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HomeMy WebLinkAbout2004 06-28 CCP Regular Session Public Copy AGENDA CITY COUNCIL STUDY SESSION June 28, 2004 6:00 P.M. City Council Chambers I l. Cit unc' Co il Discussion of A enda Items and uestions Y g Q 2. Miscellaneous 3. Discussion of Work Session Agenda Items as Time Permits 4. Adj ourn i CITY COUNCIL MEETING City of Brooklyn Center June 28, 2004 AGENDA L Informal Open Forum With City Council 6:45 p.m. —provides an opportunity for the public to address the Council on items which are not on the agenda. Open Forum will be limited to 15 minutes, it is not televised, and it may not be used to make personal attacks, to air personality grievances, to make political endorsements, or for political campaign purposes. Counc�l Members will not enter into a dialogue with citizens. Questions from the Council will be for clarification only. Open Forum will not be used as a time for problem solving or reacting to the comments made but, rather, for hearing the citizen for informational purposes only. 2. Invocation 7 p.m. 3. Call to Order Re ular Business Meetin g g —The City Council requests that attendees turn off cell phones and pagers during the meeting. 4. Roll Call 5. Pledge of Allegiance 6. Council Re ort P 7. Approval of Agenda and Consent Agenda —The following items are considered to be routine by the City Council and will be enacted by one motion. There will be no separate discussion of these items unless a Councilmember so requests, in which event the item will be removed from the consent agenda and considered at the end of Council Consideration Items. a. Approval of Minutes —Councilmembers not present at meetings will be recorded as abstaining from the vote on the minutes. 1. June 14, 2004 Study Session 2. June 14, 2004 Regular Session 3. June 14, 2004 Wark Session b. Licenses c. Approval of Performance Guarantee Releases for 5000 France Avenue North (Townhomes) and Mote16, 2741 Freeway Boulevard d. Resolution Declaring a Public Nuisance and Ordering the Removal of Diseased Trees CITY COLINCIL AGENDA -2- June 28, 2004 e. Approval of Mobile Computing Devices Replacement and Purchases with Forfeiture Funds 8. Presentation from HLB Tautges Redpath, LTD a. Resolution Accepting Comprehensive Annual Financial Report of the City of Brooklyn Center for the Calendar Year Ended December 31, 2003 •Requested Council Action: -Motion to approve resolution. 9. Planning Commission Item a. Planning Commission Application No. 2004-008 Submitted By Caril�ou Coffee Company, Inc. Request for a Special Use Permit to Operate a Caribou Coffee Shop at 3900 Lakebreeze Avenue North. The Planning Commission recommended approval of this application at its June 17, 2004, meeting. •Requested Council Action: -Motion to approve Planning Commission Application No. 2004-008 subject to the conditions recommended by the Planning Commission. 10. Council Consideration Items a. Resolution Expressing Appreciation for the Donation of the Brooklyn Center Lions Club in Support of the Earle Brown Days Youth Golf Tournament •Requested Council Action: —Motion to adopt resolution. b. Proclamation Declaring July 11-17, 2004, to be Community Activities, Recreation and Services Week •Requested Council Action: —Motion to adopt proclamation. c. Proclamation Declaring July 9 and 10, 2004, Relay for Life Days in Brooklyn Center •Requested Council Action: —Motion to adopt proclamation. d. Consideration of Application for Commercial Kennel License Submitted by Gentle Touch Animal Sanctuary, 4900 France Avenue Norfh —Resolution Authorizing Issuance of a Commercial Kennel License to Gentle Touch Animal Sanctuary, 4900 France Avenue North, Brooklyn Center, Nlinnesota •Requested Council Action: —Motion to adopt resolution. e. Resolution Authorizing Acceptance of a Donated Global Positioning System to the Brooklyn Center Police Department •Requested Council Action: —Motion to adopt resolution. CITY COUNCIL AGENDA -3- June 28, 2004 Resolution Authorizing Participation in Tobacco-Free Youth Recreation Program Initiative •Requested Council Action: —Motion to adopt resolution. g. Report on Code Enforcement •Requested Council Action: None, report only. h. Resolution Providing for the Transfer of Title of Former Humboldt Liquor Store to School District No. 286 •Requested Council Action: —Motion to adopt resolution. i. Request of Garden City PTO for Park Benches and Playground Equipment Contribution at Garden City School •Requested Council Action: —Council direction. j. An Ordinance Amendin Cha ter 23 of the Cit Ordinances of the Ci of Brookl g P Y tY 3'n Center Relating to the Licensure of Pawnbrokers •Requested Council Action: —Motion to approve first reading and set second reading and public hearing on July 26, 2004. k. Resolution Ratifying Advances to Cover Debt Service in Tax Increment Financing District No. 2 •Requested Council Action: —Motion to adopt resolution. L Resolution Amending the Schedule for Rental Dwelling License Fees •Requested Council Action: —Motion to adopt resolution. m. Resolution Ordering the Correction of Hazardous Conditions and Further for the Abatement of Public Nuisances, Safety, and Health Hazards with Respect to That Real Estate Located at 5025 Ewing Avenue North, Brooklyn Center, Minnesota 55430 Legally Described as Lot 13, Block 2, Twin Lake Woods 2 Addition, Hennepin County, Minnesota in the City of Brooklyn Center, Hennepin County, Minnesota •Requested Council Action: —Motion to adopt resolution. 11. Adjournment City Council Agenda Item No. 7a MINUTES OF THE PROCEEDINGS OF THE CITY COUNCIL OF THE CITY OF BROOKLYN CENTER IN THE COUNT� OF HENNEPIN AND THE STATE OF MINNESOTA STUDY SESSION CITY HALL COUNCIL CHAMBERS JLTNE 14, 2004 CALL TO ORDER STUDY SESSION The Brooklyn Center City Council met in Study Session and was called to order by Mayor Myrna Kragness at 6:04 p.m. ROLL CALL Mayor Myrna Kragness, Councilmembers Kay Lasman, Diane Niesen, and Bob Peppe. Councilmember Kathleen Cannody was absent. Also present were City Manager Michael McCauley, Assistant City Manager/Director of Operations Curt Boganey, and Deputy City Clerk Maria Rosenbaum. Councilmember Kathleen Carmody arrived at 6:10 p.m. CITY COUNCIL DISCUSSION OF AGENDA ITEMS AND QUESTIONS Council discussed the following agenda items: 7e, Resolution Accepting Insurance Settlement for Willow Lane Park Shelter Building; Councilmember Lasman asked that this item be removed from the Consent Agenda and placed on Council Consideration as 9g. She would like to report on the delay of the demolition of the building. 8b, An Ordinance Amending Chapter 35 of the City Ordinances of the City of Brooklyn Center Regarding Allowable Uses in the CC Central Commerce Overlay District; Councilmember Lasman questioned why the prohibition of religious uses was not listed in the ordinance. City Manager Michael McCauley discussed that the ordinance defines what uses can be used and religious uses are not specified and thus not allowed. 8d, An Ordinance Relating to the Regulations of Dangerous Dogs and Potentially Dangerous Dogs in the City; Amending Chapter 1 of the Brooklyn Center City Code; Councilmember Lasman inquired if this ordinance might also assist in cases where illegal dog fights might not be prosecutable due to a lack of proof of a staged dog fight. 06/ 14/04 -1- DRAFT Mr. McCauley affirmed that the dangerous dog ordinance would be an additional way of dealing with such a situation. Councilmember Carmody arrived at 6:10 p.rn. 7a, Approval of Minutes for May 24, 2004, Study Session; Councilmember Niesen informed that she would like to have the following amendments made to the May 24, 2004, Study Session minutes: Councilmember Niesen informed that she would like to have more cities added to the list of comparable cities for the salary report; and expressed her concern with the zero percent salary increase for the Brooklyn Center City Council as felt it showed a vote of no confidence. She believes that if the Council received a zero percent increase, then City staff should also not �eceive an increase in 2005. Mayor Kragness asked Councilmember Niesen what cities she would like added to the comparable list for the salary report. Councilmember Niesen asked that Brooklyn Park, Columbia Heights, Robbinsdale, St. Louis Park, and Maple Grove be considered. It was the consensus of the Council to approve the minutes with the above amendments. 8e, Consideration of Application for Commercial Kennel License Submitted by Gentle Touch Animal Sanctuary, 4900 France Avenue North; Councilmember Niesen questioned if this establishment was operating before applying for this license. Mr. McCauley discussed he believes that they have been in operation for approximately two and a half years; however, he is not aware if that operation took place in Brooklyn Center for two and half years. Councilmember Lasman questioned if there is. a limit on the number of animals for commercial kennels. Mr. McCauley discussed that there is no maximum on the number of animals for commercial kennels. He explained that the sketch submitted would indicate how many animals would be accoznmodated. Councilmember Niesen questioned if the license could be sold. Mr. McCauley responded that the license would have to be transferred and that the issue would come before the City Council for approvaL I MISCELLANEOUS Councilmember Lasman informed that she was contacted regarding a recent fire at 5233 Twin Lake Boulevard and questioned how lakeshore property could be classed as Section 8. 06/14/04 -2- DRAFT I O Mr. McCauley discussed that there is nothing to prevent someone from making a property Section 8 and outlined the requirements of becoming Section 8. He informed that he would check on the issue of lakefront property as Section 8 in the Twin Lake area. Councilmember Carmody expressed concern about one individual having several rental properties in one �pecific location. Mr. McCauley discussed that the City currently does not have a mechani�m to limit the number of renfal properties in one specific location. DISCUSSION OF WORK SESSION AGENDA ITEMS-AS TIME PERMITS No time permitted for discussion of Work Session agenda items. ADJOURNMENT A motion by Councilmember Garmody, seconded by Councilmember Lasman to adjourn the Study Session at 6:47 p.m. City Clerk Mayor 06/14/04 -3- DI2AFT MINUTES OF THE PROCEEDINGS OF THE CITY COUNCIL OF THE CITY OF BROOKLYN CENTER 1N THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA REGULAR SESSION JLJNE 14, 2004 CITY HALL COUNCIL CHAMBERS L INFORMAL OPEN FORUM WITH CITY COUNCIL CALL TO ORDER INFORMAL OPEN FORUM The Brooklyn Center City Council met in Informal Open Forum at 6:48 p,m. ROLL CALL Mayor Myrna Kragness, Councilmembers Kathleen Carmody, Kay Lasman, Diane Niesen, and Bob Peppe. Also present were City Manager Michael McCauley, Assistant City Manager/Director of Operations Curt Boganey, City Attorney Charlie LeFevere, and Deputy City Clerk Maria Rosenbaum. Lonnie Branch, 6905 Unity Avenue North, addressed the Council to express concern about the drainage ditch behind his home and to request that the Council consider this issue. He asked the Council to help him determine who would be responsible for maintaining the ditch and expressed that he would be willing to help in anyway. Mr. Branch provided pictures for the Council. Mayor Kragness indicated that City staff would review the matter with Mr. Branch. A motion by Councilmember Niesen, seconded by Councilmember Lasman to adjourn the Study Session at 6:55 p.m. Motion passed unanimously. 2. INVOCATION A moment of silence was observed. 3. CALL TO ORDER REGULAR BUSINESS MEETING The Brooklyn Center CiTy Council met in Regular Session and was called to order by Mayor Myrna Kragness at 7:01 p.m. 06/14/04 1 DRAFT 4. ROLL CALL Mayor Myrna Kragness, Councilmembers Kathleen Carmody, Kay Lasman, Diane Niesen, and Bob Peppe. Also present were City Manager Michael McCauley, Assistant City Manager/Director of Operations Curt Boganey, City Attorney Charlie LeFevere, and Deputy City Clerk Maria Rosenbaum. 5. PLEDGE OF ALLEGIANCE The Pledge of Allegiance was recited. 6. COUNCIL REPORT Cauncilmember Lasman reported that she attended the North Metro Mayors Business of the Year Award Event on May 26, 2004; the Northwest Hennepin Coalition meeting on June l, 2004; and the Qpen House sponsored by the City Council and Fire Relief Association on June 5, 2004. I Councilmember Niesen reported that on June 5, 2004, she attended the Open House sponsored by the City Council and Fire Relief Association and helped with the Twin Lake Restoration spring planting. She expressed thanks to those who volunteered with the spring plantings and encouraged citizens to come and see the outcome of the plantings. 7. APPROVAL OF AGENDA AND CONSENT AGENDA There was a motion by Councilmember Carmody, seconded by Councilmember Niesen to approve the agenda and consent agenda with the removal of Consent Agenda Item 7e to Council ti n ass Consideration Item 9g. Mo o p ed unanimously. 7a. APPROVAL OF MINUTES A motion by Councilmember Carrnody, seconded by Councilmember Niesen to approve the May 17, 2004, j oint work session with Financial Commission, and the May 24, 2004, study, regular, and work I session meeting minutes. Motion passed unanimously. 7b. LICENSES A motion by Councilmember Carmody, seconded by Councilmember Niesen to approve the following list of licenses. Motion passed unanimously. AMUSEMENT DEVICES Denn e 405 James Circle North y s R staurant 6 COMMERCIAL KENNEL Pandora's Box Veterinary Clinic 4902 France Avenue North 06I14/04 -2- DRAFT MECHANICAL Practical Systems 4342B Shady Oak Road, Hopkins RENTAL Renewal: 3614-16 50`�' Avenue North Kjirsten Bjerke-Keenan 4703 68�' Avenue North Bernard McDonough 1316 68�' Lane North Valerie Blount McKissack 5631 Bryant Avenue North Yolanda Cox 6749 Humboldt Avenue North Suburban Properties (Kwi Ha Wong) 6757 Humboldt Avenue North Suburban Properties (Kwi Ha Wong) 6761 Humboldt Avenue North Suburban Properties (Kwi Ha Wong) 6773 Humboldt Avenue North Suburban Properties (Kwi Ha Wong) 1513 Humboldt Place Suburban Properties (Kwi Ha Wong) 1549 Humboldt Place Suburban Properties (Kwi Ha Wong) 5400-02 Russell Avenue North Bruce Vanderschaaf 5900 Washburn Avenue North John Gail Lambert 5201 Xerxes Avenue North Ronald Stoneberg 6915-25 Humboldt Avenue North (50 Unit Apt.) Hillaway Investments Initial: 3 601 47�' Avenue 3613 47�' Avenue 3 713 47�' Avenue 5535 Colfax Avenue 7225 Knox Avenue 6919 Newton Avenue 7013 Newton Avenue 6900 Unity Avenue North SIGN HANGER American Eagle Sign Co. 6313 Cambridge Street, St. Louis Park DeMars Signs Inc. 410 93` Avenue NW, Coon Rapids TOBACCO RELATED PRODUCT Brothers Trading 1216 Brookdale Mall 7c. RESOLUTION DECLARING A PtTBLIC NUISANCE AND ORDERING THE REMOVAL OF DISEASED TREES RESOLUTION NO. 2004-78 Councilmember Carmody introduced the following resolution and moved its adoption: RESOLUTION DECLARING A PUBLIC NUISANCE AND ORDERING THE REMOVAL OF I DISEASED TREES 06/14/04 -3- DRAFT The motion far the adoption of the foregoing resolution was duly seconded by Councilmeml�er Niesen. Motion passed unanimously. 7d. RESOLUTION ACCEPTING WORK PERFORMED AND AUTHORIZING FINAL PAYMENT, IMPROVEMENT PROJECT NO. 2004-13, CONTRACT 2004-G, 2004 SHINGLE CREEK TRAIL IMPROVEMENTS RESOLUTION N0. 2004-79 Councilmember Carmody introduced the following resolution and moved its adoption: RESOLUTION ACCEPTING WORK PERFORMED AND AUTHORIZING FINAL PAYMENT, IMPROVEMENT PROJECT NO. 2004-13, CONTRACT 2004-G, 2004 SHINGLE CREEK TRAIL IMPROVEMENTS The m otion for the ado tion of the fore oin resolution was dul seconded b Councilmember P g g Y Y Niesen. Motion passed unanimously. 7e. RESOLUTION ACCEPTING INSURANCE SETTLEMENT FOR WILLOW LANE PARK SHELTER BUILDING This item was removed from the Consent Agenda and placed under Council Consideration as item 9g. 7f. UTILITY BILLING SOFTWARE I A motion by Councilmember Carmody, seconded by Councilmember Niesen to approve the new utility billing software. Motion passed unanimously. 8. PUBLIC HEARINGS 8a. AN ORDINANCE AMENDING CHAPTER 35 OF THE CITY ORDINANCES OF THE CITY OF BROOKLYN CENTER REGARDING THE MANUFACTURING OF BEER, WINE AND DISTILLED ALCOHOLIC BEVERAGES City Manager Michael McCauley discussed that the Planning Commission received a request for an amendment to Chapter 35 of the City Ordinances to allow the operation of a microbrewery in the I-1 and I-2 zoning district. The Planning Commission reviewed the request and recommended approvaL A motion by Councilmember Niesen, seconded by Councilmember Lasman to open the Public Hearing. Motion passed unanimously. No one wished to address the Council. 06/14/04 -4- DRAFT A motion by Councilmember Lasman, seconded by Councilmember Carmody to close the Public Hearing. Motion passed unanimously. ORDINANCE NO. 2004-09 Councilmember Lasman introduced the following ordinance and moved its adoption: AN ORDINANCE AMENDING CHAPTER 35 OF THE CITY ORDINANCES OF THE CITY OF BROOKLYN CENTER REGARDING THE MANUFACTURING OF BEER, WINE AND DISTILLED ALCOHOLIC BEVERAGES The motion for the adoption of the foregoing ordinance was duly seconded by Councilmember Carmody. Motion passed unanimously. gb• AN ORDINANCE AMENDING CHAPTER 35 OF THE CITY ORDINANCES OF THE CITY OF BROOKLYN CENTER REGARDING ALLOWABLE USES IN THE CC CENTRAL COMMERCE OVERLAY DISTRICT Mr. McCauley discussed that the Council had adopted a moratorium on the development or placement of new religious buildings within the City to allow time for staff to consider the impact such development would have as well as the appropriateness of different zonings for church development. Since that time the proposed ordinance amendment was drafted and describes allowable uses in the CC Central Commerce Overlay District. Mr. McCauley informed that this ordinance will be a work in progress and that the residential issue may be re-explored at a later date. A motion by Councilrnember Lasman, seconded by Councilmember Niesen to open the Public Hearing. Motion passed unanimously. No one wished to address the Council. A motion by Councilmember Lasman, seconded by Councilmember Carmody to close the Public Hearing. Motion passed unanimously. ORDINANCE NO. 2004-10 Councilmember Lasman introduced the following ordinance and moved its adoption: AN ORDINANCE AMENDING CHAPTER 35 OF THE CITY ORDINANCES OF THE CITY OF BROOKLYN CENTER REGARDING ALLOWABLE USES IN THE CC CENTRAL COMMERCE OVERLAY DISTRICT The motion for the adoption of the foregoing ordinance was duly seconded by Councilmember Carmody. Motion passed unanimously. 06/14/04 -5- DRAFT 8c. AN ORDINANCE AUTHORIZING THE SALE OF CERTAIN LAND IN THE CITY OF BROOKLYN CENTER Mr. McCauley discussed that this ardinance authorizes the sale of certain land that has been determined in the best interest of the City. This sale would sell the subject properties to the owners of adj acent properties for combination with the adj acent properties on the terms and conditions of a purchase agreement. This ordinance would set the framework and ratifies previous conveyances. Mayor Kragness questioned if the surrounding property owners had been notified of the sale. Mr. McCauley responded that the property owners had not been notified and that if the Council would like a mailing to be sent that could be done. A motion by Councilmember Carmody, seconded by Councilmember Lasman to open the Public Hearing. Motion passed unanimously. No one wished to address the Council. A motion by Councilmember Carmody, seconded by Councilmember Lasman to close the Public Hearing. Motion passed unanimously. ORDINANCE NO. 2004-11 Councilmember Lasman introduced the following ordinance and moved its adoption: AN ORDINANCE AUTHORIZING THE SALE OF CERTAIN LAND IN THE CITY OF BROOKLYN CENTER The motion for the adoption of the foregoing ordinance was duly seconded by Councilmember Peppe. Motion passed unanimously. A motion by Councilmember Carmody, seconded by Councilmember Lasman to direct staff to send a mailing to notify residents of the sale. Motion passed unanimously. 8d. AN ORDINANCE RELATING TO THE REGULATION OF DANGEROUS DOGS AND POTENTIALLY DANGEROUS DOGS IN THE CITY; AMENDING CHAPTER 1 OF THE BROOKLYN CENTER CITY CODE Mr. McCauley discussed that the Council spent a significant amount of time regarding framework for this proposed ordinance that creates a mechanism for potentially dangerous dogs. This ordinance would treat potentially dangerous dogs like dangerous dogs as required by State Statutes. A motion by Councilmember Lasman, seconded by Councilmember Carmody to open the Public Hearing. Motion passed unanimausly. 06/14/04 -6- DRAFT Joyce Malmberg, 3810 Oak Street, addressed the Council to question what her rights are as a dog owner if or when some one is antagonizing her dogs. She discussed that she had neighbor kids who antagonize her dogs and that she has had conversations with them and the parents; however, she is worried that they will not listen to her concern. City Attorney Charlie LeFevere informed that the ordinance is written that all definitions are called for unprovoked incidents. Councilmember Niesen suggested that Ms. Malmberg take a photo when the dogs are being provoked, to document the incidents on paper, and to contact the City Manager. A motion by Councilmember Carmody, seconded by Councilmember Niesen to close tl�e Public Hearing. Motion passed unanimously. Councilmember Niesen questioned the Animal Control Board. Mayor Kragness discussed that the Animal Control Board will be considered when something happens. Councilmember Carmody suggested that the rnembers include a resident other than a neighbor when considering board members. ORDINANCE NO. 2004-12 Councilmember Peppe introduced the following ardinance and moved its adoption: AN ORDINANCE RELATING TO TH E REGULATION OF DANGEROUS DOGS AND POTENTIALLY DANGEROUS DOGS IN THE CITY; AMENDING CHAPTER 1 OF THE BROOKLYN CENTER CITY CODE The motion for the adoption of the foregoing ordinance was duly seconded by Councilmember Lasman. Motion passed unanimously. ge CONSIDERATION OF APPLICATION FOR COMMERCIAL KENNEL LICENSE SUBMITTED BY GENTLE TOUCH ANIMAL SANCTUARY, 4900 FRANCE AVENUE NORTH —RESOLUTION AUTHORIZING ISSUANCE OF A COMMERCIAL KENNEL LICENSE TO GENTLE TOUCH ANIMAL SANCTUARY, 4900 FRANCE AVENUE NORTH, BROOKLYN CENTER, MINNESOTA Mr. McCauley discussed that under the current ordinance a parcel that is zoned I-2 and is boarding animals is an allowed use in the district and that it requires a public hearing as part of the application process. Gentle Touch Animal Sanctuary has been inspected and has met all the requirements. A motion by Councilmember Lasman, seconded by Councilmember Peppe to open the Public Hearing. Motion passed unanimausly. 06/14/04 -7- DRAFT I No one wished to address the CounciL A motion by Councilmember Lasman, seconded by Councilmember Carmody to close the Public Hearing. Motion passed unanimously. Councilmember Carmody questioned if they can add more animals and who checks these facilities. Mr. McCauley discussed that the County enforces the laws relative to animal facilities. Mr. LeFevere discussed if the Council would like to make the number of animals relevant ta the ordinance they can do so. Mr. McCauley reminded that the primary focus for this ordinance is the location. Councilmember Niesen questioned if the application is approved and later the facility is sold, can the license be transferred. Mr. LeFevere responded that the new person would have to apply. Councilmember Niesen expressed that she would like to table this item until June 28, 2004, to further investigate and explore other commercial kennels. She would like to inquire about the number of animals allowed and have other questions answered to feel comfortable about approving this application. Councilmember Carmody expressed that she would agree for the reason that the applicant was not present to answer questions raised by the Council. Councilmember Carmody asked that the applicant be asked to attend the June 28, 2004, meeting. A motion by Councilmember Niesen, seconded by Councilmember Carrnody to table this item to the June 28, 2004, meeting. Motion passed unanimously. Councilmember Niesen informed that she would call other commercial kennels. 9. COUNCIL CONSIDERATION ITEMS 9a. RESOLUTION EXPRESSING APPRECIATION FOR FIRE RELIEF ASSOCIATION SPONSORSHIP AND FIRE DEPARTMENT PARTICIPATION IN OPEN HOUSES Mayor Kragness read the resolution expressing appreciation to the Brooklyn Center Fire Department and Fire Relief Association for their generous gift of time and materials in connection with the City Council/Fire Relief Association Open Houses held on May 8 and June 5, 2004. RESOLUTION NO. 2004-80 Councilmember Carmody introduced the following resolution and moved its adoption: 06/14/04 -8- DRAFT RESOLUTION EXPRESSING APPRECIATION FOR FIRE RELIEF ASSOCIATION SPONSORSHIP AND FIRE DEPARTMENT PARTICIPATION IN OPEN HOUSES The motion for the adoption of the foregoing resolution was duly seconded by Councilmember Lasman. Motion passed unanimously. 9b. RESOLUTION EXPRESSING APPRECIATION FOR THE DONATION OF THE HONEYWELL FEDERAL CREDIT UNION IN SUPPORT OF SUMMER PROGRAMS Mayor Kragness read the resolution expressing appreciation for the donation of $1,000 from the Honeywell Federal Credit Union in support of summer programs. RESOLUTION NO. 2004-81 Councilmember Carmody introduced the amended resolution and moved its adoption: RESOLUTION EXPRESSING APPRECIATION FOR THE DONATION OF THE HONEYWELL FEDERAL CREDIT UNION IN SUPPORT OF SUMMER PROGRAMS The motion for the adoption of the foregoing resolution was duly seconded by Councilmember Niesen. Motion passed unanimously. 9c. RESOLUTION EXPRESSING APPRECIATION FOR THE GIF T OF THE TWINWEST CHAMBER OF COMMERCE IN SUPPORT OF THE NATIONAL NIGHT OUT ACTIVITIES Mayor Kragness read the resolution expressing appreciation for the gift of $250 from the TwinWest Chamber of Commerce in support of the National Night Out activities. RESOLUTION NO. 2004-82 Councilmember Carmody introduced the following resolution and moved its adoption: RESOLUTION EXPRESSING APPRECIATION FOR THE GIFT OF THE TWINWEST CHAMBER OF COMMERCE IN SUPPORT OF THE NATIONAL NIGHT OUT ACTNITIES The motion for the adoption of the foregoing resolution was duly seconded by Councilmeznber Niesen. Motion passed unanimously. 9d. AN ORDINANCE AMENDING ORDINANCE NO. 2002-11 REGARDING COUNCIL SALARIES FOR 2005-2006 Mr. McCauley discussed that the Financial Commission recommended salaries for 2005 and 2006 and that this ordinance amendment requires a public hearing. 06/14/04 -9- DRAFT A motion by Councilmember Lasman, seconded by Councilmember Peppe to approve first reading and set second reading and public hearing on July 12, 2004. Councilmember Niesen questioned if all Council salaries are set every two years. Mr. McCauley informed that all City Councils have to approve salaries by ordinance before a General Election to be effective on January 1 after the election and that all cities have the same requirement. Councilmember Niesen expressed that she believes that a zero percent increase seems to be more symbolism over substance, that she has worked hard, and is disappointed however, will support the Council. She asked that the Council continue with her request to add more comparable cities when discussing future salaries. Councilmember Carmody discussed that the Financial Commission Chair discussed the serious cuts in Local Government Aid (LGA) and that the reason for the zero percent increase was the response of the cuts in LGA. She believes this sends the correct message to residents and that the reasoning for the zero percent increase is valid. Mayor Kragness expressed that she believes the salary issue is difficult and that she is thankful that the Financial Commission has taken over the responsibility. She informed that she does not have a problem with the recommendation made by the Financial Commission. Councilmer�ber Lasman expressed that she believes the Financial Commission knows the City Council works hard, that they did what they had to for a recommendation on the Council salaries, O and that the recommendation is appropriate. A second motion was made by Councilmember Lasman, seconded by Councilmember Niesen to approve the first reading and set second reading and public hearing on July 12, 2004. Motion passed unanimously. 9e. AN ORDINANCE RELATING TO CITY GOVERNMENT; AMENDING SECTION 3.10 OF THE BROOKLYN CENTER CITY CHARTER Mr. McCauley discussed that the Charter Commission was asked to recommend an amendment to Section 3.10 of the Brooklyn Center City Charter for using strikethrough rather than brackets for matter to be deleted in ordinance amendments. The amendment would make it easier to identify which language was being removed in an ordinance amendment. A motion by Councilmember Carmody, seconded by Councilmember Niesen to approve first reading and set second reading and public hearing on July 12, 2004. Motion passed unanimously. 9f. AN ORDINANCE RELATING TO THE LICENSING OF TAXICABS; AMENDING BROOKLYN CENTER CITY CODE SECTIONS 23-702, 23-703, AND 23-704 AND ADDING NEW SECTIONS 23-706, 23-708, 23-?09, 23-710, 23-711 AND 23-712 06/ 14f 04 -10- DRAFT Mr. McCauley discussed that the City Attorney and Police Department had worked to create an ordinance that would attempt to protect persons using taxicabs in the City of Brooklyn Center by regulating the qualifications and records of operators and drivers. The draft ordinance was sent to one of the local taxicab owner/operators for input and suggestions. Two of the suggestions offered by Timothy Crandall were incorporated into the draft ordinance. Councilmember Carmody expressed thanks to Mr. Crandall for his help on the ordinance. A motion by Councilmember Carmody, seconded by Councilmember Lasman to approve the first reading and set second reading and public hearing on July 12, 2004. Motion passed unanimously. 9g. RESOLUTION ACCEPTING INSURANCE SETTLEMENT FOR WILLOW LANE PARK SHELTER BUILDING Councilmember Lasman had asked that this item be removed from the Consent Agenda to inform residents that the shelter building had been left after the fire until the insurance was settled to compensate for environmental assessment costs and the loss of the property that resulted in the structure fire. Councilmember Lasman questioned if there would be a replacement building at this location. Mr. McCauley discussed that the Public Works Department and Jim Glasoe are doing an inventory of storage needs and that this will result in a plan for storage needs on a City-wide basis. This will be part of the Capital Improvement Plan review in the fall. RESOLUTION NO. 2004-83 Councilmember Lasman introduced the following resolution and moved its adoption: RESOLUTION ACCEPTING INSURANCE SETTLEMENT FOR WILLOW LANE PARK SHELTER BUILDING The motion for the adoption of the foregoing resolution was duly seconded by Councilmember Carmody. Motion passed unanimously. 10. ADJOURNMENT There was a motion by Councilmember Carmody, seconded by Councilmember Lasman to adj ourn the City Council meeting at 8:13 p.m. Motion passed unanimously. City Clerk Mayor 06/14/04 -11- DRAFT MINUTES OF THE PROCEEDINGS OF THE CITY COUNCIL OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA CITY COUNCIL WORK SESSION JUNE 14, 2004 CITY HALL COUNCIL CHAMBERS CALL TO ORDER The Brooklyn Center City Council met in Work Session and was called to order by Mayar Myrna Kragness at 8:20 p.m. ROLL CALL Mayor Myrna Kragness, Councilmembers Kathleen Carmody, Kay Lasman, Diane Niesen, and Bob Peppe. Also present: City Manager Michael McCauley, Assistant City Manager/Director of Operations Curt Boganey, and Deputy City Clerk Maria Rosenbaum. Councilmember Peppe left the meeting at 9:06 p.m. CORRESPONDENCE REGARDING FAMILY MEMBERSHIPS AT COMMUNITY CENTER REQUESTING FAMILY MEMBERSHIPS FOR GAY, LESBIANS, AND OTHERS Mayor Kragness discussed the letter she received requesting family memberships for gay, lesbians, and others. She expressed that she believes this is something that will need to be addressed in the near future. City Manager Michael McCauley discussed that he had the City Attorney prepare a legal opinion regarding this request and outlined the response received from Mr. LeFevere. He informed that if the Council wanted to discount a membership for this reason it would be a policy issue and that could be undertaken. Councilmember Lasman expressed that she believes the best way to handle this issue would be to abide by State Law. Councilmember Peppe agreed with Councilmember Lasman and expressed that he believes the City needs to follow State guidelines. Councilmember Niesen questioned if cities other than the City of Minneapolis are changing their policy. Mayor Kragness discussed that she believes Minneapolis is the first and that this issue will be coming before many cities in the future. 06/ 14/04 -1- DRAFT i Councilmember Niesen questioned if the League of Minnesota Cities (LMC) would have any input regarding this issue. The Council indicated it would like the LMC contacted to see what other cities have done. i Couricilmember Lasman su ested that if the Council were to consider new rules for membershi s gg P she would suggest appropriate changes for members of families with children until the age of 25 or out of school. DISCUSSION OF COMMISSION APPOINTMENT PROCESS Councilmember Niesen inquired if the Mayor had interviews with applicants when they are applying for a commission. Mayor Kragness informed that she usually contacts the Commission Chairs and discusses the applications with them and then does a phone interview with the applieant. Councilmember Carmody expressed that she would like to see the application option of offering seats on other Commissions stay. She believes that people may like the change if they are not offered the commission originally applying far. Council continued the discussion regarding the application process. Councilmember Carmody suggested that the Mayar make notes after a phone interview and provide those notes to the Council for review. Mayor Kragness stated that she would be willing to do that. DISCUSSION OF COUNCIL COMMUNICATION WITH CITY STAFF Councilmember Niesen outlined information provided in an article from the International City/County Management Association (ICMA) with regards to communication with the City Manager and expressed that she would like to use common sense when communicating with City staf£ Mr. McCauley discussed that the reason the best praetice of having the Council contact him for everything is that staff are not always comfortable communicating with the Council and�that there is judgment in terms of information to be considered. He suggested the Council continue contacting him unless the issues they are using services individually such as building permits, Community Center memberships, and water bills. Councilmember Peppe left the meeting at 9:06 p.m. TOBACCO FREE ZONES IN PARKS DURING ORGANIZED YOUTH ACTIVITIES Council discussed the request received from the Park and Recreation Commission regarding tobacco free zones in parks during organized youth activities. Mr. McCauley informed that the program would provide signs for smoke free zones during organized youth activities, but compliance would be voluntary. It was the consensus of the Council to approve this request. 06/14f04 -2- DRAFT MISCELLANEOUS Councilmember Niesen asked that the missing picnic tables from Twin Beach area be researched. Mr. McCauley informed that he will check and indicated that they may have been removed due to budget cuts. Councilmember Niesen discussed the Park and Recreation Commission minutes regarding the boat parking and the cost of approximately $20,000. She expressed that she would like to give input on this issue. Mr. McCauley informed that at this time the Park and Recreation Commission is gathering input. Councilmember Niesen informed that she would like information provided on the berms and landscaping as part of the France Avenue Project area for S l st Avenue; and the sediment testing for the area. ADJOURNMENT A inotion by Councilmember Lasman, seconded by Councilmember Carmody to adj ourn the Work Session at 9:19 p.m. Motion passed unanimously. City Clerk Mayor 06/14l04 -3- DRAFT City Council Agenda Item No. 7b City o f Brooklyn Center A Millennium Community T0: Michael J. McCauley, City Manager FROM: Maria Rosenbaum, Deputy City Clerk DATE: June 23, 2004 SUBJECT: Licenses far Council Approval The following companies/persons have applied for City licenses as noted. Each company/person has fulfilled the requirements of the City Ordinance governing respective licenses, submitted appropriate applications, and paid proper fees. Licenses to be approved by the City Council on June 28, 2004. AMUSEMENT DEVICES Americinn Motel and Suites 2050 Freeway Boulevard Brooklyn Center Best Western 1501 Freeway Boulevard Brooklyn Center Legion 6110 Brooklyn Boulevard Community Center 6301 Shingle Creek Parkway Davanni's Pizza 5937 Suirunit Drive Earle Brown Lanes 6440 James Circle North Family Dollar #5110 2105 North 57�' Avenue Family Dollar #4514 6223 Brooklyn Drive MCTO 6845 Shingle Creek Parkway GARBAGE HAULER Ace Solid Waste, Inc. 6601 McKinley Street NW, Ramsey T& L Sanitation Service P.O. Box 49695, Blaine Walz Brothers Sanitation P.O. Box 627, Maple Grove MECHANICAL Aspen Air Inc. 308 SW 15 Street, #25, Forest Lake Duct Works LLC 5320 Triton Drive, Golden Valley RENTAL Renewal: 824 69�' Avenue North Joseph Roche No calls for service 4408 69�' Avenue North Eugene and Diane Wright No calls fro service 1706 71 Avenue North Patricia A, Sandeen No calls for service 6915 Brooklyn Boulevard Curtis Cady No calls for service 5242 Lakeside Place Brett and Terry Parker No calls for service 6301 Shingle Creek Parkway Recreation and Community Center Phone TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall TDD Number (763) 569-3300 FAX (763) 569-3434 FAX (763) 569-3494 www. cityofbrooklyncenter. org Page 2 Licenses for June 14, 2004 5547 L ndale Avenue North David Theisen Y No calls for service 6813 Noble Avenue North David Zemke No calls for service 5332-36 Russell Avenue North Douglas Ryan No calls for service 5256 E. Twin Lake Blvd. Brian Somkhan No calls for service Initial: 3413 62" Avenue North Mai-Thuong Nguyen No calls for service 3 319 63 d Avenue North Linda and Ai Yang No calls for service 4213 63� Avenue North Bryan Friendshuh No calls for service 4907 65�' Avenue North William Bjerke No calls for service 4204 Lakebreeze Avenue North Thinh Pham No calls for service 4811 Lakeview Avenue North Diane Krenz 1/16/04 Crime againstfamily 6825 Scott Avenue North Doug Pederson No calls for service SIGN HANGER Attrata Sign 14680 James Road, Rogers City Cauncil Agenda Item No. 7c MEMORANDUM TO: Michael J. McCauley, City Manager FROM: Ronald A. Warren, Planning and Zoning Spec' ist l_Ct SUBJECT: Site Performance Guarantee Releases DATE: June 23, 2004 The following site performance guarantees being held by the city for the completion of various site improvements should be recommended to the City Council for release: Mote16 (2741 Freeway Boulevard) Planning Commission Application No. 99009 Amount of Guarantee $25,000 (Performance Bond) Obligar Mote16 Operating LLP All site improvements and conditions for which a site performance guarantee was posted have been completed with respect to this 1999 project. An as built survey has been submitted to the Engineering Department and other engineering related items have been completed. The City Council had authorized reduction of the original $105,000 financial guarantee to $25,000 on August 13, 2001. Release of the remaining amount was dependent on replacing a number of dead or dying trees and to assure the viability of required landscaping on the site. These matters have been addressed and the applicant is seeking release of the finaricial guarantee based on the completion of all site work. It is recommended that the City Council authorize release of the remaining $25,000 based on completion of this project. Townhomes (5000 France Avenue North) Planning Commission Application No. 2003-0002 Amount of Guarantee $2,000 (Cash Escrow) Obligor Cross Country Properties, LLC All of the site improvements and conditions for which a performance guarantee was posted have been installed and completed for this 2003 project. The project involved the development of a four unit townhome complex at the northeast corner of SO and France Avenues North. The City Council had authorized reduction of the original $12,000 financial guarantee to $2,000 on October 13, 2003. Release of the remaining amount was dependent on the viability of then recently installed landscaping and their survival through the winter months. This matter has been satisfactorily addressed and the developer is seeking release of the financial guarantee based on the com letion of all site work. p It is recommended that that the City Council authorize release of the remaining $2,000 based on completion of this project. City Council Agenda Item No. 7d Memb r e introduced the following resolution and moved its adoption: RESOLUTION NO. RESOLUTION DECLARING A PUBLIC NUISANCE AND ORDERING THE REMOVAL OF DISEASED TREES WHEREAS, a Notice to Abate Nuisance and Diseased Tree Removal Agreement has been issued to the owners of certain properties in the City of Brooklyn Center giving the owners twenty (20) days to remove diseased trees on the owners' property; and WHEREAS, the City can expedite the removal of these diseased trees by declaring them a public nuisance. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Brooklyn Center,lViinnesota that: 1. The diseased trees at the following addresses are hereby declared to be a public nuisance: PROPERTY OWNER_________________________ PROPERTY ADDRESS________________TREE NUMBER CITY OF BROOKLYN CENTER VAWOUS PARKS 33, 34, 35, 45 EDNA NEWHOUSE 6301 ORCHARD AVE N 36 MARION MCKINLEY 5706 JAMES AVE N 37 LAWRENCE LAVONNE MALIKOWSKI 5509 LOGAN AVE N 38 39 ROY SAARI 5610 KNOX AVE N 40 NORTHPORT PROPERTIES 5401 BROOKLYN BLVD 41 LEE BEVERLY COOK 5341 BROOKLYN BLVD 42 FRED ELIZABETH YARWEH 2330 SS AVE N 43, 44 GLENN AUBRY COLEMAN 5631 HILLSVIEW RD 46 CHRIS BARBARA MCLAUGHLIN 5516 KNOX AVE N 47, 48, 49, 50 RICHARD ARMSTRONG 5602 LOGAN AVE N 51 EDWARD PEGGY LYNN 1912 SS AVE N 52 SUSAN WARNER 5655 HUMBOLDT AVE N 53 STANLEY BERNICE TRUCHINSKI 5633 HUMBOLDT AVE N 54 JOHN CAROLYN HANSON 5610 HUMBOLDT AVE N 55 LEON DINA ROGALLA 5435 BRYANT AVE N 56 CYNTHIA GRANQUIST 5406 COLFAX AVE N 57 JAMES GONZALEZ 5326 BRYANT AVE N 58 DANNIE TOPKA MICHELE MAUS 5738 KNOX AVE N 59 EDWARD DONNA LABERDA 5427 MORGAN AVE N 60 AMIT KIRDATT LEA ANDERSON 5401 MORGAN AVE N 61 BEVERLY NORLANDER 5501 OLIVER AVE N 62 ROBERT MARGO TESSMAN 1900 BROOKVIEW DR 63A TODD DEEANNE HENMNG 1906 BROOKVIEW DR 63B MATTHEW AMY HAWTON 2307 BROOKVIEW DR 64 ERIN CUNNINGHAM 2406 ERICON DR 65 66 WILLIAM DONNA DIRNBERGER 2200 ERICON DR 67 I DEAN SUZANNE MORGAN 3800 ECKBERG DR 68 DREW TERRI KABANUK 5807 DREW AVE N 69 MAI THUNOG NGYUEN 3413 62 AVE N 70 RESOLUTION NO. PROPERTY OWNER PROPERTY ADDRESS TREE NUMBER DUANE FERGUSON 5901 BROOKLYN BLVD 71 JEFFREY DEBORAH IVERSON 3818 COMMODORE DR 72 DAVID JANE JOHNSON 3500 ADMIRAL LANE 73 DANNY JULIE ZIEGLER 5701 EMERSON AVE N 74 MICHELLE MARTIN 1313 57 AVE N 75 76 JOELLE DEAN NORDNESS 5427 KNOX AVE N 77 LARRY TARA ARGUELLO 5344 KNOX AVE N 78 THOMAS MILLER 5331 KNOX AVE N 79 HELEN ZIMMERMAN 3101 66 AVE N 80 CHARLES JORGAN 5501 MORGAN AVE N 81 DALE JOSEFINA SPRICK 5500 MORGAN AVE N 82 NATHANIEL RAMONA TOPLIFF 3907 JANET LANE 83 JEFFREY MEHR 5405 GIRARD AVE N 84 KEVIN LYNETTE SCHERBER 7200 FREMONT AVE N 85 KOUA VANG 6700 FRANCE AVE N 86 LAWRENCE JOHNSON 7036 HALIFAX AVE N 87 DONNA LARSON 5354 NORTHPORT DR 88 CARLOS BAUTISTA/HONORINA RODRIGUEZ 5817 BROOKLYN BLVD 89 WILLIAM HILL b313 ORCHARD AVE N 90 MAURICE BEASLEY 6343 NOBLE AVE N 91 CAROL QUACKENBUSH 5126 TWIN LAKE BLVD EAST 92 ELIZABETH COLLINS 4100 LAKESIDE AVE 93 ORVAL MARLYS HAGE 7215 GIRARD AVE N 94 MICHAEL GALE 3619 URBAN AVE N 95 DAVID CUNNINGHAM 5133 XERXES AVE N 96 KATHLEEN MEGEARS 6736 PERRY AVE N 97 JOHN CATHERINE NOREEN 6813 SCOTT AVE N 98 SAMUEL CHIDINMA NWANEKPE 7067 PERRY AVE N 99 DEWEY KRISTI LEDIN 7200 NOBLE AVE N 100 SYLVESTER AYESHA BOBRAY 6443 NOBLE AVE N 101 CHOU SHANDA YANG 5231 HOWE LANE 102 KATHRYN ENDICOTT 5518 JUDY LANE 103 DARIUSH MAHVAS DANESH 5800 LOGAN AVE N 104 105 HUMBOLDT PROPERTIES 6737 HUMBOLDT AVE N 106 107 HUMBOLDT COURT LLP 6807 HUMBOLDT AVE N 108 109 HUMBOLDT SQUARE ASSOCIATION 6777 HUMBOLDT AVE N 110 JAMES MARTINA CORUM 5517 MORGAN AVE N 111 RALLIE KATHERINE RONDORF 5506 OLIVER AVE N 112 ROBERT MCGOWAN 5512 OLIVER AVE N 113 SARA FLAVIO ABREU 5834 CAMDEN AVE N ll4 HEALTH PARTNERS 6845 LEE AVE N 115 PATRICIA SCARLATO 7215 LEE AVE N 116 MYLEE XIONG CHANG LEE 2100 SS AVE N 117 LEONA RAISCH 2106 SS AVE N 118 CARLA NELSON 6214 LILAC DR N 119 KRIS KUDUK 4938 ZENITH AVE N 120A THOMAS SCHLUETER 4928 ZENITH AVE N 120B JILL DAVID RUSSELL 5013 EWING AVE N 121 EVANS-NORDBY 6000 BROOKLYN BLVD 122 123 SHERRY WOODS 2907 65 AVE N 124A SHIRLEY METZ 2901 65 AVE N 124B RESOLUTION NO. 2. After twenty (20) days from the date of the notice, the property owner(s) will receive a second written notice providing five (5) business days in which to contest the determination of the City Council by requesting, in writing, a hearing. Said request shall be filed with the City Clerk. 3. After five (5) days, if the property owner fails to request a hearing, the tree(s) shall be removed by the City. All removal costs, including legal, financing, and administrative charges, shall be specially assessed against the property. Date Mayor ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. MEMORANDUM DATE: June 23, 2004 TO: Michael J. McCauley, City Manager FROM: Joyce Gulseth, Public Works Administrative Aide SUBJECT: Resolution Declaring a Public Nuisance and Ordering the Removal of Diseased Trees The attached resolution represents the official Council action required to expedite removal of the trees most recently marked b the Cit tree ins ector in accordance with a roved r Y Y P pp p ocedures. It is anhcipated that this resolution will be submitted for council consideration each meeting during the: summer and fall as new trees are marked. City Council Agenda Item No. 7e I 4� BROOKLYN CENTER `l�Y°F IAOUYLYK <i:idt POLICE DEPARTMENT MN MEMORANDUM TO: Michael McCauley, City Manager FROM: Scott Bechthold, Chief of Police DATE: June 22, 2004 SUBJECT: MCD Replacement and Purchase On May 5, 2004, at the LOGIS kick off ineeting for Printrack, staff was told that our current mobile computing devices (MCD's) would be compatible with the new Printrack software with the exception of memory and operating system upgrades. Currently our MCD's operate at a top speed of 300 MHz with a Pentium II processor. As a result, an estimate for theses upgrades was prepared at a total cost of $2690.00. On June 10, 2004, we were informed that the minimum Printrack software specification for MCD's would be a Pentium III class processor operating at minimum of 700 MHz. With this new information, which was validated by Ms. Hartwig, requires the police department to purchase 10 new MCD's by August 1, 2004, in order to meet the August 17, 2004, conversion date to Printrack. The total cost for this purchase will be $44910.00 and is broken down at follows: 10 Panasonic CF-29 mach 2laptop computer $38,000.00 10 Retrofit docking station 360.00 Software upgrade for LOGIS license 1800.00 10 Sprint modems 2000.00 Tax 2740.00 Total 44,910.00 It is my recommendation that forfeiture funds be used to pay for this purchase. City Council Agenda Item No. 8a Member introduced the following resolution and moved its adoption: RESOLUTION NO. RESOLUTION ADOPTING COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE CITY OF BROOKLYN CENTER FOR THE CALENDAR YEAR ENDED DECEMBER 31, 2003 WHEREAS, the City of Brooklyn Center is required by State Statute and City Charter to annually produce financial statements for submission to the Office of the State Auditor by June 30; and WHEREAS, the City of Brooklyn Center is required to provide an auditor's opinion as to the representations in the annual financial statements; and WHEREAS, the attached financial statements have been audited by HLB Tautges Redpath, Ltd. as required; and WHEREAS, HLB Tautges Redpath, Ltd. opined that the general purpose financial statements present fairly, in all material respects, the financial position of the City of Brooklyn Center as of December 31, 2003. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Brooklyn Center that the Comprehensive Annual Financial Report for the City of Brooklyn Center for the calendar year ended December 31, 2003, and all supporting documentation, is hereby adopted as the official financial record for the 2003 fiscal year. June 28, 2004 Date Mayor ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. .:r���::'�� y�,"i rs �t��n �.t. a ��>o \:::.a� t. �::::�t�� ...y v ...:i¢:<::. t C'.F:\ �t\::>.. ,l.a q k!t�\`::: t E ,�''\'�\��..:k\ ::i:.x\b:.: �.::i. ;;��b:3:. .✓AA �;:.:'n 2"���.. v� .v.�.:. +ti.yy:'. t .a� �::::::y::::::.' 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E w«..:.�. .:l�. ,.r. k... \x.. \.:::::i:�a��/,o: u `s::i"� �c.» ....,..o.:� «E. .:.a. .k t\4 ..k ,o£ "l.. �':.nr.i. `�5�.'.. .h :.s \V l .:,..«t:..:...t ...:�:::n.C..n,::..:..: .�.v..�.. ...�U... s.< V....... :c�:: c... ti *>.:::»:°.::x�� ..:a.. f.. ..a... .,\3... t.`�: :<..�i ..t ..,A. ..>.i§:::; f%:. ,./....o,.�... ....t a.�v ...E �>.A a. ...f.. 4; x r.,�,:.:::.,»,...:. �5�` r,. x. ......��...,._s.._� �:..n Com rehensive Annuat p F�nanc�al Re ort GASB 34: The most significant changes to the financial statements are as follows: Government-wide financial statements (Statements 1 and 2 of the Comprehensive Annual Financial Report) are prepared using full accrual accounting for all of the City's activities. Fund Financial Statements (Statements 3 through 8 and the Notes) focus on major funds rather than fund types. Budqetarv comparisons (Statements 9 through 11 for major funds, 20 through 25 for nonmajor funds) include both original and amended budgets. All ca�itaf assets (incfuding streets, trails, etc.) are depreciated on the government- wide financ�al statements. A Manaqement's Discussion and Anal�sis (MD&A) is included in the financial statements. This provides an overview and analysis of the basic financial statements. Member of HLB Infernational 4 t,�� ����C h. z �.rJ�- l 3 �3333431 \\\<�7J„ i .+....�.'..o.�.�r:^;.\�.�i:.. \�a \�i�'.'� :.::::::::::.r ..�.......s.:..........�t`� aa�:a: D:::::\ �',:�x;:: E s J ...tti t..:,� t r >k� :::1�.. 's'./� u.:*,. .1/.:::..» ..o::::. ::1�. o z�� i .:44. �>.:>:::::;::>:H: ,.f�,,, ,:«<y.::.:.:> ��::::><<r. �.::r E .:.y.. r E. E... ,�a.. v.,�!7���� .c. �#.l:r.. .�i,r... t .5. i. .�r t.� .f.... .<a� z:, •c:r w .3.:::.,.:. ,..�5' t w. ...t t v...... 3 ''<rt� :.....:.,.�..c..,t F.. .:r�'� ......i n �;,�N :3. T,^.;; i:;.. �r,.<. �.v iF: �3.:�' h l:;^.:. v ;�n', z•> ..t.. .:a c ��.E...�.. W E.�.:,a��. �..�.+i� \3. y::^ ".:c:a.. t a;r .\t �:�i �z. ,n:.:: /i....: y„ .r...,. E.....<,....., x..... ..��:::..�'�it' E...\ '�:2�.. „a E:......, ,:t.:...>: i*'t::;�? :t'..: �...7 �k. `z��, x �..a ..\.a\��:�:�:\ :rS ��2•\" \t"> ,C�� ^�^\>l��ci?':5:�'>"R '..r a.\. A. \..4�v� A,. .S, v:. �'v.'�. N". 4 4 'n 3 c�•4 ./li,�:. .a'�N<.. a^;b. �r.a o. E ;:r '�ri. `.:1... :::::A:i'�...:� ;e., a::�:x�:., �.f.� t:?F.' �r n..., .��::x.... o ':::.z t..�\ \�,:•�.a :,.tt State Le al Com I�ance g p R r e ot p Re u i red b M i n n esota Statute a y §6.65 OSA estab ished a task force to deve o audit uide for e a p g g com p �ance Audit uide covers six cate ories g g 1) contracting and bidding 2) deposits and investments 3) conflicts of interest 4) public indebtedness 5) claims and disbursement 6) Other miscellaneous provisions No com iance findin s p g I, Memb�r of HLB Ir�ternational 5 �t i :a::� \E`* v x ��\xs' ��fi. v./ �a: :�::t. u�. :'.;A,.;• \u\ .a :u.:: �.::i.. la:.. .w.:�:. .:::y::y:y:y:: a ........:Q.:i:<t:.«t..4:•:.x.. �....`Uf'.. x... ....;::.:.D.::.:::3::::33i'i.`3.::i'..::� a.....»,.»:::^.;.::::: �l?. .a. ...,.::.1......»a� .t...::....�+.. o.t€�.... t i/ E.. \�::>:r:.?::�.::�,;�:::>i.> t.......... i fs... ,C�i� .....,1 ..........t l� �.t ...:::;'•...t::.:r:::::x:i::ixz'..::r` �f. �t. ,.a�. \�z:>::>::><s. .,�r .:�:::.:H i.>:� ���;�.::r;i3�^;,'�\\. c26fa ��a:........R" x:.'l/., `\�\�t.t��. .:i z.' r �a` '\..`.c,�:. t�: c.��.�.:. '\�..:.......::t��a: .::i, l ����s.,�.. E ;.,..s�. �.::n �.s:: �C..:.. �..�.:s<, �\��z.: �,;a ..�.t.��:.. .s..::. .*ro�.�.. :::i� o>�\. ���::/�;..:z\ 3�>: n ��:r /,.'s f t i .:o:, 3 ix.:..:.! �:.Eg a.� ..:r� »\�,:.cr i.�.�,,,:;:z•<:: ,.�'��\..�c �,..5. A: ..c. :.i�, ::s i :t.:..::�..:i<:« i .�ii i �'s ��'?i'��:: �...v. ///..!5 t t _.�.;�t\ s�\\ \a a :::o\.:��.: a t a. c a a t.. ,;�;4;:: �...E.. �.:t,,..� I a.- .1.... t \ti�:c '.'\j?,; l'�v:i� 3'.... \�^y. ;;;.�..v .:';�'.y ::'::'::t.�k ,a:\.\� .�.a ..::n' ....y r...:.::. Jya. ::::i �:::y �.::.k. :o:t: :..K+\::Ga.\\': v/y:..:;. re i �,.x..��.:b..\. �.,w,....: �t'. t �ti. 4 ti:\ 4 4.� \A "�`.��s.« .�i......_, ....:;:,...,�.�.r r ��\��c.. ?��*"�Cc�... .�,�.t, 4 a.> R e ort on Internal Control p Re uired b audit standards a v Based on in uiries and a observations dentifies re ortab e conditions p Re ortab e condition defined as p "significant deficiencies in the design or operation of the internal contro/ over financial reporting that would adversely affect the City's ability to record, process, summarize, and report financial data" no re ortab e conditions noted p Membero# HLB International 6 L�'� I �1�i \\'C�\Q /w i .�n� y \E y „c r� :,��a, :.3 .a�,�:..� T f i ;.�x.. o::\. 3��..:�:<:.. t j:\;.. A ,\,Y��.... ,;:::::y::• Y r.. .::1+. �:::3" ..�...k 3: �'i'� 'r���;/.' �..r: '3'.:, a:+.�`� ::�\\�.t...... .'.v�."'.': �:r twt'..: a.:'�:::.... .f... .ii. .:Yl'�'::�� 9 r.::. r. .«::G�,, c.` ..>.:.,Y �.�s.�...,... i.., �,k i s�. ,.....o:.: fA \�.�....o� �,a. E "��ii�. ..�..'\.....;>.:��:�>:::�z?�:..�.. t�: :r:�:.: �....f ..\.�.:.::..A .t� t w...: ..o.. v.... h. .:..x...�>:.. /.:»z ..a .........1 �YE: xl v43>:>.:: :..�rao..a�`n*,�/,.:.\1.,:.: 1. �\t.✓.. �'v,::s.::/ ;s. >ta�s �Jf.>.�..� �l;i ..:�l..�z .::/�/';"�.o,'�,,,.� vo �c' :::,w P l.✓ l. N .1...... v.�..:::. t.. 1::. \`CB�.�.� �,/.,`R>.c:;.: ..�::s /f.. k.:: I >:.:��::..ti... r �a>.:�..:: .a�:. .r:.� �.th. .x.., .:��ir>>�\ a... r ::::�s� ,,�r.::.:....�..\ r ........a.,:... .:.a�, a;:.�:::�.. ..o t .t o.\ ...t...... ...a �.�1�.�..�.....». �a. �,.,�aca.�.... x.........,.. t:.�: E.,..::.<.`� �,-...�.z...<�..:..::.. s `::/,�:�'f;� 1:... `t�"� .z��\v ...aa�:. ...c �.v.�.:,�:.: z �.,,+c.;r :;:w�.. t �.a5x:�xY�': ::..:.E:t a l it� .::t� ti ri ./!�'x a.. �t a::,:::..... q ,.»�».:.v::.:.v. .l w. '��v �ti :'i �::::i:: ,.1.... ;:`.:�;>y ;t:�,� Y.�. 3�x58 '�`n:�xs :<;\�:�Y `t\\ �3;' Z .:/i....� �.'::>�.�i.ir.i ..,m:, ..:s„�� n. .::::;r:.: a..:, ::.\�iy:.. :Z::� .:�m :a:.� a�, �o"�.f...:!.t. �t i.\ ..:¢�g� �`y'Y.`5 \.�.i;:; 1,.::� \�wJ�� .'+.��,'+'.+"'t4 �,��J' �'+:a y 4 a r:::,,��: :...!�'::i::.:.. t\ .�sF -::::::.;E������.:e:...y::}.::::..... .x\ v t a a a C t .�.�.f 5�..... ..;1���&��':�..�` .w\\ .................�\�.,��`�.a�v"g�.o\ M n a a ement Letter g A fu nds m su mary. Increase Fund Balance (decrease) in (Deficit) Transfets Fund Balance/ Net Assets Fund Revenue Expenditures (Net) Net Assets 12/31/03 General $14,902,910 $12,620,949 ($2,194,655) $87 $8,017,080 Special Reveune: Housing and Redevelopment Authority 207,854 (207,854) Economic Development Authority 37Q984 363,418 207,854 215,420 1,488,766 Earle Brown TIF District 838,056 55,969 (653,000) 129,087 (1,685,368) TIF District No. 3 2,390,004 579,559 (548,000) 1,262,445 6,119,290 TIF' District No. 4 246,968 205,425 41,543 106,765 Police Drug Forfeiture 28,677 13,379 15,298 74,168 CDBG 201,000 201,000 City Initiatives Gxant 482,338 388,991 93,347 107,398 Debt Service: GeneralObligation 300,715 1,036,913 771,937 35,739 4�7,7�4 Tax Increment 10,360 1,987,128 1,201,000 (775,768) 1,436,694 Special Assessment 1,188,592 1,127,556 259,079 320,115 2,976,874 Capital Projects: Capital Reseroe Emergency 31,439 24,356 7,083 1,336,573 CapitalImprovements 139,802 368,047 225,000 (3,2A5) 1,757,730 Municipal State Aid for Construction 145,459 335,609 (190,150) 430,581 Infrastruchue Construction 1,651,877 1,454,747 480,000 677,130 229,179 Eade B[own Heiitage Center Imp:ovements 1,358 93,195 (91,83'n 8,163 Street Reconstmction 252 283,639 283,891 283,891 Technology 275,000 275,000 275,000 Enterprise: Municipal Liquot 3,430,062 3,278,029 (100,000) 52,033 1,218,552 Golf Course 295,450 287,983 7,467 949,312 Earle Brown Heritage Center 3,406,413 3,752,816 (346,403) 9,632,799 Recycling and Refuse 217,747 223,679 (5,932) 93,937 Stieet Light Utility 209,319 147,293 62,026 123,344 Water Utility 1,577,309 1,639,691 (62,382) 1Q517,661 Sanitary Sewer 2,947,464 2,556,224 391,240 10,400,Zb5 Storm Ihainage 1,413,366 834,965 578,401 11,453,075 Internal5ervtce: Central Gazage 1,125,893 1,2A7,662 (121,769) 6,7'75,737 Retirement 25,537 38,615 (13,078) 17,140 Compensated Absences 12,191 26,12A (13,933) 12,191 Total $37,799,396 $34,889,322 $0 $2,91Q074 $75,064,506 I Member pf HLB lnternational 7 L.°� ...::r ./za�� �/c���:::::� .z' ,.;�'r`. »���v�:� \..�..:c:c tt ��'s::7. \t..s.F.:.:! �..t.�. �..�,x. ,'�f;, ,.;5�.�: \\\��F �.d.»�:: ...\.�a.�� ::1...:.. o\ �:o:<., \.i G.. .3\ '�:.t..:.o �?,a ';;?���,�i,:. rt.\ �:,:i ..:/:.n. :..a>. .:./r�.,..:., /y..,....� z. v..::;.:.::.<.���::>::>.< ..,..�.......i�.<...... a -..�t �n s.. a c ,<v ..a�,� a s ..:::::i...\.::,cl�:.::.,. .:/.�.>z:�� �E�:. �`;c. c» t .o:. .a:: ,.c;. i.::. .,......n :o x f:..a: a�3,..���1 ....y...::.:....�.z, 4 -::.a... w g. ����\`...::.:.:.:a:::.>:'>.:::��"���:::�.o.:.i..l;..: :%�""/"i,",'' \\../�<te�< �z.� x. ,;l/,�,�,1// >t <r r �w 4 k. �:f .r�.:.�.::: ....,�,.�:��,z. ,:s�.., ..w� h I� r... o. ..f:<. v��/+�R' �'���\�t`\t..^� d.l'::: >::.�`u a l+' E :.:E �::3::: «::�:':""..Y.. 'Y/,/. ..5,... ����:a' �_,...c;�'�"" +`�:�':>�:::::'z::i8�' �;.i ::i'\ t.. �o.�.�^+.. 9. :;:i:., ',l/.. n ?,'.;a'�. y 4 4 E� �.....3/.. :;.�:A ;....:.:.:..;,x,. :::.::9i..:,..,... :,:E«. x ���z,. :e .�S t. R.:.. �^:�d� .....a.. ;..,..:s.:.*. z.. L s. :.;:a f �a:::a,,,�>`� C \`..t.':C���3>: ..:��'3..t ��'.z: os ..:1 \\\\�.\i��. .�`0'2:§ ..a; �.�N n .t,� f,:. �A:a. :c� .M. 4`��.�: o::..,. tt� r \.:..n.... �rr.,, ,.�������;,...E i' �z...11l M n a a ement Letter g Genera F n ud Fund balance increased $87,000 during 2003. Budget Actual Variance Revenue $15,408,271 $14,902,910 ($505,361) Expenditures 14,543,861 13,228,170 1,315,691 Increase (decrease) before other financing souroes 864,410 1,674,740 810,330 Other financing sources (uses): Transfers from other funds 784,084 607,221 (176,863) Transfers to other funds (1,648,494) (2,194,655) (546,161) Increase (decrease) in General Fund balance $0 $87,306 $87,306 Revenue budget variances are as fo I I ows o�er (LTnder) Budget Property taYes $261,600 Licenses and permits 214,965 Intergovernmental (1,050,728) All other 68,802 Total ($505,361) Member of' HLB Irrternatianai 8 �t .»c �,s 3� t \�.�3.:.....:.,,.:: �y,::< ::y» t�.. �.�...3.. �,2.. 4 \\\i. i;.�l ��l \..E\\ a .:'.yr E:::.j:."�::a': a.. Y �..,�.t. cr �y. .1:: �'a..: �:.��.:�s i�: �..�::.:.:c•. ..C�z.. ,.,3... .u... �a\.. »»�...�::�.e:::o 4.��„ s:w.: „\�E:: .:.l,l�t,\.o c.�. e'< t. .�Y::. C�E t:..: :.x.:i <:z:��� ..�::o:::.::.: 4 z:;a:. ..A.. .0,.. x.\.. "WV1' f a �.:a. a:: .i: a ...,��mx.u.. ..........1.. ..o.� .^"o:r:.. .�V.... fE..... :t !/if. a.:.... ....:�:::t....:t:.:.:::>'.�t. ..:*.u. jA .t t.... ..n:::::.�::....:::.. ....x:::.:t.�.. �°.5.,, ...m.. 4.:� \,.a� ,.a>:.;;;:� k. .,..n ��.w;.,;::;�� ..x.. .::>:......::.W.,.., ..:::::::.1 ..nzax .,a*.�.\. ....�1. 1... ..a... U�,.' ..a...a :r::i':.:::::.:..» ......:...,,.a, V:.:::.::. 1..... t...::::: 1...... :.n. �.n a.-: l%'% ........\�........n....... \...,..19 .......�4 ...u.l �t 3 'i�' l .t x. ':�..»,/l `�,i� n f.. l. .ti.. y ��,ti�.:w.,:,< �i_........ a:, v \.1 ?::Ji.'1.::'..::.� .a.a.s:r;l� c:ti� c �.::.t .:/c .�t...:.,.�� �.��':i t \�::1 �a: ..l ::::::::::..E...::.� u.::,:.v.::.. ..f� `�,<.aa:� :w �.,:::1'f.: ..�1,//, sx,w« a"� ...3\\. 4 ,a; «:ti.:. .r. �o- azi::i:::>'i'i% vC:;; x ..:::...a:�i* >.::�A: :r¢ o ti9 l ::....a »v::: <t�:�� 3 �.::::a�. ,\p. �.:..:�..i:.. a\ .:a.:::;:::::::>::>::>::>;.::>::::::>::z.:. f:�..�'..�.y... :_.<::.h,:.:: t �,.ri.:. a._ :.d .�..E`:� i�>' .o�.. t Y \...::.::..t .a l:.'.::>::>::>::s::r ��:x� �»:�i... �:.x��; :..,3. „t .t\. .:.�w ::.>:o::.< u.. �\�:�;::::.;::::,>..<:::�::>::>o:>:.\��. /�.>:.:a. .:�.�.�::.,..,:..a .�z.� x�. %J'w ...t. «w................... \\Ct �F o..�:::,,, ..::.:::t :<:..o...�f:�\,...�..........,n::.: E .a:::: .......o�� °�».,..1/i... �""iY' y N ,..�a� �i� M n a a ement Letter g Fund balance at December 31, 2003 was $8, 017, 000 General Fund Balance Component 12/31/2001 12/31/2002 12/31/2003 Reserved for advances to other funds $105,074 $105,074 $105,074 Designated for working capital 6,437,653 6,527,973 6,031,077 Subtotal 6,542,727 6,633,047 6,136,151 Reserved for prepaids 68,279 5,309 Undesignated 891,145 1,228,448 1,875,620 Total $7,433,872 $7,929,774 $8,017,080 Working Capital Reserve 2001 2002 2003 1. Items not readily convertible to cash: a. Accounts receivable $67,160 $53,489 $57,908 b. Advances to otha funds 105,074 105,074 105,074 c. Restricted assets 131,153 2. Amount appropriated to the ensuing year's budget 19,305 3. Amounts reserved to wvrldng capital (45% of current yeaz budget less debt service) 6,351,188 6,474,484 5,842,016 $6,542,727 $6,633,047 $6,136,151 Member of HLB Internatianal ��r� L�� g 4 ��,r� c �i. �\r., c..�/l/.'�' x :b. Y#� �:o.� '�'a': ,....:::::.s �i. ":':i' �„t:..; j 1.�,: 331:i "R.AA ��«�x�; �.,o���, t::..:..::: v...... »...,.a.:.:, a I E�� �.�,::r>:. :.f:.::. s.:. a� A ::.:.w:: >'s:::» �,���.�.4 �:;z; W.�.��. s.:.;,. ,4.. �.,,,,,:a,>,�. w...»,����� v.�.: n 4 4: �a.�: i.. t ..n ..s:.. .r :..E it� 3�`:�::... ..:���>AO:* �i z`�\' x �'v<z:�:�.:: x.� "t�: ;;ya. b. o:.; ���.�o t.. �3:�\ \�\E:'.:� '�i2� -::S��a. �.cj. �'�:£.<a..\ /l�:f,��;-i.+.c,�:*,� I I I �c: �.:3:���� �\,n o-r.���„:..., s. E..... �,..1.,.::::. ....:.c. r ...:,,v::.:. .f s. .<.:n'.:< Za. v,..tE� o. »7.:. .a.:.a t,.. .5..... z.. ,a .:...:a.:�.:.�::i;:: M 1..� x a.;aC .:c 7...�... .,.�s. ^t :::.�a_::1.. ...,....a ..::::::.::.�:.:.,.:::::.o:::.:v..o::>:�:Yn �\,.4Y�. :...�.....t..... a..... �.`.sl... E r::...... E t. :.:a .....E �.E.. ::..:o:.�:..:�:�::::�;.::»:::>:� �::..:>,.:.:....v .a,.. ..Y�:z:::.. a,a w .0 :t Y\ A,.��� t f.:\'.• :.E\.C. ;'G �.l '�;�E. a..A .:�'�'a ..s....... i. E t.v�:< y:y::;':� .:,�'.'n l 5 3�� .........E\ E. �C/. <.....C:'.,- o u)... .j.'..\�.\� .l. .r;,....:...E. a.::: .v:.::e..,`:..;ax ..t O..E....` t. a l ,.�:a..:.�� �..�'i/i,� .:,��.:::...::a I I ,..n.� ��t.���.,....... ..:t. ..<..��'.�G''�E?.lA �n*�aca*�a. I M ana ement Letter g The current fund balance policy addresses working capital. Cities may have additional fund balance reserve needs. Examples include Intergovernmental revenue cutbacks Emergency or unanticipated expenditures Special projects Capital outlay replacement We suggest the City review it's current li n t rmin if o c a d de e e p Y add itional reserves are appropriate. fVC�mber of HLB International r \A.. ....i.�,l �C \\'Ci:::i^ t .:art.� .x.::�ii::i:y:;��\ v.. �:..,y....0. s *,4. +Q�� :::.r a t.. '�r. ...""t:°d�..\\\ \>.i :�c. :.1 \:a;::«;:,,:< x.. c. �<t w;; z,�;:.;;` �c....,.....� .s. n.�. W,�. v�.� �c,> A .:.::::>:::»s:.>::::::: \::a i. ��..,t E x� n.. .::.w .,..�,�4fn:> __........:;::A��t \v,:..: �..::.::c ,.;.v. x<�... E ..,\,..�\\\:.\tt <s:e:#> w.»,,. �E �4 �......,.r. t ..:.,..v F.:�>;,>;`:�:`:: \:���;\,a .h� ss. x. 'm>,:.... .....::.:::.:.v. .»....,_::::::.k:�i;;:� ..ff� x........ ..w/. ::i�. ✓l. .c� ..c w a z��< z z:..:: ��..E :.�..§a. :z.:...� :45:::�:::...::. ���e ;v;,.: :.:.h .;k: r. 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S vC..�'.�. �:....e�.:. \<,.3. .3:..... ....,3 ......::.:...t...a c'���� �'»�i'�:::1k€� �:.�..E..�,..:. a.�:.. o t.... �a.: c.>. �:::.r.i:�::...: .t. 5 t...: ..o:.:�:,, z.:�:gr::. ......::......ai...... �::>::`:i:'s::»... t t �:..z:»:. t ....:.ff /c> .,...n.t ,,«,.\\.::,..:._.._::.o::...::.:........ �t� \,.::.a A�_...... ...�:;:::::::::o::>:zS;> ..�1 .t.c.� «.:..::::y...:::s:i� a>..... ��.5..,::. __<:.....a��.�. ..�i�,<�> M r ana ement Lette g S ecia Revenue Funds: Fund Balance (Deficit) December 31, Increase Fund 2002 2003 (Decrease) Housing and Redevelopment Authority Economic Development Authority 1,273,346 1,488,766 215,420 Earle Brown TIF (1,814,455) (1,685,368) 129,087 TIF District No. 3 4,856,845 6,119,290 1,262,445 TIF District No. 4 65,222 106,765 41,543 Police and Drug Forfeiture 58,870 74,168 15,298 CDBG City Initiatives Grant 14,051 107,398 93,347 Totals $4,453,879 $6,211,019 $1,757,140 Member of HLB Ir�ternational 1 1 ..a�:::::%Y \:a; �c r ..�������������v.i:::.:: Ak.\\��, t ...:�.c ::.ii;' x ��E\... �i'A... .........::::.�:.�:r.n: :.:t. .:...:.:::..t u:: t. /l.:,� v.v' .Et ::::...:.::.�<.:::::.�.Y��`G.:.a\::::.: ��.,:::,�.:::::E..:::.:.:.:��...........at.^,...:..... �:.,::::tc\\ .�..,.:::;:;+.,..�,%lEt\�`.�. \:`::i:: .::::,::::..�E� n ��.s..... „2�9c./...:o 9. ��'fi�::� f.� ....._.....�,t,:::::,:::,:„.:�s: .::......:...�:.::�..:..�:.:�•:;;v.�:.;•::::: t .,...,.%�:.:.:>.:;.o.�'#t��.�\ o o:.::. .............t....�.�::. f.. o..> A.:: y,f.. a:�, .:�c.• W l u::::.:�: «�.t\\ .l� .E����� .r.�>: i;�l" ..,.,a�\\;; E �ka �.t ��c ��,a �.,a...�: x�..::..:,,. ::..:.::a.-::,:.,:................::::.>..:>:::.....\. ��i 9 �.::�:::::�..r�;y:y:.:.:..�::.. .:;'t���,-� �y.\+�;. L tttt ;1�.::. c:. 4 �:.:;;;r::. .'a.. v.}...::.. tt. t\..at. >:.:a���� .....1 .....�....::.::.i+ �t. x..t� ,..,:;:.:.,.\...t..t .....,..ti �\��b.E..,...;:i::::;::5:. s::lr.: \u,.'S:. ......wt. t li ...:....a......... t ,1.: `y> a.. ��;?3% ...E ..l �1. Ya' :�r,�. w...:::. x..... .L�. ���:z< "\:\r? .h �:\\��,a\� .t.. p �C'. �ct .:1: .,l.l�. h :::il ��'S\�. t. ....t �.w,..G.. t. .l .a..:r.:�.g.' :::::..:::::.t:: l� .:x ..1� 4 k /�:.:;"'w�...�� t.� \.x;� :..1, ..b\, w}5,..: s y. \w:. ��i' 'C;�;: �P.. ,...a..... ..�,..��Fr,... ,.?c� .�r..,�..���_...,,. .t......» �l ...v.. .r� ..�.�U ..................!f�. u,. c .............w..::,.�: .........t t<� x�k`,: �a\� .:...:...o::.:.::.:......«.. r..,^.,.�,�. �...::».::::....::::f:...;'.. t ......:..:..t.. �:.:3t...::::.: x.�\�. :l \�:...:ta:. 'C.:....a..>..s:.... r'.a.i'�� .a .`3.:....:::....::,::,� •t>.�:< a�:..::::::.:...... ..a.::.:.,.:� ,..,.r..,:;:,., ../i ;'s: �:.:...>:.t \�<...a �<..�.:.o-:o... .f. :�:,.::.�E.\. 't'�^.::>;>�.. a�. ,�I z>.>:. :�a„ ,..s:>:::... \""\`�.:,a�\ .:.::::::.:.a;..\.:::. �.::.,.��..:....:::v:......::\ n•:;:.:;;:::.. �.,,.:::..s 'c::>z>.:.��> a....�...��.,�...�.,� /1 r t�...�»�. ,r.. �t�.:a�� t t�:..:� M ana ement Letter g S ecia Revenue Funds: Housinq� and Redevelo�ment Authorit� fund Property tax revenue of $208,000 Transfer to EDA of $208,000 TI F District #2 Earl Brown Farm TI F fu nd Deficit fund balance at December 31, 2003 of $1, 685, 000 Anticipated future tax increment collections will finance the deficit Member of HLB Internatiana� 12 �tt�'� F »r �:.�:i.�:..:E.����d.r r �\.3�C �a:;.. *4?.�t.\\: �s ;:l �'::..k. n n: �A �ia;:i?'� i:� �N� f .3`?. a `��::i':'::�, .z.:�:..a t:::.+\.*„ ..::::�.a:r ��\.y. ,.,..,:.::::»..��«.::...1�.. 9 t\.:::::::'.::>:.>.:z«c .t:..... .:Y:a`. <..':.-,c:: Y� /r n' 3" \�.:::�.:::.::a::<��:�'" .::,.a. ...,,,.».:.�,o:t..f.... ....,\.:».�..:.::.a.� ��.r ,4�„ ::s:z;.:e. tE�_ :..a... '::'l:i`a:\.t. :'a\.:i ��t.: t...... ......::t :::1... �`5°..>...:.::: ..:........:..1:.. ...::���1 �4.. f; ��:.r f .,.e:...::::.. .a.,:..,.::. t �»1.... .::1 x f,.. .../o r...._..... n �z:. �r...:: ...a\.......... .1..... t?:�t a_ ,.a_.. w /t/.. k..F:::::.. a" a z?;,:::: ..�:<.:c�a t �E�\:� .J�.. ..a.x. ,l.,+F.:<` ��'a:X.+..' �:o....Yll: a ,.�:c.::::::. ...<h .f<.,� ..,x. ..1: ......:.....t �3. 1::.;;:e: .�+a... v'::\<\ia ,...:..E... ...::n. ..A� *,a.�.*"* a "::�y"� �v..t�......» F ..:s... ..:nl W�> w:..:::::, R..x�.. a �����,�t: ...�s.. ,.r....... 3..........,,. ..r ��<:v.:�., E� �i<. z::::., :.x ..7 �o� t�: ::i:✓�,�.� �.�:.1. "/�.1/./ �r:�� ....+..��.,cx.. ::f�t:: ;:>C,o �.:�s: ..df'. ,.e.o. �z.��� ..:i. ::Y:: .:�a ��,��xsp,*„ il/ .::�.o�. a ,e�'t: �.v ..:�a ..;v f r�, ...Y \�\...r. E 2., .:�d ./i c^. .:.c. ...��?l.3'<� ..a,.:::..� s 9 ..J..::::::....> r t.«.: ,k r .a E .//,C.,,�\.,..I ,,.„E ,.c.: <t .:.:a.:::::..t .\.t:.::«:«:>�.t.\.:.: ...�..::::.��i ..�c. ,:.*`:i:..... .x ���...�.....-_.�\\.Ett�...__..,..<.:.::. ..,..:::.....G/%/�'/�:.,,.,.,.:::t.;.;....�..t.,:_.,���������`,,\.�........... `...a n M ana ement Letter g Debt Service F n u ds. 13 bond issues outstanding: Assets PleAqed for Debt Retirement 12/31/2003 Se6eduleA Final Fund Deferzed Outstandiug Property Mahuity Fund Dcseriolion Balance Revenue� Totals Princinal Ta�ces Date Ta�c Ineremeut Debt: Tas Increment Bonds of 1991 (TIF 2) $592,398 �592,398 $1,425,000 02/Dl/04 Refunding Ta�c Iucremen[ Bouds of 1992 (TIF 2) 263,027 263,027 02/01/03 Tazable Tar Incremeut Bonds of 1995 (TIF 3) 581,269 581,269 3,080,000 02/Ol/11 Total [ax inerement debt 1,436,694 0 1,436,694 4,505,000 0 Special Assessment Debt: Street Improvement Bonds of 1994 (301) 178,007 11,362 189,369 185,000 69,536 02/Ol/OS Street Improvement Bonds of 1995 (302) 119,090 22,880 141,970 260,000 144,621 02/Ol/06 Street Improvemeut Bonds of 1996 (303) 464,764 139,803 604,567 620,000 359,236 02/Ol/07 Strect Lnprovement Bonds of 1997 (304) 243,781 253,682 497,463 S1Q000 02/Ol/OS Street Improvemeut Bonds of 1998 (307) 420,390 308,435 725,825 615,000 02{Ol/09 Street Improvemeut Bonds of 1999 (308) 421,874 721,175 1,143,049 1,090,000 02/Ol/10 Strect Improvement Bonds of 2000 (309) 516,839 350,895 567,734 575,000 02(Ol/11 Strect Improvement Bonds of 2001 (310) 356,881 403,542 760,423 645,000 02/Ol(12 Street Improvemeut Bonds of 2003 (311) 255,248 890,740 1,145,988 1,205,000 02/Ol/13 Total special assessment debt 2,976,874 3,102,514 6,079,358 5,705,000 573,393 Creneral Obligation Debt: Refunding State-Aid Street Bonds (306) 845,000 04/Ol/06 Police aud Fire Building Bouds (305) 907,709 3Q789 938,498 S,S75,000 02/Ol/13 Total general obliga[ion debt 907,709 30,789 938,498 6,720,000 0 Total All Debt Servicc Funds $5,321,277 $3,133,303 $5,454,580 $16,93Q000 $573,393 Future tax increment amounts subject to valuation and tas capacity rate IIuctuatioas. Deferred revenue primarily c of uncollected soecial assessments. Member of HLQ International m �U�.._ r{ I.� x r i w s�s �tt :YGI+.�.,�aa,.,.�,.,. t\ _...:::��ll A i�.\y)},. �H x.a..... i�'...: �j..� t\\. «:.a� \.j .a ...h. :::::t :4 �?kc,..\..: `�,..:,�::;:z..\�..'�.`#::>:` ..1..::.: a... �i �:�:.:,c:.,; e ati ...R`l\... �,.4./..:::�tii... ..E..x...:..., l .Q.l l ..U. �..�:...r.:::: E.,S' �E ..a... ...E.a. u..v..:. 3 e..:. .E� .,z :,,-.t.... :�;::�.::a:.o����� ..s i �a...:: n�' .:c .J�`�.�.,,,,,�,�„o_..... ..C>?.�� �r..r x �::...�::.Y��*�.�.....�:.:.� ��y :�...�h....:n� a E A:l. .....w.:: t ..�......:.:.:1 »c �..`.E.z`.<:?i;:.�:":::� `a. :.r.�.,�,� l,'.rt� «:..::»�///i.::A::.F...... .i ..f..... �"��^�':t'<r':: i.::.. v/ ....:.:a„C.. .,`.�1:::. S. r.:::.... t �F.... \,.E. ..y t`.. .�.E<.:>.. t .v.. t ..to: ::....::.+1� Y.::., ..,.:.:.�v::.Vl \�..:.:a. .C r?... w "c,»,,, .«s... ,r h <.>....�.....:::,.......»r...�°�.�� \�a. n�. ...f.. C... �;:.:,\\\D .�.....a 3 a., a.�. 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A comparison of fund balance of all Capital Project Funds is as follows: Fund Balance (Deficit) December 31, Increase/ Fund 2002 2003 (Decrease) Capital Reserve Emergency $1,329,490 $1,336,573 $7,083 CapitalImprovements 1,760,975 1,75'7,730 (3,245) Municipal State Aid for Construction 620,731 430,581 (190,150) Infrastructure Construction (447,951) 229,179 677,130 Earle Brown Heritage Center Improvements 100,000 8,163 (91,837) Street Reconstruction 283,891 283,891 Technology 275,000 275,000 Totals $3,363,245 $4,321,117 $957,872 Member of HLB Irrternatianal 4 ;>:.�.i �s'// �r:: ;:a.. .l 9....� ,�.M`�.�,'v`,. q ::c �A l .y� t .....::.....:p: p :J�\. ti:� ..��i v i:'.: .+h� .kk%'k w.::.. t r. t•: vy::.4:. ...a`:'� .::1.. .�.1.. .:i J a �.c a 'bS.:: ��L:: •...:::.t:..... n:::.: cS.i:i:`::::w: ».a.. a.:`v::: .t..: ....0 1......:..� t �'E .Q.. �Q.... a...... ::.y:::i .:......t .v. .......E... yt.. t..::::::;.::'.'.:'': l ti: �j• l d ..e i k:�3.x+.A: �G :::tt.' �`>%i ..Y:�' '�i�'�.�'. \\'�.n:: o:.:��� -�2a .:.,a�� .,,,..:..,f �.n�" :/v:�.� rt :i. .*:r. .�.::::r l'�:: ox .1::..' l... ................:.:::r�:. ��:::::r: t Ar, �l {G t t t«.::fi..::.. 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S:?'�" F 1.. �F:. ,r�,'�..... .::::.3 .,>�*f,.`,';.... ��ir�...... .....t....... ,.a ._.':'.=:::>o:z:::.. o a,` 7" a a::::..::.: a,� .t. ..�.t ,...i......��...\ .l%/ .:;....:...y;:.�t .....k ........E .........v..».. ...s �.......i..v. t :..::.n..n...::::..::: .wE ._...Y..»...........�* ........h l ._����_......�ao'l\\\.....,_..../..>.\\\��\\� 8..�,:.::.��\a an r a emen e e Enter rise Funds: Eazle Brown i: Golf Heritage Sanitazy Storm Street Liquor Course Center Water Sewer Drainage Refuse Iaght Cash flows fromoperations $280,000 $38,000 $172,000 $628,000 $848,000 $1,115,000 ($9,000) $48,000 Transfer out/repayment of advance (100,000) (15,000) Capital asset acquisitions (310,000) (417,000) (323,000) Debt service (236,000) Investment income 15,000 1,000 17,000 31,000 26,000 14,000 2,000 1,000 Net increase in cash 195,000 24,000 189,000 349,000 457,000 570,000 (7,000) 49,000 Cash balance January 1 802,000 37,000 666,000 1,541,000 682,OOf1 343,000 54,000 30,000 Cash balance December 31 $997,000 $61,000 $855,000 $1,890,000 $1,139,000 $913,000 $47,000 $79,000 Member of HLE� Ir�ternational j 5 1�� t ».a, .....E. 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E��:..\ �\\�.t a::.. ...�.o....���.\. .....w'.°x` r .4.:-...:..� ;�%�'".?E\.�a n.:,;;e�::. �i L �i:. t c.�... `�l 3 �E 'N.r....�.. a �.>i'�5 o.. .>,a..... r,,.. ...t .�s:r�i%�� /i�,.,,� �:�.�Y::�� am m r a e e e e nterna Service Fu nds: Internal Service Funds Cash and Investment Balance December 31, Fund 2001 2002 2003 Compensated Absences $733,221 $741,038 $795,418 Retirement (Post Employment Insurance Benefits) 1,543,554 1,574,666 1,564,375 Central Garage 4,089,161 4,198,486 4,541,395 Total $6,365,936 $6,514,190 $6,901,188 Member of HLB lnternationai s I ;,,.,.yl i'E�\��^ f" ;;xn .��au, c l�/' �a���� ..:.t y� t k �l `°a <'!3 �\\`�,x,...x««, ....tt.EE.....>.,��<,\ .�.'.'x*\.L� rti.c�.� :t f�,: '`v�� ��'��R; c.w ;4;:?; xay:: tr ,�,:.i::i::: ;..;::>>:>?::t�a.... a t r>;, r. a.> ..1... ::.r :;?z:�::<..:::: Y:;::�'\ 44 <\a v \�l a...:. �...r:.<:. .ii.. ,�„X ,k�'..,.`. h a«a�.. l a..� E: �':x.:::i:?. .�a:: s *e::i �r �.:a;....:::%�a. o:: �:.,r ...s: a ::...t.... s�, 4. <����s'<..: 4;;:,.,..... �\oc,.. .s.: -_:.;:.;:.:.:n:. .,>.a..:::..�. r.:: :•.::�ry a r �.:.7�. s:"> ,..r.. �i: \..i...,.. ,:;:::>�>:.e\... a E... _.a iE .�v ..,..J�,*�.:�o>;\.:: ::.�:.s. .v..:::.� s�. ,:.:,,.r:::: a O. t �.�::.\Y,�.� ��:�1`" .a::\ C�ti.�., a:: �:;�tE.:,..�c.t.�;a�� \\...,r/ >;:�.��::::r.t f� ..�:a.::�o ::.:��t .......z ...o�, ..li :..l:::ii� .;',l.l r.::.a�...:.:� ...,..:::�.::...r..: �:....t...f. ....,«�:..�a��,...,.....�:, .,.....�.i.,\\� \�'��v':�' .f :a:� �y�. -s. c o.. ..::..�......:::.a. i...o n�? .5��... ..,..\...R. i.� Y+l ^:{:J"v":� \\u �A�...�... \...::.t:�..:.�.:. :::.t �n..::... ..a.. v,`:..:ao;t.:: ,1..4:�i��::::;::t.� �+y ..a...:: ..:y:.�:< v....:.:v ..n....:....:.:.. a;:.':.::1:' a)'' ,.::::/i,..,.... a:,.... u:: E..... s \\o <i.v:�s \\<::::>a w> :.a. E .s*. --.....��R.`..:. a.: �v ..a.ii:::�:w�\� "s:t :.:...��.,.....•r.. ,y.:..<so' ..;a�\\ �'a�� >:.<::,::..4.::..:. �:��i���. .a� c...... w: tE<<� .t�`.. �k f..., Yn .'l•.y Au a.. .\.:..a. u.. a... a.�. q...\ *y: ..�i y: ....:y..a ..:_..-t�,� f.::�:�;:ki::i'::t y �l'F.: \_..�:...\.�.'t'....�.�.....,.,:/ ..:::.:..�....�..:a� ,.>.:::.�a. .a::..\�a".:.�: .;,\\��.:><a:�.::.::.::.::.a ...��.*'�c .��n....._��-- ,..�3.... M ana ement Letter g nterfu nd �oans: Two types Advances to Other Funds Due to Other Funds Advances to other funds: Fund Receivable Payable General Fund $105,074 MSA Construction Fund 593,069 Earle Brown TIF Fund 698,143 Capital Improvements Fund 885,000 Golf Course Fund 885,000 Capital Reserve Emergency Fund 709,969 Infrastructure Construction Fund 709,969 Total $2,293,112 $2,293,112 Due to other funds: Receivable Payable Tas Increment No. 3 Fund $1,043,323 Earle Brown Farm TIF Fund 1,043,323 Capita] Reserve Emergency Fund 158,933 MSA for Construction Fund 158,933 Total $1,202,256 $1,202,256 Statutory requirements when TIF funds involved Mernber of HLB Infernational s �7 COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE CITY OF BROOKLYN CENTER, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2003 THE FINANCE DEPARTMENT Daniel Jordet, Director of Fiscal and Support Services l 1 (Member of Government Finance Officers Association of the United States and Canada) CITY OF BROOKLYN CENTER MINNESOTA TABLE OF CONTENTS I Page Reference No. I. INTRODUCTORY SECTION Letter of Transmittal 3 Certificate of Achievement 9 PrincipalOfficiais 11 Organization Chart 13 i II. FINANCIAL SECTION Independent Auditor's Report 1 Management's Discussion and Anatysis Z1 Basic Financial Statements: Government-Wide Financial Statements: Statement of Net Assets Statement 1 35 Statement of Activities Statement 2 36 Fund Financial Statements Balance Sheet Governmental Funds Statement 3 38 Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds Statement 4 40 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds Statement 5 43 I Statement of Net Assets Proprietary Funds Statement 6 44 Statement of Revenues, Expenses, and Changes in Fund Net Assets Proprietary Funds Statement 7 46 Statement of Cash Flows Proprietary Funds Statement 8 48 Notes to Financial Statements 51 Required Supplementary Information: Budgetary Comparison Schedule Genera( Fund Statement 9 84 I Bud eta Com arison Schedule Earl Brown g rY P Tax Increment District Statement 10 90 Budgetary Comparison Schedule Tax Increment District No. 3 Statement ll 91 Budgetary Comparison Schedule Note to RSI 92 CITY OF BROOKLYN CENTER, MINNESOTA TABLE OF CONTENTS Page Reference No. Combining and Individual Fund Statements and Schedules: Combining Balance Sheet Nonmajor Governmental Funds Statement 12 99 Combining Statement of Revenues, Expenditures and Changes in Fund Balance Nonmajor Governmental Funds Statement 13 100 Subcombining Balance Sheet Nonmajor Special Revenue Funds Statement 14 103 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Special Revenue Funds Statement 1� 104 Subcombining Balance Sheet Nonmajor Debt Service Funds Statement 16 1�8 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Debt Service Funds Statement 17 109 Subcombining Balance Sheet Nonmajor Capital Project Funds Statement 18 112 Subcombining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Capital Project Funds Statement 19 114 Special Revenue Funds: Schedules of Revenues, Expenditures and Changes in Fund Balances Budget and ActuaL• Housing and Redevelopment Authority Fund Statement 20 116 Economic Development Authority Fund Statement 21 117 Tax Increment District No. 4 Fund Statement 22 118 Police Drug Forfeiture Fund Statement 23 119 Community Development Block Grant Fund Statement 24 120 City Initiatives Grant Fund Statement 25 121 Subcombining Statement of Net Assets Nonmajor Enterprise Funds Statement 26 124 Subcombining Statement of Revenues, Expenses, and Changes in Fund Net Assets Nonmajor Enterprise Funds Statement 27 125 Subcombining Statement of Cash Flows Nonmajor Enterprise Funds Statement 28 126 Subcombining Statement of Net Assets Internal Service Funds Statement 29 128 Subcombining Statement of Revenues, Expenses, and Changes in Fund Net Assets Internal Service Funds Statement 30 129 Subcombining Statement of Cash Flows Internal Service Funds Statement 31 130 Capital Assets Used in the Operation of Governmental Funds Schedule By Source Statement 32 132 Schedule By Function and Activity Statement 33 133 Schedule of Changes By Function and Activity Statement 34 134 CITY OF BROOKLYN CENTER, MINNESOTA TABLE OF CONTENTS Page Reference No. III. STATISTICAL SECTION (UNAUDITED) 1 Government-Wide Information: Government-Wide Expenses By Function Table 1 136 Government-Wide Revenues Table 2 138 Fund Information: General Govermental Expenditures by Function Last Ten Fiscal Years Table 3 140 General Governmental Revenues and Other Financing Sources by Source Last Ten Fiscal Years Table 4 141 Special Assessment Billings and Colleciions Last Ten Fiscal Years Table 5 142 Computation of Legal Debt Margin Table 6 143 Ratio of Annual Debt Service Expenditures for General Bonded Debt to Total General Expenditures Last Ten Fiscal Years Table 7 145 Miscellaneous Statistical Data Table 8 146 Tax Levies and Tax Collections Last Ten Fiscal Years Table 9 149 Assessed Value and Estimated Market Value of All Taxable Property Table 10 150 Last Ten Fiscal Years Direct and Overlapping Tax Rates (Per $1,000) and Tax Levies Last Ten Fiscal Years Table 11 1�2 Ratio of Net Bonded Debt to Assessed Value and Net Bonded Debt Per Capita Last Ten Fiscal Years Table 12 154 Computation of Direct and Overlapping Debt Table 13 155 Princi al Tax a ers P P Y Table 14 156 Property Value and Construction Last Ten Fisca] Years Tab(e 1� 157 Demographic Statistics Last Ten Fiscal Years Table 16 1�8 Schedule of Revenue Bond Coverage Last Ten Fiscal Years Table 17 159 Schedule of Insurance Coverage Tabie 18 160 i 1 i I. INTRODUCTORY SECTION 1 i 1 1 L 1 1 1 This page intent+onatly left blank e 2 I City of Brooklyn Center A Millennium Community I June 15 2004 Honorable Mayor and Nlembers of the City Counci( City of Broo�:lyn Center Transmitted herewith is the Comprehensive Annual Financiai Report of the City of Brooklyn Center for the fiscal year ended December 31, 2003. Minnesota Statutes and City Charter Section 7.12 rec�uire that the tinancial statements of the City of Brooklyn Center be audited by the State Auditor or a certitied public accountant selected by the City CounciL These tinancial statements have been audited by HLB Tautges Redpath, Ltd. Their report is included in the tinancial section of this report. In addition, HLB Tautges Redpath is required to issue an opinion on the City's mana�ement and accounting for ;rant funds from the federal �overnment. This "Single Audit" opinion is designed to meet the monitoring needs of federal grantor agencies. That report is isstied in a separate letter. Protile of the City of Brooklyn Center The City of Brookfyn Ceater was incorporated in 19t 1 and is located in northern Hennepin County. The City has operated under the council-manager form of government since the adoption of the City Charter in 1966. The governing body is comprised of the Mayor and four Council M.embers e(ected at large. A(1 members serve four-year terms with trvo of the Council Ntembers standin� For election durinb each national e(ection year cycle. The M1yor and Council ivlembers hire the City Manager who runs the daily e operations of the C ity. The City of Brooklyn Center provides a fiil( range of municipa( services to its citizens. These include police and fire protection services, zoning enforcement, municipal planning, parks and recreation activities, construction and maintenance of streets, provision of �vater, sanitary sewer, storm�vater and street lighting utilities. Community and economic deve�opment are facilitated through a Housin; and Redevelopment Authority and an Economic Development Authority. The City also has internal departments providin� human resources, engineerin�, financial management and information technofogy support to these various functions. The City operates a conference and meetin� facility at the Earle Brotivn Heritage Center, municipal liquor, and a 9 hole golf course. 6301 Shingle Creek Parkway Recreation and Community Center Phone TDD Number Brooklyn Center, MN 55430-�199 (763) 569-3400 City Hall TDD Number (763) 569-3300 FAX (763) 569-3434 FAX (763) 569-3494 wtuw.cityofbrooklyncenter.org This page intentionaily left blank 4 Financial planning and control for the City of Brooklyn Center is based on the Annual Budget and the five-year Capital Improvement Program. Under Minnesota Statutes, a preliminary property tax levy must be adopted no later than September 15 of each year for the ensuing year's collection. This establishes a maximum levy that may be subsequently lowered but not raised. Effective establishment of this levy reguires a preliminary budget be prepared. The City Manager prepares such a budget each summer and presents it to the City Council in August, prior to the consideration of the preliminary tax levy. In addition, the City Council reviews the recommended rates and charges for enterprise funds and other operations on an annual basis as part of the budget process. Citizens receive a notice of proposed ta�es in November based on the preliminary levies established by all taxing districts. Following the receipt of this notice, citizens are invited to public hearings known as Truth in Taxation hearings in each jurisdiction. The City's hearing includes information about the budget, the property tax levy and the priorities of the Cit Council f v or the comin ear a m y b y s ade evtdent by the budget ailocattons. Public comment is heard at this hearing and the final property tax levy is adopted at a subse�uent meeting. This forms the basis for the budget preparation and presentation framework. In addition, a Capital Improvement Program is reviewed and revised during the budget process each year. This includes projects for which the City must issue debt and/or assess portions of the cost to adjacent or benefited property owners. Because there are limited fiinds available each year and the City does not wish to issue excessive amounts of debt, these projects must be reviewed and sometimes reprioritized as the Capital Improvement Program is developed each year. Economic Condition and Olitlook The City of Brooklyn Center is a northern suburb of the Minneapolis/St. Paul metropolitan area, adjacent to the City of Minneapolis and located 10 miles from i downtown Minneapolis. The City is wholly within Hennepin County and encompasses an area of a roximatel 8.5 s uare miles. The Mi si i i Rive PP s ss r forms the Ct s Y a PP tY eastern boundary. The City experienced its most rapid growth from 1950 to 1970 when the Ci 's tY population grew from 4,300 to its peak of 35,173. The 2000 Census data for the City was 29,172, a slight increase from the 1990 Census data of 28,887. The number of housing units has remained stable at 11,430 units, there were 11,704 housing units in 1990. r I5 e The estimated market value of property within the City increased 9.2% in 2003 over 2002, 12.42% in 2002 over 2001 and it increased 12.39% in 2001 over 2000. Residential values are continuing to rise in early 2004 although commercial/industrial values are reflecting an increase in new construction and some decline in existing values. Strong demand for starter homes has continued to drive up values of residential property in the City. Major transportation routes in and through the City, including Interstates 94 and 694, and State Highway 100 and 252, have provided a continued impetus for development of a strong commercial tax base in the City along and adjacent to these corridors. Commercial and industrial properties comprised 38% of the City's taxable net tax capacity in 2003. The largest commercial property in the City is Brookdale Mall, a 1,093,931 square-foot regional shopping center. Factors Affecting Financial Condition Maior Events of 2003 and Local Economv Brooklyn Center is a mature, developed suburb that is working to revitalize itself. With its affordable housing, excellent schools, beautiful parks, and convenient access, it has the potential to continue to be a vibrant community for many years to come. The revitalization of Brookl n Center is roceedin on three tracks: re lacement and renewal Y P g p of the commercial areas of the City; replacement and enhancement of its aging streets, utilities, and parks; and the reinvigoration of neighborhoods. The City continued its redevelopment effort in the Brooklyn Boulevard and 69 Avenue area with the completion of a Culver's Restaurant on the northeast corner and construction of a neighborhood retail center on the property. This approximately 5.2 acre site contained some of the older commercial property along Brooklyn Boulevard. A Super America convenience store gas station is anticipated to be constructed in 2004. A large new display and service facility for Global Office Furnishings is under construction at Shingle Creek Parkway and Freeway Boulevard. Holiday Station Stores constructed a commissary facility at Shingle Creek Parkway and 69 in 2003. The third phase of the Joslyn soils district was filled with the start of construction for the world headquarters of Caribou Coffee. The total of the three phases in the Joslyn project have added approximately 400 jobs. As part of a planned replacement of the aging infrastructure, the City is in the process of completing several street and utility improvements. These improvements were funded by general obligation improvement bonds supported with special assessments against benefited properties, an operating transfer from the general fund, and funds from the capital projects funds and utility enterprise funds. About one twenty-fifth of the City's streets and utilities are reconstructed each year. It is expected that this will be a perpetual process, since at the end of twenty-five years, it will be necessary to begin the process anew with the streets that were done first. An additional benefit of these neighborhood 6 projects has been the increased interest by residents and t�eir efforts to paint, repair, landscape and further enhance their properties. The hospitality industry contributes a significant amount to Brooklyn Center's economy. Lodging tax provided more than 345,000 for the 2003 fiscal year operations. Plans for a new hotel to augment the success of the City-owned Earle Brown Heritage Center conference and convention facility are under consideration. Infrastructure and Transnortation Interstate 94 and Highway 100 continue to undergo reconstruction and expansion. As these projects are completed and open for use, traffic to and from the retail and industrial areas of Brooklyn Center will be greatly improved. Continuation of the local street improvements proceeded on schedule in 2003 and will continue in 2004. The establishment of a Street Reconstruction Fund in 2003 will help plan for the ongoing nature of these projects. Park lighting and sidewalks will also be on the schedule to improve the community infrastructure. Development of utility rate models has improved the City's ability to generate cash flow and schedule improvements to the water and sewer systems. Separate funds for street lighting and stormwater drainage have also helped control and prioritize infrastructure improvements and operations in these areas. Cash Management The City of Brooklyn Center receives interest on all funds deposited by the City in its bank and investment accounts. During 2003 daily funds were moved to a"sweep" account paying an interest rate of just under 1% per year. Other funds were invested in various treasury securities and mortgage backed securities considered acceptable risks under the "prudent person" investment limitations of Minnesota Statutes. Longer term investments will have a slightly higher rate of interest compared to the overnight "sweep" rates of liquid cash. In addition, the City invests in the 4M and 4MPlus funds sponsored by the League of Minnesota Cities. These accounts pay a return higher than liquid cash but lower than treasuries and mortgage backed securities. The advantage of using these funds is liquidity. Treasury management requires a balance between the availability of cash and investment to obtain the highest return without undue risk of public assets. 7 i Awards and Acknowled�ements This re ort has been re ared followin the uidelines recommended by the Government P P P g g Finance Officers Association of the United States and Canada. The Government Finance Officers Association awards a Certificate of Achievement for Excellence in Financial Reporting to those governments whose Comprehensive Annual Financial Reports are judged to conform substantially with the high standards of public firiancial reporting, including generally accepted accounting principles promulgated by the Government Accounting Standards Board. For the past twenty years the City of Brooklyn Center's report has merited this award. It is my belief that the accompanying report meets program standards. It will again be submitted to the Government Finance Officers Association for review. The preparation and publication of this report would not have been possible without the efficient work of the Finance staff of the City. We would like to acknowledge all staff who contributed their efforts to the Finance operations in 2003 and thank them for their dedicated service. We would also like to thank the Mayor and City Council for their support in promoting and maintaining the highest standards of professionalism and management of the City of Brooklyn Center's finances. Respec ully S itted f G� Michael J. Caule Daniel Jordet City Man r Director of Fiscal Support Services i 1 g Certificate of Achievement for Excellence in Financial Rep orting Presented to C�ty of Brooklyn Center, Minnesota For its Comprehensive Annual Financial Report for the Fiscal Year Ended December 31, 2002 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Associatian of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financiai reporting. ��E aFF��� President Executive Director 9 This page intentionally left blank 10 CITY OF BROOKLYN CENTER, MINNESOTA PRINCIPAL OFFICIALS December 31, 2003 Term of Office Term Expires Mayor: Myrna Kragness Four Years December 31, 2006 Council Members: Kathleen Carmody Four Years December 31, 2006 Kay Lasman Four Years December 31, 2004 Diane Niesen Four Years December 31, 2006 Robert Peppe Four Years December 31, 2004 City Manager: Michael J. McCauley Appointed 11 This page intentionally left blank 12 City of Brooklyn Center Organization 2003 I Electorate I Gity Council Advisory Commissions Administration City Attorney City Manager Purchasing •Human Resources •Communications •Mgmt. Info. Systems •Elections •Licenses •City Clerk w l Public Works Police Department Community Activities, Enterprise •Engineering •Patrol Recreation, and Services •Liquor •Street Maint. •Investigation •Community Programs •Heritage Center •Sanitary Sewer •Crime Prevention •Recreation Programs •Central Garage •Community Programs •Community Center i �Storm Sewer •Support Services •Gov't Buildings •Water Dept. •Dispatch •Golf Course •Park Maint. •Senior Transportation Fire Department Fiscal and Communit Develo men y p t •Fire Prevention SU ort Services •Inspections pp •Fire Suppression •Accounting •Economic Development •Emergency •Audit •Housing Redevelopment Authority Preparedness •Utility Billing •Zoning •Risk Management •Planning •AccPCC� This page intentionally left blank 14 II. FINANCIAL SECTION 15 I I This page intentionally left blank I 16 Tautges Redpath, Ltd. Certified Public Accountants and Consultants INDEPENDENT AUDITOR'S REPORT 1 To tk�e Honorable Mayor and Members of the City Council Ciiy of Brooklyn Center, Minnesota We have audited the accompanying financial statements of the govemmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Brooklyn Center, Minnesota, as of and for the year ended December 31, 2003 which collectively comprise the City of Brooklyn Center, Minnesota's basic financial statements as listed in the table of contents. These basic tinancial statements are the responsibility of the City of Brooklyn Center, Minnesota's management. Our responsibility is to express opinions on these basic financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the basic fmancial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the basic financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall.fmancial statement presentation. We believe that our audit provides a reasonable basis for our opinions. In our opinion, the basic financial statements referred to above present fairl in all material Y respects, the fmancial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Brooklyn Center, Minnesota, as of December 31, 2003, and the respective changes in financial position and cash flows, where applicable, thereof for the year then ended in conformity with accounting principies generally accepted in the United States of America. As described in Note 17 to the basic fmancial statements, the City of Brooklyn Center, Minnesota adopted the provisions of Governmental Accounting Standards Board Statement No. 33, Accounting and Financial Reporting for Nonexchange ?'ransactions, Statement 34, Basic Financial Statements and Management's Discussion and Analysis for State and Local Governments, Statement 36, Recipient Reporting for Certain Shared Nonexchange Revenues, Statement 37, Basic Financial Statements and Management's Discussion and Analysis for State and Loca1 Governments: Omnibus, and Statement 38, Certain Financial White Bear Lake Office: 4810 White Bear Parkway, White Bear Lake, Minnesota 55110, USA Telephone: 651 426 7000 Fax: 651 426 5004 Hastings Office: 1303 South Frontage Aoad, Suite 13, Hastings, MN 55033, USA Telephone: 651 480 4990 Fax: 651 426 5004 HLB Tautges Redpath, Lttl. is a member of Interoational. A world-wide organization of accoun�,iryg firms and husiness advisers. 1/ This page intentionally left blank i 18 Statement Note Disclosz�res, as of January l, 2003. This results in a change in the format and content of the basic financial statements. In accordance with Government Aarditing Standards, we have also issued a report dated May 27, 2004 on our consideration of the City of Brooklyn Center, Minnesota's internal control over fmancial reportin and our tests of its com liance with cert g p ain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit perfarmed in accordance with Government Azrditing Standards and should be read in conjunction with this report in considering the results of our audit. t The Mana ement's Di c g s ussion and Analysis and the budgetary mformation as listed in the table of contents, respectively, are not a required part of the basic financial statements but are supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of ineasurement and presentation of the supplementary information. However, we did not audit the information and express no opinion on it. Our audit was made far the u ose of formin an o inion p rp g p on the fmanc�al statements that collectively comprise the City of Brooklyn Center, Minnesota's basic financial statements. The introductory section, combining and individual fund statements and schedules, supplementary financial information and statistical information as listed in the table of contents are presented for ptuposes of additional analysis and are not a required part of the basic financial statements. The combining and individual fund statements and schedules and supplementary financial information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects, in relation to the basic fmancial statements taken as a whole. The introductory 1 section and statistical information have not been subjected to the auditing procedures applied in the audit of the basic fmancial statements and, accordingly, we express no opinion on them. May 27, 2004 Gf�. 1 HLB TAUTGES REDPATH, LTD. Certified Public Accountants 'I 19 I This page intentionally left blank I I 20 MANAGEMENT'S DISCUSSION AND ANALYSIS As management of the City of Brooklyn Center, we offer readers of the City of Brooklyn Center's financial statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended December 31, 2003. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal, which can be found on pages 3 through 8 of this report. Financial Hishli�hts The assets of the City exceeded its liabilities at the close of the most recent fiscal year by 91,767,264 (Net assets). Of this amount, 24,282,266 (unrestricted net assets) 1 may be used to meet the government's ongoing obligations to citizens and creditors in accordance with the City's fund designations and fiscal policies. The City's total net assets increased by 4,760,112. A s of the close of the current fiscal year, the City s governmental funds reported combined ending fund balances of 23,870,493. Of this total amount, $15,420,670, or 65% is designated or reserved through legal restrictions and City Council authorization. At the end of the current fiscal year the general fund balance of 8,017,070 included ll0,383 reserved, 6,031,077 designated, and 1,875,620 undesignated. The City's total outstanding debt decreased by 2,225,000 during the current fiscal year, from 19,605,000 to 17,380,000. 1 Overview of the Financial Statements The discussion and analysis are intended to serve as an introduction to the City's basic financial statements. The City's basic financial statements comprise three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. 21 Management's Discussion and Analysis Government-wide financial statements. The government-wide financial statements are designed to provide readers with a broad overview of the City's finances, in a manner similar to a private-sector business. The statement of net assets presents information on all of the City's assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. Th of activit' w the Ci 's net assets chan ed e statement ies presents information showmg ho ty g during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g. uncollected taxes and earned but unused vacation leave). Both of the government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City of Brooklyn Center include general government, public safety, public works, community services, recreation and economic development. The business-type activities of the City include liquor operations, golf course, convention center, water, sewer, storm drainage, recycling/refuse and street lighting. The government-wide financial statements can be found on pages 35 through 49 of this report. Fund Financial statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, 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 two categories: governmental funds and proprietary funds. Governmental funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spend-able resource, as well as on balances of spend-able resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financial requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented far governmental funds with similar information presented for governmental activities in the government-wide financial statement. By doing so, readers may better understand the long-term impact of the 22 Management's Discussion and Analysis City's near term financial decisions. Both the governmental fund balance sheet and governmental fund statement of revenues, expenditures, and change in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. The City maintains 5 individual major governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the general fund, the Earle Brown TIF District special revenue fund, TIF District No. 3 special revenue fund, the Special Assessment Bonds debt service fund and the Special Assessment Construction capital projects fund, which 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 and special revenue funds. A bud etar com arison statement has been rovided for those funds to demonstrate g Y P p compliance with this budget. The basic governmental fund financial statements can be found on a es 38 throu h 41 of Pg g this report. Proprietary funds. The City of Brooklyn Center maintains eight enterprise funds and three internal service funds as a part of its proprietary fund type. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City of Brooklyn Center uses enterprise funds to account for its liquor, golf course, convention center, water, sewer, storm drainage, recycling/refuse and street lighting operations. The City of Brooklyn Center uses internal service funds to account for its fleet of vehicles, retirement benefits and compensated absences. Because these services predominately benefit governmental rather than business-type functions, they have been included within governmental activities in the government-wide financial statements. Proprietary funds provide the same type of information as the government-wide financial 1 statements, only in more detail. The proprietary fund financial statements provide separate information for the municipal liquor, golf course, Earle Brown Heritage Center, water, sanitary sewer, storm drainage, recycling/refuse, and street lighting operations, all with the exception of recycling/refuse and street lighting are considered to be major funds. Conversely, the internal service funds are combined into a single, aggregated presentation in the proprietary fund financial statements. Individual fiind data for the nonmajor proprietary funds and internal service funds is provided in the form of combining statements elsewhere in this report. 1 23 Management's Discussion and Analysis The basic proprietary fund financial statements can be found on pages 44 through 49 of this report. Notes to the financial statements. The notes provide additional information that is essential to a full understanding of the data provided in the government—wide and fund financial statements. The notes to the financial statements can be found on pages 51 through 82 of this report. Other information. The combining statements referred to earlier in connection with non- majar governmental funds, nonmajor proprietary fund and internal service funds are presented immediately following the required supplementary information on budgetary comparisons. Combining and individual fund statements and schedules can be found on pages 99 through 134 of this report. Government-wide Financial Analvsis t As noted earlier, net assets may serve over time as a useful indictor of a government's financial position. In the case of the City, assets exceeded liabilities by $91,767,264 at the close of the most recent fiscal year. The largest portion of the City's net assets ($52,631,738 or 57 percent) reflects its investment in capital assets (e.g. land, buildings, machinery, and equipment) less any related debt used to acquire those assets that is still outstanding. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. 24 1 Management's Discussion and Analysis CITY'S NET ASSETS Business- Governmental Type Activities Activities Total Current and other assets $36,422,171 $8,334,766 $44,756,937 Capital assets 31,739,661 38,348,615 70,088,276 Total assets $68,161,832 $46,683,381 $114,845,213 Long term liabilities outstanding $14,193,227 $230,000 $14,423,227 Other liabilities 6,564,288 2,090,434 8,654,722 Totalliabilities $20,757,515 $2,320,434 $23,077,949 Net assets Invested in capital assets net ofrelated debt $14,733,123 $37,898,615 $52,631,738 Restricted 14,853,260 14,853,260 Unrestricted 17,817,934 6,464,332 24,282,266 Total net assets $47,404,317 $44,362,947 $91,767,264 A portion of the of the City of Brooklyn Center's net assets represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net assets 24,282,266) may be used to meet the City's ongoing obligations to citizens and creditors. At the end of the current fiscal ear the i y, C ty of Brooklyn Center is able to report positive balances in all three categaries of net assets, both for the government as a whole, as well as for its separate governmental and business-type activities. 1 1 25 Management's Discussion and Analysis Governmental Activities Government activities resulted in an increase of the City's net assets by $4,109,660, while the overall increase totaled 4,760,112. Key elements of the increase are as follows: Business- Governmental Type Activities Activities Total Program revenue: Charges for services $1,827,716 $8,974,412 $10,802,128 Operating grants and contributions 1,627,020 1,627,020 Capital grants and contributions 1,079,134 1,079,134 General revenue: PropeRy ta�ces 10,407,613 10,407,613 Other taxes 4,189,148 4,189,148 Grants and contributions not restricted to programs 1,413,913 1,413,913 Gain on the sale of assets 13,976 13,976 Unrestricted investment earnings 426,329 82,165 508,494 Other 588,264 241,308 829,572 Total revenues 21,573,113 9,297,885 3Q870,998 Expenses General government 2,565,088 2,565,088 Publicsafety 7,184,536 7,184,536 Public works 3,002,223 3,002,223 Community services 225,365 225,365 Parks and recreation 2,169,482 2,169,482 Economic development 1,759,585 1,759,585 Nondepartmental 657,174 657,174 Municipalliquor 724,897 724,897 Golf course 290,990 290,990 Earle Brown Heritage Center 2,109,166 2,109,166 Recycling and refuse 223,679 223,6'79 Water utility 1,64�,9�5 1,645,955 Sanitary sewer 2,�67,032 2,567,032 Storm drainage 838,421 838,421 Street light utility 147,293 147,293 Total expenses 17,563,453 8,547,433 26,110,886 Increase (decrease) in in net assets before transfers 4,009,660 750,452 4,760,112 Transfers 100,000 (100,000) Increase in net assets 4,109,660 6�0,452 4,760,ll2 Net assets January 1 43,294,6�7 43,712,495 87,007,152 Net assets December 31 $47,404,317 $44,362,947 $91,767,264 26 Management's Discussion and Analysis Below are specific graphs which provide comparisons of the governmental activities revenues and expenditures: Governmental AcfiviAes 2003 Revenues Unresvicted Grants and im�esiment contnbuuoncrot Otherrevenue Clargesforservices O ratin restricted to programs 3% 2/ g S s co�xnbuuons xr 1 Capilal grams and ao b�tio� ou�� Ta es l I°/ 3 ..�°�.e� 48% Pmpcny ta es and special assessmen�s 1 Governmemal Activities 2003 Expenses General Economicdcvelopmcnl N c W 1% ID/ Parl:s and t recrcauon .I 12% a Conununiry y scrviccs l% Public worl:s Public sakty ll% 17% Management's Discussion and Analysis Business-Type Activities Business-type activities increased net assets by$ 650,452 accounting for 14%of the City's , growth in net assets. Below are graphs showing the business-type activities revenue and expense comparisons: ' Business-Type Activities-2003 Revenues Utuestricted investment �. earnings Other revenue t% 3% i r � r 4& 'N i Net charges for services 96% Business-Type Activities-2003 Expenses Sheet light uhliN Mwticipal liquor Stomt drainage 2% g% Golf course 10% 3% S a Fade Brown u^ Sammy se ter 30% 3% Recycling and Water wility refuse l9% 28 ' Management's Discussion and Analysis Financial Analysis of the Government's Funds ' Governmental Funds. The focus of the City's governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City's financing requirements. In particular, unreserved fund balance may serve as useful measure of a government's net resources available for spending at the end of the fiscal year. At the end of the current fiscal year, the City's governmental funds reported combined ending fund balances of$23,870,493. Approximately 32%of this amount($7,619,698) is reserved because it has already been committed 1) to provide for debt service ($5,321,277), 2) loans I receivable ($2,293,112), and 3) for prepaid items($5,309). The unreserved fund balance of $16,250,795, includes designations for 1) general fund working capital ($6,031,077) and 2) Special Revenue Funds for housing development ($1,769,895). The balance is undesignated and unreserved ($8,449,823). The general fund increased by $87,306 in 2003, which was due to a slightly higher net increase in general revenues over expenses than originally budgeted expected. The Earle Brown TIF District fund increased by $129,087 in 2003 because tax increments ' were a bit higher than expected and debt transfers were not required as budgeted. The TIF District No. 3 fund increased by $1,262,445 in 2003 because tax increment receipts ' far outweighed expenditures in the district. A large increase was budgeted and expected. The Special Assessment Bonds fund increased by $320,115 in 2003 because some required ' assessments were paid in advance. The Infrastructure Construction fund increased by $677,130 in 2003 because bond proceeds 1 were received. The non-major special revenue funds increased by $365,608 for 2003, due to grants and tax increment receipts, particularly in TIF district# 4. The non-major debt service funds decreased by $740,029. This was due in large part to the ' final payoff of outstanding TIF bonds with reserves as opposed to making scheduled fund transfers from Special Revenue Funds. 29 Management's Discussion and Analysis Proprietary funds. The City's proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail ' The unrestricted net assets in the respective major proprietary funds are the municipal liquor fund - $1,072,288, golf course—($823,610) (indicating a fund deficit), Earle Brown Heritage Center- $747,546, water utility - $2,269,980, sanitary sewer- $1,840,611 and storm drainage - $1,166,234. The municipal liquor, golf course, Earle Brown Heritage Center, water utility, sanitary sewer and storm drainage funds had increases in net assets in 2003 of$52,033, $7,467, ($346,403) (indicating a reduction in net assets for the period), ($62,382), $391,240, and $578,401, respectively. Capital Asset and Debt Administration Capital assets. The City's, investment in capital assets for its governmental and business- type activities as of December 31, 2003, amounts to $70,088,276 (net of accumulated depreciation). This investment in capital assets includes land, buildings, infrastructure, machinery and equipment. Business- Governmental Type Activities Activities Total Land(not depreciated) $3,203,904 $3,197,342 $6,401,246 Land improvements - 368,088 368,088 Construction in progress 927,629 - 927,629 Buildings and structures 14,040,653 12,120,833 26,161,486 Departmental equipment 2,435,047 327,863 2,762,910 Other park improvements 1,145,575 - 1,145,575 ' Streets 9,986,853 - 9,986,853 Mains and lines - 22,334,489 22,334,489 $31,739,661 $38,348,615 $70,088,276 , Long-term debt. At the end of the current fiscal year, the City had long-term bonded debt , outstanding of$17,380,000, a decrease of$2,225,000 from 2002. $6,720,000 is for general obligation bonds, $4,505,000 for tax increment bonds and $5,705,000 for special assessment bonds. An additional $450,000 of storm sewer revenue bonds are outstanding at year end in , the business-type activities. 30 , Management's Discussion and Analysis Additional long-term liabilities include $783,227 for compensated absences. This is the accumulated vacation and sick leave available but not used by employees at the end of 2003. City's Outstanding Debt General Obligation Improvement Bonds, General Obligation Tax Increment Bonds, Long-Term Notes and Compensated Absences Business- Governmental Type Activities Activities Total General Obligation Bonds $6,720,000 $ - $6,720,000 General Obligation Tax Increment Bonds 4,505,000 - 4,505,000 General Obligation Special Assessment Bonds 5,705,000 - 5,705,000 Revenue Bonds 450,000 450,000 Compensated absences 783,227 - 783,227 $17,713,227 $450,000 $18,163,227 ' The City maintains an Al rating from Moody's. State statutes limit the amount of general obligation debt a Minnesota city may issue to 2% of ' total Estimated Market Value. The current debt limitation for the City is $36,802,306. Only $5,875,000 of the City's outstanding debt is counted within the statutory limitation amounting to about 16%of the total limit. ' Requests for information. This financial report is designed to provide a general overview of the City's finances for all those with an interest in the government's finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Director of Fiscal and Support Services, City of Brooklyn Center, 6301 Shingle Creek Boulevard, Brooklyn Center, Minnesota 55430. 31 -This page intentionally left blank- t 32 , ' BASIC FINANCIAL STATEMENTS 33 r I 1 r 1 1 r r 1 r -This page intentionally left blank- , r r r r r r r r 34 r CITY OF BROOKLYN CENTER,MINNESOTA STATEMENT OF NET ASSETS Statement 1 December 31,2003 ' Primary Government Governmental Business-Type Assets: Activities Activities Total ' Cash and investments $30,345,476 $5,985,200 $36,330,676 Receivables: Interest 269,579 - 269,579 ' Accounts 66,099 1,588,636 1,654,735 Delinquent taxes 752,095 752,095 Special assessments 3,512,018 272,070 3,784,088 Internal balances 910,998 (910,998) - ' Due from other governments 414,592 - 414,592 Prepaid expenses 5,309 148,026 153,335 Inventories-at cost 14,852 340,834 355,686 Restricted assets: Cash and investments 131,153 - 131,153 Capital assets-net 31,739,661 38,348,615 70,088,276 Total assets 68,161,832 45,772,383 113,934,215 ' Liabilities: Accounts payable 940,482 547,877 1,488,359 Deposits payable - 176,023 176,023 ' Due to other governments 56,881 - 56,881 Accrued salaries and wages 403,597 77,598 481,195 Accrued health insurance 1,547,235 - 1,547,235 ' Accrued interest payable 76,538 10,033 86,571 Unearned revenue 19,555 147,905 167,460 Compensated absences payable: Due within one year 783,227 - 783,227 Bonds payable: Due within one year 3,520,000 220,000 3,740,000 Due in more than one year 13,410,000 230,000 13,640,000 ' Total liabilities 20,757,515 1,409,436 22,166,951 Net assets: Invested in capital assets,net of related debt 14,733,123 37,898,615 52,631,738 ' Restricted for: Debt service 8,454,580 - 8,454,580 Tax increment purposes 6,398,680 - 6,398,680 ' Unrestricted 17,817,934 6,464,332 24,282,266 Total net assets $47,404,317 $44,362,947 $91,767,264 The accompanying notes are an integral part of these financial statements. 35 CITY OF BROOKLYN CENTER,MINNESOTA STATEMENT OF ACTIVITIES For The Year Ended December 31,2003 Charges For ' Expenses Services F unctions/Pro grams Primary government: , Government activities: General government $2,565,088 $227,350 Public safety 7,184,536 951,518 , Public works 3,002,223 24,554 Community services 225,365 - Parks and recreation 2,169,482 624,294 Economic development 1,759,585 - ' Nondepartmental 342,142 - Administrative services reimbursement (607,221) - Interest on long-term debt 922,253 - ' Total government activities 17,563,453 1,827,716 Business-type activities: , Municipal liquor 724,897 853,353 Golf course 290,990 294,149 Earle Brown Heritage Center 2,109,166 1,749,202 Water utility 1,645,955 1,530,592 ' Sanitary sewer 2,567,032 2,870,109 Storm drainage 838,421 1,264,512 Other enterprise funds 370,972 412,495 ' Total business-type activities 8,547,433 8,974,412 Total primary government $26,110,886 $10,802,128 The accompanying notes are an integral part of these financial statements. ' 36 Statement 2 Net(Expense)Revenue and Program Revenues Changes in Net Assets Operating Capital Primary Government Grants and Grants and Governmental Business-Type Contributions Contributions Activities Activities Total $ $ - ($2,337,738) $ - ($2,337,738) 690,841 - (5,542,177) - (5,542,177) 424,182 1,079,134 (1,474,353) (1,474,353) 122,502 - (102,863) - (102,863) ' - (1,545,188) (1,545,188) 389,495 -(1,370,090) (1,370,090) (342,142) - (342,142) - 607,221 - 607,221 - - (922,253) - (922,253) 1,627,020 1,079,134 (13,029,583) 0 (13,029,583) - - 128,456 128,456 3,159 3,159 - - (359,964) (359,964) - - (115,363) (115,363) 303,077 303,077 - - 426,091 426,091 ' - - - 41,523 41,523 0 0 0 426,979 426,979 $1,627,020 $1,079,134 ($13,029,583) $426,979 ($12,602,604) ' General revenues: Property taxes $10,407,613 $ - $10,407,613 Tax increment collections 3,527,881 - 3,527,881 Lodging taxes 661,267 - 661,267 Grants and contributions not restricted to specific programs 1,413,913 - 1,413,913 Unrestricted investment earnings 426,329 82,165 508,494 Gain on disposal of fixed asset 13,976 - 13,976 Other 588,264 241,308 829,572 Transfers 100,000 (100,000) - Total general revenues and transfers 17,139,243 223,473 17,362,716 ' Change in net assets 4,109,660 650,452 4,760,112 Net assets-beginning 43,294,657 43,712,495 87,007,152 Net assets-ending $47,404,317 $44,362,947 $91,767,264 The accompanying notes are an integral part of these financial statements. ' 37 CITY OF BROOKLYN CENTER,MINNESOTA BALANCE SHEET GOVERNMENTAL FUNDS December 31,2003 Earle Brown TIF Assets General District Cash and investments $8,145,364 $61,886 Receivables: ' Interest 269,579 - Accounts 57,908 - Delinquent taxes 410,936 116,856 Special assessments 251 - ' Due from other funds - Due from other governments 30,074 Prepaid expenses 5,309 Advances to other funds 105,074 ' Restricted assets: Cash and investments 131,153 Total assets $9,155,648 $178,742 Liabilities and Fund Balances ' Liabilities: Accounts payable $416,963 $6,136 Due to other funds - 1,043,323 ' Due to other govemments 1,884 Accrued salaries and wages 378,286 658 Advances from other funds - 698,143 Deferred revenue 341,435 115,850 Total liabilities 1,138,568 1,864,110 Fund balances: Reserved for: - , Prepaid items 5,309 Loan receivable 105,074 Debt service Unreserved: ' Designated reported in: General Fund 6,031,077 Special Revenue Funds Undesignated reported in: , General Fund 1,875,620 Special Revenue Funds - (1,685,368) Capital Project Funds - Total fund balances 8,017,080 (1,685,368) Total liabilities and fund balances $9,155,648 $178,742 The accompanying notes are an integral part of these financial statements. ' 38 Statement 3 TIF Special Other Intra- Total ' District Assessment Infrastructure Governmental Activity Governmental No.3 Bonds Construction Funds Eliminations Funds $5,085,782 $2,963,637 $823,448 $6,364,171 $ $23,444,288 - - 269,579 4,223 473 62,604 172,625 10,266 - 41,412 752,095 - 3,105,485 406-282 - 3,512,018 323 1,043, 158,933 (1,202,256) 332,182 52,336 414,592 - - 5,309 2,188,038 (1,408,112) 885,000 131,153 $6,301,730 $6,079,388 $1,566,135 $8,805,363 ($2,610,368) $29,476,638 $7,972 $ $191,400 $306,195 $ - $928,666 ' _ _ - 158,933 (1,202-256) - 54,997 56,881 1,843 - 12,291 393,078 709,969 - (1,408,112) - ' 172,625 3,102,514 435,587 59,509 4,227,520 182,440 3,102,514 1,336,956 591,925 (2,610,368) 5,606,145 - - 5,309 2,188,038 2,293,112 2,976,874 2,344,403 - 5,321,277 - - - - 6;031,077 1,769,895 - 1,769,895 ' - - 1,875,620 4,349,395 - 1,777,097 - 4,441,124 - - 229,179 1,903,900 - 2,133,079 ' 6,119,290 2,976,874 229,179 8,213,438 0 23,870,493 $6,301,730 $6,079,388 $1,566,135 $8,805,363 ($2,610,368) $29,476,638 Fund balance reported above $23,870,493 ' Amounts reported for governmental activities in the statement of net assets are different because: Capital assets used in governmental activities are not financial resources,and therefore,are not reported in the funds 29,501,331 ' Other long-term assets are not available to pay for current- period expenditures and,therefore,are deferred in the funds. 4,207,965 Long-term liabilities,including bonds payable,are not due and payable in the current period and therefore are not reported in the funds. (17,006,538) Internal service funds are used by management to charge the cost of certain activities to individual funds. The assets and liabilities are included in the governmental statement of net assets 6,831,066 Net assets of governmental activities $47,404,317 ' The accompanying notes are an integral part of these financial statements. ' 39 CITY OF BROOKLYN CENTER,MINNESOTA STATEMENT OF REVENUES,EXPENDITURES AND ' CHANGES IN FUND BALANCE GOVERNMENTALFUNDS For The Year Ended December 31,2003 Earle Brown ' TIF General District Revenues: Taxes and special assessments $10,799,074 $833,553 ' Licenses and permits 827,685 - Intergovernmental 1,948,457 - Charges for services 678,875 ' Court fines 290,408 - Investment earnings 96,522 4,503 Miscellaneous 261,889 - ' Total revenues 14,902,910 838,056 Expenditures: Current: , General government 2,472,352 - Public safety 6,254,938 - Public works 1,549,525 - ' Community services 91,581 - Parks and recreation 2,030,402 - Economic development 316,059 55,969 Nondepartmental 331,223 - Administrative services reimbursement (607,221) - Capital outlay: General government 25,256 - Public safety 17,937 - Public works 99,880 - Parks and recreation 37,632 - Nondepartmental 1,385 Debt service: Principal retirement - - Interest Paying agent fees - - Total expenditures 12,620,949 55,969 Revenues over(under)expenditures 2,281,961 782,087 Other financing sources(uses): Bonds issued - - Discount on debt issued - - ' Sale of land - - Transfers in - - Transfers out (2,194,655) (653,000) , Total other financing sources(uses) (2,194,655) (653,000) Net increase(decrease)in fund balance 87,306 129,087 Fund balance-January 1 7,929,774 (1,814,455) ' Fund balance-December 31 $8,017,080 ($1,685,368) The accompanying notes are an integral part of these financial statements. 40 ' Statement 4 ' TIF Special Other Intra Total District Assessment Infrastructure Governmental Activity Governmental No. 3 Bonds Construction Funds Eliminations Funds $2,308,605 $1,153,044 $79,207 $454,858 $ - $15,628,341 - - - 827,685 ' = - 332,182 1,198443 3,479,082 24,554 6,194 709,623 290,408 81,399 35,548 10,934 88,843 - 317,749 ' - - - 345,693 - 607,582 2,390,004 1,188,592 446,877 2,094,031 0 21,860,470 - - - 2,971 - 2,475,323 - 365,543 - 6,620,481 = 328,130 236,723 - 2,114,378 91,581 - - - - - 2,030,402 579,559 - - 806,670 - 1,758,257 - - - - - 331,223 (607,221) ' - - - 90,224 - 115,480 17,937 1,117,757 491,289 - 1,708,926 - - - - - 31,632 1,385 870,000 - 2,350,000 - 3,220,000 = 242,749 - 662,769 - 905,518 14,807 11,272 26,079 579,559 1,127,556 1,445,887 5,017,461 0 20,847,381 1,810,445 61,036 (999,010) (2,923,430) 0 1,013,089 - - 1,205,000 - - 1,205,000 ' = - (8,860) - - (8,860) 73,175 73,175 259,079 480,000 2,964,430 (3,603,509) 100,000 (548,000) - (207,854) 3,603,509 - (548,000) 259,079 1,676,140 2,829,751 0 1,369,315 1,262,445 320,115 677,130 (93,679) 0 2,382,404 ' 4,856,845 2,656,759 (447,951) 8,307,117 - 21,488,089 $6,119,290 $2,976,874 $229,179 $8,213,438 $0 $23,870,493 ' The accompanying notes are an P integral art of these financial statements. g 41 -This page intentionally left blank- ' t 42 ' CITY OF BROOKLYN CENTER,MINNESOTA RECONCILIATION OF THE STATEMENT OF REVENUES, Statement 5 EXPENDITURES,AND CHANGES IN FUND BALANCES OF GOVERNMENTALFUNDS For The Year Ended December 31,2003 t Amounts reported for governmental activities in the statement of activities are different because: Net changes in fund balances-total governmental funds(statement 4) $2,382,404 Governmental funds report capital outlays as expenditures. However,in the statement of activities the cost of those assets is allocated over their ' estimated useful lives and reported as depreciation expense. This is the amount by which capital outlays exceeded depreciation in the current period. 323,269 ' In the statement of activities,only the gain on the sale of capital assets is reported. However,in the governmental funds,the proceeds from the sale increase financial resources. Thus,the change in net assets differs from the change in fund balance by the cost of the capital assets sold. (95,000) Revenues in the statement of activities that do not provide current financial resources ' are not reported as revenues in the funds. (402,575) The issuance of long-term debt(e.g.,bonds,leases)provides current financial resources ' to governmental funds,while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction,however,has any effect on net assets. This amount is the net effect of these differences in the treatment of long-term debt and related items. 2,015,000 Internal service funds are used by management to charge the cost of ' certain activities to individual funds. This amount is net revenue attributable to governmental activities. (122,782) Accrued interest reported in the statement of activities does not require the use ' of current financial resources and,therefore, is not reported as expenditures in governmental funds. 9,344 Change in net assets of governmental activities(statement 2) $4,109,660 ' The accompanying notes are an integral part of these financial statements. ' 43 CITY OF BROOKLYN CENTER,MINNESOTA ' STATEMENT OF NET ASSETS PROPRIETARY FUNDS December 31,2003 ' Business-Type Activities ' Major Enterprise Funds Municipal Golf Earle Brown Liquor Course Heritage Center ' Assets: Current assets: Cash and cash equivalents $996,556 $61,621 $855,429 ' Accounts receivable-net 10,357 - 264,792 Special assessments receivable - - - Prepaid items 20,804 - 8,364 ' Inventories-at cost 275,245 3,580 34,419 Total current assets 1,302,962 65,201 1,163,004 Noncurrent assets: Capital assets: ' Land - 1,390,402 1,493,300 Land improvements - 40,258 327,830 Buildings and structures - 487,946 11,091,389 ' Machinery and equipment 253,003 11,160 45,544 Mains and lines - - - Total capital assets 253,003 1,929,766 12,958,063 ' Less: Allowance for depreciation (106,739) (156,844) (4,072,810) Net capital assets 146,264 1,772,922 8,885,253 Total noncurrent assets 146,264 1,772,922 8,885,253 Total assets 1,449,226 1,838,123 10,048,257 ' Liabilities: Current liabilities: ' Accounts payable 211,094 1,495 189,238 Deposits payable - - 170,973 Accrued salaries payable 19,580 2,316 35,337 Accrued interest payable - - - ' Deferred revenue - - 19,910 Current portion of long-term debt - Advances from other funds - 885,000 - Total current liabilities 230,674 888,811 415,458 Noncurrent liabilities: Bonds payable - - - Compensated absences payable Accrued health insurance liability - - - Total noncurrent liabilities 0 0 0 Total liabilities 230,674 888,811 415,458 Net assets: Invested in capital assets,net of related debt 146,264 1,772,922 8,885,253 Unrestricted 1,072,288 (823,610) 747,546 ' Total net assets $1,218,552 $949,312 $9,632,799 Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds Net assets of business-type activities The accompanying notes are an integral part of these financial statements. 44 ' Statement 6 Business-Type Activities Major Enterprise Funds Other Water Sanitary Storm Enterprise Total Internal Total . Utility Sewer Drainage Funds Enterprise Service Proprietary ' $1,890,755 $1,140,100 $914,076 $126,663 $5,985,200 $6,901,188 $12,886,388 294,622 659,925 267,251 91,689 1,588,636 3,495 1,592,131 260,954 3,124 7,992 - 272,070 - 272,070 ' 138 118-720 - - 148,026 - 148,026 27,590 340,834 14,852 355,686 2,474,059 1,921,869 1,189,319 218,352 8,334,766 6,919,535 15,254,301 23,093 3,389 287,158 - 3,197,342 - 3,197,342 - - - - 368,088 - 368,088 ' 3,331,384 2,484,959 _ - 17,395,678 - 17,395,678 128,668 179,130 617,505 5,816,573 6,434,078 13,715,130 12,446,383 11,979,555 - 38,141,068 - 38,141,068 17,198,275 15,113,861 12,266,713 0 59,719,681 5,816,573 65,536,254 (8,950,594) (6,554,207) (1,529,872) (21,371,066) (3,578,243) (24,949,309) 8,247,681 8,559,654 10,736,841 0 38,348,615 2,238,330 40,586,945 ' 8,247,681 8,559,654 10,736,841 0 38,348,615 2,238,330 40,586,945 10,721,740 10,481,523 11,926,160 218,352 46,683,381 9,157,865 55,841,246 56,251 75,676 13,052 1,071 547,877 11,816 559,693 5,050 - - - 176,023 - 176,023 14,783 5,582 - - 77,598 10,519 88,117 ' - - 10,033 - 10,033 - 10,033 127,995 147,905 147,905 - - 220,000 - 220,000 - 220,000 ' - - - - 885,000 - 885,000 204,079 81,258 243,085 1,071 2,064,436 22,335 2,086,771 - - 230,000 - 230,000 - 230,000 783,227 783,227 - - - - - 1,547,235 1,547,235 0 0 230,000 0 230,000 2,330,462 2,560,462 204,079 81,258 473,085 1,071 2,294,436 2,352,797 4,647,233 8,247,681 8,559,654 10,286,841 - 37,898,615 2,238,330 40,136,945 ' 2,269,980 1,840,611 1,166,234 217,281 6,490,330 4,566,738 11,057,068 $10,517,661 $10,400,265 $11,453,075 $217,281 44,388,945 $6,805,068 $51,194,013 (25,998) ' $44,362,947 The accompanying notes are an integral part of these financial statements. 45 CITY OF BROOKLYN CENTER,MINNESOTA ' STATEMENT OF REVENUES,EXPENSES AND CHANGES IN FUND NET ASSETS PROPRIETARY FUNDS ' For The Year Ended December 31,2003 Business-Type Activities ' Major Enterprise Funds Municipal Golf Earle Brown Liquor Course Heritage Center Operating revenues: Sales and user fees $3,407,990 $294,149 $3,393,810 Cost of sales 2,554,637 - 1,644,608 ' Total operating revenues 853,353 294,149 1,749,202 Operating expenses: Personal services 381,227 126,866 812,146 ' Supplies 25,669 19,501 90,368 Other services 116,784 88,494 340,303 Insurance 6,997 8,002 30,672 ' Utilities 12,636 17,208 157,339 Rent 144,499 - 104,776 Depreciation 35,580 27,912 571,632 Total operating expenses 723,392 287,983 2,107,236 ' Operating income(loss) 129,961 6,166 (358,034) Nonoperating revenues(expenses): ' Investment earnings 14,956 1,048 12,521 Special assessments - - - Gain(loss)on sale of fixed asset - - - ' Other revenue 7,116 253 82 Interest and fiscal agent fees - - (972) Total nonoperating revenues(expenses) 22,072 1,301 11,631 ' Income(loss)before contributions and transfers 152,033 7,467 (346,403) Transfers: ' Transfer to Capital Project Funds (100,000) - - Change in net assets 52,033 7,467 (346,403) ' Net assets-January 1 1,166,519 941,845 9,979,202 . Net assets-December 31 $1,218,552 $949,312 $9,632,799 inancial statements.The accompanying notes are an integral art of these f ' 46 ' I 1 Statement 7 t Business-Type Activities Mayor Enterprise Funds Other Total Water Sanitary Storm Enterprise Intra Activity Enterprise Internal Total ' Utility Sewer Drainage Funds Elimination Funds Service Proprietary $1,530,592 $2,870,109 $1,264,512 $412,495 $ $13,173,657 $1,017,718 $14,191,375 ' - - - - - 4,199,245 - 4,199,245 1,530,592 2,870,109 1,264,512 412,495 0 8,974,412 1,017,718 9,992,130 349,556 113,898 - - - 1,783,693 331,517 2,115,210 116,272 7,640 3,861 961 264,272 193,490 457,762 395,397 1,928,502 290,369 235,653 - 3,395,502 145,418 3,540,920 8,951 3,883 1-292 964 _ 60,761 42,561 103,322 121,400 22,978 133,394 464,955 2,713 467,668 - - - - - 249,275 - 249,275 648,115 479,323 513,608 - - 2,276,170 596,702 2,872,872 ' 1,639,691 2,556,224 809,130 370,972 0 8,494,628 1,312,401 9,807,029 (109,099) 313,885 455,382 41,523 0 479,784 (294,683) 185,101 1 1y 22,334 18,925 10,237 2,144 - 82,165 108,580 190,745 24,275 247 112,254 - - 136,776 - 136,776 - - - - - 35,801 35,801 108 58,183 26,363 12,427 - 104,532 1,522 106,054 ' - - (25,835) - - (26,807) - (26,807) 46,717 77,355 123,019 14,571 0 296,666 145,903 442,569 (62,382) 391,240 578,401 56,094 0 776,450 (148,780) 627,670 1 - - - - (100,000) - (100,000) ' (62,382) 391,240 578,401 56,094 0 676,450 (148,780) 527,670 10,580,043 10,009,025 10,874,674 161,187 - 43,712,495 6,953,848 50,666,343 ' $10,517,661 $10,400,265 $11,453,075 $217,281 $0 $44,388,945 $6,805,068 $51,194,013 1 The accompanying notes are an integral part of these financial statements. ' 47 CITY OF BROOKLYN CENTER,MINNESOTA ' STATEMENT OF CASH FLOWS PROPRIETARY FUNDS For The Year Ended December 31,2003 ' Business-Type Activities Major Enterprise Funds Municipal Golf Earle Brown 'Cash flows from operating activities: Liquor Course Heritage Center Receipts from customers and users $3,450,878 $294,149 $3,312,614 Receipts from interfund services provided - - - Payments to suppliers (2,800,865) (129,230) (2,331,407) Payments to employees (377,522) (126,880) (803,938) Miscellaneous revenue 7,116 253 (5,745) ' Net cash flows from operating activities 279,607 38,292 171,524 Cash flows from noncapital financing activities: Principal repayments on advance - (15,000) - ' Transfers out (100,000) -Net cash flows from noncapital financing activities (100,000) (15,000) 0 Cash flows from capital and related financing activities: ' Acquisition and construction of capital assets Principal paid on revenue bonds Interest paid on revenue bonds - - Net cash flows from capital and related financial activities 0 0 0 ' Cash flows from investing activities: Interest on investments 14,956 1,048 17,376 ' Net cash flows from investing activities 14,956 1,048 17,376 Net increase in cash and cash equivalents 194,563 24,340 188,900 Cash and cash equivalents-January 1 801,993 37,281 666,529 ' Cash and cash equivalents-December 31 $996,556 $61,621 $855,429 Reconciliation of operating income to net cash ' provided(used)by operating activities: Operating income(loss) $129,961 $6,166 ($358,034) Adjustments to reconcile operating income(loss) to net cash flows from operating activities: Depreciation 35,580 27,912 571,632 Changes in assets and liabilities: ' Decrease(increase)in receivables 47,154 - (77,196) Decrease(increase)in inventories 3,958 3,809 (7,669) Decrease(increase)in prepaid expenses (8,224) - 3,669 Increase(decrease)in payables 60,357 166 18,349 Increase(decrease)in accrued expenses 3,705 (14) 8,208 Increase(decrease)in accrued deferred revenue - - 18,310 Other nonoperating income 7,116 253 (5,745) ' Total adjustments 149,646 32,126 529,558 Net cash provided by operating activities $279,607 $38,292 $171,524 The accompanying notes are an integral part of these financial statements. 48 ' Statement 8 ' Business-Type Activities Major Enterprise Funds Other Total Water Sanitary Storm Enterprise Enterprise Internal Total ' Utility Sewer Drainage Funds Funds Service Proprietary $1,555,381 $2,821,168 $1,268,815 $409,638 $13,112,643 $ - $13,112,643 ' - - - - 1,023,441 1,023,441 (597,635) (1,910,329) (287,636) (382,408) (8,439,510) (428,029) (8,867,539) (345,086) (113,536) - - (1,766,962) (224,235) (1,991,197) ' 15,537 50,882 134,533 11,571 214,147 (5,987) 208,160 628,197 848,185 1,115,712 38,801 3,120,318 365,190 3,485,508 = (15,000) _ (15,000) (100,000) (100,000) 0 0 0 0 (115,000) 0 (115,000) (309,930) (416,742) (323,343) - (1,050,015) (130,082) (1,180,097) (210,000) - (210,000) - (210,000) - - (25,835) - (25,835) - (25,835) (309,930) (416,742) (559,178) 0 (1,285,850) (130,082) (1,415,932) 31,180 26,473 14,321 3,000 108,354 151,890 260,244 31,180 26,473 14,321 3,000 108,354 151,890 260,244 349,447 457,916 570,855 41,801 1,827,822 386,998 2,214,820 1,541,308 682,184 343,221 84,862 4,157,378 6,514,190 10,671,568 $1,890,755 $1,140,100 $914,076 $126,663 $5,985,200 $6,901,188 $12,886,388 ($109,099) $313,885 $455,382 $41,523 $479,784 ($294,683) $185,101 648,115 479,323 513,608 - 2,276,170 596,702 2,872,872 28,408 (59,593) 4,303 (2,857) (59,781) 5,723 (54,058) (3,481) - - (3,383) 609 (2,774) (138) 10,652 - - 5,959 - 5,959 ' 32,978 52,674 12,436 (11,436) 165,524 60,026 225,550 4,470 362 (4,550) 12,181 2,800 14,981 11,407 - - - 29,717 - 29,717 15,537 50,882 134,533 11,571 214,147 (5,987) 208,160 ' 737,296 534,300 660,330 (2,722) 2,640,534 659,873 3,300,407 $628,197 $848,185 $1,115,712 $38,801 $3,120,318 $365,190 $3,485,508 The accompanying notes are an integral part of these financial statements. ' 49 -This page intentionally left blank- , 50 ' ' CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 Note I SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City of Brooklyn Center,Minnesota(the City)was formed and operates pursuant to applicable Minnesota laws and statutes. The governing body consists of a mayor and four City Council members ' elected at-large to serve four-year staggered terms. A. FINANCIAL REPORTING ENTITY As required by accounting principles generally accepted in the United States of America,the City's financial statements include all funds and departments of the City and the City's component ' units. The component units discussed below are included in the City's reporting entity because of the significance of their operational or financial relationship with the City. BLENDED COMPONENT UNITS ' Blended component units,although legally separate,are in substance,part of the government's operations;data from these units are combined with data of the primary government. ' These additional units are the Economic Development Authority(EDA)and the Housing and Redevelopment Authority(HRA) in and for the City of Brooklyn Center. The governing board for each Authority is the City Council. The Council reviews and approves ' the HRA tax levy and the City provides major community development financing for EDA and HRA activities. Debts issued for EDA and HRA activities are City general obligations. Although the EDA and HRA are legally separate from the City,they are reported as part of the City because the governing boards are the same. Complete financial statements for the EDA and HRA may be ' obtained at the City offices located at 6301 Shingle Creek Parkway,Brooklyn Center,Minnesota 55430 ' JOINT VENTURES AND JOINTLY GOVERNED ORGANIZATIONS The City has several agreements with other entities that provide reduced costs,better service,and additional benefits to the participants. The programs in which the City participates are listed below and amounts recorded within the current year's financial statements are disclosed. Local Government Information Systems Association(LOGIS) This consortium of approximately 30 government entities provides computerized data processing and support services to its members. LOGIS is legally separate;the City does not appoint a voting ' majority of its board,and the Consortium is fiscally independent of the City. The total amount recorded within the 2003 financial statements of the City is$439,311 for general services provided,plus$253,938 in police software application upgrades allocated to the various funds based on applications and/or use of services. Complete financial statements may be obtained at ' the LOGIS offices located at 5750 Duluth Street,Golden Valley,Minnesota 55422. 51 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS ' December 31,2003 Leis Insurance Group ' This group provides cooperative purchasing of health and life insurance benefits for approximately 45 governmental entities. The total of 2003 health and life insurance costs paid by the City was$890,059. Complete financial statements may be obtained from Stanton Group located at 3405 Annapolis Lane,Plymouth,Minnesota 55447. , OTHER The Brooklyn Center Fire Department Relief Association(the Association) The Association is organized as a nonprofit organization, legally separate from the City,by its ' members to provide pension and other benefits to such members in accordance with Minnesota Statutes. Its board of directors is elected by the membership of the Association and not by the City Council. The Association issues its own set of financial statements. All funding is ' conducted in accordance with applicable Minnesota Statutes,whereby state aids flow to the Association,tax levies are determined by the Association and are only reviewed by the City. The Association pays benefits directly to its members. The Association may certify tax levies to Hennepin County directly if the City does not carry out this function. Because the Association is ' fiscally independent of the City,the financial information of the Association has not been included within the City's financial statements. (See Note 15C for disclosures relating to the pension plan operated by the Association:) The City's portion of the costs of the Association's pension benefits is included in the General Fund under public safety. Complete financial ' statements for the Association may be obtained at the City offices located at 6301 Shingle Creek Parkway,Brooklyn Center,Minnesota 55430. B. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS ' The government-wide financial statements(i.e.,the statement of net assets and the statement of ' changes in net assets)report information on all of the nonfiduciary activities of the primary government and its component units. For the most part,the effect of interfund activity has been removed from these statements. 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 business-type activity are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or business-type activity. 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 business-type activity and 2)grants and ' contributions that are restricted to meeting the operational or capital requirements of a particular function or business type activity. Taxes and other items not included among program revenues are reported instead as general 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. ' 52 ' ' CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 1 ' C. MEASUREMENT FOCUS,BASIS OF ACCOUNTING,AND FINANCIAL STATEMENT PRESENTATION The government-wide financial statements are reported using the economic resources ' measurement focus and the accrual basis of accounting,as are the Proprietary Fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred,regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon ' as all eligibility requirements imposed by the provider have been met. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose,the government considers all revenues,except reimbursement ' grants,to be available if they are collected within 60 days of the end of the current fiscal period. Reimbursement grants are considered available if they are collected within one year of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred,as ' under accrual accounting. However,debt service expenditures,as well as expenditures related to compensated absences and claims and judgments,are recorded only when payment is due. Property taxes,special assessments,intergovernmental revenues,charges for services and interest ' associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only ' when cash is received by the government. The government reports the following major governmental funds: ' The General Fund is the government's primary operating fund. It accounts for all financial resources of the general government,except those required to be accounted for in another fund. The Earle Brown TIF District Special Revenue Fund has the authority to collect tax increments which are used for the historic restoration of the Earle Brown Farm and for debt service payments of bonds which were issued for the same purpose. ' The TIF District No. 3 Special Revenue Fund has the authority to collect tax increments which are used for various redevelopment projects within the City and for debt service ' payments of bonds which were issued for the same purpose. The Special Assessment Bonds Debt Service Fund is used to account for the accumulation of resources for the payment of special assessment bonds. These bonds were sold to finance ' certain public improvements such as residential streets and storm sewers or the provision of services which are to be paid for wholly or in part from special assessments levied against benefited property. ' 53 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS ' December 31,2003 The Infrastructure Construction Capital Projects Fund was established to account for the ' resources and expenditures required for the acquisition and construction of capital facilities or improvements financed wholly or in part by special assessments levied against benefited properties. The government reports the following major proprietary funds: , The Municipal Liquor Fund accounts for the operations of the City's municipal off-sale liquor stores. ' The Golf Course Fund accounts for operations of Centerbrook Golf Course,a 9 hole par 3 course owned by the City. The Earle Brown Heritage Center Fund accounts for the operation of a convention center. ' The Earle Brown Heritage Center is a pioneer farmstead that has been historically preserved and restored as a modern multipurpose facility. Its convention center can host conferences, , trade shows,and concerts seating 1,000 people in either banquet or theater style. The facility hosts many meetings,parties,weddings and receptions. The Water Utility Fund accounts for the provision of water to customers. Administration, ' wells,water storage,and distribution are included. The Sanitary Sewer Fund accounts for the collection and pumping of sanitary sewage , through a system of sewer lines and lift stations. Sewage is treated by the Metropolitan Council Environmental Services whose fees represent about 75%of this fund's expenses. The Storm Drainage Fund accounts for the operations and improvements of the storm water ' drainage system. It incorporates not only the storm sewer system,but also water structures such as holding ponds and facilities to improve water quality. Fees are based upon the amount of water running off a property and vary with both size and absorption characteristics of the parcel. ' Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in both the government-wide and proprietary-fund financial statements to ' the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following subsequent private- sector guidance for their business-type activities and enterprise funds,subject to this same limitation. The government has elected not to follow subsequent private-sector guidance. Asa general rule the effect of interfund activity has been eliminated from the government-wide ' g ty g financial statements. Exceptions to this general rule are transactions that would be treated as revenues,expenditures or expenses if they involved external organizations,such as buying goods , and services or payments in lieu of taxes,are similarly treated when they involve other funds of the City of Brooklyn Center. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. 54 ' CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 ' Additionally,the government reports the following fund type: Internal Service Funds account for compensated absences,health care insurance benefits and central garage services provided to other departments of the City on a cost ' reimbursement basis. Amounts reported as program revenues include 1)charges to customers or applicants for goods, ' services,or privileges provided,2)operating grants and contributions,and 3)capital grants and contributions,including special assessments. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise,general revenues include all taxes. 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 fund's principal ongoing operations. The principal operating revenues of the municipal liquor,golf course,Earl Brown Heritage Center, ' water utility,sanitary sewer,storm drainage and street light enterprise funds are charges to customers for sales and services. Operating expenses for enterprise funds include the cost of sales and services,administrative expenses,and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. When both restricted and unrestricted resources are available for an allowable use,it is the government's policy to use restricted resources first,then unrestricted resources as they are ' needed. D. BUDGETS The City Charter grants the City Council full authority over the financial affairs of the City. The City Manager is charged with the responsibility of preparing the estimates of the annual budget ' and the enforcement of the provisions of the budget as specified in the City Charter. Upon adoption of the annual budget resolution by the Council, it becomes the formal appropriation budget for City operations. All budget adjustments must be approved by the Council. Budgets for the General and Special Revenue Funds are adopted on a basis consistent with accounting ' principles generally accepted in the United States of America. Budgeted expenditure appropriations lapse at year end. Encumbrance accounting, under which purchase orders,contracts,and other commitments for the expenditure of monies are recorded in order to reserve that portion of the appropriation, is not employed by the City because it is, at present, not considered necessary to assure effective budgetary control or to facilitate effective cash management. 55 i 1 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS 1 December 31,2003 1 LEGAL COMPLIANCE BUDGETS ' The City follows these procedures establishing the budgetary data reflected in the financial statements: 1. In August,the City Manager submits to the City Council proposed operating budgets for 1 the fiscal year commencing the following January. The operating budgets include expenditures and the means of financing them. 2. The County mails-individual property tax notices showing the taxes that would result 1 from the proposed budgets of all taxing units to each property owner in November. 3. Public hearings are conducted to obtain taxpayer comments. 4. The budgets are legally enacted with the passage of resolutions by the City Council in the 1 month of December. 5. The City Council must authorize any transfer of budgeted amounts between departments within the General Fund. A transfer of budgeted amounts within individual departments must be authorized by the City Manager. 1 6. Supplemental appropriations during the year may only be made by the City Council. These amounts must be financed by funds from the contingency reserve set up in the General Fund or by additional revenues. 7. All budget amounts lapse at the end of the year to the extent they have not been 1 expended or re-encumbered by City Council directive in the following fiscal year. 8. Formal budgetary integration is employed as a management control device during the year for all governmental funds with the exception of Debt Service Funds and Capital 1 Project Funds. Formal budgetary integration is not employed for Debt Service Funds because effective budgetary control is alternatively achieved through general obligation bond indenture provisions. Budgetary control for Capital Projects Funds is accomplished through the use of project controls and project-length budgets. 1 9. Budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America. Annual appropriated budgets are adopted for all governmental funds except for the project-length Capital Projects Funds and Debt Service Funds. i 10. Budgetary control is maintained at the department level for the General Fund and at the fund level for all other governmental funds that adopt annual budgets. 11. Budgeted amounts are as originally adopted,or as amended by the City Council. 1 Individual and aggregate amendments were not material in relation to the original appropriations. BUDGET VARIANCES 1 For the year ended December 31,2003,expenditures exceeded appropriations of the Economic Development Authority and City Initiatives Grant Special Revenue Funds by$73,077 and $340,991,respectively. i 1 1 56 i ' CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 ' E. CASH AND INVESTMENTS Cash balances from all funds are combined and invested to the extent available in certificates of deposit, U.S. government securities and other securities authorized by State Statute. Investment income is allocated to the respective funds on the basis of applicable cash balance participation by each fund. Investments are stated at fair value,based upon quoted market prices as of the balance sheet date. Investment income is accrued at the balance sheet date. The City provides temporary advances to funds that have insufficient cash balances by means of an advance from another fund shown as interfund receivables in the advancing fund,and an interfund payable in the fund with the deficit,until adequate resources are received. These interfund balances are eliminated on the government-wide financial statements. For purposes of the statement of cash flows the City considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. All of the cash and ' investments allocated to the proprietary funds have original maturities of 90 days or less. Therefore the entire balance in the Proprietary Funds are considered cash equivalents. ' F. RECEIVABLES AND PAYABLES During the course of operations,numerous transactions occur between individual funds for goods provided or services rendered. Short-term interfund loans are classified as"interfund receivables/payables." All short-term interfund receivables and payables at December 31,2003 are planned to be eliminated in 2004. Long-term interfund loans are classified as"interfund loan receivable/payable." Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as"internal balances." Property taxes and special assessments have been reported net of estimated uncollectible accounts. (See Note 1 G and I) Because utility bills are considered liens on property,no estimated uncollectible amounts are established. Uncollectible amounts are not material for other receivables and have not been reported. G. PROPERTY TAX REVENUE RECOGNITION ' The City Council annually adopts a tax levy and certifies it to the County in December (levy/assessment date)of each year for collection in the following year. The County is responsible for billing and collecting all property taxes for itself,the City,the local School District and other taxing authorities. Such taxes become a lien on January 1 and are recorded as ' receivables by the City at that date. Real property taxes are payable(by property owners)on May 15 and October 15 of each calendar year. Personal property taxes are payable by taxpayers on February 28 and June 30 of each year. These taxes are collected by the County and remitted to ' the City on or before July 7 and December 2 of the same year. Delinquent collections for November and December are received the following January. The City has no ability to enforce payment of property taxes by property owners. The County possesses this authority. '' ' 57 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS ' December 31,2003 GOVERNMENT-WIDE FINANCIAL STATEMENTS The City recognizes property tax revenue in the period for which the taxes were levied. ' Uncollectible property taxes are not material and have not been reported. GOVERNMENTAL FUND FINANCIAL STATEMENTS ' The City recognizes property tax revenue when it becomes both measurable and available to finance expenditures of the current period. In practice,current and delinquent taxes and State credits received by the City in July,December and January are recognized as revenue for the current year. Taxes collected by the County by December 31 (remitted to the City the following ' January)and taxes and credits not received at the year end are classified as delinquent and due from County taxes receivable. The portion of delinquent taxes not collected by the City in January are fully offset by deferred revenue because they are not available to finance current ' expenditures. H. MARKET VALUE HOMESTEAD CREDIT , Property taxes on residential agricultural homestead property(as defined by State Statutes)are partially reduced by market value homestead credit(MVHC). This credit is paid to the City by the State in lieu of taxes levied against homestead property. The State remits this credit through ' installments each year. The credit is recognized as revenue by the City at the time of collection. The City has recorded this with property tax revenue. I. SPECIAL ASSESSMENT REVENUE RECOGNITION ' Special assessments are levied against benefited properties for the cost or a portion of the cost of special assessment improvement projects in accordance with State Statutes. These assessments are collectible by the City over a term of years usually consistent with the term of the related bond issue. Collection of annual installments(including interest)is handled by the County Auditor in the same manner as property taxes. Property owners are allowed to(and often do)prepay future ' installments without interest or prepayment penalties. Once a special assessment roll is adopted,the amount attributed to each parcel is a lien upon that ' property until full payment is made or the amount is determined to be excessive by the City Council or court action. If special assessments are allowed to go delinquent,the property is subject to tax forfeit sale. Proceeds of sales from tax forfeit properties are allocated first to the County's costs of administering all tax forfeit properties. Pursuant to State Statutes,a property , shall be subject to a tax forfeit sale after three years unless it is homesteaded,agricultural or seasonal recreational land in which event the property is subject to such sale after five years. GOVERNMENT-WIDE FINANCIAL STATEMENTS ' The City recognizes special assessment revenue in the period that the assessment roll was adopted by the City Council. Uncollectible special assessments are not material and have not been ' reported. 58 ' ' CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 ' GOVERNMENTAL FUND FINANCIAL STATEMENTS Revenue from special assessments is recognized by the City when it becomes measurable and available to finance expenditures of the current fiscal period. In practice,current and delinquent special assessments received by the City are recognized as revenue for the current year. Special ' assessments that are collected by the County by December 31 (remitted to the City the following January)and are also recognized as revenue for the current year. All remaining delinquent, deferred and special deferred assessments receivable in governmental funding are completely offset by deferred revenues. J. INVENTORIES GOVERNMENTAL FUNDS The primary government does not maintain material amounts of inventory within the other governmental funds. Inventories of governmental funds are recorded as expenditures when consumed rather than when P urchased. PROPRIETARY FUNDS Inventories in the proprietary funds are valued at cost,using the weighted average method in the Municipal Liquor Fund and the first-in/first-out(FIFO)method in the other proprietary funds. The costs of governmental fund typ e supplies are recorded ded as expenditures when purchased. ' K. PREPAID ITEMS Certain payments to vendors reflect costs applicable to future accounting periods and are recorded ' as prepaid items in both government-wide and fund financial statements. L. CAPITAL ASSETS iCapital assets,which include property,plant,equipment and infrastructure assets(e.g.,roads, bridges,sidewalks,and similar items),are reported in the applicable governmental or business- ' type activities columns in the government-wide financial statements. Capital assets are defined by the government as assets with an initial, individual cost of more than$5,000(amount not rounded) and an estimated useful life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of donation. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized. ' Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business-type activities is ' included as part of the capitalized value of the assets constructed. For the year ended December 31,2003,no interest was capitalized in connection with construction in progress. t 59 CITY OF BROOKLYN CENTER,MINNESOTA ' NOTES TO FINANCIAL STATEMENTS December 31,2003 Property,plant and equipment of the primary government,as well as the component units,is ' depreciated using the straight line method over the following estimated useful lives: Paved streets 25 years Water and sewer mains and lines 25 years ' Buildings and structures 25 years Water wells and storage tanks 25 years Sewer lift stations 25 years ' Street lights and traffic lights 15 years Machinery and equipment 5- 15 years Departmental equipment 5 years M. COMPENSATED ABSENCES It is the City's policy to permit employees to accumulate earned but unused vacation and sick pay ' benefits.All vacation pay is accrued in the internal service fund financial statements. A liability for these amounts is reported in governmental funds only if they have matured,for example,as a result of employee resignations and retirements. In accordance with the provisions of Statement ' of Government Accounting Standards No. 16,Accounting for Compensated Absences, no liability is recorded for nonvesting accumulating rights to receive sick pay benefits. However,a liability is recognized for that portion of accumulating sick leave benefits that is vested as severance pay. N. LONG-TERM OBLIGATIONS In the government-wide financial statements and proprietary fund types in the fund financial ' statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities,business-type activities,or proprietary fund type statement of net assets. Bond premiums and discounts,as well as issuance costs,are immaterial and are , expensed in the year of bond issuance. In the fund financial statements,governmental fund types recognize bond premiums and discounts,as well as bond issuance costs,during the current period: The face amount of debt ' issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs,whether or not withheld from the actual debt proceeds received,are reported as ' debt service expenditures. O. FUND EQUITY ' In the fund financial statements,governmental funds report reservations of fund balance for amounts not appropriable for expenditure or legally segregated for a specific future use. Designated fund balances represent tentative plans for future use of financial resources. ' 60 ' CITY OF BROOKLYN CENTER,MINNESOTA ' NOTES TO FINANCIAL STATEMENTS December 31,2003 P. INTERFUND TRANSACTIONS Interfund services provided and used are accounted for as revenues,expenditures or expenses. Transactions that constitute reimbursements to a fund for expenditures/expenses initially made from it that are properly applicable to another fund are recorded as expenditures/expenses P P Y Pp in the ' reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed. Interfund loans are reported as an interfund loan receivable or payable which offsets the movement of cash between funds. All other interfund transactions are reported as transfers. Q. USE OF ESTIMATES ' The preparation of financial statements in accordance with generally accepted accounting principles(GAAP)requires management to make estimates that affect amounts reported in the financial statements during the reporting period. Actual results could differ from such estimates. R. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS ' 1. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND BALANCE SHEET AND THE GOVERNMENT-WIDE STATEMENT OF NET ' ASSETS The governmental fund balance sheet includes a reconciliation between fund balance—total governmental fiends and net assets—governmental activities as reported in the government- ' wide statement of net assets. One element of that reconciliation explains that"long-term liabilities, including bonds payable,are not due and payable in the current period and therefore are not reported in the funds." The details of this$17,006,538 difference are as follows: Bonds payable $16,930,000 Accrued interest payable 76,538 tNet adjustment to reduce fund balance-total governmental funds to arrive at net assets- governmental activities $17,006,538 61 CITY OF BROOKLYN CENTER,MINNESOTA ' NOTES TO FINANCIAL STATEMENTS December 31,2003 2. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL ' FUND STATEMENT OF REVENUES,EXPENDITURES.AND CHANGES IN FUND BALANCES AND THE GOVERNMENT-WIDE STATEMENT OF ACTIVITIES The governmental fund statement of revenues,expenditures,and changes in fund balances ' includes a reconciliation between net changes in fund balances—total governmental funds and changes in net assets of governmental activities as reported in the government-wide statement of activities. One element of that reconciliation explains that"Governmental funds report capital outlays as expenditures. However,in the statement of activities the cost of ' those assets is allocated over their estimated useful lives and reported as depreciation expense." The details of this$323,269 difference are as follows: Capital outlay $1,870,441 ' Depreciation expense (1,547,172) Net adjustment to increase net changes in fund ' balances-total governmental funds to arrive at changes in net assets of governmental activities $323,269 Another element of that reconciliation states that"Revenues in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds." The details of this($402,575)difference are as follows: ' General property taxes deferred revenue: At December 31,2002 ($329,237) ' At December 31,2003 391,585 Tax increment taxes deferred revenue: At December 31,2002 (149,721) ' At December 31,2003 288,475 Special assessments deferred revenue: ' At December 31,2002 (4,083,171) At December 31,2003 3,491,475 Other deferred revenues: ' At December 31,2002 (48,412) At December 31,2003 36,431 Net adjustments to decrease net changes in fund balances- total governmental funds to arrive at changes in net assets of governmental activities ($402,575) ' 62 , CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 ' Another element of that reconciliation states that"the issuance of long-term debt(e.g.,bonds, leases)provides current financial resources to governmental funds,while the repayment of principal of the long-term debt consumes the current financial resources of governmental funds." Neither transaction,however,has any effect on net assets. The details of this ' $2,015,000 difference are as follows: Debt issued or incurred: ' Issuance of general improvement bonds ($1,205,000) Principal repayments: General obligation debt 705,000 General improvement bonds 870,000 ' Tax increment bonds 1,645,000 Net adjustment to increase net changes in ' fund balances-total governmental funds to arrive at changes in net assets of governmental activities $2,015,000 Note 2 DEPOSITS AND INVESTMENTS ' DEPOSITS In accordance with Minnesota Statutes,the City maintains deposits at those depository banks authorized by the City Council. All such depositories are members of the Federal Reserve System. Minnesota Statutes require that all City deposits be protected by insurance,surety bond,or collateral. The market value of collateral pledged must equal 110%of the deposits not covered by insurance or ' bonds. Authorized collateral includes the legal investments described below,as well as certain first mortgage ' notes,and certain other state or local government obligations. Minnesota Statutes require that securities pledged as collateral be held in safekeeping by the City Treasurer or in a financial institution other than that furnishing the collateral. 63 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 Balances at December 31,2003 are as follows: ' Carrying Bank Amount Balance 1) Insured or collateralized by securities held by the City ' or its agent in the City's name. $581,506 $528,982 2) Collateralized with securities held by the pledging ' institution trust department in the City's name. - - 3) Uncollateralized or collateralized with securities not in ' the City's name. - - Totals $581,506 $528,982 ' INVESTMENTS ' Minnesota Statutes authorize the City to invest in the following: a) Direct obligations or obligations guaranteed by the United States or its agencies, its ' instrumentalities or organizations created by an act of congress,excluding mortgage-backed securities defined as high risk. b) Shares of investment companies registered under the Federal Investment Company Act of 1940 ' and whose only investments are in securities described in(a)above,general obligation tax-exempt securities,or repurchase or reverse repurchase agreements. c) General obligations of the State of Minnesota or any of its municipalities. ' d) Bankers acceptance of United States banks eligible for purchase by the Federal Reserve System. e) Commercial paper issued by United States corporations or their Canadian subsidiaries,of the highest quality,and maturing in 270 days or less. f) Repurchase or reverse repurchase agreements with banks that are members of the Federal Reserve ' System with capitalization exceeding$10,000,000; a primary reporting dealer in U.S.government securities to the Federal Reserve Bank of New York;certain Minnesota securities broker-dealers; or,a bank qualified as a depositor. 64 ' CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 ' Balances at December 31,2003: Carrying/Fair Custodial Credit Risk Category Value ' Securities Type 1 2 3 Amount Federal agencies $31,913,022 $ - $ - $31,913,022 ' Totals $31,913,022 $0 $0 31,913,022 Investment pools 3,962,926 Deposits 581,506 tTotal deposits and investments 36,457,454 Petty cash and change 4,375 ' Totals $36,461,829 ' The City's investments are categorized above to give an indication of the level of custodial credit risk assumed at year end. Category 1 includes investments that are insured or registered or for which the securities are held by the City or its agent in the City's name. Category 2 includes uninsured and unregistered investments for which the securities are held by the counterparty's trust department or ' agent in the City's name. Category 3 includes uninsured and unregistered investments for which the securities are held by the counterparty or by its trust department or agent but not in the City's name. ' Note 3 RECEIVABLES Significant receivables balances not expected to be collected within one year of December 31,2003 are as ' follows: Major Funds Earle TIF Special Special Brown TIF District Assessment Assessment Water Sanitary Storrs Nonmajor ' General District No.3 Bonds Construction Utility Sewer Drainage Funds Total Special assessments receivable $ $ $ $2,300,598 $298,020 $188,210 $2,324 $5,910 $ $2,795,062 Delinquent propertv taxes 71,309 - - _ _ 10,491 81,800 Delinquent tax increment - 116,856 172,625 - _ _ _ _ 289,481 Loan receivable 105,074 - - _ - - - 2.188.038 2,293,112 ' $176,383 1116,856 $172,625 $2.300,598 $298,020 $188,210 $27324 $5,910 $2,198.529 $5,459,455 - ' 65 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS ' December 31,2003 Governmental funds report deferred revenue in connection with receivables for revenues that are not ' considered to be available to liquidate liabilities of the current period. Governmental funds also defer revenue recognition in connection with resources that have been received,but not yet earned. At the end of the current fiscal year,the various components of deferred revenue and unearned revenue reported in the governmental funds were as follows: , Unavailable Unearned Delinquent property taxes receivable(General Fund) $341,364 $ ' Delinquent property taxes receivable(Special Assessment Bonds) 10,267 - Delinquent property taxes receivable(Nonmajor Funds) 39,954 - Delinquent tax increment collections(Earl Brown TIF District) 115,850 Delinquent tax increment collections(TIF District#3) 172,625 Special assessments not yet due(Special Assessment Bonds) 3,092,247 Special assessments not yet due(Special Assessment Construction) 399,227 - Grant drawdowns prior to meeting all eligibility requirements(Nonmajor Funds) - 19,555 ' Fees received but unearned(General Fund) 71 - Fees received but unearned(Special Assessment Construction) 36,360 Total deferred/uneamed revenue for governmental funds $4,207,965 $19,555 ' Note 4 CAPITAL ASSETS Capital asset activity for the year ended December 31,2003 as previously reported was as follows: Beginning ' Beginning Balance Internal Ending Primary Government Balance Restated as Restated Service Increases Decrease Balance Governmental activities: Capital assets,not being depreciated Land $3,298,904 $ - $3,298,904 $ - $ - ($95,000) $3,203,904 Construction in progress 1,150.406 1,150,406 927,629 (1,150,406) 927,629 Total capital assets,not being depreciated 3,298,904 11150,406 4,449,310 0 927,629 (1,245,406) 4,131,533 Capital assets,being depreciated Buildings and improvements 18,525,070 - 18,525,070 - t68,828 - 18,693,898 ' Park improvements 2,906,141 - 2,906,141 - 3,320 - 2,909,461 Departmental equipment 345,746 - 345,746 5,816,573 49,693 - 6,212,012 Streets 16,845 621 16.845,621 1,871377 18,716,998 Total capital assets,being depreciated 21,776,957 16.845,621 38,622,578 5,816,573 2,093,218 0 46,532,369 Less accumulated depreciation for ' Buildings and improvements - 3,998,652 3,998,652 - 654,593 - 4,653,245 Park improvements - 1,648,668 1,648,668 - 115,218 1,763,886 Departmental equipment - 170,041 170,041 3,578,243 28,681 - 3,776,965 Streets 7,981,465 7,981,465 748,680 - 8,730,145 Total accumulated depreciation 0 13,798,826 13,798.826 3,578,243 1,547,172 0 18,924,241 Total capital assets being depreciated-net 21,776,957 3,046,795 24,823,752 2,238,330 546,046 0 27,608.128 ' Governmental activities capital assets-net $25 075,861 $4,197.201 $29,273,062 $2,238,330 $1,473.675 ($1,245,406) $31,739,661 66 ' CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 Beginning Ending Primary Government Balance Increases Decrease Balance Business-type activities: Capital assets,not being depreciated: Land $3,197,342 $ $ $3,197,342 Land improvements 368,088 368,088 Total capital assets,not being depreciated 3,565,430 0 0 3,565,430 ' Capital assets,being depreciated: Buildings and improvements 17,328,964 66,714 17,395,678 Department equipment 617,505 - 617,505 Mains and lines 37,157,768 983,299 38,141,067 ' Total capital assets,being depreciated 55,104,237 1,050,013 0 56,154,250 Less accumulated depreciation for: Buildings and improvements 4,521,365 753,480 5,274,845 Department equipment 222,964 66,678 = 289,642 Mains and lines 14,350,566 1,456,012 15,806,578 Total accumulated depreciation 19,094,895 2,276,170 0 21,371,065 ' Total capital assets being depreciated-net 36,009,342 (1,226,157) 0 34,783,185 Business-type activities capital assets-net $39,574,772 ($1,226,157) $0 $38,348,615 Depreciation expense was charged to functions/programs of the primary government as follows: Governmental activities: ' General government $83,334 Public safety 396,434 Public works 821,285 ' Community services 133,784 Parks and recreation 112,335 Capital assets held by the governments internal service ' funds are charged to the various functions based on their usage of the assets 596,702 Total depreciation expense-governmental activities $2,143,874 ' Business-type activities: Municipal liquor fund $35,580 Golf course fund 27,912 Earle Brown Heritage Center Fund 571,632 Water utility fund 648,115 Sanitary sewer fund 479,323 ' Storm drainage fund 513,608 Total depreciation expense-business-type activities $2,276,170 1 ' 67 1 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 CONSTRUCTION COMMITMENTS At December 31,2003,the City had construction project contracts in progress. The commitments ' related to the remaining contract balances are summarized as follows: Contract Remaining , Project# Project Amount Commitment 2003-1 Happy Hollow Streets $1,347,579 $114,013 Note 5 OPERATING LEASES ' The City leases space for its municipal liquor stores. The leases are both ten-year leases and began in 2000 and 2003. Both leases have options for a ten-year extension. The leases provide for a minimum monthly ' base rent payment,plus a pro-rata share of common area expenses. In addition,they requires additional lease payments if agreed-upon revenue thresholds are attained. These leases may be cancelled at the City's option if the City ceases liquor operations. Total rental expense under the lease agreements for the years ended December 31,2003 and 2002 was$142,730 and$158,702,respectively. Future minimum rent payments under the current agreements are as follows: Total Year Minimum Ending Rents 2004 $184,710 ' 2005 188,897 2006 193,530 2007 193,530 2008 193,530 ' 2009 193,530 2010 136,158 2011 93,360 2012 93,360 2013 93,360 $1,563,965 68 , t ' CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 Note 6 LONG-TERM DEBT The City issues general obligation bonds and equipment certificates to provide funds for the acquisition and construction of major capital facilities. The reporting entity's long-term debt is segregated between the 1 amounts to be repaid from governmental activities and amounts to be repaid from business-type activities. GOVERNMENTAL ACTIVITIES As of December 31,2003,the long-term debt of the financial reporting entity consisted of the following: Final Interest Maturity Original Payable Rates Date Date Issue 12/31/03 General Obligation Bonds: Refunding State-Aid Street Bonds 3.55%4.00% 12/1/1998 4/1/2006 $1,585,000 $845,000 1 Police and Fire Building Bonds 4.10%4.90% 12/1/1997 2/1/2013 7,900,000 5,875,000 Total General Obligation Bonds 9,485,000 6,720,000 G.O.Tax Increment Bonds: Tax Increment Bonds of 1991 4.70'/-6.00% 311/1991 2/1/2004 6,050,000 1,425,000 Taxable Tax Increment Bonds of 1995 6.00%6.75% 11/1/1995 2/1/2011 4,560,000 3,080,000 Total Tax Increment Bonds 10,610,000 4,505,000 G.O.Improvement Bonds: 1994 Street Improvement Bonds 4.10%5.50% 8/1/1994 2/1/2005 835,000 185,000 ' 1995 Street Improvement Bonds 4.00%4.90% 1 1/1/1995 2/1/2006 780,000 260,000 1996 Street improvement Bonds 4.20'/-5.10% 1 1/1/1996 2/1/2007 1,440,000 620,000 1997 Street Improvement Bonds 4.00'/-4.70'/. 12/1/1997 2/1/2008 1,075,000 510,000 1998 Street Improvement Bonds 3.40%4.20% 12/1/1998 2/1/2009 1,085,000 615,000 1999 Street Improvement Bonds 4.10%5.00% 12/1/1999 2/1/2010 1,585,000 1,090,000 ' 2000 Street Improvement Bonds 4,30o/-4.90`/` 12/1/2000 2/1/2011 735,000 575,000 2001 Street Improvement Bonds 2.60%4.40% 12/1/2001 2/1/2012 730,000 645,000 2003 Street Improvement Bonds 1.45'/-4.00% I/1/2003 2/1/2013 1,205,000 1,205,000 Total G.O.Improvement Bonds 9,470,000 5,705,000 ' Total-bonded indebtedness 29,565,000 16,930,000 Compensated absences payable 783,227 Total City indebtedness-governmental activities $29,565,000 $17,713,227 BUSINESS-TYPE ACTIVITIES Final Interest Maturity Original Payable Rates Date Date Issue 12/31/03 G.O.Revenue Bonds: 1994 Storm Sewer Revenue Bonds 4.20'/-5.40% 8/1/1994 2/1/2005 $1,830,000 $450,000 Total business-type activities $1,830,000 $450,000 69 1 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS 1 December 31,2003 Annual debt service requirements to maturity for long-term debt are as follows: 1 General Obligation Bonds Tax Increment Bonds G.O.Improvement Bonds Year Ending Governmental Activities Governmental Activities Governmental Activities December 31 Principal Interest Principal Interest Principal Interest 2004 $740,000 $292,317 $1,775,000 $237,302 $1,005,000 $218,457 2005 775,000 260,374 360,000 171,122 990,000 178,598 2006 810,000 226,403 360,000 147,362 880,000 138,451 2007 540,000 196,640 385,000 122,584 790,000 103,034 ' 2008 565,000 171,219 385,000 96,694 615,000 73,147 2009 595,000 144,100 400,000 70,200 510,000 49,538 2010 625,000 115,274 415,000 42,694 395,000 30,052 2011 655,000 84,710 425,000 14,344 240,000 16,336 1 2012 690,000 52,257 - - 175,000 7,748 2013 725,000 17,762 105,000 2,100 Total $6,720,000 $1,561,056 $4,505,000 $902,302 $5,705,000 $817,461 Storm Sewer Revenue Bonds Year Ending Business-Type Activities 1 December 31 Principal Interest 2004 $220,000 $18,250 2005 230,000 6,210 ' Total $450,000 $24,460 1 1 i 1 1 1 70 1 ' CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 CHANGE IN LONG-TERM LIABILITIES Long-term liability activity for the year ended December 31,2003,was as follows: ' Beginning Ending Due Within Balance Additions Reductions Balance One Year Governmental activities: Bonds payable: ' General obligation bonds $7,425,000 $ _ ($705,000) $6,720,000 $740,000. Tax increment bonds 6,150,000 (1,645,000) 4,505,000 1,775,000 G.O.special assessment bonds 5,370,000 1,205,000 (870,000) 5,705,000 1,005,000 Total bonds payable 18,945,000 1,205,000 (3,220,000) 16,930,000 3,520,000 ' Compensated absences 714,914 618,713 (550,400) 783,227 783,227 Total government activity long-term liabilities $19,659,914 $1,823,713 ($3,770,400) $17,713,227 $4,303,227 Business-type activities Storm sewer revenue bonds $660,000 $0 ($210,000) $450,000 $220,000 ' For the governmental activities,loans payable are generally liquidated by the general fund. Compensated absences are liquidated by the Internal Service Fund. All long-term bonded indebtedness outstanding at December 31,2003 is backed by the full faith and credit of the City, including improvement and revenue bond issues. Delinquent assessments receivable at December 31,2003 totaled$87,807. ' Note 7 CONDUIT DEBT OBLIGATIONS From time to time,the City has issued Housing Revenue Bonds and Industrial Revenue Bonds to provide ' assistance to private sector entities for the acquisition and construction of housing, industrial,and commercial facilities deemed to be in the public interest. The bonds are secured by the property financed and are payable solely from payments received on the underlying mortgage loans. Upon repayment of the ' bonds,ownership of the acquired facilities transfers to the private sector entity served by the bond issue. Neither the City,the State,nor any political subdivision thereof is obligated in any manner for the repayment of the bonds. Accordingly,the bonds are not reported as liabilities in the accompanying financial statements. ' As of December 31,2003,there were six series of Housing Revenue or Industrial Revenue Bonds outstanding,with an aggregate principal amount payable$28,650,000. Several variable debt issues are also outstanding. ' 71 CITY OF BROOKLYN CENTER,MINNESOTA ' NOTES TO FINANCIAL STATEMENTS December 31,2003 Note 8 RESERVED/DESIGNATED FUND EQUITY Fund balances and retained earnings in the various funds have been reserved or designated for the , following purposes: Reserved Fund Equity ' Fund balances: Major funds: ' General fund: Prepaid items $5,309 Advances to other funds 105,074 ' Total general fund 110,383 Special Assessment Bonds: Debt service 2,976,874 Nonmajor Funds: Loan receivable 2,188,038 ' Debt service 2,344,403 Total nonmajor funds 4,532,441 Total governmental funds $7,619,698 Designated Fund Equity ' Major funds: General fund: Working capital $6,031,077 TIF District#3: Statutory housing obligation 1,769,895 Total governmental funds $7,800,972 f 72 ' CITY OF BROOKLYN CENTER,MINNESOTA ' NOTES TO FINANCIAL STATEMENTS December 31,2003 Note 9 INTERFUND RECEIVABLES/PAYABLES LOANS AND TRANSFERS Individual fund interfund receivable and payable balances at December 31,2003 are as follows: ' Due from Due to Fund Other Funds Other Funds Major Funds: ' TIF District#3 $1,043,323 $ - Earl Brown TIF District - 1,043,323 ' Nonmajor Governmental Funds: Capital Reserve Emergency Fund 158,933 Municipal State Aid for Construction Fund - 158,933 Total $1,202,256 $1,202,256 ' Advances to Advances From Fund Other Funds Other Funds Major Funds: General Fund $105,074 $ Earl Brown TIF District - 698,143 ' Infrastructure Construction = 709,969 Golf Course 885,000 Non-Major Funds: ' Capital Emergency Reserve Fund 709,969 - Capital Improvements Fund 885,000 Municipal State Aid for Construction Fund 593,069 - $2,293,112 $2,293,112 The above balances are not expected to be eliminated within one year of December 31,2003. ' ' 73 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS , December 31,2003 Interfund transfers: Transfer In Transfer Out Governmental Funds: ' Major Funds: General Fund $ - $2,194,655 Earl Brown TIF District - 653,000 TIF District No.3 - 548,000 ' Special Assessment Bonds 259,079 - Infrastructure Construction 480,000 - Nonmajor Funds 2,964,430 207,854 , Total govenmental funds 3,703,509 3,603,509 Proprietary Funds: Enterprise Municipal Liquor - 100,000 Total $3,703,509 $3,703,509 , Interfund transfers allow the City to allocate financial resources to the funds that receive benefit from services provided by another fund or to provide additional capital and infrastructure funding. All of the City's interfund transfers fall under that category. All of the 2003 transfers are considered routine and consistent with previous practices. 74 1 1 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 1 Note 10 LEGAL DEBT MARGIN The City is subject to a statutory limitation by the State of Minnesota for bonded indebtedness payable principally from property taxes. The City of Brooklyn Center's legal debt margin for 2003 and 2002 is 1 computed as follows: December 31, ' 2003 2002 Market value(after fiscal disparities) $1,840,115,300 $1,673,812,000 1 Debt limit (2%of Market Value) $36,802,306 $33,476,240 Amount of debt applicable to debt limit: Total bonded debt $17,380,000 $19,605,000 Less: Special assessment bonds (5,705,000) (5,370,000) State Aid Street Bonds (845,000) (1,100,000) Tax Increment Bonds (4,505,000) (6,150,000) Utility Revenue Bonds (450,000) (660,000) Total debt applicable to debt limit $5,875,000 $6,325,000 Legal debt margin $30,927,306 $27,151,240 Note 11 DEFICIT FUND BALANCES A deficit fund balance exists at December 31,2003 in the following fund: ' Major Funds: Earle Brown Tax Increment Financing District: Unreserved deficit fund balance $1,685,368 ' The deficit is being funded through internal borrowing and will be re aid fr om future surplus t ax increments. 1 75 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 Note 12 CONTINGENCIES,SUBSEQUENT EVENTS AND COMMITMENTS A. ARBITRAGE REBATE The Tax Reform Act of 1986 requires governmental entities to pay to the federal government income earned on the proceeds from the issuance of debt in excess of interest costs,pending the expenditure of the borrowed funds. This rebate of interest income(known as arbitrage)applies to governmental debt issued after August 31, 1986. The City issued greater than$5 million of bonds in the years 1991, 1992 and 1997 and therefore is ' required to rebate excess investment income relating to these issues to the federal government. The extent of the City's liability for arbitrage rebates on the remaining bond issues is not determinable at this time. However, in the opinion of management,any such liability would be immaterial. B. LITIGATION The City is subject to certain legal claims in the normal course of business. Management does not expect the resolution of these claims will have a material impact on the City's financial condition or results of operations. C. FEDERAL AND STATE FUNDS ' Amounts received or receivable from federal and state agencies are subject to agency audit and adjustment. Any disallowed claims,including amounts already collected,may constitute a ' liability of the applicable funds. The amount,if any,of funds which may be disallowed by the agencies cannot be determined at this time although the City expects such amounts,if any,to be immaterial. D. TAX INCREMENT DISTRICTS The City's tax increment districts are subject to review by the State of Minnesota Office of the State Auditor(OSA). Any disallowed claims or misuse of tax increments could become a liability of the applicable fund. Management has indicated that they are not aware of any instances of noncompliance which would have a material effect on the financial statements. E. PROGRAM COMPLIANCE Federal program activities are subject to financial and compliance regulation. To the extent that , any expenditures are disallowed or other compliance features are not met,a liability to the respective grantor agency could result. 76 ' ' CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 F. GRANTS ' The City approved grants in the amount of$500,000 to Boca Limited g Partnership. The rant requires repayment if certain requirements are not met. In turn,the City would be required to ' return the funds to Hennepin County. G. SUBSEQUENT EVENTS On April 4,2004 the City sold two new bond issues;$5,045,000 General Obligation Police and Fire Building Refunding Bonds, Series 2004A and$2,470,000 Taxable General Obligation Tax ' Increment Refunding Bonds,Series 2004B. In January 2004 the City opened a second municipal liquor store. ' H. CONTINGENT LIABILITY ' The City entered into two limited tax increment notes with developers whereby the City shall pay the developers the lesser of the scheduled payment or available tax increment. Whether a payment will occur and if so,the amount of the payment(s)are uncertain since all payments are dependent on the City receiving tax increment from the developer's project. As such,this liability has not been recorded in the financial statements. A schedule of the notes outstanding at December 31,2003 is as follows: Original 12/31/2003 Interest Maturity Note Principal Balance Rate Date Twin Lakes business Park $1,000,000 $ - 8.00% 8/1/2003 ' Twin Lakes business Park 2,169,938 2,113,429 8.00% *No maturity date is set. Payments will continue until the principal is paid,or for 10 years,whichever comes first. ' 77 1 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS 1 m leco y er 31 2003 Note 13 RISK MANAGEMENT 1 The City is exposed to various risks of loss related to torts;theft of,damage to and destruction of assets; errors and omissions and natural disasters for which the City carries commercial insurance policies. The City retains risk for the deductible portions of the insurance policies. The amount of these deductibles is 1 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. ' Note 14 POST-EMPLOYMENT HEALTH CARE BENEFITS The City has provided post-employee health care benefits,as per the requirements of the City Council 1 resolution,for certain retirees and their dependents since 1986. Full time employees have the option of retaining membership in the City's health insurance plan for which the City will pay the single person , premium until such time as the retiree is eligible for Medicare coverage or at age 65,whichever is sooner. If the retiree desires to continue family coverage,the additional cost for family coverage shall be paid by the retiree to the City. There are two methods whereby an employee can qualify under this program. First, the employee,on the date of his/her retirement,must meet eligibility requirements for a full retirement ' annuity under PERA(Note 15A)without reduction of benefits because of age,disability,or any other reason for reduction. In addition,the employee must have been employed full time by the City for the last ten consecutive years prior to the effective date of retirement. Additionally,employees who are retiring after twenty-five years of consecutive service with the City and are eligible to receive a pension from PERA shall have the option of retaining membership in the City's health insurance plan for which the 1 employee will pay the premium until such time as the retiree is eligible to receive a full-retirement annuity under PERA or PERA police. At that time,the City will pay the single-person premium until such time as 1 the retiree is eligible for Medicare coverage or at age 65,whichever is sooner. Employees participate in this program on a voluntary basis. As of December 31,2003, 11 employees currently participate in this program. The cost of City paid health ' care premiums for the years ended December 31,2003 and 2002 was$38,615 and$25,896,respectively. Fund liabilities are paid on a pay-as-you-go basis with investment earnings of the Fund. The$1,547,235 recorded as a liability is not an actuarially determined amount,but the City's best estimate of the future liability. The liability will remain unchanged until a thorough analysis of future liabilities is performed. 1 i 1 1 78 1 ' CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31,2003 Note 15 DEFINED BENEFIT PENSION PLANS-STATEWIDE A. STATEWIDE-PERA ' PLAN DESCRIPTION All full-time and certain part-time employees of the City are covered by defined benefit plans administered by the Public Employees Retirement Association of Minnesota(PERA). PERA administers the Public Employees Retirement Fund(PERF)and the Public Employees Police and Fire Fund(PEPFF)which are cost-sharing,multiple-employer retirement plans. These plans are established and administered in accordance with Minnesota Statute,Chapters 353 and 356. ' PERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated Plan members are covered by Social Security and Basic Plan members are not. All new members must participate in the Coordinated Plan. All police officers,firefighters and peace officers who qualify for membership by statute are covered by the PEPFF. PERA provides retirement benefits as well as disability benefits to members,and benefits to survivors upon death of eligible members. Benefits are established by State Statute,and vest after three years of ' credited service. The defined retirement benefits are based on a member's highest average salary for any five successive years of allowable service,age,and years of credit at termination of service. The benefit provisions stated in the previous paragraphs of this section are current provisions and apply to active plan participants. Vested,terminated employees who are entitled to benefits but are not receiving them yet are bound by the provisions in effect at the time they last terminated their public service. ' PERA issues a publicly available financial report that includes financial statements and required supplementary information for PERF and PEPFF. That report may be obtained by writing to PERA, ' 60 Empire Drive 4200,St.Paul,Minnesota,55103-2088 or by calling(651)296-7460 or 1-800-652- 9026. ' FUNDING POLICY Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. These statutes are established and amended by the state legislature. The City makes annual contributions to the pension plans equal to the amount required by state statutes.PERF Basic Plan members and Coordinated Plan members are required to contribute 9.10%and 5.10%,respectively,of their annual covered salary. PEPFF members are required to contribute 6.20%of their annual covered salary. The City is required to contribute the following percentages of annual covered payroll: ' 11.78%for Basic Plan PERF members,5.53%for Coordinated Plan PERF members,and 9.30% for PEPFF members. The City's contributions to the Public Employees Retirement Fund for the years ending December 31,2003,2002 and 2001 were$309,237,$299,954 and$296,052, ' respectively. The City's contributions to the Public Employees Police and Fire Fund for the years ending December 31,2003,2002 and 2001 were$257,234,$255,923 and$239,799,respectively. 79 CITY OF BROOKLYN CENTER,MINNESOTA ' NOTES TO FINANCIAL STATEMENTS December 31,2003 The City's contributions were equal to the contractually required contributions for each year as set , by state statute. B. PENSION PLAN—BROOKLYN CENTER FIRE DEPARTMENT RELIEF ASSOCIATION PLAN DESCRIPTION The City contributes to the Brooklyn Center Fire Department Relief Association(the Association) which is the administrator of a single employer retirement system to provide a retirement plan(the Plan)to volunteer firefighters of the City who are members of the Association. The Association ' issues a financial report which is available at City offices. FUNDING POLICY AND ANNUAL PENSION COST The City levies property taxes at the direction of and for the benefit of the Plan and passes through ' state aids allocated to the Plan,all in accordance with enabling State statutes. The minimum tax levy obligation is the financial contribution requirement for the year less anticipated state aids. ' CONTRIBUTIONS Total contributions to the plan in 2002 were 118,508,of which$16,239 was levied by the City of Brooklyn Center and$102,269 was from the State of Minnesota. The actuarially determined contribution based on an actuarial valuation performed at January 1,2003 was$111,821,which represents funding for normal cost of$90,148 and administration of$21,673. Actual contributions have continued at higher levels to allow for a transition to a defined contribution , plan in the future. These higher payments are irrevocable and do not affect the level of future City contributions. They do not constitute an asset of the City. The information below is the most recent data available. ' Actuarial valuation date 1/1/2003 Actuarial cost method Entry age normal cost method Amortization method Level dollar amount amortized on a closed basis Remaining amortization period 18 years Actuarial assumptions: Investment rate of return 7.5%compounded annually Discount rate for obligations 7.50% Projected salary increases Not applicable ' Post retirement benefits None Inflation rate Not applicable 1 1 80 1 CITY OF BROOKLYN CENTER,MINNESOTA ' NOTES TO FINANCIAL STATEMENTS December 31,2003 ' THREE-YEAR TREND INFORMATION Three Year Trend Information Annual Percentage Net Year Pension of APC Pension Ending Cost(APC) Contributed Obligation 12/31/200 $96,617 100% $0 12/31/2001 118,508 100% 0 12/31/2002 118,508 100% 0 SCHEDULE OF FUNDING PROGRESS ' Assets in Excess of Actuarial Actuarial Actuarial (Unfunded) Valuation Value of Accrued Accrued Funded ' Date Assets Liability Liability Ratio 12/31/2000 $3,078,163 $2,457,135 $621,028 125.30% ' 12/31/2001 2,925,352 2,608,543 316,809 112.10% 12/31/2002 2,540,231 2,478,786 61,445 102.50% ' RELATED PARTY INVESTMENTS ' As of December 31,2003,the Association held no securities issued by the City or other related parties. Note 16 FUND CHANGES The following funds were opened during 2003: ' Capital Projects: Street Reconstruction Fund Technology Fund 81 CITY OF BROOKLYN CENTER,MINNESOTA NOTES TO FINANCIAL STATEMENTS ' December 31,2003 Note 17 CHANGE IN ACCOUNTING PRINCIPLE In June 1999,the Governmental Accounting Standards Board(GASB)approved Statement No.34,Basic ' Financial Statements—and Management's Discussion and Analysis—for State and Local Governments. The City is required to implement GASB 34 no later than the year ended December 31,2003. The City ' elected to implement GASB 34,including the infrastructure—related portion,during 2003. The most significant effects of implementing GASB 34 during 2003 are as follows: • Government-wide financial statements are prepared using full accrual accounting for all the City's ' activities. • Infrastructure and construction in progress for governmental activities has been capitalized and all capital assets are depreciated on the government-wide financial statements. See Note 4 for restatement of previously reported amounts. • The basic fund financial statements focus on major funds rather than fund types. • A Management Discussion and Analysis(MD&A)is included as required supplementary information. , These and other changes are reflected in the accompanying financial statements(including notes to the financial statements). The City also implemented the following pronouncements during 2002,which did not have a material , effect on the accompanying financial statements: • GASB Statement 36,Recipient Reporting for Certain Shared Nonexchange Revenues—an , Amendment to GASB Statement 33 • GASB Statement 37,Basic Financial Statements—and Management's Discussion and Analysis- for State and Local Governments: Omnibus—an Amendment of GASB Statements No.21 and , No.34. • GASB Statement 38,Certain Financial Statement Note Disclosures • GASB Statement 41,Budgetary Comparison Schedules—Perspective Differences 82 , REQUIRED SUPPLEMENTARY INFORMATION ' 83 CITY OF BROOKLYN CENTER,MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION Statement 9 BUDGETARY COMPARISON SCHEDULE-GENERAL FUND Page 1 of 6 For The Year Ended December 31,2003 , Variance with ' Final Budget- Budgeted Amounts Actual Positive Revenues: Original Final Amounts (Negative) ' Taxes: Property taxes and market value homestead credit $9,837,474 $9,837,474 $10,131,993 $294,519 Penalties and interest - - 5,814 5,814 ' Lodging tax 700,000 700,000 661,267 (38,733) Total taxes 10,537,474 10,537,474 10,799,074 261,600 Licenses and permits: Liquor and beer 107,500 107,500 116,848 9,348 ' Building permits 310,000 310,000 451,839 141,839 Mechanical permits 50,000 50,000 89,523 39,523 Sewer and water permits 1,000 1,000 2,520 1,520 ' Plumbing permits 35,000 35,000 59,730 24,730 Garbage licenses 3,000 3,000 3,020 20 Taxicab licenses 500 500 1,400 900 Mechanical licenses 4,500 4,500 6,779 2,279 ' Pawn shop licenses 12,000 12,000 12,000 - Service station licenses 2,500 2,500 2,660 160 Vehicle dealer licenses 2,000 2,000 1,750 (250) , Bowling licenses 720 720 720 - Cigarette licenses 3,500 3,500 4,169 669 Sign permits 3,000 3,000 3,561 561 ' Rental dwelling permits 68,000 68,000 46,925 (21,075) Amusement licenses 2,000 2,000 1,995 (5) ROW permits 5,000 5,000 12,792 7,792 ' Miscellaneous business license 2,500 2,500 9,454 6,954 Total licenses and permits 612,720 612,720 827,685 214,965 Intergovernmental: State: ' Local government aid 2,501,033 2,501,033 1,319,661 (1,181,372) Police pension aid 250,000 250,000 255,478 5,478 PERA aid 34,365 34,365 34,365 - ' Fireperson pension aid 92,500 92,500 124,123 31,623 Police training 15,000 15,000 17,382 2,382 E-911 phone service 15,000 15,000 19,908 4,908 Street maintenance aid 30,000 30,000 90,000 60,000 Low income housing aid 59,887 59,887 59,887 - Miscellaneous grants 1,400 1,400 27,653 26,253 Total intergovernmental 2,999,185 2,999,185 1,948,457 (1,050,728) ' Charges for services: General government charges $24,620 $24,620 $29,542 $4,922 Public safety charges 17,450 17,450 25,039 7,589 Public works 324,922 324,922 295,081 (29,841) ' Recreation fees 316,900 316,900 329,213 12,313 Total charges for services 683,892 683,892 678,875 (5,017) 84 ' CITY OF BROOKLYN CENTER,MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION Statement 9 BUDGETARY COMPARISON SCHEDULE-GENERAL FUND Page 2 of 6 For The Year Ended December 31,2003 ' Variance with Final Budget- Budgeted Amounts Actual Positive Original Final Amounts (Negative) Revenues:(continued) Fines and forfeits $200,000 $200,000 $290,408 $90,408 ' Miscellaneous: Investment earnings 300,000 300,000 135,023 (164,977) Change in fair value of investments - - (38,501) (38,501) Other 75,000 75,000 261,889 186,889 ' Total miscellaneous 375,000 375,000 358,411 (16,589) Total revenues 15,408,271 15,408,271 14,902,910 (505,361) Expenditures: General government: Mayor and council: ' Current: Personal services 48,338 48,338 46,723 1,615 Materials and supplies 1,500 1,500 219 1,281 Contractual services 84,465 84,465 74,996 9,469 ' Total mayor and council 134,303 134,303 121,938 12,365 Administrative office: Current: ' Personal services 438,259 438,259 427,483 10,776 Materials and supplies 7,000 7,000 572 6,428 Contractual services 67,995 67,995 46,358 21,637 ' Total administrative office 513,254 513,254 474,413 38,841 Elections and voter registration: Current: Personal services 76,321 76,321 54,512 21,809 ' Materials and supplies 1,000 1,000 3,949 (2,949) Contractual services 4,775 4,775 678 4,097 Total elections and voter registration 82,096 82,096 59,139 22,957 . Assessor's office: Current: Personal services 206,332 206,332 198,838 7,494 Materials and supplies 3,225 3,225 3,197 28 ' Contractual services 34,506 34,506 35,431 (925) Total current 244,063 244,063 237,466 6,597 Capital outlay 6,280 6,280 1,312 4,968 ' Total assessor's office 250,343 250,343 238,778 11,565 Finance: Current: ' Personal services 406,949 406,949 405,064 1,885 Materials and supplies 4,575 4,575 207 4,368 Contractual services 10,600 10,600 8,817 1,783 ' Total current 422,124 422,124 414,088 8,036 Capital outlay 3,000 3,000 3,000 Total finance 425,124 425,124 414,088 11,036 ' 85 CITY OF BROOKLYN CENTER,MINNESOTA , REQUIRED SUPPLEMENTARY INFORMATION Statement 9 BUDGETARY COMPARISON SCHEDULE-GENERAL FUND Page 3 of 6 For The Year Ended December 31,2003 Variance with ' Final Budget- Budgeted Amounts Actual Positive Original Final Amounts (Negative) ' Expenditures(continued): General government:(continued) Legal: Current: ' Personal services $250,000 $250,000 $263,725 ($13,725) Government buildings: Current: ' Personal services 240,212 240,212 239,029 1,183 Materials and supplies 57,125 57,125 37,356 19,769 Contractual services 253,007 253,007 304,098 (51,091) ' Total government buildings 550,344 550,344 580,483 (30,139) Data processing: Current: ' Personal services 148,790 148,790 151,954 (3,164) Materials and supplies 9,000 9,000 11,143 (2,143) Contractual services 175,925 175,925 158,003 17,922 Total current 333,715 333,715 321,100 12,615 , Capital outlay 27,200 27,200 23,944 3,256 Total data processing 360,915 360,915 345,044 15,871 Total general government 2,566,379 2,566,379 2,497,608 68,771 ' Public safety: Police protection: , Current: Personal services 4,423,943 4,423,943 4,167,212 256,731 Materials and supplies 101,845 101,845 82,283 19,562 ' Contractual services 912,327 912,327 843,234 69,093 Total current 5,438,115 5,438,115 5,092,729 345,386 Capital outlay 14,585 14,585 7,985 61600 Total police protection 5,452,700 5,452,700 5,100,714 351,986 Fire protection: Current: Personal services 407,190 407,190 416,338 (9,148) ' Materials and supplies 45,000 45,000 61,394 (16,394) Contractual services 211,154 211,154 224,846 (13,692) Total current 663,344 663,344 702,578 (39,234) Capital outlay 44,500 44,500 9,952 34,548 Total fire protection 707,844 707,844 712,530 (4,686) 86 CITY OF BROOKLYN CENTER,MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION Statement 9 BUDGETARY COMPARISON SCHEDULE-GENERAL FUND Page 4 of 6 For The Year Ended December 31,2003 Variance with Final Budget- Budgeted Amounts Actual Positive ' Original Final Amounts (Negative) Expenditures(continued): Public safety: (continued) Protective inspection: Current: Personal services $393,483 $393,483 $362,491 $30,992 Materials and supplies 4,100 4,100 733 3,367 ' Contractual services 25,502 25,502 43,402 (17,900) Total protective inspection 423,085 423,085 406,626 16,459 Emergency preparedness: ' Current: Personal services 48,891 48,891 45,202 3,689 Materials and supplies 2,400 2,400 1,003 1,397 ' Contractual services 10,415 10,415 6,800 3,615 Total emergency preparedness 61,706 61,706 53,005 8,701 Total public safety 6,645,335 6,645,335 6,272,875 372,460 ' Public works: Engineering department: ' Current: Personal services 508,625 508,625 384,764 123,861 Materials and supplies 4,500 4,500 9,333 (4,833) ' Contractual services 56,558 56,558 40,703 15,855 Total current 569,683 569,683 434,800 134,883 Capital outlay 6,000 6,000 - 6,000 Total engineering department 575,683 575,683 434,800 140,883 ' Street department: Current: Personal services 689,142 689,142 632,159 56,983 Materials and supplies 158,500 158,500 128,384 30,116 Contractual services 418,147 418,147 354,182 63,965 Total current 1,265,789 1 265 789 1,114,725 151 064 Capital outlay 94,000 94,000 99,880 (5,880) ' Total street department 1,359,789 1,359,789 1,214,605 145,184 Total public works 1,935,472 1,935,472 1,649,405 286,067 ' Community services: Social services: Current: Contractual services 93,105 93,105 91,581 1,524 ' 87 CITY OF BROOKLYN CENTER,MINNESOTA ' REQUIRED SUPPLEMENTARY INFORMATION Statement 9 BUDGETARY COMPARISON SCHEDULE-GENERAL FUND Page 5 of 6 For The Year Ended December 31,2003 Variance with ' Final Budget- Budgeted Amounts Actual Positive Original Final Amounts (Negative) ' Expenditures(continued): Parks and recreation: Administration: , Current: Personal services $430,888 $430,888 $421,918 $8,970 Materials and supplies 11,900 11,900 4,813 7,087 ' Contractual services 66,800 66,800 44,977 21,823 Total current 509,588 509,588 471,708 37,880 Capital outlay 3,200 3,200 2,699 501 Total administration 512,788 512,788 474,407 38,381 , Adult programs: Current: Personal services 104,803 104,803 61,254 43,549 ' Materials and supplies 17,800 17,800 13,075 4,725 Contractual services 46,700 46,700 78,777 (32,077) Total adult programs 169,303 169,303 153,106 16,197 Teen programs ' Current: Personal services 5,252 5,252 4,695 557 Materials and supplies 700 700 409 291 , Contractual services 1,200 1,200 - 1,200 Total teen programs 7,152 7,152 5,104 2,048 Youth programs: Current: ' Personal services 100,355 100,355 41,024 59,331 Materials and supplies 19,557 19,557 8,525 11,032 Contractual services 5,080 5,080 1,793 3,287 , Total youth programs 124,992 124,992 51,342 73,650 General programs: Current: ' Personal services 25,443 25,443 27,422 (1,979) Materials and supplies 100 100 - 100 Contractual services 38,700 38,700 16,699 22,001 , Total general programs 64,243 64,243 44,121 20,122 Community center: Current: Personal services 441,282 441,282 392,083 49,199 ' Materials and supplies 15,750 15,750 19,960 (4,210) Contractual services 82,350 82,350 61,648 20,702 Total current 539,382 539,382 473,691 65,691 Capital outlay 10,000 10,000 1,039 8,961 Total community center 549,382 549,382 474,730 74,652 88 ' CITY OF BROOKLYN CENTER,MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION Statement 9 BUDGETARY COMPARISON SCHEDULE-GENERAL FUND Page 6 of 6 For The Year Ended December 31,2003 ' Variance with Final Budget- Budgeted Amounts Actual Positive Original Final Amounts (Negative) Expenditures(continued): Parks and recreation:(continued) Park maintenance: Current: Personal services $625,743 $625,743 $550,376 $75,367 Materials and supplies 73,100 73,100 38,602 34,498 Contractual services 292,451 292,451 242,352 50,099 Total current 991,294 991,294 831,330 159,964 Capital outlay 37,450 37,450 33,894 3,556 Total park maintenance 1,028,744 1,028,744 865,224 163,520 Total parks and recreation 2,456,604 2,456,604 2,068,034 388,570 Economic development: Convention bureau: Current: ' Personal services 339,750 339,750 316,059 23,691 Nondepartmental: ' Expenditures not charged to departments: Current: Personal services 48,155 48,155 46,203 1,952 Materials and supplies 27,800 27,800 14,685 13,115 ' Contractual services 429,561 429,561 270,335 159,226 Total current 505,516 505,516 331,223 174,293 Capital outlay 1,700 1,700 1,385 315 ' Total nondepartmental 507,216 507,216 332,608 174,608 Total expenditures 14,543,861 14,543,861 13,228,170 1,315,691 ' Revenues over(under)expenditures 864,410 864,410 1,674,740 810,330 Other financing sources(uses): ' Transfers in-administrative services reimbursed 784,084 784,084 607,221 (176,863) Transfers to other funds (1,648,494) (1,648,494) (2,194,655) (546,161) Total other financing sources(uses) (864,410) (864,410) (1,587,434) (723,024) Net increase(decrease)in fund balance $0 $0 87,306 $87,306 Fund balance-January 1 7,929,774 ' Fund balance-December 31 $8,017,080 89 CITY OF BROOKLYN CENTER,MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION Statement 10 ' BUDGETARY COMPARISON SCHEDULE-EARLE BROWN TAX INCREMENT DISTRICT For the Year Ended December 31,2003 Variance with ' Final Budget- Budgeted Amounts Positive Original Final Actual (Negative) ' Revenues: Property taxes $931,861 $931,861 $833,553 ($98,308) Interest - - 4,503 4,503 Total revenue 931,861 931,861 838,056 (93,805) Expenditures: Services and other charges 10,000 10,000 55,969 (45,969) ' Revenues over(under)expenditures 921,861 921,861 782,087 (139,774) Other financing sources(uses): ' Transfers out (1,440,000) (1,440,000) (653,000) 787,000 Net increase(decrease)in fund balance ($518,139) ($518,139) 129,087 $647,226 Fund balance-January 1 (1,814,455) Fund balance-December 31 ($1,685,368) 90 ' CITY OF BROOKLYN CENTER,MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION Statement 11 BUDGETARY COMPARISON SCHEDULE-TAX INCREMENT DISTRICT NO.3 For the Year Ended December 31,2003 ' Variance with Final Budget- Budgeted Amounts Positive ' Original Final Actual (Negative) Revenues: Property taxes $2,314,908 $2,314,908 $2,308,605 ($6,303) ' Interest - - 81,399 81,399 Total revenues 2,314,908 2,314,908 2,390,004 75,096 Expenditures: Services and other charges 345,000 345,000 559,559 (214,559) Interest 53,000 53,000 20,000 33,000 Total expenditures 398,000 398,000 579,559 (181,559) ' Revenues over expenditures 1,916,908 1,916,908 1,810,445 (106,463) ' Other financing sources(uses): Transfers out (548,000) (548,000) (548,000) Net increase in fund balance $1,368,908 $1,368,908 1,262,445 ($106,463) Fund balance-January 1 4,856,845 ' Fund balance-December 31 $6,119,290 ' 91 1 CITY OF BROOKLYN CENTER,MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE NOTE TO RSI December 31,2003 Note A LEGAL COMPLIANCE—BUDGETS ' The General Fund budget is legally adopted on a basis consistent with accounting principals generally accepted in the United States of America. The legal level of budgetary control is at the department level for the General Fund. The following is a listing of General Fund departments whose expenditures exceed budget ' appropriations. Final Over , Budget Actual Budget Major Funds: General Fund: Legal 250,000 263,725 (13,725) ' Government buildings 550,344 580,483 (30,139) Fire protection 707,844 712,530 (4,686) Special Revenue Funds: , Earle Brown Tax Increment District 10,000 55,969 (45,969) Tax Increment District No.3 398,000 579,559 (181,559) ' 92 ' COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES 93 -This page intentionally left blank- 94 ' ' NONMAJOR GOVERNMENTAL FUNDS 95 -This page intentionally left blank- ' 96 ' SPECIAL REVENUE FUNDS ' A Special Revenue Fund is used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. DEBT SERVICE FUNDS ' The Debt Service Funds are used to account for the accumulation of resources for, and payment of, interest, principal and related costs on general long-term debt. CAPITAL PROJECT FUNDS ' The Capital Project Funds account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by ' Proprietary Funds). 97 -This page intentionally left blank- ' 98 ' CITY OF BROOKLYN CENTER,MINNESOTA COMBINING BALANCE SHEET Statement 12 NONMAJOR GOVERNMENTAL FUNDS December 31,2003 ' Total Nonmajor Special Debt Capital Governmental ' Assets: Revenue Service Project Funds Cash and investments $1,978,177 $2,420,103 $1,965,891 $6,364,171 Receivables: Accounts 473 - - 473 ' Delinquent taxes 10,623 30,789 - 41,412 Due from other funds - - 158,933 158,933 Due from other governments 52,336 - - 52,336 ' Advances to other funds - - 2,188,038 2,188,038 Total assets $2,041,609 $2,450,892 $4,312,862 $8,805,363 ' Liabilities and Fund Balance Liabilities: ' Accounts payable $168,504 $75,700 $61,991 $306,195 Due to other funds 158,933 158,933 Due to other governments 54,997 - - 54,997 Accrued salaries and wages 12,291 - - 12,291 ' Deferred revenue 28,720 30,789 - 59,509 Total liabilities 264,512 106,489 220,924 591,925 ' Fund balance: Reserved - 2,344,403 2,188,038 4,532,441 Unreserved: Designated - - 1,903,900 1,903,900 Undesignated 1,777,097 - - 1,777,097 Total fund balance 1,777,097 2,344,403 4,091,938 8,213,438 ' Total liabilities and fund balance $2,041,609 $2,450,892 $4,312,862 $8,805,363 99 CITY OF BROOKLYN CENTER,MINNESOTA ' COMBINING STATEMENT OF REVENUES,EXPENDITURES AND Statement 13 CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS , For The Year Ended December 31,2003 Total Nonmajor , Special Debt Capital Governmental Revenues: Revenue Service Project Funds Taxes and special assessments $454,858 $ - $ $454,858 ' Intergovernmental 760,295 292,761 145,387 1,198,443 Charges for services 6,194 - - 6,194 Investment earnings 23,914 18,314 46,615 88,843 Miscellaneous 219,385 - 126,308 345,693 ' Total revenues 1,464,646 311,075 318,310 2,094,031 Expenditures: ' Current: General government - - 2,971 2,971 Public safety 365,543 - - 365,543 ' Public works - - 236,723 236,723 Economic development 806,670 - - 806,670 Capital outlay: - General government - - 90,224 90,224 , Public works - - 491,289 491,289 Debt service: Principal retirement - 2,350,000 - 2,350,000 , Interest - 662,769 - 662,769 Paying agent fees - 11,272 - 11,272 Total expenditures 1,172,213 3,024,041 821,207 5,017,461 ' Revenues over(under)expenditures 292,433 (2,712,966) (502,897) (2,923,430) Other financing sources(uses): ' Sale of land 73,175 - - 73,175 Transfers in 207,854 1,972,937 783,639 2,964,430 Transfers out (207,854) - - (207,854) ' Total other financing sources(uses) 73,175 1,972,937 783,639 2,829,751 Net increase(decrease)in fund balance 365,608 (740,029) 280,742 (93,679) ' Fund balance-January 1 1,411,489 3,084,432 3,811,196 8,307,117 Fund balance-December 31 $1,777,097 $2,344,403 $4,091,938 $8,213,438 ' - 100 , NONMAJOR SPECIAL REVENUE FUNDS ' The City of Brooklyn Center had the following Special Revenue Funds during the year: Housing and Redevelopment Authority Fund (HRA) -This fund has authority to levy an ad valorem property tax for the purpose of conducting housing and redevelopment projects. These projects are accounted for in the EDA Fund; all tax proceeds are transferred to that fund. ' Economic Development Authority Fund (EDA) -This fund was established to account for the Economic Development Authority (EDA) of Brooklyn Center. The EDA carries out ' development activities; it has authority to operate an enterprise. The Earle Brown Heritage Center operates under this authority and a statement of its operations can be found in the enterprise fund section of this report. The EDA also does redevelopment and housing projects, funded by an ad valorem property tax levy and transfers from the CDBG and HRA funds. Tax Increment District N . 4 F r o and—This fund has the authority to collect tax increments which are used for various redevelopment projects within the City and for debt service payments of bonds which were issued for the same purpose. Police Drug Forfeiture Fund -This fund was established to account for property and/or cash ' seized by Police Department personnel. Community Development Block Grant Fund (CDBG) -This fund was established to account ' for funds received under Title I of the Housing and Community Development Act of 1974. Transfers are made from this fund to the Economic Development Authority Fund; projects are accounted for in the Economic Development Authority Fund. ' City Initiatives Grant Fund—Revenues and expenditures from grants received from outside entities are accounted for in this fund. Grant programs for 2003 include several public safety ' grants, an after school enrichment recreation grant and a local planning assistance grant. I ' 101 -This page intentionally left blank- , 102 ' CITY OF BROOKLYN CENTER SUBCOMBINING BALANCE SHEET Statement 14 NONMAJOR SPECIAL REVENUE FUNDS ' December 31,2003 ' Total Economic Tax Police City Nonmajor Development Increment Drug Initiatives Special ' Authority District Forfeiture Grant Revenue Fund No.4 Fund Fund Funds Assets Cash and investments $1,572,557 $108,087 $74,447 $223,086 $1,978,177 Accounts receivable - - 473 - 473 ' Delinquent taxes receivable 10,623 - - - 10,623 Due from other governments 26,000 26,336 52,336 Total assets $1,609,180 $108,087 $74,920 $249,422 $2,041,609 Liabilities and Fund Balance Liabilities: Accounts payable $50,650 $1,322 $752 $115,780 $168,504 Due to other governments 54,997 - - - 54,997 Accrued salaries payable 5,602 - - 6,689 12,291 ' Deferred revenue 9,165 - - 19,555 28,720 Total liabilities 120,414 1,322 752 142,024 264,512 ' Fund balance: Unreserved 1,488,766 106,765 74,168 107,398 1,777,097 tTotal liabilities and fund balance $1,609,180 $108,087 $74,920 $249,422 $2,041,609 t ' 103 CITY OF BROOKLYN CENTER , SUBCOMBINING STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR SPECIAL REVENUE FUNDS For The Year Ended December 31,2003 ' Housing ' and Economic Redevelopment Development Authority Authority ' Fund Fund Revenues: Property taxes $207,854 $36 Intergovernmental - 188,495 Charges for services - - Investment earnings - 20,276 Miscellaneous - 89,002 ' Total revenues 207,854 297,809 Expenditures: ' Personal services - 124,580 Supplies - 2,962 Services and other charges - 235,876 Total expenditures 0 363,418 ' Revenues over(under)expenditures 207,854 (65,609) Other financing sources(uses): , Sale of land - 73,175 Transfers in - 207,854 , Transfers out (207,854) - Total other financing sources(uses) (207,854) 281,029 Net increase in fund balance 0 215,420 , Fund balance-January 1 - 1,273,346 Fund balance-December 31 $0 $1,488,766 ' 104 ' ' Statement 15 ' Total Tax Police Community City Nonmajor Increment Drug Development Initiatives Special District Forfeiture Block Grant Revenue No.4 Fund Grant Fund Funds $246,968 $ - $ - $ - $454,858 ' - - 201,000 370,800 760,295 - 6,194 6,194 1,106 - 2,532 23,914 ' - 27,571 - 102,812 219,385 246,968 28,677 201,000 482,338 1,464,646 ' 3,118 - - 52,347 180,045 - 2,009 - 212,808 217,779 ' 202,307 11,370 201,000 123,836 774,389 205,425 13,379 201,000 388,991 1,172,213 41,543 15,298 0 93,347 292,433 - - - 73,175 - = 207,854 (207,854) 0 0 0 0 73,175 ' 41,543 15,298 0 93,347 365,608 65,222 58,870 - 14,051 1,411,489 ' $106,765 $74,168 $0 $107,398 $1,777,097 I ' 105 -This page intentionally left blank- 106 1 1 1 NONMAJOR DEBT SERVICE FUNDS 1 The City's Debt Service Funds account for two types of bonded indebtedness: 1 • General Obligation Bonds • Tax Increment Bonds 1 General Obligation Bonds Fund—This fund is used to account for the accumulation of resources for payment of general obligation bonds and interest thereon. 1 Tax Increment Bonds Fund—This fund is used to account for the accumulation of resources for payment of tax increment general obligation bonds and interest ' thereon. These bonds were sold to finance the purchase and redevelopment of the historic Earle Brown Farm and other various redevelopment projects within the City. 1 ■ 1 1 1 i 1 � 1 � 1 ' I07 CITY OF BROOKLYN CENTER,MINNESOTA 1 SUBCOMBINING BALANCE SHEET Statement 16 NONMAJOR DEBT SERVICE FUNDS December 31,2003 Total 1 Nonmajor General Tax Debt Obligation Increment Service 1 Bonds Bonds Funds Assets Cash and investments $958,509 $1,461,594 $2,420,103 , Delinquent taxes receivable 30,789 - 30,789 Total assets $989,298 $1,461,594 $2,450,892 , Liabilities and Fund Balance Liabilities: , Accounts payable $50,800 24,900 $75,700 Deferred revenue 30,789 - 30,789 Total liabilities 81,589 24,900 106,489 ' Fund balance: Reserved: Reserved for debt service 907,709 1,436,694 2,344,403 Total liabilities and fund balance $989,298 $1,461,594 $2,450,892 1 1 1 1 i 1 1 108 1 ' CITY OF BROOKLYN CENTER,MINNESOTA SUBCOMBINING STATEMENT OF REVENUES, EXPENDITURES AND Statement 17 CHANGES IN FUND BALANCE ' NONMAJOR DEBT SERVICE FUNDS For The Year Ended December 31,2003 Total Nonmajor General Tax Debt Obligation Increment Service Bonds Bonds Funds Revenues: ' Intergovernmental $292,761 $ - $292,761 Investment earnings 7,954 10,360 18,314 Total revenues 300,715 10,360 311,075 Expenditures: Principal 705,000 1,645,000 2,350,000 Interest 322,356 340,413 662,769 ' Fiscal agent fees 9,557 1,715 11,272 Total expenditures 1,036,913 1,987,128 3,024,041 ' Revenues over(under)expenditures (736,198) (1,976,768) (2,712,966) Other financing sources(uses): Transfers in 771,937 1,201,000 1,972,937 tNet increase(decrease)in fund balance 35,739 (775,768) (740,029) ' Fund balance-January 1 871,970 2,212,462 3,084,432 Fund balance-December 31 $907,709 $1,436,694 $2,344,403 t t109 This page intentionally left blank- t 110 ' 1 NONMAJOR CAPITAL PROJECT FUNDS The City of Brooklyn Center had the following Capital Project Funds during the year: ' Capital Reserve Emergency Fund -This fund was established in 1997 to account for monies held in reserve for catastrophic losses or unforeseen capital items. Capital Improvements Fund -This fund was established in 1968 to provide funds, and to account for the expenditure of such funds, for major capital outlays including, but not limited to, construction or acquisition of major permanent facilities having a relatively long life; and/or to reduce debt incurred for capital outlays. The financing sources of the fund include ad valorem taxation, transfers from other funds, issuance of bonds, federal and state grants, and investment earnings. Municipal State Aid for Construction Fund -This fund was established to account t for the state allotment of gasoline tax collections used for transportation related construction projects. ' Earl Brown Heritage Center Improvements Fund -This fund was established to provide a stable source of funds to pay for periodic capital improvements needed at the facility. ' Street Reconstruction Fund—Formerl y the Special Assessment Construction Fund, this fund accounts for the resources collected and expended in order to reconstruct roadways and appurtenances financed wholly or in part by special assessments. ' Technology Fund -This fund, established in 2003, accounts for funds set aside for technology improvements or major technology renovations/replacements. CITY OF BROOKLYN CENTER,MINNESOTA ' SUBCOMBINING BALANCE SHEET NONMAJOR CAPITAL PROJECT FUNDS December 31,2003 ' Capital Reserve Capital Emergency Improvements Assets Fund Fund Cash and investments $492,027 $906,810 Due from other funds 158,933 - Advance to other funds 709,969 885,000 Total assets $1,360,929 $1,791,810 Liabilities and Fund Balance ' Liabilities: Accounts payable $24,356 $34,080 ' Due to other funds - Total liabilities 24,356 34,080 Fund balance: ' Reserved: Advances to other funds 709,969 885,000 Unreserved: Undesignated 626,604 872,730 Total fund balance 1,336,573 1,757,730 Total liabilities and fund balance $1,360,929 $1,791,810 112 ' ' Statement 18 Municipal Earle Brown Total State Aid Heritage Nonmajor ' for Center Street Capital Construction Improvements Reconstruction Technology Projects Fund Fund Fund Fund Funds t $ - $8,163 $283,891 $275,000 $1,965,891 - - - - 158,933 593,069 - - 2,188,038 $593,069 $8,163 $283,891 $275,000 $4,312,862 ' $3,555 $ - - - $61,991 158,933 158,933 162,488 0 0 0 220,924 593,069 - - - 2,188,038 ' (162,488) 8,163 283,891 275,000 1,903,900 430,581 8,163 283,891 275,000 4,091,938 $593,069 $8,163 $283,891 $275,000 $4,312,862 1 ' 113 CITY OF BROOKLYN CENTER,MINNESOTA , SUBCOMBINING STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR CAPITAL PROJECT FUNDS ' For The Year Ended December 31,2003 Capital Reserve Capital Emergency Improvements Fund Fund Revenues: Intergovernmental $ - $ Investment earnings 31,439 13,494 Miscellaneous - 126,308 Total revenues 31,439 139,802 Expenditures: Personal services - 748 , Supplies - 146 Services and other charges 24,356 206,369 Capital outlay - 160,784 Total expenditures 24,356 368,047 , Revenue over(under)expenditures 7,083 (228,245) Other financing sources(uses): Transfers in - 225,000 Net increase(decrease)in fund balance 7,083 (3,245) Fund balance-January 1 1,329,490 1,760,975 Fund balance-December 31 $1,336,573 $1,757,730 114 ' tStatement 19 Municipal Earle Brown Total State Aid Heritage Nonmajor ' for Center Street Capital Construction Improvements Reconstruction Technology Projects Fund Fund Fund Fund Funds i $145,387 $ - $ - $ - $145,387 72 1,358 252 - 46,615 - - - - 126,308 145,459 1,358 252 0 318,310 - - - - 14 146 6 5,104 2,971 - - 238,800 330,505 90,224 - - 581,513 335,609 93,195 0 0 821,207 (190,150) (91,837) 252 0 (502,897) 283,639 275,000 783,639 (190,150) (91,837) 283,891 275,000 280,742 620,731 100,000 - - 3,811,196 $430,581 $8,163 $283,891 $275,000 $4,091,938 1 ' 115 CITY OF BROOKLYN CENTER,MINNESOTA SPECIAL REVENUE FUND-HOUSING AND REDEVELOPMENT AUTHORITY FUND Statement 20 SCHEDULE OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE-BUDGET AND ACTUAL ' For The Year Ended December 31,2003 Budgeted Amounts Actual ' Original Final Amounts Revenues: , Property taxes $207,155 $207,155 $207,854 Expenditures - - - Revenues over expenditures 207,155 207,155 207,854 Other financing sources(uses): Transfers out (207,155) (207,155) (207,854) Net increase in fund balance $0 $0 - Fund balance-January 1 - Fund balance-December 31 $0 116 ' ' CITY OF BROOKLYN CENTER,MINNESOTA SPECIAL REVENUE FUND-ECONOMIC DEVELOPMENT AUTHORITY FUND Statement 21 SCHEDULE OF REVENUES,EXPENDITURES AND ' CHANGES IN FUND BALANCE-BUDGET AND ACTUAL For The Year Ended December 31,2003 Budgeted Amounts Actual ' Original Final Amounts Revenues: Property taxes $ $ $36 Intergovernmental - - 188,495 ' Investment earnings 26,250 26-250 20,276 Miscellaneous 89,002 Total revenues 26,250 26,250 297,809 ' Expenditures: Current: Personal services 199,040 199,040 124,580 Supplies 1,750 1,750 2,962 Services and other charges 89,551 89,551 235,096 Debt service: Interest - - 780 Total expenditures 290,341 290,341 363,418 Revenues over(under)expenditures (264,091) (264,091) (65,609) Other financing sources(uses): Sale of land - - 73,175 Transfers in 207,155 207,155 207,854 ' Total other financing sources(uses) 207,155 207,155 281,029 Net increase(decrease)in fund balance ($56,936) ($56,936) 215,420 Fund balance January 1 1,273,346 ' Fund balance-December 31 $1,488,766 117 CITY OF BROOKLYN CENTER,MINNESOTA ' SPECIAL REVENUE FUND-TAX INCREMENT DISTRICT NO.4 FUND Statement 22 SCHEDULE OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE-BUDGET AND ACTUAL For The Year Ended December 31,2003 Budgeted Amounts Actual ' Original Final Amounts Revenues: ' Property taxes $355,655 $355,655 $246,968 Expenditures: ' Current: Personal services - - 3,118 Services and other charges - - 13,776 Debt service: ' Principal 236,500 236,500 188,489 Interest - - 42 Total expenditures 236,500 236,500 205,425 Revenues over expenditures $119,155 $119,155 41,543 Fund balance-January 1 65,222 ' Fund balance-December 31 $106,765 118 ' ' CITY OF BROOKLYN CENTER,MINNESOTA SPECIAL REVENUE FUND-POLICE DRUG FORFEITURE FUND Statement 23 SCHEDULE OF REVENUES,EXPENDITURES AND ' CHANGES IN FUND BALANCE-BUDGET AND ACTUAL For The Year Ended December 31,2003 Budgeted Amounts Actual Original Final Amounts ' Revenues: Forfeited drug money $20,000 $20,000 $27,571 Investment earnings - - 1,106 ' Total revenues 20,000 20,000 28,677 Expenditures: Current: ' Supplies 8,000 8,000 2,009 Services and other charges 2,000 2,000 11,370 Capital outlay 10,000 10,000 - ' Total expenditures 20,000 20,000 13,379 Revenues over expenditures $0 $0 15,298 ' Fund balance-January 1 58,870 Fund balance-December 31 $74,168 119 CITY OF BROOKLYN CENTER,MINNESOTA ' SPECIAL REVENUE FUND-COMMUNITY DEVELOPMENT BLOCK GRANT FUND Statement 24 SCHEDULE OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE-BUDGET AND ACTUAL ' For The Year Ended December 31,2003 Budgeted Amounts Actual Original Final Amounts Revenues: ' Intergovernmental: Federal grants $250,000 $250,000 $201,000 Expenditures: , Current: Services and other charges 234,516 234,516 201,000 ' Revenues over expenditures $15,484 $15,484 0 Fund balance-January 1 - ' Fund balance-December 31 $0 120 ' I CITY OF BROOKLYN CENTER,MINNESOTA SPECIAL REVENUE FUND-CITY INITIATIVES GRANT FUND Statement 25 SCHEDULE OF REVENUES,EXPENDITURES AND ' CHANGES IN FUND BALANCE-BUDGET AND ACTUAL For The Year Ended December 31,2003 ' Budgeted Amounts Actual Original Final Amounts Revenues: Intergovernmental $ - $ - $370,800 Charges for services - - 6,194 ' Investment earnings - - 2,532 Miscellaneous 50,000 50,000 102,812 Total revenues 50,000 50,000 482,338 ' Expenditures: Current: Personal services 8,000 8,000 52,347 Supplies - - 212,808 Services and other charges 40,000 40,000 123,836 Total expenditures 48,000 48,000 388,991 Net increase(decrease)in fund balance $2,000 $2,000 93,347 Fund balance-January 1 14,051 Fund balance-December 31 $107,398 I 121 -This page intentionally left blank- , 122 , NONMAJOR ENTERPRISE FUNDS ' The City of Brooklyn Center had the following nonmajor Enterprise Funds during the year: Recycling and Refuse Fund -This fund accounts for the operation of a state- mandated recycling program. Expansion into refuse collection will take place only when there is a clear advantage to be achieved by it. Street Light Utility Fund-This fund was created to account for expenses related ' to streetlights within the City. Benefiting properties are billed for these expenses. i 123 CITY OF BROOKLYN CENTER,MINNESOTA ' SUBCOMBINING STATEMENT OF NET ASSETS Statement 26 NONMAJOR ENTERPRISE FUNDS December 31,2003 ' Total , Nonmajor Recycling and Street Light Enterprise ' Refuse Fund Utility Fund Funds Assets: Cash and cash equivalents $47,320 $79,343 $126,663 ' Accounts receivable-net 47,531 44,158 91,689 Total assets 94,851 123,501 218,352 Liabilities: Accounts payable 914 157 1,071 Net assets: ' Unreserved 93,937 123,344 217,281 Total net assets $93,937 $123,344 $217,281 124 ' r r CITY OF BROOKLYN CENTER,MINNESOTA SUBCOMBINING STATEMENT OF REVENUES,EXPENSES, Statement 27 AND CHANGES IN FUND NET ASSETS NONMAJOR ENTERPRISE FUNDS For The Year Ended December 31,2003 ' Total Nonmajor Recycling and Street Light Enterprise Refuse Fund Utility Fund Funds Operating revenues: Sales and user fees $212,271 $200,224 $412,495 Operating expenses: Supplies 137 824 961 ' Other services 223,367 12,286 235,653 Insurance 175 789 964 Utilities - 133,394 133,394 Total operating expenses 223,679 147,293 370,972 rOperating income(loss) (11,408) 52,931 41,523 ' Nonoperating revenues(expenses): Investment earnings 1,552 1,448 3,000 Change in fair value of investments (443) (413) (856) Other revenue 4,367 8,060 12,427 rTotal nonoperating revenues(expenses) 5,476 9,095 14,571 Change in net assets (5,932) 62,026 56,094 Net assets-January 1 99,869 61,318 161,187 Net assets-December 31 $93,937 $123,344 $217,281 � 1 1 11 1 1 1 r125 CITY OF BROOKLYN CENTER,MINNESOTA SUBCOMBINING STATEMENT OF CASH FLOWS Statement 28 ' NONMAJOR ENTERPRISE FUNDS For The Year Ended December 31,2003 Total ' Nonmajor Recycling and Street Light Enterprise ' Refuse Fund Utility Fund Funds Cash flows from operating activities: Receipts from customers $211,205 $198,433 $409,638 , Payments to suppliers (223,862) (158,546) (382,408) Miscellaneous revenue 3,924 7,647 11,571 Net cash flows from operating activities (8,733) 47,534 38,801 Cash flows from investing activities: Interest on investments 1,552 1,448 3,000 Net increase in cash and cash equivalents (7,181) 48,982 41,801 , Cash and cash equivalents-January 1 54,501 30,361 84,862 ' Cash and cash equivalents-December 31 $47,320 $79,343 $126,663 Noncash items: , Change in fair value of investments ($443) ($413) ($856) Capital contribution $ Reconciliation of operating income to net cash provided(used) by operating activities: ' Operating income(loss) ($2,928) $57,092 $54,164 Adjustments to reconcile operating income(loss)to net cash provided by(used for)operating activities: Changes in assets and liabilities: , Decrease(increase)in receivables (1,066) (1,791) (2,857) Increase(decrease)in payables (183) (11,253) (11,436) Other nonoperating income 3,924 7,647 11,571 ' Net cash flows from operating activities ($253) $51,695 $51,442 I 126 ' 1 r 1 INTERNAL SERVICE FUNDS Internal Service Funds are used to account, on a cost reimbursement basis, for the financing of goods or services provided by one department to other departments ' of the City. Revenues and expenses in these funds are recognized on the accrual basis of ' accounting. Revenues are recognized in the accounting period in which they are earned and become measurable. Expenditures are recognized in the accounting period in which they are incurred. The City's Internal Service Funds included in this section are: ' Public Employees Compensated Absences Fund -This fund accounts for payment of unused vacation and sick leave time and the allocation of such costs to user departments. ' Public Employees Retirement Fund-This fund accounts for certain health care insurance benefits for City employees who retire before age 65. Substantially all ' of the City's full-time police and fire employees and all other full-time employees hired before July 1, 1989 may be eligible for those benefits from the time they quality for an unreduced PERA pension until they reach age 65 or become ' eligible for Medicare. In the event that future costs would exceed earnings, other funds would be charged for the costs associated with their employees. Central Garage Fund -This fund was established to account for the acquisition and maintenance of all City vehicles and rolling stock equipment. Vehicle and equipment maintenance, repair, and replacement will be provided from rental rates which the Central Garage charges City operating departments for use of the ' equipment. i 1 r r r ' 127 i CITY OF BROOKLYN CENTER,MINNESOTA ' SUBCOMBINING STATEMENT OF NET ASSETS Statement 29 INTERNAL SERVICE FUNDS December 31,2003 701 703 704 ' Central EE Retirement EE Comp Garage Benefit Absences Total Assets: Current assets: ' Cash and cash equivalents $4,541,395 $1,564,375 $795,418 $6,901,188 Accounts receivable-net 3,495 - - 3,495 Inventories-at cost 14,852 - - 14,852 Total current assets 4,559,742 1,564,375 795,418 6,919,535 ' Noncurrent assets: Capital assets: Machinery and equipment 5,816,573 - - 5,816,573 ' Less: Allowance for depreciation (3,578,243) - - (3,578,243) Net capital assets 2,238,330 0 0 2,238,330 Total noncurrent assets 2,238,330 0 0 2,238,330 Total assets 6,798,072 1,564,375 795,418 9,157,865 ' Liabilities: Current liabilities: Accounts payable 11,816 - - 11,816 Accrued salaries payable 10,519 - - 10,519 ' Total current liabilities 22,335 0 0 22,335 Noncurrent liabilities: Compensated absences payable - - 783,227 783,227 Accrued health insurance liability - 1,547,235 - 1,547,235 , Total noncurrent liabilities 0 1,547,235 783,227 2,330,462 Total liabilities 22,335 1,547,235 783,227 2,352,797 Net assets: ' Invested in capital assets,net of related debt 2,238,330 - - 2,238,330 Unrestricted 4,537,407 17,140 12,191 4,566,738 ' Total net assets $6,775,737 $17,140 $12,191 $6,805,068 128 ' ' CITY OF BROOKLYN CENTER,MINNESOTA SUBCOMBINING STATEMENT OF REVENUES,EXPENSES AND Statement 30 CHANGES IN FUND NET ASSETS ' INTERNAL SERVICE FUNDS For The Year Ended December 31,2003 701 703 704 Central EE Retirement EE Comp ' Garage Benefit Absences Total Operating revenues: Charges for services $1,017,718 $ - $ - $1,017,718 Operating expenses: Personal services 266,778 38,615 26,124 331,517 Supplies 193,490 - - 193,490 Other services 145,418 - - 145,418 Insurance 42,561 42,561 Utilities 2,713 - - 2,713 ' Depreciation 596,702 - - 596,702 Total operating expenses 1,247,662 38,615 26,124 1,312,401 Operating income(loss) (229,944) (38,615) (26,124) (294,683) ' Nonoperating revenues(expenses): Investment earnings 70,852 25,537 12,191 108,580 ' Gain(loss)on sale of fixed asset 35,801 - - 35,801 Other revenue 1,522 1,522 Total nonoperating revenues(expenses) 108,175 25,537 12,191 145,903 Change in net assets (121,769) (13,078) (13,933) (148,780) Net assets-January 1 6,897,506 30,218 26,124 6,953,848 ' Net assets-December 31 $6,775,737 $17,140 $12,191 $6,805,068 ' 129 CITY OF BROOKLYN CENTER MINNESOTA SUBCOMBINING STATEMENT OF CASH FLOWS Statement 31 ' INTERNAL SERVICE FUNDS For The Year Ended December 31,2003 701 703 704 - Central EE Retirement EE Comp Garage Benefit Absences Total Cash flows from operating activities: Receipts from interfund services provided $1,017,506 $5,935 $ - $1,023,441 Payments to suppliers (388,712) (39,317) - (428,029) ' Payments to employees (263,978) (2,446) 42,189 (224,235) Miscellaneous revenue 9,062 (10,186) (4,863) (5,987) Net cash flows from operating activities 373,878 (46,014) 37,326 365,190 ' Cash flows from capital and related financing activities: Acquisition and construction of capital assets (130,082) - - (130,082) Cash flows from investing activities: Interest on investments 99,113 35,723 17,054 151,890 Net increase in cash and cash equivalents 342,909 (10,291) 54,380 386,998 Cash and cash equivalents-January 1 4,198,486 1,574,666 741,038 6,514,190 Cash and cash equivalents-December 31 $4,541,395 $1,564,375 $795,418 $6,901,188 , Reconciliation of operating income to net cash , provided(used)by operating activities: Operating income(loss) ($229,944) ($38,615) ($26,124) ($294,683) Adjustments to reconcile operating income(loss) ' to net cash flows from operating activities: Depreciation 596,702 - - 596,702 Changes in assets and liabilities: Decrease(increase)in receivables (212) 5,935 - 5,723 ' Decrease(increase)in inventories 609 - - 609 Increase(decrease)in payables (5,139) (3,148) 68,313 60,026 Increase(decrease)in accrued expenses 2,800 - - 2,800 Other nonoperating income 9,062 (10,186) (4,863) (5,987) Total adjustments 603,822 (7,399) 63,450 659,873 Net cash provided by operating activities $373,878 ($46,014) $37,326 $365,190 , 130 1 r r CAPITAL ASSETS USED IN THE rOPERATION OF GOVERNMENTAL FUNDS 1 1 1 1 Ir � r r r � r r r r � r r ' 131 CITY OF BROOKLYN CENTER,MINNESOTA ' SCHEDULE OF CAPITAL ASSETS USED IN THE OPERATION Statement 32 OF GOVERNMENTAL FUNDS SCHEDULE BY SOURCE For The Year Ended December 31,2003 Balance Balance Restated January 1, Balance January 1, for 2003 December 31, Description 2003 infrastructure as restated Additions Deletions 2003 Land $3,298,904 $ - $3,298,904 $ - $95,000 $3,203,904 ' Construction in progress - 1,150,406 1,150,406 927,629 1,150,406 927,629 Buildings and improvements 18,525,070 - 18,525,070 168,828 - 18,693,898 ' Park improvements 2,906,141 - 2,906,141 3,320 - 2,909,461 Departmental equipment 345,746 - 345,746 49,693 - 395,439 ' Streets - 16,845,621 16,845,621 1,871,377 - 18,716,998 ' Totals $25,075,861 $17,996,027 $43,071,888 $3,020,847 $1,245,406 $44,847,329 Investments in General Fixed Assets from: , General indebtedness $10,211,111 General Fund 7,938,826 Liquor store income 143,012 Capital Project Funds 26,538,580 Federal grants 15,800 ' Total investments in general fixed assets $44,847,329 132 ' CITY OF BROOKLYN CENTER,MINNESOTA CAPITAL ASSETS USED IN THE OPERATION Statement 33 OF GOVERNMENTAL FUNDS SCHEDULE BY FUNCTION AND ACTIVITY December 31,2003 Buildings Construction and Furniture and ' Function and Activity Land In Progress Improvements Improvements Equipment Streets Total General government $1,190,478 $ $2,773,555 $ $38,285 $ $4,002,318 ' Public safety 311,923 9,336,930 258,456 - 9,907,309 Public works 80,124 2,120,396 29,067 18,716,998 20,946,585 Parks and recreation 1,621,379 - 4,463,017 2,909,461 69,631 - 9,063,488 ' Construction in progress - 927,629 - - - 927,629 Totals $3,203,904 $927,629 $18,693,898 $2,909,461 $395,439 $18,716,998 $44,847,329 1 r t ' 133 CITY OF BROOKLYN CENTER,MINNESOTA CAPITAL ASSETS USED IN THE OPERATION Statement 34 OF GOVERNMENTAL FUNDS SCHEDULE OF CHANGES BY FUNCTION AND ACTIVITY For The Year Ended December 31,2003 Balance Balance , January 1, December 31, Function and Activity 2003 Additions Deletions Adjustments 2003 General government $3,928,490 $168,828 $95,000 $ - $4,002,318 ' Public safety 9,891,509 15,800 - - 9,907,309 Public works 2,229,587 2,799,006 1,150,406 17,996,027 21,874,214 ' Parks and recreation 9,026,274 37,214 - - 9,063,488 Totals $25,075,860 $3,020,848 $1,245,406 $17,996,027 $44,847,329 134 ' 1 III. STATISTICAL SECTION (UNAUDITED) I135 CITY OF BROOKLYN CENTER,MINNESOTA GOVERNMENT-WIDE EXPENSES BY FUNCTION 2003 (Unaudited) Fiscal General Public Public Community Parks and Economic Non- Year* Government Safety Works Services Recreation Development Departmental 2003 $2,565,088 $7,184,536 $3,002,223 $225,365 $2,169,482 $1,759,585 $342,142 *Government-wide expenses are not available for years prior to 2003 ' t 136 Table 1 Interest on E.Brown Other Long-Term Municipal Golf Heritage Water Sanitary Storm Enterprise Debt Liquor Course Center Utility Sewer Drainage Funds Total $922,253 $724,897 $290,990 $2,109,166 $1,645,955 $2,567,032 $838,421 $370,972 $26,718,107 t I i 137 CITY OF BROOKLYN CENTER,MINNESOTA GOVERNMENT-WIDE REVENUES 2003 (Unaudited) ' 1 Program Revenues Charges Operating Capital Fiscal For Grants and Grants and Property Year* Services Contributions Contributions Taxes 2003 $10,802,128 $1,627,020 $1,079,134 $10,407,613 *Government-wide expenses are not available for years prior to 2003 l 138 Table 2 Genera(Revenues Grants and Contributions Not Restricted Unrestricted Gain on Tax Lodging to Specific Investment Sale of Increments Taxes Programs Earnings Fixed Assets Other Total $3,527,881 $661,267 $1,413,913 $508,494 $13,976 $829,572 $30,870,998 i t l S 139 CITY OF BROOKLYN CENTER,MINNESOTA GENERAL GOVERNMENTAL EXPENDITURES BY FUNCTION Table 3 Last Ten Fiscal Years (Unaudited) Admin. Other Fiscal General Public Public Community Parks and Economic Non- Services Financial Year Government Safety Works Services Recreation Development Departmental Reimb. Uses Total 1994 $1,925,003 $4,409,490 $1,526,514 $41,495 $2,055,479 $199,982 $312,779 ($528,684) $ $9,942,058 1995 2,069,978 4,598,618 1,653,358 41,146 2,226,121 209,576 289,747 (529,047) 10,559,497 1996 1,968,780 5,022,324 1,649,526 78,442 2,282,054 201,600 317,148 (611,534) 10,908,340 1997 1,992,251 5,089,072 1,868,130 79,800 2,186,686 248,779 311,436 (661,058) 624,637 11,739,733 1998 2,133,829 5,137,108 1,955,108 73,066 2,075,180 313,792 312,625 (731,737) 1,427,001 12,695,972 1999 2,257,957 5,336,622 1,904,205 83,295 2,132,511 383,927 343,925 (670,390) 1,591,039 13,363,091 2000 2,421,762 5,437,360 2,100,865 95,148 2,216,098 397,507 419,789 (795,737) 1,532,238 13,825,030 2001 2,504,392 5,660,600 2,142,064 106,034 2,205,018 392,805 372,056 (767,504) 1,661,877 14,277,342 2002 2,553,426 6,184,663 1,986,692 103,491 2,026,409 340,659 366,282 (596,541) 1,863,910 14,828,991 2003 2,497,608 6,272,875 1,649,405 91,581 2,068,034 316,059 332,608 (607,221) 2,194,655 14,815,604 (a) Table includes General Fund only. Source: City Finance Department records 140 r CITY OF BROOKLYN CENTER,MINNESOTA GENERAL GOVERNMENTAL REVENUES AND OTHER FINANCING SOURCES BY SOURCE Table 4 Last Ten Fiscal Years (Unaudited) r Other Fiscal Licenses Inter- Charges for Court Financing Year Taxes and Permits governmental Services Fines Miscellaneous Sources Total 1994 $5,703,773 $317,620 $3,443,247 $825,959 $113,573 $241,570 $100,000 $10,745,742 1995 5,946,363 318,202 3,543,009 822,530 178,263 271,509 100,000 11,179,876 1996 6,120,877 402,000 3,618,075 839,583 186,761 328,750 100,000 11,596,046 r1997 6,327,890 485,232 3,811,900 757,640 183,270 458,831 100,000 12,124,763 1998 7,949,744 549,067 3,875,392 771,614 193,688 425,319 - 13,764,824 1999 8,219,491 763,960 3,911,480 739,054 205,460 194,353 - 14,033,798 2000 8,745,172 632,549 4,076,169 779,060 180,676 234,740 - 14,648,366 2001 8,411,513 788,629 4,135,282 688,453 230,408 697,886 - 14,952,171 2002 11,257,003 823,996 2,843,629 575,748 278,557 312,303 - 16,091,236 2003 10,799,074 827,685 1,948,457 678,875 290,408 358,411 - 14,902,910 ' State aids were reduced for cities in 2002. Cities were permuted to levy back the aid reductions within specific limitations. Note: Table includes General Fund only. Source: City Finance Department records. r r r r r r 141 CITY OF BROOKLYN CENTER,MINNESOTA SPECIAL ASSESSMENT BILLINGS AND COLLECTIONS Table 5 Last Ten Fiscal Years (Unaudited) Percent . Current Collections Total Special Percent Collection Collections Fiscal Assessment of of Prior Total to Current Year Billings Amount Billings Years Collections Levy 1994 $466,784 $444,670 95.26% $7,592 $452,262 96.89% 1995 476,852 458,439 96.14% 5,497 463,936 97.29% 1996 485,019 459,316 94.70% 4,617 463,933 95.65% 1997 498,022 475,080 95.39% 2,470 477,550 95.89% 1998 541,477 524,609 96.88% 24,870 549,479 101.48% 1999 688,691 657,537 95.48% 34,532 692,069 100.49% 2000 900,481 861,888 95.71% 20,620 882,508 98.00% 2001 868,414 787,769 90.71% 20,620 808,389 93.09% 2002 927,799 863,460 93.07% 65,678 929,138 100.14% 2003 1,064,631 1,018,908 95.71% 75,045 1,093,953 102.75% 142 CITY OF BROOKLYN CENTER,MINNESOTA ' COMPUTATION OF LEGAL DEBT MARGIN Table 6 December 31,2003 (Unaudited) December 31, 2003 Market Value $1,840,115,300 Applicable Debt Limit(Percentage) 2% Debt Limit $36,802,306 Amount of Debt Applicable to Debt Limit: Total Bonded Debt $17,380,000 Less: Improvement Bonds p (5,705,000) State Aid Street Bonds (845,000) Tax Increment Bonds (4,505,000) Utility Revenue Bonds (450,000) Total Debt Applicable to Debt Limit $5,875,000 Legal Debt Margin $30,927,306 Source: City Finance and Assessing Department records i 143 -This page intentionally left blank- 144 r CITY OF BROOKLYN CENTER,MINNESOTA RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR Table 7 GENERAL BONDED DEBT TO TOTAL GENERAL EXPENDITURES Last Ten Fiscal Years (Unaudited) i Total Debt Service Total General as a Percent Fiscal Debt Fund of General Year Principal Interest Service Expenditures Expenditures 1994 $780,000 $1,080,555 $1,860,555 $9,942,058 18.71% 1995 825,000 1,075,976 1,900,976 10,559,497 18.00% 1996 (i) 5,125,000 1,106,661 6,231,661 10,908,340 57.13% 1997 - a 1 13� 000 1 017 ,128 2,152,128 11,739,733 18.33/0 r 1998 1,285,000 1,244,923 2,529,923 12,695,972 19.93% 1999 2,085,000 1,323,609 3,408,609 13,363,091 25.51% 2000 3,970,000 1,282,512 5,252,512 13,825,030 37.99% 2001 2,80 ,000 1,149,623 3,954,623 14,277,342 27.70% 2002 3,000,000 1,034,139 4,034,139 14,828,991 27.20% 2003 3,220,000 905,518 4,125,518 14,815,604 27.85% rSource: City Finance Department records ')Amounts for 1996 are higher because of the defeasance of the Tax Increment Bonds of 1985. 1 1 r r r r 145 r CITY OF BROOKLYN CENTER,MINNESOTA MISCELLANEOUS STATISTICAL DATA Table 8 December 31,2003 Page 1 of 2 (Unaudited) Date of incorporation February 14, 1911 1 Date of adoption of City Charter November 8, 1966 Date City Charter effective December 8, 1966 Form of government Council-Manager Fiscal year begins January 1 Area of City 8 1/2 square miles Miles of streets: City 105.856 County 6.49 State 10.79 Miles of sidewalks 34.8 Miles of trails 11.2 Miles of storm sewers 84.02 Number of street lights: Owned by NSP 915 Owned by City 172 City employees as of December 31,2003: Authorized regular full-time 150 Temporary or part-time 250 Total 410 Fire protection: Number of stations 2 ' Number of full-time employees 1 Number of volunteer firefighters 30 Police protection: Number of stations 1 Number of sworn police officers 45 Number of other full-time employees 15 Number of part-time employees 9 r r 146 ' CITY OF BROOKLYN CENTER,MINNESOTA MISCELLANEOUS STATISTICAL DATA Table 8 December 31,2003 Page 2 of 2 (Unaudited) Parks and Recreation: Park property totals 527 acres developed to serve a wide variety of recreational interests. The areas include playlots,playgrounds,playfields,trails,nature areas and an arboretum. Archery range 1 Playgrounds 20 Park shelters 9 Picnic shelters 10 Ice skating rinks 13 Hockey rinks 6 Softball diamonds 19 Baseball diamonds 5 Tennis courts 14 Basketball courts 19 Football/soccer fields 3 Municipal water plant: Number of connections 8,934 Average daily consumption in gallons 3,723,769 Peak daily consumption in gallons 9,728,000 Plant capacity-gallons per day 17,652,000 Miles of water mains 115 ' Number of fire hydrants 974 Number of wells 9 Number of elevated reservoirs 3 Storage capacity in gallons 3,000,000 t 147 t -This page intentionally left blank- i 1 1 1 148 ' CITY OF BROOKLYN CENTER,MINNESOTA TAX LEVIES AND TAX COLLECTIONS Table 9 Last Ten Fiscal Years (Unaudited) tCollections Percentage Collections of Current of Levy of Prior Total Delinquent Year's Taxes Collected Year's Taxes Collections Delinquent Taxes as Year Tax During Fiscal During During Total as Percent of Taxes Percent of Collected Levy* Period(" Fiscal Period Fiscal Period Collections Tax Levy Receivable Tax Levy 1994 $5,857,342 $5,634,255 96.19% ($176,148) $5,458,107 93.18% $246,311 * 4.21% 1995 6,501,197 6,367,437 97.94% (75,645) 6,291,792 96.78% 288,717 * 4.44% ' 1996 6,495,206 6,358,392 97.89% (11,917) 6,346,475 97.71% 208,862 * 3.22% 1997 6,746,487 6,626,336 98.22% (57,329) 6,569,007 97.37% 186,089 * 2.76% 1998 7,686,521 7,643,080 99.43% (51,327) 7,591,753 98.77% 146,907 * 1.91% 1999 7,896,858 7,824,214 99.08% 30,110 7,854,324 99.46% 165,926 * 2.10% 2000 8,099,965 8,044,715 99.32% 178,306 8,223,021 101.52% 75,070 * 0.93% ' 2001 8,420,298 8,119,854 96.43% (36,320) 8,083,534 96.00% 414,608 * 4.92% 2002 10,442,170 10,232,645 (2) 97.99% 219,067 10,451,712 100.09% 329,237 3.15% e2003 10,355,287 10,048,178 (Z) 97.03% 214,252 10,262,430 99.10% 391,585 3.78% ' Source: City Finance Department Records (')For years prior to 1994,the tax levy and collections include Homestead and Agricultural Aid Credit(HACA). Beginning 1 in 1994,state law arequired the City to certify its tax levy after subtracting HACA. Current tax collections include the market value homestead credit(MVHC). ' 149 CITY OF BROOKLYN CENTER,MINNESOTA , ASSESSED VALUE AND ESTIMATED MARKET VALUE OF ALL TAXABLE PROPERTY Last Ten Fiscal Years (Unaudited) 1994 1995 1996 1997 Population(1) 28,484 28,463 28,502 28,515 Real property: Taxable value: City: Residential $9,110,096 $9,045,048 $9,485,333 $9,182,859 Nonresidential 13,665,143 13,567,573 12,837,157 11,082,436 , Area-wide allocation (954,616) (687,295) (586,003) 226,287 21,820,623 21,925,326 21,736,487 20,491,582 , Less tax increment district 1,165,933 1,230,055 1,495,154 1,665,054 Total taxable value 20,654,690 20,695,271 20,241,333 18,826,528 Estimated market value 959,668,700 961,811,400 976,115,400 1,010,170,000 Personal property: , Assessed value 622,500 622,500 573,984 502,668 Estimated market value 13,532,600 13,532,600 12,477,900 12,566,700 Assessed value as a percent ' of estimated market value 2.19% 2.19% 2.11% 1.89% Per capita valuations: Assessed value $747 $749 $730 $678 Estimated market value $34,167 $34,267 $34,685 $35,867 Source: City Assessing Department and Hennepin County records (1)The Metropolitan Council is the source of population estimates. 150 ' Table 10 1998 1999 2000 2001 2002 2003 i28,535 28,535 29,172 29,172 29,172 29,185 19,309,893 19,976,862 18,928,738 $8,495,196 $9,362,788 $10,532,558 ' 10,657,588 11,002,424 14,093,094 9,225,991 9,430,533 9,821,308 537,406 1,504,330 746,438 635,875 875,145 1,097,596 20,504,887 22,483,616 23,768,270 18,357,062 19,668,466 21,451,462 2,054,659 2,533,878 3,296,624 2,450,218 2,538,825 3,134,417 18,450,228 19,949,738 20,471,646 15,906,844 17,129,641 18,317,045 1,085,605,600 1,164,801,300 1 311 055 600 1,475,520,200 1 659 884 400 1,840,115,300 452,849 437,707 452,680 262,882 273,072 280,568 13,006,300 13,053,100 13,593,500 13,312,100 13,927,600 13,927,600 1.72% 1.73% 1.58% 1.21% 1.04% 1.00% $662 $714 $717 $618 $597 $628 $38,501 $41,278 $45,408 $51,036 $57,377 $63,050 i 1 ' 151 CITY OF BROOKLYN CENTER,MINNESOTA DIRECT AND OVERLAPPING TAX RATES PER$1,000)AND TAX LEVIES Last Ten Fiscal Years (Unaudited) ' Tax Rates in Tax Capacity Rates(1) i School Districts(2) Year Vo-Tech No.286 No.279 Collectible City(2) School Earle Brown Osseo ' 1994 27.603 0.809 56.614 66.786 1995 31.090 0.000 76.861 70.142 1996 30.344 0.000 58.682 67.155 1997 32.875 0.000 56.260 62.666 1998 35.214 0.000 51.567 56.386 1999 36.269 0.000 59.807 54.337 2000 34.645 0.000 44.356 53.284 2001 35.996 0.000 47.139 56.764 2002 58.901 0.000 26.338 30.213 ' 2003 54.021 0.000 49.817 35.042 Tax Levies in Dollars School Districts(2) Year Vo-Tech No.286 No.279 , Collectible City(1) School Earle Brown Osseo 1994 $5,857,342 $166,681 $4,175,027 $3,472,013 ' 1995 6,501,197 - 5,367,479 3,288,144 1996 6,495,206 - 4,850,400 3,863,698 1997 6,746,487 - 4,472,206 3,708,238 1998 7,686,521 - 4,322,965 4,042,283 1999 7,896,858 - 4,293,610 3,800,203 2000 8,099,965 - 4,218;907 3,670,533 2001 8,420,298 - 4,238,284 4,073,436 2002 10,442,170 - 2,032,254 2,064,398 2003 10,354,806 - 2,483,847 4,342,594 Source: City Assessin Department and Hennepin County Records. (1) Tax levy includes Brooklyn Center EDA and HRA. (2) Beginning in 1998,a portion of the school levy shown was paid by the state as an education homestead credit. The state-paid portion totaled$2,333,306 in 2001. 152 Table 11 ' Hennepin School Districts(2) County & Total City,School,and County No.281 No. II Special No.286 No.279 No.281 No. ll Robbinsdale Anoka Districts Earle Brown Osseo Robbinsdale Anoka 64.401 57.161 44.248 128.701 138.873 136.488 128.439 67.197 61.402 45.370 151.763 145.044 142.099 136.304 64.762 64.387 44.170 133.196 141.669 139.276 138.901 63.757 55.588 42.174 131.309 137.715 138.806 130.637 65.350 51.824 45.869 132.650 137.469 146.433 132.907 47.716 54.856 50.276 146.352 140.882 134.261 141.401 48.492 51.792 37.679 127.806 136.743 131.942 135.242 46.678 52.224 45.803 128.938 138.583 128.477 134.023 ' 30.092 29.082 57.795 143.034 146.788 146.909 145.778 29.179 26.941 58.364 162.202 147.427 141.564 139.326 Hennepin Total otal County& City, ' No.281 No. 11 Special Schools and Robbinsdale Anoka Districts County ' $4,526,288 $1,287,264 $9,384,582 $28,869,197 4,814,025 1,269,585 8,557,035 29,797,465 4,397,705 1,441,657 9,403,100 30,451,766 3,899,126 1,361,059 8,854,518 29,041,634 3,750,650 1,420,301 8,964,681 30,187,401 3,150,416 1,276,178 9,471,114 29,888,379 3,116,096 1,316,096 9,916,918 30,338,515 3,076,541 1,407,502 9,677,991 30,894,052 2,015,705 685,458 9,001,798 26,241,783 2,808,387 1,402,903 10,152,265 31,544,802 e 153 CITY OF BROOKLYN CENTER,MINNESOTA ' RATIO OF NET BONDED DEBT TO ASSESSED VALUE AND Table 12 NET BONDED DEBT PER CAPITA Last Ten Fiscal Years ' (Unaudited) Less Ratio of Amounts Net Bonded Net Tax Gross in Debt Net Debt to Bonded Fiscal Estimated Capacity Bonded Service Bonded Tax Capacity Debt Per Year Population Value Debt(1) Fund Debt Value Capita 1994 28,484 $21,277,190 $ - $ - $ - 0.00% $ - 1995 28,463 21,317,771 - - - 0.00% - 1996 28,502 20,815,317 - - - 0.00% - 1997 28,515 19,329,196 7,900,000 82 056 7,817,944 40.45% 274.17 0 1998 28,535 18,903,047 7,900,000 616,778 7,283,222 38.53% 255.24 1999 28,535 20,387,445 7,575,000 725,868 6,849,132 33.59% 240.03 ' 2000 29,172 20,924,326 7,175,000 725,930 6,449,070 30.82% 221.07 2001 29,172 18,357,062 6,760,000 831,651 5,928,349 32.29% 203.22 2002 29,172 18,793,321 6,325,000 871,970 5,453,030 29.02% 186.93 ' 2003 29,185 19,066,393 5,875,000 985,509 4,916,491 25.79% 168.46 Source: City Finance Department and Hennepin County records , (1) Amount does not include tax increment,state aid street,special assessment,or revenue bonds. 154 I CITY OF BROOKLYN CENTER,MINNESOTA ' COMPUTATION OF DIRECT AND OVERLAPPING DEBT Table 13 December 31,2003 (Unaudited) Governmental Unit City's Share Gross Debt Sinking Funds Net Debt Percent Amount Direct Debt-City of Brooklyn Center(1) $6,325,000 $871,970 $5,453,030 100.00% $5,453,030 Overlapping debt: School Districts: No.281 Robbinsdale 155,070,000 7,297,893 147,772,107 5.51% 8,142,243 No. 11 Anoka 219,612,177 47,012,261 172,599,916 1.38% 2,381,879 No.279 Osseo 274,880,000 77,953,767 196,926,233 5.47% 10,771,865 No.286 Earl Brown 31,480,000 337,523 31,142,477 100.00% 31,142,477 Met Council 209,515,000 54,465,000 155,050,000 1.18% 1,829,590 Hennepin County 325,845,000 5,389,373 320,455,627 1.58% 5,063,199 ' Hennepin Regional RR Authority 49,395,000 591,197 4 0 8,803,803 1.69/0 824,784 Hennepin County Park Reserve District 29,335,000 4,053,783 25,281,217 2.25% 568,827 ' Total overlapping debt 1,295,132,177 197,100,797 1,098,031,380 60,724,864 Total direct and overlapping debt $1,301,457,177 $197,972,767 $1,103,484,410 $66,177,894 ' Direct Overlapping PP g Total Debt Debt ' Comparative Net Debt Ratios Chargeable to City Debt to tax capacity value $18,793,321 352.14% 29.02% 323.12% Debt to market value $1,673,812,000 3.95% 0.33% 3.62% Per capita debt,population 29,172 $2,268.54 $186.93 $2,081.61 Source: City Finance Department,Hennepin County,and I.S.D.#11 records. (1) Includes only general obligation debt which is repaid through property taxes. 155 CITY OF BROOKLYN CENTER,MINNESOTA ' PRINCIPAL TAXPAYERS Table 14 2003 (Unaudited) , %of ' 2003 Total City Net Tax Capacity Taxpayer Type of Business Tax Capacity Value Talisman Brookdale,LLC Shopping Center $1,260,780 6.00% Target Sores Retail 707,460 3.37% ' BCC Associates,LLC/Reliastar Office 485,273 2.31% Regal Cinemas,Inc. Theater 336,460 1.60% Brookdale Corner,LLC Retail 321,840 1.53% ' Hennepin County Hotel Association Hotel 302,460 1.44% TLN LA NEL Apartement 300,420 1.43% , Sears Roebuck and Co. Department Store 293,400 1.40% DJS Holdings,Inc. Industrial 266,400 1.27% Wickes Furniture Company Industrial 261,970 1.25% ' Total Market Value $4,536,463 21.60% Total Cit y Mark ' et Value $21,015,823 Source: City Assessin g Department records r 156 1 CITY OF BROOKLYN CENTER,MINNESOTA PROPERTY VALUE AND CONSTRUCTION Table 15 Last Ten Fiscal Years (Unaudited) ' Commercial New Residential Building Permits Issued Construction Construction Property Value ' Estimated Year Number Cost Value Units Value Commercial Residential Non-Taxable ' 1994 607 $13,418,453 $5,504,477 9 $587,000 $301,702,300 $671,499,000 $109,600,200 1995 603 11,948,205 9,541,847 2 153,000 297,268,000 678,076,000 110,458,200 e1996 607 16,647,400 12,527,095 18 1,126,000 284,786,600 703,806,700 108,473,400 1997 796 18,274,806 10,905,475 3 225,000 287,163,000 722,917,000 111,226,700 ' 1998 1,482 23,216,525 14,261,800 4 612,900 314,457,700 770,883,400 152,964,200 1999 1,745 44,188,569 10,528,100 7 679,600 333,929,200 832,334,600 155,999,500 2000 1,299 20,450,844 13,254,213 3 311,800 358,293,500 837,022,400 164,002,100 2001 956 63,947,218 10,750,000 4 464,000 367,026,000 970,653,400 165,437,000 2002 976 58,089,510 18,680,014 10 1,335,000 529,390,100 1,130,494,300 163,517,000 ' 2003 886 53,918,257 25,423,800 9 1,370,100 557,643,000 1,251,467,299 168,892,900 ' Source: City Finance,Assessing and Community Development Department records. e I'' ' 157 CITY OF BROOKLYN CENTER,MINNESOTA ' DEMOGRAPHIC STATISTICS Table 16 Last Ten Fiscal Years (Unaudited) School Enrollments 4 City Minneapolis No.286 Fiscal Unemployment St.Paul No. 11 No.279 No.281 Earle ' Year Population(1) Rate(2) C.P.I.(3) Anoka Osseo Robbinsdale Brown 1994 28,484 3.4% 3.2% 38,344 21,216 14,072 1,875 1995 28,463 3.1% 2.9% 39,152 21,479 13,595 1,658 1996 28,502 3.0% 3.1% 39,874 21,664 14,099 1,664 , a o 1997 28,515 2.3% 2. / 40,402 21,992 14,010 1,746 1998 28,535 1.9% 2.0% 40,923 22,028 13,966 1,788 , 1999 28,535 2.4% 2.2% 40,964 22,171 13,800 1,734 2000 29,172 3.0% 2.6% 41,314 22,017 13,706 1,682 ' 2001 29,172 3.9% 3.3% 41,419 22,041 13,754 1,724 , 2002 29,172 4.8% 4.2% 41,383 21,824 13,656 1,732 2003 29,185 5.9% 1.7% 41,254 21,698 13,762 1,732 ' (1) Source: Metropolitan Council (2) Source: Minnesota Department of Economic Security;average rate for the past year ' (3) Source: U.S.Bureau of Labor (4) Source: Minnesota Department of Children,Families&Learning(Brooklyn Center has parts of these four Districts within the City) , 158 ' CITY OF BROOKLYN CENTER,MINNESOTA SCHEDULE OF REVENUE BOND COVERAGE Table 17 Last Ten Fiscal Years (Unaudited) Net Net Revenue ' Operating Non-Operating Gross Revenue to Debt Year Revenue Revenue Revenue Expenses(1) Available Principal Interest Total Service Storm Drainage Fund 1994 $685,011 $39,930 $724,941 $211,425 $513,516 $ - $30,208 $30,208 17.00 :1 1995 788,897 72,881 861,778 184,990 676,788 - 90,625 90,625 7.47 :1 1996 822,980 47,363 870,343 204,969 665,374 110,000 86,390 196,390 3.39 :1 1997 856,920 130,651 987,571 198,662 788,909 155,000 79,754 234,754 3.36 :1 1998 940,012 916,860 1,856,872 199,694 1,657,178 165,000 72,227 237,227 6.99 :1 1999 999,867 1,257,928 2,257,795 156,562 2,101,233 170,000 64,193 234,193 8.97 :1 2000 1,074,619 313,068 1,387,687 154,183 1,233,504 180,000 59,144 239,144 5.16 :1 2001 1,129,502 280,740 1,410,242 157,110 1,253,132 190,000 53,166 243,166 5.15 :1 2002 1,377,638 435,548 1,813,186 231,741 1,581,445 200,000 36,701 236,701 6.68 :1 2003 1,264,512 148,854 1,413,366 295,522 1,117,844 210,000 24,990 234,990 4.76 :1 e Source: City Finance Department records. ' (1)Excludes depreciation and interest on bonds. 159 . I_ CITY OF BROOKLYN CENTER,MINNESOTA ' SCHEDULE OF INSURANCE COVERAGE Table 18 Effective January 1,2003 Page 1 of 2 (Unaudited) Policy Period Type of Coverage and Details From To Liability Limits I. Statutory Liability to Employees , a. Worker's Compensation(participant in the 04/01/03 04/01/04 ' League of Minnesota Cities Insurance Trust Self-Insured Workers'Compensation Program) II. Liability to the Public ' a. Comprehensive general liability includes the following additional coverages: , (a) All employees as additional insureds (b) Personal injury coverage to include false arrest,libel,slander,wrongful entry or eviction,or invasion of right of privacy. ' (c) Broad contractual liability (d) Products liability (e) Public officials' liability (1) Bodily injury 04/01/03 04/01/04 $1,000,000 occurrence (2) Property damage 04/01/03 04/01/04 $1,000,000 occurrence (3) Personal injury 04/01/03 04/01/04 $1,000,000 occurrence ' b. Automobile liability,comprehensive 04/01/03 04/01/04 (1) Bodily injury $1,000,000 occurrence ' (2) Property damage $1,000,000 occurrence (3) Uninsured motorist $1,000,000 occurrence c. Liquor stores'dram shop 01/01/03 01/01/04 $1,000,000 occurrence ' $1,000,000 annual aggregate d. Golf Course and Central Park liquor liability 01/01/03 01/01/04 $1,000,000 occurrence , $1,000,000 annual aggregate e. Personal accident,Volunteers 01/01/03 01/01/04 $100,000 accidental death $100,000 permanent impairment $400/week short-term disability $1,000 medical $500,000 per accident 160 ' CITY OF BROOKLYN CENTER,MINNESOTA SCHEDULE OF INSURANCE COVERAGE Table 18 Effective January 1,2003 Page 2 of 2 ' (Unaudited) Buildings,Structures, Policy Period and Contents Type of Coverage and Details From To (Replacement Cost) III. Insurance on City Property 04/01/03 04/01/04 a. Public and institutional property,all risk, blanket$38,437,934;$1,000 deductible replacement value on buildings. (1) Civic Center $10,699,000 (2) East Fire Station $1,591,300 (3) West Fire Station $3,429,600 (4) Municipal Service Garage $3,350,500 (5) Elevated Water Towers-3 locations $4,312,000 ' (6) Park Shelter Buildings- 17 locations $1,290,118 (7) Pump Houses- 10 locations $1,127,650 (8) Lift Stations- 10 locations $1,358,627 (9) Meter Station $20,050 (10)Storage Building $523,700 (11)Outdoor lighting systems-7 locations $346,000 (12)Leased Liquor Store $482,100 (13)Pedestrian Bridge-2 locations $1,357,908 (14)Picnic Shelters(4) $197,725 (15)Earle Brown Heritage Center $12,186,140 (16)Centerbrook Golf Course Club House $414,500 (17)Centerbrook Golf Course-Garage $50,950 (18)Lions Park Concession Stand $44,700 (19)Police Station $5,770,640 ' (20)Centerbrook Golf Course Maintenance Building $216,000 (21)Centerbrook Golf Course-Property in the Open $106,000 (22)Parks-Property in the Open $616,305 Liability Limits b. Boiler and machinery 04/01/03 04/01/04 $5,000,000 per accident ec. Automotive physical damage 04/01/03 04/01/04 (1) Comprehensive ACV-$1,000 deductible (2) Collision ACV-$1,000 deductible ' IV Criminal Acts a. Faithful performance blanket position $500,000 per occurrence b. Money and securities(broad form) Various c. Depositor's forgery $100,000 161 1 � Tautges Redpath, Ltd. Certified Public Accountants and Consultants Independent Auditor's Report on Compliance With Minnesota Legal Compliance Guide for Local Government To the Honorable Mayor and Members of the City Council City of Brooklyn Center, Minnesota We have audited the basic financial statements of the City of Brooklyn Center, Minnesota, as of and for the year ended December 31, 2003 and have issued our report thereon dated May 27, 2004. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the provisions of the Minnesota Legal Compliance Audit Guide for Local Government promulgated by the State Auditor pursuant to Minnesota Statutes Section 6.65. Accordingly, the audit included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. The Minnesota Legal Compliance Audit Guide for Local Government covers five main categories of compliance to be tested: contracting and bidding; deposits and investments; conflicts of interest; public indebtedness; and claims and disbursements. Our study included all of the listed categories. The results of our tests indicate that for the items tested,the City of Brooklyn Center, Minnesota complied with the material terms and conditions of applicable legal provisions, except as described in this report. This report is intended solely for the information and use of the City of Brooklyn Center, Minnesota's City Council and management and is not intended to be, and should not be, used by anyone other than these specified parties. May 27, 2004 HLB TAUTGES REDPATH, LTD. Certified Public Accountants White Bear Lake Office:4810 White Bear Parkway,White Bear Lake, Minnesota 55110, USA Telephone:651 426 7000 Fax: 651 426 5004 Hastings Office:1303 South Frontage Road,Suite 13, Hastings, MN 55033, USA Telephone: 651 480 4990 Fax: 651 426 5004 HLB Tautges Redpath,Ltd.is a member of®International. A world-wide organization of accounting firms and business advisers. 1 Tautges Redpath, Ltd. Certified Public Accountants and Consultants Independent Auditor's Report on Compliance and on Internal Control over Financial Reporting Based on an Audit of Financial Statements Performed in Accordance with Government Auditinz Standards To the Honorable Mayor and Members of the City Council City of Brooklyn Center, Minnesota We have audited the basic financial statements of the City of Brooklyn Center, Minnesota as of and for the year ended December 31, 2003, and have issued our report thereon, dated May 27, 2004. 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. Compliance As part of obtaining reasonable assurance about whether the City of Brooklyn Center, Minnesota's basic financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards. Internal Control Over Financial Reporting In planning and performing our audit, we considered the City of Brooklyn Center, Minnesota's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinions on the basic financial statements and not to provide assurance on the internal control over financial reporting. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control over financial reporting that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the basic financial statements being audited may occur and not be detected within a timely period by employees in the normal course of White Bear Lake Office:4810 White Bear Parkway,White Bear Lake, Minnesota 55110, USA Telephone: 651 426 7000 Fax: 651 426 5004 Hastings Office. 1303 South Frontage Road, Suite 13, Hastings, MN 55033, USA Telephone: 651 480 4990 Fax: 651 426 5004 HLB Tautges Redpath,Ltd.is a member of 0 International. A world-wide organization of accounting firms and business advisers. Independent Auditor's Report on Compliance and on Internal Control over Financial Reporting Page 2 performing their assigned functions. We noted no matters involving the internal control over financial reporting and its operation that we consider to be material weaknesses. This report is intended solely for the information and use of the City of Brooklyn Center, Minnesota's City council and management and is not intended to be, and should not be, used by anyone other than those specified parties. May 27, 2004 HLB TAUTGES REDPATH, LTD. Certified Public Accountants CITY OF BROOKLYN CENTER, MINNESOTA AUDIT MANAGEMENT LETTER ' December 31, 2003 1 ' Tautges Redpath, Ltd. Certified Public Accountants and Consultants ' To the Honorable Mayor and Members of the City Council City of Brooklyn Center, Minnesota ' We have completed the 2003 audit of the City of Brooklyn Center and have issued our report thereon. Our Independent Auditor's Report is included in the City's Comprehensive eAnnual Financial Report. This Audit Management Letter provides a summary of audit results along with comparisons and trend analysis of financial data. Thank you for the opportunity to serve the City. We are available to discuss this report with you. June 23, 2004 HLB TAUTGES REDPATH, LTD. Certified Public Accountants A 1 e ' White Bear Lake Office:4810 White Bear Parkway,White Bear Lake, Minnesota 55110, USA Telephone: 651 426 7000 Fax: 651 426 5004 Hastings Office:1303 South Frontage Road, Suite 13, Hastings, MN 55033, USA Telephone: 651 480 4990 Fax:651 426 5004 ' HLB Tautges Bedpath,Ltd.is a member of®International. A world-wide organization of accounting firms and business advisers. L hill"m. e Audit Management Letter Report Summary REPORT SUMMARY Several reports are issued in conjunction with the audit. A brief summary is as follows: Report of p• Overview Required Reports Comprehensive Annual Financial • Financial statements • Unqualified("clean")opinion Report(CAFR) • Footnotes on the Basic Financial • Supplemental information Statements Report on Compliance and Internal • Internal controls over financial • No reportable conditions in Control reporting internal control • Compliance with laws, • No findings of regulations,contracts and noncompliance with laws, grants regulations,contracts and grants State Legal Compliance Report • Results of testing certain • No findings of provisions of Minnesota noncompliance Statutes Federal Single Audit Report • Report on compliance with • To be issued in July 2004 ' program requirements i Audit Management Letter Executive Summary EXECUTIVE SUMMARY Several areas highlighted for your reference include the following: ' The City has an excellent property tax collection rate (97% for 2003). Page 7 ' The special assessment collection rate was 95% for 2003. Page 8 The Earle Brown Farm TIF District has an interfund loan to finance the cash deficit. Minnesota Statutes require formal approval by the City council. We recommend the City monitor compliance with this statutory provision. Page 9 The City's current General Fund balance policy addresses working capital. ' There are possible additional fund balance reserve needs. We suggest the City review its current policy and determine if additional reserves and , appropriate. Page 15 The City established two new capital project funds during 2003—the Street Reconstruction Fund and the Technology Fund. Page 36 ' The City was awarded the Certificate of Achievement for Excellence in Financial Reporting for its 2002 Comprehensive Annual Financial Report ' (CAFR). Page 50 Audit Management Letter GASB 34— The Reporting Model REPORTING MODEL 3 GA B 4—THE REP $ O The City of Brooklyn Center implemented for 2003 the Governmental Accounting Standards Board's Statement No. 34,Basic Financial Statements—and Management's Discussion and Analysis—for State and Local Governments. This accounting standard significantly changes how state and local governments report their financial activity to the public. In general, the new standards make government financial reporting more like the private sector. The most significant changes to the financial statements are as follows: • Government-wide financial statements (Statements 1 and 2 of the Comprehensive Annual Financial Report) are prepared using full accrual accounting for all of the City's activities. • Fund Financial Statements (Statements 3 through 8 and the Notes) focus on major funds rather than fund types. • Budgetary comparisons (Statements 10 through 12)includes both original and ' amended budgets. • All capital assets are depreciated on the government-wide financial statements. • A Management's Discussion and Analysis (MD&A) is included in the financial statements. This provides an overview and analysis of the basic financial statements. Audit Management Letter Financial Statement Analysis FINANCIAL STATEMENT ANALYSIS The basic financial statements of the City of Brooklyn Center are presented in Statements 1 through 8 of the 2003 Comprehensive Annual Financial Report. i Summary of Financial Activity A summary of financial activity for 2003 is as follows: Increase Fund Balance (decrease)in (Deficit) Transfers Fund Balance/ Net Assets Fund Revenue Expenditures (Net) Net Assets 12/31/03 General $14,902,910 $12,620,949 ($2,194,655) $87,306 $8,017,080 Special Revenue: Housing and Redevelopment Authority 207,854 - (207,854) - - Economic Development Authority 370,984 363,418 207,854 215,420 1,488,766 Earle Brown TIF District 838,056 55,969 (653,000) 129,087 (1,685,368) TIF District No.3 2,390,004 579,559 (548,000) 1,262,445 6,119,290 TIE District No.4 246,968 205,425 41,543 106,765 Police Drug Forfeiture 28,677 13,379 15,298 74,168 ' CDBG 201,000 201,000 - - City Initiatives Grant 482,338 388,991 - 93,347 107,398 Debt Service: General Obligation 300,715 1,036,913 771,937 35,739 907,709 , Tax Increment 10,360 1,987,128 1,201,000 (775,768) 1,436,694 Special Assessment 1,188,592 1,127,556 259,079 320,115 2,976,874 Capital Projects: Capital Reserve Emergency 31,439 24,356 - 7,083 1,336,573 Capital Improvements 139,802 368,047 225,000 (3,245) 1,757,730 Municipal State Aid for Construction 145,459 335,609 - (190,150) 430,581 Infrastructure Construction 1,651,877 1,454,747 480,000 677,130 229,179 Earle Brown Heritage Center Improvements 1,358 93,195 - (91,837) 8,163 Street Reconstruction 252 - 283,639 283,891 283,891 Technology - - 275,000 275,000 275,000 Enterprise: Municipal Liquor 3,430,062 3,278,029 (100,000) 52,033 1,218,552 Golf Course 295,450 287,983 7,467 949,312 Earle Brown Heritage Center 3,406,413 3,752,816 (346,403) 9,632,799 Recycling and Refuse 217,747 223,679 (5,932) 93,937 Street Light Utility 209,319 147,293 62,026 123,344 Water Utility 1,577,309 1,639,691 (62,382) 10,517,661 Sanitary Sewer 2,947,464 2,556,224 391,240 10,400,265 Storm Drainage 1,413,366 834,965 578,401 11,453,075 Internal Service: Central Garage 1,125,893 1,247,662 (121,769) 6,775,737 Retirement 25,537 38,615 (13,078) 17,140 Compensated Absences 12,191 26,124 (13,933) 12,191 Total $37,799,396 $34,889,322 $0 $2,910,074 $75,064,506 Audit Management Letter Financial Statement Analysis Cash and Investments Cash and investment balances of Minnesota cities are commonly restricted by statutory requirements and long range financial planning objectives. The following schedule illustrates this point by presenting cash and investment balances by fund type. Cash and Investment Balances December 31, Increase Fund Type 2002 2003 (Decrease) General $8,370,480 $8,145,364 ($225,116) Special Revenue 5,595,051 7,125,845 1,530,794 Debt Service 5,746,017 5,383,740 (362,277) Capital Projects 3,082,308 2,789,339 (292,969) Enterprise 4,157,378 5,985,200 1,827,822 Internal Service 6,514,190 6,901,188 386,998 Totals $33,465,424 $36,330,676 $2,865,252 Cash balances of Minnesota cities are common] restricted b statutory requirements Y Y ' and long-range financial planning objectives. Eel • : • • Iq Audit Management Letter Financial Statement Analysis Property Taxes The City has consistently experienced a solid collection rate for property taxes. A summary of the tax levy, tax rate and collection rate for the last eight years is as follows: Tax Tax Unpaid Tax Collection Capacity Taxes as of Year Levy Rate Rate 12/31/2003 1996 $6,495,206 97.9% 30.344 $ - 1997 6,746,487 98.2% 32.875 - 1998 7,687,124 99.4% 35.214 27,760 1999 7,896,858 99.0% 36.269 3,769 2000 8,100,334 99.3% 34.645 5,222 2001 8,199,094 96.4% 35.996 18,162 2002 10,442,170 98.0% 57.704 56,630 2003 10,355,287 97.0% 52.792 280,042 Total $391,585 The tax levy increase for 2002 relates to the elimination of HACA(the City received $1,380,000 in 2001 . At December 31 2003 the delinquent tax receivable was $391,585 representing approximately 3.8% of the 2003 property tax levy. Tax Increments A summary of tax increment activity is as follows: Delinquent Less Delinquent Receivable 2003 OSA 2003 Receivable No. Name 12/31/2002 Levy TIF Fee Collections Adjustments 12/31/2003 1 Brookwood Housing $1,288 $233,217 ($801) $230,825 $ - $2,879 2 Earle Brown Farm 52,444 702,531 (2,176) 602,132 (37,696) 112,971 3 TIF#3 Redevelopment 95,989 2,615,300 (8,329) 2,311,663 (218,672) 172,625 4 France Avenue Business Park - 247,860 (892) 246,968 - Total $149,721 $3,798,908 ($12,198) $3,391,588 ($256,368) $288,475 I Audit Management Letter Financial Statement Analysis Special Assessments The City has experienced a solid collection rate for special assessments. A summary of the collection rate for the last seven years is as follows: Special Assessment Collection Rate Collection Year Rate(1) 1996 94.7% 1997 95.4% 1998 96.9% 1999 95.4% 2000 95.7% 2001 90.7% 2002 93.1% 2003 95.4% (1)Current collections as a percent of Icurrent levy. Audit Management Letter Financial Statement Analysis Interfund Payables/Receivables Advances to Other Funds. The City had the following interfund advances at December 31, 2003: Fund Receivable Payable General Fund $105,074 $ - MSA Construction Fund 593,069 Earle Brown TIF Fund - 698,143 Capital Improvements Fund 885,000 - Golf Course Fund - 885,000 Capital Reserve Emergency Fund 709,969 - Infrastructure Construction Fund - 709,969 Total $2,293,112 $2,293,112 The interf ind loan to the Earle Brown TIF Fund was established in 1987. This loan does not have a formal repayment plan. We recommend the City consider establishing terms for this loan. The interfund loan to the golf course was established in 1998. The loan is interest fee and has annual payments of$55,000 to $65,000 through 2017. For 2003 the amount paid down on the loan was $15,000. The interfund loan to the Infrastructure Construction Fund was to finance special assessments of the 2003 Happy Hollow Area neighborhood improvements. 1 Audit Management Letter Financial Statement Analysis Due to Other Funds. Several funds have a negative cash balance at December 31, 2003. The funds with negative cash balances in effect"borrowed" from funds with positive cash balances. When this situation occurs, accounting standards require the cash overdraft to be reported as an interfund borrowing or"due to other funds." The City had the following due to/due from other funds at December 31, 2003: Receivable Payable Tax Increment No. 3 Fund $1,043,323 $ - Earle Brown Farm TIF Fund 1,043,323 Capital Reserve Emergency Fund 158,933 - MSA for Construction Fund 158,933 Total $1,202,256 $1,202,256 TIF District Interfund Borrowings. The Minnesota Legislature amended the TIF act by requiring cities to formally approve interfund loans to TIF districts. M.S. 469.178, Subdivision 7, reads as follows: Subd.7 Interfund loans The authority or municipality may advance or loan money to finance expenditures under section 469.176, subdivision 4, from its general fund or any other fund under which it has legal authority to do so. The loan or advance must be approved, by resolution of the governing body, before money is transferred, advanced or spent, whichever is earliest. The terms and conditions for repayment of the loan must be provided in writing and include, at a minimum, the principal amount, the interest rate, and maximum term. The maximum rate of interest permitted to be charged is limited to the greater of the rates specified under section 270.75 or 540.09. Eel • a. • • Iq Audit Management Letter Financial Statement Analysis [Effective date: This section is effective for loans and advances made after July 31, 2001, and to districts with requests for certification after July 31, 1979. Interfund loans and advances made before August 1, 2001, are ratified and approved, subject to the following restrictions: 1) the interest accrued or paid after July 31, 2001 may not exceed the limit in this section and 2)if there is no resolution or other document created contemporaneously with the making of the loan or advance that specifies the principal amount of the loan or advance,the principal amount of the loan or advance is limited to a maximum amount equal to the largest negative cash balance that existed at any time in the fund that received the undocumented loan or advance. An authority or municipality may modify the terms of an interfund loan or advance made before August 1,2001,to comply with any of the requirements of this section as the authority or municipality deems , appropriate. We recommend the City determine that compliance with the above statute is monitored. AuditManagement Letter General Fund GENERAL FUND The General Fund of the City accounts for current operating expenditures common to all cities. These basic services include (but are not limited to)public safety, public works, parks and recreation, community services and general government. For the City of Brooklyn Center, the General Fund is financed by three major sources: 1)taxes; 2)intergovernmental; and, 3) charges for services. A graph of the major revenue sources is as follows: $12,000,000 $11,000,000 $10,000,000 $9,000,000 $8,000,000 $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 1999 2000 2001 2002 2003 —Intergovernmental $3,911,480 $4,076,169 $4,135,282 $2,843,629 $1,948,457 f Taxes $8,219,491 $8,745,172 $8,411,513 $11,257,003 $10,799,074 �ALI Othe, $1,902,821 $1,827,025 $2,405,376 $1,990,604 $2,155,379 Audit Management Letter General Fund The fund balance of the General Fund increased by $87,306 in 2003 as follows: Budget Actual Variance Revenue $15,408,271 $14,902,910 ($505,361) Expenditures 14,543,861 13,228,170 1,315,691 Increase(decrease)before other financing sources 864,410 1,674,740 810,330 Other financing sources(uses): Transfers from other funds 784,084 607,221 (176,863) Transfers to other funds (1,648,494) (2,194,655) (546,161) Increase(decrease)in General Fund balance $0 $87,306 $87,306 As shown above, revenue was under budget by $505,361. A summary of the revenue variances are as follows: Over (Under) Budget Property taxes $261,600 Licenses and permits 214,965 Intergovernmental (1,050,728) All other 68,802 Total ($505,361) Audit Management Letter General Fund The City's December 31, 2003 fund balance was $8,017,080. The City's General Fund balance has been as follows for the past six years: $9,000,000 - $8,000,000 General Fund Balance - -- $7,000,000 $6,000,000 M ,\ $5,000,000 ..:, $4,000,000 $3,000,000 $2,000,000 ,,,r •.::;:;.:...,:,::::.. �..:««::>::.::.:: ;;.:.<::::>:;;;, $1,000,000 $0 :> u.> 1999 2000 2001 2002 2003 i Audit Management Letter General Fund A summary of General Fund balance for the past three years is as follows: General Fund Balance Component 12/31/2001 12/31/2002 12/31/2003 Reserved for advances to other funds $105,074 $105,074 $105,074 Designated for working capital 6,437,653 6,527,973 6,031,077 Subtotal 6,542,727 6,633,047 6,136,151 Reserved for prepaids - 68,279 5,309 Undesignated 891,145 1,228,448 1,875,620 Total $7,433,872 $7,929,774 $8,017,080 Working Capital Reserve The City adopted an "adequate fund balance policy formula" in 1980. This policy defines the minimum fund balance elements as follows: 2001 2002 2003 1. Items not readily convertible to cash: a. Accounts receivable $67,160 $53,489 $57,908 b. Advances to other funds 105,074 105,074 105,074 c. Restricted assets - - 131,153 2. Amount appropriated to the ensuing year's budget 19,305 - - i 3. Amounts reserved to working capital (45%of current year budget less debt service) 6,351,188 6,474,484 5,842,016 $6,542,727 $6,633,047 $6,136,151 Audit Management Letter General Fund ■►' Property taxes and state aids account for approximately 86% of the revenue of the General Fund. Property taxes and state aids are not received until July and December of each year(i.e., the second half of the year). As a result, the City is required to have sufficient working capital reserves at the beginning of the year to fund operations of the first half of the year. A summary of the purposes of General Fund reserve balances is as follows: Cash Flow Timing Difference XXXX XXX XX Intergovernmental Capital Outlay XXX Revenue Cutbacks Replacement *kv �' . . **., r++' Emergency or XXXX Special Projects ......... The City's current fund balance policy addresses working capital. As shown above, there are additional fund balance reserve needs. We recommend the City review its current policy and determine if additional reserves are appropriate. • Audit Management Letter General Fund A summary of the benefits of General Fund reserves is illustrated below: .0. �� erV �t��n+ +�� XXX XXX Favorable bond rating Supplements revenues indicator with investment income Provides resources for Avoids temporary minor projects or overdrafts prior to major feasibility reports receipts Provides the City XXXXXXIX greater options to deal Avoids overburdening of annual budgets for with unelected events certain capital outlay Audit Management Letter Special Revenue Funds SPECIAL REVENUE FUNDS Special Revenue Funds are a classification of funds to account for activities segregated by City policy, Federal or State statutes for specific purposes. The City maintained eight Special Revenue Funds during 2003. Housing and Redevelopment Authority Fund (202) The HRA has authority to levy an ad valorem property tax for housing and redevelopment purposes. The HRA Fund accounts for property tax levies. A summary of financial activity is as follows: Housing and Redevelopment Authority 2001 2002 2003 Revenue and other sources: Property taxes 147,123 194,766 207,854 Intergovernmental 19,684 - - Total revenue and other sources 166,807 194,766 207,854 Expenditures and other uses: Transfer to EDA 166,807 194,766 207,854 Increase in fund balance 0 0 0 Fund balance-January 1 - - - Fund balance-December 31 $0 $0 $0 Pursuant to MS 469.033 the HRA's le limit is an amount equal to 0.0144% of levy q taxable market value. to R • : • • q - Audit Management Letter Special Revenue Funds Economic Development Authority Fund (203) The EDA Fund accounts for the financial activity of the EDA. In addition to this fund, the Earle Brown Heritage Center Fund accounts for the EDA operations of the Center. A summary of financial activity is as follows: Economic Development Authority 2001 2002 2003 Revenue and other sources: Property taxes $205,694 $5,974 $36 Intergovernmental 11116,842 53,623 188,495 Investment earnings 139,514 29,440 20,276 Other 57,863 49,000 89,002 Sale of fixed assets 572,266 474,648 73,175 Transfer from CDBG - 13,500 - Transfer from HRA 166,807 194,766 207,854 Total revenue and other sources 2,258,986 820,951 578,838 Expenditures and other uses: Personal services 197,686 176,508 124,580 Supplies 33 579 2,962 Services and other charges 1,249,143 154,052 235,876 Capital outlay 1,076,721 - - Total expenditures and other uses 2,523,583 331,139 363,418 Increase(decrease)in fund balance (264,597) 489,812 215,420 Fund balance-January 1 1,048,131 783,534 1,273,346 Fund balance-December 31 $783,534 $1,273,346 $1,488,766 • Audit Management Letter Special Revenue Funds TIF District No.2 - Earle Brown Farm TIF Fund (277) The Earle Brown Farm TIF Fund accounts for TIF No. 1 (Brookwood Housing) and TIF No. 2 (Earle Brown Farm). A summary of financial activity is as follows: Earle Brown TIF 2001 2002 2003 Revenue and other sources: Tax increment $1,035,349 $815,568 $833,553 Investment earnings 6,628 4,503 Total revenue and other sources 1,041,977 815,568 838,056 Expenditures and other uses: Personal services - 4,210 18,235 Interest 30,229 11,516 26,420 Services and other charges 1,657 2,050 11,314 Transfer to Tax Increment Bonds Debt Service 1,390,000 1,410,000 653,000 Total expenditures and other uses 1,421,886 1,427,776 708,969 Increase(decrease)in fund balance (379,909) (612,208) 129,087 Fund balance(deficit)-January 1 (822,338) (1,202,247) (1,814,455) Fund balance(deficit)-December 31 ($1,202,247) ($1,814,455) ($1,685,368) 1 Audit Management Letter Special Revenue Funds The fund deficit is financed by loans from the following funds: $105,074 General Fund 593,069 MSA Construction 1,043,322 TIF No.3 $1,741,465 Total i� It is anticipated by management that future tax increment collections will be sufficient to repay the interfund loans. Obligations of this district decreased by$1,315,000 in 2003 as shown below: Balance Balance Bond Issue at 12/31/02 at 12/31/03 Tax Increment Bonds of 1991 $1,975,000 $1,425,000 Tax Increment Refunding Bonds of 1992 765,000 - Total $2,740,000 $1,425,000 a Audit Management Letter Special Revenue Funds TIF District No. 3 Fund (278) ' A summary of financial activity is as follows: TIF No.3 2001 2002 2003 ' Revenue and other sources: Tax increment $2,502,000 $2,067,009 $2,308,605 Investment earnings 242,268 150,386 81,399 ' Total revenue and other sources 2,744,268 2,217,395 2,390,004 Expenditures and other uses: ' Personal services - 8,945 28,010 Interest 38,445 95,881 20,000 Services and other charges 507,423 768,293 531,549 Operating transfer to Tax Increment Bonds Debt Service 580,000 570,000 548,000 ' Total expenditures and other uses 1,125,868 1,443,119 1,127,559 Increase in fund balance 1,618,400 774,276 1,262,445 Fund balance-January 1 2,464,169 4,082,569 4,856,845 Fund balance-December 31 $4,082,569 $4,856,845 $6,119,290 t I - , Audit Management Letter Special Revenue Funds Services and other charges for 2003 include the following: $333,333 Principal on Dale Tile TIF Note 126,851 Land acquisition 56,594 Professional Services 14,771 Other $531,549 Total , The obligations of this TIF District decreased by$663,333 in 2003 as shown below: ' Balance Balance Bond/Note 12/31/02 12/31/03 Taxable Tax Increment Bonds of 1995 $3,410,000 $3,080,000 Dale Tile TIF Note 333,333 - Total $3,743,333 $3,080,000 1 Audit Management Letter Special Revenue Funds TIF District No. 4 Fund 279 A summary of financial activity is as follows: TIF No.4 2001 2002 2003 Revenue and other sources: Tax increment $254,049 $139,675 $246,968 Investment earnings - 1,232 - ' Total revenue and other sources 254,049 140,907 246,968 Expenditures and other uses: ' Personal services - 4,016 3,118 Interest 104,087 Services and other charges 16,713 183,923 202,307 ' Total expenditures and other uses 120,800 187,939 205,425 Increase(decrease)in fund balance 133,249 (47,032) 41,543 Fund balance(deficit)-January 1 (20,995) 112,254 65,222 Fund balance(deficit)-December 31 $112,254 $65,222 $106,765 Services and other charges for 2003 consist primarily of Twin Lakes Business Park TIF Note repayment. The obligations of this TIF District include the following: Balance Balance 12/31/02 12/31/03 ' Twin Lake Business Park TIF Note $2,131,737 $2,113,429 Audit Management Letter Special Revenue Funds Police Drug Forfeiture Fund (205) ' The Police Drug Forfeiture Fund accounts for property and/or cash seized by the police ' department. A summary of financial activity is as follows: Police and Drug Forfeiture 2001 2002 2003 ' Revenue and other sources: Investment earnings $4,822 $2,186 $1,106 ' Forfeiture revenue 31,950 27,587 27,571 Total revenue and other sources 36,772 29,773 28,677 Expenditures and other uses: , Personal services 1,405 - - Supplies 2,360 7,936 2,009 Services and other charges 33,563 - 11,370 Total expenditures and other uses 37,328 7,936 13,379 Increase(decrease)in fund balance (556) 21,837 15,298 ' Fund balance-January 1 37,589 37,033 58,870 Fund balance-December 31 $37,033 $58,870 $74,168 Audit Management Letter Special Revenue Funds ' Community Development Block Grant Fund (204) A summary of financial activity is as follows: Community Development Block Grant Fund ' 2002 2003 Revenue and other sources: CDBG $352,000 $201,000 Expenditures and other uses: Shingle Creek tower project 325,000 175,000 Transfer to EDA(LEAP) 13,500 - CEAP 13,500 26,000 Total expenditures and other uses 352,000 201,000 Increase in fund balance $0 $0 i Audit Management Letter ' Special Revenue Funds City Initiatives Grant Fund (286) , The City Initiatives Grant Fund accounts for donations received from outside parties. A summary of financial activity is as follows: City Initiatives Grant 2001 2002 2003 Revenue and other sources: Intergovernmental $206,960 $82,157 $370,800 Investment earnings 6,300 2,289 2,532 Other 24,091 57,719 109,006 Total revenue and other sources 237,351 142,165 482,338 Expenditures and other uses: Personal services 12,611 6,219 52,347 Supplies 4,375 24,946 212,808 Services and other charges 178,169 136,845 123,836 Capital outlay 78,598 - - Interest 263 31 - Transfer to Capital Improvements Fund - 11,277 - Total expenditures and other uses 274,016 179,318 388,991 ' Increase(decrease)in fund balance (36,665) (37,153) 93,347 Fund balance-January 1 87,869 51,204 14,051 ' Fund balance-December 31 $51,204 $14,051 $107,398 i I I Audit Management Letter Debt Service Funds DEBT SERVICE FUNDS Debt Service Funds are a type of governmental fund to account for the accumulation of resources for the payment of interest and principal on debt(other than Enterprise Fund debt). Current governmental reporting standards do not provide for the matching of long-term ' debt with its related financing sources. Although this information can be found in the City's CAFR, it is located in several separate sections of the CAFR. The following schedule ' extracts information from sections of the 2003 Comprehensive Annual Financial Report to provide an overview analysis of long-term debt and its related funding. Assets Pledged for Debt Retirement 12/31/2003 Scheduled Final Fund Deferred Outstanding Property Maturity Fund Description Balance Revenue(') Totals Principal Taxes Date Tax Increment Debt: ' Tax Increment Bonds of 1991(TIF 2) $592,398 $ _ $592,398 $1,425,000 (1) 02/01/04 Refunding Tax Increment Bonds of 1992(TIF 2) 263,027 263,027 (1) 02/01/03 Taxable Tax Increment Bonds of 1995(TIF 3) 581,269 581,269 3,080,000 (1) 02/01/11 Total tax increment debt 1,436,694 0 1,436,694 4,505,000 0 Special Assessment Debt: Street Improvement Bonds of 1994(301) 178,007 11,362 189,369 185,000 69,536 02/01/05 Street Improvement Bonds of 1995(302) 119,090 22,880 141,970 260,000 144,621 02/01/06 Street Improvement Bonds of 1996(303) 464,764 139,803 604,567 620,000 359,236 02/01/07 Street Improvement Bonds of 1997(304) 243,781 253,682 497,463 510,000 - 02/01/08 Street Improvement Bonds of 1998(307) 420,390 308,435 728,825 615,000 02/01/09 Street Improvement Bonds of 1999(308) 421,874 721,175 1,143,049 1,090,000 02/01/10 Street Improvement Bonds of 2000(309) 516,839 350,895 867,734 575,000 02/01/11 Street Improvement Bonds of 2001(310) 356,881 403,542 760,423 645,000 02/01/12 ' Street Improvement Bonds of 2003(311) 255,248 890,740 1,145,988 1,205,000 02/01/13 Total special assessment debt 2,976,874 3,102,514 6,079,388 5,705,000 573,393 General Obligation Debt: Refunding State-Aid Street Bonds(306) - - - 845,000 - 04/01/06 ' Police and Fire Building Bonds(305) 907,709 30,789 938,498 5,875,000 - 02/01/13 Total general obligation debt 907,709 30,789 938,498 6,720,000 0 Total-All Debt Service Funds $5,321,277 $3,133,303 $8,454,580 $16,930,000 $573,393 ' Future tax increment amounts subject to valuation and tax capacity rate fluctuations. 2)Deferred revenue primarily consists of uncollected special assessments. i Audit Management Letter Debt Service Funds General Obligation Bonds The State-Aid Street Bonds are funded by MSA construction allotments (principal portion) and MSA maintenance allotments (interest portion). The Police and Fire Building onds are funded b an annual transfer of roe tax g Y property rtY monies from the General Fund. Beginning 2004,property tax collections will be allocated ' directly to this fund. Special Assessment Bonds The Special Assessment Improvement Bonds are funded by a combination of resources. These funding sources include special assessments and transfers from the General Fund. A summary of 2003 financial activity is as follows: 1994 1995 1996 1997 1998 1999 2000 2001 2003 , Bonds Bonds Bonds Bonds Bonds Bonds Bonds Bonds Bonds Total Revenues: Property taxes $ - $ $ $ $ $ $ $ $ $ Special assessments 11,792 15,505 81,232 101,577 109,166 282,878 130,374 125,696 294,824 1,153,044 Investment earnings 2,191 1,124 5,541 3,251 5,963 4,602 7,260 4,664 952 35,548 Transfer from other funds 66,311 72,802 119,966 259,079 Total revenues 80,294 89,431 206,739 104,828 115,129 287,480 137,634 130,360 295,776 1,447,671 Expenditures: , Principal 90,000 80,000 145,000 110,000 115,000 165,000 80,000 85,000 - 870,000 Interest 12,403 14,325 34,531 25,385 26,876 55,094 28,695 25,287 20,153 242,749 Fiscal agent fees 780 _ 2,358 1,228 2,526 720 1,211 986 1,060 3,938 14,807 Total expenditures 103,183 96683 180,759 137,911 142,596 221,305 109,681 111,347 24,091 1,127,556 Increase(decrease) $22,889 ($7,252) $25,980 $33,083 $27,467 $66,175 $27,953 $19,013 $271,685 $320,115 ' • Audit Management Letter Capital Projects Funds CAPITAL PROJECTS FUNDS The fund balances (deficits)of the Capital Projects Funds were as follows at December 31, 2002 and 2003: Fund Balance(Deficit) December 31, Increase/ Fund 2002 2003 (Decrease) Capital Reserve Emergency $1,329,490 $1,336,573 $7,083 Capital Improvements 1,760,975 1,757,730 (3,245) Municipal State Aid for Construction 620,731 430,581 (190,150) Infrastructure Construction (447,951) 229,179 677,130 Earle Brown Heritage Center Improvements 100,000 8,163 (91,837) Street Reconstruction - 283,891 283,891 Technology - 275,000 275,000 Totals $3,363,245 $4,321,117 $957,872 r r Audit Management Letter Capital Projects Funds Capital Reserve Emergency Fund (406) The Capital Reserve Emergency Fund was established to account for monies held in ' reserve for catastrophic losses or unforeseen capital items. Financial activity for the past three years is as follows: i Capital Reserve Emergency Fund 2001 2002 2003 t Revenue and other sources: Investment income $129,197 $47,174 $31,439 Expenditures and other uses: Expenditures - 58,976 24,356 Increase(decrease)in fund balance 129,197 (11,802) 7,083 Fund balance-January 1 1,212,095 1,341,292 1,329,490 , Fund balance-December 31 $1,341,292 $1,329,490 $1,336,573 This fund has provided an interfund loan to the Infrastructure Construction Fund. The amount was $709,969 at December 31, 2003. r r Audit Management Letter Capital Projects Funds Capital Improvements Fund (401) The Capital Improvements Fund was established to provide funds for major capital outlays. rFinancial activit y for o the past three years is as follows: r Capital Improvements 2001 2002 2003 Revenue and other sources: Investment income $448,395 $60,737 $13,494 Other 5,585 21,005 126,308 Residual equity transfer from General Fund 468,000 - - Transfer from General Fund 245,700 285,000 225,000 Transfer from City Initiatives Fund 11,277 Transfer from Liquor Fund 110,000 100,000 - r Transfer from Golf Course Fund 10,000 - - Transfer from Water Utility Fund 170,500 Transfer from Storm Drainage Fund 35,000 - - Total revenue 1,493,180 478,019 364,802 rExpenditures and other uses: Project costs 2,479,095 2,596,999 368,047 rIncrease(decrease)in fund balance (985,915) (2,118,980) (3,245) Fund balance-January 1 4,865,870 3,879,955 1,760,975 Fund balance-December 31 $3,879,955 $1,760,975 $1,757,730 r This fund provides an interfund loan to the Golf Course Fund. The balance of the loan was $885,000 at December 31, 2003. 1 r � r KORN on a: • • Audit Management Letter Capital Projects Funds A summary by project is as follows: I i 2003 Proj ect Expenditures Civic Center Addition(99-08) $166,552 Paint Garage North Wall(01-09) 3,024 Palmer Lake Trail(2002-18) 1,500 Shingle Creek Trail(2002-19) 1,714 Logis Upgrades 169,282 City Property Special Assessments 25,975 Total $368,047 i i r Audit Management Letter Capital Projects Funds Municipal State Aid for Construction Fund (402) The Municipal State Aid for Construction Fund was established to account for the state allotment of gasoline tax collections. Transactions for the past three years have been as follows: Municipal State Aid for Construction 2001 2002 2003 Revenue and other sources: MSA $50,000 $1,337,502 $145,387 Investment earnings 134,597 26,362 72 Otherrevenue 3,000 Total revenue and other sources 184,597 1,366,864 145,459 Expenditures and other uses: Project costs 1,096,980 1,410,361 335,609 iIncrease(decrease)in fund balance (912,383) (43,497) (190,150) Fund balance-January 1 1,576,611 664,228 620,731 Fund balance-December 31 $664,228 $620,731 $430,581 r , Audit Management Letter Capital Projects Funds Infrastructure Construction Fund (407) The Infrastructure Construction Fund was established to account for improvements financed by special assessments. The financial transactions of this fund for the past three years have been as follows: Infrastructure Construction Fund i 2001 2002 2003 Revenues and other sources: Special assessments $102,172 $260,752 $79,207 Intergovernmental - 2,487,946 332,182 Investment earnings 75,927 16,232 10,934 Other 6,823 12,843 24,554 Bond proceeds 730,000 - 1,196,140 Transfer from General Fund 409,044 555,000 480,000 Residual equity transfer from General Fund 225,000 766,343 - Total revenue and other sources 1,548,966 4,099,116 2,123,017 Expenditures and other uses: Project costs 1,800,735 5,542,084 1,445,887 Increase(decrease)in fund balance (251,769) (1,442,968) 677,130 Fund balance-January 1 1,246,786 995,017 (447,951) Fund balance(deficit)-December 31 $995,017 ($447,951) $229,179 Audit Management Letter Capital Projects Funds A summary by project is as follows: 2003 Project Expenditures River Interceptor(99-11) $30,047 Garden City Central Improvement(00-01) 6,726 Brooklyn Blvd Landscaping(00-21) 1,298 Southwest Area Improvements(02-01) 187,932 France Avenue Relocation(02-04) 197,446 Garden City South Improvement(02-05) 115,957 Shingle Creek Trail(02-19) 61,784 Happy Hollow Street Improvements(03-01) 709,591 Northport Street Improvements(03-14) 29,001 Misc. Concrete Repair(03-14) 26,002 Brooklyn Blvd Traffic Study(03-15) 9,339 Other 70,764 Total $1,445,887 Earle Brown Heritage Center Improvements Fund 408 This fund was established to account for monies set aside for future improvements. 1 Street Reconstruction Fund (409) This fund was established to account for road projects which are financed wholly or in part by special assessments. This fund was formerly the Special Assessment Construction Fund. Technology Fund (410) This fund was established in 2003 to account for funds set aside for technology improvements or major technology renovations/replacements. Audit Management Letter Enterprise Funds ENTERPRISE FUNDS The City maintains eight Enterprise Funds as follows: • Municipal Liquor • Golf Course • Earle Brown Heritage Center • Recycling and Refuse • Street Light Utility • Water Utility • Sanitary Sewer • Storm Drainage Audit Management Letter Enterprise Funds Municipal Liquor Fund The financial activity of this fund for the past three years has been as follows: Municipal Liquor 2001 2002 2003 Amount Percent Amount Percent Amount Percent Sales $3,552,152 100.0% $3,435,556 100.0% $3,407,990 100.0% Cost of sales (2,696,042) (75.9%) (2,593,765) 75.5 0%) (2,554,637) (75.0%) Gross margin 856,110 24.1% 841,791 24.5% 853,353 25.0% Operating expenses: Personal services 333,850 9.4% 364,054 10.6% 381,227 11.2% Supplies 15,096 0.4% 11,804 0.3% 25,669 0.8% Other services 89,071 2.5% 100,202 2.9% 116,784 3.4% Insurance 8,928 0.3% 7,433 0.2% 6,997 0.2% Utilities 19,146 0.5% 11,828 0.3% 12,636 0.4% Rent 140,873 4.0% 158,702 4.6% 144,499 4.2% Depreciation 36,488 1.0% 35,580 1.0% 35,580 1.0% Total operating expense 643,452 18.1% 689,603 19.9% 723,392 21.2% Operating income 212,658 6.0% 152,188 4.6% 129,961 3.8% Other income(expense)-net 60,076 1.7% 29,506 0.9% 22,072 0.6% Transfer to Capital Projects Fund (110,000) 3.1% (100,000) (2.9%) (100,000) (2.9%) Change in net assets $162,734 4.6% $81,694 2.6% $52,033 1.5% 1 Audit Management Letter Enterprise Funds The cash flow of this fund has been as follows: 2001 2002 2003 Net cash from operating activities $329 415 $247 882 $279 607 p g , Less urchase of capital assets p p (8,599) - - Subtotal 320,816 247,882 279,607 Transfer to Capital Improvements Fund (110,000) (100,000) (100,000) Investment earnings 31,727 28,169 14,956 Net increase in cash and investments $242,543 $176,051 $194,563 Cash and investment balance at December 31 $626,609 $801,993 $996,556 Comparison With Other Municipal Liquor Stores The Office of the State Auditor(OSA) annually publishes "An Analysis of Minnesota Municipal Liquor Store Operations." The most recent report available is for 2002. The following analysis compares Brooklyn Center's liquor operations with those reported in the OSA report. There are twenty-one metro area cities that operate off-sale only operations. The City of Brooklyn Center ranks tenth in sales among metro area cities. It should be noted that the following comparisons are strictly a comparison of amounts reported. There are a number of factors that affect operating results that are not included in this comparison. These factors include the mix of product sold, philosophy regarding sales techniques such as high volume/lower margin, demographics and location. Audit Management Letter Enterprise Funds Gross Margin Analysis The gross margin of the liquor operations has averaged 21% over the past five years. Gross margin measures the sales less the direct cost of products sold. A comparison to state averages for Minnesota municipal off-sale operations is as follows: Cost of Gross Margin State Sales Sales Amount Percent Average(l) 1999 $3,560,613 $2,694,622 $865,991 24.3% 23.6% 2000 3,584,829 2,734,318 850,511 23.7% 23.8% 2001 3,552,152 2,696,042 856,110 24.1% 24.0% 2002 3,435,556 2,593,765 841,791 24.5% 24.4% 2003 3,407,990 2,554,637 853,353 25.0% Not available (')Source: Minnesota Office of the State Auditor-Metropolitan Area Off-Sale Operations Operating Expenses Operating expenses for the past several years have been as follows: Percent of Sales Year Amount City State Average 1 1999 $632,638 17.7% 16.2% 2000 696,830 19.5% 16.5% 2001 643,452 18.1% 16.6% 2002 689,603 19.9% 16.2% 2003 723,392 21.2% Not available The City of Brooklyn Center does not compare favorably with State averages for operating expenses. � 1 Eel M9 a • 0 Audit Management Letter Enterprise Funds Net Income Net income for the past several years is as follows: Amount Percent of Sales State State Year City Average City Average 1999 $249,024 $142,546 6.9% 7.5% 2000 144,577 158,275 3.9% 7.7% 2001 272,734 163,125 7.7% 7.8% 2002 181,694 155,981 5.5% 8.1% 2003 152,033 N/A 4.5% N/A Golf Course Fund ' The financial activity of this fund for the past three years has been as follows: Golf Course 2001 2002 2003 Operating revenue: Sales $320,105 $278,664 $294,149 Operating expenses: Personal services 152,382 144,912 126,866 Supplies 25,620 29,219 19,501 Other services 80,082 64,203 88,494 Insurance 8,449 9,003 8,002 Utilities 14,264 13,758 17,208 Depreciation 14,736 13,045 27,912 Total expenses 295,533 274,140 287,983 Operating income $24,572 $4,524 $6,166 • Audit Management Letter Enterprise Funds The cash flow of this fund has been as follows: 2001 2002 2003 Net cash from operating 2 13 165 38 292 p 2ng actwrties $41,00 $ $ , Less purchase of capital assets (5,352) (11,161) - Less debt service (50,000) (50,000) (15,000) Subtotal (14,350) (47,996) 23,292 Investment earnings 6,569 2,606 1,048 Transfer to Capital Improvements Fund (10,000) - - Other (737) Net increase(decrease)in cash and investments ($18,518) ($45,390) $24,340 Cash and investment balance at December 31 $82,671 $37,281 $61,621 Audit Management Letter Enterprise Funds Earle Brown Heritage Center Fund The financial activity of this fund for the past three years has been as follows: Earl Brown Heritage Center 2001 2002 2003 Amount Percent Amount Percent Amount Percent Sales $3,920,676 100.0% $3,480,535 100.0% $3,393,810 100.0% Cost of sales (490,300) (12.5%) (385,341) (11.1%) (1,644,608) (48.5%) Gross margin 3,430,376 87.5% 3,095,194 88.9% 1,749,202 51.5% Operating expenses: Personal services 1,850,268 53.9% 1,740,912 56.2% 812,146 46.4% Supplies 215,874 6.3% 275,360 8.9% 90,368 5.2% Other services 527,716 15.4% 489,964 15.8% 340,303 19.5% Insurance 41,714 1.2% 34,776 1.1% 30,672 1.8% Utilities 181,830 5.3% 146,742 4.7% 157,339 9.0% Rent 85,786 2.5% 88,019 2.8% 104,776 6.0% Depreciation 416,296 111% 582,083 18.8% 571,632 32.7% Total operating expense 3,319,484 96.7% 3,357,856 108.3% 2,107,236 120.6% Operating income(loss) 110,892 (9.2%) (262,662) (19.4%) (358,034) (69.1%) Other income(expense)-net 19,851 0.6% 20,878 0.7% 11,631 0.7% Transfer to other funds - 0.0% (100,000) (3.2%) 0.0% Change in net assets $130,743 (8.6%) ($341,784) (21.9%) ($346,403) (68.4%) The cash flow of this fund has been as follows: 2001 2002 2003 Net cash from operating activities $245,281 $324,754 $171,524 Less purchase of capital assets (38,092) - - Subtotal 207,189 324,754 171,524 Investment earnings 17,907 22,553 17,376 Transfer to EBHC Improvements Fund - (100,000) - Other (1,235) (1,098) Net increase in cash and investments $223,861 $246,209 $188,900 Cash and investment balance at December 31 $420,897 $666,529 $855,429 Audit Management Letter Enterprise Funds Recycling and Refuse Fund The financial activity of this fund for the past three years has been as follows: Recycling and Refuse 2001 2002 2003 Operating revenue $211,388 $210,954 $212,271 Operating expenses: Other services 214,846 215,032 223,504 Insurance 143 179 175 Total operating expenses 214,989 215,211 223,679 Operating income(loss) ($3,601) ($4,257) ($11,408) Audit Management Letter Enterprise Funds Water Utility Fund The financial activity of this fund for the past three years has been as follows: Water Utility 2001 2002 2003 Operating revenue $1,520,950 $1,364,076 $1,530,592 Operating expenses: Depreciation 414,965 698,773 648,115 All other 958,976 873,462 991,576 Total operating expenses 1,373,941 1,572,235 1,639,691 Operating income(loss) 147,009 (208,159) (109,099) Nonoperating revenues(expenses): Income 228,755 68,864 46,717 Transfers-net (170,500) - - Total nonoperating revenues(expenses) 58,255 68,864 46,717 Change in net assets $205,264 ($139,295) ($62,382) The cash flow of this fund has been as follows: 2001 2002 2003 Net cash from operating activities $600,261 $437,240 $628,197 Less purchase of capital assets (1,048,031) (650,253) (309,930) Less debt service (56,302) (56,302) - Subtotal (504,072) (269,315) 318,267 Investment earnings 103,255 47,077 31,180 Transfer to Capital Improvements Fund (170,500) - - Net increase in cash and investments ($571,317) ($222,238) $349,447 Cash and investment balance at December 31 $1,763,546 $1,541,308 $1,890,755 Audit Management Letter Enterprise Funds Sanitary Sewer Fund The financial activity of this fund for the past three years has been as follows: Sanitary Sewer Fund 2001 2002 2003 Operating revenue $2,604,998 $2,664,730 $2,870,109 Operating expenses 2,016,942 2,550,584 2,556,224 Operating income(loss) 588,056 114,146 313,885 Nonoperating revenues(expenses): Income 133,475 42,950 77,355 Change in net assets $721,531 $157,096 $391,240 The cash flow of this fund has been as follows: 2001 2002 2003 Net cash from operating activities $612,901 $660,035 $848,185 Less purchase of capital assets (600,176) (1,023,781) (416,742) Subtotal 12,725 (363,746) 431,443 Investment earnings 59,238 42,678 26,473 Net increase in cash and investments $71,963 ($321,068) $457,916 Cash and investment balance at December 31 $1,003,252 $682,184 $1,140,100 Audit Management Letter Enterprise Funds Storm Drainage Fund The financial activity of this fund for the past three years has been as follows: Storm Drainage 2001 2002 2003 Operating revenues User fees $1,129,502 $1,377,638 $1,264,512 Special assessments 270,365 429,873 112,254 Other - - 26,363 Investment earnings 10,375 5,675 10,237 Total operating revenues 1,410,242 1,813,186 1,413,366 Operating expenses: Personal services 100,893 100,000 - Supplies - 3,153 3,861 Other services 52,613 126,656 290,369 Insurance 3,604 1,932 1,292 Utilities Depreciation 170,302 474,574 513,608 Interest 53,166 36,701 25,835 Total operating expenses 380,578 743,016 834,965 Change in net assets $1,029,664 $1,070,170 $578,401 Audit Management Letter Enterprise Funds The cash flow of this fund has been as follows: 2001 2002 2003 Net cash from operating activities $905,912 $1,126,992 $1,115,712 Less purchase of capital assets (845,165) (961,302) (323,343) Less debt service (243,166) (236,701) (235,835) Subtotal (182,419) (71,011) 556,534 Investment earnings 5,674 14,321 Special assessments 270,365 429,873 - Transfer to Capital Improvements Fund (35,000) - - Net increase in cash and investments $52,946 $364,536 $570,855 Cash and investment balance at December 31 ($21,315) $343,221 $914,076 Street Light Utility Fund This fund was established in 2003. The financial activity is as follows: Street Light Utility Fund 2002 2003 Operating revenues: User fees $213,078 $200,224 Other - 8,060 Investment earnings 966 1,035 Total operating revenues 214,044 209,319 Operating expenses: Other services 152,660 146,504 Insurance 66 789 Total operating expenses 152,726 147,293 Change in net assets $61,318 $62,026 • Audit Management Letter Internal Service Funds INTERNAL SERVICE FUNDS Internal Service Funds are used to account for the financing on a cost reimbursement basis of goods or services provided by one department to another department within the City. During 2003, the City maintained the following Internal Service Funds: Internal Service Funds Cash and Investment Balance December 31, Fund 2001 2002 2003 Compensated Absences $733,221 $741,038 $795,418 Retirement(Post Employment Insurance Benefits) 1,543,554 1,574,666 1,564,375 Central Garage 4,089,161 4,198,486 4,541,395 Total $6,365,936 $6,514,190 $6,901,188 Audit Management Letter Certificate of Excellence in Financial Reporting CERTIFICATE OF EXCELLENCE IN FINANCIAL REPORTING The City submitted the 2002 Comprehensive Annual Financial Reports (CAFR) to the Government Finance Officers Association of the United States and Canada(GFOA) for a comprehensive review. The program is a review of all facets of financial reporting for disclosure, clarity and consistency with national reporting standards. The City received the Certificate of Achievement for Excellence in Financial Reporting Award for 2002 and intends to submit the 2003 CAFR to the Certificate Program. We commend the City for this achievement. City Council Agenda Item No. 9a • MEMO To: Michael J. McCauley, City Manager From: Ronald A. Warren Planning and Zoning S eci�l � is Subject: City Council Consideration Item - Planning Commission Application No. 2004- 008 Date: June 23, 2004 On the June 28, 2004 City Council Agenda is Planning Commission Application No. 2004-008 submitted by Caribou Coffee Company, Inc. requesting a Special Use Permit to operate a Caribou Coffee Shop at 3900 Lakebreeze Avenue North Attached for your review are copies of the Planning Commission Information Sheet for Planning Commission Application No. 2004-008 and also an area map showing the location of the property under consideration, the Planning Commission minutes relating to the Commission's consideration of this matter and other supporting documents. • This matter was considered by the Planning Commission at their June 17, 2004 meeting and was recommended for approval. It is recommended that the City Council, following consideration of this matter, approve the application subject to the conditions recommended by the Planning Commission. • • Application Filed on 6-03-04 City Council Action Should Be Taken By 8-02-04 (60 Days) Planning Commission Information Sheet Application No. 2004-008 Applicant: Caribou Coffee Co, Inc. Location: 3900 Lakebreeze Ave N Request: Special Use Permit The applicant Mr. KyleWareing on behalf of Caribou Coffee Co, Inc. is seeking a special use permit to be allowed to operate a Caribou Coffee Shop at their world headquarters site, 3900 Lakebreeze Avenue North. The site includes the corporate offices,manufacturing operation and distribution center for Caribou Coffee. The property in question is zoned I-2(General Industry) and is bounded on the north by the Soo Line Railroad right of way with an Excel Energy substation on the north side of the right of way; on the east by France Avenue North and T. H. 100 right of way; on the south by Lakebreeze Avenue North with the vacant former Denny's Restaurant site and a part of Northwest Racquet Club property on the opposite side of the street; and on the west by the site of the Twin Lakes II • speculative office/industrial building housing the Toro operation as a major tenant. R A C'.KGR OT WD The City Council on June 25, 2001 approved Planning Commission Application No. 2001-012 which was a request for site and building plan approval to construct an approximate 109,000 sq. ft. speculative office/industrial building on an 8.7 acre site which was part of a three building redevelopment of a portion of the old Joslyn pole yard, the Dale Tile site, an off site parking lot for Northwest Racquet Club, and a portion of the old Davies Water Company. The site in question is legally described as Lot 2,Block 1, Joslyn Second Addition. Caribou Coffee became interested in the site and is riow in the process of occupying it as their world headquarters. The Caribou Coffee operation is considered a permitted use in the I-2 zoning district. As mentioned above,they are seeking authorization to have retail sales (coffee shop)which is otherwise not permitted in the I-2 zoning district. Section 35-331, Subdivision 3b of the City Ordinances (copy attached) allows "retail sales of products manufactured, processed or wholesaled at the use site"as a special use in this zoning district. Their proposal fits into this special use category. SPF.C'TAT,TTSF.PFRMTT STANDARDS The applicant has provided a site plan showing the building location and parking, a floor plan • showing seating for 30 customers and the location and configuration of the serving area. They 6-17-04 Page 1 • have also provided parking calculations and an analysis of their parking demand based on the inclusion of their retail store or coffee shop. The standards for special use permits contained in Section 35-220, Subdivision 2,require that the proposed special use promote and enhance the general public welfare and not be detrimental to or endanger the health and safety of the public; not be injurious to the use and enjoyment of other property in the immediate neighborhood nor substantially diminish and impair property values; not impede the normal and orderly development of surrounding property;be designed so as to minimize traffic congestion on the public streets; and conform with applicable regulations of the district in which it is located. The main issue with respect to the requested special use is whether or not sufficient parking exists to accommodate the proposal. Required parking for the existing Caribou Coffee office, manufacturing, distribution use is 269 parking spaces based on the parking formulas contained in the zoning ordinance. An additional 104 parking spaces allocated for use by the Northwest Athletic Club-is required per agreement. The owner of the property has indicated a desire to acquire the.surplus property.created by the elimination of the Denny's Restaurant on the south side of Lakebreeze Avenue in order to attach that to the Northwest Athletic Club property, thus allowing the parking encumbrance on their property to be eliminated. In their parking analysis, Caribou indicates a need for seven parking spaces based on the retail parking formula for the amount of square footage proposed for the coffee shop. Required • parking, they indicate, is 380 parking spaces. Existing parking on the site including some proof of parking on the north side-of the building is 396 potential spaces, a surplus of 16 spaces. Even if the coffee shop were required to meet the restaurant parking formula of one parking space for every two seats and two employees, the 30 seat,three employee coffee shop would require 17 parking spaces. This still would be within the existing 396 parking spaces for the site. Furthermore, Caribou notes that their parking demand in actuality would be a total of 159 parking spaces. All in all it is not anticipated that parking should be a problem even with the proposed retail space. It is also not anticipated that the proposal will create traffic congestion on the public streets at will exceed system capacity. p ty We believe the standards for special use permits are met given the information provided and we see no adverse impacts with respect to this proposal. A public hearing has been scheduled with respect to this special use permit and notices have been sent to surrounding property owners. R EC'C)MMF.NT�A TTC)N All in all we believe the application is in order and would recommend approval subject to the following: 1. The special use permit is granted for retail sales at a Caribou Coffee Shop as • 6-17-04 Page 2 • provided in the plans submitted. Any change in this use not comprehended by this application or permitted under the zoning ordinance will require re a pP royal of an amendment to this special use permit. 2. The special use permit is subject to all applicable codes, ordinances and regulations and any violation thereof shall be grounds for revocation. 3. The retail sales shall be confined to the area indicated on the site and floor plans submitted. 4. No banners,pennants, streamers,balloons or other attention attracting devices may be used in conjunction with the retail sales allowed on the site other than that which is authorized under administrative permits comprehended under the City's Zoning Ordinance. 5. This special use permit approval does not comprehend any additional signery other than that allowed under Chapter 34 of the City Ordinances. • • 6-17-04 Page 3 •� y.i.y �r•:Zti�j��__..yyll :•:r= .t.:.•ice' ...5+�i j:�v♦":.V, ^ r '. •(Jr. r• a.�• a •�•(' a �� ti h�L la. � aC � �� �� F7 ter•, � - %:�:,�::i, w'i...Z i '•.r.•-.��:' j<�' a��:.:^:�".mot..^_at :,�••� ED.3 21115 WMA l: 1 •L t. 1 1 •1 _ ' r - J T !Yj!• _ ^.i - _ •�i�:. .�:Z,.c .c , �- III1�11111, III1� l.i.. ti 1 lz lade _ ��11 • - t r: b F .�' t �'�i- 3 k �.� --..—.�.., y_..., "..",.�'r^- °.�.-^.,....,,.•� �� ar fi 5 1` c�,&T �r '._ �+�•t fir*,.`� < � � �d` �, �«� '�� �._. ,� s �n "t � 1 � ��""—rte �,.�aL } �• '�"�. � � ti a se{+� 1 :r�x„ ys t f- � �.� r n. ;r �z � r ''3`+§ '�'� ,>g.•,5� £ i ' i� .., { x�4 �. i �� .as €..t �� � 9MI, C'..s eX4 �'1-'tw - �s ' r. # yes •` 1 .+ .,+p t�'{ � ;....,;•.,..4�'4>"n:"* y j- �...-z, '^'wr a5`.`'��a4- >�rr; ^ F, y ` 5 a 6 ' as .� as x sl 'i d r ''i g '� s xaA "Sf iryy. ,"�� 9 iY ,.� t�'+ *'• ,+y'' "ap, � .R'e. 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Aaoss wAEw % UR00U TTNlsrl /2'TOOLED EDGES ;• .+!L i LLi�� , CONCRM/CURB a CU TIER ✓ SEE OEV / 24• lo• :. STANDARD DUTY BRUURNGNS w' 3' -6' PAVING SEE OCT.3/A1 r 1l l f7i_ r_ 25• ,IO'� WOE WHITE PNM STFIWNG to p• Ay '�—(- — I 17—T Nape / 16 p ]2 p 0 as ba CO;XREFE OM CUT, SEE DE C 2/AI ER--✓ na• STANDARD % TAM atuwNaus � � /� ✓ -- PAVING SEE DET.VAI ALL RADIUS Not NOTED ARE,S•-0• TOTAL PARgNO PIIOWOED � I 0 1 El El El- El FA 0 F - - k E9� a D � flv9 I r 1 I DUI L-�1� rN� OA 10 UE) e Project CARIBOU COFFEE Comm N0. 2003001-44 All CHI 1 E C 1 U R A l ALLIANCE Corporate HQ Store Date VU/04 • A1 �8 DrBW(nQ 0. 400 CLIFTON AVENUE SOUTH Store 11411 na MINNEAPOLIS,MINNESOTA SS403-3299 ScaleU . 01-1�-0* 1.01 TEL (612}871-5703 FAX 1612)671-7212 • Caribou Coffee Company, Inc. National Support Center Project 3900 Lakebreeze Avenue Parking Calculations Required Parking: Rea'd/1,000 SF SF 000's Total Corporate Office 5 30 150 Warehouse/Distribution 1.25 95 118.75 Caribou Retail Store 5.5 1.3 7.15 Northwest Athletic(by previous planning agreement) 104 Total: 380 Existing Site Parking: 3900 Lakebreeze Site 216 Toro Storage Lot @ 1.5acres (by previous planning agreement) 180 Total: 396 • Existing Site Parking(by category): Visitor/Retail Parking (indicated by yellow on plan) 22 Handicap Parking (indicated by blue on plan) 8 General Parking 186 Toro Lot General Parking(indicated by red on plan) 180 Total: 396 Actual Parking Utilization: Warehouse/Distribution Personnel 22 Corporate Office Personnel 116 Retail Store Personnel -Avg. 3 Visitor Parking (based upon current guestbook averages) 6 Retail Customer Parking (based upon projected transaction counts) 12 Total: 159 • City of Brooklyn Center Special Use Permits - Section 35-220 • 2. Standards for Special Use Permits As special cial use permit may be granted by the City Council after demonstration by evidence that all of the following are met: a. The establishment,maintenance or operation of the special use will promote and enhance the general public welfare and will not be detrimental to or endanger the public health,safety,morals or comfort. b. The special use will not be injurious to the use and enjoyment of other property in the immediate vicinity for the purposes already permitted,nor substantially diminish and impair property values within the neighborhood. c. The establishment of the special use will not impede the normal and orderly development and improvement of surrounding property for uses permitted in the district. d. Adequate measures have been or will be taken to provide ingress,egress and parking so designed as to minimize traffic congestion in the public streets. e. The special use shall,in all other respects,conform to the applicable regulations of the district in which it is located. 3. Conditions and Restrictions The Planning Commission may recommend and the City Council may impose such conditions and restrictions upon the establishment,.location,construction,.maintenance and operation of the special use as deemed necessary for the protection.of the public interest and to secure compliance with requirements specified in this ord' • mance. In all cases in which special use permits are granted,the City Council may require such evidence and guarantees as it may deem necessary as part of the conditions stipulated in connection therewith. 4. Resubmission No application for a special use permit which has been denied by the City Council shall be resubmitted for a period of twelve(12)months from the date of the final determination by the City Council;except that the applicant may set forth in writing newly discovered evidence of change of condition upon.which he relies to gain the consent of the City Council for resubmission at an earlier time. 5. Revocation and Extension of Special Use Permits When a special use permit has been issued pursuant to the provisions of this ordinance,such permit shall expire without further action by the Planning Commission or the City Council unless the applicant or his assignee or successor commences work upon the gn po subject property within one year of the date the special use permit is granted,or unless before the expiration of the one year period the applicant shall apply for an extension thereof by filling out and submitting to the Secretary of the Planning Commission a"Special Use Permit"application requesting such extension and paying an additional fee in an amount as set forth by the City Council resolution. Special use permits gran ted pursuant to the provisions of a prior ordinance of Brooklyn Center shall expire within one year of the effective date of this ordinance if construction upon the subject property pursuant to such special use permit has not commenced within that time. In any instance where an existing and established special use is abandoned for a period of one eyar,the special use permit related thereto shall expire one year following the date of abandonment. i • MINUTES OF THE PROCEEDINGS OF THE PLANNING COMMISSION OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA REGULAR SESSION JUNE 17, 2004 CALL TO ORDER The Planning Commission meeting was called to order by Chair Willson at 7:31 p.m. ROLL CALL Chair Tim Willson, Commissioners Graydon Boeck, Rex Newman, Dianne Reem, and Tim Roche were present. Also present were Secretary to the Planning Commission/Planning and Zoning Specialist Ronald Warren, and Planning Commission Recording Secretary Rebecca Crass. Sean Rahn was absent and unexcused. APPROVAL OF MINUTES —MAY 13 2004 There was a motion by Commissioner Boeck, seconded by Commissioner Newman, to approve the minutes of the January 15, 2004, meeting as submitted. The motion passed unanimously. • CHAIR'S EXPLANATION Chair Willson explained the Planning Commission's role as an advisory body. One of the Commission's functions is to hold public hearings. In the matters concerned in these hearings, the Commission makes recommendations to the City Council. The City Council makes all final decisions in these matters. APPLICATION NO. 2004-008—CARIBOU COFFEE COMPANY INC. Chair Willson introduced Application No. 2004-008, submitted by Caribou Coffee Company, Inc., a request for special use permit approval to operate a Caribou Coffee Shop at 3900 Lakebreeze Avenue North. Mr. Warren presented the staff report describing the location of the property and the proposal. (See Planning Commission Information Sheet dated 6-17-04 for Application No. 2004-008, attached.) The property is zoned I-2 (General Industry) and houses Caribou Coffee's world headquarters. Commissioner Boeck asked if the city has considered vacating the France Avenue right of way area south of the railroad tracks. Mr. Warren responded that it was his understanding that most of this area is State highway right of way related to the ongoing HWY 100 improvement project. PUBLIC HEARING—APPLICATION NO 2004-00 There was a motion by Commissioner Newman , seconded by Commissioner Reem , to open the public hearing on Application No. 2004-008, at 7:52 p.m. The motion passed unanimously. ® Chair Willson called for comments from the public. 3-25-04 Page 1 • Mr. Kyle Wareing explained that the hours of operation would be 6:00 a.m. to 8:00 .m. seven P p , days a week. This location will be a `commuter store' and he anticipates their business will come from commuters traveling to and from work along Hwy 100 and, therefore, the anticipated opening would be in line with the opening of HWY 100 sometime in August This location will offer new product lines to customers. No other persons from the public appeared before the Commission during the public hearing on Application No. 2004-006. CLOSE PUBLIC HEARING There was a motion by Commissioner Boecki seconded by Commissioner Newman, to close the public hearing on Application No. 2004-008, at 7:55 p.m. The motion passed unanimously. The Chair called for further discussion or questions from the Commissioners. The Commissioners interposed no objections to approval of the Application. ACTION TO RECOMMEND APPROVAL OF APPLICATION NO. 2004-008—CARIBOU COFFEE COMPANY INC. There was a motion by Commissioner Newman, seconded by Commissioner Boeck, to recommend to the City Council that it approve Application No. 2004-008, submitted by Caribou Coffee Company, Inc. to operate a Caribou Coffee Shop at 3900 Lakebreeze Avenue North subject to the following conditions: • 1. The special use permit is granted for retail sales at a Caribou Coffee Shop as provided in the plans submitted. Any change in this use not comprehended by this application or permitted under the zoning ordinance will require approval of an amendment to this special use permit. 2. The special use permit is subject to all applicable codes, ordinances and regulations and any violation thereof shall be grounds for revocation. 3. The retail sales shall be confined to the area indicated on the site and floor plans submitted. 4. No banners, pennants,streamers, balloons or other attention attracting devices may be used in conjunction with the retail sales allowed on the site other than that which is authorized under administrative permits comprehended under the City's Zoning Ordinance. 5. This special use permit approval does not comprehend any additional signery other than that allowed under Chapter 34 of the City Ordinances. 3-25-04 Page 2 • Voting in favor: Chair Willson, Commissioners Boeck,Newman, Reem and Roche. The motion passed unanimously. The Council will consider the application at its June 28 2004 meeting. The applicant must be present. Major changes to the application as reviewed by the Planning Commission will require that the application be returned to the Commission for reconsideration. OTHER BUSINESS The Commissioners discussed various development/redevelopment sites around the city. There was no other business. ADJOURNMENT There was a motion by Commissioner Boeck, seconded by Commissioner Roche, to adjourn the Planning Commission meeting. The motion passed unanimously. The meeting adjourned at 8:05 p.m. Chair Recorded and transcribed by: Rebecca Crass • 3-25-04 Page 3 City Council Agenda Item No. 10a I � • Member introduced the following resolution and moved its adoption: RESOLUTION NO. RESOLUTION EXPRESSING APPRECIATION FOR THE DONATION OF THE BROOKLYN CENTER LIONS CLUB IN SUPPORT OF THE EARLE BROWN DAYS YOUTH GOLF TOURNAMENT WHEREAS,the Brooklyn Center Lions Club has presented to the City a donation of two hundred dollars ($200) and has designated that it be used to support the Earle Brown Days Youth Golf Tournament; and WHEREAS, the City Council is appreciative of the donation and commends Brooklyn Center Lions Club for its civic efforts. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Brooklyn Center 1. Acknowledges the donation with gratitude. 2. Appropriates the donation to the corresponding activity budget. • June 28, 2004 Date Mayor ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon,the following voted in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. • City of Brooklyn Center A Millennium Community MEMORANDUM DATE: 6/22/04 TO: Michael J. McCauley, City Manager `+ f FROM: Jim Glasoe, Director of Community Activities, Recreation and Services SUBJECT: Resolution Expressing Appreciation For The Donation Of The Brooklyn nter Lions Club In Support Of The Earle Brown Days Youth Golf Tournament The Brooklyn Center Lions Club has presented to the City a donation of two hundred dollars ($200.00). They have designated that it be used to support the Earle Brown Days Youth Golf Tournament. Staff recommends acceptance of this donation and asks that it be coded to the corresponding • activity budget. • 6301 Shingle Creek Parkway Recreation and Community Center Phone & TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall & TDD Number(763) 569-3300 FAX(763) 569-3434 FAX(763) 569-3494 www.cityofbrooklyncenter.org • City Council Agenda Item No. 10b PROCLAMATION DECLARING ULY 11-17 J 17, 2004, TO BE • COMMUNI TYACTIVITIES, RECREATION AND SERVICES WEEK WHEREAS, community activities, recreation and services provided in our community by the Community Activities, Recreation and Services Department are an integral part of our citizens' everyday lives; and WHEREAS, the Community Activities, Recreation and Services Department provides for the maintenance and custodial functions for City-owned buildings, development and implementation of organized recreational activities, operation of the Community Center and swimming pool, and management of Centerbroolz Golf Course; and WHEREAS, recreational programs and activities and leisure experiences provide opportunities for people to live, grow, and develop into contributing members of society and experience a sense of community through fun recreational pursuits; and WHEREAS, well-maintained s including overnment buildings,g , incu ng Centerbroolz Golf Course and Community Center, maize our community attractive and a desirable place to live, work, play, and visit to contribute to our ongoing economic vitality; and WHEREAS, the knowledge, shills, and abilities of the government buildings staff promotes the health, safety, and comfort of this community by providing necessary grooming and maintenance • of our government buildings; and WHEREAS, the dedicated service and commitment of community activities, recreation and services staff touch the lives of individuals, families, groups, and the entire community which positively impacts upon the social, economic, health, and environmental quality of our community; and WHEREAS, it is highly appropriate that the services provided by the community activities, recreation and services staff be recognized and appreciated. NOW, THEREFORE, 1, AS MAYOR OF THE CITY OF BROOKLYN CENTER, State of Minnesota, with the consent and support of the Brooklyn Center City Council, do hereby proclaim the week of July 11 through 17, 2004, to be Community Activities, Recreation and Services Week in the City of Brooklyn Center and encourage all citizens to recognize the contributions that community activities, recreation and services and government buildings staff maize every day to our health, safety, comfort, and quality of life. Date Mayor • ATTEST: City Clerk City Council Agenda Item No. 10c PROCLAMATION DECLARING JULY 9 AND 10, 2004, RELAY FOR LIFE DAYS IN BROOKLYN CENTER WHEREAS, the American Cancer Society is the largest non-profit health organization in the United States and is dedicated to fighting cancer at local, State, and National levels; and WHEREAS, the American Cancer Society assists persons living with cancer through service outreach; and WHEREAS, the American Cancer Society funds research that provides treatment for cancer patients; and WHEREAS, the American Cancer Society's Relay for Life celebrates life and cancer survivorship; and WHEREAS, the Relay for Life is a community-based fund raising event to be held in Brooklyn Center with teams walking or running for 24 hours. • NOW, THEREFORE, I, AS MAYOR OF THE CITY OF BROOKLYN CENTER, State of Minnesota, with the consent and support of the Brooklyn Center City Council, do hereby proclaim July 9 and 10, 2004, as Relay for Life Days in Brooklyn Center. June 28, 2004 Date Mayor ATTEST: City Clerk • Five easy �to get involved with your Light the way Hope! , American r Society Relay For Life Your suggeste 10 donation will i. Form a team place a luminaria along the track Rel to memorialize or honor a loved 2. Attend a kickoff one who has been touched by } .• cancer. 3. Raise money Team Member: 4. Bu a luminaria In In W z mss; Y Name to be put on Honor Memory luminaria (please print) 5. Bring your family ❑ ❑ , ❑ ❑ ► �( R For additional information or to _ V make a contribution, please ❑ '' complete the following Please make checks payable td'the' +) information or contact your American Cancer society. r American Cancer Society at t 1.800.ACS.2345 and ask for the We Relay to provide hope to Relay For Life in Brooklyn those facing cancer, to celebrate Center. cancer survivorship, and to educate communities about the Please print: programs and services the ACS offers. Contact Team Recruitment Rudy For Life In Name Chair Lauri Winters at Brooklyn Center Address 763.535.2055 or lwinters@lycos.com to get July 9-10, 2004 City involved today! Brooklyn Center High School State Zip The information enclosed describes one or more of the American Cancer Society,Ines('ACS"),and the American Cancer Society,Midwest Division, c lncs(the"Division')activities. Your gift is very much appreciated and tax For more information or to Phone (w) deductible as a charitable contribution to the fullest extent allowed by law. participate, A copy of our latest financial report may be obtained by writing to the contact Phone (h) Division,3316 W.66th Street,Minneapolis,MN 55435,or the ACS,1599 Lauri Winters, 763.535.2055 or Clifton Road,NE,Atlanta,GA 30329 or by calling 1.800.ACS.2345. Email Iwinters @lycos.com T . , Return this form to: ' ` American Cancer Society RELAY RELAY Relay For Life in Brooklyn Center FOR LIFE 1.800.ACS.2345 y www.cancer.org FOR LIFE 3316 West 66th Street Minneapolis, MN 55435 _ Hope.Progress.Answers. N ©2002 American Cancer Society,Midwest Division,Inc. 0 MW603 a,. r ���f►��. .' k R .' ; � ��'! ^LR µ"6'm r ..i Il4il'ib(fr��Jplif i . One Day, One Night, One Reason We're in This Together Throughout the night and into the morning, at The first thing you notice is the campsites.It's Your American Cancer Society Relay For Life is least one member of each team will be walking. early evening and the tents are up.Streamers underway.Team members walk around a track Walking to raise money.Walking to fight cancer. flying,balloons floating,'banners waving.Colorful energetically while others take in activities for Walking to find a cure. campsites,uniquely decorated,but all with the all ages,including opportunities to learn about same theme All these people;coming together for the American Cancer Society at work in your A New Day Dawns one reason to raise funds to eliminate cancer. community. The sun rises and the teams are still walking. The fight against cancer never stops and neither There's no doubt about it. As participants pass their campsites,another will they.At the closing ceremony the final team member may take their place on the track fundraising totals are announced and there's a This is your American CanCBY or join them for a few laps.The high school football sense of great accomplishments.Survivors,care- Society Relay Fo r Life. players have formed a team and so has the church givers, neighbors and friends celebrate the suc- down the street.Merchants and business owners, cess of the event and the hope for a world with- Let's Get Started employers and employees have banded together out cancer. As the announcer gathers everyone to a central for this uniquely diverse,community event. area,you notice a group already assembled You've Come together and made a there.A woman wearing a turban holds the Lights of Hope difference. This is your victory. hand of her support group leader.A roan waves The sun sets and darkness settles. But not for to his wife and recalls the day he was diagnosed long.The luminarias are being lit and the can- This is your American Cancer with prostate cancer 15 years ago.A father pushes dles cast a soft glow around the track Each Society Relay For Life. the decorated wheelchair of his six-year-old son luminaria bears the name of a loved one.The who is battling leukemia.As Cancer survivors, crowd quiets to honor and remember those lost this group shares a common bond and it is their to cancer, those fighting cancer and those who honor to walk the first lap. have fought cancer and won. ■ City Council Agenda Item No. lOd Member introduced the following resolution and moved • its adoption: RESOLUTION NO. RESOLUTION AUTHORIZING ISSUANCE OF A COMMERCIAL KENNEL LICENSE TO GENTLE TOUCH ANIMAL SANCTUARY, 4900 FRANCE AVENUE NORTH, BROOKLYN CENTER, MINNESOTA WHEREAS, the City of Brooklyn Center has received an application for a commercial kennel license from Gentle Touch Animal Sanctuary, 4900 France Avenue North, Brooklyn Center, Minnesota; and WHEREAS, the parcel is zoned I-2 and boarding animals is an allowed use in this zoning district; and WHEREAS, an inspection was conducted on the adequacy of the kennel design and operation; and WHEREAS, the City Council of the City of Brooklyn Center did hold a public hearing to consider the issuance of a commercial kennel license to said applicant. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Brooklyn Center that the issuance of a commercial kennel license to Gentle Touch Animal Sanctuary • to operate at 4900 France Avenue North is hereby approved. June 28, 2004 Date Mayor ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. Office of the City Clerk OX City of Brooklyn Center A Millennium Community MEMORANDUM TO: Michael J. McCauley, City Man FROM: Sharon Knutson, City Clerk "AZOkk DATE: June 23, 2004 SUBJECT: Resolution Authorizing Issuance of a Commercial Kennel License to Gentle Touch Animal Sanctuary, 4900 France Avenue North, Brooklyn Center, Minnesota At its June 14, 2004, meeting, the City Council held a Public Hearing to consider the application for commercial kennel license submitted by Ms. Heather Zander for Gentle Touch Animal Sanctuary, 4900 France Avenue North. The Council tabled its decision to approve or deny the issuance of a commercial kennel license to Gentle Touch until it received more information from the applicant. The applicant was notified of the Council's decision and was asked to attend the June 28 meeting. Ms. Zander has submitted a letter that explains when the operation was established and relocated to Brooklyn Center. If the City Council wishes to approve the commercial kennel license, a resolution authorizing issuance of the license is attached for adoption. Attachment • 6301 Shingle Creek Parkway Recreation and Community Center Phone & TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall& TDD Number(763) 569-3300 FAX(763) 569-3434 FAX(763) 569-3494 www.cityolbrooklyncenter.org • June 18, 2004 Gentle Touch Animal Sanctuary 4900 France Ave No Brooklyn Center, MN 55429 Sharon Knutson, CMC City of Brooklyn Center 6301 Shingle Creek Blvd Brooklyn Center,MN 55430 Dear Sharon In response to your letter dated June 17, 2004 Gentle Touch was established in September of 2001. Our main address for operation was 3734 Oliver Ave No in North Mpls. It was run as a home based operation and was foster based until our animals could be placed into two of the Petsmart locations. After checking with the City of Brooklyn Center to make sure that the 4900 France Ave location was zoned correctly for what the organization proposed to do we decided to rent • the lower portion of 4900 France Ave in March of 2004. Since this parcel of land is totally animal related we felt this was the perfect location for our organization to set up business. If you need additional information please feel free to contact at 612-521-2200. Sincerely, Heather Zander Vice President Gentle Touch Animal Sanctuary Office of the City Clerk City of Brooklyn Center A Millennium Community Sharon Knutson • City Clerk June 17, 2004 Ms. Heather Zander Gentle Touch Animal Sanctuary 4900 France Avenue North Brooklyn Center, MN 55429 Dear Ms. Zander: At its June 14, 2004, meeting, the Brooklyn Center City Council held a Public Hearing to review your commercial kennel license application. Following Council discussion, the Council tabled approval of your commercial kennel license to its June 28, 2004, meeting, as the Council had several questions regarding the operation and number of animals to be kept. If you could lease submit to the City a brief P Y p Y letter that explains when Gentle Touch began its operation and where it was located and also when the operation began in Brooklyn Center at the current location. The license application is dated March 23, 2004. Attached is a copy of an excerpt of the draft City Council minutes from the June 14 meeting. The City Council will meet in the City Hall Council Chambers, 6301 Shingle Creek Parkway, Brooklyn Center, at 7:00 p.m. on Monday, June 28, 2004, to discuss your commercial kennel license application. It is recommended that you attend the meeting to answer questions the Council may have regarding the operation. Should you have questions or need further information, please call me at 763-569-3306. Sincerely, Sharon Knutson, CMC City Clerk Enclosure 6301 Shingle Creek Parkway Recreation and Community Center Phone & TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall & TDD Number (763) 569-3300 FAX(763) 569-3434 FAX(763) 569-3494 www.cityofbrooklyncenter.org The following materials were included in the June 14, 2004, City Council • Agenda Packet • Office of the City Clerk OrCity of Brooklyn Center A Millennium Community MEMORANDUM TO: Michael J. McCauley,City Ma er FROM: Sharon Knutson, City Clerk DATE: June 9, 2004 SUBJECT: Public Hearing: Consideration of Application for Commercial Kennel License Submitted by Gentle Touch Animal Sanctuary, 4900 France Avenue North, Brooklyn Center, Minnesota Resolution Authorizing Issuance of a Commercial Kennel License to Gentle Touch Animal Sanctuary, 4900 France Avenue North; Brooklyn Center, Minnesota The City of Brooklyn Center has received an application for a commercial kennel license from Gentle Touch Animal Sanctuary, 4900 France Avenue North, Brooklyn Center, Minnesota. Section 1-104.1.b. of the City Code requires that the application be referred to the public health sanitarian who shall review the kennel design and operation and make a recommendation to the City Council on the adequacy thereof. Building Inspector Ed Lovelace conducted a life safety/health and comfort inspection, and the report from Building Official Larry Martin is attached for City Council review. Mr. Martin has indicated that the four items that were found not in compliance with City Codes were not life safety • issues, but minor building code violations (emergency light not working and a switch cover plate) and a compliance order was issued to correct the items. Section 1-104.1.b. of the City Code also requires that the City Council hold a public hearing regarding the commercial kennel license application and that notice of the hearing be mailed to the applicant and to the owners of property within 150 feet of the proposed kennel location. Notices were mailed to properties within 150 feet of the proposed kennel location. The proposed kennel location abuts businesses and no residential dwellings. Section 1-104.1.c. of the City Code regarding Council Approval reads as follows: 1-104.1.c. _Council Approval. The City Council may approve the commercial kennel license and may attach to such approval any conditions necessary to insure compliance with this ordinance, with Chapter 19 of City Ordinances, and any other condition necessary to protect the health, safety, welfare, and property values in the immediate area. The City Council may deny a commercial kennel license upon finding that the establishment of the kennel would constitute a public nuisance, or would adversely affect the health, safety, welfare or property values of the person residing, living, or owning property within the immediate area. The form of approval for a license shall be the resolution of approval, a certified copy of which shall be forwarded to the applicant. If the City Council wishes to approve the commercial kennel license, a resolution authorizing issuance of the license is attached for adoption. 6301 Shingle Creek Parkway Recreation and Community Center Phone & TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall & TDD Number (763) 569-3300 FAX(763) 569-3434 FAX(763) 569-3494 www.cityofbrooklyncenter.org MEMORANDUM From: Larry Martin, Building Official To: Sharon Knutson, City Clerk Date: June 8, 2004 Subject: Commercial Kennel inspections at 4900 France Ave. N. On May 26, 2004, Ed Lovelace conducted a life safety/health and comfort inspection in the following businesses located at 4900 France Ave. N. 1. Pandora's Box Veterinary Clinic 2. Brooklyn Pet Hospital 3. The Cutting Edge 4. Gentle Touch Animal Sanctuary Four items were found not to be in compliance with City codes/ordinances. A Building Compliance order was sent to Gentle Touch Animal Sanctuary to correct the deficiencies. • • City of Brooklyn Center 6301 Shingle Creek Pkwy 55430-2199 (763) 569-3300 License Application ?� 4 Annual Fee: rM Commercial Kennel Prorated Fee: Annual Expiration: September 30 TO THE HONORABLE CITY COUNCIL: Date: 2 3 2004 OPERATOR l��t� Company Name: C� LZ OCR Address: L19C'6 6 (6 no r� ,ice f��y.�--- k n�,n. 5!5 L!g2 " / /� (Street Address, City, State, and Zip) Telephone Number:_ 6 1 a OWNER(APPLICANT) Company Name: �,�-{p. �C�YL, ,L�r�rnr, .! s, , 7 r, • Address: L?9� (Street Address, City, State, and Zip) Telephone Number: G f Q - 2(—)DM e The undersigned hereby applies for a commercial kennel license and acknowledges receipt of a copy of City Ordinance Sections 1-101 through 1-120 and agrees to comply at all times with all laws, ordinances, or regulations applicable whether they be federal, state, county, or municipal. Submitted with this application is a sketch or drawing of the proposed kennel describing construction, operation, and the approximate number of animals to be confined therein, proof of workers'compensation insurance coverage,and Minnesota business tax identification number. Information is collected to determine eligibility for license. Failure to provide information requested may result in denial of application. -Zcn a,6- ,being first duly sworn,upon his/her oath deposes and says that he/she is the person who has executed the foregoing application and that the statements made therein are true of his/her own knowledge and belief. Signature of Applicant , O� e--d , Subscribed and s nj� ore me this `IJ day of Notary Public • County n P,P 1 i7 My Commission expires Q _ DENISE PERTEET Notary Public Minnesota My Commission Expires Jan.31,2005 City of Brooklyn Center MINNESOTA BUSINESS TAX IDENTIFICATION NUMBER Pursuant to Minnesota Statute 270.72 Tax Clearance;Issuance of Licenses,the City of Brooklyn Center is • required to provide to the Minnesota Commissioner of Revenue your Minnesota business tax identification number and the social security number of each license applicant. Under the Minnesota Government Data Practices Act and the Federal Privacy Act of 1974,we are required to advise you of the following regarding the use of this information: 1. This information may be used to deny the issuance,renewal,or transfer of your license in the event you owe the Minnesota Department of Revenue delinquent taxes,penalties, or interest; 2. Upon receiving this information,the licensing authority will supply it only to the Minnesota Department of Revenue. However, under the Federal Exchange of Information Agreement, the Department of Revenue may supply this information to the Internal Revenue Service; 3. Failure to supply this information may;eopardize or delay the processing of your licensing issuance or renewal application. Please supply the following information and return along with your application to the City of Brooklyn Center. DO NOT RETURN TO THE DEPARTMENT OF REVENUE. X License being applied for or renewed: t!om,,,n gC La l �� nngL X License renewal date: q -3 o'o X* PERSONAL INFORMATION (if applicable*)Please Print: • Applicant's Name: ��� '- - 2 G r r tr Applicant's Address: r. n /3 b--h -9 �9l n , !g,ss, y313Lt Ole( c�re StMan v Social Security Number: Ll �-) - 5(0-- 205 L X* BUSINESS INFORMATION (if applicable*)Please Print: Business Name: A,:,,a,,n_f "Dan CIUC,Ci 4 Contact Person:_ 0�,,�I_���n�JAy2 Business Address: 6,t-_ n (Address, City, State, and Zip) If a Minnesota Tax Identification Number is not required, please explain on the reverse side. X Federal Tax Identification Number: ! -j J �j { X Minnesota Tax Identification Number:_ Lf Signature Posit—ion (Officer,-Partner, etc.) Date City of Brooklyn Center PROOF OF WORKERS' COMPENSATION INSURANCE COVERAGE • Minnesota Statute Section 176.182 requires every very state and local licensing agency to withhold the issuance or renewal of a license or permit to operate a business in-Minnesota until the applicant presents acceptable evidence of compliance with the workers' compensation insurance coverage requirement of Section 176.181, Subd. 2. The information required is: The name of the insurance company, the policy number, and dates of coverage or the permit to self-insure. This information will be collected by the licensing agency and put in their company file. It will be furnished,upon request, to the Department of Labor and Industry to check for compliance with Minnesota Statute Section 176.181, Subd. 2. This information is required by law,and licenses and permits to operate a business may not be issued or renewed if it is not provided and/or is falsely reported. Furthermore, if this information is not provided and/or falsely reported,it may result in a$1,000 penalty assessed against the applicant by the Commissioner of the Department of Labor and Industry payable to the Special Compensation Fund. Provide the information specified above in the spaces provided, or certify the precise reason your business is excluded from compliance with the insurance coverage requirement for workers' compensation. X Insurance Company Name: • (NOT the insurance agent) X Policy Number or Self-Insurance Permit Number: X Dates of Coverage: (OR) I am not required to have workers' compensation liability coverage because: X ( � ) I have no employees covered by the law. X ( ) Other(Specify) I have read and understand my rights and obligations with regards to business licenses,permits,and workers' compensation coverage, and I certify that the information provided is true and correct. X Business Name: In x,h) 4 Srrr.► X Contact Person(please print): �A,Q n, j2 a I- `Z p Air, • X (Signature) e J (Date) • March 16, 2004 To: City of Brooklyn Center From: Gentle Touch Animal Sanctuary Re: Commercial Kennel License Address: 4900 France Ave No, Brooklyn Center, MN Gentle Touch is a non-profit (501) animal rescue organization. Our intent is to house mainly rescued cats until we can place them into foster homes, Petsmart Luv A Pet Centers, or adopt them out. Gentle Touch may on occasion house dogs or puppies until placed. The number of animals will vary along with sex and age. The animals will not be kept on a long term basis. Our facility could sufficiently house up to 20 cats some of which may come with litters. The main areas in which the cats will be kept consist of an Isolation Room holding 7 cages and 2 Kitty Condo Rooms. Cats, if social may roam the facility while staffed and caged when not. • Our intent is to run the rescue as a home-style living environment for the animals until they can be placed into the various above mentioned situations which will help them not only during the transition period but will also help them adjust well to their new permanent homes once adopted. Gentle Touch has been in operation for 2 1/2 years and has been operating as a foster based organization. We have no paid staff and run the organization with the help of volunteers. Animals taken in by Gentle Touch are vet checked, sterilized, given distemper vaccines, de-wormed,treated with Frontline/Revolution, are microchiped, and will be given rabies vaccinations. Our Vet is located within 50 feet of the proposed building which would be convenient for animals needing medical attention. • • April 5, 2004 Heather Zander Gentle Touch Animal Sanctuary 4900 France Ave No Brooklyn Center, MN 55429 Maria Rosenbaum Deputy City Clerk City of Brooklyn Center89 6301 Shingle Creek Parkway Brooklyn Center, MN 55430 Dear Maria I have enclosed a sketch of the facility. The walls are finished painted walls and the cages we will be using are metal cages with metal bottoms. Since the majority of the animals in which will be housed at the facility will be cats in cages the cages can be conveniently cleaned. We are for the most part, a cat only facility any dogs or puppies that we take in will be housed and kenneled at our Vet's office which is approx 20 feet from our facility until they are placed for adoption. We do not ptj�jpgje making any structural changes 1p the building. I hope this satisfies your requirements, if not, please ftpp Fp1114ct me at 612-521- 2200. Thank you for your assistance in this matter. Sincerely, 4 Heather Zander Gentle Touch Animal Sanctuary • ��,� G C Ck_� ���« ���� ��� � � a�-�.Y, .,.�,.� l� � -�'`` � Ra��-v-, v -���,� � � .� s�� � �� � r v v � • May 21, 2004 NOTICE OF PUBLIC HEARING Monday, June 14, 2004 City Hall Council Chambers 6301 Shingle Creek Parkway Brooklyn Center, Minnesota 7:00 p.m. (or as soon thereafter as the matter may be heard) City Ordinance Section 1-104, l.b. requires that owners of property within 150 feet of the proposed kennel location be notified of the public hearing. • NOTICE IS HEREBY GIVEN that the City Council of the City of Brooklyn Center will hold a public hearing on Monday, June 14, 2004, at 7 p.m. or as soon thereafter as the matter may be heard in the City Hall Council Chambers, 6301 Shingle Creek Parkway, to consider an application for commercial kennel license submitted by Heather Zander, Gentle Touch Animal Sanctuary, 4900 France Avenue North, Brooklyn Center, Minnesota, Hennepin County. BRIEF STATEMENT OF CONTENTS: Gentle Touch Animal Sanctuary is a non-profit (501) animal rescue organization. The intent is to house mainly rescued cats until they can be placed into foster homes, Petsmart Luv A Pet Centers, or adopt them out. Gentle Touch may on occasion house dogs or puppies until placed. Sharon Knutson City Clerk • • Z 5019 m 5018 m m Z 5019 Z 5006 D m 5013 5012 5013 e 3800 Z 0 00 5001 3614 5001 0 p O NTH AVE N � 50TH AVE N 50TH AVE N 0 ^oo ,moo 3721 3715 3707 3701 3615 3607 4911 ��O - 4 G vwP 4925 © 4919 • 4906 \ � 4913 4907 • Z 4901 w w Z 3355 Q 3900 LL 3349 \�\ 22 00 89 0�\ P �O 4810 G� v newspapers AFFIDAVIT OF PUBLICATION City of Brooklyn Center _ STATE OF MINNESOTA) (Ofricial Publication)- . CITY OF BROOKLYN CENTER ss. NOTICE OF PUBLIC HEARING COUNTY OF HENNEPIN) TO WHOM IT MAY CONCERN: NOTICE IS HEREBY GIVEN that the City Council of the City of Brooklyn Center will hold'a public hearing on Mon- Richard Hendrickson, being duly sworn on an oath states or affirms, that he is the Chief day,June 14,2004,at 7 p.m.or as soon thereafter as the Financial Officer of the newspaper known as Sun-Post matter may be heard in the City Hall Council Chambers, and 6301 Shingle Creek Parkway,to consider an application for commercial kennel_license submitted:by;Heather Zander, has full knowledge of the facts stated below: Gentle Touch Animal,Sanctuary,4900 France Avenue North,Brooklyn Center,Minnesota,Hennepin County. (A)The newspaper has complied with all of the requirements constituting qualification as Sharon Knutson City Clerk a qualified newspaper, as provided by Minn. Stat. §331A.02, §331A.07, and other (Published in the May 27,2004,Brooklyn Center sun-Pour) applicable laws, as amended. (May 27,2004)Pl/Commercial Kennel Lic PH (B)The printed public notice that is attached was published in the newspaper once each week,for one successive week(s);it was first published on Thursday,the 27 day of May , 2004, and was thereafter printed and published on every Thursday to and including Thursday, the day of , 2004; and printed below is a copy of the lower case alphabet from A to Z, both inclusive, which is hereby acknowledged as being the size and kind of type used in the composition and publica- tion of the notice: abcdefghijklmnopgrstuvwxyz BY: CFO Subscribed and sworn to or affirmed before me on this 27th day of May 2004. Notary Pu lic /P MARY ANN CARLSON NOTARY PUBLIC—MINNESOTA MY COMMISSION EXPIRES 131.09 RATE INFORMATION (1) Lowest classified rate paid by commercial users $ 2.85 per line for comparable space isMaximum rate allowed by law $ 6.20 per line (3) Rate actually charged $ 1.40 per line City Council Agenda Item No. 10e Member introduced the following resolution and moved its • adoption: RESOLUTION NO. RESOLUTION AUTHORIZING ACCEPTANCE OF A DONATED GLOBAL POSITIONING SYSTEM TO THE BROOKLYN CENTER POLICE DEPARTMENT WHEREAS, on June 12, 2004, a Global Positioning System (GPS) was donated to the Brooklyn Center Police Department by Mr. Douglas Schultz at a Neighborhood Block Watch Party; and WHEREAS, the GPS unit is to be utilized to assist the Brooklyn Center Police Department with tracking and apprehending auto thieves. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Brooklyn Center that the GPS unit is hereby accepted on behalf of the City of Brooklyn Center. BE IT FURTHER RESOLVED that the City Manager is hereby directed to transfer this unit to the Police Department. • June 28, 2004 Date Mayor ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. • ��pOKLYN CEtylF9 BROOKLYN CENTER POLICE DEPARTMENT POLICE MEMORANDUM TO: City Manager Michael McCauley FROM: Scott Bechthold, Chief of Police DATE: June 18, 2004 SUBJECT: Donation of a GPS Unit to the Police Department Enclosed please find a Resolution accepting the recent donation of a Global Positioning System (GPS). On June 12, 2004, Mr. Douglas Schultz donated this unit to the Brooklyn Center Police • Department at a Neighborhood Block party. He purchased this unit at cost($400.00) from Northland GPS. This unit will assist the police department in its effort of reducing auto theft. It will be strategically placed in a"bait"vehicle, in an area with the highest potential for auto theft. The donating block group felt this tool would assist us in our effort toward significantly decreasing theft of vehicles. SB/ed • • City Council Agenda Item No. 10f Member introduced the following resolution and moved its • adoption: RESOLUTION NO. RESOLUTION AUTHORIZING PARTICIPATION IN TOBACCO-FREE YOUTH RECREATION PROGRAM INITIATIVE WHEREAS, the Tobacco-Free Youth Recreation Program initiative has offered to provide signs for use in City parks to post areas as"no smoking"during organized youth activities; and WHEREAS, encouraging tobacco-free areas around organized youth activities would promote better and healthier environments for youth in City parks; and WHEREAS, it is proposed that the City place donated tobacco-free zone signs that would encourage tobacco-free areas around organized youth activities in Brooklyn Center parks. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Brooklyn Center that the acceptance of tobacco-free area signs from the Tobacco-Free Youth Recreation Program Initiative be and hereby is authorized and be it further authorized that the placement of such signs in City parks be undertaken in an effort to encourage smoke-free areas in the • vicinity of organized youth activities in City parks. June 28, 2004 Date Mayor ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon,the following voted in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. City Council Agenda Item No. lOg ��ppKLYN CEIyrF9 BROOKLYN CENTER POLICE DEPARTMENT POLICE MEMORANDUM TO: Michael McCauley FROM: Scott Bechthold, Chief of Police SUBJECT: 2004 Summer Sweep— 1"Report DATE: July 22, 2004 Current Status of Sweep: As of June 18, 2004, first inspections of residential homes are complete and second inspections are underway. Second inspections for some violations will continue into July and August due to extensions and compliance timelines. First inspections of apartment properties should be on track to start on July I"and will be completed by July 15h, at which time first inspections of • commercial properties will begin. First inspections for all property types should be complete by the end of July. Number of Violation(s) by Type: Garbage Storage/Removal 52 Parts/Engines &Related Items 10 Accum/of Rubbish/Brush/Debris 114 Accum. Of Junk/Furniture/Appli. 91 Illegal parking/Storage of Vehicles 69 Unlicensed/Inoperable Vehicles 131 Yard Maintenance (Seed& sod) 26 Proper Addressing 11 Miscellaneous (14 Days) 2 Fences 16 Accessory Buildings 64 Windows/Doors/Screens 16 Stairs/Porches/Decks 7 Driving/Parking Area Repairs 27 Foundations/Ext Walls/Roofs 38 Miscellaneous (30 Days) 0 • Summer Sweep– 1St Report Page 2 • Total Number of Violations: 682 Breakdown of letters sent: First Letters: 535 Second Letters 71 Compliance/Thanks You 216 Citation/Formal Complaints 0 Staffing: As of the date of this report, we are working with one full time NLO and a full-time CSO to assist with inspections due to the loss of NLO Koncar. We are in the process of hiring a replacement for Matt Koncar. We are confident that the sweep will be completed by the end of summer's deadline. Training of the CSO to enter data through the PIM's record system has been completed. This will help maintain the timeline concerns through the hiring process of a new NLO. • Extension/Work in Progress: 5327 Colfax—garage—will be re-sided—re-inspect 6/30/04 5553 Emerson-garage-re-painting---re-inspect 8/09/04 6261 Brooklyn Dr—lean-to removal—re-inspect 7/01/04 5320 Penn—remodeling-re-inspect 8/31/04 3708 66t� remodeling-re-inspect 7/05/04 6030 Camden—fence—replacing-7/26/04 6100 Lee—garage—painting-8/02/04 6925 Palmer Lake Dr—re-landscaping-re-inspect 7/14/04 5319 Knox—garage—painting—re-inspect 7/26/04 6219 Dupont—house painting—re-inspect 8/26/04 6400 Fremont—garage-painting—re-inspect 7/14/04 6900 Morgan—removing pool in backyard, roof replacement late summer. Those who have hired contractors are behind due to weather conditions. Tickets/Knock& Talks: 6900 Oliver—has not finished siding 5840 Dupont—vehicle will be tagged 2101 71St—shed to be sided—has not finished • 7218 Girard—paint garage—has not completed 5332 James—auto repair (?) 5650 Fremont—will be cited for illegal parking of vehicles 5559 Lyndale—will be cited for vehicles/junk on property Summer Sweep— 1St Report Page 3 • Houses on track for citations/complaint with three or more violations: We will report on this category in the next report. We would like to note the property located at 5025 Ewing has been condemned after a search warrant was executed at that address on June 16th, based on code violations. Currently, this property has been boarded up by the City pending further action. Comments At the start of the Summer Sweep,NLO staff received numerous calls/complaints regarding long grass/weed issues. We did follow-up on each call and turned over addresses in violation to engineering. Also, during the Sweep we have found 21 single-family homes that were renting without a license. All the information was provided to Community Development to insure proper licensing. • • • I _City Council Agenda Item No. loh Member introduced the following resolution and moved its • adoption: RESOLUTION NO. RESOLUTION PROVIDING FOR THE TRANSFER OF TITLE OF FORMER HUMBOLDT LIQUOR STORE TO SCHOOL DISTRICT NO. 286 WHEREAS, the City is the owner of certain real property in the City legally described as Lot 2,Block 1,Horbal Addition(the"Subject Property"); and WHEREAS, the City has previously executed a lease and purchase agreement with Independent School District No. 286 (hereinafter the "Lease Purchase Agreement"), under which the School District leased the Subject Property until June 30, 2004, at which time the City agreed to convey the property to Independent School District No. 286; and WHEREAS, Independent School District No. 286 has performed all of its obligations under the Lease Purchase Agreement. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Brooklyn Center that the Mayor and City Manager be and hereby are authorized to take all steps necessary to effect the transfer and sale of the Subject Property to Independent School District No. 286 in accordance with the Lease Purchase Agreement. • June 28, 2004 Date Mayor ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon,the following voted in favor thereof. and the following voted against the same: whereupon said resolution was declared duly passed and adopted. • City of Brooklyn Center A Millennium Community MEMORANDUM TO: Mayor Kra ness, C?1IInzcilmembe C od Y� Lasman Niesen and Pe pp e FROM: Michael J. McCauley DATE: June 23, 2004 SUBJECT: Transfer of Title to Hu oldt Liquor Store Property District No. 286 and the City entered into a lease purchase agreement for the transfer and sale of the former liquor store at Humboldt and 69"'Avenue. The School District has performed its obligations under that agreement and the City is required to transfer title to the property under that agreement. The resolution will confirm that completion of obligations. A copy of the lease agreement is attached for your reference. • I • 6301 Shingle Creek Parkway Recreation and Community Center Phone & TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall & TDD Number (763) 569-3300 FAX(763) 569-3434 FAX(763) 569-3494 www.cityolbrooklyncenter.org • LEASE AGREEMENT This Lease Agreement, made this C-u I '1day of , 2000, between THE CITY OF BROOKLYN CENTER (hereinafter called "Landlord") and INDEPENDENT SCHOOL DISTRICT NO. 286, BROOKLYN CENTER (hereinafter "Tenant")- WITNESSETH FOR AND IN CONSIDERATION of the sum of One Dollar ($1.00) in hand paid by each of the parties to the other, and other good and valuable consideration, receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: ARTICLE 1: PREMISES Landlord hereby leases to Tenant and Tenant hereby rents from Landlord, subject to and with benefit of the terms, covenants, conditions and provisions of this Lease, the property described in Exhibit A, including all improvements located thereon. ARTICLE 2: LANDLORD WARRANTIES • Landlord hereby warrants that it and no other person or corporation has the right to lease the Premises hereby demised. So long as Tenant shall perform each and every covenant to be performed by Tenant hereunder, Tenant shall have peaceful and quite use and possession of the Premises without hindrance on the part of Landlord, and Landlord shall warrant and defend Tenant in such peaceful and quiet use and,possession under Landlord. ARTICLE 3: TERM This Lease shall be for a Four Year Term beginning on / O�t, L000 and ending on J� y� 3d f� 2004. — ARTICLE 4: IMPROVEMENT OF THE PREMISES A. Performance of Work. Tenant shall have the right to improve the Property and Buildings located thereon, consistent with the Tenant's use of the Property for educational purposes. Tenant agrees that the improvement work shall be done in a good and workmanlike manner employing good materials and so as to conform to all building codes and regulations. Landlord allocates $205,000 of the total term rent which may be utilized by • Tenant for improvements to the Leased Premises. Any improvement costs in excess of$205,000 shall be the responsibility of Tenant. • B. Landlord Improvements. The parties contemplate that the Premises are to be improved for Tenant's intended use. Landlord authorizes Tenant to undertake the design and improvement work. Tenant shall be solely responsible for payment for the improvement work, which cost shall reduce the rental payment to Landlord as described herein. ARTICLE 5: RENT Tenant covenants and agrees to pay to Landlord, at the address set out in the heading of this Lease, or at such other places as Landlord may designate in writing to Tenant, rental at the following rates and times: A. Annual Minimum Rent. Subject to the rental payment deduction for improvement work as described in Article 4 hereof, Tenant shall pay $110,000 annually during the Term of this Lease, which sum shall be payable in two (2) biannual installments, on or before the first day of July and December, in advance. ARTICLE 6: UTILITY SERVICES • A. Gas, Electricity, Water and Sewer. Landlord agrees to cause mains, conduits and other facilities to be provided which are capable of supplying gas, electricity, water and sewer service to the Premises or to nearby places. Tenant shall pay for all gas, electricity, water and sewer service used in the Premises. ARTICLE 7: INSURANCE A. Tenant's Insurance. (1) Liability Insurance. During the Term hereof, Tenant shall keep in full force and effect,at its expense, a policy or policies of public liability insurance with respect to the Premises and the business of Tenant and any approved subtenant, licensee, or concessionaire, with limits of liability equal to the limit of liability imposed by Minn. Stat. §466.04. Tenant shall furnish Landlord with certificates evidencing that such insurance is in effect. (ii) Workers' Compensation. The Tenant shall keep in force, at its expense, Workers' Compensation or similar insurance affordin g statutory coverage e and containing statutory limits. At the written request of Landlord, Tenant agrees to furnish to Landlord evidence of Workers' Compensation coverage. • 2 (iii) During the Term hereof, Tenant agrees to carry, at its expense, insurance • for fire and Extended Coverage, insuring for the full insurable value of Tenant's merchandise, trade fixtures, furnishings, operating equipment, and personal property, including wall coverings, carpeting and drapes. B. Landlord's Insurance. Landlord agrees to carry during the Term hereof insurance for fire and Extended Coverage, insuring the improvements located upon the Premises including the Premises and all appurtenances thereof(except Tenant's merchandise, fixtures, furnishings, operating equipment and personal property) for the full insurable value thereof. Deductibles for all Landlord's insurance required herein shall be commercially reasonable. The Tenant agrees to reimburse the Landlord for the cost of providing such insurance. C. Release. Anything in this Lease to the contrary notwithstanding it is agreed that each party (the "Releasing Party") hereby releases the other (the "Released Party") from liability which the Released Party would, but for this Article, have had to the Releasing Party during the Term of this Lease, resulting from the occurrence of any accident or • occurrence or casualty (1) which is actually covered by a fire and extended coverage policy (with a vandalism and malicious mischief endorsement attached) or by a sprinkler . leakage, boiler and machinery or water damage policy in the State of Minnesota, or (2) which is actually covered by any other insurance being carried by the Releasing Party at the time of such occurrence. This mutual release shall only be operative to the extent it does not compromise any of the referenced insurance policies and coverages and protections afforded thereunder. D. Liability. Landlord shall be free from liability and claims for damages by reason of injuries occurring on or after the date of this Lease Agreement to any person or persons or property while on or about the Premises. Tenant shall, to the extent permitted by law, defend and indemnify Landlord from all liability, loss, costs and obligations including reasonable attorneys' fees on account of or arising out of any such injuries. However, Tenant shall have no liability or obligation to Landlord for such injuries which are caused by the negligence or intentional wrongful acts or omissions of Landlord or Landlord's agents or employees. Nothing herein shall be deemed a waiver by either party of the limitations on liability set forth in Minnesota Statutes, Chapter 466. • 3 ARTICLE 8: EMINENT DOMAIN • In the event the whole or any part of the Premises shall be taken by eminent domain, the Tenant shall be entitled to all awards made as a result of the taking, and the obligation of Tenant to pay lease payments shall continue. ARTICLE 9: DAMAGE TO PROPERTY In the event the Premises are damaged by fire, or other casualty insured under the coverage which Landlord is required to provide, Landlord shall transmit all improvement proceeds to Tenant, and Tenant's obligation to pay rent shall continue. ARTICLE 10: TERMINATION OF LEASE Tenant shall have the right to terminate this Lease at the end of any fiscal year during the Lease term. At the end of the Lease Term, provided the Lease has not been earlier terminated by Tenant, the Landlord shall take such action as is necessary to transfer the fee interest in the Property to the Tenant by Warranty Deed, unless the Tenant has given written notice to the Landlord to the contrary. Title to the property shall be subject to all building and zoning laws, ordinances, state and federal regulations; reservation of mineral rights to the State of Minnesota, if any; restrictions affecting the • use or improvement to the property without effective forfeiture provisions; and all easements and other interests of record. The Tenant will provide written notice to the Landlord no less than 30 days prior to the termination of this lease, if the fee interest in the Property is not to transfer to the Tenant. In such case, the fee interest in the Property shall remain with the Landlord. ARTICLE 11: CAPTIONS The captions and headings herein are for convenience and reference only. ARTICLE 12: APPLICABLE LAW This Lease shall be construed under the laws of the State of Minnesota. If any provision of this Lease, or portion thereof, or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Lease shall not be affected thereby and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by law. • 4 • ARTICLE 13: SUCCESSORS This Lease and the covenants and conditions herein contained shall inure to the benefit and be binding upon Landlord, its successors and assigns, and shall be binding upon Tenant, its successors and assigns, and shall inure to the benefit of Tenant and only such assigns of Tenant to whom the assignment by Tenant has been consented to by Landlord. ARTICLE 14: BROKERS Each of the parties represents and warrants that there are no claims for brokerage commission or finder's fees in connection with the execution of this Lease. ARTICLE 15: NO PARTNERSHIP Any intention to create a joint venture, partnership or agency relation between the parties hereto is hereby expressly disclaimed. ARTICLE 16: AMENDMENTS IN WRITING This Lease and the Exhibits attached hereto and forming a part hereof, set forth all • the covenants, promises, agreements, conditions and understandings between Landlord and Tenant concerning the demised Premises and there are no covenants, promises, agreements, conditions or understandings, either oral or written, between them other than are herein set forth. Except as herein otherwise provided, no subsequent alteration, amendment, change or addition to this Lease shall be binding upon Landlord or Tenant unless reduced to writing and signed by them. ARTICLE 17: AUTHORITY Tenant and Landlord warrant and represent to each other that their execution of this Lease is pursuant to a resolution of the Boards of the parties. ARTICLE 18: TAXES AND ASSESSMENTS Tenant shall be responsible for the payment of all taxes and assessments or installments of assessments payable during the term of the Lease and, in the event of transfer of title to the Tenant, thereafter. ARTICLE 19: LIENS Tenant shall maintain the Premises in good condition and repair. Tenant shall not • create or permit to accrue liens or adverse claims against the Premises which constitute a 5 • lien or claim against Landlord's interest in the Premises. Tenant shall pay to Landlord all amounts, costs and expenses, including reasonable attorneys' fees, incurred by Landlord to remove any such liens or adverse claims. ARTICLE 20: ASSIGNMENT Neither party may assign or sublet its interest in the Premises or in this Agreement to any other party without the express written consent of the non-assigning party. ARTICLE 21: CONDITION OF PROPERTY Landlord makes no representations or warranties as to the safety, suitability,or fitness of the Premises for the uses intended by Tenant. Tenant understands that the property is taken and accepted in all respects in an "as is" condition and has made an independent examination deemed satisfactory and sufficient by Tenant as to the condition of the property. Tenant accepts all responsibility for any asbestos on the property and any required treatment, abatement, mitigation, removal, and disposal thereof required by state or federal law, rule, or regulation, and agrees to defend and indemnify Landlord against all claims, demands, costs, actions, fines, fees, or penalties related thereto, whether brought by private parties or governmental authorities. • ARTICLE 22: SURRENDER In the event the property is not transferred to Tenant at the end of the lease term, the property will be promptly and peaceably surrendered by Tenant to landlord in a neat and clean condition and in substantially the same condition existing on the commencement date of the lease, approved alterations and improvement, reasonable use, wear and tear excepted. ARTICLE 23: MAINTENANCE AND REAPIR OF PREMISES Tenant shall, at all times throughout the term of this lease and at its sole expense, clean, keep and maintain the Premises, together with any improvements thereto made by Tenant, in at least as good condition as existed on the commencement date of this lease, reasonable wear and tear excepted. Landlord shall have no responsibility for the maintenance, repair, construction or reconstruction of the Premises during the term of the lease. 6 IN WITNESS WHEREOF, Landlord and Tenant have caused to be signed, sealed • and delivered as of the day first above written. TENANT: LANDLORD: INDEPENDENT SCHOOL DISTRICT THE CITY OF BROOKLYN CENTER NO. 286, BROOKLYN CENTER By: By: SCAM a4 Chair Its: or B ?Sool 4t4- Zile/zv S By. ACity I B oard Clerk Its: Ma na RRM: #4555/sld • • 7 City Council Agenda Item No. 10i City of Brooklyn Center SpT7 A Millennium Community MEMORANDUM DATE: May 19, 2004 TO: Michael J. McCauley, City Manager FROM: Jim Glasoe, Director of Community Activities, Recreation and Services SUBJECT: Parks and Recreation Commission Recommendation At last evening's Park and Recreation Commission meeting, representatives from the Garden City School Parent Teacher Organization were present to ask for the City's financial assistance related to the purchase of additional playground equipment. New playground equipment is being installed in conjunction with the school's remodeling. Specifically, the Garden City PTO requested the City's assistance in the purchase and installation • of two park benches ($2,000), and the purchase of$4,758 in playground equipment. After considerable discussion, the Commission unanimously passed a resolution recommending the City Council consider amending the current Capital Improvements Plan to include funding for the benches and playground equipment. The Commission is aware that park improvements included in the Capital Improvements Plan for 2004 camiot be deferred, as they are tied to a cooperative agreement with the Brooklyn Center School District. Nonetheless, the Commission recommended the City Council consider the request. As always, please let one know if you have any questions regarding the recommendation, or would like additional information. Additionally, please advise me when the City Council will consider this request. Representatives of the Garden City PTO have requested advance notice, so that they can be present at the meeting to support the request. • 6301 Shingle Creek Parkway Recreation and Community Center Phone & TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall & TDD Number (763) 569-3300 FAX(763) 569-3434 FAX(763) 569-3494 www.cityolbrooklyncenter.org City Council Agenda Item No. lOj CITY OF BROOKLYN CENTER • Notice is hereby y g yen that a public hearing will be held on the 14th day of June 2004 at 7 p.m. or as soon thereafter as the matter may be heard at the City Hall, 6301 Shingle Creek Parkway, to consider An Ordinance Amending Chapter 23 of the City Ordinances of the City of Brooklyn Center Relating to the Licensure of Pawnbrokers. Auxiliary aids for persons with disabilities are available upon request at least 96 hours in advance. Please contact the City Clerk at 763-569-3300 to make arrangements. ORDINANCE NO. AN ORDINANCE AMENDING CHAPTER 23 OF THE CITY ORDINANCES OF THE CITY OF BROOKLYN CENTER RELATING TO THE LICENSURE OF PAWNBROKERS THE CITY COUNCIL OF THE CITY OF BROOKLYN CENTER DOES ORDAIN AS FOLLOWS: Section 1. Chapter 23 of the City Ordinances of the City of Brooklyn Center is hereby amended by adding the following paragraphs: PAWNBROKERS • P ose. The City Council finds that use of services provided by awnbrokers provides an opportunity for the commission of crimes and their concealment because pawn businesses have the ability to receive and transfer property stolen by others easily and quickly. The City Council also finds that consumer protection regulation is warranted in transactions involving pawnbrokers. The City Council further finds that the pawn industry has outgrown the City's current ability to effectively or efficiently identify criminal activity related to pawnshops The purpose of this section is to rep vent pawn businesses from being used as facilities for the commission of crimes and to assure that such businesses comply with basic consumer Protection standards thereby protecting the public health safety, general welfare of the citizens of the city. To help the City better regulate current and future pawn businesses decrease and stabilize costs associated with the regulation of the pawn industry, and increase identification of criminal activities in the pawn industry through the timely collection and sharing of pawn transaction information this section also implements and establishes the required use of the Automated Pawn System (APS). Section 2. Section 23-601 is hereby amended in the following manner: Section 23-601. DEFINITIONS. For the purpose of Sections 23-601 through 23- 630[1], the terms defined in this section have the meanings given them. • ORDINANCE NO. • a. Pawnbroker. Y k t _ �. 2t`7.'c3�:s'?° i'ite'ii"].s f1 pelst.I:`l Who lt'IaIls It"IE)lli"N' on deposit or Pled-g : of l,et:son.�il 's,�lrC)pert-i.. or oih.e� valuable thing. or %Nrh o c ec Ll s in the , urc:ha sh-,g of per c nal. property or offier vaghi�lblc: thing on ccon itioll of selling the SWTIC; E°3i1Ck 8.g$lI1 <,t .t St:lp�j'Mted price, or \,Nl'io leans money sL,€tired by chattel i.no t£ ag e personal pr plertY, taking, possession, o ' hr�perl 'ioe any �r"� s�I =,Ir��°t� ��edf.] Any natural person, partnership or corporation either as principal, or agent or employee thereof, who loans money on deposit or pledge of personal property, or other valuable thing or who deals in the purchasing of personal property, or other valuable thing on condition of selling the same back again at a stipulated price or who loans money secured by chattel mortgage on personal property, taking possession of the property or M part thereof so mortgaged. To the extent that a pawnbroker' s business includes buying personal property previously used rented or leased or selling it on consignment,the provisions of this section shall be ap licable _ b. Reportable Transaction. Every transaction conducted by a pawnbroker in which merchandise is received through a pawn purchase consignment or trade; or in which a pawn is renewed extended or redeemed or for which a unique transaction number or identifier is generated by their point-of-sale software, or an item is confiscated by law enforcement is reportable except: • 1. The bulk purchase or consignment of new or used merchandise from a merchant, manufacturer, or wholesaler having an established permanent place of business and the retail sale of said merchandise provided the pawnbroker must maintain a record of such purchase or consignment which describes each item and must mark each item in a manner which relates it to that transaction record. 2. Retail and wholesale sales of merchandise originally received by pawn or purchase, and for which all applicable hold and/or redemption periods have expired. C. Billable Transaction. Every reportable transaction conducted by a pawnbroker is a billable transaction except renewals redemptions or extensions of existing pawns on items previously reported and continuously in the licensee's possession voided transactions and confiscations Section 3. Section 23-603 is hereby amended in the following manner: Section 23-603. LICENSE FEE. Subdivision 1. The annual fee for a pawnbroker shall be set by the City Council by resolution. • ORDINANCE NO. • Subdivision 2. In addition to the annual license fee a billable transaction fee shall be imposed on each transaction. a. The billable transaction fee shall reflect the cost of processing transactions and other related regulatory expenses as determined by the City Council and shall be reviewed and adjusted, if necessary, every six (6)months. Licensees shall be notified in writing thirty (30) days before any adjustment is implemented. b. Billable transaction fees shall be billed monthly and are due and payable within thirty(30) days. Failure to do so is a violation of this section. Section 4. Section 23-606 is hereby amended in the following manner: Section 23-606. SITE PLAN. Subdivision 2. BUSINESS AT ONLY ONE PLACE. A-license under this section authorizes the licensee to carry on its business only at the prmanent place of business designated in the license. However, upon written request the City Manager's designee may approve an off-site locked and secured storage facility. The licensee shall permit inspection of the facility in accordance with Section 23-627. All • provisions of this section regarding record keeping and reporting apply to the facility and its contents. Property shall be stored in compliance with all provisions of the City Code. The licensee must either own the building in which the business is conducted, and any approved off-site storage facility, or have a lease on the business premise that extends for more than six (6)months. Section 5. Section 23-615 is hereby amended in the following manner: [S;e 1:1.�ot7 3--t-1. . � ,(.,0R1)S. A lucc:nsed p;?wi1. .ilker, at, ti-.te ti.i.ne of :l`ec ipi of an tte:in. must u ine;fiimely .r cor .. in ink or oulior inn c:lible irleditam. in the Eng iisk l n-uage, in a book or N-void processing, unit. the 1:i:h's:)`xvnt2 ..117f£ti':Ix'1alion.] [a. A €oni l '4" a) ac-,curale, dcscrlptl.on. c,,l the i cin 1:ilf.ludii :, bUt I10t 111nited, to. any t,t dej."i"bill;4 iffenLi'it' 1 ioll nffl.:1 e , serial Sl1:t T.[ben C?i�nier applied. l.:t'Ltmber, l"nod l 1`t.tll:ber, b:£'indr),,un)e and or€.3th tl' Stet zlll l~`li't '.. ili it .(s) on l;uell :it.c'all- • ORDINANCE NO. [c1. Nan lesiden,' e address, residence plicme number and clate bl..`srill of the person -Frorn ;0om the 1tC1 i W41lS receiv f;] F". J he identification 1ELIIlibcr trilm an.v o the .t611coi'ving fbi-ins of 1 delluiticati ll of the sefled l �. Valid picture C'lra'.'c',k` s f?.C;ei:ist;e] 12. Cffllciad state photo 'I& 11;1.5cati€n p asspor o.r Tnil11arV 1.1..,x.] [f. 'F he books, Cis vve:il as i-1 ` t.;:i I received. I'-lust be open for :.:n,specti n by ille a he reco r Cti required ? f.i.s 1?Lic depat n.c.n1 during }lsin s l. L7:. 1, subsCO 01I 111LISt be St?:):S` d aml m ainl aai,ed. by the liccensec f r a e €C?d. €f at Years]least three (3) [#.s. A pawnbroh r 1 aisa,. d, dit cor.n17l€::CIon of any t1°iE:n.sa(;t:ion. make iI ph(.-,t0,gp',111.t-dc redcu d cd tl,C. :ll i', the Went,tl.cati.011 LISC , and tl,e transaction rece.<'1)t US1110 a Split iillii£ c„ }Bite raphic dovice,'. A video record o the seller, tile;e ideTlt1_fiCati0Fl used, am'd the transaction rc€eip1 aim, be used in place of 1. pl.)olo raphi. . record prt vIded the vi. eo recordi11<g device produces a clear MIage of at leasi Ilve c�,t seconds in uratiori. All 11) s and, r cci "s mtast be le ble. �, hcii riltated and. must bear the date of the trrinsac;:.on, '1."l1e expo.se i. 6i'n or video tape us.cd to record these Iransaic cioi is 1'1 usl be retrrlaa x] for a 1L .1I aft r bie J,ate Cpl:ehe Iasi. n.-an ifle;lion recorded, 11. I"3 u et be. tu."lled. over to ,in. audi.ori{4:'d peace officer. upoi1 demand. at anv ti.int cluring tt`l.e•; ie.S.e:`nt.don period] [h" i.be iz:Inount due, arlii inaiurity date. and s::I1outil_ly and annual Interest rates T17.C,lLtCltr"g ,all paw"# e s <?p'lil £Il 1J()( ] Section 23-615. RECORDS REQUIRED. Subdivision 1. At the time of any portable transaction other than renewals extensions or redemptions, every licensee must immediately record in English the following information by using ink or other indelible medium on forms or in a computerized record approved by the City_ a. A complete and accurate description of each item including but not limited to any trademark, identification number, serial number, model number, brand name, or other identifying mark on such an item. • ORDINANCE NO. • b. The purchasLprice, amount of money loaned upon, or pledged therefor. C. The maturity date of the transaction and the amount due including monthly and annual interest rates and all pawn fees and charges d. Date, time and place the item of property was received by the licensee and the unique alpha and/or numeric transaction identifier that distinguishes it from all other transactions in the licensee's records. e. Full name, current residence address current residence telephone number, date of birth, and accurate description of the person from whom the item of the property was received including: sex height, weight race color of eyes, and color of hair. £ The identification number and state of issue from any of the following forms of identification of the seller: 1. Current valid Minnesota driver's license 2. Current valid Minnesota identification card • 3. Current valid photo identification card issued by another state or province of Canada. 9. The signature of the person identified in the transaction h. Effective sixty (60) days from the date of notification by the City of acceptable video standards the licensee must also take a color photograph or color video recording of: 1. Each customer involved in a billable transaction 2. Every item pawned or sold that does not have a unique serial or identification number permanently engraved or affixed If a photograph is taken it must be at least two (2) inches in length by two (2) inches in width and must be maintained in such a manner that the photograph can be readily matched and correlated with all other records of the transaction to which they relate. Such photographs must be available to the City Manager's desijznee upon request. The major portion of the photograph must include an identifiable front facial close-up-of the person who pawned or sold the item. Items photographed must be accurately depicted The licensee must inform the person that he or she is being_photogra hp ed by displaying a sign of • sufficient size in a conspicuous place in the premises If a video photograph is taken, the video camera must zoom in on the person pawning or selling the ORDINANCE NO. • item so as to include an identifiable close-up of that person's face Items photographed by video must be accurately depicted Video photogrqphs must be electronically referenced by time and date so they can be readily matched and correlated with all other records of the transaction to which they relate The licensee must inform the person that he or she is being videotaped orally and by displaying a sign of sufficient size in a conspicuous_place on the premises. The licensee must keep the he exposed videotape for three (3) months i. Digitized Photographs. Effective sixty (60) days from the date of notification by the City licensees must fulfill the color photograph requirements in Section 23-615 Subdivision 1(h) by submitting them as digital images in a format specified by the issuing authority, electronically cross-referenced to the reportable transaction they are associated with Notwithstanding the digital images may be captured from required video recordings this provision does not altar or amend the requirements in Section 23-615 Subdivision 1(h) i. Renewals, Extensions and Redemptions For renewals extensions and redemptions, the licensee shall provide the original transaction identifier, the date of the current transaction and the type of transaction k. Inspection of Records. The records must at all reasonable times be open to • inspection by the City Manager's designee Data entries shall be retained for at least three (3) years from the date of transaction. Entries of required digital images shall be retained a minimum of ninety(90) days Subdivision 2. Label Required Licensees must attach a label to every item at the time it is pawned purchased or received in inventory from any reportable transaction. Permanently recorded on this label must be the number or name that identifies the transaction in the shop's records the transaction date the name of the item and the description or the model and serial number of the item as reported to the City, whichever is applicable and the date the item is out of pawn or can be sold if applicable. Labels shall not be re-used Section 6. Section 23-616 is hereby amended in the following manner: ��Ij l 16� 1 . .II.� ' REPO TS . .'�F I TI : ?S] ...... ...... [: ct)rnput rized :i"et'i;rd tra$Isactiori-, i'llusi bc, subill-ju'd to the -,kolice d,epart Tile 111 0!1 a dad 'basis. ITie cCt put :°SEed records ruu.i be coinpatible LNiffi the t`{:4InpLiter syst in used by the Brooklyn t.ent::r Pofi.c )cparlr:rient. LI i.1:eins received naust be :t`£a'porf#xi on. th'c Ili con1puter systE°rn. The ref-) t€ Shall rlic1ud, all Hil'orination i'equi.l-ed, at1€.eC'Section '21-615. • Section 23-616. DAILY REPORTS ORDINANCE NO. • Subdivision 1. Effective no later than sixty 60 days after the City provides licensees with the current version of the Automated Pawn Svstem Interchange File Specification, licensees must submit every reportable transaction to the City daily in the following manner: a. Licensees must provide to the Cit y all reportable transaction information by transferring it from their computer to the Automated Pawn System via modem using the current version of the Automated Pawn System Interchange File Specification. All required records must be transmitted completely and accurately after the close of business each day in accordance with standards and procedures established by the issuing authorily. Any transaction that does not meet the Automated Pawn System Interchange File Specification must be corrected and resubmitted the next business day. The licensee must display a sign of sufficient size in a conspicuous place in the premises which informs patrons that all transactions are reported to the police department daily_ Subdivision 2. Billable Transaction Fees. Licensees will be charged for each billable transaction reported to the City. a. If a licensee is unable to successfully transfer the required reports by modem the licensee must provide the City, upon request printed copies of all • reportable transactions, along with the video tapes) for that date by 12:00 noon the next business day' b. If the problem is determined to be in the licensee's system and is not corrected by the close of the first business day following the failure the licensee must continue to provide the required reports as detailed in Section 23-616 Subdivision 2(a) and must be charged a fifty dollar ($50.00) reporting failure penalty, daily, until the error is corrected; or C. If the problem is determined to be outside the licensee's system the licensee must continue to provide the required reports as detailed in Section 23-616 Subdivision 2(a), and resubmit all such transactions via modem when the error is corrected. d. Regardless of the cause or origin of the technical problems that prevented the licensee from Liploading their reportable transactions upon correction of the problem the licensee shall upload every reportable transaction from every business day the problem had existed. e. Section 23-616 Subdivision 2(a) through (c) notwithstanding the City may, upon presentation of extenuating circumstances delay the implementation of the daily reporting_penally. • ORDINANCE NO. • Section 7. Section 23-618 is hereby amended in the following manner: [ c:.z.i-ion. ?-C?. s. 1-10LDiN(j. An it'.,ni I"eceivect by a "= iwt'I'?3°£)kcr as a pawn or jojn transaction rri av not be sold or t9di rwis K)r a period of ninety (9 0) days after the 1aaw of'`"dwcL 1pt. i oiis:,vb::r, an.indiv id Li al niay vedeerr) an Item, pa-,vned se eMrlIN-t-vo (72) 'it2urs <ai`.er the ite-n,i was Y"eoeit d on di;,pos-11, e'tiC ludlin L111€.ays a,,nd le=..;il holicic1L;ti.l Section 23-618. HOLDING PERIOD Any item purchased or accepted in trade by a licensee must not be sold or otherwise transferred for thirty (30) days from the date of the transaction. An individual may redeem an item seventy-two (72) hours after the item was received on deposit excluding Sundays and legal holiday Section 8. Section 23-619 is hereby amended in the following manner: [Ss:.ctiori. z'- -61 RECEIPT. A l.iccilsed.p?t\) ri?:i�ol�er :Ilaust pr(.)vide <a rd ce.ip to the sell r of ai t includes-1 Id. 1 ll° (1111 rl.arrie. residence cer s3dd e ss, re side nce ielep o ie lit#2l'zsbe .. and &ue of 1:913°t1'l of tfie pledgo o cilt'r.] • K 'i lac address and t e1c:phc iii n9.iniber of t i ibusi less. [c. The date and tinic, of-pa,n or parchase transaction-1 [d, A conic le—ce rarlll accurate desc.riptio of the io," 1 s purchased llCi.l-d-ing rnc,'€ el and serial("!-I.ts7'Iba;r if II:I Iicated (:}i:u1,] ; 7'"t111er a] [:l I.l::i1 2tltTl 2.:1:1cGatli a:l MillAU, St:iL 1 1`1 ; ;Lje Ai3.l€:1 1 1?e €9: 1 t :t?i.l l.i t'Str:i ?I'1) 2t1L i 19 the pIedg r or seller.] 12. A description ription of the pledgor in lLiCiing appro i231tate he;l£„llt., sex canod. nice] ,i.h airlount paid.()i° adlv aiiced ] [i. 1.'he maturity elate Land �ainoul�t du and. the irll>1 hl1 and annual int�les! rates, inelLld ing, all p avvn fees and c1mrges ] • ORDINANCE NO. [j. In iii dlt;:iE ri. the fi.:3 14)�N lYlQ, Siclie.11lentis shall.be print.ed on..ffic rec i ?t:] [.11. £.'n personal st?i. al 1`31°C petty pledged to ,i ;'aw6:1:`}rol1,er wi.th.ir1 this ;st',ite S. t11 ec! to ule or dispa. s� fl. when t 2e1e has been no 1"3i1y,ll`lera nl isle on. the a count for a C'}e1'lod, of not less than 90 days past the t aiC of Lhe p`::Wn tic lsacti.cM., t+aTla`."t'r'ial, or c.x. erasion: no further notice is n c e s;3c ,y, I iere is no c)blh�, it:(€.)7:1 ".or Lhe pled-or io red.'e.m.. pledged gos`)ds. ] [._. 1..-i. �:S '.Li.f7o §..,,.��a. 1". ].t.�:a z ca t4'. t> t7:�{ a ;* �; i s fin. �. U m x . :i. not istoierk. :1t ..lsas no �_]�si c.5. zl�-ll.z1?. ,as33 L a€a i"`€A it and. the led,gor has thc� r1glit to sell oi- Pawn the iLera.] 13. °'`1',k i,t ma is redeemable only by the pled-or U.) �vbom the receipt was 1,ssC ed,, ur aii�l p}W1°on identil1i d i.T:i a ,vritten. an 1'(?tar.i e ,w tl#orization t,:? Icde�—krn the property identified 111 f4e _ieceipl. or a t .i`: i1 ' ;title m % ti . {,e r d r t the '' ' f the d a { il= 1ezI .E##€".;" i] t lt' it i`]c ? i 1?8P i wklirlCL, >11 a'Z7C sio ti'c1 3; the pledgor. YI":1t:t .1i °si it1l,� iz a 11i 1 jlor 1e1a,.se of pr:7t)enly t.i persons other t ,an the oi-iginal pled.gor nui L be 1'1::iahit l.:i.ed ztlo"1.g w,:1tt1i'(he i.?tign' tal t1a1.?:'s<,iction.record,'] • Section 23-619. RECEIPT REQUIRED. Every licensee must provide a receipt to the party identified in evely reportable transaction and must maintain a duplicate of that receipt for three (3) years. The receipt must include at least the following information: a. The name, address, and telephone number of the licensed business. b. The date and time the item was received by the licensee. C. Whether the item was pawned or sold, or the nature of the transaction. d. An accurate description of each item received including, but not limited to, any trademark, identification number, serial number, model number, brand name, or other identifying mark on such an item. e. The signature or unique identifier of the licensee or employee that conducted the transaction. f. The amount advanced or paid. g. The monthly and annual interest rates, including all pawn fees and charges. • ORDINANCE NO. • h. The last regular day of business by which the item must be redeemed by pledgor without risk that the item will be sold, and the amount necessary to redeem the pawned item on that date. i. The full name, current residence address, current residence telephone number, and date of birth of the pledgor or seller. i. The identification number and state of issue from any of the following forms of identification of the seller: 1. Current valid Minnesota driver's license. 2. Current valid Minnesota identification card. 3. Current valid photo driver's license or identification card issued by another state or province of Canada. k. Description of the pledgor or seller including sex race color of eves color of hair, approximate height and weight. 1. The signature of the 1p edgor or seller. • M. All printed statements as required by Minnesota Statutes, Section 325J.04 Subd. 2, or any other applicable statutes. Section 9. Section 23-620 is hereby amended in the following manner: �_gtjr?1r } (i 'f1.. I0[JCE ORDERS. If` a City police officer or other lavv r:.nfiorcciTierlt ofll:er tio?i:1wes a dealer r :€ oi. t,o sel] ari 1tht I.eixi :nia w not be sold or i-1- n(.r'ed I:ri:ni the licensed premises u:(-A ti authorized to 1',e released bN Lhe police. or court. order. RCM riold icalion, i:1 verbal. should be fioll o-��;c d [IN z! writtel €31`dz1 v4,ithin fourteen (14) days setting. 10 rth. the t.tr;rn to be held arid th-e:reasons Lher ifore] w Section 23-620. POLICE ORDER TO HOLD PROPERTY. Subdivision 1. Investigative Hold. Whenever a law enforcement official from any agency notifies a licensee not to sell an item, the item must not be sold or removed from the premises. The investigative hold shall be confirmed in writing by the originating agency within seventy-two (72) hours and will remain in effect for fifteen (15) days from the date of initial notification, or until the investigative order is canceled, or until an order to hold/confiscate is issued, pursuant to Section 23-620 Subdivision 2, whichever comes first. ORDINANCE NO. Subdivision 2. Order to Hold. Whenever the City Manager's desijznee, notifies a licensee not to sell an item, the item must not be sold or removed from the licensed premises until authorized to be released by the City Manager's designee The order to hold shall expire .ninety (90) days from the date it is placed unless the City Manager's designee determines the hold is still necessary and notifies the licensee in writing. Subdivision 3. Order to Confiscate. If an item is identified as stolen or evidence in a criminal case,the City Manager's designee may_ a. Physically confiscate and remove it from the shop pursuant to a written order from the City Manager's designee, or b. Place the item on hold or extend the hold as provided in Section 23-620 Subdivision 2 and leave it in the shop When an item is confiscated the person doing so shall provide identification upon request of the licensee and shall provide the licensee the name and phone number of the confiscating agency and investigator, and the case number related to the confiscation. • When an order to hold/confiscate is no longer necessary, the City Manager's designee shall so notify the licensee. Section 10. Section 23-624 is hereby amended in the following manner: [: ttl .li 1 . t .i: ::1 ; '" , �:ND `�,(,.i ii .] [Subdivisi on i. vIin rs: A minor 1I1iiy not sell. or taltempt to sell.. goods Frith a P i- ribrok r. i !av 1� ;'o Lt rt:?wias I of =` eiv '()(€� troi i1:tiYta€1`.] ` w bdi- isi,o1 -. Others: A iavvnb1 }ker ryi.,,y ru.3treceive any se}Cis fri..n a " 'rson o a. xasisoutid Timid , S C u ,Iltoxi Lat4.+al e ,`s(:}si.] [Subdivision 3. i.iet alficaA¢,orc .;\ pa%viibroker 3It i not receive gsfo3 dis, izrfl .'?s the seller presciils idelitiheatiori iii th-, Gmi"1 of a valid picture drivers licer)se or oFficia statc photo ICiemi c 1tlt,'",. U riite; Swt:4 (iii:-.,,sport or inil(t:ary .1.19.] [ ubdit t;ioii 4. 0,xnershif,- No inerson ma : ,,tm,,2. sell, or e p-o) it .ivy artiele €f r0 er1'y t:1lt 'IS riot Moir o'v 111 • ORDINANCE NO. [`ltbdav i`lil 5. St<2t Su3I ? C^: Yl )a;tItl }� 111es>ta y l<� tes. (, ?:3 )s'; 3 2". , is Section 23-624. PROHIBITED ACTS AND SIGNAGE a. No person under the age of eighteen (18) years may pawn or sell or attempt to pawn or sell goods with any licensee nor matey licensee receive any goods from a person under the a e of eighteen(18) years b. No licensee may receive any goods from-a person of unsound mind or an intoxicated person. C. No licensee may receive any p-oods unless the seller presents identification in the form of a valid driver's license a valid State of Minnesota identification card, or current valid photo driver's license or identification card issued by the state or providence of residency of the person from whom the item was received. d. No licensee may receive any item of property that possesses an altered or obliterated serial number or operation identification number or any item of property that has had its serial number removed • e. No erson may awn p �p . pledge, sell, consign, leave or deposit any article of property not their own, shall any person pawn pledge sell consign leave, or deposit the property of another, whether with permission or without; nor shall any person pawn pledge sell consign leave or deposit any article of property in which another has a security interest; with any licensee £ No person seeking to pawn pledge sell consign leave or deposit an article of property with any licensee shall give a false or fictitious name; nor give a false date of birth; nor give a false or out of date address of residence or telephone number; nor present a false or altered identification or the identification of another; to any licensee g_ [`Ube . k i Rio 6.1 Signage: A sign must be conspicuously posted on each licensed premises that is not less than four feet square in surface area, comprised of lettering not less than 3/4"high stating the following: To pawn or sell property: A. You must be at least 18 years of age. B. You must be the true owner of the property. C. The property must be free of all claims and liens. • D. You must present valid photo identification. ORDINANCE NO. • E. Violation of any of these requirements is a crime. F. All transactions are reported to police department daily. Section 11. Section 23-625 is hereby amended in the following manner: Section 23-625. LICENSE DENIAL, SUSPENSION OR REVOCATION. A license under this section may be denied, suspended or revoked by the City Council after a public hearing where the licensee is granted the opportunity to be heard, for one or more of the following reasons: [ia.. 1he b?l'erat,ion of the buss c's is in a:;t)nflict with iat:N;, provision of this ar"rz:Irr.11d..'rianc :on"in�Y. fit-other provision oFthi7 ordinance or is xv J [c. The licensee or the Nisiness l_11°OMISC fails to COT14 r r1 With the standards ,`.car .license gal plicatiw-, contained in this sectiota:] • [dl ..l.,h licensee has l¢rded to cor:1apl•- with. one €r rnore provisions of this section c;r<ar1V st.rta.rte. 1.111 Or ordinance pertadnirig tra the business crt pw,,-rabro,kcn; [e. J`rai,id, n)h P`epreserttaar:rc n or bribery in sec;tarrrrg a li £r1se] [F. 1't",111£, r}aisre }re`ientscalon 3 r F�Ilse `tiate731ents n1ade in the course of, flle aap lS.irb ant's business, [?< `�iubjeo to t.l Provisions 4?" .c21k.. tl"""lL licensee 12&ts been convicted zctccl Cal` i1 t' isttf or .f'deral lia��, rel,atino to receiving stolen 'l1t°opert:y, sale of:Stop:. property or controlled s ibstwiccs, bttr glary, robbery Theft. darner e or tres }�as� to prcP e yt l £a.r6atic�a F=f` ra bu.1tles'S, 01, aar1�" or ordiriance repulaung the l usiriess of a. The proposed use does not comply with the any applicable zoning code. b. The proposed use does not comply with any health building building maintenance, or other provisions of this Code of Ordinances or state law. C. The applicant or licensee has failed to comply with one or more provisions of • this section. ORDINANCE NO. • d. The applicant is not a citizen of the United States or a resident alien or upon whom it is impractical or impossible to conduct a background or financial investigation due to the unavailability of information. e. Fraud, misrepresentation or bribery in securing or renewing a license £ Fraud, misrepresentation or false statements made in the application and investigation for, or in the course of,the applicant's business. g. Violation within the preceding five (5) years of any law relating to theft damage or trespass to property, sale of a controlled substance or operation of a business. h. The owner of the premises licensed or to be licensed would not qualify for a license under the terms of this section. Section 12. Section 23-626 is hereby amended in the following manner: Section 23-626. REDEMPTION PERIOD. [A pers0 3- 3 .> ,yawns an item shiall have at least 90 da;v; to r`iaeetri t le ittevy) bel'u've it ?ri ev be SON, b e £€ 17Ip<I£ I� and S.-ffl'utt. shall olh r%vise be governed hV Miffilea)t,�l "",UMUS, Chapter 325.x.1 Au person pledging, • pawniniz, or depositing an item for security must have a minimum of ninety (90) days from the date of that transaction to redeem the item before it may be forfeited and sold. During the ninety (90) day holding period items may not be removed from the licensed location except as provided in Section 23-606 Subdivision 2 Licensees are prohibited from redeeming any item to anyone other than the person to whom the receipt was issued or, to any person identified in a written and notarized authorization to redeem the property identified in the receipt, or to a person identified in writing by the pledgor at the time of the initial transaction and signed by the pledgor, or with approval of the City Manager's designee. Written authorization for release of property to persons other than original pledgor must be maintained along with original transaction record in accordance with Section 615 Subdivision 1(i). Section 13. Section 23-627 is hereby added as follows: Section 23-627. INSPECTION OF ITEMS. At all times during the terms of the license the licensee must allow law enforcement officials to enter the premises where the licensed business is located, including all off-site storage facilities as authorized in Section 23-606 Subdivision 2 during normal business hours except in an emergency, for the purpose of inspecting such premises and inspecting the items ware and merchandise and records therein to verify compliance with this section or other applicable laws. • ORDINANCE NO. • Section 14. Section 23-628 is hereby repealed as follows: p lie City or the Sui t f \litinesoul tiial.4' etiler aliicl searc1i iisiness preryiise, liceiised url{:1er this $.'i:uori. or ofi'. 3te stt3S°a;g,e il{.pities o C le licensee, il3.lr t—; li li"rna l btisine ss hours. vvarrarn f€r d p ttr-1,-) s of trl's p 'cthi3g such pi.vaiises aml the records inn ailic.les diereln.] Section 15. Section 23-629 is hereby renumbered to Section 23-628. Section 16. Section 23-630 is hereby renumbered to Section 23-629 and amended in the following manner: Section 23-030129.0129. SEVERABILITY. If any part of Sections 23-601 through 23-630111 shall be adjudged to be invalid by a court of competent jurisdiction, such judgment or decree shall not affect or impair the remainder of said sections. Section 17. Section 23-631 is hereby renumbered to Section 23-630 and amended in the following manner: Section 23-63[I]0. PENALTIES. Any person violating any provision of Sections 23-601 • through 23-630[] shall be guilty of a misdemeanor, and upon conviction thereof, shall be punished by a fine of not more than one thousand dollars ($1,000) and imprisonment for not more than 90 days, or both,together with the cost of prosecution. Section 18. This ordinance shall be effective after adoption and thirty days following its legal publication. Adopted this day of , 2004. Mayor ATTEST: City Clerk Date of Publication Effective Date (Brackets indicate matter to be deleted, underline indicates new matter.) • ��pOKIYN CEMTF9 is BROOKLYN CENTER POLICE DEPARTMENT PONCE MEMORANDUM TO: Michael McCauley, City Manager FROM: Scott Bechthold, Chief of Police DATE: June 22, 2004 SUBJECT: Automated Pawn System(APS) I am requesting approval for the Brooklyn Center Police Department to become part of the Minneapolis Automated Pawn System(APS)to improve efficiency with the City's compliance and regulation of its pawn system ordinance, as well as eliminate expenses incurred by our current pawnshop information processing. • The Automated Pawn System is a proprietary pawnshop identification and tracking system developed by the Minneapolis Police Department. APS consists of the collection, maintenance and storage of detailed data submitted daily from local pawnshops throughout the metropolitan area(as required by ordinance). Access to the APS allows law enforcement agencies to: • Inquire and run reports. • Download data in compliance with regulatory functions and licensing. • Collect intelligence information used to regulate pawnshops within their city limits. • Collect data on all pawnshops within the APS—an invaluable tool for solving property crimes. APS is currently operating within forty-four metro county sheriff departments and agencies in communities surrounding he City of Brooklyn Center Attachment 1 . A number of additional g y Yn ( ) agencies have requested APS Service and Software License Agreements (Attachment 2). Second- hand stores may also become part of the APS. Several suburban communities that do not have pawnshops are APS subscribers with read-only access because of the valuable intelligence information it provides. The primary benefits to Brooklyn Center becoming part of the APS would be: • Recovery of 15 hours expended weekly on our current process. • An estimated annual result of$17,064.00 in revenues. • • Quick access of up-to-date intelligence information. • Elimination of errors. Pawnshop Time and Cost Com arison Current Automated • System Pawn System Fevenues � Revenue generated from pawnshop license fees $12,000.00 $3,000.00 Revenue from Transactions ** $30,000.00 Total $12,000.00 $33,000.00 Marginal Costs MPLS Annual Connection Fee $516.00 LOGIS Annual Fee $420.00 $420.00 Per Transaction Fee **$15,000.00 Total $420.00 $15,936.00 Net $11,580.00 17,064.00 *Under our current system: 13 hours(Detective Karris),and 5 hours(Dispatch). Under the APS: 3 hours(Detective) ** This figure represents the$2.00 fee Brooklyn Center would charge pawnshops. The City of Brooklyn Center would pay MPD a$1.00 fee on every transaction. There is a one-time fee of$1,500.00, which includes: • Technical support, • Access to all equipment and information available through APS, and • Training for two staff members at Brooklyn Center Police Department to become on- site APS coordinators. Under our present process,Detective Karris spends approximately thirteen hours a week processing pawnshop data, checking pawnshop records from other agencies, checking APS information with Minneapolis, and processing teletypes from other police departments. Brooklyn Center dispatchers spend approximately five hours a week running computer checks to determine whether or not property is stolen. Information provided by the APS is available lable printout of items with serial Y as a p ial n umbers (including NCIC coding—thereby eliminating the time spent identifying each item, looking through 1,300 codes, and manually coding each item). The current system is a modified database program with limited capabilities, and has no means of correction or notification of errors. The APS detects errors, and the pawnshops are notified. The pawnshops are then required to correct the errors and resubmit the data to the APS. This would eliminate the time needed to manually check every pawnshop ticket against the printout. Since we are a LOGIS customer, we would receive communication to APS through the existing frame relay connection used by Multiple Jurisdiction Network Project. This will eliminate the need for a direct modem connection to the Minneapolis Police Department. The ongoing monthly charge from Minneapolis to run two concurrent connections of APS would be $43 a month($516 annually). The • LOGIS fee is estimated at approximately$35 a month($420 annually). Currently, the City of Brooklyn Center charges $12,000 a year for a pawnshop license, which is the • only source of revenue received. Most jurisdictions participating in the APS system, however, have lowered their license fees to approximately $3,000 annually. The$9,000 difference in revenue under the APS scenario would be recovered by charging a fee for each transaction conducted by the pawnshop. Law enforcement agencies have added a per-transaction cost for regulation and compliance monitoring. The pawnshop dealers are billed accordingly. (I recommend the average $2 fee per transaction). There were over 15,000 transactions conducted in Brooklyn Center from July 1, 2002 to June 30, 2003. Thus, $30,000 from transactions could conceivably be generated with an additional $3,000 received in pawnshop license fees. However,the Minneapolis Police Department invoices law enforcement agencies that are part of the APS at a billable transaction fee rate of$1. For 15,000 transactions, $30,000 would be generated in revenue, with Minneapolis and Brooklyn Center each receiving $15,000. Once the city council approves this initiative and a signed agreement is in the hands of MPD, it will begin the process of getting BCPD on-line. The process is as follows: 1. Signed agreement with $1,500.00 connection fee. (New User Information and APS Store Information forms are needed at this time.) 2. BCPD can query data within two-three days. 3. Pawnshop is given a 60 days notice as required by the city ordinance. 4. MPD creates a new store book for pawnshop. 5. Training sessions (two) are scheduled for BCPD officers within 2-3 weeks of coming on board. One session is 3 hours and is an introduction course for detectives who will use the system. • The second session is 4-5 hours and is for the detective/officer who will administer the system. The pawnshop has already paid its $12,000.00 fee for 2004 and it is expected that the BCPD will go on-line with APS mid-year. Still, it is recommended that BCPD implement the billable transaction fee of$2.00 per transaction. The BCPD spoke with the management of Cash N Pawn and they are in agreement with this proposal. Cash N Pawn intends to pass the $2.00 transaction fee onto the consumer. Also as stated previously, there were 15,000 transactions from July 1, 2002 through June 30, 2003. This amounts to approximately .80 per transaction under the Curren t system. If the average transactions bear out over the six month period, the city will have taken in a pp roximatel y$15,000.00, 00, $7,500 which will go to MPD, leaving a balance of$7,500.00. SB/bg Attachments: Automated Pawn SystemTM Service:Jurisdictions(June 2003) Automated Pawn System(APS)Service and Software License Agreement(07/02/03)and Fees Draft of Revised Pawn Ordinance • • Automated Pawn SystemTm Service June 2003 Jurisdictions that have requested Software Jurisdictions that have signed License and Service Software License and Service Agreements A reements Alexandria PD Airport PD Minnetrista.PD **Anoka County SO *Anoka PD New Hope Bayport PD Apple Valley PD Orono PD **Beltrami County SO Belle Plaine New Brighton PD **Bemidji PD "Blaine PD New Praque **Brooklyn Center PD *Bloomington PD **Owatonna PD Plymouth **Cloquet Brooklyn Park PD Prior Lake Cambridge PD *Burnsville PD *Ramsey County Sheriff **Faribault PD *Carver County Sheriff *Red Wing PD **Duluth PD Champlin PD "Rice County Sheriff **Eau Claire WI PD Chaska PD *Richfield **Fargo ND PD *Chippewa Fails WI PD *Robbinsdale PD **Grand Rapids Chisago County Sheriff *Rochester PD "Hutchinson PD Columbia Heights PD *Roseville PD Nicollet County SO *Coon Rapids PD Savage Northfield PD Cottage Grove PD *Scott County Sheriff Mankato PD Crystal PD *Shakopee Maple Grove Dakota County Sheriff Sibley County Sheriff McLeod County SO Eagan PD So.Lake Minnetonka PD Mille Lacs SO Eden Prairie PD *St.Cloud PD Minnetrista PD Edina PD *St.Louis Park PD **Moorhead PD Elk River PD *St Paul • Olmsted SO Elko-New Market *Spring Lake Park PD Pierce CO WI SO Fillmore County Sheriff Steele County Sheriff **Ramsey PD *Fridley PD University of MN PD Rosemount PD Golden Valley Washington County Sheriff **Sherburne SO *Hastings Police Dept West Hennepin Public Stillwater PD Hennepin County Sheriff Safety White Bear Lake PD *Hopkins PD *West St Paul PD *Isanti SO *Wright County Sheriff Jordan PD Lakeville PD LeSeuer County Sheriff Lino Lakes PD Maple Grove PD Meeker County Sheriff Mendota Heights PD *Minneapolis Minneapolis Park Police MN Dept of Corrections Minnetonka Contributing Jurisdictions Data contributor/ordinance pending c:t docume-llskarri-1.broVocals-litemp\gwvlewerlaps subscribers 6.03.doc • AUTOMATED PAWN SYSTEM (APS) SERVICE AND • SOFTWARE LICENSE AGREEMENT This Agreement is made and entered into this day of by and between the City of Minneapolis, a municipal corporation in the County of Hennepin, State of Minnesota, hereinafter referred to as City of Minneapolis or Licensor; and the City of , a municipal corporation in the County of , State of Minnesota, hereafter referred to as the City of or Licensee. WHEREAS: The Minneapolis Police Department utilizes a computerized pawn shop records system (APS Service or AUTOMATED PAWN SYSTEM Service); and WHEREAS: Licensee desires to take advantage of the APS Service developed and maintained by the Minneapolis Police Department; NOW, THEREFORE, in consideration of the convenants contained herein, the parties agree as follows: ARTICLE I: Definitions Terms defined in this Article I, and parenthetically elsewhere, shall throughout the Agreement have the meanings here provided. Defined terms may be used in the singular or plural. • "Agreement" means this Agreement and its Schedules and Exhibits, which are incorporated in, and form an integral part of, this Agreement. "APS SERVICE and "AUTOMATED PAWN SYSTEM SERVICE" refers to the proprietary pawn shop identification and tracking system developed by the City of Minneapolis including software, documentation, and enhancements. The Automated Pawn Service System consists of computing services, information-related services, software, information and other content provided by the City of Minneapolis, as well as access to APS content provided by parties other than the City of Minneapolis (collectively "Acquired Material"). "Content" means pawn shop transaction records, data and information available on the APS Service. "Data Contributing Licensee" means any Licensee which licenses and regulates pawnbrokers or secondhand dealers, and requires them to submit specific information related to specified types of transactions, daily, via dial-up connection to APS Service central data site. "Enhancements" means software programs and sub-programs in addition to the Software described in Schedule 1. "Query Only Licensee" means any Licensee which does not license or regulate pawnbrokers or secondhand dealers. ARTICLE II: Software Delivery and Installation The City of Minneapolis shall deliver to Licensee APS Service software in accordance with Schedule 1. • Licensee shall have the responsibility of software installation. c: \winnt\profi les \hardym mO\desktop\ag reement. doc 1 ARTICLE III: Title and Risk Title to the APS Service software, including the ownership of all copyrights, patents, trademarks, trade secrets and all other intellectual property rights subsisting in the software, documentation, enhancements, adaptations, and any modifications thereto shall at all times remain • with the City of Minneapolis. ARTICLE N: Payment Payment of the License and Use Fee shall be in accordance with the provisions of Schedule 2. ARTICLE V: License Terms SOFTWARE LICENSE Subject to the terms of this License Agreement, City of Minneapolis grants to Licensee a non- exclusive, nonassignable and nontransferable license to use and display the software provided by or on behalf of City of Minneapolis for purposes of accessing the APS Service on any machine(s) of which Licensee is the primary user or which Licensee authorizes for use. Unauthorized copying of the software, including software that has been modified, merged or included with the Software, or the written materials associated therewith is expressly forbidden. Licensee may not sublicense, assign or transfer this license or the Software except as. permitted by City of Minneapolis. Any attempt to sublicense, assign or transfer any of the rights, duties or obligations under this License Agreement is void. LICENSEE RESPONSIBILITY. Licensee shall be responsible for all access to and use of the APS Service through Licensee's account or password(s). ARTICLE VI: Licensoe's Warranties and Limitations of Liability • LICENSEE EXPRESSLY AGREES THAT AT USE OF THE APS SERVICE IS AT LICENSEE'S SOLE RISK. NEITHER CITY OF MINNEAPOLIS NOR ANY OF ITS CONTENT PROVIDERS, APS SERVICE PROVIDERS, LICENSOR, EMPLOYEES OR AGENTS WARRANT THAT THE APS SERVICE WILL BE UNINTERRUPTED OR ERROR FREE; NOR DOES CITY OF MINNEAPOLIS OR ANY OF ITS INFORMATION OR CONTENT PROVIDERS, LICENSOR, EMPLOYEES OR AGENTS MAKE ANY WARRANTY AS TO THE RESULTS TO BE OBTAINED FROM USE OF THE APS SERVICE. THE APS SERVICE IS DISTRIBUTED ON AN "AS IzS"AND "AS AVAILABLE" BASIS WITHOUT WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF TITLE OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, EXCEPT FOR THOSE WARRANTIES, IF ANY, WHICH ARE IMPLIED BY, AND INCAPABLE OF EXCLUSION, RESTRICTION OR MODIFICATION.UNDER, THE LAWS APPLICABLE TO THE LICENSE AGREEMENT. NEITHER CITY OF MINNEAPOLIS NOR ANY OF ITS INFORMATION OR CONTENT PROVIDERS, APS SERVICE PROVIDERS, LICENSORS, EMPLOYEES OR AGENTS SHALL c:\winnt\profi les \hardym mO\desktop\ag reement. doc 2 • BE LIABLE FOR ANY DIRECT, INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL • DAMAGES ARISING OUT OF USE OF THE APS SERVICE OR INABILITY TO USE THE APS SERVICE OR OUT OF ANY BREACH OF ANY REPRESENTATION OR WARRANTY, EXPRESSED OR IMPLIED. ARTICLE VII: Termination and Modification MODIFICATION OF THIS LICENSE AGREEMENT AND THE APS SERVICE. Upon notice, City of Minneapolis may modify this license Agreement, including, without limitation, pricing and billing terms. City of Minneapolis may discontinue, add to, or revise any or all aspects of the APS Service in its sole discretion and without notice. TERMINATION BY LICENSEE. Licensee is free, if City of Minneapolis modifies this License Agreement, the APS Service, or related pricing or billing terms, to immediately terminate Licensee's account and this License Agreement. Licensee may otherwise cancel this License Agreement, without cause, with a thirty (30) day written notice. Licensee shall carry out any termination in accordance with the method or methods established by City of Minneapolis. TERMINATION OR SUSPENSION BY CITY OF MINNEAPOLIS. City of Minneapolis may terminate the Licensee's account and this License Agreement in the event of any breach of this Agreement by Licensee or a user of Licensee' account. City of Minneapolis reserves the rights in its sole discretion to terminate the Licensee's account and • this License Agreement at any time or to suspend (with or without notice) or terminate access to or use of the APS Service, in whole or in part, with respect to any Licensee (and/or with respect to any user of Licensee's account) at any time. CONTINUATIONS OF OBLIGATIONS. Notwithstanding any cancellation or termination of this License Agreement or any account, or any suspension or termination of access to or use of the APS Service, Licensee will remain responsible for any obligations then accrued, including payment of any charges that may be due as of or in connection with such actions. ARTICLE VIII: Use and Assignment LIMITATION ON USE OF CONTENT. Except as expressly permitted in this License Agreement, neither Licensee nor an user of p Yp 9 � Y Licensee's account may reproduce, distribute, transmit, publish, or otherwise transfer or commercially exploit any content received or accessed through the APS Service. ILLEGAL PURPOSES Licensee agrees not to use the APS Service or any of its elements or related facilities or capabilities to conduct any activity, or solicit the performance of any activity, which is prohibited by or would violate any applicable law, rule, regulation or legal obligation. • c:\winnt\profi les \hardym mO\desktop\ag reement. doc 3 • LIMITS ON TRANSFERS; OTHER LIMITS Unless otherwise agreed in writing, Licensee's right to use the APS Service, or to designate other users of its account, is not transferable and is subject to any limits established by City of Minneapolis and provided to Licensee in writing. ARTICLE IX: Entire Agreement This agreement, as well as the additional materials specifically referred to herein as being a part of this License Agreement, constitute the entire and only agreement with respect to the subject matter hereof (collectively, the License Agreement") between City of Minneapolis and Licensee. This License Agreement supersedes all representations, proposals, inducements, assurances, promises, agreements and other communications with respect to the subject matter hereof except as expressly set forth in this document. By executing this Agreement, Licensee agrees to the terms and conditions of this License Agreement. ARTICLE X: Governing Law; Severability This License Agreement is made in the State of Minnesota. This License Agreement and all of the parties respective rights and duties in connection herewith shall be governed by and construed in accordance with the laws of the United States of America, and, excluding conflicts rules, of the State of Minnesota. Any cause of action of Licensee, or by users of Licensee's account, with respect to the APS Service or this License Agreement must be instituted within one year after the claim or cause of action has arisen or be barred. • CITY OF MINNEAPOLIS By: Mayor By: Chief of Police or Deputy Chief of Police Countersigned: Finance Officer Approved as to Form Assistant City Attorney • c: \wi n nt\profiles \hardym mO\des ktop \agreeme nt. doc 4 SCHEDULE 1: APS SYSTEM AND OBLIGATIONS • APS SYSTEM License for the use of the APS Service as described in this agreement applies to the installation and usage of, and access to the following components on the Licensee's equipment: 1. APS Service client software and relevant enhancements (supplied on distribution diskettes, or via the APS Service software distribution files located on the licensor's computer network). 2. APS Service documentation (Help files) included on the APS Service client software.3. APS Service oriented user documentation. In addition, Licensee is granted access to the following services as authorized in Schedule 2: 1. Access to the APS Service central site database via network or dial-up connection as authorized by the APS Service administrator. 2. Access to APS support staff by Licensee's APS Service Jurisdiction Administrator for operational questions related to accessing the service via network or dial-up connection. Use of Contents Neither Licensee nor any user of the Licensee's account may reproduce, distribute, transmit or otherwise transfer any content received or accessed through the APS Service except as required, and legally allowed, in the conduct of authorized investigations of criminal activity, or verification of compliance with applicable operational laws and regulations by pawnbrokers, secondhand dealers, or precious metal dealers. Ancillary Equipment • Licensee is responsible for acquiring and maintaining all telephone and computer hardware and services necessary to access and use the APS Service via network or dial-up connection. APS Client System Requirements: Workstations must be capable of connecting to the APS central server at the State of Minnesota either by dial-up or permanent network connection and must be running Windows NT 4.0, Windows 9x, Windows Me, or Windows 2000. The minimum system requirements for running the APS client are an Intel Pentium 300Mhz (or faster) with 64 Mb RAM, VGA monitor with 800x600 resolution and 256 colors, and a 56k baud modem (if a permanent network connection is not available). Operational Responsibilities Every Licensee is responsible for the following: 1. Installation of all hardware components, PC operating software, networking software and APS Service client software. 2. Designating an employee as the APS Service Jurisdiction Administrator. (See Schedule 1-A for current Jurisdiction Administrator roles and tasks.) 3. Designating an employee as the APS Service Investigator/User Trainer. 4. Assignment and administration of appropriate user codes and passwords to authorized users of the APS Service system within its jurisdiction. In addition, every data contributor Licensee is responsible for: c: \wi n nt\profiles \hardym mO\des ktop\agreement. doc 5 • • 1. Coordination and administration of the addition of licensed jurisdiction dealers who will be sending data via modem to the APS Service central site. 2. Orientation and training of dealers within the Licensee's jurisdiction regarding APS Service dial-up connection process, reporting requirements and error correction procedures. 3. Verification of the electronic collection of pawn and secondhand dealer transaction data as required by the Licensee's applicable ordinances. 4. Manual entry of pawn and secondhand transaction data when dealer(s) are unable or fail to do so via modem as required by Licensee's applicable ordinances and APS Service policies. 5. Adherence to APS Service policies and procedures as established by the Minneapolis APS Service Administrator. • c:\winnt\profi leg\hardym mO\des ktop\agreement. doc 6 SCHEDULE 2: PAYMENT AND CHARGES FEES, TAXES AND OTHER CHARGES Licensee shall pay all applicable taxes related to use of the APS Service by Licensee or by • users of Licensee's account. Information on charges and surcharges (if any) that are paid to City of Minneapolis and are incurred by Licensee or by users of Licensee's account will be made available to Licensee, and Licensee agrees that this is sufficient notice for all purposes as to charges incurred and paid or to be paid to City of Minneapolis. COMMENCEMENT AND DURATION OF LICENSE FEES Licensee acknowledges that (subject to any exceptions granted by City of Minneapolis) a monthly Licenseeship will continue until Licensee cancels the account in accordance with the methods established by the City of Minneapolis. As provided for above, Licenseeship may be canceled by Licensee at any time. The monthly Licenseeship fee shall cease to apply for any month after the billing month in which this License Agreement is terminated pursuant to its terms. PAYMENT FOR SERVICES Licensee will be invoiced monthly for prior month's fees and charges. Invoices are due and payable upon receipt. If payment is not received within 30 (thirty) days from date of invoice, City of Minneapolis may suspend or terminate this license agreement. FEE SCHEDULES Fees will be billed at either the Query Only Licensee or Data Contributing Licensee rate, depending on which is applicable. Licensees that are initially billed as Query Only Licensees shall receive full credit for all setup and training fees If, and when, they become Data Contributing Licensees. Query Only Licensee • Setup and Training $240.00 (All training requires and assumes working knowledge of Microsoft WindowsTM.) 1. Establish Licensee's account on APS Service. 2. Two (2) hours training for Licensee's designated APS Service Jurisdictional Administrator at APS central site. 3. Three (3) hours training for Licensee's designated APS Service Investigator/User Trainer at APS central site. 4. Additional investigator/user training at APS central site $45.00 per hour, per attendee. Query only licensee access fees utilize the Minnesota Criminal Bureau of Apprehension multi-tier agency ranking structure based on a combination of the population and number of employees. Licensee is a tier agency. 1. Access Fee for Primary Investigator(s)/User(s) Unlimited access to the APS Service for two (2) simultaneous designated users, via a network conn' . ordance with th rtions of this Tier 1 & 2 A Tier 3 &4 A Tier 5 & 6 $72.00 Per$54.00 Per on $36.00 Pe c:\winnt\profi les \hardymmO\desktop \ag reement. doc 7 • 2. Access Fee for Additional Simultaneous Investigator(s)/User(s) for all licensees connected via a network connection, in accordance with the applicable portions of this agreement $36.00 Per Month Per User • Data Contributing Licensee Setup and Training $1,050.00 (All training requires and assumes working knowledge of Microsoft WindowsTM.) 1. Establish Licensee's account on APS Service. 2. Eight (8) hours training for Licensee's designated APS Service Jurisdictional Administrator at APS central site. 3. Two (2) hours training for Licensee's designated APS Service investigator/user trainer at APS central site. 4. Additional investigator/user training at APS central site $45.00 per hour, per attendee. Data Collection and Maintenance Fee $1.00 Each Billable Transaction 1. For purposes of this License Agreement, a billable transaction is every reported transaction conducted by a pawnbroker or secondhand dealer in which merchandise is received through a pawn, purchase, consignment or trade. 2. Collection and maintenance administration of all reportable and billable transaction information as defined by Licensee's ordinances and received via network or dial-up connection. 3. Monthly billing to Licensee of all billable transactions received, which dealer they were submitted by, and whether they were electronically uploaded from the dealer or manually entered by the Licensee. Access Fee for Primary Investigator(s)/User(s) Using a Network Connection $ N/C Per Month 1. Unlimited access to the APS Service for two (2) simultaneous designated users, via a network • connection, in accordance with the applicable portions of this agreement. 2. Access Fee for Additional Simultaneous Investigators)/User(s) for licensees connected via a network connection, in accordance with the applicable portions of this agreement $36.00 Per Month Per User c:\wi not\profiles \hardym mO\des ktop\agreeme nt. doc 8 • • SCHEDULE 1-A:APS SERVICE JURISDICTION ADMINISTRATOR APS Service Jurisdiction Administrator The Licensee's APS Service Jurisdiction Administrator is responsible for the day-to-day operation of APS within the Licensee's jurisdiction. She (or he) is the point of contact for technical and operational questions from Licensee's investigators and pawn dealers (Data Contributing Licensees Only). This person will interact regularly with the APS Administrator at the Minneapolis Police Department (MPD) on issues and questions regarding operations and policy which are system-wide (not just Licensee- specific). Primary functions include: Provide focal point for all APS Service operational and policy activity for Licensee, Provide end user support as a "first call for help"when questions or incidents occur regarding APS Service usage within Licensee's jurisdiction, . Maintain dialogue with APS Administrator at MPD for questions and support issues, Startup Tasks (All Licensees) 1. Define a process or series of steps to receive, log, process and track APS support calls (e.g. who gets called, what information to take, how to forward or close contact, how to accumulate statistics and track open contacts, etc.). 2. Gain familiarity with APS administrative screens to set up new users. Startup Tasks (Data Contributing Licensees) • 1. Gain familiarity with APS administrative screens to set up new dealers and support billing functions (Data Contributing Licensees). 2. Gain familiarity with the APS Service upload process and directory structure used for dealer upload files, logs, archived transactions (Data Contributing Licensees). Daily Tasks (All Licensees) 1. Respond to APS support calls. Log contacts, respond or refer contact to APS Administrator(MPD), monitor resolution and ensure requester is contacted with resolution. Daily Tasks (Data Contributing Licensees) 1. Review upload activity from previous evening to ensure all Licensee's dealers submitted a transaction file. 2. Review administrator upload log for each store to assess whether file was successfully processed or not 3. Contact dealers who have not submitted transaction files or refer to Licensee's investigators/regulators for follow-up. 4. Review error history to ensure dealers are submitting corrections to previous transactions flagged as errors. 5. Perform random spot checks on uploaded data items using APS queries or reports to verify overall data quality. 6. Periodically run queries or reports on categories, items and brands where 'OTHER' is specified. 7. Work with Licensee's police and civilian investigators and regulators to ensure that ordinance- specified data reporting and quality is maintained. 8. Consult with Licensee's investigators/regulators on data quality issues to refer back to dealers for • resolution or additional training. • Monthly Tasks (Data Contributing Licensees) 1. Receive monthly billing invoice and data from APS administration and generate appropriate remittance. 2. Reconcile/assemble monthly billing data and generate an invoice for each dealer in Licensee's jurisdiction required to report to the APS Service (Data Contributing Licensees). As Required Tasks (All licensees) 1. Work with APS administration to identify enhancements, productivity tools,system bugs/inconsistencies so as to improve the service provided by APS. 2. Provide training to licensee's users. • • c:\winnt\profiles\hardymmO\desktop\agreement.doc 10 • City Council Agenda Item No. 10k Member introduced the following resolution and moved its adoption: RESOLUTION NO. • RESOLUTION RATIFYING ADVANCES TO COVER DEBT SERVICE IN TIF DISTRICT NO.2 WHEREAS; class rate changes adopted by the State of Minnesota reduced the net tax increment received in Tax Increment Financing District No. 2; and WHEREAS, the bond resolutions and pledge agreements adopted and approved at the time of issuance of bonds for TIF District No.2 obligated the City to pay debt service on the bonds if tax increments were insufficient and the pledge agreements provided that the City would be reimbursed from tax increments for any payments made to cover shortfalls in tax increments received and debt service payments due; and WHEREAS, during the years 2000 through 2003 the City advanced a net of$1,043,323 to cover shortfalls in increment needed to cover debt service; and WHEREAS, prior to 2000 there was due an owing for advances made in connection with TIF District No. 2 activities of$698,143;and WHEREAS, the bonds issued for TIF District No.2 have now been retired and the monies advanced can be repaid through increments generated in TIF District No. 2; and WHEREAS, the City wishes to ratify the required transfers and memorialize the amount to be repaid by virtue of the required advances to cover debt service. • NOW,THEREFORE,BE IT RESOLVED by the City Council of the City of Brooklyn Center that: 1) The sum of$1,043,323.63 advanced to cover shortfalls in debt service payments for TIF District No. 2 be and hereby is ratified and established in said amount to be repaid without interest from tax increments generated in Tax Increment District No. 2; 2) The sum of$698,143 advanced from other funds prior to 2000 in connection with TIF District No. 2 activities be and hereby is directed to be re-paid from TIF District No. 2 increments; and 3) The remaining fund balance in the sinking fund for the payment of the retired TIF District No.2 bonds be transferred to TIF District No.2 and applied to the repayment of advances made to TIF District No. 2. June 28, 2004 Date Mayor ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon,the following voted in favor thereof: • and the following voted against the same: whereupon said resolution was declared duly passed and adopted. 61 City of Brooklyn Center A Millennium Community MEMORANDUM TO: Mayor Kragness,Co YF) mo asman,Niesen, and Peppe FROM: Michael J. McCaule DATE: June 23, 2004 SUBJECT: Tax Increment Finant No. 2 Debt Servic e Shortfall As you are aware, when the Legislature reduced the tax capacity rates for commercial/industrial properties, TIF District No. 2 went from a position of slight surplus revenues over debt service payments to a position of shortfall. The City and Economic Development Authority were required to make the debt service on the TIF bonds that had been issued. Those bonds were issued for the Earle Brown Heritage Center restoration and street and streetscaping improvements. All of the debt service is now retired. The last payment occurred in the first part of 2004. The resolution ratifying advances to cover debt service in TIF District No. 2 formalizes the amounts of money that are to be • restored. The restoration will replace monies that were advanced from other funding sources. A net of$1,043,323 was advanced to cover debt service. Prior to 2000, $698,143 has been carried in the annual financial reports representing advances that occurred in connection with the development activities. There will be sufficient net tax increment proceeds from District No.2 to reimburse these monies. In 2003,net increment was approximately$800,000. This should result in repayment to the funds from which these monies had been advanced by the end of 2005 or the early part of 2006. The fund balance in the sinking fund for payment of the TIF District No. 2 bonds is approximately $590,000. 6301 Shingle Creek Parkway Recreation and Community Center Phone & TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall & TDD Number (763) 569-3300 FAX(763) 569-3434 FAX(763) 569-3494 www.cityofbrooklyncenter.org • City Council Agenda Item No. 101 • Member introduced the following resolution and moved its adoption: RESOLUTION NO. RESOLUTION AMENDING THE SCHEDULE FOR RENTAL DWELLING LICENSE FEES WHEREAS,the City Council of the City of Brooklyn Center adopted Resolution No. 2001-113 on August 13, 2001, which amended the fees to be charged for rental dwellings; and WHEREAS, the City Council has determined that it wishes to increase the fees for rental dwellings and establish a minimum fee for multiple-family dwellings to offset the expenses incurred by the City for rental inspection and prosecution services. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Brooklyn Center, Minnesota, to amend the City's fee schedule for rental dwelling licenses as follows: Rental Dwellings Biennial Fee Single Family Dwelling $375 Two Family Dwelling • First Rental Unit $375 Second Rental Unit $75 Multiple Family Dwelling Each Building $155 Each Unit $13 Minimum Base Fee $450 BE IT FURTHER RESOLVED by the City Council of the City of Brooklyn Center that this resolution shall be effective November 1, 2004. June 28, 2004 Date Mayor ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: • whereupon said resolution was declared duly passed and adopted. Office of the City Clerk OXCity of Brooklyn Center A Millennium Community MEMORANDUM TO: Michael J. McCauley, City Mana er FROM: Sharon Knutson, City Clerk DATE: June 23, 2004 SUBJECT: Resolution Amending the Schedule for Rental Dwelling License Fees At its May 10, 2004, Work Session, the City Council discussed the issue of rental housing license fees, which had been tabled from the March 8, 2004, Council meeting. A copy of the minutes from the Work Session is attached, along with the materials that were provided in the agenda packet. A resolution amending the rental dwelling license fees is also attached for Council consideration. Attachment 6301 Shingle Creek Parkway Recreation and Community Center Phone & TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall & TDD Number (763) 569-3300 FAX(763) 569-3434 FAX(763) 569-3494 www.cityofbrooklyncenter.org MINUTES OF THE PROCEEDINGS OF THE CITY COUNCIL • OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA CITY COUNCIL WORK SESSION MAY 10, 2004 CITY HALL - COUNCIL CHAMBERS CALL TO ORDER The Brooklyn Center City Council met in Work Session and was called to order by Mayor Myrna Kragness at 8:11 p.m. ROLL CALL Mayor Myrna Kragness, Councilmembers Kathleen Carmody,Kay Lasman,Diane Niesen,and Bob Peppe. Also present: City Manager Michael McCauley, Assistant City Manager/Director of Operations Curt Boganey, and Deputy City Clerk Maria Rosenbaum. Councilmember Diane Niesen left the meeting at 8:24 p.m. DISCUSSION OF PROCLAMATIONS • Councilmember Niesen expressed that she would like to see a template or overlay for Proclamations. Councilmember Lasman informed that three years ago the City Council reviewed the fashion for proclamations and that if there is anything that needs to be removed or added to a requested proclamation it could be done. Mayor Kragness suggested that if there is a proclamation that she would like amended to contact the City Manager. DISCUSSION OF DEVELOPMENT AGREEMENT DEFAULT WITH TALISMAN City Manager Michael McCauley informed that Brookdale had paid its 2003 taxes. The City received a copy of the check and a receipt from Hennepin County that included approximately $114,000 in penalty fees and approximately$3 8,000 in interest. Mr.McCauley informed that he had notified Mr. . Schlesinger n r that the 2004 i g 00 taxes would be due on May 15 2004. DISCUSSION OF TABLED RENTAL HOUSING LICENSE FEE SCHEDULE Councilmember Niesen expressed that she believes the rental fees should be raised. Councilmember Niesen left the meeting at 8:24 p.m. • 05/10/04 -1- Ci Ccgnc; I War Jess ark M;nu*s Council discussed the growth in single-family rental that results in increased and repetitive inspections. Councilmember Peppe expressed that he understands the costs involved and the reason to consider increased costs for rental properties, however, he does not want to penalize the good landlords. Mr. McCauley questioned if the Council would like to consider establishing a minimum fee for rental housing that reflects the substantial efforts required for single-family rental units. Councilmember Lasman expressed she believes with the trend of rental housing in the City something needs to be done to maintain the quality of our housing and neighborhoods. Councilmember Carmody discussed that she believes the P roblem is with homeowners not knowledgeable about renting properties and that the City should educate them more to make them realize that they need to manage the properties. Council discussed base fees for single-family and 4-unit complexes. Mr.McCauley suggested a base fee to be in business for a two-year period of$350 or $400. Councilmember Carmody expressed support for$300 per year. It was the consensus of the Council to have a fee structure started and have this item come back to the Council. • I MISCELLANEOUS i Council discussed the proclamation that was requested for Council approval from the GLBT Pride/Twin Cities. It was the consensus of the Council to pass on adopting the requested proclamation. ADJOURNMENT A motion by Councilmember Carmody, seconded by Councilmember Lasman to adjourn the Work Session at 8:38 p.m. Motion passed unanimously. City Clerk Mayor 05/10/04 -2- The following materials were included in the May 10, 2004, Work Session Agenda Packet City of Brooklyn Center A Millennium Community To: Mayor Kragness and uncil Members Carmody, Lasman,Niesen, and Peppe From: Michael J. McCauley City Manager Date: May 7, 2004 Re: Rental Housing License Fees As indicated in Mr. Hoffman's memorandum, the estimated annual cost of rental housing administration (including inspections, licensing, and oversight) is the range of$100,000 on the conservative end and $130,000 on the higher end. Examples of substantial use of staff time include the recently adopted rental housing ordinance. The police costs of monitoring and working with rental housing would easily support a total cost of administering rental housing beyond $130,000 per year. We are experiencing a growth in single family rentals that results in increased and repetitive inspections. The issue is that people are entering into a commercial venture who are not responding to corrective orders in as timely a fashion as many multi-family, • professionally managed properties (though we also find ourselves in very substantial enforcement efforts with poorly managed large complexes). Looking at an annual cost of inspection, enforcement, education, and administration in excess of$130,000, our annual revenue is in the range of$62,000 per year. That revenue is not even as licenses are on a 2 year cycle and one cycle has more units. Thus we receive $74,000 in one year and $50,000 in the other year of the 2 year cycle. The materials previously supplied are also attached. In the discussion on May 10`x', the Council may wish to consider a minimum fee for rental housing that reflects the substantial efforts required for single family rental units. That is, perhaps a $450 minimum license fee should apply to single family units. 6301 Shingle Creek Parkway Recreation and Community Center Phone & TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall & TDD Number (763) 569-3300 FAX(763) 569-3434 FAX(763) 569-3494 www.cityofbrookZyncenter.org MEMORANDUM TO: Michael McCauley, City Manager FROM: Brad Hoffman, Community Development Director DATE: April 30, 2004 SUBJECT: Rental License Inspections There are 76 apartment complexes (duplex and larger) in Brooklyn Center with a total of 3,357 units subject to the licensing requirements of Chapter 12. These numbers do not include the 224 single-family homes that are currently used as rental property. (Note that we are adding to the number of single-family rentals every week). With the notable exception of some apartment complexes, a typical rental inspection would cover the common areas and enough of the units to assure compliance with the ordinance. In some cases, a rental inspection would involve every unit if the history or field observations warranted that degree of inspection. In 2003, we would have inspected 37 complexes or 990 units plus 128 single-family rental inspections. While we do not tract follow up inspections, it is not unusual to have issued compliance orders that require follow up inspections. Single-family rental inspections are different. Unlike the complexes that are familiar with the ordinance and have representative on site, single-family owners renting their property tend to be less responsive to letters informing them of the license requirements and setting inspection dates and times. It has been our experience that single-family properties tend to require more inspections to achieve compliance than larger complexes. As an example, last year the 128 single-family rental properties required 406 inspections. Since the first of this year, 31 additional single-family homes have applied for a rental license, The vast majority of the new applications are Section 8 properties requiring an additional and different type of inspection. Last year we performed 511 Section 8 inspections. During even years, we inspect 39 complexes with 2,367 units and 96 single-family rentals. We anticipate that the number of single-family rental inspections will continue to grow. Rental inspection activity accounts for 20%to 23% of the inspections budget. Last year Rental license fees amounted to approximately $47,000. Based on last years budget, the activity • cost between approximately $59,000 and $67,500. This cost does not include clerical support which is funded under Planning. For the last 2 years, rental licensing has accounted for more than 50% of the department secretary's time. The department secretary spends significant amounts of time processing rental license application and coordinating inspection times. The application process is often burdened with uncooperative owners requiring numerous contacts by phone and mail. The cost of the administration of the rental license ordinance does not include front desk time, nor does it include my time. Rental properties, absent major enforcement efforts such as Summerchase, account for approximately 15% of my time especially with problem properties. The City's cost for the department secretary's time and mine is approximately $40,000. Finally, in any given year there will be a half dozen or more prosecutions for renting without a license, failure to make necessary repairs and so forth. Such costs are unaccounted for in these numbers. The actual cost of administering the rental license ordinance easily falls between $100,000 and $130,000 annually. In essence, the City of Brooklyn Center is subsidizing all rental units within the City. • • • adoption: Member introduced the following resolution and moved its RESOLUTION NO. RESOLUTION AMENDING THE SCHEDULE FOR RENTAL DWELLING LICENSE FEES WHEREAS,the City Council of the City of Brooklyn Center adopted Resolution No. 2001-113 on August 13, 2001, which amended the fees to be charged for rental dwellings; and WHEREAS,the City Council has determined that it wishes to establish a minimum fee for multiple family dwellings to offset the expenses incurred by the City for rental inspection and prosecution services. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Brooklyn Center, Minnesota, to amend the City's fee schedule for rental dwelling licenses as follows: Rental Dwellings Biennial Fee Multiple Family Dwelling Each Building $150 • Each Unit $10 Minimum Fee $450 Date Mayor ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. • Office of the City Clerk City of Brooklyn Center A Millennium Community • MEMORANDUM TO: Michael J. McCauley, City Manager FROM: Sharon Knutson, City Clerk DATE: February 12, 2004 SUBJECT: Rental License Fees In May 2001 the City Council reviewed and discussed rental license fees. In August 2001 the City Council adopted a resolution increasing rental dwelling license fees to offset the expenses incurred by the City for rental inspection and prosecution services. The new fees were effective in 2002. The biennial fee structure adopted in 2001 included two rates, one for single- and two-family dwellings ($150 per unit), and another for multiple family dwellings ($150/bldg., plus $10/unit). For many rental properties the current fee structure recovers the costs to the City for rental inspection. However, the multiple family dwellings in which there is one building with 14 or fewer units P ays a rental license fee • of $160 to $290, less than the two-family license fee of $300. Of the City's 68 multiple famil p Y dwellings, there are 41 complexes whose rental license fees are less than that of a two-fanZily dwelling. The license fee for these 41 multiple dwelling complexes does not cover the costs associated with providing rental inspection and prosecution services. A fee survey of other cities that license rental property has been completed and the results are attached. The fee structure varies by city, with some issuing annual licenses and others setting fees per unit only or charging flat rate fees per unit group. I've converted each city's data to a two-year g P o ear license fee in Y Y order to make an accurate comparison. The fee structure the City has established could remain the same, however, to cover the costs of City rental inspection services, a minimum rental license fee of$450 for multiple family dwellings could be established. The fee would generate approximately $10,000 of revenue to cover the inspection costs. I've attached a resolution that would amend the rental license fees and establish the minimum fee for multiple family dwellings. • 6301 Shingle Creek Parkway Recreation and Community Center Phone & TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall & TDD Number (763) 569-3300 FAX(763) 569.3434 FAX(763) 569-3494 Low w.cityofb rooklyncenter.org • Rental License Fee Comparison To Other Cities — February 2004 License Fee for Multi-Family Dwellings Brooklyn Center $150/bidg, plus $10/unit (Two-year fee OR $75/bldg, plus $5/unit Annually Brooklyn Park $165/1-14 units; $11/unit for 15+ units Annual Fee C stal $120/bldg, plus $5/unit Annual fee New Brighton $9.30/unit Annual fee Robbinsdale $200/3 unit; $250/4-12 units +$100; $15/unit for 13+ units (Two-year fee) OR $100/3 unit; $125/4-12 units +$50; $7.50/unit for 13+ units Annually TWO-YEAR RENTAL LICENSE FEES Brookl n Center com pared to two- ear cost for other cities Brooklyn Center Brooklyn Park _Crystal New Brighton Robbinsdale Single Family $150 $150 $200 No Fee $100 Two-Family $300 $300 $240 No Fee $175 1 Bldg w/3 Units $180 $330 $270 $55.80 $200 1 Bldg w/4 Units $190 $330 $2801 $74.40 $350 1 Bldg w/5 Units $200 $330 $290 $93.00 $350 1 Bldg w/6 Units $210 $330 $300 $111.60 $350 1 Bldg w/7 Units $220 $330 $310 $130.20 $350 1 Bldg w/8 Units $230 $330 $320 $148.80 $350 1 Bldg w/9 Units $240 $330 $330 $167.40 $350 • 1 Bldg w/10 Units $250 $330 $340 $186.00 $350 1 Bldg w/11 Units $260 $330 $350 $204.60 $350 1 Bldg w/12 Units $270 $330 $360 $223.20 $350 1 Bldg w/13 Units $280 $330 $370 $241.80 $365 1 Bldg w/14 Units $290 $330 $380 $260.40 $380 1 Bldg w/15 Units $300 $330 $390 $279.00 $395 1 Bldg w/16 Units $310 $352 $400 $297.60 $410 • Revenue Inc • rease With S450 Minimum License Fee For Multiple Family Dwellings # Of # 0 Rental License Total Rental Increase Bldgs Units Fee Under License Fee In Revenue $150/ $10i Current Total # Of Total Rental If $450 If$450 Bldg Unit Fee Structure Complexes License Fees Minimum Minimum 1 3 $180 11 $180 $450 $270 1 4 $190 19 $3,610 $8,550 $4,940 1 5 $200 1 $200 $450 $250 1 6 $210 2 $420 $900 $480 1 17 $220 3 $660 $1,350 $690 1 8 $230 1 $230 $450 $220 1 10 $250 1 $250 $450 $200 1 11 $250 9 $2,340 $4,0501 $1,710 1 12 $270 4 $1,080 $1,800 $720 1 18 $330 1 $330 $450 $120 1 22 1 $370 1 $370 $450 $80 1 24 $390 1 $390 $450 $60 2 8 $380 1 $380 $450 $70 45 Ila 440 1 510 • • • City Council Agenda Item No. lOm Member introduced the following resolution and moved • its adoption: RESOLUTION NO. RESOLUTION ORDERING THE CORRECTION OF HAZARDOUS CONDITIONS AND FURTHER FOR THE ABATEMENT OF PUBLIC NUISANCES, SAFETY, AND HEALTH HAZARDS WITH RESPECT TO THAT REAL ESTATE LOCATED AT 5025 EWING AVENUE NORTH, BROOKLYN CENTER, MINNESOTA 55430 LEGALLY DESCRIBED AS LOT 13, BLOCK 2, TWIN LAKE WOODS 2ND ADDITION, HENNEPIN COUNTY, MINNESOTA IN THE CITY OF BROOKLYN CENTER, HENNEPIN COUNTY, MINNESOTA WHEREAS, Minnesota Statutes § 463.15 et seq defines a hazardous building or hazardous property as any building or property which because of inadequate maintenance, dilapidation, physical damage, unsanitary condition or abandonment constitutes a fire hazard or hazard to the public safety or health; and WHEREAS, the correction of hazardous conditions and the abatement of public nuisances is necessary to protect the health, safety and welfare of the public by elimination of dangerous conditions, attractive nuisances and for the elimination of harborage for vermin, rats and other animals who may pose a danger to the public safety and health thereby providing for more sanitary and safe conditions and to further protect the integrity and desirability of neighborhoods; and WHEREAS, § 12-1101 and 12-1102 of the Ordinances of the City of Brooklyn Center provides that any building or portion thereof which is damaged, dilapidated or unsafe may be declared m p y may be declared unfit for human habitation and upon such declaration the owner thereof shall make the property safe P � and secure so that P P Y it is not hazardous to the health, welfare and/or safety of the public and does not constitute a public hazard; and WHEREAS, said single family dwelling has been the subject of prior inspection, in the year 2003, which inspection disclosed on the property, junk motor vehicles, rotting garbage, rubbish, debris and deterioration to the dwelling and outbuilding, on the basis of which the owner, Violet Brunner was prosecuted criminally and to which she entered a pleas of guilty in February 2004; • RESOLUTION NO. • WHEREAS, on 16 June 2004, under the aegis of a search warrant, Brooklyn Center police officers, the Building Official and others at their direction entered said single family dwelling and found extraordinary unsanitary conditions, including piles of rotting garbage,junk, debris, mold and mildew, the basement filled to a depth of approximately six feet with water and raw sewage and the dwelling is open to the elements in many places and further found in the yard, a large accumulation of rotting garbage, junk, temporary fencing, broken furniture, glass, cans, debris, two junk motor vehicles filled with rotting garbage and rubbish; and WHEREAS, said inspections have also revealed that the lean-to attached to the garage has rotted and the roof has partially collapsed and is unsafe and dilapidated; and WHEREAS, City Inspectors have concluded that the entire dwelling is not salvageable due to the sewage, water damage, mold, mildew, filth and deterioration; and WHEREAS, said property is said to be encumbered by a mortgage in favor • of Twin City Federal Savings and Loan and further a mortgage in favor of Frank Ronald Brunner; and WHEREAS, the City Council of the City of Brooklyn Center adopts the findings of the Building Inspectors and Building Official as to the hazardous conditions on said property and the dilapidation of and severe unsanitary conditions existing in and about the single family home thereon NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Brooklyn Center that: 1. The City Council finds that the single family dwelling at 5025 Ewing Avenue N. Brooklyn Center, Minnesota 55430 is a hazardous building because of extraordinary unsanitary conditions, including a large accumulation of rotting garbage, water and raw sewage to a depth of six feet in the basement, mold, mildew and deterioration to the dwelling's exterior and further that the yard contains two junk vehicles filled with rubbish and rotting garbage, and the yard further contains substantial piles of junk, refuse, garbage, junk furniture, dilapidated temporary fencing, glass, cans and debris and that the dwelling is partially open to the elements. • RESOLUTION NO. it • 2. The City Council finds that the condition of the premises at 5025 Ewing Avenue N. Brooklyn Center, Minnesota 55430 constitutes a hazardous property and a public nuisance within the meaning of Minnesota Statutes § 463 and Brooklyn Center Ordinances Chapter 12 by reason of the aforesaid reasons. 3. The abatement of the public nuisances and hazardous conditions at said premises is hereby ordered by the City Council of the City of Brooklyn Center as follows: Razing and removal of the damaged and unsanitary home and all damaged structures thereon, removal of the foundation and filling of the excavation to grade with clean fill and disconnection of all utility lines and complete removal of all garbage, debris, trash, refuse, rubbish, cans, glass, broken furniture and the like, The City Manager is hereby authorized to cause and carry out the abatement described • herein and to perform all other tasks and functions reasonably incident thereto and to keep an accurate record of the cost of all actions and proceedings herein, including administrative time, attorney's fees, costs and disbursements, and all other costs of the enforcement of this Order, and to send a statement of such costs to the landowners and occupants who are directed herewith to pay the same. June 28, 2004 Date Mayor ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. • ORDER FOR THE RAZING AND REMOVAL OF A • HAZARDOUS BUILDING EXISTING AT 5025 EWING AVENUE NORTH, BROOKLYN CENTER, MINNESOTA 55430 The City Council of the City of Brooklyn Center, Minnesota, pursuant to Resolution No. ,herewith orders Violet Wanda Brunner to raze and remove that single family dwelling at 5025 Ewing Avenue North,Brooklyn Center, Hennepin County, Minnesota, legally described as Lot 1 Block 2 Twin Lake Woods 2d Addition, which has been declared to be a hazardous building and hazardous property within the meaning of Minn. Stat. Chapter 463.15 et seq and to fully abate all nuisances thereon and to further fully comply with said City Council Resolution within fifteen (15)days from the date of service of this Order upon you. If there is no compliance with this Order, a Motion for summary enforcement of this Order shall be made to the Hennepin County District • Court unless an Answer is filed herein within twenty(20) days of the date of service of this Order upon said parties pursuant to Minnesota Statute §463.18. If no compliance with this Order shall have taken place or no Answer contesting this action filed herein or if such Answer is filed and the Court orders the enforcement of this Order, then the City of Brooklyn Center shall cause the building to be razed and removed pursuant to Minnesota Statute§463.21 with all costs of repair,razing,correction and removal,including attorney's fees and administrative costs,to be a lien against the real estate on which said building was located, said lien to be levied and collected only as a special assessment in the manner provided by Minnesota Statutes Chapter 429 and the provision of Minnesota Statute §463.161. • • CITY OF BROOKLYN CENTER Dated: 2004 Michael McCauley, City Manager • • 2 GARSON, GLELLAND Se SGHIPEDEI, ATTOSNEYS AT LAW • PROFESSIONAL LIMITED LIABILITY PARTNERSHIP JEFFREY A. CARSON 6300 SHINGLE CREEK PARKWAY, SUITE 305 TELEPHONE WILLIAM G. CLELLAND (763) 561-2800 ELLEN M. SCHREDER MINNEAPOLIS, MINNESOTA 55430-2 190 FAX DAVID K. ROSS - (763) 561-1943 ANNA KRAUSE CRABB 23 June 2004 Michael McCauley City Manager Brad Hoffinan Community Development Driector City of Brooklyn Center 6301 Shingle Creek Parkway Brooklyn Center, Minnesota 55430 Re: 5025 Ewing N. Violet Brunner • Gentlemen, I enclose an original resolution and proposed order for council consideration. I suggest you attach the police and inspection reports and a representative number of photos to further edify the conditions at the home. After the council approves the resolution, please send me a copy of the resolution and the original order and I will cause service upon the interested parties and proceed with all deliberate speed. Sincerely, CARSON, CLELLAND & SCHREDER William G. Clelland enc • • Date: 6/17/2004 To: File From: Brad Hoffman RE: Personal Observations of Subject Property 5025 Ewing Ave No Yesterday, the 15th of June, 2004, the Brooklyn Center Building Official enter the house at 5025 Ewing with a warrant for purposes of determining the habitability of the home. I had received complaints from a neighbor about the condition and the smell from the property. I personally observed the same conditions including the presence of rodents and the smell from the house on June 7, 2004. Larry Martin the Building Official entered the property via the kitchen door. He was only able to partially open the door because of all of the rubbish and clutter in the home. It was physically impossible to completely open the door. He observed and photographed the conditions he observed including water and sewage in the basement. The photos • indicated that the water was at the bottom of the floor joists. He was concerned that the foundation could collapse from the water pressure. I had the water to the house as well as other utilities turned off as of the June 15th. Debra Anderson from the Hennepin County Health Department was contacted by Sharon Knutson, City Clerk, and was told by Ms. Anderson that the presence of raw sewage in the basement constituted an imminent threat to health. The Hennepin County Health Department was contacted on 6/16/2004. 1 had a pump ordered a pump truck to pump the water and sewage from the basement on the 16th. 1 met Becky Boie, the Neighborhood Liaison Officer at the site at 10:00 A.M. We were there to meet the driver of the pumping facilities gain access to the house. We discovered that the house had been locked up. It was not locked at the time of the execution of the search warrant. Further, a placard declaring the building unfit for human habitation had been removed. I spoke with City Attorney Bill Clelland about the situation, advising him that the house had been locked. He advised me that given the imminent threat to health and the potential of the collapse the walls we could use forced entry un the provisions of Chapter 7. At that time, I requested Officers Rognstad and Messienbrink to gain entry.Again, we were only able to partially open the door so we broke the basement window to pump from that vantage point. When the window was broken, I could observe that the • ti6/17/2004 Confidential 1 a 6/17/2004 Personal Observations of Subject Property 2 • basement was filled with rubbish and debris that had obviously been wet. However, the basement was no longer flooded. I then looked inside the home as best as I could and did observe the watermarks on the stairways leading to the basement. At that time I requested some additional photos of the site be taken and informed John Kopet of A-Northern Cesspool that we would not need to have the house pumped. I also observed an extremely cluttered kitchen, basement and a small part of the living room. It was so filled with trash and rubbish that physical entry was very difficult. Further the odor from the house was extremely strong.. It could be observed prior to gaining entry but even more some once the door and window had been opened. I have ordered the building boarded up because of the extremely filthy conditions of the house and the potential threat to health that exists. gbh • • 6/17/2004 Confidential 2 Brooklyn Center Police Department Case # 04_11540 MN0270200 ' NARRATIVE/SUPPLEMENTAL REPORT Incident Rules &Regulations Date/Time Report blade 6/17/04 1205 Reporting Officer B. Boie FN Reviewed by Assigned To Reference Other Case# Typist Complainant Name DOB/ Hoffman, Brad on file Address 6301 Shingle Creek Parkway City/state/zip Brooklyn CAkN 55430 DISPOSITION: Arrest Pending Inactive Unfounded Exceptionally Cleared (Adult or Juvenile) NARRATIVE (Additional Details of Offense,Progress Of Investigation,etc.) On June 16, 2004, I, Becky Boie,Neighborhood Liaison Officer with the Brooklyn Center Police Department was informed by Rebecca Crass, Community Development Secretary, on the approval from the Brooklyn Center City Manager, Michael McCauley, that I would be needed at the house located at 5025 Ewing Ave North,Brooklyn Center on 6/17/2004 to meet a party from a sewer drainage service at 10:00 for the purpose of draining the basement of sewage. At 0955 I arrived at the address of 5025 Ewing Avenue to assist with entry into the house for the purpose of draining the raw sewage that had been discovered on June 16, 2004 by Building Official, Larry Martin, Lt. Curt Lund, and Oy self during the execution of a search warrant(refer to Lt Lund's report for details). At 1000, Brad Hoffinan, Community Development Specialist, arrived to assist with the sewer company dispensing the raw sewage. At 1010, John Kopet arrived from A-Northern Cesspool sewer service to pump the raw sewage from the basement that had been discovered on 6/16/2004. Brad Hoffman did attempt to make entry into the house by opening the door located on the south side of the house. Hoffman discovered that the door had been locked and was unable to gain entry into the home. At that time Hoffman contacted Brooklyn Center City Attorney, William Clellan for the purpose of obtaining to permission to gain access to the house by using a forceful entry. Attorney Clellan granted permission to Hoffinan for the use of force into the home. At that time I contacted the Brooklyn Center Police Dispatch to send an officer for assistance gaining entry into the home. Officer Clark Messenbrink arrived at the scene at 1017, Officer Chris Rognstad arrived at the same time. Officer Rognstad kicked the side door open to gain entry into the house. The door would not open far enough for the sewage company to properly drain the basement. A basement window was located directly adjacent to the side door slightly concealed by a Styrofoam substance over the window. Officer Messenbrink removed the Styrofoam substance and broke the window out using his flashlight. It should be noted that two mice were found, alive, exiting the Styrofoam as Officer Messenbrink was removing it. The raw sewage that had been witnessed by Lt. Lund, NLO Boie, and Building Official Larry Martin was not seen at is time. Watermarks and an offensive odor were clearly evident upon entering the home. Photographs of the water es and large quantity of junk and debris were taken. Hoffman then made dismissed the A-Northern Cesspool employee and contacted another City employee to board up the side door and window. Hoffinan stated that the rest of the home would be boarded up on 6/18/2004. 04-11540 should be note in this report for informational purpose only, a neighbor had contacted me on 6/17/04 via tl P p � Y, g 1e phone and informed me that the homeowner, Violet Brunner, had been seen on the property on 6/16/2004 sometime in the afternoon picking up her mail. A short time after she had left the property, the neighbors discovered that the "Unfit for Human Habitation" sign was no longer posted on the house where Building Official,Larry Martin had placed it on 6/26/2004. There are no independent witnesses to the actual removal of the posted sign. bb • • Brooklyn Center Police Department Case# 04-11540 MN027020.0 le Incident • Offense Code I Offense Code 2 INCIDENT REPORT Offense Code3 Offense Code 4 Location 5025 Ewing Avenue North ��`�/s`at �p Brooklyn Center,MN Date Committed 06-09-04 Time Committed 1300 Date Reported Time Reported 06-09-04 1300 Date/Time Report Made 06-11-04 1115 Reporting Officer Lund Reviewed By/Date Assigned To Reference Other Case Transcriptionist CAL DISPOSITION Arrest Pending Inactive Unfounded Exceptionally Cleared (Adult or Juvenile) s Juv Last Name,First,Middle DOB/ C Koffman, Brad Address ty/State/Zip r 6301 Shingle Creek Parkway Brooklyn Center,MN 55430 Home Phone Work Phone Sex Race 763-569-3330 M W Other City Community Development Director Juv Last Name,First,Middle DOB/ ddress City/State/Zip Home Phone Work Phone Sex Race Other Last Name,First,Middle 7703-30-27 Brunner, Violet Wanda Address City/State/Zip 5025 Ewing Avenue North Brooklyn Center, MN 55429 Phone(H) Phone(W) AKA's Sex F Race W Ht Wt Build Hair Eyes Last Name,First,Middle 7 B/ Address City/State/Zip Phone(H) Phone(W) AKA's Sex Race Ht Wt Build Hair Eyes License# Year State Make/Model/ Style (con[) 1e M Color Veh Impounded(Y/N) Veh Involved In Accident(Y/N) j W Property Sheet(YIN) Crime Lab(Y/N) Technician Prints? Photos? Y Other =Total ue of Loss: 04-11540 Page 2 On Wednesday, 06-09-04, Lt. Curtis Lund was contacted by Brad Hoffman, Community Development Director for the City of Brooklyn Center,regarding the single family dwelling located at 5025 Ewing Avenue North in the City of Brooklyn Center. Brad Hoff-man told Lund that a City assessor had contacted him after having stopped at 5025 Ewing Avenue North in an attempt to assess the property and reported a strong odor described as rotting garbage emitting from inside the house. Brad Hoffinan told Lund that he sent a City building inspector to the house and the building inspector returned also reported a strong foul odor emitting from the interior of the house. Brad Hoffman stated that the building inspector in talking to neighbors was told that the owner of the house,Violet Brunner, did not live there but would stop by a couple of times during the week to pick up the mail. The building inspector was also told by neighbors that they had seen mice crawling on the window curtains/shades,mice running along the curtain rods, squirrels going in and out of the house through holes in the side of the house, and birds flying in and out of holes in the siding of the house. Brad Hoffman stated that he was concerned that the interior of the house may be cluttered or filled with rubbish or garbage leading to an infestation of vermin or rodents. Brad Hoffman asked for Lund's assistance in obtaining a search warrant to enter the house. Lund was familiar with the address and the owner, as Lund has been involved in the investigation • of City ordinance violations at this address for the last year. The property owner, Violet Brunner, has been charged repeatedly by formal complaint with a variety of ordinance violations of which Violet Brunner never complied to the Courts repeated orders to clean the property up. Lund drafted a search warrant on his knowledge of the prior contacts with this property and the new information obtained from Brad Hoffmann. On Friday morning, 06-11-04, Lund presented the search warrant to Hennepin County District Court Judge Allen Oleisky who after review signed the search warrant authorizing Lund, officers under his direction and control, and City of Brooklyn Center Building Inspection Officials to enter and search the single family dwelling, curtilage, and all sheds or make-shift storage structures located on the curtilage. • APPLICATION 1-1 STATE OF MINNESOTA, COUNTY OF HENNEPIN DISTRICT COURT • STATE OF MINNESOTA ) APPLICATION FOR SEARCH WARRANT AND SS: SUPPORTING AFFIDAVIT COUNTY OF HENNEPIN ) Curtis Lund being first duly sworn upon oath, hereby makes a pp lication to this Court for a warrant to search the (premises)(metet"vehide)(perserr)hereinafter described,for the property and things hereinafter described. Affiant knows the contents of this application and supporting affidavit, and the statements herein are true to the affiant's own knowledge, save as to such as are herein stated on information and belief, and as to those, affiant believes them to be true. Affiant has good reason to believe, and does believe,that the following described property and things,to wit: Rubbish consisting of both combustible and non combustible solid waste, including but not limited to: paper, cardboard, cans, grass and shrubbery clippings, wood, glass, bedding, buckets, barrels, and similiar materials. Garabage including but not limited to: animal and vegetable wastes resulting from the handling, preparation, cooking, and consumption of food. Rodent harborage/infestation, including but not limited to: any place where rodents are or can live, nest, or seek shelter. • Documents, receipts, bills, letters, and identification to show constructive possession of the premise. Authorization to photograph the premise, curtilage, and all garages, sheds, or makeshift storage structures on the curtilage and their contents. Authorization for City of Brooklyn Center Building Inspection Officials to enter the premise and curtilage to assist in the inspection of City Building Maintenance, Occupancy, Health and Safety Ordinance compliance. (are) (will be) (at the premises)(' )(on-We-per m)described as: 5025 Ewing Avenue North, Brooklyn Center, MN 55429 to include any or all garages, sheds, or makeshift storage structures on the curtilage. Located in the City of Brooklyn Center, County of HENNEPIN, and State of Minnesota. This affiant applies for issuance of a search warrant upon the following grounds: 1. The property above deseFibed was stolen oF embezzled. 2. The property above described was used as means of committing a crime. • 3 4. The property above described is in the possession of a person with intent to use such property as a means of committing a crime. 5. The property above described constitutes evidence,which tends to show a crime has been committed, or tends to show that a particular person has committed a crime. Application 1-2 he facts tending to establish the foregoing grounds for issuance of a search warrant are as follows: Your affiant, Curtis Lund, is a licensed peace officer in the State of Minnesota and is employed as a Lieutenant by the Brooklyn Center Police Department. Your affiant while employed by the Brooklyn Center Police Department has worked as a patrol officer, detective, and sergeant during which your affiant has received specialized training and experience in the detection and investigation of crimes occurring within the City of Brooklyn Center. Your"affiant in his current capacity is responsible for the enforcement of City ordinances established to protect the public health, safety, and the general welfare of the people of the City. Your affiant has a working knowledge of these City ordinances, works closely with City building officials, and supervises police Neighborhood Liaison Officers (NLO's) who investigate allegations of City ordinance violations, commonly referred to as Code violations. Your affiant has conducted an investigation into the facts and circumstances contained here-in and believes them to be true. Your affiant, over the last year, has been involved in the investigation of City ordinance violations occurring at the single-family dwelling and its surrounding curtilage located at 5025 Ewing Avenue North in the City of Brooklyn Center. The property owner and resident of 5025 Ewing Avenue North has been identified through the City of Brooklyn Center Assessing office and in personal contacts, on premise,by NLO's Matt Koncar and Rebbecca Boie as Violet Wanda Brunner dob/03-30-27. The City ordinance violation investigation was initiated by neighbors complaining of junk cars, garbage and rubbish piled in the backyard, a noxious odor tting from the property, and the premise in disrepair. NLO's Koncar and Boie in investigating the complaint observed an unlicensed vehicle parked in the driveway, a pile of garbage that totally buried a small pickup truck parked in the backyard, a lean-to shed off the back of the unattached garage that had collapsed, shingles missing from both the garage and house roofs. The siding, soffit, and fascia on the house had numerous holes burrowed in them from which birds and bees could be seen flying in and out of. NLO Koncar and Boie's observation were violations of Brooklyn Center City ordinances relating to Garbage storage and removal 7-102, Improper storage of garbage and Accumulation of rubbish 19-103, Exterior walls and roof disrepair 12-702, Collapsed accessory building 12-707, and Failure to obtain services of a refuse collector 7-102. The property owner and resident,Violet Brunner,was notified by mail and in person of the violations and given time in which to bring the violations into compliance with City ordinance. Violet Brunner admitted to NLO Koncar that she did not have a refuse collection service. Violet Brunner did not comply and has refused any offers of help to bring her premise into compliance. Violet Brunner has been charged repeatedly by formal complaint with the City ordinance violations. Violet Brunner has appeared in Hennepin County District Court where she was ordered to comply with the City ordinances. Violet Brunner to date has failed to remedy the situation and comply with City ordinance. • Application 1-2a Wednesday, 06-09-04, Lt. Lund was contacted by Brad Hoffman, City of Brooklyn Center Community Development Director, and told that a City assessor had stopped at 5025 Ewing Avenue North for tax assessing purposes. The assessor was unable to make contact with anyone at_the house but smelled and reported a strong odor of rotting garbage emitting from the house. Ed Lovelace, a City building inspector,was sent to investigate finding the premise and curtilage to be in the same condition of disrepair as earlier documented and smelled what he described as a strong odor of rotting garbage emitting from the premise. Ed Lovelace in contacting neighbors was told that Violet Brunner does not currently live in the house but stops by once or twice a week. One neighbor told Ed Lovelace that mice have been seen climbing the curtains inside the house and running along the curtain rods with birds being seen flying in and out of the holes burrowed in the exterior walls. Your affiant, based on the above, believes that the interior of the described premise, garage, sheds and makeshift storage structures that may be found on the curtilage are filled with garbage and rubbish which would account for the strong odor of rotting garbage emitting from the premise. Your affiant, based on the above, believes that the holes in the exterior of the premise have made it possible for rodents to gain access to the on the above believes t a vermin and/or rodent infestation. Your affiant based interior of the premise leading o , that the garbage and rubbish accumulated on the curtilage provides the setting for a vermin and/or rodent infestation of the neighborhood. Your affiant, based on the above, believes that the accumulation of garbage and rubbish at the described premise constitutes a public health, safety, and welfare risk or danger for the people of the City of Brooklyn Center. t t search and document b photographs as evidence the items as described in the affiant seeks this warrant o y eour search warrant. • APPLICATION 1-3 A nighttime search outside the hours between 7:00 AM and 8:00 PM is necessary to prevent the loss, destruction • or removal of the objects of the search or to protect the searchers or the public because: N/A An unannounced entry s necessary to prevent the loss destruction or removal of the objects of the search ry ry p o � and to protect the safety of the peace officers because: N/A WHEREFORE,Affiant requests a search warrant be issued,commanding Lt. Curtis Lund,and all other officers under their direction and control, peace officers, of the State of Minnesota, ( ) (between the hours of 7:00 AM and 8:00 PM onl the hours of 7:00 AM and 8:00 PM or a nighttirne se outside these houFs) to search the hereinbefore described (premises)(motor vehicle)(person) for the described property and things and to seize said property and things and keep said property and things in custody until the same be dealt with according to law. • Affiant Subscribed and sworn to before me this day of �$ �� 2004. / tt Judge of District Court ALLEN OLEISKY JUDGE OF DISTRICT COURT • SEARCH WARRANT 2-1 STATE OF MINNESOTA, COUNTY OF HENNEPIN DISTRICT COURT • TO: Curtis Lund, and all other officers under his direction and control, PEACE OFFICERS OF THE STATE OF MINNESOTA. WHEREAS, Curtis Lund has this day on oath, made application to the said Court applying for issuance of a search warrant to search the following described (premises)(ntater-vebiele) (person): 5025 Ewing Avenue North, Brooklyn Center, MN 55429 to include any or all garages, sheds, or makeshift storage structures on the curtilage. Irocated in the City of Brooklyn Center, County of HENNEPIN, STATE OF MINNESOTA for the following described property and things: Rubbish consisting of both combustible and non combustible solid waste, including but not limited to: paper, cardboard, cans, grass and shrubbery clippings, wood, glass, bedding, buckets, barrels, and similiar materials. Garabage including ut not limited to: animal and 9 vegetable wastes resulting from the handling, preparation, cooking, and consumption of food. Rodent harborage/infestation,including but not limited to: any place where rodents are or can live, nest, or seek shelter. Documents, receipts, bills, letters, and identification to show constructive possession of the • premise. Authorization to photograph the premise, curtilage, and all garages, sheds, or makeshift storage structures on the curtilage and their contents. Authorization for City of Brooklyn Center Building Inspection Officials to enter the premise and curtilage to assist in the inspection of City Building Maintenance, Occupancy, Health and Safety Ordinance compliance. WHEREAS, the application and supporting affidavit of Curtis Lund (was)(were)duly presented and read by the Court,and being fully advised in the premises. NOW,THEREFORE,the Court finds that probable cause exists for the issuance of a search warrant upon the following grounds: 1. The property above deseFibed was stolen or embezzled. 2. The property above described was used as a means of committing a crime. 3. 4. The property above described is in the possession of a person with intent to use such property as a means of committing a crime. 5. The property above described constitutes evidence,which tends to show a crime has been committed,or tends to show that a particular person has committed a crime. The Court further finds that probable cause exists to believe that the above-described property and things (are) (will be) (at the above-described premises)(• )(on the pe t) • The Gourt further fends that entilly without annou 3se is necesse, *to pr vent the' bjects of said search,or to protect the searchers OF the public. objeet of said search and to protect the safety of the , • NOW, THEREFORE,YOU, Curtis Lund AND ALL OTHER OFFICERS UNDER THEIR DIRECTION AND CONTROL,THE PEACE OFFICER(S)AFORESAID,ARE HEREBY COMMANDED (TP) ENTER`",IT' 'GUT AAIAI/1I P4GEMEP4T E)F AI ITL-iE)"]IT/ A NIr1 Pfl RP E) )(BETWEEN THE HOURS OF 7:00 AM AND 8:00 PM ONLY) /'1I YI V V )TO SEARCH (THE DESCRIBED PREMISES) )(T''E PERSG I OF) FOR THE ABOVE-DESCRIBED PROPERTY AND THINGS,AND TO SEIZE SAID PROPERTY AND THINGS AND TO .RETAIN THEM IN CUSTODY SUBJECT TO COURT ORDER AND ACCORDING TO LAW. BY THE COURT: Dated'T'^--_L 2004. 7 0 JUDGE OF DISTRICT COURT ALLEN OLEISKY JUDGE OF DISTRICT COURT • RECEIPT, INVENTORY,AND RETURN 3-1 STATE OF MINNESOTA, COUNTY O F ,/7G�^ �� �L T COURT • /. RECEIPT,INVENTORY AND RETURN received the attached search warrant �� d�C sl�c/ rl issued by the Honorable - ,on ,20_6Z,and have executed it as f,)flows: /I Pursuant to said warrant,on ,20 at ©�3�ro'clockl7 m., I searched the (premises) (meta cle) (pemoA) described in said warrant, and left a true and correct copy of said ,warrant AJ ( took into custody the property and things listed below: (attach and identify additional sheet if necessary) J"�7Z)f�r�/}�iy� �J�TEf�G�r� �s•.>T�r/l�c7sQ d� /�i�G�r%rsG�" .*��.d • (Strike when appropriate:) I left a receipt for the property and things listed above with a copy of the warrant. NeFTP-ef warrant wPra fn tnd, 11 all (retain) or (dekaeer) custody of said property as directed by Court order. '- 'A 7Z5- �ti, being first duly sworn,upon path,deposes and says that he has read the foregoing receipt, inventory and return and the matters stated are true and correct,except as to such matters stated therein on information and belief,and as to those,he believes them to be true. Subscribed a sworn to befor me this day a ,2.�J ,20t' r / otary ublic, County, Min— �' F .,�.,�.� Signature JILL A.LUNDs J�% *8,' NOTARY PUBLIC—A9pdNE$OZq My commission expires N;Y COMMISSION EXPIRES JANUARY 31, rrnl l"'r - WMITE COPY • PROS. ATTY. -YELLOW COPY •PE.ACE OFFICER -PINK COPT 7 '}DEMISES/PERSON -GOLD COPY. Brooklyn Center Police Department Case # 04_11540 MN0270200 ARRATIVE/SUPPLEMENTAL REPORT Incident Date/Time Report Made 6/16/04 1805 Reporting Officer Lund Reviewed by Assigned To Reference Other Case# Typist cal Complainant Name HOFFMANN, Brad DOB/ Address City/State/Zip 6301 Shingle Creek Parkway Brooklyn Center,MN55430 DISPOSITION: Arrest Pending Inactive Unfounded Exceptionally Cleared (Adult or Juvenile) NARRATIVE (Additional Details of Offense,Progress Of Investigation,etc.) On Wednesday morning, 06-16-04, at 0835 hours, Lt. Curtis Lund executed the search warrant at 5025 Ewing Avenue North. Larry Martin, City of Brooklyn Center Building Offical, and Rebecca Boie,Neighborhood Liaison Officer assisted Lund. Lund knocked repeated on both the front and back door of the house announcing his presence and that he had a search warrant for the house. Lund while standing outside both the front and back door of the hous smelled a strong foul odor emitting from inside the house. Lund did not receive any replies to his knocks and announcement at either door. Lund in checking found both the front and back doors locked. Wd forced the back door, located on the south side of the house, open. Lund was only able to push this door open roximately 15 inches due to rubbish, garbage,boxes, and other junk piled up behind it. The back door opened into the kitchen area of the house. Lund would have been able to squeeze through the door to enter the house but there was junk, garbage, and rubbish piled 5 to 6 feet tall through out the kitchen making virtually impossible to enter. Lund in sticking his head inside the back door was able to see down the basement steps. Lund saw boxes, clothes, garbage, and rubbage floating in five to six feet of raw sewage, the origin of the strong odor that was smelle( outside the house. Lund then went to the front door of the house and forced it open. Lund was only able to push the front door open six to eight inches due to the junk, rubbish, and garbage piled up behind it. The front door opened into the living room area of the house. As far as one could see into the house it was piled five to six feet with junk, rubbish, and garbage. The curtilage of the property contained a 2-stall unattached garage that was filled floor to ceiling and wall to wall with junk, rubbish, and garbage. At the rear of the garage was a wooden lean to that had rotted and fallen on top of more garbage. There were two vehicles, a Mercury Cougar MN License EBX-731 and a Mitsibushi pickup MN License EBX-732 parked on the property both of which were packed full of junk, rubbish, and garbage. The backyard had piles of garbage, rubbish, and refuses piled and spread all about. The house and cartilage were photographed to document Lund's observations. Lund left a copy of the search warran and accompanying receipt inside the backdoor of the house. Building Official Larry Marten posted the house as Uninhabitable. of Brooklyn Center building inspections will be continuing the investigation into possible abatement and/or ondemnation proceedings. Lund is closing this case as EXC. CLEARED. l� 204 02/DSB I N C I D E N T BP: 1 • (000) SUCCESSFUL COMPLETION COMMAND:3204 f AD: C•_ R• INFO: TY: BT: PD: FD: CN: MG: UD: H• RP: RA' PH: RT_ PRI: DC: U: DT: ET: AT: CT: CRO: DISP: REC: FC: P:00 MSG: 8387132 FOR: 204 TIME: 08:52 204 QMW LIC/EBX731 .LIS/MN.L ------------------------------------------------------------------------------- TXT LIC/EBX731 . LIY/04. LIT/PC. NAM/BRUNNER,VIOLET WANDA.*RECORD DISSEMINATION RESTRICTED* SNM/STAR RT 1 BX 89F. CTY/PINE CITY. STA/MN. ZIP/55063. VIN/1MEBP92F4EH700458. VYR 184. VMA/MERC. VCO/BLK. VMO/COUGAR,2DR SEDAN EXM/DEC. DOB/19270330. STICKER:D2627088. 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K rawer, Y AM" � � �� s q m ZF R o, v i w a yy _w , .3� .� �,�. � � 1_, �_, - �, = ,fir �� 'k♦ � � r tom? ` AGENDA CITY COUNCIL WORK SESSION June 28, 2004 Immediately Following Regular City Council Meeting at 7:00 P.M City Council Chambers 1. Brookdale real estate tax delinquency 2. Real Estate taxes and City licenses 3. Miscellaneous 4. Adjourn City of Brooklyn Center A Millennium Community To: Mayor Kragness and Council Members Carmody, Lasman,Niesen, and Peppe From: Michael J. McCaule City Manager Date: June 23, 2004 Re: Brookdale Real Estate Tax Delinquency This item is on the agenda for discussion whether the EDA wishes to consider a new notice of default to Talisman Brookdale. Last year a notice of default under the development agreement was sent to Talisman Brookdale. Payment of the 2003 taxes cured that default. The current delinquency is a new default. 6301 Shingle Creek Parkway Recreation and Community Center Phone & TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall& TDD Number(763) 569-3300 FAX(763) 569-3434 FAX(763) 569-3494 www.cityolbrooklyncenter.org City of Brooklyn Center A Millennium Community To: Mayor Kragness and Council Members Carmody, Lasman,Niesen, and Peppe From: Michael J. McCaul City Manager Ir, Date: June 23,2004 Re: Licenses The City Council reviewed the question of whether the requirement that real estate taxes be paid as a condition of licensure should be extended beyond those licenses for which payment of real estate taxes is a condition precedent to licensure. The Council requested additional information on the activities that are licensed by the City and the rationale behind licensing. Ms. Knutson and I have prepared the following list and description. The matter is placed on the Work Session Agenda for continued Council discussion of whether real estate tax payment should be a requirement for more types of licenses. The areas of most interest would be rental housing licensure. In that regard, discussion is also sought on whether payment of utility charges should also be a condition of rental housing licensure since utilities are necessary to operate sanitary housing. Chapter 11 regulates liquor licensing and requires that real estate taxes be paid prior to the issuance of a liquor license. Other types of licenses that require that real estate taxes be paid prior to the issuance are pawnbrokers, secondhand goods dealers, motor vehicle dealerships, and tattoo and body piercing establishments. The City licenses the following types of businesses or activities: • Amusement Device • Bowling Alley • Christmas Tree Sales • Coin-Operated and Self-Service Dry Cleaning Machines • Commercial Kennel • Fireworks Sales • Garbage Collection Vehicle • Gasoline Service Station • Liquor • Massage Parlor • Mechanical • Motor Vehicle Dealership • Pawnbroker • Public Dancing 6301 Shingle Creek Parkway Recreation and Communit y Center Phone & TDD Number Brooklyn Center, MN 55430-2199 (763) 569-3400 City Hall & TDD Number(763) 569-3300 FAX(763) 569-3434 FAX(763)569-3494 www.cityolbrooklyncenter.org • Rap Parlors, Conversation Parlors, Adult Encounter Groups, Adult Sensitivity Groups, Escort Services, Model Services, Dancing Services, or Hostess Services • Rental Dwellings • Saunas or Sauna Baths • Secondhand Goods Dealer • Sign Hanger • Tattoo and Body Piercing Establishments • Tobacco Related Products Some of the rationale behind the licensing activities: • Amusement Device o This enables the Council to keep in check the number and various kinds of devices in operation and regulates that they are not gambling devices that provide payoffs other than free games, which would be illegal gambling. Proof of insurance is required to cover any safety issues related to the operation of amusement devices (i.e., small child is injured on carousel kiddie ride). Other safety issues include ensuring that the location of the devices does not block exits or fire doors. • Bowling Alley o This is a place of entertainment and amusement and due to the nature of this type of activity, it could damage the public or degenerate into a nuisance (i.e., loitering, crowds of kids, illegal activities). City regulation assists to protect he general welfare of the community. • Christmas Tree Sales o This is a transient activity that is regulated as to appropriate zones. Licensing assists in having the applicable zoning permits and regulatory compliance. This also provides identification for follow-up for this transient activity and provides some sense that such identification will reduce potential illegal activities such as selling stolen trees. Also helps to ensure that the site is cleaned up after the sale. • Coin-Operated and Self-Service Dry Cleaning Machines o This type of business is regulated for building and ventilation requirements for safety issues related to solvents used in the machines. • Commercial Kennel o This type of business is regulated as to appropriate zoning districts, as well as sanitary requirements. It also provides standards for proper care of the animals. • Fireworks Sales o This is another transient activity that is regulated as to location. There are also safety issues that licensing furthers by requiring the license holder to obtain a license and for us to be able to control sales to those persons eligible for licensure. Again identification of who is selling in this transient fashion is some deterrence to the sale of stolen property and to operating without the permission of the landowner in the case of outdoor sales. • Garbage Collection Vehicle o Collection vehicle licensing is a means of insuring that qualified haulers with appropriate insurance are operating and disposing of waste appropriately. Hours of operation can be regulated, as well as safe operation of the vehicles. • Gasoline Service Station • This type of business is regulated for safety due to the flammability of gasoline and to insure that there are no combustible materials on the premises. Also it regulates location of the business with regard to distance from schools, churches, and other places of public assembly. • Liquor • Liquor is a highly regulated industry. State law requires local licensing of liquor sales. • Massage Parlor o Massage parlors are licensed to have some control over who and where this activity occurs. One of the primary concerns is to insure appropriate massage activity and to deter potential use of massage parlors as fronts for prostitution. • Mechanical o Mechanical licenses are to insure that qualified people are doing mechanical work. • Motor Vehicle Dealership o This type of business is regulated as to appropriate zoning, as well as building and site plan requirements relating to lighting equipment, fencing, vehicle parking, and showroom. • Pawnbroker o Pawnbrokers are required to be licensed by the State. The purpose of licensure is to identify qualified persons and to reduce and control the sale of stolen property. This activity requires substantial police interaction regarding stolen property. • Public Dancing o Public dancing has traditionally been an area where appropriate behavior and attention to security is needed to reduce the incident of violence. • Rap Parlors, Conversation Parlors, Adult Encounter Groups, Adult Sensitivity Groups, Escort Services, Model Services, Dancing Services, or Hostess Services o The issues of knowing who is engaged in these businesses to reduce the incidence of criminal activity is a prime reason for licensure. • Rental Dwellings o Rental dwellings are licensed to promote safe and sanitary rental units and to require compliance with building codes. Rental dwellings involve significant staff resources in inspection and police. • Saunas or Sauna Baths o The same issues are present as for massage parlors. • Secondhand Goods Dealer o Identification of who is in the business and the reduction of potential receipt of stolen goods is a major factor in licensing. v • Sign Hanger o There are a number of zoning and code issues surrounding sign placement. Licensure increases the likelihood of compliance with and knowledge of the need to comply with city code provisions. • Tattoo and Body Piercing Establishments o Health issues related to compliance with rules for tattooing and body piercing motivate licensing. Regulation provides standards for the design, construction, operation, and maintenance of this type of establishment. • Tobacco Related Products o Compliance with applicable laws on sale of tobacco and reduction in the availability of tobacco to minors is advanced through licensing. If the City does not license the sale of tobacco products, then the County must license the activity. A standard objective of local licensing is to meet consumer expectations of the safety of certain types of establishments. Local licensing also provides a method for suspension or revocation of licenses when an establishment has violated a statute or ordinance.