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City Annual Financial Report 2020 A,,lbertvillic Small living. Big City Life. XII r !i -- ■ w Comprehensive Annual Financial Report For the Year Ended December 31 , 2020 City of Albertville , Minnesota THIS PAGE IS LEFT BLANK INTENTIONALLY CITY OF ALBERTVILLE, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED DECEMBER 31 , 2020 ADAM NAFSTAD - CITY ADMINISTRATOR TINA LANNES - FINANCE DIRECTOR PREPARED BY DEPARTMENT OF FINANCE Member of the Government Finance Officers' Association of the United States and Canada THIS PAGE IS LEFT BLANK INTENTIONALLY City of Albertville, Minnesota Comprehensive Annual Financial Report Table of Contents For the Year Ended December 31, 2020 Page No. Introductory Section Letter of Transmittal from City Administrator and Finance Director 9 Certificate of Achievement of Excellence in Financial Reporting 13 Organizational Chart 14 Elected and Appointed Officials 15 Financial Section Independent Auditor's Report 19 Management's Discussion and Analysis 23 Basic Financial Statements Government-wide Financial Statements Statement of Net Position 37 Statement of Activities 38 Fund Financial Statements Governmental Funds Balance Sheet 42 Reconciliation of the Balance Sheet to the Statement of Net Position 45 Statement of Revenues, Expenditures and Changes in Fund Balances 46 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities 48 General Fund Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual 49 Proprietary Funds Statement of Net Position 50 Statement of Revenues, Expenses and Changes in Net Position 53 Statement of Cash Flows 54 Fiduciary Funds Statement of Fiduciary Net Position 56 Statement of Changes in Fiduciary Net Position 57 Notes to the Financial Statements 59 Required Supplementary Information Schedule of Employer's Share of Public Employees Retirement Association Net Pension Liability- General Employees Retirement Fund 92 Schedule of Employer's Public Employees Retirement Association Contributions - General Employees Retirement Fund 92 Notes to the Required Supplementary Information -General Employee Retirement Fund 93 Schedule of Employer's Share of Public Employees Retirement Association Net Pension Liability- Public Employees Police and Fire Fund 95 Schedule of Employer's Public Employees Retirement Association Contributions - Public Employees Police and Fire Fund 95 Notes to the Required Supplementary Information - Public Employees Police and Fire Fund 96 Schedule of Changes in the Fire Relief Association's Net Pension Liability (Asset) and Related Ratios 98 Schedule of Employer's Fire Relief Association Contributions 99 5 City of Albertville, Minnesota Comprehensive Annual Financial Report Table of Contents (Continued) For the Year Ended December 31, 2020 Page No. Combining and Individual Fund Financial Statements and Schedules Nonmajor Governmental Funds Combining Balance Sheet 104 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 105 Nonmajor Capital Projects Funds Combining Balance Sheet 108 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 110 General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual 112 Debt Service Funds Combining Balance Sheet 116 Combining Schedule of Revenues, Expenditures and Changes in Fund Balances 118 Fiduciary Funds Combining Statement of Fiduciary Net Position 120 Combining Statement of Changes in Fiduciary Net Position 121 Summary Financial Report Revenues and Expenditures for General Operations - Governmental Funds 122 Table Page No. Statistical Section (Unaudited) Net Position by Component 1 126 Changes in Net Position 2 128 Fund Balances of Governmental Funds 3 132 Changes in Fund Balances of Governmental Funds 4 134 Tax Capacity, Market Value and Estimated Actual Value of Taxable Property 5 136 Property Tax Capacity Rates - Direct and Overlapping Governments 6 139 Principal Taxpayers 7 140 Property Tax Levies and Collections 8 142 Ratios of Outstanding Debt by Type 9 143 Ratios of General Bonded Debt Outstanding 10 144 Computation of Direct and Overlapping Debt 11 145 Legal Debt Margin Information 12 146 Pledged-Revenue Coverage 13 148 Demographic and Economic Statistics 14 149 Principal Employers 15 150 Full-time Equivalent City Government Employees by Function 16 152 Operating Indicators by Function 17 153 Capital Asset Statistics by Function 18 155 6 INTRODUCTORY SECTION CITY OF ALBERTVILLE ALBERTVILLE, MINNESOTA FOR THE YEAR ENDED DECEMBER 31 , 2020 7 THIS PAGE IS LEFT BLANK INTENTIONALLY 8 JL_� Nbcrtvi 11 E 5959%lain Av mi c KE•F Ci.Bwa 4-A lborl Ville-MN 55301 .763-497.33114•FwL A-4 497-1210 April 19, 2021 Honorable Mayor, Members of the City Council and Citizens of the City of Albertville City of Albertville, Minnesota Minnesota statutes require the City to issue an annual report on its financial position and activity, prepared in accordance with generally accepted accounting principles (GAAP), and audited in accordance with generally accepted auditing standards by a firm of licensed certified public accountants, or the Office of the State Auditor. Pursuant to that requirement, we hereby issue the Comprehensive Annual Financial Report (CAFR) of the City of Albertville for the fiscal year ended December 31, 2020. This report consists of management's representations concerning the finances of the City of Albertville. Management assumes full responsibility for the completeness and reliability of the information contained in this report, based upon a comprehensive framework of internal control standards that it has established for this purpose. Because the cost of internal control should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute assurance that the financial statements are free of any material misstatements. As management, we assert that, to the best of our knowledge and belief, this financial report is complete and reliable in all material respects. The City of Albertville's financial statements have been audited by the public accounting firm of Abdo, Eick& Meyers, LLP. The goal of the independent audit was to provide reasonable assurance that the financial statements of the City of Albertville for the fiscal year ended December 31, 2020, are free of any material misstatements. Included within this report, Abdo, Eick & Meyers, LLP. has issued an unqualified opinion on the City of Albertville's financial statements for the year ended December 31, 2020. Management's Discussion and Analysis (MD&A) immediately follows the independent auditor's report and provides a narrative introduction, overview, and analysis of the basic financial statements. This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. Profile of the City of Albertville The City of Albertville is located in the east central portion of Minnesota, approximately 35 miles northwest of the Twin Cities, and approximately halfway between the metropolitan areas of Minneapolis/St. Paul and St. Cloud. The City of Albertville is located in the northeastern portion of Wright County, along the Interstate 94 corridor. The City covers 4.56 square miles. The current population is approximately 7,519. The City of Albertville operates under the council/administrator form of government. The governing body consists of the Mayor and four Council members, elected at large and on a non- partisan basis. The Mayor is elected to a two-year term and four Council Members are elected to a four-year term, with elections held in each even-numbered year. Not more than two Council member's terms expire in any one year. 9 The Mayor and Council appoint a full-time City Administrator, who is responsible for overall supervision of City operations. The City Council is responsible for, among other things, passing ordinances, adopting the budget, appointing committees, hiring the City Administrator, other staff and appointing consultants. The City provides its residents and businesses with a full range of services, including fire protection, law enforcement, public works, building inspection, planning and code enforcement, parks/trail improvements and maintenance, curbside recycling and other general activities. The City contracts with the Wright County Sheriff's Department for 28-hour law enforcement. In addition, the City offers the following services to residents: water, sewer, storm drainage, and recycling, which are operated as enterprises. The City also partners with neighboring communities and the county to provide public transit, library, and senior center services. In addition, the governing body is financially accountable for the Economic Development Authority and therefore, these activities are included in the reporting entity. Relevant Financial Policies The annual budget serves as the foundation for the City's financial planning and control. Developing the budget begins annually in June when the Finance Director prepares projected revenues and expenses for the next year's draft budget. Upon review and revisions by the Finance Director and Administrator, the draft budget is reviewed by the Department Heads. Department budget requests are compiled by the Finance Director and reviewed by both the Finance Director and Administrator. Integral to the budget process is a staff meeting to review the draft budget, which is then presented to the City Council. City Council and staff work on the budget over the course of two to three budget workshops. Following Council direction and public input, the preliminary budget is updated and brought back for Council approval. Council adopts the preliminary budget in September and the Final Budget is adopted in December of each year. If a need arises for a significant budget amendment during the year, it is brought to City Council for approval. Also, available within, are notes pertaining to basic financial statements for information on the Joint Powers Water Board (the City's water operations, operated in conjunction with the cities of St. Michael and Hanover). Economic Condition and Outlook Based on permit activity, the local economy is strong and continues to grow. A total of 670 building permits were issued in 2020 with a total valuation of$21,226,443. The number of new housing units in 2020 was 36, with an average valuation of approximately$283,365 per home. The State of Minnesota is constructing six lanes of freeway to the City of Albertville, as well as, improving the existing interchange access to the freeway at county state aid highways 37 and 19. Another key financial factor affecting the City's financial outlook is the City's bond rating, which has increased two times since 2002 and is currently an AA3. The area school districts are highly desirable and driving new residential interest to the area. In December 2019, a novel strain of coronavirus (COVID-19)surfaced. The spread of COVID-19 around the world in the first quarter of 2020 has caused significant volatility in U.S. and international markets. There is significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. and international economies and, as such, the Organization is unable to determine if it will have a material impact to its operations. 10 Commercial, Industrial and Retail The City of Albertville's commercial activity remains steady and it is a priority of the City to stimulate new commercial and industrial development. Currently, there are a number of commercial and industrial projects underway. Major Initiatives Maintenance and preservation of the City infrastructure and facilities is a priority for the City. In 2020, the City completed multiple infrastructure improvements related to streets, utilities, trails and parks. The City has actively pursued regional transportation and interstate improvements through the I- 94 Coalition, a consortium of cities and businesses. Through the State's Corridors for Commerce legislation, multiple projects benefiting Interstate 94 have been successfully completed, and in 2019 the State began a project to build 6-lanes of freeway between Highway 241 in St. Michael and CSAH 19 in Albertville. This project will benefit Albertville by extending the 6-lanes to the City and by improving the City's two interstate interchanges and improving access to the interstate. The Interstate project is approximately$75 million (+/-)and is funded by the State. Wright County recently completed reconstruction and expansion of County State Aid Highways 19 and 38 through Albertville. The two improved corridors will benefit the areas housing and commercial opportunities. The City recently completed improvements to its wastewater treatment plant and facility. Long-term Financial Planning The City of Albertville recognizes the importance of maintaining an appropriate level of fund balance. Sound fiscal management of Albertville's general fund operation budget is made more secure by establishing City goals regarding the size and use of the annual general fund balances. This policy provides two goals and measures for determining the appropriate fund balance. The security factor must be met before the dependence factor can be applied. The City of Albertville will strive to meet these goals. 1. Security. Ensure that, at NO time during budget preparation, the amounts remaining in current year-end fund balance (defined as the prior year's known fund balance amount less the amount designated for application to the current year budget) be allowed to be less than 35% of the next year's planned budget for the General Fund as a minimum. As economic conditions warrant, an amount larger than this shall be maintained. This will be applied to cash flow, revenue reserves and insurance, and liability needs, or be available in the time of emergencies. If the current fund balance meets or exceeds the 35%, the intent is to increase this level to 50% of next year's expenditures. If the fund balance level falls below the 35% due to unexpected expenses, a replenishment plan will be developed. 2. Dependence. In building the next year's budget, the percentage of total annual budget financing that can come from fund balances will not exceed 5% of the planned budget. Property Taxes To sustain or expand City services, while keeping property taxes stable, the Council has diligently strived to maintain a level tax rate. The property tax levy for the year divided by the city-wide total net tax capacity equals the tax rate. 11 Independent Audit The financial statements were audited by Abdo, Eick & Meyers, LLP, Certified Public Accountants, and their opinion has been included in this report. The scope of the audit included the basic financial statements of the City for the year ended December 31, 2020. Their audit was made in accordance with auditing standards generally accepted in the United States of America. The scope of the audit was sufficient to satisfy state and federal requirements. The auditors' opinion on the City's financial statements indicates that the auditors' examination has disclosed no conditions which cause them to believe that the financial statements are not fairly stated, in all material respects. Certificate of Achievement The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City for its CAFR for the fiscal year ended December 31, 2019. This is the ninth consecutive year the City has received this prestigious award. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized CAFR, whose contents conforms to program standards. Such reports must satisfy both accounting principles generally accepted in the United States of America and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe our current CAFR continues to meet the Certificate of Achievement's requirements and we are again submitting it to the GFOA to determine its eligibility for another certificate. Acknowledgments I would like to commend Finance Director Lannes and the entire city staff for their hard work and dedication. I would like to recognize the CPA firm Abdo, Eick& Meyers, LLP for their professional assistance. Finally, thank you to the Mayor and members of the City Council for your continued interest and support in planning and conducting the financial operations of the City in a very responsible and professional manner. Respectfully submitted, Adam Nafstad City Administrator/PWD/CE 12 Dt Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting Presented to City of Albertville Minnesota For its Comprehensive Annual Financial Report For the Fiscal Year Ended December 31, 2019 P- Executive Director/CEO 13 �bertville City of Albertville Organizational Chart V.- Consultants city Co,,di City Attorney City Plan-Committee Contract Services _ Gly= ,tat Sheriff's Department Director/City ty Engm— F—fly youth Collaborative Assessor jrIrl,,nt Powers and Recreation Senior PmP.bH,W.rk�C...i.j Personnel Committee Board 11.Arena Board F-- —-- -I City Ckrk Finance Director Admin.Asst. CI.,k 11 ST..Ice I.- Fire Department Tech) Election lodges Finance staff Fire Chid Utility Employees Parks Employees Fire Officers Volunteer Firemen 14 City of Albertville, Minnesota Elected and Appointed Officials For the Year Ended December 31, 2020 ELECTED Name Title Term Expires Jillian Hendrickson Mayor 12/31/22 Rob Olson Council Member 12/31/22 Walter Hudson Council Member 12/31/24 Rebecca Halling Council Member 12/31/22 Aaron Cocking Council Member 12/31/24 APPOINTED Name Title Adam Nafstad City Administrator Tina Lannes Finance Director 15 THIS PAGE IS LEFT BLANK INTENTIONALLY 16 FINANCIAL SECTION CITY OF ALBERTVILLE ALBERTVILLE, MINNESOTA FOR THE YEAR ENDED DECEMBER 31 , 2020 17 THIS PAGE IS LEFT BLANK INTENTIONALLY 18 ABDO EIC K & r NW RSLLP Cer[.ified Public Accuura[afa.. & Coaud[aras INDEPENDENT AUDITOR'S REPORT Honorable Mayor and City Council City of Albertville, Minnesota Report on the Financial Statements We have audited the accompanying financial statements of governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of the City of Albertville, Minnesota (the City), as of and for the year ended December 31, 2020, and the related notes to the financial statements, which collectively comprise the City's basic financial statements as listed in the table of contents. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the City's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall financial statement presentation. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of the City as of December 31, 2020, and the respective changes in financial position and, where applicable, cash flows thereof and the respective budgetary comparison for the General fund for the year then ended in conformity with accounting principles generally accepted in the United States of America. 19 THIS PAGE IS LEFT BLANK INTENTIONALLY 20 Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis starting on page 23 and the Schedules of Employer's Share of the Net Pension Liability, the Schedules of Employer's Contributions, the related note disclosures, the Schedule of Changes in Net Pension Liability (Asset) and Related Ratios starting on page 92 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City's basic financial statements. The introductory section, combining and individual fund financial statements and schedules and statistical section are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual fund financial statements, schedules, and statistical section are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual fund financial statements and schedules are fairly stated, in all material respects, in relation to the basic financial statements as a whole. The introductory section and statistical section have not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on them. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated April 19, 2021, on our consideration of the City's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City's internal control over financial reporting and compliance. Ly ABDO, EICK& MEYERS, LLP Minneapolis, Minnesota April 19, 2021 21 THIS PAGE IS LEFT BLANK INTENTIONALLY 22 Management's Discussion and Analysis As management of the City of Albertville, Minnesota, (the City), we offer readers of the City's financial statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended December 31, 2020. Financial Highlights • The assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows of resources at the close of the most recent fiscal year by$52,194,773 (net position). Of this amount, $17,698,606 (unrestricted net position) may be used to meet the City's ongoing obligations to citizens and creditors. • The City's total net position increased $1,969,103. This increase is attributable to the governmental activities increasing $659,713 due to increased operating revenues such as permit revenue, charges for services, capital, and grant revenues. • As of the close of the current fiscal year, the City's governmental funds reported combined ending fund balances of$10,410,583, a decrease of$175,919 in comparison with the prior year. Approximately 65.1 percent of this total amount, $6,775,571 is available for spending at the City's discretion but a portion has been assigned for specific purposes. • At the end of the current fiscal year, unassigned fund balance for the General fund was $3,200,223, or 83.5 percent of total General fund 2020 expenditures. • The City's total debt decreased 11.0 percent during the current fiscal year. 23 Overview of the Financial Statements This discussion and analysis is 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 supplemental information in addition to the basic financial statements themselves. The financial statements also include notes that explain some of the information in the financial statements and provide more detailed data. The statements are followed by a section of combining and individual fund financial statements and schedules which further explain and support the information in the financial statements. Figure 1 shows how the required parts of this annual report are arranged and relate to one another. In addition to these required elements, we have included a section with combining and individual fund financial statements and schedules that provide details about non- major governmental funds, which are added together and presented in single columns in the basic financial statements. Figure 1 Required Components of the City's Annual Financial Report Management's Basic Re ired DiSCUssion and Financial Supplementary Analysis Statements Information Govemment- Fund Notes to the wide Financial Financial Financial Statements Statements State ments Surnmar-y. Detail 24 Figure 2 summarizes the major features of the City's financial statements, including the portion of the City government they cover and the types of information they contain. The remainder of this overview section of management's discussion and analysis explains the structure and contents of each of the statements. Figure 2 Major Features of the Government-wide and Fund Financial Statements Fund Financial Statements Government-wide Governmental Funds Proprietary Funds Statements Scope Entire City government The activities of the City that Activities the City operates (except fiduciary funds) and are not proprietary or similar to private the City's component units fiduciary, such as police, fire businesses, such as the and parks water and sewers stem Required financial . Statement of Net • Balance Sheet • Statements of Net statements Position . Statement of Revenues, Position • Statement of Activities Expenditures, and • Statements of Changes in Fund Revenues, Expenses Balances and Changes in Net Position • Statements of Cash Flows Accounting basis and Accrual accounting and Modified accrual accounting Accrual accounting and measurement focus economic resources focus and current financial economic resources focus resources focus Type of asset/liability All assets and liabilities, both Only assets expected to be All assets and liabilities, information financial and capital, and used up and liabilities that both financial and capital, short-term and long-term come due during the year or and short-term and long- soon thereafter; no capital term assets included Type of deferred All deferred outflows/inflows Only deferred outflows of All deferred outflows/inflows outflows/inflows of of resources, regardless of resources expected to be of resources, regardless of resources information when cash is received or used up and deferred when cash is received or paid inflows of resources that paid come due during the year or soon thereafter; no capital assets included Type of in flow/out All revenues and expenses Revenues for which cash is All revenues and expenses flow information during year, regardless of received during or soon after during the year, regardless when cash is received or the end of the year; of when cash is received or paid expenditures when goods or paid services have been received and payment is due during the year or soon thereafter 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 position presents information on all of the City's assets and deferred outflows of resources, and liabilities and deferred inflows of resources, with the difference reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. The statement of activities presents information showing how the City's net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave). 25 Both of the government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenue (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, public safety, public works, culture and recreation, economic development and interest on long-term debt. The business-type activities of the City include sewer, water, storm water and recycling. The government-wide financial statements start on page 37 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 three categories: governmental funds, proprietary funds and fiduciary funds. Governmental Funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact by the government's near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. The City maintains 11 individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures and changes in fund balances for the General fund, Debt Service and Capital Outlay Reserve -all of 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 orschedules elsewhere in this report. The City adopts an annual appropriated budget for its General fund. A budgetary comparison statement has been provided for the General fund to demonstrate compliance with this budget. The basic governmental fund financial statements start on page 42 of this report. Proprietary Funds. The City maintains one type of proprietary fund. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its sewer, water storm water and recycling operations. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for each of the enterprise funds. The basic proprietary fund financial statements start on page 50 of this report. Fiduciary Funds. Fiduciary funds are used to account for resources held for the benefit of parties outside the City. Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support the City's own programs. The accounting used for fiduciary funds is much like that used for proprietary funds. The basic fiduciary fund financial statements are on page 56 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 start on page 59 of this report. Other Information. The combining statements referred to earlier in connection with non-major governmental funds are presented following the notes to the financial statements. Combining and individual fund statements and schedules start on page 104 of this report. 26 Required Supplementary Information. In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning the City's progress in funding its obligation to provide pension and other post-employment benefits to its employees. Required supplementary information can be found starting on page 92 of this report. Government-wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of a government's financial position. In the case of the City, assets and deferred outflows of resources exceeded liabilities by $52,194,773 at the close of the most recent fiscal year. By far, the largest portion of the City's net position (56.3 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. City of Albertville's Summary of Net Position Governmental Activities Business-type Activities Increase Increase 2020 2019 (Decrease) 2020 2019 (Decrease) Current and Other Assets $ 13,609,640 $ 13,780,998 $ (171,358) $ 11,236,184 $ 12,260,062 $ (1,023,878) Capital Assets 23,538,910 23,288,672 250,238 18,095,345 17,137,147 958,198 Total Assets 37,148,550 37,069,670 78,880 29,331,529 29,397,209 (65,680) Deferred Outflows of Resources 466,062 543,704 (77,642) 70,295 51,152 19,143 Long-term Liabilities Outstanding 6,060,143 6,803,260 (743,117) 7,768,030 8,384,915 (616,885) Other Liabilities 472,016 294,542 177,474 280,413 973,701 (693,288) Total Liabilities 6,532,159 7,097,802 (565,643) 8,048,443 9,358,616 (1,310,173) Deferred Inflows of Resources 221,312 314,144 (92,832) 19,749 65,503 (45,754) Net Position Net investment in capital assets 18,587,524 17,512,792 1,074,732 10,788,055 10,922,191 (134,136) Restricted 5,120,588 5,398,928 (278,340) - - - Unrestricted 7,153,029 7,289,708 (136,679) 10,545,577 9,102,051 1,443,526 Total Net Position $ 30,861,141 $ 30,201,428 $ 659,713 $ 21,333,632 $ 20,024,242 $ 1,309,390 An additional portion of the City's net position, $5,120,588, represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net position $17,698,606 may be used to meet the City's ongoing obligations to citizens and creditors. At the end of the current fiscal year, the City is able to report positive balances in all three categories of net position, both for the City as a whole, as well as for its separate governmental and business-type activities. 27 Governmental Activities. Governmental activities increased the City's net position $659,713. Significant changes from the prior year are noted below: • Governmental activities increasing $659,713 due to increased operating revenues such as permit revenue, charges for services, capital, and grant revenues. City of Albertville's Changes in Net Position Governmental Activities Business-type Activities Increase Increase 2020 2019 (Decrease) 2020 2019 (Decrease) Revenues Program Revenues Charges for services $ 1,404,695 $ 968,868 $ 435,827 $ 1,802,145 $ 1,529,146 $ 272,999 Operating grants and contributions 852,421 191,470 660,951 22,273 22,416 (143) Capital grants and contributions 1,324,103 359,247 964,856 1,203,165 1,515,818 (312,653) General Revenues Taxes Property taxes 3,976,317 4,005,888 (29,571) - - - Tax increment 240,457 232,684 7,773 - - - Grants and contributions not restricted to specific programs 126,418 113,056 13,362 - - - Gain on sale of capital assets - 140,879 (140,879) - - - Miscellaneous - - - Unrestricted investment earnings 190,441 384,339 (193,898) 219,142 346,171 (127,029) Total Revenues 8,114,852 6,396,431 1,718,421 3,246,725 3,413,551 (166,826) Expenses General government 1,058,803 767,343 291,460 - - - Public safety 1,941,340 1,877,457 63,883 - - - Public works 3,185,369 1,195,560 1,989,809 - - - Culture and recreation 882,232 1,069,989 (187,757) - - - Economic development 237,902 223,663 14,239 - - - Interest on long-term debt 149,493 191,958 (42,465) - - - Sewer - - - 1,111,727 1,102,919 8,808 Water - - - 417,826 451,246 (33,420) Storm water - - - 290,418 252,627 37,791 Recycling - - - 117,364 118,359 (995) Total Expenses 7,455,139 5,325,970 2,129,169 1,937,335 1,925,151 12,184 Change in Net Position 659,713 1,070,461 - 1,309,390 1,488,400 - Net Position, January 1 30,201,428 29,130,967 1,070,461 20,024,242 18,535,842 1,488,400 Net Position, December 31 $ 30,861,141 $ 30,201,428 $ 659,713 $ 21,333,632 $ 20,024,242 $ 11309,390 28 The following graph depicts various governmental activities and shows the revenue and expenses directly related to those activities. Expenses and Program Revenues - Governmental Activities $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $- General Public Safety Public Works Culture and Economic Interest on Long- Government Recreation Development term Debt ■Expenses ■Program Revenues Revenues by Source - Governmental Activities For the most part, increases in expenses closely paralleled inflation and growth in the demand for services. 17.3%, Charges for 2.3%, Unrestricted Services Investment 10.5%, Operating Earnings Grants and Contributions 1.6%, Grants and Contributions Unrestricted 16.3%, Capital Grants and Contributions 52.0%, Taxes 29 Business-type Activities. Business-type activities increased the City's net position by$1,309,390 mainly due to capital contributions. Expenses and Program Revenues - Business-type Activities $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 Sewer Water Storm Water Recycling ■Expenses ■Program Revenues Revenues by Source - Business-type Activities 55.5%, Charges for Services 0.7%, Operating Grants and Contributions, 6.7%, Investment Earnings 37.1%, Capital Grants and Contributions 30 Financial Analysis of the Government's Funds As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. 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, unassigned fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year. As of the end of the current fiscal year, the City's governmental funds had combined ending fund balances of $10,410,583, a decrease of$175,919 in comparison with the prior year. Approximately 65.1 percent of this total amount, $6,775,571, constitutes assigned and unassigned fund balance, which is available for spending at the City's discretion but assigned for specific purposes. The remainder of fund balance $3,478,869 is not available for new spending because it is either 1) nonspendable $90,389 or 2) restricted $3,388,480. There is also $156,143 committed for specific purposes. The General fund is the chief operating fund of the City. At the end of the current year, the fund balance of the General fund was $3,290,612. The fund balance of the City's General fund increased $672,687 during the current fiscal year. This increase is attributable to increased intergovernmental revenues. The Debt Service fund balance decreased $9,420 from the prior year for an ending fund balance of$3,247,679. The City levies 105% of the following years debt service payment. The Capital Outlay Reserve fund balance decreased $888,382, for an ending fund balance of$3,965,154. The City budgets annually for future capital projects and purchases and current projects utilized fund balance. Proprietary Funds: The City's proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail. Unrestricted net position of the enterprise funds at the end of the year amounted to $10,545,577. The total increase in net position for the funds was $1,309,390. Other factors concerning the finances of these funds have already been addressed in the discussion of the City's business-type activities. General Fund Budgetary Highlights The City's General fund budget was not amended during the year. The budget called for a decreased in fund balance of $12,463. The actual activity of the General fund resulted in an increase of$672,687. The general fund received more revenues than budgeted in all areas. Revenues were over budget by $1,216,710. All revenue categories were over budget. Intergovernmental and charges for services revenue sources had the largest positive variances of$611,685 and $337,827, respectively. This increase is attributable to CARES Act funding, charges for services (buildings, fire calls, licenses and permits), fire aid, and lease payments. Expenditures were over budget by$531,560. General government was over budget by $72,350 and culture and recreation was over budget by $311,244. 31 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, 2020, amounts to $41,634,255 (net of accumulated depreciation). This investment in capital assets includes land, construction in progress, structures, improvements, machinery and equipment, park facilities, roads, highways and bridges. The total decrease in the City's investment in capital assets for the current fiscal year was due to depreciation. Additional information on the City's capital assets can be found in Note 313 starting on page 71 of this report. City of Albertville's Capital Assets (Net of Depreciation) Governmental Activities Business-type Activities Increase Increase 2020 2019 (Decrease) 2020 2019 (Decrease) Land $ 3,983,292 $ 3,983,292 $ - $ 351,834 $ 351,834 $ - Construction in Progress 845,292 - 845,292 7,964,615 6,590,589 1,374,026 Buildings 4,085,837 4,246,184 (160,347) 2,960,186 3,078,178 (117,992) Infrastructure 10,945,050 11,250,948 (305,898) 6,748,009 7,010,649 (262,640) Land Improvements 1,234,858 1,355,903 (121,045) - - - Machinery and Equipment 797,941 761,929 36,012 22,922 41,896 (18,974) Vehicles 1,646,640 1,690,416 (43,776) 47,779 64,001 (16,222) Total $ 23,538,910 $ 23,288,672 $ 250,238 $ 18,095,345 $ 17,1377147 $ 958,198 Long-term Debt: At the end of the current fiscal year, the City had total bonded debt outstanding of$12,411,633. This amount consists of general obligation special assessment, general obligation revenue bonds and revenue bonds. While many of these bonds have their own revenue streams, they are backed by the full faith and credit of the City. City of Albertville's Outstanding Debt Governmental Activities Business-type Activities Increase Increase 2020 2019 (Decrease) 2020 2019 (Decrease) General Obligation Special Assessment Bonds $ 5,104,343 $ 5,967,076 $ (862,733) $ 242,617 $ 318,923 $ (76,306) General Obligation Revenue Bonds - - - 7,064,673 7,656,726 (592,053) Total $ 5,104,343 $ 5,967,076 $ (862,733) $ 7,307,290 $ 7,975,649 $ (668,359) The City's total debt decreased $1,531,092 during the current fiscal year. This decrease is attributable to regularly scheduled debt payments. Minnesota statutes limit the amount of net general obligation debt a City may issue to 3 percent of the market value of taxable property within the City. Net debt is debt payable solely from ad valorem taxes. The City's applicable debt does not exceed the limit set forth in statute. Additional information on the City's long-term debt can be found in Note 3D starting on page 73 of this report. 32 Economic Factors and Next Year's Budgets and Rates Residential property values continue to increase from the previous years and neighborhoods continue to be very stable. New housing starts remain steady and overall permit activity remains steady. Multi-family housing interest is strong. Commercial property values have improved and commercial interest is strong. Budgeted capital projects are generally targeted towards maintenance and preservation of the City's infrastructure. Many transportation infrastructure projects are underway and nearing completion, including Interstate 94, County State Highway 19, and County State Highway 38. These improvements will improve access to and from the interstate and commercial properties. State and/or Federal funds received due to the COVID-19 pandemic are expected to used towards economic development and/or capital improvements. 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 City's finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Finance Director, City of Albertville, 5959 Main Avenue, Albertville, Minnesota 55301. 33 THIS PAGE IS LEFT BLANK INTENTIONALLY 34 GOVERNMENT-WIDE FINANCIAL STATEMENTS CITY OF ALBERTVILLE ALBERTVILLE, MINNESOTA FOR THE YEAR ENDED DECEMBER 31 , 2020 35 THIS PAGE IS LEFT BLANK INTENTIONALLY 36 City of Albertville, Minnesota Statement of Net Position December 31, 2020 Governmental Business-type Activities Activities Total Assets Cash and temporary investments $ 9,421,360 $ 10,880,660 $ 20,302,020 Receivables Interest 43,374 - 43,374 Taxes 51,588 - 51,588 Accounts 53,076 178,830 231,906 Notes-due within one year 73,148 - 73,148 Notes-due in more than one year 804,632 32,144 836,776 Special assessments 1,276,707 109,467 1,386,174 Due from other governments - 16,548 16,548 Prepaid items 39,389 18,535 57,924 Equity interest in joint venture 211,827 - 211,827 Net pension asset 362,586 - 362,586 Land held for resale 1,271,953 - 1,271,953 Capital assets Land and construction in progress 4,828,584 8,316,448 13,145,032 Depreciable assets, net of accumulated depreciation 18,710,326 9,778,897 28,489,223 Total Assets 37,148,550 29,331,529 66,480,079 Deferred Outflows of Resources Loss on refunding bonds 152,957 - 152,957 Deferred pension resources 313,105 70,295 383,400 Total Deferred Outflows of Resources 466,062 70,295 536,357 Liabilities Accounts and contracts payable 254,600 150,732 405,332 Escrows payable 158,490 - 158,490 Due to other governments - 51,085 51,085 Accrued interest payable 29,111 61,015 90,126 Accrued salaries payable 29,815 17,581 47,396 Noncurrent liabilities Due within one year Long-term liabilities 979,556 651,571 1,631,127 Due in more than one year Long-term liabilities 4,278,862 6,744,481 11,023,343 Net pension liability 801,725 371,978 1,173,703 Total Liabilities 6,532,159 8,048,443 14,580,602 Deferred Inflows of Resources Deferred pension resources 221,312 19,749 241,061 Net Position Net investment in capital assets 18,587,524 10,788,055 29,375,579 Restricted for Debt service 4,979,787 - 4,979,787 Park dedication 229 - 229 Tax increment 140,572 - 140,572 Unrestricted 7,153,029 10,545,577 17,698,606 Total Net Position $ 30,861,141 $ 21,333,632 $ 52,194,773 The notes to the financial statements are an integral part of this statement. 37 City of Albertville, Minnesota Statement of Activities For the Year Ended December 31, 2020 Program Revenues Operating Capital Grants Charges for Grants and and Functions/Programs Expenses Services Contributions Contributions Governmental Activities General government $ 1,058,803 $ 640,044 $ 204,125 $ 84,018 Public safety 1,941,340 458,866 606,449 - Public works 3,185,369 4,350 23,315 1,239,754 Culture and recreation 882,232 301,435 2,913 331 Economic development 237,902 - 15,619 - Interest on long-term debt 149,493 - - - Total Governmental Activities 7,455,139 1,404,695 852,421 1,324,103 Business-type Activities Sewer 1,111,727 1,072,549 10,830 1,123,220 Water 417,826 411,854 - 74,992 Storm Water 290,418 222,281 - 3,492 Recycling 117,364 95,461 11,443 1,461 Total Business-type Activities 1,937,335 1,802,145 22,273 1,203,165 Total $ 9,392,474 $ 3,206,840 $ 874,694 $ 2,527,268 General Revenues Taxes Property taxes levied for general purposes Property taxes levied for debt service Tax increments Grants and contributions not restricted to specific programs Unrestricted investment earnings Total General Revenues Change in Net Position Net Position, January 1 Net Position, December 31 The notes to the financial statements are an integral part of this statement. 38 Net (Expenses) Revenues and Changes in Net Position Governmental Business-type Activities Activities Total $ (130,616) $ - $ (130,616) (876,025) - (876,025) (1,917,950) - (1,917,950) (577,553) - (577,553) (222,283) - (222,283) (149,493) - (149,493) (3,873,920) - (3,873,920) - 1,094,872 1,094,872 - 69,020 69,020 - (64,645) (64,645) - (8,999) (8,999) - 1,090,248 1,090,248 (3,873,920) 1,090,248 (2,783,672) 3,469,449 - 3,469,449 506,868 - 506,868 240,457 - 240,457 126,418 - 126,418 190,441 219,142 409,583 4,533,633 219,142 4,752,775 659,713 1,309,390 1,969,103 30,201,428 20,024,242 50,225,670 $ 30,861,141 $ 21,333,632 $ 52,194,773 The notes to the financial statements are an integral part of this statement. 39 THIS PAGE IS LEFT BLANK INTENTIONALLY 40 FUND FINANCIAL STATEMENTS CITY OF ALBERTVILLE ALBERTVILLE, MINNESOTA FOR THE YEAR ENDED DECEMBER 31 , 2020 41 City of Albertville, Minnesota Balance Sheet Governmental Funds December 31, 2020 Capital Projects Capital Debt Outlay General Service Reserve Assets Cash and temporary investments $ 3,337,813 $ 1,628,323 $ 4,154,491 Receivables Taxes 51,588 - - Accounts 53,076 - - Special assessments 54,335 883,565 338,807 Interest 38,692 4,682 - Notes - 877,780 - Advances to other funds - 393,595 - Prepaid items 39,389 - - Land held for resale 51,000 1,220,953 - Total Assets $ 3,625,893 $ 5,008,898 $ 4,493,298 Liabilities Accounts and contracts payable $ 65,042 $ - $ 189,558 Escrows payable 158,490 - - Advances from other funds - - - Accrued salaries payable 29,815 - - Total Liabilities 253,347 - 189,558 Deferred Inflows of Resources Unavailable revenue - property taxes 31,256 - - Unavailable revenue -special assessments 50,678 883,439 338,586 Unavailable revenue - notes/intergovernmental - 877,780 - Total Deferred Inflows of Resources 81,934 1,761,219 338,586 Fund Balances Nonspendable 90,389 - - Restricted - 3,247,679 - Committed - - - Assigned - - 3,965,154 Unassigned 3,200,223 - - Total Fund Balances 3,290,612 3,247,679 3,965,154 Total Liabilities, Deferred Inflows of Resources and Fund Balances $ 3,625,893 $ 5,008,898 $ 4,493,298 The notes to the financial statements are an integral part of this statement. 42 Other Total Governmental Governmental Funds Funds $ 300,733 $ 9,421,360 - 51,588 - 53,076 - 1,276,707 - 43,374 - 877,780 - 393,595 - 39,389 - 1,271,953 $ 300,733 $ 13,428,822 $ - $ 254,600 - 158,490 393,595 393,595 - 29,815 393,595 836,500 - 31,256 - 1,272,703 - 877,780 - 2,181,739 - 90,389 140,801 3,388,480 156,143 156,143 - 3,965,154 (389,806) 2,810,417 (92,862) 10,410,583 $ 300,733 $ 13,428,822 The notes to the financial statements are an integral part of this statement. 43 THIS PAGE IS LEFT BLANK INTENTIONALLY 44 City of Albertville, Minnesota Reconciliation of the Balance Sheet to the Statement of Net Position December 31, 2020 Amounts reported for the governmental activities in the statement of net position are different because Total Fund Balances -Governmental $ 10,410,583 Governmental funds do not report an asset for equity interest in the joint venture 211,827 Capital assets used in governmental activities are not financial resources and therefore are not reported as assets in governmental funds. Cost of capital assets 49,377,724 Less: accumulated depreciation (25,838,814) Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported as liabilities in the funds. Long-term liabilities at year-end consist of Compensated absences payable (154,075) Bond principal payable (5,104,343) Net pension liability (801,725) Deferred outflows of resources, loss on refunding bond 152,957 Some receivables are not available soon enough to pay for the current period's expenditures, and therefore are deferred in the funds. Special assessments 1,272,703 Taxes 31,256 Notes/intergovernmental 877,780 Governmental funds do not report long-term amounts related to pension. Deferred outflows of pension resources 313,105 Deferred inflows of pension resources (221,312) Net pension asset 362,586 Governmental funds do not report a liability for accrued interest until due and payable. (29,111) Total Net Position - Governmental Activities $ 30,861,141 The notes to the financial statements are an integral part of this statement. 45 City of Albertville, Minnesota Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds For the Year Ended December 31, 2020 Capital Projects Capital Debt Outlay General Service Reserve Revenues Taxes $ 2,145,139 $ 559,868 $ 1,275,868 Licenses and permits 300,888 - - Intergovernmental 840,195 - 1,237,247 Charges for services 1,063,090 - - Special assessments 28,905 269,296 54,748 Interest on investments 37,030 46,935 101,582 Miscellaneous 91,964 84,930 4,931 Total Revenues 4,507,211 961,029 2,674,376 Expenditures Current General government 876,331 - 44,587 Public safety 1,629,347 - - Public works 419,890 7,792 - Culture and recreation 763,021 - - Economic development 39,694 - - Capital outlay General government 18,958 - 1,447 Public safety 87,283 - 94,800 Public works - - 3,301,579 Culture and recreation - - 92,613 Economic development - - 27,732 Debt service Principal - 856,000 - Interest and other - 106,657 - Total Expenditures 3,834,524 970,449 3,562,758 Net Change in Fund Balances 672,687 (9,420) (888,382) Fund Balances, January 1 2,617,925 3,257,099 4,853,536 Fund Balances, December 31 $ 3,290,612 $ 3,247,679 $ 3,965,154 The notes to the financial statements are an integral part of this statement. 46 Other Total Governmental Governmental Funds Funds $ 240,457 $ 4,221,332 - 300,888 - 2,077,442 13,284 1,076,374 - 352,949 4,894 190,441 - 181,825 258,635 8,401,251 - 920,918 - 1,629,347 - 427,682 - 763,021 170,476 210,170 - 20,405 - 182,083 - 3,301,579 22,452 115,065 - 27,732 - 856,000 16,511 123,168 209,439 8,577,170 49,196 (175,919) (142,058) 10,586,502 $ (92,862) $ 10,410,583 The notes to the financial statements are an integral part of this statement. 47 City of Albertville, Minnesota Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities Governmental Funds For the Year Ended December 31, 2020 Amounts reported for governmental activities in the statement of activities are different because Total Change Is Fund Balances $ (175,919) Governmental funds do not report income or loss in a joint venture. (12,310) Capital outlays are reported in governmental funds as expenditures. However, in the statement of activities, the cost of those assets is allocated over the estimated useful lives as depreciation expense. Capital outlays 1,788,401 Depreciation expense (1,538,163) The issuance of long-term debt provides current financial resources to governmental funds,while the repayment of principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and similar items when debt is first issued, whereas these amounts are amortized in the statement of activities. Principal repayments 856,000 Amortization of loss on refunding and premium (31,506) Interest on long-term debt in the statement of activities differs from the amount reported in the governmental fund because interest is recognized as an expenditure in the funds when it is due, and thus requires the use of current financial resources. In the statement of activities, however, interest expense is recognized as the interest accrues, regardless of when it is due. 5,181 Long-term pension activity is not reported in governmental funds. Pension expense 18,847 Pension revenue 54,424 Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds. Compensated absences 23,271 Certain revenues are recognized as soon as they are earned. Under the modified accrual basis of accounting certain revenues cannot be recognized until they are available to liquidate liabilities of the current period. Special assessments (250,805) Taxes (4,558) Intergovernmental (73,150) Change in Net Position -Governmental Activities $ 659,713 The notes to the financial statements are an integral part of this statement. 48 City of Albertville, Minnesota Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual General Fund For the Year Ended December 31, 2020 General Budgeted Amounts Actual Variance with Original Final Amounts Final Budget Revenues Taxes $ 2,138,228 $ 2,138,228 $ 2,145,139 $ 6,911 Licenses and permits 158,500 158,500 300,888 142,388 Intergovernmental 228,510 228,510 840,195 611,685 Charges for services 725,263 725,263 1,063,090 337,827 Special assessments - - 28,905 28,905 Interest on investments 25,000 25,000 37,030 12,030 Miscellaneous 15,000 15,000 91,964 76,964 Total Revenues 3,290,501 3,290,501 4,507,211 1,216,710 Expenditures Current General government 803,981 803,981 876,331 (72,350) Public safety 1,582,390 1,582,390 1,629,347 (46,957) Public works 453,816 453,816 419,890 33,926 Culture and recreation 451,777 451,777 763,021 (311,244) Economic development 11,000 11,000 39,694 (28,694) Capital outlay General government - - 18,958 (18,958) Public safety - - 87,283 (87,283) Total Expenditures 3,302,964 3,302,964 3,834,524 (531,560) Net Change in Fund Balances (12,463) (12,463) 672,687 685,150 Fund Balances, January 1 2,617,925 2,617,925 2,617,925 - Fund Balances, December 31 $ 2,605,462 $ 2,605,462 $ 3,290,612 $ 685,150 The notes to the financial statements are an integral part of this statement. 49 City of Albertville, Minnesota Statement of Net Position Proprietary Funds December 31,2020 Business-type Activities-Enterprise Funds Sewer Water Storm Water Recycling Total Assets Current Assets Cash and temporary investments $ 7,906,656 $ 1,749,033 $ 1,164,257 $ 60,714 $ 10,880,660 Receivables Accounts 76,191 83,288 18,469 882 178,830 Delinquent special assessments 658 920 165 - 1,743 Special assessments,current portion 13,727 9,847 4,248 1,354 29,176 Due from other governments 1,961 11,391 - 3,196 16,548 Prepaid items 11,585 5,792 1,158 - 18,535 Total Current Assets 8,010,778 1,860,271 1,188,297 66,146 11,125,492 Noncurrent Assets Special assessments, net of current portion 57,455 14,311 6,691 91 78,548 Notes, net of current portion - - 32,144 - 32,144 Capital Assets Land 205,722 - 146,112 351,834 Buildings 4,706,359 13,330 - 4,719,689 Infrastructure 8,975,437 1,401,010 1,509,297 11,885,744 Machinery and equipment 184,305 134,193 - 318,498 Vehicles 186,363 216,921 69,177 472,461 Construction in progress 7,964,614 - - 7,964,614 Less:Accumulated depreciation (6,454,254) (778,774) (384,467) (7,617,495) Net Capital Assets 15,768,546 986,680 1,340,119 18,095,345 Total Noncurrent Assets 15,826,001 1,000,991 1,378,954 91 18,206,037 Total Assets 23,836,779 2,861,262 2,567,251 66,237 29,331,529 Deferred Outflows of Resources Deferred pension resources 21,739 31,674 16,882 - 70,295 The notes to the financial statements are an integral part of this statement. 50 City of Albertville, Minnesota Statement of Net Position(Continued) Proprietary Funds December 31,2020 Business-type Activities-Enterprise Funds Sewer Water Storm Water Recycling Total Liabilities Current Liabilities Accounts and contracts payable $ 82,622 $ 47,399 $ 11,827 $ 8,884 $ 150,732 Due to other governments - 51,085 - - 51,085 Accrued interest payable 58,144 871 2,000 - 61,015 Accrued salaries payable 5,296 7,869 4,203 213 17,581 Compensated absences payable,current portion 29,957 29,957 6,657 - 66,571 Bonds payable,current portion 500,900 9,100 75,000 - 585,000 Total Current Liabilities 676,919 146,281 99,687 9,097 931,984 Noncurrent Liabilities Compensated absences payable 9,986 9,986 2,219 - 22,191 Bonds payable 6,503,973 50,700 167,617 6,722,290 Net pension liability 115,121 167,738 89,119 371,978 Total Noncurrent Liabilities 6,629,080 228,424 258,955 7,116,459 Total Liabilities 7,305,999 374,705 358,642 9,097 8,048,443 Deferred Inflows of Resources Deferred pension resources 6,189 9,016 4,544 - 19,749 Net Position Net investment in capital assets 8,763,673 926,880 1,097,502 - 10,788,055 Unrestricted 7,782,657 1,582,335 1,123,445 57,140 10,545,577 Total Net Position $ 16,546,330 $ 2,509,215 $ 2,220,947 $ 57,140 $21,333,632 The notes to the financial statements are an integral part of this statement. 51 THIS PAGE IS LEFT BLANK INTENTIONALLY 52 City of Albertville, Minnesota Statement of Revenues, Expenses and Changes in Net Position Proprietary Funds For the Year Ended December 31, 2020 Business-type Activities - Enterprise funds Sewer Water Storm Water Recycling Total Operating Revenues Charges for services $ 849,707 $ 368,383 $ 222,037 $ 95,461 $ 1,535,588 Operating Expenses Personal services 295,557 209,587 145,328 8,105 658,577 Supplies 39,839 38,555 90 135 78,619 Professional services 58,052 38,203 30,613 3,317 130,185 Utilities 89,489 7,009 - - 96,498 Insurance 14,835 7,546 1,458 - 23,839 Repairs and maintenance 55,666 19,255 236 - 75,157 Remittance to Joint Powers Board - 8,037 - - 8,037 Depreciation 329,847 45,547 40,433 - 415,827 Other charges 74,294 41,974 68,641 105,807 290,716 Total Operating Expenses 957,579 415,713 286,799 117,364 1,777,455 Operating Loss (107,872) (47,330) (64,762) (21,903) (241,867) Nonoperating Revenues (Expenses) Property taxes 221,516 - - - 221,516 Interest income 154,382 36,049 27,304 1,407 219,142 Intergovernmental - - - 11,443 11,443 Interest expense and other (154,148) (2,113) (3,619) - (159,880) Other income 12,156 43,471 244 - 55,871 Total Nonoperating Revenues (Expenses) 233,906 77,407 23,929 12,850 348,092 Income (Loss) Before Contributions 126,034 30,077 (40,833) (9,053) 106,225 Contributions Capital contributions 1,123,220 74,992 3,492 1,461 1,203,165 Change in Net Position 1,249,254 105,069 (37,341) (7,592) 1,309,390 Net Position, January 1 15,297,076 2,404,146 2,258,288 64,732 20,024,242 Net Position, December 31 $ 16,546,330 $ 2,509,215 $ 2,220,947 $ 57,140 $ 21,333,632 The notes to the financial statements are an integral part of this statement. 53 City of Albertville, Minnesota Statement of Cash Flows Proprietary Funds For the Year Ended December 31,2020 Business-type Activities-Enterprise funds Sewer Water Storm Water Recycling Totals Cash Flows from Operating Activities Receipts from customers and users $ 862,274 $ 380,540 $ 223,641 $ 95,262 $ 1,561,717 Other receipts and payments, net 12,156 43,471 244 - 55,871 Payments to suppliers (343,902) (188,799) (90,342) (109,267) (732,310) Payments to employees (300,892) (207,463) (150,027) (7,892) (666,274) Net Cash Provided(Used)by Operating Activities 229,636 27,749 (16,484) (21,897) 219,004 Cash Flows from Noncapital Financing Activities Intergovernmental receipts - - 10,458 10,458 Tax receipts 221,516 - 221,516 Net Cash Provided by Noncapital Financing Activities 221,516 10,458 231,974 Cash Flows from Capital and Related Financing Activities Acquisition of capital assets (2,059,477) - - - (2,059,477) Capital contributions 1,508,926 63,807 5,968 1,461 1,580,162 Interest paid on bonds (148,695) (2,227) (5,550) - (156,472) Principal paid on bonds (575,900) (9,100) (75,000) - (660,000) Net Cash Provided(Used)by Capital and Related Financing Activities (1,275,146) 52,480 (74,582) 1,461 (1,295,787) Cash Flows from Investing Activities Interest received on investments 154,382 36,049 27,304 1,407 219,142 Net Increase(Decrease)in Cash and Cash Equivalents (669,612) 116,278 (63,762) (8,571) (625,667) Cash and Cash Equivalents,January 1 8,576,268 1,632,755 1,228,019 69,285 11,506,327 Cash and Cash Equivalents, December 31 $ 7,906,656 $ 1,749,033 $ 1,164,257 $ 60,714 $10,880,660 The notes to the financial statements are an integral part of this statement. 54 City of Albertville, Minnesota Statement of Cash Flows(Continued) Proprietary Funds For the Year Ended December 31,2020 Business-type Activities-Enterprise funds Sewer Water Storm Water Recycling Totals Reconciliation of Operating Income(Loss)to Net Cash Provided(Used)by Operating Activities Operating income(loss) $ (107,872) $ (47,330) $ (64,762) $ (21,903) $ (241,867) Adjustments to reconcile operating income(loss)to net cash provided(used)by operating activities Other income related to operations 12,156 43,471 244 55,871 Depreciation 329,847 45,547 40,433 - 415,827 (Increase)decrease in assets/deferred outflows of resources Accounts receivable 8,406 6,085 577 602 15,670 Prepaids 8,659 202 549 - 9,410 Due from other governments (1,961) (11,379) - - (13,340) Special assessments receivable 4,161 6,072 1,027 (801) 10,459 Deferred pension resources (5,332) (9,417) (4,394) - (19,143) Increase(decrease)in liabilities/deferred inflows of resources Accounts payable (18,425) (11,786) 10,147 (8) (20,072) Due to other governments - (5,257) - - (5,257) Accrued salaries payable 1,637 2,653 1,223 213 5,726 Compensated absences payable 2,972 2,972 660 - 6,604 Net pension liability 10,208 25,403 9,259 44,870 Deferred pension resources (14,820) (19,487) (11,447) (45,754) Net Cash Provided(Used)by Operating Activities $ 229,636 $ 27,749 $ (16,484) $ (21,897) $ 219,004 Schedule of Noncash Capital and Financing Activities Capital assets purchased on account $ 68,218 $ - $ - $ $ 68,218 Amortization of bond premiums $ 7,053 $ - $ 1,306 $ $ 8,359 The notes to the financial statements are an integral part of this statement. 55 City of Albertville, Minnesota Statement of Fiduciary Net Position Fiduciary Funds December 31, 2020 Custodial Funds Assets Cash and temporary investments $ 284,078 Accounts receivable 140,249 Inventory 2,178 Total Assets 426,505 Liabilities Accounts payable 14,650 Accrued wages 5,981 Total Liabilities 20,631 Net Position Restricted for organizations and other governments $ 405,874 The notes to the financial statements are an integral part of this statement. 56 City of Albertville, Minnesota Statement of Changes in Fiduciary Net Position Fiduciary Funds For the Year Ended December 31, 2020 Custodial Funds Additions Contributions Charges for services $ 501,307 Donations 45,000 Concessions 40,914 Total Contributions 587,221 Investment earnings Interest, dividends and other 8,539 Miscellaneous 35,844 Total Additions 631,604 Deductions Professional services 361,203 Supplies 14,550 Utilities 164,662 Insurance 13,200 Repairs and Maintenance 47,142 Capital Outlay 14,712 Miscellaneous 21,222 Total Deductions 636,691 Net Increase (Decrease) in Fiduciary Net Position (5,087) Net Position, January 1 410,961 Net Position, December 31 $ 405,874 The notes to the financial statements are an integral part of this statement. 57 THIS PAGE IS LEFT BLANK INTENTIONALLY 58 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 1: Summary of Significant Accounting Policies A. Reporting Entity The City of Albertville, Minnesota (the City) operates under the "Optional Plan A" form of government as defined in the State of Minnesota statutes. Under this plan, the government of the City is directed by a City Council composed of an elected Mayor and four elected City Council members. The City Council exercises legislative authority and determines all matters of policy. The City Council appoints personnel responsible for the proper administration of all affairs relating to the City. The City has considered all potential units for which it is financially accountable, and other organizations for which the nature and significance of their relationship with the City are such that exclusion would cause the City's financial statements to be misleading or incomplete. The Governmental Accounting Standards Board (GASB) has set forth criteria to be considered in determining financial accountability. These criteria include appointing a voting majority of an organization's governing body, and (1) the ability of the primary government to impose its will on that organization or (2) the potential for the organization to provide specific benefits to, or impose specific financial burdens on the primary government. Blended Component Unit The Albertville Economic Development Authority (EDA) is a legal separate entity created to carry out economic development activities. The EDA is governed by five members, which consists of the City Council and the operational responsibility for the EDA rests with the management of the City. The criterion that results in the EDA being reported as a blended component unit include 1) the five board members are members of the City Council and 2) the operational responsibility of the EDA rests with the management of the City. The EDA does not issue separate financial statements and are included in the financial section of this report. B. Government-wide and Fund Financial Statements The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the nonfiduciary activities of the City. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Amounts reported as program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds, proprietary funds and fiduciary funds. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. 59 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 1: Summary of Significant Accounting Policies (Continued) 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 City considers revenues to be available if they are collected within 60 days 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, franchise taxes, licenses 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 City. Revenue resulting from exchange transactions, in which each party gives and receives essentially equal value, is recorded on the accrual basis when the exchange takes place. On a modified accrual basis, revenue is recorded in the year in which the resources are measurable and become available. Non-exchange transactions, in which the City receives value without directly giving equal value in return, include property taxes, grants, entitlement and donations. On an accrual basis, revenue from property taxes is recognized in the year for which the tax is levied. Revenue from grants, entitlements and donations is recognized in the year in which all eligibility requirements have been satisfied. Eligibility requirements include timing requirements, which specify the year when the resources are required to be used or the year when use is first permitted, matching requirements, in which the City must provide local resources to be used for a specified purpose, and expenditure requirements, in which the resources are provided to the City on a reimbursement basis. On a modified accrual basis, revenue from non-exchange transactions must also be available before it can be recognized. Unearned revenue arises when assets are recognized before revenue recognition criteria have been satisfied. Grants and entitlements received before eligibility requirements are met are also recorded as unearned revenue. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. The City reports the following major governmental funds: The General fund is the City's primary operating fund. It accounts for all financial resources of the City, except those required to be accounted for in another fund. The Debt Service fund accounts for the accumulation of resources and payment of bond principal and interest on long-term general obligation debt of governmental funds. The Capital Outlay Reserve fund accounts for the accumulation of resources necessary to fund future capital improvements and equipment purchases. 60 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 1: Summary of Significant Accounting Policies (Continued) The City reports the following major proprietary funds: The Sewer fund accounts for the activities of the City's sewage collection utility. The Water fund accounts for the activities of the City's water utility. The Storm Water fund accounts for the activities of the City's storm drainage utility. The Recycling fund accounts for the activities of the City's recycling operations. Additionally, the City reports the following fund types: Fiduciary Funds Custodial funds are used to report fiduciary activities that are not required to be reported in pension (and other employee benefit)trust funds, investment trust funds, or private-purpose trust funds. The City's Custodial fund accounts for activities of St. Michael-Albertville Ice Arena, Albertville Lions, and Friendly City Days. As a general rule, the effect of interfund activity has been eliminated from government-wide financial statements. Exceptions to this general rule are charges between the City's water and sewer functions and various other functions of the City. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the City 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. 61 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 1: Summary of Significant Accounting Policies (Continued) D. Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources and Net Position/Fund Balances Deposits and Investments The City's cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition. The proprietary funds' portion in the government-wide cash and temporary investments pool is considered to be cash and cash equivalents for purposes of the statement of cash flows. Cash balances from all funds are pooled and invested, to the extent available, in certificates of deposit and other authorized investments. Earnings from such investments are allocated on the basis of applicable participation by each of the funds. The City may also invest idle funds as authorized by Minnesota statutes, as follows: 1. Direct obligations or obligations guaranteed by the United States or its agencies. 2. Shares of investment companies registered under the Federal Investment Company Act of 1940 and received the highest credit rating, rated in one of the two highest rating categories by a statistical rating agency, and have a final maturity of thirteen months or less. 3. General obligations of a state or local government with taxing powers rated "A" or better; revenue obligations rated "AK or better. 4. General obligations of the Minnesota Housing Finance Agency rated "A" or better. 5. Obligation of a school district with an original maturity not exceeding 13 months and (i) rated in the highest category by a national bond rating service or(ii) enrolled in the credit enhancement program pursuant to statute section 126C.55. 6. Bankers' acceptances of United States banks eligible for purchase by the Federal Reserve System. 7. Commercial paper issued by United States banks corporations or their Canadian subsidiaries, of highest quality category by at least two nationally recognized rating agencies, and maturing in 270 days or less. 8. Repurchase or reverse repurchase agreements and securities lending agreements with financial institutions qualified as a "depository" by the government entity, 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, or certain Minnesota securities broker-dealers. 9. Guaranteed Investment Contracts (GIC's) issued or guaranteed by a United States commercial bank, a domestic branch of a foreign bank, a United States insurance company, or its Canadian subsidiary, whose similar debt obligations were rated in one of the top two rating categories by a nationally recognized rating agency. Broker money market funds operate in accordance with appropriate state laws and regulations. The reported value of the pool is the same as the fair value of the shares. The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. 62 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 1: Summary of Significant Accounting Policies (Continued) The City has the following recurring fair value measurements as of December 31, 2020: • Brokered Certificates of Deposit of$5,062,885 are valued using quoted market prices (Level 2 inputs) • Municipal Bonds of$3,004,488 are values using a matrix pricing model (Level 2 inputs) The Minnesota Municipal Money Market Fund is regulated by Minnesota statutes and the Board of Directors of the League of Minnesota Cities and is an external investment pool not registered with the Securities Exchange Commission (SEC)that follows the regulatory rules of the SEC. In accordance with GASB Statement No. 79, the City's investment in this pool is valued at amortized cost, which approximates fair value. There are no restrictions or limitations on withdrawals from the 4M Liquid Asset Fund. Investments in the 4M Plus must be deposited for a minimum of 14 calendar days. Withdrawals prior to the 14-day restriction period will be subject to a penalty equal to seven days interest on the amount withdrawn. Seven days' notice of redemption is required for withdrawals of investments in the 4M Term Series withdrawn prior to the maturity date of that series. A penalty could be assessed as necessary to recoup the Series for any charges, losses, and other costs attributable to the early redemption. Financial statements of the 4M Fund can be obtained by contracting RBC Global Management at 100 South Fifth Street, Suite 2300, Minneapolis, MN 55402-1240. Investment Policy The City's investment policy incorporates Minnesota statutes as described above which reduces the City's exposure to credit, custodial credit and interest rate risks. Specific risk information for the City is as follows: • Credit Risk. Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. Ratings are provided by various credit rating agencies and where applicable, indicate associated credit risk. Minnesota statutes and the City's investment policy limit the City's investments to the list above. • Custodial Credit Risk. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty to a transaction, a government will not be able to recover the value of investment or collateral securities that are in the possession of an outside party. The City's investments held by the broker-dealer were insured by SI PC or other supplemental insurance as of December 31, 2020. However, each investment brokerage firm may have a limit to their supplemental insurance and because of the size of the City's portfolio in relation to the brokerage firm's excess SIPC coverage limits the portion of the supplemental policy applicable to the City's portfolio is unknown. The City's investment policy does not address custodial credit risk. The City accepts the risk due to the controls in place at the broker-dealer. • Concentration of Credit Risk. Concentration of credit risk is the risk of loss attributed to the magnitude of a government's investment in a single issuer. In accordance with the City's investment policy, the City diversifies its investment portfolio to eliminate the risk of loss resulting from over-concentration of assets in a specific maturity, a specific issuer or a specific class of securities. The maturities selected shall provide for stability of income and reasonable liquidity. • Interest Rate Risk. Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. In accordance with its investment policy, the City will attempt to match its investments with anticipated cash flow requirements. Unless matched to a specific cash flow, the City will not directly invest in securities maturing more than an average expected life of ten years from the date of the purchase. 63 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 1: Summary of Significant Accounting Policies (Continued) Property Taxes The City Council annually adopts a tax levy in December and certifies it to the County for collection in the following year. The County is responsible for collecting all property taxes for the City. These taxes attach an enforceable lien on taxable property within the City on January 1 and are payable by the property owners in two installments. The taxes are collected by the County Auditor and tax settlements are made to the City during January, June, and November each year. Delinquent taxes receivable include the past six years' uncollected taxes. Delinquent taxes have been offset by a deferred inflow of resources for taxes not received within 60 days after year end in the fund financial statements. Accounts Receivable Accounts receivable include amounts billed for services provided before year end. To the extent considered necessary, the City annually certifies delinquent water, sewer and storm water accounts to the County for collection in the following year. Therefore, there has been no allowance for doubtful accounts established. Special Assessments Special assessments represent the financing for public improvements paid for by benefiting property owners. These assessments are recorded as receivables upon certification to the County. Special assessments are recognized as revenue when they are received in cash or within 60 days after year end. All governmental fund special assessments receivable are offset by a deferred inflow of resources in the fund financial statements. Interfund Receivables and Payables All outstanding balances between funds are reported as "due to/from other funds" or"advances to/from other funds." Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as "internal balances." Land Held for Resale The City acquires properties for redevelopment purposes. These properties are reported at their net realizable value in the financial statements. Any costs incurred that are above a property's net realizable value are reported as expenditures of the current period. The balance of land held for resale is offset with nonspendable or restricted fund balance to indicate that it is not available for appropriation. Notes Receivable Notes receivable include amounts paid by or loaned by the City that will be paid back by other entities. Inventories Inventories held for resale are stated at the lower of cost or market on the first-in, first-out (FIFO) method and inventories of supplies are reported at cost. Inventories in governmental funds are recorded as expenditures when consumed rather than when purchased. 64 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 1: Summary of Significant Accounting Policies (Continued) Capital Assets Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads, bridges, sidewalks, and similar items) are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Capital assets are defined by the City as assets with an estimated useful life of more than one year and an initial individual cost of more than the following: Category Cost Land/Land Improvements $ 10,000 Other Improvements 25,000 1 nfrastructure 100,000 Buildings 25,000 Building Improvements 25,000 Vehicles 5,000 Other Equipment 5,000 Intangible Assets 10,000 The City reports infrastructure assets on a network and subsystem basis. Accordingly, the amounts spent for the construction or acquisition of infrastructure assets are capitalized and reported in the government-wide financial statements regardless of their amount. In the case of initial capitalization of general infrastructure assets (i.e., those reported by governmental activities) the City chose to include items dating back to June 30, 1980. The City was able to estimate the historical cost for the initial reporting of these assets through back trending (i.e., estimating the current replacement cost of the infrastructure to be capitalized and using an appropriate price-level index to deflate the cost to the acquisition year or estimated acquisition year). As the City constructs or acquires capital assets each period, including infrastructure assets, they are capitalized and reported at historical cost. The reported value excludes normal maintenance and repairs which are essentially amounts spent in relation to capital assets that do not increase the capacity or efficiency of the item or extend its useful life beyond the original estimate. In the case of donations, the City values these capital assets at the acquisition value of the item at the date of its donation. Property, plant and equipment will be depreciated using the straight-line method over the following estimated useful lives: Useful Lives Assets in Years Land Improvements 5 to 30 Infrastructure 15 to 50 Buildings 15 to 40 Vehicles 3 to 15 Other Equipment 3 to 20 65 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 1: Summary of Significant Accounting Policies (Continued) Deferred Outflows of Resources In addition to assets, the statement of net position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The City has two items that qualify for reporting in this category. The loss on refunding bonds reported in the government-wide statement of net position. A loss on refunding results from the difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunded or refunding debt. The item, deferred pension resources, is reported only in the statements of net position. This item results from actuarial calculations and current year pension contributions made subsequent to the measurement date. Pensions For purposes of measuring the net pension liability, deferred outflows/inflows of resources, and pension expense, information about the fiduciary net position of the Public Employees Retirement Association (PERA) and additions to/deductions from PERA's fiduciary net position have been determined on the same basis as they are reported by PERA except that PERA's fiscal year end is June 30. For this purpose, plan contributions are recognized as of employer payroll paid dates and benefit payments and refunds are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. The General fund is typically used to liquidate the governmental net pension liability. For purposes of measuring the net pension liability (asset) and deferred outflows of resources related to pensions, and pension expense, information about the fiduciary net position of the defined benefit plan administered by the Albertville Firefighter's Relief Association and additions to and deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. Investments are reported at fair value. The total pension expense for the GERP, PEPFP and the Albertville Fire Relief Association is as follows: Total GERP PEPFP FRA Pension Expense Pension Expense $ 71,306 $ 27,889 $ 30,253 $ 129,448 Compensated Absences It is the City's policy to permit employees to accumulate earned but unused vacation and sick pay benefits. All vacation and sick pay is accrued when incurred in the government-wide and proprietary fund financial statements. A liability for these amounts is reported in governmental funds only if they have matured, for example, as a result of employee resignations and retirements. The General fund is typically used to liquidate the governmental compensated absences liability. Long-term Obligations In the government-wide financial statements, and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type statement of net position. The recognition of bond premiums and discounts are amortized over the life of the bonds using the straight line method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are reported as an expense in the period incurred. In the fund financial statements, governmental fund types recognized 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. 66 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 1: Summary of Significant Accounting Policies (Continued) Deferred Inflows of Resources In addition to liabilities, the statement of net position and fund financial statements will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The City has only one type of item, which arises only under a modified accrual basis of accounting that qualifies for reporting in this category. Accordingly, the item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from three sources: property taxes, special assessments and notes/intergovernmental receivable. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available. The City has an additional item which qualifies for reporting in this category. The item, deferred pension resources, is reported only in the statements of net position and results from actuarial calculations. Fund Balance In the fund financial statements, fund balance is divided into five classifications based primarily on the extent to which the City is bound to observe constraints imposed upon the use of resources reported in the governmental funds. These classifications are defined as follows: Nonspendable -Amounts that cannot be spent because they are not in spendable form, such as land held for resale. Restricted-Amounts related to externally imposed constraints established by creditors, grantors or contributors; or constraints imposed by state statutory provisions. Committed-Amounts constrained for specific purposes that are internally imposed by formal action (resolution) of the City Council, which is the City's highest level of decision-making authority. Committed amounts cannot be used for any other purpose unless the City Council modifies or rescinds the commitment by resolution. Assigned-Amounts constrained for specific purposes that are internally imposed. In governmental funds other than the General fund, assigned fund balance represents all remaining amounts that are not classified as nonspendable and are neither restricted nor committed. In the General fund, assigned amounts represent intended uses established by the City Council itself or by an official to which the governing body delegates the authority. The City Council has adopted a fund balance policy which delegates the authority to assign amounts for specific purposes to the Finance Director and/or City Administrator. Unassigned-The residual classification for the General fund and also negative residual amounts in other funds. The City considers restricted amounts to be spent first when both restricted and unrestricted fund balance is available. Additionally, the City would first use committed, then assigned, and lastly unassigned amounts of unrestricted fund balance when expenditures are made. The City has formally adopted a fund balance policy for the General fund. The City's policy is to maintain a minimum unassigned fund balance of 35 percent of next year's budgeted operating expenditures for cash-flow timing needs. 67 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 1: Summary of Significant Accounting Policies (Continued) Net Position Net position represents the difference between assets and deferred outflows of resources and liabilities and deferred inflows of resources. Net position is displayed in three components: a. Net investment in capital assets - Consists of capital assets, net of accumulated depreciation reduced by any outstanding debt attributable to acquire capital assets. b. Restricted net position - Consist of net position restricted when there are limitations imposed on their use through external restrictions imposed by creditors, grantors, laws or regulations of other governments. c. Unrestricted net position -All other net positions that do not meet the definition of"restricted" or"net investment in capital assets". When both restricted and unrestricted resources are available for use, it is the City's policy to use restricted resources first, then unrestricted resources as they are needed. Note 2: Stewardship, Compliance and Accountability A. Budgetary Information An annual budget is adopted on a basis consistent with accounting principles generally accepted in the United States of America for the General fund. All annual appropriations lapse at fiscal year-end. The City does not use encumbrance accounting. In June of each year, all departments of the City submit requests for appropriations to the City Administrator so that a budget may be prepared. Before September 30, the proposed budget is presented to the City Council for review. The City Council holds public hearings and a final budget is prepared and adopted in early December. The appropriated budget is prepared by fund, function and department. The City's department heads, with the approval of the City Administrator, may make transfers of appropriations within a department. Transfers of appropriations between departments require the approval of the City Council. The legal level of budgetary control is the department level. Budgeted amounts are as originally adopted by the City Council. There were no budget amendments made in 2020. B. Deficit Fund Equity The following funds had deficit fund balances as of December 31, 2020: Fund Amount Nonmajor TIF #17 Old Castle $ 386,721 TIF #16 Mold Tech 31085 The deficit fund balances will be eliminated with transfers from other funds and future tax increment. 68 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 2: Stewardship, Compliance and Accountability C. Excess of Expenditures over Appropriations For the year ended December 31, 2020 expenditures exceed appropriations in the following fund: Excess of Expenditures Final Over Fund Budget Actual Appropriations General $ 3,302,964 $ 3,834,524 $ 531,560 The excess of expenditures over appropriations was funded by revenues in excess of budget. Note 3: Detailed Notes on All Funds A. Deposits and Investments Deposits Custodial credit risk for deposits and investments is the risk that in the event of a bank failure, the City's deposits and investments may not be returned or the City will not be able to recover collateral securities in the possession of an outside party. In accordance with Minnesota statutes and as authorized by the City Council, the City maintains deposits at those depository banks, all of which are members of the Federal Reserve System. Minnesota statutes require that all City deposits be protected by insurance, surety bond or collateral. The fair value of collateral pledged must equal 110 percent of the deposits not covered by insurance or bonds, with the exception of irrevocable standby letters of credit issued by Federal Home Loan Banks as this type of collateral only requires collateral pledged equal to 100 percent of the deposits not covered by insurance or bonds. Authorized collateral in lieu of a corporate surety bond includes: • United States government Treasury bills, Treasury notes, Treasury bonds; • Issues of United States government agencies and instrumentalities as quoted by a recognized industry quotation service available to the government entity; • General obligation securities of any state or local government with taxing powers which is rated "A" or better by a national bond rating service, or revenue obligation securities of any state or local government with taxing powers which is rated "AK or better by a national bond rating service; • General obligation securities of a local government with taxing powers may be pledged as collateral against funds deposited by that same local government entity; • Irrevocable standby letters of credit issued by Federal Home Loan Banks to a municipality accompanied by written evidence that the bank's public debt is rated "AK or better by Moody's Investors Service, Inc., or Standard & Poor's Corporation; and • Time deposits that are fully insured by any federal agency. Minnesota statutes require that all collateral shall be placed in safekeeping in a restricted account at a Federal Reserve Bank, or in an account at a trust department of a commercial bank or other financial institution that is not owned or controlled by the financial institution furnishing the collateral. The selection should be approved by the government entity. 69 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 3: Detailed Notes on All Funds (Continued) At year end, the City's carrying amount of deposits was $2,061,384 and the bank balance was $2,185,031. Of the bank balance, $500,000 as covered by federal depository insurance and the remaining was covered by collateral held by the City's agent in the City's name. Investments As of December 31, 2020, the City had the following investments: Credit Segmented Quality/ Time Fair Value Measurement Using Types of Investments Ratings(1) Distribution (2) Amounts Level 1 Level 2 Level 3 Pooled Investments at Amortized Costs 4M Fund N/A Less than 1 year $ 5,769,602 Broker Money Market Funds N/A Less than 1 year 4,686,890 Non-pooled Investments at Fair Value Brokered Certificates of Deposit N/A Less than 1 year 1,002,143 $ - $ 1,002,143 $ - Brokered Certificates of Deposit N/A 1 to 5 years 4,060,742 - 4,060,742 - Municipal Bonds AAA Less than 1 year 253,948 - 253,948 - Municipal Bonds AAA 1 to 5 years 681,108 - 681,108 - Municipal Bonds AA+ 1 to 5 years 204,922 - 204,922 - Municipal Bonds AA Less than 1 year 402,022 - 402,022 - Municipal Bonds AA 1 to 5 years 1,462,488 - 1,462,488 - Total Investments $18,523,865 $ - $ 8,067,373 $ - (1) Ratings are provided by various credit rating agencies where applicable to indicate associated credit risk. (2) Interest rate risk is disclosed using the segmented time distribution method. N/A Indicates not applicable or available. Cash and Investments Summary A reconciliation of cash and temporary investments as shown on the financial statements for the City follows: Carrying Amount of Deposits $ 2,061,384 Investments 18,523,865 Cash on Hand 849 Total $ 20,586,098 Cash and Investments Statement of net position Cash and temporary investments $ 20,302,020 Statement of Fiduciary net position 284,078 Total $ 20,586,098 70 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 3: Detailed Notes on All Funds (Continued) B. Capital Assets Capital asset activity for the year ended December 31, 2020 was as follows: Beginning Ending Balance Increases Decreases Balance Governmental Activities Capital Assets not Being Depreciated Land $ 3,983,292 $ - $ - $ 3,983,292 Construction in progress - 845,292 - 845,292 Total Capital Assets not Being Depreciated 3,983,292 845,292 - 4,828,584 Capital Assets Being Depreciated Buildings 6,543,862 - - 6,543,862 Infrastructure 30,595,849 701,652 - 31,297,501 Land improvements 2,768,857 - - 2,768,857 Machinery and equipment 1,186,270 136,423 - 1,322,693 Vehicles 2,511,193 105,034 - 2,616,227 Total Capital Assets Being Depreciated 43,606,031 943,109 - 44,549,140 Less Accumulated Depreciation for Buildings (2,297,678) (160,347) - (2,458,025) Infrastructure (19,344,901) (1,007,550) - (20,352,451) Land improvements (1,412,954) (121,045) - (1,533,999) Machinery and equipment (424,341) (100,411) - (524,752) Vehicles (820,777) (148,810) - (969,587) Total Accumulated Depreciation (24,300,651) (1,538,163) - (25,838,814) Total Capital Assets Being Depreciated, Net 19,305,380 (595,054) - 18,710,326 Governmental Activities Capital Assets, Net $ 23,288,672 $ 250,238 $ - $ 23,538,910 71 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 3: Detailed Notes on All Funds (Continued) Beginning Ending Balance Increases Decreases Balance Business-type Activities Capital Assets not Being Depreciated Land $ 351,834 $ - $ - $ 351,834 Construction in progress 6,590,589 1,374,026 - 7,964,615 Total Capital Assets not Being Depreciated 6,942,423 1,374,026 - 8,316,449 Capital Assets Being Depreciated Buildings 4,719,693 - - 4,719,693 Infrastructure 11,885,741 - - 11,885,741 Machinery and equipment 318,497 - - 318,497 Vehicles 472,461 - - 472,461 Total Capital Assets Being Depreciated 17,396,392 - - 17,396,392 Less Accumulated Depreciation for Buildings (1,641,515) (117,992) - (1,759,507) Infrastructure (4,875,092) (262,640) - (5,137,732) Machinery and equipment (276,601) (18,973) - (295,574) Vehicles (408,460) (16,222) - (424,682) Total Accumulated Depreciation (7,201,668) (415,827) - (7,617,495) Total Capital Assets Being Depreciated, Net 10,194,724 (415,827) - 9,778,897 Business-type Activities Capital Assets, Net $ 17,137,147 $ 958,199 $ - $ 18,095,346 Depreciation expense was charged to functions/programs of the City as follows: Governmental Activities General government $ 157,523 Public safety 148,580 Public works 1,109,572 Culture and recreation 122,488 Total Depreciation Expense- Governmental Activities $ 1,538,163 Business-type Activities Sewer $ 329,847 Water 45,547 Storm water 40,433 Total Depreciation Expense- Business-type Activities $ 415,827 72 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 3: Detailed Notes on All Funds (Continued) C. Advances to/from other Funds and Transfers The composition of interfund balances as of December 31, 2020 is as follows: Receivable Fund Payable Fund Amount Debt Service Other Governmental Funds $ 393,595 The above funds advanced the above balances to eliminate their deficit cash balances and finance capital projects. Interest is charged at 4 percent interest rate. D. Long-term Debt General Obligation Bonds The City issues general obligation bonds to provide funds for the acquisition and construction of major capital facilities. General obligation bonds have been issued for both governmental activities and business-type activities. These bonds are reported in the proprietary funds if they are expected to be repaid from proprietary fund revenues. General obligation bonds are direct obligations of the City and pledge the full faith and credit of the City. General Obligation Special Assessment Bonds and Improvement Notes The following bonds were issued to finance various improvement projects in the City and will be repaid with the collection of special assessment levies. Interest Issue Maturity Balance at Description Authorized Issued Rate Date Date Year End G.O. Improvement Refunding Bonds, Series 2011C $ 1,825,000 $ 1,825,000 2.00 - 3.35 % 08/25/11 02/01/25 $ 725,000 G.O. Improvement Refunding Bonds, Series 2012A 2,310,000 2,310,000 1.00 - 2.00 04/10/12 02/01/23 1,125,000 G.O. Improvement Refunding Bonds, Series 2012B 3,215,000 3,215,000 0.50 - 2.35 05/10/12 12/01/25 1,225,000 General Obligation Improvement Note, Series 2012 4,113,700 3,278,551 1.277 03/23/12 08/20/32 2,238,000 Total G.O. Special Assessment Bonds and Improvement Notes $ 5,313,000 73 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 3: Detailed Notes on All Funds (Continued) Annual debt service requirements to maturity for general obligation special assessment bonds are as follows: Year Ending Governmental Activities Business-type Activities December 31, Principal Interest Total Principal Interest Total 2021 $ 864,000 $ 89,561 $ 953,561 $ 75,000 $ 4,050 $ 79,050 2022 876,000 72,587 948,587 80,000 2,500 82,500 2023 813,000 55,649 868,649 85,000 850 85,850 2024 581,000 41,047 622,047 - - - 2025 593,000 28,114 621,114 - -2026 -2030 949,000 62,024 1,011,024 - - - 2031 -2032 397,000 7,623 404,623 - - - Total $ 5,073,000 $ 356,605 $ 5,429,605 $ 240,000 $ 7,400 $ 247,400 General Obligation Revenue Bonds The following bonds were issued to finance capital improvements in the enterprise funds. They will be repaid from future net operating revenues and transfers in from the enterprise funds and are backed by the taxing power of the City. Annual net operating revenues and transfers in, principal and interest payments, and the percentage of revenue required to cover principal and interest payment are as follows: Sewer Water Storm Water Net Operating Revenues $ 849,707 $ 368,383 $ 222,037 Principal and Interest 724,595 11,327 80,550 Percentage of Revenues 85% 3% 36% The components of the general obligation revenues bonds are as follows: Authorized Interest Issue Maturity Balance at Description and Issued Rate Date Date Year End G.O. Utility Revenue Bonds, Series 2011 A $ 520,000 1.10 - 3.70 % 04/21/11 02/01/26 $ 230,000 G.O. Sewer Revenue Refunding Bonds, Series 2013A 2,515,000 .70 - 2.10 01/24/13 12/01/25 1,300,000 G.O. Sewer Revenue Series 2019A 5,720,000 2.00 - 3.00 09/24/19 02/01/39 5,415,000 Total G.O. Revenue Bonds $ 6,945,000 74 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 3: Detailed Notes on All Funds (Continued) Annual debt service requirements to maturity for general obligation revenue bonds are as follows: Year Ending Business-type Activities December 31, Principal Interest Total 2021 $ 510,000 $ 156,824 $ 666,824 2022 520,000 145,004 665,004 2023 540,000 132,344 672,344 2024 550,000 118,969 668,969 2025 560,000 104,764 664,764 2026 -2030 1,410,000 377,910 1,787,910 2031 -2035 1,520,000 227,123 1,747,123 2036 -2039 1,335,000 60,619 1,395,619 Total $ 6,945,000 $ 1,323,557 $ 8,268,557 Changes in Long-term Liabilities Long-term liability activity for the year ended December 31, 2020 was as follows: Beginning Ending Due Within Balance Increases Decreases Balance One Year Governmental Activities Bonds Payable G.O. Special Assessment bonds $ 5,929,000 $ - $ (856,000) $ 5,073,000 $ 864,000 Unamortized premium 38,076 - (6,732) 31,344 - Total Bonds Payable 5,967,076 - (862,732) 5,104,344 864,000 Compensated Absences Payable 177,345 61,045 (84,316) 154,074 115,556 Governmental Activity Long-term Liabilities $ 6,144,421 $ 61,045 $ (947,048) $ 5,258,418 $ 979,556 Business-type Activities Bonds Payable G.O. Revenue bonds $ 7,530,000 $ - $ (585,000) $ 6,945,000 $ 510,000 Unamortized premium 126,726 - (7,053) 119,673 - G.O. Special Assessment bonds 315,000 - (75,000) 240,000 75,000 Unamortized premium 3,923 - (1,306) 2,617 - Total Bonds Payable 7,975,649 - (668,359) 7,307,290 585,000 Compensated Absences Payable 82,158 42,786 (36,182) 88,762 66,571 Business-type Activity Long-term Liabilities $ 8,057,807 $ 42,786 $ (704,541) $ 7,396,052 $ 651,571 In the event an employee of the City would retire or resign, in good standing, a portion of the governmental compensated absences would mature. The portion applicable to that employee would be recorded as a liability and would be liquidated through the General fund. 75 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 3: Detailed Notes on All Funds (Continued) E. Components of Fund Balance At December 31, 2020, portions of the City's fund balance are not available for appropriation due to not being in spendable form (Nonspendable), legal restrictions (Restricted), City Council action (Committed), policy and/or intent (Assigned). The following is a summary of the components of fund balance: Fund Purpose Amount Nonspendable General Land held for resale $ 51,000 General Prepaid items 39,389 Total Nonspendable 90,389 Restricted Debt Service Debt Service 3,247,679 Other governmental funds Tax increment financing 140,572 Other governmental funds Park improvements 229 Total Restricted 3,388,480 Commited Other governmental funds Revolving loan 156,143 Assigned Capital Outlay Reserve Future capital projects 3,965,154 Unassigned General 3,200,223 Other governmental funds (389,806) Total Unassigned 2,810,417 Total $ 10,410,583 Note 4: Defined Benefit Pension Plans - Statewide A. Plan Description The City participates in the following cost-sharing multiple-employer defined benefit pension plans administered by the Public Employees Retirement Association of Minnesota (PERA). PERA's defined benefit pension plans are established and administered in accordance with Minnesota statutes, chapters 353 and 356. PERA's defined benefit pension plans are tax qualified plans under Section 401(a) of the Internal Revenue Code. General Employees Plan All full-time and certain part-time employees of the City are covered by the General Employees Plan. General Employees Plan members belong to the Coordinated Plan. Coordinated Plan members are covered by Social Security. Public Employees Police and Fire Plan The Police and Fire Plan, originally established for police officers and firefighters not covered by a local relief association, now covers all police officers and firefighters hired since 1980.Effective July 1, 1999, the Police and Fire Plan also covers police officers and firefighters belonging to a local relief association that elected to merge with and transfer assets and administration to PERA. 76 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 4: Defined Benefit Pension Plans - Statewide (Continued) B. Benefits Provided PERA provides retirement, disability and death benefits. Benefit provisions are established by state statute and can only be modified by the state legislature. Vested, terminated employees who are entitled to benefits but are not receiving them yet are bound by the provisions in effect at the time they last terminated their public service. General Employees Plan Benefits General Employees Plan benefits are based on a member's highest average salary for any five successive years of allowable service, age, and years of credit at termination of service. Two methods are used to compute benefits for PERA's Coordinated Plan members. Members hired prior to July 1, 1989 receive the higher of Method 1 or Method 2 formulas. Only Method 2 is used for members hired after June 30, 1989. Under Method 1, the accrual rate for Coordinated members is 1.2 percent of average salary for each of the first 10 years of service and 1.7 percent of average salary for each additional year. Under Method 2, the accrual rate for Coordinated members is 1.7 percent of average salary for all years of service. For members hired prior to July 1, 1989 a full annuity is available when age plus years of service equal 90 and normal retirement age is 65. For members hired on or after July 1, 1989 normal retirement age is the age for unreduced Social Security benefits capped at 66. Benefit increases are provided to benefit recipients each January. Beginning in 2019, the postretirement increase will be equal to 50 percent of the cost-of-living adjustment (COLA) announced by the SSA, with a minimum increase of at least 1 percent and a maximum of 1.5 percent. Recipients that have been receiving the annuity or benefit for at least a full year as of the June 30 before the effective date of the increase will receive the full increase. For recipients receiving the annuity or benefit for at least one month but less than a full year as of the June 30 before the effective date of the increase will receive a reduced prorated increase. For members retiring on January 1, 2024, or later, the increase will be delayed until normal retirement age (age 65 if hired prior to July 1, 1989, or age 66 for individuals hired on or after July 1, 1989). Members retiring under Rule of 90 are exempt from the delay to normal retirement. Police and Fire Plan Benefits Benefits for Police and Fire Plan members first hired after June 30, 2010, but before July 1, 2014 vest on a prorated basis from 50 percent after five years up to 100 percent after ten years of credited service. Benefits for Police and Fire Plan members first hired after June 30, 2014 vest on a prorated basis from 50 percent after ten years up to 100 percent after twenty years of credited service. The annuity accrual rate is 3 percent of average salary for each year of service. For Police and Fire Plan members who were first hired prior to July 1, 1989, a full annuity is available when age plus years of service equal at least 90. Benefit increases are provided to benefit recipients each January. Beginning in 2019, the postretirement increase will be fixed at 1 percent. Recipients that have been receiving the annuity or benefit for at least 36 months as of the June 30 before the effective date of the increase-will receive the full increase. For recipients receiving the annuity or benefit for at least 25 months but less than 36 months as of the June 30 before the effective date of the increase will receive a reduced prorated increase. C. Contributions Minnesota statutes chapter 353 sets the rates for employer and employee contributions. Contribution rates can only be modified by the state Legislature. General Employees Fund Contributions Coordinated Plan members were required to contribute 6.50 percent of their annual covered salary in fiscal year 2020 and the City was required to contribute 7.50 percent for Coordinated Plan members in fiscal year 2020. The City's contributions to the General Employees Fund for the years ending December 31, 2020, 2019 and 2018 were $95,790, $90,361 and $77,347, respectively. The City's contributions were equal to the required contributions for each year as set by state statute. 77 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 4: Defined Benefit Pension Plans - Statewide (Continued) Police and Fire Fund Contributions Police and Fire member's contribution rates increased from 11.30 percent of pay to 11.80 percent and employer rates increased from 16.95 percent to 17.70 percent on January 1, 2020. The City's contributions to the Police and Fire Fund for the years ending December 31, 2020, 2019 and 2018 were $20,812, $17,055 and $15,197, respectively. The City's contributions were equal to the required contributions for each year as set by state statute. D. Pension Costs General Employees Fund Pension Costs At December 31, 2020, the City reported a liability of$1,043,210 for its proportionate share of the General Employees Fund's net pension liability. The City's net pension liability reflected a reduction due to the State of Minnesota's contribution of$16 million. The State of Minnesota is considered a non-employer contributing entity and the state's contribution meets the definition of a special funding situation. The State of Minnesota's proportionate share of the net pension liability associated with the City totaled $32,283. The net pension liability was measured as of June 30, 2020, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The City's proportionate share of the net pension liability was based on the City's contributions received by PERA during the measurement period for employer payroll paid dates from July 1, 2019 through June 30, 2020 relative to the total employer contributions received from all of PERA's participating employers. The City's proportionate share was 0.0174 percent which was an increase of 0.0013 percent decrease from its proportion measured as of June 30, 2019. City's Proportianate Share of the Net Pension Liability $ 1,043,210 State of Minnesota's Proportionate Share of the Net Pension Liability Associated with the City 32,283 Total $ 1,075,493 For the year ended December 31, 2020, the City recognized a pension expense of$68,496 for its proportionate share of the General Employees Fund's pension expense. In addition, the City recognized an additional $2,810 as pension expense (and grant revenue) for its proportionate share of the State of Minnesota's contribution of$16 million to the General Employees Fund. At December 31, 2020, the City reported its proportionate share of General Employees Fund's deferred outflows of resources and deferred inflows of resources, related to pensions from the following sources: Deferred Deferred Outflows Inflows of Resources of Resources Differences Between Expected and Actual Experience $ 9,455 $ 9,902 Changes in Actuarial Assumptions 2,473 39,034 Net Difference Between Projected and Actual Earnings on Plan Investments 33,278 - Changes in Proportion 104,048 6,441 Contributions to PERA Subsequent to the Measurement Date 47,787 - Total $ 197,041 $ 55,377 78 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 4: Defined Benefit Pension Plans - Statewide (Continued) The $47,787 reported as deferred outflows of resources related to pensions resulting from the City's contributions to GERF subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended December 31, 2021. Other amounts reported as deferred outflows and inflows of resources related to GERF pensions will be recognized in pension expense as follows: 2021 $ (17,151) 2022 45,944 2023 39,881 2024 25,203 Police and Fire Fund Pension Costs At December 31, 2020, the City reported a liability of$130,493 for its proportionate share of the Police and Fire Fund's net pension liability. The net pension liability was measured as of June 30, 2020, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The City's proportionate share of the net pension liability was based on the City's contributions received by PERA during the measurement period for employer payroll paid dates from July 1, 2019 through June 30, 2020 relative to the total employer contributions received from all of PERA's participating employers. At June 30, 2020, the City's proportionate share was 0.0174 percent which was an increase of 0.0013 percent from its proportionate share measured as of June 30, 2019. As a result, the State of Minnesota is included as a non-employer contributing entity in the Police and Fire Retirement Plan Schedule of Employer Allocations and Schedule of Pension Amounts by Employer, Current Reporting Period Only (pension allocation schedules) for the $4.5 million in direct state aid. Police and Fire Plan employers need to recognize their proportionate share of the State of Minnesota's pension expense (and grant revenue) under GASB 68 special funding situation accounting and financial reporting requirements. For the year ended December 31, 2020, the City recognized pension expense of$103,951 for its proportionate share of the Police and Fire Plan's pension expense. The State of Minnesota is not included as a non-employer contributing entity in the Police and Fire Pension Plan pension allocation schedules for the $9 million in fire state aid. The City also recognized $26,797 for the year ended December 31, 2020 as revenue and an offsetting reduction of net pension liability for its proportionate share of the State of Minnesota's on-behalf contributions to the Police and Fire Fund. At December 31, 2020, the City reported its proportionate share of the Police and Fire Plan's deferred outflows of resources and deferred inflows of resources from the following sources: Deferred Deferred Outflows Inflows of Resources of Resources Differences Between Expected and Actual Experience $ 5,950 $ 6,264 Changes in Actuarial Assumptions 42,944 77,511 Net Difference Between Projected and Actual Earnings on Plan Investments 5,818 - Changes in Proportion 28,484 1,836 Contributions to PERA Subsequent to the Measurement Date 10,413 - Total $ 93,609 $ 85,611 79 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 4: Defined Benefit Pension Plans - Statewide (Continued) The $10,413 reported as deferred outflows of resources related to pensions resulting from the City's contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended December 31, 2021. Other amounts reported as deferred outflows and inflows of resources related to pensions will be recognized in pension expense as follows: 2021 $ (5,395) 2022 (29,834) 2023 7,906 2024 8,771 2025 16,137 E. Actuarial Assumptions The total pension liability in the June 30, 2020 actuarial valuation was determined using an individual entry-age normal actuarial cost method and the following actuarial assumptions: Inflation 2.50% Active Member Payroll Growth 3.25% per year Investment Rate of Return 7.50% Salary increases were based on a service-related table. Mortality rates for active members, retirees, survivors and disabilitants were based on RP-2014 tables for males or females, as appropriate, with slight adjustments to fit PERA's experience. Cost of living benefit increases after retirement for retirees are assumed to be 1.25 percent per year for General Employees Plan and 1.0 percent per year for Police and Fire Plan. Actuarial assumptions used in the June 30, 2020 valuation were based on the results of actuarial experience studies. The most recent four-year experience study in the General Employee Plan was completed in 2019. The assumption changes were adopted by the Board and become effective with the July 1, 2020 actuarial valuation. The most recent four-year experience study for the Police and Fire Plan was completed in 2020. The recommended assumptions for that plan were adopted by the Board and will be effective with the July 1, 2021 actuarial valuations if approved by the Legislature. 80 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 4: Defined Benefit Pension Plans - Statewide (Continued) The following changes in actuarial assumptions and plan provisions occurred in 2020: General Employees Fund Changes in Actuarial Assumptions • The price inflation assumption was decreased from 2.50% to 2.25%. • The payroll growth assumption was decreased from 3.25% to 3.00%. • Assumed salary increase rates were changed as recommended in the June 30, 2019 experience study. The net effect is assumed rates that average 0.25% less than previous rates. • Assumed rates of retirement were changed as recommended in the June 30, 2019 experience study. The changes result in more unreduced (normal) retirements and slightly fewer Rule of 90 and early retirements. • Assumed rates of termination were changed as recommended in the June 30, 2019 experience study. The new rates are based on service and are generally lower than the previous rates for years 2-5 and slightly higher thereafter. • Assumed rates of disability were changed as recommended in the June 30, 2019 experience study. The change results in fewer predicted disability retirements for males and females. • The base mortality table for healthy annuitants and employees was changed from the RP-2014 table to the Pub- 2010 General Mortality table, with adjustments. The base mortality table for disabled annuitants was changed from the RP-2014 disabled annuitant mortality table to the PUB-2010 General/Teacher disabled annuitant mortality table, with adjustments. • The mortality improvement scale was changed from Scale MP-2018 to Scale MP-2019. • The assumed spouse age difference was changed from two years older for females to one year older. • The assumed number of married male new retirees electing the 100% Joint &Survivor option changed from 35% to 45%. The assumed number of married female new retirees electing the 100% Joint& Survivor option changed from 15% to 30%. The corresponding number of married new retirees electing the Life annuity option was adjusted accordingly. Changes in Plan Provisions Augmentation for current privatized members was reduced to 2.0% for the period July 1, 2020 through December 31, 2023 and 0.0% after. Augmentation was eliminated for privatizations occurring after June 30, 2020. Police and Fire Fund Changes in Actuarial Assumptions • The mortality projection scale was changed from MP-2018 to MP-2019. Changes in Plan Provisions • There have been no changes since the prior valuation. 81 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 4: Defined Benefit Pension Plans - Statewide (Continued) The State Board of Investment, which manages the investments of PERA, prepares an analysis of the reasonableness on a regular basis of the long-term expected rate of return using a building-block method in which best-estimate ranges of expected future rates of return are developed for each major asset class. These ranges are combined to produce an expected long-term rate of return by weighting the expected future rates of return by the target asset allocation percentages. The target allocation and best estimates of geometric real rates of return for each major asset class are summarized in the following table: Long-term Target Expected Real Asset Class Allocation Rate of Return Domestic Stocks 35.50 % 5.10 % Alternative Assets (Private Markets) 25.00 5.90 Bonds (Fixed Income) 20.00 0.75 International Stocks 17.50 5.30 Cash 2.00 - Total 100.00 % F. Discount Rate The discount rate used to measure the total pension liability in 2020 was 7.50 percent. The projection of cash flows used to determine the discount rate assumed that contributions from plan members and employers will be made at rates set in Minnesota Statutes. Based on these assumptions, the fiduciary net position of the General Employees Fund and the Police and Fire Fund were projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. G. Pension Liability Sensitivity The following presents the City's proportionate share of the net pension liability for all plans it participates in, calculated using the discount rate disclosed in the preceding paragraph, as well as what the City's proportionate share of the net pension liability would be if it were calculated using a discount rate one percentage point lower or one percentage point higher than the current discount rate: City's Proportionate Share of NPL 1 Percent 1 Percent Decrease (6.50%) Current (7.50%) Increase (8.50%) General Employees Fund $ 1,671,903 $ 1,043,210 $ 524,588 City's Proportionate Share of NPL 1 Percent 1 Percent Decrease (6.50%) Current (7.50%) Increase (8.50%) Police and Fire Fund $ 260,091 $ 130,493 $ 23,273 H. Pension Plan Fiduciary Net Position Detailed information about each pension plan's fiduciary net position is available in a separately-issued PERA financial report that includes financial statements and required supplementary information. That report may be obtained on the Internet at www.mnpera.org. 82 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 5: Defined Benefit Pension Plans - Fire Relief Association A. Plan Description All members of the Albertville Fire Department (the Department) are covered by a defined benefit plan administered by the Albertville Fireman's Relief Association (the Association). As of December 31, 2020, the plan covered 26 active firefighters and 8 vested terminated fire fighters whose pension benefits are deferred. The plan is a single employer retirement plan and is established and administered in accordance with Minnesota statute, chapter 69. The Association maintains a separate Special fund to accumulate assets to fund the retirement benefits earned by the Department's membership. Funding for the Association is derived from an insurance premium tax in accordance with the Volunteer Firefighter's Relief Association Financing Guidelines Act of 1971 (chapter 261 as amended by chapter 509 of Minnesota statutes 1980). Funds are also derived from investment income. B. Benefits Provided A firefighter who completes at least 20 years as an active member of the Department is entitled, after age 50, to a full service pension upon retirement. The bylaws of the Association also provide for an early vested service pension for a retiring member who has completed fewer than 20 years of service. The reduced pension, available to members with 10 years of service, shall be equal to 60 percent of the pension as prescribed by the bylaws. This percentage increases 4 percent per year so that at 20 years of service, the full amount prescribed is paid. Members who retire with less than 20 years of service and have reached the age of 50 years and have completed at least 10 years of active membership are entitled to a reduced service pension not to exceed the amount calculated by multiplying the member's service pension for the completed years of service times the applicable non-forfeitable percentage of pension. C. Contributions Minnesota statutes, chapters 424 and 424A authorize pension benefits for volunteer fire relief associations. The plan is funded by fire state aid, investment earnings and, if necessary, employer contributions as specified in Minnesota statutes and voluntary City contributions (if applicable). The State of Minnesota contributed in fire state aid to the plan on behalf of the Albertville Fire Department for the year ended December 31, 2019, which was recorded as a revenue. Required employer contributions are calculated annually based on statutory provisions. The City made no voluntary contributions to the plan. The firefighter has no obligation to contribute to the plan. 83 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 5: Defined Benefit Pension Plans - Fire Relief Association (Continued) D. Pension Costs At December 31, 2020, the City reported a net pension liability (asset)of($362,586)for the Volunteer Firefighter Fund. The net pension asset was measured as of December 31, 2020. The total pension asset used to calculate the net pension asset in accordance with GASB 68 was determined by PERA applying an actuarial formula to specific census data certified by the Department. The following table presents the changes in net pension liability (asset) during the year. Total Plan Net Pension Fiduciary Pension Liability Net Position Liability (Asset) (a) (b) (a-b) Beginning Balance January 1, 2019 $ 678,089 $ 877,948 $ (199,859) Changes for the Year Service cost 32,852 - 32,852 Interest cost 34,839 - 34,839 Assumption changes - - - Plan changes - - - Projected investment earnings - 46,140 (46,140) Contributions (State) - 79,430 (79,430) Asset (gain)/loss - 107,361 (107,361) Benefit payouts (155,000) (155,000) - Administrative costs - (2,513) 2,513 Total Net Changes (87,309) 75,418 (162,727) Ending Balance December 31, 2019 $ 590,780 $ 953,366 $ (362,586) For the year ended December 31, 2020, the City recognized a pension expense of$30,253. At December 31, 2020, the City reported deferred inflows of resources and deferred outflows of resources, its contributions subsequent to the measurement date, related to pension from the following sources: Deferred Deferred Outflows Inflows of Resources of Resources Differences Between Expected and Actual Experience $ - $ 28,575 Changes in Actuarial Assumptions - 20,326 Investment Gains - 51,172 Contributions to Plan Subsequent to the Measurement Date 92,750 - Total $ 92,750 $ 100,073 84 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 5: Defined Benefit Pension Plans - Fire Relief Association (Continued) Deferred outflows of resources totaling $92,750 related to pensions resulting from the City's contributions to the plan subsequent to the measurement date will be recognized as a reduction of the net pension asset in the year ended December 31, 2021. Other amounts reported as deferred outflows of resources related to the plan will be recognized in pension expense as follows: 2021 $ (18,919) 2022 (22,080) 2023 (12,332) 2024 (29,345) 2025 (7,876) Thereafter (9,521) E. Actuarial Assumptions The total pension asset at December 31, 2020 was determined using the entry age normal actuarial cost method and the following actuarial assumptions: Retirement Eligibility at 100 Percent of Age 50 Salary Increases 2.50% per year Cost of Living Increases N/A Investment Rate of Return 5.50% 20 Year Municipal Bond Yield 3.50% There were no changes in actuarial assumptions in 2020. The long-term expected rate of return on pension plan investments was determined using a building-block method in which best estimates for expected future real rates of return (expected returns, net of inflation)were developed for each asset class using the plan's target investment allocation along with long-term return expectations by asset class. Inflation expectations were applied to derive the nominal rate of return for the portfolio. The target allocation and best estimates of geometric real rates of return for each major asset class are summarized in the following table: Long-term Target Expected Real Asset Class Allocation Rate of Return Equities 54.00 % 7.30 % Fixed Income 37.00 3.80 Other 1.00 6.00 Cash 8.00 2.25 Total 100.00 % F. Discount Rate The discount rate used to measure the total pension liability was 5.00 percent. The projection of cash flows used to determine the discount rate assumed that contributions to the plan will be made as specified in statute. Based on that assumption and considering the funding ratio of the plan, the fiduciary net position was projected to be available to make all projected future benefit payments of current active and inactive members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. 85 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 5: Defined Benefit Pension Plans - Fire Relief Association (Continued) G. Pension Liability Sensitivity The following presents the City's net pension liability (asset) for the plan, calculated using the discount rate disclosed in the preceding paragraph, as well as what the City's net pension liability (asset)would be if it were calculated using a discount rate 1 percent lower or 1 percent higher than the current discount rate: 1 Percent 1 Percent Decrease (4.50%) Current (5.50%) Increase (6.50%) Defined Benefit Plan $ (342,901) $ (362,586) $ (381,347) H. Pension Plan Fiduciary Net Position The Association issues a publicly available financial report. The report may be obtained by writing to the Albertville Firemen's Relief Association, 5959 Main Avenue NE Albertville, Minnesota, 55301. Note 6: Joint Ventures Joint Powers Water Board of Albertville, Hanover and St. Michael The Joint Powers Water Board of Albertville, Hanover and St. Michael (the "JPWB") was established under a joint powers agreement among the Cities of Albertville, Hanover and St. Michael to provide water service to the local area. The JPWB operates as an enterprise and provides water service to the general public, with the majority of its costs being paid by various fees and charges to users of the water system. The governing body consists of a six-member Board of Commissioners (the "Board"). Two individuals, the Mayor and another City Council Member from each City, are appointed by their respective City Council to serve on the Board. The JPWB does not have any component units. The JPWB' s agreement states that charges billed and collected for water supply remain with the JPWB, while the charges for distribution are billed by the JPWB but the collections are owned by each member City and will be remitted to them upon collection. The financial statements from 2019, the most recent available, is summarized below. Separate financial statements can be obtained by writing to the Joint Powers Water Board, 11100 50th Street NE, Albertville, Minnesota 55301. Joint Powers Water Board Statement of Net Position December 31, 2019 Assets and Deferred Outflow of Resources $ 25,423,094 Liabilities $ 665,956 Net Position 24,757,138 Total Liabilities and Net Position $ 25,423,094 86 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 6: Joint Ventures (Continued) Joint Powers Water Board Summary Statement of Activities For the Year Ended December 31, 2019 Operating Revenues $ 2,053,663 Operating Expenses 1,954,228 Operating Income 99,435 Net Nonoperating Revenues 1,039,316 Change in Net Position 1,138,751 Net Position, January 1 23,618,387 Net Position, December 31 $ 24,757,138 St. Michael -Albertville Ice Arena In 1996-97, the City entered into a Joint Powers Agreement with the City of St. Michael and the Independent School District No. 885. The agreement was for the construction and maintenance of a qualified ice arena. During 2006, the City was notified as being selected as Mighty Ducks Grant recipient to help fund the cost of the ice arena. The arena was constructed with the grant reward and contributions and donations from the City of Albertville, the City of St. Michael and the Independent School District No. 885. In 2019, a new ice sheet was opened by Independent School District No. 885 leading to an amended Joint Powers Agreement with the City of St. Michael and the Independent School District No. 885. The City has an ongoing one-sixth equity financial interest of$211,827 as of December 31, 2020. Separate financial statements can be obtained by contacting Tina Lannes, Finance Director at Albertville City Hall. St. Michael - Albertville Ice Arena Statement of Net Position December 31, 2020 Assets $ 1,541,591 Liabilities $ 20,631 Net Position 1,520,960 Total Liabilities and Net Position $ 1,541,591 87 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 6: Joint Ventures (Continued) St. Michael - Albertville Ice Arena Summary Statement of Activities December 31, 2020 Program Revenues $ 573,650 Expenses (656,339) Interest Revenue 4,415 Change in Net Position (73,859) Net Position, January 1 1,594,819 Net Position, December 31 $ 1,520,960 Note 7: Other Information A. Risk Management The City is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions; injuries to employees; and natural disasters for which the City carries insurance. The City obtains insurance through participation in the League of Minnesota Cities Insurance Trust (LMCIT), which is a risk sharing pool with approximately 800 other governmental units. The City pays an annual premium to LMCIT for its workers compensation and property and casualty insurance. The LMCIT is self-sustaining through member premiums and will reinsure for claims above a prescribed dollar amount for each insurance event. Settled claims have not exceeded the City's coverage in any of the past three fiscal years. Liabilities are reported when it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. An excess coverage insurance policy covers individual claims in excess of$1,000,000. Liabilities, if any, include an amount for claims that have been incurred but not reported (IBNRs). The City's management is not aware of any incurred but not reported claims. B. Legal Debt Margin In accordance with Minnesota statutes, the City may not incur or be subject to net debt in excess of three percent of the market value of taxable property within the City. Net debt is payable solely from ad valorem taxes and, therefore, excludes debt financed partially or entirely by special assessments, enterprise fund revenues or tax increments. The City's applicable debt does not exceed the limit. 88 City of Albertville, Minnesota Notes to the Financial Statements December 31, 2020 Note 7: Other Information (Continued) C. Conduit Debt Obligations Conduit debt obligations are certain limited-obligation revenue bonds or similar debt instruments issued for the express purpose of providing capital financing for a specific third party. The City has issued revenue bonds to provide financial assistance to private-sector entities for projects deemed to be in the public interest. Although these bonds bear the name of the City, the City, the State, nor any political subdivision thereof is obligated in any manner for repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the accompanying financial statements. Authorized Balance at Description and Issued Year End Multifamily Housing Revenue Refunding Bonds, Series 2007 $ 3,540,000 $ 2,875,000 Multifamily Housing Revenue Bonds, Series 2010A 4,750,000 4,105,000 Multifamily Housing Revenue Bonds, Series 2010B 3,300,000 3,193,928 Total Conduit Debt $ 11,590,000 $ 10,173,928 D. Tax Increment Financing 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. Commitment Cost Sharing Agreement The City has entered into a cost sharing agreement for the construction and maintenance of a library with the City of St. Michael, Minnesota. The library net cost is split based on the pro rata average of population and market value. Note 8: COVID-19 On January 30, 2020, the World Health Organization ("WHO") announced a global health emergency because of a new strain of coronavirus ("COVID-19") and the risks to the international community as virus spreads globally. On March 11, 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. In response to the pandemic, the State of Minnesota has issued stay-at-home orders and other measures aimed at slowing the spread of the coronavirus. The full impact of the COVID-19 outbreak continues to evolve as of the date of this report. Due to the rapid development and fluidity of this situation, the City cannot determine the ultimate impact that the COVID-19 pandemic will have on its financial condition, liquidity, and future revenue collection, and therefore any prediction as to the ultimate impact on the City's financial condition, liquidity, and future results of its revenue collections is uncertain. 89 THIS PAGE IS LEFT BLANK INTENTIONALLY 90 REQUIRED SUPPLEMENTARY INFORMATION CITY OF ALBERTVILLE ALBERTVILLE, MINNESOTA FOR THE YEAR ENDED DECEMBER 31 , 2020 91 City of Albertville, Minnesota Required Supplementary Information For the Year Ended December 31, 2020 Schedule of Employer's Share of PERA Net Pension Liability- General Employees Fund City's State's Proportionate Proportionate Share of the City's Share of Net Pension Proportionate the Net Pension Liability as a Plan Fiduciary City's Proportion Share of Liability City's Percentage of Net Position as Fiscal of the the Net PensionAssociated with Covered Covered a Percentage of Year Net Pension Liability the City Total Payroll Payroll the Total Ending Liability (a) (b) (a+b) (c) (a/c) Pension Liability 06/30/20 0.01740 % $ 1,043,210 $ 32,283 $ 1,075,493 $ 1,244,313 83.8 % 79.0 % 06/30/19 0.01610 890,133 27,665 917,798 1,133,606 78.5 80.2 06/30/18 0.01470 815,496 26,781 842,277 986,845 82.6 79.5 06/30/17 0.01510 963,974 12,125 976,099 1,010,559 95.4 75.9 06/30/16 0.01550 1,258,523 16,464 1,274,987 921,545 136.6 68.9 06/30/15 0.01500 777,378 - 777,378 866,860 89.7 78.2 Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. Schedule of Employer's PERA Contributions -General Employees Fund Contributions in Relation to the Statutorily Statutorily Contribution City's Contributions as Required Required Deficiency Covered a Percentage of Year Contribution Contribution (Excess) Payroll Covered Payroll Ending (a) (b) (a-b) (c) (b/c) 12/31/20 $ 95,790 $ 95,790 $ - $ 1,277,201 7.5 % 12/31/19 90,361 90,361 - 1,204,809 7.5 12/31/18 77,347 77,347 - 1,031,293 7.5 12/31/17 72,910 72,910 - 972,129 7.5 12/31/16 72,244 72,244 - 963,255 7.5 12/31/15 66,929 66,929 - 892,386 7.5 Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. 92 City of Albertville, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2020 Notes to the Required Supplementary Information -General Employee Fund Changes in Actuarial Assumptions 2020 -The price inflation assumption was decreased from 2.50% to 2.25%. The payroll growth assumption was decreased from 3.25% to 3.00%. Assumed salary increase rates were changed as recommended in the June 30, 2019 experience study. The net effect is assumed rates that average 0.25% less than previous rates. Assumed rates of retirement were changed as recommended in the June 30, 2019 experience study. The changes result in more unreduced (normal) retirements and slightly fewer Rule of 90 and early retirements. Assumed rates of termination were changed as recommended in the June 30, 2019 experience study. The new rates are based on service and are generally lower than the previous rates for years 2-5 and slightly higher thereafter. Assumed rates of disability were changed as recommended in the June 30, 2019 experience study. The change results in fewer predicted disability retirements for males and females. The base mortality table for healthy annuitants and employees was changed from the RP-2014 table to the Pub-2010 General Mortality table, with adjustments. The base mortality table for disabled annuitants was changed from the RP- 2014 disabled annuitant mortality table to the PUB-2010 General/Teacher disabled annuitant mortality table, with adjustments. The mortality improvement scale was changed from Scale MP-2018 to Scale MP-2019. The assumed spouse age difference was changed from two years older for females to one year older. The assumed number of married male new retirees electing the 100% Joint& Survivor option changed from 35% to 45%. The assumed number of married female new retirees electing the 100% Joint&Survivor option changed from 15% to 30%. The corresponding number of married new retirees electing the Life annuity option was adjusted accordingly. 2019 -The mortality projection scale was changed from MP-2017 to MP-2018. 2018 -The morality projection scale was changed from MP-2015 to MP-2017. The assumed benefit increase was changed from 1.00 percent per year through 2044 and 2.50 percent per year thereafter to 1.25 percent per year. 2017 -The Combined Service Annuity (CSA) loads were changed from 0.8 percent for active members and 60 percent for vested and non-vested deferred members. The revised CSA loads are now 0.0 percent for active member liability, 15.0 percent for vested deferred member liability and 3.0 percent for non-vested deferred member liability. The assumed post-retirement benefit increase rate was changed from 1.0 percent per year for all years to 1.0 percent per year through 2044 and 2.5 percent per year thereafter. 2016 -The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2035 and 2.5 percent per year thereafter to 1.0 percent per year for all future years. The assumed investment return was changed from 7.9 percent to 7.5 percent. The single discount rate was changed from 7.9 percent to 7.5 percent. Other assumptions were changed pursuant to the experience study dated June 30, 2015. The assumed future salary increases, payroll growth and inflation were decreased by 0.25 percent to 3.25 percent for payroll growth and 2.50 percent for inflation. 2015 -The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2030 and 2.5 percent per year thereafter to 1.0 percent per year through 2035 and 2.5 percent per year thereafter. 93 City of Albertville, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2020 Notes to the Required Supplementary Information -General Employee Fund (Continued) Changes in Plan Provisions 2020 -Augmentation for current privatized members was reduced to 2.0% for the period July 1, 2020 through December 31, 2023 and 0.0% after. Augmentation was eliminated for privatizations occurring after June 30, 2020. 2019 -The employer supplemental contribution was changed prospectively, decreasing from $31.0 million to $21.0 million per year. The state's special funding contribution was changed prospectively, requiring $16.0 million due per year through 2031. 2018 -The augmentation adjustment in early retirement factors is eliminated over a five-year period starting July 1, 2019, resulting in actuarial equivalence after June 30, 2024. Interest credited on member contributions decreased from 4.00 percent to 3.00 percent, beginning July 1, 2018. Deferred augmentation was changed to 0.00 percent, effective January 1, 2019. Augmentation that has already accrued for deferred members will still apply. Contribution stabilizer provisions were repealed. Postretirement benefit increases were changed from 1.00 percent per year with a provision to increase to 2.50 percent upon attainment of 90.00 percent funding ratio to 50.00 percent of the Social Security Cost of Living Adjustment, not less than 1.00 percent and not more than 1.50 percent, beginning January 1, 2019. For retirements on or after January 1, 2024, the first benefit increase is delayed until the retiree reaches normal retirement age; does not apply to Rule of 90 retirees, disability benefit recipients, or survivors. Actuarial equivalent factors were updated to reflect revised mortality and interest assumptions. 2017 -The State's contribution for the Minneapolis Employees Retirement Fund equals $16,000,000 in 2017 and 2018, and $6,000,000 thereafter. The Employer Supplemental Contribution for the Minneapolis Employees Retirement Fund changed from $21,000,000 to $31,000,000 in calendar years 2019 to 2031. The state's contribution changed from $16,000,000 to $6,000,000 in calendar years 2019 to 2031. 2016 - No changes noted. 2015 -On January 1, 2015, the Minneapolis Employees Retirement Fund was merged into the General Employees Fund, which increased the total pension liability by $1.1 billion and increased the fiduciary plan net position by$892 million. Upon consolidation, state and employer contributions were revised. 94 City of Albertville, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2020 Schedule of Employer's Share of PERA Net Pension Liability - Police and Fire Fund City's State's Proportionate Proportionate Share of the City's Share of Net Pension Proportionate the Net Pension Liability as a Plan Fiduciary City's Proportion Share of Liability City's Percentage of Net Position Fiscal of the the Net Pension Associated with Covered Covered as a Percentage Year Net Pension Liability the City Total Payroll Payroll of the Total Ending Liability (a) (b) (a+b) (c) (a/c) Pension Liability 06/30/20 0.00990 % $ 130,493 $ 87,099 $ 130,493 $ 116,132 112.4 % 87.2 % 06/30/19 0.00900 95,814 - 95,814 95,184 100.7 89.3 06/30/18 0.00880 93,799 - 121,511 96,188 97.5 88.8 06/30/17 0.00900 121,511 - 121,511 89,111 136.4 85.4 06/30/16 0.00900 361,186 - 361,186 84,960 425.1 63.9 06/30/15 0.00900 102,261 - 102,261 61,377 166.6 86.6 Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. Schedule of Employer's PERA Contributions - Police and Fire Fund Contributions in Relation to the Statutorily Statutorily Contribution City's Contributions as Required Required Deficiency Covered a Percentage of Year Contribution Contribution (Excess) Payroll Covered Payroll Ending (a) (b) (a-b) (c) (b/c) 12/31/20 $ 20,812 $ 20,812 $ - $ 122,785 16.95 % 12/31/19 17,055 17,055 - 105,275 16.20 12/31/18 15,197 15,197 - 93,809 16.20 12/31/17 14,820 14,820 - 91,482 16.20 12/31/16 14,111 14,111 - 87,106 16.20 12/31/15 9,943 9,943 - 61,378 16.20 Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. 95 City of Albertville, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2020 Notes to the Required Supplementary Information - Police and Fire Fund Changes in Actuarial Assumptions 2020 -The mortality projection scale was changed from MP-2018 to MP-2019. 2019 -The mortality projection scale was changed from MP-2017 to MP-2018. 2018 -The morality projection scale was changed from MP-2016 to MP-2017. As set by statute, the assumed post- retirement benefit increase was changed from 1.0 percent per year through 2064 and 2.5 percent per year, thereafter, to 1.0 percent for all years, with no trigger. 2017 -Assumed salary increases were changed as recommended in the June 30, 2016 experience study. The net effect is proposed rates that average 0.34 percent lower than the previous rates. Assumed rates of retirement were changed, resulting in fewer retirements. The Combined Service Annuity (CSA) load was 30 percent for vested and non-vested deferred members. The CSA has been changed to 33 percent for vested members and 2 percent for non-vested members. The base mortality table for healthy annuitants was changed from the RP-2000 fully generational table to the RP-2014 fully generational table (with a base year of 2006), with male rates adjusted by a factor of 0.96. The mortality improvement scale was changed from Scale AA to Scale MP-2016. The base mortality table for disabled annuitants was changed from the RP-2000 disabled mortality table to the mortality tables assumed for healthy retirees. Assumed termination rates were decreased to 3.0 percent for the first three years of service. Rates beyond the select period of three years were adjusted, resulting in more expected terminations overall. Assumed percentage of married female members was decreased from 65 percent to 60 percent. Assumed age difference was changed from separate assumptions for male members (wives assumed to be three years younger) and female members (husbands assumed to be four years older) to the assumption that males are two years older than females. The assumed percentage of female members electing joint and survivor annuities was increased. The assumed post-retirement benefit increase rate was changed from 1.00 percent for all years to 1.00 percent per year through 2064 and 2.50 percent thereafter. The single discount rate was changed from 5.6 percent to 7.5 percent. 2016 -The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2037 and 2.5 percent per year thereafter to 1.0 percent per year for all future years. The assumed investment return was changed from 7.9 percent to 7.5 percent. The single discount rate was changed from 7.9 percent to 5.6 percent. The assumed future salary increases, payroll growth and inflation were decreased by 0.25 percent to 3.25 percent for payroll growth and 2.50 percent for inflation. 2015 -The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2030 and 2.5 percent per year thereafter to 1.0 percent per year through 2037 and 2.5 percent per year thereafter. 96 City of Albertville, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2020 Notes to the Required Supplementary Information - Police and Fire Fund (Continued) Changes in Plan Provisions 2020 - No changes noted. 2019 - No changes noted. 2018 -As set by statute, the assumed post-retirement benefit increase was changed from 1.0 percent per year through 2064 and 2.5 percent per year, thereafter, to 1.0 percent for all years, with no trigger. An end date of July 1, 2048 was added to the existing $9.0 million state contribution. New annual state aid will equal $4.5 million in fiscal years 2019 and 2020, and $9.0 million thereafter until the plan reaches 100 percent funding, or July 1, 2048, if earlier. Member contributions were changed from 10.80 percent to 11.30 percent of pay, effective January 1, 2019 and 11.80 percent of pay, effective January 1, 2020. Employer contributions were changed from 16.20 percent to 16.95 percent of pay, effective January 1, 2019 and 17.70 percent of pay, effective January 1, 2020. Interest credited on member contributions decreased from 4.00 percent to 3.00 percent, beginning July 1, 2018. Deferred augmentation was changed to 0.00 percent, effective January 1, 2019. Augmentation that has already accrued for deferred members will still apply. Actuarial equivalent factors were updated to reflect revised mortality and interest assumptions. 2017 -Assumed salary increases were changed as recommended in the June 30, 2016 experience study. The net effect is proposed rates that average 0.34 percent lower than the previous rates. Assumed rates of retirement were changed, resulting in fewer retirements. The combined service annuity (CSA) load was 30.00 percent for vested and non-vested, deferred members. The CSA has been changed to 33.00 percent for vested members and 2.00 percent for non-vested members. The base mortality table for healthy annuitants was changed from the RP-2000 fully generational table to the RP-2014 fully generational table (with a base year of 2006), with male rates adjusted by a factor of 0.96. The mortality improvement scale was changed from Scale AA to Scale MP-2016. The base mortality table for disabled annuitants was changed from the RP-2000 disabled mortality table to the mortality tables assumed for healthy retirees. Assumed termination rates were decreased to 3.00 percent for the first three years of service. Rates beyond the select period of three years were adjusted, resulting in more expected terminations overall. Assumed percentage of married female members was decreased from 65.00 percent to 60.00 percent. Assumed age difference was changed from separate assumptions for male members (wives assumed to be three years younger) and female members (husbands assumed to be four years older)to the assumption that males are two years older than females. The assumed percentage of female members electing joint and survivor annuities was increased. The assumed postretirement benefit increase rate was changed from 1.00 percent for all years to 1.00 percent per year through 2064 and 2.50 percent thereafter. The single discount rate was changed from 5.60 percent per annum to 7.50 percent per annum. 2016 - No changes noted. 2015 -The post-retirement benefit increase to be paid after attainment of the 90 percent funding threshold was changed, from inflation up to 2.5 percent, to a fixed rate of 2.5 percent. 97 City of Albertville, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2020 Schedule of Changes in the Fire Relief Association's Net Pension Liability (Asset)and Related Ratios 2020 2019 2018 2017 2016 2015 Total Pension Liability Service cost $ 32,852 $ 32,747 $ 29,490 $ 15,570 $ 16,177 $ 14,820 Interest on pension liability(asset) 34,839 31,217 27,065 30,956 32,273 35,420 Changes of benefit terms - 37,505 40,146 104,288 - - Differences between expected and actual experience - - - Gain or loss (5,308) (40,750) Changes of assumptions (9,656) (21,365) Benefit payments (155,000) - (33,851) (41,296) (127,238) - Net Change in Total Pension Liability (87,309) 86,505 62,850 47,403 (78,788) 50,240 Total Pension Liability-January 1 678,089 591,584 528,734 481,331 560,119 509,879 Total Pension Liability-December 31 (a) $ 590,780 $ 678,089 $ 591,584 $ 528,734 $ 481,331 $ 560,119 Plan Fiduciary Net Position Employer contributions $ - $ - $ - $ - $ - $ 11,877 Nonemployer contributions 79,430 67,699 65,732 69,454 65,940 37,411 Projected investment return 46,140 44,300 37,625 45,246 46,826 45,479 Gain(loss) 107,361 (85,101) 48,772 (15,836) (53,155) (16,151) Benefit payments (155,000) - (33,851) (41,296) (127,238) Administrative expenses (2,513) (2,182) (3,204) (2,835) (5,205) Net Change in Plan Fiduciary Net Position 75,418 24,716 115,074 54,733 (67,627) 73,411 Plan Fiduciary Net Position-January 1 877,948 853,232 738,158 683,425 751,052 677,641 Plan Fiduciary Net Position-December 31 (b) $ 953,366 $ 877,948 $ 853,232 $ 738,158 $ 683,425 $ 751,052 Fire Relief's Net Pension Liability(Asset)-December 31 (a-b) $(362,586) $(199,859) _Lj2 $(209,424) $(202,094) $(190,933) Plan Fiduciary Net Position as a Percentage of the Total Pension Liability(b/a) 161.37% 129.47% 144.23% 139.61% 141.99% 134.09% Covered-employee Payroll N/A N/A N/A N/A N/A N/A Fire Relief's Net Pension Liability(Asset)as a Percentage of Covered-employee Payroll N/A N/A N/A N/A N/A N/A Notes to the Schedule: Benefit Changes. In 2015,the benefit terms were modified to base public safety employee pensions on a final three-year average salary instead of a final five-year average salary. Changes of Assumptions. In 2015,amounts reported as changes of assumptions resulted primarily from adjustments to expected retirement ages of general employees. In 2015,amounts reported as changes of assumptions resulted primarily from adjustments to expected retirement ages of public safety employees. In 2015,amounts reported as changes of assumptions resulted primarily from adjustments to assumed life expectancies as a result of adopting the RP-2000 Healthy Annuitant Mortality Table for purposes of developing mortality rates. Note:Schedule is intended to show 10-year trend.Additional years will be reported as they become available. 98 City of Albertville, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2020 Schedule of Employer's Fire Relief Association Contributions Actuarial Actual Contribution Determined Contributions Deficiency Year Contribution Paid (Excess) Ending (a) (b) (a-b) 12/31/20 $ - $ - $ - 12/31/19 184,292 188,037 (3,745) 12/31/18 144,183 183,253 (39,070) 12/31/17 144,183 181,662 (37,479) 12/31/16 165,022 203,653 (38,631) 12/31/15 44,859 44,859 - 12/31/14 49,288 49,288 - * Information not available at time of audit. Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. 99 THIS PAGE IS LEFT BLANK INTENTIONALLY 100 COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND SCHEDULES CITY OF ALBERTVILLE ALBERTVILLE, MINNESOTA FOR THE YEAR ENDED DECEMBER 31 , 2020 101 THIS PAGE IS LEFT BLANK INTENTIONALLY 102 NONMAJOR GOVERNMENTAL FUNDS CITY OF ALBERTVILLE ALBERTVILLE, MINNESOTA FOR THE YEAR ENDED DECEMBER 31 , 2020 103 City of Albertville, Minnesota Nonmajor Governmental Funds Combining Balance Sheet December 31, 2020 Special Revenue 104 Economic Total Development Capital Nonmajor Loan Fund Projects Funds Assets Cash and temporary investments $ 156,143 $ 144,590 $ 300,733 Liabilities Advances from other funds $ - $ 393,595 $ 393,595 Fund Balances Restricted - 140,801 140,801 Committed 156,143 - 156,143 Unassigned - (389,806) (389,806) Total Fund Balances 156,143 (249,005) (92,862) Total Liabilities and Fund Balances $ 156,143 $ 144,590 $ 300,733 104 City of Albertville, Minnesota Nonmajor Governmental Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended December 31, 2020 Special Revenue 104 Economic Total Development Capital Nonmajor Loan Fund Projects Funds Revenues Tax increments $ - $ 240,457 $ 240,457 Charges for service - 13,284 13,284 Interest on investments 3,307 1,587 4,894 Total Revenues 3,307 255,328 258,635 Expenditures Current Economic development - 170,476 170,476 Capital outlay Culture and recreation - 22,452 22,452 Debt Service Interest - 16,511 16,511 Total Expenditures - 209,439 209,439 Net Change in Fund Balances 3,307 45,889 49,196 Fund Balances, January 1 152,836 (294,894) (142,058) Fund Balances, December 31 $ 156,143 $ (249,005) $ (92,862) 105 THIS PAGE IS LEFT BLANK INTENTIONALLY 106 NONMAJOR CAPITAL PROJECTS FUNDS Capital projects funds are used to account for the acquisition and construction of major capital facilities other than those financed by enterprise funds. Park - This fund accounts for the accumulation of resources and payments made for the construction of park improvements. Park dedication fees, contributions and donations as well as interest are the main financing sources. TIF#7 Senior Housing -This fund was created to facilitate the construction of the Senior Housing project within the City. This fund accounts for the financial activity related to that project. TIF#14 Fraser Steel -This fund was created to facilitate the Fraser Steel project within the City. This fund accounts for the financial activity related to that project. TIF#15 Guardian Angels -This fund was created to facilitate the Fraser Steel project within the City. This fund accounts for the financial activity related to that project. TIF#16 Mold Tech - This fund was created to facilitate the Mold Tech project within the City. This fund accounts for the financial activity related to that project. TIF#17 Old Castle fund - This fund accounts for the accumulation of resources and payments made for the Old Castle project. 107 City of Albertville, Minnesota Nonmajor Capital Projects Funds Combining Balance Sheet December 31, 2020 201 407 414 TIF#7 TIF#14 Park Senior Fraser Fund Housing Steel Assets Cash and temporary investments $ 229 $ 53,747 32,687 Liabilities Advances from other funds $ - $ - $ - Fund Balances Restricted 229 53,747 32,687 Unassigned - - - Total Fund Balances 229 53,747 32,687 Total Liabilities and Fund Balances $ 229 $ 53,747 $ 32,687 108 415 416 417 TIF#15 TIF#16 TIF#17 Guardian Mold Old Angels Tech Castle Total $ 54,138 $ 2,736 $ 1,053 $ 144,590 $ - $ 5,821 387,774 $ 393,595 54,138 - - 140,801 - (3,085) (386,721) (389,806) 54,138 (3,085) (386,721) (249,005) $ 54,138 $ 2,736 $ 1,053 $ 144,590 109 City of Albertville, Minnesota Nonmajor Capital Projects Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended December 31, 2020 201 407 414 TIF#7 TIF#14 Park Senior Fraser Fund Housing Steel Revenues Tax increments $ - $ 35,419 52,509 Charges for services 13,284 - - Interest on investments 299 764 134 Total Revenues 13,583 36,183 52,643 Expenditures Current Economic development - 30,605 46,694 Capital outlay Culture and recreation 22,452 - - Debt Service Interest - - - Total Expenditures 22,452 30,605 46,694 Net Change in Fund Balances (8,869) 5,578 5,949 Fund Balances, January 1 9,098 48,169 26,738 Fund Balances, December 31 $ 229 $ 53,747 $ 32,687 110 415 416 417 TIF#15 TIF#16 TIF#17 Guardian Mold Old Angels Tech Castle Total $ 84,288 $ 18,215 $ 50,026 $ 240,457 - - - 13,284 246 3 141 1,587 84,534 18,218 50,167 255,328 76,583 16,148 446 170,476 - - - 22,452 - - 16,511 16,511 76,583 16,148 16,957 209,439 7,951 2,070 33,210 45,889 46,187 (5,155) (419,931) (294,894) $ 54,138 $ (3,085) $ (386,721) $ (249,005) 111 City of Albertville, Minnesota General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances- Budget to Actual (Continued on the Following Pages) For the Year Ended December 31, 2020 (With Comparative Actual Amounts for the Year Ended December 31, 2019) 2020 2019 Budgeted Amounts Actual Variance with Actual Original Final Amounts Final Budget Amounts Revenues Taxes General property taxes $ 2,138,228 $ 2,138,228 $ 2,145,139 $ 6,911 $ 2,071,798 Licenses and permits Business 57,000 57,000 66,686 9,686 72,209 Non-business 101,500 101,500 234,202 132,702 142,899 Total licenses and permits 158,500 158,500 300,888 142,388 215,108 Intergovernmental Federal CARES Act - - 563,922 563,922 - State Local government aid 112,010 112,010 112,010 - 112,110 Property tax credits - - 169 169 167 Other 116,500 116,500 164,094 47,594 148,615 Total intergovernmental 228,510 228,510 840,195 611,685 260,892 Charges for services General government 303,010 303,010 357,063 54,053 351,708 Public safety 407,253 407,253 407,253 - 334,684 Culture and recreation 15,000 15,000 298,774 283,774 317,844 Total charges for services 725,263 725,263 1,063,090 337,827 1,004,236 Fines and forfeitures - - - - 500 Special assessments - - 28,905 28,905 18,280 Interest on investments 25,000 25,000 37,030 12,030 94,590 Miscellaneous Other 15,000 15,000 15,183 183 13,085 Refunds and reimbursements - - 76,781 76,781 9,309 Total miscellaneous 15,000 15,000 91,964 76,964 22,394 Total Revenues 3,290,501 3,290,501 4,507,211 1,216,710 3,687,798 112 City of Albertville, Minnesota General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances- Budget and Actual (Continued) For the Year Ended December 31, 2020 (With Comparative Actual Amounts for the Year Ended December 31, 2019) 2020 2019 Budgeted Amounts Actual Variance with Actual Original Final Amounts Final Budget Amounts Expenditures Current General government Legislative Personal services $ 20,669 $ 20,669 $ 20,023 $ 646 $ 20,733 Supplies 2,500 2,500 90 2,410 1,835 Other services and charges 24,105 24,105 23,460 645 24,367 Total legislative 47,274 47,274 43,573 3,701 46,935 Administration Personal services 139,901 139,901 136,480 3,421 120,556 Supplies 5,000 5,000 2,213 2,787 3,150 Other services and charges 13,500 13,500 6,603 6,897 11,548 Total administration 158,401 158,401 145,296 13,105 135,254 City clerk Personal services 71,949 71,949 69,102 2,847 68,588 Supplies 9,500 9,500 7,527 1,973 9,093 Other services and charges 39,053 39,053 55,488 (16,435) 39,052 Total city clerk 120,502 120,502 132,117 (11,615) 116,733 Elections and voter registration Personal services - - 1,396 (1,396) - Supplies - - 37 (37) - Other services and charges 25,000 25,000 32,802 (7,802) 1,030 Total elections and voter registration 25,000 25,000 34,235 (9,235) 1,030 Treasurer Personal services 83,573 83,573 78,175 5,398 84,317 Supplies 7,200 7,200 871 6,329 2,927 Other services and charges 21,700 21,700 13,629 8,071 14,389 Total treasurer 112,473 112,473 92,675 19,798 101,633 Assessing Other services and charges 36,720 36,720 38,913 (2,193) 35,538 Legal Other services and charges 40,000 40,000 39,602 398 30,316 113 City of Albertville, Minnesota General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances- Budget and Actual (Continued) For the Year Ended December 31, 2020 (With Comparative Actual Amounts for the Year Ended December 31, 2019) 2020 2019 Budgeted Amounts Actual Variance with Actual Original Final Amounts Final Budget Amounts Expenditures(Continued) Current(continued) General government(continued) Engineering Other services and charges $ 25,000 $ 25,000 $ 56,923 $ (31,923) $ 22,641 Miscellaneous Personal services 23,974 23,974 25,140 (1,166) 22,096 Supplies 1,500 1,500 1,426 74 1,345 Other services and charges 213,137 213,137 266,431 (53,294) 239,882 Total miscellaneous 238,611 238,611 292,997 (54,386) 263,323 Total general government 803,981 803,981 876,331 (72,350) 753,403 Public safety Police protection Other services and charges 799,715 799,715 801,906 (2,191) 761,390 Fire protection Personal services 396,168 396,168 442,356 (46,188) 423,893 Supplies 19,253 19,253 19,342 (89) 28,401 Other services and charges 109,600 109,600 110,989 (1,389) 117,078 Total fire protection 525,021 525,021 572,687 (47,666) 569,372 Protective inspection Personal services 112,334 112,334 108,199 4,135 87,714 Supplies 1,350 1,350 435 915 1,797 Other services and charges 134,970 134,970 138,238 (3,268) 128,726 Total protective inspection 248,654 248,654 246,872 1,782 218,237 Animal control Other services and charges 9,000 9,000 7,882 1,118 8,192 Total public safety 1,582,390 1,582,390 1,629,347 (46,957) 1,557,191 114 City of Albertville, Minnesota General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances- Budget and Actual (Continued) For the Year Ended December 31, 2020 (With Comparative Actual Amounts for the Year Ended December 31, 2019) 2020 2019 Budgeted Amounts Actual Variance with Actual Original Final Amounts Final Budget Amounts Expenditures(Continued) Current(continued) Public works Streets Personal services $ 258,250 $ 258,250 $ 246,568 $ 11,682 $ 206,130 Supplies 43,300 43,300 25,906 17,394 51,590 Other services and charges 61,100 61,100 61,722 (622) 46,749 Total streets 362,650 362,650 334,196 28,454 304,469 Street lighting Other services and charges 91,166 91,166 85,694 5,472 86,010 Total public works 453,816 453,816 419,890 33,926 390,479 Culture and recreation Parks Personal services 299,830 299,830 289,577 10,253 260,838 Supplies 22,206 22,206 23,102 (896) 63,856 Other services and charges 129,741 129,741 155,599 (25,858) 121,786 Total parks 451,777 451,777 468,278 (16,501) 446,480 Arena Personal services - - 294,743 (294,743) 301,636 Total culture and recreation 451,777 451,777 763,021 (311,244) 748,116 Economic development Other services and charges 11,000 11,000 39,694 (28,694) 6,994 Total current 3,302,964 3,302,964 3,728,283 (425,319) 3,456,183 Capital outlay General government - - 18,958 (18,958) - Public safety - - 87,283 (87,283) - Total capital outlay - - 106,241 (106,241) - Total Expenditures 3,302,964 3,302,964 3,834,524 (531,560) 3,456,183 Net Change in Fund Balances (12,463) (12,463) 672,687 685,150 231,615 Fund Balances, January 1 2,617,925 2,617,925 2,617,925 - 2,386,310 Fund Balances, December 31 $ 2,605,462 $ 2,605,462 $ 3,290,612 $ 685,150 $ 2,617,925 115 City of Albertville, Minnesota Debt Service Fund Combining Balance Sheet December 31, 2020 357 358 359 360 CSAH 19 2003A 2011C 2012B 2012A G.O. G.O. CIP G.O. CIP G.O. Improv. Improvement Refunding Refunding Refunding Assets Cash and temporary investments $ (33,121) $ 400,022 $ 16,864 $ 474,527 Receivables Special assessments 227,032 - - 48,614 Interest - - - - Notes - - - - Advances to other funds - - - - Land held for resale 800,434 - - - Total Assets $ 994,345 $ 400,022 $ 16,864 $ 523,141 Deferred Inflows of Resources Unavailable revenue -special assessments $ 227,032 $ - $ - $ 48,514 Unavailable revenue - notes/intergovernmental - - - - Total Deferred Inflows of Resources 227,032 - - 48,514 Fund Balances Restricted Debt service 767,313 400,022 16,864 474,627 Total Deferred Inflows of Resources and Fund Balances $ 994,345 $ 400,022 $ 16,864 $ 523,141 116 361 362 468 Lachman Industrial 2012A 2012A G.O. Improv. G.O. Improv. Refunding Refunding Interstate 94 Total $ 176,567 $ 250,991 $ 342,473 $ 1,628,323 71,996 106,761 429,162 883,565 - - 4,682 4,682 - - 877,780 877,780 - 393,595 - 393,595 - 420,519 - 1,220,953 $ 248,563 $ 1,171,866 $ 1,654,097 $ 5,008,898 $ 71,996 $ 106,761 $ 429,136 $ 883,439 - - 877,780 877,780 71,996 106,761 1,306,916 1,761,219 176,567 1,065,105 347,181 3,247,679 $ 248,563 $ 1,171,866 $ 1,654,097 $ 5,008,898 117 City of Albertville, Minnesota Debt Service Fund Combining Schedule of Revenues, Expenditures And Changes in Fund Balances For the Year Ended December 31, 2020 357 358 359 360 CSAH 19 2003A 2011C 2012B 2012A G.O. G.O. CIP G.O. CIP G.O. Improv. Improvement Refunding Refunding Refunding Revenues Property taxes $ - $ 99,147 $ 265,403 $ 26,157 Special assessments - - - 57,061 Interest earnings - 6,881 760 12,199 Miscellaneous - - - - Total Revenues - 106,028 266,163 95,417 Expenditures Current Public works - - - - Debt service Principal - 135,000 235,000 155,000 Interest and other - 24,404 30,145 11,250 Total Expenditures - 159,404 265,145 166,250 Net Change in Fund Balance - (53,376) 1,018 (70,833) Fund Balances, January 1 767,313 453,398 15,846 545,460 Fund Balances, December 31 $ 767,313 $ 400,022 $ 16,864 $ 474,627 118 361 362 Lachman Industrial 468 2012A 2012A G.O. Improv. G.O. Improv. Refunding Refunding Interstate 94 Total $ 31,600 $ 84,561 $ 53,000 $ 559,868 86,707 63,149 62,379 269,296 3,502 16,511 7,082 46,935 - - 84,930 84,930 121,809 164,221 207,391 961,029 - 7,792 - 7,792 50,000 110,000 171,000 856,000 3,600 6,495 30,763 106,657 53,600 124,287 201,763 970,449 68,209 39,934 5,628 (9,420) 108,358 1,025,171 341,553 3,257,099 $ 176,567 $ 1,065,105 $ 347,181 $ 3,247,679 119 City of Albertville, Minnesota Combining Statement of Fiduciary Net Position Fiduciary Funds December 31, 2020 Albertville Total Friendly Albertville STMA Custodial City Days Lions Ice Arena Funds Assets Cash and temporary investments $ 9,654 $ 171,551 $ 102,873 $ 284,078 Accounts receivable - - 140,249 140,249 Inventory - - 2,178 2,178 Total Assets 9,654 171,551 245,300 426,505 Liabilities Accounts payable - - 14,650 14,650 Accrued wages - - 5,981 5,981 Total Liabilities - - 20,631 20,631 Net Position Restricted for organizations and other governments $ 9,654 $ 171,551 $ 224,669 $ 405,874 120 City of Albertville, Minnesota Combining Statement of Changes in Fiduciary Net Position Fiduciary Funds For the Year Ended December 31, 2020 Albertville Total Friendly Albertville STMA Custodial City Days Lions Ice Arena Funds Additions Contributions Charges for services $ - $ - $ 501,307 $ 501,307 Donations - 45,000 - 45,000 Concessions - - 40,914 40,914 Total Contributions - 45,000 542,221 587,221 Investment earnings Interest, dividends and other 205 3,918 4,416 8,539 Miscellaneous - - 35,844 35,844 Total Additions 205 48,918 582,481 631,604 Deductions Professional services 39 56,313 304,851 361,203 Supplies - - 14,550 14,550 Utilties - - 164,662 164,662 Insurance - - 13,200 13,200 Repairs and Maintenance - - 47,142 47,142 Capital Outlay - - 14,712 14,712 Miscellaneous - - 21,222 21,222 Total Deductions 39 56,313 580,339 636,691 Net Increase (Decrease) in Fiduciary Net Position 166 (7,395) 2,142 (5,087) Net Position, January 1 9,488 178,946 222,527 410,961 Net Position, December 31 $ 9,654 $ 171,551 $ 224,669 $ 405,874 121 City of Albertville, Minnesota Summary Financial Report Revenues and Expenditures For General Operations Governmental Funds For the Year Ended December 31, 2020 Percent Total Increase 2020 2019 (Decrease) Revenues Taxes $ 4,221,332 $ 4,233,810 (0.29) % Special assessments 352,949 259,787 35.86 Licenses and permits 300,888 215,108 39.88 Intergovernmental 2,077,442 438,035 374.26 Charges for services 1,076,374 1,004,236 7.18 Fines and forfeitures - 500 (100.00) Interest on investments 190,441 384,339 (50.45) Miscellaneous 181,825 138,771 31.03 Total Revenues $ 8,401,251 $ 6,674,586 25.87 % Per Capita $ 1,117 $ 892 25.30 % Expenditures Current General government $ 920,918 $ 791,250 16.39 % Public safety 1,629,347 1,557,191 4.63 Public works 427,682 437,365 (2.21) Culture and recreation 763,021 748,116 1.99 Economic development 210,170 178,507 17.74 Capital outlay General government 20,405 165,954 (87.70) Public safety 182,083 1,685,562 (89.20) Public works 3,301,579 1,274,646 159.02 Culture and recreation 115,065 209,207 (45.00) Economic development 27,732 45,156 (38.59) Debt service Principal 856,000 939,000 (8.84) Interest and other 123,168 165,017 (25.36) Total Expenditures $ 8,577,170 $ 8,196,971 4.64 % Per Capita $ 1,141 $ 1,095 4.17 % Total Long-term Indebtedness $ 5,104,343 $ 5,967,076 (14.46) % Per Capita 679 797 (14.85) General Fund Balance - December 31 $ 3,290,612 $ 2,617,925 25.70 % Per Capita 438 350 25.13 The purpose of this report is to provide a summary of financial information concerning the City of Albertville to interested citizens. The complete financial statements may be examined at City Hall, 5959 Main Avenue, Albertville, MN 55301. Questions about this report should be directed to Tina Lannes, Finance Director at (763)497-3384. 122 STATISTICAL SECTION (UNAUDITED) CITY OF ALBERTVILLE ALBERTVILLE, MINNESOTA FOR THE YEAR ENDED DECEMBER 31 , 2020 123 THIS PAGE IS LEFT BLANK INTENTIONALLY 124 STATISTICAL SECTION (Unaudited) This part of the City of Albertville's comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the government's overall financial health. Financial Trends These schedules contain trend information to help the reader understand how the government's financial performance and well-being have changed over time. Revenue Capacity These schedules contain information to help the reader assess the government's most significant local revenue source, the property tax. Debt Capacity These schedules present information to help the reader assess the affordability of the government's current levels of out-standing debt and the government's ability to issue additional debt in the future. Demographic and Economic Information These schedules offer demographic and economic indicators to help the reader understand the environment within which the government's financial activities take place. Operating Information These schedules contain service and infrastructure data to help the reader understand how the information in the government's financial report relates to the services the government provides and the activities it performs. Sources: Unless otherwise noted, the information in these schedules is derived from the annual financial reports for the relevant year. 125 City of Albertville, Minnesota Statistical Section (Unaudited) Net Position by Component Last Ten Fiscal Years (Accrual Basis of Accounting) Fiscal Year 2011 2012 2013 2014 Governmental Activities Net investment in capital assets $ 17,580,883 $ 16,766,234 $ 16,761,614 $ 15,982,545 Restricted 7,729,485 7,720,152 4,083,926 4,359,358 Unrestricted 3,372,629 4,082,002 3,545,424 4,482,132 Total Governmental Activities Net Position $ 29,680,797 $ 28,920,974 $ 28,682,997 $ 28,568,388 Business-type Activities Net investment in capital assets $ 6,918,585 $ 6,951,242 $ 7,345,829 $ 8,198,571 Unrestricted 11,152,126 11,091,877 10,722,778 9,559,515 Total Business-type Activities Net Position $ 18,176,955 $ 18,070,711 $ 18,043,119 $ 18,068,607 Total Primary Government Net investment in capital assets $ 24,499,468 $ 23,717,476 $ 24,107,443 $ 24,181,116 Restricted 7,729,485 7,720,152 4,083,926 4,359,358 Unrestricted 14,524,755 15,173,879 14,268,202 14,041,647 Total Primary Government $ 47,097,929 $ 46,753,708 $ 46,611,507 $ 42,459,571 Note: The City implemented GASB Statement No. 68 and GASB Statement No. 71 in 2015. Years prior to 2015 have not been restated. 126 Table 1 Fiscal Year 2015 2016 2017 2018 2019 2020 $ 16,000,840 $ 15,925,140 $ 16,653,225 $ 16,996,701 $ 17,512,792 $ 18,587,524 6,603,871 3,240,957 3,543,926 3,482,527 5,398,928 5,120,588 4,287,635 8,260,766 8,191,522 8,651,739 7,289,708 7,153,029 $ 24,390,964 $ 24,824,035 $ 28,388,673 $ 29,130,967 $ 30,201,428 $ 30,861,141 $ 8,423,132 $ 8,632,306 $ 8,717,564 $ 9,046,737 $ 10,922,191 $ 10,788,055 9,038,370 8,856,604 9,562,439 9,489,105 9,102,051 10,545,577 $ 17,758,086 $ 17,461,502 $ 17,488,910 $ 18,280,003 $ 20,024,242 $ 21,333,632 $ 24,423,972 $ 24,557,446 $ 25,370,789 $ 26,043,438 $ 28,434,983 $ 29,375,579 6,603,871 3,240,957 3,543,926 3,482,527 5,398,928 5,120,588 13,326,005 17,117,370 17,753,961 18,140,844 16,391,759 17,698,606 $ 42,582,121 $ 44,353,848 $ 44,915,773 $ 46,668,676 $ 50,225,670 $ 52,194,773 127 City of Albertville, Minnesota Statistical Section (Unaudited) Changes in Net Position (Continued on the Following Pages) Last Ten Fiscal Years (Accrual Basis of Accounting) Fiscal Year 2011 2012 2013 2014 Expenses Governmental Activities General government $ 911,754 $ 1,108,505 $ 948,742 $ 923,711 Public safety 1,077,429 1,129,863 1,075,760 1,103,431 Public works 1,449,728 1,434,202 2,090,108 1,461,319 Culture and recreation 382,071 478,016 505,161 558,881 Economic development 829,782 7,878,251 548,783 137,930 Interest on long-term debt 378,185 354,898 331,119 295,924 Total Governmental Activities Expenses 5,028,949 12,383,735 5,499,673 4,481,196 Business-type Activities Sewer utility 801,198 824,526 1,024,449 946,586 Water utility 919,982 1,170,371 1,095,906 1,108,449 Storm Water utility 102,233 151,009 172,946 170,061 Recycling 65,083 78,830 79,948 81,024 Total Business-type Activities Expenses 1,888,496 2,224,736 2,373,249 2,306,120 Total Expenses $ 6,917,445 $ 14,608,471 $ 7,872,922 $ 6,787,316 Program Revenues Governmental Activities Charges for services General government $ 462,145 $ 498,706 $ 624,869 $ 574,438 Public safety 113,013 117,011 157,752 161,373 Public works 5,249 700 3,250 1,200 Culture and recreation 4,922 166,826 178,550 234,694 Operating grants and contributions 228,540 8,309,198 165,255 249,041 Capital grants and contributions 174,001 102,796 127,438 340,632 Total Governmental Activities Program Revenues 987,870 9,195,237 1,257,114 1,561,378 Business-type Activities Charges for services Sewer utility 690,745 716,448 730,933 728,308 Water utility 837,901 1,066,130 975,753 917,507 Storm Water utility 210,005 220,943 226,677 228,659 Recycling 67,704 78,144 80,115 80,659 Operating grants and contributions 2,828 10,926 19,352 18,657 Capital grants and contributions 115,489 116,394 368,310 154,336 Total Business-Type Activities Program Revenues 1,924,672 2,208,985 2,401,140 2,128,126 Total Program Revenues $ 2,912,542 $ 11,404,222 $ 3,658,254 $ 3,689,504 Note:The City implemented GASB Statement No.68 and GASB Statement No. 71 in 2015. Years prior to 2015 have not been restated. 128 Table 2 Fiscal Year 2015 2016 2017 2018 2019 2020 $ 715,779 $ 858,450 $ 822,891 $ 737,375 $ 767,343 $ 1,058,803 1,222,679 1,602,075 1,548,674 1,529,785 1,877,457 1,941,340 1,636,968 1,631,343 1,385,420 1,757,764 1,195,560 3,185,369 569,429 617,041 788,338 611,258 1,069,989 882,232 229,167 117,086 182,059 221,319 223,663 237,902 255,379 197,099 228,006 167,872 191,958 149,493 41629,401 5,023,094 4,955,388 5,025,373 5,325,970 7,455,139 961,507 846,349 805,318 818,418 1,102,919 1,111,727 399,813 418,260 369,100 411,151 451,246 417,826 182,779 187,029 265,436 272,024 252,627 290,418 81,689 94,580 95,850 106,514 118,359 117,364 1,625,788 1,546,218 1,535,704 1,608,107 1,925,151 1,937,335 $ 6,255,189 $ 6,569,312 $ 6,491,092 $ 6,633,480 $ 7,251,121 $ 9,392,474 $ 489,742 $ 437,398 $ 630,143 $ 608,525 $ 544,149 $ 640,044 227,250 258,553 276,445 296,707 335,444 458,866 2,500 1,700 5,300 3,050 1,750 4,350 154,851 195,815 229,772 165,908 87,525 301,435 230,499 240,569 265,983 193,526 191,470 852,421 21000,970 99,914 118,011 150,340 359,247 1,324,103 3,105,812 1,233,949 1,525,654 1,418,056 1,519,585 3,581,219 752,094 786,153 848,544 868,052 866,602 1,072,549 256,040 272,503 355,075 362,737 348,310 411,854 251,960 222,630 213,666 211,420 209,206 222,281 81,223 87,444 82,867 94,134 105,028 95,461 64,001 15,954 18,240 16,794 22,416 22,273 122,884 114,742 683,125 201,561 1,515,818 1,203,165 1,528,202 1,499,426 2,201,517 1,754,698 3,067,380 3,027,583 $ 4,634,014 $ 2,733,375 $ 3,727,171 $ 3,172,754 $ 4,586,965 $ 6,608,802 129 City of Albertville, Minnesota Statistical Section (Unaudited) Changes in Net Position (Continued) Last Ten Fiscal Years (Accrual Basis of Accounting) Fiscal Year 2011 2012 2013 2014 Net Revenues(Expenses) Governmental activities $ (4,041,079) $ (3,188,498) $ (4,242,559) $ (2,919,818) Business-type activities 36,176 (15,751) 27,891 (177,994) Total Primary Government Revenues(Expenses) $ (4,004,903) $ (3,204,249) $ (4,214,668) $ (3,097,812) General Revenues and Other Changes in Net Position General Revenues Governmental Activities Taxes Property taxes, levied for general purpose $ 2,252,713 $ 2,448,719 $ 2,491,895 $ 2,478,224 Property taxes, levied for debt service 702,317 715,157 657,878 805,791 Tax increments 26,716 26,716 26,715 28,648 Grants and contributions not restricted to specific programs 20,289 10,280 13,681 90,269 Unrestricted investment earnings 144,581 99,042 (48,206) 182,322 Loss on sale of capital assets - - - - Gain on sale of capital assets 3,381 - - - Miscellaneous - - - - Transfers 299,157 - (50,000) 330,236 Special item-decrease in land held for resale - - (3,026,828) - Total Governmental Activities General Revenues 3,449,154 3,299,914 65,135 3,915,490 Business-type Activities Unrestricted investment earnings 156,737 99,440 (52,403) 197,709 Transfers (299,157) - 50,000 (330,236) Total Business-type Activities General Revenues (142,420) 99,440 (2,403) (132,527) Total Primary Government $ 3,306,734 $ 3,399,354 $ 62,732 $ 3,782,963 Change in Net Position Governmental activities $ (591,925) $ 111,416 $ (4,177,424) $ 995,672 Business-type activities (106,244) 83,689 25,488 (310,521) Total Primary Government $ (698,169) $ 195,105 $ (4,151,936) $ 685,151 Note:The City implemented GASB Statement No.68 and GASB Statement No. 71 in 2015. Years prior to 2015 have not been restated. 130 Table 2 Fiscal Year 2015 2016 2017 2018 2019 2020 $ (1,523,589) $ (3,789,145) $ (3,429,734) $ (3,607,317) $ (3,806,385) $ (3,873,920) (97,586) (46,792) 665,813 146,591 1,142,229 1,090,248 $ (1,621,175) $ (3,835,937) $ (2,763,921) $ (3,460,726) $ (2,664,156) $ (2,783,672) $ 2,606,772 $ 2,746,144 $ 2,839,090 $ 3,054,845 $ 3,497,033 $ 3,469,449 885,270 921,796 916,050 831,410 508,855 506,868 109,132 169,651 230,131 231,247 232,684 240,457 98,932 102,311 93,140 111,979 113,056 126,418 86,644 103,541 138,248 120,130 384,339 190,441 3,450 - 49,020 - 140,879 - 132,569 280,219 172,681 - - - - - (46,816) - - - 3,922,769 4,323,662 4,391,544 4,349,611 4,876,846 4,533,633 89,694 74,200 78,464 109,248 346,171 219,142 - - 46,816 - - - 89,694 74,200 125,280 109,248 346,171 219,142 $ 4,012,463 $ 4,397,862 $ 4,516,824 $ 4,458,859 $ 5,223,017 $ 4,752,775 $ 2,399,180 $ 534,517 $ 961,810 $ 742,294 $ 1,070,461 $ 659,713 (7,892) 27,408 791,093 255,839 1,488,400 1,309,390 $ 2,391,288 $ 561,925 $ 1,752,903 $ 998,133 $ 2,558,861 $ 1,969,103 131 City of Albertville, Minnesota Statistical Section (Unaudited) Fund Balances of Governmental Funds Last Ten Fiscal Years Fiscal Year 2011 2012 2013 2014 General Fund Nonspendable $ 69,759 $ 69,759 $ 51,000 $ 51,000 Unassigned 1,120,455 1,248,815 1,450,586 1,798,358 Total General Fund $ 1,190,214 $ 1,318,574 $ 1,501,586 $ 1,849,358 All Other Governmental Funds Nonspendable $ - $ - $ 10 $ 13,184 Restricted 5,821,587 7,827,860 4,353,603 5,276,492 Committed - - - - Assigned 8,811,663 9,422,484 9,456,557 9,920,395 Unassigned (1,738,994) (746,029) (767,766) (971,681) Total All Other Governmental Funds $ 12,894,256 $ 16,504,315 $ 13,042,404 $ 14,238,390 132 Table 3 Fiscal Year 2015 2016 2017 2018 2019 2020 $ 51,000 $ 51,000 $ 51,000 $ 133,328 $ 140,151 $ 90,389 1,876,186 1,887,922 2,258,988 2,252,982 2,477,774 3,200,223 $ 1,927,186 $ 1,938,922 $ 2,309,988 $ 2,386,310 $ 2,617,925 $ 3,290,612 $ 2,695 $ 1,614 $ - $ - $ - $ - 3,263,871 3,272,492 3,670,865 3,758,526 3,387,291 3,388,480 - - - - 152,836 156,143 5,969,374 6,412,396 6,076,678 6,390,844 4,853,536 3,965,154 (842,241) (469,839) (514,315) (432,912) (425,086) (389,806) $ 8,393,699 $ 9,216,663 $ 9,233,228 $ 9,716,458 $ 7,968,577 $ 7,119,971 133 City of Albertville, Minnesota Statistical Section (Unaudited) Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years Fiscal Year 2011 2012 2013 2014 Revenues Taxes $ 3,058,608 $ 3,182,549 $ 3,212,853 $ 3,302,350 Licenses and permits 125,273 129,088 213,277 167,584 Intergovernmental 258,262 5,881,766 158,861 209,667 Charges for services 558,899 707,161 1,097,560 857,837 Fines and forfeitures - 200 - - Special assessments 342,603 274,016 306,453 384,727 Interest on investments 207,990 143,346 (80,585) 282,344 Miscellaneous 132,581 89,326 203,566 214,302 Total Revenues 4,684,216 10,407,452 5,111,985 5,418,811 Expenditures General government 774,783 1,002,640 808,790 748,364 Public safety 992,072 1,031,034 972,893 1,006,524 Public works 392,957 393,248 403,811 413,536 Culture and recreation 215,056 346,895 353,316 401,593 Economic development 149,969 54,048 261,318 96,866 Capital Outlay 1,069,953 7,892,095 1,040,402 328,322 Debt service Principal 420,000 590,000 805,700 918,000 Interest 426,125 228,682 315,036 288,757 Bond issuance costs - 67,308 - 7,458 Total Expenditures 4,440,915 11,605,950 4,961,266 4,209,420 Excess (Deficiency)of Revenues Over(Under) Expenditures 243,301 (1,198,498) 150,719 1,209,391 Other Financing Sources (Uses) Transfers in 1,575,525 626,728 697,254 868,993 Bonds refunded - 5,055,000 - 528,062 Bond issuance 2,660,000 3,278,551 - - Payment to refunded bond escrow agent (2,618,259) (3,250,353) - - Premiums on bonds sold 23,652 58,112 - - Sale of capital assets 3,381 - - - Transfers out (1,171,923) (831,121) (1,100,044) (1,062,688) Total Other Financing Sources (Uses) 472,376 4,936,917 (402,790) 334,367 Special Item Decrease in land held for resale - - (3,026,828) - Net Change in Fund Balances $ 715,677 $ 3,738,419 $ (3,278,899) $ 1,543,758 Debt Service as a Percentage of Noncapital Expenditures 20.3% 7.1% 26.0% 29.6% 134 Table 4 Fiscal Year 2015 2016 2017 2018 2019 2020 $ 3,596,744 $ 3,840,259 $ 4,018,573 $ 4,109,257 $ 4,233,810 $ 4,221,332 197,878 174,928 239,833 258,992 215,108 300,888 1,958,201 282,508 268,493 312,506 438,035 2,077,442 648,359 662,313 888,979 845,182 1,004,236 1,076,374 1,000 - 200 1,500 500 - 434,682 246,350 196,021 291,412 259,787 352,949 86,644 103,541 138,248 120,130 384,339 190,441 358,035 537,803 385,472 175,104 138,771 181,825 7,281,543 5,847,702 6,135,819 6,114,083 6,674,586 8,401,251 606,158 738,974 735,742 894,542 791,250 920,918 1,154,656 1,302,463 1,350,500 1,395,937 1,557,191 1,629,347 634,542 431,596 387,744 411,944 437,365 427,682 387,025 445,486 501,693 533,359 748,116 763,021 203,626 76,875 141,632 175,193 178,507 210,170 841,615 883,733 1,470,904 1,010,977 3,380,525 3,646,864 3,191,851 963,240 962,822 992,000 939,000 856,000 234,925 170,635 198,979 140,579 165,017 123,168 7,254,398 5,013,002 5,750,392 5,554,531 8,196,971 8,577,170 27,145 834,700 385,427 559,552 (1,522,385) (175,919) 344,000 295,133 323,424 50,068 151,390 - 235,000 - - - - - 3,450 - 49,020 - 6,119 - (344,000) (295,133) (370,240) (50,068) (151,390) - 238,450 - 2,204 - 6,119 - $ 265,595 $ 834,700 $ 387,631 $ 559,552 $ (1,516,266) $ (175,919) 52.5% 25.2% 26.4% 24.5% 20.6% 14.4% 135 City of Albertville, Minnesota Statistical Section (Unaudited) Tax Capacity, Market Value and Estimated Actual Value of Taxable Property (Shown by Year of Tax Collectability) 2011 2012 2013 2014 Taxable Market Value Personal property $ 4,712,900 $ 4,870,500 $ 5,275,300 $ 5,239,900 Real estate 584,020,100 523,802,300 468,964,700 500,588,200 Total Taxable Market Value $588,733,000 $528,672,800 $474,240,000 $505,828,100 Estimated Actual Value of Taxable Property $600,645,500 $528,672,800 $474,240,000 $556,863,100 Taxable Market Value as a Percentage of Estimated Actual Value 98.02 % 100.00 % 100.00 % 90.84 % Tax Capacity Personal property $ 92,398 $ 95,065 $ 103,190 $ 102,426 Real estate 7,312,769 6,663,367 6,088,709 6,379,976 Subtotal 7,405,167 6,758,432 6,191,899 6,482,402 Less:tax increment (21,696) (21,696) (21,696) (23,265) Net Tax Capacity $ 7,383,471 $ 6,736,736 $ 6,170,203 $ 6,459,137 Tax levies General $ 2,373,087 $ 2,429,769 $ 2,423,781 $ 2,397,983 Debt service 722,994 712,503 781,325 902,141 Total $ 3,096,081 $ 3,142,272 $ 3,205,106 $ 3,300,124 Tax capacity rate General 32.141 % 36.067 % 39.282 % 37.125 % Debt service 9.792 10.576 12.663 13.967 Total 41.933 % 46.644 % 51.945 % 51.092 % Source: Wright County Auditor/Treasurer Department 136 Table 5 2015 2016 2017 2018 2019 2020 $ 5,279,500 $ 5,442,200 $ 6,101,100 $ 6,101,100 $ 6,389,500 $ 7,128,500 542,867,500 567,786,000 656,054,200 656,054,200 707,392,300 745,489,800 $548,147,000 $573,228,200 $662,155,300 $662,155,300 $713,781,800 $752,618,300 $595,816,100 $620,513,900 $705,380,300 $705,380,300 $758,532,600 $804,315,050 92.00 % 92.38 % 93.87 % 93.87 % 94.10 % 93.57 % $ 103,325 $ 106,630 $ 111,611 $ 119,863 $ 125,822 $ 140,544 6,780,598 7,026,956 7,384,373 7,961,892 8,513,031 8,952,664 6,883,923 7,133,586 7,495,984 8,081,755 8,638,853 9,093,208 (79,615) (123,377) (169,948) (171,863) (171,188) (179,241) $ 6,804,308 $ 7,010,209 $ 7,326,036 $ 7,909,892 $ 8,467,665 $ 8,913,967 $ 2,547,180 $ 2,749,549 $ 2,863,190 $ 3,056,908 $ 3,442,876 $ 3,414,096 949,967 921,691 916,045 831,410 561,855 781,384 $ 3,497,147 $ 3,671,240 $ 3,779,235 $ 3,888,318 $ 4,004,731 $ 4,195,480 37.435 39.222 % 39.082 % 38.647 % 40.659 % 38.301 % 13.961 13.148 12.504 10.511 6.635 8.766 51.396 52.370 % 51.586 % 49.158 % 47.294 % 47.066 % 137 THIS PAGE IS LEFT BLANK INTENTIONALLY 138 City of Albertville, Minnesota Table 6 Statistical Section (Unaudited) Property Tax Capacity Rates - Direct and Overlapping Governments (Per$1,000 of Tax Capacity) Overlapping Rates Year School School Taxes District District Payable City County No. 885 No. 728 2011 41.933 % 39.303 % 51.355 % 43.483 % 2012 46.644 43.449 52.630 45.542 2013 51.945 44.285 57.195 50.051 2014 51.092 43.450 51.553 51.279 2015 51.396 40.530 51.082 51.635 2016 52.370 39.970 49.102 39.266 2017 51.586 39.599 46.893 36.659 2018 49.158 39.946 47.950 36.137 2019 47.294 44.273 47.143 32.865 2020 47.066 44.421 45.280 34.371 Source: Wright County Auditor/Treasurer Department Overlapping rates are those of local and county governments that apply to property owners within the City. Not all overlapping rates apply to all City property owners (e.g. the rates for special districts apply only to the proportion of the government's property owners whose property is located within the geographic boundaries of the special district). 139 City of Albertville, Minnesota Statistical Section (Unaudited) Principal Taxpayers Current Year and Ten Years Ago December 31, 2020 2020 Percent Tax of Total Taxpayer Capacity Rank Tax Capacity CPG Partners, LP $ 1,197,704 1 13.44 % Albertville Station LLC 187,510 2 2.10 GMR Albertville LLC 79,250 3 0.89 Centerpoint Energy 77,236 4 0.87 Fraser Building LP 73,554 5 0.83 Mollie LLC 71,560 6 0.80 Evans Park Inc 64,348 7 0.72 Border States Industries, Inc. 59,250 8 0.66 HGP Architectural Glass, Inc. 56,742 9 0.64 Northern States Power Company 55,856 10 0.63 CWB Albertville Crossing, LLC - - William A. Hinks - - Albertville Medical Building, LLC - - Albertville Investments, LLC - - Albertville Plaza, LLC - - Welcome Furniture and Appliances - - Minnegasco, Inc. - - Lake Community Bank - - Totals $ 1,923,010 21.57 % Source: Wright County Auditor/Treasurer Department 140 Table 7 2011 Percent Tax of Total Capacity Rank Tax Capacity $ 1,103,256 1 14.94 % 67,222 5 0.91 212,692 2 2.88 91,788 3 1.24 81,434 4 1.10 65,678 6 0.89 59,796 7 0.81 50,312 8 0.68 48,571 9 0.66 43,838 10 0.59 $ 1,824,587 24.71 % 141 City of Albertville, Minnesota Table 8 Statistical Section (Unaudited) Property Tax Levies and Collections Last Ten Fiscal Years (1) Percent Collection Percentage Collection of Total Fiscal Total of Current of Levy in Subsequent Total Collections Year Levy Year's Levy Collected Years Collections to Levy 2011 $ 3,096,081 $ 2,921,031 94.35 % $ 173,005 $ 3,094,036 99.93 % 2012 3,142,272 3,122,843 99.38 16,938 3,139,781 99.92 2013 3,205,106 3,160,647 98.61 35,279 3,195,926 99.71 2014 3,300,124 3,263,343 98.89 44,808 3,308,151 100.24 2015 3,497,147 3,461,796 98.99 24,315 3,486,111 99.68 2016 3,671,240 3,641,148 99.18 11,191 3,652,339 99.49 2017 3,779,235 3,753,984 99.33 6,748 3,760,732 99.51 2018 3,888,318 3,864,947 99.40 7,905 3,872,852 99.60 2019 4,004,731 3,977,179 99.31 20,416 3,997,595 99.82 2020 4,195,480 4,177,746 99.58 - 4,177,746 99.58 Source: Wright County Auditor/Treasurer Department (1) Includes state paid property tax credits. 142 City of Albertville, Minnesota Table 9 Statistical Section(Unaudited) Ratios of Outstanding Debt by Type Last Ten Fiscal Years Governmental Activities Business-type Activities General Lease General General Total Fiscal Obligation Revenue Obligation Obligation Primary Percentage of Per Year Bonds Bonds Revenue Bonds Bonds Government Personal Income Capita 2011 $ 6,218,652 $ 2,875,000 $ 4,493,072 $ 780,000 $ 14,366,724 5.43 % $ 2,020 2012 14,013,689 - 4,121,748 1,228,065 19,363,502 6.97 2,705 2013 13,202,695 - 6,257,381 1,171,759 20,631,835 7.34 2,861 2014 12,807,462 - 5,855,190 1,242,391 19,905,043 6.75 2,747 2015 9,845,317 - 3,120,172 606,085 13,571,574 4.48 1,869 2016 8,876,782 - 2,635,154 536,019 12,047,955 3.73 1,647 2017 7,908,666 - 2,365,136 466,535 10,740,337 3.20 1,457 2018 6,911,370 - 2,090,118 395,229 9,396,717 2.66 1,268 2019 5,967,076 - 7,656,726 318,923 13,942,725 4.00 1,863 2020 5,104,343 - 7,064,673 242,617 12,411,633 3.20 1,651 Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements. See the Schedule of Demographic and Economic Statistics on page 149 for personal income and population data. 143 City of Albertville, Minnesota Table 10 Statistical Section (Unaudited) Ratios of General Bonded Debt Outstanding Last Ten Fiscal Years Less Amounts Percentage of General Available in Net Estimated Actual Fiscal Obligation Debt Service Bonded Value of Per Year Bonds Funds Debt Taxable Property Capita 2011 $ 6,998,652 $ 331,460 $ 6,667,192 1.11 % $ 937 2012 15,241,754 6,793,300 8,448,454 1.60 1,180 2013 14,374,454 3,244,236 11,130,218 2.35 1,544 2014 14,049,853 3,970,721 10,079,132 1.81 1,391 2015 10,451,402 6,189,942 4,261,460 0.72 587 2016 9,412,801 2,942,019 6,470,782 1.04 884 2017 8,375,201 3,216,178 5,159,023 0.73 700 2018 7,306,599 3,133,185 4,173,414 0.59 563 2019 6,285,999 5,268,736 1,017,263 0.13 136 2020 5,346,960 4,979,787 367,173 0.05 49 Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements. See the Schedule of Demographic and Economic Statistics on page 149 for population data. See the Schedule of Tax Capacity, Market Value and Estimated Actual Value of Taxable Property for property value data. 144 City of Albertville, Minnesota Table 11 Statistical Section (Unaudited) Computation of Direct and Overlapping Debt December 31, 2020 Gross Amount Bonded of Debt Used Percentage Net Debt For Net Debt Applicable to Applicable Calculation District to District Direct Debt City of Albertville $ 5,104,343 100.00 % $ 5,104,343 School District#885 167,170,000 24.56 41,056,952 School District#728 207,155,000 4.47 9,259,829 Wright County 153,290,000 5.05 7,741,145 Total Overlapping Debt 527,615,000 11.00 58,057,926 Total Direct and Overlapping Debt $532,719,343 11.86 % $ 63,162,269 Sources : Market value data used to estimate applicable percentages provided by the Wright County Auditor/Treasurer department. Debt outstanding data was provided from the same source. Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the City. This process recognized that,when considering the government's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government. * The percentage of overlapping debt applicable is estimated using taxable market property values. Applicable percentages were estimated by determining the portion of the county's taxable market value that is within the City's boundaries and dividing it by the county's total taxable market value. 145 City of Albertville, Minnesota Statistical Section (Unaudited) Legal Debt Margin Information Last Ten Fiscal Years Fiscal Year 2011 2012 2013 2014 Debt Limit (1) $ 17,661,990 $ 15,860,184 $ 14,227,200 $ 15,174,843 Total Net Debt Applicable to Limit - - - - Total $ 17,661,990 $ 15,860,184 $ 14,227,200 $ 15,174,843 Total Net Debt Applicable to the Limit as a Percentage of Debt Limit $ - $ - $ - $ - (1) The debt limit is 3 percent. (2)All of the City's general obligation debt are paid from special assessments and not subject to the limit. Note: Under state law, the City's outstanding general obligation debt should not exceed 3 percent of the market value of taxable property. By law, the general obligation debt subject to the limitation may be offset by amounts set aside for the extinguishment of those obligations. 146 Table 12 Fiscal Year 2015 2016 2017 2018 2019 2020 $ 16,444,410 $ 17,196,846 $ 19,864,659 $ 19,864,659 $ 21,413,454 $ 22,578,549 $ 16,444,410 $ 17,196,846 $ 19,864,659 $ 19,864,659 $ 21,413,454 $ 22,578,549 Legal Debt Margin Calculation for Fiscal Year 2019 Taxable Market Value $752,618,300 Debt Limit (3% of Market Value) $ 22,578,549 Debt Applicable to Limit General Obligation Bonds (2) - Less: Amount Available in Debt Service Funds - Total Net Debt Applicable to Limit - Legal Debt Margin $ 22,578,549 147 City of Albertville, Minnesota Table 13 Statistical Section (Unaudited) Pledged-Revenue Coverage Last Ten Fiscal Years General Obligation Revenue Bonds (1) Net Fiscal Gross (2) Revenue Debt Service Year Revenue Expenses Available Principal Interest Coverage 2011 $ 721,901 $ 305,686 $ 416,215 $ 323,335 $ 158,296 0.86 2012 733,830 346,894 386,936 362,193 161,360 0.74 2013 734,049 453,240 280,809 371,549 180,056 0.51 2014 771,239 439,487 331,752 394,373 171,371 0.59 2015 915,048 473,470 441,578 2,727,200 159,973 0.15 2016 836,374 464,576 371,798 477,200 49,281 0.71 2017 904,445 425,770 478,675 262,200 43,730 1.56 2018 948,167 439,181 508,986 265,900 41,124 1.66 2019 1,109,813 565,587 544,226 270,900 37,421 1.77 2020 1,016,245 627,732 388,513 575,900 148,695 0.54 Lease Revenue Bonds Revenue from Fiscal Property Debt Service Year Taxes Principal Interest Coverage 2011 $ 518,415 $ 285,000 $ 253,620 0.96 2012 - - - - 2013 - - - - 2014 - - - - 2015 - - - - 2016 - - - - 2017 - - - - 2018 - - - - 2019 - - - - 2020 - - - - 148 City of Albertville, Minnesota Table 14 Demographic and Economic Statistics Last Ten Fiscal Years Total Per Capita Fiscal Number of Persons per Personal Personal Median School Unemployment Year Population(1) Households(2) Household(2) Income(3) Income(4) Age(5) Enrollment(6) Rate(7) 2011 7,114 2,397 2.97 $264,612,344 $ 37,196 28.8 5,235 5.6 % 2012 7,159 2,408 2.97 277,747,723 38,797 28.8 5,621 6.2 2013 7,211 2,422 2.98 281,229,000 39,000 34.6 5,725 5.2 2014 7,247 2,434 2.98 308,178,675 42,525 34.6 5,725 3.9 2015 7,262 2,411 3.01 321,866,364 44,322 34.6 5,900 2.8 2016 7,317 2,476 2.96 331,057,665 45,245 34.6 6,083 3.7 2017 7,370 2,480 2.97 335,335,000 45,500 34.6 6,300 3.5 2018 7,412 2,491 2.98 352,640,724 47,577 34.6 6,300 3.5 2019 7,485 2,516 2.97 348,748,605 46,593 34.6 6,300 3.2 2020 7,519 2,527 2.98 388,048,071 51,609 36.6 6,300 3.7 Data Sources (1) Minnesota Office of the State Demographer (2) Minnesota Office of the State Demographer(2008-2016); Estimated(2017-2019) (3) Calculated by the City. (4) US Department of Commerce-Bureau of Economic Analysis(2008-2016); Estimated(2017) (5) US Census Bureau (6) Independent School District 885 (7) United States Department of Labor-Bureau of Labor Statistics Note:Persons per household information was not available for 2018.The City estimated this year based on averages from data compiled for years 2009-2017. Note:The unemployment rate is for Wright County,the County of which the City is located.Unemployment data was not available for the City. Note:The per capital personal income is for Wright County,the County of which the City is located. Per capita personal income was not available for the City. Note:School enrollment is for Independent School District 885.The School District also includes students from the City of St. Michael. 149 City of Albertville, Minnesota Principal Employers Current Year and Ten Years Ago 2020 Percentage of Total City Employer Employees Rank Employment ISD No. 885, St. Michael-Albertville 949 1 18.98 % Outlets at Albertville 500 2 10.00 Coborn's 198 3 3.96 Oldcastle Building Envelopes 150 4 3.00 Fehn Gravel and Excavating, Inc. 80 5 1.60 Guardian Angels - Engel Haus 65 6 1.30 Mold-Tech, Inc. 61 7 1.22 Don's Bus Service 50 8 1.00 Sherer Brothers Truss 48 9 0.96 Fraser Steel Co. 40 10 0.80 HGP Industries D J's Total Home Care Center Truss Manufacturing Omann Brothers Otsego Tool and Engineering, Inc. Radiation Tool and Engineering, Inc. Total 5,000 42.82 % Source: Northland Securities *This is an estimation provided by the City. 150 Table 15 2011 Percentage of Total City Employees Rank Employment 660 2 13.20 % 800 1 16.00 130 3 2.60 45 8 0.90 52 5 1.04 45 7 0.90 80 4 1.60 49 6 0.98 38 9 0.76 35 10 0.70 5,000 38.68 % 151 City of Albertville, Minnesota Table 16 Full-time Equivalent City Government Employees by Function Last Ten Fiscal Years Function 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 General Government 5.0 5.0 6.5 6.3 6.3 6.3 6.3 6.7 6.7 6.7 Public Safety Fire Full Time Fire Chief - - - - - 1.0 1.0 1.0 1.0 1.0 Civilians(1) 30 30.0 33.0 30.0 29.0 31.0 29.0 32.0 32.0 30.0 Public Works Engineering 1.0 1.0 1.0 0.3 0.3 0.3 0.3 0.3 0.3 0.3 Maintenance 1.0 1.0 1.0 1.5 1.5 2.0 2.0 2.0 2.0 2.5 Culture and Recreation Parks 1.0 1.0 1.0 1.5 1.5 2.0 2.0 2.0 2.0 2.5 Water 1.5 1.0 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 Sewer 1.5 1.0 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 Total 41.0 40.0 45.5 42.5 41.6 45.6 43.6 47.0 47.0 46.0 Source:City of Albertville (1)The fire department is made up entirely of volunteer civilians.They are used on an on-call basis only. 152 City of Albertville,Minnesota Table 17 Operating Indicators By Function Last Ten Fiscal Years Function 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Fire Firc 257 278 217 229 254 256 276 366 418 414 Inspections 288 360 190 212 211 10 6 195 40 20 Building/Engineering Permits Issued 241 394 391 412 453 542 477 468 494 696 Public Works Street Sweeping(Hours) 69 77 82 74 80 123 115 67 98 100 Snowplowing(Hours) 512 320 330 791 723 387 210 364 610 412 Equipment Repair(Hours) 1,000 1,100 1,200 750 600 692 663 829 925 900 Water New Connections 2 4 14 21 22 24 20 24 25 35 Water Mains Breaks 2 - 2 2 6 3 3 3 2 2 Sewer Average Daily Treatment Flow(Thousands of Go 466,000 490,000 468,000 475,000 510,000 474,000 502,000 484,000 511,000 521,000 Sources:City of Albertville Note:Indicators are not available for the general government function. 153 THIS PAGE IS LEFT BLANK INTENTIONALLY 154 City of Albertville, Minnesota Table 18 Capital Asset Statistics by Function Last Ten Fiscal Years Function 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Public Safety Fire stations Stations 1 1 1 1 1 1 1 1 1 1 Public Works Highways and streets Streets(miles) 36 36 36 36 38 38 38 39 39 39 Street lights 417 417 417 417 417 417 417 417 430 430 Traffic signals 5 5 6 7 7 7 7 7 7 7 Culture and Recreation Parks division Parks 11 11 11 11 11 11 11 11 12 12 Parks acreage 120 120 125 125 125 125 125 125 131 131 Arena/Civic Center 1 1 1 1 1 1 1 1 1 1 Baseball diamonds 4 4 4 4 4 4 4 4 4 4 Basketball courts 5 5 5 5 5 5 5 5 5 5 Bike trails(miles) 5 5 5 5 5 5 5 5 5 5 Hockey rinks/outdoor 2 2 2 2 2 2 2 2 2 2 Softball diamonds 2 2 2 2 2 2 2 2 2 2 Tennis courts 5 5 5 5 5 5 5 5 5 5 Volleyball courts 1 1 1 1 1 1 1 1 1 - Utilities Water Miles of water main 52 52 52 52 52 52 52 52 55 55 Consumers Maximum daily capacity(gallons) Sewer Miles of sanitary sewer 37 37 37 37 37 37 37 37 39 39 Lift stations 10 10 10 10 10 10 10 10 10 10 Maximum daily treatment capacity(gallons) 929,000 929,000 929,000 929,000 929,000 929,000 929,000 929,000 929,000 929,000 Storm sewer Miles of storm sewer 35 35 35 35 35 35 35 35 36 36 Source:City of Albertville Note:No capital asset indicators are available for the general government function. 155