2021 New Hope ACFRCITY OF NEW HOPE
NEW HOPE, MINNESOTA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE YEAR ENDED
DECEMBER 31, 2021
CITY OF NEW HOPE
HENNEPIN COUNTY, MINNESOTA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE YEAR ENDED
DECEMBER 31, 2021
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–vii
GFOA CERTIFICATE OF ACHIEVEMENT viii
ORGANIZATIONAL CHART ix
CITY COUNCIL AND OTHER OFFICIALS x
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 36–69
REQUIRED SUPPLEMENTARY INFORMATION
PERA – General Employees Retirement Fund
Schedule of City’s and Nonemployer Proportionate Share of Net Pension Liability 70
Schedule of City Contributions 70
PERA – Public Employees Police and Fire Fund
Schedule of City’s and Nonemployer Proportionate Share of Net Pension Liability 71
Schedule of City Contributions 71
Other Post-Employment Benefits Plan
Schedule of Changes in the City’s Total OPEB Liability and Related Ratios 72
Notes to Required Supplementary Information 73–78
CITY OF NEW HOPE
HENNEPIN COUNTY, MINNESOTA
Table of Contents
Page
COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND SCHEDULES
Nonmajor Governmental Funds
Combining Balance Sheet 79
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 80
Nonmajor Special Revenue Funds
Subcombining Balance Sheet 81
Subcombining Statement of Revenues, Expenditures, and Changes in Fund Balances 82
Schedule of Revenues, Expenditures, and Changes in Fund Balances –
Solid Waste Management Fund – Budget and Actual 83
Nonmajor Capital Projects Funds
Subcombining Balance Sheet 84–85
Subcombining Statement of Revenues, Expenditures, and Changes in Fund Balances 86–87
Nonmajor Debt Service Funds
Subcombining Balance Sheet 88–89
Subcombining Statement of Revenues, Expenditures, and Changes in Fund Balances 90–91
General Fund
Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual 92–95
Internal Service Funds
Combining Statement of Net Position 96
Combining Statement of Revenues, Expenses, and Changes in Net Position 97
Combining Statement of Cash Flows 98
STATISTICAL SECTION (UNAUDITED)
Financial Trends
Net Position by Component 99–100
Changes in Net Position 101–104
Governmental Activities Tax Revenues by Source 105
Fund Balances of Governmental Funds 106–107
Changes in Fund Balances of Governmental Funds 108–109
General Government Tax Revenues by Source 110
Revenue Capacity
Tax Capacity, Market Value, and Estimated Actual Value of Taxable Property 111–112
Property Tax Rates – Direct and Overlapping Governments 113
Principal Property Taxpayers 114
Property Tax Levies and Collections 115
Debt Capacity
Ratios of Outstanding Debt by Type 116–117
Ratios of General Bonded Debt Outstanding 118
Direct and Overlapping Governmental Activities Debt 119
Legal Debt Margin Information 120–121
Pledged Revenue Coverage 122
Demographic and Economic Information
Demographic and Economic Statistics 123
Principal Employers 124
Operating Information
Full-Time Equivalent City Government Employees by Function 125–126
Operating Indicators by Function 127–128
Capital Asset Statistics by Function 129–130
CITY OF NEW HOPE
HENNEPIN COUNTY, MINNESOTA
Table of Contents (continued)
INTRODUCTORY SECTION
CITY OF NEW HOPE, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2021
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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 31, 2022
Honorable Mayor and City Council
City of New Hope
4401 Xylon Avenue North
New Hope, MN 55428-4898
The Annual Comprehensive Financial Report (ACFR) of the City of New Hope, Minnesota (the City), for
the fiscal year ended December 31, 2021, 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 financial 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 21,986. 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.
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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.
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, a nd
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’s 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 primary
government’s operations and are included as part of the primary government. Accordingly, the New Hope
Economic Development Authority (EDA) is reported as special revenue fund of the primary government
and the Housing and Redevelopment Authority 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.
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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 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 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.
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} attr acting 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 2021. 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 2021, $28,894,527 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.
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PLANNING AND DEVELOPMENT
The following planning and development activities occurred in 2021:
New Hope Aquatic Center
A new police department and City Hall for the City of New Hope opened in July of 2019. The pool that
was previously located where the new police department and city hall were constructed was demolished
and was 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 a rea,
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. A 2020 opening was
planned, but postponed until June 2021, due to the COVID-19 pandemic. The open swim attendance for
ages two and older was approximately 46,863, compared to 18,761 at the old facility in 2017. Ot her
improvements within the park area where the pool is located included a new outdoor performance center
with terraced seating, a picnic pavilion, skate park, trails, trail lighting, and an additional parking lot.
Windsor Ridge
SVK Development constructed 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
2022, all 32 homes within the development had sold for an average price of $430,000, bringing
$13.76 million in new value to the City.
Pocket Square Cocktail Lounge
A. Davis Distillery received a conditional use permit in January 2020 to open a microdistillery and cocktail
room at 7530 Quebec Avenue North. Due to the COVID-19 pandemic, Pocket Square Cocktail Lounge did
not open until the spring of 2021. The distillery serves hand-crafted cocktails and small 750 ml. bottles of
handmade liquor that are produced on-site. Patrons can enjoy beverages in their lounge or on their outside
patio.
Hamernick’s Flooring Superstore
Hamernick’s Flooring Superstore opened a location at 9449 Science Center Drive in New Hope in the
spring of 2021. Hamernick’s started in Saint Paul 75 years ago as a small carpet and paint store. The New
Hope Hamernick’s specializes in luxury vinyl tile and luxury vinyl plank flooring, which is one of the most
popular trends currently in floor design. Hamernick’s moved into the space that was previously occupied
by Superior Decks and Railings.
Hy-Vee Aisles Online
In 2021, the City Council approved an amendment to Hy-Vee’s Planned Unit Development for the
construction of a 1,200 square-foot drive-through kiosk on the west side of the grocery store at 8200 42nd
Avenue North. This includes four drive-through grocery pick-up lanes with an overhead canopy, new
curbing, and landscaping around the building. Customers purchase their groceries online and drive to the
kiosk to pick them up. The groceries are delivered directly to the kiosk from the main Hy -Vee store. The
drive-through kiosk was completed in the spring of 2022 and opened shortly thereafter.
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Escuela Exitos
In April of 2021, the City Council approved a Conditional Use Permit for Escuela Exitos to open a Spanish
immersion school at 4741 Zealand Avenue North. This property was previously owned by a church. The
charter school is a Kindergarten through Grade 8, two-way dual language Spanish/English immersion
school. It was estimated that the school would serve 165 students during the 2021–2022 school year, with
enrollment increasing and capping out at 390 students by the 2023–2024 school year. According to the
operator, the school model meets a growing demand of families in New Hope and surrounding communities
that currently sit on long waitlists for immersion school options.
Housing
The City’s commitment to maintaining its housing stock is supported through a variety of cooperative
projects and programs. Approximately $8,557,000 was reinvested in the City’s housing stock in 2021 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 2021 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 was rehabilitated in
2021.
ii. The City continued to operate its scattered site housing program by acquiring
multiple properties for demolition and new construction. Since 2014, the EDA has
acquired 19 properties, resulting in the creation of 23 vacant lots. The lots
purchased by the City are located at 7215, 7303, 7311, and 9121 62nd Avenue
North, 4637 Aquila 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, 5306 Rhode Island 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 – 804 inspections completed in 2021.
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 the residents with a vast array of park amenities and recreation opportunities
at an affordable cost. In 2021, staff continued to maintain 18 parks, 4 additional school district parks
(summer only), 2 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.
Although Covid-19 continued to have a big impact on department programs, activities, and facilities, it was
less than in 2020 and got better as the year progressed. The number of program registrations increased
31 percent over 2020 (6,497), and special events also had greater participation numbers (10,300). Use of
the new performance center was expanded to include the return of the Off-Broadway Musical Theatre
summer musicals and a new Music in the Park series.
During 2021, several park projects took place, including the replacement of the playground at Corner Park,
court resurfacing of the basketball court at Corner Park, crack filling of the pickleball courts at Meadow
Lake School Park and the tennis courts at Civic Center Park, replacement of the basketball court at Little
Acre Park, reclaim and overlay of the trails at Liberty Park, residing of the maintenance garages at Lighted
Field and Victory Park, retro-fit of the tennis court lights at both Begin and Hidden Valley parks, and added
additional drain tile to the Civic Center Park playground. In addition, engineered wood fiber was added to
several playgrounds. Buckthorn removal was continued in several parks and new signage was installed at
Corner and Civic Center parks. During the 2020–2021 winter season, parks staff continued to plow a section
of trail at Hidden Valley, Northwood and Lions parks, with Meadow Lake Park being added. Outdoor
skating areas at Hidden Valley, Lions and Liberty parks were maintained.
The inaugural aquatic park season was extremely successful. The aquatic park opened June 5 for a 10-week
season. Open swim hours were available during the week from 12–8 p.m. and on the weekends from
11 a.m.–7 p.m. The overall general swim attendance in 2021 was 46,863 (not including ages under 2). In
the mornings, programming such as swim lessons and lap swimming took place. Weekday mornings were
also when the 50-meter pool was utilized by various swim teams. The NHCP swim club along with other
local clubs used the 50-meter pool for practices and swim meets. Over the summer, the NHCP swim club
held three separate meets including a 3-day all-day regional meet in the middle of July. Staffing was one of
the biggest challenges of the season with a national lifeguard shortage and the hiring of more than 70 brand
new staff.
The ice arena was back to offering year-round use of ice time for youth, adult recreational, league hockey
and skating lessons, with COVID-19 restrictions lessening as the year went on. Facility use was strong and
program participation numbers were significantly better than 2020. Rented ice hours were 4,416, which
was an increase of 38 percent from 2020 (due in part from the hockey season extended into April), high
school admissions increased 93 percent (4,601), open skating increased by 43 percent (1,641), and skate
lesson registrations also increased. CIP projects included the replacement of the desiccant unit and
replacement of the roof and skylight for the south ice arena. The advertising agreement and concession
stand agreement were both renewed for an additional three years with the Armstrong Cooper Youth Hockey
Association. The dryland training agreement continued with Charleston Overspeed.
The golf course continued to offer leagues, lessons, tournaments, open golf , and picnic rentals. It was
another extremely busy year for the golf course, with the course opening on March 13. Several highs were
realized, including the highest number of rounds played since 2003 (27,654), all time high for the amount
of revenue ($470,491), most rounds recorded in October (2,378), and the second year in a row for rounds
played in December. League participation and equipment rentals numbers were good, and the merchandise
and concession sales were strong; with all exceeding budgeted amounts. The number of clubhouse rentals
and tournaments also increased from 2020. During the nongolf season, the clubhouse continued to be rented
to outside groups, although use was below average, due to ongoing COVID-19 restrictions and concerns.
In 2021, the HVAC in the clubhouse was replaced, some changes were made to concession equipment in
the clubhouse – a new 1-keg dispenser was added, the 3-keg dispenser was replaced with a 4-keg dispenser,
and the ice machine and drinking fountain were both replaced. A golf course utility cart was purchased, and
the golf cart lease continued. The parking agreement with Ironwood Apartments was renewed for another
year.
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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.
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 an updated long-term plan to the City Council
in 2021 that highlights the tax effect of major capital and operating decisions. This is an important document
when preparing future budgets.
AWARDS AND ACKNOWLEDGEMENTS
The Certificate of Achievement for Excellence in Financial Reporting – The GFOA of the United States
and Canada awarded a Certificate of Achievement for Excellence in Financial Reporting to the City for its
ACFR for the fiscal year ended December 31, 2020. This was the 13th 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 ACFR. 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 ACFR
continues to meet the Certificate of Achievement Program’s requirements and we are submitting it to the
GFOA of the United States and Canada 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, Abdo 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 Annual Comprehensive
Financial Report
For the Fiscal Year Ended
December 31, 2020
Executive Director/CEO
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Term Expires
Kathi Hemken Mayor 12/31/2024
John Elder Councilmember 12/31/2022
Andrew Hoffe Councilmember 12/31/2024
Michael Isenberg Councilmember 12/31/2024
Jonathan London Councilmember 12/31/2022
Kirk McDonald City Manager Appointed
Rich Johnson Director of Human Resources and Administrative Services Appointed
Jeff Sargent Director of Community Development Appointed
Susan Rader Director of Parks and Recreation Appointed
Tim Hoyt Chief of Police Appointed
Bernie Weber Director of Public Works 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, 2021
FINANCIAL SECTION
CITY OF NEW HOPE, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2021
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INDEPENDENT AUDITOR’S REPORT
To the City Council and Management
City of New Hope, Minnesota
OPINIONS
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, 2021, and the related notes to the financial
statements, which collectively comprise the City’s basic financial statements as listed in the table of
contents.
In our opinion, the financial statements referred to above 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, 2021, 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.
BASIS FOR OPINIONS
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. Our responsibilities under those standards are
further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our
report. We are required to be independent of the City and to meet our other ethical responsibilities in
accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
RESPONSIBILITIES OF MANAGEMENT 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.
In preparing the financial statements, management is required to evaluate whether there are conditions or
events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a
going concern within 12 months beyond the financial statements date, including any currently known
information that may raise substantial doubt shortly thereafter.
(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
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AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinions. Reasonable assurance is a high level of assurance, but is not absolute assurance and, therefore, is
not a guarantee that an audit conducted in accordance with generally accepted auditing standards and
Government Auditing Standards will always detect a material misstatement when it exists. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal
control. Misstatements are considered material if there is a substantial likelihood that, individually or in the
aggregate, they would influence the judgement made by a reasonable user based on the financial statements.
In performing an audit in accordance with generally accepted auditing standards and Government Auditing
Standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit.
• Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, and design and perform audit procedures responsive to those risks. Such procedures
include examining, on a test basis, evidence regarding the amounts and disclosures in the financial
statements.
• Obtain an understanding of internal control relevant to the audit 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, no such opinion is expressed.
• Evaluate the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluate the overall presentation of the
financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate,
that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable
period of time.
We are required to communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit, significant audit findings, and certain internal control related matters
that we identified during the audit.
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 is the responsibility of
management and, 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.
(continued)
-3-
Supplementary 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 combining and individual fund financial statements and
schedules, as listed in the table of contents, are presented for purpose of additional analysis and are not a
required part of the basic financial statements. Such information is the responsibility of management and
was derived from and relates directly to the underlying accounting and other records used to prep are the
basic financial statements. The 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 supplementary information is fairly stated, in all material respects, in relation to the basic financial
statements as a whole.
Other Information
Management is responsible for the other information included in the annual report. The other information
comprises the introductory and statistical sections, but does not include the basic financial statements and
our auditor’s report thereon. Our opinions on the basic financial statements do not cover the other
information, and we do not express an opinion or any form of assurance thereon.
In connection with our audit of the basic financial statements, our responsibility is to read the other
information and consider whether a material inconsistency exists between the other information and the
basic financial statements, or the other information otherwise appears to be materially misstated. If, based
on the work performed, we conclude that an uncorrected material misstatement of the other information
exists, we are required to describe it in our report.
OTHER REPORTING REQUIRED BY GOVERNMENT AUDITING STANDARDS
In accordance with Government Auditing Standards, we have also issued our report dated May 31, 2022 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 31, 2022
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CITY OF NEW HOPE
Management’s Discussion and Analysis
Year Ended December 31, 2021
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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, 2021. 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 $96,073,515 (net position). Of
this amount, $29,882,377 (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 $11,034,386. This was a result of governmental
activities and business type activities increasing net position by $8,193,901 and $2,840,485,
respectively.
• As of the close of the current fiscal year, the City’s governmental funds reported combined
ending fund balances of $30,054,786, an increase of $2,599,535 in comparison with the
prior year. Approximately 22.1 percent of this total amount, $6,646,030, 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
$8,624,063, or 51.2 percent, of total General Fund 2021 expenditures and transfers out.
• The City’s total bonded debt decreased by $4,925,562 (9.1 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
Annual Comprehensive 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, Street
Infrastructure, 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 Development
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 $96,073,515 at the end of the 2021 fiscal year.
A portion of the City’s net position (59.9 percent) reflects its investment in capital assets (e.g., land,
buildings, vehicles and equipment); less any related debt used to acquire those assets that is still
outstanding. The City uses these capital assets to provide services to citizens; consequent ly, these assets
are not available for future spending. Although the City’s investment in its capital assets is reported net of
related debt, it should be noted that the resources needed to repay this debt must be provided from other
sources, since the capital assets themselves cannot be used to liquidate these liabilities.
The following is a summary of the City’s net position at the end of the last two fiscal years:
2021 2020 2021 2020 2021 2020
Current and other assets 45,444,088$ 42,638,781$ 8,282,332$ 8,102,748$ 53,726,420$ 50,741,529$
Capital assets, net of depreciation 74,711,410 73,333,910 29,605,378 29,336,500 104,316,788 102,670,410
Total assets 120,155,498 115,972,691 37,887,710 37,439,248 158,043,208 153,411,939
Deferred outflows of resources
Deferred pension resources 5,190,055 2,315,482 492,108 99,031 5,682,163 2,414,513
Deferred other postemployment benefit resources – 167,973 – 28,471 – 196,444
Total deferred outflows of resources 5,190,055 2,483,455 492,108 127,502 5,682,163 2,610,957
Long-term liabilities
(including current portion)48,059,912 53,540,307 7,773,573 10,321,457 55,833,485 63,861,764
Other liabilities 2,123,349 1,762,636 927,287 980,838 3,050,636 2,743,474
Total liabilities 50,183,261 55,302,943 8,700,860 11,302,295 58,884,121 66,605,238
Deferred inflows of resources
Deferred pension resources 7,372,502 2,882,251 616,712 37,066 7,989,214 2,919,317
Deferred other postemployment benefit resources – 33,203 – 5,628 – 38,831
Resources received in advance 778,521 1,420,381 – –778,521 1,420,381
Total deferred inflows of resources 8,151,023 4,335,835 616,712 42,694 8,767,735 4,378,529
Net position
Net investment in capital assets 34,985,781 31,359,813 22,607,046 20,127,288 57,592,827 51,487,101
Restricted 8,598,311 7,740,859 – 1,560,053 8,598,311 9,300,912
Unrestricted 23,427,177 19,716,696 6,455,200 4,534,420 29,882,377 24,251,116
Total net position 67,011,269$ 58,817,368$ 29,062,246$ 26,221,761$ 96,073,515$ 85,039,129$
Governmental Activities Business-Type Activities Total
An additional portion of the City’s net position, $8,598,311, represents resources that are subject to
external restrictions on how they may be used. The remaining balance of unrestricted net position,
$29,882,377, may be used to meet the City’s ongoing obligations to citizens and creditors.
At the end of the current fiscal year, the City is able to report a positive balance in all three categories of
net position for both the governmental activities and the business-type activities. This was also the case at
the previous year-end.
-8-
The following table indicates the changes in net position for the City’s governmental and business-type
activities:
2021 2020 2021 2020 2021 2020
Revenues
Program revenues
Charges for services 2,335,380$ 1,504,128$ 12,681,193$ 11,627,850$ 15,016,573$ 13,131,978$
Operating grants and
contributions 1,093,760 866,861 146,755 110,331 1,240,515 977,192
Capital grants and
contributions 720,699 1,048,750 13,475 12,922 734,174 1,061,672
General revenues
Property taxes 17,357,910 16,821,240 – – 17,357,910 16,821,240
Tax increments 2,118,199 1,918,857 – – 2,118,199 1,918,857
Franchise taxes 962,395 958,162 – – 962,395 958,162
Grants and contributions not
restricted to specific programs 3,155,397 2,497,630 – – 3,155,397 2,497,630
Unrestricted investment earnings
(charges)(22,179) 781,304 39,829 137,468 17,650 918,772
Gain on sale of capital assets 70,300 22,000 – – 70,300 22,000
Total revenues 27,791,861 26,418,932 12,881,252 11,888,571 40,673,113 38,307,503
Expenses
General government 1,152,633 2,945,625 – – 1,152,633 2,945,625
Public safety 7,764,051 8,968,009 – – 7,764,051 8,968,009
Public works 4,295,427 3,725,075 – – 4,295,427 3,725,075
Culture and recreation 3,095,760 2,270,751 – – 3,095,760 2,270,751
Economic development 1,434,986 1,350,348 – – 1,434,986 1,350,348
Interest on long-term debt 1,518,351 1,570,807 – – 1,518,351 1,570,807
Sewer utility – – 2,973,301 3,096,526 2,973,301 3,096,526
Water utility – – 4,813,286 4,195,981 4,813,286 4,195,981
Golf course – – 368,659 316,173 368,659 316,173
Ice arena – – 1,095,343 1,016,296 1,095,343 1,016,296
Storm water – – 991,031 877,244 991,031 877,244
Street lighting – – 135,899 133,270 135,899 133,270
Total expenses 19,261,208 20,830,615 10,377,519 9,635,490 29,638,727 30,466,105
Change in net position
before transfers 8,530,653 5,588,317 2,503,733 2,253,081 11,034,386 7,841,398
Transfers – internal activities (336,752) (240,739) 336,752 240,739 – –
Change in net position 8,193,901 5,347,578 2,840,485 2,493,820 11,034,386 7,841,398
Net position
Beginning 58,817,368 53,469,790 26,221,761 23,727,941 85,039,129 77,197,731
Ending 67,011,269$ 58,817,368$ 29,062,246$ 26,221,761$ 96,073,515$ 85,039,129$
TotalGovernmental Activities Business-Type Activities
Governmental activities increased the City’s net position by $8,193,901 in 2021, while business-type
activities increased net position by $2,840,485. Charges for services increased in 2021, due to the opening
of the new swimming pool and return to programs that were cancelled, due to the COVID-19 pandemic in
2020. These increases in revenue from pool and recreation program revenue were offset by reciprocal
increases in culture and recreation expense. In addition, the City increased general property taxes. General
government expenses had increased in the 2020, primarily as a result of a loss on the disposal of the old
City Hall building and improvements. In 2021, a change in the City’s pension liability resulted in
decreased public safety expense.
-9-
Governmental Activities – Governmental activities net position increased by $8,193,901. 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
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 $2,840,485. This
increase was primarily the result of operating net income in the Sewer Utility, Water Utility, and Storm
Water Funds of $1,038,266, $868,709, and $431,217, 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 $30,054,786, an increase of $2,599,535 in comparison with the prior year. Approximately
22.1 percent of this total amount, $6,646,030, 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 ($49,680),
2) restricted ($9,779,064), 3) committed ($4,520,972), or 4) assigned ($9,059,040).
General Fund – The fund balance of the General Fund decreased by $252,343 to $8,673,743 at
December 31, 2021. Unassigned fund balance represents 51.2 percent of total 2021 expenditures. The
decrease in fund balance was due to transferring out $1,641,664 of excess fund balance accumulated in
the prior year to provide internal financing for planned capital improvements. Fund balance was also
influenced by the opening of the aquatic facility, with resulting increases in both service charge revenue
and operating expenditures. Changes in post-employment benefit liability costs for the police department,
as well as position vacancies, resulted in a decrease in expenditures.
Economic Development Authority – Fund balance decreased by $107,977 in 2021, due to economic
development expenditures exceeding revenues in the current year. The year-end fund balance of
$4,212,479 is 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 $576,048, which is primarily result of increased in tax increment
revenues from improvements.
Street Infrastructure – This fund accounts for capital outlay expenditures related to street infrastructure.
Fund balance increased $905,670 from the prior year. The increase was a result of revenues exceeding
current year project costs.
HRA Bonds – The increase in fund balance of $141,769 is primarily related to tax increment revenues
exceeding debt service requirements and other expenditures in the fund. The year-end fund balance deficit
of $1,978,033 is expected to be eliminated through future tax increment revenues.
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 $29,560,306 at year-end, of which $6,953,260 was
unrestricted. The total net position of these funds improved by $3,080,923 during 2021. The primary
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 both
provided positive budget variances. Actual revenues were over budget by $649,775 and expenditures
were under budget by $733,618.
Revenue line items with significant budget variances include the following:
•Intergovernmental revenue was over budget by $1,113,189, due to federal funding allocated to
the City through the American Recovery Plan Act (ARPA) that was utilized in the current year.
•Charges for services revenue was under budget by $325,558, mainly due the City’s new outdoor
pool facility, which generated less revenue than projected in its first year of operation.
•Investment earnings were $143,405 under budget, due to market conditions and available interest
rates not performing up to expectations.
Expenditure line items with significant budget variances include the following:
•Public safety expenditures were under budget by $529,627, mostly in personnel services for the
police department, due to vacant positions.
•Culture and recreation expenditures were under budget by $288,598, primarily in the swimming
pool area, which contributed $202,869 of the variance, due to lower than anticipated first year
operating costs.
-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, 2021 was $104,316,788, an increase of
$1,646,378 from the prior year. The City’s capital assets for the last two years are as follows:
2021 2020 2021 2020 2021 2020
Land 994,268$ 994,268$ 485,042$ 485,042$ 1,479,310$ 1,479,310$
Buildings and structures 25,408,669 25,408,669 10,797,364 10,797,364 36,206,033 36,206,033
Vehicles and equipment 11,383,148 10,531,390 3,065,892 2,505,156 14,449,040 13,036,546
Improvements other than buildings 47,294,718 47,227,137 28,992,200 28,522,699 76,286,918 75,749,836
Construction in progress 23,726,228 19,939,298 1,598,507 1,370,824 25,324,735 21,310,122
Less accumulated
depreciation (34,095,621) (30,766,852) (15,333,627) (14,344,585) (49,429,248) (45,111,437)
Net total 74,711,410$ 73,333,910$ 29,605,378$ 29,336,500$ 104,316,788$ 102,670,410$
Governmental Activities Business-Type Activities Total
The majority of the increase in capital assets was in construction in progress, with significant projects
including 2021 street infrastructure improvements and an addition to the City’s public works facility.
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
$3,093,625 of fund balance restricted for debt service in the governmental funds. The G.O. revenue bonds
will be paid from the designated business activity from Ice Arena, Sewer Utility, Water Utility, and Storm
Water Funds. The following table presents the City’s bonded debt as of the last two year-ends:
2021 2020 2021 2020 2021 2020
G.O. bonds and certificates 36,866,522$ 38,930,476$ 4,897,991$ 3,285,833$ 41,764,513$ 42,216,309$
G.O. tax increment bonds 5,354,862 6,005,590 1,210,406 1,307,253 6,565,268 7,312,843
Lease revenue bonds – – – 3,505,000 – 3,505,000
G.O. revenue bonds and notes – – 889,935 1,111,126 889,935 1,111,126
Total 42,221,384$ 44,936,066$ 6,998,332$ 9,209,212$ 49,219,716$ 54,145,278$
TotalGovernmental Activities Business-Type Activities
The City also acquired three police vehicles valued at $114,728, through a capital lease agreement during
the year. The outstanding lease payable balance was $112,376 at year-end.
The City maintained an “AA” rating on its debt 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 2022 budget:
•User charges have been increased to account for various utility improvements scheduled for 2022
and beyond.
•The tax levy increased by 4.67 percent for 2022. This includes a new Housing and
Redevelopment Authority (HRA) levy of $417,000 and a reduction in the Economic
Development Authority (EDA) levy to $153,000 (down from $365,000 in 2021).
•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.
•In 2021, the City received $1,142,382 of American Rescue Plan Act (ARPA) funds to help
address expenses related to the COVID-19 pandemic. The City will receive the second allotment
of ARPA funds in 2022 and continues to respond to the pandemic in a measured and
forward-thinking manner, balancing increased costs and lost revenue with reductions in spending
on programming.
REQUESTS FOR INFORMATION
This financial report is designed to provide a general overview of the City’s finances for all those with an
interest in the City’s finances. Questions concerning any of the information provided in this report or
requests for additional financial information should be addressed to the Department of Finance, City of
New Hope, 4401 Xylon Avenue North, New Hope, Minnesota 55428.
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GOVERNMENT-WIDE FINANCIAL STATEMENTS
CITY OF NEW HOPE, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2021
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Governmental Business-Type
Activities Activities Total
Assets
Cash and temporary investments 41,032,970$ 6,935,751$ 47,968,721$
Receivables
Taxes 254,365 – 254,365
Accrued interest 16,031 – 16,031
Accounts 327,373 1,450,130 1,777,503
Loans 255,534 – 255,534
Special assessments 498,649 178,253 676,902
Internal balances 692,123 (692,123) –
Due from other governments 1,278,535 206,415 1,484,950
Inventories 64,202 35,397 99,599
Prepaid items 49,680 – 49,680
Investment in joint ventures 974,626 168,509 1,143,135
Capital assets
Land and construction in progress 24,720,496 2,083,549 26,804,045
Depreciable assets (net of accumulated deprecation)49,990,914 27,521,829 77,512,743
Total assets 120,155,498 37,887,710 158,043,208
Deferred outflows of resources
Deferred pension resources 5,190,055 492,108 5,682,163
Liabilities
Accrued salaries payable 469,730 60,583 530,313
Accounts and contracts payable 1,016,734 421,204 1,437,938
Due to other governments 26,202 386,430 412,632
Accrued interest payable 590,365 56,864 647,229
Deposits payable 6,518 2,206 8,724
Unearned revenue 13,800 – 13,800
Noncurrent liabilities
Due within one year 2,757,716 715,475 3,473,191
Due in more than one year 40,451,133 6,282,857 46,733,990
Net pension liability – due in more than one year 4,051,787 670,982 4,722,769
OPEB liability – due in more than one year 799,276 104,259 903,535
Total liabilities 50,183,261 8,700,860 58,884,121
Deferred inflows of resources
Deferred pension resources 7,372,502 616,712 7,989,214
Resources received in advance 778,521 – 778,521
Total deferred inflows of resources 8,151,023 616,712 8,767,735
Net position
Net investment in capital assets 34,985,781 22,607,046 57,592,827
Restricted for
Economic development 5,955,136 – 5,955,136
Debt service 2,503,260 – 2,503,260
Public safety police expenses 134,455 – 134,455
Ice arena 5,460 – 5,460
Unrestricted 23,427,177 6,455,200 29,882,377
Total net position 67,011,269$ 29,062,246$ 96,073,515$
December 31, 2021
CITY OF NEW HOPE
Statement of Net Position
See notes to basic financial statements -15-
Operating Capital
Charges for Grants and Grants and
Expenses Services Contributions Contributions
Governmental activities
General government 1,152,633$ 270,287$ 460,284$ 2,326$
Public safety 7,764,051 832,767 390,343 –
Public works 4,295,427 235,879 213,954 710,249
Culture and recreation 3,095,760 996,447 29,179 8,124
Economic development 1,434,986 – – –
Interest on long-term debt 1,518,351 – – –
Total governmental activities 19,261,208 2,335,380 1,093,760 720,699
Business-type activities
Sewer utility 2,973,301 3,906,809 475 –
Water utility 4,813,286 5,882,735 16,966 13,475
Golf course 368,659 473,508 89 –
Ice arena 1,095,343 925,967 4,721 –
Storm water 991,031 1,321,518 124,504 –
Street lighting 135,899 170,656 – –
Total business-type activities 10,377,519 12,681,193 146,755 13,475
Total 29,638,727$ 15,016,573$ 1,240,515$ 734,174$
General revenues
Taxes
Property taxes
Tax increments
Franchise taxes
Grants and contributions not restricted
to specific programs
Unrestricted investment earnings (charges)
Gain on sale of capital assets
Transfers – internal activities
Total general revenues and transfer
Change in net position
Net position, January 1
Net position, December 31
Functions/Programs
Program Revenues
CITY OF NEW HOPE
Statement of Activities
Year Ended December 31, 2021
See notes to basic financial statements -16-
Governmental Business-Type
Activities Activities Total
(419,736)$ –$ (419,736)$
(6,540,941) – (6,540,941)
(3,135,345) – (3,135,345)
(2,062,010) – (2,062,010)
(1,434,986) – (1,434,986)
(1,518,351) – (1,518,351)
(15,111,369) – (15,111,369)
– 933,983 933,983
– 1,099,890 1,099,890
– 104,938 104,938
– (164,655) (164,655)
– 454,991 454,991
– 34,757 34,757
– 2,463,904 2,463,904
(15,111,369) 2,463,904 (12,647,465)
17,357,910 – 17,357,910
2,118,199 – 2,118,199
962,395 – 962,395
3,155,397 – 3,155,397
(22,179) 39,829 17,650
70,300 – 70,300
(336,752) 336,752 –
23,305,270 376,581 23,681,851
8,193,901 2,840,485 11,034,386
58,817,368 26,221,761 85,039,129
67,011,269$ 29,062,246$ 96,073,515$
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, 2021
9001 9015/9501 9213-9228 9203
Economic
Development HRA Street
General Authority Construction Infrastructure
Assets
Cash and temporary investments 8,384,004$ 2,187,136$ 5,373,618$ 2,607,963$
Receivables
Taxes 246,519 – 3,190 –
Accrued interest 16,031 – – –
Accounts 286,468 7,112 – –
Loans – 237,500 – –
Special assessments 47,291 1,538 – 394,805
Due from other governments 1,224,691 – – 53,844
Prepaid items 49,680 – – –
Due from other funds 194,063 2,626 – –
Advances to other funds – 1,791,920 2,019,009 –
Total assets 10,448,747$ 4,227,832$ 7,395,817$ 3,056,612$
Liabilities
Accrued salaries payable 305,579$ 10,761$ –$ –$
Accounts and contracts payable 127,538 2,593 – 351,920
Due to other governments 25,068 461 – –
Deposits payable 6,518 – – –
Due to other funds – – 2,626 75,000
Advances from other funds – – 1,438,055 300,000
Unearned revenue – – – –
Total liabilities 464,703 13,815 1,440,681 726,920
Deferred inflows of resources
Unavailable revenue – taxes 120,628 – – –
Unavailable revenue – special assessments 47,291 1,538 – 394,804
Unavailable revenue – long-term receivables 1,142,382 – – –
Resources received in advance – – – 778,521
Total deferred inflows of resources 1,310,301 1,538 – 1,173,325
Fund balances (deficit)
Nonspendable 49,680 – – –
Restricted – – 5,955,136 –
Committed – 4,212,479 – –
Assigned – –– 1,156,367
Unassigned 8,624,063 – – –
Total fund balances (deficit)8,673,743 4,212,479 5,955,136 1,156,367
Total liabilities, deferred inflows
of resources, and fund balances 10,448,747$ 4,227,832$ 7,395,817$ 3,056,612$
CITY OF NEW HOPE
Balance Sheet
Governmental Funds
December 31, 2021
See notes to basic financial statements -18-
9117-9121
Other Total
Governmental Governmental
HRA Bonds Funds Funds
390,185$ 12,088,576$ 31,031,482$
4,656 – 254,365
– – 16,031
– 24,000 317,580
– 18,034 255,534
– 55,015 498,649
– –1,278,535
– –49,680
– 75,000 271,689
– 300,000 4,110,929
394,841$ 12,560,625$ 38,084,474$
–$ –$ 316,340$
– 463,286 945,337
– –25,529
– –6,518
– –77,626
2,372,874 – 4,110,929
– 13,800 13,800
2,372,874 477,086 5,496,079
– – 120,628
– 48,445 492,078
– –1,142,382
– –778,521
– 48,445 2,533,609
– – 49,680
– 3,823,928 9,779,064
– 308,493 4,520,972
– 7,902,673 9,059,040
(1,978,033) – 6,646,030
(1,978,033) 12,035,094 30,054,786
394,841$ 12,560,625$ 38,084,474$
-19-
THIS PAGE INTENTIONALLY LEFT BLANK
Total fund balances – governmental funds 30,054,786$
Amounts reported for the governmental activities in the statement of net position are different because:
Cost of capital assets 94,940,235
Less accumulated depreciation (23,493,313)
Bonds payable (39,797,395)
Plus unamortized bond premiums (2,423,989)
Net pension liability (3,892,030)
Internal service fund net position included in governmental activities 11,138,346
Internal balances for internal services used by business-type activities 498,060
Taxes 120,628
Special assessments 492,078
Long-term receivables 1,142,382
Deferred outflows of pension resources 5,072,886
Deferred inflows of pension resources (7,225,666)
(590,365)
974,626
Total net position – governmental activities 67,011,269$
CITY OF NEW HOPE
Reconciliation of the Balance Sheet
to the Statement of Net Position
Governmental Funds
December 31, 2021
Capital assets used in governmental activities are not financial resources and, therefore, are not
reported as assets in governmental funds.
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.
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.
Governmental funds do not report long-term amounts related to pensions.
Governmental funds do not report a liability for accrued interest until due and payable.
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.
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:
See notes to basic financial statements -20-
9001 9015/9501 9213-9228 9203
Economic
Development HRA Street
General Authority Construction Infrastructure
Revenues
Taxes
Property taxes 10,914,572$ 365,000$ –$ 1,540,700$
Tax increments – – 1,357,465 –
Franchise taxes 522,395 – – 440,000
Licenses and permits 399,087 – – –
Intergovernmental 2,603,365 – – 641,860
Charges for services 1,491,327 – – –
Fines and forfeitures 185,603 – – –
Special assessments 32,210 1,636 – 100,285
Investment earnings (charges)(93,405) 60,675 162,114 (17,879)
Miscellaneous 80,922 100,392 – –
Total revenues 16,136,076 527,703 1,519,579 2,704,966
Expenditures
Current
General government 2,148,125 – – –
Public safety 8,591,161 – – –
Public works 1,653,003 – – –
Culture and recreation 2,629,453 – – –
Economic development – 599,176 669,437 66,352
Capital outlay
General government – – – –
Public safety 181,616 – – –
Public works – – – 1,722,264
Culture and recreation – – – –
Economic development – – 120,948 –
Debt service
Principal – – – –
Interest and fiscal charges – – 153,146 10,680
Total expenditures 15,203,358 599,176 943,531 1,799,296
Excess (deficiency) of
revenues over expenditures 932,718 (71,473) 576,048 905,670
Other financing sources (uses)
Sale of capital assets 6,800 – – –
Transfers in 450,672 – – –
Transfers out (1,642,533) (36,504) – –
Total other financing sources (uses)(1,185,061) (36,504) – –
Net change in fund balances (252,343) (107,977) 576,048 905,670
Fund balances (deficit), January 1 8,926,086 4,320,456 5,379,088 250,697
Fund balances (deficit), December 31 8,673,743$ 4,212,479$ 5,955,136$ 1,156,367$
CITY OF NEW HOPE
For the Year Ended December 31, 2021
Governmental Funds
Statement of Revenues, Expenditures and Changes in Fund Balances
See notes to basic financial statements -21-
9117-9121
Other Total
Governmental Governmental
HRA Bonds Funds Funds
–$ 4,632,436$ 17,452,708$
760,734 – 2,118,199
– – 962,395
– – 399,087
– 8,124 3,253,349
– 286,853 1,778,180
– –185,603
– 8,282 142,413
– (76,541) 34,964
– 4,250 185,564
760,734 4,863,404 26,512,462
– – 2,148,125
– – 8,591,161
– 244,267 1,897,270
– –2,629,453
2,560 – 1,337,525
– 212,151 212,151
– –181,616
– 1,936,426 3,658,690
– 439,210 439,210
– –120,948
428,843 2,120,042 2,548,885
187,562 1,367,473 1,718,861
618,965 6,319,569 25,483,895
141,769 (1,456,165) 1,028,567
– – 6,800
– 5,334,197 5,784,869
– (2,541,664) (4,220,701)
– 2,792,533 1,570,968
141,769 1,336,368 2,599,535
(2,119,802) 10,698,726 27,455,251
(1,978,033)$ 12,035,094$ 30,054,786$
-22-
THIS PAGE INTENTIONALLY LEFT BLANK
Net change in fund balances – governmental funds 2,599,535$
Amounts reported for governmental activities in the statement of activities are different because:
Capital outlays 3,846,952
Depreciation expense (2,890,736)
Change in investment in joint venture 338,025
Principal repayments 2,548,885
Amortization of bond premium 165,797
34,746
Property taxes (94,798)
Special assessments (74,024)
Long-term receivables 1,142,382
Pension expense 921,533
Direct aid contributions 43,810
Change in net position of the internal service funds (628,644)
Less the change in internal balances for internal services used by business-type activities 240,438
Change in net position – governmental activities 8,193,901$
CITY OF NEW HOPE
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.
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.
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, 2021
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.
Long-term pension activity is not reported in governmental funds.
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.
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.
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.
See notes to basic financial statements -23-
Actual Over (Under)
Original Final Amounts Budget
Revenues
Taxes
Property taxes 10,880,965$ 10,880,965$ 10,914,572$ 33,607$
Franchise taxes 535,000 535,000 522,395 (12,605)
Licenses and permits 450,575 450,575 399,087 (51,488)
Intergovernmental 1,490,176 1,490,176 2,603,365 1,113,189
Charges for services 1,816,885 1,816,885 1,491,327 (325,558)
Fines and forfeitures 220,000 220,000 185,603 (34,397)
Special assessments 40,000 40,000 32,210 (7,790)
Investment earnings (charges)50,000 50,000 (93,405) (143,405)
Miscellaneous 2,700 2,700 80,922 78,222
Total revenues 15,486,301 15,486,301 16,136,076 649,775
Expenditures
Current
General government 2,056,129 2,056,129 2,148,125 91,996
Public safety 9,138,404 9,138,404 8,591,161 (547,243)
Public works 1,655,392 1,655,392 1,653,003 (2,389)
Culture and recreation 2,915,551 2,915,551 2,629,453 (286,098)
Capital outlay
General government 5,000 5,000 – (5,000)
Public safety 164,000 164,000 181,616 17,616
Culture and recreation 2,500 2,500 – (2,500)
Total expenditures 15,936,976 15,936,976 15,203,358 (733,618)
Excess (deficiency) of
revenues over expenditures (450,675) (450,675) 932,718 1,383,393
Other financing sources (uses)
Sale of capital assets – – 6,800 6,800
Transfers in 450,675 450,675 450,672 (3)
Transfers out – – (1,642,533) (1,642,533)
Total other financing sources (uses)450,675 450,675 (1,185,061) (1,635,736)
Net change in fund balances – – (252,343) (252,343)
Fund balances, January 1 8,926,086 8,926,086 8,926,086 –
Fund balances, December 31 8,926,086$ 8,926,086$ 8,673,743$ (252,343)$
Budgeted Amounts
Statement of Revenues, Expenditures, and Changes in Fund Balances –
CITY OF NEW HOPE
General Fund
Budget and Actual
For the Year Ended December 31, 2021
See notes to basic financial statements -24-
Actual Over (Under)
Original Final Amounts Budget
Revenues
Taxes
Property taxes 365,000$ 365,000$ 365,000$ –$
Intergovernmental 107,000 107,000 – (107,000)
Special assessments 1,600 1,600 1,636 36
Investment earnings 76,000 76,000 60,675 (15,325)
Miscellaneous – – 100,392 100,392
Total revenues 549,600 549,600 527,703 (21,897)
Expenditures
Current
Economic development
Personnel services 342,338 342,338 344,901 2,563
Supplies 300 300 369 69
Other services and charges 398,570 398,570 253,906 (144,664)
Total expenditures 741,208 741,208 599,176 (142,032)
Excess (deficiency) of
revenues over expenditures (191,608) (191,608) (71,473) 120,135
Other financing sources (uses)
Transfers out (36,509) (36,509) (36,504) 5
Net change in fund balances (228,117) (228,117) (107,977) 120,140
Fund balances, January 1 4,320,456 4,320,456 4,320,456 –
Fund balances, December 31 4,092,339$ 4,092,339$ 4,212,479$ 120,140$
Budgeted Amounts
CITY OF NEW HOPE
Economic Development Authority Fund
Statement of Revenues, Expenditures, and Changes in Fund Balances –
Budget and Actual
For the Year Ended December 31, 2021
See notes to basic financial statements -25-
9300 9301 9302 9303
Sewer Utility Water Utility Golf Course Ice Arena
Assets
Current assets
Cash and temporary investments 2,070,556$ 3,154,081$ 341,554$ –$
Receivables
Accounts 374,800 909,065 2,923 20,883
Special assessments 49,907 112,423 – –
Due from other governments – 75,361 – 84,351
Inventories – 28,511 6,886 –
Total current assets 2,495,263 4,279,441 351,363 105,234
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 1,392,767 133,696 931,954
Improvements other than buildings 6,628,754 11,792,638 140,620 –
Construction in progress 710,107 474,234 – –
Less accumulated depreciation (3,229,105) (4,520,096) (1,074,356) (4,446,281)
Total capital assets
(net of accumulated depreciation)4,717,231 9,139,543 423,730 6,309,892
Total noncurrent assets 4,717,231 9,308,052 423,730 6,309,892
Total assets 7,212,494 13,587,493 775,093 6,415,126
Deferred outflows of resources
Deferred pension resources 141,410 133,734 26,463 119,190
Business-Type Activities – Enterprise Funds
CITY OF NEW HOPE
Statement of Net Position
Proprietary Funds
December 31, 2021
See notes to basic financial statements -26-
Governmental
Activities –
9304 9305 Internal
Storm Water Street Lighting Totals Service Funds
Assets
Current assets
Cash and temporary investments 1,240,598$ 128,962$ 6,935,751$ 10,001,488$
Receivables
Accounts 134,809 7,650 1,450,130 9,793
Special assessments 13,854 2,069 178,253 –
Due from other governments 46,703 – 206,415 –
Inventories – – 35,397 64,202
Total current assets 1,435,964 138,681 8,805,946 10,075,483
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 – – 3,065,892 10,615,294
Improvements other than buildings 10,040,483 389,705 28,992,200 –
Construction in progress 414,166 – 1,598,507 7,559
Less accumulated depreciation (2,024,818) (38,971) (15,333,627) (10,602,308)
Total capital assets
(net of accumulated depreciation)8,664,248 350,734 29,605,378 3,264,488
Total noncurrent assets 8,664,248 350,734 29,773,887 3,264,488
Total assets 10,100,212 489,415 38,579,833 13,339,971
Deferred outflows of resources
Deferred pension resources 71,311 – 492,108 117,169
Business-Type Activities – Enterprise Funds
CITY OF NEW HOPE
Statement of Net Position (continued)
Proprietary Funds
December 31, 2021
-27-(continued)
9300 9301 9302 9303
Sewer Utility Water Utility Golf Course Ice Arena
Liabilities
Current liabilities
Accrued salaries payable 13,753$ 22,186$ 2,383$ 16,827$
Accounts and contracts payable 215,699 85,189 9,160 44,845
Due to other governments 287 372,968 164 12,732
Accrued interest payable 8,318 28,487 – 4,500
Due to other funds – – – 194,063
Deposits payable – 2,206 – –
Compensated absences payable, current portion – –– –
Leases payable, current portion – –– –
Bonds and notes payable, current portion 59,207 248,118 – 245,000
Total current liabilities 297,264 759,154 11,707 517,967
Noncurrent liabilities
OPEB payable 10,583 58,757 3,654 21,988
Pension liability 192,811 182,344 36,083 162,512
Compensated absences payable – – – –
Leases payable – – – –
Bonds and notes payable 680,641 2,714,013 – 1,555,000
Unamortized premium 17,807 71,868 – 39,983
Total noncurrent liabilities 901,842 3,026,982 39,737 1,779,483
Total liabilities 1,199,106 3,786,136 51,444 2,297,450
Deferred inflows of resources
Deferred pension resources 177,216 167,596 33,164 149,368
Net position
Net investment in capital assets 3,959,576 6,105,544 423,730 4,469,909
Unrestricted 2,018,006 3,661,951 293,218 (382,411)
Total net position 5,977,582$ 9,767,495$ 716,948$ 4,087,498$
Proprietary Funds
December 31, 2021
Business-Type Activities – Enterprise Funds
CITY OF NEW HOPE
Statement of Net Position (continued)
See notes to basic financial statements -28-
Governmental
Activities –
9304 9305 Internal
Storm Water Street Lighting Totals Service Funds
Liabilities
Current liabilities
Accrued salaries payable 5,434$ –$ 60,583$ 153,390$
Accounts and contracts payable 51,341 14,970 421,204 71,397
Due to other governments 279 – 386,430 673
Accrued interest payable 15,559 – 56,864 –
Due to other funds – – 194,063 –
Deposits payable – – 2,206 –
Compensated absences payable, current portion – – – 87,509
Leases payable, current portion – – – 28,682
Bonds and notes payable, current portion 163,150 – 715,475 –
Total current liabilities 235,763 14,970 1,836,825 341,651
Noncurrent liabilities
OPEB payable 9,277 – 104,259 799,276
Pension liability 97,232 – 670,982 159,757
Compensated absences payable – – – 787,580
Leases payable – – – 83,694
Bonds and notes payable 1,165,476 – 6,115,130 –
Unamortized premium 38,069 – 167,727 –
Total noncurrent liabilities 1,310,054 – 7,058,098 1,830,307
Total liabilities 1,545,817 14,970 8,894,923 2,171,958
Deferred inflows of resources
Deferred pension resources 89,368 – 616,712 146,836
Net position
Net investment in capital assets 7,297,553 350,734 22,607,046 3,152,112
Unrestricted 1,238,785 123,711 6,953,260 7,986,234
Total net position 8,536,338$ 474,445$ 29,560,306$ 11,138,346$
Total net position – enterprise funds 29,560,306$
Adjustment to reflect the consolidation of internal service fund
(498,060)
Net position – business-type activities 29,062,246$
Business-Type Activities – Enterprise Funds
CITY OF NEW HOPE
Statement of Net Position (continued)
Proprietary Funds
December 31, 2021
-29-
9300 9301 9302 9303
Sewer Utility Water Utility Golf Course Ice Arena
Operating revenues
Charges for services 3,906,809$ 5,545,731$ 450,307$ 883,968$
Billings to departments – – – –
Other – – – –
Total operating revenues 3,906,809 5,545,731 450,307 883,968
Operating expenses
Cost of goods sold 1,967,078 3,308,537 31,227 –
Personnel services 270,338 516,709 140,385 387,404
Supplies 15,785 106,563 31,346 26,647
Utilities 13,612 689 29,834 239,209
Other services and charges 414,762 447,363 88,192 204,423
Depreciation 186,968 297,161 37,298 202,133
Total operating expenses 2,868,543 4,677,022 358,282 1,059,816
Operating income (loss)1,038,266 868,709 92,025 (175,848)
Nonoperating revenues (expenses)
Investment earnings (charges)(15,737) (21,295) (3,016) 91,194
Miscellaneous revenues 475 353,970 23,290 46,720
Intergovernmental – – – –
Gain on sale of capital assets – – – –
Interest expense (18,883) (66,078) – (26,725)
Total nonoperating revenues (expenses)(34,145) 266,597 20,274 111,189
Income (loss) before contributions and transfers 1,004,121 1,135,306 112,299 (64,659)
Capital contributions – 13,475 – –
Transfers in – –– 500,000
Transfers out (56,952) (59,388) (11,040) (11,040)
Change in net position 947,169 1,089,393 101,259 424,301
Net position, January 1 5,030,413 8,678,102 615,689 3,663,197
Net position, December 31 5,977,582$ 9,767,495$ 716,948$ 4,087,498$
Business-Type Activities – Enterprise Funds
CITY OF NEW HOPE
Statement of Revenues, Expenses and
Changes in Net Position
Proprietary Funds
For the Year Ended December 31, 2021
See notes to basic financial statements -30-
CITY OF NEW HOPE
Governmental
Activities –
9304 9305 Internal
Storm Water Street Lighting Totals Service Funds
Operating revenues
Charges for services 1,321,518$ 170,656$ 12,278,989$ –$
Billings to departments – – – 3,921,506
Other – – – 248,872
Total operating revenues 1,321,518 170,656 12,278,989 4,170,378
Operating expenses
Cost of goods sold – – 5,306,842 –
Personnel services 157,325 – 1,472,161 866,377
Supplies 7,235 – 187,576 269,728
Utilities – 108,935 392,279 121,831
Other services and charges 479,745 7,691 1,642,176 1,074,676
Depreciation 245,996 19,486 989,042 571,814
Total operating expenses 890,301 136,112 9,990,076 2,904,426
Operating income (loss)431,217 34,544 2,288,913 1,265,952
Nonoperating revenues (expenses)
Investment earnings (10,264) (1,053) 39,829 (57,143)
Miscellaneous revenues 240 – 424,695 –
Intergovernmental 124,264 – 124,264 –
Gain (loss) on sale of capital assets – – – 63,500
Interest expense (35,319) – (147,005) (33)
Total nonoperating revenues (expenses)78,921 (1,053) 441,783 6,324
Income (loss) before contributions and transfers 510,138 33,491 2,730,696 1,272,276
Capital contributions – – 13,475 –
Transfers in – – 500,000 –
Transfers out (24,828) – (163,248) (1,900,920)
Change in net position 485,310 33,491 3,080,923 (628,644)
Net position, January 1 8,051,028 440,954 26,479,383 11,766,990
Net position, December 31 8,536,338$ 474,445$ 29,560,306$ 11,138,346$
Change in net position – enterprise funds 3,080,923$
Adjustment to reflect the consolidation of internal service
fund activities related to the enterprise funds.(240,438)
Change in net position – business-type activities 2,840,485$
Business-Type Activities - Enterprise Funds
Statement of Revenues, Expenses and
Changes in Net Position (continued)
Proprietary Funds
For the Year Ended December 31, 2021
-31-
9300 9301 9302 9303
Sewer Utility Water Utility Golf Course Ice Arena
Cash flows from operating activities
Receipts from customers and users 3,877,375$ 5,498,736$ 451,739$ 877,114$
Receipts from interfund services provided – – – –
Other operating receipts 475 353,970 23,290 46,720
Payments to suppliers (2,378,571) (4,007,497) (178,354) (455,824)
Payments to employees (416,232) (422,494) (144,262) (404,975)
Net cash from operating activities 1,083,047 1,422,715 152,413 63,035
Cash flows from noncapital financing activities
Receipts on interfund balances – – – 194,063
Payments on interfund balances – – – (156,685)
Transfers in – – – 500,000
Transfers out (56,952) (59,388) (11,040) (11,040)
Net cash from noncapital financing activities (56,952) (59,388) (11,040) 526,338
Cash flows from capital and related financing activities
Acquisition of capital assets (262,040) (147,614) (11,348) (549,388)
Proceeds from sale of assets – – – –
Capital contributions – 13,475 – –
Proceeds from issuance of long-term debt – –– 2,064,747
Principal paid on long-term debt (57,500) (324,781) – (3,725,000)
Interest paid on long-term debt (20,665) (74,401) – (31,779)
Net cash from capital and
related financing activities (340,205) (533,321) (11,348) (2,241,420)
Cash flows from investing activities
Investment earnings (charges)(15,737) (21,295) (3,016) 91,194
Net increase (decrease) in cash
and cash equivalents 670,153 808,711 127,009 (1,560,853)
Cash and cash equivalents, January 1 1,400,403 2,345,370 214,545 1,560,853
Cash and cash equivalents, December 31 2,070,556$ 3,154,081$ 341,554$ –$
Business-Type Activities – Enterprise Funds
For the Year Ended December 31, 2021
Proprietary Funds
Statement of Cash Flows
CITY OF NEW HOPE
See notes to basic financial statements -32-
Governmental
Activities –
9304 9305 Internal
Storm Water Street Lighting Totals Service Funds
Cash flows from operating activities
Receipts from customers and users 1,258,467$ 170,126$ 12,133,557$ –$
Receipts from interfund services provided – – – 3,919,154
Other operating receipts 124,504 – 548,959 248,872
Payments to suppliers (447,908) (111,065) (7,579,219) (1,517,901)
Payments to employees (201,833) – (1,589,796) (1,038,153)
Net cash from operating activities 733,230 59,061 3,513,501 1,611,972
Cash flows from noncapital financing activities
Receipts on interfund balances – – 194,063 –
Payments on interfund balances – – (156,685) –
Transfers in – – 500,000 –
Transfers out (24,828) – (163,248) (1,900,920)
Net cash from noncapital financing activities (24,828) – 374,130 (1,900,920)
Cash flows from capital and related financing activities
Acquisition of capital assets (287,530) – (1,257,920) (878,370)
Proceeds from sale of assets – – – 63,500
Capital contributions – – 13,475 –
Proceeds from issuance of long-term debt – – 2,064,747 –
Principal paid on long-term debt (154,834) – (4,262,115) (2,352)
Interest paid on long-term debt (39,739) – (166,584) (33)
Net cash from capital and
related financing activities (482,103) – (3,608,397) (817,255)
Cash flows from investing activities
Investment earnings (10,264) (1,053) 39,829 (57,143)
Net increase (decrease) in cash
and cash equivalents 216,035 58,008 319,063 (1,163,346)
Cash and cash equivalents, January 1 1,024,563 70,954 6,616,688 11,164,834
Cash and cash equivalents, December 31 1,240,598$ 128,962$ 6,935,751$ 10,001,488$
Business-Type Activities – Enterprise Funds
CITY OF NEW HOPE
Statement of Cash Flows (continued)
Proprietary Funds
For the Year Ended December 31, 2021
-33-(continued)
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)1,038,266$ 868,709$ 92,025$ (175,848)$
Adjustments to reconcile operating income (loss)
to net cash from operating activities
Depreciation 186,968 297,161 37,298 202,133
Other income related to operations 475 353,970 23,290 46,720
(Increase) decrease in assets
Receivables
Accounts (33,138) 19,847 1,432 17,413
Special assessments 3,704 8,519 – –
Due from other governments – (75,361) – (24,267)
Inventories – 9,465 (2,370) –
(Increase) decrease in deferred outflows of resources
Deferred pension resources (105,048) (115,837) (21,026) (93,904)
Deferred OPEB resources 11,851 4,941 699 4,048
Increase (decrease) in liabilities
Accounts and contracts payable 32,379 7,028 4,638 5,706
Accrued salaries payable 275 2,124 240 5,824
Due to other governments 287 (160,838) (23) 8,749
Compensated absences payable – – – –
OPEB payable (67,761) 22,385 (2,876) (17,435)
Pension liability (146,474) 20,583 (11,957) (55,546)
Increase (decrease) in deferred inflows of resources
Deferred pension resources 163,606 161,521 31,256 140,672
Deferred other postemployment benefit resources (2,343) (1,502) (213) (1,230)
Net cash from operating activities 1,083,047$ 1,422,715$ 152,413$ 63,035$
Schedule of noncash capital and related financing activities
Amortization of bond premium 1,198$ 4,929$ –$ 4,764$
Capital assets acquired through leases payable –$ –$ –$ –$
Business-Type Activities – Enterprise Funds
CITY OF NEW HOPE
Statement of Cash Flows (continued)
Proprietary Funds
For the Year Ended December 31, 2021
See notes to basic financial statements -34-
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)431,217$ 34,544$ 2,288,913$ 1,265,952$
Adjustments to reconcile operating income (loss)
to net cash from operating activities
Depreciation 245,996 19,486 989,042 571,814
Other income related to operations 124,504 – 548,959 –
(Increase) decrease in assets
Receivables
Accounts (17,849) (763) (13,058) (2,352)
Special assessments 1,501 233 13,957 –
Due from other governments (46,703) – (146,331) –
Inventories – – 7,095 3,833
(Increase) decrease in deferred outflows of resources
Deferred pension resources (59,265) – (395,080) (93,397)
Deferred OPEB resources 8,935 – 30,474 167,973
Increase (decrease) in liabilities
Accounts and contracts payable 38,793 5,561 94,105 (55,541)
Accrued salaries payable 1,494 – 9,957 (9,478)
Due to other governments 279 – (151,546) 42
Compensated absences payable – – – 31,633
OPEB payable (18,273) – (83,960) (311,187)
Pension liability (59,650) – (253,044) (62,055)
Increase (decrease) in deferred inflows of resources
Deferred pension resources 84,967 – 582,022 137,938
Deferred OPEB resources (2,716) – (8,004) (33,203)
Net cash from operating activities 733,230$ 59,061$ 3,513,501$ 1,611,972$
Schedule of noncash capital and related financing activities
Amortization of bond premium 2,621$ –$ 9,351$ –$
Capital assets contributed to governmental activities –$ –$ –$ 114,728$
Business-Type Activities – Enterprise Funds
CITY OF NEW HOPE
Statement of Cash Flows (continued)
Proprietary Funds
For the Year Ended December 31, 2021
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THIS PAGE INTENTIONALLY LEFT BLANK
CITY OF NEW HOPE
Notes to Basic Financial Statements
December 31, 2021
-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.
Street Infrastructure Capital Projects Fund – This fund is used to account for various street projects
within the City.
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.
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.
-39-
NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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 2021, expenditures exceeded budget in the (nonmajor)
Solid Waste Management Special Revenue Fund by $12.
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.
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.
-40-
NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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, 2021, the total
delinquent special assessment receivable balance was $43,145.
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.
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.”
-41-
NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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.
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 three sources: property taxes, special assessments, and long-term
receivables. 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.
-42-
NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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 healthcare 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, 2021. 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.
Net investment in capital assets at year-end is calculated as follows:
Governmental Business-Type
Activities Activities Total
Capital assets, net of depreciation 74,711,410$ 29,605,378$ 104,316,788$
Less applicable
Bonds payable (37,802,395) (6,830,605) (44,633,000)
Unamortized bond premiums (2,401,246) (167,727) (2,568,973)
Leases payable (112,376) – (112,376)
Add applicable
Unspent bond proceeds 590,388 – 590,388
Net investment in capital assets 34,985,781$ 22,607,046$ 57,592,827$
V.Deficit Fund Equity
The following funds had fund balance or net position deficits at December 31, 2021:
Fund Amount
HRA Bonds Debt Service Fund 1,978,033$
Internal service funds
Insurance Reserve 334,426$
The City plans to fund these deficits with future property taxes, tax increments, or transfers.
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NOTE 2 – CASH AND INVESTMENTS
A.Components of Cash and Investments
Cash and investments at year-end consist of the following:
Deposits 10,797,806$
Investments 37,168,415
Petty cash 2,500
Total 47,968,721$
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 $10,797,806, while the balance on the bank
records was $10,982,903. All deposits at year-end were fully covered by federal deposit insurance or
collateral held by the City’s agent in the City’s name.
C.Investments
The City has the following investments at year-end:
Fair Value
Measurements
Investment Type Rating Agency Using No Maturity Less Than 1 1 to 5 Greater Than 5 Total
U.S. treasury securities AAA Moody’s Level 2 –$ –$ 11,380,105$ 1,242,471$ 12,622,576$
U.S. agency securities AA S&P Level 2 – 8,346,858 394,164 – 8,741,022
State and local bonds AA S&P Level 2 – 503,377 693,942 – 1,197,319
State and local bonds AA Moody’s Level 2 – –544,789 – 544,789
Negotiable certificates of deposit Level 2 – 5,019,603 2,526,685 – 7,546,288
4M Fund investment pool Not Applicable 5,311,990 – – – 5,311,990
Mutual funds AAA S&P Level 1 1,204,431 – – – 1,204,431
Total investments 6,516,421$ 13,869,838$ 15,539,685$ 1,242,471$ 37,168,415$
Not Rated
Credit Risk
Not Rated
Interest Risk –
Maturity Duration in Years
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 less;
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 i n 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, 2021, the City
had 11.9 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, 2021
totaled $237,500. Loans receivable in nonmajor governmental funds totaled $18,034.
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NOTE 4 – INTERFUND BALANCES AND TRANSFERS
The composition of internal balances as of December 31, 2021 is as follows:
Receivable Fund Payable Fund Amount
Due from/to other funds
Governmental Business-type
General Fund Ice Arena 194,063$
Governmental Governmental
EDA HRA Construction 2,626
Governmental Governmental
Nonmajor governmental Street Infrastructure 75,000
Total due from/to other funds 271,689
Advances to/from other funds
Governmental Governmental
Economic Development Authority HRA Construction 1,438,055
Economic Development Authority HRA Bonds 353,865
HRA Construction HRA Bonds 2,019,009
Nonmajor governmental Street Infrastructure 300,000
Total advances from/to other funds 4,110,929
Interfund activity eliminated from government-wide statements (4,188,555)
Internal service fund activities related to the enterprise funds 498,060
Total internal balances – government-wide statements 692,123$
In 2021, the General Fund loaned the Ice Arena Fund $194,063 for cash flow purposes, the balance is
expected to be paid back in 2022.
In 2021, the Economic Development Authority Fund loaned the HRA Construction Fund $2,626 for cash
flow purposes, the balance is expected to be paid back in 2022.
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, 2021, the balance outstanding was
$1,438,055.
In 2015, the Economic Development Authority Fund and the HRA Construction Fund loaned the HRA
Bonds Debt Service Fund $322,016 and $1,837,286, respectively, for the purchase of the Hy-Vee property.
The interfund loan matures in 2042 and carries an interest rate of 4.00 percent. As of December 31, 2021,
the balances outstanding, including accrued interest, were $353,865 and $2,019,009, respectively.
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, 2021, the balance outstanding was $375,000.
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NOTE 4 – INTERFUND BALANCES AND TRANSFERS (CONTINUED)
Interfund transfers during the year ended December 31, 2021 were as follows:
Nonmajor Ice Arena
General Governmental Enterprise Total
Transfer Out
General –$ 1,642,533$ (3)–$ 1,642,533$
Economic Development Authority 36,504 (1)– – 36,504
Nonmajor governmental – 2,041,664 (4)500,000 (5)2,541,664
Sewer Utility Enterprise 56,952 (2)– – 56,952
Water Utility Enterprise 59,388 (2)– – 59,388
Golf Course Enterprise 11,040 (2)– – 11,040
Ice Arena Enterprise 11,040 (2)– – 11,040
Storm Water Enterprise 24,828 (2)– – 24,828
Internal Service 250,920 (2)1,650,000 (6)– 1,900,920
Total 450,672$ 5,334,197$ 500,000$ 6,284,869$
(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)
(4)
(5)
(6)Transfer from Internal Service Central Garage Fund to nonmajor governmental Public Works Facility CIP Fund for
public works facility capital improvements.
Transfers In
Funds
Transfers from General Fund to close out the nonmajor 2010B G.O. Equipment Bonds Fund and transfer excess
fund balance to the nonmajor governmental Temporary Financing Fund.
Transfers from nonmajor governmental City Hall CIP Fund and Temporary Financing Fund to nonmajor
governmental Public Works Facility CIP Fund for public works facility capital improvements.
Transfer from nonmajor governmental Park Infrastructure Capital Projects Fund to Ice Arena Enterprise Fund for
debt service and capital improvements.
-49-
NOTE 5 – CAPITAL ASSETS
Capital asset activity for the year ended December 31, 2021 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 19,939,298 3,854,511 (67,581) 23,726,228
Total capital assets, not depreciated 20,933,566 3,854,511 (67,581) 24,720,496
Capital assets, depreciated
Buildings and structures 25,408,669 – – 25,408,669
Vehicles and equipment 10,531,390 985,539 (133,781) 11,383,148
Improvements other than buildings 47,227,137 67,581 – 47,294,718
Total capital assets, depreciated 83,167,196 1,053,120 (133,781) 84,086,535
Less accumulated depreciation on
Buildings and structures (5,273,368) (646,723) – (5,920,091)
Vehicles and equipment (8,185,930) (512,764) 133,781 (8,564,913)
Improvements other than buildings (17,307,554) (2,303,063) – (19,610,617)
Total accumulated depreciation (30,766,852) (3,462,550) 133,781 (34,095,621)
Net capital assets, depreciated 52,400,344 (2,409,430) – 49,990,914
Total capital assets, net 73,333,910$ 1,445,081$ (67,581)$ 74,711,410$
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 1,370,824 1,246,572 (1,018,889) 1,598,507
Total capital assets, not depreciated 1,855,866 1,246,572 (1,018,889) 2,083,549
Capital assets, depreciated
Buildings and structures 10,797,364 – – 10,797,364
Vehicles and equipment 2,505,156 560,736 – 3,065,892
Improvements other than buildings 28,522,699 469,501 – 28,992,200
Total capital assets, depreciated 41,825,219 1,030,237 – 42,855,456
Less accumulated depreciation on
Buildings and structures (4,860,168) (212,182) – (5,072,350)
Vehicles and equipment (2,137,662) (56,987) – (2,194,649)
Improvements other than buildings (7,346,755) (719,873) – (8,066,628)
Total accumulated depreciation (14,344,585) (989,042) – (15,333,627)
Net capital assets, depreciated 27,480,634 41,195 – 27,521,829
Total capital assets, net 29,336,500$ 1,287,767$ (1,018,889)$ 29,605,378$
-50-
NOTE 5 – CAPITAL ASSETS (CONTINUED)
C.Depreciation Expense by Function
Depreciation expense for the year ended December 31, 2021 was charged to the following functions:
Governmental activities
General government 479,517$
Public safety 65,305
Public works 2,006,106
Culture and recreation 339,808
Internal service 571,814
Total depreciation expense – governmental activities 3,462,550$
Business-type activities
Sewer utility 186,968$
Water utility 297,161
Golf course 37,298
Ice arena 202,133
Storm water 245,996
Street lighting 19,486
Total depreciation expense – business-type activities 989,042$
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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 or abatements:
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 2,740,000$
G.O. Street Reconstruction Bonds, Series 2016A 4,855,000$ 2.25–3.00%12/29/2016 02/01/2033 4,050,000
G.O. Street Reconstruction Bonds, Series 2017A 18,435,000$ 3.00–5.00%12/28/2017 02/01/2034 16,580,000
G.O. Street Reconstruction Bonds, Series 2018A 9,520,000$ 3.25–5.00%12/20/2018 02/01/2035 9,055,000
G.O. Street Reconstruction Bonds, Series 2019A 5,235,000$ 3.00–4.00%07/18/2019 02/01/2035 4,970,000
G.O. Tax Abatement Bonds, Series, 2021A 2,020,000$ 1.00%03/11/2021 12/01/2028 1,800,000
Total General Obligation Bonds 39,195,000$
The annual debt service to maturity for G.O. bonds are as follows:
Year Ending
December 31,Principal Interest Principal Interest Principal Interest
2022 2,038,688$ 1,221,372$ 476,312$ 99,847$ 2,515,000$ 1,321,219$
2023 2,132,218 1,125,983 497,782 90,360 2,630,000 1,216,343
2024 2,233,460 1,028,748 516,540 80,496 2,750,000 1,109,244
2025 2,324,080 938,824 535,920 70,788 2,860,000 1,009,612
2026 2,407,610 842,662 552,390 61,231 2,960,000 903,893
2027–2031 13,552,456 2,736,499 1,842,544 160,607 15,395,000 2,897,106
2032–2035 9,758,713 553,677 326,287 9,851 10,085,000 563,528
34,447,225$ 8,447,765$ 4,747,775$ 573,180$ 39,195,000$ 9,020,945$
Governmental Activities Business-Type Activities Total
The proceeds of the G.O. Tax Abatement Bonds, Series 2021A, along with available city resources, were
used to call the outstanding principal of the City’s 2011A Taxable Lease Revenue Bonds totaling
$3,505,000, in advance of their stated maturities on April 1, 2021. This current refunding reduced future
debt service payments by $174,358, and resulted in a present value savings of $128,182.
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NOTE 6 – LONG-TERM LIABILITIES (CONTINUED)
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
$863,677 and $760,734, respectively.
Final Balance –
Description Original Issue Interest Rate Issue Date Maturity Date End of Year
G.O. Tax Increment Refunding Bonds, Series, 2012A 2,695,000$ 2.00–2.45%01/11/2012 02/01/2025 1,055,000$
G.O. Tax Increment Refunding Bonds, Series, 2012B 1,330,000$ 1.35–4.65%01/11/2012 02/01/2031 940,000
G.O. Tax Increment Refunding Bonds, Series, 2015A 5,960,000$ 2.00–3.00%06/17/2015 02/01/2032 4,550,000
Total G.O. Tax Increment Bonds 6,545,000$
The annual debt service to maturity for G.O. bonds are as follows:
Year Ending
December 31,Principal Interest Principal Interest Principal Interest
2022 602,837$ 139,876$ 97,163$ 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 389,995 82,645 105,005 20,929 495,000 103,574
2027–2031 2,092,974 225,891 567,026 60,552 2,660,000 286,443
2032 346,253 5,199 123,747 1,851 470,000 7,050
5,350,170$ 788,256$ 1,194,830$ 188,622$ 6,545,000$ 976,878$
Business-Type ActivitiesGovernmental Activities Total
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NOTE 6 – LONG-TERM LIABILITIES (CONTINUED)
C.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 $78,165 and $3,906,809, respectively. Principal and interest paid
for the current year and total customer revenues for the Water Utility Fund were $399,182 and $5,545,731,
respectively. Principal and interest paid for the current year and total customer revenues for the Storm Water
Fund were $194,573 and $1,321,518, respectively.
Final Balance –
Description Original Issue Interest Rate Issue Date Maturity Date End of Year
2010B G.O. Water Revenue Refunding Bonds 605,000$ 2.00–3.00%11/23/2010 02/01/2022 65,000$
2011 G.O. Public Facilities Authority Note 411,738$ 1.70%02/23/2011 08/20/2029 189,000
2013 G.O. Public Facilities Authority Note 1,035,000$ 1.00%07/24/2013 08/20/2032 634,000
Total G.O. Revenue Bonds and Notes 888,000$
The annual debt service to maturity for G.O. revenue bonds are as follows:
Year Ending
December 31,Principal Interest
2022 142,000$ 10,534$
2023 78,000 8,634
2024 79,000 7,692
2025 79,000 6,741
2026 81,000 5,789
2027–2031 368,000 14,457
2032 61,000 610
888,000$ 54,457$
Business-Type Activities
D.Leases Payable
In 2021, the City entered lease agreements to purchase three police vehicles capitalized at a total value of
$114,728. Accumulated depreciation on the vehicles was $3,315 at year-end. The leases are secured by the
vehicles, bear interest rates ranging from 1.36 to 1.92 percent, and require 48 monthly payments with a
final maturity date of December 27, 2025. Minimum future lease payments are as follows:
29,136$
29,136
29,136
25,957
113,365
(991)
112,374$
Year Ending December 31,
Amount representing interest
Lease principal
2022
2023
2024
2025
Total payments
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NOTE 6 – LONG-TERM LIABILITIES (CONTINUED)
E.Changes in Long-Term Liabilities
Long-term liability activity for the year ended December 31, 2021, was as follows:
Beginning Due Within
of Year Additions Deletions End of Year One Year
Governmental activities
Bonds payable
G.O. bonds 36,411,960$ –$ 1,964,735$ 34,447,225$ 2,038,688$
G.O. tax increment bonds 5,934,320 – 584,150 5,350,170 602,837
Add – premiums on bonds 2,589,786 – 165,797 2,423,989 –
Total bonds payable, net 44,936,066 – 2,714,682 42,221,384 2,641,525
Leases payable – 114,728 2,352 112,376 28,682
Compensated absences 843,456 821,295 789,662 875,089 87,509
Total governmental activities 45,779,522 936,023 3,506,696 43,208,849 2,757,716
Business-type activities
Bonds payable
G.O. bonds 3,168,040 2,020,000 440,265 4,747,775 476,312
G.O. tax increment bonds 1,290,680 – 95,850 1,194,830 97,163
Lease revenue bonds 3,505,000 – 3,505,000 – –
G.O. revenue bonds and notes 1,109,000 – 221,000 888,000 142,000
Add – premiums on bonds 136,492 44,747 13,512 167,727 –
Total business-type activities 9,209,212 2,064,747 4,275,627 6,998,332 715,475
Total government-wide 54,988,734$ 3,000,770$ 7,782,323$ 50,207,181$ 3,473,191$
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, 2021, the City had the following fund balances:
Economic
Development HRA Street
General Authority Construction Infrastructure
Nonspendable 49,680$ –$ –$ –$
Restricted
Economic development – – 5,955,136 –
Capital improvements – – – –
Debt service – – – –
Public safety – police expenditures – – – –
Ice arena – – – –
Total restricted – – 5,955,136 –
Committed
Economic development –4,212,479 – –
Solid waste operations ––– –
Total committed –4,212,479 – –
Assigned
City Hall improvements – – – –
Public works facility improvements – – – –
Street improvements – – – 1,156,367
General improvements – – – –
Capital equipment – – – –
Park improvements – – – –
Total assigned – – – 1,156,367
Unassigned 8,624,063 – – –
Total 8,673,743$ 4,212,479$ 5,955,136$ 1,156,367$
Other
Governmental
HRA Bonds Funds Total
Nonspendable –$ –$ 49,680$
Restricted
Economic development – – 5,955,136
Capital improvements –590,388 590,388
Debt service –3,093,625 3,093,625
Public safety – police expenditures –134,455 134,455
Ice arena –5,460 5,460
Total restricted –3,823,928 9,779,064
Committed
Economic development –85,051 4,297,530
Solid waste operations –223,442 223,442
Total committed –308,493 4,520,972
Assigned
City Hall improvements –595,273 595,273
Public works facility improvements –1,740,002 1,740,002
Street improvements ––1,156,367
General improvements –3,237,914 3,237,914
Capital equipment –817,044 817,044
Park improvements –1,512,440 1,512,440
Total assigned –7,902,673 9,059,040
Unassigned (1,978,033) – 6,646,030
Total (1,978,033)$ 12,035,094$ 30,054,786$
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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 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 off icers 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 for
each of the first 10 years of service, and 1.7 percent for each additional year. Under Method 2, the
accrual rate for Coordinated Plan members is 1.7 percent 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)
Benefit increases are provided to benefit recipients each January. The post-retirement increase is
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 percen t 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. 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. The post-retirement increase is
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. 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 2021, and 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, 2021, were
$352,307. The City’s contributions were equal to the required contributions as set by state statutes.
2.PEPFF Contributions
Police and Fire Plan members were required to contribute 11.80 percent of their annual covered
salary in fiscal year 2021, and the City was required to contribute 17.70 percent for Police and Fire
Plan members. The City’s contributions to the PEPFF for the year ended December 31, 2021, were
$552,048. 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, 2021, the City reported a liability of $2,754,439 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 state of Minnesota’s proportionate share of the net pension liability associated with the City
totaled $84,153. The net pension liability was measured as of June 30, 2021, and the total pension
liability used to calculate the net pension liability was determined by an actuarial valuation as of
that date. The City’s proportion of the net pension liability was based on the City’s contributions
received by the PERA during the measurement period for employer payroll paid dates from July 1,
2020 through June 30, 2021, relative to the total employer contributions received from all of the
PERA’s participating employers. The City’s proportionate share was 0.0645 percent at the end of
the measurement period and 0.0626 percent for the beginning of the period.
The amount recognized by the City as its proportionate share of the net pension liability, the direct
aid, and total portion of the net pension liability that was associated with the City were as follows:
City’s proportionate share of the net pension liability 2,754,439$
State’s proportionate share of the net pension liability
associated with the City 84,153$
For the year ended December 31, 2021, the City recognized pension expense of $117,043 for its
proportionate share of the GERF’s pension expense. In addition, the City recognized an additional
$6,790 as pension expense (and grant revenue) for its proportionate share of the state of
Minnesota’s contribution of $16.0 million to the GERF.
At December 31, 2021, the City reported its proportionate share of the GERF’s deferred outflows
of resources and deferred inflows of resources related to pensions from the following sources:
Deferred Deferred
Outflows Inflows
of Resources of Resources
Differences between expected and actual economic experience 15,978$ 84,006$
Changes in actuarial assumptions 1,681,803 58,624
Net collective difference between projected and actual
investment earnings – 2,389,032
Changes in proportion 146,299 –
Contributions paid to the PERA subsequent to the
measurement date 176,067 –
Total 2,020,147$ 2,531,662$
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
A total of $176,067 reported as deferred outflows of resources related to pensions resulting from
city contributions subsequent to the measurement date will be recognized as a reduction of the net
pension liability in the year ending December 31, 2022. Other amounts reported as deferred
outflows and deferred inflows of resources related to pensions will be recognized in pension
expense as follows:
Pension
Year Ending Expense
December 31,Amount
2022 (49,509)$
2023 8,296$
2024 4,271$
2025 (650,640)$
2.PEPFF Pension Costs
At December 31, 2021, the City reported a liability of $1,968,330 for its proportionate share of the
PEPFF’s net pension liability. The net pension liability was measured as of June 30, 2021, 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, 2020 through June 30, 2021, relative to the total employer contributions received from
all of the PERA’s participating employers. The City’s proportionate share was 0.2550 percent at
the end of the measurement period and 0.2899 percent for the beginning of the period.
The state of Minnesota contributed $18.0 million to the PEPFF in the plan fiscal year ended
June 30, 2021. The contribution consisted of $9.0 million in direct state aid that does meet the
definition of a special funding situation and $9.0 million in supplemental state aid that does not
meet the definition of a special funding situation. The $9.0 million direct state aid was paid on
October 1, 2020. Thereafter, by October 1 of each year, the state will pay $9.0 million to the PEPFF
until full funding is reached or July 1, 2048, whichever is earlier. The $9.0 million in supplemental
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. Strong asset returns for the fiscal year ended 2021 will accelerate the phasing out of these
state contributions, although we do not anticipate them to be phased out during the fiscal year
ending 2022.
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 $9.0 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 68 special funding situation
accounting and financial reporting requirements. For the year ended December 31, 2021, the City
recognized negative pension expense of $236,511 for its proportionate share of the Police and Fire
Plan’s pension expense. The City recognized $16,118 as grant revenue for its proportionate share
of the state of Minnesota’s pension expense for the contribution of $9.0 million to the PEPFF.
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
The amount recognized by the City as its proportionate share of the net pension liability, the direct
aid, and total portion of the net pension liability that was associated with the City were as follows:
City’s proportionate share of the net pension liability 1,968,330$
State’s proportionate share of the net pension liability
associated with the City 88,503$
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 supplemental state aid. The City
recognized $22,950 for the year ended December 31, 2021 as revenue and an offsetting reduction
of net pension liability for its proportionate share of the state of Minnesota ’s on-behalf
contributions to the PEPFF.
At December 31, 2021, the City reported its proportionate share of the PEPFF’s deferred outflows
of resources and deferred inflows of resources related to pensions from the following sources:
Deferred Deferred
Outflows Inflows
of Resources of Resources
Differences between expected and actual economic experience 392,574$ –$
Changes in actuarial assumptions 2,892,930 1,200,170
Net collective difference between projected and actual
investment earnings – 3,713,471
Changes in proportion 96,688 543,911
Contributions paid to the PERA subsequent to the
measurement date 279,824 –
Total 3,662,016$ 5,457,552$
A total of $279,824 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, 2022. Other amounts rep orted 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
2022 $ (1,561,135)
2023 $ (284,876)
2024 $ (300,607)
2025 $ (485,391)
2026 $ 556,649
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
E.Long-Term Expected Return on Investments
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 equity 33.50 %5.10 %
International equity 16.50 5.30 %
Fixed income 25.00 0.75 %
Private markets 25.00 5.90 %
Total 100.00 %
Allocation
Target
Real Rate of Return
Long-Term Expected
F.Actuarial Assumptions
The total pension liability in the June 30, 2021, actuarial valuation was determined using an individual
entry-age normal actuarial cost method. The long-term rate of return on pension plan investments used in
the determination of the total liability is 6.50 percent. This assumption is based on a review of inflation and
investments return assumptions from a number of national investment consulting firms. The review
provided a range of return investment return rates deemed to be reasonable by the actuary. An investment
return of 6.50 percent was deemed to be within that range of reasonableness for financial reporting purposes.
Inflation is assumed to be 2.25 percent for the General Employees Plan and 2.25 percent for the Police and
Fire Plan. Benefit increases after retirement are assumed to be 1.25 percent for the General Employees Plan.
The Police and Fire Plan benefit increase is fixed at 1.00 percent per year and that increase was used in the
valuation.
Salary growth assumptions in the General Employees Plan range in annual increments from 10.25 percent
after one year of service to 3.00 percent after 29 years of service, and 6.00 percent per year thereafter. In
the Police and Fire Plan, salary growth assumptions range from 11.75 percent after one year of service to
3.00 percent after 24 years of service.
Mortality rates for the General Employees Plan are based on the Pub-2010 General Employee Mortality
Table. Mortality rates for the Police and Fire Plan are based on the Pub-2010 Public Safety Employee
Mortality tables. The tables are adjusted slightly to fit the PERA’s experience.
Actuarial assumptions for the General Employees Plan are reviewed every four years. The most recent
four-year experience study for the General Employees Plan was completed in 2019. The assumption
changes were adopted by the Board and became effective with the July 1, 2020 actuarial valuation. The
most recent four-year experience study for the Police and Fire Plan was completed in 2020, adopted by the
Board, and became effective with the July 1, 2021 actuarial valuation.
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
The following changes in actuarial assumptions occurred in 2021:
1.GERF
CHANGES IN ACTUARIAL ASSUMPTIONS
•The investment return and single discount rates were changed from 7.50 percent to
6.50 percent, for financial reporting purposes.
•The mortality improvement scale was changed from Scale MP-2019 to Scale MP-2020.
2.PEPFF
CHANGES IN ACTUARIAL ASSUMPTIONS
•The investment return and single discount rates were changed from 7.50 percent to
6.50 percent, for financial reporting purposes.
•The inflation assumption was changed from 2.50 percent to 2.25 percent.
•The payroll growth assumption was changed from 3.25 percent to 3.00 percent.
•The base mortality table for healthy annuitants and employees was changed from the
RP-2014 table to the Pub-2010 Public Safety Mortality table. The mortality improvement scale
was changed from MP-2019 to MP-2020.
•The base mortality table for disabled annuitants was changed from the RP-2014 healthy
annuitant mortality table (with future mortality improvement according to Scale MP -2019) to
the Pub-2010 Public Safety disabled annuitant mortality table (with future mortality
improvement according to Scale MP-2020).
•Assumed rates of salary increase were modified as recommended in the July 14, 2020
experience study. The overall impact is a decrease in gross salary increase rates.
•Assumed rates of retirement were changed as recommended in the July 14, 2020 experience
study. The changes result in slightly more unreduced retirements and fewer assumed early
retirements.
•Assumed rates of withdrawal were changed from select and ultimate rates to service -based
rates. The changes result in more assumed terminations.
•Assumed rates of disability were increased for ages 25–44 and decreased for ages over 49.
Overall, proposed rates result in more projected disabilities.
•Assumed percent married for active female members was changed from 60.00 percent to
70.00 percent. Minor changes to form of payment assumptions were applied.
G.Discount Rate
The discount rate used to measure the total pension liability in 2021 was 6.50 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.
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
H.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:
City’s proportionate share of
the GERF net pension liability
City’s proportionate share of
the PEPFF net pension liability
5.50%6.50%7.50%
405,000$
6,249,114$ (1,540,853)$
5,617,649$
1,968,330$
2,754,439$
1% Decrease in
Discount Rate
1% Increase in
Discount RateDiscount Rate
I.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 internet at www.mnpera.org.
J.PERA Defined Benefit Pension Plan Totals
Total net pension liabilities, deferred outflows and inflows of resources, and pension expense reported for
PERA defined benefit pension plans as of and for the fiscal year ended December 31, 2021, are as follows:
Deferred Deferred
Net Pension Outflows of Inflows of Pension
PERA Pension Plan Liability Resources Resources Expense
GERF 2,754,439$ 2,020,147$ 2,531,662$ 123,833$
PEPFF 1,968,330 3,662,016 5,457,552 (220,393)
Total – all plans 4,722,769$ 5,682,163$ 7,989,214$ (96,560)$
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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 2021 were:
Required Rate
for Employees
Employee Employer Employee Employer and Employers
2,744$ 2,744$ 5.00%5.00%5.00%
Contribution Amount Percentage of Covered Payroll
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
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NOTE 10 – OTHER POST-EMPLOYMENT BENEFITS (OPEB) PLAN (CONTINUED)
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 2021, the City’s contributed $27,550 to the Retiree
Health Plan.
C.Actuarial Methods and Assumptions
The City’s total OPEB liability of $903,535 was measured as of December 31, 2021, and the total OPEB
liability used to calculate the total OPEB liability was determined by an actuarial valuation as of
December 31, 2020, using the entry-age normal cost method. Liability gains or losses and plan changes are
recognized immediately in accordance with GASB Statement No. 75 alternative measurement method
requirements.
The total OPEB liability in the December 31, 2020 valuation was determined using the following actuarial
assumptions, applied to all periods included in the measurement, unless otherwise specified:
Discount rate 2.06%
Expected long-term investment return 2.06%
20-year municipal bond yield 2.06%
Inflation rate 2.50%
Healthcare cost trend rate 6.50% in 2021, grading to 3.90%
Withdrawal, mortality, and salary scale assumptions were based on those used to value pension liabilities
for Minnesota city employees participating in the PERA GERF and PEPFF plans. The PERA pension plans
base their assumptions on periodic experience studies as detailed earlier in these notes. Economic
assumptions are based on input from a variety of published sources of historical and projected future
financial data. Each assumption was reviewed for reasonableness with the source information , as well as
for consistency with the other economic assumptions.
Since the plan is not funded by an irrevocable trust, the discount rate is equal to the 20-year municipal bond
yield rate of 2.06 percent, which was set by considering published rate information for 20-year high quality,
tax-exempt, general obligation municipal bonds as of the measurement date. The discount rate used in the
prior measurement date was 2.12 percent.
Future retirees electing coverage is assumed to be 55 percent when a pre-age 65 subsidy is available, and
100 percent of all disabled in the line of duty members are assumed to elect coverage at retirement. Actual
spouse elections are used for current and future retirees. All retirees are assumed to become Medicare
eligible at age 65.
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NOTE 10 – OTHER POST-EMPLOYMENT BENEFITS (OPEB) PLAN (CONTINUED)
The following actuarial assumptions changed since the previous valuation:
•The discount rate was changed from 2.12 percent to 2.06 percent.
•Healthcare cost trend rates and per capita medical claims were updated based on published trend
models and recent experience to better reflect future anticipated experience.
•Withdrawal, mortality, and salary scale assumptions were updated to those used in the most
recently published PERA GERF and PEPFF valuations.
D.Changes in the Total OPEB Liability
Total OPEB
Liability
Beginning balance – January 1, 2021 1,298,682$
Changes for the year
Service cost 102,913
Interest 29,424
Difference between expected and actual experience (479,230)
Changes of assumptions (20,704)
Benefit payments (27,550)
Total net changes (395,147)
Ending balance – December 31, 2021 903,535$
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 or 1 percentage point
higher than the current discount rate:
Discount rate
Total OPEB liability 982,313$ 831,201$
1.06% 3.06%
1% Decrease in 1% Increase in
Discount Rate Discount RateDiscount Rate
903,535$
2.06%
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 or
1 percentage point higher than the current healthcare cost trend rate:
Healthcare cost trend rate
Total OPEB liability
7.50%, decreasing
to 4.90%
796,939$ 1,029,868$ 903,535$
1% Decrease in 1% Increase in
Trend Rate Trend Rate
Healthcare Cost
Trend Rate
Healthcare Cost Healthcare Cost
5.50%, decreasing
to 2.90%
6.50%, decreasing
to 3.90%
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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 $168,509 represents
the original contributions for working capital; however, the City’s share of subsequent construction costs
are not determinable. Therefore, the City’s Water Fund has not recorded any subsequent amounts as an
equity investment or contributed capital related to the JWC.
The following financial information is from the JWC’s audited financial statements for the year ended
December 31, 2020, the most recent information available at the date of this report, which are available at
Golden Valley City Hall:
Total assets 20,370,791$
Total liabilities 940,445$
Net position 19,430,346$
Total revenue 9,851,904$
Total expenses 8,851,973$
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 $374,558.
The following financial information is taken from the District’s audited financial statements for the year
ended December 31, 2021:
Total assets 6,596,515$
Total deferred outflows of resources 933,833$
Total liabilities 4,334,321$
Total deferred inflows of resources 1,268,747$
Net position 1,927,280$
Total revenue 3,559,285$
Total expenses 2,894,852$
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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, 2021, the amount reported as investment in joint venture was $974,626.
According to a formula in the agreement, the City’s share of the District’s budget is 50.6 percent for 2021,
and city payments to the District totaled $1,352,363. The District’s financial statements 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, 2021 was $29,533, 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 $13,463 for these services in 2021.
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 provided to its re sidents.
In 2021, 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, 2021, the City is committed to various construction contracts for the improvement of city
property. The City’s remaining commitment under these contracts is approximately $1,352,000 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, 2021, there were five series of industrial revenue
bonds outstanding. The original issue amounts totaled $12,910,000 and have been reduced through annual
payments and partial call prepayments. The outstanding balance as of December 31, 2021 is undetermined.
NOTE 13 – SUBSEQUENT EVENTS
A.New Accounting Standards
A new standard has been issued by the GASB that will result in significant changes in the reporting of lease
transactions once it becomes effective for governmental entities. This standard will be adopted by the City
beginning in 2022, and will require the restatement of certain balances reported as of December 31, 2021.
The effects of this change have not yet been determined and are not reflected in these financial statements.
B.COVID-19
The COVID-19 pandemic has had significant financial and operational impacts on the City for the last
two fiscal years. Any potential impact it may have on the City’s future operations and finances cannot be
determined at this time and has not been reflected in these financial statements.
REQUIRED SUPPLEMENTARY INFORMATION
CITY OF NEW HOPE, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2021
Proportionate
Share of the
City’s Net Pension
Proportionate Liability and City’s
Share of the the City’s Proportionate Plan Fiduciary
State of Share of the Share of the Net Position
City’s City’s Minnesota’s State of Net Pension as a
PERA Fiscal Proportion Proportionate Proportionate Minnesota’s Liability as a Percentage
Year-End Date of the Net Share of the Share of the Share of the City’s Percentage of of the Total
(Measurement Pension Net Pension Net Pension Net Pension Covered Covered Pension
Date)Liability Liability Liability Liability Payroll Payroll Liability
06/30/2015 0.0617% 3,197,614$ –$ 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%
06/30/2021 0.0645% 2,754,439$ 84,153$ 2,838,592$ 4,646,514$ 59.28% 87.00%
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%
352,307$ 352,307$ –$ 4,697,399$ 7.50%
Note:
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 Date
12/31/2015
12/31/2021
12/31/2021
CITY OF NEW HOPE
PERA – General Employees Retirement Fund
Schedule of City’s and Nonemployer Proportionate Share of Net Pension Liability
Year Ended December 31, 2021
Year Ended December 31, 2021
PERA – General Employees Retirement Fund
Schedule of City Contributions
City Fiscal
Year-End Date
12/31/2015
12/31/2016
12/31/2017
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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%
06/30/2021 0.2550% 1,968,330$ 88,503$ 2,056,833$ 3,014,250$ 65.30% 93.70%
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%
552,048$ 552,048$ –$ 3,118,916$ 17.70%
Note:
12/31/2021
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 Date
12/31/2015
12/31/2016
12/31/2017
City Fiscal
Year-End Date
12/31/2015
12/31/2016
Year Ended December 31, 2021
Schedule of City Contributions
PERA – Public Employees Police and Fire Fund
12/31/2017
12/31/2019
12/31/2018
12/31/2018
12/31/2019
12/31/2020
CITY OF NEW HOPE
PERA – Public Employees Police and Fire Fund
Schedule of City’s and Nonemployer Proportionate Share of Net Pension Liability
Year Ended December 31, 2021
12/31/2021
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2018 2019 2020 2021
Total OPEB liability
Service cost 64,269$ 72,745$ 89,655$ 102,913$
Interest 31,335 38,452 33,026 29,424
Differences between expected and actual experience – 81,871 27 (479,230)
Changes in assumptions (53,393) 74,709 71,306 (20,704)
Benefit payments (25,947) (16,942) (22,038) (27,550)
Net change in total OPEB liability 16,264 250,835 171,976 (395,147)
Total OPEB liability – beginning of year 859,607 875,871 1,126,706 1,298,682
Total OPEB liability – end of year 875,871$ 1,126,706$ 1,298,682$ 903,535$
Covered payroll 6,400,000$ 7,100,000$ 7,400,000$ 9,400,000$
Total OPEB liability as a percentage of covered payroll 13.69%15.87%17.55%9.61%
Note 1:
Note 2:
CITY OF NEW HOPE
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.
Fiscal Year Ended December 31,
Year Ended December 31, 2021
OPEB Liability and Related Ratios
Schedule of Changes in the City’s Total
Other Post-Employment Benefits Plan
There are no plan assets accumulated in a trust that meets the criteria in paragraph 4 of GASB Statement No. 75 to
pay these benefits.
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CITY OF NEW HOPE
Notes to Required Supplementary Information
December 31, 2021
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PERA – GENERAL EMPLOYEES RETIREMENT FUND
2021 CHANGES IN ACTUARIAL ASSUMPTIONS
•The investment return and single discount rates were changed from 7.50 percent to
6.50 percent, for financial reporting purposes.
•The mortality improvement scale was changed from Scale MP-2019 to Scale MP-2020.
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 100.00 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.
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
Notes to Required Supplementary Information (continued)
December 31, 2021
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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
Notes to Required Supplementary Information (continued)
December 31, 2021
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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
Notes to Required Supplementary Information (continued)
December 31, 2021
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PERA – PUBLIC EMPLOYEES POLICE AND FIRE FUND
2021 CHANGES IN ACTUARIAL ASSUMPTIONS
•The investment return and single discount rates were changed from 7.50 percent to
6.50 percent, for financial reporting purposes.
•The inflation assumption was changed from 2.50 percent to 2.25 percent.
•The payroll growth assumption was changed from 3.25 percent to 3.00 percent.
•The base mortality table for healthy annuitants and employees was changed from the RP-2014
Table to the Pub-2010 Public Safety Mortality Table. The mortality improvement scale was
changed from MP-2019 to MP-2020.
•The base mortality table for disabled annuitants was changed from the RP-2014 Healthy
Annuitant Mortality Table (with future mortality improvement according to Scale MP-2019)
to the Pub-2010 Public Safety Disabled Annuitant Mortality Table (with future mortality
improvement according to Scale MP-2020).
•Assumed rates of salary increase were modified as recommended in the July 14, 2020
experience study. The overall impact is a decrease in gross salary increase rates.
•Assumed rates of retirement were changed as recommended in the July 14, 2020 experience
study. The changes result in slightly more unreduced retirements and fewer assumed early
retirements.
•Assumed rates of withdrawal were changed from select and ultimate rates to service -based
rates. The changes result in more assumed terminations.
•Assumed rates of disability were increased for ages 25–44 and decreased for ages over 49.
Overall, proposed rates result in more projected disabilities.
•Assumed percent married for active female members was changed from 60 percent to
70 percent. Minor changes to form of payment assumptions were applied.
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.
CITY OF NEW HOPE
Notes to Required Supplementary Information (continued)
December 31, 2021
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PERA – PUBLIC EMPLOYEES POLICE AND FIRE FUND (CONTINUED)
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 100.00 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.
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
Notes to Required Supplementary Information (continued)
December 31, 2021
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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
2021 CHANGES IN ACTUARIAL ASSUMPTIONS
•The discount rate was changed from 2.12 percent to 2.06 percent.
•Healthcare cost trend rates and per capita medical claims were updated based on published
trend models and recent experience to better reflect future anticipated experience.
•Withdrawal, mortality, and salary scale assumptions were updated to those used in the most
recently published PERA, GERF, and PEPFF valuations.
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, 2021
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.
Nonmajor Governmental Funds
Total
Nonmajor
Special Capital Debt Governmental
Revenue Projects Service Funds
Assets
Cash and temporary investments 399,804$ 8,595,147$ 3,093,625$ 12,088,576$
Receivables
Accounts 24,000 – – 24,000
Loans 18,034 – – 18,034
Special assessments 6,570 48,445 – 55,015
Due from other funds – 75,000 – 75,000
Advances to other funds – 300,000 – 300,000
Total assets 448,408$ 9,018,592$ 3,093,625$ 12,560,625$
Liabilities
Accounts and contracts payable –$ 463,286$ –$ 463,286$
Unearned revenue – 13,800 – 13,800
Total liabilities – 477,086 – 477,086
Deferred inflows of resources
Unavailable revenue – special assessments – 48,445 – 48,445
Fund balances
Restricted for
Public safety police expenditures 134,455 – – 134,455
Ice arena 5,460 – – 5,460
Capital improvements – 590,388 – 590,388
Debt service – –3,093,625 3,093,625
Committed for
Solid waste operations 223,442 – – 223,442
Economic development 85,051 – – 85,051
Assigned for
City Hall improvements – 595,273 – 595,273
Public works facility improvements – 1,740,002 – 1,740,002
General improvements – 3,237,914 – 3,237,914
Capital equipment – 817,044 – 817,044
Park improvements – 1,512,440 – 1,512,440
Total fund balances 448,408 8,493,061 3,093,625 12,035,094
Total liabilities, deferred inflows of
resources, and fund balances 448,408$ 9,018,592$ 3,093,625$ 12,560,625$
December 31, 2021
Combining Balance Sheet
CITY OF NEW HOPE
-79-
Total
Nonmajor
Special Capital Debt Governmental
Revenue Projects Service Funds
Revenues
Taxes
Property taxes –$ 885,655$ 3,746,781$ 4,632,436$
Intergovernmental – 8,124 – 8,124
Charges for services 234,953 51,900 – 286,853
Special assessments – 8,282 – 8,282
Investment earnings (charges)(2,288) (61,116) (13,137) (76,541)
Miscellaneous – 4,250 – 4,250
Total revenues 232,665 897,095 3,733,644 4,863,404
Expenditures
Current
Public works 244,267 – – 244,267
Capital outlay
General government – 212,151 – 212,151
Public works – 1,936,426 – 1,936,426
Culture and recreation – 439,210 – 439,210
Debt service
Principal – – 2,120,042 2,120,042
Interest – 950 1,366,523 1,367,473
Total expenditures 244,267 2,588,737 3,486,565 6,319,569
Excess (deficiency) of
revenues over expenditures (11,602) (1,691,642) 247,079 (1,456,165)
Other financing sources (uses)
Transfers in – 5,333,328 869 5,334,197
Transfers out – (2,541,664) – (2,541,664)
Total other financing
sources (uses)– 2,791,664 869 2,792,533
Net change in fund balances (11,602) 1,100,022 247,948 1,336,368
Fund balances, January 1 460,010 7,393,039 2,845,677 10,698,726
Fund balances, December 31 448,408$ 8,493,061$ 3,093,625$ 12,035,094$
CITY OF NEW HOPE
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended December 31, 2021
-80-
CITY OF NEW HOPE
Nonmajor Special Revenue Funds
Subcombining Balance Sheet
December 31, 2021
9021 9016 9017 9018
Police Solid Waste Ice Arena CEE Revolving
Forfeitures Management Endowment Loan Fund Total
Assets
Cash and temporary investments 134,455$ 192,733$ 5,460$ 67,156$ 399,804$
Receivables
Accounts – 24,139 – (139) 24,000
Loans – –– 18,034 18,034
Special assessments – 6,570 – –6,570
Total assets 134,455$ 223,442$ 5,460$ 85,051$ 448,408$
Fund balances
Restricted for
Public safety police expenditures 134,455$ –$ –$ –$ 134,455$
Ice arena – – 5,460 – 5,460
Committed for
Solid waste operations – 223,442 – – 223,442
Economic development – –– 85,051 85,051
Total fund balances 134,455$ 223,442$ 5,460$ 85,051$ 448,408$
-81-
CITY OF NEW HOPE
Nonmajor Special Revenue Funds
Subcombining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended December 31, 2021
9021 9016 9017 9018
Police Solid Waste Ice Arena CEE Revolving
Forfeitures Management Endowment Loan Fund Total
Revenues
Charges for services –$ 234,953$ –$ –$ 234,953$
Investment earnings (charges)(1,116) (1,654) (45) 527 (2,288)
Total revenues (1,116) 233,299 (45) 527 232,665
Expenditures
Current
Public works
Other services and charges – 231,524 – 12,743 244,267
Net change in fund balances (1,116) 1,775 (45) (12,216) (11,602)
Fund balances, January 1 135,571 221,667 5,505 97,267 460,010
Fund balances, December 31 134,455$ 223,442$ 5,460$ 85,051$ 448,408$
-82-
Actual Over (Under)
Original Final Amounts Budget
Revenues
Charges for services 232,000$ 232,000$ 234,953$ 2,953$
Investment earnings (charges) 1,500 1,500 (1,654) (3,154)
Total revenues 233,500 233,500 233,299 (201)
Expenditures
Current
Public works
Other services and charges 231,512 231,512 231,524 12
Net change in fund balances 1,988 1,988 1,775 (213)
Fund balances, January 1 221,667 221,667 221,667 –
Fund balances, December 31 223,655$ 223,655$ 223,442$ (213)$
Budgeted Amounts
For the Year Ended December 31, 2021
Budget and Actual
Schedule of Revenues, Expenditures, and Changes in Fund Balances –
CITY OF NEW HOPE
Special Revenue Fund – Solid Waste Management Fund
-83-
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.
City Hall CIP Fund – This fund is used to account for the accumulation of resources for City Hall
improvement projects.
Park Infrastructure Fund – This fund is used to account for park improvement projects.
Park/Pool Improvement Project Fund – This fund is used to account for improvements to the City’s pool
and water park facility.
Public Works Facility CIP Fund – This fund is used to account for improvements to the City’s public
works facility.
Temporary Financing Fund – is used to account for various capital project and capital outlay purchases
until permanent financing is acquired.
9010 9202 9233 9234
Park/Pool
Fire City Hall Park Improvement
Capital Projects CIP Infrastructure Project
Assets
Cash and temporary investments 817,044$ 739,497$ 1,536,671$ 605,760$
Receivables
Special assessments – – – –
Due from other funds – – – –
Advances to other funds – – – –
Total assets 817,044$ 739,497$ 1,536,671$ 605,760$
Liabilities
Accounts and contracts payable –$ 144,224$ 10,431$ 15,372$
Unearned revenue – – 13,800 –
Total liabilities – 144,224 24,231 15,372
Deferred inflows of resources
Unavailable revenue –
special assessments – – – –
Fund balances
Restricted for
Capital improvements – – – 590,388
Assigned for
City Hall improvements – 595,273 – –
Public works facility improvements – –– –
General improvements – –– –
Capital equipment 817,044 – – –
Park improvements – – 1,512,440 –
Total fund balances 817,044 595,273 1,512,440 590,388
Total liabilities, deferred inflows
of resources, and fund balances 817,044$ 739,497$ 1,536,671$ 605,760$
CITY OF NEW HOPE
Nonmajor Capital Projects Funds
Subcombining Balance Sheet
December 31, 2021
-84-
9240 9242
Public Works
Facility Temporary
CIP Financing Total
2,033,261$ 2,862,914$ 8,595,147$
– 48,445 48,445
– 75,000 75,000
– 300,000 300,000
2,033,261$ 3,286,359$ 9,018,592$
293,259$ –$ 463,286$
– – 13,800
293,259 – 477,086
– 48,445 48,445
– – 590,388
– – 595,273
1,740,002 – 1,740,002
– 3,237,914 3,237,914
– –817,044
– –1,512,440
1,740,002 3,237,914 8,493,061
2,033,261$ 3,286,359$ 9,018,592$
-85-
9010 9202 9233 9234
Park/Pool
Fire City Hall Park Improvement
Capital Projects CIP Infrastructure Project
Revenues
Taxes
Property taxes –$ –$ 885,655$ –$
Intergovernmental
County – – 3,400 4,724
Charges for services – – 51,900 –
Special assessments – – – –
Investment earnings (charges)(6,765) (9,461) (9,665) 188
Miscellaneous – – 250 4,000
Total revenues (6,765) (9,461) 931,540 8,912
Expenditures
Capital outlay
General government – 212,151 – –
Public works – –– –
Culture and recreation – –370,825 68,385
Debt Service
Interest – 475 – 475
Total expenditures – 212,626 370,825 68,860
Excess (deficiency) of
revenues over expenditures (6,765) (222,087) 560,715 (59,948)
Other financing sources (uses)
Transfers in – – – –
Transfers out – (400,000) (500,000) –
Total other financing
sources (uses)– (400,000) (500,000) –
Net change in fund balances (6,765) (622,087) 60,715 (59,948)
Fund balances, January 1 823,809 1,217,360 1,451,725 650,336
Fund balances, December 31 817,044$ 595,273$ 1,512,440$ 590,388$
CITY OF NEW HOPE
Nonmajor Capital Projects Funds
Subcombining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended December 31, 2021
-86-
9240 9242
Public Works
Facility Temporary
CIP Financing Total
–$ –$ 885,655$
– – 8,124
– – 51,900
– 8,282 8,282
(15,236) (20,177) (61,116)
– – 4,250
(15,236) (11,895) 897,095
– – 212,151
1,936,426 – 1,936,426
– – 439,210
– – 950
1,936,426 – 2,588,737
(1,951,662) (11,895) (1,691,642)
3,691,664 1,641,664 5,333,328
– (1,641,664) (2,541,664)
3,691,664 – 2,791,664
1,740,002 (11,895) 1,100,022
– 3,249,809 7,393,039
1,740,002$ 3,237,914$ 8,493,061$
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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.
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 305,881$ –$ 299,349$ 201,691$
Fund balances
Restricted for debt service 305,881$ –$ 299,349$ 201,691$
December 31, 2021
Subcombining Balance Sheet
Nonmajor Debt Service Funds
CITY OF NEW HOPE
-88-
9150 9151 9152
2017A 2018A 2019A
G.O.G.O.G.O.
Improvement Improvement Improvement
Bonds Bonds Bonds Total
1,546,896$ 338,039$ 401,769$ 3,093,625$
1,546,896$ 338,039$ 401,769$ 3,093,625$
-89-
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 237,747$ –$ 260,979$ 206,828$
Investment earnings (charges)(1,696) – (1,558) (946)
Total revenues 236,051 – 259,421 205,882
Expenditures
Debt service
Principal 155,308 – 159,963 124,771
Interest and fiscal charges 51,736 740 74,189 43,883
Total expenditures 207,044 740 234,152 168,654
Excess (deficiency) of
revenues over expenditures 29,007 (740) 25,269 37,228
Other financing sources
Transfers in – 869 – –
Net change in fund balances 29,007 129 25,269 37,228
Fund balances (deficit), January 1 276,874 (129) 274,080 164,463
Fund balances, December 31 305,881$ –$ 299,349$ 201,691$
CITY OF NEW HOPE
Nonmajor Debt Service Funds
Subcombining Statement of Revenues, Expenditures, and Changes in Fund Balances
For the Year Ended December 31, 2021
-90-
9150 9151 9152
2017A 2018A 2019A
G.O.G.O.G.O.
Improvement Improvement Improvement
Bonds Bonds Bonds Total
1,705,515$ 867,464$ 468,248$ 3,746,781$
(6,759) (512) (1,666) (13,137)
1,698,756 866,952 466,582 3,733,644
950,000 465,000 265,000 2,120,042
670,190 348,421 177,364 1,366,523
1,620,190 813,421 442,364 3,486,565
78,566 53,531 24,218 247,079
– – – 869
78,566 53,531 24,218 247,948
1,468,330 284,508 377,551 2,845,677
1,546,896$ 338,039$ 401,769$ 3,093,625$
-91-
2020
Actual Over (Under)Actual
Original Final Amounts Budget Amounts
Revenues
Taxes
Property taxes 10,880,965$ 10,880,965$ 10,914,572$ 33,607$ 10,422,823$
Franchise taxes 535,000 535,000 522,395 (12,605) 518,162
Total taxes 11,415,965 11,415,965 11,436,967 21,002 10,940,985
Licenses and permits
Business regulatory licenses 74,725 74,725 78,111 3,386 64,760
Nonbusiness licenses and permits 375,850 375,850 320,976 (54,874) 329,151
Total licenses and permits 450,575 450,575 399,087 (51,488) 393,911
Intergovernmental
Local government aid 865,307 865,307 861,726 (3,581) 815,623
Highway maintenance aid 210,000 210,000 213,954 3,954 231,733
Other federal, state, and local grants 114,869 114,869 1,241,183 1,126,314 1,792,954
State insurance premium tax 300,000 300,000 286,502 (13,498) 321,335
Total intergovernmental 1,490,176 1,490,176 2,603,365 1,113,189 3,161,645
Charges for services
General government 179,450 179,450 194,542 15,092 150,967
Public safety 370,750 370,750 333,245 (37,505) 267,931
Public works 5,760 5,760 3,860 (1,900) 3,596
Culture and recreation 1,260,925 1,260,925 959,680 (301,245) 281,826
Total charges for services 1,816,885 1,816,885 1,491,327 (325,558) 704,320
Fines and forfeitures 220,000 220,000 185,603 (34,397) 138,922
Special assessments 40,000 40,000 32,210 (7,790) 110,670
Investment earnings 50,000 50,000 (93,405) (143,405) 113,447
Miscellaneous 2,700 2,700 80,922 78,222 13,184
Total revenues 15,486,301 15,486,301 16,136,076 649,775 15,577,084
Expenditures
Current
General government
Mayor and City Council
Personnel services 59,911 59,911 61,068 1,157 57,043
Supplies 2,700 2,700 2,386 (314) 678
Other services and charges 41,075 41,075 42,413 1,338 36,940
Total Mayor and City Council 103,686 103,686 105,867 2,181 94,661
City Hall
Supplies 20,000 20,000 19,403 (597) 20,232
Other services and charges 361,862 361,862 435,443 73,581 392,964
Total City Hall 381,862 381,862 454,846 72,984 413,196
2021
Schedule of Revenues, Expenditures and
CITY OF NEW HOPE
General Fund
Budgeted Amounts
Changes in Fund Balances – Budget and Actual
For the Year Ended December 31, 2021
(With Comparative Actual Amounts for the Year Ended December 31, 2020)
-92-(continued)
Changes in Fund Balances – Budget and Actual (continued)
For the Year Ended December 31, 2021
(With Comparative Actual Amounts for the Year Ended December 31, 2020)
2020
Actual Over (Under)Actual
Original Final Amounts Budget Amounts
Expenditures (continued)
Current (continued)
General government (continued)
City manager
Personnel services 405,852 405,852 430,602 24,750 407,779
Supplies 1,600 1,600 593 (1,007) 1,233
Other services and charges 26,149 26,149 22,591 (3,558) 22,602
Total city manager 433,601 433,601 453,786 20,185 431,614
Elections
Personnel services – – – – 42,105
Supplies – – – – 6,738
Other services and charges 4,312 4,312 10,326 6,014 6,873
Total elections 4,312 4,312 10,326 6,014 55,716
Finance
Personnel services 181,334 181,334 174,759 (6,575) 190,816
Supplies 1,350 1,350 710 (640) 1,852
Other services and charges 75,984 75,984 103,071 27,087 92,648
Total finance 258,668 258,668 278,540 19,872 285,316
Auditing
Other services and charges 29,336 29,336 33,356 4,020 24,771
Assessing
Other services and charges 165,000 165,000 165,000 – 160,000
Legal
Other services and charges 22,000 22,000 16,901 (5,099) 29,429
Human resources
Personnel services 286,422 286,422 293,314 6,892 274,087
Supplies 450 450 570 120 228
Other services and charges 40,955 40,955 31,542 (9,413) 25,512
Total human resources 327,827 327,827 325,426 (2,401) 299,827
Planning and zoning
Personnel services 127,971 127,971 130,932 2,961 118,603
Supplies 300 300 414 114 478
Other services and charges 35,489 35,489 28,482 (7,007) 33,942
Total planning and zoning 163,760 163,760 159,828 (3,932) 153,023
Communication
Personnel services 106,121 106,121 104,241 (1,880) 89,320
Supplies 6,540 6,540 6,095 (445) 4,673
Other services and charges 53,416 53,416 33,913 (19,503) 20,187
Total communication 166,077 166,077 144,249 (21,828) 114,180
Total general government 2,056,129 2,056,129 2,148,125 91,996 2,061,733
Budgeted Amounts
2021
CITY OF NEW HOPE
General Fund
Schedule of Revenues, Expenditures and
-93-(continued)
Changes in Fund Balances – Budget and Actual (continued)
For the Year Ended December 31, 2021
(With Comparative Actual Amounts for the Year Ended December 31, 2020)
2020
Actual Over (Under)Actual
Original Final Amounts Budget Amounts
Expenditures (continued)
Current (continued)
Public safety
Police
Personnel services 5,668,240 5,668,240 5,025,038 (643,202) 4,997,575
Supplies 77,100 77,100 196,742 119,642 134,467
Other services and charges 1,188,131 1,188,131 1,233,360 45,229 1,091,335
Total police 6,933,471 6,933,471 6,455,140 (478,331) 6,223,377
Police reserves
Supplies 2,100 2,100 1,097 (1,003) 1,221
Other services and charges 14,315 14,315 8,612 (5,703) 22,267
Total police reserves 16,415 16,415 9,709 (6,706) 23,488
Fire and safety
Supplies 300 300 – (300) –
Other services and charges 1,440,491 1,440,491 1,418,843 (21,648) 1,423,808
Total fire and safety 1,440,791 1,440,791 1,418,843 (21,948) 1,423,808
Animal control
Personnel services 86,881 86,881 84,731 (2,150) 84,846
Supplies 475 475 262 (213) 99
Other services and charges 23,176 23,176 19,568 (3,608) 18,887
Total animal control 110,532 110,532 104,561 (5,971) 103,832
Protective inspection
Personnel services 540,271 540,271 512,720 (27,551) 506,212
Supplies 1,950 1,950 1,447 (503) 1,615
Other services and charges 94,974 94,974 88,741 (6,233) 87,970
Total protective inspection 637,195 637,195 602,908 (34,287) 595,797
Total public safety 9,138,404 9,138,404 8,591,161 (547,243) 8,370,302
Public works
Street maintenance
Personnel services 603,491 603,491 592,485 (11,006) 605,084
Supplies 142,350 142,350 99,238 (43,112) 116,525
Other services and charges 874,551 874,551 917,788 43,237 859,595
Total street maintenance 1,620,392 1,620,392 1,609,511 (10,881) 1,581,204
Engineering
Other services and charges 35,000 35,000 43,492 8,492 40,842
Total public works 1,655,392 1,655,392 1,653,003 (2,389) 1,622,046
CITY OF NEW HOPE
General Fund
Schedule of Revenues, Expenditures and
2021
Budgeted Amounts
-94-(continued)
Changes in Fund Balances – Budget and Actual (continued)
For the Year Ended December 31, 2021
(With Comparative Actual Amounts for the Year Ended December 31, 2020)
2020
Actual Over (Under)Actual
Original Final Amounts Budget Amounts
Expenditures (continued)
Current (continued)
Culture and recreation
Recreation
Personnel services 686,333 686,333 643,523 (42,810) 611,920
Supplies 117,350 117,350 84,108 (33,242) 90,638
Other services and charges 222,609 222,609 220,919 (1,690) 156,342
Total recreation 1,026,292 1,026,292 948,550 (77,742) 858,900
For the Year Ended December 31, 2021
Parks
Personnel services 669,313 669,313 647,953 (21,360) 595,900
Supplies 38,350 38,350 33,376 (4,974) 33,625
Other services and charges 425,397 425,397 446,244 20,847 401,333
Total parks 1,133,060 1,133,060 1,127,573 (5,487) 1,030,858
Swimming pool
Personnel services 497,247 497,247 331,813 (165,434) 115,135
Supplies 73,000 73,000 55,812 (17,188) 14,886
Other services and charges 185,952 185,952 165,705 (20,247) 15,879
Total swimming pool 756,199 756,199 553,330 (202,869) 145,900
Total culture and recreation 2,915,551 2,915,551 2,629,453 (286,098) 2,035,658
Total current expenditures 15,765,476 15,765,476 15,021,742 (743,734) 14,089,739
Capital outlay
General government 5,000 5,000 – (5,000) 674
Public safety 164,000 164,000 181,616 17,616 39,576
Culture and recreation 2,500 2,500 – (2,500) –
Total capital outlay 171,500 171,500 181,616 10,116 40,250
Total expenditures 15,936,976 15,936,976 15,203,358 (733,618) 14,129,989
Excess (deficiency) of
revenues over expenditures (450,675) (450,675) 932,718 1,383,393 1,447,095
Other financing sources (uses)
Transfers inSale of capital assets – – 6,800 6,800 –
Transfers in 450,675 450,675 450,672 (3) 339,288
Transfers out – – (1,642,533) (1,642,533) –
Total other financing sources (uses)450,675 450,675 (1,185,061) (1,635,736) 339,288
Net change in fund balances – – (252,343) (252,343) 1,786,383
Fund balances, January 1 8,926,086 8,926,086 8,926,086 – 7,139,703
Fund balances, December 31 8,926,086$ 8,926,086$ 8,673,743$ (252,343)$ 8,926,086$
CITY OF NEW HOPE
General Fund
Schedule of Revenues, Expenditures and
2021
Budgeted Amounts
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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
Internal Service Funds
Combining Statement of Net Position
December 31, 2021
9402 9408 9407 9410
Central Employee Insurance Information
Garage Leave Reserve Technology Totals
Assets
Current assets
Cash and temporary investments 7,012,636$ 1,912,109$ 561,751$ 514,992$ 10,001,488$
Receivables
Accounts – – 9,793 – 9,793
Inventories 64,202 – – – 64,202
Total current assets 7,076,838 1,912,109 571,544 514,992 10,075,483
Noncurrent assets
Capital assets
Land 85,647 – – – 85,647
Buildings and structures 3,158,296 – – – 3,158,296
Vehicles and equipment 10,166,942 – – 448,352 10,615,294
Construction in progress 7,559 – – – 7,559
Less accumulated depreciation (10,266,614) – – (335,694) (10,602,308)
Total capital assets
(net of accumulated depreciation)3,151,830 – – 112,658 3,264,488
Total assets 10,228,668 1,912,109 571,544 627,650 13,339,971
Deferred outflows of resources
Deferred pension resources 117,169 – – – 117,169
Liabilities
Current liabilities
Accrued salaries payable 14,609 40,150 97,777 854 153,390
Accounts and contracts payable 38,704 – 8,917 23,776 71,397
Due to other governments 673 – – – 673
Compensated absences payable,
current portion – 87,509 – – 87,509
Leases payable, current portion 28,682 – – – 28,682
Total current liabilities 82,668 127,659 106,694 24,630 341,651
Noncurrent liabilities
OPEB payable – – 799,276 – 799,276
Pension liability 159,757 – – – 159,757
Compensated absences payable – 787,580 – – 787,580
Leases payable 83,694 – – – 83,694
Total noncurrent liabilities 243,451 787,580 799,276 – 1,830,307
Total liabilities 326,119 915,239 905,970 24,630 2,171,958
Deferred inflows of resources
Deferred pension resources 146,836 – – – 146,836
Net position
Net investment in capital assets 3,039,454 – – 112,658 3,152,112
Unrestricted 6,833,428 996,870 (334,426) 490,362 7,986,234
Total net position 9,872,882$ 996,870$ (334,426)$ 603,020$ 11,138,346$
-96-
9402 9408 9407 9410
Central Employee Insurance Information
Garage Leave Reserve Technology Totals
Operating revenues
Billings to departments 2,255,832$ 726,101$ 54,801$ 884,772$ 3,921,506$
Other 63,376 – 185,496 – 248,872
Total operating revenues 2,319,208 726,101 240,297 884,772 4,170,378
Operating expenses
Personnel services 339,882 525,388 – 1,107 866,377
Supplies 241,981 – – 27,747 269,728
Utilities 70,126 – – 51,705 121,831
Other services and charges 391,933 – 56,348 626,395 1,074,676
Depreciation 556,424 – – 15,390 571,814
Total operating expenses 1,600,346 525,388 56,348 722,344 2,904,426
Operating income (loss)718,862 200,713 183,949 162,428 1,265,952
Nonoperating revenues (expenses)
Investment earnings (charges)(55,491) – – (1,652) (57,143)
Gain on sale of capital assets 63,500 – – – 63,500
Interest expense (33) – – – (33)
Total nonoperating revenues (expenses)7,976 – – (1,652) 6,324
Income before transfers 726,838 200,713 183,949 160,776 1,272,276
Transfers out (1,686,504) – – (214,416) (1,900,920)
Change in net position (959,666) 200,713 183,949 (53,640) (628,644)
Net position, January 1 10,832,548 796,157 (518,375) 656,660 11,766,990
Net position, December 31 9,872,882$ 996,870$ (334,426)$ 603,020$ 11,138,346$
For the Year Ended December 31, 2021
Changes in Net Position
Combining Statement of Revenues, Expenses and
Internal Service Funds
CITY OF NEW HOPE
-97-
9402 9408 9407 9410
Central Employee Insurance Information
Garage Leave Reserve Technology Totals
Cash flows from operating activities
Receipts from interfund services provided 2,255,832$ 726,101$ 52,449$ 884,772$ 3,919,154$
Other operating receipts 63,376 – 185,496 – 248,872
Payments to suppliers (721,090) – (105,745) (691,066) (1,517,901)
Payments to employees (354,261) (487,350) (196,289) (253) (1,038,153)
Net cash from operating activities 1,243,857 238,751 (64,089) 193,453 1,611,972
Cash flows from noncapital financing activities
Transfers out (1,686,504) – – (214,416) (1,900,920)
Cash flows from capital and related financing activities
Acquisition capital assets (832,437) – – (45,933) (878,370)
Proceeds from sale of assets 63,500 – – – 63,500
Principal paid on long-term debt (2,352) – – – (2,352)
Interest paid on long-term debt (33) – – – (33)
Net cash from capital and
related financing activities (771,322) – – (45,933) (817,255)
Investment earnings (charges)(55,491) – – (1,652) (57,143)
Net increase in cash and cash equivalents (1,269,460) 238,751 (64,089) (68,548) (1,163,346)
Cash and cash equivalents, January 1 8,282,096 1,673,358 625,840 583,540 11,164,834
Cash and cash equivalents, December 31 7,012,636$ 1,912,109$ 561,751$ 514,992$ 10,001,488$
Reconciliation of operating income
to net cash from operating activities
Operating income 718,862$ 200,713$ 183,949$ 162,428$ 1,265,952$
Adjustments to reconcile operating income
to net cash from operating activities
Depreciation 556,424 – – 15,390 571,814
(Increase) decrease in assets
Accounts receivable – – (2,352) – (2,352)
Inventories 3,833 – – – 3,833
(Increase) decrease in deferred
outflows of resources
Deferred pension resources (93,397) – – – (93,397)
Deferred OPEB resources – – 167,973 – 167,973
Increase (decrease) in liabilities
Accounts and contracts payable (20,925) – (49,397) 14,781 (55,541)
Accrued salaries payable 3,135 6,405 (19,872) 854 (9,478)
Due to other governments 42 – – – 42
Compensated absences payable – 31,633 – – 31,633
OPEB payable – – (311,187) – (311,187)
Pension liability (62,055) – – – (62,055)
Increase (decrease) in deferred
inflows of resources
Deferred pension resources 137,938 – – – 137,938
Deferred OPEB resources – – (33,203) – (33,203)
Net cash from operating activities 1,243,857$ 238,751$ (64,089)$ 193,453$ 1,611,972$
Schedule of noncash capital and related
financing activities
Capital assets acquired through leases payable 114,728$ –$ –$ –$ 114,728$
CITY OF NEW HOPE
Cash flows from investing activities
For the Year Ended December 31, 2021
Combining Statement of Cash Flows
Internal Service Funds
-98-
STATISTICAL SECTION (UNAUDITED)
CITY OF NEW HOPE, MINNESOTA
FOR THE YEAR ENDED
DECEMBER 31, 2021
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Contents:
Financial Trends
Revenue Capacity
Debt Capacity
Demographic and Economic Information
Operating Indicators
Source: Unless otherwise noted, the information in these schedules is derived from the ACFR for the relevant year.
STATISTICAL SECTION (UNAUDITED)
This part of the City of New Hope,Minnesota’s (the City) Annual Comprehensive Financial Report (ACFR) 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.
These schedules contain trend information to help the reader understand how the City’s financial performance and
well-being have changed over time.
These schedules contain information to help the reader assess the City’s most significant revenue source, including the
property tax and utility revenue.
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.
These schedules offer demographic and economic indicators to help the reader understand the environment within which
the City’s financial activities take place.
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.
Fiscal Year
2012 2013 2014 2015
Governmental activities
Net investment in capital assets 26,793,142$ 30,509,373$ 26,305,906$ 27,549,276$
Restricted 1,619,696 1,619,394 5,680,117 5,917,848
Unrestricted 22,746,207 23,704,592 23,130,558 14,623,043
Total governmental activities net position 51,159,045$ 55,833,359$ 55,116,581$ 48,090,167$
Business-type activities
Net investment in capital assets 12,843,624$ 14,142,276$ 14,757,333$ 16,087,559$
Restricted 150,000 300,000 455,000 627,939
Unrestricted 2,735,144 2,496,008 1,798,707 (825,297)
Total business-type activities net position 15,728,768$ 16,938,284$ 17,011,040$ 15,890,201$
Primary government
Net investment in capital assets 39,636,766$ 44,651,649$ 41,063,239$ 43,636,835$
Restricted 1,769,696 1,919,394 6,135,117 6,545,787
Unrestricted 25,481,351 26,200,600 24,929,265 13,797,746
Total primary government net position 66,887,813$ 72,771,643$ 72,127,621$ 63,980,368$
Note 1:
Note 2:
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.
CITY OF NEW HOPE
Net Position by Component
Last Ten Fiscal Years
(Accrual Basis of Accounting)
-99-
2016 2017 2018 2019 2020 2021
29,951,754$ 27,747,845$ 27,888,417$ 30,139,510$ 31,359,813$ 34,985,781$
4,893,801 6,207,578 6,000,843 6,628,138 7,740,859 8,598,311
11,081,824 11,728,807 14,384,257 16,720,142 19,716,696 23,427,177
45,927,379$ 45,684,230$ 48,273,517$ 53,487,790$ 58,817,368$ 67,011,269$
19,286,134$ 18,663,872$ 18,783,898$ 19,315,353$ 20,127,288$ 22,607,046$
868,853 1,031,673 1,160,680 1,358,401 1,560,053
(1,839,376) 84,741 1,783,306 3,054,187 4,534,420 6,455,200
18,315,611$ 19,780,286$ 21,727,884$ 23,727,941$ 26,221,761$ 29,062,246$
49,237,888$ 46,411,717$ 46,672,315$ 49,454,863$ 51,487,101$ 57,592,827$
5,762,654 7,239,251 7,161,523 7,986,539 9,300,912 8,598,311
9,242,448 11,813,548 16,167,563 19,756,329 24,251,116 29,882,377
64,242,990$ 65,464,516$ 70,001,401$ 77,197,731$ 85,039,129$ 96,073,515$
-100-
Fiscal Year
2012 2013 2014 2015
Expenses
Governmental activities
General government 1,931,318$ 1,837,194$ 1,976,377$ 1,700,133$
Public safety 6,062,362 6,238,779 6,795,836 7,258,504
Public works 2,126,043 1,790,669 2,467,618 4,229,077
Culture and recreation 1,928,591 1,946,243 2,145,224 2,223,152
Economic development 762,202 431,332 1,704,010 655,093
Interest and fiscal charges 407,744 289,009 140,321 269,284
Total governmental activities expenses 13,218,260 12,533,226 15,229,386 16,335,243
Business-type activities
Sewer 2,220,438 2,310,604 1,976,864 2,458,724
Water 3,682,602 3,215,714 4,635,686 4,584,929
Golf course 298,555 262,894 304,059 291,695
Ice arena 771,628 957,784 877,826 880,581
Storm water 425,112 768,610 558,160 713,218
Street lighting 104,721 117,518 99,560 105,452
Total business-type activities expenses 7,503,056 7,633,124 8,452,155 9,034,599
Total primary government expenses 20,721,316$ 20,166,350$ 23,681,541$ 25,369,842$
Program revenues
Governmental activities
Charges for services
General government 177,174$ 198,297$ 234,440$ 254,333$
Public safety 804,725 880,843 1,047,721 1,073,079
Public works 219,548 226,228 224,790 219,634
Culture and recreation 653,293 672,067 617,459 668,480
Economic development 94,664 – – –
Operating grants and contributions 2,162,263 828,276 1,013,058 845,517
Capital grants and contributions 245,290 3,929,565 47,917 460,537
Total governmental activities program
revenues 4,356,957 6,735,276 3,185,385 3,521,580
Business-type activities
Charges for services
Sewer utility 2,376,021 2,443,202 2,414,482 2,468,638
Water utility 3,581,225 3,460,008 3,634,873 3,777,108
Golf course 296,316 268,133 254,508 287,056
Ice arena 694,702 725,211 775,784 745,886
Storm water 948,650 963,167 948,537 981,723
Street lighting 124,397 125,604 123,060 128,890
Operating grants and contributions 22,340 306,520 444,484 33,032
Capital grants and contributions 106,291 225,300 11,469 194,590
Total business-type activities program
revenues 8,149,942 8,517,145 8,607,197 8,616,923
Total primary government program revenues 12,506,899$ 15,252,421$ 11,792,582$ 12,138,503$
CITY OF NEW HOPE
Changes in Net Position
Last Ten Fiscal Years
(Accrual Basis of Accounting)
-101-
2016 2017 2018 2019 2020 2021
1,871,736$ 2,666,781$ 1,983,179$ 1,850,242$ 2,945,625$ 1,152,633$
9,463,124 8,257,709 7,578,150 8,540,198 8,968,009 7,764,051
3,143,421 2,975,007 3,661,766 3,816,417 3,725,075 4,295,427
2,405,905 2,485,417 2,280,418 2,145,988 2,270,751 3,095,760
732,106 2,163,967 1,244,292 749,651 1,350,348 1,434,986
323,326 725,982 1,074,469 1,412,763 1,570,807 1,518,351
17,939,618 19,274,863 17,822,274 18,515,259 20,830,615 19,261,208
2,187,006 2,399,248 2,631,598 2,834,973 3,096,526 2,973,301
3,633,022 3,504,722 4,038,859 3,762,099 4,195,981 4,813,286
341,776 322,278 299,217 319,871 316,173 368,659
949,438 996,056 987,912 1,003,048 1,016,296 1,095,343
830,108 834,688 736,166 888,156 877,244 991,031
102,894 101,668 119,250 116,732 133,270 135,899
8,044,244 8,158,660 8,813,002 8,924,879 9,635,490 10,377,519
25,983,862$ 27,433,523$ 26,635,276$ 27,440,138$ 30,466,105$ 29,638,727$
267,970$ 340,421$ 250,575$ 223,379$ 217,183$ 270,287$
1,035,725 1,302,551 935,116 880,634 736,004 832,767
220,208 234,564 228,660 226,249 234,121 235,879
699,613 686,335 570,143 529,739 316,820 996,447
20,000 41,112 – – – –
1,002,681 777,368 967,499 826,489 866,861 1,093,760
711,527 1,150,840 941,212 2,819,823 1,048,750 720,699
3,957,724 4,533,191 3,893,205 5,506,313 3,419,739 4,149,839
2,627,875 2,899,257 3,154,709 3,380,075 3,712,613 3,906,809
4,124,346 4,289,255 4,696,593 4,675,498 5,468,607 5,882,735
315,162 283,375 298,696 296,538 423,766 473,508
749,689 849,701 864,531 892,740 601,291 925,967
1,037,429 1,082,348 1,139,007 1,190,058 1,259,707 1,321,518
137,525 137,491 144,582 152,975 161,866 170,656
159,898 27,568 327,335 14,308 110,331 146,755
1,394,822 58,237 14,203 28,824 12,922 13,475
10,546,746 9,627,232 10,639,656 10,631,016 11,751,103 12,841,423
14,504,470$ 14,160,423$ 14,532,861$ 16,137,329$ 15,170,842$ 16,991,262$
-102-(continued)
Fiscal Year
2012 2013 2014 2015
Net (expense) revenue
Governmental activities (8,861,303)$ (5,797,950)$ (12,044,001)$ (12,813,663)$
Business-type activities 646,886 884,021 155,042 (417,676)
Total primary government net expense (8,214,417)$ (4,913,929)$ (11,888,959)$ (13,231,339)$
General revenues and other changes in net position
Governmental activities
Property taxes 9,129,247$ 9,554,629$ 9,732,776$ 10,131,759$
Tax increments 1,343,248 511,924 537,871 430,879
Franchise taxes 440,149 438,834 438,541 442,556
Grants and contributions not restricted
to specific programs 47,662 49,005 179,537 600,030
Unrestricted investment earnings (charges)429,595 198,658 324,498 331,417
Gain on sale of capital assets 69,321 37,201 – –
Transfers 68,971 (317,987) 114,000 68,204
Total governmental activities 11,528,193 10,472,264 11,327,223 12,004,845
Business-type activities
Unrestricted investment earnings 57,384 7,508 31,714 35,700
Transfers (68,971) 317,987 (114,000) (68,204)
Total business-type activities (11,587) 325,495 (82,286) (32,504)
Total primary government 11,516,606$ 10,797,759$ 11,244,937$ 11,972,341$
Changes in net position
Governmental activities 2,666,890$ 4,674,314$ (716,778)$ (808,818)$
Business-type activities 635,299 1,209,516 72,756 (450,180)
Total primary government 3,302,189$ 5,883,830$ (644,022)$ (1,258,998)$
Note:The City implemented GASB Statement Nos.67 and 68 in fiscal 2015.The City implemented GASB Statement No.75 in
fiscal 2018. Information has not been restated for prior years.
Last Ten Fiscal Years
(Accrual Basis of Accounting)
CITY OF NEW HOPE
Changes in Net Position (continued)
-103-
2016 2017 2018 2019 2020 2021
(13,981,894)$ (14,741,672)$ (13,929,069)$ (13,008,946)$ (17,410,876)$ (15,111,369)$
2,502,502 1,468,572 1,826,654 1,706,137 2,115,613 2,463,904
(11,479,392)$ (13,273,100)$ (12,102,415)$ (11,302,809)$ (15,295,263)$ (12,647,465)$
10,843,702$ 11,929,597$ 12,941,920$ 15,265,428$ 16,821,240$ 17,357,910$
492,584 841,098 1,112,753 1,317,803 1,918,857 2,118,199
447,248 912,357 945,244 957,448 958,162 962,395
633,056 628,119 697,895 803,035 2,497,630 3,155,397
377,960 531,240 798,557 1,412,308 781,304 (22,179)
– 50,456 70,400 369,163 22,000 70,300
121,800 (19,110) (48,413) (144,624) (240,739) (336,752)
12,916,350 14,873,757 16,518,356 19,980,561 22,758,454 23,305,270
44,708 36,811 72,531 149,296 137,468 39,829
(121,800) 19,110 48,413 144,624 240,739 336,752
(77,092) 55,921 120,944 293,920 378,207 376,581
12,839,258$ 14,929,678$ 16,639,300$ 20,274,481$ 23,136,661$ 23,681,851$
(1,065,544)$ 132,085$ 2,589,287$ 6,971,615$ 5,347,578$ 8,193,901$
2,425,410 1,524,493 1,947,598 2,000,057 2,493,820 2,840,485
1,359,866$ 1,656,578$ 4,536,885$ 8,971,672$ 7,841,398$ 11,034,386$
-104-
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Ad Valorem
Property Taxes Tax Increments Franchise Taxes Total
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
17,357,910 2,118,199 962,395 20,438,504
CITY OF NEW HOPE
Governmental Activities Tax Revenues by Source
Last Ten Fiscal Years
(Accrual Basis of Accounting)
Fiscal Year
2016
2012
2013
2014
2015
2017
2018
2019
2020
2021
-105-
Fiscal Year
2012 2013 2014 2015
General Fund
Nonspendable 14,925$ 15,484$ 16,005$ 16,765$
Unassigned 5,080,812 5,567,933 5,805,259 6,063,647
Total General Fund 5,095,737$ 5,583,417$ 5,821,264$ 6,080,412$
All other governmental funds
Restricted –$ –$ 5,687,949$ 8,069,238$
Committed 5,657,606 5,550,819 4,771,304 5,431,288
Assigned 5,165,192 4,511,073 7,839,792 5,496,484
Unassigned 6,533,868 8,204,338 (134,792) (226,356)
Total all other governmental funds 17,356,666$ 18,266,230$ 18,164,253$ 18,770,654$
Total all governmental funds 22,452,403$ 23,849,647$ 23,985,517$ 24,851,066$
CITY OF NEW HOPE
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
-106-
``
2016 2017 2018 2019 2020 2021
18,242$ 17,617$ 18,763$ 22,980$ 24,499$ 49,680$
6,255,436 6,871,038 7,162,188 7,116,723 8,901,587 8,624,063
6,273,678$ 6,888,655$ 7,180,951$ 7,139,703$ 8,926,086$ 8,673,743$
7,772,782$ 24,605,109$ 24,646,820$ 13,304,922$ 9,016,306$ 9,779,064$
5,397,075 5,837,809 5,414,740 5,033,555 4,639,390 4,520,972
4,958,094 5,176,318 5,695,269 6,248,128 6,993,400 9,059,040
(3,015,315) (4,178,684) (3,448,208) (2,475,320) (2,119,931) (1,978,033)
15,112,636$ 31,440,552$ 32,308,621$ 22,111,285$ 18,529,165$ 21,381,043$
21,386,314$ 38,329,207$ 39,489,572$ 29,250,988$ 27,455,251$ 30,054,786$
-107-
Fiscal Year
2012 2013 2014 2015
Revenues
Property taxes 9,199,381$ 9,531,663$ 9,718,800$ 10,145,204$
Tax increments 1,343,248 511,924 537,871 430,879
Franchise taxes 440,149 438,834 438,541 442,556
Licenses and permits 238,943 273,117 353,973 389,957
Intergovernmental 858,816 4,463,113 818,825 1,359,511
Charges for services 1,557,898 1,585,964 1,663,153 1,601,081
Fines and forfeits 283,233 239,201 215,585 237,591
Special assessments 305,818 178,335 98,617 38,417
Investment income 307,032 178,217 248,013 274,116
Miscellaneous 80,073 111,443 129,980 202,057
Total revenues 14,614,591 17,511,811 14,223,358 15,121,369
Expenditures
General government 1,567,301 1,571,701 1,668,474 1,688,752
Public safety 5,946,209 5,967,599 6,397,860 6,866,105
Public works 1,192,760 1,254,201 1,225,551 1,328,371
Culture and recreation 1,599,041 1,613,518 1,761,961 1,853,741
Economic development 304,064 582,621 298,825 498,479
Capital outlay 7,685,819 4,239,938 3,000,518 8,204,694
Debt service
Principal retirement 330,000 340,000 350,000 405,000
Interest 270,613 306,462 212,025 131,530
Bond issuance 104,351 – 2,200 114,607
Total expenditures 19,000,158 15,876,040 14,917,414 21,091,279
Excess of revenues
over (under) expenditures (4,385,567) 1,635,771 (694,056) (5,969,910)
Other financing sources (uses)
Transfers in 936,188 360,427 669,461 3,209,226
Sale of capital assets – 1,460 4,055,382 –
Bonds issued – – – –
Premiums on debt issues 54,006 – – 171,339
Refunding bonds issued 4,025,000 – – 6,470,000
Payments to refunded bond escrow agent – – (3,780,000) –
Transfers (out)(770,638) (600,414) (477,461) (3,015,226)
Total other financing sources (uses)4,244,556 (238,527) 467,382 6,835,339
Net change in fund balances (141,011)$ 1,397,244$ (226,674)$ 865,429$
Debt service as a percentage of noncapital
expenditures 4.1% 5.6% 4.5% 3.5%
CITY OF NEW HOPE
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
-108-
2016 2017 2018 2019 2020 2021
10,868,985$ 11,961,711$ 12,904,297$ 15,223,680$ 16,756,108$ 17,452,708$
492,584 841,098 1,112,753 1,317,803 1,918,857 2,118,199
447,248 912,357 945,244 957,448 958,162 962,395
466,548 641,870 367,931 320,438 393,911 399,087
2,063,546 1,844,648 2,195,761 3,947,039 4,289,738 3,253,349
1,571,798 1,727,615 1,399,998 1,376,176 986,887 1,778,180
191,960 208,909 230,657 227,343 138,922 185,603
173,158 92,458 282,589 197,566 234,265 142,413
304,252 486,746 658,606 1,166,238 607,490 34,964
42,103 137,591 33,966 173,679 26,700 185,564
16,622,182 18,855,003 20,131,802 24,907,410 26,311,040 26,512,462
1,872,436 2,622,277 1,787,553 1,900,480 2,062,733 2,148,125
7,168,102 7,724,950 7,997,311 8,427,939 8,361,209 8,591,161
1,606,369 1,671,593 1,717,815 1,790,715 1,853,395 1,897,270
1,938,131 2,066,692 2,015,729 2,032,585 2,035,658 2,629,453
588,167 1,737,947 815,352 513,946 1,291,350 1,337,525
8,220,964 5,217,461 12,956,485 22,573,850 8,669,758 4,612,615
415,000 523,497 799,734 968,674 1,905,890 2,548,885
257,661 455,539 769,497 1,273,302 1,778,653 1,455,861
58,188 251,648 148,365 90,446 – 263,000
22,125,018 22,271,604 29,007,841 39,571,937 27,958,646 25,483,895
(5,502,836) (3,416,601) (8,876,039) (14,664,527) (1,647,606) 1,028,567
1,630,270 4,305,261 788,458 2,162,676 418,661 5,784,869
– – – 331,299 – 6,800
2,824,075 18,435,000 9,520,000 5,235,000 – –
107,553 1,857,609 476,673 454,261 – –
– – – – – –
– – – – – –
(1,426,570) (4,238,376) (748,726) (1,981,951) (566,792) (4,220,701)
3,135,328 20,359,494 10,036,405 6,201,285 (148,131) 1,570,968
(2,367,508)$ 16,942,893$ 1,160,366$ (8,463,242)$ (1,795,737)$ 2,599,535$
4.6% 5.4% 9.2% 12.6% 18.7% 18.5%
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Ad Valorem
Property Tax Tax Increments Franchise Tax Total
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
17,452,708 2,118,199 962,395 20,533,302
CITY OF NEW HOPE
General Governmental Tax Revenues by Source
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
Fiscal Year
2016
2012
2013
2014
2015
2017
2018
2019
2020
2021
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Contributions Less Distributions
Real Personal Total To Fiscal Tax From Fiscal
Property Property Tax Capacity Disparities Increments Disparities
16,686,171$ 165,812$ 16,851,983$ (2,380,423)$ (944,560)$ 3,605,075$
15,476,014 188,654 15,664,668 (2,255,476) (366,752) 3,448,346
15,454,712 211,746 15,666,458 (2,154,731) (377,138) 3,437,911
16,638,481 221,628 16,860,109 (2,144,256) (338,715) 3,505,922
17,898,058 226,510 18,124,568 (2,277,639) (362,633) 3,437,652
19,196,854 242,052 19,438,906 (2,464,382) (604,222) 3,757,080
21,143,125 260,678 21,403,803 (2,655,561) (810,429) 4,010,408
22,506,796 275,032 22,781,828 (2,870,420) (948,691) 4,111,736
25,019,326 276,748 25,296,074 (2,941,213) (1,378,781) 4,385,923
27,035,066 303,741 27,338,807 (3,317,874) (1,565,751) 4,630,371
Note:
Source:
CITY OF NEW HOPE
Tax Capacity, Market Value, and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
Tax Capacity
Fiscal Year
Levy
Collective in
Property in the county is reassessed annually.
Hennepin County Auditor/Treasure Department
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
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Total Direct Estimated
Net Tax Capacity Taxable Actual
Tax Capacity Rate Market Value Market Value
17,132,075$ 57.326 1,329,979,513$ 1,438,796,300$ 92.44 %
16,490,786 58.812 1,223,862,183 1,336,539,900 91.57
16,572,500 58.599 1,235,267,314 1,346,449,200 91.74
17,883,060 55.978 1,334,517,728 1,440,652,000 92.63
18,921,948 57.405 1,430,939,117 1,534,397,300 93.26
20,127,382 59.931 1,535,054,114 1,636,865,900 93.78
21,948,221 58.589 1,697,092,365 1,792,927,900 94.65
23,074,453 67.990 1,831,436,951 1,921,182,700 95.33
25,362,003 66.089 2,021,382,123 2,106,273,300 95.97
27,085,553 63.940 2,177,389,934 2,257,016,100 96.47
Value as a
Taxable Market
Tax Capacity
Actual Value
Estimated
Percentage of
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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
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
50.186 13.754 – 63.940 38.210 25.529 8.597 136.276
Note:
Source:Hennepin County
2012
2017
CITY OF NEW HOPE
Property Tax Rates
Direct and Overlapping Governments
Last Ten Fiscal Years
Year
Overlapping RatesDirect Rates – City of New Hope
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
2021
2018
2019
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Net Tax Net Tax
Capacity Rank Capacity Rank
Alatus New Hope, LLC 469,225$ 1 1.7 %–$ – – %
STNL (New Hope), LLC 278,650 2 1.0 – – –
Allen Group, LLC 232,650 3 0.9 – – –
FLS Properties 232,010 4 0.9 159,250 1 0.9
Padagis US LLC 220,730 5 0.8 – – –
Broadway Lanel/Golle/Holmes 216,788 6 0.8 – – –
Omega Healthcare Investors 214,388 7 0.8 – – –
Saint Therese Home of New Hope 213,268 8 0.8 153,138 2 0.9
Lang Nelson Association 210,850 9 0.8 – – –
CI Minn I-A, LLC 209,250 10 0.8 – – –
Paddock Properties, Limited Partnership – – – 151,890 3 0.9
Cobalt Industrial Reit – – – 143,850 4 0.8
Geneva Management Services, LLC – – – 143,250 5 0.8
New Hope Distribution Center, LLC – – – 139,250 6 0.8
Long Ridge Industrial Portfolio – – – 135,250 7 0.8
Roland A. Stinski – – – 135,250 7 0.8
Minnesota Masonic Home/
NorthRidge Care Center – – – 133,450 9 0.8
New Hope/US Swim Partnership – – – 131,250 10 0.8
Total 2,497,809$ 9.3 %1,425,828$ 8.3 %
Source:Hennepin County/Treasurer Department
Applied Tax
CapacityTaxpayerCapacity
Applied Tax
Current Year and Nine Years Ago
Principal Property Taxpayers
CITY OF NEW HOPE
Percentage of
2021 2012
Percentage of
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Total Tax Collections in
Levy for Subsequent
Fiscal Year Amount (2)Years (3)Amount
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 75,797 10,093,297 99.91
10,813,013 10,756,992 99.48 53,622 10,810,614 99.98
11,967,401 11,895,137 99.40 68,290 11,963,427 99.97
12,912,742 12,834,660 99.40 63,168 12,897,828 99.88
15,301,610 15,172,300 99.15 101,587 15,273,887 99.82
16,844,871 16,662,434 98.92 152,040 16,814,474 99.82
17,418,008 17,376,787 99.76 – 17,376,787 99.76
(1)
(2)
(3)
Collected Within the
CITY OF NEW HOPE
Fiscal Year
of Levy
Percentage
Fiscal Year of the Levy
2019
2018
Total Collections to Date
Property Tax Levies and Collections (1)
2017
2015
Last Ten Fiscal Years
of Levy
Ended
2013
2012
2016
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.
2021
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General G.O. Tax Lease General
Obligation Increment Revenue Obligation
Bonds Bonds Total Bonds Bonds
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
36,026,448 6,194,936 42,221,384 – 4,897,991
(1)
Note:
CITY OF NEW HOPE
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
2021
Activities
Fiscal Year
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G.O.G.O. Tax
Revenue Increment Total Primary
Bonds Bonds Total Government Per Capita (1)
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 3.46 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 3.22 2,463
889,935 1,210,406 6,998,332 49,219,716 2.83 2,239
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
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 2,131
49,219,716 2,503,260 46,716,456 2.070 2,125
Note 1:
Note 2:
Note 3:
CITY OF NEW HOPE
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years
Taxable Value
Estimated Actual
Percentage of
Fiscal Year
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
2021
See the Schedule of Tax Capacity,Market Value,and Estimated Actual Value of Taxable Property for property
value data.
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Estimated
Share of
Debt Overlapping
Outstanding Debt
Direct debt
City of New Hope*36,026,448$ 100.00 %36,026,448$
Overlapping debt
Hennepin County 1,037,033,516 1.09 11,303,665
ISD No. 281, Robbinsdale 182,380,501 19.60 35,746,578
Three Rivers Park District 45,542,541 1.56 710,464
Hennepin Regional RR Authority 89,332,530 1.09 973,725
Metropolitan Council 73,049,600 0.53 387,163
Total overlapping debt 1,427,338,688$ 49,121,595
Total direct and overlapping debt 85,148,043$
* Excludes debt payable from tax increment revenue and enterprise revenue.
CITY OF NEW HOPE
Direct and Overlapping Governmental Activities Debt
as of December 31, 2021
Estimated
Percentage
Governmental Unit
Source:
Applicable (1)
Note:
(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.
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
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Fiscal Year
2012 2013 2014 2015
Debt limit 39,899,385$ 36,715,865$ 37,058,019$ 40,035,532$
Total net debt applicable to the limit 970,908 839,948 696,627 2,719,528
Legal debt margin 38,928,477$ 35,875,917$ 36,361,392$ 37,316,004$
Total net debt applicable to the limit
as a percentage of the debt limit 2.43% 2.29% 1.88% 6.79%
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
Legal Debt Margin Information
Last Ten Fiscal Years
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2016 2017 2018 2019 2020 2021
42,928,174$ 46,051,623$ 50,912,771$ 54,943,109$ 60,641,464$ 65,321,698$
5,497,493 25,516,878 34,249,431 38,595,992 36,361,673 33,238,704
37,430,681$ 20,534,745$ 16,663,340$ 16,347,117$ 24,279,791$ 32,082,994$
12.81% 55.41% 67.27% 70.25% 59.96% 50.88%
Market value 2,177,389,934$
Debt limit (3 percent of market value)65,321,698
Debt applicable to limit
General obligation bonds 36,026,448
Less amount available in debt service funds (2,787,744)
Total net debt applicable to the limit 33,238,704
Legal debt margin 32,082,994$
Legal Debt Margin Calculation for Fiscal Year 2021
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(1)(2)Net
Gross Operating Available
Revenue Expenses Revenue Principal (4)Interest
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 97,854 037.87
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
12,227,593 8,563,424 3,664,169 2,197,368 166,584 1.55
(1)
(2)Operating expenses exclude depreciation.
(3)Revenues and expense include the Storm Water, Water Utility, Sewer Utility, and Ice Arena funds.
(4)Excludes principal paid with refunding bond proceeds.
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
2016
2015
2021
Last Ten Fiscal Years
Pledged Revenue Coverage
CITY OF NEW HOPE
2019
2020
2018
Fiscal Year
Debt Service
Coverage
Revenue Bonds (3)
2014
2013
2012
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Per Capita
Personal Personal Median School
Population (1)Income (2)Income (3)Age (4)Enrollment (5)
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
21,986 76,552 1,683,072,272 36.4 12,397 8.6
21,986 79,183 1,740,917,438 36.4 12,319 2.3
(1)Provided by the Metropolitan Council. The most recent year is an estimate.
(2)
(3)
(4)
(5)
(6)
Sources:
CITY OF NEW HOPE
Rate (6)
UnemploymentFiscal
Demographic and Economic Statistics
Last Ten Fiscal Years
Year
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.
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 Hennepin County.
2017
2018
2019
2020
2021
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Employees Rank Employees Rank
ISD No. 281, Robbinsdale 1,852 1 15.7 %2,200 1 24.6 %
Hy-Vee, Inc.632 2 5.3 – – –
Minnesota Masonic Home/
North Ridge Care Center 560 3 – 789 2 8.8
Saint Therese Home of New Hope 544 4 4.6 650 3 7.3
Horwitz 345 5 2.9 – – –
Perrigo Company 323 6 2.7 413 4 4.6
Intermediate District 287 266 7 2.2 – – –
City of New Hope 262 8 2.2 – – –
YMCA 228 9 1.9 – – –
Liberty Diversified International 200 10 1.7 200 7 2.2
Welsh Navarre MN, LLC – – – 280 5 3.1
Coborn’s Delivers – – – 240 6 2.7
Dakota Growers Pasta – – – 200 8 2.2
Waymouth Farms, Inc – – – 137 9 1.5
Parker – Hannifin Oildyne Division – – – 135 10 1.5
5,212 39.2 %5,244 58.6 %
Source:Minnesota Department of Employment and Economic Development
Employer Employment
CITY OF NEW HOPE
Employment
of Total City
Percentage
2012
Percentage
Current Year and Nine Years Ago
2021
of Total City
Principal Employers
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Fiscal Year
2012 2013 2014 2015
Function
General government 15 16 14 13
Public safety
Police
Officers 30 31 33 35
Civilians 7 7 7 9
Public works 24 24 24 23
Culture and recreation 6 7 7 7
Total 82 85 85 87
Source: Various city departments
CITY OF NEW HOPE
Full-Time Equivalent City Government Employees by Function
Last Ten Fiscal Years
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``
2016 2017 2018 2019 2020 2021
13 16 17 17 17 17
33 34 34 34 34 33
9 10 11 10 10 9
24 24 24 24 24 24
8 7 7 7 8 8
87 91 93 92 93 91
-126-
Fiscal Year
2012 2013 2014 2015
Function
– – – 12
687 600 1,330 2,882
Culture and recreation
5,598 4,565 3,121 2,746
5,323 7,442 5,734 5,815
148,966 144,000 122,478 124,777
Golf course
Rounds of golf at the municipal course 19,568 16,782 16,431 18,175
Ice arena
Hours of ice time rental 3,558 3,739 3,734 3,683
Water
Water main breaks 26 30 27 21
Average daily consumption
(thousands of gallons)1,828 1,682 1,571 1,559
Sewer
Average daily treatment (thousands of gallons)2,189 1,500 2,200 1,670
Note:Indicators are not available for the general government function.
Source:Various city departments
CITY OF NEW HOPE
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
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2016 2017 2018 2019 2020 2021
3 3 3 4 4 3
3,025 2,530 3,000 2,900 2,900 2,900
3,343 3,011 2,603 1,860 1,426 2,305
6,043 5,969 5,413 4,695 3,325 4,785
127,865 127,112 102,659 101,409 69,415 144,455
20,375 18,662 17,800 16,837 26,553 27,654
3,567 4,030 4,151 4,202 2,984 4,416
19 12 23 14 18 28
1,588 1,616 1,616 1,551 1,775 1,845
1,800 1,352 1,405 1,355 1,451 1,473
-128-
Fiscal Year
2012 2013 2014 2015
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
CITY OF NEW HOPE
Capital Asset Statistics by Function
Last Ten Fiscal Years
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2016 2017 2018 2019 2020 2021
1 1 1 1 1 1
3 3 3 3 3 3
64.0 64.0 64.0 64.0 64.8 64.8
8.5 8.5 8.5 8.5 8.5 8.5
26.4 27.0 27.0 27.0 27.3 27.3
619.0 619.0 619.0 630.0 630.0 630.0
2.0 2.0 2.0 2.0 2.0 98.0
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 9
64 64 64 64 65 65
690 690 690 690 716 716
21,000,000 21,000,000 21,000,000 21,000,000 21,000,000 21,000,000
75 75 75 75 75 75
56 56 56 56 57 57
1 1 1 1 1 1
1 1 1 1 1 1
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