01-10-2005 Council Packet - Laserfiche WebLink

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is reflected in an extremely high full value per capita of $299,234. While the proposed merger with the neighboring City of Long Lake did not pass voter approval, inter-governmental relations continue to be strong, with various shared operations continuing. Expansion of Highway 12 is expected to prompt high-end commercial and retail development in the city. HISTORICALLY SOUND FINANCIAL OPERATIONS IMPROVES IN FISCAL 2003 Moody's expects the city's historically sound financial operations to continue given a history of conservative budgeting practices, resulting in the maintenance of favorable reserve levels. After two years of increased one-time capital outlay expenditures (acquisition of various parcels of land) resulted in operating deficits In fiscal 2000 and 2001, the city Irwreased reserves to previous levels in fiscal 2003. The fiscal 2003 undesignated General Fund balance was $2.24 million, a healthy 43%of General Fund revenues. Reserves were boosted by a one-time land sale yielding $471,000 and an operating surplus of $370,000, primarily attributed to increased permit fee and charge for service revenues. Fiscal 2004 is expected to end with a modest operating surplus and management expects balanced operations in fiscal 2005. Stability and strength in financial operations are eviderK:ed by the city's diverse revenue sources: 48% property taxes. 21% charges for services and 8% special assessments. The charges for services reflect revenues received from neighboring communities in exchar>ge for Orono providing public safety services. The Joint powers agreements have three- and five-year commitments. As a property wealthy community, the city does not rely on Local Government Aid (LGA), mitigating Orono's exposure to potential state aid reductions, as the State works to dose its budget gaps. MODEST DEBT BURDEN CHARACTERIZED BY RAPID AMORTIZATION Moody's expects the dty's moderate debt burden of 1 3% to decline due to expected tax base growth, rapid prindpal amorti^tion, and lack of future borrowing plans. The Minnesota Department of Transportation is furnfing substarMai infrastructure work on the Highway 12 project, minimizing the funding responsibility of the city: the State has reportedly already committed the money to the project. The city does not have additional borrowing plans at this time. KEY STATISTICS Population (2000 census); 7,538 1999 median family income; $101,114 (178% of state) 1999 per capita Income: $65,825 (284% of state) 2003 hill valuation: $2.3 billion Residential properties as % of total assessed valuation: 93% Full value per capita: $299,234 Debt burden: 1.3% Direct debt burden: 0.3% Debt per capita; $984 FY03 General Fund balance: $2 26 million (47% of General Fund revenues) Post-sale parity debt outstanding: $3.5 million Analysto Sara A. Schnoor 312-706-9960 Public FinarKe Group Moody's Investors Service Jonathan North 312-706-9973 Public Finance Group Moody's Investors Service