HomeMy WebLinkAbout2003 CAFRCOMPREHENSIVE
ANNUAL
FINANCIAL
REPORT
FOR THE YEAR ENDED DECEMBER 31, 2003
MINNESOTA
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1685 CROSSTOWN BOULEVARD N.W. ANDOVER, MINNESOTA 55304 (763) 755-5100
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FAX (763) 755-8923 WWW.CI.ANDOVER.MN.US
Comprehensive Annual Financial Report
of the
City of Andover, Minnesota
For the Year Ended
December 31, 2003
Prepared By: Finance Department
City of Andover
CITY OF ANDOVER, MINNESOTA
TABLE OF CONTENTS
Page
ReferenceNo.
I. INTRODUCTORY SECTION
Letter of Transmittal2
Organization10
Organizational Chart11
Certificate of Achievement12
II. FINANCIAL SECTION
Independent Auditor's Report14
Management's Discussion and Analysis16
Basic Financial Statements:
Government-Wide Financial Statements:
Statement of Net AssetsStatement 127
Statement of ActivitiesStatement 228
Fund Financial Statements:
Balance Sheet - Governmental FundsStatement 330
Statement of Revenues, Expenditures, and Changes in Fund Balances -
Governmental FundsStatement 432
Reconciliation of the Statement of Revenues, Expenditures, and Changes in
Fund Balances of Governmental Funds Statement 535
Statement of Net Assets - Proprietary FundsStatement 636
Statement of Revenues, Expenses, and Changes in Fund Net Assets -
Proprietary FundsStatement 738
Statement of Cash Flows - Proprietary FundsStatement 840
Statement of Fiduciary Net Assets - Fiduciary FundsStatement 942
Notes to Financial Statements43
Required Supplementary Information:
Budgetary Comparison Schedule - General FundStatement 1076
Notes to Required Supplementary Information:
Legal Compliance - Budgets78
Modified Approach for City Streets and Trails Infrastructure Capital Assets78
Combining and Individual Fund Statements and Schedules:
Nonmajor Governmental Funds:
Combining Balance Sheet - Nonmajor Governmental FundsStatement 1183
Combining Statement of Revenues, Expenditures and Changes in Fund Balance -
Nonmajor Governmental FundsStatement 1284
CITY OF ANDOVER, MINNESOTA
TABLE OF CONTENTS
Page
ReferenceNo.
Nonmajor Special Revenue Funds:
Subcombining Balance Sheet - Nonmajor Special Revenue FundsStatement 1386
Subcombining Statement of Revenues, Expenditures and Changes in
Fund Balances - Nonmajor Special Revenue FundsStatement 1488
Nonmajor Debt Service Funds:
Subcombining Balance Sheet - Nonmajor Debt Service FundsStatement 1592
Subcombining Statement of Revenues, Expenditures and Changes in
Fund Balances - Nonmajor Debt Service FundsStatement 1694
Nonmajor Capital Projects Funds:
Subcombining Balance Sheet - Nonmajor Capital Project FundsStatement 1798
Subcombining Statement of Revenues, Expenditures and Changes in
Fund Balances - Nonmajor Capital Project FundsStatement 18100
Special Revenue Funds:
Schedules of Revenues, Expenditures and Changes in
Fund Balances - Budget and Actual:
ForestryStatement 19102
LRRWMOStatement 20103
Drainage and MappingStatement 21104
EDA GeneralStatement 22105
Trail and TransportationStatement 23106
Right-of-Way Management/UtilityStatement 24107
Capital Equipment ReserveStatement 25108
Construction Seal CoatingStatement 26109
Internal Service Funds:
Combining Statement of Net Assets - Internal Service FundsStatement 27111
Combining Statement of Revenues, Expenses, and Changes in Fund Net Assets -
Internal Service FundsStatement 28112
Combining Statement of Cash Flows - Internal Service FundsStatement 29113
Agency Funds:
Combining Statement of Net Assets - Fuduciary FundsStatement 30115
Capital Assets Used in the Operation of Governmental Funds:
Schedule By SourceStatement 31117
Schedule By Function and ActivityStatement 32118
Schedule of Changes By Function and ActivityStatement 33120
Supplementary Financial Information:
Combined Schedule of IndebtednessExhibit 1122
Schedule of Tax Capacity Rates and LeviesExhibit 2124
Schedule of Deferred Tax Levies - General Obligation BondsExhibit 3125
Schedule of Fund TransfersExhibit 4126
CITY OF ANDOVER, MINNESOTA
TABLE OF CONTENTS
Page
ReferenceNo.
III. STATISTICAL SECTION (UNAUDITED)
Government-Wide Information:
Government-Wide Expenses By FunctionTable 1130
Government-Wide Revenues By SourceTable 2131
Fund Information:
General Fund Revenues By Source - Last Ten Fiscal YearsTable 3132
General Fund Expenditures By Function - Last Ten Fiscal YearsTable 4133
Property Tax Levies and Collections - Last Ten Fiscal YearsTable 5134
Special Assessment Levies and Collections - Last Ten Fiscal YearsTable 6134
Assessed and Estimated Actual Value of Taxable Property - Years 1995 through 2004Table 7135
Ratio of Net Bonded Debt to Assessed Value and Net Bonded Debt Per Capita
Last Ten Fiscal YearsTable 8135
Ratio of Annual Debt Service Expenditures for General Bonded Debt
to Total General Governmental Expenditures - Last Ten Fiscal YearsTable 9136
Property Tax Rates - Direct and Overlapping Governments -
Years 1994 through 2003Table 10136
Computation of Direct and Overlapping Debt Including Debt RatiosTable 11137
Principal TaxpayersTable 12137
Building Permits, Property Values and Households - Last Ten Fiscal YearsTable 13138
DemographicsTable 14139
Miscellaneous Statistical DataTable 15140
I. INTRODUCTORY SECTION
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1685 CROSSTOWN BOULEVARD N.W. ANDOVER, MINNESOTA 55304 (763) 755-5100
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FAX (763) 755-8923 WWW.CI.ANDOVER.MN.US
March 15, 2004
To the Honorable Mayor and City Council
City of Andover
1685 Crosstown Blvd. NW
Andover, Minnesota 55304
Dear Honorable Mayor and Council Members:
The Comprehensive Annual Financial Report is submitted in conformance with all applicable governing laws and regulations.
The following has set the standards forth:
*Andover City Policy and Code
*The State Auditor, State of Minnesota
*Government Finance Officers Association
*Governmental Accounting Standards Board
RESPONSIBILITY.
Responsibility for both the accuracy of the presented data and the completeness of the financial statements
including all disclosures rests with the City. We believe the data, as presented, is accurate in all material aspects. This report has
been presented in a manner designed to fairly set forth the financial position and results of operations as measured by the
financial activity of its various funds.
FINANCIAL STATEMENT FORMAT.
This Comprehensive Annual Financial Report is presented in three main sections:
I.Introductory
II.Financial
III.Statistical
Introduction
Theincludes a list of the City's principal officials as of December 31, 2003, the table of contents, organizational
Financial Section
chart, and this Letter of Transmittal. The includes: (1) independent auditor's opinion; (2) management’s
discussion and analysis; (3) government wide and fund financial statements; (4) notes to the financial statements; (5) required
supplementary information; (6) the combining statements, individual fund statements; and, (7) the supplemental information.
Statistical Section
The includes tables and reports of various economic, social, financial and fiscal data designed to reflect trends
and ratios.
GAAP require that management provide a narrative introduction, overview, and analysis to accompany the basic financial
statements in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement
MD&A and should be read in conjunction with it. The City of Andover’s MD&A can be found immediately following the report
of the independent auditors.
REPORTING ENTITY.
All City funds, departments, commissions, and other organizations for which the City of Andover is
financially accountable are presented within the Comprehensive Annual Financial Report. The Andover Firefighters’ Relief
Association does not meet the established criteria for inclusion in the reporting entity, and accordingly are excluded from this
report.
GENERAL INFORMATION.
The city we know today as Andover was first organized in 1857 under the name “Round Lake
Township.” However, in 1860 the name was changedto “Grow Township” in honor of Senator Galusha A. Grow of
Pennsylvania. Senator Grow spoke at a political campaign in Anoka that year, and the town name was changed to reflect Senator
Grow because of his strong advocacy of the Union cause. At that time, the population was 330 and included the geographical
area we know today as Ham Lake. In fact, the area of Ham Lake was considered a part of Grow Township until 1871.
In 1972, the Grow Township Board of Supervisors recognized that the town was growing at a very rapid rate. They felt a village
form of government would provide better services to the community. Board supervisors then voted in favor of proceeding with
the incorporation process. The board voted to submit a new name for the village. “Andover Village” was chosen because the
name Andover had historical interest. The historical interest, we believe, came from the Andover train station.
To the Honorable Mayor and City Council
City of Andover, Minnesota
You may have heard the popular “train myth” about how Andover received its name. The myth states that a train tipped over in a
swamp, and an eyewitness, relaying the incident, said it “went over and over,” thereby naming the city “Andover.” However,
Anoka County Union Newspaper
research reveals that the name Andover first appeared in an article dated March 14, 1899 in the
-
before train tracks were ever built in the city.
The article stated that the Eastern Minnesota line of the Great Northern Railway was in the process of constructing railroad tracks
from the Coon Creek Cut-off to the North. The railway announced that new railroad stations with mathematical precision were to
be located five miles apart from each other. Thenew stations (from Coon Creek to the North, along the new railroad line) were
to be named Andover, Cedar, Bethel, Isanti, Cambridge, Stanchfield, Braham, Grasston, Cornell, and Brook Park. On July 4,
1899, the first train passed through the Andover Station. Where the railway came up with the name Andover still remains
unknown.
Andover Village was established in 1972 and then became the City of Andover, a city of the fourth class, in 1974. Today the
City of Andover’s population exceeds 26,000, classifying it as a third class city.
The City of Andover as it exists today consists of 23,040 acres. Andover has a population estimated at 30,000. A rapidly
growing suburb of the northern metropolitan area, the City of Andover is approximately sixteen miles from Minneapolis.
SERVICES PROVIDED.
The City of Andover provides various services to the residents in the community. The current
services are:
General Government:
Mayor and City councilFinancial administrationInformation systems
NewsletterElectionsFacility management
City clerkAssessingEngineering
AdministrationLegalRisk management
Human resourcesPlanning and zoning
Public Safety:
PoliceProtective inspectionAnimal control
Fire protectionCivil defense
Public Works:
Streets and highwaysStreet signsTraffic signals
Snow and ice removalCentral equipment maintenanceWater maintenance
Street lighting
Sanitation:
Storm sewersTree preservation & weed controlSanitary sewer maintenance
Parks and Recreation
Recycling
GOVERNMENT STRUCTURE.
Andover is a statutory city with the City Council appointing a City Administrator. The City
Administrator has operating responsibilities for all City functions.
IMPLEMENTATION OF GASB 34
In June 1999, the GASB issued Statement 34, which is the most comprehensive government accounting rule ever developed. This
standard substantially changes the way state and local governments report their financial activity. Andover had implemented
these changes in 2002. A summary of the most significant changes is as follows:
1.Government-wide financial statements are prepared using full accrual accounting
2.Basic fund financial statements present major funds instead of fund types
3.Budgetary comparisons include original and amended budgets
4.All infrastructures have been capitalized and all capital assets are depreciated except streets and trails that are under the
modified approach.
5.A management discussion and analysis is included as required supplemental information
To the Honorable Mayor and City Council
City of Andover, Minnesota
ECONOMIC CONDITION AND OUTLOOK
Very moderate population growth is expected to continue in 2004 and 2005, with an estimated population of 34,500 by 2010. The
rate of residential growth slowed substantially in 1999 and 2000 as the availability of residentially zoned property decreased.
The City experienced a significant amount of commercial growth during 2000 and 2001. Continual commercial growth is
anticipated over the next five to ten years, beyond that growth will slow as the amount of undeveloped commercially zoned
property also declines.
The City's General Fund has two major categories of revenue, which accounted for 78% of the total in 2003. They are general
property taxes at 68%, and charges for services at 10%. In prior years, intergovernmental revenue was the second largest
category of revenue for the General Fund. Intergovernmental revenue includes state aids, such as local government aid (LGA),
market value homestead credit (MVHC), highway maintenance aid, fire relief aid and police aid; and county grants, such as
recycling and community development.
During the past several years, the State of Minnesota has made numerous changes to laws pertaining to the distribution of LGA,
Homestead and Agricultural Credit Aid (HACA) and MVHC resulting in a significant reduction in intergovernmental revenue.
The City was able to make up this loss in aid through an increased tax levy, substantially increasing the local tax rate for 2002.
The tax laws that resulted in this change also greatly reduced school district property tax levies, resulting in no net tax increase
for most residential property owners. Sweeping changes approved in 2003 resulted in the loss of approximately $590,000 in aid
to Andover. The state will allow cities the ability to levy up to 60% of the lost 2003 aid in 2004.
LGA, HACA and MVHC for 1998 through 2004 are as follows:
YearLGAHACAMVHCTotal
1998$122,651$378,975$-$501,626
1999111,145462,796-573,941
2000119,752490,237-609,989
2001119,758489,991-609,749
2002119,827-563,754683,581
2003*--65,63265,632
2004*--86,86486,864
*Due to the State Legislative actions to deal with the budget deficit,
the City will not be receiving any LGA and significantly reduced MVHC.
For 1998 through 2000, Cities with populations over 2,500 were under levy limit restrictions imposed by the State. Levy limits
severely curb the ability of Cities to generate additional tax revenue needed to respond to an increasing demand for services. For
1999 and 2000, the levy limit formula was modified to allow for increases based on commercial and industrial growth. This was
a favorable change for Andover, as the City experienced a surge in commercial growth during the past few years. Levy limits
were lifted for 2001 but were reinstated for 2002 and 2003. Strict levy limits were in place for 2004 that did not allow cities the
ability to capture residential and commercial market value growth.
The State's property tax reform efforts have also included modifications to property class rates. Reductions in the class rates for
all major types of property have occurred in 1998, 1999, 2000, and for 2002. These changes resulted in a decrease in the taxable
value of most properties. These changes and the impact on various valued properties are shown in the following table:
To the Honorable Mayor and City Council
City of Andover, Minnesota
Class Rate
199819992000 & 20012002 & 2003
Residential Homestead
Value to $75,0001.00%1.00%1.00%1.00%
$76,000 to $500,0001.85%1.70%1.65%1.00%
Over $500,0001.85%1.70%1.65%1.25%
Commercial / Industrial
Value to $150,0002.70%2.45%2.40%1.50%
Value above $150,0004.00%3.50%3.40%2.00%
Tax Capacity
199819992000 & 20012002 & 2003
Taxable Market Value
Residential Homestead
$100,000$1,213$1,175$1,163$1,000
150,0002,1382,0251,9881,500
200,0003,0632,8752,8132,000
250,0003,9883,7253,6382,500
300,0004,9134,5754,4633,000
Commercial / Industrial
$550,000$20,050$17,675$17,200$10,250
750,00028,05024,67524,00014,250
1,000,00038,05033,42532,50019,250
2,500,00098,05085,92583,50049,250
The City received a substantial amount of revenue from licenses and permits from 1990 through 2003. The past 5 years are
shown below:
RevenuesChange
1999$609,344n/a
2000623,662$14,318
2001720,71297,050
2002588,965(131,747)
2003551,385(37,580)
The $131,747 decrease in revenue for 2002 is due to reclassification of plan check fees ($263,535), which were previously
recorded as license and permit fee and are now recorded as a charges for services revenue. Revenue from residential building
continued to modestly increase through 2002 but declined in 2003, as a reduced number of new residential lots are being added to
the overall lot inventory.
The City analyzes user fees every year as part of the budget process and makes adjustments where appropriate. Revenue from
charges for services totaled $689,427 in 2002, and $647,813 in 2003. The decline is the result of a reduction in fees generated
from the declining number of new development projects.
EMPLOYMENT
The City of Andover’s largest employers are government entities. The Anok-Hennepin School District has a significant presence
in the community and Anoka County’s Parks and Highway Departments and Sheriffs Office headquarters are located in Andover.
The City of Andover is best classified as a bedroom community, since a majority of the residents commute outside of Andover
for employment opportunities. The City does anticipate with the development of Andover Station Commercial Park and
Clocktower Commons, that additional employment opportunities will be provided to residents in the near future.
To the Honorable Mayor and City Council
City of Andover, Minnesota
Major employers in Andover are as follows:
Number of
FirmType of Business / ProductEmployees
ISD No 11 Anoka-HennepinElementary and secondary education523
Anoka County Parks and Highway DepartmentsCounty government and services247
Kottkes' Bus Service, Inc.Bus transportation173
Festival FoodsGrocery store120
Presbyterian Homes of AndoverSenior housing and assisted living facilities86
Ed Fields & Sons, Inc.Vegetable farming70
McDonald'sRestaurant60
Meadow Creek Christian SchoolPrivate education K-1260
MAJOR INITIATIVES
FOR THE YEAR.
The City has many accomplishments to report for 2003. The following list is a summary of some of the
major initiatives completed throughout the year.
1)The September 2003 completion of the City’s 6 million gallon per day (mgd) Water Treatment Plant has initiated a new
era of City water services. With the need to meet new state and federal standards on drinking water, the automated
production of treated water meets and/or exceeds all federal health guidelines relating to drinking water standards.
Plant completion also included the construction of an underground 1.5 million gallon reservoir tank, versus an elevated
tower, at a savings to utility customers of over $1.3 million in capital costs.
2)Council approval of the design and development of a new Fire Station (#3) in the northeast section of the City will
replace the existing fire facility presently located on the City Center campus on Crosstown Boulevard. The decision to
authorize this project was based on several factors associated with a growing service population, improving service
response rates, relocation of the existing station on the east side of heavily used commercial railroad tracks,
obsolescence of the existing fire station in terms of space and staffing needs and an updated fire services study
justifying the need for a relocated third fire station. Anticipated occupancy of this new station is scheduled for
November 2004.
3)On-going progress related to the planned construction of a new 140,000 sq. ft. Community Center in partnership with
the Greater Minneapolis YMCA. This facility has progressed to the design stage and includes a indoor ice arena seating
800 spectators, an aquatics center with water slides and a fitness center to be operated by the YMCA, and a fieldhouse,
with running track and spectator seating for a wide range of indoor sporting events. Fund raising in the form of a
Capital Campaign is in progress with the goal of raising $3.5 million by June 30, 2004 to assist in project financing. A
decision to move forward with the project is anticipated in early 2004.
4)Continued negotiations with United Properties on the Andover Station south commercial and residential center has led
to the approval of site plans calling for the construction of a new 146,000 sq. ft. Target Greatland, a Walgreen’s and the
creation of 3 additional building pads in the land area. The Andover Economic Development Authority’s recent
approval will result in a dramatic reconfiguration of the area that will create a host of outdoor pedestrian amenities,
complete with walking trails, a pergola, and a lighted fountain. In addition, the City has authorized the final plat of the
Villages at Andover Station for Bruggeman Homes that will lead to the construction of 75 high-quality multi-family
units on the 8.65 acre site located just south of the new Andover Marketplace shopping center.
5)The highly successful hosting of the City’s First Business Appreciation Day to recognize and build awareness of the
local business community and strengthen relationships with this important element of the Andover community. This
event was coordinated through the Community Development Department and the Greater Anoka Chamber of
Commerce.
6)The negotiated acquisition of property for the future expansion of the City Center campus to the west of existing Public
Works facilities. Land negotiations with the property owner resulted in a three phase acquisition schedule of
approximately 29 acres of land that will enable the City to consider a wide range of expansion options.
To the Honorable Mayor and City Council
City of Andover, Minnesota
7)The creation of a Storm Sewer Management Utility Fund to assist in meeting new Federal requirements on the
environmental management of storm water discharge. Costs for addressing these stringent federal requirements will be
borne by property owners directly through a service fee that is based on their respective and proportionate generation of
storm water discharge affecting the City’s environmental resources. Reporting requirements will be handled through
the City Engineering Department’s Natural Resource office.
8)The successful establishment of an Annual State of the City address by the Mayor showcasing the past year’s
achievements and accomplishments in terms of residential growth, economic development and City programming and
services.
9)The successful completion of the City’s Transportation Plan that establishes a strategic vision of where future City
transit improvements will be made to accommodate increased motorist demands on the City’s transportation
infrastructure. The plan was adopted by the City Council and approved by the Metropolitan Council.
10)A review of the City’s fire service delivery system led to a significant increase in the City’s Insurance Services Office
(ISO) fire rating that should benefit property owner insurance rates in the rural areas of the community. Property
owners in these affected areas should contact their insurance carriers with this new information regarding how their
properties are evaluated for insurance rating factors.
11)The City Council gave final approval on a "Designated Rural Reserve" area for future urbanized growth. This area
constitutes 959 acres of land in portions of Andover that are currently located outside the 2020 MUSA boundary. This
18-month long process engaged affected property owners to study the feasibility of providing City utility services and
determining future transportation connections in an area once guided for large lot rural development. The Metropolitan
Council ratified the designated rural reserve area, which allows the City to prudently plan and economize the
development potential of this precious natural resource.
12)Completion of the City's first "Comprehensive Annual Financial Report" (CAFR) rather than "Audited Financial
Report" for the year ended December 31, 2002. The 2002 CAFR was a recipient of the "Excellence in Financial
Reporting Award” by the Government Finance Officers Association. By internally completing this report, the City
realized cost savings in the form of reduced financial consulting fees.
13)Awarded for the second year in a row the Government Finance Officers Association Distinguished Budget Presentation
Award for the City's 2003 Annual Budget. This award recognizes excellence in the preparation of the City’s budget
document as a policy document, an operations guide, as a financial plan and as a communications device.
14)Completed the two-year process of codifying the City ordinances according to title, section and chapter and
consolidating the code in a more logical sequence of City rules, procedures and operations. This two-year effort also
resulted in the electronic conversion of all City Ordinances into an on-line database with enhanced search capabilities
and download access through the City’s website at www.ci.andover.mn.us under City Codes.
15)Council approval of a zoning change that reduced building pad size from 22,500 square feet/150’ x 150’ to 3,600
square feet. This change has resulted in an environmentally friendly enhancement by allowing builders to preserve
existing trees and leave wildlife habitats minimally impacted by new housing development.
16)In response to resident demands for safer student walking areas, the Engineer Department designed and completed the
trail along Andover Boulevard from Bluebird Street to Hanson Boulevard. This trail segment safely allows students to
.
walk to Andover High School, Andover Elementary and Oakview middle School
17)The Fire Department along with the Anoka County Sheriffs Department and Ham Lake fire department co-hosted the
annual Kids Safety Camp in June. This year’s camp had a record attendance of 124 kids from all over the Andover,
Ham Lake, East Bethel and Oak Grove areas. The planning is already under way for next year’s camp.
Residential Development
The City continued to grow at a rate, which continues to create both immediate short-term and pressing long-term planning and
service related needs. In 2003, the City reviewed plats for a number of new residential developments including Villas of Andover
Station (75 townhouse units), Bunker Lake Village (41 small single family lots), Oakview Park (27 lots), Sophie’s Addition (46
lots), Crosstown Meadows (16 townhouse units), Whitetail Ridge (100 lots), Woodland Estates Sixth Addition (90 lots), and
Donohue Creekside Addition (2 lots). These plats included a total of 397 single family lots and townhouse units. Private
development activities in a number of subdivisions such as Aztec Estates, Nature’s Run, Sunridge, City View Farm, Grey Oaks,
Constance Corners, Foxburgh Crossing, Shady Oak Cove, Maple Hollow, Woodland Creek Golf Villas and Woodland Estates
Fourth Addition will require City technical oversight in a variety of different areas.
To the Honorable Mayor and City Council
City of Andover, Minnesota
Commercial Industrial Development
Review of commercial developments also increased in 2003 with review of Andover Marketplace East, Andover Clocktower
Commons, Molly Professional Office Building Phase II, Constance Free Church Addition, Coon Rapids Christian Church and
Fairbanks Properties retail building. These projects total 244,000 square feet of office retail and restaurant space and 44,800
square feet of institutional space with potential expansion for each sector in the future.
FOR THE FUTURE.
The City continues to focus on quality of life improvements throughout the City. These efforts cover a
broad array of areas including, protecting and improving the environment, revitalization of parks and public areas, expanding
recreational opportunities, providing cost-effective city services, increased communication between city representatives and the
public and added commercial/retail opportunities.
The City introduced a Customer Service Satisfaction Program to measure the level of customer satisfaction with City services
and programs, continues to effectively use the City newsletter to provide citizens with up to date information on all aspects of
city government and programs. Additionally, accessibility to information and programs through the City’s webpage
(www.ci.andover.mn.us) is continually being upgraded.
FINANCIAL INFORMATION
INTERNAL CONTROL.
The City's accounting system was developed and is continually evaluated to assure the adequacy of
internal accounting controls. Internal accounting controls are designed to provide reasonable but not absolute assurance in the
areas of: (1) safeguarding assets against loss from unauthorized use or disposition; and (2) reliability of financial records and
convenience of access for preparing financial statements and maintaining accountability for assets. The concept of reasonable
assurance adopted by the City of Andover recognizes that: (1) the evaluation of cost and benefits requires estimates and
judgments by management; and (2) the cost of a control should not exceed the benefits likely to be derived. All internal controls
are evaluated against the above criteria. It is our belief that the City's internal accounting controls adequately safeguard the City's
assets and also provide reasonable assurance of properly recording financial transactions
BUDGETING CONTROLS.
In addition to internal accounting controls, the City maintains budgetary controls. The objective
of these budgetary controls is to ensure compliance with legal provisions embodied in the annual budget approved by the City
Council. Activities of the General Fund and Special Revenue Funds are included in the annual budget.
As demonstrated by the statements and schedules included in the financial section of this report, the City continues to meet its
responsibility for sound financial management.
CASH MANAGEMENT.
Cash temporarily idle during the year was invested in demand deposits, certificates of deposit, U.S.
government and agency securities, state and local government securities and commercial paper.
The City's investment policy is to minimize credit and market risks while maintaining a competitive yield on its portfolio.
Accordingly, deposits are required to be insured by federal depository insurance or collateralized. The City, its agent or a
financial institution’s trust department in the City’s name held all collateral on deposits.
RISK MANAGEMENT.
The City Finance Director performs the duties of risk management. The Finance Director continually
reviews the City's exposures to losses, evaluates insurance specifications, coordinates with an insurance broker the placement and
renewal of coverage and reviews programs to reduce costs and improve cash flow. Although the City experiences population
growth, additional miles of road, payroll, and expenditures increases, the City has been able to keep insurance costs fairly flat
over the past four years.
OTHER INFORMATION
AWARDS.
The Government Finance Officers Association (GFOA) of the United States and Canada presented a Distinguished
Budget Presentation Award to the City of Andover for it’s annual budget for the fiscal year beginning January 1, 2003. This is
the second year in a row the City of Andover has received this award. In order to receive this award, a governmental unit must
publish a budget document that meets program criteria as a policy document, as an operations guide, as a financial plan and as a
communications device. This award is valid for a period of one year only. We believe that the annual budget for the fiscal year
beginning January 1, 2004 continues to conform to the program requirements and have submitted it to the GFOA to determine its
eligibility for another award.
To the Honorable Mayor and City Council
City of Andover, Minnesota
The GFOA also presented the Certificate of Achievement for Excellence in Financial Reporting Award to the City of Andover
for its 2002 Comprehensive Annual Financial Report. This was the first time the City of Andover has received this award. In
order to receive this award, a government unit must publish an easily readable and efficiently organized comprehensive annual
financial report whose contents conform to program standards. Such reports must satisfy both generally accepted accounting
principles and applicable legal requirements. This award is valid for a period of one year only. We believe this report for 2003
continues to conform to the Certificate of Achievement Program requirements and have submitted it to the GFOA to determine
its eligibility for another award.
INDEPENDENT AUDIT.
State statutes require an annual audit by independent certified public accountants. HLB Tautges
Redpath, Ltd. was engaged by the City to render an opinion on the City's financial statements. The auditor's report on the basic
financial statements and combining and individual fund statements and schedules is included in the financial section of this
report.
ACKNOWLEDGMENTS.
The preparation of this report could not have been accomplished without the efficient services of
the Finance Department staff and the consultation of the City's auditing firm. Staff members, Lee Brezinka, Deanna Connoy,
Charlene Welu, Shirley Clinton, and Brenda Fildes have my sincere appreciation for their contribution to the preparation of this
report.
I also want to express our appreciation to the Mayor, members of the City Council and the City Administrator, John Erar, for
their interest and support in planning and conducting the financial operations of the City in a responsible and progressive manner.
Respectfully submitted,
James Dickinson
Finance Director
CITY OF ANDOVER, MINNESOTA
ORGANIZATION
December 31, 2003
OfficeName
Term
MayorMichael GamacheJanuary 4, 2005
Council MemberDon JacobsonJanuary 1, 2007
Council MemberMichael KnightJanuary 4, 2005
Council MemberKen OrttelJanuary 4, 2005
Council MemberJulie TrudeJanuary 1, 2007
City AdministratorJohn ErarAppointed
Community Development DirectorWill NeumeisterAppointed
City EngineerDavid BerkowitzAppointed
Finance DirectorJames DickinsonAppointed
Building OfficialDon OlsonAppointed
Public Works SuperintendentFrank StoneAppointed
Fire ChiefDan WinkelAppointed
City ClerkVicki VolkAppointed
AttorneyWilliam G. Hawkins & AssociatesAppointed
Fiscal ConsultantsEhlers & Associates, Inc.Appointed
CITY OF ANDOVER
Organizational Chart
Certificate of
Achievement
for Excellence
~
in Financial
Reporting
Presented to
City of Andover,
Minnesota
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
"
December 31, 2002
A Certificate of Achievement for Excellence in Financial
ReportiJ;lg is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and fmancial reporting.
~
President
~/~
Executive Director
12
II. FINANCIAL SECTION
11II Tautges Redpath, Ltd.
Certified Public Accountants and Consultants
INDEPENDENT AUDITOR'S REPORT
To the Honorable Mayor and
Members of the City Council
City of Andover, Minnesota
We have audited the accompanying financial statements of the governmental activities, the
business-type activities, each major fund, and the aggregate remaining fund information of
the City of Andover, Minnesota, as of and for the year ended December 31, 2003 which
collectively comprise the City's basic financial statements as listed in the table of contents.
These financial statements are the responsibility of the City of Andover, Minnesota's
management. Our responsibility is to express an opinion on these basic financial statements
based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the
United States of America and the standards applicable to financial audits contained in
Government Auditing Standards, issued by the Comptroller General of the United States.
Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the fmancial statements referred to above present fairly, in all material
respects, the respective financial position of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information of the City of
Andover, Minnesota, as of December 31, 2003, and the respective changes in financial
position and cash flows, where applicable, thereof for the year then ended in conformity with
accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued a report dated
March 15,2004 on our consideration of the City of Andover, Minnesota's internal control
over financial reporting and our tests of its compliance with certain provisions of laws,
regulations, contracts and grants. That report is an integral part of an audit performed in
accordance with Government Auditing Standards and should be read in conjunction with this
report in considering the results of our audit.
White Bear Lake Office: 481 0 White Bear Parkway, White Bear Lake, Minnesota 55110, USA Telephone: 651 4267000 Fax: 651 4265004
Hastings Office: 1303 South Frontage Road, Suite 13, Hastings, MN 55033, USA Telephone: 651 4804990 Fax: 651 4265004
HlB Tautges Redpath. ltd. is a member of IIIIIlnl€rnational. A world-wide organization of accounting firms and business advisers.
14
The Management's Discussion and Analysis, the budgetary information and the modified
approach information on pages 16 through 24 and 76 through 79, respectively, are not a
required part of the basic fmancial statements but are supplementary information required by
the Governmental Accounting Standards Board. We have applied certain limited procedures,
which consisted principally of inquiries of management regarding the methods of
measurement and presentation of the required supplementary information. However, we did
not audit the information and express no opinion on it.
Our audit was conducted for the purpose of forming an opinion on the financial statements
that collectively comprise the City of Andover, Minnesota's basic financial statements. The
introductory section, combining and individual fund statements and schedules, supplementary
financial information and statistical information as listed in the table of contents are
presented for purposes of additional analysis and are not a required part of the basic financial
statements. The combining and individual fund statements and schedules and supplemental
financial information have been subjected to the auditing procedures applied in the audit of
the basic financial statements and, in our opinion, is fairly stated in all material respects, in
relation to the basic financial statements taken as a whole. The introductory section and
statistical section have not been subjected to the auditing procedures applied in the audit of
the basic financial statements and, accordingly, we express no opinion on them.
March 15,2004
#Lg ~ I~ ifl
HLB TAUTGES REDPATH, LTD.
Certified Public Accountants
15
MANAGEMENT’S DISCUSSION AND ANALYSIS
As management of the City of Andover, we offer readers of the City of Andover’s financial statements this narrative overview and analysis
of the financial activities of the City for the fiscal year ended December 31, 2003. We encourage readers to consider the information
presented here in conjunction with additional information that we have furnished in our letter of transmittal, which can be found on pages 2
through 9 of this report.
Financial Highlights
The assets of the City of Andover exceeded its liabilities at the close of the most recent fiscal year by $121,926,269 (Net assets). Of this
amount, $21,890,432 (unrestricted net assets) may be used to meet the government’s ongoing obligations to citizens and creditors in
accordance with the City's fund designations and fiscal policies.
The City’s total net assets increased by $4,063,542, primarily due to the addition of utility infrastructure.
As of the close of the current fiscal year, the City of Andover’s governmental funds reported combined ending fund balances of $19,676,042.
SpecialDebtCapital
GeneralRevenueServiceProjectsTotals
Reserved$87,766$-$1,567,365$609,339$2,264,470
Designated2,505,2611,207,537-14,698,49518,411,293
Undesignated-18,089(9,706)(1,008,104)(999,721)
$2,593,027$1,225,626$1,557,659$14,299,730$19,676,042
The City’s total long-term liabilities increased by $823,658 during the current fiscal year, from $37,987,843 to $38,811,501.
BeginningEnding
BalanceAdditionsReductionsBalance
Governmental activities:
Bonds payable$27,845,000$6,904,000$(6,124,000)$28,625,000
Compensated absences314,213246,644(213,323)347,534
Total governmental activities28,159,2137,150,644(6,337,323)28,972,534
Business-type activities:
Bonds payable9,780,000--9,780,000
Compensated absences48,63047,745(37,408)58,967
Total business-type activities9,828,63047,745(37,408)9,838,967
Total City long-term liabilities$37,987,843$7,198,389$(6,374,731)$38,811,501
Overview of the Financial Statements
The discussion and analysis are intended to serve as an introduction to the City of Andover’s basic financial statements. The City’s basic
financial statements comprise three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the
financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves.
Government-wide financial statements
. The government-wide financial statements are designed to provide readers with a broad overview
of the City of Andover’s finances, in a manner similar to a private-sector business.
The statement of net assets presents information on all of the City of Andover’s assets and liabilities, with the difference between the two
reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the
City of Andover is improving or deteriorating.
Management’s Discussion and Analysis
The statement of activities presents information showing how the City’s net assets changed during the most recent fiscal year. All changes in
net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus,
revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g.
uncollected taxes and earned but unused vacation leave).
Both of the government-wide financial statements distinguish functions of the City of Andover that are principally supported by taxes and
intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their
costs through user fees and charges (business-type activities). The governmental activities of the City of Andover include general
government, public safety, public works, sanitation, parks and recreation, recycling and economic development. The business-type activities
of the City of Andover include water, sewer and storm sewer.
The government-wide financial statements can be found on pages 27 through 29 of this report.
Fund Financial statements
. A fund is a grouping of related accounts that is used to maintain control over resources that have been
segregated for specific activities or objectives. The City of Andover, like other state and local governments, uses fund accounting to ensure
and demonstrate compliance with finance-related legal requirements. All of the funds of the City of Andover can be divided into three
categories: governmental funds, proprietary funds, and fiduciary funds.
Governmental funds
. Governmental funds are used to account for essentially the same functions reported as governmental activities in the
government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements
focus on near-term inflows and outflows of spend-able resources, as well as on balances of spend-able resources available at the end of the
fiscal year. Such information may be useful in evaluating a government’s near-term financial requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the
information presented for governmental funds with similar information presented for governmental activities in the government-wide
financial statement. By doing so, readers may better understand the long-term impact of the City's near term financial decisions. Both the
governmental fund balance sheet and governmental fund statement of revenues, expenditures, and change in fund balances provide a
reconciliation to facilitate this comparison between governmental funds and governmental activities.
The City of Andover maintains seven individual major governmental funds. Information is presented separately in the governmental fund
balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the following major funds:
General fund; TIF Commercial Revitalization Debt Service Fund (DSF); and the following capital projects funds (CPF): Water Trunk,
Sewer Trunk, Road and Bridge, Building Fund and Permanent Improvement Revolving.
Data from the other governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these non-
major governmental funds is provided in the form of combining statements elsewhere in this report.
The City of Andover adopts an annual appropriated budget for its general and special revenue funds.
A budgetary comparison statement has been provided for those funds to demonstrate compliance with this budget.
The basic governmental fund financial statements can be found on pages 30 through 35 of this report.
Proprietary funds
. When the City charges customers for the services it provided – whether to outside customers or to other departments of
the City – these services are generally reported in proprietary funds. Proprietary funds are reported in the same way that all activities are
reported in the statement of net assets and the statement of revenues, expenses and changes in net assets.
The enterprise funds are the same as the business-type activities reported in the government-wide statements but provide more detail and
additional information, such as cash flows, for proprietary funds. The City of Andover uses enterprise funds to account for its water, sanitary
sewer and storm sewer operations.
Internal service funds are used to report activities that provide supplies and services for the City’s other departments, such as the equipment
maintenance and insurance funds. The internal service funds are reported with governmental activities in the government-wide financial
statements.
The basic proprietary fund financial statements can be found on pages 36 through 41 of this report.
Fiduciary funds
. Fiduciary funds are used to account for resources held for the benefit of parties outside the government. Fiduciary funds
are not reflected in the government-wide financial statements because the resources of those funds are not available to support the City of
Andover’s own program. The accounting used for fiduciary funds is much like that used for proprietary funds.
The basic fiduciary fund financial statement can be found on page 42 of this report.
Management’s Discussion and Analysis
Notes to the financial statements
. The notes provide additional information that is essential to a full understanding of the data provided in
the government–wide and fund financial statements. The notes to the financial statements can be found on pages 43 through 73 of this report.
Other information.
The combining statements referred to earlier in connection with non-major governmental funds is presented
immediately following the required supplementary information on budgetary comparisons, and on the modified approach for streets and trails
infrastructure. Combining and individual fund statements and schedules can be found on pages 83 through 120 of this report.
Government-wide Financial Analysis
As noted earlier, net assets may serve over time as a useful indictor of a government's financial position. In the case of the City of Andover,
assets exceeded liabilities by $121,926,269 at the close of the most recent fiscal year.
The largest portion of the City of Andover’s net assets ($95,320,925 or 78 percent) reflects its investment in capital assets (e.g. land,
buildings, machinery, and equipment) less any related debt used to acquire those assets that is still outstanding. The City of Andover uses
these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City of
Andover's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must
be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.
CITY OF ANDOVER’S NET ASSETS
Governmental ActivitiesBusiness-Type ActivitiesTotals
200220032002200320022003
Current and other assets$23,718,986$27,347,243$8,272,751$3,447,513$31,991,737$30,794,756
Capital assets93,236,46691,026,35933,190,99143,339,802126,427,457134,366,161
Total assets116,955,452118,373,60241,463,74246,787,315158,419,194165,160,917
Long-term liabilities
outstanding28,159,21328,972,5349,828,6309,838,96737,987,84338,811,501
Other liabilities1,739,6034,189,504829,021233,6432,568,6244,423,147
Total liabilities29,898,81633,162,03810,657,65110,072,61040,556,46743,234,648
Net assets:
Invested in capital assets,
net of related debt64,911,47961,941,54123,170,43433,379,38488,081,91395,320,925
Restricted5,882,4514,277,8354,337,170437,07710,219,6214,714,912
Unrestricted16,262,70618,992,1883,298,4872,898,24419,561,19321,890,432
Total net assets$87,056,636$85,211,564$30,806,091$36,714,705$117,862,727$121,926,269
A portion of the City of Andover's net assets represents resources that are subject to external restrictions on how they may be used. The
remaining balance of unrestricted net assets ($21,890,432) may be used to meet the City's ongoing obligations to citizens and creditors.
At the end of the current fiscal year, the City of Andover is able to report positive balances in all three categories of net assets, both for the
government as a whole, as well as for its separate governmental and business-type activities.
Management’s Discussion and Analysis
Government-wide Activities
Governmental activities decreased the City of Andover's net assets by $1,845,072 and business-type activities increased net assets by
$5,908,614. Key elements of the activities are as follows:
City of Andover's Changes in Net Assets
Governmental ActivitiesBusiness-Type ActivitiesTotal
200220032002200320022003
Revenues:
Program revenues:
Charges for services$1,801,772$1,721,434$2,378,114$2,828,020$4,179,886$4,549,454
Operating grants
and contributions946,495732,011--946,495732,011
Capital grants
and contributions5,849,6835,350,283373,550-6,223,2335,350,283
General revenues:
Property taxes5,076,3745,682,498--5,076,3745,682,498
Tax increment842,6071,140,040--842,6071,140,040
Grants and contributions
not restricted to
specific programs763,049158,694--763,049158,694
Unrestricted investments
earnings821,002568,042458,311(94,931)1,279,313473,111
Total revenues16,100,98215,353,0023,209,9752,733,08934,663,95921,296,066
Expenses:
General government2,386,5682,431,252--2,386,5682,431,252
Public safety2,474,2842,766,694--2,474,2842,766,694
Public works4,819,4293,361,255--4,819,4293,361,255
Sanitation264,671160,548--264,671160,548
Parks and recreation856,806802,131--856,806802,131
Recycling116,344115,016--116,344115,016
Economic development720,460470,172--720,460470,172
Interest on long-term debt1,667,9431,255,888--1,667,9431,255,888
Water--1,526,5261,737,5961,526,5261,737,596
Sewer--1,206,8651,344,8571,206,8651,344,857
Storm sewer---168,203-168,203
Total expenses13,306,50511,362,9562,733,3913,250,65616,039,89614,613,612
Increase (decrease) in net
assets before gain on the
sale of capital assets and
transfers2,794,4773,990,046476,584(517,567)3,271,0613,472,479
Gain on the sale of
capital assets1,316,054591,063--1,316,054591,063
Transfers770,062(6,426,181)(770,062)6,426,181--
Increase in net assets4,880,593(1,845,072)(293,478)5,908,6144,587,1154,063,542
Net assets - January 182,176,04387,056,63631,099,56930,806,091113,275,612117,862,727
Net assets - December 31$87,056,636$85,211,564$30,806,091$36,714,705$117,862,727$121,926,269
Management’s Discussion and Analysis
Below are specific graphs which provide comparisons of the governmental activities revenues and expenditures:
Governmental Activities - Revenues
Unrestricted
Charges for services
Grants and
investments earnings
11%
contributions not
4%
Tax increment
restricted for specific
7%
programs
1%
Capital grants and
Property taxes
contributions
37%
35%
Operating grants and
contributions
5%
Governmental Activities - Expenses
Interest on long-term
debt
Economic
11%
General government
development
21%
4%
Parks and recreation
7%
Recycling
Sanitation
1%
1%
Public safety
24%
Public works
31%
Management’s Discussion and Analysis
Business-Type Activities
Business-type activities increased net assets by $5,908,614. Below are graphs showing the business-type activities revenue and expense
comparisons:
Business-Type Activities - Revenues
Unrestricted
investments earnings
3%
Charges for services
97%
Business-Type Activities - Expenses
Storm sewer
5%
Sewer
Water
41%
54%
Management’s Discussion and Analysis
Financial Analysis of the Government's Funds
Governmental Funds
. The focus of the City of Andover’s governmental funds is to provide information on near-term inflows, outflows,
and balances of spendable resources. Such information is useful in assessing the City of Andover’s financing requirements. In particular,
unreserved fund balance may serve as useful measure of a government’s net resources available for spending at the end of the fiscal year.
At the end of the current fiscal year, the City of Andover's governmental funds reported combined ending fund balances of $19,676,042.
Approximately 88 percent of this total amount ($17,411,572) constitutes unreserved fund balance. The remainder of the fund balance
($2,264,470) is reserved because it has already been committed 1) to provide for prepaid items ($3,239), 2) to provide for inventory
($84,527), 3) to provide for an interfund loan ($150,000), 4) to pay debt service ($1,567,365) and 5) bond proceeds specified for a project
($459,339).
The general fund decreased by $221,945 in 2003, which was directly related to the state aid cuts passed on to local governments ($589,933)
and the budgeted use of fund balance ($300,294). To provide a short-term fix to state aid cuts in 2004, the tax levy was increased.
The water trunk, sewer trunk, road & bridge and permanent improvement revolving capital projects fund increased primarily due to the
prepayments of assessments on improvement projects.
The building fund capital projects fund decreased by $266,220 for 2003 due to preliminary construction fees associated with a community
center project.
Proprietary funds
. The City of Andover’s proprietary funds provide the same type of information found in the government-wide financial
statements, but in more detail.
The unrestricted net assets in the respective proprietary funds are enterprise funds of $2,878,375 (water $1,569,423, sewer $1,268,468 and
storm sewer $40,484) and internal service funds of $281,495. The water and storm sewer enterprise funds had increases in net assets in 2003
of $281,166 and $6,054,354 respectively, while the sewer enterprise fund net assets decreased $436,009. The significant increase for the
stormsewer fund reflects the inaugural year of the fund and the recognition of the infrastructure. The internal service funds had increases in
net assets of $43,487.
Budgetary Highlights
General Fund
The revenue and expenditure budget was amended due to the state budget reductions affecting local government aid ($119,842) and market
value homestead credit aid ($470,108) directly related to the City. The budget was also amended mid-year for the creation of a storm water
enterprise fund previously accounted for in the general fund.
Capital Asset and Debt Administration
Capital assets
. The City of Andover’s investment in capital assets for its governmental and business type activities as of December 31,
2003, amounts to $134,366,161 (net of accumulated depreciation). This investment in capital assets includes land, buildings, infrastructure,
machinery and equipment.
The City has elected to use the modified approach as defined in GASB Statement No. 34 for infrastructure reporting for its Pavement
Management Program, which includes streets and trails. Under GASB Statement No. 34, eligible infrastructure capital assets are not required
to be depreciated under the following requirements:
1)The City manages the eligible infrastructure capital assets using an asset management system with characteristics of (a) an up to-
date inventory; (2) perform condition assessments and summarize the results using a measurement scale; and (3) estimate annual
amount to maintain and preserve at the established condition assessment level.
2)The City documents that the eligible infrastructure capital assets are being preserved approximately at or above the established and
disclosed condition assessment level.
The City’s policy is to achieve an average rating of good (56 – 70) for all streets and trails. In the fall of 2002, the City conducted a physical
condition assessment of the streets and trails. This assessment will be performed every three years. As of December 31, 2002, the City’s
street and trail system was rated at an Overall Condition Index (OCI) of 82, which is higher than the City’s policy level. The City’s streets
and trails are constantly deteriorating resulting from the following factors: (1) traffic using the system; (2) the sun’s ultra-violet rays drying
out and breaking down the top layer of pavement; (3) utility company/private development trenching operations; (4) water damage from
natural precipitation; and (5) frost heave. The City is continuously taking actions to prolong the life of the system through short-term
maintenance activities such as pothole patching, crack sealing, seal coating and overlaying. The City expended $956,688 on street and trail
Management’s Discussion and Analysis
maintenance for the year ending December 31, 2003. These expenditures delayed deterioration; however, the overall condition of the system
was not improved through these maintenance expenditures. The City has estimated that the amount of annual expenditures required to
maintain the City’s street and trail system at the average OCI rating of good is approximately $950,000.
BeginningEnding
Primary Government
BalanceAdditionsDeletionsBalance
Governmental activities:
Land and improvements$8,013,110$453,717$(198,674)$8,268,153
Streets and trails69,740,833867,955-70,608,788
Construction in progress1,162,1373,537,401(1,045,212)3,654,326
Buildings and improvements5,710,212126,556(84,393)5,752,375
Furniture and equipment59,38728,228-87,615
Machinery and equipment5,399,634199,839(509,122)5,090,351
Other park improvements2,774,922235,797(10,000)3,000,719
Storm sewers7,045,960-(7,045,960)-
Total capital assets 99,906,1955,449,493(8,893,361)96,462,327
Less accumulated depreciation for:
Buildings and improvements1,567,271199,506(84,393)1,682,384
Furniture and equipment55,7302,456-58,186
Machinery and equipment2,528,025428,365(234,800)2,721,590
Other park improvements863,896115,912(6,000)973,808
Storm sewers1,654,80777,031(1,731,838)-
Total accumulated depreciation6,669,729823,270(2,057,031)5,435,968
Governmental activities
capital assets - net93,236,4664,626,223(6,836,330)91,026,359
Business-type activities:
Land and improvements196,387196,400-392,787
Construction in progress6,094,1133,600,224(590,114)9,104,223
Buildings and improvements4,402,174333,752-4,735,926
Furniture and equipment29,3559,280-38,635
Machinery and equipment489,477411,365-900,842
Collection and distribution31,490,9729,031,969-40,522,941
Total capital assets
being depreciated42,702,47813,582,990(590,114)55,695,354
Less accumulated depreciation for:
Buildings and improvements1,990,476190,553-2,181,029
Furniture and equipment29,355464-29,819
Machinery and equipment339,126200,151-539,277
Collection and distribution7,152,5302,452,897-9,605,427
Total accumulated depreciation9,511,4872,844,065-12,355,552
Business-type activities
capital assets - net33,190,99110,738,925(590,114)43,339,802
Total capital assets$126,427,457$15,365,148$(7,426,444)$134,366,161
Additional information on the City of Andover’s capital assets can be found in Note 5.
Long-term debt
. At the end of the current fiscal year, the City of Andover had total long-term debt outstanding of $38,811,501, an increase
of $823,658 from 2002. General obligation revenue bonds ($11,825,000) were used to finance the addition to the public works facility and
the water treatment facility (currently being constructed). Special assessment bonds ($1,255,000) financed improvement projects within the
City and are assessed to the benefiting properties. Tax increment bonds ($9,815,000) financed the City’s economic development plan.
Management’s Discussion and Analysis
Certificates of indebtedness ($1,665,000) financed capital equipment purchases. Permanent improvement revolving bonds ($11,375,000)
financed improvement projects within the City and are assessed to the benefiting properties. State aid bonds ($2,470,000) were used to
finance Municipal State Aid (MSA) eligible road projects.
Additional long-term debt in the amount of $406,501 is for compensated absences.
City of Andover’s Outstanding Debt
GovernmentalBusiness-Type
ActivitiesActivitiesTotal
Bonds payable:
G.O. revenue bonds$2,045,000$9,780,000$11,825,000
Special assessment bonds1,255,000-1,255,000
Tax increment bonds9,815,000-9,815,000
Certificates of indebtedness1,665,000-1,665,000
Permanent improvement revolving bonds11,375,000-11,375,000
State aid bonds2,470,000-2,470,000
Total bonds payable28,625,0009,780,00038,405,000
Compensated absences347,53458,967406,501
Total$28,972,534$9,838,967$38,811,501
The City of Andover maintains an A+ rating with a stable outlook from Standard and Poor’s.
State statutes limit the amount of general obligation debt a Minnesota city may issue to 2% of total Estimated Taxable Market Value. The
current debt limitation for the City of Andover is $39,325,686. Only $3,627,485 of the City's outstanding debt is counted within the statutory
limitation.
Additional information on the City of Andover’s long-term debt can be found in Note 6.
Requests for information.
This financial report is designed to provide a general overview of the City of Andover’s finances for all those
with an interest in the government’s finances. Questions concerning any of the information provided in this report or requests for additional
financial information should be addressed to the City of Andover, Attn: Finance Director, 1685 Crosstown Boulevard NW, Andover,
Minnesota 55304 or by calling 763-755-5100.
BASIC FINANCIAL STATEMENTS
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CITY OF ANDOVER, MINNESOTA
STATEMENT OF NET ASSETSStatement 1
December 31, 2003
Primary Government
Totals (Memorandum Only)
GovernmentBusiness-Type
ActivitiesActivities20032002
Assets:
Cash and investments$23,043,924$2,611,544$25,655,468$25,677,672
Restricted assets:
Cash and investments---45,504
Accrued interest66,3537,95374,30686,522
Due from other governmental units78,5761,35879,93497,581
Accounts receivable - net100,686730,939831,625742,911
Prepaid items47,81952,867100,68691,353
Property taxes receivable:
Unremitted184,797-184,79770,181
Delinquent124,610-124,610109,923
Special assessments receivable:
Unremitted10,76726211,0294,167
Delinquent43,6315,69849,32937,404
Deferred3,496,053-3,496,0534,820,961
Notes receivable15,595-15,59537,943
Inventories - at cost134,43236,892171,324169,615
Capital assets - net
Nondepreciable82,531,2679,497,01092,028,27785,206,580
Depreciable8,495,09233,842,79242,337,88441,220,877
Total assets118,373,60246,787,315165,160,917158,419,194
Liabilities:
Interfund payable19,869(19,869)--
Accounts payable91,88827,432119,320107,376
Contracts payable705,49412,164717,658879,484
Developer advances2,197,711-2,197,711-
Deposits payable2,7005,5348,2344,000
Due to other governmental units109,0316,815115,846257,857
Salaries payable121,32521,149142,474131,317
Unearned revenue481,668-481,668468,046
Accrued interest payable459,818180,418640,236720,544
Compensated absences:
Due in more than one year347,53458,967406,501362,843
Bonds/notes payable:
Due within one year6,919,000310,0007,229,0004,415,000
Due in more than one year21,706,0009,470,00031,176,00033,210,000
Total liabilities33,162,03810,072,61043,234,64840,556,467
Net assets:
Invested in capital assets, net of related debt61,941,54133,379,38495,320,92588,081,913
Restricted for:
Debt service2,173,972-2,173,9722,816,396
Capital improvements458,290437,077895,3675,236,408
Tax increment purposes1,645,573-1,645,5732,166,817
Unrestricted18,992,1882,898,24421,890,43219,561,193
Total net assets$85,211,564$36,714,705$121,926,269$117,862,727
The accompanying notes are an integral part of these financial statements.
CITY OF ANDOVER, MINNESOTA
STATEMENT OF ACTIVITIES
For The Year Ended December 31, 2003
Program Revenues
ChargesOperatingCapital
ForGrants andGrants and
ExpensesServicesContributionsContributions
Functions/Programs
Primary government:
Government activities:
General government$2,431,252$593,568$-$47,515
Public safety2,766,694793,306239,451-
Public works3,361,255312,110197,9604,933,417
Sanitation160,548---
Parks and recreation802,131--369,351
Recycling115,01622,45055,570-
Economic development470,172---
Interest on long-term debt1,255,888-239,030-
Total government activities11,362,9561,721,434732,0115,350,283
Business-type activities:
Water1,737,5961,399,798--
Sewer1,344,8571,309,584--
Storm sewer168,203118,638--
Total business-type activities3,250,6562,828,020--
Total primary government$14,613,612$4,549,454$732,011$5,350,283
The accompanying notes are an integral part of these financial statements.
Statement 2
Net (Expense) Revenue and Changes in Net Assets
Primary Government
Totals (Memorandum Only)
GovernmentalBusiness-Type
ActivitiesActivities20032002
$(1,790,169)$-$(1,790,169)$(1,800,378)
(1,733,937)-(1,733,937)(1,357,634)
2,082,232-2,082,2321,467,194
(160,548)-(160,548)(264,671)
(432,780)-(432,780)(571,479)
(36,996)-(36,996)(31,214)
(470,172)-(470,172)(720,460)
(1,016,858)-(1,016,858)(1,429,913)
(3,559,228)-(3,559,228)(4,708,555)
-(337,798)(337,798)(219,278)
-(35,273)(35,273)237,551
-(49,565)(49,565)-
-(422,636)(422,636)18,273
(3,559,228)(422,636)(3,981,864)(4,690,282)
General revenues:
General property taxes5,682,498-5,682,4985,076,374
Tax increment collections1,140,040-1,140,040842,607
Grants and contributions not
restricted to specific programs158,694-158,694763,049
Unrestricted investment earnings568,042(94,931)473,1111,279,313
Gain on sale of capital assets591,063-591,0631,316,054
Transfers(6,426,181)6,426,181--
Total general revenues, gain on sale of
capital assets and transfers1,714,1566,331,2508,045,4069,277,397
Change in net assets(1,845,072)5,908,6144,063,5424,587,115
Net assets - beginning87,056,63630,806,091117,862,727113,275,612
Net assets - ending$85,211,564$36,714,705$121,926,269$117,862,727
CITY OF ANDOVER, MINNESOTA
BALANCE SHEET
GOVERNMENTAL FUNDS
December 31, 2003
TIF
Commercial
RevitalizationWater TrunkSewer Trunk
GeneralDSFCPFCPF
Assets
Cash and investments$2,611,103$455,564$1,692,768$735,597
Accrued interest 5,2297134,9291,849
Due from other governmental units33,390---
Accounts receivable - net49,927---
Interfund receivable--120,000-
Prepaid items3,239---
Property taxes receivable:
Unremitted86,76233,806--
Delinquent91,95319,566--
Special assessments receivable:
Unremitted661,661-4,293
Delinquent1,85834,1961,311-
Deferred-107,94955,05915,348
Notes receivable----
Interfund loan receivable----
Inventory84,527---
Total assets2,968,054653,4551,874,067757,087
Liabilities and Fund Balances
Liabilities:
Interfund payable----
Accounts payable57,269---
Contracts payable11,978---
Developer advances----
Deposits payable2,700---
Due to other governmental units99,636---
Salaries payable106,060---
Interfund loan payable----
Deferred revenue97,384161,71156,37015,348
Total liabilities375,027161,71156,37015,348
Fund balances:
Reserved for:
Prepaid items3,239---
Inventory84,527---
Debt service-491,744--
Projects----
Interfund loan----
Unreserved reported in:
Designated:
General fund2,505,261---
Special revenue funds----
Capital projects funds--1,817,697741,739
Undesignated:
Special revenue funds----
Debt service funds----
Capital projects funds----
Total fund balances2,593,027491,7441,817,697741,739
Total liabilities and fund balances$2,968,054$653,455$1,874,067$757,087
Fund balance reported above
Amounts reported for governmental activities in the statement of net assets are different because:
Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds.
Other long-term assets are not available to pay for current-period expenditures and, therefore, are deferred in the funds.
Internal service funds are used by management to charge the cost of equipment maintenance and insurance to individual funds.
The assets and liabilities are included in the governmental activities statement of net assets along with a deduction of net
revenue attributable to business-type activities.
Long-term liabilities, including bonds payable, are not due and payable in the current period and, therefore, are not
reported in the funds.
Net assets of governmental activities
The accompanying notes are an integral part of these financial statements.
Statement 3
Permanent
Totals (Memorandum Only)
Road &ImprovementOtherIntra
BridgeBuilding FundRevolvingGovernmentalActivityGovernmental Funds
CPFCPFCPFFundsEliminations20032002
$2,082,754$14,254$9,511,901$5,741,356$-$22,845,297$18,001,163
7,39568429,50515,377-65,68161,026
3,604--41,582-78,57696,197
--3,75047,009-100,686162,584
635,000--20,000(775,000)--
-----3,2394,152
10,918--53,311-184,79770,181
---13,091-124,610109,923
228-5433,976-10,7674,135
752-295,485-43,63134,225
280,545-2,491,373545,779-3,496,0534,818,360
---15,595-15,59537,943
--150,000-(150,000)--
-----84,52768,175
3,021,19614,93812,187,1016,502,561(925,000)27,053,45923,468,064
---775,000(775,000)--
-5,23741824,568-87,49287,866
15,866261,206314,186102,258-705,494318,680
--2,197,711--2,197,711-
-----2,7001,900
-321,5336,831-108,032251,700
---8,371-114,431107,744
---150,000(150,000)--
281,297-2,491,4021,058,045-4,161,5575,468,497
297,163266,4755,005,2502,125,073(925,000)7,377,4176,236,387
-----3,2394,152
-----84,52768,175
---1,075,621-1,567,3651,665,451
---459,339-459,339899,238
--150,000--150,000-
-----2,505,2612,742,645
---1,207,537-1,207,5371,083,966
2,724,033-7,031,8512,383,175-14,698,49511,565,955
---18,089-18,089(1,804)
---(9,706)-(9,706)-
-(251,537)-(756,567)-(1,008,104)(796,101)
2,724,033(251,537)7,181,8514,377,488-19,676,04217,231,677
$3,021,196$14,938$12,187,101$6,502,561$(925,000)$27,053,459$23,468,064
$19,676,042$17,231,677
91,026,35993,236,466
3,679,8895,000,451
261,626227,242
(29,432,352)(28,639,200)
$85,211,564$87,056,636
CITY OF ANDOVER, MINNESOTA
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE
GOVERNMENTAL FUNDS
For The Year Ended December 31, 2003
TIF
Commercial
RevitalizationWater TrunkSewer Trunk
GeneralDSFCPFCPF
Revenues:
General property taxes$4,286,838$-$-$-
Tax increment collections-479,126--
Licenses and permits551,385---
Intergovernmental508,05440,074--
Special assessments-64,509766,758331,507
Charges for services647,813---
Fines68,686---
Investment income(6,407)(8,721)45,32834,135
Miscellaneous
Park dedication fees----
Connection charges--797,979246,773
Other226,868---
Total revenues6,283,237574,9881,610,065612,415
Expenditures:
Current:
General government1,915,314---
Public safety2,631,991---
Public works1,108,578-17,42011,625
Sanitation80,901---
Parks and recreation574,719---
Recycling114,784---
Economic development----
Unallocated25,865---
Capital outlay:
General government----
Public safety----
Public works17,714-39,578132,752
Sanitation----
Parks and recreation24,285---
Debt service:
Principal retirement-1,845,000--
Interest-336,863--
Paying agent fees-300--
Professional services-2,997--
Construction/acquisition costs----
Total expenditures6,494,1512,185,16056,998144,377
Revenues over (under) expenditures(210,914)(1,610,172)1,553,067468,038
Other financing sources (uses):
Transfers in165,0001,624,440350,000390,000
Transfers out(190,310)-(1,393,405)(127,957)
Bonds issued----
Bond premium----
Bond discount----
Proceeds from the sale of capital assets14,279---
Total other financing sources (uses)(11,031)1,624,440(1,043,405)262,043
Net increase (decrease) in fund balance(221,945)14,268509,662730,081
Fund balance - January 12,814,972477,4761,308,03511,658
Fund balance - December 31$2,593,027$491,744$1,817,697$741,739
The accompanying notes are an integral part of these financial statements.
Statement 4
Permanent
Totals (Memorandum Only)
Road &ImprovementOtherIntra
Governmental Funds
BridgeBuilding FundRevolvingGovernmentalActivity
CPFCPFCPFFundsEliminations20032002
$543,587$-$-$840,852$-$5,671,277$5,060,053
---657,448-1,136,574878,567
-----551,385588,965
17,735--324,842-890,7051,764,078
665,656-2,844,587448,619-5,121,6364,183,796
---215,981-863,794870,941
-----68,68673,475
70,7408,136327,29693,317-563,824812,896
---357,483-357,483280,312
-----1,044,7521,281,670
-47,515-138,369(20,000)392,752338,905
1,297,71855,6513,171,8833,076,911(20,000)16,662,86816,133,658
-116,987-149,053-2,181,3542,173,992
-----2,631,9912,352,909
501,715-869,211627,532-3,136,0814,603,715
-----80,901110,213
---38,359-613,078689,161
-----114,784116,005
---471,172-471,172720,960
-----25,86530,614
---28,228-28,22858,943
---129,825-129,825317,699
5,982-1,110,36094,336-1,400,722822,284
--191,391120,186-311,57765,215
-443,239-272,457-739,981701,132
---4,279,000-6,124,0007,070,000
---939,194-1,276,0571,768,509
---3,124-3,4243,415
---25,015-28,01224,850
-607,8532,721,376183,886-3,513,115758,953
507,6971,168,0794,892,3387,361,367-22,810,16722,388,569
790,021(1,112,428)(1,720,455)(4,284,456)(20,000)(6,147,299)(6,254,911)
-846,208333,7523,739,272(6,119,763)1,328,909754,062
--(1,873,608)(3,039,653)6,139,763(485,170)-
--4,580,0002,324,000-6,904,000-
---5,188-5,188-
--(3,169)--(3,169)-
---827,627-841,9062,139,961
-846,2083,036,9753,856,43420,0008,591,6642,894,023
790,021(266,220)1,316,520(428,022)-2,444,365(3,360,888)
1,934,01214,6835,865,3314,805,510-17,231,67720,592,565
$2,724,033$(251,537)$7,181,851$4,377,488$-$19,676,042$17,231,677
- This page intentionally left blank -
CITY OF ANDOVER, MINNESOTA
RECONCILIATION OF THE STATEMENT OF REVENUES,Statement 5
EXPENDITURES, AND CHANGES IN FUND BALANCES OF
GOVERNMENTAL FUNDS
For The Year Ended December 31, 2003
20032002
Amounts reported for governmental activities in the
statement of activities (page 33) are different because:
Net changes in fund balances - total governmental funds (page 33)$2,444,365$(3,360,888)
Governmental funds report capital outlays as expenditures. However, in the statement of
activities the cost of those assets is allocated over their estimated useful lives and reported
as depreciation expense. This is the amount by which capital outlays exceeded depreciation
in the current period.5,300,1781,862,617
The net effect of various miscellaneous transactions involving capital assets is to decrease
net assets (i.e., sales, trade-ins, and donations).(240,365)(450,357)
Revenues in the statement of activities that do not provide current financial resources are not
reported as revenues in the funds.(1,320,562)(22,782)
The issuance of long-term debt (e.g., bonds, leases) provides current financial resources to
governmental funds, while the repayment of the principal of long-term debt consumes the
current financial resources of governmental funds. Neither transaction, however, has any
effect on net assets. This amount is the net effect of these differences in the treatment of
long-term debt and related items.(780,000)7,070,000
Transfer out of governmental capital assets contributed to Enterprise Funds.(7,269,920)(373,550)
Some expenses reported in the statement of activities do not require use of current financial
resources and, therefore, are not reported as expenditures in governmental funds.(13,152)100,287
Internal service funds are used by management to charge the cost of equipment maintenance
and insurance to individual funds. This amount is the portion of net revenue attributable to
governmental activities.34,38455,266
Change in net assets of governmental activities (page 29)$(1,845,072)$4,880,593
The accompanying notes are an integral part of these financial statements.
CITY OF ANDOVER, MINNESOTA
STATEMENT OF NET ASSETS
PROPRIETARY FUNDS
December 31, 2003
WaterSewerStorm Sewer
Assets
Current assets:
Cash and cash equivalents$1,728,208$881,967$1,369
Restricted assets:
Cash and cash equivalents---
Accrued interest5,3602,593-
Due from other governmental units-858500
Accounts receivable - net302,009358,80170,129
Interfund receivable12,000--
Prepaid items-52,867-
Special assessments receivable:
Unremitted131131-
Delinquent2,2693,429-
Deferred---
Inventories - at cost36,892--
Total current assets2,086,8691,300,64671,998
Noncurrent assets:
Capital assets:
Land392,787--
Buildings and structures4,735,926--
Machinery and equipment252,010311,903375,564
Distribution and collection system12,844,56820,067,1847,611,189
Construction in progress9,104,223--
Total capital assets27,329,51420,379,0877,986,753
Less: Allowance for depreciation(4,998,159)(5,384,510)(1,972,883)
Total noncurrent assets22,331,35514,994,5776,013,870
Total assets24,418,22416,295,2236,085,868
Liabilities
Current liabilities:
Interfund payable--12,000
Accounts payable21,4423,0912,899
Contracts payable5,689-6,475
Deposits payable5,534--
Interest payable180,418--
Due to other governmental units2,6353,842338
Salaries payable11,3177,2372,595
Bonds payable - due within one year310,000--
Total current liabilities537,03514,17024,307
Noncurrent liabilities:
Bonds payable - due in more than one year9,470,000--
Compensated absences payable 33,75218,0087,207
Total noncurrent liabilities9,503,75218,0087,207
Total liabilities10,040,78732,17831,514
Net assets
Invested in capital assets, net of related debt12,370,93714,994,5776,013,870
Restricted437,077--
Unrestricted1,569,4231,268,46840,484
Total net assets$14,377,437$16,263,045$6,054,354
Net assets reported above
Amounts reported for business-type activities in the statement of net assets are different because:
Internal service funds are used by management to charge the cost of equipment maintenance
and insurance to individual funds. This amount is the portion of net revenue attributable to
business-type activities.
Net assets of business-type activities
The accompanying notes are an integral part of these financial statements.
Statement 6
Totals
IntraGovernmental Activities -
TotalsInternal Service Funds
Activity
Eliminations2003200220032002
$-$2,611,544$7,507,752$198,627$168,757
--45,504--
-7,95324,939672557
-1,3581,384--
-730,939580,327--
(12,000)----
-52,86751,35044,58035,851
-26232--
-5,6983,179--
--2,601--
-36,89255,68349,90545,757
(12,000)3,447,5138,272,751293,784250,922
-392,787196,387--
-4,735,9264,402,174--
-939,477518,832--
-40,522,94131,490,972--
-9,104,2236,094,113--
-55,695,35442,702,478--
-(12,355,552)(9,511,487)--
-43,339,80233,190,991--
(12,000)46,787,31541,463,742293,784250,922
(12,000)----
-27,43214,1514,3965,359
-12,164560,804--
-5,5342,100--
-180,418240,557--
-6,8155,299999858
-21,14916,8766,8946,697
-310,000---
(12,000)563,512839,78712,28912,914
-9,470,0009,780,000--
-58,96748,630--
-9,528,9679,828,630--
(12,000)10,092,47910,668,41712,28912,914
-33,379,38423,170,434--
-437,0774,337,170--
-2,878,3753,287,721281,495238,008
$-$36,694,836$30,795,325$281,495$238,008
$36,694,836$30,795,325
19,86910,766
$36,714,705$30,806,091
CITY OF ANDOVER, MINNESOTA
STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN FUND NET ASSETS
PROPRIETARY FUNDS
For The Year Ended December 31, 2003
WaterSewerStorm Sewer
Operating revenues:
User charges$1,337,130$1,287,168$117,469
Meters28,392--
Permit fees8,350--
Penalties25,92622,4161,169
Other---
Total operating revenues1,399,7981,309,584118,638
Operating expenses:
Personal services322,656164,63933,813
Supplies119,70213,2982,232
Other service charges411,349159,36841,789
Disposal charges-603,070-
Depreciation455,845415,33691,632
Total operating expenses1,309,5521,355,711169,466
Operating income (loss)90,246(46,127)(50,828)
Nonoperating revenues (expenses):
Investment income(93,195)(1,416)(320)
Interest expense(445,030)--
Total nonoperating revenues (expenses)(538,225)(1,416)(320)
Income (loss) before contributions
and transfers(447,979)(47,543)(51,148)
Capital contributions709,493454,9256,105,502
Transfers:
Transfers in505,170--
Transfers out(485,518)(843,391)-
Total transfers19,652(843,391)-
Change in net assets281,166(436,009)6,054,354
Net assets - January 114,096,27116,699,054-
Net assets - December 31$14,377,437$16,263,045$6,054,354
Net changes in net assets reported above
Amounts reported for business-type activities in the statement of activities are different because:
Transfer in of capital assets from governmental activities.
Contribution revenue reported above.
Internal service funds are used by management to charge the cost of equipment maintenance
and insurance to individual funds. This amount is the portion of net revenue attributable to
business-type activities.
Change in net assets of business-type activities
The accompanying notes are an intregral part of these financial statements.
Statement 7
Totals
Governmental Activities -
Intra
TotalsInternal Service Funds
Activity
Eliminations2003200220032002
$-$2,741,767$2,286,396$427,001$435,998
-28,39240,343--
-8,35014,000--
-49,51136,995--
--380232,85931,235
-2,828,0202,378,114659,860467,233
-521,108475,483224,583179,449
-135,23290,940143,102125,844
(20,000)592,506556,898252,906104,014
-603,070561,249--
-962,813835,030--
(20,000)2,814,7292,519,600620,591409,307
20,00013,291(141,486)39,26957,926
-(94,931)458,3114,2188,106
-(445,030)(240,557)--
-(539,961)217,7544,2188,106
20,000(526,670)76,26843,48766,032
-7,269,920373,550--
-505,170---
(20,000)(1,348,909)(754,062)--
(20,000)(843,739)(754,062)--
-5,899,511(304,244)43,48766,032
-30,795,32531,099,569238,008171,976
$-$36,694,836$30,795,325$281,495$238,008
$5,899,511$(304,244)
7,269,920373,550
(7,269,920)(373,550)
9,10310,766
$5,908,614$(293,478)
CITY OF ANDOVER, MINNESOTA
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
For The Year Ended December 31, 2003
WaterSewerStorm Sewer
Cash flows from operating activities:
Receipts from customers and users$1,356,903$1,272,374$48,009
Payment to suppliers(1,053,660)(777,152)(34,647)
Payment to employees(315,372)(165,937)(23,673)
Net cash flows from operating activities(12,129)329,285(10,311)
Cash flows from noncapital financing activities:
Receipt of advances from other funds--12,000
Payment of advances to other funds(12,000)--
Transfers in505,170--
Transfers out(485,518)(843,391)-
Net cash flows from noncapital financing activities7,652(843,391)12,000
Cash flows from capital and related financing activities:
Acquisition of capital assets(3,838,184)(3,520)-
Interest paid on debt(505,169)--
Receipt of bonds---
Net cash flows from capital and related financing activities(4,343,353)(3,520)-
Cash flows from investing activities:
Investment income(78,235)610(320)
Net increase in cash and cash equivalents(4,426,065)(517,016)1,369
Cash and cash equivalents - January 16,154,2731,398,983-
Cash and cash equivalents - December 31$1,728,208$881,967$1,369
Reconciliation of operating income to net cash provided
(used) by operating activities:
Operating income (loss) $90,246$(46,127)$(50,828)
Adjustments to reconcile operating income (loss)
to net cash flows from operating activities:
Depreciation455,845415,33691,632
Changes in assets and liabilities:
Decrease (increase) in due from other governmental units-526(500)
Decrease (increase) in accounts receivable(43,096)(37,387)(70,129)
Decrease (increase) in prepaid items-(1,517)-
Decrease (increase) in special assessments201(349)-
Decrease (increase) in inventory18,791--
Increase (decrease) in accounts payable10,2551272,899
Increase (decrease) in contracts payable(555,089)(26)6,475
Increase (decrease) in deposits payable3,434--
Increase (decrease) in due to other governmental units917261338
Increase (decrease) in salaries payable6181,0602,595
Increase (decrease) in deferred revenue---
Increase (decrease) in compensated absences5,749(2,619)7,207
Total adjustments(102,375)375,41240,517
Net cash provided by operating activities$(12,129)$329,285$(10,311)
Noncash investing, capital and financing activities:
Assets contributed to the Enterprise Funds$709,493$454,925$6,105,502
The accompanying notes are an integral part of these financial statements.
Statement 8
Totals
Governmental Activities -
TotalsInternal Service Funds
2003200220032002
$2,677,286$2,313,628$659,860$467,233
(1,865,459)(1,226,463)(409,707)(284,286)
(504,982)(473,838)(224,386)(180,300)
306,845613,32725,7672,647
12,00011,591--
(12,000)(9,815)--
505,170---
(1,328,909)(754,062)--
(823,739)(752,286)--
(3,841,704)(5,105,708)--
(505,169)---
-9,780,000--
(4,346,873)4,674,292--
(77,945)452,5654,1037,765
(4,941,712)4,987,89829,87010,412
7,553,2562,565,358168,757158,345
$2,611,544$7,553,256$198,627$168,757
$(6,709)$(141,486)$39,269$57,926
962,813835,030--
26275--
(150,612)(60,859)--
(1,517)(6,086)(8,729)(35,851)
(148)10,602--
18,791(342)(4,148)(16,451)
13,281(15,971)(963)(2,984)
(548,640)26--
3,434500--
1,5164,497141858
4,273829197571
-(14,504)--
10,337816-(1,422)
313,554754,813(13,502)(55,279)
$306,845$613,327$25,767$2,647
$7,269,920$373,550$-$-
CITY OF ANDOVER, MINNESOTA
STATEMENT OF FIDUCIARY NET ASSETSStatement 9
FIDUCIARY FUNDS
Agency Funds
December 31, 2003
20032002
Assets
Cash and investments$435,696$329,347
Liabilities
Accounts payable489-
Contracts payable3,6202,248
Deposits payable431,587327,099
Total liabilities$435,696$329,347
The accompanying notes are an integral part of these financial statements.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Note 1SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of Andover was incorporated in 1974 and operates under the State of Minnesota Statutory Plan A form of government. The
governing body consists of a five-member City council elected by voters of the City.
The financial statements of the City of Andover have been prepared in conformity with generally accepted accounting principles as
applied to governmental units by the Governmental Accounting Standards Board (GASB). The following is a summary of the significant
accounting policies.
A.FINANCIAL REPORTING ENTITY
As required by generally accepted accounting principles, the financial statements of the reporting entity include those of the
City of Andover (the primary government) and its component units. The component units discussed below are included in the
City's reporting entity because of the significance of their operational or financial relationships with the City.
COMPONENT UNITS
In conformity with generally accepted accounting principles, the financial statements of the component units have been
included in the financial reporting entity as blended component units.
The Andover Economic Development Authority (EDA) is an entity legally separate from the City. However, for financial
reporting purposes, the EDA is reported as if it were part of the City's operations because the members of the City Council
serve as EDA Board Members and its purpose is to promote development within the City of Andover. The activity of the
EDA is reported in the EDA General Special Revenue Fund. Separate financial statements are not prepared for the EDA.
B.GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS
The government-wide financial statements (i.e., the statement of net assets and the statement of changes in net assets) report
information on all of the nonfiduciary activities of the primary government and its component units. For the most part, the
Governmental activities
effect of interfund activity has been removed from these statements., which normally are supported by
business-type activities
taxes and intergovernmental revenues, are reported separately from , which rely to a significant extent on
fees and charges for support.
The statement of activities demonstrates the degree to which the direct expenses of a given function or business-type activity
Direct expenses
are offset by program revenues. are those that are clearly identifiable with a specific function or business-type
Program revenues
activity. include 1) charges to customers or applicants who purchase, use, or directly benefit from goods,
services, or privileges provided by a given function or business-type activity and 2) grants and contributions that are restricted
to meeting the operational or capital requirements of a particular function or business type activity. Taxes and other items not
general revenues
included among program revenues are reported instead as .
Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the
latter are excluded from the government-wide financial statements. Major individual governmental funds and major individual
enterprise funds are reported as separate columns in the fund financial statements.
C.MEASUREMENT FOCUS, BASIS OF ACCOUNTING, AND FINANCIAL STATEMENT PRESENTATION
economic resources measurement focusaccrual basis
The government-wide financial statements are reported using the and the
of accounting
, as are the Proprietary Fund financial statements. Revenues are recorded when earned and expenses are recorded
when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year
for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
the provider have been met. The City’s only fiduciary funds are agency funds. Agency funds are custodial in nature (assets
equal liabilities) and do not involve measurement of results of operations.
current financial resources measurement focusmodified
Governmental fund financial statements are reported using the and the
accrual basis of accounting
. Revenues are recognized as soon as they are both measurable and available. Revenues are
available
considered to be when they are collectible within the current period or soon enough thereafter to pay liabilities of the
current period. For this purpose, the government considers all revenues, except reimbursement grants, to be available if they are
collected within 60 days of the end of the current fiscal period. Reimbursement grants are considered available if they are
collected within one year of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred,
as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and
claims and judgments, are recorded only when payment is due.
Property taxes, special assessments, intergovernmental revenues, charges for services and interest associated with the current
fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period.
Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual
as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is
received by the government.
The government reports the following major governmental funds:
General Fund
Theis the government’s primary operating fund. It accounts for all financial resources of the general
government, except those required to be accounted for in another fund.
Tax Increment Finance (TIF) Commercial Revitalization Debt Service Fund (DSF)
The was established to account for debt
associated with several improvement projects in 1995 and 1996. The proceeds were used to provide funds for the
financing of certain capital and administration cost of Development District No. 1 within the City, including but not
limited to the purchase of land, land cleanup, streets, sanitary sewer, water main, storm sewer, sidewalks and curb &
gutter.
Water Trunk Capital Projects Fund (CPF)
The is used to account for water access fees and trunk improvements as part of
development. It is also used to reserve monies that will be needed for capital infrastructure replacements in the future.
Trunk CPF
The Sewer is used to account for access fees and sanitary sewer improvements. It is also used to reserve
monies that will be needed for capital infrastructure replacements in the future.
Road and Bridge CPF
The accounts for all road projects and the pavement management program, which includes annual
seal coating, crack sealing and overlays for roads.
Building Fund CPF
The is used to account for miscellaneous building improvement projects for all facilities.
Permanent Improvement Revolving CPF
The serves as a long-term funding source for large capital improvement
expenditures.
The government reports the following major proprietary funds:
Water Fund
The accounts for the water service charges, which are used to finance the water system operating expenses.
Sewer Fund
The accounts for the sewer service charges, which are used to finance the sanitary sewer system operating
expenses.
Storm Sewer Fund
The accounts for the storm sewer utility charges, which are used to finance the storm sewer operating
expenses.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Additionally, the government reports the following fund types:
Internal Service Funds
are used to provide equipment maintenance and insurance to other departments of the City on a
cost reimbursement basis.
Agency Funds
The are used to account for assets held by the City in a trustee capacity or as an agent for individuals,
private organizations, and/or other governmental units. It is used to account for the collection and distribution of funds
relating to development activities and retiree insurance premiums.
Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in both
the government-wide and proprietary-fund financial statements to the extent that those standards do not conflict with or
contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following
subsequent private-sector guidance for their business-type activities and enterprise funds, subject to this same limitation. The
government has elected not to follow subsequent private-sector guidance.
As a general rule the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions
to this general rule are transactions that would be treated as revenues, expenditures or expenses if they involved external
organizations, such as buying goods and services or payments in lieu of taxes, are similarly treated when they involve other
funds of the City of Andover. Elimination of these charges would distort the direct costs and program revenues reported for
the various functions concerned.
program revenues
Amounts reported as include 1) charges to customers or applicants for goods, services, or privileges
provided, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments.
general revenues
Internally dedicated resources are reported as rather than as program revenues. Likewise, general revenues
include all taxes.
operatingnonoperating
Proprietary funds distinguish revenues and expenses from items. Operating revenues and expenses
generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal
ongoing operations. The principal operating revenues of the water and sewer enterprise funds are charges to customers for sales
and services. Operating expenses for enterprise funds include the cost of sales and services, administrative expenses, and
depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and
expenses.
When both restricted and unrestricted resources are available for an allowable use, it is the government’s policy to use restricted
resources first, and then unrestricted resources as they are needed.
D.BUDGETS
Budgets are legally adopted on a basis consistent with generally accepted accounting principles. Annual appropriated budgets
are legally adopted for the General and Special Revenue Funds. Budgeted expenditure appropriations lapse at year-end.
Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of monies are
recorded in order to reserve that portion of the appropriation, is not employed by the City because it is at present not
considered necessary to assure effective budgetary control or to facilitate effective cash management.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
E.LEGAL COMPLIANCE - BUDGETS
The City follows these procedures in establishing the budgetary data reflected in the financial statements:
1.The City Administrator submits to the City Council a proposed operating budget for the fiscal year commencing the
following January 1. The budget includes proposed expenditures and the means of financing them.
2.Public hearings are conducted to obtain taxpayer comments.
3.The budget is legally enacted through City Council action.
4.Expenditures may legally exceed budgeted appropriations at the fund level through City Council action. Also, the
City Council may authorize transfers of budgeted amounts between departments within any fund.
5.Formal budgetary integration is employed as a management control device during the year for the General Fund and
Special Revenue Funds. Budgetary control for Capital Projects Funds is accomplished through the use of project
controls.
6.The legal level of budgetary control is at the department level for the General Fund and at the fund level for the
Special Revenue Funds. Also inherent in this controlling function is the management philosophy that the existence of
a particular item or appropriation in the approved budget does not automatically mean that it will be spent. The
budget process has flexibility in that, where need has been properly demonstrated, an adjustment can be made within
the department budget by the City Administrator or between departments by the City Council.
7.The City Council made supplemental budget appropriations throughout the year. Individual amendments were not
material in relation to the original appropriations which were adjusted.
The following is a listing of Special Revenue Funds whose expenditures exceed budget appropriations:
FinalOver
BudgetActualBudget
Special Revenue Funds:
Forestry$12,387$31,736$19,349
LRRWMO37,54642,4594,913
Trail and transportation35,00049,87314,873
Construction seal coating18,67733,21814,541
The over expenditures were funded by greater than anticipated revenues and/or available fund balance.
F.CASH AND INVESTMENTS
Cash balances from all funds are combined and invested to the extent available in authorized investments. Earnings from such
investments are allocated to the individual funds on the basis of applicable cash balance participation of each fund.
The City provides temporary advances to funds that have insufficient cash balances by means of an advance from another fund
shown as interfund receivables in the advancing fund, and an interfund payable in the fund with the deficit, until adequate
resources are received. These interfund balances are eliminated on the government-wide financial statements.
Investments are stated at fair value, based upon quoted market prices. Short-term investments, such as commercial paper and
banker’s acceptances, are reported as amortized cost.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
For purposes of the Statement of Cash Flows of Proprietary Fund Types, cash equivalents are defined as short-term, highly
liquid investments that are both:
a.readily convertible to known amounts of cash, or
b.so near their maturity that they present insignificant risk of changes in value because of changes in interest rates.
The City’s policy considers cash equivalents to be those that meet the above criteria and have original maturities of three
months or less.
G.RECEIVABLES AND PAYABLES
During the course of operations, numerous transactions occur between individual funds for goods provided or services rendered.
Short-term interfund loans are classified as “interfund receivables/payables.” All short-term interfund receivables and payables
at December 31, 2003 are planned to be eliminated in 2004. Long-term interfund loans are classified as “interfund loan
receivable/payable.” Any residual balances outstanding between the governmental activities and business-type activities are
reported in the government-wide financial statements as “internal balances.”
Interfund loan receivables, as reported in the fund financial statements, are offset by a fund balance reserve account in
applicable governmental funds to indicate that they are not available for appropriation and are not expendable available financial
resources.
Property taxes and special assessments receivable have been reported net of estimated uncollectible accounts. (See Note 1 H, I
and L) Because utility bills are considered liens on property, no estimated uncollectible amounts are established. Uncollectible
amounts are not material for other receivables and have not been reported.
H.PROPERTY TAX REVENUE RECOGNITION
The City levies its property tax for the subsequent year during the month of December and it is certified to Anoka County.
December 30th is the last day the City can certify a tax levy to the County Auditor for collection the following year. Such
taxes become a lien on the following January 1. Anoka County is the collecting agency for the levy and remits the collections to
the City three times a year. Taxes not collected as of December 31 each year are shown as delinquent taxes receivable.
The County Auditor prepares the tax list for all taxable property in the City, applying the applicable tax rate to the tax
capacity of individual properties, to arrive at the actual tax for each property. The County Auditor also collects all special
assessments, except for certain prepayments paid directly to the City.
The County Auditor submits a list of taxes to be collected on each parcel of property to the County Treasurer in January of
each year. The County Treasurer collects all taxes and is required to mail copies of all personal property tax statements by
April 15, and copies of all real estate tax statements by April 15, of each year. Property owners are required to pay one-half of
their real estate taxes due by May 15 and the balance by October 15.
If taxes due May 15 are not paid on time, a penalty of 3% is assessed on homesteaded property and 7% on nonhomesteaded
property. An additional 1% penalty is added each month the taxes remain unpaid, until October 15. If the taxes due May 15
are not paid by October 15, a 2% penalty per month is added to homesteaded property and 4% per month to nonhomesteaded
property until January 1.
If the taxes are not paid by January 1, further penalties are added. Penalties and interest apply to both taxes and special
assessments. There are some exceptions to the above penalties, but they are not material.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Within 30 days after the tax settlement date, the County Treasurer is required to pay 70% of the estimated collections of taxes
and special assessments to the City Treasurer. The County Treasurer must pay the balance to the City Treasurer within 60
days after settlement, provided that after 45 days interest accrues at the rate of 8% per annum.
GOVERNMENT-WIDE FINANCIAL STATEMENTS
The City recognizes property tax revenue in the period for which the taxes were levied. Uncollectible property taxes are not
material and have not been reported.
GOVERNMENTAL FUND FINANCIAL STATEMENTS
The City recognizes property tax revenue when it becomes both measurable and available to finance expenditures of the current
period. In practice, current and delinquent taxes and State credits received by the City in July, December and January are
recognized as revenue for the current year. Taxes collected by the County by December 31 (remitted to the City the following
January) and taxes and credits not received at the year-end are classified as delinquent and due from County taxes receivable.
The portion of delinquent taxes not collected by the City in January is fully offset by deferred revenue because they are not
available to finance current expenditures.
I.SPECIAL ASSESSMENT REVENUE RECOGNITION
Special assessments are levied against benefited properties for the cost or a portion of the cost of special assessment
improvement projects in accordance with State Statutes. These assessments are collectible by the City over a term of years
usually consistent with the term of the related bond issue. Collection of annual installments (including interest) is handled by
the County Auditor in the same manner as property taxes. Property owners are allowed to (and often do) prepay future
installments without interest or prepayment penalties.
Once a special assessment roll is adopted, the amount attributed to each parcel is a lien upon that property until full payment is
made or the amount is determined to be excessive by the City Council or court action. If special assessments are allowed to go
delinquent, the property is subject to tax forfeit sale. Proceeds of sales from tax forfeit properties are allocated first to the
County’s costs of administering all tax forfeit properties. Pursuant to State Statutes, a property shall be subject to a tax forfeit
sale after three years unless it is homesteaded, agricultural or seasonal recreational land in which event the property is subject to
such sale after five years.
GOVERNMENT-WIDE FINANCIAL STATEMENTS
The City recognizes special assessment revenue in the period that the assessment roll was adopted by the City Council.
Uncollectible special assessments are not material and have not been reported.
GOVERNMENTAL FUND FINANCIAL STATEMENTS
The City recognizes revenue from special assessments when it becomes measurable and available to finance expenditures of the
current fiscal period. In practice, current and delinquent special assessments received by the City are recognized as revenue for
the current year. Special assessments that are collected by the County by December 31 (remitted to the City the following
January) and are also recognized as revenue for the current year. All remaining delinquent, deferred and special deferred
assessments receivable in governmental funding are completely offset by deferred revenues.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
J.INVENTORIES
Inventories of the Governmental Funds and the Proprietary Funds are stated at cost, which approximates market, using the
first-in, first-out (FIFO) method.
Inventories of Governmental funds are recorded as expenditures when consumed rather than when purchased.
K.PREPAID ITEMS
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both
government-wide and fund financial statements.
L.CAPITAL ASSETS
Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads, bridges, sidewalks, and similar
items), are reported in the applicable governmental or business-type activities columns in the government-wide financial
statements. Capital assets are defined by the government as assets with an initial, individual cost of more than $5,000 (amount
not rounded) and an estimated useful life in excess of one year.Such assets are recorded at historical cost or estimated historical
cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of donation.
The City has chosen the modified approach for reporting street and trail system capital assets.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not
capitalized.
Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the
construction phase of capital assets of business-type activities is included as part of the capitalized value of the assets
constructed. For the year ended December 31, 2003, no interest was capitalized in connection with construction in progress.
Property, plant and equipment of the primary government, as well as the component units, is depreciated using the straight line
method over the following estimated useful lives:
AssetsLife
Buildings and improvements10 - 30 years
Furniture and equipment5 - 10 years
Machinery and equipment5 - 10 years
Other park improvements10 - 30 years
Storm sewer50 years
Distribution and collection systems50 years
The City elected to use the modified approach as defined by GASB Statement No. 34 for infrastructure reporting of its streets
and trails. The City conducted a physical assessment of the streets and trails condition in Fall of 2002. This condition
assessment will be performed every 3 years. Each segment of City owned street or trail was assigned a physical condition
based on potential defects. A Overall Condition Index (OCI) was assigned to each segment. The index is expressed in a
continuous scale from 0 to 100, where 0 is assigned to the least acceptable physical condition and 100 is assigned to those
segments that have the characteristic of a new street or trail. The following conditions were defined:
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
RangeDescription
86 - 100Excellent
71 - 85Very good
56 - 70Good
41 - 55Fair
26 - 40Poor
11 - 25Very poor
0 - 10Failed
The City’s policy relative to maintaining the street and trail assets is to achieve an average rating of “Good” for all segments.
This acceptable rating allows minor cracking and patching of the pavement along with minor roughness that could be noticeable
to the users of the system.
M.COMPENSATED ABSENCES
City employees earn vacation and sick pay accruing each payroll period. Unused vacation can be accrued by the employees up
to a maximum of 200 hours as of the anniversary date of the individual’s employment with the City, unless a specific
authorization is granted to an employee. All vacation pay is accrued when incurred in the government-wide and proprietary
fund financial statements. A liability for these amounts is reported in governmental funds only if they have matured, for
example, as a result of employee resignations and retirements.
Employees can also accrue an unlimited amount of unused sick leave. Employees with two or more years of service are entitled
to receive severance pay equal to a percentage of unused sick pay ranging from 20-50 percent based on years of service, up to a
maximum of 400 hours. The liability for severance pay is accounted for the same as accrued vacation pay.
N.LONG-TERM OBLIGATIONS
In the government-wide financial statements and proprietary fund types in the fund financial statements, long-term debt and
other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or
proprietary fund type statement of net assets. Bond premiums and discounts, as well as issuance costs, are immaterial and are
expensed in the year of bond issuance.
In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance
costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on
debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses.
Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.
O.FUND EQUITY
In the fund financial statements, governmental funds report reservations of fund balance for amounts not appropriable for
expenditure or legally segregated for a specific future use. Designated fund balances represent tentative plans for future use of
financial resources.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
P.INTERFUND TRANSACTIONS
Interfund services provided and used are accounted for as revenues, expenditures or expenses. Transactions that constitute
reimbursements to a fund for expenditures/expenses initially made from it that are properly applicable to another fund, are
recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the fund that is
reimbursed. Interfund loans are reported as an interfund loan receivable or payable which offsets the movement of cash
between funds. All other interfund transactions are reported as transfers.
Q.RESTRICTED ASSETS
Certain assets in the water fund are restricted for future debt service payments.
R.USE OF ESTIMATES
The preparation of financial statements in accordance with generally accepted accounting principles (GAAP) requires
management to make estimates that affect amounts reported in the financial statements during the reporting period. Actual
results could differ from such estimates.
S.RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS
1.EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND BALANCE SHEET
AND THE GOVERNMENT-WIDE STATEMENT OF NET ASSETS
fund balance – total governmental funds net
The governmental fund balance sheet includes a reconciliation between and
assets– governmental activities
as reported in the government-wide statement of net assets. One element of that
reconciliation explains that “long-term liabilities, including bonds payable, are not due and payable in the current period
and therefore are not reported in the funds.” The details of this ($29,432,352) difference are as follows:
Bonds payable$(28,625,000)
Accrued interest payable(459,818)
Compensated absences(347,534)
Net adjustment to reduce fund balance - total governmental
funds to arrive at net assets - governmental activities$(29,432,352)
Another element of that reconciliation states that “internal service funds are used by management to charge the cost of
equipment maintenance and insurance to individual funds. The assets and liabilities are included in the governmental
statement of net assets along with a deduction of net revenue attributable to business-type activities.” The details of this
$261,626 difference are as follows:
Internal Service Funds net assets$281,495
Net revenue attributable to business-type activities(19,869)
Net adjustment to increase fund balance - total governmental
funds to arrive at net assets - governmental activities$261,626
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
2.EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND STATEMENT OF
REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES AND THE GOVERNMENT-WIDE
STATEMENT OF ACTIVITIES
The governmental fund statement of revenues, expenditures, and changes in fund balances includes a reconciliation between
net changes in fund balances – total governmental fundschanges in net assets of governmental activities
and as reported in
the government-wide statement of activities. One element of that reconciliation explains that “Governmental funds report
capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their
estimated useful lives and reported as depreciation expense.” The details of this $5,300,178 difference are as follows:
Capital outlay$2,610,333
Construction/acquisition costs3,513,115
Depreciation expense(823,270)
Net adjustment to increase net changes in fund balances -
total governmental funds to arrive at changes in net assets
of governmental activities$5,300,178
Another element of that reconciliation states that “The net effect of various miscellaneous transactions involving capital
assets (i.e., sales, trade-ins, and donations) is to decrease net assets.” The details of this ($240,365) difference are as
follows:
In the statement of activities, only the gain on the sale of capital
assets is reported. However, in the governmental funds, the
proceeds from the sale increase financial resources. Thus, the
change in net assets differs from the change in fund balance by
the cost of the capital assets sold.$(250,843)
Donations of capital assets increase net assets in the statement of
activities, but do not appear in the governmental funds because
they are not financial resources.10,478
Net adjustment to decrease net changes in fund balances -
total governmental funds to arrive at changes in net assets
of governmental activities$(240,365)
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Another element of that reconciliation states “Revenues on the Statement of Activities that do not provide current
financial resources are not reported as revenues in the funds.” The details of this ($1,320,562) difference are as follows:
General property taxes deferred revenue:
At December 31, 2002$(93,823)
At December 31, 2003105,044
Tax increment taxes deferred revenue:
At December 31, 2002(16,100)
At December 31, 200319,566
Special assessments deferred revenue:
At December 31, 2002(4,852,585)
At December 31, 20033,539,684
Notes receivable deferred revenue:
At December 31, 2002(37,943)
At December 31, 200315,595
Net adjustments to decrease net changes in fund balances -
total governmental funds to arrive at changes in net assets
of governmental activities$(1,320,562)
Another element of that reconciliation states “the issuance of long-term debt (e.g., bonds, leases) provides current financial
resources to governmental funds, while the repayment of the long-term debt consumes the current financial resources of
governmental funds.” Neither transaction, however, has any effect on net assets. The details of this ($780,000) difference
are as follows:
Debt issued or incurred:
Issuance of certificates of indebtedness$(794,000)
Issuance of special assessment bonds(4,580,000)
Issuance of tax increment refunding bonds(1,530,000)
Principal repayments:
General obligation revenue bonds70,000
Special assessment bonds3,070,000
Tax increment bonds2,165,000
Certificates of indebtedness694,000
State aid bonds125,000
Net adjustment to increase net changes in fund balances -
total governmental funds to arrive at changes in net assets
of governmental activities$(780,000)
Another element of that reconciliation states that “Some expenses reported in the statement of activities do not require the
use of current financial resources and therefore are not reported as expenditures in governmental funds.” The details of this
($13,152) difference are as follows:
Compensated absences$(33,321)
Accrued interest20,169
Net adjustment to increase net changes in fund balances -
total governmental funds to arrive at changes in net assets
of governmental activities$(13,152)
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Another element of that reconciliation states that “internal service funds are used by management to charge the cost of
equipment maintenance and insurance to individual funds. This amount is the portion of net revenue attributable to
governmental activities.” The details of this $34,038 difference are as follows:
Internal Service Funds change in net assets$43,487
Net revenue attributable to business-type activities(9,103)
Net adjustment to increase fund balance - total
governmental funds to arrive at net assets -
governmental activities$34,384
Note 2 DEPOSITS AND INVESTMENTS
DEPOSITS
In accordance with Minnesota Statutes, the City maintains deposits at those depository banks authorized by the City Council, all of
which are members of the Federal Reserve System.
Minnesota Statutes require that all City deposits be protected by insurance, surety bond, or collateral. The market value of
collateral pledged must equal 110% of the deposits not covered by insurance or bonds.
Minnesota Statutes require that securities pledged as collateral be held in safekeeping by the City Clerk/Treasurer or in a financial
institution other that that furnishing the collateral. Authorized collateral includes the following:
a)United States government treasury bills, treasury notes, treasury bonds;
b)Issues of United States government agencies and instrumentalities as quoted by a recognized industry quotation service
available to the government entity;
c)General obligation securities of any state or local government with taxing powers which is rated “A” or better by a national
bond rating service, or revenue obligation securities of any state or local government with taxing powers which is rated “AA” or
better by a national bond rating service;
d)Unrated general obligation securities of a local government with taxing powers may be pledged as collateral against funds
depositedby that same local government entity;
e)Irrevocable standby letters of credit issued by Federal Home Loan Banks to a municipality accompanied by written evidence
that the bank’s public debt is rated “AA” or better by Moody’s Investors Service, Inc. or Standard & Poor’s Corporation; and
f)Time deposits that are fully insured by the Federal Deposits Insurance Corporation.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Balances at December 31, 2003 are as follows:
BankCarrying
BalancesAmount
1) Insured or collateralized by securities held by the City
or its agent in the City's name.$3,084,679$2,855,712
2) Collateralized with securities held by the pledging
institution trust department in the City's name.--
3) Uncollateralized or collateralized with securities not in
the City's name.--
Totals$3,084,679$2,855,712
INVESTMENTS
Minnesota Statutes authorize the City to invest in the following:
a)Direct obligations or obligations guaranteed by the United States or its agencies, its instrumentalities or organizations created by
an act of congress, excluding mortgage-backed securities defined as high risk.
b)Shares of investment companies registered under the Federal Investment Company Act of 1940 and whose only investments
are in securities described in (a) above, general obligation tax-exempt securities, or repurchase or reverse repurchase agreements.
c)Obligations of the State of Minnesota or any of its municipalities as follows:
1)any security which is a general obligation of any state or local government with taxing powers which is rated “A” or better
by a national bond rating service;
2)any security which is a revenue obligation of any state or local government with taxing powers which is rated “AA” or
better by a national bond rating service; and
3)a general obligation of the Minnesota housing finance agency which is a moral obligation of the State of Minnesota and is
rated “A” or better by a national bond rating agency.
d)Bankers acceptance of United States banks eligible for purchase by the Federal Reserve System.
e)Commercial paper issued by United States corporations or their Canadian subsidiaries, of the highest quality, and maturing in
270 days or less.
f)Repurchase or reverse repurchase agreements with banks that are members of the Federal Reserve System with capitalization
exceeding $10,000,000; a primary reporting dealer in U.S. government securities to the Federal Reserve Bank of New York;
certain Minnesota securities broker-dealers; or, a bank qualified as a depositor.
g)General obligation temporary bonds of the same governmental entity issued under section 429.091, subdivision 7; 469.178,
subdivision 5; or 475.61, subdivision 6.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Balances at December 31, 2003:
Carrying
Custodial Credit Risk CategoryAmount
Securities Type123(at Fair Value)
Negotiable CD's$1,178,752$-$-$1,178,752
State and local government securities1,485,991--1,485,991
U.S. government and agency securities14,173,695--14,173,695
Commercial paper5,944,624--5,944,624
Totals$22,783,062$-$-22,783,062
Investments not subject to credit risk categorization:
Minnesota municipal investment pool50,141
Open end mutual funds401,249
Total investments23,234,452
Deposits - checking account and CD's2,855,712
Total deposits and investments26,090,164
Petty Cash1,000
Total cash and investments (including cash equivalents)$26,091,164
The City's investments are categorized above to give an indication of the level of custodial credit risk assumed at year-end. Category
1 includes investments that are insured or registered or for which the securities are held by the City or its agent in the City's name.
Category 2 includes uninsured and unregistered investments for which the securities are held by the counterparty's trust department
or agent in the City's name. Category 3 includes uninsured and unregistered investments for which the securities are held by the
counterparty or by its trust department or agent but not in the City's name.
Note 3RECEIVABLES
Significant receivables balances not expected to be collected within one year of December 31, 2003 are as follows:
Due FromDelinquentDelinquentSpecial
OtherPropertyTaxAssessment
GovernmentsTaxesIncrementReceivableTotal
Major Funds:
General Fund$-$36,781$-$1,858$38,639
TIF Commercial Revitalization DSF--6,652129,130135,782
Water Trunk CPF---41,49741,497
Sewer Trunk CPF---267267
Road and Bridge CPF---263,267263,267
Permanent Improvement Revolving CPF---2,482,1522,482,152
Nonmajor Funds31,4235,2365,385455,043497,087
Total$31,423$42,017$12,037$3,373,214$3,458,691
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Governmental funds report deferred revenue in connection with receivables for revenues that are not considered to be available to liquidate
liabilities of the current period. Governmental funds also defer revenue recognition in connection with resources that have been received,
but not yet earned. At the end of the current fiscal year, the various components of deferred revenue reported in the governmental funds
were as follows:
UnavailableUnearned
Delinquent property taxes receivable:
General Fund$91,953$-
Nonmajor Funds13,091-
Delinquent tax increment collections
TIF Commercial Revitalization DSF19,566-
Special assessments not yet due:
General Fund1,858-
TIF Commercial Revitalization DSF142,145-
Water Trunk CPF56,370-
Sewer Trunk CPF15,348-
Road & Bridge CPF281,297-
Permanent Improvement Revolving CPF2,491,402-
Nonmajor Funds551,284-
Notes receivable not yet due:
Nonmajor funds15,595-
Unearned miscellaneous fees:
General Fund-3,573
Unearned construction seal coating fees:
Nonmajor funds-478,095
Total$3,679,909$481,668
Note 4LOANS RECEIVABLE
As part of a development agreement entered into with a private developer in May 1989, the City received a promissory note for
$243,520. The note is to reimburse the City for the fiscal disparities contributions the City lost due to the establishment of a tax
increment financing district for the development project. The note bears an interest rate of 5.50% and calls for 180 equal monthly
payments to be made to the City through August 2004. At December 31, 2003, the remaining principal due of $15,595 is offset by
deferred revenue as it is not available to finance current activities.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Note 5CAPITAL ASSETS
In accordance with GASB Statement No. 34, the City has reported all capital assets including infrastructure in the government-wide
statement of net assets. The City elected to use the modified approach as defined by GASB Statement No. 34 for infrastructure
reporting for its streets and trails. As a result, no accumulated depreciation or depreciation expense has been recorded for this system. A
more detailed discussion of the modified approach is presented in the Required Supplementary Information section of this report. All
other capital assets including other infrastructure systems were reported using the basic approach whereby accumulated depreciation and
depreciation expense have been recorded. Adjustments due to restatement represent the changes due to an extensive inventory of all
capital assets, implementation of GASB Statement No. 34 and a policy change related to capitalization thresholds. Capital asset activity
for the year ended December 31, 2003 as previously reported was as follows:
BeginningEnding
Primary Government
BalanceAdditionsDeletionsBalance
Governmental activities:
Capital assets not being depreciated:
Land and improvements$8,013,110$453,717$(198,674)$8,268,153
Streets and trails69,740,833867,955-70,608,788
Construction in progress1,162,1373,537,401(1,045,212)3,654,326
Total capital assets not being depreciated78,916,0804,859,073(1,243,886)82,531,267
Capital assets being depreciated:
Buildings and improvements5,710,212126,556(84,393)5,752,375
Furniture and equipment59,38728,228-87,615
Machinery and equipment5,399,634199,839(509,122)5,090,351
Other park improvements2,774,922235,797(10,000)3,000,719
Storm sewers7,045,960-(7,045,960)-
Total capital assets being depreciated20,990,115590,420(7,649,475)13,931,060
Less accumulated depreciation for:
Buildings and improvements1,567,271199,506(84,393)1,682,384
Furniture and equipment55,7302,456-58,186
Machinery and equipment2,528,025428,365(234,800)2,721,590
Other park improvements863,896115,912(6,000)973,808
Storm sewers1,654,80777,031(1,731,838)-
Total accumulated depreciation6,669,729823,270(2,057,031)5,435,968
Total capital assets being depreciated - net14,320,386(232,850)(5,592,444)8,495,092
Governmental activities capital assets - net$93,236,466$4,626,223$(6,836,330)$91,026,359
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
BeginningEnding
Primary Government
BalanceAdditionsDeletionsBalance
Business-type activities:
Capital assets not being depreciated:
Land and improvements$196,387$196,400$-$392,787
Construction in progress6,094,1133,600,224(590,114)9,104,223
Total capital assets not being depreciated6,290,5003,796,624(590,114)9,497,010
Capital assets being depreciated:
Buildings and improvements4,402,174333,752-4,735,926
Furniture and equipment29,3559,280-38,635
Machinery and equipment489,477411,365-900,842
Collection and distribution31,490,9729,031,969-40,522,941
Total capital assets being depreciated36,411,9789,786,366-46,198,344
Less accumulated depreciation for:
Buildings and improvements1,990,476190,553-2,181,029
Furniture and equipment29,355464-29,819
Machinery and equipment339,126200,151-539,277
Collection and distribution7,152,5302,452,897-9,605,427
Total accumulated depreciation9,511,4872,844,065-12,355,552
Total capital assets being depreciated - net26,900,4916,942,301-33,842,792
Business-type activities capital assets - net$33,190,991$10,738,925$(590,114)$43,339,802
Depreciation expense was charged to functions/programs of the primary government as follows:
Governmental activities:
General government$199,500
Public safety157,747
Public works200,458
Sanitation, included depreciation of general infrastructure assets79,982
Parks and recreation185,583
Total depreciation expense - governmental activities$823,270
Business-type activities
Water$455,845
Sewer415,336
Storm sewer91,632
Total depreciation expense - business-type activities$962,813
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
CONSTRUCTION COMMITMENTS
At December 31, 2003, the City had construction project contracts in progress. The commitments related to the remaining contract
balances are summarized as follows:
ContractRemaining
Project #ProjectAmountCommitment
99-15Water Treatment Facility$8,047,012$28,550
02-45Constance Corners905,73942,691
03-02Woodland Creek Golf Villas319,56120,173
03-05City View Farms96,56428,341
Total$9,368,876$119,755
Note 6LONG-TERM DEBT
The City issues general obligation bonds and equipment certificates to provide funds for the acquisition and construction of major capital
facilities. The reporting entity’s long-term debt is segregated between the amounts to be repaid from governmental activities and amounts
to be repaid from business-type activities.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
IssueMaturityInterestOriginalPayable
DateDateRateIssue12/31/03
GOVERNMENTAL ACTIVITIES:
General Obligation Revenue Bonds:
1997 Public Project Revenue Bonds9/1/199712/1/20164.50-5.90%$2,350,000$2,045,000
Special Assessment Bonds:
1994C G.O. Improvement Bonds10/1/19942/1/20065.05-5.75%1,140,000340,000
1995A G.O. Improvement Bonds7/1/19952/1/20064.85-5.30%2,605,000915,000
Total special assessment bonds3,745,0001,255,000
Tax Increment Bonds:
1994B G.O. Tax Increment Refunding Bonds5/1/19945/1/20046.97-7.87%885,00075,000
1995D G.O. Tax Increment Bonds10/1/19952/1/20134.50-5.60%6,055,0004,775,000
1999 G.O. Tax Increment Bonds6/1/199912/1/20124.00-5.00%1,500,0001,260,000
2000A G.O. Tax Increment Bonds9/1/20002/1/20106.80-7.10%2,445,0002,175,000
2003B G.O. Tax Increment Refunding Bonds6/1/20038/1/20102.00-3.00%1,530,0001,530,000
Total tax increment bonds12,415,0009,815,000
Certificates of Indebtedness:
1999 G.O. Equipment Certificates6/1/19992/1/20043.70-4.00%1,050,000305,000
2001C G.O. Capital Notes6/5/20012/1/20062.90-3.80%1,210,000760,000
2003 G.O. Equipment Certificates3/11/20036/1/20041.50-1.75%394,000200,000
2003C G.O. Equipment Certificates12/18/200312/1/20061.50%400,000400,000
Total certificates of indebtedness3,054,0001,665,000
Permanent Improvement Revolving (PIR) Bonds:
2000B G.O. PIR Bonds9/1/20002/1/20074.20-4.375%3,350,0002,740,000
2001A G.O. PIR Bonds6/5/20012/1/20073.20-4.00%4,975,0004,055,000
2003A G.O. PIR Bonds6/1/20032/1/20102.00-2.60%4,580,0004,580,000
Total permanent improvement revolving bonds12,905,00011,375,000
State Aid Bonds:
2001B G.O. State Aid Street Bonds6/5/20012/1/20172.90-5.00%2,755,0002,470,000
Total - bonded indebtedness37,224,00028,625,000
Compensated absences payable-347,534
Total governmental activities indebtedness37,224,00028,972,534
BUSINESS-TYPE ACTIVITIES
General Obligation Revenue Bonds
2002 G.O. Water Revenue Bonds5/9/20022/1/20232.30-5.00%9,780,0009,780,000
Compensated absences payable-58,967
Total business-type activities indebtedness9,780,0009,838,967
Total City indebtedness$47,004,000$38,811,501
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Annual debt service requirements to maturity for general obligation bonds are as follows:
Governmental Activities
G.O. Revenue BondsSpecial Assessment BondsTax Increment Bonds
PrincipalInterestPrincipalInterestPrincipalInterest
2004$80,000$116,740$1,255,000$33,329$860,000$489,595
200590,000112,580--995,000440,195
2006100,000107,810--1,095,000390,050
2007110,000102,410--1,145,000336,240
2008120,00096,415--1,220,000278,685
2009-2013825,000363,770--4,500,000534,500
2014-2018720,00087,210----
Total$2,045,000$986,935$1,255,000$33,329$9,815,000$2,469,265
Governmental Activities
Permanent Improvement
Certificates of IndebtednessRevolving BondsState Aid Bonds
PrincipalInterestPrincipalInterestPrincipalInterest
2004$899,000$38,001$3,695,000$309,454$130,000$106,788
2005377,00018,4651,705,000192,153135,000102,081
2006389,0006,9211,765,000139,970140,00096,957
2007--1,825,00084,005150,00091,298
2008--770,00047,305155,00085,120
2009-2013--1,615,00041,123885,000317,616
2014-2018----875,00089,480
Total$1,665,000$63,387$11,375,000$814,010$2,470,000$889,340
Business-Type Activities
G.O. Revenue Bonds
PrincipalInterest
2004$310,000$429,438
2005320,000421,392
2006335,000411,720
2007345,000400,662
2008360,000388,228
2009-20132,075,0001,705,571
2014-20182,630,0001,179,003
2019-20233,405,000443,472
Total$9,780,000$5,379,486
It is not practical to determine the specific year for payment of long-term accrued compensated absences.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
CHANGE IN LONG-TERMLIABILITIES
Long-term liability activity for the year ended December 31, 2003, was as follows:
BeginningEndingDue Within
BalanceAdditionsReductionsBalanceOne Year
Governmental activities:
Bonds payable:
G.O. revenue bonds$2,115,000$-$(70,000)$2,045,000$80,000
Special assessment bonds2,795,000-(1,540,000)1,255,0001,255,000
Tax increment bonds10,450,0001,530,000(2,165,000)9,815,000860,000
Certificates of indebtedness1,565,000794,000(694,000)1,665,000899,000
Permanent improvement revolving bonds8,325,0004,580,000(1,530,000)11,375,0003,695,000
State aid bonds2,595,000-(125,000)2,470,000130,000
Total bonds payable27,845,0006,904,000(6,124,000)28,625,0006,919,000
Compensated absences314,213246,644(213,323)347,534-
Total governmental activities
long-term liabilities$28,159,213$7,150,644$(6,337,323)$28,972,534$6,919,000
Business-type activities:
Bonds payable:
G.O. revenue bonds$9,780,000$-$-$9,780,000$310,000
Compensated absences48,63047,745(37,408)58,967-
Total business-type activities
long-term liabilities$9,828,630$47,745$(37,408)$9,838,967$310,000
For the governmental activities, bonds payable can be summarized in the following categories:
G.O. revenue bonds
The were used to construct a 30,000 square foot public works building adjacent to the existing public
works facility. The bonds are payable from annual lease payments received by the EDA from the City. These bonds do
constitute debt for the purpose of computing statutory debt limits.
special assessment bonds
The are used to finance assessable improvements within the City, including but not limited to
sanitary sewer and water line connections, storm sewer, streets, sidewalks and curb & gutter. The bonds are payable primarily
from special assessments levied against properties benefited by the improvements. In addition, the bonds are general
obligations of the City for which its full faith, credit and taxing powers are pledged without limitation as to rate or amount.
tax increment bonds
The are used to finance land acquisition and other public costs to facilitate development in the City’s tax
increment district. The bonds are payable from tax increment revenues generated by existing and new development with the
district. In addition, the bonds are general obligations of the City for which its full faith, credit and taxing powers are pledged
without limitation as to rate or amount.
certificates of indebtedness
The are used to finance the purchase of capital equipment. The certificates are general obligations of
the City for which it pledges its full faith, credit and taxing powers to the payment of principal and interest on the certificates.
permanent improvement revolving bonds
The are used to finance assessable improvements within the City, including but not
limited to sanitary sewer and water line connections, storm sewer, streets, sidewalks and curb & gutter. The bonds are payable
primarily from special assessments levied against properties benefited by the improvements. In addition, the bonds are general
obligations of the City for which its full faith, credit and taxing powers are pledged without limitation as to rate or amount.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
state aid bonds
The were used to finance the Municipal State Aid (MSA) eligible costs of the Andover Boulevard project. The
bonds are payable entirely from state-aid received by the City from construction and maintenance of the state aid street system.
The City has pledged an amount of money from its account in the state-aid street fund sufficient to pay the principal and
interest of the bonds. In addition, the bonds are general obligations of the City for which its full faith, credit and taxing powers
are pledged without limitation as to rate or amount.
compensated absences
For the governmental activities, are generally liquidated through the General Fund.
G.O. revenue bonds
For the business-type activities, the are being used to finance the construction of various water system
improvements within the City. The bonds are payable from net revenues of the water system and are general obligations of the City
for which its full faith, credit and taxing powers are pledged.
CURRENT REFUNDING
On June 1, 2003, the City issued the $1,530,000 General Obligation Tax Increment Refunding Bonds, Series 2003B with an average
interest rate of 2.24% to advance refund the 2004 through 2012 maturities aggregating $1,515,000 in principal amount of the City’s
$2,055,000 General Obligation Tax Increment Bonds, Series 1996 with an average interest rate of 5.12%, dated June 1, 1996. Net
proceeds of $1,515,000 were used to retire all outstanding principal of the refunded bonds on August 1, 2003.
The City refunded the tax increment bonds to reduce its total debt service payments over the nine years by $274,678 and to obtain
an economic gain (difference between the present value of the debt service payments on the old and new debt) of $201,488.
Note 7LEGAL DEBT MARGIN
The City is subject to a statutory limitation by the State of Minnesota for bonded indebtedness payable principally from property taxes.
The City of Andover's legal debt margin for 2003 and 2002 is computed as follows:
December 31,
20032002
Estimated taxable market value$1,966,284,300$1,719,429,400
Debt limit (2% of market value)39,325,68634,388,588
Amount of debt applicable to debt limit:
Total bonded debt$38,405,000$37,625,000
Less: Nonapplicable debt
G.O. water revenue bonds(9,780,000)(9,780,000)
Special assessment bonds(1,255,000)(2,795,000)
Tax increment bonds(9,815,000)(10,450,000)
Permanent improvement revolving bonds(11,375,000)(8,325,000)
State aid bonds(2,470,000)(2,595,000)
Less: Cash and investments in related
debt service funds(82,515)(112,848)
Total debt applicable to debt limit3,627,4853,567,152
Legal debt margin$35,698,201$30,821,436
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Note 8DEFINED BENEFIT PENSION PLANS - STATEWIDE
A.PLAN DESCRIPTION
All full-time and certain part-time employees of the City of Andover are covered by defined benefit plans administered by the
Public Employees Retirement Association of Minnesota (PERA). PERA administers the Public Employees Retirement Fund
(PERF) and the Public Employees Police and Fire Fund (PEPFF), which are cost-sharing, multiple-employer retirement plans.
Minnesota Statute
These plans are established and administered in accordance with , Chapters 353 and 356.
PERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated Plan members are covered by Social
Security and Basic Plan members are not. All new members must participate in the Coordinated Plan. All police officers,
firefighters and peace officers who qualify for membership by statute are covered by the PEPFF.
PERA provides retirement benefits as well as disability benefits to members, and benefits to survivors upon death of eligible
members. Benefits are established by State Statute, and vest after three years of credited service. The defined retirement
benefits are based on a member’s highest average salary for any five successive years of allowable service, age, and years of
credit at termination of service.
Two methods are used to compute benefits for PERF’s Coordinated and Basic Plan members. The retiring member receives the
higher of a step-rate benefit accrual formula (Method 1) or a level accrual formula (Method 2). Under Method 1, the annuity
accrual rate for a Basic Plan member is 2.2% of average salary for each of the first 10 years of service and 2.7% for each
remaining year. The annuity accrual rate for a Coordinated Plan member is 1.2% of average salary for each of the first 10 years
and 1.7% for each remaining year. Under Method 2, the annuity accrual rate is 2.7% of average salary for Basic Plan members
and 1.7% for Coordinated Plan members for each year of service. For PEPFF members, the annuity accrual rate is 3.0% for
each year of service. For all PEPFF and PERF members hired prior to July 1, 1989 whose annuity is calculated using Method
1, a full annuity is available when age plus years of service equal 90. Normal retirement age is 55 for PEPFF members and 65
for Basic and Coordinated members hired prior to July 1, 1989. Normal retirement age is the age for unreduced Social Security
benefits capped at 66 for Coordinated members hired on or after July 1, 1989. A reduced retirement annuity is also available to
eligible members seeking early retirement.
There are different types of annuities available to members upon retirement. A single-life annuity is a lifetime annuity that
ceases upon the death of the retiree – no survivor annuity is payable. There are also various types of joint and survivor annuity
options available which will be payable over joint lives. Members may also leave their contributions in the fund upon
termination of public service in order to qualify for a deferred annuity at retirement age. Refunds of contributions are available
at any time to members who leave public service, but before retirement benefits begin.
The benefit provisions stated in the previous paragraphs of this section are current provisions and apply to active plan
participants. Vested, terminated employees who are entitled to benefits but are not receiving them yet are bound by the
provisions in effect at the time they last terminated their public service.
PERA issues a publicly available financial report that includes financial statements and required supplementary information for
PERF and PEPFF. That report may be obtained on the web at mnpera.com, by writing to PERA, 60 Empire Drive #200, St.
Paul, Minnesota, 55103-1855 or by calling (651) 296-7460 or 1-800-652-9026.
B.FUNDING POLICY
Minnesota Statutes
Chapter 353 sets the rates for employer and employee contributions. These statutes are established and
amended by the state legislature. The City makes annual contributions to the pension plans equal to the amount required by
state statutes. PERF Basic Plan members and Coordinated Plan members are required to contribute 9.10% and 5.10%,
respectively, of their annual covered salary. PEPFF members are required to contribute 6.20% of their annual covered salary.
The City of Andover is required to contribute the following percentages of annual covered payroll: 11.78% for Basic Plan
PERF members, 5.53% for Coordinated Plan PERF members, and 9.30% for PEPFF members. The City’s contributions to the
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Public Employees Retirement Fund for the years ending December 31, 2003, 2002 and 2001 were $148,660, $144,981 and
$127,471, respectively. The City’s contributions to the Public Employees Police and Fire Fund for the years ending December
31, 2003, 2002 and 2001 were $10,137, $6,381 and $5,866, respectively. The City’s contributions were equal to the
contractually required contributions for each year as set by state statute.
C.DEFINED CONTRIBUTION LUMP SUM SERVICE PENSION PLAN – VOLUNTEER FIREFIGHTERS RELIEF
ASSOCIATION
PLAN DESCRIPTION
Members of the City’s volunteer fire department are members of the Andover Firefighters’ Relief Association. The
Association is the administrator of a single-employer defined contribution plan available to firefighters that was established
Minnesota Statutes
October 9, 1979 and operates under the provisions of Section 424A. It is governed by a board of six
members elected by the members of the Association for three-year terms. The City’s Mayor, City Clerk and Fire Chief are ex-
officio members of the Board of Trustees.
The Association provides retirement benefits as well as disability benefits to members, and benefits to survivors upon death of
eligible members.
1.Twenty-Year Service Pension – In order to be entitled to a pension benefit, a firefighter must have completed a
minimum of five years of service with the Department and five years membership in the Association and attain the
age of 50 years. The firefighter will then be 40% vested. This percentage increases 4% per year until the twentieth
year when 100% vesting will occur. Because this is a defined contribution plan, the amount of the retirement benefit
is not predetermined, but rather is based on the individual member’s allocable portion of contributions made during
the participation period.
2.Deferred Pension – If the retired or terminated member has not attained age 50 years and is otherwise eligible for the
pension benefit, the balance of the member’s account will be credited with earned interest at the rate permitted by
Minnesota Statutes
Section 424.A02, Subd.7.
3.Disability Benefit – If a member of the Association becomes totally and permanently disabled due to injury,
disability, sickness or dismemberment as a result of performance of duty, a disability payment will be made after one
hundred days of disability.
4.Death Benefit – In the event of death of an active member or deferred pensioner, the member’s individual account
balance will be paid to the surviving spouse, surviving children or the estate of the member after approval by the
Board.
The Association issues a publicly available financial report that includes financial statements and required supplementary
information. That report may be obtained by writing to Andover Firefighters’ Relief Association, 13875 Crosstown Boulevard,
Andover, Minnesota 55304.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
FUNDING POLICY
The State of Minnesota contributes amortization aid, or two percent fire aid, in accordance with state statute requirements.
Plan members are not required to contribute to the plan. The state legislature may amend contribution requirements of the City
and State. The City is allowed to make voluntary contributions of other public funds pursuant to Minnesota Statutes Chapter
69. Contributions for the last three years are as follows:
Year
EndingCityStateTotal
12/31/2001$41,650$84,983$126,633
12/31/200243,75098,400142,150
12/31/200342,500122,867165,367
Note 9INTERFUND RECEIVABLES/PAYABLES, LOANS AND TRANSFERS
Individual fund interfund receivable and payable balances at December 31, 2003 are as follows:
FundReceivablePayable
Governmental Funds:
Major Funds:
Water Trunk CPF$120,000$-
Road and Bridge CPF635,000-
Nonmajor Governmental Funds20,000775,000
Total governmental funds775,000775,000
Proprietary Funds:
Water12,000-
Storm Sewer-12,000
Total proprietary funds12,00012,000
Total$787,000$787,000
Interfund loan receivable and payable balances at December 31, 2003 are as follows:
Interfund Loan
FundReceivablePayable
Governmental Funds:
Major Funds:
Permanent Improvement Revolving CPF$150,000$-
Nonmajor Governmental Funds-150,000
Total governmental funds$150,000$150,000
$120,000 of the above balances are not expected to be eliminated within one year of December 31, 2003.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Interfund transfers:
Transfer InTransfer Out
Governmental Funds:
Major Funds:
General Fund$165,000$190,310
TIF Commercial Revitalization DSF1,624,440-
Water Trunk CPF350,0001,393,405
Sewer Trunk CPF390,000127,957
Building Fund CPF846,208-
Permanent Improvement Revolving CPF333,7521,873,608
Nonmajor Funds3,739,2723,039,653
Total Governmental Funds7,448,6726,624,933
Proprietary Funds:
Water505,170485,518
Sewer-843,391
Total Proprietary Funds505,1701,328,909
Total$7,953,842$7,953,842
Interfund transfers allow the City to allocate financial resources to the funds that receive benefit from services provided by another fund.
Most of the City’s interfund transfers fall under that category. Non-routine transfers include a one-time transfer of $846,208 from the
Tax Increment Projects CPF to the Building Fund CPF to reclassify interest earnings prior to July 1, 1997, which is not classified as
increment revenue.
Additionally, computer service fees paid by the Water and Sewer Funds to the General Fund have been reclassified as transfers on the
Government-Wide Statement of Activities as follows:
Transfer InTransfer Out
Governmental Activities$20,000$-
Business-Type Activities-20,000
Total$20,000$20,000
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Note 10TAX INCREMENT DISTRICTS
The City of Andover is the administering authority for the following tax increment finance districts:
1.Name of District:Andover Redevelopment District 1-1
Type of District:Redevelopment
Authorizing Law:M.S. Section 472
Established:1986
Duration of District:Through 2012
Original net tax capacity:$14,775
Current net tax capacity:206,702
Captured net tax capacity - retained by the City$191,927
2.Name of District:Andover Redevelopment District 1-2
Type of District:Redevelopment
Authorizing Law:M.S. Section 472
Established:1986
Duration of District:Through 2012
Original net tax capacity:$67,049
Current net tax capacity:871,018
Captured net tax capacity - retained by the City$803,969
Total District Bonds issued$14,990,000
Amount redeemed(5,175,000)
Bonds outstanding December 31, 2002$9,815,000
3.Name of District:Tax Increment Financing District 1-3
(Farmstead Project)
Type of District:Redevelopment
Authorizing Law:M.S. Section 469
Established:1997
Duration of District:Through 2024
Original net tax capacity:$8,458
Current net tax capacity:150,544
Captured net tax capacity - retained by the City$142,086
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Note 11DEFICIT FUND BALANCES/RETAINED EARNINGS
The City has deficit fund balances/retained earnings at December 31, 2003 as follows:
FundAmount
Special Revenue Funds:
LRRWMO$1,838
Debt Service Funds:
G.O. Equipment Certificate 20039,706
Capital Projects Funds:
Building Fund251,537
Unfinanced645,266
Storm Sewer Project111,301
Note 12CONTINGENCIES
A.RISK MANAGEMENT
The City is exposed to various risks of loss related to torts, theft of, damage to and destruction of assets; errors and omissions;
injuries to employees; and natural disasters. 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.
Workers compensation coverage is provided through a pooled self-insurance program through the LMCIT. The City pays an
annual premium to LMCIT. The City is subject to supplemental assessments if deemed necessary by the LMCIT. The
LMCIT reinsures through Workers Compensation Reinsurance Association (WCRA) as required by law. For workers
compensation, the City enrolls with a state-certified managed care organization to receive a 5% premium credit towards the cost
of coverage. The City also has a $500 deductible per occurrence to further decrease the cost of coverage. Final premiums are
determined after an audit of payroll subsequent to the close of the agreement year and are subject to revisions in rates, payrolls
and experience modification. The amount of premium adjustment, if any, is considered immaterial and not recorded until
received or paid.
Property, casualty, and automobile insurance coverage are provided through a pooled self-insurance program through the
LMCIT. The City pays an annual premium to the LMCIT. The LMCIT reinsures through commercial companies for claims
in excess of various amounts. The City retains risk for the deductible portions. These deductibles are considered immaterial to
the financial statements.
The City continues to carry commercial insurance for all other risks of loss, including employee health and disability insurance.
There were no significant reductions in insurance from the previous year or settlements in excess of insurance coverage for any
of the past three fiscal years.
B.LITIGATION
The City attorney has indicated that existing and pending lawsuits, claims and other actions in which the City is a defendant are
either covered by insurance; of an immaterial amount; or, in the judgment of the City attorney, remotely recoverable by
plaintiffs, with the exception of one lawsuit related to development activities. The outcome of the lawsuit cannot be
determined at this time, an unfavorable outcome would be between $0 and $350,000.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
C.FEDERAL AND STATE FUNDS
The City receives financial assistance from federal and state governmental agencies in the form of grants. The disbursement of
funds received under these programs generally requires compliance with the terms and conditions specified in the grant
agreements and are subject to audit by the grantor agencies. Any disallowed claims resulting from such audits could become a
liability of the applicable fund. However, in the opinion of management, any such disallowed claims will not have a material
effect on any of the financial statements of the individual fund types included herein or on the overall financial position of the
City at December 31, 2003.
D.TAX INCREMENT DISTRICTS
The City’s tax increment districts are subject to review by the State of Minnesota Office of the State Auditor (OSA). Any
disallowed claims or misuse of tax increments could become a liability of the applicable fund. Management has indicated that
they are not aware of any instances of noncompliance that would have a material effect on the financial statements.
Note 13DEFERRED AD VALOREM TAX LEVIES - BONDED DEBT
General Obligation bond issues sold by the City are financed by ad valorem tax levies and special assessment bond issues sold by the
City are partially financed by ad valorem tax levies in addition to special assessments levied against the benefiting properties. When a
bond issue to be financed partially or completely by ad valorem tax levies is sold, specific annual amounts of such tax levies are stated in
the bond resolution and the County Auditor is notified and instructed to levy these taxes over the appropriate years. The future tax
levies are subject to cancellation when and if the City has provided alternative sources of financing. The City Council is required to levy
any additional taxes found necessary for full payment of principal and interest.
These future scheduled tax levies are not shown as assets in the accompanying financial statements at December 31, 2003. Future
scheduled tax levies for all bonds outstanding at December 31, 2003 totaled $17,091,629.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Note 14DESIGNATIONS AND RESERVATIONS OF FUND EQUITY
Fund equities are classified as follows to reflect limitations and restrictions of the respective funds:
20032002
Governmental Funds:
Major Funds:
General Fund
Reserved for prepaid items$3,239$4,152
Reserved for inventory84,52768,175
Designated for working cash flow2,505,2612,742,645
TIF Commercial Revitalization DSF
Reserved for debt service491,744477,476
Water Trunk CPF
Designated for projects1,817,6971,308,035
Sewer Trunk CPF
Designated for projects741,73911,658
Road & Bridge CPF
Designated for projects2,724,0331,934,012
Building Fund CPF
Designated for projects-14,683
Permanent Improvement Revolving CPF
Reserved for interfund loan150,000-
Designated for projects7,031,8515,865,331
Nonmajor Funds
Reserved for debt service1,075,6211,187,975
Reserved for projects459,339899,238
Designated for working cash flow74,27863,412
Designated for projects2,784,6282,785,682
Designated for equipment731,806667,108
Total Governmental Funds20,675,76318,029,582
Proprietary Funds:
Water
Reserved for projects437,0774,337,170
Total$21,112,840$22,366,752
Note 15POST EMPLOYMENT BENEFITS
The City provides the ability for employees to maintain insurance coverage with the City after retirement. The retired employee is
responsible for 100% of the cost. The employee has the option of taking of payout of sick leave or have the monies deposited in a
separate medical premium account to be used towards insurance premiums.
CITY OF ANDOVER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
Note 16CONDUIT DEBT OBLIGATION
Conduit debt obligations are certain limited-obligation revenue bonds or similar debt instruments issued for the express purpose of
providing capital financing for a specific third party. The City has issued various revenue bonds to provide funding to private-sector
entities for projects deemed to be in the public interest. Although these bonds bear the name of the City, the City has no obligation for
such debt beyond the resources provided by related leases or loans. Accordingly, the bonds are not reported as liabilities in the financial
statements of the City.
As of December 31, 2003, the following revenue bonds were outstanding:
Date ofOriginalOutstanding
ProjectIssueIssueRetired12/31/2003
Downtown Center7/15/1997$5,645,000$(1,860,000)$3,785,000
Downtown Center7/15/19971,250,000(585,000)665,000
Presbyterian Homes of Andover, Inc.12/1/199813,980,000(13,980,000)-
Presbyterian Homes of Andover, Inc.12/1/1998720,000(144,000)576,000
Presbyterian Homes of Andover, Inc.11/1/200313,145,000(15,718)13,129,282
Total$34,740,000$(16,584,718)$18,155,282
Note 17SUBSEQUENT EVENTS
The City of Andover sold $3,890,000 of General Obligation Capital Improvement Bonds, Series 2004A on March 16, 2004 to finance the
construction of a new fire station and the refinancing of the existing public works facility. The rate of the bonds per year ranged from
2.00%- 3.75% with a true interest cost of 3.32%. Principal payments are due in 2005 - 2017.
The City of Andover also sold $4,260,000 of General Obligation Tax Increment Refunding Bonds, Series 2004B on March 16, 2004 to
provide moneys for the crossover refunding of the City’s $6,055,000 General Obligation Tax Increment Bonds, Series 1995D dated
October 1, 1995. The rate of the bonds per year ranged from 2.00% - 3.25% with a true interest cost of 2.78%. Principal payments are
due in 2006 – 2013.
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REQUIRED SUPPLEMENTARY INFORMATION
CITY OF ANDOVER, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATIONStatement 10
BUDGETARY COMPARISON SCHEDULE - GENERAL FUND
For The Year Ended December 31, 2003
With Comparative Actual Amounts For The Year Ended December 31, 2002
Variance with
Final Budget -
Budgeted Amounts
Positive2002
OriginalFinalActual(Negative)Actual
Revenues:
General property taxes$4,585,830$4,259,374$4,286,838$27,464$3,782,334
Licenses and permits661,825661,825551,385(110,440)588,965
Intergovernmental537,719455,744508,05452,3101,043,272
Charges for services724,705724,705647,813(76,892)689,427
Fines83,00083,00068,686(14,314)73,475
Investment income100,000100,000(6,407)(106,407)109,524
Miscellaneous219,136219,136226,8687,732208,790
Total revenues6,912,2156,503,7846,283,237(220,547)6,495,787
Expenditures:
Current:
General government:
Mayor and City council92,81892,81891,88393567,692
Newsletter40,70030,70021,6749,02625,634
City clerk134,003133,238129,1954,043125,558
Administration132,711128,524127,725799121,539
Human resources114,33153,04949,4903,55987,756
Financial administration284,787253,402246,5266,876273,152
Elections11,81511,81511,43038538,712
Assessing110,000108,000106,9331,067100,979
Legal137,196137,196146,365(9,169)142,411
Planning and zoning310,115285,167262,46122,706242,373
Information systems150,108141,953131,09610,857128,759
Facility management325,452305,452267,05738,395305,024
Engineering375,320354,502323,47931,023385,203
Total general government2,219,3562,035,8161,915,314120,5022,044,792
Public safety:
Police1,421,3121,421,3121,421,312-1,234,866
Fire protection772,759808,856769,14339,713705,320
Protective inspection441,199436,514426,21910,295394,041
Civil defense14,02114,0216,6557,3669,606
Animal control8,9308,9308,6622689,076
Total public safety2,658,2212,689,6332,631,99157,6422,352,909
Public works:
Streets and highways377,915337,805313,69124,114392,652
Snow and ice removal551,144551,144483,28867,856521,700
Street lighting159,550159,550174,704(15,154)165,062
Street signs133,241132,486115,20517,281118,265
Traffic signals15,00015,00021,690(6,690)14,464
Total public works1,236,8501,195,9851,108,57887,4071,212,143
Sanitation:
Storm sewers121,81460,90750,44310,46463,733
Tree preservation and weed control44,31844,31830,45813,86043,928
Total sanitation$166,132$105,225$80,901$24,324$107,661
(Continued)
CITY OF ANDOVER, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATIONStatement 10
BUDGETARY COMPARISON SCHEDULE - GENERAL FUND(Continued)
For The Year Ended December 31, 2003
With Comparative Actual Amounts For The Year Ended December 31, 2002
Variance with
Final Budget -
Budgeted Amounts
Positive2002
OriginalFinalActual(Negative)Actual
Expenditures:
Current: (continued)
Parks and recreation$636,186$572,265$574,719$(2,454)$643,712
Recycling120,391116,426114,7841,642116,005
Unallocated87,55633,41825,8657,55330,614
Total current7,124,6926,748,7686,452,152296,6166,507,836
Capital outlay
General government----58,943
Public works--17,714(17,714)-
Parks and recreation40,00030,00024,2855,71518,738
Total capital oulay40,00030,00041,999(11,999)77,681
Total expenditures7,164,6926,778,7686,494,151284,6176,585,517
Revenues over (under) expenditures(252,477)(274,984)(210,914)64,070(89,730)
Other financing sources (uses):
Transfers in165,000165,000165,000-217,437
Transfers out(190,310)(190,310)(190,310)-(748,893)
Proceeds from the sale of capital assets--14,27914,27916,086
Total other financial sources (uses)(25,310)(25,310)(11,031)14,279(515,370)
Net increase in fund balance$(277,787)$(300,294)(221,945)$78,349(605,100)
Fund balance - January 12,814,9723,420,072
Fund balance - December 31$2,593,027$2,814,972
CITY OF ANDOVER, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2003
Note ALEGAL COMPLIANCE – BUDGETS
The General Fund budget is legally adopted on a basis consistent with accounting principles generally accepted in the United States of
America. The legal level of budgetary control is at the departmental level for the General Fund. The following is a listing of General
Fund departments whose expenditures exceed budget appropriations.
FinalOver
BudgetActualBudget
General Fund:
General government:
Legal$137,196$146,365$9,169
Public works:
Street lighting159,550174,70415,154
Traffic signals15,00021,6906,690
Parks and recreation572,265574,7192,454
Note BMODIFIED APPROACH FOR CITY STREETS AND TRAILS INFRASTRUCTURE CAPITAL ASSETS
In accordance with GASB Statement No. 34, the City is required to account for and report infrastructure capital assets. The City defines
infrastructure as the basic physical assets including the street and trail system; water treatment and distribution system; wastewater
collection system; park and recreation lands and improvement system; storm water conveyance system; and building combined with site
amenities such as parking and landscape areas used by the City in the conduct of its business. Each major infrastructure can be divided
into subsystems. For example, the street and trail system can be divided into pavement widths, curb type and sidewalk. City owned
streets could further be classified as collector or local. Subsystem detail is not presented in these basic financial statements; however, the
City maintains detailed information on these subsystems.
The City has elected to use the modified approach as defined in GASB Statement No. 34 for infrastructure reporting for its Pavement
Management Program. Under GASB Statement No. 34, eligible infrastructure capital assets are not required to be depreciated under the
following requirements:
1)The City manages the eligible infrastructure capital assets using an asset management system with characteristics of (a) an up
to-date inventory; (2) perform condition assessments and summarize the results using a measurement scale; and (3) estimate
annual amount to maintain and preserve at the established condition assessment level.
2)The City documents that the eligible infrastructure capital assets are being preserved approximately at or above the established
and disclosed condition assessment level.
CITY OF ANDOVER, MINNESOTA
REQUIRED SUPPLEMENTARY INFORMATION
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2003
In fall of 2002, the City conducted a physical condition assessment of the streets and trails. This assessment will be performed every
three years. Each street and trail segment was assigned a physical condition based on potential defects. An Overall Condition Index
(OCI) was assigned to each street and trail and expressed in a continuous scale from 0 to 100, where 0 is assigned to the least acceptable
physical condition and 100 is assigned the physical characteristics of a new street or trail. The following conditions were defined:
ConditionRating
Excellent86 - 100
Very Good71 - 85
Good56 - 70
Fair41 - 55
Poor26 - 40
Very Poor11 - 25
Substandard0 - 10
As of December 31, 2002, the City’s street and trail system was rated at an OCI index of 82 on the average with detail condition as
follows:
% of Street
Conditionand Trails
Excellent to Good88%
Fair7%
Poor to Substandard5%
The City’s streets and trails are constantly deteriorating resulting from the following factors: (1) traffic using the system; (2) the sun’s
ultra-violet rays drying out and breaking down the top layer of pavement; (3) utility company/private development trenching operations;
(4) water damage from natural precipitation; and (5) frost heave. The City is continuously taking actions to prolong the life of the system
through short-term maintenance activities such as pothole patching, crack sealing, seal coating and overlaying. The City expended
$956,688 on street and trail maintenance for the year ending December 31, 2003. These expenditures delayed deterioration; however, the
overall condition of the system was not improved through these maintenance expenditures. The City has estimated that the amount of
annual expenditures required to maintain the City’s street and trail system at the average OCI rating of good is approximately $950,000.
MaintenanceActualOCI
YearEstimateExpendituresRating
2002$900,000$1,590,26882
2003950,000956,68882
The City has an on-going street and trail rehabilitation program funded in the Capital Improvement Program that is intended to improve
the condition rating of the City streets and trails. The rehabilitation program is formulated based on the deficiencies identified as a part of
its Pavement Management Program.
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COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES
NONMAJOR GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS
A Special Revenue Fund is used to account for the proceeds of specific revenue sources that are legally restricted to
expenditures for specified purposes. Revenues for these funds can come from a variety of sources, such as taxes,
fees, gifts and grants or contributions from other governmental entities. Expenditures from these funds are normally
restricted by statute, local ordinance or grant agreements. The funds may be used for either operations or capital
outlay as legal restrictions mandate.
DEBT SERVICE FUNDS
A Debt Service Fund accounts for the accumulation of resources for, and the payment of general long-term principal,
interest and other related costs.
CAPITAL PROJECTS FUNDS
A Capital Projects Fund is used to account for acquisition or construction of major capital facilities financed mainly
with governmental fund resources, general obligation debt, special assessments, special assessment debt, grants or
other resources that are not part of Proprietary Funds or Trust Funds.
CITY OF ANDOVER, MINNESOTA
COMBINING BALANCE SHEETStatement 11
NONMAJOR GOVERNMENTAL FUNDS
December 31, 2003
With Comparative Totals For December 31, 2002
Totals
SpecialDebtCapitalNonmajor Governmental Funds
RevenueServiceProjects20032002
Assets
Cash and investments$1,658,599$1,009,500$3,073,257$5,741,356$5,045,747
Accrued interest 5,3283,4396,61015,37716,182
Due from other governmental units8,659-32,92341,58231,423
Accounts receivable - net47,009--47,00997,641
Interfund receivable-20,000-20,000-
Property taxes receivable:
Unremitted1,97050,41992253,3112,881
Delinquent39912,692-13,091673
Special assessments receivable:
Unremitted-2,5571,4193,9761,005
Delinquent-5,3451405,485-
Deferred-436,565109,214545,779244,872
Notes receivable--15,59515,59537,943
Total assets1,721,9641,540,5173,240,0806,502,5615,478,367
Liabilities, equity and other credits
Liabilities:
Interfund payable-20,000755,000775,000655,000
Accounts payable1,441-23,12724,5686,366
Contracts payable6,935-95,323102,258276,387
Due to other governmental units1,097-5,7346,831173,098
Salaries payable8,371--8,3716,366
Interfund loan payable--150,000150,000-
Deferred revenue478,494454,602124,9491,058,045743,615
Total liabilities496,338474,6021,154,1332,125,0731,860,832
Equity and other credits:
Fund balance (deficit):
Reserved-1,075,621459,3391,534,960899,238
Unreserved:
Designated1,207,537-2,383,1753,590,7123,516,202
Undesignated18,089(9,706)(756,567)(748,184)(797,905)
Total equity and other credits1,225,6261,065,9152,085,9474,377,4883,617,535
Total liabilities, equity and other credits$1,721,964$1,540,517$3,240,080$6,502,561$5,478,367
CITY OF ANDOVER, MINNESOTA
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND Statement 12
CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
For The Year Ended December 31, 2003
With Comparative Totals For The Year Ended December 31, 2002
Totals
Nonmajor Governmental Funds
SpecialDebtCapital
RevenueServiceProjects20032002
Revenues:
General property taxes$89,658$705,285$45,909$840,852$746,550
Tax increment collections-512,854144,594657,448453,107
Intergovernmental34,191290,113538324,842360,534
Special assessments-300,238148,381448,619399,334
Charges for services215,981--215,981181,514
Investment income51,90326,80414,61093,317257,131
Miscellaneous
Park dedication fees--357,483357,483280,312
Other115,125-23,244138,369123,455
Total revenues506,8581,835,294734,7593,076,9112,801,937
Expenditures:
Current:
General government18,051-131,002149,053107,431
Public works184,449-443,083627,532608,531
Sanitation----2,552
Parks and recreation--38,35938,35945,449
Economic development182,038-289,134471,172720,960
Capital outlay:
General government--28,22828,228-
Public safety21,276-108,549129,82527,717
Public works43,864-50,47294,336392,122
Sanitation--120,186120,18665,215
Parks and recreation--272,457272,457634,842
Debt service:
Principal retirement-4,279,000-4,279,0004,030,000
Interest-939,194-939,1941,250,079
Paying agent fees-3,124-3,1243,115
Professional service-25,015-25,0155,734
Construction/acquisition costs--183,886183,886116,925
Total expenditures449,6785,246,3331,665,3567,361,3678,010,672
Revenues over (under) expenditures57,180(3,411,039)(930,597)(4,284,456)(5,208,735)
Other financing sources (uses):
Transfers in106,5543,632,718-3,739,2722,242,962
Transfers out(40,021)(1,878,927)(1,120,705)(3,039,653)(1,204,982)
Bonds issued-1,530,000794,0002,324,000-
Bond premium-5,188-5,188-
Proceeds from sale of capital assets19,751-807,876827,6272,106,307
Total other financing sources (uses)86,2843,288,979481,1713,856,4343,144,287
Net increase (decrease) in fund balance143,464(122,060)(449,426)(428,022)(2,064,448)
Fund balance - January 11,082,1621,187,9752,535,3734,805,5106,869,958
Fund balance - December 31$1,225,626$1,065,915$2,085,947$4,377,488$4,805,510
NONMAJORSPECIAL REVENUE FUNDS
The City of Andover had the following Special Revenue Funds during the year:
Forestry- This fund was established to account for the protection of forest resources and the development of control
plans to ensure preservation or restoration of these resources.
LRRWMO- This fund is used to account for the City’s involvement with the Lower Rum River Watershed
Management Organization (LRRWMO).
Drainage and Mapping- This fund accounts for resources necessary to maintain existing maps and developing new
maps and mapping systems for the City.
EDA General- This fund was established to account for activities designed to promote quality economic
development within in the community.
Trail and Transportation- This fund is used to account for contributions associated with land development to be
used for constructing and upgrading the City’s trail system.
Right-of-Way Management/Utility- This fund is used to account for activity associated with the management of the
public right-of-ways.
Capital Equipment Reserve- This fund is used to account for the capital equipment/projects levy and the various
capital expenditures it will be used for.
Construction Seal Coating- This fund accounts for the contributions associated with land development to be used
for the respective developments first application of crack seal and seal coat.
CITY OF ANDOVER, MINNESOTA
SUBCOMBINING BALANCE SHEET
NONMAJOR SPECIAL REVENUE FUNDS
December 31, 2003
With Comparative Totals For December 31, 2002
Drainage
andEDA
ForestryLRRWMOMappingGeneral
Assets
Cash and investments$6,151$4,635$27,418$5,630
Accrued interest4415100-
Due from other governmental units8,159500--
Accounts receivable---22,504
Property taxes receivable:
Unremitted-607--
Delinquent-399--
Total assets14,3546,15627,51828,134
Liabilities and Fund Balance
Liabilities:
Interfund payable----
Accounts payable592--849
Contracts payable-6,475-460
Due to other governmental units1813016672
Salaries payable135990-5,209
Deferred revenue-399--
Total liabilities7457,994167,190
Fund balance (deficit):
Unreserved:
Designated for working capital13,609-7,57520,944
Designated for projects----
Designated for equipment----
Undesignated-(1,838)19,927-
Total fund balance (deficit)13,609(1,838)27,50220,944
Total liabilities and fund balance$14,354$6,156$27,518$28,134
Statement 13
Totals
Right-of-WayCapital
Nonmajor Special Revenue Funds
Trail andManagement/EquipmentConstruction
TransportationUtilityReserveSeal Coating20032002
$89,840$184,820$728,203$611,902$1,658,599$1,493,717
2965622,2402,0715,3284,878
----8,659-
-24,505--47,00983,326
--1,363-1,9702,359
----399673
90,136209,887731,806613,9731,721,9641,584,953
-----12,000
----1,441947
----6,93521,834
-261--1,097844
-2,037--8,3716,366
---478,095478,494460,800
-2,298-478,095496,338502,791
-32,150--74,27863,412
90,136175,439-135,878401,453353,446
--731,806-731,806667,108
----18,089(1,804)
90,136207,589731,806135,8781,225,6261,082,162
$90,136$209,887$731,806$613,973$1,721,964$1,584,953
CITY OF ANDOVER, MINNESOTA
SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
NONMAJOR SPECIAL REVENUE FUNDS
For The Year Ended December 31, 2003
With Comparative Totals For The Year Ended December 31, 2002
Drainage
andEDA
ForestryLRRWMOMappingGeneral
Revenues:
General property taxes$-$21,771$-$-
Intergovernmental27,215256--
Charges for services4,318-8,44432,863
Investment income328(576)2,048-
Miscellaneous---114,490
Total revenues31,86121,45110,492147,353
Expenditures:
Current:
General government----
Public works31,73642,45912,602-
Sanitation----
Economic development---182,038
Capital outlay:
Public safety----
Public works----
Sanitation----
Parks and recreation----
Total expenditures31,73642,45912,602182,038
Revenues over (under) expenditures125(21,008)(2,110)(34,685)
Other financing sources (uses):
Transfers in--40,05746,497
Transfers out-(5,007)--
Proceeds from sale of capital assets----
Total financing sources (uses)-(5,007)40,05746,497
Net increase (decrease) in fund balance125(26,015)37,94711,812
Fund balance (deficit) - January 113,48424,177(10,445)9,132
Fund balance (deficit) - December 31$13,609$(1,838)$27,502$20,944
Statement 14
Totals
Right-of-WayCapital
Nonmajor Special Revenue Funds
Trail andManagement/EquipmentConstruction
TransportationUtilityReserveSeal Coating20032002
$-$-$67,887$-$89,658$200,991
5,925-795-34,19133,114
79,93069,065-21,361215,981181,514
2,9977,35519,95719,79451,90348,483
--635-115,12593,278
88,85276,42089,27441,155506,858557,380
--18,051-18,051107,431
6,00958,425-33,218184,449110,521
-----271
----182,038155,684
--21,276-21,27627,717
43,864---43,864106,003
-----65,215
-----31,898
49,87358,42539,32733,218449,678604,740
38,97917,99549,9477,93757,180(47,360)
--20,000-106,55438,444
-(10,014)(25,000)-(40,021)(745,337)
--19,751-19,75144,905
-(10,014)14,751-86,284(661,988)
38,9797,98164,6987,937143,464(709,348)
51,157199,608667,108127,9411,082,1621,791,510
$90,136$207,589$731,806$135,878$1,225,626$1,082,162
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NONMAJOR DEBT SERVICE FUNDS
The City's Debt Service Funds account for six types of bonded indebtedness:
x
G.O. Revenue Bonds
x
Special Assessment Bonds
x
Tax Increment Bonds
x
Certificates of Indebtedness
x
Permanent Improvement Revolving Bonds
x
State Aid Bonds
G.O. Revenue Bonds– (EDA Public Project Revenue Bonds of 1997) are repaid from annual lease payments from the
City.
Special Assessment Bonds– (issues 1993A, 1994C, 1995A and 1997B) are used to finance assessable improvements
within the City and are repaid primarily from special assessments levied against benefited properties.
Tax Increment Bonds– (Tax Increment Bonds of 1994B, 1999, 2000A and 2003B Refunding) are repaid primarily from
tax increments.
Certificates of Indebtedness– (G.O. Equipment Certificate of 1999, 2001C Capital Notes and G.O. Equipment
Certificate of 2003) are repaid primarily from general property taxes.
Permanent Improvement Revolving (PIR) Bonds– (G.O. PIR Bonds of 2000B, 2001A and 2003A) are used to finance
assessable improvements within the City and are repaid primarily from special assessments levied against benefited
properties.
StateAid Bonds– (2001B State Aid Bonds) are used to finance MSA eligible cost for road construction and
improvements. These bonds are repaid from a portion of state aid allotments received by the City.
CITY OF ANDOVER, MINNESOTA
SUBCOMBINING BALANCE SHEET
NONMAJOR DEBT SERVICE FUNDS
December 31, 2003
With Comparative Totals For December 31, 2002
EDA Public
TIFG.O.G.O.ProjectG.O.
BondsImprovementImprovementRevenueEquipmentTIFTIF
of 1994BBonds ofBonds ofBondsCertificateBondsBonds
Project 1-21994C1995Aof 1997of 1999of 1999of 2000A
Assets
Cash and investments$80,562$37,196$177,392$22,254$9,963$127,878$195,775
Accrued interest182521,265442-531261
Interfund receivable-------
Property taxes receivable:
Unremitted4,200---5,53613,64918,338
Delinquent----4,950--
Special assessments receivable:
Unremitted-7731,784----
Delinquent-1,8373,508----
Deferred-263,977172,588----
Total assets84,944303,835356,53722,69620,449142,058214,374
Liabilities and Fund Balance
Liabilities:
Interfund payable-------
Deferred revenue-265,814176,096-4,950--
Total liabilities-265,814176,096-4,950--
Fund balance (deficit):
Reserved for debt service84,94438,021180,44122,69615,499142,058214,374
Unreserved:
Undesignated-------
Total fund balance (deficit)84,94438,021180,44122,69615,499142,058214,374
Total liabilities and fund balance$84,944$303,835$356,537$22,696$20,449$142,058$214,374
Statement 15
G.O.G.O.G.O.G.O.G.O. TIF
PIR FundCapitalPIR FundStateEquipmentPIR FundRefundingTotals
Nonmajor Debt Service Funds
Bonds ofNotesBonds ofAid BondsCertificateBonds ofBonds
2000B2001C2001A2001B20032003A2003B20032002
$9,798$50,298$31,734$202,284$6,360$47,610$10,396$1,009,500$1,171,329
31-103133268155163,4393,787
-20,000-----20,000-
-5,030--3,666--50,4199,789
-4,442--3,300--12,69210,338
-------2,5573,071
-------5,3456,193
-------436,565700,857
9,82979,77031,837202,41713,59447,76510,4121,540,5171,905,364
----20,000--20,000-
-4,442--3,300--454,602717,389
-4,442--23,300--474,602717,389
9,82975,32831,837202,417-47,76510,4121,075,6211,187,975
----(9,706)--(9,706)-
9,82975,32831,837202,417(9,706)47,76510,4121,065,9151,187,975
$9,829$79,770$31,837$202,417$13,594$47,765$10,412$1,540,517$1,905,364
CITY OF ANDOVER, MINNESOTA
SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
NONMAJOR DEBT SERVICE FUNDS
For The Year Ended December 31, 2003
With Comparative Totals For The Year Ended December 31, 2002
EDA Public
TIFG.O.G.O.G.O.ProjectG.O.G.O.
BondsImprovementImprovementImprovementRevenueImprovementEquipmentTIF
of 1994BBonds ofBonds ofBonds ofBondsBonds ofCertificateBonds
Project 1-21993A1994C1995Aof 19971997Bof 1999of 1999
Revenues:
General property taxes$-$-$-$-$-$-$274,356$-
Tax increment collections59,519------193,436
Intergovernmental4,978-----3,18516,179
Special assessments-100,26652,905145,856-1,211--
Investment income(1,451)3,052(3,128)17,5497,6715,223(7,208)8,709
Total revenues63,046103,31849,777163,4057,6716,434270,333218,324
Expenditures:
Debt service:
Principal retirement90,000365,000120,000280,00070,000775,000270,000110,000
Interest9,43517,33822,30254,665120,31034,87517,60059,475
Paying agent fees-480496446----
Professional services-5127204,064----
Total expenditures99,435383,330143,518339,175190,310809,875287,600169,475
Revenues over (under) expenditures(36,389)(280,012)(93,741)(175,770)(182,639)(803,441)(17,267)48,849
Other financing sources (uses):
Transfers in13,680308,69244,700302,700190,310774,148-45,600
Transfers out-(42,027)-(321,900)----
Bonds issued--------
Bond premium--------
Total other financing sources (uses)13,680266,66544,700(19,200)190,310774,148-45,600
Net increase (decrease) in fund balance(22,709)(13,347)(49,041)(194,970)7,671(29,293)(17,267)94,449
Fund balance - January 1107,65313,34787,062375,41115,02529,29332,76647,609
Fund balance - December 31$84,944$-$38,021$180,441$22,696$-$15,499$142,058
Statement 16
G.O.G.O.G.O.G.O.G.O. TIF
Totals
TIFPIR FundCapitalPIR FundStateEquipmentPIR FundRefunding
Nonmajor Debt Service Funds
BondsBonds ofNotesBonds ofAid BondsCertificateBonds ofBonds
of 2000A2000B2001C2001A2001B20032003A2003B20032002
$-$-$249,248$-$-$181,681$-$-$705,285$501,108
259,899-------512,854307,095
21,738-2,895-239,0302,108--290,113322,346
--------300,238322,783
(1,233)(2,768)(6,448)(3,787)(6,418)4,4362,6629,94326,80459,734
280,404(2,768)245,695(3,787)232,612188,2252,6629,9431,835,2941,513,066
120,000610,000230,000920,000125,000194,000--4,279,0004,030,000
159,700131,06231,338166,133111,0303,931--939,1941,250,079
288288378374374---3,1243,115
-------19,71925,0155,734
279,988741,350261,7161,086,507236,404197,931-19,7195,246,3335,288,928
416(744,118)(16,021)(1,090,294)(3,792)(9,706)2,662(9,776)(3,411,039)(3,775,862)
59,280742,02220,0001,086,483--45,103-3,632,7181,769,097
-------(1,515,000)(1,878,927)(176,130)
-------1,530,0001,530,000-
-------5,1885,188-
59,280742,02220,0001,086,483--45,10320,1883,288,9791,592,967
59,696(2,096)3,979(3,811)(3,792)(9,706)47,76510,412(122,060)(2,182,895)
154,67811,92571,34935,648206,209---1,187,9753,370,870
$214,374$9,829$75,328$31,837$202,417$(9,706)$47,765$10,412$1,065,915$1,187,975
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NONMAJORCAPITAL PROJECT FUNDS
The City of Andover had the following Capital Projects Funds during the year:
Storm Sewer Project- This fund was established to account for storm sewer fees and improvements as part of
development and ongoing maintenance.
Unfinanced- This fund was established to account for projects that have been internally financed by the City where
it is not practical to issue bonds to finance.
Tax Increment Projects– This fund was established to account for activities in TIF districts 1-1, 1-2 and all TIF land
sales and expenditures to reach the goals of the TIF district plans.
Park Dedication- This fund was established to account for contributions associated with land development to be
used for constructing and upgrading the City’s park system.
Capital Notes 2003- This fund was established to account for the purchase of capital equipment that was financed
through the issuance of capital notes. This fund was closed in 2003.
Capital Notes 2003C- This fund was established to account for the purchase of capital equipment that was financed
through the issuance of capital notes.
State Aid Bonds 2001B- This fund was established to account for the construction and maintenance of various MSA
eligible projects.
CITY OF ANDOVER, MINNESOTA
SUBCOMBINING BALANCE SHEET
NONMAJOR CAPITAL PROJECTS FUNDS
December 31, 2003
Comparative Totals For December 31, 2002
StormTax
SewerIncrement
ProjectUnfinancedProjects
Assets
Cash and investments$8,699$5,427$1,616,817
Accrued interest--3,330
Due from other governmental units--31,423
Accounts receivable---
Property taxes receivable:
Unremitted---
Special assessments receivable:
Unremitted-1,419-
Delinquent-140-
Deferred-103,1016,113
Notes receivable--15,595
Total assets8,699110,0871,673,278
Liabilities and Fund Balance
Liabilities:
Interfund payables120,000635,000-
Accounts payable--2
Contracts payable-17,1124,657
Due to other governmental units--5,734
Interfund loan payable---
Deferred revenue-103,24121,708
Total liabilities120,000755,35332,101
Fund balance (deficit):
Reserved for projects---
Unreserved:
Designated for projects--1,641,177
Undesignated(111,301)(645,266)-
Total fund balance (deficit)(111,301)(645,266)1,641,177
Total liabilities and fund balance$8,699$110,087$1,673,278
Statement 17
Totals
CapitalState
Nonmajor Capital Projects Funds
ParkNotesAid Bonds
Dedication2003C2001B20032002
$509,058$402,399$530,857$3,073,257$3,552,030
1,0721722,0366,61011,304
1,500--32,92331,423
----14,315
922--922522
---1,4191,005
---140-
---109,214244,872
---15,59537,943
512,552402,571532,8933,240,0803,893,414
---755,000643,000
21,0792,046-23,1275,419
--73,55495,323254,553
---5,734172,254
150,000--150,000-
---124,949282,815
171,0792,04673,5541,154,1331,358,041
--459,339459,339899,238
341,473400,525-2,383,1752,432,236
---(756,567)(796,101)
341,473400,525459,3392,085,9472,535,373
$512,552$402,571$532,893$3,240,080$3,893,414
CITY OF ANDOVER, MINNESOTA
SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
NONMAJOR CAPITAL PROJECTS FUNDS
For The Year Ended December 31, 2003
With Comparative Totals For The Year Ended December 31, 2002
StormTax
SewerIncrement
ProjectUnfinancedProjects
Revenues:
General property taxes$-$-$-
Tax increment collections--144,594
Intergovernmental---
Special assessments-147,3031,078
Investment income-(16,911)6,957
Miscellaneous
Park dedication fees---
Other--22,354
Total revenues-130,392174,983
Expenditures:
Current:
General government---
Public works-21,326-
Sanitation---
Parks and recreation---
Economic development--289,134
Capital outlay:
General government---
Public safety---
Public works---
Sanitation---
Parks and recreation---
Construction/acquisition costs-69,53223,181
Total expenditures-90,858312,315
Revenues over (under) expenditures-39,534(137,332)
Other financing sources (uses):
Transfers in ---
Transfers out--(1,120,705)
Bonds issued---
Proceeds from sale of capital assets--777,140
Total other financing sources (uses)--(343,565)
Net increase (decrease) in fund balance-39,534(480,897)
Fund balance - January 1(111,301)(684,800)2,122,074
Fund balance - December 31$(111,301)$(645,266)$1,641,177
Statement 18
Totals
CapitalCapitalState
Nonmajor Capital Projects Funds
ParkNotesNotesAid Bonds
Dedication20032003C2001B20032002
$45,909$-$-$-$45,909$44,451
----144,594146,012
538---5385,074
----148,38176,551
9,8271,8472,57010,32014,610148,914
357,483---357,483280,312
890---23,24430,177
414,6471,8472,57010,320734,759731,491
-128,9572,045-131,002-
---421,757443,083498,010
-----2,281
38,359---38,35945,449
----289,134565,276
-28,228--28,228-
-108,549--108,549-
-25,051-25,42150,472286,119
-117,145-3,041120,186-
253,80418,653--272,457602,944
91,173---183,886116,925
383,336426,5832,045450,2191,665,3562,117,004
31,311(424,736)525(439,899)(930,597)(1,385,513)
-----435,421
----(1,120,705)(283,515)
-394,000400,000-794,000-
-30,736--807,8762,061,402
-424,736400,000-481,1712,213,308
31,311-400,525(439,899)(449,426)827,795
310,162--899,2382,535,3731,707,578
$341,473$-$400,525$459,339$2,085,947$2,535,373
CITY OF ANDOVER, MINNESOTA
SPECIAL REVENUE FUND - FORESTRYStatement 19
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
For The Year Ended December 31, 2003
With Comparative Actual Amounts For The Year Ended December 31, 2002
Variance with
Final Budget -
Budgeted Amounts
Positive2002
OriginalFinalActual(Negative)Actual
Revenues:
Intergovernmental$-$-$27,215$27,215$-
Charges for services10,00010,0004,318(5,682)6,742
Investment income400400328(72)200
Total revenues10,40010,40031,86121,4616,942
Expenditures:
Current:
Public works12,38712,38731,736(19,349)17,577
Revenues over (under) expenditures(1,987)(1,987)1252,112(10,635)
Other financing sources (uses):
Transfers out----(5,631)
Net increase (decrease) in fund balance$(1,987)$(1,987)125$2,112(16,266)
Fund balance (deficit) - January 113,48429,750
Fund balance (deficit) - December 31$13,609$13,484
CITY OF ANDOVER, MINNESOTA
SPECIAL REVENUE FUND - LRRWMOStatement 20
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
For The Year Ended December 31, 2003
With Comparative Actual Amounts For The Year Ended December 31, 2002
Variance with
Final Budget -
Budgeted Amounts
Positive2002
OriginalFinalActual(Negative)Actual
Revenues:
General property taxes$24,000$24,000$21,771$(2,229)$23,186
Intergovernmental--2562562,819
Investment income300300(576)(876)1,164
Total revenues24,30024,30021,451(2,849)27,169
Expenditures:
Current:
Public works31,07137,54642,459(4,913)24,674
Revenues over (under) expenditures(6,771)(13,246)(21,008)(7,762)2,495
Other financing sources (uses):
Transfers out(5,007)(5,007)(5,007)--
Net increase (decrease) in fund balance$(11,778)$(18,253)(26,015)$(7,762)2,495
Fund balance (deficit) - January 124,17721,682
Fund balance (deficit) - December 31$(1,838)$24,177
CITY OF ANDOVER, MINNESOTA
SPECIAL REVENUE FUND - DRAINAGE AND MAPPINGStatement 21
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
For The Year Ended December 31, 2003
With Comparative Actual Amounts For The Year Ended December 31, 2002
Variance with
Final Budget -
Budgeted Amounts
Positive2002
OriginalFinalActual(Negative)Actual
Revenues:
Charges for services$10,500$10,500$8,444$(2,056)$10,691
Investment income--2,0482,048-
Miscellaneous----629
Total Revenues10,50010,50010,492(8)11,320
Expenditures:
Current:
Public works13,45013,45012,6028489,347
Revenues over (under) expenditures(2,950)(2,950)(2,110)8401,973
Other financing sources (uses):
Transfers in40,05740,05740,057-1,630
Net increase (decrease) in fund balance$37,107$37,10737,947$8403,603
Fund balance (deficit) - January 1(10,445)(14,048)
Fund balance (deficit) - December 31$27,502$(10,445)
CITY OF ANDOVER, MINNESOTA
SPECIAL REVENUE FUND - EDA GENERALStatement 22
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
For The Year Ended December 31, 2003
With Comparative Actual Amounts For The Year Ended December 31, 2002
Variance with
Final Budget -
Budgeted Amounts
Positive
OriginalFinalActual(Negative)Actual
Revenues:
Charges for services$-$-$32,863$-$2
Miscellaneous88,00088,000114,49026,49088,000
Total revenues88,00088,000147,35326,49088,002
Expenditures:
Current:
Economic development147,661147,661182,038(34,377)155,684
Capital outlay:
Economic development35,00035,000-35,000-
Total expenditures182,661182,661182,038623155,684
Revenues over (under) expenditures(94,661)(94,661)(34,685)27,113(67,682)
Other financing sources (uses):
Transfers in--46,49746,497-
Proceeds from sale of capital assets101,440101,440-(101,440)-
Total financing sources (uses)101,440101,44046,497(54,943)-
Net increase (decrease) in fund balance$6,779$6,77911,812$(27,830)(67,682)
Fund balance (deficit) - January 19,13276,814
Fund balance (deficit) - December 31$20,944$9,132
CITY OF ANDOVER, MINNESOTA
SPECIAL REVENUE FUND - TRAIL AND TRANSPORTATIONStatement 23
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
For The Year Ended December 31, 2003
With Comparative Actual Amounts For The Year Ended December 31, 2002
Variance with
Final Budget -
Budgeted Amounts
Positive2002
OriginalFinalActual(Negative)Actual
Revenues:
Intergovernmental$-$-$5,925$5,925$-
Charges for services80,00080,00079,930(70)26,344
Investment income2,6002,6002,9973971,798
Total revenues82,60082,60088,8526,25228,142
Expenditures:
Current:
Public works--6,009(6,009)5,888
Capital outlay:
Public works35,00035,00043,864(8,864)106,003
Total expenditures35,00035,00049,873(14,873)111,891
Net increase (decrease) in fund balance$47,600$47,60038,979$(8,621)(83,749)
Fund balance (deficit) - January 151,157134,906
Fund balance (deficit) - December 31$90,136$51,157
CITY OF ANDOVER, MINNESOTA
SPECIAL REVENUE FUND - RIGHT-OF-WAY MANAGEMENT/UTILITYStatement 24
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
For The Year Ended December 31, 2003
With Comparative Actual Amounts For The Year Ended December 31, 2002
Variance with
Final Budget -
Budgeted Amounts
Positive
OriginalFinalActual(Negative)Actual
Revenues:
Charges for services$32,950$32,950$69,065$36,115$137,735
Investment income1,0001,0007,3556,3556,877
Total revenues33,95033,95076,42042,470144,612
Expenditures:
Current:
Public works65,10165,10158,4256,67642,785
Revenues over (under) expenditures(31,151)(31,151)17,99549,146101,827
Other financing sources (uses):
Transfers out(10,014)(10,014)(10,014)--
Net increase (decrease) in fund balance$(41,165)$(41,165)7,981$49,146101,827
Fund balance (deficit) - January 1199,60897,781
Fund balance (deficit) - December 31$207,589$199,608
CITY OF ANDOVER, MINNESOTA
SPECIAL REVENUE FUND - CAPITAL EQUIPMENT RESERVEStatement 25
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
For The Year Ended December 31, 2003
With Comparative Actual Amounts For The Year Ended December 31, 2002
Variance with
Final Budget -
Budgeted Amounts
Positive
OriginalFinalActual(Negative)Actual
Revenues:
General property taxes$203,200$75,565$67,887$(7,678)$177,805
Intergovernmental--79579520,295
Investment income20,00020,00019,957(43)10,864
Miscellaneous--6356354,649
Total revenues223,20095,56589,274(6,291)213,613
Expenditures:
Current:
General government3,0003,00018,051(15,051)107,431
Capital outlay:
Public safety137,210137,21021,276115,93427,717
Sanitation----65,215
Parks and recreation----31,898
Total expenditures140,210140,21039,327100,883232,261
Revenues over (under) expenditures82,990(44,645)49,94794,592(18,648)
Other financing sources (uses):
Transfers in20,00020,00020,000-20,733
Transfers out(225,000)(225,000)(25,000)200,000(731,517)
Proceeds from the sale of capital assets--19,75119,75144,905
Total financing sources (uses)(205,000)(205,000)14,751219,751(665,879)
Net increase (decrease) in fund balance$(122,010)$(249,645)64,698$314,343(684,527)
Fund balance (deficit) - January 1667,1081,351,635
Fund balance (deficit) - December 31$731,806$667,108
CITY OF ANDOVER, MINNESOTA
SPECIAL REVENUE FUND - CONSTRUCTION SEAL COATINGStatement 26
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
For The Year Ended December 31, 2003
With Comparative Actual Amounts For The Year Ended December 31, 2002
Variance with
Final Budget -
Budgeted Amounts
Positive
OriginalFinalActual(Negative)Actual
Revenues:
Charges for services$18,677$18,677$21,361$2,684$-
Investment income11,00011,00019,7948,79427,580
Total revenues29,67729,67741,15511,47827,580
Expenditures:
Current:
Public works18,67718,67733,218(14,541)33,218
Revenue over (under) expenditures11,00011,0007,937(3,063)(5,638)
Other financing sources (uses)
Transfers in----10,450
Net increase (decrease) in fund balance$11,000$11,0007,937$(3,063)4,812
Fund balance (deficit) - January 1127,94189,911
Fund balance (deficit) - December 31$135,878$94,723
INTERNAL SERVICE FUNDS
Internal Service Funds are used to account for the financing of goods or services provided by one department or
agency to other departments or agencies of the government and to other government units, on a cost reimbursement
basis. The City of Andover had the following Internal Service Funds during the year:
Central Equipment Maintenance– This fund accounts for the maintenance of the equipment for the City.
Risk Management– This fund accounts for the expenditures in payment of insurance deductibles, loss reduction,
safety training and administrative expense.
CITY OF ANDOVER, MINNESOTA
COMBINING STATEMENT OF NET ASSETSStatement 27
INTERNAL SERVICE FUNDS
December 31, 2003
With Comparative Totals for December 31, 2002
Central
Totals
EquipmentRisk
MaintenanceManagement20032002
Assets
Current assets:
Cash and cash equivalents$131,946$66,681$198,627$168,757
Accrued interest497175672557
Prepaid items-44,58044,58035,851
Inventories - at cost49,905-49,90545,757
Total assets182,348111,436293,784250,922
Liabilities
Current liabilities:
Accounts payable4,2961004,3965,359
Due to other governmental units93960999858
Salaries payable6,4154796,8946,697
Total liabilities11,65063912,28912,914
Net assets
Unrestricted$170,698$110,797$281,495$238,008
CITY OF ANDOVER, MINNESOTA
COMBINING STATEMENT OF REVENUES, EXPENSES AND Statement 28
CHANGES IN FUND NET ASSETS
INTERNAL SERVICE FUNDS
For The Year Ended December 31, 2003
With Comparative Totals For The Year Ended December 31, 2002
Central
Totals
EquipmentRisk
MaintenanceManagement20032002
Operating revenues:
User charges$427,001$-$427,001$435,998
Other100232,759232,85931,235
Total operating revenues427,101232,759659,860467,233
Operating expenses:
Personal services174,99249,591224,583179,449
Supplies143,05943143,102125,844
Other service charges73,196179,710252,906104,014
Total operating expenses391,247229,344620,591409,307
Operating income (loss)35,8543,41539,26957,926
Nonoperating revenues (expenses):
Investment income3,7334854,2188,106
Change in net assets39,5873,90043,48766,032
Net assets - January 1131,111106,897238,008171,976
Net assets - December 31$170,698$110,797$281,495$238,008
CITY OF ANDOVER, MINNESOTA
COMBINING STATEMENT OF CASH FLOWSStatement 29
INTERNAL SERVICE FUNDS
For The Year Ended December 31, 2003
With Comparative Totals For The Year Ended December 31, 2002
Central
Totals
EquipmentRisk
MaintenanceManagement20032002
Cash flows from operating activities:
Receipts from customers and users$427,101$232,759$659,860$467,233
Payment to suppliers(221,335)(188,372)(409,707)(284,286)
Payment to employees(174,877)(49,509)(224,386)(180,300)
Net cash flows from operating activities30,889(5,122)25,7672,647
Cash flows from investing activities:
Investment income3,5585454,1037,765
Net increase in cash and cash equivalents34,447(4,577)29,87010,412
Cash and cash equivalents - January 197,49971,258168,757158,345
Cash and cash equivalents - December 31$131,946$66,681$198,627$168,757
Reconciliation of operating income to net cash provided
(used) by operating activities:
Operating income (loss) $35,854$3,415$39,269$57,926
Adjustments to reconcile operating income (loss)
to net cash flows from operating activities:
Changes in assets and liabilities:
Decrease (increase) in prepaid items-(8,729)(8,729)(35,851)
Decrease (increase) in inventory(4,148)-(4,148)(16,451)
Increase (decrease) in accounts payable(1,063)100(963)(2,984)
Increase (decrease) in due to other governmental units13110141858
Increase (decrease) in salaries payable11582197571
Increase (decrease) in compensated absences---(1,422)
Total adjustments(4,965)(8,537)(13,502)(55,279)
Net cash provided by operating activities$30,889$(5,122)$25,767$2,647
AGENCY FUNDS
Agency Funds are used to account for assets held by the City in a trustee capacity or as an agent for individuals,
private organizations and/or other governmental units. The City of Andover had the following Agency Funds during
the year:
General Escrow– This fund is used to account for distribution of funds for insurance premiums of retirees.
General Agency– This fund is used to account for the collection and distribution of funds relating to development
activities.
CITY OF ANDOVER, MINNESOTA
COMBINING STATEMENT OF NET ASSETSStatement 30
FIDUCIARY FUNDS
December 31, 2003
BalanceBalance
January 1,December 31,
2003AdditionsDeletions2003
General Escrow Fund
Assets
Cash and investments$23,891$28,548$(11,126)$41,313
Liabilities
Deposits payable23,89128,548(11,126)41,313
Total liabilities$23,891$28,548$(11,126)$41,313
General Agency Fund
Assets
Cash and investments$305,456$522,710$(433,783)$394,383
Liabilities
Accounts payable-6,978(6,489)489
Contracts payable2,2483,620(2,248)3,620
Deposits payable303,208512,112(425,046)390,274
Total liabilities$305,456$522,710$(433,783)$394,383
Total Fiduciary Funds
Assets
Cash and investments$329,347$551,258$(444,909)$435,696
Liabilities
Accounts payable-6,978(6,489)489
Contracts payable2,2483,620(2,248)3,620
Deposits payable327,099540,660(436,172)431,587
Total liabilities$329,347$551,258$(444,909)$435,696
CAPITAL ASSETS USED IN THE OPERATION OF GOVERNMENTAL FUNDS
CITY OF ANDOVER, MINNESOTA
SCHEDULE OF CAPITAL ASSETS USED IN THE OPERATIONStatement 31
OF GOVERNMENTAL FUNDS
SCHEDULE BY SOURCE
For The Year Ended December 31, 2003
BalanceBalance
January 1,December 31,
Description2003AdditionsDeletions2003
Land and improvements$8,013,110$453,717$(198,674)$8,268,153
Buildings and improvements5,710,212126,556(84,393)5,752,375
Furniture and equipment59,38728,228-87,615
Machinery and equipment5,399,634199,839(509,122)5,090,351
Other park improvements2,774,922235,797(10,000)3,000,719
Streets and trails69,740,833867,955-70,608,788
Storm sewers7,045,960-(7,045,960)-
Construction in progress1,162,1373,537,401(1,045,212)3,654,326
Totals$99,906,195$5,449,493$(8,893,361)$96,462,327
Investments in Capital Assets from:
General Fund$569,433
Special Revenue Funds502,554
Capital Project Funds95,263,792
Donations51,577
Other74,971
Total investments in capital assets$96,462,327
CITY OF ANDOVER, MINNESOTA
CAPITAL ASSETS USED IN THE OPERATION
OF GOVERNMENTAL FUNDS
SCHEDULE BY FUNCTION AND ACTIVITY
December 31, 2003
Land &Buildings &Furniture &Machinery &
Function and ActivityImprovementsImprovementsEquipmentEquipment
General government:
Administration$-$1,710,318$-$-
Financial adminstration--22,787-
Planning and zoning---14,312
Information services--22,689-
Engineering--18,29761,365
Total general government-1,710,31863,77375,677
Public safety:
Fire protection-1,254,56623,8422,103,963
Protective inspection---104,107
Civil defense-148,476-6,928
Total public safety-1,403,04223,8422,214,998
Public works:
Streets and highways-2,248,321-2,047,488
Snow and ice removal---6,390
Street signs---22,679
Total public works-2,248,321-2,076,557
Parks and recreation3,481,376390,694-723,119
Economic development4,786,777---
Construction in progress----
Totals$8,268,153$5,752,375$87,615$5,090,351
Statement 32
Other ParkStreets &Construction
ImprovementsTrailsIn ProgressTotal
$-$-$-$1,710,318
---22,787
---14,312
---22,689
---79,662
---1,849,768
---3,382,371
---104,107
---155,404
---3,641,882
-70,608,788-74,904,597
---6,390
---22,679
-70,608,788-74,933,666
3,000,719--7,595,908
---4,786,777
--3,654,3263,654,326
$3,000,719$70,608,788$3,654,326$96,462,327
CITY OF ANDOVER, MINNESOTA
CAPITAL ASSETS USED IN THE OPERATIONStatement 33
OF GOVERNMENTAL FUNDS
SCHEDULE BY FUNCTION AND ACTIVITY
December 31, 2003
BalanceBalance
January 1,December 31,
Function and Activity2003AdditionsDeletions2003
General government:
Administration$1,710,318$-$-$1,710,318
Financial adminstration22,787--22,787
Planning and zoning14,312--14,312
Information services-22,689-22,689
Engineering104,522-(24,860)79,662
Total general government1,851,93922,689(24,860)1,849,768
Public safety:
Fire protection3,373,05626,815(17,500)3,382,371
Protective inspection104,107--104,107
Civil defense131,248108,549(84,393)155,404
Total public safety3,608,411135,364(101,893)3,641,882
Public works:
Streets and highways74,214,6021,027,865(337,870)74,904,597
Snow and ice removal6,390--6,390
Street signs22,679--22,679
Total public works74,243,6711,027,865(337,870)74,933,666
Sanitation:
Storm sewers7,136,949-(7,136,949)-
Parks and recreation6,917,637726,174(47,903)7,595,908
Economic development4,985,451-(198,674)4,786,777
Construction in progress1,162,1373,537,401(1,045,212)3,654,326
Totals$99,906,195$5,449,493$(8,893,361)$96,462,327
SUPPLEMENTARY FINANCIAL INFORMATION
CITY OF ANDOVER, MINNESOTA
COMBINED SCHEDULE OF INDEBTEDNESS
December 31, 2003
Authorized
IssueMaturityInterestand
DateDateRateIssue
GOVERNMENTAL ACTIVITIES:
General Obligation Revenue Bonds:
1997 Public Project Revenue Bonds9/1/199712/1/20164.50-5.90%$2,350,000
Special Assessment Bonds:
1993A G.O. Improvement Bonds8/1/19938/1/20034.00-4.75%3,650,000
1994C G.O. Improvement Bonds10/1/19942/1/20065.05-5.75%1,140,000
1995A G.O. Improvement Bonds7/1/19952/1/20064.85-5.30%2,605,000
1997B G.O. Improvement Bonds7/1/199712/1/20033.90-4.70%6,315,000
Total special assessment bonds13,710,000
Tax Increment Bonds:
1994B G.O. Tax Increment Refunding Bonds5/1/19945/1/20046.97-7.87%885,000
1995D Tax Increment Bonds10/1/19952/1/20134.50-5.60%6,055,000
1996 Tax Increment Bonds6/1/19968/1/20124.75-5.40%2,055,000
1999 Tax Increment Bonds6/1/199912/1/20124.00-5.00%1,500,000
2000A Tax Increment Bonds9/1/20002/1/20106.80-7.10%2,445,000
2003B G.O. Tax Increment Refunding Bonds6/1/20038/1/20102.00-3.00%1,530,000
Total tax increment bonds14,470,000
Certificates of Indebtedness:
1999 G.O. Equipment Certificates6/1/19992/1/20043.70-4.00%1,050,000
2001C G.O. Capital Notes6/5/20012/1/20062.90-3.80%1,210,000
2003 G.O. Equipment Certificates3/11/20036/1/20041.50-1.75%394,000
2003C G.O. Equipment Certificates12/18/200312/1/20061.50%400,000
Total certificates of indebtedness3,054,000
Permanent Improvement Revolving Bonds:
2000B Permanent Improvement Revolving Bonds9/1/20002/1/20074.20-4.375%3,350,000
2001A Permanent Improvement Revolving Bonds6/5/20012/1/20073.20-4.00%4,975,000
2003A Permanent Improvement Revolving Bonds6/1/20032/1/20102.00-2.60%4,580,000
Total permanent improvement revolving bonds12,905,000
State Aid Bonds:
2001B State Aid Street Bonds6/5/20012/1/20172.90-5.00%2,755,000
Total Bonded Indebtedness49,244,000
Compensated absences347,534
Total governmental activities indebtedness49,591,534
BUSINESS-TYPE ACTIVITIES:
General Obligation Revenue Bonds:
2002 G.O. Water Revenue Bonds5/9/20022/1/20232.30-5.00%9,780,000
Compensated absences58,967
Total business-type activities indebtedness9,838,967
Total City indebtedness$59,430,501
Exhibit 1
Principal Payments
2004 Payment
PriorCurrentOutstanding
YearsYear12/31/03PrincipalInterestTotal
$235,000$70,000$2,045,000$80,000$116,740$196,740
3,285,000365,000----
680,000120,000340,000340,0009,531349,531
1,410,000280,000915,000915,00023,798938,798
5,540,000775,000----
10,915,0001,540,0001,255,0001,255,00033,3291,288,329
720,00090,00075,00075,0002,95177,951
1,055,000225,0004,775,000250,000242,225492,225
435,0001,620,000----
130,000110,0001,260,000140,00054,250194,250
150,000120,0002,175,000210,000150,712360,712
--1,530,000185,00039,457224,457
2,490,0002,165,0009,815,000860,000489,5951,349,595
475,000270,000305,000305,0006,100311,100
220,000230,000760,000240,00023,517263,517
-194,000200,000200,0002,567202,567
--400,000154,0005,817159,817
695,000694,0001,665,000899,00038,001937,001
-610,0002,740,0002,740,00059,1262,799,126
-920,0004,055,000955,000134,9391,089,939
--4,580,000-115,389115,389
-1,530,00011,375,0003,695,000309,4544,004,454
160,000125,0002,470,000130,000106,788236,788
14,495,0006,124,00028,625,0006,919,0001,093,9078,012,907
--347,534---
14,495,0006,124,00028,972,5346,919,0001,093,9078,012,907
--9,780,000310,000429,438739,438
--58,967---
--9,838,967310,000429,438739,438
$14,495,000$6,124,000$38,811,501$7,229,000$1,523,345$8,752,345
CITY OF ANDOVER, MINNESOTA
SCHEDULE OF TAX CAPACITY RATES AND LEVIESExhibit 2
Taxes Payable
20042003
Tax capacity values$20,561,438$17,951,904
Captured tax increment value(1,383,714)(1,199,777)
Fiscal disparities - contribution(567,147)(503,337)
Local taxable value18,610,57716,248,790
Fiscal disparities - distribution2,862,3342,510,373
Adjusted tax capacity$21,472,911$18,759,163
20042003
CertifiedTax CapacityCertifiedTax Capacity
LevyRateLevyRate
General Revenue Levy:
General Fund$4,850,296$4,505,780
Fire Relief43,75043,750
Capital Equipment/Projects203,200203,200
Parks Projects50,80050,800
Road and Bridge619,611619,611
Total General Revenue Levy5,767,65726.651%5,423,14128.899%
Debt Service Levy:
1999 G.O. Equipment Certificate326,655301,980
2001C G.O. Capital Note276,693274,404
2003 G.O. Equipment Certificate212,695200,000
2003C G.O. Equipment Certificate168,000-
Total Debt Service Levy984,0434.547%776,3844.138%
Lower Rum River Watershed30,0000.394%24,0000.339%
Total$6,781,70031.592%$6,223,52533.376%
CITY OF ANDOVER, MINNESOTA
SCHEDULE OF DEFERRED TAX LEVIESExhibit 3
GENERAL OBLIGATION BONDS
December 31, 2003
Tax Increment Bonds
Taxes
Payable1994B1995D19992000A2003BTotal
2004$77,951$492,225$194,250$360,712$224,457$1,349,595
2005-577,950188,650438,475230,1201,435,195
2006-634,350182,980431,600236,1201,485,050
2007-638,125177,170429,025236,9201,481,240
2008-639,988171,290439,787247,6201,498,685
2009-639,875165,270447,275253,0201,505,440
2010-637,962159,110222,633257,5001,277,205
2011-658,525152,880--811,405
2012-651,500146,450--797,950
2013-642,500---642,500
$77,951$6,213,000$1,538,050$2,769,507$1,685,757$12,284,265
EDA Public
Project
Certificates of Indebtedness
TaxesRevenue Bonds
Payable19992001C20032003CTotalof 1997
2004$326,655$276,693$212,695$168,000$984,043$196,740
2005-269,724-125,741395,465202,580
2006-270,035-125,886395,921207,810
2007-----212,410
2008-----216,415
2009-----224,815
2010-----232,255
2011-----238,705
2012-----244,217
2013-----248,778
2014-----262,370
2015-----269,500
2016-----275,340
$326,655$816,452$212,695$419,627$1,775,429$3,031,935
Total
TaxesDeferred
PayableTax Levies
2004$2,530,378
20052,033,240
20062,088,781
20071,693,650
20081,715,100
20091,730,255
20101,509,460
20111,050,110
20121,042,167
2013891,278
2014262,370
2015269,500
2016275,340
$17,091,629
CITY OF ANDOVER, MINNESOTA
SCHEDULE OF FUND TRANSFERSExhibit 4
December 31, 2003
TransferTransfer
InOut
General Fund
Sewer Fund$30,000$-General Fund Admin Allocation
Water fund110,000-General Fund Admin Allocation
Capital Equipment Reserve25,000-General Fund Admin Allocation
EDA Revenue Bonds-190,310Debt Service Payment
Total General Fund165,000190,310
Special Revenue Funds
EDA General
Tax Increment Projects Fund46,497-Transfer PY Admin Allocation
LRRWMO
Drainage & Mapping-5,007GIS Contract Allocation
Drainage & Mapping
Water Fund12,518-GIS Contract Allocation
Sewer Fund12,518-GIS Contract Allocation
ROW10,014-GIS Contract Allocation
LRRWMO5,007-GIS Contract Allocation
40,057-
ROW
Drainage & Mapping-10,014GIS Contract Allocation
Capital Equipment Reserve
Sewer Fund20,000-Capital Equipment Reserve
General Fund-25,000General Fund Admin Allocation
20,00025,000
Total Special Revenue Funds106,55440,021
Debt Service Funds
1993A G.O. Improvement Bond
Water Trunk Fund160,520-Debt Service Allocation
Sewer Trunk Fund37,043-Debt Service Allocation
Sewer Fund111,129-Debt Service Allocation
1997B G.O. Improvement Bond-42,027Close Fund
308,69242,027
1994B G.O. Tax Increment Bonds
Tax Increment Projects Fund13,680-
1994C G.O. Improvement Bond
Water Trunk Fund23,244-Debt Service Allocation
Sewer Trunk Fund5,364-Debt Service Allocation
Sewer Fund16,092-Debt Service Allocation
44,700-
1995A G.O. Improvement Bond
Water Trunk Fund157,404-Debt Service Allocation
Sewer Trunk Fund36,324-Debt Service Allocation
Sewer Fund108,972-Debt Service Allocation
1997B G.O. Improvement Bond-321,900Close Fund
302,700321,900
1995D & 1996A G.O. Tax Increment Bonds
Tax Increment Projects Fund109,440-Debt Service Allocation
2003B Tax Increment Refunding Bonds1,515,000-Refunding TIF Bond
$1,624,440$-
(Continued)
CITY OF ANDOVER, MINNESOTA
SCHEDULE OF FUND TRANSFERSExhibit 4
December 31, 2003(Continued)
TransferTransfer
InOut
1997B G.O. Improvement Bond
1993A G.O. Improvement Bond$42,027$-
1995A G.O. Improvement Bond321,900-
Water Trunk Fund213,315-Debt Service Allocation
Sewer Trunk Fund49,226-Debt Service Allocation
Sewer Fund147,680-Debt Service Allocation
774,148-
1999 G.O. Tax Increment Bonds
Tax Increment Projects Fund45,600-Debt Service Allocation
2000A G.O. Tax Increment Bonds
Tax Increment Projects Fund59,280-Debt Service Allocation
2000B PIR Bonds
PIR Capital Projects Fund742,022-Debt Service Allocation
2001A PIR Bonds
PIR Capital Projects Fund1,086,483-Debt Service Allocation
2001C G.O. Capital Note
Sewer Fund7,000-Debt Service Allocation
Water Fund13,000-Debt Service Allocation
20,000-
EDA Revenue Bonds
General Fund190,310-Debt Service Payment
2003A PIR Bonds
PIR Capital Projects Fund45,103-Capitalized Interest
2003B Tax Increment Refunding Bonds
1995D & 1996A G.O. Tax Increment Bonds-1,515,000Refunding TIF Bond
Total Debt Service Funds5,257,1581,878,927
Capital Projects Funds
Water Trunk Fund
Water Fund350,000-Replacement Reserve
1997B G.O. Improvement Bond-213,315Debt Service Allocation
1995A G.O. Improvement Bond-157,404Debt Service Allocation
1994C G.O. Improvement Bond-23,244Debt Service Allocation
1993A G.O. Improvement Bond-160,520Debt Service Allocation
PIR Capital Projects Fund-333,752Well #8 Reimbursement
Water Fund-505,170Debt Service Allocation
350,0001,393,405
Sewer Trunk Fund
Sewer Fund390,000-Replacement Reserve
1993A G.O. Improvement Bond-37,043Debt Service Allocation
1994C G.O. Improvement Bond-5,364Debt Service Allocation
1995A G.O. Improvement Bond-36,324Debt Service Allocation
1997B G.O. Improvement Bond-49,226Debt Service Allocation
$390,000$127,957
(Continued)
CITY OF ANDOVER, MINNESOTA
SCHEDULE OF FUND TRANSFERSExhibit 4
December 31, 2003(Continued)
TransferTransfer
InOut
Tax Increment Projects Fund
EDA General$-$46,497Transfer PY Admin Allocation
1995D & 1996A G.O. Tax Increment Bonds-109,440Debt Service Allocation
1994B G.O. Tax Increment Bonds-13,680Debt Service Allocation
1999 G.O. Tax Increment Bonds-45,600Debt Service Allocation
2000A G.O. Tax Increment Bonds-59,280Debt Service Allocation
Building Fund-846,208Pre-1998 TIF Interest Transfer
-1,120,705
Building Fund
Tax Increment Projects Fund846,208-Pre-1998 TIF Interest Transfer
PIR Capital Projects Fund
Water Trunk Fund333,752-Well #8 Reimbursement
2000B PIR Bonds-742,022Debt Service Allocation
2001A PIR Bonds-1,086,483Debt Service Allocation
2003A PIR Bonds-45,103Capitalized Interest
333,7521,873,608
Total Capital Projects Funds1,919,9604,515,675
Enterprise Funds
Water Fund
Water Trunk Fund505,170-Debt Service Allocation
General Fund-110,000General Fund Admin Allocation
Water Trunk Fund-350,000Replacement Reserve
2001C G.O. Capital Note-13,000Debt Service Allocation
Drainage & Mapping-12,518GIS Contract Allocation
505,170485,518
Sewer Fund
General fund-30,000General Fund Admin Allocation
Capital Equipment Reserve-20,000Capital Equipment Reserve
2001C G.O. Capital Note-7,000Debt Service Allocation
Drainage & Mapping-12,518GIS Contract Allocation
Sewer Trunk Fund-390,000Replacement Reserve
1993A G.O. Improvement Bond-111,129Debt Service Allocation
1994C G.O. Improvement Bond-16,092Debt Service Allocation
1995A G.O. Improvement Bond-108,972Debt Service Allocation
1997B G.O. Improvement Bond-147,680Debt Service Allocation
-843,391
Total Enterprise Funds505,1701,328,909
Total All Funds$7,953,842$7,953,842
III. STATISTICAL SECTION (UNAUDITED)
CITY OF ANDOVER, MINNESOTA
GOVERNMENT-WIDE EXPENSES BY FUNCTIONTable 1
Last Two Fiscal Years
(Unaudited)
Function20032002
General government$2,431,252$2,386,568
Public safety2,766,6942,474,284
Public works3,361,2574,819,429
Sanitation160,548264,671
Parks and recreation802,131856,806
Recycling115,016116,344
Economic development470,172720,460
Interest on long-term debt1,255,8891,667,943
Water1,737,5951,526,526
Sewer1,344,8571,206,865
Storm sewer168,203-
Total$14,613,614$16,039,896
Government-wide expenses are not available for years prior to 2002.
2003 GOVERNMENT-WIDE EXPENSES BY FUNCTION
Storm sewer
Sewer
1%
General government
9%
17%
Water
12%
Public safety
Interest
19%
9%
Econ dev
3%
Recycling
1%
Park & rec
Public works
5%
23%
Sanitation
1%
CITY OF ANDOVER, MINNESOTA
GOVERNMENT-WIDE REVENUES BY SOURCETable 2
Last Two Fiscal Years
(Unaudited)
20032002
Program Revenues:
Charges for services$4,549,454$4,179,886
Operating grants and contributions732,011946,495
Capital grants and contributions5,292,2906,223,233
General Revenues:
General property taxes5,682,4985,076,374
Tax increment collections1,140,040842,607
Grants and contributions not restricted
to specific programs158,694763,049
Unrestricted investment earnings434,7981,279,313
Gain on sale of capital assets601,5411,316,054
Total$18,591,326$20,627,011
Government-wide revenues are not available for years prior to 2002.
2003 GOVERNMENT-WIDE REVENUES BY SOURCE
Unrestricted investment
earnings
2%
Charges for services
24%
General property taxes
32%
Operating grants &
contributions
Grants and
4%
contributions not
restricted to specific
programs
1%
Tax increment
Capital grants &
collections
contributions
Gain on sale of capital
6%
28%
assets
3%
CITY OF ANDOVER, MINNESOTA
GENERAL FUNDTable 3
REVENUES BY SOURCE
Last Ten Fiscal Years
(Unaudited)
GeneralLicenseCharges
FiscalPropertyandInter-forInvestment
YearTaxesPermitsgovernmentalServicesFinesIncomeMiscellaneousTotal
1994$1,472,108$410,733$745,156$227,960$40,496$43,043$48,280$2,987,776
19951,810,213410,212747,627549,60646,15215,71616,2703,595,796
19962,180,470390,327857,689447,19957,12552,653116,3964,101,859
19972,383,965456,413988,814578,22148,80071,224186,8634,714,300
19982,804,065694,809880,6971,018,44148,923177,570180,8655,805,370
19993,125,776609,344864,985754,62978,39662,041205,9245,701,095
20003,571,186623,662969,317900,23582,443104,657204,5806,456,080
20013,982,174720,7121,095,727722,69073,699128,701201,2216,924,924
20023,782,334588,9651,043,272689,42773,475109,524208,7906,495,787
20034,286,838551,385508,054647,81368,686(9,104)226,8686,280,540
2003 GENERAL FUND REVENUES BY SOURCE
Investment Income
Miscellaneous
0%
4%
Charges for Services
10%
Intergovernmental
8%
License & Permits
9%
Fines
1%
General Property Tax
68%
CITY OF ANDOVER, MINNESOTA
GENERAL FUNDTable 4
EXPENDITURES BY FUNCTION
Last Ten Fiscal Years
(Unaudited)
FiscalGeneralPublicPublicParks andEconomic
YearGovernmentSafetyWorksSanitationRecreationRecyclingDevelopmentUnallocatedTotal
1994$804,726$970,174$625,805$51,522$294,158$49,574$21,916$86,278$2,904,153
1995932,4601,060,210637,55134,795329,41658,2602293,5463,146,260
19961,068,5851,320,680947,47260,517455,51755,170-154,0854,062,026
19971,252,0471,409,0871,044,18395,632383,05962,281-212,5034,458,792
19981,551,4101,528,2821,005,394101,039461,13176,773-75,9504,799,979
19991,700,0861,820,4361,363,875119,957579,91688,307-97,0325,769,609
20001,840,6441,968,7651,591,137100,073538,52391,071-133,3216,263,534
20011,750,5742,087,9241,284,491135,189584,647108,390-145,0686,096,283
20022,103,7352,352,9091,212,143107,661662,450116,005-30,6146,585,517
20031,915,3142,631,9911,126,29280,901599,004114,784-25,8656,494,151
2003 GENERAL FUND EXPENDITURES BY FUNCTION
Recycling
2%
Park & rec
9%
Sanitation
1%
General government
29%
Public works
17%
Unallocated
0%
Public safety
42%
CITY OF ANDOVER, MINNESOTA
PROPERTY TAX LEVIES AND COLLECTIONSTable 5
Last Ten Fiscal Years
(Unaudited)
TotalDelinquent
TotalCurrentPercentDelinquentTotalCollectionsOutstandingTaxes
TaxTaxof LevyTaxTaxas a Percent ofDelinquentas a Percent of
YearLevyCollectionCollectedCollectionsCollectionsCurrent LevyTaxesCurrent Levy
1994$1,806,293$1,774,50798.24%$43,566$1,818,073100.65%$61,4363.40%
19952,139,2782,114,58798.85%44,0842,158,671100.91%50,8272.38%
19962,083,0312,075,33699.63%29,2312,104,567101.03%49,1952.36%
19972,332,2112,306,99998.92%27,2492,334,248100.09%50,2382.15%
19982,698,8712,632,77297.55%27,9942,660,76698.59%151,7165.62%
19993,099,4612,960,83995.53%30,3012,991,14096.51%362,24311.69%
20003,321,9073,283,67198.85%171,7023,455,373104.02%83,2152.51%
20013,873,9483,824,25798.72%39,2263,863,48399.73%129,5623.34%
20024,206,4014,147,76498.61%42,7884,190,55299.62%93,8232.23%
20034,852,6044,770,42798.31%59,8844,830,31199.54%105,0442.16%
CITY OF ANDOVER, MINNESOTA
SPECIAL ASSESSMENT LEVIES AND COLLECTIONSTable 6
Last Ten Fiscal Years
(Unaudited)
TotalDelinquent
CollectionsTaxes
CurrentCurrentPercent ofDelinquentTotalas a Percent ofOutstandingas a Percent of
AssessmentsAssessmentsAssessmentsAssessmentAssessmentCurrentDelinquentCurrent
YearDueCollectedCollectedCollectionsCollectionsAssessments DueAssessmentsAssessments Due
1994$557,611$505,50090.65%$44,004$549,50498.55%$153,74327.57%
1995569,629517,98190.93%28,672546,65395.97%87,35515.34%
1996573,477531,08192.61%28,594559,67597.59%55,7819.73%
1997511,834494,28196.57%27,445521,726101.93%32,1746.29%
1998540,783458,65584.81%19,787478,44288.47%72,34213.38%
1999472,647444,08093.96%38,568482,648102.12%71,48915.13%
2000433,242424,85498.06%36,374461,228106.46%15,8713.66%
2001432,207410,38094.95%5,933416,31396.32%26,2646.08%
2002328,831307,05193.38%5,694312,74595.11%37,40411.37%
2003533,340522,85198.03%5,917528,76899.14%49,3299.25%
CITY OF ANDOVER, MINNESOTA
ASSESSED AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTYTable 7
Years 1995 through 2004
(Unaudited)
Ratio of Tax
Real PropertyPersonal PropertyTotal
Capacity to
TaxEstimatedTaxEstimatedTaxEstimatedTotal Estimated
YearCapacityActual ValueCapacityActual ValueCapacityActual ValueActual Value
1995n/an/an/an/a$10,271,906n/an/a
1996n/an/an/an/a12,019,964n/an/a
1997n/an/an/an/a13,342,748n/an/a
1998n/an/an/an/a13,887,786n/an/a
1999n/an/an/an/a14,605,633n/an/a
2000$15,690,055$1,146,868,600$615,830$18,139,60016,305,885$1,165,008,2001.40%
200118,348,6621,312,767,000620,79718,285,50018,969,4591,331,052,5001.43%
200215,336,0751,479,078,600359,54017,999,80015,695,6151,497,078,4001.05%
200317,549,0641,699,227,100402,84020,202,30017,951,9041,719,429,4001.04%
200420,142,0881,945,523,200414,01620,761,10020,556,1041,966,284,3001.05%
Source: Anoka County Property Tax Division
CITY OF ANDOVER, MINNESOTA
RATIO OF NET BONDED DEBTTable 8
TO ASSESSED VALUE AND NET BONDED DEBT PER CAPITA
Last Ten Fiscal Years
(Unaudited)
LessRatio of
GrossCash andNetNet BondedNet Bonded
Net TaxBondedInvestmentsBondedDebt toDebt
YearPopulation (1)CapacityDebt (2)On HandDebtTax CapacityPer Capita
199419,465$9,993,705$2,060,000$(18,672)$2,041,32820%$105
199520,49710,877,3892,207,000(39,677)2,167,32320%106
199621,49512,803,2011,851,000(57,068)1,793,93214%83
199722,36914,112,3043,835,000(130,087)3,704,91326%166
199823,21314,674,0203,430,000(161,907)3,268,09322%141
199924,35815,439,0154,005,000(249,278)3,755,72224%154
200026,58817,207,5903,520,000(13,984)3,506,01620%132
200127,44620,188,3874,210,000(94,728)4,115,27220%150
200228,90816,573,7133,680,000(112,848)3,567,15222%123
200330,00018,759,1633,710,000(88,779)3,621,22119%121
(1) Source: Metropolitan Council
(2) Only includes debt supported by tax levy.
CITY OF ANDOVER, MINNESOTA
RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FORTable 9
GENERAL BONDED DEBT TO TOTAL GENERAL GOVERNMENTAL EXPENDITURES
Last Ten Fiscal Years
(Unaudited)
Ratio of
TotalDebt Service
InterestTotalGeneralto General
Debtand FiscalDebtGovernmentalGovernmental
YearPrincipalChargesServiceExpenditures (1)Expenditures
1994$6,468,000$1,391,180$7,859,180$16,070,30549%
19957,843,0001,283,0409,126,04020,191,97945%
19963,551,0001,399,2424,950,24216,491,20130%
19977,621,0001,632,9639,253,96326,041,86436%
19984,585,0001,537,5916,122,59118,409,96633%
19993,775,0001,377,2095,152,20919,937,02326%
20004,580,0001,392,3155,972,31521,766,36527%
20014,845,0001,753,9816,598,98120,273,05733%
20027,070,0001,796,7748,866,77422,388,56940%
20036,124,0001,302,3067,426,30622,808,15033%
(1) Includes all governmental fund types: The General Fund, Special Revenue Funds, Debt Service Funds and
Capital Projects Funds.
CITY OF ANDOVER, MINNESOTA
PROPERTY TAX RATES - Table 10
DIRECT AND OVERLAPPING GOVERNMENTS
Years 1995 through 2004
(Unaudited)
Taxes
PayableCity (1)SchoolCountyOtherTotal
1995-----
199619.59766.94831.0361.760119.341
199719.80457.91130.9101.780110.405
199821.82454.49730.6182.407109.346
199923.50857.09532.2652.472115.340
200022.73555.58930.8613.134112.319
200122.73650.23028.8592.850104.675
200233.51129.07037.9763.745104.302
200333.37627.80237.7143.755102.647
200431.58421.21835.3403.48291.624
(1) Includes the Lower Rum River Watershed
Source: Anoka County Property Tax Division
CITY OF ANDOVER, MINNESOTA
COMPUTATION OF DIRECT AND OVERLAPPING DEBTTable 11
INCLUDING DEBT RATIOS
December 31, 2003
(Unaudited)
BondedPercentageCity
Gross DebtApplicable toShare of
OutstandingCityDebt
Overlapping Debt:
Anoka County$80,983,0009.0659%$7,341,838
School Districts:
ISD No. 11 Anoka-Hennepin209,883,63712.7111%26,678,519
ISD No. 15 St. Francis37,555,0007.6764%2,882,872
Metro Council130,495,0000.8435%1,100,725
Total Overlapping Debt458,916,63738,003,954
Direct Debt:
City of Andover38,405,000100.0000%38,405,000
Total Overlapping and Direct Debt$497,321,637$76,408,954
Debt Ratios:
Ratio of debt per capita (30,000 population)$2,547
Ratio of debt to estimated taxable market value of $1,719,429,4004.44%
CITY OF ANDOVER, MINNESOTA
PRINCIPAL TAXPAYERSTable 12
December 31, 2003
(Unaudited)
EstimatedNet
PropertyMarketTax
Taxpayers
ClassificationValueCapacity
Anoka Electric / ConnexusUtility$10,198,200$187,734
Presbyterian Homes of AndoverApartment10,036,200150,544
Andover LTD PartnershipMall7,301,300145,276
116 LLCC/I5,752,700114,304
Minnegasco, Inc.Utility5,443,200108,114
United Power AssociationUtility3,541,50068,054
Columbia Park PropertiesMedical Clinic2,640,70052,064
William RademacherC/I2,554,20049,584
Northern States PowerUtility1,454,30029,086
Health PartnersMedical Clinic1,480,30028,856
CITY OF ANDOVER, MINNESOTA
BUILDING PERMITS, PROPERTY VALUES AND HOUSEHOLDSTable 13
Last Ten Fiscal Years
(Unaudited)
New Single Family HomesNew Commercial / IndustrialAll Permits (1)
YearPermitsValuationPermitsValuationPermitsValuationHouseholds (2)
1994400$40,557,0009$3,903,723859$47,478,8495,917
199530532,202,7761225,133,79683760,590,4236,300
199627228,776,00053,166,05181534,703,3806,610
199728230,844,00057,133,27591042,938,7266,881
199844853,742,1331012,625,9601,05769,529,3497,152
199941147,763,20051,404,0841,10755,075,0897,568
200034246,322,0001412,672,4481,13565,293,6148,107
200128543,378,128821,086,4811,22879,926,9738,439
200221831,848,0001910,616,85199750,401,1598,724
200318228,973,300134,764,0461,14043,191,0688,900
(1) Includes additions and remodelings.
(2) Source: Metropolitan Council
CITY OF ANDOVER, MINNESOTA
DEMOGRAPHICSTable 14
(Unaudited)
Percent
U.S. Census
of Change
199020002003*1990 - 2000
Population15,21626,58830,00074.74%
Households4,5198,1078,90079.40%
Household Size (Population/Household)3.373.283.37-2.60%
POPULATION DEMOGRAPHICS (2000 U.S. CENSUS)
Populaton by Age (2000 U.S. Census):PersonsPercent
4 and under2,4429.2%
5 - 92,82210.6%
10 - 142,76310.4%
15 - 192,0247.6%
20 - 249853.7%
25 - 343,84914.5%
35 - 445,83222.0%
45 - 543,48913.1%
55 - 591,0824.1%
60 - 645412.0%
65 - 744591.7%
75 - 842140.8%
85 and over860.3%
Total population26,588100.0%
Total female population13,069
Total male population13,519
2000 median age31.9 yrs
Occupation Breakdown:
Management, professional and related occupations37.0%
Service occupations10.5%
Sales and office occupations28.6%
Farming, fishing and forestry occupations0.1%
Construction, extraction and maintenance occupations10.0%
Production, transportation and material moving occupations13.8%
City ofAnokaState of
AndoverCountyMinnesota
Income Statistics:
1999 per capita income$26,317$23,297$23,198
1999 median household income76,24157,75447,111
1999 median family income78,78564,26156,874
2000 median gross rent772649566
2000 median value owner occupied housing158,400131,300122,400
CITY OF ANDOVER, MINNESOTA
MISCELLANEOUS STATISTICAL DATATable 15
December 31, 2003
(Unaudited)
Date incorporated1974
Form of governmentPlan A
Miles of streets
City176
County43
Storm sewer (miles)41
Watermain (miles)76
Sanitary sewer (miles)79
Parks:
Number59
Developed acreage541
Trails (miles)22
Acreage:
Developed13,360
Undeveloped9,680
Population:
2003 Estimate30,000
2000 U.S. Census26,588
1990 U.S. Census15,216
Housing units:
2003 Estimate8,900
2000 U.S. Census8,107
1990 U.S. Census4,519
Largest Employers in the City
Number of
FirmType of Business / ProductEmployees
ISD No 11 Anoka-HennepinElementary and secondary education523
Anoka County Parks and Highway DepartmentsCounty government and services247
Kottkes' Bus Service, Inc.Bus transportation173
Festival FoodsGrocery store120
Presbyterian Homes of AndoverSenior housing and assisted living facilities86
Ed Fields & Sons, Inc.Vegetable farming70
McDonald'sRestaurant60
Meadow Creek Christian SchoolPrivate education K-1260
City of AndoverMunicipal government and services59