The URL can be used to link to this page

Home My WebLink About2007 06-04 CCM Joint Work Session with Financial Commission MINUTES OF THE PROCEEDINGS OF THE CITY COUNCIL OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA JOINT WORK SESSION WITH FINANCIAL COMMISSION JUNE 4, 2007 CITY HALL COUNCIL CHAMBERS CALL TO ORDER The Brooklyn Center City Council met in Joint Work Session with the Financial Commission and was called to order by Mayor Pro Tern Kay Lasman at 6:30 p.m. ROLL CALL Mayor Pro Tern Kay Lasman and Councilmembers Mary O'Connor, Dan Ryan, and Mark Yelich. Also present: City Manager Curt Boganey, Fiscal and Support Services Director Dan Jordet, and Deputy City Clerk Camille Worley. Mayor Tim Willson was absent and excused. Others present were Financial Commissioners Philip Berglin, Todd Boster, Mark Nemec, Jessica Roerick, Susan Shogren Smith, and Rex Newman. Financial Commissioner Gene Maze was absent and unexcused. COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR 2006 AUDITOR'S OPINION AND AUDIT COMMITTEE LETTER HLB TAUTGES REDPATH Andy Hering, HLB Tautges Redpath presented a PowerPoint presentation that summarized the following information: Reports Issued Opinion on Financial Statements Audit Committee Letter Report on Internal Control Report on Compliance with Minnesota Statutes Annual Financial Report o The financial statements are the responsibility of management o The role of the Independent Auditor is to report on the fair presentation of the financial statements o Audit standards followed: 06/04/07 -1- GAAS GAGAS o "Clean opinion" on the 2006 financial statements Financial Results Budget Performance o Favorable General Fund budget variances Audit Committee Letter Audit firm responsibility under U.S. audit standard. p tY Significant accounting policies GASB 44 Accounting estimates Depreciation expense Health insurance liability MCES liability Land held for resale (LHFR) Audit Adjustments Additional receivable ($93,811) Adjustment to LHFR ($208,000) Payable for unbilled MCES flows ($580,465) Grant receivable ($39,784) Disagreements with management Consultations with other auditors Issues discussed prior to retention of auditor Difficulties encountered in performing the audit Report on Internal Control The 2006 Report is based on new standard (SAS 112) SAS 112 lowered the threshold for reporting of internal control matters and established new definitions Report on Internal Control Significant Deficiency defined as "a control deficiency that adversely affects the entity's ability to initiate, authorize, record, process, or report financial data reliably in accordance with GAAP, such that there is more than a remote likelihood that a misstatement to an entity's financial statements that is more than inconsequential will not be prevented or detected" Six deficiencies noted: Approval of journal entries Approval of utility billing adjustments Determination of water consumption Liquor inventory adjustments Financial statement corrections 06/04/07 -2- Approval for use of paid time off There was discussion regarding security of the Liquor Stores including methods to prevent shoplifting. State Compliance Report Required by Minnesota Statute Section 6.65 OSA established a task force to develop audit guide for legal compliance Audit guide covers seven categories 1. Contracting and bidding 2. Deposits and investments 3. Conflicts of interest 4. Public indebtedness 5. Claims and disbursements 6. Other miscellaneous provisions 7. Tax increment provisions No findings of noncompliance for 2006 Recent Standards Audit standards SAS 103 Audit Documentation SAS 104 to 111 Risk Assessment SAS 112 Reporting on Internal Control SAS 113 Omnibus 2006 SAS 114 Auditor Communication to those Charged with Governance Accounting standards GASB 44 Statistical Section GASB 45 Other Post Employment Benefits SUMMARY OF FINANCIAL STATEMENTS INFORMATION STAFF Fiscal and Support Services Director Dan Jordet presented a PowerPoint presentation that included the following information on the Comprehensive Annual Financial Report for the year ended December 31, 2006: Anatomy of the CAFR Introductory Section Transmittal Letter List of Officers Organizational Chart Financial Section Independent Auditor's Report (opinion) Management's Discussion and Analysis (MD &A) Government Wide Financial Statements Fund Financial Statements 06/04/07 -3- Major funds Governmental Funds Proprietary Funds Notes to the Financial Statements Required Supplementary Information Combining Individual Fund Statements o All non -major funds Statistical Section Supplemental Materials Report on Legal Compliance Report on Internal Control Audit Committee Letter Government Wide Statements Two Statements Statement of Net Assets Statement of Activities Interfund Activity Removed Total Assets $140,811,395 Total Liabilities 34,705.598 Total Net Assets $106,105,797 Notes to the Financial Statements Note 1- Summary of Accounting Policies (Pages 41 -48) o Description of the significant accounting polices and procedures of the City Note 3- Stewardship, Compliance and Accountability (pages 50 -52) Excess of Expenditure over Appropriation Deficit Fund Equities Note 4- Capital Assets (page 55) o Streets, Mains Lines growing with the reconstruction projects every year Note 4 -Long Term Debt (pages 59 -62) Issued $1,460,000 (GO Improvement) Paid $2,875,000 General Fund Designated Fund Balance $7,508,690 o Is 51.62% of 2007 General Fund Budget Revenues exceeded Expenditures by $284,239 Details in Statement 9 of the Required Supplementary Information There was discussion on the vacant and City acquired properties and potential developments of such. 06/04/07 -4- Tax Increment District #3 Lower than Expected Revenues o Rebate to Brookdale in Tax court case o About $400,000 taxes plus interest Olive Garden Cracker Barrel Acquisitions o $2,949,642 Additional relocation at 57 Logan o $513,271 Beginnings of the Days Inn acquisition o $7,966 Utility Funds Enterprise Funds Other Funds TIF #1 TIF #2 Earle Brown TIF District Still calculate and reported to State as separate districts Closing of TIF #1 in 2008 Closing of TIF #2 in 2010 Capital Improvements Fund Park maintenance and improvements Golf Course Loan Central Garage Owns and maintains all vehicles of the City Holds reserves for vehicle replacements 2008 BUDGET OVERVIEW City Manager Curt Boganey presented a calendar of budget events which was discussed by the City Council and Financial Commission. It was indicated that meetings involving the Financial Commission should begin at 6:3 0 p.m. and those involving only the City Council should begin at the regular time of 6:00 p.m. OTHER BUSINESS There was no Other Business discussed. ADJOURNMENT Councilmember Yelich moved and Councilmember Ryan seconded to adjourn the Work Session at 8:50 p.m. Motion passed unanimously. 06/04/07 -5- STATE OF MINNESOTA) COUNTY OF HENNEPIN) ss. Certification of Minutes CITY OF BROOKLYN CENTER) i The undersigned, being the duly qualified and appointed City Clerk of the City of Brooklyn Center, Minnesota, certifies: 1. That attached hereto is a full, true, and complete transcript of the minutes of a Joint Meeting with the Financial Commission of the City Council of the City of Brooklyn Center held on June 4, 2007. 2. That said meeting was held pursuant to due call and notice thereof and was duly held at Brooklyn Center City Hall. 3. That the City Council adopted said minutes at its June 11, 2007, Regular Session. C a -n SZ w City Clerk 51 Mayor 06/4/07 -6-