HomeMy WebLinkAbout2009/06/15 - ADMIN - Minutes - City Council - Study Session St. Louis Park OFFICIAL MINUTES
MINNESOTA CITY COUNCIL SPECIAL STUDY SESSION
ST. LOUIS PARK, MINNESOTA
JUNE 15, 2009
The meeting convened at 7:05 p.m.
Councilmembers present: Mayor Jeff Jacobs, John Basill, Phil Finkelstein, Paul Omodt Loran
Paprocki and Susan Sanger.
Councilmembers absent: C. Paul Carver
Staff present: City Manager (Mr. Harmening), Finance Director (Mr. DeJong), Assistant Finance
Director (Mr. Swanson), Community Development Director (Mr. Locke), and Recording Secretary
(Ms. Hughes).
Guest: Steve McDonald, (Abdo Eick & Meyers, LLP)
1. 2008 Annual Audit
Mr. McDonald presented the draft audit, management report and financial highlights and stated the
financial statements will be completed prior to the June 30th deadline and submitted to the Office of
State Auditor. He explained the audit opinion indicates the financial statements are materially
correct and fairly represent the City's financial condition as of December 31, 2008. He added there
were no findings that reach the level of a material weakness in the City's financial policies and
procedures. He stated the audit noted one small finding with respect to the billing and collection of
receipts at the Recreation Center, which found no deal reconciliation of the receipts posted to the
point of sale system to the actual deposit prior to taking to the bank. He recommended the City
establish reconciliation procedures of the daily deposit to the amounts posted that include a
signature of the person reconciling to ensure items have been posted accurately, and they are satisfied
that their recommendation will be implemented by the City.
Mr. McDonald reviewed the summary of prior year findings and stated the earlier findings with
respect to preparation of financial statements and limited segregation of duties over cash
disbursements, cash receipts and payroll have been eliminated based on actions taken by the City.
Mr. McDonald pointed out one change in the qualitative aspects of accounting practices and GASB
No. 45 related to post-employment benefits other than pensions. He stated the requirements of this
standard have been implemented and booked onto the financial statements so the City is in
compliance with this standard.
Mr. McDonald discussed the General Fund balance and noted for the past five years the City has
maintained a working capital reserve in line with State Auditor requirements. He added the percent
of fund balance to budget was 49.1% in 2008. He reviewed General Fund revenues and
expenditures compared to budget, which show positive budget performance. He stated the largest
increase was in licenses and permits.
Special Study Session Minutes -2- June 15, 2009
Mr. DeJong stated there was some turnover in the Police Department, which resulted in significant
savings in personnel costs. He added the City's department heads were also asked to review their
budgets and reduce expenses where appropriate.
Mr. McDonald stated the deficit in Capital Projects Fund is being monitored and pointed out there
is approximately $27 million in bonds and the City is meeting its obligations. He reviewed the
Enterprise Funds and stated the increase in the water utility is driven by unspent bond proceeds. He
stated the City had $6.4 million in bonds at the end of the year, and the bonds have good margins
and are generating positive cash flow. He stated the Sewer Utility Fund cash reserves of$2 million
appear adequate. He indicated the Refuse Fund is stable as intended; the Storm Water Utility Fund
had a cash balance that decreased from 2007 to 2008 due to capital improvement projects. He
noted the Wireless Fund cash balance is due to the settlement received in 2008.
Mr. DeJong noted that there is a loan from the Development Fund of approximately $1.3 million
that will be repaid with a portion of the cash in the Wireless Fund; this fund is left open so the City
can finish the year, get the poles out of the ground, and perform any cleanup work. He stated
whatever cash that the City is short in repaying that loan will become an expense in the
Development Fund.
Mr. McDonald reviewed the ratio analysis and stated the analysis was updated this year to include all
cities with a population of 20,000 to 100,000; this data provides comparative data of where the City
stands relative to its peer groups. He added that overall, the City's ratio is favorable with debt
service coverage showing the City is generating enough cash to pay its expenses. He expressed his
thanks to the finance department and City staff for their work on the audit.
The meeting adjourned at 7:27 p.m.
Nancy Stroth, City Clerk Jeff Jaco.s, Mayr