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Special Revenue Funds (continued) Peace Officers Fund: The Peace Officers Fund was set up to account for public safety restricted revenues which must be used exclusively for public safety expenditures and other expenditures as specified in conjunction with confiscations and the annual bike road -eo. On December 31, 1993, the fund balance was $10,388, compared to $8,555 on December 31, 1992. Lawful Gambling Fund: The Lawful Gambling Fund was established to account for lawful gambling revenues received and lawful purpose expenditures made by the City as authorized by Minnesota Statutes Chapter 349. The fund balance as of December 31, 1993 was $39,570, which represents an increase of $18,441 over December 31, 1992. Debt Service Funds JFTINAN T[AL ETm'7t'T[QDm (Continued) Debt Service Funds are used to account for the current year payment of matured principal and interest on long -term general obligation debt. Sources available for payment of the debt service are provided by special assessments, tax increments, and general property tax levies. During 1993, the City issued General Obligation Tax Increment Refunding Bonds totaling $2,225,000. The proceeds of this bond issue will be used to refund the 1997 through 2007 maturities totaling $2,150,000 of the City's $2,800,000 General Obligation Tax Increment Bonds Series 1987A. The refunding was accomplished by means of a "crossover" mechanism. At the time of settlement, all proceeds were placed in an escrow account from which the interest on the Series 1993A Bonds will be paid. The City will continue to pay debt service on the Series 1987A Bonds through February 1, 1996, on which date the remaining principal will be paid from the escrow account and the City will crossover and pay the debt service on the Series 1993A Bonds. This crossover refunding was undertaken to reduce total debt service and resulted in a present value savings of $257,330. The combined fund balance at December 31, 1993 was $3,839,022, compared to $1,026,767 on December 31, 1992. The escrow account, which is reported in the individual debt service funds as cash and investments held by escrow agents, causes the significant resulting increase in the year end fund balance position. Capital Project Funds: Capital Project Funds are those funds established to account for the financial resources to be used for the acquisition or construction of major capital facilities, other than those financed by Enterprise or Trust Funds. x