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08-26-2019 Council Packet
Agenda Council Meeting Monday, August 26, 2019, 7:00 P.M. Orono Council Chambers, 2780 Kelley Parkway, Orono, MN 55356 952-249-4600 / www.ci.orono.mn.us The public is invited to address the council regarding any item on the regular agenda. If your topic is not on the agenda, you may speak during the Public Comments section. Roll Call Pledge of Allegiance Approval of Agenda Consent Agenda 1. City Council Meeting Minutes of August 12, 2019 2. Work Session Meeting Minutes of August 12, 2019 3. Claims/Bills 4. Approval of 2019 Commercial Kennel License 5. Fire Department Door Access Improvement Request 6. Oliver Hill — Formal Acceptance Public Improvements — Resolution 7. 2017-18 Sanitary Sewer I&I Grant Resolution 8. Wayzata Boulevard (CSAH 112) Phase Two Landscaping Design Proposal 9. LAI 9-000033 —Chuck Alcon o/b/o Eric and Andrea Larson, 690 Brown Road, Final Plat and Development Agreement Approval 10. LAI 9-000049 — Eskuche, 2605 North Shore Drive, Variances and Interim Use Permit — Resolution 11. LA19-000066 — Original File #17-3968 — Frederick Johnson, 1565 Orchard Beach Place, 2nd Extension of Resolution No. 6802 - Resolution Public Comments — (Limit 5 Minutes per Person) This is an opportunity for the public to address matters not on the agenda. The council will not engage in discussion or take action on items presented at this time. However, the council may refer issues to staff for follow up or consideration at a future meeting. Speakers should state their name and home address at the podium before speaking. Presentation 12. 2018 Audit Presentation Finance Director Report 13. Request for Proposals for Audit Services Mayor/Council Report Sign up for email notifications at www.ci.orono.mn.us — follow links for Stay Connected & Email Notification Agenda Council Meeting Monday, August 26, 2019, 7:00 P.M. Orono Council Chambers, 2780 Kelley Parkway, Orono, MN 55356 952-249-4600 / www.ci.orono.mn.us City Administrator Report 14. Property Proposal Discussion City Attorney Report Closed Session The meeting will be closed as permitted by section 13D.03 to discuss the City's labor negotiation strategy related to the City's negotiations with Local No. 49 Union Adjournment Upcoming Events 2019 09-02-19 Official Holiday— City Offices Closed 09-03-19 Park Commission Meeting, Tuesday 6:30 p.m. 09-09-19 City Council Meeting, Monday, 7:00 p.m. 09-16-19 Planning Commission Meeting, 6:30 p.m. (Matt Johnson) 09-23-19 City Council Work Session, Monday, 5:00 p.m. 09-23-19 City Council Meeting, Monday, 7:00 p.m. 10-14-19 City Council Meeting, Monday 7:00 p.m. 10-21-19 Planning Commission Meeting, 6:30 p.m. (Dennis Walsh) 10-28-19 City Council Work Session, Monday, 5:00 p.m. 10-28-19 City Council Meeting, Monday, 7:00 p.m. Sign up for email notifications at www.ci.orono.mn.us — follow links for Stay Connected & Email Notification MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, August 12, 2019 7:00 o'clock p.m. ROLL CALL The Orono City Council met on the above-mentioned date with the following members present: Mayor Dennis Walsh, City Council Members Richard Crosby, III, Matt Johnson, and Victoria Seals. Representing Staff were City Administrator Dustin Rief, Finance Director Ron Olson, Development Director Jeremy Barnhart, City Planner Laura Oakden, Public Works Director/City Engineer Adam Edwards, City Attorney Soren Mattick, and Recorder Jackie Young. Mayor Walsh called the meeting to order at 7:00 p.m., followed by the Pledge of Allegiance. APPROVAL OF AGENDA CONSENT AGENDA 1. CITY COUNCIL MEETING MINUTES OF JULY 22, 2019 2. CITY COUNCIL WORK SESSION MINUTES OF JULY 22, 2019 3. CLAIMSBILLS 4. ANNUAL SPORTSMEN'S GUN CLUB — LIMITED USE PERMIT 5. HOSTED SERVERS 6. BEDERWOOD SPORTS FIELD AWARD 7. EAST LONG LAKE TRAIL DESIGN AND ENGINEERING APPROVAL 8. SEWER PUMPS REPLACEMENT 9. APPOINTMENTS OF SEASONAL EMPLOYEES 10. LA19-000033 CHUCK ALCON ON BEHALF OF ERIC AND ANDREA LARSON, 690 BROWN ROAD, FINAL PLAT AND DEVELOPMENT AGREEMENT APPROVAL This item was removed from the Agenda. 11. LA18-000038 JAMES AND MARY JUNDT, 1400 BRACKETS POINT ROAD, DEVELOPMENT AGREEMENT AMENDMENT APPROVAL 12. LA19-000050 PAUL VOGSTROM ON BEHALF OF ERIC VOGSTROM, 2710 PENCE LANE, VARIANCES — RESOLUTION NO. 7007 13. LA19-000051 DALE GUSTAFSON ON BEHALF OF JOHN AND TRUDY WILGERS, 1905 CONCORDIA STREET, VARIANCE — RESOLUTION NO. 7008 Crosby moved, Seals seconded, to approve the Consent Agenda as revised, with the deletion of Items No. 10 and 14 from the Consent Agenda, and with the deletion of Item 15 from the Regular Agenda. VOTE: Ayes 4, Nays 0. Page 1 of 8 MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, August 12, 2019 7:00 o'clock p.m. PUBLIC COMMENTS None 14. CITY CLERK JOB DESCRIPTION REVISION Rief stated earlier this year he received a request to review the city clerk position. A few minor changes were made to the position, including some minor changes to employee supervision and election duties. Staff's recommendation is that the election responsibilities be moved from what is considered contributory to primary because the clerk has the sole authority around elections, which increased the score of the position and moved it from a Grade 10 to Grade 11 of the wage scale. Johnson asked from what position those new supervision responsibilities came from. Rief indicated in the past the front desk employees reported to the City Administrator and now they will report to the city clerk, who is considered an exempt employee. Those responsibilities were not reflected in the job description. The review also discovered some issues with the record site. Staff felt in the future hiring someone with more education for the position would be appropriate, such as a bachelor's degree, and that someone with a two-year degree would not be considered for a city of this size. Johnson asked whether there was a supervisor within the administrative staff that handled the supervision of the front desk. Rief indicated it originally went straight to him versus the city clerk, and since the city clerk has communication and supports all departments, it was deemed appropriate to realign that. Seals moved, Crosby seconded, to approve the change in the city clerk job description and to approve the change in pay grade from 10 to 11. Vote: Ayes 4, Nays 0. PRESENTATION 15. 2018 AUDIT PRESENTATION This item was removed from the agenda. PLANNING DEPARTMENT REPORT 16. LA19-000047 SCOTT GATES ON BEHALF OF KRUCKEBERG REAL ESTATES, 4400 DEERING ISLAND, COMPREHENSIVE PLAN AMENDMENT, AMEND MUSA BOUNDARY, RESOLUTION Scott Gates, Applicant, was present. Barnhart stated the applicant is requesting that Deering Island be incorporated into the City of Orono's Municipal Urban Service Area (MUSA). The designation would allow the property to connect to sanitary sewer service. The City of Mound would provide the connection and treatment of the sanitary sewer. Page 2 of 8 MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, August 12, 2019 7:00 o'clock p.m. The Comprehensive Plan does contemplate the expansion of the MUSA boundary and contains six priorities that should be considered whenever expansion is being considered. The subject parcel appears to satisfy the first priority, as the island is completely surrounded by the lake. Expanding the MUSA to include the subject parcel does not suggest or imply an expansion or an increase in density. No changes to the land use or zoning are proposed with this application. The Planning Commission recommended approval of the application. Scott Gates, Kruckeberg Real Estate Holdings. Walsh asked who the individual is that owns Kruckeberg Real Estate Holdings and whether this property is going to be homesteaded. Gates indicated Craig is the owner of this parcel as well as the adjacent property and that it will not be homesteaded. Gates stated to his understanding the intent is to make it more of a family compound and that it is likely at some point in the future they will build a larger residence there instead of the existing cabin. Walsh asked whether there is any intent to rent out the island. Gates stated there could be some special events on the island, such as weddings and private parties, but there is no intent to do overnight rentals. Seals asked if any helicopters will be bringing people in. Gates stated not if they have anything to do with it. Walsh commented the City Council has received some interesting calls about the island and that it would be nice to speak with Craig. Gates indicated he did speak with Police Chief Farniok and that they will be having further discussions to make sure things are done properly in the future. Gates noted this was a last-minute situation by an individual that had done a birthday party ten years ago. The staff at his company was planning the event and Kruckeberg became aware at the last minute of that and has since jumped in to make sure sound levels and everything were being addressed. Gates stated to his knowledge there were not any sound issues and that they will be developing a checklist for any future events that may occur in the future so there will be a process in place to deal with them. Gates indicated he personally visited a number of the neighbors on the lake and he was surprised that the comments on Facebook were generally pretty positive by people. Crosby asked what his relationship is to the property owner. Gates indicated he represents them and that he is a developer. Walsh stated he would like to see some more definite plans for the island prior to approving things, and given what has happened, this application is off to a poor start and took a lot of people by surprise in a couple different cities. Page 3 of 8 MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, August 12, 2019 7:00 o'clock p.m. Seals stated there was clearly a lot done out there and that she did not receive any positive phone calls about it. Seals stated it is a little concerning to expand the scope when what is currently going on has not been rectified. Crosby commented it would have been nice to see the owner this evening. Walsh stated a family compound and an event center are two different things. Gates stated it is not intended to be an event center and it is not intended to be an event island. Those would be considered an accessory use on an occasional basis. Gates stated he can ask the owner to appear, but most big companies have people to handle things like this. Gates indicated he personally has been proactive with it once he learned about it and that he has some experience with noise issues, such as being involved in consideration of some racetracks. Also know the owners of Fletcher's and have worked with them to develop some standards for noise. Gates stated he jumped in Wednesday night and did a noise propagation sound map. The noise levels were actually monitored along the shoreline in the afternoon as well as on the island. Communications were also had with the Police Chief and he was sent some snapshots of what the sound level was. Gates stated to the extent they could, they did attempt to address the situation. Walsh noted in the beginning of the application this was talked about as being a family compound and that the event stuff did not come out until later. Walsh indicated he would be in favor of tabling it tonight until all the issues have been sorted through and resolved since changing the MUSA is a touchy thing. Gates stated the extension of the sewer does not really relate to the events going on at the island and that it is the City's call on which way they would like to go. The MUSA expansion will enhance the island no matter what happens on the island. Crosby stated he has some concerns about the events and that it is not what the Council thought it was going to be. Walsh stated further discussion on expanding the MUSA is also warranted to determine its impact on the City's overall density. Johnson and Seals concurred with tabling the application. Walsh moved, Crosby seconded, to table Application No. LA19-000047, Scott Gates on behalf of Kruckeberg Real Estates, 4400 Deering Island, Comprehensive Plan Amendment. VOTE: Ayes 4, Nays 0. 17. LA19-000048 PREMIUM CONSTRUCTION, LLC, 2967 CASCO POINT ROAD, VARIANCE — RESOLUTION NO. 7009 Oakden stated the applicant is requesting average lakeshore setback, hardcover, lot area and lot width variances. The applicant is proposing to remove the existing home and detached garage and build a new home with an attached garage. The average lakeshore setback is unique for this property due to the Page 4 of 8 MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, August 12, 2019 7:00 o'clock p.m. neighboring lot to the north. That lot is flag shaped with the buildable portion set much further back. Due to this configuration, the subject lot is not buildable without an average lakeshore setback variance. The current home is nonconforming due to this extreme setback and hardcover. The applicants are proposing to build a new home with more massing forward of the average lakeshore setback compared to what is there today. The hardcover will decrease from the current level of 30.5 percent to 29.5 percent with the proposed plan but will remain over the 25 percent maximum. The Planning Commission reviewed and discussed the request. The Commission voted 5-1 to recommend approval of the requested variances. Staff recommends approval, subject to the City Engineer's comments, for the lot area, lot width, and hardcover variances. Staff recommends approval of the requested average lakeshore setback. Johnson requested the GIS be displayed. Oakden displayed an aerial of the area and pointed out the neighboring home and the lot that was subdivided. That subdivision resulted in a principal structure on the property and the extreme average lakeshore setback. Crosby asked how far ahead of the current home they will be going. Oakden stated to her knowledge it is around 30 feet. Oakden noted the orange is the footprint of the proposed home. There will be a screen porch that will be approximately 30 by 15 feet, which is forward of the existing patio. Walsh asked where the 75 -foot setback is. Oakden stated it is pretty far forward. Walsh asked if the setbacks are five feet and eight feet. Oakden indicated the 5 -foot is the window well and that there are 8 -foot setbacks on the setback. They are required to meet a 7.8 -foot setback. On the other side there is 12 feet. Walsh commented it is really the average lakeshore setback that is the issue, which will not change the view for the adjoining property, and that the hardcover is being reduced slightly. Crosby asked where the average lakeshore setback line is to the neighboring home. Oakden pointed out the approximate location of the line. The applicants have tried to align the proposed house with the other residences in the area. The red line on the survey is the closest point to the lake, which creates the average Lakeshore setback line. Johnson noted they used two different points of reference, the property to the south, which is not the furthermost point, and the property to the north, which is the furthermost point to the lake. Walsh stated one is 136 feet and the other one is 142 feet. Page 5 of 8 MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, August 12, 2019 7:00 o'clock p.m. Johnson asked which line the Council should use, the closest or the furthest. Oakden indicated it would be the closest point from the neighboring houses for the average lakeshore setback. Johnson commented it appears they are sneaking forward from where they would normally be allowed if it is assumed the one house does not exist. Oakden stated if they use the closest point, which should have been used, the red line would have been more extreme. The proposed house is farther back than the adjoining residence because one of the homes has a closer point to the lake. Johnson asked what the purple corner to the south is. Walsh noted that is not the correct corner. Seals stated the lot in between should be ignored. Johnson stated they are behind where they would be allowed to be because the surveyor put the line in the wrong spot. Walsh stated the average lakeshore setback cannot be met either way. Seals moved, Crosby seconded, to adopt RESOLUTION NO. 7009, a Resolution Approving a Variance from Municipal Zoning Code Section 78-350, 78-1279, and 78-1700 for the property located at 2967 Casco Point Road. VOTE: Ayes 4, Nays 0. MAYOR/COUNCIL REPORT Johnson stated he had nothing to report. Seals noted Long Lake had their Corn Days festival and that the parade and other activities were fun. Crosby stated Orono resident Carolyn Broghammer passed away on August 1 and left behind her husband, children, and grandson. Crosby stated he knew this lady through Orono volleyball and that his heart goes out to the family. Carolyn was an awesome woman, always positive, her kids' biggest fan, and was a great citizen in the City of Orono. Walsh concurred that it was a great Corn Days festival and that they rode on the City Council float and threw out a lot of candy. Tuesday, August 6, was National Night Out. Walsh stated he attended a number of great parties with Council Member Crosby and City Administrator Rief, including one in the Orono Woods development. They had a great country band there and some awards were presented to the police. Crosby noted Xerces was on Channel 11 at the Orono Woods get-together. Walsh noted the Minnesota State Fair is coming up soon as well as the first day of school. Page 6 of 8 MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, August 12, 2019 7:00 o'clock p.m. CITY ADMINISTRATOR REPORT 18. REQUEST FOR PROPOSAL — PROFESSIONAL LEGAL SERVICES Rief noted the City Council a few years ago adopted Resolution 6585 to establish a schedule for the RFP process for all professional services contracted by the City. Staff reviews the document annually for any scheduled RFPs. The civil attorney schedule is for 2019. Staff recommends approval of the Professional Legal Services RFP and to establish an ad-hoc Professional Legal Services RFP review committee. Walsh stated he would be on that committee and that he will appoint Aaron Printup as well. Seals moved, Crosby seconded, to approve the request for proposals for professional legal services and to establish an ad-hoc Professional Legal Services RFP Review Committee by appointing Mayor Dennis Walsh, Council Member Aaron Printup, and City Administrator Dustin Rief to the adhoc review committee. VOTE: Ayes 4, Nays 0. 19. APTIVE ENVIRONMENTAL REQUEST FOR EXTENSION OF SOLICITORS Rief reported in May Staff had administratively approved the City's solicitor licenses for a group of applicants outlined in Staff memo for pest control services. Aptive Environmental has requested an extension. Staff is not allowed to administratively approve an extension. Solicitors are only allowed 10 days per calendar year. The City did receive one complaint about this solicitor from a resident. The contact happened outside of their allotted time frame, which should be taken into consideration when discussing whether an extension should be given. Johnson indicated he is not in favor of an extension. Johnson noted there might be a typo because it says the permit date was May of 2018. Rief stated that was a typo. Johnson noted there was a complaint received in June or July. Rief stated they also approached a house that had a no solicitor sign. Johnson moved, Crosby seconded, to deny an extension of the Solicitor's License for Aptive Environmental. VOTE: Ayes 4, Nays 0. CITY ADMINISTRATOR REPORT, Continued Rief stated National Night Out was a good success and that there were a number of nice parties going on throughout Orono. Rief stated earlier that same day he spent some time with Channel 5 on Big Island. The interview went well and it should be positive coverage of Big Island. Page 7 of 8 MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, August 12, 2019 7:00 o'clock p.m. Rief reported the Fire Advisory Board has agreed to review the personnel proposals as part of a subcommittee and that he is looking for a council member to be a part of that committee. Crosby volunteered to be on the committee. CITY ATTORNEY REPORT CLOSED SESSION Walsh moved, Crosby seconded, to enter into closed session at 7:42 p.m., as permitted by Section 13D.03 to discuss the City's labor negotiation strategy related to the City's negotiations with LELS, Patrol, and LELS, Sergeants. VOTE: Ayes 4, Nays 0. (The City Council was in closed session from 7:42 p.m. to 8:09 p.m.) Walsh moved, Crosby seconded, to reopen the Orono City Council meeting at 8:09 p.m. VOTE: Ayes 4, Nays 0. ADJOURNMENT Walsh moved, Crosby seconded, to adjourn the Orono City Council meeting at 8:10 p.m. VOTE: Ayes 4, Nays 0. ATTEST: Anna Carlson, City Clerk Dennis Walsh, Mayor Page 8 of 8 Orono City Council Work Session Monday, August 12, 2019 Council Chambers 6:00 p.m. PRESENT: Mayor Dennis Walsh, Council Members Richard F. Crosby II, Matt Johnson, and Victoria Seals. Representing staff were City Administrator Dustin Rief, Community Development Director Jeremy Barnhart, and City Clerk Anna Carlson. Meeting Start Time: 6:05 p.m. 1. Accessory Buildings (size/ acreage ratio) Community Development Director Jeremy Barnhart began discussion about Oversized Accessory Building size. Barnhart requested direction from the Council for any change requests they would like to see, specifically related to the current maximum Oversize Accessory Building Footprint area allowed in square feet. There was discussion about the reasoning for a maximum, the need for it, and other requirements that likely limit the sizes. Barnhart mentioned that the process would still go through the Planning Commission and then brought back to Council for final approval. 2. Average Lake Shore Barnhart requested confirmation of goals associated with accommodating various circumstances related to average lake shore. Barnhart recommended there should be some sort of maximum for setbacks, because in some cases current properties may set the setback for other properties. City Administrator Dustin Rief noted the City may want to possibly look at giving them a percentage rather than a specific number. Council Member Matt Johnson suggested the City may want to consider not making any changes to the setback. Walsh mentioned that the City may not need to make a lot of changes but the code should be cleaned up in some sections. Council Member Richard F. Crosby II also agreed that some of the language may need to be cleaned up and logical changes could be considered. Johnson added that by not making huge changes, it will allow the Council to interpret it together. 3. Prioritization of General Amendments Barnhart mentioned that there are a few general amendments that could use some improvements, specifically the ordinances such as Special Events, Subdivisions, and Land uses. Page 1 of 2 Orono City Council Work Session Monday, August 12, 2019 Council Chambers 6:00 p.m. Walsh stated if staff feels a need to make some changes then they should definitely review and make recommendations to Council. Barnhart mentioned that the Special Event ordinance will be reviewed with staff in regards to the review process, impacts of them on the public, and approval authority. Staff does not propose or anticipate a limit to the number of parties at a property, as was briefly discussed in February 2017. Barnhart mentioned that he would like to work closely with the City Attorney in regards to Subdivision Ordinance. Barnhart also mentioned revisiting the land use ordinance to the council however it is not as crucial but it is in need of review. Rief added that Council may want to revisit the use of gardens. Walsh mentioned that maybe it could be somehow specific to City land only. Staff will review the amendments and bring them back to Council at a future meeting for final approval. Meeting End 6:35 p.m. ATTEST: Anna Carlson, City Clerk Dennis Walsh, Mayor Page 2 of 2 AGENDA ITEM Item No.: 3 Item Description: Claims/Bills Date: August 26, 2019 Presenter: Maggie Ung Agenda Consent Agenda Accountant Section: 1. Purpose. The purpose of this action item is to approve payment of claims made on the City for services and/or products provided to the City. 2. Background. The attached claims for payment have been received by the City. Staff has reviewed the claims and is recommending approval of the listing for payment. The claims will be paid by checks 112387 to 112473, totaling $263,391.29. 3. Noteworthy Payments. Vendor Amount Description of Payment #112396 Carmen Bay Lake $10,358.16 Payment for the 1" half of the Carman Bay Lake Improvement District Improvement District Levy. #112409 Cummins NPower $41,771.00 Payment for the purchase of backup generators at Lift Station #1 and Grinder Station #9. #112461 The Broadway Group $54,038.00 Refund of escrow payment for the Oliver Hill development. 4. Staff Recommendation. Staff recommends approval of a motion authorizing payment to the claims list as presented. COUNCIL ACTION REQUESTED Motion to approve the claims list as presented. Exhibits A. Check Register Prepared By: M e U Reviewed By: 1jC Approved By: -1)a City of Orono Check Register - COUNCIL REPORT Page: 1 Check Issue Dates: 8/13/2019 - 8/26/2019 Aug 22, 2019 10:02AM Payee CUBE INC CUBE INC Total 112387: Langton, William Total 112388: Mark D. Williams Homes Inc Mark D. Williams Homes Inc Total 112389: ALL SEASON SPORTS Total 112390: BOLTON & MENK INC. BOLTON & MENK INC. BOLTON & MENK INC. Total 112391: Bridgewater Bank Bridgewater Bank Total 112392: CAMPBELLKNUTSON CAMPBELLKNUTSON CAMPBELLKNUTSON CAMPBELLKNUTSON CAMPBELLKNUTSON CAMPBELLKNUTSON CAMPBELLKNUTSON CAMPBELLKNUTSON CAMPBELLKNUTSON CAMPBELLKNUTSON CAMPBELLKNUTSON Check Check Invoice Invoice GL Account Description Issue Date Number Number 081519 08/16/2019 112387 081319 101-22205 Escorw Refund RPS18-000095 3997 Webb St 08/16/2019 112387 081319 101-39615 Escorw Refund RPS18-000095 3997 Webb St 08/16/2019 112388 081319 101-22205 Escrow Refund RAS18-000078 2870 Little Orchard 08/16/2019 112389 081519 101-22205 Escrow Refund RPS18-000020 2697 Casco Pt Rd 08/16/2019 112389 081519 101-39615 Escrow Refund RPS18-000020 2697 Casco Pt Rd 08/26/2019 112390 0080619104 101-42110-226 Uniforms 08/26/2019 112391 0237081 101-43170-305 2019 GIS Maintenance 08/26/2019 112391 0237081 601-49400-305 2019 GIS Maintenance 08/26/2019 112391 0237081 101-45200-305 2019 GIS Maintenance 08/26/2019 112392 082119 101-22205 Escrow - Apply to Oliver Hill / The Broadway Group 08/26/2019 112392 082219 101-22205 Escrow -Apply to Unpaid AR on Cust. #105274 08/26/2019 112393 OOOOG-164 101-41600-307 Personnel/City Code 08/26/2019 112393 OOOOG-164 651-49910-307 Drainage Issue 08/26/2019 112393 OOOOG-164 101-41600-307 General Legal 07/19 08/26/2019 112393 OOOOG-164 101-42110-307 LELS Contract 08/26/2019 112393 0004G-152 101-42110-307 Police Matters 07/19 08/26/2019 112393 0115G-107 101-41600-308 Code Enforcement 07/19 08/26/2019 112393 0150G-97 101-41600-307 Contempt Matter 07/19 08/26/2019 112393 0201G-86 101-41600-307 Misc Recordings 07/19 08/26/2019 112393 0571G-8 101-43280-307 LA18-000078 Orono Orchard Hill Plat 08/26/2019 112393 0611G-2 101-43280-307 LA1 9-000017 4300 North Shore Dr 08/26/2019 112393 0613G-2 101-43280-307 LA19-000046 855 Old Crystal Bay Rd S Department Invoice Amount 1,000.00 970.00 1,000.00 1,000.00 21.00 - Police Department 91.00 Engineering 600.00 Water 2,335.00 Parks 680.00 3,615.00 Law/Legal Services 418.50 Storm Water 62.00 Law/Legal Services 1,017.60 Police Department 165.00 Police Department 986.50 Law/Legal Services 139.50 Law/Legal Services 232.50 Law/Legal Services 859.25 Special Services 110.15 Special Services 246.50 Special Services 328.30 City of Orono Check Register - COUNCIL REPORT Page: 2 Check Issue Dates: 8/13/2019 - 8/26/2019 Aug 22, 2019 10:02AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount CAMPBELL KNUTSON 08/26/2019 112393 0614G-2 101-43280-307 LA19-000033 690 Brown Rd / Willow Bay Special Services 525.00 CAMPBELL KNUTSON 08/26/2019 112393 0615G-1 101-43280-307 LA19-000032 2265 N Shore Drive Special Services 75.00 CAMPBELL KNUTSON 08/26/2019 112393 0616G-1 101-43280-307 LA19-000036 577 Park Lane Special Services 75.00 CAMPBELL KNUTSON 08/26/2019 112393 0617G-1 101-43280-307 LA19-000037 565 Hanlon Ave Special Services 100.00 CAMPBELL KNUTSON 08/26/2019 112393 0618G-1 101-43280-307 LA19-000038 140 Leaf St Special Services 100.00 CAMPBELL KNUTSON 08/26/2019 112393 0619G-1 101-43280-307 LA19-000040 3280 Fox St Special Services 75.00 CAMPBELL KNUTSON 08/26/2019 112393 0620G-1 101-43280-307 LA19-000042 1929 Fagerness Pt Rd Special Services 180.00 CAMPBELL KNUTSON 08/26/2019 112393 0621G-1 101-43280-307 LA19-000043 951 Spring Hill Rd Special Services 75.00 CAMPBELL KNUTSON 08/26/2019 112393 0622G-1 101-43280-307 LA19-000039 645 Tonkawa Rd Special Services 275.00 CAMPBELL KNUTSON 08/26/2019 112393 0623G-1 101-43280-307 LA19-000052 385 Orono Orchard Rd S Special Services 75.00 CAMPBELL KNUTSON 08/26/2019 112393 0624G-1 101-43280-307 RAS19-000042 1140 Wyndmere Rd Special Services 153.00 CAMPBELL KNUTSON 08/26/2019 112393 0800G-47 101-42400-307 Staff Meetings 07/19 Building & Zoning 403.00 CAMPBELL KNUTSON 08/26/2019 112393 0801G-47 101-41600-307 Council Meetings 07/19 Law/Legal Services 1,224.50 CAMPBELL KNUTSON 08/26/2019 112393 0802G-47 101-42400-307 B&Z Assistance 07/19 Building & Zoning 962.50 CAMPBELL KNUTSON 08/26/2019 112393 0804G-3 101-42110-307 Review Wage/Insurance Info - LELS Police Department 77.50 Total 112393: 8,941.30 CARDMEMBER SERVICE 08/26/2019 112394 061419-2 101-42110-437 Training - B. Schoenherr Police Department 125.00 CARDMEMBER SERVICE 08/26/2019 112394 070219 701-49800-212 Small Engine Fuel 17.14 CARDMEMBER SERVICE 08/26/2019 112394 080819 602-49450-212 Non -oxygenated Fuel Sewer 80.50 CARDMEMBER SERVICE 08/26/2019 112394 081219 710-49970-221 Spare Bulb for Council Chambers Projector 76.98 CARDMEMBER SERVICE 08/26/2019 112394 081219-1 101-41110-439 WS Meal 8/12/19 Mayor & Council 29.53 CARDMEMBER SERVICE 08/26/2019 112394 081219-2 101-41110-439 Cookies for WS & CC Meetings 8/12/19 Mayor & Council 4.00 CARDMEMBER SERVICE 08/26/2019 112394 081219-3 601-49400-221 Door Hangers for Water Shut Off/Main break 8/12/1 Water 46.00 CARDMEMBER SERVICE 08/26/2019 112394 081319 101-42110-226 2 Uniform Shirts Police Department 159.98 CARDMEMBER SERVICE 08/26/2019 112394 081319-1 101-42110-439 Meeting with LL Fire Chief Police Department 35.38 CARDMEMBER SERVICE 08/26/2019 112394 081419 101-42110-439 GTO Appreciation Luncheon Police Department 79.24 CARDMEMBER SERVICE 08/26/2019 112394 081519 101-42110-402 Squad #261 Carwash Police Department 13.00 CARDMEMBER SERVICE 08/26/2019 112394 081719 101-42110-437 Hunter Safety Program Items for Field Day Police Department 14.22 CARDMEMBER SERVICE 08/26/2019 112394 081919 101-43000-221 PW Bluetooth Headsets Public Works Department 193.44 CARDMEMBER SERVICE 08/26/2019 112394 81619 101-42110-437 Leadership Training - M. Siltala Police Department 250.00 Total 112394: CARGILL SALT 08/26/2019 112395 2904904165 601-49400-216 Total 112395: Carmen Bay Lake Improvement D 08/26/2019 112396 081519 239-25694-489 1,124.41 Nav Wtr Plant Salt Water 5,246.76 5,246.76 1st Half CBLID Payment 10,358.16 City of Orono Check Register - COUNCIL REPORT Page: 3 Check Issue Dates: 8/13/2019 - 8/26/2019 Aug 22, 2019 10:02AM Check Check Invoice Invoice GL Account Payee Issue Date Number Number Total 112396 CECE S SIGNS 08/26/2019 112397 8123 701-49800-402 CECE S SIGNS 08/26/2019 112397 8130 701-49800-402 CECE S SIGNS 08/26/2019 112397 8130 701-49800-402 CECE S SIGNS 08/26/2019 112397 8130 701-49800-402 CECE S SIGNS 08/26/2019 112397 8130 701-49800-402 CECE S SIGNS 08/26/2019 112397 8130 701-49800-402 CECE S SIGNS 08/26/2019 112397 8130 701-49800-402 CECE S SIGNS 08/26/2019 112397 8130 701-49800-402 Total 112397: Century Link 08/26/2019 112398 080419 601-49400-321 Total 112398: Centuryl-ink 08/26/2019 112399 1474054895 614-49840-329 Total 112399: CHUNKS LAKESHORE AUTO 08/26/2019 112400 0016955 101-42110-402 CHUNKS LAKESHORE AUTO 08/26/2019 112400 0016959 101-42110-402 CHUNKS LAKESHORE AUTO 08/26/2019 112400 0016962 101-42110-402 Total 112400: Public Works Department 2.63 Uniform Public Works Department CINTAS CORPORATION 08/26/2019 112401 4027268539 101-43000-226 CINTAS CORPORATION 08/26/2019 112401 4027268539 101-43000-221 CINTAS CORPORATION 08/26/2019 112401 4027754290 101-43000-226 CINTAS CORPORATION 08/26/2019 112401 4027754290 101-43000-221 CINTAS CORPORATION 08/26/2019 112401 4028223642 101-43000-226 CINTAS CORPORATION 08/26/2019 112401 4028223642 101-43000-221 CINTAS CORPORATION 08/26/2019 112401 4028223642 101-43000-404 Total 112401: CITY OF BLOOMINGTON 08/26/2019 112402 1900205 601-49400-489 Description Unit 421 Bucket Truck CIP Cost Unit Renumbering Graphics - Unit 110 Unit Renumbering Graphics - Unit 408 Unit Renumbering Graphics - Unit 409 Unit Renumbering Graphics - Unit 421 Unit Renumbering Graphics - Unit 612 Unit Renumbering Graphics - Unit 623 Unit Renumbering Graphics - Unit 111 Department Invoice Amount 10,358.16 iiu.uu 90.00 20.00 20.00 20.00 20.00 7.00 20.00 Water Plant Phone/Internet 8/4-9/3/19 Water 137.82 137.82 Internet 7/8/19-8/7/19 Cable Franchise 1,051.27 1,051.27 #245 Service Police Department 44.90 #253 Service Police Department 48.35 #249 Service Police Department 44.90 138.15 Uniform Public Works Department 59.54 Shop Towels Public Works Department 2.63 Uniform Public Works Department 59.54 Shop Towels Public Works Department 2.63 Uniform Public Works Department 59.54 Shop Towels Public Works Department 2.63 Mat Service - PW Public Works Department 14.40 zw.y i Bacterial Water Testing Water 31.50 City of Orono Check Register - COUNCIL REPORT Check Issue Dates: 8/13/2019 - 8/26/2019 Page: 4 Aug 22, 2019 10:02AM Payee Check Issue Date Check Number Invoice Number Invoice GL Account Description Department Invoice Amount Total 112402: 31.50 CITY OF CORCORAN 08/26/2019 112403 082019 101-42110-438 3rd Qtr 2019 Toward Zero Deaths Grant Police Department 5,444.87 Total 112403: 5,444.87 CITY OF DAYTON 08/26/2019 112404 082019 101-42110-438 3rd Qtr 2019 Toward Zero Deaths Grant Police Department 11,153.39 Total 112404: 11,153.39 City of Deephaven 08/26/2019 112405 082019 101-42110-438 3rd Qtr 2019 Towards Zero Death Grant Police Department 2,008.04 Total 112405: 2,008.04 CITY OF MEDINA 08/26/2019 112406 082019 101-42110-438 3rd Qtr 2019 Toward Zero Deaths Grant Police Department 6,009.19 Total 112406: 6,009.19 CITY OF ORONO PETTY CASH 08/26/2019 112407 44 101-22205 Escrow -Apply to Inv 20141386 200.00 Total 112407: 200.00 COMMERCIAL ASPHALT 08/26/2019 112408 190731 101-43000-224 2019 Road Patching 19-009 Public Works Department 313.39 COMMERCIAL ASPHALT 08/26/2019 112408 190815 101-43000-224 Road Patching Public Works Department 321.75 Total 112408: 635.14 CUMMINS NPOWER LLC 08/26/2019 112409 E3-29451 602-16500 GS 9 Generator SN#F190595294 19,896.00 CUMMINS NPOWER LLC 08/26/2019 112409 E3-29455 602-16500 LS 1 Generator SN#F190595293 21,875.00 Total 112409: 41,771.00 DAHL, CHRISTOPHER 08/26/2019 112410 082019 101-22205 Escrow Refund 2017-01488 1300 French Creek Dr 1,000.00 Total 112410: 1,000.00 DELTA DENTAL 08/26/2019 112411 7713375 101-21709 4842130001 August 2019 Dental 3,053.06 DELTA DENTAL 08/26/2019 112411 7713375 101-15998 4842130001 August 2019 Dental 436.40 DELTA DENTAL 08/26/2019 112411 7740284 101-21709 4842130001 Septebmer 2019 Dental 3,053.06 City of Orono Check Register - COUNCIL REPORT Page: 5 Check Issue Dates: 8/13/2019 - 8/26/2019 Aug 22, 2019 10:02AM Payee Check Issue Date Check Number Invoice Number Invoice GL Account Description Department Invoice Amount DELTA DENTAL 08/26/2019 112411 7740284 101-15998 4842130001 Septebmer 2019 Dental 436.40 Total 112411: 6,978.92 DPC INDUSTRIES 08/26/2019 112412 827001022-1 601-49400-216 Chlorine & Chemicals Water 2,283.41 Total 112412: 2,283.41 ECM PUBLISHERS INC 08/26/2019 112413 714520 101-42400-340 Public Hearing -August Building & Zoning 68.54 ECM PUBLISHERS INC 08/26/2019 112413 715861 235-45690-352 2018 TIF Disclosure 113.05 ECM PUBLISHERS INC 08/26/2019 112413 717400 101-41900-352 Legal Services RFP Central Services 35.76 Total 112413: 217.35 EHLERS AND ASSOCIATES INC 08/26/2019 112414 80908 235-45690-319 2018 TIF Reporting 3,075.00 EHLERS AND ASSOCIATES INC 08/26/2019 112414 81162 235-45690-319 2018 TIF Reporting 1,470.00 Total 112414: 4,545.00 FASTENAL 08/26/2019 112415 MNPLY11668 701-49800-221 Hardware for Equipment Securement 61.89 Total 112415: 61.89 FERGUSON WATERWORKS #25 08/26/2019 112416 0339803 601-16500 Water Meter Replacement 19-026 2,560.00 FERGUSON WATERWORKS #25 08/26/2019 112416 0340611 601-49400-227 2040 Wayzata Blvd - Gasket and Chamber Water 25.48 Total 112416: 2,585.48 G & G Holding Co Ltd 08/26/2019 112417 082119 101-22205 Escrow Refund 2016-01015 1122 Loma Linda Ave 2,500.00 Total 112417: 2,500.00 GENUINE PARTS COMPANY/NA 08/26/2019 112418 3270-450313 701-49800-222 Hose Clamp 14.97 Total 112418: 14.97 GOPHER STATE ONE CALL 08/26/2019 112419 9070650 601-49400-489 locates Water 333.45 GOPHER STATE ONE CALL 08/26/2019 112419 9070650 602-49450-489 locates Sewer 333.45 City of Orono Check Register - COUNCIL REPORT Check Issue Dates: 8/13/2019 - 8/26/2019 Page: 6 Aug 22, 2019 10:02AM Payee Check Issue Date Check Number Invoice Number Invoice GL Account Description Department Invoice Amount Total 112419: 666.90 GROUP HEALTH INC 08/26/2019 112420 W816229 101-42110-135 EAP health for 07/2019 Police Department 10.00 Total 112420: 10.00 HENNEPIN COUNTY INFOR TE 08/26/2019 112421 1000134104 101-43000-414 PW Radios 7/19 Public Works Department 195.57 Total 112421: 195.57 HENNEPIN COUNTY SHERIFF 08/26/2019 112422 1000134752 101-41600-309 Jail Charges-Jul/2019 Law/Legal Services 1,781.50 Total 112422: 1,781.50 Henrich, Benjamin 08/26/2019 112423 080919 101-39610 Case 19-005252 Restitution 55.00 Total 112423: 55.00 Innocorp LTD 08/26/2019 112424 M4113 101-42110-580 Fatal Vision Drug Simulation/Goggle Police Department 839.00 Total 112424: 839.00 JANE SZCZEPANIK 08/26/2019 112425 080419 101-42110-226 Investigation Uniforms Police Department 100.17 Total 112425: 100.17 Johnson, Fred 08/26/2019 112426 082119 101-22205 Escrow refund 17-3968 1565 Orchard Beach PI 1,175.00 Total 112426: 1,175.00 JOSH NEEDHAM 08/26/2019 112427 081619 101-42110-402 Auto Repair Reimb Police Department 9.33 Total 112427: 9.33 JR'S ADVANCED RECYCLERS 08/26/2019 112428 98561 603-49500-442 Discarded Items from Ditches 304.00 Total 112428: 304.00 KENNETH N POTTS PA 08/26/2019 112429 080119 231-45650-307 Case 15-008163 2001 MZ Muskito 46.80 City of Orono Check Register - COUNCIL REPORT Check Issue Dates: 8/13/2019 - 8/26/2019 Page: 7 Aug 22, 2019 10:02AM Payee Check Issue Date Check Number Invoice Number Invoice GL Account Description Department Invoice Amount Total 112429: 46.80 LAKESCAPE LLC 08/26/2019 112430 489 101-45200-404 Beach Weed Control Parks 674.68 Total 112430: 674.68 LEAGUE OF MN CITIES INS TR 08/26/2019 112431 5009 703-49960-379 Jetting Sewer Line Claim 2,500.00 Total 112431: 2,500.00 LYNN MYHRAN 08/26/2019 112432 082119 101-22205 Escrow Refund 2017-01115 2280 Fox Street 22,000.00 Total 112432: 22,000.00 MACQUEEN EQUIPMENT 08/26/2019 112433 P21391 701-49800-222 Truck#713 Parts 2,179.71 Total 112433: 2,179.71 MANSFIELD OIL COMPANY 08/26/2019 112434 21400761 101-42110-212 Unleaded Fuel Police Department 3,729.96 MANSFIELD OIL COMPANY 08/26/2019 112434 21400762 701-49800-212 Diesel Fuel 1,105.86 MANSFIELD OIL COMPANY 08/26/2019 112434 21418704 701-49800-212 Diesel Fuel 1,067.48 MANSFIELD OIL COMPANY 08/26/2019 112434 21418708 101-42110-212 Unleaded Fuel Police Department 2,991.99 Total 112434: 8,895.29 MINNEAPOLIS OXYGEN COMPA 08/26/2019 112435 00046107 701-49800-222 Oxygen & Acetylene 30.69 MINNEAPOLIS OXYGEN COMPA 08/26/2019 112435 00046108 101-42110-221 Medical Oxygen Police Department 51.15 MINNEAPOLIS OXYGEN COMPA 08/26/2019 112435 00046109 101-42110-221 Medical Oxygen Police Department 7.13 MINNEAPOLIS OXYGEN COMPA 08/26/2019 112435 01502162 701-49800-222 High Pressure Maintenance Fee 60.00 Total 112435: 148.97 MINNESOTA EQUIPMENT 08/26/2019 112436 P83641 101-45210-226 Hearing Protection Golf Course 32.95 Total 112436: 32.95 Minnesota Secretary of State - No 08/26/2019 112437 081919 101-41300-433 Notary Application A. Carlson Administration 120.00 City of Orono Check Register - COUNCIL REPORT Check Issue Dates: 8/13/2019 - 8/26/2019 Page: 8 Aug 22, 2019 10:02AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount Total 112437: 120.00 MINNETRISTA PUBLIC SAFETY 08/26/2019 112438 082019 101-42110-438 3rd Qtr 2019 Toward Zero Deaths Grant Police Department 744.57 Total 112438: 744.57 MISSION COMMUNICATIONS LL 08/26/2019 112439 1032145 602-49450-403 LS#32 Service Sewer 347.40 Total 112439: 347.40 MN NATIVE LANDSCAPE 08/26/2019 112440 20889 101-45200-404 Saga Hill Herbicide Application Parks 720.00 Total 112440: 720.00 MOUND TRUE VALUE 08/26/2019 112441 162668 101-42110-240 PD Garage Lights Police Department 64.75 Total 112441: 64.75 NAVARRE HARDWARE 08/26/2019 112442 319491 101-43000-226 PPE Gloves Public Works Department 16.46 NAVARRE HARDWARE 08/26/2019 112442 319492 602-49450-227 Battery Sewer 6.49 NAVARRE HARDWARE 08/26/2019 112442 319584 602-49450-227 Battery Sewer 6.49 NAVARRE HARDWARE 08/26/2019 112442 319614 601-49400-322 UPS Water Water 11.41 NAVARRE HARDWARE 08/26/2019 112442 319646 601-49400-405 Irrigation Repair - Watermain Break Task #30555 Water 10.54 Total 112442: 51.39 NEWEGG INC 08/26/2019 112443 1302327574 710-49970-221 Hard Drive - J. Werder - PD 116.98 Total 112443: 116.98 NORTHERN SPECIALITIES INC 08/26/2019 112444 00088591 101-45220-404 Brush Site Gate Operator Brush Site 460.00 Total 112444: 460.00 O SULLIVANS HOLIDAY 546 08/26/2019 112445 073119 101-42110-402 07/19 Car Washes Police Department 99.00 Total 112445: 99.00 0 SULLIVANS HOLIDAY 547 08/26/2019 112446 07312019 101-42110-402 07/19 Car Washes Police Department 216.69 City of Orono Check Register - COUNCIL REPORT Page: 9 Check Issue Dates: 8/13/2019 - 8/26/2019 Aug 22, 2019 10:02AM Department Invoice Amount Police Department 13.67 Central Services 457.25 Police Department 7,256.35 7,256.35 Police Department 1,032.08 Police Department 116.69 254.00 Golf Course Police Department 2,538.98 Check Check Invoice Invoice GL Account Description Payee Issue Date Number Number O SULLIVANS HOLIDAY 547 08/26/2019 112446 07312019 101-42110-240 Outdoor Activities Water Total 112446: OFFICE DEPOT 08/26/2019 112447 3479873920 101-41900-201 Chairmat Total 112447: Plate, Alexander 08/26/2019 112448 080919 101-39610 Case 19-005252 Restitution Total 112448: Quilty, Patrick 08/26/2019 112449 081919 999-10015 UB Refund 1025 Willow View Dr Acct #1-810250-00 Total 112449: RDO EQUIPMENT 08/26/2019 112450 W50128 701-49800-403 Unit #430 Backhoe Repair Task 30173 Total 112450: ROGERS POLICE DEPARTMEN 08/26/2019 112451 082019 101-42110-438 3rd Qtr 2019 Toward Zero Deaths Grant Total 112451: RYAN AUTO MALL 08/26/2019 112452 623465 101-42110-402 Squad #244 Repair RYAN AUTO MALL 08/26/2019 112452 624233 101-42110-402 Squad #253 Repair Total 112452: SAFETY VEHICLE SOLUTIONS 08/26/2019 112453 1847 701-49800-221 Square Work Lights for Trucks SAFETY VEHICLE SOLUTIONS 08/26/2019 112453 1848 701-49800-221 Round Work Lights for Trucks Total 112453: SiteOne Landscape Supply 08/26/2019 112454 93648083-00 101-45210-223 Golf Fungicide Total 112454: SOUTH LAKE MINNETONKA PO 08/26/2019 112455 082019 101-42110-438 3rd Qtr 2019 Toward Zero Deaths Grant Department Invoice Amount Police Department 13.67 Central Services 457.25 Police Department 7,256.35 7,256.35 Police Department 1,032.08 Police Department 116.69 254.00 Golf Course Police Department 2,538.98 City of Orono Check Register - COUNCIL REPORT Check Issue Dates: 8/13/2019 - 8/26/2019 Check Check Invoice Invoice GL Account Description Payee Issue Date Number Number Total 112455: SOUTHVIEW DESIGN 08/26/2019 112456 082119 101-22205 Escrow Refund 2017-01115 2280 Fox Street Total 112456: STONEWOOD LLC 08/26/2019 112457 082219 101-22205 Escrow refund RPS18-000022 1925 Fox St STONEWOOD LLC 08/26/2019 112457 082219 101-39615 Escrow refund RPS18-000022 1925 Fox St Total 112457: STREICHERS POLICE EQUIP 08/26/2019 112458 11378398 101-42110-228 Training Ammo STREICHERS POLICE EQUIP 08/26/2019 112458 11379279 101-42110-226 Pants, Mag Holder STREICHERS POLICE EQUIP 08/26/2019 112458 11379873 101-42110-226 Boots STREICHERS POLICE EQUIP 08/26/2019 112458 11380122 101-42110-226 Shirt Carrier STREICHERS POLICE EQUIP 08/26/2019 112458 11380619 101-42110-226 Shirt Total 112458: SUN LIFE FINANCIAL 08/26/2019 112459 0919LIFE 101-21710 Life Ins-Sept/2019 SUN LIFE FINANCIAL 08/26/2019 112459 0919LIFE 101-15998 Life Ins-Sept/2019 SUN LIFE FINANCIAL 08/26/2019 112459 0919STD 101-21714 STD-Sept/2019 Total 112459: T W TUPY INC 08/26/2019 112460 071319 651-49910-227 Limestone Task 29527 + Yard Stock Total 112460: The Broadway Group LLC 08/26/2019 112461 082119 101-22205 Escrow refund Oliver Hill Total 112461: THE HARTFORD 08/26/2019 112462 082019 101-21713 LTD 9/2019 Total 112462: Truax Patient Services 08/26/2019 112463 3923 101-42110-240 Narcan Nasal Spray Department Police Department Police Department Police Department Police Department Police Department Storm Water Police Department Page: 10 Aug 22, 2019 10:02AM Invoice 2,538.98 1,000.00 1,000.00 1,000.00 30.00- 648.44 96.97 164.99 1,154.38 2,413.50 2,756.59 900.00 City of Orono Check Register - COUNCIL REPORT Page: 11 Check Issue Dates: 8/13/2019 - 8/26/2019 Aug 22, 2019 10:02AM Payee Check Issue Date Check Number Invoice Number Invoice GL Account Description Department Invoice Amount Total 112463: 900.00 TWIN CITY GARAGE DOOR CO 08/26/2019 112464 Z106147 101-41900-404 PW South Garage Door Repair Central Services 2,200.00 Total 112464: 2,200.00 TWIN CITY SEED COMPANY 08/26/2019 112465 45190 651-49910-227 Ditching & Yard Restoration Task 29527 Storm Water 472.50 TWIN CITY SEED COMPANY 08/26/2019 112465 45242 651-49910-227 Storm Water Task 29527 & Inventory Storm Water 916.25 Total 112465: 1,388.75 TWIN CITY STRIPING 08/26/2019 112466 081719 101-43000-408 2019 Road Striping - OCB, Willow, Brown, Kelly Pw Public Works Department 5,000.00 Total 112466: 5,000.00 U.S. AutoForce 08/26/2019 112467 2019067377 101-42110-402 Squad 246 Tires Credit Police Department 52.64 - U.S. AutoForce 08/26/2019 112467 5543374 101-42110-402 Squad Tires Police Department 1,440.00 Total 112467: 1,387.36 UNITED FARMERS COOPERATI 08/26/2019 112468 21-55491 651-49910-227 Sun/Shade Grass Seeds TAsk 29527 Storm Water 72.99 Total 112468: 72.99 VERIZON WIRELESS 08/26/2019 112469 9833525268 101-42110-221 PD Equipment Police Department 149.99 VERIZON WIRELESS 08/26/2019 112469 9835513103 101-42110-321 Internet 8/7/19-9/6/19 Police Department 1,725.55 VERIZON WIRELESS 08/26/2019 112469 9835513103 101-41900-321 Internet 8/7/19-9/6/19 Central Services 136.05 VERIZON WIRELESS 08/26/2019 112469 9835513103 101-42400-321 Internet 8/7/19-9/6/19 Building & Zoning 70.02 VERIZON WIRELESS 08/26/2019 112469 9835513103 101-43000-321 Internet 8/7/19-9/6/19 Public Works Department 140.04 VERIZON WIRELESS 08/26/2019 112469 9835513103 101-45200-321 Internet 8/7/19-9/6/19 Parks 35.01 VERIZON WIRELESS 08/26/2019 112469 9835513103 101-45210-321 Internet 8/7/19-9/6/19 Golf Course 141.89 VERIZON WIRELESS 08/26/2019 112469 9835513103 601-49400-321 Internet 8/7/19-9/6/19 Water 176.90 VERIZON WIRELESS 08/26/2019 112469 9835513103 602-49450-321 Internet 8/7/19-9/6/19 Sewer 35.01 Total 112469: 2,610.46 WAYZATA BAY CAR WASH 08/26/2019 112470 17431 101-42110-402 #261 Car Wash Police Department 10.63 City of Orono Invoice Amount 10.63 Police Department Check Register - COUNCIL REPORT 4,957.90 Police Department 455.00 Check Issue Dates: 8/13/2019 - 8/26/2019 Brush Site Check Check Invoice Invoice GL Account Description Payee Issue Date Number Number Total 112470: WEST HENNEPIN PUBLIC SAFE 08/26/2019 112471 082019 101-42110-438 3rd Qtr 2019 Toward Zero Deaths Grant Total 112471: WILLIAMS TOWING 08/26/2019 112472 150429 101-42110-436 tow case #19003958 Total 112472: Wright -Hennepin Coop Electric 08/26/2019 112473 3502739170 101-45220-381 Brush Site 7/1/19-8/1/19 Wright -Hennepin Coop Electric 08/26/2019 112473 3502739170 101-43000-386 Electical Service 7/1/19-8/1/19 Wright -Hennepin Coop Electric 08/26/2019 112473 3502739170 101-45210-319 GC Security 9/1-9/31/19 Total 112473: Grand Totals: Page: 12 Aug 22, 2019 10:02AM Department Invoice Amount 10.63 Police Department 4,957.90 4,957.90 Police Department 455.00 455.00 Brush Site 21.57 Public Works Department 158.26 Golf Course 40.76 220.59 263,391.29 AGENDA ITEM Item No. 4 Date: August 26, 2019 Item Description: Approval of 2019 Commercial Kennel License Presenter: Anna Carlson, Agenda Consent Agenda City Clerk Section: 1. Purpose. The purpose of this action item is to gain approval for a 2019 Commercial Kennel License. Currently the applicant's business DogHaven is under construction and anticipates opening its doors in early September. The applicant has requested their Commercial Kennel License be approved subject to approval of the Certificate of Occupancy; which is anticipated to be completed prior to the next scheduled regular City Council meeting. 2019 NEW COMMERCIAL KENNEL LICENSE — APPLICANT • DogHaven, LLC Ryan Hasse 3800 Shoreline Drive 2. Staff Recommendation. Staff recommends approval of the 2019 Commercial Kennel License application subject to approval of the Certificate of Occupancy. The License will not be issued until the Certificate of Occupancy has been approved. COUNCIL ACTION REQUESTED Motion to approve the above listed Commercial Kennel license for 2019 subject to approval of Certificate of Occupancy. Prepared By: AMC Reviewed By: AMC Approved By: -Sb AGENDA ITEM Item No.: Date: August 26, 2018 Item Description: Fire Department Door Access Improvement Request Presenter: Dustin Rief Agenda Consent Agenda Section: 1. Purpose: To approve expenditures at the Fire Department outside of budget for 2019 2. Background: On July 22, 2019 the Fire Chief presented options for expenditures for the 2020 budget, which included door access updates at the two fire stations. Staff prioritized this as high priority due to the system no longer being able to be serviced for Station 2 and recommended adding it as an unscheduled expenditure for the 2019 budget. Council gave guidance and agreed. 3. Finances: This will be funded by funds designated for fire equipment in the Improvement Equipment Outlay fund. The City's share is 85.31% or $5295.98 of the $6,207.92 expenditure. 4. Staff Recommendation: City Administrator recommends approval of additional 2019 expenditure for the upgrade of door access for the two fire stations. COUNCIL ACTION REQUESTED Motion to approve Fire Department door access improvement request. Exhibits A. Fire Department Door Access Improvement Request Prepared By: -SbV Reviewed By: -SbV Approved By: -Sb Memo Serving the Communities of Orono, Long Lake and Medina With pride and professionalism TO: Scott Johnson City Administrator of Medina and Dustin Rief City Administrator of Orono From: Fire Chief James Van Eyll cc: Scott Weske, City Administrator of Long Lake Data 08/15/2019 Re: Purchase of new door access system The Long Lake Fire Department has a door code access system at each fire station. They are stand- alone systems without cloud access. Over this past year, the system at Station 2 wouldn't allow us to input new codes. We reviewed the options for fixing the stand-alone system at Station 2 and also upgrading the system. The system is 15 years old and then; are issues with obtaining parts and the software is obsolete. A new system at just Station 2 was going to cost $3,285.59. The new system is an updated keypad system to that building. It didn't have access to the cloud nor was it smart phone enabled. The other issue is that a similar system is installed at Station 1 and it is only a matter of time before this one has the same issue. A new similar system at Station 1 was going to cost $4,655.41. We also researched the ability to control both buildings via cloud -based access with the ability to utilize key FOBs and an app on a smart phone. This system has more functionality and can utilize the same wiring to save on the cost of installation. The price for this system is $6,207.92. Please see attached quote. We would prefer to install this yet this year and this item can be categorized as an "Unforecasted Expenditure" per our contract. We will do what we can to keep our expenditures down for the remaining months this year so as to not go over budget. Please add this to your next City Council Agendas for approval. If you would like me to attend, please email me the date and time of the meeting. If you have any other questions, please feel free to contact me to discuss. Thanks R//J't e6 vdc 6 O James Van Eyll Chief, Long Lake Fire Department Estimate = tNE FtX Ti s BILL TO Long Lake Fire Department 340 Willow Drive N Lang take, MN 55356 The Flying Locksmiths - Minneapolis 750 Boone Ave N Suite 106 Golden Valley, MN 55427 Minneapolis@flyinglocksmiths.com 763-544-5397 JOB SITE Long Lake Fire Department 340 Willow Drive N Long Lake, MN 55356 ESTIMATE # DATE TERMS WORK ORDER P.O. NO. REP #19294 05/29/2019 QUANTITY DESCRIPTION RATE AMOUNT 1.0 Service Call $85.00 $85.00 6.0 Wiring Per Door (Reroute to new destination) $225.00 $1,350.00 6.0 Install Openpath Reader $75.00 $450.00 6.0 Openpath Smart Reader $250.00 $1,500.00 1.0 Network Wiring to 3770 Controller $400.00 $400.00 1.0 Network wiring to 340 Controller $75.00 $75.00 2.0 Install Openpath Controller $75.00 $150.00 2.0 Openpath Smart Hub Door Controller 24V $850.00 $1,700.00 4.0 Battery Backup $24.98 $89.82 2.0 Openpath Key Fob - Qty 50 $199.00 $398.00 Sub Total $6,207.92 Sales Tax 7.525°k $0.00 Payments/Credits - Balance Due - QUANTITY DESCRIPTION RATE AMOUNT Total $6,207.52 TERMS AND CONDITIONS We are excited to get started on designing, procuring, and installing your security solution. This is an estimate only. Closer inspection may reveal the need for replacement hardware and/or more extensive repairs. We will update (and provide to you) the estimate based on the changes that need to be made. This estimate is valid for 30 days. Prices with our distributors change frequently. If you decide to go forward with an estimate that is over 30 days old we will provide you with an updated estimate that reflect the most accurate pricing. AGENDA ITEM Item No.: Date: August 26, 2019 Item Description: Oliver Hill - Formal Acceptance Public Improvements - Resolution Gti Presenter: Adam T. Edwards Agenda Consent Agenda s Public Works Director/City Engineer Section: 1. Purpose. The purpose of this item is for City Council to accept the sanitary sewer utility within the Oliver Hill Development. 2. Background. The Oliver Hill development was approved subject to the terms of the Development Contract and Residential Planned Unit Development Agreement, Oliver Hill, 13-3637 / 14-385, PUD#8 executed by the developer and the City in September of 2014. Per the contract the sanitary sewer utility is to be a public facility owned operated and maintained by the city of Orono. In subsection 24 the agreement states that the final security will be returned to the developer once the public improvements are accepted by the City Council. With the wear course layer of asphalt placed in August the infrastructure terms of the development contract have been met. 3. Public Improvements. The only portion of the development infrastructure that is public is the sanitary sewer system. The system consists of 4 manholes and 369 feet of gravity sewer main. 4. Staff Recommendation. I recommended formal acceptance of the sanitary sewer. COUNCIL ACTION REQUESTED: Adopt the attached resolution accepting the sanitary sewer improvements within Oliver Hill as public facilities. Exhibits A. Resolution B. City Engineer final inspection letter Prepared By: 7E Reviewed By: -SbV Approved By: -TV CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. A RESOLUTION ACCEPTING THE SANITARY SEWER UTILITY WITHIN OLIVER HILL AS PUBLIC FACILITIES WHEREAS, on September 30'h, 2014 the City of Orono and The Broadway Group, LLC entered into Development Contract and Residential Planned Unit Development Agreement, Oliver Hill, 13-3637 / 14-385, PUD#8 (the "Contract") which documented the terms and conditions under which the development known as Oliver Hill was approved; and WHEREAS, the terms and conditions of the Agreement in Subsection 1)(8)(1) state that final acceptance of the improvements to be publicly owned, including, sanitary sewer, shall take the form of a Resolution passed by the Orono City Council, on the advice of the City Engineer; and WHEREAS, the City Engineer has recommended that the City formally accept the Improvements; and NOW, THEREFORE BE IT RESOLVED that the City Council of Orono does hereby formally accept the Public Improvements (Sanitary Sewer Utility) associated with Oliver Hill and shall assume ownership and maintenance of said facilities. Adopted by the City Council of Orono, Minnesota this 26th day of August, 2019. ATTEST: Anna Carlson, City Clerk Denis Walsh, Mayor ttoN� CITY OF ORONO Stmx Addmm M 0in9Addrev: Tew�e hF (952)2694 2250 Kelley Pnkway P.O. Barts Gar 19521249 -WA f 0 Omno, MN 55356 Crystal Bay. MN 55323 o omno m us 7KfSHOa August 12th, 2019 To: Jeremy Barnhart, Community Development Director From: Adam Edwards, City Engineer Subject: Oliver Hill Development Final Inspection 1. The constructionworkassociatodwith the Oliver Hill development is complete. I recommend that the public portion of the project, sanitary sewer, be accepted by the city and that the remaining letter of credit be released. 2. Art Taylor, Bolton and Men$ inspected the final wear course work on August 12a, 2019 and found it metatystandards. 3. The required As- built plan sets were provided in 2017 and the sanitary sewer was inspected by city slaffatthattime. Sincerely, J Adam T. Edwards, P.E. City Engineer/ Director of Public Works City of Orono Item No.: 7 Date: August 26, 2019 Item Description: 2017-18 Sanitary Sewer I&I Grant Resolution Presenter: Adam T. Edwards Agenda Consent Agenda Public Works Director/City Engineer Section: 1. Purpose. The purpose of this action item is to gain Council approval of a resolution to participate in the I&I Grant Program. 2. Background. The State of Minnesota has appropriated funds to the MCES for use in a Municipal I&I reduction grant program. The city of Orono Applied for this grant and was preliminarily allocated $30,618. The grant money will be used to pay for work that was completed as part of the 2017-19 CIPP sewer projects. 3. Requirement. One of the requirements of the program is for the City to pass a resolution authorizing participation in the program. 4. Way Forward. Once approved the resolution along with other grant paperwork will be sent to the MCES. The MCES will provide a grant contract that will be brought back to council for approval prior to receiving any grant funds 5. Staff Recommendation. I recommend that the Council BMIs proposal for design and engineering services. COUNCIL ACTION REQUESTED Motion to adopt a resolution authorizing participation in the MCES Municipal I&I Grant Program. Exhibits A. Resolution Prepared By: Reviewed By: -T)X Approved By: -T9X A RESOLUTION APPROVING PARTICIPATION IN THE 2017 STATE BOND FUNDED MUNICIPAL I&I GRANT PROGRAM WHEREAS, the Minnesota Legislature has appropriated funds to the Metropolitan Council for a grant program to be administered by the Council for the purpose of providing grants to municipalities for capital improvements to public municipal wastewater collection systems to reduce the amount of inflow and infiltration to the Council's metropolitan sanitary sewer disposal system ("I/I Municipal Grant Program"); and WHEREAS, the City of Orono submitted an application for grant funds and the Council identified the City as a contributor of excessive inflow and infiltration to the Council's metropolitan sanitary sewer disposal system and thus an eligible applicant for grant funds of $30,618 under the I/I Municipal Grant Program; NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ORONO that this Council approves participation in the Municipal I&I Grant Program with the Metropolitan Council. ADOPTED by the Orono City Council this _day of ,2019. ATTEST: Anna Carlson, City Clerk Denis Walsh, Mayor AGENDA ITEM �Q� Item No.: 8 Date: August 26, 2019 Item Description: Wayzata Boulevard (CSAH 112) Phase Two Landscaping Design Proposal G 9KEsxo4� Presenter: Adam T. Edwards Agenda Consent Agenda Public Works Director/City Engineer Section: 1. Purpose. The purpose of this item is for City Council to reject the bid received for the CSAH 112 PH2 Landscaping Plan. 2. Background. The cooperative agreement for the CSAH 112 Phase 2 project assigns Orono the task of managing the landscaping project. Long Lake was responsible for the phase 1 landscaping. In March of 2018 the Council authorized SRF Consulting to prepare plans for the landscaping project. Those plans and a bid package were completed. In August 2019 staff solicited bids for the project and received one. The bid is considerably greater than the engineers estimate and the budget for the project. 3. Scope. The landscaping project will be primarily focused around the Old Long Lake CSAH 112 Intersection area as this is where the most vegetative impact is expected. This landscape project does not include the restoration (Grass Seed / Sod) that will be undertaken as part of the main roadway project. 4. Cost. The engineers estimate for construction is $56,986. The City received one bid from Hoffman and McNamara Co for $87,331. 5. Funding. The landscaping project is funded by the phase two turn back budget. The Cooperative agreement budgeted $71,000 for the landscaping project. Design the project for $14,000 leaving $57,000 for construction. 6. Staff Recommendation. I recommend Council reject the bid. 7. Way Forward. Staff will work with SRF to reduce the scope of the project and then solicit quotes for the project. COUNCIL ACTION REQUESTED: Move to reject the bids received for the CSAH 112 Phase 2 Landscaping Project. Prepared By: 7E Reviewed By: -19X Approved By: 11V AGENDA ITEM Item No.: Date: August 26, 2019 Item Description: LA19-000033 — Chuck Alcon o/b/o Eric and Andrea Larson, 690 Brown Road, Final Plat and Development Agreement Approval Presenter: Jeremy Barnhart, Community Agenda Consent Agenda Development Director Section: 1. Purpose. This item is to consider the Final Plat of Willow Bay Sanctuary, a 7 lot subdivision of 690 Brown Road. 2. 15.99 Deadline. Application was received on May 15, 2019. The application was considered complete on August 6`h, 2019. Action must be taken by October 5, 2019. 3. Background/ Summary. The City Council adopted resolution 6989 on May 13, 2019, approving the preliminary plat for Willow Bay Sanctuary, a 7 lot single family residential subdivision. The proposed final plat is consistent with the approved Preliminary Plat. All lots are consistent with the Council direction in terms of lot width and area. The proposed use of the property, single family residential at density of .5 units per acre is consistent with the Comprehensive Plan. The newly developed properties will be served by water and sanitary sewer. A Development Agreement has been prepared by the City Attorney, and has been signed by the applicant, in anticipation of Council Approval. All costs associated with the development, including street/ utility construction, storm water management, erosion control, etc., are the responsibility of the developer. The Development Agreement includes the following provisions: 23 D. The existing lot, currently served by an onsite septic system, will be required to connect to the municipal system the earlier of 1 year from the date the city accepts the system, or if the existing home is demolished, the replacement home is built. 29E. One building permit may be issued on either lot 1 or Lot 7, Block 1, prior to the first lift of asphalt. A Certificate of Occupancy may not be issued until the street has been paved, the utilities accepted, and all drives off of Brown Rd are removed. 4. Staff Recommendation. Staff recommends approval of the Final Plat and authorization of the Developers Agreement as proposed. COUNCIL ACTION REQUESTED Staff Recommendation: Motion to amend or adopt the attached resolution. Authorize Mayors signature of Development Agreement and mylars. Exhibits A. Final Plat Resolution — Draft B. Final Plat C. Development Agreement D. Resolution 6989 Prepared By: J. Barnhart Reviewed By: -SbV Approved By: -Sb CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. A RESOLUTION APPROVING THE PLAT OF WILLOW BAY SANCTUARY - FILE #LA19-000033 WHEREAS, the City of Orono (hereinafter the "City") is a municipal corporation organized and existing under the laws of the State of Minnesota; and WHEREAS, the City Council of the City of Orono (hereinafter "City Council") has adopted subdivision and land development regulations for the orderly, economic and safe development of land within the City; and WHEREAS, on March 16, 2019, Mike Steadman, o/b/o property owners Eric and Andrea Larson (hereinafter the "Owners") submitted an application for approval of a Preliminary Plat for property located at 690 Brown Road in the City of Orono and legally described in Exhibit A (attached); and WHEREAS, at its regular meeting on May 13, 2018 the Orono City Council granted approval for the Preliminary Plat per the findings and conditions of Resolution No. 6989; and WHEREAS, on May 16, 2019 the Owners, through their agent made formal application for final plat approval for the Property; and WHEREAS, the Owners have agreed to comply with all conditions of Resolution No. 6989 and has completed or has agreed to complete all other requirements of the platting regulations of the City including: 1. Completion of all platting requirements and conditions of Preliminary Plat Resolution No. 6989. 2. Dedication on the plat of perimeter Drainage and Utility Easements as required in Resolution No. 6989. 3. Submittal of Minnehaha Creek Watershed District (MCWD) permits approving the grading, stormwater management facilities, Storm Water Pollution Prevention Plan (SWPPP) and erosion control plan. 4. Provision to the City of a title opinion for the Property and certified copies of all recorded easements currently affecting the Property. 5. Execution of a Development Contract including provision of financial security including a Page 1 of 4 CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. Letter of Credit and escrow to ensure that all site improvements are installed and maintained to the City's specifications and satisfaction, and to establish conditions for future development of the site. 6. Payment of development fees as follows: Engineering, City Administration (escrow) $ 4,000.00 Park Dedication Fee 33,300.00 Storm Water and Drainage Trunk Fee 48,360.00 Water Connection Charge 29,680.00 Sewer Connection Charge 36,575.00 Final Plat Fee 500.00 Total Cash Requirements & Fees $152,415.00 WHEREAS, City staff and consultants have reviewed the plans for this subdivision and hereby specify approval of each plan and identify them as part of the official record for Willow Bay Sanctuary, all attached as Exhibit B: Plat of Willow Bay Sanctuary Sheet A: Signature Page Sheet B: Lots 1-3 Sheet C: Lots 4-7 Construction Drawings Sheet 1: Title Sheet (dated 7-10-19) Sheet 2: Existing Conditions (dated 7-10-19) Sheet 3: Grading Plan (dated 7-10-19) Sheet 4: Street Plan & Profile (dated 7-10-19) Sheet 5: Utility Plan and Profile (dated 7-10-19) Sheet 6: Erosion Control and SWPPP (dated 7-10-19) Sheet 7: Detail Sheet (dated 7-10-19) Sheet 7: Detail Sheet (dated 7-10-19) Sheet 9: Detail Sheet (dated 7-10-19) All of the above noted plans are subject to any additional requirements of the Minnehaha Creek Watershed District and the City Engineer. Page 2 of 4 CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. NOW, THEREFORE, BE IT RESOLVED that based on the findings of Resolution No. 6989, the City Council of the City of Orono does hereby approve the plat of WILLOW BAY SANCTUARY, Hennepin County, Minnesota (a copy of which is attached as Exhibit B) subject to the following conditions: Development within WILLOW BAY SANCTUARY is subject to the Conclusions, Orders and Conditions enumerated within Preliminary Plat Resolution No 6989, and subject to the provisions of the Development Contract for WILLOW BAY SANCTUARY dated August 12, 2019. 2. Upon completion by the Developer of the public water and sanitary sewer improvements as shown on the Construction Drawings (sheets 1-7) within WILLOW BAY SANCTUARY, subject to final certification by the City Engineer that the work is satisfactory, the City will formally accept the utilities as public, and the City will maintain said facilities henceforth. 3. The approvals granted in this Resolution shall become effective only when all conditions of approval requiring actions by the Developer have been satisfied. 4. The City Clerk shall release the plat documents for filing only upon certification by the City Attorney, Community Development Director and City Engineer that all requirements of the platting regulations have been satisfied. 5. The aforesaid plat shall be filed by the City of Orono with Hennepin County on or before February 12, 2019 together with a certified original copy of this resolution and executed copies of the easements and covenants pertinent thereto. The approval granted by this Resolution shall expire if the conditions of this Resolution have not been met or the plat has not been filed by the date specified above. In that event, it will be necessary to file a new application with the City of Orono for subdivision review. Adopted by the City Council of Orono this 26th day of August, 2019. ATTEST: Anna Carlson, City Clerk Dennis Walsh, Mayor Page 3 of 4 CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. Exhibit A That part of Government Lot 1, Section 34, Township 118 North, Range 23 West of the 5th Principal Meridian, which lies North of a line drawn East at right angles to the West line of said Government Lot 1, from a point thereon distant 1170.70 feet South along said West line from the Northwest corner of said Government Lot 1; northwesterly of the shoreline of Long Lake; and southerly and southwesterly of the southerly and southwesterly lines of Registered Land Survey No. 1275; EXCEPT That part of said Government Lot 1 described as follows: Beginning at a point on the West line of said Government Lot 1 a distance of 133.00 feet South from the Northwest corner of said Government Lot 1, (also being the Southwest corner of said Registered Land Survey No. 1275); thence continuing South along said West line 458.70 feet; thence East at right angles 344.14 feet; thence North at right angles to the southerly line of said Registered Land Survey No. 1275; thence westerly along said southerly line to the point of beginning. 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N � z Z l� / N 0 C3 LU // / N M � r �_ O .� rr o Ir z "' M� -NZ LLJD Luw � amQ) i ami � 0 p_73°37,52 6p p0 o / 1-64 26 R= � \ z O O z �o.s �/ o� �0 E J co 0LU LU 00 �0LU z M r mo 00s� — s Cf) 1\ 06,16 LU FM0co >= LLI oohs cn Z \ LV \ F— U V �clo. 0 cn a °M C o \ II o V N 1 L II Q0 W W N m I -ui 00 X23 M 8 �o'Z� °�' Z I� o,sf°s1 s o M O O NLO z o /- k-00- 0 ['t,6 \ £L'8£ C) [9•t£ Uri C' OL'9zz \ Z o ALU o St' C S Q r u5 V�G£o00 J \\ W z w J I I N CSL � I;-►� LO m o� %zw to �I I4c � SII �N oo / �Q/ / I� N 0 O: / � W, p i co 0 U)I / rr� j' z I -� /� /Opp / 49, h �C-D o 00 89'£V OD i LO (y) M „1£,95.00 S r I CO " I J O I O I O / M / rI po o j p / 0 o / a M / =a a I zv O I r J O I m cv I z CD L — OJ -- — — -- — — — — — W J 66'zz£ M „5t,,££o00 N VJ W W r= cn co U- 0 co W W CI) DEVELOPMENT CONTRACT (Developer Installed Improvements) WILLOW BAYSANCTUARY ZONING FILE # LAI 9-000033 THIS DEVELOPMENT CONTRACT ("Contract" or "Agreement") dated 2019, is by and between WILLOW BAY SANCTUARY, LLC, a Minnesota limited liability company ("Developer" or "Owner") and the CITY OF ORONO, a Minnesota municipal corporation ("City"). 1. REQUEST FOR PLAT APPROVAL. The Developer has asked the City to approve a plat for "WILLOW BAY SANCTUARY" (referred to in this Contract as the "Plat"). The land to be subdivided by the Plat (the "Land") is situated in the City of Orono, County of Hennepin, State of Minnesota, and is legally described on the attached Exhibit A. 2. CONDITIONS OF PLAT APPROVAL. The City hereby approves the Plat on condition that the Developer enter into this Contract and furnish the security required by it. The City will cause the Plat to be duly recorded in the office of the County Recorder in and for Hennepin 202141v4 County, Minnesota, promptly after compliance by the Developer with all conditions precedent to such recording pursuant to this Contract, which conditions precedent the Developer shall cause to be satisfied within 180 days after the City Council approves the final Plat. 3. RIGHT TO PROCEED. Within the Land, the Developer may not grade or otherwise disturb the earth, remove trees, construct sewer lines, water lines, streets, utilities, public or private improvements, or any buildings until all the following conditions have been satisfied: 1) this Contract has been fully executed by both parties and filed with the City Clerk, 2) the necessary "security" (defined below) has been received by the City, and 3) the Plat has been duly recorded in the office of said Recorder. 4. PHASED DEVELOPMENT. N/A 5. PRELIMINARY PLAT STATUS. N/A 6. CHANGES IN OFFICIAL CONTROLS. For two (2) years from the date of this Contract, no amendment to the City's Comprehensive Plan, or official controls shall apply to or affect the use, development density, lot size, lot layout or dedications of the Land unless required by state or federal law or agreed to in writing by the City and the Developer. Thereafter, notwithstanding anything in this Contract to the contrary, to the full extent permitted by state law, the City may require compliance with any amendments to the City's Comprehensive Plan, official controls, platting or dedication requirements enacted after the date of this Contract with respect to property which did not receive final plat approval prior to any such amendment. 7. DEVELOPMENT PLANS. The Land shall be developed in accordance with the following plans (collectively, the "Plans"). The Plans shall not be attached to this Contract. The erosion control plan may also be approved by Minnehaha Creek Watershed District. If the Plans vary from the terms of this Contract, the terms of this Contract shall control. The Plans are: 2 202141v4 Plan A — Plat of Willow Bay Sanctuary Plan B - Grading and Erosion Control Plan Plan C — Site Plan Plan D — Street and Storm Sewer Plan Plan E — SWPPP Plan Plan F — Conservation Design Report and Master Plan Plan G — Landscaping Plan Plan H — Utility Plan 8. IMPROVEMENTS. The Developer shall install and pay for the following as required to be built in accordance with the approved Plans (the "Improvements"): A. Roads B. Site Grading and Erosion Control B. Setting of Iron Monuments C. Surveying and Staking D. Stormwater Management Facilities E. Water and Sewer Utilities The Improvements shall be installed in accordance with the City subdivision ordinance; City standard specifications for utilities and street construction; and any other ordinances including those concerning erosion and drainage and any prohibiting grading, construction activity, and the use of power equipment. The Developer shall submit plans and specifications which have been prepared by a competent registered professional engineer to the City for approval by the City Engineer. The Developer shall instruct its engineer to provide adequate field inspection personnel to assure an acceptable level of quality control. In addition, the City may, at the City's discretion and at the Developer's expense, have one or more City inspectors and a soil engineer inspect the work as the City may reasonably determine. The Developer, its contractors and subcontractors, shall follow all 3 202141v4 instructions received from the City's inspectors. The Developer's engineer shall provide for on-site project management. The Developer's engineer is responsible for design changes and contract administration between the Developer and the Developer's contractor. The Developer or its engineer shall schedule a pre -construction meeting at a mutually agreeable time at the City Council chambers with all parties concerned, including the City staff, to review the program for the construction work. Within thirty (30) days after the completion of the Improvements and before the "security" is released, the Developer shall supply the City with a complete set of reproducible "as constructed" Plans, and an electronic file of the "as constructed" Plans in an Auto CAD file or file format approved by the City Engineer based upon the Hennepin County coordinate system, all prepared in accordance with City standards. 9. IRON MONUMENTS. In accordance with Minnesota Statutes Section 505.021 and the Orono City Code, the final placement of iron monuments for all lot corners must be completed before the "security" is released. The Developer's surveyor shall submit a written notice to the City certifying that the monuments have been installed. 10. PERMITS. The Developer shall obtain or require its contractors and subcontractors to obtain all necessary permits, including but not limited to the following to the extent required: • DNR for Dewatering • City of Orono for Building Permits • Minnehaha Creek Watershed District for erosion control permit and storm water management permit • NPDES Permits (National Pollutant Discharge Elimination System) issued by MPCA 11. DEWATERING. Due to the variable nature of groundwater levels and stormwater flows, it will be the Developer's and the Developer's contractors' and subcontractors' responsibility to satisfy themselves with regard to the elevation of groundwater in the area and 4 202141v4 the level of effort needed to perform dewatering and storm flow routing operations. All dewatering shall be in accordance with all applicable county, state, and federal rules and regulations. DNR regulations regarding appropriations permits shall also be strictly followed. 12. TIME OF PERFORMANCE. The Developer shall install all Improvements as contemplated by Section 8 and the approved Plans by December 31, 2020, with the exception of the final wear course of asphalt on private drive. 13. LICENSE. The Developer hereby grants the City, its agents, employees, officers and contractors a license to enter the Land to perform all work and inspections deemed appropriate by the City in conjunction with development of the Land. 14. EROSION CONTROL. Prior to initiating site grading, the storm water pollution prevention plan, and the erosion control plan shall be implemented by the Developer and inspected and approved by the City. The City may impose additional erosion control requirements if reasonably required. All areas disturbed by excavation and backfilling operations shall be reseeded within five (5) days after the completion of the work, weather permitting, or in an area that is inactive for more than ten (10) days unless authorized and approved by the City Engineer. Except as otherwise provided in the erosion control plan, seed shall be in accordance with the City's current seeding specification which may include certified oat seed to provide a temporary ground cover as rapidly as possible. All seeded areas shall be fertilized, mulched, and disc anchored as necessary for seed retention. The parties recognize that time is of the essence in controlling erosion. If the Developer does not comply with the erosion control plan and schedule or supplementary instructions received from the City, the City may take such action as it deems appropriate to control erosion. The City will endeavor to notify the Developer in advance of any proposed action, but failure of the City to do so will not affect the Developer's and City's rights or obligations hereunder. 5 202141v4 If the Developer does not reimburse the City for any cost the City incurred for such work within ten (10) days, the City may draw down the "security" to pay any costs. No development, utility or street construction will be allowed and no building permits will be issued unless the Land is in full compliance with the approved erosion control plan. 15. GRADING PLAN. Building permits shall be based on the approved grading and erosion control plan, though actual grading will be completed by the property owners at the time of building construction. This approved grading plan will establish the Engineered Grade for the project, as defined by city code. The City will withhold issuance of building permits until all erosion control measures are in place as determined by the City Engineer. The Developer certifies to the City that all lots with house footings placed on fill will have been monitored and constructed to meet or exceed FHA/HUD 79G specifications. 16. CLEAN UP. The Developer shall clean dirt and debris from streets that has resulted from construction work by the Developer, builders, subcontractors, their agents or assigns. Prior to any construction on the Land, the Developer shall comply with all recommendations of the City staff and City Engineer regarding site cleanup and restoration, including but not limited to contaminated soil removal, junk and debris removal, etc. Also, prior to any construction on the Land, the Developer shall identify in writing a responsible party and schedule for erosion control, street cleaning, and street sweeping. 17. CONSTRUCTION AND MAINTENANCE OF IMPROVEMENTS. Upon completion of the Improvements, the City shall inspect the Improvements and notify Developer if any of the Improvements do not conform to the requirements of this Contract. 18. CITY ENGINEERING ADMINISTRATION AND CONSTRUCTION OBSERVATION. The Developer shall pay a fee for engineering administration. City engineering 6 202141v4 administration will include monitoring of construction observation, consultation with Developer and its engineer on status or problems regarding the project, coordination for final inspection and acceptance, project monitoring during the warranty period, and processing of requests for reduction in the "security." Fees for this service shall be at standard hourly rates. These fees shall be billed monthly. Contemporaneously with the execution of this Agreement, the Developer shall deposit $4,000.00 cash with the City ("Escrow"). All accrued interest, if any, shall be paid to the City to reimburse the City for its cost in administering the escrow account. The purpose of the Escrow is to guarantee reimbursement to the City for all out-of-pocket costs (including, but not limited to, planning, engineering oversight, or legal consultant review) the City has incurred or will incur related to the Development and for all out-of-pocket costs the City has incurred or will incur to assure that the work is completed in accordance with the Stormwater Pollution Prevention Plan and the provisions of Orono City Code Chapter 79. The Escrow may also be used by the City to eliminate any hazardous conditions associated with the work and to repair any damage to public property or infrastructure that is caused by the work associated with this Agreement, if compliance with the terms of this Agreement are not accomplished. As the City receives consultant bills for incurred costs, the City will in turn send a bill to the Developer. The Developer shall be responsible for payment to the City within 30 days of the Developer's receipt of bill. In the event that the Developer does not make payment to the City within the timeframe outlined in this Section, the City may immediately draw from the escrow account without further approval of the Developer to reimburse the City for eligible expenses the City has incurred. If the balance of the escrow account is insufficient to reimburse the City its costs under this Section, the Developer will promptly reimburse the City any additional costs. If the eligible expenses incurred 7 202141v4 by the City exceed the amount in escrow and are not promptly reimbursed by the Developer, the City shall have the right to certify the unpaid balance to the subject property pursuant to Minn. Stat. §§ 415.01 and 366.012. The Balance on deposit in the escrow, if any, shall be returned to the Developer when the Development has been completed and written notification is received from the Developer requesting the funds. 19. STORM WATER AND DRAINAGE TRUNK FEE. The Land is subject to the standard Storm Water and Drainage Trunk Fee for new 2 -acre lots at $8,060.00 per lot. $8,060.00 per lot x 6 lots = $48,360.00 20. PARK DEDICATION FEE. The Land is subject to the standard Park Dedication Fee requirement at the following rate: $5,550.00 per lot x 6 new lots = $33,300.00 21. SEWER CONNECTION CHARGE. The Land is subject to the standard Sewer Connection Charge at the following rate: $ 5,225.00 per lot x 7 lots = $36,575.00 The Land is subject to the Metropolitan Council SAC Charge at the following rate: $ 2,485.00 per dwelling unit x 7 dwelling units = $17,395.00 22. WATER CONNECTION CHARGE. The Land is subject to the standard Water Connection Charge at the following rate: $ 4,240.00 per dwelling unit x 7 dwelling units = $29,680.00 23. SPECIAL PROVISIONS. The following special provisions shall apply to development of the Land: A. Implementation of and adherence to the findings and conditions listed in (1) Resolution No. approving the Final Plat for Willow Bay Sanctuary, adopted by the Orono City Council on , 2019; (2) Resolution No. 6989 approving the Preliminary Plat for Willow Bay Sanctuary, adopted by the Orono City Council on May 13, 2019. 8 202141v4 B. Final Plat approval is subject to Minnehaha Creek Watershed District ("MCWD") approval and permits as required. The City will not approve the Plat until the MCWD has approved the stormwater management plans and the Developer has provided evidence that all required MCWD permits have been obtained. C. The Plat shall adhere to the purpose and intent of the Orono Community Management Plan, as amended. D. The existing residential structure on Lot 6, Block 1, shall connect to the sanitary sewer system within 12 months of the city's acceptance of the system. In the event the principal structure is removed, a replacement residential structure shall connect to the sanitary sewer system immediately. E. All of the proposed lots must contain suitable area meeting all established setback requirements to allow the construction of single family residences. F. Prior to City Council approval of the final Plat, the Developer shall furnish a boundary survey of the Land in a form acceptable to City staff. G. The Developer shall pay to the city engineer the amounts incurred for City base map upgrading. H. The Developer shall submit the final Plat in electronic format. The electronic format shall be Auto CAD file or format acceptable to the City Engineer. The Developer shall also submit two complete sets of the Plat on Mylar (one copy for the City's records and one copy for recording with Hennepin County). The Developer shall also provide one copy reduced to 1" = 200'. I. The Developer shall execute and record a Tree Preservation Easement/Covenants over the Land, consistent with the Preliminary Plat. 9 202141v4 24. SUMMARY OF SECURITY REQUIREMENTS. To guarantee compliance with the terms of this Contract, payment of the costs of all Improvements and construction of all Improvements, the Developer shall furnish the City with a letter of credit, in the form attached hereto (the "security"), from a bank for 150% of the cost of the Improvements, including any required landscaping. The following is a summary of the security requirements due under this Contract, which must be in place at the time of silt fence inspection and prior to any other site improvements. Improvements Total Security x 150% $703,972.00 1.055.958.00 The bank shall be subject to the approval of the City Administrator. The City may draw down the security, upon five (5) business days' prior written notice to Developer, for any violation of the terms of this Contract. Amounts drawn shall not exceed the amounts necessary to cure the default. If the Improvements are not completed at least thirty (30) days prior to the expiration of the security, the City may also draw it down. If the security is drawn down, the proceeds shall be used to cure the default. Upon receipt of proof satisfactory to the City that work has been completed and financial obligations to the City have been satisfied, with City approval the security may be reduced from time to time by ninety percent (90%) of the financial obligations that have been satisfied. Ten percent (10%) of the amounts certified by the Developer's engineer, and approved by City's Engineer, shall be retained as security until all Improvements have been completed, all financial obligations to the City satisfied, the required "as constructed" Plans have been received by the City, a warranty security is provided, and the public Improvements are accepted by the City Council. The City standard specifications for utilities and street construction outline procedures for security reductions. 10 202141v4 25. SUMMARY OF CASH REQUIREMENTS AND FEES. The following is a summary of the cash requirements and fees due under this Contract, which must be paid in cash at the time of final plat approval and execution of this Contract by the City: Engineering, City Administration (escrow) $ 4,000.00 Park Dedication Fee 33,300.00 Storm Water and Drainage Trunk Fee 48,360.00 Water Connection Charge 29,680.00 Sewer Connection Charge 36,575.00 Final Plat Fee 500.00 Total Cash Requirements & Fees $152,415.00 26. WARRANTY. The Developer warrants all Improvements against poor material and faulty workmanship. The warranty period for streets is one year. The warranty period for underground utilities is two years and shall commence following completion and acceptance by the City Council. The one year warranty period on streets shall commence after the final wear course has been installed and accepted by the City Council as documented in official City minutes. The Developer shall post a maintenance bond, letter of credit or cash deposit (the "Maintenance Security") in an amount reasonably determined by the City Engineer. The City Engineer shall examine the condition of the Improvements when determining the amount of the Maintenance Security. The City shall retain ten percent (10%) of the security until the Maintenance Security is furnished the City or until the warranty period expires, whichever first occurs. The retainage may be used to pay for warranty work. The City standard specifications for utilities and street construction identify the procedures for final acceptance of streets and utilities. 27. RESPONSIBILITY FOR COSTS. A. Except as otherwise specified herein, the Developer shall pay all costs incurred by it or the City in conjunction with the development of the Land, including but not limited to Hennepin County Environmental Services and Minnehaha Creek Watershed District charges, 11 202141v4 legal, planning, engineering and inspection expenses incurred in connection with approval and acceptance of the Plat, the preparation of this Contract, review of construction plans and documents, and all costs and expenses incurred by the City in monitoring and inspecting development of the Land. B. The Developer shall hold the City and its officers, employees, and agents harmless from claims made by itself and third parties for damages sustained or costs incurred resulting from Plat approval and development of the Land. The Developer shall indemnify the City and its officers, employees, and agents for all costs, damages, or expenses which the City may pay or incur in consequence of such claims, including attorneys' fees. C. The Developer shall reimburse the City for reasonable costs incurred in the enforcement of this Contract, including engineering and attorneys' fees. D. The Developer shall pay, or cause to be paid when due, and in any event before any penalty is attached, all special assessments referred to in this Contract. This is an obligation of the Developer and shall continue in full force and effect even if the Developer sells one or more lots, the Land, or any part of it. E. The Developer shall pay in full all bills submitted to it by the City for obligations incurred under this Contract within thirty (30) days after receipt. If the bills are not paid on time, the City may halt development and construction of the Land until the bills are paid in full. Bills not paid within thirty (30) days shall accrue interest at the rate of eight percent (8%) per year. F. In addition to the charges and special assessments referred to herein, other charges as required by City ordinance or via other agencies for which City acts as agent may be imposed such as, but not limited to, building permit fees. 12 202141v4 28. DEVELOPER'S DEFAULT. In the event of default by the Developer as to any of the work to be performed by it hereunder, the City may, at its option, perform the work and the Developer shall promptly reimburse the City for any expense incurred by the City, provided the Developer, except in an emergency as determined by the City, is first given notice of the work in default, not less than forty-eight (48) hours in advance. This Contract is a license for the City to act, and it shall not be necessary for the City to seek a Court order for permission to enter the Land. When the City does any such work, the City may, in addition to its other remedies, assess the cost in whole or in part against any portion of the Land owned by the Developer or any successor in interest to the Developer. 29. MISCELLANEOUS. A. The Developer represents to the City that the Plat complies with all city, county, state, and federal laws and regulations, including but not limited to: subdivision ordinances, zoning ordinances, and environmental regulations. If the City determines that the Plat does not comply, the City may, at its option, refuse to allow construction or development work on the Land until the Developer does comply. Upon the City's demand, the Developer shall cease work until there is compliance. Contract. B. Third parties shall have no recourse against the City or Developer under this C. Breach of the terms of this Contract by the Developer shall be grounds for denial of building permits, including those for lots sold to third parties. D. If any portion, section, subsection, sentence, clause, paragraph, or phrase of this Contract is for any reason held invalid, such decision shall not affect the validity of the remaining portions of this Contract. 13 202141v4 E. If building permits are issued prior to the completion of all Improvements, the Developer assumes all liability and costs resulting in delays in completion of Improvements and damage to Improvements caused by the City, Developer, its contractors, subcontractors, material men, employees, agents, or third parties. No one may occupy a building for which a building permit is issued on either a temporary or permanent basis until the streets needed for access have been paved with at least one lift of bituminous surface and the utilities are accepted by the City Engineer in writing. Notwithstanding the foregoing, the City may issue one building permit for a principal structure for either Lot 1 or Lot 7, Block 1. A Certificate of Occupancy for that lot will not be granted until the street within the development has been paved with at least one lift of bituminous surface, the utilities are accepted by the City Engineer in writing, and all drives off of Brown Road have been removed. F. The action or inaction of the City shall not constitute a waiver or amendment to the provisions of this Contract. To be binding, amendments or waivers shall be in writing, signed by the parties and approved by written resolution of the City Council. The City's failure to promptly take legal action to enforce this Contract shall not be a waiver or release. G. This Contract shall run with the Land and may be recorded against the Land. The Developer covenants with the City, its successors and assigns, that the Developer is well seized in fee title of the Land and/or has obtained consents to this Contract, in the form attached hereto, from all parties who have an interest in the Land; that there are no unrecorded interests in the Land; and that the Developer will indemnify and hold the City harmless for any breach of the foregoing covenants. H. Each right, power or remedy herein conferred upon the City is cumulative and in addition to every other right, power or remedy, express or implied, now or hereafter arising, 14 202141v4 available to the City, at law or in equity, or under any other agreement, and each and every right, power and remedy herein set forth or otherwise so existing may be exercised from time to time as often and in such order as may be deemed expedient by the City and shall not be a waiver of the right to exercise at any time thereafter any other right, power or remedy. I. The Developer may not assign this Contract without the written permission of the City Council. The Developer's obligations hereunder shall continue in full force and effect even if the Developer sells one or more lots in the Plat, the Land, or any part of it. Upon request, the City shall provide, in recordable form, a release of any lot in the Plat from this Development Contract if the City determines that the terms and conditions of this Contract have been satisfied. J. Developer shall be responsible for all snow removal from vacant lots to the extent that City Ordinance requires snow removal. Developer shall be responsible for ensuring that all vacant lots comply with the City's Code regarding nuisances. K. Retaining walls that require a building permit shall be constructed in accordance with plans and specifications prepared by a structural or geotechnical engineer licensed by the State of Minnesota. Following construction, a certification signed by the design engineer shall be filed with the City Engineer evidencing that the retaining wall was constructed in accordance with the approved plans and specifications. All retaining walls required to be constructed by the Plans, or special conditions referred to in this Contract, shall be constructed before any Certificate of Occupancy is issued for a lot on which a retaining wall is required to be built. L. Developer shall take out and maintain or cause to be taken out and maintained until six (6) months after the City has accepted the public improvements, commercial general liability and property damage insurance covering personal injury, including death, and 15 202141v4 claims for property damage which may arise out of Developer's work or the work of its subcontractors or by one directly or indirectly employed by any of them. Limits for bodily injury and death shall be not less than $500,000 for one person and $1,000,000 for each occurrence; limits for property damage shall be not less than $200,000 for each occurrence; or a combination single limit policy of $1,000,000 or more. The City shall be named as an additional insured on the policy on a primary and noncontributory basis, and the Developer shall file with the City a certificate evidencing coverage prior to the City signing the plat. The certificate shall provide that the City must be given ten (10) days advance written notice of the cancellation of the insurance. 30. NOTICES. Required notices to the Developer shall be in writing, and shall be either hand delivered to the Developer, its employees or agents, or mailed to the Developer by certified mail at the following addresses: Willow Bay Sanctuary, LLC, Attention: S. Andrea Larson, 690 Brown Road N, Orono, MN. 55356, and Eric Larson, 983 Nine Mile Cove East, Hopkins, MN. 55343. After October 1, 2019, notices to be mailed to the 690 Brown Road address shall be mailed to 1925 Lakeside Trail, Orono, MN due to the address change as part of the subdivision. Notices to the City shall be in writing and shall be either hand delivered to the City Administrator, or mailed to the City by certified mail in care of the City Administrator at the following address: Orono City Hall, 2750 Kelley Parkway, Orono, Minnesota 55356. Either party may change the address to which notices to such party thereafter shall be given, by providing to the other party notice of such change. [Remainder of Page Intentionally Left Blank.] 16 202141v4 CITY: CITY OF ORONO wo (SEAL) STATE OF MINNESOTA ) ( ss. COUNTY OF HENNEPIN ) Dennis Walsh, Mayor Anna Carlson, City Clerk The foregoing instrument was acknowledged before me this day of , 2019 by Dennis Walsh and by Anna Carlson, respectively the Mayor and City Clerk of the City of Orono, a Minnesota municipal corporation, on behalf of the corporation and pursuant to the authority granted by its City Council. Notary Public 17 202141v4 DEVELOPER/OWNER: WILLOW BAY SANCTUARY, LLC And STATE OF MINNESOTA ) ( ss. COUNTY OF HENNEPIN ) [print name] Its [title] Its title] name] The foregoing instrument was acknowledged before me this day of , 2019, by and , respectively, the and of Willow Bay Sanctuary, LLC, a Minnesota limited liability company, on behalf of the entity. Notary Public DRAFTED BY: CAMPBELL KNUTSON Professional Association Grand Oak Office Center I 860 Blue Gentian Road, Suite 290 Eagan, MN 55121 Telephone: (651) 452-5000 ABS 18 20214lv4 EXHIBIT A Outlot A, Willow Bay Sanctuary, Hennepin County, Minnesota. Lots 1, 2, 3, 4, 5, 6, 7, Block 1, Willow Bay Sanctuary, Hennepin County, Minnesota. 19 202141v4 MORTGAGE HOLDER CONSENT AND SUBORDINATION TO DEVELOPMENT CONTRACT BRIDGEWATER BANK, a Minnesota banking corporation, the holder of a mortgage dated August , 2019, filed for record with the Hennepin County Recorder of Deeds on 2019, as Document No. , hereby consents to the recording of the attached Development Contract for Willow Bay Sanctuary and agrees that its rights in the property affected by the Development Contract shall be subordinated thereto, and that the Development Contract shall remain in full force and effect even if it forecloses on its mortgage. IN WITNESS WHEREOF, Bridgewater Bank, a Minnesota banking corporation, has caused this Consent and Subordination to be executed this day of , 2019. BRIDGEWATER BANK a Minnesota banking corporation [print name] Its [title] STATE OF MINNESOTA ) )ss. COUNTY OF ) The foregoing instrument was acknowledged before me this 2019, by , the Bank, a Minnesota banking corporation, on behalf of the entity. Notary Public DRAFTED BY: CAMPBELL KNUTsoN Professional Association Grand Oak Office Center I 860 Blue Gentian Road, Suite 290 Eagan, Minnesota 55121 651-452-5000 ABS 20 20214lv4 day of of Bridgewater IRREVOCABLE LETTER OF CREDIT No. _ Date: TO: City of Orono 2750 Kelley Parkway Orono, Minnesota 55356 Dear Sir or Madam: We hereby issue, for the account of and in your favor, our Irrevocable Letter of Credit in the amount of $ available to you by your draft drawn on sight on the undersigned bank. The draft must: a) Bear the clause, "Drawn under Letter of Credit No. , dated 12 of Name of Bank, b) Be accompanied by an affidavit signed by the Mayor or City Administrator of the City of Orono certifying that is in default of the Development Contract with the City of Orono and that five (5) business days prior written notice has been given by the City to the Developer with respect to the existence of such default, and such default has not been cured. c) Be presented for payment at (Address of Bank), on or before 4:00 p.m. on November 30, 2 This Letter of Credit shall automatically renew for successive one-year terms unless, at least forty-five (45) days prior to the next annual renewal date (which shall be November 30 of each year), the Bank delivers written notice to the Orono City Administrator that it intends to modify the terms of, or cancel, this Letter of Credit. Written notice is effective if sent by certified mail, postage prepaid, and deposited in the U.S. Mail, at least forty-five (45) days prior to the next annual renewal date addressed as follows: Orono City Administrator, Orono City Hall, 2750 Kelley Parkway, Orono, Minnesota 55356, and is actually received by the City Administrator at least thirty (30) days prior to the renewal date. This Letter of Credit sets forth in full our understanding which shall not in any way be modified, amended, amplified, or limited by reference to any document, instrument, or agreement, whether or not referred to herein. This Letter of Credit is not assignable. This is not a Notation Letter of Credit. More than one draw may be made under this Letter of Credit. This Letter of Credit shall be governed by the most recent revision of the Uniform Customs and Practice for Documentary Credits, International Chamber of Commerce Publication No. 600. This agreement shall be construed and interpreted under Minnesota Law. We hereby agree that a draft drawn under and in compliance with this Letter of Credit shall be duly honored upon presentation. IBM Its 21 202141v4 CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 6989 A RESOLUTION APPROVING A PRELIMINARY PLAT FOR WILLOW BAY SANTUCARY FILE NO. LA19-000022 WHEREAS, on March 16, 2019, Eric Larson and Andrea Larson, unmarried persons ("Applicant[s]"), applied for a preliminary plat for the property legally described in Exhibit A, (hereinafter the "Property"); WHEREAS, on April 15, 2019, after published and mailed notice in accordance with Minnesota Statutes and the City Code, the Planning Commission held a public hearing, at which time all persons desiring to be heard concerning this application were given the opportunity to speak thereon; and WHEREAS, on April 15, 2019, the Planning Commission recommended approval of the preliminary plat; and WHEREAS, on May 13, 2019, the City Council reviewed the application and the recommendations of the Planning Commission and City staff; and NOW, THEREFORE, BE IT RESOLVED that the City Council of Orono, Minnesota hereby approves the requested preliminary plat as described above based on one or more of the following findings of fact concerning the Property: FINDINGS OF FACT: 1. This application was reviewed as Zoning File #LA19-000022. The analysis contained within staff memos and the exhibits attached to the aforesaid memos, all minutes from the above mentioned meetings, and any and all other materials distributed at these meetings are hereby incorporated by reference. 2. The Property is located in the LR-lA Zoning District. 3. The property is guided for Low Density Residential in the 2030 Community Management Plan and in the draft 2040 Comprehensive Plan. CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 6989 4. The Property contains 23.72 acres in area and has a defined lot width of over 564 feet on Long Lake and over 580 feet of frontage on Brown Road. 5. The property will be served by municipal sanitary sewer and water. 6. The Property is within Tier 1 and hardcover is limited to 25% according to the Stormwater Quality Overlay District. 7. The parcel will be subdivided into 7 buildable lots and platted right of way. All lots conform to the size and width requirements of the city code. 8. The Developer has prepared grading plans to manage stormwater on site without negatively impacting adjacent parcels. 9. Access to the property is via the existing Brown Road North, a public street. 10. The Parks, Trails and Open Space element of the Orono Community Management Plan (CMP) has no current plans for parks that specifically require dedication of park land from this property. 11. The developer has submitted a Conservation Design Report and Master Plan prepared by Kjohlaug Environmental Services Company dated March 28, 2019 that inventories and describes in detail the environmental features of the site, defining what natural values of the site should be preserved or enhanced and how that should occur. CONCLUSIONS, ORDER AND CONDITIONS: Based upon one or more of the above findings, the Orono City Council hereby grants preliminary plat approval to allow the subdivision of the property into 7 lots, as depicted on the plans dated April 3, 2019 prepared by Gronberg and Associates, attached as Exhibit B, subject to the following conditions: A. Project Specific Conditions 1. The applicable general engineering comments and or conditions provided by City Engineer dated April 8, 2018 attached hereto as Exhibit C shall be suitably addressed by applicant in the development plan submittal. CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 6 9_8 9 2. Easements shall be provided as required by the City Engineer. 3. Significant trees shall be preserved to the extent possible and as shown on the landscaping plans. 4. Upon evidence of pre -settlement history, the developer will contact the city and the State Historical Preservation Office prior to proceeding. 5. The following estimated fees are due at the time of final plat unless otherwise noted. These fees are based on the 2019 Fee schedule and the fee schedule in effect at the time of Final Plat approval will govern. a. Stormwater and Drainage Trunk: The property will be subject to the Stormwater and Drainage Trunk Fee (SW&DT Fee) of $48,420.00 (Number of new lots (6) times per lot amount ($8,060). b. Sewer: The costs to construct the Sewer system within the site will be the developers responsibility. The Metropolitan Council SAC charge which is currently $2,485 per dwelling unit will be due at the time of building permit for each lot. The City's sewer charge is $5,225.00 per lot, or $36,575.00. c. Water: The costs to construct the water system will be the developers responsibility. The City's water charge is $29,680.00 ($4,240 per dwelling unit). d. Park dedication: $33,300 ($5,550 x 6 new lots). B. General conditions imposed on preliminary plats shall apply, and are as follow: 1. Appropriate traffic control signage within and pertinent to the site shall be installed by the Developer subject to the City Engineer's review and approval. 2. Applicant shall demonstrate to the satisfaction of the City Council that all requirements of the Minnehaha Creek Watershed District as administrator of the WCA regulations on Orono's behalf, are complied with. 3. Erosion control shall adhere to "Best Management Practices for Protecting Water Quality in Urban Areas" and to the approved SWPPP. All erosion controls as 3 CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 6989 required by the City and the MCWD shall be in place prior to commencing grading and excavation on the site. All such erosion control measures shall be maintained in working order until the site is vegetated and stabilized. 4. The construction limits shall be clearly marked with adequate fencing to prevent any construction damage or disturbance of any trees and vegetation outside of the construction limits area. Developer shall identify trees to be preserved on site, shall mark them on a site plan, and shall take extraordinary measures such as fencing, signage, etc. to ensure they are not disturbed. 5. This approval is based upon the known issues that may affect this project, but this approval does not limit the City from revising or amending these conditions as the review process continues. 6. Council approval is based on the entire record, above Findings. 7. Any amendments to the plans which are not in conformity with City codes may require further Planning Commission and City Council review. 8. Authorities granted by this resolution run with the Property not with the Applicants, but are permissive only and must be exercised by filing a final Plat application within one year of the date of Council approval, or the preliminary plat will expire on that date (May 13, 2020). 9. Violation of or non-compliance with any of the terms and conditions of this resolution may result in the termination of any authority granted herein. C. Plans and Specifications. The following plans and specifications shall be submitted for review and approval by the City and other appropriate jurisdictions: 1) Final plans and specifications for all proposed utility lines and services, including any proposed revisions to existing service facilities. Proposed plans shall be provided to the City for final review and approval with the Final Plan set. The Public Works Department and any other pertinent reviewing agencies shall review and approve all utility improvements. Final sanitary sewer and watermain plans shall be provided and are subject to approval by the Public Works Department and City Engineer. 2) Final Street and Storm Sewer Plans. CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 6989 3) Final Grading, Drainage and Erosion Control Plan and SWPPP showing existing and proposed contours, building locations, elevations, stormwater facilities and calculations, utilities and erosion control measures to be used during construction. General Development Plan Approval will not be granted until the Minnehaha Creek Watershed District has approved the stormwater plans. 4) Landscaping plan to reflect a more natural pattern of replacement trees, versus a lineal replacement pattern along the new road. 5) Any additional plans and specifications deemed necessary by the City as review progresses. D. Platting Process. Applicant shall complete all requirements for Final Plat Approval as follows. The following list of final submittals must be submitted to the City Administrator 2 weeks prior to the regularly scheduled Council meeting on the second Mondays of the month. These submittals are as follows: 1). Record plat drawings in the form of two (3) mylar copies (one copy for the City's records and one for filing with Hennepin County) and one (1) copy reduced to 1" _ 200'. Drawing to include: A. Lot lines platted per preliminary plat survey/drawing by Gronberg and Associates dated April 3, 2019 attached hereto as Exhibit B, except as modified herein. B. Dedication of "drainage and utility easements" 10' along exterior property lines and 5' along the interior property lines. C. Dedication of "Drainage Easements" over all drainageways. D. Name of plat. 2). Legal documents required: A. Title opinion addressed to the City or a title insurance policy in favor of the City. All owners, mortgage holders or others with property interest indicated therein shall sign the plat and all other documents affected by such interest. CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. -6-9 8 9 B. The applicant must provide certified copies of all recorded easements currently affecting the property. C. Signed Developers Agreement and Letter of Credit for construction of improvements. The City Engineer shall establish the amount to be provided in the Letter of Credit. D. One original copy of any private covenant, homeowners' association agreement or other private restriction intended to be filed in the chain of title of the property at the time the final plat or survey is recorded. 3). Fees required: Application fee, Park dedication, Stormwater and Drainage Trunk enumerated above. E. Development Agreement. Development Approval is contingent upon the successful execution of a Development Agreement between the applicant and the City. Such Agreement shall address all specific City requirements for the development. F. Financial Guarantee. The Development Agreement shall include a financial guarantee by the applicant to ensure the completion of site improvements. The City Engineer shall complete an estimate of improvement costs, including but not limited to streets, curb & gutter, sanitary sewers, landscaping, grading, erosion control, utilities, and stormwater management facility construction, and the applicant shall provide to the City a financial guarantee of 150% of the improvement costs. ADOPTED by the Orono City Council on this 13th day of May, 2019. AT 1'E, T: Anna Carlson, City Clerk 6 CITY OF ORONO: Dermis Walsh, Mayor CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 6989 Exhibit A Legal Description Parcel 1: That part of Government Lot 1, Section 34, Township 118, Range 23, described as follows: Commencing at a point 799 feet east and 133 feet south of the Northwest corner of said Lot 1; thence West 799 feet to west line of said Lot 1; thence South 1037.7 feet; thence at right angles east to the shore of Long Lake; thence northeasterly along lake -shore to a point which bears South 54 degrees 20 minutes East from the point of beginning; thence North 54 degrees 20 minutes West 1017 feet, more or less to the point of beginning, according to the United States Government Survey thereof, except that part of said tract described as follows: Commencing at the northwest corner of the Northwest Quarter of the Northeast Quarter of said Section 34; thence southerly along the westerly line thereof a distance of 133 feet to the point of actual beginning; thence southerly along said westerly line a distance of 598.70 feet; thence deflect 90 degrees 00 minutes to the left a distance of 344.14 feet; thence deflect 90 degrees 00 minutes to the left a distance of 572.95 feet; to the southerly line of R. L. S. No. 1275; thence westerly along said line a distance of 345.10 feet to the point of beginning. Parcel 2: That part of the Northwest Quarter of the Northeast Quarter of Section 34, Township 118 North, Range 23 West described as follows: Commencing at the northwest corner of said Northwest Quarter of the Northeast Quarter; thence southerly along the westerly line thereof a distance of 591.70 feet to the actual point of beginning of land to be described; thence continuing southerly along said westerly line a distance of 140.00 feet; thence deflect to the left 90 degrees 00 minutes a distance of 344.14 feet; thence deflect to the left 90 degrees 00 minutes a distance of 140.00 feet; thence deflect to the left 90 degrees 00 minutes a distance of 344.14 feet to the point of beginning, Hennepin County, Minnesota. CITY OF ORONO RESOLUTION OF THE CITY COUNCIL y� NO. 69 8 9 SHO Exhibit B Preliminary Plat • WILLOW BAY SANCTUARY TITLE PAGE VICINITY SKETCH TABLE OF CONTENTS 1. TITLE PAGE 2. PRELIMINARY PLAT 3. EXISTING CONDITIONS 4. PRELIMINARY GRADING PLAN 5 PRELIMINARY EROSION CONTROL AND SWPPP PLAN 6. PRELIMINARY ROAD PLAN AND PROFILE 7. PRELIMINARY UTILITY PLAN L' zw Lu Q g Y 000 c/)>Z Q p W � K So W w O m�J Zz3 0°'i WILLOW BAY SANCTUARY PRELIMINARY PLAT r r'Lls, scHUTz_ ypoT. M M L S S7'41'E 453. 3�� 9t, \ `� \ \ � t / �" I � / . �•� I �� \� / \ JI I 541+ AC '2015t,el 41 I 416-AC//O /O� • t'���L�7. � d! �_�a�a++'+�•J �� ��/` � d.k I I'se fig,. -� ��I �////ill/lµ11 ��.,/��% �, ✓/ �j �� /meq/Fr l � �'v � -� � E(3+ Af5- - AGS A x.01 '\ I IZ511�a. Ns N O r K l / a ri ��/F/ri 1,i4ii��� q�II �'Lp'4ry YN`GN pMEN �K� / Pa � 1171�t�t l%ill 0 100 200 400 f•r.r.I.u. �� I SCALE IN FEET TREE PROTECTION AREA ma LEGAL DESCRIPTION OF PREMISES Parcel 1'. Thal id of Gevemment Lo11, S-11 34 TI—hp 118 Range 23described es Al.—. Commencrtg ala pont 199 feete d1331etsauthoflhe Northweslcornelpf sad Lot 1' thence Well 799 feet t, west III f ildid L t 1' thS— 1031.1 feet, thence n ht an les east to the shore of Lan Lak 9 U M t k h 1 'nt wtt c�be20 South 54 degrees 20 mnueeE Ifr M p l lig 9g', Ih N,the tlegre 20 t West 10111eet more 1 th pont fd Un tetl Slat G menl Survey Mereol, ptM Ip RIf dg t0 1b d gt Ilth C111 111119 It the Mwesl corner of Ne N Rh Iq ode of the N h tQ R "Ted Seclo 34 N therly along the west dyl thee,f d' 1 f133feet t the po,,t of ,t,.l peg P g, —I S,Ohedy along lid —Dirly I- III f 598 ]D feet, N ce deflect 90 de,,le, 00 m -notes to Ue eft a d f 344.14 feet, th tl A t 90 degrees DO m n N fl d hence of 512.95 feet theh ly I R. L S. N 1215 thence waste y g -tl ne a tlstance 1134510feel t Di p t fb g g Parcel 2'. 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Purpose. The applicant is requesting variances for hardcover, buildings, and retaining walls in the 75' lakeyard, average lakeshore setback, side yard setback and lot area; as well as an IUP- Alteration over 50 cubic yards of material within the 75' lakeshore setback to construct a new home. 2. Background. This is a unique property in that an inlet from Lake Minnetonka encroaches into the lot, establishing an additional 75 lake yard into the lot. The applicant is proposing to build a new home, replacing the existing structure. The existing home sits forward of the 75' lakeyard setback for Lake Minnetonka and the inlet. The applicant proposes the new home further back from Lake Minnetonka and the inlet but still within the 75' lakeshore. The proposal includes the removal of hardcover on the west side of the property and turn this space into a usable lawn area. To minimize the inlet encroachment, the applicant proposes to move the home closer to the east side property line, into the east side yard setback. The proposal decreases overall hardcover but includes new hardcover for a patio within the 75' lakeyard. Due to the existing home being located in the 75' lakeyard an interim use permit is required for movement of earth over 50 cubic yards in the lakeyard. To remove the existing home and create a lawn space as well as construct the new home, new grading will new done within the lake yard. 3. 15.99 Deadline. A complete application was made August 8, 2019. The 60 -day review period expires on October 7, 2019 4. Planning Commission Vote and Comment. The planning commission reviewed the application and discussed the home with the proposed setbacks and decreased hardcover at their meeting on August 19, 2019. The commission unanimously recommended approval of the requested variances and IUP. 5. Public Comment The abutting neighbor provided an email of support for the project. (Exhibit D) Staff Recommendation. Planning Staff recommends approval of the proposed variances and interim use permit via the attached resolution. . COUNCIL ACTION REQUESTED The Council is asked to approve or amend the proposed approval resolution. Exhibits A. Draft Resolution B. Proposed Survey and Plans C. Annotated Survey D. Neighbors Submitted Comments E. Planning Commission Staff Report References PC Exhibits Exhibit A. Application Exhibit B. Practical Difficulties Documentation Form Prepared By: LLO Reviewed By: J. Barnhart Approved By 11 2 Exhibit C. Proposed Survey Exhibit D. Proposed Plans and Elevations Exhibit E. Submitted Hardcover Calculations Exhibit F. Narrative Exhibit G. Neighbor's Comments Exhibit K Annotated Survey Exhibit L Property Owners List and Map CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. A RESOLUTION APPROVING A VARIANCE FROM MUNICIPAL ZONING CODE SECTION 78-305, 78-1279, 78-1680, 78-1726 FILE NO. LA19-000049 WHEREAS, on August 7, 2019, Peter Eskuche ("Applicant"), applied for a variance from the City Code for the property addressed 2605 North Shore Drive and legally described as: Legal Description of Property: (per Certificate of Title No. 1168419) That part of Government Lot 4, Section 9, Township 117, Range 23, described as follows: Commencing at the North quarter corner of said section; thence on a bearing of South (the North line of the Northeast Quarter of said section being assumed to have a bearing of North 88 degrees 51 minutes West for purposes of this description) a distance of 2878.55 feet; thence South 70 degrees 37 minutes 31 seconds East a distance of 838.42 feet; thence South 67 degrees 19 minutes 23 seconds East a distance of 266.25 feet to Point A, said point A being the point of beginning of the property being described and also the beginning of line A; thence South 32 degrees 16 minutes 30 seconds West along said line A to a point on the shore of Lake Minnetonka, and said Line A there ending; thence Southeasterly along said shore to a point 300 feet Southeasterly from said Line A, said 300 feet being measured on a bearing of South 59 degrees 05 minutes 30 seconds East from said line A; thence North 32 degrees 16 minutes 30 seconds East a distance of 370 feet to an intersection with a line drawn South 59 degrees 05 minutes 30 seconds East from said Point A; thence North 59 degrees 05 minutes 30 seconds West to said Point A, the point of beginning; except that part of said above described property lying Southeasterly of the following described line: Commencing at said Point A; thence South 59 degrees 05 minutes 30 seconds East a distance of 246.74 feet to the point of beginning of the line being described; thence South 34 degrees 54 minutes 30 seconds West to the shore of Lake Minnetonka, and said there ending. (hereinafter the "Property"); WHEREAS, the Applicants have made application to the City of Orono for a variance to Orono Municipal Zoning Code Section78-305 to allow lot area and a 19 foot side yard setback; and WHEREAS, the Applicants have made application to the City of Orono for a variance to Orono Municipal Zoning Code Section 78-1279 to allow average lakeshore setback for retaining walls which exceed 42 inches in the 75 foot lakeshore; and CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. WHEREAS, the Applicants have made application to the City of Orono for a variance to Orono Municipal Zoning Code Section 78-1279 to allow building and retaining walls in the 75 foot lakeshore; and WHEREAS, the Applicants have made application to the City of Orono for a variance to Orono Municipal Zoning Code Section 78-1680 to allow for hardcover in the 75 foot lakeshore; and WHEREAS, the Applicants have made application to the City of Orono for an interim use permit to Orono Municipal Zoning Code Section 78-1726 to allow movement of over 50 cubic yards of material within the lakeyard; and WHEREAS, on August 19, 2019, after published and mailed notice in accordance with Minnesota Statutes and the City Code, the Planning Commission held a public hearing, at which time all persons desiring to be heard concerning this application were given the opportunity to speak thereon; and WHEREAS, on August 19, 2019, the Planning Commission recommended approval of the variance and IUP; and WHEREAS, on August 26, 2019, the City Council reviewed the application and the recommendations of the Planning Commission and City staff; and NOW, THEREFORE, BE IT RESOLVED that the City Council of Orono, Minnesota hereby approves the requested variances as described above based on one or more of the following findings of fact concerning the Property: FINDINGS OF FACT: 1. This application was reviewed as Zoning File #LA19-000049. The analysis contained within staff memos and the exhibits attached to the aforesaid memos, all minutes from the above mentioned meetings, and any and all other materials distributed at these meetings are hereby incorporated by reference. 2. The Property is located in the LR -1A Zoning District. 3. The Property contains 1.86 acres in area and has a defined lot width of 230 feet. 4. The Property is within Tier 1 and hardcover is limited to 25 % according to the Stormwater Quality Overlay District. CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 5. Applicant has applied for the following variances and interim use permit: a. Lot area and side yard setback (78-305) b. Average lakeshore setback, building and retaining walls in the lakeyard (78-1279) c. Hardcover in the lakeyard (78-1680) d. Movement of over 50 cubic yards of material within the lakeyard (78-1726) 6. In considering this application for variance, the Council has considered the advice and recommendation of the Planning Commission and the effect of the proposed variance upon the health, safety and welfare of the community, existing and anticipated traffic conditions, light and air, danger of fire, risk to the public safety, and the effect on values of property in the surrounding area. VARANCE ANALYSIS: 1. "Variances shall only be permitted when they are in harmony with the general purposes and intent of the ordinance ...." The proposed variances are in harmony with the intent and purpose of the Ordinance. The goal of the ordinance sis to reduce or eliminate improvements in the lake yard, the proposal shifts away from the lake yard as much as practical. 2. "Variances shall only be permitted . . . when the variances are consistent with the comprehensive plan." . The proposed variances to develop a nonconforming lot of record are consistent with the comprehensive plan. 3. The applicant establishes that there are practical difficulties. a. The property owner proposes to use the property in a reasonable manner not permitted by the official controls; The request to permit construction of the home on the substandard lot, in the proposed location within the lake, and side yard setbacks, appears to be reasonable as the property's reduced size and orientation with respect to the lakeshore. The hardcover and retaining walls proposed within the lake yard appear to be reasonable. b. There are circumstances unique to the property not created by the landowner; The lake and its inlet limit the building envelope for the property. The surrounding lakeshore is unique property feature of the lane and c. The variance will not alter the essential character of the locality. The variances are requested in order to permit construction of a home designed to fit the character of the neighborhood according to the submitted information. 4. Economic considerations alone do not constitute practical difficulties. Economic considerations have not been a factor in the variance approval determination. 5. Practical difficulties also include but are not limited to inadequate access to direct sunlight for solar energy systems. Variances shall be granted for earth -sheltered construction as defined in Minn. Stat. § 216C.06, subd. 2, when in harmony with Orono City Code Chapter 78. This condition is not applicable. CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 6. The board or the council may not permit as a variance any use that is not permitted under Orono City Code Chapter 78 for property in the zone where the affected person's land is located. This condition is not applicable, as the use for a single family home is an allowed use in the LR -1A District. 7. The board or council may permit as a variance the temporary use of a one -family dwelling as a two-family dwelling. This condition is not applicable. 8. The special conditions applying to the structure or land in question are peculiar to such property or immediately adjoining property. The property's substandard size and orientation with respect to the lakeshore creates difficulties which may also apply to properties in the same neighborhood. 9. The conditions do not apply generally to other land or structures in the district in which the land is located. The property's substandard size and orientation with respect to the lakeshore creates difficulties which may also apply to properties in the same neighborhood. However, the location of the lake surrounding the building envelop is very unique to this property. 10. The granting of the application is necessary for the preservation and enjoyment of a substantial property right of the applicant. Granting a lot area, side yard and lake setback variances are necessary for the preservation of the property right of the application. The retaining walls in the lakeyard and average lakeshore setback, hardcover for the patio variances facilitate the use of the property for the new home and are necessary for the preservation of the property. 11. The granting of the proposed variance will not in any way impair health, safety, comfort or morals, or in any other respect be contrary to the intent of this chapter. Granting the requested variances in this unique situation is not contrary to the intent of the zoning chapter. 12. The granting of such variance will not merely serve as a convenience to the applicant, but is necessary to alleviate demonstrable difficulty. The variances do not merely serve as a convenience to the applicant. The variances are necessary as the property has considerable practical difficulties affecting development. INTERIM USE ANALYSIS: 1) The use will meet the general performance standards in section 78-916 of this chapter; The grading will conform to the standards within Section 78-916 of the Zoning Code. 2) The use is allowed as an interim use in the applicable zoning district; grading of materials are permitted within the LR -1A zoning district; this statement is true. 3) The use will not delay anticipated development or redevelopment of the site; the proposed grading activity will be conducted in conjunction with the development of the new single family home on the property. This statement is true. CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 4) The use will not be in conflict with any provisions of the city code on an ongoing basis; the proposed grading activity will not be in conflict with the Code 5) The use will not adversely affect the adjacent property, the surrounding neighborhood, or other uses on the property where the use will be located; The result of the proposed grading will not change the intended residential use of the Property so there should be no change in the use and enjoyment of adjacent properties resulting from the lakeshore grading. The grading work on the Property as well as the forthcoming construction of the proposed home could result in additional noise, dust, vibration and traffic on the haul routes and immediate neighbors. To the degree possible, negative impacts should be limited and mitigated 6) The use will not impose additional unreasonable costs on the public; the lakeshore grading should not impact any public roadways. 7) The date or event that will terminate the use can be identified with certainty; the conclusion of the grading activity will coincide with the finalization of the construction of the proposed home on the property. An as -built survey shall be submitted to confirm conformance with the approved grading plan at the closing of the permits. 8) And the applicant agrees in writing to any conditions that the city council deems appropriate for the use, including a requirement for a financial security to ensure removal of all evidence of the use upon termination, and restoration of the site to prior or better conditions. The conditions shall be set forth in a development agreement between the property owner and the city, which agreement shall be recorded with the Hennepin County Recorder or Registrar of Deeds. The conditions of approval will be documented as required. CONCLUSIONS, ORDER AND CONDITIONS: Based upon one or more of the above findings, the Orono City Council hereby grants a variance to Orono Municipal Zoning Code Section 78-305, 78-1279, 78-1680 and 78-1276 to allow variances for lot area, side yard setback, average lakeshore setback, building retaining walls and hardcover within the 75 foot lakeyard and an interim use permit for movement over 50 cubic yards within the lake yard to construct a new single family home, subject to the following conditions: 1. Council approval is based on the entire record, above Findings. 2. The approved project shall conform to the survey dated 8/6/2019 and plans submitted by the Applicants and annotated by City staff, attached to this Resolution as Exhibit A. CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 3. Any amendments to the plans which are not in conformity with City codes may require further Planning Commission and City Council review. 4. Authorities granted by this resolution run with the Property not with the Applicants, but are permissive only and must be exercised by obtaining a building permit for the new construction and commencing construction of said project. A framing inspection must be completed within one year of the date of Council approval, or the variance will expire on that date (August 26, 2020). 5. Violation of or non-compliance with any of the terms and conditions of this resolution may result in the termination of any authority granted herein. ADOPTED by the Orono City Council on this day of 20 ATTEST: CITY OF ORONO: Anna Carlson, City Clerk Dennis Walsh, Mayor / -7H -7H 10 \ M 0 r I s N -4110 / v Q� Mo _�% • / U \ U `%.31 / 01 / . Un c0 7 O! 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ITEMS IN RED ARE TO BE REMOVED FOUND V v "SAT NE CORNER OF SEC. 9-117-23; cf)N FOUND 00 o-4 0 00 oCA EAST CRYSTAL BAY :OOTPRINT LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 \Sep �,9 I w Gv SUMMER SOLSTICE SUNRISE --_ SUMMER SOLSTICE SUNRISE i F- k - WINTER SOLSTICE WINTER SOLSTICE SUNRISE SUNRISE P 5�=� m 0 P�E�m 9� SITE CONFORMING eSKUCHe DESIGN GROUP Copyright 2019 OW a qr W.4a a .05 WIL °1lI�-fie V #2655 9L 9LI + Y P 16 - *Y �' 1 .'7 '96` - 0 ovi ftr f0' RIGHT-OF-WAY LINES AS SHOWN ON R.L.S. NO. 1467 00 — %,4b ***. **% *% R 'J OIL s o \,dicial Landmark 69' p p set pursuant to ` O NO ` Order in Case No. 6- ` 27 -ET -CV -15-61 /vO R F S h' R A 19799) Q , (931.3) \ IN BIA MH i� \ s3 `� C/CT O •`� \ ^ ` PROgO ^o \ \ \ **4%b` 7 \ \\ \\ `%4%b LINEA ------X32---------- CO 064 top \ \ •p„ \ •\ \ PILLFyt; \ \ , \ 2 .\. C ( \\�RO0C_�T9Y\ \\ % NE 18"X60" 42" TALL ENTRY o< IN MONUMEN (M) 0 1 64 POND \ \ > \\ \ \ (FRENCH CREEK) \ \ \69 ♦ Py EDGE OF WETLAND \ \� `\` \ \ \ ♦♦♦♦ ���� AS DELINEATED BY �e \ \ \ \ ♦♦ QQ� - ANDERSON ENGINEERING \ \ Q OF MN (TYP) \ \ \ \ ♦�� WETLAND STAKE PER d0j3 ............ 4 \ \ \ ENGINEERING o � "'--• - ANDERSON - -F = I N(TYP)EN �♦ 0 "!-or , �♦ ,> s�� Jr -41b'R 5 :>% - „ - ` 7 x(931.6) , �. R LA , - --------934-------------- ------------ -'' GON PAD E 7p„.R 10" Cf,2A�APPLE -- qd ' ' SPRUCE r �Ccc� , : -= (L) 12 sPRu qoA� 12OPOSED 15r � RING �ap� AL�BPwR_s WIDE ASPHAL sela�'mac _ CONCRETE I " _ (935.6) W - • DRIVEW ;rn il- � BRIDGE _-�----- ----------------'---- --- _ - OOD (0)736- /\(0> ♦�' F – e BORDER / /\1/ ♦ 7r : � (TYP)M6F PP / ♦, 193691 a 9 - jw (KI PROPOSED GAME LAWN 938.0 [''1 Jt /'' V / PROPOSED• P I VER MOTORC RT E„ I N G —i.� - Judicial Landmark �� u E et pursuant to / / ISTING 439,6" Order in Case No.I Ur / ACKTOP DRI WA R -- \ 27 -ET -CV 15-61 - \ = AVIN DRIVEWAY REMOVE �c X38 - ------ EXISTING FLAGPOLE J �o� G FOUNTAIN CPQ o �� \ (C)cb 0 (15 /93�3J \ �M'�' ?. # / UCAS O O� 01 GOA / �� 5 3GE5 12" p!„� �POSED 12" � ;�� R,p S I ENC � 37855) 9 \ Rqp WI[LOIy. \ ,SURVE (H) �� Y Q SEN1L 103 1 J CD 9 R 0 ITEMS IN RED ARE TO BE REMOVED �� 93 R'DGE (I WOOD sgs \11 Q� o�/' �� .1Y oF01,�_ BORDER �2�,, y� 9l \ (off (TYP) 't,� FLOOR �0 932 (9327) h, '. K (F....,. (Pt l ` FLOOR LEVEL= (93j \ P PD (940.1) s� _ TERRA E 935 ' S �7 �3p \ D �l \ \ SSS (B) 929.4 CONTOUR \ y`(P)\\ LINE (O.H.W.) \\'`• \ a (N.G.V.D.1929) \ 93 `\ \,• (F) CO NC RETE WALK LAKE MINNETONKA EAST CRYSTAL BAY AVERAGE LAKESHORE SETBACK BASED ON ADJACENT HOMES IN 0 1�) ig a u1� ,I LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 SUMMER SOLSTICE SUNRISE O SUMMER SOLSTICE SUNRISE O �Y k - WINTER SOLSTICE WINTER SOLSTICE SUNRISE -- - SUNRISE P M� 4 ;I f0' RIGHT-OF-WAY LINES AS SHOWN ON R.L.S. NO. 1467 00 — %,4b ***. **% *% R 'J OIL s o \,dicial Landmark 69' p p set pursuant to ` O NO ` Order in Case No. 6- ` 27 -ET -CV -15-61 /vO R F S h' R A 19799) Q , (931.3) \ IN BIA MH i� \ s3 `� C/CT O •`� \ ^ ` PROgO ^o \ \ \ **4%b` 7 \ \\ \\ `%4%b LINEA ------X32---------- CO 064 top \ \ •p„ \ •\ \ PILLFyt; \ \ , \ 2 .\. 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R LA , - --------934-------------- ------------ -'' GON PAD E 7p„.R 10" Cf,2A�APPLE -- qd ' ' SPRUCE r �Ccc� , : -= (L) 12 sPRu qoA� 12OPOSED 15r � RING �ap� AL�BPwR_s WIDE ASPHAL sela�'mac _ CONCRETE I " _ (935.6) W - • DRIVEW ;rn il- � BRIDGE _-�----- ----------------'---- --- _ - OOD (0)736- /\(0> ♦�' F – e BORDER / /\1/ ♦ 7r : � (TYP)M6F PP / ♦, 193691 a 9 - jw (KI PROPOSED GAME LAWN 938.0 [''1 Jt /'' V / PROPOSED• P I VER MOTORC RT E„ I N G —i.� - Judicial Landmark �� u E et pursuant to / / ISTING 439,6" Order in Case No.I Ur / ACKTOP DRI WA R -- \ 27 -ET -CV 15-61 - \ = AVIN DRIVEWAY REMOVE �c X38 - ------ EXISTING FLAGPOLE J �o� G FOUNTAIN CPQ o �� \ (C)cb 0 (15 /93�3J \ �M'�' ?. # / UCAS O O� 01 GOA / �� 5 3GE5 12" p!„� �POSED 12" � ;�� R,p S I ENC � 37855) 9 \ Rqp WI[LOIy. \ ,SURVE (H) �� Y Q SEN1L 103 1 J CD 9 R 0 ITEMS IN RED ARE TO BE REMOVED �� 93 R'DGE (I WOOD sgs \11 Q� o�/' �� .1Y oF01,�_ BORDER �2�,, y� 9l \ (off (TYP) 't,� FLOOR �0 932 (9327) h, '. K (F....,. (Pt l ` FLOOR LEVEL= (93j \ P PD (940.1) s� _ TERRA E 935 ' S �7 �3p \ D �l \ \ SSS (B) 929.4 CONTOUR \ y`(P)\\ LINE (O.H.W.) \\'`• \ a (N.G.V.D.1929) \ 93 `\ \,• (F) CO NC RETE WALK LAKE MINNETONKA EAST CRYSTAL BAY AVERAGE LAKESHORE SETBACK BASED ON ADJACENT HOMES IN 0 1�) ig a u1� ,I LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 SUMMER SOLSTICE SUNRISE --_ SUMMER SOLSTICE SUNRISE k - WINTER SOLSTICE WINTER SOLSTICE SUNRISE -- - SUNRISE 0 ZO 40 60 SITE PLAN W/ADJACENT HOMES eSKucHe DESIGN GROU P Copyright 2019 EXISTING HOUSE UNDER CONSTRUCTION #2655 M S,�o3�31„� 838 42 �0 0 (30 V,.r 1 ¢off o^ Oo J M S 6)0 7923„F S) 2662S PO/NTA IN GOVT LOT 4, SEC. 9-117-23 HENNEPIN COUNTY, MINNESOTA RIGHT-OF-WAY LINES AS SHOWN ON R.L.S. NO. 1467 10 OX32`----_ --------- R t9 o udicial Landmark 3` 690 • `` set pursuant OS, Order in Casee No. Nb �0 O 00 f. ` y0 •� (929.9) `�` O • �A V (931.3) SAN \ MH IN, OkT°p R ° \ \\ �� A�wAy�� LINE A \ \ Co PILLF IN, \ %4% ` PI A ` \ Oc �,Qy \ \ / NE 18” X 60” \ \ �0 Q��F '\ \ \ ENTRY LL O°�c V 9�c�9 V A r VIN 28" WILLOW MONUMEN (M) O POND (FRENCH CREEK) \ \ O \ \ \ V A , +_Ow / (D) S� EDGE OF WETLAND AS DELINEATED BY ANDERSON ENGINEERING \ \ OFMIN (TYP) \\ \\ /40 40 WETLAND STAKE PER 3° � ����������a* Goo ANDERSON ENGINEERING ��®�!10 � do to OF MN (TYP) ♦ toodo ,�- ------ 93� i� o \ \ j / / ' Vit' 4<Y wKtow ____ 1 + CON E 7p„ aN` N ; - \ 934 � GEN PAD %r 1.6) d - -: - ce �ftq 162 RRlf��i i Gn LE (L) rz sPRu 9�aAz sPzucE OPOSED 15 rn // 10",CftP , �, \ CONCRETE BRIDGE\\\ 1,4'`:ASH ��� '' (935.6) WALL$P&TARS WIDE ASPHA • DRIVEWAY'J— \ / u BORDER �� /^i (o) Imo` PROPOS�M GARDEN r el WALLS APPkOX. 18" TALL (TYP) .J 2_ /;; g36. LCH PATH ,C:5/ STONE PADS EC T gFG� lxl�STING HARDCOj/ER [Aq / g3 PROPOSED GAME LAWN 938.0' 935.4) Judicial Landmark 4u /s3 PROPOSED RAVER MOTORC RT EMS I N G ISTING 93a.6 931 0 et ursuant to / / ( -) Order in Case No. / ACKTOP D RI WA R \\7 -ET -CV -15-61 �z DRIVEWAY v 1 AVI N - �e a ', 3 / (D) 61, �s '� REMOVE 10,689 sq ft j �(� --- ------- FLAGPOLE �Jg3g-____ EXISTING F �o� G FOUNTAIN O (C) �1,' ,. (P) ooh o��� m (9 .8) ° �(y� (93 \ / S _.(0) O�� GOA ` U -.J I /\ 6 POSED SI ENCr�<q�0 37.5) 9 v`q //'��� '� WILLOW \ SURVE ( (N) X98£ % (�A SE�%T �� "J 7 g3 % r \\ OOO BRIOG INE ,QO % ,ROOFO CLEAi�If ;'�., \ g wooD Sg`S \ ` 9 c/F i LL .6 �FRNano L CK \ `� BORDER �� V rED,WAY e° \ J (TYP) ,'�,,�\OOO CRq /93 So FLOOR 00 S� of QeJO�, 32.7) yLq�- K � 10.> (F) (P_ � WgCC � ` FLOOR A374 .g -i ��_ A - �O�� LEVEL= 4� C (N) REMOVE ALL GRAVEL GROUND COVER AND RESTORE TO GRASS \ (9310 6F ( �a � > A P PD (940.1) c3 J �+ \\ RI�RIp roti QHS \ TERRA E93S�' STING > ( F PILLAR ' 4) N%4i SE\� A o ) REMOVE EXISTING RETAINING WALLS, �� ` 23QQ \ '' D RESTORE NATURAL GRADING AND \ S (B) ` 20 (93581 GRASS 9, o 482 sq ft \ �\ ooh (935.5) 929.4 CONTOUR 9<< \ WOOD LINE (O.H.W.) \\ \ BORDER (N.G.V.D.1929) \\ I,932 (B6 PROPOSED TERRACE RETAINING W\ W/ 24" TALL BOXWOOD HEDGEROW \ (F) CONCRETE gam•- 2�) \ � WALK REMOVE ALL CONCRETE WALKS, GRAVENATURAL LAKE GROUNDCOVER,GRADING ARESTORE TOND GRASS \ \`..- (0DFR \ rvvlN�1`oAt< 726 sq ft \ (o) \ W06�-.- \.\ (932?J BORDER '•.� ` ✓SP KFOUE � --__, 8 (Q) \ eco•-- o. ...... 3`�..SONC. \.Q MINNETONKA f93? --- ___ \ (9,?,?. Q1, ASF ��RiaRAa o�c� �x EAST CRYSTAL BAY LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 SUMMER SOLSTICE SUNRISE --_ SUMMER SOLSTICE SUNRISE / k WINTER SOLSTICE WINTER SOLSTICE SUNRISE = i SUNRISE EXISTING SITE PLAN eSKucHe DESIGN GROU P Copyright 2019 F ?. KARL FOERSTER ORNAMENTAL GRASS NEPETA - WALKERS LOW HYDRANGEA - ANABELLE ARBORVITAE - EMERALD GREEN AUTUMN BLAZE MAPLE TREE WHITESPIRE BIRCH Af + # i x '9 _�Y w+* •_01 •/* 0000 � y j� . � -sly i �e. � .. _ ����, ,►� „+• "M AV 44 40 4mv A* � �,, � f,,. � " * , s `lle • T'� • � ' �1; i #f' „�' �y * '�( ++moi � � • * •� ti •a C.. a y l r(�} � � ! � l �i 'sR i4 •T� t�,�i { .. �i •� a • ♦.. * • r *. Ik i, • ♦ • •� r +r e . * BOXWOOD HEDGE AT ENTRY STONE MONUMENTS -AUTUMN BLAZE MAPLE (6 THUS) LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 SUMMER SOLSTICE SUNRISE - --_- SUMMER SOLSTICE SUNRISE L' k WINTER SOLSTICE '- WINTER SOLSTICE SUNRISE ,- SUNRISE A 0 20 40 60 LANDSCAPE PLAN eSKucHe DESI G N G ROUP Copyright 2019 r ,--_j Ll A i cl J i N 16 ' EXISTING TREES Warm ilmw REMAIN WHERE POSSIBLE ,ra k EXISTING TREES REMAIN WHERE POSSIBLE ILL A M6 Ir t*0wFw�_ AL 'A [M[KHLU VKEEIN ARBORVITAE \ GAME LAWN O"qlw PAVER MOTORCOURT INFOREST BLACK WASHED LANDSCAPE ROCK --- WHITESPIRE BIRCH I EXISTING TREES REMAIN WHERE POSSIBLE i KARL FOERSTER GRASS HEDGE AT PERIMETER OF RETAINING WALL ________ NEPATA GROUND COVER AT OUTSIDE EDGE OF MULCH PLANTING BED AT PERIMETER OF GAME LAWN Ai, -A 11 ELL - EXISTING RIP -RAP TO REMAIN DRY -SET TERRACE WITH SEAT LEDGE — BOXWOOD HEDGE KARL FOERSTER GRASS HEDGE LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 0 20 40 60 LANDSCAPE PLAN DESI G N GROUP Copyright 2019 r A EXISTING TREES REMAIN WHERE POSSIBLE ILL A M6 Ir t*0wFw�_ AL 'A [M[KHLU VKEEIN ARBORVITAE \ GAME LAWN O"qlw PAVER MOTORCOURT INFOREST BLACK WASHED LANDSCAPE ROCK --- WHITESPIRE BIRCH I EXISTING TREES REMAIN WHERE POSSIBLE i KARL FOERSTER GRASS HEDGE AT PERIMETER OF RETAINING WALL ________ NEPATA GROUND COVER AT OUTSIDE EDGE OF MULCH PLANTING BED AT PERIMETER OF GAME LAWN Ai, -A 11 ELL - EXISTING RIP -RAP TO REMAIN DRY -SET TERRACE WITH SEAT LEDGE — BOXWOOD HEDGE KARL FOERSTER GRASS HEDGE LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 0 20 40 60 LANDSCAPE PLAN DESI G N GROUP Copyright 2019 I 9! D 0 K] 4' .jk 0 GRAVEL TO BE REMOVED vat LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 0 20 40 60 EXISTING LANDSCAPING eS KllCHe DESIGN' G ROU P Copyright 2019 i' -o" 3'-0" I N LO LOWER LEVEL FLOOR PLAN TYP. CEILING HEIGHT = 4'-0" APPROX. S.F. = 3,672 CRAWL + 395 STORAGE 0' 2' 4' 6' 8' 10' 12' 14' 16' GRAPHIC SCALE 1 2'-10 1 /2" '-10 1/2" T 18'-3" L 3'-10 1 /2" I LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 eSKucHe oEsiGN G Roup Copyright 2019 LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 DESI G N GROUP Copyright 2019 LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 eSKucHe Copyright 2019 NORTH ELEVATION (STREET) EAST ELEVATION TOP OF HIGHEST FLAT PROOF SHEATHING TRUSS BEARING U.L. SUBFLOOR TRUSS BEARING "v M O 1y- M.L. SUBFLOOR 940.1' TOP OF CONC. BTM OF TJUSS v 938.0' HIGHEST EXISTING ADJOINING GRADE CRAWL SLAB 934.6' TOP OF FTG. ?z'-9 7/8" U.L. CEILING 1 +13'-8 3/4" U.L. SUBFLOOR 1+0 if .L SUBFLOOR 0' 2' 4' 6' 8' 10' 12' 14' 16' GRAPHIC SCALE LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 DESIG N GROUP Copyright 2019 / -7H -7H 10 \ M / ` l \ 0 I s • / U \ U `% / ol / .lit. (n c0 O! 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(P) ooh o��� m (9 .8) ° �(y� (93 \ / S _.(0) O�� GOA ` U -.J I /\ 6 POSED SI ENCr�<q�0 37.5) 9 v`q //'��� '� WILLOW \ SURVE ( (N) X98£ % (�A SE�%T �� "J 7 g3 % r \\ OOO BRIOG INE ,QO % ,ROOFO CLEAi�If ;'�., \ g wooD Sg`S \ ` 9 c/F i LL .6 �FRNano L CK \ `� BORDER �� V rED,WAY e° \ J (TYP) ,'�,,�\OOO CRq /93 So FLOOR 00 S� of QeJO�, 32.7) yLq�- K � 10.> (F) (P_ � WgCC � ` FLOOR A374 .g -i ��_ A - �O�� LEVEL= 4� C (N) REMOVE ALL GRAVEL GROUND COVER AND RESTORE TO GRASS \ (9310 6F ( �a � > A P PD (940.1) c3 J �+ \\ RI�RIp roti QHS \ TERRA E93S�' STING > ( F PILLAR ' 4) N%4i SE\� A o ) REMOVE EXISTING RETAINING WALLS, �� ` 23QQ \ '' D RESTORE NATURAL GRADING AND \ S (B) ` 20 (93581 GRASS 9, o 482 sq ft \ �\ ooh (935.5) 929.4 CONTOUR 9<< \ WOOD LINE (O.H.W.) \\ \ BORDER (N.G.V.D.1929) \\ I,932 (B6 PROPOSED TERRACE RETAINING W\ W/ 24" TALL BOXWOOD HEDGEROW \ (F) CONCRETE gam•- 2�) \ � WALK REMOVE ALL CONCRETE WALKS, GRAVENATURAL LAKE GROUNDCOVER,GRADING ARESTORE TOND GRASS \ \`..- (0DFR \ rvvlN�1`oAt< 726 sq ft \ (o) \ W06�-.- \.\ (932?J BORDER '•.� ` ✓SP KFOUE � --__, 8 (Q) \ eco•-- o. ...... 3`�..SONC. \.Q MINNETONKA f93? --- ___ \ (9,?,?. Q1, ASF ��RiaRAa o�c� �x EAST CRYSTAL BAY LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 SUMMER SOLSTICE SUNRISE --_ SUMMER SOLSTICE SUNRISE / k WINTER SOLSTICE WINTER SOLSTICE SUNRISE = i SUNRISE EXISTING SITE PLAN eSKucHe DESIGN GROU P Copyright 2019 F ?. KARL FOERSTER ORNAMENTAL GRASS NEPETA - WALKERS LOW HYDRANGEA - ANABELLE ARBORVITAE - EMERALD GREEN AUTUMN BLAZE MAPLE TREE WHITESPIRE BIRCH Af + # i x '9 _�Y w+* •_01 •/* 0000 � y j� . � -sly i �e. � .. _ ����, ,►� „+• "M AV 44 40 4mv A* � �,, � f,,. � " * , s `lle • T'� • � ' �1; i #f' „�' �y * '�( ++moi � � • * •� ti •a C.. a y l r(�} � � ! � l �i 'sR i4 •T� t�,�i { .. �i •� a • ♦.. * • r *. Ik i, • ♦ • •� r +r e . * BOXWOOD HEDGE AT ENTRY STONE MONUMENTS -AUTUMN BLAZE MAPLE (6 THUS) LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 SUMMER SOLSTICE SUNRISE - --_- SUMMER SOLSTICE SUNRISE L' k WINTER SOLSTICE '- WINTER SOLSTICE SUNRISE ,- SUNRISE A 0 20 40 60 LANDSCAPE PLAN eSKucHe DESI G N G ROUP Copyright 2019 r ,--_j Ll A i cl J i N 16 ' EXISTING TREES Warm ilmw REMAIN WHERE POSSIBLE ,ra k EXISTING TREES REMAIN WHERE POSSIBLE ILL A M6 Ir t*0wFw�_ AL 'A [M[KHLU VKEEIN ARBORVITAE \ GAME LAWN O"qlw PAVER MOTORCOURT INFOREST BLACK WASHED LANDSCAPE ROCK --- WHITESPIRE BIRCH I EXISTING TREES REMAIN WHERE POSSIBLE i KARL FOERSTER GRASS HEDGE AT PERIMETER OF RETAINING WALL ________ NEPATA GROUND COVER AT OUTSIDE EDGE OF MULCH PLANTING BED AT PERIMETER OF GAME LAWN Ai, -A 11 ELL - EXISTING RIP -RAP TO REMAIN DRY -SET TERRACE WITH SEAT LEDGE — BOXWOOD HEDGE KARL FOERSTER GRASS HEDGE LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 0 20 40 60 LANDSCAPE PLAN DESI G N GROUP Copyright 2019 r A EXISTING TREES REMAIN WHERE POSSIBLE ILL A M6 Ir t*0wFw�_ AL 'A [M[KHLU VKEEIN ARBORVITAE \ GAME LAWN O"qlw PAVER MOTORCOURT INFOREST BLACK WASHED LANDSCAPE ROCK --- WHITESPIRE BIRCH I EXISTING TREES REMAIN WHERE POSSIBLE i KARL FOERSTER GRASS HEDGE AT PERIMETER OF RETAINING WALL ________ NEPATA GROUND COVER AT OUTSIDE EDGE OF MULCH PLANTING BED AT PERIMETER OF GAME LAWN Ai, -A 11 ELL - EXISTING RIP -RAP TO REMAIN DRY -SET TERRACE WITH SEAT LEDGE — BOXWOOD HEDGE KARL FOERSTER GRASS HEDGE LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 0 20 40 60 LANDSCAPE PLAN DESI G N GROUP Copyright 2019 I 9! D 0 K] 4' .jk 0 GRAVEL TO BE REMOVED vat LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 0 20 40 60 EXISTING LANDSCAPING eS KllCHe DESIGN' G ROU P Copyright 2019 i' -o" 3'-0" I N LO LOWER LEVEL FLOOR PLAN TYP. CEILING HEIGHT = 4'-0" APPROX. S.F. = 3,672 CRAWL + 395 STORAGE 0' 2' 4' 6' 8' 10' 12' 14' 16' GRAPHIC SCALE 1 2'-10 1 /2" '-10 1/2" T 18'-3" L 3'-10 1 /2" I LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 eSKucHe oEsiGN G Roup Copyright 2019 LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 DESI G N GROUP Copyright 2019 LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 DESI G N GROUP Copyright 2019 NORTH ELEVATION (STREET) EAST ELEVATION TOP OF HIGHEST FLAT PROOF SHEATHING TRUSS BEARING U.L. SUBFLOOR TRUSS BEARING "v M O 1y- M.L. SUBFLOOR 940.1' TOP OF CONC. BTM OF TJUSS v 938.0' HIGHEST EXISTING ADJOINING GRADE CRAWL SLAB 934.6' TOP OF FTG. ?z'-9 7/8" U.L. CEILING 1 +13'-8 3/4" U.L. SUBFLOOR 1+0 if .L SUBFLOOR 0' 2' 4' 6' 8' 10' 12' 14' 16' GRAPHIC SCALE LAKEVIEWS 2605 N. Shore Dr. Orono, Minnesota CONCEPT DRAWINGS 23 MAY 2019 REVISED 25 MAY 2019 28 MAY 2019 30 MAY 2019 3 JUNE 2019 PRE -VARIANCE REVIEW 5 JUNE 2019 VARIANCE SET 19 JUNE 2019 DESIG N GROUP Copyright 2019 r pp \\ p7�i Zfe. . 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O � d T OHO ✓ o Z 0 �3 o_ O Z w W W O Z Q w L C- N F Z O H Z 0 N a j O J J Z W H j v d x o O U O d, d W Fw- X N r Z ¢ o M o t1°O 0 n u u F u n azo Q U ti m U F U J ti o a s _ d From: Melanie Curtis To: Ashley Mehbod Cc: Amir Mehbod; Laura Oakden Subject: RE: Dan & Heidi Martinson Date: Tuesday, July 9, 2019 8:00:47 AM Ashley Thank you for reaching out. I enjoyed working with you on your project and appreciate your kind words. I will share your comments with our other Planner, Laura Oakden (copied). We both worked with Mr. Martinson and his team and she will be handling the Martinson application due to our current caseload. Hope all is well! Melanie Melanie Curtis 2952.249.4627 F�mcurtis(dki.orono.mn.us All permitting is now done through our new online portal - LINK. From: Ashley Mehbod[mailto:ashley@pixiedustinc.com] Sent: Monday, July 8, 2019 9:21 PM To: Melanie Curtis Cc: Amir Mehbod Subject: Dan & Heidi Martinson Hi Melanie - I hope this email finds you well. It's been a long time. Amir and I met with Heidi and Dan Martinson over the weekend and we had the chance to review their house plans for 2605 Northshore Drive. We understand that they are seeking a variance to build inside the setback. We signed the form to indicate our support but I also wanted to reach out independently in support of their proposed plans. I told them they are lucky to have you leading the process and guiding them through approvals. Please let me know if you have any questions. Thanks, Melanie. Sincerely, Ashley Mehbod 2625 Northshore Drive Wayzata, MN 55391 Ashley Mehbod I PIXIE DUST 1612.306.3737 www.pixiedustinc.com Date Application Received: June 19, 2019 Date Application Considered as Complete: August 8, 2019 60 -Day Review Period Expires: October 7, 2019 To: Chair Ressler and Planning Commission Members Dustin Rief, City Administrator From: Laura Oakden, Planner Date: 19 August 2019 Subject: LA19-000049, Eskuche, 2605 North Shore Drive, Variances and Interim Use Permit Public Hearing Application Summary: The applicant is requesting variances for hardcover, buildings, and retaining walls in the 75' lakeyard, average lakeshore setback, side yard setback and lot area; as well as an IUP- Alteration over 50 cubic yards of material within the 75' lakeshore setback to construct a new home. Staff Recommendation: Planning Department Staff recommends approval of the proposed variance and interim use permit. Background This is a unique property in that an inlet from Lake Minnetonka encroaches into the lot, establishing an additional 75 lake yard into the lot. The applicant is proposing to build a new home, replacing the existing structure. The existing home sits forward of the 75' lakeyard setback, about X feet from the Lake Minnetonka and X feet from the inlet. The applicant proposes the new home further back away from the Lakeshore, Y feet from the Lake, and Y feet from the inlet. The proposal includes the removal of hardcover on the west side of the property and turn this space into a usable lawn area. To minimize the inlet encroachment, the applicant proposes to move the home closer to the east side property line, into the east side yard setback. The proposal also includes new hardcover for a patio within the 75' lake yard. Due to the existing home being located in the 75' lakeyard an interim use permit is required for movement of earth over 50 cubic yards in the lakeyard. To remove the existing home and create a lawn space as well as construct the new home, new grading will new done within the lake yard. LOT ANALYSIS WORKSHEET Section 78-305 - Builing Setbacks: DISTRICT LR -1A Required Existing Proposed Street 50' Roughly 290' Roughly 235' Side (west) 30' Roughly 90' 105' Side (east) 30' 24' 19' Lakeshore (main) 75' 30' 46' Lakeshore (inlet) 75' Roughly 50' Roughly 54' Average Lakeshore New Retaining wall exceeds 42" LA19-000049 August 19 2019 Page 2 of 6 Section 78- 305 - Lot Area/Width: DISTRICT Lot Area Lot Width Required 87,120 s.f. (2 acres) 200' Actual 81,213 s.f. (1.86 acre) 230'@ OHWL Section 78-1403- Structural Building Coverage: Total Lot Area Total Structural Coverage 81,213 s.f. (1.86 acre) Allowed: 16,242.6 s.f. (20%) Proposed: 5,729 s.f. (7%) Section 78-1680 - Hardcover Calculations: Stormwater Total Area Allowed Overlay District in Zone Hardcover Existing Hardcover Proposed Hardcover Tier Tier 1 81,213 s.f 20,303 s.f. 17,353 s.f. w/in 14,450 s.f. w/in (25 %) (21.37%) 75' (17,79%) 75' Applicable Regulations: Lot Area and Side Setback Variance (78-305 Zoning Code Section 78-72 provides options for the redevelopment of lots which do not meet the minimum area or width requirements for the respective zoning district. Substandard properties within the Shoreland Overlay District, like the subject lot, are able to be redeveloped without variances if specific standards are met; such as: 1. All setback requirements can be met; 2. A Type 1 sewage treatment system consistent with Minnesota Rules, chapter 7080, can be installed or the lot is connected to a public sewer; and 3. The impervious surface coverage meets all hardcover location and square footage restrictions of this chapter and the total square footage of hardcover does not exceed 25 percent of the entire lot area. 4. All other zoning district standards can be met. The applicants request for additional variances results in the property's inability to conform to all of the standards above. Therefore, lot area variances are required in order to redevelop the property. The ability to develop the property consistent with other existing developed properties in the neighborhood would be limited if the area and width variances are not granted. Average Lakeshore Setback. BuildinLys and retainine walls in the 75' Lakeshore (78-1279) The existing home sits almost entirely within the 75' lakeyard setback. The new home will take advantage of the existing homes footprint and massing. The applicant is requesting an average lakeshore setback variance due to proposed retaining walls which exceed the 42inch height maximum. The retaining walls will establish a flat usable lawn space along the side of the home. Retaining walls are also shown within the 75' lakeshore along the front/lakeside of the home. These walls will sit in the same footprint and the existing deck and will be used to create the patio/terrace area. LA19-000049 August 19 2019 Page 3 of 6 The new home is proposed to meet average lakeshore setback but the building will encroach into the 75' setback along the eastern and western edge of the home due to the property being almost entirely surrounded by lakeshore. Roughly 1,000 sq.ft. of the XXX new home is located outside of the existing massing and is a new encroachment in the 75' setback. Hardcover in the 75' Lakeshore (78-1680) The exiting home covers over 21% of the lot in hardcover the new proposed home will decrease the overall hardcover to 17.79%. The new home is proposing a new patio/ terrace which takes advantage of the existing patio footprint. The new patio encroaches in the 75' lakeshore of the property, roughly 75 sq.ft. The new patio and building encroachments are considered new hardcover within the lakeshore setback. Interim Use Permit- Movement of material exceeds 50 CY within the 75' lakeyard (78-1726) The applicant is proposing to cut roughly 310 cubic yards of material and fill roughly 650 cubic yards of material all within the 75' lakeyard. The existing home is located within the lakeyard and to remove this home, add the new home, and restore the grade for lawn space grading work will need to take place. The proposed grading and home are not out of character with the neighborhood. Governing Regulation: Variance (Section 78-123) In reviewing applications for variance, the Planning Commission shall consider the effect of the proposed variance upon the health, safety and welfare of the community, existing and anticipated traffic conditions, light and air, danger of fire, risk to the public safety, and the effect on values of property in the surrounding area. The Planning Commission shall consider recommending approval for variances from the literal provisions of the Zoning Code in instances where their strict enforcement would cause practical difficulties because of circumstances unique to the individual property under consideration, and shall recommend approval only when it is demonstrated that such actions will be in keeping with the spirit and intent of the Orono Zoning Code. Economic considerations alone do not constitute practical difficulties. Practical difficulties also include but are not limited to inadequate access to direct sunlight for solar energy systems. Variances shall be granted for earth -sheltered construction as defined in Minn. Stat. § 216C.06, subd. 2, when in harmony with this chapter. The board or the council may not permit as a variance any use that is not permitted under this chapter for property in the zone where the affected person's land is located. The board or council may permit as a variance the temporary use of a one -family dwelling as a two-family dwelling. According to MN §462.537 Subd. 6(2) variances shall only be permitted when: 1. The variance is in harmony with the general intent and purpose of the Ordinance. The proposed variances are in harmony with the intent and purpose of the Ordinance. The goal of the ordinance sis to reduce or eliminate improvements in the lake yard, the proposal shifts away from the lake yard as much as practical. 2. The variance is consistent with the comprehensive plan. The proposed variances to develop a nonconforming lot of record are consistent with the comprehensive plan. 3. The applicant establishes that there are practical difficulties. a. The property owner proposes to use the property in a reasonable manner not permitted by the official controls; The request to permit construction of the home on the substandard lot, in the proposed location within the lake, and side yard setbacks, appears to be reasonable as the property's reduced size and LA19-000049 August 19 2019 Page 4 of 6 orientation with respect to the lakeshore. The hardcover and retaining walls proposed within the lake yard appear to be reasonable. There are circumstances unique to the property not created by the landowner; The lake and its inlet limit the building envelope for the property. The surrounding lakeshore is unique property feature of the lane and The variance will not alter the essential character of the locality. The variances are requested in order to permit construction of a home designed to fit the character of the neighborhood according to the submitted information. Additionally City Code 78-123 provides additional parameters within which a variance may be granted as follows: 4. Economic considerations alone do not constitute practical difficulties. Economic considerations have not been a factor in the variance approval determination. 5. Practical difficulties also include but are not limited to inadequate access to direct sunlight for solar energy systems. Variances shall be granted for earth -sheltered construction as defined in Minn. Stat. § 216C.06, subd. 2, when in harmony with Orono City Code Chapter 78. This condition is not applicable. 6. The board or the council may not permit as a variance any use that is not permitted under Orono City Code Chapter 78 for property in the zone where the affected person's land is located. This condition is not applicable, as the use for a single family home is an allowed use in the LR -1A District. 7. The board or council may permit as a variance the temporary use of a one -family dwelling as a two-family dwelling. This condition is not applicable. 8. The special conditions applying to the structure or land in question are peculiar to such property or immediately adjoining property. The property's substandard size and orientation with respect to the lakeshore creates difficulties which may also apply to properties in the same neighborhood. 9. The conditions do not apply generally to other land or structures in the district in which the land is located. The property's substandard size and orientation with respect to the lakeshore creates difficulties which may also apply to properties in the same neighborhood. However, the location of the lake surrounding the building envelop is very unique to this property. 10. The granting of the application is necessary for the preservation and enjoyment of a substantial property right of the applicant. Granting a lot area, side yard and lake setback variances are necessary for the preservation of the property right of the application. The retaining walls in the lakeyard and average lakeshore setback, hardcover for the patio variances facilitate the use of the property for the new home and are necessary for the preservation of the property. 11. The granting of the proposed variance will not in any way impair health, safety, comfort or morals, or in any other respect be contrary to the intent of this chapter. Granting the requested variances in this unique situation is not contrary to the intent of the zoning chapter. 12. The granting of such variance will not merely serve as a convenience to the applicant, but is necessary to alleviate demonstrable difficulty. The variances do not merely serve as a convenience to the applicant. The variances are necessary as the property has considerable practical difficulties affecting development. The Commission may recommend or Council may impose conditions in granting of variances. LA19-000049 August 19 2019 Page 5 of 6 Any conditions imposed must be directly related to and must bear a rough proportionality to the impact created by the variance. No variance shall be granted or changed beyond the use permitted in this chapter in the district where such land is located. Applicable Regulation: Interim Use Permit (Section 78-1726) The Planning Commission may recommend and the Council may grant an Interim Use Permit (IUP). On the basis of the application and the evidence submitted, the city council determines that the use will comply with the following: 1) The use will meet the general performance standards in section 78-916 of this chapter; The grading will conform to the standards within Section 78-916 of the Zoning Code. 2) The use is allowed as an interim use in the applicable zoning district; grading of materials are permitted within the LR -1A zoning district; this statement is true. 3) The use will not delay anticipated development or redevelopment of the site; the proposed grading activity will be conducted in conjunction with the development of the new single family home on the property. This statement is true. 4) The use will not be in conflict with any provisions of the city code on an ongoing basis; the proposed grading activity will not be in conflict with the Code 5) The use will not adversely affect the adjacent property, the surrounding neighborhood, or other uses on the property where the use will be located; The result of the proposed grading will not change the intended residential use of the Property so there should be no change in the use and enjoyment of adjacent properties resulting from the lakeshore grading. The grading work on the Property as well as the forthcoming construction of the proposed home could result in additional noise, dust, vibration and traffic on the haul routes and immediate neighbors. To the degree possible, negative impacts should be limited and mitigated 6) The use will not impose additional unreasonable costs on the public; the lakeshore grading should not impact any public roadways. 7) The date or event that will terminate the use can be identified with certainty; the conclusion of the grading activity will coincide with the finalization of the construction of the proposed home on the property. An as -built survey shall be submitted to confirm conformance with the approved grading plan at the closing of the permits. 8) And the applicant agrees in writing to any conditions that the city council deems appropriate for the use, including a requirement for a financial security to ensure removal of all evidence of the use upon termination, and restoration of the site to prior or better conditions. The conditions shall be set forth in a development agreement between the property owner and the city, which agreement shall be recorded with the Hennepin County Recorder or Registrar of Deeds. The conditions of approval will be documented as required. Practical Difficulties Statement Applicant has provided supporting documentation regarding the applicable Practical Difficulties attached as Exhibit B, and should be asked for additional testimony regarding the application. LA19-000049 August 19 2019 Page 6 of 6 Practical Difficulties Analysis Staff finds applicant is working to improve the site by working within the existing building footprint and massing of the proposed home. The new home is further from the lakeshore compared to the existing home. The applicant is also reducing the overall hardcover of the property. Due to the location of the existing home in the lakeyard, grading will need to be done to remove the existing home and restore the lawn and for the new proposed home. The proposed IUP is reasonable to allow the construction of a new home. Engineer Comments The engineer completed a review of the grading plan and found no issues. A more thorough review will be completed when a building permit is submitted. Public Comments One neighbor has submitted an email in support of the project. It is included as exhibit F. Issues for Consideration 1. Does the Planning Commission find that that the property owner proposes to use the property in a reasonable manner which is not permitted by an official control? 2. Does the Planning Commission find that the variance(s), if granted, will not alter the essential character of the neighborhood? 3. Does the Commission find it necessary to impose conditions in order to mitigate the impacts created by the granting of the requested variance(s)? 4. Are there any other issues or concerns with this application? Planning Staff Recommendation Planning Staff recommends approval of the proposed variances and interim use permit. List of Exhibits Exhibit A. Application Exhibit B. Practical Difficulties Documentation Form Exhibit C. Proposed Survey Exhibit D. Proposed Plans and Elevations Exhibit E. Submitted Hardcover Calculations Exhibit F. Narrative Exhibit G. Neighbor's Comments Exhibit H. Annotated Survey Exhibit 1. Property Owners List and Map AGENDA ITEM Item No.: 11 Date: August 26, 2019 Item Description: LA19-000066 — Original file #17-3968 — Frederick Johnson, 1565 Orchard Beach Place, 2nd Extension of Resolution No. 6802 — Resolution Presenter: Melanie Curtis Agenda Consent Agenda Planner Section: 1. Purpose. This application is regarding a one-year extension of Resolution No. 6802 granting variances. 2. City Code. City Code Sections 78-129 provides for extension of variance approvals. Staff has previously approved an extension; City Council approval is required for additional one-year extensions, up to three total extensions. 3. Background/ Summary. The applicant is requesting renewal of variances originally granted via Resolution No. 6802 on October 23, 2017. The approvals involved variances for lot area and width; and average lakeshore setback for construction of a residence. Due to the delay in commencement of construction, the approvals granted via Resolution No. 6802 were extended administratively resulting in a new expiration date of October 23, 2018. The applicant has been developing plans to build a new home on the property for over a year. He requests the Council approve a second extension one additional year per the terms of the prior approvals, to October 23, 2020. This request was received on August 15`h, prior to the October 23rd expiration. A permit is expected in the coming weeks. 4. Staff Recommendation. There have been no substantive Code changes which affect this project since the original approvals. Staff recommends approval of the owner's request for a one-year extension of the approvals granted via Resolution No. 6802. A draft approval resolution has been provided for Council's consideration. COUNCIL ACTION REQUESTED Motion to adopt or amend the extension resolution. Exhibits A. Draft Resolution B. Resolution No. 6802 References City Code Sections 78-129 Prepared By: VY1GG Reviewed By: J. Barnhart Approved By: P CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. A RESOLUTION GRANTING AN EXTENSION OF THE VARIANCES AND CONDITIONAL USE PERMITS ESTABLISHED PER RESOLUTION 6802 ORIGINAL FILE NO. 17-3968 (NEW FILE NO. LA19-000066) WHEREAS, the City of Orono is a municipal corporation organized and existing under the laws of the State of Minnesota; and WHEREAS, the City Council of the City of Orono (hereinafter "City Council") has adopted land development regulations for the orderly, economic and safe development of land within the City; and WHEREAS, pursuant to Orono Municipal Zoning Code Section 78-129, Frederick Johnson (hereinafter the "Applicant") has applied for an extension of the approvals granted under Resolution No. 6802 for property 1565 Orchard Beach Place and legally described as: Commencing at the Southeast corner of Block 18, thence North 100 feet; thence Northwesterly to the Northeast corner of Lot 19; thence South 100 feet to the Lake Shore; thence East to the point of beginning. All within SAGA HILL REVISED, Hennepin County, Minnesota (hereinafter the "Property"); WHEREAS, on October 23, 2017 the City Council of Orono, Minnesota adopted Resolution No. 6802 which approved the following in conjunction with redevelopment of the Property: • Variances from Section 78-330 to allow development of the Property which has 0.22 acres in area and 83 feet of width where 1.0 acre and 140 feet of width are required; • Variances from Section 78-1279 to allow construction of a new residence lakeward of the average lakeshore setback where no building is permitted; and WHEREAS, the City Council has considered the application by the Applicant for an extension of the approvals granted under Resolution No. 6802 for development of the Property; and WHEREAS, the Applicant was not able to commence construction within the allotted one-year established by Resolution No. 6802 nor the one year administrative extension; and CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. WHEREAS, pursuant to Orono Municipal Zoning Code Sections 78-129, the Applicant has made a request for an extension of the approvals granted in Resolution No. 6802. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Orono does hereby grant an extension to October 23, 2020 of the approvals granted under Resolution No. 6802, subject to the following conditions: 1. Authorities granted by this resolution run with the Property not with the Owners, but are permissive only and must be exercised by obtaining building permits and/or land alteration permit by October 23, 2020 or the approvals will expire on that date. 2. All other findings, conclusions, and conditions of Resolution No. 6802 shall remain in effect. 3. Violation of or non-compliance with any of the terms and conditions of the conditional use permit approval and site plan approval shall constitute a violation of the zoning code, shall automatically terminate any authority granted herein, and shall be punishable as a misdemeanor. ADOPTED by the Orono City Council on the 26th day of August 2019. ATTEST: CITY OF ORONO: Anna Carlson, City Clerk Dennis Walsh, Mayor CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 68 0 2 A RESOLUTION APPROVING VARIANCES FROM MUNICIPAL ZONING CODE SECTIONS 78-330 AND 78-1279 FILE NO. 17-3968 WHEREAS, on August 23, 2017, Frederick Johnson (hereinafter the "Applicant'), applied for variances from the City Code for the property addressed 1565 Orchard Beach Place also known as Hennepin County PID 07-117-23-43-0026 and legally described as: Commencing at the Southeast comer of Block 18, thence North 100 feet; thence Northwesterly to the Northeast comer of Lot 19; thence South 100 feet to the Lake Shore; thence East to the point of beginning. All within SAGA HILL REVISED, Hennepin County, Minnesota. (hereinafter the "Property"); WHEREAS, the Applicant has made application to the City of Orono for variances to Orono Municipal Zoning Code Section 78-330 to allow development of the Property which is substandard with respect to area and width having 9,645 square feet or 0.22 acre in area and 83 feet in width where 1.0 acre in area and 140 feet in width are required; and WHEREAS, the Applicant has made application to the City of Orono for a variance to Orono Municipal Zoning Code Section 78-330 to allow a rear yard setback of 5.6 feet where a 30 foot setback is required; and WHEREAS, the Applicant has made application to the City of Orono for a variance to Orono Municipal Zoning Code Section 78-1279 to allow development of the Property which is entirely lakeward of the average lakeshore setback line determined by the home on the adjacent property at 1555 Orchard Beach Place; and WHEREAS, on September 18, 2017, after published and mailed notice in accordance with Minnesota Statutes and the City Code, the Planning Commission held a public hearing, at which time all persons desiring to be heard concerning this application were given the opportunity to speak thereon; and WHEREAS, on September 18, 2017, the Planning Commission recommended denial of the lot area, lot width, rear yard setback, and average lakeshore setback variances; and WHEREAS, on October 9, 2017, the City Council reviewed the application and the recommendations of the Planning Commission and City staff; and CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 68 O 2 WHEREAS, on October 9, 2017, the City Council directed preparation of findings for approval of the lot area, lot width, and average Lakeshore setback variances, and also for denial of the rear yard setback variance; and NOW, THEREFORE, BE IT RESOLVED that the City Council of Orono, Minnesota hereby approves the requested lot area, lot width, and average lakeshore setback variances as described above based on one or more of the following findings of fact concerning the Property: FINDINGS OF FACT: 1. This application was reviewed as Zoning File #17-3968. The analysis contained within staff memos and the exhibits attached to the aforesaid memos, all minutes from the above mentioned meetings, and any and all other materials distributed at these meetings are hereby incorporated by reference. 2. The Property is located in the LR -1 B One Family Lakeshore Residential Zoning District. 3. The Property contains 0.22 acres in area and has a defined lot width of 83 feet. 4. The Property is within Tier 1 and hardcover is limited to 25% according to the Stormwater Quality Overlay District. 5. Applicant has applied for the following variance[s]: a. Lot Area Variance b. Lot Width Variance c. Average Lakeshore Setback Variance d. Rear Yard Setback Variance 6. In considering this application for variances, the Council has considered the advice and recommendation of the Planning Commission and the effect of the proposed variances upon the health, safety and welfare of the community, existing and anticipated traffic conditions, light and air, danger of fire, risk to the public safety, and the effect on values of property in the surrounding area. ANALYSIS: 1. "Variances shall only be permitted when they are in harmony with the general purposes and intent of the ordinance ...." The lot width and lot area variances are consistent with the general intent of the Ordinance. The requested average lakeshore setback variance is in harmony with the Ordinance as the only adjacent neighbor sits at a higher elevation. CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 68 0 2 2. "Variances shall only be permitted . . . when the variances are consistent with the comprehensive plan." The variances resulting in a permit for construction of a single family residence in a residential zone are consistent with the Comprehensive Plan. 3. "Variances may be granted when the applicant for the variance establishes that there are practical difficulties in complying with the zoning ordinance. 'Practical difficulties,' as used in connection with the granting of a variance, means that: a. The property owner in question proposes to use the property in a reasonable manner, however, the proposed use is not permitted by the official controls. The request to permit construction of a home on the substandard lot, in the proposed location lakeward of the average lakeshore setback, appears to be somewhat reasonable as the Property's reduced size and the angle of the lot lines with respect to the lakeshore and adjacent properties creates difficulties. b. The plight of the landowner is due to circumstances unique to his property not created by the landowner. The uniquely small size, location with respect to adjacent lots, and required setbacks prevent development of any residential structure. c. The variance, if granted, will not alter the essential character of the locality." The variances are requested in order to permit construction of a home. 4. "Economic considerations alone do not constitute practical difficulties." Economic considerations have not been a factor in the variance approval determination. 5. "Practical difficulties also include but are not limited to inadequate access to direct sunlight for solar energy systems. Variances shall be granted for earth -sheltered construction as defined in Minn. Stat. § 216C.06, subd. 2, when in harmony with Orono City Code Chapter 78." This condition is not applicable. 6. "The board or the council may not permit as a variance any use that is not permitted under Orono City Code Chapter 78 for property in the zone where the affected person's land is located." This condition is not applicable, as the use for a residence is an allowed use in the LR -1 B Lakeshore Residential District. 7. "The board or council may permit as a variance the temporary use of a one -family dwelling as a two-family dwelling." This condition is not applicable. CITY OF ORONO RESOLUTION OF THE CITY COUNCIL NO. 680 8. "The special conditions applying to the structure or land in question are peculiar to such property or immediately adjoining property." The Property's substandard size is unique to this immediate neighborhood. 9. "The conditions do not apply generally to other land or structures in the district in which the land is located." The Property is 0.22 acre in area and is surrounded by properties with lot areas which more than double the Property's acreage. The conditions do not apply to other land in the immediate neighborhood and district. 10. "The granting of the application is necessary for the preservation and enjoyment of a substantial property right of the applicant." Granting lot area, lot width, and average lakeshore setback variances are necessary for the preservation of the property right of the Applicant. 11. "The granting of the proposed variance will not in any way impair health, safety, comfort or morals, or in any other respect be contrary to the intent of this chapter." Granting lot area, lot width, and average lakeshore setback variances in this unique situation is not contrary to the intent of the zoning chapter. 12. "The granting of such variance will not merely serve as a convenience to the applicant, but is necessary to alleviate demonstrable difficulty." The variances for lot width, lot area, and average lakeshore setback are necessary, and do not merely serve as a convenience to the Applicant. CONCLUSIONS, ORDER AND CONDITIONS: Based upon one or more of the above findings, the Orono City Council hereby grants variances to Orono Municipal Zoning Code Section 78-330 to allow development of the Property which has 9,645 square feet or 0.22 acre in area and 83 feet in width where 1.0 acre in area and 140 feet in width are required; and a variance to Orono Municipal Zoning Code Section 78-1279 to allow construction of a home on the Property which will be located entirely lakeward of the average lakeshore setback line, subject to the following conditions: 1. Council approval is based on the entire record, above Findings. 2. The approved project shall conform to the site plan by Sharratt Design & Co, dated 09/26/17 submitted by the Applicants and annotated by City staff, attached to this Resolution as Exhibit A. 3. The rear yard setback variance denial findings are listed within Resolution No. , adopted on 4 CITY OF ORONO RESOLUTION OF THE CITY COUNCIL 4. Any amendments to the plans which are not in conformity with City codes may require further Planning Commission and City Council review. 5. Authorities granted by this resolution run with the Property not with the Applicants, but are permissive only and must be exercised by obtaining a building permit for the new construction and commencing construction of said project. A framing inspection must be completed within one year of the date of Council approval, or the variance will expire on that date (October 23, 2018). 6. Violation of or non-compliance with any of the terms and conditions of this resolution may result in the termination of any authority granted herein. ADOPTED by the Orono City Council on this 23rd day of October, 2017. ATTEST: Anna Carlson, City Clerk CITY OF ORONO: Dennis Walsh, Mayor G. GFE.-851 s E. SLAB O BE A2 AS AS AS Aa Al /- (ORIGINALLY TOLD � 20' REQUi�D.) � mo/—i' 4 Co i 1 zt,/I Ero RE r o D � Approved I Building l� Envelope ILT --- NN, SETBi CK 0 v ---- ------ \ .`G \ ``I? X94 011qk LAKE (9�OF ,i1 I N N E T .S� oNK A CURRENT VARIANCE SUBMITTAL: 1 SITE PLAN mono,0 I * 10 20 40 I CONC. WTILIT7 IPADS I 68 0.2 I ` I Exhibit A R®sol No. #17-3968 PROJECT TEAM /Wyt ARCHITECT 6WARRATT DE61- " CO. LLC, CONTACT: MIKE 644MATT STRUCTURAL ENGINEER COMPANY CONTACT: ADDRESS ADEM66 2 P.IQ$ FVONE 2 GENERAL CONTRACTOR COMPANY CONTACT, ADDIE66 ADDRE6S 2 PWOPW PWONE 2 SITE INFO. LOT AREA: 9,641 SF. EXISTMG HARDCOVER -(to be removed) 311 SF. 4% HOUSE KIN: 63 SEE SEE, GAR SLAB 264CONSTRUCTION —1— GONC. S 42 GCNC. STEPS 28 JOHNSON PROPOSED HARDCOVER: 1966 SF. • 2111 NT(Vicl. front stoop T. 1469 DRIVEWA7: 462 DRIVEWAY: SPEC HOME SIDEWALK 39 ALLOWED HARDCOVER (TIER U • 29% 1565 ORCHARD BEACH PLACE ORONO, MN 55%4 EXISTING H.G. N THE 15' LAKE SETBACK 51 SF. (TO BEREMOVED) E. CONC. STAIRS 2% SF. E. HOUSE FDTN 28 Sr. SHEET Al NUMBER PROPOSED W.G. IN THE 19' LAKE SETBACK 0 OF. RraLNon® 0 COPYRIGHT 2017SSHAFN/.- TTT DESIGN " COONRAN%LLC AGENDA ITEM Item No.: 12 Item Description: 2018 Audit Presentation Date: August 26, 2019 Presenter: Ronald Olson, Finance Director Agenda Presentation Section: 1. Purpose. The purpose of this item is to publically present the 2018 audit and Comprehensive Annual Financial Report (CAFR) to the Council and public. 2. Background. Upon completion of the annual audit, the City's auditors publically present the results to the Mayor and Council. Michelle Hoffman from Clifton Larson and Allen is here tonight to present the 2018 audit results. COUNCIL ACTION REQUESTED: No action is required. This is an information item only. Exhibits A. 2018 CAFR B. Governance Letter C. Internal Control Report Prepared By: sj Reviewed By: Approved By: CITY OF ORONO, MINNESOTA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2018 PREPARED BY THE FINANCE DEPARTMENT OF THE CITY OF ORONO, MINNESOTA RON OLSON DIRECTOR OF FINANCE CITY OF ORONO TABLE OF CONTENTS YEAR ENDED DECEMBER 31, 2018 INTRODUCTORY SECTION LETTER OF TRANSMITTAL OFFICIAL DIRECTORY ORGANIZATIONAL CHART FINANCIAL SECTION INDEPENDENT AUDITORS' REPORT MANAGEMENT'S DISCUSSION AND ANALYSIS BASIC FINANCIAL STATEMENTS STATEMENT OF NET POSITION STATEMENT OF ACTIVITIES GOVERNMENTAL FUNDS BALANCE SHEET 1 5 n. 7 10 18 19 WE RECONCILIATION OF THE BALANCE SHEET TO THE STATEMENT OF NET POSITION - GOVERNMENTAL ACTIVITIES 21 STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES 22 RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES - GOVERNMENTAL ACTIVITIES 23 PROPRIETARY FUNDS STATEMENT OF NET POSITION 24 STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION 25 STATEMENT OF CASH FLOWS 26 NOTES TO FINANCIAL STATEMENTS 27 REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GENERAL FUND - BUDGET TO ACTUAL (GAAP BASIS) 56 GENERAL FUND BUDGET TO ACTUAL COMPARISON 57 SCHEDULE OF FUNDING PROGRESS FOR POSTEMPLOYMENT BENEFIT PLAN 58 PERA SCHEDULE OF THE CITY'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY 59 PERA SCHEDULE OF CITY CONTRIBUTIONS 60 CITY OF ORONO TABLE OF CONTENTS (CONTINED) YEAR ENDED DECEMBER 31, 2018 COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES 0137�1�1_t1L�]:Zei�]117�1�1����_1��1�1� COMBINING BALANCE SHEET 61 COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES 62 NONMAJOR SPECIAL REVENUE FUNDS COMBINING BALANCE SHEET 63 COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES 64 ffl ilk] Ji/_1911010]al:7�9al000101me0101RIM COMBINING BALANCE SHEET 65 COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES 66 NONMAJOR CAPITAL PROJECT FUNDS COMBINING BALANCE SHEET 67 COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES 68 NONMAJOR PROPRIETARY FUNDS COMBINING STATEMENT OF NET POSITION 69 COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION 70 INTERNAL SERVICE FUNDS COMBINING STATEMENT OF NET POSITION 71 COMBINING STATEMENT OF REVENUE, EXPENSES, AND CHANGES IN NET POSITION 72 COMBINING STATEMENT OF CASH FLOWS 73 STATISTICAL SECTION (UNAUDITED) NET POSITION BY COMPONENT 74 CHANGES IN NET POSITION 75 FUND BALANCES, GOVERNMENTAL FUNDS 77 CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS 78 TAX CAPACITY VALUE AND ESTIMATED MARKET VALUE OF TAXABLE PROPERTY 79 DIRECT AND OVERLAPPING TAX RATES PRINCIPAL PROPERTY TAXPAYERS CITY OF ORONO TABLE OF CONTENTS (CONTINED) YEAR ENDED DECEMBER 31, 2018 PROPERTY TAX LEVIES AND COLLECTIONS 82 RATIOS OF OUTSTANDING DEBT BY TYPE 83 RATIOS OF GENERAL BONDED DEBT OUTSTANDING 84 DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT 85 LEGAL DEBT MARGIN INFORMATION 86 PLEDGED REVENUE 87 DEMOGRAPHIC AND ECONOMIC STATISTICS PRINCIPAL EMPLOYERS 0.11 FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION 90 OPERATING INDICATORS BY FUNCTION 91 CAPITAL ASSET STATISTICS BY FUNCTION 92 INTRODUCTORY SECTION \kESH04� August 14, 2019 CITY OF ORONO MUNICIPAL OFFICES STREET ADDRESS MAILING ADDRESS: 2750 Kelley Parkway P.O. Box 66 Orono, MN 55356 Crystal Bay, MN 55323-0066 To the City Council and Citizens of the City of Orono: The comprehensive annual financial report (CAFR) of the City of Orono, Minnesota (the City) for the fiscal year ended December 31, 2018 is hereby submitted. Management assumes full responsibility for both the accuracy of the data, and the completeness and fairness of the presentation, including all disclosures, based on a comprehensive framework of internal control 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. Minnesota Statutes require that the City have an annual audit performed by a certified public accountant or the State Auditor. The City appointed the certified public accounting firm of Clifton LarsonAllen LLP to perform the audit for the year ended December 31, 2018. The independent auditor's report on the basic financial statements is unqualified, and is included in the financial section of this report. Accounting principles generally accepted in the United States of America require that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management's Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The City's MD&A can be found immediately following the report of the auditors. PROFILE OF THE CITY The City was incorporated effective January 1, 1955. The City is located on the northern shore of Lake Minnetonka about 15 miles west of the city of Minneapolis. Of the City's 24.5 square miles of area, 50% is open water or marshland (with a total of 12.3 square miles of land area). Of Lake Minnetonka, 40% of the shoreline and 33% of the lake area is in the City. The City is a third ring suburb in the seven -county metropolitan Twin Cities area of Minneapolis/St. Paul, and is located on Lake Minnetonka, the tenth largest and most heavily used recreational lake in Minnesota. This heavy use is a result of the quality of the lake's aesthetic appeal, together with its proximity to the metropolitan urban core. The City developed primarily because of this aesthetic amenity. [a] Telephone (952) 249-4600 • Fax (952) 249-4616 www.cLorono.mn.us PROFILE OF THE CITY (CONTINUED) The City is a residential community with primarily single-family housing, and includes a small commercial district. The City totally surrounds two communities, which are part of the original township, and substantially surrounds a third community. The City cooperates with these cities for the most cost effective provision of City services. The City is home to many of the metropolitan area's top executives who appreciate the community's natural amenities. It is anticipated that the positive appeal of the community, together with the extent of available land, will see the community experiencing continued development for the next ten years. The City operates under the "Optional Plan A" form of government as defined in Minnesota Statutes. Under this plan, the City Council, composed of an elected mayor and four elected trustees or council members, exercises legislative authority and determines all matters of policy. The City Administrator, appointed by the City Council, is responsible for the proper administering of all affairs relating to the City. The City provides a variety of municipal services which include: police protection, fire protection, street maintenance, building inspection, planning, and zoning, public improvements, general administrative services, public water and sewer utilities, and a municipal golf course. The City adopts an annual budget for the General Fund and certain Special Revenue Funds. The City has established budgetary control at the department level. LOCALECONOMY The City is in a strong financial position. Because of its strong residential tax base, and conservative fiscal philosophy, the City continued in 2018 to have a tax capacity rate that is one of the lowest in the county, ranking second lowest of 45 communities. The strength of the City's financial condition is reflected in its bond rating of Aaa since 2006 for all bond issues. LONG-TERM FINANCIAL PLANNING The Metropolitan Council requires all cities in the seven -county metropolitan area to have a Comprehensive Plan. The Metropolitan Council and state statutes require cities to update their plans every 10 years. The Orono Comprehensive Plan serves as a guide for orderly and economic private and public improvement. The scope of the plan is intended to include almost every factor that influences investments or improvements in the City. The City of Orono's Comprehensive Plan has been updated and approved by the City Council in 2010. In 2011, the City analyzed the condition of its street infrastructure. This information was used to develop a pavement management plan, which provides the basis for planning and funding street improvements. In 2012, this plan was incorporated into a comprehensive Capital Improvement Plan (CIP). The CIP is intended to be updated annually as part of the budgeting process. This was done during 2018. (2) RELEVANT FINANCIAL POLICIES The City is in the process of reviewing and formalizing its financial policies. The City recently updated its investment policy. In 2011, the City amended its fund balance policy to reflect the requirements of fund balance reporting addressed by GASB Statement No. 54. The policy also sets a fund balance minimum and maximum for the General Fund. The CIP that was adopted in 2012 is updated annually and is the basis for long-range capital planning and budgeting for the City. MAJOR INITIATIVES Cooperative Efforts with Other Jurisdictions The City is involved in a cooperative arrangement for fire services with the City of Long Lake. The cities of Long Lake and Orono jointly own a fire station and have a started the process of extending the fire services agreement. The City provides police protection to the cities of Spring Park, Minnetonka Beach, and Mound. The efficiencies provided by one department serving four communities provide all of the cities enhanced services. For example, one larger department allows for dedicated investigators, school resource officers, and participation in a regional drug task force. The City continues to be involved with a group of fourteen cities located adjacent to Lake Minnetonka in an effort to identify new opportunities for cooperative service delivery to enable improved services and increased efficiency. Water and Sewer Infrastructure The City operates and maintains both a water distribution and sanitary sewer collection system. The City's sanitary sewer collection system discharges into several Metropolitan Council Environmental Services (MCES) interceptor sewers for treatment by MCES at the Blue Lake treatment plant. The City pays MCES for sanitary sewer treatment charges on a monthly basis, and these MCES treatment costs are included in the City's sewer billing to residents. The City is continuing a proactive infiltration and inflow reduction program to eliminate significant sources of inflow and infiltration of ground water into the City's sanitary sewer system. In 2018, the City invested $50,000 in a sewer lining project to promote this effort. Because the MCES charges are based on measured flow, any reduction of inflow and infiltration results in lower charges. MCES charges are increasing faster than any other expense of the utility. The City has two water towers and four wells to serve the needs of the urban portion of the City. The recently installation of well number four in the northern part of the City provides firm capacity for fire protection, as well as capacity needed for future development along the highway 112 corridor. The development along the corridor picked up in 2018 resulting in a significant increase in utility connections. During the course of 2018, the City continued to integrate its new asset management system into daily operations. Originally purchased in 2016 and used to track equipment and infrastructure life cycles in conjunction with the City's CIP, it is now being used to produce work orders, track time, and document maintenance. Specifically in 2018, the project management features of the system were developed and implemented. This process has resulted in improved efficiency and provides a more accurate tracking of project expenditures. (3) AWARDS AND ACKNOWLEDGEMENTS Acknowledgements We would like to express our appreciation to the entire City staff for their individual contributions in assisting with the preparation of this report and to the outside agencies that assisted with essential information for this report. We also would like to express appreciation to the Mayor and City Council members for their interest and support in planning and conducting the financial operations of the City. Sincerely, Ronald J. Olson Finance Director (4) CITY OF ORONO OFFICIAL DIRECTORY YEAR ENDED DECEMBER 31, 2018 [a] III W«611101[N I W_1 k I eZell9:1 I:Zo7212 [a /_1I&9 Dennis Walsh Mayor Richard Crosby II Council Member Wendy Dankey Council Member Aaron Printup Council Member Victoria Seals Council Member CITY OFFICIALS Dustin Rief City Administrator Ronald Olson Finance Director - Treasurer (5) CITY OF ORONO ORGANIZATIONAL CHART YEAR ENDED DECEMBER 31, 2018 Public Contracted Mayor & Advisory Services Council Commissions • Fire • Planning Commission • Building Inspections • Park & Environment Comm. • Legal • Police Advisory Commission • Engineer g City • Long Lake Fire Advisory • Assessor Administrator Commission • Auditor • Hwy 12 Turnback Committee • Bond Counsel • Financial Advisor . City Clerk Admin. Support Asst. Public Works Director / Finance Community Development Police Chief City Engineer Director Director • Roads/Park • Golf Super. • Accountant • Senior Planner Deputy Chief Lead (.5 FTE) • Pa oll/U.B. g • Building Official • Sewer/Water • Seasonal FTE (' ) IT Technician •City Planner Lead Asst. Super. • Planning Assistant Patrol Sgt. (3) • Maintenance • Seasonal • Admin. Support Asst. Investigative Sgt (1) Staff (7) Clubhouse Mgr. •Patrol Officers (21) • Seasonal • PT Patrol Officers (2) Staff • CSO (1 FT, 1 PT) • Police Office Manager • Admin. Support Asst. (2) • Reserve Officers (6) FINANCIAL SECTION CliftonLarsonAllen LLP CLAconnect.com INDEPENDENT AUDITORS' REPORT Honorable Mayor and the City Council City of Orono, Minnesota Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business - type activities, each major fund, and the aggregate remaining fund information of the City of Orono, as of and for the year ended December 31, 2018, and the related notes to the financial statements, which collectively comprise the City of Orono`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. Auditors' 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 from 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 auditors' 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 entity'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 entity'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 presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. A member of Nexia c�> International Honorable Mayor and the City Council City of Orono, Minnesota 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 of Orono as of December 31, 2018, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management's discussion and analysis, budgetary comparison information and schedule of funding progress, as listed in the table of contents 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 of Orono`s basic financial statements. The introductory section, combining and individual fund statements and schedules and statistical sections are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual fund statements and schedules 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 other information is fairly stated, in all material respects, in relation to the basic financial statements as a whole. The introductory and statistical sections 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. N Honorable Mayor and the City Council City of Orono, Minnesota Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated August 14, 2019, on our consideration of the City of Orono`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 result of that testing, and not to provide an opinion on the effectiveness of the City of Orono`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 City of Orono`s internal control over financial reporting and compliance. CliftonLarsonAllen LLP Minneapolis, Minnesota August 14, 2019 on CITY OF ORONO, MINNESOTA MANAGEMENT'S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2018 As management of the City of Orono, Minnesota (the City), we have provided readers of the City's financial statements with this narrative overview and analysis of the financial activities of the City for the fiscal year ended December 31, 2018. FINANCIAL HIGHLIGHTS o The net position of the City's governmental activities increased by $2,351,920 during the year, ending at $25,965,182. o The net position of the City's business -type activities increased by $376,144 during the year, ending at $23,004,161. o The fund balance of the General Fund increased by $7,730 during the year to $4,454,566 at year-end. o The Water and Recycling Funds reported operating losses of $129,659 and $14,009, respectively. o The Sewer, Storm Water, and Cable Television Funds reported operating incomes of $116,218, $177,754, and $26,773, respectively. OVERVIEW OF THE FINANCIAL STATEMENTS The Management's Discussion and Analysis is intended to serve as an introduction to the City's basic financial statements, which are comprised of three components: 1) government -wide financial statements, 2) fund financial statements, and 3) notes to the basic financial statements. This report also contains other information in addition to the basic financial statements themselves. 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 private sector businesses. The statement of net position presents information on all the City's assets, deferred outflows of resources, liabilities, and deferred inflows of resources, with the difference between the assets and deferred outflows and liabilities and deferred inflows reported as net position. Over time, increases 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 to 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. delinquent taxes and special assessments). IN CITY OF ORONO, MINNESOTA MANAGEMENT'S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2018 Both of the government -wide financial statements distinguish functions of the City that are principally supported by property taxes and intergovernmental revenues (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 include general government, public safety, streets, and parks and recreation. The business -type activities of the City include enterprises for water operating, sewer operating, storm water, recycling, and cable television. 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. The funds of the City are divided into two categories — governmental funds and proprietary funds. Governmental Funds — Governmental funds are used to account for essentially the same functions 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 the 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 of the government's near-term, financing decisions. Both the governmental funds balance sheet and the statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate the comparison between governmental funds and governmental activities. The fund financial statements present information for each major governmental fund in separate columns. Data from the nonmajor governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements elsewhere in this report. The City adopts an annual appropriated budget for the General Fund. Budget -to -actual comparisons are provided in this financial report for this fund. Proprietary Funds — The City maintains two types of proprietary funds. Enterprise funds are used to report the same functions presented as business -type activities in the government -wide financial statements. The Internal Service Funds are used to accumulate and allocate insurance costs to the various City functions as well as to account for the accrual of sick and vacation days that are earned by the City's employees. The Internal Service Funds are predominantly used by governmental functions, however, they are included within the governmental activities and the business -type activities in the government -wide financial statements based on each respective share of activity. Notes to Basic Financial Statements — The notes to basic financial statements provide additional information that is essential to a full understanding of the data provided in the government -wide and fund financial statements. CITY OF ORONO, MINNESOTA MANAGEMENT'S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2018 Other Information — Combining statements and schedules for nonmajor funds are presented immediately following the notes to basic financial statements. The following is a summary of the City's net position: Current and Other Assets Capital Assets Total Assets Deferred Outflows of Resources Noncurrent Liabilities Outstanding Other Liabilities Total Liabilities Deferred Inflows of Resources Net Position: Net Investment in Capital Assets Restricted Unrestricted Total Net Position Current and Other Assets Capital Assets Total Assets Deferred Outflows of Resources Noncurrent Liabilities Outstanding Other Liabilities Total Liabilities Deferred Inflows of Resources Net Position: Net Investment in Capital Assets Unrestricted Total Net Position Governmental Activities 2018 $ 11,677,457 30, 201,187 41,878,644 3,438,365 2017 $ 13,112,921 26,281,233 39,394,154 4,353,759 10,632,106 11,832,262 3,819,805 2,933,855 14,451,911 14,766,117 4,899,916 5,335,406 23,370,988 19,020,035 3,434,418 3,699,095 (840,224) 894,132 $ 25,965,182 $ 23,613,262 Business -Type Activities 2018 2017 $ 5,804,126 $ 6,667,612 18,898,051 18,002,404 24,702,177 24,670,016 62,763 96,026 899,101 980,586 772,946 1,072,332 1,672,047 2,052,918 88,732 85,107 17,917,465 16,940,333 5,086,696 5,687,684 $ 23,004,161 $ 22,628,017 The City's financial position is the product of many factors. For example, the determination of the City's net investment in capital assets involves many assumptions and estimates, such as current and accumulated depreciation amounts. A conservative versus liberal approach to depreciation estimates, as well as capitalization policies, will produce a significant difference in the calculated amounts. Net position increased by $2,728,064 ($2,351,920 Governmental, $376,144 Business -Type) from current year activity, largely due to increased charges for services and both operating and capital grants and contributions. CITY OF ORONO, MINNESOTA MANAGEMENT'S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2018 The City has historically been financially conservative, managing revenues and expenditures/expenses to assure operation of a balanced budget. The ongoing management of revenues and expenditures/expenses and the sound financial position the City has attained have resulted in the City's excellent bond ratings: Aaa for all general obligation bond issues. The following is a summary of the City's change in Governmental net position: Overall revenues increased 21.42% between 2017 and 2018. The largest increase was capital grants and contributions, which increased as a result of a $778,477 contribution from the Orono School District to reimburse the City for costs incurred to repair and improve parking lots and other portions of capital assets belonging to the school district which were completed in conjunction with the City's project on Old Crystal Bay Road. Governmental Activities 2018 2017 Annual Change % Change REVENUES Program Revenues: Charges for Services $ 4,645,027 $ 4,091,124 $ 553,903 13.54 % Operating Grants and Contributions 1,741,370 1,174,782 566,588 48.23 Capital Grants and Contributions 820,165 609 819,556 134,574.06 General Revenues: Property Taxes 5,510,133 5,268,854 241,279 4.58 Unrestricted Investment Earnings 132,799 114,356 18,443 16.13 Gain on Sale of Capital Assets - 38,738 (38,738) (100.00) Other 193,279 53,207 140,072 263.26 Total Revenue 13,042,773 10,741,670 2,301,103 21.42 EXPENSES General Government 1,947,411 2,722,779 (775,368) (28.48) Public Safety 5,661,624 5,486,330 175,294 3.20 Streets 2,131,198 393,354 1,737,844 441.80 Parks and Recreation 465,170 420,410 44,760 10.65 Interest on Long -Term Debt 155,122 173,552 (18,430) (10.62) Total Expenses 10,360,525 9,196,425 1,164,100 12.66 CHANGE IN NET POSITION BEFORE TRANSFERS 2,682,248 1,545,245 1,137,003 73.58 Transfers (41,000) 155,000 (196,000) (126.45) CHANGE IN NET POSITION 2,641,248 1,700,245 941,003 55.35 Net Position - Beginning of Year 23,613,262 21,913,017 1,700,245 7.76 Prior Period Adjustment - See Note 12 (289,328) - (289,328) Net Position - Beginning of Year, as Restated 23,323,934 21,913,017 1,410,917 6.44 NET POSITION - END OF YEAR $ 25,965,182 $ 23,613,262 $ 2,351,920 9.96 Overall revenues increased 21.42% between 2017 and 2018. The largest increase was capital grants and contributions, which increased as a result of a $778,477 contribution from the Orono School District to reimburse the City for costs incurred to repair and improve parking lots and other portions of capital assets belonging to the school district which were completed in conjunction with the City's project on Old Crystal Bay Road. CITY OF ORONO, MINNESOTA MANAGEMENT'S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2018 The following is a summary of the City's change in Business -type net position: The business -type activities showed an increase in revenues of 5.56%, mainly due to slight increases in charges for services in the Water, Sewer, and Storm Water funds, mostly due to slight increases in rates as well as usage increases of around 2% in both the Sewer and Storm Water funds. Expenses also increased 5.81 %, largely as a result of increased personnel and water tower repairs costs in the Water fund. Business -Type Activities 2018 2017 Annual Change % Change REVENUES Program Revenues: Charges for Services $ 2,814,263 $ 2,544,429 $ 269,834 10.60 % Operating Grants and Contributions 34,500 - 34,500 N/A Capital Grants and Contributions 7,400 45,218 (37,818) (83.63) General Revenues: Unrestricted Investment Earnings 51,588 54,443 (2,855) (5.24) Unrestricted Interest Income on Special Assessments 2,733 30,830 (28,097) (91.14) Other 76,950 155,079 (78,129) (50.38) Total Revenue 2,987,434 2,829,999 157,435 5.56 EXPENSES Water Operating 915,730 680,595 235,135 34.55 Sewer Operating 1,381,752 1,429,209 (47,457) (3.32) Storm Water Operating 143,194 190,935 (47,741) (25.00) Recycling 127,044 126,333 711 0.56 Cable Television 51,943 48,684 3,259 6.69 Total Expenses 2,619,663 2,475,756 143,907 5.81 CHANGE IN NET POSITION BEFORE TRANSFERS 367,771 354,243 13,528 3.82 Transfers 41,000 (155,000) 196,000 (126.45) CHANGE IN NET POSITION 408,771 199,243 209,528 105.16 Net Position - Beginning of Year 22,628,017 22,428,774 199,243 0.89 Prior Period Adjustment - See Note 12 (32,627) - (32,627) Net Position - Beginning of Year, as Restated 22,595,390 22,428,774 166,616 0.74 NET POSITION - END OF YEAR $ 23,004,161 $ 22,628,017 $ 376,144 1.66 The business -type activities showed an increase in revenues of 5.56%, mainly due to slight increases in charges for services in the Water, Sewer, and Storm Water funds, mostly due to slight increases in rates as well as usage increases of around 2% in both the Sewer and Storm Water funds. Expenses also increased 5.81 %, largely as a result of increased personnel and water tower repairs costs in the Water fund. CITY OF ORONO, MINNESOTA MANAGEMENT'S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2018 Governmental Activities The graphs showing the governmental activities and their income clearly reflect the need for property taxes to supplement the activities of the City. Under the state's current local government aid formula the City will receive no local government aid. Propertyl 42% Capital Grar Contributions 6% Gain on Sale of Ca pital Unrestricted n«art ges for Services 36% )e ra ti ng Grants and Contributions 13% • Charges for Services • Operating Grants and Contributions • Capital Grants and Contributions • Property Taxes • Unrestricted Investment Earnings • Gain on Sale of Capital Assets Other Business -Type Activities The Sewer, Stormwater, and Cable Television funds experienced operating profits in the current year while the Water and Recycling funds recorded operating losses. Water rates are continuing to be increased based on the updated utility rate study, with the goal of producing a positive operating income in the future. All of the enterprise funds experienced net profits when nonoperating revenues are included. Utility rates continue to be set based on the utility rate study that was updated in 2013. The graph below represents the makeup of the Business -Type Activities Revenues. Ca pital Grants and Unrestricted Unrestricted Interest Contributions I nvestment Ea rnings Income on Special Other 0% 2% Assessments - 3% Operating Grants a nd 0% Contributions 1% Charges for Services 94% • Charges for Services • Operating Grants and Contributions Capital Grants and Contributions • Unrestricted Investment Earnings • Unrestricted Interest Income on Special Assessments • Other CITY OF ORONO, MINNESOTA MANAGEMENT'S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2018 General Fund The General Fund is the main operating fund of the City. Its primary revenue source in 2018 was property taxes at 48.4% of the total revenue, followed by user fees at 36.2°/x. The total fund balance increased by $7,730 during the current fiscal year. Expenditures were $238,668 over budget for the year. However, revenues were also over budget by $659,905. Additional user fees and licenses and permits revenue resulted in higher than normal expenses related to those fees during the year. The unassigned fund balance of $4,336,396 at the end of 2018 represents 53.9% of total General Fund expenditures for the year. Proprietary Funds The City's enterprise funds had a combined net position balance of $22,906,188 at December 31, 2018. The financial activities of these funds have been summarized in previous charts within this discussion. Capital Assets The City's investment in capital assets (net of accumulated depreciation) for its governmental and business -type activities as of December 31, 2018 is as follows: Land Construction in Progress Buildings and Building Improvements Improvements Other than Buildings Streets and Infrastructure Distribution/Collection Systems Equipment and Furniture Total Capital Assets Less: Accumulated Depreciation Total Capital Assets, Net Governmental Activities Business -Type Activities Total 2018 2017 2018 2017 2018 2017 $ 7,337,435 $ 7,337,435 $ 79,706 $ 79,706 $ 7,417,141 $ 7,417,141 3,946,328 3,255,918 1,127,199 607,731 5,073,527 3,863,649 9,160,345 9,160,345 1,605,211 1,605,211 10,765,556 10,765,556 2,633,048 2,373,988 13,511 13,511 2,646,559 2,387,499 10,362,353 7,164,359 - - 10,362,353 7,164,359 - - 25,739,802 24,849,760 25,739,802 24,849,760 4,643,003 4,256,047 963,292 924,164 5,606,295 5,180,211 38,082,512 33,548,092 29,528,721 28,080,083 67,611,233 61,628,175 (7,881,325) (7,266,859) (10,630,670) (10,077,679) (18,511,995) (17,344,538) $ 30,201,187 $ 26,281,233 $ 18,898,051 $ 18,002,404 $ 49,099,238 $ 44,283,637 The City has completed the development of a Capital Improvement Plan (CIP) that was formally adopted by the City Council. This plan will be reviewed annually as part of the budget process. The approved purchase of an asset management program will improve the City's ability to track useful and identify maintenance concerns involving the City's infrastructure and assets. Additional details of capital asset activity for the year can be found in Note 4 of the notes to basic financial statements. CITY OF ORONO, MINNESOTA MANAGEMENT'S DISCUSSION AND ANALYSIS YEAR ENDED DECEMBER 31, 2018 Long -Term Liabilities The debt service funds account for the accumulation of resources to finance all of the City's general obligation bonds. The revenue sources for these funds include annual tax levies, special assessments, and transfers from other funds. At year-end, the total fund balance of these funds was $2,154,301. The following table summarized the City's long-term liabilities. Additional details of long-term debt activity for the year can be found in Note 5 of the notes to basic financial statements. General Fund Budgetary Highlights Detail of the General Fund original budget, final budget and actual revenues and expenditures can be found on page 56 of this report. While a few departments required budget adjustments, the City compensated for these increases with reductions in other departments The Departments that needed budget adjustments were Adminitration, Assessing, Law and Legal Services, Central Services and Police. The Central Services budget was over budget due to higher than anticipated software licensing fees and bank fees. While the Police Department was over budget to higher than budgeted special services. These services are billed to the entity that receives the service, so the overage is offset by increased revenues for the service provided. The overall General Fund ended the year with a favorable budget variance of $659,905 before other financing sources and uses. REQUESTS FOR INFORMATION Questions concerning any of the information provided in this report or requests for additional information should be addressed by writing to the City of Orono, 2750 Kelley Parkway, P.O. Box 66, Crystal Bay, Minnesota 55323 or by calling (952) 249-4600. (17) Governmental Activities Business -Type Activities Total 2018 2017 2018 2017 2018 2017 General Obligation Bonds $ 7,000,000 $ 7,660,000 $ 965,000 $ 1,045,000 $ 7,965,000 $ 8,705,000 Compensated Absences 538,319 497,359 38,995 38,001 577,314 535,360 Bond Premium (Discount), Net 169,801 195,751 15,586 17,072 185,387 212,823 Total Outstanding Debt$ 7,708,120 $ 8,353,110 $ 1,019,581 $ 1,100,073 $ 8,727,701 $ 9,453,183 Additional details of long-term debt activity for the year can be found in Note 5 of the notes to basic financial statements. General Fund Budgetary Highlights Detail of the General Fund original budget, final budget and actual revenues and expenditures can be found on page 56 of this report. While a few departments required budget adjustments, the City compensated for these increases with reductions in other departments The Departments that needed budget adjustments were Adminitration, Assessing, Law and Legal Services, Central Services and Police. The Central Services budget was over budget due to higher than anticipated software licensing fees and bank fees. While the Police Department was over budget to higher than budgeted special services. These services are billed to the entity that receives the service, so the overage is offset by increased revenues for the service provided. The overall General Fund ended the year with a favorable budget variance of $659,905 before other financing sources and uses. REQUESTS FOR INFORMATION Questions concerning any of the information provided in this report or requests for additional information should be addressed by writing to the City of Orono, 2750 Kelley Parkway, P.O. Box 66, Crystal Bay, Minnesota 55323 or by calling (952) 249-4600. (17) BASIC FINANCIAL STATEMENTS CITY OF ORONO STATEMENT OF NET POSITION DECEMBER 31, 2018 See accompanying Notes to Basic Financial Statements. (18) Primary Government Governmental Business -Type Activities Activities Total ASSETS Cash and Investments $ 10,595,718 $ 4,700,167 $ 15,295,885 Accounts Receivable 65,375 639,875 705,250 Property Taxes Receivable 72,172 - 72,172 Special Assessments Receivable 26,867 296,570 323,437 Accrued Interest Receivable 48,382 8,489 56,871 Internal Balances (97,973) 97,973 - Due from Other Governments 838,586 7,498 846,084 Inventories 3,494 6,566 10,060 Prepaid Items 121,024 46,988 168,012 Other Assets 3,812 - 3,812 Capital Assets: Nondepreciable: Land 7,337,435 79,706 7,417,141 Construction in Progress 3,946,328 1,127,199 5,073,527 Depreciable: Buildings and Building Improvements 9,160,345 1,605,211 10,765,556 Improvements Other than Buildings 2,633,048 13,511 2,646,559 Streets and Infrastructure 10,362,353 - 10,362,353 Distribution/Collection Systems - 25,739,802 25,739,802 Equipment and Furniture 4,643,003 963,292 5,606,295 Total Capital Assets 38,082,512 29,528,721 67,611,233 Less: Accumulated Depreciation (7,881,325) (10,630,670) (18,511,995) Total Capital Assets, Net 30,201,187 18,898,051 49,099,238 Total Assets 41,878,644 24,702,177 66,580,821 DEFERRED OUTFLOWS OF RESOURCES Deferred Outflows - Pensions 3,419,531 60,837 3,480,368 Deferred Outflows - OPEB 18,834 1,926 20,760 Total Deferred Outflows of Resources 3,438,365 62,763 3,501,128 LIABILITIES Accounts and Contracts Payable 519,813 156,476 676,289 Accrued Salaries and Fringes 212,231 20,272 232,503 Accrued Interest Payable 73,036 9,513 82,549 Deposits 1,552,074 7,000 1,559,074 Unearned Revenue 20,056 15,770 35,826 Due to Other Governmental Units 216,645 23,004 239,649 Compensated Absences - Due Within One Year 315,000 17,000 332,000 Bonds Payable - Due Within One Year 910,950 81,485 992,435 Long -Term Liabilities: Other Postemployment Benefits Payable 759,500 77,687 837,187 Net Pension Liability 3,390,436 342,744 3,733,180 Compensated Absences - Due in More Than One Year 223,319 21,995 245,314 Bonds Payable - Due in More Than One Year 6,258,851 899,101 7,157,952 Total Liabilities 14,451,911 1,672,047 16,123,958 DEFERRED INFLOWS OF RESOURCES Deferred Inflows of Resources - Pensions 4,899,916 88,732 4,988,648 NET POSITION Net Investment in Capital Assets 23,370,988 17,917,465 41,288,453 Restricted for: Debt Service 2,098,665 - 2,098,665 Golf Course Improvements 270 270 Park Improvements 696,178 696,178 Drug and Alcohol Law Enforcement 334,952 334,952 Home Buyer Purchase Assistance Program 133,693 133,693 Lurton Park Development and Maintenance 17,624 17,624 Senior Housing TIF 153,036 - 153,036 Unrestricted (840,224) 5,086,696 4,246,472 Total Net Position $ 25,965,182 $ 23,004,161 $ 48,969,343 See accompanying Notes to Basic Financial Statements. (18) CITY OF ORONO STATEMENT OF ACTIVITIES YEAR ENDED DECEMBER 31, 2018 See accompanying Notes to Basic Financial Statements. (19) Program Revenues Net (Expense) Revenue and Changes in Net Position Primary Government Operating Charges for Grants and Capital Grants and Governmental Business -Type Functions/Programs Expenses Services Contributions Contributions Activities Activities Total Primary Government: Governmental Activities: General Government $ 1,947,411 $ 1,147,449 $ 159,512 $ 20,779 $ (619,671) $ - $ (619,671) Public Safety 5,661,624 3,102,546 396,593 - (2,162,485) - (2,162,485) Streets 2,131,198 5,826 1,185,265 799,386 (140,721) - (140,721) Parks and Recreation 465,170 389,206 - - (75,964) - (75,964) Interest and Fiscal Charges 155,122 - - - (155,122) - (155,122) Total Governmental Activities 10,360,525 4,645,027 1,741,370 820,165 (3,153,963) - (3,153,963) Business -Type Activities: Water Operating 915,730 699,562 - 5,315 (210,853) (210,853) Sewer Operating 1,381,752 1,477,225 - 2,085 97,558 97,558 Storm Water 143,194 421,838 34,500 - 313,144 313,144 Recycling 127,044 136,922 - 9,878 9,878 Cable Television 51,943 78,716 - - 26,773 26,773 Total Business -Type Activities 2,619,663 2,814,263 34,500 7,400 236,500 236,500 Total Primary Government $ 12,980,188 $ 7,459,290 $ 1,775,870 $ 827,565 (3,153,963) 236,500 (2,917,463) GENERAL REVENUES Property Taxes, Levied for General Purposes 5,510,133 - 5,510,133 Unrestricted Investment Earnings 132,799 51,588 184,387 Unrestricted Interest Income on Special Assessments - 2,733 2,733 Miscellaneous 193,279 76,950 270,229 TRANSFERS (41,000) 41,000 - Total General Revenues and Transfers 5,795,211 172,271 5,967,482 CHANGE IN NET POSITION 2,641,248 408,771 3,050,019 Net Position - Beginning of Year 23,613,262 22,628,017 46,241,279 Prior Period Restatement - See Note 12 (289,328) (32,627) (321,955) Net Position - Beginning, as Restated 23,323,934 22,595,390 45,919,324 NET POSITION - ENDING OF YEAR $ 25,965,182 $ 23,004,161 $ 48,969,343 See accompanying Notes to Basic Financial Statements. (19) CITY OF ORONO BALANCE SHEET GOVERNMENTALFUNDS DECEMBER 31, 2018 Municipal Pavement General State Aid Management Fund Street Plan ASSETS Other Governmental Funds Totals Cash and Investments $ 3,544,098 $ $ 259,972 $ 5,995,026 $ 9,799,096 Receivables: Miscellaneous Receivables 65,375 - - 65,375 Accrued Interest 39,787 176 6,944 46,907 Delinquent Taxes 50,349 4,423 17,400 72,172 Deferred Special Assessments - - 26,867 26,867 Prepaids 114,676 - 114,676 Inventory 3,494 3,494 Due from Other Funds 2,675,998 - - 2,675,998 Due from Other Governmental Units 49,996 778,477 3,300 6,813 838,586 Other Assets 3,812 - - - 3,812 Total Assets $ 6,547,585 $ 778,477 $ 267,871 $ 6,053,050 $ 13,646,983 LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCE LIABILITIES Accounts and Contracts Payable $ 163,491 $ 161,075 $ 165,011 $ 9,516 $ 499,093 Accrued Salaries Payable 212,231 - - - 212,231 Due to Other Funds - 2,536,494 139,504 - 2,675,998 Due to Other Governmental Units 114,874 1,038 - 100,733 216,645 Deposits 1,552,074 - - - 1,552,074 Unearned Revenue - - 20,056 20,056 Total Liabilities 2,042,670 2,698,607 324,571 110,249 5,176,097 DEFERRED INFLOWS OF RESOURCES Unavailable Revenue - Taxes 50,349 - 4,423 17,400 72,172 Unavailable Revenue - Special Assessments - - - 26,867 26,867 Unavailable Revenue - Other - 778,477 - - 778,477 Total Deferred Inflows of Resources 50,349 778,477 4,423 44,267 877,516 FUND BALANCE Nonspendable: Prepaids 114,676 - - - 114,676 Inventory 3,494 - 3,494 Restricted: Debt Service - 2,154,301 2,154,301 Parkland Acquisitions and Improvement 695,544 695,544 Drug and Alcohol Law Enforcement 334,700 334,700 Home Buyer Purchase Assistance 133,585 133,585 Lurton Park Development and Maintenance 17,640 17,640 Senior Housing 152,971 152,971 Golf Course Improvements 270 270 Big Island Improvements 6,000 6,000 Other Improvements 165 165 Assigned: Long Lake Fire Equipment 316,138 316,138 Capital Equipment Purchases 213,307 213,307 Police Equipment Purchases 299,383 299,383 Future Construction Projects 959,044 959,044 Community -Wide Projects 544,894 544,894 Debt Service 45,709 45,709 Police Garage Project - 24,883 24,883 Unassigned 4,336,396 (2,698,607) (61,123) - 1,576,666 Total Fund Balance 4,454,566 (2,698,607) (61,123) 5,898,534 7,593,370 Total Liabilities, Deferred Inflows of Resources, and Fund Balance $ 6,547,585 $ 778,477 $ 267,871 $ 6,053,050 $ 13,646,983 See accompanying Notes to Basic Financial Statements. (20) CITY OF ORONO RECONCILIATION OF THE BALANCE SHEET TO THE STATEMENT OF NET POSITION GOVERNMENTAL ACTIVITIES DECEMBER 31, 2018 Total Fund Balances for Governmental Funds Total net position reported for governmental activities in the statement of net position is different because: Capital assets used in governmental funds are not financial resources and, therefore, are not reported in the funds. Those assets consist of: Land Construction in Progress Buildings and Building Improvements Improvements Other than Buildings Streets and Infrastructure Equipment and Furniture Total Capital Assets Less: Accumulated Depreciation Some of the City's receivables, including property taxes, special assessments, and certain amounts due from other governments, will be collected after year-end, but are not available soon enoough to pay for the current period's expenditures and, therefore, are reported as deferred inflows of resources in the governmental funds. Interest on long-term debt is not accrued in governmental funds, but rather is recognized as an expenditure when due. Accrued interest for general obligation bonds is included in the statement of net position. The City's net pension liability and related deferred inflows and deferred outflows are recorded only on the statement of net position. Balances at year end are: Net Pension Liability Deferred Inflows of Resources - Pensions Deferred Outflows of Resources - Pensions The City's other postemployment benefits liability and related deferred inflows and deferred outflows and deferred outflows are recorded only on the statement of net position. Balances at year end are: Other Postemployment Benefits Liability Deferred Outflows of Resources - OPEB Long-term liabilities that pertain to governmental funds, including bonds payable, are not due and payable in the current period and, therefore, are not reported as fund liabilities. All liabilities - both current and long term - are reported in the statement of net position. Bonds Payable Unamortized Premiums Compensated Absence Payable Internal service funds are used by management to charge the costs of employee benefits and vehicle maintenance to individual funds. The assets and liabilities of the internal service funds are included in governmental activities in the statement of net position. Total Net Position of Governmental Activities See accompanying Notes to Basic Financial Statements. (21) 7,593,370 $ 7,337,435 3,946,328 9,160,345 2,633,048 10,362,353 4,643,003 38,082,512 (7,881,325) 30,201,187 877,516 (73,036) (3,390,436) (4,899,916) 3,419,531 (4,870,821) (759,500) 18,834 (7,000,000) (169,801) (538,319) (740,666) (7,708,120) 685,752 $ 25,965,182 CITY OF ORONO STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS YEAR ENDED DECEMBER 31, 2018 REVENUE Property Taxes Special Assessments Licenses and Permits Intergovernmental Revenue Fines and Forfeitures Other Revenue: Investment Earnings User Fees Rents and Refunds Miscellaneous Revenue Total Revenue EXPENDITURES Current: General Government Public Safety Streets Parks and Recreation Capital Outlay: Other Debt Service: Principal Retirement Interest and Fiscal Charges Total Expenditures EXCESS (DEFICIENCY) OF REVENUE OVER (UNDER) EXPENDITURES OTHER FINANCE SOURCES (USES) Transfers In Transfers Out Proceeds from Sale of Capital Assets Total Other Finance Sources (Uses) NET CHANGE IN FUND BALANCES FUND BALANCES Beginning of Year End of Year See accompanying Notes to Basic Financial Statements. (22) Municipal Pavement Other General State Aid Management Governmental Fund Street Plan Funds Totals $ 4,288,106 $ $ 380,336 $ 779,796 $ 5,448,238 - - 22,935 22,935 746,043 208,235 954,278 411,648 1,041,802 163,133 1,616,583 83,875 - - 40,185 124,060 70,155 4,012 48,492 122,659 3,211,749 - - 3,211,749 5,400 - - 5,400 47,429 - 117,160 1,230 165,819 8,864,405 1,041,802 501,508 1,264,006 11,671,721 1,429,086 - - 3,990 1,433,076 5,625,892 2,194 5,628,086 595,740 - 595,740 401,351 - - 20,645 421,996 - 2,689,450 1,700,231 1,382,138 5,771,819 - - 660,000 660,000 - - - 187,404 187,404 8,052,069 2,689,450 1,700,231 2,256,371 14,698,121 812,336 (1,647,648) (1,198,723) (992,365) (3,026,400) - 760,005 726,302 1,486,307 (837,703) - (379,604) (1,217,307) 33,097 - - 33,097 (804,606) 760,005 346,698 302,097 7,730 (1,647,648) (438,718) (645,667) (2,724,303) 4,446,836 (1,050,959) 377,595 6,544,201 10,317,673 $ 4,454,566 $ (2,698,607) $ (61,123) $ 5,898,534 $ 7,593,370 See accompanying Notes to Basic Financial Statements. (22) CITY OF ORONO RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES GOVERNMENTAL ACTIVITIES YEAR ENDED DECEMBER 31, 2018 Net Change in Fund Balances -Total Governmental Funds $ (2,724,303) Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures and proceeds from sale of capital assets as revenues. However, in the statement of activities, assets are capitalized and the cost is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which depreciation exceeded capital outlays in the current period. Capital Outlays - Improvement Costs (Net of Proceeds) $ 4,827,981 Gain (Loss) on Disposal of Capital Assets (831) Proceeds from the Sale of Capital Assets (33,097) Depreciation Expense (874,099) 3,919,954 The governmental funds report bond proceeds as financing sources, while repayment of bond principal is reported as an expenditure. In the statement of net position, however, issuing debt increases long-term liabilities and does not affect the statement of activities and repayment of principal reduces the liability. Interest is recognized as an expenditure in the governmental funds when it is due. In the statement of activities, however, interest expense is recognized as it accrues, regardless of when it is due. The net effect of these differences in the treatment of general obligation bonds and related items is as follows: Amortization of Bond Premium 25,950 Repayment of Bond Principal 660,000 Change in Accrued Interest Expense 6,332 692,282 Delinquent and certain other property taxes and special assessments receivable will be collected subsequent to year-end, but are not available soon enough to pay fo the current period's expenditures and, therefore, are reported as deferred inflows of resources and excluded from revenues in the governmental funds. Deferred Inflows of Resources - December 31, 2017 18,391 Deferred Inflows of Resources - December 31, 2018 877,516 859,125 In the statement of activities compensated absences and other postemployment benefits (113,722) are measured by the amounts earned during the year. In the governmental funds, however, expenditures for these items are measured by the amount of financial resources used (essentially, the amounts actually paid). Pension expenditures in the governmental funds are measured by current year employee 212,352 contributions. Pension expenses on the statement of activities are measured by the change in net pension liability and the related deferred inflows and outflows of resources. Internal service funds are used by the City to charge the costs of insurance to individual funds. The net revenue of the Internal Service Funds is reported with governmental activities. (204,440) Change in Net Position of Governmental Activities $ 2,641,248 See accompanying Notes to Basic Financial Statements. (23) CITY OF ORONO STATEMENT OF NET POSITION PROPRIETARY FUNDS DECEMBER 31, 2018 See accompanying Notes to Basic Financial Statements. (24) Governmental Business -Type Activities Activities Other Water Sewer Storm Business -Type Internal Operating Operating Water Activities Totals Service ASSETS AND DEFERRED OUTFLOWS OF RESOURCES CURRENT ASSETS Cash and Cash Equivalents $ 610,690 $ 2,578,240 $ 1,293,814 $ 217,423 $ 4,700,167 $ 796,622 Receivables: Accounts Receivables (Net of Allowance) 152,014 383,853 61,052 42,956 639,875 - Accrued Interest 664 5,017 2,507 301 8,489 1,475 Delinquent Special Assessments 1,968 21,860 - - 23,828 - Special Assessments 49,248 223,494 272,742 - Prepaids 583 46,405 46,988 6,348 Inventory 6,566 - 6,566 - Due from Other Governmental Units - 7,498 7,498 - Total Current Assets 821,733 3,266,367 1,357,373 260,680 5,706,153 804,445 CAPITAL ASSETS Land and Land Improvements 62,195 24,654 6,368 - 93,217 - Construction in Progress 323,128 211,160 592,911 1,127,199 Buildings and Improvements 1,572,243 32,968 - 1,605,211 Equipment 100,444 538,304 245,870 78,674 963,292 Distribution/Collection System 5,622,425 18,518,437 1,598,940 25,739,802 Total 7,680,435 19,325,523 2,444,089 78,674 29,528,721 Less: Accumulated Depreciation (2,728,464) (7,629,541) (254,835) (17,830) (10,630,670) Net Capital Assets 4,951,971 11,695,982 2,189,254 60,844 18,898,051 - Total Assets 5,773,704 14,962,349 3,546,627 321,524 24,604,204 804,445 DEFERRED OUTFLOWS OF RESOURCES Deferred Outflows - Pensions 20,490 32,629 5,027 2,691 60,837 - Defered Outflows - OPEB 850 903 173 1,926 Total Deferred Outflows of Resources 21,340 33,532 5,200 2,691 62,763 LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND NET POSITION CURRENT LIABILITIES Accounts and Contracts Payable 30,108 41,166 85,202 156,476 20,720 Accrued Salaries Payable 9,413 9,067 1,792 20,272 - Due to Other Governmental Units 10,222 12,782 - 23,004 Deposits 7,000 - 7,000 Compensated Absences Payable 8,029 13,966 21,995 Unearned Revenue - 15,770 15,770 Accrued Interest Payable 9,513 - 9,513 Current Maturities of Long -Term Debt 81,485 - 81,485 - Total Current Liabilities 155,770 92,751 86,994 335,515 20,720 NONCURRENT LIABILITIES Bonds Payable 899,101 - - 899,101 - Other Postemployment Benefits 34,276 36,419 6,992 77,687 Net Pension Liability 115,440 183,824 28;321 15,159 342,744 Compensated Absences Payable 6,166 10,834 17,000 Total Noncurrent Liabilities 1,054,983 231,077 35,313 15,159 1,336,532 Total Liabilities 1,210,753 323,828 122,307 15,159 1,672,047 20,720 DEFERRED INFLOWS OF RESOURCES Deferred Inflows - Pensions 29,885 47,590 7,332 3,925 88,732 - NET POSITION Net Investment in Capital Assets 3,971,385 11,695,982 2,189,254 60,844 17,917,465 - Unrestricted 583,021 2,928,481 1,232,934 244,287 4,988,723 783,725 Total Net Position $ 4,554,406 $ 14,624,463 $ 3,422,188 $ 305,131 22,906,188 $ 783,725 Total Liabilities and Balance $ 5,795,044 $ 14,995,881 $ 3,551,827 $ 324,215 24,666,967 $ 804,445 Some amounts reported for business -type activities in the statement of net position are different because certain internal service fund assets and liabilities are included with business -type activities 97,973 $ 23,004,161 See accompanying Notes to Basic Financial Statements. (24) CITY OF ORONO STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION PROPRIETARY FUNDS YEAR ENDED DECEMBER 31, 2018 See accompanying Notes to Basic Financial Statements. (25) Governmental Business -Type Activities Activities Other Water Sewer Storm Business -Type Internal Operating Operating Water Activities Totals Service OPERATING REVENUE Sales and User Fees $ 688,671 $ 1,472,125 $ 320,948 $ 190,165 $ 2,671,909 $ 335,071 Other - 25,845 1,586 27,431 166,716 Total Operating Revenue 688,671 1,497,970 320,948 191,751 2,699,340 501,787 OPERATING EXPENSES Personnel Services 234,282 271,498 46,374 20,796 572,950 12,120 Professional Services 22,910 13,494 16,936 140,620 193,960 - Operating and Maintenance Supplies 46,301 12,753 1,262 - 60,316 Utilities 86,814 33,737 - - 120,551 Depreciation 186,566 315,278 46,257 4,890 552,991 - Maintenance and Repairs 158,917 132,760 9,136 2,830 303,643 131,926 Administrative Charges from the General Fund 16,000 32,000 16,000 - 64,000 - Insurance 10,280 18,930 720 - 29,930 338,241 Other Expenses 56,260 551,302 6,509 9,851 623,922 - Total Operating Expenses 818,330 1,381,752 143,194 178,987 2,522,263 482,287 OPERATING INCOME (LOSS) (129,659) 116,218 177,754 12,764 177,077 19,500 NONOPERATING REVENUE (EXPENSES) Water Tower Rental Fee 19,370 - - - 19,370 - Connection Fee - 5,100 100,890 - 105,990 - Investment Earnings 6,932 25,794 16,843 2,019 51,588 10,140 Interest Expense (21,480) - - - (21,480) - State Grant - - 34,500 23,887 58,387 Miscellaneous Revenue 30,573 8,635 1,763 4,388 45,359 - Total Nonoperating Revenue 35,395 39,529 153,996 30,294 259,214 10,140 INCOME (LOSS) BEFORE CONTRIBUTIONS AND TRANSFERS (94,264) 155,747 331,750 43,058 436,291 29,640 Capital Contributions 5,315 2,085 - - 7,400 - Transfers In 206,000 - 206,000 Transfers Out (55,000) (110,000) (165,000) (310,000) Total Contributions and Transfers 156,315 (107,915) - - 48,400 (310,000) CHANGES IN NET POSITION 62,051 47,832 331,750 43,058 484,691 (280,360) NET POSITION Beginning of Year 4,509,873 14,589,840 3,092,338 262,073 1,064,085 Prior Period Restatement, See Note 11 (17,518) (13,209) (1,900) - - Beginning of Year, as Restated 4,492,355 14,576,631 3,090,438 262,073 1,064,085 End of Year $ 4,554,406 $ 14,624,463 $ 3,422,188 $ 305,131 $ 783,725 Adjustment to Reflect the Consolidation of Internal Service Fund Activities Related to Enterprise Funds (73,131) Change in Net Position of Business -Type Activities (page 20) $ 411,560 See accompanying Notes to Basic Financial Statements. (25) CITY OF ORONO STATEMENT OF CASH FLOWS PROPRIETARY FUNDS YEAR ENDED DECEMBER 31, 2018 OPERATING INCOME CASH FLOWS FROM OPERATING ACTIVITIES Cash Receipts from Customers Cash Paid to Suppliers Cash Paid to Employees Other Receipts Net Cash Provided (Used) by Operating Activities CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Water Tower Rental Fees Connection Fees Received Special Assessments for Capital Purposes Acquisition of Capital Assets Interest Paid on Bonds Principal Payments on Bonds Net Cash Used by Capital and Related Financing Activities CASH FLOWS FROM INVESTING ACTIVITIES Interest Received CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Net Transfers State Grant Received Net Cash Provided (Used) by Noncapital Financing Activities NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS Cash and Cash Equivalents - Beginning of Year CASH AND CASH EQUIVALENTS - END OF YEAR RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES Operating Income (Loss) Miscellaneous Other Receipts Added to Operating Income Noncash Expenses Included in Net Income: Depreciation Change in Assets and Liabilities: (Increase) Decrease in: Accounts Receivable Prepaid Items Inventory Due from Other Governmental Units Deferred Outflows of Resources Increase (Decrease) in: Accounts Payable Accrued Salaries Payable Due to Other Governmental Units Compensated Absences Payable Other Postemployment Benefits Net Pension Liability Deferred Inflows of Resources Net Cash Provided (Used) by Operating Activities See accompanying Notes to Basic Financial Statements. (26) Governmental Business -Type Activities - Enterprise Funds Activities Other Enterprise Water Sewer Storm Water Funds Total Internal Service $ 637,583 $ 1,509,329 $ 316,098 $ 187,666 $ 2,650,676 $ 335,071 (487,395) (1,062,786) 9,591 (154,091) (1,694,681) (461,078) (232,394) (275,552) (46,638) (21,425) (576,009) (12,120) 30,573 34,480 1,763 5,974 72,790 174,396 (51,633) 205,471 280,814 18,124 452,776 36,269 19,370 - - - 19,370 - - 5,100 100,890 105,990 5,315 2,085 - 7,400 (314,754) (326,004) (778,104) (29,776) (1,448,638) (23,631) (23,631) (80,000) (80,000) (393,700) (318,819) (677,214) (29,776) (1,419,509) - 6,932 22,744 15,449 1,838 46,963 9,305 151,000 (110,000) - - 41,000 (310,000) 34,500 23,887 58,387 151,000 (110,000) 34,500 23,887 99,387 (310,000) (287,401) (200,604) (346,451) 14,073 (820,383) (264,426) 898,091 2,778,844 1,640,265 203,350 5,520,550 1,061,048 $ 610,690 $ 2,578,240 $ 1,293,814 $ 217,423 $ 4,700,167 $ 796,622 $ (129,659) $ 116,218 $ 177,754 $ 12,764 $ 177,077 $ 19,500 30,573 8,635 1,763 4,388 45,359 - 186,566 315,278 46,257 4,890 552,991 - (14,808) 40,380 (4,850) (2,499) 18,223 7,680 (461) (46,283) (46,744) (6,348) 3,402 3,402 103 (3,176) (3,073) 11,003 17,970 2,735 1,555 33,263 - (72,795) (215,610) 60,527 (790) (228,668) 15,437 2,972 (518) 238 - 2,692 - (20,059) (5,917) (373) (26,349) 411 583 - 994 4,134 4,392 843 9,369 (17,852) (28,426) (4,380) (2,344) (53,002) 1,220 1,945 300 160 3,625 $ (51,633) $ 205,471 $ 280,814 $ 18,124 $ 452,776 $ 36,269 See accompanying Notes to Basic Financial Statements. (26) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. Organization The City of Orono, Minnesota (the City) operates under the "Optional Plan A" form of government as defined in Minnesota Statutes. Under this plan, the City Council, composed of an elected mayor and four elected trustees or council members, exercises legislative authority and determines all matters of policy. The City Administrator, appointed by the City Council, is responsible for the proper administering of all affairs relating to the City. The financial statements and the accounting policies of the City conform to accounting principles generally accepted in the United States of America as applicable to governmental units. B. Reporting Entity As required by accounting principles generally accepted in the United States of America, these financial statements include the City (the primary government) and its component unit. A component unit is a legally separate entity for which the primary government is financially accountable, or for which the exclusion of the component unit would render the financial statements of the primary government misleading. The criteria used to determine if the primary government is financially accountable for a component unit includes whether or not the primary government appoints the voting majority of the potential component unit's board, is able to impose its will on the potential component unit, is in a relationship of financial benefit or burden with the potential component unit, or is fiscally depended upon by the potential component unit. The Orono Housing and Redevelopment Authority (Orono HRA) is a legally separate organization created in accordance with Minnesota Statute § 469.003. Its purpose is to clear and redevelop blighted areas within the City and to provide adequate housing for low and moderate income residents. The Orono HRA is fiscally dependent upon the City, and its governing board consists of the City's mayor and council members. Therefore, the Orono HRA has been reported as a blended component unit of the City, with its funds reported as though they are funds of the City. The financial activity at this time is limited to debt payments within the Orono HRA debt service funds, namely the public facilities and project revenue bonds. There are no other organizations that, when considered, would be included in the financial statements as a component unit. (27) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) C. Government -Wide Financial Statements The government -wide financial statements (statement of net position and statement of activities) display information about the reporting government as a whole. These statements include all of the financial 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 sales, 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. 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, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other internally directed revenues are reported as general revenues. The government -wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes and special assessments are recognized as revenues in the fiscal year for which they are levied. Grants and similar items are recognized when all eligibility requirements imposed by the provider have been met. As a general rule, the effect of interfund activity has been eliminated from the government -wide financial statements. However, charges between the City's enterprise funds and other functions are not eliminated, as that would distort the direct costs and program revenues reported in those functions. The City applies restricted resources first when an expense is incurred for which both restricted and unrestricted resources are available. Depreciation expense can be specifically identified by function (see Note 4). Interest on long-term debt is considered an indirect expense and is reported separately on the statement of activities. (28) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Fund Financial Statement Presentation Separate fund financial statements are provided for governmental and proprietary funds. Major individual governmental and enterprise funds are reported as separate columns in the fund financial statements. Aggregated information for the remaining nonmajor governmental funds is reported in a single column in the fund financial statements. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenue is recognized when it becomes measurable and available. "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. For this purpose, the City considers revenues to be available if collected within 60 days after year-end. Major revenue that is susceptible to accrual includes property taxes, intergovernmental revenue, charges for services, and interest earned on investments. 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. Revenue that is not susceptible to accrual includes licenses and permits, fees, and miscellaneous revenue. Such revenue is recorded only when received because it is not measurable until collected. Grants and similar items are recognized when all eligibility requirements imposed by the provider have been met. Expenditures are generally recorded when a liability is incurred, except for principal and interest on long-term debt and compensated absences, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as capital outlay expenditures in the governmental funds. Proceeds of long-term debt and acquisitions under capital leases are reported as other financing sources. Proprietary fund financial statements are reported using the economic resources measurement focus and accrual basis of accounting, similar to the government -wide financial statements. 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's enterprise funds and the Internal Service Funds are charges to customers for sales and services. The operating expenses for the enterprise funds and Internal Service 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. The Internal Service Funds are reported in the proprietary fund financial statements. Because the principal user of internal services is the City's governmental activities, the financial statements of the Internal Service Funds are consolidated into both the governmental activities and business -type activities columns when presented in the government -wide financial statements. The cost of these services is reported in the appropriate functional activity. (29) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Fund Financial Statement Presentation (Continued) Description of Funds The City reports the following major governmental funds: General Fund — This is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in another fund. Municipal State Aid Street — This fund is used to collect and spend resources on the various projects related to state aid streets and highways. Pavement Management Plan — This fund is used to collect and spend resources on the various road construction projects of the City. The City reports the following major enterprise funds: Water Operating Fund — This fund is used to account for the provision of water services to the residents of the City who have water service available. Sewer Operating Fund — This fund is used to account for the provision of sewer services to the residents of the City who have sanitary sewer service available. Storm Water Fund — This fund is used to account for the charges for and the costs of maintaining the City's storm water system. The City's proprietary funds also include the following: Internal Service Funds — Insurance, Compensated Absences, Fleet Management, and IT Services — These funds are used to account for the insurance costs incurred by the City for general liability, property, vehicle, workers' compensation, and other insurance and deductibles, the accrual of sick and vacation days that are earned by the City's employees, repairs and maintenance costs of the City's vehicles, and IT services provided to various City functions. These funds are reimbursed through charges to the various participating departments of the City. E. Cash and Investments Cash balances from all funds are combined and invested to the extent available in short- term investments. Earnings from the pooled investments are allocated to the individual funds based on the average monthly cash and investment balances of the respective funds. The City considers all highly liquid debt instruments with an original maturity from the time of purchase by the City of three months or less to be cash equivalents. The proprietary funds' portion in the government -wide cash and investment management pool is considered to be cash equivalent. Cash and investments held by trustee reflect balances held in segregated accounts for specific purposes. Interest earned on these investments is allocated directly to those accounts. (30) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) F. Receivables All miscellaneous accounts receivable are shown at net of an allowance for doubtful accounts. Since the City is generally able to certify delinquent utility bills to the county for collection as special assessments, no allowance for uncollectible accounts has been provided on those receivables. The only receivables not expected to be fully collected within one year are property taxes and special assessments receivable. G. Property Taxes Property tax levies are set by the City Council by December of each year, and certified to the County Auditor for collection in the following year. In Minnesota, counties act as collection agents for all property taxes. A portion of the property taxes levied may be paid by the state of Minnesota through various tax credits, which are included in intergovernmental revenue in the financial statements. The county spreads all levies over taxable property. Such taxes become a lien on January 1 and are recorded as receivables by the City on that date. Real property taxes may be paid by taxpayers in two equal installments on May 15 and October 15. Personal property taxes are due in full on May 15. The county provides tax settlements to cities and other taxing districts several times a year. Taxes which remain unpaid at December 31 are classified as delinquent taxes receivable. H. Special Assessments Special assessments represent the financing for public improvements paid for by the benefiting property owners. These assessments are recorded as delinquent (levied but unremitted) or deferred (certified but not yet levied) special assessments receivable. Prepaid Items Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government -wide and fund financial statements. The City utilizes the consumption method when recording prepaid items. J. Inventories The City's governmental funds utilize the consumption method for accounting for inventory and all inventories of the City are stated at the lower of cost or market on the first -in, first -out basis. K. Interfund Receivables and Payables Activity between funds that is representative of lending or borrowing arrangements is reported as either "due to/from other funds" (current portion) or "advances to/from other funds." All other outstanding balances between funds are reported as "due 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." (31) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) L. Capital Assets Capital assets, which include property, buildings, improvements, equipment, and infrastructure assets are reported in the applicable governmental or business -type activities columns in the government -wide financial statements. Such assets are capitalized at historical cost, or estimated historical cost for assets where actual historical cost is not available. Donated assets are recorded as capital assets at their acquisition value at the date of donation. The City defines capital assets as those with an initial, individual cost of $5,000 or more for government -wide and $5,000 for proprietary funds with an estimated useful life in excess of one year. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. As allowed by accounting principles generally accepted in the United States of America, the City has elected not to retroactively capitalize the infrastructure of its governmental activities acquired prior to January 1, 2004. Capital assets are recorded in the government -wide and proprietary fund financial statements, but are not reported in the governmental fund financial statements. Interest incurred during the construction phase of capital assets for business -type activities is included as part of the capitalized value of the assets constructed. Capital assets are depreciated using the straight-line method over their estimated useful lives. Land and construction in progress are not depreciated. Useful lives vary from 15 to 50 years for land improvements, buildings, and other improvements; 5 to 10 years for equipment; and 20 to 50 years for collection and distribution systems and other infrastructure. M. Compensated Absences Payable Certain City employees earn personal time off, vacation, compensation time, and sick leave at various rates based on longevity. These compensated absences are paid to an employee leaving in good standing, at their current rate of pay, with the exception of sick leave in which one-half is paid to the departing employee. Compensated absences payable are accounted for as long-term liabilities as described in the following section. N. Long -Term Liabilities In the government -wide and proprietary fund financial statements, long-term debt and other long-term obligations are reported as liabilities. Bond premiums and discounts are amortized over the life of the bonds using the straight-line method. In the governmental fund financial statements, long-term debt and other long-term obligations are not reported as liabilities. The face amount of debt issued is reported as other financing sources. Premiums or discounts on debt issuances are reported as other financing sources or uses, respectively. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. (32) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) O. Deferred Outflows of Resources and Deferred Inflows of Resources In addition to assets, the statements of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element 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 that time. The City has two types of items, deferred outflows related to pensions and deferred outflows related to OPEB, which qualify for reporting in this category. See Note 6 and Note 8 for additional details. In addition to liabilities, the statements of financial position or balance sheets will sometimes report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of net position that applies to future periods and so will not be recognized as an inflow of resources (revenue) until that time. The City has two types of items which qualify for reporting in this category. The first, unavailable revenue, arises under a modified accrual basis of accounting and is therefore reported only in the governmental funds balance sheet. The governmental funds report unavailable revenue from three sources: property taxes, special assessments, and amounts due from other governments not collected within 60 days of year-end. These amounts are deferred and recognized as an inflow of resources in the period the amounts become available. The City reports deferred inflows related to taxes collected in advance of levy, which are simply taxes prepaid to the City prior to being due by the citizens and businesses within the City. The City also reports deferred inflows related to pensions on its statements of net position. See Note 8 for additional detail. P. Net Position/Fund Balance Net position represents the difference between assets, deferred outflows of resources, liabilities, and deferred inflows of resources in the government -wide and proprietary fund financial statements. Net investment in capital assets consists of capital assets, net of accumulated depreciation, reduced by the outstanding balance of any long-term debt used to build or acquire the capital assets. Portions of net position are reported as restricted when there are limitations imposed on their use through external restrictions imposed by creditors, grantors, or laws or regulations of other governments. In the fund financial statements, governmental funds report fund balances in the classifications that disclose constraints for which amounts in those funds can be spent. These classifications are as follows: Nonspendable — portion of fund balances related to prepaids, inventories, long-term receivables, and corpus on any permanent fund. Restricted — funds are constrained from outside parties (statute, grantors, bond agreements, etc.). Committed — funds are established and modified by a resolution approved by the City Council. Assigned — consists of internally imposed constraints approved by the City Finance Director. The City adopted a formal fund balance policy which gives authority to assign fund balances to the Finance Director. (33) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) P. Net Position/Fund Balance (Continued) Unassigned — is the residual classification for the General Fund and also reflects the negative residual amounts in other funds. When an expenditure is incurred for purposes for which both restricted and unrestricted fund balance is available, it is the City's policy to use restricted first, then unrestricted fund balance. When an expenditure is incurred for purposes for which committed, assigned, and unassigned amounts are available, it is the City's policy to use committed first, than assigned, and finally unassigned amounts. The City formally adopted a fund balance policy for the General Fund. The policy establishes a year-end target unassigned fund balance of 45% of the fund's annual operating budget. Unassigned fund balance in excess of 50% will be transferred to the Community Investment Construction Fund pursuant to Council approval. Q. Budgets and Budgetary Accounting Each fall, after holding a meeting to obtain public comments, the City Council legally adopts the General Fund and any major special revenue funds. These budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America. The City has established budgetary control at the department level. City management must request City Council approval before exceeding the budget at that level. City management may transfer appropriations within the department level without City Council approval. Appropriations lapse at year-end; however, the City Council may approve the carryover of specific amounts. Encumbrance accounting is not used. R. 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; and natural disasters. The City participates in the League of Minnesota Cities Insurance Trust (LMCIT), a public entity risk pool for its general property and casualty, workers' compensation, and other miscellaneous insurance coverages. LMCIT operates as a common risk management and insurance program for a large number of cities in Minnesota. The City pays an annual premium to LMCIT for insurance coverage. The LMCIT agreement provides that the trust will be self- sustaining through member premiums and will reinsure through commercial companies for claims in excess of certain limits. The City also carries commercial insurance for certain other risks of loss. Settled claims resulting from these risks have not exceeded insurance coverage in any of the past three fiscal years. There were no significant reductions in insurance coverage in 2018. (34) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 2 DEPOSITS AND INVESTMENTS A. Components of Cash and Investments Cash and investments at year-end consisted of the following: Deposits Investments Cash on Hand Total $ 48,892 15,245,834 1,160 $ 15,295,886 Cash and investments are presented in the financial statements as follows: Cash and Investments - Statement of Net Position $ 15,295,885 B. Deposits In accordance with applicable Minnesota Statutes, the City maintains deposits at depository banks authorized by the City Council, including checking accounts and certificates of deposit. The following is considered the most significant risk associated with deposits: Custodial Credit Risk — In the case of deposits, this is the risk that in the event of a bank failure, the City's deposits may be lost. Minnesota Statutes require that all deposits be protected by federal deposit insurance, corporate surety bond, or collateral. The market value of collateral pledged must equal 110% of the deposits not covered by federal deposit insurance or corporate surety bonds. Authorized collateral includes treasury bills, notes, and bonds; issues of U.S. government agencies; general obligations rated "A" or better; revenue obligations rated "AX or better; irrevocable standard letters of credit issued by the Federal Home Loan Bank; and certificates of deposit. Minnesota Statutes require that securities pledged as collateral be held in safekeeping in a restricted account at the 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 City's investment policies further limit depositories to those located in the state of Minnesota, and must have a minimum capital and surplus of $10,000,000 and a net worth to asset ratio minimum of 5%, except for the City's main checking account at the First National Bank of the Lakes, Navarre. At year-end, the carrying amount of the City's deposits was $48,892 while the balance on the bank records was $194,698. At December 31, 2018, all deposits were fully covered by federal depository insurance, surety bonds, or by collateral held by the City's agent in the City's name. (35) NOTE 2 CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 DEPOSITS AND INVESTMENTS (CONTINUED) C. Investments The City has the following investments at year-end: Investments Measured at Fair Value Fair Value Negotiable Certificates of Deposit with Maturity at Purchase of Greater Than one Year $ 9,462,478 Federal Home Loan Bank 1,875,131 Federal Home Loan Mortgage Corp. 1,239,645 Federal National Mortgage Association 252,738 Municipal Bonds 814,717 Total Investments Measured at Fair Value $ 13,644,709 Amortized Investments Measured at Amortized Cost Cost Minnesota Municipal Money Market (4M) Fund $ 1,477,023 Other Money Markets 124,102 Total Assets Measured at Amortized Cost $ 1,601,125 Total Investments $ 15,245,834 Investments are subject to various risks, the following of which are considered the most significant: Custodial Credit Risk — For investments, this is the risk that in the event of a failure of the counterparty to an investment transaction (typically a broker-dealer) the City would not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. The City typically limits its exposure by purchasing insured or registered investments, or by the control of who holds the securities. City investment policies require that security/broker/dealers be restricted to those regulated by the Securities and Exchange Commission, have a minimum capital of $40,000,000 and may include "primary" dealers or regional dealers, and are located in Minnesota. The City limits the amount of investments with a specific dealer to 30% of the investment portfolio. (36) NOTE 2 CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 DEPOSITS AND INVESTMENTS (CONTINUED) C. Investments (Continued) Credit Risk — This is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. Minnesota Statutes limit the City's investments to direct obligations or obligations guaranteed by the United States or its agencies; shares of investment companies registered under the Federal Investment Company Act of 1940 that receive the highest credit rating, are rated in one of the two highest rating categories by a statistical rating agency, and all of the investments have a final maturity of 13 months or less; general obligations rated "A" or better; revenue obligations rated "AX or better; general obligations of the Minnesota Housing Finance Agency rated "A" or better; bankers' acceptances of United States banks eligible for purchase by the Federal Reserve System; commercial paper issued by United States corporations or their Canadian subsidiaries, rated of the highest quality category by at least two nationally recognized rating agencies, and maturing in 270 days or less; Guaranteed Investment Contracts guaranteed by a United States commercial bank, domestic branch of a foreign bank, or a United States insurance company, and with a credit quality in one of the top two highest categories; repurchase or reverse purchase 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; that are a primary reporting dealer in U.S. government securities to the Federal Reserve Bank of New York; or certain Minnesota securities broker-dealers. The City's investment policies do not allow investing in the following instruments: 1. Reverse repurchase agreements 2. Mortgage-backed securities, as defined in Minnesota Statute § 118A.04, Subd. 6 3. Future contracts 4. Options 5. Guaranteed investment contracts Interest Rate Risk — This is the risk of potential variability in the fair value of fixed rate investments resulting from changes in interest rates (the longer the period for which an interest rate is fixed, the greater the risk). The City's investment policy also provides a guideline that generally limits the duration of investments to a maturity of eight years, and 20% of the portfolio to a specific maturity. A schedule of the maturities and ratings of the City's investments as of December 31, 2018 is as follows: Interest- Risk: Maturity in Years Total Value Less than 1 1 t.2 2 to 5 5+ No Maturity Rating Negotiable Certificates of Deposit with Maturity at Time of Purchase of More Than One Year $ 9,462,478 $ 2,338,993 Federal Home Loan Bank 1,875,131 - Federal Home Loan Mortgage Corporation 1,239,645 - Federal National Mortgage Association 252,738 - Municipal Bonds 814,717 - Money Markets 11601,125 Total $ 15,245,834 $ 2,338,993 Deposits Held At Bank 50,052 Total $ 15,295,886 (37) $ 3,529,500 $ 3,593,985 $ - $ - AAA - 1,875,131 - - AA, 1,239,645 - - AA, - 252,738 - - AA, 496,105 318,612 - NR 1,601,125 NR $ 3,529,500 $ 7,457,604 $ 318,612 $ 1,601,125 CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 2 DEPOSITS AND INVESTMENTS (CONTINUED) C. Investments (Continued) Concentration Risk — This is the risk associated with investing a significant portion of the City's investment (considered 5% or more) in the securities of a single issuer, excluding U.S. guaranteed investments (such as treasuries), investment pools, and mutual funds. The City's investment policies provide a guideline of limiting investments to 35% of a specific type. At December 31, 2018, the following is a list of investments which individually comprise more than 5% of the City's total investments: Percent of Total Value MN Municipal Money Markets (4M) $ 1,601,125 10.5% Fair Value Measurements The City uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. The City follows an accounting standard which defines fair value, establishes framework for measuring fair value, establishes a fair value hierarchy based on the quality of inputs used to measure fair value, and requires expanded disclosures about fair value measurements. In accordance with this standard, the City has categorized its investments, based on the priority of inputs to the valuation technique, into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to quotes and prices in active markets for identical assets and liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. Financial assets and liabilities recorded on the combined statements of financial position are categorized based on the inputs to the valuation techniques as follows: Level 1 — Financial assets and liabilities are valued using inputs that are unadjusted quoted prices in active markets accessible at the measurement date of identical financial assets and liabilities. Level 2 — Financial assets and liabilities are valued based on quoted process for similar assets or inputs that are observable, either directly or indirectly, for substantially the full term through corroboration with observable market data. Level 3 — Financial assets and liabilities are valued using pricing inputs which are unobservable for the asset, inputs that reflect the reporting entity's own assumptions about the assumptions market participants would use in pricing the asset. (38) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 2 DEPOSITS AND INVESTMENTS (CONTINUED) C. Investments (Continued) Below is a categorization of the City's investments at December 31, 2018. Investment Type Negotiable Certificates of Deposit with Maturity at Purchase of Greater Than One Year Federal Home Loan Bank Federal Home Loan Mortgage Corp. Federal National Mortgage Association Municipal Bonds Total Amortized Cost Total Investments NOTE 3 INTERFUND TRANSFERS A. Interfund Transfers Level Level Level Total $ - $ 9,462,478 $ - $ 9,462,478 - 1,875,131 - 1,875,131 1,239,645 - 1,239,645 252,738 - 252,738 814,717 814,717 $ $ 13,644,709 $ 13,644,709 1,601,125 $ 15,245,834 From Fund To Fund Amount Purpose General Fund Improvement and Equipment $ 255,000 Budgeted operating transfer for Capital Outlay capital equipment purchases General Fund 2014 Improvement Bonds 125,000 Budgeted transfer for debt service of 2014 Improvement Bonds Water Operating 2016 GO Refunding Bond 55,000 Annual operating transfer for Water Debt Service Fund portion of the Casco Point Road Project Sewer Operating 2016 GO Refunding Bond 110,000 Annual operating transfer for Sewer Debt Service Fund portion of the Casco Point Road Project General Fund Pavement Management 450,000 2018 Fund Balance Transfer due to Excess over cap in the general fund. General Fund Lurton 7,703 Reimburse Lurton Park Fund for General Fund Purchases Park Fund Lurton 17,250 Reimburse Lurton Park Fund for Parking Lot Park Fund Lurton 24,098 Reimburse Lurton Park Fund for Saga Hill Work 2004 G.O. Imp Refunding Pavement Management 3 Close Fund 317 to Fund 435 Bond 2005 Hra Public Proj Rev 2005 Big Island Public Proj Fd 44,448 Close Fund 318 to Fund 430 Bond 2008 St Reconstruction 2016 GO Refunding Bond 87,803 Close Fund 319 to Fund 323 Bond Debt Service 2009 Refunding Bond Pavement Management 2 Close Fund 320 to Fund 435 2000 Improvement Bonds Water Fund 206,000 Insurance Fund Pavement Management 310,000 Insurance Fund Balance cap set $300,000. Transfer excess over cap to Pavement Management Fund for street projects. Total $ 1,692,307 Transfers are used to move resources from the funds in which they are collected to the funds where they are to be spent in accordance with statutory, budgetary, or contractual requirements. Transfers to the nonmajor governmental funds include funding for debt service, capital acquisitions, and improvements. (39) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 4 CAPITAL ASSETS A. Changes in Capital Assets Used in Governmental Activities Governmental Activities: Capital Assets, Not Being Depreciated: Land Construction in Progress Total Capital Assets, Not Being Depreciated Capital Assets, Being Depreciated: Buildings and Building Improvements Improvements Other than Buildings Equipment and Furniture Streets and Infrastructure Total Capital Assets, Being Depreciated Accumulated Depreciation for: Buildings and Building Improvements Improvements Other than Buildings Equipment and Furniture Streets and Infrastructure Total Accumulated Depreciation Total Capital Assets, Being Depreciated, Net Governmental Activities Capital Assets, Net Beginning Ending Balance Increases Decreases Balance $ 7,337,435 $ - $ - $ 7,337,435 3,255,918 4,809,980 4,119,570 3,946,328 10,593,353 4,809,980 4,119,570 11,283,763 9,160,345 - - 9,160,345 2,373,988 259,060 - 2,633,048 4,256,047 680,517 293,561 4,643,003 7,164,359 3,197,994 10,362,353 22,954,739 4,137,571 293,561 26,798,749 2,604,256 186,870 - 2,791,126 1,083,939 74,468 - 1,158,407 2,428,534 387,411 259,633 2,556,312 1,150,130 225,350 - 1,375,480 7,266,859 874,099 259,633 7,881,325 15,687,880 3,263,472 33,928 18,917,424 $ 26,281,233 $ 8,073,452 $ 4,153,498 $ 30,201,187 B. Changes in Capital Assets Used in Business -Type Activities Business -Type Activities: Capital Assets, Not Being Depreciated: Land Construction in Progress Total Capital Assets, Not Being Depreciated Capital Assets, Being Depreciated: Land Improvements Buildings and Building Improvements Equipment and Furniture Distribution/Collection System Total Capital Assets, Being Depreciated Accumulated Depreciation for: Land Improvements Buildings and Building Improvements Equipment and Furniture Distribution/Collection System Total Accumulated Depreciation Total Capital Assets, Being Depreciated, Net Business -Type Activities Capital Assets, Net Beginning Ending Balance Increases Decreases Balance $ 79,706 $ - $ - $ 79,706 607,731 1,240,320 720,852 1,127,199 687,437 1,240,320 720,852 1,206,905 13,511 - - 13,511 1,605,211 - 1,605,211 924,164 39,128 963,292 24,849,760 890,042 25,739,802 27,392,646 929,170 28,321,816 5,622 253 5,875 427,512 64,314 491,826 488,172 41,853 530,025 9,156,373 446,571 9,602,944 10,077,679 552,991 10,630,670 17,314,967 376,179 17,691,146 $ 18,002,404 $ 1,616,499 $ 720,852 $ 18,898,051 (40) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 4 CAPITAL ASSETS (CONTINUED) C. Depreciation Expense by Function Governmental Activities: General Government Public Safety Streets Parks and Recreation Total Depreciation Expense, Governmental Activities Business -Type Activities: Water Operating Sewer Operating Storm Water Cable Television Total Depreciation Expense, Business -Type Activities NOTE 5 LONG-TERM LIABILITIES $ 252,492 236,186 331,668 53,753 $ 874,099 $ 186,566 315,278 46,257 4,890 $ 552,991 A. Components of, and Changes in Long -Term Liabilities Beginning End of Due Within of Year Additions Retirements Year One Year Governmental Activities: General Obligation Bonds $ 7,660,000 $ $ (660,000) $ 7,000,000 $ 885,000 Unamortized Bond Premiums 195,751 (25,950) 169,801 25,950 Total Bonds Payable 7,855,751 (685,950) 7,169,801 910,950 Compensated Absences 497,359 363,044 (322,084) 538,319 315,000 Total Governmental Activities 8,353,110 363,044 (1,008,034) 7,708,120 1,225,950 Business -Type Activities: General Obligation Bonds 1,045,000 - (80,000) 965,000 80,000 Unamortized Bond Premiums 17,072 - (1,486) 15,586 1,485 Compensated Absences 38,001 19,781 (18,787) 38,995 17,000 Total Business -Type Activities 1,100,073 19,781 (100,273) 1,019,581 98,485 Total Debt $ 9,453,183 $ 382,825 $ (1,108,307) $ 8,727,701 $ 1,324,435 (41) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 5 LONG-TERM LIABILITIES (CONTINUED) B. Bonds Payable General Obligation Bonds — These bonds were issued to finance various improvements and will be repaid from taxes and special assessments. Minimum annual principal and interest payments required to retire general obligation bonds are as follows: Years 2019 2020 2021 2022 2023 2024-2028 2029-2033 Totals Governmental Activities (42) Bonds Payable Principal Interest $ 890,000 $ 165,363 925,000 145,113 945,000 124,238 960,000 102,822 990,000 78,394 2,015,000 169,269 275,000 4,125 $ 7,000,000 $ 789,324 Interest Final Maturity Balance - Description Original Issue Rate Issue Date Date End of Year Governmental Activities: General Obligation Bonds Payable: General Obligation Bonds of 2010A $ 4,315,000 3.00-3.75% 12/30/10 02/01/26 $ 1,845,000 General Obligation Bonds of 2014A 5,275,000 2.00-3.00% 06/19/14 02/01/29 2,685,000 Street Reconstruction Refunding Bonds of 2016A 2,680,000 2.00% 11/17/16 02/01/23 2,470,000 Total General Obligation Bonds Payable 7,000,000 Unamortized Bond Premium 169,801 Total Governmental Activities Bonds Payable $ 7,169,801 Business -Type Activities: General Obligation Revenue Bonds: General Obligation Bonds of 2014A $ 5,275,000 2.00-3.00% 06/19/14 02/01/29 $ 965,000 Unamortized Bond Premium 15,586 Total Business -Type Activities Bonds Payable $ 980,586 General Obligation Bonds — These bonds were issued to finance various improvements and will be repaid from taxes and special assessments. Minimum annual principal and interest payments required to retire general obligation bonds are as follows: Years 2019 2020 2021 2022 2023 2024-2028 2029-2033 Totals Governmental Activities (42) Bonds Payable Principal Interest $ 890,000 $ 165,363 925,000 145,113 945,000 124,238 960,000 102,822 990,000 78,394 2,015,000 169,269 275,000 4,125 $ 7,000,000 $ 789,324 NOTE 5 CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 LONG-TERM LIABILITIES (CONTINUED) B. Bonds Payable (Continued) C. Compensated Absences Liabilities for personal time off, vacation, compensation time, and sick leave will be paid by the General Fund and proprietary funds as appropriate. D. Ultimate Responsibility for Debt General obligation bonds are backed by the full faith and credit of the City except for the project revenue bonds. E. Conduit Debt Obligations At times, the City has issued various types of revenue bonds to provide financial assistance to private sector, nonprofit, or governmental entities to finance the acquisition or construction of facilities deemed to be in the public interest. The bonds are secured by the property financed and are payable solely from payments received on the underlying mortgage loans. Neither the City, 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 City's financial statements. Original obligations totaled $800,000. It is not practical to determine the outstanding balance of the conduit debt at year-end. (43) Business -Type Activities Bonds Payable Years Principal Interest 2019 $ 80,000 $ 22,031 2020 80,000 20,431 2021 80,000 18,831 2022 85,000 17,181 2023 85,000 15,428 2024-2028 455,000 45,688 2029-2033 100,000 1,500 Totals $ 965,000 $ 141,090 C. Compensated Absences Liabilities for personal time off, vacation, compensation time, and sick leave will be paid by the General Fund and proprietary funds as appropriate. D. Ultimate Responsibility for Debt General obligation bonds are backed by the full faith and credit of the City except for the project revenue bonds. E. Conduit Debt Obligations At times, the City has issued various types of revenue bonds to provide financial assistance to private sector, nonprofit, or governmental entities to finance the acquisition or construction of facilities deemed to be in the public interest. The bonds are secured by the property financed and are payable solely from payments received on the underlying mortgage loans. Neither the City, 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 City's financial statements. Original obligations totaled $800,000. It is not practical to determine the outstanding balance of the conduit debt at year-end. (43) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 6 OTHER POSTEMPLOYMENT BENEFITS At December 31, 2018, the City adopted GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other than Pensions. The City engaged an actuary to determine the City's liability for postemployment healthcare benefits other than pensions as of January 1, 2018. A. Plan Description The City provides benefits for retirees as required by Minnesota Statute §471.61 subdivision 2b. Active employees, who retire from the City when over age 50 and with 20 years of service, may continue coverage with respect to both themselves and their eligible dependent(s) under the City's health benefits program until age 65. Pursuant to the provisions of the plan, retirees are required to pay the total premium cost. The Retiree Health Plan does not issue a publicly available financial report. At December 31, 2018, the following employees were covered by the benefit terms: Inactive Plan Members or Beneficiaries Currently Receiving Benefit Payments Active Plan Members Total B. Contributions and Funding Policy 6 53 59 The City funds its OPEB obligation on a pay as you go basis. The City contributes amounts for claims and administration costs less deductibles, coinsurance, and contributions for inactive participants during the fiscal year. For fiscal year 2018, the City contributed $35,472 to the plan. For governmental activities, other postemployment benefits are generally liquidated through the General Fund. C. Total OPEB Liability The City's total OPEB liability was measured as of January 1, 2018 and was determined by an actuarial valuation as of that date. Actuarial Assumptions The total OPEB liability in the January 1, 2018 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement, unless otherwise specified. (44) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 6 OTHER POSTEMPLOYMENT BENEFITS (CONTINUED) C. Total OPEB Liability (Continued) Actuarial Assumptions The total OPEB liability in the January 1, 2018 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement, unless otherwise specified. Valuation Date: January 1, 2018 Measurement Date: December 31, 2017 Methods and Assumptions Used to Determine Contribution Rates: Actuarial Cost Method Entry Age Amortization Method Level Percentage of Pay, Closed Amortization Period Investment gains/losses are amortized over 5 years, liability $ 736,222 gains/losses are amortized over Average Working Lifetime, and Plan changes are recognized immediately. Inflation 3.44% Healthcare Cost Trend Rate 8.33% for 2018, decreasing 0.33% per year to an ultimate 23,193 rate of 5.00%. Salary Increases 3.50% Discount Rate 3.44% Retirement Age Age 55 for Police & Fire, Age 63 for all others (based on PERA average rates) Mortality RP -2014 employer generational mortality table projected with mortality improvement scale MP -2016 for Police & Fire and RP -2014, adjusted for white collar and mortality improvements using projection scale MP -2015 Discount Rate The City's OPEB plan is not funded by a trust and, therefore, the City uses the 20 -year municipal bond index rate to develop its long-term rate of return and discount rate. This rate was 4.09% in the current actuarial valuation, which was updated from the 4.00% used in the prior actuarial valuation. D. Changes in the Total OPEB Liability The details of the changes in the City's total OPEB liability were as follows for 2018: (45) Increase (Decrease) in Total OPEB Liability (a) Balance at 12/31/17 $ 736,222 Changes for the Year: Service Cost 82,950 Interest 30,294 Changes of Assumptions 23,193 Benefit Payments (35,472) Net Changes 100,965 Balance at 12/31/18 $ 837,187 (45) NOTE 6 CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 OTHER POSTEMPLOYMENT BENEFITS (CONTINUED) D. Changes in the Total OPEB Liability (Continued) The following changes in assumptions occurred between the current and prior actuarial valuations: The actuarial cost method was updated along with the implementation of GASB Statement No. 75 to the Entry Age normal level percent of pay method, with investment gains/losses being amortized over 5 years, liability gains/losses amortized over the assumed average working lifetime, and plan changes recognized immediately. Previously, under GASB Statement No, 45, the Entry Age Normal actuarial cost method was used and the unfunded actuarial accrued liability was being amortized as a level percent of payroll over a 30 -year period. E. Sensitivity of Total OPEB Liability The following presents the total OPEB liability of the City, as well as what the City's net OPEB liability would be if it were calculated using a discount rate that is 1 percentage point lower (2.44%) or 1 percentage point higher (4.44%) than the current discount rate: 1 % Decrease Discount Rate 1% Increase (2.44%) (3.44%) (4.44%) Total OPEB Liability (Asset) $ 908,320 $ 837,187 $ 770,500 The following presents the net OPEB liability of the City, as well as what the City's net OPEB liability would be if it were calculated using the healthcare cost trend rates that are 1 percentage point lower (7.33% decreasing to 4.0%) or 1 percentage point higher (9.33% decreasing to 6.0%) than the current healthcare trend rates: 1 % Decrease Healthcare Cost 1 % Increase (7.33% Trend Rates (9.33% Decreasing (8.33% Decreasing Decreasing to 4.00%) to 5.00%) to (6.00%) Total OPEB Liability (Asset) $ 732,900 $ 837,187 $ 961,499 F. OPEB Expense, Deferred Outflows of Resources, and Deferred Inflows of Resources For the year ended December 31, 2018, the City recognized pension expense of $72,762. At December 31, 2018, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources: Deferred Deferred Outflows of Inflows of Resources Resources Changes of Assumptions $ 20,760 $ - (46) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 6 OTHER POSTEMPLOYMENT BENEFITS (CONTINUED) F. OPEB Expense, Deferred Outflows of Resources, and Deferred Inflows of Resources (Continued) Amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: Year Ending December 31, Amount 2019 $ 2,432 2020 2,432 2021 2,432 2022 2,432 2023 2,432 Thereafter 8,600 NOTE 7 FLEXIBLE BENEFIT PLAN The City offers a flexible benefit plan (the Plan). The Plan is a "cafeteria plan" under §125 of the Internal Revenue Code (IRC). All employees who meet the eligibility requirements may participate in the Plan. To be eligible, an employee must be at least 20 years of age and be regularly scheduled to work more than 20 hours per week. Eligible employees can elect to participate by contributing pre-tax dollars withheld from payroll checks to the Plan for healthcare and dependent care benefits. Payments are made from the Plan to participating employees upon submitting a request for reimbursement of eligible expenses actually incurred by the participant. All assets of the Plan are held and administered by an independent contract administrator for child care and medical expense reimbursements, and by the City for health insurance premiums. All activity of the Plan is included in the financial statements as part of the General Fund and enterprise funds as employee benefits. All property of the Plan and income attributable to that property is solely the property of the City, subject to the claims of the City's general creditors. Participants' rights under the Plan are equal to those of general creditors of the City in an amount equal to the eligible healthcare and dependent care expenses incurred by the participants. The City believes it is unlikely that it will use the assets to satisfy the claims of general creditors in the future. (47) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 8 DEFINED BENEFIT PENSION PLANS — STATE-WIDE A. Plan Description The City of Orono 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 IRC. 1. General Employees Retirement Plan (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 either the Coordinated Plan or the Basic Plan. Coordinated Plan members are covered by Social Security and Basic Plan members are not. The Basic Plan was closed to new members in 1967. All new members must participate in the Coordinated Plan. 2. Public Employees Police and Fire Plan (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. 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. Benefit increases are provided to benefit recipients each January. Increases are related to the funding ratio of the plan. Members in plans that are at least 90% funded for two consecutive years are given 2.5% increases. Members in plans that have not exceeded 90% funded, or have fallen below 80%, are given 1 % increases. The benefit provisions stated in the following paragraphs of this section are current provisions and apply to active plan participants. 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. (48) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 8 DEFINED BENEFIT PENSION PLANS — STATE-WIDE (CONTINUED) B. Benefits Provided (Continued) 1. General Employees Plan Benefits 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 and Basic Plan members. The retiring member receives the higher of a step -rate benefit accrual formula (Method 1) or a level accrual formula (Method 2). Under Method 1, the annuity accrual rate for a Basic Plan member is 2.2% of average salary for each of the first 10 years of service and 2.7% for each remaining year. The annuity accrual rate for a Coordinated Plan member is 1.2% of average salary for each of the first 10 years and 1.7% for each remaining year. Under Method 2, the annuity accrual rate is 2.7% of average salary for Basic Plan members and 1.7% for Coordinated Plan members for each year 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. 2. Police and Fire Plan Benefits Benefits for the Police and Fire Plan members first hired after June 30, 2010, but before July 1, 2014, vest on a prorated basis from 50% after 5 years up to 100% after 10 years of credited service. Benefits for Police and Fire Plan members first hired after June 30, 2014, vest on a prorated basis from 50% after 10 years up to 100% after 20 years of credited service. The annuity accrual rate is 3% 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. C. Contributions Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. Contribution rates can only be modified by the state legislature. 1. General Employees Fund Contributions Basic Plan members and Coordinated Plan members were required to contribute 9.1 % and 6.50%, respectively, of their annual covered salary in calendar year 2018. The City was required to contribute 11.78% of pay for Basic Plan members and 7.50% for Coordinated Plan members in calendar year 2018. The City contributions to the GERF for the year ended December 31, 2018, were $129,021. The City contributions were equal to the required contributions as set by state statute. 2. Police and Fire Fund Contributions Plan members were required to contribute 10.8% of their annual covered salary in calendar year 2018. The City was required to contribute 16.20% of pay for members in calendar year 2018. The City contributions to the Police and Fire Fund for the year ended December 31, 2018, were $370,490. The City contributions were equal to the required contributions as set by state statute. (49) NOTE 8 CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 DEFINED BENEFIT PENSION PLANS — STATE-WIDE (CONTINUED) D. Pension Costs 1. General Employees Fund Pension Costs At December 31, 2018, the City reported a liability of $1,420,183 for its proportionate share of the General Employees Fund's net pension liability. The net pension liability was measured as of June 30, 2018, 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 proportion 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, 2017, through June 30, 2018, relative to the total employer contributions received from all of PERA's participating employers. At June 30, 2018, the City's proportion was .0256%, an increase from the prior year's proportion of .0254°/x. For the year ended December 31, 2018, the City recognized pension expense of $97,529 for its proportionate share of the General Employees Plan's pension expense. Also, the City recognized an additional $12,526 as pension expense, (and grant revenue) for its proportionate share of the state of Minnesota's contribution of $16 million to the GERF during the City's fiscal year ended December 31, 2018. At December 31, 2018, the City reported its proportionate share of the General Employees Plan's deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Description Differences Between Expected and Actual Economic Experience Changes in Actuarial Assumptions Net Difference Between Projected and Actual Earnings on Pension Plan Investments Changes in Proportion and Differences Between City Contributions and Proportionate Share of Contributions City Contributions Subsequent to the Measurement Date Total Deferred Deferred Outflows of Inflows of Resources Resources 37,590 135,663 9,185 69,646 $ 252,084 $ 41,421 159,573 145,120 21,550 $ 367,664 A total of $69,646 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ending December 31, 2019. Other amounts reported as deferred outflows and inflows of resources related to pensions will be recognized in pension expense as follows: Pension Expenses Year Ended December 31, Amount 2019 $ 37,401 2020 (80,811) 2021 (112,174) 2022 (29,642) 2023 - Thereafter - (50) NOTE 8 CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 DEFINED BENEFIT PENSION PLANS — STATE-WIDE (CONTINUED) D. Pension Costs (Continued) 2. Police and Fire Fund Pension Costs At December 31, 2018, the City reported a liability of $2,312,997 for its proportionate share of the Police and Fire Fund's net pension liability. The net pension liability was measured as of June 30, 2018, 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 proportion 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, 2017, through June 30, 2018, relative to the total employer contributions received from all of PERA's participating employers. At June 30, 2018, the City's proportion was .217%, an increase from the prior year proportionate share of .213%. For the year ended December 31, 2018, the City recognized pension expense of $216,502 for its proportionate share of the Police and Fire Fund's pension expense. The City also recognized $19,530 for the year ended December 31, 2018, as pension expense (and grant revenue) for its proportionate share of the state of Minnesota's on -behalf contributions to the Police and Fire Fund. Legislation passed in 2013 required the state of Minnesota to begin contributing $9 million to the Police and Fire Fund each year, starting in fiscal year 2014. At December 31, 2018, the City reported its proportionate share of the Police and fire Plan's deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Description Differences Between Expected and Actual Economic Experience Changes in Actuarial Assumptions Net Difference Between Projected and Actual Earnings on Pension Plan Investments Changes in Proportion and Differences Between City Contributions and Proportionate Share of Contributions City Contributions Subsequent to the Measurement Date Total (51) Deferred Outflows of Resources 93,226 2,875,630 60,379 199,049 $ 3,228,284 Deferred Inflows of Resources $ 567,437 3,405,034 484,464 164,049 $ 4,620,984 NOTE 8 CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 DEFINED BENEFIT PENSION PLANS — STATE-WIDE (CONTINUED) D. Pension Costs (Continued) 2. Police and Fire Fund Pension Costs (Continued) A total of $199,049 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended December 31, 2019. Other amounts reported as deferred outflows and inflows of resources related to pensions will be recognized in pension expense as follows: Year Ended December 30, 2019 2020 2021 2022 2023 Thereafter Pension Expenses Amount $ (100,142) (207,541) (361,270) (927,245) 4,449 For the year ended December 31, 2018, the City recognized total pension expenses of $314,013 for their proportionate shares of the pension expense for all of the plans in which it participates. E. Actuarial Assumptions The total pension liability in the June 30, 2018, actuarial valuation was determined using the following actuarial assumptions: Inflation 2.50% per Year 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 for retirees are assumed to be 1.25% per year for the General Employees Plan, 1.0% per year for the Police and Fire Plan, and 2.0% per year for the Correctional Plan. Actuarial assumptions used in the June 30, 2018, valuation were based on the results of actuarial experience studies. The most recent six-year experience study in the General Employees Plan was completed in 2015. The most recent four-year experience study for Police and Fire Plan was completed in 2016. (52) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 8 DEFINED BENEFIT PENSION PLANS — STATE-WIDE (CONTINUED) E. Actuarial Assumptions (Continued) The following changes in actuarial assumptions occurred in 2018: General Employees Fund The mortality projection scale was changed from MP -2015 to MP -2017. The assumed postretirement benefit increase was changed from 1.0% per year through 2044 and 2.50% per year thereafter to 1.25% per year. Police and Fire Fund The mortality projection scale was changed from MP -2016 to MP -2017. As set by statute, the assumed postretirement benefit increase was changed from 1.0% per year through 2064 and 2.50% per year thereafter to 1.0% for all years, with no trigger. The State Board of Investment, which manages the investments of PERA, prepares an analysis of 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 weighted 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 below: F. Discount Rate The discount rate used to measure the total pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that employee and employer contributions will be made at rates set in Minnesota Statutes. Based on these assumptions, the fiduciary net positions 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 of pension plan investments was applied to all periods of projected benefit payments determine the total pension liability. (53) Long -Term Target Expected Real Asset Class Allocation Rate of Return Domestic Equity 36% 5.10% International Equity 17 5.30% Bonds 20 0.75% Alternative Assets 25 5.90% Cash 2 - % Totals 100% F. Discount Rate The discount rate used to measure the total pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that employee and employer contributions will be made at rates set in Minnesota Statutes. Based on these assumptions, the fiduciary net positions 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 of pension plan investments was applied to all periods of projected benefit payments determine the total pension liability. (53) NOTE 8 CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 DEFINED BENEFIT PENSION PLANS — STATE-WIDE (CONTINUED) 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: Description GERF PENSION LIABILITY City's Proportionate Share of the GERF Net Pension Liability PEPFF PENSION LIABILITY City's Proportionate Share of the PEPFF Net Pension Liability H. Pension Plan Fiduciary Net Position 1% Decrease in 1% Increase in Discount Rate Current Discount Discount Rate (6.50%) Rate (7.50°/x) (8.50%) $ 2,307,979 $ 1,420,183 $ 687,333 $ 4,959,210 $ 2,312,997 $ 124,688 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; by writing to PERA at 60 Empire Drive #200, St. Paul, Minnesota, 55103-2088; or by calling (651) 296-7460 or 1-800-652-9026. That report may be obtained on the internet at www.mnpera.org. (54) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 9 FUND BALANCES Certain portions of fund balance are restricted to provide for funding on certain long-term liabilities or as required by other outside parties. Restricted, Committed and Assigned fund balances at December 31, 2018 are as follows: A. Restricted for Debt Service — This represents amounts which are restricted for future debt payments. B. Restricted for Parkland Acquisitions and Improvements — Represents amounts which are received through park dedication fees and are restricted for parkland acquisitions and improvements. C. Restricted for Drug and Alcohol Law Enforcement — Represents amounts received from the State of Minnesota's Drug and Alcohol Task Force which are restricted for drug and alcohol related law enforcement. D. Restricted for Home Buyer Purchase Assistance — Represents amounts assigned for various home buyer assistance programs. E. Restricted for Lurton Park Development and Maintenance — Represents amounts restricted for the development and maintenance of Lurton Park as a stipulation of the land donation to the City. F. Restricted for Senior Housing — Represents amounts related to Tax Increment Financing District 1-1 and which are restricted to provide housing opportunities for seniors within the City. Its funding source is the property taxes on the captured value. G. Restricted for Golf Course Improvements — Represents amounts which are restricted for future golf course improvements. H. Restricted for Big Island — Represents amounts which are restricted for the improvement of the Big Island Nature Park I. Restricted for Other Improvements — Represents amounts which are restricted for other improvement projects of the City. J. Assigned for Long Lake Fire Equipment — Represents amounts which are assigned by the City for the purchase of fire equipment. K. Assigned for Capital Equipment Purchases — Represents amounts which are assigned by the City to finance future capital equipment purchases. L. Assigned for Police Equipment Purchases — Represents amounts which are assigned by the City to finance future police equipment purchases. M. Assigned for Future Construction Projects — Represents amounts which are assigned by the City to finance future construction projects. N. Assigned for Community -wide Projects — Represents amounts which are assigned by the City for community -wide projects. (55) CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 9 FUND BALANCES (CONTINUED) O. Assigned for Debt Service — Represents amounts which are assigned by the City for future debt service payments. P. Assigned for Police Garage — Represents amounts assigned for future expenditures related to the City's Police Garage. NOTE 10 COMMITMENTS AND CONTINGENCIES A. Federal and State Revenue Amounts recorded or receivable from state agencies are subject to agency audit and adjustment. Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of claims which may be disallowed by the grantor agencies cannot be determined at this time, although the City expects such amounts, if any, to be immaterial. B. Conditional State Grant In 2005, as a part of the City's acquisition of Big Island Park, the City was awarded a grant from the state of Minnesota in the amount of $2,000,000. The grant is repayable to the state if the property is not maintained for low -impact recreation and conservation use. C. Litigation The City attorney has indicated that existing and pending lawsuits, claims and other actions in which the City is a defendant are either covered by insurance; of an immaterial amount; or, in the judgment of the City attorney, remotely recoverable by plaintiffs. D. Police Services Contracts As of December 31, 2018, the City of Orono had several contracts to provide police services to neighboring cities. The most significant of those was a contract with the city of Mound, which the City entered into as of January 1, 2013 and which extends 10 years to December 31, 2022. The contract also included annual payments from the city of Mound starting at $1,545,000 in 2013 and increasing between 1%-5% each year through the end of the contract. The City also has a contract with the cities of Minnetonka Beach and Spring Park to furnish law enforcement services to each respective city. The original contract term ended December 31, 2012 and includes the option to verbally extend it each year for an additional one-year period. The contract has been extended each year through 2019. E. Fire Services Contract As of year-end, the City had committed to purchasing fire protection services from the city of Wayzata for fiscal year 2017. The annual fee is determined by the percentage of total calls which are in the Orono service area for the preceding three years and is expected to be similar to the 2018 fee of $389,365. (56) REQUIRED SUPPLEMENTARY INFORMATION CITY OF ORONO SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GENERAL FUND - BUDGET TO ACTUAL (GAAP BASIS) YEAR ENDED DECEMBER 31, 2018 (56) Budgeted Amounts Over (Under) Original Final Actual Final Budget REVENUE Property Taxes $ 4,355,050 $ 4,355,050 $ 4,288,106 $ (66,944) Licenses and Permits 466,650 466,650 746,043 279,393 Intergovernmental Revenue 240,220 240,220 411,648 171,428 Fines and Forfeits 79,700 79,700 83,875 4,175 Other Revenue: Investment Earnings 54,500 54,500 70,155 15,655 User Fees 2,979,480 2,979,480 3,211,749 232,269 Rents and Refunds 5,400 5,400 5,400 - Miscellaneous Revenue 23,500 23,500 47,429 23,929 Total Revenue 8,204,500 8,204,500 8,864,405 659,905 EXPENDITURES General Government: Administration 424,349 424,349 453,286 28,937 Elections 25,552 25,552 20,037 (5,515) Assessing 182,000 182,000 185,750 3,750 Finance 331,926 331,926 315,215 (16,711) Legal 112,000 112,000 114,340 2,340 Human Services 12,400 12,400 12,125 (275) Central Services 273,245 273,245 328,333 55,088 Total General Government 1,361,472 1,361,472 1,429,086 67,614 Public Safety: Police 4,464,785 4,464,785 4,530,201 65,416 Fire 390,000 390,000 389,365 (635) Inspection and Zoning 719,129 719,129 706,326 (12,803) Total Public Safety 5,573,914 5,573,914 5,625,892 51,978 Streets: Other 525,893 525,893 595,740 69,847 Parks and Recreation: Golf Course 172,831 172,831 213,492 40,661 Other 173,136 173,136 187,859 14,723 Total Parks and Recreation 345,967 345,967 401,351 55,384 Debt Service Principal Retirement 6,024 6,024 - (6,024) Interest and Fiscal Charges 131 131 (131) Total Debt Service 6,155 6,155 - (6,155) Total Expenditures 7,813,401 7,813,401 8,052,069 238,668 EXCESS OF REVENUE OVER EXPENDITURES 391,099 391,099 812,336 421,237 OTHER FINANCE SOURCES (USES) Transfers Out (380,000) (380,000) (837,703) (457,703) Proceeds from Sale of Capital Assets 15,000 15,000 33,097 18,097 Total Other Finance Sources (Uses) (365,000) (365,000) (804,606) (439,606) NET CHANGE IN FUND BALANCES $ 26,099 $ 26,099 7,730 $ (18,369) FUND BALANCES Beginning of Year 4,446,836 End of Year $ 4,454,566 (56) CITY OF ORONO GENERAL FUND BUDGET TO ACTUAL COMPARISON DECEMBER 31, 2018 General Fund: General Government: Administration Assessing Legal Central Services Total General Government Public Safety: Police Streets: Other Parks and Recreation: Golf Course Other Total Parks and Recreation The overall expenditure budget was over budget for the year. (57) Actual in Final Excess of Budget Actual Budget $ 424,349 $ 453,286 $ 28,937 182,000 185,750 3,750 112,000 114,340 2,340 273,245 328,333 55,088 809,594 895,959 86,365 4,464,785 4,530,201 65,416 525,893 595,740 69,847 172,831 213,492 40,661 173,136 187,859 14,723 345,967 401,351 55,384 The overall expenditure budget was over budget for the year. (57) CITY OF ORONO SCHEDULE OF FUNDING PROGRESS FOR POSTEMPLOYMENT BENEFIT PLAN DECEMBER 31, 2018 Covered Employee Payroll 3,900,000 City's Total OPEB Liability as a Percentage of the Covered Employee Payroll 21.47% *Additional data will be presented as it become available and eventually 10 years of data will be presented. Notes to Schedule: Changes in Assumptions: • The discount rate used is the 20 -year municipal bond index, as the plan is not funded. This assumed rate increased from 4.00% to 4.09%. • The actuarial cost method was updated along with the implementation of GASB Statement No. 74 to the Entry Age Normal Level Percent of Pay method, with investment gains/losses being amortized over 5 years, liability gains/losses are amortized over the average working lifetime, and plan changes are recognized immediately. Previously, under GASB Statement No. 45, the Entry Age Normal actuarial cost method was used, and the unfunded actuarial accrued liability was being amortized as a level percent of payroll over a 30 -year period. (58) 2018 Total OPEB Liability Service Cost $ 82,950 Interest 30,294 Changes of Benefit Terms - Difference Between Expected and Actual Experience - Changes of Assumptions 23,193 Benefit Payments (35,472) Net Change in Total OPEB Liability 100,965 Total OPEB Liability - Beginning 736,222 Total OPEB Liability - Ending $ 837,187 Plan Fiduciary Net Position as a Percentage of the Total OPEB Liability 0.00% Covered Employee Payroll 3,900,000 City's Total OPEB Liability as a Percentage of the Covered Employee Payroll 21.47% *Additional data will be presented as it become available and eventually 10 years of data will be presented. Notes to Schedule: Changes in Assumptions: • The discount rate used is the 20 -year municipal bond index, as the plan is not funded. This assumed rate increased from 4.00% to 4.09%. • The actuarial cost method was updated along with the implementation of GASB Statement No. 74 to the Entry Age Normal Level Percent of Pay method, with investment gains/losses being amortized over 5 years, liability gains/losses are amortized over the average working lifetime, and plan changes are recognized immediately. Previously, under GASB Statement No. 45, the Entry Age Normal actuarial cost method was used, and the unfunded actuarial accrued liability was being amortized as a level percent of payroll over a 30 -year period. (58) CITY OF ORONO PERA SCHEDULE OF THE CITY'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY DECEMBER 31, 2018 GERF Schedule of the City's Proportionate Share of the Net Pension Liability Last Four Fiscal Years* City's Proportion of the Net Pension Liability City's Proportionate Share of the Net Pension Liability City's Covered Payroll City's Proportionate Share of the Net Pension Liability as a Percentage of its Covered Payroll Plan Fiduciary Net Position as a Percentage of the Total Pension Liability PEPFF Schedule of the City's Proportionate Share of the Net Pension Liability Last Four Fiscal Years* City's Proportion of the Net Pension Liability City's Proportionate Share of the Net Pension Liability City's Covered Payroll City's Proportionate Share of the Net Pension Liability as a Percentage of its Covered Payroll Plan Fiduciary Net Position as a Percentage of the Total Pension Liability Measurement Measurement Measurement Measurement Date 6/30/2018 Date 6/30/2017 Date 6/30/2016 Date 6/30/2015 0.0256% 0.0254% 0.0259% 0.0265% $ 1,420,183 $ 1,621,519 $ 2,102,952 $ 1,373,368 $ 1,726,285 $ 1,639,281 $ 1,615,476 $ 1,572,141 82.27% 98.92% 130.18% 87.36% 79.53% 75.90% 68.91% 78.20% Measurement Measurement Measurement Measurement Date 6/30/2018 Date 6/30/2017 Date 6/30/2016 Date 6/30/2015 0.2170% 0.2130% 0.2180% 0.2310% $ 2,312,997 $ 2,875,753 $ 8,748,719 $ 2,624,701 $ 2,282,909 $ 2,186,712 $ 2,107,585 $ 2,138,417 101.32% 131.51% 415.11% 122.74% 88.80% 85.40% 63.88% W61% Additional years' information will be presented as it becomes available until the above tables present ten years of information. (59) CITY OF ORONO PERA SCHEDULE OF CITY CONTRIBUTIONS DECEMBER 31, 2018 GERF Schedule of City Contributions Last Four Fiscal Years Additional years' information will be presented as it becomes available until the above tables present ten years of information. M 2018 2017 2016 2015 2014 Statutorily Required Contribution $ 129,021 $ 122,479 $ 122,115 $ 119,404 $ 112,270 Contributions in Relation to the Statutorily Required Contribution (129,021) (122,479) (122,115) (119,404) (112,270) Contribution Deficiency (Excess) $ $ $ $ $ City's Covered Payroll $ 1,720,280 $ 1,633,053 $ 1,628,200 $ 1,592,053 $ 1,548,552 Contributions as a Percentage of Covered Payroll 7.50% 7.50% 7,50% 7.50% 7.25 PEPFF Schedule of City Contributions Last Four Fiscal Years 2018 2017 2016 2015 2014 Statutorily Required Contribution $ 370,490 $ 358,655 $ 349,003 $ 342,006 $ 324,565 Contributions in Relation to the Statutorily Required Contribution (370,490) (358,655) (349,003) (342,006) (324,565) Contribution Deficiency (Excess) $ $ $ $ $ City's Covered Payroll $ 2,286,975 $ 2,213,920 $ 2,154,340 $ 2,111,148 $ 2,003,488 Contributions as a Percentage of Covered Payroll 16.20% 16.20% 16.20% 16.20% 16.20 Additional years' information will be presented as it becomes available until the above tables present ten years of information. M COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES CITY OF ORONO NONMAJOR GOVERNMENTAL FUNDS COMBINING BALANCE SHEET DECEMBER 31, 2018 ASSETS Cash and Investments Receivables: Accrued Interest Delinquent Taxes Deferred Special Assessments Due from Other Governmental Units Total Assets LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCE LIABILITIES Accounts and Contracts Payable Due to Other Governmental Units Total Liabilities DEFERRED INFLOWS OF RESOURCES Unavailable Revenue - Taxes Unavailable Revenue - Special Assessments Total Deferred Inflows of Resources FUND BALANCE Restricted: Debt Service Parkland Acquisitions and Improvement Drug and Alcohol Law Enforcement Home Buyer Purchase Assistance Lurton Park Development and Maintenance Senior Housing Golf Course Improvements Big Island Other Improvements Assigned: Long Lake Fire Equipment Capital Equipment Purchases Police Equipment Purchases Future Construction Projects Community -Wide Projects Debt Service Police Garage Project Total Fund Balance Total Liabilities, Deferred Inflows of Resources, and Fund Balance Special Debt Capital Revenue Service Project Totals $ 1,344,077 $ 2,145,737 $ 2,505,212 $ 5,995,026 862 1,892 4,190 6,944 - 17,400 - 17,400 20,400 - 6,467 26,867 141 6,672 - 6,813 $ 1,365,480 $ 2,171,701 $ 2,515,869 $ 6,053,050 $ 4,205 $ - $ 5,311 $ 9,516 - - 100,733 100,733 4,205 - 106,044 110,249 - 17,400 - 17,400 20,400 - 6,467 26,867 20,400 17,400 6,467 44,267 - 2,154,301 - 2,154,301 695,544 - - 695,544 334,700 - - 334,700 133,585 - - 133,585 17,640 - - 17,640 152,971 - - 152,971 270 - - 270 6,000 6,000 165 - - 165 - - 316,138 316,138 - - 213,307 213,307 - - 299,383 299,383 - - 959,044 959,044 - - 544,894 544,894 - - 45,709 45,709 - - 24,883 24,883 1,340,875 2,154,301 2,403,358 5,898,534 $ 1,365,480 $ 2,171,701 $ 2,515,869 $ 6,053,050 (61) CITY OF ORONO NONMAJOR GOVERNMENTAL FUNDS COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES DECEMBER 31, 2018 (62) Special Debt Capital Revenue Service Project Totals REVENUE Property Taxes $ 77,876 $ 701,916 $ 4 $ 779,796 Special Assessments 20,810 - 2,125 22,935 Intergovernmental Revenue 19,995 143,138 - 163,133 Fines and Forfeitures 40,185 - - 40,185 Other Revenue: Interest Income 10,833 11,986 25,673 48,492 Total Revenue 373,879 857,040 33,087 1,264,006 EXPENDITURES Current: General Government: Administration 1,851 - - 1,851 Legal 2,139 - - 2,139 Total General Government 3,990 - - 3,990 Public Safety: Police 2,194 - - 2,194 Parks and Recreation Other 20,645 - - 20,645 Capital Outlay: Other 304,113 - 1,078,025 1,382,138 Debt Service: Principal Retirement - 660,000 - 660,000 Interest and Fiscal Charges - 187,404 - 187,404 Total Debt Service - 847,404 - 847,404 Total Expenditures 330,942 847,404 1,078,025 2,256,371 EXCESS (DEFICIENCY) OF REVENUE OVER (UNDER) EXPENDITURES 42,937 9,636 (1,044,938) (992,365) OTHER FINANCE SOURCES (USES) Transfers In 49,051 377,803 299,448 726,302 Transfers Out (41,348) (338,256) - (379,604) Total Other Finance Sources (Uses) 7,703 39,547 299,448 346,698 NET CHANGE IN FUND BALANCES 50,640 49,183 (745,490) (645,667) FUND BALANCES Beginning of Year 1,290,235 2,105,118 3,148,848 6,544,201 End of Year $ 1,340,875 $ 2,154,301 $ 2,403,358 $ 5,898,534 (62) NONMAJOR SPECIAL REVENUE FUNDS Nonmajor special revenue funds are used to account for revenue derived from specific revenue sources that are legally restricted to expenditures for specific purposes. Park Fund — Used to account for received park dedication fees to be used for land acquisition and park development. Drug and Felony Forfeiture Fund — Used to account for proceeds received from seizures relating to drug and felony criminal activity, donations received for the police department, other appropriate revenues authorized by the City Council, and all authorized related expenditures. Affordable Housing Fund — Used to account for revenues and expenditures related to financial assistance packages provided to several low income households to make new town home units affordable. Lurton Park Fund — Used to account for revenues and expenditures related to the maintenance and trails within Lurton Park property. Senior Housing TIF Fund — Used to account for revenues and expenditures related to the senior housing property. Golf Course Improvement Fund — Used to account for revenues and expenditures related to the improvement of the City's golf course. Big Island Fund — Used to account for revenues and expenditures related to the improvement of the Big Island Nature Park. Carmen Bay Lake Improvement Fund — Used to account for revenues and expenditures related to the improvement of Carmen Bay. ASSETS Cash and Investments Receivables: Accrued Interest Deferred Special Assessments Due from Other Governmental Units Total Assets LIABILITIES AND FUND BALANCE RESOURCES, AND FUND BALANCE LIABILITIES Accounts and Contracts Payable DEFERRED INFLOWS OF RESOURCES Unavailable Revenue - Special Assessments FUND BALANCE Restricted: Parkland Acquisitions and Improvement Drug and Alcohol Law Enforcement Home Buyer Purchase Assistance Lurton Park Development and Maintenance Senior Housing Golf Course Improvements Big Island Improvements Other Improvements Total Fund Balance Total Liabilities and Fund Balance CITY OF ORONO NONMAJOR SPECIAL REVENUE FUNDS COMBINING BALANCE SHEET DECEMBER 31, 2018 Drug Carmen Bay and Felony Affordable Lurton Senior Golf Course Lake Park Forfeiture Housing Park Housing TIF Improvement Big Island Improvement Totals $ 698,902 $ 334,841 $ 133,497 $ 17,598 $ 152,946 $ 269 $ 6,000 $ 24 $ 1,344,077 520 186 88 42 25 1 - - 862 $ 3,878 $ 327 $ $ $ $ $ $ $ 4,205 - - 20,400 20,400 695,544 - - 695,544 - 334,700 334,700 - 133,585 133,585 - 17,640 - 17,640 - 152,971 - 152,971 - 270 - 270 - 6,000 - 6,000 - 165 165 695,544 334,700 133,585 17,640 152,971 270 6,000 165 1,340,875 (63) CITY OF ORONO NONMAJOR SPECIAL REVENUE FUNDS COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES YEAR ENDED DECEMBER 31, 2018 (64) Drug Carmen Bay and Felony Affordable Lurton Senior Golf Course Lake Park Forfeiture Housing Park Housing TIF Improvement Big Island Improvement Totals REVENUE Property Taxes $ $ $ $ $ 77,876 $ $ $ - $ 77,876 Special Assessments - 20,810 20,810 Licenses and Permits 203,650 - 203,650 Intergovernmental Revenue 19,995 19,995 Fines and Forfeitures - 40,185 - 40,185 Other Revenue: Investment Earnings 6,710 2,492 1,118 16 494 3 10,833 Miscellaneous Revenue - 530 - - - - - 530 Total Revenue 230,355 43,207 1,118 16 78,370 3 20,810 373,879 EXPENDITURES Current: General Government: Administration - 1,851 1,851 Legal 2,139 - 2,139 Total General Government 2,139 1,851 3,990 Public Safety: Police 2,194 - - 2,194 Parks and Recreation: Other - - - 20,645 20,645 Capital Outlay: Parks and Recreation 255,519 48,594 - 304,113 Total Expenditures 255,519 4,333 48,594 1,851 - 20,645 330,942 EXCESS (DEFICIENCY) OF REVENUE OVER EXPENDITURES (25,164) 38,874 1,118 (48,578) 76,519 3 165 42,937 OTHER FINANCE SOURCES (USES) Transfers In - - 49,051 - - - 49,051 Transfers Out (41,348) - (41,348) Total Other Finance Sources (Uses) (41,348) 49,051 - - - 7,703 NET CHANGE IN FUND BALANCES (66,512) 38,874 1,118 473 76,519 3 - 165 50,640 FUND BALANCES Beginning of Year 762,056 295,826 132,467 17,167 76,452 267 6,000 - 1,290,235 End of Year $ 695,544 $ 334,700 $ 133,585 $ 17,640 $ 152,971 $ 270 $ 6,000 $ 165 $ 1,340,875 (64) NONMAJOR DEBT SERVICE FUNDS Nonmajor debt service funds are used to account for the accumulation of resources used for the payment of principal, interest, and fiscal charges on various City bond issues. CITY OF ORONO NONMAJOR DEBT SERVICE FUNDS COMBINING BALANCE SHEET DECEMBER 31, 2018 (65) 2004 Improvement HRA 2005 2008 2000 2016 Refunding Public Project Street 2009 2010 General Improvement Refunding Bonds Revenue Bonds Reconstruction Refunding Bonds Obligation Bonds Bonds Bonds Totals ASSETS Cash and Investments $ $ 461 $ 910 $ $ 686,396 $ 757,839 $ 700,131 $ 2,145,737 Receivables: Accrued Interest 35 68 727 837 225 1,892 Delinquent Taxes - - 10,308 2,444 4,648 17,400 Due from Other Governmental Units - - 1,670 1,499 3,503 6,672 Total Assets $ $ 496 $ 978 $ $ 699,101 $ 762,619 $ 708,507 $ 2,171,701 DEFERRED INFLOWS AND FUND BALANCE DEFERRED INFLOWS OF RESOURCES Unavailable Revenue - Delinquent Taxes $ $ - $ - $ $ 10,308 $ 2,444 $ 4,648 $ 17,400 FUND BALANCE Restricted: Debt Service 496 978 688,793 760,175 703,859 2,154,301 Total Liabilities, Deferred Inflows of Resources, and Fund Balance $ $ 496 $ 978 $ $ 699,101 $ 762,619 $ 708,507 $ 2,171,701 (65) CITY OF ORONO NONMAJOR DEBT SERVICE FUNDS COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES YEAR ENDED DECEMBER 31, 2018 REVENUE Property Taxes Intergovernmental Revenue Other Revenue: Investment Earnings Total Revenue EXPENDITURES Debt Service: Principal Retirement Interest and Fiscal Charges Total Debt Service Total Expenditures EXCESS (DEFICIENCY) OF REVENUE OVER EXPENDITURES OTHER FINANCE SOURCES Transfers In Transfers Out Total Other Finance Sources NET CHANGE IN FUND BALANCES FUND BALANCES Beginning of Year End of Year 2004 Improvement HRA 2005 2008 2000 2016 Refunding Public Project Street 2009 2010 General Improvement Refunding Bonds Revenue Bonds Reconstruction Refunding Bonds Obligation Bonds Bonds Bonds Totals $ $ $ $ $ 123,827 $ 174,811 $ 403,278 $ 701,916 143,138 - - 143,138 496 978 4,097 5,897 518 11,986 496 978 271,062 180,708 403,796 857,040 - - 200,000 250,000 210,000 660,000 66,886 67,503 53,015 187,404 - 266,886 317,503 263,015 847,404 266,886 317,503 263,015 847,404 496 978 4,176 (136,795) 140,781 9,636 - - - 125,000 252,803 377,803 (3) (44,448) (87,803) (2) (206,000) - (338,256) (3) (44,448) (87,803) (2) - (81,000) 252,803 39,547 (3) (43,952) (86,825) (2) 4,176 (217,795) 393,584 49,183 3 44,448 87,803 2 684,617 977,970 310,275 2,105,118 $ $ 496 $ 978 $ - $ 688,793 $ 760,175 $ 703,859 $ 2,154,301 NONMAJOR CAPITAL PROJECT FUNDS Nonmajor capital project funds are used to account for the financial resources to be used for the acquisition or construction of major capital facilities. Improvement Equipment Outlay Fund — Used to account for the capital outlay costs of obtaining new equipment for various functions. Permanent Revolving Improvement Fund — Used to account for the construction costs prior to obtaining permanent financing. Community Investment Construction — This fund is used to collect and spend resources on the various community assets of the City. Navarre Fire Station Construction Fund — Used to account for the construction costs of a new fire station in the Navarre area of the City. Big Island Public Project Fund — Used to account for the improvement of the Big Island Nature Park. Police Garage Fund — This fund is used to collect and spend resources for the City's police garage project. FIRM :169 Cash and Investments Receivables: Accrued Interest Deferred Special Assessments Total Assets LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCE LIABILITIES Accounts and Contracts Payable Due to Other Governmental Units Total Liabilities DEFERRED INFLOWS OF RESOURCES Unavailable Revenue - Special Assessments FUND BALANCE Assigned: Long Lake Fire Equipment Capital Equipment Purchases Police Equipment Purchases Future Construction Projects Community -Wide Projects Debt Service Police Garage Project Unassigned Total Fund Balance Total Liabilities, Deferred Inflows of Resources, and Fund Balance CITY OF ORONO NONMAJOR CAPITAL PROJECT FUNDS COMBINING BALANCE SHEET DECEMBER 31, 2018 Improvement Permanent Community Navarre Big Island Equipment Revolving Investment Fire Station Public Police Outlay Improvement Construction Construction Project Garage Totals $ 631,513 $ 1,256,546 $ 546,570 $ 896 $ 44,804 $ 24,883 $ 2,505,212 1,359 1,881 941 7 2 - 4,190 6,467 - - 6,467 $ 632,872 $ 1,264,894 $ 547,511 $ 903 $ 44,806 $ 24,883 $ 2,515,869 $ 2,694 $ - $ 2,617 $ - $ - $ - $ 5,311 100,733 100,733 103,427 2,617 106,044 6,467 6,467 316,138 316,138 213,307 - 213,307 - 299,383 299,383 959,044 - 959,044 - 544,894 - - 544,894 - 903 44,806 - 45,709 - - 24,883 24,883 529,445 1,258,427 544,894 903 44,806 24,883 2,403,358 $ 632,872 $ 1,264,894 $ 547,511 $ 903 $ 44,806 $ 24,883 $ 2,515,869 (67) REVENUE Property Taxes Special Assessments Licenses and Permits Other Revenue: Investment Earnings Miscellaneous Revenue Total Revenue EXPENDITURES Capital Outlay: Other EXCESS (DEFICIENCY) OF REVENUE OVER EXPENDITURES OTHER FINANCE SOURCES (USES) Transfers In NET CHANGE IN FUND BALANCES FUND BALANCES Beginning of Year End of Year CITY OF ORONO NONMAJOR CAPITAL PROJECT FUNDS COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES YEAR ENDED DECEMBER 31, 2018 Improvement Permanent Community Equipment Revolving Investment Outlay Improvement Construction $ $ 4 $ 2,125 4,585 - - 8,314 11,584 5,765 - 325 375 14899 14,038 6,140 916,938 40,532 120,555 (904,039) (26,494) (114,415) 255,000 (649,039) (26,494) (114,415) Navarre Big Island Pavement Fire Station Public Management Police Construction Project Plan Garage $ $ $ 380,336 $ $ 7 3 4,012 - - 117,160 _ 7 3 501,508 - - 1,700,231 7 3 (1,198,723) 44,448 760,005 7 44,451 (438,718) Totals 4 2,125 4,585 25,673 700 33,087 1,078,025 (1,044,938) 299,448 (745,490) 1,178,484 1,284,921 659,309 896 355 377,595 24,883 3,148,848 $ 529,445 $ 1,258,427 $ 544,894 $ 903 $ 44,806 $ (61,123) $ 24,883 $ 2,403,358 NONMAJOR PROPRIETARY FUNDS Nonmajor proprietary funds are used to account for the financial resources that are produced and used by the business -type funds that are not significant enough to be presented individually. Recycling Fund — Used to account for the revenues and expenses related to the City's recycling program. Cable Television Fund — Used to account for the revenues and expenses created from the cable franchise agreements that the City is a part of. CITY OF ORONO NONMAJOR PROPRIETARY FUNDS COMBINING STATEMENT OF NET POSITION DECEMBER 31, 2018 ASSETS CURRENT ASSETS Cash and Cash Equivalents Receivables: Accounts Receivables (Net of Allowance) Accrued Interest Total Current Assets CAPITAL ASSETS Equipment Less: Accumulated Depreciation Net Capital Assets Total Assets DEFERRED OUTFLOWS OF RESOURCES Deferred Outflows - Pensions LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND NET POSITION NONCURRENT LIABILITIES Net Pension Liability DEFERRED INFLOWS OF RESOURCES Deferred Inflows - Pensions NET POSITION Net Investment in Capital Assets Unrestricted Total Net Position Total Liabilities and Balance Business -Type Activities Cable Recycling Television Totals $ 65,123 $ 152,300 $ 217,423 21,705 21,251 42,956 72 229 301 86,900 173,780 260,680 - 78,674 78,674 (17,830) (17,830) - 60,844 60,844 86,900 234,624 321,524 900 1,791 2,691 5,068 10,091 15,159 1,312 2,613 3,925 - 60,844 60,844 81,420 162,867 244,287 81,420 223,711 305,131 $ 87,800 $ 236,415 $ 324,215 CITY OF ORONO NONMAJOR PROPRIETARY FUNDS COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION YEAR ENDED DECEMBER 31, 2018 OPERATING REVENUE Sales and User Fees Other Total Operating Revenue Business -Type Activities Cable Recycling Television Totals $ 111,449 $ 78,716 $ 190,165 1,586 1,586 113,035 78,716 191,751 OPERATING EXPENSES 26,773 12,764 477 Personnel Services 6,770 14,026 20,796 Professional Services 110,423 30,197 140,620 Depreciation - 4,890 4,890 Maintenance and Repairs - 2,830 2,830 Other Expenses 9,851 - 9,851 Total Operating Expenses 127,044 51,943 178,987 OPERATING INCOME (LOSS) NONOPERATING REVENUE (EXPENSES) Investment Earnings State Grant Miscellaneous Revenue Total Nonoperating Revenue (Expenses) CHANGES IN NET POSITION NET POSITION Beginning of Year End of Year (70) (14,009) 26,773 12,764 477 1,542 2,019 23,887 - 23,887 4,388 4,388 28,752 1,542 30,294 14,743 28,315 43,058 66,677 m -- m 195,396 - 1.. 262,073 m - -4 INTERNAL SERVICE FUNDS Internal Service funds are used to account for the financing of goods or services by one department to other departments of the City, or to other governmental units, on a cost -reimbursement basis. Insurance Fund — Used to account for the insurance costs incurred by the City for general liability, property, vehicle, workers' compensation, and other insurance and deductibles. Compensated Absences Fund — Used to account for the accrual of sick and vacation days that are earned by the City's employees. Fleet Management Fund- Used to account for the costs of repairs, maintenance, and supplies for the City's various vehicles. IT Services- Used to account for the cost of IT services to the various City functions and departments CITY OF ORONO INTERNAL SERVICE FUNDS COMBINING STATEMENT OF NET POSITION DECEMBER 31, 2018 ASSETS CURRENT ASSETS Cash and Cash Equivalents Receivables: Accrued Interest Prepaids Total Assets LIABILITIES AND NET POSITION CURRENT LIABILITIES Accounts and Contracts Payable NET POSITION Unrestricted Total Liabilities and Net Position Insurance Compensated Fleet Fund Absences Management IT Services $ 266,919 $ 520,906 $ 791 684 267,710 521,590 Total 15,145 $ (6,348) $ 796,622 - - 1,475 6,348 6,348 15,145 - 804,445 20,720 20,720 $ 267,710 $ 521,590 $ (5,575) $ $ 783,725 $ 267,710 $ 521,590 $ 15,145 $ $ 804,445 (71) CITY OF ORONO INTERNAL SERVICE FUNDS COMBINING STATEMENT OF REVENUE, EXPENSES, AND CHANGES IN NET POSITION YEAR ENDED DECEMBER 31, 2018 OPERATING REVENUE Sales and User Fees Other Total Operating Revenue OPERATING EXPENSES Personnel Services Maintenance and Repairs Insurance Total Operating Expenses OPERATING INCOME (LOSS) NONOPERATING REVENUE Investment Earnings INCOME BEFORE TRANSFERS Transfers Out CHANGES IN NET POSITION NET POSITION Beginning of Year End of Year Insurance Compensated Fleet Fund Absences Management IT Service: $ 335,071 $ - $ - $ 2,475 37,890 126,351 337,546 37,890 126,351 12,120 - - 131,926 338,241 - 350,361 131,926 (12,815) 37,890 (5,575) Total $ 335,071 166,716 501,787 12,120 131,926 338,241 482,287 19,500 5,777 4,363 10,140 (7,038) 42,253 (5,575) - 29,640 (310,000) - - (310,000) (317,038) 42,253 (5,575) - (280,360) 584,748 479,337 - 1,064,085 $ 267,710 $ 521,590 $ (5,575) $ - $ 783,725 (72) CITY OF ORONO INTERNAL SERVICE FUNDS COMBINING STATEMENT OF CASH FLOWS YEAR ENDED DECEMBER 31, 2018 (73) Insurance Compensated Fleet Fund Absences Management IT Services Total CASH FLOWS FROM OPERATING ACTIVITIES Cash Receipts from Customers $ 335,071 $ $ - $ - $ 335,071 Cash Paid to Suppliers (343,524) (111,206) (6,348) (461,078) Other Receipts 10,155 37,890 126,351 174,396 Net Cash Provided (Used) by Operating Activities (10,418) 37,890 15,145 (6,348) 36,269 CASH FLOWS FROM INVESTING ACTIVITIES Interest Received on Investment 5,335 3,970 - 9,305 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers Out (310,000) - - (310,000) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (315,083) 41,860 15,145 (6,348) (264,426) Cash and Cash Equivalents - Beginning of Year 582,002 479,046 - 1,061,048 CASH AND CASH EQUIVALENTS - END OF YEAR $ 266,919 $ 520,906 $ 15,145 $ (6,348) $ 796,622 RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES Operating Income (Loss) $ (12,815) $ 37,890 $ (5,575) $ $ 19,500 Change in Assets and Liabilities: (Increase) Decrease in: Accounts Receivable 7,680 - 7,680 Prepaid Items - - (6,348) (6,348) Increase (Decrease) in: Accounts Payable (5,283) - 20,720 15,437 Net Cash Provided (Used) by Operating Activities $ (10,418) $ 37,890 $ 15,145 $ (6,348) $ 36,269 (73) STATISTICAL SECTION (UNAUDITED) This part of Orono's Minnesota's Comprehensive Annual Financial Report presents detailed information as a context for understanding what information in the financial statements, note disclosures, and required supplementary information says about City's overall financial health. Contents Financial Trends These schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time. Revenue Capacity These schedules contain information to help the reader assess the City's most significant local revenue source, the property tax. Debt Capacity These schedules contain information to help the reader assess the affordability of the City's current level of outstanding debt and the City'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 the City which the City's financial activities take place. Operating Information These schedules contain service and infrastructure data to help the reader understand how the information in the City's financial report relates to services the Township provides and activities it performs. CITY OF ORONO NET POSITION BY COMPONENT LAST TEN FISCAL YEARS (ACCRUAL BASIS OF ACCOUNTING) (74) 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Governmental Activities: Net Investment in Capital Assets $ 7,456,522 $ 11,535,032 $ 12,059,075 $ 11,373,668 $ 10,855,727 $ 10,720,258 $ 14,269,848 $ 16,660,990 $ 19,020,035 $ 23,370,988 Restricted. 2,724,688 2,118,273 3,283,445 3,279,963 3,596,762 3,535,595 3,835,852 9,046,977 3,699,095 3,434,418 Unrestricted 10,321,261 6,207,780 5,995,237 7,159,290 7,777,232 9,616,862 3,740,883 (3,794,950) 894,132 (840,224) Total Governmental Activities Net Position $ 20,502,471 $ 19,861,085 $ 21,337,757 $ 21,812,921 $ 22,229,721 $ 23,872,715 $ 21,846,583 $ 21,913,017 $ 23,613,262 $ 25,965,182 Business -Type Activities: Net Investment in Capital Assets $ 15,251,329 $ 15,144,730 $ 15,027,930 $ 15,393,009 $ 15,586,266 $ 16,042,333 $ 15,505,885 $ 16,427,467 $ 16,940,333 $ 17,917,465 Unrestricted 4,072,009 5,885,807 6,375,719 6,196,614 6,105,512 5,946,733 6,411,818 6,001,307 5,687,684 5,086,696 Total Business -Type Activities Net Position $ 19,323,338 $ 21,030,537 $ 21,403,649 $ 21,589,623 $ 21,691,778 $ 21,989,066 $ 21,917,703 $ 22,428,774 $ 22,628,017 $ 23,004,161 Primary Government: Net Investment in Capital Assets $ 22,707,851 $ 26,679,762 $ 27,087,005 $ 26,766,677 $ 26,441,993 $ 26,762,591 $ 29,775,733 $ 33,088,457 $ 35,960,368 $ 41,288,453 Restricted 2,724,688 2,118,273 3,283,445 3,279,963 3,596,762 3,535,595 3,835,852 9,046,977 3,699,095 3,434,418 Unrestricted 14,393,270 12,093,587 12,370,956 13,355,904 13,882,744 15,563,595 10,152,701 2,206,357 6,581,816 4,246,472 Total Primary Government Net Position $ 39,825,809 $ 40,891,622 $ 42,741,406 $ 43,402,544 $ 43,921,499 $ 45,861,781 $ 43,764,286 $ 44,341,791 $ 46,241,279 $ 46,969,343 (74) Expenses: Governmental Activities: General Government Public Safety Streets Parks and Recreation Recycling Miscellaneous Interest and Fiscal Charges Total Governmental Activities Expenses Business -Type Activities: Water Sewer Storm Water Recycling Cable Television Interest and Fiscal Charges Total Business -Type Activities Expenses Total Primary Government Expenses Program Revenues: Governmental Activities: Charges for Services: General Government Public Safety Streets Parks and Recreation Recycling Operating Grants and Contributions Capital Grants and Contributions Total Governmental Activities Program Revenues Business -Type Activities: Charges for Services: Water Sewer Storm Water Recycling Cable Television Operating Grants and Contributions Capital Grants and Contributions Total Business -Type Activities Program Revenues Total Primary Government Program Revenues CITY OF ORONO CHANGES IN NET POSITION LAST TEN FISCAL YEARS (ACCRUAL BASIS OF ACCOUNTING) 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 $ 1,941,927 $ 1,899,808 $ 1,951,621 $ 1,836,682 $ 1,931,772 $ 1,719,267 $ 1,864,543 $ 2,314,539 $ 2,722,779 $ 1,947,411 3,840,633 3,557,976 3,382,389 3,317,261 4,526,574 4,984,389 5,107,619 6,263,133 5,486,330 5,661,624 605,719 579,551 1,060,426 1,194,986 1,610,302 854,079 999,097 752,976 393,354 2,131,198 106,379 100,731 285,897 270,356 279,796 254,177 324,731 413,797 420,410 465,170 97,920 100,352 106,649 104,046 - - - - - - 350,111 317,525 341,008 324,633 413,935 287,181 283,146 258,874 173,552 155,122 6,942,689 6,555,943 7,127,990 7,047,964 8,762,379 8,099,093 8,579,136 10,003,319 9,196,425 10,360,525 468,540 480,513 417,843 473,191 514,522 556,766 581,758 634,562 680,595 915,730 1,084,959 1,046,396 1,088,467 1,161,273 1,136,040 1,184,629 1,332,617 1,401,278 1,429,209 1,381,752 136,527 94,247 108,399 126,294 145,907 186,719 163,747 225,113 190,935 143,194 215,343 206,702 - - 114,837 114,983 116,642 118,054 126,333 127,044 - - - - - 12,675 31,802 31,724 48,684 51,943 7,604 5,705 1,900 899 1,905,369 1,835,462 1,620,414 1,762,658 1,912,205 2,055,772 2,226,566 2,410,731 2,475,756 2,619,663 $ 8,848,058 $ 8,391,405 $ 8,748,404 $ 8,810,622 $ 10,674,584 $ 10,154,865 $ 10,805,702 $ 12,414,050 $ 11,672,181 $ 12,980,188 $ 349,569 $ 549,384 $ 551,026 $ 482,883 $ 646,284 $ 692,254 $ 736,643 $ 770,750 $ 947,851 $ 1,147,449 1,253,416 1,183,879 1,035,105 909,170 2,544,587 2,570,751 2,737,342 2,720,584 2,947,439 3,102,546 2,368 3,495 18,149 165,503 128,402 2,998 3,933 5,108 385 5,826 - 38,850 258,250 129,918 149,994 207,977 499,083 420,184 195,449 389,206 75,073 75,272 77,455 81,224 - - - - - - 451,329 486,881 715,225 586,891 627,650 925,968 732,114 671,059 1,174,782 1,741,370 77,478 721,962 18,806 11,187 22,060 13,549 1,070 609 820,165 2,131,755 2,415,239 3,377,172 2,374,395 4,108,104 4,422,008 4,722,664 4,588,755 5,266,515 7,206,562 420,963 382,864 401,765 502,864 436,770 452,429 492,947 594,198 629,736 699,562 980,619 1,055,620 1,085,540 1,107,357 1,206,926 1,200,043 1,297,786 1,505,467 1,408,480 1,477,225 143,621 240,258 250,197 242,563 314,415 318,787 527,255 538,870 289,643 421,838 166,084 140,891 - - 110,912 113,501 128,387 142,470 140,218 136,922 - - - - - 71,412 99,632 77,511 76,352 78,716 - - - - - 34,500 34,500 34,500 - 34,500 60,000 165,316 19,133 495 178,371 16,765 45,218 7,400 1,711,287 1,879,633 1,902,818 1,871,917 2,069,518 2,369,043 2,597,272 2,893,016 2,589,647 2,856,163 $ 3,843,042 $ 4,294,872 $ 5,279,990 $ 4,246,312 $ 6,177,622 $ 6,791,051 $ 7,319,936 $ 7,481,771 $ 7,856,162 $ 10,062,725 (75) CITY OF ORONO CHANGES IN NET POSITION (CONTINUED) LAST TEN FISCAL YEARS (ACCRUAL BASIS OF ACCOUNTING) (76) 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Net Revenue (Expense): Governmental Activities $ (4,810,934) $ (4,140,704) $ (3,750,818) $ (4,673,569) $ (4,654,275) $ (3,677,085) $ (3,856,472) $ (5,414,564) $ (3,929,910) $ (3,153,963) Business -Type Activities 228,492 44,171 282,404 109,259 157,313 313,271 370,706 482,285 113,891 236,500 Total Primary Government Net Expense $ (4,582,442) _L_L,096,5331 $ (3,468,414) $ (4,564,310) $ (4,496,962) $ (3,363,814) $ (3,485,766) $ (4,932,279) $ (3,816,019) $ (2,917,463) General Revenues and Other Changes in Net Position: Governmental Activities: Property Taxes $ 4,546,038 $ 4,364,416 $ 4,728,470 $ 4,716,941 $ 4,746,856 $ 4,809,875 $ 4,819,345 $ 5,021,340 $ 5,268,854 $ 5,510,133 Unrestricted Grants and Contributions - - - - - - - - - - Other General Revenues 526,115 293,916 186,397 139,494 214,876 17,337 44,051 149,388 53,207 193,279 Investment Earnings 219,268 215,289 121,403 126,298 (81,067) 215,606 144,252 109,752 114,356 132,799 Gain (Loss) on Sale of Capital Assets 11,592 22,369 20,813 - 24,410 7,961 6,466 45,518 38,738 - Transfers 11,300 (1,396,672) 170,407 166,000 166,000 269,300 320,209 155,000 155,000 (41,000) Total Governmental Activities 5,314,313 3,499,318 5,227,490 5,148,733 5,071,075 5,320,079 5,334,323 5,480,998 5,630,155 5,795,211 Business -Type Activities: Other General Revenues 85,531 203,874 201,462 183,619 130,550 163,719 141,546 160,967 185,909 79,683 Investment Earnings 165,563 62,482 59,653 59,096 (19,708) 124,098 67,076 57,319 54,443 51,588 Transfers (11,300) 1,396,672 (170,407) (166,000) (166,000) (269,300) (320,209) (155,000) (155,000) 41,000 Total Business -Type Activities 239,794 1,663,028 90,708 76,715 (55,158) 18,517 (111,587) 63,286 85,352 172,271 Total Primary Government $ 5,554,107 $ 5,162,346 $ 5,318,198 $ 5,225,448 $ 5,015,917 $ 5,338,596 $ 5,222,736 $ 5,544,284 $ 5,715,507 $ 5,967,482 Change in Net Position: Governmental Activities $ 503,379 $ (641,386) $ 1,476,672 $ 475,164 $ 416,800 $ 1,642,994 $ 1,477,851 $ 66,434 $ 1,700,245 $ 2,641,248 Business -Type Activities 468,286 1,707,199 373,112 185,974 102,155 331,788 259,119 545,571 199,243 408,771 Total Primary Government $ 971,665 $ 1,065,813 $ 1,849,784 $ 661,138 $ 518,955 $ 1,974,782 $ 1,736,970 $ 612,005 $ 1,899,488 $ 3,050,019 (76) CITY OF ORONO FUND BALANCES, GOVERNMENTAL FUNDS LAST TEN FISCAL YEARS (MODIFIED ACCRUAL BASIS OF ACCOUNTING) Fiscal Year 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 General Fund: Reserved $ 29,134 $ 19,586 $ $ $ $ $ $ $ $ Unreserved 3,288,032 3,250,931 Nonspendable - - 31,213 66,296 30,909 40,532 74,800 25,376 13,277 118,170 Unassigned 3,509,254 3,133,691 3,354,809 3,886,128 4,233,687 4,400,222 4,433,559 4,336,396 Total General Fund $ 3,317,166 $ 3,270,517 $ 3,540,467 $ 3,199,987 $ 3,385,718 $ 3,926,660 $ 4,308,487 $ 4,425,598 $ 4,446,836 $ 4,454,566 All Other Governmental Funds: Reserved $ 2,193,401 $ 3,362,303 $ - $ - $ - $ - $ - $ - $ - $ - Unreserved, Reported in: Special Revenue Funds 3,444,473 989,749 Capital Projects Funds 2,946,403 6,682,480 Debt Service Funds - (4,407) - Nonspendable - 1,189 - - - - - - Restricted 5,924,524 4,912,412 3,455,223 3,625,599 3,957,346 6,383,149 3,685,145 3,495,176 Assigned 3,646,933 3,888,083 4,133,893 4,029,776 2,951,616 3,358,915 3,148,848 2,403,358 Unassigned (178,573) (872,147) (1,050,959) (2,759,730) Total All Other Governmental Funds $ 8,584,277 $ 11,030,125 $ 9,571,457 $ 8,801,684 $ 7,589,116 $ 7,655,375 $ 6,730,389 $ 8,869,917 $ 5,783,034 $ 3,138,804 Source: City's financial records. Note: The City began to use new categories when it implemented GASB 54 in fiscal year 2011. Prior years were not retroactively reclassified. (77) Revenues: Taxes Licenses and Permits Intergovernmental Charges for Services Fines Investment Earnings Special Assessments Miscellaneous Total Revenues Expenditures: General Government Public Safety Streets Parks and Recreation Recycling Other Capital Outlay Debt Service: Principal Interest Total Expenditures Excess of Revenues Over (Under) Expenditures Other Financing Sources (Uses): Transfers In Transfers Out Refunding Bonds Issued Bondslssued Premium on Bonds Issued Discount on Issued Debt Payment of Refunded Bonds Capital Lease Proceeds Sales of Capital Assets Total Other Financing Sources (Uses) Net Change in Fund Balances Debt Service as a Percentage of Noncapital Expenditures CITY OF ORONO CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS LAST TEN FISCAL YEARS Fiscal Year 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 $ 4,557,765 $ 4,742,169 $ 4,761,488 $ 4,724,264 $ 4,785,052 $ 4,840,777 $ 4,839,722 $ 5,057,941 5,258,546 $ 5,448,238 394,069 411,155 592,111 509,300 613,184 675,204 846,343 715,281 613,218 954,278 260,254 472,366 542,711 393,148 421,485 745,062 545,236 496,497 1,025,044 1,616,583 1,349,988 1,212,527 1,029,515 979,122 2,474,211 2,569,831 2,896,458 2.,973,534 3,165,196 3,211,749 140,621 182,719 141,304 159,673 175,321 153,821 134,754 133,354 101,824 124,060 219,268 199,131 110,215 114,624 61,335 195,862 133,204 97,843 105,079 122,659 160,615 193,865 272,772 115,518 68,413 62,632 70,349 8,537 2,226 22,935 84,143 66,063 74,676 255,633 205,078 58,012 64,867 143,976 66,122 171,219 7,166,723 7,479,995 7,524,792 7,251,282 8,804,079 9,301,201 9,530,933 9,626,963 10,337,255 11,671,721 1,456,632 1,441,065 1,294,803 1,263,916 1,242,028 1,282,487 1,285,064 1,362,293 1,474,265 1,433,076 3,548,678 3,501,180 3,402,270 3,248,071 4,734,635 4,906,572 4,906,117 5,073,430 5,298,939 5,628,086 496,787 450,403 458,040 425,192 508,544 454,964 496,239 480,765 486,138 595,740 65,991 58,498 241,789 238,424 255,395 231,356 268,831 281,340 304,333 421,996 97,920 100,352 106,649 104,046 - 4,572 - - 1,590 - 2,225,166 810,071 758,654 1,795,760 1,683,159 3,973,460 2,114,343 1,721,077 2,150,260 5,771,819 801,953 925,000 2,285,000 1,110,000 1,145,000 1,900,000 1,010,000 1,085,788 3,556,024 660,000 413,303 321,682 357,525 362,629 328,633 302,728 331,317 344,562 237,286 187,404 9,106,430 7,608,251 8,904,730 8,548,038 9,897,394 13,056,139 10,411,911 10,349,255 13,508,835 14,698,121 (1,939,707) (128,256) (1,379,938) (1,296,756) (1,093,315) (3,754,938) (880,978) (722,292) (3,171,580) (3,026,400) 1,299,776 3,063,840 530,407 1,752,437 866,000 905,848 1,451,397 1,565,385 1,262,405 1,486,307 (1,288,476) (4,998,351) (360,000) (1,586,437) (700,000) (636,548) (1,131,188) (1,410,385) (1,107,405) (1,217,307) - 1,195,000 - - - - - 2,680,000 - - 1,120,000 3,120,000 - - - 4,070,177 - - - - 12,946 110,597 - - - - - 94,956 - - (1,095,000) - - - - - - - - - - 14,000 - - - - - - - - 11,592 22,369 20,813 20,503 30,110 22,662 17,610 48,975 38,738 33,097 60,838 2,527,455 191,220 186,503 196,110 4,362,139 337,819 2,978,931 193,738 302,097 $ (1,878,869) $ 2,399,199 $ (1,188,718) $ (1,110,253) $ (897,205) $ 607,201 $ (543,159) $ 2,256,639 $ (2,977,842) $ (2,724,303) 17.0% 18.3% 31.2% 20.1% 16.5% 24.2% 15.8% 16.4% 33.7% 8.6% (78) CITY OF ORONO TAX CAPACITY VALUE AND ESTIMATED MARKET VALUE OF TAXABLE PROPERTY LAST TEN FISCAL YEARS (79) Residential Commercial Industrial Fiscal Year Property Property Property 2009 $ 2,917,611,900 $ 66,468,700 $ 8,308,300 2010 2,694,887,700 60,108,100 7,692,800 2011 2,504,169,400 56,939,100 7,672,400 2012 2,319,999,400 54,284,700 7,771,200 2013 2,353,751,300 53,032,100 9,618,500 2014 2,367,078,691 52,385,700 11,937,300 2015 2,468,589,098 50,003,300 12,831,100 2016 2,664,593,042 51,885,300 14,602,600 2017 2,810,505,878 53,590,300 15,428,800 2018 2,932,517,796 49,881,300 20,720,700 Source: Hennepin County Assessing Department 32,961,379 16.759 (79) Assessed Value as a Total Total Direct Percentage of Market Value Taxable Value Tax Rate Actual Value $ 2,992,388,900 $ 34,342,939 13.183 1.15% 2,762,688,600 31,561,399 13.677 1.14 2,568,780,900 29,065,900 14.991 1.14 2,382,055,300 26,790,406 16.283 1.12 2,416,401,900 26,531,505 17.667 1.10 2,431,401,691 27,566,309 17.815 1.13 2,531,423,498 28,749,183 17.387 1.14 2,731,080,942 28,351,935 17.325 1.04 2,879,524,978 32,961,379 16.759 1.14 3,003,119,796 34,422,178 16,555 1.15 (79) CITY OF ORONO DIRECT AND OVERLAPPING TAX RATES LAST TEN FISCAL YEARS Source: Hennepin County Assessing Department Total Direct City of Orono Overlapping Rates and Hennepin Special Overlapping Fiscal Year Operating Debt Service Total City ISD No. 278 County Districts Rates 2009 11.153 2.030 13.183 17.492 40.413 8.643 79.731 2010 11.415 2.262 13.677 17.013 42.640 9.649 82.979 2011 12.552 2.439 14.991 19.380 45.840 10.841 91.052 2012 13.634 2.649 16.283 19.939 48.231 11.228 95.681 2013 14.826 2.841 17.667 22.325 49.461 11.858 101.311 2014 14.951 2.864 17.815 22.802 49.959 12.367 102.943 2015 14.633 2.754 17.387 22.601 46.398 9.785 96.171 2016 14.685 2.640 17.325 23.166 45.356 9.520 95.367 2017 14.328 2.431 16.759 23.352 44.087 11.057 95.255 2018 14.391 2.164 16.555 24.024 42.808 10.667 94.054 Source: Hennepin County Assessing Department CITY OF ORONO PRINCIPAL PROPERTY TAXPAYERS CURRENT YEAR AND NINE YEARS AGO Source: Hennepin County Assessor's Office (81) 2018 2009 Percentage of Percentage of Total Tax Total Tax Taxpayer Tax Capacity Rank Capacity Tax Capacity Rank Capacity Private Residence $ 223,500 1 0.65% $ 187,438 1 0.55% Private Residence 140,925 2 0.41 182,132 2 0.53 Private Residence 116,013 3 0.34 176,060 3 0.51 Private Residence 115,903 4 0.34 147,741 4 0.43 TonkaHome Holdings LLC 106,625 5 0.31 - - Private Residence 104,438 6 0.30 145,507 5 0.42 Private Residence 101,938 7 0.30 132,935 6 0.39 WJM Properties LLC 99,990 8 0.29 116,090 9 0.34 Private Residence 92,638 9 0.27 121,763 8 0.35 Private Residence 91,258 10 0.27 107,500 10 0.31 Wayzata County Club 124,630 7 0.36 Total $ 1,193,228 3.47% $ 1,441,796 4.19% Source: Hennepin County Assessor's Office (81) CITY OF ORONO PROPERTY TAX LEVIES AND COLLECTIONS LAST TEN FISCAL YEARS In 2016 and 2017 the City collected slightly more taxes than they levied for as some residents chose to prepay their property taxes (82) Collected Within the Fiscal Fiscal Year Total Tax Year of the Levy Collections in Total Collections to Date Ended Levy for Percentage Subsequent Percentage December 31, Fiscal Year Amount of Levy Years Amount of Levy 2009 $ 4,564,687 $ 4,415,151 96.72 $ 149,536 $ 4,564,687 100.00 % 2010 4,665,880 4,518,619 96.84 147,261 4,665,880 100.00 2011 4,702,558 4,599,372 97.81 103,186 4,702,558 100.00 2012 4,702,558 4,632,847 98.52 69,711 4,702,558 100.00 2013 4,701,760 4,677,698 99.49 24,062 4,701,760 100.00 2014 4,743,144 4,701,760 99.13 40,176 4,741,936 99.97 2015 4,772,000 4,748,327 99.50 22,221 4,770,548 99.97 2016 4,954,480 4,968,026 100.27 (17,500) 4,950,526 99.92 2017 5,205,230 5,235,100 100.57 (42,359) 5,192,741 99.76 2018 5,439,951 5,379,375 98.89 5,379,375 98.89 In 2016 and 2017 the City collected slightly more taxes than they levied for as some residents chose to prepay their property taxes (82) Fiscal Year 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 CITY OF ORONO RATIOS OF OUTSTANDING DEBT BY TYPE LAST TEN FISCAL YEARS Governmental Activities General Percentage Obligation Public Capital Bonds Facility Bonds Leases $ 6,015,000 $ 3,660,000 $ - $ 9,850,000 3,215,000 13,398 9,365,000 1,415,000 10,928 8,430,000 1,240,000 8,357 7,470,000 1,055,000 5,682 10,620,000 - 17,374 9,610,000 10,816,812 11,812 11,431,701 12, 576,282 6,024 7,660,000 8,705,000 - 7,000,000 7,965,000 1.03 Business -Type Activities General Obligation Revenue Bonds Bonds (83) 1,280,000 1,195,000 1,138, 557 1,045,000 965,000 Percentage Total Primary of Personal Government Income (1) Per Capita (1) $ 9,675,000 1.87 % 1,204 13,078,398 2.52 1,759 10,790,928 2.32 1,451 9,678,357 2.08 1,303 8,530,682 1.46 1,125 11, 917, 374 1.99 1,566 10,816,812 2.14 1,389 12, 576,282 1.84 1,635 8,705,000 1.20 1,068 7,965,000 1.03 983 CITY OF ORONO RATIOS OF GENERAL BONDED DEBT OUTSTANDING LAST TEN FISCAL YEARS (84) Governmental Business -Type Percentage of Activities Activities Less Amounts Estimated Actual General General Available in Debt Taxable Value Fiscal Year Obligation Bonds Obligation Bonds Service Fund Total of Property (1) Per Capita (2) 2009 9,675,000 2,193,401 7,481,599 0.25 938 2010 13,065,000 3,262,816 9,802,184 0.36 1,318 2011 10,780,000 1,972,796 8,807,204 0.34 1,184 2012 8,430,000 1,898,787 6,531,213 0.28 879 2013 7,470,000 - 1,571,736 5,898,264 0.24 778 2014 10,620,000 1,189,565 9,430,435 0.39 1,239 2015 9,610,000 1,195,000 2,209,951 8,595,049 0.34 1,104 2016 11,431,701 1,138,557 7,550,955 5,019,303 0.18 653 2017 7,660,000 1,045,000 1,854,112 6,850,888 0.24 841 2018 7,000,000 965,000 2,080,923 5,884,077 0.20 726 (1) See the Schedule of Assessed Value and Estimated Actual Value of Taxable Property for property value data. (2) Population data can be found in the Schedule of Demographic and Economic Statistics. Details regarding the City's outstanding debt can be found in the notes to basic financial statements. (84) CITY OF ORONO DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT DECEMBER 31, 2018 Governmental Unit Direct Debt: City of Orono Overlapping Debt: School Districts: Total Debt Outstanding Sinking Funds 7,000,000 $ 2,080,923 $ Estimated Estimated Share Percentage of Overlapping Net Debt Applicable Debt 4,919,077 100.00 % $ 4,919,077 ISD No. 278 (Orono) 73,125,000 1,062,337 72,062,663 51.53 37,133,890 ISD No. 276 (Minnetonka) 109,525,000 6,937,047 102,587,953 0.20 205,176 ISD No. 277 (Westonka) 43,065,000 631,657 42,433,343 27.13 11,512,166 ISD No. 284 (Wayzata) 220,160,000 10,823,806 209,336,194 0.97 2,030,561 Hennepin County 1,058,135,000 1,244,202 1,056,890,798 1.93 20,397,992 Hennepin Suburban Park 59,085,000 15,509,292 43,575,708 2.70 1,176,544 Hennepin Regional RR Authority 29,865,000 5,264,620 24,600,380 2.70 664,210 Metropolitan Council 189,310,976 113,408,287 75,902,689 0.99 751,437 Total Overlapping Debt 1,782,270,976 154,881,248 1,627,389,728 73,871,977 Total Direct and Overlapping Debt $ 78,791,054 (1) The percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable percentages were estimated by determining the portion of the county's taxable assessed value that is within the government's boundaries and dividing it by the county's total taxable assessed value. 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 recognizes 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. Source 1: Hennepin County Source 2: Assessed value data used to estimate applicable percentages provided by the County Board of Equalization and Assessment. Debt outstanding data provided by the county. (85) Debt Limit Total Net Debt Applicable to Limit Legal Debt Margin Total Net Debt Applicable to the Limit as a Percentage of Debt Limit CITY OF ORONO LEGAL DEBT MARGIN INFORMATION LAST TEN FISCAL YEARS Fiscal Year 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 $ 90,720,357 $ 82,824,237 $ 77,063,427 $ 71,461,659 $ 72,492,057 $ 72,942,051 $ 75,942,705 $ 81,932,428 $ 86,385,749 $ 90,093,594 7,481,599 9,802,184 9,014,895 6,898,136 6,319,308 10,660,892 8,714,780 8,062,670 8,705,000 5,884,077 $ 83,238,758 $ 73,022,053 $ 68,048,532 $ 64,563,523 $ 66,172,749 $ 62,281,159 $ 67,227,925 $ 73,869,758 $ 77,680,749 $ 84,209,517 8.25% 11.83% 11.70% 9.65% 8.72% 14.62% 11.48% Legal Debt Margin Calculation for Fiscal Year 2018 Market Value Debt Limit (3% of Market Value)" Debt Applicable to Limit: General Obligation Bonds Less Amount Set Aside for Repayment of General Obligation Debt Total Net Debt Applicable to Limit Legal Debt Margin No 9.84% 10.08% 6.53% $ 3,003,119,796 90,093,594 7,965,000 2,080,923 5,884,077 $ 84,209,517 CITY OF ORONO PLEDGED REVENUE LAST TEN FISCAL YEARS (87) Water Revenue Bonds Less Operating Net Available Debt Service Fiscal Year Gross Revenues Expenses Revenue Principal Interest Coverage 2008 $ $ $ - $ $ 2009 - 2010 - 2011 - - 2012 - - 2013 - - 2014 - - 2015 615,569 577,320 38,249 85,000 31,680 0.33 2016 706,460 624,253 82,207 75,000 74,044 0.55 2017 746,514 643,048 103,466 75,000 25,181 1.03 2018 714,159 818,330 (104,171) 80,000 21,480 (1.03) (87) CITY OF ORONO DEMOGRAPHIC AND ECONOMIC STATISTICS LAST TEN FISCAL YEARS Note: Information on education level was only available in 2010 census data Education Per Capita Fiscal Population Estimated Personal Year (1) Personal Income Income 2009 7,980 516,313,980 64,701 2010 7,437 518,009,361 69,653 2011 7,437 464,396,028 62,444 2012 7,428 572,416,536 77,062 2013 7,584 584,726,400 77,100 2014 7,611 597,463,500 78,500 2015 7,785 506,281,905 65,033 2016 7,691 685,014,271 89,067 2017 8,147 724,455,244 88,923 2018 8,102 77,019,234 95,062 Note: Information on education level was only available in 2010 census data Data sources (1) Metropolitan Council Estimate in non -census years. 2010 based on census data. 2017 based on U.s. Census Estimate (2) Hennepin County average/median for non -census years. 2010 based on census data. (3) Minnesota Department of Education, as reported by ISD No. 278 (Orono). (4) Minnesota Department of Economic Security; Hennepin County average for non -census years. 2010 based on census data. Education Level in Years School Median of Formal Enrollment Unemployment Age (2) Schooling (3) Rate (4) 41 - 2,708 6.7 45 15 2,765 2.9 35 - 2,706 5.3 45 2,711 4.8 46 2,760 4.6 46 2,757 2.9 46 2,808 2.8 43 2,790 3.3 47 2,807 2.6 47 2,820 2.5 Data sources (1) Metropolitan Council Estimate in non -census years. 2010 based on census data. 2017 based on U.s. Census Estimate (2) Hennepin County average/median for non -census years. 2010 based on census data. (3) Minnesota Department of Education, as reported by ISD No. 278 (Orono). (4) Minnesota Department of Economic Security; Hennepin County average for non -census years. 2010 based on census data. Employer ISD No. 278 (Orono) Wayzata Country Club Woodhill Country Club Jem Technical Otten Brothers Lunds Culver's City of Orono Springhill Country Club Morries' Automotive Service 800 Snyders Total Source: City of Orono and State Department of Commerce CITY OF ORONO PRINCIPAL EMPLOYERS CURRENT YEAR AND NINE YEARS AGO 2018 WE 2009 Percentage Percentage of Total City Employees Rank Employment 346 1 19.22 % 248 2 13.78 180 3 10.00 104 4 5.78 98 5 5.44 75 6 4.17 60 7 3.33 54 8 3.00 45 9 2.50 28 10 1.56 1,238 68.78 % WE 67.07 % 2009 Percentage of Total City Rank Employment 1 22.67 % 2 14.27 4 6.67 3 6.67 5 4.33 8 3.73 6 2.27 7 3.00 9 2.00 10 1.46 67.07 % CITY OF ORONO FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION LAST TEN FISCAL YEARS Fiscal Year .m 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Function: General Government 7.0 7.0 7.0 7.0 7.0 6.8 7.8 8.0 8.0 8.0 Public Safety: Police: Officers 18.5 18.0 16.5 16.5 30.0 28.0 27.0 27.0 27.0 30.0 Civilians 3.7 3.7 3.0 3.0 4.0 4.0 4.0 4.0 4.0 4.0 Code Enforcement 6.6 6.6 5.6 5.6 5.6 6.0 6.0 5.0 4.0 5.0 Public Works 3.5 3.5 3.5 4.5 4.5 4.5 4.5 4.5 4.5 5.0 Parks (1) - - - - - - - - - 0.5 Water 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 2.5 Sewer 2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5 Storm Water 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 Golf 3.0 3.0 3.0 3.0 3.0 5.0 5.0 5.0 5.0 3.0 Total 46.8 46.3 43.1 44.1 58.6 58.8 58.8 58.0 57.0 61.0 Note: This table shows 61 employees while the Principal Employers schedule shows 54 due to part time employees included within the table above. Source: City Budget Office (1): Separated Parks department in 2018 due to hiring Park Supervisor at the end of 2017 .m CITY OF ORONO OPERATING INDICATORS BY FUNCTION LAST TEN FISCAL YEARS Fiscal Year (91) 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Function: Public Safety: Police: Initial Reports 6,217 6,573 5,728 6,688 12,128 10,990 10,056 9,320 6,462 5,875 Citations 2,572 2,543 2,086 1,982 3,228 2,437 1,495 1,929 1,509 1,675 Building/Zoning: Building Permits Issued 343 549 858 441 449 485 470 466 518 535 Land Use Applications 40 38 35 48 24 56 63 59 110 81 Water: Connections 984 1,005 998 1,003 1,036 1,036 1,023 1,036 1,041 1,087 Radio Read Meters - Start 2004 573 720 808 927 1,001 1,036 1,010 1,024 1,029 1,072 Annual Water Pumped (Thousands of Gallons) 129,277 107,831 116,370 125,005 108,486 96,066 95,701 96,936 108,627 108,923 Wastewater: Connections 2,189 2,173 2,215 2,231 2,225 2,218 2,238 2,243 2,256 2,287 Annual Sewer Flow (Thousands of Gallons) (2) 172,300 172,780 173,649 177,360 186,310 190,710 201,000 211,900 173,840 195,420 Storm Water: Sweeping (Centerline Miles) (1) 46 46 46 46 46 46 46 46 92 46 Drainage Projects 1 - 2 1 1 1 1 3 3 7 Golf: Rounds Played 14,771 13,927 12,041 10,607 6,990 10,890 14,334 11,976 11,387 7,007 Sources: Various City departments (1) Historical data is based on the miles of roads that was included in each sweeping. 2017 data is based on the miles of road that was swept in total. (2) 2017 data received from Metropolitan Council. (91) CITY OF ORONO CAPITAL ASSET STATISTICS BY FUNCTION LAST TEN FISCAL YEARS Fiscal Year 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Function: Public Safety: Police: Stations 1 1 1 1 1 1 1 1 1 1 Patrol Units 11 11 11 11 14 14 14 14 14 14 Fire Stations 1 1 1 1 1 1 1 1 1 1 Streets: Streets (Miles) 46 46 46 46 46 46 46 46 46 46 Streetlights (1) 135 135 135 135 135 135 135 135 135 135 Parks: Parks Acreage (2) 197 197 228 228 228 228 228 228 228 228 Parks 21 21 22 22 22 22 22 22 22 22 Beaches 4 4 4 4 4 4 4 4 4 4 Water: Water Mains (Miles) 18 18 18 18 18 18 18 18 23 23 Water Plants 2 2 2 2 2 2 2 2 2 2 Wells 3 3 3 3 3 3 3 4 4 4 Maximum Daily Capacity (Thousands of Gallons) 2,160 2,160 2,160 2,160 2,160 2,160 2,160 3,800 3,800 3,800 Sewer: Sanitary Sewers (Miles) 47 47 47 47 47 47 47 47 61 61 Pumping Stations 45 46 46 46 46 46 46 46 46 45 Golf: Clubhouse 1 1 1 1 1 1 1 1 1 1 Holes 9 9 9 9 9 9 9 9 9 9 (1) Historical streetlights was adjusted to reflect updated information (2) Historical park acreage was adjusted to reflect updated information Note: No capital asset indicators are available for the general government functions. Sources: Various City departments (92) CliftonLersonAllen LLP �Twjk CLAconnect.com Honorable Mayor and Members of the City Council City of Orono Orono, Minnesota We have audited the financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of City of Orono (the City) for the year ended December 31, 2018, and have issued our report thereon dated August 14, 2019. We have previously communicated to you information about our responsibilities under auditing standards generally accepted in the United States of America and Government Auditing Standards, as well as certain information related to the planned scope and timing of our audit. Professional standards also require that we communicate to you the following information related to our audit. Significant audit findings Qualitative aspects of accounting practices Accounting policies Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in Note 1 to the financial statements. As described in the Notes, during the fiscal year ended December 31, 2018, the City changed accounting policies related to its accounting for pensions by adopting Statement of Governmental Accounting Standards (GASB) Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other than Pensions. During the fiscal year ended December 31, 2018, the City also early -adopted Statement of Governmental Accounting Standards (GASB) Statement No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period. As a result implementing GASB No. 75, the City's beginning net position was restated to reflect the adjusted OPEB liability at December 31, 2017. There was no significant effect on the financial statements as a result of implementing GASB No. 89. The implementation of this standard increased the 2017 ending OPEB liability by $289,328 and is the cause of our prior period adjustment within the financial statements shown on the Statement of Net Position. The OPEB footnote is also more in depth and is required to include additional information that was not required under the previous standard. We noted no transactions entered into by the City during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period. Accounting estimates Accounting estimates are an integral part of the financial statements prepared by management and are based on management's knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the financial statements were: �A member of Nexia International Honorable Mayor and Members of the City Council City of Orono Page 2 • Management's estimate of the depreciation expense on capital assets is based on management's estimated useful lives of those assets. We evaluated the key factors and assumptions used to develop the depreciation expense estimate in determining that it is reasonable in relation to the financial statements taken as a whole. • Management's estimate of the value of investments is based on published market values as of December 31, 2018. We evaluated the key factors and assumptions used to value investments in determining that it is a reasonable estimate in relation to the financial statements taken as a whole. • Management's estimate of the liability for other post -employment benefits is based on various actuarial assumptions. We evaluated the actuarial assumptions used to develop the liability in determining that it is reasonable in relation to the financial statements taken as a whole. • Management's estimate of the liability for compensated absences is based on employee wage information and the City's policies of earning vacation and sick pay. We evaluated the assumptions used to develop the liability in determining that it is reasonable in relation to the financial statements taken as a whole. • Management's estimate of the City's proportionate share of PERA's GERF and PEPFF net pension liabilities as well as the related deferred inflows and outflows is based on guidance from GASB Statement No. 68, GASB Statement No. 71, and the plans' allocation tables. The plans' allocation tables allocate a portion of the plans' net pension liabilities based on the City's contributions during the plans' fiscal years as a percentage of total contributions received for the related fiscal year by the plans. Financial statement disclosures Certain financial statement disclosures are particularly sensitive because of their significance to financial statement users. There were no particularly sensitive financial statement disclosures. The financial statement disclosures are neutral, consistent, and clear. Difficulties encountered in performing the audit The completion of our audit was delayed slightly due to previous staff vacancy situations which significantly delayed the previous year's audit as well as multiple adjusting journal entries. Uncorrected misstatements Professional standards require us to accumulate all misstatements identified during the audit, other than those that are clearly trivial, and communicate them to the appropriate level of management. Management did not identify and we did not notify them of any uncorrected financial statement misstatements. Honorable Mayor and Members of the City Council City of Orono Page 3 Corrected misstatements The following material misstatements detected as a result of audit procedures were corrected by management: • There was a material audit adjustment to record a debt payment recorded in Fund 322 to Fund 601. The entry posted is as follows: Account # Account Description Debit(Credit) 322-11111 Cash Combined Funds $103,631 322-47000-601 Debt Sry Bond Principal ($80,000) 322-47000-611 Bond Interest ($23,631) 601-23000 Bonds Payable — Noncurrent $80,000 601-23550 Accrued Interest—Payable $666 601-24200 Bond Premium $1,485 601-49400-611 Interest Expense $23,631 601-11111 Cash Combined Funds ($103,631) 601-4400-611 Interest Expense ($2,151) • There was also a material audit adjustment to accrue accounts and contract payable at year end that were not properly accrued for. The entry posted is as follows: 435-48971-590 Street Construction $97,680 435-20200 Accounts Payable ($92,796) 435-20600 Contracts Payable ($4,884) 651-16500 Fixed Asset -Const. in progress $76,778 651-20200 Accounts Payable ($72,939) 651-20600 Contracts Payable ($3,839) • Lastly, there was a material audit adjustment to defer a receivable which was not received within the 60 day revenue recognition period and which was improperly recognized as revenue. The entry posted is as follow: 402-33890 402-22208 Disagreements with management $778,477 ($778,477) For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditors' report. No such disagreements arose during our audit. Management representations We have requested certain representations from management that are included in the management representation letter dated August 14, 2019. Honorable Mayor and Members of the City Council City of Orono Page 4 Management consultations with other independent accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a "second opinion" on certain situations. If a consultation involves application of an accounting principle to the City's financial statements or a determination of the type of auditors' opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants. Significant issues discussed with management prior to engagement We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to engagement as the City's auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our engagement. Other audit findings or issues We have provided a separate letter to you dated August 14, 2019, communicating internal control related matters identified during the audit. Other information in documents containing audited financial statements With respect to the required supplementary information (RSI) accompanying the financial statements, we made certain inquiries of management about the methods of preparing the RSI, including whether the RSI has been measured and presented in accordance with prescribed guidelines, whether the methods of measurement and preparation have been changed from the prior period and the reasons for any such changes, and whether there were any significant assumptions or interpretations underlying the measurement or presentation of the RSI. We compared the RSI for consistency with management's responses to the foregoing inquiries, the basic financial statements, and other knowledge obtained during the audit of the basic financial statements. Because these limited procedures do not provide sufficient evidence, we did not express an opinion or provide any assurance on the RSI. With respect to the Combining and Individual Fund Statements and Schedules (collectively, the supplementary information) accompanying the financial statements, on which we were engaged to report in relation to the financial statements as a whole, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period or the reasons for such changes, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves. We have issued our report thereon dated August 14, 2019. Honorable Mayor and Members of the City Council City of Orono Page 5 Other information in documents containing audited financial statements (continued) Other information is being included in documents containing the audited financial statements and the auditors' report thereon. Our responsibility for such other information does not extend beyond the financial information identified in our auditors' report. We have no responsibility for determining whether such other information is properly stated and do not have an obligation to perform any procedures to corroborate other information contained in such documents. As required by professional standards, we read the statistical section (the other information) in order to identify material inconsistencies between the audited financial statements and the other information. We did not identify any material inconsistencies between the other information and the audited financial statements. Our auditors' opinion, the audited financial statements, and the notes to financial statements should only be used in their entirety. Inclusion of the audited financial statements in a document you prepare, such as an annual report, should be done only with our prior approval and review of the document. This information is intended solely for the use of the City Council and management of the City, and is not intended to be, and should not be, used by anyone other than these specified parties. ZZ ->7? CliftonLarsonAllen LLP Minneapolis, Minnesota August 14, 2019 CliftonLarsonAllen LLP CLAconnect.com r INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Honorable Mayor, Members of the City Council and Management City of Orono Orono, Minnesota We have audited, in accordance with the 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, the financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of City of Orono (the City), as of and for the year ended December 31, 2018, and the related notes to the financial statements, which collectively comprise the City's basic financial statements, and have issued our report thereon dated August 14, 2019. Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered the City's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly, we do not express an opinion on the effectiveness of the City's internal control. Our consideration of internal control was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that have not been identified. However, as described in the accompanying schedule of findings and responses, we did identify certain deficiencies in internal control that we consider to be material weaknesses and significant deficiencies. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. We consider the deficiencies described in the accompanying schedule of findings and responses as items 2018-001, 2018-002, and 2018-003 to be material weaknesses. �A member of Nexia International Honorable Mayor, Members of the City Council and Management City of Orono Page 2 A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness yet important enough to merit attention by those charged with governance. We consider the deficiencies described in the accompanying schedule of findings and responses as item 2018-004 to be a significant deficiency. Compliance and Other Matters As part of obtaining reasonable assurance about whether the City's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. The City's Response to Findings The City's responses to the findings identified in our audit are described in the accompanying schedule of findings and responses. The City's responses were not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on them. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the result of that testing, and not to provide an opinion on the effectiveness of the City's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. 6 ZZ ->7? CliftonLarsonAllen LLP Minneapolis, Minnesota August 14, 2019 Honorable Mayor, Members of the City Council and Management City of Orono Page 3 SCHEDULE OF FINDINGS AND RESPONSES 2018-001 Material Weakness — Annual Financial Reporting under Generally Accepted Accounting Principles (GAAP) Condition: The City does not have an adequate internal control policy in place over annual financial reporting under GAAP, therefore, the potential exists that a misstatement of the annual financial statements could occur and not be prevented or detected by the District's internal controls Criteria: The City must be able to prevent or detect a material misstatement in the annual financial statements, including footnote disclosures. Effect: No effect on current year financial statements. Cause: The City relies on the audit firm to prepare the annual financial statements and related footnote disclosures. However, they have reviewed and approved the annual financial statements and related footnote disclosures. Recommendation: The City should continue to evaluate its internal staff, expertise, and assigned duties to determine if an internal control policy over the annual financial reporting is beneficial. Management Response: Due to the small size of the City's staff and the additional costs necessary to ensure proper controls are in place, the City has decided that the costs of implementing the necessary controls for preparing the City's financial statements outweigh the benefits that would be derived. Nevertheless, the City is continually reviewing the situation and establishes controls that the City believes will aid in the fair presentation of the financial statements without significant increases in the costs of implementing those controls. Honorable Mayor, Members of the City Council and Management City of Orono Page 4 2018-002 Material Weakness - Segregation of Duties Condition: We noted during testing that the City has not properly segregated duties over certain areas. The City Council and management should be aware of this condition and should seek to adequately segregate duties which would reduce the chance of misstatement of the financials due to error or fraud. Criteria: Generally, a system of internal control contemplates separation of duties such that no individual has responsibility to execute a transaction, have physical access to the related assets, and have responsibility or authority to record the transaction. Specifically, we noted the following: Special Assessment and Tax Revenue: The Finance Director maintains the special assessment and tax subsidiary ledgers and also has the rights to make entries to the general ledger. We recommend that the City consider having the Assistant Finance Director maintain the special assessment and tax subsidiary ledger while the Finance Director maintains the general ledger with no access to the subsidiary ledger. In addition to segregating duties, this would create an opportunity to cross -train staff. Wire Transfers: During our review of the process for completing a wire transfer, it was noted that a cover sheet signed by the Finance Director is all that is required to initiate and complete a transfer. This creates a situation where the Finance Director could make an error when making wire transfers and for it to go unnoticed. We recommend that the City work with the bank to require either a second approval prior to processing the wire or implement a notification process which sends a notification to someone other than the Finance Director, such as the City Administrator, immediately after the wire is received by the bank. Effect: The City is unable to maintain segregation of incompatible duties given its current internal control structure. Cause: The City does not have formalized accounting policies that describes the responsibilities of the various accounting personnel and not all controls are properly designed. Recommendation: The City should document the flow of transactions in order to identify staff that may be underutilized in the review or preparation process. This information should be used to design and document the City's internal control and accounting policy manual. Internal control procedures, the policy manual and the review process should be reviewed and monitored periodically by the Council. In making this review, it is important to consider the benefit derived as weighed against the cost of the improvements. Consideration should be given to improving the segregation of duties by utilizing existing staff differently and revising their roles. The City Council should be involved in the oversight process and review the responsibilities periodically. Management Response: Due to the small size of the City's staff and the additional costs necessary to ensure proper controls are in place, the City has decided that the costs of implementing the necessary controls outweigh the benefits that would be derived. Nevertheless, the City is continually reviewing the situation and establishes controls that the City believes will aid in the segregation of duties without significantly increasing the costs of implementing those controls. Honorable Mayor, Members of the City Council and Management City of Orono Page 5 2018-003 Material Weakness — Material Audit Adjustment Condition: We noted that there were debt payments posted to the incorrect fund during our audit process. We also noted there were some accounts payable not properly accrued for at year end as well as revenue not received within 60 days of year end recognized rather than recorded as a deferred inflow as unavailable revenue. Criteria: Generally, there would be a system of internal controls that would catch if a material journal entry were made to the incorrect fund. There should also be internal controls in place to ensure all accounts payable are accrued for at year-end. Effect: Debt Service Entry: Cash was understated and debt service expenditures were overstated in the 2014 GO Improvement Bonds fund by $103,631, while in the Water fund cash and outstanding debt amounts were overstated by $103,631. Accounts Payable Entry: Accounts payable and related expenditures in the Pavement Management Plan fund were understated by $97,680 and Stormwater fund accounts payable and related expenses were understated by $76,778. Deferred inflow entry: revenue was overstated in the Municipal State Aid Streets funds by $778,477. Cause: The City's controls and reconciliations over debt service expenditures, accounts payable, and revenue recognition did not function as expected. Recommendation: We recommend that the city have internal controls in place to ensure that debt payments are posted to the correct fund throughout the year. This could be monitored through the journal entry review process along with the year-end debt reconciliation process and comparison to the year-end trial balance. We also recommend that the city have internal controls in place to ensure that accounts payable are properly accrued for at year-end and revenue is properly deferred if not received timely. This could be monitored through review of disbursements made after year-end to see if the expense is posted to the correct period. Management Response: Management will work to resolve this issue now that they have the appropriate staffing within the finance department. Honorable Mayor, Members of the City Council and Management City of Orono Page 6 2018-004 Significant Deficiency — Check Signing Condition: We noted during our audit that check signers are only reviewing the disbursement listing when signing checks and not any of the support for the disbursements they are approving. Criteria: Generally, a system of internal control will ensure that whoever is approving a purchase has the supporting documentation to ensure that purchase is appropriate in purpose and amount. Effect: There is the potential for the description on the approval listing to be inaccurate and approvers could inadvertently approve an inappropriate disbursement. Cause: The City does not ensure that the people signing the checks have the support for the disbursements they are approving. They also do not have a robust enough review process prior to check signing that would allow the check signers to not worry about this level of detail review. Recommendation: We recommend that the City either implement a system of internal control that ensures someone is reviewing all disbursements prior to those disbursements being made. This review would include reviewing the documentation supporting the disbursement amount and the entity that the funds would be disbursed to. Management Response: Due to the small size of the City's staff and the additional costs necessary to ensure proper controls are in place, the City has decided that the costs of implementing the necessary controls outweigh the benefits that would be derived. Nevertheless, the City is continually reviewing the situation and establishes controls that the City believes will aid in the segregation of duties without significantly increasing the costs of implementing those controls. CliftonLarsonAllen LLP . CLAconnect.com INDEPENDENT AUDITORS' REPORT ON MINNESOTA LEGAL COMPLIANCE Honorable Mayor and Members of the City Council City of Orono Orono, Minnesota We have audited, 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, the accompanying financial statements of the governmental activities, the business type activities, each major fund, and the aggregate remaining fund information which collectively comprise the basic financial statements of City of Orono (the City), as of and for the year ended December 31, 2018, and have issued our report thereon dated August 14, 2019. The Minnesota Legal Compliance Audit Guide for Cities, promulgated by the State Auditor pursuant to Minn. Stat. § 6.65, contains seven categories of compliance to be tested: contracting and bidding, deposits and investments, conflicts of interest, public indebtedness, claims and disbursements, miscellaneous provisions, and tax increment financing. Our study included all of the listed categories. In connection with our audit, nothing came to our attention that caused us to believe that the City failed to comply with the provisions of the Minnesota Legal Compliance Audit Guide for Cities. However, our audit was not directed primarily toward obtaining knowledge of such noncompliance. Accordingly, had we performed additional procedures, other matters may have come to our attention regarding the City's noncompliance with the above -referenced provisions. The purpose of this report is solely to describe the scope of our testing of compliance relating to the provisions of the Minnesota Legal Compliance Audit Guide for Cities and the results of that testing, and not to provide an opinion on the effectiveness of the Cities compliance with those provisions. Accordingly, this communication is not suitable for any other purpose. N� �la 4 4 & ��zz� CliftonLarsonAllen LLP Minneapolis, Minnesota August 14, 2019 Clifton L arsonAllen LLP CLAconnect.com eir Management City of Orono Orono, Minnesota In planning and performing our audit of the financial statements of City of Orono (the City) as of and for the year ended December 31, 2018, in accordance with auditing standards generally accepted in the United States of America, we considered the City's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly, we do not express an opinion on the effectiveness of the City's internal control. However, during our audit, we became aware of several matters that are opportunities for strengthening internal control and operating efficiency. Our comments and suggestions regarding those matters are summarized below. A separate communication dated August 14, 2019, contains our written communication of significant deficiencies and material weaknesses in the City's internal control. This letter does not affect our communication dated August 14, 2019. Accounts Receivable Write-offs Currently it is the City's practice to allow the finance department to approve credits posted to customer accounts provided that they are small dollar amounts. City Council approval is required before any large credits can be made. However, the City has not established a dollar threshold over which would require City Council approval for account credits. We recommend that the City establish a more formal credit policy which includes a dollar limit to credits which can be initiated and approved by the accounting department. Accounting Policies and Procedures Manual In previous years it was noted that the City's accounting policies and procedures manual is over 15 years old. In the prior year we also recommended that the City review these policies and procedures to develop an updated manual as this should be revisited and updated at least every few years. As the City is still working on this we are including a recommendation again this year to review and update this manual. Information Technology In previous years audits we have recommended that the City implement an information technology disaster recovery plan. It was noted that the City began working on the development of a plan but has still not completed this. We recommend that the City work to complete this plan as soon as possible to avoid any loss of information technology and mitigate risks to the City. A member of QN. Nexia International Management City of Orono Page 2 Accounts Payable Process During the audit it was noted that the Finance Director has the ability to create a vendor, approve an invoice, and cut checks. Also noted that Utility Billing/Payroll Clerk can enter vendors and matches invoices to the checks along with sending checks as a compensating control, however this still opens up the potential for the Finance Director to have physical access, recording, and approval authority over these types of transactions. It would be possible for him to create a fake vendor, manufacture an invoice, and cut a check to that fake vendor, or to make an erroneous entry into the system and have it go unnoticed. We recommend that the City limit the Finance Director's ability either to run checks or enter vendors so he is not able to perform all of these functions. We will review the status of these comments during our next audit engagement. We have already discussed many of these comments and suggestions with various entity personnel, and we will be pleased to discuss them in further detail at your convenience, to perform any additional study of these matters, or to assist you in implementing the recommendations. This communication is intended solely for the information and use of management and others within the City, and is not intended to be, and should not be, used by anyone other than these specified parties. ZZ ->7? CliftonLarsonAllen LLP Minneapolis, Minnesota August 14, 2019 AGENDA ITEM Item No.: 13 Date: August 26, 2019 Item Description: Request For Proposals for Audit Services Presenter: Ron Olson, Agenda Finance Director Report Finance Director Section: 1. Purpose: To publish Requests for Proposals for Professional Legal Services in accordance with the RFP schedule adopted by Resolution No. 6585 adopted February 8, 2016. 2. Background: The City Council adopted a resolution to establish a schedule of 5 year reviews through the RFP process for professional services contracted by the City. Staff reviews the document annually for any scheduled RFP's. The auditor schedule was for 2017, however because of staffing issues the RFP was not performed at that time. The timeline for publication, review and selection is within Exhibit A: Request for Proposal: Professional Legal Services. 3. Staff Recommendation: City Administrator recommends approval of the Professional Auditing Services RFP and to establish an ad-hoc Professional Auditing Services RFP review committee. COUNCIL ACTION REQUESTED Motion to Approve Request for proposals for Professional Auditing Services and the appointment of an ad-hoc Professional Legal Services RFP review committee. Exhibits A. Request for Proposal: Professional Auditing Services Reference A. Resolution No. 6585 Prepared By: SIC Reviewed By: -SbV Approved By: 11V SHS City of Orono Minnesota Request for Proposals for Professional Auditing Services For the periods ending December 31, 2019 December 31, 2020 December 31, 2021 For CITY OF ORONO Ron Olson Finance Director 2750 Kelley Parkway Orono, MN 55356 952-249-4611 Rolsonkci. orono. mn.us REQUEST FOR PROPOSALS TABLE OF CONTENTS I. INTRODUCTION A. General Information B. Term of Engagement C. Subcontracting II. NATURE OF SERVICES REQUIRED A. General B. Scope of Work to be Performed C. Auditing Standards to be Followed D. Reports to be Issued E. Special Conditions F. Working Paper Retention and Access to Working Papers G. Contract Termination III. DESCRIPTION OF THE GOVERNMENT A. Principal Contact B. Background Information C. Budgetary Basis of Accounting D. Pension Plans E. Personnel Assigned F. Technology Infrastructure G. Internal Audit Function H. Availability of Prior Audit Reports and Working Papers IV. TIME REQUIREMENTS A. Proposal Calendar B. Firm Selection C. Schedule for the 2019 Fiscal Year Audit D. Entrance Conferences and Exit Conferences E. Date Final Report is Due V. ASSISTANCE TO BE PROVIDED TO THE AUDITOR AND REPORT PREPARATION A. Finance Department and Clerical Assistance B. Work Area C. Report Preparation VI. PROPOSAL REQUIREMENTS A. General Requirements B. Technical Proposal C. Dollar Cost Proposal 2 VII. EVALUATION PROCEDURES A. Review of Proposal B. Evaluation Criteria C. Oral Presentation D. Final Selection E. Right to Reject Proposals F. Disclaimer APPENDIX A — Proposer Warranties APPENDIX B — Schedule of Professional Fees and Expenses APPENDIX C — Sample Copy of Standard Agreement for Professional Services 3 I. INTRODUCTION A. General Information The City of Orono is requesting proposals from qualified certified public accounting firms to audit its financial statements for the three (3) fiscal years ending December 31, 2019, 2020 and 2021, with the option of auditing its financial statements for each of the three (3) subsequent fiscal years. These audits are to be performed in accordance with auditing standards generally accepted in the United States of America, the standards set forth for financial audits in the General Accounting Office's (GAO) GovernmentAuditing Standards, the provisions of the federal Single Audit Act of 1984 as amended in 1996 and U.S. Office of Management and Budget (OMB) Circular A-133, Audits of State and Local Governments as well as other Federal, State and local requirements in effect now or placed in effect during the engagement. Inquiries about the engagement or the request for proposal should be addressed to: Ron Olson Finance Director Rol songci.orono.mn.us 952-249-4611 In order to ensure a fair review and selection process, firms submitting proposals are specifically prohibited from contacting other staff and City Council members regarding the proposals. Any firm that does not abide by this prohibition will be presumed to have withdrawn its proposal by so doing, and will not be considered. There is no expressed or implied obligation for the City of Orono to reimburse responding firms for any expenses incurred in preparing proposals in response to this request. To be considered, qualified firms must submit electronic copies of their proposal to Ron Olson, Finance Director, via his e-mail Rolson@ci.orono.mn.us by 4:30 p.m. on October 1, 2019. The City of Orono reserves the right to reject any or all proposals submitted. The City of Orono reserves the right, where it may serve the City's best interest, to request additional information or clarification from proposers or to allow corrections of errors or omissions. At the discretion of the City, firms submitting proposals may be requested to make oral presentations as part of the evaluation process. Following a review of the proposals, a recommendation for award will be made by the Finance Director to the City Council. A final decision for award of the work will be made by majority vote of the City Council. The City of Orono reserves the right to retain all proposals submitted and to use any ideas in a proposal regardless of whether that proposal is selected. Submission of a proposal indicates acceptance by the proposing firm of the conditions contained in this request for 4 proposal, unless clearly and specifically noted in the proposal submitted and confirmed in the written contract between the City of Orono and the firm selected. It is anticipated the selection of a firm will be in November of 2019. Following the notification of the selected firm, it is expected a Letter of Engagement will be executed. B. Term of Engagement An initial three-year contract is contemplated, subject to annual review and renewal. Based on satisfactory performance, the concurrence of the Orono City Council and the annual availability of an appropriation, the City may extend the agreement annually without solicitations from other firms. In the event of unsatisfactory performance, or when in the best interest of the City, proposals may be solicited before the end of the three-year period. The City reserves the right to negotiate all terms and conditions of the contract. In the event the City and the firm are unable to agree upon all contract provisions, the City reserves the right to cease negotiations, reject the firm's proposal, and proceed to negotiate with the next selected firm. C. Subcontracting Following the award of the audit contract, no subcontracting will be allowed without the express prior written consent of the City of Orono. II. NATURE OF SERVICES REQUIRED A. General The City of Orono is soliciting the services of qualified firms of certified public accountants to audit its financial statements for the fiscal years ending December 31, 2019, 2020, and 2021. These audits are to be performed in accordance with the provisions contained in this request for proposal. B. Scope of Work to be Performed The City of Orono will retain the accounting firm to perform the following tasks: Audit the City's financial processes, records and statements in order to express an opinion on the fairness of the presentation of its government -wide, governmental major fund, business -type major fund and aggregate remaining non -major governmental and business -type fund financial statements in conformity with generally accepted accounting principles. 2. Perform the tests and procedures involving required supplementary information required by the Governmental Accounting Standards Board (GASB) as mandated by generally accepted auditing standards. 5 3. Review the presentation of the statistical section of the financial statements insofar as current generally accepted auditing standards require such review. The auditor will not be required to audit the schedule of expenditures of federal awards if such audit is not triggered by the threshold of funding received by the City for the fiscal year. C. Auditing Standards to be Followed To meet the requirements of this Request for Proposal, the auditor's work shall be performed in accordance with: • Generally accepting auditing standards as set forth by the American Institute of Certified Public Accountants (AICPA); • The standards for financial audits set forth in the U.S. General Accounting Office's (GAO) Government Auditing Standards; • The provisions of U.S. Office of Management and Budget (OMB) Circular A-133, Audits of State and Local Governments; • The provisions of the Minnesota Legal Compliance Audit Guide for Local Governments; • Any other Federal, State and local requirements in effect now or placed into effect during the engagements. D. Reports to be Issued Following the completion of the audit of the fiscal year's financial statements, the auditor shall: 1. Issue a report on the fair presentation of the financial statements in conformity with generally accepted accounting principles. 2. Issue a report on the internal control structure based on the auditor's understanding of the control structure and assessment of control risk. 3. Issue a report on compliance with applicable laws and regulations. 4. Communicate in a letter to City management any reportable conditions found during the audit. A reportable condition shall be defined as a significant deficiency in the design or operation of the internal control structure, which could adversely affect the organization's ability to record, process, summarize, and report financial data consistent with the assertions of management in the financial statements. Reportable conditions that are also material weaknesses shall be identified as such in the reports. 0 Non -reportable conditions discovered by the auditors will be reported in the separate letter to City management, which shall be referred to in the report(s) on internal controls. The audit firm will be required to make an immediate, written report of all irregularities and illegal acts or indications of illegal acts of which they become aware to the City Administrator, the Finance Director, and the Mayor of the City. 5. If applicable, issue a report on the Schedule of Expenditures of Federal Awards required by OMB Circular A-133. 6. Prepare any other requested or required reports agreed upon in the annual engagement letter. Final reporting to the City Council. Auditors will ensure that the partner in charge of the audit and/or the Audit Manager is available to attend public meetings for discussion of the final report should his/her attendance be requested by the City Council. Auditors will assure themselves that the Orono City Council is informed of each of the following: a) The auditor's responsibility under generally accepted auditing standards and government auditing standards. b) Significant accounting policies. c) Management judgments and accounting estimates. d) Significant audit adjustments. e) Other information in documents containing audited financial statements. 0 Disagreements with management. g) Management consultation with other accountants. h) Major issues discussed with management prior to retention. i) Difficulties encountered in performing the audit. j) Performance/ efficiency of the City in the fiscal year versus prior years and as compared to other government agencies. k) Assumed potential that a single audit may need to be performed and the reports that may have to be included. E. Special Conditions 1. The City of Orono may occasionally request the auditors to present information or provide routine guidance related to new GASB requirements to the City Council or City staff. F. Working Paper Retention and Access to Working Papers All working papers and reports must be retained, at the auditor's expense, for a minimum of six (6) years following the issuance of an opinion, unless the firm is notified in writing by the 7 City of Orono of the need to extend the retention period. The auditor will be required to make working papers available, upon request, to the following parties or their designees: 1. City of Orono 2. Office of the State Auditor 3. U.S. General Accounting Office (GAO) 4. Parties designated by the federal or state governments or by the City of Orono as part of an audit quality review process 5. Auditors of entities of which the City of Orono is a sub -recipient of grant funds In addition, the firm shall respond to the reasonable inquiries of successor auditors and allow successor auditors to review working papers relating to matters of continuing accounting significance. G. Contract Termination Either party may cancel the contract for an audit year by giving notice in writing to the other party at least ninety (90) days prior to January first of the audit year. A. Principal Contact The auditor's principal contact with the City of Orono will be the Finance Director, Ron Olson, who will coordinate the assistance to be provided by the City to the auditor. B. City Background Information The City of Orono is located in Hennepin County approximately 15 miles west of downtown Minneapolis on the North Shore of Lake Minnetonka. The City encompasses a total area of approximately 25 square miles, with 16 square miles of land and 9 square miles of lake. The Metropolitan Council has estimated the City of Orono to have population of 8,102. Moody's Investors Service has assigned an AAA rating for the City's general obligation bond rating. Copies of the most recent Comprehensive Annual Financial Report are available on the website http://www.ci.orono.mn.us or upon request. The City has approximately 61 full time equivalent employees. City enterprise funds include water utility, sewer utility, storm water utility, recycling program and cable franchise. The City of Orono's fiscal year begins on January Pt and ends on December 31St The City's governing body consists of a Mayor and four Council members, all elected at large. Council members serve overlapping terms of office. The present Mayor and Council members and their respective terms are: 9 Denny Walsh Victoria Seals Richard Crosby II Aaron Printup Matt Johnson Mayor Council Member Council Member Council Member Council Member December 31, 2020 December 31, 2020 December 31, 2020 December 31, 2022 December 31, 2022 Dustin Rief, the City Administrator, has been with the City since August 2017. He is responsible for the daily management of city business and the administration of policy as directed by the Council. Ron Olson, the Finance Director, has been with the City since October 1997. C. Budgetary Basis of Accounting The City of Orono prepares its budgets on a basis consistent with generally accepted accounting principles. D. Pension Plans All full-time and certain part-time employees of the City are covered by defined benefit pension plans administered by the Public Employees Retirement Association of Minnesota (PERA). The association administers the Public Employees Retirement Fund and the Public Employees Police and Fire Fund, which are cost sharing multiple employer retirement plans. A disclosure of the plan is located in the City's Comprehensive Annual Financial Report (CAFR) Notes to Basic Financial Statements section. E. Personnel Assigned The City's Finance Department is headed by the Finance Director and consists of one Accountant and one Payroll/Utility Billing Clerk. Typical functions include accounts payable, accounts receivable, cash management, utility billing, debt management and financial reporting. F. Technology Infrastructure The City's accounting system (Caselle Clarity) consists of the General Ledger, Payroll, Accounts Payable, Accounts Receivable, Cash Receipts, and Utility Billing. The system is fully automated. The City of Orono is a member of LOGIS, a computer consortium of 52 member organizations that share hardware and software operations. 9 IV. G. Internal Audit Function The City of Orono does not maintain an independent internal audit function other than internal checks performed by the Finance Department. H. Availability of Prior Audit Reports and Working Papers Interested proposers who wish to review prior years' audit reports and management letters should contact: Ron Olson, Finance Director 2570 Kelley Parkway Orono, Minnesota 55356 Rolson@ci. orono. mn. us 952-249-4611 The City of Orono will make its best efforts to make prior audit reports and supporting working papers available to proposers if requested. TIME REQUIREMENTS A. Proposal Calendar Request for proposal issued Due date for notification of interest Last date for submission of questions Responses to questions distributed Due date for proposals Possibility of interviews B. Firm Selection Selected firm notified C. Schedule for the 2019 Fiscal Year Audit August 26, 2019 September 16, 2019 September 16 2019 September 23, 2019 October 1, 2019, 4:30 pm October 21-23, 2019 November 1, 2019 1. Detailed Audit Plan: The auditor will provide the City of Orono both a detailed audit plan and a list of all schedules to be prepared by the City of Orono no later than December 31, 2019. 2. Fieldwork: The auditor will complete all fieldwork by April 30, 2020. A schedule for interim work, fieldwork and draft reports will be determined upon completion of this selection process. A similar time schedule will be developed for audits of future fiscal years. 10 D. Entrance Conferences and Exit Conferences At a minimum, the following conferences should be held by the dates indicated on the schedule. These dates may be changed by mutual, written agreement between the City of Orono and the selected auditor. Week of January 6, 2020: Entrance conference with Finance Director. The purpose of this meeting will be to discuss any potential audit problems and the interim work to be performed. This meeting will also be used to establish overall liaison for the audit and to make arrangements for work space and other needs of the auditor. Discussions of a preliminary audit could be discussed at this time. No Later than the Week of May26 2020: Exit conference with City Administrator and Finance Director. The purpose of this meeting will be to summarize the results of the field work and to review results and findings. A similar meeting schedule will be developed for audits of future fiscal years. E. Date Final Report is Due The Finance Director will complete a review of the draft report as expeditiously as possible. It is not expected that this process should exceed one (1) week. During that review period, the auditor should be available for any meetings that may be necessary to discuss the audit reports. Once all issues for discussion are resolved, the final signed report shall be delivered to the City by June 1, 2020. The audit and final report presentation to the City Council will be scheduled for the second Monday in June of 2020. A similar reporting schedule will be developed for audits of future fiscal years. V. ASSISTANCE TO BE PROVIDED TO THE AUDITOR AND REPORT PREPARATION A. Finance Division and Clerical Assistance The finance division staff and responsible management personnel will be available during the audit to assist the firm by providing information, documentation and explanations. The preparation of any confirmations desired by the auditor will be the responsibility of the City of Orono using the format provided by the auditor. B. Work Area The City of Orono will provide the auditor with reasonable workspace, table and chairs. The auditor will also be provided with access to the internet, a telephone, photocopying facilities. 11 C. Report Preparation City's Comprehensive Annual Financial Report: Report preparation, editing, printing and binding shall be the responsibility of the audit firm. The City completes the Introductory, MD&A, and Statistical sections of the CAFR. The city shall do report editing and proofing. All Other Reports: Report preparation, editing, printing and binding shall be the responsibility of the audit firm. Report preparation, editing, printing and binding shall be the responsibility of the audit firm. I ►t�11�7.`1-\ A ►j Orel 111►j 01aI a►YlF.V A. General Requirements Responses to this Request should include the following information in the order prescribed below. Submissions must be received by 4:30 p.m. on Tuesday, October 1, 2019 for a proposal/response to be considered by the City: 1. Title Page: Title page showing the request for proposal subject; the firm's name; the name, address and telephone number of the contact person; and the date of the proposal. 2. Table of Contents 3. Transmittal Letter: A signed letter of transmittal which briefly states the proposers' understanding of the work to be done, the commitment to perform the work within the time period, a statement why the firm believes itself to be best qualified to perform the engagement and an acknowledgement that the proposal is a firm and irrevocable offer for the three year period. 4. Technical Proposal: The Technical Proposal should follow the order set forth in Section VI — B below. S. An executed copy of the Proposer Warranties attached to this Request for Proposal (Appendix A). 6. Dollar Cost Proposal: The Dollar Cost Proposal should follow the order set forth in Section VI — C below (Appendix B). 7. Professional Services Agreement: An executed copy will be required only from the selected firm. During the bidding process, firms should reference the sample Professional Services Agreement (Appendix C) to ensure their ability to meet all of the requirements outlined in the agreement. 12 Proposers should send electronic copies to the following address: Ron Olson Finance Director City of Orono Rolson ,ci.orono.mn.us Please mark the Subject line of the e-mail as "Audit RFP". B. Technical Proposal General Requirements: The purpose of the Technical Proposal is to demonstrate the qualifications, competence and capacity of the firms seeking to undertake an independent audit of the City of Orono in conformity with the requirements of this request for proposal. The Technical Proposal should demonstrate the qualifications of the firm and of the particular staff to be assigned to this engagement. It should also specify an audit approach that will meet the request for proposal requirements. The Technical Proposal should address all the points outlined in the request for proposal (excluding any cost information, which should only be included in the dollar cost proposal). The Technical Proposal should be prepared simply and economically, providing a straightforward, concise description of the proposer's capabilities to satisfy the requirements of the request for proposal. While additional data may be presented, the following items must be included. They represent the primary criteria against which the proposal will be evaluated: 1. Independence: The firm should provide an affirmative statement that it is independent of the City of Orono as defined by generally accepted auditing standards. The firm also should provide an affirmative statement that it is independent of all of the City's agencies and component units. The firm should also list and describe the firm's professional relationships involving the City or any of its agencies or component units for the past five (5) years, together with a statement explaining why such relationships do not constitute a conflict of interest relative to performing the proposed audit. In addition, the firm shall give the City written notice of any relevant professional relationships entered into during the period of this agreement. 2. License to Practice in Minnesota: An affirmative statement should be included that the firm and all assigned key professional staff are properly licensed to practice in Minnesota. 13 3. Firm Qualifications and Experience: The proposer should state the size of the firm, the size of the firm's governmental audit staff, the location of the office or offices from which the work on this engagement is to be performed, the number and nature of the professional staff to be employed in this engagement on a full-time basis and the number and nature of the staff to be so employed on a part-time basis. The firm is also required to submit a copy of the report on its most recent external quality control review, with a statement whether that quality control review included a review of specific city engagements. The firm shall also provide information on the results of any federal or state desk review of field reviews of its audits during the past three (3) years. In addition, the firm shall provide information on the circumstances and status of any disciplinary action taken or pending against the firm during the past three (3) years with state regulatory bodies or professional organizations. The firm shall include the number of clients it has assisted in implementing, and that have received awards in, the GFOA certificate program. 4. Partner, Supervisory and Staff Qualifications and Experience: Identify the principal supervisory and management staff, including engagement partner, managers, other supervisors and specialists, who would be assigned to the engagement. Indicate whether each such person is licensed to practice as a certified public accountant in Minnesota. Provide information on the government auditing experience of each person. Provide information regarding the number, qualifications, experience and training, including relevant continuing professional education, of the specific staff to be assigned to this engagement. Indicate how the quality of the staff, over the term of the engagement, will be assured. Engagement partners, managers, other supervisory staff and firm specialists mentioned in the response to this request for proposal may be changed if those personnel leave the firm, are promoted or are assigned to another office. These personnel may also be changed for other reasons with the express prior written permission of the City. However, in either case, the City retains the right to approve or reject replacements. Other audit personnel may be changed at the discretion of the proposer provided that replacements have substantially the same or better qualifications or experience. 5. Prior Engagements with the City of Orono: List separately by type of engagement (i.e., audit, management advisory services, other) all engagements within the last five years for the City of Orono, ranked on the basis of total staff hours. Indicate the scope of work, date, engagement partners, total hours, the location of the firm's office 14 from which the engagement was performed and the name and telephone number of the principal client contact. 6. Similar Engagements with Other Government Entities: For the firm's office that will be assigned responsibility for the audit, list the most significant engagements (minimum — 3, maximum - 5) performed in the last three (3) years that are similar to the engagement described in this request for proposal. These engagements should be ranked on the basis of total staff hours. Indicate the scope of work, date, engagement partners, total hours and the name and telephone number of the principal client contact. For engagements for cities, indicate whether the Comprehensive Annual Financial Report prepared for each city received the GFOA Certificate of Excellence in Financial Reporting for the most recent audit. 7. Specific Audit Approach: The proposal should set forth a work plan, including an explanation of the audit methodology to be followed to perform the services required in Section II of this request for proposal. In developing the work plan, reference should be made to such sources of information as the City of Orono's budget and related materials, Capital Improvements Program, organizational charts, manuals and programs, and financial and other management information systems. Proposers will be required to provide the following information on their audit approach: a) Proposed segmentation of the engagement b) Level of staff and number of hours to be assigned to each proposed segment of the engagement c) Sample size and the extent to which statistical sampling is to be used in the engagement d) Extent of use of EDP software in the engagement e) Type and extent of analytical procedures to be used in the engagement f) Approach to be taken to gain and document an understanding of the City's internal control structure g) Approach to be taken in determining laws and regulations that will be subject to audit test work h) Approach to be taken in drawing audit samples for purposes of tests of compliance 8. Identification of Anticipated Potential Audit Problems: The proposal should identify and describe any anticipated potential audit problems, the firm's approach to resolving these problems and any special assistance that will be requested from the City of Orono. 9. Report Format: The proposal should include sample formats for required reports. 15 C. Dollar Cost Proposal Total All -Inclusive Maximum Price: The dollar cost proposed should contain all pricing information relative to performing the audit engagement as described in this request for proposal. The total all-inclusive maximum price to be bid is to contain all direct and indirect costs including all out-of-pocket expenses. The City of Orono will not be responsible for expenses incurred in preparing and submitting the technical proposal or the dollar cost bid. Such costs should not be included in the proposal. The following information should be included in the Dollar Cost Proposal: a) Name of Firm b) Certification that the person signing the proposal is empowered to submit the proposal, and authorized to sign a contract with the City of Orono if the firm is selected c) A total all-inclusive maximum price for the 2019, 2020 and 2021 engagements d) Rates by Partner, Specialist, Supervisory and Staff Level and hours anticipated for each I e) A schedule of professional fees and expenses, presented in the format provided in the attached Appendix B, which supports the total all-inclusive maximum price for each year. The cost of special services should be disclosed as separate components of the total all- inclusive maximum price f) Out-of-pocket expenses included in the total all-inclusive maximum price and reimbursement rates: All reimbursable expenses by category as included in the total all-inclusive maximum price submitted by the firm g) Manner of Payment: The City expects that payments will be made on the basis of hours of work completed during the course of the engagement and out-of-pocket expenses incurred in accordance with the firm's dollar cost proposal. Interim billing shall cover a period of not less than a calendar month. Payment of the final billing will be held by the City pending the delivery of the firm's final reports. VII. EVALUATION PROCEDURES A. Review of Proposal The City of Orono reserves the right to retain all proposals submitted and use any idea in a proposal regardless of whether that proposal is selected. If it should become necessary for the City of Orono to request the firm selected to render any additional services to either supplement the services requested in this RFP or to perform additional work as a result of the specific recommendations included in any report issued under the engagement, then such additional work will be performed only if set forth in an addendum to the contract between City of Orono and the firm. Any such additional work agreed to between City of Orono and the firm will be performed at the same rates set forth in the schedule of fees and expenses included in the dollar cost bid. 16 B. Evaluation Criteria Proposals will be evaluated using three sets of criteria. Firms meeting the mandatory criteria will have their proposals evaluated for both technical qualifications and price. The selection process will include, but not be limited to, the following criteria: 1. Mandatory Elements a) The audit firm is independent and licensed to practice in Minnesota. b) The firm has no conflict of interest with regard to any other work performed by the firm for the City. c) The firm adheres to the instructions in this request for proposal for preparing and submitting the proposal. d) The firm submits a copy of its last external quality control review report and the firm has a record of quality audit work. 2. Technical Quality a) Expertise and Experience 1) The firm's past experience and performance on comparable government engagements. 2) The quality of the firm's professional personnel to be assigned to the engagement and the quality of the firm's management support personnel to be available for technical consultation. 3) The firm's expertise with the GFOA Certificate of Excellence in Financial Reporting. b) Audit Approach 1) Adequacy of proposed staffing plan for various segments of the engagement. 2) Adequacy of sampling techniques. 3) Adequacy of analytical procedures. 3. Price a) Cost will be a factor in the selection of an audit firm. However, price will not be the sole or dominating factor in the selection process. C. Oral Presentation During the evaluation process, the City may, at its discretion, request any one or all firms submitting proposals to make oral presentations. Such presentation will provide firms with an opportunity to answer any questions the City may have on a firm's proposal. Not all firms may be asked to make such oral presentations. 17 D. Final Selection Staff will recommend to the City Council the appointment of an independent CPA firm judged to be in the best interests of the City for the auditing services required. The final decision with respect to the appointment will be made by the City Council. E. Right to Reject Proposals Submission of a proposal indicates acceptance by the firm of the conditions contained in this request for proposal unless clearly and specifically noted in the proposal submitted and confirmed in the contract between the City of Orono and the firm selected. The City of Orono reserves the right to reject any or all proposals. F. Disclaimer There is no expressed or implied obligation for the City of Orono to reimburse responding firms for any expenses incurred in preparing proposals in response to this request. 18 APPENDIX A CITY OF ORONO PROPOSER WARRANTIES A. Proposer warrants that it is willing and able to comply with State of Minnesota laws with respect to foreign (non -state of Minnesota) corporations. B. Proposer warrants that it is willing and able to obtain an errors and omissions insurance policy providing a prudent amount of coverage for the willful or negligent acts or omissions of any officers, employees or agents thereof. C. Proposer warrants that it will not delegate or subcontract its responsibilities under an agreement without the prior written permission of the City of Orono and the Firefighters' Relief Association. D. Proposer warrants that all information provided in connection with this proposal is true and accurate. E. Proposer certifies that it can and will provide and make available, at a minimum, all services set forth in Section II of the City's request for proposals, "Services Requested." Signature of Official: Name (typed): Title: Firm: Date: 19 APPENDIX B-1 CITY OF ORONO SCHEDULE OF PROFESSIONAL FEES AND EXPENSES ALL INCLUSIVE AUDIT COSTS 20 Total All Inclusive Year Cost — City Audit 2019 $ 2020 $ 2021 $ Total $ 20 APPENDIX B-2 SCHEDULE OF PROFESSIONAL FEES AND EXPENSES FOR THE AUDIT OF THE DECEMBER 31, 2019 FINANCIAL STATEMENTS FOR THE CITY OF ORONO NOTE: The rate quoted should not be presented as a general percentage of the standard hourly rate or as a gross deduction from the total all-inclusive maximum price. 21 Standard Quoted Hourly Hourly Hours Rates Rates Total Partners Managers Supervisory Staff $ $ $ Other (Specify) $ $ $ Subtotal $ $ $ Out -of -Pocket Expenses $ Meals and Lodging $ Transportation $ Other (Specify) $ Total All- inclusive Price for 2019 Audit Services $ 21 APPENDIX B-3 SCHEDULE OF PROFESSIONAL FEES AND EXPENSES FOR THE AUDIT OF THE DECEMBER 31, 2020 FINANCIAL STATEMENTS FOR THE CITY OF ORONO NOTE: The rate quoted should not be presented as a general percentage of the standard hourly rate or as a gross deduction from the total all-inclusive maximum price. 22 Standard Quoted Hourly Hourly Hours Rates Rates Total Partners Managers Supervisory Staff $ $ $ Other (Specify) $ $ $ Subtotal $ $ $ Out -of -Pocket Expenses $ Meals and Lodging $ Transportation $ Other (Specify) $ Total All- inclusive Price for 2020 Audit Services $ 22 APPENDIX B-4 SCHEDULE OF PROFESSIONAL FEES AND EXPENSES FOR THE AUDIT OF THE DECEMBER 31, 2021 FINANCIAL STATEMENTS FOR THE CITY OF ORONO NOTE: The rate quoted should not be presented as a general percentage of the standard hourly rate or as a gross deduction from the total all-inclusive maximum price. 23 Standard Quoted Hourly Hourly Hours Rates Rates Total Partners Managers Supervisory Staff $ $ $ Other (Specify) $ $ $ Subtotal $ $ $ Out -of -Pocket Expenses $ Meals and Lodging $ Transportation $ Other (Specify) $ Total All- inclusive Price for 2021 Audit Services $ 23 ATTACHMENT C SAMPLE COPY OF STANDARD AGREEMENT FOR PROFESSIONAL SERVICES PROFESSIONAL SERVICES AGREEMENT AGREEMENT made this day of between the CITY OF ORONO, a Minnesota , 2019, by and municipal corporation ("City") and ("Consultant"). IN CONSIDERATION OF THEIR MUTUAL COVENANTS THE PARTIES AGREE AS FOLLOWS: 1. SCOPE OF SERVICES. The City retains Consultant to furnish the services set forth in the Contract Documents. The Consultant agrees to perform the services. 2. CONTRACT DOCUMENTS. The following documents shall be referred to as the "Contract Documents," all of which shall be taken together as a whole as the contract between the parties as if they were set verbatim and in full herein: A. This Professional Services Agreement. B. Consultant's proposal dated re: City of Orono Professional Auditing Services. C. Insurance certificate. In the event of conflict among the provisions of the Contract Documents, the order in which they are listed above shall control in resolving any such conflicts with Contract Document "A" has the first priority and Contract Document "C" having the last priority. 3. COMPENSATION. Consultant shall be paid by the City for the services described in Contract Documents on an hourly basis but not to exceed $ , inclusive of reimbursables, taxes and other charges. The not to exceed fee shall not be adjusted if the estimated hours to perform a task, the number of estimated required meetings or any other estimate or assumption is exceeded. Consultant shall request payment for services rendered on a monthly basis. The monthly payment applications from Consultant shall identify work completed. 4. CHANGE ORDERS. All change orders, regardless of amount, must be approved in advance and in writing by the City. No payment will be due or made for work done in advance of such approval. 5. DOCUMENTS. The City shall be the owner of all documents, reports, studies, analysis and the like prepared by the Consultant in conjunction with this contract. 24 6. STANDARD OF CARE. Consultant shall exercise the same degree of care, skill, and diligence in the performance of the services as is ordinarily possessed and exercised by members of the profession under similar circumstances in Pakota Hennepin County, Minnesota. Consultant shall be liable to the fullest extent permitted under applicable law, without limitation, for any injuries, loss or damages proximately caused by Consultant's breach of this standard of care. City shall not be responsible for discovering deficiencies in the accuracy of Consultant's services. Consultant shall be responsible for the accuracy of the work and shall promptly make necessary revisions or corrections resulting from errors and omissions on the part of Consultant without additional compensation. 7. COMPLIANCE WITH LAWS AND REGULATIONS. In providing services hereunder, Consultant shall abide by all statutes, ordinances, rules and regulations pertaining to the provisions of services to be provided. 8. INDEMNIFICATION. The Consultant shall indemnify and hold harmless the City, its officers, agents, and employees, of and from any and all claims, demands, actions, causes of action, including costs and attorney's fees, arising out of or by reason of the execution or performance of the work or services provided for herein to the comparative extent they are caused by Consultant's negligent acts or omissions or those negligent acts or omissions of persons for whom Consultant is legally responsible. 9. COPYRIGHT. Consultant shall defend actions or claims charging infringement of any copyright or patent by reason of the use or adoption of any designs, drawings or specifications supplied by them, and they shall hold harmless the City from loss or damage resulting therefrom. 10. INSURANCE. Consultant shall secure and maintain such insurance as will protect Consultant from claims under the Worker's Compensation Acts, automobile liability, and from claims for bodily injury, death, or property damage which may arise from the performance of services under this Agreement. Such insurance shall be written for amounts not less than: Commercial General Liability (or in combination with an umbrella policy) $2,000,000 Each Occurrence $2,000,000 Products/ Completed Operations Aggregate $2,000,000 Annual Aggregate The following coverages shall be included: Premises and Operations Bodily Injury and Property Damage Personal and Advertising Injury Blanket Contractual Liability Products and Completed Operations Liability 25 Automobile Liability $2,000,000 Combined Single Limit — Bodily Injury & Property Damage Including Owned, Hired & Non -Owned Automobiles Workers Compensation Workers' Compensation insurance in accordance with the statutory requirements of the State of Minnesota, including Employer's Liability with minimum limits is as follows: • $500,000 — Bodily Injury by Disease per employee • $500,000 —Bodily Injury by Disease aggregate • $500,000 —Bodily Injury by Accident The City shall be named as an additional insured on the general liability and umbrella policies on a primary and non-contributory basis. The Consultant shall secure and maintain a professional liability insurance policy. Said policy shall insure payment of damages for legal liability arising out of the performance of professional services for the City, in the insureds capacity as Consultant, if such legal liability is caused by a negligent act, error or omission of the insured or any person or organization for which the insured is legally liable. The policy shall provide minimum limits of $2,000,000 with a deductible maximum of $25,000 unless the City agrees to a higher deductible. Before commencing work, the Consultant shall provide the City a certificate of insurance evidencing the required insurance coverage in a form acceptable to City. 11. INDEPENDENT CONTRACTOR. The City hereby retains the Consultant as an independent contractor upon the terms and conditions set forth in this Agreement. The Consultant is not an employee of the City and is free to contract with other entities as provided herein. Consultant shall be responsible for selecting the means and methods of performing the work. Consultant shall furnish any and all supplies, equipment, and incidentals necessary for Consultant's performance under this Agreement. City and Consultant agree that Consultant shall not at any time or in any manner represent that Consultant or any of Consultant's agents or employees are in any manner agents or employees of the City. Consultant shall be exclusively responsible under this Agreement for Consultant's own FICA payments, workers compensation payments, unemployment compensation payments, withholding amounts, and/or self- employment taxes if any such payments, amounts, or taxes are required to be paid by law or regulation. 12. SUBCONTRACTORS. Consultant shall not enter into subcontracts for services provided under this Agreement without the express written consent of the City. Consultant shall comply with Minnesota Statute § 471.425. Consultant must pay subcontractor for all undisputed services provided by Subcontractor within ten days of Consultant's receipt of payment from City. Consultant must pay interest of 1.5 percent per month or any part of a month to subcontractor on any undisputed amount not paid on time to subcontractor. The minimum monthly interest penalty payment for an unpaid balance of $100 or more is $10. 26 13. ASSIGNMENT. Neither party shall assign this Agreement, or any interest arising herein, without the written consent of the other party. 14. WAIVER. Any waiver by either parry of a breach of any provisions of this Agreement shall not affect, in any respect, the validity of the remainder of this Agreement. 15. ENTIRE AGREEMENT. The entire agreement of the parties is contained herein. This Agreement supersedes all oral agreements and negotiations between the parties relating to the subject matter hereof as well as any previous agreements presently in effect between the parties relating to the subject matter hereof. Any alterations, amendments, deletions, or waivers of the provisions of this Agreement shall be valid only when expressed in writing and duly signed by the parties, unless otherwise provided herein. 16. CONTROLLING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Minnesota. 17. RECORDS. The Consultant shall maintain complete and accurate records of time and expense involved in the performance of services. 18. AUDIT DISCLOSURE AND DATA PRACTICES. Any reports, information, data, etc. given to, or prepared or assembled by the Consultant under this Agreement which the City requests to be kept confidential, shall not be made available to any individual or organization without the City's prior written approval. The books, records, documents and accounting procedures and practices of the Consultant or other parties relevant to this Agreement are subject to examination by the City and either the Legislative Auditor or the State Auditor for a period of six (6) years after the effective date of this Agreement. This Agreement is subject to the Minnesota Government Data Practice Act, Minnesota Statutes Chapter 13 (Data Practices Act). All government data, as defined in the Data Practices Act Section 13.02, Subd. 7, which is created, collected, received, stored, used, maintained, or disseminated by Consultant in performing any of the functions of the City during performance of this Agreement is subject to the requirements of the Data Practice Act and Consultant shall comply with those requirements as if it were a government entity. All subcontracts entered into by Consultant in relation to this Agreement shall contain similar Data Practices Act compliance language. CITY OF ORONO Mv Denny Walsh, Mayor Its AND AND Dustin Rief, City Administrator Its 27 AGENDA ITEM Item No.: 14 Date: August 26, 2018 Item Description: Fire Department Door Access Improvement Request Presenter: Dustin Rief, Agenda City Administrator City Administrator Section: Report 1. Purpose: To discuss the direction on a proposed property purchase or easement access on Parcel ID 3411823320002, located adjacent to the North edge of Fire Station 1 located at 340 Willow Dr. 2. Background: On July 22° 2019 Tony Sarenpa approached the council during public comment about proposing to the City the possibility of purchasing the parcel. The council directed the City Administrator to reach out and have a discussion regarding the proposal and to bring it back to council. The City Administrator met with Mr. Sarenpa to discuss the proposal. The two options proposed are below: a. Purchase property. Currently, Priced at $200,000 b. Provide easement to allow access to Willow Drive 3. Staff Recommendation: City Administrator recommends providing easement through city property to access the parcel. Staff is asking for direction on the request and will initiate discussion based on council guidance COUNCIL ACTION REQUESTED Option A: Motion to authorize staff to negotiate purchase Option B: Motion to authorize staff to negotiate easement Option C: Take no action on proposal Exhibits A. Parcel Information and Map Prepared By: -SbV Reviewed By: -SbV Approved By: -Sb Hennepin County Property Map Date: 8/21/2019 PARCEL ID: 3411823320002 OWNER NAME: Miller Living Trust PARCEL ADDRESS: 38 Address Unassigned, Orono MN 00000 PARCEL AREA: 1.71 acres, 74,532 sq ft A -T -B: Abstract SALE PRICE: SALE DATA: SALE CODE: ASSESSED 2018, PAYABLE 2019 PROPERTY TYPE: Vacant Land -Residential HOMESTEAD: Non -Homestead MARKET VALUE: $125,000 TAX TOTAL: $1,720.10 ASSESSED 2019, PAYABLE 2020 PROPERTY TYPE: Vacant Land -residential HOMESTEAD: Non -homestead MARKET VALUE: $125,000 Comments: This data (i) is furnished 'AS IS' with no representation as to completeness or accuracy; (ii) is furnished with no warranty of any kind; and (iii) is notsuitable for legal, engineering or surveying purposes. Hennepin County shall not be liable for any damage, injury or loss resulting from this data. COPYRIGHT © HENNEPIN COUNTY 2019