Agenda - Council Work Session - 06/28/2016

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GOVERNMENTAL FUND 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, and 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 31,2014 2013 2014 2015 Population 2,500-10,000 10,000-20,000 20,000-100,000 24,306 24,935 25,598 Current General government $ 131 $ 104 $ 87 $ 117 $ 127 $ 122 Public safety 248 237 254 154 153 157 Street maintenance and lighting 121 119 114 160 118 71 Parks and recreation 86 101 92 42 40 56 All other 69 89 98 — — — 655 650 645 473 438 406 Capital outlay and construction 357 278 276 29 148 247 Debt service Principal 180 163 115 54 63 343 Interest and fiscal 54 40 34 50 47 43 234 203 149 104 110 386 Total expenditures $ 1,246 $ 1,131 $ 1,070 $ 606 $ 696 $ 1,039 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 financial statement transparency, identifying changes from year-to-year. Total expenditures in the City's governmental funds for 2015 were $26,572,856, an increase of $9,203,983 from the prior year. On a per capita basis, the City expended a total of $1,039 in 2015. Current expenditures decreased $32 per capita from last year. This decrease was primarily in street maintenance and expenditures for joint project costs incurred in the prior year. Capital outlay expenditures were $99 more per capita than the prior year due to a larger street construction and Fire Station#2 expenditures in the current year. The change in debt service activity was due to scheduled debt repayment plans and the prepayment of bonds from the developer reimbursement proceeds received in the current year. -8-