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» « <br />ii <br />To the City Council and Citizens of the City of Orono <br />May 15, 1998 <br />Sewer Operating Fund <br />The Sewer Operating Fund accounts for the provision of sewer services to the residents of the City <br />who have sanitary sewer service available. All activities necessary to provide such services are <br />accounted for in this fund, including administration, operations, maintenance, billing, and collection. <br />The summary of operations for 1997 and 1996 is as follows: <br />December 31 <br />1997 1996 <br />—Operating revenue $ 638,280 $ 621,235 <br />Operating expenses 688.989 765.045 <br />Operating loss $ (50.709)$ (143,810) <br />The operating expenses in 1997 decreased as a result of a reduction in maintenance and repairs and <br />from continued efforts to reduce groundwater inflow and infiltration into the sanitary sewer system. <br />This resulted in lower measured flows and subsequent treatment costs with the Metropolitan Council <br />Environmental Services (MCES). <br />The operating loss for 1997 does not include nonoperating revenues of $137,008 or nonoperating <br />expenses of $26,772. The operating loss for 1996 also does not include nonoperating revenue of <br />$135,093 or nonoperating expenses and transfers out of $111,564. Retained earnings as of <br />December 31, 1997 were $1,967,525, which represents an increase of $217,692 from 1996, net of <br />the effects of depreciation on contributed assets and nonoperating items. <br />Golf C ourse Operating Fund <br />The Golf Course Operating Fund accounts for the operation of the City-owned and operated golf <br />course facility. All activities necessary for operations are accounted for in this fund, including <br />administration, operations, and maintenance. <br />The summary of operations for 1997 and 1996 is as follows: <br />December 31 <br />1997 1996 <br />Gross profit and operating revenue $ 206,464 $ 192,353 <br />Operating expenses 152.436 144.658 <br />Operating income $ 54.028 $ 47.695 <br />The operating income for 1997 does not include nonoperating revenue of $15,687. The operating <br />income for 1996 does not include nonoperating revenue of $12,573, and nonoperating expenses of <br />$3,252. Retained earnings as of December 31, 1997 were $397,021, which represents an increase <br />of $70,368 from 1996, net of the effects of depreciation on contributed assets and nonoperating <br />Items. <br />-11-