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FINANCIAL TRENDS AND CONDITIONS
<br />FINANCIAL CONDITION OF THE GOVERNMENTAL FUNDS AND ACTIVITIES AS A WHOLE
<br />The governmental funds are generally in good financial condition, with total fund balances of
<br />$34,558,463 at December 31, 2008. This level of fund balance for all governmental funds represents an
<br />increase of $3,800,293 over the prior year fund balance for all governmental funds of $30,758,170.
<br />The Statement of Net Assets shows an increase in the net assets of the governmental activities of
<br />$8,904,054, with ending net assets of $70,578,537. Since this statement is based on accrual accounting
<br />rather than modified accounting, the money spent on capital project costs are capitalized as assets, while
<br />in the fund statements they are expended.
<br />GENERAL FUND
<br />The City's General Fund accounts for the financial activity of the basic services provided to the
<br />community. The primary services included within this fund are the administration of the municipal
<br />operation, police and fire protection, building inspection, streets and highway maintenance, and parks and
<br />recreation.
<br />The following graph displays the City's General Fund trends of financial position and changes in the
<br />volume of financial activity. Fund balance and cash balance are typically used as indicators of financial
<br />health or equity, while annual revenue is often used to measure the size of the operation.
<br />$10,000,000
<br />$9,000,000
<br />$8,000,000
<br />$7,000,000
<br />$6,000,000
<br />$5,000,000
<br />$4,000,000
<br />$3,000,000
<br />$2,000,000
<br />$1,000,000
<br />General Fund Financial Position
<br />Year Ended December 31,
<br />1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
<br />Fund Balance CI Cash Balance Revenue
<br />The City's General Fund cash and investments balance at December 31, 2008 was $7,069,742, a decrease
<br />of $106,562 from the previous year. Total fund balance at year -end was $6,978,548, a decrease of
<br />$33,722, from the prior year. The City Council has reserved or designated all but $980,345 of this fund
<br />balance for specific purposes. The stability of the General Fund's financial position is greatly attributed
<br />to the City's "Fund Balance and Excess Revenue Policy" as well as the general budgeting policies. These
<br />policies have allowed the City to provide funding for equipment replacement and recurring capital
<br />maintenance programs without disrupting the General Fund's financial position. This is an important
<br />factor because a government, like any organization, requires a certain amount of equity to operate. The
<br />amount of required equity increases as the size of the operation increases. Increase in the size of the
<br />operation is natural, caused by such things as inflation, population growth, desired increases in services,
<br />and — something which has impacted cities significantly in recent years— mandated increases in services
<br />and administrative requirements.
<br />The graph shows the rapid yet steady growth in fund equity, absent of significant year -to -year
<br />fluctuations. This indicates a stable operation with effective financial controls.
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