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IN; <br />IP'-,v <br />I p-f..: . <br />I <br />I <br />Ite:I <br />I <br />I- <br />Fr I <br />I <br />t;:." <br />p J-K <br />I <br />Ifci'vS- <br />k""''h> <br />■m- <br />I , .u, .4., <br />K <br />I s.-: * <br />,5, :v . <br />' /'r <br />I <br />I <br />I <br />■V. <br />fv_. <br />CITY OF ORONO, MINNESOTA <br />Notes to Financial Statements (continued) <br />December 31, 1991 <br />NOTE 13 - COMMITMENTS AND CONTINGENCIES (CONTINUED) <br />The City was named as defendant in a case filed in July 1990. The suit alleges the City caused the illegal <br />nmoval of a nonconforming boat dock without compensation and that the City ordinances relating to boa; <br />docks are vague. The plaintiffs are seeking compensation in an amount in excess of $50,000. The City's <br />famirer is providing defense of this claim. <br />Sewal othw claims have been filed against the City. The City's insurei has accepted defense of these <br />Tilt outcome of each of these cases is unknown It is not determinable at this time whether unfavorable <br />lettlemeflis of the claims will exceed insurance coverage City management believes that the City will <br />not incur any monetary loss relating to the cases No loss has been recorded on the City’s financial <br />aiaicmcfitt rdating to the claims. <br />During the year ended December 31, 1991, the City awarded certain contracts for various construction <br />projacta for the Water and Sewer Funds and for the construction of the new City facilities. The City’s <br />commitmeni lor uncompleted work on these contracts ;*t December 31, 1991 was approximately <br />$893,700. <br />Faeilitv I <br />Diirillg the year ended December 31, 1991 . the City entered into an unconditional lease with the Housing <br />and Raitovtdopment Authority of Orono for the City Hall and the police and public works facilities. The <br />leaM with an option to purchase continues until February 1 . 2008 or until terminated through cancellation <br />by not af^ropriating sufficient funds for payment, defeasance, default. 0. purchase of the project by the <br />City. *rhe City is responsible for the real estate taxes, insurance, utilities, and maintenance of die <br />property. There was no rent expense in 1991. <br />Minimum rental commitments under the lea.se at December 31. 1991 are <br />Year Amount <br />1992 S 155.232 <br />1993 2.32.848 <br />19^4 394.135 <br />I9V5 3%.266 <br />19%402.455 <br />Thereafter 4.919 104 <br />f 6.5.J.040 <br />11m lease {nirchasa payments will equal the principal and into^est due on the HRA Public FacUitiM Bond <br />of 1991 issued to construct the facilities. <br />............................■ <br />A... - . <br />•'•4