPEB cost 12,823
Contributions made during the year (7,080)
Increase(decrease)in net OPEB obligation 5,743
Net OPEB obligarion-beginning of year 19,788
Net OPEB obligation-end of year $25,531 �
For governmental activities,the net OPEB obligarion is generally liquidated by the General Fund.
The City's annual OPEB cost,the percentage of annual OPEB cost contributed to the plan and the net
OPEB obligation for the previous three years was as follows:
Percentage of
Fiscal Year Annual OPEB Employer Annual OPEB Cost Net OPEB
Ended Cost Contributions Contributed Obligation
Decembei•31,2012 $9,100 $5,232 57.5% $15,536
December 31,2013 9,008 4,756 52.8% 19,788
December 31,2014 12,823 7,080 55.2% 25,531
71
CITY OF CHANAASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014 �
F. FUNDED STATUS AND FUNDING PROGRESS II
The City curreiltly has no assets that have been irrevocably deposited in a trust for future health
benefits,therefore,the actuai•ial value of assets is zero. The funded status of the plan was as follows:
Unfunded
Actuarial Actuaria] UAAL as a
Actuarial Actuarial Accrued Accrued Punded Covered Percentage of
Valuation Value of Assets Liability(AAL)* Liability(UAAL) Ratio Payroll Covered Payroll
Date (a) (b) (b-a) (a/b) (c) ((b-a)/c)
Januaiy 1,2014 $0 $116,025 $116,025 0.0% �4,568,337 2.5%
�`Using the projected unit credit actuarial pay cost�metliod.
G. ACTUARIAL METHODS AND ASSUMPTIONS
Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and
assuinptions about the probability of occm�rence of events fai•into the future. Examples include
assumptions about future employment, mortality and the health care cost trend. Amounts determined
regarding the funded status of the plan and the annual required contributions(ARC)of the employer
are subject to continual revision as actual results are compared with past expectations and new
estimates are made about the future. The sehedule of funding progress,presented as required
supplementary information following the notes to financial statements,presents multi-year ri•end
information that shows whether the actuarial value of plan assets is increasing or decreasing over time
relative to the actuarial accr•ued liabilities for benefits.
Projections of benefits for financial reporting purposes are based on tl�e substantive plan(the plan as
undeistood by the employer and plan members)and include the types of benefits provided at the tiine
of each valuation and ihe historical pattein of sharing of benefit costs between the employer and plan
members to that point. The actuarial methods and assumptions used include techniques that are
designed to reduce the effect of short-term volariliry in actuarial aeerued liabilities and the actuarial
value of assets,consistent with the long-term perspective of the calculations.
In the January l,2014 actuarial valuation,the pi•ojected unit cr•edit actuarial cost method was used.
Tlle actuarial assumptions included a 4.0°/o investment rate of return(net of adminisri•ative expenses)
and an annual health care cost trend rate of 8.0°/o for 2015,decreasing by 0.5%annually to an ultimate
rate of 4.0°/o. These rates include a 3%inflarion rate. The actuarial value of assets was$0. The plan's
unfunded actuarial accrued liability is being amortized using the level percentage of projected payroll
method over 30 years on a open basis. The remaining amortization per•iod at December 31,2014 was
30 years.
72
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Note 10 INTERFUND LOAN RECEIVABLE/PAYABLE AND TRANSFERS
Amounts reported as interfund receivable/payable at December 31,2014 are as follows:
Fund Receivable Payable
Transit Station Assessment Fund $ - $466,933
Water Fund 466,933 -
Total $466,933 $466,933
During 2010,the City adopted resolution 2010-16A authorizing an interfund loan for advance of certain costs
in connection with the Transit Station Public Improvement Project. The Transit Station Assessment Fund
borr�owed$729,253 from tlle Water Fund. Repayments,including interest,will be made as funds become
available. Tl�ere were$92,582 of repayinents in 2014 and$98,136 is expected to be 3�epaid in 2015.
Interfund transfers:
Transfers Transfers
In Out
Gener•al Fund $ - $450,810
2009A G.O.Refunding Bonds 63,285 -
Transit Station Assessment Fund - 35,275
Revolving Assessment Pund 1,179,567 -
TH101 Imp.-Lyman to Pioneer• 249,198 -
Nonmajor government funds 291,669 190,010
Water Fund 45,275 738,429
Sewer Fund - 125,204
Surface Water Management Fund - 289,266
Total $1,828,994 $1,828,994
Interfund transfers allow the City to allocate financial resources to the funds that receive benefit from services
provided by anotl�er fund. All of the City's interfund t�•ansfers fall undei•that category. All of the 2014
transfers are considered routine and consistent with previous practices.
Note 11 CONDUIT DEBT
From ri�ne to time,the City has issued conduit debt to provide financial assistance to private-sector enrities for
the acquisirion and construction of faciliries deemed to be in the public interest. Tl�e bonds are secured by the
property financed and are payable solely from payments received on the underlying mortgage loans. Upon
repayment of the bonds,ownership of the acquired facilities transfers to the private-sector entity served by the
bond issuance. Neither the City,the State,noi•any political subdivision thei•eof is obligated in any manner for
the repayment of the bonds. Accordingly,the bonds are not t•eported as liabilities in the accoinpanying
financial stateinents.
73
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS ;
December 31,2014 �
As of December 31,2014,the outstanding conduit debt is as follows:
Bonds Original 12/31/14 Maturiry
Project Naine Issued Principal Principal Date
Chapel Hill Academy,Series 2005A 12/05 $1,337,700 �563,424 2019
St.Hubert Catholic Commwliry,Series 2007 10/07 5,942,140 3,535,917 2027
Presbyterian Homes,Series 2014B 06/14 9,300,000 9,126,021 2034
Note 12 DEFICIT FUND BALANCES
The City has deficit fund balances of$466,933 in the Transit Station Assessment Capital Project Fund and
$8,4]9 in the TH101 Improvements—Pioneer to Flying Cloud Capital Project Fund at December 31,2014.
The deficits will be eliminated through special assessment collections a��d transfers.
Note 13 COMMITMENTS AND CONTINGENCIES
A. RISK MANAGEMENT
The City is exposed to various risks of loss related to torts;theft of,damage to,and destruction of assets;
e��•ors and omissions;injw•ies to e�nployees;and natur•al disasters. The City continues to carry commercial
insurance far risks of loss,iucluding workers colnpensation,property a�1d general liability and employee
health and accident insurance. There were no significant reductions in insurance from the previous year or
settlements in excess of insurance cove3•age for any of the past tl�ree fiscal years.
B. LITIGATION
Any existing and pending lawsuits, claims and other actions in which the City is a defendant are eitlier
covered by insurance;of an immaterial amount;or,in the judgment of the City's management,are
relnotely recoverable by plaintiffs.
C. WESTERN AREA FIRE TRAINING ACADEMY
A potential claim may be asserted against the City arising out of its membership in the Western Area
Fire Training Academy(WAFTA).WAFTA is a joint powers entity consisting of 11 member cities
that was formed in 1974 to purchase property to be used and operated as a fire training facility.In the
late 1980's,WAFTA became aware that the site was contaminated. Since that time,WAFTA has been
working with the Minnesota Pollution Control Agency(MPCA)and othei•responsible parties to
address the contaminarion issues on the site. At this time,the City's share of the potential cost to
remediate the site cannot be deteimined,nor has a claim been asse3-ted against WAFTA or tl�e City.
Based on�•ecent studies of the site,it is Management's belief that the amount of any potential claim is
not material to the financial statements.
74
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
D. FEDERAL AND STATE FUNDS
The City receives financial assistance from federal and state governmental agencies in the foim of
grants. The disbw•sement of funds received under these programs generally requires compliance with
the tei•ins and conditions specified in the gi•ant agreements and is subject to audit by the grantor
agencies. Any disallowed claims resulting from such audits could become a liability of the applicable
fmid. However,in the opinion of management,any such disallowed claims will not have a material
effect on any of the financial statements of the individual fund types included herein or on the overall
financial position of the City at December 31,2014.
E. TAX INCREMENT DISTRICTS
The City's tax increment districts ai•e subject to review by the State of Minnesota Office of the State
Audito3•(OSA). Any disallowed claims or misuse of tax increments could become a liability of the
applicable fund. Management has indicated that tliey a3•e not aware of any instances of noncoinpliance
which would have a material effect on the financial statements.
As of Decelnber 31,2014,the City had one outstanding tax inci•ement pay-as-you-go revenue note.
The note is not a general obligation of the City and is payable solely from tax increme»ts.
Accordingly,the note is not r•eflected in the flnancial statements of the City. Details of the pay-as-you-
go revenue note is as follows:
Taxable Tax Increment Revenue Note, Series 2006A(Gatewav Place)—issued in 2006 in the principal
sum of$300,000 with an interest rate of 0%per annum. Semi-annual principal pay�nents shall be paid
commencing August 1,2009 and continuing through February 1,2016. Payments are payable solely
from available tax increment,which term means 90°/o of the tax increment that is received by the Ciry
in the six month period immediately before each payment date through February 1,2014 and 65%
fi•om August 1,2014 through Februai•y 1,2016. The City shall]lave no obligation to pay unpaid
balance that may remain after the final payment on Februaiy 1,2016. At December 31,2014 the
principal amount outstanding on the note was$209,856.
F. COMMITTED CONTRACTS
At December 31,2014,the City had commitments of$226,553 for uncompleted construcrion
contracts. In addition,the City has entered into five construction contracts during 2015 totaling
$4,127,621.
75
CITY OF CI�ANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Note 14 FUND BALANCE
A. CLASSIFICATIONS
Definitions of fund balance classifications are included in Note 1P. At December 31,2014,a
summary of the governmental fund balance classi�ications are as follows:
Transit
2009A G.O. Station Revolving Other
General Refunding Assessment Assessment TH 101 Governmental
Fund Bonds Fund Fund Improvements Funds Total
Nonspendable:
Prepaid items �58,333 $ - $ - $ - � - $2,000 �60,333
Contract for deed receivable - - - - - 1,287>575 1,287,575
Tota]nonspendable 58,333 0 0 0 0 1,289,575 1,347,908
Restricted f'or:
Debt se�vice - 1,300,476 - - - 1,530,306 2,830,782
Park i�nprovements - - - - - 1,751,739 1,751,739
Tax increment pwposes - - - - - 965,809 965,809
CATV-public education - - - - - 128,693 128,693
Publie safery-fire - - - - - 47,396 47,396
Total restricted 0 ],300,476 0 0 0 4,423,943 5,724,419
Assigned for:
Capital improvements - - - 2,020,972 1],596 2,959,992 4,992,560
Cablecommunications - - - - - 207,112 201,112
Cemetery operations - - - - - 27,418 27,418
Debt service rese�ve - - - - - 730,417 730,417
Total assigned 0 0 0 2,020,972 11,596 3,918,939 5,951,507
Unassigned 5,550,732 - (466,933) - - (8,419) 5,075,380
Total $5,609,065 $1,300,476 ($466,933) $2,020,972 �11,596 �9,624,038 $18,099,214
B. MINIMUM UNASSIGNED FUND BALANCE POLICY
The Ciry Council has formally adopted a policy regarding the minimum unassigned fund balance far
the General Fund. The most significant revenue sow•ce of the General Fund is pi•operty taxes. This �
revenue sow•ce is received in two installments dw•ing the year—June and December. As such, it is the �
City's goal to begin each fiscal year with sufficient working capital to fund operations between each �
semi-a�lnual reeeipt of property taxes.
The City's fund balance policy states the year end General Fund balance shall be sufficient to cover
50% of the property taxes budgeted to be received during the following year. At December 31,2014,
the fund balance of the General Fund exceeded this level.
76 II�
CITY OF CHANHASSEN,MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31,2014
Note 15 LEASE REVENUE
The City receives revenue from agreements for the lease of space above its watez•towers and on City property
to communication companies. The space is used for antennas and other equipment necessa�y to provide radio
communications. For accounting pwposes,the leases are considered operating leases. Lease revenue for the
year ended Deceinber 31,2014 totaled$180,613. Terms of each lease outstanding at year end are as follows:
Lessee Terms Cuirent Term
Sprint $25,082 per year with 3%annual increases 8/1/ll -7/31/16
Spi•int $23,486 per yeai•with 3%annual increases 12/1/10- 11/30/15
Verizon $2,068 per month 8/1/13 -4/30/17
Nextel West Corp. $22,926 per year with 3%annual increases 12/1/14- 11/30/19
T-Mobile $2,153 per month witl�3%annual increases 11/1/10- 10/31/15
T-Mobile $22,258 per year with 3%annual increases 1/1/14- 12/31/19
StoneBr•idge/Nextera 5%of gross revenues associated with equipment used on property 1/1/15 - 12/31/19
Cingular/AT&T $2,029 per month with 3%annual increases 8/U12-7/31/17
Note 16 RECENTLY ISSUED ACCOUNTING STANDARDS
The Goveriunental Accounting Standards Boards(GASB)recently approved tl�e following statements which
were not iinplemented for these financial stateinents:
Statement No.68 Accounting and Financial Reporti�ng for Pefisions—arr amendnaent of GASB Statement
27.The pl•ovisions of this Statement are effective for financial statements for periods beginning after June
15,2014. Statemeilt No.68 requires governments providing defined benefit pensions to 1•ecognize their
long-te3•in obligarion for pension benefits as a liability for the first time.
Statement No.71 Pension Tr-ansition for Contribz�tions Made Subsequent to the Measurement Date—an
amendment of GASB Stazement No. 68.The provisions of this Statement should be applied simultaneously
with the provisions of Statement 68.
Statement No.72 Fair Value Measurement and Application.The provisions of this Statement are effective
far financial statements for periods beginning after June 15,2015.
The effect these standards may have on future financial statements is not detenninable at this tiine,but it is
expected that Statements No. 68 and No.71 will have a material impact.
77
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78
REQUIRED SUPPLEMENTARY INFORMATION
��
CITY OF CHANHASSEN,MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION Statement 10
BUDGETARY COMPARISON SCHEDULE-GENERAL FUND Page 1 of 6
For The Year Ended December 31,2014
With Comparative Actual Amounts For The Year Ended December 31,2013
2014 2013
Budgeted Amounts Actual Variance with Actual
Original Final Amounts Final Budget Amounts ,
Revenues:
General property taxes $7,629,950 $7,629,950 $7,652,802 $22,852 $7,457,293
Excess tax increment received - - 132,358 132,358 -
Total general property taxes 7,629,950 7,629,950 7,785,160 155,210 7,457,293
Licenses and permits:
Licenses-genej•al government 4,000 4,000 4,600 600 3,600
Licenses-public safety 95,500 95,500 97,549 2,049 98,108
Pennits-public safety 859,500 859,500 1,113,462 253,962 1,169,970
Permits-public works 33,000 33,000 44,557 11,557 46,427
Pezmits- community development 6,500 6,500 4,095 (2,405) 6,665
Total licenses and permits 998,500 998,500 1,264,263 265,763 1,324,770
Intergover•nmental:
State aid-police-public safety 110,000 110,000 138,305 28,305 127,134
State aid-fire-public safety 110,000 ll0,000 164,566 54,566 169,106
PERA-public safety 20,000 20,000 19,467 (533) 19,589
Otl�er 45,000 45,000 51,059 6,059 43,251
Total intergovernmental 285,000 285,000 373,397 88,397 359,080
Charges for services:
General government 76,350 76,350 77,215 865 76,954
Public safety 8,000 8,000 6,768 (1,232) 7,492
Public works 52,500 52,500 71,130 18,630 91,052
Park and recreation 422,350 422,350 416,846 (5,504) 416,850
Community development 11,700 11,700 35,805 24,105 30,696
Total chaj•ges for services 570,900 570,900 607,764 36,864 623,044
Fines and forfeits:
Public safety 122,500 122,500 100,516 (21,984) 99,984
Refunds and reimbursements:
General government 17,250 17,250 16,034 (1,216) 6,915
Public safety 4,650 4,650 4,096 (554) 8,518
Public works 38,600 38,600 45,553 6,953 56,796
Park and recreation 14,500 14,500 3,556 (10,944) 10,630
Community development - - 41 41 222
Total refunds and reimbursements 75,000 75,000 69,280 (5,720) 83,081
Investment earnings 45,000 45,000 54,140 9,140 44,959
Net change in fair value of investments - - (1,919) (1,919) (50,077)
Conn�ibutions and donations:
General government 250 250 600 350 600
Public safety 250 250 200 (50) 320
Pa�•k and recreation 21,299 21,299 21,890 591 18,725
Total contributions and donations 21,799 21,799 22,690 891 19,645
Other:
General government $173,300 $173,300 $186,379 $13,079 $180,299
Public safety 7,000 7,000 5,342 (1,658) 6,401
Total other 180,300 180,300 191,721 11,421 186,700
Total revenues 9,928,949 9,928,949 10,467,012 538,063 10,148,479
80
CITY OF CHANHASSEN,MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION Statement 10
BUDGETARY COMPARISON SCHEDiTLE-GENERAL FiIND Page 2 of 6
For The Year Ended December 31,2014
With Comparative Actual Arnounts For The Year Ended December 31,2013
2014 2013
Budgeted Amounts Actual Variance with Actual
Original Final Amounts Final Budget Amounts
Expenditures:
General govei•nment:
Legislative:
Current:
Personal services 32,300 32,300 31,932 368 32,703
Contj•actual se�vices 77,000 77,000 75,257 1,743 89,495
Totallegislative 109,300 109,300 107,189 2,111 122,198
Administrative office:
Cun�ent:
Personal services 452,000 452,000 453,094 (1,094) 436,645
Materials and supplies 200 200 154 46 435
Contractual services 56,549 56,549 62,664 (6,115) 69,863
Total administrative office 508,749 508,749 515,912 (7,163) 506,943
Finance:
Cuirent:
Personal services 243,900 243,900 248,109 (4,209) 236,729
Materials and supplies 200 200 - 200 -
Contractual services 51,700 51,700 50,545 1,155 47,199
Total finance 295,800 295,800 298,654 (2,854) 283,928
Election:
Current:
Personal services 22,500 22,500 24,841 (2,341) -
Materials and supplies 3,500 3,500 5,481 (1,981) -
Contractual services 12,200 12,200 10,409 1,791 48
Total election 38,200 38,200 40,731 (2,531) 48
Legal:
Cwl�ent:
Contractual seivices 148,000 148,000 175,563 (27,563) 159,919
Property assessment:
Cu�rent:
Contractual seivices 130,000 130,000 132,379 (2,379) 123,590
M.I.S.:
Cw�•ent:
Personal services 192,000 192,000 188,959 3,041 182,569
Materials and supplies 30,700 30,700 26,629 4,071 31,238
Contt�actual se3vices 41,900 41,900 43,945 (2,045) 37,940
Total M.I.S 264,600 264,600 259,533 5,067 251,747
81
CITY OF CHANHASSEN,MII�TNESOTA
REQUIRED SUPPLEMENTARY INFORMATION Statement 10
BUDGETARY COMPARISON SCHEDULE-GENERAL FiJND Page 3 of 6
Far The Year Ended December 31,2014
With Compararive Actual Ainounts Far The Year Ended Decembel•31,2013 �
2014 2013 '
Budgeted Amounts Actual Variance with Actual �
Original Final Amounts Final Budget Amounts '
Expenditures: (continued) �
General government: (conrinued)
City hall:
Cui-rent:
Personal seivices $76,400 $76,400 $74,522 $1,878 $72,544
Materials and supplies 44,100 $44,100 41,417 2,683 36,862
Contractual seivices 287,100 287,100 276,275 10,825 273,134
Total City hall 407,600 407,600 392,214 15,386 382,540
Library:
Cui1•ent:
Materials and supplies 3,000 3,000 6,282 (3,282) 5,543
Cont��actual seivices 111,200 111,200 104,820 6,380 113,887
Totallibra�•y 114,200 114,200 111,102 3,098 119,430
Total general goveinment 2,016,449 2,016,449 2,033,277 (16,828) 1,950,343
Public safety:
Police:
Cun•ent:
Per-sonal services 70,200 70,200 71,040 (840) 68,415
Materials and supplies 3,000 3,000 3,002 (2) 2,378
Contractual se�vices 1,602,800 1,602,800 1,505,124 97,676 1,508,489
Total police 1,676,000 1,676,000 1,579,166 96,834 1,579,282
Fire department:
Cm�•ent:
Personal services 586,900 586,900 651,072 (64,172) 603,172
Materials and supplies 48,900 48,900 39,094 9,806 51,318
Conri•actual se3vices ll9,100 119,100 133,737 (14,637) 124,057
Total fire department 754,900 754,900 823,903 (69,003) 778,547
Code enforcement:
Current:
Personal se�vices 628,200 628,200 655,962 (27,762) 644,438
Materials and supplies 4,500 4,500 5,361 (861) 4,106
Conh-actual services 14,100 14,100 13,192 908 10,521
Total code enforcement 646,800 646,800 674,515 (27,715) 659,065
Animal control:
Current:
Personal services 59,600 59,600 50,981 8,619 46,218
Materials and supplies 3,800 3,800 3,558 242 1,131
Contractual se�vices 7,600 7,600 9,649 (2,049) 6,731
Total animal control 71,000 71,000 64,188 6,812 54,080
Total public safety 3,148,700 3,148,700 3,141,772 6,928 3,070,974
82
CITY OF CHANHASSEN,MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION Statement 10
BUDGETARY COMPARISON SCHEDULE-GENERAL FLTND Page 4 of 6
For The Year Ended December 31,2014
With Comparative Actual Amounts For The Year Ended December 31,2013
2014 2013
Budgeted Amounts Actual Variance with Actual
Expenditures: (conti�lued) Original Final Amounts Pinal Budget Amounts
Public works:
Engineering:
Current:
Personal services $570,700 $570,700 $572,245 ($1,545) $548,975
Materials and supplies 900 900 580 320 801
Contractual seivices 30,500 30,500 29,816 684 33,444
Total engineering 602,100 602,100 602,641 (541) 583,220
Street maintenance:
Current:
Personal services 704,700 704,700 737,620 (32,920) 691,097
Materials and supplies 114,600 114,600 115,882 (1,282) 1�}4,662
Contractual services 30,600 30,600 47,892 (17,292) 27,675
Total street maintenance 849,900 849,900 901,394 (51,494) 863,434
Sh�eet lighting:
Cu�rent:
Materials and supplies 3,000 3,000 2,319 681 4,070
Cont��actual seivices 348,500 348,500 331,604 16,896 347,149 �
Total street lighting 351,500 351,500 333,923 17,577 351,219 �I
City garage:
Current:
Personal services 277,500 277,500 277,004 496 281,424
Materials and supplies 211,100 211,100 205,661 5,439 191,268
Contractual services 68,200 68,200 70,368 (2,168) 66,386
Total City garage 556,800 556,800 553,033 3,767 539,078
Total public works 2,360,300 2,360,300 2,390,991 (30,691) 2,336,951
Parks and recreation:
Parks and reci•eation coininission:
Current
Materials and supplies 100 100 - 100 -
Contractual seivices 2,700 2,700 2,931 (231) 2,842
Total parks and recr�eation commission 2,800 2,800 2,931 (131) 2,842
Parks and recreation administration:
Current:
Personal se�vices 138,400 138,400 142,629 (4,229) 135,604
Materials and supplies 600 600 - 600 105
Contractual seivices 6,700 6,700 5,410 1,290 4,783
Total parks and recreation
administration 145,700 145,700 148,039 (2,339) 140,492
Recreation center:
Cun•ent:
Personal seivices 214,400 214,400 205,012 9,388 204,218
Materials and supplies 44,000 44,000 29,487 14,513 23,930
Contractual se�vices 82,400 82,400 71,520 10,880 93,171
Total reci�eation center 340,800 340,800 306,019 34,781 321,319
83
CITY OF CAANHASSEN,MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION Statement 10
BUDGETARY COMPARISON SCHEDiILE-GENERAL FiJND Page 5 of 6
For The Year Ended Dece�nbe3•31,2014
With Co�nparative Actual Amounts For The Year Ended December 31,2013
2014 2013
Budgeted Amounts Actual Variance with Actual
Original Final Amounts Final Budget Amounts
Expenditures: (continued)
Parks and recreation:(continued) �
Senior citizen center: ��
Current:
Personal services $49,800 $49,800 $48,830 $970 $47,407 ',
Materials and supplies 3,300 3,300 2,540 760 2,340 I
Contractual se�vices 19,900 19,900 24,899 (4,999) 20,983 '
Total senior citizen center 73,000 73,000 76,269 (3,269) 70,730
Recreation programs:
Cuirent:
Personal services 181,200 181,200 189,298 (8,098) 178,356
Materials and supplies 19,500 19,500 20,964 (1,464) 23,844
Contractual services 95,500 95,500 102,138 (6,638) 97,725
Total recreation pt•ogj•ams 296,200 296,200 312,400 (16,200) 299,925
Self-supporting programs:
Cu»•ent:
Personal services 33,900 33,900 35,400 (1,500) 32,939
Materials and supplies 7,200 7,200 2,989 4,211 2,907
Contractual services 24,000 24,000 17,021 6,979 21,645
Total self-supporting programs 65,100 65,100 55,410 9,690 57,491
Lake Ann Park operations:
Current:
Personal se�vices 8,700 8,700 8,637 63 8,117
Materials and supplies 8,200 8,200 9,536 (1,336) 14,328
Contractual services 43,800 43,800 41,493 2,307 40,952
Total Lake Ann Park opei�ations 60,700 60,700 59,666 1,034 63,397
Park maintenance:
Culrent:
Personal sejvices 788,800 788,800 829,738 (40,938) 807,849
Materials and supplies 81,100 81,100 72,974 8,126 80,491
Contractual sejvices 89,600 89,600 80,881 8,719 85,916
Total park maintenauce 959,500 959,500 983,593 (24,093) 974,256
Downtown maintenance:
Current:
Contractual services - - 3,081 (3,081) 2,641
Recreation spoj-ts:
Current:
Personal services 16,200 16,200 24,523 (8,323) 16,931
Materials and supplies 8,800 8,800 8,920 (120) 8,275
Contractual services 300 300 11 289 325
Total recj•eation sports 25,300 25,300 33,454 (8,154) 25,531
Total parks and 3•ecreation 1,969,100 1,969,100 1,980,862 (11,762) 1,958,624
84
CITY OF CHANHASSEN,MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION Statement 10
BUDGETARY COMPARISON SCHEDULE- GENERAL FIJND Page 6 of 6
For The Year Ended December 31,2014
With Colnparative Actual Amounts For The Year Ended December 31,2013
2014 2013
Budgeted Amounts Actual Variance with Actual
Original Final Amounts Final Budget Amounts
Expenditures (continued)
Community development:
Planning commission:
Cun•ent:
Personal services $ - $ - $1,907 ($1,907) $88
Materials and supplies 200 200 - 200 -
Contractual seivices 3,800 3,800 5,872 (2,072) 3,196
Total planning commission 4,000 4,000 7,779 (3,779) 3,284
Planning adininistration:
Current:
Personal services 384,300 384,300 392,286 (7,986) 374,345
Matei•ials and supplies 400 400 114 286 90
Contractual services 12,000 12,000 6,563 5,437 3,941
Total planning administration 396,700 396,700 398,963 (2,263) 378,376
Senior facility coimnission:
Cuirent:
Personal services 24,000 24,000 24,823 (823) 23,820
Contractual services 9,700 9,700 8,542 1,158 8,641
Total senior facility commission 33,700 33,700 33,365 335 32,461
Total community development 434,400 434,400 440,107 (5,707) 414,121 �
Total expenditures 9,928,949 9,928,949 9,987,009 (58,060) 9,731,013 '
Revenues over expenditures 0 0 480,003 480,003 417,466 II
Other financing sources(uses):
Sale of capita]assets - - 288,547 288,547 -
Transfers out - - (450,810) (450,810) (617,919)
Total other financing sources(uses) - - (162,263) (162,263) (617,919)
Net change in fund balance $0 $0 317,740 $317,740 (200,453)
Fund balance-Januaiy 1 5,291,325 5,491,778
Fund balance-December 31 $5,609,065 $5,291,325
Note A BUDGETARY INFORMATION
The General Fund budget is legally adopted on a basis consistent with accounring principles generally accepted in the United
States of America. The legal level of budgetary control is at the department level for the Gener•al Fund.
85
CITY OF CHANHASSEN,MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF FUNDING PROGRESS-RETIREE HEALTH PLAN
For The Year Ended Deceinber�31,2014
Unfunded
Actuarial Actuai•ial Actuarial UAAL as a
Actuarial Value of Accrued Accrued Funded Covered Percentage of
Valuation Assets Liability(AAL)* Liability(UAAL) Ratio Payroll Covered Payroll
Date (a) (b) (b-a) (a/b) (c) ((b-a)/c)
January 1,2008 $0 $52,268 $52,268 0.0% $4,180,235 1.3%
January 1,2011 $0 $89,875 $89,875 0.0% $4,299,466 2.1%
January 1,2014 $0 $116,025 $116,025 0.0% $4,568,337 2•5% �
*Using the projected unit credit actuarial pay cost method. ��
86
COMBINING AND INDIVIDUAL NONMAJOR FUND FINANCIAL
STATEMENTS AND SCHEDULES
s�
NONMAJOR GOVERNMENTAL FUNDS I',
il
I
I
I
gg
SPECIAL REVENUE FUNDS
The Special Revenue Funds are used to account for the proceeds of specific revenue sources that
are legally resn-icted to expenditures for specified puiposes.
DEBT SERVICE FUNDS
The Debt Service Funds are used to account for the accumulation of resources for, and payment
of, interest, principal and related costs on general long-term debt.
CAPITAL PROJECT FUNDS
The Capital Project Funds account for financial resoui•ces to be used for• the acquisition or
construction of major capital facilities (other than those financed by Proprietaiy Funds).
89
CITY OF CHANHASSEN,MINNESOTA
COMBINING BALANCE SHEET Statement 11
NONMAJOR GOVERNMENTAL FUNDS
December 31,2014
With Compar•ative Totals For December 31,2013
Totals
Nonmajor
Special Debt Capital Governmental Funds
Revenue Seivice Project 2014 2013
Assets:
Cash and investments $350,043 $2,246,153 $7,360,424 $9,956,620 $8,197,745
Accrued interest receivable 1,425 7,541 25,872 34,838 30,068
Due fi•om other governmental units 735 - 43,328 44,063 876,741
Accow�ts receivable-net 54,009 - 45,105 99,114 109,108 ,
Property taxes receivable - 7,029 9,532 16,561 14,854 I
Prepaid ite�ns - - 2,000 2,000 - 'i
Contract for deed 3•eceivable - - 1,327,053 1,327,053 1,372,668 I
Special assessments receivable - 82,275 7,786 90,061 705,719
Total assets $406,212 $2,342,998 $8,821,100 $11,570,310 $11,306,903
Liabilities,Defen•ed Inflows of Resow•ces,and Fund Balance
Liabilities:
Accountspayable $ - $ - $212,1A6 $212,146 $186,670
Due to other govei•nmental units - - - - 1,131
Salaries payable 1,593 - - 1,593 2,435
Cont3-acts payable - - 104,391 10�4,391 160,942
Due to other funds - - 14,950 14,950 -
Interfund payable - - - - 559,515
Unearned i•evei�ue - - 1,517,915 1,517,915 526,449
Total liabilities 1,593 0 1,849,402 1,850,995 1,437,142
Defen•ed inflows of resources:
Unavailable revenue - 82,275 13,002 95,277 706,310
Fund balance:
Nonspendable - - 1,289,575 1,289,575 1,327,068
Resri�icted 176,089 1,530,306 2,717,548 4,423,943 4,688,037
Assigned 228,530 730,417 2,959,992 3,918,939 3,707,861
Unassigned - - (8,419) (8,419) (559,515)
Total fund balance 404,619 2,260,723 6,958,696 9,624,038 9,163,451
Total liabilities,deferred inflows
of resources,and fund balance $406,212 $2,342,998 $8,821,100 $11,570,310 $11,306,903
90
CITY OP CHANHASS�N,MINNESOTA
COMBINING STATEMENT OF REVENUES,EXPENDITURES AND Statement 12
CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
Foi•The Yeai•Ended Dece�nber 31,2014
With Compai•ative Totals For The Year Ended December•3l,20]3
Totals
Nonmajor
Special Debt Capital Govein�nental Funds
Revenue Se�vice Project 2014 2013
Revenues:
General properry taxes $ - $1,040,980 $985,000 $2,025,980 $2,038,510
Tax increment collections - - 307,940 307,940 545,906
Licenses and permits - - 427,371 427,371 789,000
Intergovermnental - - 195,7]5 195,715 1,385,423
Special assessments - 11,715 - l 1,715 154,943
Charges for services 190,814 - - 190,814 284,370
Invest�nent earnings 3,760 20,559 68,254 92,573 64,815
Net change in fair value of inveshnents (133) (730) (2,420) (3,283) (76,744)
Contributions and donations 4�4,228 - - 44,228 13,514
Refunds and reimbursements - - 8,591 8,591 152,282
Other - - 73,398 73,398 73,003
Total r•evenues 238,669 1,072,524 2,063,849 3,375,042 5,425,022
Expenditures:
Current:
General government 128,129 2,675 181,356 312,160 324,297
Public safety 34,488 - 82,103 116,591 108,472
Public works - - 533,629 533,629 429,619
Parks and reereation - - 158,761 758,761 43,980
Community development - - 24,180 24,180 108,417
Capital outlay:
General government - - 34,080 34,080 87,707
Public safety - - 23,980 23,980 74,144
Public warks - - 251,300 251,300 1,882,852
Parks and recreation - - 474,775 474,775 418,333
Decertification of TIF district - - 569,760 569,760 -
Debt service:
Principal - 675,000 - 675,000 620,000
Interest and payiug agent fees - 414,397 - 414,397 434,817
Total expenditures 162,617 1,092,072 2,333,924 3,588,613 4,532,638
Revenues over(under)expenditures 76,052 (19,548) (270,075) (213,571) 892,384
Other financing sow•ces(uses):
Sale of capital assets - - 12,984 12,984 -
Transfers in 33,344 108,325 150,000 291,669 627,734
Transfers out - (63,285) (126,725) (190,010) (1,252,942)
Total other financing sources(uses) 33,344 45,040 36,259 714,643 (625,208)
Net change in fund balanee 109,396 25,492 (233,816) (98,928) 267,176
Fund balance-Januaiy 1 295,223 2,235,231 7,192,512 9,722,966 8,896,275
Fund balance-December 31 $404,619 $2,260,723 $6,958,696 $9,624,038 $9,163,45]
Reconciliation of beginning fund balance to pj•ior year ending fund balance:
Prior year•ending fund balance reported above $9,163,451
Reclassification of the 413 Transit Station Assess�nent Fund balance,now pr•esented as a majar fund $559,515
Fund balance-Januaiy 1,2014 as reported on fhis statement $9,722,966
91
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92
NONMAJOR SPECIAL REVENUE FUNDS
Special Revenue Funds ai•e established to account for taxes and other revenues set aside for a
particular purpose. Revenues are recognized in the accounting per•iod in which they become
available and measurable. Expenditures are recognized in the accounting per•iod in which the
related liability is incun•ed.
Contribution Fund — This fund accounts for the proceeds that the City receives from
charitable gambling. The City collects 10% of the net proceeds fi-om a pull-tab operation
in the City. By state statute, the fund may only be used for equipment and training for the
City's fire department.
Cemetery Fund — The City owns and operates a municipal cemetery. In 2014,
improvements were made to add approximately 300 additional plots. This fund accounts
for all plot fees and maintenance going forward. Cemetery operations had p�•eviously been
accounted for within the City's General Fund.
CATV Fund—Under the terms of the franchise agreement with Triax Cablevision, the City
is to receive 5% of the revenues derived fi�om cable television sales within the City. These
monies a�•e dedicated solely to improving public bt•oadcasting capabilities, studio
improvements, and other capital expenditures improving the overall cable system.
93
CITY OF CI3ANHASSEN,MINNESOTA
SUBCOMBINING BALANCE SHEET Statement 13 ',
NONMAJOR SPECIAL REVEN[_lE FUNDS '
December 31,2014 �
With Coinparative Totals Far Decembei•31,2013 ��
II
201 �
Contribution 202 Cemetery 210 CATV Total Nomnajor Special
Fund Fund Fund Revenue Funds
2014 2013
Assets:
Cash and investments $39,853 $27,395 $282,795 $350,043 $248,215
Accrued interest receivable 201 23 1,201 1,425 1,008
Due from other governmental units 735 - - 735 -
Accounts receivable-net 6,607 - 47,402 54,009 54,429
Total assets $47,396 $27,418 $331,398 $406,212 $303,652
Liabilities and Fund Balance
Liabilities:
Accounts payable $ - $ - $ - $ - $5,994
Salaries payable - - 1,593 1,593 2,435
Totalliabilities 0 0 1,593 1,593 8,429
Fund balance:
Restricted 47,396 - 128,693 176,089 165,838
Assigned - 27,418 201,112 228,530 129,385
Total fund balance 47,396 27,418 329,805 404,619 295,223
Total liabilities and fund balance $47,396 $27,418 $331,398 $406,212 $303,652
94
CITY OF CHANHASSEN,MIl�'NESOTA '
SUBCOMBINING STATEMENT OF REVEN[JES, EXPENDITURES Statement 14
AND CHANGES IN FUND BALANCES
NONMAJOR SPECIAL REVENUE FUNDS
For The Year Ended December 31,2014
With Comparative Totals For The Year Ended December 31,2013
201
Contribution 202 Cemeteiy 210 CATV Total Nonmajor Special
Fund Pund Fund Revenue Funds
2014 2013
Revenues:
Franchise and PEG fees $ - $ - $190,814 $190,814 $211,835
Investment earnings 530 62 3,168 3,760 3,131
Net change in fair value of investments (19) (2) (ll2) (133) (2,573)
Contributions and donations 44,228 - - 44,228 13,514
Refunds and reimbursements - - - - 45
Total revenues 44,739 60 193,870 238,669 225,952
Expenditures:
Current:
Personal seivices - - 98,411 98,4ll 94,481
Materials and supplies - - 7,371 7,371 7,571
Contractual seivices 34,488 5,986 16,361 56,835 64,048
Capital outlay:
General government - - - - 9,041
Total expenditures 34,488 5,986 122,143 162,617 175,141
Revenues over expenditures 10,251 (5,926) 71,727 76,052 50,811
Other financing som•ces(uses):
Transfers in - 33,344 - 33,344 -
Transfers out - - - - (774,620)
Total other financing sources(uses) 0 33,344 0 33,344 (774,620)
Net change in fund balance 10,251 27,418 71,727 109,396 (723,809)
Fund balance-January 1 37,145 - 258,078 295,223 1,019,032
Fund balance-December 31 $47,396 $27,418 $329,805 $404,619 $295,223
95
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96 �'
I
1
NONMAJOR DEBT SERVICE FUNDS
Debt Service Funds are maintained on the modified accrual basis of accounting for revenues
fi•om taxes and other soui•ces set aside for the payment of the debt obligations of the City.
Principal and intei•est on the general long-term debt is recognized when due.
General Obli�ation Bonds—These funds are used to account for the accuinulation of'resources
for payment of general obligation bonds or other general indebtedness and the interest thereon.
Tax Increment Bonds — These funds are used to account for•the accumulation of resources for
payment of tax increment gener•al obligation bonds and the interest thereon.
General Improvement Bonds — These funds are used to account for the accumulation of
resources for payment of principal and interest on general obligation improvement bonds.
97
CITY OF CHANHASSEN,MINNESOTA
SUBCOMBINING BALANCE SHEET Statement 15
NONMAJOR DEBT SERVICE FUNDS
December 31,2014
With Comparative Totals Far December 31,2013
367 2008A 369 2010A
300 Permane��t G.O.Public G.O.Library
Revolving Works Facility Refunding Totals Nonmajor Debt
Debt Bonds Bonds Seivice Funds
2014 2013 ,
Assets: ��,
Cash and investments $727,106 $910,000 $609,047 $2,246,153 $2,221,522
Acc3•ued interest receivable 3,311 2,691 1,539 7,541 6,678
Prope�-ty taxes receivable - 4,028 3,001 7,029 7,031
Special assessments receivable 82,275 - - 82,275 59,934
Total assets $812,692 $916,719 $613,587 $2,342,998 $2,295,165
Liabilities,Defeired I�iflows of Resources,and Fund Balance
Liabilities: $ - $ - $ - $ - $ -
Deferred inflows of resources:
Unavailable revenue 82,275 - - 82,275 59,934
Fund balance:
Restricted - 916,719 613,587 1,530,306 1,459,634
Assigned 730,417 - - 730,417 775,597
Total fund balance 730,417 916,719 613,587 2,260,723 2,235,231
Total liabilities,deferred inflows
of j•esources,and fund balance $812,692 $916,719 $613,587 $2,342,998 $2,295,165
98
CITY OF CHANHASSEN,MINNESOTA
SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND Statement l6
CHANGES IN FUND BALANCES
NONMAJOR DEBT SERVICE FUNDS
For The Year Ended December 31,2014 ��
With Comparative Totals For Tl�e Year Ended December 31,2013 �I
362 2004C 367 2008A
300 Taxable G.O. G.O.Public 369 2010A
Permanent T.I. Works G.O.Libra�y
Revolving 360 2004A Refunding Pacility Refunding Totals Nonmajor Debt
Debt G.O.Bonds Bonds Bonds Bonds Service Funds
2014 2013
Revenues:
General property taxes $ - $ - $ - $592,100 $448,880 $1,040,980 �1,038,510
Special assessments 864 10,851 - - - 11,715 23,614
Charges far services - - - - - - 7,610
Invesnnentearnings 8,734 665 - 7,]00 4,060 20,559 15,384
Net change in fair value ofinvesrinents (310) (24) - (252) (144) (730) (]7,043)
Total revenues 9,288 ll,492 0 598,948 452,796 1,072,524 1,068,075
Expenditures:
Current:
General goveinment 2,675 - - - - 2,675 2,585
Debt service:
Principal - - 70,000 275,000 330,000 675,000 620,000
Interest and paying agent fees - - 38,325 284,817 91,255 414,397 434,817
Total expenditures 2,675 0 108,325 559,817 421,255 1,092,072 1,057,402
Revenues over(under)expenditures 6,613 11,492 (108,325) 39,131 31,541 (19,548) 70,673
Otl�er financing sources:
Transferin - - 108,325 - - ]08,325 123,574
Transfer out - (63,285) - - - (63,285) (11,779)
Total otl�er financing sources(uses) - (63,285) 108,325 - - 45,040 111,795
Net cl�ange in fund balance 6,613 (51,793) 0 39,131 31,541 25,492 122,468
Fund balance-January 1 723,804 51,793 - 877,588 582,046 2,235,231 2,112,763
Fund balance-December 31 $730,417 $0 $0 $916,719 $613,587 $2,260,723 $2,235,231
99
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100
NONMAJOR CAPITAL PROJECT FUNDS
Capital Project Funds are used to account for the construction and financing of large capital
pr•ojects. Revenues and expenditures are recognized on the modified accrual basis. Revenues
are recognized in the accounting period in which they become available and measur•able.
Expenditures are recognized in the accounting period in which they are incurred.
Most capital projects are singular in puipose and their revenues/expenditur•es cannot be used
for subsidizing any other operating fund. In each of these cases, bonds or other revenues
received can only be used for these specific activities.
The following Capital Pi�oject Funds differ in that several of the expenditure categoi•ies
repr•esent r•ecuiring types of costs, i.e., peisonal services, repair and maintenance of utilities,
and/or r•ecurring land improvements.
400 Capital Re�lacemei�t Fund—Accounts for monies collected fi•om developers for inspection
and administ��ative seivices for projects.
410 Park Acquisition and Development — Accounts for park dedication fees as requi�•ed by the
City or•dinance. These funds are then utilized to finance park and trail improvements identified
in the park and recreation section of the City's comprehensive plan.
420 Street Pavement Mana�ement—Accounts for•sealcoating costs on local streets.
422 Old Public Works Buildin�— Accounts for the sale of the old public works building and the
related contract for deed t•eceivable.
461 Gateway Place TIF District, 491 TIF #4 Entertainment, 494 TIF #5 North Bav, and 498
TIF #8 Presbyter•ian Homes —Accounts for financing impr•ovements in tax increment financing
districts.
600 Special Assessment Projects — Accounts for the constiuction or projects financed by
special assessments.
603 Lyman Blvd Improvements — Accounts fot• the street and utility improvement of Lyman
Blvd.
605 TH101 Im�rovements — Pioneer to Fl� C� loud — Accounts for the funding sources and
costs of the Trunk Highway 101 improvement project, which includes widening of the highway
between Pioneer Trail and Flying Cloud Drive, sanitary sewer and water extension, storm sewer
improveinents,pedestrian/bicycle trails and a pedesti-ian bridge.
lol
CITY OF CHANHASSEN,MINNESOTA
SUBCOMBINING BALANCE SHEET ,
NONMAJOR CAPITAL PROJECT FUNDS �
December 31,2014
With Comparative Totals For December 31,2013
410 Park
400 Capital Acquisition 420 Street 422 Old Public 461 Gateway
Replacement and Pavement Woi�ks Place TIF
Fund Development Management Building District
Assets:
Cash and investments $1,817,151 $1,738,071 $1,196,007 $260,569 $17,635
Accrued interest receivable 6,835 7,868 2,423 963 44
Due from other govermnental units 295 5 26,188 - -
Accounts receivable-net 39,305 5,800 - - -
Property taxes receivable 5,445 - 1,259 - -
Prepaid items 2,000 - - - -
Contract for deed receivable - - - 1,327,053 -
Special assessments receivable - - 7,786 - -
Total assets $1,871,031 $1,751,744 $1,233,663 $1,588,585 $17,679
Liabilities,Defei�red inflows of Resources,and Fund Balance
Liabilities:
Accounts payable $180,172 $ - $15,066 $ - $6,599
Due to other govermnental units - - - - -
Due to other funds - - - - -
Interfund loan payable - - - - -
Contracts payable - - 104,391 - -
Unearned revenue - - 699,333 - -
Totalliabilities 180,172 0 818,790 0 6,599
Deferred inflows of resources:
Unavailable revenue 3,415 5 7,786 - -
Fund balance:
Nonspendable 2,000 - - 1,287,575 -
Restricted - 1,751,739 - - 11,080
Assigned 1,685,444 - 407,087 301,010 -
Unassigned - - - - -
Total fund balance 1,687,444 1,751,739 407,087 1,588,585 11,080
Total liabilities,deferred inflows
of resow•ces,and fund balance $1,871,031 $1,751,744 $1,233,663 $1,588,585 $17,679
102
Statement 17
603 Lyman 605 TH101
600 Special Blvd Improvements-
491 TIF#4 494 TIF#5 Assessment Improvements Pioneer to Totals Nonmajar Capital P3•oject
Entertainment Noi�th Bay Projects 06-03 Flying Cloud Funds
2014 2013
$734,903 $213,910 $79,711 $1,302,467 $ - $7,360,424 $5,728,008
4,135 749 363 2,492 - 25,872 22,382
- - - - 16,840 43,328 876,741
- - - - - 45,105 54,679
1,796 1,032 - - - 9,532 7,823
- - - - - 2,000 -
- - - - - 1,327,053 1,372,668
- - - - - 7,786 645,785
$740,834 $215,691 $80,074 $1,304,959 $16,840 $8,821,100 $8,708,086
$ - $ - $ - $ - $10,309 $212,146 $180,676
- - - - - - 1,131
- - - - 14,950 14,950 -
- - - - - - 559,515
- - - - - 104,391 160,942
- - - 818,582 - 1,517,915 526,449
0 0 0 818,582 25,259 1,849,402 1,428,713
1,796 - - - - 13,002 646,376
- - - - - 1,289,575 1,327,068
739,038 215,691 - - - 2,717,548 3,062,565
- - 80,074 486,377 - 2,959,992 2,802,879
- - - - (8,419) (8,419) (559,515)
739,038 215,691 80,074 486,377 (8,419) 6,958,696 6,632,997
$740,834 $215,691 $80,074 $1,304,959 $16,840 $8,821,100 $8,708,086
103
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104
CITY OF CHANHASSEN,MINNESOTA li
SUBCOMBINING STATEMENT OF REVENUES,EXPENDITURES AND Statement 18
CHANGES IN FUND BALANCES Page 1 of 2
NONMAJOR CAPiTAL PROJECT FUNDS
For The Year Ended December 31,2014
Wifl�Comparative Totals For The Year Ended December 31,2013
410 Park 420 Street
400 Capital Acquisition and Pavement
Replacement Fund Development Man�gemenY
Revenues:
General property taxes $800,000 $ - $185,000
Tax increment collections - - -
Licenses and permits - 427,371 -
Intergovernmental - - 178,806
Special assessments - - -
Charges for services - - -
Investment earnings 18,030 20,756 6,393
Net change in fair value of investments (639) (736) (227)
Refunds and reimbursements 591 - 8,000
Other 5,800 - -
Total revenues 823,782 447,391 377,972
Expenditures:
Current:
General government 181,356 - -
Public safety 82,103 - -
Public works 24,509 - 483,861
Parks and recreation 127,295 31,466 -
Community development - - -
Capital outlay:
General government 34,080 - -
Public safety 23,980 - -
Public works 249,492 - 1,808
Parks and recr•eation 114,017 360,758 -
Decertification of TIF district - - -
Total expenditm•es 836,832 392,224 485,669
Revenues over(under)expenditures (13,050) 55,167 (107,697)
Other financing sources(uses):
Sale of capital assets 12,984 - -
Transfer in 150,000 - -
Transfer out - (18,400) -
Total other financing sources(uses) 162,984 (18,400) 0
Net change in fund balance 149,934 36,767 (107,697)
Fund balance-January 1 1,537,510 1,714,972 514,784
Fund balance-December 31 $1,687,444 $1,751,739 $407,087
105
CITY OF CHANHASSEN,MINNESOTA I
' SUBCOMBINING STATEMENT OF REVENUES,EXPENDITURES AND �
CHANGES IN FUND BALANCES
NONMAJOR CAPITAL PROJECT FUNDS
For The Year Ended Deceinber 31,2014
With Coinparative Totals Far Tlie Year Ended December 31,2013
422 Old Public 461 Gateway Place 491 TIF#4
Warks Building TIF Dish�ict Entertainment
Revenues:
Genei•al property taxes $ - $ - $ -
Tax increment collections - 20,304 205,470
Licenses and permits - - -
hitergovernmental - - -
Special assessments - - -
Charges for services - - -
Investment earnings 2,541 116 10,911
Net change in fair value of investments (90) (4) (387)
Refunds and reimbursements - - -
Other 67,598 - -
Total revenues 70,049 20,416 215,994
Expenditures:
Current:
General gove�-nment - - -
Public safety - - -
Public works - - -
Parks and recreation - - -
Community development - 14,561 4,937
Capital outlay:
C�eneral goveinment - - -
Public safety - - -
Public works - - -
Parks and recreation - - -
Decertification of TIF district - - -
Total expenditw-es 0 14,561 4,937
Revenues over(under)expenditures 70,049 5,855 211,057
Other financing sources(uses):
Sale of capital assets - - -
Transfer in - - -
Transfer out - - (108,325)
Total other financing som�ces(uses) 0 0 (108,325)
Net change in fund balance 70,049 5,855 102,732
Fund balance-Januajy 1 1,518,536 5,225 636,306
Fund balance-December 31 $1,588,585 $11,080 $739,038
106
Statement 18
Page 2 of 2 ��
605 TH101
498 TIF#8 600 Special 603 Lyman Blvd Improvements-
494 TIF#5 Presbyterian Assessment Improvements Pioneer to Flying Totals Nonmajor Capital Project
North Bay Homes Projects 06-03 Cloud Funds
2014 2013
$ - $ - $ - $ - $ - $985,000 $1,000,000
82,166 - - - - 307,940 545,906
- - - - - 427,371 789,000
- - - 69 16,840 195,715 1,385,423
_ _ - - - - 131,329
_ _ - - - - 64,925
1,975 - 958 6,574 - 68,254 46,300
(70) - (34) (233) - (2,420) (57,128)
- - - - - 8,591 152,237
- - - - - 73,398 73,003
84,071 0 924 6,410 16,840 2,063,849 4,130,995
- - - - - 181,356 167,869
_ - - - - 82,103 96,215
- - - - 25,259 533,629 429,619
_ - - - - 158,761 43,980
2,704 1,978 - - - 24,180 108,417
_ - - - - 34,080 78,666
- - - - - 23,980 74,144
- - - - - 251,300 1,882,852
- - - - - 474,775 418,333
- 569,760 - - - 569,760 -
2,704 571,738 0 0 25,259 2,333,924 3,300,095
81,367 (571,738) 924 6,410 (8,419) (270,075) 830,900
_ - - - - 12,984 -
_ - - - - 150,000 504,160
- - - - - (126,725) (466,543)
0 0 0 0 0 36,259 37,617
81,367 (571,738) 924 6,410 (8,419) (233,816) 868,517
134,324 571,738 79,150 479,967 - 7,192,512 5,764,480
$215,691 $0 $80,074 $486,377 ($8,419) $6,958,696 $6,632,997
Reconciliation of beginning fund balance to prior year ending fund balance:
Prior year ending fund balance reported above $6,632,997
Reclassification of the 413 Tr�ansit Station Assessment Fund balance,now presented as a major fund $559,515
Fund balance-January l,2014 as reported on this statement $7,192,512
107
CITY OF CHANHASSEN,MINNESOTA
SPECIAL REVENLJE FiJND-CONTRIBUTION FLJND Statement 19
SCHEDULE OF REVENi.JES,EXPENDITURES AND '
CHANGES IN FUND BALANCES-BUDGET AND ACTUAL
For The Year Ended December 31,2014
With Comparative Actual Ainounts For The Year Ended Deceinber 31,2013
2014 2013
Budgeted Amounts Actual Variance with Actual
Oi7ginal Final Amounts Final Budget Amounts
Revenues:
Investmentearnings $500 $500 $530 $30 $293
Net change in fair value of investments - - (19) (19) (424)
Contr�ibutions and donations 17,000 17,000 44,228 27,228 13,514
Total revenues 17,500 17,500 44,739 27,239 13,383
Expenditures:
Cui1•ent:
Contractual selvices 30,000 30,000 34,488 (4,488) 12,257
Revenues over(under)expenditw•es ($12,500) ($12,500) 10,251 $22,751 1,126
Fund balance-Januaiy 1 37,145 36,019
Fund balance-December 31 $47,396 $37,145
108
CITY OT CHANHASSEN,MINNESOTA
SPECIAL REVENUE FIJND-CATV Statement 20
SCHEDULE OF REVENUES,EXPENDITURES AND
CHANGES IN FUND BALANCES-BUDGET AND ACTUAL
Far The Year Ended December 31,2014
With Coinparative Actual Amounts For The Year Ended Deceinber 31,2013
2014 2013
Budgeted Amounts Actual Variance with Actual
Original Final Amounts Final Budget Amounts
Revenues:
Franchise and PEG fees $190,000 $190,000 $190,814 $814 $211,835
Investment earnings 2,000 2,000 3,168 1,168 (1,782)
Net change in fan•value of investmeuts - - (112) (112) (2,149)
Other - - - - 45
Total revenues 192,000 192,000 193,870 1,870 207,949
Expenditures:
Cw�rent:
Personal services 97,000 97,000 98,411 (1,411) 94,481
Materials and supplies 25,000 25,000 7,371 17,629 7,571
Conn•actual services 22,300 22,300 16,361 5,939 51,791
Capital outlay - - - - 9,041
Total expenditw•es 144,300 144,300 122,143 22,157 162,884
Revenues over expenditures $47,700 $47,700 71,727 ($20,287) 45,065
Fund balance-Janua�y 1 258,078 213,013
Fund balance-December 31 $329,805 $258,078
109 ;
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110
FIDUCIARY FUNDS
Fiduciaiy Funds have been established to account for cash or other• assets held by the City as a
trustee or agent for others. Revenues are recognized in the accounting period in which they
become available and ineasur•able. Expenditures are recognized in the accounting period in
which the i•elated liability is incun•ed.
Fiduciary Funds are custodial in nature (assets equal liabilities) and do not involve
measurement of the results of operations.
Escrow Fund—This fund is used to account for various deposits required by the City.
Moon Valley Restoration Fund — This is an escrow fund which will be used to finance
r•estoration to a gravel pit when it ceases operation.
111
CITY OF CI3ANHASSEN,MINNESOTA Ii
COMBINING STATEMENT OF NET POSITION Statement 21
AGENCY FUNDS
December 31,2014
With Cotnparative Totals For December 31,2013
913 Moon
Valley
815 Escrow Restoration
Fund Fund Totals
2014 2013
Assets:
Cash and invest�nents $1,219,351 $86,652 $1,306,003 $1,426,193
Liabiliries:
Escrow deposits payable $1,219,351 $86,652 $1,306,003 $1,426,193
112
CITY OF CHANHASSEN,MI1�TN�SOTA
COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES Statement 22
AGENCY FUNDS �
For The Year Ended December 31,2014 ��I
Balance Balance
O1/O1/14 Additions Deletions 12/31/14
Escrow Fund
Assets:
Cash and investments $1,339,715 $690,178 $810,542 $1,219,351
Liabilities:
Escrow deposits payable $1,339,715 $690,178 $810,542 $1,219,351
Moon Valley Resto3•ation Fund
Assets:
Cash and investments $86,478 $174 $ - $86,652
Liabilities:
Escrow depositspayable $86,478 $174 $ - $86,652
Totals-All Agency Funds
Assets:
Casl�and investments $1,426,193 $690,352 $810,542 $1,306,003
Liabilities:
Escrow deposits payable $1,426,193 $690,352 $810,542 $1,306,003
113
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114
III. STATISTICAL SECTION (UNAUDITED)
iis
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116
III. STATISTICAL SECTION (UNAUDITED) I
This part of the City of Chanhassen, Minnesota's Comprehensive Annual Financial Report
presents detailed infonnation as a context for understanding what the information in the financial
statements,note disclosures,and required suppleinentary infonnation says about the Ciry of
Chanhassen, Minnesota's overall financial health.
Contents Pages
Financial Trends
These tables contain hend infonnation to help the reader understand how the 118-126
City's financial pet•formance and well-being have changed over time.
Revenue Capacity
These tables contain infoi7nation to help the reader assess the City's most 128-133
significant local revenue source,the property tax.
Debt Capacity
These tables present information to help the reader assess the affordability of the 134-140
City's cur•rent levels of outstanding debt and the City's ability to issue additional
debt in the future.
Demographic and Economic
These tables offer demographic and econoinic indicatars to help the reader 141-143
undeistand the enviromnent within which the City's financial activities take
place.
Operating Information
These tables contain service and infrastructure data to help the reader understand 144-148
how the information in the City's financial report relates to the seivices the Ciry
provides and the activities it per•fonns.
Sources: Unless otherwise noted,the information in these tables is derived from the
coinprehensive financial reports far the relevant year.
117
CITY OF CHANHASSEN,MINNESOTA
NET POSITION BY COMPONENT
Last Ten Fiscal Years
(Accrual Basis of Accounting)
2005 2006 2007 2008
Governmental activities:
Net inveshnent in capital assets $72,418,684 $70,216,944 $68,982,379 $70,611,368
Restricted:
Debt service 10,174,502 7,687,155 11,047,062 12,165,653
Park improvements - - - -
Tax increment puiposes 1,049,047 1,063,589 797,064 621,915
Other pui•poses - - - -
Um•esn�icted 11,239,658 16,220,834 14,631,166 15,171,391
Total governmental acrivities net position $94,881,891 $95,188,522 $95,457,671 $98,570,327
Business-type activities:
Net investment in capital assets $37,479,967 $47,807,323 $52,502,257 $55,541,752
Um•estricted 23,767,122 15,039,021 17,292,106 13,ll 7,323
Total business-type activities net position $61,247,089 $62,846,344 $69,794,363 $68,659,075
Primary government:
Net investment in capital assets $109,898,651 $118,024,267 $121,484,636 $126,153,120
Restricted:
Debt seivice 10,174,502 7,687,155 11,047,062 12,165,653
Park improvements - - - -
Tax increment pujposes 1,049,047 1,063,589 797,064 621,915
Othei�puiposes - - - -
Unrestricted 35,006,780 31,259,855 31,923,272 28,288,714
Total prima�y govei•nment net posirion $156,128,980 $158,034,866 $165,252,034 $167,229,402
Note: GASB 65 was implemented in 2013. Unamortized bond issuance costs ai�e no longer•included within net posirion.
Net position for years prioi•to 2013 was not 1•estated.
118
Table 1 '�
2009 2010 2011 2012 2013 2014
$72,106,198 $73,272,450 $70,866,708 $69,987,563 $71,260,946 $71,867,072
6,461,780 9,655,951 5,709,727 5,905,553 6,595,927 3,441,810
- 2,088,246 2,516,027 1,650,118 1,714,972 1,751,739
840,857 693,309 812,096 1,022,785 1,347,593 965,809
- 121,137 168,147 142,747 165,838 176,089
14,421,042 8,348,968 12,888,980 14,544,111 13,724,705 13,877,772
$93,829,877 $94,180,061 $92,961,685 $93,252,877 $94,809,981 $92,080,291
$55,496,919 $57,028,340 $55,430,138 $54,475,353 $52,541,451 $54,1ll,608
12,129,049 10,259,836 9,484,947 10,631,342 11,391,338 10,467,201
$67,625,968 $67,288,176 $64,915,085 $65,106,695 $63,932,789 $64,578,809
$127,603,117 $130,300,790 $126,296,846 $124,462,916 $123,802,397 $125,978,680
6,461,780 9,655,951 5,709,727 5,905,553 6,595,927 3,441,810
- 2,088,246 2,516,027 1,650,118 1,714,972 1,751,739
840,857 693,309 812,096 1,022,785 1,347,593 965,809
- 121,137 168,147 142,747 165,838 176,089
26,550,091 18,608,804 22,373,927 25,175,453 25,116,043 24,344,973
$161,455,845 $161,468,237 $157,876,770 $158,359,572 $158,742,770 $156,659,100
119
CITY OF CHANHASSEN,MINNESOTA
CHANGES IN NET POSITION
Last Ten Fiscal Years I
(Accrual Basis of Accounting)
2005 2006 2007 2008
Expenses
Gove�7lmental activities:
General government $4,518,355 $2,380,103 $2,439,716 $2,469,055
Public safety 2,653,304 2,851,926 3,098,068 3,062,941
Public works 4,915,435 7,722,466 7,010,981 6,220,816
Parks and recreation 2,867,364 2,918,645 3,023,032 3,025,987
Community development 595,878 868,749 1,052,104 704,979
Interest on long-teim debt 505,367 751,964 835,059 652,015
Total gover�unental activities expenses 16,055,703 17,493,853 17,458,960 16,135,793
Business-type activities:
Water 2,656,381 2,754,201 3,112,575 3,234,139
Sewer 2,719,156 3,069,069 3,177,366 3,072,588
Sw•face water management 1,039,721 1,317,089 1,238,914 1,121,197
Total business-type activiries expenses 6,415,258 7,140,359 7,528,855 7,427,924
Total primary govei�nment expenses $22,470,961 $24,634,212 $24,987,815 $23,563,717
Program revenues
Gove�nmental activities:
Charges for seivices:
Licenses and permits $2,166,022 $3,612,021 $2,171,558 $1,810,545
Charges for seivices 1,196,103 1,218,816 1,132,448 1,115,903
Fines and forfeits 104,962 162,946 145,682 124,633
Operating grants and contributions 361,093 671,674 452,798 346,023
Capital gr•ants and contributions 5,080,512 2,506,822 7,464,697 3,221,636
Total gove3•nmental activities program revenues 8,908,692 8,172,279 11,367,183 6,618,740
Business-type activities:
Charges far services:
Water 1,703,501 2,111,230 2,461,205 2,408,379
Sewer 1,905,206 2,008,356 2,186,622 2,187,209
Surface water management 299,445 424,702 452,148 479,318
Operating grants and contributions 1,620 539 45,172 36,350
Capital grants and contributions 1,961,122 2,501,598 3,3�40,598 1,527,624
Total business-type activities program revenues 5,870,894 7,046,425 8,485,745 6,638,880
Total primaly gove�nment program revenues $14,779,586 $15,218,704 $19,852,928 $13,257,620
120
Table 2
Page 1 of 2
2009 2010 2011 2012 2013 2014
$2,597,147 $2,898,608 $2,565,486 $2,690,853 $2,630,405 $3,099,004
3,158,465 3,227,396 3,061,122 3,176,441 3,313,694 3,416,088
9,123,165 6,308,023 8,607,534 7,743,147 14,224,453 9,604,525
3,663,124 3,046,718 2,921,593 3,114,340 2,919,183 3,062,592
628,339 879,048 799,379 646,262 523,651 1,043,848
1,031,567 880,384 838,421 725,881 588,352 465,935
20,201,807 17,240,177 18,793,535 18,096,924 24,199,738 20,691,992
3,311,129 3,443,583 3,581,955 3,646,787 4,702,686 3,347,965
3,276,042 3,252,510 3,317,329 3,235,324 3,548,200 3,171,696
1,093,165 1,202,556 1,173,115 1,347,345 1,334,173 1,491,763
7,680,336 7,898,649 8,072,399 8,229,456 9,585,059 8,011,424
$27,882,143 $25,138,826 $26,865,934 $26,326,380 $33,784,797 $28,703,416
$1,085,754 $1,331,374 $1,381,326 $1,595,358 $2,113,770 $1,691,634
1,064,173 1,189,560 1,047,726 1,394,356 1,396,068 1,149,372
122,496 123,609 126,571 119,997 99,984 100,516
363,540 414,654 692,428 404,663 472,298 532,337
1,265,287 4,175,655 1,646,573 2,953,496 10,718,999 3,296,748
3,901,250 7,234,852 4,894,624 6,467,870 14,801,119 6,770,607
2,689,170 2,424,634 2,611,327 3,146,886 2,829,226 2,573,027
2,378,111 2,365,358 2,297,677 2,434,370 2,358,854 2,472,536
512,761 538,688 534,473 590,323 615,896 639,087
5,332 2,984 12,589 121,925 63,112 210,857
1,684,982 1,593,289 1,086,655 1,861,689 2,852,437 2,633,793
7,270,356 6,924,953 6,542,721 8,155,193 8,719,525 8,529,300
$11,171,606 $14,159,805 $11,437,345 $14,623,063 $23,520,644 $15,299,907
121 ',
CITY OF CHANHASSEI�T,MINNESOTA
CHANGES IN NET POSITION
Last Ten Fiscal Years
(Accrual Basis of Accounting)
2005 2006 2007 2008
Net(expense)revenue:
Governmental activities ($7,147,011) ($9,321,574) ($6,091,777) ($9,517,053)
Business-type acrivities (544,364) (93,934) 956,890 (789,044)
Total primary government net(expense)revenue (7,691,375) (9,415,508) (5,134,887) (10,306,097)
General revenues and other changes in net position
Goveinmental activities:
Property taxes 9,451,141 9,165,278 9,419,763 9,651,758
Tax increment collecrions 675,117 315,398 420,526 574,101
Gi•ants and contributions not restricted to specific programs 45,455 28,592 189,616 108,039
Uurestricted investment earnings 387,370 905,930 1,397,746 1,150,993
Miscellaneous 93,792 34,644 - -
Gain on sale of capital assets 23,795 - 10,806 32,195
Special item-sale of public works buildin� - - - -
Transfers (481,824) (821,637) (5,077,531) 1,112,623
Total govermnental activities 10,194,846 9,628,205 6,360,926 12,629,709
Business-type activities:
Unrest�7cted invest3nent eainings 466,750 768,600 786,455 797,079
Miscellaneous 46,100 102,952 127,143 22,464
Transfers 481,824 821,637 5,077,531 (1,112,623)
Total business-type activities 994,674 1,693,189 5,991,129 (293,080)
Tota]priinary government $11,189,520 $11,321,394 $12,352,055 $12,336,629
Change in net position:
Governmental activities $3,047,835 $306,631 $269,149 $3,112,656
Business-type activities 450,310 1,599,255 6,948,019 (1,082,124)
Tota]primary government $3,498,145 $1,905,886 $7,217,168 $2,030,532
Note: GASB 65 was implemented in 2013. Bond issuance costs are now expensed in the year of issuance. Expenses
for years prior to 2013 were not restated.
l22
Table 2
Page 2 of 2
2009 2010 2011 2012 2013 2014
($16,300,557) ($10,005,325) ($13,898,911) ($11,629,054) ($9,398,619) ($13,921,385)
(409,980) (973,696) (1,529,678) (74,263) (865,534) 517,876
(16,710,537) (10,979,021) (15,428,589) (11,703,317) (10,264,153) (13,403,509)
9,921,598 10,014,684 9,849,882 10,064,176 10,059,324 10,482,273
473,674 539,523 566,045 533,011 545,906 307,940
27,612 45,767 28,304 20,071 19,941 19,736
357,953 222,719 505,541 173,523 (14,764) 183,602
4,524 20,727 44,000 56,610 3 7,720 191,755
- - - 1,246,275 - -
774,746 (487,911) 1,061,763 (173,420) 307,596 6,389
11,560,107 10,355,509 12,055,535 11,920,246 10,955,723 11,191,695
141,070 114,349 211,707 92,453 (776) 134,533
10,549 33,644 6,643 - - -
(774,746) 487,9ll (1,061,763) 173,420 (307,596) (6,389)
(623,127) 635,904 (843,413) 265,873 (308,372) 128,144
$10,936,980 $10,991,413 $11,212,122 $12,186,119 $10,647,351 $11,319,839
($4,740,450) $350,184 ($1,843,376) $291,192 $1,557,104 ($2,729,690)
(1,033,107) (337,792) (2,373,091) 191,610 (1,173,906) 646,020
($5,773,557) $12,392 ($4,216,467) $482,802 $383,198 ($2,083,670)
123
CITY OF CHANHASSEN,MINNESOTA
FUND BALANCES-GOVERNMENTAL FUNDS �,
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
2005 2006 2007 2008
General Fund:
Reseived $20,239 $17,376 $13,210 $21,173
Unreserved:
Designated 3,199,800 3,279,050 3,416,950 3,586,750
Undesignated 3,731,023 1,523,844 2,061,126 1,273,796
Nonspendable - - - -
Unassigned - - - -
Totalgeneralfund $6,951,062 $4,820,270 $5,491,286 $4,881,719
All other governmental funds:
Reserved $6,597,316 $5,300,782 $7,335,225 $6,671,271
Unreserved:
Designated:
Special revenue funds 489,370 431,665 548,438 525,692
Capital project funds 4,114,820 13,458,697 9,934,936 18,732,625
U�ldesignated:
Special�•evenue funds - 25,020 - -
Debt service funds 3,403,769 148,784 215,298 237,721
Capital project funds (738,510) (214,183) (239,434) (11,584)
Nonspendable - - - -
Restricted - - - -
Assigned - - - -
Unassigned - - - -
Tota] all other governmei�tal funds $13,866,765 $19,150,765 $17,794,463 $26,155,725
The City ilnplemented GASB Statement No.54 for the fiscal year ended December 31,2011.
Information for yeais prioi•to 2011 is pi•esented in accordance with fund balance classifications in effect at that time.
124
Table 3 �,
2009 2010 2011 2012 2013 2014
$46,750 $55,826 $ - $ - $ - $ -
3,690,000 3,754,000 - - - -
1,137,109 1,459,792 - - - -
- - 17,280 57,137 16,741 58,333
- - 5,278,118 5,434,641 5,274,584 5,550,732
$4,873,859 $5,269,618 $5,295,398 $5,491,778 �5,291,325 $5,609,065
$2,950,284 $5,642,029 $ - $ - $ - $ -
668,992 2,082,929 - - - -
11,418,006 7,487,198 - - - -
342,877 356,724 - - - -
(2,001,i49) (�s6,2o9) - - - -
- - 12,662 1,373,146 1,327,068 1,289,575
- - 10,426,585 6,359,422 9,181,230 5,724,419
- - 6,561,4ll 6,731,400 6,366,292 5,951,507
- - (730,120) (646,856) (559,515) (475,352)
$13,379,010 $14,782,671 $16,270,538 $13,817,112 $16,315,075 $12,490,149
125
CITY OF CHANHASSEN,MINNESOTA
CHANGES IN FUND BALANCES-GOVERNMENTAL FUNDS
Last Ten Fiscal Years
Revenues: 2005 2006 2007 2008
General property taxes $9,417,527 $9,140,601 $9,403,109 $9,582,333 �
Tax increment collections 675,798 $315,398 $420,526 $574,101 ��
Licenses and permits 2,166,022 3,727,297 2,171,558 1,810,545
lntergovernmental 1,244,656 2,171,565 1,148,034 2,147,970
Special assessments 1,113,922 1,922,944 3,922,517 623,893
Chaj•ges for services 863,958 899,015 738,669 841,209
Fines and forfeits 104,962 162,946 145,682 124,633
Investment income 387,370 905,930 1,397,746 1,150,993
Contributions and donations 71,198 43,949 47,428 43,410
Refunds and reimbursements - - - 51,247
Other 430,171 279,549 404,426 238,030
Total revenues 16,475,584 19,569,194 19,799,695 17,188,364
Expenditw�es:
Cu3�•ent:
General goveinment 2,722,171 2,090,565 2,116,928 2,102,512
Public safety 2,547,676 2,656,923 2,924,751 2,885,296
Public works 2,367,652 4,425,237 3,735,950 2,786,397
Pa3•ks and recreation 1,658,200 1,877,109 1,848,880 1,933,353
Community development 372,938 451,092 841,306 468,819
Capital outlay:
General governinent 311,250 98,396 6,734 233,600
Public safety 10,265 38,593 505,215 54,284
Public works 2,334,577 6,431,594 6,693,387 4,677,179
I'arks and recreation 462,794 377,367 1,491,848 642,508
Debt service:
Principal 2,035,000 1,375,000 1,750,000 2,689,552
Interest and paying agent fees 691,230 591,614 769,212 874,848
Bond issuance costs - 36,987 - 93,811
Developer assistance 230,353 111,791 206,753 226,055
Other 897,523 300,000 - -
Total expenditures 16,641,629 20,862,268 22,890,964 19,668,214
Revenues over(under)expenditures (166,045) (1,293,074) (3,091,269) (2,479,850)
Other financing sources(uses):
Bonds issued 2,590,000 6,640,000 - 7,550,000
Loans issued 105,419 708,003 3,014,744 24,839
Bond premium(discount) - (44,610) - -
Redemption of refunding bonds - (3,560,000) - -
Transfers in 338,080 702,889 537,564 2,646,011
Transfers out - - (1,163,065) -
Sale of capital assets 23,795 - 16,740 10,695
Special iYem-sale of old public works building - - - -
Total other financing sources(uses) 3,057,294 4,446,282 2,405,983 10,231,545
Net change in fund balance $2,891,249 $3,153,208 ($685,286) $7,751,695
Debt service as a percentage of
noncapital expenditures 22.0% 14.8% 18.0% 26.4%
Debt service as pej•centage of
total expenditures 16.4°/o 9.6°/o 11.0% 18.6%
126
Table 4
2009 2010 2011 2012 2013 2014
$9,834,389 $10,141,168 $9,760,052 $10,143,011 $10,176,483 $10,489,350
473,674 539,523 566,045 533,011 545,906 307,940
1,085,754 1,331,374 1,381,326 1,595,358 2,113,770 1,691,634 ���
397,438 401,550 1,425,525 2,151,785 7,971,339 2,553,062 �
540,151 790,426 1,242,040 1,667,881 3,193,078 854,966
950,760 923,550 795,616 880,920 907,414 798,578
122,496 123,609 126,571 119,997 99,984 100,516
357,953 222,719 505,541 173,523 (14,764) 183,602
�47,206 58,016 50,685 36,893 33,159 66,918
61,707 132,616 117,441 253,030 235,363 77,871
170,688 213,272 846,523 264,038 259,703 265,119
14,042,216 14,877,823 16,817,365 17,819,447 25,521,435 17,389,556
2,070,698 2,525,326 2,162,479 2,326,490 2,274,640 2,350,437
2,979,044 3,077,038 2,896,644 3,013,980 3,179,446 3,258,363
5,710,804 2,739,704 4,779,067 3,726,158 10,628,140 5,352,221
2,487,985 1,901,564 1,906,489 2,154,714 2,002,604 2,164,703
527,919 698,818 502,916 621,295 522,538 1,034,047
143,663 473,753 129,535 75,226 87,707 34,080
55,152 65,667 52,645 39,314 74,144 23,980
8,179,324 3,995,444 2,122,641 3,502,371 2,482,728 2,894,237
235,292 490,737 309,524 1,310,366 627,214 485,107
2,553,002 2,370,000 1,025,000 5,100,000 1,590,000 4,190,000
920,529 888,843 853,152 814,621 599,487 518,722
73,182 46,505 - - - -
90,354 176,643 298,216 21,108 - -
26,026,948 19,450,042 17,038,308 22,705,643 24,068,648 22,305,897
(ll,984,732) (4,572,219) (220,943) (4,886,196) 1,452,787 (4,916,341)
6,020,000 5,200,000 - - - -
226,991 35,964 - - - -
(8,387,123) - - - - -
1,324,015 1,105,000 1,734,590 1,203,031 888,711 1,783,719
- - - (48,881) (43,988) (676,095)
16,274 30,675 - - - 301,531
- - - 1,475,000 - -
(799,843) 6,371,639 1,734,590 2,629,150 844,723 1,409,155
($12,784,575) $1,799,420 $1,513,647 ($2,257,046) $2,297,510 ($3,507,186)
20.5% 23.2% 13.3% 33.3% 10.5% 25.0°/a
13.6% 17.0% 11.0% 26.0% 9.1% 21.1%
127
CITY OF CHANHASSEN,MINNESOTA
TAX CAPACITY VALUE AND ESTIMATED MARKET VALUE OF TAXABLE PROPERTY
Last Ten Fiscal Years
Fiscal
Year CommerciaU Total
Ended Residential Industrial All Tax
December 31, Property Agricultui•al Property Other Capacity
2005 $22,438,051 $178,598 $6,054,042 $388,885 $29,059,576 ,
2006 24,904,864 229,651 6,537,205 408,070 32,079,790
2007 27,853,083 316,461 8,ll4,703 428,203 36,712,450
2008 29,821,326 208,789 9,135,911 435,603 39,601,629
2009 30,741,292 190,844 9,665,269 471,749 41,069,154
2010 30,301,115 170,857 10,229,329 477,663 41,178,964
2011 28,951,885 131,751 9,778,491 511,185 39,373,312
2012 27,198,238 137,012 9,149,904 520,743 37,005,897
2013 26,970,557 105,160 8,927,095 541,612 36,544,424
2014 28,725,937 132,728 8,984,174 613,105 38,455,944
Sources Ca�ver County Taxpayer Services and Hennepin County
128
Table 5
Captured Tax
Capacity on Fiscal Adjusted City Estimated Tax Capacity
Tax Increment Disparity Tax Capacity Direct Tax Market as a Percent
District Contribution Value Rate Value of EMV
($619,902) $60,354 $28,500,028 28.11800 $2,552,120,200 1.12%
(309,211) (929,994) 30,840,585 26.63800 2,812,847,100 1.10°/a
(418,018) (955,204) 35,339,228 23.78800 3,175,746,500 1.11%
(479,494) (1,498,894) 37,623,241 23.71300 3,394,928,100 1.11%
(473,702) (1,627,749) 38,967,703 22.99300 3,501,886,800 1.11°/a
(532,007) (1,861,362) 38,785,595 25.18300 3,491,841,800 1.11°/a
(509,863) (1,998,912) 36,864,537 26.60256 3,350,141,800 1.10%
(469,759) (2,038,437) 34,497,701 28.53211 3,153,275,000 1.09°/a
(435,999) (1,804,630) 34,303,795 28.42838 3,118,066,700 1.10%
(252,884) (1,971,928) 36,231,132 27.23862 3,294,605,000 1.10%
129
CITY OF CHANHASSEN,MINNESOTA
DIRECT AND OVERLAPPING PROPERTY TAX CAPACITY RATES Table 6
Last Ten Fiscal Years
City Overlapping Rates
Fiscal Direct School Carver
Year Rate��� District#112 County Other Total
Tax capacity rates(pej•$100 of adjusted tax capacity value)
2005 28.11800 33.29900 44.10700 5.56000 111.08400
2006 26.63800 32.80800 40.83600 5.30500 105.58700
2007 23.78800 35.83100 37.80200 5.13200 102.55300
2008 23.71300 35.97000 37.56300 5.54700 102.79300
2009 22.99300 35.50500 38.03300 5.45800 101.98900 '
2010 25.18300 35.84000 39.50900 5.63900 106.17100 ��I
2011 26.60256 40.23554 41.75163 6.02059 114.61032 �i�
2012 28.53211 44.38247 43.56239 6.68081 123.15778 ��
2013 28.42838 45.31946 46.11540 6.60329 126.46653
2014 27.23862 44.91727 45.21055 6.87257 124.23901
Sow�ce: Carver County Taxpayer Services
���The City Direct Rate is the Urban based rate,not including Market Value levies.
130
CITY OF CHANHASSEN,MINNESOTA I
PRINCIPAL PROPERTY TAXPAYERS Table 7 I
Cuirent Year and Nine Years Ago I
2014 2005
Percentage Percentage
Taxable of Total City Taxable of Total City
Capacity Capacity Capacity Capacity
Taxpayer Value Rank Value Value Rank Value
Istar Minnesota LLC $388,016 1 1.1°/o $261,428 2 1.0%
IRET Properties 369,504 2 1.0% 257,924 3 0.9%
Rosemount Inc 312,586 3 0.8% 276,802 1 1.0%
Northein States Power Co 265,464 4 0.7% 213,342 4 0.8%
LTF Real Estate VRDN I LLC 239,202 5 0.6% - - -
LTF Real Estate CBC I(Chan Club)LLC 204,916 6 0.6% - - -
PHM/Chanhassen Inc 202,266 7 0.5°/o - - -
DRF Chanhassen Medical Bldg 194,888 8 0.5°/o - - -
Target Co�poration T-0862 194,422 9 0.5% 145,472 7 0.5%
Cente3point Energy Minnegasco 176,442 10 0.5°/o - - 0.0%
McGlynn Bakeries Inc#366 - - 207,488 5 0.8%
Park Avenue Lofts LLC - 0.0°/o 147,928 6 0.5%
Emplast I�ic - - 134,610 8 0.5%
Bloomberg Companies Inc - - 128,916 9 0.5%
Market Square Assoc Ltd Parmership - - 125,308 10 0.5%
Total $2,547,706 6.9% $1,899,218 6.9%
Total All Property $36,823,088 $27,217,125
Source: Carver County Taxpayer Services
131
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132
CITY OF CHANHASSEN,MINNESOTA
PROPERTY TAX LEVIES AND COLLECTIONS Table 8
Last Ten Fiscal Years
Fiscal Taxes Collected Within The Collections
Year Levied Fiscal Year of the Levy in Total Collections to Date
Ended For The Percentage Subsequent Percentage
December 31, Fiscal Year Amount of Levy Years Amount of Levy
2005 $9,439,754 $9,124,030 96.7% $120,936 $9,244,966 97.9%
2006 9,354,890 9,066,591 96.9% 90,332 9,156,923 97.9%
2007 9,575,778 9,447,692 98.7% 114,938 9,562,630 99.9%
2008 9,834,965 9,555,489 97.2% 144,829 9,700,317 98.6%
2009 10,074,565 9,668,713 96.0% 155,562 9,824,275 97.5%
2010 10,213,190 9,918,528 97.1% (22,702) 9,895,826 96.9%
2011 10,267,390 9,739,125 94.9% 180,704 9,919,829 96.6°/a
2012 10,153,690 10,005,877 98.5% 46,492 10,052,370 99.0%
2013 10,195,890 10,105,393 99.1% 22,405 10,127,798 99.3°/a
2014 10,334,140 10,269,518 99.4% - 10,269,518 99.4%
Source: City Finance Department
133
CITY OF CHANHASSEN,MINNESOTA '
RATIOS OF OUTSTANDING DEBT BY TYPE
Last Ten Fiscal Years
Gove�nmental Activiries
Genei�al General
Fiscal Obligation Revenue Tax Increment Improvement
Year Bonds Bonds Bonds Bonds
2005 $12,215,000 $705,000 $1,170,000 $3,325,000
2006 8,170,000 620,000 1,120,000 9,210,000
2007 7,315,000 530,000 1,070,000 8,45 5,000
2008 13,905,000 435,000 1,015,000 7,155,000
2009 13,045,000 335,000 960,000 6,625,000
2010 16,860,000 230,000 900,000 5,805,000
2011 16,195,000 120,000 840,000 5,615,000
2012 11,475,000 - 775,000 5,420,000
2013 10,155,000 - 705,000 5,220,000
2014 9,550,000 - 635,000 1,705,000
Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements.
���Infoi7nation pertaining to Chanhassen Personal Income is not available,information for Caiver County was
included instead.
(a)Information not available
134
Table 9
Business-Type Bonded Debt �I
Activities Per Total ��
Caiver County
Other G.O.Revenue Debt Personal
Debt Bonds Total Debt Per Capita Income���
$105,419 $15,545,000 $33,065,419 $1,386 0.9°/a
813,422 14,820,000 34,753,422 1,455 0.8°/a
3,828,166 13,915,000 35,113,166 1,444 0.8°/a
3,375,125 12,415,000 38,300,125 1,564 0.8°/a
- 11,695,000 32,660,000 1,322 0.7%
- 10,955,000 34,750,000 1,514 0.7%
- 20,077,339 42,847,339 1,849 0.8°/a
- 20,578,313 38,248,313 1,629 0.7%
- 16,324,287 32,404,287 1,353 0.5%
- 10,045,261 21,935,261 899 (a)
l35
CITY OF CHANHASSEN,iYI1NNESOTA
RATIOS OF GENERAL BONDED DEBT OUTSTANDING Table l0
Last Ten Fiscal Years
Net General I
General G.O.Tax G.O. G.O. Total General Less Amounts Net General Percentage Obligation
Fiscal Obligation Increment Improvemcnt Revenue Obligation Restricted for OUligation of Tax Bonded Debt I
Year Bonds Bonds Bonds Bonds Bonded Debt Debt Se�vice Bonded Debt Capaciry Per Capita �
2005 $12,215,000 �1,170,000 $3,325,000 $15,545,000 $32,255,000 $10,174,502 $22,080,498 79.16% $925
2006 8,170,000 1,120,000 9,210,000 14,820,000 33,320,000 7,687,]55 25,632,845 84.13°/a 1,073
2007 7,3]5,000 1,070,000 8,455,000 13,915,000 30,755,000 11,047,062 19,707,938 56.65% 810
2008 13,905,000 1,015,000 7,155,000 12,415,000 34,490,000 12,165,653 22,324,347 59.56% 972
2009 13,045,000 960,000 6,625,000 1],695,000 32,325,000 6,461,780 25,863,220 66.29°/a 1,047
2010 16,860,000 900,000 5,805,000 10,955,000 34,520,000 9,217,254 25,302,746 64.55% 1,102
2011 16,195,000 840,000 5,615,000 20,077,339 42,727,339 ]6,998,401 25,728,938 68.61% 1,110
2012 17,475,000 775,000 5,420,000 20,578,313 38,248,313 13,020,206 25,228,707 71.80% 1,074
2013 10,155,000 705,000 5,220,000 16,324,287 32,404,287 ]0,266,366 22,137,92] 63.62°/a 924
2014 9,550,000 635,000 1,705,000 10,045,261 21,935,261 3,441,810 18,493,451 50.09°/a 758
Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements.
136
CITY OF CHANHASSEN,MINNESOTA
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT Table 11
December 31,2014 ��
Estimated
Estimated Sl�are of
Debt Percentage Ovet�lapping
Governmental Unit Outstanding Applicable'�` Debt
Direct debt:
City of Chanhassen�'� $11,890,000 100.00% $11,890,000
Ovej•lapping debt:
Eastern Caiver County School District 226,215,000 41.15% 93,087,473
Eden Prairie Independent School District 52,979,520 1.05% 556,285
Minnetonka Independent School District 95,419,347 0.00% -
Carver County 27,620,000 33.73% 9,316,226
Hennepin County 753,266,880 0.07°/a 527,287
Hennepin Subui•ban Park District 52,209,049 0.09°/o 46,988
Hennepin Regulatory Railroad Authority 35,200,157 0.09% 31,680
Metropolitan Council 93,953,739 0.04% 37,581
Subtotal-overlapping debt 1,336,863,692 103,603,520
Total direct and overlapping debt $1,348,753,692 $115,493,520
���Excludes debt related to the City's business-type activities.
Note: Overlapping governments are those that coincide,at least in pait,with tl�e geographic boundaries of'the City.This
schedule estimates the poi�tion of the outstanding debt of those overlapping governments that is borne by the residents
and businesses of tl�e City.This process recoguizes that,when considering the City's ability to issue and repay long-te3m
debt,the entire debt burden barne by the residents and businesses should be taken into account. However,this does uot
imply that every taxpayer is a resident,and therefore responsible for repaying the debt,of each ove�•lapping government.
*For debt repaid witl�property taxes,tl�e percentage of overlapping debt applicable is esri3nated using taxable assessed
prope�ty values. Applicable percentages were estimated by determining the portion of another gover•nmental unit's taxable
assessed value that is within the City's boundai•ies and dividing it by each unit's total taxable assessed value.
137
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138
CITY OF CHANHASSEN,MINNESOTA
LEGAL DEBT MARGIN INFORMATION Table 12
Last Ten Fiscal Years
Legal Debt Margin Calculation for Fiscal Year 2014
Market value $3,294,605,000
Applicable percentage 3%
Debt limit 98,838,150
Debt applicable to limit:
Total bonded debt 21,935,261
Less:
Special assess�nent bonds (1,705,000)
Tax increment bonds (635,000)
Enteiprise Fund debt (10,045,261)
Less:
Cash and invesrinents in G.O.Bond Debt Seivice Fund (1,519,047)
8,030,953
Legal debt margin $90,807,197
Legal Debt Margin Calculation for Fiscal Years 2005 Through 2014
Net Debt
Net Debt Legal Amount of Debt Applicable
Fiscal Debt Applicable to Debt Applicable to to Limit
Yea�• Popularion Limit Limit Margin Debt Limit Per Capita
2005 23,864 $51,042,404 $8,150,626 $42,891,778 15.97% $342
2006 23,889 56,256,942 6,950,304 49,306,638 12.35% 291
2007 24,321 63,514,930 5,844,648 57,670,282 9.20% 240
2008 24,481 101,847,843 11,924,438 89,923,405 11.71% 487
2009 24,699 105,056,604 11,175,086 93,881,518 10.64% 452
2010 22,952 104,755,254 15,831,831 88,923,423 15.11% 690
2011 23,179 100,504,254 14,755,258 85,748,996 14.68% 637
2012 23,484 94,598,250 10,117,347 84,480,903 10.70% 431
2013 23,954 93,542,001 8,705,958 84,836,043 9.31% 363
2014 24,388 98,838,150 8,030,953 90,807,197 8.13% 329
139
CITI'OF CHANHASSEN,MINNESOTA
PLEDGED REVENiTE COVERAGE Table 13
Last Ten Fiscal Yeais
Ilnprovement Bonds
Special
Fiscal Assessment Debt Service
Year Collections Principal Interest Coverage
2005 $1,113,922 $870,000 $139,059 1104
2006 1,922,944 755,000 103,813 2.239
2007 3,922,517 755,000 360,852 3.515
2008 623,891 1,300,000 287,727 0.393
2009 540,148 1,220,000 142,963 0.396
2010 790,422 1,050,000 23 0,084 0.617
2011 1,242,038 330,000 185,733 2.408
2012 1,527,253 595,000 178,115 1.975
2013 3,193,076 970,000 164,220 2.815
2014 854,966 3,515,000 103,875 0.236
Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements.
l40
CITY OF CHAl\'HASSEN,MINNESOTA
DEMOGRAPHIC AND ECONOMIC STATISTICS Table 14
Last Ten Fiscal Years
Carver County Ca�ver Counry
Chanhassen Caivei•County Personal Per Capita
Fiscal Chanhassen Unemployment Unemployment Income Personal
Year Population��� Rate«� Rate��� (Tl�ousands)�3� Income�3�
2005 23,864 2.6% 3.4% $3,829,211 $45,992
2006 23,889 2.7% 3.3% 4,120,120 48,100
2007 24,321 2.9% 4.0% 4,569,444 52,360
2008 24,481 3.6°/a 4.9°/a 4,831,653 54,403
2009 24,699 5.8% 7.0°/a 4,641,842 51,438
2010 22,952 6.1% 6.8% 4,939,629 54,079
2011 23,179 4.9% 5.6% 5,439,073 58,589
2012 23,484 4.5% 4.8% 5,826,217 62,068
2013 23,954 4.1% 4.3% 5,930,653 62,061
2014 24,388 3.3% 3.6% (a) (a)
Sources: ���Federal Census Data and Chanhassen Planning Department
�Z�State of Minnesota,Department of Employment and Economic Development
�3�U.S.Department of Commerce,Bureau of Economic Analysis
(a)Information not available
Note: Infoimation pertaining to Chanllassen Personal Income and Per Capita Personal Income is not available,information
for Carver County was included instead.
141
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142
CITY OF CHANHASSEN,MINNESOTA
PRINCIPAL EMPLOYERS Table 15
Current Year and Eight Years Ago���
2014 2006
Percentage Percentage
of Total City of Total City
Employer Employees Rank Einployment«� Employees Rank Employinent«�
Rosemount Inc 1,376 1 24.5% 1,200 1 24.4%
Lifetime Fitness 1,166 2 20.8% - -
Instant Web Companies 1,120 3 19.9% 548 4 11.1%
Eastern Caiver County Schools 410 4 7.3% - -
RR Donnelley 382 5 6.8% 324 6 6.6%
General Mills 300 6 5.3°/o 600 3 12.2%
Minnesota Landscape Arboretum 240 7 4.3% 240 9 4.9%
Chanhassen Dinner Theatres 237 8 4.2% 300 7 6.1%
Exlar Coiporation 210 9 3.7% - -
Target 175 10 3.1% - -
Super Value Headquarters - - 900 2 18.3%
Entegris - - 350 5 7.1%
Byerly's - - 280 8 5.7%
ABC/Lyman Lumber - - 175 10 3.6%
Total 5,616 4,917
Sow•ce: Survey by City Administration and Finance Departments
�i�Principal e�nployer info3�mation prior to 2006 is not available
�2�The statistic for total City employment is not available,therefore the percentage represents the percentage of
the top ten listed.
143
CITY OF CHANHASSEN,MINNESOTA ',
FULL-TIME EQUNALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION/PROGRAM �
Last Ten Fiscal Years I
Full-Time Equivalent Employees as of Decembei•31,
Function/Program 2005 2006 2007
General government 12 12 13
Public safety 3 3 3
Public works 25 26 26
Parks&recreation 11 11 11
Community development 17 17 16
Total 68 69 69
Source: City Finance Departinent
144
Table 16
Full-Time Equivalent Employees as of December 31,
2008 2009 2010 2011 2012 2013 2014
13 13 13 13 13 13 13
3 3 3 3 3 3 3
26 26 26 26 26 26 26
11 11 11 11 11 11 11
16 16 15 15 14 14 14
69 69 68 68 67 67 67
l45
CITY OF CHANHASSEN,MINNESOTA
OPERATING INDICATORS BY FUNCTION/PROGRAM '
Last Ten Piscal Years i
Fiscal Year
Fuilction/Program 2005 2006 2007
Building:
Total permits issued 2,884 3,165 3,013
Total estimated value $71,357,132 $106,223,825 $125,865,426
Election:
Registered voters 15,632 15,319 15,319
Fire:
Average nwnber of employees 43 44 44
General government:
Area of city-square miles 23.78 23.78 23.78
Average nwnber of permanent full-time
employees(excluding�ire department) 68 69 69
Police:
Average number of employees 13 13 13
Number of major crimes 1,068 1,297 1,202
Water:
Number of customers 6,872 6,752 6,804
Daily average consumption-gallons 2,571,843 3,163,864 3,031,400
Plant capacity-gallons 8,650,000 8,650,000 8,650,000
Source: Various City Departments
146
Table 17
Fiscal Year
2008 2009 2010 2011 2012 2013 2014
2,838 2,608 2,910 3,397 3,285 3,201 3,076
$124,885,965 $67,811,817 $65,046,933 $82,991,029 $83,531,808 $89,370,069 $80,591,941
16,544 16,544 15,326 15,326 16,916 16,916 16,344
45 45 45 47 48 48 48
23.78 23.78 23.78 23.78 23.78 23.78 23.79
69 69 68 68 67 67 67
14 15 15 15 15 15 15
1,013 702 647 757 777 748 838
7,039 7,427 7,620 7,655 7,741 7,953 8,075
3,200,000 3,642,410 2,698,559 2,257,542 2,570,349 2,876,383 2,524,413
8,650,000 8,650,000 8,650,000 8,650,000 8,650,000 8,650,000 8,650,000
147
CITY OF CHANHASSEN,MINNESOTA
CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM
Last Ten Fiscal Years
Fiscal Year
Function/Program 2005 2006 2007
Fire:
Nwnber of stations 2 2 2
Parks and recreation:
Acres of parks 375 375 383
Acres of open space 365 365 434
Number of shelter buildings 3 3 3
Number of picnic sl�elters 4 4 5
Number of playgrounds 25 25 26
Number of swimming beaches 4 4 6
Number of tennis courts 17 17 17
Number of outdoor pickleball cow-ts - - -
Police:
Number of stations 1 1 1
Public works:
Miles of streets 102.5 103.8 106.2
Miles of sidewalks 24.7 25.5 26.9
Miles of trails 42.0 43.0 47.2
Sewer:
Miles of storm sewers 62.7 64.2 66.2
Miles of sanitary sewers 115.4 116.9 119.6
Number of lift stations 30 31 31
W ater:
Miles of watermains 120.8 123.4 126.0
Number of wells 8 10 11
148
Table 18
Fiscal Year
2008 2009 2010 2011 2012 2013 2014
2 2 2 2 2 2 2
383 383 396 396 401 401 405
434 434 434 489 503 503 503
3 4 4 4 4 4 4
5 5 5 5 5 6 7
26 26 26 26 26 27 28
6 6 5 5 5 5 5
17 17 17 17 15 15 15
_ _ _ - 2 3 6
1 1 1 1 1 1 1
107.0 110.9 1119 ll2.0 112.6 113.5 113.7
28.4 31.1 31.9 31.9 31.9 31.9 32.0
53.0 53.6 53.6 56.1 56.4 58.6 59.2
67.1 69.5 71.0 74.5 75.3 76.5 77.0
120.8 123.0 123.6 123.7 123.9 124.3 124.5
31 31 31 31 31 31 31
129.6 135.1 136.8 137.8 138.0 139.1 139.3
12 12 12 12 12 12 12
149
I
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150
IV. OTHER INFORMATION (UNAUDITED)
isi
CITY OF CHANHASSEN,MINNESOTA
COMBINED SCHEDULE OF INDEBTEDNESS
Deceinber 31,2014
Final
Interest Issue Maturity
Bonded indebtedness: Rates Date Date
General obligation bonds:
G.O.Capital Improvement Plan Bonds,Series 2008A 4.00%-4.60% 11/18/08 02/O1/30
G.O.Library Refunding Bonds, Series 2010A 2.00%-3.10% O1/27/10 02/O1/22
Total general obligatioil bonds
Tax increment bonds:
G.O.Tax Increment Refunding Bonds,Series 2004C 3.00%-6.00% 08/10/04 02/O1/21
General improvement bonds:
G.O.Improvement Bonds,Series 2009A 3.00% 06/03/09 OZ/O1/17
Enterprise Fund debt:
G.O.Water Revenue Bonds,Series 2004B 4.00%-4.50% 08/10/04 02/O1/25
G.O.Water Revenue Bonds,Series 2011A 0.30%-2.15% 10/06/11 02/O1/22
G.O.Water Revenue Refunding Bonds, Series 2011B 2.00%-3.00°/o 10/06/11 02/O1/25
G.O.Water and Sewer Revenue Bonds, Series 2012A 1.00%-1.55% 1 U15/12 02/O1/23
Total Enterprise Fund debt
Total City bonded indebtedness
152
Exhibit 1
Prior Yeais Payable 2014 Payable Principal
Original January 1, December 31, Due in
Issue Payments 2014 Issued Payments 2014 2015
$7,550,000 $770,000 $6,780,000 $ - $275,000 $6,505,000 $285,000
3,660,000 285,000 3,375,000 - 330,000 3,045,000 340,000
11,210,000 1,055,000 10,155,000 0 605,000 9,550,000 625,000
1,170,000 465,000 705,000 - 70,000 635,000 75,000
6,020,000 800,000 5,220,000 - 3,515,000 1,705,000 550,000
7,930,000 2,425,000 5,505,000 - 5,505,000 - -
5,920,000 220,000 5,700,000 - 645,000 5,055,000 655,000
3,720,000 - 3,720,000 - - 3,720,000 -
1,245,000 - 1,245,000 - 115,000 1,130,000 120,000
18,815,000 2,645,000 16,170,000 0 6,265,000 9,905,000 775,000
$37,215,000 $4,965,000 $32,250,000 $ - $10,455,000 $21,795,000 $2,025,000
153 I
CITY OF CHANHASSEN,MINNESOTA
DEBT SERVICE PAYMENTS TO MA'I'LJRITY Exhibit 2
GENERAL OBLIGATION BONDS-GOVERNMENTAL ACTNITIES ,
December 31,2014 '
G.O.Tax
G.O.Capital G.O.Library Incr•ement G.O.
Improvement Refunding Refunding Improve�nent
Plan Bonds, Bonds Bonds, Bonds,
Series 2008A Series 2010A Series 2004C Series 2009A Total
Bonds payable $6,505,000 $3,045,000 $635,000 $1,705,000 $11,890,000
Future interest payable 2,562,053 381,188 138,128 77,925 3,159,294
$9,067,053 $3,426,188 $773,128 $1,782,925 $15,049,294
Payments to maturity:
2015 $558,168 $423,680 $109,005 $592,900 $1,683,753
2016 556,568 420,543 109,895 591,175 1,678,181
2017 559,468 425,830 110,440 598,850 1,694,588
2018 561,768 424,880 110,580 - 1,097,228
2019 558,484 433,480 110,308 - 1,102,272
2020 564,423 431,630 109,600 - 1,105,653
2021 564,468 429,480 113,300 - 1,107,248
2022 563,705 436,665 - - 1,000,370
2023 567,014 - - - 567,014
2024 569,270 - - - 569,270
2025 570,454 - - - 570,454
2026 570,545 - - - 570,545
2027 574,413 - - - 574,413
2028 572,035 - - - 572,035
2029 578,275 - - - 578,275
2030 577,995 - - - 577,995
$9,067,053 $3,426,188 $773,128 $1,782,925 $15,049,294
154
CITY OF CHANHASSEN,MINNESOTA
DEBT SERVICE PAYMENTS TO MA"I'iJRITY Exhibit 3
GENERAL OBLIGATION REVENUE BONDS
December 31,2014
G.O.Water G.O.Water G.O.Water&
Revenue Revenue Sewer Revenue
Bonds, Series Bonds, Series Bonds, Series
2011 A 20ll B 2012A Total
Bonds payable $5,055,000 $3,720,000 $1,130,000 $9,905,000
Future intej•est payable 318,837 815,100 65,728 1,199,665
$5,373,837 $4,535,100 $1,195,728 $11,104,665
Payments to maturity:
2015 $722,923 $106,000 $132,540 $961,463
2016 718,501 135,700 131,340 985,541
2017 722,060 135,100 130,140 987,300
2018 728,813 134,500 133,915 997,228
2019 733,663 569,500 132,665 1,435,828
2020 731,758 567,600 131,321 1,430,679
2021 738,163 572,900 134,758 1,445,821
2022 277,956 572,675 133,003 983,634
2023 - 576,925 136,046 712,971
2024 - 580,575 - 580,575
2025 - 583,625 - 583,625
$5,373,837 $4,535,100 $1,195,728 $11,104,665
155 III
CITY OF CHANHASSEN,MINIVESOTA
SCHEDULE OF DEFERRED TAX LEVIES Exhibit 4
December 31,2014
G.O.
Library G.O.Capital Total Improvement G.O. Street Total Total
Years of Bonds Improvement General Refunding Reconstruction General Deferred
Levy/ of 2002A/ Plan Bonds Bonded Bonds Bonds Improvement Tax
Collection 2010A of 2008A Debt of 2009A of 2010 Bonds Levies
2014/2015 $446,098 $590,600 $1,036,698 $232,300 $55,000 $287,300 $1,323,998
2015/2016 452,792 594,000 1,046,792 240,700 - 240,700 1,287,492
2016/2017 451,952 596,700 1,048,652 - - - 1,048,652
2017/2018 461,297 593,600 1,054,897 - - - 1,054,897
2018/2019 459,512 600,300 1,059,812 - - - 1,059,812
2019/2020 457,412 600,800 1,058,212 - - - 1,058,212
2020/2021 465,497 600,400 1,065,897 - - - 1,065,897
2021/2022 - 604,500 604,500 - - - 604,500
2022/2023 - 607,400 607,400 - - - 607,400 '
2023/2024 - 609,200 609,200 - - - 609,200 �
2024/2025 - 609,900 609,900 - - - 609,900 �,
2025/2026 - 614,600 614,600 - - - 614,600 �,
2026/2027 - 612,700 612,700 - - - 612,700 �
2027/2028 - 620,100 620,100 - - - 620,100
2028/2029 - 620,600 620,600 - - - 620,600 I
$3,194,560 $9,075,400 $12,269,960 $473,000 $55,000 $528,000 $12,797,960
156
�� , �_�_� � � � �:,-•�:
A N D C O M P P. N \- '�
MINNESOTA LEGAL COMPLIANCE
To the Honorable Mayor and
Members of the City Council
City of Chanhassen, Minnesota
We have audited, in accordance with auditing standards generally accepted in the United States
of America, and the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller•General of the United States, the financial statements of the
goveinmental activities, the business-type activities, each major fund, and the aggregate
remaining fund information of the City of Chanhassen, Minnesota as of and for the year ended
December•31, 2014, and the related notes to the financial statements, and have issued our report
thereon dated May 19, 2015.
The Minnesota Legal Compliance Audit Guide for Political Subdivisions,promulgated by the
State Auditor pursuant to Minn. Stat. § 6.65, contains seven categories of compliance to be
tested: contracting and bidding, deposits and investments, conflicts of interest,public
indebtedness, claims and disbui•sements, miscellaneous pr•ovisions and tax increment financing.
Our audit consider•ed a11 of the listed categories.
In connection with our audit, nothing came to our attention that caused us to believe that the City
of Chanhassen, Minnesota failed to comply with the provisions of the Minnesota Legal
Compliance Audit Guide for Political Subdivisions. However, our•audit was not du•ected
pr•imar•ily toward obtaining knowledge of such noncompliance. Accordingly, had we performed
additional procedures, other matteis may have come to our attention regarding the City of
Chanhassen, Minnesota's noncoinpliance with the above referenced pi•ovisions.
The purpose of this r•eport is solely to describe the scope of our testing of compliance and the
results of that testing, and not to pr•ovide an opinion on compliance. Accordingly, this
communication is not suitable for any other purpose.
�'�� �� �� �
G�� �
REDPATH AND COMPANY, LTD.
St. Paul, Minnesota
May 19, 2015
4810 White Bear Parkway, St. Paul, MN, 55110 651.426.7000 www.redpathcpas.com
�
A N C5 C O M P A fJ Y
COMMUNICATION WITH THOSE CHARGED WITH GOVERNANCE I
To the Honorable Mayor and
Members of the City Council
City of Chanhassen, Minnesota
We have audited the financial statements of the governmental activities, the business-
type activities, each major fund and the aggregate remaining fund information of the City of
Chanhassen, Minnesota for the year ended December 31, 2014. Pr•ofessional standar•ds
require that we pt•ovide you with infoimation about our•responsibilities under generally
accepted auditing standards, Goveryament Auditing Standards and OMB Circular A-133, as
well as certain information i•elated to the planned scope and timing of our audit. We have
communicated such information in our letter to you dated March 23, 2015. Professional
standards also require that we communicate to you the following information r•elated to our•
audit.
Si�nificant Audit Results
Qualitative Aspects of Accounting Practices
Management is responsible for the selection and use of appropriate accounting policies.
The significant accounting policies used by the City a�•e described in Note 1 to the financial
statements. No new accounting policies were adopted and the application of eXisting policies
was not changed during 2014. We noted no t�•ansactions entered into by the City during the
year for which there is a lack of authoritative guidance or consensus. All significant
tr•ansactions have been recognized in the financial statements in the proper per•iod.
Accounting estimates are an integral part of the financial statements prepared by
management and are based on management's knowledge and exper-ience about past and
cui�rent events and assumptions about future events. Certain accounting estimates are
particularly sensitive because of their significance to the financial statements and because of
the possibility that future events affecting them may differ significantly from those expected.
The most sensitive estimate affecting the financial statements was management's estimate of
the portion of constiuction projects which will be capitalized. This estimate is based on
feasibility reports and estimates of the City Engineer. We evaluated the key factois and
assumptions used to develop this estimate in detei�nining that it is reasonable in relation to
the financial statements taken as a whole.
The financial statement disclosur•es are neutral, consistent and clear.
4810 White Bear Parkway, St. Paul, MN, 55110 651.426.7000 www.redpathcpas.com
City of Chanhassen, Minnesota
Communication With Those Charged With Governance
Page 2
Difficulties Encountered in Performing the Audit
We encountered no difficulties in dealing with management in performing and
completing our audit.
Corrected and Uncorrected Misstatements
Professional standards require us to accumulate all known and likely misstatements
identified durin�the audit, other than those that are clearly trivial, and cormnunicate them to
the appropriate level of management. We identified one known uncorrected misstatement of
the financial statements:
• Constiuction r•elated expenditures of appr•oximately $699,000 were capitalized and
recorded as construction in progress at December 31, 2013. During 2014,
manageinent determined these costs related to a state highway and, therefor•e, should
not have been capitalized as an asset of the City. To correct the matter, the costs were
expensed dui7ng 2014.
Management has determined that the effects of the above misstateinent are immaterial,
both individually and in the aggi•egate, to the financial statements taken as a whole. In
addition, none of the misstatements detected as a result of audit procedures and coi7•ected by
management were material, either individually or in the aggregate, to each opinion unit's
financial statements taken as a whole.
Disagreements with Management
For purposes of this letter•, a disagl•eement with manageinent is a financial accounting,
reporting, or auditing matter, whether or not resolved to our satisfaction, that could be
significant to the financial statements oi•the auditoc•'s r•eport. We are pleased to report that no
such disagreements arose during the course of our audit.
Management Representations
We have r•equested certain representations fi•om management that ar•e included in the
management representation letter•dated May 19, 2015.
Management Consultations with Other Independent Accountants
In some cases, management may decide to consult with other accountants about auditing
and accounting matters, similar to obtaining a"second opinion" on certain situations. If a
consultation involves application of an accounting principle to the City's �nancial statements
or a determination of the type of auditor's opinion that may be expressed on those statements,
our professional standar•ds require the consulting accountant to check with us to determine
that the consultant has all the relevant facts. To our•knowledge, there wer•e no such
consultations with other accountants.
City of Chanhassen, Minnesota
Communication With Those Char•ged With Governance
Page 3
Other Audit Findings or Issues
We generally discuss a variety of matter•s, including the application of accounting
principles and auditing standai�ds, with management each year•prior to retention as the City's ,
auditors. However, these discussions occui7•ed in the normal course of our professional
relationship and our responses were not a condition to our retention.
Other Matters �
We applied certain limited procedui•es to management's discussion and analysis, the
budgetary comparison information and the schedule of funding progress, which are required
supplementary information(RSI) that supplements the basic financial statements. Our
procedures consisted of inquiries of management regarding the methods of preparing the
information and comparing the infor7nation for consistency with management's responses to
our inquiries, the basic financial statements, and other knowledge we obtained during our
audit of the basic financial statements. We did not audit the RSI and do not express an
opinion or provide any assurance on the RSI.
We were engaged to report on the combining and individual nonmajor fund financial
statements and schedules which accompany the financial statements but are not RSI. With
respect to this supplementaiy information, we made cei�tain inquir•ies of management and
evaluated the form, content, and inethods of prepar•ing the information to determine that the
infoi-mation complies with accounting principles generally accepted in the United States of
America, the method of preparing it has not changed from the prior period, and the
information is appropriate and complete in relation to om•audit of the financial statements.
We compared and r•econciled the supplementaiy information to the underlying accounting
records used to prepare the financial statements or to the financial statements themselves.
We were not engaged to report on the introductoiy section, the statistical section or the
other infoi7nation, which accompany the financial statements but are not RSI. We did not
audit or perfoi7n other procedures on this other infoimation and we do not express an opinion
or provide any assurance it.
Restriction on Use
This information is intended solely for the use of the City Council and management of
the City of Chanhassen, Minnesota and is not intended to be, and should not be, used by
anyone other than these specified parties.
.
�2�� ��.�-� � , L� .
REDPATH AND COMPANY, LTD.
St. Paul, Minnesota
May 19, 2015
CITY OF CHANHASSEN, MINNESOTA
SCHEDULE OF EXPENDITURES OF FEDERAL
AWARDS AND INDEPENDENT
AUDITOR'S REPORTS
For The Year Ended December 31, 2014
CITY OF CHANHASSEN, MINNESOTA
TABLE OF CONTENTS
Page No.
independent Auditor's Report on Internal Conn•ol over Financial Repar-ting
and on Compliance and Other Matters Based on an Audit of Financial
Statements Performed in Accordance with Gover��ment Auditis�g Standa�ds 1
lndependent Auditor's Report on Compliance for each Major•Program and � ��,
Internal Control over Compliance Required by OMB Cii�cular A-133 3 �
Schedule of Expenditures of Federal Awards 6
Schedule of Findings and Questioned Costs 7
. � � � � �: � . . .
A N CJ C O P✓ � A N Y
INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL
REPORTiNG AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN
AUDIT OF FINANCIAL STATEMENTS PERFORMED 1N ACCORDANCE WITH
GO VERNMENT A UDITING STANDARDS
To the Honorable Mayor, Members of
the City Council and Management
City of Chanhassen, Minnesota
We have audited, in accordance with the auditing standards generally accepted in the United
States of America and the standards applicable to financial audits contained in Gove�nment
Auditing Standa�ds issued by the Comptr•oller Genei•al of the United States, the financial
staternents of the governmental activities, the business-type activities, each major fund and
the aggregate remaining fund infolmation of the City of Chanhassen, Minnesota, as of and
for the year•ended December 31, 2014, and the related notes to the financial statements,
which collectively comprise the City of Chanhassen, Minnesota's basic financial statements
and have issued our report thereon dated May 19, 2015.
Internal Control Over Financial Reporting
In planning and perfor7ning our audit of the financial statements, we considered the City of
Chanhassen, Minnesota's internal control over financial reporting (internal control) to
determine the audit procedures that are appropriate in the circumstances for the puipose of
expressing our•opinions on the financial statements, but not for the puipose of expressing an
opinion on the effectiveness of the City of Cllanhassen, Minnesota's internal control.
Accordingly, we do not expi•ess an opinion on the effectiveness of the City of Chanhassen,
Minnesota's internal control.
A deficiency in inte�nal control exists when the design or oper•ation of a control does not allow
management or employees, in the noimal cow•se of perfoiming their assigned functions, to
prevent, or detect and correct, misstatements on a timely basis. A mateNial weakness is a
deficiency, or a combination of deficiencies, in internal conti•ol such that there is a reasonable
possibility that a material misstatement of the entity's financial statements will not be
prevented, or detected and coi7�ected on a timely basis. A significant defi.ciency is a deficiency,
or a combination of deficiencies, in internal control that is less sever•e than a material
weakness, yet iinportant enough to merit attention by those charged with governance.
4810 White Bear Parkway, St. Paul, MN, 55110 651.426.7000 www.redpathcpas.com
1
Our consideration of inteinal control was for the limited purpose described in the first
paragi•aph of this section and was not designed to identify all deficiencies in internal cont�•ol
that might be material weaknesses or significant deficiencies. Given these limitations, during
our•audit we did not identify any deficiencies in internal control that we consider to be material
weaknesses. However, material weaknesses may exist that have not been identi�ed.
Compliance and Other Matters
As pai�t of obtaining reasonable assur•ance about whether the City of Chanhassen,
Minnesota's financia] statements are free from inaterial misstatement, we perfoimed tests of
its compliance with certain provisions of laws, regulations, contracts and grant agreements,
noncompliance with which could have a direct and material effect on the deteimination of
financial statement amounts. However, providing an opinion on compliance with those
provisions was not an objective of our audit and, and accordingly, we do not express such an
opinion. The results of our tests disclosed no instances of noncompliance or other matters
that are required to be r•epoi�ted under Government Auditing Standards.
Purpose of this Report ���
The puipose of this report is solely to describe the scope of our testing of internal control and �
compliance and the results of that testing, and not to provide an opinion on the effectiveness '
of the entity's internal control or on compliance. This report is an integral part of an audit
per•foimed in accordance with Government Auditing Standards in considering the entity's �
internal control and compliance. Accordingly, this cominunication is not suitable for any ,
other purpose.
�
�22� �� � `�
REDPATH AND COMPANY, LTD.
St. Paul, Minnesota
May 19, 2015
2
., . . ��.,,� - .
�._ _ L��� � ��! ��wK��,v". ,,..,,
Auo cnrJ� � t� t� v
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR
PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE AND REPORT ON
THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS REQUIRED BY OMB
CIRCULAR A-133
To the Honor•able Mayor and
Members of the City Council
City of Chanhassen, Minnesota
Report on Compliance for Each Major Federal Program
We have audited the City of Chanhassen, Minnesota's compliance with the types of
compliance requu•ements described in the OMB Circula�A-133 Compliance Supplement that
could have a direct and material effect on each of the City of Chanhassen, Minnesota's major
federal pi•ograms for the yeai•ended December 31, 2014. The City of Chanhassen,
Minnesota's major federal programs are identified in the summaty of auditor's results section
of the accompanying schedule of findings and questioned costs.
Management's Responsibility
Management is responsible for compliance with the requirements of laws, regulations,
contracts, and gr•ants applicable to its federal programs.
Auditor's Responsibility
Our responsibility is to express an opinion on compliance for each of the City of Chanhassen,
Minnesota's major federal prograins based on our audit of the types of compliance
requirements refen�ed to above. We conducted our audit of compliance in accordance with
auditing standards gener•ally accepted in the United States of America; the standards
applicable to financial audits contained in GoveNnment Auditing Standards, issued by the
Compt�•oller General of the United States; and OMB Circular A-133,Audits of States, Local
Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133
i•equire that we plan and perform the audit to obtain reasonable assurance about whether
noncoinpliance with the types of compliance requirements refen•ed to above that could have
a direct and mater•ial effect on a major•federal progr•am occur-�•ed. An audit includes '
examining, on a test basis, evidence about the City of Chanhassen, Minnesota's compliance �
with those requirements and performing such other procedures as we considered necessaiy in
the circumstances.
4810 White Bear Parkway, St. Paul, MN, 55110 651.426.7000 www.redpathcpas.com I�'
3
We believe that our audit provides a reasonable basis for our opinion on compliance for each ���
major federal program. However, our audit does not provide a legal deteimination on the ,
City of Chanhassen, Minnesota's coinpliance with those requit•e�nents. ��
Opinion on Each Major Federal Program il
In our opinion, the City of Chanhassen, Minnesota, complied, in all material respects, with
the compliance requirements refer7•ed to above that could have a direct and material effect on
each of its major federal progr•ams for•the year ended December 31, 2014.
Report on Internal Control Over Compliance
Management of the City of Chanhassen, Minnesota is r•esponsible for establishing and
maintaining effective internal control ove�•compliance with the types of compliance
requirements refei-�•ed to above. In planning and perfo�ming our audit of compliance, we
considered the City of Chanhassen, Minnesota's internal control over coinpliance with the
types of requirements that could have a direct and material effect on each major federal
program to determine the auditing procedures that are appropr•iate in the circumstances for
the putpose of expressing an opinion on compliance for each major fedei�al program and to
test and report on internal contr•ol over compliance in accordance with OMB Circular A-133,
but not for the puipose of expressing an opinion on the effectiveness of internal cont�•ol over
compliance. Accor�dingly, we do not express an opinion on the effectiveness of the City of
Chanhassen, Minnesota's internal cont�•ol over compliance.
A deficiency in iiaterncrl control over compliance exists when the design or oper•ation of a
control over compliance does not allow inanagement or employees, in the noimal course of
performing their assigned functions, to prevent, or detect and coi-��ect, noncompliance with a
type of compliance requit•ement of a federal program on a timely basis. A material weakness
in inte�nal control over compliance is a deficiency, oi•combination of deficiencies, in
internal cont�•ol over compliance, such that there is a reasonable possibility that material
noncompliance with a type of compliance requirement of a federal program will not be
prevented, oi•detected and corrected, on a timely basis. A significant deficiency in internal
contNol over compliance is a deficiency, or combination of deficiencies, in internal control
over compliance with a type of compliance requirement of a federal program that is less
severe than a mater•ial weakness in internal conti•ol over compliance, yet important enough to
merit attention by those char•ged with governance.
Our consideration of intei-nal control over compliance was for the limited puipose described
in the fir•st paragraph of tlus section and was not designed to identify all deficiencies in
internal contr•ol over compliance that might be mater•ial weaknesses or significant
deficiencies. We did not identify any deficiencies in internal cont�•ol over coinpliance that
4
we consider to be material weaknesses. However, material weaknesses may exist that have '���
not been identified.
Report on Schedule of Expenditures of Federal Awards Required by OMB Circular A- I
133
We have audited the financial statements of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information of the City of
Chanhassen, Minnesota, as of and for the year ended December 31, 2014, and the related
notes to the financial statements, which collectively comprise the City of Chanhassen,
Minnesota's basic financial statements. We have issued our repor-t thereon dated May 19,
2015, which contained unmodified opinions on those financial stateinents. Ou1• audit was
conducted for the putpose of forming our opinions on the financial statements that
collectively comprise the City of Chanhassen, Minnesota's basic financial stateinents. The
accoinpanying schedule of expenditur•es of federal awards is presented for puiposes of
additional analysis as required by OMB Circular A-133, and is not a required part of the
basic financial statements. Such information is the responsibility of management and was
derived from and relates dir•ectly to the under•lying accounting and other r•ecords used to
prepare the basic financial statements. The information has been subjected to the auditing
procedures applied in the audit of the financial statements and certain additional procedur•es,
including coinparing and reconciling such information directly to the underlying accounting
and other•records used to prepare the basic financial statements or to the basic financial
statements themselves, and other additional pr•ocedures in accordance with auditing standar•ds
generally accepted in the United States of America. In our opinion, the schedule of
expenditui•es of feder•al awards is fau•ly stated in all material respects in relation to the basic
financial statements as a whole.
Purpose of this Report
The pmpose of this report on internal control over compliance is solely to desci-ibe the scope
of our testing of inter-nal control over compliance and the results of that testing based on the
requirements of OMB Cir•cular A-133. Accordingly, this r•eport is not suitable for any other
putpose.
���2ti� ��� , ` L� �
REDPATH AND COMPANY, LTD.
St. Paul, Minnesota
May 19, 2015
5
CITY OF CHANHASSEN, MINNESOTA
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
For The Year Ended December 31, 2014
Federal Grantor/ Federal Pass-1'l�rough
Pass-Through Grantor/ CTDA �ntit��Identif,ying Federal
Program Title Number Number Expenditures
ti.S.Department of Transportation:
Passed-through State of Minnesota:
Highway Planning and ConstrucYion 20.205 97986 51,347,125
Total Aigl�way Planning and Construction 1,347,125
U.S.Department of Home►and Security:
Passed-through State of Minnesota: '
Federal Eviergency Management Agency(FEMA) 97.036 N/A-none noted 20,108 '
Total U.S.Deparhnent ofHomeland Security 20,108 'I
Total Expenditures of Federal Awards $1,367,233
Notes to the Sc/2edule of Experzditures of Federal Awards
Note 1. Basis ofPresentation
The Schedule of Expenditures of Federal Awards(the Schedule)presents the activily of'f'eder-al award progrmns eapended by
the Cih�of Chanhassen,Minnesota under programs of the federal goverrrment.far the yem�ended December 31,2014. The
Schedirle is presented ari accordance with the reguirernents of OMB Circula��A-133,Audi�of States,Loca!Gonernn�ents and
Nori-Pro�i�Orgmrizatioris. Because the Schedu/e presents only n selected portion of Ihe operations of/he City�of Chanl�assen,
Minnesota,i�is not interided to ar:d does�zol present the financial positions,or change in,firaarrcial position ofthe Cily
ofChanhassen,Minnesota
Note 2. Summar7�of Signa'ftcant Accoi�nzing Policies
A. The expenditures on zhis Schedule m�e on tlie modifed accrual basis of accountirig.
B.Pass-thr�ough entiry identi�ying rrumbers af�e presented where available.
Note 3. Subrecipients
Of the federal expenditures presented in the sclzedule,the Cit��of Clianlzassen,Minnesota pronided.federa/awards to
surecipients asfollows: None
6
CITY OF CHANHASSEN, MINNESOTA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
For The Year Ended Deceinber 31, 2014
SECTION I - SUMMARY OF AUDIT RESULTS
Financial Statements
A. Type of auditors' report issued: Unmodified
B. Internal control over financial reporting:
• Material weakness(es) identified? Yes X No
• Significant deficiencies identified that are not Yes X None
considered to be inaterial weaknesses? reported
C. Noncompliance material to financial statenzents Yes X No
noted?
Federal Awards
D. Internal contr•ol over major pr•ograms:
• Material weakness(es) identified? Yes X No
� Significant deficiencies identified that are not Yes X None
considered to be material weaknesses? reported
E. Type of auditors' r•eport issued on compliance for Unmodified
major pr•ograms:
F. Any audit findings disclosed that are required to be Yes X None
reported in accordance with section 510(a) of 1'epar-ted
Circular A-133?
7
CITY OF CHANAASSEN, MINNESOTA ,
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
For The Year Ended December 31, 2014
Name of Federal Program CFDA Number
G. Identification of major progr�ams:
Highway Planning and Construction 20.205 '
H. Dollar tlu�eshold used to distinguish between Type A and $300,000
Type B programs:
L Auditee qualified as a low-risk auditee? Yes X No ��
8
CITY OF CHANHASSEN, MINNESOTA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
For The Year Ended December 31, 2014
SECTION II—FINANCIAL STATEMENT FINDINGS
There were no financial statement findings for 2014.
SECTION III—FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
There were no federal award findings for 2014.
SECTION IV—PRIOR YEAR FINDINGS—FEDERAL AWARDS
Ther•e wei•e no federal award findings for•2013.
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