Agenda - Council Work Session - 06/25/2013

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GOVERNMENTAL FUNDS EXPENDITURES The expenditures of governmental funds will also vary from state -wide averages and from year -to -year, based on the City's circumstances. Expenditures are classified into three types as follows: • Current — These are typically the general operating type expenditures occurring on an annual basis, and are primarily funded by general sources such as taxes and intergovernmental revenues. • Capital Outlay and Construction — These expenditures do not occur on a consistent basis, more typically fluctuating significantly from year -to -year. Many of these expenditures are project- oriented, which are often funded by specific sources that have benefited from the expenditure, such as special assessment improvement projects. • Debt Service — Although the expenditures for debt service may be relatively consistent over the term of the respective debt, the funding source is the important factor. Some debt may be repaid through specific sources such as special assessments or redevelopment funding, while other debt may be repaid with general property taxes. The City's expenditures per capita of its governmental funds for the past three years, together with state -wide averages, are presented in the following table: Governmental Funds Expenditures per Capita With State -Wide Averages by Population Class State -Wide City of Ramsey Year December 31, 2011 2010 2011 2012 Population 2,500- 10,000 10,000 - 20,000 20,000- 100,000 23,668 23,702 23,835 Current General government $ 126 $ 99 $ 82 $ 181 $ 205 $ 767 Public safety 231 225 238 160 164 162 Street maintenance and lighting 114 108 89 116 209 184 Parks and recreation 79 96 87 35 36 35 All other 74 81 82 $ 624 $ 609 $ 578 $ 492 $ 614 $ 1,148 Capital outlay and construction $ 258 $ 272 $ 233 $ 268 $ 278 $ 141 Debt service Principal $ 186 $ 148 $ 109 $ 94 $ 76 $ 62 Interest and fiscal 60 48 41 56 52 112 $ 246 $ 196 $ 150 $ 150 $ 128 $ 174 The City has historically and consistently used limited expenditure functions for financial statement reporting purposes. As the City has grown and increased spending for community development and other areas, we encourage the City to review the format and level of functional detail presented in future comprehensive annual financial reports. We believe this will enhance comparisons to state -wide averages and improve fmancial statement transparency, identifying changes from year -to -year. Total expenditures in the City's governmental funds for 2012 were $34,916,380, an increase of $10,759,967, (44.5 percent) from the prior year. On a per capita basis, the City expended a total of $1,463 in 2012. Current expenditures increased $534 per capita from last year. This increase was primarily for approved expenditures incurred within Tax Increment District 14, for The COR (Center of Ramsey) Development project as mentioned earlier for the decrease in governmental fund balance. Capital outlay expenditures for 2012 were $137 less per capita than the prior year due to fewer city street construction expenditures. Debt service expenditures for 2012 were $46 per capita higher than the prior year as scheduled, with two bonds issued in the current year and schedule debt payments, including current refunding payments made to escrow. -10-