2020 New Hope ACFR
CITY OF NEW HOPE
NEW HOPE, MINNESOTA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED
DECEMBER 31, 2020
CITY OF NEW HOPE
HENNEPIN COUNTY, MINNESOTA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED
DECEMBER 31, 2020
KIRK MCDONALD - CITY MANAGER
PREPARED BY: DEPARTMENT OF FINANCE
Member GFOA of U.S. and Canada
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Page
INTRODUCTORY SECTION
LETTER OF TRANSMITTAL FROM CITY MANAGER i–vi
GFOA CERTIFICATE OF ACHIEVEMENT vii
ORGANIZATIONAL CHART viii
CITY COUNCIL AND OTHER OFFICIALS ix
FINANCIAL SECTION
INDEPENDENT AUDITOR’S REPORT 1–3
MANAGEMENT’S DISCUSSION AND ANALYSIS 4–14
BASIC FINANCIAL STATEMENTS
Government-Wide Financial Statements
Statement of Net Position 15
Statement of Activities 16–17
Fund Financial Statements
Governmental Funds
Balance Sheet 18–19
Reconciliation of the Balance Sheet to the Statement of Net Position 20
Statement of Revenue, Expenditures, and Changes in Fund Balances 21–22
Reconciliation of the Statement of Revenue, Expenditures, and
Changes in Fund Balances to the Statement of Activities 23
Statement of Revenue, Expenditures, and Changes in Fund Balances –
General Fund – Budget and Actual 24
Statement of Revenue, Expenditures, and Changes in Fund Balances –
Economic Development Authority Fund – Budget and Actual 25
Proprietary Funds
Statement of Net Position 26–29
Statement of Revenue, Expenses, and Changes in Net Position 30–31
Statement of Cash Flows 32–35
Notes to Basic Financial Statements 36–67
REQUIRED SUPPLEMENTARY INFORMATION
PERA – General Employees Retirement Fund
Schedule of City’s and Nonemployer Proportionate Share of Net Pension Liability 68
Schedule of City Contributions 68
PERA – Public Employees Police and Fire Fund
Schedule of City’s and Nonemployer Proportionate Share of Net Pension Liability 69
Schedule of City Contributions 69
Other Post-Employment Benefits Plan
Schedule of Changes in the City’s Total OPEB Liability and Related Ratios 70
Notes to Required Supplementary Information 71–76
CITY OF NEW HOPE
HENNEPIN COUNTY, MINNESOTA
Table of Contents
Page
SUPPLEMENTAL INFORMATION
Nonmajor Governmental Funds
Combining Balance Sheet 77
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 78
Nonmajor Special Revenue Funds
Subcombining Balance Sheet 79
Subcombining Statement of Revenues, Expenditures, and Changes in Fund Balances 80
Schedule of Revenues, Expenditures, and Changes in Fund Balances –
Solid Waste Management Fund – Budget and Actual 81
Nonmajor Capital Projects Funds
Subcombining Balance Sheet 82
Subcombining Statement of Revenues, Expenditures, and Changes in Fund Balances 83
Nonmajor Debt Service Funds
Subcombining Balance Sheet 84–85
Subcombining Statement of Revenues, Expenditures, and Changes in Fund Balances 86–87
General Fund
Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual 88–92
Internal Service Funds
Combining Statement of Net Position 93
Combining Statement of Revenues, Expenses, and Changes in Net Position 94
Combining Statement of Cash Flows 95
STATISTICAL SECTION (UNAUDITED)
Financial Trends
Net Position by Component 96–97
Changes in Net Position 98–101
Governmental Activities Tax Revenues by Source 102
Fund Balances of Governmental Funds 103–104
Changes in Fund Balances of Governmental Funds 105–106
General Government Tax Revenues by Source 107
Revenue Capacity
Tax Capacity, Market Value, and Estimated Actual Value of Taxable Property 108–109
Property Tax Rates – Direct and Overlapping Governments 110
Principal Property Taxpayers 111
Property Tax Levies and Collections 112
Debt Capacity
Ratios of Outstanding Debt by Type 113–114
Ratios of General Bonded Debt Outstanding 115
Direct and Overlapping Governmental Activities Debt 116
Legal Debt Margin Information 117–118
Pledged Revenue Coverage 119
Demographic and Economic Information
Demographic and Economic Statistics 120
Principal Employers 121
Operating Information
Full-Time Equivalent City Government Employees by Function 122–123
Operating Indicators by Function 124–125
Capital Asset Statistics by Function 126–127
CITY OF NEW HOPE
HENNEPIN COUNTY, MINNESOTA
Table of Contents (continued)
INTRODUCTORY SECTION
CITY OF NEW HOPE, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2020
THIS PAGE INTENTIONALLY LEFT BLANK
CITY O F NEW HOPE
4401 Xylon Avenue North • New Hope, Minnesota 55428-4898 • www.ci.new-hope.rrm.us
City Hall: 763-531-5100 • Police (non-emergency): 763-531-5170 • Public Works: 763-592-6777 • TDD: 763-531-5109
City Hall Fax: 763-531-5136 • Police Fax: 763-531-5174 • Public Works Fax: 763-592-6776
May 14, 2021
Honorable Mayor and City Council
City of New Hope
4401 Xylon Avenue North
New Hope, MN 55428-4898
The Comprehensive Annual Financial Report of the City of New Hope, Minnesota (the City), for the fiscal year ended
December 31, 2020, is submitted herewith. As required by state law, this report is published annually, prior to June 30,
and submitted to the Office of the State Auditor. The form and contents of this report and the accompanying financial
statements and statistical tables are designed to meet the needs of a broad spectrum of financial statement readers, and
were prepared in conformance with standards set forth by:
1. The Governmental Accounting Standards Board (GASB)
2. The American Institute of Certified Public Accountants
3. The United States Office of Management and Budget
4. The State Auditor, State of Minnesota
5. The Government Finance Officers’ Association (GFOA) of the United States and Canada
The financial data presented in this report was prepared by the City ’s finance department staff. The responsibility for
the accuracy of the presented data and the completeness and fairness of the presentation, including all disclosures,
rests with the City. We believe the data as presented is accurate in all material respects and is presented in a manner
designed to fairly set forth the financial activity of the various funds, and that all disclosures necessary to enable the
reader to gain the maximum understanding of the City’s financial activity have been included.
Accounting principles generally accepted in the United States of America require that management provide a narrative
introduction, overview, and analysis to accompany the basic fina ncial statements in the form of the management’s
discussion and analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read
in conjunction with it. The City’s MD&A can be found immediately following the report of the independent auditors.
PROFILE OF THE GOVERNMENT
The City is a residential suburb of the City of Minneapolis with a population of 22,376. The City is 5.6 square miles
in area and is fully developed. The City was incorporated in 1953 and enjoys a diverse commercial and residential tax
base.
The City operates under the “Optional Plan B” government structure as defined in Minnesota Statutes. Optional Plan B
is known as the council-manager plan. Under this plan, as specified in the statutes, “The City Council shall exercise
the legislative power of the City and determine all matters of policy . The city manager shall be the head of the
administrative branch of the City government and shall be responsible to the City Council for the proper administration
of all affairs relating to the City.” The City Council is composed of five members, including the mayor . The city
manager is appointed by the City Council.
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The City’s accounting system is organized and operated on a “fund basis.” Each fund is a distinct self-balancing
accounting entity. The City’s accounting records for governmental fund types are maintained on the modified accrual
basis and the accrual basis is utilized by proprietary funds, as defined in the notes to basic financial statements.
The City maintains a system of internal control that provides a reasonable assurance of accounting data reliability, and
the safeguarding of assets against loss from unauthorized use or disposition . The concept of reasonable assurance
recognizes the cost of control should not exceed the benefits likely to be derived, and the evaluation of costs and
benefits requires estimates and judgments by management.
Budgets are maintained for the General Fund and certain special revenue funds (as noted in the notes to basic financial
statements). The city manager is directed to submit an annual budget to the City Council. Upon adoption of the annual
budget resolution by the City Council, it becomes the formal budget for city operations. Any changes to the original
budget have to be authorized by City Council action, but must maintain a balanced budget by either recognizing
additional receipts or utilizing fund balances.
Budget controls are maintained through a system of purchase orders and monthly financial statements, which compare
actual performance with the budget.
The City has reviewed its reporting entity definition in light of the GASB pronouncements. The entities included in
the City’s report are those for which the City has financial accountability.
Blended component units, although legally separate entities, are, in substance, part of the prim ary government’s
operations and are included as part of the primary government . Accordingly, the Economic Development Authority
(EDA) is reported as special revenue fund of the primary government and the Housing and Redevelopment Authority
(HRA) reports a debt service fund and a capital projects fund within the primary government.
The City provides a full range of municipal services, including: police and fire protection , culture and recreation,
public improvements, street maintenance, sanitary and storm sewer collection, water distribution, planning, zoning
and building inspection services, and general administrative services.
ECONOMIC OUTLOOK
The City is a nearly fully developed community with little vacant land available for development. The City has a good
mix of single/multi-family residential housing stock, parks and open space, and a strong commercial/industrial tax
base.
There are approximately 480 commercial/industrial/service businesses in the City, and the major employers are listed
as follows:
Major Employers Products/Services New Hope Based Employees
(Total Employees)
Independent School District No. 281 Education 791 (1,852)
Hy-Vee Grocery and convenience store 632
Minnesota Masonic Home/ North Ridge Care Center Skilled nursing care facility 560
St. Therese Home of New Hope Skilled nursing care facility 544 (1,117)
Horwitz Mechanical contractor 345
Perrigo Company Pharmaceutical and medicine
manufacturing 323
Intermediate District No. 287 Education 266 (943)
City of New Hope Government agency 262 (including seasonal staff)
YMCA Health club 228
Liberty Diversified International Stationery supplies 200
The City has four major industrial park areas including Science Industry Park, 49th and Quebec Avenues, Winnetka
Avenue area between 32nd and 36th Avenues, and north of Medicine Lake Road on Nevada Avenue.
The major shopping centers/areas in the City include: Midland Shopping Center, Winnetka Commons Shopping
Center, New Hope Mall, Winnetka Center, Post Haste Square, and the 42nd Avenue Redevelopment District.
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Business Assistance Programs
Local commercial/industrial businesses are extremely important to the City . The City Council has undertaken
programs and initiatives to address both commercial and industrial properties. These programs focus on: 1} retaining
existing businesses, 2} assisting with expansions, 3} attracting new businesses to vacant available buildings,
4} attracting new construction to a limited number of available vacant sites, and 5} improving communication with
businesses and responding more effectively to business concerns and inquiries . The City Council has continued the
Outstanding Business Award Program initiated in 2006, to recognize the City ’s businesses’ contributions to the local
community.
In 2009, the Business Networking Group forum was established to share information and improve communications
between businesses and the City and the forum continued through 20 20. The City is also a long-time member of the
TwinWest Chamber of Commerce. The City has also partnered with Hennepin County and Open to Business, a
company that provides free business advice and also provides gap financing .
In 2020, $27,832,249 of reinvestment was approved in the City in construction permits. The City will work to increase
the momentum to continually expand the tax base while continuing to provide the high level of services delivered to
the residents, businesses, and property owners of the City.
PLANNING AND DEVELOPMENT
The following planning and development activities occurred in 2020:
New Hope Aquatic Center
A new police department and City Hall for the City opened in July 2019. The pool that was previously located where
the new police department and City Hall were constructed was demolished and reconstructed in the area of the former
City Hall. In June 2018, the City Council voted on a preferred pool concept and entered into an agreement with Stantec
Engineering to provide the final planning and design. The preferred pool concept included a current channel, two body
slides, a shallow water area, and a 50-meter, 8-lane pool with diving boards. The original concept had a 25-yard pool;
however, during the 2018 legislative session the City received $2 million in order to expand the 25-yard pool concept
to 50 meters. Construction on the pool began in April 2019 and was completed in 2020. The pool is scheduled to open
in 2021.
Windsor Ridge
SVK Development is constructing 32 new single-family homes on an 8.7-acre undeveloped site that was owned by
the City for many years. In the fall of 2018, the City received six proposals from four developers for the site . After
careful consideration, SVK Development was selected as the preferred developer for the site . SVK Development is in
the process of developing 32 new single-family homes on 65-foot-wide lots. The estimated sales prices for the homes
range from the mid-$300,000’s to the low $400,000’s. As of early 2021, a total of 12 homes had sold for an average
price of $408,000. It is anticipated that all homes will be constructed by the end of 2021.
Pocket Square Cocktail Lounge
A. Davis Distillery received a conditional use permit in January 2020 to open a micro distillery and cocktail room at
7530 Quebec Avenue North. The distillery plans to serve hand-crafted cocktails and small 750 ml bottles of their
handmade liquor. The micro distillery will begin by selling primarily vodka, gin, and possibly rum, all of which will
be produced on-site. Although the cocktail room will not offer food, customers will be encouraged to order food from
local restaurants and there will be food trucks on location during some occasions . Pocket Square Cocktail Lounge is
one of the first cocktail rooms to open in the northwest suburbs.
ORIJIN STONE
ORIJIN STONE, a direct-to-trade natural stone wholesaler, relocated their operations and staff of 28 people to New
Hope in October of 2020. The business is known for its innovation in the stone industry, premium quality, and
exclusive natural stone products from around the world. After purchasing the vacant 110,000-square foot building at
5100 Boone Avenue North in February 2020, ORIJIN STONE constructed a state-of-the-art custom fabrication facility
for natural stone. The renovated space includes a new showroom, remodeled office space, and a reconfigured
warehouse. Interior improvements to the building included new skylights and roofing, mechanical and heating
systems, plumbing and bathrooms, breakrooms, overhead doors, cranes, windows and doors, concrete flooring, and
significant repairs to the building. Exterior upgrades included the construction of a new 32-stall parking lot, new
lighting and fencing, structural repairs, and painting of the building . The family run business started in 2011 and the
new location will allow for continued growth and expansion.
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Twin City Garage Door
Twin City Garage Door completed a $500,000 remodel and expansion of their office and showroom at 5601 Boone
Avenue North. The colorful, innovative design showcases Twin City Garage Door ’s products and includes working
examples throughout the project showroom . The full-service garage door company has three locations in the Twin
Cities. They provide overhead garage door installation and repair services, as well as garage door opener and electrical
control device services for commercial, industrial, and residential properties.
Housing
The City’s commitment to maintaining its housing stock is supported through a variety o f cooperative projects and
programs. Approximately $10,640,000 was reinvested in the City’s housing stock in 2020 for private home
construction, additions, and/or remodeling projects.
1. Housing rehabilitation programs:
a. Community Development Block Grant (CDBG) Housing Rehabilitation Program - administered by
Hennepin County:
i. CDBG funded activity in 2020 continued the expenditure of previously allocated CDBG
funds. The City contributed $76,250 in funds towards the acquisition of 8720 47th Avenue
North by Habitat for Humanity. The home will be rehabilitated in 2021.
ii. The City continued to operate their scattered site housing program by acquiring multiple
properties for demolition and new construction. Since 2014, the Economic Development
Authority has acquired 17 properties, resulting in the creation of 21 lots. The lots purchased
by the City are located at 7215, 7303, 7311, and 9121 62nd Avenue North, 4511 Boone
Avenue North, 3751, 4215, and 6065 Louisiana Avenue North, 3856 Maryland Avenue
North, 4415 Nevada Avenue North, 5201 and 5355 Oregon Avenue North,
5213 Pennsylvania Avenue North, 5431 Virginia Avenue North, 6027 and 6059 West
Broadway, and 5400 Yukon Avenue North. Four of the lots were large enough to split into
two buildable lots and were sold to developers for the construction of two new
single-family, owner-occupied homes. The City has two other properties under contract for
purchase.
b. Rehabilitation Re-sell:
i. The City has purchased two distressed properties for rehabilitation in the last five years .
The City chose to rehabilitate the home at 3984 Zealand Avenue North as it was too
valuable to demolish. It sold for $295,000. The City also acquired the property at
3924 Utah Avenue North in 2018 and coordinated a rehabilitation project valued at more
than $180,000. The home sold for $375,000 in 2020. The City has a goal of breaking even
on such projects and will invest all available resources into the home to create the highest
valued product possible.
2. Housing maintenance programs
a. Code compliance inspections – 971 inspections completed in 2020.
b. Rental housing program and inspections:
i. A rental registration permit program, which requires the registration and inspection of all
rental units in the City, was implemented in 2006 for single-family and 2007 for
multi-family units.
ii. A total of 545 single-family rental units are registered with the City.
iii. A total of 3,776 multi-family rental units are registered with the City.
c. Multifamily Property Manager’s Association – quarterly meetings.
d. Partnership with Center for Energy and Environment and Hennepin County for fix-up loans and
grants.
3. Metropolitan Council Livable Communities Act – annually renewed by the City.
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PARKS AND RECREATION
The City continues to provide its residents with a vast array of park amenities and recreation opportunities at an
affordable cost. In 2020, the City maintained 18 parks, four additional school district parks (summer only), two sheets
of indoor ice at the ice arena, and a par 3 nine-hole golf course. In addition, the City programs the New Hope
Community Gyms during nonschool time.
The year started off strong with registrations, rentals, and use; however, COVID-19 greatly impacted the majority of
the year. In mid-March, all programs were cancelled and facilities closed for a couple of months due to the direction
of the Governor. When the City was able to start to re-open in early summer, there were guidelines in place that
severely limited facility operations and programs. Staff worked to create Preparedness Plans, train staff, and adapt
programs and facility operations in order to offer programming, including virtual programs . Due to the stringent
guidelines, the aquatic park opening was postponed until 2021 . In mid-November, the Governor once again closed
programs and facilities, which lasted through the end of the year .
The golf course was the only facility that continued to offer leagues, lessons, a limited number of tournaments, and
open golf during the majority of the COVID-19 pandemic. However, most of the clubhouse rentals and picnic pavilion
rentals were cancelled due to the limitations. The Governor allowed golf course maintenance to start on April 13 and
for courses to open on April 18, if COVID -19 safety plans were in place. It was an extremely busy year for the golf
course. The number of golf rounds increased 57 percent from 2019, it was a 15-year high for the number of rounds
played and a 20-year high for revenue. In 2020, additional ventilation was added in the concession equipment room,
year 2 of the 5-year lease for golf carts continued , and landscaping was added around the new patio. The parking
agreement continued with Ironwood Apartments for the use of 16 golf course parking lot spaces overnight .
During 2020, several park projects took place including the replacement of the playground at Begin Park, court
resurfacing of the tennis courts at Civic Center Park and basketball court at Fred Sims Park, crack filling of the
basketball and tennis courts at Hidden Valley Park, replacement of the basketball court at Northwood Park, addition
of fencing at Liberty Park hockey rink, and the reclaim and overlay of the trails along the south side of the tennis
courts and south parking lot at Civic Center Park. In addition, engineered wood fiber was added to several playgrounds
and staff purchased new picnic tables for the Civic Center Park picnic pavilion . Buckthorn removal was continued in
several parks and new signage was installed at Begin and Victory parks. During the 2019–2020 winter season, parks
staff continued to plow a section of trail at Hidden Valley, Northwood , and Lions parks and maintain outdoor skating
areas at Hidden Valley, Lions, and Liberty parks.
Work on the Civic Center Park amenities and New Hope Aquatic Park continued. The skatepark components were
finalized in early 2020 and available for use most of the year. The performance center was complete by the middle of
the summer and some programming took place toward the end of the summer and early fall, including a cou ple of
Movies in the Park and a Halloween event. Due to the construction timing, the Off Broadway Musical Theater
performances were not scheduled in 2020, but are expected to return in 2021 . Installation of trails, lighting, parking
lots, landscaping, grading, and seeding of the park area took place throughout the year. The final work will take place
in 2021. Since the Aquatic Park did not open due to COVID-19, work continued through mid-summer with the final
punch list items planned for completion by opening day in 2021.
When allowed to be open, the ice arena offered ice time for youth, adult recreational, league hockey, open skating ,
and skating lessons. In addition, the three compressors were rebuilt, system relief valves were replaced, and new skate
sharpening machines were purchased. The advertising agreement and concession stand agreement continued with the
Armstrong Cooper Youth Hockey Association and the dryland training agreement continued with Charleston
Overspeed; however, due to COVID-19 restrictions, these agreements were temporarily suspended from mid -March
through December.
PROPERTY TAX PROCESS
Preliminary tax levies have to be sent to the county auditor by September 30th. This levy can be lowered at a later
date, but cannot be increased. The county sends out notices to all property owners informing them of proposed property
taxes and the dates of public hearings by the various taxing districts . The final budget is adopted by the City in
December at a City Council meeting after the public hearing.
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OTHER PERTINENT INFORMATION
Independent Audit – As required by Minnesota Statutes, city policy requires an annual audit of all city accounts to be
made by independent certified public accountants selected by the City Council. This requirement has been complied
with and the opinion of Malloy, Montague, Karnowski, Radosevich & Co., P.A. (MMKR) is included with this report.
Claims and Litigation – The City had the usual and customary types of miscellaneous claims pending at year-end,
mostly of a minor nature and entirely covered by insurance carried for that purpose.
Long-term Financial Planning – Management provided a long-term plan to City Council in 2019 that will highlight
the tax effect of major capital and operating decisions. This will also be an important document when preparing future
budgets.
AWARDS AND ACKNOWLEDGEMENTS
The GFOA awarded a Certificate of Achievement for Excellence in Financial Reporting to the City for its
Comprehensive Annual Financial Report for the fiscal year ended December 31, 2019. This was the 12th consecutive
year that the government has achieved this prestigious award . In order to be awarded a Certificate of Achievement, a
government must publish an easily readable and efficiently organized Comprehensive Annual Financial Report. This
report must satisfy both generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only . We believe that our current Comprehensive Annual
Financial Report continues to meet the Certificate of Achievement Program’s requirements and we are submitting it
to GFOA to determine its eligibility for another certificate.
Preparation of this report could not have been accomplished without the professional, efficient, and dedicated services
of the entire staff of the Department of Finance, AEM Financial Solutions, LLC (the City’s contracted finance director)
other city departments, and the staff of MMKR.
We wish to express our appreciation to all the contributors for their efforts to complete this report .
Respectfully submitted,
Kirk McDonald
City Manager
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of New Hope
Minnesota
For its Comprehensive Annual
Financial Report
For the Fiscal Year Ended
December 31, 2019
Executive Director/CEO
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Term Expires
Kathi Hemken Mayor 12/31/2020
John Elder Councilmember 12/31/2022
Cedrick Frazier Councilmember 12/31/2020
Andrew Hoffe Councilmember 12/31/2020
Jonathan London Councilmember 12/31/2022
Kirk McDonald City Manager Appointed
Bernie Weber Director of Public Works Appointed
Jeff Sargent Director of Community Development Appointed
Susan Rader Director of Parks and Recreation Appointed
Tim Hoyt Chief of Police Appointed
Rich Johnson Director of Human Resources and Administrative Services Appointed
Valerie Leone City Clerk Appointed
CITY COUNCIL
CITY OFFICIALS
CITY OF NEW HOPE
HENNEPIN COUNTY, MINNESOTA
City Council and Other Officials
Year Ended December 31, 2020
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FINANCIAL SECTION
CITY OF NEW HOPE, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2020
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INDEPENDENT AUDITOR’S REPORT
To the City Council and Management
City of New Hope, Minnesota
REPORT ON THE FINANCIAL STATEMENTS
We have audited the accompanying financial statements of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information of the City of New Hope,
Minnesota (the City) as of and for the year ended December 31, 2020, and the related notes to the financial
statements, which collectively comprise the City’s basic financial statements as listed in the table of
contents.
MANAGEMENT’S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes the
design, implementation, and maintenance of internal control relevant to the preparation and fair presentation
of financial statements that are free from material misstatement, whether due to fraud or error.
AUDITOR’S RESPONSIBILITY
Our responsibility is to express opinions on these financial statements based on our audit . We conducted
our audit in accordance with auditing standards generally accepted in the United States of America and the
standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor’s judgment, including the assessment
of the risks of material misstatement of the financial statements, whether due to fraud or error . In making
those risk assessments, the auditor considers internal control relevant to the City’s preparation and fair
presentation of the financial statements in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal
control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of significant accounting estimates made by management,
as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinions.
(continued)
C E R T I F I E D
A C C O U N T A N T S
P UBLIC
PRINCIPALS
Thomas A. Karnowski, CPA
Paul A. Radosevich, CPA
William J. Lauer, CPA
James H. Eichten, CPA
Aaron J. Nielsen, CPA
Victoria L. Holinka, CPA/CMA
Jaclyn M. Huegel, CPA
Kalen T. Karnowski, CPA
Malloy, Montague, Karnowski, Radosevich & Co., P.A.
5353 Wayzata Boulevard • Suite 410 • Minneapolis, MN 55416 • Phone: 952-545-0424 • Fax: 952-545-0569 • www.mmkr.com
Standard Letterhead-r2.qxp_167639 Letterhead-RV1 9/7/18 6:34 PM Page 1
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OPINIONS
In our opinion, the financial statements referred to on the previous page present fairly, in all material
respects, the respective financial position of the governmental activities, the business-type activities, each
major fund, and the aggregate remaining fund information of the City at December 31, 2020, and the
respective changes in financial position and, where applicable, cash flows thereof, and the budgetary
comparisons for the General Fund and Economic Development Authority Special Revenue Fund for the
year then ended, in accordance with accounting principles generally accepted in the United States of
America.
OTHER MATTERS
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s
discussion and analysis and the required supplementary information (RSI), as listed in the table of contents,
be presented to supplement the basic financial statements. Such information, although not a part of the basic
financial statements, is required by the Governmental Accounting Standards Board, who considers it to be
an essential part of financial reporting for placing the basic financial statements in an appropriate
operational, economic, or historical context. We have applied certain limited procedures to the RSI in
accordance with auditing standards generally accepted in the United States of America, which consisted of
inquiries of management about the methods of preparing the information and comparing the information
for consistency with management’s responses to our inquiries, the basic financial statements, and other
knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or
provide any assurance on the information because the limited procedures do not provide us with sufficient
evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the City’s basic financial statements. The introductory section, supplemental information, and
statistical section, as listed in the table of contents, are presented for purposes of additional analysis and are
not required parts of the basic financial statements.
The supplemental information is the responsibility of management and was derived from and relates
directly to the underlying accounting and other records used to prepare the basic financial statements . Such
information has been subjected to the auditing procedures applied in the audit of the basic financial
statements and certain additional procedures, including comparing and reconciling such information
directly to the underlying accounting and other records used to prepare the basic financial statements or to
the basic financial statements themselves, and other additional procedures in accordance with auditing
standards generally accepted in the United States of America. In our opinion, the supplemental information
is fairly stated, in all material respects, in relation to the basic financial statements as a whole.
The introductory and statistical sections have not been subjected to the auditing procedures applied in the
audit of the basic financial statements and, accordingly, we do not express an opinion or provide any
assurance on them.
(continued)
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OTHER REPORTING REQUIRED BY GOVERNMENT AUDITING STANDARDS
In accordance with Government Auditing Standards, we have also issued our report dated May 14, 2021 on
our consideration of the City’s internal control over financial reporting and on our tests of its compliance
with certain provisions of laws, regulations, contracts, grant agreements, and other matters. The purpose of
that report is solely to describe the scope of our testing of internal control over financial reporting and
compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s
internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the City’s internal control
over financial reporting and compliance.
Minneapolis, Minnesota
May 14, 2021
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CITY OF NEW HOPE
Management’s Discussion and Analysis
Year Ended December 31, 2020
-4-
As management of the City of New Hope, Minnesota (the City), we have provided readers of the City’s
financial statements with this narrative overview and analysis of the financial activities of the City for the
fiscal year ended December 31, 2020. We encourage readers to consider the information presented here in
conjunction with additional information that we have furnished in our letter of transmittal, located earlier
in this report.
FINANCIAL HIGHLIGHTS
• The assets and deferred outflows of resources of the City exceeded its liabilities and deferred
inflows of resources at the close of the most recent fiscal year by $85,039,129 (net position). Of
this amount, $24,251,116 (unrestricted net position) may be used to meet the City’s ongoing
obligations to citizens and creditors.
• The City’s total net position increased by $7,841,398. This was a result of governmental activities
and business type activities increasing net position by $5,347,578 and $2,493,820, respectively.
• As of the close of the current fiscal year, the City’s governmental funds reported combined
ending fund balances of $27,455,251, a decrease of $1,795,737 in comparison with the prior year.
Approximately 24.7 percent of this total amount, $6,781,656, is available for spending at the
City’s discretion (unassigned fund balance).
• At the end of the current fiscal year, unassigned fund balance for the General Fund was
$8,901,587, or 63.0 percent, of total General Fund 2020 expenditures and transfers out.
• The City’s total bonded debt decreased by $2,612,989 (4.6 percent) during the current fiscal year.
OVERVIEW OF THE FINANCIAL STATEMENTS
The management’s discussion and analysis is intended to serve as an introduction to the City’s basic
financial statements, which are comprised of three components: 1) government-wide financial statements,
2) fund financial statements, and 3) notes to basic financial statements. This report also contains other
supplementary information in addition to the basic financial statements.
The financial statements include notes that explain some of the information in the financial statements
and provide more detailed data. The statements are followed by a section of combining and individual
fund financial statements and schedules which further explain and support the information in the financial
statements.
-5-
Figure A shows how the various parts of this annual report are arranged and related to one another.
Management’s
Discussion and
Analysis
Basic Financial
Statements
Required
Supplementary
Information
Government-Wide
Financial Statements
Fund Financial
Statements
Notes to Basic
Financial Statements
Summary Detail
Figure A
Required Components of the City’s
Comprehensive Annual Financial Report
Government-Wide Financial Statements – The government-wide financial statements are designed to
provide readers with a broad overview of the City’s finances, in a manner similar to private sector
businesses.
The Statement of Net Position presents information on all of the City’s assets, deferred outflows of
resources, liabilities, and deferred inflows of resources, with the difference reported as net position. Over
time, increases or decreases in net position may serve as a useful indicator of whether the financial
position of the City is improving or deteriorating.
The Statement of Activities presents information showing how the City’s net position changed during the
most recent fiscal year. All changes in net position 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
(uncollected taxes and earned but unused vacation leave).
Both of the government-wide financial statements distinguish functions of the City that are principally
supported by taxes and intergovernmental revenues (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 include general government, public safety, public works, culture
and recreation, economic development, and interest on long-term debt. The business-type activities of the
City include sewer utility, water utility, golf course, ice arena, storm water, and street lighting.
Fund Financial Statements – A fund is a grouping of related accounts that is used to maintain control
over resources segregated for specific activities or objectives. The City, like other local governments, uses
fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the
funds of the City can be divided into two categories: governmental funds and proprietary funds.
-6-
Governmental Funds – Governmental funds 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, and the balances of spendable resources available at the
fiscal year-end. Such information may be useful in evaluating a government’s near-term financing
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 government’s near-term financing
decisions. Both the governmental funds Balance Sheet and Statement of Revenue, Expenditures, and
Changes in Fund Balances provide a reconciliation to facilitate the comparison between governmental
funds and governmental activities.
The City maintains several individual governmental funds. Information is presented separately in the
governmental fund Balance Sheet and the governmental fund Statement of Revenues, Expenditures, and
Changes in Fund Balances for the General, Economic Development Authority, HRA Construction, City
Hall CIP, Street Infrastructure, Park/Pool Improvement Project, and HRA Bonds funds, all of which are
considered to be major funds. Data from the remaining 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 or schedules elsewhere in this report.
The City adopts annual appropriated budgets for its General Fund and the Economic Develo pment
Authority and Solid Waste Management Special Revenue Funds. A budgetary comparison statement has
been provided for these funds to demonstrate compliance with the adopted budgets.
Proprietary Funds – The City maintains two different types of proprietary funds. Enterprise funds are
used to report the same functions presented as business-type activities in the government-wide financial
statements. The City uses enterprise funds to account for its sewer utility, water utility, golf course, ice
arena, storm water, and street lighting operations. Internal service funds are an accounting device used to
accumulate and allocate costs internally among the City’s various functions. The City uses internal
service funds to account for distribution of vehicle and equipment costs, government-wide costs of
insurance coverage and employee leave, and information technology cost allocation. Because all of these
services predominately benefit governmental rather than business-type functions, they have been included
within governmental activities in the governmental-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 each of the
enterprise funds, all of which are considered to be major funds of the City. Internal service funds are
combined into a single, aggregated presentation in the proprietary fund financial statements. Individual
fund data for the internal service funds is provided in the form of combining statements elsewhere in this
report.
Notes to Basic Financial Statements – The notes to basic financial statements provide additional
information that is essential to a full understanding of the data provided in the government-wide and fund
financial statements.
Other Information – Required supplementary information (RSI) on the City’s other post-employment
benefit and pension plans is presented following the notes to basic financial statements. Combining and
individual fund statements and schedules for nonmajor funds, along with other city information, are
presented as supplemental information immediately following the RSI. Statistical tables are presented as
the last section in this report.
The statistical section presents information as a context for understanding what the information in the
financial statements, note disclosures, and required supplementary information says about the City’s
overall financial health. The information in the statistical section is not audited.
-7-
GOVERNMENT-WIDE FINANCIAL ANALYSIS
As noted earlier, changes in net position may serve over time as a useful indicator of the City’s financial
condition. The City’s assets and deferred outflows of resources exceeded its liabilities and deferred
inflows of resources by $85,039,129 at the end of the 2020 fiscal year.
A portion of the City’s net position (60.5 percent) reflects its investment in capital assets (e.g., land,
buildings, vehicles and equipment); less any related debt used to acquire those assets that is still
outstanding. The City uses these capital assets to provide services to citizens; consequent ly, these assets
are not available for future spending. Although the City’s investment in its capital assets is reported net of
related debt, it should be noted that the resources needed to repay this debt must be provided from other
sources, since the capital assets themselves cannot be used to liquidate these liabilities.
The following is a summary of the City’s net position at the end of the last two fiscal years:
2020 2019 2020 2019 2020 2019
Current and other assets 42,638,781$ 46,558,017$ 8,102,748$ 5,932,881$ 50,741,529$ 52,490,898$
Capital assets, net of depreciation 73,333,910 68,293,237 29,336,500 29,058,223 102,670,410 97,351,460
Total assets 115,972,691 114,851,254 37,439,248 34,991,104 153,411,939 149,842,358
Deferred outflows of resources
Deferred pension resources 2,315,482 4,422,526 99,031 73,354 2,414,513 4,495,880
Deferred other postemployment benefit resources 167,973 119,013 28,471 24,733 196,444 143,746
Total deferred outflows of resources 2,483,455 4,541,539 127,502 98,087 2,610,957 4,639,626
Long-term liabilities
(including current portion)53,540,307 54,561,626 10,321,457 10,650,831 63,861,764 65,212,457
Other liabilities 1,762,636 3,763,982 980,838 568,736 2,743,474 4,332,718
Total liabilities 55,302,943 58,325,608 11,302,295 11,219,567 66,605,238 69,545,175
Deferred inflows of resources
Deferred pension resources 2,882,251 5,499,493 37,066 134,165 2,919,317 5,633,658
Deferred other postemployment benefit resources 33,203 36,169 5,628 7,518 38,831 43,687
Resources received in advance 1,420,381 2,061,733 – – 1,420,381 2,061,733
Total deferred inflows of resources 4,335,835 7,597,395 42,694 141,683 4,378,529 7,739,078
Net position
Net investment in capital assets 31,359,813 30,139,510 20,127,288 19,315,353 51,487,101 49,454,863
Restricted 7,740,859 6,628,138 1,560,053 1,358,401 9,300,912 7,986,539
Unrestricted 19,716,696 16,702,142 4,534,420 3,054,187 24,251,116 19,756,329
Total net position 58,817,368$ 53,469,790$ 26,221,761$ 23,727,941$ 85,039,129$ 77,197,731$
Governmental Activities Business-Type Activities Total
An additional portion of the City’s net position, $9,300,912, represents resources that are subject to
external restrictions on how they may be used. The remaining balance of unrestricted net position,
$24,251,116, may be used to meet the City’s ongoing obligations to citizens and creditors.
At the end of the current fiscal year, the City is able to report a positive balance in all three categories of
net position for both the governmental activities and the business-type activities. This was also the case at
the previous year-end.
-8-
The following table indicates the changes in net position for the City’s governmental and business-type
activities:
2020 2019 2020 2019 2020 2019
Revenues
Program revenues
Charges for services 1,504,128$ 1,860,001$ 11,627,850$ 10,587,884$ 13,131,978$ 12,447,885$
Operating grants and
contributions 866,861 826,489 110,331 14,308 977,192 840,797
Capital grants and
contributions 1,048,750 2,819,823 12,922 28,824 1,061,672 2,848,647
General revenues
Property taxes 16,821,240 15,265,428 – – 16,821,240 15,265,428
Tax increments 1,918,857 1,317,803 – – 1,918,857 1,317,803
Franchise taxes 958,162 957,448 – – 958,162 957,448
Grants and contributions not
restricted to specific programs 2,497,630 803,035 – – 2,497,630 803,035
Investment earnings 781,304 1,412,308 137,468 149,296 918,772 1,561,604
Gain on sale of capital assets 22,000 369,163 – – 22,000 369,163
Total revenues 26,418,932 25,631,498 11,888,571 10,780,312 38,307,503 36,411,810
Expenses
General government 2,945,625 1,850,242 – – 2,945,625 1,850,242
Public safety 8,968,009 8,540,198 – – 8,968,009 8,540,198
Public works 3,725,075 3,816,417 – – 3,725,075 3,816,417
Culture and recreation 2,270,751 2,145,988 – – 2,270,751 2,145,988
Economic development 1,350,348 749,651 – – 1,350,348 749,651
Interest on long-term debt 1,570,807 1,412,763 – – 1,570,807 1,412,763
Sewer utility – – 3,096,526 2,834,973 3,096,526 2,834,973
Water utility – – 4,195,981 3,762,099 4,195,981 3,762,099
Golf course – – 316,173 319,871 316,173 319,871
Ice arena – – 1,016,296 1,003,048 1,016,296 1,003,048
Storm water – – 877,244 888,156 877,244 888,156
Street lighting – – 133,270 116,732 133,270 116,732
Total expenses 20,830,615 18,515,259 9,635,490 8,924,879 30,466,105 27,440,138
Change in net position
before transfers 5,588,317 7,116,239 2,253,081 1,855,433 7,841,398 8,971,672
Transfers – internal activities (240,739) (144,624) 240,739 144,624 – –
Change in net position 5,347,578 6,971,615 2,493,820 2,000,057 7,841,398 8,971,672
Net position
Beginning 53,469,790 46,498,175 23,727,941 21,727,884 77,197,731 68,226,059
Ending 58,817,368$ 53,469,790$ 26,221,761$ 23,727,941$ 85,039,129$ 77,197,731$
TotalGovernmental Activities Business-Type Activities
Governmental activities increased the City’s net position by $5,347,578 in 2020, while business -type
activities increased net position by $2,493,820. The increase in general government expense of
$1,095,383 was mainly due to a loss on the disposal of the old City Hall building and improvements. The
increase in economic development expense of $600,697 was a result of a loss on the sale of remaining
land held for resale. Capital grants and contributions decreased from the prior year by $1,771,073, mainly
due to the City utilizing about $1.9 million of a $2.0 million grant to cover part of the outdoor pool
project costs in the prior year. The decrease in capital grants and contributions was offset by increases in
property taxes levied of $1,555,812 and grants and contributions not restricted to specific programs of
$1,694,595, primarily from recognition of approximately $1.6 million of federal coronavirus relief funds.
-9-
Governmental Activities – Governmental activities net position increased by $5,347,578. The following
graphs illustrate the City’s revenues and expenses for its governmental activities:
Expenses and Program Revenues – Governmental Activities
$–
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
$9,000,000
$10,000,000
General
Government
Public Safety Public Works Culture and
Recreation
Economic
Development
Interest and
Fiscal Charges
Expenses Program Revenues
Revenue by Source – Governmental Activities
-10-
Business-Type Activities – The net position of business-type activities increased by $2,493,820. This
increase was primarily the result of operating net income in the Sewer Utility, Water Utility, and Storm
Water Funds of $593,340, $961,383, and $373,686, respectively.
Below are the graphs showing the business-type activities revenue and expense comparisons:
Expenses and Program Revenues – Business-Type Activities
$–
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
$4,500,000
$5,000,000
$5,500,000
$6,000,000
Sewer Utility Water Utility Golf Course Ice Arena Storm Water Street
Lighting
Expenses Program Revenues
Revenue by Source – Business-Type Activities
-11-
FINANCIAL ANALYSIS OF THE CITY’S FUNDS
Governmental Funds
The focus of the City’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’s financing
requirements. In particular, unassigned fund balance may serve as a useful measure of a government’s net
resources available for spending at the end of the fiscal year.
As of the end of the current fiscal year, the City’s governmental funds had combined ending fund
balances of $27,455,251, a decrease of $1,795,737 in comparison with the prior year. Approximately
24.7 percent of this total amount, $6,781,656, constitutes unassigned fund balance, which is available for
spending at the City’s discretion. The remainder of fund balance is either not available for new spending,
or available for new spending, but limited in use, because it is either 1) nonspendable ($24,499),
2)restricted ($9,016,306), 3) committed ($4,639,390), or 4) assigned ($6,993,400).
General Fund – The fund balance of the General Fund increased by $1,786,383 to $8,926,086 at
December 31, 2020. Unassigned fund balance represents 63.0 percent of total 2020 expenditures. The
increase in fund balance was mainly due to revenues exceeding current year operational costs.
Economic Development Authority – Fund balance decreased by $401,302 in 2020, due to the sale of
remaining land held for resale at a loss. The fund balance of $4,320,456 was committed for economic
development projects.
HRA Construction – This fund accounts for the activity within the City's Tax Increment Financing (TIF)
Districts, less resources accumulated elsewhere for TIF related long-term obligations. Fund balance
increased by $723,948, which is primarily result of increased in tax increment revenues from
improvements.
City Hall CIP – The decrease in fund balance of $576,934 is due to project expenditures in 2020.
Street Infrastructure – This fund accounts for capital outlay expenditures related to street infrastructure.
Fund balance increased $234,843 from the prior year. The increase was a result of revenues exceeding
current year project costs.
Park/Pool Improvement Project – The decrease in fund balance of $4,666,479 is due to project
expenditures in 2020.
HRA Bonds – The increase in fund balance of $124,294 is primarily related to tax increment revenues
exceeding debt service requirements and other expenditures in the fund.
Proprietary Funds – The City’s proprietary funds provide the same information for the business-type
activities found in the government-wide financial statements, but in more detail.
The City’s enterprise funds had a total net position of $26,479,383 at year-end, of which $4,792,042 was
unrestricted. The total net position of these funds improved by $2,294,461 during 2020. Other factors
concerning the finances of these funds have already been addressed in the discussion of the City’s
business-type activities.
-12-
General Fund Budgetary Highlights
The City’s General Fund budget was not amended during the year. Revenues and expenditures provided
positive budget variances. Actual revenues were over budget by $506,822 and expenditures were under
budget by $1,279,561. Revenue line items with significant budget variances include the following:
•Intergovernmental revenue was over budget by $1,756,383, mostly due to federal funding for
COVID-19-related costs.
•Charges for services revenue was under budget by $1,144,980, mainly due to budgeting for the
City’s new outdoor pool, which was expected to open for 2020, but was closed for the whole
year, due to COVID-19.
Expenditure line items with significant budget variances include the following:
•Public safety expenditures were under budget by $443,090, mostly in personnel services for the
police department, due to vacant positions.
•Culture and recreation expenditures were under budget by $846,975, primarily in swimming pool
budget to actual difference, which contributed to $597,306 of the variance. The pool was not open
in 2020 as anticipated. The remaining budget to actual difference was made up of underspending
in budgeted culture and recreation expenditures from the cancellation of various city programs
and activities, due to COVID-19 restrictions.
-13-
CAPITAL ASSETS AND LONG-TERM LIABILITIES
Capital Assets – The City’s investment in capital assets (net of accumulated depreciation) for its
governmental and business-type activities as of December 31, 2020 was $102,670,410, an increase of
$5,318,950 from the prior year. The City’s capital assets for the last two years are as follows:
2020 2019 2020 2019 2020 2019
Land 994,268$ 994,268$ 485,042$ 485,042$ 1,479,310$ 1,479,310$
Buildings and structures 25,408,669 9,367,855 10,797,364 10,912,208 36,206,033 20,280,063
Vehicles and equipment 10,531,390 10,839,831 2,505,156 2,635,207 13,036,546 13,475,038
Improvements other than buildings 47,227,137 46,133,939 28,522,699 27,865,215 75,749,836 73,999,154
Construction in progress 19,939,298 32,059,543 1,370,824 798,951 21,310,122 32,858,494
Less accumulated
depreciation (30,766,852) (31,102,199) (14,344,585) (13,638,400) (45,111,437) (44,740,599)
Net total 73,333,910$ 68,293,237$ 29,336,500$ 29,058,223$ 102,670,410$ 97,351,460$
Governmental Activities Business-Type Activities Total
The majority of the increase in capital assets was in building and structures, due to completion of City
Hall and police station projects. Additional details of the City’s capital asset activity for the year can be
found in Note 5 of the notes to basic financial statements.
Long-Term Liabilities – The debt service funds account for the accumulation of resources to finance all
of the City’s governmental activity general obligation debt. The revenue sources for these funds include
annual tax levies, tax increments, franchise taxes, and special assessments. At year-end, there was
$2,845,806 of fund balance restricted for debt service in the governmental funds. The lease revenue bonds
and G.O. revenue bonds will be paid from the designated business activity from Ice Arena, Sewer Utility,
Water Utility, and Storm Water Funds. The following table presents the City’s long-term liabilities as of
the last two year-ends:
2020 2019 2020 2019 2020 2019
GO. bonds and certificates 38,930,476$ 40,433,000$ 3,285,833$ 3,509,802$ 42,216,309$ 43,942,802$
G.O. tax increment bonds 6,005,590 6,582,397 1,307,253 1,401,536 7,312,843 7,983,933
Lease revenue bonds – – 3,505,000 3,505,000 3,505,000 3,505,000
G.O. revenue bonds and notes – – 1,111,126 1,326,532 1,111,126 1,326,532
Total 44,936,066$ 47,015,397$ 9,209,212$ 9,742,870$ 54,145,278$ 56,758,267$
TotalGovernmental Activities Business-Type Activities
The City achieved an “AA” rating from Standard & Poor’s. Additional details of long-term liabilities
activity for the year can be found in Note 6 of the notes to basic financial statements.
-14-
ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS AND RATES
Economic factors affect the preparation of annual budgets. The following factors were considered in
preparing the 2021 budget:
• User charges have been increased to account for various utility improvements scheduled for 2021
and beyond.
• The overall tax levy was reduced to a 3.4 percent increase for 2021, primarily related to no new
bonding for capital projects.
• Management provided a long-term plan to City Council in November that highlighted the tax
effect of major capital and operating decisions. This will be an important document when
preparing future budgets.
• The City dealt with the COVID-19 pandemic in a measured and forward-thinking manner,
balancing increased costs for public safety and the loss of revenue from fees, licenses, etc. with
reductions in spending, programming, and seasonal equipment. The City received approximately
$1.6 million in federal Coronavirus Aid, Relief, and Economic Security funding, which was
targeted for police and fire public safety costs.
REQUESTS FOR INFORMATION
This financial report is designed to provide a general overview of the City’s finances for all those with an
interest in the City’s finances. Questions concerning any of the information provided in this report or
requests for additional financial information should be addressed to the Department of Finance, City of
New Hope, 4401 Xylon Avenue North, New Hope, Minnesota 55428.
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GOVERNMENT-WIDE FINANCIAL STATEMENTS
CITY OF NEW HOPE, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2020
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City of New Hope, Minnesota
Statement of Net Position
December 31, 2020
Governmental Business-Type
Activities Activities Total
Assets
Cash and temporary investments 39,764,534$ 5,056,635$ 44,821,169$
Cash held with fiscal agent - 1,560,053 1,560,053
Receivables
Taxes 352,003 - 352,003
Accrued interest 65,631 - 65,631
Accounts 369,512 1,437,072 1,806,584
Loans 261,516 - 261,516
Special assessments 577,299 192,210 769,509
Internal balances 414,307 (414,307) -
Due from other governments 104,844 60,084 164,928
Inventories 68,035 42,492 110,527
Prepaid items 24,499 - 24,499
Investment in joint ventures 636,601 168,509 805,110
Capital assets
Land and construction in progress 20,933,566 1,855,866 22,789,432
Depreciable assets (net of accumulated deprecation)52,400,344 27,480,634 79,880,978
Total Assets 115,972,691 37,439,248 153,411,939
Deferred Outflows of Resources
Deferred pension resources 2,315,482 99,031 2,414,513
Deferred other post-employment benefit resources 167,973 28,471 196,444
Total Deferred Outflow of Resources 2,483,455 127,502 2,610,957
Liabilities
Accrued salaries payable 434,390 50,626 485,016
Accounts and contracts payable 658,964 325,749 984,713
Due to other governments 15,876 537,976 553,852
Accrued interest payable 625,111 62,931 688,042
Deposits payable 14,495 3,556 18,051
Unearned revenue 13,800 - 13,800
Noncurrent liabilities
Due within one year 2,633,231 537,115 3,170,346
Due in more than one year 43,146,291 8,672,097 51,818,388
Net pension liability – due in more than one year 6,650,322 924,026 7,574,348
Other post-employment benefits liability – due in more than one year 1,110,463 188,219 1,298,682
Total Liabilities 55,302,943 11,302,295 66,605,238
Deferred Inflows of Resources
Deferred pension resources 2,882,251 37,066 2,919,317
Deferred other post-employment benefit resources 33,203 5,628 38,831
Resources received in advance 1,420,381 - 1,420,381
Total Deferred Inflows of Resources 4,335,835 42,694 4,378,529
Net Position
Net investment in capital assets 31,359,813 20,127,288 51,487,101
Restricted for
Economic development 5,379,088 - 5,379,088
Debt service 2,220,695 1,560,053 3,780,748
Public safety police expenses 135,571 - 135,571
Ice arena 5,505 - 5,505
Unrestricted 19,716,696 4,534,420 24,251,116
Total Net Position 58,817,368$ 26,221,761$ 85,039,129$
See notes to basic financial statements -15-
Expenses
Charges for
Services
Operating
Grants and
Contributions
Capital Grants
and
Contributions
Governmental Activities
General government 2,945,625$ 217,183$ 103,086$ -$
Public safety 8,968,009 736,004 438,189 -
Public works 3,725,075 234,121 231,733 780,874
Culture and recreation 2,270,751 316,820 17,603 267,876
Economic development 1,350,348 - 76,250 -
Interest on long-term debt 1,570,807 - - -
Total Governmental Activities 20,830,615 1,504,128 866,861 1,048,750
Business-Type Activities
Sewer utility 3,096,526 3,712,613 93,335 -
Water utility 4,195,981 5,468,607 15,861 12,922
Golf course 316,173 423,766 129 -
Ice arena 1,012,913 601,291 585 -
Storm water 877,244 1,259,707 421 -
Street lighting 133,270 161,866 - -
Total Business-type Activities 9,632,107 11,627,850 110,331 12,922
Total 30,462,722$ 13,131,978$ 977,192$ 1,061,672$
General Revenues
Taxes
Property taxes
Tax increments
Franchise taxes
Grants and contributions not restricted to specific programs
Unrestricted investment earnings
Gain on sale of capital assets
Transfers - Internal Activities
Total General Revenues and Transfers
Change in Net Position
Net Position, January 1
Net Position, December 31
Functions/Programs
Program Revenues
City of New Hope, Minnesota
Statement of Activities
For the Year Ended December 31, 2020
See notes to basic financial statements -16-
Governmental
Activities
Business-Type
Activities Total
(2,625,356)$ -$ (2,625,356)$
(7,793,816) - (7,793,816)
(2,478,347) - (2,478,347)
(1,668,452) - (1,668,452)
(1,274,098) - (1,274,098)
(1,570,807) - (1,570,807)
(17,410,876) - (17,410,876)
- 709,422 709,422
- 1,301,409 1,301,409
- 107,722 107,722
- (411,037) (411,037)
- 382,884 382,884
- 28,596 28,596
- 2,118,996 2,118,996
(17,410,876) 2,118,996 (15,291,880)
16,821,240 - 16,821,240
1,918,857 - 1,918,857
958,162 - 958,162
2,497,630 - 2,497,630
781,304 137,468 918,772
22,000 - 22,000
(240,739) 240,739 -
22,758,454 378,207 23,136,661
5,347,578 2,497,203 7,844,781
53,469,790 23,727,941 77,197,731
58,817,368$ 26,225,144$ 85,042,512$
Net (Expenses) Revenues
and Changes in Net Position
-17-
THIS PAGE INTENTIONALLY LEFT BLANK
FUND FINANCIAL STATEMENTS
CITY OF NEW HOPE, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2020
City of New Hope, Minnesota
Balance Sheet
Governmental Funds
December 31, 2020
9001 9015/9501 9213-9228 9202
Economic
Development HRA City Hall
General Authority Construction CIP
Assets
Cash and temporary investments 8,663,198$ 2,004,366$ 5,006,979$ 1,411,332$
Receivables
Taxes 346,582 - 2,680 -
Accrued interest 65,631 - - -
Accounts 231,879 87,128 19,475 -
Loans - 240,500 - -
Special assessments 46,146 2,985 - -
Due from other governments 51,000 - - -
Prepaid items 24,499 - - -
Due from other funds 156,685 - -
Advances to other funds - 2,004,480 2,003,318 -
Total Assets 9,585,620$ 4,339,459$ 7,032,452$ 1,411,332$
Liabilities
Accrued salaries payable 262,435$ 9,087$ -$ -$
Accounts and contracts payable 109,467 6,931 - 193,972
Due to other governments 15,245 - - -
Deposits payable 14,495 - - -
Due to other funds - - -
Advances from other funds - - 1,653,364 -
Unearned revenue - - - -
Total Liabilities 401,642 16,018 1,653,364 193,972
Deferred Inflows of Resources
Unavailable revenue - taxes 215,426 - - -
Unavailable revenue - special assessments 42,466 2,985 - -
Resources received in advance - - - -
Total Deferred Inflows of Resources 257,892 2,985 - -
Fund Balances (Deficit)
Nonspendable 24,499 - - -
Restricted - - 5,379,088 -
Committed - 4,320,456 - -
Assigned - -- 1,217,360
Unassigned 8,901,587 - - -
Total Fund Balances (Deficit)8,926,086 4,320,456 5,379,088 1,217,360
Total Liabilities, Deferred Inflows
of Resources, and Fund Balances 9,585,620$ 4,339,459$ 7,032,452$ 1,411,332$
See notes to basic financial statements -18-
9203 9234 9117-9121
Park/Pool Other Total
Street Improvement Governmental Governmental
Infrastructure Project HRA Bonds Funds Funds
2,229,491$ 698,398$ 232,407$ 8,353,529$ 28,599,700$
- - 2,741 - 352,003
- - - - 65,631
- - - 23,589 362,071
- - - 21,016 261,516
467,290 - - 60,878 577,299
53,844 - - - 104,844
- - - - 24,499
- - - 75,000 231,685
- - - 375,000 4,382,798
2,750,625$ 698,398$ 235,148$ 8,909,012$ 34,962,046$
-$ -$ -$ -$ 271,522$
162,517 48,062 516 10,561 532,026
- - - - 15,245
- - - - 14,495
75,000 - - - 75,000
375,000 - 2,354,434 - 4,382,798
- - - 13,800 13,800
612,517 48,062 2,354,950 24,361 5,304,886
- - - - 215,426
467,030 - - 53,621 566,102
1,420,381 - - - 1,420,381
1,887,411 - - 53,621 2,201,909
- - - - 24,499
- 650,336 - 2,986,882 9,016,306
- - - 318,934 4,639,390
250,697 - - 5,525,343 6,993,400
- - (2,119,802) (129) 6,781,656
250,697 650,336 (2,119,802) 8,831,030 27,455,251
2,750,625$ 698,398$ 235,148$ 8,909,012$ 34,962,046$
-19-
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City of New Hope, Minnesota
Reconciliation of the Balance Sheet
to the Statement of Net Position
Governmental Funds
December 31, 2020
Total Fund Balances - Governmental Funds 27,455,251$
Amounts reported for the governmental activities in the statement of net position are different because:
Capital assets used in governmental activities are not financial resources and therefore are
not reported as assets in governmental funds.
Cost of capital assets 91,093,283
Less: accumulated depreciation (20,602,577)
Noncurrent liabilities, including bonds payable, are not due and payable in the current period and
therefore are not reported as liabilities in the funds. Noncurrent liabilities at year-end consist of
Bond principal payable (42,346,280)
Plus: unamortized bond premium (2,589,786)
Pension liability (6,428,510)
Internal service funds are used by management to charge certain costs of services to individual funds.
The assets and liabilities are included in the statement of net position.
Internal service fund net position included in governmental activities 11,766,990
Internal balances for internal services used by business-type activities 257,622
Some receivables are not available soon enough to pay for the current period's expenditures,
and therefore are reported as unavailable revenue in the funds.
Taxes 215,426
Special assessments 566,102
Governmental funds do not report long-term amounts related to pensions
Deferred outflows of pension resources 2,291,710
Deferred inflows of pension resources (2,873,353)
Governmental funds do not report a liability for accrued interest until due and payable.(625,111)
The City's investment in a joint venture is not a current financial resource and, therefore, is not
reported as an asset in the governmental funds, but is included in the Statement of Net Position.636,601
Total Net Position - Governmental Activities 58,817,368$
See notes to basic financial statements -20-
City of New Hope, Minnesota
Statement of Revenues, Expenditures and Changes in Fund Balances
Governmental Funds
For the Year Ended December 31, 2020
9001 9015/9501 9213-9228 9202
Economic
Development HRA City Hall
General Authority Construction CIP
Revenues
Taxes
Property taxes 10,422,823$ 348,000$ -$ -$
Tax increments - - 1,174,001 -
Franchise taxes 518,162 - - -
Licenses and permits 393,911 - - -
Intergovernmental 3,161,645 76,250 - -
Charges for services 704,320 - - -
Fines and forfeitures 138,922 - - -
Special assessments 110,670 10,384 - -
Investment earnings 113,447 105,845 129,625 44,124
Miscellaneous 14,184 12,516 - -
Total Revenues 15,578,084 552,995 1,303,626 44,124
Expenditures
Current
General government 2,062,733 - - -
Public safety 8,361,209 - - -
Public works 1,622,046 - - -
Culture and recreation 2,035,658 - - -
Economic development - 918,678 369,029 -
Capital outlay
General government 674 - - 621,058
Public safety 48,669 - - -
Public works - - - -
Culture and recreation - - - -
Economic development - - 81,785 -
Debt service
Principal - - - -
Interest and fiscal charges - - 128,864 -
Total Expenditures 14,130,989 918,678 579,678 621,058
Excess (Deficiency) of
Revenues Over Expenditures 1,447,095 (365,683) 723,948 (576,934)
Other Financing Sources (Uses)
Transfers in 339,288 - - -
Transfers out - (35,619) - -
Total Other Financing Sources (Uses)339,288 (35,619) - -
Net Change in Fund Balances 1,786,383 (401,302) 723,948 (576,934)
Fund Balances (Deficit), January 1 7,139,703 4,721,758 4,655,140 1,794,294
Fund Balances (Deficit), December 31 8,926,086$ 4,320,456$ 5,379,088$ 1,217,360$
See notes to basic financial statements -21-
9203 9234 9117-9121
Park/Pool Other Total
Street Improvement Governmental Governmental
Infrastructure Project HRA Bonds Funds Funds
1,467,333$ -$ -$ 4,517,952$ 16,756,108$
- - 744,856 - 1,918,857
440,000 - - - 958,162
- - - - 393,911
695,197 338,770 - 17,876 4,289,738
- - - 282,567 986,887
- - - - 138,922
104,619 - - 8,592 234,265
62,954 16,297 - 135,198 607,490
- - - - 26,700
2,770,103 355,067 744,856 4,962,185 26,311,040
- - - - 2,062,733
- - - - 8,361,209
- - - 231,349 1,853,395
- - - - 2,035,658
- - 3,643 - 1,291,350
- - - - 621,732
- - - - 48,669
2,513,630 - - - 2,513,630
- 5,021,546 - 382,396 5,403,942
- - - - 81,785
- - 420,725 1,485,165 1,905,890
11,042 - 196,194 1,442,553 1,778,653
2,524,672 5,021,546 620,562 3,541,463 27,958,646
245,431 (4,666,479) 124,294 1,420,722 (1,647,606)
- - - 79,373 418,661
(10,588) - - (520,585) (566,792)
(10,588) - - (441,212) (148,131)
234,843 (4,666,479) 124,294 979,510 (1,795,737)
15,854 5,316,815 (2,244,096) 7,851,520 29,250,988
250,697$ 650,336$ (2,119,802)$ 8,831,030$ 27,455,251$
-22-
THIS PAGE INTENTIONALLY LEFT BLANK
City of New Hope, Minnesota
Reconciliation of the Statement of Revenues, Expenditures and
Changes in Fund Balances to the Statement of Activities
Governmental Funds
For the Year Ended December 31, 2020
Net Change in Fund Balances - Governmental Funds (1,795,737)$
Amounts reported for governmental activities in the statement of activities are different because:
Capital outlays are reported in governmental funds as expenditures. However, in the statement of
activities, the cost of those assets is allocated over the estimated useful lives as depreciation expense.
Capital outlays 8,302,379
Capital assets transferred from internal service funds 22,997
Depreciation expense (2,413,980)
The Statement of Activities reports gains and losses arising from the trade-in or disposal of existing assets to
acquire new capital assets. Conversely, governmental funds simply report proceeds on sale of capital assets. (796,143)
The City's investment in a joint venture is not a current financial resource and, therefore, is not
reported as an asset in the governmental funds, but is included in the Statement of Net Position.
Change in investment in joint venture (175,588)
The issuance of long-term debt provides current financial resources to governmental funds, while the
repayment of principal of long-term debt consumes the current financial resources of governmental
funds. Neither transaction, however, has any effect on net position. Also, governmental funds report
the effect of premiums, discounts and similar items when debt is first issued, whereas these amounts
are deferred and amortized in the statement of activities. The amounts below are the effects of these
differences in the treatment of long-term debt and related items.
Principal repayments 1,905,890
Amortization of bond premium 173,441
Interest on long-term debt in the statement of activities differs from the amount reported in the
governmental funds because interest is recognized as an expenditure in the funds when it is due,
and thus requires the use of current financial resources. In the statement of activities, however,
interest expense is recognized as the interest accrues, regardless of when it is due.34,405
Certain revenues are recognized as soon as they are earned. Under the modified accrual basis of
accounting, certain revenues cannot be recognized until they are available to liquidate liabilities
of the current period.
Property taxes 65,132
Special assessments (148,588)
State aids (88,770)
Long-term pension activity is not reported in governmental funds
Pension expense (336,542)
Direct aid contributions 60,778
Internal service funds are used by management to charge the costs for equipment, information system,
equipment replacement, employee benefits and major losses incurred by individual funds. The
activities of internal service funds is reported in the government-wide financial statements.
Change in net position of the internal service funds 737,263
Less: the change in internal balances for internal services used by business-type activities (199,359)
Change in Net Position - Governmental Activities 5,347,578$
See notes to basic financial statements -23-
City of New Hope, Minnesota
General Fund
Budget and Actual
For the Year Ended December 31, 2020
Budgeted Amounts Actual Over (Under)
Original Final Amounts Budget
Revenues
Taxes
Property taxes 10,518,931$ 10,518,931$ 10,422,823$ (96,108)$
Franchise taxes 505,244 505,244 518,162 12,918
Licenses and permits 474,025 474,025 393,911 (80,114)
Intergovernmental 1,405,262 1,405,262 3,161,645 1,756,383
Charges for services 1,849,300 1,849,300 704,320 (1,144,980)
Fines and forfeitures 225,000 225,000 138,922 (86,078)
Special assessments 30,000 30,000 110,670 80,670
Investment earnings 60,000 60,000 113,447 53,447
Miscellaneous 3,500 3,500 14,184 10,684
Total Revenues 15,071,262 15,071,262 15,578,084 506,822
Expenditures
Current
General government 2,034,950 2,034,950 2,062,733 27,783
Public safety 8,804,299 8,804,299 8,361,209 (443,090)
Public works 1,620,168 1,620,168 1,622,046 1,878
Culture and recreation 2,882,633 2,882,633 2,035,658 (846,975)
Capital outlay -
General government 3,500 3,500 674 (2,826)
Public safety 65,000 65,000 48,669 (16,331)
Total Expenditures 15,410,550 15,410,550 14,130,989 (1,279,561)
Excess (Deficiency) of
Revenues Over Expenditures (339,288) (339,288) 1,447,095 1,786,383
Other Financing Sources
Transfers in 339,288 339,288 339,288 -
Net Change in Fund Balances - - 1,786,383 1,786,383
Fund Balances, January 1 7,139,703 7,139,703 7,139,703 -
Fund Balances, December 31 7,139,703$ 7,139,703$ 8,926,086$ 1,786,383$
Statement of Revenues, Expenditures, and Changes in Fund Balances –
See notes to basic financial statements -24-
City of New Hope, Minnesota
Economic Development Authority Fund
Statement of Revenues, Expenditures, and Changes in Fund Balances –
Budget and Actual
For the Year Ended December 31, 2020
Actual Over (Under)
Original Final Amounts Budget
Revenues
Taxes
Property taxes 348,000$ 348,000$ 348,000$ -$
Intergovernmental 100,000 100,000 76,250 (23,750)
Special assessments 1,600 1,600 10,384 8,784
Investment earnings 76,000 76,000 105,845 29,845
Miscellaneous - - 12,516 12,516
Total Revenues 525,600 525,600 552,995 27,395
Expenditures
Current
Economic development
Personnel services 345,919 345,919 336,358 (9,561)
Supplies 300 300 76,250 75,950
Other services and charges 432,886 432,886 506,070 73,184
Total Expenditures 779,105 779,105 918,678 139,573
Excess (Deficiency) of
Revenues Over Expenditures (253,505) (253,505) (365,683) (112,178)
Other Financing Sources (Uses)
Transfers out (35,619) (35,619) (35,619) -
Net Change in Fund Balances (289,124) (289,124) (401,302) (112,178)
Fund Balances, January 1 4,721,758 4,721,758 4,721,758 -
Fund Balances, December 31 4,432,634$ 4,432,634$ 4,320,456$ (112,178)$
Budgeted Amounts
See notes to basic financial statements -25-
City of New Hope, Minnesota City of New Hope, Minnesota
Statement of Net Position (Continued on the Following Pages)Statement of Net Position (Continued)
Proprietary Funds Proprietary Funds
December 31, 2020
9300 9301 9302 9303
Sewer Utility Water Utility Golf Course Ice Arena
Assets
Current Assets
Cash and temporary investments 1,400,403$ 2,345,370$ 214,545$ 800$
Cash held with fiscal agent - - - 1,560,053
Receivables
Accounts 341,662 928,912 4,355 38,296
Special assessments 53,611 120,942 - -
Due from other governments - - - 60,084
Inventories - 37,976 4,516 -
Total Current Assets 1,795,676 3,433,200 223,416 1,659,233
Noncurrent Assets
Investment in joint ventures - 168,509 - -
Capital assets
Land - - 250,625 -
Buildings and structures - - 973,145 9,824,219
Vehicles and equipment 607,475 1,392,767 122,348 382,566
Improvements other than buildings 6,628,754 11,323,137 140,620 -
Construction in progress 448,066 796,122 - -
Less: accumulated depreciation (3,042,136) (4,222,936) (1,037,058) (4,244,148)
Total Capital Assets
(Net of Accumulated Depreciation)4,642,159 9,289,090 449,680 5,962,637
Total Noncurrent Assets 4,642,159 9,457,599 449,680 5,962,637
Total Assets 6,437,835 12,890,799 673,096 7,621,870
Deferred Outflows of Resources
Deferred pension resources 36,362 17,336 5,149 23,370
Deferred other postemployment
benefit resources 11,851 5,502 987 5,964
Total Deferred Outflows of Resources 48,213 22,838 6,136 29,334
Business-Type Activities - Enterprise Funds
See notes to basic financial statements -26-(continued)
City of New Hope, Minnesota
Statement of Net Position (Continued)
Proprietary Funds
December 31, 2020
Governmental
Activities -
9304 9305 Internal
Storm Water Street Lighting Totals Service Funds
Assets
Current Assets
Cash and temporary investments 1,024,563$ 70,954$ 5,056,635$ 11,164,834$
Cash held with fiscal agent - - 1,560,053 -
Receivables
Accounts 116,960 6,887 1,437,072 7,441
Special assessments 15,355 2,302 192,210 -
Due from other governments - - 60,084 -
Inventories - - 42,492 68,035
Total Current Assets 1,156,878 80,143 8,348,546 11,240,310
Noncurrent Assets
Investment in joint ventures - - 168,509 -
Capital assets
Land 234,417 - 485,042 85,647
Buildings and structures - - 10,797,364 3,158,296
Vehicles and equipment - - 2,505,156 9,763,536
Improvements other than buildings 10,040,483 389,705 28,522,699 -
Construction in progress 126,636 - 1,370,824 -
Less: accumulated depreciation (1,778,822) (19,485) (14,344,585) (10,164,275)
Total Capital Assets
(Net of Accumulated Depreciation)8,622,714 370,220 29,336,500 2,843,204
Total Noncurrent Assets 8,622,714 370,220 29,505,009 2,843,204
Total Assets 9,779,592 450,363 37,853,555 14,083,514
Deferred Outflows of Resources
Deferred pension resources 16,814 - 99,031 23,772
Deferred other postemployment benefit resources 4,167 - 28,471 167,973
Total Deferred Outflows of Resources 20,981 - 127,502 191,745
Business-Type Activities - Enterprise Funds
See notes to basic financial statements -27-(continued)
City of New Hope, Minnesota City of New Hope, Minnesota
Statement of Net Position (Continued)Statement of Net Position (Continued)
Proprietary Funds Proprietary Funds
December 31, 2020
9300 9301 9302 9303
Sewer Utility Water Utility Golf Course Ice Arena
Liabilities
Current Liabilities
Accrued salaries payable 13,478$ 20,062$ 2,143$ 11,003$
Accounts and contracts payable 183,320 76,811 4,522 39,139
Due to other governments - 533,806 187 3,983
Accrued interest payable 8,902 31,881 - 4,790
Due to other funds - - - 156,685
Deposits payable - 3,556 - -
Compensated absences payable, current portion - - - -
Bonds and notes payable, current portion 57,501 324,780 - -
Total Current Liabilities 263,201 990,896 6,852 215,600
Noncurrent Liabilities
Other postemployment benefits payable 78,344 36,372 6,530 39,423
Pension liability 339,285 161,761 48,040 218,058
Compensated absences payable - - - -
Unamortized premium 19,005 76,797 - -
Bonds and notes payable 739,847 2,962,132 - 3,505,000
Total Noncurrent Liabilities 1,176,481 3,237,062 54,570 3,762,481
Total Liabilities 1,439,682 4,227,958 61,422 3,978,081
Deferred Inflows of Resources
Deferred pension resources 13,610 6,489 1,927 8,747
Deferred other postemployment benefit resources 2,343 1,088 194 1,179
Total Deferred Inflows of Resources 15,953 7,577 2,121 9,926
Net Position
Net investment in capital assets 3,825,806 5,925,381 449,680 2,457,637
Restricted for debt service - - - 1,560,053
Unrestricted 1,204,607 2,752,721 166,009 (354,493)
Total Net Position 5,030,413$ 8,678,102$ 615,689$ 3,663,197$
Business-Type Activities - Enterprise Funds
See notes to basic financial statements -28-(continued)
City of New Hope, Minnesota
Statement of Net Position (Continued)
Proprietary Funds
December 31, 2020
Governmental
Activities -
9304 9305 Internal
Storm Water Street Lighting Totals Service Funds
Liabilities
Current Liabilities
Accrued salaries payable 3,940$ -$ 50,626$ 162,868$
Accounts and contracts payable 12,548 9,409 325,749 126,938
Due to other governments - - 537,976 631
Accrued interest payable 17,358 - 62,931 -
Due to other funds - - 156,685 -
Deposits payable - - 3,556 -
Compensated absences payable, current portion - - - 84,346
Bonds and notes payable, current portion 154,834 - 537,115 -
Total Current Liabilities 188,680 9,409 1,674,638 374,783
Noncurrent Liabilities
Other postemployment benefits payable 27,550 - 188,219 1,110,463
Pension liability 156,882 - 924,026 221,812
Compensated absences payable - - - 759,110
Unamortized premium 40,690 - 136,492 -
Bonds and notes payable 1,328,626 - 8,535,605 -
Total Noncurrent Liabilities 1,553,748 - 9,784,342 2,091,385
Total Liabilities 1,742,428 9,409 11,458,980 2,466,168
Deferred Inflows of Resources
Deferred pension resources 6,293 - 37,066 8,898
Deferred other postemployment benefit resources 824 - 5,628 33,203
Total Deferred Inflows of Resources 7,117 - 42,694 42,101
Net Position
Net investment in capital assets 7,098,564 370,220 20,127,288 2,843,204
Restricted for debt service - - 1,560,053 -
Unrestricted 952,464 70,734 4,792,042 8,923,786
Total Net Position 8,051,028$ 440,954$ 26,479,383$ 11,766,990$
Total Net Position - Enterprise Funds 26,479,383$
Adjustment to reflect the consolidation of internal service fund
activities related to the enterprise funds (257,622)
Net Position - Business-type Activities 26,221,761$
Business-Type Activities - Enterprise Funds
-29-
City of New Hope, Minnesota City of New Hope, Minnesota
Statement of Revenues, Expenses and Statement of Revenues, Expenses and
Changes in Net Position Changes in Net Position (Continued)
Proprietary Funds Proprietary Funds
For the Year Ended December 31, 2020 For the Year Ended December 31, 2020
9300 9301 9302 9303
Sewer Utility Water Utility Golf Course Ice Arena
Operating Revenues
Charges for services 3,712,613$ 5,139,616$ 401,666$ 560,316$
Billings to departments - - - -
Other - - - -
Total Operating Revenues 3,712,613 5,139,616 401,666 560,316
Operating Expenses
Cost of goods sold 1,845,989 3,090,013 23,816 -
Personnel services 683,595 210,954 130,264 416,763
Supplies 12,287 69,045 24,917 36,154
Utilities 9,505 632 26,983 211,668
Other services and charges 383,807 482,142 82,511 106,389
Depreciation 184,090 325,447 36,503 195,894
Total Operating Expenses 3,119,273 4,178,233 324,994 966,868
Operating Income (Loss)593,340 961,383 76,672 (406,552)
Nonoperating Revenues (Expenses)
Investment earnings 41,283 47,238 1,983 30,741
Miscellaneous revenues 910 344,852 22,229 41,560
Intergovernmental 92,425 - - -
Capital contributions to governmental activities - - - -
Gain (loss) on sale of capital assets - - - (3,383)
Interest expense (37,701) (86,576) - (58,181)
Total Nonoperating Revenues (Expenses)96,917 305,514 24,212 10,737
Income (Loss) Before Contributions
and Transfers 690,257 1,266,897 100,884 (395,815)
Capital Contributions - 12,922 - -
Transfers In - -- 400,000
Transfers Out (55,564) (57,939) (10,769) (10,769)
Change in Net Position 634,693 1,221,880 90,115 (6,584)
Net Position, January 1 4,395,720 7,456,222 525,574 3,669,781
Net Position, December 31 5,030,413$ 8,678,102$ 615,689$ 3,663,197$
Business-Type Activities - Enterprise Funds
See notes to basic financial statements -30-
City of New Hope, Minnesota
Statement of Revenues, Expenses and
Changes in Net Position (Continued)
Proprietary Funds
For the Year Ended December 31, 2020
Governmental
Activities -
9304 9305 Internal
Storm Water Street Lighting Totals Service Funds
Operating Revenues
Charges for services 1,259,707$ 161,866$ 11,235,784$ -$
Billings to departments - - - 3,699,238
Other - - - 23,526
Total Operating Revenues 1,259,707 161,866 11,235,784 3,722,764
Operating Expenses
Cost of goods sold - - 4,959,818 -
Personnel services 198,352 - 1,639,928 1,030,498
Supplies 6,776 - 149,179 284,174
Utilities - 103,069 351,857 106,343
Other services and charges 439,257 10,605 1,504,711 1,067,124
Depreciation 241,636 19,485 1,003,055 577,571
Total Operating Expenses 886,021 133,159 9,608,548 3,065,710
Operating Income (Loss)373,686 28,707 1,627,236 657,054
Nonoperating Revenues (Expenses)
Investment earnings 15,370 853 137,468 173,814
Miscellaneous revenues 421 - 409,972 -
Intergovernmental - - 92,425 -
Capital contributions to governmental activities - - - (22,997)
Gain (loss) on sale of capital assets - - (3,383) 22,000
Interest expense (40,460) - (222,918) -
Total Nonoperating Revenues (Expenses)(24,669) 853 413,564 172,817
Income (Loss) Before Contributions
and Transfers 349,017 29,560 2,040,800 829,871
Capital Contributions - - 12,922 -
Transfers In - - 400,000 -
Transfers Out (24,220) - (159,261) (92,608)
Change in Net Position 324,797 29,560 2,294,461 737,263
Net Position, January 1 7,726,231 411,394 24,184,922 11,029,727
Net Position, December 31 8,051,028$ 440,954$ 26,479,383$ 11,766,990$
Change in Net Position - Enterprise Funds 2,294,461$
Adjustment to reflect the consolidation of internal service fund activities related to
the enterprise funds.199,359
Change in Net Position - Business-Type Activities 2,493,820$
Business-Type Activities - Enterprise Funds
-31-
City of New Hope, Minnesota City of New Hope, Minnesota
Statement of Cash Flows (Continued on the Following Pages)Statement of Cash Flows (Continued)
Proprietary Funds Proprietary Funds
For the Year Ended December 31, 2020 For the Year Ended December 31, 2020
9300 9301 9302 9303
Sewer Utility Water Utility Golf Course Ice Arena
Cash Flows from Operating Activities
Receipts from customers and users 3,702,655$ 5,089,495$ 399,031$ 581,514$
Receipts from interfund services provided - - - -
Other operating receipts 93,335 344,852 22,229 41,560
Payments to suppliers (2,094,037) (3,336,608) (157,349) (399,706)
Payments to employees (524,922) (270,851) (129,716) (399,569)
Net Cash From
Operating Activities 1,177,031 1,826,888 134,195 (176,201)
Cash Flows From Noncapital
Financing Activities
Receipts on interfund balances - - - 156,685
Payments on interfund balances - - - (104,291)
Transfers in - - - 400,000
Transfers out (55,564) (57,939) (10,769) (10,769)
Net Cash From
Noncapital Financing Activities (55,564) (57,939) (10,769) 441,625
Cash Flows from Capital
and Related Financing Activities
Acquisition of capital assets (436,835) (745,251) - (36,332)
Proceeds from sale of assets - - - -
Payment of advance from other funds (875,000) (570,598) - -
Capital contributions - 12,922 - -
Principal paid on long-term debt (56,116) (321,260) - -
Interest paid on long-term debt (39,548) (100,331) - (58,181)
Net Cash From
Capital and Related Financing Activities (1,407,499) (1,724,518) - (94,513)
Cash Flows from Investing Activities
Investment earnings 41,283 47,238 1,983 30,741
Net Increase (Decrease)
in Cash and Cash Equivalents (244,749) 91,669 125,409 201,652
Cash and Cash Equivalents, January 1 1,645,152 2,253,701 89,136 1,359,201
Cash and Cash Equivalents, December 31 1,400,403$ 2,345,370$ 214,545$ 1,560,853$
Reconciliation to the Proprietary Funds
Statement of Net Position
Cash and temporary investments 1,400,403$ 2,345,370$ 214,545$ 800$
Cash held with fiscal agent - - - 1,560,053
Total Cash and Cash Equivalents 1,400,403$ 2,345,370$ 214,545$ 1,560,853$
Business-Type Activities - Enterprise Funds
See notes to basic financial statements -32-(continued)
City of New Hope, Minnesota
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended December 31, 2020
Governmental
Activities -
9304 9305 Internal
Storm Water Street Lighting Totals Service Funds
Cash Flows from Operating Activities
Receipts from customers and users 1,263,488$ 163,626$ 11,199,809$ -$
Receipts from interfund services provided - - - 3,696,272
Other operating receipts 421 - 502,397 23,526
Payments to suppliers (455,566) (113,335) (6,556,601) (1,471,777)
Payments to employees (224,660) - (1,549,718) (792,031)
Net Cash From
Operating Activities 583,683 50,291 3,595,887 1,455,990
Cash Flows from Noncapital
Financing Activities
Receipts on interfund balances - - 156,685 -
Payments on interfund balances - - (104,291) -
Transfers in - - 400,000 -
Transfers out (24,220) - (159,261) (92,608)
Net Cash From
Noncapital Financing Activities (24,220) - 293,133 (92,608)
Cash Flows from Capital
and Related Financing Activities
Acquisition of capital assets (66,297) - (1,284,715) (525,988)
Proceeds from sale of assets - - - 22,000
Payment of advance from other funds - - (1,445,598) -
Capital contributions - - 12,922 -
Principal paid on long-term debt (147,734) - (525,110) -
Interest paid on long-term debt (44,083) - (242,143) -
Net Cash From
Capital and Related Financing Activities (258,114) - (3,484,644) (503,988)
Cash Flows from Investing Activities
Investment earnings 15,370 853 137,468 173,814
Net Increase (Decrease)
in Cash and Cash Equivalents 316,719 51,144 541,844 1,033,208
Cash and Cash Equivalents, January 1 707,844 19,810 6,074,844 10,131,626
Cash and Cash Equivalents, December 31 1,024,563$ 70,954$ 6,616,688$ 11,164,834$
Reconciliation to the Proprietary Funds
Statement of Net Position
Cash and temporary investments 1,024,563$ 70,954$ 5,056,635$ 11,164,834$
Cash held with fiscal agent - - 1,560,053 -
Total Cash and Cash Equivalents 1,024,563$ 70,954$ 6,616,688$ 11,164,834$
Business-Type Activities - Enterprise Funds
See notes to basic financial statements -33-(continued)
City of New Hope, Minnesota City of New Hope, Minnesota
Statement of Cash Flows (Continued)Statement of Cash Flows (Continued)
Proprietary Funds Proprietary Funds
For the Year Ended December 31, 2020 For the Year Ended December 31, 2020
9300 9301 9302 9303
Sewer Utility Water Utility Golf Course Ice Arena
Reconciliation of Operating Income (Loss)
to Net Cash From Operating Activities
Operating income (loss)593,340$ 961,383$ 76,672$ (406,552)$
Adjustments to reconcile operating income (loss)
to net cash from operating activities
Depreciation 184,090 325,447 36,503 195,894
Other income related to operations 93,335 344,852 22,229 41,560
(Increase) decrease in assets
Receivables
Accounts (9,991) (61,269) (2,635) 30,524
Special assessments 33 5,559 - -
Due from other governments - 5,589 - (9,326)
Inventories - (701) 1,216 -
(Increase) decrease in deferred outflows of resources
Deferred pension resources (18,546) 2,952 (841) (5,171)
Deferred other postemployment benefit resources (5,741) (561) (288) (1,916)
Increase (decrease) in liabilities
Accounts and contracts payable 158,617 9,067 (328) (33,706)
Accrued salaries payable 5,151 6,844 496 276
Due to other governments (1,066) 296,858 (10) (11,789)
Compensated absences payable - - - -
Other postemployment benefits payable 30,454 (2,356) 1,054 7,697
Pension liability 165,845 (35,744) 6,099 40,897
Increase (decrease) in deferred inflows of resources
Deferred pension resources (18,976) (30,618) (5,953) (24,538)
Deferred other postemployment benefit resources 486 (414) (19) (51)
Net Cash From
Operating Activities 1,177,031$ 1,826,888$ 134,195$ (176,201)$
Schedule of Noncash Capital and
Related Financing Activities
Amortization of bond discount -$ -$ -$ -$
Amortization of bond premium 1,278$ 5,270$ -$ -$
Net book value of capital asset disposals -$ -$ -$ 3,383$
Capital assets contributed to governmental activities -$ -$ -$ -$
Business-Type Activities - Enterprise Funds
See notes to basic financial statements -34-(continued)
City of New Hope, Minnesota
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended December 31, 2020
Governmental
Activities -
9304 9305 Internal
Storm Water Street Lighting Totals Service Funds
Reconciliation of Operating Income (Loss)
to Net Cash From Operating Activities
Operating income (loss)373,686$ 28,707$ 1,627,236$ 657,054$
Adjustments to reconcile operating income (loss)
to net cash from operating activities
Depreciation 241,636 19,485 1,003,055 577,571
Other income related to operations 421 -502,397 -
(Increase) decrease in assets
Receivables
Accounts 2,570 1,572 (39,229) (2,966)
Special assessments 1,211 188 6,991 -
Due from other governments - - (3,737) -
Inventories - - 515 (5,460)
(Increase) Decrease in deferred outflows of resources
Deferred pension resources (4,071) -(25,677) (4,643)
Deferred other postemployment benefit resources 4,768 -(3,738) (48,960)
Increase (decrease) in liabilities
Accounts and contracts payable (8,479) 339 125,510 (8,727)
Accrued salaries payable 1,563 -14,330 18,343
Due to other governments (1,054) -282,939 51
Compensated absences payable - - - 89,575
Other postemployment benefits payable (42,488) -(5,639) 177,615
Pension liability 32,826 -209,923 35,592
Increase (decrease) in deferred inflows of resources
Deferred pension resources (17,014) -(97,099) (26,089)
Deferred other postemployment benefit resources (1,892) -(1,890) (2,966)
Net Cash From
Operating Activities 583,683$ 50,291$ 3,595,887$ 1,455,990$
Schedule of Noncash Capital and
Related Financing Activities
Amortization of bond discount 803$ -$ 803$ -$
Amortization of bond premium 2,803$ -$ 9,351$ -$
Net book value of capital asset disposals -$ -$ 3,383$ -$
Capital assets contributed to governmental activities -$ -$ -$ 22,997$
Business-Type Activities - Enterprise Funds
See notes to basic financial statements -35-
THIS PAGE INTENTIONALLY LEFT BLANK
CITY OF NEW HOPE, MINNESOTA
Notes to Basic Financial Statements
December 31, 2020
-36-
NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES
A. Organization
The City of New Hope, Minnesota (the City) operates under “Optional Plan B” as defined in Minnesota
Statutes, Chapter 412. Under this plan, the government of the City is run by a council composed of an
elected mayor and four councilmembers. The City Council exercises legislative authority and determines
all matters of policy. The city manager, who is appointed by the City Council, is responsible for the proper
administration of all affairs relating to the City.
The accounting policies of the City conform to accounting principles generally accepted in the United States
of America as applicable to governmental units.
B. Reporting Entity
As required by accounting principles generally accepted in the United States of America, these financial
statements include the City (the primary government) and its component units. Component units are legally
separate entities for which the primary government is financially accountable, or for which the exclusion
of the component unit would render the financial statements of the primary government misleading . The
criteria used to determine if the primary government is financially accountable for a component unit
includes whether or not the primary government appoints the voting majority of the potential component
unit’s board, is able to impose its will on the potential component unit, is in a relationship of financial
benefit or burden with the potential component unit, or is fiscally depended upon by the potential
component unit.
As a result of applying these criteria, certain organizations have been included or disclosed in this report as
follows:
1. Blended Component Unit – The New Hope Economic Development Authority (EDA) and
Housing and Redevelopment Authority (HRA) are fiscally dependent upon the City, and were
developed to control and operate the housing and redevelopment and tax increment districts within
the City. Since the City Council makes up the EDA and HRA boards, and funding for EDA and
HRA activities are provided by the City, both entities are considered to be blended component units
of the City, and are reported as special revenue, debt service, and capital projects funds.
2. Joint Ventures and Jointly Controlled Organization – The City participates in various joint
ventures and jointly controlled organizations, which are described later in these notes.
C. Government-Wide Financial Statements
The government-wide financial statements (Statement of Net Position and Statement of Activities) display
information about the reporting government as a whole. These statements include all of the financial
activities of the City. Governmental activities, which are normally supported by taxes and
intergovernmental revenues, are reported separately from business-type activities, which significantly rely
upon sales, fees, and charges for support.
-37-
NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
The Statement of Activities demonstrates the degree to which the direct expenses o f a given function or
segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a
specific function or segment. Program revenues include: 1) charges to customers or applicants who
purchase, use, or directly benefit from goods, services, or privileges provided b y a given function or
segment; 2) operating grants and contributions; and 3) capital grants and contributions, including special
assessments that are restricted to meeting the operational or capital requirements of a particular function or
segment. Taxes and other internally directed revenues are reported as general revenues.
The government-wide financial statements are reported using the economic resources measurement focus
and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when
a liability is incurred, regardless of the timing of related cash flows. Property taxes and special assessments
are recognized as revenues in the fiscal year for which they are certified for levy. Grants and similar items
are recognized when all eligibility requirements imposed by the provider have been met.
As a general rule, the effect of interfund activity has been eliminated from the government -wide financial
statements. However, charges between the City’s enterprise funds and other functions are not eliminated,
as that would distort the direct costs and program revenues reported in those functions. Depreciation
expense is included in the direct expenses of each function. Interest on long-term debt is considered an
indirect expense and is reported separately on the Statement of Activities.
D. Fund Financial Statement Presentation
Separate fund financial statements are provided for governmental and proprietary funds. Major individual
governmental and enterprise funds are reported as separate columns in the fund financial statements.
Aggregated information for the remaining nonmajor governmental funds is reported in a single column in
the fund financial statements.
Governmental fund financial statements are reported using the current financial resources measurement
focus and the modified accrual basis of accounting. Under this basis of accounting, transactions are recorded
in the following manner:
1. Revenue Recognition – Revenue is recognized when it becomes measurable and available.
“Measurable” means the amount of the transaction can be determined and “available” means
collectible within the current period or soon enough thereafter to be used to pay liabilities of the
current period. For this purpose, the City considers revenues to be available if they are coll ected
within 60 days after year-end. 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.
Grants and similar items are recognized when all eligibility requirements imposed by the provider
have been met. Proceeds of long-term debt and acquisitions under capital leases are reported as
other financing sources.
Major revenue that is susceptible to accrual includes property taxes, special assessments,
intergovernmental revenue, charges for services, and interest earned on investments. Major revenue
that is not susceptible to accrual includes licenses and permits, fees, and miscellaneous revenue .
Such revenue is recorded only when received because it is not measurable until collected.
2. Recording of Expenditures – Expenditures are generally recorded when a liability is incurred,
except for principal and interest on long-term debt and other long-term liabilities, which are
recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported
as capital outlay expenditures in the governmental funds.
-38-
NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Proprietary fund financial statements are reported using the economic resources measurement focus and
accrual basis of accounting, similar to the government-wide financial statements. 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 City’s enterprise
funds and internal service funds are charges to customers for sales and services. The operating expenses for
the enterprise funds and internal service funds include the cost of sales and services, administrative
expenses, and depreciation on capital assets. All revenues and expenses that do not meet this definition are
reported as nonoperating revenues and expenses.
Aggregated information for the internal service funds is reported in a single column in the proprietary fund
financial statements. Because the principal user of the internal services is the City’s governmental activities,
the financial statements of the internal service funds are consolidated into the governmental column when
presented in the government-wide financial statements. The cost of these services is reported in the
appropriate functional activity.
Description of Funds
The City reports the following major governmental funds:
General Fund – This is the general operating fund of the City. It is used to account for all financial
resources except those required to be accounted for in another fund.
Economic Development Authority Special Revenue Fund – This fund accounts for the activities of the
EDA, which controls and operates the housing and redevelopment projects and tax increment districts in
the City. Its activities are funded through property tax levies and federal and state aids and grants.
HRA Construction Capital Projects Fund – This fund is used to account for redevelopment costs for tax
increment districts, which are primarily funded by tax increment bonds and tax increment revenues.
City Hall CIP Capital Projects Fund – This fund is used to account for the accumulation of resources for
City Hall projects.
Street Infrastructure Capital Projects Fund – This fund is used to account for various street projects
within the City.
Park/Pool Improvement Project Capital Projects Fund – This fund is used to account for park and pool
improvements.
HRA Bonds Debt Service Fund – This fund is used to account for revenue from tax increments and interest
income to pay for the principal and interest on the City’s tax increment bond issues.
The City reports the following major enterprise funds:
Sewer Utility Fund – This fund accounts for the provisions of sewer services to residents of the City. All
activities necessary to provide such services are accounted for in this fund, including administration,
operations, maintenance, billing and collection.
Water Utility Fund – This fund is used to account for the provisions of water services to residents of the
City. All activities necessary to provide such services are accounted for in this fund, including
administration, operations, maintenance, billing and collection.
-39-
NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Golf Course Fund – This fund is used to account for the operations of the City’s public golf course.
Ice Arena Fund – This fund is used to account for the operation of the City’s indoor ice arena.
Storm Water Fund – This fund is used to account for the general operation and maintenance of the City’s
storm water system.
Street Lighting Fund – This fund is used to account for the operation of the City’s streetlight system.
The City also reports the following fund type:
Internal Service Funds – These funds are used to account for the City’s vehicle and equipment rental,
employee leave benefits, insurance, and information technology operations. Internal service funds operate
in a manner similar to enterprise funds; however, they provide services primarily to other departments
within the City.
E. Budgets and Budgetary Accounting
Each fall, following a truth in taxation public hearing, the City Council adopts an operating budget for the
following fiscal year beginning January 1. The City legally adopts budgets for the General Fund and certain
special revenue funds (Economic Development Authority and Solid Waste Management Funds), on a
modified accrual basis of accounting. The legal level of budgetary control is at the fund level. The city
manager may transfer appropriations within funds, or departments within funds, but needs City Council
approval to adjust the total budget of a fund. Appropriations lapse at year-end; however, the City Council
may approve the carryover of specific amounts. In 2020, expenditures exceeded budget in the Economic
Development Authority Special Revenue Fund by $139,573, and the (nonmajor) Solid Waste Management
Special Revenue Fund by $6,114. The excess spending was funded by revenues received in excess of budget
and available fund balance.
F. Cash, Cash Equivalents, and Investments
Cash balances from all funds are combined and invested to the extent available in short-term investments.
Earnings from the pooled investments are allocated to the individual funds based on the average monthly
cash and investment balances of the respective funds. Certain bond proceeds may be held separately for
capital projects. Earnings on these accounts are allocated directly to the respective funds.
For purposes of the Statement of Cash Flows, the City considers all highly liquid debt instruments with an
original maturity from the time of purchase of three months or less to be cash equivalents. The proprietary
funds’ portion of the government-wide cash and investment pool is considered to be cash equivalent,
including the cash held with fiscal agent.
The City generally reports investments at fair value other than for certain investment pools that are valued
at amortized cost.
The City categorizes its fair value measurements within the fair value hierarchy established by accounting
principles generally accepted in the United States of America. The hierarchy is based on the valuation inputs
used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical
assets; Level 2 inputs are significant other observable inputs; and Level 3 inputs are significant
unobservable inputs. Debt securities classified in Level 2 of the fair value hierarchy are valued using a
matrix pricing technique. Matrix pricing is used to value securities based on the securities’ relationship to
benchmark quoted prices. See Note 2 for the City’s recurring fair value measurements as of the current
year-end.
-40-
NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
G. Receivables
Accounts receivable include amounts billed for services provided before year-end. Unbilled utility
enterprise fund receivables are also included for services provided in the year. The City annually certifies
delinquent utility accounts to the county for collection in the following year; therefore, no allowance for
doubtful accounts has been established for the delinquent utility receivables.
H. Property Taxes
Property tax levies are set by the City Council in December of each year and are certified to Hennepin
County for collection in the following year. In Minnesota, counties act as collection agents for all property
taxes. The county spreads the levies over all taxable property. Such taxes become a lien on January 1 and
are recorded as receivables by the City on that date. Property taxes may be paid by taxpayers in two equal
installments on May 15 and October 15. The county provides tax settlements to cities and other taxing
districts three times a year; in July, December, and January.
Property taxes are recognized as revenue in the year levied in the government -wide financial statements
and proprietary fund financial statements. In the governmental fund financial statements, taxes are
recognized as revenue when received in cash or within 60 days after year-end. Taxes which remain unpaid
on December 31 are classified as delinquent taxes receivable and are offset by a deferred inflow of resources
in the governmental fund financial statements.
I. Special Assessments
Special assessments are levied against benefited properties for the cost or a portion of the cost of special
assessment improvement projects in accordance with Minnesota 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 withou t interest or
prepayment penalties.
In governmental 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 special assessments
receivable in governmental funds are completely offset by a deferred inflow of resources for assessments
not received within 60 days after year-end. In government-wide financial statements, special assessments
are recognized as revenues in the year for which they are certified. At December 31, 2020, the total
delinquent special assessment receivable balance was $45,957.
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 Minnesota 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.
-41-
NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
J. Interfund Balances and Transfers
In the fund financial statements, balances between funds that are representative of lending or borrowing
arrangements are reported as either “due to/from other funds” (current portion) or “advances to/from other
funds.” All other outstanding balances between funds are reported as “due to/from other funds.” Interfund
balances and transfers reported in the fund financial statements are eliminated to the extent possible in the
government-wide financial statements. Any residual balances outstanding between the governmental
activities and business-type activities are reported in the government-wide financial statements as “internal
balances.”
K. Inventory and Prepaid Items
Inventory is valued at cost using the first-in/first-out method. Inventory consists mainly of expendable
supplies held for consumption.
Certain cash payment to vendors reflects costs applicable to future accounting periods are recorded as
prepaid items in both government-wide and fund financial statements.
Inventory and prepaid items of the governmental funds are recorded as expenditures when consumed rather
than when purchased.
L. Capital Assets
Capital assets, which include property, buildings, improvements, equipment, and infrastructure assets
(roads, bridges, sidewalks, and similar items) are reported in the applicable governmental or business-type
activities columns in the government-wide financial statements. Such assets are capitalized at historical
cost or estimated historical cost for assets where actual historical cost is not available . Donated assets are
recorded as capital assets at their estimated acquisition value on the date of donation. The City defines
capital assets as those with an initial, individual cost of more than $5,000 with an estimated useful life in
excess of two years or more. The cost of normal maintenance and repairs that do not add to the value of the
asset or materially extend asset lives are not capitalized.
Capital assets are recorded in the government-wide and proprietary fund financial statements but are not
reported in the governmental fund financial statements. Capital assets are depreciated using the straight-line
method over their estimated useful lives. Land and construction in progress are not depreciated. Useful
lives vary from 15 to 50 years for buildings and structures, 15 to 50 years for improvements other than
buildings, and 3 to 20 years for vehicles and equipment.
M. Deferred Outflows/Inflows of Resources
In addition to assets and liabilities, statements of net position or balance sheets will sometimes report
deferred outflows or inflows of resources. These separate financial statement elements represent a
consumption or acquisition of net position that applies to a future period and so will not be recognized as
an outflow of resources (expense/expenditure) or an inflow of financial resources (revenue) until then.
Deferred outflows and inflows of resources related to pensions or other post-employment benefits (OPEB)
are reported in the government-wide and proprietary fund Statements of Net Position. These deferred
outflows and inflows of resources result from differences between expected and actual experience, changes
in proportion, assumption changes, differences between projected and actual earnings on plan investments,
and contributions to the plan subsequent to the measurement date and before the end of the reporting period.
These amounts are deferred and amortized as required under pension or OPEB standards.
-42-
NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Deferred inflows of resources from unavailable revenue arises only under a modified accrual basis of
accounting and, therefore, is only reported in governmental fund financial statements. The governmental
funds report unavailable revenues from two sources: property taxes and special assessments. These amounts
are deferred and recognized as an inflow of resources in the period that the amounts become available.
The City also reports deferred inflows or resources for resources received in advance, which is reported in
both the governmental fund financial statements and the government -wide financial statements. This item
represents amounts received before the applicable time requirements are met, but after all other eligibility
requirements have been met.
N. Long-Term Liabilities
In the government-wide financial statements and proprietary fund financial statements, long-term debt and
other long-term obligations are reported as liabilities. The recognition of bond premiums and discounts are
delayed and amortized over the life of the bonds using the straight-line method. Bonds payable are reported
net of the applicable bond premium or discount. Bond issuance costs are reported as an expense in the
period incurred.
In the fund financial statements, governmental fund types recognize bond premium 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.
O. Compensated Absences
A liability is recognized for unpaid vacation, sick leave, wellness days, and personal leave earned by
employees at the Balance Sheet date if it is probable the benefit will be paid as time off or at separation of
service. The City implemented a personal leave plan in 1994 in which all new employees, other than police
officers, participate. Employees who have had five or more years of service at the time of implementation
were allowed to choose between the personal leave plan or the vacation/sick leave plan. Under the
vacation/sick leave plan, employees are entitled to compensation for unpaid vacation time up to 160 hours
and one-third of their accumulated sick leave, to a maximum of 320 hours. Under personal leave, employees
are entitled to 200 hours of accumulated leave time. The Employee Leave Internal Service Fund is typically
used to liquidate governmental compensated absences payable.
P. Other Post-Employment Benefits (OPEB)
Under Minnesota Statutes Chapter 471.61, Subd. 2b, public employers must allow retirees and their
dependents to continue coverage indefinitely in an employer-sponsored health care plan, under the
following conditions: 1) retirees must be receiving (or eligible to receive) an annuity from a Minnesota
public pension plan, 2) coverage must continue in a group plan until age 65, and retirees must pay no more
than the group premium, and 3) retirees are able to add dependent coverage during open enrollment period
or qualifying life event prior to retirement. All premiums are funded on a pay-as-you-go basis. The liability
was determined, in accordance with Governmental Accounting Standards Board (GASB) Statement No. 75,
at December 31, 2020. The Insurance Reserve Internal Service Fund is typically used to liquidate
governmental OPEB payable.
Q. State-Wide Pension Plans
For purposes of measuring the net pension liability, deferred outflows/inflows of resources, and pension
expense, information about the fiduciary net position of the Public Employees Retirement Association
(PERA) and additions to/deductions from the PERA’s fiduciary net position have been determined on the
same basis as they are reported by the PERA. For this purpose, plan contributions are recognized as of
employer payroll paid dates and benefit payments and refunds are recognized when due and payable in
accordance with the benefit terms. Investments are reported at fair value.
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NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
R. 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; and natural disasters. The City participates in the League of Minnesota Cities
Insurance Trust (LMCIT), a public entity risk pool for its general property and casualty, workers ’
compensation, and other miscellaneous insurance coverage. The LMCIT operates as a common risk
management and insurance program for a large number of cities in Minnesota. The City pays an annual
premium to the LMCIT for insurance coverage. The LMCIT agreement provides that the trust will be
self-sustaining through member premiums and will reinsure through commercial companies for claims in
excess of certain limits. The City also carries commercial insurance for certain other risks of loss. Settled
claims resulting from these risks did not exceed insurance coverage in any of the last three fiscal years.
There were no significant reductions in insurance coverage in the current year.
S. Use of Estimates
The preparation of financial statements, in conformity with accounting principles generally accepted in the
United States of America, requires management to make estimates and assumptions that affect the amounts
reported at the date of the financial statements during the reporting period. Actual results could differ from
those estimates.
T. Fund Balance Classifications
In the fund financial statements, governmental funds report fund balance in classifications that disclose
constraints for which amounts in those funds can be spent. These classifications are as follows:
• Nonspendable – Consists of amounts that are not in spendable form, such as prepaid items,
inventory, and other long-term assets.
• Restricted – Consists of amounts related to externally imposed constraints established by creditors,
grantors, or contributors; or constraints imposed by state statutory provisions.
• Committed – Consists of internally imposed constraints established by resolution of the City
Council, which cannot be used for any other purpose unless the City Council removes or changes
the specified use by taking the same type of action employed to previously commit those amounts.
• Assigned – Consists of internally imposed constraints representing amounts intended to be used by
the City for specific purposes that do not meet the criteria to be classified as restricted or committed.
Assigned amounts represent intended uses established by the governing body itself or by an official
to which the governing body delegates the authority. The City Council has adopted a fund balance
policy, which delegates the authority to assign amounts for specific purposes to the finance manager
or city manager.
• Unassigned – The residual classification for the General Fund, which also reflects negative residual
amounts in other funds.
When both restricted and unrestricted resources are available for use, it is the City’s policy to first use
restricted resources, and then use unrestricted resources as needed. When committed, assigned, or
unassigned resources are available for use, it is the City’s policy to use resources in the following
order: 1) committed, 2) assigned, and 3) unassigned.
The City’s fund balance policy includes a fund balance goal in the General Fund of maintaining an
unassigned fund balance of 42 percent of the next year’s budgeted General Fund expenditures.
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NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
U. Net Position
In the government-wide and proprietary fund financial statements, net position represents the difference
between assets, deferred outflows of resources, liabilities, and deferred inflows of resources. Net position
is displayed in three components:
• Net Investment in Capital Assets – Consists of capital assets, net of accumulated depreciation,
reduced by any outstanding debt attributable to acquire capital assets.
• Restricted Net Position – Consists of net position restricted when there are limitations imposed
on its use through external restrictions imposed by creditors, grantors, or laws or regulations of
other governments.
• Unrestricted Net Position – All other elements of net position that do not meet the definition of
“restricted” or “net investment in capital assets.”
The City applies restricted resources first when an expense is incurred for which both restricted and
unrestricted resources are available.
V. Deficit Fund Equity
The following funds had fund balance or net position deficits at December 31, 2020:
Fund Amount
HRA Bonds Debt Service Fund 2,119,802$
Nonmajor governmental funds
2010B G.O. Equipment Bonds Debt Service Fund 129$
Internal service funds
Insurance Reserve 518,375$
The City plans to fund these deficits with future property taxes, tax increments, or transfers.
NOTE 2 – CASH AND INVESTMENTS
A. Components of Cash and Investments
Cash and investments are presented in the financial statements as follows:
Deposits 4,401,207$
Investments 41,977,420
Petty cash 2,595
Total 46,381,222$
Cash and investments at year-end consist of the following:
Statement of Net Position
Cash and temporary investments 44,821,169$
Cash held with fiscal agent 1,560,053
Total 46,381,222$
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NOTE 2 – CASH AND INVESTMENTS (CONTINUED)
B. Deposits
In accordance with applicable Minnesota Statutes, the City maintains deposits at depository banks
authorized by the City Council, including checking accounts and certificates of deposit.
The following is considered the most significant risk associated with deposits:
Custodial Credit Risk – In the case of deposits, this is the risk that in the event of a bank failure, the
City’s deposits may be lost.
Minnesota Statutes require that all deposits be protected by federal deposit insurance, corporate surety
bond, or collateral. The market value of collateral pledged must equal 110 percent of the deposits not
covered by federal deposit insurance or corporate surety bonds. Authorized collateral includes treasury
bills, notes, and bonds; issues of U.S. government agencies; general obligations rated “A” or better;
revenue obligations rated “AA” or better; irrevocable standard letters of credit issued by the Federal
Home Loan Bank; and certificates of deposit. Minnesota Statutes require that securities pledged as
collateral be held in safekeeping in a restricted account at the Federal Reserve Bank or in an account at
a trust department of a commercial bank or other financial institution that is not owned or controlled
by the financial institution furnishing the collateral. The City has no additional deposit policies
addressing custodial credit risk.
At year-end, the carrying amount of the City’s deposits was $4,401,207, while the balance on the bank
records was $4,771,392. At December 31, 2020, all deposits were fully covered by federal deposit
insurance or collateral held by the City’s agent in the City’s name.
C. Investments
The City has the following investments at year-end:
Fair Value
Measurements
Investment Type Rating Agency Using No Maturity Less Than 1 1 to 5 Greater Than 5 Total
U.S. agency securities
FNMA Level 2 –$ –$ –$ 1,299$ 1,299$
FHLB AA S&P Level 2 – – 1,673,759 – 1,673,759
FFCB AA S&P Level 2 – – 2,103,056 – 2,103,056
State and local government securities AA S&P Level 2 – – 516,880 – 516,880
U.S. Treasury securities Level 1 – – – 1,545,000 1,545,000
Negotiable certificates of deposit Level 2 – 3,701,078 7,681,302 – 11,382,380
Investment pool/mutual funds
4M Fund Not Applicable 2,342,420 – – – 2,342,420
Invesco Government and Agency Fund AAA S&P NAV 17,037,352 – – – 17,037,352
UBS Select Prime Institutional Fund AAA S&P NAV 5,375,274 – – – 5,375,274
Total investments 24,755,046$ 3,701,078$ 11,974,997$ 1,546,299$ 41,977,420$
Not Rated
Credit Risk
Not Rated
Interest Risk –
Maturity Duration in Years
Not Rated
Not Rated
All mutual funds currently held by the City reported at net asset value, have no funded commitments, and
have daily redemption frequencies with no redemption notice required. The Minnesota Municipal Money
Market (4M) Fund is external investment pool regulated by Minnesota Statutes that is not registered with
the Securities and Exchange Commission (SEC), but follows the regulatory rules of the SEC. The City’s
investment in this fund is measured at the value per share provided by the pool, which is based on an
amortized cost method that approximates fair value. There are no restrictions or limitations on withdrawals
from the 4M Fund.
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NOTE 2 – CASH AND INVESTMENTS (CONTINUED)
Investments are subject to various risks, the following of which are considered the most significant:
Credit Risk – This is the risk that an issuer or other counterparty to an investment will not fulfill its
obligations. Minnesota Statutes limit the City’s investments to direct obligations or obligations
guaranteed by the United States or its agencies; shares of investment companies registered under the
Federal Investment Company Act of 1940 that receive the highest credit rating, are rated in one of the
two highest rating categories by a statistical rating agency, and all of the investments have a final
maturity of 13 months or less; general obligations rated “A” or better; revenue obligations rated “AA”
or better; general obligations of the Minnesota Housing Finance Agency rated “A” or better; bankers’
acceptances of United States banks eligible for purchase by the Federal Reserve System; commercial
paper issued by United States corporations or their Canadian subsidiaries, rated of the highest quality
category by at least two nationally recognized rating agencies, and maturing in 270 days or le ss;
Guaranteed Investment Contracts guaranteed by a United States commercial bank, domestic branch of
a foreign bank, or a United States insurance company, and with a credit quality in one of the top
two highest categories; repurchase or reverse purchase agreements and securities lending agreements
with financial institutions qualified as a “depository” by the government entity, with banks that are
members of the Federal Reserve System with capitalization exceeding $10,000,000; that are a primary
reporting dealer in U.S. government securities to the Federal Reserve Bank of New York; or certain
Minnesota securities broker-dealers. The City’s investment policies do not further address credit risk.
Custodial Credit Risk – For investments, this is the risk that in the event of a failure of the counterparty
to an investment transaction (typically a broker-dealer) the City would not be able to recover the value
of its investments or collateral securities that are in the possession of an outside party. The City does
not have a formal investment policy addressing this risk, but typically limits its exposure by purchasing
insured or registered investments, or by control of who holds the securities.
Concentration Risk – This is the risk associated with investing a significant portion of the City’s
investment (considered 5.0 percent or more) in the securities of a single issuer, excluding
U.S. guaranteed investments (such as treasuries), investment pools, and mutual funds. The City’s
investment policies do not limit the concentration of investments. As of December 31, 2020, the City
had 5.0 percent invested in securities issued by the Federal Farm Credit Bank.
Interest Rate Risk – This is the risk of potential variability in the fair value of fixed rate investments
resulting from changes in interest rates (the longer the period for which an interest rate is fixed, the
greater the risk). The City does not have an investment policy limiting the duration of investments.
NOTE 3 – LOAN RECEIVABLES
The City has made several business subsidy loans to local businesses, some of which were funded with
grant proceeds received from Hennepin County. The terms and periods of repayment vary with each loan.
Loans receivable in the Economic Development Authority Special Revenue Fund at December 31, 2020
totaled $240,500. Loans receivable in nonmajor governmental funds totaled $21,016.
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NOTE 4 – INTERFUND BALANCES AND TRANSFERS
The composition of internal balances as of December 31, 2020 is as follows:
Receivable Fund Payable Fund Amount Purpose
Due from/to other funds
Governmental Business-type
General Fund Ice Arena 156,685$ Cash flow
Governmental Governmental
Nonmajor governmental Street Infrasturcture 75,000 Finance capital purchase
Total due from/to other funds 231,685
Advances to/from other funds
Governmental Governmental
Economic Development Authority HRA Construction 1,653,364 Finance capital purchase
Economic Development Authority HRA Bonds 351,116 Finance capital purchase
HRA Construction HRA Bonds 2,003,318 Finance capital purchase
Nonmajor governmental Street Infrasturcture 375,000 Finance capital purchase
Total advances from/to other funds 4,382,798
Interfund activity eiminated from government-wide statements (4,457,798)
Internal service fund activities related to the enterprise funds 257,622
Total internal balances – government-wide statements 414,307$
In 2020, the General Fund loaned the Ice Arena Fund $156,685 for cash flow purposes, the balance on the
loan will be paid back in 2021.The Economic Development Authority Special Revenue Fund loaned the
HRA Construction Capital Projects Fund $2,433,162 in 2008, for the purchase of land at Bass Lake Road.
The interfund loan matures in 2028 and carries an interest rate of 4.00 percent. As of December 31, 2020,
the balance outstanding was $1,653,364. In 2016, the Temporary Financing Fund loaned the Street
Infrastructure Capital Projects Fund $750,000 to fund future capital purchases. The loan will be paid back
over a 10-year period with a 2.00 percent interest rate. As of December 31, 2020, the balance outstanding
was $450,000. The Economic Development Authority Special Revenue Fund and the HRA Construction
Capital Projects Fund loaned the HRA Bonds Debt Service Fund $351,116 and $2,003,318, respectively,
for the purchase of the Hy-Vee property. The interfund loan matures in 2042 and carries an interest rate of
4.00 percent.
Interfund transfers during the year ended December 31, 2020 were as follows:
Nonmajor Ice Arena
General Governmental Enterprise Total
Transfer Out
Economic Development Authority 35,619$ (1)–$ –$ 35,619$
Street Infrastructure – 10,588 (3)– 10,588
Nonmajor governmental 51,800 (2)68,785 (4)400,000 (5)520,585
Sewer Utility Enterprise 55,564 (2)– – 55,564
Water Utility Enterprise 57,939 (2)– – 57,939
Golf Course Enterprise 10,769 (2)– – 10,769
Ice Arena Enterprise 10,769 (2)– – 10,769
Storm Water Enterprise 24,220 (2)– – 24,220
Internal Service 92,608 (2)– – 92,608
Total 339,288$ 79,373$ 400,000$ 818,661$
(1)Transfer to reimburse the General Fund for the aerial lease payment to West Metro Fire-Rescue District.
(2)Transfers to cover administrative charges paid for by the General Fund.
(3)Transfer to close nonmajor governmental 2016 Street Improvement Project Capital Projects Fund.
(4)Transfer from nonmajor governmental 2010B G.O. Equipment Bonds Debt Service Fund to nonmajor governmental
Fire Capital Projects Fund for future fire equipment purchases.
(5)Transfer from nonmajor governmental Park Infrastructure Capital Projects Fund to Ice Arena Enterprise Fund for debt
service and capital improvements costs.
Transfers In
Funds
-48-
NOTE 5 – CAPITAL ASSETS
Capital asset activity for the year ended December 31, 2020 was as follows:
A. Changes in Capital Assets Used in Governmental Activities
Beginning
of Year Additions Deletions End of Year
Capital assets, not depreciated
Land 994,268$ –$ –$ 994,268$
Construction in progress 32,059,543 8,236,837 (20,357,082) 19,939,298
Total capital assets, not depreciated 33,053,811 8,236,837 (20,357,082) 20,933,566
Capital assets, depreciated
Buildings and structures 9,367,855 18,774,744 (2,733,930) 25,408,669
Vehicles and equipment 10,839,831 537,758 (846,199) 10,531,390
Improvements other than buildings 46,133,939 1,636,110 (542,912) 47,227,137
Total capital assets, depreciated 66,341,625 20,948,612 (4,123,041) 83,167,196
Less accumulated depreciation on
Buildings and structures (6,969,667) (249,252) 1,945,551 (5,273,368)
Vehicles and equipment (8,514,438) (517,691) 846,199 (8,185,930)
Improvements other than buildings (15,618,094) (2,224,608) 535,148 (17,307,554)
Total accumulated depreciation (31,102,199) (2,991,551) 3,326,898 (30,766,852)
Net capital assets, depreciated 35,239,426 17,957,061 (796,143) 52,400,344
Total capital assets, net 68,293,237$ 26,193,898$ (21,153,225)$ 73,333,910$
B. Changes in Capital Assets Used in Business-Type Activities
Beginning
of Year Additions Deletions End of Year
Capital assets, not depreciated
Land 485,042$ –$ –$ 485,042$
Construction in progress 798,951 1,273,955 (702,082) 1,370,824
Total capital assets, not depreciated 1,283,993 1,273,955 (702,082) 1,855,866
Capital assets, depreciated
Buildings and structures 10,912,208 – (114,844) 10,797,364
Vehicles and equipment 2,635,207 55,358 (185,409) 2,505,156
Improvements other than buildings 27,865,215 657,484 – 28,522,699
Total capital assets, depreciated 41,412,630 712,842 (300,253) 41,825,219
Less accumulated depreciation on
Buildings and structures (4,762,831) (212,181) 114,844 (4,860,168)
Vehicles and equipment (2,235,229) (84,459) 182,026 (2,137,662)
Improvements other than buildings (6,640,340) (706,415) – (7,346,755)
Total accumulated depreciation (13,638,400) (1,003,055) 296,870 (14,344,585)
Net capital assets, depreciated 27,774,230 (290,213) (3,383) 27,480,634
Total capital assets, net 29,058,223$ 983,742$ (705,465)$ 29,336,500$
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NOTE 5 – CAPITAL ASSETS (CONTINUED)
C. Depreciation Expense by Function
Depreciation expense for the year ended December 31, 2020 was charged to the following functions:
Governmental activities
General government 77,047$
Public safety 64,565
Public works 1,946,363
Culture and recreation 326,005
Internal service 577,571
Total depreciation expense – governmental activities 2,991,551$
Business-type activities
Sewer utility 184,090$
Water utility 325,447
Golf course 36,503
Ice arena 195,894
Storm water 241,636
Street lighting 19,485
Total depreciation expense – business-type activities 1,003,055$
NOTE 6 – LONG-TERM LIABILITIES
A. General Obligation (G.O.) Bonds
The City issues G.O. bonds to provide funds for the acquisition and construction of major capital facilities.
G.O. bonds have been issued for both governmental and business-type activities. These bonds are reported
in the proprietary funds if they are expected to be repaid from proprietary fund revenues.
The following G.O. bonds will be repaid from future tax levies:
Final Balance –
Description Original Issue Interest Rate Issue Date Maturity Date End of Year
G.O. Street Reconstruction Bonds, Series 2015B 3,825,000$ 2.25–3.00%12/30/2015 02/01/2031 2,970,000$
G.O. Street Reconstruction Bonds, Series 2016A 4,855,000 2.25–3.00%12/29/2016 02/01/2033 4,325,000
G.O. Street Reconstruction Bonds, Series 2017A 18,435,000 3.00–5.00%12/28/2017 02/01/2034 17,530,000
G.O. Street Reconstruction Bonds, Series 2018A 9,520,000 3.25–5.00%12/20/2018 02/01/2035 9,520,000
G.O. Street Reconstruction Bonds, Series 2019A 5,235,000 3.00–4.00%07/18/2019 02/01/2035 5,235,000
Total General Obligation Bonds 39,580,000$
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NOTE 6 – LONG-TERM LIABILITIES (CONTINUED)
The annual debt service to maturity for G.O. bonds are as follows:
Year Ending
December 31,Principal Interest Principal Interest Principal Interest
2021 1,964,735$ 1,303,423$ 220,265$ 191,229$ 2,185,000$ 1,494,652$
2022 2,038,688 1,221,372 231,312 174,469 2,270,000 1,395,841
2023 2,132,217 1,125,983 237,783 159,549 2,370,000 1,285,532
2024 2,233,460 1,028,748 246,540 145,183 2,480,000 1,173,931
2025 2,324,080 938,824 250,920 130,945 2,575,000 1,069,769
2026–2030 13,066,475 3,217,240 1,358,525 424,188 14,425,000 3,641,428
2031–2035 12,652,305 915,598 622,695 55,482 13,275,000 971,080
36,411,960$ 9,751,188$ 3,168,040$ 1,281,045$ 39,580,000$ 11,032,233$
Governmental Activities Business-Type Activities Total
B. G.O. Tax Increment Bonds
The following bonds were issued for development purposes. The additional tax increment resulting from
the increased tax capacity of the redeveloped properties has been pledged to retire the related debt. Tax
increment revenues are projected to produce over 55 percent of the debt service requirements over the life
of the bonds. For the current year, principal and interest paid and total related tax increment revenues were
$665,000 and $197,602, respectively.
Final Balance –
Description Original Issue Interest Rate Issue Date Maturity Date End of Year
G.O. Tax Increment Refunding Bonds, Series, 2012A 2,695,000$ 2.00–2.45%01/11/2012 02/01/2025 1,305,000$
G.O. Tax Increment Refunding Bonds, Series, 2012B 1,330,000 1.35–4.65%01/11/2012 02/01/2031 1,005,000
G.O. Tax Increment Refunding Bonds, Series, 2015A 5,960,000 2.00–3.00%06/17/2015 02/01/2032 4,915,000
Total G.O. Tax Increment Bonds 7,225,000$
The annual debt service to maturity for G.O. bonds are as follows:
Year Ending
December 31,Principal Interest Principal Interest Principal Interest
2021 584,150$ 152,446$ 95,850$ 31,231$ 680,000$ 183,677$
2022 602,871 139,876 97,129 29,302 700,000 169,178
2023 621,558 126,424 98,442 27,346 720,000 153,770
2024 638,933 111,914 101,067 25,351 740,000 137,265
2025 657,620 96,307 102,380 23,291 760,000 119,598
2026–2030 2,052,412 290,895 552,588 75,987 2,605,000 366,882
2031–2032 776,776 22,840 243,224 7,344 1,020,000 30,184
5,934,320$ 940,702$ 1,290,680$ 219,852$ 7,225,000$ 1,160,554$
Business-Type ActivitiesGovernmental Activities Total
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NOTE 6 – LONG-TERM LIABILITIES (CONTINUED)
C. Lease Revenue Bonds
The following bonds were issued to finance the energy conservation project and will be repaid primarily
with energy savings and revenues pledged from the Ice Arena Fund. Annual principal and interest payments
on the bonds are expected to require less than 8 percent of revenues from the Ice Arena Fund. Principal and
interest paid for the current year and total customer revenues for the Ice Arena Fund were $57,482 and
$560,316, respectively.
Final Balance –
Description Original Issue Interest Rate Issue Date Maturity Date End of Year
2011A Taxable Lease Revenue Bonds 3,505,000$ 5.00%12/01/2011 12/01/2028 3,505,000$
The annual debt service to maturity for all lease revenue bonds are as follows:
Year Ending
December 31,Principal Interest
2021 –$ 57,482$
2022 – 57,482
2023 – 57,482
2024 – 57,482
2025 – 57,482
2026–2028 3,505,000 172,446
3,505,000$ 459,856$
Business-Type Activities
D. G.O. Revenue Bonds and Notes
The following bonds and notes were issued to finance capital improvements in the enterprise funds. They
will be repaid from future revenues pledged from the Sewer Utility, Water Utility, and Storm Water Funds
and are backed by the taxing power of the City. Annual principal and interest payments on the bonds are
expected to require less than 3, 6, and 12 percent of revenues from the Sewer Utility, Water Utility, and
Storm Water Funds, respectively. Principal and interest paid for the current year and total c ustomer
revenues for the Sewer Utility Fund were $95,664 and $3,712,613, respectively. Principal and interest paid
for the current year and total customer revenues for the Water Utility Fund were $421,591 and $5,139,616,
respectively. Principal and interest paid for the current year and total customer revenues for the Storm Water
Fund were $191,817 and $1,259,707, respectively.
Final Balance –
Description Original Issue Interest Rate Issue Date Maturity Date End of Year
2010A G.O. Utility Revenue Bonds 1,200,000$ 2.00–3.25%05/06/2010 02/01/2021 85,000$
2010B G.O. Water Revenue Refunding Bonds 605,000 2.00–3.00%11/23/2010 02/01/2022 125,000
2011 G.O. Public Facilities Authority Note 411,738 1.70%02/23/2011 08/20/2029 211,000
2013 G.O. Public Facilities Authority Note 1,035,000 1.00%07/24/2013 08/20/2032 688,000
Total G.O. Revenue Bonds and Notes 1,109,000$
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NOTE 6 – LONG-TERM LIABILITIES (CONTINUED)
The annual debt service to maturity for G.O. revenue bonds are as follows:
Year Ending
December 31,Principal Interest
2021 221,000$ 14,705$
2022 142,000 10,534
2023 78,000 8,634
2024 79,000 7,692
2025 79,000 6,741
2026–2030 389,000 19,036
2031–2032 121,000 1,820
1,109,000$ 69,162$
Business-Type Activities
E. Changes in Long-Term Liabilities
Long-term liability activity for the year ended December 31, 2020, was as follows:
Beginning Due Within
of Year Additions Deletions End of Year One Year
Governmental activities
Bonds payable
G.O. bonds 37,746,072$ –$ 1,334,112$ 36,411,960$ 1,964,735$
G.O. tax increment bonds 6,506,098 – 571,778 5,934,320 584,150
Add – premiums on bonds 2,763,227 – 173,441 2,589,786 –
Total bonds payable, net 47,015,397 – 2,079,331 44,936,066 2,548,885
Compensated absences 753,881 761,905 672,330 843,456 84,346
Total governmental activities 47,769,278 761,905 2,751,661 45,779,522 2,633,231
Business-type activities
Bonds payable
G.O. bonds 3,383,928 – 215,888 3,168,040 220,265
G.O. tax increment bonds 1,383,902 – 93,222 1,290,680 95,850
Lease revenue bonds 3,505,000 – – 3,505,000 –
G.O. revenue bonds and notes 1,325,000 – 216,000 1,109,000 221,000
Add – premiums on bonds 145,843 – 9,351 136,492 –
Less – bond discount (803) – (803) – –
Total business-type activities 9,742,870 – 533,658 9,209,212 537,115
Total government-wide 57,512,148$ 761,905$ 3,285,319$ 54,988,734$ 3,170,346$
Internal service funds predominantly serve the governmental funds. Accordingly, long-term liabilities for
internal service funds are included as part of the above totals for governmental activities.
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NOTE 7 – COMPONENTS OF FUND BALANCE
At December 31, 2020, the City had the following fund balances:
Economic
Development HRA City Hall Street
General Authority Construction CIP Infrastructure
Nonspendable 24,499$ –$ –$ –$ –$
Restricted
Economic development – – 5,379,088 – –
Capital improvements – – – – –
Debt service – – – – –
Public safety – police expenditures – – – – –
Ice arena – – – – –
Total restricted – – 5,379,088 – –
Committed
Economic development – 4,320,456 – – –
Solid waste operations – – – – –
Total committed – 4,320,456 – – –
Assigned
City Hall improvements – – – 1,217,360 –
Street improvements – – – – 250,697
General improvements – – – – –
Capital equipment – – – – –
Park improvements – – – – –
Total assigned – – – 1,217,360 250,697
Unassigned 8,901,587 – – – –
Total 8,926,086$ 4,320,456$ 5,379,088$ 1,217,360$ 250,697$
Park/Pool Other
Improvement Governmental
Project HRA Bonds Funds Total
Nonspendable –$ –$ –$ 24,499$
Restricted
Economic development – – – 5,379,088
Capital improvements 650,336 – – 650,336
Debt service – – 2,845,806 2,845,806
Public safety – police expenditures – – 135,571 135,571
Ice arena – – 5,505 5,505
Total restricted 650,336 – 2,986,882 9,016,306
Committed
Economic development – – 97,267 4,417,723
Solid waste operations – – 221,667 221,667
Total committed – – 318,934 4,639,390
Assigned
City Hall improvements – – – 1,217,360
Street improvements – – – 250,697
General improvements – – 3,249,809 3,249,809
Capital equipment – – 823,809 823,809
Park improvements – – 1,451,725 1,451,725
Total assigned – – 5,525,343 6,993,400
Unassigned – (2,119,802) (129) 6,781,656
Total 650,336$ (2,119,802)$ 8,831,030$ 27,455,251$
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE
A. Plan Descriptions
The City participates in the following cost-sharing, multiple-employer defined benefit pension plans
administered by the Public Employees Retirement Association (PERA) of Minnesota. The PERA’s defined
benefit pension plans are established and administered in accordance with Minnesota Statutes, Chapters 353
and 356. The PERA’s defined benefit pension plans are tax qualified plans under Section 401(a) of the
Internal Revenue Code (IRC).
1. General Employees Retirement Fund (GERF)
All full-time and certain part-time employees of the City are covered by the GERF. The GERF
members belong to the Coordinated Plan. Coordinated Plan members are covered by Social
Security.
2. Public Employees Police and Fire Fund (PEPFF)
The Public Employees Police and Fire Fund (PEPFF), originally established for police officers and
firefighters not covered by a local relief association, now covers all police officers and firefighters
hired since 1980. Effective July 1, 1999, the PEPFF also covers police officers and firefighters
belonging to local relief associations that elected to merge with and transfer assets and
administration to the PERA.
B. Benefits Provided
The PERA provides retirement, disability, and death benefits. Benefit provisions are established by state
statutes and can only be modified by the State Legislature. 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.
1. GERF Benefits
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. Two methods are used to compute
benefits for the PERA’s Coordinated Plan members. Members hired prior to July 1, 1989, receive
the higher of Method 1 or Method 2 formulas. Only Method 2 is used for members hired after
June 30, 1989. Under Method 1, the accrual rate for Coordinated Plan members is 1.2 percent of
average salary for each of the first 10 years of service, and 1.7 perc ent of average salary for each
additional year. Under Method 2, the accrual rate for Coordinated Plan members is 1.7 percent of
average salary for all years of service. For members hired prior to July 1, 1989, a full annuity is
available when age plus years of service equal 90, and normal retirement age is 65. For members
hired on or after July 1, 1989, normal retirement age is the age for unreduced Social Security
benefits capped at age 66.
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
Annuities, disability benefits, and survivor benefits are increased effective every January 1.
Beginning January 1, 2019, the post-retirement increase will be equal to 50.0 percent of the cost of
living adjustment (COLA) announced by the Social Security Administration, with a minimum
increase of at least 1.0 percent and a maximum of 1.5 percent. Recipients that have been receiving
the annuity or benefit for at least a full year as of the June 30 before the effective date of the
increase, will receive the full increase. For recipients receiving the annuity or benefit for at least
one month, but less than a full year as of the June 30 before the effective date of the increase, will
receive a reduced prorated increase. For members retiring on January 1, 2024 or later, the increase
will be delayed until normal retirement age (age 65 if hired prior to July 1, 1989, or age 66 for
individuals hired on or after July 1, 1989). Members retiring under Rule of 90 are exempt from the
delay to normal retirement.
2. PEPFF Benefits
Benefits for the PEPFF members first hired after June 30, 2010 but before July 1, 2014, vest on a
prorated basis from 50.0 percent after five years, up to 100.0 percent after 10 years of credited
service. Benefits for the PEPFF members first hired after June 30, 2014 vest on a prorated basis
from 50.0 percent after 10 years, up to 100.0 percent after 20 years of credited service. The annuity
accrual rate is 3.0 percent of average salary for each year of service. For Police and Fire Plan
members who were first hired prior to July 1, 1989, a full annuity is available when age plus years
of service equal at least 90.
Benefit increases are provided to benefit recipients each January. Beginning in 2019, the
post-retirement increase will be fixed at 1.0 percent. Recipients that have been receiving the annuity
or benefit for at least 36 months as of the June 30 before the effective date of the increase, will
receive the full increase. For recipients receiving the annuity or benefit for at least 25 months, but
less than 36 months as of the June 30 before the effective date of the increase, will receive a reduced
prorated increase.
C. Contributions
Minnesota Statutes, Chapter 353 sets the rates for employer and employee contributions. Contribution rates
can only be modified by the State Legislature.
1. GERF Contributions
Coordinated Plan members were required to contribute 6.50 percent of their annual covered salary
in fiscal year 2020. The City was required to contribute 7.50 percent for Coordinated Plan members.
The City’s contributions to the GERF for the year ended December 31, 2020, were $344,227. The
City’s contributions were equal to the required contributions as set by state statutes.
2. PEPFF Contributions
Police and fire member’s contribution rates increased from 11.30 percent of pay to 11.80 percent
and employer rates increased from 16.95 percent to 17.70 percent on January 1, 2020. The City’s
contributions to the PEPFF for the year ended December 31, 2020, were $550,681. The City’s
contributions were equal to the required contributions as set by state statutes.
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
D. Pension Costs
1. GERF Pension Costs
At December 31, 2020, the City reported a liability of $3,753,156 for its proportionate share of the
GERF’s net pension liability. The City’s net pension liability reflected a reduction, due to the state
of Minnesota’s contribution of $16.0 million. The state of Minnesota is considered a nonemployer
contributing entity and the state’s contribution meets the definition of a special funding situation.
The net pension liability was measured as of June 30, 2020, and the total pension liability used to
calculate the net pension liability was determined by an actuarial valuation as of that date. The
City’s proportion of the net pension liability was based on the City’s contributions received by the
PERA during the measurement period for employer payroll paid dates from July 1, 2019 through
June 30, 2020, relative to the total employer contributions received from all of the PERA’s
participating employers. The City’s proportionate share was 0.0626 percent at the end of the
measurement period and 0.0609 percent for the beginning of the period.
The amount recognized by the City as its proportionate share of the net pension liability, the direct
aid, and total portion of the net pension liability that was associated with the City were as follows:
City’s proportionate share of the net pension liability 3,753,156$
State’s proportionate share of the net pension liability
associated with the City 115,680$
For the year ended December 31, 2020, the City recognized pension expense of $182,169 for its
proportionate share of the GERF’s pension expense. In addition, the City recognized an additional
$10,068 as pension expense (and grant revenue) for its proportionate share of the state of
Minnesota’s contribution of $16.0 million to the GERF.
At December 31, 2020, the City reported its proportionate share of the GERF’s deferred outflows
of resources and deferred inflows of resources related to pensions from the following sources:
Deferred Deferred
Outflows Inflows
of Resources of Resources
Differences between expected and actual economic experience 33,268$ –$
Changes in actuarial assumptions – 14,200
Differences between projected and actual investment earnings 80,934 136,353
Changes in proportion 115,786 –
Contributions paid to the PERA subsequent to the
measurement date 172,250 –
Total 402,238$ 150,553$
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
A total of $172,250 reported as deferred outflows of resources related to pensions resulting from
city contributions subsequent to the measurement date that will be recognized as a reduction of the
net pension liability in the year ending December 31, 2021. Other amounts reported as deferred
outflows and deferred inflows of resources related to pensions will be recognized in pension
expense as follows:
Pension
Year Ending Expense
December 31,Amount
2021 (142,842)$
2022 36,898$
2023 94,703$
2024 90,676$
2. PEPFF Pension Costs
At December 31, 2020, the City reported a liability of $3,821,192 for its proportionate share of the
PEPFF’s net pension liability. The net pension liability was measured as of June 30, 2020, and the
total pension liability used to calculate the net pension liability was determined by an actuarial
valuation as of that date. The City’s proportion of the net pension liability was based on the City’s
contributions received by the PERA during the measurement period for employer payroll paid dates
from July 1, 2019 through June 30, 2020, relative to the total employer contributions received from
all of the PERA’s participating employers. The City’s proportionate share was 0.2899 percent at
the end of the measurement period and 0.3012 percent for the beginning of the period.
The state of Minnesota also contributed $13.5 million to the Police and Fire Fund in the plan fiscal
year ended June 30, 2020. The contribution consisted of $4.5 million in direct state aid that does
meet the definition of a special funding situation and $9.0 million in fire state aid that does not meet
the definition of a special funding situation. The $4.5 million direct state was paid on October 1,
2019. Thereafter, by October 1 of each year, the state will pay $9.0 million to the Police and Fire
Fund until full funding is reached or July 1, 2048, whichever is earlier. The $9.0 million in fire state
aid will continue until the fund is 90.0 percent funded, or until the State Patrol Plan (administered
by the Minnesota State Retirement System) is 90.0 percent funded, whichever occurs later.
As a result, the state of Minnesota is included as a nonemployer contributing entity in the Police
and Fire Retirement Plan Schedule of Employer Allocations and Schedule of Pension Amounts by
Employer, Current Reporting Period Only (pension allocation schedules) for the $4.5 million in
direct state aid. Police and Fire Plan employers need to recognize their proportionate share of the
state of Minnesota’s pension expense (and grant revenue) under GASB Statement No. 68 special
funding situation accounting and financial reporting requirements. For the year ended
December 31, 2020, the City recognized pension expense of $788,181 for its proportionate share
of the Police and Fire Plan’s pension expense. In addition, the City recognized an additional
$27,693 as pension expense (and grant revenue) for its proportionate share of the state of
Minnesota’s contribution of $4.5 million to the Police and Fire Fund.
The amount recognized by the City as its proportionate share of the net pension liability, the direct
aid, and total portion of the net pension liability that was associated with the City were as follows:
City’s proportionate share of the net pension liability 3,821,192$
State’s proportionate share of the net pension liability
associated with the City 90,012$
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
The state of Minnesota is not included as a nonemployer contributing entity in the Police and Fire
Pension Plan pension allocation schedules for the $9.0 million in fire state aid. The City also
recognized $26,091 for the year ended December 31, 2020, as revenue and an offsetting reduction
of net pension liability for its proportionate share of the state of Minnesota ’s on-behalf
contributions to the Police and Fire Fund.
At December 31, 2020, the City reported its proportionate share of the PEPFF’s deferred outflows
of resources and deferred inflows of resources related to pensions from the following sources:
Deferred Deferred
Outflows Inflows
of Resources of Resources
Differences between expected and actual economic experience 168,833$ 184,032$
Changes in actuarial assumptions 1,298,672 2,323,833
Differences between projected and actual investment earnings 126,729 –
Changes in proportion 156,743 260,899
Contributions paid to the PERA subsequent to the
measurement date 261,298 –
Total 2,012,275$ 2,768,764$
A total of $261,298 reported as deferred outflows of resources related to pensions resulting from
city contributions subsequent to the measurement date that will be recognized as a reduction of the
net pension liability in the year ending December 31, 2021. Other amounts reported as deferred
outflows and inflows of resources related to pensions will be recognized in pension expense as
follows:
Pension
Year Ending Expense
December 31,Amount
2021 (257,797)$
2022 (1,093,130)$
2023 183,128$
2024 167,398$
2025 (17,386)$
E. Actuarial Assumptions
The total pension liability in the June 30, 2020 actuarial valuation was determined using an individual
entry-age normal actuarial cost method and the following actuarial assumptions:
GERF PEPFF
Inflation 2.25% per year 2.50% per year
Active member payroll growth 3.00% per year 3.25% per year
Investment rate of return 7.50%7.50%
Salary increases were based on a service-related table. Mortality rates for active members, retirees,
survivors, and disabilitants for all plans were based on RP-2014 tables for males and females, as
appropriate, with slight adjustments to fit the PERA’s experience. Cost of living benefit increases after
retirement for retirees are assumed to be 1.25 percent per year for the GERF, and 1.00 percent per year for
the PEPFF.
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
Actuarial assumptions used in the June 30, 2020 valuation were based on the results of actuarial experience
studies. The most recent four-year experience study in the GERF was completed in 2019. The assumption
changes were adopted by the Board and become effective with the July 1, 2020 actuarial valuation. The
most recent four-year experience study for the PEPFF was completed in 2020. The recommended
assumptions for those plans were adopted by the Board and will be effective with the July 1, 2021 actuarial
valuations if approved by the State Legislature.
The following changes in actuarial assumptions and plan provisions occurred in 2020:
1. GERF
CHANGES IN ACTUARIAL ASSUMPTIONS
• The price inflation assumption was decreased from 2.50 percent to 2.25 percent.
• The payroll growth assumption was decreased from 3.25 percent to 3.00 percent.
• Assumed salary increase rates were changed as recommended in the June 30, 2019 experience
study. The net effect is assumed rates that average 0.25 percent less than previous rates.
• Assumed rates of retirement were changed as recommended in the June 30, 2019 experience
study. The changes result in more unreduced (normal) retirements and slightly fewer Rule of 90
and early retirements.
• Assumed rates of termination were changed as recommended in the June 30, 2019 experience
study. The new rates are based on service and are generally lower than the previous rates for
years two through five, and slightly higher thereafter.
• Assumed rates of disability were changed as recommended in the June 30, 2019 experience
study. The change results in fewer predicted disability retirements for males and females.
• The base mortality table for healthy annuitants and employees was changed from the
RP-2014 Table to the Pub-2010 General Mortality Table, with adjustments. The base mortality
table for disabled annuitants was changed from the RP-2014 Disabled Annuitant Mortality
Table to the Pub-2010 General/Teacher Disabled Annuitant Mortality Table, with adjustments.
• The mortality improvement scale was changed from MP-2018 to MP-2019.
• The assumed spouse age difference was changed from two years older for females to one year
older.
• The assumed number of married male new retirees electing the 100.00 percent joint and
survivor option changed from 35.00 percent to 45.00 percent. The assumed number of married
female new retirees electing the 100.00 percent joint and survivor option changed from
15.00 percent to 30.00 percent. The corresponding number of married new retirees electing the
life annuity option was adjusted accordingly.
CHANGES IN PLAN PROVISIONS
• Augmentation for current privatized members was reduced to 2.00 percent for the period July 1,
2020 through December 31, 2023, and zero percent thereafter. Augmentatio n was eliminated
for privatizations occurring after June 30, 2020.
2. PEPFF
CHANGES IN ACTUARIAL ASSUMPTIONS
• The mortality projection scale was changed from MP-2018 to MP-2019.
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
The Minnesota State Board of Investment, which manages the investments of the PERA, prepares an
analysis of the reasonableness on a regular basis of the long-term expected rate of return using a
building-block method in which best-estimate ranges of expected future rates of return are developed for
each major asset class. These ranges are combined to produce an expected long-term rate of return by
weighting the expected future rates of return by the target asset allocation percentages. The target allocation
and best-estimates of geometric real rates of return for each major asset class are summarized in the
following table:
Asset Class
Domestic stocks 35.50 %5.10 %
International stocks 17.50 5.30 %
Bonds (fixed income)20.00 0.75 %
Alternative assets (private markets)25.00 5.90 %
Cash 2.00 – %
100.00 %
Target Long-Term Expected
Allocation Real Rate of Return
F. Discount Rate
The discount rate used to measure the total pension liability in 2020 was 7.50 percent. The projection of
cash flows used to determine the discount rate assumed that contributions from plan members and
employers will be made at rates set in Minnesota Statutes. Based on these assumptions, the fiduciary net
positions of the GERF and the PEPFF were projected to be available to make all projected future benefit
payments of current plan members. Therefore, the long-term expected rate of return on pension plan
investments was applied to all periods of projected benefit payments to determine the total pension liability.
G. Pension Liability Sensitivity
The following table presents the City’s proportionate share of the net pension liability for all plans it
participates in, calculated using the discount rate disclosed in the preceding paragraph, as well as what the
City’s proportionate share of the net pension liability would be if it were calculated using a discount rate
1 percentage point lower or 1 percentage point higher than the current discount rate:
1% Decrease in 1% Increase in
Discount Rate Discount Rate Discount Rate
6.50%7.50%8.50%
The City’s proportionate share of
the GERF net pension liability 6,015,007$ 3,753,156$ 1,887,310$
The City’s proportionate share of
the PEPFF net pension liability 7,616,186$ 3,821,192$ 681,500$
H. Pension Plan Fiduciary Net Position
Detailed information about each pension plan’s fiduciary net position is available in a separately issued
PERA financial report that includes financial statements and required supplementary information. That
report may be obtained on the PERA website at www.mnpera.org; by writing to the PERA at
60 Empire Drive, Suite 200, St. Paul, Minnesota 55103; or by calling (651) 296-7460 or (800) 652-9026.
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NOTE 9 – DEFINED CONTRIBUTION PENSION PLAN
Councilmembers of the City are covered by the Public Employees Defined Contribution Plan (PEDCP), a
multiple-employer deferred compensation plan administered by the PERA. The PEDCP is a tax qualified
plan under Section 401(a) of the IRC, and all contributions by or on behalf of employees are tax deferred
until time of withdrawal.
Plan benefits depend solely on amounts contributed to the plan plus investment earnings, less administrative
expenses. Minnesota Statutes, Chapter 353D.03, specifies plan provisions, including the employee and
employer contribution rates for those qualified personnel who elect to participate. An eligible elected
official who decides to participate contributes 5.00 percent of their salary, which is matched by the elected
official’s employer. For ambulance service personnel, employer contributions are determined by the
employer, and for salaried employees, contributions must be a fixed percentage of salary. Employer
contributions for volunteer personnel may be a unit value for each call or period of alert duty. Employees
who are paid for their services may elect to make member contributions in an amount not to exceed the
employer share. Employer and employee contributions are combined and used to purchase shares in one or
more of the seven accounts of the Minnesota Supplemental Investment Fund. For administering the plan,
the PERA receives 2.00 percent of employer contributions and 25 hundredths of 1.00 percent (0.25 percent)
of the assets in each member’s account annually.
Total contributions made by the City during fiscal year 2020 were:
Required Rate
for Employees
Employee Employer Employee Employer and Employers
2,676$ 2,676$ 5.00%5.00%5.00%
Contribution Amount Percentage of Covered Payroll
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NOTE 10 – OTHER POST-EMPLOYMENT BENEFITS (OPEB) PLAN
A. Plan Description
The City administers a single-employer defined benefit healthcare plan (“the Retiree Health Plan”). The
plan provides healthcare insurance for eligible retirees and their eligible dependents through the City’s
group health insurance plan, which covers both active and retired members. Benefit provisions are
discussed and proposed by an insurance committee made up of employees from all employee groups (both
represented and nonunion), with the final approval of the plan being given by the city manager. The benefit
levels, employee contributions, and employer contributions are governed by the City and can be amended
by the City. The Retiree Health Plan does not issue a publicly available financial report.
At December 31, 2020, the following employees were covered by the benefit terms:
Retirees and beneficiaries receiving benefits 3
Active plan members 91
Total members 94
B. Funding Policy
All retirees of the City have the option under state law to continue their medical insurance coverage through
the City from the time of retirement until the employee reaches the age of eligibility for Medicare. For
members of all employee groups, the retiree must pay the full premium to continue coverage for medical
insurance. The City is legally required to include any retirees for whom it provides health insurance
coverage in the same insurance pool as its active employees. Consequently, participating retirees are
considered to receive a secondary benefit know as an “implicit rate subsidy.” This benefit relates to the
assumption that the retiree is receiving a more favorable premium rate than they would otherwise be able
to obtain if purchasing insurance on their own, due to being included in the same pool with the City’s
younger and statistically healthier active employees.
Contribution requirements are set by the City annually on a pay-as-you-go basis. The City contributes none
of the cost of current year premiums for eligible retired plan members and their dependents, except for the
implicit rate subsidy described above. For fiscal year 2020, the City’s average contribution rate was
0.3 percent of covered payroll. For the year 2020, the City contributed $22,038 to the Retiree Health Plan.
C. Actuarial Methods and Assumptions
The City’s total OPEB liability of $1,298,682 was measured as of December 31, 2020, and the total OPEB
liability used to calculate the total OPEB liability was determined by an actuarial valuation as of January 1,
2019, using the entry-age normal method. Roll forward procedures were used to roll forward the total OPEB
liability to the measurement date.
The total OPEB liability in the January 1, 2019 actuarial valuation was determined using the following
actuarial assumptions, applied to all periods included in the measurement, unless otherwise specified:
Discount rate 2.12%
Expected long-term investment return 2.12%
20-year municipal bond yield 2.12%
Inflation rate 2.75%
Payroll growth rate 3.25%
Healthcare cost trend rate 7.50% in 2020, grading to 5.00%
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NOTE 10 – OTHER POST-EMPLOYMENT BENEFITS (OPEB) PLAN (CONTINUED)
The discount rate used to measure the total OPEB liability was 2.12 percent. Assets were projected using
expected benefit payments and expected asset returns. Expected benefit payments by year were discounted
using the expected asset return assumption for years in which the assets were sufficient to pay all benefit
payments. Any remaining benefit payments after the Trust Fund is exhausted are discounted at the 20-year
municipal bond rate. The equivalent single rate is the discount rate.
Mortality rates were based on the RP-2014 with MP 2018 generational improvements.
The actuarial assumptions used in the January 1, 2019 valuation were based on input from a variety of
published sources of historical and projected future financial data. Each assumption was r eviewed for
reasonableness with the source information, as well as for consistency with the other economic
assumptions.
D. Changes in the Total OPEB Liability
Total OPEB
Liability
Beginning balance – January 1, 2020 1,126,706$
Changes for the year
Service cost 89,655
Interest 33,026
Difference between expected and actual experience 27
Changes of assumptions 71,306
Benefit payments (22,038)
Total net changes 171,976
Ending balance – December 31, 2020 1,298,682$
Since the prior measurement date, the following assumptions changed:
• The discount rate was changed from 2.74 percent to 2.12 percent.
• The salary increase was changed from 3.50 percent to 3.25 percent.
E. Sensitivity of the Total OPEB Liability
The following presents the total OPEB liability of the City, as well as what the City’s total OPEB liability
would be if it were calculated using a discount rate that is 1 percentage point lower (1.12 percent) or
1 percentage point higher (3.12 percent) than the current discount rate:
Discount rate
Total OPEB liability 1,416,000$ 1,191,048$
1.12%3.12%
1% Decrease in 1% Increase in
Discount Rate Discount RateDiscount Rate
1,298,682$
2.12%
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NOTE 10 – OTHER POST-EMPLOYMENT BENEFITS (OPEB) PLAN (CONTINUED)
The following presents the total OPEB liability of the City, as well as what the City’s total OPEB liability
would be if it were calculated using a healthcare cost trend rate that is 1 percentage point lower (6.50 percent
decreasing to 4.00 percent) or 1 percentage point higher (8.50 percent decreasing to 6.00 percent) than the
current healthcare cost trend rate:
Healthcare cost trend rate
Total OPEB liability 1,131,326$ 1,497,538$ 1,298,682$
1% Decrease in 1% Increase in
Cost Trend Rate Cost Trend Rate
6.50%, decreasing to 4.00%8.50%, decreasing to 6.00%
Healthcare
Cost Trend Rate
7.50%, decreasing to 5.00%
Healthcare Healthcare
F. OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related
to OPEB
For the year ended December 31, 2020, the City recognized OPEB expense of $136,460. At December 31,
2020, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB
from the following sources:
Deferred Deferred
Outflows Inflows
of Resources of Resources
Differences between expected and actual experience 68,474$ –$
Changes in assumptions 127,970 38,831
Total 196,444$ 38,831$
The amounts reported as deferred outflows and inflows of resources related to OPEB will be recognized in
OPEB expense as follows:
OPEB
Year Ending Expense
June 30,Amount
2021 $ 13,780
2022 $ 13,780
2023 $ 13,780
2024 $ 13,780
2025 $ 13,780
Thereafter $ 88,713
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NOTE 11 – JOINT POWERS AGREEMENT AND JOINTLY CONTROLLED ORGANIZATION
A. Joint Water Commission (JWC)
The City is a member of a joint powers agreement, together with the cities of Crystal and New Hope, which
established a JWC. The JWC was created in 1963 to provide for the creation and maintenance of a joint
water supply, storage, and distribution system through which water purchased from the City of Minneapolis
can be supplied to the population of the member cities.
Each member city is entitled to appoint one member to the JWC. Original construction costs were allocated
to the member cities based on percentages agreed upon in the joint powers agreement. All subsequent
operating and maintenance costs are apportioned to and paid by each member city on the basis of water
usage. Under the terms of the joint powers agreement, upon termination the accumulated assets of the JWC
shall be divided amongst the member cities in a manner to be determined and unanimously approved by
the member cities. Over the years, the costs of construction have been allocated among the member cities,
generally on the basis of water purchased. These costs were expensed as incurred by the City in the cost of
water purchased. The asset recorded in the Water Fund as an investment in the JWC for $168,509 represents
the original contributions for working capital; however, the City’s share of subsequent construction costs
are not determinable. Therefore, the City’s Water Fund has not recorded any subsequent amounts as an
equity investment or contributed capital related to the JWC.
The following financial information is from the JWC’s audited financial statements for the year ended
December 31, 2020, which are available at Golden Valley City Hall:
Total assets 19,788,683$
Total liabilities 1,358,265
Net position 18,430,418
Total revenue 9,155,074
Total expenses 8,327,643
Of the total revenues, $8,987,718 represented assessments paid by member cities. Of the total member
assessments, $3,090,099, or 34.38 percent, was paid by the City.
B. West Metro Fire-Rescue District
By a resolution dated August 25, 1997, the City Council approved entering into an agreement by which a
joint powers fire department would be established by merging the fire departments of New Hope and
Crystal. A joint and cooperative agreement created the joint powers fire department effective January 2,
1998, and operation began in July 1998, under the name West Metro Fire-Rescue District (the District).
The District is governed by a seven-member Board of Directors that includes one City Council member
from each City. As required by the agreement, the City transferred fire department equipment to the District,
while retaining its rights to these assets in the event of the District’s dissolution. The equipment had a net
book value of $374,558.
The following financial information is taken from the District’s audited financial statements for the year
ended December 31, 2020, the most recent information available at the date of this report:
Total assets 3,690,462$
Total deferred outflows of resources 482,860
Total liabilities 2,280,370
Total deferred inflows of resources 630,105
Net position 1,262,847
Total revenue 2,770,349
Total expenses 3,138,404
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NOTE 11 – JOINT POWERS AGREEMENT AND JOINTLY CONTROLLED ORGANIZATION
(CONTINUED)
The City’s equity interest and its share of the net income (loss) of the District are added to the value of the
“Investment in Joint Venture” in the government-wide financial statement under governmental activities.
As of December 31, 2020, the amount reported as investment in joint venture was $636,601.
According to a formula in the agreement, the City’s share of the District’s budget is 50.4 percent. Payments
to the District in 2020 totaled $1,297,690. The District’s financial statements for the period ended
December 31, 2020 are available at the District office located at: 4251 Xylon Avenue North, New Hope,
Minnesota 55428.
C. Shingle Creek Watershed Management Commission (SCWMC)
The City is one of nine member cities of the SCWMC, a joint powers organization formed to assist its
members’ preservation and use of natural water storage and retention systems. The City ’s contribution to
the SCWMC for its fiscal year ended December 31, 2020 was $28,934, representing 8.0 percent of
members’ contributions for the year.
D. Pets Under Police Security (PUPS)
The City has entered into a joint and cooperative agreement with five other cities to create an organization,
which provides efficient and economical impoundment of animals in a jointly owned and operated facility.
The City incurred charges of $12,123 for these services in 2020.
E. Hennepin Recycling Group (HRG)
The City is party to a joint powers agreement with two other cities to create an organization to collect,
recycle, and dispose of solid waste in compliance with the Minnesota Waste Management Act. HRG
contracts for collection and recycling activities and the City is billed for services provi ded to its residents.
In 2020, total charges of $230,614 were incurred for these services.
F. Bassett Creek Watershed Management Commission (BCWMC)
The City is one of nine member cities of the BCWMC, a joint powers organization formed to assist its
members’ preservation and use of natural water storage and retention systems. Each member city is entitled
to appoint one representative to the BCWMC Board. The nine-member Board develops a budget for the
year each July 1. Each member city contributes funds to cover the budgeted costs of operations based half
on the assessed valuation of all taxable property, and half on the total area each member city has within the
boundaries of the watershed. Any capital costs incurred by the BCWMC are apportioned to the members
based half on the real property valuation of each member city within the watershed, and half on the total
area each member city has within the boundaries of the watershed. The City’s 2020 contribution to the
BCWMC for its fiscal year ended January 31, 2021 was $28,987, representing 5.3 percent of member’s
contributions for the year.
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NOTE 12 – COMMITMENTS AND CONTINGENCIES
A. Legal Claims
The City generally follows the practice of recording liabilities resulting from claims and legal actions only
when they become fixed or determinable in amount. Management does not anticipate any significant losses
that would not be covered by insurance.
B. Federal and State Receivables
Amounts recorded or receivable from federal and state agencies are subject to agency audit and adjustment .
Any disallowed claims, including amounts already collected, may constitute a liability of the applicable
funds. The amount, if any, of claims which may be disallowed by the grantor agencies cannot be determined
at this time, although the City expects such amounts, if any, to be immaterial.
C. Tax Increment Districts
The City’s tax increment districts are subject to review by the Office of the State Auditor. Any disallowed
claims or misuse of tax increments could become a liability of the applicable fund. Management has
indicated that it is not aware of any instances of noncompliance, which would have a material effect on the
financial statements.
D. Construction Commitments
At December 31, 2020, the City is committed to various construction contracts for the improvement of city
property. The City’s remaining commitment under these contracts is approximately $887,000 at year-end.
E. Conduit Debt Obligations
At times, the City has issued industrial revenue bonds to provide financial assistance to private sector
entities for the acquisition and construction of industrial and commercial 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. The City is not obligated in any
manner for repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the
accompanying financial statements. As of December 31, 2020, there were five series of industrial revenue
bonds outstanding. The original issue amounts totaled $12,910,000 and have been reduced through annual
payments and partial call prepayments. The outstanding balance as of December 31, 2020 is undetermined.
NOTE 13 – SUBSEQUENT EVENTS
In February 2021, the City Council approved the sale of $2,020,000 of General Obligation Tax Abatement
Bonds, Series 2021A. The proceeds of this issue will be used to refinance the purchase of various energy
savings improvements to the New Hope Ice Arena. The bonds have an interest rate of 1.000 percent, and
have a final maturity date of December 1, 2028.
REQUIRED SUPPLEMENTARY INFORMATION
CITY OF NEW HOPE, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2020
Proportionate
Share of the
City’s Net Pension
Proportionate Liability and City’s
Share of the the City’s Proportionate Plan Fiduciary
State of Share of the Share of the Net Position
City’s City’s Minnesota’s State of Net Pension as a
PERA Fiscal Proportion Proportionate Proportionate Minnesota’s Liability as a Percentage
Year-End Date of the Net Share of the Share of the Share of the City’s Percentage of of the Total
(Measurement Pension Net Pension Net Pension Net Pension Covered Covered Pension
Date)Liability Liability Liability Liability Payroll Payroll Liability
06/30/2015 0.0617% 3,197,614$ –$ 3,197,614$ 3,627,658$ 88.15% 78.20%
06/30/2016 0.0608% 4,936,658$ 64,481$ 5,001,139$ 3,643,308$ 135.50% 68.90%
06/30/2017 0.0588% 3,753,753$ 47,225$ 3,800,978$ 3,931,388$ 95.48% 75.90%
06/30/2018 0.0599% 3,323,006$ 109,063$ 3,432,069$ 3,998,415$ 83.11% 79.50%
06/30/2019 0.0609% 3,367,025$ 104,662$ 3,471,687$ 4,282,511$ 78.62% 80.20%
06/30/2020 0.0626% 3,753,156$ 115,680$ 3,868,836$ 4,463,850$ 84.08% 79.10%
Contributions Contributions
in Relation to as a
Statutorily the Statutorily Contribution Percentage
Required Required Deficiency Covered of Covered
Contributions Contributions (Excess)Payroll Payroll
284,367$ 284,367$ –$ 3,791,560$ 7.50%
280,102$ 280,102$ –$ 3,734,693$ 7.50%
286,170$ 286,170$ –$ 3,815,600$ 7.50%
310,638$ 310,638$ –$ 4,141,835$ 7.50%
328,429$ 328,429$ –$ 4,379,059$ 7.50%
344,227$ 344,227$ –$ 4,589,689$ 7.50%
Note:
City of New Hope, Minnesota
PERA – General Employees Retirement Fund
Schedule of City’s and Nonemployer Proportionate Share of Net Pension Liability
Year Ended December 31, 2020
Year Ended December 31, 2020
PERA – General Employees Retirement Fund
Schedule of City Contributions
City Fiscal
Year-End
12/31/2015
12/31/2016
12/31/2017
City Fiscal
12/31/2018
12/31/2016
12/31/2017
The City implemented GASB Statement No.68 in fiscal 2015 (using a June 30,2015 measurement date).This schedule is intended to present
10-year trend information. Additional years will be added as they become available.
12/31/2018
12/31/2020
12/31/2020
12/31/2019
12/31/2019
Year-End
12/31/2015
-68-
Proportionate
Share of the
City’s Net Pension
Proportionate Liability and City’s
Share of the the City’s Proportionate Plan Fiduciary
State of Share of the Share of the Net Position
City’s City’s Minnesota’s State of Net Pension as a
PERA Fiscal Proportion Proportionate Proportionate Minnesota’s Liability as a Percentage
Year-End Date of the Net Share of the Share of the Share of the City’s Percentage of of the Total
(Measurement Pension Net Pension Net Pension Net Pension Covered Covered Pension
Date)Liability Liability Liability Liability Payroll Payroll Liability
06/30/2015 0.2820% 3,204,180$ –$ 3,204,180$ 2,579,768$ 124.20% 86.60%
06/30/2016 0.2940% 11,798,732$ –$ 11,798,732$ 2,732,301$ 431.82% 63.90%
06/30/2017 0.2820% 3,807,336$ –$ 3,807,336$ 2,992,514$ 127.23% 85.40%
06/30/2018 0.2888% 3,078,311$ –$ 3,078,311$ 3,043,700$ 101.14% 88.80%
06/30/2019 0.3012% 3,206,578$ –$ 3,206,578$ 3,176,028$ 100.96% 89.30%
06/30/2020 0.2899% 3,821,192$ 90,012$ 3,911,204$ 3,271,692$ 116.80% 87.20%
Contributions Contributions
in Relation to as a
Statutorily the Statutorily Contribution Percentage
Required Required Deficiency Covered of Covered
Contributions Contributions (Excess)Payroll Payroll
448,029$ 448,029$ –$ 2,765,611$ 16.20%
444,511$ 444,511$ –$ 2,743,893$ 16.20%
489,202$ 489,202$ –$ 3,019,768$ 16.20%
502,203$ 502,203$ –$ 3,100,017$ 16.20%
550,665$ 550,665$ –$ 3,248,759$ 16.95%
550,681$ 550,681$ –$ 3,111,189$ 17.70%
Note:
12/31/2018
12/31/2018
12/31/2019
12/31/2020
City of New Hope, Minnesota
PERA – Public Employees Police and Fire Fund
Schedule of City’s and Nonemployer Proportionate Share of Net Pension Liability
Year Ended December 31, 2020
12/31/2020
The City implemented GASB Statement No.68 in fiscal 2015 (using a June 30,2015 measurement date).This schedule is intended to present
10-year trend information. Additional years will be added as they become available.
City Fiscal
Year-End
12/31/2015
12/31/2016
12/31/2017
City Fiscal
Year-End
12/31/2015
12/31/2016
Year Ended December 31, 2020
Schedule of City Contributions
PERA – Public Employees Police and Fire Fund
12/31/2017
12/31/2019
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2018 2019 2020
Total OPEB liability
Service cost 64,269$ 72,745$ 89,655$
Interest 31,335 38,452 33,026
Differences between expected and actual experience – 81,871 27
Changes in assumptions (53,393) 74,709 71,306
Benefit payments (25,947) (16,942) (22,038)
Net change in total OPEB liability 16,264 250,835 171,976
Total OPEB liability – beginning of year 859,607 875,871 1,126,706
Total OPEB liability – end of year 875,871$ 1,126,706$ 1,298,682$
Covered payroll 6,400,000$ 7,100,000$ 7,400,000$
Total OPEB liability as a percentage of covered payroll 13.69%15.87%17.55%
Note: The City implemented GASB Statement No. 75 in fiscal 2018. This schedule is intended to present 10-year trend
information. Additional years will be added as they become available.
City of New Hope, Minnesota
Other Post-Employment Benefits Plan
Schedule of Changes in the City’s Total
OPEB Liability and Related Ratios
Year Ended December 31, 2020
Fiscal Year Ended December 31,
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City of New Hope, Minnesota
Notes to Required Supplementary Information
December 31, 2020
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PERA – GENERAL EMPLOYEES RETIREMENT FUND
2020 CHANGES IN ACTUARIAL ASSUMPTIONS
• The price inflation assumption was decreased from 2.50 percent to 2.25 percent.
• The payroll growth assumption was decreased from 3.25 percent to 3.00 percent.
• Assumed salary increase rates were changed as recommended in the June 30, 2019 experience
study. The net effect is assumed rates that average 0.25 percent less than previous rates.
• Assumed rates of retirement were changed as recommended in the June 30, 2019 experience
study. The changes result in more unreduced (normal) retirements and slightly fewer
Rule of 90 and early retirements.
• Assumed rates of termination were changed as recommended in the June 30, 2019 experience
study. The new rates are based on service and are generally lower than the previous rates for
years two through five, and slightly higher thereafter.
• Assumed rates of disability were changed as recommended in the June 30, 2019 experience
study. The change results in fewer predicted disability retirements for males and females.
• The base mortality table for healthy annuitants and employees was changed from the RP-2014
Table to the Pub-2010 General Mortality Table, with adjustments. The base mortality table for
disabled annuitants was changed from the RP-2014 Disabled Annuitant Mortality Table to the
Pub-2010 General/Teacher Disabled Annuitant Mortality Table, with adjustments.
• The mortality improvement scale was changed from MP-2018 to MP-2019.
• The assumed spouse age difference was changed from two years older for females to one year
older.
• The assumed number of married male new retirees electing the 100 percent joint and survivor
option changed from 35.00 percent to 45.00 percent. The assumed number of married female
new retirees electing the 100.00 percent joint and survivor option changed from 15.00 percent
to 30.00 percent. The corresponding number of married new retirees electing the life annuity
option was adjusted accordingly.
2020 CHANGES IN PLAN PROVISIONS
• Augmentation for current privatized members was reduced to 2.00 percent for the period July 1,
2020 through December 31, 2023, and zero percent thereafter. Augmentation was eliminated
for privatizations occurring after June 30, 2020.
City of New Hope, Minnesota
Notes to Required Supplementary Information (continued)
December 31, 2020
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PERA – GENERAL EMPLOYEES RETIREMENT FUND (CONTINUED)
2019 CHANGES IN ACTUARIAL ASSUMPTIONS
• The mortality projection scale was changed from MP-2017 to MP-2018
2019 CHANGES IN PLAN PROVISIONS
• The employer supplemental contribution was changed prospectively, decreasing from
$31.0 million to $21.0 million per year. The state’s special funding contribution was changed
prospectively, requiring $16.0 million due per year through 2031.
2018 CHANGES IN ACTUARIAL ASSUMPTIONS
• The mortality projection scale was changed from MP-2015 to MP-2017.
• The assumed benefit increase was changed from 1.00 percent per year through 2044, and
2.50 percent per year thereafter, to 1.25 percent per year.
2018 CHANGES IN PLAN PROVISIONS
• The augmentation adjustment in early retirement factors is eliminated over a five-year period
starting July 1, 2019, resulting in actuarial equivalence after June 30, 2024.
• Interest credited on member contributions decreased from 4.00 percent to 3.00 percent,
beginning July 1, 2018.
• Deferred augmentation was changed to zero percent, effective January 1, 2019. Augmentation
that has already accrued for deferred members will still apply.
• Contribution stabilizer provisions were repealed.
• Post-retirement benefit increases were changed from 1.00 percent per year with a provision to
increase to 2.50 percent upon attainment of 90.00 percent funding ratio to 50.00 percent of the
Social Security Cost of Living Adjustment, not less than 1.00 percent and not more than
1.50 percent, beginning January 1, 2019.
• For retirements on or after January 1, 2024, the first benefit increase is delayed until the retiree
reaches normal retirement age; does not apply to Rule of 90 retirees, disability benefit
recipients, or survivors.
• Actuarial equivalent factors were updated to reflect revised mortality and interest assumptions.
City of New Hope, Minnesota
Notes to Required Supplementary Information (continued)
December 31, 2020
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PERA – GENERAL EMPLOYEES RETIREMENT FUND (CONTINUED)
2017 CHANGES IN ACTUARIAL ASSUMPTIONS
• The Combined Service Annuity (CSA) loads were changed from 0.80 percent for active
members and 60.00 percent for vested and nonvested deferred members. The revised CSA
loads are now zero percent for active member liability, 15.00 percent for vested deferred
member liability, and 3.00 percent for nonvested deferred member liability.
• The assumed post-retirement benefit increase rate was changed from 1.00 percent per year for
all years, to 1.00 percent per year through 2044, and 2.50 percent per year thereafter.
2017 CHANGES IN PLAN PROVISIONS
• The state’s contribution for the Minneapolis Employees Retirement Fund equals $16.0 million
in 2017 and 2018, and $6.0 million thereafter.
• The Employer Supplemental Contribution for the Minneapolis Employees Retirement Fund
changed from $21.0 million to $31.0 million in calendar years 2019 to 2031. The state’s
contribution changed from $16.0 million to $6.0 million in calendar years 2019 to 2031.
2016 CHANGES IN ACTUARIAL ASSUMPTIONS
• The assumed post-retirement benefit increase rate was changed from 1.00 percent per year
through 2035, and 2.50 percent per year thereafter, to 1.00 percent per year for all years.
• The assumed investment return was changed from 7.90 percent to 7.50 percent. The single
discount rate changed from 7.90 percent to 7.50 percent.
• Other assumptions were changed pursuant to the experience study June 30, 2015. The assumed
future salary increases, payroll growth, and inflation were decreased by 0.25 percent to
3.25 percent for payroll growth, and 2.50 percent for inflation
2015 CHANGES IN ACTUARIAL ASSUMPTIONS
• The assumed post-retirement benefit increase rate was changed from 1.00 percent per year
through 2030, and 2.50 percent per year thereafter, to 1.00 percent per year through 2035, and
2.50 percent per year thereafter.
2015 CHANGES IN PLAN PROVISIONS
• On January 1, 2015, the Minneapolis Employees Retirement Fund was merged into the General
Employees Fund, which increased the total pension liability by $1.1 billion and increased the
fiduciary plan net position by $892.0 million. Upon consolidation, state and employer
contributions were revised; the state’s contribution of $6.0 million, which meets the special
funding situation definition, was due September 2015.
City of New Hope, Minnesota
Notes to Required Supplementary Information (continued)
December 31, 2020
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PERA – PUBLIC EMPLOYEES POLICE AND FIRE FUND
2020 CHANGES IN ACTUARIAL ASSUMPTIONS
• The mortality projection scale was changed from MP-2018 to MP-2019.
2019 CHANGES IN ACTUARIAL ASSUMPTIONS
• The mortality projection scale was changed from MP-2017 to MP-2018.
2018 CHANGES IN ACTUARIAL ASSUMPTIONS
• The mortality projection scale was changed from MP-2016 to MP-2017.
2018 CHANGES IN PLAN PROVISIONS
• Post-retirement benefit increases were changed to 1.00 percent for all years, with no trigger.
• An end date of July 1, 2048 was added to the existing $9.0 million state contribution.
• New annual state aid will equal $4.5 million in fiscal years 2019 and 2020, and $9.0 million
thereafter, until the plan reaches 100.0 percent funding, or July 1, 2048, if earlier.
• Member contributions were changed from 10.80 percent to 11.30 percent of pay, effective
January 1, 2019, and 11.80 percent of pay, effective January 1, 2020.
• Employer contributions were changed from 16.20 percent to 16.95 percent of pay, effective
January 1, 2019, and 17.70 percent of pay, effective January 1, 2020.
• Interest credited on member contributions decreased from 4.00 percent to 3.00 percent,
beginning July 1, 2018.
• Deferred augmentation was changed to zero percent, effective January 1, 2019. Augmentation
that has already accrued for deferred members will still apply.
• Actuarial equivalent factors were updated to reflect revised mortality and interest assumptions.
City of New Hope, Minnesota
Notes to Required Supplementary Information (continued)
December 31, 2020
-75-
PERA – PUBLIC EMPLOYEES POLICE AND FIRE FUND (CONTINUED)
2017 CHANGES IN ACTUARIAL ASSUMPTIONS
• Assumed salary increases were changed as recommended in the June 30, 2016 experience
study. The net effect is proposed rates that average 0.34 percent lower than the previous rates.
• Assumed rates of retirement were changed, resulting in fewer retirements.
• The CSA load was 30.00 percent for vested and nonvested deferred members. The CSA has
been changed to 33.00 percent for vested members, and 2.00 percent for nonvested members.
• The base mortality table for healthy annuitants was changed from the RP-2000 Fully
Generational Table to the RP-2014 Fully Generational Table (with a base year of 2006), with
male rates adjusted by a factor of 0.96. The mortality improvement scale was changed from
Scale AA to Scale MP-2016. The base mortality table for disabled annuitants was changed
from the RP-2000 Disabled Mortality Table to the mortality tables assumed for healthy retirees.
• Assumed termination rates were decreased to 3.00 percent for the first three years of service.
Rates beyond the select period of three years were adjusted, resulting in more expected
terminations overall.
• Assumed percentage of married female members was decreased from 65.00 percent to
60.00 percent.
• Assumed age difference was changed from separate assumptions for male members (wives
assumed to be three years younger) and female members (husbands assumed to be four years
older) to the assumption that males are two years older than females.
• The assumed percentage of female members electing joint and survivor annuities was
increased.
• The assumed post-retirement benefit increase rate was changed from 1.00 percent for all years,
to 1.00 percent per year through 2064, and 2.50 percent thereafter.
• The single discount rate was changed from 5.60 percent per annum to 7.50 percent per annum.
City of New Hope, Minnesota
Notes to Required Supplementary Information (continued)
December 31, 2020
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PERA – PUBLIC EMPLOYEES POLICE AND FIRE FUND (CONTINUED)
2016 CHANGES IN ACTUARIAL ASSUMPTIONS
• The assumed post-retirement benefit increase rate was changed from 1.00 percent per year
through 2037, and 2.50 percent per year thereafter, to 1.00 percent per year for all future years.
• The assumed investment return was changed from 7.90 percent to 7.50 percent.
• The single discount rate changed from 7.90 percent to 5.60 percent.
• The assumed future salary increases, payroll growth, and inflation were decreased by
0.25 percent to 3.25 percent for payroll growth, and 2.50 percent for inflation.
2015 CHANGES IN ACTUARIAL ASSUMPTIONS
• The assumed post-retirement benefit increase rate was changed from 1.00 percent per year
through 2030, and 2.50 percent per year thereafter, to 1.00 percent per year through 2037, and
2.50 percent per year thereafter.
2015 CHANGES IN PLAN PROVISIONS
• The post-retirement benefit increase to be paid after attainment of the 90.00 percent funding
threshold was changed from inflation up to 2.50 percent, to a fixed rate of 2.50 percent.
OTHER POST-EMPLOYMENT BENEFITS PLAN
2020 CHANGES IN ACTUARIAL ASSUMPTIONS
• The discount rate was changed from 2.74 percent to 2.12 percent.
• The payroll growth rate was changed from 3.50 percent to 3.25 percent.
2019 CHANGES IN ACTUARIAL ASSUMPTIONS
• The discount rate was changed from 4.09 percent to 2.74 percent.
2018 CHANGES IN ACTUARIAL ASSUMPTIONS
• The discount rate was changed from 3.44 percent to 4.09 percent.
SUPPLEMENTAL INFORMATION
CITY OF NEW HOPE, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2020
City of New Hope, Minnesota
Nonmajor Governmental Funds
Combining Balance Sheet
December 31, 2020
Total
Nonmajor
Special Capital Debt Governmental
Revenue Projects Service Funds
Assets
Cash and temporary investments 408,332$ 5,098,617$ 2,846,580$ 8,353,529$
Receivables
Accounts 23,589 - - 23,589
Loans 21,016 - - 21,016
Special assessments 7,257 53,621 - 60,878
Due from other funds - 75,000 - 75,000
Advances to other funds - 375,000 - 375,000
Total Assets 460,194$ 5,602,238$ 2,846,580$ 8,909,012$
Liabilities
Accounts and contracts payable 184$ 9,474$ 903$ 10,561$
Unearned revenue - 13,800 - 13,800
Total Liabilities 184 23,274 903 24,361
Deferred Inflows of Resources
Unavailable revenue - special assessments - 53,621 - 53,621
Fund Balances (Deficit)
Restricted for
Debt service - - 2,845,806 2,845,806
Public safety police expenditures 135,571 - - 135,571
Ice arena 5,505 - - 5,505
Committed for
Solid waste operations 221,667 - - 221,667
Economic development 97,267 - - 97,267
Assigned for
General improvements - 3,249,809 - 3,249,809
Capital equipment - 823,809 - 823,809
Park improvements - 1,451,725 - 1,451,725
Unassigned - -(129) (129)
Total Fund Balances 460,010 5,525,343 2,845,677 8,831,030
Total Liabilities, Deferred Inflows of
Resources, and Fund Balances 460,194$ 5,602,238$ 2,846,580$ 8,909,012$
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City of New Hope, Minnesota
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended December 31, 2020
Total
Nonmajor
Special Capital Debt Governmental
Revenue Projects Service Funds
Revenues
Taxes
Property taxes -$ 767,290$ 3,750,662$ 4,517,952$
Intergovernmental - 17,876 - 17,876
Charges for services 233,481 49,086 - 282,567
Special assessments - 8,592 - 8,592
Investment earnings 7,961 111,748 15,489 135,198
Total Revenues 241,442 954,592 3,766,151 4,962,185
Expenditures
Current
Public works 231,349 - - 231,349
Capital outlay
Culture and recreation - 382,396 - 382,396
Debt service
Principal - - 1,485,165 1,485,165
Interest - - 1,442,553 1,442,553
Total Expenditures 231,349 382,396 2,927,718 3,541,463
Excess of Revenues
Over Expenditures 10,093 572,196 838,433 1,420,722
Other Financing Sources (Uses)
Transfers in - 79,373 - 79,373
Transfers out - (451,800) (68,785) (520,585)
Total Other Financing
Sources (Uses)- (372,427) (68,785) (441,212)
Net Change in Fund Balances 10,093 199,769 769,648 979,510
Fund Balances, January 1 449,917 5,325,574 2,076,029 7,851,520
Fund Balances, December 31 460,010$ 5,525,343$ 2,845,677$ 8,831,030$
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THIS PAGE INTENTIONALLY LEFT BLANK
NONMAJOR SPECIAL REVENUE FUNDS
Police Forfeitures Fund – This fund accounts for revenue received mainly from police fines and
forfeitures, and is used for special police, fire, and parks/recreation projects.
Solid Waste Management Fund – This fund accounts for grants and fees to be used to cover the cost of
operations of the City’s solid waste management program.
Ice Arena Endowment Fund – This fund is used to account for contributions and other receipts to be used
for future capital needs and budget requirements of the New Hope Ice Arena.
CEE Revolving Loan Fund – This fund is used account for Center for Energy and Environment revolving
loans.
City of New Hope, Minnesota
Nonmajor Special Revenue Funds
Subcombining Balance Sheet
December 31, 2020
9021 9016 9017 9018
Police Solid Waste Ice Arena CEE Revolving
Forfeitures Management Endowment Loan Fund Total
Assets
Cash and temporary investments 135,571$ 191,258$ 5,505$ 75,998$ 408,332$
Receivables
Accounts - 23,336 - 253 23,589
Loans - -- 21,016 21,016
Special assessments - 7,257 - - 7,257
Total Assets 135,571$ 221,851$ 5,505$ 97,267$ 460,194$
Liabilities
Accounts and contracts payable -$ 184$ -$ -$ 184$
Fund Balances
Restricted for
Public safety police expenditures 135,571 - - - 135,571
Ice arena - - 5,505 - 5,505
Committed for
Solid waste operations - 221,667 - - 221,667
Economic development - -- 97,267 97,267
Total Fund Balances 135,571 221,667 5,505 97,267 460,010
Total Liabilities and
Fund Balances 135,571$ 221,851$ 5,505$ 97,267$ 460,194$
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City of New Hope, Minnesota
Nonmajor Special Revenue Funds
Subcombining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended December 31, 2020
9021 9016 9017 9018
Police Solid Waste Ice Arena CEE Revolving
Forfeitures Management Endowment Loan Fund Total
Revenues
Charges for services -$ 233,481$ -$ -$ 233,481$
Investment earnings 2,841 4,151 115 854 7,961
Total Revenues 2,841 237,632 115 854 241,442
Expenditures
Current
Public works
Other services and charges - 231,349 - - 231,349
Net Change in Fund Balances 2,841 6,283 115 854 10,093
Fund Balances, January 1 132,730 215,384 5,390 96,413 449,917
Fund Balances, December 31 135,571$ 221,667$ 5,505$ 97,267$ 460,010$
-80-
City of New Hope, Minnesota
Special Revenue Fund - Solid Waste Management Fund
Schedule of Revenues, Expenditures, and Changes in Fund Balances –
Budget and Actual
For the Year Ended December 31, 2020
Actual Over (Under)
Original Final Amounts Budget
Revenues
Charges for services 227,000$ 227,000$ 233,481$ 6,481$
Investment earnings 1,500 1,500 4,151 2,651
Total Revenues 228,500 228,500 237,632 9,132
Expenditures
Current
Public works
Other services and charges 225,235 225,235 231,349 6,114
Net Change in Fund Balances 3,265 3,265 6,283 3,018
Fund Balances, January 1 215,384 215,384 215,384 -
Fund Balances, December 31 218,649$ 218,649$ 221,667$ 3,018$
Budgeted Amounts
-81-
NONMAJOR CAPITAL PROJECT FUNDS
Capital Projects Funds account for proceeds from the sale of bonds and other revenue to be used for the
purchase or construction of equipment and capital improvement facilities.
Fire Capital Projects Fund – This fund accounts for the purchases of fire capital equipment.
Park Infrastructure Fund – This fund is used to account for park improvement projects.
Temporary Financing Fund – is used to account for various capital project and capital outlay purchases
until permanent financing is acquired.
2016 Street Improvement Project Fund – This fund is used to account for the 2016 street improvement
project.
City of New Hope, Minnesota
Nonmajor Capital Projects Funds
Subcombining Balance Sheet
December 31, 2020
9010 9233 9242 9250
2016 Street
Fire Park Temporary Improvement
Capital Projects Infrastructure Financing Project Total
Assets
Cash and temporary investments 823,809$ 1,474,999$ 2,799,809$ -$ 5,098,617$
Receivables
Special assessments - - 53,621 - 53,621
Due from other funds - - 75,000 - 75,000
Advances to other funds - - 375,000 - 375,000
Total Assets 823,809$ 1,474,999$ 3,303,430$ -$ 5,602,238$
Liabilities
Accounts and contracts payable -$ 9,474$ -$ -$ 9,474$
Unearned revenue - 13,800 - - 13,800
Total Liabilities - 23,274 - - 23,274
Deferred Inflows of Resources
Unavailable revenue - special assessments - - 53,621 - 53,621
Fund Balances
Assigned for
General improvements - - 3,249,809 - 3,249,809
Capital equipment 823,809 - - - 823,809
Park improvements - 1,451,725 - - 1,451,725
Total Fund Balances 823,809 1,451,725 3,249,809 - 5,525,343
Total Liabilities, Deferred
Inflows of Resources,
and Fund Balances 823,809$ 1,474,999$ 3,303,430$ -$ 5,602,238$
-82-
City of New Hope, Minnesota
Nonmajor Capital Projects Funds
Subcombining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended December 31, 2020
9010 9233 9242 9250
2016 Street
Fire Park Temporary Improvement
Capital Projects Infrastructure Financing Project Total
Revenues
Taxes
Property taxes -$ 767,290$ -$ -$ 767,290$
Intergovernmental
County - 17,876 - - 17,876
Charges for services - 49,086 - - 49,086
Special assessments - - 8,592 - 8,592
Investment earnings 16,606 31,691 63,451 - 111,748
Total Revenues 16,606 865,943 72,043 - 954,592
Expenditures
Capital outlay
Culture and recreation - 382,396 - - 382,396
Excess of Revenues
Over Expenditures 16,606 483,547 72,043 - 572,196
Other Financing Sources (Uses)
Transfers in 68,785 - - 10,588 79,373
Transfers out (51,800) (400,000) - - (451,800)
Total Other Financing
Sources (Uses)16,985 (400,000) - 10,588 (372,427)
Net Change in Fund Balances 33,591 83,547 72,043 10,588 199,769
Fund Balances (Deficit), January 1 790,218 1,368,178 3,177,766 (10,588) 5,325,574
Fund Balances, December 31 823,809$ 1,451,725$ 3,249,809$ -$ 5,525,343$
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NONMAJOR DEBT SERVICE FUNDS
The Debt Service Funds are used to account for the payment of principal and interest on the City’s general
obligation bonds. Revenues for this purpose include ad valorem property taxes, special assessments,
investment income, and other revenue.
2015A G.O. Tax Increment Bonds – This fund accounts for revenue from property taxes and interest
income to be used for the payment of principal and interest on the City’s 2015A G.O. Tax Increment Bonds.
2010B G.O. Equipment Bonds Fund – This fund accounts for revenue from property taxes and interest
income to be used for the payment of principal and interest on the City’s 2010B G.O. Equipment Bonds.
2016A G.O. Improvement Bonds – This fund accounts for revenue from property taxes and interest
income to be used for the payment of principal and interest on the City’s 2016A G.O. Improvement Bonds.
2015B G.O. Improvement Bonds – This fund accounts for revenue from property taxes and interest
income to be used for the payment of principal and interest on the City’s 2015B G.O. Improvement Bonds.
2017A G.O. Improvement Bonds – This fund accounts for revenue from property taxes and interest
income to be used for the payment of principal and interest on the City’s 2017A G.O. Improvement Bonds.
2018A G.O. Improvement Bonds – This fund accounts for revenue from property taxes and interest
income to be used for the payment of principal and interest on the City’s 2018A G.O. Improvement Bonds.
2019A G.O. Improvement Bonds – This fund accounts for revenue from property taxes and interest
income to be used for the payment of principal and interest on the City’s 2019A G.O. Improvement Bonds.
City of New Hope, Minnesota
Nonmajor Debt Service Funds
Subcombining Balance Sheet
December 31, 2020
9144 9145 9148 9149
2015A 2010B 2016A 2015B
G.O.G.O.G.O.G.O.
Tax Increment Equipment Improvement Improvement
Bonds Bonds Bonds Bonds
Assets
Cash and temporary investments 277,003$ -$ 274,209$ 164,592$
Liabilities
Accounts and contracts payable 129$ 129$ 129$ 129$
Fund Balances (Deficit)
Restricted for debt service 276,874 - 274,080 164,463
Unassigned - (129) - -
Total Fund Balances (Deficit)276,874 (129) 274,080 164,463
Total Liabilities and
Fund Balances 277,003$ -$ 274,209$ 164,592$
-84-
9150 9151 9152
2017A 2018A 2019A
G.O.G.O.G.O.
Improvement Improvement Improvement
Bonds Bonds Bonds Total
1,468,459$ 284,637$ 377,680$ 2,846,580$
129$ 129$ 129$ 903$
1,468,330 284,508 377,551 2,845,806
- - - (129)
1,468,330 284,508 377,551 2,845,677
1,468,459$ 284,637$ 377,680$ 2,846,580$
-85-
City of New Hope, Minnesota
Nonmajor Debt Service Funds
Subcombining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended December 31, 2020
9144 9145 9148 9149
2015A 2010B 2016A 2015B
G.O.G.O.G.O.G.O.
Tax Increment Equipment Improvement Improvement
Bonds Bonds Bonds Bonds
Revenues
Property taxes 240,162$ -$ 259,142$ 207,663$
Investment earnings 3,594 1,981 2,612 771
Total Revenues 243,756 1,981 261,754 208,434
Expenditures
Debt service
Principal 151,053 150,000 157,054 122,058
Interest and fiscal charges 54,850 2,640 81,495 47,636
Total Expenditures 205,903 152,640 238,549 169,694
Excess (Deficiency) of
Revenue Over Expenditures 37,853 (150,659) 23,205 38,740
Other Financing Sources (Uses)
Transfers out - (68,785) - -
Net Change in Fund Balances 37,853 (219,444) 23,205 38,740
Fund Balances (Deficit), January 1 239,021 219,315 250,875 125,723
Fund Balances (deficit), December 31 276,874$ (129)$ 274,080$ 164,463$
-86-
9150 9151 9152
2017A 2018A 2019A
G.O.G.O.G.O.
Improvement Improvement Improvement
Bonds Bonds Bonds Total
1,709,190$ 865,627$ 468,878$ 3,750,662$
5,830 88 613 15,489
1,715,020 865,715 469,491 3,766,151
905,000 - - 1,485,165
706,090 360,571 189,271 1,442,553
1,611,090 360,571 189,271 2,927,718
103,930 505,144 280,220 838,433
- - - (68,785)
103,930 505,144 280,220 769,648
1,364,400 (220,636) 97,331 2,076,029
1,468,330$ 284,508$ 377,551$ 2,845,677$
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City of New Hope, Minnesota
General Fund
Schedule of Revenues, Expenditures and
Changes in Fund Balances - Budget and Actual (Continued on the Following Pages)
For the Year Ended December 31, 2020
(With Comparative Actual Amounts for the Year Ended December 31, 2019)
2019
Actual Over (Under)Actual
Original Final Amounts Budget Amounts
Revenues
Taxes
Property taxes 10,518,931$ 10,518,931$ 10,422,823$ (96,108)$ 10,297,018$
Franchise taxes 505,244 505,244 518,162 12,918 533,213
Total Taxes 11,024,175 11,024,175 10,940,985 (83,190) 10,830,231
Licenses and permits
Business regulatory licenses 75,575 75,575 64,760 (10,815) 70,783
Non-business licenses and permits 398,450 398,450 329,151 (69,299) 249,655
Total Licenses and permits 474,025 474,025 393,911 (80,114) 320,438
Intergovernmental
Local government aid 807,579 807,579 815,623 8,044 697,864
Highway maintenance aid 191,000 191,000 231,733 40,733 212,664
Other federal, state, and local grants 121,683 121,683 1,792,954 1,671,271 120,591
State insurance premium tax 285,000 285,000 321,335 36,335 311,424
Total Intergovernmental 1,405,262 1,405,262 3,161,645 1,756,383 1,342,543
Charges for services
General government 186,050 186,050 150,967 (35,083) 152,308
Public safety 398,500 398,500 267,931 (130,569) 403,636
Public works 5,800 5,800 3,596 (2,204) 4,243
Culture and recreation 1,258,950 1,258,950 281,826 (977,124) 504,090
Total Charges for services 1,849,300 1,849,300 704,320 (1,144,980) 1,064,277
Fines and forfeitures 225,000 225,000 138,922 (86,078) 227,343
Special assessments 30,000 30,000 110,670 80,670 50,034
Investment earnings 60,000 60,000 113,447 53,447 106,033
Miscellaneous 3,500 3,500 14,184 10,684 23,326
Total Revenues 15,071,262 15,071,262 15,578,084 506,822 13,964,225
Budgeted Amounts
2020
-88-(continued)
City of New Hope, Minnesota
General Fund
Schedule of Revenues, Expenditures and
Changes in Fund Balances - Budget and Actual (Continued)
For the Year Ended December 31, 2020
(With Comparative Actual Amounts for the Year Ended December 31, 2019)
2019
Actual Variance with Actual
Original Final Amounts Final Budget Amounts
Expenditures
Current
General government
Mayor and City Council
Personnel services 58,153$ 58,153$ 57,043$ (1,110)$ 52,142$
Supplies 2,000 2,000 678 (1,322) 1,439
Other services and charges 42,280 42,280 36,940 (5,340) 34,231
Total Mayor and City Council 102,433 102,433 94,661 (7,772) 87,812
City hall
Supplies 23,500 23,500 20,232 (3,268) 22,644
Other services and charges 310,926 310,926 392,964 82,038 279,395
Total City hall 334,426 334,426 413,196 78,770 302,039
City Manager
Personnel services 401,373 401,373 407,779 6,406 401,782
Supplies 6,100 6,100 1,233 (4,867) 5,340
Other services and charges 24,573 24,573 22,602 (1,971) 14,080
Total City Manager 432,046 432,046 431,614 (432) 421,202
Elections
Personnel services 55,779 55,779 42,105 (13,674) -
Supplies 2,500 2,500 6,738 4,238 -
Other services and charges 5,850 5,850 6,873 1,023 4,185
Total Elections 64,129 64,129 55,716 (8,413) 4,185
Finance
Personnel services 189,742 189,742 190,816 1,074 171,471
Supplies 1,350 1,350 1,852 502 1,328
Other services and charges 75,791 75,791 93,648 17,857 134,364
Total Finance 266,883 266,883 286,316 19,433 307,163
Auditing
Other services and charges 26,276 26,276 24,771 (1,505) 24,441
Assessing
Other services and charges 160,000 160,000 160,000 - 154,000
Legal
Other services and charges 25,000 25,000 29,429 4,429 16,097
Human resources
Personnel services 267,654 267,654 274,087 6,433 263,755
Supplies 450 450 228 (222) 451
Other services and charges 40,982 40,982 25,512 (15,470) 23,020
Total Human resources 309,086 309,086 299,827 (9,259) 287,226
Budgeted Amounts
2020
-89-(continued)
City of New Hope, Minnesota
General Fund
Schedule of Revenues, Expenditures and
Changes in Fund Balances - Budget and Actual (Continued)
For the Year Ended December 31, 2020
(With Comparative Actual Amounts for the Year Ended December 31, 2019)
2019
Actual Variance with Actual
Original Final Amounts Final Budget Amounts
Budgeted Amounts
2020
Expenditures (Continued)
Current (continued)
General government (continued)
Planning and zoning
Personnel services 106,317$ 106,317$ 118,603$ 12,286$ 112,208$
Supplies 700 700 478 (222) 285
Other services and charges 37,900 37,900 33,942 (3,958) 35,825
Total Planning and zoning 144,917 144,917 153,023 8,106 148,318
Communication
Personnel services 111,474 111,474 89,320 (22,154) 99,606
Supplies 6,140 6,140 4,673 (1,467) 5,463
Other services and charges 52,140 52,140 20,187 (31,953) 42,928
Total Communication 169,754 169,754 114,180 (55,574) 147,997
Total General Government 2,034,950 2,034,950 2,062,733 27,783 1,900,480
Public safety
Police
Personnel services 5,477,174 5,477,174 4,997,575 (479,599) 5,078,553
Supplies 80,030 80,030 134,467 54,437 138,034
Other services and charges 1,155,034 1,155,034 1,091,335 (63,699) 1,169,754
Total Police 6,712,238 6,712,238 6,223,377 (488,861) 6,386,341
Police reserves
Personnel services - - - - 266
Supplies 2,100 2,100 1,221 (879) 1,903
Other services and charges 23,626 23,626 22,267 (1,359) 30,179
Total Police reserves 25,726 25,726 23,488 (2,238) 32,348
Fire and safety
Supplies 1,000 1,000 - (1,000) 41
Other services and charges 1,330,503 1,330,503 1,414,715 84,212 1,244,756
Total Fire and safety 1,331,503 1,331,503 1,414,715 83,212 1,244,797
Animal control
Personnel services 84,934 84,934 84,846 (88) 81,838
Supplies 505 505 99 (406) 204
Other services and charges 22,866 22,866 18,887 (3,979) 24,830
Total Animal control 108,305 108,305 103,832 (4,473) 106,872
-90-(continued)
City of New Hope, Minnesota
General Fund
Schedule of Revenues, Expenditures and
Changes in Fund Balances - Budget and Actual (Continued)
For the Year Ended December 31, 2020
(With Comparative Actual Amounts for the Year Ended December 31, 2019)
2019
Actual Variance with Actual
Original Final Amounts Final Budget Amounts
Budgeted Amounts
2020
Expenditures (Continued)
Current (continued)
Public safety (continued)
Protective inspection
Personnel services 524,732$ 524,732$ 506,212$ (18,520)$ 490,391$
Supplies 1,750 1,750 1,615 (135) 1,024
Other services and charges 100,045 100,045 87,970 (12,075) 165,714
Total Protective inspection 626,527 626,527 595,797 (30,730) 657,129
Total Public Safety 8,804,299 8,804,299 8,361,209 (443,090) 8,427,487
Public works
Street maintenance
Personnel services 573,229 573,229 605,084 31,855 607,772
Supplies 142,100 142,100 116,228 (25,872) 90,691
Other services and charges 869,839 869,839 859,892 (9,947) 812,459
Total Street maintenance 1,585,168 1,585,168 1,581,204 (3,964) 1,510,922
Engineering
Other services and charges 35,000 35,000 40,842 5,842 53,226
Total Public Works 1,620,168 1,620,168 1,622,046 1,878 1,564,148
Culture and recreation
Recreation
Personnel services 677,224 677,224 611,920 (65,304) 646,135
Supplies 122,000 122,000 90,638 (31,362) 109,784
Other services and charges 219,321 219,321 156,342 (62,979) 253,962
Total Recreation 1,018,545 1,018,545 858,900 (159,645) 1,009,881
Parks
Personnel services 653,391 653,391 595,900 (57,491) 582,433
Supplies 37,650 37,650 33,625 (4,025) 35,450
Other services and charges 429,841 429,841 401,333 (28,508) 353,689
Total Parks 1,120,882 1,120,882 1,030,858 (90,024) 971,572
Swimming pool
Personnel services 494,688 494,688 115,135 (379,553) 45,933
Supplies 73,000 73,000 14,886 (58,114) -
Other services and charges 175,518 175,518 15,879 (159,639) 5,199
Total Swimming pool 743,206 743,206 145,900 (597,306) 51,132
Total Culture and Recreation 2,882,633 2,882,633 2,035,658 (846,975) 2,032,585
Total Current Expenditures 15,342,050 15,342,050 14,081,646 (1,260,404) 13,924,700
-91-(continued)
City of New Hope, Minnesota
General Fund
Schedule of Revenues, Expenditures and
Changes in Fund Balances - Budget and Actual (Continued)
For the Year Ended December 31, 2020
(With Comparative Actual Amounts for the Year Ended December 31, 2019)
2019
Actual Variance with Actual
Original Final Amounts Final Budget Amounts
Budgeted Amounts
2020
Expenditures (Continued)
Capital outlay
General government 3,500$ 3,500$ 674$ (2,826)$ 3,967$
Public safety 65,000 65,000 48,669 (16,331) 55,081
Total Capital outlay 68,500 68,500 49,343 (19,157) 59,048
Total Expenditures 15,410,550 15,410,550 14,130,989 (1,279,561) 13,983,748
Excess (Deficiency) of
Revenues Over Expenditures (339,288) (339,288) 1,447,095 1,786,383 (19,523)
Other Financing Sources (Uses)
Transfers in 339,288 339,288 339,288 - 332,275
Transfers out - - - - (354,000)
Total Other Financing
Sources (Uses)339,288 339,288 339,288 - (21,725)
Net Change in Fund Balances - - 1,786,383 1,786,383 (41,248)
Fund Balances, January 1 7,139,703 7,139,703 7,139,703 - 7,180,951
Fund Balances, December 31 7,139,703$ 7,139,703$ 8,926,086$ 1,786,383$ 7,139,703$
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INTERNAL SERVICE FUNDS
Internal Service Funds are used to account for activities and services performed for other organizational
units within the City. Charges to other city agencies are made to support these activities.
Central Garage Fund – This fund is used to account for the rental of motor vehicles and other equipment
to other departments.
Employee Leave Fund – This fund accounts for the cost of providing leave time benefits to employees,
which includes vacation, holiday, sick time, and personal leave. Funding is based on chargebacks to
department, based on a percentage of wages.
Insurance Reserve Fund – This fund accounts for all insurance costs for the City. Funding is provided by
chargebacks to departments by percentage of wages for health, dental, life, and disability insurance.
Funding for general liability and property insurance is provided by chargebacks to departments based on
activities and the use of property.
Information Technology Fund – This fund accounts for the City’s investment in, and operations of,
computer networks, application and system software, internet access, data storage, and related activities.
City of New Hope, Minnesota
Internal Service Funds
Combining Statement of Net Position
December 31, 2020
9402 9408 9407 9410
Central Employee Insurance Information
Garage Leave Reserve Technology Totals
Assets
Current Assets
Cash and temporary investments 8,282,096$ 1,673,358$ 625,840$ 583,540$ 11,164,834$
Receivables
Accounts - - 7,441 - 7,441
Inventories 68,035 - - - 68,035
Total Current Assets 8,350,131 1,673,358 633,281 583,540 11,240,310
Noncurrent Assets
Capital assets
Land 85,647 - - - 85,647
Buildings and structures 3,158,296 - - - 3,158,296
Vehicles and equipment 9,361,117 - - 402,419 9,763,536
Less: accumulated depreciation (9,843,971) - - (320,304) (10,164,275)
Total Capital Assets
(Net of Accumulated Depreciation)2,761,089 - - 82,115 2,843,204
Total Assets 11,111,220 1,673,358 633,281 665,655 14,083,514
Deferred Outflows of Resources
Deferred pension resources 23,772 - - - 23,772
Deferred other postemployment benefit resources - - 167,973 - 167,973
Total Deferred Outflows of Resources 23,772 - 167,973 - 191,745
Liabilities
Current Liabilities
Accrued salaries payable 11,474 33,745 117,649 - 162,868
Accounts and contracts payable 59,629 - 58,314 8,995 126,938
Due to other governments 631 - - - 631
Compensated absences payable, current portion - 84,346 - - 84,346
Total Current Liabilities 71,734 118,091 175,963 8,995 374,783
Noncurrent Liabilities
Other postemployment benefits payable - - 1,110,463 - 1,110,463
Pension liability 221,812 - - - 221,812
Compensated absences payable - 759,110 - - 759,110
Total Noncurrent Liabilities 221,812 759,110 1,110,463 - 2,091,385
Total Liabilities 293,546 877,201 1,286,426 8,995 2,466,168
Deferred Inflows of Resources
Deferred pension resources 8,898 - - - 8,898
Deferred other postemployment benefit resources - - 33,203 - 33,203
Total Deferred Inflows of Resources 8,898 - 33,203 - 42,101
Net Position
Net investment in capital assets 2,761,089 - - 82,115 2,843,204
Unrestricted 8,071,459 796,157 (518,375) 574,545 8,923,786
Total Net Position 10,832,548$ 796,157$ (518,375)$ 656,660$ 11,766,990$
-93-
City of New Hope, Minnesota
Internal Service Funds
Combining Statement of Revenues, Expenses and
Changes in Net Position
For the Year Ended December 31, 2020
9402 9408 9407 9410
Central Employee Insurance Information
Garage Leave Reserve Technology Totals
Operating Revenues
Billings to departments 2,151,996$ 699,992$ 20,014$ 827,236$ 3,699,238$
Other 995 - 22,531 - 23,526
Total Operating Revenues 2,152,991 699,992 42,545 827,236 3,722,764
Operating Expenses
Personnel services 327,964 576,845 125,689 - 1,030,498
Supplies 234,580 - - 49,594 284,174
Utilities 57,245 - - 49,098 106,343
Other services and charges 423,963 - 34,134 609,027 1,067,124
Depreciation 564,728 - - 12,843 577,571
Total Operating Expenses 1,608,480 576,845 159,823 720,562 3,065,710
Operating Income (Loss)544,511 123,147 (117,278) 106,674 657,054
Nonoperating Revenues (Expenses)
Investment earnings 163,258 - - 10,556 173,814
Capital contributions to governmental activities - - - (22,997) (22,997)
Gain on sale of capital assets 22,000 - - - 22,000
Total Nonoperating Revenues (Expenses)185,258 - - (12,441) 172,817
Income (Loss) Before Transfers 729,769 123,147 (117,278) 94,233 829,871
Transfers Out (35,619) - - (56,989) (92,608)
Change in Net Position 694,150 123,147 (117,278) 37,244 737,263
Net Position, January 1 10,138,398 673,010 (401,097) 619,416 11,029,727
Net Position, December 31 10,832,548$ 796,157$ (518,375)$ 656,660$ 11,766,990$
-94-
City of New Hope, Minnesota
Internal Service Funds
Combining Statement of Cash Flows
For the Year Ended December 31, 2020
9402 9408 9407 9410
Central Employee Insurance Information
Garage Leave Reserve Technology Totals
Cash Flows from Operating Activities
Receipts from interfund services provided 2,151,996$ 699,992$ 17,048$ 827,236$ 3,696,272$
Other operating receipts 995 - 22,531 - 23,526
Payments to suppliers (701,652) - (32,604) (737,521) (1,471,777)
Payments to employees (319,736) (496,499) 24,204 - (792,031)
Net Cash From
Operating Activities 1,131,603 203,493 31,179 89,715 1,455,990
Cash Flows from Noncapital
Financing Activities
Transfers out (35,619) - - (56,989) (92,608)
Cash Flows from Capital
and Related Financing Activities
Acquisition capital assets (516,589) - - (9,399) (525,988)
Proceeds from sale of assets 22,000 - - - 22,000
Net Cash From Capital
and Related Financing Activities (494,589) - - (9,399) (503,988)
Investment earnings 163,258 - - 10,556 173,814
Net Increase in Cash
and Cash Equivalents 764,653 203,493 31,179 33,883 1,033,208
Cash and Cash Equivalents, January 1 7,517,443 1,469,865 594,661 549,657 10,131,626
Cash and Cash Equivalents, December 31 8,282,096$ 1,673,358$ 625,840$ 583,540$ 11,164,834$
Reconciliation of Operating Income (Loss)
to Net Cash From Operating Activities
Operating income (loss)544,511$ 123,147$ (117,278)$ 106,674$ 657,054$
Adjustments to reconcile operating income (loss)
to net cash from operating activities
Depreciation 564,728 - - 12,843 577,571
(Increase) decrease in assets
Accounts receivable - - (2,966) - (2,966)
Inventories (5,460) - - - (5,460)
(Increase) decrease in deferred outflows of resources
Deferred pension resources (4,643) - - - (4,643)
Deferred other postemployment benefit resources - - (48,960) - (48,960)
Increase (decrease) in liabilities
Accounts and contracts payable 19,545 - 1,530 (29,802) (8,727)
Accrued salaries payable 3,368 (9,229) 24,204 - 18,343
Due to other governments 51 - - - 51
Compensated absences payable - 89,575 - - 89,575
Other postemployment benefits payable - - 177,615 - 177,615
Pension liability 35,592 - - - 35,592
Increase (decrease) in deferred inflows of resources
Deferred pension resources (26,089) - - - (26,089)
Deferred other postemployment benefit resources - - (2,966) - (2,966)
Net Cash From
Operating Activities 1,131,603$ 203,493$ 31,179$ 89,715$ 1,455,990$
Schedule of Noncash Capital and
Related Financing Activities
Capital assets contributed to governmental activities -$ -$ -$ 22,997$ 22,997$
Cash Flows from Investing Activities
-95-
STATISTICAL SECTION (UNAUDITED)
CITY OF NEW HOPE, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2020
STATISTICAL SECTION (UNAUDITED)
This part of the City’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’s overall financial health.
Financial Trends
These schedules contain trend information to help the reader understand how the City ’s financial
performance and well-being have changed over time.
Revenue Capacity
These schedules contain information to help the reader assess the City’s most significant local revenue
source; property taxes.
Debt Capacity
These schedules present information to help the reader assess the affordability of the City’s current levels
of outstanding debt and the City’s ability to issue additional debt in the future.
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the environment
within which the City’s financial activities take place.
Operating Indicators
These schedules contain service and infrastructure data to help the reader understand how the information
in the City’s financial report relates to the services the City provides and the activities it performs.
Source: Unless otherwise noted, the information in these schedules is derived from the Comprehensive
Annual Financial Report for the relevant year.
2011 (Restated)2012 2013 2014
Governmental activities
Net investment in capital assets 20,628,143$ 26,793,142$ 30,509,373$ 26,305,906$
Restricted 6,018,734 1,619,696 1,619,394 5,680,117
Unrestricted 21,845,278 22,746,207 23,704,592 23,130,558
Total governmental activities net position 48,492,155$ 51,159,045$ 55,833,359$ 55,116,581$
Business-type activities
Net investment in capital assets 11,114,666$ 12,843,624$ 14,142,276$ 14,757,333$
Restricted – 150,000 300,000 455,000
Unrestricted 3,978,803 2,735,144 2,496,008 1,798,707
Total business-type activities net position 15,093,469$ 15,728,768$ 16,938,284$ 17,011,040$
Primary government
Net investment in capital assets 31,742,809$ 39,636,766$ 44,651,649$ 41,063,239$
Restricted 6,018,734 1,769,696 1,919,394 6,135,117
Unrestricted 25,824,081 25,481,351 26,200,600 24,929,265
Total primary government net position 63,585,624$ 66,887,813$ 72,771,643$ 72,127,621$
Note 1:
Note 2:
Note 3:
City of New Hope, Minnesota
The City implemented GASB Statement No.65 in 2012.Net position for 2011 was restated for the effect of
implementing this standard.
The City implemented GASB Statement No.68 in 2015,resulting in a restatement of beginning net position for
the effects of implementing this standard. Net position for previous years has not been restated.
The City implemented GASB Statement No.75 in 2018,resulting in a restatement of beginning net position for
the effects of implementing this standard. Net position for previous years has not been restated.
Fiscal Year
Net Position by Component
Last Ten Fiscal Years
(Accrual Basis of Accounting)
-96-
2015 2016 2017 2018 2019 2020
27,549,276$ 29,951,754$ 27,747,845$ 27,888,417$ 30,139,510$ 31,359,813$
5,917,848 4,893,801 6,207,578 6,000,843 6,628,138 7,740,859
14,623,043 11,081,824 11,728,807 14,384,257 16,702,142 19,716,696
48,090,167$ 45,927,379$ 45,684,230$ 48,273,517$ 53,469,790$ 58,817,368$
16,087,559$ 19,286,134$ 18,663,872$ 18,783,898$ 19,315,353$ 20,127,288$
627,939 868,853 1,031,673 1,160,680 1,358,401 1,560,053
(825,297) (1,839,376) 84,741 1,783,306 3,054,187 4,534,420
15,890,201$ 18,315,611$ 19,780,286$ 21,727,884$ 23,727,941$ 26,221,761$
43,636,835$ 49,237,888$ 46,411,717$ 46,672,315$ 49,454,863$ 51,487,101$
6,545,787 5,762,654 7,239,251 7,161,523 7,986,539 9,300,912
13,797,746 9,242,448 11,813,548 16,167,563 19,756,329 24,251,116
63,980,368$ 64,242,990$ 65,464,516$ 70,001,401$ 77,197,731$ 85,039,129$
-97-
2011 2012 2013 2014
Expenses
Governmental activities
General government 1,841,145$ 1,931,318$ 1,837,194$ 1,976,377$
Public safety 6,129,860 6,062,362 6,238,779 6,795,836
Public works 1,795,189 2,126,043 1,790,669 2,467,618
Culture and recreation 1,882,279 1,928,591 1,946,243 2,145,224
Economic development 536,433 762,202 431,332 1,704,010
Interest and fiscal charges 236,827 407,744 289,009 140,321
Total governmental activities expenses 12,421,733 13,218,260 12,533,226 15,229,386
Business-type activities
Sewer 2,068,282 2,220,438 2,310,604 1,976,864
Water 3,530,521 3,682,602 3,215,714 4,635,686
Golf course 322,679 298,555 262,894 304,059
Ice arena 844,828 771,628 957,784 877,826
Storm water 485,943 425,112 768,610 558,160
Street lighting 113,753 104,721 117,518 99,560
Total business-type activities expenses 7,366,006 7,503,056 7,633,124 8,452,155
Total primary government expenses 19,787,739$ 20,721,316$ 20,166,350$ 23,681,541$
Program revenues
Governmental activities
Charges for services
General government 220,629$ 177,174$ 198,297$ 234,440$
Public safety 877,159 804,725 880,843 1,047,721
Public works 219,353 219,548 226,228 224,790
Culture and recreation 637,077 653,293 672,067 617,459
Economic development 98,139 94,664 – –
Operating grants and contributions 783,382 2,162,263 828,276 1,013,058
Capital grants and contributions 1,107,042 245,290 3,929,565 47,917
Total governmental activities program
revenues 3,942,781 4,356,957 6,735,276 3,185,385
Business-type activities
Charges for services
Sewer utility 2,352,635 2,376,021 2,443,202 2,414,482
Water utility 3,169,859 3,581,225 3,460,008 3,634,873
Golf course 278,788 296,316 268,133 254,508
Ice arena 752,671 694,702 725,211 775,784
Storm water 947,031 948,650 963,167 948,537
Street lighting 122,742 124,397 125,604 123,060
Operating grants and contributions 24,031 22,340 306,520 444,484
Capital grants and contributions 114,826 106,291 225,300 11,469
Total business-type activities program
revenues 7,762,583 8,149,942 8,517,145 8,607,197
Total primary government program revenues 11,705,364$ 12,506,899$ 15,252,421$ 11,792,582$
Fiscal Year
City of New Hope, Minnesota
Changes in Net Position
Last Ten Fiscal Years
(Accrual Basis of Accounting)
-98-
2015 2016 2017 2018 2019 2020
1,700,133$ 1,871,736$ 2,666,781$ 1,983,179$ 1,850,242$ 2,945,625$
7,258,504 9,463,124 8,257,709 7,578,150 8,540,198 8,968,009
4,229,077 3,143,421 2,975,007 3,661,766 3,816,417 3,725,075
2,223,152 2,405,905 2,485,417 2,280,418 2,145,988 2,270,751
655,093 732,106 2,163,967 1,244,292 749,651 1,350,348
269,284 323,326 725,982 1,074,469 1,412,763 1,570,807
16,335,243 17,939,618 19,274,863 17,822,274 18,515,259 20,830,615
2,458,724 2,187,006 2,399,248 2,631,598 2,834,973 3,096,526
4,584,929 3,633,022 3,504,722 4,038,859 3,762,099 4,195,981
291,695 341,776 322,278 299,217 319,871 316,173
880,581 949,438 996,056 987,912 1,003,048 1,016,296
713,218 830,108 834,688 736,166 888,156 877,244
105,452 102,894 101,668 119,250 116,732 133,270
9,034,599 8,044,244 8,158,660 8,813,002 8,924,879 9,635,490
25,369,842$ 25,983,862$ 27,433,523$ 26,635,276$ 27,440,138$ 30,466,105$
254,333$ 267,970$ 340,421$ 250,575$ 223,379$ 217,183$
1,073,079 1,035,725 1,302,551 935,116 880,634 736,004
219,634 220,208 234,564 228,660 226,249 234,121
668,480 699,613 686,335 570,143 529,739 316,820
– 20,000 41,112 – – –
845,517 1,002,681 777,368 967,499 826,489 866,861
460,537 711,527 1,150,840 941,212 2,819,823 1,048,750
3,521,580 3,957,724 4,533,191 3,893,205 5,506,313 3,419,739
2,468,638 2,627,875 2,899,257 3,154,709 3,380,075 3,712,613
3,777,108 4,124,346 4,289,255 4,696,593 4,675,498 5,468,607
287,056 315,162 283,375 298,696 296,538 423,766
745,886 749,689 849,701 864,531 892,740 601,291
981,723 1,037,429 1,082,348 1,139,007 1,190,058 1,259,707
128,890 137,525 137,491 144,582 152,975 161,866
33,032 159,898 27,568 327,335 14,308 110,331
194,590 1,394,822 58,237 14,203 28,824 12,922
8,616,923 10,546,746 9,627,232 10,639,656 10,631,016 11,751,103
12,138,503$ 14,504,470$ 14,160,423$ 14,532,861$ 16,137,329$ 15,170,842$
-99-(continued)
2011 2012 2013 2014
Net (expense) revenue
Governmental activities (8,478,952)$ (8,861,303)$ (5,797,950)$ (12,044,001)$
Business-type activities 396,577 646,886 884,021 155,042
Total primary government net expense (8,082,375)$ (8,214,417)$ (4,913,929)$ (11,888,959)$
General revenues and other changes in net position
Governmental activities
Property taxes 8,784,948$ 9,129,247$ 9,554,629$ 9,732,776$
Tax increments 1,400,163 1,343,248 511,924 537,871
Franchise taxes 439,795 440,149 438,834 438,541
Grants and contributions not restricted
to specific programs 87,206 47,662 49,005 179,537
Unrestricted investment earnings 745,484 429,595 198,658 324,498
Gain on sale of capital assets 13,568 69,321 37,201 –
Transfers (2,163,781) 68,971 (317,987) 114,000
Total governmental activities 9,307,383 11,528,193 10,472,264 11,327,223
Business-type activities
Unrestricted investment earnings 71,089 57,384 7,508 31,714
Transfers 2,163,781 (68,971) 317,987 (114,000)
Total business-type activities 2,234,870 (11,587) 325,495 (82,286)
Total primary government 11,542,253$ 11,516,606$ 10,797,759$ 11,244,937$
Changes in net position
Governmental activities 828,431$ 2,666,890$ 4,674,314$ (716,778)$
Business-type activities 2,631,447 635,299 1,209,516 72,756
Total primary government 3,459,878$ 3,302,189$ 5,883,830$ (644,022)$
Note:The City implemented GASB Statement No.63 and GASB Statement No.65 in fiscal 2012.Net position information has been
restated for 2011 for this accounting change.The City implemented GASB Statement Nos.67 and 68 in fiscal 2015.Information
has not been restated for prior years.The City implemented GASB Statement No.75 in fiscal 2018.Information has not been
restated for prior years.
(Accrual Basis of Accounting)
Fiscal Year
City of New Hope, Minnesota
Changes in Net Position (continued)
Last Ten Fiscal Years
-100-
2015 2016 2017 2018 2019 2020
(12,813,663)$ (13,981,894)$ (14,741,672)$ (13,929,069)$ (13,008,946)$ (17,410,876)$
(417,676) 2,502,502 1,468,572 1,826,654 1,706,137 2,115,613
(13,231,339)$ (11,479,392)$ (13,273,100)$ (12,102,415)$ (11,302,809)$ (15,295,263)$
10,131,759$ 10,843,702$ 11,929,597$ 12,941,920$ 15,265,428$ 16,821,240$
430,879 492,584 841,098 1,112,753 1,317,803 1,918,857
442,556 447,248 912,357 945,244 957,448 958,162
600,030 633,056 628,119 697,895 803,035 2,497,630
331,417 377,960 531,240 798,557 1,412,308 781,304
– – 50,456 70,400 369,163 22,000
68,204 121,800 (19,110) (48,413) (144,624) (240,739)
12,004,845 12,916,350 14,873,757 16,518,356 19,980,561 22,758,454
35,700 44,708 36,811 72,531 149,296 137,468
(68,204) (121,800) 19,110 48,413 144,624 240,739
(32,504) (77,092) 55,921 120,944 293,920 378,207
11,972,341$ 12,839,258$ 14,929,678$ 16,639,300$ 20,274,481$ 23,136,661$
(808,818)$ (1,065,544)$ 132,085$ 2,589,287$ 6,971,615$ 5,347,578$
(450,180) 2,425,410 1,524,493 1,947,598 2,000,057 2,493,820
(1,258,998)$ 1,359,866$ 1,656,578$ 4,536,885$ 8,971,672$ 7,841,398$
-101-
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Ad Valorem
Property Taxes Tax Increments Franchise Taxes Total
8,784,948$ 1,400,163$ 439,795$ 10,624,906$
9,129,247 1,343,248 440,149 10,912,644
9,554,629 511,924 438,834 10,505,387
9,732,776 537,871 438,541 10,709,188
10,131,759 430,879 442,556 11,005,194
10,843,702 492,584 447,248 11,783,534
11,929,597 841,098 912,357 13,683,052
12,941,920 1,112,753 945,244 14,999,917
15,265,428 1,317,803 957,448 17,540,679
16,821,240 1,918,857 958,162 19,698,259
City of New Hope, Minnesota
Governmental Activities Tax Revenues by Source
Last Ten Fiscal Years
(Accrual Basis of Accounting)
Fiscal Year
2016
2011
2012
2013
2014
2015
2017
2018
2019
2020
-102-
2011 2012 2013 2014
General Fund
Nonspendable 14,366$ 14,925$ 15,484$ 16,005$
Unassigned 4,920,846 5,080,812 5,567,933 5,805,259
Total General Fund 4,935,212$ 5,095,737$ 5,583,417$ 5,821,264$
All other governmental funds
Restricted 6,114,114$ –$ –$ 5,687,949$
Committed 4,666,447 5,657,606 5,550,819 4,771,304
Assigned 6,877,641 5,165,192 4,511,073 7,839,792
Unassigned – 6,533,868 8,204,338 (134,792)
Total all other governmental funds 17,658,202$ 17,356,666$ 18,266,230$ 18,164,253$
Total all governmental funds 22,593,414$ 22,452,403$ 23,849,647$ 23,985,517$
Fiscal Year
City of New Hope, Minnesota
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
-103-
`
2015 2016 2017 2018 2019 2020
16,765$ 18,242$ 17,617$ 18,763$ 22,980$ 24,499$
6,063,647 6,255,436 6,871,038 7,162,188 7,116,723 8,901,587
6,080,412$ 6,273,678$ 6,888,655$ 7,180,951$ 7,139,703$ 8,926,086$
8,069,238$ 7,772,782$ 24,605,109$ 24,646,820$ 13,304,922$ 9,016,306$
5,431,288 5,397,075 5,837,809 5,414,740 5,033,555 4,639,390
5,496,484 4,958,094 5,176,318 5,695,269 6,248,128 6,993,400
(226,356) (3,015,315) (4,178,684) (3,448,208) (2,475,320) (2,119,931)
18,770,654$ 15,112,636$ 31,440,552$ 32,308,621$ 22,111,285$ 18,529,165$
24,851,066$ 21,386,314$ 38,329,207$ 39,489,572$ 29,250,988$ 27,455,251$
-104-
2011 2012 2013 2014
Revenues
Property taxes 8,767,959$ 9,199,381$ 9,531,663$ 9,718,800$
Tax increments 1,400,163 1,343,248 511,924 537,871
Franchise taxes 439,795 440,149 438,834 438,541
Licenses and permits 359,530 238,943 273,117 353,973
Intergovernmental 1,599,253 858,816 4,463,113 818,825
Charges for services 1,544,369 1,557,898 1,585,964 1,663,153
Fines and forfeits 255,329 283,233 239,201 215,585
Special assessments 153,835 305,818 178,335 98,617
Investment income 548,548 307,032 178,217 248,013
Miscellaneous 115,183 80,073 111,443 129,980
Total revenues 15,183,964 14,614,591 17,511,811 14,223,358
Expenditures
General government 1,560,511 1,567,301 1,571,701 1,668,474
Public safety 5,933,201 5,946,209 5,967,599 6,397,860
Public works 1,079,884 1,192,760 1,254,201 1,225,551
Culture and recreation 1,560,486 1,599,041 1,613,518 1,761,961
Economic development 289,650 304,064 582,621 298,825
Capital outlay 5,263,935 7,685,819 4,239,938 3,000,518
Debt service
Principal retirement 1,005,000 330,000 340,000 350,000
Interest 247,973 270,613 306,462 212,025
Bond issuance 93,820 104,351 – 2,200
Total expenditures 17,034,460 19,000,158 15,876,040 14,917,414
Excess of revenues
over (under) expenditures (1,850,496) (4,385,567) 1,635,771 (694,056)
Other financing sources (uses)
Transfers in 2,477,195 936,188 360,427 669,461
Sale of capital assets – – 1,460 4,055,382
Bonds issued – – – –
Premiums on debt issues – 54,006 – –
Refunding bonds issued – 4,025,000 – –
Payments to refunded bond escrow agent – – – (3,780,000)
Transfers (out)(4,569,216) (770,638) (600,414) (477,461)
Total other financing sources (uses)(2,092,021) 4,244,556 (238,527) 467,382
Net change in fund balances (3,942,517)$ (141,011)$ 1,397,244$ (226,674)$
Debt service as a percentage of noncapital
expenditures 6.4%4.1%5.6%4.5%
Fiscal Year
City of New Hope, Minnesota
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
-105-
2015 2016 2017 2018 2019 2020
10,145,204$ 10,868,985$ 11,961,711$ 12,904,297$ 15,223,680$ 16,756,108$
430,879 492,584 841,098 1,112,753 1,317,803 1,918,857
442,556 447,248 912,357 945,244 957,448 958,162
389,957 466,548 641,870 367,931 320,438 393,911
1,359,511 2,063,546 1,844,648 2,195,761 3,947,039 4,289,738
1,601,081 1,571,798 1,727,615 1,399,998 1,376,176 986,887
237,591 191,960 208,909 230,657 227,343 138,922
38,417 173,158 92,458 282,589 197,566 234,265
274,116 304,252 486,746 658,606 1,166,238 607,490
202,057 42,103 137,591 33,966 173,679 26,700
15,121,369 16,622,182 18,855,003 20,131,802 24,907,410 26,311,040
1,688,752 1,872,436 2,622,277 1,787,553 1,900,480 2,062,733
6,866,105 7,168,102 7,724,950 7,997,311 8,427,939 8,361,209
1,328,371 1,606,369 1,671,593 1,717,815 1,790,715 1,853,395
1,853,741 1,938,131 2,066,692 2,015,729 2,032,585 2,035,658
498,479 588,167 1,737,947 815,352 513,946 1,291,350
8,204,694 8,220,964 5,217,461 12,956,485 22,573,850 8,669,758
405,000 415,000 523,497 799,734 968,674 1,905,890
131,530 257,661 455,539 769,497 1,273,302 1,778,653
114,607 58,188 251,648 148,365 90,446 –
21,091,279 22,125,018 22,271,604 29,007,841 39,571,937 27,958,646
(5,969,910) (5,502,836) (3,416,601) (8,876,039) (14,664,527) (1,647,606)
3,209,226 1,630,270 4,305,261 788,458 2,162,676 418,661
– – – – 331,299 –
– 2,824,075 18,435,000 9,520,000 5,235,000 –
171,339 107,553 1,857,609 476,673 454,261 –
6,470,000 – – – – –
– – – – – –
(3,015,226) (1,426,570) (4,238,376) (748,726) (1,981,951) (566,792)
6,835,339 3,135,328 20,359,494 10,036,405 6,201,285 (148,131)
865,429$ (2,367,508)$ 16,942,893$ 1,160,366$ (8,463,242)$ (1,795,737)$
3.5%4.6%5.4%9.2%12.6%18.7%
-106-
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Ad Valorem
Property Tax Tax Increments Franchise Tax Total
8,767,959$ 1,400,163$ 439,795$ 10,607,917$
9,199,381 1,343,248 440,149 10,982,778
9,531,663 511,924 438,834 10,482,421
9,781,800 537,871 438,541 10,758,212
10,145,204 430,879 442,556 11,018,639
10,868,985 492,584 447,248 11,808,817
11,961,711 841,098 912,357 13,715,166
12,904,297 1,112,753 945,244 14,962,294
15,223,680 1,317,803 957,448 17,498,931
16,756,108 1,918,857 958,162 19,633,127
City of New Hope, Minnesota
General Governmental Tax Revenues by Source
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
Fiscal Year
2016
2011
2012
2013
2014
2015
2017
2018
2019
2020
-107-
2011 2012 2013 2014
Taxable market value
Real property 1,492,408,000$ 1,321,463,913$ 1,214,204,483$ 1,224,417,514$
Personal property 8,162,100 8,515,600 9,657,700 10,849,800
Total taxable market value 1,500,570,100$ 1,329,979,513$ 1,223,862,183$ 1,235,267,314$
Estimated actual value
of taxable property 1,504,929,000$ 1,438,796,300$ 1,336,539,900$ 1,346,449,200$
Taxable market value as a percentage
of estimated actual value 99.71% 92.44% 91.57% 91.74%
Tax capacity
Real property 18,462,796$ 16,686,170$ 15,476,014$ 15,454,712$
Personal property 159,492 165,812 188,654 211,746
Subtotal 18,622,288 16,851,982 15,664,668 15,666,458
Less tax increment (1,044,830) (944,560) (366,752) (377,138)
Less contribution to fiscal disparities (2,466,459) (2,380,423) (2,255,476) (2,154,731)
Add distribution from fiscal disparities 3,896,651 3,605,075 3,448,346 3,437,911
Net tax capacity 19,007,650$ 17,132,074$ 16,490,786$ 16,572,500$
Tax levies
Revenue 9,036,625 9,066,928 9,406,483 9,556,483
Bonds and interest 192,105 161,802 164,325 161,487
Total 9,228,730$ 9,228,730$ 9,570,808$ 9,717,970$
Tax capacity rate
Revenue 47.92 53.84 57.80 57.62
Bonds and interest 1.03 0.97 1.01 0.97
Sewer district 0.31 0.39 – –
Total direct tax rate 49.25 55.20 58.81 58.60
Fiscal Year
City of New Hope, Minnesota
Tax Capacity, Market Value and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
(Accrual Basis of Accounting)
-108-
2015 2016 2017 2018 2019 2020
1,323,173,828$ 1,419,351,117$ 1,522,726,514$ 1,683,833,465$ 1,817,473,851$ 2,007,332,223$
11,343,900 11,588,000 1,232,600 13,258,900 13,963,100 14,049,900
1,334,517,728$ 1,430,939,117$ 1,523,959,114$ 1,697,092,365$ 1,831,436,951$ 2,021,382,123$
1,440,652,000$ 1,534,397,300$ 1,636,865,900$ 1,792,927,900$ 1,921,182,700$ 2,106,273,300$
92.63% 93.26% 93.78% 94.65% 95.33% 95.97%
16,638,481$ 17,898,058$ 19,196,854$ 21,143,125$ 22,506,796$ 25,019,326$
221,628 226,510 242,052 260,678 275,032 276,748
16,860,109 18,124,568 19,438,906 21,403,803 22,781,828 25,296,074
(338,715) (362,633) (604,222) (810,429) (948,691) (1,378,781)
(2,144,256) (2,277,639) (2,464,382) (2,655,561) (2,870,420) (2,941,213)
3,505,922 3,437,652 3,757,080 4,010,408 4,111,736 4,385,923
17,883,060$ 18,921,948$ 20,127,382$ 21,948,221$ 23,074,453$ 25,362,003$
9,938,265 10,617,194 11,362,957 12,043,578 12,722,208 13,094,054
163,902 195,819 604,444 869,164 2,579,402 3,750,662
10,102,167$ 10,813,013$ 11,967,401$ 12,912,742$ 15,301,610$ 16,844,716$
55.07 56.36 56.91 54.64 56.54 51.37
0.91 1.04 3.03 3.95 11.45 14.72
– – – – – –
55.98 57.41 59.93 58.59 67.99 66.09
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Total Direct
Sewer and
General Debt District City Hennepin ISD No. 281 Special Overlapping
Levy Levy Levy Total County Robbinsdale Districts Rates
47.916 1.025 0.308 49.249 45.840 34.387 10.068 139.544
53.842 3.097 0.387 57.326 48.231 32.534 10.422 148.513
57.802 1.010 – 58.812 49.461 32.347 10.933 151.553
57.622 0.977 – 58.599 49.959 34.777 11.307 154.642
55.073 0.905 – 55.978 46.398 33.226 10.561 146.163
56.364 1.041 – 57.405 45.356 33.833 10.432 147.026
56.906 3.025 – 59.931 44.087 31.612 10.214 145.844
54.643 3.946 – 58.589 42.808 31.957 9.052 142.406
56.539 11.451 – 67.990 41.861 29.909 8.885 148.645
51.374 14.715 – 66.089 41.084 26.447 8.376 141.996
Note:
Source:Hennepin County/Treasurer Department
2011
2018
2019
City of New Hope, Minnesota
Property Tax Rates
Direct and Overlapping Governments
Last Ten Fiscal Years
Year
Overlapping RatesDirect Rates – City of New Hope
2012
2017
Overlapping rates are those of local and county governments that apply to property owners within the City.Not all overlapping
rates apply to all city property owners (e.g.,the rates for special districts apply only to the proportion of the government’s
property owners whose property is located within the geographic boundaries of the special district).
2013
2014
2015
2016
2020
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Net Tax Net Tax
Capacity Rank Capacity Rank
Alatus New Hope I LLC 352,500$ 1 1.4 %–$ – – %
STNL (New Hope), LLC 269,250 2 1.1 – – –
Allen Group, LLC 224,770 3 0.9 – – –
Paddock Property Ltd. Partnership 220,630 4 0.9 156,730 2 0.8
St. Therese Home, Inc.200,530 5 0.8 148,763 3 0.8
CI Minn I-A, LLC 200,510 6 0.8 – – –
Omega Healthcare Investors 200,225 7 0.8 – – –
GLP US Management, LLC 199,510 8 0.8 – – –
Broadway Lanel/Golle/Holmes 197,650 9 0.8 132,250 8 0.7
FLS Properties LLC 197,050 10 0.8 – – –
Geneva Management Service, LLC – – – 159,250 1 0.9
Cobalt Industrial Reit – – – 143,850 4 0.8
New Hope Distribution Center, LLC – – – 139,250 5 0.7
Long Ridge Industrial Portfolio – – – 135,250 6 0.7
Minnesota Masonic Home/
NorthRidge Care Center – – – 133,450 7 0.7
New Hope/U.S. Swim Partnership – – – 131,250 9 0.7
Welsh Corporate Headquarters – – – 129,250 10 0.7
Total 2,262,625$ 8.9 %1,409,293$ 7.6 %
Source:Hennepin County/Treasurer Department
Applied Tax
CapacityTaxpayerCapacity
Applied Tax
Current Year and Nine Years Ago
Principal Property Taxpayers
City of New Hope, Minnesota
Percentage of
2020 2011
Percentage of
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Total Tax Collections in
Levy for Subsequent
Fiscal Year Amount (2)Years (3)Amount
9,228,730$ 9,063,615$ 98.21 %165,115$ 9,228,730$ 100.00 %
9,228,730 9,102,355 98.63 126,375 9,228,730 100.00
9,570,808 9,429,858 98.53 140,950 9,570,808 100.00
9,717,970 9,619,447 98.99 98,523 9,717,970 100.00
10,102,167 10,017,500 99.16 75,335 10,092,835 99.91
10,813,013 10,756,992 99.48 49,626 10,806,618 99.94
11,967,401 11,895,137 99.40 66,405 11,961,542 99.95
12,912,742 12,834,660 99.40 68,017 12,902,677 99.92
15,301,610 15,172,300 99.15 92,796 15,265,096 99.76
16,844,716 16,662,434 98.92 47,340 16,709,774 99.20
(1)
(2)
(3)
Collected Within the
City of New Hope, Minnesota
Fiscal Year
of Levy
Percentage
Fiscal Year of the Levy
2018
Total Collections to Date
Property Tax Levies and Collections (1)
2017
2015
Last Ten Fiscal Years
of Levy
Ended
2013
2012
2016
2011
2014
December 31,
Percentage
2020
Does not include tax increments levied and collected.
Includes current year cancellations, abatements, and state paid tax credits.
Includes county adjustments for prior year over collections, cancellations, and abatements.
2019
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General Tax Lease General
Obligation Increment Revenue Obligation
Bonds Bonds Total Bonds Bonds
1,245,000$ 4,410,000$ 5,655,000$ 3,505,000$ –$
1,120,000 8,230,000 9,350,000 3,505,000 –
1,000,729 8,065,761 9,066,490 3,505,000 –
863,620 4,066,223 4,929,843 3,505,000 –
2,898,167 8,250,291 11,148,458 3,505,000 1,831,607
5,682,679 7,968,655 13,651,334 3,505,000 3,934,522
25,713,493 7,687,463 33,400,956 3,505,000 3,833,158
35,323,386 7,140,876 42,464,262 3,505,000 3,757,852
40,433,000 6,582,397 47,015,397 3,505,000 3,509,802
38,930,476 6,005,590 44,936,066 3,505,000 3,285,833
(1)
Note:
City of New Hope, Minnesota
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
See the Schedule of Demographic and Economic Statistics for personal income and population data.
Details regarding the City’s outstanding debt can be found in the notes to basic financial statements.
2017
2012
2013
2014
2015
2016
2018
2019
2020
Governmental Activities
Business-Type
Activities
Fiscal Year
2011
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G.O.G.O.
Revenue Tax Increment Total Primary
Bonds Bonds Total Government Per Capita (1)
2,360,095$ –$ 5,865,095$ 11,520,095$ 1.04 %562$
2,033,000 – 5,538,000 14,888,000 1.25 717
2,723,628 – 6,228,628 15,295,118 1.24 732
2,352,553 – 5,857,553 10,787,396 0.86 518
2,151,635 1,587,602 9,075,844 20,224,302 1.49 953
1,950,071 1,586,242 10,975,835 24,627,169 1.75 1,140
1,748,533 1,584,964 10,671,655 44,072,611 3.03 2,046
1,540,021 1,494,575 10,297,448 52,761,710 3.41 2,421
1,326,532 1,401,536 9,742,870 56,758,267 3.57 2,537
1,111,126 1,307,253 9,209,212 54,145,278 3.16 2,420
Ratios of Outstanding Debt by Type
Percentage
Income (1)
of Personal
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Less Amounts
General Restricted for Total
Obligation Repaying Net Bonded
Bonds Principal Debt Per Capita
8,015,095$ 465,243$ 7,549,852$ 0.502 %369$
11,383,000 4,222,494 7,160,506 0.498 345
11,790,118 345,010 11,445,108 0.856 548
7,282,396 614,161 6,668,235 0.495 320
16,719,302 759,386 15,959,916 1.108 752
21,122,169 1,048,498 20,073,671 1.308 929
40,567,611 2,173,637 38,393,974 2.346 1,782
49,226,710 1,793,587 47,433,123 2.646 2,177
53,253,267 3,193,279 50,059,988 2.606 2,237
50,640,278 3,780,748 46,859,530 2.225 2,094
Note 1:
Note 2:
Note 3:
City of New Hope, Minnesota
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years
Taxable Value
Estimated Actual
Percentage of
Fiscal Year
2011
Details regarding the City’s outstanding debt can be found in the notes to basic financial statements.
2012
2016
2017
2013
of Property
Population data can be found in the Schedule of Demographic and Economic Statistics.
2014
2018
2019
2020
2015
See the Schedule of Tax Capacity,Market Value,and Estimated Actual Value of Taxable Property for property
value data.
-115-
Estimated
Debt Share of
Outstanding Overlapping Debt
Direct debt
City of New Hope 44,936,066$ 100.00 %44,936,066$
Overlapping debt
Hennepin County 998,790,298 1.08 10,786,935
ISD No. 281, Robbinsdale 172,139,921 19.87 34,204,202
Three Rivers Park District 42,954,642 1.55 665,797
Hennepin Regional RR Authority 93,859,422 1.08 1,013,682
Metropolitan Council 103,255,628 0.55 567,741
Total overlapping debt 1,410,999,911$ 47,238,357
Total direct and overlapping debt 92,174,423$
(1)
Note:
Source:
Overlapping governments are those that coincide,at least in part,with the geographic boundaries of the City.This
schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the
residents and businesses of the City.This process recognizes that,when considering the City’s ability to issue and
repay long-term debt,the entire debt burden borne by the residents and businesses should be taken into account.
However,this does not imply that every taxpayer is a resident and,therefore,responsible for repaying the debt of
each overlapping government.
Hennepin County Taxpayer Services
City of New Hope, Minnesota
Direct and Overlapping Governmental Activities Debt
as of December 31, 2020
Estimated
Percentage
Governmental Unit Applicable (1)
The percentages of overlapping debt applicable is estimated using taxable market property values.Applicable
percentages were estimated by determining the portion of the county’s taxable market value that is within the City’s
boundaries and dividing it by the county’s total taxable market value.
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2011 2012 2013 2014
Debt limit 45,017,103$ 39,899,385$ 36,715,865$ 37,058,019$
Total net debt applicable to the limit 1,072,678 970,908 839,948 696,627
Legal debt margin 43,944,425$ 38,928,477$ 35,875,917$ 36,361,392$
Total net debt applicable to the limit
as a percentage of the debt limit 2.38% 2.43% 2.29% 1.88%
Note:Under state finance law,the City’s outstanding general obligation debt should not exceed 3 percent of total market
property value.By law,the general obligation debt subject to the limitation may be offset by amounts set aside for
repaying general obligation bonds.
City of New Hope, Minnesota
Legal Debt Margin Information
Last Ten Fiscal Years
Fiscal Year
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2015 2016 2017 2018 2019 2020
40,035,532$ 42,928,174$ 46,051,623$ 50,912,771$ 54,943,109$ 60,641,464$
2,719,528 5,497,493 25,516,878 34,249,431 38,595,992 36,361,673
37,316,004$ 37,430,681$ 20,534,745$ 16,663,340$ 16,347,117$ 24,279,791$
6.79% 12.81% 55.41% 67.27% 70.25% 59.96%
Market value 2,021,382,123$
Debt limit (3 percent of market value)60,641,464
Debt applicable to limit
General obligation bonds 38,930,476
Less amount available in debt service funds (2,568,803)
Total net debt applicable to the limit 36,361,673
Legal debt margin 24,279,791$
Legal Debt Margin Calculation for Fiscal Year 2020
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(1)(2)Net
Gross Operating Available
Revenue Expenses Revenue Principal Interest
6,646,747$ 5,527,230$ 1,119,517$ 981,643$ 74,418$ 106.01 %
7,676,193 6,493,865 1,182,328 334,000 162,686 238.04
7,901,855 6,573,932 1,327,923 344,000 98,588 300.04
7,887,948 7,270,310 617,638 371,000 103,685 130.12
8,039,067 7,925,903 113,164 201,000 97,854 37.87
8,738,270 6,629,232 2,109,038 202,000 172,262 563.52
9,181,674 6,850,851 2,330,823 293,503 228,142 446.82
10,247,826 7,479,247 2,768,579 394,266 232,928 441.42
10,292,470 7,408,536 2,883,934 515,326 251,673 376.00
11,287,052 8,203,328 3,083,724 525,110 245,526 400.15
(1)
(2)Operating expenses exclude depreciation.
(3)
Note:Details regarding the City’s outstanding debt can be found in the notes to basic financial statements.Gross revenue
includes investment earnings and intergovernmental grants. Operating expenses do not include interest.
Gross revenues include interest and other nonoperating revenues.
2017
2020
Revenues and expense include the Storm Water, Water Utility, Sewer Utility, and Ice Arena Funds.
City of New Hope, Minnesota
Pledged Revenue Coverage
Last Ten Fiscal Years
2011
2019
2018
Fiscal Year
Debt Service
Coverage
Revenue Bonds (3)
2016
2015
2014
2013
2012
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Per Capita Total
Personal Personal Median School
Population (1)Income (2)Income (3)Age (4)Enrollment (5)
20,486 54,008$ 1,106,407,888$ 39.4 11,804 5.6 %
20,764 57,476 1,193,431,664 39.4 12,126 4.8
20,904 58,898 1,231,203,792 39.4 12,126 4.0
20,812 60,601 1,261,228,012 39.4 12,390 2.9
21,225 63,901 1,356,298,725 39.4 12,313 2.8
21,600 65,231 1,408,989,600 39.4 12,404 2.8
21,545 67,427 1,452,714,715 39.4 12,011 3.5
21,790 70,067 1,526,759,930 39.4 12,304 2.7
22,376 71,067 1,590,195,192 39.4 12,237 2.7
22,376 76,552 1,712,927,552 36.4 12,397 8.6
(1)Provided by the Metropolitan Council. The most recent year is an estimate.
(2)
(3)
(4)
(5)
(6)
City of New Hope, Minnesota
Rate (6)
UnemploymentFiscal
Demographic and Economic Statistics
Last Ten Fiscal Years
Year
Sources:
Provided by the Bureau of Labor Statistics; U.S. Department of Labor. This figure is for all of Hennepin County.
2014
Calculated by multiplying the estimated population by the per capita personal income figure.
2011
Provided by Independent School District No. 281, Robbinsdale, Minnesota.
U.S. Census Bureau.
2012
2013
2015
2016
Provided by the Bureau of Economic Analysis; U.S. Department of Commerce. This figure is for all of Hennpin County.
2017
2018
2019
2020
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Employees Rank Employees Rank
Independent School District No. 281 791 1 7.6 %2,200 1 21.5 %
Hy-Vee 632 2 6.1 – – –
Mission Health/North Ridge Care Center 560 3 5.4 789 2 7.7
Saint Therese Home of New Hope 544 4 5.3 650 3 6.4
Horwitz 345 5 3.3 – – –
Perrigo Company 323 6 3.1 413 4 4.0
Independent School District No. 287 266 7 2.6 – – –
YMCA 228 8 2.2 – – –
Liberty Diversified International 200 9 1.9 200 7 2.0
Parker-Hannifin Oildyne Division 172 10 1.7 135 10 1.3
Navarre Corporation – – – 280 5 2.7
Coborn’s Delivers – – – 240 6 2.3
Dakota Growers Pasta – – – 200 8 2.0
Waymouth Farms, Inc.– – – 137 9 1.3
4,061 39.2 %5,244 51.2 %
Source:Minnesota Department of Employment and Economic Development
Employer Employment
City of New Hope, Minnesota
Employment
of Total City
Percentage
2011
Percentage
Current Year and Nine Years Ago
2020
of Total City
Principal Employers
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2011 2012 2013 2014
Function
General government 15 15 16 14
Public safety
Police
Officers 31 30 31 33
Civilians 6 7 7 7
Public works 24 24 24 24
Culture and recreation 7 6 7 7
Total 83 82 85 85
Source: Various city departments
City of New Hope, Minnesota
Full-Time Equivalent City Government Employees by Function
Last Ten Fiscal Years
Fiscal Year
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`
2015 2016 2017 2018 2019 2020
13 13 16 17 17 17
35 33 34 34 34 34
9 9 10 11 10 10
23 24 24 24 24 24
7 8 7 7 7 8
87 87 91 93 92 93
-123-
2011 2012 2013 2014
Function
4 – – –
648 687 600 1,330
Culture and recreation
5,271 5,598 4,565 3,121
5,287 5,323 7,442 5,734
146,305 148,966 144,000 122,478
Golf course
Rounds of golf at the municipal course 18,788 19,568 16,782 16,431
Ice arena
Hours of ice time rental 3,903 3,558 3,739 3,734
Water
Water main breaks 32 26 30 27
Average daily consumption
(thousands of gallons)1,712 1,828 1,682 1,571
Sewer
Average daily treatment (thousands of gallons)2,253 2,189 1,500 2,200
Note:Indicators are not available for the general government function.
Source:Various city departments
City of New Hope, Minnesota
Operating Indicators by Function
Last Ten Fiscal Years
Attendance at sponsored events
Street resurfacing (miles)
Potholes repaired
Program registration – adults
Program registration – youth
Public works
Fiscal Year
-124-
2015 2016 2017 2018 2019 2020
12 3 3 3 4 4
2,882 3,025 2,530 3,000 2,900 2,900
2,746 3,343 3,011 2,603 1,860 1,426
5,815 6,043 5,969 5,413 4,695 3,325
124,777 127,865 127,112 102,659 101,409 69,415
18,175 20,375 18,662 17,800 16,837 26,553
3,683 3,567 4,030 4,151 4,202 2,984
21 19 12 23 14 18
1,559 1,588 1,616 1,616 1,551 1,775
1,670 1,800 1,352 1,405 1,355 1,451
-125-
2011 2012 2013 2014
Function
Public safety
Police stations 1 1 1 1
Fire stations 3 3 3 3
Public works
Highways and streets 64.0 64.0 64.0 64.0
City streets (miles)8.5 8.5 8.5 8.5
State and county streets (miles)26.4 26.4 26.4 26.4
Sidewalks (miles)580.0 580.0 580.0 580.0
Streetlights 2.0 2.0 2.0 2.0
Railroad bridges 4.0 4.0 4.0 4.0
Culture and recreation
Parks 23 23 23 23
Swimming pools
Olympic 1 1 1 1
Recreational 1 1 1 1
Outdoor theatre 1 1 1 1
Tennis courts 17 17 17 17
Water
Water main (miles)63 63 63 63
Fire hydrants 690 690 690 690
Maximum daily capacity 21,000,000 21,000,000 21,000,000 21,000,000
Sewer
Sanitary sewer main (miles)74 74 74 74
Storm sewer lines (miles)56 56 56 56
Ice arenas 1 1 1 1
Golf courses 1 1 1 1
Source:Various city departments
Fiscal Year
City of New Hope, Minnesota
Capital Asset Statistics by Function
Last Ten Fiscal Years
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2015 2016 2017 2018 2019 2020
1 1 1 1 1 1
3 3 3 3 3 3
64.0 64.0 64.0 64.0 64.0 64.8
8.5 8.5 8.5 8.5 8.5 8.5
26.4 26.4 27.0 27.0 27.0 27.3
580.0 619.0 619.0 619.0 630.0 630.0
2.0 2.0 2.0 2.0 2.0 2.0
4.0 4.0 4.0 4.0 4.0 4.0
23 23 23 23 23 23
1 1 1 – – –
1 1 1 – – –
1 1 1 1 – –
17 17 17 17 17 12
63 64 64 64 64 65
690 690 690 690 690 716
21,000,000 21,000,000 21,000,000 21,000,000 21,000,000 21,000,000
74 75 75 75 75 75
56 56 56 56 56 57
1 1 1 1 1 1
1 1 1 1 1 1
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