1996 CAFR - Laserfiche WebLink

Home

ACCOUNTING SYSTEM. INTERNAL AND BUDGETARY CONTROLS (continued) CASH MANAGEMENT The City of Ramsey subscribes to the "pooled cash" concept of investing, which means that all funds with cash balances (except the Escrow Fund and certain other funds) participate in an investment pool. This pooled cash concept provides for investing greater amounts of money at more favorable rates. During 1996, the City earned $1,003,098 from investments in obligations issued by the United States and its agencies, bank certificates of deposit, and commercial paper. RISK MANAGEMENT The City participates in the League of Minnesota Cities Insurance Trust [LMCIT], a public entity risk pool for its general property and casualty, workers' compensation, and other miscellaneous insurance coverages. The LMCIT operates as a common risk management and insurance program for approximately 780 cities. The City pays an annual premium to the LMCIT for insurance coverage. The LMCIT agreement provides that the Trust will be self- sustaining through member premiums and will reinsure through commercial companies for claims in excess of certain limits. The City has elected higher deductibles through the LMCIT in order to keep premiums at a minimum. To supplement the commercial coverages, the City established the Self-Insurance Trust Fund. Premiums for the LMCIT policies are not paid from the the Self-Insurance Trust Fund, but rather are budgeted and paid from the respective operating funds. The City also carries commercial insurance for certain other risks of loss, including employee health insurance. Settled claims resulting from these risks have not exceeded commercial insurance coverage in any of the past three fiscal years. DEBT ADMINISTRATION Net bonded debt per capita and the percentage of net debt to the tax capacity and market value are useful indicators of the City's debt position to municipal management, citizens, and investors in city bonds. Debt statistics are listed as follows: Net Bonded Debt per Capita Ratio of Net Bonded Debt to Tax Capacity Ratio of Net Bonded Debt to Market Value The following is a summary of bonded debt for fiscal year 1996: Gross Debt Outstanding, January 1, 1996 Add Bonds Issued - 1996 Deduct Bonds Redeemed - 1996 Gross Debt Outstanding, December 31, 1996 Less Amounts Available in Debt Service Funds, December 31, 1996 Net Bonded Debt, December 31, 1996 $306.72 59.73% .92% $ 8,160,000 330,000 2.960,000 $ 5,530,000 315.815 $ 5.214.185 41.11