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2008 Annual Financial Report COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE CITY OF CHANHASSEN, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2008 Finance Department Greg Sticha, Finance Director Member of Government Finance Officers Association of United States and Canada - This page intentionally left blank - CITY OF CHANHASSEN, MINNESOTA TABLE OF CONTENTS Page ReferenceNo. I. INTRODUCTORY SECTION Letter of Transmittal3 Certificate of Achievement7 Organization9 Organization Chart10 II. FINANCIAL SECTION Independent Auditor's Report13 Management's Discussion and Analysis15 Basic Financial Statements: Government-Wide Financial Statements: Statement of Net AssetsStatement 131 Statement of ActivitiesStatement 232 Fund Financial Statements: Balance Sheet - Governmental FundsStatement 334 Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental FundsStatement 436 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds Statement 538 Statement of Net Assets - Proprietary FundsStatement 639 Statement of Revenues, Expenses and Changes in Fund Net Assets - Proprietary FundsStatement 740 Statement of Cash Flows - Proprietary FundsStatement 841 Statement of Net Assets - Fiduciary FundsStatement 942 Notes to Financial Statements43 Required Supplementary Information: Budgetary Comparison Schedule - General FundStatement 1080 Budgetary Comparison Schedule - Note to RSI86 CITY OF CHANHASSEN, MINNESOTA TABLE OF CONTENTS Page ReferenceNo. Combining and Individual Fund Statements and Schedules: Combining Balance Sheet - Nonmajor Governmental FundsStatement 1190 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental FundsStatement 1291 Subcombining Balance Sheet - Nonmajor Special Revenue FundsStatement 1394 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Special Revenue FundsStatement 1495 Subcombining Balance Sheet - Nonmajor Debt Service FundsStatement 1598 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Debt Service FundsStatement 16100 Subcombining Balance Sheet - Nonmajor Capital Project FundsStatement 17104 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Capital Project FundsStatement 18107 Special Revenue Funds: Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual: Contribution FundStatement 19110 CATVStatement 20111 Combining Statement of Net Assets - Agency FundsStatement 21114 Combining Statement of Changes in Assets and Liabilities - Agency FundsStatement 22115 Supplementary Financial Information: Combined Schedule of IndebtednessExhibit 1118 Debt Service Payments to Maturity: General Obligation BondsExhibit 2120 General Obligation Improvement BondsExhibit 3121 Revenue BondsExhibit 4122 Taxable Valuations, Tax Levies and Tax RatesExhibit 5123 Schedule of Deferred Tax LeviesExhibit 6124 CITY OF CHANHASSEN, MINNESOTA TABLE OF CONTENTS Page ReferenceNo. III. STATISTICAL SECTION (UNAUDITED) Financial Trends: Net Assets by ComponentTable 1127 Changes in Net AssetsTable 2128 Fund Balances - Governmental FundsTable 3130 Changes in Fund Balances - Governmental FundsTable 4131 Revenue Capacity: Tax Capacity and Estimated Market Value of Taxable PropertyTable 5132 Direct and Overlapping Property Tax RatesTable 6134 Principal Property TaxpayersTable 7135 Property Tax Levies and CollectionsTable 8137 Debt Capacity: Ratios of Outstanding Debt by TypeTable 9138 Direct and Overlapping Governmental Activities DebtTable 10140 Legal Debt Margin InformationTable 11141 Pledged Revenue CoverageTable 12142 Demographic and Economic: Demographic and Economic StatisticsTable 13143 Principal EmployersTable 14145 Operating Information: Full-Time Equivalent City Government Employees by Function/ProgramTable 15146 Operating Indicators by Function/ProgramTable 16148 Capital Asset Statistics by Function/ProgramTable 17150 - This page intentionally left blank - I. INTRODUCTORY SECTION 1 - This page intentionally left blank - 2 These strategies and the long term general fund budget are updated on an annual basis as part of our goal setting strategies at the beginning of each year. In addition 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. Cash Management Policies and Practices The primary financial goal of the City investment strategy is to ensure the safety of the principal invested by the City. The City only invests in instruments that are covered under Minnesota Statute 475.66. Cash balances from all City funds are pooled into the Investment Trust Fund, and investment income is then distributed on a pro-rata basis with final allocation occurring at year end. Risk Management The City contracts with outside agencies to provide insurance protecting the City from potential claims such as workers' compensation, general liability and auto liability. Certificate of Achievement The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Chanhassen for its comprehensive annual financial report (CAFR) for the fiscal year ended December 31, 2007. The Certificate of Achievement is a prestigious national award recognizing conformance with the highest standards for preparation of state and local government financial reports. In order to be awarded a Certificate of Achievement, a governmental unit must publish an easily readable and efficiently organized comprehensive annual financial report, whose contents conform 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 for the last sixteen consecutive years (fiscal years ended 1992 – 2007). We believe our current report continues to conform to the Certificate of Achievement program requirements and we are submitting it to GFOA to determine its eligibility for another certificate. Independent Audit State law provides that the city may arrange for examination of its books, records, 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 provide for a complete annual audit of city records by Certified Public Accountants. The auditors' opinion has been included in this report. Acknowledgments We wish to express our appreciation to the members of the City Council for their support in improving the financial condition of the City. We also want to thank the Finance Department staff and department directors for their assistance in compiling the information necessary for this report. Finally, we wish to acknowledge HLB Tautges Redpath, Ltd. for their assistance in preparing this report. Respectfully submitted, Greg Sticha, Finance Director 5 - This page intentionally left blank - 6 Certificate of Achievement for Excellence in Financial Reporting Presented to City of Chanhassen Minnesota Text38: For its Comprehensive Annual Financial Report for the Fiscal Year Ended December 31, 2007 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting. President Executive Director 7 - This page intentionally left blank - 8 CITY OF CHANHASSEN, MINNESOTA ORGANIZATION December 31, 2008 Term Expires Mayor: Tom Furlong12/31/10 Council Members: Bethany Tjornhom12/31/12 Vicki Erns12/31/10 t Jerry McDonald12/31/12 Bryan Litse12/31/10 y City Manager: Todd GerhardtAppointed Finance Director: Greg StichaAppointed Community Development Director: Appointed Kathryn Aanenso n Public Works Director/City Engineer: Paul OehmeAppointed Parks and Recreation Director: Todd HoffmanAppointed 9 CityofChanhassen,Minnesota CityofChanhassen,Minnesota Organization Chart Citizens EnvironmentalSenior CommissionCommission PlanningPark & RecreationPark & Recreation Mayor -Council CommissionCommission Economic Development Development Authority Administration Law EnforcementPublicCommunityParks and Finance & FireWorksDevelopmentRecreation Administration Administration 10 II. FINANCIAL SECTION 11 - This page intentionally left blank - 12 MANAGEMENT’S DISCUSSION AND ANALYSIS As management of the City of Chanhassen, Minnesota, we offer readers of the City of Chanhassen, Minnesota’s financial statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended December 31, 2008. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal, which can be found in the introductory section of this report. Financial Highlights The assets of the City of Chanhassen, Minnesota exceeded its liabilities at the close of the most recent fiscal year by $167,229,402 (net assets). Of this amount, $28,288,714 (unrestricted net assets) may be used to meet the government’s ongoing obligations to citizens and creditors in accordance with the City's fund designations and fiscal policies. The City’s total net assets increased by $2,030,532. As of the close of the current fiscal year, the City of Chanhassen, Minnesota’s governmental funds reported combined ending fund balances of $31,037,444. The amount designated or reserved through legal restrictions and City Council authorization is $29,537,511. At the end of the current fiscal year the general fund balance of $4,881,719, included $21,173 reserved, $3,586,750 designated and $1,273,796 undesignated. The City’s total debt increased by $3,258,589 during the current fiscal year, from $35,866,087 to $39,124,676. The increase is attributed to the following: a new bond issue of $7,550,000 for the public works facility, scheduled principal payments of $3,910,000, and adjustments to the state loan for Highway 212 of approximately $175,000. Overview of the Financial Statements The management’s discussion and analysis is intended to serve as an introduction to the City of Chanhassen, Minnesota’s basic financial statements. The City’s basic financial statements are comprised of three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary 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 the City of Chanhassen, Minnesota’s finances, in a manner similar to a private-sector business. The statement of net assets presents information on all of the City of Chanhassen, Minnesota’s assets and liabilities, with the difference between the two reported as net assets. 15 Managements Discussion and Analysis ’ Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the City of Chanhassen, Minnesota is improving or deteriorating. The statement of activities presents information showing how the City’s net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless 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 of Chanhassen, Minnesota that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City of Chanhassen, Minnesota include general government, public safety, public works, parks and recreation and community development. The business-type activities of the City of Chanhassen, Minnesota include water, sewer, and surface 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 for specific activities or objectives. The City of Chanhassen, Minnesota, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City of Chanhassen, Minnesota can be divided into three categories: governmental funds, proprietary funds and fiduciary 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-term inflows and outflows of spendable resources, 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 governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand 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 governmental funds and governmental activities. 16 Managements Discussion and Analysis ’ The City of Chanhassen, Minnesota maintains four individual major governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures and changes in fund balances for the following major funds: General Fund 2006A G.O. Improvement Bonds Fund Public Works Facility Revolving Assessment Fund Data from the other governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements elsewhere in this report. The City of Chanhassen, Minnesota adopts an annual appropriated budget for its general and special revenue funds. A budgetary comparison statement has been provided for those funds to demonstrate compliance with this budget. The basic governmental fund financial statements can be found on statements 3 through 5 of this report. Proprietary funds . The City of Chanhassen, Minnesota 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 government-wide financial statements. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for the following funds: Water Sewer Surface Water Management The basic proprietary fund financial statements can be found on statements 6 through 8 of this report. Fiduciary funds . Fiduciary funds are used to account for resources held for benefit of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support the City of Chanhassen, Minnesota’s own program. The accounting used for fiduciary funds is much like that used for proprietary funds. The basic fiduciary fund financial statement can be found on statement 9 of this report. 17 Managements Discussion and Analysis ’ Notes to the financial statements . The notes provide additional information 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 governmental funds are presented immediately following the required supplementary information on budgetary comparisons. Combining and individual fund statements and schedules can be found on statement 11 through statement 22 of this report. Government-Wide Financial Analysis As noted earlier, net assets may serve over time as a useful indicator of a government's financial position. In the case of the City of Chanhassen, Minnesota, assets exceeded liabilities by $167,229,402 at the close of the most recent fiscal year. The largest portion of the City of Chanhassen, Minnesota’s net assets ($126,153,120 or 75.4%) reflects its investment in capital assets (e.g. land, buildings, machinery, and equipment) net of any related debt used to acquire those assets that is still outstanding. The City of Chanhassen, Minnesota uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City of Chanhassen, Minnesota’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 themselves cannot be used to liquidate these liabilities. CITY OF CHANHASSEN, MINNESOTA'S NET ASSETS Governmental ActivitiesBusiness-Type ActivitiesTotals 200820072008200720082007 Current and other assets$37,338,712$30,497,159$13,870,692$17,916,543$51,209,404$48,413,702 Capital assets88,717,20789,110,54567,956,75266,417,257156,673,959155,527,802 Total assets$126,055,919$119,607,704$81,827,444$84,333,800$207,883,363$203,941,504 Long-term liabilities outstanding$26,606,863$21,846,990$12,517,813$14,019,097$39,124,676$35,866,087 Other liabilities878,7292,303,043650,556520,3401,529,2852,823,383 Total liabilities$27,485,592$24,150,033$13,168,369$14,539,437$40,653,961$38,689,470 Net assets: Invested in capital assets, net of related debt$70,611,368$68,982,379$55,541,752$52,502,257$126,153,120$121,484,636 Restricted12,787,56811,844,126 - - 12,787,56811,844,126 Unrestricted15,171,39114,631,16613,117,32317,292,10628,288,71431,923,272 Total net assets$98,570,327$95,457,671$68,659,075$69,794,363$167,229,402$165,252,034 18 Managements Discussion and Analysis ’ A portion of the of the City of Chanhassen, Minnesota’s net assets represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net assets ($28,288,714) may be used to meet the City's ongoing obligations to citizens and creditors. At the end of the current fiscal year, the City of Chanhassen, Minnesota is able to report positive balances in all three categories of net assets, both for the government as a whole, as well as for its separate governmental and business-type activities. Governmental Activities Total net assets of the City’s governmental activities increased $3,112,656, or 3.3%. The components of net assets increased or decreased as follows: Net assets invested in capital assets, net of related debt, increased $1,628,989 due primarily to retirement of debt. Net assets restricted for debt service increased $1,118,591 due primarily to assessment rolls adopted in 2008. Net assets restricted for tax increment purposes decreased $175,149. Unrestricted net assets increased $540,225. Liabilities increased $3,335,559, or 13.8%, in 2008. This was primarily due to the increase in loans and bonds payable of $4,686,959 (as noted previously in the Financial Highlights section) and the decrease of other governmental and miscellaneous payables of approximately $1.1 million. 19 Managements Discussion and Analysis ’ Business-type Activities The net assets of the City’s business-type activities decreased by $1,082,124, or 1.6%. Amounts invested in capital assets, net of related debt increased $3,039,495 while unrestricted net assets decreased $4,174,783, due to amounts expended for various infrastructure projects. City of Chanhassen, Minnesota's Changes in Net Assets Governmental ActivitiesBusiness-Type ActivitiesTotals 200820072008200720082007 Revenues: Program revenues: Charges for services$3,051,081$3,449,688$5,074,906$5,099,975$8,125,987$8,549,663 Operating grants and contributions346,023452,79836,35045,172382,373497,970 Capital grants and contributions3,221,6367,464,6971,527,6243,340,5984,749,26010,805,295 General revenues: Property taxes9,651,7589,419,763 - - 9,651,7589,419,763 Tax increment collections574,101420,526 - - 574,101420,526 Grants and contributions not restricted to specific programs108,039189,616 - - 108,039189,616 Unrestricted investment earnings1,150,9931,397,746797,079786,4551,948,0722,184,201 Miscellaneous - - 22,464127,14322,464127,143 Gain on sale of capital assets32,19510,806 - - 32,19510,806 Total revenues18,135,82622,805,6407,458,4239,399,34325,594,24932,204,983 Expenses: General government2,469,0552,439,716 - - 2,469,0552,439,716 Public safety3,062,9413,098,068 - - 3,062,9413,098,068 Public works6,220,8167,010,981 - - 6,220,8167,010,981 Parks and recreation3,025,9873,023,032 - - 3,025,9873,023,032 Community development704,9791,052,104 - - 704,9791,052,104 Interest on long-term debt652,015835,059 - - 652,015835,059 Water - - 3,234,1393,112,5753,234,1393,112,575 Sewer - - 3,072,5883,177,3663,072,5883,177,366 Surface water management - - 1,121,1971,238,9141,121,1971,238,914 Total expenses 16,135,79317,458,9607,427,9247,528,85523,563,71724,987,815 Increase in net assets before transfers2,000,0335,346,68030,4991,870,4882,030,5327,217,168 Transfers1,112,623(5,077,531)(1,112,623)5,077,531 - - Change in net assets3,112,656269,149(1,082,124)6,948,0192,030,5327,217,168 Net assets - beginning, as previously stated95,457,67195,188,52269,794,36362,846,344165,252,034158,034,866 Prior period adjustment - - (53,164) - (53,164) - Net assets - beginning, as restated95,457,67195,188,52269,741,19962,846,344165,198,870158,034,866 Net assets - ending$98,570,327$95,457,671$68,659,075$69,794,363$167,229,402$165,252,034 20 Managements Discussion and Analysis ’ Governmental Activities Revenues Revenues for the City’s governmental activities decreased by $4,669,814, or 20.5%. Capital grants and contributions decreased by approximately $4.2 million due to smaller assessment rolls adopted in 2008 and fewer prepaid assessments as compared to 2007. Also impacting revenues was a $400,000 decrease in charges for services resulting from slowed development activities within the City. Expenses Expenses for the City’s governmental activities decreased by $1,323,167, or 7.6%. Public works and community development expenditures decreased approximately $1.1 million while other functions remained relatively flat in comparative expenses from the previous year. No specific significant items can be attributed to the decreases in expenses during 2008. Below are specific graphs which provide comparisons of the governmental activities revenues and expenses: Governmental Activities -Revenues Grants and contributions not restricted to specific Tax increment collections programs .6% Miscellaneous Unrestricted 3.2% .1% investment earnings 6.3% Charges for services 16.9% Operating grants and contributions 1.9% Property taxes 53.2% Capital grants and contributions 17.8% 21 Managements Discussion and Analysis ’ Governmental Activities -Expenses Interest on long-term debt General government 15.3% 3.9% Community development 4.4% Parks and recreation 18.8% Public Safety 19% Public works 38.6% Business-Type Activities Revenues Revenues for the City’s business-type activities decreased by $1,940,920, or 20.6%. Decreased revenue from connection charges ($1,502,693) and decreased asset contributions from developers ($267,082) primarily account for the decrease. In addition to the decrease in revenues mentioned above, transfers to business-type activities on the statement of activities decreased from $5,077,531 in 2007 to $1,112,623 in 2008. This is due to significantly smaller transfers of capital assets from the governmental activities in 2008. Expenses The City’s expenses for business-type activities decreased by $100,931, or 1.3%. There are no specific significant items that can be attributed to the immaterial decrease. 22 Managements Discussion and Analysis ’ Below are specific graphs showing the business-type activities revenue and expense comparisons: Unrestricted investment earnings 10.7% Miscellaneous 0.3% Business-TypeActivities -Revenue Capital grants and contributions 20.5% Operating grants and contributions 0.5% Charges for services 68.0% Business-Type Activities -Expenses Surface water 15.1% Water 43.5% Sewer 41.4 23 Managements Discussion and Analysis ’ Financial Analysis of the Government's Funds Governmental Funds . The focus of the City of Chanhassen, Minnesota’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City of Chanhassen, Minnesota’s financing requirements. In particular, unreserved fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year. At the end of the current fiscal year, the City of Chanhassen, Minnesota’s governmental funds reported combined ending fund balances of $31,037,444. Approximately 73.6% of this total amount ($22,845,067) constitutes unreserved, but designated, fund balance.The reserved portion of the fund balance ($6,692,444) has already been committed 1) to provide for prepaid items ($21,198), 2) for future programs ($29,499), and 3) to pay debt service ($6,641,747). The general fund decreased by $609,567 in 2008, due to the transfer of $796,836 to the revolving assessment construction fund. This transfer was made because excess fund balance was available above and beyond the City’s required cash reserve policy and catastrophic contingency reserve. The 2006A G.O. Improvement Bonds debt service fund decreased by $518,750, which was due to scheduled principal and interest payments in 2008. The Public Works Facility capital project fund was created in 2008 to account for construction costs of the new public works facility. The remaining majority of the bond proceeds will be spent in 2009 and into early 2010. 24 Managements Discussion and Analysis ’ The Revolving Assessment fund increased by $1,914,760. The increase was due to transfers from enterprise funds for repayment of related construction costs for street reconstruction projects. The nonmajor special revenue funds decreased by $27,955 in 2008. No significant items can be attributed to this decrease. The nonmajor debt service funds decreased by $117,572 in 2008, due to regularly scheduled debt service payments. The nonmajor capital project funds increased by $354,949 due to increased collection of TIF proceeds and development related construction fees. Proprietary funds . The City of Chanhassen, Minnesota’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail. The unrestricted net assets in the respective proprietary funds are water $5,943,798, sewer $4,342,354 and surface water management $2,831,171. The water fund had an increase in net assets in 2008 of $54,922 while the sewer and surface water management funds had decreases in net assets of $612,602 and $524,444, respectively. Budgetary Highlights General Fund The expenditure and revenue budgets were not amended in 2008. Budgetary Variances – Revenues The positive general fund revenue variance of $115,253 was due to larger than anticipated collections of state aids and interest earnings. Budgetary Variances – Expenses The City’s expenses for the general fund had a positive variance of $72,016, which was less than 1% of the City’s total budget and no specific significant items attribute to this variance. 25 Managements Discussion and Analysis ’ Capital Asset and Debt Administration Capital assets . The City of Chanhassen, Minnesota’s, investment in capital assets for its governmental and business type activities as of December 31, 2008, amounts to $156,673,959 (net of accumulated depreciation). This investment in capital assets includes land, buildings, infrastructure, machinery and equipment. City of Chanhassen, Minnesota’s Capital Assets (Net of Depreciation ) BeginningEnding Primary GovernmentBalanceIncreaseDecreaseBalance Governmental activities: Capital assets - not depreciated: Land$16,296,657$728,100$ - $17,024,757 Construction in progress3,104,9292,491,304(1,276,989)4,319,244 Total capital assets not being depreciated19,401,5863,219,404(1,276,989)21,344,001 Capital assets - being depreciated: Buildings and structures15,203,969 - - 15,203,969 Machinery and equipment6,486,306442,673(123,470)6,805,509 Other improvements 4,502,292635,374 - 5,137,666 Infrastructure102,420,1421,594,631(104,400)103,910,373 Total capital assets being depreciated128,612,7092,672,678(227,870)131,057,517 Less accumulated depreciation for: Buildings and structures3,725,015368,077 - 4,093,092 Machinery and equipment3,883,136425,176(120,805)4,187,507 Other improvements 1,335,385191,247 - 1,526,632 Infrastructure49,960,2143,986,485(69,619)53,877,080 Total accumulated depreciation58,903,7504,970,985(190,424)63,684,311 Governmental activities capital assets - net89,110,545921,097(1,314,435)88,717,207 BeginningEnding Primary GovernmentBalanceIncreaseDecreaseBalance Business-type activities: Capital assets - not depreciated: Land$1,861,117$34,019$ - $1,895,136 Construction in progress4,002,8403,771,980(2,092,862)5,681,958 Total capital assets not being depreciated5,863,9573,805,999(2,092,862)7,577,094 Capital assets - being depreciated: Buildings and structures12,445,429 - - 12,445,429 Machinery and equipment2,199,29848,032(5,150)2,242,180 Other improvements 85,456,8162,737,368 - 88,194,184 Total capital assets being depreciated100,101,5432,785,400(5,150)102,881,793 Less accumulated depreciation for: Buildings and structures - 249,591 - 249,591 Machinery and equipment937,852130,003(3,863)1,063,992 Other improvements 38,610,3912,578,161 - 41,188,552 Total accumulated depreciation39,548,2432,957,755(3,863)42,502,135 Business-type activities capital assets - net66,417,2573,633,644(2,094,149)67,956,752 Total capital assets - net$155,527,802$4,554,741($3,408,584)$156,673,959 Additional information on the City of Chanhassen, Minnesota’s capital assets can be found in Note 4. 26 Managements Discussion and Analysis ’ Long-term debt . At the end of the current fiscal year, the City of Chanhassen, Minnesota had total bonds payable outstanding of $34,925,000, an increase of $3,640,000 from 2007. The increase is attributed to the issuance of the public works facility bonds less scheduled debt payments. The balance of the bonds payable outstanding is comprised of: $13,905,000 in general obligation bonds, $7,155,000 for special assessment debt which is supported in part by special assessments, $12,415,000 of revenue bonds which financed capital investments for the water, sewer and surface water management operations and $1,015,000 in tax increment bonds. Additional long-term debt in the amount of $820,748 for compensated absences was also outstanding at the end of 2008. Also outstanding is $3,375,125 for a loan construction payable to the State of Minnesota for the City’s portion of the costs related to the construction of State Highway 212. This project was substantially complete in 2008 and the total loan was for approximately $3.7 million. In early 2009, this loan along with the 2006A G.O. Improvement Bonds were refinanced. City of Chanhassen, Minnesota’s Outstanding Debt Governmental ActivitiesBusiness-Type ActivitiesTotals 200820072008200720082007 General obligation bonds$13,905,000$7,315,000$ - $ - $13,905,000$7,315,000 Revenue bonds435,000530,00012,415,00013,915,00012,850,00014,445,000 Tax increment bonds1,015,0001,070,000 - - 1,015,0001,070,000 General improvement bonds 7,155,0008,455,000 - - 7,155,0008,455,000 Loan payable for highway construction3,375,1253,828,166 - - 3,375,1253,828,166 Compensated absences717,935648,824102,813104,097820,748752,921 Total$26,603,060$21,846,990$12,517,813$14,019,097$39,120,873$35,866,087 The City’s bond rating was upgraded to AA+ by Standard & Poor’s in November 2008 when the City issued its bonds for the public works facility. In early 2009, the City undertook a refunding (mentioned above) and Standard & Poor’s upgraded the City’s rating to AAA. The City of Chanhassen is one of only 12 communities in the State of Minnesota to have a AAA bond rating from either Standard & Poor’s or Moody’s. State statutes limit the amount of general obligation debt a Minnesota city may issue to 3% of total estimated market value. The current debt limitation for the City of Chanhassen, Minnesotais $101,847,843. Of the City's outstanding debt, $11,924,438 is counted within the statutory limitation. Additional information on the City of Chanhassen, Minnesota’s long-term debt can be found in Note 5. Requests for information. This financial report is designed to provide a general overview of the City of Chanhassen, Minnesota’s finances for all those with an interest in the government’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Director of Finance, 7700 Market Boulevard, P.O. Box 147, Chanhassen, Minnesota 55317. 27 - This page intentionally left blank - 28 BASIC FINANCIAL STATEMENTS 29 - This page intentionally left blank - 30 CITY OF CHANHASSEN, MINNESOTA Statement 1 STATEMENT OF NET ASSETS December 31, 2008 Primary Government GovernmentalBusiness-TypeTotals Assets:ActivitiesActivities20082007 Cash and investments$31,038,698$12,391,989$43,430,687$40,325,539 Accrued interest receivable219,353148,449367,802413,390 Due from other governmental units18,98912,70131,690479,801 Accounts receivable - net321,5081,025,6661,347,1741,339,041 Property taxes receivable417,816 - 417,816248,686 Special assessments receivable5,301,150263,1075,564,2575,574,589 Prepaid items21,1982,34023,53814,181 Inventories - at cost - 26,44026,44018,475 Capital assets (net of accumulated depreciation): Nondepreciable21,344,0017,577,09428,921,09525,265,543 Depreciable67,373,20660,379,658127,752,864130,262,259 Total assets126,055,91981,827,444207,883,363203,941,504 Liabilities: Accounts payable234,352111,665346,017712,870 Accrued interest payable110,495209,711320,206665,890 Contracts payable170,34699,689270,035370,053 Due to other governmental units20,834185,302206,136484,537 Salaries payable249,73744,189293,926252,945 Unearned revenue92,965 - 92,965337,088 Compensated absences payable: Due within one year44,5706,38250,95251,103 Due in more than one year673,36596,431769,796701,818 Other post employment benefits payable: Due in more than one year3,803 - 3,803 - Loans payable: Due within one year318,002 - 318,002279,552 Due in more than one year3,057,123 - 3,057,1233,548,614 Bonds payable: Due within one year2,235,000720,0002,955,0003,910,000 Due in more than one year20,275,00011,695,00031,970,00027,375,000 Total liabilities27,485,59213,168,36940,653,96138,689,470 Net assets: Invested in capital assets, net of related debt70,611,36855,541,752126,153,120121,484,636 Restricted for: Debt service12,165,653 - 12,165,65311,047,062 Tax increment purposes621,915 - 621,915797,064 Unrestricted15,171,39113,117,32328,288,71431,923,272 Total net assets$98,570,327$68,659,075$167,229,402$165,252,034 The accompanying notes are an integral part of these financial statements. 31 CITY OF CHANHASSEN, MINNESOTA STATEMENT OF ACTIVITIES For The Year Ended December 31, 2008 Charges For ExpensesServices Functions/Programs Primary government: Governmental activities: General government$2,469,055$441,160 Public safety3,062,9411,471,437 Public works6,220,816220,784 Parks and recreation3,025,987868,218 Community development704,97949,482 Interest and fees on long-term debt652,015 - Total governmental activities16,135,7933,051,081 Business-type activities: Water3,234,1392,408,379 Sewer3,072,5882,187,209 Surface water management1,121,197479,318 Total business-type activities7,427,9245,074,906 Total primary government$23,563,717$8,125,987 The accompanying notes are an integral part of these financial statements. 32 Statement 2 Net (Expense) Revenue and Program RevenuesChanges in Net Assets Primary Government OperatingCapital Totals Grants andGrants andGovernmentalBusiness-Type ContributionsContributionsActivitiesActivities20082007 $600$ - ($2,027,295)$ - ($2,027,295)($2,007,285) 215,973 - (1,375,531) - (1,375,531)(766,640) 100,0003,221,636(2,678,396) - (2,678,396)534,107 29,450 - (2,128,319) - (2,128,319)(2,002,894) - -(655,497) - (655,497)(1,014,006) - -(652,015) - (652,015)(835,059) 346,0233,221,636(9,517,053)0(9,517,053)(6,091,777) -776,384 -(49,376)(49,376)1,587,396 -290,915 - (594,464)(594,464)(266,476) 36,350460,325 - (145,204)(145,204)(364,030) 36,3501,527,6240(789,044)(789,044)956,890 $382,373$4,749,260(9,517,053)(789,044)(10,306,097)(5,134,887) General revenues: General property taxes9,651,758 - 9,651,7589,419,763 Tax increment collections574,101 - 574,101420,526 Grants and contributions not restricted to specific programs108,039 - 108,039189,616 Unrestricted investment earnings1,150,993797,0791,948,0722,184,201 Gain on sale of capital assets32,195 -32,19510,806 Miscellaneous -22,46422,464127,143 Transfers1,112,623(1,112,623) - - Total general revenues and transfers12,629,709(293,080)12,336,62912,352,055 Change in net assets3,112,656(1,082,124)2,030,5327,217,168 Net assets - beginning, as previously stated95,457,67169,794,363165,252,034158,034,866 Prior period adjustment -(53,164)(53,164) - Net assets - beginning, as restated95,457,67169,741,199165,198,870158,034,866 Net assets - ending$98,570,327$68,659,075$167,229,402$165,252,034 The accompanying notes are an integral part of these financial statements. 33 CITY OF CHANHASSEN, MINNESOTA BALANCE SHEET GOVERNMENTAL FUNDS December 31, 2008 366 2006A G.O. Improvement Bonds General Fund Assets: Cash and investments$5,143,207$3,005,717 Accrued interest receivable40,84430,437 Due from other governmental units18,989 - Accounts receivable - net19,411 - Due from other funds - - Property taxes receivable292,499 - Special assessments receivable2,5412,503,126 Prepaid items21,173 - Total assets$5,538,664$5,539,280 Liabilities and Fund Balances Liabilities: Accounts payable$126,679$ - Due to other funds - - Contracts payable - - Due to other governmental units20,834 - Salaries payable245,821 - Deferred revenue263,6112,503,126 Total liabilities656,9452,503,126 Fund balances: Reserved for: Prepaid items21,173 - Future programs - - Debt service - 3,036,154 Unreserved reported in: Designated: General Fund3,586,750 - Special Revenue Funds - - Capital Project Funds - - Undesignated reported in: General Fund1,273,796 - Special Revenue Funds - - Debt Service Funds - - Capital Project Funds - - Total fund balances4,881,7193,036,154 Total liabilities and fund balances$5,538,664$5,539,280 Fund balance reported above Amounts reported for governmental activities in the statement of net assets 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 current- period expenditures and, therefore, are deferred in the funds. Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported in the funds. Net assets of governmental activities The accompanying notes are an integral part of these financial statements. 34 Statement 3 Other 421 Public Works 601 Revolving GovernmentalIntra Activity FacilityAssessment FundFundsEliminationTotals Governmental Funds 20082007 $6,790,343$4,895,971$11,203,460$ - $31,038,698$24,011,172 10,81338,02399,236 -219,353257,366 - - - -18,989424,405 - -302,097 -321,508323,122 -13,409 -(13,409) - - -98,33626,981 -417,816248,686 -1,518,4781,277,005 - 5,301,1505,219,198 - -25 -21,19813,210 $6,801,156$6,564,217$12,908,804($13,409)$37,338,712$30,497,159 $45,326$1,900$60,447$ - $234,352$588,672 - -13,409(13,409) - - -158,42211,924 -170,346278,353 - - - -20,834455,776 - -3,916 -249,737216,016 -1,517,9031,341,359 - 5,625,9995,672,593 45,3261,678,2251,431,055(13,409)6,301,2687,211,410 - -25 -21,19813,210 - -29,499 -29,49934,733 - - 3,605,593 - 6,641,7477,300,492 - - - - 3,586,7503,416,950 - -525,692 -525,692548,438 6,755,8304,885,9927,090,803 - 18,732,6259,934,936 - - - - 1,273,7962,061,126 - - - - - - - -237,721 -237,721215,298 - -(11,584) -(11,584)(239,434) 6,755,8304,885,99211,477,749031,037,44423,285,749 $6,801,156$6,564,217$12,908,804($13,409)$37,338,712$30,497,159 $31,037,444$23,285,749 88,717,20789,110,545 5,533,0345,335,505 (26,717,358)(22,274,128) $98,570,327$95,457,671 The accompanying notes are an integral part of these financial statements. 35 CITY OF CHANHASSEN, MINNESOTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS For The Year Ended December 31, 2008 366 2006A G.O. General FundImprovement Bonds Revenues: General property taxes$6,581,268$ - Tax increment collections - - Licenses and permits1,378,003 - Intergovernmental302,947 - Special assessments - 30,044 Charges for services592,597 - Fines and forfeits124,633 - Investment income216,283163,519 Contributions and donations30,650 - Other207,172 - Total revenues9,433,553 193,563 Expenditures: Current: General government1,881,342 - Public safety2,835,279 - Public works2,108,722 - Parks and recreation1,850,446 - Community development420,495 - Capital outlay: General government - - Public safety - - Public works - - Parks and recreation - - Debt service: Principal - 470,000 Interest and paying agent fees - 242,313 Bond issuance costs - - Developer assistance - - Total expenditures9,096,284 712,313 Revenues over (under) expenditures337,269 (518,750) Other financing sources (uses): Bonds issued - - Loans issued - - Transfers in - - Transfers out(946,836) - Sale of capital assets - - Total other financing sources (uses)(946,836)0 Net change in fund balance(609,567)(518,750) Fund balance - January 15,491,2863,554,904 Fund balance - December 31$4,881,719$3,036,154 The accompanying notes are an integral part of these financial statements. 36 Statement 4 Other 421 Public Works 601 Revolving GovernmentalIntra Activity FacilityAssessment FundFundsEliminations Totals Governmental Funds 20082007 $ -$100,000$2,901,065$ - $9,582,333$9,403,109 -97,450476,651 -574,101420,526 - -432,542 - 1,810,5452,171,558 -300,0001,545,023 - 2,147,9701,148,034 - 457,503136,346 - 623,8933,922,517 - - 248,612 - 841,209738,669 - - - - 124,633145,682 69,425179,312522,454 - 1,150,9931,397,746 - - 12,760 - 43,41047,428 - 60,00022,105 - 289,277404,426 69,425 1,194,265 6,297,558 0 17,188,364 19,799,695 - - 221,170 - 2,102,5122,116,928 - - 50,017 - 2,885,2962,924,751 - 34,173643,502 - 2,786,3973,735,950 - - 82,907 - 1,933,3531,848,880 - - 48,324 - 468,819841,306 - - 233,600 - 233,6006,734 - - 54,284 - 54,284505,215 386,6422,838,9701,451,567 - 4,677,1796,693,387 - - 642,508 - 642,5081,491,848 - - 2,219,552 - 2,689,5521,750,000 - - 632,535 - 874,848769,212 93,811 - - - 93,811 - - - 226,055 - 226,055206,753 480,453 2,873,143 6,506,021 0 19,668,214 22,890,964 (411,028)(1,678,878)(208,463)0 (2,479,850)(3,091,269) 7,164,308 - 385,692 - 7,550,0003,014,744 - - 24,839 - 24,839 - 2,5503,863,6241,363,427(2,583,590)2,646,011537,564 - (269,986)(1,366,768)2,583,590 - (1,163,065) - - 10,695 - 10,69516,740 7,166,858 3,593,638 417,885 0 10,231,545 2,405,983 6,755,830 1,914,760 209,422 0 7,751,695 (685,286) - 2,971,23211,268,327 - 23,285,74923,971,035 $6,755,830$4,885,992$11,477,749$0$31,037,444$23,285,749 The accompanying notes are an integral part of these financial statements. 37 CITY OF CHANHASSEN, MINNESOTA Statement 5 RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES For The Year Ended December 31, 2008 20082007 Amounts reported for governmental activities in the statement of activities (page 42) are different because: Net changes in fund balances - total governmental funds (statement 4)$7,751,695($685,286) Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlays differ from depreciation in the current period.636,5863,791,798 The net effect of various miscellaneous transactions involving capital assets is to increase (decrease) net assets.(1,029,924)(3,711,619) Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds.197,5292,248,794 The issuance of long-term debt (e.g., bonds, leases) provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net assets. This amount is the net effect of these differences in the treatment of long-term debt and related items.(4,686,959)(1,264,744) Other post employment benefits in the statement of activites does not require the use of current financial resources and, therefore, is not reported as expenditures in governmental funds.(3,803) - Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds.247,532(109,794) Change in net assets of governmental activities (statement 2)$3,112,656$269,149 The accompanying notes are an integral part of these financial statements. 38 CITY OF CHANHASSEN, MINNESOTA Statement 6 STATEMENT OF NET ASSETS PROPRIETARY FUNDS December 31, 2008 Surface Water WaterSewerManagementTotals Assets:20082007 Current assets: Cash and cash equivalents$5,779,360$3,867,067$2,745,562$12,391,989$16,314,367 Accrued interest receivable67,22541,70239,522148,449156,024 Due from other governmental units - - 12,70112,70155,396 Accounts receivable - net460,927467,88196,8581,025,6661,015,919 Special assessments receivable53,45611,065 - 64,52164,376 Connection charges receivable136,44062,146 - 198,586284,820 Prepaid items1,1361,0061982,340971 Water meter inventory26,440 - - 26,44018,475 Total current assets6,524,984 4,450,867 2,894,841 13,870,692 17,910,348 Noncurrent assets: Deferred connection charges - - - - 6,195 Capital assets: Land1,370,624145,200379,3121,895,1361,861,117 Buildings and structures12,445,429 - - 12,445,42912,445,429 Machinery and equipment1,796,317436,8369,0262,242,1792,199,298 Other improvements36,320,65331,110,82320,762,70988,194,18585,456,816 Construction in progress3,416,047650,5861,615,3255,681,9584,002,840 Total capital assets55,349,070 32,343,445 22,766,372 110,458,887 105,965,500 Less: Allowance for depreciation(17,895,500)(15,804,336)(8,802,299)(42,502,135)(39,548,243) Net capital assets37,453,57016,539,10913,964,07367,956,75266,417,257 Total noncurrent assets37,453,57016,539,10913,964,07367,956,75266,423,452 Total assets43,978,55420,989,97616,858,91481,827,44484,333,800 Liabilities: Current liabilities: Accounts payable55,54318,64837,474111,665124,198 Accrued interest payable202,5057,206 - 209,711238,752 Contracts payable90,1508,4251,11499,68991,700 Due to other governmental units168,85316,449 - 185,30228,761 Salaries payable19,68815,1269,37544,18936,929 Compensated absences payable - due within one year2,7592,6489756,3827,065 Bonds payable - due within one year590,000130,000 - 720,0001,500,000 Total current liabilities1,129,498 198,502 48,938 1,376,938 2,027,405 Noncurrent liabilities: Compensated absences payable - due in more than one year 41,68840,01014,73396,43197,032 Bonds payable - due in more than one year11,430,000265,000 - 11,695,00012,415,000 Total noncurrent liabilities11,471,688 305,010 14,733 11,791,431 12,512,032 Total liabilities12,601,186503,51263,67113,168,36914,539,437 Net assets: Invested in capital assets, net of related debt25,433,57016,144,11013,964,07255,541,75252,502,257 Unrestricted5,943,7984,342,3542,831,17113,117,32317,292,106 Total net assets$31,377,368$20,486,464$16,795,243$68,659,075$69,794,363 The accompanying notes are an integral part of these financial statements. 39 CITY OF CHANHASSEN, MINNESOTA Statement 7 STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS PROPRIETARY FUNDS For The Year Ended December 31, 2008 Surface Water WaterSewerManagement Totals 20082007 Operating revenues: Charges for services$2,309,761$2,136,093$469,587$4,915,441$4,906,909 Penalties and other98,61851,1169,731159,465193,066 Total operating revenues2,408,379 2,187,209 479,318 5,074,906 5,099,975 Operating expenses: Personal services489,994330,774217,0981,037,8661,010,288 Materials and supplies223,14632,90520,784276,835273,439 Contractual services: MCES - 1,202,670 - 1,202,6701,380,304 Other412,040450,453215,3611,077,8541,323,836 Repairs and maintenance238,20499,140 - 337,344297,102 Depreciation1,351,325938,476667,9542,957,7552,668,372 Total operating expenses2,714,709 3,054,418 1,121,197 6,890,324 6,953,341 Operating income (loss)(306,330)(867,209)(641,879)(1,815,418)(1,853,366) Nonoperating revenues (expenses): Investment income355,467227,790213,822797,079786,455 Connection charges491,056173,491297,273961,8202,464,513 Intergovernmental - - 36,35036,35045,172 Special assessment revenue67,80725,884 - 93,691136,890 Interest and fiscal charges(492,676)(18,170) - (510,846)(575,514) Gain (loss) on disposal of capital assets(26,754) - - (26,754) - Miscellaneous 5,1774,05113,23622,464127,143 Total nonoperating revenues (expenses)400,077 413,046 560,681 1,373,804 2,984,659 Income before contributions and transfers93,747 (454,163)(81,198)(441,614)1,131,293 Transfer in - 7,37970,04977,4281,318,818 Transfer out (932,955)(426,472)(1,364,012)(2,723,439)(693,317) Capital contributions894,130260,654850,7172,005,5015,191,225 Change in net assets54,922 (612,602)(524,444)(1,082,124)6,948,019 Net assets - January 1, as previously reported31,322,44621,099,06617,372,85169,794,36362,846,344 Prior period adjustment - - (53,164)(53,164) - Net assets - January 1, as restated31,322,44621,099,06617,319,68769,741,19962,846,344 et assets - December 31$31,377,368$20,486,464$16,795,243$68,659,075$69,794,363 N CapitalTransfers - ContributionsNet Amounts reported above$2,005,501($2,646,011) Amounts reported for business-type activities in the statement of activities are different because: Transfer in of capital assets from governmental activities(1,533,388)1,533,388 Amounts reported on the statement of activities$472,113($1,112,623) The accompanying notes are an integral part of these financial statements. 40 CITY OF CHANHASSEN, MINNESOTA STATEMENT OF CASH FLOWSStatement 8 PROPRIETARY FUNDS For The Year Ended December 31, 2008 Surface Water WaterSewerManagementTotals 20082007 Cash flows from operating activities: Receipts from customers and users$2,417,564$2,229,166$461,124$5,107,854$4,943,206 Payment to suppliers(777,077)(1,771,549)(211,403)(2,760,029)(3,293,919) Payment to employees(490,755)(329,818)(211,317)(1,031,890)(996,586) Miscellaneous revenue (expense)5,1774,05113,23622,464127,143 Net cash flows from operating activities1,154,909131,85051,6401,338,399779,844 Cash flows from noncapital financing activities: Transfers in - 7,37970,04977,4281,318,818 Transfers out(932,955)(426,472)(1,364,012)(2,723,439)(693,317) Operating grant - - 36,35036,35045,172 Net cash flows from noncapital financing activities(932,955)(419,093)(1,257,613)(2,609,661)670,673 Cash flows from capital and related financing activities: Acquisition of capital assets(2,155,991)(165,477)(242,210)(2,563,678)(2,124,999) Connection charges542,796214,180297,2731,054,2492,550,357 Special assessment revenue68,51625,030 - 93,546146,538 Principal paid on bonds(1,370,000)(130,000) - (1,500,000)(905,000) Interest and fiscal charges(519,496)(20,391) - (539,887)(589,607) Net cash flows from capital and related financing activities(3,434,175)(76,658)55,063(3,455,770)(922,711) Cash flows from investing activities: Investment income364,387226,043214,224804,654809,896 Net increase (decrease) in cash and cash equivalents(2,847,834)(137,858)(936,686)(3,922,378)1,337,702 Cash and cash equivalents - January 18,627,1944,004,9253,682,24816,314,36714,976,665 Cash and cash equivalents - December 31$5,779,360 $3,867,067 $2,745,562 $12,391,989 $16,314,367 Reconciliation of operating income (loss) to net cash provided (used) by operating activities: Operating income (loss) ($306,330)($867,209)($641,879)($1,815,418)($1,853,366) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Miscellaneous revenue (expense)5,1774,05113,23622,464127,143 Depreciation1,351,325938,476667,9542,957,7552,668,372 Changes in assets and liabilities: Decrease (increase) in receivables9,18541,957(18,194)32,948(156,769) Decrease (increase) in prepaid items(651)(520)(198)(1,369)803 Decrease (increase) in inventory(7,965) - - (7,965)3,372 Increase (decrease) in payables104,16815,09530,721149,984(9,711) Total adjustments1,461,239 999,059 693,519 3,153,817 2,633,210 Net cash provided by operating activities$1,154,909$131,850$51,640$1,338,399$779,844 Noncash investing, capital and financing activities: Water system assets in the amount of $894,130 and $2,275,373 were contributed to the Water Fund in 2008 and 2007, respectively. Sewer system assets in the amount of $260,654 and $1,739,398 were contributed to the Sewer Fund in 2008 and 2007, respectively. Surface water management system assets in the amount of $850,717 and $1,176,454 were contributed to the Surface Water Fund in 2008 and 2007, respectively. The accompanying notes are an integral part of these financial statements. 41 CITY OF CHANHASSEN, MINNESOTA Statement 9 STATEMENT OF NET ASSETS FIDUCIARY FUNDS December 31, 2008 Agency Funds 20082007 Assets: Cash and investments$709,405$808,404 Liabilities: Accounts payable$1,500$2,245 Escrow deposits payable707,905806,159 Total liabilities$709,405$808,404 The accompanying notes are an integral part of these financial statements. 42 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City of Chanhassen was incorporated in 1967 and operates under the State of Minnesota Statutory Plan B form of government. The governing body consists of a five member City council elected by voters of the City. The financial statements of the City of Chanhassen have been prepared in conformity with accounting principles generally accepted in the United States of America as applied to governmental units by the Governmental Accounting Standards Board (GASB). The following is a summary of the significant accounting policies. A. FINANCIAL REPORTING ENTITY In accordance with 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 of Chanhassen, Minnesota (the City) (the primary government) and its component units. The component unit discussed below is included in the City’s reporting entity because of the significance of its operational or financial relationships with the City. COMPONENT UNITS In conformity with accounting principles generally accepted in the United States of America, the financial statements of the component unit have been included in the financial report as a blended component unit. Pursuant to the authorization of Minnesota Statutes Section 469.094, on April 28, 1997 the City of Chanhassen, Minnesota transferred to the Economic Development Authority of the City of Chanhassen all activities, programs, operations, and authority of the existing City of Chanhassen Housing and Redevelopment Authority (HRA). The Economic Development Authority (EDA), an entity legally separate from the City, is governed by a board which is substantially the same as the City Council. The City is in a relationship of financial benefit or burden with the EDA. Separate financial statements for the EDA are not prepared. JOINTLY GOVERNED ORGANIZATIONS Southwest Area Transit Commission. The City, in conjunction with the Cities of Eden Prairie and Chaska, has agreed to establish the Southwest Area Transit Commission (the Commission). The purpose of the Commission is to provide alternative methods of public transit service to the three cities. The Commission’s board is composed of two commissioners from each of the cities. . The City is a member of a joint powers Western Area Fire Training Association (WAFTA) group along with ten other communities. WAFTA operates a fire training facility in western Carver County. The site has been identified by the Minnesota Pollution Control Agency (MPCA) as contaminated, potentially requiring clean-up. The dollar amount of the clean-up cost is not determinable. Additionally, the City of Chanhassen’s liability, if any, is not determinable. 43 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 B.GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS The government-wide financial statements (i.e., the statement of net assets and the statement of changes in net assets) report information on all of the nonfiduciary activities of the primary government and its component units. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. The statement of activities demonstrates the degree to which the direct expenses of a given function or business-type activity are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or business-type activity. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, 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 revenues are reported instead of general revenues. Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from 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 the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue 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 nature (assets equal liabilities) and do not involve measurement of results of operations. Governmental fund financial statements are reported using the current financial resources measurement 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 or soon enough thereafter to pay liabilities of the current period. For this purpose, the government considers all revenues, except reimbursement grants, to be available if they are collected within 60 days of the end of the current fiscal period. Reimbursement grants are considered available if they are collected within one year of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. 44 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Property taxes, special assessments, intergovernmental revenues, charges for services and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of special assessments receivable due within the current 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 government. The government reports the following major governmental funds: General Fund is the government’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. 2006A General Obligation Improvement Bond Fund (366) accounts for the accumulation of resources for payment of the general obligation bonds issued to finance utility improvements in the MUSA area. Public Works Facility(421) accounts for the construction costs of the new public works facility. Revolving Assessment Fund (601). This construction fund accounts for the City’s annual street re- construction program. The individual property 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 years. The government reports the following major proprietary funds: The Water Fund accounts for the water service charges which are used to finance the water system operating expenses. The Sewer Fund accounts for the sewer service charges which are used to finance the sanitary sewer system operating expenses. The Surface Water Management Fund accounts for the surface water charges which are used to finance the surface water system operating expenses. Additionally, the government reports the following fund type: Agency funds account for the assets of various escrow deposits and the Moon Valley Restoration Funds held by the City in a trustee capacity or as an agent. Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in both the government-wide and proprietary fund financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following subsequent private- sector guidance for their business-type activities and enterprise funds, subject to this same limitation. The government has elected not to follow subsequent private-sector guidance. As a general rule the effect of interfund activity 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 45 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 payments in lieu of taxes, are similarly treated when they involve other funds of the City. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. Amounts reported as program revenues include 1) charges to customers or applicants for goods, services, or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the water, sewer, and surface water management enterprise funds are charges to customers for sales and services. Operating expenses for enterprise funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. When both restricted and unrestricted resources are available for an allowable use, it is the government’s policy to use restricted resources first, then unrestricted resources as they are needed. D.BUDGETS Budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America. Annual appropriated budgets are adopted for the General and Special Revenue Funds. Budgeted amounts are reported as originally adopted, or as amended by the City Council. There were no budget amendments during 2008 to the General Fund or the Special Revenue Funds. Budgeted expenditure appropriations lapse at year end. Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of monies are recorded in order to reserve that portion of the appropriation, is not employed by the City because it is at present not considered necessary to assure effective budgetary control or to facilitate effective cash management. E.LEGAL COMPLIANCE - BUDGETS The City follows these procedures in establishing the budgetary data reflected in the financial statements: 1. The City Manager submits to the City Council a proposed operating budget for the fiscal year commencing the following January 1. The operating budget includes proposed expenditures and the means of financing them. 2. Public hearings are conducted to obtain taxpayer comments. 3. The budget is legally enacted through passage of a resolution. 46 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 4. Management may authorize transfer of budgeted amounts between departments within any fund. All budget amendments between funds must be approved by the City Council. The legal level of budgetary control is at the fund level. Budgetary monitoring, by departments or divisions and by category, is required by the City policy. 5. Formal budgetary integration is employed as a management control device during the year for the General Fund and Special Revenue Funds. Formal budgetary integration is not employed for Debt Service Funds because effective budgetary control is alternatively achieved through general obligation bond indenture provisions. Budgetary control for Capital Projects Funds is accomplished through the use of project controls. The Special Revenue Funds expenditures did not exceed budget appropriation. F. CASH AND INVESTMENTS Cash and investment balances from all funds are pooled and invested to the extent available in authorized investments. Investment income is allocated to individual funds on the basis of the fund's equity in the cash and investment pool. The City provides temporary advances to funds that have insufficient cash balances by means of an advance from another fund shown as interfund receivable in the advancing fund, and an interfund payable in the fund with the deficit, until adequate resources are received. Investments are stated at fair value, based upon quoted market prices as of the balance sheet date. For purposes of the statement of cash flows, the Proprietary Funds consider all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. All of the cash and investments allocated to the Proprietary Fund types have original maturities of 90 days or less. Therefore the entire balance in such fund types is considered cash equivalents. G. 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 receivables by the City at that date. Real property taxes are payable (by property owners) on May 15 and October 15 of each calendar year. Personal property taxes are payable by taxpayers on February 28 and June 30 of each year. These taxes are collected by the County and remitted to the City on or before July 15 and December 15 of the same year. Delinquent collections for November and December are received the following January. The City has no ability to enforce payment of property taxes by property owners. The County possesses this authority. GOVERNMENT-WIDE FINANCIAL STATEMENTS The City recognizes property tax revenue in the period for which taxes were levied. Uncollectible property taxes are not material and have not been reported. 47 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 GOVERNMENT FUND FINANCIAL STATEMENTS The City recognizes property tax revenue when it becomes both measurable and available to finance expenditures of the current period. In practice, current and delinquent taxes and State credits received by the City in July, December and January are recognized as revenue for the current year. Taxes collected by the County by December 31 (remitted to the City the following January) and taxes and credits not received at year end are classified as delinquent and due from County taxes receivable. The portion of delinquent taxes not collected by the City in January are fully offset by deferred revenue because they are not available to finance current expenditures. The City's property tax revenue includes payments from the Metropolitan Revenue Distribution (Fiscal 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 various taxing authorities within the defined metropolitan area. The valuation "shared" is a portion of commercial/industrial property valuation growth since 1971. H. SPECIAL ASSESSMENT REVENUE RECOGNITION Special assessments are levied against benefited properties for the cost or a portion of the cost of special assessment improvement projects in accordance with State Statutes. These assessments are collectible by the City over a term of years usually consistent with the term of the related bond issue. Collection of annual installments (including interest) is handled by the County Auditor in the same manner as property taxes. Property owners are allowed to (and often do) prepay future installments without interest or prepayment penalties. Once a special assessment roll is adopted, the amount attributed 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 or 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 expenses 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 seasonal recreational land in which event the 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 assessments are not material and have not been reported. GOVERNMENT FUND FINANCIAL STATEMENTS Revenue from special assessments is recognized by the City when it becomes measurable and available to finance expenditures of the current fiscal period. In practice, current and delinquent special assessments received by the City are recognized as revenue for the current 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 deferred assessments receivable in governmental funds are completely offset by deferred revenues. 48 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 I. INVENTORIES GOVERNMENTAL FUNDS The original cost of materials and supplies has been recorded as expenditures at the time of purchase. These funds do not maintain material amounts of inventories. PROPRIETARY FUNDS Inventories of the Proprietary Funds are stated at cost, which approximates market, using the first-in, first-out (FIFO) method. J. CAPITAL ASSETS Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads, trails, sidewalks, and similar items), are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Capital assets are defined by the government as assets with an initial, individual cost of more than $5,000 (amount not rounded) and an estimated useful life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased 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 general infrastructure assets, the City chose to include all such items regardless of their acquisition date amount. These assets are reported 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. Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business-type activities is included as part of the capitalized value of the assets constructed.For the year ended December 31, 2008, no interest was capitalized in connection with construction in progress. Property, plant and equipment of the government is depreciated using the straight line method over the following estimated useful lives: Buildings and structures 20 – 50 years Machinery and equipment 3 – 30 years Drainage systems 30 years Water and sewer lines 30 years Streets 25 – 50 years Trails 15 years Sidewalks 25 years Other improvements 7 – 40 years 49 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 K. INTERFUND RECEIVABLES/PAYABLES During the course of operations, numerous transactions occur between individual funds for goods provided or services rendered. Short-term interfund loans are classified as “interfund receivables/payables.” All short-term “interfund receivables/payables” at December 31, 2008 are planned to be eliminated in 2009. Long-term interfund loans are classified as “interfund loan receivable/payable.” Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as “internal balances.” Property taxes and special assessment receivables have been reported net of estimated uncollectible accounts (See Note 1 G and H). Because utility bills are considered liens on property, no estimated uncollectible amounts are established. Uncollectible amounts are not material for other receivables and have not been reported. L. COMPENSATED ABSENCES The City compensates 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 incurred in the government-wide and proprietary fund financial statements. A liability for these amounts is reported in governmental funds only if they have matured, for example, as a result of employee resignations and retirements. In accordance with the provisions of Statement of Government Accounting Standards No. 16, Accounting for Compensated Absences, no liability is recorded 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 severance pay. The City’s liability for compensated absences at December 31, 2008 is scheduled below: Vacation$476,517 Severance295,979 Comp time48,252 $820,748 M. LONG-TERM OBLIGATIONS In the government-wide financial statements and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type statement of net assets. Bond premiums and discounts, as well as issuance costs, are immaterial and are expensed in the year of bond issuance. 50 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. N. FUND EQUITY In the fund financial statements, governmental funds report reservations of fund balance for amounts not appropriable for expenditure or legally segregated for a specific future use. Designated fund balances represent tentative plans for future use of financial resources. O. INTERFUND TRANSACTIONS Interfund services provided and used are accounted for as revenues, expenditures 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. Interfund loans are reported as an interfund loan receivable or payable which offsets the movement of cash between funds. Interfund interest paid out of governmental funds is either eliminated against governmental activities investment earnings, (if paid to governmental activities) or reclassified to a transfer out (if paid to business-type activities) on the statement of activities. All other interfund transactions are reported as transfers. P. USE OF ESTIMATES The preparation of financial statements in accordance with generally accepted accounting principles (GAAP) requires management to make estimates that affect amounts reported in the financial statements during the reporting period. Actual results could differ from such estimates. Q. RECLASSIFICATIONS Certain amounts in the prior year have been reclassified to conform with the current year presentation. 51 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 R. 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 ASSETS The governmental fund balance sheet includes a reconciliation between fund balances – total governmental funds and net assets – governmental activities as reported in the government-wide statement of net assets. One element of that reconciliation explains that “long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported in the funds.” The details of this $26,717,358 difference are as follows: Bonds payable$22,510,000 Loan payable3,375,125 Accrued interest payable110,495 Compensated absences717,935 Other post employment benefit payable3,803 Net adjustment to increase fund balances - total governmental funds to arrive at net assets - governmental activities$26,717,358 2.EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES AND THE GOVERNMENT-WIDE STATEMENT OF ACTIVITIES The government fund statement of revenues, expenditures, and changes in fund balances includes a reconciliation between net changes in fund balances – total governmental funds andchanges in net assets of governmental activities as reported in the government-wide statement of activities. One element of that reconciliation explains that “governmental funds report capital outlays as expenditures. 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 $636,586 difference are as follows: Capital outlay/construction$5,607,571 Depreciation expense(4,970,985) Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities$636,586 52 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Another element of that reconciliation states that “the net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins and donations) is to increase (decrease) net assets.” The details of this ($1,029,924) difference are as follows: Donation of capital assets increase net assets in the statement of activities, but do not appear in the governmental funds because they are not financial resources$519,410 Transfer of capital assets to Enterprise Funds.(1,533,388) The statement of activities reports losses arising from the trade-in or disposal of existing assets to acquire new capital assets. Conversely, governmental funds do not report any gain or loss on trade-in of capital assets(15,946) Net adjustment to decrease net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities($1,029,924) Another element of that reconciliation states that “revenues on the statement of activities that do not provide current financial resources are not reported as revenues in the funds.” The details of this $197,529 difference are as follows: General property taxes deferred revenue: At December 31, 2007($152,960) At December 31, 2008222,385 Special assessments deferred revenue: At December 31, 2007(5,163,942) At December 31, 20085,300,427 Other 2007 revenue has been deferred because it was not collected within 60 days from year-end. At December 31, 2007(18,603) At December 31, 200810,222 Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities.$197,529 53 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Another element of that reconciliation states that “the issuance of long-term debt (e.g., bonds, leases) provides current financial resources to governmental funds, while the repayment of the long-term debt consumes the current financial resources of governmental funds.” Neither transaction, however, has any effect on net assets. The details of this ($4,686,959) difference are as follows: Debt issued: Bonds issued($7,550,000) Loan issued($24,839) Principal repayments: General obligation debt960,000 General obligation improvement bonds with pledged special assessments 1,300,000 General obligation tax increment bonds55,000 Public project revenue bonds95,000 Loan279,552 Loan refund198,328 Net adjustment to decrease net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities.($4,686,959) 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 reported as expenditures in governmental funds.” The details of this $247,532 difference are as follows: Compensated absences($69,111) Accrued interest316,643 Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net assets of governmental activities.$247,532 Note 2 DEPOSITS AND INVESTMENTS A. DEPOSITS In accordance with Minnesota Statutes, the City maintains deposits at those depository banks authorized by the City Council, all of which are members of the Federal Reserve System. Custodial Credit Risk: Custodial credit risk is the risk that in the event of a bank failure, the City’s deposits may not be returned to it. Minnesota Statutes require that insurance, surety bonds or collateral protect all City deposits. The market value of collateral pledged must equal 110% of deposits not covered by insurance or bonds. As of December 31, 2008, the bank balance of the City’s 54 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 deposits was covered by federal depository insurance or covered by collateral pledged and held in the City’s name. Minnesota Statutes require that securities pledged as collateral be held in safekeeping by the City Treasurer or in a financial institution other than that furnishing the collateral. Authorized collateral includes the following: a)United States government treasury bills, treasury notes, treasury bonds; b)Issues of United States government agencies and instrumentalities as quoted by a recognized industry quotation service available to the government entity; c)General obligation securities of any state or local government with taxing powers which is rated “A” or better by a national bond rating service, or revenue obligation securities of any state or local government with taxing powers which is rated “AA” or better 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 Home Loan Banks to a municipality accompanied by written evidence that the bank’s public debt is rated “AA” or better by Moody’s Investors Service, Inc. or Standard & Poor’s Corporation; and f)Time deposits that are fully insured by any federal agency. At December 31, 2008 the carrying amount of the City’s deposits with financial institutions was $11,321,504. B. INVESTMENTS Minnesota Statutes authorize the City to invest in the following: a) Direct obligations or obligations guaranteed by the United States or its agencies, its instrumentalities, or organizations created by an act of congress, excluding mortgage-backed securities 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 repurchase or reverse repurchase agreements. c) Obligations of the State of Minnesota or any of its municipalities as follows: 1)any security 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. 55 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 d) Bankers acceptance of United States banks. e) Commercial paper issued by United States corporations or their Canadian subsidiaries, of the highest quality, and maturing in 270 days or less. f) Repurchase or reverse repurchase agreements with banks 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 securities broker-dealers; or, a bank qualified as a depositor. g) General obligation temporary 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, 2008 the City had the following investments and maturities: Investment Maturities (in Years) FairLess Investment TypeRatingValueThan 11-56-10 Fannie Mae Discount NotesAAA$994,400$994,400$ - $ - Freddie Mac Notes (1)AAA2,110,5701,025,5701,085,000 - Federal Farm Credit Bank NotesAAA3,141,754 - 3,141,754 - Federal Home Loan Bank NotesAAA8,841,6351,004,2087,837,427 - Federal Home Loan Mortgage Corp. NotesAAA3,612,936 - 3,612,936 - Federal National Mortgage Assn. NotesAAA8,731,9032,524,6906,207,213 - Municipal bondsAAA184,767 - 184,767 - Money market mutual fundN/A5,199,8895,199,889 - - Total$32,817,854$10,748,757$22,069,097$0 Total investments$32,817,854 (1)These investments have call dates that occur inDeposits11,321,504 less than one year.Petty cash735 Total cash and investments$44,140,093 C. INVESTMENT RISKS The City’s investment policy is to follow Minnesota State Statutes as described above which reduces the City’s exposure to credit, custodial credit, and interest rate risks. Specific risk information for the City is as follows: Interest rate risk – The City’s investment policy requires the City to diversify its investment portfolio to eliminate the risk of loss resulting 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 reasonably anticipated, i.e., not investing in maturities longer than five years. 56 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Credit risk – The City does not have a formal investment policy that further limits the ratings of their investments from those that are authorized by Minnesota Statutes. The City’s external investment pool investment 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 – The City places no limit on the amount the City may invest in any one issuer. More than 5% of the City’s investments are in various holdings as follows: Federal Farm Credit Bank Notes9.6% Federal Home Loan Bank Notes26.9% Federal Home Loan Mortgage Corp. Notes11.0% Federal National Mortgage Assn. Notes26.6% Freddie Mac Notes6.4% Custodial Credit Risk – For investments in securities, custodial credit risk is the risk that in the event of a failure of the counterparty, the City will not be able to recover the value of its investments in securities that are in the possession of an outside party. As of December 31, 2008, all investments of the City were insured, registered and held by the City or its agent in the City’s name. Note 3 RECEIVABLES Significant receivable balances not expected to be collected within one year of December 31, 2008 are as follows: CertifiedDelinquent Special AccountsPropertyAssessment ReceivableTaxesReceivableTotal Major Funds: General$ - $56,782$ - $56,782 2006A G.O. Improvement - - 2,480,7152,480,715 Revolving Assessment Fund - - 1,337,8021,337,802 Water6,159 - 132,066138,225 Sewer - - 46,58646,586 Nonmajor Funds - - 1,190,6991,190,699 $6,159$56,782$5,187,868$5,250,809 57 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Governmental funds report deferred revenue in connection with receivables for revenues that are not considered to be available to liquidate liabilities of the current period. Governmental funds also defer revenue recognition in connection with resources that have been received, but not yet earned. At the end of the current fiscal year, the various components of deferred revenue and unearned revenue reported in the governmental funds were as follows: Major Funds 2006A G.O.Revolving General ImprovementAssessment Nonmajor FundBondsFundFundsTotal Unavailable: Delinquent property taxes receivable$220,565$ - $ - $1,826$222,391 Special assessments not yet due2,5412,503,1261,517,9031,276,8515,300,421 Accounts receivable not received within 60 days10,222 - - - 10,222 Total unavailable revenue233,3282,503,1261,517,9031,278,6775,533,034 Unearned: Grant revenue received but not yet earned - - - 62,68262,682 Antenna rental fees received but not yet earned30,283 - - - 30,283 Total unearned revenue30,2830062,68292,965 Total deferred (unavailable)/unearned revenue for governmental funds$263,611$2,503,126$1,517,903$1,341,359$5,625,999 Note 4 CAPITAL ASSETS Capital asset activity for the year ended December 31, 2008 was as follows: BeginningEnding Primary Government BalanceIncreaseDecreaseBalance Governmental activities: Capital assets - not depreciated: Land$16,296,657$728,100$ - $17,024,757 Construction in progress3,104,9292,491,304(1,276,989)4,319,244 Total capital assets not being depreciated19,401,5863,219,404(1,276,989)21,344,001 Capital assets - being depreciated: Buildings and structures15,203,969 - - 15,203,969 Machinery and equipment6,486,306442,673(123,470)6,805,509 Other improvements 4,502,292635,374 - 5,137,666 Infrastructure102,420,1421,594,631(104,400)103,910,373 Total capital assets being depreciated128,612,7092,672,678(227,870)131,057,517 Less accumulated depreciation for: Buildings and structures3,725,015368,077 - 4,093,092 Machinery and equipment3,883,136425,176(120,805)4,187,507 Other improvements 1,335,385191,247 - 1,526,632 Infrastructure49,960,2143,986,485(69,619)53,877,080 Total accumulated depreciation58,903,7504,970,985(190,424)63,684,311 Governmental activities capital assets - net89,110,545921,097(1,314,435)88,717,207 58 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 BeginningEnding Primary Government BalanceIncreaseDecreaseBalance Business-type activities: Capital assets - not depreciated: Land$1,861,117$34,019$ - $1,895,136 Construction in progress4,002,8403,771,980(2,092,862)5,681,958 Total capital assets not being depreciated5,863,9573,805,999(2,092,862)7,577,094 Capital assets - being depreciated: Buildings and structures12,445,429 - - 12,445,429 Machinery and equipment2,199,29848,032(5,150)2,242,180 Other improvements 85,456,8162,737,368 - 88,194,184 Total capital assets being depreciated100,101,5432,785,400(5,150)102,881,793 Less accumulated depreciation for: Buildings and structures - 249,591 - 249,591 Machinery and equipment937,852130,003(3,863)1,063,992 Other improvements 38,610,3912,578,161 - 41,188,552 Total accumulated depreciation39,548,2432,957,755(3,863)42,502,135 Business-type activities capital assets - net66,417,2573,633,644(2,094,149)67,956,752 Total capital assets - net$155,527,802$4,554,741($3,408,584)$156,673,959 Depreciation expense was charged to functions/programs of the government as follows: Governmental activities: General government$320,529 Public safety173,291 Public works3,407,230 Parks and recreation1,069,935 Total depreciation expense - governmental activities$4,970,985 Business-type activities: Water$1,351,325 Sewer938,476 Storm sewer667,954 Total depreciation expense - business-type activities$2,957,755 59 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Note 5 CITY INDEBTEDNESS The City issues general obligation bonds, to provide funds for the acquisition and construction of major capital facilities. The reporting entity’s long-term debt is segregated between the amounts to be repaid from governmental activities and amounts to be repaid from business-type activities. GOVERNMENTAL ACTIVITIES As of December 31, 2008, the governmental activities long-term debt of the City consisted of the following: FinalAuthorized Issue Maturity Interest AndOutstanding DateDateRateIssued12/31/08 General Long-Term Debt: General Obligation Bonds: G.O. Library Bonds, Series 2002A 3/01/022/01/22 1.55% - 4.85%$6,095,000$4,850,000 G.O. Park Refunding, Series 2005C11/16/052/01/10 3.50%2,590,0001,505,000 G.O. Capital Improvement Plan Bonds, Series 2008A11/18/082/01/304.00% - 4.60%7,550,0007,550,000 Total general obligation bonds16,235,00013,905,000 Revenue Bonds: 2000 Public Project Revenue Bonds12/01/002/01/124.75%-5.35%930,000435,000 Tax Increment Bonds: G.O. Tax Increment Refunding Bonds, Series 2004C8/10/042/01/213.00% - 6.00%1,170,0001,015,000 General Improvement Bonds: G.O. Improvement Bonds, Series 2004A8/10/042/01/152.50% - 4.00%2,070,000985,000 G.O. Improvement Bonds, Series 2006A6/13/062/01/143.75% - 3.80%6,640,0006,170,000 Total improvement bonds8,710,0007,155,000 Other debt: Loan payable to State of MN (G.O. Improvement Bonds, Series 2005A)4/19/057/01/173.81% - 4.30%3,654,6773,375,125 Compensated absences payableN/AN/AN/AN/A717,935 Total City indebtedness - governmental activities$30,699,677$26,603,060 60 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 BUSINESS-TYPE ACTIVITIES As of December 31, 2008, the business-type activities long-term debt of the City consisted of the following: FinalAuthorized Issue Maturity Interest AndOutstanding DateDateRateIssued12/31/08 G.O. Revenue Bonds: Water and Sewer Revenue Bonds of 2001, Series A7-15-012/1/20123.50% - 4.65%$1,645,000$395,000 Water Revenue Bonds of 2004, Series B8-10-042/1/20254.00% - 4.50%7,930,0007,075,000 Water Revenue Bonds of 2005, Series B11-16-052/1/20213.75% - 3.90%5,465,0004,945,000 Total G.O. Revenue Bonds15,040,00012,415,000 Compensated absences payableN/AN/AN/AN/A102,813 Total City indebtedness - Business-type activities$15,040,000$12,517,813 GOVERNMENTAL ACTIVITIES Annual debt service requirements to maturity for the governmental activities long-term debt are as follows: G.O. Improvement BondsG.O. Tax Increment BondsPublic Project Revenue BondsAll Other G.O. BondsLoan Payable Year EndingGovernmental ActivitiesGovernmental ActivitiesGovernmental ActivitiesGovernmental ActivitiesGovernmental Activities December 31PrincipalInterestPrincipalInterestPrincipalInterestPrincipalInterestPrincipalInterest 2009$1,220,000$243,738$55,000$52,979$100,000$20,152$860,000$479,937$318,002$137,406 20101,220,000200,27560,00050,485105,00014,8991,155,000539,151330,945124,462 20111,175,000156,31960,00047,725110,0009,308525,000507,918344,417110,991 20121,220,000111,30065,00044,720120,0003,210540,000486,441358,43796,971 20131,270,00064,11370,00041,345 - - 565,000463,787373,02982,379 20141,025,00020,50070,00037,775 - - 590,000439,683388,21567,192 201525,00050075,00034,005 - - 615,000414,127404,02051,387 2016 - - 80,00029,895 - - 640,000387,254420,47034,938 2017 - - 85,00025,440 - - 675,000358,910437,59017,818 2018 - - 90,00020,580 - - 705,000328,981 - - 2019 - - 95,00015,308 - - 740,000297,344 - - 2020 - - 100,0009,600 - - 780,000263,672 - - 2021 - - 110,0003,300 - - 815,000227,942 - - 2022 - - - - - - 855,000190,104 - - 2023 - - - - - - 405,000162,013 - - 2024 - - - - - - 425,000144,270 - - 2025 - - - - - - 445,000125,454 - - 2026 - - - - - - 465,000105,545 - - 2027 - - - - - - 490,00084,412 - - 2028 - - - - - - 510,00062,035 - - 2029 - - - - - - 540,00038,275 - - 2030 - - - - - - 565,00012,995 - - Total$7,155,000$796,745$1,015,000$413,157$435,000$47,569$13,905,000$6,120,250$3,375,125$723,544 It is not practicable to determine the specific year for payment of long-term accrued compensated absences. The revenue bond issue was sold by the City’s Economic Development Authority (EDA) to fund the construction of a municipal facility. The City makes lease payments to the EDA to fund debt service on these issues. The EDA is a blended component unit of the City of Chanhassen and the bond is reported in the Governmental Activities column on the Statement of Net Assets. 61 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 The City has issued General Improvement Bonds to provide funds for various construction projects. The bonds have interest rates ranging from 2.50% to 4.90% and are payable over the next seven years. In case of a default by property owners, the City can place a lien on the property in order to recover the default. The balance payable at December 31, 2008 is $7,155,000. BUSINESS-TYPE ACTIVITIES Annual debt service requirements to maturity for the business-type long-term debt are as follows: G.O. Revenue Bonds Year EndingBusiness-Type Activities December 31PrincipalInterest 2009$720,000$489,152 2010740,000460,357 2011700,000431,954 2012730,000403,783 2013690,000376,012 2014715,000348,799 2015750,000320,424 2016775,000290,887 2017805,000260,080 2018845,000227,391 2019880,000192,676 2020915,000156,323 2021960,000117,918 2022505,00086,935 2023535,00063,787 2024560,00039,150 2025590,00013,275 Total$12,415,000$4,278,903 It is not practicable to determine the specific year for payment of long-term accrued compensated absences. 62 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 CHANGE IN LONG-TERM LIABILITIES Long-term liability activity for the year ended December 31, 2008, was as follows: BeginningEnding Due Within BalanceAdditionsDeletionsBalanceOne Year Governmental activities: Bonds payable: General obligation$7,315,000$7,550,000$960,000$13,905,000$860,000 G.O. improvement bonds8,455,000 - 1,300,0007,155,0001,220,000 G.O. tax increment bonds1,070,000 - 55,0001,015,00055,000 Public project revenue bonds530,000 - 95,000435,000100,000 Total bonds payable17,370,0007,550,0002,410,00022,510,0002,235,000 Loan payable3,828,16624,839477,8803,375,125318,002 Compensated absences648,824472,271403,160717,93544,570 Total governmental activity long-term liabilities$21,846,990$8,047,110$3,291,040$26,603,060$2,597,572 Business-type activities: G.O. Revenue bonds $13,915,000$ - $1,500,000$12,415,000$720,000 Compensated absences104,09776,17177,455102,8136,382 Total business-type activity long-term liabilities$14,019,097$76,171$1,577,455$12,517,813$726,382 For the governmental activities, loans payable and compensated absences are generally liquidated by the general and special revenue funds. All long-term bonded indebtedness outstanding at December 31, 2008 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, 2008 totaled $7,096. General Obligation Water Revenue Bonds are serviced by the Sewer and Water Enterprise Funds and are carried as debt of that fund. Other bonds are supported by various Debt Service Funds. All bonds are backed by the full faith, credit, and taxing power of the City. 63 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 REVENUE PLEDGED Future revenue pledged for the payment of long-term debt is as follows: Revenue PledgedCurrent Year Percent ofDebt serviceRemainingPrincipalPledged Use ofTotalas a % ofTerm ofPrincipaland InterestRevenue Bond IssueProceedsTypeDebt Servicenet revenuesPledgeand InterestPaidReceived 2004A Improvement bondsInfrastructure improvementsSpecial assessments31%n/a2004 - 2015$1,046,032$407,675$47,533 2006A Improvement bondsInfrastructure improvementsSpecial assessments100%n/a2006 - 2014$6,905,713$712,313$30,044 2004C TIF Refunding bondsDowntown Redevelopment ProjectTax increment100%n/a2004 - 2021$1,428,157$110,546$110,546 State Highway loanHighway 312 improvementsSpecial assessments37.8%n/a2008 - 2017$4,098,669$495,877$55,427 State-aid8.6%n/a2008 - 2017 Storm water charges0.2%n/a2008 - 2017 2001A Sewer Revenue bondsUtility infrastructure improvementsSewer usage charges100%6.9%2001 - 2012$424,919$149,960$2,187,209 2004B Water Revenue bondsUtility infrastructure improvementsWater usage charges100%24.3%2004 - 2025$9,997,925$584,354$2,408,379 2005B Water Revenue bondsUtility infrastructure improvementsWater usage charges100%20.0%2005 - 2021$6,271,059$482,695$2,408,379 Note 6 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 City are partially financed by ad valorem tax levies in addition to special assessments 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 resolution and the County Auditor is notified and instructed to levy these taxes over the appropriate years. The future tax levies are subject to cancellation when and if the City has provided alternative sources of financing. The City Council is required to levy any additional taxes found necessary for full payment of principal and interest. These future scheduled tax levies are not shown as assets in the accompanying financial statements at December 31, 2008. Future scheduled tax levies for all bonds outstanding at December 31, 2008 totaled $22,527,618. 64 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Note 7 PENSION PLANS A. PUBLIC EMPLOYEES RETIREMENT ASSOCIATION (PERA) PLAN DESCRIPTION All full-time and certain part-time employees of the City are covered by defined benefit plans administered by the Public Employees Retirement Association of Minnesota (PERA). PERA administers the Public Employees Retirement Fund (PERF) and the Public Employees Police and Fire Fund (PEPFF) which are cost-sharing, multiple-employer retirement plans. These plans are established and administered in accordance with Minnesota Statute, Chapters 353 and 356. PERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated Plan members are covered by Social Security and Basic Plan members are not. All new members must participate in the Coordinated 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 death of eligible members. Benefits are established by State Statute, and vest after three years of credited service. The defined retirement 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. The benefit provisions stated in the previous paragraphs of this section are current provisions and apply to active plan participants. Vested, terminated employees who are entitled to benefits but are not receiving them yet are bound by the provisions in effect at the time they last terminated their public service. PERA issues a publicly available financial report that includes financial statements and required supplementary information for PERF and PEPFF. That report may be obtained on the internet at www.mnpera.org, by writing to PERA, 60 Empire Drive #200, St. Paul, Minnesota, 55103-2088 or by calling (651)296-7460 or 1-800-652-9026. 65 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 B. FUNDING POLICY Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. These statutes are established and amended by the state legislature. The City makes annual contributions to the pension plans equal to the amount required by state statutes. PERF Basic Plan members and Coordinated Plan members were required to contribute 9.1% and 6.0%, respectively, of their annual covered salary in 2008. PEPFF members were required to contribute 8.6% of their annual covered salary in 2008. That rate will increase to 9.4% in 2009. The City is required to contribute the following percentages of annual covered payroll:11.78% for Basic Plan PERF members, 6.5% for Coordinated Plan PERF members, and 12.9% for PEPFF members. Employer contribution rates for the Coordinated Plan and PEPFF will increase to 6.75% and 14.1% respectively, effective January 1, 2009. The City’s contributions to the Public Employees Retirement Fund for the years ending December 31, 2008, 2007 and 2006 were $278,047, $260,100 and $234,127, respectively. The City’s contributions to the Public Employees Police and Fire Fund for the years ending December 31, 2008, 2007 and 2006 were $15,567, $13,784 and $11,943, respectively. The City’s contributions were equal to the contractually required contributions for each year as set by state statute. C. CHANHASSEN FIRE RELIEF ASSOCIATION PLAN DESCRIPTION The volunteer firefighters of the City of Chanhassen are members of the Chanhassen Fire Department Relief Association. The Chanhassen Fire Department Relief Association is the administrator 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 Board of Trustees within the guidelines of the State of Minnesota statutes. The Relief Association provides retirement and disability benefits to members, and benefits to survivors upon death of eligible members. All benefit provisions and the obligation to make contributions are established and administered in accordance with Minnesota Statutes. The Relief Association issues a publicly available financial report that includes financial statements and required supplementary information. 66 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 FUNDING POLICY Minnesota StatutesChapter 69.772 specifies minimum support rates required on an annual basis. The minimum support rates from the municipality and from State aid are determined as the amount required to meet the normal cost plus amortizing any existing prior 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 Association is comprised of volunteers; therefore, members have no contribution requirements. During the year, the City recognized as revenue and as an expenditure an on-behalf payment of $115,928 made by the State of Minnesota for the Relief Association. The City’s annual pension cost for the current year and related information for the plan is as follows: Annual pension cost$115,928 Contributions made: City$0 State aid$115,928 Actuarial valuation date12/31/08 Actuarial cost methodEntry age normal Amortization methodLevel dollar/Closed Remaining amortization period: Normal cost20 years Prior service cost10 years Asset valuation methodMarket Actuarial assumptions: Investment rate of return5% Projected salary increasesN/A Includes inflation atN/A Cost of living adjustmentsNone THREE YEAR TREND INFORMATION Three-Year Trend Information AnnualPercentageNet YearPensionof APCPension EndingCost (APC)ContributedObligation 12/31/2006$155,540100%$ - 12/31/2007135,949109% - 12/31/2008115,928110% - 67 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 REQUIRED SUPPLEMENTARY INFORMATION Assets in Excess of/Pension ActuarialActuarialActuarial(Unfunded)Benefit ValuationValue ofAccruedAccruedFundedPer Year DateAssetsLiabilityLiabilityRatioof Service 12/31/2006$2,282,438$2,494,740($212,302)91.5%$4,350 12/31/20072,500,0032,619,000(118,997)95.5%4,350 12/31/20081,885,6912,874,758(989,067)65.6%5,050 The Association is comprised of volunteers; therefore, there are no payroll expenditures (i.e., there are no covered payroll amounts or percentage calculations). Note 8 OTHER POST-EMPLOYMENT BENEFITS In 2008, the City prospectively implemented the requirement of a new accounting pronouncement, GASB Statement No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other than Pensions. A.PLAN DESCRIPTION In addition to providing the pension benefits described in Note 7, the City provides post-employment health care benefits (as defined in paragraph B) for retired employees through a single-employer defined benefit plan. The City of Chanhassen, Minnesota 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 benefits, benefit levels, employee contributions and employer contributions are governed by the City and can be amended 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 for the plan. The Plan does not issue a separate report. 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 service with the City through 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. Retirees may obtain dependent coverage while the participating retiree is under age 65. Covered spouses may continue coverage after the retiree’s death. The surviving spouse of an active employee may continue coverage in the group health insurance plan after the employee’s death. 68 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 All health care coverage is provided through the City’s group health insurance plans. The retiree is required to pay 100% of their premium cost for the City-sponsored group health insurance plan in which they participate. The premium is a blended rate determined on the entire active and retiree population. Since the projected claims costs for retirees exceed the blended premium paid by retirees, the retirees are receiving an implicit 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 primary insurer and the City’s plan becomes secondary. C. PARTICIPANTS As of the actuarial valuation dated March 2008, participants consisted of: Retirees and beneficiaries currently purchasing health insurance through the City2 Active employees68 Total70 Participating employers1 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. 69 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 E. ANNUAL OPEB COSTS AND NET OPEB OBLIGATION The City’s annual other post employment benefit (OPEB) cost is calculated based on the annual required contribution (ARC) of the employer, an amount actuarially determined 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, 2008, was calculated as follows: Annual required contribution (ARC)$5,832 Interest on net OPEB obligation - Annual OPEB cost5,832 Contributions made during the year(2,029) Increase (decrease) in net OPEB obligation3,803 Net OPEB obligation - beginning of year - Net OPEB obligation - end of year$3,803 The City first had an actuarial valuation performed for the plan as of January 1, 2008 to determine the funded status of the plan as of that date as well as the employer’s annual required contribution (ARC) for the fiscal year ended December 31, 2008. The City’s annual OPEB cost (expense) of $5,832 was equal to the ARC for the fiscal year, as the transition liability was set at zero as of December 31, 2007. The city’s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan and the net OPEB obligation for 2008 was as follows: Percentage of Fiscal YearAnnual OPEBEmployer Annual OPEB CostNet OPEB EndedCostContributionsContributedObligation December 31, 2008$5,832$2,02934.7%$3,803 70 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 F. FUNDED STATUS AND FUNDING PROGRESS The City currently has no assets that have been irrevocably deposited in a trust for future health benefits, therefore, the actuarial value of assets is zero. The funded status of the plan was as follows: Unfunded ActuarialActuarialUAAL as a ActuarialActuarialAccruedAccruedFundedCoveredPercentage of ValuationValue of AssetsLiability (AAL)*Liability (UAAL)RatioPayrollCovered Payroll Date(a)(b)(b-a)(a/b)(c) ( (b-a) / c) January 1, 2008$ - $52,268$52,2680.0%$4,180,2351.3% *Using the entry age normal actuarial pay cost method. Note, the first OPEB actuarial valuation was conducted as of January 1, 2008. There is no data available prior to the first valuation. G. ACTUARIAL METHODS AND ASSUMPTIONS Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far 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 schedule of funding progress, presented as required supplementary information following the notes to financial statements, presents multi-year trend information that shows whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern 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 volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. In the January 1, 2008 actuarial valuation, the Entry-age Normal Actuarial cost method was used. The actuarial assumptions included a 4.0% investment rate of return (net of administrative expenses) and an initial annual health care cost trend rate of 9% reduced by 1% each year to arrive at an ultimate health care cost trend rate of 5.0%. 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 closed basis. The remaining amortization period at December 31, 2008, was 29 years. 71 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Note 9 DUE TO/FROM OTHER FUNDS AND TRANSFERS Amounts reported as due to/from other funds at December 31, 2008 are as follows: FundReceivablePayable Revolving Assessment Fund$13,409$ - Other governmental funds - 13,409 Total$13,409$13,409 Due to/from other funds are representative of lending/borrowing arrangements to cover deficit cash balances at the end of the fiscal year. The funds will be repaid as tax increments are received. Interfund transfers: TransfersTransfers InOut General Fund$ - ($946,836) Revolving Assessment Fund3,863,624(269,986) Public Works Facility2,550 - Nonmajor Government funds1,363,427(1,366,768) Water Fund - (932,955) Sewer Fund7,379(426,472) Surface Water Management Fund70,049(1,364,012) Total$5,307,029($5,307,029) Interfund transfers allow the City to allocate financial resources to the funds that receive benefit from services provided by another fund. All of the City’s interfund transfers fall under that category. All of the 2008 transfers are considered routine and consistent with previous practices. 72 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Additionally, capital assets contributed to the Enterprise Funds have also been reclassified as transfers on the government-wide statement of activities as follows: Transfers Out Governmental Activities Transfers in (business-type activities): Water Fund$676,609 Sewer Fund169,114 Surface Water Management Fund687,665 Total$1,533,388 Note 10 CONDUIT DEBT From time to time, the City has issued conduit debt to provide financial assistance to private-sector entities for the acquisition and construction of facilities deemed to be in the public interest. The 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, nor any political subdivision thereof is obligated in any manner for the repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the accompanying financial statements. As of December 31, 2008, the outstanding conduit debt is as follows: BondsOriginal12/31/08Maturity Project NameIssuedPrincipalPrincipalDate Building Management Group12/95$1,275,000$745,0002016 Ridgeview Medical Center, Series 2002A10/025,024,0004,698,4132023 Ridgeview Medical Center, Series 2002C10/021,135,600189,1512009 Chapel Hill Academy, Series 2005A12/051,337,7001,115,4622009 St. Hubert Catholic Community, Series 200710/075,942,1405,560,3032027 As of December 31, 2008, there were an additional four conduit debt issues outstanding. The aggregate principal amount for the additional four series issued prior to July 1, 1995 could not be determined; however, their original issue amounts totaled $10,180,000. 73 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Note 11 DEFICIT FUND BALANCES The City has a deficit fund balance in the following fund at December 31, 2008: Capital Project Fund: TID #5 North Bay$13,409 This deficit will be eliminated through tax increment collections. Note 12 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; errors and omissions; injuries to employees; and natural disasters. The City continues to carry commercial insurance for risks of loss, including workers compensation, property and 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 coverage for any of the past three fiscal years. B. LITIGATION The City attorney has indicated that any existing and pending lawsuits, claims and other actions in which the City is a defendant are either covered by insurance; of an immaterial amount; or, in the judgment of the City attorney, remotely recoverable by plaintiffs. C. FEDERAL AND STATE FUNDS The City receives financial assistance from federal and state governmental agencies in the form of grants. The disbursement of funds received under these programs generally requires compliance with the terms and conditions specified in the grant agreements and is subject to audit by the grantor agencies. Any disallowed claims resulting from such audits could become a liability of the applicable fund. 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, 2008. D. TAX INCREMENT DISTRICTS The City’s tax increment districts are subject to review by the State of Minnesota Office of the State Auditor (OSA). Any disallowed claims or misuse of tax increments could become a liability of the applicable fund. Management has indicated that they are not aware of any instances of noncompliance which would have a material effect on the financial statements. 74 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 The City has issued several tax increment pay-as-you-go revenue notes. These notes are not a general obligation of the City and are payable solely from tax increments. Accordingly, these notes are not reflected in the financial statements of the City. Details of the pay-as-you-go revenue notes are as follows: – issued in 2006 in the principal Taxable Tax Increment Revenue Note, Series 2006A (Gateway Place) sum of $300,000 with an interest rate of 9% per annum. Semi-annual principal payments 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% of the tax increment that is received by the City in the six month period immediately before each payment date through February 1, 2014 and 65% from August 1, 2015 through February 1, 2016. The City shall have no obligation to pay unpaid balance that may remain after the final payment on February 1, 2016. At December 31, 2008 the principal amount outstanding on the note was $300,000. Taxable Tax Increment Revenue Note, Series 2003A (Presbyterian Homes) – issued in 2003 in the principal sum of $1,060,000 with an interest rate of 9% per annum. Semi-annual principal payments shall be paid commencing August 1, 2006 and continuing through February 1, 2014. Payments are payable solely from available tax increment, which term means 90% of the tax increment that is received by the City in the six month period immediately before each payment date through February 1, 2012 and 50% from August 1, 2012 through February 1, 2014. The City shall have no obligation to pay unpaid balance that may remain after the final payment on February 1, 2014. At December 31, 2008 the principal amount outstanding on the note was $658,322. Limited Revenue Tax Increment Note (North Bay) – issued in 1999 in the principal sum of $400,000, plus interest on the unpaid principal at the rate of 9% per annum. Payments are payable solely from available tax increment, which term means any tax increment generated by the minimum improvements in the years 1999 through 2013, and received during the six month period preceding a payment date, after first deducting therefrom. $37,200 is to be retained by the City on each payment date from August 1, 1999 through February 1, 2008 for special assessments. If there is insufficient tax increment to meet the obligation regarding the special assessments, such deficiency shall be deferred and shall be paid, with interest at the rate of 9% per annum, until such deficiency is eliminated. The City shall have no obligation to pay unpaid balance of principal or accrued interest that may remain after the final payment on February 1, 2014. E. COMMITTED CONTRACTS At December 31, 2008, the City had commitments of $384,674 for uncompleted construction contracts. 75 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Note 13 DESIGNATIONS AND RESERVATIONS OF FUND EQUITY At December 31, 2008 the City had designated and reserved portions of its various fund equities through legal restriction and City Council authorization. Major fund equity appropriations at December 31, 2008 are shown on the various balance sheets as segregations of the fund equity. A summary of such designations is as follows: General Fund: Designated for cash flow$3,586,750 Reserved for prepaid items21,173 Total General Fund3,607,923 2006A G.O. Improvement Bonds: Reserved for debt service3,036,154 Public Works Facility: Designated for capital improvements6,755,830 Revolving Assessment Fund: Designated for capital improvements4,885,992 Other governmental funds: Reserved for prepaid items25 Reserved for future programs29,499 Reserved for debt service3,605,593 Designated for cable equipment525,692 Designated for capital improvements7,090,803 Total other governmental funds11,251,612 Total reservations and designations of fund balance$29,537,511 76 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Note 14 LEASE REVENUE The City receives revenue from agreements for the lease of space above its water towers and on City property to communication companies. The space is used for antennas and other equipment necessary to provide radio communications. For accounting purposes, the leases are considered operating leases. Lease revenue for the year ended December 31, 2008 totaled $135,906. Terms of each lease are as follows: LesseeTermsCurrent Term Sprint$21,006 per year with 3% annual increases8/1/06 - 7/31/11 Sprint$19,669 per year with 3% annual increases12/1/05 - 11/30/10 Verizon$1,587 per month through April 2012; $1,825 per month thereafter5/1/07 - 4/30/17 Nextel West Corp.$1,587 per month12/1/07 - 11/30/12 T-Mobile$1,750 per month with 3% annual increases11/1/05 - 10/31/10 T-Mobile$1,803 per month with 3% annual increases11/1/06 - 10/31/11 StoneBridge Wireless5% of gross revenues associated with equipment used on property4/1/06 - 12/31/09 Cingular/AT&T$1,700 per month with 3% annual increases8/1/07 - 7/31/12 Note 15 RECENTLY ISSUED ACCOUNTING STANDARDS The Governmental Accounting Standards Boards (GASB) recently approved the following statements which were not implemented for these financial statements: Statement No. 51 Accounting and Financial Reporting for Intangible Assets. The provisions of this Statement are effective for financial statements for periods beginning after June 15, 2009. Statement No. 53 Accounting and Financial Reporting for Derivative Investments. The provisions of this Statement are effective for financial statements for periods beginning after June 15, 2009. Statement No. 54 Fund Balance Reporting and Governmental Fund Type Definitions.The provisions of this Statement are effective for financial statements for periods beginning after June 15, 2010. The effect these standards may have on future financial statements is not determinable at this time. Note 16 SUBSEQUENT EVENT On May 11, 2009, the City Council adopted Resolution 2009-40 providing for the issuance of $6,020,000 G.O. Improvement Refunding Bonds, Series 2009A. 77 CITY OF CHANHASSEN, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2008 Note 17 PRIOR PERIOD ADJUSTMENT During 2008, adjustments to prior year financial statements were made for capital assets. A summary of these changes are as follows: SurfaceBusiness- WaterType ManagementActivities Net assets - December 31, 2007, as previously reported$17,372,851$69,794,363 Prior period adjustment: Capital assets(53,164)(53,164) Net assets - January 1, 2008, as restated$17,319,687$69,741,199 78 REQUIRED SUPPLEMENTARY INFORMATION 79 CITY OF CHANHASSEN, MINNESOTA Statement 10 REQUIRED SUPPLEMENTARY INFORMATION Page 1 of 6 BUDGETARY COMPARISON SCHEDULE - GENERAL FUND For The Year Ended December 31, 2008 WithComparativeActualAmountsForTheYearEndedDecember312007, WithComparativeActualAmountsForTheYearEndedDecember312007 20082007 Budgeted AmountsActualVariance withActual OriginalFinalAmountsFinal BudgetAmounts Revenues: General property taxes: CCurrent$6513900$6,513,900$6,513,900$6,489,049($24,851)$6,284,318$6513900$6489049($24851)$6284318 Delinquent50,00050,00092,21942,219101,113 Total general property taxes6,563,9006,563,9006,581,26817,3686,385,431 Licenses and permits: Licenses - general government3,5003,5003,000(500)5,100 Licenses - public safety104,500104,500110,2665,766126,899 Permits - public safety1,285,3001,285,3001,224,546(60,754)1,506,836 Permits - -publicworks37000,37000,32416,(4584),27471, Permitspublicworks370003700032416(4584)27471 Permits - community development7,5007,5007,7752758,900 Total licenses and permits1,437,8001,437,8001,378,003(59,797)1,675,206 Intergovernmental: State: Market value homestead credit - - 79,89279,892162,052 PERA - public safety20,00020,00019,467(533)19,467 State aid - fire - public safety120,000120,000115,928(4,072)135,949 py() Other - general government - - 975975245 State aid - police - public safety85,00085,00086,6851,68585,970 Total intergovernmental225,000225,000302,94777,947403,683 Charges for services: General government99,50099,50079,136(20,364)79,816 Public safety5,0005,0004,610(390)3,137 Public works88,00088,00048,822(39,178)29,712 Parkandrecreationar an recreaon379100,379100,419515,40415,369636, Pkdti37910037910041951540415369636 Community development49,50049,50040,514(8,986)29,056 Total charges for services621,100621,100592,597(28,503)511,357 Fines and forfeits: Public safety157,500157,500124,633(32,867)145,682 Miscellaneous: Investment income125,000125,000216,28391,283250,462 Contributions and donations Contributionsanddonations General government500500600100600 Public safety2,5002,5003,1006003,100 Park and recreation17,00017,00026,9509,95019,061 Other: General government135,750135,750163,23627,486163,373 Public safety13,80013,80025,98512,185165,011 Public works12,65012,6503,097(9,553)5,081 PkdtiPark and recreation57005,7005,70013,6617,96111,489570013661796111489 Community development1001001,1931,093142 Total miscellaneous313,000313,000454,105141,105618,319 Total revenues9,318,3009,318,3009,433,553115,2539,739,678 80 CITY OF CHANHASSEN, MINNESOTA Statement 10 REQUIRED SUPPLEMENTARY INFORMATION Page 2 of 6 BUDGETARY COMPARISON SCHEDULE - GENERAL FUND For The Year Ended December 31, 2008 WithComparativeActualAmountsForTheYearEndedDecember312007, WithComparativeActualAmountsForTheYearEndedDecember312007 20082007 Budgeted AmountsActualVariance withActual OriginalFinalAmountsFinal BudgetAmounts Expenditures: Generalgovernment: Generalgovernment: Legislative: Current: Personal services$34,200$34,200$30,799$3,401$32,806 Contractual services100,700100,70071,00229,698107,893 Total legislative 134,900134,900101,80133,099140,699 Administrative office: Current: Personal services374,500374,500370,0494,451364,520 Materials and supplies500500124376316 Contractual services59,90059,90072,131(12,231)73,662 Total administrative office434,900434,900442,304(7,404)438,498 Finance: Current: Personal services210,600210,600213,067(2,467)229,128 Materialsandsuppliesaeras an suppes500500 -50051 Mtildli50050050051 Contractual services91,50091,50049,13142,36945,837 Total finance302,600302,600262,19840,402275,016 Election: Current: Personal services21,50021,50027,853(6,353)13 Materials and supplies200200545(345) - Contractual services6,2006,2006,388(188) - Contractualservices6,2006,2006,388(188) Total election27,90027,90034,786(6,886)13 Legal: Current: Contractual services168,000168,000131,78936,211142,106 Property assessment: Current: Contractual services101,600101,600105,351(3,751)101,496 MISM.I.S.: Current: Personal services163,600163,600166,921(3,321)159,692 Materials and supplies2,4002,4002,594(194)5,874 Contractual services119,300119,30087,76931,531118,830 Total M.I.S.285,300285,300257,28428,016284,396 City hall: Current: Current: Personal services68,40068,40070,416(2,016)69,003 Materials and supplies42,30042,30045,220(2,920)46,822 Contractual services282,100282,100299,164(17,064)284,694 Total City hall392,800392,800414,800(22,000)400,519 81 CITY OF CHANHASSEN, MINNESOTA Statement 10 REQUIRED SUPPLEMENTARY INFORMATION Page 3 of 6 BUDGETARY COMPARISON SCHEDULE - GENERAL FUND For The Year Ended December 31, 2008 WithComparativeActualAmountsForTheYearEndedDecember312007, WithComparativeActualAmountsForTheYearEndedDecember312007 20082007 Budgeted AmountsActualVariance withActual OriginalFinalAmountsFinal BudgetAmounts Expenditures: (continued) Generalgovernment:(continued) Generalgovernment:(continued) Library: Current: Materials and supplies$3,000$3,000$2,187$813$2,463 Contractual services107,200107,200128,842(21,642)124,873 Total library110,200110,200131,029(20,829)127,336 Total general government1,958,2001,958,2001,881,34276,8581,910,079 gg Public safety: Police: Current: Personal services75,10075,10075,461(361)73,543 Materials and supplies5,0005,0004,2627385,098 Contractual services1,422,0001,422,0001,421,7962041,275,967 Totalpoliceoa poce1502100,,1502100,,1501519,,5811354608,, Ttlli1502100150210015015195811354608 Fire department: Current: Personal services510,600510,600461,03649,564496,664 Materials and supplies47,00047,00046,31768348,753 Contractual services116,000116,000102,03013,97090,094 Total fire department673,600673,600609,38364,217635,511 Code enforcement: Codeenforcement: Current: Personal services658,800658,800635,80023,000628,834 Materials and supplies8,7008,7006,2192,4814,741 Contractual services23,40023,40012,62410,77613,027 Total code enforcement690,900690,900654,64336,257646,602 Animal control: Current: PliPersonal services5530055,30055,30051,5963,70453,5235530051596370453523 Materials and supplies4,0004,0004,557(557)4,833 Contractual services13,70013,70013,58111915,776 Total animal control73,00073,00069,7343,26674,132 Total public safety2,939,6002,939,6002,835,279104,3212,710,853 Publicworks: Publicworks: Engineering: Current: Personal services506,500506,500499,8416,659517,002 Materials and supplies9009002,034(1,134)1,060 Contractual services30,20030,20030,333(133)30,010 Total engineering537,600537,600532,2085,392548,072 82 CITY OF CHANHASSEN, MINNESOTA Statement 10 REQUIRED SUPPLEMENTARY INFORMATION Page 4 of 6 BUDGETARY COMPARISON SCHEDULE - GENERAL FUND For The Year Ended December 31, 2008 WithComparativeActualAmountsForTheYearEndedDecember312007, WithComparativeActualAmountsForTheYearEndedDecember312007 20082007 Budgeted AmountsActualVariance withActual Expenditures: (continued)OriginalFinalAmountsFinal BudgetAmounts Public works: (continued) Streetmaintenance: Streetmaintenance: Current: Personal services$599,700$599,700$622,738($23,038)$595,930 Materials and supplies133,500133,500160,256(26,756)110,938 Contractual services34,30034,30020,91713,38330,184 Total street maintenance 767,500767,500803,911(36,411)737,052 Street lighting: Current: Materials and supplies4,5004,5002,8911,6093,009 Contractual services315,400315,400316,039(639)287,685 Total street lighting319,900319,900318,930970290,694 City garage: Current: Personal services241,700241,700247,571(5,871)235,717 Materials and supplies156,400156,400162,450(6,050)140,199 Contractualservicesonracua servces46500,46500,43652,2848,46435, Cttli465004650043652284846435 Total City garage444,600444,600453,673(9,073)422,351 Total public works2,069,6002,069,6002,108,722(39,122)1,998,169 Parks and recreation: Parks and recreation commission: Current: Current: Materials and supplies200200 - 200 - Contractual services2,0002,0001,0949061,767 Total parks and recreation commission2,2002,2001,0941,1061,767 Parks and recreation administration: Current: Personal services118,500118,500121,392(2,892)117,143 Materials and supplies1,0001,00075925452 CttliContractual services96009,6009,6007,1172,4837,9469600711724837946 Total parks and recreation administration129,100129,100128,584516125,541 Recreation center: Current: Personal services212,700212,700232,440(19,740)205,990 Materials and supplies11,50011,50046,807(35,307)7,256 Contractual services77,00077,00096,905(19,905)35,658 Totalrecreationcenter301,200,301,200,376,152,(74,952),248,904, Totalrecreationcenter301200301200376152(74952)248904 Senior citizen center: Current: Personal services36,90036,90041,089(4,189)31,542 Materials and supplies4,3004,3002,6091,6914,962 Contractual services19,50019,50023,467(3,967)17,446 Total senior citizen center60,70060,70067,165(6,465)53,950 83 CITY OF CHANHASSEN, MINNESOTA Statement 10 REQUIRED SUPPLEMENTARY INFORMATION Page 5 of 6 BUDGETARY COMPARISON SCHEDULE - GENERAL FUND For The Year Ended December 31, 2008 WithComparativeActualAmountsForTheYearEndedDecember312007, WithComparativeActualAmountsForTheYearEndedDecember312007 20082007 Budgeted AmountsActualVariance withActual OriginalFinalAmountsFinal BudgetAmounts Expenditures:(continued) Expenditures:(continued) Parks and recreation: (continued) Recreation program: Current: Personal services$165,800$165,800$175,780($9,980)$159,507 Materials and supplies17,10017,10021,488(4,388)16,992 Contractual services93,50093,50089,6413,85983,466 Total recreation program276,400276,400286,909(10,509)259,965 pg() Self-supporting programs: Current: Personal services26,90026,90030,762(3,862)29,790 Materials and supplies5,2005,2008,727(3,527)6,537 Contractual services68,00068,00044,90223,09891,833 Total self-supporting programs100,100100,10084,39115,709128,160 Lake Ann Park Operations: Current:urren: Ct Personal services13,80013,8006,5967,2047,733 Materials and supplies9,1009,1007,9271,17312,881 Contractual services51,40051,40042,4468,95441,784 Total Lake Ann Park operations74,30074,30056,96917,33162,398 Park maintenance: Current: Personal services661,300661,300679,204(17,904)676,612 Personalservices661,300661,300679,204(17,904)676,612 Materials and supplies81,30081,30074,4166,88488,776 Contractual services92,20092,20089,3492,85188,447 Total park maintenance834,800834,800842,969(8,169)853,835 Downtown maintenance: Current: Materials and supplies - - 8(8)423 Contractual services - - 6,205(6,205)7,148 TtldtitTotal downtown maintenance00006,213(6,213)7,5716213(6213)7571 Total parks and recreation1,778,8001,778,8001,850,446(71,646)1,742,091 Community development: Planning commission: Current Materialsandsupplies200200-200- Materialsandsupplies200200-200- Contractual services4,0004,0003,0049965,024 Total planning commission4,2004,2003,0041,1965,024 84 CITY OF CHANHASSEN, MINNESOTA Statement 10 REQUIRED SUPPLEMENTARY INFORMATION Page 6 of 6 BUDGETARY COMPARISON SCHEDULE - GENERAL FUND For The Year Ended December 31, 2008 WithComparativeActualAmountsForTheYearEndedDecember312007, WithComparativeActualAmountsForTheYearEndedDecember312007 20082007 Budgeted AmountsActualVariance withActual OriginalFinalAmountsFinal BudgetAmounts Expenditures:(continued) Expenditures:(continued) Community development: (continued) Planning administration: Current Personal services$367,800$367,800$373,488($5,688)$357,475 Materials and supplies700700241459381 Contractual services14,10014,10014,0762442,023 Total planning administration382,600382,600387,805(5,205)399,879 pg() Senior facility commission: Current Personal services20,10020,10020,937(837)19,784 Materials and supplies - - 2,100(2,100) - Contractual services15,20015,2006,6498,5519,063 Total senior facility commission35,30035,30029,6865,61428,847 Totalcommunitydevelopmentoa communyeveopmen422100,422100,420495,1605,433750, Ttlitdlt4221004221004204951605433750 Total expenditures9,168,3009,168,3009,096,28472,0168,794,942 Revenues over expenditures150,000150,000337,269187,269944,736 Other financing sources (uses): Transfers out(150,000)(150,000)(946,836)(796,836)(273,720) Transfersout(150,000)(150,000)(946,836)(796,836)(273,720) Net change in fund balance$0$0(609,567)($609,567)671,016 Fund balance - January 15,491,2864,820,270 Fund balance - December 31$4,881,719$5,491,286 85 CITY OF CHANHASSEN, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE NOTE TO RSI December 31, 2008 Note A BUDGETARY INFORMATION The General Fund budget is legally adopted on a basis consistent with accounting principles generally accepted in the United States of America. The legal level of budgetary control is at the department level for the General Fund. 86 COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES 87 NONMAJOR GOVERNMENTAL FUNDS 88 SPECIAL REVENUE FUNDS A Special Revenue Fund is used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. 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 resources to be used for the acquisition or construction of major capital facilities (other than those financed by Proprietary Funds). 89 CITY OF CHANHASSEN, MINNESOTA Statement 11 COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS December 31, 2008 With Comparative Totals For December 31, 2007 Totals Nonmajor SpecialDebtCapital Governmental Funds RevenueServiceProject20082007 Assets: Cash and investments$366,360$3,802,163$7,034,937$11,203,460$11,874,673 Accrued interest receivable4,22025,65569,36199,236121,699 Due from other governmental units - - - - 309,143 Accounts receivable - net188,527 - 113,570302,097305,804 Property taxes receivable - 15,49611,48526,98126,915 Special assessments receivable - 1,237,67739,3281,277,0051,403,164 Prepaid items25 - - 25 - Total assets$559,132$5,080,991$7,268,681$12,908,804$14,041,398 Liabilities and Fund Balance Liabilities: Accounts payable$ - $ - $60,447$60,447$324,234 Duetootherfunds - - --13409,13409,234177, Duetootherfunds1340913409234177 Contracts payable - - 11,92411,924117,545 Due to other governmental units - - - - 401,235 Salaries payable3,916 - - 3,9163,061 Deferred revenue - 1,237,677103,6821,341,3591,692,819 Total liabilities3,9161,237,677189,4621,431,0552,773,071 Fund balance: Reserved 29,5243,605,593 - 3,635,1173,780,321 Unreserved: Designated525,692 - 7,090,8037,616,4957,512,142 Undesignated - 237,721(11,584)226,137(24,136) Total fund balance555,2163,843,3147,079,21911,477,74911,268,327 Total liabilities and fund balance$559,132$5,080,991$7,268,681$12,908,804$14,041,398 90 CITY OF CHANHASSEN, MINNESOTA Statement 12 COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS For The Year Ended December 31, 2008 With Comparative Totals For The Year Ended December 31, 2007 Totals Nonmajor Special DebtCapitalGovernmental Funds RevenueServiceProject20082007 Revenues: General property taxes$ - $1,809,190$1,091,875$2,901,065$3,017,678 Tax increment collections - - 476,651476,651420,526 Licenses and permits - - 432,542432,542496,352 Intergovernmental - - 1,545,0231,545,023494,351 Special assessments - 112,87923,467136,346519,263 Charges for services185,5666,20256,844248,612227,312 Investment income22,794133,180366,480522,454669,390 Contributions and donations10,260 - 2,50012,76024,667 Other - - 22,10522,10543,730 Total revenues218,620 2,061,451 4,017,487 6,297,558 5,913,269 Expenditures: Current: General government87,827 - 133,343221,170206,849 Public safety17,500 - 32,51750,017213,898 Public works - - 643,502643,502462,971 ,,, Parks and recreation - - 82,90782,907106,789 Community development - - 48,32448,324407,556 Capital outlay: General government141,248 - 92,352233,6006,734 Public safety - - 54,28454,284505,215 Public works - - 1,451,5671,451,567982,494 Parks and recreation - - 642,508642,5081,070,648 Debt service: Principal - 2,219,552 - 2,219,5521,750,000 Interest and paying agent fees - 632,535 - 632,535484,664 Developer assistance - - 226,055226,055206,753 Total expenditures246,575 2,852,087 3,407,359 6,506,021 6,404,571 Revenues over (under) expenditures(27,955)(790,636)610,128 (208,463)(491,302) Other financing sources (uses): Bonds issued - 385,692 - 385,692 - Loans issued - - 24,83924,839 - Transfers in - 380,532982,8951,363,4271,263,479 Transfers out - (93,160)(1,273,608)(1,366,768)(2,363,588) Sale of capital assets - - 10,69510,69516,740 Total other financing sources (uses)0 673,064 (255,179)417,885 (1,083,369) Net change in fund balance(27,955)(117,572)354,949 209,422 (1,574,671) Fund balance - January 1583,1713,960,8866,724,27011,268,32712,842,998 Fund balance - December 31$555,216$3,843,314$7,079,219$11,477,749$11,268,327 91 - This page intentionally left blank - 92 NONMAJOR SPECIAL REVENUE FUNDS Special Revenue Funds are established to account for taxes and other revenues set aside for a particular purpose. Revenues are recognized in the accounting period in which they become available and measurable. Expenditures are recognized in the accounting period in which the related liability is incurred. Contribution Fund – This fund accounts for the proceeds that the City receives from charitable gambling. The City collects 10% of the net proceeds from a pull-tab operation in the City. By state statute, the fund may only be used for public safety equipment and training or programs which benefit youth. CATV Fund – Under the terms of the franchise agreement with Triax Cablevision, the City is to receive 5% of the revenues derived from cable television sales within the City. These monies are dedicated solely to improving public broadcasting capabilities, studio improvements, and other capital expenditures improving the overall cable system. 93 CITY OF CHANHASSEN, MINNESOTA Statement 13 SUBCOMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS December 31, 2008 With Comparative Totals For December 31, 2007 201 Contribution210 CATV Total Nonmajor Special Revenue FundFundFunds 20082007 Assets: Cash and investments$26,158$340,202$366,360$398,972 Accrued interest receivable3803,8404,2204,298 Accounts receivable - net2,961185,566188,527184,709 Prepaid items -2525 - Total assets$29,499 $529,633 $559,132 $587,979 Liabilities and Fund Balance Liabilities: Accounts payable$ - $ - $ - $805 Due to other governmental units - - - 942 Salaries payable -3,9163,9163,061 Total liabilities03,9163,9164,808 Fund balance: Reserved for prepayments -2525 - Reserved for youth and public safety programs29,499 - 29,49934,733 Unreserved: Designated for cable equipment - 525,692525,692548,438 Total fund balance29,499525,717555,216583,171 Total liabilities and fund balance$29,499 $529,633 $559,132 $587,979 94 CITY OF CHANHASSEN, MINNESOTA Statement 14 SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS For The Year Ended December 31, 2008 With Comparative Totals For The Year Ended December 31, 2007 201 Contribution210 CATV Total Nonmajor Special Revenue FundFund Funds Revenues:20082007 Franchise fees$ - $185,566$185,566$183,542 Investment income2,00620,78822,79424,262 Contributions and donations10,260 - 10,26012,167 Total revenues12,266206,354218,620219,971 Expenditures: Current: Personal services -83,78383,78380,968 Materials and supplies -7407404,959 Contractual services17,5003,30420,80419,780 Capital outlay - 141,248141,248 - Total expenditures17,500229,075246,575105,707 Revenues over (under) expenditures(5,234)(22,721)(27,955)114,264 Other financing sources (uses): Transfers out - - - (26,026) Net change in fund balance(5,234)(22,721)(27,955)88,238 Fund balance - January 134,733548,438583,171494,933 Fund balance - December 31$29,499$525,717$555,216$583,171 95 - This page intentionally left blank - 96 NONMAJOR DEBT SERVICE FUNDS Debt Service Funds are maintained on the modified accrual basis of accounting for revenues from taxes and other sources set aside for the payment of the debt obligations of the City. Principal and interest on the general long-term debt is recognized when due. General Obligation Bonds – these funds are used to account for the accumulation 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 general 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. Revenue Bonds – these funds are used to account for the bonds issued by the EDA that are repaid through a lease-purchase agreement with the City. 97 CITY OF CHANHASSEN, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR DEBT SERVICE FUNDS December 31, 2008 WithComparativeTotalsForDecember312007, WithComparativeTotalsForDecember312007 351 1999A 354 2001B G.O.352 2000 G.O. 300PermanentImprovementPublicProjectImprovement 300PermanentImprovementPublicProjectImprovement Revolving DebtBondsRevenue BondsBonds Assets: Cash and investments$235,475$160,043$119,736$15,533 Accrued interest receivable2,2461,901561476 Property taxes receivable - - 1,085 - Special assessments receivable102,093 - - 6,239 p Total assets$339,814$161,944$121,382$22,248 Liabilities and Fund Balance Liabilities: Deferred revenue$102,093$ - $ - $6,239 Fund balance (deficit): Reserved for debt retirement - 161,944121,38216,009 Unreserved: Undesignated237,721 - - - Total fund balance (deficit)237,721161,944121,38216,009 Total liabilities and fund balance$339,,814$161,,944$121,,382$22,,248 Totalliabilitiesandfundbalance$339814$161944$121382$22248 98 Statement 15 358 2003A 364 2005A 365 2005C 367 2008A 357 2002A G.O.G.O.G.O. Park G.O. Public G.O.Library..Equipment3602004AImprovementRefundingWorksTotalsNonmajorDebtService GOLibraryEquipment3602004AImprovementRefundingWorksTotalsNonmajorDebtService BondsCertificateG.O. BondsBondsBondsFacility BondsFunds 20082007 $761,020$25,399$598,701$666,714$830,528$389,014$3,802,163$3,893,506 5,052 - 3,7177,3553,73461325,65531,595 4,0651,2243,0712,5233,528 - 15,49617,338 - - 165,316964,029 - - 1,237,6771,343,954 $770,137$26,623$770,805$1,640,621$837,790$389,627$5,080,991$5,286,393 $ - $ - $165,316$964,029$ - $ - $1,237,677$1,325,507 770,13726,623605,489676,592837,790389,6273,605,5933,745,588 - - - - - - 237,721215,298 770,13726,623605,489676,592837,790389,6273,843,3143,960,886 $770,,137$26,,623$770,,805$1,,640,,621$837,,790$389,,627$5,,080,,991$5,,286,,393 $770137$26623$770805$1640621$837790$389627$5080991$5286393 99 CITY OF CHANHASSEN, MINNESOTA SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR DEBT SERVICE FUNDS ForTheYearEndedDecember312008, ForTheYearEndedDecember312008 With Comparative Totals For The Year Ended December 31, 2007 351 1999A 352 2000 354 2001B 300 Permanent G.O.Public Project G.O. RevolvingImprovementRevenueImprovement DebtBondsBondsBonds DebtBondsBondsBonds Revenues: General property taxes$ - $ - $122,703$ - Special assessments3,674 - - 7,237 Charges for services6,202 - - - Investment income12,5474,7003,121598 Total revenues22,4234,700125,8247,835 Expenditures: Current: General government: Contractual services - - - - Debt service: Principal - 220,00095,000240,000 Interestandpayingagentfeesneres an payng agenees -3600,25556,5240, Ittditf3600255565240 Total expenditures0223,600120,556245,240 Revenues over (under) expenditures22,423(218,900)5,268(237,405) Other financing sources (uses): Bond proceeds - - - - Transfer in - - - - Transferin Transfer out - - - - Total other financing sources (uses)0000 Net change in fund balance22,423(218,900)5,268(237,405) Fund balance - January 1215,298380,844116,114253,414 FdblDb31Fund balance - December 31$237721$237,721$161,944$121,382$16,009$161944$121382$16009 100 Statement 16 367 2008A 358 2003A 362 2004C 364 2005A 365 2005C G.O. Public 357 2002A G.O.TaxableG.O.G.O. Park Works G.O. Library Equipment360 2004A G.O. T.I. ImprovementRefundingFacilityTotals Nonmajor Debt BondsCertificateGOBonds..RefundBondsBondsBonds ServiceFunds BondsCertificateGOBondsRefundBondsBondsBondsServiceFunds 20082007 $490,700$138,173$346,700$ - $285,000$425,914$ - $1,809,190$1,942,928 - - 47,533 - 54,435 - - 112,879493,426 - - - - - - - 6,20229,250 27,673 - 20,222 - 40,46519,9193,935133,180191,246 518,373138,173414,4550379,900445,8333,9352,061,4512,656,850 - - - - - - - - 1,755 240,000130,000370,00055,000279,552590,000 - 2,219,5521,750,000 221958,3185,37675,55546,216325,63450, -632535,484664, 2219583185376755554621632563450632535484664 461,958133,185407,675110,546495,877653,45002,852,0872,236,419 56,4154,9886,780(110,546)(115,977)(207,617)3,935(790,636)420,431 - - - - - - 385,692385,692 - - - - 110,546 - 269,986 - 380,532326,955 110,546269,986380,532326,955 - - - - (93,160) - - (93,160)(1,256,971) 000110,546(93,160)269,986385,692673,064(930,016) 56,4154,9886,7800(209,137)62,369389,627(117,572)(509,585) 713,72221,635598,709 - 885,729775,421 - 3,960,8864,470,471 $770137$770,137$26,623$605,489$0$676,592$837,790$389,627$3,843,314$3,960,886$26623$605489$0$676592$837790$389627$3843314$3960886 101 - This page intentionally left blank - 102 NONMAJOR CAPITAL PROJECT FUNDS Capital Project Funds are used to account for the construction and financing of large capital projects. Revenues and expenditures are recognized on the modified accrual basis. Revenues are recognized in the accounting period in which they become available and measurable. Expenditures are recognized in the accounting period in which they are incurred. Most capital projects are singular in purpose and their revenues/expenditures 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 Project Funds differ in that several of the expenditure categories represent recurring types of costs, i.e., personal services, repair and maintenance of utilities, and/or recurring land improvements. 400 Capital Replacement Fund – accounts for monies collected from developers for inspection and administrative services for projects. – accounts for park dedication fees as required by the 410 Park Acquisition & Development City ordinance. These funds are then utilized to finance park and trail improvements identified in the park and recreation section of the cities comprehensive plan. – accounts for construction of the Lyman Blvd. project. 411 Lyman Blvd. Improvements 415 Municipal State Aid Fund – accounts for monies received from the State for improving designated State aid roads and can be used only for those purposes. 420 Street Pavement Management – accounts for sealcoating costs on local streets. 464 Highway 212 Improvements State Loan Fund – accounts for the loan proceeds received and offsetting expenditures relating to infrastructure improvements around Highway 312. 463 212/101 GAP Fund – accounts for construction of the Highway 212/101 GAP. 464 Gateway Place TIF District, 491 TID #4 Entertainment, 494 TID #5 North Bay, 495 TID #6 Gateway West, and 498 #8 Presbyterian Homes – account for financing improvements in tax increment financing districts. 600 Special Assessment Projects – accounts for the construction or projects financied by special assessments. 602 2006A Special Assessment Bonds – accounts for the construction costs related to the MUSA area improvements. 103 CITY OF CHANHASSEN, MINNESOTA SUBCOMBINING BALANCE SHEET NONMAJOR CAPITAL PROJECT FUNDS December 31, 2008 With Comparative Totals For December 31,, 2007 WithComparativeTotalsForDecember312007 410 Park 464 Highway 400 Capital Acquisition420 Street 212461 Gateway ReplacementandPavementImprovementsPlace TIF FundDevelopmentManagementState LoanDistrict AAssets: Cash and investments$1,392,240$3,600,973$559,120$ - $1,825 Accrued interest receivable11,48436,1975,728 - - Due from other governments - - - - - Accounts receivable - net22,885 - - - - Property taxes receivable7,296 - 2,369 - - Special assessments receivable - - - - - Total assets$1,433,905$3,637,170$567,217$0$1,825 Liabilities and Fund Balance Liabilities: Accounts payable$32,369$ - $ - $ - $ - Due to other funds - - - - - Contractspayable - 11,924 - - - Contractspayable11,924 Due to other governments - - - - - Deferred revenue - - - - - Total liabilities32,36911,924000 Fund balance (deficit): Unreserved: Designated for capital improvements1,401,5363,625,246567,217 - - Undesignated - - - - 1 ,8,25 Undesignated1825 Total fund balance (deficit)1,401,5363,625,246567,21701,825 Total liabilities and fund balance$1,433,905$3,637,170$567,217$0$1,825 104 Statement 17 602 2006A 603 Lyman 498 TID #8 600 Special SpecialBlvd 491 TID #4 494 TID #5 PresbyterianAssessmentAssessmentImprovementsTotals Nonmajor Capital Project EntertainmentNorth BayHomesProjectsBonds06-03 Funds 20082007 $515,699$ - $126,570$30,951$399,745$407,814$7,034,937$7,582,195 4,752 - 6381184,9165,52869,36185,806 - - - - - - - 309,143 - - - - 90,176509113,570121,095 - 1,820 - - - - 11,4859,577 - - - 39,328 - - 39,32859,210 $520,451$1,820$127,208$70,397$494,837$413,851$7,268,681$8,167,026 $27,569$ - $ - $ - $ - $509$60,447$323,429 - 13,409 - - - - 13,409234,177 - - - - - - 11,924117,545 11,924117,545 - - - - - - - 400,293 - 1,820 - 39,180 - 62,682103,682367,312 27,56915,229039,180063,191189,4621,442,756 492,882 - 127,20831,217494,837350,6607,090,8036,963,704 -(13,,409) - - - - (11,58,4)(239,,434) (13409)(11584)(239434) 492,882(13,409)127,20831,217494,837350,6607,079,2196,724,270 $520,451$1,820$127,208$70,397$494,837$413,851$7,268,681$8,167,026 105 - This page intentionally left blank - 106 CITY OF CHANHASSEN, MINNESOTA Statement 18 SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND Page 1 of 2 CHANGES IN FUND BALANCES NONMAJOR CAPITAL PROJECT FUNDS ForTheYearEndedDecember312008, ForTheYearEndedDecember312008 With Comparative Totals For The Year Ended December 31, 2007 410 Park 400 Capital Acquisition411 Lyman 420 Street ReplacementandBlvd415 Municipal Pavement FundDevelopmentImprovementsState Aid FundManagement Revenues: Revenues: General property taxes$824,000$ - $ - $ - $267,875 Tax increment collections - - - - - Licenses and permits - 432,542 - - - Intergovernmental - - - 100,000 - Special assessments - - - - - Charges for services - - - - - Investment income61,429191,225 - - 35,864 Contributions and donations2,500 - - - - Other13,3082,500 - - - Total revenues901,237626,2670100,000303,739 Expenditures: Current: General government133,343 - - - - Publicsafetyuc saey32517, - - - - Pblift32517 Public works8,146 - - 10,548265,502 Parks and recreation27,95354,954 - - - Community development - - - - - Capital outlay: General government92,352 - - - - Public safety54,284 - - - - Public works223,600 - - - - Publicworks223,600 Parks and recreation108,442534,066 - - - Developer assistance - - - - - Total expenditures680,637589,020010,548265,502 Revenues over (under) expenditures220,60037,247089,45238,237 Other financing sources (uses): LidLoans issued - - - - - Transfer in - - - - 628,750 Transfer out - - (260,985)(628,750) - Sale of capital assets10,695 - - - - Total other financing sources (uses)10,6950(260,985)(628,750)628,750 Net change in fund balance231,295 37,247 (260,985)(539,298)666,987 Fund balance (deficit) - January 11,170,2413,587,999260,985539,298(99,770) Fund balance (deficit) - December 31$1,401,536$3,625,246$0$0$567,217 107 CITY OF CHANHASSEN, MINNESOTA SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR CAPITAL PROJECT FUNDS ForTheYearEndedDecember312008, ForTheYearEndedDecember312008 With Comparative Totals For The Year Ended December 31, 2007 464 Highway 212461 Gateway ImprovementsPlace TIF 463 212/101 491 TID #4 494 TID #5 State LoanDistrictGapEntertainmentNorth Bay Revenues: Revenues: General property taxes$ - $ - $ - $ - $ - Tax increment collections -416 - 211,89977,401 Licenses and permits - - - - - Intergovernmental - - - - 7,705 Special assessments - - - - - Charges for services - - - - - Investment income - - - 26,310 - Contributions and donations - - - - - Other - 6,297 - - - Total revenues06,7130238,20985,106 Expenditures: Current: General government - - - - - Publicsafetyuc saey - - - - - Pblift Public works24,839 - 4,203 - - Parks and recreation - - - - - Community development -590 - 45,2932,100 Capital outlay: General government - - - - - Public safety - - - - - Public works - - - - - Publicworks Parks and recreation - - - - - Developer assistance - - - - 50,006 Total expenditures24,8395904,20345,29352,106 Revenues over (under) expenditures(24,839)6,123(4,203)192,91633,000 Other financing sources (uses): LidLoans issued2483924,839 - - - - Transfer in - - 93,160 - - Transfer out - - - (110,546) - Sale of capital assets - - - - - Total other financing sources (uses)24,839093,160(110,546)0 Net change in fund balance0 6,123 88,957 82,370 33,000 Fund balance (deficit) - January 1 - (4,298)(88,957)410,512(46,409) Fund balance (deficit) - December 31$0$1,825$0$492,882($13,409) 108 Statement 18 Page 2 of 2 602 2006A 603 Lyman 498 TID #8 600 Special SpecialBlvd 495 TID #6 PresbyterianAssessmentAssessmentImprovementsTotals Nonmajor Capital Project Gateway WestHomesProjectsBonds06-03Funds 20082007 20082007 $ - $ - $ - $ - $ - $1,091,875$1,074,750 - 186,935 - - - 476,651420,526 - - - - - 432,542496,352 - - - - 1,437,3181,545,023494,351 - - 23,467 - - 23,46725,837 - - - - 56,84456,84414,520 -3,43861214,77132,831366,480453,882 - - - - - 2,50012,500 - - - - - 22,10543,730 0190,37324,07914,7711,526,9934,017,4873,036,448 - - - - - 133,343116,887 - - - - - 32517,196398, 32517196398 - - - - 330,264643,502462,971 - - - - - 82,907106,789 -341 - - - 48,324407,556 - - - - - 92,3526,734 - - - - - 54,284505,215 - - - 120,9131,107,0541,451,567982,494 120,9131,107,0541,451,567982,494 - - - - - 642,5081,070,648 - 176,049 - - - 226,055206,753 0176,3900120,9131,437,3183,407,3594,062,445 013,98324,079(106,142)89,675610,128(1,025,997) - - - - - 24,839 - 24839 - - - - 260,985982,895936,524 (273,327) - - - - (1,273,608)(1,080,591) - - - - - 10,69516,740 (273,327)000260,985(255,179)(127,327) (273,327)13,983 24,079 (106,142)350,660 354,949 (1,153,324) 273,327113,2257,138600,979 - 6,724,2707,877,594 $0$127,208$31,217$494,837$350,660$7,079,219$6,724,270 109 CITY OF CHANHASSEN, MINNESOTA Statement 19 SPECIAL REVENUE FUND - CONTRIBUTION FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL For The Year Ended December 31, 2008 With Comparative Actual Amounts For The Year Ended December 31, 2007 20082007 Budgeted AmountsActualVariance withActual OriginalFinalAmountsFinal BudgetAmounts Revenues: Investment income$1,500$1,500$2,006$506$2,341 Contributions and donations18,00018,00010,260(7,740)12,167 Total revenues19,50019,50012,266(7,234)14,508 Expenditures: Current: Public safety17,50017,50017,500 - 17,500 Capital outlay2,0002,000 - 2,000 - Total expenditures19,50019,50017,5002,00017,500 Revenues over (under) expenditures$0$0(5,234)($5,234)(2,992) Fund balance - January 134,73337,725 Fund balance - December 31$29,499$34,733 110 CITY OF CHANHASSEN, MINNESOTA Statement 20 SPECIAL REVENUE FUND - CATV SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL ForTheYearEndedDecember312008, ForTheYearEndedDecember312008 With Comparative Actual Amounts For The Year Ended December 31, 2007 20082007 Budgeted AmountsActualVariance withActual OriginalFinalAmountsFinal BudgetAmounts Revenues: Revenues: Franchise fees$150,000$150,000$185,566$35,566$183,542 Investment income8,0008,00020,78812,78821,438 Total revenues158,000158,000206,35448,354204,980 Expenditures: Current: Personal services83,20083,20083,783(583)80,968 () Materials and supplies500500740(240)4,959 Contractual services17,00017,0003,30413,6962,280 Capital outlay5,5005,500141,248(135,748) - Total expenditures106,200106,200229,075(122,875)88,207 Revenues over expenditures$51,800$51,800(22,721)($74,521)116,773 FdblJ1Funaance - January 5484385,431665,5 dbl14843843166 Fund balance - December 31$525,717$548,438 111 - This page intentionally left blank - 112 FIDUCIARY FUNDS Fiduciary 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 measurable. Expenditures are recognized in the accounting period in which the related liability is incurred. 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 restoration to a gravel pit when it ceases operation. 113 CITY OF CHANHASSEN, MINNESOTA Statement 21 COMBINING STATEMENT OF NET ASSETS AGENCY FUNDS December 31, 2008 With Comparative Totals For December 31, 2007 913 Moon Valley 815 Escrow Restoration FundFundTotals 20082007 Assets: Cash and investments$625,127$84,278$709,405$808,404 Liabilities: Accounts payable$1,500$ - $1,500$2,245 Escrow deposits payable623,62784,278707,905806,159 Total liabilities$625,127$84,278$709,405$808,404 114 CITY OF CHANHASSEN, MINNESOTA Statement 22 COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES AGENCY FUNDS For The Year Ended December 31, 2008 BalanceBalance 01/01/08AdditionsDeletions12/31/08 Escrow Fund Assets: Cash and investments$725,992$200,144$301,009$625,127 Liabilities: Accounts payable$2,245$1,500$2,245$1,500 Escrow deposits payable723,747198,644298,764623,627 Total liabilities$725,992$200,144$301,009$625,127 Moon Valley Restoration Fund Assets: Cash and investments$82,412$1,866$ - $84,278 Liabilities: Escrow deposits payable$82,412$1,866$ - $84,278 Totals - All Agency Funds Assets: Cash and investments$808,404$202,010$301,009$709,405 Liabilities: Accounts payable$2,245$1,500$2,245$1,500 Escrow deposits payable806,159200,510298,764707,905 Total liabilities$808,404$202,010$301,009$709,405 115 - This page intentionally left blank - 116 SUPPLEMENTARY FINANCIAL INFORMATION 117 CITY OF CHANHASSEN, MINNESOTA COMBINED SCHEDULE OF INDEBTEDNESS December 31, 2008 Final InterestIssueMaturity Bonded indebtedness:RatesDateDate General Obligation Bonds: G.O. Library Bonds, Series 2002A1.55%-4.85%03/01/0202/01/22 G.O. Equipment Certificates, Series 2003A1.35%-2.45%08/01/0308/01/08 G.O. Park Refunding Bonds, Series 2005C3.50%11/16/0502/01/10 G.O. Capital Improvement Plan Bonds, Series 2008A4.00%-4.60%11/18/0802/01/30 Total General Obligation Bonds Revenue Bonds: 2000 Public Project Revenue Bonds4.75%-5.35%12/01/0002/01/12 Tax Increment Bonds: G.O. Tax Increment Refunding Bonds, Series 2004C3.00%-6.00%08/10/0402/01/21 General Improvement Bonds: G.O. Improvement Bonds, Series 1999A3.80%-4.90%12/01/9902/01/10 G.O. Improvement Bonds, Series 2001B4.00%-4.30%07/15/0102/01/10 .. Imrmnt Bn,ri 2004A2.50-4.00081004020115 G.O.poveeods,Sees.%.%//// GOImprovementBondsSeries2004A250%400%08/10/0402/01/15 G.O. Improvement Bonds, Series 2006A3.75%-3.80%06/13/0602/01/14 Total General Improvement Bonds Enterprise Fund Debt: G.O. Water Revenue Bonds of 1998, Series C3.90%-4.55%06/01/9802/01/09 G.O. Water Revenue Bonds of 1999, Series A3.80%-5.00%12/01/9902/01/10 G.O. Sewer and Water Revenue Bonds 2001, Series A3.50%-4.65%07/15/0102/01/12 G.O. Water Revenue Bonds of 2004, Series B4.00%-4.50%08/10/0402/01/25 G.O. Water Revenue Bonds of 2005, Series B3.75%-3.90%11/16/0502/01/21 Total Enterprise Fund Debt Total bonded indebtedness Other debt: Loan payable for highway construction3.81%-4.30%04/19/0507/01/17 Compensated absences payable Total City indebtedness 118 Exhibit 1 Prior YearsPayable2008PayablePrincipal OriginalJanuary 1,December 31,Due in IssuePayments2008IssuedPayments20082009 $6,095,000$1,005,000$5,090,000$ - $240,000$4,850,000$250,000 630,000500,000130,000 - 130,000 - - 2,590,000495,0002,095,000 - 590,0001,505,000610,000 - - - 7,550,000 - 7,550,000 - 9,315,0002,000,0007,315,0007,550,000960,00013,905,000860,000 930,000400,000530,000 - 95,000435,000100,000 1,170,000100,0001,070,000 - 55,0001,015,00055,000 2,585,0002,365,000220,000 - 220,000 - - 640,000400,000240,000 - 240,000 - - ,00,00015,0001,355,000 - 3 0,00085,000380,000 2,7,7,,,7,9,, 20700007150001355000370000985000380000 6,640,000 - 6,640,000 - 470,0006,170,000840,000 11,935,0003,480,0008,455,00001,300,0007,155,0001,220,000 820,000610,000210,000 - 210,000 - - 1,670,0001,080,000590,000 - 590,000 - - 1,645,0001,120,000525,000 - 130,000395,000130,000 7,930,000575,0007,355,000 - 280,0007,075,000290,000 5,465,000230,0005,235,000 - 290,0004,945,000300,000 17,530,0003,615,00013,915,00001,500,00012,415,000720,000 40,880,0009,595,00031,285,0007,550,0003,910,00034,925,0002,955,000 3,853,005 - 3,828,16624,839477,8803,375,125318,002 - - 752,921548,442480,615820,74850,952 $44,733,005$9,595,000$35,866,087$8,123,281$4,868,495$39,120,873$3,323,954 119 CITY OF CHANHASSEN, MINNESOTA Exhibit 2 DEBT SERVICE PAYMENTS TO MATURITY GENERAL OBLIGATION BONDS December 31, 2008 G.O. Tax 2000IncrementG.O. ParkG.O. Capital Public ProjectG.O. LibraryRefundingRefundingImprovement RevenueBonds,Bonds,Bonds,Plan Bonds, BondSeries 2002ASeries 2004CSeries 2005CSeries 2008ATotal Bonds payable$435,000$4,850,000$1,015,000$1,505,000$7,550,000$15,355,000 Future interest payable47,5691,753,744413,15757,6624,308,8446,580,976 $482,569$6,603,744$1,428,157$1,562,662$11,858,844$21,935,976 Payments to maturity: 2009$120,152$462,579$107,979$652,000$225,358$1,568,068 2010119,899462,821110,485910,662320,6681,924,535 2011119,308467,251107,725 - 565,6671,259,951 2012123,210465,873109,720 - 560,5681,259,371 2013 - 468,620111,345 - 560,1671,140,132 2014 - 470,315107,775 - 559,3681,137,458 2015 - 470,960109,005 - 558,1671,138,132 2016 - 470,686109,895 - 556,5681,137,149 2017 - 474,443110,440 - 559,4671,144,350 2018 - 472,213110,580 - 561,7681,144,561 2019 - 478,860110,308 - 558,4841,147,652 2020 - 479,249109,600 - 564,4231,153,272 2021 - 478,475113,300 - 564,4671,156,242 2022 - 481,399 - - 563,7051,045,104 2023 - - - - 567,013567,013 2024 - - - - 569,270569,270 2025 - - - - 570,454570,454 2026 - - - - 570,545570,545 2027 - - - - 574,412574,412 2028 - - - - 572,035572,035 2029 - - - - 578,275578,275 2030 - - - - 577,995577,995 $482,5696,603,744$1,428,157$1,562,662$11,858,844$21,935,976 120 CITY OF CHANHASSEN, MINNESOTA Exhibit 3 DEBT SERVICE PAYMENTS TO MATURITY GENERAL OBLIGATION IMPROVEMENT BONDS December 31, 2008 G.O.G.O. ImprovementImprovement Bonds,Bonds, Series 2004ASeries 2006ATotal Bonds payable$985,000$6,170,000$7,155,000 Future interest payable61,032735,713796,745 $1,046,032$6,905,713$7,951,745 Payments to maturity: 2009$406,438$1,057,300$1,463,738 2010360,1311,060,1441,420,275 201178,3001,253,0191,331,319 201275,8501,255,4501,331,300 201373,3131,260,8001,334,113 201426,5001,019,0001,045,500 201525,500 -25,500 $1,046,032$6,905,713$7,951,745 121 CITY OF CHANHASSEN, MINNESOTA Exhibit 4 DEBT SERVICE PAYMENTS TO MATURITY REVENUE BONDS December 31, 2008 G.O. Sewer & WaterG.O. WaterG.O. Water RevenueRevenueRevenue BondsBonds of 2004,Bonds of 2005, Series 2001ASeries BSeries BTotal Bonds payable$395,000$7,075,000$4,945,000$12,415,000 Future interest payable29,9192,922,9251,326,0594,278,903 $424,919$9,997,925$6,271,059$16,693,903 Payments to maturity: 2009$144,565$582,954$481,633$1,209,152 2010139,008581,154480,1951,200,357 201169,718583,854478,3821,131,954 201271,628581,054481,1011,133,783 2013 -582,754483,2581,066,012 2014 -583,854479,9451,063,799 2015 -584,354486,0701,070,424 2016 -584,254481,6331,065,887 2017 -583,354481,7261,065,080 2018 -586,334486,0571,072,391 2019 -588,164484,5121,072,676 2020 -589,039482,2841,071,323 2021 -593,655484,2631,077,918 2022 -591,935 -591,935 2023 -598,787 -598,787 2024 -599,150 -599,150 2025 -603,275 -603,275 $424,919$9,997,925$6,271,059$16,693,903 122 CITY OF CHANHASSEN, MINNESOTA Exhibit 5 TAXABLE VALUATIONS, TAX LEVIES AND TAX RATES December 31, 2008 Taxable Capacity Valuations: Tax Capacity Values Property Type2007/2008 Real estate and personal property: Hennepin County$1,637,734 Carver County37,963,895 Fiscal disparities: Distribution1,867,771 Contribution(3,366,665) Less: captured tax increment value(479,494) Net tax capacity$37,623,241 Tax Levy and Tax Rates: Payable 2008 Tax CertifiedCapacity LevyRate (1) Taxes levied: Revenue$6,833,90016.477 Debt Service3,001,0657.236 Totals$9,834,96523.713 (1) Urban rate 123 CITY OF CHANHASSEN, MINNESOTA Exhibit 6 SCHEDULE OF DEFERRED TAX LEVIES December 31, 2008 Public ProjectG.O. ParkG.O. CapitalTotalG.O.G.O.TotalTotal Years ofRevenueLibraryRefundingImprovementGeneralImprovementImprovementGeneralDeferred Levy/BondsBondsBondsPlan BondsBondedBondsBondsImprovementTax Collectionof 2000of 2002Aof 2005Cof 2008ADebtof 2004Aof 2005ABondsLevies 2008/2009$122,603$491,300$972,700$ - $1,586,603$297,900$285,000$582,900$2,169,503 2009/2010122,195496,400 - 599,3001,217,895 - 285,000285,0001,502,895 2010/2011126,420495,400 - 594,0001,215,820 - 285,000285,0001,500,820 2011/2012 - 498,800 - 593,8001,092,600 - 285,000285,0001,377,600 2012/2013 - 501,200 - 593,2001,094,400 - 285,000285,0001,379,400 2013/2014 - 502,400 - 592,1001,094,500 - 285,000285,0001,379,500 2014/2015 - 502,500 - 590,6001,093,100 - 285,000285,0001,378,100 2015/2016 - 507,000 - 594,0001,101,000 - 285,000285,0001,386,000 2016/2017 - 505,100 - 596,7001,101,800 - - - 1,101,800 2017/2018 - 512,800 - 593,6001,106,400 - - - 1,106,400 2018/2019 - 513,900 - 600,3001,114,200 - - - 1,114,200 2019/2020 - 513,700 - 600,8001,114,500 - - - 1,114,500 2020/2021 - 517,500 - 600,4001,117,900 - - - 1,117,900 2021/2022 - - - 604,500604,500 - - - 604,500 2022/2023 - - - 607,400607,400 - - - 607,400 2023/2024 - - - 609,200609,200 - - - 609,200 2024/2025 - - - 609,900609,900 - - - 609,900 2025/2026 - - - 614,600614,600 - - - 614,600 2026/2027 - - - 612,700612,700 - - - 612,700 2027/2028 - - - 620,100620,100 - - - 620,100 2028/2029 - - - 620,600620,600 - - - 620,600 $371,218$6,558,000$972,700$12,047,800$19,949,718$297,900$2,280,000$2,577,900$22,527,618 124 III. STATISTICAL SECTION (UNAUDITED) 125 III. STATISTICAL SECTION (UNAUDITED) This part of the City of Chanhassen, Minnesota’s Comprehensive Annual Financial Report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City of Chanhassen, Minnesota’s overall financial health. Contents Pages Financial Trends These tables contain trend information to help the reader understand how the 127-131 City’s financial performance and well-being have changed over time. Revenue Capacity These tables contain information to help the reader assess the City’s most 132-137 significant local revenue source, the property tax. Debt Capacity These tables present information to help the reader assess the affordability of the 138-142 City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future. Demographic and Economic Information These tables offer demographic and economic indicators to help the reader 143-145 understand the environment within which the City’s financial activities take place. Operation Information These tables contain service and infrastructure data to help the reader understand 146-151 how the information in the City’s financial report relates to the services the City provides and the activities it performs. Sources: Unless otherwise noted, the information in these tables is derived from the comprehensive financial reports for the relevant year. 126 CITY OF CHANHASSEN, MINNESOTA Table 1 NET ASSETS BY COMPONENT (1) Last Six Fiscal Years (Accrual Basis of Accounting) 200320042005200620072008 Governmental activities: Invested in capital assets, net of related debt$76,644,369$77,583,392$72,418,684$70,216,944$68,982,379$70,611,368 Restricted: Debt service2,565,4865,762,41410,174,5027,687,15511,047,06212,165,653 Tax increment purposes779,619630,5661,049,0471,063,589797,064621,915 Unrestricted11,477,63810,632,18411,239,65816,220,83414,631,16615,171,391 Total governmental activities net assets$91,467,112$94,608,556$94,881,891$95,188,522$95,457,671$98,570,327 Business-type activities: Invested in capital assets, net of related debt$46,050,122$38,888,555$37,479,967$47,807,323$52,502,257$55,541,752 Restricted: Debt service - - - - - - Tax increment purposes - - - - - - Unrestricted12,779,70121,908,22423,767,12215,039,02117,292,10613,117,323 Total business-type activities net assets$58,829,823$60,796,779$61,247,089$62,846,344$69,794,363$68,659,075 Primary government: Invested in capital assets, net of related debt$122,694,491$116,471,947$109,898,651$118,024,267$121,484,636$126,153,120 Restricted: Debt service2,565,4865,762,41410,174,5027,687,15511,047,06212,165,653 Tax increment purposes779,619630,5661,049,0471,063,589797,064621,915 Unrestricted24,257,33932,540,40835,006,78031,259,85531,923,27228,288,714 Total primary government net assets$150,296,935$155,405,335$156,128,980$158,034,866$165,252,034$167,229,402 (1) The City implemented GASB Statement No. 34 for the fiscal year ended December 31, 2003. Therefore, information for years prior to 2003 is not available. 127 CITY OF CHANHASSEN, MINNESOTA Table 2 CHANGES IN NET ASSETS (1) Page 1 of 2 Last Six Fiscal Years (Accrual Basis of Accounting) 200320042005200620072008 Expenses Governmental activities: General government$2,201,345$2,338,485$4,518,355$2,380,103$2,439,716$2,469,055 Public safety2,587,0192,618,3072,653,3042,851,9263,098,0683,062,941 Public works5,140,0284,955,5984,915,4357,722,4667,010,9816,220,816 Parks and recreation2,578,5852,674,9542,867,3642,918,6453,023,0323,025,987 Community development891,2532,027,713595,878868,7491,052,104704,979 Interest on long-term debt1,018,936822,047505,367751,964835,059652,015 Total governmental activities expenses14,417,16615,437,10416,055,70317,493,85317,458,96016,135,793 Business-type activities: Water1,973,9131,985,9082,656,3812,754,2013,112,5753,234,139 Sewer2,774,2312,686,1462,719,1563,069,0693,177,3663,072,588 Surface water management784,557957,0841,039,7211,317,0891,238,9141,121,197 Total business-type activities expenses5,532,7015,629,1386,415,2587,140,3597,528,8557,427,924 Total primary government expenses$19,949,867$21,066,242$22,470,961$24,634,212$24,987,815$23,563,717 Program revenues Governmental activities: Charges for services: Licenses and permits$1,996,169$1,892,579$2,166,022$3,612,021$2,171,558$1,810,545 Charges for services1,075,631997,1141,196,1031,218,8161,132,4481,115,903 Fines and forfeits43,73261,801104,962162,946145,682124,633 Operating grants and contributions267,126370,090361,093671,674452,798346,023 Capital grants and contributions1,171,5892,633,9165,080,5122,506,8227,464,6973,221,636 Total governmental activities program revenues4,554,2475,955,5008,908,6928,172,27911,367,1836,618,740 Business-type activities: Charges for services: Water1,582,6321,656,9111,703,5012,111,2302,461,2052,408,379 Sewer1,633,4401,748,9291,905,2062,008,3562,186,6222,187,209 Surface water management258,132265,090299,445424,702452,148479,318 Operating grants and contributions13,2216,3811,62053945,17236,350 Capital grants and contributions1,694,9983,528,2701,961,1222,501,5983,340,5981,527,624 Total business-type activities program revenues5,182,4237,205,5815,870,8947,046,4258,485,7456,638,880 Total primary government program revenues$9,736,670$13,161,081$14,779,586$15,218,704$19,852,928$13,257,620 128 CITY OF CHANHASSEN, MINNESOTA Table 2 CHANGES IN NET ASSETS (1) Page 2 of 2 Last Six Fiscal Years (Accrual Basis of Accounting) 200320042005200620072008 Net (expense) revenue: Governmental activities($9,862,919)($9,481,604)($7,147,011)($9,321,574)($6,091,777)($9,517,053) Business-type activities(350,278)1,576,443(544,364)(93,934)956,890(789,044) Total primary government net (expense) revenue(10,213,197)(7,905,161)(7,691,375)(9,415,508)(5,134,887)(10,306,097) General revenues and other changes in net assets Governmental activities: Property taxes$8,330,561$8,398,790$9,451,141$9,165,278$9,419,763$9,651,758 Tax increment collections4,804,0194,623,927675,117315,398420,526574,101 Grants and contributions not restricted to specific programs59,86755,87945,45528,592189,616108,039 Unrestricted investment earnings240,859164,712387,370905,9301,397,7461,150,993 Miscellaneous98,812222,64293,79234,644 - - Gain on sale of capital assets582,333540,64623,795 - 10,80632,195 Transfers(121,355)(96,195)(481,824)(821,637)(5,077,531)1,112,623 Total governmental activities13,995,09613,910,40110,194,8469,628,2056,360,92612,629,709 Business-type activities: Unrestricted investment earnings90,738255,510466,750768,600786,455797,079 Miscellaneous - 255,27946,100102,952127,14322,464 Transfers121,35596,195481,824821,6375,077,531(1,112,623) Total business-type activities212,093606,984994,6741,693,1895,991,129(293,080) Total primary government$14,207,189$14,517,385$11,189,520$11,321,394$12,352,055$12,336,629 Change in net assets: Governmental activities$4,132,177$4,428,797$3,047,835$306,631$269,149$3,112,656 Business-type activities(138,185)2,183,427450,3101,599,2556,948,019(1,082,124) Total primary government$3,993,992$6,612,224$3,498,145$1,905,886$7,217,168$2,030,532 (1) The City implemented GASB Statement No. 34 for the fiscal year ended December 31, 2003. Therefore, information for years prior to 2003 is not available. 129 CITY OF CHANHASSEN, MINNESOTA Table 3 FUND BALANCES, GOVERNMENTAL FUNDS (1) Last Six Fiscal Years (Modified Accrual Basis of Accounting) 200320042005200620072008 General Fund: Reserved Prepaid items$17,056$21,003$20,239$17,376$13,210$21,173 Unreserved: Designated General fund3,328,5303,125,9103,199,8003,279,0503,416,9503,586,750 Undesignated General fund2,571,9493,128,6303,731,0231,523,8442,061,1261,273,796 Total general fund$5,917,535$6,275,543$6,951,062$4,820,270$5,491,286$4,881,719 All other governmental funds: Reserved Prepaid items$4,804$523$523$523$ - $25 Future programs11,85319,73535,90937,72534,73329,499 Debt service4,110,3166,922,5526,560,8845,262,5347,300,4926,641,747 Unreserved: Designated Special revenue funds567,443533,276489,370431,665548,438525,692 Capital project funds3,638,5923,978,8184,114,82013,458,6979,934,93618,732,625 Undesignated Special revenue funds5,948,5381,089,942 - 25,020 - - Debt service funds(3,020,544) - 3,403,769148,784215,298237,721 Capital project funds(2,013,776)(893,811)(738,510)(214,183)(239,434)(11,584) Total all other governmental funds$9,247,226$11,651,035$13,866,765$19,150,765$17,794,463$26,155,725 (1) The City implemented GASB Statement No. 34 for the fiscal year ended December 31, 2003. Therefore, information for years prior to 2003 is not available. 130 CITY OF CHANHASSEN, MINNESOTA Table 4 CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS (1) Last Six Fiscal Years 200320042005200620072008 Revenues: General property taxes$8,292,083$8,443,464$9,417,527$9,140,601$9,403,109$9,582,333 Tax increment collections4,975,8604,917,923675,798$315,398$420,526$574,101 Licenses and permits1,996,1681,892,5792,166,0223,727,2972,171,5581,810,545 Intergovernmental1,082,5491,013,7041,244,6562,171,5651,148,0342,147,970 Special assessments1,963,4312,262,7311,113,9221,922,9443,922,517623,893 Charges for services839,522943,744863,958899,015738,669841,209 Fines and forfeits43,73261,801104,962162,946145,682124,633 Investment income240,859164,712387,370905,9301,397,7461,150,993 Contributions and donations9,67524,74971,19843,94947,42843,410 Other364,151290,629430,171279,549404,426289,277 Total revenues19,808,030 20,016,036 16,475,584 19,569,194 19,799,695 17,188,364 Expenditures: Current: General government2,072,0512,203,6072,722,1712,090,5652,116,9282,102,512 Public safety2,424,1252,461,4102,547,6762,656,9232,924,7512,885,296 Public works1,958,0921,773,6552,367,6524,425,2373,735,9502,786,397 Parks and recreation1,629,8561,622,1991,658,2001,877,1091,848,8801,933,353 Community development312,446326,134372,938451,092841,306468,819 Capital outlay: General government - - 311,25098,3966,734233,600 Public safety - 99,87210,26538,593505,21554,284 Public works3,427,2361,787,7372,334,5776,431,5946,693,3874,677,179 Parks and recreation2,362615,207462,794377,3671,491,848642,508 Debt service: Principal 10,700,0007,752,0002,035,0001,375,0001,750,0002,689,552 Interest and paying agent fees1,070,394687,299691,230591,614769,212874,848 Bond issuance costs13,63529,317 - 36,987 - 93,811 Developer assistance578,2911,660,088230,353111,791206,753226,055 Other93,95411,046897,523300,000 - - Total expenditures24,282,442 21,029,571 16,641,629 20,862,268 22,890,964 19,668,214 Revenues over (under) expenditures(4,474,412)(1,013,535)(166,045)(1,293,074)(3,091,269)(2,479,850) Other financing sources (uses): Bonds issued630,0003,240,0002,590,0006,640,000 - 7,550,000 Remption of refunding bonds - - - (3,560,000) - - Loans issued - - 105,419708,0033,014,74424,839 Transfers in(121,355)(54,242)338,080702,889537,5642,646,011 Transfers out - - - - (1,163,065) - Bond discount(3,937)(10,387) - (44,610) - - Sale of capital assets702,596963,29023,795 - 16,74010,695 Total other financing sources (uses)1,207,304 4,138,661 3,057,294 4,446,282 2,405,983 10,231,545 Net change in fund balance($3,267,108)$3,125,126$2,891,249$3,153,208($685,286)$7,751,695 Debt service as a percentage of noncapital expenditures58.4%50.2%22.0%14.8%18.0%26.4% Debt service as percentage of total expenditures48.5%40.3%16.4%9.6%11.0%18.6% (1) The City implemented GASB Statement No. 34 for the fiscal year ended December 31, 2003. Therefore, information for years prior to 2003 is not available. 131 CITY OF CHANHASSEN, MINNESOTA TAX CAPACITY VALUE AND ESTIMATED MARKET VALUE OF TAXABLE PROPERTY Last Ten Fiscal Years Fiscal YearCommercial/Total EndedResidentialIndustrialAllTax December 31,PropertyAgriculturalPropertyOtherCapacity 1999(a)(a)(a)(a)$22,666,448 2000(a)(a)(a)(a)22,428,067 2001$18,842,469$171,965$7,743,027$558,77527,316,236 200215,094,239162,6495,334,174349,27020,940,332 200317,032,236133,3005,866,524357,87223,389,932 200419,502,882141,9395,904,892377,53125,927,244 200522,438,051178,5986,054,042388,88529,059,576 200624,904,864229,6516,537,205408,07032,079,790 200727,853,083316,4618,114,703428,20336,712,450 200829,821,326208,7899,135,911435,60339,601,629 Sources: Carver County Auditor's Office and Hennepin County (a) Information not available (1) Tax Capacity as a Percent of EMV for years 1999 and 2000 was calculated on Total Tax Capacity since information for Captured Tax Capacity on Tax Increment District and Fiscal Disparity Contribution were not available. For years 2001 through 2008, Adjusted Tax Capacity was used to calculate Tax Capacity as a Percent of EMV. 132 Table 5 Captured Tax Capacity onFiscalAdjustedCityEstimatedTax Capacity Tax IncrementDisparityTax CapacityDirect TaxMarketas a Percent (1) of EMV DistrictContributionValueRateValue (a)(a)$22,666,44827.89100$1,194,012,2001.90% (a)(a)22,428,06726.895001,247,906,5001.80% ($5,920,832)$53,15421,448,55826.508001,593,928,1001.35% (3,309,835)3,36217,633,85937.823001,790,521,3000.98% (3,789,131)(19,916)19,580,88539.039002,010,114,7000.97% (3,958,013)17,05621,986,28732.922002,271,332,1000.97% (619,902)60,35428,500,02828.118002,552,120,2001.12% (309,211)(929,994)30,840,58526.638002,812,847,1001.10% (418,018)(955,204)35,339,22823.788003,175,746,5001.11% (479,494)(1,498,894)37,623,24123.713003,394,928,1001.11% 133 CITY OF CHANHASSEN, MINNESOTA Table 6 DIRECT AND OVERLAPPING PROPERTY TAX CAPACITY RATES Last Ten Fiscal Years CityOverlapping Rates FiscalDirectSchoolCarver YearRateDistrict #112CountyOtherTotal Tax capacity rates (per $100 of adjusted tax capacity value) 199927.8910062.0350047.593007.26300144.78200 200026.8950074.2370045.744006.27600153.15200 200126.5080060.8050043.105004.49500134.91300 200237.8230029.8080053.336007.31100128.27800 200339.0390038.4380053.137007.40200138.01600 200432.9220037.5240048.443005.84500124.73400 200528.1180033.2990044.107005.56000111.08400 200626.6380032.8080040.836005.30500105.58700 200723.7880035.8310037.802005.13200102.55300 200823.7130035.9700037.563005.54700102.79300 Source: Carver County Auditor's Office 134 CITY OF CHANHASSEN, MINNESOTA Table 7 PRINCIPAL PROPERTY TAXPAYERS Current Year and Nine Years Ago 20081999 Percentage Percentage Taxableof Total CityTaxableof Total City CapacityCapacityCapacityCapacity TaxpayerValueRankValueValueRankValue Rosemount Inc$396,69211.1%$590,23013.5% IRET Properties351,17020.9% - - 0.0% Istar LLC Properties326,30830.9% - - 0.0% LTF Real Estate Company Inc227,23240.6% - - 0.0% DRF Chanhassen Medical Bldg220,36050.6% - - 0.0% Northern States Power Co213,89060.6%305,26251.8% Target Corporation T-0862203,22470.5% - - 0.0% Park Avenue Lofts LLC193,65480.5% - - 0.0% Market Square Assoc Ltd Partnership175,39290.5%188,3008 1.1% McGlynn Bakeries Inc #366167,250100.4%393,995 3 2.3% Beddor Enterprises - - 0.0%433,3922 2.6% Wang - - 0.0%320,42541.9% TF James - - 0.0%301,263 6 1.8% The Press, Incorporated - - 0.0%210,175 7 1.2% PRN Music Corporation - - 0.0%162,92591.0% Individual - - 0.0%161,175 10 1.0% Total$2,475,1726.6%$3,067,14218.2% Total All Property $37,484,401$16,884,240 Source: Carver County Auditor's Office 135 - This page intentionally left blank - 136 CITY OF CHANHASSEN, MINNESOTA Table 8 PROPERTY TAX LEVIES AND COLLECTIONS Last Ten Fiscal Years FiscalTaxesCollected Within TheCollections YearLeviedFiscal Year of the LevyinTotal Collections to Date EndedFor ThePercentageSubsequentPercentage December 31,Fiscal YearAmountof LevyYearsAmountof Levy 1999$5,122,792$5,078,01699.1%$42,699$5,120,715100.0% 20005,286,618 5,226,462 98.9%34,2915,260,75399.5% 20015,679,054 5,646,328 99.4%102,1195,748,447101.2% 20027,655,9167,557,37898.7%45,7447,603,12299.3% 20038,639,1678,206,00195.0%91,7508,297,75196.0% 20048,639,1678,323,05396.3%126,8158,449,86897.8% 20059,439,7549,124,03096.7%120,1859,244,21597.9% 20069,354,8909,066,59196.9%82,5899,149,18097.8% 20079,575,7789,447,69298.7%71,8879,519,57999.4% 20089,834,9659,555,48997.2% - 9,555,48997.2% Source: City Finance Department 137 CITY OF CHANHASSEN, MINNESOTA RATIOS OF OUTSTANDING DEBT BY TYPE Last Ten Fiscal Years Governmental Activities GeneralGeneral FiscalObligationRevenueTax IncrementImprovementOther YearBondsBondsBondsBondsDebt 1999$6,105,000$ - $15,005,000$25,221,379$ - 20005,725,000930,0008,040,00021,966,605 - 20016,040,000930,0006,855,00019,411,686120,000 200211,355,000930,0004,915,00014,175,33180,000 200311,475,000860,0003,075,0005,890,00040,000 200410,710,000785,0001,170,0004,195,000 - 200512,215,000705,0001,170,0003,325,000105,419 20068,170,000620,0001,120,0009,210,000813,422 20077,315,000530,0001,070,0008,455,0003,828,166 200813,905,000435,0001,015,0007,155,0003,375,125 Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements. (1) The Bonded Debt and Bonded Debt Per Capita are Net of Debt Service Fund Balances. The Definition of "Net Bonded Debt" in the State of Minnesota would also exclude any Enterprise Fund Debt, Special Assessment Bonds, Tax Increment Bonds and Revenue Bonds. The "Net Bonded Debt" and "Net Bonded Debt Per Capita" as defined by the State of Minnesota can be found on Table 11. 138 Table 9 Business-Type Activities Less:Percentage G.O. RevenueDebt Serviceof TaxBonded Debt (1)(1) Bonded Debt BondsTotal DebtFund BalanceCapacityPer Capita $2,950,000$49,281,379$6,299,805$42,981,574246.79%$2,291 2,770,00039,431,6055,747,18033,684,425179.65%1,654 3,996,35037,353,0362,773,25534,579,781161.22%1,604 3,576,10035,031,4313,255,09531,776,336180.20%1,420 3,175,00024,515,0001,089,77223,425,228120.22%996 10,600,00027,460,0006,795,40620,664,59481.94%882 15,545,00033,065,4199,964,65323,100,76682.82%968 14,820,00034,753,4225,411,31829,342,10496.30%1,228 13,915,00035,113,1667,623,13827,490,02879.02%1,130 12,415,00038,300,1256,972,63031,327,49583.57%1,280 139 CITY OF CHANHASSEN, MINNESOTA Table 10 DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT December 31, 2008 Estimated EstimatedShare of DebtPercentageOverlapping Governmental UnitOutstandingApplicableDebt Direct debt: (1) City of Chanhassen $13,905,000100.00%$13,905,000 Overlapping debt: Chaska Independent School District238,900,00026.82%64,072,980 Eden Prairie Independent School District74,180,0000.94%697,292 Minnetonka Independent School District87,724,5480.00% - Carver County32,585,00032.94%10,733,499 Hennepin County501,975,3590.07%351,383 Hennepin Suburban Park District72,794,8150.09%65,515 Hennepin Regulatory Railroad Authority43,486,8620.07%30,441 Metropolitan Council137,904,6530.03%41,371 Subtotal - overlapping debt1,189,551,23775,992,481 Total direct and overlapping debt$1,203,456,237$89,897,481 (1) Excludes general obligation improvement bonds and revenue bonded indebtedness 140 CITY OF CHANHASSEN, MINNESOTA Table 11 LEGAL DEBT MARGIN INFORMATION Last Ten Fiscal Years Legal Debt Margin Calculation for Fiscal Year 2008 Market value$3,394,928,100 Applicable percentage3% Debt limit101,847,843 Debt applicable to limit: Total bonded debt34,925,000 Less: Special assessment bonds(7,155,000) Tax increment bonds(1,015,000) Revenue bonds(435,000) Enterprise Fund debt(12,415,000) Less: Cash and investments in G.O. Bond Debt Service Fund(1,980,562) 11,924,438 Legal debt margin$89,923,405 Legal Debt Margin Calculation for Fiscal Years 1999 Through 2008 Net DebtLegalAmount of DebtNet Bonded FiscalDebtApplicable toDebtApplicable toDebt Per YearPopulationLimitLimitMarginDebt LimitCapita 199918,76023,880,2445,363,84818,516,39622.46%286 200020,37124,958,1305,138,04519,820,08520.59%252 200121,56131,878,5625,629,81126,248,75117.66%261 200222,37635,810,42610,679,36025,131,06629.82%477 200323,52440,202,29410,571,25229,631,04226.30%449 200423,43145,426,6429,385,23236,041,41020.66%401 200523,86451,042,4048,150,62642,891,77815.97%342 200623,88956,256,9426,950,30449,306,63812.35%291 200724,32163,514,9305,844,64857,670,2829.20%240 200824,481101,847,84311,924,43889,923,40511.71%487 141 CITY OF CHANHASSEN, MINNESOTA Table 12 PLEDGED REVENUE COVERAGE Last Ten Fiscal Years Improvement Bonds Special FiscalAssessmentDebt Service YearCollectionsPrincipalInterestCoverage 1999$3,432,087Information Not Available 20002,992,985 $3,550,000$846,0610.681 20012,514,3633,506,350720,4480.595 20023,159,7785,479,750522,0720.526 20031,963,4315,446,600324,3300.340 20042,262,7313,765,000110,1180.584 20051,113,922870,000139,0591.104 20061,922,944755,000103,8132.239 20073,922,517755,000360,8523.515 2008623,8911,300,000287,7270.393 Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements. 142 CITY OF CHANHASSEN, MINNESOTA Table 13 DEMOGRAPHIC AND ECONOMIC STATISTICS Last Ten Fiscal Years Carver County ChanhassenCarver CountyCarver CountyPer Capita FiscalChanhassenUnemploymentUnemploymentPersonalPersonal (1)(2)(2)(3)(3) PopulationRateRateIncomeIncome Year 199918,760(a)2.1%$2,458,789$36,063 200020,3711.8%2.4%2,758,05538,921 200121,5612.8%3.3%2,957,40140,453 200222,3763.5%4.0%3,086,47640,776 200323,5243.3%4.1%3,198,89440,797 200423,4313.2%3.9%3,467,40042,779 200523,8642.6%3.4%3,800,56545,248 200623,8892.7%3.3%4,100,88247,443 200724,3213.1%4.0%(a)(a) 200824,4814.0%5.0%(a)(a) (1) Sources:Federal Census Data and Chanhassen Planning Department (2) State of Minnesota, Department of Employment and Economic Development (3) U.S. Department of Commerce, Bureau of Economic Analysis (a) Information not available Note: Information pertaining to Chanhassen Personal Income and Per Capita Personal Income is not available, information for Carver County was included instead. 143 - This page intentionally left blank - 144 CITY OF CHANHASSEN, MINNESOTA Table 14 PRINCIPAL EMPLOYERS (1) Current Year and Two Years Ago 20082006 EmployerProduct ServiceEmployeesEmployees Rosemount IncManufacturing1,4751,200 Lifetime FitnessFitness Center919 - Super Value HeadquartersSupermarket900900 Instant Web CompaniesAdvertising Material Distribution Svcs847548 General MillsCommercial Bakery475600 Chanhassen Dinner TheatresDinner Theatre300300 Banta Direct MarketingCommercial Printing383324 Byerly'sSupermarket280280 Minnesota Landscape ArboretumLandscape Arboretum230240 TargetGeneral Merchandise Store160 - EntegrisPlastics Material & Resin Mfg. -350 ABC/Lyman LumberWood Product Manufacturing -175 Total5,9694,917 Source: State of Minnesota, Department of Employment and Economic Development (1) Principal employer information prior to 2006 is not available 145 CITY OF CHANHASSEN, MINNESOTA FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION/PROGRAM Last Ten Fiscal Years Full-Time Equivalent Employees as of December 31, Function/Program199920002001 General government111111 Public safety533 Public works222223 Parks & recreation111111 Community development171717 Total666465 Source: City Finance Department 146 Table 15 Full-Time Equivalent Employees as of December 31, 2002200320042005200620072008 12121212121313 3333333 23232324252525 11111111111111 17161716161515 66656666676767 147 CITY OF CHANHASSEN, MINNESOTA OPERATING INDICATORS BY FUNCTION/PROGRAM Last Ten Fiscal Years Fiscal Year Function/Program199920002001 Building: Permits issued1,3211,0673,195 Estimated value$90,100,800$84,131,650$86,644,500 Election: Registered voters11,66511,66511,665 Fire: Average number of employees444444 General government: Area of city - square miles23.7823.7823.78 Average number of permanent full-time employees (excluding fire department)666465 Police: Average number of employees222 Number of major crimes145145145 Water: Number of customers5,4825,4825,482 Daily average consumption - gallons2,195,4582,195,4582,195,458 Plant capacity - gallons3,850,0003,850,0003,850,000 Source: Various City departments 148 Table 16 Fiscal Year 2002200320042005200620072008 1,3879149981,0081,1969541,046 $85,811,450$85,879,250$86,893,088$62,100,325$95,610,311$106,831,600$116,477,429 11,66513,72315,63215,63215,31915,31916,544 44434343444445 23.7823.7823.7823.7823.7823.7823.78 66656666676767 2111113131314 1453111,2881,0681,2971,2021,013 5,4826,5496,6606,7797,4827,6737,736 2,195,4583,000,0002,718,5992,571,8433,163,8643,031,4003,200,000 3,850,0008,900,0008,500,0008,650,0008,650,0008,650,0008,650,000 149 CITY OF CHANHASSEN, MINNESOTA CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM Last Ten Fiscal Years Fiscal Year Function/Program199920002001 Fire: Number of stations222 Parks and recreation: Acres of parks529529529 Acres of open space2,8152,8152,815 Number of shelter buildings888 Number of playgrounds222222 Number of swimming beaches333 Number of tennis courts777 Police: Number of stations111 Public works: Miles of streets146.0146.0146.0 Miles of sidewalks14.014.014.0 Miles of trails23.023.023.0 Sewer: Miles of storm sewers65.065.065.0 Miles of sanitary sewers102.0102.0102.0 Number of lift stations292929 Water: Miles of watermains110.0110.0110.0 Number of wells777 Source: Various City departments 150 Table 17 Fiscal Year 2002200320042005200620072008 2222222 529350375375375842842 2,815300300365365750754 8233333 22232525252626 3444466 761717171717 1111111 146.0124.7102.4106.8108.1110.5111.3 14.010.510.523.023.825.226.7 26.041.539.954.055.159.364.8 65.060.160.160.161.663.664.5 102.0111.5111.5111.5113.0115.7117.0 29303030313131 110.0120.0120.0120.0122.6125.3128.9 8778101112 151 - 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