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Home My WebLink About01-22-2024 CC Agenda PacketAgenda City Council Meeting Monday, January 22, 2024, 6:00 PM City Council Chambers | 2780 Kelley Parkway, Orono, MN 55356 952-249-4600 /https://www.oronomn.gov/ 1. City Council Minutes of January 8, 2024 2. Claims/Bills 3. Approval of Rental Licenses 4. Authorization to enter into a contracts with Vector Solutions, First Due and First Arriving 5. Authorization to Hire Stephen Thomas - Police Officer 6. Golf Course Clubhouse Manager Part-time Status Change 7. Approval to promote and hire Fleet Supervisor 8. 2022 Annual Comprehensive Financial Report Presentation 9. Authorization to hire a part-time firefighter 10. Approve Next Work Session Draft Agenda 11. Orono Fire facility in Navarre (23-044) Draft Design Review 12. Council Committee Reports - Communication Committee 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 Presentations Community Development Report Finance Report Parks Report Public Works Report Public Safety Report Attorney Report City Administrator/Engineer Report Council Committee Reports Public Comments - (Limit 3 Minutes per Person) This is an opportunity for the public to address the City Council. The council will not engage in Sign up for email notifications at https://www.oronomn.gov/ 1 13. Closed session to discuss Orono and Long Lake litigation 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. Mayor/Council Report Closed Session Adjournment Upcoming Events 02/06 Park Commission Work Session 6pm 02/12 City Council Work Session 5pm 02/12 City Council Meeting 6pm 02/14 Coffee with the Mayor 9am 02/19 Closed - Official Holiday 02/20 Planning Commission Meeting 6pm Sign up for email notifications at https://www.oronomn.gov/ 2 Item No.: 1 Date: January 22, 2024 Presenter: Christine Lusian Presenter: City Clerk Section:Consent Agenda Title: City Council Minutes of January 8, 2024 1.Purpose: Approve the City Council Minutes of January 8, 2024. 2.Staff Recommendation: Adopt the January 8th, 2024 City Council regular meeting and work session minutes AGENDA ITEM COUNCIL ACTION REQUESTED Approve the City Council Work Session and Regular Meeting Minutes of January 8, 2024. Exhibits A. 01-08-2024 CC Minutes B. 01-08-2024 CC Minutes - work session 3 Minutes Orono City Council Regular Meeting Orono City Council Chambers January 8, 2024 _____________________________________________________________________________________ Mayor Walsh called the meeting to order at 6:00 p.m., followed by the Pledge of Allegiance. ROLL CALL Orono City Council members present: Mayor Dennis Walsh, City Council Members Matt Johnson, Alisa Benson, Richard Crosby III, and Maria Veach. Staff present were City Attorney Soren Mattick, City Administrator/Engineer Adam Edwards, Fire Chief James Van Eyll and Community Development Director Laura Oakden. PLEDGE OF ALLEGIANCE APPROVAL OF AGENDA CONSENT AGENDA 1.City Council Meeting Minutes December 11, 2023 2.Annual Appointments – Resolution 7444 3.Claims/Bills 4.Approval of Licenses 5.Approval to Accept Donation – Katherine Arborgast 6.#LA23-000045, Ellette Anderson & James and Melissa Easley, Vacation of ROW between 1250 and 1260 Spruce Place - Resolution No. 7445 / Encroachment Agreements 7.Truck Replacement with Related Components 8.Lurton Park Parking Lot Expansion Design (24-026) 9.2024 Sanitary Sewer Rehabilitation (CIPP) Design (24-014) 10.Tonkawa Forcemain Change Order #3 (22-021) 11.ArcGIS Online Upgrade Proposal (24-014) Crosby moved, Johnson seconded, to approve the Agenda and Consent Agenda as submitted. VOTE: Ayes 5, Nays 0. PRESENTATIONS 12.Presentation by Bolton and Menk, Consulting Engineers David Martini of the City’s consulting engineers, Bolton and Menk, gave a presentation on the firm’s history with the City and reviewed 2023 projects. PUBLIC WORKS REPORT None COMMUNITY DEVELOPMENT REPORT Community Development Director Laura Oakden gave a report on building permit revenue indicating the 2023 revenue had exceeded budget by nearly $300,000. PUBLIC SAFETY REPORT 4 Minutes Orono City Council Regular Meeting Orono City Council Chambers January 8, 2024 _____________________________________________________________________________________ Page 2 of 3 13.Authorization to Hire Paid-on-Call Fire Fighter The City Council is requested to authorize the hiring of a Paid-on-Call Fire Fighter for Station 2 coverage. Crosby moved, Veach seconded, to approve a conditional job off to Chris Adams as a Paid-on-Call fire fighter at a rate $16 per hour starting January 9, 2024. VOTE: Ayes 4, Nays 1 (Benson). 14.Authorization to Hire Part-Time Fire Fighters The City Council is requested to authorize the hiring of Part-Time Fire Fighters for week-day daytime duty crews at Station 2. Johnson moved, Crosby seconded, to approve conditional job offers to John Jackson, Jason Huber and Tom Flermoen as part-time fire fighters at a rate of $20 per hour starting January 9, 2024. VOTE: Ayes 4, Nays 1 (Benson). CITY ATTORNEY REPORT City Attorney Soren Mattick updated the Council on the outcome of two lawsuits against the City that were dismissed in the last week. COUNCIL/COMMITTEE REPORTS 15.HR/Org Committee Benson updated the Council on the recent HR Committee meeting discussions related to staffing in several departments. PUBLIC COMMENTS Fergus Weir, 710 Gander Road; Debra Cornick, 4305 Chippewa Lane; Penny Saiki, 2874 Casco Point Road; Krista Berbig, Long Lake; Kelly Grady, 271 Greenhill Lane, Long Lake; and Brad Erickson, 21150 Horseshoe Trail, Corcoran provided comments. MAYOR/COUNCIL REPORT Mayor and Council provided reports. ADJOURNMENT Walsh moved, Crosby seconded, to adjourn the meeting at 7:07 p.m. to Monday, January 22, 2024 at 6:00 p.m. VOTE: Ayes 5, Nays 0. ATTEST: ____________________________________________________________________________ Christine Lusian, City Clerk Dennis Walsh, Mayor 5 Minutes Orono City Council Regular Meeting Orono City Council Chambers January 8, 2024 _____________________________________________________________________________________ Page 3 of 3 Minutes approved by Orono City Council January 22, 2024. Meeting videos and transcripts available at oronomn.gov. 6 Minutes City Council Work Session Monday, January 8, 2024, 5:00 PM City Council Chambers | 2780 Kelley Parkway, Orono, MN 55356 ROLL CALL City Council members present: Mayor Dennis Walsh, City Council Members Matt Johnson, Alisa Benson, Richard Crosby III, and Maria Veach. Staff present: City Administrator/Engineer Adam Edwards, Fire Chief James Van Eyll, Community Development Director Laura Oakden, and City Clerk Christine Lusian. ANNUAL APPOINTMENTS 2024 City Administrator/Engineer Edwards provided an introduction on annual appointments and explained related requirements and updates. City Council members participated in discussion on the topic. Members discussed the value of council-appointed advisory committees in providing insight and information on specific topics for council to make well-informed decisions. Members also discussed expecations of professional conduct by all appointed officials while acting in capacity of the city. ADJOURNMENT Work session ended at 5:40 p.m. ATTEST: ________________________________________________________________________ Christine Lusian, City Clerk Dennis Walsh, Mayor 7 Item No.: 2 Date: January 22, 2024 Presenter: Maggie Jin Presenter: Finance Director Section:Consent Agenda Title: Claims/Bills 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 122691 to 122765 and ACH transactions 20130431 to 20130434 totaling $1,105,415.65 3.Staff Recommendation: Staff recommends approval of a motion authorizing payment to the claims listed as presented. AGENDA ITEM COUNCIL ACTION REQUESTED Motion to approve the claims list as presented Exhibits Check Register 2024-01-22 8 City of Orono Check Register - COUNCIL REPORT Page: 1 Check Issue Dates: 1/9/2024 - 1/22/2024 Jan 18, 2024 11:52AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount MORRIE'S AUTO GROUP 01/09/2024 122688 2023 FORD 405-48500-550 CAPITAL TRUCK PURCHASE REPLACEMENT 71 72,737.00 Total 122688:72,737.00 AT&T MOBILTY 01/12/2024 122689 2873263270 101-41900-321 MOBILE SERVICE/AT&T Central Services 1,755.71 AT&T MOBILTY 01/12/2024 122689 2873263283 101-42400-321 AT&T BILL 10/26/23-11/25/23 Building & Zoning 165.92 AT&T MOBILTY 01/12/2024 122689 2873263283 101-45200-321 AT&T BILL 10/26/23-11/25/23 Parks 114.69 AT&T MOBILTY 01/12/2024 122689 2873263283 101-43000-321 AT&T BILL 10/26/23-11/25/23 Public Works Department 471.76 AT&T MOBILTY 01/12/2024 122689 2873263283 101-41900-321 AT&T BILL 10/26/23-11/25/23 Central Services 202.69 AT&T MOBILTY 01/12/2024 122689 2873263283 601-49400-321 AT&T BILL 10/26/23-11/25/23 121.19 AT&T MOBILTY 01/12/2024 122689 2873263283 602-49450-321 AT&T BILL 10/26/23-11/25/23 Sewer 82.96 AT&T MOBILTY 01/12/2024 122689 2873263283 101-43100-321 AT&T BILL 10/26/23-11/25/23 Brush Site 76.46 Total 122689:2,991.38 REPUBLIC SERVICES #894 01/12/2024 122690 0894-006516 101-45200-404 TRASH SERVICE Parks 2,023.50 Total 122690:2,023.50 ACTIVE911 INC 01/22/2024 122691 540337 101-42110-433 ACTIVE 911 ANNUAL RENEWAL Police Department 165.00 Total 122691:165.00 ALPHA TRAINING & TACTICS LL 01/22/2024 122692 2023-0413 101-42110-440 SWAT EQUIPMENT/OUF/REPLACEMENTS Police Department 10,911.04 Total 122692:10,911.04 AMAZON CAPITAL SERVICE 01/22/2024 122693 116W-QXC3-710-49970-221 SMART UPS REPLACEMENT BATTERY PACK 249.99 AMAZON CAPITAL SERVICE 01/22/2024 122693 116W-QXC3-101-41900-201 BULLETIN BOARD Central Services 89.99 AMAZON CAPITAL SERVICE 01/22/2024 122693 116W-QXC3-710-49970-221 USB CHARGER CABLE 17.06 AMAZON CAPITAL SERVICE 01/22/2024 122693 116W-QXC3-710-49970-221 DELL BATTERY 35.89 AMAZON CAPITAL SERVICE 01/22/2024 122693 116W-QXC3-701-49800-221 SHIPPING AND PROMOTION 38.15 AMAZON CAPITAL SERVICE 01/22/2024 122693 1V99-9W1W-101-41900-201 OFFICE SUPPLIES Central Services 31.97 AMAZON CAPITAL SERVICE 01/22/2024 122693 1V99-9W1W-101-43000-240 SHOP SUPPLIES Public Works Department 99.89 Total 122693:562.94 ANCOM TECHNICAL CENTER 01/22/2024 122694 119303 415-42260-580 FIRECOM HEADSETS TANKER/TENDER 4,761.80 ANCOM TECHNICAL CENTER 01/22/2024 122694 119308 415-42260-580 FIRECOM HEADSETS FOR USED RESCUE PUM 6,713.70 ANCOM TECHNICAL CENTER 01/22/2024 122694 119309 415-42260-580 FIRECOM HEADSETS FOR BRUSH/MEDICAL TR 6,673.70 9 City of Orono Check Register - COUNCIL REPORT Page: 2 Check Issue Dates: 1/9/2024 - 1/22/2024 Jan 18, 2024 11:52AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount Total 122694:18,149.20 BCA TRAINING & DEVELOPMEN 01/22/2024 122695 32849 101-42110-437 TRAINING/DMT/BECK Police Department 75.00 Total 122695:75.00 BOLTON & MENK INC.01/22/2024 122696 0327740 101-43000-304 2023 BRIDGE INSPECTIONS Public Works Department 745.50 BOLTON & MENK INC.01/22/2024 122696 0327771 101-43050-319 GIS MAINTENANCE WATER Public Works - Spring Park 1,414.50 Total 122696:2,160.00 BOND TRUST SERVICES CORP 01/22/2024 122697 84264 323-47000-319 GENERAL OBLIGATION BONDS SERIES 2014A 325,000.00 BOND TRUST SERVICES CORP 01/22/2024 122697 84264 322-47000-611 INTEREST 2014A 27,462.50 BOND TRUST SERVICES CORP 01/22/2024 122697 85220 323-47000-319 DEBT SERVICE SERIES 2014A 475.00 Total 122697:352,937.50 Bratt Tree Company 01/22/2024 122698 12162 101-45200-404 TREE REMOVAL Parks 2,400.00 Total 122698:2,400.00 CAMPBELL KNUTSON 01/22/2024 122699 2717-0000G 101-41600-307 ADMINISTRATION/GENERAL MATTERS Law/Legal Services 1,057.00 CAMPBELL KNUTSON 01/22/2024 122699 2717-0004G 101-42110-307 POLICE MATTERS 12/23 Police Department 136.00 CAMPBELL KNUTSON 01/22/2024 122699 2717-0201G 101-41600-307 MISC RECORDINGS 12/2023 Law/Legal Services 377.25 CAMPBELL KNUTSON 01/22/2024 122699 2717-0740G 703-49960-379 LITIGATION - MERA CLAIM 1,650.00 CAMPBELL KNUTSON 01/22/2024 122699 2717-0800G 101-42400-307 B&Z STAFF MTGS 12/23 Building & Zoning 306.00 CAMPBELL KNUTSON 01/22/2024 122699 2717-0801G 101-41600-307 COUNCIL MEETINGS 12/23 Law/Legal Services 527.00 CAMPBELL KNUTSON 01/22/2024 122699 2717-0802G 101-42400-307 B&Z ASSISTANCE 12/23 Building & Zoning 493.00 CAMPBELL KNUTSON 01/22/2024 122699 2717-0850G 101-43280-307 LA23-000019 1940 SHADYWOOD RD Special Services 49.25 CAMPBELL KNUTSON 01/22/2024 122699 2717-0884G 101-43280-307 RAS23000019 - 165 CRISTOFORI DRIVE Special Services 70.23 CAMPBELL KNUTSON 01/22/2024 122699 2717-0885G 101-43280-307 RAS23-000047 3760 WATERTOWN RD Special Services 119.48 CAMPBELL KNUTSON 01/22/2024 122699 2717-0891G 101-43280-307 RAS23-0000175-2605 NORTH SHORE DR Special Services 118.68 CAMPBELL KNUTSON 01/22/2024 122699 2717-0892G 101-43280-307 LA23-000060 - 3600 CASCO AVE Special Services 82.50 CAMPBELL KNUTSON 01/22/2024 122699 2717-0893G 101-43280-307 LA23-000045 - 1250/1260 SPRUCE PLACE Special Services 487.50 Total 122699:5,473.89 CENTRAL PENSION FUND SOU 01/22/2024 122700 01.11.24 FU 101-21705 CENTRAL PENSION FUND 01112024 938.77 10 City of Orono Check Register - COUNCIL REPORT Page: 3 Check Issue Dates: 1/9/2024 - 1/22/2024 Jan 18, 2024 11:52AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount Total 122700:938.77 Century Link 01/22/2024 122701 01.04.24-02.601-49400-321 INTERNET FOR SOUTH WATER PLANT 138.86 Total 122701:138.86 CITY OF LONG LAKE 01/22/2024 122702 20240001 101-42260-318 1ST QTR 2024 FIRE SERVICE Fire Protection Services 166,234.50 CITY OF LONG LAKE 01/22/2024 122702 4TH QTR 20 601-49400-387 4TH QTR 2023 WATER SERVICE 1,663.15 CITY OF LONG LAKE 01/22/2024 122702 4TH QTR 20 602-49450-387 4TH QTR 2023 SEWER SERVICE Sewer 3,247.75 Total 122702:171,145.40 CITY OF MEDINA 01/22/2024 122703 00008196 435-48976-590 23-001 2023 STREET IMPROVEMENTS (TOWNLI 111,093.93 Total 122703:111,093.93 CITY OF MONTICELLO 01/22/2024 122704 0027988 101-42110-318 ANIMAL CARE/SP DOG IMPOUND Police Department 194.00 Total 122704:194.00 CIVIC SYSTEMS LLC 01/22/2024 122705 CVC24167 710-49970-416 SOFTWARE SUPPORT - 1/1/24-06/30/24 8,300.00 Total 122705:8,300.00 CORNERHOUSE 01/22/2024 122706 4324 101-42110-319 2024 FORENSIC INTERVIEW SVCS Police Department 4,840.00 Total 122706:4,840.00 CORY & ANN MICHAEL KLEINH 01/22/2024 122707 108 CHEVY 999-10015 UB REFUND -108 CHEVY CHASE DR. - KLEINHA 229.92 Total 122707:229.92 ECM PUBLISHERS INC 01/22/2024 122708 980179 101-42400-340 PH FOR B&Z Building & Zoning 71.52 ECM PUBLISHERS INC 01/22/2024 122708 980306 701-49800-340 MECHANIC POSTING 349.20 Total 122708:420.72 FAUL PSYCHOLOGICAL 01/22/2024 122709 1813 101-42260-305 PSYCH TESTING MARTIN Fire Protection Services 250.00 FAUL PSYCHOLOGICAL 01/22/2024 122709 1813 101-42260-305 PSYCH TESTING FLERMOEN Fire Protection Services 650.00 11 City of Orono Check Register - COUNCIL REPORT Page: 4 Check Issue Dates: 1/9/2024 - 1/22/2024 Jan 18, 2024 11:52AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount FAUL PSYCHOLOGICAL 01/22/2024 122709 1813 101-42260-305 PSYCH TESTING JACKSON Fire Protection Services 650.00 FAUL PSYCHOLOGICAL 01/22/2024 122709 1813 101-42260-305 PSYCH TESTING ANDRES Fire Protection Services 650.00 FAUL PSYCHOLOGICAL 01/22/2024 122709 1813 101-42260-305 PSYCH TESTING SCHUMACHER Fire Protection Services 650.00 Total 122709:2,850.00 G&H Distributing & Supply Inc 01/22/2024 122710 00174631 101-43000-221 HYDRANT HOSE - UNIT 427 WING,Public Works Department 22.86 G&H Distributing & Supply Inc 01/22/2024 122710 00174698 701-49800-221 HYDRANT HOSE - UNIT 425 123.49 Total 122710:146.35 GENUINE PARTS COMPANY/NA 01/22/2024 122711 3270-589405 701-49800-222 FLOOR MATS UNIT 709 21.58 GENUINE PARTS COMPANY/NA 01/22/2024 122711 3270-589438 701-49800-222 BATTERY 307.50 GENUINE PARTS COMPANY/NA 01/22/2024 122711 3270-589641 701-49800-213 ENGINE FLUSH, TUNE UP 36.95 GENUINE PARTS COMPANY/NA 01/22/2024 122711 3270-589699 701-49800-222 WINDSHIELD WASHER NOZZLES 62.89 GENUINE PARTS COMPANY/NA 01/22/2024 122711 3270-589801 701-49800-215 OIL FILTERS 7060 - SQUADS 106.56 Total 122711:535.48 GMH ASPHALT 01/22/2024 122712 2023 PARKI 408-48800-590 21-040 NAVARRE PARKING LOT 32,436.21 GMH ASPHALT 01/22/2024 122712 2023 PARKI 408-20600 21-040 NAVARRE PARKING LOT 1,621.82- Total 122712:30,814.39 GOPHER ACE 01/22/2024 122713 18731/1 101-41900-404 PAINTING SUPPLIES Central Services 29.97 GOPHER ACE 01/22/2024 122713 18804/1 701-49800-215 SPRAY PAINT 7.99 GOPHER ACE 01/22/2024 122713 18808/1 101-45200-223 HOSE CLAMP Parks 12.18 GOPHER ACE 01/22/2024 122713 18837/1 101-41900-404 PAINTING SUPPLIES Central Services 96.44 GOPHER ACE 01/22/2024 122713 18874/1 101-43000-224 CUTTING WHEEL Public Works Department 6.59 GOPHER ACE 01/22/2024 122713 18878/1 101-41900-404 LIGHTS FOR CITY HALL Central Services 45.96 GOPHER ACE 01/22/2024 122713 18897/1 101-41900-404 TOILET REPAIR Central Services 9.78 GOPHER ACE 01/22/2024 122713 18942/1 701-49800-215 SPRAY PAINT 28.97 Total 122713:237.88 GRAINGER INC 01/22/2024 122714 9956635818 701-49800-221 STEP TO MAINTENANCE FLEET AND EQUIPMEN 136.43 Total 122714:136.43 GUARDIAN FLEET SAFETY 01/22/2024 122715 231886 101-42110-550 SQUAD SETUP #273 Police Department 19,750.27 12 City of Orono Check Register - COUNCIL REPORT Page: 5 Check Issue Dates: 1/9/2024 - 1/22/2024 Jan 18, 2024 11:52AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount GUARDIAN FLEET SAFETY 01/22/2024 122715 231889 101-42110-550 SQUAD SETUP #272 Police Department 10,432.24 GUARDIAN FLEET SAFETY 01/22/2024 122715 231890 101-42110-550 SQUAD SETUP #274 Police Department 19,983.01 GUARDIAN FLEET SAFETY 01/22/2024 122715 232070 101-42110-402 SQUAD #268 DOCKING ISSUE Police Department 190.00 Total 122715:50,355.52 HACH CHEMICAL CO 01/22/2024 122716 13869943 601-49400-227 GLASS SAMPLE BOTTLES 79.89 Total 122716:79.89 HAWKINS INC 01/22/2024 122717 6661953 601-49400-216 WATER PLANT CHEMICALS 388.41 Total 122717:388.41 HENNEPIN COUNTY INFOR TE 01/22/2024 122718 1000217123 101-42110-413 RADIO/MDC LEASES Police Department 2,930.68 HENNEPIN COUNTY INFOR TE 01/22/2024 122718 1000217146 101-43000-415 PW RADIO FIX Public Works Department 105.34 HENNEPIN COUNTY INFOR TE 01/22/2024 122718 1000217146 101-43000-415 PW RADIOS Public Works Department 296.89 Total 122718:3,332.91 HENNEPIN COUNTY SHERIFF 01/22/2024 122719 1000216866 101-41600-309 JAIL INOVICES 06/1 - 10/31/2023 Law/Legal Services 4,337.84 Total 122719:4,337.84 HENNEPIN COUNTY TREASUR 01/22/2024 122720 2023 TNT 101-41900-352 2022 TNT COSTS Central Services 1,276.00 Total 122720:1,276.00 IAPE 01/22/2024 122721 M24-C69296 101-42110-319 PROPERTY ROOM TRAINING PROGRAM -BECK Police Department 65.00 Total 122721:65.00 INTEGRITY EMPLOYEE BENEFI 01/22/2024 122722 BC227 01/08 101-41900-319 ONLINE ENROLLMENT FEE - 2024 Central Services 2,418.50 Total 122722:2,418.50 KALMAN, TODD & ELISSA 01/22/2024 122723 2900 WEAR 999-10015 UB REFUND - 2900 WEAR CIR - KALMAN, TODD 78.00 Total 122723:78.00 13 City of Orono Check Register - COUNCIL REPORT Page: 6 Check Issue Dates: 1/9/2024 - 1/22/2024 Jan 18, 2024 11:52AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount KENNETH & LINDA HOFFMANN 01/22/2024 122724 1254 LOMA 999-10015 UB REFUND - 1254 LOMA LINDA AVE - HOFFMAN 139.53 Total 122724:139.53 KODIAK POWER SOLUTIONS 01/22/2024 122725 13293163 602-49450-403 YEARLY SERVICE ON GENERATOR 13 Sewer 415.00 KODIAK POWER SOLUTIONS 01/22/2024 122725 13299692 602-49450-403 YEARLY SERVICE ON GENERATOR LS 3 Sewer 415.00 Total 122725:830.00 LAKE MTKA CONSERVATION DI 01/22/2024 122726 2024Q1Oron 651-49910-433 1ST QTR 2024 LEVY PMT Storm Water 10,200.50 Total 122726:10,200.50 LANO EQUIPMENT INC 01/22/2024 122727 03-1050663 101-43000-221 SNOWPLOW BRACKET Public Works Department 195.00 Total 122727:195.00 LAWRENCE, JAY H. & MARLIS R 01/22/2024 122728 1448 BALDU 999-10015 UB REFUND - 1448 BALDUR PARK RD - LAWREN 542.11 Total 122728:542.11 LEAGUE OF MN CITIES 01/22/2024 122729 397622 651-49910-433 MN CITIES STORMWATER COALITION Storm Water 870.00 Total 122729:870.00 LEOWEBPROTECT.com 01/22/2024 122730 8021705098 101-42110-433 MONTHLY SUBSCRIPTION 1/24 Police Department 143.06 Total 122730:143.06 MACQUEEN EQUIPMENT LLC 01/22/2024 122731 P24347 101-42260-310 RENTAL TURNOUT GEAR FOR KAYLA KENNEDY Fire Protection Services 2,557.07 Total 122731:2,557.07 MANSFIELD OIL COMPANY 01/22/2024 122732 24961660 701-49800-212 UNLEADED FUEL 2,338.84 MANSFIELD OIL COMPANY 01/22/2024 122732 MBINV-8757 701-49800-212 DIESEL FUEL 214.50 Total 122732:2,553.34 MELANIE CURTIS 01/22/2024 122733 EMP. SERV. 101-41300-489 EMPLOYEE RECOGNITION WATCH Administration 350.00 14 City of Orono Check Register - COUNCIL REPORT Page: 7 Check Issue Dates: 1/9/2024 - 1/22/2024 Jan 18, 2024 11:52AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount Total 122733:350.00 METRO CITIES 01/22/2024 122734 1759 101-41110-433 2024 MEMBERSHIP Mayor & Council 3,612.00 Total 122734:3,612.00 METROPOLITAN COUNCIL ENVI 01/22/2024 122735 0001166828 602-49450-383 WASTWATER SERVICE 1/2024 Sewer 64,223.79 Total 122735:64,223.79 MGX EQUIPMENT SERVICES LL 01/22/2024 122736 PSO051001-701-49800-221 DUMP TRUCK SALT CONTROL REPAIR PARTS 943.72 Total 122736:943.72 MICHAEL BUSINESS MACHINE 01/22/2024 122737 50079925 101-42110-201 OFFICE SUPPLIES Police Department 109.45 Total 122737:109.45 Mid-America Business Systems In 01/22/2024 122738 6212 710-49970-401 SERVICE AGREEMENT - 11/19/23-11/18/24 895.00 Total 122738:895.00 MINUTEMAN PRESS 01/22/2024 122739 35810 101-41900-352 NEWSLETTER Central Services 3,379.03 Total 122739:3,379.03 Myers Tire Supply Distribution, Inc 01/22/2024 122740 41600524 701-49800-215 TIRE WEIGHTS 98.32 Total 122740:98.32 Newegg Business Inc 01/22/2024 122741 0130485709 710-49970-221 SQUAD PRINTER 418.99 Newegg Business Inc 01/22/2024 122741 1304856669 710-49970-221 MONITORS - PD 411.76 Newegg Business Inc 01/22/2024 122741 1304857320 710-49970-221 MONITOR STAND - PD 89.98 Newegg Business Inc 01/22/2024 122741 1304860755 710-49970-221 MOUSE 34.98 Newegg Business Inc 01/22/2024 122741 1304861345 710-49970-221 KEYBOARD 69.00 Total 122741:1,024.71 NORTH MEMORIAL 01/22/2024 122742 0000095738 101-42110-437 EMR REFRESHER/BENIEK Police Department 80.00 15 City of Orono Check Register - COUNCIL REPORT Page: 8 Check Issue Dates: 1/9/2024 - 1/22/2024 Jan 18, 2024 11:52AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount Total 122742:80.00 Oertel Architects, Ltd 01/22/2024 122743 23-26.1 440-48975-319 24-034 NAVARRE STN IMPROVEMENTS 19,272.00 Total 122743:19,272.00 OFFICE DEPOT 01/22/2024 122744 3494159790 101-42110-201 OFFICE SUPPLIES Police Department 98.21 Total 122744:98.21 OPD BUSINESS SOLUTIONS LL 01/22/2024 122745 3454400520 101-42110-201 OFFICE SUPPLIES Police Department 15.08 OPD BUSINESS SOLUTIONS LL 01/22/2024 122745 3456285550 101-42110-201 MISC OFFICE SUPPLIES Police Department 111.04 OPD BUSINESS SOLUTIONS LL 01/22/2024 122745 3457837310 101-42110-201 OFFICE SUPPLIES Police Department 171.44 OPD BUSINESS SOLUTIONS LL 01/22/2024 122745 3465622070 101-42110-201 OFFICE SUPPLIES Police Department 18.99 OPD BUSINESS SOLUTIONS LL 01/22/2024 122745 3465622260 101-42110-201 OFFICE SUPPLIES Police Department 27.99 OPD BUSINESS SOLUTIONS LL 01/22/2024 122745 3494196560 101-42110-201 OFFICE SUPPLIES Police Department 47.24 Total 122745:391.78 PERFORMANCE PLUS LLC dba 01/22/2024 122746 123892 101-42260-305 MEDICAL EVAL FOR TAYLOR ANDRES Fire Protection Services 516.00 PERFORMANCE PLUS LLC dba 01/22/2024 122746 123901 101-42260-305 MEDICAL EVAL FOR TOM FLERMOEN Fire Protection Services 563.00 Total 122746:1,079.00 PHELPS, CHARLES 01/22/2024 122747 385 TURNH 999-10015 UB REFUND - 385 TURNHAM RD - CHARLES PH 631.00 Total 122747:631.00 RAYMOND HOFFMAN 01/22/2024 122748 RPS22-0001 101-22205 ESCROW REFUND-RPS22-000109 - 1000 TONKA 10,000.00 Total 122748:10,000.00 RITEWAY BUSINESS FORMS 01/22/2024 122749 24-30021 101-41900-201 CHECKS AP #123051-125450 Central Services 381.98 Total 122749:381.98 SAFEBUILT LLC 01/22/2024 122750 176599 101-42400-310 BUILDING REVIEW SERVICES Building & Zoning 187.50 16 City of Orono Check Register - COUNCIL REPORT Page: 9 Check Issue Dates: 1/9/2024 - 1/22/2024 Jan 18, 2024 11:52AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount Total 122750:187.50 SECURITY & SOUND CO 01/22/2024 122751 27772 101-41900-404 FIX DOOR DATA BASE & KERI SYSTEMS Central Services 450.00 SECURITY & SOUND CO 01/22/2024 122751 27777 710-49970-401 FIXING PODIUM AND MOVING AUDIO 852.50 Total 122751:1,302.50 SHERWIN WILLIAMS 01/22/2024 122752 0220-5 101-41900-223 PAINT SUPPLIES Central Services 46.84 Total 122752:46.84 SiteOne Landscape Supply LLC 01/22/2024 122753 136340964-0 101-45210-216 PESTICIDES Golf Course 9,338.17 SiteOne Landscape Supply LLC 01/22/2024 122753 136341441-0 101-45200-216 PESTICIDES Parks 2,060.00 Total 122753:11,398.17 STONEWOOD 01/22/2024 122754 RPS22-0001 101-22205 ESCROW REFUND - RPS22-000162 - 3005 CASC 1,000.00 Total 122754:1,000.00 STREICHERS POLICE EQUIP 01/22/2024 122755 I1668639 101-42110-226 UNIFORMS/RESERVE SCHNEIDER Police Department 54.99 STREICHERS POLICE EQUIP 01/22/2024 122755 I1668750 101-42110-226 UNIFORMS/SCHAUER Police Department 171.98 STREICHERS POLICE EQUIP 01/22/2024 122755 I1669273 101-42110-226 UNIFORMS/SCHAUER Police Department 369.94 STREICHERS POLICE EQUIP 01/22/2024 122755 I1669659 101-42110-226 UNIFORMS/BENIEK Police Department 1,534.99 STREICHERS POLICE EQUIP 01/22/2024 122755 I1670315 101-42110-226 UNIFORMS/SLIPKA Police Department 29.99 STREICHERS POLICE EQUIP 01/22/2024 122755 I1671400 101-42110-226 UNIFORM/SCHULTZ Police Department 276.00 STREICHERS POLICE EQUIP 01/22/2024 122755 I1671957 101-42110-226 UNIFORM/SCHAUER Police Department 11.99 STREICHERS POLICE EQUIP 01/22/2024 122755 I1672788 101-42110-226 UNIFORMS/OPD COLLAR BRASS Police Department 275.00 STREICHERS POLICE EQUIP 01/22/2024 122755 I1674145 101-42110-226 UNIFORM/SCHULTZ Police Department 104.00 Total 122755:2,828.88 SWENSON, JACK 01/22/2024 122756 LA23-000063 101-22205 ESCROW REFUND - LA23-000063 - 3020 NORTH 5,000.00 Total 122756:5,000.00 TimeSaver Off Site Secretarial Inc 01/22/2024 122757 M28825 101-41110-439 CC MEETING MINUTES 12/11/2023 Mayor & Council 310.00 TimeSaver Off Site Secretarial Inc 01/22/2024 122757 M28858 101-41110-439 CC MEETING MINUTES 01/08/2024 Mayor & Council 167.00 17 City of Orono Check Register - COUNCIL REPORT Page: 10 Check Issue Dates: 1/9/2024 - 1/22/2024 Jan 18, 2024 11:52AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount Total 122757:477.00 TOLL GAS & WELDING SUPPLY 01/22/2024 122758 10546933 101-43000-240 WELDING SUPPLIES Public Works Department 440.95 Total 122758:440.95 U.S. AutoForce 01/22/2024 122759 INV0003300 701-49800-222 TIRES TAHOES 1,440.00 Total 122759:1,440.00 UNIFIRST CORPORATION 01/22/2024 122760 1410033346 701-49800-221 SHOP TOWELS - PW 8.33 UNIFIRST CORPORATION 01/22/2024 122760 1410033346 101-43000-404 RUGS - PW Public Works Department 26.13 UNIFIRST CORPORATION 01/22/2024 122760 1410033346 701-49800-226 UNIFORMS-FLEET 43.36 UNIFIRST CORPORATION 01/22/2024 122760 1410033346 101-43000-226 UNIFORMS - PW Public Works Department 43.37 UNIFIRST CORPORATION 01/22/2024 122760 1410033346 602-49450-226 UNIFORMS PW-SEWER DEPT Sewer 43.36 UNIFIRST CORPORATION 01/22/2024 122760 1410033346 601-49400-226 UNIFORMS PW-WATER DEPT 43.36 UNIFIRST CORPORATION 01/22/2024 122760 1410033346 101-45200-226 UNIFORMS-PARKS Parks 43.36 UNIFIRST CORPORATION 01/22/2024 122760 1410033346 101-45210-226 UNIFORMS-GOLF COURSE Golf Course 43.36 UNIFIRST CORPORATION 01/22/2024 122760 1410033347 101-41900-223 LAUNDRY SERVICE Central Services 80.27 UNIFIRST CORPORATION 01/22/2024 122760 1410034597 101-43000-404 RUGS - PW Public Works Department 26.13 UNIFIRST CORPORATION 01/22/2024 122760 1410034597 701-49800-221 SHOP TOWELS - PW 8.33 UNIFIRST CORPORATION 01/22/2024 122760 1410034597 602-49450-226 UNIFORMS PW-SEWER DEPT Sewer 43.57 UNIFIRST CORPORATION 01/22/2024 122760 1410034597 601-49400-226 UNIFORMS PW-WATER DEPT 43.57 UNIFIRST CORPORATION 01/22/2024 122760 1410034597 101-43000-226 UNIFORMS - PW Public Works Department 43.57 UNIFIRST CORPORATION 01/22/2024 122760 1410034597 701-49800-226 UNIFORMS - FLEET 43.57 UNIFIRST CORPORATION 01/22/2024 122760 1410034597 101-45200-226 UNIFORMS-PARKS Parks 43.57 UNIFIRST CORPORATION 01/22/2024 122760 1410034597 101-45210-226 UNIFORMS-GOLF COURSE Golf Course 43.57 Total 122760:670.78 WASTE MANAGEMENT RECYC 01/22/2024 122761 0109479-280 603-49500-316 RECYCLING JAN 2024 17,963.40 WASTE MANAGEMENT RECYC 01/22/2024 122761 0109479-280 603-49500-444 ORGANICS DEC 2023 86.81 WASTE MANAGEMENT RECYC 01/22/2024 122761 0109479-280 603-49500-316 ADMINISTRATIVE FEES 8.50 Total 122761:18,058.71 WILLIAM MUELLER 01/22/2024 122762 55 FERNDAL 999-10015 UB REFUND - 55 FERNDALE GREEN - MUELLER 1,239.77 18 City of Orono Check Register - COUNCIL REPORT Page: 11 Check Issue Dates: 1/9/2024 - 1/22/2024 Jan 18, 2024 11:52AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount Total 122762:1,239.77 WILLIAMS TOWING INC 01/22/2024 122763 24-17457 101-42110-402 UNIT #266 2020 DODGE DURANGO Police Department 155.00 Total 122763:155.00 Wright-Hennepin Coop Electric 01/22/2024 122764 3503104222 101-43100-381 BRUSH SITE 12/01-01/01 Brush Site 27.45 Wright-Hennepin Coop Electric 01/22/2024 122764 3503104222 613-49830-319 GC SECURITY 02/29/2024 Golf Course 42.21 Wright-Hennepin Coop Electric 01/22/2024 122764 3503104222 101-43000-381 ELECTRICAL SERVICE 12/01/23-01/01/24 Public Works Department 205.69 Total 122764:275.35 ZACH'S, INC.01/22/2024 122765 36560 101-43000-222 CITRUS CLEANER Public Works Department 206.70 Total 122765:206.70 HOME DEPOT CREDIT SERVIC 01/12/2024 201304 11.20.23-12.2 101-41900-223 CLEANING SUPPLIES Central Services 136.80 HOME DEPOT CREDIT SERVIC 01/12/2024 201304 11.20.23-12.2 101-43000-240 UTILLITIES TOOLS FOR 709 Public Works Department 315.46 HOME DEPOT CREDIT SERVIC 01/12/2024 201304 11.20.23-12.2 101-43000-240 WEED BURNER Public Works Department 61.98 Total 20130430:514.24 CONFITREK, INC.01/22/2024 201304 1034 101-42110-319 TRAINING TRACKING PROGRAM Police Department 2,976.00 Total 20130431:2,976.00 INNOVO BENEFITS ADMINISTR 01/22/2024 201304 1352994 101-21706 HEALTH INSURANCE - 01/2024 64,749.34 INNOVO BENEFITS ADMINISTR 01/22/2024 201304 1352994 101-21706 HEALTH INSURANCE - 01/2024-COBRA NON EM 1,537.08 Total 20130432:66,286.42 MEDSURETY LLC 01/22/2024 201304 12.8.23-01.1 101-21719 FSA 12.8.23-01.14.24 82.09 MEDSURETY LLC 01/22/2024 201304 28328 101-41900-319 FEES Central Services 295.50 Total 20130433:377.59 MN DEPT OF REVENUE-WIRE 01/22/2024 201304 12.2023 Sale 101-34210 GENERAL SALES TAX 12.2023 2.00 MN DEPT OF REVENUE-WIRE 01/22/2024 201304 12.2023 Sale 101-34650 POLICE REPORT SALES TAX 24.00 MN DEPT OF REVENUE-WIRE 01/22/2024 201304 12.2023 Sale 601-39610 WATER METER SALES 12.2023 98.00 19 City of Orono Check Register - COUNCIL REPORT Page: 12 Check Issue Dates: 1/9/2024 - 1/22/2024 Jan 18, 2024 11:52AM Check Check Invoice Invoice GL Account Description Department Invoice Payee Issue Date Number Number Amount MN DEPT OF REVENUE-WIRE 01/22/2024 201304 12.2023 Sale 601-20806 WATER TAXABLE SALES 12/23 749.00 MN DEPT OF REVENUE-WIRE 01/22/2024 201304 12.2023 Sale 613-37910 GREEN FEES 32.00 MN DEPT OF REVENUE-WIRE 01/22/2024 201304 12.2023 Sale 101-37930 BEER - SALES TAX 12/23 59.00 MN DEPT OF REVENUE-WIRE 01/22/2024 201304 12.2023 Sale 101-37940 CONCESSIONS - SALES TAX 12/23 6.00 MN DEPT OF REVENUE-WIRE 01/22/2024 201304 12.2023 Sale 101-37970 PRO SHOP SALES - SALES TAX 12/23 20.00 MN DEPT OF REVENUE-WIRE 01/22/2024 201304 12.2023 Sale 613-37980 CLOTHING (HAT) SALES TAX 12/2023 2.00 Total 20130434:992.00 Grand Totals: 1,105,415.65 20 Item No.: 3 Date: January 22, 2024 Presenter: Nola Dickhausen Presenter: Management Assistant Section:Consent Agenda Title: Approval of Rental Licenses 1.Purpose: The purpose of this action item is to approve licenses for rental housing. 2.License Applicant(s): RL24-000003 3741 Livingston Court RL24-000004 3680 Livingston Avenue RL24-000005 40 Stubbs Bay Road South RL24-000006 1590 Long Lake Boulevard RL24-000007 3730 Casco Avenue RL24-000008 5 Brown Road South RL24-000009 2245 Shadywood Road RL24-000010 2460 Dunwoody Avenue RL21-000023 1230 Orono Oaks Drive RL24-000011 3285 Crystal Bay Road RL24-000013 2740 Fox Street RL24-000014 740 Tonkawa Road 3.Staff Recommendation: Application requirements are complete and staff recommends approval of the rental licenses listed above for the period of January 1, 2024 to December 31, 2025. AGENDA ITEM COUNCIL ACTION REQUESTED Motion to approve the rental licenses listed above. 21 Item No.: 4 Date: January 22, 2024 Presenter: James Van Eyll Presenter: Fire Chief Section:Consent Agenda Title: Authorization to enter into a contracts with Vector Solutions, First Due and First Arriving 1.Purpose: The council should review and authorize the three software programs identified for the Orono Fire Department. 2.Background: Council gave staff direction to complete a Needs Assessment for the City of Orono. Based on the Needs Assessment, staff has identified the following software to be used by the Orono Fire Department that fits best practices and helps the department become more efficient. 1. Vector Solutions is an online platform that is sanctioned by the Minnesota Board of Firefighter Training and Education that offers two programs. One for online training called Target Solutions and another program for assessment management call Check it. We would utilize Target Solutions to deliver online firefighter training and education to our firefighters. We would utilize Check It for our asset management software and all of our recommended apparatus, tool, SCBA and turnout gear checks by NFPA. 2. First Due is an online platform that can be used for Occupancy Management & Pre-Incident Planning, showing who is responding to the call for service, fire inspections and community connect. We would utilize this software to do all of our fire and medical pre-planning, our fire inspections and community risk reduction and online platform for our community members to input any information that they would want the fire department to know into their addressed location. 3. First Arriving is digital dashboard for the above software and many others. It takes all of information from the different platforms and displays it on monitors throughout our facilities. We would utilize this to display information about the emergency call that just came in, weather reports, schedule for the day or week and many other items. 3.Cost: 1. Vector Solutions' two components of Check It and Target Solutions annually is $4,510 and there is a one time set up charge for both of $1,600 total. 2. First Due modules annually are $5,500 for all four with a one time set up charge of $750. 3. First Arriving annually is $3,445 annually for 5 display locations along with an initial set-up fee of $995. 4.Funding: All funding for request was budgeted for in our department operating budget, which was approved in December. 5.Staff Recommendation: AGENDA ITEM 22 I recommend to authorize the use of Vector Solutions for online training platform and online apparatus checks, First Due for our inspections, pre-planning, community connections and NFIRS reporting and First Arriving for the coordination of displaying call information and other pertinent information. The Council should authorize the City of Orono to enter into a contract with Vector Solutions, First Due and First Arriving. COUNCIL ACTION REQUESTED Motion to approve the contracts with Vector Solutions, First Due and First Arriving. Exhibits First Arriving Orono (MN) Fire Department.pdf Orono Fire Dept Vector Solutions Client Agreement quote.pdf QUOTE Orono Fire Dept First Due Suite 04January2023.pdf 23 Digital Dashboard / Portal Quote Created by: Chuck Wavrunek 06 / 03 / 2023 Prepared for: Orono (MN) Fire Department 24 QUOTE Every First Arriving Dashboard Includes... Rapid Deployment • Get up in running quick with our core features plus scheduled development of your integrations and requirements. Best In-Class Backend & Security • AWS GovCloud-powered applications, secure data and backups. Standard Weather Features • Radar, Current Conditions, 3-Day Forecast & Severe Weather Aler ts. Zoned Delivery • Easily segment and manage content, features & integrations by location, station, battalion, division worksite and more. Support & Training • Email, ticket, chat, and phone support, documentation and system status updates, regular customer newsletters and webinars. Custom Alert Tones • Add your own alert tones! Display Options • Dedicated Large Screen TVs Locked-in Kiosk mode with dedicated hardware for always on display, typically 43-55″ TVs/Displays. Hardware included with lifetime warranty and replacement or provide your own including dedicated always-on displays via browser, Mac, Windows or iPad great for oces, on the go, home oces and second-screens Even More Features • Slides, PDFs & images • Menu & touchscreen – easily access content • Ad free – all your content, no ads • RSS feeds, social media • Embed HTML/web pages • Trac cams • Custom logo & color scheme • Calendars, news, ticker & announcements • Messaging & videos Page 2 of 5 25 QUOTE Your Dashboard Subscription Includes • All existing features and integrations • Hardware & HDMI cables included with LIFETIME warranty, replacement and upgrades (Excluding TVs/Displays). • Unlimited Admin Users with real-time device status access • Access to portal for on-demand and scheduled messages, videos and other upcoming features • Virtual onboarding and training • Full support access including virtual check-ins, ticket, phone, and chat support, new feature updates, customer webinars and newsletter updates • Zoned setup & content management agency / department wide, station, facility, division, oce, etc. • Additional Dispatch Feeds including CAD feeds, XML, API, email, text parsers for alerting & notications. We can use just about anything - additional API fee may apply for new integrations • Share content between agencies • Zoom Meetings Easily jump into Zoom meetings from your Dashboard, including connected cameras and audio • Expanded Mapping Options including ESRI, Mapbox and other GIS solutions • County and regional programs • Enhanced CAD, alerting & weather options and features available • Real-time unit status updates (requires data push from agency) • Virtual onboarding and training • Fully customized solution with unique development, layouts, and data resources available (additional fee may apply for non-standard integrations) • Enhanced zoned delivery • Custom FAQs for content users • Volume discounts on subscriptions and hardware Page 3 of 5 26 QUOTE Quote for Orono (MN) Fire Department Oer Valid Through:07 / 01 / 2024 Proposed By: Chuck Wavrunek Quote Number 00000108 QUOTE INFORMATION Company Information Billing Address Shipping Address 2750 Kelley Parkway 2750 Kelley Parkway Orono, MN 55356 Orono, MN 55356 United States United States Billing Information Billing Company Name:Orono (MN) Fire Department Billing Contact Name:James Van Eyll Billing Email Address:jvaneyll@oronomn.gov Terms and Conditions Payment Terms:Net 21 Order Terms (Months):12 SERVICES Product Name Price QTY Subtotal Dashboard Setup - Up to 5 Stations Agency setup (one-time) for up to 5 stations $995.00 1 $995.00 Dashboard Subscription with Hardware First Arriving Dashboard licenses including lifetime hardware warranty & replacement, one device per station/location $749.00 3 $2,247.00 Additional Dashboard Subscription with Hardware Additional devices for station/location, including lifetime warranty and replacement $599.00 2 $1,198.00 Subtotal $4,440.00 Total $4,440.00 COST AFTER FIRST YEAR: 3,445.00 Page 4 of 5 27 QUOTE 120+ INTEGRATIONS & FEATURES Hundreds of Layout, Data & Display Options First Arriving Dashboards integrate with a growing list of leading public safety, local government and business focused technologies and platforms, giving you many options to tailor your dashboards what matters most to your agency, business or department. Don't see your technology partner, service or feature listed? Just ask us and we'll look at adding it or creating a custom content management platform for you. BROWSE ALL INTEGRATIONS & FEATURE OPTIONS HERE MORE FIRST ARRIVING CAN DO FOR YOU Did you know First Arriving provides more technology and marketing services for public safety agencies, businesses and non-prots? • Custom Websites • Marketing Agency Services • Branding & Design • Video Production • Advertising Management • Fire/EMS & Public Safety Recruitment & Retention • Social Media Management & Marketing Ask your business development/sales representative, visit FirstArriving.com, email getstarted@rstarriving.com or call 240-667-7755 to learn more today. Page 5 of 5 28 Quote ID Q-311860 Valid Until Wednesday, January 31, 2024 Contact Name Scott Pallack Page 1 Public Sector SaaS Rev. U (Issued 02.02.2022) TargetSolutions Learning, LLC Agreement Schedule A Date: Tuesday, January 9, 2024 Client Information Client Name: Orono Fire Department (MN) Address: 2750 Kelley Parkway Long Lake, MN 55356 Primary Contact Name: James Van Eyll Primary Contact Phone: 952-249-4631 Agreement Term Effective Date: 01/31/2024 Initial Term: 36 months Invoicing Contact Information (Please fill in missing information) Billing Contact Name: James Van Eyll Billing Address: 2750 Kelley Parkway Long Lake, Minnesota 55356 Billing Phone: 952-249-4631 Billing Email: jvaneyll@oronomn.gov PO#: Billing Frequency: Annual Payment Terms: Net 30 Annual Fee(s) Product Code Product Description Minimum Annual Commitment Price Sub Total TSCHECKIT- AV Vector Check It - Minimum Purchase up to 25 users 1 $1,500.00 $1,500.00 TSPREMIER Vector LMS, TargetSolutions Edition Premier Membership Training management for public entities and professionals 25 $103.00 $2,575.00 TSMAINTFEE S Vector LMS, TargetSolutions Edition - Maintenance Fee Annual maintenance of Vector LMS, TargetSolutions Edition 1 $435.00 $435.00 Annual Total::$4,510.00 29 Page 2 Public Sector SaaS Rev. U (Issued 02.02.2022) One-Time Fee(s) Product Code Product Description Qty Price Sub Total CHECKITIMP Check It One-time Implementation Fee 1 $800.00 $800.00 TSPS-IMP Vector LMS, TargetSolutions Edition Implementation Investment One Time set-up and implementation fee; includes site customization, training and data upload support 1 $800.00 $800.00 One-Time Total: $1,600.00 Grand Total (including Annual and One -Time): $6,110.00 Please note this is not an invoice. An invoice will be sent within fourteen (14) business days. Additional Terms and Conditions. The following are in addition to the Client Agreement General Terms and Conditions. 1. Additional Named Users added after the Effective Date will be invoiced at the full per Named User fee. Such additional Named Users shall become part of the Minimum Annual Commitment for subsequent years, on the anniversary date of each contract year or upon renewals under the Agreement. 2. You agree to pay for the number of Named Users using or licensed to access the Services in a given contract year. Subject to the Minimum Annual Commitment, Changes in Named User counts will be reflected in the annual contract amount from that period forward for all Users. 3. Subject to the above Minimum Annual Commitment, annual fees for your use of the Services will be based upon the number of Named Users in a given contract year. 4. Named Users deactivated in a given contract year will not count towards the total number of Named Users in the year following such deactivation, unless reactivated. 5. Fees, both during the Initial Term, as well as any Renewal Terms, shall be increased by 5.0% per contract year. Changes in Named User counts will be reflected in the annual contract amount from that period forward for all Users. 6. All undisputed invoices are due and payable Net 30 days after invoice date (“Due Date”). Any fees unpaid for more than 10 days past the Due Date shall bear interest at 1.5% per month or the highest applicable rate permitted by law. 7. AUTOMATIC RENEWAL. UNLESS OTHERWISE AGREED OR WHERE PROHIBITED BY APPLICABLE LAW OR REGULATION, UPON EXPIRATION OF THE ABOVE INITIAL TERM, THIS AGREEMENT WILL RENEW FOR A RENEWAL TERM EQUAL TO THE INITIAL TERM AT VECTOR SOLUTIONS’ THEN CURRENT FEES, UNLESS NOTICE IS GIVEN BY EITHER PARTY OF ITS INTENT TO TERMINATE THE AGREEMENT AT LEAST SIXTY (60) DAYS PRIOR TO THE SCHEDULED TERMINATION DATE. Address for Notices: 4890 W. Kennedy Blvd., Suite 300 Tampa, FL 33609 2750 Kelley Parkway Long Lake, MN 55356 30 Page 3 Public Sector SaaS Rev. U (Issued 02.02.2022) VECTOR SOLUTIONS PUBLIC SECTOR SOFTWARE AS A SERVICE AGREEMENT This Vector Solutions Software as a Service Agreement (the “Agreement”), effective as of the date noted in the attached Schedule A (the “Effective Date”), is by and between TargetSolutions Learning, LLC, d/b/a Vector Solutions, (“We/Us””) a Delaware limited liability company, and the undersigned customer (“You/Your”), (each a “Party” or “Parties) and governs the purchase and ongoing use of the Services described in this Agreement. GENERAL TERMS AND CONDITIONS 1. SERVICES. We shall provide the following Software as a Service (“Services”): 1.1. Access and Use. We grant You a non-exclusive, non-transferable revocable authorization to remotely access and use the software as a service offering identified in Schedule A (the “Services”) and, unless prohibited by law, We will provide access to any persons You designate for use as described in these terms and conditions. For clarification, We authorize access and use on a “one user per one authorization basis” and once granted, You are not allowed to transfer authorizations to other users. Your ability to use the Services may be affected by minimum system requirements or other factors, such as Your Internet connection. 1.2. Availability. We will use commercially reasonable efforts to provide access to and use of the Services twenty-four (24) hours a day, seven (7) days a week, subject to scheduled downtime for routine maintenance, emergency maintenance, system outages, and other outages beyond our control. 1.3. Help Desk. We will assist You as needed on issues relating to usage via e-mail, and a toll-free Help Desk five (5) days per week, at scheduled hours, currently 8:00am to 6:00 pm Eastern Time, Monday-Friday or https://support.vectorsolutions.com/s/contactsupport 1.4. Upgrades and Updates. We reserve the right, in our discretion, to make updates or upgrades to the Services that are necessary or useful to: (a) maintain or enhance: (i) the quality or delivery of the Services; (ii) the competitive strength of or market for the Services; or (iii) the Services’ cost efficiency or performance; or (b) to comply with applicable law. For no additional charge, You will receive access to any general upgrades and updates to the Services which We make generally available to our other customers. All updates and upgrades to the Services are subject to these terms and conditions. 1.5 Additional Services. From time to time, the Parties may decide in their discretion to add additional Services, subject to the Parties’ execution of one or more change forms which shall be substantially in the form of the Schedule A and shall incorporate these terms and conditions by reference. Each individual Schedule A shall have its own service term. 2. YOUR RESPONSIBILITIES AND USE RESTRICTIONS. 2.1. Compliance. You shall be responsible for all Users’ compliance with this Agreement and shall use commercially reasonable efforts to prevent unauthorized access to or use of the Services. You shall comply with all applicable laws, standards, and regulations and will not use the Services in a manner not specified or permitted by Us. 2.2. Identify Named Users. A “Named User” is defined as Your employees, consultants, contractors, and agents You authorize to access and use the Services You are purchasing during each contract year (“Term”) of the Agreement. 2.2.1. You will be responsible for the following: (a) cause each of Your Named Users to complete a unique profile if not created by Vector Solutions on their behalf; and (b) timely maintain a user database by adding a unique profile for each new Named User. Due to licensing and data retention requirements, Named Users may not be removed from our system unless required by law. You will be responsible for identifying Named Users from time to time during the Term of this Agreement through available system capabilities. 2.3. Future Functionality. You agree that Your purchases are not contingent on Our delivery of any future functionality or features. You are not relying on any comments regarding future functionality or features. 3. FEES AND PAYMENTS. 3.1. Fees and Payment. You will pay for the Services in accordance with the payment terms, frequency, and fee schedule in Schedule A attached to this Agreement. All fees collected by Us under this Agreement are fully earned when due and nonrefundable when paid, except if You terminate this Agreement for cause as described in Section 5.2. 3.2. Due Date. All fees due under this Agreement must be paid in United States Dollars or Canadian Dollars or as specified in Schedule A as applicable to Your location. We will invoice You in advance and all undisputed invoices are due and payable on the due date specified in Schedule A. 3.3. Suspension of Service. If You do not make an undisputed payment on time, We may suspend Your or Your Named Users’ access to the Services without further notice until all overdue payments are paid in full. Our suspension of Your use of the Services or termination of the Agreement for Your violation of the terms of this Agreement will not change Your obligation to pay any and all payments due for the applicable Term. 31 Page 4 Public Sector SaaS Rev. U (Issued 02.02.2022) 3.3.1. We may also suspend, terminate, or otherwise deny Your access or any Named User’s access to or use of all or any part of the Services, without incurring any liability to You, if: (a) We receive a judicial or other governmental demand or order, subpoena, or law enforcement request that expressly or by reasonable implication requires Us to do so; or (b) We believe, in good faith and reasonable discretion, that: (i) You or any Named User, have failed to comply with any term of this Agreement, or accessed or used the Services beyond the scope of the rights granted, or for a purpose not authorized under this Agreement; or (ii) Your use of the Services causes a direct or indirect threat to our network function or integrity, or to Our other customers' ability to access and use the Services; or (iii) You or any Named User, are or have been involved in any fraudulent, misleading, or unlawful activities relating to or in connection with any of the Services; or (iv) this Agreement expires or is terminated. This Section 3.3 does not limit any of Our other rights or remedies under this Agreement. 3.4. Taxes. All fees under this Agreement exclude all sales, use, value-added taxes, and other taxes and government charges, whether Federal, State, or foreign, and You will be responsible for payment of all such taxes (other than taxes based on our income), fees, duties, and charges, and any related penalties and interest, arising from the payment of any and all fees under this Agreement including the access to or performance of the Services hereunder. If We have a legal obligation to pay or collect taxes for which You are responsible under the Agreement, then then We will invoice, and You will pay the appropriate amount unless You claim tax exempt status for amounts due under this Agreement and provide Us with a valid tax exemption certificate (authorized by the applicable governmental authority) promptly upon execution of this Agreement. If any taxes shall be required by law to be deducted or withheld from any fee payable hereunder by You to Us, You shall, after making the required deduction or withholding, increase such fee payable as may be necessary to ensure that We shall receive an amount equal to the fee We would have received had no such deduction or withholding been made. 4. INTELLECTUAL PROPERTY RIGHTS. 4.1. We alone (and our licensors, where applicable) shall own all rights, title, and interest in and to our software, website and technology, the course content (if any), and the Services We provide, including all documentation associated with the Services. If You provide any suggestions, ideas, enhancement requests, feedback, recommendations, or other information provided by You (collectively “Feedback”), We may use such Feedback to improve the Services without charge, royalties, or other obligation to You, and Our use of Your Feedback does not give You any property rights to the Services. The Vector Solutions name and logo are trademarks of Vector Solutions, and no right or license is granted to You to use them. You shall own all rights, title, and interest in and to Your added software, Your content, and information collected from Your content pages (“Your Data”). You shall have no rights in or to any other data collected that is not affiliated with You. Your content, email addresses, and personal information of Your Named Users or Your EHS Active Employees You entered into the database, or any of Your customers or users is Your sole property. We will not, at any time, redistribute, share, or sell any of Your email addresses, email server domain names, customer names, or personal information. Course content that You purchase from third-party course providers and access through our LMS will require the sharing of certain user information with Us in order for Us to properly track and report usage. 4.2. You recognize that We regard the software We have developed to deliver the Services as our proprietary information and as confidential trade secrets of great value. You agree not to provide or to otherwise make available in any form the software or Services, or any portion thereof, to any person other than Your Named Users without our prior written consent. You further agree to treat the Services with at least the same degree of care with which You treat Your own confidential information and in no event with less care than is reasonably required to protect the confidentiality of the Services. 4.2.1 Except as otherwise agreed in writing or to the extent necessary for You to use the Services in accordance with this Agreement, You are not allowed to: (a) copy the course content in whole or in part; (b) display, reproduce, create derivative works from, transmit, sell, distribute, rent, lease, sublicense, transfer or in any way exploit the course content in whole or in part; (c) embed the course content into other products; (d) use any of our trademarks, service marks, domain names, logos, or other identifiers or any of our third party suppliers; (e) reverse engineer, decompile, disassemble, or access the source code of any of our Services or software, (f) use the software or Services for any purpose that is unlawful; (g) alter or tamper with the Services and/or associated documentation in any way; (h) attempt to defeat any security measures that We may take to protect the confidentiality and proprietary nature of the Services; (i) remove, obscure, conceal, or alter any marking or notice of proprietary rights that may appear on or in the Services and/or associated documentation; or (j) except as permitted by this Agreement, knowingly allow any individual or entity under Your control to access Services without authorization under this Agreement for such access. 4.3. We acknowledge that You alone shall own all rights, title, and interest in and to Your name, trademarks, or logos, and this Agreement does not give Us any rights of ownership to the same. You hereby authorize Us to use Your name, trademarks, or logos in promotional materials, press releases, advertising, or in other publications or websites, whether oral or written. If You do not consent to Our use of Your name or logo, You may withdraw Your consent at any time by notifying Us at logousage@vectorsolutions.com. 5. TERM, TERMINATION, AND NOTICE. 5.1 Term. The term of this Agreement will start on the Effective Date, and will remain in full force and effect for the initial term (the “Initial Term”) indicated in Schedule A. Upon expiration or early termination of this Agreement by either Party as described below in Section 5.2 (Termination for Cause) or for any reason, You shall immediately discontinue all use of the Services and documentation, and You acknowledge that We will terminate Your ability to access the Services. Notwithstanding, access to the 32 Page 5 Public Sector SaaS Rev. U (Issued 02.02.2022) Services may remain active for thirty (30) days solely for purpose of our record keeping (the “Expiration Period”). If You continue to access or use the Services following the Expiration Period, then Your continued use will renew the Agreement under the same terms and conditions, subject to any annual price adjustments. 5.2 Termination for Cause. Either Party may terminate this Agreement, effective upon written notice to the other Party (the “Defaulting Party”), if the Defaulting Party materially breaches this Agreement, and that breach is incapable of cure, or with respect to a material breach capable of cure, and the Defaulting Party does not cure the breach within thirty (30) days after receipt of written notice of the breach. If You terminate this Agreement due to Our material breach, then We will return an amount equal to the pro-rated fees already paid for the balance of the term as of the date of termination as Your only remedy. 5.3. Notice. All required notices by either Party shall be given by email, personal delivery (including reputable courier service), fees prepaid, or by sending the notice by registered or certified mail return receipt requested, postage prepaid, and addressed as set forth in Schedule A. Such notices shall be deemed to have been given and delivered upon receipt or attempted delivery (if receipt is refused), as the case may be, and the date of receipt identified by the applicable postal service on any return receipt card shall be conclusive evidence of receipt. Notices and other communications sent by e-mail shall be deemed received upon the sender's receipt of an acknowledgment from the recipient (such as by the "return receipt requested" function, as available, return e-mail or other written acknowledgment). Either Party, by written notice to the other as described above, may alter its address for written notices. 6. MUTUAL WARRANTIES AND DISCLAIMER. 6.1. Mutual Representations and Warranties. Each Party represents and warrants to the other Party that: (a) it is duly organized, validly existing, and in good standing as a corporation or other entity under the Laws of the jurisdiction of its incorporation or other organization; (b) it has the full right, power, and authority to enter into and perform its obligations and grant the rights, licenses, consents, and authorizations it grants or is required to grant under this Agreement; (c) the acceptance of this Agreement has been duly authorized by all necessary corporate or organizational action ; and (d) when executed and delivered by both Parties, this Agreement will constitute the legal, valid, and binding obligation of each Party, enforceable against each Party in accordance with its terms. 6.2. Disclaimer. EXCEPT AS EXPRESSLY PROVIDED HEREIN, NEITHER PARTY MAKES ANY WARRANTIES OF ANY KIND, WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, INCLUDING ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW. WE DO NOT WARRANT THAT THE USE OF THE SERVICES WILL BE UNINTERRUPTED OR ERROR FREE. THE SERVICES AND ASSOCIATED DOCUMENTATION ARE PROVIDED “AS IS,” AND WE PROVIDE NO OTHER EXPRESS, IMPLIED, STATUTORY, OR OTHER WARRANTIES REGARDING THE SERVICES OR ASSOCIATED DOCUMENTATION. 6.3. Disclaimer of Third-Party Content. If You upload third-party content to our platform or Services, the third- party content providers are responsible for ensuring their content is accurate and compliant with national and international laws. We are not and shall not be held responsible or liable for any third-party content You provide or Your use of that third-party content. THERE IS NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED, OR STATUTORY, REGARDING THIRD PARTY CONTENT ACCESSIBLE THROUGH THE SERVICES. 6.4 None of our employees, marketing partners, resellers, or agents are authorized to make any warranty other than the Warranties stated in this Agreement. The provisions in any specification, brochure, or chart are descriptive only and are not warranties. 7. LIMITATION OF LIABILITY. EXCEPT FOR CLAIMS RELATED TO VIOLATION OF INTELLECTUAL PROPERTY RIGHTS, GROSS NEGLIGENCE, FRAUD, OR WILFULL MISCONDUCT, (A) IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY, ANY AFFILIATE, THIRD-PARTY, OR YOUR USERS, WHETHER IN CONTRACT, WARRANTY, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, FOR SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT, AND (B) IF YOU HAVE ANY BASIS FOR RECOVERING DAMAGES (INCLUDING FOR BREACH OF THIS AGREEMENT), YOU AGREE THAT YOUR EXCLUSIVE REMEDY WILL BE TO RECOVER DIRECT DAMAGES FROM US, UP TO AN AMOUNT EQUAL TO THE TOTAL FEES ALREADY PAID TO US FOR THE PRECEDING TWELVE (12) MONTHS. 7.1.1. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, WHATEVER THE LEGAL BASIS FOR THE CLAIM, UNDER NO CIRCUMSTANCES SHALL WE BE LIABLE TO YOU, ANY AFFILIATE, ANY THIRD PARTY OR YOUR USERS FOR ANY CLAIM, CAUSE OF ACTION, DEMAND, LIABILITY, DAMAGES, AWARDS, FINES, OR OTHERWISE, ARISING OUT OF OR RELATING TO PERSONAL INJURY, DEATH, OR OTHER HARM CAUSED FROM USE OF OR RELIANCE ON THE CONTENT OF THE COURSES OR SERVICES. YOU, YOUR AFFILIATES, EMPLOYEES, CONTRACTORS, AGENTS, USERS, AND REPRESENTATIVES RELY ON THE CONTENT OF THE COURSES AND SERVICES AT YOUR OWN RISK. SOME JURISDICTIONS DO NOT ALLOW THE EXCLUSION OR LIMITATION OF CERTAIN TYPES OF DAMAGES SO, SOLELY TO THE EXTENT SUCH LAW APPLIES TO YOU, THE ABOVE LIMITATIONS AND EXCLUSIONS MAY NOT APPLY TO YOU. 8. OBLIGATIONS OF BOTH PARTIES. 33 Page 6 Public Sector SaaS Rev. U (Issued 02.02.2022) 8.1. Our Obligation to You. We shall indemnify and hold You harmless from any and all claims, damages, losses, and expenses, including but not limited to reasonable attorney fees, arising out of or resulting from any third-party claim that any document, course, or intellectual property We provide or upload to our platform infringes or violates any intellectual property right of any person. 8.2. Your Obligation to Us. To the extent not prohibited by applicable law, You shall indemnify and hold Us harmless from any and all claims, damages, losses, and expenses, including but not limited to reasonable attorney fees, arising out of or resulting from any third-party claim that any document, courses, or intellectual property You provide or upload to our platform infringes or violates any intellectual property right of any person. 9. CONFIDENTIALITY. 9.1. Each Party may from time to time disclose to the other Party “Confidential Information” which shall mean and include the Services (including without limitation all courses accessed through the Services), all documentation associated with the Services, software code (include source and object code), marketing plans, technical information, product development plans, research, trade secrets, know-how, ideas, designs, drawings, specifications, techniques, programs, systems, and processes. 9.2. Confidential Information does not include: (a) information generally available to or known to the public through no fault of the receiving Party; (b) information known to the recipient prior to the Effective Date of the Agreement; (c) information independently developed by the recipient outside the scope of this Agreement and without the use of or reliance on the disclosing Party’s Confidential Information; or (d) information lawfully disclosed by a third party. The obligations set forth in this Section shall survive termination of this Agreement. 9.3. Each Party agrees that it shall not disclose the Confidential Information of the other to any third party without the express written consent of the other Party, that it shall take reasonable measures to prevent any unauthorized disclosure by its employees, agents, contractors or consultants, that it shall not make use of any such Confidential Information other than for performance of this Agreement, and that it shall use at least the same degree of care to avoid disclosure of Confidential Information as it uses with respect to its own Confidential Information. 9.4. The confidentiality obligations imposed by this Agreement shall not apply to information required to be disclosed by compulsory judicial or administrative process or by law or regulation, provided that the receiving Party shall (if permitted) notify the disclosing Party of the required disclosure, shall use reasonable measures to protect the confidentiality of the Confidential Information disclosed, and shall only disclose as much Confidential Information as is required to be disclosed by the judicial or administrative process, law, or regulation. 10. MISCELLANEOUS. 10.1. Assignment. Neither Party may freely assign or transfer any or all of its rights without the other Party’s consent, except to an affiliate, or in connection with a merger, acquisition, corporate reorganization, or sale of all or substantially all of its assets, provided however You shall not assign this Agreement to our direct competitors. 10.2. Governing Law. This Agreement shall be governed by, and enforced in accordance with, the laws of the state of Florida, except where Customer is a public entity or institution in which case the applicable state, provincial, or tribal law where You are located shall govern, in either case without regard to the state’s or local laws conflicts of laws provisions. If You are purchasing goods under this Agreement, the Parties agree that the United Nations Convention on Contracts for the International Sale of Goods and the United Nations Convention on the Limitation Period in the International Sale of Goods shall not apply to this Agreement. EACH PARTY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY ACTION ARISING HEREUNDER. 10.3. Export Regulations. All Content and Services and technical data delivered under this Agreement are subject to applicable US and Canadian laws and may be subject to export and import regulations in other countries. Both Parties agree to comply strictly with all such laws and regulations and You knowledge that You are responsible for obtaining such licenses to export, re- export, or import as may be required after delivery. 10.4. Force Majeure. In no event will either Party be liable or responsible to the other Party or be deemed to have defaulted under or breached this Agreement, for any failure or delay in fulfilling or performing any term of this Agreement, (except for any obligations to make payments) when and to the extent such failure or delay in performing is due to, or arising out of, any circumstances beyond such Party’s control (a “Force Majeure Event”), including, without limitation, acts of God, strikes, lockouts, war, riots, lightning, fire, storm, flood, explosion, interruption or delay in power supply, computer virus, governmental laws, regulations, or shutdown, national or regional shortage of adequate power or telecommunications, or other restraints. 10.5. No Waiver. No waiver, amendment or modification of this Agreement shall be effective unless in writing and signed by the Parties. 10.6. Severability. If any provision of this Agreement is found to be contrary to law by a court of competent jurisdiction, such provision shall be of no force or effect, but the remainder of this Agreement shall continue in full force and effect. 10.7. Survival. All provisions of this Agreement (including without limitation those pertaining to confidential information, intellectual property ownership, and limitations of liability) that would reasonably be expected to survive expiration or early termination of this Agreement will do so. 34 Page 7 Public Sector SaaS Rev. U (Issued 02.02.2022) 10.8. No Third-Party Beneficiaries. The Parties do not intend to confer any right or remedy on any third party under this Agreement. 10.9. Purchase Orders. You may issue a purchase order if required by Your company or entity and failure to do so does not cancel any obligation You have to Us. If You do issue a purchase order, it will be for Your convenience only. You agree that the terms and conditions of this Agreement shall control. Any terms or conditions included in a purchase order or similar document You issue that conflict with the terms and conditions of this Agreement will not apply to or govern the transaction resulting from Your purchase order. 10.10. Data Processing Agreement. If applicable, the parties shall negotiate in good faith and enter into any further data processing or transfer agreement, including any standard contractual clauses for transfers of data outside of the country where the personal data originates, as may be required to comply with applicable laws, rules and regulations regarding the collection, storage, transfer, use, retention and other processing of personal data. 10.11. Entire Agreement. This Agreement and Schedule A represent the entire understanding and agreement between the Parties, and supersedes all other negotiations, proposals, understandings, and representations (written or oral) made by and between You and Us. You acknowledge and agree that the terms of this Agreement are incorporated in, and are a part of, each purchase order, change order, or Schedule related to our provision of Services. This Agreement prevails over any additional or conflicting terms or conditions in any Customer purchase orders, online procurement terms, or other non-negotiated forms relating to the Services or this Agreement hereto even if dated later than the effective date of this Agreement. SPECIAL TERMS AND CONDITIONS CALIFORNIA CONSUMER PRIVACY ACT If We will be processing personal information subject to the California Consumer Privacy Act, sections 1798.100 to 1798.199, Cal. Civ. Code (2018) as may be amended as well as all regulations promulgated thereunder from time to time (“CCPA”), on Your behalf in the course of the performance of the Services, then the terms “California consumer,” “business purpose,” “service provider,” “sell” and “personal information” shall carry the meanings set forth in the CCPA. CCPA Disclosures: To the extent the CCPA applies to our processing of any personal information pursuant to Your instructions in relation to this Agreement, the following also apply: (a) The Parties have read and understand the provisions and requirements of the CCPA and shall comply with them; (b) It is the intent of the Parties that the sharing or transferring of personal information of California consumers from You to Us, during the course of our performance of this Agreement, does not constitute selling of personal information as that term is defined in the CCPA, because You are not sharing or transferring such data to Us for valuable consideration; (c) We will only use personal information for the specific purpose(s) of performing the Services, including any Schedules within the direct business relationship with You. SERVICE SPECIFIC TERMS AND CONDITIONS A. Vector EHS Management Services A. This Section A contains service specific terms and conditions that will apply only if You are purchasing Vector EHS Management Services (“EHS Services”) in Schedule A. Otherwise, the following terms will not apply to You. 1. An “EHS Active Employee” is defined as Your employees, consultants, contractors, and agents who are contained in the Vector EHS employee and contractor table with an active status. An employee may or may not be a Named User. For EHS Services, You are allowed a Named User for each EHS Active Employee. 2. You will be able to activate or disable employees without incurring additional EHS Active Employee fees as long as the total number of EHS Active Employees does not exceed the number of employees included in Scheduled A. 3. EHS Active Employees added after the Effective Date in Schedule A shall be billed at the full per employee fee. Such additional EHS Active Employees shall become part of the Minimum Annual Commitment for subsequent years, on the anniversary date of each contract year or upon renewals under the Agreement. 4. You agree to pay for the number of EHS Active Employees in the EHS Services in a given contract year. 5. Subject to the Minimum Annual Commitment, if any, set forth in Schedule A, annual fees for Your use of the Services will be based upon the actual number of EHS Active Employees in a given contract year. Employees inactivated in a given contract year will not count towards the total number of employees in the year following such inactivation, unless reactivated. 6. You acknowledge that certain transmissions You receive as part of the EHS Services may contain sensitive personal information that You have provided. You understand that We do not control or own the data contained in such transmissions. As such, You will be responsible for ensuring that the information is secured and preventing the transmission and/or disclosure of such information to unauthorized recipient(s). In the event such information is disclosed to an unauthorized recipient(s), You shall be responsible for notifying Your EHS Active Employee(s) whose information may have been disclosed 35 Page 8 Public Sector SaaS Rev. U (Issued 02.02.2022) to the extent required by law. Both Parties further agree to handle such data in compliance with any applicable Federal, State, or local laws or regulations. You shall also be responsible for any threatening, defamatory, obscene, offensive, or illegal content or conduct of any of Your EHS Active Employees when using the Services. To the extent not prohibited by applicable law, You shall indemnify, defend, and hold Us harmless against any claims that may arise as a result of these matters. With respect to Your use of the EHS Services, You acknowledge that We are not a covered entity or business associate under HIPAA. B. Vector WorkSafe Services and Vector LiveSafe Services This Section B. contains service specific terms and conditions that will apply if You are licensing or using Vector WorkSafe Services, LiveSafe Essentials or Vector LiveSafe Services (collectively “LiveSafe Services”) in Schedule A. Otherwise, the following terms will not apply to You. 1. Authorized Users. Authorized Users (interchangeably may be referred to as “Named Users” means the employees, contractors and/or consultants under Your control who You authorized to operate the LiveSafe Services . 2. Your Responsibilities. You shall: (i) not permit any person or entity, other than designated Authorized Users, to access the LiveSafe Services; (ii) use commercially reasonable efforts to prevent unauthorized access to or use of the LiveSafe Services, (iii) provide prompt written notice of any unauthorized access or use; and (iv) instruct Authorized Users to comply with all applicable terms of this Agreement. 3. Your Data. You agree that We may only use data collected, extracted or received through Your use of the Services (“Your Data”) in an anonymized and aggregated manner (without specifically identifying You, Your users or Your location(s)) for the sole purpose of reporting LiveSafe Services metrics, training and education about the LiveSafe Services, and improving the LiveSafe Services (except as may be required by law, court order, or as needed to provide the Services to You). Your Data shall not include any information collected, extracted, or received in response to the WorkSafe Integrated Health Survey. Within thirty (30) business days following Your written request, and not more than four (4) times per year or upon termination of this Agreement, We will provide to You a backup copy of Your Data in Our possession. C. Vector Evaluations+ Services. This Section C. contains service specific terms and conditions that will apply only if You are purchasing Vector Evaluations+ Software as a Service in Schedule A. Otherwise, the following terms will not apply to You. 1. Access and Use. We will provide You a nonexclusive, non-transferable, revocable authorization to remotely access and use the Vector Evaluations+ Software as a Service: (i) on Our application server over the Internet, (ii) transmit data related to Your use of the Service over the Internet, and (iii) download and use the Evals + mobile device application software (referred to collectively as “Evals+ Services”). We will provide accounts for Your users on the application server for storage of data and use of the Service. The number of Named Users, start of service, and duration, are as stated in Schedule A. 2. If Your active user accounts exceed the number of Named Users during the term of this Agreement, You agree to pay for the additional Users, based on the per User fees in Schedule A. Adjusted fees will apply beginning on the month the number of Named Users are exceeded and will be prorated for the remainder of the current 12-month period. You agree to pay for the number of Users using or authorized to access the Services in a given contract year. 3. Your Content. You will be the owner of all content created and posted by You. You will also be the owner of all content created and posted by Us on Your behalf, including but not limited to evaluation forms added to the system as part of support services We provide. 4. Third-Party Content. You are responsible for proper licensing of, and assuming liability for, copyrighted material which You post on Our system, or is posted on the system by Us on Your behalf. This includes but is not limited to copyright protected evaluation forms and other materials from third parties. If You upload third-party content to Our platform, such third-party content providers are responsible for ensuring their content is accurate and compliant with national and international laws. 5. Effect of Termination. You will have thirty (30) days after the effective date of termination or expiration of this Agreement to export Your data using the software tools provided, or to request Your data from Us. Form data will be available as exported comma separated variable (CSV) files and as PDF files. Uploaded data files will be available in their original format. After the thirty (30) day period, We have no obligation to maintain or provide data and may thereafter delete or destroy all copies of the Your data, unless legally prohibited. D. Vector CheckIT™. Customer Obligations. When purchasing Vector CheckIT™, You will identify stations, vehicles, drug safes, and other service specific details, as may be applicable. E. Vector LMS and Services which include access to the Shared Resource Feature. 36 Page 9 Public Sector SaaS Rev. U (Issued 02.02.2022) If You choose to participate by uploading Your information to the shared resource sections of our website, You hereby authorizes Us to share any intellectual property you own (“User Generated Content”) that Your Users upload to the shared resources section of our website with our third-party customers and users that are unrelated to you (“Our Other Customers”); provided that We must provide notice to Your users during the upload process that such User Generated Content will be shared with Our Other Customers. F. Casino Services. When purchasing Casino Services, in addition to the Responsibilities and Restrictions in Section 2 of the General Terms and Conditions above, the following shall apply to You: You must request Our written approval for third party access to the Services or content. Your request for third-party access shall include the third party’s names, company, and contact information. Upon Our request, You shall execute a written agreement with the third party, securing for Us the rights provided in this Section, Section 4 (Intellectual Property Rights), and Special Section 1 (Confidentiality) prior to providing access to Our Software, Services or Content under this Agreement. Use Restrictions. You shall not: (a) transmit or share the course content, with any persons other than authorized users (b) provide or otherwise make available the course content in whole or in part, in any form to any person without Our prior written consent; (c) transmit or share identification or password codes to persons other than authorized users (d) permit the identification or password codes to be cached in proxy servers, (e) permit access by individuals who are not authorized under this Agreement, or (f) permit access to the software through a single identification or password code being made available to multiple users on a network. The Parties have executed this Agreement by their authorized representatives as of the last date set forth below. TargetSolutions, LLC d/b/a Vector Solutions Orono Fire Department (MN) 4890 W. Kennedy Blvd., Suite 300 Tampa, FL 33609 2750 Kelley Parkway Long Lake, MN 55356 By: \ \s2\ By: \ \s1\ Printed Name: Anthony Colletti Printed Name: James Van Eyll Title: Director of Sales Title: Chief Date: \ \d2\ Date: \ \d1\ 37 Orono Fire Department (MN) We are excited to present pricing for the First Due Suite! Please see detailed breakdown below. It is important to note that First Due is a cloud-based system, and all Support, Maintenance, Hosting and Upgrades are ALWAYS INCLUDED. 107 Seventh St Garden City, NY 11530, United States First Due Quote Prepared By: Justin Kelly Valid Until: Quote Number: 1545132000142922625 First Due Modules and Implementation Services Included - Description Occupancy Management & Pre-Incident Planning Manage Occupancies, Pre-Incident Mapping, GIS data, Fire Systems, Hazardous Material, and Contacts. Responder Web Responder dashboard and Responder iOS/Android App with notifications, statusing and routing. Inspections Field Inspections, Configurable Checklists, Violation Management, Virtual Inspections, Inspections Scheduler, and Integrated Pre-Incident Planning. Community Connect Online portal for residents and businesses to input critical occupant and property data that can be made available to Emergency Response Agencies during an incident. Online Standard Training Package Includes a one-hour planning session and up to 12 hours of webinar train-the-trainer sessions Implementation and Configuration Services Services related to configuring and customizing the First Due Platform as described in the Statement of Work. One-Time Subtotal $ 750.00 Subscription Subtotal $ 5,500.00 Total Year 1 $ 6,250.00 Please do not share or reproduce without proper authorization | © First Due | www.firstdue.com 1 38 Item No.: 5 Date: January 22, 2024 Presenter: Correy Farniok Presenter: Police Chief Section:Consent Agenda Title: Authorization to Hire Stephen Thomas - Police Officer 1.Purpose: The purpose of this action item is to gain approval to hire a full-time Police Officer. 2.Recruitment: The selection process for the position involved advertising the position, application screening, and interviews. First round interviews are completed by a panel of currently serving officers and second round interviews by the Chief of Police. Police Officer applicant must also successfully complete a Psychological Exam, a Physical (Pre-employment medical) exam and has pass the MN Peace Officers Standards and Training (POST) licensing exam. 3.Recommended Candidate: Stephen Thomas is currently employed as a police officer for the South Lake Minnetonka Police Department since 2020. Thomas has a AAS in Law Enforcement from North Hennepin Community College. Thomas is excited about the opportunity to work for the Orono Police Deportment. 4.Recommended Compensation: I recommend to hire Stephen Thomas as a full-time police officer with the effective start date of January 23, 2024. Starting rate of $43.14/hour step 3 (LELS Local 40 Agreement pay scale). As a full-time employee the position is eligible for benefits as outlined in the LELS Local 40 Agreement and personnel handbook. This includes enrollment in the Police and Fire Plan of the Public Employee Retirement Association (PERA). AGENDA ITEM COUNCIL ACTION REQUESTED Motion to approve the hiring of Stephen Thomas as a full-time police officer at the rate of $43.14 per hour with a start date of January 23, 2024 39 Item No.: 6 Date: January 22, 2024 Presenter: Josh Lemons Presenter: Parks & Golf Course Superintendent Section:Consent Agenda Title: Golf Course Clubhouse Manager Part-time Status Change 1.Purpose: Approval to change the clubhouse manager from a part-time position to a full-time position. 2.Background: The clubhouse manager was hired in the Spring of 2022 as a part-time clubhouse manager and events coordinator for the city. The employee has performed at a high level and has been instrumental in adding to the success of the golf course over the last two years. Over the last two years, staff has seen the need to transition the part-time position to a full-time status. This has been an hourly position that is capped at 30 hours a week, which can be a hindrance to golf course operations in the golfing season. The HR Committee met on January 2, 2024 to discuss this along with several other topics. No objections were raised at the meeting regarding the position change. 3.Cost: The difference in pay will come out of the golf course operating budget. We have budgeted for another part-time position over the last two years, but have not been able to fill it. The budget has sufficient room to cover the additional 10 hours per week. The part-time position was already receiving benefits, this means that there will be no impact to changing to full-time. 4.Staff Recommendation: Staff recommends updating the part-time golf course manager position to a full-time position. The need for a full-time manager is clear and will allow for future improvements in operations at the Orono golf course. AGENDA ITEM COUNCIL ACTION REQUESTED Motion to approve full-time status for the clubhouse manager/events coordinator position. Exhibits Clubhouse Manager-Event Coordinator Position.pdf 40 CITY OF ORONO Position Title: Clubhouse Manager and Events Coordinator-Full Time Document Date: January 17, 2024 Department: Parks Department Accountable to: Parks and Golf Superintendent FLSA Status: Exempt Nature of Work Performs a variety of administrative and supervisory work in the management of the municipal golf course club house operation including but not limited to: managing and directing the day-to- day operations of the store; supervising and scheduling employees; developing retail objectives for the store; preparing marketing and merchandising concepts; establishing policies and procedures guaranteeing compliance with applicable laws and regulations; and maintaining proper store inventories. The position will also be responsible for planning, organizing, and facilitating events for the City of Orono. Golf course operation is seasonal in nature and the position may require additional hours during the golf season and fewer hours throughout the off- season. Supervision Received and Exercised This position is supervised by the Parks and Golf Superintendent. This position will provide supervision and oversight to the Orono Golf Course clubhouse employees. Examples of Work Essential functions listed below are intended as illustrations of the various types of work that may be performed. The omission of specific statements of duties does not exclude them if the work is similar, related or a logical assignment to the position. • Supervises the daily operation of the golf course clubhouse and staff. Work involves management of staff responsible for sale of greens fees, concessions including alcoholic beverages; assisting in the promotion and maintenance of good public relations and 41 customer satisfaction; assumes operational control as directed by the Golf Course Superintendent. • Works planning, organizing and coordinating special program and events throughout the city, determining program needs, maintaining liaisons and contacts, maintaining records and files, and related work as apparent or assigned. • Communicates with the general public in a professional manner and provide excellent customer service • Supervises the daily operations of the golf course clubhouse and staff • Assists in recruiting and training seasonal employees • Creates and manages schedules for staff • Orders, rotates, and manages concessions and alcohol • Generate sales reports • Maintains a variety of records relating to inspections and maintenance activity • Communicates with the superintendent to discuss conditions of facilities, maintenance plans, and scheduled events. • Performs or schedules routine cleaning and projects within golf course clubhouse • Performs other duties and assumes other responsibilities as assigned. • Researches and recommends opportunities for special events and community partnerships with outside organizations • Promote events through public media and flyers • Collaborates with City Council, Parks Commission, and Parks Superintendent for special events Required Knowledge, Skills and Abilities Knowledge: • Computer software, social media platforms, POS registers • Knowledge of Federal, State, and City laws and regulations related to food, beverage, and liquor sales • Understanding of basic accounting practices sufficient to manage a store budget • Public Safety and Security — Knowledge of relevant equipment, policies, procedures, and strategies to promote effective local, state, or national security operations for the protection of people, data, property, and institutions • English Language — Knowledge of the structure and content of the English language including the meaning and spelling of words, rules of composition, and grammar Skills: 42 • Developing marketing and advertising materials • Event planning methods and principles • Prioritizing, organizing, and managing multiple tasks • Active Listening — Give full attention to what other people are saying, taking time to understand the points being made, asking questions as appropriate, and not interrupting at inappropriate times • Monitoring — Monitor/Assess performance of yourself, other individuals, or organizations to make improvements or take corrective action • Speaking — Talk to others to convey information effectively • Coordination — Adjust actions in relation to others' actions • Time Management — Manage one's own time and the time of others • Critical Thinking — Use logic and reasoning to identify the strengths and weaknesses of alternative solutions, conclusions or approaches to problems Abilities: • Oral Comprehension — Able to listen to and understand information and ideas presented through spoken words and sentences • Oral Expression — Able to communicate information and ideas in speaking so others will understand • Problem Sensitivity — Able to tell when something is wrong or is likely to go wrong. It does not involve solving the problem, only recognizing there is a problem • Written Comprehension — Able to read and understand information and ideas presented in writing • Deductive Reasoning — Able to apply general rules to specific problems to produce answers that make sense Minimum Requirements • Associate’s degree in Business or a related field and/ or High School Diploma or Equivalency at least five years of previous retail experience with some background in bookkeeping and administrative work • Valid MN Class “D” Driver’s License. • Occasional lifting and carrying up to 50 pounds • Previous experience with a retail operation • Previous supervisory or management experience • Satisfactory results from drug test, physical examination, motor vehicle records check, and criminal background investigation Desirable Qualifications • Bachelor’s Degree in Recreation Studies, Economic Development, Business Administration, or a related field 43 • 3+ years of management and event planning Physical Demands and Working Environment The physical demands described here are representative of those that must be met by an employee to successfully perform the essential functions of this job. Reasonable accommodations may be made to enable individuals with disabilities to perform essential functions. While performing the duties of this job, the employee is regularly required to use hands to finger, handle, feel or operate objects, tools, or controls and reach with hands and arms. The employee frequently is required to stand and talk or hear. The employee is occasionally required to walk; sit; climb or balance; stoop, kneel, crouch, or crawl; and taste or smell. The employee must frequently lift and/or move up to 10 pounds and occasionally lift and/or move up to 50 pounds. Specific vision abilities required by this job include close vision, distance vision, color vision, peripheral vision, depth perception and the ability to adjust focus. The work environment characteristics described here are representative of those an employee encounters while performing the essential functions of this job. Reasonable accommodations may be made to enable individuals with disabilities to perform the essential functions. While performing the duties of this job, the employee occasionally works in outside weather conditions. The employee occasionally works near moving mechanical parts and is occasionally exposed to wet and/or humid conditions. The noise level in the work environment is moderately quiet. 44 Item No.: 7 Date: January 22, 2024 Presenter: DJ Goman Presenter: Public Works Superintendent Section:Consent Agenda Title: Approval to promote and hire Fleet Supervisor 1.Purpose: The purpose of this action item is to seek approval to hire a full-time Fleet Supervisor in the Public Works Department and to begin the process of recruiting the replacement vacancy of mechanic. 2.Background: The HR committee approved filling the position of the Fleet Supervisor at its January 2, 2024 meeting. Brody Pool, Public Works Mechanic, has expressed interest in the position. Brody has proven himself to be a valuable member of the organization as our mechanic. Staff would like to reward Brody with this promotional opportunity. 3.Recruitment: The selection process for the position has been completed. The process involved reviewing one application. One interview was conducted. 4.Recommended Candidate: Brody Pool is the recommended candidate for the Fleet Supervisor position. 5.Recommended Compensation: This position is subject the collective bargaining agreement with the International Union of Operating Engineers Local 49 grade 10 step 4 at $39.82. AGENDA ITEM COUNCIL ACTION REQUESTED Motion to approve promoting Brody Pool to the position of Fleet Supervisor at grade 10 step 4 of the Local 49 pay scale. 45 Item No.: 8 Date: January 22, 2024 Presenter: Maggie Jin Presenter: Finance Director Section:Presentations Title: 2022 Annual Comprehensive Financial Report Presentation 1.Purpose: The purpose of this item is to publicly present the 2022 audit and draft Annual Comprehensive Financial Report (ACFR) to the Council and public. 2.Background: Upon completion of the annual audit, the City’s auditors publicly present the results to the Mayor and Council. Tyler See from Abdo Solutions is here tonight to present the 2022 audit results. 3.Staff Recommendation: No action is required. This is an information item only. AGENDA ITEM COUNCIL ACTION REQUESTED No action is required. This is an information item only. Exhibits 2022 Annual Comprehensive Financial Report.pdf 2022 Executive Governance Summary.pdf 2022 Other Required Reports.pdf 46 ANNUAL COMPREHENSIVE FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2022 CITY OF ORONO, MINNESOTA 47 THIS PAGE IS LEFT BLANK INTENTIONALLY 48 CITY OF ORONO, MINNESOTA ANNUAL COMPREHENSIVE FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2022 REPORT PREPARED BY: FINANCE DEPARTMENT 49 THIS PAGE IS LEFT BLANK INTENTIONALLY 50 City of Orono, Minnesota Annual Comprehensive Financial Report Table of Contents For the Year Ended December 31, 2022 Page No. Introductory Section Organization Chart 10 Elected and Appointed Officials 11 Financial Section Independent Auditor’s Report 15 Management’s Discussion and Analysis 19 Basic Financial Statements Government-wide Financial Statements Statement of Net Position 35 Statement of Activities 36 Fund Financial Statements Governmental Funds Balance Sheet 40 Reconciliation of the Balance Sheet to the Statement of Net Position 43 Statement of Revenues, Expenditures and Changes in Fund Balances 44 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities 46 General Fund Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual 47 Proprietary Funds Statement of Net Position 48 Statement of Revenues, Expenses and Changes in Net Position 51 Statement of Cash Flows 52 Notes to the Financial Statements 55 Required Supplementary Information Schedule of Employer’s Share of Public Employees Retirement Association Net Pension Liability - General Employees Retirement Fund 86 Schedule of Employer’s Public Employees Retirement Association Contributions - General Employees Retirement Fund 86 Notes to the Required Supplementary Information - General Employee Retirement Fund 87 Schedule of Employer’s Share of Public Employees Retirement Association Net Pension Liability - Public Employees Police and Fire Fund 89 Schedule of Employer’s Public Employees Retirement Association Contributions - Public Employees Police and Fire Fund 89 Notes to the Required Supplementary Information - Public Employees Police and Fire Fund 90 Schedule of Changes in the City’s Total OPEB Liability and Related Ratios 92 5 51 THIS PAGE IS LEFT BLANK INTENTIONALLY 6 52 City of Orono, Minnesota Annual Comprehensive Financial Report Table of Contents (Continued) For the Year Ended December 31, 2022 Page No. Combining and Individual Fund Financial Statements and Schedules Nonmajor Governmental Funds Combining Balance Sheet 96 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 97 Nonmajor Special Revenue Funds Combining Balance Sheet 100 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 102 Nonmajor Debt Service Funds Combining Balance Sheet 106 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 107 Nonmajor Capital Projects Fund Combining Balance Sheet 110 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 112 Nonmajor Proprietary Funds Combining Statement of Net Position 116 Combining Statement of Revenues, Expenses and Changes in Net Position 117 Combining Statement of Cash Flows 118 General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual 119 Internal Service Funds Combining Statement of Net Position 122 Combining Statement of Revenues, Expenses and Changes in Net Position 123 Combining Statement of Cash Flows 124 Statistical Section (Unaudited) Financial Trends Summary Financial Report - Revenues and Expenditures for General Operations - Governmental Funds 129 Net Position by Component 130 Changes in Net Position 132 Fund Balances of Governmental Funds 136 Changes in Fund Balances of Governmental Funds 138 Revenue Capacity Assessed Value and Estimated Actual Value of Taxable Property 140 Property Tax Rates - Direct and Overlapping Governments 141 Principal Property Taxpayers 142 Property Tax Levies and Collections 143 Debt Capacity Ratios of Outstanding Debt by Type 144 Ratios of General Bonded Debt Outstanding 145 Direct and Overlapping Governmental Activities Debt 147 Legal Debt Margin Information 148 Pledged Revenue Coverage 150 Demographic and Economic Information Demographic and Economic Statistics 151 Principal Employers 153 Operating Information Full-Time Equivalent Employees by Function 154 Operating Indicators by Function 156 Capital Asset Statistics by Function 158 7 53 THIS PAGE IS LEFT BLANK INTENTIONALLY 8 54 INTRODUCTORY SECTION CITY OF ORONO, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2022 9 55 Public City Administrator Fire Building Inspections Legal Engineer Assessor Auditor Bond Counsel Financial Advisor Advisory Commissions City Clerk Management Assistant Municipal Services Support Rep Accountant Payroll/U.B. (.8 FTE) IT Technician Patrol Officers (21) PT Patrol Officers (3) CSO (1 FT, 1 PT) Police Office Manager Admin. Support Asst. (2) Reserve Officers Planning Commission Park Commission Police Advisory Commission Long Lake Fire Advisory Commission Hwy 12 Turnback Committee Public Works Director / City Engineer Community Development Director Police Chief Roads/Storm water Supervisor Sewer/Water Supervisor Maintenance Staff (7) Golf/Parks Supervisor Seasonal Clubhouse Manager Seasonal Staff Contracted Services Finance Director Patrol Sgt. (3) Investigative Sgt (1) Deputy Chief •Senior Planner •Building Official •City Planners •Planning Assistant Mayor & Council City of Orono Organizational Chart 10 56 City of Orono, Minnesota Elected and Appointed Officials For the Year Ended December 31, 2022 Name Title Term Expires Dennis Walsh Mayor 12/31/24 Richard Crosby II Council Member 12/31/24 Matt Johnson Council Member 12/31/26 Alisa Benson Council Member 12/31/26 Victoria Seals Council Member 12/31/24 Name Title Adam Edwards City Administrator Ronald Olson Finance Director - Treasurer ELECTED APPOINTED 11 57 THIS PAGE IS LEFT BLANK INTENTIONALLY 12 58 FINANCIAL SECTION CITY OF ORONO, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2022 13 59 THIS PAGE IS LEFT BLANK INTENTIONALLY 14 60 INDEPENDENT AUDITOR’S REPORT Honorable Mayor and City Council City of Orono, Minnesota Opinions 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, Minnesota (the City), as of and for the year ended December 31, 2022, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents. 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 as of December 31, 2022, and the respective changes in financial position and, where applicable, cash flows thereof and the respective budgetary comparison for the General fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinions 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. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Responsibilities of Management 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 the financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter. Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. 15 61 In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we: • Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. • Obtain an understanding of internal control relevant to the audit 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 City’s internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. • Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit. Change in Accounting Principle As described in Note 7 to the financial statements, the City adopted the provisions of Governmental Accounting Standard Board (GASB) Statement No. 87, Lease, for the year ended December 31, 2022. Adoption of the provisions of these statements results in significant change to the classifications of the components of the financial statements. Our opinion is not modified with respect to this matter. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the Management’s Discussion and Analysis starting on page 19 and the Schedules of Employer’s Share of the Net Pension Liability, the Schedules of Employer’s Contributions, the related notes disclosures and the Schedule of Changes in the City’s OPEB Liability and Related Ratios starting on page 86 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 st atements, 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. 16 62 Supplementary Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The combining and individual fund financial statements and schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual fund financial 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 audi t 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 combining and individual fund financial statements and schedules are fairly stated, in all material respects in relation to the basic financial statements as a whole. Other Information Management is responsible for the other information in the annual report. The other information comprises the introductory section and statistical section but does not include the basic financial statements and our auditor’s report thereon. Our opinions on the basic financial statement do not cover the other information, and we do not express an opinion or any form of assurance thereon. In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 19, 2023, on our consideration of the City’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 results of that testing, and not to provide an opinion on the effectiveness of the City’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 the City’s internal control over financial reporting and compliance. Abdo Minneapolis, Minnesota December 19, 2023 17 63 THIS PAGE IS LEFT BLANK INTENTIONALLY 18 64 Management’s Discussion and Analysis As management of the City of Orono, Minnesota, (the City), we offer readers of the City’s financial statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended December 31, 2022. Financial Highlights •The assets and deferred outflows or resources of the City exceeded its liabilities and deferred inflows of resources at the close of the most recent fiscal year as shown in the summary of net position on the following pages. The unrestricted amount of net position may be used to meet the City’s ongoing obligations to citizens and creditors. •The City’s total net position increased as shown in the summary of changes in net assets table on the following pages. The increase this year was due to an increase in operating grants and contributions, and charges for services in the business-type activities continuing to outweigh expenses. •For the current fiscal year, the City's governmental funds fund balances are shown in the Financial Analysis of the City's Funds section of the MD&A. The total fund balance increased in comparison with the prior year. This increase was mainly due to an increase in intergovernmental and tax revenues as well as transfers in from the water and sewer fund. The total of assigned and unassigned as shown in the governmental fund balance table is available for spending at the City’s discretion. •The unassigned fund balance in the General fund as shown in the financial analysis of the City’s funds section increased from prior year. •The City’s total bonded debt decreased during the fiscal year. The decrease was a result of schedule debt service payments as shown on the outstanding debt table. 19 65 Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements comprise three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplemental information in addition to the basic financial statements themselves. The following chart shows how the various parts of this annual report are arranged and related to one another: The financial statements also include notes that explain some of the information in the financial statements and provide more detailed data. The statements are followed by a section of combining and individual fund financial statements and schedules that further explains and supports the information in the financial statements. Figure 1 shows how the required parts of this annual report are arranged and relate to one another. In addition to these required elements, we have included a section with combining and individual fund financial statements and schedules that provide details about nonmajor governmental funds, which are added together and presented in single columns in the basic financial statements. Internal service funds statements are also included, reflecting balances prior to their elimination from the government-wide financial statements, to avoid “doubling-up” effect within the governmental and business-type activities columns of said statements. Figure 1 Required Components of the City’s Annual Financial Report Management's Discussion and Analysis Basic Financial Statements Required Supplementary Information Government- wide Financial Statements Fund Financial Statements Notes to the Financial Statements Summary Detail 20 66 Figure 2 summarizes the major features of the City’s financial statements, including the portion of the City government they cover and the types of information they contain. The remainder of this overview section of management’s discussion and analysis explains the structure and contents of each of the statements. Figure 2 Major Features of the Government-wide and Fund Financial Statements Fund Financial Statements Government-wide Statements Governmental Funds Proprietary Funds Scope Entire City government and the City’s component units The activities of the City that are not proprietary or fiduciary, such as police, fire and parks Activities the City operates similar to private businesses, such as the water and sewer system Required financial statements • Statement of Net Position • Statement of Activities • Balance Sheet • Statement of Revenues, Expenditures, and Changes in Fund Balances • Statements of Net Position • Statements of Revenues, Expenses and Changes in Fund Net Position • Statements of Cash Flows Accounting basis and measurement focus Accrual accounting and economic resources focus Modified accrual accounting and current financial resources focus Accrual accounting and economic resources focus Type of asset/liability information All assets and liabilities, both financial and capital, and short-term and long- term Only assets expected to be used up and liabilities that come due during the year or soon thereafter; no capital assets included All assets and liabilities, both financial and capital, and short-term and long- term Type of deferred outflows/inflows of resources information All deferred outflows/inflows of resources, regardless of when cash is received or paid Only deferred outflows of resources expected to be used up and deferred inflows or resources that come due during the year or soon thereafter; no capital assets included All deferred outflows/inflows of resources, regardless of when cash is received or paid Type of inflow/out flow information All revenues and expenses during year, regardless of when cash is received or paid Revenues for which cash is received during or soon after the end of the year; expenditures when goods or services have been received and payment is due during the year or soon thereafter All revenues and expenses during the year, regardless of when cash is received or paid 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 a private-sector business. The statement of net position presents information on all of the City’s assets, deferred outflows, liabilities, and deferred inflows, with the difference reported as net position. Over time, increases or decreases 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 in 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., uncollected taxes and earned but unused vacation leave). 21 67 Both of the government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenue (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 of the City include general government, public safety, public works, culture and recreation, community development, and interest on long-term debt. The business-type activities of the City include water and sewer utilities and the golf course. The government-wide financial statements start on page 35 of this report. 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. All of the funds of the City can be divided into three categories: governmental funds, proprietary funds , and fiduciary funds. Governmental Funds. Governmental funds are used to account for essentially the same functions reported 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 on 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 by the government’s near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. The City maintains numerous individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures and changes in fund balances for the General fund, Municipal State Aid Street fund, Pavement Management Plan and Project Construction funds which are all considered to be major funds. Data from the other 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 or schedules elsewhere in this report. The City adopts an annual appropriated budget for its General fund. A budgetary comparison statement has been provided for these funds to demonstrate compliance with its budget. The basic governmental fund financial statements start on page 40 of this report. Proprietary Funds. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for all the water, sewer, and golf course funds, which are considered to be major funds of the City. Conversely, all internal service funds are combined into a single aggregated presentation in the proprietary fund financial statements. Individual fund data for the internal service funds is provided in the form of combining statements elsewhere in this report. The City maintains two different 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 City uses enterprise funds to account for its water, sanitary sewer and golf operations. Internal service funds are an accounting device used to accumulate and allocate costs internally among the City's various functions. The City uses internal service funds to account for insurance, compensated absences, fleet management and IT services. Because these services benefit both governmental and business-type activities, they are allocated to both governmental and business-type activities in the government-wide financial statements. The basic proprietary fund financial statements start on page 48 of this report. Notes to the Financial Statements. The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements start on page 55 of this report. 22 68 Other Information. In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning the City’s progress in funding its obligation to provide pensions and other postemployment benefits to its employees. Required supplementary information can be found starting on page 86 of this report. The combining statements referred to earlier in connection with nonmajor governmental funds and internal service funds are presented following the required supplementary information. Combining and individual fund financial statements and schedules start on page 96 of this report. Supplementary Information. In addition to the basic financial statements and accompanying notes, this report also presents required supplementary information concerning the City’s progress in funding its obligation to provide pension benefits and other post-employment benefits to its employees. Required supplementary information can be found on page 86 of this report. The combining statements referred to earlier in connection with nonmajor governmental funds and internal service funds are presented following the notes to the financial statements. Combining and individual fund financial statements and schedules start on page 96 of this report. Government-wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. In the case of the City, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources at the close of the most recent fiscal year. By far, the largest portion of the City’s net position reflects its investment in capital assets (e.g., land, buildings, machinery and equipment) less any related debt used to acquire those assets that is still outstanding. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. 23 69 City of Orono’s Summary of Net Position Increase Increase 2022 2021 (Decrease)2022 2021 (Decrease) Assets Current and other assets 26,526,906$ 26,013,907$ 512,999$ 7,623,357$ 6,822,206$ 801,151$ Capital assets, net of depreciation 36,349,163 35,089,693 1,259,470 21,036,145 20,139,433 896,712 Total Assets 62,876,069 61,103,600 1,772,469 28,659,502 26,961,639 1,697,863 Deferred Outflows of Resources Deferred other postemployment benefits resources - 129,109 (129,109) - 23,403 (23,403) Deferred pension resources 7,469,420 3,786,052 3,683,368 185,284 192,938 (7,654) Total Deferred Outflows or Resources 7,469,420 3,915,161 3,554,259 185,284 216,341 (31,057) Liabilities Noncurrent liabilities outstanding 31,599,197 23,169,933 8,429,264 1,415,029 1,212,714 202,315 Other liabilities 2,735,733 2,647,795 87,938 701,304 409,502 291,802 Total Liabilities 34,334,930 25,817,728 8,517,202 2,116,333 1,622,216 494,117 Deferred Inflows of Resources Deferred lease resources 729,978 - 729,978 - - - Deferred other postemployment benefits resources - 149,243 (149,243) - 27,053 (27,053) Deferred pension resources 229,236 5,090,758 (4,861,522) 153 250,440 (250,287) Total Deferred Inflows or Resources 959,214 5,240,001 (4,280,787) 153 277,493 (277,340) Net Position Net investment in capital assets 33,174,764 31,430,458 1,744,306 20,387,984 19,404,787 983,197 Restricted 2,704,755 3,075,294 (370,539) - - - Unrestricted (828,174) (544,720) (283,454) 6,340,316 5,873,484 466,832 Total Net Position 35,051,345$ 33,961,032$ 1,090,313$ 26,728,300$ 25,278,271$ 1,450,029$ Net Position as a Percent of Total Net Investment in Capital Assets 94.6%92.5%76.3%76.8% Restricted 7.7%9.1%0.0%0.0% Unrestricted -2.4%-1.6%23.7%23.2% 100.0%100.0%100.0%100.0% Governmental Activities Business-type Activities An additional portion of the City’s net position represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net position may be used to meet the City’s ongoing obligations to citizens and creditors. At the end of the current fiscal year, the City is able to report positive balances in the net investment in capital asset and restricted categories. The same situation held true for the prior fiscal year. 24 70 Significant changes from the prior year are noted below: City of Orono’s Changes in Net Position Increase Increase 2022 2021 (Decrease)2022 2021 (Decrease) Revenues Program Revenues Charges for services 5,179,441$ 5,049,369$ 130,072$ 5,175,861$ 4,873,537$ 302,324$ Operating grants and contributions 493,022 550,474 (57,452) 468,486 15,982 452,504 Capital grants and contributions 763,475 273,445 490,030 44,627 364,815 (320,188) General Revenues Taxes Property taxes 6,779,524 6,551,553 227,971 - - - Tax increment 187,356 145,895 41,461 - - - Grants and contributions not restricted to specific programs 16,817 1,784 15,033 - - - Unrestricted investment earnings (loss)(287,466) (6,927) (280,539) (244,980) (17,927) (227,053) Gain on sale of capital assets 2,940 48,388 (45,448) - - - Total Revenues 13,135,109 12,613,981 521,128 5,443,994 5,236,407 207,587 Expenses General government 2,028,478 1,572,281 456,197 - - - Public safety 6,607,975 5,445,046 1,162,929 - - - Public works 2,084,036 1,705,585 378,451 - - - Culture and recreation 832,389 731,394 100,995 - - - Community development 46,406 59,265 (12,859) - - - Interest on long-term debt 543,012 359,970 183,042 - - - Water - - - 1,170,772 1,110,702 60,070 Sewer - - - 1,974,089 1,676,642 297,447 Storm water - - - 443,573 310,626 132,947 Recycling - - - 244,021 232,165 11,856 Cable television - - - 64,010 100,970 (36,960) Total Expenses 12,142,296 9,873,541 2,268,755 3,896,465 3,431,105 465,360 Change in Net Position before Transfers 992,813 2,740,440 (1,747,627) 1,547,529 1,805,302 (257,773) Transfers (Net)97,500 212,500 (115,000) (97,500) (212,500) 115,000 Change in Net Position 1,090,313 2,952,940 (1,862,627) 1,450,029 1,592,802 (142,773) Net Position, January 1 33,961,032 31,008,092 2,952,940 25,278,271 23,685,469 1,592,802 Net Position, December 31 35,051,345$ 33,961,032$ 1,090,313$ 26,728,300$ 25,278,271$ 1,450,029$ Governmental Activities Business-type Activities • The increase in Program Revenues from the prior year relates to capital grants and contributions. Capital grants and contributions increased due to increased municipal state aid. • The increase in Public Safety expenses from prior year is expenses is due to an increase in police and fire expenses. • The increase in Public Works expense from prior year is due to various street construction projects during the year. 25 71 Governmental Activities. Governmental activities increased the City’s net position. This increase was primarily the result of current year increase in revenues and change in pension liability balances. The following graph depicts various governmental activities and shows the revenues and expenses directly related to those activities. Expenses and Program Revenues - Governmental Activities $- $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 General Government Public Safety Public Works Parks and Recreation Community Development Interest on Long- term Debt Expenses Program Revenues Revenues by Source - Governmental Activities Charges for Services 39.50% Operating Grants and Contributions 3.80% Capital Grants and Contributions 5.80% Grants and Contributions Unrestricted 0.10% Taxes 53.00% Other -2.20% 26 72 Business-type Activities. Business-type activities increased the City’s net position, as shown in the changes in net position table. • Charges for services for business-type activities increased due to an increase in water, sewer, and stormwater sales. • Operating grants and contributions for business-type activities increased due to an increase in federal grants in the Water Fund. • Total expenses for business-type activities increased due to an increase in personnel services for both the Water and Sewer Fund and an increase in MCES (Metropolitan Council Environmental Services) expenses in the Sewer Fund. Expenses and Program Revenues - Business-type Activities $- $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 Water Sewer Storm Water Recycling Cable Television Expenses Program Revenues Revenues by Source - Business-type Activities Charges for Services 93.30% Capital Grants and Contributions 0.8% Unrestricted Investment Earnings (Loss) -4.5% 27 73 Financial Analysis of the City’s Funds As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance -related legal requirements. Governmental Funds. The focus of the City’s governmental funds is to provide information on near-term inflows, outflows and balances of spendable resources. Such information is useful in assessing the City’s financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year. The table below outlines the governmental fund balances for the year ending December 31, 2022: Municipal Internal Other General State Aid Service Governmental Prior Year Increase/ Fund Street Funds Funds Total Total (Decrease) Fund Balances Nonspendable 33,771$ -$ -$ -$ -$ -$ 33,771$ 40,670$ (6,899)$ Restricted - - - 15,151,607 - 2,894,409 18,046,016 18,561,508 (515,492) Committed - - - - - 64,885 64,885 38,712 26,173 Assigned - - - 700,600 - 2,516,883 3,217,483 3,245,236 (27,753) Unassigned 5,219,544 (1,507,050) (1,117,246) - 495,413 (1,464,359) 1,626,302 994,985 631,317 5,253,315$ (1,507,050)$ (1,117,246)$ 15,852,207$ 495,413$ 4,011,818$ 22,988,457$ 22,881,111$ 107,346$ Pavement Management Plan Project Construction Fund As of the close of the current fiscal year, the City’s governmental funds reported combined ending fund balances shown above. Additional information on the City’s fund balances can be found in Note 1 starting on page 63 of this report. The General fund is the chief operating fund of the City. At the end of the current year, the fund balance of the General fund is shown in the table above. As a measure of the General fund’s liquidity, it may be useful to compare unassigned fund balance to total fund expenditures. The total unassigned fund balance as a percent of total fund expenditures is shown in the chart below along with total fund balance as a percent of total expenditures. Current Year Prior Year Increase/ Ending Balance Ending Balance (Decrease) General Fund Fund Balances Nonspendable 33,771$ 40,670$ (6,899)$ Unassigned 5,219,544 4,617,503 602,041 5,253,315$ 4,658,173$ 595,142$ General Fund expenditures 9,278,482$ 8,905,599$ Unassigned as a percent of expenditures 56.3%51.8% Total Fund Balance as a percent of expenditures 56.6%52.3% The fund balance of the City’s General fund increased during the current fiscal year as shown in the table above. The increase in fund balance was due to an increase in charges for services. 28 74 Other major governmental fund analysis is shown below: Increase 2022 2021 (Decrease) Municipal State Aid Street (1,507,050)$ (1,813,502)$ 306,452$ Pavement Management Plan (1,117,246)$ (774,042)$ (343,204)$ Project Construction 15,852,207$ 15,778,512$ 73,695$ The Pavement Management Plan fund collects and allocates resources related to the repair and maintenance of roads within the City. The decrease in fund balance is due to repair and maintenance costs exceeding levied property taxes. The Project Construction Fund is used to collect and spend resources related to various construction projects within the City. The increase is due to levied property tax revenues exceeding current year project costs. Fund Balances Major Fund December 31, The Municipal State Aid Street fund is used to collect and spend resources on the various projects related to state aid streets and highways. The increase in fund balance is mainly due to a no expenditures in the current year. Proprietary Funds. The City’s proprietary funds provide the same type of information found in the government -wide financial statements, but in more detail. Net position of the City’s major proprietary funds increased or (decreased) as follows: Ending Ending Net Position Net Position Increase/ 2022 2021 (Decrease) Water 6,055,984$ 4,996,693$ 1,059,291$ The increase primarily is attributed to operating revenues exceeding expenses. Sewer 15,755,967 15,605,668 150,299 The increase primarily is attributed to operating revenues exceeding expenses. Storm Water 4,556,859 4,319,310 237,549 The increase primarily is attributed to operating revenues exceeding expenses. 29 75 General Fund Budgetary Highlights Original Final Budgeted Budgeted Actual Variance with Amounts Amounts Amounts Final Budget Revenues 9,955,596$ 9,955,596$ 10,170,684$ 215,088$ Expenditures 9,575,596 9,575,596 9,278,482 297,114 Excess of Revenues Over Expenditures 380,000 380,000 892,202 512,202 Other Financing Sources (Uses) Proceeds from sale of capital assets 20,000 20,000 2,940 (17,060) Transfers out (400,000) (400,000) (300,000) 100,000 Total Other Financing Sources (Uses)(380,000) (380,000) (297,060) 82,940 Net Change in Fund Balances - - 595,142 595,142 Fund Balances, January 1 4,658,173 4,658,173 4,658,173 Fund Balances, December 31 4,658,173$ 4,658,173$ 5,253,315$ 595,142$ The City’s General fund budget was not amended during the year as shown above. Actual revenues were over the final budget and expenditures were under the final budget amounts as shown above. Capital Asset and Debt Administration Capital Assets. The City’s investment in capital assets for its governmental and business-type activities as of December 31, 2022, is shown below in capital asset table (net of accumulated depreciation). This investment in capital assets includes land, structures, improvements, machinery and equipment, vehicles, roads, highways and bridges. Major capital asset events during the current fiscal year included the following: • The East Long Lake Road and Concept Development Project was completed • Substantial work was completed on the 2021 Street Improvement Project and on the CSAH 112 18 -043 Street Project. • 2022 Street improvement Project was started. • Various Public Safety capital equipment and vehicle projects. • The Watermain Replacement (CSAH 19) Project was started. • The City also had various sewer and drainage improvements completed in 2022. 30 76 City of Orono’s Capital Assets (Net of Depreciation) Additional information on the City’s capital assets can be found in Note 3B starting on page 65 of this report. Increase Increase Increase 2022 2021 (Decrease)2022 2021 (Decrease)2022 2021 (Decrease) Land 7,677,435$ 7,677,435$ -$ 86,074$ 86,074$ -$ 7,763,509$ 7,763,509$ -$ Construction in Progress 3,383,190 2,106,260 1,276,930 1,178,176 245,058 933,118 4,561,366 2,351,318 2,210,048.00 Infrastructure 13,247,716 13,243,725 3,991 936,628 18,245,506 (17,308,878) 14,184,344 31,489,231 (17,304,887.00) Buildings and Systems 7,383,614 7,570,954 (187,340) (519) 1,007,169 (1,007,688) 7,383,095 8,578,123 (1,195,028.00) Improvements other than Buildings 1,981,263 2,081,191 (99,928) 493,656 (266) 493,922 2,474,919 2,080,925 393,994.00 Machinery and Equipment 2,675,945 2,410,128 265,817 18,342,130 555,892 17,786,238 21,018,075 2,966,020 18,052,055.00 Total 36,349,163$ 35,089,693$ 1,259,470$ 21,036,145$ 20,139,433$ 896,712$ 57,385,308$ 55,229,126$ 2,156,182$ Percent increase (decrease)3.6%4.5%3.9% Governmental Activities Business-type Activities Total Long-term Debt. At the end of the current fiscal year, the City had total bonded debt outstanding consisting of revenue related debt and general obligation debt as noted in the table below. While all of the City’s bonds have revenue streams, they are all backed by the full faith and credit of the City. State statutes limit the amount of G.O. debt a Minnesota city may issue to 3 percent of total estimated market value. The current debt limitation for the City is $107,592,654 Only the $18,290,000 in G.O. bonds is counted within the statutory limitation. City of Orono’s Outstanding Debt Increase Increase 2022 2021 (Decrease)2022 2021 (Decrease) G.O. Revenue Bonds 17,650,000$ 18,385,000$ (735,000)$ 640,000$ 725,000$ (85,000)$ Bond Premium 676,006 745,963 (69,957) 9,646 11,131 (1,485) Total 18,326,006$ 19,130,963$ (804,957)$ 649,646$ 736,131$ (86,485)$ Governmental Activities Business-type Activities Additional information on the City’s long-term debt can be found in Note 3D starting on page 69 of this report. Economic Factors and Next Year’s Budgets and Rates • Utility rate increases are scheduled to be around 2% per year. These sustainable increases were made possible by analyzing the utility funds capital needs and making the difficult decision to increase rates significantly over the past three years. • Property values continue to rise, but at a much lower rate than in previous years. With indications that interest rates may remain at relatively high levels through next year, it is unlikely that the property tax base will expand as dramatically as it has over the last three years. • The creation and equipping of the Orono Fire Department has resulted in short term spike in capital expenditures that will last for a couple of years. The new equipment is being worked into the City’s Capital Improvement Plan so that large spikes in capital expenditures can be avoided in the future. 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, Orono, Minnesota 55356 or by calling (952) 249-4600. 31 77 THIS PAGE IS LEFT BLANK INTENTIONALLY 32 78 GOVERNMENT-WIDE FINANCIAL STATEMENTS CITY OF ORONO, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2022 33 79 THIS PAGE IS LEFT BLANK INTENTIONALLY 34 80 City of Orono, Minnesota Statement of Net Position December 31, 2022 Governmental Business-type Activities Activities Total Assets Cash and temporary investments 25,168,886$ 6,999,926$ 32,168,812$ Receivables Accrued interest 25,930 19,877 45,807 Taxes 66,614 - 66,614 Accounts 11,450 352,805 364,255 Special assessments - 186,179 186,179 Lease 735,229 - 735,229 Due from other governments 465,784 654 466,438 Prepaid items 53,013 63,916 116,929 Capital assets Land and construction in progress 11,060,625 1,264,250 12,324,875 Depreciable assets (net of accumulated depreciation)25,288,538 19,771,895 45,060,433 Total Assets 62,876,069 28,659,502 91,535,571 Deferred Outflows of Resources Deferred pension resources 7,469,420 185,284 7,654,704 Liabilities Accounts and contracts payable 144,673 652,856 797,529 Accrued salaries payable 108,195 10,536 118,731 Due to other governments 179,791 24,107 203,898 Accrued interest payable 189,654 6,805 196,459 Deposits payable 1,606,388 7,000 1,613,388 Unearned revenue 507,032 - 507,032 Noncurrent liabilities Due within one year Long-term liabilities 1,720,805 128,856 1,849,661 Due in more than one year Long-term liabilities 17,235,332 566,977 17,802,309 Net pension liability 11,564,871 556,385 12,121,256 Other postemployment benefits liability 1,078,189 162,811 1,241,000 Total Liabilities 34,334,930 2,116,333 36,451,263 Deferred Inflows of Resources Deferred lease resources 729,978 - 729,978 Deferred pension resources 229,236 153 229,389 Total Deferred Inflows of Resources 959,214 153 959,367 Net Position Net investment in capital assets 33,174,764 20,387,984 53,562,748 Restricted for Debt service 1,317,176 - 1,317,176 Golf course improvements - - - Park improvements 92,602 - 92,602 Drug and alcohol law enforcement 558,680 - 558,680 Home buyer purchase assistance program 134,830 - 134,830 Housing 601,467 - 601,467 Unrestricted (828,174) 6,340,316 5,512,142 Total Net Position 35,051,345$ 26,728,300$ 61,779,645$ The notes to the financial statements are an integral part of this statement. 35 81 City of Orono, Minnesota Statement of Activities For the Year Ended December 31, 2022 Operating Capital Charges for Grants and Grants and Expenses Services Contributions Contributions Governmental Activities General government 2,028,478$ 1,168,166$ -$ -$ Public safety 6,607,975 2,772,525 493,022 - Public works 2,084,036 1,118,347 - 740,792 Parks and recreation 832,389 120,403 - 22,683 Community development 46,406 - - - Interest on long-term debt 543,012 - - - Total Governmental Activities 12,142,296 5,179,441 493,022 763,475 Business-type Activities Water 1,170,772 1,818,457 460,000 9,600 Sewer 1,974,089 2,294,626 - 18,908 Storm water 443,573 741,332 - 16,119 Recycling 244,021 248,455 8,486 - Cable television 64,010 72,991 - - Total Business-type Activities 3,896,465 5,175,861 468,486 44,627 Total 16,038,761$ 10,355,302$ 961,508$ 808,102$ General Revenues Taxes Property taxes, levied for general purposes Property taxes, levied for debt service Tax increments Grants and contributions not restricted to specific programs Unrestricted investment earnings (loss) Gain on sale of capital assets Transfers - Internal Activities Total General Revenues and Transfers Change in Net Position Net Position, January 1 Net Position, December 31 Functions/Programs Program Revenues The notes to the financial statements are an integral part of this statement. 36 82 Governmental Business-type Activities Activities Total (860,312)$ -$ (860,312)$ (3,342,428) - (3,342,428) (224,897) - (224,897) (689,303) - (689,303) (46,406) - (46,406) (543,012) - (543,012) (5,706,358) - (5,706,358) - 1,117,285 1,117,285 - 339,445 339,445 - 313,878 313,878 - 12,920 12,920 - 8,981 8,981 - 1,792,509 1,792,509 (5,706,358) 1,792,509 (3,913,849) 6,198,881 - 6,198,881 580,643 - 580,643 187,356 - 187,356 16,817 - 16,817 (287,466) (244,980) (532,446) 2,940 - 2,940 97,500 (97,500) - 6,796,671 (342,480) 6,454,191 1,090,313 1,450,029 2,540,342 33,961,032 25,278,271 59,239,303 35,051,345$ 26,728,300$ 61,779,645$ Changes in Net Position Net (Expenses) Revenues and The notes to the financial statements are an integral part of this statement. 37 83 THIS PAGE IS LEFT BLANK INTENTIONALLY 38 84 FUND FINANCIAL STATEMENTS CITY OF ORONO, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2022 39 85 City of Orono, Minnesota Balance Sheet Governmental Funds December 31, 2022 Municipal Pavement State Aid Management General Street Plan Assets Cash and temporary investments 4,705,413$ (2,764)$ 209,223$ Receivables Accrued interest 9,473 - - Taxes 66,614 - - Accounts 11,448 - - Lease - - 735,229 Due from other governments 140,985 293,233 10,191 Due from other funds 2,755,491 - - Prepaid items 33,771 - - Total Assets 7,723,195$ 290,469$ 954,643$ Liabilities Accounts and contracts payable 27,930$ -$ 66,328$ Accrued salaries payable 106,503 - - Due to other governments 179,791 - - Due to other funds - 1,504,286 1,251,205 Deposits payable 1,606,388 - - Unearned revenue 482,654 - 24,378 Total Liabilities 2,403,266 1,504,286 1,341,911 Deferred Inflows of Resources Deferred lease resources - - 729,978 Unavailable revenues - delinquent taxes 66,614 - - Unavailable revenues - intergovernmental - 293,233 - Total Deferred Inflows of Resources 66,614 293,233 729,978 Fund Balances Nonspendable 33,771 - - Restricted - - - Committed - - - Assigned - - - Unassigned 5,219,544 (1,507,050) (1,117,246) Total Fund Balances 5,253,315 (1,507,050) (1,117,246) Total Liabilities, Deferred Inflows of Resources and Fund Balances 7,723,195$ 290,469$ 954,643$ The notes to the financial statements are an integral part of this statement. 40 86 Project Other Total Construction Governmental Governmental Fund Funds Funds 15,842,982$ 4,008,729$ 24,763,583$ - 13,622 23,095 - - 66,614 - - 11,448 - - 735,229 9,225 12,150 465,784 - 601,467 3,356,958 - - 33,771 15,852,207$ 4,635,968$ 29,456,482$ -$ 22,683$ 116,941$ - - 106,503 - - 179,791 - 601,467 3,356,958 - - 1,606,388 - - 507,032 - 624,150 5,873,613 - - 729,978 - - 66,614 - - 293,233 - - 1,089,825 - - 33,771 15,151,607 2,894,409 18,046,016 - 64,885 64,885 700,600 2,516,883 3,217,483 - (1,464,359) 1,130,889 15,852,207 4,011,818 22,493,044 15,852,207$ 4,635,968$ 29,456,482$ The notes to the financial statements are an integral part of this statement. 41 87 THIS PAGE IS LEFT BLANK INTENTIONALLY 42 88 City of Orono, Minnesota Reconciliation of the Balance Sheet to the Statement of Net Position Governmental Funds December 31, 2022 Amounts reported for the governmental activities in the statement of net position are different because Total Fund Balances - Governmental Funds 22,493,044$ Capital assets used in governmental activities are not financial resources and therefore are not reported as assets in governmental funds. Cost of capital assets 47,846,582 Less: accumulated depreciation (11,497,419) Internal service funds are used by the City to charge the cost of compensated absences, liability, property, and workers compensation insurance, vehicles and equipment, centralized purchase of consumable office supplies, maintaining facilities, and maintenance of computer systems. These balances are reported with governmental activities on the statement of net position.397,958 Noncurrent liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported as liabilities in the funds. Noncurrent liabilities at year-end consist of Compensated absences payable (630,131) Bonds payable (17,650,000) Plus premium on bonds issued (676,006) Other postemployment benefits payable (1,078,189) Net pension liability (11,564,871) Some receivables are not available soon enough to pay for the current period's expenditures, and therefore are unavailable in the funds. Delinquent taxes 66,614 Intergovernmental 293,233 Governmental funds do not report long-term amounts related to pensions and OPEB. Deferred outflows of pension resources 7,469,420 Deferred inflows of pension resources (229,236) Governmental funds do not report a liability for accrued interest until due and payable.(189,654) Total Net Position - Governmental Activities 35,051,345$ The notes to the financial statements are an integral part of this statement. 43 89 City of Orono, Minnesota Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds For the Year Ended December 31, 2022 Municipal Pavement State Aid Management General Street Plan Revenues Taxes 4,971,706$ -$ 899,999$ Special assessments - - - Licenses and permits 727,426 - - Intergovernmental 509,839 319,390 - Charges for services 3,953,503 - 141,798 Fines and forfeitures 69,239 - - Investment earnings (loss)(86,726) (12,938) 5,251 Miscellaneous 25,697 - - Total Revenues 10,170,684 306,452 1,047,048 Expenditures Current General government 1,406,879 - - Public safety 6,095,829 - - Public works 922,394 - - Parks and recreation 662,240 - - Community development - - - Capital outlay Public safety 191,140 - Public works - - 1,390,252 Parks and recreation - - - Debt service Principal - - - Interest and other charges - - - Total Expenditures 9,278,482 - 1,390,252 Excess (Deficiency) of Revenues Over (Under) Expenditures 892,202 306,452 (343,204) Other Financing Sources (Uses) Transfers in - - - Proceeds from sale of capital assets 2,940 - - Transfers out (300,000) - - Total Other Financing Sources (Uses)(297,060) - - Net Change in Fund Balances 595,142 306,452 (343,204) Fund Balances, January 1 4,658,173 (1,813,502) (774,042) Fund Balances, December 31 5,253,315$ (1,507,050)$ (1,117,246)$ The notes to the financial statements are an integral part of this statement. 44 90 Project Other Total Construction Governmental Governmental Fund Funds Funds 374,999$ 767,999$ 7,014,703$ - 24,446 24,446 - 7,417 734,843 - 646,090 1,475,319 - 26,173 4,121,474 - 14,502 83,741 (192,705) (287,118) - 103,155 128,852 374,999 1,397,077 13,296,260 - - 1,406,879 - 589 6,096,418 - - 922,394 - 62,041 724,281 - 46,406 46,406 - - 191,140 301,304 588,254 2,279,810 - 62,880 62,880 - 735,000 735,000 - 460,111 460,111 301,304 1,955,281 12,925,319 73,695 (558,204) 370,941 - 397,500 397,500 - - 2,940 - - (300,000) - 397,500 100,440 73,695 (160,704) 471,381 15,778,512 4,172,522 22,021,663 15,852,207$ 4,011,818$ 22,493,044$ The notes to the financial statements are an integral part of this statement. 45 91 City of Orono, Minnesota Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities Governmental Funds For the Year Ended December 31, 2022 Amounts reported for governmental activities in the statement of activities are different because Total Net Change in Fund Balances - Governmental Funds 471,381$ Capital outlays are reported in governmental funds as expenditures. However, in the statement of activities, the cost of those assets is allocated over the estimated useful lives as depreciation expense. Capital outlays 2,365,356 Depreciation expense (1,105,886) The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and similar items when debt is first issued, whereas these amounts are amortized in the statement of activities. Principal repayments 735,000 Current year amortization of deferred charges 69,868 Interest on long-term debt in the statement of activities differs from the amount reported in the governmental fund because interest is recognized as an expenditure in the funds when it is due, and thus requires the use of current financial resources. In the statement of activities, however, interest expense is recognized as the interest accrues, regardless of when it is due.(152,769) Internal service funds are used by the City to charge the cost of compensated absences, liability, property, and workers compensation insurance, vehicles and equipment, centralized purchase of consumable office supplies, maintaining facilities, and maintenance of computer systems. These balances are reported with governmental activities in the statement of activities.(349,297) Certain revenues are recognized as soon as they are earned. Under the modified accrual basis of accounting, certain revenues cannot be recognized until they are available to liquidate liabilities of the current period. Special assessments (24,017) Property taxes (47,823) Intergovernmental (202,392) Some expenses reported in the statement of activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. Compensated absences (1,227) Other postemployment benefits (163,427) Long-term pension activity is not reported in governmental funds. Pension expense (614,943) Pension revenue from State contributions 110,489 Change in Net Position - Governmental Activities 1,090,313$ The notes to the financial statements are an integral part of this statement. 46 92 City of Orono, Minnesota Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual General Fund For the Year Ended December 31, 2022 Actual Variance with Original Final Amounts Final Budget Revenues Taxes 5,013,596$ 5,013,596$ 4,971,706$ (41,890)$ Licenses and permits 585,200 585,200 727,426 142,226 Intergovernmental 403,000 403,000 509,839 106,839 Charges for services 3,780,200 3,780,200 3,953,503 173,303 Fines and forfeitures 75,000 75,000 69,239 (5,761) Investment earnings (loss)80,500 80,500 (86,726) (167,226) Miscellaneous Rents and refunds 5,400 5,400 4,950 (450) Other 12,700 12,700 20,747 8,047 Total Revenues 9,955,596 9,955,596 10,170,684 215,088 Expenditures Current General government 1,504,320 1,504,320 1,406,879 97,441 Public safety 6,204,866 6,204,866 6,095,829 109,037 Public Works 1,002,800 1,002,800 922,394 80,406 Parks and recreation 678,610 678,610 662,240 16,370 Capital outlay Public safety 185,000 185,000 191,140 (6,140) Total Expenditures 9,575,596 9,575,596 9,278,482 297,114 Excess of Revenues Over Expenditures 380,000 380,000 892,202 512,202 Other Financing Sources (Uses) Proceeds from sale of capital assets 20,000 20,000 2,940 (17,060) Transfers out (400,000) (400,000) (300,000) 100,000 Total Financing Sources (Uses)(380,000) (380,000) (297,060) 82,940 Net Change in Fund Balances - - 595,142 595,142 Fund Balances, January 1 4,658,173 4,658,173 4,658,173 - Fund Balances, December 31 4,658,173$ 4,658,173$ 5,253,315$ 595,142$ Budgeted Amounts The notes to the financial statements are an integral part of this statement. 47 93 Governmental Activities - Internal Water Sewer Storm Water Other Business-type Total Service Funds Assets Current Assets Cash and temporary investments 1,613,713$ 3,137,554$ 2,079,965$ 71,239$ 6,902,471$ 502,758$ Receivables Accrued interest 664 12,683 5,828 702 19,877 2,835 Accounts 62,558 138,267 101,374 50,606 352,805 2 Special assessments 51,985 134,194 - - 186,179 - Due from other governments - 654 - - 654 - Prepaid items - 63,916 - - 63,916 19,242 Total Current Assets 1,728,920 3,487,268 2,187,167 122,547 7,525,902 524,837 Noncurrent Assets Capital assets Land 55,052 24,654 6,368 - 86,074 - Construction in progress 1,054,565 - 123,611 - 1,178,176 - Buildings and systems 1,670,843 32,968 - - 1,703,811 - Land Improvements 7,143 - - - 7,143 - Distribution/collection system 6,498,079 20,902,577 2,592,833 - 29,993,489 - Machinery and equipment 100,444 654,570 245,870 238,311 1,239,195 - Total Capital Assets 9,386,126 21,614,769 2,968,682 238,311 34,207,888 - Less accumulated depreciation (3,565,970) (9,047,465) (488,235) (70,073) (13,171,743) - Net Capital Assets 5,820,156 12,567,304 2,480,447 168,238 21,036,145 - Total Assets 7,549,076 16,054,572 4,667,614 290,785 28,562,047 524,837 Deferred Outflows of Resources Deferred pension resources 81,701 80,863 18,310 4,410 185,284 - Business-type Activities - Enterprise Funds City of Orono, Minnesota Statement of Net Position (Continued on the Following Page) Proprietary Funds December 31, 2022 The notes to the financial statements are an integral part of this statement. 48 94 Governmental Activities - Internal Water Sewer Storm Water Other Business-type Total Service Funds Liabilities Current Liabilities Accounts and contracts payable 580,436$ 49,371$ 5,018$ 18,031$ 652,856$ 27,732$ Accrued salaries payable 4,997 3,987 1,012 540 10,536 1,692 Due to other governments 8,909 15,198 - - 24,107 - Accrued interest payable 6,805 - - - 6,805 - Deposits payable 7,000 - - - 7,000 - Compensated absences payable - current portion 9,805 7,742 24,824 - 42,371 - Bond premium - current portion 1,485 - - - 1,485 - Bonds payable - current portion 85,000 - - - 85,000 - Total Current Liabilities 704,437 76,298 30,854 18,571 830,160 29,424 Noncurrent Liabilities Bond premium 8,161 - - - 8,161 - Bonds payable 555,000 - - - 555,000 - Compensated absences payable 883 697 2,236 - 3,816 - Net pension liability 244,971 241,752 55,073 14,589 556,385 - Other postemployment benefits payable 61,341 60,568 40,902 - 162,811 - Total Noncurrent Liabilities 870,356 303,017 98,211 14,589 1,286,173 - Total Liabilities 1,574,793 379,315 129,065 33,160 2,116,333 29,424 Deferred Inflows of Resources Deferred pension resources - 153 - - 153 - Net Position Net investment in capital assets 5,171,995 12,567,304 2,480,447 168,238 20,387,984 - Unrestricted 883,989 3,188,663 2,076,412 93,797 6,242,861 495,413 Total Net Position 6,055,984$ 15,755,967$ 4,556,859$ 262,035$ 26,630,845 495,413$ 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 97,455 26,728,300$ City of Orono, Minnesota Statement of Net Position (Continued) Proprietary Funds December 31, 2022 Business-type Activities - Enterprise Funds The notes to the financial statements are an integral part of this statement. 49 95 THIS PAGE IS LEFT BLANK INTENTIONALLY 50 96 Governmental Activities - Internal Water Sewer Storm Water Other Business-type Total Service Funds Operating Revenues Charges for services 1,799,535$ 2,289,172$ 741,086$ 312,568$ 5,142,361$ 400,024$ Other - - - - - 330,294 Total Operating Revenues 1,799,535 2,289,172 741,086 312,568 5,142,361 730,318 Operating Expenses Personnel services 365,599 355,862 76,869 14,821 813,151 358,624 Supplies 121,843 11,011 4,574 - 137,428 13,470 Professional services 44,587 49,965 37,800 260,454 392,806 180,410 Utilities 111,294 42,891 - - 154,185 - Repairs and maintenance 110,450 82,899 20,810 - 214,159 288,921 Depreciation 222,103 379,040 65,065 16,394 682,602 - Administrative charges from the General fund 82,950 82,950 41,905 1,873 209,678 - Insurance 19,501 11,037 2,760 - 33,298 217,306 Other 70,946 953,022 191,159 14,305 1,229,432 - Total Operating Expenses 1,149,273 1,968,677 440,942 307,847 3,866,739 1,058,731 Operating Income (Loss)650,262 320,495 300,144 4,721 1,275,622 (328,413) Nonoperating Revenues (Expenses) Investment earnings (loss)(49,505) (112,058) (78,960) (4,457) (244,980) (35,622) Intergovernmental 460,000 - - 8,486 468,486 - Miscellaneous revenues 18,922 5,454 246 8,878 33,500 - Interest and amortization expense (14,988) - - - (14,988) - Total Nonoperating Revenues (Expenses)414,429 (106,604) (78,714) 12,907 242,018 (35,622) Income (Loss) Before Contributions and Transfers 1,064,691 213,891 221,430 17,628 1,517,640 (364,035) Contributions and Transfers Capital contributions 9,600 7,698 - - 17,298 - Connection fees - 11,210 16,119 - 27,329 - Transfers out (15,000) (82,500) - - (97,500) - Total Transfers and Contributions (5,400) (63,592) 16,119 - (52,873) - Change in Net Position 1,059,291 150,299 237,549 17,628 1,464,767 (364,035) Net Position - January 1 4,996,693 15,605,668 4,319,310 244,407 25,166,078 859,448 Net Position, December 31 6,055,984$ 15,755,967$ 4,556,859$ 262,035$ 26,630,845$ 495,413$ Change in net position as shown above 1,464,767$ (14,738) Change in net position - business-type activities 1,450,029$ Adjustment to reflect the consolidation of internal service fund activities to the enterprise funds. City of Orono, Minnesota Statement of Revenues, Expenses and Changes in Net Position Proprietary Funds For the Year Ended December 31, 2022 Business-type Activities - Enterprise Funds The notes to the financial statements are an integral part of this statement. 51 97 Governmental Activities - Internal Water Sewer Storm Other Business-type Total Service Funds Cash Flows from Operating Activities Receipts from customers and users 1,798,081$ 2,298,522$ 727,184$ 259,511$ 5,083,298$ 730,316$ Other operating receipts 18,922 5,454 246 8,878 33,500 - Payments to suppliers (562,832) (1,235,866) (295,582) (273,112) (2,367,392) (668,846) Payments to employees (328,900) (324,170) (78,982) (38,582) (770,634) (358,624) Net Cash Provided (Used) by Operating Activities 925,271 743,940 352,866 (43,305) 1,978,772 (297,154) Cash Flows from Noncapital Financing Activities Intergovernmental 460,000 - - 8,486 468,486 Transfers to other funds (15,000) (82,500) - - (97,500) - Net Cash Provided (Used) by . Noncapital Financing Activities 445,000 (82,500) - 8,486 370,986 - Cash Flows from Capital and Related Financing Activities Connection fees received - 11,210 16,119 - 27,329 - Special assessments received 9,524 42,024 - - 51,548 - Acquisition of capital assets (497,615) (575,896) (160,089) - (1,233,600) - Interest paid on debt (17,181) - - - (17,181) - Principal paid on bonds (85,000) - - - (85,000) - Net Cash Used by Capital and Related Financing Activities (590,272) (522,662) (143,970) - (1,256,904) - Cash Flows from Investing Activities Investment receipts (loss)(49,505) (120,929) (83,351) (4,711) (258,496) (37,326) Net Increase (Decrease) in Cash and Cash Equivalents 730,494 17,849 125,545 (39,530) 834,358 (334,480) Cash and Cash Equivalents, January 1 883,219 3,119,705 1,954,420 110,769 6,068,113 837,238 Cash and Cash Equivalents, December 31 1,613,713$ 3,137,554$ 2,079,965$ 71,239$ 6,902,471$ 502,758$ City of Orono, Minnesota Statement of Cash Flows (Continued on the Following Page) Proprietary Funds For the Year Ended December 31, 2022 Business-type Activities - Enterprise Funds The notes to the financial statements are an integral part of this statement. 52 98 Governmental Activities - Internal Water Sewer Storm Other Business-type Total Service Funds Reconciliation of Operating Income (Loss) to Net Cash Provided (Used) by Operating Activities Operating income (loss)650,262$ 320,495$ 300,144$ 4,721$ 1,275,622$ (328,413)$ Adjustments to reconcile operating income (loss) to net cash provided (used) by operating activities Depreciation 222,103 379,040 65,065 16,394 682,602 - Other income related to operations 18,922 5,454 246 8,878 33,500 - (Increase) decrease in assets/deferred outflows of resources Accounts receivable (1,454) 5,805 (13,902) (6,159) (15,710) (2) Due from other governments - 3,545 - - 3,545 - Inventories 14,779 - - - 14,779 - Prepaid items - (4,879) - - (4,879) 25,674 Deferred OPEB resources (1,181) (1,614) (855) - (3,650) - Deferred pension resources (2,277) (11,889) 6,185 15,635 7,654 - Increase (decrease) in liabilities/deferred inflows of resources Accounts and contracts payable (16,621) (3,471) 3,426 3,520 (13,146) 5,587 Unearned revenue - - - (46,898) (46,898) - Due to other governments 581 6,259 - - 6,840 - Compensated absences payable 199 197 550 - 946 - Net pension liability 134,161 145,523 20,899 (13,376) 287,207 - Other postemployment benefits payable 8,892 (11,148) 2,903 - 647 - Deferred pension resources (103,095) (89,377) (31,795) (26,020) (250,287) - Net Cash Provided (Used) by Operating Activities 925,271$ 743,940$ 352,866$ (43,305)$ 1,978,772$ (297,154)$ Schedule of Noncash Capital and Related Financing Activities Capital assets acquired on account 556,950$ 7,455$ -$ -$ 564,405$ -$ Amortization of bond premium 1,485$ -$ -$ -$ 1,485$ -$ Business-type Activities - Enterprise Funds For the Year Ended December 31, 2022 City of Orono, Minnesota Statement of Cash Flows (Continued) Proprietary Funds The notes to the financial statements are an integral part of this statement. 53 99 THIS PAGE IS LEFT BLANK INTENTIONALLY 54 100 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 1: Summary of Significant Accounting Policies A. Reporting Entity The City of Orono (the City) operates under the State of Minnesota Statutory Plan A form of government. 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 th e proper administering of all affairs relating to the City. The City has considered all potential units for which it is financially accountable, and other organizations for which the nature and significance of their relationship with the City are such that exclusion would cause the City’s financial statements to be misleading or incomplete. The City includes all funds, organizations, institutions, agencies, departments, and offices that are not legally separate from such. Component units are legally separate organizations for which the elected officials of the City are financially accountable and are included within the basic financial statements of the City because of their operational or financial relationships with the City. The Governmental Accounting Standards Board (GASB) has set forth criteria to be considered in determining financial accountability. These criteria include appointing a voting majority of an organization’s governing body, and (1) the ability of the primary government to impose its will on that organization or (2) the potential for the organization to provide specific benefits to, or impose specific financial burdens on the primary government. Included in the City’s reporting entity, based upon the application of these criteria, is the following blended component unit. Blended 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. B. Government-wide and Fund Financial Statements The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the nonfiduciary activities of the primary government. 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 fees and charges for support. The statement of activities demonstrates the degree to which the direct expenses o f a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Amounts reported as 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 and 2) grants and contributions that are restricted to meeting the operational or capital requ irements of a particular function or segment. Taxes and other items not included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds and proprietary funds. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. 55 101 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 1: Summary of Significant Accounting Policies (Continued) C. Measurement Focus, Basis of Accounting and Financial Statement Presentation The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the City considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences , pensions, and claims and judgments, are recorded only when payment is due. Property taxes, franchise taxes, licenses and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. 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. All other revenue items are considered to be measurable and available only when cash is received by the City. Revenue resulting from exchange transactions, in which each party gives and receives essentially equal value, is recorded on the accrual basis when the exchange takes place. On a modified accrual basis, revenue is recorded in the year in which the resources are measurable and become available. Non-exchange transactions, in which the City receives value without directly giving equal value in return, include property taxes, grants, entitlement and donations. On an accrual basis, revenue from property taxes is recognized in the year for which the tax is levied. Revenue from grants, entitlements and donations is recognized in the year in which all eligibility requirements have been satisfied. Eligibility requirements include timing requirements, which specify the year when the resources are required to be used or the year when use is first permitted, matching requirements, in which the City must provide local resources to be used for a specified purpose, and expenditure requirements, in which the resources are provided to the City on a reimbursement basis. On a modified accrual basis, revenue from non-exchange transactions must also be available before it can be recognized. Unearned revenue arises when assets are recognized before revenue recognition criteria have been satisfied. Grants and entitlements received before eligibility requirements are met are also recorded as unearned revenue. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. 56 102 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 1: Summary of Significant Accounting Policies (Continued) The City reports the following major governmental funds: The General fund is the government’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. The Municipal State Aid Street fund is used to collect and spend resources on the various projects related to state aid streets and highways. The Pavement Management Plan fund collects and allocates resources related to the repair and maintenance of roads within the city. The Project Construction fund is used to collect and spend resources related to various construction projects within the city. The City reports the following major proprietary funds: The Water fund and the Sewer fund account for activities related to the operation of a water distribution system and a sanitary sewer distribution system, respectively. The Sewer Fund is used to account for the provision of water services to the residents of the City who have sanitary sewer service available. The Storm Water 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 account for insurance, compensated absences, fleet management, and IT services provided to other departments or agencies of the City. 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 vehi cles, and IT services provided to various City functions. These funds are reimbursed through charges to the various participating departments of the City. As a general rule the effect of interfund activity has been eliminated from government-wide financial statements. Exceptions to this general rule are payments in-lieu of taxes, payments where the amounts are reasonably equivalent in value to the interfund services provided and other charges between the City’s water and sewer function and various other functions of the City. Elimination of these charges would distort the direct cost s and program revenues reported for the various functions concerned. Proprietary funds distinguish operating revenues and expenses from non-operating 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 enterprise funds and of the Cit y’s internal service funds are charges to customers for sales and services. Operating expenses for 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 non-operating revenues and expenses. 57 103 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 1: Summary of Significant Accounting Policies (Continued) D. Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources and Net Position/Fund Balance Deposits 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’s cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments. The proprietary funds’ portion in the government-wide cash and temporary investments pool is considered to be cash and cash equivalents for purposes of the Statement of Cash Flows. Cash balances from all funds are pooled and invested, to the extent available, in certificates of deposit and other authorized investments. Earnings from such investments are allocated on the basis of applicable participation by each of the funds. The City may also invest idle funds as authorized by Minnesota statutes, as follows: 1. Direct obligations or obligations guaranteed by the United States or its agencies. 2. Shares of investment companies registered under the Federal Investment Company Act of 1940 and received the highest credit rating, rated in one of the two highest rating categories by a statistical rating agency, and have a final maturity of thirteen months or less. 3. General obligations of a state or local government with taxing powers rated “A” or better; revenue obligations rated “AA” or better. 4. General obligations of the Minnesota Housing Finance Agency rated “A” or better. 5. Obligation of a school district with an original maturity not exceeding 13 months and (i) rated in the highest category by a national bond rating service or (ii) enrolled in the credit enhancement program pursuant to statute section 126C.55. 6. Bankers’ acceptances of United States banks eligible for purchase by the Federal Reserve System. 7. Commercial paper issued by United States banks corporations or their Canadian subsidiaries, of highest quality category by at least two nationally recognized rating agencies, and maturing in 270 days or less. 8. Repurchase or reverse repurchase 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, a primary reporting dealer in U.S. government securities to the Federal Reserve Bank of New York, or certain Minnesota securities broker-dealers. 9. Guaranteed Investment Contracts (GIC’s) issued or guaranteed by a United States commercial bank, a domestic branch of a foreign bank, a United States insurance company, or its Canadian subsidiary, whose similar debt obligations were rated in one of the top two rating categories by a nationally recognized rating agency. The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. 58 104 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 1: Summary of Significant Accounting Policies (Continued) The City has the following recurring fair value measurements as of December 31, 2022: • Negotiable certificates of deposits, government agency securities and municipal bonds of $12,572,070 are valued using a matrix pricing model (Level 2 inputs) Property Taxes Property taxes are submitted to the County Auditor by December of each year, to be levied on January 1 on property values assessed as of the same date. The tax levy notice is mailed in March with the first half payment due on May 15 and the second half payment due on October 15. Unpaid taxes at December 31 become liens on the respective property and are classified in the fund financial statements as delinquent taxes receivable. Delinquent taxes receivable include the past six years' uncollected taxes. Delinquent taxes have been offset by a deferred inflow of resources for taxes not received within 60 days after year end in the governmental fund financial statements. Accounts Receivable All miscellaneous accounts receivable are shown at net of an allowance for doubtful accounts. Accounts receivable include amounts billed for services, such as water, sewer, storm water and nuisance charges, provided before year end. Unbilled utility enterprise fund receivables are also included for services provided in 2022. The City annually certifies delinquent water, sewer, storm water and nuisance accounts to the County for collection in the following year. Therefore, there has been no allowance for doubtful accounts established. All trade (utility) and property tax receivables are shown at gross amount, since both taxes and trade (utility) receivables are assessable to the property taxes and are collectible upon the sale of the assessed property. Lease Receivable The City’s lease receivable is measured at the present value of lease payments expected to be received during the lease term. Under the lease agreement, the City may receive variable lease payments that are dependent upon the lessee’s revenue. The variable payments are recorded as an inflow of resources in the period the payment is received. A deferred inflow of resources is recorded for the lease. The deferred inflow of resources is recorded at the initiation of the lease in an amount equal to the initial recording of the lease receivable. The deferred inflow of resources is amortized on a straight-line basis over the term of the lease. Due From Other Governments The amounts due from other government primarily include amounts for project cost in which the City is receiving grants to support the projects. Special Assessments Special assessments represent the financing for public improvements paid for by benefiting property owners. These assessments are recorded as receivables upon certification to the County. Special assessments are recognized as revenue when they are received in cash or within 60 days after year end. All governmental special assessments receivable are offset by a deferred inflow of resources in the fund financial statements. At December 31, 2022, the total delinquent special assessment receivable balance is $20,312. 59 105 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 1: Summary of Significant Accounting Policies (Continued) Interfund Receivables and Payables Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either “due to/from other funds” (i.e., the current portion of interfund loans) or “advances to/from other funds” (i.e., the non-current portion of interfund loans). All other outstanding balances between funds are report ed 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.” Inventories and Prepaid Items All inventories are valued at cost using the first in/first out (FIFO) method. Inventories of governmental funds are recorded as expenditures when consumed rather than when purchased. 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. Prepaid items are reported using the consumption method and recorded as expenditures/expenses at the time of consumption. 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. Capital assets are depreciated using the straight-line method over their estimated useful lives. Land and construction in progress are not depreciated. Property, plant and equipment of the City is depreciated using the straight line method over the following estimated useful lives: Useful Life Assets in Years Infrastructure 20 - 50 Buildings and Systems 15 - 50 Improvements Other Than Buildings 20 - 50 Machinery and Equipment 5 - 10 Deferred Outflows of Resources In addition to assets, the statement of net position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, 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 then. The City has only one item that qualifies for reporting in this category. Accordingly, the item, deferred pension resources, is reported only in the statements of net position. This item resu lts from actuarial calculations and current year pension contributions made subsequent to the measurement date. 60 106 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 1: Summary of Significant Accounting Policies (Continued) Compensated Absences 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. A liability for these amounts is reported in governmental funds only if they have matured, for example, as a result of employee resignations and retirements. For the most part, the General fund is typically used to liquidate governmental compensated absences payable. Postemployment Benefits other than Pensions Under Minnesota statute 471.61, subdivision 2b, public employers must allow retirees and their dependents to continue coverage indefinitely in an employer-sponsored health care plan, under the following conditions: 1) Retirees must be receiving (or eligible to receive) an annuity from a Minnesota public pension plan, 2) Coverage must continue in a group plan until age 65, and retirees must pay no more than the group premium, and 3) Retirees are able to add dependent coverage during open enrollment period or qualifying life event prior to retirement. All premiums are funded on a pay-as- you-go basis. The liability was determined, in accordance with GASB Statement No. 75, at January 1, 2021. The General fund is typically used to liquidate governmental other postemployment benefits payable. Long-term Obligations In the government-wide financial statements, and proprietary fund types in the fund financial statements, long -term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business -type activities, or proprietary fund type statement of net position. The recognition of bond premiums and discounts are amortized over the life of the bonds using the straight-line method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are reported as an expense in the period incurred. In accordance with federal regulations, the City’s general obligation tax exempt bonds follow the arbitrage requirements. In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. Pensions For purposes of measuring the net pension liability, deferred outflows/inflows of resources, and pension expense, information about the fiduciary net position of the Public Employees Retirement Association (PERA) and additions to/deductions from PERA’s fiduciary net position have been determined on the same basis as they are reported by PERA except that PERA’s fiscal year end is June 30. For this purpose, plan contributions are recognized as of employer payroll paid dates and benefit payments and refunds are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. For the most part, the General fund is typically used to liquidate governmental pension liabilities. 61 107 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 1: Summary of Significant Accounting Policies (Continued) The City participates in various pension plans, total pension expense for the year ended December 31, 2022 is as follows: Total All GERP PEPFF Plans City's proportionate share 420,872$ 786,500$ 1,207,372$ Porportionate share of State's contrinution 10,516 82,358 92,874 Total pension expense 431,388$ 868,858$ 1,300,246$ Association of Minnesota (PERA) Public Employees Retirement Deferred Inflows of Resources In addition to liabilities, the statement of net position and fund financial statements will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The City has three types of items, which arise only under a modified accrual basis of accounting that qualifies as needing to be reported in this category. Accordingly, the item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from two sources: delinquent property taxes and property taxes levied for subsequent year. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available. The City also recognizes a deferred lease resources, which is reported under both the modified accrual and full accrual basis Furthermore, the City has one additional item which qualifies for reporting in this category on the statement of net position. The item, deferred pension resources, is reported only in the statement of net position and results from actuarial calculations involving net differences between projected and actual earnings on plan investments and changes in proportions. Net Position Net position represents the difference between assets and deferred outflows of resources and liabilities and deferred inflows of resources. Net position is displayed in three components: a. Net investment in capital assets - Consists of capital assets, net of accumulated depreciation reduced by any outstanding debt attributable to acquire capital assets. a. Restricted net position - Consists of net position balances restricted when there are limitations imposed on their use through external restrictions imposed by creditors, grantors, laws or regulations of other governments. b. Unrestricted net position - All other net position balances that do not meet the definition of “restricted” or “net investment in capital assets”. When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, then unrestricted resources as they are needed. 62 108 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 1: Summary of Significant Accounting Policies (Continued) Fund Balance In the fund financial statements, fund balance is divided into five classifications based primarily on the extent to which th e City is bound to observe constraints imposed upon the use of resources reported in the governmental funds. These classifications are defined as follows: Nonspendable - Amounts that cannot be spent because they are not in spendable form, such as prepaid items. Restricted - Amounts related to externally imposed constraints established by creditors, grantors or contributors; or constraints imposed by state statutory provisions. Committed - Amounts constrained for specific purposes that are internally imposed by formal action (resolution) of the City Council, which is the City’s highest level of decision -making authority. Committed amounts cannot be used for any other purpose unless the City Council modifies or rescinds the commitment by resolution. Assigned - These are amounts that are constrained by the City’s intent to be used for specific purposes but are neither restricted nor committed. Pursuant to the Fund Balance Policy approved by City Council, the City Administrator has been delegated the authority to assign and remove assignments of fund balance amounts for specific purposes. Unassigned - These are residual amounts in the General fund not reported in any other classification. The General fund is the only fund that can report a positive unassigned fund balance. Other funds would report a negative unassigned fund balance should the total of nonspendable, restricted and committed fund balances exceed the total net resources of that fund. The City considers restricted amounts to be spent first when both restricted and unrestricted fund balance is available. Additionally, the City would first use committed, then assigned, and lastly unassigned amounts of unrestricted fund balance when expenditures are made. 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 Pavement Management Plan Fund pursuant to Council approval Note 2: Stewardship, Compliance and Accountability A. Budgetary Information 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. 63 109 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 2: Stewardship, Compliance and Accountability (Continued) B.Deficit Fund Equity The following fund had a fund equity deficit at December 31, 2022: Amount Major Municipal State Aid Street 1,507,050$ Pavement Management Plan 1,117,246 Nonmajor Governmental 2010 General Obligation Bond 234,924 2021 Improvement Bonds 372,404 Park 402,933 Senior Housing TIF 454,098 Internal Services Fleet Management 125,994 IT Services 246,763 Fund The fund deficits are expected to be eliminated with future fund revenues or transfers from other funds. Note 3: Detailed Notes on All Funds A.Deposits and Investments Deposits Custodial credit risk for deposits and investments is the risk that in the event of a bank failure, the City’s deposits and investments may not be returned or the City will not be able to recover collateral securities in the possession of an outside party. In accordance with Minnesota statutes and as authorized by the City Council, the City maintains deposits at depository banks, all of which are members of the Federal Reserve System. Minnesota statutes require that all City deposits be protected by insurance, surety bond or collateral. The market value of collateral pledged must equal 110 percent of the deposits not covered by insurance or bonds, with the exception of irrevocable standby letters of credit issued by Federal Home Loan Banks as this type of collateral only requires collateral pledged equal to 100 percent of the deposits not covered by insurance or bonds. Authorized collateral in lieu of a corporate surety bond includes: •United States government Treasury bills, Treasury notes, Treasury bonds; •Issues of United States government agencies and instrumentalities as quoted by a recognized industry quotation service available to the government entity; •General obligation securities of any state or local government with taxing powers which is rated “A” or better by a national bond rating service, or revenue obligation securities of any state or local government with taxing powers which is rated “AA” or better by a national bond rating service; •General obligation securities of a local government with taxing powers may be pledged as collateral against funds deposited by that same local government entity; •Irrevocable standby letters of credit issued by Federal Home Loan Banks to a municipality accompanied by written evidence that the bank’s public debt is rated “AA” or better by Moody’s Investors Service, Inc., or Standard & Poor’s Corporation; and •Time deposits that are fully insured by any federal agency.64 110 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 3: Detailed Notes on All Funds (Continued) Minnesota statutes require that all collateral shall be placed in safekeeping in a restricted account at a 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 selection should be approved by the government entity. At year end, the City’s carrying amount of deposits was $65,450 and the bank balance was $211,048. The bank balance was covered by federal depository insurance. Investments The Minnesota Municipal Money Market Fund (the 4M Fund) is regulated by Minnesota statutes and the Board of Directors of the League of Minnesota Cities and is a customized cash management and investment program for Minnesota public funds. Sponsored and governed by the League of Minnesota Cities since 1987, the 4M Fund is a unique investment alternative designed to address the daily and long -term investment needs of Minnesota cities and other municipal entities. Allowable under Minnesota statutes, the 4M Fund is comprised of top quality, rated investments. The Minnesota Municipal Money Market Fund and broker money market investment pools operate in accordance with appropriate State laws and regulations. The 4M Fund is an external investment pool not registered with the Securities and Exchange Commission (SEC); however, it follows the same regulatory rules of the SEC under rule 2a7. The reported value of the pool is the same as the fair value of the pool share. Financial statements of the 4M Fund can be obtained by contacting RBC Global Asset Management at 100 South Fifth Street, Suite 2300, Minneapolis, MN 55402-1240. At year end, the City’s investment balances were as follows: Credit Segmented Quality/Time Ratings (1)Distribution (2)Amount Level 1 Level 2 Level 3 Pooled Investments at Amortized Costs Broker Money Market Funds N/A less than 6 months 61,631$ 4M fund N/A less than 6 months 19,469,659 Non-pooled Investments at Fair Value Negotiable Certificates of Deposits N/A less than 1 year 1,690,214 -$ 1,690,214$ -$ Negotiable Certificates of Deposits N/A 1 to 3 years 3,016,775 - 3,016,775 - Negotiable Certificates of Deposits N/A more than 3 years 1,757,518 - 1,757,518 - Government Agency Securities AA+less than year 1,061,410 - 1,061,410 - Municipal Bonds AAA less than 1 year 1,402,758 - 1,402,758 - Municipal Bonds AAA 1 to 3 years 1,281,670 - 1,281,670 - Municipal Bonds AAA more than 3 years 2,361,725 - 2,361,725 - Total Investments 32,103,360$ -$ 12,572,070$ -$ Types of Investments Fair Value Measurement Using (1)Ratings are provided by Standard & Poor’s where applicable to indicate associated credit risk. (2)Interest rate risk in disclosed using the segmented time distribution method. N/A Indicates not applicable or available. 65 111 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 3: Detailed Notes on All Funds (Continued) The investments of the City are subject to the following risks: •Interest Rate Risk - Interest Rate Risk is the risk that changes in interest rates will adversely affect the fair value of an investment. The City’s investment policy also provides a guideline that generally limits the duration of investments to a maturity of eight years, and twenty percent (20 percent) of the portfolio to a specific maturity. The City was not exposed to interest rate risks due to the fact that their investments are not exposed to highly sensitive changes in interest rates. •Credit Risk - Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. Ratings are provided by various credit rating agencies and where applicable, indicate associated credit risk. Minnesota statutes and the City’s investment policy limit the City’s investments to the list on page 56 of the notes to the financial statements. In accordance with its investment policy, the City will minimize credit risk by limiting investments to the safest types of securities, pre-qualifying the financial institutions, broker/dealers, intermediaries, and advisers with which the City will do business, and diversifying the investment portfolio so that the impact of potential losses from any one type of security or from any one individual issuer will be minimized. The City’s investment policies do not allow investing in the following instruments: •Reverse repurchase agreements •Mortgage-backed securities, as defined in Minnesota Statute § 118A.04, Subd. 6 •Future contracts •Options •Guaranteed investment contracts •Concentration of Credit Risk - Concentration of credit risk is defined as positions of five percent (5 percent) or more in the securities of a single issuer. The City’s investment policies provide a guideline of limiting investments to 35% of a specific type. As of December 31, 2022, the following issuer exceeded 5 percent of the City’s total investments: MN Municipal Money Markets (4M) (61 percent). •Custodial Credit Risk - Deposits. In the case of deposits, this is the risk that in the event of a bank failure, the City's deposits may not be returned to it. Minnesota statutes and the City's investment policy states that in order to provide a level of security for all funds, the collateralization level will be 110 percent of market value not covered by insurance. 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 percent, except for the City’s main checking account at the First National Bank of the Lakes, Navarre. As of December 31, 2022, all of the City's bank balance was covered by federal depository insurance or by perfected collateral held by the City's agent in the City's name. •Custodial Credit Risk - Investments. For an investment, this is the risk that, in the event of the failure of the counterparty, the City will not be able to recover the value of its investments or collateral securities that are in possession of an outside party. As of December 31, 2022, all securities were held by the City or its agent in the City's name. 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 $40,000,000 and may include “primary” dealers or regional dealers, and are located in Minnesota. The City limits the amount of investments with a specific dealer to 30 percent of the investment portfolio. 66 112 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 3: Detailed Notes on All Funds (Continued) A reconciliation of cash and temporary investments as shown on the statement of net position for the City follows: Carrying Amount of Deposits 65,452$ Investments 32,103,360 Total 32,168,812$ B.Capital Assets Capital asset activity for the year ended December 31, 2022 was as follows: Beginning Ending Balance Increases Decreases Balance Governmental Activities Capital Assets not Being Depreciated Land 7,677,435$ -$ -$ 7,677,435$ Construction in progress 2,106,260 1,679,755 (402,825) 3,383,190 Total Capital Assets not Being Depreciated 9,783,695 1,679,755 (402,825) 11,060,625 Capital Assets Being Depreciated Infrastructure 16,969,831 402,825 - 17,372,656 Buildings and systems 9,187,905 - - 9,187,905 Improvements other than buildings 3,899,636 - - 3,899,636 Machinery and equipment 5,640,159 685,601 - 6,325,760 Total Capital Assets Being Depreciated 35,697,531 1,088,426 - 36,785,957 Less Accumulated Depreciation for Infrastructure (3,726,106) (398,834) - (4,124,940) Buildings and systems (1,616,951) (187,340) - (1,804,291) Improvements other than buildings (1,818,445) (99,928) - (1,918,373) Machinery and equipment (3,230,031) (419,784) - (3,649,815) Total Accumulated Depreciation (10,391,533) (1,105,886) - (11,497,419) Depreciated, Net 25,305,998 (17,460) - 25,288,538 Governmental Activities Capital Assets, Net 35,089,693$ 1,662,295$ (402,825)$ 36,349,163$ Total Capital Assets Being 67 113 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 3: Detailed Notes on All Funds (Continued) Depreciation expense was charged to functions of the governmental activities as follows: Governmental Activities General Government 233,794$ Public Safety 230,969 Public Works 551,667 Culture and Recreation 89,456 Total Depreciation Expense - Governmental Activities 1,105,886$ Beginning Ending Balance Increases Decreases Balance Business-type Activities Capital Assets not Being Depreciated Land 86,074$ -$ -$ 86,074$ Construction in progress 245,058 1,178,177 (245,059) 1,178,176 Total Capital Assets not Being Depreciated 331,132 1,178,177 (245,059) 1,264,250 Capital Assets Being Depreciated Buildings and systems 1,703,811 - - 1,703,811 Land Improvements 7,143 - - 7,143 Machinery and equipment 1,239,195 - - 1,239,195 Distribution/collection system 29,347,293 646,196 - 29,993,489 Total Capital Assets Being Depreciated 32,297,442 646,196 - 32,943,638 Less Accumulated Depreciation for Buildings and systems (696,642) (70,541) - (767,183) Land Improvements (7,409) (253) - (7,662) Machinery and equipment (683,303) (62,236) - (745,539) Distribution/collection system (11,101,787) (549,572) - (11,651,359) Total Accumulated Depreciation (12,489,141) (682,602) - (13,171,743) Total Capital Assets Being Depreciated, Net 19,808,301 (36,406) - 19,771,895 Business-type Activities Capital Assets, Net 20,139,433$ 1,141,771$ (245,059)$ 21,036,145$ 68 114 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 3: Detailed Notes on All Funds (Continued) Depreciation expense was charged to programs of the business -type activities as follows: Business-type Activities Water 222,103$ Sewer 379,040 Golf Course 65,065 Cable 16,394 Total Depreciation Expense - Business-type Activities 682,602$ C.Construction Commitments The City has active construction projects as of December 31, 2022. The projects include street and road improvements and the watermain replacement project. At year end the City’s commitments with contractors are as follows: Spent Remaining to Date Commitment 2022 Street Improvements - Asphalt Surface Technologies 821,287$ 25,116$ Watermain Replacement (CSAH 19) - Geislinger and Sons Inc.901,016 522,506 Public Works Facility - Ebert Consturction - 16,067,000 Project D.Lease Receivable As of December 31, 2022, the City had the following lease receivables: Current Year Issue Discount Infow of Balance at Date Rate Resources Year End Antenna Lease - Verizion 01/01/22 1.47%52,141$ 735,229$ Description Under the Antenna lease, Verizon pays the City $52,141 per year in exchange for placing a cell phone antenna on a City owned building. The city is paid these amounts each January, with a 3% increase each year until 2036. E.Interfund Receivables, Payables and Transfers The composition of interfund balances at December 31, 2022 is as follows: Purpose Amount General Fund Pavement Management Plan To provide cash flows 1,251,205$ General Fund Municipal State Aid Street To provide cash flows 1,504,286 Senior Housing TIF HRA General Fund Loan for Land Purchase 601,467 Total 3,356,958$ Payable FundReceivable Fund 69 115 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 3: Detailed Notes on All Funds (Continued) The City made transfers during the fiscal year 2022 as shown and described below: Transfer In Nonmajor Governmental Transfer Out General 300,000$ Water 15,000 Sewer 82,500 Total 397,500$ •The General fund transferred $400,000 to the Nonmajor Governmental funds for future capital purchases and for debt service payments. •The Water fund transferred $20,000 and the Sewer funds transferred $110,000 to the Nonmajor Governmental funds for future debt service and capital funding. F.Long-term Debt General Obligation Improvement (G.O.) Bonds The bonds were issued to finance various improvements and will be repaid from taxes, special assessments and pledged revenues. Authorized Issue Maturity Balance at and Issued Date Date Year End Governmental Activites G.O. Improvement Bonds, Series 2021A 15,350,000$ 2.00 - 3.00 %12/31/21 12/31/51 15,350,000$ G.O. Improvement Bonds, Series 2014A 5,275,000 2.00 - 3.00 06/19/14 02/01/29 1,780,000 Street Reconstruction Refunding Bonds, Series 2016A 3,505,000 2.00 - 3.00 12/11/17 02/01/23 520,000 Total G.O. Inmprovement Bonds 17,650,000$ Business Activites G.O. Improvement Bonds, Series 2014A 5,275,000 2.00 - 3.00 06/19/14 02/01/29 640,000$ Interest RateDescription 70 116 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 3: Detailed Notes on All Funds (Continued) Annual debt service requirements to maturity for G.O. improvement bonds are as follows: Year Ending December 31,Principal Interest Total 2023 1,095,000$ 429,388$ 1,524,388$ 2024 595,000 407,144 1,002,144 2025 615,000 387,275 1,002,275 2026 635,000 366,519 1,001,519 2027 655,000 344,557 999,557 2028 - 2032 2,780,000 1,392,039 4,172,039 2033 - 2037 2,575,000 1,047,720 3,622,720 2038 - 2042 2,830,000 780,220 3,610,220 2043 - 2044 3,125,000 485,620 3,610,620 2048 - 2051 2,745,000 147,256 2,892,256 Total 17,650,000$ 5,787,738$ 23,437,738$ Governmental Activities Year Ending December 31,Principal Interest Total 2023 85,000$ 15,428$ 100,428$ 2024 85,000 13,569 98,569 2025 90,000 11,544 101,544 2026 90,000 9,350 99,350 2027 95,000 6,919 101,919 2028 - 2029 195,000 5,806 200,806 Total 640,000$ 62,616$ 702,616$ Business-type Activities 71 117 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 3: Detailed Notes on All Funds (Continued) Changes in Long-term Liabilities Long-term liability activity for the year ended December 31, 2022 was as follows: Beginning Ending Due Within Balance Increases Decreases Balance One Year Governmental Activities Bonds Payable G.O. improvement bonds 18,385,000$ -$ (735,000)$ 17,650,000$ 1,095,000$ Bond premium 745,963 - (69,957) 676,006 47,747 Total Bonds Payable 19,130,963 - (804,957) 18,326,006 1,142,747 Compensated Absences Payable 628,904 578,058 (576,831) 630,131 578,058 Governmental Activity Long-term Liabilities 19,759,867$ 578,058$ (1,381,788)$ 18,956,137$ 1,720,805$ Business-type Activities Bonds Payable G.O. improvement bonds 725,000$ -$ (85,000)$ 640,000$ 85,000$ Bond premium 11,131 - (1,485) 9,646 1,485 Total Bonds Payable 736,131 - (86,485) 649,646 86,485 Compensated Absences Payable 45,241 42,371 (41,425) 46,187 42,371 Business-type Activity Long-term Liabilities 781,372$ 42,371$ (127,910)$ 695,833$ 128,856$ 72 118 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 3: Detailed Notes on All Funds (Continued) G.Components of Fund Balance Fund equity balances are classified below to reflect the limitations and restrictions of the respective funds. Municipal State Aid Other General Street Governmental Total Nonspendable Prepaid items $ 33,771 $- $- $- $- $ 33,771 Restricted for Debt service - - - - 1,506,830 1,506,830 Building projects - - - 15,151,607 - 15,151,607 Drug and alcohol law enforcement - - - - 558,680 558,680 Home buyer purchase assistance - - - - 134,830 134,830 Lurton Park development and maintenance - - - - 6,847 6,847 Senior Housing - - - - - - Golf course Improvements - - - - - - Big Island Improvements - - - - 85,609 85,609 Other improvements - - - - 146 146 HRA General fund - - - - 601,467 601,467 Total Restricted - - - 15,151,607 2,894,409 18,046,016 Committed to Park maintnence - - - - 64,885 64,885 Assigned to Capital improvements - - - 700,600 2,516,883 3,217,483 Unassigned 5,219,544 (1,507,050) (1,117,246)- (1,464,359) 1,130,889 Total 5,253,315$ (1,507,050)$ (1,117,246)$ 15,852,207$ 4,011,818$ 22,493,044$ Pavement Management Plan Project Construction Fund Note 4: Defined Benefit Pension Plans - Statewide A.Plan Description The City 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 Internal Revenue Code. General Employees Retirement Plan All full-time and certain part-time employees of the City are covered by the General Employees Plan. G eneral Employees Plan members belong to the Coordinated Plan. Coordinated Plan members are covered by Social Security. Public Employees 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 P olice 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. 73 119 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 4: Defined Benefit Pension Plans - Statewide (Continued) 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. 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. General Employee Plan Benefits General Employee Plan 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 Plan members. Members hired prior to July 1, 1989 receive the higher of Method 1 or Method 2 formulas. Only Method 2 is used for members hired after June 30, 1989. Under Method 1, the accrual rate for Coordinated members is 1.2 percent of average salary for each of the first 10 years of service and 1.7 percent of average salary for each additional year. Under Method 2, the accrual rate for Coordinated members is 1.7 percent for average salary for all years of service. For members hired prior to July 1, 1989 a full annuity is available wh en 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. Benefit increases are provided to benefit recipients each January. The postretirement increase is equal to 50 percent of the cost-of-living adjustment (COLA) announced by the SSA, with a minimum increase of at least 1 percent and a maximum of 1.5 percent. Recipients that have been receiving the annuity or benefit for at least a full year as of the June 30 before the effective date of the increase will receive the full increase. Recipients receiving the annuity or benefit for at least one month but less than a full year as of the June 30 before the effective date of the increase will receive a reduced prorated increase. For members retiring on January 1, 2024, or later, the increase will be delayed until normal retirement age (age 65 if hired prior to July 1, 1989, or age 66 for individuals hired on or after July 1, 1989). Members retiring under Rule of 90 are exempt from the delay to normal retirement. 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 percent after five years up to 100 percent after ten years of credited service. Benefits for Police and Fire Plan members first hired after June 30, 2014 vest on a prorated basis from 50 percent after ten years up to 100 percent after twenty years of credited service. The annuity accrual rate is 3 percent of average salary for each year of service. A full, unreduced pension is earned when members are age 55 and vested, or for members who were first hired prior to July 1, 1989, when age plus years of service equal at least 90. Benefit increases are provided to benefit recipients each January. The postretirement increase is fixed at 1 percent. Recipients that have been receiving the annuity or benefit for at least 36 months as of the June 30 before the effective date of the increase will receive the full increase. For recipients receiving the annuity or benefit for at least 25 months but less than 36 months as of the June 30 before the effective date of the increase will receive a reduced prorated increase. C.Contributions Minnesota statutes chapter 353 sets the rates for employer and employee contributions. Contribution rates can only be modified by the state Legislature. General Employees Fund Contributions Coordinated Plan members were required to contribute 6.50 percent of their annual covered salary in fiscal year 2022 and the City was required to contribute 7.50 percent for Coordinated Plan members in fiscal year 2022. The City’s contributions to the General Employees Fund for the year ending December 31, 2022, 2021 and 2020 were $178,034, $145,120 and $152,742, respectively. The City’s contributions were equal to the required contributions for each year as set by state statute. 74 120 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 4: Defined Benefit Pension Plans - Statewide (Continued) Police and Fire Fund Contributions Police and Fire member’s contribution rates increased from 11.30 percent of pay to 11.80 percent and employer rates increased from 16.95 percent to 17.70 percent on January 1, 2022. The City’s contributions to the Police and Fire Fund for the years ending December 31, 2022, 2021 and 2020 were $460,205, $462,202 and $455,708, respectively. The City’s contributions were equal to the required contributions for each year as set by state statute. D.Pension Costs General Employees Fund Pension Costs At December 31, 2022, the City reported a liability of $2,399,770 for its proportionate share of the General Employees Fund’s net pension liability. The City’s net pension liability reflected a reduction due to the State of Minnesota’s contribution of $16 million. The State of Minnesota is considered a non-employer contributing entity and the State’s contribution meets the definition of a special funding situation. The State of Minnesota’s proportionate share of the net pension liability associated with the City totaled $70,380. The net pension liability was measured as of June 30, 2022, and the total pension liability used to calculate the net pension liability was determined by an actuar ial valuation as of that date. The City’s proportionate share of the net pension liability was based on the City’s contributions received by PERA during the measurement period for employer payroll paid dates from July 1, 2021 through June 30, 2022 relative to the total employer contributions received from all of PERA’s participating employers. The City’s proportionate share was 0.0303 at the end of the measurement period and .0266 percent for the beginning of the period. City's Proportionate Share of the Net Pension Liability 2,399,770$ State of Minnesota's Proportionate Share of the Net Pension Liability Associated with the City 70,380 Total 2,470,150$ For the year ended December 31, 2022, the City recognized pension expense $420,872 for its proportionate share of the General Employees Plan’s pension expense. In addition, the City recognized an additional $10,516 as pension expense (and grant revenue) for its proportionate share of the State of Minnesota’s contribution of $16 million to the General Employees Fund. 75 121 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 4: Defined Benefit Pension Plans - Statewide (Continued) At December 31, 2022, the City reported its proportionate share of the General Employees Plan’s deferred outflows of resources and deferred inflows of resources, related to pensions from the following sources: Deferred Deferred Outflows Inflows of Resources of Resources Differences Between Expected and Actual Economic Experience 20,045$ 22,550$ Changes in Actuarial Assumptions 478,794 8,761 Net Difference Between Projected and Actual Earnings on Plan Investments 144,293 - Changes in Proportion 86,759 8,993 Contributions to PERA Subsequent to the Measurement Date 88,744 - Total 818,635$ 40,304$ The $88,744 reported as deferred outflows of resources related to pensions resulting from the City’s contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended December 31, 2023. Other amounts reported as deferred outflows and inflows of resources related to pensions will be recognized in pension expense as follows: 251,019$ 260,697 (39,152) 217,023 2023 2024 2025 2026 Police and Fire Fund Pension Costs At December 31, 2022, the City reported a liability of $9,721,486 for its proportionate share of the Police and Fire Fund’s net pension liability. The net pension liability was measured as of June 30, 2022, 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 proportionate share 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, 2021 through June 30, 2022 relative to the total employer contributions received from all of PERA’s participating employers. The City’s proportionate share was 0.2234 percent at the end of the measurement period and 0.2136 percent for the beginning of the period. The State of Minnesota also contributed $13.5 million to the Police and Fire Fund in the plan fiscal year ended June 30, 2022. The contribution consisted of $4.5 million in direct state aid that does meet the definition of a special funding situation and $9.0 million in fire state aid that does not meet the definition of a special funding situation. The $9 million direct state was paid on October 1, 20 21. Thereafter, by October 1 of each year, the state will pay $9 million to the Police and Fire Fund until full funding is reached or July 1, 2048, whichever is earlier. The $9 million in fire state aid will continue until the fund is 90 percent funded, or until the State Patrol Plan (administered by the Minnesota State Retirement System) is 90 percent funded, whichever occurs later. 76 122 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 4: Defined Benefit Pension Plans - Statewide (Continued) As a result, the State of Minnesota is included as a non-employer contributing entity in the Police and Fire Retirement Plan Schedule of Employer Allocations and Schedule of Pension Amounts by Employer, Current Reporting Period Only (pension allocation schedules) for the $4.5 million in direct state aid. Police and Fire Plan employers need to recognize their proportionate share of the State of Minnesota’s pension expense (and grant revenue) under GASB 68 special funding situation accounting and financial reporting requirements For the year ended December 31, 2022, City recognized pension expense of $786,500 for its proportionate share of the Police and Fire Fund’s pension expense. In addition, the City recognized an additional $82,358 as pension expense (and grant revenue) for its proportionate share of the State of Minnesota’s contribution of $9 million to the Police and Fire Fund. At December 31, 2022, the City reported its proportionate share of the Police and Fire Plan’s deferred outflows of resources and deferred inflows of resources from the following sources: Deferred Deferred Outflows Inflows of Resources of Resources Differences Between Expected and Actual Economic Experience 585,047$ 8,782$ Changes in Actuarial Assumptions 5,657,646 84,684 Net Difference Between Projected and Actual Earnings on Plan Investments 241,555 - Changes in Proportion 111,894 95,619 Contributions to PEPFP Subsequent to the Measurement Date 239,927 - Total 6,836,069$ 189,085$ The $239,927 reported as deferred outflows of resources related to pensions resulting from the City’s contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended December 31, 2023. Other amounts reported as deferred outflows and inflows of resources related to pensions will be recognized in pension expense as follows: 1,251,723$ 1,250,517 1,103,908 1,992,064 808,845 2023 2024 2025 2026 2027 77 123 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 4: Defined Benefit Pension Plans - Statewide (Continued) E. Long -Term Expected Return on Investment The State Board of Investment, which manages the investments of PERA, prepares an analysis of the 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 weighting 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 in the following table: Asset Class Target Allocation Long-Term Expected Real Rate of Return Domestic Equity 33.5% 5.10% International Equity 16.5% 5.30% Fixed Income 25.0% 0.75% Private Markets 25.0% 5.90% Total 100% F.Actuarial Assumptions The total pension liability in the June 30, 2022, actuarial valuation was determined using an individual entry-age normal actuarial cost method: The long-term rate of return on pension plan investments used in the determination of the total liability is 6.5 percent. This assumption is based on a review of inflation and investments return assumptions from a number of national investment consulting firms. The review provided a range of return investment return rates deemed to be reasonable by the actuary. An investment return of 6.5 percent was deemed to be within that range of reasonableness for financial reporting purposes. Inflation is assumed to be 2.25 percent for the General Employees Plan and 2.25 percent for the Police and Fire Plan. Benefit increases after retirement are assumed to be 1.25 percent for the General Employees Plan. The Police and Fire Plan benefit increase is fixed at 1.00 percent per year and that increase was used in the valuation. Salary growth assumptions in the General Employees Plan range in annual increments from 10.25 percent after one year of service to 3.0 percent after 27 years of service. In the Police and Fire Plan, salary growth assumptions range from 11.75 percent after one year of service to 3.0 percent after 24 years of service. Mortality rates for the General Employees Plan are based on the Pub -2010 General Employee Mortality Table. Mortality rates for the Police and Fire Plan is based on the Pub-2010 Public Safety Employee Mortality tables. The tables are adjusted slightly to fit PERA’s experience. Actuarial assumptions used in the June 30, 2022 valuation were based on the results of actuarial experience studies. The most recent four-year experience study in the General Employees Plan was completed in 2019. The assumption changes were adopted by the Board and become effective with the July 1, 2020 actuarial valuation. The most recent four-year experience study for the Police and Fire Plan was completed in 2020 were adopted by the Board and became effective with the July 1, 2021 actuarial valuation. 78 124 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 4: Defined Benefit Pension Plans - Statewide (Continued) The following changes in actuarial assumptions and plan provisions occurred in 2022: General Employees Fund Changes in Actuarial Assumptions •The mortality improvement scale was changed from Scale MP-2020 to Scale MP-2021. Changes in Plan Provisions •There were no changes in plan provisions since the previous valuation. Police and Fire Fund Changes in Actuarial Assumptions •The mortality improvement scale was changed from Scale MP-2020 to Scale MP-2021 •The single discount rate changed from 6.50 percent to 5.40 percent. Changes in Plan Provisions •There have been no changes since the prior valuation. G.Discount Rate The discount rate used to measure the total pension liability in 2022 was 6.50 percent. The projection of cash flows used to determine the discount rate assumed that contributions from plan members and employers will be made at r ates set in Minnesota statutes. Based on these assumptions, the fiduciary net position of the G eneral 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 on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. H.Pension Liability Sensitivity The following presents the City’s proportionate share of the net pension liability for all plans it participates in, calculat ed 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: 1 Percent 1 Percent Decrease (5.50%) Current (6.50%) Increase (7.50%) General Employees Fund 3,790,562$ 2,399,770$ 1,259,106$ 1 Percent 1 Percent Decrease (4.40%) Current (5.40%) Increase (6.40%) Police and Fire Fund 14,712,221 9,721,486 5,686,774 City Proportionate Share of NPL 79 125 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 4: Defined Benefit Pension Plans - Statewide (Continued) I.Pension Plan Fiduciary Net Position 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. Note 5: Postemployment Benefits Other Than Pensions A.Plan Description The City provides a single-employer defined benefit health care plan to eligible retirees and their spouses. The plan offers medical coverage and is administered by Health Partners, Inc.. It is the City’s policy for Council to periodically review its medical coverage, and to obtain requests for proposals in order to provide the most favorable benefits and premiums for City employees and retirees. The City does not issue a publicly available report. Inactive Plan Members or Beneficiaries Currently Receiving Benefit Payments 3 Active Plan Members 52 Total Plan Members 55 B.Funding Policy Retirees receiving benefits contribute 100 percent of their premium costs. Retirees and their spouses contribute to the health care plan at the same rate as City employees. This results in the retirees receiving an implicit rate subsidy. Contribution requirements are established by the City, based on the contract terms with HealthPartners, Inc. The required contributions are based on projected pay-as-you-go financing requirements. For the year ended December 31, 2022, the City’s average contribution rate was .5 percent of covered-employee payroll. For fiscal year 2022, the City contributed $0 to the plan. As of January 1, 2022, there were three retirees receiving health benefits from the City’s health plan. C.Actuarial Methods and Assumptions The City’s total OPEB liability of $1,241,000 was measured as of January 1, 2022, and the total OPEB liability used to calculate the total OPEB liability was determined by an actuarial valuation as of January 1, 2022. Roll forward procedures were used to roll forward the total OPEB liability to the measurement date. The total OPEB liability in the January 1, 2022 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement, unless otherwise specified: Discount Rate 2.06% Payroll Growth Rate N/A 20-Year Municipal Bond Yield 2.06% Inflation Rate 2.50% Medical Trend Rate 8% degrading to 4.14% by 2027 The discount rate used to measure the total OPEB liability was 2.06 percent as of January 1, 2022. Mortality rates were based on the recently published PERA actuarial valuations. The actuarial assumptions used in the January 1, 2022 valuation were based on input from a variety of published sources of historical and projected future financial data. Each assumption was reviewed for reasonableness with the source information as well as for consistency with the other economic assumptions . 80 126 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 5: Postemployment Benefits Other Than Pensions (Continued) D.Changes in the Total OPEB Liability Total OPEB Liability (a) Balances at December 31, 2021 1,056,791$ Changes for the Year: Service cost 118,604 Interest 24,704 Differences between expected and actual experience 405,645 Changes in assumptions or other inputs (344,599) Benefit payments (20,145) Net Changes 184,209 Balances at December 31, 2022 1,241,000$ Since the prior measurement date, the following assumptions changed: •The discount rate was changed from 2.12% to 2.06%%. •Medical trend was updated based on recently published trend model and trend surveys to better reflect anticipated experience •Medical per capita tables were updated based on recent experience and demographics •Future retiree participation rates were updated from 75% to 60% based on analysis of past plan experience •Future retiree spouse participation rates were updated from 30% for PERA Coordinated and 45% for PERA Police and Fire to 60% for all participants based on analysis of past plan experience •Assumed retirement age was updated from the 2017 PERA assumptions to 63 for PERA Coordinated and 56 for Police and Fire •Mortality, Termination, Salary Scale and Disability assumptions were updated to those included in the recently published PERA actuarial valuations. E.Sensitivity of the Total OPEB Liability The following presents the total OPEB liability of the City, as well as what the City’s total OPEB liability would be if it were calculated using a discount rate that is 1-percentage point lower (1.06 percent) or 1-percentage-point higher (3.06 percent) than the current discount rate: 1 Percent 1 Percent Decrease (1.06%)Current (2.06%)Increase (3.06%) 1,335,045$ 1,241,000$ 1,150,739$ 81 127 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 5: Postemployment Benefits Other Than Pensions (Continued) The following presents the total OPEB liability of the City, as well as what the City’s total OPEB liability would be if it were calculated using a Healthcare Cost Trent Rate that is 1 -percentage point lower (7 percent decreasing to 6 percent) or 1- percentage-point higher (9 percent increasing to 8 percent) than the current cost trend rate: Healthcare Cost 1 Percent Decrease Trend Rates 1 Percent Increase (7% Decreasing (8% Decreasing (9% Decreasing to 6%)to 7%)to 8%) 1,082,820$ 1,241,000$ 1,428,750$ Note 6:Other Information A.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; injuries to employees; and natural disasters. Workers compensation coverage is provided through a pooled self-insurance program through the League of Minnesota Cities Insurance Trust (LMCIT). The City pays an annual premium to the LMCIT. The City is subject to supplemental assessments if deemed necessary by the LMCIT. The LMCIT reinsures through Workers Compensation Reinsurance Association (WCRA) as required by law. For workers compensation, the City is not subject to a deductible. Property and casualty insurance is provided through a pooled self -insurance program through the LMCIT. The City pays an annual premium to the LMCIT. The City is subject to supplemental assessments if deemed necessary by the LMCIT. The LMCIT reinsures through commercial companies for claim s in excess of various amounts. The City retains risk for the deductible portion of the insurance policies and for any exclusion s from the insurance policies. These amounts are considered immaterial to the financial statements. The City continues to carry commercial insurance for all other risks of loss, including disability and employee health insurance. There were no significant reductions in insurance from the previous year or settlements in excess of insurance coverage for any of the past three fiscal years. The risk management activities of the City are accounted for by the Risk Management fund, an internal service fund, which charges its costs to user departments. The fund is designed to build up a reserve which will provide the City the opportunity to assume a greater share of its insurance risks and thereby reducing the cost to purchase insurance. B.Contingencies Tax Increment Financing Districts The City’s tax increment districts are subject to review by the State of Minnesota Office of the State Auditor (OSA). Any disallowed claims or misuse of tax increments could become a liability of the applicable fund. Management has indicated that they are not aware of any instances of noncompliance which would have a material effect on the financial statements. The City has entered into “pay as you go” Tax Increment Financing notes within its TIF districts. These notes are payable only to the extent of the increment received. As a result, they are a commitment within the district but they have not met the criteria to be reported as a liability on the statement of net position. 82 128 City of Orono, Minnesota Notes to the Financial Statements December 31, 2022 Note 6: Other Information (Continued) C.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 childcare 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 o f 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. D.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. E.Police Services Contracts As of December 31, 2019, 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 $1,545,000 in 2013 and increasing between 1%-5% each year through the end of the contract. The contract has been renewed as of December 31, 2022. The City also has a contract with the cities of Minnetonka Beach and Spring Park to furnish law enforcement services to each respective city. The original contract term ended December 31, 2012 and includes the option to verbally extend it each year for an additional one-year period. The contract has been extended each year through 202 3. Note 7: Change in Accounting Principles For fiscal year 2022, the City implemented Governmental Accounting Standards Board (GASB) Statement No. 87, Leases. GASB Statement No. 87 enhances the relevance and consistency of information of the government’s leasing activities. It establishes requirements for lease accounting based on the principle that leases are financings of the right to use an underlying asset. A lessee is required to recognize a lease liability and an intangible right to use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources. These changes were incorporated in the City’s 2022 financial statements. 83 129 THIS PAGE IS LEFT BLANK INTENTIONALLY 84 130 REQUIRED SUPPLEMENTARY INFORMATION CITY OF ORONO, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2022 85 131 City of Orono, Minnesota Required Supplementary Information For the Year Ended December 31, 2022 Schedule of Employer’s Share of PERA Net Pension Liability - General Employees Fund State's Proportionate City's Share of Proportionate the Net Pension Share of Liability City's Fiscal the Net Pension Associated with Covered Year Liability the City Total Payroll Ending (a)(b)(a+b)(c) 06/30/22 0.0303 %2,399,770$ 70,380$ 2,470,150$ 2,270,505$ 105.7 %76.7 % 06/30/21 0.0266 1,135,939 34,674 1,170,613 1,916,486 59.3 87.0 06/30/20 0.0272 1,630,764 50,397 1,681,161 1,942,203 84.0 79.0 06/30/19 0.0267 1,476,182 45,831 1,522,013 1,823,839 80.9 80.2 06/30/18 0.0256 1,420,183 - 1,420,183 1,679,073 84.6 79.5 06/30/17 0.0254 1,621,519 - 1,621,519 1,623,207 99.9 75.9 06/30/16 0.0259 2,102,952 - 2,102,952 1,570,420 133.9 68.9 06/30/15 0.0265 1,373,368 - 1,373,368 766,147 179.3 78.2 Plan Fiduciary the Net Pension of the Total Liability Pension Liability Net Position Proportion of as a Percentage Payroll (a/c) Covered City's City's Liability as a Percentage of Proportionate Share of the Net Pension Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. Schedule of Employer’s PERA Contributions - General Employees Fund Contributions in Relation to the Statutorily Statutorily Contribution City's Required Required Deficiency Covered Year Contribution Contribution (Excess) Payroll Ending (a)(b)(a-b)(c) 12/31/22 178,034$ 178,034$ -$ 2,373,789$ 7.50 % 12/31/21 145,120 145,120 - 1,934,938 7.50 12/31/20 152,742 152,742 - 2,036,563 7.50 12/31/19 144,815 144,815 - 1,930,863 7.50 12/31/18 129,021 129,021 - 1,720,280 7.50 12/31/17 122,479 122,479 - 1,633,053 7.50 12/31/16 122,115 122,115 - 1,628,200 7.50 12/31/15 119,404 119,404 - 1,592,053 7.50 (b/c) a Percentage of Payroll Covered Contributions as Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. 86 132 City of Orono, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2022 Notes to the Required Supplementary Information - General Employees Fund Changes in Actuarial Assumptions 2022 - The mortality improvement scale was changed from Scale MP-2020 to Scale MP-2021. 2021 - The investment return and single discount rates were changed from 7.50 percent to 6.50 percent, for financial reporting purposes. The mortality improvement scale was changed from Scale MP -2019 to Scale MP-2020. 2020 - The price inflation assumption was decreased from 2.50% to 2.25%. The payroll growth assumption was decreased from 3.25% to 3.00%. Assumed salary increase rates were changed as recommended in the June 30, 2019 experience study. The net effect is assumed rates that average 0.25% less than previous rates. Assumed rates of retirement were changed as recommended in the June 30, 2019 experience study. The changes result in more unreduced (normal) retirements and slightly fewer Rule of 90 and early retirements. Assumed rates of termination were changed as recommended in the June 30, 2019 experience study. The new rates are based on service and are generally lower than the previous rates for years 2-5 and slightly higher thereafter. Assumed rates of disability were changed as recommended in the June 30, 2019 experience study. The change results in fewer predicted disability retirements for males and females. The base mortality table for healthy annuitants and employees was changed from the RP -2014 table to the Pub-2010 General Mortality table, with adjustments. The base mortality table for disabled annuitants was changed from the RP - 2014 disabled annuitant mortality table to the PUB -2010 General/Teacher disabled annuitant mortality table, with adjustments. The mortality improvement scale was changed from Scale MP-2018 to Scale MP-2019. The assumed spouse age difference was changed from two years older for females to one year older. The assumed number of married male new retirees electing the 100% Joint & Survivor option changed from 35% to 45%. The assumed number of married female new retirees electing the 100% Joint & Survivor option changed from 15% to 30%. The corresponding number of married new retirees electing the Life annuity option was adjusted accordingly. 2019 - The mortality projection was changed from MP-2017 to MP-2018 2018 - The mortality projection scale was changed from MP-2015 to MP-2017. The assumed benefit increase was changed from 1.00 percent per year through 2044 and 2.50 percent per year thereafter to 1.25 percent per year. 2017 - The Combined Service Annuity (CSA) loads were changed from 0.8 percent for active members and 60 percent for vested and non-vested deferred members. The revised CSA loads are now 0.0 percent for active member liability, 15.0 percent for vested deferred member liability and 3.0 percent for non-vested deferred member liability. The assumed post- retirement benefit increase rate was changed from 1.0 percent per year for all years to 1.0 percent per year through 2044 and 2.5 percent per year thereafter. 2016 - The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2035 and 2.5 percent per year thereafter to 1.0 percent per year for all future years. The assumed investment return was changed from 7.9 percent to 7.5 percent. The single discount rate was changed from 7.9 percent to 7.5 percent. Other assumptions were changed pursuant to the experience study dated June 30, 2015. The assumed future salary increases, payroll growth and inflation were decreased by 0.25 percent to 3.25 percent for payroll growth and 2.50 percent for inflation. 2015 - The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2030 and 2.5 percent per year thereafter to 1.0 percent per year through 2035 and 2.5 percent per year thereafter. 87 133 City of Orono, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2022 Notes to the Required Supplementary Information - General Employees Fund (Continued) Changes in Plan Provisions 2022 - There were no changes in plan provisions since the previous valuation. 2021 - There were no changes in plan provisions since the previous valuation. 2020 - Augmentation for current privatized members was reduced to 2.0% for the period July 1, 2020 through December 31, 2023 and 0.0% after. Augmentation was eliminated for privatizations occurring after June 30, 2020. 2019 - The employer supplemental contribution was changed prospectively, decreasing from $31.0 million to $21.0 million per year. The state’s special funding contribution was changed prospectively, requiring $16.0 million due per year through 2031. 2018 - The augmentation adjustment in early retirement factors is eliminated over a five-year period starting July 1, 2019, resulting in actuarial equivalence after June 30, 2024. Interest credited on member contributions decreased from 4.00 percent to 3.00 percent, beginning July 1, 2018. Deferred augmentation was changed to 0.00 percent, effective January 1, 2019. Augmentation that has already accrued for deferred members will still apply. Contribution stabilizer provisions were repealed. Postretirement benefit increases were changed from 1.00 percent per year with a provision to increase to 2.50 percent upon attainment of 90.00 percent funding ratio to 50.00 percent of the Social Security Cost of Living Adjustment, not less than 1.00 percent and not more than 1.50 percent, beginning January 1, 2019. For retirements on or after January 1, 2024, the first benefit increase is delayed until the retiree reaches normal retirement age; does not apply to Rule of 90 retirees, disability benefit recipients, or survivors. Actuarial equivalent factors were updated to reflect revised mortality and interest assumptions. 2017 - The State’s contribution for the Minneapolis Employees Retirement Fund equals $16,000,000 in 2017 and 2018, and $6,000,000 thereafter. The Employer Supplemental Contribution for the Minneapolis Employees Retirement Fund changed from $21,000,000 to $31,000,000 in calendar years 2019 to 2031. The state’s contribution changed from $16,000,000 to $6,000,000 in calendar years 2019 to 2031. 2016 - There were no changes in plan provisions since the previous valuation. 2015 - On January 1, 2015, the Minneapolis Employees Retirement Fund was merged into the General Employees Fund, which increased the total pension liability by $1.1 billion and increased the fiduciary plan net position by $892 million. Upon consolidation, state and employer contributions were revised. 88 134 City of Orono, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2022 Schedule of Employer’s Share of PERA Net Pension Liability - Public Employees Police and Fire Fund State's Proportionate City's Share of Proportionate the Net Pension Share of Liability City's Fiscal the Net Pension Associated with Covered Year Liability the City Total Payroll Ending (a)(b)(a+b)(c) 06/30/22 0.2234 % 9,721,486$ 424,580$ 10,146,066$ 2,713,224$ 358.3 % 70.5 % 06/30/21 0.2136 1,648,766 74,123 1,722,889 2,524,268 65.3 93.7 06/30/20 0.2173 2,864,247 - 2,864,247 2,453,352 116.7 87.2 06/30/19 0.2257 2,402,804 - 2,402,804 2,363,617 101.7 89.3 06/30/18 0.2170 2,312,996 - 2,312,996 2,237,340 103.4 88.8 06/30/17 0.2130 2,875,753 - 2,875,753 2,144,407 134.1 85.4 06/30/16 0.2180 8,748,719 - 8,748,719 2,078,460 420.9 63.9 the Net Pension Payroll of the Total Liability (a/c)Pension Liability City's Percentage of Net Position Proportion of Covered as a Percentage Liability as a Plan Fiduciary City's Proportionate Share of the Net Pension Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. Schedule of Employer’s PERA Contributions - Public Employees Police and Fire Fund Contributions in Relation to the Statutorily Statutorily Contribution City's Required Required Deficiency Covered Year Contribution Contribution (Excess) Payroll Ending (a)(b)(a-b)(c) 12/31/22 460,205$ 460,205$ -$ 2,600,029$ 17.70 % 12/31/21 462,202 462,202 - 2,611,311 17.70 12/31/20 455,708 455,708 - 2,574,623 17.70 12/31/19 411,298 411,298 - 2,538,879 16.20 12/31/18 370,490 370,490 - 2,286,975 16.20 12/31/17 358,655 358,655 - 2,187,704 16.20 12/31/16 340,380 340,380 - 2,101,111 16.20 (b/c) Contributions as a Percentage of Payroll Covered Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. 89 135 City of Orono, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2022 Notes to the Required Supplementary Information - Police and Fire Fund Changes in Actuarial Assumptions 2022 - The mortality improvement scale was changed from Scale MP-2020 to Scale MP-2021. The single discount rate changed from 6.50 percent to 5.40 percent. 2021 - The investment return and single discount rates were changed from 7.50 percent to 6.50 percent, for financial reporting purposes. The inflation assumption was changed from 2.50 percent to 2.25 percent. The payroll growth assumption was changed from 3.25 percent to 3.00 percent. The base mortality table for healthy annuitants and employees was changed from the RP-2014 table to the Pub-2010 Public Safety Mortality table. The mortality improvement scale was changed from MP-2019 to MN-2020. The base mortality table for disabled annuitants was changed from the RP-2014 healthy annuitant mortality table (with future mortality improvement according to Scale MP-2019) to the Pub- 2010 Public Safety disabled annuitant mortality table (with future mortality improvement according to Scale MP -2020). Assumed rates of salary increase were modified as recommend ed in the July 14, 2020 experience study. The overall impact is a decrease in gross salary increase rates. Assumed rates of retirement were changed as recommended in the July 14, 2020 experience study. The changes result in slightly more unreduced retireme nts and fewer assumed early retirements. Assumed rates of withdrawal were changed from select and ultimate rates to service-based rates. The changes result in more assumed terminations. Assumed rates of disability were increased for ages 25 -44 and decreased for ages over 49. Overall, proposed rates result in more projected disabilities. Assumed percent married for active female members was changed from 60 percent to 70 percent. Minor changes to form of payment assumptions were applied. 2020 - The mortality projection scale was changed from MP-2018 to MP-2019 2019 - The mortality projection scale was changed from MP-2017 to MP-2018. 2018 - The mortality projection scale was changed from MP-2016 to MP-2017. As set by statute, the assumed post- retirement benefit increase was changed from 1.0 percent per year through 2064 and 2.5 percent per year, thereafter, to 1.0 percent for all years, with no trigger. 2017 - Assumed salary increases were changed as recommended in the June 30, 2016 experience study. The net effect is proposed rates that average 0.34 percent lower than the previous rates. Assumed rates of retirement were changed, resulting in fewer retirements. The Combined Service Annuity (CSA) load was 30 percent for vested and non-vested deferred members. The CSA has been changed to 33 percent for vested members and 2 percent for non -vested members. The base mortality table for healthy annuitants was changed from the RP-2000 fully generational table to the RP-2014 fully generational table (with a base year of 2006), with male rates adjusted by a factor of 0.96. The mortality improvement scale was changed from Scale AA to Scale MP-2016. The base mortality table for disabled annuitants was changed from the RP-2000 disabled mortality table to the mortality tables assumed for healthy retirees. Assumed termination rates were decreased to 3.0 percent for the first three years of service. Rates beyond the se lect period of three years were adjusted, resulting in more expected terminations overall. Assumed percentage of married female members was decreased from 65 percent to 60 percent. Assumed age difference was changed from separate assumptions for male members (wives assumed to be three years younger) and female members (husbands assumed to be four years older) to the assumption that males are two years older than females. The assumed percentage of female members electing joint and survivor annuities was increased. The assumed post-retirement benefit increase rate was changed from 1.00 percent for all years to 1.00 percent per year through 2064 and 2.50 percent thereafter. The single discount rate was changed from 5.6 percent to 7.5 percent. 2016 - The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2037 and 2.5 percent per year thereafter to 1.0 percent per year for all future years. The assumed investment return was changed from 7.9 percent to 7.5 percent. The single discount rate was changed from 7.9 percent to 5.6 percent. The assumed future salary increases, payroll growth and inflation were decreased by 0.25 percent to 3.25 percent for payroll growth and 2.50 percent for inflation. 2015 - The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2030 and 2.5 percent per year thereafter to 1.0 percent per year through 2037 and 2.5 percent per year thereafter. 90 136 City of Orono, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2022 Notes to the Required Supplementary Information - Police and Fire Fund (Continued) Changes in Plan Provisions 2022 - There were no changes in plan provisions since the previous valuation. 2021 - There were no changes in plan provisions since the previous valuation 2020 - There were no changes in plan provisions since the previous valuation 2019 - There were no changes in plan provisions since the previous valuation 2018 - As set by statute, the assumed post-retirement benefit increase was changed from 1.0 percent per year through 2064 and 2.5 percent per year, thereafter, to 1.0 percent for all years, with no trigger. An end date of July 1, 2048 was added to the existing $9.0 million state contribution. New annual state aid will equal $4.5 million in fiscal years 2019 and 2020, and $9.0 million thereafter until the plan reaches 100 percent funding, or July 1, 2048, if earlier. Member contributions were changed from 10.80 percent to 11.30 percent of pay, effective January 1, 2019 and 11.80 percent of pay, effective January 1, 2020. Employer contributions were changed from 16.20 percent to 16.95 percent of pay, effective January 1, 2019 and 17.70 percent of pay, effective January 1, 2020. Interest credited on member contributions decreased from 4.00 percent to 3.00 percent, beginning July 1, 2018. Deferred augmentation was changed to 0.00 percent, effective January 1, 2019. Augmentation that has already accrued for deferred members will still apply. Actuarial equivalent factors were updated to reflect revised mortality and interest assumptions. 2017 - Assumed salary increases were changed as recommended in the June 30, 2016 experience study. The net effect is proposed rates that average 0.34 percent lower than the previous rates. Assumed rates of retirement were changed, resulting in fewer retirements. The combined service annuity (CSA) load was 30.00 percent for vested and non-vested, deferred members. The CSA has been changed to 33.00 percent for vested members and 2.00 percent for non -vested members. The base mortality table for healthy annuitants was changed from the RP-2000 fully generational table to the RP-2014 fully generational table (with a base year of 2006), with male rates adjusted by a factor of 0.96. The mortality improvement scale was changed from Scale AA to Scale MP-2016. The base mortality table for disabled annuitants was changed from the RP-2000 disabled mortality table to the mortality tables assumed for healthy retirees. Assumed termination rates were decreased to 3.00 percent for the first three years of service. Rates beyond the select period of three years were adjusted, resulting in more expected terminations overall. Assumed percentage of married female members was decreased from 65.00 percent to 60.00 percent. Assumed age difference was changed from separate assumptions for male members (wives assumed to be three years younger) and female members (husbands assumed to be four years older) to the assumption that males are two years older than females. The assumed percentage of female members electing joint and survivor annuities was increased. The assumed postretirement benefit increase rate was changed from 1.00 percent for all years to 1.00 percent per year through 2064 and 2.50 percent thereafter. The single discount rate was changed from 5.60 percent per annum to 7.50 percent per annum. 2016 - There were no changes in plan provisions since the previous valuation 2015 - The post-retirement benefit increase to be paid after attainment of the 90 percent funding threshold was changed, from inflation up to 2.5 percent, to a fixed rate of 2.5 percent. 91 137 City of Orono, Minnesota Required Supplementary Information (Continued) For the Year Ended December 31, 2022 Schedule of Changes in the City’s Total OPEB Liability and Related Ratios 2022 2021 2020 2019 Total OPEB Liability Service cost 118,604$ 101,611$ 87,721$ 90,925$ Interest 24,704 27,156 38,684 31,294 Differences between expected and actual experience 405,645 (413) (179,406) - Changes in assumptions (344,599) 53,610 114,403 (49,156) Benefit payments (20,145) (29,318) (30,694) (36,813) Net Change in Total OPEB Liability 184,209 152,646 30,708 36,250 Total OPEB Liability - Beginning 1,056,791 904,145 873,437 837,187 Total OPEB Liability - Ending 1,241,000$ 1,056,791$ 904,145$ 873,437$ Covered Payroll 4,900,000.00$ 4,400,000$ 4,200,000$ 4,000,000$ City's total OPEB liability as a percentage of covered payroll 25.33 % 24.02 % 21.53 % 21.84 % Note: Schedule is intended to show 10-year trend. Additional years will be reported as they become available. 92 138 COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND SCHEDULES CITY OF ORONO, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2022 93 139 THIS PAGE IS LEFT BLANK INTENTIONALLY 94 140 NONMAJOR GOVERNMENTAL FUNDS 95 141 City of Orono, Minnesota Nonmajor Governmental Funds Combining Balance Sheet December 31, 2022 Total Nonmajor Special Debt Capital Governmental Revenue Service Projects Funds Assets Cash and temporary investments 614,303$ 886,405$ 2,508,021$ 4,008,729$ Receivables Accrued interest 2,675 2,085 8,862 13,622 Due from other governments 1,138 11,012 - 12,150 Due from other funds 601,467 - - 601,467 Total Assets 1,219,583$ 899,502$ 2,516,883$ 4,635,968$ Liabilities Accounts and contracts payable 22,683$ -$ -$ 22,683$ Due to other funds 601,467 - - 601,467 Total Liabilities 624,150 - - 624,150 Fund Balances Restricted 1,387,579 1,506,830 - 2,894,409 Committed 64,885 - - 64,885 Assigned - - 2,516,883 2,516,883 Unassigned (857,031) (607,328) - (1,464,359) Total Fund Balances 595,433 899,502 2,516,883 4,011,818 Total Liabilities and Fund Balances 1,219,583$ 899,502$ 2,516,883$ 4,635,968$ 96 142 City of Orono, Minnesota Nonmajor Governmental Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended December 31, 2022 Total Nonmajor Special Debt Capital Governmental Revenue Service Projects Funds Revenues Taxes 187,356$ 580,643$ -$ 767,999$ Special assessments 22,722 - 1,724 24,446 Licenses and permits 7,417 - - 7,417 Intergovernmental - 646,090 - 646,090 Charges for services 26,173 - - 26,173 Fines and forfeitures 14,502 - - 14,502 Investment earnings (loss)(36,029) (63,693) (92,983) (192,705) Miscellaneous 100,122 - 3,033 103,155 Total Revenues 322,263 1,163,040 (88,226) 1,397,077 Expenditures Current Public safety 589 - - 589 Parks and recreation 62,041 - - 62,041 Community development 46,406 - - 46,406 Capital outlay Public works - - 588,254 588,254 Parks and recreation 62,880 - - 62,880 Debt service Principal - 735,000 - 735,000 Interest and other charges - 460,111 - 460,111 Total Expenditures 171,916 1,195,111 588,254 1,955,281 Excess (Deficiency) of Revenues Over (Under) Expenditures 150,347 (32,071) (676,480) (558,204) Other Financing Sources Transfers in - 142,500 255,000 397,500 Net Change in Fund Balances 150,347 110,429 (421,480) (160,704) Fund Balances, January 1 445,086 789,073 2,938,363 4,172,522 Fund Balances, December 31 595,433$ 899,502$ 2,516,883$ 4,011,818$ 97 143 THIS PAGE IS LEFT BLANK INTENTIONALLY 98 144 NONMAJOR SPECIAL REVENUE FUNDS Special Revenue funds are used to account for specific revenues that are legally restricted to expenditures for particular purposes. Park Fund accounts for received park dedication fees to be used for land acquisition and park development. Drug and Felony Forfeiture Fund accounts 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 accounts 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 accounts for revenues and expenditures related to the maintenance and trails within Lurton Park property. Senior Housing TIF Fund accounts for revenues and expenditures related to the senior housing property. Golf Course Improvement Fund accounts for revenues and expenditures related to the improvement of the City’s golf course. Big Island Fund accounts for revenues and expenditures related to the improvement of the Big Island Nature Park. Carmen Bay Lake Improvement Fund accounts for revenues and expenditures related to the improvement of Carmen Bay. HRA General Fund accounts for revenues from and expenditures related to housing programs. 99 145 City of Orono, Minnesota Nonmajor Special Revenue Funds Subcombining Balance Sheet December 31, 2022 225 231 233 234 Drug and Felony Affordable Lurton Park Forfeiture Housing Park Assets Cash and temporary investments (404,065)$ 557,029$ 134,357$ 71,600$ Receivables Accrued interest - 1,651 473 132 Due from other governments 1,132 - - - Due from other funds - - - - Total Assets (402,933)$ 558,680$ 134,830$ 71,732$ Liabilities Accounts and contracts payable -$ -$ -$ -$ Due to other funds - - - - Total Liabilities - - - - Fund Balances Restricted - 558,680 134,830 6,847 Committed - - - 64,885 Unassigned (402,933) - - - Total Fund Balances (402,933) 558,680 134,830 71,732 Total Liabilities, Deferred Inflows of Resources and Fund Balances (402,933)$ 558,680$ 134,830$ 71,732$ 100 146 235 237 238 239 241 Carmen Bay Senior Golf Course Lake HRA General Housing TIF Improvement Big Island Improvement Fund Total 147,067$ -$ 85,506$ 22,809$ -$ 614,303$ 302 - 103 14 - 2,675 - - - 6 - 1,138 - - - 601,467 601,467 147,369$ -$ 85,609$ 22,829$ 601,467$ 1,219,583$ -$ -$ -$ 22,683$ -$ 22,683$ 601,467 - - - 601,467 601,467 - - 22,683 - 624,150 - - 85,609 146 601,467 1,387,579 - - - - - 64,885 (454,098) - - - (857,031) (454,098) - 85,609 146 601,467 595,433 147,369$ -$ 85,609$ 22,829$ 601,467$ 1,219,583$ 101 147 City of Orono, Minnesota Nonmajor Special Revenue Funds Subcombining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended December 31, 2022 225 231 233 234 Drug and Felony Affordable Lurton Park Forfeiture Housing Park Revenues Taxes 99,998$ -$ -$ -$ Special assessments - - - - Licenses and permits 7,417 - - - Charges for services - - - 26,173 Fines and forfeitures - 14,502 - - Investment earnings (loss)890 (20,953) (5,027) (2,744) Miscellaneous 100,651 (529) - - Total Revenues 208,956 (6,980) (5,027) 23,429 Expenditures Current Public safety - 589 - - Parks and recreation 22,538 - - - Community development - - - - Capital outlay Parks and recreation 62,880 - - - Total Expenditures 85,418 589 - - Net Change in Fund Balances 123,538 (7,569) (5,027) 23,429 Fund Balances, January 1 (526,471) 566,249 139,857 48,303 Fund Balances, December 31 (402,933)$ 558,680$ 134,830$ 71,732$ 102 148 235 237 238 239 241 Carmen Bay Senior Golf Course Lake HRA General Housing TIF Improvement Big Island Improvement Fund Total 87,358$ -$ -$ -$ -$ 187,356$ - - - 22,722 - 22,722 - - - - - 7,417 - - - - - 26,173 - - - - - 14,502 (4,227) - (3,216) (752) - (36,029) - - - - - 100,122 83,131 - (3,216) 21,970 - 322,263 - - - - - 589 - 283 - 39,220 - 62,041 46,406 - - - - 46,406 - - - - - 62,880 46,406 283 - 39,220 - 171,916 36,725 (283) (3,216) (17,250) - 150,347 (490,823) 283 88,825 17,396 601,467 445,086 (454,098)$ -$ 85,609$ 146$ 601,467$ 595,433$ 103 149 THIS PAGE IS LEFT BLANK INTENTIONALLY 104 150 NONMAJOR DEBT SERVICE FUNDS Debt Service funds are used to account for the accumulation of resources for, and payment of, principal and interest and related costs on general long-term debt. 2010 General Obligation Bonds is used to collect and spend resources related to bonds issued in 2010. 2000 Improvement Bonds accounts for resources accumulated and payments for principal and interest associated with financing improvement projects. 2016 Refunding Bonds accounts for resources accumulated and payments for principal and interest on the 2016 Refunding bonds. 2021 Improvement Bonds accounts for resources accumulated and payments for principal and interest associated with financing improvement projects. 105 151 City of Orono, Minnesota Nonmajor Debt Service Funds Subcombining Balance Sheet December 31, 2022 321 322 323 324 2000 2016 2021 2010 General Improvement Refunding Improvement Obligation Bonds Bonds Bonds Bonds Total Assets Cash and temporary investments (234,924)$ 620,490$ 873,243$ (372,404)$ 886,405$ Receivables Accrued interest - 2,085 - - 2,085 Due from other governments - 3,749 7,263 - 11,012 Total Assets (234,924)$ 626,324$ 880,506$ (372,404)$ 899,502$ Fund Balances Restricted - 626,324 880,506 - 1,506,830 Unassigned (234,924) - - (372,404) (607,328) TOTAL FUND BALANCES (234,924) 626,324 880,506 (372,404) 899,502 Total Deferred Inflows of Resources and Fund Balances (234,924)$ 626,324$ 880,506$ (372,404)$ 899,502$ 106 152 City of Orono, Minnesota Nonmajor Debt Service Funds Subcombining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended December 31, 2022 321 322 323 324 2000 2016 2021 2010 General Improvement Refunding Improvement Obligation Bonds Bonds Bonds Bonds Total Revenues Taxes 2,556$ 161,457$ 416,630$ -$ 580,643$ Intergovernmental 646,090 - - - 646,090 Investment earnings (loss)(567) (20,988) (42,138) - (63,693) Total Revenues 648,079 140,469 374,492 - 1,163,040 Expenditures Debt service Principal - 230,000 505,000 - 735,000 Interest and other charges 5,875 51,919 29,913 372,404 460,111 Total Expenditures 5,875 281,919 534,913 372,404 1,195,111 Excess (Deficiency) of Revenues Over (Under) Expenditures 642,204 (141,450) (160,421) (372,404) (32,071) Other Financing Sources Transfers in - 45,000 97,500 - 142,500 Net Change in Fund Balances 642,204 (96,450) (62,921) (372,404) 110,429 Fund Balances, January 1 (877,128) 722,774 943,427 - 789,073 Fund Balances, December 31 (234,924)$ 626,324$ 880,506$ (372,404)$ 899,502$ 107 153 THIS PAGE IS LEFT BLANK INTENTIONALLY 108 154 NONMAJOR CAPITAL PROJECTS FUNDS Capital Project funds account for financial resources to be used for acquisition or construction of major capital facilities (other than those financed by Proprietary funds). Improvement Equipment Outlay Fund accounts for the capital outlay costs of obtaining new equipment for various functions. Permanent Revolving Improvement Fund accounts for the construction costs prior to obtaining permanent financing. Community Investment Construction fund is used to collect and spend resources on the various community assets of the City. Navarre Fire Station Construction Fund accounts for the construction costs of a new fire station in the Navarre area of the City. Big Island Public Project Fund accounts for the improvement of the Big Island Nature Park. 109 155 City of Orono, Minnesota Nonmajor Capital Projects Funds Subcombining Balance Sheet December 31, 2022 405 406 408 Improvement Permanent Community Equipment Revolving Investment Outlay Improvement Construction Assets Cash and temporary investments 185,699$ 1,456,121$ 599,303$ Receivables Accrued interest 2,144 5,069 991 Total Assets 187,843$ 1,461,190$ 600,294$ Fund Balances Assigned 187,843$ 1,461,190$ 600,294$ 110 156 425 430 Navarre Big Island Fire Station Public Construction Project Total 897$ 266,001$ 2,508,021$ 10 648 8,862 907$ 266,649$ 2,516,883$ 907$ 266,649$ 2,516,883$ 111 157 City of Orono, Minnesota Nonmajor Capital Projects Funds Subcombining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended December 31, 2022 405 406 408 Improvement Permanent Community Equipment Revolving Investment Outlay Improvement Construction Revenues Special assessments -$ 1,724$ -$ Investment earnings (loss)(6,187) (54,486) (22,318) Miscellaneous 3,033 - - Total Revenues (3,154) (52,762) (22,318) Expenditures Capital outlay Public works 578,230 - 10,024 Excess (Deficiency) of Revenues Over (Under) Expenditures (581,384) (52,762) (32,342) Other Financing Sources Transfers in 255,000 - - Net Change in Fund Balances (326,384) (52,762) (32,342) Fund Balances, January 1 514,227 1,513,952 632,636 Fund Balances, December 31 187,843$ 1,461,190$ 600,294$ 112 158 425 430 Navarre Big Island Fire Station Public Construction Project Total -$ -$ 1,724$ (36) (9,956) (92,983) - - 3,033 (36) (9,956) (88,226) - - 588,254 (36) (9,956) (676,480) - - 255,000 (36) (9,956) (421,480) 943 276,605 2,938,363 907$ 266,649$ 2,516,883$ 113 159 THIS PAGE IS LEFT BLANK INTENTIONALLY 114 160 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 accounts for the revenues and expenses related to the City’s recycling program. Cable Television Fund accounts for the revenues and expenses created from the cable franchise agreements that the City is a part of. 115 161 Recycling Cable Television Total Assets Current Assets Cash and temporary investments 67,089$ 4,150$ 71,239$ Receivables Accrued interest 230 472 702 Accounts 32,528 18,078 50,606 Total Current Assets 99,847 22,700 122,547 Noncurrent Assets Machinery and equipment - 238,311 238,311 Less accumulated depreciation - (70,073) (70,073) Total Noncurrent Assets - 168,238 168,238 Total Assets 99,847 190,938 290,785 Deferred Outflows of Resources Deferred pension resources 2,677 1,733 4,410 Liabilities Current Liabilities Accounts and contracts payable 18,031 - 18,031 Accrued salaries payable 183 357 540 Total Current Liabilities 18,214 357 18,571 Noncurrent Liabilities Net pension liability 8,426 6,163 14,589 Total Liabilities 26,640 6,520 33,160 Net Position Investment in capital assets - 168,238 168,238 Unrestricted 75,884 17,913 93,797 Total Net Position 75,884$ 186,151$ 262,035$ City of Orono, Minnesota Combining Statement of Net Position Nonmajor Proprietary Funds December 31, 2022 Business-type Activities - Enterprise Funds 116 162 Recycling Cable Television Total Operating Revenues Charges for services 239,608$ 72,960$ 312,568$ Operating Expenses Personnel services 5,938 8,883 14,821 Professional services 223,664 36,790 260,454 Depreciation - 16,394 16,394 Administrative charges from the General Fund - 1,873 1,873 Other 14,305 - 14,305 Total Operating Expenses 243,907 63,940 307,847 Operating Loss (4,299) 9,020 4,721 Nonoperating Revenues Intergovernmental 8,486 - 8,486 Investment earnings (loss)(2,596) (1,861) (4,457) Miscellaneous revenues 8,847 31 8,878 Total Nonoperating Revenues 14,737 (1,830) 12,907 Change in Net Position 10,438 7,190 17,628 Net Position - January 1 65,446 178,961 244,407 Net Position, December 31 75,884$ 186,151$ 262,035$ City of Orono, Minnesota Combining Statement of Revenues, Expenses and Changes in Net Position Nonmajor Proprietary Funds For the Year Ended December 31, 2022 Business-type Activities - Enterprise Funds 117 163 Recycling Cable Television Total Cash Flows from Operating Activities Receipts from customers and users 233,449$ 26,062$ 259,511$ Other operating receipts 8,847 31 8,878 Payments to suppliers (234,449) (38,663) (273,112) Payments to employees (11,941) (26,641) (38,582) Net Cash Provided (Used) by Operating Activities (4,094) (39,211) (43,305) Cash Flows from Noncapital Financing Activities Intergovernmental receipts 8,486 - 8,486 Cash Flows from Investing Activities Investment receipts (loss)(2,739) (1,972) (4,711) Net Increase (Decrease) in Cash and Cash Equivalents 1,653 (41,183) (39,530) Cash and Cash Equivalents, January 1 65,436 45,333 110,769 Cash and Cash Equivalents, December 31 67,089$ 4,150$ 71,239$ Reconciliation of Operating Loss to Net Cash Provided (Used) by Operating Activities Operating loss (4,299)$ 9,020$ 4,721$ Adjustments to reconcile operating income (loss) to net cash provided (used) by operating activities Depreciation - 16,394 16,394 Other income related to operations 8,847 31 8,878 (Increase) decrease in assets/deferred outflows of resources Accounts receivable (6,159) - (6,159) Deferred pension resources 4,264 11,371 15,635 Increase (decrease) in liabilities/deferred inflows of resources Accounts and contracts payable 3,520 - 3,520 Unearned revenue - (46,898) (46,898) Net pension liability (1,257) (12,119) (13,376) Deferred pension resources (9,010) (17,010) (26,020) Net Cash Provided (Used) by Operating Activities (4,094)$ (39,211)$ (43,305)$ City of Orono, Minnesota Combining Statement of Cash Flows Nonmajor Proprietary Funds For the Year Ended December 31, 2022 Business-type Activities - Enterprise Funds 118 164 City of Orono, Minnesota General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual For the Year Ended December 31, 2022 Actual Variance with Original Final Amounts Final Budget Revenues Taxes 5,013,596$ 5,013,596$ 4,971,706$ (41,890)$ Licenses and permits 585,200 585,200 727,426 142,226 Intergovernmental 403,000 403,000 509,839 106,839 Charges for services 3,780,200 3,780,200 3,953,503 173,303 Fines and forfeitures 75,000 75,000 69,239 (5,761) Investment earnings (loss)80,500 80,500 (86,726) (167,226) Miscellaneous Rents and refunds 5,400 5,400 4,950 (450) Other 12,700 12,700 20,747 8,047 Total Revenues 9,955,596 9,955,596 10,170,684 215,088 Expenditures Current General government Administration 461,700 461,700 410,619 51,081 Election 68,370 68,370 61,200 7,170 Assessing 220,000 220,000 234,000 (14,000) Finance 279,150 279,150 338,824 (59,674) Legal 133,000 133,000 117,972 15,028 Human services 12,400 12,400 - 12,400 Central services 329,700 329,700 244,264 85,436 Total general government 1,504,320 1,504,320 1,406,879 97,441 Public safety Police 4,962,000 4,962,000 4,888,465 73,535 Fire 455,941 455,941 471,462 (15,521) Inspection and Zoning 786,925 786,925 735,902 51,023 Total public safety 6,204,866 6,204,866 6,095,829 109,037 Public works Streets 1,002,800 1,002,800 922,394 80,406 Parks and recreation Golf course 336,260 336,260 348,798 (12,538) Other 342,350 342,350 313,442 28,908 Total parks and recreation 678,610 678,610 662,240 16,370 Capital outlay Public safety 185,000 185,000 191,140 (6,140) Total Expenditures 9,575,596 9,575,596 9,278,482 297,114 Excess of Revenues Over Expenditures 380,000 380,000 892,202 512,202 Other Financing Sources (Uses) Proceeds from sale of capital assets 20,000 20,000 2,940 (17,060) Transfers out (400,000) (400,000) (300,000) 100,000 Total Other Financing Sources (Uses)(380,000) (380,000) (297,060) 82,940 Net Change in Fund Balances - - 595,142 595,142 Fund Balances, January 1 4,658,173 4,658,173 4,658,173 - Fund Balances, December 31 4,658,173$ 4,658,173$ 5,253,315$ 595,142$ Budget Amounts 119 165 THIS PAGE IS LEFT BLANK INTENTIONALLY 120 166 INTERNAL SERVICE FUNDS Internal Service funds are used to account for the financing of goods or services provided by one department to other departments of the City, on a cost reimbursement basis. Revenues are recognized in the accounting period in which they are earned and become objectively measurable; expenses are recognized in the period incurred, if objectively measurable. Insurance Fund was established 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 was established to account for the accrual of sick and vacation days that are earned by the City’s employees. Fleet Management Fund was established to account for the costs of repairs, maintenance, and supplies for the City’s various vehicles. IT Services was established to account for the cost of IT services to the various City functions and departments. 121 167 City of Orono, Minnesota Internal Service Funds Combining Statement of Net Position December 31, 2022 703 705 701 710 Insurance Compensated Fleet Fund Absences Management IT Services Total Assets Current Assets Cash and temporary investments 156,643$ 700,951$ (125,967)$ (228,869)$ 502,758$ Receivables Accrued interest 669 2,166 - - 2,835 Accounts - - 2 - 2 Prepaid items 8,000 - - 11,242 19,242 Total Assets 165,312 703,117 (125,965) (217,627) 524,837 Liabilities Current Liabilities Accounts and contracts payable - - 29 27,703 27,732 Accrued salaries payable 259 - - 1,433 1,692 Total Liabilities 259 - 29 29,136 29,424 Net Position Unrestricted 165,053$ 703,117$ (125,994)$ (246,763)$ 495,413$ 122 168 City of Orono, Minnesota Internal Service Funds Combining Statement of Revenues, Expenses and Changes in Net Position For the Year Ended December 31, 2022 703 705 701 710 Insurance Compensated Fleet Fund Absences Management IT Services Total Operating Revenues Charges for services 391,852$ -$ 8,172$ -$ 400,024$ Other 13,380 - 125,251 191,663 330,294 Total Operating Revenues 405,232 - 133,423 191,663 730,318 Operating Expenses Personnel services 260,135 - - 98,489 358,624 Supplies - - - 13,470 13,470 Professional services - - - 180,410 180,410 Repairs and maintenance - - 268,220 20,701 288,921 Insurance 217,306 - - - 217,306 Total Operating Expenses 477,441 - 268,220 313,070 1,058,731 Operating Income (Loss)(72,209) - (134,797) (121,407) (328,413) Nonoperating Revenues Investment earnings (loss)(8,975) (26,232) (67) (348) (35,622) Change in Net Position (81,184) (26,232) (134,864) (121,755) (364,035) Net Position, January 1 246,237 729,349 8,870 (125,008) 859,448 Net Position, December 31 165,053$ 703,117$ (125,994)$ (246,763)$ 495,413$ 123 169 City of Orono, Minnesota Internal Service Funds Combining Statement of Cash Flows For the Year Ended December 31, 2022 703 705 701 710 Insurance Compensated Fleet Fund Absences Management IT Services Total Cash Flows from Operating Activities Receipts from customers and users 405,232$ -$ 133,421$ 191,663$ 730,316$ Payments to suppliers (217,306) - (275,782) (175,758) (668,846) Payments to employees (260,135) - - (98,489) (358,624) Net Cash Provided (Used) by Operating Activities (72,209) - (142,361) (82,584) (297,154) Cash Flows from Investing Activities Investment receipts (loss)(9,288) (27,713) (113) (212) (37,326) Net Increase (Decrease) in Cash and Cash Equivalents (81,497) (27,713) (142,474) (82,796) (334,480) Cash and Cash Equivalents, January 1 238,140 728,664 16,507 (146,073) 837,238 Cash and Cash Equivalents, December 31 156,643$ 700,951$ (125,967)$ (228,869)$ 502,758$ Reconciliation of Operating Income (Loss) to Net Cash Provided (Used) by Operating Activities Operating income (loss)(72,209)$ -$ (134,797)$ (121,407)$ (328,413)$ Adjustments to reconcile operating income (loss) to net cash provided (used) by operating activities (Increase) decrease in assets Interest Receivable - - (2) - (2) Prepaid items - - - 25,674 25,674 Increase (decrease) in liabilities Accounts and contracts payable - - (7,562) 13,149 5,587 Net Cash Provided (Used) by Operating Activities (72,209)$ -$ (142,361)$ (82,584)$ (297,154)$ 124 170 STATISTICAL SECTION (UNAUDITED) CITY OF ORONO, MINNESOTA FOR THE YEAR ENDED DECEMBER 31, 2022 125 171 THIS PAGE IS LEFT BLANK INTENTIONALLY 126 172 STATISTICAL SECTION (UNAUDITED) This part of the City’s annual comprehensive financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City’s overall financial health. Contents Pages Financial Trends 129 - 138 These schedules contain trend information to help the reader understand how the government’s financial performance and well-being have changed over time. Revenue Capacity 140 - 143 These schedules contain information to help the reader assess the City’s most significant local revenue source, property taxes. Debt Capacity 144 - 150 These schedules present information to help the reader assess the affordability of the City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future. Demographic and Economic Information 151 - 153 These schedules offer demographic and economic indicators to help the reader understand the environment within which the City’s financial activities take place. Operating Information 154 - 158 These schedules contain service and infrastructure data to help the reader understand how the information in the City’s financial report relates to the services the City provides and the activities it performs. Sources: Unless otherwise noted, the information in these schedules is derived from the annual financial reports for the relevant year. 127 173 THIS PAGE IS LEFT BLANK INTENTIONALLY 128 174 City of Orono, Minnesota Summary Financial Report Governmental Funds Revenues and Expenditures For General Operations For the Years Ended December 31, 2022 and 2021 2022 2021 Revenues Taxes 7,014,703$ 6,691,522$ 4.83 % Special assessments 24,446 35,759 (31.64) Licenses and permits 734,843 781,642 (5.99) Intergovernmental 1,475,319 1,048,012 40.77 Charges for services 4,121,474 3,941,998 4.55 Fines and forfeits 83,741 244,444 (65.74) Investment earnings (loss)(287,118) (6,927) N/A Miscellaneous 128,852 52,371 146.04 Total Revenues 13,296,260$ 12,788,821$ 3.97 % Per Capita 1,567$ 1,538$ 1.88 % Expenditures Current General government 1,406,879$ 1,348,363$ 4.34 % Public safety 6,096,418 5,857,388 4.08 Public works 922,394 811,636 13.65 Parks and recreation 724,281 636,267 13.83 Community development 46,406 59,265 (21.70) Capital outlay Public safety 191,140 305,671 (37.47) Public works 2,279,810 2,054,964 10.94 Parks and recreation 62,880 531,906 (88.18) Debt service Principal 735,000 2,150,000 (65.81) Interest and other charges 460,111 87,476 425.99 Bond issuance costs - 325,901 (100.00) Total Expenditures 12,925,319$ 14,168,837$ (8.78) % Per Capita 1,523$ 1,704$ (10.60) Total Long-term Indebtedness 18,326,006$ 19,130,963$ (4.21) % Per Capita 2,160 2,301 (6.13) General Fund Balance - December 31 5,253,315$ 4,658,173$ 12.78 % Per Capita 619 560 10.52 Total Percent Increase (Decrease) The purpose of this report is to provide a summary of financial information concerning the City of Orono to interested citizens. The complete financial statements may be examined at City Hall, 2750 Kelley Parkway, P.O. Box 66, Crystal Bay, Minnesota 55323. Questions about this report should be directed to the Finance Department at (952) 249-4600. 129 175 City of Orono, Minnesota Statistical Section (Unaudited) Net Position by Component Last Ten Fiscal Years (Accrual Basis of Accounting) 2013 2014 2015 2016 Governmental Activities Net investment in capital assets 10,855,727$ 10,720,258$ 14,269,848$ 16,660,990$ Restricted 3,596,762 3,535,595 3,835,852 9,046,977 Unrestricted 7,777,232 9,616,862 3,740,883 (3,794,950) Total Governmental Activities Net Position 21,812,921$ 22,229,721$ 23,872,715$ 21,846,583$ Business-type Activities Net investment in capital assets 15,586,266$ 16,042,333$ 15,505,885$ 16,427,467$ Unrestricted 6,105,512 5,946,733 6,411,818 6,001,307 Total Business-type Activities Net Position 21,691,778$ 21,989,066$ 21,917,703$ 22,428,774$ Total Primary Government Net investment in capital assets 26,441,993$ 26,762,591$ 29,775,733$ 33,088,457$ Restricted 3,596,762 3,535,595 3,835,852 9,046,977 Unrestricted 13,882,744 15,563,595 10,152,701 2,206,357 Total Primary Government Net Position 43,921,499$ 45,861,781$ 43,764,286$ 44,341,791$ Fiscal Year Note: The City implemented GASB Statement No. 63 and GASB Statement No. 65 in fiscal 2013. The City implemented GASB Statement No. 68 and GASB Statement No. 67 in fiscal 2015. Years prior to 2015 have not been restated. The City implemented GASB Statement No. 75 in fiscal 2018. Years prior to 2018 have not been restated. 130 176 2017 2018 2019 2020 2021 2022 19,020,035$ 23,370,988$ 25,500,646$ 28,256,953$ 31,430,458$ 33,174,764$ 3,699,095 3,434,418 2,418,794 2,252,227 1,767,721 1,409,778 894,132 (840,224) 1,122,484 (116,070) (544,720) (828,174) 21,913,017$ 23,613,262$ 25,965,182$ 29,041,924$ 30,393,110$ 33,756,368$ 16,940,333$ 17,917,465$ 18,679,663$ 18,910,474$ 19,404,787$ 20,387,984$ 5,687,684 5,086,696 4,389,380 4,774,995 5,873,484 6,340,316 22,628,017$ 23,004,161$ 23,069,043$ 23,685,469$ 25,278,271$ 26,728,300$ 35,960,368$ 41,288,453$ 44,180,309$ 47,167,427$ 50,835,245$ 53,562,748$ 3,699,095 3,434,418 3,202,919 2,867,209 3,075,294 2,704,755 6,581,816 4,246,472 5,511,864 4,658,925 5,328,764 5,512,142 46,241,279$ 48,969,343$ 52,895,092$ 54,693,561$ 59,239,303$ 61,779,645$ Fiscal Year 131 177 City of Orono, Minnesota Statistical Section (Unaudited) Changes in Net Position (Continued on the Following Pages) Last Ten Fiscal Years (Accrual Basis of Accounting) 2013 2014 2015 2016 Expenses Governmental activities General government 1,931,772$ 1,719,267$ 1,864,543$ 2,314,539$ Public safety 4,526,574 4,984,389 5,107,619 6,263,133 Public works 1,610,302 854,079 999,097 752,976 Culture and recreation 279,796 254,177 324,731 413,797 Recycling - - - - Interest on long-term debt 413,935 287,181 283,146 258,874 Total Governmental Activities Expenses 8,762,379 8,099,093 8,579,136 10,003,319 Business-type activities Water 514,522 556,766 581,758 634,562 Sewer 1,136,040 1,184,629 1,332,617 1,401,278 Storm water 145,907 186,719 163,747 225,113 Recycling 114,837 114,983 116,642 118,054 Cable television - 12,675 31,802 31,724 Interest and fiscal charges 899 - - - Total Business-type Activities Expenses 1,912,205 2,055,772 2,226,566 2,410,731 Total Primary Government Expenses 10,674,584$ 10,154,865$ 10,805,702$ 12,414,050$ Program Revenues Governmental activities Charges for services General government 646,284$ 692,254$ 736,643$ 770,750$ Public safety 2,544,587 2,570,751 2,737,342 2,720,584 Public works 128,402 2,998 3,933 5,108 Culture and recreation 149,994 207,977 499,083 420,184 Operating grants and contributions 627,650 925,968 732,114 671,059 Capital grants and contributions 11,187 22,060 13,549 1,070 Total Governmental Activities Program Revenues 4,108,104 4,422,008 4,722,664 4,588,755 Business-type activities Charges for services Water 436,770 452,429 492,947 594,198 Sewer 1,206,926 1,200,043 1,297,786 1,505,467 Storm water 314,415 318,787 527,255 538,870 Recycling 110,912 113,501 128,387 142,470 Cable television - 71,412 99,632 77,511 Operating grants and contributions - 34,500 34,500 34,500 Capital grants and contributions 495 178,371 16,765 - Total Business-type Activities Program Revenues 2,069,518 2,369,043 2,597,272 2,893,016 Total Primary Government Program Revenues 6,177,622$ 6,791,051$ 7,319,936$ 7,481,771$ Fiscal Year 132 178 2017 2018 2019 2020 2021 2022 2,722,779$ 1,947,411$ 818,147$ 1,865,451$ 1,572,281$ 2,028,478$ 5,486,330 5,661,624 5,422,838 6,361,790 5,445,046 6,607,975 393,354 2,131,198 946,735 1,946,959 1,705,585 2,084,036 420,410 465,170 535,357 696,274 731,394 832,389 - - 141,722 111,781 59,265 46,406 173,552 155,122 150,164 138,240 359,970 543,012 9,196,425 10,360,525 8,014,963 11,120,495 9,873,541 12,142,296 680,595 915,730 984,452 1,044,516 1,110,702 1,170,772 1,429,209 1,381,752 1,538,449 1,743,277 1,676,642 1,974,089 190,935 143,194 433,908 354,524 310,626 443,573 126,333 127,044 173,049 227,227 232,165 244,021 48,684 51,943 90,586 91,128 100,970 64,010 - - - - - - 2,475,756 2,619,663 3,220,444 3,460,672 3,431,105 3,896,465 11,672,181$ 12,980,188$ 11,235,407$ 14,581,167$ 13,304,646$ 16,038,761$ 947,851$ 1,147,449$ 966,665$ 984,876$ 1,225,915$ 1,168,166$ 2,947,439 3,102,546 2,656,733 2,607,888 2,798,742 2,772,525 385 5,826 881,011 638,149 849,480 1,118,347 195,449 389,206 86,501 11,711 175,232 120,403 1,174,782 1,741,370 419,114 976,217 550,474 493,022 609 820,165 649,359 617,082 273,445 763,475 5,266,515 7,206,562 5,659,383 5,835,923 5,873,288 6,435,938 629,736 699,562 871,125 1,257,201 1,616,435 1,818,457 1,408,480 1,477,225 1,600,046 1,902,088 2,232,546 2,294,626 289,643 421,838 361,199 701,562 715,037 741,332 140,218 136,922 131,013 212,038 234,732 248,455 76,352 78,716 80,237 79,588 74,787 72,991 - 34,500 21,058 - 15,982 468,486 45,218 7,400 253,370 6,050 364,815 44,627 2,589,647 2,856,163 3,318,048 4,158,527 5,254,334 5,688,974 7,856,162$ 10,062,725$ 8,977,431$ 9,994,450$ 11,127,622$ 12,124,912$ Fiscal Year 133 179 City of Orono, Minnesota Statistical Section (Unaudited) Changes in Net Position (Continued) Last Ten Fiscal Years (Accrual Basis of Accounting) 2013 2014 2015 2016 Net Revenues (Expenses) Governmental activities (4,654,275)$ (3,677,085)$ (3,856,472)$ (5,414,564)$ Business-type activities 157,313 313,271 370,706 482,285 Total Primary Government Net Revenues (Expenses)(4,496,962)$ (3,363,814)$ (3,485,766)$ (4,932,279)$ General Revenues and Other Changes in Net Position Governmental activities Taxes Property taxes 4,746,856$ 4,809,875$ 4,819,345$ 5,021,340$ Tax increments - - - - Grants and contributions not restricted to specific programs - - - - Other general revenues 214,876 17,337 44,051 149,388 Unrestricted investment earnings (loss)(81,067) 215,606 144,252 109,752 Gain on sale of capital assets 24,410 7,961 6,466 45,518 Transfers 166,000 269,300 320,209 155,000 Total Governmental Activities 5,071,075 5,320,079 5,334,323 5,480,998 Business-type activities Other general revenues 130,550 163,719 141,546 160,967 Unrestricted investment earnings (loss)(19,708) 124,098 67,076 57,319 Transfers (166,000) (269,300) (320,209) (155,000) Total Business-type Activities (55,158) 18,517 (111,587) 63,286 Total Primary Government 5,015,917$ 5,338,596$ 5,222,736$ 5,544,284$ Change in Net Position Governmental activities 416,800$ 1,642,994$ 1,477,851$ 66,434$ Business-type activities 102,155 331,788 259,119 545,571 Total Primary Government 518,955$ 1,974,782$ 1,736,970$ 612,005$ Note: The City implemented GASB Statement No. 63 and GASB Statement No. 65 in fiscal 2013. The City implemented GASB Statement No. 68 and GASB Statement No. 67 in fiscal 2015. Years prior to 2015 have not been restated. The City implemented GASB Statement No. 75 in fiscal 2018. Years prior to 2018 have not been restated. Fiscal Year 134 180 2017 2018 2019 2020 2021 2022 (3,929,910)$ (3,153,963)$ (2,355,580)$ (5,284,572)$ (4,000,253)$ (5,706,358)$ 113,891 236,500 97,604 697,855 1,823,229 1,792,509 (3,816,019)$ (2,917,463)$ (2,257,976)$ (4,586,717)$ (2,177,024)$ (3,913,849)$ 5,268,854$ 5,510,133$ 5,630,633$ 5,999,083$ 6,551,553$ 6,779,524$ - - 76,344 82,686 145,895 187,356 - - 26,372 5,321 1,784 16,817 53,207 193,279 - - - - 114,356 132,799 259,332 173,308 (6,927) (287,466) 38,738 - 63,105 36,217 48,388 2,940 155,000 (41,000) 160,661 170,000 212,500 97,500 5,630,155 5,795,211 6,216,447 6,466,615 6,953,193 6,796,671 185,909 79,683 - - - - 54,443 51,588 127,939 88,571 (17,927) (244,980) (155,000) 41,000 (160,661) (170,000) (212,500) (97,500) 85,352 172,271 (32,722) (81,429) (230,427) (342,480) 5,715,507$ 5,967,482$ 6,183,725$ 6,385,186$ 6,722,766$ 6,454,191$ 1,700,245$ 2,641,248$ 3,860,867$ 1,182,043$ 2,952,940$ 1,090,313$ 199,243 408,771 64,882 616,426 1,592,802 1,450,029 1,899,488$ 3,050,019$ 3,925,749$ 1,798,469$ 4,545,742$ 2,540,342$ Fiscal Year 135 181 City of Orono, Minnesota Statistical Section (Unaudited) Fund Balances of Governmental Funds Last Ten Fiscal Years (Modified Accrual Basis of Accounting) 2013 2014 2015 2016 General Fund Nonspendable 30,909$ 40,532$ 74,800$ 25,376$ Unassigned 3,354,809 3,886,128 4,233,687 4,400,222 Total General Fund 3,385,718$ 3,926,660$ 4,308,487$ 4,425,598$ All Other Governmental Funds Restricted 3,455,223$ 3,625,599$ 3,957,346$ 6,383,149$ Committed - - - - Assigned 4,133,893 4,029,776 2,951,616 3,358,915 Unassigned - - (178,573) (872,147) Total All Other Governmental Funds 7,589,116$ 7,655,375$ 6,730,389$ 8,869,917$ Fiscal Year 136 182 2017 2018 2019 2020 2021 2022 13,277$ 118,170$ 119,157$ 30,343$ 40,670$ 33,771$ 4,433,559 4,336,396 4,288,536 4,516,690 4,619,903 5,219,544 4,446,836$ 4,454,566$ 4,407,693$ 4,547,033$ 4,660,573$ 5,253,315$ 3,685,145$ 3,495,176$ 3,250,008$ 2,908,430$ 18,561,508$ 18,046,016$ - - 16,741 36,329 38,712 64,885 3,148,848 2,403,358 2,721,806 2,773,589 3,245,236 3,217,483 (1,050,959) (2,759,730) (2,676,572) (3,111,513) (4,484,366) (4,088,655) 5,783,034$ 3,138,804$ 3,311,983$ 2,606,835$ 17,361,090$ 17,239,729$ Fiscal Year 137 183 City of Orono, Minnesota Statistical Section (Unaudited) Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years (Modified Accrual Basis of Accounting) 2013 2014 2015 2016 Revenues Taxes 4,785,052$ 4,840,777$ 4,839,722$ 5,057,941$ Licenses and permits 613,184 675,204 846,343 715,281 Intergovernmental 421,485 745,062 545,236 496,497 Charges for services 2,474,211 2,569,831 2,896,458 2,973,534 Fines and forfeitures 175,321 153,821 134,754 133,354 Investment earnings 61,335 195,862 133,204 97,843 Special assessments 68,413 62,632 70,349 8,537 Miscellaneous 205,078 58,012 64,867 143,976 Total Revenues 8,804,079 9,301,201 9,530,933 9,626,963 Expenditures Current General government 1,242,028 1,282,487 1,285,064 1,362,293 Public safety 4,734,635 4,906,572 4,906,117 5,073,430 Streets 508,544 454,964 496,239 480,765 Culture and recreation 255,395 231,356 268,831 281,340 Community development - - - - Recycling - 4,572 - - Capital outlay 1,683,159 3,973,460 2,114,343 1,721,077 Debt service Principal 1,145,000 1,900,000 1,010,000 1,085,788 Interest and other charges 328,633 302,728 331,317 344,562 Bond issuance costs - - - - Total Expenditures 9,897,394 13,056,139 10,411,911 10,349,255 Deficiency of Revenues under expenditures (1,093,315) (3,754,938) (880,978) (722,292) Other Financing Sources (Uses) Transfers in 866,000 905,848 1,451,397 1,565,385 Transfers out (700,000) (636,548) (1,131,188) (1,410,385) Bond proceeds - 4,070,177 - - Premium on bonds issued - - - 94,956 Refunding bonds issued - - - 2,680,000 Sale of capital assets 30,110 22,662 17,610 48,975 Total Other Financing Sources (Uses)196,110 4,362,139 337,819 2,978,931 Net Change in Fund Balances (897,205)$ 607,201$ (543,159)$ 2,256,639$ Debt Service as a Percentage of Noncapital Expenditures 20.10%16.50%24.20%15.80% Fiscal Year (1) The Water Revenue Bonds and Sewer Revenue Bonds debt service funds and the Water Connection, Sewer Connection, and Water System Improvements capital projects funds were reclassified from governmental to enterprise (business-type) in 2013. 138 184 2017 2018 2019 2020 2021 2022 5,258,546$ 5,448,238$ 5,709,173$ 6,043,234$ 6,691,522$ 7,014,703$ 613,218 954,278 742,042 502,714 781,642 734,843 1,025,044 1,616,583 966,874 1,439,511 1,048,012 1,475,319 3,165,196 3,211,749 3,647,122 3,578,117 3,941,998 4,121,474 101,824 124,060 299,661 72,428 244,444 83,741 105,079 122,659 259,332 173,308 (6,927) (287,118) 2,226 22,935 22,783 35,881 35,759 24,446 66,122 171,219 73,649 141,544 52,371 128,852 10,337,255 11,671,721 11,720,636 11,986,737 12,788,821 13,296,260 1,474,265 1,433,076 1,271,893 1,732,325 1,348,363 1,406,879 5,298,939 5,628,086 5,446,200 5,599,888 5,857,388 6,096,418 486,138 595,740 773,965 1,089,733 811,636 922,394 304,333 421,996 480,870 570,346 636,267 724,281 - - 141,722 111,781 59,265 46,406 1,590 - - - - - 2,150,260 5,771,819 2,607,061 2,568,670 2,892,541 2,533,830 3,556,024 660,000 890,000 925,000 2,150,000 735,000 237,286 187,404 184,385 164,613 87,476 460,111 - - - - 325,901 - 13,508,835 14,698,121 11,796,096 12,762,356 14,168,837 12,925,319 (3,171,580) (3,026,400) (75,460) (775,619) (1,380,016) 370,941 1,262,405 1,486,307 1,678,274 570,000 1,195,797 397,500 (1,107,405) (1,217,307) (1,517,613) (400,000) (983,297) (300,000) - - - - 15,350,000 - - - - - 653,923 - - - - - - - 38,738 33,097 41,105 39,811 31,388 2,940 193,738 302,097 201,766 209,811 16,247,811 100,440 (2,977,842)$ (2,724,303)$ 126,306$ (565,808)$ 14,867,795$ 471,381$ 16.40%33.70%8.60%10.92%19.31%11.32% Fiscal Year 139 185 City of Orono, Minnesota Statistical Section (Unaudited) Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years Fiscal Year Total Taxable Ended Residential Commercial Industrial Total Assessed Total Direct December 31, (1)Property Property Property Market Value Value Tax Rate 2013 2,353,751,300$ 53,032,100$ 9,618,500$ 2,416,401,900$ 26,531,505$ 17.667 1.10 % 2014 2,367,078,691 52,385,700 11,937,300 2,431,401,691 27,566,309 17.815 1.13 2015 2,468,589,098 50,003,300 12,831,100 2,531,423,498 28,749,183 17.387 1.14 2016 2,664,593,042 51,885,300 14,602,600 2,731,080,942 28,351,935 17.352 1.04 2017 2,810,505,878 53,590,300 15,428,800 2,879,524,978 32,961,379 16.759 1.14 2018 2,932,517,796 49,881,300 20,720,700 3,003,119,796 34,422,178 16.555 1.15 2019 3,094,297,060 54,320,300 21,603,800 3,170,221,160 36,465,048 16.406 1.15 2020 3,335,498,959 62,889,100 19,996,200 3,418,384,259 39,482,429 16.512 1.16 2021 3,335,498,959 62,889,100 19,996,200 3,418,384,259 39,029,347 16.780 1.14 2022 3,504,086,699 62,576,300 19,758,800 3,586,421,799 41,490,542 16.820 1.16 Source: Hennepin County Assessor. (1) Represents the year the taxes are payable, not the year the taxes are levied. Real Property Tax Capacity Actual Value Percentage of Value as a Assessed 140 186 City of Orono, Minnesota Statistical Section (Unaudited) Property Tax Rates - Direct and Overlapping Governments Last Ten Fiscal Years Fiscal Special Year Districts 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 2019 14.336 2.070 16.406 23.552 41.861 10.119 91.938 2020 14.557 1.955 16.512 23.109 41.084 9.712 90.417 2021 15.309 1.471 16.780 22.657 38.210 9.235 86.882 2022 14.758 2.062 16.820 23.903 38.535 9.217 88.475 Source: Hennepin County Assessing Department Rates School Overlapping Direct & No. 278 County District City of Orono Hennepin Total Millage RateMillage Operating Debt Service Total Direct 141 187 City of Orono, Minnesota Statistical Section (Unaudited) Principal Property Taxpayers Current and Nine Years Ago Net Net Tax Tax Taxpayer Capacity Rank Capacity Rank 323,000$ 1 0.78 %–$ - % Private Residence 201,650 2 0.49 207,813 1 0.71 188,275 3 0.45 128,338 2 0.44 Private Residence 164,250 4 0.40 - 155,490 5 0.37 109,551 3 0.38 150,600 6 0.36 – - 128,730 7 0.31 97,010 7 0.33 143,188 8 0.35 108,525 4 0.37 120,238 9 0.29 104,525 5 0.36 Private Residence 119,847 10 0.29 – - - 0.00 104,213 6 0.36 Private Residence - 0.00 91,888 8 0.32 Private Residence - 0.00 86,838 9 0.30 - 0.00 94,439 10 0.32 Total 1,695,268$ 4.09 %1,133,140$ 3.89 % Source: Hennepin County Assessor's Office Private Residence Private Residence Private Residence Private Residence WJM Properties LLC 1725 Bohns Point LLC Private Residence Metro Storage Brackett Point Property LLC Tax Capacity Tax Capacity 2022 2013 Percent of Percent of Total Net Total Net 142 188 City of Orono, Minnesota Statistical Section (Unaudited) Property Tax Levies and Collections Last Ten Fiscal Years Total Tax Collection Collection Fiscal Levy for of Current of Prior Total Year Fiscal Year Year's Levy Years' Levy Collections 2013 4,701,750$ 4,677,698$ 99.49 24,062$ 4,701,760$ 100.00 % 2014 4,743,144 4,701,760 99.13 41,384 4,743,144 100.00 2015 4,772,000 4,748,327 99.50 23,673 4,772,000 100.00 2016 4,954,480 4,968,026 *100.27 (13,546) 4,954,480 100.00 2017 5,205,230 5,235,100 *100.57 (29,870) 5,205,230 100.00 2018 5,439,951 5,379,375 98.89 60,576 5,439,951 100.00 2019 5,816,338 5,771,646 99.23 44,692 5,816,338 100.00 2020 6,007,450 5,935,931 98.81 36,104 5,972,035 99.49 2021 6,610,682 6,556,718 99.18 22,799 6,579,517 99.53 2022 6,944,776 6,897,016 99.31 -6,897,016 99.31 Source: Hennepin County Treasurer - Auditor. * In 2016 and 2017 the City collected slightly more taxes than they levied for as some residents chose to prepay their property taxes. Collected to Levy Percentage Percentage of Total of Levy Collections 143 189 City of Orono, Minnesota Statistical Section (Unaudited) Ratios of Outstanding Debt by Type Last Ten Fiscal Years General General Total Fiscal Obligation (G.O.)Public Facility Capital Obligation (G.O.)Primary Per Year Bonds Bonds Leases Bonds Government Capita 2013 7,470,000$ 1,055,000$ 5,682$ -$ 8,530,682$ 1.46 1,125$ 2014 10,620,000 - 17,374 1,280,000 11,917,374 1.99 1,566 2015 9,610,000 - 11,812 1,195,000 10,816,812 2.14 1,389 2016 11,431,701 - 6,024 1,138,557 12,576,282 1.84 1,635 2017 7,660,000 - - 1,045,000 8,705,000 1.20 1,068 2018 7,000,000 - - 965,000 7,965,000 1.03 983 2019 6,110,000 - - 885,000 6,995,000 0.84 846 2020 5,185,000 - - 805,000 5,990,000 0.70 747 2021 18,465,000 - - 725,000 19,110,000 2.22 2,359 2022 17,650,000 - - 640,000 18,290,000 2.13 2,258 Details regarding the City's outstanding debt can be found in the notes to the financial statements. See the Schedule of Demographic and Economic Statistics for personal income and population data. Percentage of Personal Income Business-type Governmental Activities 144 190 City of Orono, Minnesota Statistical Section (Unaudited) Ratios of General Bonded Debt Outstanding Last Ten Fiscal Years Governmental Business-type Activities Activities Less General General Amounts Net Fiscal Obligation Obligation Restricted for Bonded Year Bonds Bonds Debt Service Debt Per Capita (2) 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 0.20 746 2019 6,110,000 885,000 3,250,008 2,859,992 0.09 353 2020 5,185,000 805,000 2,908,430 2,276,570 0.07 275 2021 18,385,000 725,000 1,666,201 15,295,131 0.45 1,839 2021 17,650,000 640,000 1,506,830 16,143,170 0.45 1,903 Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements. (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. Estimated Market Value of Taxable Property (1) Percentage of 145 191 THIS PAGE IS LEFT BLANK INTENTIONALLY 146 192 Estimated Share Total Debt of Overlapping Outstanding Sinking Funds Net Debt Debt Direct Debt: City of Orono $2,300,000 $876,100 $1,423,900 100.00 %1,423,900$ ISD No. 276 (Minnetonka)115,160,000 1,881,724 113,278,276 0.25 283,196 ISD No. 277 (Westonka)30,120,000 794,441 29,325,559 25.63 7,516,141 ISD No. 278 (Orono)55,565,000 3,335,715 52,229,285 52.91 27,634,515 ISD No. 284 (Wayzata)212,485,000 16,452,753 196,032,247 0.89 1,744,687 Hennepin County 1,027,985,000 9,098,977 1,018,886,023 2.03 20,683,386 Hennepin Suburban Park 53,865,000 6,214,099 47,650,901 2.81 1,338,990 Hennepin Regional RR Authority 86,235,000 770,202 85,464,798 2.03 1,734,935 Metropolitan Council 218,520,000 135,460,603 83,059,397 1.10 913,653 1,799,935,000 174,008,514 1,625,926,486 61,849,503 63,273,403$ (1) Note 1: Note: Source 1: Source 2: Overlapping Debt: Applicable Percentage Governmental Unit City of Orono, Minnesota Direct and Overlapping Governmental Activities Debt as of December 31, 2022 Estimated Statistical Section (Unaudited) Hennepin County Total Overlapping Debt Assessed value data used to estimate applicable percentages provided by the County Board of Equalization and Assessment. Debt outstanding data provided by the county. 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. 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. Excludes revenue and special assessment bonds. Total Direct and Overlapping Debt 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. 147 193 City of Orono, Minnesota Statistical Section (Unaudited) Legal Debt Margin Information Last Ten Fiscal Years 2013 2014 2015 2016 Debt Limit 72,492,057$ 72,942,051$ 75,942,705$ 81,932,428$ Total Net Debt Applicable to Limit 6,319,308 10,660,892 8,714,780 8,062,670 Legal Debt Margin 66,172,749$ 62,281,159$ 67,227,925$ 73,869,758$ Total Net Debt Applicable to the Limit as a Percent of Debt Limit 8.72%14.62%11.48%9.84% Fiscal Year Note: Under state law, the City's outstanding general obligation debt should not exceed 3 percent of the market value of taxable property. Net debt is payable solely from ad valorem taxes and, therefore, excludes debt financed partially or entirely by special assessments, enterprise fund revenues, or tax increments. Prior to 2008, state law provided that general obligation debt should not exceed 2 percent. By law, the general obligation debt subject to the limitation may be offset by amounts set aside for the extinguishment of those obligations. 148 194 2017 2018 2019 2020 2021 2022 86,385,749$ 90,093,594$ 95,106,635$ 102,551,528$ 102,551,528$ 107,592,654$ 8,705,000 5,884,077 4,842,172 3,849,458 17,443,799 17,390,498 77,680,749$ 84,209,517$ 90,264,463$ 98,702,070$ 85,107,729$ 90,202,156$ 10.08%6.53%5.09%3.75%17.01%16.16% Taxable Market Value 3,586,421,799$ Debt Limit (3 Percent of Market Value)107,592,654$ Debt Applicable to Limit General obligation bonds 18,290,000 Less: amount available in debt service funds (899,502) Total Net Debt Applicable to Limit 17,390,498 Legal Debt Margin 90,202,156$ Fiscal Year Legal Debt Margin Calculation for Fiscal Year 2020 149 195 City of Orono, Minnesota Statistical Section (Unaudited) Pledged Revenue Coverage Last Ten Fiscal Years Water Less Net Fiscal Charges Operating Available Year and other (2)Expense (1)Revenue Principal (5)Interest Total 2015 615,569$ 577,320$ 38,249$ 85,000$ 31,680$ 116,680$ 33.00 % 2016 706,460 624,253 82,207 75,000 74,044 149,044 55.00 2017 746,514 643,048 103,466 75,000 25,181 100,181 103.00 2018 714,159 818,330 (104,171) 80,000 21,480 101,480 (103.00) 2019 854,551 782,665 71,886 80,000 22,031 102,031 70.46 2020 1,254,730 883,550 371,180 80,000 20,431 100,431 3.70 2021 1,605,511 866,330 739,181 80,000 18,831 98,831 747.92 2022 1,799,535 927,170 872,365 85,000 17,181 102,181 853.74 Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements. Note: Information prior to 2015 is not available or not existant. Debt Service Water G.O. Revenue Bonds Coverage 150 196 City of Orono, Minnesota Statistical Section (Unaudited) Demographic and Economic Statistics Last Ten Fiscal Years Education Per Capita Level in Years School Fiscal Population Personal Personal Median of Formal Enrollment Year (1)Income Income Age (2)Schooling (3) 2013 7,584 584,726,400$ 77,100$ 46 - 2,760 4.8 % 2014 7,611 597,463,500 78,500 46 - 2,757 2.9 2015 7,785 506,281,905 65,033 46 - 2,808 2.8 2016 7,691 685,014,271 89,067 43 - 2,790 3.3 2017 8,147 724,455,244 89,923 47 - 2,807 2.6 2018 7,883 770,192,324 95,062 47 - 2,820 2.5 2019 8,102 838,995,236 101,279 47 - 2,850 2.5 2020 8,015 850,888,430 106,162 48 - 2,834 4.2 2021 8,315 859,912,200 106,162 48 - 2,850 2.3 2022 8,485 1,068,545,500 126,500 45 - 2,885 4.2 Note: Information on education level was only available in 2010 census data. Data sources (1)Metropolitan Council Estimate in 2022 Estimated, publiclished 7/2023 (2)Based on Metropolitan Council's estimate - numbers are delayed by a year. (3)Hennepin County average/median for non-census years. (4)Minnesota Department of Education, as reported by ISD No. 278 (Orono). (5)Minnesota Department of Economic Security; Hennepin County average for non-census years. Rate (4) Unemployment 151 197 THIS PAGE IS LEFT BLANK INTENTIONALLY 152 198 City of Orono, Minnesota Statistical Section (Unaudited) Principal Employers Current Year and Nine Years Ago Employees Rank Employees Rank ISD No. 278 (Orono)298 1 16.56 %460 1 26.29 % Woodhill Country Club 125 2 6.94 %144 3 8.23 % Wayzata Country Club 180 3 10.00 %230 2 13.14 % Jem Technical 120 4 6.67 %115 4 6.57 % Springhill Country Club 120 5 6.67 %80 6 4.57 % Otten Brothers 100 6 5.56 %98 5 5.60 % Lunds 60 7 3.33 %75 7 4.29 % City of Orono 64 8 3.56 %60 9 2.86 % Culver's 50 9 2.78 %45 8 2.46 % Trails of Orono 40 10 2.22 %- - - Service 800 - - - 30 10 1.71 % Morries' Automotive - - - 30 11 1.71 % Total 1,157 64.29 %1,367 77.43 % Source: City of Orono and State Department of Commerce and Employers *Total W-2's sent out, which includes part-time and seasonal employees. 2022 2013 Employment Employment Percent Percent of City of City 153 199 City of Orono, Minnesota Statistical Section (Unaudited) Full-time Equivalent Employees by Function Last Ten Fiscal Years 2013 2014 2015 2016 General Government 7 7 8 8 Public Safety Police Officers 30 28 27 27 Civilians 4 4 4 4 Code Enforcement 6 6 6 5 Public Works 5 5 5 5 Parks (1)- - - - Water 2 2 2 2 Sewer 3 3 3 3 Storm Water 1 1 1 1 Golf 3 5 5 5 Total 59 59 59 58 Source: City budgets and personnel records. (1) Separated Parks department in 2018 due to hiring Park Supervisor at the end of 2017 Function Note: This table shows 61 employees while the Prinicipal Employers schedule shows 54 due to their part time employees included within the table above. 154 200 2017 2018 2019 2020 2021 2022 8 8 8 7 7 8 27 30 30 30 29 33 4 4 4 4 4 4 4 5 5 5 4 6 5 5 5 5 5 4 - 1 1 1 2 4 2 3 3 3 3 3 3 3 3 3 3 3 1 1 1 1 1 1 5 3 3 3 1 1 57 61 61 60 59 67 155 201 City of Orono, Minnesota Statistical Section (Unaudited) Operating Indicators by Function Last Ten Fiscal Years 2013 2014 2015 2016 Public Safety Police Initial reports 12,128 10,990 10,056 9,320 Citations 3,228 2,437 1,495 1,929 Building/Zoning Building permits issued 449 485 470 466 Land use applications 24 56 63 59 Water New connections 1,036 1,036 1,023 1,036 Radio read meters - start 2004 1,001 1,036 1,010 1,024 Annual water pumped (thousands of gallons)108,486 96,006 95,701 96,936 Waste Water New connections 2,225 2,218 2,238 2,243 Annual sewer flow (thousands of gallons) (2)186,310 190,710 201,000 211,900 Storm Water Sweeping (centerline Miles) (1)46 46 46 46 Drainage projects 1 1 1 3 Golf Rounds played 6,990 10,890 14,334 11,976 Sources: City department records. (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)Data received from Metropolitan Council. Function 156 202 2017 2018 2019 2020 2021 2022 6,462 5,875 4,997 4,496 4,582 11,850 1,509 1,675 1,331 907 1,064 1,373 518 535 660 442 460 425 110 81 95 77 62 14 1,041 1,087 1,109 1,090 1,126 1,165 1,029 1,072 1,096 1,071 1,165 1,161 108,627 108,923 106,490 131,048 161,542 172,867 2,256 2,287 2,352 2,298 2,485 2,403 173,840 195,420 219,740 234,390 111,024 163,214 92 46 46 48 48 48 3 7 6 6 5 3 11,387 7,007 7,289 16,000 13,964 14,549 157 203 City of Orono, Minnesota Statistical Section (Unaudited) Capital Asset Statistics by Function Last Ten Fiscal Years 2013 2014 2015 2016 Public Safety Police Stations 1 1 1 1 Patrol units 14 14 14 14 Fire stations 1 1 1 1 Public Works Highways and streets Streets (miles) 46 46 46 46 Street lights (1)135 135 135 135 Culture and Recreation Parks acreage (2)228 228 228 228 Parks 22 22 22 22 Beaches 4 4 4 4 Utilities Water Miles of water main 18 18 18 18 Wells 3 3 3 4 Water plants 2 2 2 2 Maximum daily capacity (thousands of gallons)2,160 2,160 2,160 3,800 Sewer Miles of sanitary sewer 47 47 47 47 Pumping stations 46 46 46 46 Golf Clubhouse 1 1 1 1 Holes 9 9 9 9 Source: City department records. (1) Historical streetlights was adjusted to reflect updated inforamtion (2) Historical park acerage was adjusted to reflect updated information Note: No capital asset indicators are avaliable for the general government functions Function 158 204 2017 2018 2019 2020 2021 2022 1 1 1 1 1 1 14 14 14 14 18 18 1 1 1 1 1 1 46 46 46 48 48 48 135 135 148 151 151 151 228 228 228 228 228 228 22 22 22 22 22 22 4 4 4 4 4 4 23 23 23 23 23 23 4 4 4 4 4 4 2 2 2 2 2 2 3,800 3,800 3,800 3,800 3,800 3,800 61 61 62 63 63 63 46 45 45 45 45 45 1 1 1 1 1 1 9 9 9 9 9 9 159 205 Executive Governance Summary City of Orono Orono, Minnesota For the year ended December 31, 2022 206 December 19, 2023 Management, Honorable Mayor and City Council City of 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 the City of Orono, Minnesota, (the City) for the year ended December 31, 2022. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards, as well as certain information related to the planned scope and timing of our audit . We have communicated such information in our letter to you dated December 21, 2022. Professional standards also require that we communicate to you the following information related to our audit. Significant Audit Findings In planning and performing our audit of the financial statements, 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 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. 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. 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. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. As described below, we identified a deficiency in internal control that we consider to be a material weakness, as finding 2022-001. 2 207 2022-001 Material Audit Adjustments Condition: During our audit, material adjustments were needed to correct the year-end balances for various accounts receivable and accounts payable balances. Criteria: Such adjustments were needed to correct year end balances. Amounts reported in the City’s accounting system need to agree to the underlying supporting documentation. Cause: City staff did not correctly adjust for receivable and payable balances during the year. Effect: This indicates that misstatements may occur and not be detected by the City’s system of internal control, which could lead to a material misstatement. Recommendation: We recommend management review the related journal entries, obtain an understanding of why the entries were necessary and modify current procedure to ensure that future corrections are not needed. Management Response: Management agrees with the finding and understands the reason the adjustments were needed. Procedures over year- end adjustments will be reevaluated to eliminate the need for related audit adjustments in the future. 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 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 ou r tests disclosed one instance of noncompliance or other matters that are required to be reported under Government Auditing Standards or Minnesota State Statutes and which are described as item 2022-002. 2022-002 Time Period for Payment Condition: Auditing for legal compliance requires a review of the City’s payment of claims. Our study indicated an instance of non-compliance that we believe is required to be remedied. Criteria: Minnesota statute section 471.425 requires that the City pay bills within 35 days from receipt. If the invoice is not paid within the 35 days, interest at 1.5 percent per month is to be added to amount due. Cause: We noted seven of 25 invoices sampled that were paid after the 35 day period. This occurred during staff turnover and transition. Effect: The City is in violation of this statute. Recommendation: We recommend that the City develop policies and procedures related to the accounts payable cycle. These policies and procedures should include payment terms that are outlined within State statutes. Implementing this recommendation will not result in any additional cost to the City. Management Response: Management believes that current procedures are sufficient to prevent future noncompliance. 3 208 Qualitative Aspects of Accounting Practices 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.. The City changed accounting policies during the year ended June 30, 2022 related to the accounting and financial reporting for lease activities (GASB 87). . We noted no transactions entered into by the governmental unit 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 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 included below: •Management’s estimate of depreciation is based on estimated useful lives of the assets. Depreciation is calculated using the straight-line method. •Allocations of gross wages and payroll benefits are approved by City Council within the City’s budget and are derived from each employee’s estimated time to be spent servicing the respective functions of the City. These allocations are also used in allocating accrued compensated absences payable. •Management’s estimate of its OPEB liability is based on several factors including, but not limited to, anticipated retirement age for active employees, life expectancy, turnover, and healthcare cost trend rate. •Management’s estimate of its lease receivable is based on the present value of lease payments expected to be received during the lease term. •Management’s estimate of its pension liabilities and assets are based on several factors including, but not limited to, anticipated investment return rate, retirement age for active employees, life expectancy, salary increases and form of annuity payment upon retirement. o The allocation of the pension liability related to Minnesota Public Employee Retirement Association (PERA) is based on the City’s proportionate share of employer contributions to the PERA cost -sharing multiple employer Coordinated and Police and Fire pension plans. We evaluated the key factors and assumptions used to develop these accounting estimates in determining that it is reasonable in relation to the financial statements taken as a whole. The disclosures in the financial statements are neutral, consistent, and clear. Certain financial statement disclosures are particularly sensitive because of their significance to financial statement users. Difficulties Encountered in Performing the Audit We encountered no significant difficulties in dealing with management in performing and completing our audit. Corrected and Uncorrected Misstatements We assisted in preparing a number of year end accounting entries. These were necessary to adjust the City’s records at year end to correct ending balances. The City should establish more detailed processes and procedures to reduce the total number of entries in each category. Material misstatements detected as a result of audit procedures were corrected by management. 4 209 The schedule below summarizes uncorrected misstatements of the financial statements. Management has determined that their effects are immaterial, both individually and in the aggregate, to the financial statements. Account Number Account Description Debit Credit Various Funds Unknown 17,606$ Various Funds Cash Balance 17,606$ Amount Disagreements with Management For purposes of this letter, professional standards define a disagreement with management as a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor’s report. We are pleased to report that no such disagreements arose during the course of our audit. Management Representations We have requested certain representations from management that are included in the management representation letter dated December 19, 2023. 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 auditor’s 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. Other Matters We applied certain limited procedures to the required supplementary information (RSI) (Management’s Discussion and Analysis, the Schedules of Employer’s Share of the Net Pension Liability, the Schedule of Changes in Net Pension Liability (Asset) and Related Ratios, the Schedules of Employer’s Contributions and the Schedule of Funding Progress for Other Post-Employment Benefits Plan), which is information that supplements the basic financial statements. Our procedures consisted of inquiries of management regarding 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 did not audit the RSI and do not express an opinion or provide any assurance on the RSI. We were engaged to report on the supplementary information (combining and individual fund financial statements and schedules), which accompany the financial statements but are not RSI. With respect to this supplementary information, 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, 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 were not engaged to report on the introductory or statistical sections, which accompany the financial statements but are not RSI. We did not audit or perform other procedures on this other information and we do not express an opinion or provide any assurance on them. Other Audit Findings or Issues We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention 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 retention. 5 210 Future Accounting Standard Changes The following Governmental Accounting Standards Board (GASB) Statements have been issued and may have an impact on future City financial statements: (1) GASB Statement No. 94 - Public-Private and Public-Public Partnerships and Availability Payment Arrangements Summary The primary objective of this Statement is to improve financial reporting by addressing issues related to public -private and public-public partnership arrangements (PPPs). As used in this Statement, a PPP is an arrangement in which a government (the transferor) contracts with an operator (a governmental or nongovernmental entity) to provide public services by conveying control of the right to operate or use a nonfinancial asset, such as infrastructure or other capital asset (the underlying PPP asset), for a period of time in an exchange or exchange-like transaction. Some PPPs meet the definition of a service concession arrangement (SCA), which the Board defines in this Statement as a PPP in which (1) the operator collects and is compensated by fees from third parties; (2) the transferor determines or has the ability to modify or approve which services the operator is required to provide, to whom the operator is required to provide the services, and the prices or rates that can be charged for the services; and (3) the transferor is entitled to significant residual interest in the service utility of the underlying PPP asset at the end of the arrangement. This Statement also provides guidance for accounting and financial reporting for availability payment arrangements (APAs). As defined in this Statement, an APA is an arrangement in which a government compensates an operator for services that may include designing, constructing, financing, maintain ing, or operating an underlying nonfinancial asset for a period of time in an exchange or exchange-like transaction. Effective Date and Transition The requirements of this Statement are effective for fiscal years beginning after June 15, 2022, and all reporting periods thereafter. Earlier application is encouraged. PPPs should be recognized and measured using the facts and circumstances that exist at the beginning of the period of implementation (or if applicable to earlier periods, the beginning of the earliest period restated). How the Changes in This Statement Will Improve Accounting and Financial Reporting The requirements of this Statement will improve financial reporting by establishing the definitions of PPPs and APAs and providing uniform guidance on accounting and financial reporting for transactions that meet those definitions. That uniform guidance will provide more relevant and reliable information for financial statement users and create greater consistency in practice. This Statement will enhance the decision usefulness of a government’s financial statements by requiring governments to report assets and liabilities related to PPPs consistently and disclose important information about PPP transactions. The required disclosures will allow users to understand the scale and important aspects of a government’s PPPs and evaluate a government’s future obligations and assets resulting from PPPs. 6 211 Future Accounting Standard Changes (Continued) GASB Statement No. 96 - Subscription-Based Information Technology Arrangements Summary This Statement provides guidance on the accounting and financial reporting for subscription -based information technology arrangements (SBITAs) for government end users (governments). This Statement (1) defines a SBITA; (2) establishes that a SBITA results in a right-to-use subscription asset - an intangible asset - and a corresponding subscription liability; (3) provides the capitalization criteria for outlays other than subscription payments, including implementation costs of a SBITA; and (4) requires note disclosures regarding a SBITA. To the extent relevant, the standards for SBITAs are based on the standards established in Statement No. 87, Leases, as amended. Under this Statement, a government generally should recognize a right-to-use subscription asset - an intangible asset - and a corresponding subscription liability. A government should recognize the subscription liability at the commencement of the subscription term, - which is when the subscription asset is placed into service. The subscription liability should be initially measured at the present value of subscription payments expected to be made during the subscription term. Future subscription payments should be discounted using the interest rate the SBITA vendor charges the government, which may be implicit, or the government’s incremental borrowing rate if the interest rate is not readily determinable. A government should recognize amortization of the discount on the subscription liability as an outflow of resources (for example, interest expense) in subsequent financial reporting periods. This Statement provides an exception for short-term SBITAs. Short-term SBITAs have a maximum possible term under the SBITA contract of 12 months (or less), including any options to extend, regardless of their probability of being exercised. Subscription payments for short-term SBITAs should be recognized as outflows of resources. This Statement requires a government to disclose descriptive information about its SBITAs other than short -term SBITAs, such as the amount of the subscription asset, accumulated amortization, other payments not included in the measurement of a subscription liability, principal and interest requirements for the subscription liability, and other essential information. Effective Date and Transition The requirements of this Statement are effective for fiscal years beginning after June 15, 2022, and all reporting periods thereafter. Earlier application is encouraged. Assets and liabilities resulting from SBITAs should be recognized and measured using the facts and circumstances that existed at the beginning of the fiscal year in which this Statement is implemented. Governments are permitted, but are not required, to include in the measurement of the subscription asset capitalizable outlays associated with the initial implementation stage and the operation and additional implementation stage incurred prior to the implementation of this Statement. How the Changes in This Statement Will Improve Accounting and Financial Reporting The requirements of this Statement will improve financial reporting by establishing a definition for SBITAs and providing uniform guidance for accounting and financial reporting for transactions that meet that definition. That definition and uniform guidance will result in greater consistency in practice. Establishing the capitalization criteria for implementation costs also will reduce diversity and improve comparability in financial reporting by governments. This Statement also will enhance the relevance and reliability of a government’s financial statements by requiring a government to report a subscription asset and subscription liability for a SBITA and to disclose essential information about the arrangement. The disclosures will allow users to understand the scale and important aspects of a government’s SBITA activities and evaluate a government’s obligations and assets resulting from SBITAs. 7 212 Future Accounting Standard Changes (Continued) GASB Statement No. 98 - The Annual Comprehensive Financial Report Summary This Statement establishes the term annual comprehensive financial report and its acronym ACFR. That new term and acronym replace instances of comprehensive annual financial report and its acronym in generally accepted accounting principles for state and local governments. This Statement was developed in response to concerns raised by stakeholders that the common pronunciation of the acronym for comprehensive annual financial report sounds like a profoundly objectionable racial slur. This Statement’s introduction of the new term is founded on a commitment to promoting inclusiveness. Effective Date and Transition The requirements of this Statement are effective for fiscal years ending after December 15, 2021. Earlier application is encouraged. GASB Statement No. 99 - Omnibus 2022 Summary The objectives of this Statement are to enhance comparability in accounting and financial reporting and to improve the consistency of authoritative literature by addressing (1) practice issues that have been identified during implementation and application of certain GASB Statements and (2) accounting and financial reporting for financial guarantees. The practice issues addressed by this Statement are as follows: • Classification and reporting of derivative instruments within the scope of Statement No. 53, Accounting and Financial Reporting for Derivative Instruments, that do not meet the definition of either an investment derivative instrument or a hedging derivative instrument • Clarification of provisions in Statement No. 87, Leases, as amended, related to the determination of the lease term, classification of a lease as a short-term lease, recognition and measurement of a lease liability and a lease asset, and identification of lease incentives • Clarification of provisions in Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangements, related to (a) the determination of the public-private and public-public partnership (PPP) term and (b) recognition and measurement of installment payments and the transfer of the underlying PPP asset • Clarification of provisions in Statement No. 96, Subscription-Based Information Technology Arrangements, related to the subscription-based information technology arrangement (SBITA) term, classification of a SBITA as a short - term SBITA, and recognition and measurement of a subscription liability • Extension of the period during which the London Interbank Offered Rate (LIBOR) is considered an appropriate benchmark interest rate for the qualitative evaluation of the effectiveness of an interest rate swap that hedges the interest rate risk of taxable debt • Accounting for the distribution of benefits as part of the Supplemental Nutrition Assistance Program (SNAP) • Disclosures related to nonmonetary transactions • Pledges of future revenues when resources are not received by the pledging government 8 213 Future Accounting Standard Changes (Continued) • Clarification of provisions in Statement No. 34, Basic Financial Statements—and Management’s Discussion and Analysis—for State and Local Governments, as amended, related to the focus of the government-wide financial statements • Terminology updates related to certain provisions of Statement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position • Terminology used in Statement 53 to refer to resource flows statements. Effective Date and Transition The requirements of this Statement that are effective as follows: • The requirements related to extension of the use of LIBOR, accounting for SNAP distributions, disclosures of nonmonetary transactions, pledges of future revenues by pledging governments, clarification of certain provisions in Statement 34, as amended, and terminology updates related to Statement 53 and Statement 63 are effective upon issuance. • The requirements related to leases, PPPs, and SBITAs are effective for fiscal years beginning after June 15, 2022, and all reporting periods thereafter. • The requirements related to financial guarantees and the classification and reporting of derivative instruments within the scope of Statement 53 are effective for fiscal years beginning after June 15, 2023, and all reporting periods thereafter. The Board considered the effective dates for the requirements of this Statement in light of the COVID-19 pandemic and in concert with Statement No. 95, Postponement of the Effective Dates of Certain Authoritative Guidance. How the Changes in This Statement Will Improve Accounting and Financial Reporting The requirements of this Statement will enhance comparability in the application of accounting and financial reporting requirements and will improve the consistency of authoritative literature. Consistent authoritative literature enables governments and other stakeholders to more easily locate and apply the correct accounting and financial reporting provisions, which improves the consistency with which such provisions are applied. The comparability of financial statements also will improve as a result of this Statement. Better consistency and comparability improve the usefulness of information for users of state and local government financial statements. 9 214 Future Accounting Standard Changes (Continued) GASB Statement No. 100 - Accounting Changes and Error Corrections - an amendment of GASB Statement No. 62 Summary The primary objective of this Statement is to enhance accounting and financial reporting requirements for accounting changes and error corrections to provide more understandable, reliable, relevant, consistent, and comparable information for making decisions or assessing accountability. This Statement defines accounting changes as changes in accounting principles, changes in accounting estimates, and changes to or within the financial reporting entity and describes the transactions or other events that con stitute those changes. As part of those descriptions, for (1) certain changes in accounting principles and (2) certain changes in accounting estimates that result from a change in measurement methodology, a new principle or methodology should be justified on the basis that it is preferable to the principle or methodology used before the change. That preferability should be based on the qualitative characteristics of financial reporting —understandability, reliability, relevance, timeliness, consistency, and comparability. This Statement also addresses corrections of errors in previously issued financial statements. This Statement prescribes the accounting and financial reporting for (1) each type of accounting change and (2) error corrections. This Statement requires that (a) changes in accounting principles and error corrections be reported retroactively by restating prior periods, (b) changes to or within the financial reporting entity be reported by adjusting beginning balances of the current period, and (c) changes in accounting estimates be reported prospectively by recognizing the change in the current period. The requirements of this Statement for changes in accounting principles apply to the implementation of a new pronouncement in absence of specific transition provisions in the new pronouncement. This Statement also requires that the aggregate amount of adjustments to and restatements of beginning net position, fund balance, or fund net position, as applicable, be displayed by reporting unit in the fi nancial statements. This Statement requires disclosure in notes to financial statements of descriptive information about accounting changes and error corrections, such as their nature. In addition, information about the quantitative effects on beginning balances of each accounting change and error correction should be disclosed by reporting unit in a tabular format to reconcile beginning balances as previously reported to beginning balances as restated. Furthermore, this Statement addresses how information that is affected by a change in accounting principle or error correction should be presented in required supplementary information (RSI) and supplementary information (SI). For periods that are earlier than those included in the basic financial statements, information presented in RSI or SI should be restated for error corrections, if practicable, but not for changes in accounting principles. Effective Date and Transition The requirements of this Statement are effective for accounting changes and error corrections made in fiscal years beginning after June 15, 2023, and all reporting periods thereafter. Earlier application is encouraged. How the Changes in This Statement Will Improve Accounting and Financial Reporting The requirements of this Statement will improve the clarity of the accounting and financial reporting requirements for accounting changes and error corrections, which will result in greater consistency in application in practice. In turn, more understandable, reliable, relevant, consistent, and comparable information will be provided to financial statement users for making decisions or assessing accountability. In addition, the display and note disclosure requirements wil l result in more consistent, decision useful, understandable, and comprehensive information for users about accounting changes and error corrections. 10 215 Future Accounting Standard Changes (Continued) GASB Statement No. 101 - Compensated Absences Summary The objective of this Statement is to better meet the information needs of financial statement users by updating the recognition and measurement guidance for compensated absences. That objective is achieved by aligning the recognition and measurement guidance under a unified model and by amending certain previously required disclosures. This Statement requires that liabilities for compensated absences be recognized for (1) leave that has not been used and (2) leave that has been used but not yet paid in cash or settled through noncash means. A liability should be recognized for leave that has not been used if (a) the leave is attributable to services already rendered, (b) the leave accumulates, and (c) the leave is more likely than not to be used for time off or otherwise paid in cash or settled through noncash means. Leave is attributable to services already rendered when an employee has performed the services required to earn the leave. Leave that accumulates is carried forward from the reporting period in which it is earned to a future reporting period during which it may be used for time off or otherwise paid or settled. In estimating the leave that is more likely than not to be used or otherwise paid or settled, a government should consider relevant factors such as employment policies related to compensated absences and historical information about the use or payment of compensated absences. However, leave that is more likely than not to be settled through conversion to defined benefit postemployment benefits should not be included in a liability for compensated absences. This Statement requires that a liability for certain types of compensated absences —including parental leave, military leave, and jury duty leave—not be recognized until the leave commences. This Statement also requires that a liability for specific types of compensated absences not be recognized until the leave is used. This Statement also establishes guidance for measuring a liability for leave that has not been used, generally using an employee’s pay rate as of the date of the financial statements. A liability for leave that has been used but not yet paid or settled should be measured at the amount of the cash payment or noncash settlement to be made. Certain salary -related payments that are directly and incrementally associated with payments for leave also should be i ncluded in the measurement of the liabilities. With respect to financial statements prepared using the current financial resources measurement focus, this Statement requires that expenditures be recognized for the amount that normally would be liquidated with expendable available financial resources. Effective Date and Transition The requirements of this Statement are effective for fiscal years beginning after December 15, 2023, and all reporting periods thereafter. Earlier application is encouraged. 11 216 How the Changes in This Statement Will Improve Accounting and Financial Reporting The unified recognition and measurement model in this Statement will result in a liability for compensated absences that more appropriately reflects when a government incurs an obligation. In addition, the model can be applied consistently to any type of compensated absence and will eliminate potential comparability issues between governments that offer different types of leave. The model also will result in a more robust estimate of the amount of compensated absences that a government will pay or settle, which will enhance the relevance and reliability of information about the liability for compensated absences (1) Note. From GASB Pronouncements Summaries. Copyright 2022 by the Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, USA, and is reproduced with permission. * * * * Restriction on Use This purpose of this communication is solely for the information and 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 those specified parties. Our audit would not necessarily disclose all weaknesses in the system because it was based on selected tests of the accounting records and related data. The comments and recommendations in the report are purely constructive in nature, and should be read in this context. If you have any questions or wish to discuss any of the items contained in this letter, please feel free to contact us at you r convenience. We wish to thank you for the continued opportunity to be of service and for the courtesy and cooperation extended to us by your staff. Abdo Minneapolis, Minnesota December 19, 2023 12 217 Other Required Reports City of Orono Orono, Minnesota For the year ended December 31, 2022 218 City of Orono, Minnesota Other Required Reports Table of Contents For the Year Ended December 31, 2022 Page No. Other Required Reports Independent Auditor’s Report on Minnesota Legal Compliance 3 Independent Auditor’s 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 4 Schedule of Finding and Response 6 2 219 INDEPENDENT AUDITOR’S REPORT ON MINNESOTA LEGAL COMPLIANCE Honorable Mayor and City Council City of 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 financial statements of the governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of the City of Orono, Minnesota (the City) as of and for the year ended December 31, 2022, and the related notes to the financial statements, and have issued our report thereon dated December 19, 2023. 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 contracting and bidding, deposits and investments, conflicts of interest, public indebtedness, claims and disbursements, miscellaneous provisions, and tax increment financing sections of the Minnesota Legal Compliance Audit Guide for Cities, promulgated by the State Auditor pursuant to Minn. Stat. § 6.65 , except as described in the Schedule of Findings and Responses as item 2022-02. 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, insofar as they relate to accounting matters. The City’s responses to the findings identified in our audit are described in our audit 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. This report is intended solely for the information and use of those charged with governance and management of the City and the State Auditor and is not intended to be, and should not be, used by anyone other than these specified parties. Abdo Minneapolis, Minnesota December 19, 2023 3 220 INDEPENDENT AUDITOR’S 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 and City Council City of 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 the City of Orono, Minnesota (the City), as of and for the year ended December 31, 2022, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements, and have issued our report thereon dated December 19, 2023. Report on 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) as a basis for designing 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. 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. 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. Our consideration of internal control was for the limited purpose described in the first paragraph of this section 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 were not identified. We identified a certain deficiency in internal control, described in the accompanying Schedule of Finding and Response as item 2022-001 that we consider to be a material weakness. Report on 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. 4 221 Response to Finding Government Auditing Standards requires the auditor to perform limited procedures on the City’s response to the finding identified in our audit and described in the accompanying Schedule of Finding and Response. The City’s response was not subjected to the other auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on the response. The City’s Responses to Findings The City’s responses to the findings identified in our audit are described in our audit 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 results 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. Abdo Minneapolis, Minnesota December 19, 2023 5 222 City of Orono, Minnesota Schedule of Finding and Response For the Year Ended December, 31 2022 Finding Description 2022-001 Material Audit Adjustments Condition: During our audit, material adjustments were needed to correct the year-end balances for various accounts receivable and payable balances. Criteria: Such adjustments were needed to correct year end balances. Amounts reported in the City’s accounting system need to agree to the underlying supporting documentation. Cause: City staff did not correctly adjust for receivable and payable balances during the year. Effect: This indicates that misstatements may occur and not be detected by the City’s system of internal control, which could lead to a material misstatement. Recommendation: We recommend management review the related journal entries, obtain an understanding of why the entries were necessary and modify current procedure to ensure that future corrections are not needed. Management Response: Management agrees with the finding and understands the reason the adjustments were needed. Procedures over year- end adjustments will be reevaluated to eliminate the need for related audit adjustments in the future. 2022-002 Time Period for Payment Condition: Auditing for legal compliance requires a review of the City’s payment of claims. Our study indicated an instance of non-compliance that we believe is required to be remedied. Criteria: Minnesota statute section 471.425 requires that the City pay bills within 35 days from receipt. If the invoice is not paid within the 35 days, interest at 1.5 percent per month is to be added to amount due. Cause: We noted seven of 25 invoices sampled that were paid after the 35 day period. This occurred during of staff turnover and transition. Effect: The City is in violation of this statute. Recommendation: We recommend that the City develop policies and procedures related to the accounts payable cycle. These policies and procedures should include payment terms that are outlined within State statutes. Implementing this recommendation will not result in any additional cost to the City. Management Response: Management believes that current procedures are sufficient to prevent future noncompliance. 6 223 Item No.: 9 Date: January 22, 2024 Presenter: James Van Eyll Presenter: Fire Chief Section:Public Safety Report Title: Authorization to hire a part-time firefighter 1.Purpose: The purpose of this action item is to gain approval to hire Part Time Firefighter for Weekday Daytime Duty Crew. 2.Background: The Orono Fire Department is currently seeking part time firefighters for our weekday daytime duty crew to cover our Station 2 call area. The selection process for the position involved advertising the position, application screening, and an interview. The interview was conducted by the Fire Chief and other city employees. The applicant must successfully complete a Psychological Exam, a Physical (Pre-employment medical) exam and a probationary period. All applicants will have to pass a background check performed by the Orono Police Department 3.Recommended Candidate: Taylor Andres is an experienced firefighter with two other fire departments. Taylor Andres has 4- years of experience, is a Firefighter I and II, and an EMT. She is excited to become a charter member of the Orono Fire Department and looks forward to creating the best department. 4.Recommended Compensation: I recommend Taylor Andres a conditional job offer as part time firefighter with an effective start date of January 23, 2024 for firefighter training and other such duties will be beginning on January 23, 2024. a. Pay. Starting rate of $20.00/hour. b. Benefits: Police and Fire PERA c. Conditions: Passing a physical exam, psychological exam and probationary period AGENDA ITEM COUNCIL ACTION REQUESTED Motion to approve the conditional job offer to Taylor Andres as a part time firefighter at the rate of $20.00 per hour with a start date of January 23, 2024. 224 Item No.: 10 Date: January 22, 2024 Presenter: Adam Edwards Presenter: City Administrator / Engineer Section:City Administrator/Engineer Report Title: Approve Next Work Session Draft Agenda 1.Purpose: The purpose of the action item is to forecast future work session agendas. 2. Date Subjects Date Subjects 8 Jan Annual Appointments 8 Jul 22 Jan Recodification-streets, utilities, parks 22 Jul General Fund Budget Update 12 Feb Average Lakeshore Setback (Part 3) 12 Aug 26 Feb Interview Commissioner Applicants (Parks/Planning)-- If Needed 26 Aug Enterprise Budget Update 11 Mar *two subjects proposed* 9 Sep Preliminary Levy / Budget 8 Apr Street Maintenance 2025 23 Sep 22 Apr 14 Oct Draft Capital Improvement Plans 13 May 28 Oct Draft Capital Improvement Plans 28 May 12 Nov 10 Jun 25 Nov Fee Schedule Update 24 Jun Preliminary Budget Guidance 2025 9 Dec Background: This is an opportunity for council members to propose and agree to future work session topics. Work session meetings are at 5 pm on the same days as 6 pm regular council meetings. The table below lists upcoming proposed subjects and dates. 3.Process: Two subjects were proposed by Council Member Benson to be added the 11 March work session. Elected and appointed official civility Tech use at the dias 4.Staff Recommendation: I recommend holding the next work session as proposed and scheduled. AGENDA ITEM COUNCIL ACTION REQUESTED Move to approve the draft schedule and hold the next work session as proposed and scheduled. 225 Item No.: 11 Date: January 22, 2024 Presenter: Adam Edwards Presenter: City Administrator / Engineer Section:City Administrator/Engineer Report Title: Orono Fire facility in Navarre (23-044) Draft Design Review 1.Purpose: The purpose of this item is to draft plans for the Orono Fire Facility in Navarre with the City Council. 2.Background: At the July 24th, 2023 Meeting Council directed staff engage with Oertel Architects to provide architectural services for a design proposal for Orono Fire Facilities. At the August 28th meeting the council approved the contract and authorized the completion of the schematic design phase of the projects. At the November 28th meeting Council authorized the design team to proceed to the design development and construction document phases of the design process. Since then the design team has been focusing on the provision of a 2-bay building adjacent to he existing Navarre Fire station. 3.Process: The proposed Time Line is as follows. A. January 30th : Solicit Bids B. February 20th : Open Bids C. February 26th : Award D. March - April: Complete Permitting E. May-July: Construction 4.Staff Recommendation: I recommend council provide any comments on the facility. AGENDA ITEM COUNCIL ACTION REQUESTED Provide any comments on the draft fire facility plans. Exhibits Exhibit A Orono Fire Station Site Plans Exhibit B Orono Fire Station Architectural Plans 226 GAS GAS GAS UGEl l l UGE UGE UGEUGEUGEUGEUGEUGELIVI N G S T O N A V E N U E OHELEGENDHYDRANTSANITARY MANHOLEGATE VALVEPOWER POLELIGHT POLECATCH BASINSIGNDECIDUOUS TREECONIFEROUS TREESHRUBPEDESTALGUY WIREBOLLARDPOWER BOXELECTRIC METERMONITORING WELLSANITARY SEWER CLEANOUTWOOD FENCECHAINLINK FENCEWIRE FENCESTORM SEWER LINESANITARY SEWER LINEWATERMAINOVERHEAD ELECTRICUNDERGROUND TELEPHONEUNDERGROUND FIBERUNDERGROUND ELECTRICUNDERGROUND GAS LINECONCRETE PAVEMENTBITUMINOUS PAVEMENTAGGREGATE SURFACINGLANDSCAPINGBUILDINGUGTFOUGEGASlWCOX0'20'40'NOTES:1.EXISTING CONDITIONS & TOPOGRAPHIC INFORMATION PROVIDED BY:DESIGN TREE ENGINEERING & LAND SURVEYING120 17TH AVENUE WALEXANDRIA, MN 563082.CONTRACTOR SHALL FIELD VERIFY ALL BUILDING DIMENSIONS ANDREMOVAL LIMITS PRIOR TO ANY CONSTRUCTION.3.SAWCUT CURB AND GUTTER AND SIDEWALK, OR REMOVE AT NEARESTEXPANSION JOINTS.4.SAWCUT BITUMINOUS PAVEMENT FULL DEPTH AT ALL TIE-IN LOCATIONS.5.CONTRACTOR SHALL PLACE ALL NECESSARY EROSION CONTROLMEASURES REQUIRED TO MAINTAIN SITE STABILITY PRIOR TOEXECUTING ANY SITE REMOVALS.6.CONTRACTOR SHALL BE RESPONSIBLE FOR COORDINATION WITH UTILITYPROVIDERS FOR REMOVAL AND/OR RELOCATION OF EXISTING UTILITIESAFFECTED BY SITE DEVELOPMENT. ALL PERMITS, APPLICATIONS, ANDFEES ARE THE RESPONSIBILITY OF THE CONTRACTOR.7.PRIVATE UTILITIES THAT ARE NOT RELOCATED AS PART OF COORDINATEWITH UTILITY PROVIDERS SHALL BE PROTECTED AT ALL TIMES.8.CONTRACTOR SHALL POTHOLE EXISTING UNDERGROUND UTILITIES TOVERIFY LOCATION AND DEPTH PRIOR TO CONSTRUCTION.9.ALL EXCESS OR WASTE MATERIAL GENERATED AS PART OFCONSTRUCTION SHALL BE REMOVED FROM THE SITE AND DISPOSED OFIN ACCORDANCE WITH STATE AND LOCAL REQUIREMENTS.10.CONTRACTOR SHALL MAINTAIN FULL ACCESS TO ADJACENT PROPERTIESDURING CONSTRUCTION AND TAKE ALL PRECAUTIONS NECESSARY TOAVOID PROPERTY DAMAGE TO ADJACENT PROPERTIES.11.THE LOCATIONS AND ELEVATIONS OF THE EXISTING UTILITIES SHOWNHEREIN ARE APPROXIMATE. THEY HAVE BEEN PLOTTED FROM AVAILABLESURVEYS AND/ OR RECORDS. THE CONTRACTOR IS RESPONSIBLE FORFIELD VERIFYING LOCATION AND ELEVATION TO ENSURE THAT ANYEXISTING UTILITIES (SHOWN OR NOT SHOWN) ARE NOT DAMAGEDDURING CONSTRUCTION.12.GOPHER STATE ONE CALL DAMAGE PREVENTION SYSTEM FOR BURIEDUTILITIES. 1-800-252-1166. CONTRACTOR SHALL HIRE A PRIVATEUTILITY LOCATOR TO ASSIST WITH PRIVATE UTILITY LOCATES.REMOVALS LEGEND= CURB REMOVAL= BITUMINOUS PAVEMENT REMOVAL= CONCRETE REMOVAL= REMOVAL ITEM12SAWCUT AND REMOVE EXISTING BITUMINOUS PAVEMENTSAWCUT AND REMOVE EXISTING CONCRETE OR REMOVE AT NEAREST EXPANSION JOINTSAWCUT AND REMOVE EXISTING CURB & GUTTER OR REMOVE AT NEAREST EXPANSION JOINTREMOVE TREESALVAGE SIGNPROTECT BOLLARD/ POSTRELOCATE UTILITY HAND HOLE (SEE NOTES)RELOCATE LIGHT POLE (SEE NOTES)SALVAGE EXISTING HYDRANT ASSEMBLY FOR REUSEREMOVE GATE VALVE AND WATER PIPE TO THE EXTENTS SHOWN, APPROXIMATELY 21-FTLOCATE UTILITIES PRIOR TO CONSTRUCTION. VERIFY DEPTH (SEE NOTES)CLEAR AND GRUB WOODED AREA TO ACHIEVE PROPOSED GRADING PLAN345KEY NOTES:67891011PLOTTED:FILE NAME:1-12-2024SIGNATUREJANUARY 12, 2023PROJECT NUMBER:DATE ISSUED:DRAWN BY:CHECKED BY:REVISIONS:PROJECT NAME:ORONO, MN.09623003City of OronoFire DepartmentSHEET NO:DATESHEET NAME:09623003-C-Base-Proposed.dwgLICENSE #I HEREBY CERTIFY THAT THIS PLAN, SPECIFICATION, ORREPORT WAS PREPARED BY ME OR UNDER MY DIRECTSUPERVISION AND THAT I AM A DULY LICENSEDPROFESSIONAL ENGINEER IN THE STATE OFMINNESOTA.1795 ST. CLAIR AVENUEST. PAUL, MN 55105 (651) 696-5186www.oertelarchitects.comOERTELARCHITECTSGKDRJK11123344456781091111111111212121212TREE REMOVALLIMITS, TYPEXISTINGCONDITIONS ANDREMOVALSC101227 GASGASGASUGE llUGEUGEUGE UGE UGE UGE UGE UGE 958.14958.40 958.40 958.12 957.70 956.35 957.59 l l l 957.55960965970959961962963964966967968969971972958.83 960.68 958.50 958.50 958.50 956.41 960.08 957.00 957.00 958.04 l > > 960.99 960.95 960.75 GRADING LEGEND = EXISTING MAJOR CONTOUR = EXISTING MINOR CONTOUR = EXISTING CONTOUR LABEL = PROPOSED MAJOR CONTOUR = PROPOSED MINOR CONTOUR = PROPOSED CONTOUR LABEL = EXISTING SPOT ELEVATION* = PROPOSED SPOT ELEVATION* = PROPOSED SURFACE FLOW DIRECTION *SPOT ELEVATIONS ALONG CURB & GUTTER AND OTHER REVEALS ARE TO FLOWLINE, UNLESS OTHERWISE NOTED. 100 0'20'40' NOTES: 1.THE LOCATIONS AND ELEVATIONS OF THE EXISTING UTILITIES SHOWN HEREIN ARE APPROXIMATE. THEY HAVE BEEN PLOTTED FROM AVAILABLE SURVEYS AND/ OR RECORDS. THE CONTRACTOR IS RESPONSIBLE FOR FIELD VERIFYING LOCATION AND ELEVATION TO ENSURE THAT ANY EXISTING UTILITIES (SHOWN OR NOT SHOWN) ARE NOT DAMAGED DURING CONSTRUCTION. 2.SIDEWALKS SHALL MEET ADA REQUIREMENTS, AND SHALL NOT EXCEED 2.00% CROSS SLOPE, OR 5.00% LONGITUDINAL SLOPE. 3.CONCRETE ENTRANCES AND APPROACHES SHALL NOT EXCEED 2.00% CROSS SLOPE IN SIDEWALK AREAS. 4.ACCESSIBLE PARKING STALLS SHALL MEET ADA REQUIREMENTS, AND SHALL NOT EXCEED 2.00% CROSS SLOPE IN ALL DIRECTIONS. 5.PEDESTRIAN RAMPS SHALL MEET ADA REQUIREMENTS. 6.ALL EXCESS OR WASTE MATERIAL GENERATED AS PART OF CONSTRUCTION SHALL BE REMOVED FROM THE SITE AND DISPOSED OF IN ACCORDANCE WITH STATE AND LOCAL REQUIREMENTS. 7.ALL EXCAVATION SHALL BE IN ACCORDANCE WITH THE CURRENT EDITION OF "STANDARD SPECIFICATIONS FOR TRENCH EXCAVATION AND BACKFILL/SURFACE RESTORATION" AS PREPARED BY THE CITY ENGINEERS ASSOCIATION OF MINNESOTA. 8.IN ADDITION TO THESE PLANS, A STORMWATER MANAGEMENT STUDY HAS BEEN PROVIDED. THE STORMWATER MANAGEMENT STUDY INCLUDES ADDITIONAL INFORMATION REGARDING THE DESIGN OF THE STORMWATER MANAGEMENT BMP. THE CONTRACTOR SHALL REVIEW THE STORMWATER BOOK AND COMPLY WITH ALL STATE AND LOCAL REQUIREMENTS. 9.ALL SITE WORK SHALL BE PERFORMED IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE GEOTECHNICAL ENGINEER. 10.INFILTRATION AREAS SHALL NOT BE EXCAVATED TO FINAL GRADE UNTIL THE CONTRIBUTING DRAINAGE AREA HAS BEEN CONSTRUCTED AND STABILIZED. ONLY LOW IMPACT TRACK EQUIPMENT SHALL BE USED WITHIN INFILTRATION AREAS. 11.SPOT ELEVATIONS SHOWN INDICATE FINISHED PAVEMENT ELEVATIONS & GUTTER FLOW LINE UNLESS OTHERWISE NOTED. PROPOSED CONTOURS ARE TO FINISHED SURFACE GRADE. 12.GOPHER STATE ONE CALL DAMAGE PREVENTION SYSTEM FOR BURIED UTILITIES. 1-800-252-1166. CONTRACTOR SHALL HIRE A PRIVATE UTILITY LOCATOR TO ASSIST WITH PRIVATE UTILITY LOCATES. XX.XX 1 2 MATCH INTO EXISTING BITUMINOUS PAVEMENT MATCH INTO EXISTING CONCRETE MATCH INTO EXISTING CURB & GUTTER MODULAR BLOCK RETAINING WALL GRADE BREAK 3 4 5 KEY NOTES: PLOTTED:FILE NAME:1-12-2024 SIGNATURE JANUARY 12, 2023 PROJECT NUMBER: DATE ISSUED: DRAWN BY: CHECKED BY: REVISIONS: PROJECT NAME: ORONO, MN. 09623003 City of Orono Fire Department SHEET NO: DATE SHEET NAME: 09623003-C-Base-Proposed.dwg LICENSE # I HEREBY CERTIFY THAT THIS PLAN, SPECIFICATION, OR REPORT WAS PREPARED BY ME OR UNDER MY DIRECT SUPERVISION AND THAT I AM A DULY LICENSED PROFESSIONAL ENGINEER IN THE STATE OF MINNESOTA. 1795 ST. CLAIR AVENUE ST. PAUL, MN 55105 (651) 696-5186 www.oertelarchitects.com OERTEL ARCHITECTS GKD RJK PROPOSED BUILDING FFE: 958.50 EOF 957.50 LIVINGSTON AVENUEGRADE SWALE GRADE SWALEGRADE SWALE1 2 3 1 5 4 6 4 1 1 EXISTING CMP INV 951.77 GRADING PLAN C301 228 GASGASGASUGE llUGEUGEUGE UGE UGE UGE UGE UGE l l l l >>= HYDRANT = CURB STOP = GATE VALVE = SANITARY MANHOLE = CLEANOUT = STORM MANHOLE = CATCH BASIN = CULVERT APRON = WATER LINE = SANITARY LINE = STORM LINE PROPOSED UTILITY LEGEND l>0'20'40' NOTES: 1.THE LOCATIONS AND ELEVATIONS OF THE EXISTING UTILITIES SHOWN HEREIN ARE APPROXIMATE. THEY HAVE BEEN PLOTTED FROM AVAILABLE SURVEYS AND/ OR RECORDS. THE CONTRACTOR IS RESPONSIBLE FOR FIELD VERIFYING LOCATION AND ELEVATION TO ENSURE THAT ANY EXISTING UTILITIES (SHOWN OR NOT SHOWN) ARE NOT DAMAGED DURING CONSTRUCTION. 2.CONTRACTOR SHALL VERIFY AND COORDINATE BUILDING UTILITY CONNECTION SIZES, LOCATIONS, AND ELEVATIONS WITH PLUMBING, MECHANICAL, AND ELECTRICAL CONTRACTORS. 3.ALL EXCAVATION SHALL BE IN ACCORDANCE WITH THE CURRENT EDITION OF "STANDARD SPECIFICATIONS FOR TRENCH EXCAVATION AND BACKFILL/SURFACE RESTORATION" AS PREPARED BY THE CITY ENGINEERS ASSOCIATION OF MINNESOTA. 4.ALL WATER PIPING SHALL BE BURIED A MINIMUM OF 8'. 5.SEE WATER DETAILS FOR ADDITIONAL INFORMATION. 6.A MINIMUM VERTICAL SEPARATION OF 18 INCHES IS REQUIRED AT ALL WATER LINE CROSSINGS WITH SANITARY SEWER OR STORM SEWER. THE WATER LINE SHALL NOT HAVE JOINTS OR CONNECTIONS WITHIN 10 FEET OF THE CROSSING. INSULATE CROSSINGS WITH STORM SEWER. 7.SANITARY SEWER CLEANOUTS SHALL BE PROVIDED WITHIN 5' OF THE BUILDING FOR UNIT'S CONNECTION. 8.SANITARY SEWER CLEANOUT SPACING SHALL NOT EXCEED 90'. 9.SANITARY SEWER SERVICES SHALL HAVE A MINIMUM OF 2.00% GRADE. 10.SEE SANITARY SEWER DETAILS FOR ADDITIONAL INFORMATION. 11.ALL NONCONDUCTIVE PIPE SHALL BE INSTALLED WITH A LOCATE (TRACER) WIRE PER MINNESOTA RULES, PART 7560.0150 12.ALL CONSTRUCTION AND MATERIALS SHALL BE IN ACCORDANCE WITH THE MINNESOTA STATE PLUMBING CODE. 13.ALL PIPING SHALL BE TESTED IN ACCORDANCE WITH THE MINNESOTA STATE PLUMBING CODE. 14.CONTRACTOR SHALL COORDINATE UTILITY INSPECTIONS WITH LOCAL AUTHORITIES HAVING JURISDICTION. 15.GOPHER STATE ONE CALL DAMAGE PREVENTION SYSTEM FOR BURIED UTILITIES. 1-800-252-1166. CONTRACTOR SHALL HIRE A PRIVATE UTILITY LOCATOR TO ASSIST WITH PRIVATE UTILITY LOCATES. PLOTTED:FILE NAME:1-12-2024 SIGNATURE JANUARY 12, 2023 PROJECT NUMBER: DATE ISSUED: DRAWN BY: CHECKED BY: REVISIONS: PROJECT NAME: ORONO, MN. 09623003 City of Orono Fire Department SHEET NO: DATE SHEET NAME: 09623003-C-Base-Proposed.dwg LICENSE # I HEREBY CERTIFY THAT THIS PLAN, SPECIFICATION, OR REPORT WAS PREPARED BY ME OR UNDER MY DIRECT SUPERVISION AND THAT I AM A DULY LICENSED PROFESSIONAL ENGINEER IN THE STATE OF MINNESOTA. 1795 ST. CLAIR AVENUE ST. PAUL, MN 55105 (651) 696-5186 www.oertelarchitects.com OERTEL ARCHITECTS GKD RJKLIVINGSTON AVENUE97-LF 4" SCH 40 PVC SEWER BUILDING CONNECTION INV:955.0 COORDINATE SIZE, INVERT AND LOCATION WITH PLUMBING ENGINEER CONNECT TO EXISTING SANITARY SEWER MANHOLE AT INVERT 950.00 2" DOMESTIC PE WATER SERVICE 2" CURB STOP 2" WET TAP 25 LF - 6" PVC C900 (2) 45 DEGREE BEND FITTINGS FIELD VERIFY SIZE, MATERIAL, AND LOCATION CONNECT TO EXISTING PIPE INSTALL SALVAGED HYDRANT ASSEMBLY SUMP MH#1 CASTING R-1733 SW INV: 955.7 E INV: 954.25 CONNECT TO EXISTING 15" CMP 6" HDPE FES#2 INV: 956.35 30.7-FT OF 6" HDPE @ 2.12% 2" PE WATER SERVICE 4" SEWER CLEAN OUT UTILITY PLANS C401 229 230 231 232 233 234 235 236 Item No.: 12 Date: January 22, 2024 Presenter: Adam Edwards Presenter: City Administrator / Engineer Section:Council Committee Reports Title: Council Committee Reports - Communication Committee 1.Purpose: The purpose of the agenda item is for the Orono council members to update one another on recent council committee meetings. 2.Last Meeting: The Communications Committee met on January 10, 2024 with the following agenda: 1. Old Business. A. Communications Interactions (As of 29 Sep 23) B. Communications Initiatives 2023 Website Refresh to include new home pages for GC and PD. GC Rebranding Bi-Monthly newsletter (Orono Happenings) Utility Billing Inserts 2. New Business. A. Communications Planning for 2024. What is the problem(s) that we want to fix? Considering our role (what is our role as an organization… public protection, health, safety..) What are our goals B. Communication Activities for 2024. 3. Other 3.Members: A. Council Members. Denny Walsh & Maria Veach B. City Staff Members. Adam Edwards and Christine Lusian. AGENDA ITEM COUNCIL ACTION REQUESTED Discussion Item - no formal action required. 237 Item No.: 13 Date: January 22, 2024 Presenter: Adam Edwards Presenter: City Administrator / Engineer Section:Closed Session Title: Closed session to discuss Orono and Long Lake litigation 1.Purpose: The City Council may close the meeting as permitted by Minn. Stat. §13D.05 subd.3(c)(3) to hold a confidential, attorney-client privileged discussion of legal rights and remedies, potential legal action, and strategy regarding Orono and Long Lake litigation. 2.Staff Recommendation: None AGENDA ITEM COUNCIL ACTION REQUESTED None 238