7/5/17 Shakopee City Council Meeting Agenda
7/5/17 Shakopee City Council Meeting Agenda
7/5/17 Shakopee City Council Meeting Agenda
July 5, 2017
7:00 PM
City Hall 129 Holmes St.
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*4. D.5. *Gambling Premise Permit for Shako Valley Amateur Hockey Association
E. Planning and Development
*4. E.1. *Blue Cross Funding for Comprehensive Plan Community Engagement
Activities
5. RECOGNITION OF INVOLVED CITIZENS BY CITY COUNCIL - Provides an
opportunity for the public to address the Council on items which are not on the agenda.
Comments should not be more than five minutes in length. The Mayor may adjust that
time limit based upon the number of persons seeking to comment. This comment
period may not be used to make personal attacks, to air personality grievances, to
make political endorsements or for political campaign purposes. Council Members will
not enter into a dialogue with citizens, and questions from Council will be for
clarification only. This period will not be used to problem solve issues or to react to
the comments made, but rather for informational purposes only.
6. Business removed from consent will be discussed at this time
7. General Business
A. Parks and Recreation
7. A.1. Park Dedication Fees
B. General Administration
7. B.1. 2016 Annual Financial Report, Audit Presentation and Review by Staff
from BerganKDV
C. Planning and Development
7. C.1. Text Amendment to Allow Residential Use in Major Rec Zone
7. C.2. Orderly Annexation Agreement with Jackson Township
7. C.3. Set Public Hearing for Canterbury Tax Increment Financing District
7. C.4. Request for Extended Construction Hours by School District Contractor
7. C.5. Update on City Owned Property at 69/169
7. C.6. Vierling Drive Improvements Contract
8. Reports
8.A. Liaison and Administrator
8.B. City Bill List
9. Other Business
10. Adjournment to July 18, 2017 at 7:00 p.m.
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*4.A.1.
After being declared surplus, the vehicles will be sold at auction and the proceeds, if any, will
be disbursed according to Minnesota State Statute.
Budget Impact:
None
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*4.B.1.
Council has indicated a desire to have the assessment policy for alley reconstruction be
consistent with street reconstruction which is 30%. The attached resolution amends the
special assessment policy for alleys in the central business district.
Further analysis and research is needed to recommend any changes to the assessment policy
for alleys outside the central business district.
Budget Impact:
This amendment to the special assessment policy would decrease the amount the City would
pay.
ATTACHMENTS:
Resolution 7908
Assessment Policy
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RESOLUTION 7908
A Resolution Amending the Special Assessment Policy
WHEREAS, on January 19, 1992, the City Council of Shakopee adopted the Special
Assessment Policy by Resolution No. 3735; and,
WHEREAS, the Special Assessment Policy was recently amended by Resolution 7025 on
August 17, 2010; and,
WHEREAS, the City Council desires to amend the Special Assessment Policy.
1. In Section X, Paragraph A.6. Alleys the last sentence is changed to read: For CBD
alleys, the City Council will assess 30% of the alley improvement.
City Clerk
ENGR/2017-PROJECTS/COUNCIL/RES7908-Amendspecialassessmentpolicy
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*4.B.2.
Attached is a letter from Lennar requesting extended work hours on Saturday to start at 8
a.m. until the Ridge Creek 1st Addition project is completed by the end of the construction
season.
This request is being made to help expedite the work and meet the schedule for this project to
be completed prior to the end of the construction season.
If Council approves the suspension, a public notice to meet the City Code requirements and
notice such as a news release would be placed in the Shakopee Valley News.
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Budget Impact:
None
ATTACHMENTS:
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Dear Mr. Halverson,
Lennar is asking on behalf of Enebak Construction for permission to start 1 hour earlier on Saturdays at
8:00 am instead of 9:00 am on our Ridge Creek project.
Mark Bode
Lennar Homes
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*4.C.1.
Many generous donators have come forward in many ways and the park was mostly
completed in October of 2016. The donor wall is currently under construction however
donors can also be recognized on a bench or piece of equipment.
Per city requirements for donations, any monetary donation of $1000 or more needs to be
accepted by two-thirds vote of the City Council. The City has received a donation of $1000
from Joe Theis in honor of his grandparents, Gene and Esther Brown and his uncle Tim
Ratigan. The Shakopee Valley Lions would also like to donate an additional bench to the
perimeter of the playground.
Budget Impact:
The donations will assist the city to complete the donor wall and add benches to the
playground.
ATTACHMENTS:
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Resolution No 7910
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RESOLUTION NO. 7910
______________________________
William Mars
Mayor of the City of Shakopee
ATTEST:
___________________________________
City Clerk
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*4.D.1.
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Shakopee City Council Minutes
June 20, 2017
7:00 PM
City Hall 129 Holmes St.
Staff Present: Administrator Bill Reynolds, Assistant Administrator Nate Burkett, City
Attorney Jim Thomson, Fiance Director Darin Nelson, Assistant City Engineer Ryan
Halverson, Planning and Development Director Michael Kerski, Senior Planner Mark
Noble, Senior Planner Kyle Sobota, Park and Recreation Director Jamie Polley, City
Clerk Lori Hensen
2. Pledge of Allegiance
3. Special Presentation
3.A. MRPA Award of Excellence
4. Approval of Agenda
Councilmember Jay Whiting made a motion to approve the agenda as presented, seconded
by Councilmember Kathi Mocol and the motion passed.
5-0
5. *Consent Business - (All items listed in this section are anticipated to be routine. After
a discussion by the Mayor there will be an opportunity for members of the Council to
remove any items from the consent agenda for individual discussion. Those items
removed will be considered following the Public hearing portion of the agenda. Items
remaining on the Consent Agenda will not be discussed and will be approved in one
motion.)
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Councilmember Jay Whiting made a motion to approve consent agenda, seconded by
Councilmember Kathi Mocol and the motion passed.
5-0
A. Planning and Development
*5. A.1. *Vacation of Public Right-of-Way and Drainage & Utility Easements
Approve Resolution No. 7896, a resolution setting the public hearing date to consider
the vacation of a public right-of-way (Shenandoah Drive) and public drainage &
utility easements for property located north of Eagle Creek Blvd., East of
Shenandoah Drive extended at Eastway Avenue, South of 4th Avenue East and West
of Vierling Drive at 12th Avenue East. (Motion was carried under consent agenda.)
B. Public Works and Engineering
*5. B.1. *Parking Control Change on Garden Lane
Approve the parking control change on Garden Lane as outlined in the memo and the
attached drawing. (Motion was carried under consent agenda.)
*5. B.2. *Extended Construction Hours
Approve a suspension of City Code Sec. 130.45, Noise Elimination and Noise
Prevention, Subd. C, Hourly Restrictions on Certain Operations, 4, allowing D.R.
Horton and their contractors to perform work from 7 a.m. to 8 p.m. on weekdays and
8 a.m. to 5 p.m. on Saturdays through the end of October or earlier if worked is
completed and directing staff to publish notice of the suspension terms with conditions
as recommended by staff. (Motion was carried under consent agenda.)
C. Parks and Recreation
*5. C.1. *Lease Agreement with Xcel Energy
Approve a lease agreement with Xcel Energy for use of 30 acres of land south of
Quarry Lake Park for soft surface trails. (Motion was carried under consent agenda.)
D. General Administration
*5. D.1. *City Council Minutes
Approve the minutes from June 6, 2017. (Motion was carried under consent agenda.)
*5. D.2. *Reorganization of IT Division
Approve reclassification of one IT Assistant to the position of IT Specialist -
Applications. (Motion was carried under consent agenda.)
*5. D.3. *Temporary Liquor License - Saint Joachim & Anne
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Approve the temporary liquor license for Saint Joachim & Anne's annual Julifest
event being held July 28 through July 30, 2017. (Motion was carried under consent
agenda.)
*5. D.4. *Badger Hill request to allow alcohol to be consumed in Parking Lot
Approve the suspension of city code 114.11 Consumption and possession of
alcoholic beverages on street, public property, private parking lots to which the public
has access, and other private property, allowing Badger Hill Brewery to hold their 5th
Beerthday Party Event held on June 24, 2017. (Motion was carried under consent
agenda.)
*5. D.5. *Performance Measurement Program
Adopt Resolution No. 7906 Which Adopts the State of Minnesota Performance
Measurement Program. (Motion was carried under consent agenda.)
6. RECOGNITION OF INVOLVED CITIZENS BY CITY COUNCIL - Provides an
opportunity for the public to address the Council on items which are not on the agenda.
Comments should not be more than five minutes in length. The Mayor may adjust that
time limit based upon the number of persons seeking to comment. This comment
period may not be used to make personal attacks, to air personality grievances, to
make political endorsements or for political campaign purposes. Council Members will
not enter into a dialogue with citizens, and questions from Council will be for
clarification only. This period will not be used to problem solve issues or to react to
the comments made, but rather for informational purposes only.
7. Business removed from consent will be discussed at this time
8. Public Hearings
8.A. Vacation of Public Drainage & Utility Easement - SPUC
Councilmember Jay Whiting made a motion to open the public hearing, seconded by
Councilmember Kathi Mocol and the motion passed.
5-0
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8.B. (SPUC) Shakopee Avenue Electric Underground Project 2017-9
Councilmember Kathi Mocol made a motion to open the public hearing, seconded by
Councilmember Mike Luce and the motion passed.
5-0
Councilmember Jay Whiting made a motion to close the public hearing, seconded by
Councilmember Mike Luce and the motion passed.
5-0
Councilmember Kathi Mocol made a motion to approve Resolution 7903 and enter
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into an agreement with CPM or its affiliates to redevelop sites for housing (City Hall)
and Hotel (First Ave), seconded by Councilmember Jay Whiting and the
motion passed.
3-1
Nays: Lehman
Abstain: Luce
11. A.4. West Vierling Acres Apartments
Councilmember Jay Whiting made a motion to adopt Ordinance No. 965, which
rezones the property from R-3 Multiple Family Residential to R-4, High Density
Residential, seconded by Councilmember Kathi Mocol and the motion passed.
3-2
Nays: Lehman, Luce
Councilmember Jay Whiting made a motion to adopt Resolution No. 7905, which
approves the Final Plat of West Vierling Acres Third Addition, a conditional use
permit for an over-height structure, and a Planned Unit Development (PUD)
Amendment to allow development of no more than a 133-unit apartment building,
seconded by Councilmember Kathi Mocol and the motion passed.
3-2
Nays: Lehman, Luce
11. A.5. Purchase Agreement with Booyaah Properties II
Councilmember Jay Whiting made a motion to adopt Resolution 7904 to acquire the
two parcels to protect the rail spurs for the industrial park, seconded by
Councilmember Kathi Mocol and the motion passed.
5-0
B. General Administration
11. B.1. Monthly Financial Review
11. B.2. Updated Liaisons List
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Councilmember Jay Whiting made a motion to approve updated liaisons list as
presented, seconded by Councilmember Kathi Mocol and the motion passed.
5-0
11. B.3. Capital Bonding Request
Councilmember Kathi Mocol made a motion to adopt Resolution 7899, the City of
Shakopee's application to the State of Minnesota's 2018 capital budget, seconded by
Councilmember Jay Whiting and the motion passed.
5-0
12. Reports
12.A.Liaison and Administration
12.B.City Bill List
13. Other Business
Councilmember Kathi Mocol made a motion to adjourn to July 5, 2017 at 7:00 p.m.,
seconded by Councilmember Matt Lehman and the motion passed.
5-0
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*4.D.2.
This policy establishes a policy that clarifies those circumstances where it is appropriate for
the city to provide wireless service to an employee for the performance of their duties and
gives options as to how that service will be provided.
The biggest change in this policy from the existing practice is that the city will offer eligible
employees a $25.00/month stipend for use of their personal device.
The biggest concern with this policy is data practices. Employees opting to use their personal
device for city business must be aware that in the event there is a data practices request,
employees must report certain data in accordance with the law. This will include work
related (not personal) text messages and phone records. Personal information on personally
owned devices is not available through public data requests. Emails on personally owned
devices will be retained through the city's server and are not of concern.
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Data security is also of concern. This policy allows for the IT division to create rules related
to password protection and mobile device management to ensure data security when data is
stored on a personally owned device.
The $25/per month stipend is set at that level to ensure that each device transitioned from
city-paid to a stipend will result in a cost savings for the city.
Budget Impact:
This policy will not increase the city's expense. Depending on how many employees choose
to use their personally owned device - adoption of this policy may save up to approximately
$10,000 per year.
ATTACHMENTS:
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Mobile Device Policy
(Chapter, Section, Code Added by Administration)
Adopted:
Amended:
POLICY CONTENTS
A. Scope ................................................................................................................................................................. 1
B. Purpose ............................................................................................................................................................ 1
C. Business Need Required ............................................................................................................................ 1
D. Mobile Communication Device and Service Options ...................................................................... 2
E. City Issued Mobile Devices and Service ............................................................................................... 2
F. Personal Mobile Devices and Service with city Stipend ................................................................ 3
G. Personal Mobile Devices and Service without city Stipend ......................................................... 3
H. Mobile Device Usage, Generally .............................................................................................................. 4
A. SCOPE
This policy applies to all city of Shakopee employees.
B. PURPOSE
This purpose of this policy is to ensure that city employees can use mobile communication
devices in the course of their duties to promote efficiency, ensure effective communication
and improve customer service in a cost-effective manner. This policy defines acceptable
use of mobile communication devices, the circumstances under which the city will provide
for a mobile communication device and/or service, and how the city will provide for mobile
communication devices and/or service. Employees who abuse and/or misuse mobile
communication devices under this policy may be subject to disciplinary action.
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The employees position is such that providing for mobile communications will improve
the employees efficiency.
Other justification as approved by the city administrator.
Page 2 of 4
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F. PERSONAL MOBILE DEVICES AND SERVICE WITH CITY STIPEND
If the department head has determined that there is a business need and the employee
desires to use their personal mobile device for city business, the city may offer a stipend of
$25.00 per month for reasonable use of the employees personal mobile device and service.
The approved stipend is agreed upon as full and complete compensation by the city to
the employee for the use of their personal mobile device for business purposes. The
stipend is inclusive of minutes, data, text messaging, access and all other charges. The
city shall not reimburse the employee for overages of minutes, data or texts or other
expenses beyond the approved stipend.
Employees accepting the stipend under this section are responsible to ensure that their
service is active. Employees who allow their service to lapse may be required to
reimburse the city all or part of the stipend if service lapses.
The cellular phone number will be listed in the city Staff Directory and on business
cards and email signature lines as appropriate.
Personal mobile devices used for business purposes must have appropriate security
technology and password protection as determined by the Information Technology
Division.
As determined by the Information Technology Division, mobile devices under this
section may have mobile device management software in place to enforce security
protocols.
An employee separating employment with the city who has used their personal device
for city business must delete all business-related data from their device, to be verified
by the Information Technology Division.
The Information Technology Division will not support the device or applications on the
device.
Loss or damage of the device during city or personal use will not be reimbursed by the
city.
Employees who use their personal mobile device for business purposes under this
section acknowledge and agree to comply with data practices laws and policies. Data on
personal mobile devices under this section may be subject to data practices laws and
policies including but not limited to:
o Emails, documents, texts, and any other data created or maintained on the device for
business use
o Phone records, including numbers called, times, and durations of calls made for
business purposes.
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The city shall not reimburse employees for overages or use of overages of minutes, data
or texts or other expenses related to personal mobile device usage for business
purposes.
The employee shall not have official city email or records on their personal mobile
device unless the Information Technology Department approves.
An employee separating employment with the city who has used their personal device
for city business must delete all business-related data from their device, to be verified
by the Information Technology Division.
The Information Technology Division will not support the device or applications on the
device.
Loss or damage of the device during city or personal use will not be reimbursed by the
city.
Employees who use their personal mobile device for business purposes under this
section acknowledge and agree to comply with data practices laws and policies. Data on
personal mobile devices under this section may be subject to data practices laws and
policies including but not limited to:
o Emails, documents, texts, and any other data created or maintained on the device for
business use
o Phone records, including numbers called, times, and durations of calls made for
business purposes.
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*4.D.3.
The Police Department has conducted the customary background investigation and has
advised that it identified nothing that would prohibit the issuance of the licenses.
Budget Impact:
None.
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*4.D.4.
The Police Department has conducted the customary background investigation and has
advised that it identified nothing that would prohibit the issuance of the licenses. Inspections
by the Building Department and Fire Department are still needed and will be completed
before final issuance of the licenses.
Budget Impact:
None.
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*4.D.5.
Resolution 7907
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RESOLUTION 7904
WHEREAS, the 1990 legislature adopted a law which requires municipal approval in order for
Gambling Control Board to issue or renew premises permits; and
WHEREAS, the Shako Valley Amateur Hockey Association is seeking a Premises Permit for the
site at the Muddy Cow, 1244 Canterbury Road, Shakopee, Minnesota.
That the Premises Permit for the Shako Valley Amateur Hockey Association at Muddy Cow, 1244
Canterbury Road, Shakopee, Minnesota, be approved.
Adopted in regular session of the City Council of the City of Shakopee, Minnesota, held this 5th
day of July, 2017.
____________________________________
Mayor of the City of Shakopee
ATTEST:
______________________________
City Clerk
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*4.E.1.
The city's application included a request for funds to support increased community
engagement activities supporting Envision Shakopee, the city's 2040 comprehensive planning
process. The application was successful and the city was awarded $12,500 in funding. Blue
Cross offers the funding via a funding agreement.
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The city's request was fully funded at $12,500. This includes $6,500 to fund additional
printed materials, food, and workshop and engagement supplies and $6,000 in community-
based organization subcontracts.
ATTACHMENTS:
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ACTIVE PLACES DEMONSTRATION PROJECTS AGREEMENT
This Active Places Demonstration Projects Agreement ("Agreement") is entered into as of June 13, 2017, (the
"Effective Date") by and between City of Shakopee, Minnesota (Shakopee), with its address at 129 Holmes St South,
Shakopee, Minnesota 55379, and BCBSM, Inc., dba Blue Cross and Blue Shield of Minnesota (Blue Cross) located
at 3535 Blue Cross Road, Eagan, Minnesota 55122.
WHEREAS, Blue Cross is committed to initiatives that increase walking and bicycling for both transportation and recreation
as a means of improving the health of Minnesotans through active living. An Active Places Demonstration Project
supports Blue Crosss goals of increasing walking and biking rates by creating community destinations and improving
walking and biking routes. An Active Places Demonstration Project will transform previously abandoned or avoided places
into areas where people want to be physically active. An Active Places Demonstration Project aims to build support for
wider community changes over time. An Active Places Demonstration Project address the well-researched principal that
people are more likely to walk or bike if the route and the routes surroundings are pleasant, if there are destinations along
the route, and if they can reach those destination on foot or bike.
1. Description of the Project. Shakopee desires to participate in an Active Places Demonstration Project throughout the
city to engage the growing number of people of color in the 2040 Comprehensive Plan which sets the tone for future
planning, making it the communitys greatest opportunity to influence policy future infrastructure projects, and contribute
to the future of the city. Activities include:
A. Conducting a "hands-on" workshop using maps and craft supplies. The workshop will be conducted throughout the
community with small, targeted focus groups. People will be able to share their specific ideas while doing art-based
activities.
B. Engaging students of all cultures using photovoice which is a visual engagement technique. The city, Shakopee
High School, and District 288 will partner and use photovoice to use imagery to promote engagement among
students.
C. Establishing city presence at community events, festivals, and gatherings. The city will bring a pop-up engagement
booth to community gatherings, for example a five-week summer concert series in which the city will be present.
D. Creating and providing "Meeting in a Box" materials which allows organizations, residents, and businesses the
opportunity to host vision meetings without city staff being present. Materials will be created to help facilitate
discussions and gather feedback.
The first phase of the community engagement, focused on the vision of the community, will take place April through
November 2017. Creative workshops will take place intermittently throughout the city during this time period. A summer
concert series will take place in downtown Shakopee for five weeks in July and August. Student engagement at the
Shakopee High School will take place in the fall. Collectively, these activities constitute the Project.
2. Fees. Blue Cross shall make a $12,5000 financial contribution to Shakopee to support the Project, subject to the terms
and conditions of this Agreement. Shakopee shall refund Blue Cross financial contribution if it is unable to execute the
terms and conditions of this Agreement within 30 days.
3. Term and Termination. This Agreement will be effective as of the last date of signature below. This Agreement may be
terminated by either party by providing the other with at least 30 days written notice. In the event of termination by
Shakopee prior to Project completion, Shakopee shall refund any unused funds.
4. Shakopee shall provide Blue Cross with (a) proofs for review and approval prior to publication (including paper or
electronic publishing, and creation of audio/video documentation) of any Project-related materials containing Blue
Crosss name, logo, or references to Blue Crosss funding; and (b) the opportunity to approve or reject the placement,
color or size of Blue Crosss name or logo on all Project-related materials. Blue Cross retains all right, title, and interest
in its corporate name, logo, and taglines, and nothing in this Agreement will be construed to constitute a waiver of any
other right or remedy Blue Cross may have relative to the use of its corporate name or logo by Shakopee.
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5. Shakopee shall acknowledge Blue Cross in all promotional materials related to the Project including but not limited to
fliers, posters, brochures, programs, website, signage, banners, T-shirts, advertisements (both print and electronic),
event signage, onsite messages related to community health, promotional literature, brochures, publications, press
releases, advertisements and digital/multi-media content. Shakopee will provide Blue Cross the opportunity to include
promo item(s) in giveaway bags, if applicable, and/or to distribute promo items onsite. Shakopee shall use the following
language:
Preferred copy:
Funding for this project is provided by the Center for Prevention at Blue Cross and Blue Shield of Minnesota, as
part of Blue Cross long-term commitment to tackling the leading causes of preventable disease: tobacco use, lack
of physical activity and unhealthy eating.
Copy for use when Blue Cross is not the primary funder:
Funding for this project is provided in part by the Center for Prevention at Blue Cross and Blue Shield of Minnesota.
6. Shakopee will work with Blue Cross on public relations efforts related to the Project. Shakopee shall not make any
media statements on behalf of Blue Cross under any circumstance. However, Shakopee may publicize that Blue Cross
has funded the Project and advise media to contact Blue Cross directly for more information. In addition, if any media
outlet contacts Shakopee requesting comment on behalf of Blue Cross, Shakopee shall contact Blue Crosss
communications staff immediately. Any proactive outreach to media regarding the Project shall be coordinated with
Blue Crosss communications staff in advance.
7. Grant of license. Shakopee hereby grants to Blue Cross and its affiliates a worldwide, transferable, sublicensable,
perpetual, non-exclusive, royalty free, fully paid, license to use, reproduce, display, and/or create derivative works
(including to adapt or excerpt for Blue Crosss use, including for commercial purposes) from any written reports,
promotional materials, toolkits, educational materials, audio, video and/or other works created by or on behalf of
Shakopee in connection with the use, display, operation, modification, distribution and/or commercial exploitation of the
Project. Further, Shakopee hereby grants to Blue Cross and its affiliates a non-transferable, non-sublicensable, non-
exclusive, royalty free, fully paid, license to use, reproduce and display such representations of the Project (including
its name and logo) as are reasonably necessary for Blue Cross to fulfill the purposes of this Agreement.
8. Deliverables:
A. Within 12 months after the Project closes, Shakopees project manager will participate in a one-hour key information
interview with Blue Cross, or with Blue Crosss contracted vendor, to provide feedback on progress towards
Projects long term goals and learnings.
B. Within one month of the completion of the Project, or by December 31, 2017, whichever occurs first, Shakopee
shall submit to Blue Cross a written report that includes (i) a description of the process through which the Project
was implemented; (ii) the Projects budget; (iii) how the Project advanced Shakopees long term visions, as
described in Projects application for funding; and (iv) an evaluation of the Project, which shall include an
assessment of the Projects successes, weaknesses, and community responses to the Project.
9. Shakopee acknowledges and agrees that it will comply with all applicable laws, rules, and regulations in executing the
work under this Schedule including compliance with any tax withholdings, filings, or other reporting obligations.
10. The parties acknowledge that execution of this Agreement does not constitute an association for the purpose of
establishing a partnership or a joint venture, nor create any trustee or agency relationship between the parties.
11. Each party hereby represents that it has full power and authority to enter into this Agreement and to perform its
obligations; it has obtained all permits, licenses, and other governmental authorizations and approvals required for its
performance under this Agreement; and to the best of its knowledge and belief, the services to be rendered and the
materials provided by each party under this Agreement neither infringe nor violate any patent, copyright, trade secret,
trademark, or other proprietary right of any third party.
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12. Indemnification. Shakopee shall indemnify, defend and hold harmless Blue Cross, its trustees, officers, employees and
affiliates from and against all claims, damages, actions, expenses and costs (including reasonable attorneys' fees)
which result or arise from the Project, from this Agreement or a breach of this Agreement.
13. Governing Law. This Agreement will be governed by, and construed in accordance with, the laws of the State of
Minnesota.
14. Assignment. Neither party shall sell, transfer or assign this Agreement, or delegate its obligations hereunder, without
the prior written consent of the other party, except that Blue Cross may assign this Agreement in whole or in part to any
affiliate of Blue Cross upon notice to Shakopee.
15. Shakopee shall not solicit, and shall not engage as a sponsor, any other health insurance plan or third party claim
administrator, or any entity owned or controlled by, or under common ownership or control with, any other health
insurance plan or third party claim administrator with respect to funding, promotion or engagement in the Project.
16. Shakopee warrants that it has not performed services funded by or to the benefit of the tobacco industry within the past
five (5) years. Furthermore, Shakopee will not pursue or accept a contract, including sponsorship or participation, with
a tobacco company during the term of this Agreement. Shakopee will make every reasonable effort to ensure that any
sponsors or corporate participants in the Project have not been involved with other projects funded directly or indirectly
by the tobacco industry, or any other projects that could reasonably be considered counter to tobacco reduction or
cessation efforts. In addition, Shakopee will make every reasonable effort to ensure that any subcontractors performing
Services under this Agreement have not been involved in projects funded directly or indirectly by the tobacco industry,
or any projects that would be considered counter to Blue Crosss initiatives on tobacco use reduction or cessation.
17. Shakopee represents and warrants that it has not had any relationship with a representative of, nor entity involved in,
the tobacco industry within the past 5 years.
18. Audit. During the term of this Agreement, and for a period of one year after its termination or expiration date, Blue Cross
may utilize its internal auditors or engage a third-party auditor reasonably acceptable to Shakopee to perform a
confidential audit of Shakopees compliance with its obligations under this Agreement. In addition, Shakopee shall
reasonably participate in any audits initiated by a customer or regulator of Blue Cross, to the extent that Shakopee's
performance of the Project is within the scope of such audit. Blue Crosss reasonable cooperation with audits is part of
the Project, and will be provided at no additional cost to Blue Cross.
If any audits of Shakopee result in an adverse or qualified opinion, (a) Shakopee shall provide Blue Cross a detailed
remediation plan (including dates), and use reasonable efforts to remediate (at its own expense) the condition(s) giving
rise to such opinion, and (b) Blue Cross may utilize its internal auditors or engage a third party to specifically re-test
activities related to such opinion, to verify closure, or identify potential impact to Blue Cross.
This Agreement represents the entire agreement between the parties with respect to its subject matter, and supersedes all
prior agreements relating to its subject matter.
Page 3 of 9
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This Agreement has been duly executed by the parties hereto as of the dates set forth below.
BCBSM, INC., dba Blue Cross and Blue Shield City of Shakopee, Minnesota
of Minnesota
By: By:
Signature Signature
Janelle Waldock
Vice President, Community Health & Health Equity
Print Name Print Name
Date Date
Page 4 of 9
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EXHIBIT A
TO THE
ACTIVE PLACES DEMONSTRATION PROJECTS AGREEMENT
Page 5 of 9
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7.A.1.
Adopt Ordinance No. 962, Amending the City's Adopted 2017 Fee Schedule.
Adopt Ordinance No. 963, Amending Shakopee City Code Section 150.65, Parks
and Dedications.
Recommendation:
Approve the actions requested.
Discussion:
Park Dedication Fees
Development is increasing within the city and many of the city fees are under review. The
current park dedication fees have not been revised since 2005. Revisions to the fees have
been recommended over the last 10 years however the fees remain unchanged. There is
a potential for a number of higher density housing projects which have encouraged the city to
review the park dedication fees. In many studies the city's park dedication rate is higher then
average for both single family ($5,340/unit) and multi-family ($4,450/unit) residential
housing development and below average for commercial/industrial ($6,930/acre)
development.
The park dedication fees collected are used to construct new parks within the city for the
residents of Shakopee to enjoy. The city also wants to encourage development or
redevelopment that offers the residents nice places to live and work. To find the balance
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between the fees needed to construct the park system and encouraging development, data
was collected from a number of metropolitan cities including 10 cities that have been
designated as comparable cities to Shakopee.
After reviewing the data collected staff and the PRAB is recommending that the fees for
single family ($5,340/unit) and townhouses ($4,450/unit) remain unchanged and the fee for
commercial/industrial development increase from $6,930/acre to $11,000/acre. The increase
to the commercial/industrial fee is calculated utilizing a formula that the city has used in the
past to determine this fee. The formula averages current land sale prices divided by a
dwelling per unit amount of 2.5 multiplied by 10%. The cost per dwelling unit is then
multiplied by 2.5/acre to get the per acre price. ($110,000/acre/2.5 DUA *10% = $4,400*2.5
DUA = $11,000/acre).
The recommended changes to the multi-family fees are based on the kind of units being
proposed:
Market Rate units with less than 60% 1BR and studios $4,450/unit (unchanged)
Market Rate units with more than 60% 1BR and studios $2,225/unit
Projects in redevelopment areas will be discussed as part of the Redevelopment TIF.
The reduced rate for projects that have more then 60% 1BR and studios is based on the fact
that typically 1-2 people are living in each smaller unit, versus 2-6 people living in 2 or 3
bedroom units. Projects in redevelopment areas are unique to the City of Shakopee and
relate only to the downtown district or possible Canterbury Park area. These area have a
number of challenges and higher costs of development due to reduced space and existing
facilities and infrastructure. The City Council has the ability to negotiate the park dedication
fees for Redevelopment TIF projects.
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In addition, in calculating park dedication fees or land to be dedicated all wetland, ponding
and city accepted drainageways and utility easements were deducted. The ordinance states in
item B.10 that "Buildable" park land must be dedicated. Wetlands and ponding are not
considered buildable park land and are therefore are still removed from the calculation
however land that has a drainageway and/or utility easement through it is still buildable
parkland. Drainageways and utility easements have therefore been removed as a deduction to
the park dedication calculation.
Budget Impact:
Revising the park dedication fees is anticipated to have a positive impact on development
within the city resulting in increased park dedication revenue. Attached is an example of the
results of the proposed fees.
ATTACHMENTS:
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ORDINANCE NO. 962, FOURTH SERIES
WHEREAS, by Ordinance No. 954, the City Council established a fee schedule effective
January 1, 2017; and
WHEREAS, the City Council has determined that it is desirable to modify the portion of
the 2017 Fee Schedule pertaining to Park Dedication Fees for Multi-Family Apartments and
Commercial/Industrial property.
B. Park Dedication Fees (City Code 150.65. These are set by City Council in
consultation with Park and Recreation Advisory Board)
Cash in lieu of land dedication fees:
1. Residential/Single-family/Duplex (per unit) $5,340/unit
2. Multi-family Apartment
less than 60% 1BR or Studio (per unit) $4,450/unit
Multi-family Apartment
60% or more 1BR or Studio (per unit) $2,225/unit
Adopted in regular session of the City Council of the City of Shakopee, Minnesota held this 5th
day of July, 2017.
__________________________________
Mayor of the City of Shakopee
ATTEST:
________________________
Acting City Clerk
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ORDINANCE NO. 963
(1) As a prerequisite to subdivision approval, subdividers shall dedicate land for parks,
playgrounds, public open spaces, and trails and/or shall make a cash contribution to the Citys Park
Fund and Trail Fund as provided by this section.
(2) Land to be dedicated shall be reasonably suitable for its intended use and shall be at a
location convenient to the people to be served. Factors used in evaluating the adequacy of the
proposed park and recreation areas shall include size, shape, topography, geology, hydrology, tree
cover, access, and location.
(3) The Parks and Recreation Advisory Board shall recommend to the Planning
Commission and City Council the land dedication and cash contribution requirements for proposed
subdivisions.
(4) Changes to the density of plats shall be reviewed by the Parks and Recreation
Advisory Board for reconsideration of park dedication and cash contribution requirements.
(5) When a proposed park, playground, recreational area, school site, or other public
ground has been indicated in the citys official map or comprehensive plan and is located in whole
or in part within a proposed plat, it shall be designated as such on the plat and shall be dedicated
to the appropriate governmental unit. If the subdivider elects not to dedicate an area in excess of
the land required hereunder for such proposed site, the city may consider acquiring the site through
purchase or condemnation.
(6) Land conveyed or dedicated to the city shall not be used in calculating density
requirements of the city zoning ordinance, and shall be in addition to and not in lieu of open space
requirements for planned unit developments.
(7) In establishing the amount of land to be dedicated or preserved or the amount of the
cash contribution, the city will give due consideration to the open space, recreational, or common
areas and facilities proposed by the applicant to be open to the public.
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(8) The city, upon consideration of the particular type of development, may require larger
or lesser parcels of land to be dedicated if the city determines that present or future residents would
require greater or lesser land for park and playground purposes.
(9) In residential plats, the city shall have a standard of 1 acre of park land for every 75
people. Thus, 1 acre of land shall be conveyed to the city as an outlot warranty for every 75 people
the platted land could house based on the following population calculations.
(10) In plats other than residential, the city hereby finds that, as a general rule, it requires
that an amount of land equal to 10% of the buildable land proposed to be subdivided be dedicated
or reserved to the public for public use for parks, playgrounds, trails, wetlands, or open space.
Buildable land is determined by calculating the gross acreage of all land in the proposed
subdivision in its pre-subdivided condition excluding wetlands as defined in 151.002. Should
the land to be dedicated have greater fair market value than the average fair market value in the
plat, the city shall only be authorized to require dedication of an amount of land equal to 10% of
the fair market value of all the property being platted.
(11) In lieu of park land dedication, the city may require an equivalent cash dedication
based upon the average fair market value of undeveloped land that is, or under the citys adopted
comprehensive plan, may be served by municipal sanitary sewer and water service. The cash
dedication requirement shall be established annually by the City Council.
(12) The subdivider will be required to construct all public trails within the development
or adjacent at the time of development.
(123) In lieu of trail donation, trail construction, or trail easement dedication, the city may
require a cash donation for the trail system. The cash dedication requirement shall be established
annually by the City Council. Dedication for trails in the form of cash shall apply only to residential
plats.
(134) The city may elect to receive a combination of land and cash for park use. The city
shall determine the amount of land dedication it requires, and the cash contribution shall be
calculated based on the percentage of unmet land dedication.
(145) Planned unit developments with mixed land uses shall make cash and/or land
contributions in accordance with this section based upon the percentage of land devoted to the
various uses.
(156) Park and trail cash contributions are to be calculated based on the fees in place at
the time of the final plat approval.
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(167) The cash contributions for parks and trails shall be deposited in either the citys
Park Reserve Development Fund or Multi-Purpose Pedestrian Fund and shall be used only for
acquisition, improvement, development, or redevelopment of parks and trails.
(189) Wetland and ponding areas, drainageways and utility easements accepted by the
city shall not be considered in the park land and/or cash contribution to the city.
(1920) When a proposed trail has been indicated in the citys official comprehensive plan
map, and it is located in whole or in part within the proposed plat, it should be designated on the
plat and should be dedicated to the city. If the subdivider elects not to dedicate an area in excess
of the land required for a trail, the city may consider acquiring it through condemnation.
(2021) Required land dedication and/or payment of fees in lieu of land dedication shall
be required at the time of recording the final plat.
Section 2. Effective Date. This ordinance becomes effective from and after its passage and
publication.
Adopted in regular session of the City Council of the City of Shakopee, Minnesota held this 5th
day of July, 2017.
___________________________________
Mayor of the City of Shakopee
Attest:
_________________________,
City Clerk
Published in the Shakopee Valley News on the ______ day of _____________, 2017.
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Current Projects Proposed Fees
Acres/lots/units
Shakopee Crossing Limited Marcus Theater $ 57,670.77 8.32 $ 91,540.90
Canterbury Park Existing $ 153,580.04 $ 153,580.04
Opus Development Warehouse $ 42,240.22 6.10 $ 67,047.97
Menden Addition SF Subdivision $ 64,080.00 12.00 $ 64,080.00
Ivy Properties (Henderson) Elderly Apartments $ 226,950.00 51.00 $ 226,950.00
HY-VEE Grocery Store $ 92,723.40 13.38 $ 147,180.00
Praire Meadow SF Subdivision $ 25,824.24 12.00 land + cash $ 25,824.24
Duke Realty My Pillow $ 116,077.50 16.75 $ 184,250.00
$ 779,146.17 $ 960,453.15
$ 2,214,250.00
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Park Dedication Fees Single Family Townhouses Apartments Commercial Industrial
Easement areas included in fee calculation area. PD calculated on gross land area.
All developments will be required to construct any public trails in development or adjacent.
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7.B.1.
2016 CAFR
2016 Compliance Report
2016 Communication Letter
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Comprehensive
ANNUAL FINANCIAL REPORT
For the fiscal year ended December 31, 2016
Department of Finance
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(THIS PAGE LEFT BLANK INTENTIONALLY)
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CITY OF SHAKOPEE
TABLE OF CONTENTS
SECTION I
Page
INTRODUCTORY SECTION
Elected Officials and Administration................................................................................ 1
Organization Chart ............................................................................................................ 2
Letter of Transmittal ......................................................................................................... 3
Certificate of Achievement for Excellence in Financial Reporting .................................. 9
SECTION II
FINANCIAL SECTION
Independent Auditors Report........................................................................................... 11
Managements Discussion and Analysis (Unaudited) ...................................................... 15
Basic Financial Statements:
Government-Wide Financial Statements:
Statement of Net Position ..................................................................................... 28
Statement of Activities .......................................................................................... 29
Fund Financial Statements:
Balance Sheet Governmental Funds .................................................................. 30
Reconciliation of the Balance Sheet to the Statement of Net Position
Governmental Funds ........................................................................................... 31
Statement of Revenues, Expenditures and Changes in Fund Balances
Governmental Funds ........................................................................................... 32
Reconciliation of the Statement of Revenues, Expenditures and Changes in
Fund Balances to the Statement of Activities Governmental Funds ............... 33
Statement of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual General Fund ..................................................................... 35
Statement of Net Position Proprietary Funds..................................................... 36
Statement of Revenues, Expenses and Changes in Fund Net Position
Proprietary Funds ................................................................................................ 37
Statement of Cash Flows Proprietary Funds ...................................................... 38
Combined Statement of Fiduciary Net Position ................................................... 41
Statement of Net Position Component Unit....................................................... 42
Statement of Revenues, Expenses and Changes in Fund Net Position
Component Unit ................................................................................................. 43
Notes to the Financial Statements ............................................................................... 45
Required Supplementary Information:
Schedule of Funding Progress Other Post Employment Benefits ........................... 96
Schedule of City's Proportionate Share of Net Pension Liability General
Employees Retirement Fund .............................................................................. 97
Schedule of City's Proportionate Share of Net Pension Liability Public
Employees Police and Fire Retirement Fund..................................................... 98
Schedule of Component Units' Proportionate Share of Net Pension Liability
General Employees Retirement Fund ................................................................ 99
Schedule of City Contributions General Employees Retirement Fund ..................... 100
Schedule of City Contributions Public Employees Police and Fire Retirement
Fund .................................................................................................................. 101
Schedule of Component Unit Contributions General Employees Retirement Fund . 102
Schedule of Changes in the Net Pension Liability and Related Ratios
Fire Relief Association ...................................................................................... 103
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CITY OF SHAKOPEE
TABLE OF CONTENTS
SECTION II (Continued)
FINANCIAL SECTION
Required Supplementary Information: (Continued)
Schedule of City Contributions and Non Employer Contributing Entities
Fire Relief Association ...................................................................................... 104
Notes to Required Supplementary Information .......................................................... 105
Supplementary Information:
Schedule of Revenues, Expenditures and Changes in Fund Balance
Budget and Actual General Fund ........................................................................... 108
Combining and Individual Fund Financial Statements and Schedules:
Combining Balance Sheet Nonmajor Governmental Funds .............................. 110
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances Nonmajor Governmental Funds ....................................................... 116
Combining Statement of Fund Net Position Internal Service Funds ................. 122
Combining Statement of Revenues, Expenses and Changes in Fund Net
Position Internal Service Funds ....................................................................... 123
Combining Statement of Cash Flows Internal Service Funds ........................... 124
Combined Statement of Fiduciary Net Position ................................................... 125
Statement of Changes in Assets and Liabilities Agency Fund ........................... 126
SECTION III
STATISTICAL SECTION
Net Position by Component .............................................................................................. 1 132
Changes in Net Position .................................................................................................... 2 134
Fund Balances Governmental Funds ............................................................................. 3 136
Changes in Fund Balances Governmental Funds .......................................................... 4 138
Tax Capacity and Estimated Actual Value of Taxable Property ...................................... 5 140
Direct and Overlapping Property Tax Rates ..................................................................... 6 141
Principal Taxpayers .......................................................................................................... 7 142
Property Tax Levies and Collections ................................................................................ 8 143
Ratio of Outstanding Debt by Type .................................................................................. 9 144
Ratio of General Bonded Outstanding .............................................................................. 10 145
Direct and Overlapping Governmental Activities Debt.................................................... 11 147
Legal Debt Margin Information ........................................................................................ 12 148
Pledged Revenue Coverage .............................................................................................. 13 150
Demographic and Economic Statistics ............................................................................. 14 151
Principal Employers .......................................................................................................... 15 153
Full-Time Equivalent City Government Employees by Function/Program ..................... 16 154
Operating Indicators by Function/Program ...................................................................... 17 156
Capital Asset Statistics by Function/Program................................................................... 18 158
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CITY OF SHAKOPEE
Administration
Bill Reynolds City Administrator
Assistant City
Nathan Burkett Administrator
Darin Nelson Finance Director
Jennifer Gabbard HR Manager
Andy Hutson IT Director
Lori Hensen City Clerk
Director of Planning &
Michael Kerski Development
Dave Kriesel Building Official
Jeff Tate Police Chief
Rick Coleman Fire Chief
Public Works
Bruce Loney Director/Engineer
Jamie Polley Park and Recreation Director
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CITY OF SHAKOPEE
ORGANIZATION CHART
DECEMBER 31, 2016
Electorate
City Council
City
Administrator
HR Division
Planning
Division
IT Division
Building
City Clerk Inspection
Division
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May 18, 2017
To the Honorable Mayor, Members of the City Council, and Citizens of the City of Shakopee:
The Comprehensive Annual Financial Report for the City of Shakopee, Minnesota, for the fiscal year
ended December 31, 2016, is submitted herewith:
Management assumes full responsibility for the completeness and reliability of the information contained
in this report, based upon a comprehensive framework of internal control that it has established for this
purpose. The costs of internal control should not exceed anticipated benefits and therefore the object is
to provide reasonable rather than absolute assurance that the financial statements are free from material
misstatement.
The City of Shakopees 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 year ended December 31, 2016, are fairly presented in
conformity with GAAP (generally accepted accounting principles). Based on the audit, the independent
auditor concluded that there was reasonable basis for rendering an unmodified (clean) opinion on the
citys financial statements for the year ended December 31, 2016. The independent audit involved
examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements;
assessing the accounting principles used; significant estimates made by management; as well as
evaluation of the overall financial statement presentation. The independent auditors report is presented
as the first component of the financial section of this report.
Management Discussion and Analysis (MD&A) immediately follows the independent auditors report
and provides a narrative introduction, overview, and analysis to accompany the basic financial
statements. This letter of transmittal is designed to complement the MD&A and should be read in
conjunction with it.
The City of Shakopee was incorporated for the second time in 1870 and is located approximately 25
miles southwest of Minneapolis. Bound by the Minnesota River on the north, Shakopee is in the
northern part of Scott County and is the county seat. In recent years, the city has been one of the most
rapidly growing communities in the state. The 2000 population of the city was 20,568 and the land area
covered is approximately 30 square miles. The 2010 census confirmed that the population had increased
to 37,076 and has been continuing to experience growth into the current year, with an estimated
population of 40,254, in 2016. The city comprises a unique blend of residential, commercial and
industrial properties, which provides a wide range of opportunities that are the result of the strong
economic health of the community and region. More than 80% of the community is developed, with
approximately 35% of the developed land as residential. The city levies a property tax on both real and
personal property located within its boundaries except for land owned or controlled by the Shakopee
Mdewakanton Sioux Community (SMSC), a federally recognized Native American Tribe. The city may
Shakopee is organized in Minnesota under Plan A, which includes a City Administrator, but the City
Council retains primary decision making authority such as policy setting, adopting ordinances and
budget and staffing. The City Council has four members who serve staggered terms of four years plus
the Mayor who serves a two-year term. All council positions are non-partisan, part-time and members
are elected at large. In 2019, the Mayors term will also become a four-year term.
The city provides typical municipal services such as police and fire protection, street and infrastructure
construction, public works maintenance, parks, recreation, planning and zoning. Also provided are
utilities such as sewer and storm drainage utilities, organized refuse collection, and recycling. Electric
and water utilities are operated by Shakopee Public Utilities Commission which is appointed by the
City Council but operates independently of the City of Shakopee.
Economic development and redevelopment are controlled by the Shakopee Economic Development
Authority (the Authority). The Authority is comprised of the Mayor and City Council members and is
included as an integral part of the citys report. The economic development activities of both staff and
Council continue to increase from past years, as the strong economic climate in the region has
provided the city with the benefit of planned commercial and industrial growth as well as expansion of
several existing businesses and commercial sites. 2016 activity has already confirmed that the
continuation of the growth trend will carry into the current year as the valuation of building permits for
the first quarter of 2017 was $35 million compared to a similar amount of $36 million for the same
timeframe in 2016.
The annual budget is the basis for the citys financial planning and control. The budget is prepared by
fund (e.g., General), function (e.g., Public Works) and division (e.g., Engineering). Major budget
requests or initiatives are submitted in July by Department Heads. The City Administrator reviews the
submittals with the Finance Director and Department Heads, to determine the prioritization of specific
budget requests. The City Council is presented with a proposed budget and a maximum tax levy in
September of each year. This information succinctly details changes in the upcoming year budget, such
as changes in personnel and position structure. It also includes funding requests that are unique to the
specific budget year, the basis for the request, as well as requests for transfers and internal funding needs,
such as internal service fund reviews. City Council is required to adopt a maximum tax levy by
September 30. The final tax levy and budget are adopted in December after a public meeting, which
provides the City Council and community impact information relating to both the budget decisions and
property tax levies. Final levy information is submitted to the County for inclusion in the development
of the upcoming year property tax statements. Budgeting control is provided by an annual budget
resolution passed by City Council. Formal control is at the division level and Council action is necessary
to change budgeted amounts between divisions and/or funds. The Finance Director or City
Administrator may make changes within divisions.
Along with the operating budget, the city annually prepares a five-year capital improvement plan (CIP)
that is the basis for the long term goal of providing and maintaining a functional public facility program,
that provides the residents and businesses with infrastructure necessary for the on-going growth and
development. The capital plans have historically provided details on the infrastructure projects that are
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funded through property tax levy, special assessments, utility funds and other intergovernmental revenue
sources. These projects primarily allow for the upgrades, expansion and coordination of transportation
based needs, as well as trails, signals and other infrastructure improvements. The City Council also
reviews and discusses the park planned improvements that are funded through the Park Reserve fund,
which provides for the use of park and community facilities that have historically been funded through
the collection of Park Dedication fees. The capital plans are reviewed with the Council and city staff,
and the funding sources and priorities developed for the annual and future budget practices.
A five-year major equipment list is also annually prepared and presented to Council. The funding for
this program is through the Internal Service fund rate charges, which are determined by departmental
use, replacement plans and determination of the remaining life. Internal Service funds are utilized for the
definition and application of other charges, including governmental buildings, park assets facilities, and
information technology. These charges are integrated into the individual budgets of the General fund and
departments that are benefitted by the activities of the programs. The Internal Service funds continue to
be reviewed and updated as the community needs and council directives are considered during each
budget cycle.
Local Economy
Shakopee is the county seat of Scott County, and it abuts the largest county in the region, Hennepin
County. Shakopee continues to benefit from its strategic location within the metropolitan region, as
well as its direct access to TH 169, which connects the city to other major regional roadways, the MSP
International Airport, and major employment centers. The city is also at the heart of regional
attractions which includes Valleyfair, Canterbury Park horse racing track, Mystic Lake and Little Six
casinos, and the Minnesota Renaissance Festival. These and other factors have propelled the city
through a period of strong and consistent growth that is likely to continue for years to come.
In 2016 and 2017, permits were issued for the construction of the following:
Marcus Theatres constructed a 54,000-square foot, ten screen movie theatre which opened in
April 2017.
Minnesota Municipal Power Agency (MMPA) constructed a 46-megawatt (MW) natural gas
powered electric plant. The plant went online in March of 2017.
Hy-Vee is constructing a 96,000-square foot grocery store along with an additional
convenience store and attached car wash. The grocery store is expected to open in the fall of
2017.
Apple Chrysler Jeep Dodge Ram constructed a new dealership building that opened in the
spring of 2017
The Shakopee School District is undertaking a major the expansion of the high school which
includes an additional 335,000-square feet of learning space. Completion is expected prior to
the beginning of the 2018-19 school year.
These projects are in addition to major projects that were issued building permits in 2015 and
completed construction in 2016. These major projects included:
Rahr Malting expansion
Amazon fulfillment center construction
Amerisource Bergan pharmaceutical distribution facility construction
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St. Francis Regional Medical Center expansion
Construction of a 55-unit senior assisted living facility near downtown
In addition, two major residential developments are in the works to break ground in the spring of 2017.
The first development is in the Ridge Creek addition, which will include 104 single family homes.
The second is the Windermere addition. This development is planned to be a mix of 197 residential
lots, seven commercial lots and multifamily housing.
Major Initiatives
The recent commercial, industrial and residential growth has required the city to maintain a commitment
to infrastructure plans, and integration with other local and regional projects. The City Council
committed funding in 2013 for a dedicated transfer of the property tax levy to fund a portion of the
planned capital improvements. The initial $500,000 commitment allows for street reconstruction and
overlays, and miscellaneous other construction projects. The 2014, 2015 and 2016 budgets provided
$750,000, $1.0 million and $1.2 million, respectively for continued and expanded capital improvement
funding. The 2017 budget continues with the commitment, dedicating $1,135,000 million towards
capital improvement funding through a combination of property and franchise taxes. This will provide
for a consistent funding source needed to address recently deferred infrastructure programs. The city
also continues to work with Scott County, the State of Minnesota (MnDOT), as well as private
developers, to allow for a strong coordination of project planning and benefits to the regions
transportation system and business climate.
Supporting retail opportunities, such as restaurants and small retail sites, are investigating locating in
Shakopee due to increased employee counts from the commercial ventures that have recently been built
in the community.
Scott County has historically dealt with a daily out-migration of workers who work in neighboring
counties. This issue is being addressed by decision makers, who want to utilize the skilled and educated
work force as an attraction to businesses. The commercial and industrial growth that the city has recently
and will continue to experience will eliminate some of the loss of daily work force from the area. By
seeking a solution to both transportation and employment issues, the residents of the Shakopee area will
be able to benefit by living and working close to home.
The citys community center and ice rink renovation broke ground April 1, 2016. This $30.4 million
project includes the construction of a new two-sheet arena, addition of an aquatic facility, and the
expansion of fitness, senior lounge, indoor playground, and child care areas. This project is being funded
through the issuance of tax abatement bonds. Project completion is scheduled for the summer of 2017.
The city is also constructing a 25,000-square foot City Hall that will be adjacent to the police station.
The City Hall addition will create a centralized city campus. Completion is anticipated to be in July
2017. The project cost is $8.5 million with financing from a mix of internal transfers and an interfund
loan.
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Long-Term Financial Planning
Historically, the city has issued only limited debt, in the form of bonds and internal funding for
planned infrastructure projects, expansion specific to streets, underground utilities, trails and sidewalk
expansion. A portion of the long term debt is funded by special assessments against benefited
properties. The city applies special assessments against benefitted properties at a rate of 30% of the
assessable project costs. This limited amount of special assessment revenue does require the city to
clearly define the other recognized components of the payment of project costs. The city does not
assess for overlays, which then requires funding from the tax levy or other regional revenues sources.
The City Council has recently allowed for the use of inter-fund transfers, use of existing fund balance
position, as well as review of charges and fees that may be applicable to the projects, and currently not
tapped for future funding sources.
In addition, the City Council passed an ordinance effective January 1, 2017 assessing the private gas
and electric utilities a franchise tax based on three percent of energy sales. This franchise tax is
estimated to generate $750,000 in 2017, with revenue dedicated to the Capital Improvement Fund.
City equipment needs are currently identified and funded in a manner that will not place an undue burden
or single year expense fluctuation on the taxpayers. The planned equipment replacement program clearly
identifies the equipment needs for current projects as well as future use. This is based on known and
anticipated programs and mandates, such as environmental program adjustments and possible
community expansion and growth. The capital and equipment needs of the city require constant
appraisal for replacement cost, life span and the assurance that the insurance coverage is providing for
the most comprehensive, yet affordable, coverage.
A self-insurance internal service fund was created in 2016 to aid in controlling insurance costs by
monitoring the premiums against deductible expenses. The long-term goal of the fund is to eventually
self-insure for non-catastrophic type of losses.
The citys target General Fund balance is to maintain an unassigned level between 40% and 45% of
expenditures. This level is to provide working capital for cash flow, expected declines in revenues,
and for unforeseen expenditures such as natural disasters, or for unforeseen but urgent requests.
Replenishing the fund balance when it falls below the target level shall be accomplished by inter-fund
transfers, or adjusting of expenditures or revenues, over a period not to exceed three years.
The city historically receives no local government aid (LGA). Annual legislative actions may impact
the financial position of those cities that are currently reliant on these and other government derived
revenue sources, which leaves them vulnerable to the economies of the State as a whole. As of this
writing, it was not anticipated that actions by the Minnesota Legislature would negatively impact the
city and its operations and planning. The standard budget process, which provides for the presentation
and approval of the property tax levies for the General fund (including Economic Development), debt
service and referendum debt, will be consistent with prior year actions.
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The accounting, auditing and financial reporting policies are designed to maintain a system of financial
monitoring, control and reporting for all operations and funds to provide effective means of ensuring
that overall city goals and objectives will be met and to assure the citys residents and investors that the
city is well managed and fiscally sound.
The investment policy provides for conservative investing, preserving capital and maintaining adequate
liquidity for forecasted cash needs. A third party investment manager handles the majority of the
portfolio and all investments are held in a trust account.
The debt policy ensures that the city's debt; 1) does not weaken the city's financial structure; and 2)
provides limits on debt to avoid problems in servicing debt. This policy is critical for maintaining the
best possible credit rating.
Capital policies include having expenditures forecasted ahead for five to ten years and are updated
annually. Internal Service Funds for major equipment, major buildings and facilities, park asset
replacement and information technology costs stabilize the annual impact of those items to the General
fund.
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 Shakopee for its
Comprehensive Annual Financial Report (CAFR) for the fiscal year ended December 31, 2015. This
was the 31st consecutive year that the city has received this award. In order to be awarded a Certificate
of Achievement, a government must publish an easily readable and efficiently organized CAFR. This
report satisfied both GAAP and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe our current CAFR
continues to meet the Certificate of Achievement Programs requirements and we are submitting it to
the GFOA to determine its eligibility for another certificate.
The preparation of this report would not have been possible without the efficient and dedicated
services of the Finance Department, Accounting Manager Melissa Schlingman, and the entire city
staff. We express appreciation to those staff members who assisted and contributed to the preparation
of this report. Credit also must be given to the Mayor and City Councilors for their support in
maintaining the highest standards of professionalism in the management of the City of Shakopees
finances.
Respectfully submitted,
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(D
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Shakopee
Minnesota
December 3L,20Ls
&/trZfu-
Executive Director/CEO
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Independent Auditors Report
Auditors Responsibility
Our responsibility is to express opinions on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the
United States of America and the standards applicable to financial audits contained in
Government Auditing Standards, issued by the Comptroller General of the United States.
Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free from material misstatement.
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. BerganKDV, Ltd.
bergankdv.com
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Auditors Responsibility (Continued)
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 first paragraph present fairly, in all
material respects, the respective financial position of the governmental activities, the
business-type activities, the aggregate discretely presented component units, each major
fund and the aggregate remaining fund information of the City of Shakopee, Minnesota, as
of December 31, 2016, and the respective changes in financial position and, where
applicable, cash flows thereof and the budgetary comparison for the General Fund for the
year then ended in accordance with accounting principles generally accepted in the United
States of America.
Other Matters
Accounting principles generally accepted in the United States of America require that the
Managements Discussion and Analysis, which follows this letter, and Required
Supplementary Information, as listed 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 managements 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.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements
that collectively comprise the City of Shakopees basic financial statements. The
introductory section, supplementary information and statistical section, are presented for
purposes of additional analysis, and are not a required part of the basic financial statements.
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Other Matters (Continued)
The supplementary information is the responsibility of management and was derived from
and relates 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 supplementary information is
fairly stated, in all material respects, in relation to the basic financial statements as a whole.
The introductory and statistical sections 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 it.
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CITY OF SHAKOPEE
As management of the City of Shakopee (the City), we offer readers of the Citys financial statements
this narrative overview and analysis of the financial activities of the City for the year ended
December 31, 2016. We encourage readers to consider the information presented here in conjunction
with additional information that we have furnished in our Letter of Transmittal, which can be found on
pages 3 to 8 of this report.
Financial Highlights
The assets of the City exceeded its liabilities at the close of the most recent year by $ 245.3
million (net position). Of this amount, $ 40.0 million (unrestricted net position) may be used to
meet the Citys ongoing obligations to citizens and creditors.
The Citys total net position decreased $ 1,988,045.
As of the close of the current year, the Citys governmental funds reported combined ending
fund balances of $ 30,666,344, increasing from the prior year. Approximately 34.9% of this total
amount, $ 10.7 million is available for spending at the Citys discretion (unassigned fund
balance).
At the end of the current year, unassigned fund balance for the General Fund was $ 10.7 million,
or 49.0 %, of total General Fund 2016 expenditures and 44.3% of the 2017 budgeted
expenditures.
The Citys total bonded debt increased $ 27.8 million.
This discussion and analysis are intended to serve as an introduction to the Citys basic financial
statements. The Citys basic financial statements comprise three components: 1) government-wide
financial statements, 2) fund financial statements, and 3) Notes to the Financial Statements. This report
also contains other supplementary information in addition to the basic financial statements themselves.
The government-wide financial statements are designed to provide readers with a broad overview of the
Citys finances, in a manner similar to private-sector business.
The Statement of Net Position presents information on all of the Citys assets and deferred outflows of
resources and liabilities and deferred inflows of resources, with the difference between them 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 Citys net position changed during
the most recent 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 employee leaves).
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,
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CITY OF SHAKOPEE
highways and streets, economic development and recreation. The business-type activities of the City
include sewer, storm drainage utilities and refuse.
The government-wide financial statements include not only the City itself (known as the primary
government), but also two legally separate entities for which the City is financially accountable. The
component units are Shakopee Public Utilities Commission (SPUC) and the Economic Development
Authority (EDA). SPUCs financial information is reported separately from the financial information
presented for the primary government as a discretely presented component unit. The EDA, which
functions like a department of the City although it is a legally separate entity, is presented within the
Citys government-wide financial statements. The City Council is the EDA Board.
The government-wide financial statements can be found on pages 28 and 29 of this report.
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: governmental funds, proprietary funds and
fiduciary funds.
Government Funds
Government 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 on balances of spendable resources available at the end of the year. Such
information may be useful in evaluating a Citys near-term financings 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 Citys near-term financing
decisions. The governmental funds Balance Sheet and the governmental funds 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 29 individual governmental funds. Information is presented separately in the
governmental funds Balance Sheet and in the governmental funds Statement of Revenues, Expenditures
and Changes in Fund Balances for the General Fund, the Capital Improvements and Community Center
and Ice Arena Capital Project Funds. Those are considered to be major funds. Data from the other
governmental funds are combined into a single, aggregated presentation. Individual fund data for each
of these non-major governmental funds is provided in the form of combining statements elsewhere in
this report.
The City adopts an annual appropriated budget for its General Fund. A budgetary comparison statement
has been prepared for the fund to demonstrate compliance with the budget.
The basic governmental funds financial statements can be found on pages 30 to 35 of this report.
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CITY OF SHAKOPEE
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 sewer, storm drainage and refuse operations. Internal
service funds are an accounting device used to accumulate and allocate costs internally among the Citys
various functions. The City uses internal service funds to account for its fleet of vehicles and mobile
equipment, its major buildings, the replacement of park assets, information technology items, insurance
funding and for employee compensated absences. All of these services predominantly benefit
governmental rather than business-type functions.
Proprietary funds provide the same type of information as the government-wide financial statements.
The proprietary fund financial statements provide separate information for the sewer, storm drainage and
refuse operations, all of which are considered to be major funds of the City. Conversely, all internal
service funds are combined into a single, aggregated presentation in the proprietary fund financial
statements. Individual fund data for the internal service funds is provided in the form of combining
statements elsewhere in this report.
The basic proprietary fund financial statements can be found on pages 36 to 39 of this report.
Component Units
Component units are legally separate organizations for which the City is financially accountable. The
government-wide financial statements present information for the component units in a single column
on the Statement of Net Position. Also, some information on the Statement of Changes in Net Position
is aggregated for component units. The component units Statements of Net Position and Statement of
Changes in Net Position provide detail for each major component unit.
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 statement because the resources of
those funds are not available to support the Citys own programs.
The basic fiduciary fund financial statements can be found on page 41 of this report.
The notes provide additional information that is essential to a full understanding of the data provided in
the government-wide and fund financial statements. The Notes to the Financial Statements can be found
on pages 45 to 94 of this report.
Other Information
In addition to the basic financial statements and accompanying notes, this report also presents certain
required supplementary information concerning the Citys progress in funding its obligation to provide
pension benefits to its employees.
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CITY OF SHAKOPEE
The combining statements referred to earlier in connection with non-major governmental funds, internal
service funds and fiduciary funds are presented immediately following the required supplementary
information on pensions. Combining and individual fund statements and schedules can be found on
pages 110 to 127 of this report.
As noted earlier, net position may serve over time as a useful indicator of a Citys financial position.
For the City, assets exceeded liabilities by $ 245.3 million at the close of the most recent year.
By far the largest portion of the Citys net position (81.0%) reflects its investment in capital assets (e.g.,
land, buildings and equipment); less any related debt used to acquire those assets that is still outstanding.
The City used these capital assets to provide services to citizens; consequently, these assets are not
available for future spending. Although the Citys 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.
Net Position
(Expressed in Thousands)
Governmental Activities Business-Type Activities Total
2016 2015 2016 2015 2016 2015
Current and Other Assets $ 56,638 $ 46,317 $ 23,992 $ 27,526 $ 80,630 $ 73,843
Capital Assets 155,754 129,046 70,099 68,986 225,853 198,032
Long-Term Liabilities
Outstanding $ 65,120 $ 18,776 $ 589 $ 419 $ 65,709 $ 19,195
Other Liabilities 9,795 5,224 268 1,132 10,063 6,356
NET POSITION:
Net Investment in Capital Assets $ 128,560 $ 120,831 $ 70,099 $ 68,986 $ 198,659 $ 189,817
Restricted 6,637 7,547 - - 6,637 7,547
Unrestricted 16,720 23,939 23,282 25,982 40,002 49,921
An additional portion of the Citys net position (2.7%) represents resources that are subject to external
restrictions on how they may be used. The remaining balance of unrestricted net position ($ 40.0
million) may be used to meet the Citys ongoing obligations to citizens and creditors.
At the end of the current year, the City was able to report positive balances in all three categories of net
position, both for the government as a whole, as well as for its separate governmental and business-type
activities. The same situation held true for the prior year.
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CITY OF SHAKOPEE
During the current year, the Citys net position decreased $ 2.0 million. Governmental activities
decreased as a result of additional bituminous overlay projects during 2016. The business-type activities
decreased as a result of expenses exceeding revenues during the year. Expenses also increased due to
increased fees from Met Council and increased storm costs related to cost sharing agreements.
Increased utility rates are still not covering operational expenses. In addition, the business type
activities transferred funds to governmental fund for operations and construction resulting in an overall
decrease in net position.
EXPENSES:
General Government 4,206 4,238 - - 4,206 4,238
Public Safety 13,281 10,582 - - 13,281 10,582
Public Works 8,594 8,552 - - 8,594 8,552
Culture and Recreation 4,653 4,355 - - 4,653 4,355
Economic Development 2,105 2,604 - - 2,105 2,604
Interest on Long-Term Debt 1,191 275 - - 1,191 275
Sewer - - 3,843 3,824 3,843 3,824
Storm - - 1,849 1,726 1,849 1,726
Refuse - - 127 128 127 128
Total Expenses 34,030 30,606 5,819 5,678 39,849 36,284
NET POSTION:
January 1 152,317 160,386 94,968 96,317 247,285 256,703
Change in Accounting Principles - (7,244) - (307) - (7,551)
January 1 As Restated* 152,317 153,142 94,968 96,010 247,285 249,152
December 31 $ 151,917 $ 152,317 $ 93,381 $ 94,968 $ 245,298 $ 247,285
*GASB Statement No. 68 was implemented for the year ended December 31, 2015 and required a
$ 7,244,500 and $ 306,917 restatement of beginning net position for governmental activities and
business type activities, respectively.
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CITY OF SHAKOPEE
Governmental Activities
Governmental activities decreased the Citys net position by $ 400,905. The major decrease was due to
additional bituminous overlay projects during 2016. These projects are considered maintenance and are
not capitalized.
$14,000,000
$12,000,000
$10,000,000
$6,000,000 Expenses
$4,000,000
$2,000,000
$-
Public works
Government
Public Safety
Recreation
Development
Interest on Long
Economic
General
Term Debt
Capital Grants
and
Contributions
Other Taxes 7%
1%
Property Taxes
56%
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CITY OF SHAKOPEE
Business-Type Activities
Business-type activities decreased the Citys net position by $ 1,587,140. Revenues and expenses both
increased between the current and prior year however overall expenses exceeded revenues as the
revenue collected for sewer services does not cover the payments made to suppliers. Additionally,
Business type activities transferred $1,271,853 to the governmental funds for operational and
construction expenses. The sewer and storm water activities will continue to experience a higher degree
of expense, as the deferral of maintenance and increasing mandates will continue to put pressure on the
funds, to meet the demands of on-going and future development needs.
$3,500,000
$3,000,000
$2,500,000
Program
$2,000,000 Revenues
Expenses
$1,500,000
$1,000,000
$500,000
$-
Sewer Storm Refuse
Capital Grants
and
Contributions
3%
Investment
Earnings
5% Charges for
Services
92%
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-
related legal requirements.
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CITY OF SHAKOPEE
Governmental Funds
The focus of the Citys governmental funds is to provide information on near-term inflows, outflows and
balances of spendable resources. Such information is useful in assessing the Citys financing
requirements. In particular, assigned and unassigned fund balance may serve as a useful measure of a
Citys net resources available for spending at the end of the year.
As of the end of the current year, the Citys governmental funds reported combined ending fund
balances of $30,666,344, an increase of $9,164,952 in comparison with the prior year. Approximately
34.9%, ($10,699,250), of the total amount constitutes unassigned fund balance, which is available for
spending at the Citys discretion. Approximately 23.0%, ($7,059,661), of the total amount constitutes
assigned fund balance, which is assigned for designated purposes. The remainder of fund balance,
($12,907,433), is not available for new spending because it has already been restricted or is
non-spendable.
The General Fund is the chief operating fund of the City. At the end of the current year, fund balance of
the General Fund was $ 10,761,366. As a measure of the General Funds liquidity, it may be useful to
compare fund balance (unassigned) to total fund expenditures. Unassigned fund balance represents
49.0% of total General Fund expenditures.
Fund balance of the Citys General Fund increased by $ 921,256 during the current year. Key factors in
this increase consist of the following:
Before transfers, the fund balance of the General Fund showed a $ 4,010,877 increase. After the
net transfer out of $ 3,098,755, fund balance increased $ 921,256. Transfers provided the
necessary funding for several significant capital infrastructure programs and projects, payment of
some debt service funds, economic development operations as well as funding insurance.
Overall revenues increased approximately $ 1,596,205 as a result of increased property taxes.
Licenses and permits increased due to increased growth and development during the year.
Charges for services increased due to additional contracted services being performed in 2016 as
well as increased community center usage. Miscellaneous revenue decreased as a result of
insurance moving to a new internal service fund. The City typically receives property and
liability insurance dividends each year, which is now being redirected toward the new self-
insurance internal service fund to match revenues with expenses.
Overall expenditures increased approximately $ 852,000 due to cost of living increases and new
positions added in 2016 as well as filling many open positions that were open at the end of 2015.
Fund balance of the Capital Improvements fund decreased $ 1,385,919. The decrease was attributed to
projects being completed that were funded with special assessment and tax increment which will be
received in future years. The City paid for the following projects in 2016 from this fund:
Street Reconstruction Projects
Bituminous Overlay
4th Avenue Reconstruction
Bituminous Reclaimation
Fund balance of the Community Center and Ice Arena fund increased $ 8,223,533. This project began
in 2015 with design work only. In 2016 bond proceeds of approximately $28 million were received to
fund this project. As of December 31, 2016, approximately $22 million has been completed. The
remodel of the community center and the creation of the new indoor pool is still under construction.
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CITY OF SHAKOPEE
Fund balance of the Non-major Governmental Funds increased $ 1,406,082. Major changes are as
follows:
Economic Development special revenue fund increased $829,007 due to the downtown
redevelopment project not being completed in 2016 as well as revaluing the land held for resale
back to cost.
Debt service funds increased $ 627,427 due to regular bond payments offset by bond proceeds,
tax levies and assessment revenue related to the bonds. Bond proceeds were received on the
2016A Tax Abatement Bond to pay the first 2 interest payments.
Park Reserve decreased $789,587. Quarry Lake Park project that took place during the year
along with the completion of Southbridge Community Park and Taphah West baseball fields.
City Hall increased $732,502 as a result of transfers from the General fund, Building internal
service fund and Sewer and Storm Drainage fund to fund the construction of a new city hall.
Proprietary funds
The Citys proprietary funds provide the same type of information found in the government-wide
financial statements, but in more detail.
Storm
Sewer Drainage Refuse
The City has undertaken several new development projects and continues to review fees charged to make
sure costs are covering operations of the funds. The capital assets of the projects will increase the capital
assets of these funds, as well as the offsetting future year depreciation charges. A portion of these projects
are funded through special assessments, but a significant portion of this is funded through the anticipated
future revenues collected for services. The Refuse fund was created during 2014 with the Citys purchase
of garbage carts. The negative net position is anticipated to be reduced each year as service charges
continue to be collected from customers.
Budget amendments of $902,710 between original and final amended budget were approved during
2016. Following are the main components of the amendments:
Revenues were increased $1,032,777 as a result of increased licenses and permits, increased
contracted services in public safety and additional state grants for maintenance and pension.
Expenditures were reduced $1,114,333. Wages and benefits were reduced approximately
$426,000 due to unfilled positions during 2016. Additionally, budgets were reduced for
pavement preservation, motor fuel and contracted services for reductions in spending in 2016.
Transfers out were increased $1,245,000 to help fund insurance, make future debt service
payments and partially fund the city hall construction.
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CITY OF SHAKOPEE
Actual expenditures of $21,916,614 were $203,924 over budget. The variances are noted below:
General government was under budget as a result of not spending contingency funds. Various
staff members wage distributions were not adjusted to reflect actual distribution resulting in
administration being over budget. Finance was over budget due to lodging tax coming in over
budget. Lodging tax is a budget neutral expenditure since we disburse what the city receives so
the variance is also noted in revenues. Compensated absences are not budgeted, actual was
approximately $53,000.
Public safety was over budget due to the implementation of an electronic review system, Project
Docs, resulting in approximately $95,000 in expenditures. Compensated absences are not
budgeted, actual was approximately $110,300.
Public works was over budget due to street light change outs on Southbridge Parkway of
approximately $53,000 was added when sealcoating was completed. Fleet implemented a new
management system for tracking vehicles for approximately $26,000. Compensated absences are
not budgeted, actual was approximately $39,700.
Park and recreation actual was consistent with the budget. Compensated absences are not
budgeted, actual was approximately $28,300.
Actual revenues of $25,927,491 were $666,691 over budget. The variances are noted below:
Property taxes came in under budget as a result of tax abatements paid to 3 companies during
2016. Tax abatements are a reduction in the property taxes received by the city. Also, lodging
tax come in over budget as noted above.
Licenses and permits came in over budget as a result of an increases in development and building
and conservative budgeting.
Intergovernmental revenue came in over budget due to additional police aid and PERA aid
related to pensions.
Charges for services come in over budget due to increased community center admissions and
memberships as well as additional contracted police services during 2016. Additionally,
engineering and grading fees were over budget because of the increased development.
Capital Assets
The Citys investment in capital assets for its governmental and business type activities as of
December 31, 2016, amounts to $225,853,229 (net of accumulated depreciation). This investment in
capital assets includes land, buildings and systems, improvement, machinery and equipment, park
facilities, roads, highways and bridges.
Major capital assets events during the current year included the following:
Purchase of 2 zambonies
New two sheet ice arena and community center remodel as well as furnishings in both buildings
Quarry Lake Park phase I construction and a new pedestrian bridge on quarry lake trail
Reconstruction of streets, sanitary sewer, storm sewer and water mains and bituminous
reclaimation projects on 4th Avenue, Hilldale Drive, 3rd Avenue, Market Street, Marcia Lane,
Eagle Creek, Mckenna Road, County Highway 16, 7th Street, Shumway Street, St Marks Street,
Minnesota Street, Shumway Street, and Shenandoah Drive.
Vehicle replacements in police, fire, streets and parks
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CITY OF SHAKOPEE
Additional information on the Citys capital assets can be found in Note 6 on pages 64 to 66 of this
report.
CAPITAL ASSETS
(Net of Depreciation)
Expressed in Thousands
In 2016, several projects that were in progress were continued and completed, as these projects often
involved the coordination with County, State and Federal entities. The status of these projects is highly
dependent on weather and the funding and staffing of cooperating entities, and will often impact the
ability of the City to complete these projects in the anticipated year.
Long-Term Debt
At the end of the current year, the City had total bonded debt outstanding of $ 36,030,000. Of this
amount, $ 33,935,000 comprises debt backed by the full faith and credit of the government and
$ 2,095,000 is special assessment debt for which the government is liable in the event of default by the
property owners subject to the assessment.
Outstanding Debt
G.O. and Revenue Bonds
Expressed in Thousands
Governmental Activities
2016 2015
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CITY OF SHAKOPEE
The Citys total bonded debt increased by $ 27,815,000 during the current year. The 2016A Tax
Abatement bond was issued in 2016 for $29,500,000 to fund the community center remodel and ice
arena construction. Additionally, another year of payments were made on all outstanding bonds totaling
$1,685,000.
Minnesota Statutes limit the amount of general obligation (G.O.) debt a government entity may issue to
a net figure of 3% of the taxable market value. The current legal debt margin for the City is $83 million,
which is significantly in excess of the Citys outstanding G.O. debt.
Additional information on the Citys long-term debt can be found in Note 7 on pages 66 to 69 of this
report.
The City is currently experiencing the construction and development of several new commercial
business sites. These companies such as Marcus Theatres, Minnesota Municipal Power Agency, Hy-
Vee and Apple Chrysler Jeep Dodge Ram are expanding and enhancing the economic tax base as well as
the employment options in the community. These business ventures will bring not only a strong base of
varied jobs to the area but enhanced tax base for the recently developed commercial and industrial sites.
The City is also experiencing growth in residential developments with the addition of two developments
in 2017.
During the current year, the unassigned fund balance in the General Fund was $10,739,178. This can be
similarly compared to the unassigned fund balance of 2015 of $9,818,537. The City continues to
maintain a strong financial position as the economic climate and the economic diversification of the
region and the state continue to improve.
The general tax levy for 2017 is increased to $18,926,341, in comparison to the prior year amount of
$16,825,900. This levy was increase to provide needed funding for city positions, infrastructure needs
through the capital improvement fund and debt service levies. Historically only 30% of some of the
project costs are funded through special assessments which will require a firm commitment of the
Council to provide needed resources for maintenance, improvements and additions to the existing
infrastructure.
City staff continues to refine and coordinate multi-department development related activities. This is
done through review of fees, charges, consistent practices and detailed discussions specific to each
development review. As staff continues to refine these practices the achieved outcome will be to
provide a higher level of positive customer and development satisfaction.
This financial report is designed to provide a general view of the Citys finances for all those with an
interest in the Citys finances. Questions concerning any of the information provided in this report or
requests for additional information should be addressed to the Finance Director, 129 Holmes St. S.,
Shakopee, Minnesota, 55379.
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BASIC FINANCIAL STATEMENTS
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CITY OF SHAKOPEE
Governmental Business-Type
Activities Activities Total Component Unit
ASSETS AND DEFERRED OUTFLOWS OF RESOURCES
Assets
Cash and Investments (Including Cash Equivalents) $ 48,102,133 $ 23,095,073 $ 71,197,206 $ 36,630,116
Restricted Cash and Investments - - - 13,403,450
Property Tax Receivable 76,631 - 76,631 -
Accounts Receivable (Net of Allowance for
Uncollectible Accounts) 501,242 22,000 523,242 4,114,344
Interest Receivable 191,437 106,042 297,479 46,511
Due From Other Governments 593,611 500,462 1,094,073 121,604
Special Assessments Receivable 4,826,856 268,188 5,095,044 -
Inventories - - - 1,173,161
Prepaid Expenses 205,804 - 205,804 52,000
Land Held for Resale 1,023,612 - 1,023,612 -
Net Pension Asset 1,117,106 - 1,117,106 -
Capital Assets, Net of Accumulated
Depreciation (Where Applicable):
Land and Land Improvements 21,004,655 3,796,803 24,801,458 5,097,532
Right of Way 253,904 507,746 761,650 -
Construction in Progress 29,933,034 58,296 29,991,330 8,268,479
Line Rights - 792,008 792,008 -
Infrastructure 69,308,222 63,014,542 132,322,764 -
Plant in Service - - - 71,712,938
Buildings 24,665,239 - 24,665,239 -
Machinery and Equipment 10,588,887 1,929,893 12,518,780 -
Total Assets and Deferred Outflows of Resources $ 229,802,603 $ 94,290,076 $ 324,092,679 $ 142,985,487
Total Liabilities and Deferred Inflows of Resources $ 77,885,925 $ 909,305 $ 78,795,230 $ 23,732,542
Net Position
Net Investment in Capital Assets 128,559,527 70,099,288 198,658,815 77,072,547
Restricted for:
Economic Development 1,503,917 - 1,503,917 -
Cable PEG Fees 70,795 - 70,795 -
Forfeiture 186,965 - 186,965 -
Debt Service 4,875,714 - 4,875,714 -
Component Units - - - 10,915,924
Unrestricted 16,719,760 23,281,483 40,001,243 31,264,474
The Notes to the Financial Statements are an integral part of this statement. 28
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CITY OF SHAKOPEE
STATEMENT OF ACTIVITIES
For the Year Ended December 31, 2016
Business-Type Activities
Sewer 3,843,232 3,292,166 - 183,142 - (367,924) (367,924) -
Storm Drainage 1,848,768 1,632,218 - - - (216,550) (216,550) -
Refuse 127,034 105,309 - - - (21,725) (21,725) -
Page 81 of 334
Total Business-Type Activities 5,819,034 5,029,693 - 183,142 - (606,199) (606,199) -
Total Primary Government $ 39,849,379 $ 13,396,184 $ 2,777,982 $ 2,370,181 (20,698,833) (606,199) (21,305,032) -
General Revenues
Property Taxes 18,015,507 - 18,015,507 -
Tax Increments 464,632 - 464,632 -
Unrestricted Investment Earnings 495,804 289,001 784,805 205,682
Gain on Sale of Asset 50,132 1,911 52,043 4,886
Transfers 1,271,853 (1,271,853) - -
Total General Revenues, Transfers and Special Items 20,297,928 (980,941) 19,316,987 210,568
Change in Net Position (400,905) (1,587,140) (1,988,045) 8,256,285
Net Position - Beginning 152,317,583 94,967,911 247,285,494 110,996,660
The Notes to the Financial Statements are an integral part of this statement.
29
CITY OF SHAKOPEE
Capital Projects
Fund Balances
Nonspendable 22,188 - - - 22,188
Restricted - - 6,547,457 6,337,788 12,885,245
Assigned - 4,744,275 - 2,315,386 7,059,661
Unassigned 10,739,178 - - (39,928) 10,699,250
Total Fund Balances 10,761,366 4,744,275 6,547,457 8,613,246 30,666,344
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CITY OF SHAKOPEE
Long-term assets from pensions reported in governmental activities are not financial resources
and therefore are not reported as assets in the funds. 1,117,106
Long-term liabilities, including bonds payable, are not due and payable in the current period and,
therefore, are not reported as liabilities in the funds.
Long-term liabilities at year-end consist of:
Bond Principal Payable (36,030,000)
Unamortized Bond Premium (2,135,590)
Net OPEB Obligation (1,591,366)
Net Pension Liability (25,879,138)
Delinquent property taxes and assessments receivable will be collected this year, but are
not available soon enough to pay for the current period's expenditures and, therefore,
are reported as unavailable revenue in the funds.
Property Taxes 76,631
Special Assessments 34,204
Deferred special assessments receivable are not available to pay for current expenditures and,
therefore, are reported as unavailable revenue in the funds.
Deferred Special Assessments 4,792,652
Governmental funds do not report a liability for accrued interest due and payable. (519,065)
The Notes to the Financial Statements are an integral part of this statement. 31
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CITY OF SHAKOPEE
Capital Projects
Community Other Total
Capital Center & Ice Governmental Governmental
General Fund Improvements Arena Funds Funds
REVENUES
Property Taxes $ 17,022,204 $ - $ - 1,062,630 $ 18,084,834
Tax Increment - - - 464,634 464,634
Special Assessments 15,818 830,701 - 768,642 1,615,161
Licenses and Permits 2,564,729 - - 582,089 3,146,818
Intergovernmental 1,344,279 1,039,329 192,645 1,043,557 3,619,810
Charges for Services 4,750,514 - - 8,730 4,759,244
Fines and Forfeitures 11,213 46,300 - 47,430 104,943
Miscellaneous 218,734 62,076 139,620 456,678 877,108
Total Revenues 25,927,491 1,978,406 332,265 4,434,390 32,672,552
EXPENDITURES
Current
General Government 3,999,953 - - 16,918 4,016,871
Public Safety 10,585,899 - - 57,443 10,643,342
Public Works 3,061,172 - - - 3,061,172
Culture and Recreation 4,232,167 - - 37,044 4,269,211
Economic Development - - - 2,092,337 2,092,337
Debt Service
Principal - - - 1,685,000 1,685,000
Interest and Other Charges - - 86,433 778,061 864,494
Capital Outlay 37,423 4,564,325 22,639,151 4,918,513 32,159,412
Total Expenditures 21,916,614 4,564,325 22,725,584 9,585,316 58,791,839
FUND BALANCES
Beginning of Year 9,840,110 6,130,194 (1,676,076) 7,207,164 21,501,392
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CITY OF SHAKOPEE
Interest on long-term debt in the Statement of Activities differs from the amount
reported in the governmental funds because interest is recognized as an expenditure
in the funds when it is due and thus requires use of current financial resources.
In the Statement of Activities, however, interest expense is recognized as
the interest accrues, regardless of when it is due. (428,467)
Governmental funds report the effects of bond premiums when debt is first issued, whereas these amounts
are deferred and amortized in the Statement of Activities 102,137
Proceeds from long-term debt are recognized as an other financing source in the
governmental funds but as a decrease in net assets in the Statement of Activities.
Bonds Payable (29,500,000)
Unamortized Bond Premium (2,237,727)
Certain revenues in the Statement of Activities that do not provide current financial
resources are not reported as revenues in the funds.
Special Assessments Delinquent 5,862
Special Assessments Deferred (493,348)
OPEB obligations are recognized when paid in the government funds but recognized
when incurred in the Statement of Activities (246,342)
Delinquent receivables will be collected this year, but are not available soon enough
to pay for the current period's expenditures and, therefore, are not revenues in the funds. (69,327)
Internal service funds are used by management to charge the costs of certain
activities such as buildings, equipment, park assets and employee benefits to
individual funds. (See Note 2.B.) (1,856,320)
The Notes to the Financial Statements are an integral part of this statement. 33
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CITY OF SHAKOPEE
EXPENDITURES
Current
General Government 4,686,001 4,096,290 3,999,953 (96,337)
Public Safety 10,374,766 10,357,100 10,585,899 228,799
Public Works 3,393,889 2,965,440 3,061,172 95,732
Parks and Recreation 4,370,867 4,233,860 4,232,167 (1,693)
Capital Outlay
Public Safety - 60,000 37,423 (22,577)
Park and Recreation 1,500 - - -
Total Expenditures 22,827,023 21,712,690 21,916,614 203,924
FUND BALANCES
Beginning of Year 9,840,110
The Notes to the Financial Statements are an integral part of this statement. 35
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CITY OF SHAKOPEE
Noncurrent Assets
Advances to Other Funds, Noncurrent 853,627 - - 853,627 1,341,394
Capital Assets:
Land 4,500 3,792,303 - 3,796,803 221,876
Right of Way - 507,746 - 507,746 -
Construction in Progress 35,990 22,306 - 58,296 401,288
Line Rights 1,368,569 - - 1,368,569 -
Infrastructure 43,791,973 43,514,667 - 87,306,640 3,617,493
Buildings - - - - 34,592,888
Machinery and Equipment 1,894,016 1,024,239 1,172,068 4,090,323 15,324,414
Total Cost 47,095,048 48,861,261 1,172,068 97,128,377 54,157,959
Less Accumulated Depreciation (13,697,024) (13,097,523) (234,542) (27,029,089) (21,066,962)
Net Capital Assets 33,398,024 35,763,738 937,526 70,099,288 33,090,997
Total Noncurrent Assets 34,251,651 35,763,738 937,526 70,952,915 34,432,391
Total Assets and Deferred Outflows of Resources $ 44,244,416 $ 49,698,829 $ 937,250 $ 94,880,495 $ 46,952,844
Noncurrent Liabilities
Advances from Other Funds - - 853,627 853,627 -
Compensated Absences 16,449 17,332 - 33,781 1,168,676
Net OPEB Obligation 38,654 38,654 - 77,308 -
Net Pension Liability 231,428 246,585 - 478,013 -
Total Noncurrent Liabilities 286,531 302,571 853,627 1,442,729 1,168,676
Total Liabilities 497,140 360,249 912,982 1,770,371 2,347,950
Net Position
Investment in Capital Assets 33,398,024 35,763,738 937,526 70,099,288 33,090,997
Unrestricted 10,324,117 13,548,061 (913,258) 22,958,920 11,513,897
Total Net Position 43,722,141 49,311,799 24,268 93,058,208 44,604,894
The Notes to the Financial Statements are an integral part of this statement. 36
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CITY OF SHAKOPEE
OPERATING EXPENSES
Salaries and Benefits 302,773 524,343 - 827,116 38,214
Depreciation 812,027 803,609 117,431 1,733,067 1,847,874
Professional Services 115,733 204,323 - 320,056 1,358
Sewer Disposal Charges 2,443,356 - - 2,443,356 -
Repairs and Maintenance 44,160 249,068 - 293,228 59,124
Materials and Supplies 35,784 53,041 - 88,825 379,138
Rent 38,530 40,179 - 78,709 -
Insurance 67,060 12,360 - 79,420 134,014
Utilities 79,297 1,916 - 81,213 -
Total Operating Expenses 3,938,720 1,888,839 117,431 5,944,990 2,459,722
NONOPERATING REVENUES
(EXPENSES)
Investment Income 122,703 167,402 (1,104) 289,001 155,581
Donations - - - - 366,622
Insurance Dividends - - - - 145,757
Interest Expense - - (9,603) (9,603) -
Gain (Loss) on Sale of Asset - 1,911 - 1,911 40,998
Capital Asset Transfer (7,966) (7,967) - (15,933) (52,907)
Trunk Charges 192,145 431,271 - 623,416 -
NET POSITION
Beginning of Year 44,701,736 50,032,074 47,097 94,780,907 46,325,655
The Notes to the Financial Statements are an integral part of this statement. 37
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CITY OF SHAKOPEE
Net Change in Cash and Cash Equivalents (1,990,972) (1,776,205) - (3,767,177) (965,287)
The Notes to the Financial Statements are an integral part of this statement. 38
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CITY OF SHAKOPEE
The Notes to the Financial Statements are an integral part of this statement. 39
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CITY OF SHAKOPEE
Total Agency
Funds
ASSETS
Current
Cash and Investments $ 3,156,064
Due from Other Governments 91,644
Prepaids 9,152
LIABILITIES
Accounts Payable $ 378,410
Deposits Payable 2,839,140
Due to Other Governments 39,310
The Notes to the Financial Statements are an integral part of this statement.
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CITY OF SHAKOPEE
Noncurrent Assets
Restricted Assets:
Customer Deposits Account 2,210,076 33,104 2,243,180
Connection Account - 10,526,340 10,526,340
Emergency Repairs Account 100,000 - 100,000
Capital Assets:
Plant in Service 62,220,987 53,985,582 116,206,569
Accumulated Depreciation (22,415,902) (16,980,197) (39,396,099)
Construction in Progress 6,586,352 1,682,127 8,268,479
Total Noncurrent Assets 48,701,513 49,246,956 97,948,469
Total Assets 84,743,775 55,876,360 140,620,135
Noncurrent Liabilities
Revenue Bonds 7,590,000 - 7,590,000
Unamortized Bond Discount (8,598) - (8,598)
Unearned Revenues 1,661,410 - 1,661,410
Customer Advances 259,511 50,801 310,312
Net Pension Liability 3,781,660 1,260,552 5,042,212
Total Noncurrent Liabilities 13,283,983 1,311,353 14,595,336
Total Liabilities 21,570,598 1,629,993 23,200,591
Net Position
Investment in Capital Assets 38,385,035 38,687,512 77,072,547
Restricted for Debt Service 389,584 - 389,584
Restricted for Connections & Reconstruction - 10,526,340 10,526,340
Unrestricted 25,830,085 5,434,389 31,264,474
Total Net Position 64,604,704 54,648,241 119,252,945
42
The Notes to the Financial Statements are an integral part of this statement.
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CITY OF SHAKOPEE
NET POSITION
Beginning of Year 58,924,667 52,071,993 110,996,660
43
The Notes to the Financial Statements are an integral part of this statement.
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CITY OF SHAKOPEE
A. Reporting Entity
The City of Shakopee is a statutory city governed by an elected mayor and four council members. The
accompanying financial statements present the government entities for which the government is
considered to be financially accountable.
The financial statements present the City and its component units. The City includes all funds,
organizations, institutions, agencies, departments and offices that are not legally separate from such.
Component units are legally separate organizations for which the elected officials of the City are
financially accountable and are included within the financial statements of the City because of the
significance of their operational or financial relationships with the City.
The City is considered financially accountable for a component unit if it appoints a voting majority of
the organizations governing body and it is able to impose its will on the organization by significantly
influencing the programs, projects, activities or level of services performed or provided by the
organization or there is a potential for the organization to provide specific financial benefits to or impose
specific financial burdens on, the City.
As a result of applying the component unit definition criteria above, certain organizations have been
defined and are presented in this report as follows:
Blended Component Unit Reported as if they were part of the City.
Discretely Presented Component Unit Entails reporting the component unit financial data in
statements separate from the financial date of the City.
Joint Ventures and Jointly Governed Organizations The relationship of the City with the entity is
disclosed.
For each of the categories above, the specific entities are identified as follows:
The Shakopee Economic Development Authority (EDA) was organized to promote development,
improve housing and reduce blighted areas in the City. It is included by reason of the City Council
having final approval for Shakopee EDA actions and the Shakopee EDA Board being comprised
entirely of City Council Members. City staff handles Shakopee EDA activity including Shakopee
EDA funds and the City approves Shakopee EDA tax levies and bonding activity. Therefore, the
City has financial oversight for Shakopee EDA activities. The City also has operational
responsibility of the EDA.
The activity of the Shakopee EDA is shown in the Shakopee EDA Special Revenue Fund in the
Citys financial statements. No separate financial statements for the Shakopee EDA are issued. For
any information desired beyond what is presented in this report, contact the Finance Director for the
City of Shakopee at 129 Holmes Street South, Shakopee, Minnesota 55379-1351.
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CITY OF SHAKOPEE
4. Other Organizations
The Shakopee Volunteer Fire Department Relief Association (the Association) is organized as a
nonprofit organization, legally separate from the City, by its members to provide pensions and other
benefits to such members in accordance with Minnesota Statutes. It is not a component unit of the City
because the Board of Directors is appointed by the membership of the Association and not by the City
Council. The financial oversight of the City is limited to approval authority for amending the
Association bylaws when the change results in an increase in the pension benefit level requiring an
increased City contribution. The Association has the authority to levy its own taxes for pensions and
deficits and would continue to exist for its members if the City was dissolved. Because the Association
is fiscally independent of the City, the financial statements of the Association have not been included
within the Citys reporting entity.
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CITY OF SHAKOPEE
The government-wide financial statements (i.e., the Statement of Net Position and the Statement of
Activities) report information on all of the nonfiduciary activities of the City. The fiduciary funds are
only reported in the Statement of Fiduciary Net Position at the fund financial statement level.
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 fees and charges
for support.
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. Interest on general long-term debt is considered an indirect expense and
is reported separately in the Statement of Activities. 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 and 2) grants and contributions that are restricted to meeting the operational
or capital requirements of a particular function or segment. Taxes and other items not properly
included among program revenues are reported instead as general revenues. Internally dedicated
revenues are reported as general revenues rather than program revenues.
Separate financial statements are provided for governmental funds and proprietary funds. Major
individual governmental funds and major individual enterprise funds are reported as separate columns in
the fund financial statements.
The Escrow Agency Fund is presented in the fiduciary fund financial statements. Since, by definition,
these assets are being held for the benefit of a third party (other local governments, private parties, etc.)
and cannot be used to address activities or obligations of the City, this Fund is not incorporated into the
government-wide statements.
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CITY OF SHAKOPEE
Refuse Fund This Fund accounts for operations associated with the Citys garbage carts and
recycling operations.
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CITY OF SHAKOPEE
Equipment Fund This Fund accounts for the Citys acquisition of larger pieces of equipment.
Buildings Fund This Fund accounts for the Citys funds accumulated for construction,
improvement or major repairs of major public buildings.
Park Assets Fund This Fund accounts for the Citys funds accumulated for the replacement of park
assets.
Employee Benefits Fund This Fund accounts for the Citys funds accumulated for compensated
absences and OPEB.
Information and Technology Fund This Fund accounts for the Citys funds accumulated for
information technology resources.
Self Insurance Fund This Fund is used to account for all revenues and expenses associated with
premiums, deductibles and claims for general liability and workers compensation policy through
LMCIT.
The Citys internal service funds are allocated between governmental and business-type activities and
are combined, as allocated in Note 2, with the respective governmental activities and business-type
activities in the government-wide financial statements.
Fiduciary Funds:
Escrow Agency Fund This Fund accounts for the monies held for specific purposes for individuals,
private organizations, other government units and other funds. Escrows are held on behalf of
builders and developers, for security deposits and police evidence deposits.
Holiday Lighting Agency Fund This Fund accounts for the monies held for holiday lighting.
Southwest Metro Drug Task Force Agency Fund This Fund accounts for the activity related to the
task force held by the City in a strictly custodial capacity.
Electric Fund This Fund accounts for the operations of the SPUCs electric utility.
Water Fund This Fund accounts for the operations of the SPUCs water utility.
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CITY OF SHAKOPEE
As a general rule, the effect of interfund activity has been eliminated from the government-wide
financial statements. Exceptions to this general rule are payments, where the amounts are reasonably
equivalent in value to the interfund services provided and other charges between the Citys utility
function and various other functions of the City. Elimination of these charges would distort the direct
costs and program revenues reported for the various functions concerned.
Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating
revenues and expenses generally result from providing services and producing and delivering goods in
connection with a proprietary funds principal ongoing operations. The principal operating revenues of
the enterprise funds are charges to customers for sales and services. Operating expenses for enterprise
funds include the cost of sales and services, administrative expenses and depreciation on capital assets.
All revenues and expenses not meeting this definition are reported as nonoperating revenues and
expenses.
When both restricted and unrestricted resources are available for use, it is the Citys policy to use
restricted resources first, then unrestricted resources as they are needed.
Cash and investments include balances from all funds that are combined and invested to the extent
available in various securities as authorized by state law. Earnings from the pooled investments are
allocated to the individual funds based on the average of month-end cash and investment balances.
All funds of the City are included in the pooled investments with the exclusion of the 2016A bond
proceeds which is included in the non-pooled investments.
The Citys cash and cash equivalents are considered to be cash on hand, demand deposits and highly
liquid debt instruments purchased with original maturities of three months or less from the date of
acquisition.
Certain investments for the City and Component Unit are reported at fair value as disclosed in Note
4. The City and Component Unit 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.
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CITY OF SHAKOPEE
Minnesota Statutes authorizes the City to invest in obligations of the U.S. Treasury, agencies and
instrumentalities, shares of investment companies whose only investments are in the aforementioned
securities, obligations of the State of Minnesota or its municipalities, bankers acceptances, future
contracts, repurchase and reverse repurchase agreements and commercial paper of the highest
quality with a maturity of no longer than 270 days and in the Minnesota Municipal Money Market
Fund.
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.
Activity between funds that are representative of lending/borrowing arrangements outstanding at the
end of the year are referred to as advances to/from other funds. All other outstanding balances
between funds are reported as due to/from other funds. Any residual balances outstanding
between the governmental activities and business-type activities are reported in the government-
wide financial statements as interfund balances.
All trade and property tax receivables are shown at a gross amount since both are assessable to the
property taxes and are collectible upon the sale of the property.
The City levies its property tax for the subsequent year during the month of December. December
28 is the last day the City can certify a tax levy to the County Auditor for collection the following
year. Such taxes become a lien on January 1 and are recorded as receivables by the City at that date.
The property tax is recorded as revenue when it becomes measurable and available. Scott County is
the collecting agency for the levy and remits the collections to the City three times a year. The tax
levy notice is mailed in March with the first half of the payment due on May 15 and the second half
due on October 15. Taxes not collected as of December 31 each year are shown as delinquent taxes
receivable.
The County Auditor prepares the tax list for all taxable property in the City, applying the applicable
tax rate to the tax capacity of individual properties, to arrive at the actual tax for each property. The
County Auditor also collects all special assessments, except for certain prepayments paid directly to
the City.
The County Auditor submits the list of taxes and special assessments to be collected on each parcel
of property to the County Treasurer in January of each year.
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Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as
prepaid items in both government-wide and fund financial statements. Prepaid expenditures of
governmental funds are reported using the consumption method and recorded as
expenditures/expenses at the time of consumption.
Inventories of enterprise funds are valued at average cost using the first in, first out (FIFO) method.
Inventory in the governmental funds are recorded as an expenditure when consumed rather than
when purchased.
Other assets include unamortized debt issuance costs, the Emergency Repairs Account and the asset
and related amortization relating to the Electric Plant Acquisition.
Land is acquired by the City for subsequent resale for redevelopment purposes. Land held for resale
is reported as an asset at the lower of cost or estimated realized value in the fund that acquired it.
5. Restricted Assets
Certain cash and investments in the component units are classified as restricted. The Electric Fund
has monies restricted for customer deposits and debt service. The Water Fund has monies restricted
for water production and trunk distribution facility acquisition, based on trunk and connection fees
collected from users, construction projects and debt service.
6. Capital Assets
Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads,
sidewalks and similar items), are reported in the applicable governmental or business-type activities
columns in the government-wide financial statements. Capital assets are defined by the City,
excluding the component unit, as assets with an initial, individual cost of more than $ 10,000 and an
estimated useful life in excess of two years. Capital assets for the component unit are defined as
assets with an initial, individual cost of more than $ 1,000 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 the asset or materially
extend assets lives are not capitalized.
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Property, plant and equipment of the City are depreciated using the straight-line method over the
following estimated useful lives.
Assets Years
Buildings 30-50
Park Buildings 30
Building Improvements 25
Light Vehicles 4-10
Machinery and Equipment 4-20
Utility Distribution System 50-75
Infrastructure 30-50
Fire Trucks 20-25
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. The City and Component Unit present deferred outflows of resources on the Statement
of Net Position for the deferred charge related to pensions. The Component Unit also has one item
that qualifies for reporting in this category. It is the deferred charge on refunding reported in the
statement of net position- component unit - SPUC. A deferred charge on refunding results from the
difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred
and amortized over the shorter of the life of the refunded or refunding debt. The City presents
deferred outflows of resources on the Statements of Net Position for deferred outflows of resources
related to pensions. Deferred outflows of resources related to pensions results from the net effect of
the change in proportionate share, the difference between projected and actual investments earnings
and employer contributions paid to PERA and the firefighters relief association subsequent to the
measurement date.
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, deferred inflows of resources, 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 only has one type of item, which arises only under the modified accrual basis of
accounting that qualifies for reporting in this category. Accordingly, the item is reported only in the
governmental funds balance sheet as unavailable revenue.
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The governmental funds report unavailable revenues from two sources: property taxes and special
assessments. These amounts are deferred and recognized as an inflow of resources in the period
that the amounts become available.
The City presents deferred inflows of resources on the Statements of Net Position for deferred
inflows of resources related to pensions. Deferred inflows of resources related to pensions results
from the net difference between projected and actual earnings on plan investments, changes in
proportionate share and the differences between expected and actual economic experience.
8. Compensated Absences
Vacation and sick leave benefits are recorded as expenditures in the Employee Benefits Internal
Service Fund and governmental funds when the obligations have matured and are expected to be
liquidated with expendable financial resources. City employees earn vacation time based on years
of City service. Employees who have 0 to 15 years of employment may accumulate no more than
240 hours. Employees who have 16 or more years of service may accumulate no more than 360
hours of vacation leave. Upon termination, employees will receive compensation for all unused
vacation. Employees earn sick leave and may accumulate to a maximum of 960 hours. The City
compensates employees who leave municipal service at the rate of 45% up to 15 years of service.
After 15 years of service, employees who leave are compensated at the rate of 55% plus 2% for
each year of service beyond 15 years up to 75% of unused sick leave.
9. Long-Term Obligations
In the government-wide financial statements and proprietary fund types in the fund financial
statements, long-term debt and other long-term obligations are reported as liabilities in the applicable
governmental activities, business-type activities or proprietary fund type Statement of Net Position.
Enterprise fund bond premiums and discounts, are deferred and amortized over the life of the bonds
using the effective interest method. Bonds payable are reported net of the applicable bond premium
or discount.
In the fund financial statements, governmental fund types recognize bond premiums and discounts,
as well as bond issuance costs, during the current period. The face amount of debt issued is reported
as other financing sources. Premiums received on debt issuances are reported as other financing
sources while discounts on debt issuances are reported as other financing uses. Issuance costs,
whether or not withheld from the actual debt proceeds received, are reported as expenditures.
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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 (PERA) and the relief association and additions to/deductions from PERA's and the
relief association's fiduciary net position have been determined on the same basis as they are
reported by PERA and the relief association 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.
a. Classification
In the fund financial statements, governmental funds report fund classifications that comprise a
hierarchy based primarily on the extent to which the City is bound to honor constraints on the
specific purpose for which amounts in those funds can be spent. Non-spendable fund balances
include amounts that cannot be spent because they are not in spendable form. Amounts that are
restricted to specific purposes either by a) constraints placed on the use of resources by creditors,
grantors, contributors, or laws or regulations of other governments or b) imposed by law through
enabling legislation are classified as restricted fund balances. Amounts that can only be used for
specific purposes pursuant to constraints imposed by the City Council (highest level of decision
making authority) through resolution are classified as committed fund balances. Amounts that
are constrained by the Citys intent to be used for specific purposes but are neither restricted nor
committed are classified as assigned fund balances. Assignments are made by the Citys Finance
Director based on the City Councils direction. Unassigned fund balance represents fund balance
that has not been assigned to other funds and that has not been restricted, committed or assigned
to a specific purpose in the General Fund. The Citys policy is to consider unrestricted fund
balance to be spent by City Council action, appropriations or emergency situations.
The City applies restricted resources first when expenditures are incurred for purposes for which
either restricted or unrestricted (committed, assigned and unassigned) are available. Similarly,
within unrestricted fund balance, committed amounts are reduced first followed by assigned and
then unassigned amounts when expenditures are incurred for purposes for which amounts in any
of the unrestricted fund balance classifications could be used.
a. Minimum Fund Balance
The Citys target General Fund balance is to maintain an unassigned level between 40%
(minimum) and 45% of budgeted expenditures. This level is to provide working capital for cash
flow, expected decline in revenues and unforeseen expenditures such as natural disasters.
Replenishing fund balance when it falls below the target level shall be accomplished by interfund
transfers or budgeting for expenditures and other uses to be less than revenues or other sources
over a period not to exceed three years.
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Net position represents the difference between assets and deferred outflows and liabilities and
deferred inflows in the government-wide financial statements. Net investment in capital assets
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 is reported as restricted in the
government-wide financial statement when there are limitations on their use through external
restrictions imposed by creditors, grantors or laws or regulations of other governments.
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.
A. Explanation of Certain Differences between the Governmental Fund Balance Sheet and the
Government-Wide Statement of Net Position
The governmental fund Balance Sheet includes reconciliation between fund balance total
governmental funds and net position governmental activities as reported in the government-wide
Statement of Net Position. One element of that reconciliation explains that Internal Service Funds are
used by management to charge the costs of providing certain services for the City.
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Another element of that reconciliation states that Internal Service Funds are used by management to
charge the costs of providing various services for the City. The details of this difference are as follows:
The proprietary fund Statement of Net Position includes reconciliation between net position total
enterprise funds and net position of business-type activities as reported in the government-wide
Statement of Net Position. The description of the sole reconciliation is adjustment to reflect the
consolidation of internal service fund activities related to enterprise funds. The details are as follows:
Another element of that reconciliation states that Internal Service Funds are used by management to
charge the costs of providing various services for the City. The details of this difference are as follows:
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A. Budgetary Information
Budgets are adopted on a basis consistent with accounting principles generally accepted in the United
States of America. Annually appropriated budgets are adopted for the General Fund.
Budgeted amounts present the originally adopted budget and final amended budget approved by the City
Council. The City does not use encumbrances. Budgeted expenditure appropriations lapse at year-end.
1. In August of each year, City staff submits to the City Council, a proposed operating budget for
the year commencing the following January 1. The operating budget includes proposed
expenditures and the means of financing them for the upcoming year.
3. The budget is legally enacted through passage of a resolution after obtaining taxpayer comments.
4. Expenditures may not legally exceed budgeted appropriations at the division level. The division
level expenditures are presented in the schedule of revenues, expenditures and changes in fund
balances budget and actual general fund. No funds budget can be increased without City
Council approval. The City Council may authorize transfer of budgeted amounts between
divisions within any fund. Management may amend budgets within a division level, so long as
the total division budget is not changed.
5. An annual budget is adopted for the General Fund. Annual appropriated budgets are not adopted
for Debt Service Funds because effective budgetary control is alternatively achieved through
bond indenture provisions. Budgetary control for Capital Projects Funds is accomplished
through the use of project controls and budgets are not adopted.
6. Budgeted amounts are as originally adopted and as amended by the City Council. Individual
amendments were not material in relation to the original amounts budgeted. Budgeted
expenditure appropriations lapse at year-end
NOTE 4 DEPOSITS AND INVESTMENTS
A. Deposits
In accordance with applicable Minnesota Statutes, the City and the Component Unit maintains deposits
at depository banks authorized by the City Council and the Commissioners.
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B. Investments
As of December 31, 2016, the City held the following investments:
Years to Maturity
Less than Moody's
Fair Value One Year 1-5 Years 5-10 Years 10-15 Years Concentration Rating
Pooled Investments:
Certificate of Deposit $ 5,493,668 $ 3,739,223 $ 1,754,445 $ - $ - 8.70% NR
Money Market Fund 103,326 103,326 - - - 0.16% NR
Mortgage
FFCB 1,202,772 1,202,772 - - - 1.91% AAA
FHLB 9,408,563 7,655,383 1,753,180 - - 14.91% AAA
FHLMC 4,634,419 501,981 2,202,998 272,740 1,656,700 7.35% AAA
FNMA 3,830,112 6,908 164,131 - 3,659,073 6.07% NR
Municipal Bond 13,279,434 1,957,720 9,383,789 1,937,925 - 21.05% AAA-AA3
US Treasury Notes 25,143,262 300,171 24,843,091 - - 39.85% AAA
Non-Pooled Investments:
Money Market Fund 2,636,185 2,636,185 - - - 24.05% NR
Mortgage
FHLB 681,020 681,020 - - - 6.21% AAA
FHLMC 5,892,460 5,892,460 - - - 53.75% AAA
FNMA 1,752,642 1,752,642 - - - 15.99% NR
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The Citys investment policy, which covers all funds except the component units, addresses the
following risks. The Citys component units also have a formal policy to address the following risks.
Credit Risk: This is the risk that an issuer or other counterparty to an investment will not fulfill its
obligation to the holder of the investment. Minnesota Statutes 118A.04 and 188A.05 limit investments
that are in the top two ratings issued by nationally recognized statistical rating organizations. The Citys
investment policy references Minnesota Statutes and further limits the types of investments that the City
is allowed to invest in. The Commissions policy states to ensure safety, it is the policy of the Shakopee
Public Utilities Commission that when Considering an investment, all depositories under consideration
be cross-checked against existing investments to make certain that funds in excess of insurance limits
are not made in the same institution unless collateralized as outlined below. Furthermore, the Shakopee
Public Utilities Commission will approve all financial institutions, brokers, and advisers with which the
Shakopee Public Utilities Commission will do business.
Custodial Credit Risk Investments: For an investment, this is the risk that in the event of the failure of
the counterparty, the City will not be able to recover the value of its investments or collateral securities
that are in the possession of an outside party. The Citys investment policy states all securities
purchased, including appropriate collateral, shall be placed with an independent third party for custodial
safekeeping. The Commissions policy states they will minimize risk by only purchasing investments
that are held in safekeeping with a Federal Reserve bank, United States Bank with corporate trust
powers, a primary reporting dealer to the Federal Reserve Bank of New York, or a broker dealer having
its principal executive office in Minnesota and that designated brokers have insurance through the SIPC
(Securities Investor Protection Corporation). As of December 31, 2016, all investments of the City and
the component units were insured, registered and held by the City or its agent and in the Citys name, or
by the SPUC and in the SPUCs name.
Interest Rate Risk: This is the risk that changes in market interest rates will adversely affect the fair
value of an investment. The Citys policy states the investment portfolio shall be designed with the
objective of attaining a market rate of return throughout budgetary and economic cycles, taking into
account the investment risk constraints and liquidity needs. To the extent possible, the City shall
attempt to match its investments in short-term operating funds with anticipated cash flow requirements.
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Concentration of Credit Risk: This is the risk of loss attributed to the magnitude of an investment in a
single issuer. According to the Citys investment policy, the aggregate investment portfolio shall be
diversified by:
Limiting investments to avoid over concentration in securities from a specific issuer or business
sector.
Limiting investments in securities that have higher credit risks.
Investing in securities with varying maturities.
Continuously investing a portion of the portfolio in readily available funds, such as Local
Government Investment Pools (LGIP), money market funds or repurchase agreements to ensure
appropriate liquidity is maintained in order to meet ongoing obligations.
Having all investments, other than those in direct obligations or agencies of the United States,
secured by collateral or repurchase agreements, shall not exceed 50% of the aggregate
investment portfolio. Mortgage backed securities shall not exceed 35% of the aggregate
investment portfolio, at the time of investment (i.e., commercial paper or bankers acceptance).
Limiting investments in any one corporation to 5% of the aggregate investment portfolio.
The Commissions policy states they will minimize risk by only purchasing investments that are held in
safekeeping with the Federal Reserve bank, United States Bank with corporate trust powers, a primary
reporting dealer to the Federal Reserve Bank of New York, or a broker dealer having its principal
executive office in Minnesota and that designated brokers have insurance through a SIPC (Securities
Investor Protection Corporation). As of December 31, 2016, the City held investments that exceeded 5%
of its total investments for all funds as noted in the table on the previous page. The component units
investments noted in the table above exceeded 5% of its total investments as of December 31, 2016.
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All of the Component Units investments at December 31, 2016 are valued using quoted market prices
(Level 1 inputs).
The following is a summary of total deposits and investments as of December 31, 2016:
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Less Accumulated
Depreciation for:
Buildings 12,683,403 891,372 50,599 13,524,176
Infrastructure 75,063,491 4,692,400 - 79,755,891
Machinery and Equipment 7,805,261 1,033,527 804,806 8,033,982
Total Accumulated
Depreciation 95,552,155 6,617,299 855,405 101,314,049
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Business-type capital asset activity for the year ended December 31, 2016 was as follows:
Beginning Ending
Balance Increases Decreases Balance
Business-Type Activities:
Capital Assets not being
Depreciated:
Land $ 3,796,803 $ - $ - $ 3,796,803
Right-Of-Way 447,746 60,000 - 507,746
Construction in Progress 211,774 58,296 211,774 58,296
Total Capital Assets
not being Depreciated 4,456,323 118,296 211,774 4,362,845
Less Accumulated
Depreciation for:
Line Rights 551,760 24,801 - 576,561
Plant in Service 22,911,452 1,380,646 - 24,292,098
Machinery and Equipment 1,839,522 327,620 6,712 2,160,430
Total Accumulated
Depreciation 25,302,734 1,733,067 6,712 27,029,089
Business-Type Activities:
Sanitary Sewer $ 812,027
Storm Drainage 803,609
Refuse 117,431
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Component unit capital asset activity for the year ended December 31, 2016 was as follows:
Beginning Ending
Balance Increases Decreases Balance
Component Unit Capital Assets
not being Depreciated:
Land and Land Rights $ 5,097,532 $ - $ - $ 5,097,532
Construction in Progress 8,274,803 7,843,214 7,849,538 8,268,479
Total Capital Assets
not being Depreciated 13,372,335 7,843,214 7,849,538 13,366,011
Component Units:
Electric $ 1,841,744
Water 1,199,571
The City issues general obligation (G.O.) bonds to provide for financing tax increment projects, street
improvements and construction of government buildings. Debt service is covered respectively by tax
increments and special assessments against benefited properties with any shortfalls being paid from
general taxes.
G.O. bonds are direct obligations and pledge the full faith and credit of the City. These bonds generally
are issued as serial bonds with equal debt service payments each year. G.O. bonds currently outstanding
are shown on the following page.
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B. Revenue Bonds
The Commission issues Revenue Bonds for electric and water activity. Debt service is covered through
the revenue producing activities of these funds.
Total Governmental
Activities $ 40,290,456 $ 2,641,190
Business-Type Activities
Compensated Absences $ 61,420 $ 27,639
Long-term bonded indebtedness listed above were issued to finance acquisition and construction of
capital facilities or to refinance (refund) previous bond issues. For the most part, the General Fund and
the Employee Benefits Internal Service Fund are typically used to liquidate governmental compensated
absences payable. The Sewer and Storm Drainage funds are typically used to liquidate business type
compensated absences payable.
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Business-Type Activities
Compensated Absences $ 54,438 $ 40,671 $ 33,689 $ 61,420 $ 27,639
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Conduit debt obligations are certain limited obligation revenue bonds or similar debt instruments issued
for the express purpose of providing capital financing for a specific third party. The City has issued
various revenue bonds to provide funding to private-sector entities for projects deemed to be in the
public interest. Although these bonds bear the name of the City, the City has no obligation for such debt
beyond the resources provided by related leases or loans. Accordingly, the bonds are not reported as
liabilities in the financial statements of the City.
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Total $ 64,463,901
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Total $ 67,157
The due from/due to other funds balance represents borrowing to eliminate a cash deficit. This will be
repaid as funds are available.
The composition of advance from/to other funds as of December 31, 2016 is as follows:
Total $ 2,195,021
The advance between the Sewer Fund and Refuse Fund represents a long term interfund loan which was
used to purchase garbage carts. This will be repaid over 10 years with revenue collected for cart usage
at rate of 1% interest. The advance between the Internal Service fund and Nonmajor Governmental
Fund represents a long term interfund loan which was used to recreate a Property Acquisition Fund.
This will be repaid over 10 years with proceeds from the sale of land or tax levy at rate of 0% interest.
The advance between the Internal Service fund and Economic Development Authority Fund represents a
long term interfund loan which was used to purchase land which will be resold. This will be repaid once
the parcels are sold or developed at rate of 0% interest.
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Transfer In Transfer O ut
Governmental F unds:
General F und (1) (2) (3) (4) (6) (8) (9) $ 250,000 $ 3,348,755
C apital Improvements (3) 1,200,000 -
O ther Governmental F unds (2) (4) (5) (6) (7) (9) 5,466,355 30,222
Total Governmental F unds 6,916,355 3,378,977
P roprietary F unds:
S ewer F und (1) (5) (6) - 630,920
S torm Drainage F und (1) (6) - 625,000
Total P roprietary F unds - 1,255,920
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The city participates in various pension plans. Total pension expense for the year ended December 31,
2016 was $4,481,742. The components of pension expense are noted in the following plan summaries.
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.
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 either the Coordinated Plan or the Basic Plan. Coordinated
Plan members are covered by Social Security and Basic Plan members are not. The Basic Plan was
closed to new members in 1967. All new members must participate in the Coordinated Plan.
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.
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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 and Basic Plan members. The retiring member receives the
higher of a step-rate benefit accrual formula (Method 1) or a level accrual formula (Method 2). Under
Method 1, the annuity accrual rate for a Basic Plan member is 2.2% of average salary for each of the
first ten years of service and 2.7% for each remaining year. The annuity accrual rate for a Coordinated
Plan member is 1.2% of average salary for each of the first ten years and 1.7% for each remaining year.
Under Method 2, the annuity accrual rate is 2.7% of average salary for Basic Plan members and 1.7%
for Coordinated Plan members for each year of service. For 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.
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.
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C. Contributions (Continued)
Basic Plan members and Coordinated Plan members were required to contribute 9.1% and 6.50%,
respectively, of their annual covered salary in calendar year 2016. The City was required to contribute
11.78% of pay for Basic Plan members and 7.50% for Coordinated Plan members in calendar year 2016.
The City's contributions to the General Employees Fund for the year ended December 31, 2016, was
$459,555. The City's contributions were equal to the required contributions as set by state statute. The
Commission's contributions to the General Employees Fund for the year ended December 31, 2016, was
$299,473. The Commission's contributions were equal to the required contributions as set by state
statute.
Plan members were required to contribute 10.8% of their annual covered salary in calendar year 2016.
The City was required to contribute 16.20% of pay for Police and Fire Fund members in calendar year
2016. The City's contributions to the Police and Fire Fund for the year ended December 31, 2016, were
$ 761,951. The City's contributions were equal to the required contributions as set by state statute.
D. Pension Costs
At December 31, 2016, the City reported a liability of $ 7,575,497 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 2016. 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 $ 98,919. The net pension liability was measured as of June 30, 2016,
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, 2015, through June 30, 2016, relative to the total employer contributions received from all of
PERA's participating employers. At June 30, 2016, the City's proportion share was 0.0933%, which was
an increase of 0.0003% from its proportion measured as of June 30, 2015.
For the year ended December 31, 2016, the City recognized pension expense of $ 1,002,782 for its
proportionate share of General Employees Fund's pension expense. In addition, the City recognized an
additional $ 29,495 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.
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At December 31, 2016, the City reported its proportionate share of the General Employees Plan's
deferred outflows of resources and deferred inflows of resources, and its contributions subsequent to the
measurement date, related to pensions from the sources as follows.
Deferred Deferred
Outflows of Inflows of
Resources Resources
$ 221,054 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, 2017. Other amounts reported as deferred outflows and
deferred inflows of resources related to pensions will be recognized in pension expense as follows:
2017 $ 550,574
2018 550,572
2019 735,511
2020 273,636
Total $ 2,110,293
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At December 31, 2016, the City reported a liability of $ 18,781,654 for its proportionate share of the
Police and Fire Fund's net pension liability. The net pension liability was measured as of June 30, 2016,
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, 2015, through June 30, 2016, relative to the total employer contributions received from all of
PERA's participating employers. At June 30, 2016, the City's proportion share was 0.4680 % which was
a decrease of 0.0040% from its proportion measured as of June 30, 2015.
For the year ended December 31, 2016, the City recognized pension expense of $ 3,269,763 for its
proportionate share of the Police and Fire Fund's pension expense. The City also recognized $ 42,120
for the year ended December 31, 2016, as pension expense (and grant revenue) 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.
At December 31, 2016, the City reported its proportionate share of the Police and Fire Fund's deferred
outflows of resources and deferred inflows of resources related to pensions from the following sources:
Deferred Deferred
Outflows of Inflows of
Resources Resources
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2017 $ 2,411,970
2018 2,411,970
2019 2,411,984
2020 2,180,345
2021 1,767,155
Total $ 11,183,424
At December 31, 2016, the Commission reported a liability of $ 5,042,212 for its proportionate share of
the General Employees Fund's net pension liability. The Commission's net pension liability reflected a
reduction due to the State of Minnesota's contribution of $6 million to the fund in 2016. 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 Commission totaled $ 65,842. The net pension liability was measured as of
June 30, 2016, and the total pension liability used to calculate the net pension liability was determined
by an actuarial valuation as of that date. The Commission's proportion of the net pension liability was
based on the Commission's contributions received by PERA during the measurement period for
employer payroll paid dates from July 1, 2015, through June 30, 2016, relative to the total employer
contributions received from all of PERA's participating employers. At June 30, 2016, the Commission's
proportion share was 0.0621%, which was an increase of 0.0013% from its proportion measured as of
June 30, 2015.
For the year ended December 31, 2016, the Commission recognized pension expense of $ 681,569 for
its proportionate share of General Employees Fund's pension expense. In addition, the Commission
recognized an additional $ 19,632 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, 2016, the Commission reported its proportionate share of General Employees Fund's
deferred outflows of resources and deferred inflows of resources, and its contributions subsequent to the
measurement date, from the following sources on the subsequent page.
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Deferred Deferred
Outflows of Inflows of
Resources Resources
$ 149,737 reported as deferred outflows of resources related to pensions resulting from Commission
contributions subsequent to the measurement date will be recognized as a reduction of the net pension
liability in the year ended December 31, 2017. Other amounts reported as deferred outflows and inflows
of resources related to pensions will be recognized in pension expense on the following page.
2017 $ 386,792
2018 386,792
2019 502,051
2020 182,130
Total $ 1,457,765
E. Actuarial Assumptions
The total pension liability in the June 30, 2016, actuarial valuation was determined using the entry age
normal actuarial cost method and the following actuarial assumptions:
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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 the General Employees Plan and RP-2000
tables for the Police and Fire Plan for males or females, as appropriate, with slight adjustments. Cost of
living benefit increases for retirees are assumed to be 1% for all future years for the General Employees
Plan and Police and Fire Plan.
Actuarial assumptions used in the June 30, 2016, 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 experience study for Police and Fire Plan was for the period July 1, 2004
through June 30, 2009.
The State Board of Investment, which manages the investments of PERA, prepares an analysis of the
reasonableness of the long-term expected rate of return on a regular basis 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 table on the following
page.
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Long-Term
Expected Real
Asset Class Target Allocation Rate of Return
Total 100%
F. Discount Rate
The discount rate used to measure the total pension liability in 2016 was 7.5%, a reduction from the
7.9% used in 2015. 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 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.
In the Police and Fire Fund, the fiduciary net position was projected to be available to make all projected
future benefit payments of current plan members through June 30, 2056. Beginning in fiscal years ended
June 30, 2057 for the Police and Fire Fund, when projected benefit payments exceed the funds
projected fiduciary net position, benefit payments were discounted at the municipal bond rate of 2.85%
based on an index of 20-year general obligation bonds with an average AA credit rating at the
measurement date. An equivalent single discount rate of 5.60% for the Police and Fire Fund was
determined that produced approximately the same present value of projected benefits when applied to all
years of projected benefits as the present value of projected benefits using 7.50% applied to all years of
projected benefits through the point of asset depletion and 2.85% after.
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The following table 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
Discount Rate Discount Rate Discount Rate
(6.5%) (7.5%) (8.5%)
City's proportionate share of the General
Employees Fund net pension liability $ 10,759,451 $ 7,575,497 $ 4,952,786
Commission's proportionate share of the
General Employees Fund net pension liability $ 7,161,435 $ 5,042,212 $ 3,296,549
1% Decrease in 1% Increase in
Discount Rate Discount Rate Discount Rate
(4.6%) (5.6%) (6.6%)
City's proportionate share of the Police
and Fire Fund net pension liability $ 26,291,823 $ 18,781,654 $ 12,645,276
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.
Four Council Members of the City are covered 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.
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The defined contribution plan consists of individual accounts paying a lump-sum benefit, 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.
Pension expense for the year is equal to contributions made. Total contributions made by the City during
fiscal year 2016 were:
$ 2,503 $ 2,503 5% 5% 5%
A. Plan Description
The Shakopee Firefighter's Relief Association is the administrator of a single employer defined benefit
pension plan established to provide benefits for members of the Shakopee Fire Department per
Minnesota State Statutes.
The Association issues a publicly available financial report that includes financial statements and
required supplementary information. That report may be obtained by writing to Shakopee Fire Relief
Association, 129 Holmes Street South, Shakopee, Minnesota 55379 or by calling 952-233-9570.
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Defined Benefit Pension Plan Volunteer Fire Fighter's Relief Association (Continued)
B. Benefits Provided
Volunteer firefighters of the City are members of the Shakopee Fire Fighter's Relief Association. Full
retirement benefits are payable to members who have reached age 50 and have completed 20 years of
service for lump sum service pension. Partial benefits are payable to members who have reached 50 and
have completed 5 years of service. Disability benefits and widow and children's survivor benefits are
also payable to members or their beneficiaries based upon requirements set forth in the bylaws.
These benefit provisions and all other requirements are consistent with enabling state statutes.
At December 31, 2015, the following employees were covered by the benefit terms:
Total 58
D. Contributions.
Minnesota Statutes Chapter 424A.092 specifies minimum support rates required on an annual basis. The
minimum support rates from the municipality and from State aids are determined as the amount required
to meet the normal cost plus amortizing any existing prior service costs over a ten year period. The
City's obligation is the financial requirement for the year less state aids. Any additional payments by the
City shall be used to amortize the unfunded liability of the relief association. The Association is
comprised of volunteers: therefore, there are no payroll expenditures (i.e. there are no covered payroll
percentage calculations). During the year, the City recognized as revenue and as an expenditure an on
behalf payment of $ 246,910 made by the State of Minnesota for the Relief Association.
The City's net pension liability was measured as of December 31, 2015, and the total pension liability
used to calculate the net pension liability was determined by an actuarial valuation as of that date.
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Defined Benefit Pension Plan Volunteer Fire Fighter's Relief Association (Continued)
Actuarial assumptions.
The total pension liability in the December 31, 2015, actuarial valuation was determined using the
following actuarial assumptions, applied to all periods included in the measurement:
Inflation 2.75 %
Salary increase 0.00 %, average, including inflation
Investment rate of return 6.00 %, net of pensions plan investment expense:
including inflation
The value of death benefits is similar to the value of the retirement pension. Because of low retirement
ages, the plan assumes no pre-retirement mortality. Post-retirement mortality does not apply as the
benefit structure and form of payment do not reflect lifetime benefits.
The long-term return on assets has been set based on the plan's target investment allocation along with
long-term return expectations by asset class. When there is sufficient historical evidence of market
outperformance, historical average returns may be considered. Best estimates of arithmetic real rates of
return for each major asset class included in the pension plan's target asset allocation as of the
measurement date are summarized in the table below.
Total 100.00%
Discount rate.
The discount rate used to measure the total pension liability was 6.00 %. Assets were projected using
expected benefit payments and expected asset returns. Expected benefit payments by year were
discounted using the expected asset return assumption for years in which the assets were sufficient to
pay all benefit payments. Any remaining benefit payments after the trust fund is exhausted are
discounted at the municipal bond rate. The equivalent single rate is the discount rate.
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Defined Benefit Pension Plan Volunteer Fire Fighter's Relief Association (Continued)
Increase (Decrease)
Sensitivity of the net pension liability to changes in the discount rate. The following presents the net
pension liability of the City, calculated using the discount rate disclosed on the proceeding page, as well
as what the City's net pension liability would be if it were calculated using a discount rate that is 1-
percentage point lower or 1 percentage point higher than the current discount rate:
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Defined Benefit Pension Plan Volunteer Fire Fighter's Relief Association (Continued)
Pension plan fiduciary net position. Detailed information about the pension plan's fiduciary net position
is available in the separately issued relief association financial report.
G. Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources
Related to Pensions
For the year ended December 31, 2015, the City recognized pension expense of $ 177,199. At December
31, 2015, the City reported deferred outflows of resources and deferred inflows of resources related to
pensions from the following sources:
Deferred Deferred
Outflows of Inflows of
Resources Resources
$246,910 reported as deferred outflows of resources related to pensions resulting from State contributions
subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year
ended December 31, 2016. Amounts reported as deferred outflows of resources and deferred inflows of
resources related to pensions will be recognized in pension expense as follows:
2017 $ 113,215
2018 113,215
2019 113,216
2020 116,304
Total $ 455,950
At December 31, 2016, the City reported a payable of $ 0 for the outstanding amount of contributions to
the pension plan required for the year ended December 31, 2016.
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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 administered by Medica. It is the Citys 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 health care plan at the same rate as City employees. This
results in the retirees receiving an implicit rate subsidy. Contribution requirements are established by
the City, based on the contract terms with Medica. The required contributions are based on projected
pay-as-you-go financing requirements. For the year 2016, the City contributed $ 53,193 to the plan. As
of January 1, 2016, there were six retirees and two disabled officers receiving health benefits from the
Citys health plan. For the most part, the General Fund and the Employee Benefits Internal Service
Fund are typically used to liquidate net other post employment benefit obligations.
The Citys annual 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 30 years. The following table shows the components of the Citys annual OPEB cost of
the year, the amount actually contributed to the plan, and changes in the Citys net OPEB obligation to
the plan.
ARC $ 337,572
Interest on Net OPEB Obligation 49,407
Adjustment to ARC (76,752)
Annual OPEB Cost (Expense) 310,227
Contribution Made (53,193)
Increase in Net OPEB Obligation 257,034
Net OPEB Obligation - Beginning of Year 1,411,640
The Citys annual OPEB cost, the percentage of annual OPEB cost contributed to the plan and the net
OPEB obligation for 2016 was as follows:
Percentage of
Fiscal Year Annual OPEB Employer Annual OPEB Net OPEB
End Cost Contribution Cost Contributed Obligation
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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 $ 2,629,107 and the actuarial value of assets was
$ 0, resulting in an unfunded actuarial accrued liability (UAAL) of $ 2,629,107. The covered payroll
(annual payroll of active employees covered by the plan) was 12,403,330 and the ratio of the UAAL to
the covered payroll was 21.2%.
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 health care cost trend. Amounts determined regarding the funded status
of the plan and the ARC 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 Other Post Employment Benefits, 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 3.5 % discount rate, which is based on the investment yield expected to
finance benefits depending on whether the plan is funded in a separate trust (about 7.0% to 8.5%, long-
term, similar to a pension plan) or unfunded (3.5% to 5.0%, shorter-term, based on Citys general
assets). The City currently does not fund this benefit. At the actuarial valuation date, the annual health
care cost trend rate was calculated to be 3.2% initially, increased incrementally to an ultimate rate of
5.3% after five years. Both rates included a 2.75% inflation assumption. The UAAL is being amortized
as a level percentage of payroll on an open basis. The remaining amortization period at December 31,
2016 was 30 years.
NOTE 14 SEGMENT INFORMATION
The City maintains three enterprise funds that account for the sewer, storm drainage and refuse utilities.
The City considers each of its enterprise funds to be a segment. Since the required segment information
is already included in the Citys proprietary funds Balance Sheet and Statement of Revenues, Expenses
and Changes in Fund Net Position balances, this information has not been repeated in the Notes to the
Financial Statements.
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Fund equity balances are classified as follows to reflect the limitations and restrictions of the respective
funds.
Community Other
General Capital Center/ Ice Governmental
Fund Improvements Arena Funds Total
Nonspendable:
Prepaid Items $ 22,188 $ - $ - $ - $ 22,188
Restricted:
Forfeitures - - - 186,965 186,965
SCDP Grant - - - 4,734 4,734
Revolving Loans - - - 263,787 263,787
Economic Development - - - 1,503,917 1,503,917
Debt Service - - - 3,712,584 3,712,584
Capital Improvements - - 6,547,457 665,801 7,213,258
Total Restricted - - 6,547,457 6,337,788 12,885,245
Assigned:
Telecommunications - - - 70,795 70,795
Capital Improvements - 4,744,275 - 2,244,591 6,988,866
Total Assigned - 4,744,275 - 2,315,386 7,059,661
NOTE 16 COMMITTMENTS
Project Work 12/31/2016
Authorization Completed Commitment
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The City purchases commercial insurance coverage through the League of Minnesota Cities Insurance
Trust (LMCIT) with other cities in the state which is a public entity risk pool currently operating as a
common risk management and insurance program. The City pays an annual premium to the LMCIT for
its insurance coverage. The LMCIT is self-sustaining through member premiums and reinsures through
commercial companies for excess claims. The City is covered through the pool for any claims incurred
but unreported, however, retains risk for the deductible portion of its insurance policies. The amount of
these deductibles ranges from $ 500 to $ 50,000 and is considered immaterial to the financial statements.
There were no significant reductions in insurance from the previous year or settlements in excess of
insurance coverage for any of the past three years.
Through the pool, the City is subject to reassessment but due to reserves and reinsurance contracts, the
likelihood is very low. The policy limits through the pool included $ 2,000,000 aggregate for liability,
$ 1,500,000 for automobile coverage, $ 1,000,000 faithful performance employee bonding and
$ 1,000,000 for universal umbrella coverage. Property coverage is at approximately $ 134,300,000.
NOTE 18 CONTINGENCY
The City has been named as a defendant in the cleanup of the Burnsville landfill. The case is pending
further information and the outcome of liability to the City is unknown at the present time.
The City has entered into three Tax Abatement Financing agreements which meet the criteria for
disclosure under Governmental Accounting Standards Board Statement No. 77 Tax Abatement
Disclosures. The City's authority to enter into these agreements comes from Minnesota Statute 469. The
City entered into these agreements for the purpose of economic development.
Under each agreement, the City and developer agree on an amount of development costs to be
reimbursed to the developer by the City though tax revenues from the additional taxable value of the
property generated by the development (tax abatement).
Datacard Abatement was established in 2013. Entrust Datacard is the worlds largest issuer of
protected, personalized ID cards, credentials, and credit cards. The City of Shakopee awarded an
eleven-year economic development property tax abatement, ending in 2024, which required the
creation of 100 new full time jobs in Shakopee. The first year of disbursement occurred in 2014.
The total city abatement awarded was $ 334,869 with an annual maximum award of $ 36,195.
The total county abatement awarded was $ 324,324 with an annual maximum award of $ 35,055.
During the year ended December 31, 2016, the total disbursed was $ 69,778 with $35,920 from
Scott County and $33,858 from the City.
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The City has entered into three Tax Increment Financing agreements which meet the criteria for
disclosure under Governmental Accounting Standards Board Statement No. 77 Tax Abatement
Disclosures. The City's authority to enter into these agreements comes from Minnesota Statute 469. The
City entered into these agreements for the purpose of economic development.
Under each agreement, the City and developer agree on an amount of development costs to be
reimbursed to the developer by the City though tax revenues from the additional taxable value of the
property generated by the development (tax increment). A "pay-as-you-go" is established for this
amount, on which the City makes payments for a fixed period of time with available tax increment
revenue after deducting for certain administrative costs.
During the year ended December 31, 2016, the City generated $464,634 in tax increment revenue and
made $422,329 in payments to developers.
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TIF District No. 10 was established in 1996 for the purpose of establishing multifamily rental
housing. River City Centre is 52-units of multifamily rental housing owned and operated by the
Scott County Community Development Authority (CDA). Under this agreement, up to
$2,750,000 in development costs would be reimbursed over twenty-five years with the final year
being 2024. During the year ended December 31, 2016, the City generated $41,585 of tax
increment revenue and made payments of $41,585. The available balance at year end was
$2,191,642.
TIF District No. 14 was established in 2014 as an economic development TIF. J&J
Minneapolis/SanMar is a wholesale apparel and accessories distribution company. This TIF
required the creation of 150 new full time jobs in Shakopee. The first year of disbursement
occurred in 2015 and the final year will be in 2024. Under this agreement, up to $2,000,000 of
development costs will be reimbursed through tax increment over a 9 year period. During the
year ended December 31, 2016, the City generated $280,739 of tax increment revenue and made
payments on the pay-as-you-go note of $ 252,665. The available balance at year end was
$1,494,277.
TIF District No. 15 was established in 2014 for the purpose of establishing a housing unit.
Trident/All Saints Senior Living is an 80-unit senior community providing assisted living,
memory care, and care suites with 20% of the units being affordable to persons of low and
moderate income. Under the agreement, up to $1,000,000 of development costs will be
reimbursed through tax increment over a 25 year period. During the year ended
December 31, 2016, the City generated $142,310 of tax increment revenue and made payments
of $128,079. The available balance at year end was $766,848.
GASB has issued GASB Statement 74 relating to postemployment benefit plans other than pension
plans administered through trusts that meet certain criteria and includes requirements for OPEB plans
not administered through trusts. This new statement requires additional note disclosures and additional
required supplementary information. This statement is effective for financial statements for fiscal years
beginning after June 15, 2016. We are recommending that a review of your actuarial study be completed
with your actuarial firm to ensure compliance with the new standard.
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 is effective for financial statements for fiscal years beginning after June 15,
2017.
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GASB has issued GASB statement 80 relating to blending requirements for certain component units.
The new statement amends the blending requirements for financial statement presentation of component
units. The additional criterion requires blending of a component unit incorporated as a not-for-profit
corporation in which the primary government is the sole corporate member. This statement is effective
for financial statements for fiscal years beginning after June 15, 2016.
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REQUIRED SUPPLEMENTARY INFORMATION
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Actuarial UAAL as a
Actuarial Accrued Liability Unfunded Percentage of
Actuarial Value of (AAL) - AAL Funded Covered Covered
Valuation Assets Entry Age (UAAL) Ratio Payroll Payroll
Date (a) (b) (b-a) (a/b) (c ) ((b-a)/c)
* Because an actuarial valuation is being performed once every three years, the amounts for
the 01/01/08 and 01/01/09, and the 01/01/10, 01/01/11 and 01/01/12,and the 01/01/13, 01/01/14
and 01/01/15 valuation are the same.
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* Schedule is to be provided prospectively beginning with the City's fiscal year ended June 30, 2015, or after.
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* Schedule is to be provided prospectively beginning with the City's fiscal year ended June 30, 2015, or after.
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* Schedule is to be provided prospectively beginning with the City's fiscal year ended June 30, 2015, or after.
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Contributions Contributions
Statutorily in Relation to Contribution City's Covered- as a Percentage
For the Fiscal Required the Statutorily Deficiency Employee of Covered
Year Ended Contribution Required (Excess) Payroll Employee
December 31, 2016 $ 459,555 $ 459,555 $ - $ 6,127,400 7.50%
December 31, 2015 416,647 416,647 - 5,555,293 7.50%
* Schedule is to be provided prospectively beginning with the City's fiscal year ended June 30, 2015, or after.
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Contributions Contributions
in Relation to as a Percentage
Statutorily the Statutorily Contribution City's Covered- of Covered
For the Fiscal Required Required Deficiency Employee Employee
Year Ended Contribution Contributions (Excess) Payroll Payroll
December 31, 2016 $ 761,951 $ 761,951 $ - $ 4,703,401 16.20%
December 31, 2015 720,513 720,513 - 4,447,611 16.20%
* Schedule is to be provided prospectively beginning with the City's fiscal year ended June 30, 2015, or after.
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Contributions Contributions
Statutorily in Relation to Contribution City's Covered- as a Percentage
For the Fiscal Required the Statutorily Deficiency Employee of Covered
Year Ended Contribution Required (Excess) Payroll Employee
December 31, 2016 $ 299,473 $ 299,473 $ - $ 3,992,973 7.50%
December 31, 2015 273,227 273,227 - 3,643,027 7.50%
* Schedule is to be provided prospectively beginning with the City's fiscal year ended June 30, 2015, or after.
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2014 2015
Total Pension Liability (TPL)
Service cost $ 135,715 $ 139,447
Interest 224,377 228,231
Differenced between expected and actual experience - -
Changes of assumptions - -
Changes of benefit terms - -
Benefit payments, including refunds or member contributions (599,181) -
Net change in total pension liability (239,089) 367,678
Plan fiduciary net position as a percentage of the total pension liability 141.4% 127.7%
Covered employee payroll n/a n/a
Net pension liability as a percentage of covered payroll n/a n/a
The City implemented the Provisions of Governmental Accounting Standards Board Statement No. 68
for the year ended December 31, 2015. The schedules within the Required Supplementary Information
section required a ten-year presentation, but does not require retroactive reporting. Information prior to
2014 is not available. Additional years will be reported as they become available.
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Contributions
as a Percentage
Actuarial Actual Contribution Covered of Covered
For the Fiscal Year Determined Contributions Deficiency 2% State Employee Employee
Ended Contribution Paid (Excess) Aid Payroll Payroll
December 31, 2015 $ - $ - $ - $ 244,626 n/a n/a
December 31, 2014 113,868 113,868 - 227,168 n/a n/a
The Association implemented the Provisions of Governmental Accounting Standards Board Statement No. 68 for the year ended
December 31, 2015. The schedules within the Required Supplementary Information section required a ten-year presentation, but does
not require retroactive reporting. Information prior to 2014 is not available. Additional years will be reported as they become
available.
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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.
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%.
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106
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SUPPLEMENTARY INFORMATION
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CITY OF SHAKOPEE
Variance with
Budget Actual Final Budget -
Original Final Amounts Over (Under)
REVENUES
Property Taxes
General Property Taxes $ 14,955,400 $ 14,955,400 $ 14,814,140 $ (141,260)
Fiscal Disparities 1,857,500 1,857,500 1,807,792 (49,708)
Lodging Tax 325,000 325,000 388,372 63,372
Aggregate Tax 13,000 13,000 11,900 (1,100)
Total Property Taxes 17,150,900 17,150,900 17,022,204 (128,696)
Intergovernmental Revenues
Federal Grants 18,000 18,000 30,174 12,174
PERA Aid 18,000 18,000 18,170 170
Police Aid 343,000 343,000 390,012 47,012
Fire Aid 224,000 241,600 246,910 5,310
State Grants 504,500 630,300 657,513 27,213
Other Grants and Aids 1,000 1,000 1,500 500
Total Intergovernmental Revenues 1,108,500 1,251,900 1,344,279 92,379
Miscellaneous Revenues
Investment Income 145,000 125,000 118,764 (6,236)
Contributions and Donations 4,800 6,800 7,266 466
Rents 9,500 9,500 9,460 (40)
Other 65,948 66,450 83,244 16,794
Total Miscellaneous Revenues 225,248 207,750 218,734 10,984
Total Revenues 24,228,023 25,260,800 25,927,491 666,691
EXPENDITURES
General Government
Current:
Mayor and Council $ 185,260 $ 176,990 $ 171,877 $ (5,113)
Administration 1,555,530 1,355,860 1,430,285 74,425
City Clerk 399,170 326,030 327,235 1,205
Finance 1,243,700 1,154,300 1,194,485 40,185
Planning 674,905 501,720 470,494 (31,226)
Government Buildings 408,986 363,810 370,741 6,931
Unallocated 218,450 217,580 34,836 (182,744)
Total General Government 4,686,001 4,096,290 3,999,953 (96,337)
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CITY OF SHAKOPEE
Variance with
Budget Actual Final Budget -
Original Final Amounts Over (Under)
EXPENDITURES (Continued)
Public Safety
Current:
Police 7,625,014 7,690,810 7,758,048 67,238
Fire 2,079,785 2,059,380 2,112,184 52,804
Building Inspection 669,967 606,910 715,667 108,757
Capital Outlay - 60,000 37,423 (22,577)
Total Public Safety 10,374,766 10,417,100 10,623,322 206,222
Public Works
Current:
Engineering 739,178 627,340 607,934 (19,406)
Streets 2,225,116 1,934,790 2,004,914 70,124
Shop 429,595 403,310 448,324 45,014
Total Public Works 3,393,889 2,965,440 3,061,172 95,732
FUND BALANCES
Beginning of Year 9,840,110
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CITY OF SHAKOPEE
Special Revenue
Fund Balances
Restricted for:
Special Revenue 186,965 - 4,734
Debt Service - - -
Capital Projects - - -
Assigned - 70,795 -
Unassigned - - -
Total Fund Balances 186,965 70,795 4,734
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Special Revenue Debt Service
Economic 2004B 2006A 2007A
Development Refunding Improvement Improvement
Revolving Loan Authority Total Bonds Bonds Bonds
- - - - - 29,550
- - - - - 280,438
- - 8,424 - - -
1,220 7,026 9,437 1,047 1,772 730
- 29,811 29,811 - - -
- 923,612 923,612 - - -
$ 263,787 $ 2,472,379 $ 3,002,273 $ 226,434 $ 383,119 $ 467,668
- 17 17 123 - -
- - - - - 309,988
- 17 17 123 - 309,988
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CITY OF SHAKOPEE
Debt Service
2007B 2008A 2010A
Improvement Improvement Improvement
Bonds Bonds Bonds
ASSETS
Cash and Investments $ 230,531 $ 282,644 $ 214,156
Delinquent Taxes Receivable - - -
Special Assessments Receivable:
Delinquent 290 - -
Deferred 8,348 101,043 68,079
Accounts Receivable - - -
Interest Receivable 699 1,082 809
Due From Other Governments 28 - -
Land Held for Resale - - -
Total Assets $ 239,896 $ 384,769 $ 283,044
Fund Balances
Restricted for:
Special Revenue - - -
Debt Service 231,003 283,471 214,710
Capital Projects - - -
Assigned - - -
Unassigned - - -
Total Fund Balances 231,003 283,471 214,710
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Debt Service Capital Projects
2012A
Refunding 2016A Tax TIF District No. TIF District No.
Bonds Abatement Bond Total Park Reserve 10 14
- - 29,840 - - -
1,194,324 - 1,652,232 - - -
- - - 2,619 - -
7,727 877 14,743 3,459 (36) 252
1,701 - 1,729 - - -
- - - - - -
$ 2,866,971 $ 544,918 $ 5,396,819 $ 750,633 $ (36) $ 54,477
- - 123 - - -
1,194,324 - 1,682,072 - - -
1,194,324 - 1,682,195 - - -
- - - - - -
1,672,392 544,663 3,712,584 - - -
- - - 591,080 - 54,477
- - - - - -
- - - - (8,602) -
1,672,392 544,663 3,712,584 591,080 (8,602) 54,477
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CITY OF SHAKOPEE
Capital Projects
Road
TIF District No. Expansion Tree
15 Dedication Replacement
ASSETS
Cash and Investments $ 20,150 $ 94,153 $ 182,696
Delinquent Taxes Receivable - - -
Special Assessments Receivable:
Delinquent - - -
Deferred - - -
Accounts Receivable - - -
Interest Receivable 94 438 849
Due From Other Governments - - -
Land Held for Resale - - -
Total Assets $ 20,244 $ 94,591 $ 183,545
Fund Balances
Restricted for:
Special Revenue - - -
Debt Service - - -
Capital Projects 20,244 - -
Assigned - 94,591 183,545
Unassigned - - -
Total Fund Balances 20,244 94,591 183,545
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Capital Projects
Property Total
Acquisition Governmental
Sealcoat Fund City Hall Total Funds
- - - - 29,840
- - - - 1,652,232
- - 146,285 148,904 157,328
338 1,242 7,856 14,492 38,672
- - - - 31,540
- 100,000 - 100,000 1,023,612
$ 72,842 $ 368,674 $ 2,845,283 $ 4,390,253 $ 12,789,345
- - - - 140
- - - - 1,682,072
- - - - 1,682,212
- - - - 1,959,403
- - - - 3,712,584
- - - 665,801 665,801
72,842 - 1,893,613 2,244,591 2,315,386
- (31,326) - (39,928) (39,928)
72,842 (31,326) 1,893,613 2,870,464 8,613,246
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CITY OF SHAKOPEE
Special Revenue
Revolving
Forfeitures Telecommunication SCDP Grant Loan
REVENUES
Property Taxes $ - $ - $ - $ -
Tax Increment - - - -
Special Assessments - - - -
Licenses and Permits - 32,495 - -
Intergovernmental - - - -
Charges for Services - - - -
Fines and Forfeitures 47,430 - - -
Miscellaneous 10,652 - - -
Investment Income 2,016 1,131 51 2,922
Total Revenues 60,098 33,626 51 2,922
EXPENDITURES
Current
General Government - 16,918 - -
Public Safety 57,443 - - -
Culture and Recreation - - - -
Economic Development - - - -
Debt Service
Principal - - - -
Interest and Other Charges - - - -
Capital Outlay - 54,540 - -
Total Expenditures 57,443 71,458 - -
FUND BALANCES
Beginning of Year 180,555 108,627 4,683 260,865
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Special Revenue Debt Service
Economic 2004B 2006A 2007A 2007B
Development Refunding Improvement Improvement Improvement
Authority Total Bonds Bonds Bonds Bonds
- 16,918 - - - -
- 57,443 - - - -
- - - - - -
1,377,742 1,377,742 - - - -
- - - - - -
905,920 909,675 - - - 80,000
- - - - - -
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CITY OF SHAKOPEE
Debt Service
2008A 2010A 2012A 2016A Tax
Improvement Improvement Refunding Abatement
Bonds Bonds Bonds Bond
REVENUES
Property Taxes $ - $ 88,500 $ 47,386 $ -
Tax Increment - - - -
Special Assessments 60,391 31,232 628,630 -
Licenses and Permits - - - -
Intergovernmental - - - -
Charges for Services - - - -
Fines and Forfeitures - - - -
Miscellaneous - - - -
Investment Income 2,158 906 11,809 427
Total Revenues 62,549 120,638 687,825 427
EXPENDITURES
Current
General Government - - - -
Public Safety - - - -
Culture and Recreation - - - -
Economic Development - - - -
Debt Service
Principal 200,000 135,000 445,000 -
Interest and Other Charges 30,105 18,016 86,592 576,639
Capital Outlay - - - -
Total Expenditures 230,105 153,016 531,592 576,639
FUND BALANCES
Beginning of Year 401,027 207,088 1,289,479 -
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Debt Service Capital Projects
$ 784,295 $ - $ - $ - $ - $ 102,349
- - 41,585 280,739 142,310 -
768,642 - - - - -
- 549,594 - - - -
- - - - - -
- 2,730 - - - -
- - - - - -
- 90,000 - - - -
19,232 15,674 (12) 555 206 -
1,572,169 657,998 41,573 281,294 142,516 102,349
- - - - - -
- - - - - -
- - - - - -
- - 41,621 253,451 128,847 102,349
1,685,000 - - - - -
777,297 - 764 - - -
- 1,427,324 - - - -
2,462,297 1,427,324 42,385 253,451 128,847 102,349
1,120,875 - - - - -
396,680 - - - - -
- (20,261) - - - -
1,517,555 (20,261) - - - -
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CITY OF SHAKOPEE
Capital Projects
Road
Shutterfly Datacard Expansion
Abatement Abatement Dedication Lions Park
REVENUES
Property Taxes $ 106,202 $ 69,778 $ - $ -
Tax Increment - - - -
Special Assessments - - - -
Licenses and Permits - - - -
Intergovernmental - - - -
Charges for Services - - - -
Fines and Forfeitures - - - -
Miscellaneous - - - -
Investment Income - (111) 1,049 33
Total Revenues 106,202 69,667 1,049 33
EXPENDITURES
Current
General Government - - - -
Public Safety - - - -
Culture and Recreation - - - -
Economic Development 106,202 81,589 - -
Debt Service
Principal - - - -
Interest and Other Charges - - - -
Capital Outlay - - - -
Total Expenditures 106,202 81,589 - -
FUND BALANCES
Beginning of Year - 11,922 93,542 9,928
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Capital Projects
Property Total Other
Tree Acquisition Governmental
Replacement Sealcoat Fund City Hall Total Funds
$ - $ - $ - $ - $ 278,329 $ 1,062,630
- - - - 464,634 464,634
- - - - - 768,642
- - - - 549,594 582,089
9,589 - 4,158 - 13,747 1,043,557
- - - - 2,730 8,730
- - - - - 47,430
1,313 38,936 - - 130,249 391,213
2,233 346 2,914 2,525 25,412 65,465
13,135 39,282 7,072 2,525 1,464,695 4,434,390
- - - - - 16,918
- - - - - 57,443
37,044 - - - 37,044 37,044
- - 536 - 714,595 2,092,337
- - - - - 1,685,000
- - - - 764 778,061
- - 6,626 3,430,023 4,863,973 4,918,513
37,044 - 7,162 3,430,023 5,616,376 9,585,316
- - - - - 1,120,875
- - - 4,160,000 4,160,000 5,466,355
- - - - (30,222) (30,222)
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CITY OF SHAKOPEE
Information
Employee and
Equipment Buildings Park Asset Benefits Technology Self Insurnace Total
ASSETS
Current Assets
Cash and Investments, Including
Cash Equivalents $ 4,510,751 $ 3,865,428 $ 1,813,152 $ 1,042,051 $ 679,861 $ 362,790 $ 12,274,033
Accounts Receivable - - - - - 6,129 6,129
Interest Receivable 20,956 17,958 8,424 4,840 3,159 1,338 56,675
Prepaid Expenses - - - - - 183,616 183,616
Total Current Assets 4,531,707 3,883,386 1,821,576 1,046,891 683,020 553,873 12,520,453
Noncurrent Assets
Advances to Other Funds, Noncurrent 941,394 400,000 - - - - 1,341,394
Capital Assets:
Land - - 221,876 - - - 221,876
Construction in Progress - - 401,288 - - - 401,288
Infrastructure - 79,820 3,537,673 - - - 3,617,493
Buildings - 31,296,794 3,296,094 - - - 34,592,888
Machinery and Equipment 10,945,650 189,539 3,951,903 - 237,322 - 15,324,414
Total Cost 10,945,650 31,566,153 11,408,834 - 237,322 - 54,157,959
Less Accumulated Depreciation (4,725,030) (11,877,384) (4,276,368) - (188,180) - (21,066,962)
Net Capital Assets 6,220,620 19,688,769 7,132,466 - 49,142 - 33,090,997
Total Noncurrent Assets 7,162,014 20,088,769 7,132,466 - 49,142 - 34,432,391
Noncurrent Liabilities
Compensated Absences - - - 1,168,676 - - 1,168,676
Total Noncurrent Liabilities - - - 1,168,676 - - 1,168,676
Total Liabilities 143,165 - 43,365 2,124,866 30,933 5,621 2,347,950
Net Position
Investment in Capital Assets 6,220,620 19,688,769 7,132,466 - 49,142 - 33,090,997
Unrestricted 5,329,936 4,283,386 1,778,211 (1,077,975) 652,087 548,252 11,513,897
Total Net Position 11,550,556 23,972,155 8,910,677 (1,077,975) 701,229 548,252 44,604,894
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CITY OF SHAKOPEE
Information
Employee and Self
Equipment Buildings Park Asset Benefits Technology Insurance Total
OPERATING REVENUES
Rental Charges $ 612,868 $ 533,450 $ 385,900 $ - $ 365,200 $ 466,950 $ 2,364,368
Other Charges - - - - - - -
Total Operating Revenues 612,868 533,450 385,900 - 365,200 466,950 2,364,368
OPERATING EXPENSES
Salaries and Benefits - - - 38,214 - - 38,214
Depreciation 741,766 714,862 373,512 - 17,734 - 1,847,874
Professional Services - - - - 1,358 - 1,358
Repairs and Maintenance - 6,600 20,869 - 26,034 5,621 59,124
Materials and Supplies 6,426 80,959 1,557 - 290,196 - 379,138
Insurance - - - - - 134,014 134,014
Total Operating Expenses 748,192 802,421 395,938 38,214 335,322 139,635 2,459,722
Operating Income (Loss) (135,324) (268,971) (10,038) (38,214) 29,878 327,315 (95,354)
NONOPERATING REVENUES
(EXPENSES)
Investment Income 51,194 63,764 24,580 8,969 6,894 180 155,581
Donations - - 366,622 - - - 366,622
Insurance Dividends - - - - - 145,757 145,757
Gain (Loss) on Sale of Asset 114,978 (61,942) (12,038) - - - 40,998
Capital Asset Transfer 15,933 - (68,840) - - - (52,907)
Change in Net Position 46,781 (2,653,829) 330,508 (29,245) 36,772 548,252 (1,720,761)
NET POSITION
Beginning of Year 11,503,775 26,625,984 8,580,169 (1,048,730) 664,457 - 46,325,655
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CITY OF SHAKOPEE
Information
Employee and
Equipment Buildings Park Asset Benefits Technology Self Insurance Total
CASH FLOWS - OPERATING ACTIVITIES
Receipts from Customers and Users $ 612,868 $ 533,450 $ 386,397 $ - $ 365,200 $ 460,821 $ 2,358,736
Receipts from Interfund Services - 897,344 - 193,830 - - 1,091,174
Payments to Suppliers (17,074) (92,918) (84,934) - (313,827) (317,630) (826,383)
Net Cash Flows - Operating
Activities 595,794 1,337,876 301,463 193,830 51,373 143,191 2,623,527
Net Change in Cash and Cash Equivalents (390,076) (928,618) (268,586) 201,485 57,718 362,790 (965,287)
RECONCILIATION OF OPERATING
INCOME (LOSS) TO NET CASH
FLOWS - OPERATING ACTIVITIES
Operating Income (Loss) $ (135,324) $ (268,971) $ (10,038) $ (38,214) $ 29,878 $ 327,315 $ (95,354)
Adjustments to Reconcile Operating
Income (Loss) to Net Cash
Flows - Operating Activities:
Depreciation Expense 741,766 714,862 373,512 - 17,734 - 1,847,874
Changes in:
Accounts Receivable - - - - - (6,129) (6,129)
Due from Other Funds - 897,344 - - - - 897,344
Due from Other Governments - - 497 - - - 497
Accounts and Contracts Payable (10,648) (5,359) (62,508) - 3,761 5,621 (69,133)
Prepaid Expenses - - - - - (183,616) (183,616)
Compensated Absences Payable - - - 232,044 - - 232,044
Total Adjustments 731,118 1,606,847 311,501 232,044 21,495 (184,124) 2,718,881
Net Cash Flows - Operating
Activities $ 595,794 $ 1,337,876 $ 301,463 $ 193,830 $ 51,373 $ 143,191 $ 2,623,527
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CITY OF SHAKOPEE
Southwest
Holiday Metro Drug
Escrow Lighting Task Force Total Agency
Agency Fund Agency Fund Agency Fund Funds
ASSETS
Current
Cash and Investments $ 2,779,900 $ 36 $ 376,128 $ 3,156,064
Due from Other Governments - - 91,644 91,644
Prepaids - - 9,152 9,152
LIABILITIES
Accounts Payable $ - $ - $ 378,410 $ 378,410
Deposits Payable 2,779,900 36 59,204 2,839,140
Due to Other Governments - - 39,310 39,310
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CITY OF SHAKOPEE
LIABILITIES
Deposits Payable $ 2,293,485 $ 2,017,295 $ 1,530,880 $ 2,779,900
LIABILITIES
Deposits Payable $ - $ 3,860 $ 3,824 $ 36
LIABILITIES
Accounts Payable $ 413,426 $ 256,366 $ 291,382 378,410
Deposits Payable 139,883 59,037 139,716 59,204
Due to Other Governments 26,356 13,449 495 39,310
LIABILITIES
Accounts Payable $ 413,426 $ 256,366 $ 291,382 $ 378,410
Deposits Payable 2,433,368 2,080,192 1,674,420 2,839,140
Due to Other Governments 26,356 13,449 495 39,310
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STATISTICAL SECTION
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CITY OF SHAKOPEE
STATISTICAL SECTION
December 31, 2016
This part of the Citys Comprehensive Annual Financial Report (CAFR) presents detailed information
for placing in context and understanding what the information shown in the financial statements, note
disclosures and required supplementary information reveals about the Citys overall financial health.
CONTENTS Page
These schedules show trend information to help the reader understand how the Citys
financial performance and well being have changed over time.
Portrayed is information to help the reader assess the Citys most important local revenue
source, the property tax.
These schedules present information to help the reader assess the affordability of the Citys
current levels of outstanding debt and the Citys ability to issue additional debt in the future.
Shown are demographic and economic indicators to help the reader understand the
environment within which the Citys financial activities take place.
These schedules shown service and infrastructure data to help the reader understand how
the information in the Citys financial report relates to the services the City provides and the
Source: Unless noted otherwise, the information in these schedules is from the CAFR for the relevant
year.
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CITY OF SHAKOPEE
Business-Type Activities:
Net Investment in Capital Assets $ 114,546,218 $ 115,124,238 $ 114,331,216 $ 115,064,968
Restricted 1,026,351 1,756,369 3,574,612 4,889,050
Unrestricted 46,169,289 49,366,581 55,595,594 59,014,070
Total Business-Type
Activities Net Position $ 161,741,858 $ 166,247,188 $ 173,501,422 $ 178,968,088
Primary Government:
Net Investment in Capital Assets $ 228,080,274 $ 228,034,031 $ 226,428,364 $ 226,970,120
Restricted 14,107,688 23,672,314 20,093,477 6,733,179
Unrestricted 74,486,220 71,453,352 84,428,170 102,924,172
Total Primary
Government Net Position $ 316,674,182 $ 323,159,697 $ 330,950,011 $ 336,627,471
From 2007-2010, the SPUC Funds, Water and Electric Enterprise Funds, were reported as a
blended component unit of the City. In 2011, SPUC funds have been presented as discretely
presented component units as it no longer met the criteria for blending.
The City implemented GASB Statemetn No. 68 and GASB Statement No. 71 in 2015. Years
prior to 2015 have not been restated.
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Table 1
133
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CITY OF SHAKOPEE
Business-Type Activities:
Electric 34,710,974 36,186,676 30,140,842 32,700,410 - -
Water 3,332,132 3,461,261 3,316,102 3,293,079 - -
Sewer 2,938,955 3,308,759 3,398,117 3,685,417 3,807,322 3,926,541
Storm 1,352,078 1,435,376 1,264,261 1,792,749 1,382,391 1,445,633
Refuse - - - - - -
Total Business-Type Activities Expenses 42,334,139 44,392,072 38,119,322 41,471,655 5,189,713 5,372,174
Total Primary Government Expenses $ 76,172,825 $ 69,545,733 $ 63,112,363 $ 67,013,416 $ 30,503,181 $ 31,046,887
PROGRAM REVENUES:
Governmental Activities:
Charges for Services:
General Government $ 583,247 $ 606,259 $ 680,681 $ 652,686 $ 721,180 $ 3,356,772
Public Safety 1,650,235 1,506,680 1,677,772 1,716,573 1,503,188 1,524,158
Public Works 2,615,402 2,354,276 1,342,173 941,224 478,788 454,145
Culture and Recreation 1,086,750 1,295,772 1,013,044 1,039,820 1,071,482 2,222,430
Economic Development - - - - 7,100 16,500
Operating Grants and Contributions 1,943,805 1,660,191 1,485,124 2,943,857 3,606,089 2,106,559
Capital Grants and Contributions 2,463,129 1,825,124 1,241,884 952,450 3,152,881 1,479,343
Total Governmental Activities
Program Revenues 10,342,568 9,248,302 7,440,678 8,246,610 10,540,708 11,159,907
Business-Type Activities:
Charges for Services:
Electric 37,407,565 38,732,701 34,272,099 36,872,008 - -
Water 3,525,140 3,390,309 3,605,498 4,417,498 - -
Sewer 2,806,371 2,556,299 3,485,882 3,508,947 2,941,753 3,728,189
Storm 1,505,247 1,379,821 1,405,560 1,281,986 1,083,878 1,442,394
Refuse - - - - - -
Operating Grants and Contributions - - - 6,415 - -
Capital Grants and Contributions 4,138,977 1,007,519 1,879,530 1,661,001 93,810 348,756
Total Business-Type Activities
Program Revenues 49,383,300 47,066,649 44,648,569 47,747,855 4,119,441 5,519,339
Total Primary Government
Program Revenues $ 59,725,868 $ 56,314,951 $ 52,089,247 $ 55,994,465 $ 14,660,149 $ 16,679,246
Business-Type Activities:
Investment Earnings 3,185,863 3,128,741 1,336,979 1,279,872 758,182 423,946
Gain on Disposal of Assets - - - - - -
Transfers (1,111,046) (1,297,988) (1,899,577) (2,089,406) (100,000) (100,000)
Total Business-Type Activities 2,074,817 1,830,753 (562,598) (809,534) 658,182 323,946
Total Primary Government $ 18,577,802 $ 19,716,297 $ 17,525,845 $ 16,696,411 $ 16,439,280 $ 16,099,062
From 2007-2010, the SPUC funds, Water and Electric Enterprise Funds, were reported as a blended component unit of the City. In 2011, SPUC Funds have been presented as
discretely presented component units as it no longer met the criteria for blending.
The City implemented GASB Statement No. 68 and GASB Statement No. 71 in 2015. Years prior to 2015 have not been restated.
134
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Table 2
- - - -
- - - -
4,096,504 3,777,866 3,824,026 3,843,232
1,641,438 1,924,853 1,726,149 1,848,768
- - 127,781 127,034
5,737,942 5,702,719 5,677,956 5,819,034
$ 32,823,923 $ 38,726,488 $ 36,284,207 $ 39,849,379
- - - -
- - - -
3,004,826 2,916,192 2,829,981 3,292,166
1,720,653 1,211,793 1,765,679 1,632,218
- 72,167 103,637 105,309
- - - -
7,780 496,655 65,844 183,142
135
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CITY OF SHAKOPEE
Only 2010-2016 are reported in compliance with GASB Statement No. 54. 2007-2009 are reported as previously stated.
136
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Table 3
- - - - - -
- - - - - -
- - - - - -
9,172,747 9,503,652 9,076,549 9,824,097 9,818,537 10,739,178
$ 9,304,194 $ 9,522,841 $ 9,092,989 $ 9,838,046 $ 9,840,110 $ 10,761,366
$ - $ - $ - $ - $ - $ -
- - - - - -
- - - - - -
- - - - - -
- - - - - -
- - - - - -
- - - - - -
- - - - - -
- - - - - -
- - - - - -
- - - - - -
- - - - - -
- - - - - -
- - - - - -
- - - - - -
- - - - - -
(484,089) (384,965) (1,716) (7,316) (1,715,102) (39,928)
$ 14,738,872 $ 22,226,910 $ 18,609,208 $ 16,048,927 $ 11,661,282 $ 19,904,978
137
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CITY OF SHAKOPEE
EXPENDITURES:
General Government 3,479,925 3,517,957 3,331,193 2,960,233
Police 8,342,017 8,462,288 8,604,704 9,012,567
Public Works 3,769,491 3,628,954 3,591,049 3,902,622
Culture and Recreation 3,651,539 4,101,175 3,898,844 4,075,919
Economic Development - 522,074 316,566 270,915
Debt Service:
Principal 3,110,000 3,280,000 2,660,000 3,800,000
Interest and Other Charges 1,025,868 1,077,711 1,077,325 833,245
Capital Outlay 7,288,033 3,300,942 1,797,299 2,812,488
Total Expenditures 30,666,873 27,891,101 25,276,980 27,667,989
Excess of Revenues
Under Expenditures (6,448,206) (2,968,005) (1,428,755) (3,608,736)
138
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Table 4
- 4,865,000 - - - 29,500,000
- - 150 314 - 9,134
- 73,480 - - - 2,237,727
2,968,919 3,367,400 4,890,809 3,531,038 6,135,344 6,916,355
(2,750,830) (3,002,400) (4,540,809) (2,932,028) (5,145,452) (3,378,977)
- - - - (634,070) -
139
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CITY OF SHAKOPEE
Table 5
TAX CAPACITY AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY
Last Ten Fiscal Years
Taxable Tax
Estimated Capacity as a
Commercial Less: Less Net Net Taxable Total Taxable Percentage of
Fiscal Residential Industrial Other Tax Increment Fiscal Tax Direct Market Estimated
Year Property Property Property Property Disparities Capacity Tax Rate Value Market Value
2007 26,817,616 14,013,644 675,479 378,593 1,963,379 39,164,767 0.31939 3,419,040,600 1.15%
2008 29,942,078 15,426,355 741,679 411,490 1,846,919 43,851,703 0.31925 3,800,795,500 1.15%
2009 29,805,971 16,088,685 1,319,935 156,799 1,862,715 45,195,077 0.32630 3,850,591,200 1.17%
2010 27,805,069 16,459,872 1,279,807 151,914 1,584,552 43,808,282 0.33710 3,710,814,056 1.18%
2011 24,652,932 18,351,835 1,304,688 161,430 1,630,522 42,517,503 0.34731 3,570,069,500 1.19%
2012 23,180,073 17,956,273 852,512 155,002 1,740,447 40,093,409 0.36655 3,347,179,800 1.20%
2013 22,824,263 17,577,547 576,049 107,928 1,707,617 39,162,314 0.41996 3,064,695,700 1.28%
2014 22,782,372 17,580,049 589,717 214,592 1,961,307 38,776,239 0.41437 3,206,518,700 1.21%
2015 26,419,959 18,769,230 625,872 408,172 1,918,874 43,488,015 0.37862 3,629,757,200 1.20%
2016 27,838,939 20,111,657 670,839 384,578 1,857,605 46,379,252 0.37902 3,844,106,800 1.21%
140
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CITY OF SHAKOPEE
Table 6
DIRECT AND OVERLAPPING PROPERTY TAX RATES
Last Ten Fiscal Years
141
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CITY OF SHAKOPEE
Table 7
PRINCIPAL TAXPAYERS
Current Year and Nine Years Ago
2016 2007
Percentage Percentage
2015/16 of Total 2006/07 of Total
Tax Cap. Tax Cap. Tax Cap. Tax Cap.
Taxpayer Type of Business Value Rank Value Value Rank Value
142
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CITY OF SHAKOPEE
Table 8
PROPERTY TAX LEVIES AND COLLECTIONS
Last Ten Fiscal Years
Ratio of
Accumulated
Percentage Delinquent
Collections Percentage Collections of Total Accumulated Taxes to
Year Tax of Current of Levy of Prior Total Collections Delinquent Current
Collected Levy Years Taxes Collected Years Taxes Collections To Tax Levy Taxes Years Taxes
143
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CITY OF SHAKOPEE
Table 9
RATIO OF OUTSTANDING DEBT BY TYPE
Last Ten Fiscal Years
Governmental Activities
Business-type
Special Activities Total Percentage
Fiscal G.O. Assessment Revenue Primary of Personal Per
Year Bonds Bonds Bonds Government Income Capita
Note: From 2007-2010, the SPUC Funds, Water and Electric Enterprise Funds, were reported as a blended
component unit of the City. In 2011, SPUC Funds have been presented as discretely presented component
units as it no longer met the criteria for blending.
144
Page 196 of 334
CITY OF SHAKOPEE
Table 10
RATIOS OF GENERAL BONDED OUTSTANDING
Last Ten Fiscal Years
Percentage of Percentage of
Actual Taxable Total
Fiscal G.O. Value of Per Personal
Year Bonds Property Capita Income
Sources:
1. Metropolitan Council estimated for population.
2007-2009 populations are the City's estimate.
2. Scott County Auditor
145
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146
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CITY OF SHAKOPEE
Table 11
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
December 31, 2016
Percentage Amount
Applicable Applicable
G.O. To City of To City of
Debt Shakopee (1) Shakopee
Direct Debt:
City of Shakopee $ 36,030,000 100.0% $ 36,030,000
Overlapping Debt:
Independent School District No. 720 210,545,000 85.4% 179,856,678
Independent School District No. 191 207,630,000 2.3% 4,801,655
Scott County 74,730,000 27.3% 20,395,033
Metropolitan Council (2) 189,226,614 1.3% 2,386,869
Total Overlapping Debt: 682,131,614 207,440,235
Source:
Scott County Taxation Department
Metropolitan Council
Note: Overlapping governments are those that coincide, at least in part, with geographic boundaries of
the City. This schedule estimates the portion of the outstanding debt of those overlapping governments
that is borne by the residents and businesses of the City. This process recognizes that, when
considering the City's ability to issue and repay long-term debt, the entire debt burden borne by the
residents and businesses should be taken into account. However, this does not imply that every
taxpayer is a resident, and therefore responsible for repaying the debt of each government.
(1) The percentage of overlapping debt is estimated using net tax capacity. Applicable percentages
were estimated by determining the portion of net tax capacity that is within the City's boundaries and
dividing it by total net tax capacity for each entity.
(2) Excludes general obligation debt supported by wastewater revenues and housing rental payments.
Includes certificates of participation.
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CITY OF SHAKOPEE
NOTE (A):
M.S.A. Section 475.53 (Limit on Net Debt)
Subdivision 1. Generally, except of otherwise provided in Sections 475.51 to 475.75, no municipality, except a
school district or a city of the first class, shall incur or be subject to a net debt in excess of 2%
(3% starting 2008) of the market value of taxable property in the municipality."
NOTE (B):
M.S.A. Section 475.51 Definitions: Subdivision 4. "Net debt" means the amount remaining after deduction
from its gross debt the aggregate of the principal of the following:
(1) Obligations issued for improvements which are payable wholly or partly from the proceeds of special
assessments levied upon property specially benefited thereby, including those which are general obligations
of the municipality issuing them, if the municipality is entitled to reimbursement in whole or in part from
the proceeds of the special assessments.
(2) Warrants or orders having no definite or fixed maturity.
(3) Obligations payable wholly from the income of revenue-producing conveniences.
(4) Obligations issued to create or maintain a permanent improvement revolving fund.
(5) Obligation issued for the acquisition, and betterment of public waterworks systems, and public lighting,
heating or power systems and on any combination thereof or for any other public convenience from
which a revenue is or may be derived.
(6) Amount of all money and the face value of all securities held as a sinking fund for the extinguishment
of obligations other than those deductible under this subdivision.
M.S.A. Section 469.178, subdivision 1. (tax increment bonds) "... The bonds are not included for purposes
of computing the net debt of any municipality."
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Table 12
149
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CITY OF SHAKOPEE
Table 13
PLEDGED REVENUE COVERAGE
Last Ten Fiscal Years
Utility Bonds
Utility Less: Net
Fiscal Service Operating Available Debt Service
Year Charges Expense Revenue Principal Interest Coverage
2011 - - - - - -
2012 - - - - - -
2013 - - - - - -
2014 - - - - - -
2015 - - - - - -
2016 - - - - - -
Note: From 2007-2010, the SPUC Funds, Water and Electric Enterprise Funds,were reported
as a blended component unit of the City. In 2011, SPUC Funds have been presented as
discretely presented component units as it no longer met the criteria for blending.
150
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CITY OF SHAKOPEE
Table 14
DEMOGRAPHIC AND ECONOMIC STATISTICS
Last Ten Calendar Years
Source: 1. 2010 is the official census figure. 2007-2009, 2011-2016 are the City's estimate.
2. Shakopee School District, SACS, Bloomington Lutheran
3. Minnesota Department of Employment and Economic Development
4. Per capita income times population
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CITY OF SHAKOPEE
Table 15
PRINCIPAL EMPLOYERS
Current Year and Nine Years Ago
2016 2007
Total Total
City City
Taxpayer Type of Business Employees Rank Employment Employees Rank Employment
Source: Minnesota Department of Employment and Economic Development and Shakopee Chamber of Commerce.
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CITY OF SHAKOPEE
Public Safety:
Police:
Licensed 46 47 47 47 50
Other 7 6 6 6 6
Fire:
Full time 1 2 3 3 3
Paid On Call 48 48 44 44 42
Building Inspection 7 6 5 5 5
Public Works:
Engineering 7 7 7 7 7
Street 12 13 13 13 13
Shop 3 3 3 3 4
Economic Development:
EDA - - - - -
Total 174 173 168 168 170
154
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Table 16
6 7 8 6 8
3 3 3 3 3
4 4 4 4 4
5 5 5 5 5
4 4 4 3 3
2 2 2 4 5
49 47 47 48 48
7 10 10 11 11
3 7 7 7 7
44 44 43 43 43
5 5 5 4 5
7 7 8 8 8
13 13 14 14 14
3 3 4 4 4
8 8 9 9 9
- 1 2 2 1
7 7 7 9 12
- 1 1 1 1
170 178 183 185 191
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CITY OF SHAKOPEE
Public Safety
Police
Arrests 2,199 1,881 1,913 1,962
Citations 6,073 4,058 6,127 5,528
Calls for Service 19,606 19,057 17,909 17,831
Fire
Calls for Service 609 538 517 557
Building Inspection
Building Permits Issued 1,194 1,019 1,102 1,083
Number of Inspections 8,174 5,946 9,726 8,048
Single Family Homes Permitted 138 94 314 160
Public Works
Street
Miles of Roadway 154 154 154 154
156
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Table 17
24 47 49 45 75 50
2 5 8 7 9 7
68 89 99 68 335 79
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CITY OF SHAKOPEE
Fire Stations 2 2 2 2 2
Street:
Miles of Roadway 154 154 154 154 154
Traffic Signals 25 26 27 27 27
Parks:
Acres 1,015 1,019 1,024 1,024 1,024
Ball Fields 47 49 49 52 54
Playgrounds 22 24 24 24 26
158
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Table 18
1 1 1 1 1
4 4 4 4 4
15 15 15 15 15
2 2 2 2 2
159
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160
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City of Shakopee
Scott County, Minnesota
We have audited, in accordance with the auditing standards generally accepted in the United
States of America and the standards applicable to financial audits contained in Government
Auditing Standards issued by the Comptroller General of the United States, the financial
statements of the governmental activities, the business-type activities, the aggregate
discretely presented component unit, each major fund, and the aggregate remaining fund
information of the City of Shakopee, Minnesota as of and for the year ended December 31,
2016, and the related notes to financial statements, which collectively comprise the City's
basic financial statements, and have issued our report thereon dated May 18, 2017.
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. 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.
BerganKDV, Ltd.
bergankdv.com
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Page 215 of 334
Internal Control over Financial Reporting (Continued)
Our consideration of internal control was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control
that might be material weaknesses, or significant deficiencies. Given these limitations,
during our audit we did not identify any deficiencies in internal control that we consider to
be material weaknesses. However, material weaknesses may exist that have not been
identified.
2
Page 216 of 334
Report on Legal Compliance
We have audited, in accordance with auditing standards generally accepted in the United
States of America, and the standards applicable to financial audits contained in Government
Auditing Standards, issued by the Comptroller General of the United States, the financial
statements of the governmental activities, the business-type activities, the discretely
presented component unit, each major fund, and the aggregate remaining fund information
of the City of Shakopee, Minnesota, as of and for the year ended December 31, 2016, and
the related notes to financial statements, which collectively comprise the City's basic
financial statements, and have issued our report thereon dated May 18, 2017.
The Minnesota Legal Compliance Audit Guide for Cities, promulgated by the State Auditor
pursuant to Minnesota Statutes 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 Shakopee 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 additional procedures,
other matters may have come to our attention regarding the City's noncompliance with the
above referenced provisions.
The purpose of this report is solely to describe the scope of our testing of compliance and
the results of that testing, and not to provide an opinion on compliance. Accordingly, this
communication is not suitable for any other purpose.
3
Page 217 of 334
City of Shakopee
Communications Letter
Required Communication 3
Financial Analysis 7
Emerging Issues 16
In planning and performing our audit of the financial statements of the governmental
activities, business-type activities, the aggregate discretely presented component unit, each
major fund, and the aggregate remaining fund information of the City of Shakopee,
Minnesota, as of and for the year ended December 31, 2016, 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.
BerganKDV, Ltd.
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The accompanying memorandum also includes financial analysis provided as a basis for
discussion. The matters discussed herein were considered by us during our audit and they do
not modify the opinion expressed in our Independent Auditors Report dated May 18, 2017,
on such statements.
This communication is intended solely for the information and use of the City Council,
management, 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.
2
Page 221 of 334
City of Shakopee
Required Communication
We have audited the financial statements of the governmental activities, business-type activities, the
aggregate discretely presented component unit, each major fund, and the aggregate remaining fund
information of the City as of and for the year ended December 31, 2016. Professional standards require
that we provide you with the following information related to our audit.
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 such
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 grants. However, the objective of our tests was not to provide an opinion on compliance
with such provisions.
Generally accepted accounting principles provide for certain required supplementary information (RSI)
to supplement the basic financial statements. Our responsibility with respect to the RSI, which
supplement(s) the basic audit financial statements, is to apply certain limited procedures in accordance
with generally accepted auditing standards. However, the RSI was not audited and, because the limited
procedures do not provide us with sufficient evidence to express an opinion or provide any assurance,
we do not express an opinion or provide any assurance on the RSI.
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 as a whole.
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.
3
Page 222 of 334
City of Shakopee
Required Communication
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, 2016. 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 financial statements in the proper period.
Accounting estimates are an integral part of the financial statements prepared by management and are
based on managements 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 The City is currently allocating certain costs among the programs
and supporting services benefited. The costs are allocated based on managements estimates.
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 Relating to Pension Activity, and Deferred
Inflows of Resources relating to Pension Activity These balances are based on an 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.
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. We identified the following uncorrected misstatement(s) of the financial statements.
Management has determined its effect is immaterial, both individually and in the aggregate, to the
financial statements taken as a whole:
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.
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 that are included in the management
representation letter.
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.
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.
5
Page 224 of 334
City of Shakopee
Required Communication
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 the 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
Page 225 of 334
City of Shakopee
Financial Analysis
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 of past performance.
For the year ended December 31, 2016, revenues and transfers in exceeded expenditures and transfers
out. Total fund balance in the General Fund increased $921,256, or 9.4%, in 2016 to $10,761,366.
General Fund
$29,000,000
$25,000,000
$21,000,000
$17,000,000
$13,000,000
$9,000,000
$5,000,000
$1,000,000
2012 2013 2014 2015 2016
Revenues $21,770,348 $22,869,399 $23,794,189 $24,331,286 $25,927,491
Expenditures 18,694,101 19,539,401 20,506,749 21,063,756 21,916,614
Fund Balance 9,522,841 9,092,989 9,838,046 9,840,110 10,761,366
$400
$300
$200
$100
$-
2012 2013 2014 2015 2016
Revenues Expenditures
7
Page 226 of 334
City of Shakopee
Financial Analysis
60%
50%
51%
49%
48% 47%
46%
40%
30%
20%
10%
0%
2012 2013 2014 2015 2016
The Citys target General Fund balance is an unassigned level between 40% (minimum) and 45% of
expenditures. This level is to provide working capital for cash flow, expected decline in revenues and
unforeseen expenditures such as natural disasters. Replenishing the Fund balance when it falls below the
target level shall be accomplished by interfund transfers or budgeting for expenditures and other uses to
be less than revenues or other sources over a period not to exceed three years. For the year ended
December 31, 2016, the City maintained an unassigned fund balance of 49% of current year
expenditures. The City also evaluates the unassigned fund balance as a percentage of the next years
budgeted expenditures. Based on the 2017 budget the City has an unassigned fund balance of 44.3%.
8
Page 227 of 334
City of Shakopee
Financial Analysis
The Citys revenue in the General Fund has increased each of the last five years. During 2016, revenue
in the General Fund exceeded the prior year revenue by $1,596,205, increasing from $24,331,286 to
$25,927,491. Property taxes increased due to an increase in the General Fund levy of approximately
$688,000, as well as increased delinquency collections, and a number of tax petitions in 2015 which had
reduced revenue. Licenses and permits increased $541,000 due to increased development within the
City. Charges for services increased $298,000 with increased police contracted services and new arena
advertising and increased memberships. All other revenues were consistent with the prior year.
During 2016, property taxes represented 66% of the total General Fund revenues. Charges for services
represented the second largest component at 18%.
$25,000,000
$22,000,000
$19,000,000
$16,000,000
$13,000,000
$10,000,000
$7,000,000
$4,000,000
$1,000,000
2012 2013 2014 2015 2016
Miscellaneous $359,323 $132,202 $333,177 $319,491 $218,734
Charges for Services 4,035,921 4,304,786 4,294,637 4,452,415 4,750,514
Fines and Forfeitures 368,167 348,262 391,500 7,093 11,213
Licenses and Permits 1,229,184 1,443,885 1,534,165 2,023,436 2,564,729
Intergovernmental 991,445 1,042,127 1,191,127 1,356,733 1,344,279
Taxes and Assessments 14,786,308 15,598,137 16,049,583 16,172,118 17,038,022
9
Page 228 of 334
City of Shakopee
Financial Analysis
In 2016, total General Fund expenditures increased $852,858, or 4.0%, from $21,063,756 in 2015 to
$21,916,614 in 2016. Public safety increased $396,031 as a result of salary and benefit increases, and
additional employees. Recreation increased $315,098 due to changes in staffing levels, pay increases,
and increased electric costs with the new arena. General government and public works were consistent
with prior year amounts.
Public Works
13.97%
Public Safety
48.47%
Public Works
14.55%
Public Safety
48.55%
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City of Shakopee
Financial Analysis
For the 2016 operating year, the City Council provided a revised budget that would increase the General
Fund balance by $453,710. Revenues and expenditures exceeded expectations, resulting in both being
over budget. At year-end, revenues and transfers in exceeded expenditures and transfers out by
$921,256.
Expenditures
General government $ 4,096,290 $ 3,999,953 $ (96,337)
Public safety 10,417,100 10,623,322 206,222
Public works 2,965,440 3,061,172 95,732
Parks and recreation 4,233,860 4,232,167 (1,693)
During 2016, revenue in the General Fund exceeded the budget by $666,691, or 2.6%. Significant
revenue budget variances are a result of conservative budgeting for revenues that can fluctuate during
the year, such as licenses, permits and engineering fees. Charges for services were over the revised
budget due to increased contracts for police services and engineering fees for developments that
exceeded the amounts anticipated at the time the budget was revised.
Expenditures exceeded budgeted amounts by $203,924, or 0.9%. Public safety was over budget due to
increased compensated absences that were not included in the budget, as well as the purchase of new
software for building inspections that was not budgeted. All other functions were consistent with
budgeted amounts.
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City of Shakopee
Financial Analysis
ENTERPRISE FUNDS
The City has three enterprise funds. The following charts compare the segment information and net
position of the Sewer and Storm Drainage enterprise funds for the last five years.
Sewer Fund
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$-
$(1,000,000)
$(2,000,000)
2012 2013 2014 2015 2016
Operating Revenues $3,730,226 $2,973,474 $2,872,662 $2,845,439 $3,100,021
Operating Expenses 3,953,269 4,122,406 3,734,691 3,846,338 3,938,720
Operating Loss (223,043) (1,148,932) (862,029) (1,000,899) (838,699)
Change in Net Position (14,003) (1,162,542) (201,729) (1,425,120) (979,595)
$1,500,000
$1,000,000
$500,000
$-
$(500,000)
$(1,000,000)
2012 2013 2014 2015 2016
Service Charges $1,037,427 $1,047,160 $1,066,118 $1,102,728 $1,202,253
Operating Expenses 1,472,361 1,604,937 1,935,464 1,748,461 1,888,839
Operating Loss (434,934) (557,777) (869,346) (645,733) (686,586)
Change in Net Position 431,658 (3,004) 101,746 363,481 (720,275)
During 2016, the Sewer and Storm Drainage Funds both had operating losses. The Funds have reported
an operating loss for the past five years. This is primarily due to the depreciation expense in both Funds.
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City of Shakopee
Financial Analysis
The 2014 through 2016 levies include the General Fund and debt service levies. The tax levy is then
reduced by fiscal disparity credit that is received in the form of state aid. Disparity aid is reported as tax
revenue and reduces the amount of property tax revenue levied upon the City.
$40,000,000
$35,000,000
$30,000,000
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$-
2012 2013 2014 2015 2016
Taxable Tax Capacity $35,402,744 $32,445,035 $34,210,957 $38,705,002 $40,933,710
Certified Levy 14,717,435 15,333,211 16,137,178 16,573,266 17,372,168
* Tax capacity values and levy obtained from the League of Minnesota Cities.
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City of Shakopee
Financial Analysis
45
46.14 46.01
43.45 43.37 42.95
40 42.00 41.44
35 37.86 37.90
36.66
30
25
20
15
10
0
2012 2013 2014 2015 2016
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City of Shakopee
Financial Analysis
DEBT SERVICE
The following charts illustrate debt service requirements, including principal and interest through 2036
and bonded debt for the last five years.
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$-
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036
$35,000,000
$3,712,584
$30,000,000
$36,030,000
$25,000,000
$20,000,000
$32,317,416
$19,060,000
$15,000,000 $16,990,000
$9,574,198
$13,830,000
$10,000,000 $8,678,680 $8,215,000
$6,620,389
$3,085,157
$5,000,000 $9,485,802
$8,311,320
$7,209,611
$5,129,843
$-
2012 2013 2014 2015 2016
Gross Bonded Debt Debt Service Fund Balance Net Bonded Debt
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City of Shakopee
Emerging Issues
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:
The following are extensive summaries of each 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.
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.
GASB Statement 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 liabilitythe difference between the total OPEB
liability and assets accumulated in the trust and restricted to making benefit payments.
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City of Shakopee
Emerging Issues
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 75 carries forward from Statement 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 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.
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7.C.1.
Budget Impact:
N/A
ATTACHMENTS:
Ordinance
151.044 Major Recreation Zone (MR)of the City Code is amended to add the following
(A) Purpose. The purpose of the Major Recreation Zone is to create a high quality environment
for large amusement and recreation attractions with a regional draw, with a high degree of land
use compatibility and street efficiency. It is further the intent of the Zone to protect existing
landscape features, to preserve open space, to sensitively integrate development with the natural
landscape, and to require the planning of entire land ownerships as a unit rather than permit
piecemeal or scattered small developments.
(B) Permitted uses. Within the Major Recreation Zone, no structure or land shall be used
except for one or more of the following uses:
(1) Public recreation;
(2) Restaurants, Class I; except those having an outdoor patio or congregation area that
customers are allowed to use after 10:00 p.m. and where the nearest point of the property on
which the restaurant is located is less than 100 feet from the nearest point of the property where a
residential use is located;
(3) Restaurants, Class II, except those having an outdoor patio or congregation area that
customers are allowed to use after 10:00 p.m. and where the nearest point of the property on
which the restaurant is located is less than 100 feet from the nearest point of the property where a
residential use is located.
(4) Public buildings;
(5) Utility services;
(6) Utility service structures, subject to the following requirements:
(a) Shall not be a water tower or electrical substation or a building constructed to house
sanitary lift station controls;
(b) Shall be 20 feet or less in height;
(c) May be used only to provide weather protection for utility equipment;
(d) Shall be designed, placed, and landscaped as necessary to assure that it blends with the
neighboring uses, and is unobtrusive;
(e) Shall comply with all applicable design standards; and
Adopted in _______________ session of the City Council of the City of Shakopee, Minnesota,
held this ________ day of ____________, 2017
______________________________
Mayor of the City of Shakopee
ATTEST:
_________________________________________
City Clerk
Orderly annexation allows for both parties to provide for long term planning for their
respective communities and allows the City of Shakopee to specifically plan for certain
capital improvements that may be necessary to serve areas to be annexed.
The City of Shakopee and Jackson Township formed a steering committee in 2016 to revisit
the original agreement to ensure that it served the long term plans for both and in preparation
of the 2040 Comprehensive Plan, there was adequate discussion on what areas may be
annexed.
The Township hired its own consultant to develop a map that identified a phasing plan for the
Township. The City used that map to provide preliminary concepts for how the areas could
be served by sewer and SPUC reviewed the plans to see how water service could also be
provided.
Through the process, there were lengthy discussions on how the Township could preserve the
Also, over time with the loss of commercial property through annexation into the City, the
Township would lose significant tax revenues from commercially zoned property.
Currently the City pays the Township two years of Township tax revenues for any property
annexed into the City. To put those amounts into focus, the D.R. Horton parcel payments
was just over $3,000. Two recent annexations, a single family house and another house with
commercial property, the payment to the Township was just over $1,000.
After several months of discussion the City and the Township has agreed to a new formula
for payments to the Township for property that is annexed into the City. The taxable value
for the Township properties will be fixed at the January 1, 2017 values and the City will pay
seven times the Township's taxes for any property annexed into the City. The January 1,
2017 values would increase 3% annually, not compounded. All parties agreed that this was a
fair way to compensate the Township for lost revenue.
If property values were not to increase over time in the Township to match the three percent
factor and the Township substantially increased its levy, the City could choose not to annex
property into the City and/or also renegotiate the OAA with the Township. This is the circuit
breaker that protects both parties from increasing levy's from the Township. One of the
Township's largest expenses is for fire protection that is contracted to the City. The current
rate structure actually lowered the fees to the Township, and theoretically, as more value is
created in the City by property value growth and annexation and development in the
Township, that cost should not substantially increase given the current formula.
As part of the new agreement, the Township agrees to reduce the adjacency requirement for
annexation from 50% to 25% and to allow areas to be annexed if certain percentages of other
areas have been annexed. Because of roads and parcel shapes, without this change, it would
have been difficult to annex much of the Township.
Annexations will largely occur based on market demand. The City has received funding
from the CDA as part of the 2040 Comprehensive Plan to develop a specific plan for the
WHEREAS, the City of Shakopee (hereinafter referred to as the "City") and the Township
of Jackson (hereinafter referred to as the "Township"), both located entirely within Scott
County in the State of Minnesota, desire to accommodate growth in the most orderly
fashion, and have agreed that there is a clear need for cooperative future planning for the
land governed by the two jurisdictions; and
WHEREAS, the City and the Township entered into a Joint Resolution for Orderly
Annexation in 2002 (2002 Joint Resolution); and
WHEREAS, the City and the Township have established a committee to develop a new
joint orderly annexation agreement which has extensively discussed, studied, and
evaluated, pertinent issues regarding annexation and planning; and
WHEREAS, the Township Board and City Council have expressed their desire to
encourage future development of land near the City so as to promote the development of
municipal services and urban growth as much as is practical, while encouraging the
preservation of the character of the Township; and
WHEREAS, the City and the Township are independent local governing authorities that
represent the interests of the geographic areas and their constituents; and
WHEREAS, a new joint orderly annexation agreement is beneficial to both parties from
the standpoint of orderly planning and orderly transition of government within the area
proposed to be annexed, and provides the guidelines under which such annexation shall
take place.
Section 1- Administration
492867v10 SH155-377
2. Review and Comment by the MBAU. The Township and City mutually agree
and state that this Joint Resolution and Agreement sets forth all the conditions
for annexation and that no consideration by the MBAU is necessary for
individual annexations which occur in accordance with this Agreement. MBAU
may review and comment, but shall, within thirty (30) days, order the
annexation in accordance with the terms of this Joint Resolution.
3. No Alteration of Boundaries. The Township and City mutually agree and state
that no alterations by the MBAU of the stated boundaries of the area designated
for orderly annexation is appropriate.
6. Geographic Limitation for Annexation. All of the land in the Township is subject
to orderly annexation in accordance with this Agreement under and pursuant
to State Statute, subject to the provisions contained herein.
7. State Statute. The terms and conditions of this Agreement are created as an
addition or complement to the requirements for annexation required by law.
The language contained herein shall in no way be deemed to circumvent or
reduce requirements established by law. If changes to State Statute are
enacted during the duration of this Agreement that are more restrictive or
otherwise negate the provisions herein, the State Statute shall rule. Nothing in
this Agreement, however, is intended to confer, or expand upon, any power or
authority that the MBAU does not have pursuant to State Statute.
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10. Duration of Agreement. This Agreement shall be in force and binding from the
date that it is accepted by the MBAU and shall continue to remain in effect until
the Township and City replace or renew this Agreement with an amended joint
agreement and resolution for orderly annexation.
12. Amendment and Termination. Both parties reserve the right to initiate an
amendment or revision to this Agreement at any time. However, once in effect,
any amendment or revision to this Agreement shall require a joint resolution
approved by both the Township and the City, as well as acceptance by the
MBAU. Both parties reserve the right to request the termination of this
Agreement. However, termination of this Agreement shall require a joint
resolution approved by both the Township and the City. This Agreement shall
terminate immediately upon approval of both legislative bodies and acceptance
by the MBAU.
13. Planning and Land Use Control Authority. Scott County shall continue to
exercise all planning, land use control, and zoning authority over all property in
the orderly annexation area until such time as the City annexes the property.
The City shall exercise all planning, land use control, and zoning authority over
property after it is annexed into the City.
14. City Development Standards. The Township and City mutually agree and state
that there is an inherent financial benefit to utilize City development standards
within orderly annexation areas that will readily allow for the future extension of
public utilities. Furthermore, the Township and the City agree to work with Scott
County government to create, support, and develop standards that minimize
the amount of infrastructure, and potential assessment costs, associated with
annexation.
15. Joint Notification. Upon receiving or initiating a Petition for annexation, the City
shall send to the Town Clerk a copy of the petition, resolution, proposed plans,
and other relevant information to the Township not less than thirty (30) days
prior to adoption. This provision shall be considered in concert with, and not
necessarily in addition to, any required or existing notification procedure
maintained by the City or required by State Statute.
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16. Joint Meetings. The Township and City mutually agree to conduct a minimum
of two (2) joint meetings each calendar year to discuss matters relating to this
Agreement and to facilitate communication between the City and the Township
with respect to annexation matters, such as topics relating to:
Unless otherwise mutually agreed to by the parties, the joint meetings will be held on the
(second Wednesday?) in (February and August?). The location and time for each meeting
shall be determined jointly by the Township and City. At a minimum, one elected official
of each legislative body shall be required to attend the meeting.
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(c) Township Limit - For the purposes of this document, the Township limit
shall be defined as those portions of the outer boundary of the Township,
not adjacent to the City, adjacent to other Townships, or jurisdictional
boundaries.
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(a) Residential subdivisions/lots with a gross density greater than one (1)
dwelling unit for every five (5) acres of land based on either the number
of dwelling units or lots, whichever is greater. Residential developments
platted under the Urban Expansion Reserve Zoning provisions of the
County Zoning Ordinance shall include the outlot(s) reserved for future
development as part of the calculation of gross density, where
applicable.
Land which is tax exempt, publicly owned, utilized for utility or transportation
purposes, or other similar property shall be considered undeveloped.
8. Initiation of Annexation by City for Developed Property. The City may at any
time, without a petition of the property owners, annex developed property or
multiple adjacent properties within the Township completely surrounded by the
municipal boundary of the City, subject to the following additional conditions:
(a) Certified Notice of Intent to Annex- The City shall provide a minimum of
six months notice by certified mail to each property owner within a
developed area prior to initiating annexation. This certified notice shall
also be sent to the Township. This notice shall be considered additional
to any requirements established by state statute. The notice shall
include the following information:
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3. Tax Rates the existing City tax rate compared to the existing
Township tax rate. The notice shall also include the estimated date
when the new tax rate would take effect and first be payable to the
City. Although an individual analysis of each property is not
required, at least one representative example shall be provided that
illustrates a typical before and after effect between City and
Township taxes identified in dollars per year. The purpose of this
provision is to provide general information to property owners
within a proposed annexation area.
(b) Public Meeting Required The City shall conduct a public informational
meeting on the proposed annexation plans within ninety (90) days of the
certified notice. The date, time, location, and purpose of this meeting
shall be identified as part of the certified notice of annexation. The
purpose of this meeting is to provide general information to the public
and solicit public input on required infrastructure improvements.
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(a) Property located in Area A is eligible for annexation any time after both
the City and the Township approve this Joint Resolution.
(b) Property located in Area B is eligible for annexation any time after
December 31, 2017.
(c) Property located in Areas C and D is eligible for annexation any time
after December 31, 2017, provided, however that no property in Area C
can be annexed until at least 25% of the property located in Areas A &
B combined has been annexed into the City.
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(d) Property located in Areas E and F are eligible for annexation any time
after January 1, 2050.
The City is not obligated to initiate annexation of all of the property in any
particular area before initiating annexation of property in another area.
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(b) Reimbursement Payment The City shall reimburse the Township with
the amount of funds as determined herein by a single payment to the
Township within sixty (60) after the parcel is annexed into the City.
1. Annual Area Limits. Within any given calendar year, the City shall be limited to
a maximum area it may annex without property owner petitions. The City shall
be limited to a maximum City-initiated annexation area of two hundred and fifty
(250) acres per calendar year of developed and undeveloped property
combined. For the purposes of this Agreement, publicly owned property, or
property currently exempt from local property taxes, shall not apply or count
toward the maximum area limitation.
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the City to annex properties that are completely surrounded by the City, as
defined within this Agreement. Annexation requested by the Township is
subject to the following:
(a) The Township shall notify the City of this request by certified mail
identifying all properties requested to be annexed.
(b) The City shall have a period of one (1) year from the date of notification
to initiate the annexation of the properties associated with the request.
(c) No reimbursement shall be required from the City to the Township for
Township requested annexation of property.
3. Existing Platted Additions Sewer Hook-Up and Related Charges. The twenty
(20) existing neighborhoods set forth in Exhibit C (Qualifying Subdivisions) as
established platted subdivisions within the Township shall be subject to the
following special provisions:
(a) Notwithstanding any other provision in the City Code to the contrary, no
parcel of land in in a Qualifying Subdivision where lateral sanitary sewer service is
available will be required to hook up to the City sanitary sewer system after
annexation if the parcel has an operating septic system that complies with all
County standards, until the parcel is sold or until the septic system becomes
defective, whichever occurs first. A septic system becomes defective when: (1)
substantial repair, such as replacement of drain field lines, is needed; (2)
replacement of a well is needed; or (3) the system no longer fully complies with all
County standards.
(b) At the time of connection to the City trunk sanitary sewer, the property
owner will be required to pay all connection fees and lateral/trunk sewer charges
at the applicable rates in effect at the time of connection.
4. Exemption for Court Ordered Extension of Services. The Township and City
recognize that a situation may come to exist that a judicial decision may be
made that requires the City to extend water, sewer, or other municipal service
to a portion of the Township. If a legally binding court order exists with no
possibility of further disruption on appeal, and the contract for the extension of
services has been completed, the annexation of that property may be initiated
by the City in accordance with the Township requested annexation provisions
of this Agreement in the preceding section, rather than the more stringent City
initiated provisions. In cases where the order is relative to only a portion of a
residential subdivision, the annexation may include the entire subdivision to
facilitate the extension of services, at the discretion of the City.
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5. Road Maintenance. If land is annexed into the City whereby ownership extends
to the centerline of a Township road, the City shall assume maintenance of said
road.
JACKSON TOWNSHIP
Dated: Dated:
CITY OF SHAKOPEE
Dated: Dated:
By:
William H. Reynolds, City Administrator
City of Shakopee
Dated:
12
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EXHIBIT C
QUALIFYING SUBDIVISIONS
13
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City Boundary
Parcels
A
B
E
C F
Page 1 of 13
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City of Shakopee
Jackson Township EMV as of 1/1/17 for Taxes Payable 2018
6/29/2017
Page 2 of 13
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City of Shakopee
Jackson Township EMV as of 1/1/17 for Taxes Payable 2018
6/29/2017
Page 3 of 13
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City of Shakopee
Jackson Township EMV as of 1/1/17 for Taxes Payable 2018
6/29/2017
Page 4 of 13
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City of Shakopee
Jackson Township EMV as of 1/1/17 for Taxes Payable 2018
6/29/2017
Page 5 of 13
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City of Shakopee
Jackson Township EMV as of 1/1/17 for Taxes Payable 2018
6/29/2017
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City of Shakopee
Jackson Township EMV as of 1/1/17 for Taxes Payable 2018
6/29/2017
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City of Shakopee
Jackson Township EMV as of 1/1/17 for Taxes Payable 2018
6/29/2017
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City of Shakopee
Jackson Township EMV as of 1/1/17 for Taxes Payable 2018
6/29/2017
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City of Shakopee
Jackson Township EMV as of 1/1/17 for Taxes Payable 2018
6/29/2017
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City of Shakopee
Jackson Township EMV as of 1/1/17 for Taxes Payable 2018
6/29/2017
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City of Shakopee
Jackson Township EMV as of 1/1/17 for Taxes Payable 2018
6/29/2017
Page 12 of 13
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City of Shakopee
Jackson Township EMV as of 1/1/17 for Taxes Payable 2018
6/29/2017
$ 178,699,100
Page 13 of 13
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7.C.3.
Canterbury has completed an initial development concept plan that shows the need for
substantial new public infrastructure that could be financed through a TIF Districts.
Currently, an EAW has been sent to the various agencies for review of the impact of the
proposed development. Current plans are for residential uses along with hospitality, retail
and entertainment uses.
The redevelopment and TIF plans will be submitted for the public hearing.
Budget Impact:
ATTACHMENTS:
WHEREAS, the City of Shakopee (City) has previously established its Canterbury Park
Redevelopment Project No. 1 (the Project) pursuant to Minnesota Statutes, Sections 469.001 to
469.047, as amended (HRA Act); and
WHEREAS, the Project is now administered by the Economic Development Authority for
the City of Shakopee (the Authority); and
WHEREAS, the City and Authority wishes to provide certain financial assistance in order to
make feasible a development of new market rate housing, office, retail, and commercial spaces to be
constructed within the Project; and
WHEREAS, the City is evaluating tax increment financing (TIF) as a form of assistance to
developers within the Project, and to that end the City and Authority have determined to consider a
modification to the redevelopment plan (Project Plan) for the Project and the adoption of a TIF plan
(TIF Plan) for the proposed TIF District No. 18, and to hold a public hearing regarding those actions
in accordance with the HRA Act and Minnesota Statutes, Sections 469.174 through 469.179, as
amended (the TIF Act).
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Shakopee, that:
1. The Authority, and its staff and consultants, are hereby authorized and directed to
cause to be prepared a modification to the Project Plan and a TIF Plan for TIF District No. 18, and to
file a copy of such documents in City Hall.
2. The City Clerk is authorized and directed to prepare a notice for publication in the
City's official newspaper setting a joint public hearing before the City Council and the Authoritys
Board of Commissioners on September 5, 2017, at 7:00 p.m. in the council chambers on the
modification to the Project Plan and a TIF Plan. The notice shall be in substantially the form attached
hereto as Exhibit B, shall be published in the newspaper at least 10 but not more than 30 days prior
to the public hearing, and shall include a map of the Project area and the proposed TIF District No.
18.
3. The Authority, its staff, and consultants are authorized and directed to send notice to
the County Commissioners who represents the area to be included in TIF District No. 18 of the
proposed TIF district at least 30 days before the date of publication of the notice of public hearing.
4. The Authority, its staff, and consultants are authorized and directed to transmit a copy
5. The Authority, its staff, and consultants are directed to take all other actions necessary
to bring the modified Project Plan and the TIF Plan before the City Council at the time of the public
hearing.
Approved by the City Council of the City of Shakopee this 5th day of July, 2017.
Mayor
ATTEST:
City Clerk
2
502314v1 SH235-21
NOTICE is hereby given that the Board of Commissioners of the Economic Development
Authority of the City of Shakopee and the City Council of the City of Shakopee will hold a joint
meeting in the City Hall, 129 Holmes Street South, Shakopee, Minnesota at 7:00 p.m. on Tuesday,
September 5, 2017, to conduct a public hearing on: (1) the modification of the redevelopment plan
(the Project Plan) for the Canterbury Park Redevelopment Project No. 1 (the Project) and (2) a
Tax Increment Financing Plan (TIF Plan) for a proposed redevelopment district within the Project
(TIF District No 18).
The proposed boundaries of the Project and the proposed TIF District No 18 are shown in the
maps below. The purpose of the proposed action is to facilitate development of new market rate
housing, office, retail, and commercial spaces to be constructed within TIF District No. 18. Details
on the proposal are contained in the Project Plan and the TIF Plan, a draft copy of which will be
available for public inspection at the Shakopee City Hall during regular business hours.
Any person wishing to express an opinion on the matters to be considered at the public hearing
will be heard orally or in writing.
A-1
502314v1 SH235-21
This site is located adjacent to residential neighborhoods and extended early morning work
hours or evenings would impact the quality of life of these residents.
Staff believes that this Ordinance needs to be revised to allow early morning hour or evening
construction only under extraordinary circumstances like emergencies or if a development is
located away from residential neighborhoods. Staff also believes that residents in those areas
should be notified that the city is considering extended construction hours. A revised
Ordinance will be brought back to Council for consideration.
Budget Impact:
N/A
ATTACHMENTS:
Request Letter
Should you deem it necessary, I am available to meet to discuss and/or provide further
information. If you need any further information, please let me know. I can be contacted
at [email protected] or 651.202.0722.
Sincerely,
Eric Munt
Project Manager
Shaw Lundquist
Recommendation:
Provide direction to staff to begin platting process and to complete necessary work to prepare
property for sale including installation of road and utilities.
Discussion:
This property was acquired by the City from the Minnesota Department of Transportation.
There were a number of title issues that have now been cleared by the courts.
Staff from Engineering, Finance and Planning & Development are working on a new road
design that will reduce the amount of right of way and also allow the road to be approved as a
State Aid Route. WSB would complete a final design including providing utilities and to
submit to the State for final approval of State funding.
Staff has worked with a number of potential purchasers and will bring contracts forward.
The site will need to be platted with a final master plan. A new Phase 1 and additional Phase
2 work will need to be completed. The former truck stop location still had VOC identified in
2014 that will need to be rechecked and possibly remediated. The current Phase 1
Environmental for the site will need to be updated.
Proposed uses include Doggie Doos Spa and Retreat, Northstar Regional Rehab, a potential
apartment development and business park parcels. The site is currently zoned Highway
Business and guided for commercial.
The property currently has a temporary road through it. The property has no utility services
and currently can not be developed.
This contract will design a road that meets State Aid requirements and allow the road to
potentially be funded by State Aid. The City has State Aid funds available but they need to
be designated for this road and the State must approve the final design.
These improvements are necessary for the City to sell its land. WSB has proposed an
aggressive design and construction schedule that will allow the property to be platted and
placed under contract for sale to various parties. Because access to the road can be closed
during construction, WSB feels that construction can be accelerated.
Budget Impact:
Project is in the CIP and funding will be from State Aid.
ATTACHMENTS:
Introduction:
According to our Agreement for Professional Services within the City of Shakopee and Section
I-C-2 (Major Projects), this extension agreement is written to provide you with an estimate of
cost for engineering services for the above-referenced project. We are proposing to complete
the work as detailed in the attached Scope of Design Services, Exhibit A and Scope of
Construction Administration/Survey Services, Exhibit B. WSB & Associates, Inc. (WSB) is very
familiar with the project with our work on the MnDOT Municipal Agreement Application we
prepared for this roadway segment back in 2012.
Background:
One of the important factors for the construction of this final segment of Vierling Drive to the
west is this Vierling Drive connection will provide a local reliever and parallel route to TH 169
from CR 69 to Eagle Creek Boulevard. Currently, if an accident were to occur on TH 169, which
causes lane restriction or roadway closure, there isnt a reasonable nearby alternative to TH 169
through the City of Shakopee. Completing the Vierling Drive connection also provides a route
for area residents to utilize local streets providing greater accessibility to their homes. Long
term, the connection will provide for additional collector route access to the Shakopee Town
Square shopping center.
The Vierling Drive connection is from Taylor Street West to County Road 69. The approximate
1,000 foot connection will provide a local roadway paralleling TH 169 from County Road 69 to
Eagle Creek Boulevard. The Vierling Drive connection is understood to be four lanes to match
the current roadway section. Turn lanes will also be provided at CR 69 and at the access into
the Shakopee Town Square shopping center. Pedestrian / bicycle facilities will also be provided
to match the existing roadway section with sidewalk on the north side of the roadway and trail
on the south side of the roadway.
Scope of Services:
The attached scope of design services describes the approach and tasks proposed to be
completed by WSB for street and utility design for this project. The work plan includes
engineering design services for roadway, storm sewer, sanitary sewer and water main, signing
and striping, traffic control, trails, removals, erosion control, street lighting and conduit crossing
plans. The work scope also includes project coordination and topographic surveying.
We understand that no feasibility report will be required for this project and no fee estimate was
provided for this work in our proposal. We are proposing to complete the final design portion of
this work as described in the attached Scope of Design Services, Exhibit A, on a cost-
reimbursable basis in accordance with our current fee schedule. It is proposed that all work
under the final design portion of the contract would be considered complete after the
preconstruction conference. We will review our progress monthly and will not exceed these
amounts without your prior approval.
WSB is available to provide construction services if the City desires assistance. These would
be part of a separate contract with the City. WSB typically provides construction survey and
would be available for inspection as well.
ITEM COST
FINAL DESIGN SERVICES $128,078
EXPENSES (PERMITS, SURVEY, LATH, ETC.) $1,750
TOTAL $129,828
Please see the attached Work Plan and Estimate of Cost for a detail breakdown of the
estimated hours for this project.
We are available to begin work as soon as authorized by the City, and we anticipate we will
complete the project according to the following schedule, assuming that we receive the notice to
proceed on July 19, 2017.
Council Approves Extension Agreement and Authorizes Design ........................... July 18, 2017
Commence Final Design Work ............................................................................... July 19, 2017
Submit Plans to MnDOT, City and SPUC for review ......................................... August 18, 2017
Ready to Approve Plans and Authorize Bids ..................................................... August 15, 2017
Open Bids ........................................................................................................ September, 2017
Award Contract ..................................................................................................... October, 2017
Begin Construction............................................................................................. October 9, 2017
Substantially Complete Construction ................................................................ November, 2017
Final Wearing Course / Complete Construction .......................................................... May, 2018
This letter represents our entire understanding of the project scope. If you are in agreement,
please sign on the space provided and return one original signed copy to us for our records.
We will start immediately upon receipt of the signed agreement.
If you have any questions concerning the work plan or fee as discussed herein, please feel free
to contact me at 763-287-7189. We look forward to working with you and greatly appreciate the
opportunity to assist you and your staff in the completion of this project.
Sincerely,
Donald W. Sterna, PE
Vice President
Enclosure
City Administrator
Mayor
Date
WORK PLAN
1. Project Management
This task includes planning and coordination of all work tasks, establishment and
monitoring of budgets, meetings and correspondence with the City of Shakopee, MnDOT,
Scott County, SPUC and if necessary, the Watershed District on a periodic basis. The
project manager will provide technical direction on all aspects of the project review, all
work products and prepare monthly progress reports. The project manager will serve a
primary role in the many design considerations. Donald Sterna, PE, is proposed to manage
the project for WSB & Associates, Inc. (WSB).
3. Geotechnical Evaluation
WSB team proposes to drill 3 soil borings to a depth 5 foot depth below the lowest City
utility elevation. The field investigation will include an estimated R-Value that will be used
to establish the pavement design. Additional soil boring information required for infiltration
testing required for design will be considered additional work which is not included in this
proposal. A brief geotechnical report will be prepared summarizing the geotechnical
findings.
4. Utility Coordination
WSB will call in a Gopher State One design locate and from that, identify all utilities in the
area. We will make contact with those utilities to obtain facility mapping along with
establishing our contact to discuss future utility plans. Based on the preliminary layout,
utility conflicts will be identified and design measures will be considered to accommodate
these conflicts. The cost for these utility conflicts, if any, will be identified and included as
part of the overall cost estimate.
6.1 Data Collection: Available data will be collected from Scott County, the City of
Shakopee, MnDOT and other impacted agencies. This data will include but is not limited
to:
This task will include collecting new traffic volume data at the intersection of Vierling Drive
and the Shakopee Town Square access with a video camera and counting tubes. 48 hours of
data will be collected at the intersection. The information that will be determined from the
data will include; AM, PM and midday peak hour traffic volumes, average daily traffic
volumes, vehicle classification, pedestrian/bike volumes and speed data. In addition, WSB
will review the camera data and note any safety and/or operational issues at the intersection.
The RJR analysis together with the data collected in Task 6.1 will be assembled in the RJR
format required for submission to MnDOT State Aid.
7. Roundabout Design
WSB will complete the roundabout design based on the results of Task 6, regarding lane
configuration and following the design guidelines as indicated in Chapter 12 of the MnDOT
Road Design Manual and NCHRP 672. The roundabout will be designed to accommodate
the design vehicle and all necessary performance checks, such as fast path and phi angle,
will be completed during the preliminary design of the roundabout. It is assumed up to three
iterations of the roundabout configuration will be developed. Once a final configuration is
agreed upon, WSB will design the vertical component of the roundabout. This includes the
profiles leading to the roundabout and the longitudinal slope around the roundabout. The
roundabout will be modeled to tie into the existing topography, and construction limits will
represent those tie in points.
WSB will develop a lighting configuration near and within the roundabout to State Aid
guidelines. A photometrics layout will be generated to ensure proper lighting of the
intersection.
9. Drainage Analysis
From the previous plans, the roads within the site will be an urban design with storm sewer.
With partial installation of the facilities already complete, an analysis of the roadway
drainage area will be conducted to determine its existing condition and if additional special
stormwater management or ponding needs are required. This analysis would verify the flow
rates and determine what water quality and/or rate control will need to be designed for the
roadway portions of the project. This analysis would include catch basin spacing, per City
requirements, infiltration, pond designs, pipe and sizing of all storm sewers under the
roadway.
10. Permits
Permits will be acquired as part of the construction plan preparation. WSB will prepare and
apply for the necessary construction permits. The cost of the permits would be paid by the
City of Shakopee. The permits we anticipate that will be necessary for this project are:
4 UTILITY COORDINATION
4.1) Utility Coordination (2 meetings) 1 6 1 8 $1,118.00
5 PRELIMINARY LAYOUT
4.1 ) Prepare MnDOT Preliminary Layout & Drainage Design 2 2 16 20 40 $4,862.00
4.2 ) Preliminary Cost Estimate 1 2 12 15 $2,060.00
4.3) Field Survey 1 6 1 18 26 $4,211.00
4.4) Base Mapping Preparation 2 6 8 $836.00
7 Roundabout Design
7.1 ) Roundabout Geometrics and Profile Design 2 48 16 6 72 $10,154.00
7.2 ) Roundabout Lighting 1 16 8 6 31 $4,216.00
9 DRAINAGE DESIGN
9.1 ) Catch Basin Spacing 1 4 12 1 18 $2,420.00
9.2 ) Storm Sewer Design 1 6 32 39 $5,308.00
9.3 ) Water Quality/ Pond Design 1 2 12 15 $2,060.00
9.4 ) Hydraulic Report Preparation 2 6 8 $1,092.00
10 PERMITS
10.1 ) Permit Application (NPDES) 4 6 10 $1,386.00
10.2 ) Wetland Evaluation 6 6 $798.00
10.3 ) MCES Sanitary Sewer Permit 2 2 4 $560.00
10.4 ) MPCA and Dept. of Health 2 2 4 $560.00
Average Hourly Billing Rates 170.00 147.00 133.00 105.00 95.00 147.00 172.00 66.00
Detailed Design Labor Costs $13,940 $24,696 $53,333 $15,330 $10,640 $147 $3,096 $2,046 $128,078
Direct Expenses
Miscellaneous Expenses includes permit fees. MPCA Sewer Extension, Deptarment of Health, Scott County and NPDES $1,750
Subtotal Expenses $1,750
Midway Ford has requested payment for a Ford F550 4X2 Pickup truck for the Parks
Department. $33,071.00.
RJM Construction has requested payment number 17 for work on the Shakopee
Community Center Renovation & Ice Arena Construction. $731,299.51.
Pearson Bros Inc has completed the seal coating project and requests payment of
$296,782.65.
Included in the check list are various refunds, returns, and pass through.
Budget Impact:
Operating and capital expenditures within the 2017 budget.
ATTACHMENTS:
Key
Varies more than 10% than budget positively
Varies more than 10% than budget negatively
Within 10% of budget
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FIT/FICA $ 103,819.80
STATEINCOMETAX $ 20,990.12
PERA $ 85,368.31
HEALTHCARESAVINGS $ 7,964.10
HEALTHSAVINGSACCT $
NATIONWIDEDEFCOMP $ 12,715.10
ICMADEFERREDCOMP $ 1,057.14
MSRS $ 3,651.85
FSA $ 2,410.68
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Total $ 563,356.31