2018.05.15 Council Meeting Packet
4141 Douglas Drive North • Crystal, Minnesota 55422-1696
Tel: (763) 531-1000 • Fax: (763) 531-1188 • www.crystalmn.gov
Posted: May 11, 2018
City Council Meeting Schedule
May 15, 2018
Time Type of meeting Location
6:30 p.m.
Economic Development Authority work session to discuss
potential sale of 5751 West Broadway to adjacent
property owner.
Conference Room A
6:50 p.m.
City Council work session to discuss:
• Constituent issues update.
• City manager monthly update.
• New business.
• Announcements.
Conference Room A
7 p.m. City Council meeting Council Chambers
Auxiliary aids are available upon request to individuals with disabilities by calling the City Clerk at
(763) 531-1145 at least 96 hours in advance. TTY users may call Minnesota Relay at 711 or 1-800-627-3529.
AGENDA ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF CRYSTAL WORK SESSION TUESDAY, MAY 15, 2018 6:30 P.M. CRYSTAL CITY HALL CONFERENCE ROOM A 1. Call to order * 2. Roll call * 3. Discuss proposed sale of 5751 West Broadway for combination with 5747 West Broadway 4. Adjournment * *Items for which no materials are included in the packet
PAGE 1 OF 4
_____________________________________________________________________ FROM: John Sutter, Community Development Director _____________________________________________________________________ DATE: May 10, 2018 TO: Anne Norris, City Manager (for May 15 EDA meeting) SUBJECT: Discuss proposed sale of parking lot parcel at 5751 West Broadway for combination with office building parcel at 5747 West Broadway BACKGROUND Two adjacent parcels on West Broadway, 5751 (parking lot) and 5747 (office building), were owned by the same party prior to 2011. 5751 is encumbered by a parking lot easement in favor of 5747. This means whoever owns 5747 has the right to have a parking lot on 5751 regardless of underlying ownership of 5751. When Kentucky Avenue was reconstructed in 2011, 5751 was assessed in the normal manner but those special assessments were cancelled by tax forfeiture. At this time the balance of cancelled specials is $23,178 comprised of the original assessment ($16,906) plus interest through 2018 ($6,272). As with any tax forfeited property, the city may re-assess cancelled specials after the property returns to private ownership. The former owner stopped paying the mortgage on 5747 and the taxes on 5751. So: 5747 was foreclosed and title passed to the lender in 2011. (It was not tax forfeited because the foreclosing lender paid the property taxes.) 5751 was tax forfeited and title passed to the state in 2014. (It was not foreclosed because the mortgage only encumbered the 5747 parcel.) In 2012 FTK Properties purchased the office building at 5747 from the foreclosing lender. In accordance with the easement on 5751, the office tenants have been using the parking lot. The parking lot easement makes 5751 essentially useless to anyone other than the owner of 5747. In 2015 the city completed a study of stormwater problems and potential improvements in the north part of the city where the system frequently surcharges during heavy rain events. One potential improvement would be an underground stormwater detention and infiltration facility under the parking lot at 5751.
EDA STAFF REPORT 5751 West Broadway (parking lot for 5747 West Broadway) Bass Lake Road Streetscape
PAGE 2 OF 4
In fall 2016 Hennepin County determined that the market value of 5751 is $100 and the EDA purchased it for that price in 2017. The purpose of the acquisition was to provide the city with the option of constructing a stormwater infiltration facility under the parking lot at some undetermined point in the future. CURRENT STATUS FTK Properties has expressed a desire to clean up the relationship between 5747 and 5751 by purchasing 5751, and then replatting it and 5747 into a single lot. FTK Properties has said they are reluctant to proceed with purchasing and replatting the property unless the potential re-assessment is eliminated or at least substantially reduced, and to that end has agreed to pay $5,000 towards the cancelled specials at the closing for 5751. FTK has said they are not willing to pay more. FTK Properties has a pending sale of 5747 to a religious institution. FTK’s proposed purchase of 5751 and combination with 5747 would be included as part of that deal. Staff expects to receive the buyer’s CUP application by 4:30 p.m. on May 15 and will have more detail to report during the May 15 work session. PROPOSED SEQUENCE 1. (June 5) EDA grants the city an easement for an underground stormwater treatment facility at 5751 West Broadway 2. (June 5) EDA holds public hearing on the sale of 5751 to FTK Properties 3. (mid June) EDA closes on the sale of 5751 West Broadway to FTK Properties: Sale is subject to the stormwater easement and lot combination requirement Stormwater easement runs with the land in perpetuity unless vacated by city Lot combination must be completed within one year FTK pays the EDA $100 plus all EDA legal & transaction costs FTK also pays $5,000 towards cancelled pre-forfeiture specials EDA pays remaining $18,178 for remainder of cancelled pre-forfeiture specials (the city could make an interfund transfer back to the EDA if desired) 4. (late June) FTK sells 5747 and 5751 West Broadway to [religious institution TBD] 5. (by June 2019) FTK or its successor in ownership combines 5747 and 5751 into a single lot retaining the city’s stormwater easement over the 5751 portion 6. At some future date the city would have the option of installing a stormwater facility under the parking lot: The work would be coordinated with the property owner and office building tenants, ideally when the parking lot is in need of repair or resurfacing anyway
PAGE 3 OF 4
The city’s decision to proceed with constructing the facility would depend on the city’s desire and financial capacity to do so (it may never happen) If redevelopment of the area makes the stormwater facility unnecessary or inadvisable, the city has the option of relinquishing its easement CONSIDERATIONS Reasons to proceed: օ City retains right to install and maintain a stormwater treatment facility under the parking lot at 5751 - EDA fund balance reduced by $18,178 (but could be mitigated with an interfund transfer back to the EDA) + City receives $5,000 from private party who otherwise has no obligation to pay anything towards the street assessment for 5751 + Long-term ownership will be cleared up so the office building and its parking are on a single platted lot and cannot once again go their separate ways What if we don’t proceed? օ EDA continues to own the property at 5751 West Broadway օ Office building continues to own, maintain and use the parking lot on 5751 օ EDA could grant stormwater easement to city whenever needed - Street fund would not receive the $5,000 for cancelled specials on 5751 + EDA retains $18,178 in its fund balance In summary, the main reasons to proceed are (1) to get the two parcels consolidated into a single lot and (2) to get the city $5,000 it otherwise wouldn’t receive. REQUESTED EDA DISCUSSION Staff requests discussion of this proposal so we can put it on the June 5 meeting agenda for action.
PAGE 4 OF 4
4141 Douglas Drive North • Crystal, Minnesota 55422-1696
Tel: (763) 531-1000 • Fax: (763) 531-1188 • www.crystalmn.gov
Posted: May 11, 2018
City Council
Work Session Agenda
May 15, 2018
6:50 p.m.
Conference Room A
Pursuant to due call and notice given in the manner prescribed by Section 3.01 of the City Charter,
the work session of the Crystal City Council was held at ______ p.m. on May 15, 2018 in Conference
Room A, 4141 Douglas Dr. N., Crystal, Minnesota.
I. Attendance
Council Members
____ Dahl
____ Deshler
____ Kolb
____ LaRoche
____ Parsons
____ Adams
____ Budziszewski
Staff
____ Norris
____ Therres
____ Gilchrist
____ Revering
____ Sutter
____ Serres
II. Agenda
The purpose of the work session is to discuss the following agenda items:
1. Constituent issues update.
2. City manager monthly update.
3. New business.*
4. Announcements.*
* Denotes no supporting information included in the packet.
III. Adjournment
The work session adjourned at ______ p.m.
Auxiliary aids are available upon request to individuals with disabilities by calling the City Clerk at (763) 531-
1145 at least 96 hours in advance. TTY users may call Minnesota Relay at 711 or 1-800-627-3529.
4141 Douglas Drive North • Crystal, Minnesota 55422-1696
Tel: (763) 531-1000 • Fax: (763) 531-1188 • www.crystalmn.gov
CITY MANAGER WORK PLAN
MONTHLY CHECK IN – MAY 2018
Objectives:
- Strategic leadership for achievement of Council goals
o Thriving Business Climate
City Code update continues
2018 EDA project – Bass Lake Road streetscape improvement
bid awarded to Pember Construction; construction underway
Updated fire suppression system financial assistance program
Open To Business assistance available
o Create Strong Neighborhoods
UDC amended to permit ADU’s
Disorderly properties ordinance – 2nd reading 5/15/18
Code enforcement – on-going
Implementation of Master Parks System Plan – Welcome Park
improvements – bids to be received 5/10
o Welcome Avenue closed between 46th & 47th 4/30/18
Home improvement loans/rebates available through CEE
o Fiscally sound and stable policies and procedures – see Financial
Management below
- Financial Management
o Long term financial planning:
2019-2020 budget preview 5/1/18
Budget work underway
o Updated financial policies in progress
o Surplus property feasibility study underway
o Space needs study – PD and City Hall - underway
- Service delivery
o Monthly check in with Council
o Constituent Issues – prompt response and resolution – on-going
o Closed constituent issues – monthly report
- Media Relations
o May work session – discuss Public Safety and critical incidents – how
information is shared, what information is shared
o Review and update media protocol – 2nd quarter
o Website transition – June debut
4141 Douglas Drive North • Crystal, Minnesota 55422-1696
Tel: (763) 531-1000 • Fax: (763) 531-1188 • www.crystalmn.gov
City Council Meeting Agenda
May 15, 2018
7 p.m.
Council Chambers
The city manager’s comments are bolded.
1. Call to Order, Roll Call and Pledge of Allegiance.
2. Approval of Agenda
The Council will consider approval of the agenda.
3. Appearances
3.1 Chief Revering will recognize Police Explorers for their accomplishments at the 2018 State
Explorer Conference.*
4. Consent Agenda
The Council will consider the following items, which are routine and non-controversial in nature, in a
single motion:
4.1 Approval of the minutes from the following meetings:
a. The regular City Council meeting on May 1, 2018.
b. The regular City Council work sessions on May 1, 2018.
c. The regular City Council work session on May 10, 2018.
4.2 Approval of the list of license applications submitted by the city clerk to the City Council, a list
that is on file in the office of the city clerk.
4.3 Approval of a resolution accepting the following donations:
a. $714.79 from a fundraising event at Cub Foods on March 24, 2018 for Crystal Police
Explorers and Reserves.
b. $1,500 from Laurie Slama for a bullet proof vest for Crystal K-9 Unit.
c. $500 from Westphal American Legion Post 251 for Crystal Airport Open House.
4.4 Approval of a special permit to serve beer and wine at Bassett Creek Park for up to
100 guests to attend a baby shower on July 1, 2018, from 5-10 p.m., submitted by Sam Gony.
4.5 Approval of a resolution of participation in the 2018 state performance measures.
Crystal City Council Meeting Agenda
May 15, 2018
Page 2 of 4
5. Open Forum
(The City Council appreciates hearing from citizens about items of concern and desires to set aside
time during each meeting for Open Forum. To provide ample opportunity for all, speaking time is
limited to three minutes and topic discussion is limited to ten minutes. The Mayor may, as presiding
officer, extend the total time allowed for a topic. By rule, no action may be taken on any item brought
before the Council during Open Forum. The Council may place items discussed during Open Forum
onto subsequent council meeting agendas.)
6. Regular Agenda
6.1 The Council will consider approval of disbursements over $25,000 submitted by the finance
department to the city council, a list that is on file in the office of the finance department.
Recommend approval of disbursements over $25,000.
6.2 The Council will receive a presentation and consider acceptance of the Comprehensive
Annual Financial Report presented by BerganKDV, Ltd.
Matt Mayer of BerganKDV and Finance Director Jean McGann will be at the meeting to
present the 2017 financial report. Recommend acceptance of the report.
6.3 The Council will consider a resolution approving a Police Equipment Revolving Fund (PERF)
expenditure for purchase of a Firearms Training Simulator (FATS).
The 2018 Police Capital budget includes $45,000 for the purchase of a Firearms Training
Simulator for police training. Recommend approval of this purchase.
6.4 The Council will consider a resolution awarding a contract for Welcome Park construction
project.
At its April 17 meeting the Council authorized advertising for bids for the Welcome Park
improvements. Five bids were received; recommend approval of awarding the contract to
the low bidder, Rachel Construction.
6.5 The Council will consider a resolution awarding a contract for a new message board at Crystal
Community Center.
The 2018 capital budget includes $40,000 for replacement of a marquee sign at the
Community Center. There are currently two monument signs at the Community Center –
one message board that no longer is functional and one name and address sign. We are
recommending replacing both existing signs with one message board at the Community
Center.
6.6 The Council will consider a resolution awarding a contract for forestry services.
Crystal City Council Meeting Agenda
May 15, 2018
Page 3 of 4
Bids were received for forestry services (tree trimming and removal, etc.) Recommend
approval of awarding the contract for forestry services to Nick’s Tree Service.
6.7 The Council will consider first reading of an ordinance amending Chapter 8 of the City Code.
After several discussions with the City Council, the proposed ordinance updating Chapter 8
includes moving the park provisions from Chapter 8 to a new Chapter 21 and adds several
new subsections to Chapter 12 regarding on-sale liquor at the Community Center and
community events. Recommend approval of the first reading of the ordinance making
these changes.
6.8 The Council will consider the second reading of an ordinance amending Chapters IV and VI of
the City Code relating to disorderly properties and a resolution for summary publication.
The Council has had multiple discussions regarding amending the City Code to address all
disorderly properties. At its May 1 meeting, the Council approved the first reading of the
ordinance amending Chapters IV and VI of the City Code. Recommend approval of the
second reading of this ordinance and the resolution for summary publication.
7. Announcements
a. The Crystal Business Association meets on Wednesday, May 16, at 8:30 a.m. at the Becker
Park Pavilion.
b. The Crystal Crime Prevention Board is hosting its annual Jail and Bail Fundraiser on
Wednesday, May 16, 11 a.m. – 1 p.m. at the Neighborhood Outreach Office.
c. The Crystal Fund Plant Sale is on Saturday, May 19, 9 a.m. – 2 p.m. at the Crystal Community
Center.
d. A community workshop about Town Center zoning in the Bass Lake Road station area will be
held on Monday, May 21 from 6:30-8:00 p.m. at the Becker Park Pavilion.
e. Two Beyond the Yellow Ribbon Memorial Day ceremonies will be Monday, May 28: one at 10
a.m. at the Chester Bird American Legion in Golden Valley; and the other at 1:00 p.m. at Glen
Haven Memorial Gardens in Crystal.
f. The next City Council meeting is on Tuesday, June 5, at 7 p.m. in the Council Chambers at City
Hall.
g. The Crystal Airport Open House is Sunday, June 17, 8 a.m. – 4 p.m.
h. Girl and Boy Scout troops are invited to lead the pledge at City Council meetings. Troops who
are interested may contact city staff for information.
Crystal City Council Meeting Agenda
May 15, 2018
Page 4 of 4
i. City Council meetings and work sessions are open to the public. Current and previous
meetings are available for viewing and listening at www.crystalmn.gov.
8. Adjournment
9. May 15, 2018 Meeting Schedule
Time Type of meeting Location
6:30 p.m.
Economic Development Authority (EDA) work session:
• Discuss potential sale of 5751 West Broadway to
the adjacent owner.
Conference Room A
6:50 p.m.
City Council work session to discuss:
• Constituent issues update.
• City manager monthly update.
• New business.*
• Announcements.*
Conference Room A
7 p.m. City Council meeting Council Chambers
* Denotes no supporting information included in the packet.
Have a great weekend. See you at Tuesday’s meeting.
Crystal City Council meeting minutes May 1, 2018
Page 1 of 4
1.Call to Order
Pursuant to due call and notice thereof, the regular meeting of the Crystal City Council was held on
May 1, 2018 at 7:01 p.m. in the Council Chambers at City Hall, 4141 Douglas Dr. N. in Crystal,
Minnesota. Mayor Adams called the meeting to order.
Roll Call
Mayor Adams asked the city clerk to call the roll for elected officials. Upon roll call, the following
attendance was recorded:
Council members present: Budziszewski, Dahl, Deshler, Kolb, LaRoche, Parsons and Adams.
City staff present: City Manager A. Norris, Assistant City Manager/Human Resources Manager
K. Therres, City Attorney T. Gilchrist, Community Development Director J. Sutter, Public Works
Director/City Engineer M. Ray, Recreation Director J. Elholm, Police Chief S. Revering and City Clerk
C. Serres.
Pledge of Allegiance
Mayor Adams led the Council and audience in the Pledge of Allegiance.
2.Approval of Agenda
The Council considered approval of the agenda.
Moved by Council Member LaRoche and seconded by Council Member Parsons to approve the
agenda.
Motion carried.
3.Proclamations
3.1 Mayor Adams read a proclamation recognizing May 13 through May 19, 2018 as Police Week
and May 15, 2018 as Peace Officer Memorial Day.
3.2 Mayor Adams read a proclamation recognizing May 20 through May 26, 2018 as Public
Works Week.
4.Appearance
4.1 The Council recognized Crime Prevention Board President Pat Bedell for her years of service
as President of the Board.
Police Chief Stephanie Revering and Pat Bedell addressed the Council.
5.Consent Agenda
The Council considered the following items, which are routine and non-controversial in nature, in a
single motion:
5.1 Approval of the minutes from the following meetings:
a.The regular City Council meeting on April 17, 2018.
b.The regular City Council work sessions on April 17, 2018.
c.The joint City Council and Planning Commission work session on April 19, 2018.
4.1(a)
Crystal City Council meeting minutes May 1, 2018
Page 2 of 4
5.2 Approval of the list of license applications submitted by the city clerk to the City Council, a
list that is on file in the office of the city clerk.
5.3 Approval of Resolution No. 2018-58, accepting the following donations:
a. $750 from Minneapolis Elks Lodge #44 for Crystal Airport Open House.
b. $500 from Rudolph Priebe Post 172 for Crystal Airport Open House.
5.4 Approval of a special permit to serve beer and wine at Becker Park for up to 50 guests to
attend a graduation party on May 12, 2018, from 4-10 p.m., submitted by Judith Morales
Tellez.
5.5 Approval of a Master Funding Agreement for city work being completed as part of the Blue
Line Extension project.
Moved by Council Member Deshler and seconded by Council Member Dahl to approve the consent
agenda.
Motion carried.
6. Open Forum
The following persons addressed the Council:
• Burt Orred, 6700 60th Ave. N., ordinance changes from a previous meeting.
• Mary Soukup, 4736 Xenia Ave. N., regarding traffic concerns on Xenia Ave. N.
• Dan Bjorback, 4743 Xenia Ave. N., regarding traffic concerns on Xenia Ave. N.
7. Regular Agenda
7.1 The Council considered approval of disbursements over $25,000 submitted by the finance
department to the City Council, a list that is on file in the office of the finance department.
Moved by Council Member LaRoche and seconded by Council Member Deshler to approve
the list of disbursements over $25,000.
Voting aye: Budziszewski, Dahl, Deshler, Kolb, LaRoche, Parsons and Adams.
Motion carried.
7.2 The Council considered second reading and adoption of an ordinance amending Chapters V
(Unified Development Code) and VII of the City Code and a resolution for summary
publication.
Community Development Director John Sutter addressed the Council.
Moved by Council Member Kolb and seconded by Council Member LaRoche to adopt the
following ordinance:
ORDINANCE NO. 2018 – 01
AN ORDINANCE AMENDING CHAPTERS V AND VII OF THE CRYSTAL CITY CODE
RELATED TO THE UNIFORM DEVELOPMENT CODE AND PUBLIC UTILITIES
4.1(a)
Crystal City Council meeting minutes May 1, 2018
Page 3 of 4
And further, that this is the second and final reading.
By roll call and voting aye: Kolb, LaRoche, Parsons, Adams, Dahl and Deshler.
Voting nay: Budziszewski.
Motion carried.
Moved by Council Member Parsons and seconded by Council Member Dahl to adopt the
following resolution, the reading of which was dispensed with by unanimous consent:
RESOLUTION NO. 2018 – 59
RESOLUTION APPROVING SUMMARY LANGUAGE
FOR PUBLICATION OF ORDINANCE NO. 2018-01
By roll call and voting aye: LaRoche, Parsons, Adams, Dahl, Deshler and Kolb.
Voting nay: Budziszewski.
Motion carried, resolution declared adopted.
7.3 The Council considered the first reading of an ordinance amending Chapters IV and VI of the
City Code, relating to disorderly properties.
City Attorney Troy Gilchrist addressed the Council.
Moved by Council Member Deshler and seconded by Council Member Parsons to adopt the
following ordinance:
ORDINANCE NO. 2018 – 02
AN ORDINANCE AMENDING CHAPTERS IV AND VI
OF THE CRYSTAL CITY CODE RELATED TO DISORDERLY PROPERTY
And further, that the second and final reading will be held on May 15, 2018.
Voting aye: Budziszewski, Dahl, Deshler, Kolb, LaRoche, Parsons and Adams.
Motion carried.
7.4 The Council considered a resolution awarding the contract for the painting of the waterslide
support structure.
Public Works Director/City Engineer Mark Ray addressed the Council.
Moved by Council Member Parsons and seconded by Council Member LaRoche to adopt the
following resolution, the reading of which was dispensed with by unanimous consent:
RESOLUTION NO. 2018 – 60
AWARDING THE CONTRACT FOR THE PAINTING OF
THE WATERSLIDE SUPPORT STRUCTURE
4.1(a)
Crystal City Council meeting minutes May 1, 2018
Page 4 of 4
Voting aye: Budziszewski, Dahl, Deshler, Kolb, LaRoche, Parsons and Adams.
Motion carried, resolution declared adopted.
8. Announcements
The Council made several announcements about upcoming events.
9. Adjournment
Moved by Council Member LaRoche and seconded by Council Member Parsons to adjourn the
meeting.
Motion carried.
The meeting adjourned at 7:58 p.m.
__________________________________ Jim Adams, Mayor
ATTEST: _________________________________________ Chrissy Serres, City Clerk
4.1(a)
Crystal City Council first work session minutes May 1, 2018
Pursuant to due call and notice given in the manner prescribed by Section 3.01 of the City
Charter, the first work session of the Crystal City Council was held at 6:18 p.m. on May 1, 2018
in Conference Room A, 4141 Douglas Dr. N., Crystal, Minnesota. Mayor Adams called the
meeting to order.
I.Attendance
The city clerk recorded the attendance for City Council members and staff:
Council members present: Budziszewski, Dahl, Deshler, Kolb, LaRoche, Parsons and Adams.
City staff present: City Manager A. Norris, Assistant City Manager/Human Resources
Manager K. Therres, City Attorney T. Gilchrist, Finance Director J. McGann, Recreation
Director J. Elholm, Police Chief S. Revering and City Clerk C. Serres.
II.Agenda
The Council and staff discussed the following agenda items:
1. 2019-20 Budget Preview.
2.Crystal Ball recap/report.
III.Adjournment
The work session adjourned at 6:59 p.m.
________________________________
Jim Adams, Mayor
ATTEST:
Chrissy Serres, City Clerk
4.1(b)
Crystal City Council second work session minutes May 1, 2018
Pursuant to due call and notice given in the manner prescribed by Section 3.01 of the City
Charter, the second work session of the Crystal City Council was held at 8:08 p.m. on May 1,
2018 in Conference Room A, 4141 Douglas Dr. N., Crystal, Minnesota. Mayor Adams called the
meeting to order.
I.Attendance
The city clerk recorded the attendance for City Council members and staff:
Council members present: Budziszewski, Dahl, Deshler, Kolb, LaRoche, Parsons and Adams.
City staff present: City Manager A. Norris, Assistant City Manager/Human Resources
Manager K. Therres, City Attorney T. Gilchrist, Community Development Director J. Sutter,
Public Works Director/City Engineer M. Ray, Recreation Director J. Elholm, Police Chief
S.Revering and City Clerk C. Serres.
II.Agenda
The Council and staff discussed the following agenda items:
1.Chapter 8 of City Code.
2.Chapters 10-11 of City Code.
3. 36th and Welcome pedestrian crossing study.
4.Constituent issues update.
5.New business.
6.Announcements.
III.Adjournment
The work session adjourned at 9:31 p.m.
________________________________
Jim Adams, Mayor
ATTEST:
Chrissy Serres, City Clerk
4.1(b)
Crystal City Council work session minutes May 10, 2018
Pursuant to due call and notice given in the manner prescribed by Section 3.01 of the City
Charter, the work session of the Crystal City Council was held at 6:31 p.m. on May 10, 2018 in
Conference Room A and the Council Chambers, 4141 Douglas Dr. N., Crystal, Minnesota. Mayor
Adams called the meeting to order.
I.Attendance
The city clerk recorded the attendance for City Council members and staff:
Council members present: Budziszewski, Dahl, LaRoche, Parsons and Adams.Absent: Deshler and Kolb.
City staff present: City Manager A. Norris, Assistant City Manager/Human Resources
Manager K. Therres, Police Chief S. Revering, Lieutenant D. Hacker, Communications
Coordinator M. Peterson and City Clerk C. Serres.
Others present: Andy Skoogman, Executive Director of the Minnesota Chiefs of Police
Association.
II.Agenda
The Council and staff discussed the following Police Department updates:
Media Relations (Conference Room A)
Update on Body Camera Pilot Program (Conference Room A)
2017 Annual Report (Conference Room A)
Annual Security Training (Council Chambers)
III.Adjournment
The work session adjourned at 8:57 p.m.
________________________________
Jim Adams, Mayor
ATTEST:
Chrissy Serres, City Clerk
4.1(c)
Page 1 of 1
City of Crystal Council Meeting
May 15, 2018
Applications for City License
Rental – New
3603 Douglas Dr N – Rafael Sanchez Cortes (Conditional)
6600 50th Ave N – MHB Enterprises LLC (Conditional)
Rental – Renewal
5315 Angeline Ave N – LC Single Homes LLC (Conditional)
4306 Brunswick Ave N – Pro Operam Sub IV LLC
3649 Colorado Ave N – Ross and Nicole Hunter
5734 Colorado Ave N – Kate Werner
5319 Corvallis Ave N – Donald and Kimberly Horton
3117 Douglas Dr N – H & D Choi
3821 Douglas Dr N – Clayton and Tammy Duggan
4559-4563 Douglas Dr N – Donald Brasch
6115 Douglas Dr N – Kenneth & Ruth Kutzler (Conditional)
3109 Hampshire Ave N – Rent it LLC (Conditional)
4230 Hampshire Ave N – William L Smith
5407 Hampshire Ave N – Chris and Angela Chaffee
4057 Idaho Ave N – IH3 Property Minnesota LP
4812-4814 Idaho Ave N – Equitron Holdings (Conditional)
5331 Jersey Ave N – Jaspermax LLC (Conditional)
3436 Major Ave N – Judy DuPaul (Conditional)
5857 Maryland Ave N – Daniel and Jalana Moe (Conditional)
5621 Perry Ave N – Lance and Juliet Nordin
5525-5527 Quail Ave N – Lloyd and Marilyn Olson (Conditional)
7400 Shirley Pl N – Bachaus Invstt Props LLC
5229 Unity Ct N – RTO Investments LLC (Conditional)
5232 Welcome Ave N – Crystal Clear Investments
4518 Yates Ave N – Stephen and Janet Olson
6820-6824 44th Ave N – Steve Hinrichs (Conditional)
6800 45th Ave N – William L Smith
5324 47th Ave N – William L Smith
7123 54th Ave N – Alan Trout
Tobacco
Trilogy LLC 2712 Douglas Dr Crystal, MN 55422
Tree Trimmer
Jeff Hoheisel Professional Tree Service Inc 34214 Hwy 27 Hillman, MN 56338
Chip’s Trees 10525 45th Ave N Plymouth, MN 55442
Arbortech Stump & Tree Removal 6332 Rhode Island Ave N Brooklyn Park, MN 55428
4.2
CITY OF CRYSTAL
RESOLUTION NO. 2018 – 61
RESOLUTION ACCEPTING DONATIONS FROM
LAURIE SLAMA, WESTPHAL AMERICAN LEGION POST 251 AND
VARIOUS INDIVIDUALS
WHEREAS, Minnesota Statute §465.03 requires that all gifts and donations of real or personal
property be accepted only with the adoption of a resolution; and
WHEREAS, said donations must be accepted by a resolution adopted by the City Council.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Crystal to accept the
following donations:
Donor Purpose Amount
Various individuals Crystal Explorers and Reserves fundraiser $714.79
Laurie Slama Crystal K-9 Unit bullet proof vest $1,500
Westphal American Legion Crystal Airport Open House $500
Post 251
AND, BE IT FURTHER RESOLVED that the Crystal City Council sincerely thanks the above-
named for their generous donations.
Dated: May 15, 2018
By: __________________________
Jim Adams, Mayor
ATTEST:
__________________________
Chrissy Serres, City Clerk
4.3
MEMORANDUM
DATE: May 8, 2018
TO: Crystal City Council
City Manager Anne Norris
FROM: Administrative Services Coordinator Trudy Tassoni
SUBJECT: Application for Special Permit for Wine/Beer at Becker Park
Sam Gony has applied for a special permit to serve wine/beer at Bassett Creek Park on
Sunday, July 1, 2018, from 5-10 p.m. for up to 100 guests to attend a baby shower. He
reserved Bassett Creek north and south picnic shelters through the Crystal Recreation
Department, under Park Permit Number 2872.
Council Action Requested
As part of the Consent Agenda on May 15, 2018, approve the Special Permit for Wine/Beer
submitted by Sam Gony.
His application is available for review in the city clerk’s office.
COUNCIL STAFF REPORT
Consent Agenda: Special Permit for Wine/Beer
Council Meeting 05/15/2018
4.4
4.5
4.5
G:\Brenda\Accts Payable\Check over $25,000\Checks over $25,000 Memo.xls
DATE:May 9, 2018
TO:Anne Norris, City Manager
City of Crystal City Council
FROM:Jean McGann, Acting Finance Director
RE:Expenditures over $25,000
Payee Amount
Golden Valley JWC March water costs $130,159.64
HealthPartners Inc.May health insurance premiums $99,689.00
IRS - EFTPS Federal & FICA withholding taxes for 5/4/18 pay date $53,003.56
LOGIS February & March support and services $82,762.39
PERA Employee and city required contributions for 5/4/2018 pay date $51,929.63
RDO Equipment Co Inc New 2018 John Deere 624K Loader w/trade-in 2004 JD 624J Loader $172,529.00
$590,073.22
Description
6.1
City of Crystal
Hennepin County, Minnesota
Communications Letter
December 31, 2017
6.2
City of Crystal
Table of Contents
Report on Matters Identified as a Result of
the Audit of the Financial Statements 1
Significant Deficiency 3
Required Communication 4
Financial Analysis 7
Emerging Issues 18
6.2
1
BerganKDV, Ltd. bergankdv.com
Report on Matters Identified as a Result of
the Audit of the Financial Statements
Honorable Mayor and Members
of the City Council
City of Crystal
Crystal, Minnesota
In planning and performing our audit of the basic financial statements of the City of Crystal,
Minnesota, as of and for the year ended December 31, 2017, in accordance with auditing
standards generally accepted in the United States of America, we considered the City's
internal control over financial reporting (internal control) as a basis for designing audit
procedures that are appropriate in the circumstances for the purpose of expressing our
opinions on the financial statements, but not for the purpose of expressing an opinion on the
effectiveness of the City's internal control. Accordingly, we do not express an opinion on the
effectiveness of the City's internal control.
Our consideration of internal control was for the limited purpose described in the preceding
paragraph and was not designed to identify all deficiencies in internal control that might be
material weaknesses or significant deficiencies and, therefore, material weaknesses or
significant deficiencies may exist that were not identified. In addition, because of inherent
limitations in internal control, including the possibility of management override of controls,
misstatements due to error, or fraud may occur and not be detected by such controls.
However, as discussed below, we identified a certain deficiency in internal control that we
consider to be a significant deficiency.
A deficiency in internal control exists when the design or operation of a control does not
allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, misstatements on a timely basis. A material
weakness is a deficiency, or a combination of deficiencies in internal control, such that there
is a reasonable possibility that a material misstatement of the City's financial statements will
not be prevented, or detected and corrected, on a timely basis. We did not identify any
deficiencies in internal control that we consider to be material weaknesses.
A significant deficiency is a deficiency, or a combination of deficiencies, in internal control
that is less severe than a material weakness, yet important enough to merit attention by those
charged with governance. The significant deficiency identified is stated within this letter.
6.2
2
The accompanying memorandum also includes financial analysis and recommendations for
improvement of accounting procedures and internal control measures that came to our
attention as a result of our audit of the financial statements of the City, for the year ended
December 31, 2017. The matters discussed herein were considered by us during our audit
and they do not modify the opinion expressed in our Independent Auditor's Report dated
May 2, 2018, on such statements.
This communication is intended solely for the information and use of the management, the
City Council, others within the City and state oversight agencies and is not intended to be,
and should not be, used by anyone other than these specified parties.
Minneapolis, Minnesota
May 2, 2018
6.2
3
City of Crystal
Significant Deficiency
LACK OF SEGREGATION OF ACCOUNTING DUTIES
The City had a lack of segregation of accounting duties due to a limited number of office employees .
Management is aware of this condition and has taken certain steps to compensate for the lack of
segregation. However, due to the number of staff needed to properly segregate all of the accounting
duties, the cost of obtaining desirable segregation of accounting duties can often exceed benefits which
could be derived. Management has determined a complete segregation of accounting duties is
impractical to correct.
6.2
City of Crystal
Required Communication
4
We have audited the basic financial statements of the City for the year ended December 31, 2017, and
have issued our report May 2, 2018. Professional standards require that we provide you with the
following information related to our audit.
OUR RESPONSIBILITY UNDER AUDITING STANDARDS GENERALLY ACCEPTED IN
THE UNITED STATES OF AMERICA
As stated in our engagement letter, our responsibility, as described by professional standards, is to
express opinions about whether the financial statements prepared by management with your oversight
are fairly presented, in all material respects, in conformity with accounting principles generally accepted
in the United States of America. Our audit of the financial statements does not relieve you or
management of your responsibilities.
As part of our audit, we considered the internal control of the City. Such considerations were solely for
the purpose of determining our audit procedures and not to provide any assurance concerning internal
control.
As part of obtaining reasonable assurance about whether the financial statements are free of material
misstatement, we performed tests of the City's compliance with certain provisions of laws, regulations,
contracts, and grant agreements. However, the objective of our tests was not to provide an opinion on
compliance with such provisions.
Our responsibility for the supplementary information accompanying the financial statements, as
described by professional standards, is to evaluate the presentation of the supplementary information in
relation to the financial statements as a whole and to report on whether the supplementary information is
fairly stated, in all material respects, in relation to the financial statements taken as a whole.
PLANNED SCOPE AND TIMING OF THE AUDIT
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements, therefore, our audit involved judgment about the number of transactions to be
examined and the areas to be tested.
Our audit included obtaining an understanding of the City and its environment, including internal
control, sufficient to assess the risks of material misstatement of the financial statements and to design
the nature, timing, and extent of further audit procedures. Material misstatements may result from
(1) errors, (2) fraudulent financial reporting, (3) misappropriation of assets, or (4) violations of laws or
governmental regulations that are attributable to the City or to acts by management or employees acting
on behalf of the City.
QUALITATIVE ASPECTS OF ACCOUNTING PRACTICES
Management is responsible for the selection and use of appropriate accounting policies. The significant
accounting policies used by the City are described in the notes to financial statements. No new
accounting policies were adopted and the application of existing policies was not changed during the
year ended December 31, 2017. We noted no transactions entered into by the City during the year for
which there is a lack of authoritative guidance or consensus. All significant transactions have been
recognized in the proper period.
6.2
City of Crystal
Required Communication
5
QUALITATIVE ASPECTS OF ACCOUNTING PRACTICES (CONTINUED)
Accounting estimates are an integral part of the financial statements prepared by management and are
based on management's knowledge and experience about past and current events and assumptions about
future events. Certain accounting estimates are particularly sensitive because of their significance to the
financial statements and because of the possibility that future events affecting them may differ
significantly from those expected. The most sensitive estimates affecting the financial statements were:
Depreciation – The City is currently depreciating its capital assets over their estimated useful lives,
as determined by management, using the straight-line method.
Expense/Expenditure Allocation – Certain expenses/expenditures are allocated to functions based on
an estimate of the benefit to that particular function. Examples are salaries, benefits, administrative
charges, and supplies.
Net Other Post Employment Benefits (OPEB) Obligation – This liability is based on an actuarial
study using estimates of future obligations of the City for post employment benefits.
Net Pension Liability, Deferred Outflows of Resources Related to Pensions and Deferred Inflows of
Resources Related to Pensions – These balances are based on allocation by the pension plans using
estimates based on contributions.
We evaluated the key factors and assumptions used to develop the accounting estimates in determining
that they are reasonable in relation to the financial statements taken as a whole.
The financial statements disclosures are neutral, consistent, and clear.
DIFFICULTIES ENCOUNTERED IN PERFORMING THE AUDIT
We encountered no difficulties in dealing with management in performing and completing our audit.
CORRECTED AND UNCORRECTED MISSTATEMENTS
Professional standards require us to accumulate all known and likely misstatements identified during the
audit, other than those that are clearly trivial, and communicate them to the appropriate level of
management. Management has corrected all such misstatements.
In addition, none of the misstatements detected as a result of audit procedures and corrected by
management were material, either individually or in the aggregate, to the financial statements taken as a
whole.
6.2
City of Crystal
Required Communication
6
DISAGREEMENTS WITH MANAGEMENT
For purposes of this letter, a disagreement with management is a financial accounting, reporting, or
auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial
statements or the auditor's report. We are pleased to report that no such disagreements arose during the
course of our audit.
MANAGEMENT REPRESENTATIONS
We requested certain representations from management which were provided to us in the management
representation letter.
MANAGEMENT CONSULTATIONS WITH OTHER ACCOUNTANTS
In some cases, management may decide to consult with other accountants about auditing and accounting
matters, similar to obtaining a "second opinion" on certain situations. If a consultation involves
application of an accounting principle to the City's financial statements or a determination of the type of
auditor's opinion that may be expressed on those statements, our professional standards require the
consulting accountant to check with us to determine that the consultant has all the relevant facts. To our
knowledge, there were no such consultations with other accountants.
OTHER AUDIT FINDINGS OR ISSUES
We generally discuss a variety of matters, including the application of accounting principles and
auditing standards, with management each year prior to retention as the City's auditors. However, these
discussions occurred in the normal course of our professional relationship and our responses were not a
condition to our retention.
OTHER MATTERS
We applied certain limited procedures to the RSI that supplements the basic financial statements. Our
procedures consisted of inquiries of management regarding the methods of preparing the information
and comparing the information for consistency with management's responses to our inquiries, the basic
financial statements, and other knowledge we obtained during our audit of the basic financial statements.
We did not audit the RSI and do not express an opinion or provide any assurance on the RSI.
With respect to the supplementary information accompanying the financial statements, we made certain
inquiries of management and evaluated the form, content and methods of preparing the information to
determine that the information complies with accounting principles generally accepted in United States
of America, the method of preparing it has not changed from the prior period and the information is
appropriate and complete in relation to our audit of the financial statements. We compared and
reconciled the supplementary information to the underlying accounting records used to prepare the
financial statements or to the financial statements themselves.
6.2
City of Crystal
Financial Analysis
7
The following pages provide graphic representation of select data pertaining to the financial position and
operations of the City for the past five years. Our analysis of each graph is presented to provide a basis
for discussion.
GENERAL FUND
At December 31, 2017, the General Fund balance was $6,892,456, a decrease of 2.3%, or $161,319,
from the 2016 balance. The components of fund balance for the General Fund and fund balance as a
percent of subsequent years' budget are depicted in the graphs below and on the following page.
$6,862,599
$6,594,097 $6,382,810 $6,220,496 $6,119,325
$840,514
$801,697
$782,627 $817,760 $753,962
$27,488 $15,519 $19,169
$-
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
2013 2014 2015 2016 2017
Unassigned Committed for Compensated Absences Nonspendable
6.2
City of Crystal
Financial Analysis
8
GENERAL FUND (CONTINUED)
The City adopted a budget for 2018 which called for an increase in expenditures and other financing
uses of 6.25%, or $825,659. Fund balance at December 31, 2017, as a percentage of this budget is
shown in the chart below.
55%
52%50%
47%
44%
61%58%57%
53%
49%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
55%
60%
65%
2013 2014 2015 2016 2017
Unassigned Fund Balance Total Fund Balance
6.2
City of Crystal
Financial Analysis
9
GENERAL FUND (CONTINUED)
For the 2017 operating year, the City Council approved a balanced budget anticipating no change in
fund balance. Revenues were under budget by 0.3% and expenditures were 0.9% over budget. This
resulted in a negative variance of $161,319 from budgeted expectations.
General Fund Budget Actual Variance Percentage
Revenue
Taxes and assessments 8,783,900$ 8,768,616$ (15,284)$ -0.2%
Intergovernmental 1,973,909 2,003,243 29,334 1.5%
Licenses, permits, fines, and charges for services 1,927,933 1,869,591 (58,342) -3.0%
Other 80,200 82,355 2,155 2.7%
Total revenues 12,765,942 12,723,805 (42,137) -0.3%
Expenditures
General government 2,573,128 2,622,202 49,074 1.9%
Public safety 6,357,310 6,504,810 147,500 2.3%
Public works 1,363,907 1,285,172 (78,735) -5.8%
Parks and recreation 2,357,258 2,372,112 14,854 0.6%
Community development 559,814 543,950 (15,864) -2.8%
Total expenditures 13,211,417 13,328,246 116,829 0.9%
Excess of revenues over
(under) expenditures (445,475) (604,441) (158,966) 35.7%
Net other financing sources (uses) 445,475 443,122 - 0.0%
Change in fund balance - (161,319) (161,319) N/A
Beginning fund balance 7,053,775 7,053,775 - 0.0%
Ending fund balance 7,053,775$ 6,892,456$ (161,319)$ -2.3%
The largest components of the revenue budget variances were in licenses, permits fines, and charges for
services as licenses and permits were budgeted to increase.
Public safety expenditures were over budget by 2.3%, or $147,500 due to an increase in incidents during
the year. Public works expenditures were under budget by 5.8%, or $78,735 mainly due to budgeting for
increases in salaries and health insurance, however, salaries and benefits lower than anticipated. The
remaining expenditures by function were consistent with budgeted amounts.
6.2
City of Crystal
Financial Analysis
10
GENERAL FUND REVENUES
The chart below shows the City's revenues by source for the last five years. Total revenues of
$12,723,805 in 2017 increased from $12,131,097 in 2016. The largest increase occurred in property
taxes due to increase in the amount of property tax levied and an increase in delinquent taxes received.
2013 2014 2015 2016 2017
Other $931,314 $536,311 $501,360 $552,865 $466,858
Charges for Services 686,100 769,202 672,594 791,838 758,968
Licenses and Permits 843,741 924,967 808,695 773,479 785,451
Intergovernmental 2,019,368 1,961,163 1,991,430 2,008,525 2,003,243
Property Taxes 8,211,693 8,238,974 8,262,652 8,004,390 8,709,285
$-
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
$9,000,000
$10,000,000
$11,000,000
$12,000,000
$13,000,000
General Fund Revenues
6.2
City of Crystal
Financial Analysis
11
GENERAL FUND EXPENDITURES
The pie charts below show the breakdown of expenditures in the General Fund for the last two years.
The allocation of expenditures by function did not change significantly between 2016 and 2017.
General Government
20%
Public Safety
49%
Public Works
9%
Parks and Recreation
18%
Community
Development
4%
2017 General Fund Expenditures
General Government
20%
Public Safety
48%
Public Works
10%
Parks and Recreation
18%
Community
Development
4%
2016 General Fund Expenditures
6.2
City of Crystal
Financial Analysis
12
GENERAL FUND EXPENDITURES (CONTINUED)
General Fund expenditures increased $714,713, or 5.7%, from the prior year. Public Safety expenditures
increased $435,186 due to increases in salaries, benefits, and prior year vacancies in the police
department that were filled in 2017. Parks and Recreation increased $138,215 due to increases in
salaries in benefits. General Government increased $111,815 with most of the variance due to the City
having additional repairs and maintenance costs and increases in professional service fees.
2013 2014 2015 2016 2017
Community Development $630,825 $721,284 $736,813 $523,035 $543,950
Parks and Recreation 2,022,820 2,071,226 2,221,638 2,233,897 2,372,112
Public Works 1,151,659 1,241,293 1,251,095 1,276,590 1,285,172
Public Safety 5,617,980 5,595,971 5,744,126 6,069,624 6,504,810
General Government 2,120,666 2,188,671 2,284,547 2,510,387 2,622,202
$-
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
$9,000,000
$10,000,000
$11,000,000
$12,000,000
$13,000,000
$14,000,000
General Fund Expenditures
6.2
City of Crystal
Financial Analysis
13
WATER ENTERPRISE FUND
Activity for the City's Water Fund is shown below. Water operating revenues increased $56,843 as a
result of an increase in rates in 2017. Net non-operating revenue fell significantly with net income from
joint venture operations declining. Operating expenses decreased $76,480 from 2016 due to more repairs
in the prior year. The Water Fund ended the year with a net income of $717,863, which was a decrease
in net income from 2016 of $1,091,786.
2013 2014 2015 2016 2017
Operating revenue 2,825,253$ 2,786,814$ 3,222,273$ 3,337,980$ 3,394,823$
Operating expense 3,017,767 3,928,301 4,131,931 3,037,110 2,960,628
Operating income (loss)(192,514) (1,141,487) (909,658) 300,870 434,195
Net nonoperating revenue 158,034 215,278 1,404,862 1,508,779 283,668
Net income (34,480)$ (926,209)$ 495,204$ 1,809,649$ 717,863$
Net income as a percent of
operating revenue -1%-33%15%54%21%
State-wide average 12%8%9%10%N/A
Water Enterprise Fund Operations
6.2
City of Crystal
Financial Analysis
14
SANITARY SEWER ENTERPRISE FUND
Sewer operating revenues increased $105,262 due to an increase in rates and operating expenses
decreased $23,699 due to more repairs needed in the prior year. The Sanitary Sewer Fund's operating
income increased $70,834 from 2016.
2013 2014 2015 2016 2017
Operating revenue 1,947,194$ 2,020,673$ 2,085,601$ 2,196,601$ 2,301,863$
Operating expense 1,926,465 1,931,725 1,995,548 2,168,280 2,144,581
Operating income (loss)20,729 88,948 90,053 28,321 157,282
Net nonoperating revenue 24,934 37,735 47,603 81,044 22,917
Net income (loss)45,663$ 126,683$ 137,656$ 109,365$ 180,199$
Net income (loss) as a percent of
operating revenue 2%6%7%5%8%
State-wide average 4%9%8%9%N/A
Sanitary Sewer Enterprise Fund Operations
6.2
City of Crystal
Financial Analysis
15
STORM DRAINAGE AND STREET LIGHTS ENTERPRISE FUNDS
2013 2014 2015 2016 2017
Operating revenue 724,887$ 760,884$ 809,067$ 871,233$ 1,059,165$
Operating expense 697,159 659,972 883,284 903,342 794,169
Operating income (loss)27,728 100,912 (74,217) (32,109) 264,996
Net nonoperating revenue (44,844) 2,248 7,413 31,695 134,197
Net income (loss)(17,116)$ 103,160$ (66,804)$ (414)$ 399,193$
Net income (loss) as a percent of
operating revenue -2%14%-8%0%38%
State-wide average N/A N/A N/A N/A N/A
Storm Drainage Enterprise Fund Operations
2013 2014 2015 2016 2017
Operating revenue 169,197$ 187,630$ 186,237$ 191,382$ 195,122$
Operating expense 252,779 169,664 151,305 155,056 154,479
Operating income (loss)(83,582) 17,966 34,932 36,326 40,643
Net nonoperating revenue (expense)(55,253) 5,100 8,981 10,973 (11,465)
Net income (loss)(138,835)$ 23,066$ 43,913$ 47,299$ 29,178$
Net income (loss) as a percent of
operating revenue -82%12%24%25%15%
State-wide average N/A N/A N/A N/A N/A
Street Lights Enterprise Fund Operations
6.2
City of Crystal
Financial Analysis
16
PER CAPITA REVENUES AND EXPENDITURES
Below is a chart of the per capita trends in selected revenue and expenditure line items. In 2017, the
intergovernmental revenue per capital has remained consistent. The property taxes per capital increased
due to an increase in property tax levy. Total expenditures per capita have remained relatively consistent
in the five years presented and increased in 2017 due to an increase in capital outlay expenditures.
Current expenditures per capita has remained consistent over the past four years.
2016**2017***
Intergovernmental revenues per capita 152$ 134$ 137$
Property taxes per capita ****455 421 447
Total revenue per capita 952 890 910
Expenditures per capita
(less debt service and capital)651 616 628
Total expenditures per capita 1,101 1,063 1,168
Population 22,852 22,855
* Statewide data obtained from the office of the State Auditor's 2016 Minnesota City Finances Report
** 2016 per capita uses 2015 population forecast from Metropolitan Council
*** 2017 per capital data uses 2016 population forecast from the Metropolitan Council
**** Property taxes exclude tax increments
Population
Per Capita Trends
City of Crystal
Between
2016 Statewide *
Average-Cities
20,000 and 100,001
6.2
City of Crystal
Financial Analysis
17
TAX CAPACITY, CERTIFIED TAX LEVY, AND CITY TAX RATE
The chart below graphs the tax capacity, certified tax levy, and City tax rate for 2013 through 2017. The
tax capacity is based on total tax capacity, prior to adjustments for captured Tax Increment Financing
(TIF) and fiscal disparities. The certified tax levy amount is also prior to fiscal disparity adjustments.
With market values starting to rebound, the City's tax capacity increased from 2016 to 2017, by
$1,220,081, or 8.0%. With tax capacity increasing at a faster rate than the tax levy, the City's tax
capacity rate decreased to 49.0%.
$13,207,528 $13,180,542
$14,758,503
$15,250,280
$16,470,361
$8,713,272 $8,800,325 $8,865,262 $9,135,123
$9,798,620
56.2%
54.8%
49.1%
51.8%
49.0%
-5%
5%
15%
25%
35%
45%
55%
65%
$-
$3,000,000
$6,000,000
$9,000,000
$12,000,000
$15,000,000
$18,000,000
$21,000,000
$24,000,000
2013 2014 2015 2016 2017
Tax Capacity, Certified Levy, and City Tax Rate
Tax Capacity Certified Tax Levy City Tax Rate
* Tax capacity and city tax rate obtained from the League of Minnesota Cities
6.2
City of Crystal
Emerging Issues
18
Executive Summary
The following is an executive summary of financial and business related updates to assist you in staying
current on emerging issues in accounting and finance. This summary will give you a preview of the new
standards that have been recently issued and what is on the horizon for the near future. The most recent
and significant updates include:
• Accounting Standard Update – GASB Statement No. 75 – Accounting and Financial
Reporting for Postemployment Benefits Other Than Pensions – GASB has issued GASB
Statement No. 75 relating to accounting and financial reporting for postemployment benefits
other than pensions. This new statement requires governments in all types of OPEB plans to
present more extensive note disclosures and required supplementary information (RSI) about
their OPEB liabilities.
• Accounting Standard Update – GASB Statement No. 84 – Fiduciary Activities – GASB has
issued GASB Statement No. 84 relating to accounting and financial reporting for fiduciary
activities. This new statement establishes clarity to determines when a government has fiduciary
responsibility for a certain activity.
• Accounting Standard Update – GASB Statement No. 87 – Leases – GASB has issued GASB
Statement No. 87 relating to accounting and financial reporting for leases. This new statement
establishes a single model for lease accounting based on the principle that leases are financing of
the right to use an underlying asset.
The following are extensive summaries of the current updates. As your continued business partner, we
are committed to keeping you informed of new and emerging issues. We are happy to discuss these
issues with you further and their applicability to your City.
ACCOUNTING STANDARD UPDATE – GASB STATEMENT NO. 75 – ACCOUNTING AND
FINANCIAL REPORTING FOR POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS
The primary objective of this Statement is to improve accounting and financial reporting by state and
local governments for postemployment benefits other than pensions (other postemployment benefits or
OPEB). It also improves information provided by state and local governmental employers about
financial support for OPEB that is provided by other entities. This Statement results from a
comprehensive review of the effectiveness of existing standards of accounting and financial reporting
for all postemployment benefits (pensions and OPEB) with regard to providing decision-useful
information, supporting assessments of accountability and interperiod equity, and creating additional
transparency.
This Statement replaces the requirements of Statements No. 45, Accounting and Financial Reporting by
Employers for Postemployment Benefits Other Than Pensions, as amended, and No. 57, OPEB
Measurements by Agent Employers and Agent Multiple-Employer Plans, for OPEB. Statement No.
74, Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans, establishes new
accounting and financial reporting requirements for OPEB plans.
6.2
City of Crystal
Emerging Issues
19
ACCOUNTING STANDARD UPDATE – GASB STATEMENT NO. 75 – ACCOUNTING AND
FINANCIAL REPORTING FOR POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS
(CONTINUED)
GASB Statement No. 75 requires governments to report a liability on the face of the financial statements
for the OPEB that they provide:
• Governments that are responsible only for OPEB liabilities related to their own employees and
that provide OPEB through a defined benefit OPEB plan administered through a trust that meets
specified criteria will report a net OPEB liability—the difference between the total OPEB
liability and assets accumulated in the trust and restricted to making benefit payments.
• Governments that participate in a cost-sharing OPEB plan that is administered through a trust
that meets the specified criteria will report a liability equal to their proportionate share of the
collective OPEB liability for all entities participating in the cost-sharing plan.
• Governments that do not provide OPEB through a trust that meets specified criteria will report
the total OPEB liability related to their employees.
GASB Statement No. 75 carries forward from Statement No. 45 the option to use a specified alternative
measurement method in place of an actuarial valuation for purposes of determining the total OPEB
liability for benefits provided through OPEB plans in which there are fewer than 100 plan members
(active and inactive). This option was retained in order to reduce costs for smaller governments.
GASB Statement No. 75 requires governments in all types of OPEB plans to present more extensive
note disclosures and required supplementary information (RSI) about their OPEB liabilities. Among the
new note disclosures is a description of the effect on the reported OPEB liability of using a discount rate
and a healthcare cost trend rate that are one percentage point higher and one percentage point lower than
assumed by the government. The new RSI includes a schedule showing the causes of increases and
decreases in the OPEB liability and a schedule comparing a government's actual OPEB contributions to
its contribution requirements.
Information provided above was obtained from www.gasb.org.
ACCOUNTING STANDARD UPDATE – GASB STATEMENT NO. 84 – FIDUCIARY
ACTIVITIES
The objective of this Statement is to improve guidance regarding the identification of fiduciary activities
for accounting and financial reporting purposes and how those activities should be reported.
6.2
City of Crystal
Emerging Issues
20
ACCOUNTING STANDARD UPDATE – GASB STATEMENT NO. 84 – FIDUCIARY
ACTIVITIES (CONTINUED)
This Statement establishes criteria for identifying fiduciary activities of all state and local governments.
The focus of the criteria generally is on (1) whether a government is controlling the assets of the
fiduciary activity and (2) the beneficiaries with whom a fiduciary relationship exists. Separate criteria
are included to identify fiduciary component units and postemployment benefit arrangements that are
fiduciary activities. An activity meeting the criteria should be reported in a fiduciary fund in the basic
financial statements. Governments with activities meeting the criteria should present a statement of
fiduciary net position and a statement of changes in fiduciary net position. An exception to that
requirement is provided for a business-type activity that normally expects to hold custodial assets for
three months or less.
GASB Statement No. 84 describes four fiduciary funds that should be reported, if applicable: (1)
pension (and other employee benefit) trust funds, (2) investment trust funds, (3) private-purpose trust
funds, and (4) custodial funds. Custodial funds generally should report fiduciary activities that are not
held in a trust or equivalent arrangement that meets specific criteria.
This Statement also provides for recognition of a liability to the beneficiaries in a fiduciary fund when
an event has occurred that compels the government to disburse fiduciary resources. Events that compel a
government to disburse fiduciary resources occur when a demand for the resources has been made or
when no further action, approval, or condition is required to be taken or met by the beneficiary to release
the assets.
GASB Statement No. 84 is effective for reporting periods beginning after December 15, 2018. Earlier
application is encouraged.
Information provided above was obtained from www.gasb.org.
ACCOUNTING STANDARD UPDATE – GASB STATEMENT NO. 87 – LEASES
The objective of this Statement is to better meet the information needs of financial statement users by
improving accounting and financial reporting for leases by governments. This Statement increases the
usefulness of governments' financial statements by requiring recognition of certain lease assets and
liabilities for leases that previously were classified as operating leases and recognized as inflows of
resources or outflows of resources based on the payment provisions of the contract. It establishes a
single model for lease accounting based on the foundational principle that leases are financings of the
right to use an underlying asset. Under this Statement, a lessee is required to recognize a lease liability
and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a
deferred inflow of resources, thereby enhancing the relevance and consistency of information about
governments' leasing activities.
6.2
City of Crystal
Emerging Issues
21
ACCOUNTING STANDARD UPDATE – GASB STATEMENT NO. 87 – LEASES
(CONTINUED)
A lease is defined as a contract that conveys control of the right to use another entity's nonfinancial asset
(the underlying asset) as specified in the contract for a period of time in an exchange or exchange-like
transaction. Examples of nonfinancial assets include buildings, land, vehicles, and equipment. Any
contract that meets this definition should be accounted for under the leases guidance, unless specifically
excluded in this Statement.
A short-term lease is defined as a lease that, at the commencement of the lease term, has a maximum
possible term under the lease contract of 12 months (or less), including any options to extend, regardless
of their probability of being exercised. Lessees and lessors should recognize short-term lease payments
as outflows of resources or inflows of resources, respectively, based on the payment provisions of the
lease contract.
A lessee should recognize a lease liability and a lease asset at the commencement of the lease term,
unless the lease is a short-term lease or it transfers ownership of the underlying asset. The lease liability
should be measured at the present value of payments expected to be made during the lease term (less any
lease incentives). The lease asset should be measured at the amount of the initial measurement of the
lease liability, plus any payments made to the lessor at or before the commencement of the lease term
and certain direct costs. A lessee should reduce the lease liability as payments are made and recognize
an outflow of resources (for example, expense) for interest on the liability. The lessee should amortize
the lease asset in a systematic and rational manner over the shorter of the lease term or the useful life of
the underlying asset. The notes to financial statements should include a description of leasing
arrangements, the amount of lease assets recognized, and a schedule of future lease payments to be
made.
A lessor should recognize a lease receivable and a deferred inflow of resources at the commencement of
the lease term, with certain exceptions for leases of assets held as investments, certain regulated leases,
short-term leases, and leases that transfer ownership of the underlying asset. A lessor should not
derecognize the asset underlying the lease. The lease receivable should be measured at the present value
of lease payments expected to be received during the lease term. The deferred inflow of resources
should be measured at the value of the lease receivable plus any payments received at or before the
commencement of the lease term that relate to future periods. A lessor should recognize interest revenue
on the lease receivable and an inflow of resources (for example, revenue) from the deferred inflows of
resources in a systematic and rational manner over the term of the lease. The notes to financial
statements should include a description of leasing arrangements and the total amount of inflows of
resources recognized from leases.
GASB Statement No. 87 is effective for reporting periods beginning after December 15, 2019. Earlier
application is encouraged.
Information provided above was obtained from www.gasb.org.
6.2
City of Crystal
Hennepin County, Minnesota
Report on Legal Compliance
December 31, 2017
6.2
City of Crystal
Table of Contents
Report on Legal Compliance 1
6.2
1
BerganKDV, Ltd. bergankdv.com
Report on Legal Compliance
Independent Auditor's Report
Honorable Mayor and Members
of the City Council
City of Crystal
Crystal, Minnesota
We have audited, in accordance with auditing standards generally accepted in the United
States of America, the financial statements of the governmental activities, the business-type
activities, each major fund and the aggregate remaining fund information of City of Crystal,
Minnesota as of and for the year ended December 31, 2017, and the related notes to
financial statements, and have issued our report thereon dated May 2, 2018.
The Minnesota Legal Compliance Audit Guide for Cities, promulgated by the State Auditor
pursuant to Minn. Sat. § 6.65, contains seven categories of compliance to be tested:
contracting and bidding, deposits and investments, conflicts of interest, public indebtedness,
claims and disbursements, miscellaneous provisions and tax increment financing. Our audit
considered all of the listed categories.
In connection with our audit, nothing came to our attention that caused us to believe that the
City of Crystal, Minnesota failed to comply with the provisions of the Minnesota Legal
Compliance Audit Guide for Cities. However, our audit was not directed primarily toward
obtaining knowledge of such noncompliance. Accordingly, had we performed the additional
procedures, other matters may have come to our attention regarding the City's
noncompliance with the above referenced provisions.
This report is intended solely for the information and use of those charged with governance
and management of the City and the State Auditor and is not intended to be, and should not
be, used by anyone other than these specified parties.
Minneapolis, Minnesota
May 2, 2018
6.2
COMPREHENSIVE
ANNUAL FINANCIAL REPORT
OF THE
CITY OF CRYSTAL,
MINNESOTA
For the Year Ended
December 31, 2017
Prepared by
City of Crystal Finance Department
AEM Financial Solutions, Finance Director
6.2
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6.2
City of Crystal
Table of Contents
Page
Introductory Section
Elected Officials and Administration 1
Organizational Chart 2
Letter of Transmittal 3
Certificate of Achievement for Excellence in Financial Reporting 9
Award of Financial Reporting Achievement 10
Financial Section
Independent Auditor's Report 11
Management's Discussion and Analysis 15
Basic Financial Statements
Government-Wide Financial Statements
Statement of Net Position 30
Statement of Activities 31
Fund Financial Statements
Balance Sheet – Governmental Funds 32
Reconciliation of the Balance Sheet to the Statement of Net Position –
Governmental Funds 35
Statement of Revenues, Expenditures, and Changes in Fund Balances –
Governmental Funds 36
Reconciliation of the Statement of Revenues, Expenditures, and Changes in
Fund Balances to the Statement of Activities – Governmental Funds 39
Statement of Revenues, Expenditures, and Changes in Fund Balance –
Budget and Actual – General Fund 40
Statement of Revenues, Expenditures, and Changes in Fund Balance –
Budget and Actual – EDA – Special Revenue 42
Statement of Net Position – Proprietary Funds 43
Statement of Revenues, Expenses, and Changes in Fund Net Position
Proprietary Funds 44
Statement of Cash Flows – Proprietary Funds 46
Statement of Fiduciary Net Position 48
Notes to Financial Statements 49
Required Supplementary Information
Retiree Health Plan – Schedule of Funding Progress 91
Schedule of City's Proportionate Share of Net Pension Liability –
General Employees Retirement Fund 92
Schedule of City's Proportionate Share of Net Pension Liability –
Public Employees Police and Fire Retirement Fund 92
Schedule of City Contributions – General Employees Retirement Fund 93
Schedule of City Contributions – Public Employees Police and Fire Retirement Fund 93
Notes to Required Supplementary Information 94
6.2
City of Crystal
Table of Contents
Page
Supplementary Information
Nonmajor Governmental Funds 99
Combining and Individual Fund Financial Statements and Schedules
Combining Balance Sheet – Nonmajor Governmental Funds 100
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances –
Nonmajor Governmental Funds 102
Schedule of Revenues, Expenditures, and Changes in Fund Balance –
Budget and Actual – TIF Districts - Special Revenue 104
Schedule of Revenues, Expenditures, and Changes in Fund Balance –
Budget and Actual – Special Projects - Special Revenue 105
Schedule of Revenues, Expenditures, and Changes in Fund Balance –
Budget and Actual – Police Equipment Revolving - Capital Projects 106
Schedule of Revenues, Expenditures, and Changes in Fund Balance –
Budget and Actual – Fire Equipment Revolving - Capital Projects 107
Schedule of Revenues, Expenditures, and Changes in Fund Balance –
Budget and Actual – Street Maintenance - Capital Projects 108
Schedule of Revenues, Expenditures, and Changes in Fund Balance –
Budget and Actual – Major Building Replacement - Capital Projects 109
Schedule of Revenues, Expenditures, and Changes in Fund Balance –
Budget and Actual – Park Improvement - Capital Projects 110
Schedule of Revenues, Expenditures, and Changes in Fund Balance –
Budget and Actual – Cable TV Equipment - Capital Projects 111
Schedule of Revenues, Expenditures, and Changes in Fund Balance –
Budget and Actual – Debt Service 112
Schedule of Revenues, Expenditures, and Changes in Fund Balance
Budget and Actual – Capital Improvement Revolving - Capital Projects 113
Schedule of Revenues, Expenditures, and Changes in Fund Balance –
Budget and Actual – Street Reconstruction - Capital Projects 114
Fiduciary Funds 115
Statement of Changes in Agency Fund Assets and Liabilities 116
Statistical Section (Unaudited) Table Page
Net Position by Component 1 119
Change in Net Position 2 120
Fund Balances of Governmental Funds 3 122
Changes in Fund Balances of Governmental Funds 4 123
Taxable and Estimated Market Values of Taxable Property 5 124
Property Tax Rates – Direct and Overlapping Governments 6 125
Principal Property Taxpayers 7 126
Property Tax Levies and Collations 8 127
Legal Debt Margin Information 9 128
Ratios of Outstanding Debt by Type 10 129
6.2
City of Crystal
Table of Contents
Statistical Section (Unaudited) (Continued) Table Page
Ratios of General Bonded Debt Outstanding 11 130
Direct and Overlapping Governmental Activities Debt 12 131
Demographic and Economic Statistics 13 132
Principal Employers 14 133
Full-Time City Government Employees by Function 15 134
Operating Indicators by Function 16 135
Capital Asset Statistics by Function 17 136
6.2
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6.2
1 1
City of Crystal
Elected Officials and Administration
December 31, 2017
Elected Officials Position Term Expires
Jim Adams Mayor December 31, 2020
Nancy LaRache Council Member (Section I - Wards 1 and 2)December 31, 2020
Elizabeth Dahl Council Member (Ward 1)December 31, 2018
Jeff Kolb Council Member (Ward 2)December 31, 2018
Olga Parsons Council Member (Section II - Wards 3 and 4)December 31, 2018
John Budziszewski Council Member (Ward 3)December 31, 2020
Julie Deshler Council Member (Ward 4)December 31, 2020
Administration
Anne Norris City Manager Appointed
City Treasurer AEM Financial Solutions Appointed
City Clerk Christina Serres Appointed
City Attorney Kennedy & Graven, Chartered Appointed
City Prosecutor MacMillan, Wallace, & Athanases PLLC Appointed
6.2
2
City of Crystal
Organizational Chart
December 31, 2017
6.2
3
May 6, 2018
To the Crystal City Council and Citizens of the City of Crystal
The Comprehensive Annual Financial Report of the City of Crystal, Minnesota, for the fiscal year
ended December 31, 2017, is hereby submitted. The report was prepared in accordance with
accounting principles generally accepted in the United States of America and audited in
accordance with U.S. generally accepted auditing standards. The report meets the requirements of
the Office of the State Auditor and the City of Crystal Charter.
This report consists of management's representations concerning the finances of the City.
Consequently, management assumes full responsibility for the completeness and reliability of all
of the information presented in this report. To provide a reasonable basis for making these
representations, management of the City has established a comprehensive internal control
framework that is designed both to protect the government's assets from loss, theft, or misuse, and
to compile sufficient reliable information for the preparation of the City's financial statements in
conformity with GAAP. Because the cost of internal controls should not outweigh their benefits,
the City's internal controls have been designed to provide reasonable, rather than absolute,
assurance that the financial statements will be free from material misstatement. As management,
we assert that, to the best of our knowledge and belief, this financial report is complete and reliable
in all material respects.
The City's financial statements have been audited by BerganKDV, Ltd., a firm of licensed certified
public accountants. The goal of the independent audit was to provide reasonable assurance that the
financial statements of the City for the fiscal year ended December 31, 2017, are free of material
misstatement. The independent audit involved examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements; assessing the accounting principles used and
significant estimates made by management; and evaluating the overall financial statement
presentation. The independent auditor concluded, based upon the audit, that there was a reasonable
basis for rendering an unmodified opinion that the City's financial statements for the fiscal year
ended December 31, 2017, are fairly presented in conformity with GAAP. The independent
auditor's report is presented as the first component of the Financial Section of this report.
GAAP requires 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's MD&A can be found immediately following the report of the
independent auditors.
4141 Douglas Drive North • Crystal, Minnesota 55422-1696
Tel: (763) 531-1000 • Fax: (763) 531-1188 • www.crystalmn.gov
6.2
4
Profile of Government
The City, incorporated in 1960, is a northwestern suburb of the Minneapolis/St. Paul metropolitan
area, lying adjacent to the City of Minneapolis. The City lies wholly within Hennepin County and
encompasses an area of 5.8 square miles and serves a population of approximately 22,000
residents. The City is empowered to levy a property tax on both real and personal properties located
within its boundaries. While it also is empowered by state statute to extend its corporate limits by
annexation, the City is a completely developed community and is bordered on all sides by other
incorporated communities.
The City operates under the Council-Manager form of government. Policy-making and legislative
authority are vested in a governing council (City Council) consisting of the mayor and six other
members. The City Council is responsible, among other things, for passing ordinances, adopting
the budget, appointing committees, and hiring both the City Manager and the City Attorney. The
City Manager is responsible for carrying out the policies and ordinances of the City Council and
for overseeing the day-to-day operations of the City. The City Council is elected on a non-partisan
basis. Council members serve four-year staggered terms, with three council members elected every
two years. The mayor is also elected to serve a four-year term. The six council members are elected
by section and ward; the mayor is elected at large.
The City provides its residents and businesses with a full range of services, including police
protection, the construction and maintenance of streets and other infrastructure, recreational
activities, building and housing inspection, health inspection, and planning and code enforcement.
In addition, the City operates five enterprises for water, sanitary sewer, storm drainage, street
lighting, and recycling services.
Fire protection services are provided by a joint venture with the West Metro Fire-Rescue District,
and water services are provided by a joint venture with the Golden Valley, Crystal, and New Hope
Joint Water Commission. Additional information on these joint ventures can be found in the notes
to the financial statements.
Housing and redevelopment activities are provided through a legall y separate Economic
Development Authority (EDA). Its governing board is comprised of the City council members and
the City has operational responsibility of the EDA, meaning it manages the EDA's activities in
essentially the same manner in which it manages its own programs and departments. Therefore, it
has been included as an integral part of the City's financial statements.
The annual budget serves as the foundation for the City's financial planning and control. In
addition, the government maintains budgetary controls. The objective of budgetary controls is to
ensure compliance with legal provisions embodied in the annual budget approved by the city
council. The level of budgetary control (i.e. the level at which expenditures cannot legally exceed
the budgeted amount) is at the fund level for all fund types, with the exception of the General Fund,
which is at the department level. Budget-to-Actual comparisons are provided in this financial
report for each individual governmental fund for which an annual budget has been adopted.
6.2
5
FACTORS AFFECTING ECONOMIC CONDITION
Local Economy
Crystal is a blue-collar, bedroom community. While it has a small amount of industry, it has a
good retail sector and is part of the northwest metro area with an abundance of living wage jobs
within easy commuting distance. Good schools and affordable housing make the City attractive to
young families and first time home buyers.
Access to major highways is good. Hennepin County reconstructed the portion of Hennepin
County Highway 81 that passes through the City. Commercial and industrial properties along the
Highway 81 corridor represent major redevelopment opportunities for future growth.
The City experienced its most rapid population growth from 1950 to 1970, when the population
grew from 5,700 to its peak of 30,925. Population declined after 1970, as families matured and
children left home. According to the 2010 Census, Crystal's population was 22,151. The most
recent estimate from the Metropolitan Council is that Crystal's population is 22,855.
The City saw significant increases in the market value of commercial/industrial and residential
property until 2008. The City's taxable market value decreased 4.2% from 2008 to 2009, 7.6%
from 2009 to 2010, 10.1% from 2010 to 2011, 13.3% from 2011 to 2012, 12.1% from 2012 to
2013, and 0.1% from 2013 to 2014. Most of the 2011 to 2012 change can be attributed to a change
the State of Minnesota made in the way taxable values are calculated. The City's taxable market
value increased 13.9% from 2014 to 2015 and 14.45% from 2015 to 2016. Table 5 in the Statistical
Section provides additional information on property values.
Because Crystal is fully developed, redevelopment of blighted or underutilized sites is generally
necessary to increase the community's tax base. The City investigates redevelopment options as
they arise, and in 2017 the City purchased and demolished a blighted 4-plex.
The City sold five lots for new home construction in 2017. In addition , private-sector infill
development yielded 15 new houses in 2017. Going into 2018, the City has five lots available for
construction of new homes, and private builders have four. It is anticipated that most of these will
be sold for new home construction within a year.
New homes not only increase the City's assessed valuation, but they also serve as a confidence
signal for other homeowners in the neighborhood to make improvements to their existing houses.
To that end, the City provides financial incentives and assistance for home improvements.
Homeowners up to 110% of area median income are eligible for a grant of 20% of the project cost.
The City also provides an interest rate buy-down for MHFA Community Fix-Up Fund loans.
The overall goal of these efforts is to improve the condition, quality, and desirability of the housing
stock to enhance Crystal's reputation as a desirable yet affordable place to buy a home.
6.2
6
FACTORS AFFECTING ECONOMIC CONDITION (CONTINUED)
Long-term Financial Planning
Capital budgeting for the replacement of buildings, streets, parks, and vehicles is a major financial
challenge. The City has an ongoing street reconstruction program designed to rebuild streets, add
new curb/gutter/sidewalk, and add storm sewer. The street program is planned to be completed
one phase/neighborhood at a time, over 16 phases. Phase 16 was built in 2017 and will be finalized
in 2018.
The Major Building Replacement Fund was created for the purpose of accumulating a reserve for
the eventual major remodeling or replacement of the City Hall/Police Station, Fire Stations 1 and
2, Streets/Parks and Utility buildings, and the Community Center. Construction of a new public
works facility was completed in 2015 and other major building projects will be needed over the
next fifteen years.
Relevant Financial Policies
It is the City's policy to maintain a fund balance in its General Fund of at least 45% of the next
year's operating budget. This is needed for cash flow purposes. Property taxes and local
government aid (LGA) from the State of Minnesota were 79.6% of the General Fund's revenue in
2017. The City operates on a calendar year, but half of the property taxes and LGA are received
in July and the other half in December.
Major Initiatives
The City continues to seek opportunities to facilitate commercial and residential redevelopment,
subsidize home improvements by current owners, and fund construction projects that enhance the
City's future development.
Awards
The Government Finance Officers Association of the United States and Canada (GFOA) awarded
a Certificate of Achievement for Excellence in Financial Reporting to the City of Crystal for its
comprehensive annual financial report for the fiscal year ended December 31, 2016.
In order to be awarded a Certificate of Achievement, a government must publish an easily readable
and efficiently organized comprehensive annual financial report. This report must satisfy both
accounting principles generally accepted in the United States of America and applicable legal
requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current
comprehensive annual financial report continues to meet the Certificate of Achievement Program's
requirements and we are submitting it to the GFOA to determine its eligibility for another
certificate.
6.2
7
Acknowledgements
The preparation of this report could not have been accomplished without the efficient and
dedicated services of the staff of the finance department. We would like to express our appreciation
to all members of the department for their assistance and contributions to the preparation of this
report. Due credit also should be given to the mayor and the City Council for their interest and
support in planning and conducting the operati ons of the government in a responsible and
progressive manner.
Respectfully submitted,
Anne L. Norris
City Manager
6.2
8
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6.2
9
6.2
10
6
.
2
11
BerganKDV, Ltd. bergankdv.com
Independent Auditor's Report
Honorable Mayor and Members
of the City Council
City of Crystal
Crystal, Minnesota
Report on the Financial Statements
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 Crystal, Minnesota, as of and for the year ended December 31, 2017, and the
related notes to financial statements, which collectively comprise the City's basic financial
statements as listed in the Table of Contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial
statements in accordance with accounting principles generally accepted in the United States
of America; this includes the design, implementation, and maintenance of internal control
relevant to the preparation and fair presentation of financial statements that are free from
material misstatements, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit.
We did not audit the financial statements of the West Metro Fire-Rescue District nor the
Golden Valley, Crystal, New Hope Joint Water Commission, joint ventures of the City
which are disclosed in the notes to the City's financial statements, and in which the City
reports an equity interest of $1,690,079 and $4,323,142, respectively. The financial
statements of the District and Commission were audited by other auditors whose reports
thereon have been furnished to us and our opinion, insofar as it relates to the amounts
disclosed for the District and Commission, is based on the report of the other auditors. We
conducted our audit in accordance with auditing standards generally accepted in the United
States of America. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free from material
misstatement.
6.2
12
Auditor's Responsibility (Continued)
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on the auditor's
judgment, including the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the City's preparation and fair presentation of the
financial statements in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
City's internal control. Accordingly, we express no such opinion. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of
significant accounting estimates made by management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our audit opinions.
Opinions
In our opinion, the financial statements referred to in the first paragraph 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 Crystal, Minnesota, as of December 31, 2017, and the respective changes in
financial position and where applicable, cash flows, thereof, and the respective budgetary
comparisons for the General Fund and EDA Special Revenue Fund for the year then ended
in accordance with accounting principles generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
Management's Discussion and Analysis, which follows this report letter, and the Required
Supplementary Information as indicated in the Table of Contents, be presented to
supplement the basic financial statements. Such information, although not a part of the basic
financial statements, is required by the Governmental Accounting Standards Board (GASB)
who considers it to be an essential part of financial reporting for placing the basic financial
statements in an appropriate operational, economic, or historical context. We have applied
certain limited procedures to the Required Supplementary Information in accordance with
auditing standards generally accepted in the United States of America, which consisted of
inquiries of management about the methods of preparing the information and comparing the
information for consistency with management's responses to our inquiries, the basic financial
statements and other knowledge we obtained during our audit of the basic financial
statements. We do not express an opinion or provide any assurance on the information
because the limited procedures do not provide us with sufficient evidence to express an
opinion or provide any assurance.
6.2
13 13
Other Matters (Continued)
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the City of Crystal's basic financial statements. The introductory
section, combining and individual fund financial statements, and schedules and statistical
section are presented for purposes of additional analysis and are not a required part of the
basic financial statements.
The combining and individual fund financial statements and schedules are the responsibility
of management and were derived from and relate directly to the underlying accounting and
other records used to prepare the basic financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the basic financial statements and
certain additional procedures, including comparing and reconciling such information directly
to the underlying accounting and other records used to prepare the basic financial statements
or to the basic financial statements themselves, and other additional procedures in
accordance with auditing standards generally accepted in the United States of America. In
our opinion, the combining and individual fund financial statements and schedules are fairly
stated, in all material respects, in relation to the basic financial statements 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 do not
express an opinion or provide any assurance on them.
Minneapolis, Minnesota
May 2, 2018
6.2
14
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6.2
City of Crystal
Management's Discussion and Analysis
15
As management of the City of Crystal (the City), we have provided readers of the City's financial
statements with this narrative overview and analysis of the financial activities of the City for the fiscal
year ended December 31, 2017. We encourage readers to consider the information presented here in
conjunction with additional information that we have furnished in our Letter of Transmittal, located
previously in this report.
FINANCIAL HIGHLIGHTS
The assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows of
resources at the close of the most recent fiscal year by $116,877,672. Of this amount, $33,960,626 is
considered unrestricted net position and may be used to meet the City's ongoing obligations to citizens
and creditors.
The City's total net position increased by $4,038,920. Governmental activities experienced a $648,036
increase in net position from operations while business-type activities experienced a $3,390,884 increase
in net position from operations.
At the end of the fiscal year, total fund balance for the General Fund was $6,892,456, or 51.70% of total
General Fund expenditures and transfers out.
The City's total long term debt (excluding net pension liability and net OPEB obligation) increased by
$2,881,559 during the fiscal year. The City's net OPEB obligation increased by $79,546.
Overview of the Financial Statements
Management's Discussion and Analysis is intended to serve as an introduction to the City's basic financial
statements, which are comprised of 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's finances, in a manner similar to private sector business.
The Statement of Net Position presents information on all of the City's assets plus deferred outflows of
resources and liabilities plus deferred inflows of resources, with the difference between the two reported
as net position. Over time, increases or decreases in net position may serve as a useful indicator of
whether the financial position of the City is improving or deteriorating.
The Statement of Activities presents information showing how the City's net position changed during the
most recent fiscal year. All changes in net position 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).
6.2
City of Crystal
Management's Discussion and Analysis
16
GOVERNMENT-WIDE FINANCIAL STATEMENTS (CONTINUED)
Both of the government-wide financial statements distinguish functions of the City 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 include general government, public safety, public
works, parks and recreation, and community development. The business-type activities of the City include
enterprises for water, sanitary sewer, storm drainage, street lights, and recycling.
The government-wide financial statements include not only the City itself (known as the primary
government), but also the Economic Development Authority (EDA). The EDA is a legally separate entity
and its governing board is comprised of the City Council members. The City has operational
responsibility of the EDA and it functions as a department of the City to provide housing and
redevelopment assistance through the administration of various programs. Therefore, the EDA has been
included as an integral part of the City's financial statements.
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, 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 can be divided into three categories, including 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 spendable
resources, as well as balances of spendable resources available at the end of the fiscal year. Such
information may be useful in evaluating a government's near-term financing 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 statements. By doing
so, readers may better understand the long term impact of the government's near term financing decisions.
Both the Governmental Fund Balance Sheet and the Governmental Fund Statement of Revenues,
Expenditures, and Changes in Fund Balances provide a reconciliation to facilitate this comparison
between governmental funds and governmental activities.
The City maintains twelve individual 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 General, EDA, Debt Service, Capital Improvement Revolving, Police
Equipment Revolving, and Street Reconstruction funds, all of which are considered to be major funds.
Data from the other six 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.
6.2
City of Crystal
Management's Discussion and Analysis
17
GOVERNMENT-WIDE FINANCIAL STATEMENTS (CONTINUED)
Governmental Funds (Continued)
The City adopts an annual appropriated budget for all of its governmental funds. Budget to actual
comparisons are provided in this financial report for each individual governmental fund for which an
annual budget has been adopted.
Proprietary Funds
The City maintains two different types of proprietary funds. Enterprise funds are used to report the same
functions presented as business-type activities in the government-wide financial statements. The City uses
enterprise funds to account for its water, sanitary sewer, storm drainage, street lights, and recycling
operations. Internal service funds are an accounting device used to accumulate and allocate costs
internally among the City's various functions. The City uses an internal service fund to account for its
self-insurance activities. Because this activit y predominantly benefits governmental rather than business-
type functions, it has been included within governmental activities in the government-wide financial
statements.
Proprietary funds provide the same type of information as the government-wide financial statements, only
in more detail. The proprietary fund financial statements provide separate information for the water,
sanitary sewer, storm drainage, street lights, and recycling operations, all of which are reported as major
funds of the City.
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's own programs. The accounting used for fiduciary funds
is much like that used for proprietary funds.
Notes to 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.
Other Information
Required Supplementary Information concerning the City's progress in funding its obligation to provide
pension and OPEB benefits to its employees is presented immediately following the notes to the financial
statements.
Combining and individual fund statements and schedules for nonmajor funds are presented immediately
following the Required Supplementary Information.
6.2
City of Crystal
Management's Discussion and Analysis
18
GOVERNMENT-WIDE FINANCIAL ANALYSIS
Net Position
The City has 53.75% of its total net position invested in capital assets (including land, buildings and
structures, improvements other than buildings, machinery and equipment, office equipment and
furnishings, software, vehicles and trailers, and infrastructure), less any related outstanding debt used to
acquire those assets. The City uses these capital assets to provide services to citizens. Consequently, these
assets are not available for future spending. Although the City'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.
An additional 17.20% of the City's net position represents resources that are subject to external
restrictions on how they may be used. The remaining balance of 29.05% represents unrestricted net
position that may be used to meet the government's ongoing obligations to citizens and creditors.
At the end of the current fiscal year, the City is able to report positive balances in all three categories of
net position, both for the government and business-type activities. The same situation held true for the
prior fiscal year.
A summary of the City's net position follows:
Net Position
Governmental Activities Business-type Activities Total
2017 2016 2017 2016 2017 2016
Current and other assets $ 56,570,251 $ 52,077,302 $ 6,255,064 $ 5,414,668 $ 62,825,315 $ 57,491,970
Equity interest in joint venture 1,690,079 2,036,218 4,323,142 4,045,981 6,013,221 6,082,199
Capital assets 59,603,065 56,465,094 22,283,455 19,889,415 81,886,520 76,354,509
Total assets 117,863,395 110,578,614 32,861,661 29,350,064 150,725,056 139,928,678
Deferred Outflows of Resources 6,135,231 9,061,274 168,202 337,083 6,303,433 9,398,357
Long-term liabilities
outstanding 27,714,798 30,415,118 870,852 968,266 28,585,650 31,383,384
Other liabilities 1,510,590 3,096,853 176,180 156,576 1,686,770 3,253,429
Total liabilities 29,225,388 33,511,971 1,047,032 1,124,842 30,272,420 34,615,202
Deferred Inflows of Resources 9,751,627 1,754,342 126,770 97,128 9,878,397 1,851,470
Net Position
Net investment
in capital assets 40,534,551 40,421,924 22,283,455 19,889,415 62,818,006 60,311,339
Restricted 20,099,040 18,850,900 - - 20,099,040 18,580,900
Unrestricted 24,388,020 25,370,751 9,572,606 8,575,762 33,960,626 33,946,513
Total net position $ 85,021,611 $ 84,373,575 $ 31,856,061 $ 28,465,177 $116,877,672 $112,838,752
6.2
City of Crystal
Management's Discussion and Analysis
19
GOVERNMENT-WIDE FINANCIAL ANALYSIS (CONTINUED)
Net Position (Continued)
A summary of the City's changes in net position and revenues and expenses for 2017 and 2016 follows:
Changes in Net Position
Governmental Activities Business-type Activities Total
2017 2016 2017 2016 2017 2016
Revenues:
Program revenues
Charges for services $ 1,969,710 $ 2,015,302 $ 7,033,104 $ 6,663,647 $ 9,002,814 $ 8,678,949
Operating grants and
contributions 659,450 728,449 680,740 1,859,532 1,340,190 2,587,981
Capital grants and
contributions 7,473,350 7,393,250 - - 7,473,350 7,393,250
General revenues
Property taxes 10,469,019 9,955,391 10,469,019 9,955,391
Intergovernmental 1,753,898 1,712,591 - - 1,753,898 1,712,591
Grants and contributions
not restricted to
specific programs - - - - - -
Other 393,458 528,091 52,208 53,794 445,666 581,885
Total revenues 22,718,885 22,333,074 7,766,052 8,576,973 30,484,937 30,910,047
Expenses
General government 2,964,731 3,226,278 - - 2,964,731 3,226,278
Public safety 7,546,777 7,685,700 - - 7,546,777 7,685,700
Public works 4,224,253 6,511,486 - - 4,224,253 6,511,486
Parks and recreation 3,128,275 2,759,211 - - 3,128,275 2,759,211
Community development 1,616,752 1,174,426 - - 1,616,752 1,174,426
Interest on long-term debt 541,919 563,308 - - 541,919 563,308
Water - - 2,970,228 3,047,910 2,970,228 3,047,910
Sanitary sewer - - 2,144,581 2,169,072 2,144,581 2,169,072
Storm drainage - - 809,169 903,884 809,169 903,884
Street lights - - 174,479 155,056 174,479 155,056
Recycling - - 324,853 324,496 324,853 324,496
Total Expenses 20,022,707 21,902,409 6,423,310 6,600,418 26,446,017 28,520,827
change in net position before transfers 2,696,178 412,665 1,342,742 1,976,555 4,038,920 2,389,220
Transfers (2,048,142) 53,732 2,048,142
(53,732)
- -
Change in net position 648,036 466,397 3,390,884 1,922,823 4,038,920 2,389,220
Net position - beginning of year 84,373,575 83,907,178 28,465,177 26,542,354 112,838,752 110,449,532
Net position - end of year $ 85,021,611 $ 84,373,575 $ 31,856,061 $ 28,465,177 $ 116,877,672 $ 112,838,752
6.2
City of Crystal
Management's Discussion and Analysis
20
GOVERNMENT-WIDE FINANCIAL ANALYSIS (CONTINUED)
Governmental Activities
Governmental activities increased the City's governmental-type net position by $648,036, or 0.77%,
accounting for 16.04% of the total increase in the City's net position.
Business-type Activities
Business-type activities increased the City's business-type net position by $3,390,884, or 11.91%,
offsetting for 83.96% of the total increase in the City's net position.
Key elements of the net increase include:
• Net position of the water, sanitary sewer, and storm drainage funds were all increased by capital
contributions related to construction of a new public works facility.
• Rate increases –
The City Council approved a rate increase of 5.05% for the sanitary sewer utility, which increased
rates charged from $52.50 per quarter for residential properties in 2016 to $55.15 per quarter in
2017. In addition, the sanitary sewer utility increase the rate per 1,000 gallons from commercials
users from $2.32 in 2016 to $2.43 in 2017.
The City Council approved a rate increase of 22.22% for the storm drainage utility, which
increased rates charged from $13.50 per quarter for residential properties in 2016 to $16.50 per
quarter in 2017. In addition, the storm drainage utility rate per residential equivalency factor (per
acre) for commercial users increase by 22.2%, this increase the quarterly factor from $337.50 in
2016 to $412.50 in 2017.
6.2
City of Crystal
Management's Discussion and Analysis
21
GOVERNMENT-WIDE FINANCIAL ANALYSIS (CONTINUED)
Business-Type Activities (Continued)
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
General
government
Public safety Public works Parks and
recreation
Community
development
Interest on
long-term
debt
2017 Expenses and Program Revenues -Governmental Activities
Expenses
Revenues
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
$9,000,000
General
government
Public safety Public works Parks and
recreation
Community
development
Interest on
long-term
debt
2016 Expenses and Program Revenues -Governmental Activities
Expenses
Revenues
6.2
City of Crystal
Management's Discussion and Analysis
22
GOVERNMENTAL ACTIVITIES
Capital Grants and
Contributions
33%
Charges for
Services
9%
Operating Grants
and Constributions
3%
Property Taxes
46%
Grants and
Contributions not
Restricted to
Specific Programs
0%…
Intergovernmental
8%
Unrestricted
Invements Earnings
1%
Other General
Revenue
0%
2017 Revenues by Source -Governmental Activities
Capital Grants and
Contributions
33%
Charges for
Servies
9%
Operating Grants
and Contributions
3%
Property Taxes
45%
Grants and
Contributions not
Restricted to
Specific Programs
0%
Intergovernmental
8%
Unrestricted
Investment
Earnings
2%
Other General
Revenue
0%
2016 Revenues by Source -Governmental Activities
6.2
City of Crystal
Management's Discussion and Analysis
23
EXPENSES AND PROGRAM REVENUES
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
Water Sanitary Sewer Storm drainage Street lights Recycling
2017 Expenses and Program Revenues -Business Type Activities
Expenses
Revenues
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
Water Sanitary Sewer Storm drainage Street lights Recycling
2016 Expenses and Program Revenues -Business Type Activities
Expenses
Revenues
6.2
City of Crystal
Management's Discussion and Analysis
24
REVENUES BY SOURCE
Charges for Services
91%
Operating Grants
and Contributions
9%
Capital Grants and
Contribusions
0%
Unrestricted
Invements Earnings
0%
2017 Revenues by Source -Business Type Activities
Charges for Services
78%
Operatings Grants
and Contributions
22%
Capital Granats and
Contributions
0%
Unrestrited
Invements Earnings
0%
2016 Revenues by Source -Business Type Activities
6.2
City of Crystal
Management's Discussion and Analysis
25
FINANCIAL ANALYSIS OF THE CITY'S FUNDS
Governmental Funds
At the end of the fiscal year, the City's governmental funds reported combined ending fund balances of
$34,388,573, a decrease of $469,101 compared to the prior year.
Approximately 17.79% of the total amount ($6,119,325) constitutes unassigned fund balance, which is
available for spending at the government's discretion. The remainder of fund balance has been classified
as nonspendable ($19,169), restricted ($7,108,815), committed ($21,067,340), and assigned ($73,927).
The General Fund is the main operating fund of the City. At the end of the fiscal year total fund balance
was $6,892,456. Unassigned fund balance was $6,119,325, $753,962 was committed for compensated
absences, and $19,169 was reported as nonspendable to offset inventory. As a measure of the General
Fund's liquidity, it may be useful to compare total fund balance to total fund expenditures. Total fund
balance represents 51.70% of total General Fund expenditures and transfers out. The total fund balance is
slightly more than the balance called for by the City's fund balance policy. Fund balance provides
working capital to support operations until the first current-year tax settlement is received in June and
July.
There was a decrease of $161,319 in the fund balance of the General Fund during the current fiscal year.
Total revenues were $42,137 lower than the final budget. Special assessments; licenses, permits and
inspections; charges for sales and/or services; fines and forfeitures, and interest were lower than budget.
Actual expenditures were $116,829 higher than the final budget.
The EDA Fund recorded a decrease of $369,292 in its fund balance during the current fiscal year. Total
revenues were lower than budget by $9,138. The fund balance of $3,846,024 was committed for
economic development projects.
The Debt Service Fund has a total fund balance of $5,312,296, all of which is restricted for the payment
of debt service. The net decrease in fund balance during the current fiscal year was $438,046. For
additional transaction details, refer to the Long Term Debt section located later in this Management's
Discussion and Analysis, or to Note 7 in the notes to the financial statements.
There was a decrease of $145,940 in the fund balance of the Capital Improvement Revolving Fund during
the current fiscal year. This was due to planned use of fund balance for capital projects. The fund balance
includes $8,211,949 that is committed.
The Street Reconstruction Fund recorded an increase of $586,538 in its fund balance during the current
fiscal year. This was due to planned use of fund balance for street reconstruction projects. Major
reconstruction work on Phase 16 of the16-phase street reconstruction program was completed during
2017. All of the fund balance of $2,718,992 is committed.
The Police Equipment Revolving Fund Balance declined by $237,640.
6.2
City of Crystal
Management's Discussion and Analysis
26
FINANCIAL ANALYSIS OF THE CITY'S FUNDS (CONTINUED)
Proprietary Funds
The City's proprietary funds provide the same type of information found in the government-wide financial
statements, but in more detail.
Unrestricted net position in the City's enterprise funds totaled $9,572,606 at the end of the fiscal year. The
water, sanitary sewer, storm drainage, street light, and recycling funds reported increases in net position
from operations of $981,834, $1,153,795, $1,226,730, $18,521, and $10,004, respectively.
The water, sanitary sewer, and storm drainage funds received capital contributions of $404,159,
$1,113,784, and $933,260, respectively.
Budget Highlights
The City's General fund budget was not amended during the year. Revenues and expenditures both
provided negative budget variances. Total revenues were $42,137 lower than the final budget. Special
assessments; licenses, permits and inspections; charges for sales and/or services; fines and forfeitures, and
interest were lower than budget. Actual expenditures were $116,829 higher than the final budget.
Capital Assets
The City's net capital assets for its governmental and business-type activities as of December 31, 2017,
are $81,886,520. This balance represents a net increase of $5,532,011 from the prior year. Additional
details of capital asset activity for the year can be found in Note 5 in the notes to the financial statements.
Major capital activity during the year included the following:
• Major work on Phase 16 of the ongoing street reconstruction program was completed during 2017.
The project is recorded as construction in progress pending completion in 2018.
Long-term Debt
The City's total long term debt increased by $2,881,559, or 16.87%, during the fiscal year. Normal
required annual payments were made on bonds payable and compensated absences. During 2017, the City
issued G.O. Street Improvement Bonds, Series 2017A, to finance special assessments relating to Phase 16
street reconstruction.
Additional details of long term debt activity for the year can be found in Note 6 in the notes to financial
statements.
The City's sound financial management and strong financial position, as evidenced by favorable reserves,
has earned the City an Aa2 rating from Moody's Investors Service on its G.O. debt. Moody's Investors
Service last completed a rating review in 2017 with no change in the rating. The City expects to receive
the Aa2 rating in the future.
State statutes limit the amount of G.O. debt a governmental entity may issue to 3% of total taxable market
value. The current debt limitation for the City is $49,046,997. The City currently has no outstanding G.O.
debt.
6.2
City of Crystal
Management's Discussion and Analysis
27
FINANCIAL ANALYSIS OF THE CITY'S FUNDS (CONTINUED)
Economic Factors and Next Year's Budgets and Rates
Economic factors affect the preparation of annual budgets. The following factors were considered in
preparing the City's budget for the 2018 fiscal year:
• The 2018 budget includes a 6.16% tax levy increase. This will be supplemented by increases in
other revenues to cover an inflationary increase in the operating budget.
• The City annually updates a five-year utility rate study reviewing operational and capital needs for
each utility. For 2018, street light and recycling rates remain stable, water services for residential
customers increased by an average of 5.0%, sewer services for residential customers increased by
11.01%, and storm drainage rates for single family homes increased 10.00%.
Requests for Information
Questions concerning any of the information provided in this report or requests for additional information
should be addressed to:
City of Crystal
Attn: Finance Director
4141 Douglas Drive N.
Crystal, MN 55422
6.2
28 28
(THIS PAGE LEFT BLANK INTENTIONALLY)
6.2
29
BASIC FINANCIAL STATEMENTS
6.2
City of Crystal
Statement of Net Position
December 31, 2017
Governmental
Activities
Business-Type
Activities Total
Assets
Cash and investments (including cash equivalents)38,616,447$ 4,470,551$ 43,086,998$
Cash with fiscal agent 72,020 - 72,020
Accrued interest 36,217 - 36,217
Accounts receivable 63,378 1,327,015 1,390,393
Delinquent taxes receivable 129,690 - 129,690
Special assessments receivable 16,771,435 373,116 17,144,551
Due from other governments 130,205 25,588 155,793
Inventory 19,169 57,494 76,663
Prepaid items - 1,300 1,300
Land held for resale 699,000 - 699,000
Notes receivable 32,690 - 32,690
Equity interest in joint venture 1,690,079 4,323,142 6,013,221
Capital assets (net of accumulated depreciation,
where applicable)
Land 6,860,536 759,062 7,619,598
Buildings and structures 9,770,362 2,390,579 12,160,941
Improvements other than buildings 2,624,109 7,096 2,631,205
Machinery and equipment 1,569,015 2,368,247 3,937,262
Office equipment and furnishings 416,614 - 416,614
Software 57,155 64,194 121,349
Vehicles and trailers 1,137,054 323,503 1,460,557
Infrastructure 32,686,038 13,926,547 46,612,585
Construction in progress 4,482,182 2,444,227 6,926,409
Total assets 117,863,395 32,861,661 150,725,056
Deferred Outflows of Resources
Pension-related deferred outflows 6,135,231 168,202 6,303,433
Liabilities
Accounts and other current liabilities 1,216,113 176,180 1,392,293
Interest payable 202,650 - 202,650
Unearned revenue 91,827 - 91,827
Noncurrent liabilities
Due within one year 1,611,993 31,025 1,643,018
Due in more than one year 18,210,483 104,930 18,315,413
Net pension liability 7,264,789 671,722 7,936,511
Net OPEB obligation 627,533 63,175 690,708
Total liabilities 29,225,388 1,047,032 30,272,420
Deferred Inflows of Resources
State aid related deferred inflows of resources 3,101,780 - 3,101,780
Pension-related deferred inflows of resources 6,649,847 126,770 6,776,617
Total deferred inflows of resources 9,751,627 126,770 9,878,397
Net Position
Net investment in capital assets 40,534,551 22,283,455 62,818,006
Restricted for
TIF projects 1,768,695 - 1,768,695
Debt service 18,302,521 - 18,302,521
Special projects 27,824 - 27,824
Unrestricted 24,388,020 9,572,606 33,960,626
Total net position 85,021,611$ 31,856,061$ 116,877,672$
See notes to financial statements.30
6.2
Program Revenues
Expenses
Charges for
Services
Operating
Grants and
Contributions
Capital Grants
and
Contributions
Governmental
Activities
Business-Type
Activities Total
Governmental activities
General government 2,964,731$ 279,603$ 17,358$ 38,120$ (2,629,650)$ -$ (2,629,650)$
Public safety 7,546,777 380,498 612,827 - (6,553,452) - (6,553,452)
Public works 4,224,253 - 23,929 7,375,899 3,175,575 - 3,175,575
Parks and recreation 3,128,275 513,457 5,336 - (2,609,482) - (2,609,482)
Community development 1,616,752 796,152 - 59,331 (761,269) - (761,269)
Interest on long-term debt 541,919 - - - (541,919) - (541,919)
Total governmental activities 20,022,707 1,969,710 659,450 7,473,350 (9,920,197) - (9,920,197)
Business-type activities
Water 2,970,228 3,138,317 533,667 - - 701,756 701,756
Sanitary sewer 2,144,581 2,300,866 997 - - 157,282 157,282
Storm drainage 809,169 1,058,549 146,076 - - 395,456 395,456
Street lights 174,479 195,122 - - - 20,643 20,643
Recycling 324,853 340,250 - - - 15,397 15,397
Total business-type activities 6,423,310 7,033,104 680,740 - - 1,290,534 1,290,534
Total primary government 26,446,017$ 9,002,814$ 1,340,190$ 7,473,350$ (9,920,197) 1,290,534 (8,629,663)
General revenues
Property taxes 10,469,019 - 10,469,019
Intergovernmental 1,753,898 - 1,753,898
Unrestricted investment earnings 266,350 42,244 308,594
Other general revenue 35,994 - 35,994
Gain on sale of capital assets 91,114 9,964 101,078
Transfers (2,048,142) 2,048,142 -
Total general revenues and transfers 10,568,233 2,100,350 12,668,583
Change in net position 648,036 3,390,884 4,038,920
Net position - beginning 84,373,575 28,465,177 112,838,752
Net position - ending 85,021,611$ 31,856,061$ 116,877,672$
3
1
See notes to financial statements.
Net (Expense) Revenues
and Changes in Net Position
Functions/Programs
City of Crystal
Statement of Activities
Year Ended December 31, 2017
6.2
General Fund
EDA - Special
Revenue Debt Service
Assets
Cash and investments 7,308,936$ 3,190,635$ 5,282,301$
Temporarily restricted cash 72,020 - -
Taxes receivable 106,337 6,153 6,392
Special assessments receivable 52,675 - 13,216,478
Accounts receivable 57,645 - -
Accrued interest 36,217 - -
Due from other governments 115,217 2,039 -
Inventories 19,169 - -
Land held for resale - 699,000 -
Notes receivable - - -
Total assets 7,768,216$ 3,897,827$ 18,505,171$
Liabilities
Accounts payable 155,575$ 29,665$ -$
Due to other governments 159,290 - -
Salaries and benefits payable 238,673 3,541 -
Deposits payable 72,020 4,000 -
Contracts payable - 8,444 -
Unearned revenue 91,827 - -
Total liabilities 717,385 45,650 -
Deferred Inflows of Resources
State aid related deferred inflows of resources - - -
Unavailable revenue - property taxes 106,337 6,153 -
Unavailable revenue - special assessments 52,038 - 13,192,875
Unavailable revenue - notes receivable - - -
Total deferred inflows of resources 158,375 6,153 13,192,875
Fund Balances
Nonspendable 19,169 - -
Restricted - - 5,312,296
Committed 753,962 3,846,024 -
Assigned - - -
Unassigned 6,119,325 - -
Total fund balances 6,892,456 3,846,024 5,312,296
Total liabilities, deferred inflow of
resouces, and fund balances 7,768,216$ 3,897,827$ 18,505,171$
See notes to financial statements.32
City of Crystal
Balance Sheet - Governmental Funds
December 31, 2017
6.2
Capital
Improvement
Revolving -
Capital Projects
Street
Reconstruction -
Capital Projects
Police Equipment
Revolving -
Capital Projects
Other
Governmental
Funds
Total
Governmental
Funds
8,229,232$ 6,049,965$ 3,080,805$ 4,576,271$ 37,718,145$
- - - - 72,020
- 6,337 - 4,471 129,690
550,505 2,676,211 - 275,566 16,771,435
- - - 5,733 63,378
- - - - 36,217
- - - 12,949 130,205
- - - - 19,169
- - - - 699,000
32,690 - - - 32,690
8,812,427$ 8,732,513$ 3,080,805$ 4,874,990$ 55,671,949$
8,248$ 46,425$ 210,114$ 17,234$ 467,261$
10,237 - - 42,164 211,691
- - - - 242,214
- - - - 76,020
- 186,534 - - 194,978
- - - - 91,827
18,485 232,959 210,114 59,398 1,283,991
- 3,101,780 - - 3,101,780
- 6,337 - 4,471 123,298
549,303 2,672,445 - 274,956 16,741,617
32,690 - - - 32,690
581,993 5,780,562 - 279,427 19,999,385
- - - - 19,169
- - - 1,796,519 7,108,815
8,211,949 2,718,992 2,870,691 2,665,722 21,067,340
- - - 73,924 73,924
- - - - 6,119,325
8,211,949 2,718,992 2,870,691 4,536,165 34,388,573
8,812,427$ 8,732,513$ 3,080,805$ 4,874,990$ 55,671,949$
33
6.2
34
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6.2
City of Crystal
Reconciliation of the Balance Sheet to
the Statement of Net Position - Governmental Funds
December 31, 2017
Total fund balances - governmental funds 34,388,573$
Cost of capital assets 106,036,135
Less accumulated depreciation (46,433,070)
Certain revenues are include in net position but are excluded from fund balances
until they are available to liquidate liabilities of the current period.
Unavailable revenue relating to:
Property taxes 123,298
Special assessments 16,741,617
Notes receivable 32,690
Long-term liabilities are included in net position but are excluded from fund balances
until due and payable.
Bond principal payable (18,600,000)
Premium on debt (512,673)
Discount on debt 44,159
Interest payable (202,650)
Compensated absences payable (753,962)
Net OPEB obligation (627,533)
Governmental funds do not report long-term amounts relating to pensions.
Deferred outflows of resources and deferred inflows of resources are created
as a result of various differences related to pensions that are not recognized
in the governmental funds.
Deferred inflows of resources related to pensions (6,649,847)
Deferred outflows of resources related to pensions 6,135,231
Net pension liability (7,264,789)
An internal service fund is used by management to charge the costs of insurance
to individual funds. The assets and liabilities of the Self-Insurance Internal Service
Fund are included in governmental activities in the Statement of Net Position.874,353
Equity interests in underlying capital assets of joint ventures associated with
governmental funds are not reported in such funds because they do not represent
financial assets.
Equity interest in joint venture - West Metro Fire-Rescue District 1,690,079
Total net position - governmental activities 85,021,611$
See notes to financial statements.35
Amounts reported for governmental activities in the Statement of Net Position
are different because:
Capital assets used in governmental activities are not current financial
resources and, therefore, are not reported as assets in governmental funds.
6.2
General Fund
EDA - Special
Revenue Debt Service
Revenues
Property taxes 8,709,285$ 276,103$ 212,025$
Special assessments 59,331 - 2,094,566
Licenses and permits 785,451 - -
Intergovernmental 2,003,243 - -
Charges for services 758,968 100,119 -
Fine and forfeitures 325,172 - -
Interest 34,575 29,903 41,639
Miscellaneous 47,780 7,937 -
Total revenues 12,723,805 414,062 2,348,230
Expenditures
Current
General government 2,622,202 - -
Public safety 6,504,810 - -
Public works 1,285,172 - -
Culture and recreation 2,372,112 - -
Economic development 543,950 614,478 -
Debt service
Principal - - 1,880,000
Interest and other charges - - 426,068
Capital outlay - 168,876 -
Total expenditures 13,328,246 783,354 2,306,068
Excess of revenues over
(under) expenditures (604,441) (369,292) 42,162
Other Financing Sources (Uses)
Proceeds from sale of capital asset 833 - -
Bonds issued - - -
Premium on bonds issued - - -
Transfers in 445,475 - 474,064
Transfers out (3,186) - (954,272)
Total other financing
sources (uses)443,122 - (480,208)
Net change in fund
balances (161,319) (369,292) (438,046)
Fund Balances
Beginning of year 7,053,775 4,215,316 5,750,342
End of year 6,892,456$ 3,846,024$ 5,312,296$
See notes to financial statements.36
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances - Governmental Funds
Year Ended December 31, 2017
6.2
Capital
Improvement
Revolving -
Capital
Projects
Street
Reconstruction
- Capital
Projects
Police
Equipment
Revolving -
Capital
Projects
Other
Governmental
Funds
Total
Governmental
Funds
266,220$ -$ 137,400$ 968,143$ 10,569,176$
200,488 2,033,012 - 80,869 4,468,266
- - - - 785,451
239,674 830,255 - 60,470 3,133,642
- - - - 859,087
- - - 34,745 359,917
70,721 25,691 26,492 30,636 259,657
- 226,441 2,500 69,644 354,302
777,103 3,115,399 166,392 1,244,507 20,789,498
- - - 16,826 2,639,028
- - 28,329 56,096 6,589,235
- - - 169,902 1,455,074
- - - 7,420 2,379,532
- - - 120,890 1,279,318
- - - 88,341 1,968,341
- 74,171 - 51,228 551,467
1,060,448 8,135,122 396,579 68,597 9,829,622
1,060,448 8,209,293 424,908 579,300 26,691,617
(283,345) (5,093,894) (258,516) 665,207 (5,902,119)
69,405 - 20,876 - 91,114
- 4,665,000 - - 4,665,000
- 273,843 - - 273,843
68,000 741,589 - 215,869 1,944,997
- - - (584,478) (1,541,936)
137,405 5,680,432 20,876 (368,609) 5,433,018
(145,940) 586,538 (237,640) 296,598 (469,101)
8,357,889 2,132,454 3,108,331 4,239,567 34,857,674
8,211,949$ 2,718,992$ 2,870,691$ 4,536,165$ 34,388,573$
37
6.2
38
(THIS PAGE LEFT BLANK INTENTIONALLY)
6.2
City of Crystal
Reconciliation of the Statement of Revenues,
Expenditures, and Changes in Fund Balances to
Year Ended December 31, 2017
(469,101)$
Capital outlays are reported in governmental funds as expenditures. However, in the
Statement of Activities, the cost of those assets is allocated over the estimated useful
lives as depreciation expense.
Capital outlays 7,026,568
Depreciation expense (3,888,597)
Revenues relating to delinquent taxes, special assessments, and notes receivable are included
in the change in net position but are excluded from the net change in fund balances until they
are available to liquidate liabilities of the current period.1,810,111
The issuance of long-term debt provides current financial resources to governmental funds,
while repayment of the principal of long-term debt consumes the current financial resources
of governmental funds. Neither transaction, however, has any effect on net position. Also,
governmental funds report the effect of premiums, discounts, and similar items when debt is
first issued, whereas these amounts are deferred and amortized in the Statement of Activities.
Proceeds from bonds issued (4,665,000)
Premium on bonds issued (273,843)
Bond principal payments and adjustments 1,965,940
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.
Amortization of bond premium 39,075
Amortization of bond discount (5,576)
Accrued interest payable (23,951)
Compensated absences 63,798
Net OPEB obligation (72,949)
Pension costs in governmental funds are recognized when employer contributions are made.
On the Statement of Activities pension costs are recognized on the accrual basis. The
difference between actual employer contributions and accrual basis pension costs is reflected
in pension expense.
Pension expense (590,228)
An internal service fund is used by management to charge the costs of insurance to individual
funds. The change in net position of the Self-Insurance Internal Service Fund is included in
governmental activities in the Statement of Net Position.77,928
Net income (loss) from equity interests is included in the change in net position but is excluded
from the change in fund balances.(346,139)
Change in net position - governmental activities 648,036$
See notes to financial statements.39
Net change in fund balances - governmental funds
Amounts reported for governmental activities in the Statement of Activities are
different because:
the Statement of Activities - Governmental Funds
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual - General Fund
Year Ended December 31, 2017
Original Final Actual Amounts
Revenues
Property taxes 8,669,000$ 8,669,000$ 8,709,285$ 40,285$
Special assessments 114,900 114,900 59,331 (55,569)
Licenses and permits 836,256 836,256 785,451 (50,805)
Intergovernmental 1,973,909 1,973,909 2,003,243 29,334
Charges for services 765,677 765,677 758,968 (6,709)
Fine and forfeitures 326,000 326,000 325,172 (828)
Interest 60,000 60,000 34,575 (25,425)
Miscellaneous revenues 20,200 20,200 47,780 27,580
Total revenues 12,765,942 12,765,942 12,723,805 (42,137)
Expenditures
General government
Mayor and council 129,418 129,418 139,403 9,985
Administration 1,234,987 1,234,987 1,213,982 (21,005)
Human Resources 52,179 52,179 67,908 15,729
Assessing 267,224 267,224 274,927 7,703
Legal 97,000 97,000 53,704 (43,296)
Elections 12,715 12,715 15,936 3,221
Finance 589,523 589,523 622,635 33,112
City buildings 190,082 190,082 233,707 43,625
Total general government 2,573,128 2,573,128 2,622,202 49,074
Public safety
Police 5,057,200 5,057,200 5,184,702 127,502
Fire 1,300,110 1,300,110 1,320,108 19,998
Total fire 6,357,310 6,357,310 6,504,810 147,500
Public works
Engineering 395,773 395,773 381,536 (14,237)
Street maintenance 968,134 968,134 903,636 (64,498)
Total public works 1,363,907 1,363,907 1,285,172 (78,735)
Park and recreation
Park maintenance 823,150 823,150 783,716 (39,434)
Forestry 74,100 74,100 53,745 (20,355)
Recreation 770,361 770,361 896,906 126,545
Community center 425,244 425,244 387,030 (38,214)
Waterslide/swimming pool 264,403 264,403 250,715 (13,688)
Total parks and recreation 2,357,258 2,357,258 2,372,112 14,854
40
Variance with
Final Budget
Budgeted Amounts
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual - General Fund
Year Ended December 31, 2017
Original Final Actual Amounts
Expenditures (Continued)
Community development
Planning and code enforcement 83,178$ 83,178$ 81,630$ (1,548)$
Building inspection 276,980 276,980 277,913 933
Housing inspection 189,556 189,556 181,623 (7,933)
Health department 10,100 10,100 2,784 (7,316)
Total community development 559,814 559,814 543,950 (15,864)
Total expenditures 13,211,417 13,211,417 13,328,246 116,829
Excess of revenues
under expenditures (445,475) (445,475) (604,441) (158,966)
Other Financing Source
Proceeds from sale of capital asset - - 833 833
Transfers in 445,475 445,475 445,475 -
Transfers out - - (3,186) (3,186)
Total other financing
Sources (uses)445,475 445,475 443,122 (2,353)
Net change in fund balances -$ -$ (161,319) (161,319)$
Fund Balance
Beginning of year 7,053,775
End of year 6,892,456$
See notes to financial statements.41
Budgeted Amounts Variance with
Final Budget -
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual - EDA - Special Revenue
Year Ended December 31, 2017
Original Final Actual Amounts
Revenues
Property taxes 277,200$ 277,200$ 276,103$ (1,097)$
Charges for services 110,000 110,000 100,119 (9,881)
Investment income 36,000 36,000 29,903 (6,097)
Miscellaneous revenues - - 7,937 7,937
Total revenues 423,200 423,200 414,062 (9,138)
Expenditures
Current
Community development 360,304 360,304 614,478 254,174
Capital outlay 133,000 133,000 168,876 35,876
Total expenditures 493,304 493,304 783,354 290,050
Excess of revenues
under expenditures (70,104)$ (70,104)$ (369,292) (299,188)$
Fund Balance
Beginning of year 4,215,316
End of year 3,846,024$
See notes to financial statements.42
Budgeted Amounts Variance with
Final Budget
6.2
Governmental
Activities -
Internal Service
Fund
Water Sewer
Storm
Drainage Street Lights
Recycling
Utility Totals Self Insurance
Assets
Current assets
Cash and investments (including cash equivilants)953,039$ 2,121,076$ 787,914$ 488,501$ 120,021$ 4,470,551$ 898,302$
Special assessment receivable 373,116 - - - - 373,116 -
Accounts receivable 575,794 446,823 208,490 37,798 58,110 1,327,015 -
Accrued interest - - - - - - -
Due from other funds - 30,000 - 30,000 - 60,000 -
Due from other governments 25,588 - - - - 25,588 -
Inventories 26,812 27,574 3,108 - - 57,494 -
Prepaid expenses 520 520 260 - - 1,300 -
Total current assets 1,954,869 2,625,993 999,772 556,299 178,131 6,315,064 898,302
Noncurrent assets
Equity interest in joint venture 4,323,142 - - - - 4,323,142 -
Advance to other funds - 180,000 - 180,000 - 360,000 -
Capital assets
Land 42,200 - 716,862 - - 759,062 -
Infrastructure 3,108,306 8,065,020 13,660,412 627,483 - 25,461,221 -
Buildings 1,095,666 805,426 795,413 - - 2,696,505 -
Office equipment - - - 16,861 - 16,861 -
Software 57,324 23,573 23,573 - - 104,470 -
Equipment 2,212,430 1,067,847 700,869 - - 3,981,146 -
Vehicles 365,070 174,342 140,787 - - 680,199 -
Construction in progress 404,159 1,113,784 926,284 - - 2,444,227 -
Total capital assets 7,285,155 11,249,992 16,964,200 644,344 - 36,143,691 -
Less accumulated depreciation (2,770,302) (4,952,324) (5,872,920) (264,690) - (13,860,236) -
Net capital assets 4,514,853 6,297,668 11,091,280 379,654 - 22,283,455 -
Total noncurrent assets 8,837,995 6,477,668 11,091,280 559,654 - 26,966,597 -
Deferred Outflows of Resources
Pension-related deferred outflows 67,281 67,281 33,640 - - 168,202 -
Liabilities
Current liabilities
Accounts payable 16,040$ 3,540$ 6,124$ 9,857$ -$ 35,561$ 23,449$
Salaries and benefits payable 5,008 5,008 2,504 - - 12,520 -
Deposits payable 850 - - - - 850 -
Due to other funds 60,000 - - - - 60,000 -
Due to other governments 124,467 1,850 932 - - 127,249 500
Current compensated absences 12,410 12,410 6,205 - - 31,025 -
Total current liabilities 218,775 22,808 15,765 9,857 - 267,205 23,949
Noncurrent liabilities
Compensated absences 41,972 41,972 20,986 - - 104,930 -
Advances from other funds 360,000 - - - - 360,000 -
Net pension liability 268,689 268,689 134,344 - - 671,722 -
Net OPEB obligation 25,270 25,270 12,635 - - 63,175 -
Total noncurrent liabilities 695,931 335,931 167,965 - - 1,199,827 -
Deferred Inflows of Resources
Pension-related deferred inflows 50,708 50,708 25,354 - - 126,770 -
Net Position
Net investment in capital assets 4,514,853 6,297,668 11,091,280 379,654 - 22,283,455 -
Unrestricted 5,379,878 2,463,827 824,328 726,442 178,131 9,572,606 874,353
Total net position 9,894,731$ 8,761,495$ 11,915,608$ 1,106,096$ 178,131$ 31,856,061$ 874,353$
See notes to financial statements.43
Business-Type Activities - Enterprise Funds
City of Crystal
Statement of Net Position - Proprietary Funds
December 31, 2017
6.2
Water Sewer
Storm
Drainage Street Lights
Operating revenues
Charges for services 3,138,317$ 2,300,866$ 1,058,549$ 195,122$
Other charges 256,506 997 616 -
Miscellaneous - - - -
Total operating revenues 3,394,823 2,301,863 1,059,165 195,122
Operating expenses
Personal services 402,600 400,314 207,286 -
Other services 180,446 117,251 225,398 9,293
Supplies 55,120 57,672 16,500 -
Water purchases 2,096,087 - - -
Sewage disposal charges - 1,404,357 - -
Electric service - - - 112,969
Recycling charges - - - -
Depreciation 226,375 164,987 344,985 32,217
Insurance - - - -
Total operating expenses 2,960,628 2,144,581 794,169 154,479
Operating income (loss)434,195 157,282 264,996 40,643
Nonoperating revenues (expenses)
Interest income 6,143 22,917 3,737 8,535
Interest expense (9,600) - - -
Operating grants and contributions - - 145,460 -
Gain on sale of capital assets 9,964 - - -
Loss on disposition of capital assets - - (15,000) (20,000)
Net income (loss) from joint venture 277,161 - - -
Total nonoperating revenue (expenses)283,668 22,917 134,197 (11,465)
Income before capital contributions and transfers 717,863 180,199 399,193 29,178
Capital contributions 404,159 1,113,784 933,260 -
Transfers out (140,188) (140,188) (105,723) (10,657)
Change in net position 981,834 1,153,795 1,226,730 18,521
Net position
Beginning of year 8,912,897 7,607,700 10,688,878 1,087,575
End of year 9,894,731$ 8,761,495$ 11,915,608$ 1,106,096$
See notes to financial statements.44
City of Crystal
Statement of Revenues, Expenses, and Changes
in Net Position - Proprietary Funds
Year Ended December 31, 2017
6.2
Governmental
Activities -
Internal
Service Fund
Recycling
Utility Totals Self Insurance
340,250$ 7,033,104$ 214,181$
- 258,119 -
- - 21,469
340,250 7,291,223 235,650
- 1,010,200 -
319 532,707 -
- 129,292 -
- 2,096,087 -
- 1,404,357 -
- 112,969 -
324,534 324,534 -
- 768,564 -
- - 164,414
324,853 6,378,710 164,414
15,397 912,513 71,236
912 42,244 6,692
- (9,600) -
- 145,460 -
- 9,964 -
- (35,000) -
- 277,161 -
912 430,229 6,692
16,309 1,342,742 77,928
- 2,451,203 -
(6,305) (403,061) -
10,004 3,390,884 77,928
168,127 28,465,177 796,425
178,131$ 31,856,061$ 874,353$
45
6.2
Water Sewer Storm Drainage Street Lights
Cash Flows - Operating Activities
Receipts from customers and users 3,398,864$ 2,295,048$ 1,042,992$ 194,941$
Payments to suppliers (2,259,536) (1,558,509) (243,633) (122,664)
Payments to employees (375,394) (373,108) (193,684) -
Net cash flows - operating activities 763,934 363,431 605,675 72,277
Cash Flows - Noncapital
Financing Activities
Transfer to other funds (140,188) (140,188) (105,723) (10,657)
Net cash flows - noncapital
financing activities (140,188) (140,188) (105,723) (10,657)
Cash Flows - Capital and Related
Financing Activities
Change in advance to other funds - 30,000 - 30,000
Change in due to other funds (60,000) - - -
Change in assessments receivable (4,030) - - -
Interest paid on debt (9,600) - - -
Proceeds from disposal of capital assets 9,964 - - -
Grants and contributions - - 145,460 -
Acquisition of capital assets (52,353) (470,343) (241,202) -
Net cash flows - capital and related
financing activities (116,019) (440,343) (95,742) 30,000
Cash Flows - Investing Activities
Interest and dividends received 6,713 25,733 4,136 9,150
Net change in cash and cash equivalents 514,440 (191,367) 408,346 100,770
Cash and cash equivalents, January 1 438,599 2,312,443 379,568 387,731
Cash and cash equivalents, December 31 953,039$ 2,121,076$ 787,914$ 488,501$
Reconciliation of Operating
Income (Loss) to Net Cash
Flows - Operating Activities
Operating income (loss)434,195$ 157,282$ 264,996$ 40,643$
Adjustments to reconcile operating
income (loss) to net cash flows -
operating activities
Depreciation expense 226,375 164,987 344,985 32,217
Accounts receivable 27,768 (6,815) (42,060) (302)
Due from other governments (23,727) - 25,887 121
Inventory 424 20,905 (774) -
Accounts payable 13,592 (281) (1,042) (402)
Due to other governmental units 57,251 147 81 -
Salaries payable (1,059) (1,059) (530) -
Deposits payable 850 - - -
OPEB payable 2,639 2,639 1,319 -
Pension related activity 23,245 23,245 11,622 -
Compensated absences payable 2,381 2,381 1,191 -
Total adjustments 329,739 206,149 340,679 31,634
Net cash flows -
operating activities 763,934$ 363,431$ 605,675$ 72,277$
Noncash Capital and Related
Financing Activities
Capital assets contributed by other
funds and developers 404,159$ 1,113,784$ 933,260$ -$
Net income (loss) from joint venture 277,161$ -$ -$ -$
See notes to financial statements.46
City of Crystal
Statement of Cash Flows - Proprietary Funds
Year Ended December 31, 2017
6.2
Recycling
Utility Totals Self Insurance
340,818$ 7,272,663$ 235,650$
(324,853) (4,509,195) (305,766)
- (942,186) -
15,965 1,821,282 (70,116)
(6,305) (403,061) -
(6,305) (403,061) -
- 60,000 -
- (60,000) -
- (4,030) -
- (9,600) -
- 9,964 -
- 145,460 -
- (763,898) -
- (622,104) -
1,047 46,779 7,869
10,707 842,896 (62,247)
109,314 3,627,655 960,549
120,021$ 4,470,551$ 898,302$
15,397$ 912,513$ 71,236$
- 768,564 -
568 (20,841) -
- 2,281 -
- 20,555 -
- 11,867 (140,362)
- 57,479 (990)
- (2,648) -
- 850 -
- 6,597 -
- 58,112 -
- 5,953 -
568 908,769 (141,352)
15,965$ 1,821,282$ (70,116)$
-$ 2,451,203$ -$
-$ 277,161$ -$
47
6.2
Hennepin
Recycling Group
Agency Fund
Assets
Current
Cash and investments
(including cash equivalents)1,399,536$
Due from other governments 92,909
Total assets 1,492,445$
Liabilities
Accounts payable $ 49,991
Due to other governments 1,442,454
Total liabilities 1,492,445$
See notes to financial statements.48
City of Crystal
Statement of Fiduciary Net Position
December 31, 2017
6.2
49
City of Crystal
Notes to Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
The City of Crystal (the City) operates under the Home Rule Charter form of government in accordance
with applicable State of Minnesota Statutes. The charter prescribes a Council-Manager form of
organization. The governing body consists of a seven-member City Council elected at large to serve
four-year staggered terms.
The accompanying financial statements present the activities of the government. Certain organizations
have been defined in accordance with GASB Statement No. 14 and are presented in this report as
follows:
1. Blended Component Units
Blended component units, although legally separate entities, are, in substance, part of the
government's operations. The City has one blended component unit which is reported as if it were
part of the City.
The Economic Development Authority (EDA), in and for the City, was created by the City to provide
housing and redevelopment assistance through the administration of various programs. It levies taxes
to provide funds for redevelopment in the City.
Although the EDA is legally separate from the City, it is reported as if it were part of the primary
government. Its governing board is comprised of the City Council members and the City has
operational responsibility of the EDA, meaning it manages the EDA's activities in essentially the
same manner in which it manages its own programs and departments. The EDA is reported as a
special revenue fund. It does not issue a separate set of financial statements.
2. Joint Ventures
A joint venture is a legal entity or other organization that results from a contractual agreement and
that is owned, operated, or governed by two or more participants as a separate and specific activity
subject to joint control. The participants retain either an ongoing financial interest or an ongoing
financial responsibility. The City participates in two joint ventures – the Golden Valley, Crystal,
New Hope Joint Water Commission, and the West Metro Fire-Rescue District. Descriptions and
other financial information for these organizations are included in the note entitled Joint Ventures
and Jointly Governed Organizations.
3. Jointly Governed Organizations
The City has several agreements with governmental and other entities that provide reduced costs,
better service, and additional benefits to participants. The various programs in which the City
participates in are described in the note entitled Joint Ventures and Jointly Governed Organizations.
B. Government-Wide and Fund Financial Statements
The government-wide financial statements (i.e. the Statement of Net Position and the Statement of
Activities) report information on all of the non-fiduciary activities of the primary government and its
component units. Governmental activities, which normally are supported by taxes and intergovernmental
revenues, are reported separately from business-type activities, which rely to a significant extent on
charges for sales and/or services and fees.
6.2
50
City of Crystal
Notes to Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
B. Government-Wide and Fund Financial Statements (Continued)
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. Aggregated information for the remaining nonmajor governmental funds is
reported in a single column in the fund financial statements.
The Statement of Activities demonstrates the degree to which the direct expenses of a given function or
segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a
specific function or segment. The City does not allocate indirect expenses. Program revenues include 1)
charges to customers or applicants who purchase, use, or directly benefit from goods, services, or
privileges provided by a given function or segment, 2) operating grants and contributions restricted to
meeting the operational requirements of a particular function, and 3) capital grants and contributions
restricted to meeting the capital requirements of a particular function, including special assessments.
Internally dedicated resources are reported as general revenues rather than as program revenues.
Likewise, general revenues include all taxes.
As a general rule, the effect of interfund activity has been eliminated from the government-wide
financial statements. However, charges between the City's enterprise funds and other functions (i.e.
interfund services provided and used) are not eliminated, as that would distort the direct costs and
program revenues reported in those functions. Depreciation expense is included in the direct expenses of
each function. Interest on long-term debt is considered an indirect expense and is reported separately
under governmental activities on the Statement of Activities.
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources measurement
focus and the accrual basis 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 the
provider have been met.
Governmental fund financial statements are reported using the current financial resources measurement
focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both
measurable and available. "Measurable" means the amount of the transaction can be determined and
"available" means collectible within the current period or soon enough thereafter to be used to pay
liabilities of the current period.
For this purpose, the City considers revenues to be available if they are collected within 60 days after
year-end. Major revenues susceptible to accrual include property taxes, special assessments,
intergovernmental revenues, charges for services, and investment earnings. Major revenues not
susceptible to accrual include licenses, permits, inspection fees, and miscellaneous revenues. Such
revenues are recorded only as received because they are not measurable until collected. Issuance of
bonds and proceeds from sale of property and equipment are reported as other financing sources.
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City of Crystal
Notes to Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation (Continued)
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.
Proprietary funds distinguish operating revenues and expenses from non-operating 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 enterprise funds and of the government's internal service fund are charges to customers for sales and
services. Operating expenses for enterprise funds and the internal service fund 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 non-operating revenues and expenses.
The City's fiduciary funds include an agency fund. Agency funds are custodial in nature (assets equal
liabilities), do not involve measurement of results of operations, and use accrual accounting.
When both restricted and unrestricted resources are available for use, it is the government's policy to use
restricted resources first, then unrestricted resources as they are needed.
Description of Funds:
The government reports the following major governmental funds:
General Fund – This is 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.
EDA – Special Revenue – This blended component unit is used to account for the City's housing and
redevelopment activities. Significant revenue sources include property taxes, intergovernmental
revenues, and charges for sales.
Debt Service – This fund accounts for resources accumulated, and payments made, for principal and
interest on long-term general obligation debt and tax increment revenue notes of governmental
funds.
Capital Improvement Revolving – Capital Projects – This fund is used to account for the majority of
the City's capital acquisitions and improvements, as they relate to operations of the City.
Street Reconstruction – Capital Projects – This fund is used to account for ongoing street
reconstruction projects in the City. The City has been divided into a total of sixteen reconstruction
phases.
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City of Crystal
Notes to Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation (Continued)
Police Equipment Revolving – Capital Projects - This fund is used to account for capital acquisitions
of the City's police department. The fund was initially funded by a 1999 refund of the City's
proportionate share of residual assets in the overfunded PERA police consolidation account, which
was merged with the PERA Police and Fire Fund. Financing sources may include property taxes,
grants, interest, and proceeds from sale of equipment.
The government reports the following major proprietary funds:
Water – This fund accounts for the provision of water to residents and customers of the City. The
cities of Crystal, Golden Valley, and New Hope established a joint water commission in 1963 to
provide for the creation and maintenance of a joint water supply, storage, and distribution system
through which water purchased from the City of Minneapolis can be supplied to the population of
the member cities.
Sanitary Sewer – This fund accounts for the collection and pumping of sanitary sewage through a
system of sewer lines and lift stations. Sewage is treated by Metropolitan Council Environmental
Services (MCES).
Storm Drainage – This fund accounts for the operation, maintenance, and improvement of the City's
storm drainage system.
Street Lights – This fund accounts for the operation, maintenance, and improvement of the City's
street lights.
Recycling – This fund accounts for the provision of recycling services to residents and customers of
the City. Recycling services are provided by Hennepin Recycling Group (HRG).
Additionally, the government reports the following fund types:
An Internal Service Fund is used to account, on a cost-reimbursement basis, for the financing of
uninsured risks of loss (self-insurance). Charges are made to various funds of the City to recoup
insurance premiums and claims paid.
The Agency Fund accounts for the collection, recycling, and disposal of solid waste activities of
Hennepin Recycling Group (HRG), a jointly-governed organization in which the City participates.
D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position or Equity
1. Deposits and Investments
The City's cash and cash equivalents are considered to be change funds, demand deposits, and short-term
investments with original maturities of three months or less from the date of acquisition.
6.2
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City of Crystal
Notes to Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position or Equity
(Continued)
1. Deposits and Investments (Continued)
Cash balances from all funds are combined and invested to the extent available in authorized
investments (refer to note entitled Deposits and Investments). Earnings from such investments are
allocated to respective funds on the basis of applicable cash balance participation by each fund.
Certain investments for the City are reported at fair value as disclosed in Note 2. The City
categorizes its fair value measurements within the fair value hierarchy established by generally
accepted accounting principles. The Hierarchy is based on the valuation inputs used to measure the
fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2
inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs.
In accordance with GASB Statement No. 79, the Minnesota Municipal Investment Pool securities are
valued at amortized cost, which approximates fair value. There are no restrictions or limitations on
withdrawals from the 4M Liquid Asset Fund. Investments in the 4M Plus must be deposited for a
minimum of 14 calendar days. Withdrawals prior to the 14-day restriction period will be subject to a
penalty equal to seven days interest on the amount withdrawn. Seven days' notice of redemption is
required for withdrawals of investments in the 4M Term Series withdrawn prior to the maturity date
of that series. A penalty could be assessed as necessary to recoup the Series for any charges, losses,
and other costs attributable to the early redemption.
2. Temporarily Restricted Cash
A portion of Cash is reported as temporarily restricted in an amount equal to the balance reported in
Deposits Payable of the General Fund. The amount represents funds collected as surety on site
improvements in progress within the City. Once site improvements have been satisfactorily completed in
accordance with terms of individual agreements, individual amounts will be released.
3. Receivables
All utility and miscellaneous accounts receivable are reported gross. Since most uncollectible
accounts are able to be certified to Hennepin County for collection with property taxes, no allowance
for uncollectible accounts has been provided.
4. Property Taxes
Property tax levies are set by the City Council in December of each year and are certified to Hennepin
County for collection in the following year. In Minnesota, counties act as collection agents for all
property taxes.
The County spreads all levies over taxable property. Such taxes become a lien on January 1. Revenues
are accrued and recognized in the year collectible, net of delinquencies.
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City of Crystal
Notes to Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position or Equity
(Continued)
4. Property Taxes (Continued)
Real property taxes may be paid by taxpayers in two equal installments by May 15 and October 15 of
each year. Personal property taxes may be paid by February 28 and June 30 of each year. The County
provides tax settlements to cities and other taxing districts three times a year – in July, December,
and January of the following year.
In the fund financial statements, taxes that remain unpaid at December 31 are classified as delinquent
taxes receivable. They are fully offset by a deferred inflow of resources because they are not known
to be available to finance current expenditures.
5. Special Assessments
In accordance with state statutes, special assessments are levied against benefited properties for the
assessable costs of improvement projects. The City normally adopts an assessment roll at the time an
individual project is started. Assessments are collectible over a term of years generally consistent
with the term of years of the related bond issue. The County handles collection of annual
installments, including interest, in the same manner as property taxes. Property owners are allowed
to prepay total future installments without interest or prepayment penalties.
In the fund financial statements, special assessments receivable include the following components,
and are offset by a deferred inflow of resources:
• Delinquent – amounts billed to property owners but not yet paid
• Deferred – installments that will be billed to property owners in future years.
6. Inventories
Fuel inventory recorded in the General Fund and parts inventories recorded in the enterprise funds
are valued at cost using the first-in/first-out (FIFO) method. The cost of inventories is recorded using
the consumption method, where costs are recorded as expenditures/expenses when consumed rather
than when purchased.
7. Prepaid Items
Prepaid items in the government-wide and fund financial statements reflect costs paid to vendors that
are applicable to future accounting periods. The cost of prepaid items is recorded using the
consumption method, where costs are recorded as expenditures when consumed rather than when
purchased.
8. Land Held for Resale
The Crystal EDA acquires properties for redevelopment purposes. Land held for resale is reported as
an asset at its net realizable value in the EDA Special Revenue Fund. Any costs incurred that are
above a property's net realizable value are reported as expenditures of the current period.
6.2
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City of Crystal
Notes to Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position or Equity
(Continued)
9. Interfund Receivables and Payables
Activities between funds that are representative of lending and borrowing arrangements are referred
to at year-end as advances to/from other funds. The current and noncurrent portions are reported on
the Statement of Fund Net Position for the proprietary funds.
All other outstanding balances between funds are reported as due to/from other funds.
10. Capital Assets
Capital assets, both tangible and intangible, which include land, buildings, and structures,
improvements other than buildings, machinery and equipment, office equipment and furnishings,
software, vehicles and trailers, and infrastructure (utility systems, traffic and transportation systems,
and park systems) are reported in the applicable governmental or business-type activities columns in
the government-wide financial statements.
With the initial capitalization of infrastructure assets of governmental activities, as required by the
implementation of GASB Statement No. 34, the City chose to include all such items, regardless of
acquisition date. Historical costs were available from an independent, city-wide asset valuation that
had been completed in 1992, as well as from contractor invoices for street reconstruction projects
completed subsequent to 1992.
Tangible and intangible capital assets are defined by the City as assets with an initial, individual cost
of more than $5,000 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 acquisition value at the date of donation.
The costs of normal maintenance and repairs that do not add to the value of assets or materially
extend asset lives are not capitalized. Interest is not being capitalized on construction projects.
Tangible and intangible capital assets of the City are depreciated using the straight-line, mid-month
convention. In instances in which estimated useful lives have been revised to more closely
approximate historical experience, depreciation is calculated by taking the net remaining value over
the remaining life (prospectively). Estimated useful lives are as follows:
Years
Buildings and structures 5-50
Improvements other than buildings 5-40
Machinery and equipment 5-30
Office equipment and furnishings 5-20
Software 5
Vehicles and trailers 3-12
Infrastructure
Utility systems 25-75
Traffic and transportation systems 10-30
Park systems 15-20
Classification
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City of Crystal
Notes to Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position or Equity
(Continued)
11. Fund Balance Classifications
In the fund financial statements, governmental funds report fund balance in classifications that
disclose constraints for which amounts in those funds can be spent. Classifications of fund balance
that will be used are as follows:
• Nonspendable – These are resources that cannot be spent because they are either not readily
convertible to cash or are legally or contractually required to be maintained intact. Examples
include money held in escrow, prepaid amounts, land held for resale, and long-term loans or
notes receivable.
• Restricted – These are resources whose spending is constrained externally by creditors or by laws
and regulations of another government. Examples include grants, intergovernmental revenues,
and resources in debt service funds that include a legally enforceable requirement that those
resources be spent only for specific purposes.
• Committed – These are resources that can only be used for specific purposes established by the
City Council. Establishment of these specific purposes must be done by a resolution adopted by
the City Council and may only be changed or removed by a resolution adopted by the City
Council.
• Assigned – These are resources that the City intends to be used for specific purposes but are
neither restricted nor committed. Assigned fund balances are established by a motion of the City
Council. The City Council may also delegate this authority to the City Manager, who may act
upon recommendation of the Finance Director.
• Unassigned – These are resources that are available for any purpose of the fund. Amounts
identified as cash flow resources are classified as unassigned. Only the General Fund may have a
positive unassigned fund balance. A deficit fund balance in any fund must be classified as an
unassigned fund balance.
When multiple classifications of resources are available for use, it is the City's policy to first use
restricted resources if permitted, then committed, assigned, or unassigned resources. It is the City's
policy to retain in fund balance resources that have the lowest level of constraints possible.
The City Council has formally adopted a policy regarding the minimum unassigned fund balance for
the General Fund. The most significant revenue source of the General Fund is property taxes. This
revenue source is received in two installments during the year – July and December. As such, it is the
City's goal to begin each fiscal year with sufficient cash flow reserves to fund operations between
each semi-annual receipt of property taxes.
6.2
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City of Crystal
Notes to Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. Assets, Liability, Deferred Outflows/Inflows of Resources, and Net Position or Equity
(Continued)
11. Fund Balance Classifications (Continued)
The policy states that when fund balance at the end of a year exceeds non-spendable fund balance,
restricted fund balance, liability for compensated absences of employees, assigned fund balance, and
45% of the subsequent year's budget, the City Council shall consider transferring at least 25% of the
excess fund balance to one of the capital project funds. At any time during the year the City Council
may consider transferring any or all of the excess fund balance to any other fund of the City, as
needed.
12. Compensated Absences
The City compensates all employees for unused vacation hours upon termination. Eligible employees
are compensated for accrued compensatory hours upon termination. Employees terminating their
employment with the City after ten or more continuous years of service are compensated for 40% of
their accumulated sick leave hours at their current base hourly rate of pay. The maximum amount of
accrued sick leave hours that may be converted is 960.
Accumulated or vested vacation, compensatory, and sick time estimated to be payable as termination
pay is accrued as 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.
13. Long-Term Obligations
In the government-wide financial statements and in the proprietary fund types in 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
Position. Bond premiums and discounts are deferred and amortized over the life of bonds using the
straight-line method. Bonds payable are reported net of the applicable bond premium or discount.
Debt issuance costs are recognized as expense in the period incurred.
In the fund financial statements, governmental fund types recognize bond premiums, discounts, and
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.
6.2
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City of Crystal
Notes to Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position or Equity
(Continued)
14. Deferred Outflows of Resources
In addition to assets, the statement of financial position will sometimes report a separate section for
deferred outflows of resources. This separate financial statement element represents a consumption
of net position that applies to a future period(s) and so will not be recognized as an outflow of
resources (expense/expenditure) until that time. The City has one item that qualifies for reporting in
this category. Pension-related deferred outflows of resources are reported on the Statement(s) of Net
Position. Pension-related deferred outflows of resources result from the net effect of the change in
proportionate share and employer contributions paid to the Public Employees Retirement
Association of Minnesota (PERA) subsequent to the measurement date.
15. Deferred Inflows of Resources
In addition to liabilities, the statement of financial position and fund financial statements will
sometimes report a separate section for deferred inflows of resources. This separate financial
statement element represents an acquisition of net position that applies to a future period(s) and so
will not be recognized as an inflow of resources (revenue) until that time.
The City has three items that qualify for reporting in this category: 1) The City presents deferred
inflows of resources on the Governmental Fund Balance Sheet as unavailable revenue. The
governmental funds report unavailable revenues from three sources, including property taxes, special
assessments, and notes receivable. These amounts are deferred and recognized as an inflow of
resources in the period that the amounts become available. 2) The City presents deferred inflows of
resources on the Statement(s) of Net Position for pension-related deferred inflows of resources.
Pension-related deferred inflows of resources result from the net difference between projected and
actual earnings on plan investments for the Public Employees Retirement Association of Minnesota
(PERA). 3) At the fund level and government-wide level, grants received for subsequent years are
presented as deferred inflows of resources.
16. Pensions
For purposes of measuring the net pension liability, deferred outflows/inflows of resources, and
pension expense, information about the fiduciary net position of the Public Employees Retirement
Association of Minnesota (PERA) and additions to/deductions from PERA's fiduciary net position
have been determined on the same basis as they are reported by PERA, except that PERA's fiscal
year end is June 30. For this purpose, plan contributions are recognized as of employer payroll paid
dates and benefit payments and refunds are recognized when due and payable in accordance with the
benefit terms. Investments are reported at fair value.
17. Statement of Cash Flows
For purpose of the Statement of Cash Flows, the City considers all highly liquid debt instruments
with an original maturity from the time of purchase by the City of three months or less to be cash
equivalents. The proprietary fund's equity in the government-wide cash and investment management
pool is considered to be cash equivalents.
6.2
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City of Crystal
Notes to Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position or Equity
(Continued)
18. Budgets and Budgetary Accounting
The City follows these procedures in establishing the budgetary data reflected in the financial
statements:
• Prior to each September 15, the City Manager submits to the City Council proposed operating
budgets for the fiscal year commencing the following January. The operating budgets include
proposed expenditures and the means of financing them.
• In November, the County mails individual property tax notices to residents showing the taxes
that would result from the proposed budgets of all taxing units within the City.
• Prior to proposed budgets being approved, public hearings are conducted to obtain taxpayer
comments.
• In December, final budgets are legally enacted by the City Council through passage of a
resolution.
• During the budget year, the City Council must authorize any transfer of budgeted amounts
between departments within the General Fund. City management may authorize a transfer of
budgeted amounts within individual departments without obtaining approval from the City
Council.
• Supplemental appropriations during the year may only be made by the City Council. These
amounts must be financed by funds from the contingency reserve set up in the General Fund
or by additional revenues.
• All budget amounts lapse at the end of the year to the extent they have not been expended.
• Budgets are adopted on a basis consistent with accounting principles generally accepted in
the United States of America. Annual appropriated budgets are adopted for all governmental
funds. The budgets are adopted on a modified accrual basis.
• Budgets are adopted on an accrual basis for all enterprise and internal service funds.
• Budgetary control is maintained at the department level for the General Fund and at the fund
level for all other funds that adopt annual budgets. City management must request approval
from the City Council before exceeding budget at the applicable level.
6.2
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City of Crystal
Notes to Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position or Equity
(Continued)
19. Net Position
Net position represents the difference between assets and deferred outflows of resources and
liabilities and deferred inflows of resources in the government-wide financial statements. The net
investment in capital assets portion of net position consists of capital assets, net of accumulated
depreciation, reduced by the outstanding balance of any long-term debt used to build or acquire the
capital assets. Net position are reported as restricted in the government-wide financial statements
when there are limitations imposed on their use through external restrictions imposed by creditors,
grantors, or laws or regulations of other governments.
20. Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted
in the United States of America requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements. Estimates also affect the reported amounts of revenue and
expenditures/expense during the reporting period. Actual results could differ from those estimates.
NOTE 2 – DEPOSITS AND INVESTMENTS
A. Deposits
In accordance with Minnesota Statutes, the City maintains deposits at national or state banks within the
state, as authorized by the City Council. The following is considered to be the most significant risk
associated with deposits:
Custodial credit risk – In the case of deposits, this is the risk that in the event of a bank failure, the
deposits may be lost.
Minnesota Statutes require that all City deposits be protected by federal deposit insurance, corporate
surety bond, or collateral. The market value of collateral pledged must equal 110% of the deposits not
covered by federal deposit insurance or corporate surety bonds. Authorized collateral includes treasury
bills, notes, and bonds; issues of U.S. government agencies; general obligations rated "A" or better;
revenue obligations rated "AA" or better; irrevocable standard letters of credit issued by the Federal
Home Loan Bank; and certificates of deposit. Minnesota Statutes require that securities pledged as
collateral be held in safekeeping in a restricted account at the Federal Reserve Bank or in an account at a
trust department of a commercial bank or other financial institution that is not owned or controlled by
the financial institution furnishing the collateral. During the year, all deposits and investments were
collateralized in accordance with these provisions. The City has no additional deposit policies addressing
custodial credit risk for deposits.
At year-end, the City's carrying amount of deposits was $656,057 and the bank balance was $984,593.
All of the bank balance was covered by FDIC insurance or collateralized by pledged collateral held in
the City's name at the Federal Reserve Bank.
6.2
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City of Crystal
Notes to Financial Statements
NOTE 2 – DEPOSITS AND INVESTMENTS (CONTINUED)
A. Deposits (Continued)
The City's policy is to comply with Minnesota Statutes, which require that all deposits be protected by
federal deposit insurance, corporate surety bond, or collateral. The market value of collateral pledged
must equal 110% of the deposits not covered by federal deposit insurance or corporate surety bonds.
Minnesota Statutes require that securities pledged as collateral be held in safekeeping by the City
Treasurer or in a financial institution other than that furnishing the collateral.
B. Investments
The City has a formal investment policy to establish guidelines for the prudent investment of City funds.
Funds of the City will be invested in compliance with the provisions of Minnesota Statutes Chapter
118A. Allowable investments include the following:
• Bonds, notes, bills, mortgages, and other securities that are direct obligations or are guaranteed or
insured issues of the United States, its agencies, instrumentalities, or organizations created by
Congress.
• State and local securities, including:
o any security that is a general obligation of any state or local government with taxing powers and
is rated "A" or better by a national bond rating agency
o any security that is a revenue obligation of any state or local government with taxing powers and
is rated "AA" or better by a national bond rating agency
• Commercial paper issued by United States corporations or their Canadian subsidiaries that is rated in
the highest quality category by at least two nationally recognized rating agencies and that matures in
270 days or less.
• Time deposits that are fully insured by the Federal Depository Insurance Corporation.
• Bankers' acceptances of United States banks.
• Money market mutual funds.
• Government investment pools, including the Minnesota Municipal Money Market Fund.
As of December 31, 2017, the City had the following investments and maturities:
Fair Less than Greater than
Value One Year 1-5 Years 6-10 Years 10 Years
Brokered certificates of deposit 13,364,552$ 4,007,822$ 9,356,730$ -$ -$
Government securities 4,703,792 - 4,703,792 - -
State & local govt. bonds 2,150,184 1,748,017 402,167 - -
Money market accounts 23,682,225 23,682,225 - - -
Total 43,900,753$ 29,438,064$ 14,462,689$ -$ -$
Investment Maturities
Investment Type
6.2
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City of Crystal
Notes to Financial Statements
NOTE 2 – DEPOSITS AND INVESTMENTS (CONTINUED)
B. Investments (Continued)
Interest Rate Risk - This is the risk of potential variability in the fair value of fixed rate investments
resulting from changes in interest rates (the longer the period for which an interest rate is fixed, the
greater the risk). The City's investment policy states that "the City will minimize Interest Rate Risk by
structuring the investment portfolio so that securities mature to meet cash requirements for ongoing
operations."
Credit Risk – This is the risk that an issuer or other counterparty to an investment will not fulfill its
obligations. This risk is addressed by confining investments to those securities specifically authorized by
state statute and the City's investment policy. As of December 31, 2017, the City's investments in U.S.
Agencies were rated AA+ by Standard and Poor's and Aaa by Moody's Investors Service. The City's
investments in G.O. state and local government bonds were rated A2 or better by Moody's and A or
better by Standard and Poor's. The City's investments in state and local government revenue bonds were
rated Aa3 or better by Moody's and AA- or better by Standard and Poor's. The City's investments in
certificates of deposit were covered by FDIC insurance.
Custodial Credit Risk – For investments, this is the risk that in the event of a failure of the counterparty
to an investment transaction (typically a broker-dealer) the City would not be able to recover the value of
its investments that are in the possession of an outside party. The City's investment policy states that the
bank or broker is required to have insurance through FDIC and SIPC or transfer the security to a
custodian bank.
Concentration of Credit Risk – This is the risk associated with investing a significant portion of the
City's investments (considered to be 5% or more) in the securities of a single issuer. The City's
investment policy does not limit investments in any one issuer. At December 31, 2017, no investment
exceeded 5% of the City's total investments.
The City has the following recurring fair value measurements as of December 31, 2017:
• $20,218,527 of investments are valued using a matrix pricing model (Level 2 inputs)
6.2
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City of Crystal
Notes to Financial Statements
NOTE 2 – DEPOSITS AND INVESTMENTS (CONTINUED)
B. Investments (Continued)
The following summary reconciles cash and investments to the financial statements:
Cash on hand 1,744$
Carrying amount of deposits 656,057
Carrying amount of investments 43,900,753
44,558,554$
Total cash and investments
Per Statement of Net Position
Cash and investments 43,086,998$
Temporarily restricted cash 72,020
Per Statement of Changes in Assets and Liabilities
Agency Fund: Hennepin Recycling Group
Cash and investments 1,399,536
44,558,554$
NOTE 3 – INTERFUND RECEIVABLES AND PAYABLES
Advances to/from Other Funds
Balances as of December 31, 2017, are as follows:
Original Amount Due Within
Receivable Fund Payable Fund Amount Outstanding One Year
Sanitary Sewer Water 300,000$ 210,000$ 30,000$
Street Lights Water 300,000 210,000 30,000
600,000$ 420,000$ 60,000$
Amounts payable to the Sanitary Sewer and Street Lights funds relate to loans made to help pay for the
City's share of three new emergency water supply wells. The wells will be owned by the Joint Water
Commission (refer to Note 15). The City's share of the total cost will be approximately $1,200,000. The
Water Fund has sufficient resources to pay for half of the project and the interfund loans will provide
cash for the balance. Interest at the rate of 2% will be paid on the loans over a ten-year period, from
2015-2024. To provide the Water Fund with revenue to replenish its cash reserves and repay the loans, a
charge for service of $0.21/thousand gallons of water used has been approved and implemented.
6.2
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City of Crystal
Notes to Financial Statements
NOTE 4 – INTERFUND TRANSFERS
Interfund transfers for the year ended December 31, 2017, are as follows:
Capital Non-major
Improvement Street Debt Governmental
General Revolving Reconstruction Service Funds Total
Transfers Out
General -$ -$ - - 3,186$ 3,186$
Debt service - - 741,589 - 212,683 954,272
Non-major governmental funds 110,414 - - 474,064 - 584,478
Water 140,188 - - - - 140,188
Sanitary sewer 140,188 - - - - 140,188
Storm drainage 37,723 68,000 - - - 105,723
Street lights 10,657 - - - - 10,657
Recycling 6,305 - - - - 6,305
Total 445,475$ 68,000$ 741,589 474,064 215,869$ 1,944,997$
Transfers In
Transfers are used to 1) move revenues from the fund that statute or budget requires to collect them to
the fund that statute or budget requires to expend them, 2) move receipts restricted to debt service from
the funds collecting the receipts to the Debt Service Fund as debt service payments become due, 3) close
funds, and 4) use unrestricted revenues collected in the General Fund to finance various programs
accounted for in other funds, in accordance with budgetary authorizations.
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City of Crystal
Notes to Financial Statements
NOTE 5 – CAPITAL ASSETS
Capital asset activity for the year ended December 31, 2017, was as follows:
Beginning Ending
Balance Increases Decreases Balance
Governmental activities
Capital assets not being depreciated
Land 6,860,536$ -$ -$ 6,860,536$
Construction in progress 4,055,310 6,010,855 (5,583,983) 4,482,182
Total capital assets
not being depreciated 10,915,846 6,010,855 (5,583,983) 11,342,718
Capital assets being depreciated
Buildings and structures 17,210,780 236,032 - 17,446,812
Improvements other than buildings 5,938,756 17,723 - 5,956,479
Machinery and equipment 3,913,694 209,139 (207,693) 3,915,140
Office equipment and furnishings 791,897 52,122 - 844,019
Software 199,039 - - 199,039
Vehicles and trailers 2,595,215 310,424 (142,169) 2,763,470
Traffic and transportation systems 57,593,835 5,774,256 - 63,368,091
Park systems 200,367 - - 200,367
Total capital assets
being depreciated 88,443,583 6,599,696 (349,862) 94,693,417
Less accumulated depreciation for
Buildings and structures (7,151,695) (524,755) - (7,676,450)
Improvements other than buildings (3,134,322) (198,048) - (3,332,370)
Machinery and equipment (2,326,066) (227,752) 207,693 (2,346,125)
Office equipment and furnishings (351,546) (75,859) - (427,405)
Software (102,076) (39,808) - (141,884)
Vehicles and trailers (1,478,513) (290,072) 142,169 (1,626,416)
Traffic and transportation systems (28,232,205) (2,522,000) - (30,754,205)
Park systems (117,912) (10,303) - (128,215)
Total accumulated
depreciation (42,894,335) (3,888,597) 349,862 (46,433,070)
Total capital assets being
depreciated, net 45,549,248 2,711,099 - 48,260,347
Governmental activities capital
position, net 56,465,094$ 8,721,954$ (5,583,983)$ 59,603,065$
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City of Crystal
Notes to Financial Statements
NOTE 5 – CAPITAL ASSETS (CONTINUED)
Capital asset activity for the year ended December 31, 2017, was as follows:
Beginning Ending
Balance Increases Decreases Balance
Business-type activities
Capital assets not being depreciated
Land 759,062$ -$ -$ 759,062$
Improvements other than buildings 187,246 - - 187,246
Construction in progress 764,042 2,451,203 (771,018) 2,444,227
Total capital assets not
being depreciated 1,710,350 2,451,203 (771,018) 3,390,535
Capital assets being depreciated
Buildings and structures 2,696,505 - - 2,696,505
Improvements other than buildings 16,861 - - 16,861
Machinery and equipment 3,304,971 694,048 (17,873) 3,981,146
Software 104,470 - - 104,470
Vehicles and trailers 627,846 52,353 - 680,199
Utility systems 23,910,474 - - 23,910,474
Traffic and transportation systems 627,483 736,018 - 1,363,501
Total capital assets
being depreciated 31,288,610 1,482,419 (17,873) 32,753,156
Less accumulated depreciation for
Buildings and structures (253,134) (52,792) - (305,926)
Improvements other than buildings (8,922) (843) - (9,765)
Machinery and equipment (1,426,637) (204,135) 17,873 (1,612,899)
Software (19,382) (20,894) - (40,276)
Vehicles and trailers (314,691) (42,005) - (356,696)
Utility systems (10,863,228) (416,521) - (11,279,749)
Traffic and transportation systems (223,551) (31,374) - (254,925)
Total accumulated
depreciation (13,109,545) (768,564) 17,873 (13,860,236)
Total capital assets being
depreciated, net 18,179,065 713,855 - 18,892,920
Business-type activities
capital assets, net 19,889,415$ 3,165,058$ (771,018)$ 22,283,455$
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City of Crystal
Notes to Financial Statements
NOTE 5 – CAPITAL ASSETS (CONTINUED)
Depreciation expense was charged to the various functions of the City as follows:
Governmental activities
General government 187,295$
Public safety 233,704
Public works 3,012,491
Parks and recreation 452,484
Community development 2,623
Total depreciation expense - governmental activities 3,888,597$
Business-type activities
Water 226,375$
Sanitary sewer 164,987
Storm drainage 344,985
Street Light 32,217
Total depreciation expense - business-type activities 768,564$
NOTE 6 – LONG-TERM DEBT
A. General Obligation Bonds
The government issues general obligation (G.O.) bonds (including certificates of indebtedness), tax
increment bonds, and special assessment bonds to provide funding for the acquisition of capital assets,
tax increment projects, and street improvements, respectively. G.O. bonds are direct obligations and
pledge the full faith and credit of the government.
B. Components of Long-Term Liabilities
Issue Interest Original Final Balance
Date Rates Issue Maturity End of Year
Governmental activities
Special Assessment Bonds
G.O. Improvement Bonds, Series 2008A 08/01/08 3.50%-4.35% 2,190,000$ 02/01/24 900,000$
G.O. Improvement Bonds, Series 2009A 08/01/09 2.00%-4.50% 3,360,000 02/01/25 2,020,000
G.O. Improvement Bonds, Series 2011A 08/01/11 0.50%-3.55% 1,705,000 02/01/27 1,030,000
G.O. Improvement Bonds, Series 2012A 08/01/12 1.50%-2.13% 2,635,000 02/01/28 1,805,000
G.O. Improvement Bonds, Series 2013A 08/01/13 2.00%-3.50% 3,235,000 02/01/29 2,525,000
G.O. Improvement Bonds, Series 2015A 08/01/15 2.50%-3.00% 2,550,000 02/01/31 2,325,000
G.O. Improvement Bonds, Series 2016A 08/25/16 2.00%-2.50% 3,330,000 02/01/32 3,330,000
G.O. Improvement Bonds, Series 2017A 09/14/17 2.00%-3.00% 4,665,000 02/01/33 4,665,000
Subtotal bonds payable 18,600,000
Total governmental activities 18,600,000$
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City of Crystal
Notes to Financial Statements
NOTE 6 – LONG-TERM DEBT (CONTINUED)
C. Changes in Long-Term Liabilities
Interest paid on most of the debt issued by the City is exempt from federal income tax. As a result,
purchasers of this debt are willing to accept lower interest rates than they would on taxable debt. The
City pools the proceeds of bond issues held in construction funds and the accumulated cash in debt
service funds with all other available cash and invests it according to the City's cash management
policies and practices. This sometimes produces a higher yield on the investments than is being paid on
the related debt. The federal tax code refers to this higher yield as arbitrage. Under certain circumstances
the earnings from these higher yields must be rebated to the federal government. Federal law requires
that arbitrage be calculated and rebated at the end of each five-year period that tax exempt debt is
outstanding, as well as at maturity. The City does not report arbitrage until the liability is due and
payable.
Long-term liability activity for the year ended December 31, was as follows:
Retirements
Beginning and Other Ending Due Within
Balance Additions Reductions Balance One Year
Governmental activities
Bonds payable
G.O. Bonds
Aquatic Center Bonds - 2005B 765,000$ -$ (765,000)$ -$ -$
Street Reconstruction Bonds - 2013B 85,940 - (85,940) - -
850,940 - (850,940) - -
Bond Discounts (3,697) - 3,697 - -
Subtotal 847,243 - (847,243) - -
G.O. Special Assessment Bonds
with Government Commitment
Improvement Bonds - 2008A 1,045,000 - (145,000) 900,000 140,000
Improvement Bonds - 2009A 2,200,000 - (180,000) 2,020,000 175,000
Improvement Bonds - 2011A 1,155,000 - (125,000) 1,030,000 120,000
Improvement Bonds - 2012A 2,000,000 - (195,000) 1,805,000 190,000
Improvement Bonds - 2013A 2,770,000 - (245,000) 2,525,000 240,000
Improvement Bonds - 2015A 2,550,000 - (225,000) 2,325,000 195,000
Improvement Bonds - 2016A 3,330,000 - - 3,330,000 280,000
Improvement Bonds - 2017A - 4,665,000 - 4,665,000 -
15,050,000 4,665,000 (1,115,000) 18,600,000 1,340,000
Bond Premiums 277,905 273,843 (39,075) 512,673 -
Bond Discounts (46,038) - 1,879 (44,159) -
Subtotal 15,281,867 4,938,843 (1,152,196) 19,068,514 1,340,000
Total Bonds Payable 16,129,110 4,938,843 (1,999,439) 19,068,514 1,340,000
Compensated absences payable 817,760 738,643 (802,441) 753,962 271,993
Governmental activity
long-term liabilities 16,946,870$ 5,677,486$ (2,801,880)$ 19,822,476$ 1,611,993$
Business-type activities
Compensated absences payable 130,002$ 59,109$ (53,156)$ 135,955$ 31,025$
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City of Crystal
Notes to Financial Statements
NOTE 6 – LONG-TERM DEBT (CONTINUED)
D. Minimum Debt Payments
G.O. special assessment bond payments will be funded by special assessments levied against property
owners benefited by street improvements as well as interest earnings. Annual debt service requirements
to maturity for G.O.
Total delinquent special assessments receivable for all funds for the years ending December 31, 2017
and 2016, were $225,791 and $235,489, respectively.
Compensated absences are liquidated by the General, EDA, Water, Sanitary Sewer, or Storm Drainage
funds, depending upon where employees' time is assigned.
NOTE 7 – TAX INCREMENT FINANCING REVENUE NOTES
The City has entered into a private redevelopment agreement regarding certain tax increment properties.
Reimbursements for this agreement is in the form of tax increment revenue notes.
This note provides for the payment of principal, equal to the project redevelopment costs, plus interest at
various rates. Payments on the note will be made at the lesser of the note payment or the actual net tax
increment received (or a reduced percentage received in certain cases), as stated in the agreement.
Payments are first applied to accrued interest and then to principal balances. The note is cancelled at the
end of the agreement term whether or not they have been repaid in full.
The outstanding principal balances as of December 31, 2017, are as follows:
Maturity Amount
Dates Outstanding
Tax Increment Revenue Note - 2014 2016 - 2026 5.00 956,309
956,309$
Rates
Interest
Due to the nature of this note (in that repayment is required only if sufficient tax increments are
received), the outstanding amount is not reported in the accompanying financial statements. The City's
position is that this is an obligation to assign future and uncertain revenue sources and, as such, is not
actual debt in substance. Payments of principal and interest on tax increment revenue notes are paid out
of the TIF Districts special revenue fund.
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City of Crystal
Notes to Financial Statements
NOTE 8 – CONDUIT DEBT OBLIGATIONS
From time to time the City has issued revenue bonds to provide financial assistance to private-sector
entities for the acquisition and construction of facilities deemed to be in the public interest. The bonds
are secured by the property financed and are payable solely from payments received on the underlying
mortgage loans.
Upon repayment of the bonds, ownership of the acquired facilities transfers to the private-sector entity
served by the bond issue. Neither the City or the State, nor any political subdivision thereof, is obligated
in any manner for repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the
accompanying financial statements.
As of December 31, 2017, there were four debt issues outstanding. The aggregate original issue amounts
and principal balances outstanding as of December 31, 2017, are as follows:
Original Principal
Name of Issue Year Issue Balance
Crystal Apts. Multi Family Housing Refunding Bonds 1997 $ 5,825,000 $ 5,825,000
Calibre Chase Multi Family Housing Refunding Bonds 2004 2,910,000 2,910,000
LOGIS Government Facilities Revenue Bonds 2006 6,000,000 3,442,182
Crystal Leased Housing Multi Family Housing Bonds 2014 14,300,000 14,185,000
$ 29,035,000 $ 26,362,182
NOTE 9 – PENSION PLANS
The city participates in various pension plans, total pension expense for the year ended December 31,
2017, was $1,416,364. The components of pension expense are noted in the following plan summaries.
Public Employees' Retirement Association
A. Plan Description
The City participates in the following cost-sharing multiple-employer defined benefit pension plans
administered by PERA. PERA's defined benefit pension plans are established and administered in
accordance with Minnesota Statutes, Chapters 353 ad 356. PERA's defined benefit pension plans are tax
qualified plans under Section 401(a) of the Internal Revenue Code.
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City of Crystal
Notes to Financial Statements
NOTE 9 – PENSION PLANS (CONTINUED)
Public Employees' Retirement Association (Continued)
A. Plan Description (Continued)
General Employees Retirement Plan (General Employees Plan (accounted for in the General Employees
Fund))
All full-time and certain part-time employees of the City are covered by the General Employees Plan.
General Employees Plan members belong to the Coordinated Plan. Coordinated Plan members are
covered by Social Security.
Public Employees Police and Fire Plan (Police and Fire Plan (accounted for in the police and Fire Fund))
The Police and Fire Plan, originally established for police officers and firefighters not covered by a local
relief association, now covers all police officers and firefighters hired since 1980. Effective July 1, 1999,
the Police and Fire Plan also covers police officers and firefighters belonging to a local relief association
that elected to merge with and transfer assets and administration to PERA.
B. Benefits Provided
PERA provides retirement, disability, and death benefits. Benefit provisions are established by state
statute and can only be modified by the state legislature.
Benefit increases are provided to benefit recipients each January. Increases are related to the funding
ratio of the plan. Members in plans that are at least 90% funded for two consecutive years are given
2.5% increases. Members in plans that have not exceeded 90% funded, or have fallen below 80%, are
given 1% increases.
The benefit provisions stated in the following 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.
General Employee Plan Benefits
General Employees Plan 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 PERA's Coordinated 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 Coordinated Plan member is 1.2% of average salary for each of the first ten
years and 1.7% for each remaining year. Under Method 2, the annuity accrual rate is 1.7% for
Coordinated Plan members for each year of service. For members hired prior to July 1, 1989, a full
annuity is available when age plus years of service equal 90 and normal retirement age is 65. For
members hired on or after July 1, 1989, normal retirement age is the age for unreduced Social Security
benefits capped at 66.
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City of Crystal
Notes to Financial Statements
NOTE 9 – PENSION PLANS (CONTINUED)
Public Employees' Retirement Association (Continued)
Police and Fire Plan Benefits
Benefits for the Police and Fire Plan members first hired after June 30, 2010, but before July 1, 2014,
vest on a prorated basis from 50% after five years up to 100% after ten years of credited service. Benefits
for Police and Fire Plan members first hired after June 30, 2014, vest on a prorated basis from 50% after
ten years up to 100% after twenty years of credited service. The annuity accrual rate is 3% of average
salary for each year of service. For Police and Fire Plan who were first hired prior to July 1, 1989, a full
annuity is available when age plus years of service equal at least 90.
C. Contributions
Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. Contribution
rates can only be modified by the state legislature.
General Employees Fund Contributions
Coordinated Plan members were required to contribute 6.5%, of their annual covered salary in calendar
year 2017. The City was required to contribute 7.50% for Coordinated Plan members in calendar year
2017. The City's contributions to the General Employees Fund for the year ended December 31, 2017,
were $318,656. The City's contributions were equal to the required contributions as set by state statute.
Police and Fire Fund Contributions
Plan members were required to contribute 10.8% of their annual covered salary in calendar year 2017.
The City was required to contribute 16.2% of pay for members in calendar year 2017. The City's
contributions to the Police and Fire Fund for the year ended December 31, 2017, were $447,205. The
City's contributions were equal to the required contributions as set by state statute.
D. Pension Costs
General Employees Fund Pension Costs
At December 31, 2017, the City reported a liability of $4,449,602 for its proportionate share of the
General Employees Fund's net pension liability. The City's net pension liability reflected a reduction due
to the State of Minnesota's contribution of $6 million to the fund in 2017. The State of Minnesota is
considered a non-employer contributing entity and the State's contribution meets the definition of a
special funding situation. The State of Minnesota's proportionate share of the net pension liability
associated with the City totaled $55,982. The net pension liability was measured as of June 30, 2017,
and the total pension liability used to calculate the net pension liability was determined by an actuarial
valuation as of that date. The City's proportion of the net pension liability was based on the City's
contributions received by PERA during the measurement period for employer payroll paid dates from
July 1, 2016, through June 30, 2017, relative to the total employer contributions received from all of
PERA's participating employers. At June 30, 2017, the City's proportion share was 0.0697%, which was
an increase of 0.0010% from its proportion measured as of June 30, 2016.
6.2
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City of Crystal
Notes to Financial Statements
NOTE 9 – PENSION PLANS (CONTINUED)
D. Pension Costs (Continued)
General Employees Fund Pension Costs (Continued)
For the year ended December 31, 2017, the City recognized pension expense of $563,822 for its
proportionate share of General Employees Plan's pension expense. Included in the amount, the City
recognized $1,617 as pension expense (and grant revenue) for its proportionate share of the State of
Minnesota's contribution of $6 million to the General Employees Fund.
At December 31, 2017, the City reported its proportionate share of the General Employees Plan's
deferred outflows of resources and deferred inflows of resources, related to pensions from the following
sources:
Differences between expected and actual economic experience 146,645$ 282,757$
Changes in actuarial assumptions 728,130 446,073
Difference between projected and actual investment earnings 19,203 -
Changes in proportion 60,897 110,914
Contributions paid to PERA subsequent
to the measurement date 159,328 -
1,114,203$ 839,744$
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
$159,328 reported as deferred outflows of resources related to pensions resulting from City contributions
subsequent to the measurement date will be recognized as a reduction of the net pension liability in the
year ended December 31, 2018. Other amounts reported as deferred outflows and deferred inflows of
resources related to pensions will be recognized in pension expense as follows:
Year Ending Pension Expense
December 31,Amount
2018 108,843$
2019 262,065
2020 (66,900)
2021 (188,877)
Total 115,131$
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City of Crystal
Notes to Financial Statements
NOTE 9 –PENSION PLANS (CONTINUED)
Public Employees' Retirement Association (Continued)
D. Pension Costs (Continued)
Police and Fire Fund Pension Costs
At December 31, 2017, the City reported a liability of $3,486,909 for its proportionate share of the
Police and Fire Fund's net pension liability. The net pension liability was measured as of June 30, 2017,
and the total pension liability used to calculate the net pension liability was determined by an actuarial
valuation as of that date. The City's proportion of the net pension liability was based on the City's
contributions received by PERA during the measurement period for employer payroll paid dates from
July 1, 2016, through June 30, 2017, relative to the total employer contributions received from all of
PERA's participating employers. At June 30, 2017, the City's proportion was 0.2600 %, which was an
increase of 0.0170% from its proportion measured as of June 30, 2016. The City also recognized
$23,400 for the year ended December 31, 2017 as revenue and an offsetting reduction of the net pension
liability for its proportionate share of the State of Minnesota's on-behalf contributions to the Police and
Fire Fund. Legislation passed in 2013 required the State of Minnesota to begin contributing $9 million to
the Police and Fire Fund each year, starting in fiscal year 2014.
For the year ended December 31, 2017, the City recognized pension expense of $850,377 for its
proportionate share of the Police and Fire Fund pension expense.
At December 31, 2017, the City reported its proportionate share of the Police and Fire Plan's deferred
outflows of resources and deferred inflows of resources related to pensions from the sources below and
on the following page.
Differences between expected and actual economic experience 80,800$ 873,765$
Changes in actuarial assumptions 4,293,568 4,983,768
Difference between projected and actual investment earnings - 30,737
Changes in proportion 591,259 48,603
Contributions paid to PERA subsequent
to the measurement date 223,603 -
5,189,230$ 5,936,873$
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
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City of Crystal
Notes to Financial Statements
NOTE 9 –PENSION PLANS (CONTINUED)
Public Employees' Retirement Association (Continued)
D. Pension Costs (Continued)
Police and Fire Fund Pension Costs (Continued)
$223,603 reported as deferred outflows of resources related to pensions resulting from City contributions
subsequent to the measurement date will be recognized as a reduction of the net pension liability in the
year ended December 31, 2018. Other amounts reported as deferred outflows and deferred inflows of
resources related to pensions will be recognized in pension expense as follows:
Year Ending Pension Expense
December 31,Amount
2018 77,602$
2019 77,605
2020 (41,182)
2021 (218,386)
2022 (866,885)
Total (971,246)$
E. Actuarial Assumptions
The total pension liability in the June 30, 2017, actuarial valuation was determined using the entry age
normal actuarial cost method and the following actuarial assumptions:
Inflation 2.50 % Per year
Active member payroll growth 3.25 Per year
Investment rate of return 7.50
Salary increases were based on a service-related table. Mortality rates for active members, retirees,
survivors, and disabilitants were based on RP-2014 tables for all plans for males or females, as
appropriate, with slight adjustments to fit PERA's experience. Cost of living benefit increases for retirees
are assumed to be 1% per year for the General Employees plan through 2044 and the Police and Fire
Plan through 2064 and then 2.5% thereafter for both plans.
Actuarial assumptions used in the June 30, 2017, valuation were based on the results of actuarial
experience studies. The most recent four-year experience study in the General Employees Plan was
completed in 2015. The most recent five-year experience study for Police and Fire Plan was completed
in 2016.
6.2
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City of Crystal
Notes to Financial Statements
NOTE 9 –PENSION PLANS (CONTINUED)
Public Employees' Retirement Association (Continued)
E. Actuarial Assumptions (Continued)
The following changes in actuarial assumptions occurred in 2017:
General Employees Fund
• The Combined Service Annuity (CSA) loads were changed from 0.8% for active members and
60% for vested and non-vested deferred members. The revised CSA loads are now 0.0% for
active member liability, 15% for vested deferred member liability, and 3% for non-vested
deferred member liability.
• The assumed post-retirement benefit increase rate was changed from 1% per year for all years to
1% per year through 2044 and 2.5% per year thereafter.
Police and Fire Fund
• Assumed salary increases were changed as recommended in the June 30, 2016 experience study.
The net effect is proposed rates that average 0.34% lower than the previous rates.
• Assumed rates of retirement were changed, resulting in fewer retirements.
• The CSA load was 30% for vested and non-vested deferred members. The CSA has been
changed to 33% for vested members and 2% for non-vested members.
• The base mortality table for healthy annuitants was changed from the RP-2000 fully generational
table to the RP-2014 fully generational table (with a base year of 2006), with male rates adjusted
by a factor of 0.96. The mortality improvement scale was changed from Scale AA to Scale MP-
2016. The base mortality table for disabled annuitants was changed from the RP-2000 disabled
mortality table to the mortality tables assumed for healthy retirees.
• Assumed termination rates were decreased to 3.0% for the first three years of service. Rates
beyond the select period of three years were adjusted, resulting in more expected terminations
overall.
• Assumed percentage of married female members was decreased from 65% to 60%.
• Assumed age difference was changed from separate assumptions for male members (wives
assumed to be 3 years younger) and female members (husbands assumed to be 4 years older) to
the assumption that males are 2 years older than females.
• The assumed percentage of female members electing Joint and Survivor annuities was increased.
• The assumed post-retirement benefit increase rate was changed from 1% for all years to 1% per
year through 2064 and 2.5% thereafter.
6.2
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City of Crystal
Notes to Financial Statements
NOTE 9 –PENSION PLANS (CONTINUED)
Public Employees' Retirement Association (Continued)
E. Actuarial Assumptions (Continued)
The State Board of Investment, which manages the investments of PERA, prepares an analysis of the
reasonableness on a regular basis of the long-term expected rate of return using a building-block method
in which best-estimate ranges of expected future rates of return are developed for each major asset class.
These ranges are combined to produce an expected long-term rate of return by weighting the expected
future rates of return by the target asset allocation percentages. The target allocation and best estimates
of geometric real rates of return for each major asset class are summarized in the following table:
Domestic stocks 39 %5.10 %
International stocks 19 5.30
Bonds 20 0.75
Alternative assets 20 5.90
Cash 2 0.00
Total 100 %
Asset Class
Long-Term
Expected Real
Rate of ReturnTarget Allocation
F. Discount Rate
The discount rate used to measure the total pension liability in 2017 was 7.5%. The projection of cash
flows used to determine the discount rate assumed that contributions from Plan members and employers
will be made at rates set in Minnesota Statutes. Based on those assumptions, the fiduciary net position of
the General Employees Fund and the Police and Fire Fund was projected to be available to make all
projected future benefit payments of current Plan members. Therefore, the long-term expected rate of
return on pension plan investments was applied to all periods of projected benefit payments to determine
the total pension liability.
6.2
78
City of Crystal
Notes to Financial Statements
NOTE 9 –PENSION PLANS (CONTINUED)
Public Employees' Retirement Association (Continued)
G. Pension Liability Sensitivity
The table on the following page presents the City's proportionate share of the net pension liability for all
plans it participates in, calculated using the discount rate disclosed in the preceding paragraph, as well as
what the City's proportionate share of the net pension liability would be if it were calculated using a
discount rate 1 percentage point lower or 1 percentage point higher than the current discount rate:
1% Decrease in 1% Increase in
City's proportionate share of
the General Employees Fund
net pension liability 6,901,663$ 4,449,602$ 2,442,144$
1% Decrease in 1% Increase in
City's proportionate share of
the Police and Fire Fund
net pension liability 6,587,537$ 3,486,909$ 927,170$
Discount Rate
(6.5%)
Discount Rate
(7.5%)
Discount Rate
(8.5%)
Discount Rate
(6.5%)
Discount Rate
(7.5%)
Discount Rate
(8.5%)
H. Pension Plan Fiduciary Net Position
Detailed information about each pension plan's fiduciary net position is available in a separately-issued
PERA financial report that includes financial statements and required supplementary information. That
report may be obtained on the Internet at www.mnpera.org.
Public Employees Defined Contribution Plan (Defined Contribution Plan)
Certain employee types of the of the City of Crystal, which include council members, are covered by the
Defined Contribution Plan, a multiple-employer deferred compensation plan administered by PERA.
The Defined Contribution Plan is a tax qualified plan under Section 401(a) of the Internal Revenue Code
and all contributions by or on behalf of employees are tax deferred until time of withdrawal.
6.2
79
City of Crystal
Notes to Financial Statements
NOTE 9 –PENSION PLANS (CONTINUED)
Public Employees Defined Contribution Plan (Defined Contribution Plan) (Continued)
Plan benefits depend solely on amounts contributed to the plan plus investment earnings, less
administrative expenses, therefore, there is no future liability to the employer. Minnesota Statutes,
Chapter 353D.03, specifies plan provisions, including the employee and employer contribution rates for
those qualified personnel who elect to participate. An eligible elected official who decides to participate
contributes 5% of salary which is matched by the elected official's employer. For ambulance service
personnel, employer contributions are determined by the employer, and for salaried employees must be a
fixed percentage of salary. Employer contributions for volunteer personnel may be a unit value for each
call or period of alert duty. Employees who are paid for their services may elect to make member
contributions in an amount not to exceed the employer share. Employer and employee contributions are
combined and used to purchase shares in one or more of the seven accounts of the Minnesota
Supplemental Investment Fund. For administering the plan, PERA receives 2% of employer
contributions and twenty-five hundredths of 1% (.0025) of the assets in each member's account annually.
Total contributions made by the City during fiscal year 2017 were:
Contribution Amount Percentage of Covered Payroll
Employee Employer Employee Employer Required Rate
2,165$ 2,165$ 5%5%5%
NOTE 10 – POST EMPLOYMENT HEALTH CARE PLAN
A. Plan Description
The City provides a single-employer defined benefit health care plan to eligible retirees and their
spouses. The plan offers medical coverage. Medical coverage is administered by BlueCross BlueShield.
It is the City's policy to periodically review its medical coverage and to obtain requests for proposals in
order to provide the most favorable benefits and premiums for City employees and retirees.
B. Funding Policy
Retirees and their spouses contribute to the healthcare plan at the same rate as City employees. This
results in retirees receiving an implicit rate subsidy. Contribution requirements are established by the
City based on contract terms with BCBS. Required contributions are based on projected pay-as-you-go
financing requirements. For fiscal year 2017, the City contributed $33,479 to the plan. As of January 1,
2016, there were seven retirees or dependents receiving health benefits from the City's health plan.
6.2
80
City of Crystal
Notes to Financial Statements
NOTE 10 – POST EMPLOYMENT HEALTH CARE PLAN (CONTINUED)
C. Annual Other Post Employment Benefits Cost and Net Other Post Employment
Benefits Obligation
The City's annual other post employment benefits (OPEB) cost (expense) is calculated based on the
annual required contribution (ARC) of the City, an amount actuarially determined in accordance with the
parameters of GASB Statement No. 45. The ARC represents a level of funding that, if paid on an
ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities
(or funding excess) over a period not to exceed thirty years. The liability is funded by the General, EDA,
Water, Sanitary Sewer, and Storm Drainage funds.
The following table shows the components of the City's annual OPEB cost for the year, the amount
actually contributed to the plan, and changes in the City's net OPEB obligation.
ARC 109,381$
Interest on net OPEB obligation 27,502
Adjustment to ARC (23,858)
Annual OPEB cost (expense)113,025
Contributions made (33,479)
Increase in net OPEB obligation 79,546
Net OPEB obligation - beginning of year 611,162
Net OPEB obligation - end of year 690,708$
The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net
OPEB obligation was as follows:
Year Ended
Annual OPEB
Cost
Employer
Contribution
Percentage of
Annual OPEB Cost
Contributed
Increase
(Decrease) in
Net OPEB
Obligation
Net OPEB
Obligation
12/31/15 124,505$ 39,403$ 32%85,102$ 530,851$
12/31/16 109,283 28,972 27%80,311 611,162
12/31/17 113,025 33,479 30%79,546 690,708
D. Funded Status and Funding Progress
As of January 1, 2016, the most recent actuarial valuation date, the City had no assets deposited to fund
the plan. The actuarial accrued liability for benefits was recalculated and equaled $1,010,896 for January
1, 2017 using the January 1, 2016 actuarial valuation and the actuarial value of plan assets was $0,
resulting in an unfunded actuarial accrued liability (UAAL) of $1,010,896. The estimated covered
payroll (annual payroll of active employees covered by the plan) was $6,378,000, and the ratio of the
UAAL to covered payroll was 15%.
6.2
81
City of Crystal
Notes to Financial Statements
NOTE 10 – POST EMPLOYMENT HEALTH CARE PLAN (CONTINUED)
D. Funded Status and Funding Progress (Continued)
Actuarial valuations involve estimates of the value of reported amounts and assumptions about the
probability of occurrence of events far into the future. Examples include assumptions about future
employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status
of the plan and the annual required contributions of the employer are subject to continual revision as
actual results are compared with past expectations and new estimates are made about the future.
The Schedule of Funding Progress, presented as required supplementary information following the notes
to the financial statements, presents multi-year trend information about whether the actuarial value of
plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits.
E. Actuarial Methods and Assumptions
Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as
understood by the employer and the plan members) and include the types of benefits provided at the time
of each valuation and the historical pattern of sharing of benefit costs between the employer and plan
members to that point. The actuarial methods and assumptions used include techniques that are designed
to reduce the effects of short-term volatility in actuarial accrued liabilities, consistent with the long-term
perspective of the calculations.
In the January 1, 2016, actuarial valuation, the projected unit credit actuarial cost method was used. The
actuarial assumptions included a 4.5% discount rate, which is based on the investment yield expected to
finance benefits. The City currently does not plan to prefund for this benefit. At the actuarial valuation
date the annual healthcare cost trend rate was calculated to be 9.00% initially, reduced incrementally to
an ultimate rate of 5% after eleven years. Both rates included a 3% inflation assumption. The UAAL is
being amortized as a level percentage of projected payroll on a 30-year open period, with a single base at
each measurement date equal to the UAAL.
6.2
82
City of Crystal
Notes to Financial Statements
NOTE 11 – FUND BALANCES
A. Classifications
A summary of governmental fund balance classifications at December 31, 2017, is as follows:
Special
Revenue
Fund Capital Project Funds
Capital Street Police
General Debt Improve.Recon-Equipment Other
Fund EDA Service Revolving struction Revolving Funds Total
Fund balances
Nonspendable
Inventory 19,169$ -$ -$ -$ -$ -$ -$ 19,169$
Restricted
Housing and Redevelopment
Assistance - - - - - - 1,768,695 1,768,695
Debt service - - 5,312,296 - - - - 5,312,296
Dwi-related enforcement,
Training, and education - - - - - - 27,824 27,824
Total restricted - - 5,312,296 - - - 1,796,519 7,108,815
Committed
Compensated absences 753,962 - - - - - - 753,962
Housing and redevelopment
Assistance - 3,846,024 - - - - - 3,846,024
Cap. outlay - city wide - - - 8,211,949 - - - 8,211,949
Cap. outlay - replace and
renovation of city bldgs.- - - - - - 644,615 644,615
Cap. outlay - street
reconstruction - - - - 2,718,992 - - 2,718,992
Cap. outlay - police equip.- - - - - 2,870,691 - 2,870,691
Cap. outlay - cable TV equip.- - - - - - 111,450 111,450
Cap. outlay - park improvement - - - - - - 212,683 212,683
Cap. outlay - street maint.- - - - - - 1,696,974 1,696,974
Total committed 753,962 3,846,024 - 8,211,949 2,718,992 2,870,691 2,665,722 21,067,340
Assigned
Police Dept. purposes - - - - - - 51,042 51,042
Park and Rec. Dept. purposes - - - - - - 3,539 3,539
Other purposes - - - - - - 19,343 19,343
Total assigned - - - - - - 73,924 73,924
Unassigned 6,119,325 - - - - - - 6,119,325
Total fund balances 6,892,456$ 3,846,024$ 5,312,296$ 8,211,949$ 2,718,992$ 2,870,691$ 4,536,165$ 34,388,573$
Major Funds
6.2
83
City of Crystal
Notes to Financial Statements
NOTE 12 – 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. As such, the City participates in the
League of Minnesota Cities Insurance Trust (LMCIT), a public entity risk pool currently operating as a
common risk management and insurance program for cities that are parties to a joint powers agreement.
The LMCIT is self-sustaining through member premiums and reinsures through commercial companies
for claims in excess of pre-determined amounts. The LMCIT provides coverage for liability, errors and
omissions, worker's compensation, auto, and other miscellaneous types of coverage.
The City's Self-Insurance Fund (an internal service fund) is used to account for and finance its uninsured
risks of loss. The Self-Insurance Fund provides coverage for up to a maximum of $25,000 for each
general liability or property damage claim, up to $75,000 per year. The City purchases commercial
insurance for claims in excess of coverage provided by this fund, as well as for all other risks of loss.
Settled claims exceeded commercial coverage in 2017. There were no significant reductions in insurance
coverage during 2017.
All funds of the City contribute to the Self-Insurance Fund based on estimates of the amounts needed to
pay prior and current year claims. The claims liability of $15,000 is included in accounts payable of the
Self-Insurance Fund at December 31, 2017. The liability amount is based on the requirements of GASB
Statement No. 10, which requires that a liability for claims be reported when information prior to the
issuance of the financial statements indicates that it is probable that a liability has been incurred as of the
date of the financial statements and the amount of the loss can be reasonably estimated. The estimate of
the liability also includes amounts for incremental claim adjustment expenses related to specific claims
and other claim adjustment expenses, regardless of whether allocated to specific claims. Estimated
recoveries, for example from salvage or subrogation, are another component of the claims liability
estimate.
The maximum liability for any one year is $75,000. The total liability may exceed $75,000 if claims are
open from more than one year.
Changes in claims liability for 2017 and 2016 are as follows:
Year
Claims Liability
Beginning of
Year
Current Year
Claims and
Changes in
Estimates
Payments on
Claims
Claims Liability
End of Year
2016 144,587$ 113,046$ 106,458$ 151,175$
2017 151,175 (47,832) 88,343 15,000
6.2
84
City of Crystal
Notes to Financial Statements
NOTE 13 – JOINT VENTURES AND JOINTLY GOVERNED ORGANIZATIONS
A. Joint Ventures
1. Golden Valley, Crystal, and New Hope Joint Water Commission
The City is a member of a joint powers agreement, together with the cities of Golden Valley and
New Hope, which established a Joint Water Commission (JWC). The JWC was created in 1963 to
provide for the creation and maintenance of a joint water supply, storage, and distribution system
through which water purchased from the City of Minneapolis can be supplied to the population of
the member cities.
The city council of each member city is entitled to appoint one member to the JWC. Original
construction costs were allocated to the member cities based on percentages agreed upon in the joint
powers agreement. All property acquired under this agreement is owned by the members in
proportion to the amount of construction costs paid by each member city. All subsequent operating
and maintenance costs are apportioned to, and paid by, each member city on the basis of water usage.
The City's equity interest and its share of the net income (loss) of the JWC are reported in the City's
Water Fund (an Enterprise Fund). The City's equity interest in the JWC at December 31, 2017, is
$4,323,142.
Due to concurrent timing of the City's fiscal year end and audit of the JWC, the City reports its
equity interest in the JWC with a one-year lag. The following financial information is from the
JWC's audited financial statements for the year ended December 31, 2016:
Total assets 16,162,977$
Total liabilities 544,223
Net position
Net investment in capital assets 9,941,146
Restricted for capital improvements 4,772,785
Unrestricted 904,823
Total net position 15,618,754$
Total program expenses 6,724,714$
Total program revenues 7,592,560
Net program revenue 867,846
Total general revenues 138,098
Change in net position 1,005,944
Net position
Beginning of year 14,612,810
End of year 15,618,754$
JWC audited financial statements are available from the City of Golden Valley, Finance Department,
7800 Golden Valley Road, Golden Valley, MN 55427.
6.2
85
City of Crystal
Notes to Financial Statements
NOTE 13 – JOINT VENTURES AND JOINTLY GOVERNED ORGANIZATIONS
(CONTINUED)
A. Joint Ventures (Continued)
2. West Metro Fire-Rescue District
Effective January 2, 1998, the City entered into a joint powers agreement with the City of New Hope
for the purpose of consolidating fire departments of the two cities. Operations commenced in July
1998 under the name of West Metro Fire-Rescue District (the District).
The District is governed by a seven-member board of directors that includes one Crystal City
Council member who is appointed by resolution, one public member appointed by the City Council,
and the City Manager, who serves ex officio.
As required by the agreement, the City transferred fire department equipment to the District,
retaining its rights to these assets in the event of the District's dissolution. The equipment transferred
had a cost value of $1,923,820. The District recorded only the rolling stock received and recorded it
at its estimated fair value. Other equipment items were not capitalized.
The City's equity interest and its share of the net income (loss) of the District are reported only in the
government-wide financial statements. It is not reported in the General Fund because the equity
interest represents equity primarily in capital assets vs. financial resources. The City's equity interest
in the District at December 31, 2016 is $1,690,079.
Due to concurrent timing of the City's fiscal year end and audit of the District, the City reports its
equity interest in the District with a one-year lag. The following financial information is from the
District's audited financial statements for the year ended December 31, 2016:
Total assets and deferred outflows of resources 7,203,101$
Total liabilities and deferred inflows of resources 4,452,509
Net position
Net investment in capital assets 2,805,025
Restricted for donor-approved purposes 37,030
Unrestricted (91,463)
Total net position 2,750,592$
Total program expenses 2,831,796$
Total program revenues 2,088,549
Net program revenue (expense)(743,247)
Total general revenues 49,859
Change in net position (693,388)
Net position
Beginning of year 3,443,980
End of year 2,750,592$
6.2
86
City of Crystal
Notes to Financial Statements
NOTE 13 – JOINT VENTURES AND JOINTLY GOVERNED ORGANIZATIONS
(CONTINUED)
A. Joint Ventures (Continued)
2. West Metro Fire-Rescue District (Continued)
The activities of the District will continue to be funded entirely by the cities of Crystal and New
Hope, with each city contributing its proportionate share of the annual operating budget in monthly
installments. According to a formula in the agreement, the City's share of the District's operating
budget is 49.92%.
Audited financial statements are available from West Metro Fire-Rescue District, 4251 Xylon
Avenue N., New Hope, MN 55428.
B. Jointly Governed Organizations
1. Local Government Information Systems Association (LOGIS)
The City is a member of LOGIS, a consortium of Minnesota government entities that provides
computerized data processing and support services to its members. LOGIS is legally separate from
the City, the City does not appoint a voting majority of the Board, and it is fiscally independent of
the City. The amount paid to LOGIS for services received in 2017 was $392,577 which was
allocated to various funds based on application usage.
2. LOGIS Insurance Group
This group provides cooperative purchasing of health and life insurance benefits for over 40
government entities. The amount paid for 2017 health and life insurance benefits was $1,146,098.
3. Pets Under Police Security (PUPS)
The City is party to a joint powers agreement, together with five other cities, which created an
organization to provide for the efficient and economical impoundment of animals in a jointly owned
and operated facility. The amount paid to PUPS for services received in 2017 was $19,182.
4. Bassett Creek Watershed Management Commission (BCWMC)
The City is party to a joint powers agreement, together with eight other cities, the purpose of which
is to provide for cooperative planning, usage, and improvement of the Bassett Creek watershed. The
amount paid to BCWMC in 2017 was $26,904.
5. Shingle Creek Watershed Management Commission (SCWMC)
The City is party to a joint powers agreement, together with eight other cities, which was created to
protect and manage the water resources of the Shingle Creek watershed. The amount paid to
SCWMC in 2017 was $26,590.
6.2
87
City of Crystal
Notes to Financial Statements
NOTE 13 – JOINT VENTURES AND JOINTLY GOVERNED ORGANIZATIONS
(CONTINUED)
B. Jointly Governed Organizations (Continued)
6. Hennepin Recycling Group (HRG)
The City is party to a joint powers agreement, together with the cities of Brooklyn Center and New
Hope, which established HRG. HRG was created to provide for the efficient and economical
collection, recycling, and disposal of solid waste within the cities. HRG contracts for collection and
recycling activities and the participating cities are billed for services provided to its residents. The
amount paid to HRG for services received in 2017 was $324,534.
Accounting services for HRG were provided by the City, which has reported the financial accounts
of HRG in an Agency Fund in these financial statements.
NOTE 14 – COMMITMENTS
The City has in process various multi-year construction projects which were not completed in the current
fiscal year. As of December 31, 2017, outstanding commitments for these multi-year projects total
approximately $1,409,450.
NOTE 15 – FACILITY USE AGREEMENT
On August 24, 2004, the City entered into a licensor-licensee relationship with ISD 281. Per terms of the
agreement, the City contributed $900,000 towards the cost of constructing and equipping a gymnasium.
In return, the City is entitled to use the space for public recreation as well as for programs and services
for its residents. The agreement is for a term of 40 years, running from September 1, 2005 through
August 31, 2045. ISD 281 has title to the property and is responsible for all subsequent operations and
maintenance costs.
NOTE 16 – CONTINGENT LIABILITIES
During the course of normal operations, the City may be subject to claims or other litigation. It is the
opinion of the City's attorney that resolution of these matters, if any at December 31, 2017, will not have
a material adverse effect on the financial condition of the City.
NOTE 17 – NEW STANDARDS ISSUED BUT NOT YET IMPLEMENTED
GASB has issued GASB statement 75 relating to accounting and financial reporting for postemployment
benefits other than pensions. The new statement requires governments in all types of OPEB plans to
present more extensive note disclosures and required supplementary information (RSI) about OPEB
liabilities. This Statement will be effective for the year ending December 31, 2018.
6.2
88
City of Crystal
Notes to Financial Statements
NOTE 17 – NEW STANDARDS ISSUED BUT NOT YET IMPLEMENTED (CONTINUED)
GASB Statement No. 87, Leases establishes a single model for lease accounting based on the
foundational principle that leases are financings of the right to use an underlying asset. Under this
statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and
a lessor is required to recognize a lease receivable and a deferred inflow of resources, thereby enhancing
the relevance and consistency of information about governments' leasing activities. This Statement will
be effective for the year ending December 31, 2020.
6.2
89
REQUIRED SUPPLEMENTARY INFORMATION
6.2
90
(THIS PAGE LEFT BLANK INTENTIONALLY)
6.2
91
City of Crystal
Retiree Health Plan – Schedule of Funding Progress
Year
Ended
Actuarial
Valuation
Date
Actuarial
Value of
Assets
(a)
Actuarial
Accrued Liability
(AAL) -
Projected Unit
Credit
(b)
Unfunded
AAL
(UAAL)
(b-a)
Funded
Ratio
(a/b)
Estimated
Covered
Payroll
UAAL as a
Percentage of
Covered
Payroll
((b-a)/c)
12/31/15*01/01/16 $ - $ 1,166,824 $ 1,166,824 0% $ 6,170,051 19%
12/31/16 01/01/17 - 927,310 927,310 0% 6,162,000 15%
12/31/17*01/01/18 - 1,010,896 1,010,896 0% 6,378,000 16%
* Because an actuarial valuation is being performed once every two years (in even years), the liabilities
and annual costs are based on the same population as the previous year's liabilities and annual costs.
6.2
City's Covered
Payroll
2017 0.0697%4,449,602$ 55,982$ 4,505,584$ 4,492,840$ 99.04%75.90%
2016 0.0687%5,578,099 72,855 5,650,954 4,260,733 130.92%68.91%
2015 0.0694%3,396,668 - 3,396,668 4,010,187 84.70%78.19%
Note: Schedule is intended to show ten year trend. Additional years will be reported as they become available.
For Fiscal Year
Ended June 30,
City's Proportion
of the Net
Pension Liability
(Asset)
City's
Proportionate
Share of the Net
Pension Liability
(Asset)
City's Covered
Payroll
City's
Proportionate
Share of the Net
Pension Liability
(Asset) as a
Percentage of its
Covered Payroll
Plan Fiduciary
Net Position as a
Percentage of the
Total Pension
Liability
2017 0.2600%3,486,909$ 2,664,136$ 130.88%85.43%
2016 0.2430%9,730,143 2,343,136 415.26%63.88%
2015 0.2400%2,726,962 2,136,679 127.63%86.61%
Note: Schedule is intended to show ten year trend. Additional years will be reported as they become available.
92
Plan Fiduciary
Net Position as a
Percentage of the
Total Pension
Liability
Last Ten Years
For Fiscal Year
Ended June 30,
Public Employees Police and Fire Retirement Fund
State's
Proportionate
Share (Amount)
of the Net
Pension Liability
Associated with
the City
City's
Proportionate
Share of the Net
Pension Liablility
and the State's
Proportionate
Share of the Net
Pension Liablility
Associated with
the City
City of Crystal
Schedule of City's Proportionate Share
of Net Pension Liability
Last Ten Years
Schedule of City's Proportionate Share
of Net Pension Liability
General Employees Retirement Fund
City's
Proportionate
Share
(Percentage) of
the Net Pension
Liability (Asset)
City's
Proportionate
Share (Amount)
of the Net
Pension Liability
(Asset)
City's
Proportionate
Share of the Net
Pension Liability
(Asset) as a
Percentage of its
Covered Payroll
6.2
2017 318,656$ 318,656$ -$ 4,248,747$ 7.5%
2016 323,436 323,436 - 4,312,480 7.5%
2015 315,859 315,859 - 4,211,453 7.5%
Note: Schedule is intended to show ten year trend. Additional years will be reported as they become available.
2017 447,205$ 447,205$ -$ 2,760,525$ 16.2%
2016 398,040 398,040 - 2,457,037 16.2%
2015 367,112 367,112 - 2,266,123 16.2%
Note: Schedule is intended to show ten year trend. Additional years will be reported as they become available.
93
Schedule of City Contributions
Public Employees Police and Fire Retirement Fund
Fiscal Year
Ending
December 31,
City of Crystal
Schedule of City Contributions
General Employees Retirement Fund
Last Ten Years
Contribution
Deficiency
(Excess)
City's Covered
Payroll
Last Ten Years
Contributions as a
Percentage of
Covered Payroll
Statutorily
Required
Contribution
Statutorily
Required
Contribution
Contributions in
Relation to the
Statutorily
Required
Contributions
Contribution
Deficiency
(Excess)
Contributions in
Relation to the
Statutorily
Required
Contributions
Fiscal Year
Ending
December 31,
City's Covered
Payroll
Contributions as a
Percentage of
Covered Payroll
6.2
City of Crystal
Notes to Required Supplementary Information
94 94
GENERAL EMPLOYEES FUND
2017 Changes
Changes in Actuarial Assumptions
• The CSA loads were changed from 0.8% for active members and 60% for vested and non-vested
deferred members. The revised CSA loads are now 0.0% for active member liability, 15% for
vested deferred member liability and 3% for non-vested deferred member liability.
• The assumed post-retirement benefit increase rate was changed from 1.0% per year for all years
to 1.0% per year through 2044 and 2.5% per year thereafter.
2016 Changes
Changes in Actuarial Assumptions
• The assumed post-retirement benefit increase rate was changed from 1.0% per year through 2035
and 2.5% per year thereafter to 1.0% per year for all future years.
• The assumed investment return was changed from 7.9% to 7.5%. The single discount rate was
changed from 7.9% to 7.5%.
• Other assumptions were changed pursuant to the experience study dated June 30, 2015. The
assumed future salary increases, payroll growth, the inflation were decreased by 0.25% to 3.25%
for payroll growth and 2.50% for inflation.
2015 Changes
Changes in Plan Provisions
• On January 1, 2015, the Minneapolis Employees Retirement Fund was merged into the General
Employees Fund, which increased the total pension liability by $1.1 billion and increased the
fiduciary plan net position by $892 million. Upon consolidation, state and employer
contributions were revised.
Changes in Actuarial Assumptions
• The assumed post-retirement benefit increase rate was changed from 1.0% per year through 2030
and 2.5% per year thereafter to 1.0% per year through 2035 and 2.5% per year thereafter.
6.2
City of Crystal
Notes to Required Supplementary Information
95 95
POLICE AND FIRE FUND
2017 Changes
Changes in Actuarial Assumptions
• Assumed salary increases were changed as recommended in the June 30, 2016 experience study.
The net effect is proposed rates that average 0.34% lower than the previous rates.
• Assumed rates of retirement were changed, resulting in fewer retirements.
• The CSA load was 30% for vested and non-vested deferred members. The CSA has been
changed to 33% for vested members and 2% for non-vested members.
• The base mortality table for healthy annuitants was changed from the RP-2000 fully generational
table to the RP-2014 fully generational table (with a base year of 2006), with male rates adjusted
by a factor of 0.96. The mortality improvement scale was changed from Scale AA to Scale MP-
2016. The base mortality table for disabled annuitants was changed from the RP-2000 disabled
mortality table to the mortality tables assumed for healthy retirees.
• Assumed termination rates were decreased to 3% for the first three years of service. Rates beyond
the select period of three years were adjusted, resulting in more expected terminations overall.
• Assumed percentage of married female members was decreased from 65% to 60%.
• Assumed age difference was changed from separate assumptions for male members (wives
assumed to be 3 years younger) and female members (husbands assumed to be 4 years older) to
the assumption that males are 2 years older than females.
• The assumed percentage of female members electing Joint and Survivor annuities was increased.
• The assumed post-retirement benefit increase rate was changed from 1% for all years to 1% per
year through 2064 and 2.5% thereafter.
2016 Changes
Changes in Actuarial Assumptions
• The assumed post-retirement benefit increase rate was changed from 1.0% per year through 2037
and 2.5% thereafter to 1.0% per year for all future years.
• The assumed investment return was changed from 7.9% to 7.5%. The single discount rate
changed from 7.9% to 5.6%.
• The assumed future salary increases, payroll growth, and inflation were decreased by 0.25% to
3.25% for payroll growth and 2.50% for inflation.
2015 Changes
Changes in Plan Provisions
• The post-retirement benefit increase to be paid after attainment of the 90% funding threshold was
changed, from inflation up to 2.5%, to a fixed rate of 2.5%.
Changes in Actuarial Assumptions
• The assumed post-retirement benefit increase rate was changed from 1.0% per year through 2030
and 2.5% per year thereafter to 1.0% per year through 2037 and 2.5% per year thereafter.
6.2
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6.2
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SUPPLEMENTARY INFORMATION
6.2
98
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6.2
99
City of Crystal
Nonmajor Governmental Funds
SPECIAL REVENUE FUNDS
Special Revenue Funds are used to account for specific revenues that are restricted to expenditures for
particular purposes.
TIF Districts
This fund accounts for activities of the City's tax increment financing (TIF) districts. The main financing
sources include tax increment revenue, interest, and transfers from other funds.
Special Projects
This fund is used to account for miscellaneous grants as well as revenues and expenditures relating to
DWI-forfeited vehicles. In addition, this fund is used to account for revenues and expenditures of funds
donated for ongoing, city-specified projects that may otherwise not be accomplished due to lack of
funding.
CAPITAL PROJECTS FUNDS
Capital Projects Funds are used to account for the acquisition and construction of major capital facilities
of the City, with the exception of those financed by Proprietary Funds.
Fire Equipment Revolving
This fund is used to accumulate funds to pay for the replacement of fire trucks. Financing sources may
include interest as well as transfers from other funds.
Street Maintenance
This fund was created to account for the cost of sealcoat and mill and overlay projects in areas of the
City where streets had previously been reconstructed. From 2016 onward, sealcoating has been
discontinued. Mill and overlay projects will be done based on street condition, rather than based on
street reconstruction phases. In addition, this fund will account for ongoing maintenance of sidewalks
and retaining walls. Financing sources may include property taxes, special assessments, interest, and
reimbursements.
Major Building Replacement Fund
This fund is used to account for major renovation and/or construction of City buildings.
Park Improvement
This fund is used to accumulate funds to pay for park improvements. The main financing sources include
property taxes and interest.
Cable TV Equipment
This fund is used to accumulate funds to pay for equipment and expenses related to TV broadcast of city
council meetings. The main financing sources include grants and interest.
6.2
TIF Districts
Special Rev
Special
Projects Total
Assets
Cash and investments 1,817,122$ 98,913$ 1,916,035$
Accounts receivable - 2,760 2,760
Taxes receivable - - -
Special assessments receivable - - -
Due from other governments - 11,046 11,046
Total assets 1,817,122$ 112,719$ 1,929,841$
Liabilities
Accounts payable 6,263$ 10,971$ 17,234$
Due to other funds - - -
Due to other governments 42,164 - 42,164
Total liabilities 48,427 10,971 59,398
Deferred Inflows of Resources
Unavailable revenue - property taxes - - -
Unavailable revenue - special assessments - - -
Total deferred inflows of resources - - -
Fund Balances
Restricted 1,768,695 27,824 1,796,519
Committed - - -
Assigned - 73,924 73,924
Total fund balances 1,768,695 101,748 1,870,443
Total liabilities, deferred inflow of
resouces, and fund balances 1,817,122$ 112,719$ 1,929,841$
100
December 31, 2017
Special Revenue
City of Crystal
Combining Balance Sheet -
Nonmajor Governmental Funds
6.2
Street
Maintenance
Major
Building
Replacement
Park
Improvement
Cable TV
Equipment Total
Total
Governmental
Funds
1,696,364$ 644,615$ 210,780$ 108,477$ 2,660,236$ 4,576,271$
- - - 2,973 2,973 5,733
- - 4,471 - 4,471 4,471
275,566 - - - 275,566 275,566
- - 1,903 - 1,903 12,949
1,971,930$ 644,615$ 217,154$ 111,450$ 2,945,149$ 4,874,990$
-$ -$ -$ -$ -$ 17,234$
- - - - - -
- - - - - 42,164
- - - - - 59,398
- - 4,471 - 4,471 4,471
274,956 - - - 274,956 274,956
274,956 - 4,471 - 279,427 279,427
- - - - - 1,796,519
1,696,974 644,615 212,683 111,450 2,665,722 2,665,722
- - - - - 73,924
1,696,974 644,615 212,683 111,450 2,665,722 4,536,165
1,971,930$ 644,615$ 217,154$ 111,450$ 2,945,149$ 4,874,990$
101
Capital Projects
6.2
Capital Projects
TIF Districts
Special Rev
Special
Projects Total
Fire
Equipment
Revolving
Revenues
Property taxes 230,143$ -$ 230,143$ -$
Special assessments - - - -
Intergovernmental - 22,350 22,350 -
Fine and forfeitures - 34,745 34,745 -
Miscellaneous
Interest 15,141 - 15,141 (1,427)
Other - 51,511 51,511 -
Total revenues 245,284 108,606 353,890 (1,427)
Expenditures
Current
General government - 16,826 16,826 -
Public safety - 56,096 56,096 -
Public works - - - -
Culture and recreation - 7,420 7,420 -
Economic development 120,890 - 120,890 -
Debt service
Principal 88,341 - 88,341 -
Interest and other charges 51,228 - 51,228 -
Capital outlay - 31,192 31,192 -
Total expenditures 260,459 111,534 371,993 -
Excess of revenues over
(under) expenditures (15,175) (2,928) (18,103) (1,427)
Other Financing Sources (Uses)
Transfers in - 3,186 3,186 -
Transfers out - - - (584,478)
Total other financing
sources (uses)- 3,186 3,186 (584,478)
Net change in fund balances (15,175) 258 (14,917) (585,905)
Fund Balances
Beginning of year 1,783,870 101,490 1,885,360 585,905
End of year 1,768,695$ 101,748$ 1,870,443$ -$
102
Special Revenue
City of Crystal
Combining Statement of Revenues, Expenditures, and Changes
in Fund Balances - Nonmajor Governmental Funds
Year Ended December 31, 2017
6.2
Capital Projects
Street
Maintenance
Major
Building
Replacement
Park
Improvement
Cable TV
Equipment Total
Total Other
Governmental
Funds
163,600$ 574,400$ -$ -$ 738,000$ 968,143$
80,869 - - - 80,869 80,869
- - - 38,120 38,120 60,470
- - - - - 34,745
-
14,012 2,111 - 799 15,495 30,636
18,133 - - - 18,133 69,644
276,614 576,511 - 38,919 890,617 1,244,507
- - - - - 16,826
- - - - - 56,096
169,902 - - - 169,902 169,902
- - - - - 7,420
- - - - - 120,890
-
- - - - - 88,341
- - - - - 51,228
- 37,405 - - 37,405 68,597
169,902 37,405 - - 207,307 579,300
106,712 539,106 - 38,919 683,310 665,207
- - 212,683 - 212,683 215,869
- - - - (584,478) (584,478)
- - 212,683 - (371,795) (368,609)
106,712 539,106 212,683 38,919 311,515 296,598
1,590,262 105,509 - 72,531 2,354,207 4,239,567
1,696,974$ 644,615$ 212,683$ 111,450$ 2,665,722$ 4,536,165$
103
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual
TIF Districts - Special Revenue
Year Ended December 31, 2017
Original Final
Actual
Amounts
Revenues
Property taxes 180,000$ 180,000$ 230,143$ 50,143$
Miscellaneous revenues
Interest 17,520 17,520 15,141 (2,379)
Total revenues 197,520 197,520 245,284 47,764
Expenditures
Current
Community development 427,270 427,270 120,890 (306,380)
Debt service
Principal 88,341 88,341 88,341 -
Interest and other charges 51,228 51,228 51,228 -
Total expenditures 566,839 566,839 260,459 (306,380)
Excess of revenues
under expenditures (369,319)$ (369,319)$ (15,175) 354,144$
Fund Balance
Beginning of year 1,783,870
End of year 1,768,695$
104
Budgeted Amounts
Variance with
Final Budget
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual
Special Projects - Special Revenue
Year Ended December 31, 2017
Original Final
Actual
Amounts
Revenues
Intergovernmental 27,000$ 27,000$ 16,554$ (10,446)$
Fine and forfeitures 21,000 21,000 34,745 13,745
Other aids and grants - - 5,796 5,796
Miscellaneous 28,300 28,300 51,511 23,211
Total revenues 76,300 76,300 108,606 32,306
Expenditures
Current
General government 28,300 28,300 16,826 (11,474)
Public safety 48,000 48,000 56,096 8,096
Park and recreation - - 7,420 7,420
Capital outlay - - 31,192 31,192
Total expenditures 76,300 76,300 111,534 35,234
Excess of revenues
under expenditures - - (2,928) (2,928)
Other Financing Sources (Uses)
Transfers in - - 3,186 3,186
Net change in fund balances -$ -$ 258 258$
Fund Balance
Beginning of year 101,490
End of year 101,748$
105
Budgeted Amounts
Variance with
Final Budget
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual
Police Equipment Revolving - Capital Projects
Year Ended December 31, 2017
Original Final
Actual
Amounts
Revenues
Property taxes 137,400$ 137,400$ 137,400$ -$
Intergovernmental 3,000 3,000 - (3,000)
Interest 42,000 42,000 26,492 (15,508)
Miscellaneous revenues - - 2,500 2,500
Total revenues 182,400 182,400 166,392 (16,008)
Expenditures
Current
Public safety - - 28,329 28,329
Capital outlay 209,900 209,900 396,579 186,679
Total expenditures 209,900 209,900 424,908 215,008
Excess of revenues
under expenditures (27,500) (27,500) (258,516) (231,016)
Other Financing Sources (Uses)
Proceeds from sale of capital asset 15,000 15,000 20,876 5,876
Net change in fund balances (12,500)$ (12,500)$ (237,640) (225,140)$
Fund Balance
Beginning of year 3,108,331
End of year 2,870,691$
106
Budgeted Amounts
Variance with
Final Budget
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual
Fire Equipment Revolving - Capital Projects
Year Ended December 31, 2017
Original Final Actual Amounts
Revenues
Investment income 7,200$ 7,200$ (1,427)$ (8,627)$
Other Financing Sources (Uses)
Transfers out - - (584,478) (584,478)
Net change in fund balances 7,200$ 7,200$ (585,905) (593,105)$
Fund Balance
Beginning of year 585,905
End of year -$
107
Budgeted Amounts Variance with
Final Budget
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual
Street Maintenance - Capital Projects
Year Ended December 31, 2017
Original Final Actual Amounts
Revenues
Property taxes 163,600$ 163,600$ 163,600$ -$
Special assessments 94,192 94,192 80,869 (13,323)
Interest 35,441 35,441 14,012 (21,429)
Miscellaneous revenues 62,533 62,533 18,133 (44,400)
Total revenues 355,766 355,766 276,614 (79,152)
Expenditures
Current
Public works 102,640 102,640 169,902 67,262
Total expenditures 102,640 102,640 169,902 67,262
Excess of revenues
over expenditures 253,126$ 253,126$ 106,712 (146,414)$
Fund Balance
Beginning of year 1,590,262
End of year 1,696,974$
108
Budgeted Amounts Variance with
Final Budget
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual
Major Building Replacement - Capital Projects
Year Ended December 31, 2017
Original Final Actual Amounts
Revenues
Property taxes 563,153$ 563,153$ 574,400$ 11,247$
Investment income - - 2,111 2,111
Total revenues 563,153 563,153 576,511 13,358
Expenditures
Capital outlay 1,754 1,754 37,405 35,651
Total expenditures 1,754 1,754 37,405 35,651
Excess of revenues
over expenditures 561,399$ 561,399$ 539,106 (22,293)$
Fund Balance
Beginning of year 105,509
End of year 644,615$
109
Budgeted Amounts Variance with
Final Budget
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual
Park Improvement - Capital Projects
Year Ended December 31, 2017
Original Final Actual Amounts
Other Financing Sources
Transfers in -$ -$ 212,683 212,683$
Fund Balance
Beginning of year -
End of year 212,683$
110
Budgeted Amounts Variance with
Final Budget
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual
Cable TV Equipment - Capital Projects
Year Ended December 31, 2017
Original Final Actual Amounts
Revenues
Intergovernmental 32,000$ 32,000$ 38,120$ 6,120$
Interest 320 320 799 479
Total revenues 32,320 32,320 38,919 6,599
Excess of revenues
over expenditures 32,320$ 32,320$ 38,919 6,599$
Fund Balance
Beginning of year 72,531
End of year 111,450$
111
Budgeted Amounts Variance with
Final Budget
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual
Debt Service
Year Ended December 31, 2017
Original Final Actual Amounts
Revenues
Property taxes 212,000$ 212,000$ 212,025$ 25$
Special assessments 2,055,216 2,055,216 2,094,566 39,350
Interest 51,603 51,603 41,639 (9,964)
Total revenues 2,318,819 2,318,819 2,348,230 29,411
Expenditures
Debt service
Principal 1,880,000 1,880,000 1,880,000 -
Interest and other charges 440,591 440,591 426,068 (14,523)
Total expenditures 2,320,591 2,320,591 2,306,068 (14,523)
Excess of revenues over
(under) expenditures (1,772) (1,772) 42,162 43,934
Other Financing Sources (Uses)
Transfers in 480,000 480,000 474,064 (5,936)
Transfers out - - (954,272) (954,272)
Total other financing
Sources (uses)480,000 480,000 (480,208) (960,208)
Net change in fund balances 478,228$ 478,228$ (438,046) (916,274)$
Fund Balance
Beginning of year 5,750,342
End of year 5,312,296$
112
Budgeted Amounts Variance with
Final Budget
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual
Capital Improvement Revolving - Capital Projects
Year Ended December 31, 2017
Original Final Actual Amounts
Revenues
Property taxes 266,220$ 266,220$ 266,220$ -$
Special assessments 121,150 121,150 200,488 79,338
Intergovernmental 249,674 249,674 239,674 (10,000)
Interest 73,006 73,006 70,721 (2,285)
Total revenues 710,050 710,050 777,103 67,053
Expenditures
Capital outlay 1,127,800 1,127,800 1,060,448 (67,352)
Total expenditures 1,127,800 1,127,800 1,060,448 (67,352)
Excess of revenues
under expenditures (417,750) (417,750) (283,345) 134,405
Other Financing Sources (Uses)
Proceeds from sale of capital asset 24,000 24,000 69,405 45,405
Transfers in 68,000 68,000 68,000 -
Total other financing
sources (uses)92,000 92,000 137,405 45,405
Net change in fund balances (325,750)$ (325,750)$ (145,940) 179,810$
Fund Balance
Beginning of year 8,357,889
End of year 8,211,949$
113
Budgeted Amounts Variance with
Final Budget
6.2
City of Crystal
Statement of Revenues, Expenditures, and
Changes in Fund Balances -
Budget and Actual
Street Reconstruction - Capital Projects
Year Ended December 31, 2017
Original Final Actual Amounts
Revenues
Special assessments 1,714,586 1,714,586 2,033,012 318,426
Intergovernmental 600,000 600,000 830,255 230,255
Investment income 22,687 22,687 25,691 3,004
Miscellaneous revenues - - 226,441 226,441
Total revenues 2,337,273 2,337,273 3,115,399 778,126
Expenditures
Public works - capital outlay 7,820,187 7,820,187 8,135,122 314,935
Debt service - - 74,171 74,171
Total expenditures 7,820,187 7,820,187 8,209,293 389,106
Excess of revenues
under expenditures (5,482,914) (5,482,914) (5,093,894) 389,020
Other Financing Sources (Uses)
Issuance of bonds 4,156,552 4,156,552 4,665,000 508,448
Bond premium - - 273,843 273,843
Transfers in - - 741,589 741,589
Total other financing
sources (uses)4,156,552 4,156,552 5,680,432 1,523,880
Net change in fund balances (1,326,362)$ (1,326,362)$ 586,538 1,912,900$
Fund Balance
Beginning of year 2,132,454
End of year 2,718,992$
114
Budgeted Amounts Variance with
Final Budget
6.2
115
City of Crystal
Fiduciary Funds
Agency funds are used to account for resources held by the City in a purely custodial capacity (assets
equal liabilities).
Hennepin Recycling Group
This fund is used to account for the collection, recycling, and disposal of solid waste activities of the
Hennepin Recycling Group.
6.2
01/01/17 Additions Deductions 12/31/17
Assets
Cash and investments 1,704,244$ 1,160,213$ 1,464,921$ 1,399,536$
Accrued interest 2,088 12,729 14,817 -
Due from other governments - 92,909 - 92,909
Total assets 1,706,332 1,265,851 1,479,738 1,492,445
Liabilities
Accounts payable $ 41,033 49,991$ 41,033$ $ 49,991
Due to Hennepin Recycling Group 1,665,299 1,215,860 1,438,705 1,442,454
Total liabilities 1,706,332 1,265,851 1,479,738 1,492,445
116
City of Crystal
Statement of Changes in Agency Fund Assets and Liabilities
Year Ended December 31, 2017
Hennepin Recycling Group
6.2
117
STATISTICAL SECTION
6.2
118
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6.2
Table 1
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Governmental Activities
Net investment in capital assets 26,770,028$ 26,770,714$ 26,510,303$ 25,896,999$ 26,574,766$ 28,944,085$ 34,052,606$ 39,903,269$ 40,421,924$ 40,534,551$
Restricted 11,819,634 13,971,055 13,110,714 13,618,934 14,772,670 17,707,336 16,360,362 18,102,105 18,580,900 20,099,040
Unrestricted 39,002,515 39,960,809 39,847,074 43,259,125 43,950,199 43,687,744 39,694,502 25,901,804 25,370,751 24,388,020
Total governmental activities net position 77,592,177$ 80,702,578$ 79,468,091$ 82,775,058$ 85,297,635$ 90,339,165$ 90,107,470$ 83,907,178$ 84,373,575$ 85,021,611$
Business-Type Activities
Net investment in capital assets 8,327,940$ 11,482,129$ 11,450,442$ 12,763,559$ 13,921,133$ 15,655,823$ 15,448,191$ 19,057,632$ 19,889,415$ 22,283,455$
Restricted - - - - - - - - - -
Unrestricted 13,815,233 10,912,321 11,563,188 11,319,800 10,416,828 10,114,825 9,397,654 7,484,722 8,575,762 9,572,606
Total business-type activities net position 22,143,173$ 22,394,450$ 23,013,630$ 24,083,359$ 24,337,961$ 25,770,648$ 24,845,845$ 26,542,354$ 28,465,177$ 31,856,061$
Primary Government
Net investment in capital assets 35,097,968$ 38,252,843$ 37,960,745$ 38,660,558$ 40,495,899$ 44,599,908$ 49,500,797$ 58,960,901$ 60,311,339$ 62,818,006$
Restricted 11,819,634 13,971,055 13,110,714 13,618,934 14,772,670 17,707,336 16,360,362 18,102,105 18,580,900 20,099,040
Unrestricted 52,817,748 50,873,130 51,410,262 54,578,925 54,367,027 53,802,569 49,092,156 33,386,526 33,946,513 33,960,626
Total primary government net position 99,735,350$ 103,097,028$ 102,481,721$ 106,858,417$ 109,635,596$ 116,109,813$ 114,953,315$ 110,449,532$ 112,838,752$ 116,877,672$
1
1
9
(unaudited)
City of Crystal
Net Position By Component
(Accrual Basis of Accounting)
Last Ten Fiscal Years
6.2
Table 2
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Expenses
Governmental activities
General government 2,244,098$ 2,057,275$ 2,115,117$ 2,084,038$ 1,992,060$ 2,091,395$ 2,767,171$ 2,646,651$ 3,226,278$ 2,964,731$
Public safety 5,205,078 5,317,912 5,979,472 6,247,082 5,605,172 5,900,593 6,085,801 6,438,462 7,685,700 7,546,777
Public works 3,520,939 5,646,176 6,075,243 3,997,978 4,345,225 2,655,529 5,034,894 5,132,260 6,511,486 4,224,253
Parks and recreation 2,481,244 2,467,528 2,494,542 2,475,881 2,110,078 2,548,785 2,622,407 2,816,220 2,759,211 3,128,275
Community development 3,348,828 2,839,775 1,656,365 2,168,725 2,180,213 1,570,132 1,358,486 1,287,427 1,174,426 1,616,752
Interest on long-term debt 603,715 501,300 531,689 503,301 498,884 586,388 529,448 555,121 563,308 541,919
Total governmental activities expenses 17,403,902$ 18,829,966$ 18,852,428$ 17,477,005$ 16,731,632$ 15,352,822$ 18,398,207$ 18,876,141$ 21,920,409$ 20,022,707$
Business-type activities
Water 2,199,371$ 2,679,141$ 2,482,146$ 2,930,591$ 3,094,744$ 3,092,654$ 3,928,301$ 4,131,931$ 3,047,910$ 2,970,228$
Sanitary sewer 1,879,187 2,073,968 1,934,868 1,928,975 1,874,699 1,927,664 1,931,725 1,995,561 2,169,072 2,144,581
Storm drainage 429,906 1,019,228 501,194 600,371 782,897 760,372 662,419 883,284 903,884 809,169
Street lights 177,313 170,521 148,627 186,991 173,308 309,396 169,664 151,305 155,056 174,479
Recycling 303,729 318,487 322,072 331,918 329,106 329,131 324,105 324,393 324,496 324,853
Total business-type activities expenses 4,989,506 6,261,345 5,388,907 5,978,846 6,254,754 6,419,217 7,016,214 7,486,474 6,600,418 6,423,310
Total primary government expenses 22,393,408$ 25,091,311$ 24,241,335$ 23,455,851$ 22,986,386$ 21,772,039$ 25,414,421$ 26,362,615$ 28,520,827$ 26,446,017$
Program Revenues
Governmental activities
Charges for services
General government 285,934$ 232,748$ 205,696$ 278,336$ 240,501$ 256,133$ 354,802$ 228,357$ 320,899$ 279,603$
Public safety 299,699 324,387 305,692 357,536 389,769 429,740 438,328 412,016 411,592 380,498
Public works - 14,504 13,832 - - 9 303 - - -
Parks and recreation 488,544 433,300 447,166 437,259 463,259 500,561 465,769 483,741 515,056 513,457
Community development 1,683,780 1,066,609 848,120 668,666 665,503 902,000 1,739,829 761,469 767,755 796,152
Operating grants and contributions 451,677 554,288 854,645 1,140,876 1,164,000 667,622 595,463 634,881 728,449 659,450
Capital grants and contributions 4,461,854 6,550,860 2,977,318 5,750,178 6,008,708 6,877,723 2,613,480 5,533,872 7,393,250 7,473,350
Total governmental activities program revenues 7,671,488$ 9,176,696$ 5,652,469$ 8,632,851$ 8,931,740$ 9,633,788$ 6,207,974$ 8,054,336$ 10,137,001$ 10,102,510$
Business-type activities
Charges for services
Water 2,690,721$ 2,872,639$ 2,607,834$ 2,549,324$ 2,790,363$ 2,637,830$ 2,601,186$ 2,962,818$ 3,076,263$ 3,138,317$
Sanitary sewer 1,890,849 1,887,052 1,856,830 1,913,165 1,919,725 1,939,539 2,020,522 2,079,431 2,193,599 2,300,866
Storm drainage 622,182 641,031 648,338 653,009 676,265 717,005 760,884 809,067 867,598 1,058,549
Street lights 150,936 154,708 161,702 162,722 162,119 169,015 181,720 186,125 191,261 195,122
Recycling 315,173 330,626 324,935 334,654 335,214 334,162 334,101 334,493 334,926 340,250
Operating grants and contributions 191,073 153,868 171,337 375,631 336,103 414,534 388,648 1,669,332 1,859,532 680,740
Capital grants and contributions - - 71,385 938,060 1,695 1,319,522 11,612 - - -
Total business-type activities program revenues 5,860,934 6,039,924 5,842,361 6,926,565 6,221,484 7,531,607 6,298,673 8,041,266 8,523,179 7,713,844
Total primary government program revenues 13,532,422$ 15,216,620$ 11,494,830$ 15,559,416$ 15,153,224$ 17,165,395$ 12,506,647$ 16,095,602$ 18,660,180$ 17,816,354$
1
2
0
City of Crystal
Changes in Net Position
(Accrual Basis of Accounting)
Last Ten Fiscal Years
(unaudited)
6.2
Table 2
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
City of Crystal
Changes in Net Position
(Accrual Basis of Accounting)
Last Ten Fiscal Years
(unaudited)
Net (Expense) Revenue
Governmental activities (9,732,414)$ (9,653,270)$ (13,199,959)$ (8,844,154)$ (7,799,892)$ (5,719,034)$ (12,190,233)$ (10,821,805)$ (11,783,408)$ (9,920,197)$
Business-type activities 871,428 (221,421)453,454 947,719 (33,270)1,112,390 (717,541)554,792 1,922,761 1,290,534
Total primary government net expense (8,860,986)$ (9,874,691)$ (12,746,505)$ (7,896,435)$ (7,833,162)$ (4,606,644)$ (12,907,774)$ (10,267,013)$ (9,860,647)$ (8,629,663)$
General Revenues and Other Changes
in Net Position
Governmental activities
Property taxes 9,478,922$ 9,854,813$ 9,231,751$ 9,318,013$ 9,710,807$ 9,561,519$ 9,621,212$ 9,670,252$ 9,955,391$ 10,469,019$
Grants and contributions not restricted
to specific programs 1,821,550 2,074,108 1,616,214 1,618,291 1,478,220 1,472,223 1,664,043 1,701,220 1,712,591 1,753,898
Unrestricted investment earnings 1,773,833 991,016 1,025,552 1,036,201 540,883 96,678 350,648 303,263 445,296 302,344
Gain on disposition of capital assets 11,690 28,242 21,072 38,413 45,139 47,080 48,900 27,706 82,795 91,114
Transfers (703,146)(184,508)70,883 140,203 (177,580)(252,756)273,735 (1,577,880)53,732 (2,048,142)
Total governmental activities 12,382,849$ 12,763,671$ 11,965,472$ 12,151,121$ 11,597,469$ 10,924,744$ 11,958,538$ 10,124,561$ 12,249,805$ 10,568,233$
Business-type activities
Unrestricted investment earnings 500,723$ 283,159$ 236,609$ 240,213$ 108,888$ 16,241$ 66,473$ 53,517$ 47,353$ 42,244$
Gain on disposition of capital assets 2,650 5,031 - 22,000 1,404 51,300 - 12,500 6,441 9,964
Transfers 703,146 184,508 (70,883)(140,203)177,580 252,756 (273,735)1,577,880 (53,732)2,048,142
Total business-type activities 1,206,519 472,698 165,726 122,010 287,872 320,297 (207,262)1,643,897 62 2,100,350
Total primary government 13,589,368$ 13,236,369$ 12,131,198$ 12,273,131$ 11,885,341$ 11,245,041$ 11,751,276$ 11,768,458$ 12,249,867$ 12,668,583$
Change in Net Position
Governmental activities 2,650,435$ 3,110,401$ (1,234,487)$ 3,306,967$ 3,797,577$ 5,205,710$ (231,695)$ (697,244)$ 466,397$ 648,036$
Business-type activities 2,077,947 251,277 619,180 1,069,729 254,602 1,432,687 (924,803)2,198,689 1,922,823 3,390,884
Total primary government 4,728,382$ 3,361,678$ (615,307)$ 4,376,696$ 4,052,179$ 6,638,397$ (1,156,498)$ 1,501,445$ 2,389,220$ 4,038,920$
1
2
1
6.2
Table 3
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
General Fund
Nonspendable
Inventory -$ -$ -$ -$ -$ -$ -$ 27,488$ 15,519$ 19,169$
Committed
Compensated absences - - - 869,801 882,942 840,514 801,697 782,627 817,760 753,962
Unreserved 6,713,244 7,405,422 7,613,583 - - - - -
Unassigned - - - 6,645,169 6,514,525 6,862,599 6,594,097 6,382,810 6,220,496 6,119,325
Total general fund 6,713,244$ 7,405,422$ 7,613,583$ 7,514,970$ 7,397,467$ 7,703,113$ 7,395,794$ 7,192,925$ 7,053,775$ 6,892,456$
All Other Governmental Funds
Reserved 4,127,667$ 5,252,033$ 5,383,786$ -$ -$ -$ -$ -$ -$ -$
Nonspendable
Prepaid items - - - - - 78,455 - 8,450 - -
Restricted
Housing and redevelopment
assistance - - - 2,468,311 1,595,856 1,593,243 1,655,414 1,703,927 1,783,870 1,768,695
Murl revolving fund - - - 29,775 32,852 35,651 39,519 - - -
Debt service - - - 3,831,273 4,405,942 5,440,681 5,528,971 6,437,512 5,750,342 5,312,296
10% lawful gambling contrib.- - - 6,323 3,795 1,945 445 - - -
Dwi-related enforcement,
training, and education - - - 38,188 41,723 59,357 55,399 40,626 32,375 27,824
Committed
Housing and redevelopment
assistance - - - 3,541,003 3,754,395 3,914,649 3,974,329 4,247,836 4,215,316 3,846,024
Cap. Outlay - city wide - - - 8,607,284 8,848,629 8,647,926 8,632,632 8,498,360 8,357,889 8,211,949
Cap. Outlay - replace. and
renovation of city bldgs.- - - 9,645,755 10,308,963 10,286,268 6,964,198 - 105,509 644,615
Cap. Outlay - street
reconstruction - - - 4,028,317 2,463,377 2,261,153 2,347,934 2,074,645 2,132,454 2,718,992
Cap. Outlay - police equip.- - - 3,184,679 3,191,297 3,138,748 3,122,050 3,126,443 3,108,331 2,870,691
Cap. Outlay - cable TV equip.- - - - - - - 35,487 72,531 111,450
Cap. Outlay - fire equip.- - - 629,063 636,661 637,970 643,352 648,635 585,905 212,683
Cap. Outlay - street maint.- - - 1,908,638 1,872,925 1,854,710 1,251,683 1,420,778 1,590,262 1,696,974
Assigned
Police Dept. Purposes - - - 7,138 32,058 18,531 14,873 22,453 40,631 40,631
Park and Rec. Dept. Purposes - - - 33,275 25,805 26,718 24,686 23,684 20,729 20,729
Other purposes - - - 12,275 12,371 11,855 8,060 9,042 7,755 12,564
Unassigned - - - - - - - (626,968)
Unreserved, reported in
Special revenue funds 5,127,735 4,702,340 5,158,888 - - - - -
Capital projects funds 26,055,543 26,544,020 25,553,862 - - - - -
Total all other Governmental Funds 35,310,945$ 36,498,393$ 36,096,536$ 37,971,297$ 37,226,649$ 38,007,860$ 34,263,545$ 27,670,910$ 27,803,899$ 27,496,117$
Note: The City implemented GASB Statement No. 54 in 2011. Years prior to 2011 have not been restated.
1
2
2
City of Crystal
Fund Balances of Governmental Funds
(Modified Accrual Basis of Accounting)
Last Ten Fiscal Years
(unaudited)
6.2
Table 4
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revenues
Property taxes 9,433,491$ 9,844,690$ 9,200,159$ 9,323,325$ 9,714,591$ 9,641,513$ 9,621,688$ 9,664,690$ 9,966,978$ 10,569,176$
Special assessments 2,121,616 3,034,025 2,102,306 2,718,038 3,540,032 3,467,243 2,873,099 3,328,989 3,950,081 4,468,266
Licenses, permits and inspections 674,256 616,527 666,542 674,693 670,162 843,741 924,967 808,695 773,479 785,451
Intergovernmental 2,562,007 2,553,124 3,043,371 3,944,380 2,508,451 3,046,762 2,930,382 3,175,821 3,062,273 3,133,642
Charges for sales and/or services 1,849,086 1,085,841 769,153 759,262 826,023 899,525 1,718,581 932,081 913,329 859,087
Administrative services provided to other funds 260,226 303,159 273,653 294,594 278,835 291,368 - - - -
Fines and forfeitures 269,345 404,871 426,922 353,125 316,496 397,759 405,546 355,566 322,009 359,917
Interest 1,736,086 1,165,835 913,481 801,534 669,524 473,660 331,758 291,400 245,865 259,657
Net increase (decrease) in fair value
of investments 37,747 (202,228)84,828 206,953 (142,882)(379,426)9,442 4,825 59,015 -
Miscellaneous 287,955 1,036,102 484,731 379,636 450,274 502,878 111,496 409,295 1,046,909 354,302
Total revenues 19,231,815 19,841,946 17,965,146 19,455,540 18,831,506 19,185,023 18,926,959 18,971,362 20,339,938 20,789,498
Expenditures
General government 2,036,128 2,062,105 2,019,487 1,898,990 2,030,717 2,158,164 2,198,872 2,289,245 2,517,924 2,639,028
Public safety 4,942,650 5,068,676 5,722,179 5,992,955 5,429,833 5,679,203 5,692,868 5,841,029 6,143,480 6,589,235
Public works 1,070,172 1,169,753 1,912,121 1,450,552 1,315,019 1,311,719 2,246,292 1,327,418 2,077,476 1,455,074
Parks and recreation 1,946,874 1,919,783 1,948,935 1,955,070 1,978,397 2,029,179 2,081,162 2,229,890 2,240,202 2,379,532
Community development 1,131,500 1,451,652 1,425,627 1,382,770 1,408,056 1,464,562 1,252,952 1,197,652 1,108,920 1,279,318
Capital outlay 7,838,976 9,247,869 4,112,480 4,528,799 7,052,365 7,327,877 7,209,039 14,022,519 7,124,563 9,829,622
Debt service -
Principal 2,464,034 1,118,889 1,599,619 1,810,083 1,500,682 1,358,811 2,275,042 1,379,264 2,481,027 1,968,341
Interest and other fees 608,505 507,246 549,775 529,299 538,947 564,181 554,063 536,202 591,516 551,467
Total expenditures 22,038,839 22,545,973 19,290,223 19,548,518 21,254,016 21,893,696 23,510,290 28,823,219 24,285,108 26,691,617
Excess (Deficiency) of Revenues
Over (Under) Expenditures (2,807,024)(2,704,027)(1,325,077)(92,978)(2,422,510)(2,708,673)(4,583,331)(9,851,857)(3,945,170)(5,902,119)
Other Financing Sources (Uses)
Issuance of bonds 2,190,000 4,564,778 1,000,222 1,705,000 2,635,000 3,630,000 - 2,550,000 3,330,000 4,665,000
Issuance of refunding bonds - - 1,204,778 - - - - - - -
Issuance of notes payable - - 58,501 - - - - - - -
Refunded bonds redeemed - - (1,204,778)- - - - - - -
Premium on bonds issued - - - - 70,531 58,626 - 92,777 99,664 273,843
Proceeds from sale of property and equipment 18,716 28,592 32,158 41,314 56,169 57,310 82,547 33,224 122,359 91,114
Discount on bonds issued (1,069)(43,680)- (17,391)- - - - - -
Transfers in 2,974,226 987,463 1,135,907 1,646,572 2,865,486 895,350 2,347,933 931,436 673,132 1,944,997
Transfers out (2,520,300)(953,500)(1,095,407)(1,506,369)(2,791,827)(845,756)(1,898,783)(551,084)(286,146)(1,541,936)
Total other financing sources (uses)2,661,573 4,583,653 1,131,381 1,869,126 2,835,359 3,795,530 531,697 3,056,353 3,939,009 5,433,018
Net Change in Fund Balances (145,451)$ 1,879,626$ (193,696)$ 1,776,148$ 412,849$ 1,086,857$ (4,051,634)$ (6,795,504)$ (6,161)$ (469,101)$
Debt service as a percentage of noncapital
expenditures 17%9%13%14%13%14%17%11%17%13%
1
2
3
(unaudited)
City of Crystal
Changes in Fund Balances of Governmental Funds
(Modified Accrual Basis of Accounting)
Last Ten Fiscal Years
6.2
Table 5
City of Crystal
Taxable and Estimated Market Values of Taxable Property
Last Ten Fiscal Years
(unaudited)
Total Taxable
Market Value
Total as a Percent
Real Property Total Direct Estimated of Estimated
Fiscal Commercial Personal Taxable Tax Actual Actual
Year Residential Apartments Industrial Property Market Value Rate Market Value Market Value
2008 1,557,426,100 112,622,000 190,934,900 12,133,500 1,873,116,500$ 36.564 1,875,651,300$ 99.86%
2009 1,480,780,567 111,623,000 190,548,200 11,717,000 1,794,668,767 39.789 1,799,864,267 99.71%
2010 1,359,108,500 109,744,000 177,950,600 11,371,300 1,658,174,400 44.270 1,663,404,700 99.69%
2011 1,214,915,800 #101,790,000 162,932,900 11,554,800 1,491,193,500 48.764 1,496,063,900 99.67%
2012 1,019,240,647 #100,691,000 161,022,000 11,783,600 1,292,737,247 52.929 1,457,765,100 88.68%
2013 864,841,494 #100,076,440 159,257,200 12,586,700 1,136,761,834 57.630 1,311,691,400 86.66%
2014 864,287,852 101,813,000 156,849,300 12,661,700 1,135,611,852 56.015 1,440,635,800 78.83%
2015 1,020,212,713 104,420,800 155,744,300 13,315,900 1,293,693,713 50.498 1,484,886,100 87.12%
2016 1,153,327,871 154,241,560 159,609,700 13,517,900 1,480,697,031 53.207 1,620,984,300 91.35%
2017 1,280,234,014 167,116,280 174,031,700 13,517,900 (1)1,634,899,894 50.360 1,767,035,000 92.52%
(1) Hennepin County has not updated this database for 2017 - number reflects 2016
Source: Hennepin County
1
2
4
6.2
Table 6
City of Crystal
Property Tax Rates -
Direct and Overlapping Governments
Last Ten Fiscal Years
(unaudited)
Total Total Crystal Robbinsdale
City Tax Debt Service ISD #281 Total
Fiscal Basic G.O.Direct Robbinsdale Hennepin Special Capacity Market Market Overlapping
Year Rate HRA Debt Service Tax Rate ISD #281 County Districts *Tax Rate Value Rate Value Rate Tax Rate
2008 35.441 1.123 0.000 36.564 27.243 38.571 7.397 109.775 0.012 0.137 109.924
2009 38.288 1.501 0.000 39.789 27.214 40.413 7.154 114.570 0.012 0.237 114.819
2010 40.285 1.400 2.585 44.270 28.621 42.640 8.138 123.669 0.013 0.229 123.911
2011 44.529 1.418 2.817 48.764 34.387 45.840 9.172 138.163 0.014 0.231 138.408
2012 48.219 1.588 3.122 52.929 32.810 48.231 9.523 143.493 0.015 0.276 143.784
2013 52.520 1.480 3.630 57.630 32.347 49.461 10.089 149.527 0.016 0.297 149.840
2014 51.268 1.241 3.506 56.015 34.777 49.959 10.561 151.312 0.016 0.303 151.631
2015 49.100 1.398 0.000 50.498 33.226 46.398 9.785 139.907 0.015 0.285 140.207
2016 51.831 1.376 0.000 53.207 33.833 45.356 9.530 141.926 0.014 0.282 142.222
2017 48.949 1.411 0.000 50.360 31.612 44.087 9.319 135.378 0.013 0.250 135.641
Note:Information reflects total tax rates levied by each entity. Tax rates are expressed in terms of "net tax capacity."
A property's tax capacity is determined by multiplying its taxable market value by a state-determined class rate.
Class rates vary by property type and change periodically based on state legislation.
*Includes Metropolitan Council, Metropolitan Transit, Metropolitan Mosquito Control, Hennepin Parks, Park Museum,
and the Hennepin County Regional Railroad Authority.
Source: Hennepin County
City Direct Tax Rates
1
2
5
6.2
Table 7
Percentage Percentage
Tax Of Total Tax Tax Of Total Tax
Taxpayer Type of Property Capacity *Rank Capacity Capacity *Rank Capacity
Crystal Shopping Center Assoc.Shopping Center $432,970 1 2.59%$419,250 1 1.96%
Crystal Gallery Developers Shopping Center 215,970 2 1.29%159,250 6 0.74%
Crystal Village Apartments, LLC Apartments 213,838 3 1.28%189,538 4 0.89%
Calibre Chase Ptnrs Ltd Apartments 184,613 4 1.10%
Crystal Medical Building, LLC Office/clinic 180,850 5 1.08%
Smith-Sturm Investment Co.Apartments 176,063 6 1.05%140,013 7 0.65%
Target Corporation Department Store 159,250 7 0.95%205,250 3 0.96%
Crystal Leased HSG Assoc.Housing 148,905 8 0.89%
SuperValu, Inc.Grocery Store 145,330 9 0.87%169,250 5 0.79%
Minnesota Senior Living LLC Apartments 120,200 10 0.72%
Winpark One Two, LLC Industrial 133,250 8 0.62%
Lanel Financial Group Apartments 404,664 2 1.89%
Industrial Equities Group, LLC Office/Warehouse 114,250 9 0.53%
Core Mpls. Portfolio LLC Industrial 69,250 10 0.32%
$1,977,989 11.82%$2,003,965 9.35%
Total City of Crystal Tax Capacity $16,716,393 $21,401,890
*Tax Capacity is computed by applying class rate percentages, specific to each type of property classification, against Taxable Market Value.
Class rate percentages vary depending upon the type of property. The formulas and class rates for converting Taxable Market Value into Tax
Capacity represent a basic element of the Minnesota property tax system and are subject to annual revisions by the State.
Source: Hennepin County
1
2
6
City of Crystal
Principal Property Taxpayers
Current Year and Nine Years Ago
(unaudited)
2017 2008
6.2
City of Crystal
Property Tax Levies and Collections
Last Ten Fiscal Years
(unaudited)
Total Delinquent
Current Percentage Delinquent Total Collections Outstanding Taxes as
Fiscal Tax Tax of Levy Tax Tax as a % of Delinquent a % of
Year Levy Collections Collected Collections Collections Tax Levy Taxes Tax Levy
2008 7,612,282$ 7,448,064$ 97.84%164,218 $ 7,612,282$ 100.00%0 0.00%
2009 7,937,517 7,787,343 98.11%150,174 7,937,517 100.00%0 0.00%
2010 8,849,440 8,675,169 98.03%174,271 8,849,440 100.00%0 0.00%
2011 8,900,044 8,780,526 98.66%119,518 8,900,044 100.00%0 0.00%
2012 9,258,402 9,139,252 98.71%112,971 9,252,223 99.93%6,179 0.07%
2013 9,159,895 9,090,927 99.25%56,204 9,147,131 99.86%12,764 0.14%
2014 9,217,153 9,144,399 99.21%56,079 9,200,478 99.82%16,675 0.18%
2015 9,288,837 9,217,089 99.23%55,659 9,272,748 99.83%16,089 0.17%
2016 9,954,054 9,871,608 99.17%65,869 9,937,477 99.83%16,577 0.17%
2017 10,606,338 10,538,868 99.36%10,538,868 99.36%55,045 0.52%
Source: City of Crystal Finance Department records
1
2
7
Table 8
6.2
Table 9
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Taxable market value - amounts 1,873,116$ 1,794,668$ 1,658,174$ 1,491,193$ 1,292,737$ 1,136,761$ 1,135,611$ 1,293,694$ 1,339,237$ 1,482,067$
expressed in thousands
Debt limit (3% of taxable market value)56,193,000$ 53,840,000$ 49,745,000$ 44,736,000$ 38,782,000$ 34,103,000$ 34,068,000$ 38,811,000$ 40,177,000$ 44,462,000$
Less debt applicable to debt limit:
Total bonded debt 9,305,000 12,824,778 12,310,891 12,282,995 13,518,886 15,926,532 13,740,062 15,099,795 15,900,940 19,068,514
Deductions -
Tax increment bonds 665,000 260,000 - - - - - - - -
Special assessment bonds 6,675,000 9,525,000 8,915,000 9,880,000 11,770,000 14,191,612 12,559,803 14,083,544 15,050,000 19,068,514
7,340,000 9,785,000 8,915,000 9,880,000 11,770,000 14,191,612 12,559,803 14,083,544 15,050,000 19,068,514
Total debt applicable to debt limit 1,965,000 3,039,778 3,395,891 2,402,995 1,748,886 1,734,920 1,180,259 1,016,251 850,940 -
Legal debt margin 54,228,000$ 50,800,222$ 46,349,109$ 42,333,005$ 37,033,114$ 32,368,080$ 32,887,741$ 37,794,749$ 39,326,060$ 44,462,000$
Total debt applicable to the debt limit as
a percentage of the debt limit 3.5%5.6%6.8%5.4%4.5%5.1%3.5%2.6%2.1%0.0%
Source: City of Crystal Finance Department records
City of Crystal
Legal Debt Margin Information
Last Ten Fiscal Years
(unaudited)
1
2
8
6.2
City of Crystal
Last Ten Fiscal Years
(unaudited)
Business
Type
Activities
G.O.G.O.Percentage Percentage
Tax Special G.O.Total of Taxable of
Fiscal G.O.Increment Assessment Notes Primary Market Personal Per
Year Bonds Bonds Bonds Payable Government Value Income Capita
2008 1,965,000$ 665,000$ 6,675,000$ -$ -$ 9,305,000 0.50%0.73%420
2009 3,039,778 260,000 9,525,000 - - 12,824,778 0.71%1.10%583
2010 3,395,891 - 8,915,000 46,100 - 12,356,991 0.75%1.02%558
2011 2,402,995 - 9,880,000 46,100 - 12,329,095 0.83%0.97%556
2012 1,741,221 - 11,768,751 35,081 - 13,545,053 1.05%1.03%604
2013 1,734,920 - 14,191,612 - - 15,926,532 1.40%1.16%703
2014 1,180,259 - 12,559,803 - - 13,740,062 1.21%0.96%612
2015 1,016,251 - 14,083,544 - - 15,099,795 1.17%1.01%661
2016 850,940 - 15,281,867 - - 16,132,807 1.09%1.05%706
2017 - - 19,068,514 - - 19,068,514 1.17%1.24%834
Sources: Outstanding Debt - City of Crystal Finance Department Records
Taxable Market Value - Hennepin County Assessor Department
Personal income - U.S. Department of Commerce, Bureau of Economic Analysis
Population - U.S. Census Bureau for census years and estimates by Metropolitan Council for non-census years
1
2
9
Table 10
Legal Debt Margin Information
Governmental
Activities
6.2
Table 11
City of Crystal
Last Ten Fiscal Years
(unaudited)
Less Percentage
Amount of Taxable
Restricted Market
Fiscal G.O.for Debt Value of Per
Year Bonds Service Total Property Capita
2008 1,965,000$ 265,576$ 1,699,424$ 0.09%76.66
2009 3,039,778 272,006 2,767,772 0.15%125.73
2010 3,395,891 272,312 3,123,579 0.19%141.01
2011 2,402,995 282,456 2,120,539 0.14%95.66
2012 1,741,221 291,284 1,449,937 0.11%64.68
2013 1,734,920 294,217 1,440,703 0.13%63.62
2014 1,180,259 455,740 724,519 0.06%32.29
2015 1,016,251 456,775 559,476 0.04%24.48
2016 850,940 298,069 552,871 0.04%24.19
2017 - 298,069 (298,069)-0.02%-13.04
Note: Details regarding the city's outstanding debt can be found in the notes to the financial statements.
Sources: The amount of G.O. bonds is from Table 9 - Legal Debt Margin Information
The amount Restricted for Debt Service is the sum of fund balances for applicable issues
Property value data is from Table 5 - Taxable and Estimated Market Values Of Taxable Property
Population data is from Table 13 - Demographic and Economic Statistics
Legal Debt Margin Information
1
3
0
6.2
City of Crystal
Legal Debt Margin Information
As Of December 31, 2017
(unaudited)
Net General
Obligation Percentage Amount
Bonded Debt Applicable To Applicable To
Jurisdiction Outstanding Government *Government
Direct -
City of Crystal 19,068,514$ 100.00%19,068,514$
Overlapping -
Robbinsdale ISD #281 217,763,960 20.43%44,489,177
Hennepin County 1,110,220,000 1.02%11,324,244
Hennepin Suburban Park District 68,265,000 1.42%969,363
Hennepin Regional RR Authority 31,535,000 1.42%447,797
Metropolitan Council / Transit 1,484,038,432 0.52%7,717,000
2,911,822,392 64,947,581
Total 2,930,890,906$ 84,016,095$
*Overlapping governments are those that coincide, at least in part, with the geographic boundaries
of the City of Crystal. This schedule estimates the portion of the outstanding debt of those
overlapping governments that is borne by the residents and businesses of the City of Crystal.
This process recognizes that, when considering the City of Crystal's ability to issue and repay
long-term debt, the entire debt burden borne by the residents and businesses should be taken
into account.
The percentage of overlapping debt is estimated using tax capacity. Applicable percentages
were estimated by determining the portion of each overlapping government's tax capacity within
the City of Crystal's boundaries and dividing it by that government's total tax capacity.
Source: City of Crystal Finance Department records and Hennepin County
1
3
1
Table 12
6.2
Per Capita Total City District-Wide
Fiscal Personal Personal School Unemployment
Year Population Income Income Enrollment Rate
2008 22,167 57,693$ 1,278,880,731$ 12,106 6.7%
2009 22,014 52,999 1,166,719,986 11,644 10.4%
2010 22,151 54,949 1,217,175,299 11,662 9.3%
2011 22,168 57,476 1,274,127,968 11,734 8.2%
2012 22,417 58,898 1,320,316,466 11,720 5.9%
2013 22,645 60,601 1,372,309,645 11,827 5.2%
2014 22,436 63,901 1,433,682,836 11,821 4.3%
2015 22,852 65,231 1,490,658,812 12,690 3.7%
2016 22,855 67,427 1,541,044,085 12,630 3.7%
2017 22,855 67,427 1,541,044,085 12,011 3.4%
Sources:
Population - U.S. Census Bureau for census years and estimates by Metropolitan Council for non-census years.
The current year is reported same as the prior year due to data not yet being available at the time this report
was prepared.
Per capita personal income - U.S. Department of Commerce, Bureau of Economic Analysis. The per capita
personal income used is that for Hennepin County, MN, in which the City resides. It is the smallest
region applicable to the City that this information is available for. The current year is reported same as
the prior year due to data not yet being available at the time this report was prepared.
Total City personal income - These estimated amounts are derived by multiplying the per capita personal
income amount by the City's population for each applicable year.
District-wide school enrollment - Counts are provided by Robbinsdale ISD #281 as of December 31 of each
year. ISD #281 serves households in all or parts of Crystal, Brooklyn Center, Brooklyn Park, Golden
Valley, New Hope, Plymouth and Robbinsdale.
Unemployment rate - Minnesota Department of Employment and Economic Development. Rates are an
adjusted yearly average.
1
3
2
Table 13
City of Crystal
Demographic and Economic Statistics
Last Ten Fiscal Years
(unaudited)
6.2
Percentage Percentage
of Total of Total
Number of City Number of City
Employer Employees Rank Employment Employees Rank Employment
Volunteers of America -
Crystal Care Center 200 1 4.74%175 3 3.96%
Target 185 2 4.38%200 1 4.53%
Cub Foods 150 3 3.55%180 2 4.08%
City of Crystal 100 4 2.37%101 4 2.29%
RFG Distributing 98 5 2.32%
Kilmer Electric Co., Inc.73 6 1.73%
Buffalo Wild Wings 70 7 1.66%
Almsted's Crystal Super Value 60 8 1.42%70 5 1.59%
McDonald's 60 9 1.42%
Minnesota Grinding 40 10 0.95%
Thrift-Way Supermarket 60 6 1.36%
Featherlite Exhibits 50 7 1.13%
Qwest (now CenturyLink)*8 0.00%
Wells Fargo Bank, N.A.*9 0.00%
Unknown **10 0.00%
1,036 24.54%836 18.94%
Estimated Total Employment 4,221 4,416
*Qwest and Wells Fargo Bank are large employers within the City of Crystal but no longer give out local
employment numbers.
**Data is NOT available from the Minnesota Department of Employment and Economic Development, as such data is
classified as private. No source of data for this table was available that included rankings down to 10.
Sources:Principal employers are a result of telephone surveys of employers by Springsted, Inc., in conjunction
with city bond sales.
Estimated Total Employment is per the Minnesota Department of Employment and Economic
Development web site.
Table 14
1
3
3
City of Crystal
Prinicpal Employers
Current Year and Nine Years Ago
(unaudited)
2017 2008
6.2
Function 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
General Government 12 12 11 11 11 11 11 11 11 9
Public Safety
Police
Officers 29 29 28 30 30 28 27 30 30 33
Civilians 8 7 6 8 6 6 5 4 4 5
Public Works
Engineering 3 3 3 3 3 3 3 3 3 3
Maintenance 9 9 8 7 8 8 8 8 8 8
Parks and Recreation
Park maintenance 6 6 6 6 6 6 6 6 6 6
Recreation 5 5 5 5 5 5 5 5 6 5
Community Development 7 7 7 7 6 6 7 7 6 7
Utilities
Water / Sanitary Sewer / Storm Drainage 8 8 9 9 8 9 9 9 10 10
87 86 83 86 83 82 81 83 84 86
Source: City of Crystal Finance Department records
Table 15
1
3
4
City of Crystal
Full-Time City Government Employees By Function
Last Ten Fiscal Years
(unaudited)
6.2
Table 16
Function 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
General Government
Administration
Employee recruitments 13 15 11 16 19 19 22 26 17 20
Licenses issued 1,018 976 1,069 1,057 1,159 1,262 1,333 1,294 1,323 954
Public Safety
Police
Calls for service 29,395 30,007 30,681 32,464 31,878 31,624 34,362 31,077 30,860 27,296
Citations issued 4,651 5,548 5,369 6,199 6,133 6,622 6,230 5,798 5,771 4,710
Criminal cases investigated 1,848 1,490 1,426 1,261 1,771 1,123 1,172 1,208 1,372 1,362
Total arrests 1,158 1,265 1,081 1,184 1,226 925 767 859 926 826
Animal control incidents 783 709 334 501 471 469 447 457 509 391
Dog licenses issued 455 350 344 315 287 219 258 298 278 223
Fire (West Metro Fire-Rescue District)
Calls for service 977 1,346 1,451 1,641 1,349 1,448 1,663 1,514 1,573 1,922
Inspections, plan reviews and
consultations 792 768 796 899 734 747 808 824 746 860
Public Works
Miles of streets sealcoated 0 4 5 12 6 5 ***0
Miles of streets reconstructed 5 7 0 4 6 6 0 5 5 5
Phase of 16-phase street project Phase 9 Phase 10 Phase 11 Phase 12 Phase 13 Phase 14 Phase 15 Phase 16
Parks and Recreation
Recreation program participants 8,377 8,375 8,459 9,301 9,132 10,600 13,847 12,149 11,082 11,623
No. of teams in team sports 129 155 172 195 221 212 212 216 249 228
No. of participants in special events 2,548 3,822 4,040 4,647 4,142 3,897 5,425 4,542 5,382 4,690
No. of rental groups 166 162 228 208 185 229 218 201 ****
No. of facility rentals ****************711 1,022
Community Center permits 768 672 659 600 657 684 680 671 862 957
Pool attendance 43,658 33,413 35,681 33,220 31,127 30,009 28,042 28,092 26,769 27,098
Community Development
Permit inspections 3,230 3,065 2,664 2,331 2,350 2,868 2,779 2,771 2,430 2,835
Code enforcement incidents 1,301 1,604 1,434 1,378 1,319 1,332 1,482 1,539 1,514 1,405
Rental housing - no. of licensed units 2,394 2,343 2,431 2,457 2,575 2,788 2,859 2,548 2,915 2,831
Point of sale inspections/re-inspections 664 726 416 424 385 468 442 404 13 13 ***
Planning Commission applications 18 19 8 18 8 16 12 6 12 11
Utilities
Water system
Average residential consumption
(million gallons / day)1.26 Mg/d 1.53 Mg/d 1.45 Mg/d 1.33 Mg/d 1.46 Mg/d 1.34 Mg/d 1.26 Mg/d 1.22 Mg/d 1.20 Mg/d 1.60 Mg/d
*The sealcoat program was phased out after 2013. Mill and overlay will be used going forward.
**Effective 2016, it was determined that number of facility rentals was a better measure of reporting than number of rental groups. Only that indicator will be presented on a prospective basis.
***The point of sale program was phased out in 2015-2016.
Source: Various city departments
Operating Indicators By Function
Last Ten Fiscal Years
City of Crystal
(unaudited)
1
3
5
6.2
Function 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Public Safety
Police
Number of stations 1 1 1 1 1 1 1 1 1 1
Public Works
Street maintenance
Miles of city street 92 92 92 92 91 91 91 91 90 90
Parks and Recreation
Recreation
Number of park acres 243 243 243 244 253 253 253 253 263 263
Number of parks 28 28 28 28 28 28 28 28 27 27
Number of parks with playground apparatus 19 19 19 20 20 20 20 20 19 19
Number of tennis courts 13 13 13 13 12 12 12 12 7 7
Number of supervised ice skating rinks
Hockey 4 4 4 4 4 4 4 4 4 3
General use 3 3 3 3 3 3 3 3 3 2
Number of baseball fields
General use 2 2 2 2 2 2 2 2 2 2
Grogan Park (Little League) Fields 3 3 3 3 3 3 3 3 3 3
Number of softball fields
Reservable 7 7 7 7 7 7 7 7 7 7
Non-reservable (neighborhood park backstop)16 16 16 16 16 15 15 10 7 7
Number of full-size soccer fields 1 1 1 2 2 2 2 2 2 2
Number of skateboard parks 1 1 1 1 1 1 1 1 1 1
Community Center
Number of centers 1 1 1 1 1 1 1 1 1 1
Waterslide / swimming pool
Number of facilities 1 1 1 1 1 1 1 1 1 1
Utilities
Water system
Miles of water main (owned by city)90 90 90 90 90 90 90 90 90 93
Number of service connections 7,868 7,864 7,885 7,888 7,803 7,812 7,817 7,830 7,841 7,841
Number of fire hydrants 808 808 809 819 820 821 821 823 823 797
Sewer system
Miles of sanitary sewer 87 87 87 87 87 87 87 87 87 87
Number of service connections 7,913 7,912 7,910 7,911 7,821 7,827 7,837 7,845 7,855 7,855
Number of lift stations 7 7 7 7 7 7 7 7 7 7
Storm drainage system
Miles of storm sewer 58 60 64 64 66 74 76 76 77 65
Number of lift stations 1 1 1 1 1 1 1 1 1 1
Note: No capital asset indicators are available for the general government and community development functions.
Source: Various city departments1
3
6
Table 17
City of Crystal
Capital Asset Statistics By Function
Last Ten Fiscal Years
(unaudited)
6.2
CCCRRRYYYSSSTTTAAALLL PPPOOOLLLIIICCCEEE DDDEEEPPPAAARRRTTTMMMEEENNNTTT
“Service with Compassion, Integrity, & Professionalism”
TO: Mayor and Council Members
FROM: Stephanie K. Revering, Chief of Police
CC: Anne Norris, City Manager
DATE: May 10, 2018
SUBJECT: POLICE EQUIPMENT REVOLVING FUND
___________________________________________________________________________
MMEEMMOORRAANNDDUUMM
During the 2018 budget discussions, the Council was informed of the need to purchase a piece
of equipment, a Firearms Training Simulator (FATS) that provides additional police training.
The Firearms Training Simulator (FATS) is a scenario-based tool for law enforcement that
promotes critical decision making during situations officers may encounter on a regular basis.
The Firearms Training Simulator (FATS) will also be used for community awareness,
training, and transparency. The community will be able to utilize the Firearms Training
Simulator (FATS) at events such as the Citizens’ Police Academy, etc.
We are asking for approval of the attached resolution which has been placed on the regular
agenda of the May 15, 2018 council meeting.
As always, please let me know if you have any questions. Thanks.
6.3
6.3
6.3
6.3
RESOLUTION NO. 2018 -
RESOLUTION AUTHORIZING PURCHASE OF A FIREARMS TRAINING SYSTEM
(FATS)
WHEREAS, the City Manager’s office has received and recommends approval of said
appropriations, and
WHEREAS, the appropriation is included in the 2018 Police Equipment
Revolving Fund Budget, and
WHEREAS, the City Council hereby acknowledges:
1. The Firearms Training System produces an interactive firearms training
simulator with reality-based scenarios for law enforcement and community
policing purposes.
2. The most suitable source of funding is the Police Equipment Revolving
Fund.
NOW, THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF
THE CITY OF CRYSTAL, hereby accepts and appropriates monies from the Police
Equipment Revolving Fund for the purchase of a Firearms Training System (FATS) at
$45,000. The cost includes purchase of the Firearms Training Simulator (FATS) as well
as necessary installation of equipment, not to exceed $45,000.
Adopted by the Crystal City Council this 15th day of May, 2018.
__________________________
Jim Adams, Mayor
ATTEST:
_________________________
Chrissy Serres, City Clerk
6.3
4141 Douglas Drive North • Crystal, Minnesota 55422-1696
Tel: (763) 531-1000 • Fax: (763) 531-1188 • www.crystalmn.gov
Memorandum
DATE: May 10, 2018
TO: Mayor and City Council
Anne Norris, City Manager
FROM: John Elholm, Recreation Director
SUBJECT: Award of Construction Contract for Welcome Park Phase 1
PROJECT
This project involves construction of a new softball field in Welcome Park that includes irrigation,
fencing, lighting and other related amenities. There is $660,000 allocated in the parks capital
fund for this project.
RECAP
12/19/17 Council adopted the city’s park and recreation system plan that included concept
plans for Welcome Park.
1/02/2018 Council authorized a contract with design consultant WSB & Associates to
complete final design work for a portion of Welcome Park.
2/27/2018 Staff and WSB & Associates held an open house at the Crystal Community
Center to discuss the project with residents.
4/12/2018 Final design completed
4/17/2018 Authorization to solicit bids granted
5/10/2018 Bid opening occurred at Crystal City Hall
6.4
BID RESULTS
Contractor Total Base Bid Grand Total Bid
Rachel Contracting Inc. $417,327.50 $477,303.50
Peterson Companies Inc. $437,477.31 $488,291.76
Derau Construction $473,152.30 $538,331.05
New Look Contracting $497,894.00 $574,961.00
G Urban Companies $575,742.00 $659,212.00
SOFTBALL FIELD BUDGET
Budgeted Amount $ 660,000
Construction Contract with Low Bidder (Rachel Contracting) $ 417,328
Add 5% Contingency $ 20,866
City Purchase Softball Light Poles & Fixtures $ 171,028
City Utilities Provide Project Stormwater Improvements $ 13,000
Existing Consultant Contract with WSB $ 56,242
Total Cost to Build a Softball Field at Welcome Park $ 678,464
Difference Short $ 18,464
Recommend Using a Portion of Other PIR Projects to Complete Project
PIR #5415 (pool floor) $ 16,464
PIR #5001 (park signs) $ 2,000
Add $ 18,464
Remaining Balance of PIR #5415 $ 433
Remaining Balance of PIR #5001 $ 8,000
HOCKEY RINK
The budget for this project did not have room to add new hockey rink lights or boards. Senior Staff
is developing a plan to fund the hockey rink improvements; which will be presented to the city
council on June 5th.
REQUESTED COUNCIL ACTION
Approval of a resolution to enter into a contract with Rachel Contracting for Phase 1 Improvements
at Welcome Park (softball fields).
6.4
CITY OF CRYSTAL
RESOLUTION 2018 -
AWARD CONTRACT
FOR PHASE 1 IMPROVEMENTS
AT WELCOME PARK
WHEREAS, the Crystal City Council authorized solicitation of public bids for Phase 1 Improvements at
Welcome Park, and
WHEREAS, Five bids were received and publicly opened on May 10, 2018, and
WHEREAS, Rachel Contracting submitted the low bid and has successfully constructed similar projects
in other cities;
NOW, THEREFORE, BE IT RESOLVED:
A. That the Crystal City Council hereby awards the contract for Phase 1 Improvements at Welcome
Park (Project 2018-09) to Rachel Contracting, Inc. in the amount of $ 417,327.50.
B. That the Crystal City Council hereby authorizes the Mayor and City Manager to sign such
contract.
Adopted by the Crystal City Council this 15th day of May, 2018.
________________________
Jim Adams, Mayor
ATTEST:
___________________________
Christina Serres, City Clerk
6.4
4141 Douglas Drive North • Crystal, Minnesota 55422-1696
Tel: (763) 531-1000 • Fax: (763) 531-1188 • www.crystalmn.gov
Memorandum
DATE: May 10, 2018
TO: Mayor and City Council
Anne Norris, City Manager
FROM: John Elholm, Recreation Director
SUBJECT: Crystal Community Center LED Message Board
The Crystal Community Center currently has a large monument sign in front of the building with
the City’s old logo and the words, “Crystal Community Center”. There is a 2nd large sign along
Douglas Drive that consists primarily of a two sided LED message board. In the past year one
side of the message board has stopped working. The message board is beyond its expected
life, so repair has proven difficult.
A new message board is included in the 2018 capital budget in the amount of $40,000. The
project proposed here includes combining the monument sign and the two sided LED message
board into one. The new structure will be located where the current monument sign is, and will
include a new City of Crystal logo and color LED message board on each side. Quotes have
been received, and the lowest quote is with Think Digital Signs to install a Watchfire Marquee
and structure in the amount of $34,810. The second quote received is for $69,831. There will
be an additional cost for related electrical work.
Staff recommends entering into an agreement with Think Digital Signs in the amount of $34,810
to provide and install color LED marquees and sign structure at the Crystal Community Center.
6.5
CITY OF CRYSTAL
RESOLUTION 2018 -
RESOLUTION IN SUPPORT OF REPLACING THE LED MESSAGE BOARD AT THE
CRYSTAL COMMUNITY CENTER
WHEREAS, the City of Crystal owns and operates the Crystal Community Center, and
WHEREAS, the LED message board in front of the building has fallen into disrepair, and
WHEREAS, it is desirable to be able to highlight information on upcoming community happenings to
people passing the building, and
WHEREAS, $40,000 is included in the 2018 PIR to replace the message board, and
WHEREAS, the monument sign in front of the building displays the old City of Crystal Logo, and
WHEREAS, quotes were requested and received from two vendors to provide one sign structure that
contains both a monument sign with new logo and LED message boards;
THEREFORE, BE IT RESOLVED:
A. That the Crystal City Council wishes to enter into an agreement with Think Digital Signs, the
company with the lowest quote, in the amount of $34,810 to furnish and install color LED
marquees and sign structure at the Crystal Community Center.
B. That the Crystal City Council hereby authorizes the City Manager to sign the agreement with
Think Digital Signs to complete the work.
Adopted by the Crystal City Council this 15th day of May, 2018.
________________________
Jim Adams, Mayor
ATTEST:
___________________________
Christina Serres, City Clerk
6.5
May 15, 2018
6.5
The LED message boards at the Crystal Community Center
are beyond their useful life and can’t be repaired.
The monument sign near the driveway is original to the
building and has old lighting and the old City logo
This project will replace the two signs with one sign
Will contain the new City logo and background color
Will contain a new LED message board on each side
Will be located near the main Community Center driveway
6.5
$40,000 is included in the 2018 PIR Budget to purchase
and install new LED message boards
Quotes were received from two companies
•Think Digital Signs had the lowest quote at $34,810
•2nd Quote was for over $69,000
6.5
6.5
• To approve an agreement with Think Digital
Signs, in the amount of $34,810, to furnish and
install color LED marquees and sign structure at
the Crystal Community Center.
6.5
6.5
Memorandum
DATE: May 15, 2018
TO: City Council
FROM: Mark Ray, PE, Director of Public Works
SUBJECT: Forestry services contract
Background
While the City does provide some forestry services in-house, for larger projects, specialized
projects, or in response to a major storm event the City has a contract with a forestry company.
The proposed contract will last until December 31, 2019 and may be extended by one year
increments up to two additional years.
In order to compare bids, estimated quantities were needed as part of the bid package. That
said, because the services are on an as-needed basis, staff is aware of the budget ($50,000 in
2018) and keeps the work scope in line with funding. The one exception to this being if there
was a major storm, the City would take whatever immediate actions needed to protect life and
establish emergency access on all City streets.
Quotes
Nick’s Tree Service $86,584.00
Sunrise Painting and Wallcovering, Inc. $97,744.50
Contractor experience
Nick’s Tree Service has been the City’s forestry contractor for many years and staff are
comfortable with the contractor’s ability to continue to meet the City’s forestry needs.
Attachments
•Forestry contract
•Bid prices
Recommended Action
Motion to approve the resolution awarding the contract for forestry services to Nick’s Tree
Service.
6.6
1
516322v4 KRH CR225-431
CITY OF CRYSTAL
MINNESOTA
FORESTRY SERVICES CONTRACT
This Forestry Services Contract (“Contract”) is made and entered into this 15th day of
May, 2018, by and between the City of Crystal, a Minnesota municipal corporation, 4141
Douglas Drive North, Crystal, MN 55422 (“City”) and Nick’s Tree Service a
________________ _______________ (“Contractor”). The City and the Contractor may
hereinafter be referred to individually as a “party” or collectively as the “parties.”
RECITALS
A. The City desires to hire a contractor to provide all equipment, materials, and personnel as
may be needed to provide the Forestry services described in the attached Exhibit A
(collectively, the “Services”);
B. The total estimated amount of the Services is over $100,000 and so the City is entering this
agreement after obtaining competitive bids and granting the contract to the lowest
responsible bidder; and
C. The City has selected the Contractor to provide the Services and the Contractor is agreeable
to providing the Services in accordance with the terms and conditions as set out herein.
CONTRACT
In consideration of the mutual promises and Contracts contained herein, and intending to
be legally bound, the City and the Contractor hereby agree as follows:
1. Term. This Contract shall commence as of the date first written above and shall terminate
on December 31, 2019. The contract may be extended in one year increments up to an
additional two years.
2. Services Timing. The Contractor shall provide the Services in accordance with the
schedules and deadlines set out in the attached Exhibit A.
3. Contract Documents. The following, together with this Forestry Services Contract
document, constitute the contract documents for the Services and are incorporated in and
made part of the Contract:
(a) Description and Specifications (attached as Exhibit A); and
(b) Contractor’s Bid Response (attached as Exhibit B).
(c) Advertisement for Bids (attached as Exhibit C).
(d) Instructions to Bidders (attached as Exhibit D).
(e) Responsible Contractor Statement (attached as Exhibit E).
(f) Non-Discrimination Affidavit (attached as Exhibit F).
6.6
2
516322v4 KRH CR225-431
(g) Affidavit of non-collusion (attached as Exhibit G)
(h) Performance Bond (attached as Exhibit H).
(i) Certificate of Insurance (attached as Exhibit I).
4. Scope of Services. The Contractor agrees to provide, as requested by the City, all
equipment, materials, and personnel as needed to complete the Services in accordance with
the description and specifications attached hereto as Exhibit A. The Contractor shall
perform the Services in a workmanlike manner, in a timely and competent fashion, and will
take all steps necessary to protect personal property and the public from injury arising from
the Contractor’s performance of the Services under this Contract.
5. Contract Price. The City agrees to pay the Contractor for the satisfactory performance of
the Services based upon the rates set out in the attached Exhibit B. The indicated rates are
all-inclusive amounts to provide the Services and the City is not required to pay the
Contractor any expenses, surcharges, fees, or other additional amounts related to the
provisions of the Services.
6. Claims for Payment. The Contractor must submit detailed written claims for payment in
order to be eligible to receive payment from the City. The claims shall be sufficiently
detailed and endorsed to substantiate the requests for payment and comply with the
requirements of Minnesota Statutes, section 471.38.
7. Independent Contractor. The Contractor agrees it is an independent contractor for all
purposes and nothing herein shall be construed as creating an employment relationship.
The City will not provide the Contractor with any training with respect to the skills needed
to perform the Services required by this Contract. The Contractor acknowledges that any
general instruction that it may receive from the City will have no effect on its status as an
independent contractor. The Contractor is not eligible to receive workers’ compensation,
unemployment insurance, employee pension, health insurance, vacation or sick pay or any
other benefit or compensation from the City. The Contractor is responsible for
withholding, reporting and paying any taxes on the payments that it receives from the City.
Upon demand, the Contractor shall provide the City with proof that such payments have
been made. This Contract does not create a partnership relationship or joint venture
between the City and the Contractor. The Contractor does not have the authority to enter
into contracts on the City’s behalf.
8. Insurance Requirements. The Contractor agrees that it will provide and maintain at all
times during the term of this Contract such insurance coverages as are indicated herein and
that will otherwise comply with the provisions that follow. Such policy or policies shall
apply to the extent of, but not as a limitation upon or in satisfaction of, the indemnity
provisions of this Contract. The provisions of this section shall also apply to all
subcontractors, other lower tier contractors, and independent contractors engaged by the
Contractor with respect to this Contract, and the Contractor shall be entirely responsible of
securing the compliance of all such persons or parties with these provisions. All policies
required by this Contract shall be issued by financially responsible insurers licensed to do
business in the State of Minnesota. The Contractor shall not commence or perform any of
6.6
3
516322v4 KRH CR225-431
the Services under this Contract until certificates of insurance are presented to the City
showing the required coverages are in full force and effect with at least the required
coverage limit amounts.
(a) Workers’ Compensation:
(1) State: Statutory Amounts
(2) Applicable Federal: Statutory Amounts
(3) Employer’s Liability:
i. Bodily Injury by Accident $100,000 Each Accident
ii. Bodily Injury by Disease $100,000 Each Accident
iii. Bodily Injury by Disease $500,000 Policy Limit
(b) Commercial General Liability:
(1) General Aggregate $1,000,000
(2) Each Occurrence(Bodily Injury/Property Damage) $500,000
(3) Excess or Umbrella Liability
i. General Aggregate $2,000,000
ii. Each Occurrence $2,000,000
(c) Automobile Liability:
(1) Bodily Injury:
i. Each Person $1,000,000
ii. Each Accident $1,000,000
(2) Property Damage:
i. Each Accident $1,000,000
ii. Each Accident $1,000,000
(3) Combined Single Limit: $1,000,000
9. Indemnification. Any and all claims that arise or may arise against the Contractor, it
agents, servants, or employees as a consequence of any act or omission on the part of the
contractor or its agents, servants, or employees while engaged in the performance of the
Contract shall in no way be the obligation or responsibility of the City. The Contractor
shall indemnify, hold harmless, and defend the City, its officers, agents, and employees
against any and all liability, loss, costs, damages, expenses, claims or actions, including
attorney fees which the City, its officers, agents, or employees may hereafter sustain, incur,
or be required to pay, arising out of or by reason of any act or omission of the Contractor,
its agents, servants or employee, in the execution, performance, or failure to adequately
perform the Contractor’s obligations pursuant to this Contract.
10. Liability Limitations. Nothing in this Contract shall constitute or be construed as a waiver
by the City of any limitation on or immunities from liability available to the City under
Minnesota Statutes, Chapter 466 or other law.
11. Termination. Either party may terminate this Contract, with or without cause, upon 30
days’ written notice to the other party. Without limitation of the foregoing, the City may
immediately terminate this Contract or may pursue any other available remedies at law or
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in equity that are necessary or desirable to enforce performance and observance of any
obligation, agreement, or covenant of this Contract if it determines any of the following
have occurred: failure to adequately perform or deliver the required services; failure to
following the specifications or standards established by this Contract; failure to perform or
complete the services in a timely fashion as established by the City; or failure to correct
deficiencies within ten (10) days. If the City terminates this Contract for the Contractor’s
failure to perform, it shall provide the Contractor written notice that includes the reasons
for the Termination.
12. Preservation of Other Remedies. The rights and remedies of the City provided in this
Contract shall not be exclusive and are in addition to any other rights and remedies
provided by law or under this Contract.
13. Subcontracting and Assignment. The Contractor shall not subcontract or assign any
portion of this Contract without prior written permission of the City.
14. Required Submittals. The Contractor agrees to provide the City all of the following
before commencing any of the Services:
a) List of all proposed subcontractors
b) Responsible Contractor Statement (attached as Exhibit E)
c) Non-Discrimination Affidavit (attached as Exhibit F)
d) Affidavit of non-collusion (attached as Exhibit G)
e) Performance Bond (attached as Exhibit H)
f) Certificate of Insurance showing the types and amounts of insurance required by this
Contract and naming the City as an additional insured on the Contractor’s commercial
general liability policy (attached as Exhibit I)
15. Notices. Any notices provided under this Contract shall be delivered or mailed to the
following:
(a) To the City at: Mark Ray
City Engineer
City of Crystal
4141 Douglas Drive North
Crystal, MN 55422
(b) To the Contractor at: Nick Arrigo
9000 Foxline Drive
Corcoran, MN 55340
16. Legal Compliance. The Contractor is required to comply with all applicable federal, state,
and local laws, rules, regulations, and ordinances in the performance of the Services and
shall obtain any licenses, permits, or permissions that may be required to undertake and
complete the Services.
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17. Nondiscrimination. Contractor agrees to comply with the provisions of all applicable
federal, state, and local laws, rules, regulations, and ordinances pertaining to civil rights
and nondiscrimination including, without limitation, Minnesota Statutes, section 181.59.
Failure to comply with this requirement, as reasonably determined by the City, may result
in the termination of this Contract.
18. Conflict of Interest. Contractor agrees that it will not, during the term of this Contract,
enter into a contract or otherwise accept employment for the performance of any work or
service with any individual, business, partnership, corporation, government, governmental
unit, or any other organization that would create a conflict of interest in the performance of
its obligations under this Contract.
19. Entire Contract. This writing represents the entire Contract and understanding of the
parties with respect to the subject matter hereof and supersedes any and all previous
Contracts of whatever nature between the parties with respect to the subject matter. This
Contract may not be altered or amended except by an agreement in writing signed by the
parties. Without limitation of the foregoing, no claim for extra work done or materials
furnished by the Contractor will be made by the Contractor or allowed by the City, nor
shall the Contractor do any work or furnish any materials not covered by this Contract,
unless such work or materials is ordered in writing by the City.
20. City Obligation. All covenants, promises, Contracts, and obligations of the City contained
herein shall be deemed to be the covenants, stipulations, promises, agreements, and
obligations of the City, and not of any governing body member, officer, agent, servant, or
employee of the City in the individual capacity thereof.
21. Non-Exclusivity. This Contract is not exclusive between the City and the Contractor. The
City, in its sole discretion and without limitation, may retain additional contractors or
subcontractors to perform any or all of the Services to be provided under this Contract.
Such services shall be provided independently from this Contract and under such terms and
conditions as the City and the other contractors or subcontractors may agree to. Nothing in
this Contract shall be construed as limiting the City’s right to retain the services of other
contractors.
22. Prompt Payment of Subcontractors. If subcontractors are authorized to be used in the
delivery of the Services, the Contractor shall, in accordance with Minnesota Statutes,
section 471.425, subdivision 4a, pay the subcontractors for undisputed services provided by
them within 10 days of receiving payment from the City. The Contractor shall pay interest
of 1-1/2 percent per month or any part of a month to a subcontractor on any undisputed
amount not paid on time to the subcontractor. The minimum monthly interest penalty
payment for an unpaid balance of $100 or more is $10. For an unpaid balance of less than
$100, the Contractor shall pay the actual penalty due to the subcontractor.
23. Equal Negotiation. The parties acknowledge that they participated equally in the
negotiation and drafting of this Contract and that, accordingly, no court shall construe this
Contract more stringently against one party than the other.
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24. No Waiver. The waiver by any party of a breach or violation of, or failure of any party to
enforce, any provision of this Contract shall not operate or be construed as a waiver of any
subsequent breach or violation or as a relinquishment of any rights hereunder.
25. Applicable Law. This Contract has been made, and its validity, performance, and effect
shall be determined in accordance with the internal laws of the State of Minnesota without
regard to conflict of law provisions. Any dispute arising out of this Contract shall be heard
in the state or federal courts in Hennepin County, Minnesota and the parties hereto waive
any objection of such courts, jurisdictional or otherwise, and whether based on convenience
or any other grounds.
26. Audit. In accordance with Minnesota Statutes, Section 16C.05, subdivision 5, the
Contractor’s books, records, documents and accounting procedures and practices relevant
to this Contract are subject to examination by the City and the Minnesota State Auditor or
Minnesota Legislative Auditor for a minimum of six years from the expiration date of this
Contract.
27. Data Practices. Pursuant to Minnesota Statutes, section 13.05, Subd. 11, all of the data
created, collected, received, stored, used, maintained, or disseminated by the Contractor in
performing the Services is subject to the requirements of the Minnesota Government Data
Practices Act, Minnesota Statutes Chapter 13, (“Act”) and the Contractor must comply
with those requirements as if it were a government entity. The remedies in Minnesota
Statutes, section 13.08 apply to the Contractor. The Contractor does not have a duty to
provide access to public data to the public if the public data are available from the City.
The Contractor shall immediately notify the City if it receives a request under the Act and
shall work with the City to ensure the response complies with the Act.
28. Recitals and Exhibits Incorporated. The recitals contained herein and the exhibits
attached hereto are incorporated in and made part of this Contract.
29. Controlling Provisions. The provisions of the documents constituting the Contract shall
be read together and reconciled to the greatest extent reasonably possible. To the extent
there are any conflicting provisions that cannot be reconciled, the more specific provision
shall generally be controlling. To the extent the conflicting provision is contained in the
Contractor’s proposal (Exhibit B), the provisions contained in this document shall be
controlling.
30. Authority. Each of the undersigned parties warrants that it has the full authority to execute
this Contract, and each individual signing this Contract on behalf of a corporation hereby
warrants that he or she has full authority to sign on behalf of the corporation and that he or
she represents and binds such corporation thereby.
31. Severability. If any part of this Contract is invalid or unenforceable under applicable law,
that part shall be ineffective only to the extent of such invalidity or unenforceability
without in any way affecting the remaining parts of the provision or this Contract.
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IN WITNESS WHEREOF, the parties have executed this Contract as of the date and year
first written above.
CONTRACTOR
By: Nick Arrigo
Print Name
Its: President
Title
Signature
Date:
CITY OF CRYSTAL
By:
Its Mayor
Signature
By:
Its Manager
Signature
Date:
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EXHIBIT A
Description and Specifications
[attached hereto]
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EXHIBIT B
Contractor’s Bid Response
[attached hereto]
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EXHIBIT C
Advertisement of Bids
[attached hereto]
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EXHIBIT D
Instructions to Bidders
[attached hereto]
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EXHIBIT E
Responsible Contractor Statement
[attached hereto]
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EXHIBIT F
Non-discrimination Affidavit
[attached hereto]
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EXHIBIT G
Affidavit of Non-collusion
[attached hereto]
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EXHIBIT H
Performance Bond
[attached hereto]
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EXHIBIT I
Certificate of Insurance
[attached hereto]
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RESOLUTION NO. 2018- _____
AWARDING THE CONTRACT FOR FORESTRY SERVICES
WHEREAS, the Crystal City Council is committed to providing and maintaining quality
infrastructure that is essential for everyday residential, commercial, industrial, and recreational activities
in the City; and
WHEREAS, the City does not have the equipment or personnel to provide all the needed forestry
services in-house; and
WHEREAS, the City has consistently used a contractor to provide such services; and
WHEREAS, a public bidding process was completed for the forestry services contract;
NOW, THEREFORE, BE IT RESOLVED that the Crystal City Council hereby approves the
contract with Nick’s Tree Services for forestry services through December 31, 2019.
BE IT FURTHER RESOLVED that the Mayor and City Manager are authorized to sign said
contract.
Adopted by the Crystal City Council this 15th day of May 2018.
Jim Adams, Mayor
ATTEST:
Christina Serres, City Clerk
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