2019 CAFR - Laserfiche WebLink

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During the current fiscal year, the City saw a decrease of $2,280,000 in bonds and certificates. The City did not issue any new debt in 2019. Due to higher wages and employees retaining larger balances at year end, the compensated absence liability increased by $43,073. Net pension liability saw an increase of $184,853 to reflect the change in the City's proportionate share of the state-wide PERA pension plan obligation. Other Post - Employment Benefits (OPEB) increased $54,173 due to the annual OPEB costs exceeding contributions as actuarially determined with the parameters of GASB Statement No. 75. State statutes limit the amount of general obligation debt a governmental entity may issue to three percent of its total assessed valuation. The current legal debt margin for the City is $62,614,838. The City has sufficient funds on hand to make all required bond payments, and anticipates an ongoing stream of revenue to make future bond payments. Additional details of the long-term debt activity for the year can be found in Note 5 of the notes to basic financial statements. Economic Factors and Next Year's Budgets and Rates • The unemployment rate for the City of Ramsey is currently 3.2%, which is an increase from a rate of 2.5% a year ago. The state of Minnesota shows an average unemployment rate of 3.3%, whereas, nationally the unemployment rate is 3.5%. • The number of foreclosures in the City of Ramsey increased from 23 units in 2018 to 32 in 2019. In comparison, the State of Minnesota saw a decrease in foreclosures from 3,495 in 2018 to 2,066 in 2019. • Inflationary trends in the region compare favorably to national indices. • The city is expecting steady residential and commercial growth within the next three years, spurred by access to the Ramsey Station for the Minnesota Northstar commuter rail, the construction of the Armstrong interchange, a new industrial business park and continued development within The COR. • The Novel Coronavirus (COVID — 19) has caused significant volatility in market conditions, including substantial reductions in the active -market prices of some investments. The City's portfolio consists primarily of short-term investments, many with guaranteed maturity values. The City does not expect any losses ultimately realized from this market decline to be material. Also, the COVID — 19 may cause a decrease in the collection of property taxes. The City is taking steps to be prepared for this possible decrease with using existing fund balances to pay debt service, and continuing to monitor other revenue sources such as building activity. All of these factors were considered in preparing the City of Ramsey's budget for the 2020 fiscal year. The water and sewer utility rates were increased for the 2020 budget year. The water utility, which has a tiered rate structure, will increase by an average of 2% for all customers. The sewer utility, which has a flat rate structure for residential and per gallon usage for commercial will increase an average of 1%. The increased rates are to not only offset current maintenance costs and depreciation, but to help finance future utility improvements that are documented in the City's ten-year Capital Improvement Plan. REQUESTS FOR INFORMATION Questions concerning any of the information provided in this report or requests for additional information should be addressed by writing to the City of Ramsey, 7550 Sunwood Drive Northwest, Ramsey, MN 55303 or by calling (763) 427-1410. 36