08-24-2020 Council Work Session Packet

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• Pavement Management Fund – This fund is used for the maintenance of Non Municipal State Aid roads. The funding source for this fund is an annual levy (currently $617,450), transfer of excess fund balance, and through the sale of bonds. The debt service associated with this fund is paid through taxes. • Enterprise Funds – As part of owning and operating the water, sewer, and storm sewer utilities, the City charges fees for providing service to the end users. The City also pursues grant money for improvements when applicable. The City evaluates the rate structure for each of these utilities to ensure that the income generated is sufficient to pay both operating costs and needed improvements. • Construction Funds: 429 Improvement Bonds – The improvements identified in this report such as street reconstruction, water main replacement, and sanitary sewer replacement may be funded by issuing bonds. State law allows the City to issue bonds for improvements and assess the properties that benefit from the project for a portion of the costs. The payback period for the bonds varies but is typically 10 to 20 years. The revenue for debt payment of the bonds would be from special assessments and/or City taxes. • Permanent Improvement Revolving (PIR) Fund – This fund is for temporary funding of projects prior to the sale of bonds or the levy of Special Assessments. The source of funding for this fund is through Special Assessments, Interest, and the repayment of expenditures from permanent funding sources. • IT Fund – This is a newly created internal service fund that will be the funding source for Technology upgrades. Funding is through annually budgeted “IT Services” charges to City Departments. • Building Fund – This will be a newly created fund that will be the funding source for the construction of new facilities and capital maintenance of existing facilities. Initial funding will be through a General Fund transfer. Council Work Session 8/24/20 Page # 14