HomeMy WebLinkAbout07.01.24 Council PacketMeeting Location:
Farmington City Hall, Council
Chambers
430 Third Street
Farmington, MN 55024
CITY COUNCIL REGULAR MEETING AGENDA
Monday, July 1, 2024
7:00 PM
Page
1.CALL TO ORDER 7:00 P.M.
2.PLEDGE OF ALLEGIANCE
3.ROLL CALL
4.APPROVE AGENDA
5.ANNOUNCEMENTS / COMMENDATIONS
5.1. Parks and Recreation Month Proclamation
Proclaim July 2024 as Parks and Recreation Month in Farmington.
Agenda Item: Parks and Recreation Month Proclamation - Pdf
4 - 5
6.CITIZENS COMMENTS / RESPONSES TO COMMENTS
(This time is reserved for citizen comments regarding non-agenda items. No
official action can be taken on these items. Speakers are limited to five minutes
to address the city council during citizen comment time.)
7.CONSENT AGENDA
7.1. Gambling Event Permit Application for Church of St. Michael,
September 28-29, 2024
Agenda Item: Gambling Event Permit Application for Church of St.
Michael, September 28-29, 2024 - Pdf
6 - 9
7.2. Temporary On-Sale Liquor License Application for the Church of St.
Michael, September 28-29, 2024
Agenda Item: Temporary On-Sale Liquor License Application for the
Church of St. Michael, September 28-29, 2024 - Pdf
10 - 14
7.3. Minutes of the June 17, 2024 Regular City Council Meeting
Agenda Item: Minutes of the June 17, 2024 Regular City Council
Meeting - Pdf
15 - 23
Page 1 of 352
7.4. Minutes of the June 17, 2024 Special Work Session
Agenda Item: Minutes of the June 17, 2024 Special Work Session - Pdf
24 - 26
7.5. Resolution Approving a Second Amendment to the Appointments to
Council Committees for the Remainder of Calendar Year 2024
Agenda Item: Resolution Approving a Second Amendment to the
Appointments to Council Committees for the Remainder of Calendar
Year 2024 - Pdf
27 - 29
7.6. Resolution 2024-59 Amending Resolution 2024-43 Approving and
Authorizing Execution of an Abatement Agreement with Apartments
Farmington, LLC
Agenda Item: Resolution 2024-59 Amending Resolution 2024-43
Approving and Authorizing Execution of an Abatement Agreement with
Apartments Farmington, - Pdf
30 - 48
7.7. Payment of Claims
Agenda Item: Payment of Claims - Pdf
49 - 50
Payment of Claims
7.8. Fire Service Agreement with Eureka Township
Agenda Item: Fire Service Agreement with Eureka Township - Pdf
Eureka Township Fire Service Agreement
51 - 73
7.9. Staff Changes and Recommendations
Agenda Item: Staff Changes and Recommendations - Pdf
74
7.10. Agreement with Rose Music Services for Solo Acoustic Live-Looping
Performance
Agenda Item: Agreement with Rose Music Services for Solo Acoustic
Live-Looping Performance - Pdf
75 - 83
7.11. Donation of Gift Cards and Water Bottles from Twin Cities Running
Company to the Dew Run
Agenda Item: Accepting a Donation of Gift Cards and Water Bottles
from Twin Cities Running Company to the Dew Run - Pdf
84 - 85
7.12. Amendment to the Criminal Justice Network Joint Powers Agreement
Agenda Item: Amendment to the Criminal Justice Network Joint Powers
Agreement - Pdf
86 - 99
8. PUBLIC HEARINGS
8.1. Cannabis Business Moratorium
Approve the passage of Ordinance 2024-06, An Interim Ordinance
Prohibiting the Operation of Cannabis Businesses.
Agenda Item: Cannabis Business Moratorium - Pdf
100 - 104
9. AWARD OF CONTRACT
Page 2 of 352
10. PETITIONS, REQUESTS AND COMMUNICATIONS
11. UNFINISHED BUSINESS
12. NEW BUSINESS
12.1. 2023 Annual Comprehensive Financial Report and Related Audit
Reports
Not applicable
Agenda Item: 2023 Annual Comprehensive Financial Report and
Related Audit Reports - Pdf
105 - 352
13. CITY COUNCIL ROUNDTABLE
14. ADJOURN
Page 3 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Kellee Omlid, Parks & Recreation Director
Department: Parks & Recreation
Subject: Parks and Recreation Month Proclamation
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
Since 1985, people in the United States have celebrated Parks and Recreation Month in July to
promote building strong, vibrant, and resilient communities through the power of parks and
recreation and to recognize the more than 160,000 full-time parks and recreation professionals
along with hundreds of thousands of part-time and seasonal workers and volunteers that maintain
our country’s local, state, and community parks.
DISCUSSION:
recreation and parks ways many the Belong," You “Where theme, year’s This celebrates
professionals across the country foster a sense of belonging in their community by providing
welcoming and inclusive programs, essential services for all ages and abilities, and safe, accessible
spaces to build meaningful connections. Thank you to the Parks and Recreation Staff and
volunteers for all you do to provide quality facilities, parks, programs, and an environment that
improves quality of life and promotes community unity in Farmington!
The Parks and Recreation Department will celebrate Parks and Recreation Month by hosting a
party in the park on Friday, July 26 at Lake Julia Park. The party starts at 7 pm with Kidsdance,
games, face painting, crafts, and more. Kidsdance is America’s interactive DJ service for kids. At
dusk (approximately 8:40 pm), the movie Shrek will be shown. Thank you to the event sponsors
including Castle Rock Bank, Dakota Electric Association, Farmington Youth Hockey Association,
Marschall Line, and Farmington VFW Post 7662. This is a free event, and all are invited to attend.
ACTION REQUESTED:
Proclaim July 2024 as Parks and Recreation Month in Farmington.
ATTACHMENTS:
Parks and Recreation Month Proclamation 2024
Page 4 of 352
P R O C L A M A T I O N
PARKS AND RECREATION MONTH, JULY 2024
WHEREAS, parks and recreation is an integral part of communities throughout this country, including
Farmington, promoting health and wellness and improving the physical and mental health
of people who live near parks; and
WHEREAS, parks and recreation promotes time spent in nature, which positively impacts mental
health by increasing cognitive performance and well-being and alleviating illnesses, such
as depression, attention deficit disorders, and Alzheimer’s; and
WHEREAS, parks and recreation encourages physical activities by providing space for popular sports,
hiking trails, and many other activities designed to promote active lifestyles; and
WHEREAS, parks and recreation programming and education activities, such as out-of-school time
programming, youth sports, and environmental education, are critical to child
development; and
WHEREAS, parks and recreation increases a community’s economic prosperity through increased
property values, expansion of the local tax base, increased tourism, the attraction and
retention of businesses, and crime reduction; and
WHEREAS, parks and recreation is fundamental to the environmental well-being of our community
and the city’s parks and natural recreation areas ensure the ecological beauty of
Farmington and provide a place for children and adults to connect with nature and recreate
outdoors; and
WHEREAS, the U.S. House of Representatives has designated July as Parks and Recreation Month;
and
WHEREAS, the City of Farmington recognizes the benefits derived from parks and recreation
resources.
NOW THEREFORE, I, Joshua Hoyt, Mayor, on behalf of the Farmington City Council, do hereby
proclaim July 2024 as
PARKS AND RECREATION MONTH
IN WITNESS WHEREOF, I have hereunto set my hand
and caused the seal of the City of Farmington, Minnesota,
to be affixed on this 1st day of July 2024.
___________________________________
Joshua Hoyt, Mayor
Page 5 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Shirley Buecksler, City Clerk
Department: Administration
Subject: Gambling Event Permit Application for Church of St. Michael, September 28-29,
2024
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
The Church of St. Michael has applied for a Gambling Event Permit for September 28-29, 2024.
DISCUSSION:
Per State Statute and City Code, gambling permit applications must first be approved by the City
before the applicant may submit their application to the Gambling Control Board.
The Church of St. Michael will be having bingo on Saturday, September 28th, from 4 - 8 pm and
also on Sunday, September 29th, from 12 - 5 pm. A raffle drawing will be held on Sunday,
September 29th, at 3 pm.
ACTION REQUESTED:
Adopt Resolution 2024-56 Concurring with the Issuance of a Minnesota Lawful Gambling Exempt
Permit to Conduct Bingo and Raffle - Church of St. Michael, September 28-29, 2024.
ATTACHMENTS:
Res 2024-56 Gambling Event Permit, Church of St. Michael Sept 28-29, 2024
Application for Gambling Permit, Church of St. MIchael
Page 6 of 352
CITY OF FARMINGTON
DAKOTA COUNTY, MINNESOTA
RESOLUTION 2024-56
A RESOLUTION CONCURRING WITH THE ISSUANCE
OF A MINNESOTA LAWFUL GAMBLING EXEMPT PERMIT
TO CONDUCT BINGO AND RAFFLE –
CHURCH OF ST. MICHAEL, SEPTEMBER 28-29, 2024
WHEREAS, the Church of St. Michael has made application for a Lawful Gambling
Exempt Permit to the Gambling Control Board to conduct gambling in the form of bingo and a
raffle on September 28-29, 2024; and
WHEREAS, the City of Farmington has no objections to the said activity.
NOW, THEREFORE, BE IT RESOLVED that the Farmington Mayor and City Council
hereby concur with the issuance of a Lawful Gambling Exempt Permit by the Gambling Control
Board to the Church of St. Michael for an event on September 28-29, 2024 to be conducted at the
Church of St. Michael, 22120 Denmark Avenue, Farmington, Minnesota.
Adopted by the City Council of the City of Farmington, Minnesota, this 1st day of July 2024.
ATTEST:
____________________________ ______________________________
Joshua Hoyt, Mayor Shirley R Buecksler, City Clerk
Page 7 of 352
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n
g
yo
u
r
or
g
a
n
i
z
a
t
i
o
n
as
a
su
b
o
r
d
i
n
a
t
e
.
IG
A
M
B
L
I
N
G
PR
E
M
I
S
E
S
IN
F
O
R
M
A
T
I
O
N
Na
m
e
of
pr
e
m
i
s
e
s
wh
e
r
e
th
e
ga
m
b
l
i
n
g
ev
e
n
t
wi
l
l
be
co
n
d
u
c
t
e
d
(f
o
r
ra
f
f
l
e
s
,
li
s
t
th
e
si
t
e
wh
e
r
e
th
e
dr
a
w
i
n
g
wi
l
l
ta
k
e
pl
a
c
e
)
:
Ch
U
F
C
h
Of
St
-
Mi
c
h
a
e
l
Ph
y
s
i
c
a
l
Ad
d
r
e
s
s
(d
o
no
t
us
e
PO
.
bo
x
)
:
Ch
e
c
k
on
e
:
.C
i
t
y
:
Fa
r
m
i
n
to
n
Zi
p
:
55
0
2
4
Co
u
n
t
y
:
Da
k
o
t
a
[:
I
T
o
w
n
s
h
i
p
:
Zi
p
:
Co
u
n
t
y
:
Da
t
e
(
s
)
of
ac
t
i
v
i
t
y
(f
o
r
ra
f
f
l
e
s
,
in
d
i
c
a
t
e
th
e
da
t
e
of
th
e
dr
a
w
i
n
g
)
:
Ch
e
c
k
ea
c
h
ty
p
e
of
ga
m
b
l
i
n
g
ac
t
i
v
i
t
y
th
a
t
yo
u
r
or
g
a
n
i
z
a
t
i
o
n
wi
l
l
co
n
d
u
c
t
:
Bi
n
g
o
[:
l
Pa
d
d
l
e
w
h
e
e
l
s
D
Pu
l
l
—
T
a
b
s
|:
|
Ti
p
b
o
a
r
d
s
Ra
f
?
e
Ga
m
b
l
i
n
g
eq
u
i
p
m
e
n
t
fo
r
bi
n
g
o
pa
p
e
r
,
bi
n
g
o
bo
a
r
d
s
,
ra
f
f
l
e
bo
a
r
d
s
,
pa
d
d
l
e
w
h
e
e
l
s
,
pu
l
l
—
t
a
b
s
,
an
d
ti
p
b
o
a
r
d
s
mu
s
t
be
ob
t
a
i
n
e
d
fr
o
m
a
di
s
t
r
i
b
u
t
o
r
li
c
e
n
s
e
d
by
th
e
Mi
n
n
e
s
o
t
a
Ga
m
b
l
i
n
g
Co
n
t
r
o
l
Bo
a
r
d
.
EX
C
E
P
T
I
O
N
:
Bi
n
g
o
ha
r
d
ca
r
d
s
an
d
bi
n
g
o
ba
l
l
se
l
e
c
t
i
o
n
de
v
i
c
e
s
ma
y
be
bo
r
r
o
w
e
d
fr
o
m
an
o
t
h
e
r
or
g
a
n
i
z
a
t
i
o
n
au
t
h
o
r
i
z
e
d
to
co
n
d
u
c
t
bi
n
g
o
.
To
fi
n
d
a
li
c
e
n
s
e
d
di
s
t
r
i
b
u
t
o
r
,
go
to
ww
w
.
m
n
.
g
o
v
/
g
c
b
an
d
cl
i
c
k
on
Di
s
t
r
i
b
u
t
o
r
s
un
d
e
r
th
e
Li
s
t
of
Li
c
e
n
s
e
e
s
ta
b
,
or
ca
l
l
65
1
-
5
3
9
-
1
9
0
0
.
Page 8 of 352
4/
2
3
LG
2
2
0
Ap
p
l
i
c
a
t
i
o
n
fo
r
Ex
e
m
p
t
Pe
r
m
i
t
Pa
g
e
2
of
3
LO
C
A
L
UN
I
T
OF
GO
V
E
R
N
M
E
N
T
AC
K
N
O
W
L
E
D
G
M
E
N
T
(r
e
q
u
i
r
e
d
be
f
o
r
e
su
b
m
i
t
t
i
n
g
ap
p
l
i
c
a
t
i
o
n
to
th
e
Mi
n
n
e
s
o
t
a
Ga
m
b
l
i
n
g
Co
n
t
r
o
l
Bo
a
r
d
)
CI
T
Y
AP
P
R
O
V
A
L
fo
r
a
ga
m
b
l
i
n
g
pr
e
m
i
s
e
s
lo
c
a
t
e
d
wi
t
h
i
n
ci
t
y
li
m
i
t
s
mT
h
e
ap
p
l
i
c
a
t
i
o
n
is
ac
k
n
o
w
l
e
d
g
e
d
wi
t
h
no
wa
i
t
i
n
g
pe
r
i
o
d
.
|:
|
T
h
e
ap
p
l
i
c
a
t
i
o
n
is
ac
k
n
o
w
l
e
d
g
e
d
wi
t
h
a
30
-
d
a
y
wa
i
t
i
n
g
pe
r
i
o
d
,
an
d
al
l
o
w
s
th
e
Bo
a
r
d
to
is
s
u
e
a
pe
r
m
i
t
af
t
e
r
30
da
y
s
(6
0
da
y
s
fo
r
a
ls
t
cl
a
s
s
ci
t
y
)
.
CO
U
N
T
Y
AP
P
R
O
V
A
L
fo
r
a
ga
m
b
l
i
n
g
pr
e
m
i
s
e
s
lo
c
a
t
e
d
in
a
to
w
n
s
h
i
p
CI
Th
e
ap
p
l
i
c
a
t
i
o
n
is
ac
k
n
o
w
l
e
d
g
e
d
wi
t
h
no
wa
i
t
i
n
g
pe
r
i
o
d
.
|:
|
T
h
e
ap
p
l
i
c
a
t
i
o
n
is
ac
k
n
o
w
l
e
d
g
e
d
wi
t
h
a
30
-
d
a
y
wa
i
t
i
n
g
pe
r
i
o
d
,
an
d
al
l
o
w
s
th
e
Bo
a
r
d
to
is
s
u
e
a
pe
r
m
i
t
af
t
e
r
30
da
y
s
.
DT
h
e
ap
p
l
i
c
a
t
i
o
n
is
de
n
i
e
d
.
Pr
i
n
t
Co
u
n
t
y
Na
m
e
:
Th
e
ap
p
l
i
c
a
t
i
o
n
is
de
n
i
e
d
.
Pr
i
n
t
Ci
t
y
Na
m
e
:
(K
W
PW
D
‘
W
Si
g
n
a
re
of
g
y
Pe
r
s
Ti
t
l
e
:
OM
Th
e
ci
t
y
or
co
u
n
t
y
mu
s
t
si
g
n
be
f
o
r
e
su
b
m
i
t
t
i
n
g
ap
p
l
i
c
a
t
i
o
n
to
th
e
Ga
m
b
l
i
n
g
Co
n
t
r
o
l
Bo
a
r
d
.
Si
g
n
a
t
u
r
e
of
Co
u
n
t
y
Pe
r
s
o
n
n
e
l
:
Da
t
e
:
b
-
2H
20
1
%
Ti
t
l
e
:
Da
t
e
:
TO
W
N
S
H
I
P
(i
f
re
q
u
i
r
e
d
by
th
e
co
u
n
t
y
)
On
be
h
a
l
f
of
th
e
to
w
n
s
h
i
p
,
I
ac
k
n
o
w
l
e
d
g
e
th
a
t
th
e
or
g
a
n
i
z
a
t
i
o
n
is
ap
p
l
y
i
n
g
fo
r
ex
e
m
p
t
e
d
ga
m
b
l
i
n
g
ac
t
i
v
i
t
y
wi
t
h
i
n
th
e
to
w
n
s
h
i
p
li
m
i
t
s
.
(A
to
w
n
s
h
i
p
ha
s
no
st
a
t
u
t
o
r
y
au
t
h
o
r
i
t
y
to
ap
p
r
o
v
e
or
de
n
y
an
ap
p
l
i
c
a
t
i
o
n
,
pe
r
Mi
n
n
.
St
a
t
u
t
e
s
,
se
c
t
i
o
n
34
9
.
2
1
3
.
)
Pr
i
n
t
To
w
n
s
h
i
p
Na
m
e
:
Si
g
n
a
t
u
r
e
of
To
w
n
s
h
i
p
Of
f
i
c
e
r
:
Ti
t
l
e
:
Da
t
e
:
CH
I
E
F
EX
E
C
U
T
I
V
E
OF
F
I
C
E
R
'
S
SI
G
N
A
T
U
R
E
(r
e
q
u
i
r
e
d
)
Th
e
in
f
o
r
m
a
t
i
o
n
pr
o
v
i
d
e
d
in
th
i
s
ap
p
l
i
c
a
t
i
o
n
is
co
m
p
l
e
t
e
an
d
ac
c
u
r
a
t
e
to
th
e
be
s
t
of
my
kn
o
w
l
e
d
g
e
.
I
ac
k
n
o
w
l
e
d
g
e
th
a
t
th
e
fi
n
a
n
c
i
a
l
re
p
o
r
t
wi
l
l
be
co
m
p
l
e
t
e
d
an
d
re
t
u
r
n
e
d
to
th
e
Bo
a
r
d
wi
t
h
i
3
da
y
s
ft
h
e
ev
e
.
Da
t
e
:
6
/¢
20
2
Ch
i
e
f
Ex
e
c
u
t
i
v
e
Of
?
c
e
r
'
s
Si
g
n
a
t
u
r
e
:
C?
‘
(S
i
g
n
a
t
u
r
e
mu
s
t
be
C
ig
n
a
t
u
r
e
;
de
s
i
g
n
e
e
ma
y
no
t
si
g
n
)
pr
i
n
t
Na
m
e
:
Re
v
.
Ni
c
h
o
l
a
s
J.
Fr
o
e
h
l
e
RE
Q
U
I
R
E
M
E
N
T
S
Co
m
p
l
e
t
e
a
se
p
a
r
a
t
e
ap
p
l
i
c
a
t
i
o
n
fo
r
:
0
al
l
ga
m
b
l
i
n
g
co
n
d
u
c
t
e
d
on
tw
o
or
mo
r
e
co
n
s
e
c
u
t
i
v
e
da
y
s
;
or
c
al
l
ga
m
b
l
i
n
g
co
n
d
u
c
t
e
d
on
on
e
da
y
.
On
l
y
on
e
ap
p
l
i
c
a
t
i
o
n
is
re
q
u
i
r
e
d
if
on
e
or
mo
r
e
ra
f
f
l
e
dr
a
w
i
n
g
s
ar
e
co
n
d
u
c
t
e
d
on
th
e
sa
m
e
da
y
.
MA
I
L
AP
P
L
I
C
A
T
I
O
N
AN
D
AT
T
A
C
H
M
E
N
T
S
Ma
i
l
ap
p
l
i
c
a
t
i
o
n
wi
t
h
:
a
co
p
y
of
yo
u
r
pr
o
o
f
of
no
n
p
r
o
f
i
t
st
a
t
u
s
;
an
d
ap
p
l
i
c
a
t
i
o
n
fe
e
(n
o
n
-
r
e
f
u
n
d
a
b
l
e
)
.
If
th
e
ap
p
l
i
c
a
t
i
o
n
is
po
s
t
m
a
r
k
e
d
or
re
c
e
i
v
e
d
30
da
y
s
or
mo
r
e
be
f
o
r
e
th
e
ev
e
n
t
,
th
e
ap
p
l
i
c
a
t
i
o
n
fe
e
is
$1
0
0
;
ot
h
e
r
w
i
s
e
th
e
fe
e
is
$1
5
0
.
Ma
k
e
ch
e
c
k
pa
y
a
b
l
e
to
St
a
t
e
of
Mi
n
n
e
s
o
t
a
.
Fi
n
a
n
c
i
a
l
re
p
o
r
t
to
be
co
m
p
l
e
t
e
d
wi
t
h
i
n
30
da
y
s
af
t
e
r
th
e
ga
m
b
l
i
n
g
ac
t
i
v
i
t
y
is
do
n
e
:
Bo
a
r
d
.
To
:
Mi
n
n
e
s
o
t
a
Ga
m
b
l
i
n
g
Co
n
t
r
o
l
Bo
a
r
d
Qu
e
s
t
i
o
n
s
?
Ca
l
l
th
e
Li
c
e
n
s
i
n
g
Se
c
t
i
o
n
of
th
e
Ga
m
b
l
i
n
g
Co
n
t
r
o
l
Bo
a
r
d
at
65
1
-
5
3
9
—
1
9
0
0
.
Yo
u
r
or
g
a
n
i
z
a
t
i
o
n
mu
s
t
ke
e
p
al
l
ex
e
m
p
t
re
c
o
r
d
s
an
d
re
p
o
r
t
s
fo
r
3-
1
/
2
ye
a
r
s
(M
i
n
n
.
St
a
t
u
t
e
s
,
se
c
t
i
o
n
34
9
.
1
6
6
,
su
b
d
.
2(
f
)
)
.
Da
t
a
pr
i
v
a
c
y
no
t
i
c
e
:
Th
e
in
f
o
r
m
a
t
i
o
n
re
q
u
e
s
t
e
d
ap
p
l
i
c
a
t
i
o
n
.
Yo
u
r
or
g
a
n
i
z
a
t
i
o
n
'
s
na
m
e
an
d
me
n
t
of
Pu
b
l
i
c
Sa
f
e
t
y
;
At
t
o
r
n
e
y
Ge
n
e
r
a
l
;
on
th
i
s
fo
r
m
(a
n
d
an
y
at
t
a
c
h
m
e
n
t
s
)
wi
l
l
be
us
e
d
ad
d
r
e
s
s
wi
l
l
be
pu
b
l
i
c
in
f
o
r
m
a
t
i
o
n
wh
e
n
re
c
e
i
v
e
d
Co
m
m
i
s
s
i
o
n
e
r
s
of
Ad
m
i
n
i
s
t
r
a
t
i
o
n
,
Mi
n
n
e
s
o
t
a
by
th
e
Ga
m
b
l
i
n
g
Co
n
t
r
o
l
Bo
a
r
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Page 9 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Shirley Buecksler, City Clerk
Department: Administration
Subject: Temporary On-Sale Liquor License Application for the Church of St. Michael,
September 28-29, 2024
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
The Church of St. Michael has submitted an application for a Temporary On-Sale Liquor License for
an event to be held at the Church of St. Michael on September 28-29, 2024.
DISCUSSION:
Per Minnesota Statutes and the Alcohol & Gambling Enforcement Division (AGE), a Temporary On-
Sale License must first be approved by the City and forwarded to AGE for approval no less than 30
days prior to the event date.
The Church of St. Michael is requesting approval of a Temporary On-Sale Liquor License for an
event to be held at the Church of St. Michael, 22120 Denmark Avenue, Farmington, September 28-
29, 2024.
BUDGET IMPACT:
The State of Minnesota waives all fees for Temporary Liquor Licenses for non-profit organizations;
therefore, the City of Farmington has not established a fee for this type of license.
ACTION REQUESTED:
Approve the attached Temporary On-Sale Liquor License for an event to be held at the Church of
St. Michael, 22120 Denmark Avenue, Farmington, September 28-29, 2024.
ATTACHMENTS:
Temp On-Sale Liquor, Church of St. Michael Sep 28-29, 2024
Application for Gambling Permit, Church of St. MIchael
Page 10 of 352
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Page 12 of 352
Page 13 of 352
Page 14 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Shirley Buecksler, City Clerk
Department: Administration
Subject: Minutes of the June 17, 2024 Regular City Council Meeting
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
For Council review are the minutes of the June 17, 2024 Regular City Council meeting.
ACTION REQUESTED:
Approve the minutes of the Regular City Council meeting dated June 17, 2024
ATTACHMENTS:
06.17.24 Council Minutes
Page 15 of 352
Regular City Council Meeting Minutes of June 17, 2024 Page 1 of 8
City of Farmington
Regular Council Meeting Minutes
Monday, June 17, 2024
The City Council met in regular session on Monday, June 17, 2024, at Farmington City
Hall, 430 3rd Street, Farmington, Minnesota.
1. CALL TO ORDER
Mayor Hoyt called the meeting to order at 7:00 p.m.
2. PLEDGE OF ALLEGIANCE
Mayor Hoyt led everyone in the Pledge of Allegiance.
3. ROLL CALL
Members Present: Mayor Joshua Hoyt
Councilmembers Holly Bernatz, Katie Bernhjelm, Nick Lien,
and Steve Wilson
Members Absent: None
Staff Present: Lynn Gorski, City Administrator
Julie Flaten, Asst City Administrator/HR Director
Leah Koch, City Attorney
Deanna Kuennen, Community & Economic Development Director
Tony Wippler, Planning Manager
Kim Sommerland, Finance Director
Matt Price, Fire Chief
Kellee Omlid, Parks & Recreation Director
Gary Rutherford, Police Chief
John Powell, Public Works Director
Kari Kubicek, Regional Funding Manager
Shirley Buecksler, City Clerk
4. APPROVE AGENDA
Administrator Gorski requested to:
• Add Item 7.12, Donation of $15,000 from the Farmington Fire Relief Association
to the City of Farmington
Motion was made by Councilmember Wilson and seconded by Councilmember
Bernhjelm to add Item 7.12 and approve the agenda, as amended.
Motion carried: 5 ayes / 0 nays
Page 16 of 352
Regular City Council Meeting Minutes of June 17, 2024 Page 2 of 8
5. ANNOUNCEMENTS / COMMENDATIONS
5.1 Introduction of Regional Funding Manager Kari Kubicek
Administrator Gorski introduced Kari Kubicek, Reg ional Funding Manager with
Southeast Services Cooperative, who shared information about her position.
Council welcomed Kari to the City of Farmington.
6. CITIZENS COMMENTS / RESPONSES TO COMMENTS
• Nathan Ryan, 22390 Cambrian Way, addressed the Council regarding
potential rezoning of the golf course and school district properties and
expressed that he is not in favor of it.
• Jeff Schottler, 22420 Calico Court, addressed the Council regarding the
same topic and expressed that he is not in favor.
7. CONSENT AGENDA
7.1 Gambling Event Permit Application for Farmington Rotary Club
7.2 Minutes of the City Council Work Session dated June 3, 2024
7.3 Minutes of the Regular City Council Meeting dated June 3, 2024
7.4 Minutes of the Joint Planning Commission and City Council Work Session dated
June 4, 2024
7.5 Payment of Claims
7.6 Community Service Officer Job Description and Compensation Classification
7.7 Staff Changes and Recommendations, including the appointment of:
• Torri Wolf as Senior Administrative Support Technician
• Sue Bastian as a Temporary Elections Assistant
7.8 Donation of Flowers for Downtown from the Farmington Rotary;
Resolution 2024-52
7.9 Professional Services Agreements with Advanced Engineering and
Environmental Services (AE2S) for the Farmington East and Farmington West
Serviceability Analysis
7.10 Professional Services Agreement with Alliant Engineering, Inc. for the Dushane
Parkway/Spruce Street Intersection Final Design
7.11 Purchase of a Dump Truck Cab and Chassis
7.12 Donation of $15,000 from the Farmington Fire Relief Association to the City of
Farmington
Motion was made by Councilmember Bernhjelm and seconded by Councilmember
Lien to approve the Consent Agenda, as presented.
Motion carried: 5 ayes / 0 nays
8. PUBLIC HEARINGS
9. AWARD OF CONTRACT
Page 17 of 352
Regular City Council Meeting Minutes of June 17, 2024 Page 3 of 8
10. PETITIONS, REQUESTS AND COMMUNICATIONS
10.1 Petition to Rezone Properties from MUCI (Mixed Use Commercial / Industrial to I
(Industrial); the Subject Properties are Generally Located at the Southeast
Intersection of Pilot Knob Road and 208th Street West
The applicant, R&L Carriers, submitted a petition for the rezoning of two parcels
of land. The subject parcels are: 1. PID# 14 -25852-00-010 (Outlot A Farmington
Industrial Park 3rd Addition) 2. PID# 14 -25852-00-020 (Outlot B Farmington
Industrial Park 3rd Addition).
Motion was made by Councilmember Bernatz and seconded by Councilmember
Lien to pass Ordinance 2024-07 Amending Title 10 of the Farmington City Code,
the Farmington Zoning Ordinance, Rezoning the Parcels with P ID Numbers 14-
25852-00-010 and 14-25852-00-020 from MUCI (Mixed Use Commercial /
Industrial) to I (Industrial).
Motion carried: 5 ayes / 0 nays
10.2 Vermillion Commons 4th Addition Preliminary Plat and Planned Unit Development
The developer proposes 68 single-family lots and 66 townhome lots on 20.3 net
acres (26 acres gross) of land with a net density of 6.6 units per acre. The
single-family lots are located on the north and west side of the development and
the townhomes units are located at the southeast side of the development.
Stormwater ponding will be located on the west side of the development, adjacent
to the Dakota County Conservation Area. The minimum lot area proposed for the
single-family lots is 4,800 square feet with an overall average lot size of 6,198
square feet in the development. The minimum lot width and depth of the single -
family lots will be 40 feet and 120 feet, respectively.
Motion was made by Councilmember Bernatz and seconded by Councilmember
Bernhjelm to adopt Resolution 2024-53 Approving Preliminary Plat and Planned
Unit Development Vermillion Commons 4th Addition.
Motion carried: 5 ayes / 0 nays
11. UNFINISHED BUSINESS
12. NEW BUSINESS
12.1 Resolution 2024-51 Adopting a Final Order and Record of Decision for an
Alternative Urban Areawide Review (AUAR) for the Farmington West Industrial
Project
Minnesota Rules 4410 authorize the Responsible Unit of Government (RGU) to
use the Alternative Urban Areawide Review (AUAR) process to review the
potential environmental impacts associated with anticipated development projects
Page 18 of 352
Regular City Council Meeting Minutes of June 17, 2024 Page 4 of 8
in geographically defined areas. The process and requirements for the AUAR are
specifically identified, including timelines associated with the various steps.
Farmington West Industrial encompasses 329 acres located northwest of the
intersection of County Road 50 and Pilot Knob Road. In April, an AUAR Scoping
Document was published in the Minnesota Environmental Quality Board (EQB)
Monitor for this site/project. The 30- day comment period expired, comments were
received by five (5) agencies, and the next step associated with the Farmington
West Industrial AUAR is for the RGU to determine that the AUAR is the
appropriate environmental review document and order that an AUAR be prepared.
An AUAR is a planning tool to understand how different development scenarios
will affect the environment before the development occurs. Minnesota Rule 4410
specifically identifies when a review is required, who manages the process, what
topics are covered in the review, and what happens following adoption of an
AUAR. An AUAR is being developed for an area encompassing approximately
329 acres, including six (6) parcels, located northwest of the intersection of
County Road 50 and Pilot Knob Road in Farmington. The area is being studied to
understand the potential impacts associated with developing the existing farmland
into a technology park or industrial uses and to identify mitigation measures to
compensate for those impacts.
An AUAR Scoping Document was prepared for this site for the two development
scenarios, was reviewed and distributed to required state and federal agencies,
and a notice of availability of the AUAR Scoping Document was published in the
EQB Monitor for the required 30-day comment period which ended on May 16,
2024. During this time comments were received by five (5) agencies - which were
included in the document in the Council’s packet. The purpose of the comment
period is for agencies to suggest additional development scenarios and relevant
issues to be analyzed in the review. The next step is for the RGU to make a finding
on the adequacy of the Scoping Document and adopt the Final Order. These
actions will determine that the AUAR is the appropriate environmental review and
order that the AUAR and mitigation plan be prepared as identified. Once the RGU
adopts the order to prepare the AUAR, the next steps include:
1. The AUAR is developed.
2. RGU reviews and distributes Draft AUAR and Mitigation Plan for public and
agency review for the mandatory 30-day review period.
3. RGU revises Draft AUAR and Mitigation Plan based on comments from
public and agencies.
4. RGI distributes Final AUAR and Mitigation Plan to agencies and Met-
Council for final 10-day review period.
5. If no objections, RGU Adopts Final AUAR and Mitigation Plan.
6. RGU updates the AUAR every 5-years until development build-out is
complete.
Page 19 of 352
Regular City Council Meeting Minutes of June 17, 2024 Page 5 of 8
Motion was made by Councilmember Bernhjelm and seconded by
Councilmember Lien to adopt Resolution 2024-51 Adopting Final Order for
Alternative Urban Areawide Review (AUAR) for West Industrial Project.
Motion carried: 5 ayes / 0 nays
13. CITY COUNCIL ROUNDTABLE
Attorney Koch:
Welcome to Kari. Also Happy Father’s Day to all the dads out there.
Councilmember Lien:
Please be safe this week with all the activities.
Councilmember Bernatz:
It’s Dew Days week. Events start tomorrow. Visit FarmingtonDewDaysMN.com is
where you can find all the information. Rain or shine, most everything will be
happening. This is something that a volunteer committee , made up of a whole
bunch of residents who care very deeply for the Farmington community, has worked
tirelessly on for about the last nine months to bring you a great festival. Please
come out, even if it’s just for a couple of hours, the whole week, or the entire
weekend. It will be a great time.
Councilmember Bernhjelm:
Having been back for the last couple weeks, I’m reminded of how amazing the Staff
here is at City Hall and how helpful you all have been re-onboarding me with
everything that’s going on. I am continuously impressed by all of your hard work
and the dedication you put into prepping for every one of these meetings. I
appreciate all of you – keep it up.
Councilmember Wilson:
Happy Harry’s has a program where they allow customers to point out that they
want ten percent of the profits donated back to the Rambling River Center. My Mom
desperately needed a lift chair for her residence, so we purchased a chair at Happy
Harry’s and was happy to donate to the program, the chair got delivered beautifully,
and the old chair was hauled out. I ’m really appreciative of businesses like this in
our community that support the senior center and support so many other great
things that we have going on. Thank you.
Clerk Buecksler:
It’s time to start talking about absentee voting again. For the State Primary in
August, absentee voting starts a week from Friday, on June 28 th. Any residents
living within the Farmington city limits can vote by absentee at Farmington City Hall,
or any Dakota County office, or if they wish to apply online, they can go to
mnvotes.org. Residents who have a Farmington address but live in Lakeville vote
in Lakeville. Residents who live in a township vote at either the township or the
County office, depending on where that voting is done. Residents can find their
polling location by visiting mnvotes.org.
Page 20 of 352
Regular City Council Meeting Minutes of June 17, 2024 Page 6 of 8
Director Kuennen:
A reminder that on July 16th at 8 am here at City Hall, we will be hosting our first
Small Business Resource Fair. Invitations will be going out to the list of small
businesses that we have, but definitely spread the word. The purpose behind this
resource fair is to make sure our existing small businesses understand the variety
of resources and agencies that are available to help them with their own business
growth or development goals. Having that information in one place at one time in a
no pressure setting is our hope that people find value in it and walk away with some
ideas or some contact information for people who can help them achieve whatever
it is they’re looking to do.
Director Powell:
McKenna Rodine started as our Water Resources Specialist a week ago today and
hit the ground running. Given her background with the MPCA and storm water
permits, she is deep into reviewing every aspect of our draft MS4 permit, and we
are really happy to have her on board.
Director Omlid:
Unfortunately, there will be no Open Door food pop-up at the Rambling River Center
tomorrow due to the predicted forecast of rain, so it has been cancelled, but they
will be here in July.
Dew Days is this weekend. Parks and Recreation does a number of programs,
starting with the Dew Run on Saturday morning. You can still register online today
or in person on Saturday. First race starts at 8 am.
The bike auction is Saturday under the big tent. Viewing at 11 am, live bidding with
an auctioneer starts at 11:30 am.
Police Chief Rutherford is a Kiss the Pig contest candidate. Still time to vote with
your bills, dollars, or credit card. He’s one of five candidates, so we’d love to see
him kiss Betty on Saturday at 4 pm under the big tent.
Please come out and support Parks and Recreation programs and all the other
awesome events this weekend.
Director Sommerland:
I am happy to report that we are finalizing the audit of our 2023 financials. So MMKR
should be here at the next meeting to present that information to Council. And we
are beginning our internal budget discussions starting tomorrow.
Chief Price:
We took ownership of our tender. We have done a week’s worth of training and
we’re waiting for some major equipment to actually put it in service before our old
tender goes down the road.
Page 21 of 352
Regular City Council Meeting Minutes of June 17, 2024 Page 7 of 8
Chief Rutherford:
To echo a couple of comments, Dew Days is this weekend. Depending on the
weather, there will be hundreds, if not thousands, of pedestrians walking around
downtown at all hours of the day and night, so please be careful as you’re driving
around in the general area. There will be a lot more pedestrians than we’re used to
seeing. Drink responsibly and have a plan to get home safely.
I do not have a great, huge burning desire to kiss a pig, but whether you vote for
me or any of the other four candidates, it all goes to a fantastic cause, the Rambling
River Center. Vote early and vote often.
Mayor Hoyt:
Dew Days – it’s a big week and there are a lot of events. The medallion hunt started
already, Thursday night is technically the big kickoff for events downtown, but
there’s a lot of stuff scheduled between Thursday, Friday, Saturday, and
culminating with the parade on Sunday. For me personally, the one event I think
often gets missed, and it’s a great opportunity, is the Ambassador Coronation.
The Ambassador Coronation is tomorrow night at Homestead Community Church
and starts at 6:30 pm. These are young women every year that raise their hand to
go out as ambassadors for the greater Farmington community. They go to dozens
of parades and about 50 events, they work in this position all year long from their
coronation all the way through the end of their season. The amount of time that they
spend – it’s another sport or another activity and is all about spreading awareness
and the good aspects of the Farmington area. I know this event gets missed
because every year it could be three times the amount of attendance. It’s great to
see parents and supporters of these young women doing this, but it would be great
to see the Farmington community show up for them because they are showing up
for us week in and week out for several months out of the year. If you don’t have
plans tomorrow night, go to Homestead Community Church, it starts at 6:30 pm,
and is the best 60-75 minutes you’ll have because there is so much pride in these
women and what they do. Again, they are ambassadors , for a reason they’re not
called princesses, so if you do anything, please attend that event.
To the Chief’s point of safety, there is a lot of stuff going on downtown. Please be
responsible, not only for property but for other people. We’ve had some pretty
decent years, so let’s continue that and be the respectful people that I know we can
be. Support your businesses when you’re downtown, do all the things, have fun,
but be responsible. There’s something for everyone, and if you find there’s not
something for you, then feel free to raise your hand and step forward to the
committee for next year because I know that they are not turning volunteers away.
There’s always a need to add more people to help make all these amazing
opportunities and events happen.
Page 22 of 352
Regular City Council Meeting Minutes of June 17, 2024 Page 8 of 8
14. ADJOURNMENT
Motion was made by Councilmember Wilson and seconded by Councilmember
Bernatz to adjourn the meeting at 8:00 pm.
Motion carried: 5 ayes / 0 nays
Respectfully submitted,
Shirley R Buecksler
City Clerk
Page 23 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Shirley Buecksler, City Clerk
Department: Administration
Subject: Minutes of the June 17, 2024 Special Work Session
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
For Council review are the minutes of the June 17, 2024 Special Work Session.
ACTION REQUESTED:
Approve the minutes of the Special Work Session dated June 17, 2024.
ATTACHMENTS:
06.17.24 Work Session Minutes
Page 24 of 352
Special Work Session Minutes of June 17, 2024 Page 1 of 2
City of Farmington
City Council Special Work Session Minutes
Monday, June 17, 2024
The City Council met in a Special Work Session on Monday, June 17, 2024, at Farmington
City Hall, 430 3rd Street, Farmington, Minnesota.
1. CALL TO ORDER
Mayor Hoyt called the Work Session to order at 5 pm.
Members Present: Mayor Joshua Hoyt
Councilmembers Holly Bernatz, Katie Bernhjelm, Nick Lien, and
Steve Wilson
Members Absent: None
Staff Present: Lynn Gorski, City Administrator
Julie Flaten, Asst City Administrator/HR Director
Deanna Kuennen, Community & Economic Development Director
Tony Wippler, Planning Manager
Kellee Omlid, Parks & Recreation Director
John Powell, Public Works Director
Kari Kubicek, Regional Funding Manager
Shirley Buecksler, City Clerk
Also Present: Planning Commissioners:
Chair Dirk Rotty, Commissioners LeeAnn Lehto and Krista Tesky
Rita Trapp, Vice President, HKGi
Jake Cordes, Resident
2. APPROVE AGENDA
The agenda was approved, as presented.
3. DISCUSSION ITEMS
3.1 Draft Updated Land Use Plan – 2040 Comprehensive Plan Update
Planning Manager Wippler presented. Council held a Joint Work Session with
the Planning Commission on March 4, 2024 to discuss the status of the 2040
Comprehensive Plan Amendment, including the land use maps. At that work
session, it was made clear that additional land should be designated and guided
for commercial and industrial uses.
Staff and HKGi have worked to update the land use maps . A couple areas to
note that have been changed since the March work session are:
Page 25 of 352
Special Work Session Minutes of June 17, 2024 Page 2 of 2
• The northwest area of the city off of Flagstaff Avenue - additional land
guidance was provided in this area for Mixed-Use Commercial/Industrial, Low
Medium Density Residential, Medium Density Residential, High Density
Residential and Commercial.
• The downtown area was expanded to the east and south.
• Additional commercial provided in the Fairhill development north of 190th
Street West.
The land use maps will ultimately be used to update the various infrastructure
system plans.
Council and the Planning Commission asked questions and received answers.
4. COUNCIL COMMITTEE UPDATE
Councilmember Bernhjelm sat in on the Airlake Airport Advisory Commission meeting
and suggested Farmington join these meetings when discussion is applicable to
Farmington.
Councilmember Wilson said Joshua Threet, President of the Farmington Fire Relief
Association, is doing a great job.
5. CITY ADMINISTRATOR UPDATE
Administrator Gorski met with ISD 192 Superintendent Jason Berg and Farmington
School Board Chair Hannah Simmons, and they would like to schedule a joint meeting
with the City Council. Gorski sent an email to Council today with some possible dates
for this meeting.
The Office of Cannabis Management is moving forward with licensing by the e nd of
July. Staff is recommending approval of a moratorium to prohibit license approval to
sell cannabis until January 1, 2025. The moratorium will provide time to develop
policies and zoning regulations prior to approval. The moratorium will be on the July 1,
2024 Council meeting to provide public comment and approval by City Council.
6. ADJOURNMENT
Motion was made by Councilmember Lien and seconded by Councilmember Bernatz
to adjourn the meeting at 6:24 p.m.
Motion carried: 5 ayes / 0 nays
Respectfully submitted,
Shirley R Buecksler
City Clerk
Page 26 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Shirley Buecksler, City Clerk
Department: Administration
Subject: Resolution Approving a Second Amendment to the Appointments to Council
Committees for the Remainder of Calendar Year 2024
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
Second amendment to Council committee appointments through December 31, 2024.
DISCUSSION:
Councilmember Katie Bernhjelm was appointed on June 3, 2024 to fill the seat vacated by Katie
Porter.
At their July 1st Work Session, Council discussed a second amendment to the 2024 Council
committee appointments and directed Staff to bring forward a resolution for adoption at tonight's
Regular City Council Meeting. In the Council's packet is a draft resolution, with appointments to be
completed with direction following the work session.
ACTION REQUESTED:
Adopt Resolution 2024-57 Approving a Second Amendment to Appointments to Council
Committees for Remainder of 2024.
ATTACHMENTS:
2024-57 Approving a Second Amendment to the Appointments to Council Committees for
Remainder of 2024
Page 27 of 352
CITY OF FARMINGTON
DAKOTA COUNTY, MINNESOTA
RESOLUTION 2024-57
A RESOLUTION APPROVING A SECOND AMENDMENT TO THE APPOINTMENTS
TO COUNCIL COMMITTEES FOR THE REMAINDER OF CALENDAR YEAR 2024
WHEREAS, the City Council adopted Resolution 2024-05 Approving Appointments to
Council Committees for 2024 at their Special Council Organizational Meeting on January 2, 2024;
and
WHEREAS, with the resignation of Katie Porter on May 6, 2024, Council adopted
Resolution 2024-39 Approving an Amendment to Council Committees for the Remainder of 2024;
and
WHEREAS, Katie Bernhjelm was appointed as Councilmember on June 3, 2024 to fill
the seat vacated by Katie Porter; and
WHEREAS, appointments to public agencies are hereby amended as follows:
PUBLIC AGENCY MEMBER(S) APPOINTED
Airlake Airport Advisory Commission Holly Bernatz – Primary
____________ - Alternate
ALF Ambulance
(Apple Valley/Lakeville/ Farmington)
Steve Wilson – Primary
Nick Lien – Alternate
Dakota 911 Board of Directors Nick Lien – Primary
Steve Wilson - Alternate
EFPAC
Empire/Farmington Planning Advisory Committee
Joshua Hoyt – Primary
____________ - Alternate
Eureka/Farmington Planning Advisory Committee Holly Bernatz - Primary
Joshua Hoyt – Alternate
Farmington/Castle Rock Discussion Group Joshua Hoyt – Primary
Steve Wilson – Alternate
Fire Relief Board Steve Wilson
Nick Lien
Liquor Operations Committee Holly Bernatz
____________
Page 28 of 352
Resolution 2024-57
Page 2 of 2
PUBLIC AGENCY MEMBER(S) APPOINTED
MUSA Review Committee
(Metropolitan Urban Service Area)
Holly Bernatz
Nick Lien
NOW, THEREFORE, BE IT RESOLVED that the Farmington City Council approves
the amended appointments to public agencies as outlined herein effective July 1, 2024 through
December 31, 2024.
Adopted by the City Council of the City of Farmington, Minnesota, this 1st day of July 2024.
ATTEST:
____________________________ ______________________________
Joshua Hoyt, Mayor Shirley R Buecksler, City Clerk
Page 29 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Deanna Kuennen, Community Dev Director
Department: Community Development
Subject: Resolution 2024-59 Amending Resolution 2024-43 Approving and Authorizing
Execution of an Abatement Agreement with Apartments Farmington, LLC
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
On May 20, 2024, a public hearing was held regarding tax abatement to support the construction of
a 168-unit multi-family residential project located on Lot 2, Block 1, Vermillion River Crossing 3rd
Addition. At the conclusion of the public hearing, the City Council approved the tax abatement
proposal to support the development of additional housing in the city and authorized the execution
of the Abatement Agreement (Resolution 2024-43). Since then, additional negotiations have
transpired between the City and the Developer - which did not change the essential form of the
agreement but did include the correct legal description of the property and shift the abatement
timeline. The City Council is asked to approve and execute the Abatement Agreement now in its
final form.
DISCUSSION:
Staff has been working with the Yellow Tree Development Team since last year regarding the
development of a market-rate multi-family development in Farmington. After multiple work sessions
and the City Council's request to redesign the adjacent road network (to eliminate the "square-
about"), the developer finalized their plans, completed the Planning & Zoning entitlement process,
and submitted a business subsidy request to support the development of a 168-unit market-rate,
$42 million multi-family housing development. A public hearing was held on May 20, 2024 - and the
City Council approved a tax abatement package to support the development (Resolution 2024-43).
Since then, additional negotiations have transpired between the City and the Developer. These
negotiations did not change the essential form of the tax abatement agreement, but instead
corrected the legal description of the property and shifted the abatement timeline. The final tax
abatement agreement is attached.
BUDGET IMPACT:
Not applicable
ACTION REQUESTED:
Approve Resolution 2024-59, Amending Resolution 24-43 Approving Tax Abatement and
Authorizing the Execution of the Abatement Agreement.
ATTACHMENTS:
Page 30 of 352
Resolution 2024-59 Amending Resolution 2024-43 (with Exhibit A - Abatement Agreement)
Page 31 of 352
CITY OF FARMINGTON
DAKOTA COUNTY, MINNESOTA
RESOLUTION 2024-59
A RESOLUTION AMENDING RESOLUTION 2024-43
WHEREAS, Apartments Farmington, LLC (the “Developer”) desires to purchase certain
real property identified as Lot 2, Block 1, Vermillion River Crossing 3rd Addition, Dakota
County, Minnesota (the “Property”) on which the Developer will re-plat and construct a 168-unit
multi-family residential building located on the Property (the “Project”); and
WHEREAS, the City of Farmington (the “City”), pursuant to Minnesota Statutes
Sections 469.1812 to 469.1815, as amended (“Abatement Act”), is authorized to grant an
abatement of the property taxes imposed by the City on parcels of property located within the
city, if certain conditions are met, through the adoption of a resolution, specifying the terms of
the abatement; and
WHEREAS, to support the development of additional housing in the city, the Developer
has requested a tax abatement agreement (“Abatement Agreement”) for the Project; and
WHEREAS, the City is proposing to abate the property taxes imposed by the City with
respect to the Property; and
WHEREAS, a public hearing on the abatement was held on Monday, May 20, 2024 and
the notice for the public hearing was published at least once more than ten days but less than 30
days before the hearing; and
WHEREAS, the City adopted Resolution 2024-43 on May 20, 2024 to approve and
authorize the execution of the Abatement Agreement; and
WHEREAS, the City and the Developer engaged in additional negotiation regarding the
Abatement Agreement which did not change the essential form of the agreement, but did include
the correct legal description for the Property, among other changes to shift the abatement’s
timeline; and
WHEREAS, the final Abatement Agreement is attached as Exhibit A.
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of
Farmington that:
1. The City Council expects that the benefits the City gains from the abatement will
either match or exceed the costs it incurs.
2. The City Council finds that the use of tax abatement for the Project is in the public
interest as it will increase the tax base.
Page 32 of 352
Resolution 2024-59
Page 2 of 2
3. The City Council hereby approves the Abatement Agreement in substantially the
form submitted, and the Mayor and City Clerk are hereby authorized and directed to
execute the Abatement Agreement on behalf of the Council.
4. The approval hereby given to the Abatement Agreement includes approval of such
additional documents therein as may be necessary and appropriate to effectuate the
Agreement.
Adopted by the City Council of the City of Farmington, Minnesota, this 1st day of July 2024.
ATTEST:
____________________________ ______________________________
Joshua Hoyt, Mayor Shirley R Buecksler, City Clerk
Page 33 of 352
Resolution 2024-59
Page 2 of 2
EXHIBIT A
Page 34 of 352
Resolution 2024-59
Page 2 of 2
TAX ABATEMENT AGREEMENT
THIS AGREEMENT, made on or as of the ______ day of ______, 2024 (“Effective
Date”), by and between the CITY OF FARMINGTON, a Minnesota municipal corporation (the
"City") and APARTMENTS FARMINGTON, LLC, a Minnesota limited liability company
(the “Developer”) or its assigns.
WITNESSETH:
WHEREAS, Developer has entered into a purchase agreement for acquisition of real
property located in the City of Farmington, legally described in Exhibit A (the “Property”);
WHEREAS, the Developer proposes to construct a 168 unit market-rate rental apartment
building on the Property (the “Project”);
WHEREAS, Developer has indicated that construction of the Project would not occur on
the Property but for tax abatement assistance from the City;
WHEREAS, pursuant to Minnesota Statutes, Sections 469.1812 to 469.1815, as
amended (“Tax Abatement Act”), the City may grant an abatement of the taxes imposed by such
governmental units on parcels of property, subject to certain conditions set forth in such Act;
WHEREAS, because financial assistance for housing is not a business subsidy, the tax
abatement for the Project provided by the City does not constitute a business subsidy. Minnesota
Statutes, Sections 116J.993 subd. 3(7);
WHEREAS, the City held a public hearing on the tax abatement following more than 10
days’ but less than 30 days’ published notice;
WHEREAS, the City believes that the development and construction of the Project, and
fulfillment of this Agreement are vital and are in the best interests of the City and will result in
preservation and enhancement of the tax base, provide housing opportunities and are in
accordance with the public purpose and provisions of the applicable state and local laws and
requirements under which the Project has been undertaken and is being assisted;
WHEREAS, the City desires to pledge tax abatement to encourage development of the
Project;
WHEREAS, the Project is not located within a tax increment financing district; and
WHEREAS, the City believes that the Project and fulfillment generally of this
Agreement is in the best interest of the City and the health, safety, morals and welfare of the
residents of the City and the benefits of such abatement will equal or exceed its costs, and
applicable state and local laws and requirements.
Page 35 of 352
Resolution 2024-59
Page 2 of 2
NOW, THEREFORE, each party does hereby covenant and agree with the others as
follows:
ARTICLE I.
DEFINITIONS
In this Agreement, unless a different meaning clearly appears from the context:
"Agreement" means this Tax Abatement Agreement between the City and the
Developer, as the same may be from time to time modified, amended or supplemented.
"Articles and Sections" mentioned by number only are the respective Articles and
Sections of this Agreement so numbered.
“Business Day” means any day except a Saturday, Sunday or a legal holiday or a day on
which banking institutions in the City are authorized by law or executive order to close;
"City" means the City of Farmington, Minnesota.
“Contract” means the Development Agreement for the Property to be executed at a
future date.
“City Tax Abatement” means the City’s Tax Abatement as described in Article 3.4
hereof and as authorized by the City Tax Abatement Resolution, pursuant to the Tax Abatement
Act.
"Developer" means Apartment Farmington LLC, a Minnesota limited liability company,
or its assigns.
"Event of Default" means an action by the Developer listed in Article IV of this
Agreement.
“Minimum Improvements” means the construction of a 168 unit market rate rental
apartment building on the Property.
"Parties" means the Developer and City.
"Party" means one of the following: Developer or City.
"Project" means the acquisition by Developer of the Property and the construction of an
approximately 168 unit residential building on the Property in accordance with the Contract,
plans and specifications approved by the City and all applicable local, state and federal
regulations.
"State" means the State of Minnesota.
Page 36 of 352
Resolution 2024-59
Page 2 of 2
“Substantial Completion” means the stage in the progress of construction of Project
where the work is sufficiently complete in accordance with the plans approved under this
Agreement that a certificate of occupancy or temporary certificate is issued.
“Tax Abatement” means the City Tax Abatement of ad valorem real estate taxes levied
on the Project by the City as provided in the City’s Tax Abatement Resolution and this
Agreement, and as authorized by the Tax Abatement Act.
“Tax Abatement Act” means Minnesota Statutes, Sections 469.1812 through 469.1815,
as amended from time to time.
"Unavoidable Delays" means delays outside the control of the Party claiming its
occurrence which are the direct result of strikes, other labor troubles, unusually severe or
prolonged bad weather, Acts of God, epidemics, terrorism, fire or other casualty to the Project,
litigation commenced by third parties which, by injunction or other similar judicial action,
directly results in delays, or acts of any federal, state or local governmental unit (other than the
City) which directly result in delays. Unavoidable delays shall not include delays in the
Developer's obtaining permits or governmental approvals necessary directly to enable
construction of the Project.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES
Section 2.1. Representations and Warranties by the City. The City represents and
warrants that:
(a) The City is a Minnesota municipal corporation duly organized and
existing under the laws of the State of Minnesota. Under the laws of the State, the City has the
power to enter into this Agreement and carry out its obligations hereunder.
(b) The City Tax Abatement is consistent with the criteria established in the
Tax Abatement Statute.
(c) The City has made the findings required by the Tax Abatement Act for
issuance of the Tax Abatement.
Section 2.2. Representations and Warranties by the Developer. The Developer
represents and warrants that:
(a) The Developer is a limited liability company duly organized and operating
under the laws of the State of Minnesota, has the power to enter into this Agreement, and has
duly authorized the execution, delivery, and performance of this Agreement by proper action of
its Manager(s).
(b) The Developer will acquire the Property and cause the Project to be
constructed, operated and maintained in accordance with the terms of this Agreement, the terms
Page 37 of 352
Resolution 2024-59
Page 2 of 2
of the Contract, and all local, state and federal laws and regulations (including, but not limited to,
environmental, zoning, building code and public health laws and regulations including the
America with Disabilities Act).
(c) The acquisition of the Property and construction of the Project would not
be undertaken by the Developer, and in the opinion of the Developer would not be economically
feasible within the reasonably foreseeable future, without the assistance and benefit to the
Developer provided for in this Agreement.
(d) The Developer will obtain, in a timely manner, all required permits,
licenses and approvals and to meet, in a timely manner, all requirements of all applicable local,
state and federal laws and regulations which must be obtained or met before the Project may be
lawfully constructed.
(e) The Developer will cooperate with the City with respect to any litigation
commenced with respect to the Property or the Project.
(f) Neither the execution and delivery of this Agreement, the consummation
of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and
conditions of this Agreement is prevented, limited by or conflicts with, or results in a breach of,
the terms, conditions or provisions of any corporate restriction or any evidences of indebtedness,
agreement or instrument of whatever nature to which the Developer is now a party or by which it
is bound or constitutes a default under any of the foregoing.
(g) Whenever any Event of Default occurs and if the City shall employ
attorneys and engineers or incur and pay for expenses for the collection of payments due or to
become due or for the enforcement of performance or observance of any obligation or agreement
on the part of the Developer under this Agreement, the Developer agrees that it shall, within ten
(10) days of written demand by the City, pay to the City the reasonable fees of such attorneys
and such other expenses so incurred and paid for by the City.
ARTICLE III.
UNDERTAKINGS OF DEVELOPER AND TAX ABATEMENT
Section 3.1. Construction of the Project.
(a) The Developer agrees that it will: (i) acquire the Property by May 20,
2025 and will construct the Project on the Property in accordance with construction plans and
specifications approved by the City, (the “Construction Plans”); (ii) operate the Project; (iii)
maintain, preserve and keep the Project or cause the Project to be maintained, preserved and kept
with the appurtenances and every part and parcel thereof in compliance with applicable
governmental regulations.
Section 3.2. Construction of Improvements. The Developer shall commence
construction of the Project no later than May 20, 2025 and shall substantially complete
construction of the Project by November 30, 2026, subject to extensions approved by the City
Page 38 of 352
Resolution 2024-59
Page 2 of 2
and Unavoidable Delays. All work shall be in conformity with the Plans and Specifications as
submitted by the Developer and approved by the City pursuant to the Contract.
Section 3.3. Damage and Destruction. In the event of damage or destruction of the
Project the Developer shall repair or rebuild the Project.
Section 3.4. Tax Abatement Program.
(1) The Tax Abatement paid to the Developer shall be in accordance with and subject
to the terms and conditions contained in the Abatement Resolution and the Tax Abatement Act.
As the City implements this Agreement, all calculations and the implementation of those
calculations shall be determined by the City in its sole discretion.
(2) The Tax Abatement shall be for a duration of not to exceed 10 years and shall
apply to the percentage of the increased portions of the City’s share of ad valorem property taxes
imposed on the Property derived from the value of the Project over the adjusted 2025 Market
Value for taxes collected in 2025 as established by the County Assessor’s Office in which the
City receives taxes from the Property and paid by the Developer as follows:
(a) The City will abate 100% of the increased portion of the City’s share of ad
valorem property taxes beginning with taxes payable in 2027 and continuing through taxes
payable in 2031 on the Property;
(b) The City will abate 75% of the increase portion of the City’s share of ad
valorem taxes beginning with taxes payable in 2032 and continuing through taxes payable in
2036 on the Property.
(3) In no event shall the cumulative amount abated exceed an amount equal to
$1,172,000.00 together with simple, non-compounding interest from the date a Certificate of
Occupancy is issued for the Property at a rate of Six and 00/100 percent (6%) per annum through
the ten year anniversary of the issuance of Certificate of Occupancy but no later than February 1,
2037.
(4) On or before February 1 and August 1 each year commencing August 1, 2027 to
February 1, 2037, the City shall pay the Developer the amount of the Tax Abatement received by
the City in the previous six-month period.
(5) In order to be entitled to the Tax Abatement provided for in this Agreement, the
Developer shall not be in default within the City of any of its payment obligations respecting any
taxes, assessments, utility charges or other governmental impositions. Notwithstanding the other
provisions in this Article, the City shall not have any obligation to the Developer with respect to
the Abatement of taxes hereunder if the City, at the time or times such obligation is required, is
entitled to exercise any of the remedies set forth in this Agreement as a result of an Event of
Default, which has not been cured.
Page 39 of 352
Resolution 2024-59
Page 2 of 2
(6) The City may terminate the Tax Abatement Program and this Agreement on an
earlier date if any Event of Default occurs and the City rescinds or cancels this Agreement.
(7) The foregoing notwithstanding, the City shall not have the right to terminate the Tax
Abatement Program and/or this Agreement for an Event of Default of Developer’s obligations
under Section 3.1 (a) (iii) of this Agreement.
Section 3.5. Real Property Taxes. The Developer shall, so long as this Agreement
remains in effect, pay all real property taxes with respect to all parts of the Property owned by it
which are payable pursuant to any statutory or contractual duty that shall accrue until title to the
Property is vested in another person. The Developer agrees that for tax assessments so long as
this Agreement remains in effect:
(a) It will not seek administrative review or judicial review of the applicability of any
tax statute relating to the ad valorem property taxation of real property contained on the Property
determined by any tax official to be applicable to the Project or the Developer or raise the
inapplicability of any such tax statute as a defense in any proceedings with respect to the
Property, including delinquent tax proceedings; provided, however, "tax statute" does not include
any local ordinance or resolution levying a tax;
(b) It will not seek administrative review or judicial review of the constitutionality of
any tax statute relating to the taxation of real property contained on the Property determined by
any tax official to be applicable to the Project or the Developer or raise the unconstitutionality of
any such tax statute as a defense in any proceedings, including delinquent tax proceedings with
respect to the Property; provided, however, "tax statute" does not include any local ordinance or
resolution levying a tax;
(c) It will not seek any tax deferral or abatement, either presently or prospectively
authorized under Minnesota Statutes, Section 469.181, or any other State or federal law, of the
ad valorem property taxation of the Tax Abatement Property so long as this Agreement remains
in effect.
ARTICLE IV.
EVENTS OF DEFAULT
Section 4.1. Events of Default Defined. The following shall be "Events of Default"
under this Agreement and the term "Event of Default" shall mean, whenever it is used in this
Agreement (unless the context otherwise provides), any one or more of the following events:
(a) Subject to Unavoidable Delays and the passing of any applicable cure rights
failure by the Developer to pay when due any payments required to be paid under this
Agreement or to pay when due ad valorem taxes on the Property.
(b) Subject to Unavoidable Delays and the passing of any applicable cure rights
failure by the Developer to acquire the Property and commence, diligently pursue and complete
Page 40 of 352
Resolution 2024-59
Page 2 of 2
construction of the Project, or portions thereof, pursuant to the terms, conditions and limitations
of this Agreement.
(c) Failure by Developer to observe or perform any other covenant, condition,
obligation or agreement on its part to be observed or performed hereunder.
(d) If any warranty or representation by the Developer in this Agreement is untrue in
any material respect.
Section 4.2. City’s Remedies on Default. Whenever any Event of Default by
Developer referred to in Section 5.1 of this Agreement occurs, the City may take any one or
more of the following actions and unless otherwise provided such actions may be taken only
after providing thirty (30) days written notice to the Developer of the Event of Default and the
Event of Default has not been cured within said thirty (30) days or, if the Event of Default is by
its nature incurable within thirty (30) days, the Developer does not provide assurances to the City
reasonably satisfactory to the City that the Event of Default will be cured and will be cured as
soon as reasonably possible:
(a) Suspend its performance under the Agreement until it receives assurances from
the Developer, deemed adequate by the City, that the Developer will cure its default and
continue its performance under the Agreement.
(b) Terminate this Agreement; except for an Event of Default pursuant to Section 3.1
(a) (iii).
(c) Take whatever action, including legal, equitable or administrative action, which
may appear necessary or desirable to the City to collect any payments due or damages arising
under this Agreement or to enforce performance and observance of any obligation, agreement, or
covenant of the Developer under this Agreement.
Section 4.3. No Remedy Exclusive. No remedy herein conferred upon or reserved to
the City is intended to be exclusive of any other available remedy or remedies, but each and
every such remedy shall be cumulative and shall be in addition to every other remedy given
under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or
omission to exercise any right or power accruing upon any default shall impair any such right or
power or shall be construed to be a waiver thereof, but any such right and power may be
exercised from time to time and as often as may be deemed expedient.
Section 4.4. No Implied Waiver. In the event any agreement contained in this
Agreement should be breached by any part and thereafter waived by any other party, such waiver
shall be limited to the particular breach so waived and shall not be deemed to waive any other
concurrent, previous or subsequent breach hereunder.
Section 4.5. Attorneys' Fees. Whenever any Event of Default occurs and either the City
shall employ attorneys or incur expenses for the collection of payments due or to become due or
for the enforcement of performance or observance of any obligation or agreement on the part of
Page 41 of 352
Resolution 2024-59
Page 2 of 2
the Developer under this Agreement, the Developer agrees that it shall, within ten (10) days of
written demand by the City pay to the City the reasonable fees of such attorneys paid by the City
and such other expenses so incurred and paid for by the City, provided, that the Developer shall
only be obligated to make such reimbursement if the other party prevails in such collection or
enforcement action.
ARTICLE V.
ADDITIONAL PROVISIONS
Section 5.1. Equal Employment Opportunity. The Developer, for itself and its
successors and assigns, agrees that during the construction of the Project provided for in this
Agreement it will comply with all applicable federal, state and local equal employment and
nondiscrimination laws and regulations.
Section 5.2. Waiver and Release by Developer. The Developer hereby waives,
releases and forever discharges the City from any claim for costs incurred in preliminary plans,
specifications, site testing improvements, professional fees or legal fees in connection with the
Project.
Section 5.3. Release and Indemnifications Covenants.
(a) The Developer releases from and covenants and agrees that the City and their
governing body members, officers, agents, servants and employees shall not be liable for and
agrees to indemnify and hold harmless the City and its governing body members, officers,
agents, servants, and employees against any loss or damage to property or any injury to or death
of any person occurring at or about or resulting from any defect in the Project or Property.
(b) Except for any willful misrepresentation or wanton misconduct of the following
named parties, the Developer agrees to protect and defend the City and its governing body
members, officers, agents, servants and employees, now or forever and further agrees to hold the
aforesaid harmless from any claim, demand, such , action or other proceeding whatsoever by any
person or entity whatsoever arising or purportedly arising from a breach of the obligations of the
Developer under this Agreement, or the transactions contemplated hereby or the acquisition,
construction, installation, ownership, maintenance and operation of the Project and Property.
(c) The City and its governing body members, officers, agents, servants and
employees shall not be liable for any damages or injury to the persons or property of the
Developer or its officers, agents, servants, employees, invitees, guests or any other person who
may be on the Property or may use the Project or Property due to any act of negligence of any
person.
(d) All covenants, stipulations, promises, agreements and obligations of the City
contained herein shall be deemed to be the covenants, stipulations, promises, agreements and
obligations of the City and not of any governing body member, officer, agent, servant or
employee of the City in the individual capacity thereof.
Page 42 of 352
Resolution 2024-59
Page 2 of 2
Section 5.4. Titles of Articles and Sections. Any titles of the several parts, Articles and
Sections of this Agreement are inserted for convenience of reference only and shall be
disregarded in construing or interpreting any of its provisions.
Section 5.5. Notices and Demands. Except as otherwise expressly provided in this
Agreement, a notice, demand or other communication under the Agreement by either party to the
other shall be sufficiently given or delivered if it is dispatched by registered or certified mail,
postage prepaid, return receipt requested or delivered personally; and
(a) In the case of the Developer, is addressed or delivered personally to:
Apartments Farmington, LLC
Attn: Vishal Dutt
1834 East 38th Street
Minneapolis, MN 55407
With a Copy to:
Siegel Brill, P.A.
Attn: Anthony J. Gleekel, Esq.
100 Washington Ave. S., Suite 1300
Minneapolis, MN 55401
(b) In the case of the City, is addressed or delivered personally to:
City Administrator
City of Farmington
430 3rd St.,
Farmington, MN 55024
With a copy to:
Leah Koch
Campbell Knutson, Professional Association
860 Blue Gentian Road, Suite 290
Eagan, MN 55121
Telephone: (651) 452-5000
(c) Either Party may, upon written notice to the other Party, change the address to
which such notices and demands are made.
Section 5.6. Disclaimer of Relationship. The Developer acknowledges that nothing
contained in this Agreement nor any act by the City or the Developer shall be deemed or
construed by the Developer or any third person to create any relationship of third-party
beneficiary, principal and agent, limited or general partner or joint venture between the City and
the Developer.
Page 43 of 352
Resolution 2024-59
Page 2 of 2
Section 5.7. Covenants Running with the Land. The terms and provisions of this
Agreement shall be deemed to be covenants running with the Property and shall be binding upon
any successors or assigns of the Developer and any future owners or encumbrances of the
Property.
Section 5.8. Counterparts. This Agreement is executed in any number of counterparts,
each of which shall constitute one and the same instrument.
Section 5.9. Law Governing. This Agreement will be governed and construed in
accordance with the laws of Minnesota.
Section 5.10. Facsimile Signature. The parties hereto acknowledge and agree that in
order to expedite the signing of this Agreement and the processing, and review and compliance
with the terms hereof, the parties may utilize facsimile equipment to transmit and convey
signatures hereto and such other information as may be necessary. With respect to any such
transmission bearing a signature for any party hereto and on which the receiver is or may be
reasonably expected to rely, than if such a facsimile transmission is corroborated by regular
facsimile printout showing the telephone number from which transmitted together with a date
and time of transmission, it shall be binding on the sending party and may be relied upon by the
party receiving the same. The sending party hereby acknowledges such reliance and weighs any
defenses to the use of such documents or signatures. Additionally, electronic signatures using a
certified e-signature via Adobe or DocuSign are acceptable for this Agreement and related
documents will be accepted with the same effect as original ink-signed “hard copy” versions of
such documents. Notwithstanding the foregoing, all documents which are to be recorded must be
delivered by the signing party as fully executed and acknowledged (and, if required by
applicable law, witnessed) “wet ink” originals.
Section 5.11. Estoppel Certificate. Each party, respectively, agrees that at any time and
from time to time within ten (10) business days after receipt of a written request by the other
party, to execute, acknowledge and deliver to such party a statement in writing and in such form
as will enable it to be recorded in the proper office for the recordation of deeds and other
instruments certifying: (a) that this Agreement is unmodified and in full force and effect or, if
there have been modifications, that the same are in full force and effect as modified and
identifying the modifications; (b) that no party is in default under any provisions of this
Agreement or, if there has been a default, the nature of such default; (c) that all work to be
performed, under this Agreement or any related agreement has been performed or, if not so
performed, specifying the work to be performed; and (d) as to any other matter that the
requesting party, a prospective purchaser or assignee or a prospective mortgagee or other lender
shall reasonably request. It is intended that any such statement may be relied upon by any person,
prospective mortgagee of, or assignee of any mortgage, upon such interest. Any such statement
on behalf of the City may be executed by the City Administrator without City Council approval.
Section 5.12. Expiration. This Agreement shall expire on the date that the City’s Tax
Abatement is paid in full, unless otherwise terminated pursuant to Section 4.2.
Page 44 of 352
Resolution 2024-59
Page 2 of 2
IN WITNESS WHEREOF, the City has caused this Agreement to be duly executed in
its name and on its behalf, the Developer has caused this Agreement to be duly executed in its
name and behalf, on or as of the date first above written.
[Remainder of Page Intentionally Left Blank]
[Signature pages to follow]
Page 45 of 352
Resolution 2024-59
Page 2 of 2
CITY OF FARMINGTON
By: ___________________________
Joshua Hoyt, Mayor
By: ___________________________
Shirley Buecksler, City Clerk
STATE OF MINNESOTA )
)ss.
COUNTY OF DAKOTA )
The foregoing instrument was acknowledged before me this _______ day of
__________________, 2024, by Joshua Hoyt, the Mayor of the City of Farmington, a
Minnesota municipal corporation, on behalf of the corporation and pursuant to the authority
granted by its City Council.
____________________________________
Notary Public
STATE OF MINNESOTA )
)ss.
COUNTY OF DAKOTA )
The foregoing instrument was acknowledged before me this _______ day of
__________________, 2024, by Shirley Buecksler, the City Clerk of the City of Farmington, a
Minnesota municipal corporation, on behalf of the corporation and pursuant to the authority
granted by its City Council.
____________________________________
Notary Public
Page 46 of 352
Resolution 2024-59
Page 2 of 2
APARTMENTS FARMINGTON, LLC
By:
___________________ [Print Name]
Its ______________________ [Title]
STATE OF MINNESOTA )
)ss.
COUNTY OF __________ )
The foregoing instrument was acknowledged before me this _____ day of __________,
2024, by _________________________, the ___________________________ of Apartments
Farmington, LLC, a Minnesota limited liability company, on behalf of said entity.
__________________________
Notary Public
DRAFTED BY:
CAMPBELL KNUTSON,
Professional Association
Grand Oak Office Center I
860 Blue Gentian Road, Suite 290
Eagan, Minnesota 55121
Telephone: (651) 452-5000
LCMK/mkl
Page 47 of 352
Resolution 2024-59
Page 2 of 2
EXHIBIT A
Legal Description of Property
Lot 2, Block 1, Vermillion River Crossings 3rd Addition, Dakota County, Minnesota
Page 48 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Kim Sommerland, Finance Director
Department: Finance
Subject: Payment of Claims
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
Attached is the list of check and electronic payments for the period of 06/13/2024-06/25/2024 for
approval.
DISCUSSION:
Not applicable
BUDGET IMPACT:
Not applicable
ACTION REQUESTED:
Approve payment of claims.
ATTACHMENTS:
Council Summary Payment of Claims 07-01-2024
Page 49 of 352
CLAIMS FOR APPROVAL 06/13/2024 ‐ 06/25/2024:
CHECK PAYMENTS 546,647.79$
ELECTRONIC PAYMENTS 401,374.87$
TOTAL 948,022.66$
The City Council receives a detail list of claims paid that is available to
the public upon request.
CITY OF FARMINGTON
SUMMARY PAYMENT OF CLAIMS
July 1, 2024
Page 50 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Matt Price, Interim Fire Chief
Department: Fire
Subject: Fire Service Agreement with Eureka Township
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
Attached for review is the proposed Fire Service Agreement with Eureka Township and the Fire
Department to provide fire and emergency services for 2024-2028.
DISCUSSION:
The City of Farmington has provided fire and emergency services to portions of Eureka Township.
Staff has worked with Eureka Township to update the fire service contract. With the rising cost of
the service we provide, it was important for this contract to reflect the actual costs.
BUDGET IMPACT:
The service charges are included in the 2024 budget.
ACTION REQUESTED:
The action requested is to approve the attached Fire Service Agreement with Eureka Township.
ATTACHMENTS:
Eureka Township Fire Service Agreement
Page 51 of 352
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Pa
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Page 52 of 352
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
re
s
p
o
n
d
to
al
l
su
c
h
em
e
r
g
e
n
c
i
e
s
in
Eu
r
e
k
a
wi
t
h
th
e
mi
n
i
m
u
m
ap
p
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p
r
i
a
t
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pe
r
s
o
n
n
e
l
an
d
ap
p
a
r
a
t
u
s
as
de
t
e
r
m
i
n
e
d
by
th
e
de
c
i
s
i
o
n
of
Fa
r
m
i
n
g
t
o
n
’
s
Fi
r
e
Ch
i
e
f
or
ot
h
e
r
ra
n
k
i
n
g
of
?
c
e
r
or
of
?
c
i
a
l
in
ch
a
r
g
e
of
th
e
?r
e
de
p
a
r
t
m
e
n
t
at
th
e
ti
m
e
.
Th
e
pa
r
t
i
e
s
un
d
e
r
s
t
a
n
d
th
e
?r
e
de
p
a
r
t
m
e
n
t
of
?
c
e
r
in
ch
a
r
g
e
of
th
e
pa
r
t
i
c
u
l
a
r
sc
e
n
e
sh
a
l
l
ex
e
r
c
i
s
e
ju
d
g
m
e
n
t
to
de
t
e
r
m
i
n
e
,
in
co
n
s
i
d
e
r
a
t
i
o
n
of
al
l
th
e
es
t
a
b
l
i
s
h
e
d
po
l
i
c
i
e
s
,
gu
i
d
e
l
i
n
e
s
,
pr
o
c
e
d
u
r
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s
,
an
d
pr
a
c
t
i
c
e
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,
ho
w
be
s
t
to
al
l
o
c
a
t
e
th
e
av
a
i
l
a
b
l
e
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s
o
u
r
c
e
s
of
th
e
?r
e
de
p
a
r
t
m
e
n
t
un
d
e
r
th
e
ci
r
c
u
m
s
t
a
n
c
e
s
of
a
gi
v
e
n
si
t
u
a
t
i
o
n
.
Fa
i
l
u
r
e
to
pr
o
v
i
d
e
se
r
v
i
c
e
s
be
c
a
u
s
e
of
po
o
r
we
a
t
h
e
r
co
n
d
i
t
i
o
n
s
or
ot
h
e
r
co
n
d
i
t
i
o
n
s
be
y
o
n
d
th
e
co
n
t
r
o
l
of
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
no
t
be
de
e
m
e
d
a
br
e
a
c
h
of
th
i
s
co
n
t
r
a
c
t
.
Th
e
pa
r
t
i
e
s
un
d
e
r
s
t
a
n
d
an
d
ag
r
e
e
th
a
t
Fa
r
m
i
n
g
t
o
n
wi
l
l
en
d
e
a
v
o
r
to
re
a
s
o
n
a
b
l
y
pr
o
v
i
d
e
th
e
se
r
v
i
c
e
s
in
d
i
c
a
t
e
d
ab
o
v
e
gi
v
e
n
th
e
ci
r
c
u
m
s
t
a
n
c
e
s
,
bu
t
Fa
r
m
i
n
g
t
o
n
ma
k
e
s
no
gu
a
r
a
n
t
e
e
s
th
a
t
th
e
se
r
v
i
c
e
s
it
ac
t
u
a
l
l
y
pr
o
v
i
d
e
s
in
a
gi
v
e
n
si
t
u
a
t
i
o
n
wi
l
l
me
e
t
an
y
pa
r
t
i
c
u
l
a
r
cr
i
t
e
r
i
a
or
st
a
n
d
a
r
d
.
F
ar
m
i
n
g
t
o
n
an
d
it
s
of
?
c
e
r
s
,
em
p
l
o
y
e
e
s
an
d
vo
l
u
n
t
e
e
r
s
sh
a
l
l
no
t
be
li
a
b
l
e
to
Eu
r
e
k
a
or
an
y
ot
h
e
r
pe
r
s
o
n
fo
r
fa
i
l
u
r
e
to
fu
r
n
i
s
h
as
s
i
s
t
a
n
c
e
un
d
e
r
th
i
s
ag
r
e
e
m
e
n
t
or
fo
r
re
c
a
l
l
i
n
g
as
s
i
s
t
a
n
c
e
.
3.
CO
M
P
E
N
S
A
T
I
O
N
.
A.
Eu
r
e
k
a
ag
r
e
e
s
to
pa
y
F
ar
m
i
n
g
t
o
n
an
n
u
a
l
l
y
du
r
i
n
g
th
e
te
r
m
of
th
i
s
co
n
t
r
a
c
t
th
e
Pa
y
m
e
n
t
Am
o
u
n
t
de
t
e
r
m
i
n
e
d
an
n
u
a
l
l
y
ac
c
o
r
d
i
n
g
to
th
e
fo
l
l
o
w
i
n
g
fo
r
m
u
l
a
.
Th
e
fo
l
l
o
w
i
n
g
pe
r
c
e
n
t
a
g
e
s
re
l
a
t
e
sp
e
c
i
?
c
a
l
l
y
to
Eu
r
e
k
a
in
re
l
a
t
i
o
n
to
th
e
re
s
p
o
n
s
e
ar
e
a
de
p
i
c
t
e
d
in
Ex
h
i
b
i
t
A
to
wh
i
c
h
Fa
r
m
i
n
g
t
o
n
pr
o
v
i
d
e
s
?r
e
se
r
v
i
c
e
s
as
th
e
pr
i
m
a
r
y
se
r
v
i
c
e
pr
o
v
i
d
e
r
.
Nu
m
b
e
r
of
?r
e
se
r
v
i
c
e
ca
l
l
s
to
Eu
r
e
k
a
av
e
r
a
g
e
d
ov
e
r
th
e
pr
e
c
e
d
i
n
g
th
r
e
e
ca
l
e
n
d
a
r
ye
a
r
s
(n
o
t
in
c
l
u
d
i
n
g
re
c
a
l
l
e
d
ca
l
l
s
)
as
a
pr
o
p
o
r
t
i
o
n
of
al
l
se
r
v
i
c
e
ca
l
l
s
re
s
p
o
n
d
e
d
to
by
th
e
F
ar
m
i
n
g
t
o
n
Fi
r
e
De
p
a
r
t
m
e
n
t
in
th
a
t
ti
m
e
pe
r
i
o
d
:
00
st
r
u
c
t
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r
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s
Eu
r
e
k
a
de
p
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c
t
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in
Ex
h
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b
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t
A
(a
s
mo
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d
by
th
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as
s
e
s
s
o
r
)
as
a
pr
o
p
o
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t
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of
th
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ma
r
k
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t
va
l
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of
al
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ta
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a
b
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an
d
no
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t
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x
a
b
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u
c
t
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s
in
th
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ar
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a
se
r
v
e
d
by
th
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23
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v
7
Pa
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m
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Page 53 of 352
To
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De
p
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Am
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B.
23
0
4
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2
v
7
Fo
r
th
e
pu
r
p
o
s
e
s
of
th
i
s
fo
r
m
u
l
a
,
po
p
u
l
a
t
i
o
n
sh
a
l
l
be
de
t
e
r
m
i
n
e
d
by
th
e
mo
s
t
cu
r
r
e
n
t
st
a
t
e
de
m
o
g
r
a
p
h
e
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’
s
es
t
i
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t
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av
a
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a
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m
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Pa
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m
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Am
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Op
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in
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i
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ba
s
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d
on
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m
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n
g
t
o
n
’
s
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e
d
as
s
e
t
po
l
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c
y
,
sh
a
l
l
ex
c
l
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ca
p
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t
a
l
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l
a
y
pu
r
c
h
a
s
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s
an
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st
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e
ai
d
re
c
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i
v
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d
by
Fa
r
m
i
n
g
t
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n
.
A
st
a
t
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m
e
n
t
fo
r
se
r
v
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c
e
s
sh
a
l
l
be
pr
o
v
i
d
e
d
to
Eu
r
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k
a
on
a
qu
a
r
t
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r
l
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ba
s
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an
d
fo
r
w
a
r
d
e
d
to
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k
a
fo
r
pa
y
m
e
n
t
.
Eu
r
e
k
a
sh
a
l
l
pa
y
fo
r
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se
r
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c
e
s
wi
t
h
i
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th
i
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t
y
-
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(3
5
)
da
y
s
af
t
e
r
bi
l
l
i
n
g
by
Fa
r
m
i
n
g
t
o
n
.
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i
n
g
t
o
n
ma
y
im
p
o
s
e
ch
a
r
g
e
s
fo
r
it
s
se
r
v
i
c
e
s
un
d
e
r
th
i
s
Ag
r
e
e
m
e
n
t
to
Eu
r
e
k
a
re
s
i
d
e
n
t
s
,
pr
o
p
e
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t
y
ow
n
e
r
s
,
an
d
ot
h
e
r
pe
r
s
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n
s
to
th
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m
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ex
t
e
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t
as
th
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s
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,
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t
y
ow
n
e
r
s
,
an
d
ot
h
e
r
pe
r
s
o
n
s
.
Eu
r
e
k
a
To
w
n
Bo
a
r
d
sh
a
l
l
as
s
i
s
t
in
th
e
co
l
l
e
c
t
i
o
n
of
an
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ch
a
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ce
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t
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f
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th
e
ch
a
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s
ag
a
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s
t
Eu
r
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k
a
pr
o
p
e
r
t
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e
s
or
by
ot
h
e
r
la
w
f
u
l
me
a
n
s
of
co
l
l
e
c
t
i
o
n
.
It
is
un
d
e
r
s
t
o
o
d
an
d
ag
r
e
e
d
Eu
r
e
k
a
sh
a
l
l
ha
v
e
no
re
s
p
o
n
s
i
b
i
l
i
t
y
wh
a
t
s
o
e
v
e
r
to
w
a
r
d
th
e
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e
?
g
h
t
e
r
s
or
ot
h
e
r
em
e
r
g
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n
c
y
pe
r
s
o
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l
in
c
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an
y
em
p
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m
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n
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re
l
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t
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d
is
s
u
e
s
su
c
h
as
tr
a
i
n
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n
g
,
su
p
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r
v
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o
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,
pe
r
f
o
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m
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w
s
,
di
s
c
i
p
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co
m
p
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s
a
t
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o
n
,
be
n
e
?
t
s
,
in
s
u
r
a
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co
v
e
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co
m
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t
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y
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p
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y
m
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t
re
l
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d
fe
d
e
r
a
l
,
st
a
t
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,
an
d
lo
c
a
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la
w
s
an
d
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l
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s
su
c
h
as
OS
H
A
,
ER
I
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,
RL
S
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L
A
,
or
an
y
ot
h
e
r
em
p
l
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y
m
e
n
t
re
l
a
t
e
d
is
s
u
e
s
.
It
is
fu
r
t
h
e
r
ag
r
e
e
d
Eu
r
e
k
a
ha
s
no
re
s
p
o
n
s
i
b
i
l
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t
y
,
be
y
o
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pa
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th
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d
up
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Pa
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m
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Am
o
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,
fo
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q
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,
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ma
i
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t
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,
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u
s
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n
g
,
or
re
p
l
a
c
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g
eq
u
i
p
m
e
n
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as
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e
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e
d
to
pr
o
v
i
d
e
th
e
?r
e
se
r
v
i
c
e
s
de
s
c
r
i
b
e
d
he
r
e
i
n
.
EN
F
O
R
C
E
M
E
N
T
OF
MI
N
N
E
S
O
T
A
ST
A
T
E
FI
R
E
CO
D
E
.
Th
e
Fa
r
m
i
n
g
t
o
n
Fi
r
e
Ch
i
e
f
,
on
be
h
a
l
f
of
Fa
r
m
i
n
g
t
o
n
,
is
he
r
e
b
y
au
t
h
o
r
i
z
e
d
to
ar
e
a
s
an
y
Pa
g
e
3
Fa
r
m
i
n
g
t
o
n
Fi
r
e
D e p ar
t m e nt
:
00
Ha
l
f
of
th
e
po
p
u
l
a
t
io
n
of
al
l
ofEu
r
e
k
a
asapr
o
p
o
r
t
i
o
n
of
th
e
to
t
a
l
po
p
u
l
a
t
i
o
n
th
e
ar
e
a
s
se
r
v
e
d
by
th
e
Fa
r
m
i
n
g
t
o
n
De
p
ar
t
m
en
t
:
”a To
t
a
l
:
00
I3
0 0
Eu
re
k
aCo
s
t
Page 54 of 352
me
c
h
a
n
i
s
m
s
in
c
l
u
d
i
n
g
bu
t
no
t
li
m
i
t
e
d
to
in
j
u
n
c
t
i
v
e
re
l
i
e
f
o
r
an
y
ap
p
l
i
c
a
b
l
e
cr
i
m
i
n
a
l
pr
o
s
e
c
u
t
i
o
n
.
B.
Th
e
co
s
t
s
to
Fa
r
m
i
n
g
t
o
n
fo
r
an
y
in
c
i
d
e
n
t
re
s
u
l
t
i
n
g
fr
o
m
an
ac
t
of
ne
g
l
i
g
e
n
c
e
or
ca
r
e
l
e
s
s
n
e
s
s
th
a
t
re
q
u
i
r
e
s
em
e
r
g
e
n
c
y
re
s
p
o
n
s
e
se
r
v
i
c
e
s
ma
y
be
bi
l
l
e
d
to
th
e
pa
r
t
y
re
s
p
o
n
s
i
b
l
e
fo
r
su
c
h
ne
g
l
i
g
e
n
c
e
or
ca
r
e
l
e
s
s
n
e
s
s
.
Ex
a
m
p
l
e
s
of
ne
g
l
i
g
e
n
c
e
or
ca
r
e
l
e
s
s
n
e
s
s
in
c
l
u
d
e
,
bu
t
ar
e
no
t
li
m
i
t
e
d
to
,
fa
l
s
e
al
a
r
m
re
s
p
o
n
s
e
s
;
br
u
s
h
bu
r
n
i
n
g
,
de
b
r
i
s
bu
r
n
i
n
g
,
or
re
c
r
e
a
t
i
o
n
a
l
ca
m
p
f
i
r
e
s
th
a
t
re
q
u
i
r
e
an
em
e
r
g
e
n
c
y
re
s
p
o
n
s
e
se
r
v
i
c
e
;
me
t
h
a
m
p
h
e
t
a
m
i
n
e
la
b
ex
p
l
o
s
i
o
n
s
;
an
d
ot
h
e
r
ex
p
l
o
s
i
o
n
s
or
?r
e
s
re
s
u
l
t
i
n
g
fr
o
m
ne
g
l
i
g
e
n
c
e
or
ca
r
e
l
e
s
s
n
e
s
s
.
C.
Th
e
co
s
t
s
to
Fa
r
m
i
n
g
t
o
n
fo
r
an
y
ha
z
a
r
d
o
u
s
ma
t
e
r
i
a
l
sp
i
l
l
s
or
re
l
e
a
s
e
s
re
q
u
i
r
i
n
g
em
e
r
g
e
n
c
y
re
s
p
o
n
s
e
se
r
v
i
c
e
s
ma
y
be
bi
l
l
e
d
to
th
e
pa
r
t
y
re
s
p
o
n
s
i
b
l
e
fo
r
su
c
h
ha
z
a
r
d
o
u
s
ma
t
e
r
i
a
l
sp
i
l
l
s
or
re
l
e
a
s
e
s
.
D.
Th
e
co
s
t
s
to
Fa
r
m
i
n
g
t
o
n
fo
r
em
e
r
g
e
n
c
y
re
s
p
o
n
s
e
se
r
v
i
c
e
s
re
s
u
l
t
i
n
g
fr
o
m
an
ac
t
of
ar
s
o
n
ma
y
be
su
b
m
i
t
t
e
d
to
lo
c
a
l
co
u
r
t
fo
r
re
s
t
i
t
u
t
i
o
n
fr
o
m
th
e
pa
r
t
y
co
n
v
i
c
t
e
d
of
ar
s
o
n
un
d
e
r
Mi
n
n
e
s
o
t
a
la
w
.
E.
An
y
ou
t
s
t
a
n
d
i
n
g
in
v
o
i
c
e
s
to
Fa
r
m
i
n
g
t
o
n
ma
y
be
ce
r
t
i
?
e
d
to
th
e
pr
o
p
e
r
t
y
ta
x
e
s
of
th
e
in
c
i
d
e
n
t
si
t
e
by
Fa
r
m
i
n
g
t
o
n
.
5.
IN
D
E
M
N
I
F
I
C
A
T
I
O
N
.
Fa
r
m
i
n
g
t
o
n
ag
r
e
e
s
to
de
f
e
n
d
an
d
in
d
e
m
n
i
f
y
Eu
r
e
k
a
ag
a
i
n
s
t
an
y
cl
a
i
m
s
br
o
u
g
h
t
or
ac
t
i
o
n
s
fi
l
e
d
ag
a
i
n
s
t
Eu
r
e
k
a
or
an
y
of
f
i
c
e
r
,
em
p
l
o
y
e
e
,
or
vo
l
u
n
t
e
e
r
of
Eu
r
e
k
a
fo
r
in
j
u
r
y
to
,
de
a
t
h
of
,
or
da
m
a
g
e
to
th
e
pr
o
p
e
r
t
y
of
an
y
th
i
r
d
pe
r
s
o
n
or
pe
r
s
o
n
s
,
ar
i
s
i
n
g
fr
o
m
F
ar
m
i
n
g
t
o
n
’
s
pe
r
f
o
r
m
a
n
c
e
un
d
e
r
th
i
s
co
n
t
r
a
c
t
fo
r
se
r
v
i
c
e
s
.
Un
d
e
r
no
ci
r
c
u
m
s
t
a
n
c
e
s
,
ho
w
e
v
e
r
,
sh
a
l
l
Fa
r
m
i
n
g
t
o
n
be
re
q
u
i
r
e
d
to
pa
y
on
be
h
a
l
f
of
it
s
e
l
f
an
d
Eu
r
e
k
a
,
an
y
am
o
u
n
t
s
in
ex
c
e
s
s
of
th
e
li
m
i
t
s
on
li
a
b
i
l
i
t
y
es
t
a
b
l
i
s
h
e
d
in
Mi
n
n
e
s
o
t
a
St
a
t
u
t
e
s
,
Ch
a
p
t
e
r
46
6
ap
p
l
i
c
a
b
l
e
to
an
y
on
e
pa
r
t
y
.
Th
e
li
m
i
t
s
of
li
a
b
i
l
i
t
y
fo
r
Eu
r
e
k
a
an
d
Fa
r
m
i
n
g
t
o
n
ma
y
no
t
be
ad
d
e
d
to
g
e
t
h
e
r
to
de
t
e
r
m
i
n
e
th
e
ma
x
i
m
u
m
am
o
u
n
t
of
li
a
b
i
l
i
t
y
fo
r
Fa
r
m
i
n
g
t
o
n
.
Th
e
in
t
e
n
t
of
th
i
s
su
b
d
i
v
i
s
i
o
n
is
to
im
p
o
s
e
on
Fa
r
m
i
n
g
t
o
n
a
li
m
i
t
e
d
du
t
y
to
de
f
e
n
d
an
d
in
d
e
m
n
i
f
y
Eu
r
e
k
a
fo
r
cl
a
i
m
s
ar
i
s
i
n
g
ou
t
of
th
e
pe
r
f
o
r
m
a
n
c
e
of
th
i
s
co
n
t
r
a
c
t
su
b
j
e
c
t
to
th
e
li
m
i
t
s
of
li
a
b
i
l
i
t
y
un
d
e
r
Mi
n
n
e
s
o
t
a
St
a
t
u
t
e
s
,
Ch
a
p
t
e
r
46
6
.
Th
e
pu
r
p
o
s
e
of
cr
e
a
t
i
n
g
th
i
s
du
t
y
to
de
f
e
n
d
an
d
in
d
e
m
n
i
f
y
is
to
si
m
p
l
i
f
y
th
e
de
f
e
n
s
e
of
c
l
a
i
m
s
by
el
i
m
i
n
a
t
i
n
g
co
n
f
l
i
c
t
s
be
t
w
e
e
n
th
e
pa
r
t
i
e
s
an
d
to
pe
r
m
i
t
li
a
b
i
l
i
t
y
cl
a
i
m
s
ag
a
i
n
s
t
bo
t
h
pa
r
t
i
e
s
fr
o
m
6.
IN
S
U
R
A
N
C
E
.
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
ma
i
n
t
a
i
n
ge
n
e
r
a
l
li
a
b
i
l
i
t
y
in
s
u
r
a
n
c
e
fo
r
it
s
se
r
v
i
c
e
s
an
d
sh
a
l
l
in
c
l
u
d
e
Eu
r
e
k
a
as
an
ad
d
i
t
i
o
n
a
l
in
s
u
r
e
d
fo
r
th
e
te
r
m
of
th
i
s
Ag
r
e
e
m
e
n
t
an
d
an
y
ex
t
e
n
s
i
o
n
s
th
e
r
e
o
f
.
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
ma
i
n
t
a
i
n
in
s
u
r
a
n
c
e
eq
u
a
l
to
or
gr
e
a
t
e
r
th
a
n
th
e
ma
x
i
m
u
m
li
a
b
i
l
i
t
y
ap
p
l
i
c
a
b
l
e
to
mu
n
i
c
i
p
a
l
i
t
i
e
s
as
se
t
fo
r
t
h
in
Mi
n
n
e
s
o
t
a
St
a
t
u
t
e
s
,
Se
c
t
i
o
n
46
6
.
0
4
,
su
b
d
.
1,
as
am
e
n
d
e
d
.
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
pr
o
v
i
d
e
Eu
r
e
k
a
pr
o
o
f
of
su
c
h
in
s
u
r
a
n
c
e
co
v
e
r
a
g
e
s
an
d
th
e
ad
d
i
t
i
o
n
a
l
in
s
u
r
e
d
en
d
o
r
s
e
m
e
n
t
na
m
i
n
g
Eu
r
e
k
a
an
n
u
a
l
l
y
by
th
e
an
n
i
v
e
r
s
a
r
y
da
t
e
of
th
i
s
Ag
r
e
e
m
e
n
t
.
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
al
s
o
ma
i
n
t
a
i
n
wo
r
k
e
r
s
’
co
m
p
e
n
s
a
t
i
o
n
co
v
e
r
a
g
e
as
re
q
u
i
r
e
d
by
la
w
.
7.
MI
N
N
E
S
O
T
A
GO
V
E
R
N
M
E
N
T
DA
T
A
PR
A
C
T
I
C
E
S
AC
T
.
Al
l
da
t
a
co
l
l
e
c
t
e
d
cr
e
a
t
e
d
,
re
c
e
i
v
e
d
,
ma
i
n
t
a
i
n
e
d
,
or
di
s
s
e
m
i
n
a
t
e
d
,
in
an
y
fo
r
m
,
fo
r
an
y
pu
r
p
o
s
e
s
be
c
a
u
s
e
of
th
i
s
23
0
4
0
2
v
7
Pa
g
e
4
Page 55 of 352
Ag
r
e
e
m
e
n
t
is
go
v
e
r
n
e
d
by
th
e
Mi
n
n
e
s
o
t
a
Go
v
e
r
n
m
e
n
t
Da
t
a
Pr
a
c
t
i
c
e
s
Ac
t
(M
i
n
n
e
s
o
t
a
St
a
t
u
t
e
s
,
Ch
a
p
t
e
r
13
an
d
re
l
a
t
e
d
st
a
t
u
t
e
s
)
,
as
am
e
n
d
e
d
,
th
e
Mi
n
n
e
s
o
t
a
Ru
l
e
s
im
p
l
e
m
e
n
t
i
n
g
su
c
h
Ac
t
,
as
am
e
n
d
e
d
,
as
we
l
l
as
Fe
d
e
r
a
l
Re
g
u
l
a
t
i
o
n
s
on
da
t
a
pr
i
v
a
c
y
.
Th
e
pe
r
s
o
n
re
s
p
o
n
s
i
b
l
e
fo
r
re
l
e
a
s
e
of
al
l
da
t
a
un
d
e
r
th
i
s
Ag
r
e
e
m
e
n
t
sh
a
l
l
be
id
e
n
t
i
?
e
d
by
ea
c
h
pa
r
t
y
.
8.
SU
B
C
O
N
T
R
A
C
T
I
N
G
AN
D
AS
S
I
G
N
M
E
N
T
.
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
no
t
su
b
c
o
n
t
r
a
c
t
or
as
s
i
g
n
an
y
po
r
t
i
o
n
of
th
i
s
Ag
r
e
e
m
e
n
t
to
an
o
t
h
e
r
wi
t
h
o
u
t
pr
i
o
r
wr
i
t
t
e
n
pe
r
m
i
s
s
i
o
n
fr
o
m
Eu
r
e
k
a
.
Se
r
v
i
c
e
s
pr
o
v
i
d
e
d
to
Eu
r
e
k
a
pu
r
s
u
a
n
t
to
a
mu
t
u
a
l
ai
d
ag
r
e
e
m
e
n
t
Fa
r
m
i
n
g
t
o
n
ha
s
,
or
ma
y
en
t
e
r
in
t
o
,
wi
t
h
an
o
t
h
e
r
en
t
i
t
y
do
e
s
no
t
co
n
s
t
i
t
u
t
e
a
su
b
c
o
n
t
r
a
c
t
or
as
s
i
g
n
m
e
n
t
re
q
u
i
r
i
n
g
pr
i
o
r
ap
p
r
o
v
a
l
of
Eu
r
e
k
a
so
lo
n
g
as
Fa
r
m
i
n
g
t
o
n
re
m
a
i
n
s
pr
i
m
a
r
i
l
y
re
s
p
o
n
s
i
b
l
e
fo
r
pr
o
v
i
d
i
n
g
?r
e
se
r
v
i
c
e
s
to
th
e
ar
e
a
of
Eu
r
e
k
a
pr
o
v
i
d
e
d
he
r
e
i
n
.
9.
TE
R
M
I
N
A
T
I
O
N
.
Th
i
s
Ag
r
e
e
m
e
n
t
ma
y
be
te
r
m
i
n
a
t
e
d
by
ei
t
h
e
r
Fa
r
m
i
n
g
t
o
n
or
Eu
r
e
k
a
by
gi
v
i
n
g
th
e
ot
h
e
r
pa
r
t
y
at
le
a
s
t
on
e
ye
a
r
’
s
pr
i
o
r
wr
i
t
t
e
n
no
t
i
c
e
of
su
c
h
ca
n
c
e
l
l
a
t
i
o
n
.
10
.
FA
R
M
I
N
G
T
O
N
’
S
RE
S
P
O
N
S
I
B
I
L
I
T
I
E
S
.
In
ad
d
i
t
i
o
n
to
an
y
ot
h
e
r
ob
l
i
g
a
t
i
o
n
s
de
s
c
r
i
b
e
d
he
r
e
i
n
,
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
:
A.
Au
t
h
o
r
i
z
e
an
d
di
r
e
c
t
th
e
Fa
r
m
i
n
g
t
i
o
n
?r
e
de
p
a
r
t
m
e
n
t
to
pr
o
v
i
d
e
th
e
?r
e
se
r
v
i
c
e
s
de
s
c
r
i
b
e
d
he
r
e
i
n
to
Eu
r
e
k
a
;
B.
De
v
e
l
o
p
a
de
t
a
i
l
e
d
an
n
u
a
l
op
e
r
a
t
i
o
n
a
l
bu
d
g
e
t
fo
r
th
e
?r
e
de
p
a
r
t
m
e
n
t
fo
r
ea
c
h
ye
a
r
du
r
i
n
g
th
e
te
r
m
of
th
i
s
co
n
t
r
a
c
t
by
th
e
An
n
i
v
e
r
s
a
r
y
Da
t
e
an
d
pr
e
s
e
n
t
it
to
Eu
r
e
k
a
al
o
n
g
wi
t
h
su
f
?
c
i
e
n
t
in
f
o
r
m
a
t
i
o
n
to
ex
p
l
a
i
n
th
e
it
e
m
s
in
c
l
u
d
e
d
in
th
e
bu
d
g
e
t
?g
u
r
e
s
;
C.
Up
o
n
Eu
r
e
k
a
’
s
re
q
u
e
s
t
,
pr
o
v
i
d
e
Eu
r
e
k
a
ac
c
e
s
s
to
?n
a
n
c
i
a
l
an
d
co
s
t
da
t
a
re
l
a
t
e
d
to
th
e
?r
e
de
p
a
r
t
m
e
n
t
fo
r
?v
e
ye
a
r
s
pr
i
o
r
to
th
e
cu
r
r
e
n
t
se
r
v
i
c
e
ye
a
r
;
D.
Di
s
c
l
o
s
e
to
Eu
r
e
k
a
an
y
pr
o
p
o
s
e
d
ac
t
i
o
n
th
e
Fa
r
m
i
n
g
t
o
n
or
th
e
?r
e
de
p
a
r
t
m
e
n
t
in
t
e
n
d
s
to
ta
k
e
th
a
t
ca
n
re
a
s
o
n
a
b
l
y
be
ex
p
e
c
t
e
d
to
af
f
e
c
t
th
e
In
s
u
r
a
n
c
e
Se
r
v
i
c
e
s
Of
?
c
e
Fi
r
e
Pr
o
t
e
c
t
i
o
n
Gr
a
d
e
in
Eu
r
e
k
a
or
Fa
r
m
i
n
g
t
o
n
’
s
ab
i
l
i
t
y
to
pr
o
v
i
d
e
th
e
?r
e
se
r
v
i
c
e
s
to
Eu
r
e
k
a
;
an
d
to
co
n
t
r
a
c
t
.
11
.
EU
R
E
K
A
’
S
RE
S
P
O
N
S
I
B
I
L
I
T
I
E
S
.
In
ad
d
i
t
i
o
n
to
an
y
ot
h
e
r
ob
l
i
g
a
t
i
o
n
s
de
s
c
r
i
b
e
d
he
r
e
i
n
,
Eu
r
e
k
a
sh
a
l
l
:
A.
Pr
o
m
p
t
l
y
pa
y
Fa
r
m
i
n
g
t
o
n
th
e
Pa
y
m
e
n
t
Am
o
u
n
t
as
in
d
i
c
a
t
e
d
ab
o
v
e
fo
r
th
e
ye
a
r
of
se
r
v
i
c
e
,
or
a
pr
o
r
a
t
e
d
sh
a
r
e
of
th
e
Pa
y
m
e
n
t
Am
o
u
n
t
fo
r
th
e
le
n
g
t
h
of
se
r
v
i
c
e
ac
t
u
a
l
l
y
pr
o
v
i
d
e
d
if
th
e
co
n
t
r
a
c
t
is
te
r
m
i
n
a
t
e
d
ea
r
l
y
;
2 3
P a g
|5
Page 56 of 352
B.
Pr
o
m
p
t
l
y
di
s
c
l
o
s
e
to
Fa
r
m
i
n
g
t
o
n
an
y
in
f
o
r
m
a
t
i
o
n
Eu
r
e
k
a
ca
n
re
a
s
o
n
a
b
l
y
an
t
i
c
i
p
a
t
e
wi
l
l
di
r
e
c
t
l
y
af
f
e
c
t
it
s
ab
i
l
i
t
y
to
pe
r
f
o
r
m
it
s
ob
l
i
g
a
t
i
o
n
s
un
d
e
r
th
i
s
co
n
t
r
a
c
t
.
C.
Pr
e
s
e
n
t
a
bu
d
g
e
t
an
d
le
v
y
pr
o
p
o
s
a
l
to
th
e
to
w
n
el
e
c
t
o
r
s
at
ea
c
h
an
n
u
a
l
to
w
n
me
e
t
i
n
g
du
r
i
n
g
th
e
te
r
m
of
th
i
s
co
n
t
r
a
c
t
se
e
k
i
n
g
au
t
h
o
r
i
t
y
to
le
v
y
fu
n
d
s
as
ne
e
d
e
d
to
pa
y
th
e
“P
a
y
m
e
n
t
Am
o
u
n
t
”
.
12
.
AM
E
N
D
M
E
N
T
.
Th
i
s
Ag
r
e
e
m
e
n
t
ma
y
be
am
e
n
d
e
d
at
an
y
ti
m
e
by
th
e
mu
t
u
a
l
ag
r
e
e
m
e
n
t
of
th
e
pa
r
t
i
e
s
.
An
y
su
c
h
am
e
n
d
m
e
n
t
sh
a
l
l
be
in
wr
i
t
i
n
g
an
d
wi
l
l
be
at
t
a
c
h
e
d
to
th
i
s
Ag
r
e
e
m
e
n
t
.
13
.
PR
I
O
R
I
T
Y
OF
RE
S
P
O
N
S
E
.
Eu
r
e
k
a
ac
k
n
o
w
l
e
d
g
e
s
th
a
t
Fa
r
m
i
n
g
t
o
n
ma
y
en
t
e
r
in
t
o
co
n
t
r
a
c
t
s
wi
t
h
ot
h
e
r
go
v
e
r
n
m
e
n
t
a
l
un
i
t
s
or
pr
i
v
a
t
e
pa
r
t
i
e
s
to
pr
o
v
i
d
e
?r
e
pr
o
t
e
c
t
i
o
n
se
r
v
i
c
e
s
an
d
th
a
t
su
c
h
ob
l
i
g
a
t
i
o
n
s
ma
y
im
p
a
c
t
se
r
v
i
c
e
s
.
Fa
i
l
u
r
e
to
pr
o
v
i
d
e
?r
e
se
r
v
i
c
e
s
be
c
a
u
s
e
of
po
o
r
we
a
t
h
e
r
co
n
d
i
t
i
o
n
s
or
ot
h
e
r
co
n
d
i
t
i
o
n
s
be
y
o
n
d
th
e
co
n
t
r
o
l
of
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
no
t
be
de
e
m
e
d
a
br
e
a
c
h
of
th
i
s
co
n
t
r
a
c
t
.
14
.
MI
N
N
E
S
O
T
A
LA
W
GO
V
E
R
N
S
.
Th
i
s
Ag
r
e
e
m
e
n
t
sh
a
l
l
be
go
v
e
r
n
e
d
by
an
d
co
n
s
t
r
u
e
d
in
ac
c
o
r
d
a
n
c
e
wi
t
h
th
e
in
t
e
r
n
a
l
la
w
s
of
th
e
St
a
t
e
of
Mi
n
n
e
s
o
t
a
.
Al
l
pr
o
c
e
e
d
i
n
g
s
re
l
a
t
e
d
to
th
i
s
Ag
r
e
e
m
e
n
t
sh
a
l
l
be
ve
n
u
e
d
in
Da
k
o
t
a
Co
u
n
t
y
,
St
a
t
e
of
Mi
n
n
e
s
o
t
a
.
15
.
SE
V
E
R
A
B
I
L
I
T
Y
.
Th
e
pr
o
v
i
s
i
o
n
s
of
th
i
s
Ag
r
e
e
m
e
n
t
sh
a
l
l
be
de
e
m
e
d
se
v
e
r
a
b
l
e
.
If
an
y
pa
r
t
of
th
i
s
Ag
r
e
e
m
e
n
t
is
re
n
d
e
r
e
d
vo
i
d
,
in
v
a
l
i
d
or
ot
h
e
r
w
i
s
e
un
e
n
f
o
r
c
e
a
b
l
e
,
su
c
h
re
n
d
e
r
i
n
g
sh
a
l
l
no
t
af
f
e
c
t
th
e
va
l
i
d
i
t
y
an
d
en
f
o
r
c
e
a
b
i
l
i
t
y
of
th
e
re
m
a
i
n
d
e
r
of
th
i
s
Ag
r
e
e
m
e
n
t
.
16
.
NO
WA
I
V
E
R
.
No
t
h
i
n
g
he
r
e
i
n
sh
a
l
l
be
co
n
s
t
r
u
e
d
to
wa
i
v
e
or
li
m
i
t
an
y
im
m
u
n
i
t
y
fr
o
m
,
or
li
m
i
t
a
t
i
o
n
on
,
li
a
b
i
l
i
t
y
av
a
i
l
a
b
l
e
to
ei
t
h
e
r
pa
r
t
y
,
wh
e
t
h
e
r
se
t
fo
r
t
h
in
Mi
n
n
e
s
o
t
a
St
a
t
u
t
e
s
,
Ch
a
p
t
e
r
46
6
or
ot
h
e
r
w
i
s
e
.
17
.
SE
R
V
I
C
E
CO
N
T
R
A
C
T
.
Th
i
s
is
a
se
r
v
i
c
e
co
n
t
r
a
c
t
.
Th
e
pa
r
t
i
e
s
do
no
t
in
t
e
n
d
to
un
d
e
r
t
a
k
e
or
cr
e
a
t
e
,
an
d
no
t
h
i
n
g
he
r
e
i
n
sh
a
l
l
be
co
n
s
t
r
u
e
d
as
cr
e
a
t
i
n
g
,
aj
o
i
n
t
po
w
e
r
s
ag
r
e
e
m
e
n
t
,
jo
i
n
t
ve
n
t
u
r
e
,
or
j
o
i
n
t
en
t
e
r
p
r
i
s
e
be
t
w
e
e
n
th
e
pa
r
t
i
e
s
.
[R
e
m
a
i
n
d
e
r
of
pa
g
e
in
t
e
n
t
i
o
n
a
l
l
y
le
f
t
bl
a
n
k
.
Si
g
n
a
t
u
r
e
pa
g
e
s
fo
l
l
o
w
.
]
2 3 0 4
P a g
6
Page 57 of 352
Signature Page to Fire Services Agreement
CITY OF FARMINGTON
By: _____________ _ Joshua Hoyt, Mayor
And: --------------Shirley R Buecksler, City Clerk
230402v7 Page 17
Page 58 of 352
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2 3 0 4
P a g
8
Page 59 of 352
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Page 63 of 352
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
re
s
p
o
n
d
to
al
l
su
c
h
em
e
r
g
e
n
c
i
e
s
in
Eu
r
e
k
a
wi
t
h
th
e
mi
n
i
m
u
m
ap
p
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p
r
i
a
t
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pe
r
s
o
n
n
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l
an
d
ap
p
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a
t
u
s
as
de
t
e
r
m
i
n
e
d
by
th
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de
c
i
s
i
o
n
of
Fa
r
m
i
n
g
t
o
n
’
s
Fi
r
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Ch
i
e
f
or
ot
h
e
r
ra
n
k
i
n
g
of
?
c
e
r
or
of
?
c
i
a
l
in
ch
a
r
g
e
of
th
e
?r
e
de
p
a
r
t
m
e
n
t
at
th
e
ti
m
e
.
Th
e
pa
r
t
i
e
s
un
d
e
r
s
t
a
n
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th
e
?r
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de
p
a
r
t
m
e
n
t
of
?
c
e
r
in
ch
a
r
g
e
of
th
e
pa
r
t
i
c
u
l
a
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sc
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n
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sh
a
l
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ex
e
r
c
i
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e
ju
d
g
m
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n
t
to
de
t
e
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m
i
n
e
,
in
co
n
s
i
d
e
r
a
t
i
o
n
of
al
l
th
e
es
t
a
b
l
i
s
h
e
d
po
l
i
c
i
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s
,
gu
i
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e
l
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n
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s
,
pr
o
c
e
d
u
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s
,
an
d
pr
a
c
t
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,
ho
w
be
s
t
to
al
l
o
c
a
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e
th
e
av
a
i
l
a
b
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e
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s
o
u
r
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s
of
th
e
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de
p
a
r
t
m
e
n
t
un
d
e
r
th
e
ci
r
c
u
m
s
t
a
n
c
e
s
of
a
gi
v
e
n
si
t
u
a
t
i
o
n
.
Fa
i
l
u
r
e
to
pr
o
v
i
d
e
se
r
v
i
c
e
s
be
c
a
u
s
e
of
po
o
r
we
a
t
h
e
r
co
n
d
i
t
i
o
n
s
or
ot
h
e
r
co
n
d
i
t
i
o
n
s
be
y
o
n
d
th
e
co
n
t
r
o
l
of
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
no
t
be
de
e
m
e
d
a
br
e
a
c
h
of
th
i
s
co
n
t
r
a
c
t
.
Th
e
pa
r
t
i
e
s
un
d
e
r
s
t
a
n
d
an
d
ag
r
e
e
th
a
t
Fa
r
m
i
n
g
t
o
n
wi
l
l
en
d
e
a
v
o
r
to
re
a
s
o
n
a
b
l
y
pr
o
v
i
d
e
th
e
se
r
v
i
c
e
s
in
d
i
c
a
t
e
d
ab
o
v
e
gi
v
e
n
th
e
ci
r
c
u
m
s
t
a
n
c
e
s
,
bu
t
Fa
r
m
i
n
g
t
o
n
ma
k
e
s
no
gu
a
r
a
n
t
e
e
s
th
a
t
th
e
se
r
v
i
c
e
s
it
ac
t
u
a
l
l
y
pr
o
v
i
d
e
s
in
a
gi
v
e
n
si
t
u
a
t
i
o
n
wi
l
l
me
e
t
an
y
pa
r
t
i
c
u
l
a
r
cr
i
t
e
r
i
a
or
st
a
n
d
a
r
d
.
F
ar
m
i
n
g
t
o
n
an
d
it
s
of
?
c
e
r
s
,
em
p
l
o
y
e
e
s
an
d
vo
l
u
n
t
e
e
r
s
sh
a
l
l
no
t
be
li
a
b
l
e
to
Eu
r
e
k
a
or
an
y
ot
h
e
r
pe
r
s
o
n
fo
r
fa
i
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u
r
e
to
fu
r
n
i
s
h
as
s
i
s
t
a
n
c
e
un
d
e
r
th
i
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ag
r
e
e
m
e
n
t
or
fo
r
re
c
a
l
l
i
n
g
as
s
i
s
t
a
n
c
e
.
3.
CO
M
P
E
N
S
A
T
I
O
N
.
A.
Eu
r
e
k
a
ag
r
e
e
s
to
pa
y
F
ar
m
i
n
g
t
o
n
an
n
u
a
l
l
y
du
r
i
n
g
th
e
te
r
m
of
th
i
s
co
n
t
r
a
c
t
th
e
Pa
y
m
e
n
t
Am
o
u
n
t
de
t
e
r
m
i
n
e
d
an
n
u
a
l
l
y
ac
c
o
r
d
i
n
g
to
th
e
fo
l
l
o
w
i
n
g
fo
r
m
u
l
a
.
Th
e
fo
l
l
o
w
i
n
g
pe
r
c
e
n
t
a
g
e
s
re
l
a
t
e
sp
e
c
i
?
c
a
l
l
y
to
Eu
r
e
k
a
in
re
l
a
t
i
o
n
to
th
e
re
s
p
o
n
s
e
ar
e
a
de
p
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c
t
e
d
in
Ex
h
i
b
i
t
A
to
wh
i
c
h
Fa
r
m
i
n
g
t
o
n
pr
o
v
i
d
e
s
?r
e
se
r
v
i
c
e
s
as
th
e
pr
i
m
a
r
y
se
r
v
i
c
e
pr
o
v
i
d
e
r
.
Nu
m
b
e
r
of
?r
e
se
r
v
i
c
e
ca
l
l
s
to
Eu
r
e
k
a
av
e
r
a
g
e
d
ov
e
r
th
e
pr
e
c
e
d
i
n
g
th
r
e
e
ca
l
e
n
d
a
r
ye
a
r
s
(n
o
t
in
c
l
u
d
i
n
g
re
c
a
l
l
e
d
ca
l
l
s
)
as
a
pr
o
p
o
r
t
i
o
n
of
al
l
se
r
v
i
c
e
ca
l
l
s
re
s
p
o
n
d
e
d
to
by
th
e
F
ar
m
i
n
g
t
o
n
Fi
r
e
De
p
a
r
t
m
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t
in
th
a
t
ti
m
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pe
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:
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s
Eu
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k
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p
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in
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(a
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by
th
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as
s
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r
)
as
a
pr
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p
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t
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of
th
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ma
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k
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d
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in
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se
r
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d
by
th
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23
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v
7
Pa
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Page 64 of 352
To
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p
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B.
23
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4
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v
7
Fo
r
th
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pu
r
p
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s
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s
of
th
i
s
fo
r
m
u
l
a
,
po
p
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a
t
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o
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sh
a
l
l
be
de
t
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r
m
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n
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by
th
e
mo
s
t
cu
r
r
e
n
t
st
a
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de
m
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a
p
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av
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on
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’
s
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e
d
as
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t
po
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y
,
sh
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c
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p
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d
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st
a
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m
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s
sh
a
l
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pr
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d
to
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k
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on
a
qu
a
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ba
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fo
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d
to
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k
a
fo
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pa
y
m
e
n
t
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k
a
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pa
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fo
r
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t
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th
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da
y
s
af
t
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r
bi
l
l
i
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g
by
Fa
r
m
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g
t
o
n
.
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g
t
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ma
y
im
p
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s
e
ch
a
r
g
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fo
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it
s
se
r
v
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c
e
s
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d
e
r
th
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s
Ag
r
e
e
m
e
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t
to
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k
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re
s
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n
t
s
,
pr
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y
ow
n
e
r
s
,
an
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pe
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s
to
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ex
t
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n
e
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s
,
an
d
ot
h
e
r
pe
r
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s
.
Eu
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k
a
To
w
n
Bo
a
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d
sh
a
l
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as
s
i
s
t
in
th
e
co
l
l
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c
t
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th
e
ch
a
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s
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a
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t
Eu
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k
a
pr
o
p
e
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e
s
or
by
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h
e
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la
w
f
u
l
me
a
n
s
of
co
l
l
e
c
t
i
o
n
.
It
is
un
d
e
r
s
t
o
o
d
an
d
ag
r
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e
d
Eu
r
e
k
a
sh
a
l
l
ha
v
e
no
re
s
p
o
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s
i
b
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l
i
t
y
wh
a
t
s
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e
v
e
r
to
w
a
r
d
th
e
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e
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g
h
t
e
r
s
or
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h
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e
r
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pe
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s
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su
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pe
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w
s
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su
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h
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RL
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u
e
s
.
It
is
fu
r
t
h
e
r
ag
r
e
e
d
Eu
r
e
k
a
ha
s
no
re
s
p
o
n
s
i
b
i
l
i
t
y
,
be
y
o
n
d
pa
y
i
n
g
th
e
ag
r
e
e
d
up
o
n
Pa
y
m
e
n
t
Am
o
u
n
t
,
fo
r
ac
q
u
i
r
i
n
g
,
op
e
r
a
t
i
n
g
,
ma
i
n
t
a
i
n
i
n
g
,
ho
u
s
i
n
g
,
or
re
p
l
a
c
i
n
g
eq
u
i
p
m
e
n
t
as
ne
e
d
e
d
to
pr
o
v
i
d
e
th
e
?r
e
se
r
v
i
c
e
s
de
s
c
r
i
b
e
d
he
r
e
i
n
.
EN
F
O
R
C
E
M
E
N
T
OF
MI
N
N
E
S
O
T
A
ST
A
T
E
FI
R
E
CO
D
E
.
Th
e
Fa
r
m
i
n
g
t
o
n
Fi
r
e
Ch
i
e
f
,
on
be
h
a
l
f
of
Fa
r
m
i
n
g
t
o
n
,
is
he
r
e
b
y
au
t
h
o
r
i
z
e
d
to
ar
e
a
s
an
y
Pa
g
e
3
Fa
r
m
i
n
g
t
o
n
Fi
r
e
D e p ar
t m e nt
:
00
Ha
l
f
of
th
e
po
p
u
l
a
t
io
n
of
al
l
ofEu
r
e
k
a
asapr
o
p
o
r
t
i
o
n
of
th
e
to
t
a
l
po
p
u
l
a
t
i
o
n
th
e
ar
e
a
s
se
r
v
e
d
by
th
e
Fa
r
m
i
n
g
t
o
n
De
p
ar
t
m
en
t
:
”a To
t
a
l
:
00
I3
0 0
Eu
re
k
aCo
s
t
Page 65 of 352
me
c
h
a
n
i
s
m
s
in
c
l
u
d
i
n
g
bu
t
no
t
li
m
i
t
e
d
to
in
j
u
n
c
t
i
v
e
re
l
i
e
f
o
r
an
y
ap
p
l
i
c
a
b
l
e
cr
i
m
i
n
a
l
pr
o
s
e
c
u
t
i
o
n
.
B.
Th
e
co
s
t
s
to
Fa
r
m
i
n
g
t
o
n
fo
r
an
y
in
c
i
d
e
n
t
re
s
u
l
t
i
n
g
fr
o
m
an
ac
t
of
ne
g
l
i
g
e
n
c
e
or
ca
r
e
l
e
s
s
n
e
s
s
th
a
t
re
q
u
i
r
e
s
em
e
r
g
e
n
c
y
re
s
p
o
n
s
e
se
r
v
i
c
e
s
ma
y
be
bi
l
l
e
d
to
th
e
pa
r
t
y
re
s
p
o
n
s
i
b
l
e
fo
r
su
c
h
ne
g
l
i
g
e
n
c
e
or
ca
r
e
l
e
s
s
n
e
s
s
.
Ex
a
m
p
l
e
s
of
ne
g
l
i
g
e
n
c
e
or
ca
r
e
l
e
s
s
n
e
s
s
in
c
l
u
d
e
,
bu
t
ar
e
no
t
li
m
i
t
e
d
to
,
fa
l
s
e
al
a
r
m
re
s
p
o
n
s
e
s
;
br
u
s
h
bu
r
n
i
n
g
,
de
b
r
i
s
bu
r
n
i
n
g
,
or
re
c
r
e
a
t
i
o
n
a
l
ca
m
p
f
i
r
e
s
th
a
t
re
q
u
i
r
e
an
em
e
r
g
e
n
c
y
re
s
p
o
n
s
e
se
r
v
i
c
e
;
me
t
h
a
m
p
h
e
t
a
m
i
n
e
la
b
ex
p
l
o
s
i
o
n
s
;
an
d
ot
h
e
r
ex
p
l
o
s
i
o
n
s
or
?r
e
s
re
s
u
l
t
i
n
g
fr
o
m
ne
g
l
i
g
e
n
c
e
or
ca
r
e
l
e
s
s
n
e
s
s
.
C.
Th
e
co
s
t
s
to
Fa
r
m
i
n
g
t
o
n
fo
r
an
y
ha
z
a
r
d
o
u
s
ma
t
e
r
i
a
l
sp
i
l
l
s
or
re
l
e
a
s
e
s
re
q
u
i
r
i
n
g
em
e
r
g
e
n
c
y
re
s
p
o
n
s
e
se
r
v
i
c
e
s
ma
y
be
bi
l
l
e
d
to
th
e
pa
r
t
y
re
s
p
o
n
s
i
b
l
e
fo
r
su
c
h
ha
z
a
r
d
o
u
s
ma
t
e
r
i
a
l
sp
i
l
l
s
or
re
l
e
a
s
e
s
.
D.
Th
e
co
s
t
s
to
Fa
r
m
i
n
g
t
o
n
fo
r
em
e
r
g
e
n
c
y
re
s
p
o
n
s
e
se
r
v
i
c
e
s
re
s
u
l
t
i
n
g
fr
o
m
an
ac
t
of
ar
s
o
n
ma
y
be
su
b
m
i
t
t
e
d
to
lo
c
a
l
co
u
r
t
fo
r
re
s
t
i
t
u
t
i
o
n
fr
o
m
th
e
pa
r
t
y
co
n
v
i
c
t
e
d
of
ar
s
o
n
un
d
e
r
Mi
n
n
e
s
o
t
a
la
w
.
E.
An
y
ou
t
s
t
a
n
d
i
n
g
in
v
o
i
c
e
s
to
Fa
r
m
i
n
g
t
o
n
ma
y
be
ce
r
t
i
?
e
d
to
th
e
pr
o
p
e
r
t
y
ta
x
e
s
of
th
e
in
c
i
d
e
n
t
si
t
e
by
Fa
r
m
i
n
g
t
o
n
.
5.
IN
D
E
M
N
I
F
I
C
A
T
I
O
N
.
Fa
r
m
i
n
g
t
o
n
ag
r
e
e
s
to
de
f
e
n
d
an
d
in
d
e
m
n
i
f
y
Eu
r
e
k
a
ag
a
i
n
s
t
an
y
cl
a
i
m
s
br
o
u
g
h
t
or
ac
t
i
o
n
s
fi
l
e
d
ag
a
i
n
s
t
Eu
r
e
k
a
or
an
y
of
f
i
c
e
r
,
em
p
l
o
y
e
e
,
or
vo
l
u
n
t
e
e
r
of
Eu
r
e
k
a
fo
r
in
j
u
r
y
to
,
de
a
t
h
of
,
or
da
m
a
g
e
to
th
e
pr
o
p
e
r
t
y
of
an
y
th
i
r
d
pe
r
s
o
n
or
pe
r
s
o
n
s
,
ar
i
s
i
n
g
fr
o
m
F
ar
m
i
n
g
t
o
n
’
s
pe
r
f
o
r
m
a
n
c
e
un
d
e
r
th
i
s
co
n
t
r
a
c
t
fo
r
se
r
v
i
c
e
s
.
Un
d
e
r
no
ci
r
c
u
m
s
t
a
n
c
e
s
,
ho
w
e
v
e
r
,
sh
a
l
l
Fa
r
m
i
n
g
t
o
n
be
re
q
u
i
r
e
d
to
pa
y
on
be
h
a
l
f
of
it
s
e
l
f
an
d
Eu
r
e
k
a
,
an
y
am
o
u
n
t
s
in
ex
c
e
s
s
of
th
e
li
m
i
t
s
on
li
a
b
i
l
i
t
y
es
t
a
b
l
i
s
h
e
d
in
Mi
n
n
e
s
o
t
a
St
a
t
u
t
e
s
,
Ch
a
p
t
e
r
46
6
ap
p
l
i
c
a
b
l
e
to
an
y
on
e
pa
r
t
y
.
Th
e
li
m
i
t
s
of
li
a
b
i
l
i
t
y
fo
r
Eu
r
e
k
a
an
d
Fa
r
m
i
n
g
t
o
n
ma
y
no
t
be
ad
d
e
d
to
g
e
t
h
e
r
to
de
t
e
r
m
i
n
e
th
e
ma
x
i
m
u
m
am
o
u
n
t
of
li
a
b
i
l
i
t
y
fo
r
Fa
r
m
i
n
g
t
o
n
.
Th
e
in
t
e
n
t
of
th
i
s
su
b
d
i
v
i
s
i
o
n
is
to
im
p
o
s
e
on
Fa
r
m
i
n
g
t
o
n
a
li
m
i
t
e
d
du
t
y
to
de
f
e
n
d
an
d
in
d
e
m
n
i
f
y
Eu
r
e
k
a
fo
r
cl
a
i
m
s
ar
i
s
i
n
g
ou
t
of
th
e
pe
r
f
o
r
m
a
n
c
e
of
th
i
s
co
n
t
r
a
c
t
su
b
j
e
c
t
to
th
e
li
m
i
t
s
of
li
a
b
i
l
i
t
y
un
d
e
r
Mi
n
n
e
s
o
t
a
St
a
t
u
t
e
s
,
Ch
a
p
t
e
r
46
6
.
Th
e
pu
r
p
o
s
e
of
cr
e
a
t
i
n
g
th
i
s
du
t
y
to
de
f
e
n
d
an
d
in
d
e
m
n
i
f
y
is
to
si
m
p
l
i
f
y
th
e
de
f
e
n
s
e
of
c
l
a
i
m
s
by
el
i
m
i
n
a
t
i
n
g
co
n
f
l
i
c
t
s
be
t
w
e
e
n
th
e
pa
r
t
i
e
s
an
d
to
pe
r
m
i
t
li
a
b
i
l
i
t
y
cl
a
i
m
s
ag
a
i
n
s
t
bo
t
h
pa
r
t
i
e
s
fr
o
m
6.
IN
S
U
R
A
N
C
E
.
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
ma
i
n
t
a
i
n
ge
n
e
r
a
l
li
a
b
i
l
i
t
y
in
s
u
r
a
n
c
e
fo
r
it
s
se
r
v
i
c
e
s
an
d
sh
a
l
l
in
c
l
u
d
e
Eu
r
e
k
a
as
an
ad
d
i
t
i
o
n
a
l
in
s
u
r
e
d
fo
r
th
e
te
r
m
of
th
i
s
Ag
r
e
e
m
e
n
t
an
d
an
y
ex
t
e
n
s
i
o
n
s
th
e
r
e
o
f
.
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
ma
i
n
t
a
i
n
in
s
u
r
a
n
c
e
eq
u
a
l
to
or
gr
e
a
t
e
r
th
a
n
th
e
ma
x
i
m
u
m
li
a
b
i
l
i
t
y
ap
p
l
i
c
a
b
l
e
to
mu
n
i
c
i
p
a
l
i
t
i
e
s
as
se
t
fo
r
t
h
in
Mi
n
n
e
s
o
t
a
St
a
t
u
t
e
s
,
Se
c
t
i
o
n
46
6
.
0
4
,
su
b
d
.
1,
as
am
e
n
d
e
d
.
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
pr
o
v
i
d
e
Eu
r
e
k
a
pr
o
o
f
of
su
c
h
in
s
u
r
a
n
c
e
co
v
e
r
a
g
e
s
an
d
th
e
ad
d
i
t
i
o
n
a
l
in
s
u
r
e
d
en
d
o
r
s
e
m
e
n
t
na
m
i
n
g
Eu
r
e
k
a
an
n
u
a
l
l
y
by
th
e
an
n
i
v
e
r
s
a
r
y
da
t
e
of
th
i
s
Ag
r
e
e
m
e
n
t
.
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
al
s
o
ma
i
n
t
a
i
n
wo
r
k
e
r
s
’
co
m
p
e
n
s
a
t
i
o
n
co
v
e
r
a
g
e
as
re
q
u
i
r
e
d
by
la
w
.
7.
MI
N
N
E
S
O
T
A
GO
V
E
R
N
M
E
N
T
DA
T
A
PR
A
C
T
I
C
E
S
AC
T
.
Al
l
da
t
a
co
l
l
e
c
t
e
d
cr
e
a
t
e
d
,
re
c
e
i
v
e
d
,
ma
i
n
t
a
i
n
e
d
,
or
di
s
s
e
m
i
n
a
t
e
d
,
in
an
y
fo
r
m
,
fo
r
an
y
pu
r
p
o
s
e
s
be
c
a
u
s
e
of
th
i
s
23
0
4
0
2
v
7
Pa
g
e
4
Page 66 of 352
Ag
r
e
e
m
e
n
t
is
go
v
e
r
n
e
d
by
th
e
Mi
n
n
e
s
o
t
a
Go
v
e
r
n
m
e
n
t
Da
t
a
Pr
a
c
t
i
c
e
s
Ac
t
(M
i
n
n
e
s
o
t
a
St
a
t
u
t
e
s
,
Ch
a
p
t
e
r
13
an
d
re
l
a
t
e
d
st
a
t
u
t
e
s
)
,
as
am
e
n
d
e
d
,
th
e
Mi
n
n
e
s
o
t
a
Ru
l
e
s
im
p
l
e
m
e
n
t
i
n
g
su
c
h
Ac
t
,
as
am
e
n
d
e
d
,
as
we
l
l
as
Fe
d
e
r
a
l
Re
g
u
l
a
t
i
o
n
s
on
da
t
a
pr
i
v
a
c
y
.
Th
e
pe
r
s
o
n
re
s
p
o
n
s
i
b
l
e
fo
r
re
l
e
a
s
e
of
al
l
da
t
a
un
d
e
r
th
i
s
Ag
r
e
e
m
e
n
t
sh
a
l
l
be
id
e
n
t
i
?
e
d
by
ea
c
h
pa
r
t
y
.
8.
SU
B
C
O
N
T
R
A
C
T
I
N
G
AN
D
AS
S
I
G
N
M
E
N
T
.
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
no
t
su
b
c
o
n
t
r
a
c
t
or
as
s
i
g
n
an
y
po
r
t
i
o
n
of
th
i
s
Ag
r
e
e
m
e
n
t
to
an
o
t
h
e
r
wi
t
h
o
u
t
pr
i
o
r
wr
i
t
t
e
n
pe
r
m
i
s
s
i
o
n
fr
o
m
Eu
r
e
k
a
.
Se
r
v
i
c
e
s
pr
o
v
i
d
e
d
to
Eu
r
e
k
a
pu
r
s
u
a
n
t
to
a
mu
t
u
a
l
ai
d
ag
r
e
e
m
e
n
t
Fa
r
m
i
n
g
t
o
n
ha
s
,
or
ma
y
en
t
e
r
in
t
o
,
wi
t
h
an
o
t
h
e
r
en
t
i
t
y
do
e
s
no
t
co
n
s
t
i
t
u
t
e
a
su
b
c
o
n
t
r
a
c
t
or
as
s
i
g
n
m
e
n
t
re
q
u
i
r
i
n
g
pr
i
o
r
ap
p
r
o
v
a
l
of
Eu
r
e
k
a
so
lo
n
g
as
Fa
r
m
i
n
g
t
o
n
re
m
a
i
n
s
pr
i
m
a
r
i
l
y
re
s
p
o
n
s
i
b
l
e
fo
r
pr
o
v
i
d
i
n
g
?r
e
se
r
v
i
c
e
s
to
th
e
ar
e
a
of
Eu
r
e
k
a
pr
o
v
i
d
e
d
he
r
e
i
n
.
9.
TE
R
M
I
N
A
T
I
O
N
.
Th
i
s
Ag
r
e
e
m
e
n
t
ma
y
be
te
r
m
i
n
a
t
e
d
by
ei
t
h
e
r
Fa
r
m
i
n
g
t
o
n
or
Eu
r
e
k
a
by
gi
v
i
n
g
th
e
ot
h
e
r
pa
r
t
y
at
le
a
s
t
on
e
ye
a
r
’
s
pr
i
o
r
wr
i
t
t
e
n
no
t
i
c
e
of
su
c
h
ca
n
c
e
l
l
a
t
i
o
n
.
10
.
FA
R
M
I
N
G
T
O
N
’
S
RE
S
P
O
N
S
I
B
I
L
I
T
I
E
S
.
In
ad
d
i
t
i
o
n
to
an
y
ot
h
e
r
ob
l
i
g
a
t
i
o
n
s
de
s
c
r
i
b
e
d
he
r
e
i
n
,
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
:
A.
Au
t
h
o
r
i
z
e
an
d
di
r
e
c
t
th
e
Fa
r
m
i
n
g
t
i
o
n
?r
e
de
p
a
r
t
m
e
n
t
to
pr
o
v
i
d
e
th
e
?r
e
se
r
v
i
c
e
s
de
s
c
r
i
b
e
d
he
r
e
i
n
to
Eu
r
e
k
a
;
B.
De
v
e
l
o
p
a
de
t
a
i
l
e
d
an
n
u
a
l
op
e
r
a
t
i
o
n
a
l
bu
d
g
e
t
fo
r
th
e
?r
e
de
p
a
r
t
m
e
n
t
fo
r
ea
c
h
ye
a
r
du
r
i
n
g
th
e
te
r
m
of
th
i
s
co
n
t
r
a
c
t
by
th
e
An
n
i
v
e
r
s
a
r
y
Da
t
e
an
d
pr
e
s
e
n
t
it
to
Eu
r
e
k
a
al
o
n
g
wi
t
h
su
f
?
c
i
e
n
t
in
f
o
r
m
a
t
i
o
n
to
ex
p
l
a
i
n
th
e
it
e
m
s
in
c
l
u
d
e
d
in
th
e
bu
d
g
e
t
?g
u
r
e
s
;
C.
Up
o
n
Eu
r
e
k
a
’
s
re
q
u
e
s
t
,
pr
o
v
i
d
e
Eu
r
e
k
a
ac
c
e
s
s
to
?n
a
n
c
i
a
l
an
d
co
s
t
da
t
a
re
l
a
t
e
d
to
th
e
?r
e
de
p
a
r
t
m
e
n
t
fo
r
?v
e
ye
a
r
s
pr
i
o
r
to
th
e
cu
r
r
e
n
t
se
r
v
i
c
e
ye
a
r
;
D.
Di
s
c
l
o
s
e
to
Eu
r
e
k
a
an
y
pr
o
p
o
s
e
d
ac
t
i
o
n
th
e
Fa
r
m
i
n
g
t
o
n
or
th
e
?r
e
de
p
a
r
t
m
e
n
t
in
t
e
n
d
s
to
ta
k
e
th
a
t
ca
n
re
a
s
o
n
a
b
l
y
be
ex
p
e
c
t
e
d
to
af
f
e
c
t
th
e
In
s
u
r
a
n
c
e
Se
r
v
i
c
e
s
Of
?
c
e
Fi
r
e
Pr
o
t
e
c
t
i
o
n
Gr
a
d
e
in
Eu
r
e
k
a
or
Fa
r
m
i
n
g
t
o
n
’
s
ab
i
l
i
t
y
to
pr
o
v
i
d
e
th
e
?r
e
se
r
v
i
c
e
s
to
Eu
r
e
k
a
;
an
d
to
co
n
t
r
a
c
t
.
11
.
EU
R
E
K
A
’
S
RE
S
P
O
N
S
I
B
I
L
I
T
I
E
S
.
In
ad
d
i
t
i
o
n
to
an
y
ot
h
e
r
ob
l
i
g
a
t
i
o
n
s
de
s
c
r
i
b
e
d
he
r
e
i
n
,
Eu
r
e
k
a
sh
a
l
l
:
A.
Pr
o
m
p
t
l
y
pa
y
Fa
r
m
i
n
g
t
o
n
th
e
Pa
y
m
e
n
t
Am
o
u
n
t
as
in
d
i
c
a
t
e
d
ab
o
v
e
fo
r
th
e
ye
a
r
of
se
r
v
i
c
e
,
or
a
pr
o
r
a
t
e
d
sh
a
r
e
of
th
e
Pa
y
m
e
n
t
Am
o
u
n
t
fo
r
th
e
le
n
g
t
h
of
se
r
v
i
c
e
ac
t
u
a
l
l
y
pr
o
v
i
d
e
d
if
th
e
co
n
t
r
a
c
t
is
te
r
m
i
n
a
t
e
d
ea
r
l
y
;
2 3
P a g
|5
Page 67 of 352
B.
Pr
o
m
p
t
l
y
di
s
c
l
o
s
e
to
Fa
r
m
i
n
g
t
o
n
an
y
in
f
o
r
m
a
t
i
o
n
Eu
r
e
k
a
ca
n
re
a
s
o
n
a
b
l
y
an
t
i
c
i
p
a
t
e
wi
l
l
di
r
e
c
t
l
y
af
f
e
c
t
it
s
ab
i
l
i
t
y
to
pe
r
f
o
r
m
it
s
ob
l
i
g
a
t
i
o
n
s
un
d
e
r
th
i
s
co
n
t
r
a
c
t
.
C.
Pr
e
s
e
n
t
a
bu
d
g
e
t
an
d
le
v
y
pr
o
p
o
s
a
l
to
th
e
to
w
n
el
e
c
t
o
r
s
at
ea
c
h
an
n
u
a
l
to
w
n
me
e
t
i
n
g
du
r
i
n
g
th
e
te
r
m
of
th
i
s
co
n
t
r
a
c
t
se
e
k
i
n
g
au
t
h
o
r
i
t
y
to
le
v
y
fu
n
d
s
as
ne
e
d
e
d
to
pa
y
th
e
“P
a
y
m
e
n
t
Am
o
u
n
t
”
.
12
.
AM
E
N
D
M
E
N
T
.
Th
i
s
Ag
r
e
e
m
e
n
t
ma
y
be
am
e
n
d
e
d
at
an
y
ti
m
e
by
th
e
mu
t
u
a
l
ag
r
e
e
m
e
n
t
of
th
e
pa
r
t
i
e
s
.
An
y
su
c
h
am
e
n
d
m
e
n
t
sh
a
l
l
be
in
wr
i
t
i
n
g
an
d
wi
l
l
be
at
t
a
c
h
e
d
to
th
i
s
Ag
r
e
e
m
e
n
t
.
13
.
PR
I
O
R
I
T
Y
OF
RE
S
P
O
N
S
E
.
Eu
r
e
k
a
ac
k
n
o
w
l
e
d
g
e
s
th
a
t
Fa
r
m
i
n
g
t
o
n
ma
y
en
t
e
r
in
t
o
co
n
t
r
a
c
t
s
wi
t
h
ot
h
e
r
go
v
e
r
n
m
e
n
t
a
l
un
i
t
s
or
pr
i
v
a
t
e
pa
r
t
i
e
s
to
pr
o
v
i
d
e
?r
e
pr
o
t
e
c
t
i
o
n
se
r
v
i
c
e
s
an
d
th
a
t
su
c
h
ob
l
i
g
a
t
i
o
n
s
ma
y
im
p
a
c
t
se
r
v
i
c
e
s
.
Fa
i
l
u
r
e
to
pr
o
v
i
d
e
?r
e
se
r
v
i
c
e
s
be
c
a
u
s
e
of
po
o
r
we
a
t
h
e
r
co
n
d
i
t
i
o
n
s
or
ot
h
e
r
co
n
d
i
t
i
o
n
s
be
y
o
n
d
th
e
co
n
t
r
o
l
of
Fa
r
m
i
n
g
t
o
n
sh
a
l
l
no
t
be
de
e
m
e
d
a
br
e
a
c
h
of
th
i
s
co
n
t
r
a
c
t
.
14
.
MI
N
N
E
S
O
T
A
LA
W
GO
V
E
R
N
S
.
Th
i
s
Ag
r
e
e
m
e
n
t
sh
a
l
l
be
go
v
e
r
n
e
d
by
an
d
co
n
s
t
r
u
e
d
in
ac
c
o
r
d
a
n
c
e
wi
t
h
th
e
in
t
e
r
n
a
l
la
w
s
of
th
e
St
a
t
e
of
Mi
n
n
e
s
o
t
a
.
Al
l
pr
o
c
e
e
d
i
n
g
s
re
l
a
t
e
d
to
th
i
s
Ag
r
e
e
m
e
n
t
sh
a
l
l
be
ve
n
u
e
d
in
Da
k
o
t
a
Co
u
n
t
y
,
St
a
t
e
of
Mi
n
n
e
s
o
t
a
.
15
.
SE
V
E
R
A
B
I
L
I
T
Y
.
Th
e
pr
o
v
i
s
i
o
n
s
of
th
i
s
Ag
r
e
e
m
e
n
t
sh
a
l
l
be
de
e
m
e
d
se
v
e
r
a
b
l
e
.
If
an
y
pa
r
t
of
th
i
s
Ag
r
e
e
m
e
n
t
is
re
n
d
e
r
e
d
vo
i
d
,
in
v
a
l
i
d
or
ot
h
e
r
w
i
s
e
un
e
n
f
o
r
c
e
a
b
l
e
,
su
c
h
re
n
d
e
r
i
n
g
sh
a
l
l
no
t
af
f
e
c
t
th
e
va
l
i
d
i
t
y
an
d
en
f
o
r
c
e
a
b
i
l
i
t
y
of
th
e
re
m
a
i
n
d
e
r
of
th
i
s
Ag
r
e
e
m
e
n
t
.
16
.
NO
WA
I
V
E
R
.
No
t
h
i
n
g
he
r
e
i
n
sh
a
l
l
be
co
n
s
t
r
u
e
d
to
wa
i
v
e
or
li
m
i
t
an
y
im
m
u
n
i
t
y
fr
o
m
,
or
li
m
i
t
a
t
i
o
n
on
,
li
a
b
i
l
i
t
y
av
a
i
l
a
b
l
e
to
ei
t
h
e
r
pa
r
t
y
,
wh
e
t
h
e
r
se
t
fo
r
t
h
in
Mi
n
n
e
s
o
t
a
St
a
t
u
t
e
s
,
Ch
a
p
t
e
r
46
6
or
ot
h
e
r
w
i
s
e
.
17
.
SE
R
V
I
C
E
CO
N
T
R
A
C
T
.
Th
i
s
is
a
se
r
v
i
c
e
co
n
t
r
a
c
t
.
Th
e
pa
r
t
i
e
s
do
no
t
in
t
e
n
d
to
un
d
e
r
t
a
k
e
or
cr
e
a
t
e
,
an
d
no
t
h
i
n
g
he
r
e
i
n
sh
a
l
l
be
co
n
s
t
r
u
e
d
as
cr
e
a
t
i
n
g
,
aj
o
i
n
t
po
w
e
r
s
ag
r
e
e
m
e
n
t
,
jo
i
n
t
ve
n
t
u
r
e
,
or
j
o
i
n
t
en
t
e
r
p
r
i
s
e
be
t
w
e
e
n
th
e
pa
r
t
i
e
s
.
[R
e
m
a
i
n
d
e
r
of
pa
g
e
in
t
e
n
t
i
o
n
a
l
l
y
le
f
t
bl
a
n
k
.
Si
g
n
a
t
u
r
e
pa
g
e
s
fo
l
l
o
w
.
]
2 3 0 4
P a g
6
Page 68 of 352
Signature Page to Fire Services Agreement
CITY OF FARMINGTON
By: _____________ _ Joshua Hoyt, Mayor
And: --------------Shirley R Buecksler, City Clerk
230402v7 Page 17
Page 69 of 352
Si
g n at ur
e
Pa
g
e
toFi
r
e
Se
r
v
i
c
e
s
Ag
r
e
e
m
e
n
t
E U R E K ATO
W
N
S
HI
P
2 3 0 4
P a g
8
Page 70 of 352
2-
2
5
-
T
H
SI
T
I
W
VE
“_
.
_
—
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Page 73 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Julie Flaten, Asst City Admin/HR Director
Department: HR
Subject: Staff Changes and Recommendations
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
Approve the appointment of Joshua Kampe, Kristopher Janke, Justin Kelly, Tabatha Lillie, and
Chase Pankow as Paid-on-Call Firefighters. Also approve the appointment of Bradyn Willford as a
Police Officer and Benjamin Humlie as a Natural Resources Specialist.
DISCUSSION:
The Fire Department conducts an annual recruitment process which begins in January. This
process is extensive and includes candidate informational meetings for both the candidates and
their families, a written knowledge test, interviews, a physical work performance test, drug
screening and background check. All of these steps are done intentionally to recruit and prepare
candidates for the time and training commitment that is required to become a Firefighter in
Farmington. We are excited to invite five new Firefighters to join TEAM Farmington! They will begin
their training on July 15th.
Bradyn Willford has been selected to serve as a Police Officer. Bradyn has served as a Police
Officer in Goodhue, Minnesota, since 2022. He is also an Emergency Medical Responder. We are
excited to have Bradyn join us.
Staff is also recommending the appointment of Benjamin Humlie to the position of Natural
Resources Specialist. Benjamin has spent the past 10 years working for Dakota County where he
worked on natural resource restoration projects, tree identification and maintenance, supervised
work crews, and wrote grants. Ben will join our team on August 7th.
BUDGET IMPACT:
Wages are included in the 2024 budget.
ACTION REQUESTED:
Approve the appointment of Joshua Kampe, Kristopher Janke, Justin Kelly, Tabatha Lillie, and
Chase Pankow as Paid-on-Call Firefighters. Also approve the appointment of Bradyn Willford as a
Police Officer and Benjamin Humlie as a Natural Resources Specialist.
Page 74 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Kellee Omlid, Parks & Recreation Director
Department: Parks & Recreation
Subject: Agreement with Rose Music Services for Solo Acoustic Live-Looping Performance
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
The Parks and Recreation Department hosts four music in the park events.
DISCUSSION:
Vinnie Rose will be performing at one of the music in the park events. His solo acoustic
performance will be Wednesday, July 31, at 7 pm at Rambling River Park. Rose Music Services will
be providing a guitar and singing microphone with amplification system. The agreement is attached.
Mr. Rose has successfully provided music performances for Parks and Recreation in the past and
is great to work with.
The City Attorney reviewed the attached agreement and found it to be acceptable.
BUDGET IMPACT:
The cost for the services Rose Music Services will be providing is $400. The cost for the
performance services will be funded through generous donations from sponsors including Castle
Rock Banks, Hobo, Premier Banks, The Legacy, and VFW Post 7662.
ACTION REQUESTED:
Approve the attached agreement with Rose Music Services to provide a guitar and singing
microphone with amplification to perform a solo acoustic life-looping performance at Rambling River
Park on July 31, 2024.
ATTACHMENTS:
Agreement with Rose Music Services
Page 75 of 352
INDEPENDENT CONTRACTOR AGREEMENT
AGREEMENT made this 1st day of July, 2024, by and between the CITY OF
FARMINGTON, a Minnesota municipal corporation ("City") and ROSE MUSIC SERVICES,
a Minnesota Company ("Contractor"). The City and the Contractor are referred to herein individually
as a “Party” and collectively as the “Parties.”
1.PURPOSE. The purpose of this agreement is to set forth the terms and conditions under
which the Contractor will provide certain services to the City.
2.SERVICES TO BE PERFORMED. The Contractor shall perform the work (the “Services)
as described in Exhibit A to this Agreement which is incorporated herein by reference.
a.The Contractor shall not enter into any subcontracts for Services provided under this
Agreement without the express written consent of the City.
b.This Agreement shall not preclude the City from engaging any other person or entity to
perform the Services, nor shall this Agreement preclude Contractor from providing
similar or related services for any other entity.
c.The Contractor agrees to comply with all federal, state, and local laws and ordinances
applicable to the Services to be performed under this Agreement, including all safety
standards. The Contractor shall be solely and completely responsible for conditions of the
job site, including the safety of all persons and property during the performance of the
Services. The Contractor represents and warrants that it has the requisite training, skills,
and experience necessary to provide the Services and is appropriately licensed by all
applicable agencies and governmental entities and will perform the Services with
reasonable care and skill.
d.The Contractor shall exercise the same degree of care, skill, and diligence in the
performance of the Services as is ordinarily possessed and exercised by a contractor under
similar circumstances.
e.The Contractor shall retain control over its employees, agents, servants, and
subcontractors, as well as control over its invitees, and its activities on and about the
subject premises and the manner in which such activities shall be undertaken and to that
end, the Contractor shall not be deemed to be an agent of the City.
f.The Contractor shall not perform any additional Services without the express written
permission of the City. The City will not pay additional compensation for Services that
do not have prior written authorization.
g.Claims for services furnished by the Contractor not specifically provided for herein shall
not be honored by the City.
3.TERM. This Agreement shall be effective on the date hereof and shall continue, unless
terminated sooner in accordance with the terms of this Agreement, until the Completion Date.
Page 76 of 352
a.Start date: The Contractor shall commence the provision of Services on: Wednesday,
July 31, 2024 at 7 p.m.
b.Completion Date: The Contractor shall complete the Services by Wednesday, July 31,
2024 at 8 p.m.
c.The City may terminate this Agreement for convenience at any time. Termination shall
be effective upon ten (10) days’ written notice to the Contractor.
4.COMPENSATION. As consideration for the provision of the Services, the City agrees to
pay the Contractor as follows: a flat fee of $400.
a.The Contractor shall submit a detailed written invoice to the City upon completion of the
Services.
b.Each invoice shall include in detail the hours worked and a description of the Services
performed.
c.The City shall pay the invoice within 35 days of receipt.
d.If the City objects to all or any portion of any invoice, the City shall notify the Contractor
of the dispute with ten (10) days from the date of receipt and shall pay that portion of the
invoice not in dispute.
5.INDEPENDENT CONTRACTOR RELATIONSHIP. It is expressly understood that the
Contractor is an “independent contractor” and not an employee of the City. The Contractor
shall have control over the manner in which the Services are performed under this Agreement.
The Contractor shall supply, at its own expense, all materials, supplies, equipment and tools
required to accomplish the Services contemplated by this Agreement. The Contractor shall
not be entitled to any benefits from the City, including, without limitation, insurance benefits,
sick and vacation leave, workers’ compensation benefits, unemployment compensation,
disability, severance pay, or retirement benefits. Nothing in this Agreement shall be deemed
to constitute a partnership, joint venture or agency relationship between the Parties.
6.INDEMNIFICATION. To the fullest extent permitted by law, the Contractor agrees to
defend, indemnify and hold harmless the City, and its employees, officials, and agents from
and against all claims, actions, damages, losses and expenses, including reasonable attorney
fees, arising out of the Contractor’s negligence or the Contractor’s performance or failure to
perform its obligations under this Agreement. The Contractor’s indemnification obligation
shall apply to the Contractor’s subcontractor(s), or anyone directly or indirectly employed or
hired by the Contractor, or anyone for whose acts the Contractor may be liable. The
Contractor agrees this indemnity obligation shall survive the completion or termination of this
Agreement.
7.DOCUMENTS. All reports, plans, models, software, diagrams, analyses, and information
generated in connection with performance of this Agreement shall be the property of the City.
The City may use the information for its purposes. The City shall be the copyright owner.
The vesting of the City’s ownership of the copyright in materials created by the Contractor
shall be contingent upon the City’s fulfillment of its payment obligations hereunder. The
Contractor shall be allowed to use a description of the services provided hereunder, including
Page 77 of 352
the name of the City, and photographs or renderings of any projects which develop from the
planning or other services provided by the Contractor, in the normal course of its marketing
activities.
8.GENERAL PROVISIONS.
a.Entire Agreement. This Agreement supersedes any prior or contemporaneous
representations or agreements, whether written or oral, between the Parties and contains
the entire agreement.
b.Assignment. The Contractor may not assign this Agreement to any other person unless
written consent is obtained from the City.
c.Amendments. Any modification or amendment to this Agreement shall require a written
agreement signed by both Parties.
d.Prompt Payment of Subcontractors. Pursuant to Minn. Stat. § 471.425, subd. 4a, the
Contractor must pay any subcontractor within ten (10) days of the Contractor’s receipt of
payment from the City for undisputed services provided by the subcontractor. The
Contractor must pay interest of one and one-half percent (1½ %) per month or any part of
a month to subcontractor on any undisputed amount not paid on time to the subcontractor.
The minimum monthly interest penalty payment for an unpaid balance of $100.00 or
more is $10.00. For an unpaid balance of less than $100.00, Contractor shall pay the
actual penalty due to the subcontractor. A subcontractor who prevails in a civil action to
collect interest penalties from Contractor shall be awarded its costs and disbursements,
including attorney’s fees, incurred in bringing the action.
e.Nondiscrimination. In the hiring of employees to perform work under this Agreement,
the Contractor shall not discriminate against any person by reason of any characteristic or
classification protected by state or federal law.
f.Governing Law. This Agreement shall be governed by and interpreted in accordance with
the laws of the State of Minnesota. All proceedings related to this Agreement shall be
venued in Dakota County, Minnesota.
g.Ownership of Documents. All reports, plans, specifications, data, maps, and other
documents produced by the Contractor in the performance of Services under this
Agreement shall be the property of the City. The City may use such information for its
purposes. The City shall be the copyright owner.
h.Government Data/Privacy. The Contractor agrees to abide by the applicable provisions of
the Minnesota Government Data Practices Act, Minnesota Statues, Chapter 13, and all
other applicable state or federal rules, regulations or orders pertaining to privacy or
confidentiality. The Contractor understands that all of the data created, collected,
received, stored, used, maintained or disseminated by the Contractor in performing those
functions that the City would perform is subject to the requirements of Chapter 13, and
the Contractor must comply with those requirements as if it were a government entity.
This does not create a duty on the part of the Contractor to provide the public with access
to public data if the public data is available from the City, except as required by the terms
of this Agreement.
Page 78 of 352
i.Records. Contractor shall maintain complete and accurate records of time and expense
involved in the performance of services.
j.Audits. Pursuant to Minn. Stat. Section 16C.05, subd. 5, the Contractor’s books, records,
documents, and accounting procedures and practices that are relevant to this Agreement,
are subject to examination by the City and either the Legislative Auditor or the State
Auditor for a minimum of six years from the end of this Agreement.
k.Waiver. The waiver by either party of any breach or failure to comply with any provision
of this Agreement by the other Party shall not be construed as, or constitute a continuing
waiver of such provision or a waiver of any other breach of or failure to comply with any
other provision of this Agreement.
l.Third Party Reliance. This Agreement is intended for the mutual benefit of Parties hereto
and no third-party rights are intended or implied.
m.Notices. All notices and other communications pursuant to this Agreement must be
delivered via email or delivered by registered or certified mail, postage prepaid, or
delivered by hand at the addresses set forth below:
Notice to City: Kellee Omlid, Parks and Recreation Director
komlid@farmingtonmn.gov
430 Third Street, Farmington, MN 55024
Notice to Contractor: Vinnie Rose, Owner / Performer
5091 Eastwood Rd.
Mounds View, MN 55112
n.Force Majeure. Except for payment of sums due, neither Party shall be liable to the other
or deemed in default under this Agreement, if and to the extent that Party’s performance is
prevented by reason of force majeure. “Force majeure” includes war, an act of terrorism,
a pandemic or epidemic, fire, earthquake, flood and other circumstances which are
beyond the control and without the fault or negligence of the Party affected and which by
the exercise of reasonable diligence the Party affected was unable to prevent.
o.Savings Clause. If any court finds any portion of this Agreement to be contrary to law,
invalid, or unenforceable, the remainder of the Agreement will remain in full force and
effect.
p.Counterparts. This Agreement may be signed in counterparts, each of which shall be
deemed an original, and which taken together shall be deemed to be one and the same
document.
Page 79 of 352
IN WITNESS WHEREOF, the Parties, have caused this Agreement to be approved on the date above.
Dated: July 1, 2024. CITY OF FARMINGTON
BY: _______________________________________
Joshua Hoyt, Mayor
AND
Shirley R Buecksler, City Clerk
Dated: _____6/13__________,
2024.
CONTRACTOR: ROSE MUSIC SERVICES
BY:
Owner/Performer
Vincent Rose
Page 80 of 352
_________________________________________________________________
__________________________ ___________________________________
Preformance Type Vinnie Rose—Solo Acoustic Live-Looping
Date Wednesday, July 31st, 2024
Location
Time of Day 7-8pm
Compensation $400
Other Notes:
Contract of Professional Services
This document confirms the agreement between Rose Music Services and
City of Farmington, MN
Rose Music Services agrees to perform music as presented:
Rambling River Park—Farmington, MN
Page 1 of 3
Exhibit A
Page 81 of 352
Service provisions:1. guitar and singing microphone with amplification system proivded.
2. event lighting is NOT included in this package.
Terms and
Conditions:1. One 10 minute break on the hour for events longer than 1 hour.
2. AC outlet within 50ft of stage or performing area.
3. The event holder will be liable for any injuries and/or property damaged or destroyed at the
performance location due to faulty performance area conditions or patron carelessness.
4. All compensation to be transacted BEFORE commencement of musical performance.
5. Substitute musicians may be used in situations of family emergency, illness or other emergency like
situations with mutual agreement of both parties.
6. Any specific song requests must be submitted in writing via email at least 1 month prior to the event
date. All song requests are subject to Vinnie Rose approval.
7.Outdoor events - a tent/overhead tarp/canopy or other rain/sun proof measure must be provided by
event holder for all outdoors events. If event holder is unable to provide such measure(s) an upcharge
of $75 will be applied to the final balance for tent rental/and or set-up by Vinnie Rose regardless if tent
is deployed/not deployed on day of event. Vinnie Rose will not perform in, inclement or severe
weather conditions. Inclement/severe weather will be decided at the sole discretion of Vinnie Rose.
7.A - Vinnie Rose agrees to perform outdoor weather when the temprature is 55 degrees or above
unless other arrangements to compensate for cold weather are made an approved by Vinnie. There are
no refunds if client choose to cancel an event due to cold weather.
8. Client may request to have Vinnie Rose arrive for an early setup. Requests are subject to Vinnie
Rose approval. An early set-up fee may apply ($50/hr.).
9.Meals to be provided by event holder for Vinnie Rose, and any addl. contracted musicians if playing
over the dinner hours.
Cancellations/
Future
Enguagements:
1. No penalty for cancelation 90 calendar days prior to event date.
2. Any cancelation within 90 days of the event full payment is due to Vinnie Rose
3. In the event of rain or incliment weather the event holder will notify Vinnie Rose if an alternate
indoor location will be provided. Full payment due in the event the event holder cancels the
performace outright due to inclement weather.
4. There are no refunds for cancelations due to Corona Virus/pandemic related issues
Page 2 of 3 Page 82 of 352
City of Farmington
_______________________________________________
(Vinnie Rose/Rose Music Services)
_______________________________________________
(Signature)
_______________________________________________
(date)
*please make checks payable to ‘Rose Music Services’
Rose Music Services
5091 Eastwood Rd.
Mounds View, MN 55112
Phone: 612-432-4479
vincentkrose@hotmail.com
Page 3 of 3
___________________________________ July 1, 2024
Kellee Omlid, Parks & Recreation Director
City of Farmington
430 Third Street
Farmington, MN 55024
Phone: 651-280-6851
KOmlid@FarmingtonMN.gov
Page 83 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Kellee Omlid, Parks & Recreation Director
Department: Parks & Recreation
Subject: Donation of Gift Cards and Water Bottles from Twin Cities Running Company to
the Dew Run
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
A donation of gift cards and water bottles for the 44th Annual Dew Run was received from Twin
Cities Running Company in Burnsville.
DISCUSSION:
Twin Cities Running Company recently donated $840 in gift cards and 12 water bottles for the Dew
Run. The gift cards and water bottles were prizes for the first-place winners in varying age brackets
for men and women in the 1-mile and 4-mile races. The 2024 Dew Run was held on Saturday, June
22, and included a 1-mile race, ½ mile jr. jog, and 4-mile race. One hundred thirteen people
participated in the 1 and 4-mile races.
Staff will communicate the City’s appreciation on behalf of the City Council to Twin Cities Running
Company for this generous donation.
ACTION REQUESTED:
Adopt Resolution 2024-58 Accepting a Donation of Gift Cards and Water Bottles to the Dew Run
from Twin Cities Running Company.
ATTACHMENTS:
2024-58 Accepting Donation from Twin Cities Running Company
Page 84 of 352
CITY OF FARMINGTON
DAKOTA COUNTY, MINNESOTA
RESOLUTION 2024-58
A RESOLUTION ACCEPTING A DONATION OF
GIFT CARDS AND WATER BOTTLES TO THE DEW RUN
FROM TWIN CITIES RUNNING COMPANY
WHEREAS, the City of Farmington is generally authorized to accept donations of real
and personal property pursuant to Minnesota Statutes Section 465.03 for the benefit of its citizens
and is specifically authorized to accept gifts, as allowed by law; and
WHEREAS, the following persons and entities have offered to contribute to the City:
Twin Cities Running Company has donated $840 in gift cards and 12 water
bottles; and
WHEREAS, it is in the best interest of the City to accept this donation.
NOW, THEREFORE, BE IT RESOLVED that Mayor Hoyt and the Farmington City
Council hereby accept with gratitude the generous donation of $840 in gift cards and 12 water
bottles from Twin Cities Running Company.
Adopted by the City Council of the City of Farmington, Minnesota, this 1st day of July 2024.
ATTEST:
____________________________ ______________________________
Joshua Hoyt, Mayor Shirley R Buecksler, City Clerk
Page 85 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Jim Constantineau, Deputy Police Chief
Department: Police
Subject: Amendment to the Criminal Justice Network Joint Powers Agreement
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
In 2021, the City Council approved the Joint Powers Agreement (JPA) creating the Criminal Justice
Network (CJN). Due to the addition of another City joining CJN, the original JPA must be amended.
DISCUSSION:
CJN became a Joint Powers Organization in January 2022, after over 20 years as a department of
Dakota County. During the last two years, CJN has been able to be more nimble and embarked on
a project to create a new Records Management System (RMS). The CJN Executive Director had
contact with the Chief of Police in Plymouth and learned that they too needed a new RMS.
After several months of discussion, the CJN Board, made up of members from the CJN JPA (the
Cities of Burnsville, Farmington, Hastings, Inver Grove Heights, Mendota Heights, Rosemount,
South St. Paul, West St. Paul, Dakota County, and the Dakota County Sheriff’s Office) agreed to
have the City of Plymouth join the CJN JPA as a full member. Adding this additional City requires
the original JPA be amended. Plymouth’s contributions to the RMS project, as well as their ongoing
contributions, are outlined in the amendment. The amendment does not extend the JPA beyond the
initial term ending in 2026.
BUDGET IMPACT:
The addition of Plymouth to the CJN JPA does not change the contributions required of the City of
Farmington. It should be noted that CJN was awarded a federal grant of $963,000 to be used
toward the completion of the RMS project. The grant, cash already on hand in the CJN RMS
development budget, and the contribution of Plymouth is projected to be adequate to fully fund the
project.
ACTION REQUESTED:
Adopt Resolution 2024-49 Approving an Amendment to the Criminal Justice Network Joint Powers
Agreement.
ATTACHMENTS:
Res 2024-49 Amendment to CJN JPA
KS24-75 C0034292.1_CJN JPA_1st amendment w signature pages
Page 86 of 352
Page 87 of 352
CITY OF FARMINGTON
DAKOTA COUNTY, MINNESOTA
RESOLUTION 2024-49
A RESOLUTION APPROVING AN AMENDMENT TO
THE CRIMINAL JUSTICE NETWORK JOINT POWERS AGREEMENT
WHEREAS, the City of Farmington is a member of the Criminal Justice Network Joint
Powers Agreement (“JPA”); and
WHEREAS, the JPA was initially approved by the City Council on September 20, 2021;
and
WHEREAS, the City of Plymouth is joining the Criminal Justice Network JPA, requiring
an amendment to the original JPA.
NOW, THEREFORE, BE IT RESOLVED, that Farmington Mayor and City Council
hereby approve the amendment to the Criminal Justice Network Joint Powers Agreement.
Adopted by the City Council of the City of Farmington, Minnesota, this 1st day of July 2024.
ATTEST:
____________________________ ______________________________
Joshua Hoyt, Mayor Shirley R Buecksler, City Clerk
Page 88 of 352
Dakota Contract # C0034292.1
Page 1 of 11
First Amendment to the Joint Powers Agreement
Establishing the Criminal Justice Network
WHEREAS, effective on January 1, 2022, the County of Dakota, the City of Burnsville, the City of Farmington,
the City of Hastings, the City of Inver Grove Heights, the City of Mendota Heights, the City of Rosemount, the
City of South St. Paul, and the City of West St. Paul (“Initial Members”) entered into a five-year joint powers
agreement (“Agreement”) forming the Criminal Justice Network, a MN joint powers organization, (“CJN” or “CJN
Board”); and
WHEREAS, the Initial Members desire to amend the Agreement to amend the CJN annual budget funding
structure in fiscal year 2026 and correct a scrivener’s error in the Agreement to correctly reflect an Initial Term of
five years; and
WHEREAS, the Initial Members desire to amend the Agreement to add the City of Plymouth as a party to the
Agreement and Member of the CJN Board, subject to the conditions contained herein; and
WHEREAS, the Agreement provides that the Agreement may be amended at any time by agreement of all
Members.
ACCORDINGLY, in consideration of the mutual promises contained herein, the Initial Members and City of
Plymouth agree to amend the Agreement (“First Amendment”) as follows:
1. Effective upon the last required signature to this First Amendment, the City of Plymouth is a Member of the
CJN Board and a party to the Agreement, as amended herein, and accepts the terms and conditions
thereof, including any conditions specific to the City of Plymouth.
2. Article 3 (Term and Effective Date) of the Agreement is deleted in its entirety and replaced with the
following:
“This Agreement is effective, and the joint powers entity is established, on January 1, 2022, referred to
herein as the Effective Date, and shall continue until December 31, 2026, or until terminated as
provided in Article 10 or as required by law or court order (“Initial Term”).
3. Article 8 (Budget and Financing) of the Agreement is amended as follows:
3.1. Section 8.3 paragraph B. of the Agreement is deleted in its entirety and replaced with the following:
“B. From the Date of Execution through the end of fiscal year 2025, the CJN annual budget (Total
Membership Fees) will be comprised of a minimum of two funding components: Operations and
Records Management System (RMS). Section 8.3. paragraphs C. and D. are only applicable
through the end of fiscal year 2025 for the Initial Members. Beginning in fiscal year 2026, the
CJN annual budget (Total Membership Fees) will be comprised of a minimum of two funding
components: Operations and Future Development, as described in Section 8.3 paragraph G.
Section 8.3 paragraphs C. and D. shall not apply to any Member after the beginning of fiscal
year 2026. During the Initial Term, the County will contribute a fixed annual subsidy in the
amount of $472,642.00, which shall constitute the County’s annual Total Membership Fees,
except for Membership Fees assessed to the Dakota County Sheriff’s Office pursuant to this
section. There will be no annual adjustment of the subsidy amount.”
3.2. New paragraph G. is added to Section 8.3 of the Agreement, as follows:
“G. Beginning in fiscal year 2026, the Members shall contribute to the Operations fund and
the Future Development fund as described herein.
1. The Members will contribute to the Operations fund as follows: (a) 50%
of the budgetary formula will be based on the population of the
geographical areas for which it provides law enforcement services. For
fiscal year 2026, the population will be determined as of January 1,
2025. For purposes of this paragraph, the geographical area for which
the Sheriff’s Office provides law enforcement services means that area
Page 89 of 352
Dakota Contract # C0034292.1
Page 2 of 11
outside the boundaries of all cities located within Dakota County, but
includes the areas within certain city boundaries that are patrolled by
the Sheriff’s Office; and (a) the other 50% of the budgetary formula will
be based upon the proportional total number of the users determined
as of January 1 of the previous fiscal year.
2. The Members will contribute a fixed annual amount of $3,500 for the
Future Development Fund.”
3.4 New Section 8.9 is added to Article 8 of the Agreement, as follows:
“8.9 City of Plymouth RMS Project Contribution. The City of Plymouth shall contribute Four
Hundred Thousand Dollars ($400,000) to the CJN Board toward the design and build of a new
law enforcement records management system (“RMS Project”), which does not include any
costs the City of Plymouth may incur for data conversion. The City of Plymouth will be
responsible for this contribution as follows:
A. The City of Plymouth will contribute 50% of the total invoices due from CJN for
any contract related to the RMS Project, except for CJN Contract # DCA21380
with GTEL Advisors, LLC for database design and user interfaces.
B. CJN commits to the City of Plymouth that the first contract related to the RMS
Project for which the City of Plymouth will be required to contribute such funds
will be entered into between CJN and GTEL Advisors LLC (“First Contract”),
and that the RMS Project will include integration of computer aided dispatch
and citation information for Hennepin County law enforcement agencies into the
records management system.
C. After the First Contract, the City of Plymouth will be required to contribute its
50% contribution for any CJN contract related to the RMS Project.
D. Notwithstanding anything to the contrary in the Agreement or this First
Amendment, the City of Plymouth is not obligated to contribute Membership
Fees until January 1, 2026, or the go-live date of the records management
system, whichever date is later.”
4. All other terms of the Agreement shall remain in force and effect unless otherwise amended in accordance
with the terms of the Agreement.
In Witness Whereof, the Initial Members and City of Plymouth have executed this First Amendment to the
Agreement on the dates indicated below.
COUNTY OF DAKOTA, MINNESOTA
By______________________________
Its ______________________________
Date ____________________________
Approved as to form
________________________________
Assistant County Attorney Date
File No. KS-24-75
Page 90 of 352
Dakota Contract # C0034292.1
Page 3 of 11
CITY OF BURNSVILLE, MINNESOTA
By: ______________________________
Its: ______________________________
Date: ____________________________
Page 91 of 352
Dakota Contract # C0034292.1
Page 4 of 11
CITY OF FARMINGTON, MINNESOTA
By: ______________________________
Its: ______________________________
Date: ____________________________
Page 92 of 352
Dakota Contract # C0034292.1
Page 5 of 11
CITY OF HASTINGS, MINNESOTA
By: ______________________________
Its: ______________________________
Date: ____________________________
Page 93 of 352
Dakota Contract # C0034292.1
Page 6 of 11
CITY OF INVER GROVE HEIGHTS, MINNESOTA
By: ______________________________
Its: ______________________________
Date: ____________________________
Page 94 of 352
Dakota Contract # C0034292.1
Page 7 of 11
CITY OF MENDOTA HEIGHTS, MINNESOTA
By: ______________________________
Its: ______________________________
Date: ____________________________
Page 95 of 352
Dakota Contract # C0034292.1
Page 8 of 11
CITY OF PLYMOUTH, MINNESOTA
By: ______________________________
Its: ______________________________
Date: ____________________________
Page 96 of 352
Dakota Contract # C0034292.1
Page 9 of 11
CITY OF ROSEMOUNT, MINNESOTA
By: ______________________________
Its: ______________________________
Date: ____________________________
Page 97 of 352
Dakota Contract # C0034292.1
Page 10 of 11
CITY OF SOUTH ST. PAUL, MINNESOTA
By: ______________________________
Its: ______________________________
Date: ____________________________
Page 98 of 352
Dakota Contract # C0034292.1
Page 11 of 11
CITY OF WEST ST. PAUL, MINNESOTA
By: ______________________________
Its: ______________________________
Date: ____________________________
Page 99 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Leah Koch, City Attorney
Department: City Attorney
Subject: Cannabis Business Moratorium
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
Attached for your review and consideration is a moratorium prohibiting the establishment and
operation of cannabis businesses until January 1, 2025.
DISCUSSION:
In 2023, the Minnesota legislature passed a cannabis law which permits personal possession and
consumption of cannabis, while also establishing the groundwork for the eventual cannabis market
in Minnesota. This emerging market encompasses many kinds of cannabis business types
spanning the entire supply chain, from cultivation to retail.
The 2023 cannabis bill gave municipalities the opportunity to regulate, restrict, or prohibit the
operation of a cannabis business within the jurisdiction until January 1, 2025, through a moratorium
otherwise known as an interim ordinance. Minnesota Statute section 342.13(e).
In 2023 and early 2024, the Office of Cannabis Management (OCM) publicly conveyed that no
cannabis business licenses would be issued until 2025. Previously, City Staff felt there was no need
to implement such a moratorium because OCM would not be issuing licenses prior to 2025
anyways.
However, the cannabis law was modified by the legislature in 2024 with both technical and
substantive revisions. One substantive revision is that the OCM is now authorized to issue early
cultivation licenses so growers can begin producing cannabis in 2024.
In light of this new information, Staff now feels it is appropriate to implement the moratorium
prohibiting the operation of all cannabis businesses until January 1, 2025, to protect the planning
process and allow Staff to continue researching the issues and creating recommendations
regarding where cannabis businesses operate in the City.
BUDGET IMPACT:
Not applicable
ACTION REQUESTED:
Approve the passage of Ordinance 2024-06, An Interim Ordinance Prohibiting the Operation of
Page 100 of 352
Cannabis Businesses.
ATTACHMENTS:
Ord 2024-06 Interim Ordinance Prohibiting the Operation of Cannabis Businesses
Page 101 of 352
231214v3
CITY OF FARMINGTON
DAKOTA COUNTY, MINNESOTA
ORDINANCE 2024-06
AN INTERIM ORDINANCE
PROHIBITING THE OPERATION OF CANNABIS BUSINESSES
The City Council of the City of Farmington does ordain:
SECTION 1. BACKGROUND.
1. By enacting 2023 Session Laws Chapter 63, the Minnesota Legislature enacted Minnesota
Statute Chapter 342, legalizing adult-use cannabis and permitting the operation of
cannabis businesses and the sale of cannabis flower and cannabis products for human
consumption. This law creates a new agency, the Office of Cannabis Management, to
regulate the sales of cannabis products.
2. Chapter 342 also establishes new regulations for the sale of lower-potency hemp products
containing THC.
3. The law does enact some requirements for production, labeling and testing, and sale of
cannabis and hemp products at the state government level. However, the new law creates
uncertainty that will need to be resolved by the passage of further regulations by the
Office.
4. The new law establishes that the sale of cannabis- and THC-containing products are still
subject to local planning and zoning restrictions and must comply with local zoning code.
The new law provides no guidance on how cities are to zone the new businesses, leaving
it to local control.
5. Chapter 342 was modified in 2024 through the enactment of 2024 Session Laws Chapter
121 which explicitly authorized the early cultivation of cannabis plants. The Office of
Cannabis Management is anticipated to authorize such operations in 2024.
6. Pursuant to Minnesota Statute 342.13(e), a unit of local government may adopt an
interim ordinance to protect the planning process and the health, safety, and welfare of
its citizens. Prior to adopting the interim ordinance, the governing body must hold a
public hearing on the topic. The interim ordinance may regulate, restrict, or prohibit
the operation of any cannabis business within the local government’s jurisdiction until
January 1, 2025.
SECTION 2. FINDINGS.
1. The City Council finds there is a need to study cannabis products and the uses and
businesses related thereto, in order to assess the necessity for and efficacy of regulation
Page 102 of 352
Ordinance 2024-06
Page 2 of 3
231214v3
and restrictions relating to the sales, testing, manufacturing, and distribution of
cannabis products, including through zoning ordinances, in order to protect the public
health, safety, and welfares of its residents.
2. The study will allow the City Council to determine the appropriate changes, if any, that
it should make to City ordinances.
3. The study was discussed before the City Council at a public hearing held on July 1,
2024.
4. After considering the information available to it, including the testimony of members
of the public at the public hearing convened for that purpose, the City Council finds
that there is a need to adopt a City-wide moratorium on the operation of any Cannabis
Business within the City while Staff studies the issue.
SECTION 3. MORATORIUM.
1. No individual, establishment, organization, or other entity may open or operate any
cannabis business within the City until January 1, 2025.
2. Planning or zoning applications related to cannabis products or applications from
individuals, establishments, organizations, or businesses involved in the proposed sale,
testing, manufacturing, or distribution of cannabis products within the City of
Farmington shall not be accepted or considered while the moratorium is in effect
3. This moratorium does not apply to the selling, testing, manufacturing, or distributing
of THC Products related to the Medical Cannabis Program as administered by the
Minnesota Department of Health, provided that such activity is done in accordance
with the regulations and laws of Minnesota regarding Medical Cannabis.
SECTION 4. STUDY. The City Council directs City Staff to study the need for local regulation
regarding the sale, testing, manufacturing, or distribution of cannabis products and the operation
of Cannabis Businesses within the City of Farmington. Staff must also study the need for creating
or amending zoning ordinances or any other ordinances to protect the citizens of Farmington from
any potential negative impacts of cannabis products or cannabis businesses. Upon completion of
the study, the City Council, together with such commission as the City Council deems appropriate
or, as may be required by law, will consider the advisability of adopting new ordinances or
amending its current ordinances.
SECTION 5. ENFORCEMENT. The City may enforce this Ordinance by mandamus,
injunctive relief, or other appropriate civil remedy in any court of competent jurisdiction. The City
Council hereby authorizes the City Administrator, in consultation with the City Attorney, to initiate
any legal action deemed necessary to secure compliance with this Ordinance. A violation of this
Ordinance is also subject to the City’s general penalty in City Code, Section 1-4.
Page 103 of 352
Ordinance 2024-06
Page 3 of 3
231214v3
SECTION 6. TERM. Unless rescinded earlier by the City Council, the moratorium established
under this Ordinance shall remain in effect until January 1, 2025, at which point, it will
automatically expire.
SECTION 7. SUMMARY PUBLICATION. Because of the lengthy nature of this Ordinance,
the following summary ordinance has been prepared for publication. The City Council directs the
City Clerk to publish only the title and a summary of this ordinance as follows:
AN INTERIM ORDINANCE PROHIBITING THE OPERATION
OF CANNABIS BUSINESSES
This Ordinance places a moratorium on the establishment or operation of cannabis
businesses in the City of Farmington until January 1, 2025. During the moratorium the City
will study potential new regulations related to the performance standards and location of
cannabis business operations within the City.
A printed copy of the ordinance, in its entirety, is available for inspection by any
person during the City’s regular office hours at the office of City Hall, 430 Third Street,
Farmington, Minnesota 55024.
SECTION 8. EFFECTIVE DATE. This ordinance shall be in full force and effect immediately
upon its passage and publication according to law.
Passed by the City Council of the City of Farmington, Minnesota, this 1st day of July 2024.
ATTEST:
____________________________ ______________________________
Joshua Hoyt, Mayor Shirley R Buecksler, City Clerk
Page 104 of 352
REGULAR COUNCIL AGENDA MEMO
To: Mayor, Councilmembers and City Administrator
From: Kim Sommerland, Finance Director
Department: Finance
Subject: 2023 Annual Comprehensive Financial Report and Related Audit Reports
Meeting: Regular Council - Jul 01 2024
INTRODUCTION:
As required by Minnesota law, the City's financial records are audited by an independent public
accounting firm each year. The goal of an independent audit is to provide reasonable assurance
that and financial The presented. accurately analyses statements financial City's the are
management reports done in conjunction with the annual audit function as early warning system for
identifying potential future financial issues.
Upon completion of the audit, the auditors deliver their opinion, discuss their management report
with the City Council, and the City releases an Annual Comprehensive Financial Report (ACFR).
This report aims to furnish the City Council, Staff, citizens, investors, and other stakeholders with
valuable insights to the City's operations and financial position. Annual audit results must be
provided to the Minnesota Office of the State Auditor by the end of June each year.
DISCUSSION:
The City of Farmington assumes full responsibility for the completeness, accuracy, and reliability of
the information presented in the attached ACFR. To provide a reasonable basis for making these
representations, is that framework internal has a established management comprehensive
designed both to protect the government’s assets from loss, theft or misuse, and to compile
sufficient, reliable information for the preparation of the City’s financial statements in conformity with
Generally Accepted Accounting Principles (GAAP). Because the cost of internal controls should not
outweigh their benefits, the City’s comprehensive framework of internal control has been designed
to provide reasonable, rather than absolute, assurance that the financial statements will be free
from material misstatement.
As management, we assert that, to the best of our knowledge and belief, the financial report is
complete and reliable in all material respects; that it is presented in a manner designed to fairly set
forth the financial position and results of operations of the City of Farmington as measured by the
financial activity of its various funds; and that all disclosures necessary to enable the reader to gain
the maximum understanding of the City’s financial affairs have been included.
The City's financial records have been audited by Malloy, Montague, Karnowski, Radosevich & Co.,
P.A. (MMKR). Based upon their audit, they concluded there was a reasonable basis for rendering
an unmodified (‘clean’) opinion that the City of Farmington’s financial statements for the fiscal year
ended December 31, 2023 are fairly presented in conformity with GAAP. An unmodified opinion is
Page 105 of 352
issued when the auditor assesses that the financial statements are true and fair, with no material
misstatements. The auditors did identify a compliance issue with Minnesota’s contracting and
bidding requirements for one particular contract. A summary of the 2023 audit, including the
auditor’s opinion and finding, can be found in the attached Management Report. The report also
addresses resolution of findings from previous years.
In addition to the standard annual audit, the City was required to have a separate examination to
ensure compliance with the requirements of the Coronavirus State and Local Recovery Funds’
program. The related reported has been provided for your review.
Bill Lauer, CPA of MMKR, will review the 2023 audit, provide a financial overview of the City's 2023
results, share their internal control findings, and respond to any questions of the City Council
regarding the same.
BUDGET IMPACT:
Not applicable
ACTION REQUESTED:
Not applicable
ATTACHMENTS:
2023 Farmington Fin Stmts
2023 Farmington Mgmt Rpt
2023 Farmington Spec Purp
2023 Farmington Fin CSLFRF Compliance Rpt
Page 106 of 352
2023
Annual Comprehensive
Financial Report
For the year ended December 31, 2023
430 Third Street
Farmington, Minnesota 55024
www.farmingtonmn.gov
Page 107 of 352
Page 108 of 352
CITY OF FARMINGTON
DAKOTA COUNTY, MINNESOTA
Annual Comprehensive
Financial Report
for the Year Ended
December 31, 2023
Lynn Gorski
City Administrator
Report Prepared by
Finance Department
Member of Government Finance Officers Association
of the United States and Canada
Page 109 of 352
THIS PAGE INTENTIONALLY LEFT BLANK
Page 110 of 352
Page
INTRODUCTORY SECTION
Letter of Transmittal i–v
GFOA Certificate of Achievement vi
Organizational Chart vii
Elected Officials and Executive Staff viii
FINANCIAL SECTION
INDEPENDENT AUDITOR’S REPORT 1–3
MANAGEMENT’S DISCUSSION AND ANALYSIS 4–15
BASIC FINANCIAL STATEMENTS
Government-Wide Financial Statements
Statement of Net Position 16
Statement of Activities 17–18
Fund Financial Statements
Governmental Funds
Balance Sheet 19–20
Reconciliation of the Balance Sheet to the Statement of Net Position 21
Statement of Revenues, Expenditures, and Changes in Fund Balances 22–23
Reconciliation of the Statement of Revenues, Expenditures, and Changes
in Fund Balances to the Statement of Activities 24
Statement of Revenues, Expenditures, and Changes in Fund Balances –
Budget and Actual – General Fund 25
Proprietary Funds
Statement of Net Position 26–27
Statement of Revenues, Expenses, and Changes in Fund Net Position 28–29
Statement of Cash Flows 30–31
Notes to Basic Financial Statements 32–65
REQUIRED SUPPLEMENTARY INFORMATION
PERA – General Employees Retirement Fund
Schedule of City’s and Nonemployer Proportionate Share of Net Pension Liability 66
Schedule of City Contributions 66
PERA – Public Employees Police and Fire Fund
Schedule of City’s and Nonemployer Proportionate Share of Net Pension Liability 67
Schedule of City Contributions 67
Farmington Fire Fighters’ Relief Association
Schedule of Changes in the Relief Association’s Net Pension Liability (Asset)
and Related Ratios 68
Schedule of City Contributions 69
Other Post-Employment Benefits Plan
Schedule of Changes in the City’s Total OPEB Liability and Related Ratios 70
Notes to Required Supplementary Information 71–79
CITY OF FARMINGTON
Table of Contents
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Page
SUPPLEMENTARY INFORMATION
Combining and Individual Fund Statements and Schedules
Nonmajor Governmental Funds 80
Combining Balance Sheet 81
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 82
Nonmajor Special Revenue Funds 83
Combining Balance Sheet 84–85
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 86–87
Nonmajor Capital Projects Funds 88
Combining Balance Sheet 89–92
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 93–96
Nonmajor Debt Service Fund 97
Combining Balance Sheet by Account 98–99
Combining Schedule of Revenues, Expenditures, and Changes in Fund Balances
by Account 100–101
Budgetary Comparison Schedules 102
Private Capital Projects Fund 103
Storm Water Trunk Capital Projects Fund 104
Nonmajor Special Revenue Funds
Economic Development Authority 105
Dakota Broadband 106
Trident Housing Tax Increment 107
Police Donations and Forfeitures 108
Park Improvement 109
Arena 110
Nonmajor Capital Projects Funds
Sanitary Sewer Trunk 111
Cable Communications 112
State Aid Construction 113
Fire 114
Recreation 115
Permanent Improvement Revolving 116
General Capital Equipment 117
Water Trunk 118
Trail Maintenance 119
Building Maintenance 120
Maintenance 121
Nonmajor Debt Service Fund
Debt Service 122
Internal Service Funds 123
Combining Statement of Net Position 124
Combining Statement of Revenues, Expenses, and Changes in Fund Net Position 125
Combining Statement of Cash Flows 126
CITY OF FARMINGTON
Table of Contents (continued)
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Page
STATISTICAL SECTION (UNAUDITED)
STATISTICAL TABLES (UNAUDITED)127
Net Position by Component 128–129
Changes in Net Position 130–133
Fund Balances of Governmental Funds 134–135
Changes in Fund Balances of Governmental Funds 136–137
Tax Capacity Value and Estimated Actual Value of Taxable Property 138–139
Property Tax Rates 140
Principal Property Taxpayers 141
Property Tax Levies and Collections 142
Ratios of Outstanding Debt by Type 143–144
Ratios of General Bonded Debt Outstanding 145–146
Direct and Overlapping Governmental Activities Debt 147
Legal Debt Margin Information 148–149
Pledged Revenue Coverage 150
Demographic and Economic Statistics 151
Principal Employers 152
Full-Time Equivalent City Government Employees by Function 153–154
Operating Indicators by Function 155–156
Capital Asset Statistics by Function/Program 157–158
CITY OF FARMINGTON
Table of Contents (continued)
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INTRODUCTORY SECTION
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June 20, 2024
To the Honorable Mayor, Members of the City Council, and Citizens of the City of Farmington,
Minnesota,
The Annual Comprehensive Financial Report (ACFR) of the City of Farmington, Minnesota (the City) for
the fiscal year ended December 31, 2023 is hereby submitted. This report was prepared by the
Finance Department and responsibility for both the accuracy of the presented data and the completeness
and fairness of the presentation, including all disclosures, supporting schedules, and statistical tables rests
with the City.
To provide a reasonable basis for making these representations, management of the City has established
a comprehensive internal control framework that is designed to protect the City’s assets from loss, theft,
or misuse, and to compile sufficient reliable information for the preparation of these financial statements
in conformity with accounting principles generally accepted in the United States of America. Because the
cost of internal controls should not outweigh their benefits, the City’s internal controls have been
designed to provide reasonable, rather than the absolute assurance, that the financial statements will be
free from material misstatements.
As management, we assert that to the best of our knowledge and belief, this ACFR is complete and reliable
in all material respects; that it is presented in a manner designed to fairly set forth the financial position
and results of operations of the City as measured by the financial activity of its various funds; and that all
disclosures necessary to enable the reader to gain the maximum understanding of the City’s financial
affairs have been included.
The organization, form, and contents of this report were prepared in accordance with the standards
prescribed by the Governmental Accounting Standards Board, the Government Finance Officers
Association (GFOA) of the United States and Canada, the American Institute of Certified Public
Accountants, Minnesota’s Office of the State Auditor, and city policies.
The City’s financial statements have been audited by Malloy, Montague, Karnowski, Radosevich & Co.,
P.A., a professional firm of certified public accountants. The goal of the independent audit was to provide
reasonable assurance that the financial statements of the City for the year ended December 31, 2023, are
free of material misstatement. The independent audit involved examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements; assessing the accounting principles
used and significant estimates made by management; and evaluating the overall financial statement
presentation. The independent auditor concluded, based upon the audit, that there was a reasonable
basis for rendering an unmodified opinion that the City’s basic financial statements, for the year ended
December 31, 2023, are fairly presented in conformity with accounting principles generally accepted in
the United States of America. The independent auditor’s report is presented as the first component of the
financial section of this report.
This transmittal letter is designed to complement the management’s discussion and analysis (MD&A) and
should be read in conjunction with it. The MD&A can be found immediately following the report of the
independent auditors.
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Profile of the Government
The City is a suburban community located 30 miles south and east of downtown Minneapolis in
Dakota County and was established in 1872 as a railroad center for the surrounding farming community.
The 2010 Census established the City’s population at 21,086, with a current population estimate of
23,719. Additionally, the City’s boundary has grown easterly, adding 1,407 acres of annexation and
growing from 12.5 square miles in 2000, to its current size of 14.8 square miles. The growth that the City
has experienced is due to a number of factors, such as relatively affordable home ownership as compared
to homes north and west of the City, the opportunity to locate further from the inner core, and the
opportunity to live in a community with a “home-town” feel because of its discernable traditional
downtown.
The City operates under the mayor-council form of organization. The governing City Council, consisting of
the mayor and four other councilmembers, is elected at large and on a nonpartisan basis. Terms of office
are staggered four-year terms, with elections held in each even-numbered year. The City Council is
responsible for, among other things, passing ordinances, adopting the budget, appointing members to
the various committees and commissions, and hiring the city administrator, heads of various departments,
and city employees. The city administrator is responsible for carrying out the policies and ordinances of
the City Council, for overseeing the day-to-day operations of the City’s government, and the heads of
various departments and city employees.
The City provides its residents and businesses a full range of municipal services, including police and fire
protection, ambulance services, construction and maintenance of highways, streets, and other
infrastructure, as well as recreational and cultural activities. The City currently operates the following
enterprise funds: municipal liquor operations, sewer, storm water, water, and streetlights. In 2022, the
City began the process to transition its solid waste operations to a private contractor and discontinued
operations in 2023. The City also contributes to the senior center operations, ice arena, community
recreation services, and several other important community-based events and projects.
Economic Condition
The information presented in the financial statements is perhaps best understood when it is considered
from the broader perspective of the specific environment within which the City operates.
Local Economy
Major industries located within the City’s boundaries include the Independent School District (ISD)
No. 192, Federal Aviation Administration, a building materials and installation company, an electric utility
cooperative, an assisted living facility, an independent living senior facility, a transportation company, a
trucking company, and manufacturers of dairy products. ISD No. 192 provides a significant economic
presence providing employment to more than 800 people. The Federal Aviation Administration and
Installed Building Solutions employ 366 and 284 people, respectively.
During 2023, a number of new businesses opened or expanded including the start of a large expansion of
an existing building in the Industrial Park. The City continues to partner with Dakota County to offer the
Open to Business initiative, which provides financial and business advice to small and future business
owners.
New residential construction was higher in 2023 compared to 2022. In 2023, the City issued new
construction permits for 87 new single-family units, 61 townhome units, and a 74-unit market rate
apartment building. The new residential permits resulted in a total building valuation of $43,721,566. The
number of foreclosures in the City remained relatively flat. There were 10 foreclosures in the City in 2023,
compared to 9 in 2021 and in 2022.
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Long-Term Planning
The City Council meets each year to review changes that have taken place in the City and identify a set of
priorities for the next one to two years. The City Council established four priorities, which include:
• Business Growth
• Community Engagement
• Infrastructure Support
• Employee Engagement
In alignment of established objectives, the City has enhanced its procedures for new development, striving
to offer a more favorable experience for developers considering investment in our municipality.
Furthermore, during the 2023 budget deliberations, the City allocated significant resources to diverse
infrastructure endeavors, particularly focusing on street and trail maintenance. The City Council remains
steadfast in its commitment to achieving set objectives, with a primary focus on enhancing the well-being
of our community.
Throughout 2023, staff reviewed and updated various capital improvement plans, with particular
emphasis on those pertaining to streets, trails, and equipment, extending the planning horizon to a
10-year framework. This comprehensive review and adjustment process aligns with the City Council’s
overarching priority of bolstering infrastructure support. The mill and overlay program initiated in 2019
persisted throughout 2023, and is slated to continue in the forthcoming years, alongside planned street
reconstruction projects.
The City’s 2040 Comprehensive Plan was completed in 2019. Late in 2022, it was decided to amend the
2040 Comprehensive Plan to update the vision of the City that will guide the next stage of planning and
development, and to secure additional mixed-use areas, including commercial and industrial areas. One
of the City’s primary objectives is to increase mixed-use commercial and industrial zones strategically
across the City. This initiative is crucial for diversifying our tax base, fostering economic resilience, and
creating a vibrant, dynamic community. By incorporating mixed-use development, we aim to attract new
businesses, enhance employment opportunities, and cultivate a thriving local economy that benefits all
residents for years to come. The ongoing work on our visioning plan and the update to the Comprehensive
Plan marks a significant milestone for our community. Engaging residents in defining the City’s vision
ensures that their voices are heard, and that the future development aligns with our shared goals and
aspirations. Additional information about the update of the Comprehensive Plan may be found on the
City’s website, www.farmingtonmn.gov.
Major Initiatives
The City continues to place a high priority on planning for the community’s needs as growth and expansion
issues impact city operations. The availability of land, infrastructure, and services continue to drive the
community development focus of the City.
Investments in the community by the City have a positive impact on the net worth of property owners,
contributing to the overall value growth. The City has prioritized the development of various services,
facilities, and infrastructure, strengthening its financial foundation for residents and stakeholders.
Sustaining high-quality services is instrumental in fostering favorable appreciation of property values
within the community. Significant investments in infrastructure have prolonged the lifespan of existing
roadways and enhanced the quality and safety of others. Recognizing that homes and businesses are
primary assets in citizens’ portfolios, the City remains committed to further enhancing their value. The
City observes a continuous increase in average residential home values, reflecting the effectiveness of
these efforts.
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The City is committed to advancing its community through ongoing development and revitalization
efforts. Leveraging the strength of both its community and organizational resources, the City aims to
foster increased opportunities for its constituents. Regular review and updates of city ordinances facilitate
new business opportunities. In 2023, the City Council endorsed the second addition of
Vermillion Commons, encompassing 58 townhome lots. Furthermore, progress continues with the
implementation of the Downtown Redevelopment Plan, inclusive of initiatives such as the Micro Grant
Program.
Farmington Municipal Liquor Operations have shown remarkable progress over recent years, a trend that
persisted through 2023. Liquor sales rose by $378,187 compared to 2022, with reported operating income
reaching $553,704. These profits have greatly enriched the community, with the liquor operation
contributing approximately $1.7 million since 2005 to various city departments and community
organizations over the past decade.
The City continues to collaborate with Dakota County, Dakota County Community Development Agency,
Dakota County Regional Chamber of Commerce, the Farmington Business Association, ISD No. 192, nearby
communities, and neighboring townships to provide its citizens with various services.
Relevant Financial Policies
In accordance with the City’s investment policy, the City strives to maintain a fund balance of 40 to
50 percent of subsequent year’s budgeted expenditures as a minimum fund balance level to provide for
cash flow purposes. The City’s debt policy restricts long-term borrowing to capital equipment, public
facilities, or infrastructure that have a life of more than five years and cannot be financed from current
revenues. The maturity length of that debt shall be below 20 years, with at least 50 percent of the principle
retired within 10 years.
Cash temporarily idle during the year was invested in U.S. government treasury notes and agency
obligations, municipal securities, certificates of deposit, and money market instruments. The City’s
investment policy calls for the investment of public funds in a manner that will provide the highest
investment return with minimum risk, while meeting the daily cash flow demands of the City.
Awards
The GFOA of the United States and Canada awarded a Certificate of Achievement for Excellence in
Financial Reporting to the City for its ACFR for the year ended December 31, 2022. This is the 14th year
the City has received this prestigious award. In order to be awarded a Certificate of Achievement, a city
must publish an easily readable and efficiently organized ACFR. This report must satisfy both accounting
principles generally accepted in the United States of America and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe our current ACFR continues
to meet the Certificate of Achievement Program’s requirements and are submitting it to the GFOA of the
United States and Canada to determine its eligibility for another certificate.
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Acknowledgments
The preparation of this report would not have been possible without the talented and dedicated services
of the entire staff of the Finance Department and other key city personnel. We would like to express our
appreciation to all city employees for their meticulousness and adept management of the budget over
the past year. Credit also must be given to the Mayor and the City Council for their steadfast support and
proactive measures in fortifying the City’s financial resilience and fostering long-term financial planning.
Respectively Submitted,
_________________________________
Lynn Gorski, City Administrator
Kim Sommerland, Finance Director
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Residents
Administration
Human
Resources Police Finance
Public Works
City Administrator
City Council
Streets
Utility Billing
Programming
Fire
Parks and
Recreation
Community
Development
Liquor
Operations
Communications
EngineeringFacilitiesInformation
Technology
Building
Inspections
Planning and
Zoning
Surface
Water
Sanitary
Sewer
Water
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Term Expires
Joshua Hoyt Mayor December 31, 2024
Holly Bernatz Councilmember December 31, 2026
Nick Lien Councilmember December 31, 2026
Katie Porter Councilmember December 31, 2024
Steve Wilson Councilmember December 31, 2024
Lynn Gorski City Administrator
Julie Flaten Assistant City Administrator/Human Resources Director
Justin Elvestad Fire Chief
Gary Rutherford Police Chief
Kim Sommerland Finance Director
Deanna Kuennen Community Development Director
Kellee Omlid Parks and Recreation Director
John Powell Public Works Director/City Engineer
EXECUTIVE STAFF
ELECTED OFFICIALS
CITY OF FARMINGTON
Elected Officials and Executive Staff
December 31, 2023
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FINANCIAL SECTION
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INDEPENDENT AUDITOR’S REPORT
To the City Council and Management
City of Farmington, Minnesota
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS
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 Farmington,
Minnesota (the City) as of and for the year ended December 31, 2023, 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 m aterial 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, 202 3, and the respective
changes in financial position, and, where applicable, cash flows thereof, and the 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 responsibil ities 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 the financial statements in
accordance with accounting principles generally accepted in the United States of America, and for the
design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
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 12 months beyond the financial statements date, including any currently known
information that may raise substantial doubt shortly thereafter.
(continued)
C E R T I F I E D
A C C O U N T A N T S
P UBLIC
PRINCIPALS
Thomas A. Karnowski, CPA
Paul A. Radosevich, CPA
William J. Lauer, CPA
James H. Eichten, CPA
Aaron J. Nielsen, CPA
Victoria L. Holinka, CPA/CMA
Jaclyn M. Huegel, CPA
Kalen T. Karnowski, CPA
Malloy, Montague, Karnowski, Radosevich & Co., P.A.
5353 Wayzata Boulevard • Suite 410 • Minneapolis, MN 55416 • Phone: 952-545-0424 • Fax: 952-545-0569 • www.mmkr.com
Standard Letterhead-r2.qxp_167639 Letterhead-RV1 9/7/18 6:34 PM Page 1
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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.
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 audi t 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, t he
planned scope and timing of the audit, significant audit findings, and certain internal control related
matters that we identified during the audit.
REQUIRED SUPPLEMENTARY INFORMATION
Accounting principles generally accepted in the United States of Am erica require that the management’s
discussion and analysis and the required supplementary information (RSI), as listed in the table of
contents, be presented to supplement the basic financial statements. Such information is the responsibility
of management and, 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 RSI in accordance with auditing standards generally accepted in the
United States of America, which consisted of inquiries of management about the methods of preparing the
information and comparing the information for consistency with management ’s responses to our
inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic
financial statements. We do not express an opinion or provide any assurance on the information because
the limited procedures do not provide us with sufficient evidence to express an opinion or provide any
assurance.
(continued)
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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 accompanying combining and individual fund
statements and schedules, as listed in the table of contents, are presented for the purpose of additional
analysis and are not a required part of the basic financial statements. Such information is the
responsibility of management and was derived from, and relates directly to, the underlying accounting
and other records used to prepare the basic financial statements. The information has been subjected to
the auditing procedures applied in the audit of the basic financial statements and certain additional
procedures, including comparing and reconciling such information directly to the underlying accounting
and other records used to prepare the basic financial statements or to the basic financial statements
themselves, and other additional procedures in accordance with auditing standards generally accepted in
the United States of America. In our opinion, the supplementary information is 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 included in the annual report. The other information
comprises the introductory and statistical sections, but does not include the basic financial statements and
our auditor’s report thereon. Our opinions on the basic financial statements 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 June 20, 2024,
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, 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 int egral part of
an audit performed in accordance with Government Auditing Standards in considering the City’s internal
control over financial reporting and compliance.
Minneapolis, Minnesota
June 20, 2024
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CITY OF FARMINGTON
Management’s Discussion and Analysis
Year Ended December 31, 2023
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As management of the City of Farmington, 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, 2023. Management’s discussion and analysis (MD&A) is intended to be considered
in conjunction with the additional information that we have furnished in our letter of transmittal, located
earlier in this report, and the City’s financial statements contained within this report.
FINANCIAL HIGHLIGHTS
• The assets and deferred outflows of resources of the City exceeded liabilities and deferred inflows
of resources by $137,275,061 (net position) at the close of the most recent fiscal year. Of this
amount, $38,057,486 (unrestricted net position) may be used to meet the government’s ongoing
obligations to citizens and creditors.
• The City’s total net position increased by $6,405,292 from fiscal 2023 activity, including an
increase of $3,187,232 attributable to governmental activities, and an increase of $3,218,060
attributable to business-type activities.
• The City’s outstanding debt, including bonds and lease liabilities, decreased by $1,284,410, or
10 percent, during the fiscal year, as scheduled debt service principal payments exceeded new
lease liabilities issued during the year.
• The City’s governmental funds reported combined ending fund balances of $28,351,774 on
December 31, 2023, an increase of $2,885,854 from fiscal 2023 activity. Approximately
82 percent of this total, or $23,328,209, is available for use within the City’s constraints and
policies.
• At the end of the current fiscal year, the unassigned fund balance for the General Fund was
$8,987,268, or 48 percent, of 2024 General Fund budgeted expenditures and transfers out.
OVERVIEW OF THE FINANCIAL STATEMENTS
This MD&A is intended to serve as an introduction to the City’s basic financial statements. The City’s
basic financial statements are comprised of three components: 1) government -wide financial statements,
2) fund financial statements, and 3) notes to basic financial statements. This report also contains other
supplementary information in addition to the basic financial statements themselves.
These financial statements include not only the City itself (known as the primary government), but also
the Farmington Economic Development Authority (EDA). The EDA has been presented as a blended
component unit on the City’s financial statements in accordance with accounting principles generally
accepted in the United States of America.
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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, liabilities, and deferred
inflows/outflows, as applicable, 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 personal leave time).
Both of the government-wide financial statements distinguish functions of the City that are principally
supported by taxes and intergovernmental revenues (governmental activities) from other functions that are
intended to recover all or a significant portion of their costs through user fees and charges (business-type
activities). The governmental activities of the City include general government, public safety, public
works, parks and recreation, and economic development. The business-type activities of the City include
liquor operations, and sewer, solid waste, storm water, water, and street light utility operations.
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 two categories: governmental funds and
proprietary 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 the 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 usef ul in evaluating a government’s near-term
financing requirements.
Because the focus of governmental funds is narrower than that of the government -wide financial
statements, it is useful to compare the information presented for governmental funds with similar
information presented for governmental activities in the government -wide financial statements. By doing
so, readers may better understand the long-term impact of the government’s near-term financing
decisions. Both the governmental funds Balance Sheet and 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 funds Balance Sheet and Statement of Revenues, Expenditures, and Changes in Fund
Balances for the City’s five individual major governmental funds. They are as follows:
• General Fund
• Federal Aid Special Revenue Fund
• Private Capital Projects Fund
• Storm Water Trunk Capital Projects Fund
• Closed Bond Debt Service Fund
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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 elsewhere in this report.
The City adopts annual appropriated budgets for its General Fund, most special revenue funds, the Debt
Service Fund (combined), and most capital projects funds. Budgetary comparison statements or
schedules have been provided for these funds to demonstrate compliance with their respective budgets.
Proprietary Funds – The City maintains six enterprise funds and four internal service funds within its
proprietary fund type. Enterprise funds are used to report the same functions presented as business-type
activities in the governmental-wide financial statements. The City uses enterprise funds to account for its
liquor operations, and its sewer, solid waste, storm water, water, and street light utility operations.
Proprietary funds provide the same type of information as the government-wide financial statements,
only in more detail. The proprietary funds financial statements provide separate information for the
enterprise funds, all of which are considered to be major funds of the City.
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 its employee benefits,
property and liability insurance, maintaining its fleet of vehicles, and information technology needs. All
internal service funds are combined into a single, aggregated presentation in the proprietary fund
financial statements, labeled Governmental Activities – Internal Service Funds. Because all of these
services predominately benefit governmental, rather than business-type functions, they have been
included within governmental activities in the government-wide financial statements. Individual fund
data for the internal service funds is provided in the form of combining statements elsewhere in this
report.
Notes to Basic Financial Statements – The notes to basic financial statements provide additional
information that is essential to a full understanding of the data provided in the government-wide and fund
financial statements.
Other Information – In addition to the basic financial statements and accompanying notes, the financial
section also presents required supplementary information, and combining and individual fund statements
and schedules (presented as supplementary information) referred to earlier in connection with nonmajor
governmental funds, internal service funds, budgetary comparison schedules, which are presented
immediately following the basic financial statements.
Furthermore, a statistical section has been included as part of the Annual Comprehensive Financial
Report (ACFR) to facilitate additional analysis, and is the third and final section of the report.
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GOVERNMENT-WIDE FINANCIAL ANALYSIS
An analysis of the City’s financial position begins with a review of the government-wide Statement of
Net Position and the Statement of Activities. These two statements report the City’s net position and
changes in net position. It should be noted that the financial position can also be affected by nonfinancial
factors, including economic conditions, population growth, and new regulations.
As noted earlier, net position may serve over time as a useful indicator of the City’s financial position. As
presented in the following condensed version of the Statement of Net Position, the City’s assets and
deferred outflows of resources exceeded liabilities and deferred inflows of resources by $137,275,061 on
December 31, 2023.
City of Farmington’s Net Position
2023 2022 2023 2022 2023 2022
Current and other assets 40,953,662$ 40,193,291$ 25,002,090$ 21,631,006$ 65,955,752$ 61,824,297$
Capital assets, net 49,003,064 47,611,027 49,830,438 49,866,617 98,833,502 97,477,644
Total assets 89,956,726$ 87,804,318$ 74,832,528$ 71,497,623$ 164,789,254$ 159,301,941$
Deferred outflows of resources 8,239,235$ 9,527,443$ 102,195$ 163,687$ 8,341,430$ 9,691,130$
Current liabilities 5,105,522$ 5,373,349$ 684,958$ 411,720$ 5,790,480$ 5,785,069$
Long-term liabilities 20,014,829 29,235,578 1,825,000 2,155,047 21,839,829 31,390,625
Total liabilities 25,120,351$ 34,608,927$ 2,509,958$ 2,566,767$ 27,630,309$ 37,175,694$
Deferred inflows of resources 8,099,929$ 934,385$ 125,385$ 13,223$ 8,225,314$ 947,608$
Net position
Net investment in capital assets 39,137,210$ 37,033,206$ 48,486,110$ 48,353,192$ 87,623,320$ 85,386,398$
Restricted 9,132,767 10,556,611 2,461,488 2,461,488 11,594,255 13,018,099
Unrestricted 16,705,704 14,198,632 21,351,782 18,266,640 38,057,486 32,465,272
Total net position 64,975,681$ 61,788,449$ 72,299,380$ 69,081,320$ 137,275,061$ 130,869,769$
Governmental Activities Business-Type Activities Total
The largest portion of the City’s net position, $87,623,320, or 64 percent, reflects its investment in capital
assets (e.g., land, buildings, machinery, and equipment); less any outstanding related debt used to acquire
those assets. 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.
Restricted net position of $11,594,255 comprised 8 percent of net position at the close of the fiscal year
ended December 31, 2023. These assets are subject to external restrictions on how they may be used.
The balance of unrestricted net position, $38,057,486, or approximately 28 percent, may be used to meet
the City’s ongoing obligations to citizens and creditors. Certain balances within unrestricted net position
may have internally imposed commitments or limitations, which may further limit the purpose for which
such net position may be used.
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CHANGE IN NET POSITION
The following table provides a condensed version of the Statement of Activities for the year ended
December 31, 2023, with comparative totals for the year ended December 31, 2022. The City’s total net
position increased by $6,405,292, or 5 percent, during the current fiscal year.
City of Farmington’s Change in Net Position
2023 2022 2023 2022 2023 2022
Revenues
Charges for services 3,425,186$ 3,678,479$ 13,908,710$ 13,026,908$ 17,333,896$ 16,705,387$
Operating grants and contributions 1,924,255 1,076,883 10,822 30,616 1,935,077 1,107,499
Capital grants and contributions 1,002,806 833,090 – – 1,002,806 833,090
Property taxes 15,284,709 14,463,106 – – 15,284,709 14,463,106
Franchise taxes 201,431 227,017 – – 201,431 227,017
Unrestricted grants 944,364 207,501 – – 944,364 207,501
Investment earnings (charges)1,407,087 (874,200) 913,579 (525,811) 2,320,666 (1,400,011)
Gain on disposal of capital assets 136,368 81,008 – – 136,368 81,008
Total revenues 24,326,206 19,692,884 14,833,111 12,531,713 39,159,317 32,224,597
Expenses
General government 5,200,453 3,626,853 – – 5,200,453 3,626,853
Public safety 8,712,115 7,936,364 – – 8,712,115 7,936,364
Public works 3,806,386 5,333,328 – – 3,806,386 5,333,328
Parks and recreation 2,583,554 2,522,085 – – 2,583,554 2,522,085
Economic development 177,927 247,970 – – 177,927 247,970
Interest and fiscal charges 239,992 288,751 – – 239,992 288,751
Liquor operations – – 6,256,081 5,977,403 6,256,081 5,977,403
Sewer – – 2,872,236 2,606,288 2,872,236 2,606,288
Solid waste – – 76,270 87,359 76,270 87,359
Storm water – – 725,039 719,225 725,039 719,225
Water – – 1,889,215 1,814,354 1,889,215 1,814,354
Street light – – 214,757 210,174 214,757 210,174
Total expenses 20,720,427 19,955,351 12,033,598 11,414,803 32,754,025 31,370,154
Change in net position before transfers 3,605,779 (262,467) 2,799,513 1,116,910 6,405,292 854,443
Transfers (418,547) 3,393,908 418,547 (3,393,908) – –
Change in net position 3,187,232 3,131,441 3,218,060 (2,276,998) 6,405,292 854,443
Net position – beginning 61,788,449 72,703,910 69,081,320 137,275,061 130,869,769 209,978,971
Net position – ending 64,975,681$ 61,788,449$ 72,299,380$ 69,081,320$ 137,275,061$ 130,869,769$
Governmental Activities Business-Type Activities Total
Governmental Activities – Governmental activities increased the City’s net position by $3,187,232. An
increase in the approved property tax levy, more federal grant entitlements used, new state funding for
public safety, and improvement in investment earnings (charges) from improved interest rates and market
conditions contributed to a $4,633,322 increase in total governmental activities revenues compared to the
previous year. Governmental activities expenses increased $765,076 from the previous year with the
increase mainly in the general government and public safety functions. Increased grant spending,
contractual salary increases, and inflationary increases to employee benefits, utilities, supplies, and other
purchased services contributed to the overall increase. Public works expenses decreased, due to a greater
proportion of street improvement projects being capitalized in the current year, including $2,284,363 of
capitalized utility infrastructure contributed to the business-type activities.
Business-Type Activities – Business-type activities increased the City’s net position by $3,218,060. An
increase in liquor operation gross sales, utility rate increases, and improved investment earnings (charges)
contributed to a $2,301,398 increase in total business-type activities revenues compared to the previous
year. Increases in liquor cost of goods sold and sewer disposal charges were the largest factors in a
$618,795 increase in total business-type activities expenses. The City has been in the process of
transitioning its solid waste and recycling collection operation to a private contractor the last two years,
greatly reducing the activity reported in that function compared to prior years. It is anticipated that
operations will be fully discontinued, and the related enterprise fund closed in fiscal 2024.
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GOVERNMENTAL ACTIVITIES
Revenues – The following chart illustrates the City’s revenues by source for its governmental activities:
Revenues by Source – Governmental Activities
Expenses – The following chart illustrates the City’s governmental expenses and corresponding program
revenues, excluding transfers, for its governmental activities:
Expenses and Program Revenues – Governmental Activities
General
Government Public Safety Public Works Parks and
Recreation
Economic
Development
Interest and
Fiscal Charges
Program Revenues $1,092,271 $2,186,491 $2,210,628 $829,953 $32,904 $–
Expenses $5,200,453 $8,712,115 $3,806,386 $2,583,554 $177,927 $239,992
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
$4,500,000
$5,000,000
$5,500,000
$6,000,000
$6,500,000
$7,000,000
$7,500,000
$8,000,000
$8,500,000
$9,000,000
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BUSINESS-TYPE ACTIVITIES
Revenues – The following chart illustrates the City’s revenues by source for its business-type activities:
Revenues by Source – Business-Type Activities
Expenses – Below is a graph showing the City’s expenses and program revenues, excluding transfers, for
its business-type activities:
Expenses and Program Revenues – Business-Type Activities
Liquor
Operations Sewer Solid Waste Storm Water Water Street Light
Program Revenues $6,770,085 $2,762,566 $14,693 $1,327,620 $2,805,763 $238,805
Expenses $6,256,081 $2,872,236 $76,270 $725,039 $1,889,215 $214,757
$–
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
$4,500,000
$5,000,000
$5,500,000
$6,000,000
$6,500,000
$7,000,000
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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 currently available 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.
As of the end of the current fiscal year, the City’s governmental funds reported combined ending fund
balances of $28,351,774, an 11 percent increase of $2,885,854 from 2023 activity. The increase is mainly
attributable to resources accumulated for public safety programs, trunk fees, and positive operating results
in the General Fund.
Committed, assigned, and unassigned fund balances, which are available for spending at the City’s
discretion, had a combined balance of $23,328,209 at year-end. The remainder of the fund balance is
either not available for new spending, or available for new spending but limited in use, because it is either
nonspendable for prepaids ($15,883); or restricted: 1) to pay debt service ($2,100,445), 2) for economic
development ($374,938), 3) for various public safety programs ($1,099,845), 4) for park or recreational
capital improvements ($1,220,794), or 5) to pay for future cable communication expenditures ($211,660).
Financial highlights for the City’s major governmental funds are as follows:
General Fund – The General Fund is the chief operating fund of the City. At the end of 20 23, the
unassigned fund balance of the General Fund was $8,987,268. As a measure of the General Fund’s
liquidity, it may be useful to compare the fund balance to total fund expenditures. The
2023 unassigned fund balance represents approximately 48 percent of total 2024 General Fund
budgeted expenditures and transfers out.
The ratio of the General Fund’s unassigned fund balance to the subsequent years’ budgeted
expenditures and transfers out has increased steadily from 21 percent as of December 31, 2011 to
48 percent as of December 31, 2023. The City Council has increased its commitment to not only
sound, comprehensive budgets, but also long-term financial planning. In addition, the City has
benefitted from community growth and tight budgetary control of expenditures, which have
contributed to the strengthening of the General Fund’s balance over that period.
The City Council also recently revised the City’s fund balance policy and stated it would strive to
maintain the fund balance in the General Fund between 40–50 percent of the subsequent year’s
budgeted expenditures and transfers out in order to provide enough funding to carry city operations to
the next semiannual receipt of tax proceeds (in June/July). As of December 31, 2023, the City’s
General Fund balance meets the minimum fund balance guideline.
Total fund balances increased by $1,156,920 in the General Fund during the 2023 fiscal year. Higher
than anticipated revenues from intergovernmental sources, charges for services , and investment
earnings; along with expenditures being held under budget in total, contributed to this increase.
Federal Aid Special Revenue Fund – The increase of $75,255 in fund balance was due to allocated
investment earnings in 2023. The City utilized $942,029 of available federal funding for various
projects during the year.
Private Capital Projects Fund – There were no significant projects in this fund during 2023. The
increase in fund balance of $83,525 was due to allocated investment earnings in 2023.
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Storm Water Trunk Capital Projects Fund – The increase of $664,310 in fund balance was due to
revenues from property taxes, trunk fees, and allocated investment earnings exceeding expenditures
in 2023.
Closed Bond Debt Service Fund – The City established this fund in 2023 with transfers of
$1,046,942 to account for accumulated resources related to bond issues that fully matured or were
called by the City using internal resources in prior years. Additional revenues of $551,082 brought the
fund balance up to $1,598,024 at year-end, which the City has assigned for future debt service.
Total fund balances in the City’s nonmajor governmental funds decreased $692,180 in fiscal 2023, to a
year-end total of $12,278,527. Financial highlights for some of the significant changes in the City’s
nonmajor governmental funds are as follows:
Public Safety Special Revenue Fund – The increase in fund balance of $1,035,106 was due to a
one-time state public safety grant received during the year.
Water Trunk Capital Projects Fund – Revenues from charges for services and investment earnings
resulted in a net increase in fund balance of $492,518, as there were no projects in this fund in 2023.
Spruce Street Reconstruction Capital Projects Fund – The decrease in fund balance of $1,921,952
resulted from project costs exceeding revenue in 2023.
Maintenance Capital Projects Fund – The increase in fund balance of $568,492 was due to
transfers in exceeding the planned project costs incurred by year-end.
Capital Projects Reserve Capital Projects Fund – The increase of $316,234 in fund balance is due
to transfers from the State Aid Construction and Permanent Improvement Revolving Capital Projects
Funds to establish this new fund.
Debt Service Fund – The decrease of $1,054,504 in fund balance is due to transfers of $1,046,942 to
eliminate several closed bond accounts and establish the Closed Bond Debt Service Fund.
Proprietary Funds – The City’s proprietary funds provide the same type of information found in the
government-wide financial statements, but in more detail. Financial highlights for the significant changes
in the City’s proprietary funds are as follows:
Liquor Operations Fund – Each year the City reviews the financial performance of its liquor
operations. After setting aside a certain amount of funds for operations and administrative transfers,
the remaining funds on hand are allocated to community investment and future capital improvements.
Liquor operations produced income before transfers of $604,140, an increase of $232,507 from the
prior year, mainly due to increased sales and investment earnings. The net position of the Liquor
Operations Fund at the end of 2023 totaled $2,444,814, an increase of $409,014. The cash position for
both stores increased from $1,636,290 on December 31, 2022 to $2,352,268 as of December 31,
2023.
Sewer Operations Fund – The current year increase in net position of $273,493 is primarily due to
capital infrastructure asset contributions of $629,637 received from governmental fund activities
during the year. An increase of approximately 6 percent in charges for services, due mainly to a rate
increase, was more than offset by a 10 percent increase in operating expenses. The City has
implemented a series of rate increases designed to provide sufficient funds to cover both operations
and depreciation. This fund continues to maintain a significant unrestricted net position of
$3,507,824.
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Solid Waste Fund – The Solid Waste Fund net position decreased by $407,578, mainly due to
transfers out related to the continued process of closing the fund. It is anticipated that operations will
be completely discontinued, and the fund closed in fiscal 2024.
Storm Water Fund – The increase in net position of $1,157,016 is primarily due charges for services
being sufficient to cover operating expenses, resulting in operating income of $651,397 for the year.
This fund also received capital infrastructure asset contributions of $868,749 received from
governmental fund activities during the year. This fund continues to maintain a significant
unrestricted net position of $3,232,777.
Water Fund – The increase in net position of $1,746,337 is primarily due to charges for services
being sufficient to cover depreciation expense, improved investment earnings, and capital
infrastructure asset contributions of $785,977 received from governmental fund activities during the
year. This fund continues to maintain a significant unrestricted net position of $10,517,451.
Street Light Fund – The Street Light Fund was established in 2010. By making this a utility fund, all
properties within the City, including tax-exempt properties, pay for street lighting. This fund has
achieved a modest positive net position of $383,773 at year-end, an increase of $39,778 from last
year.
GENERAL FUND BUDGETARY HIGHLIGHTS
The City’s original and final budgets are the same, as no budget amendments were made during the year.
Actual revenues were $812,619 over budget. Revenue variances from final budget to actual include:
• Intergovernmental revenue was $228,849 over budget, mainly due to street maintenance, training
reimbursements, and other miscellaneous grants exceeding budget.
• Charges for services were $233,175 more than the City’s conservative budget, with higher than
expected charges for fire service and engineering.
• Investment earnings were $312,980 over budget, due to higher interest rates and improvements in
the fair values of the City’s investment portfolio. As the City generally intends to hold
investments to maturity, it is anticipated that this temporary market gain will fluctuate before the
investments mature.
Expenditures were $336,073 less than the budgeted amount, mainly in the public safety and public works
areas. The City experienced lower salaries and benefits costs partially attributable to continuing
challenges in filling vacant positions.
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CAPITAL ASSETS AND LONG-TERM DEBT
Capital Assets – The City’s investment in capital assets for its governmental and business-type activities
as of December 31, 2023, was $98,833,502 (net of accumulated depreciation/amortization). This
investment in capital assets includes land, buildings, improvements other than buildings, park facilities,
machinery and equipment, vehicles, roads, bridges, infrastructure, intangibles, water mains, water
reservoirs, sewer mains, lift stations, and storm water mains. The City’s investment in capital assets for
the current fiscal year increased by 1 percent, mainly due to capitalized street and utility infrastructure
and lease asset additions, offset by current year depreciation/amortization.
City of Farmington’s Capital Assets
2023 2022 2023 2022 2023 2022
Land and easements 1,658,302$ 1,658,302$ 498,376$ 498,376$ 2,156,678$ 2,156,678$
Construction in progress 554,953 2,574,042 – – 554,953 2,574,042
Buildings 12,863,478 13,297,011 1,128,499 1,333,629 13,991,977 14,630,640
Improvements other than buildings 824,468 295,150 1,392,088 1,497,899 2,216,556 1,793,049
Machinery and equipment 3,626,858 3,899,180 510,021 632,716 4,136,879 4,531,896
Infrastructure 28,762,779 25,798,272 – – 28,762,779 25,798,272
Collection/distribution systems – – 45,526,648 45,008,564 45,526,648 45,008,564
Leases – vehicles 712,226 89,070 – – 712,226 89,070
Leases – buildings – – 774,806 895,433 774,806 895,433
Total (net of depreciation)49,003,064$ 47,611,027$ 49,830,438$ 49,866,617$ 98,833,502$ 97,477,644$
Governmental Activities Business-Type Activities Total
Additional information on the City’s capital assets can be found in Note 5 of the notes to basic financial
statements.
Long-Term Debt – At the end of the current fiscal year, the City had total debt (bonds and lease
liabilities) outstanding of $11,700,414. All City bonded debt is general obligation debt, which is backed
by the full faith and credit of the government. Furthermore, at year-end, the City has long-term liabilities
of $1,097,977 for compensated absences, $7,948,615 for net pension liabilities, and $1,092,823 for other
post-employment benefits.
City of Farmington’s Outstanding Long-Term Debt
2023 2022 2023 2022 2023 2022
General obligation improvement bonds 5,435,000$ 6,305,000$ –$ –$ 5,435,000$ 6,305,000$
Capital improvement bonds 2,965,000 3,510,000 – – 2,965,000 3,510,000
Equipment certificates 695,000 905,000 – – 695,000 905,000
General obligation revenue bonds – – 465,000 530,000 465,000 530,000
Unamortized premiums 544,915 668,370 51,207 61,120 596,122 729,490
Lease liabilities 716,171 83,029 828,121 922,305 1,544,292 1,005,334
Total debt outstanding 10,356,086$ 11,471,399$ 1,344,328$ 1,513,425$ 11,700,414$ 12,984,824$
Governmental Activities Business-Type Activities Total
Bond principal repayments during 2023 totaled $1,690,000. The only new debt issued by the City in 2023
was $714,239 of new vehicle leases. The City’s credit rating from Standard & Poor’s was raised from
“AA” to “AA+” in April 2019, which was affirmed in 2023.
Minnesota Statutes limit the amount of general obligation debt a Minnesota city may issue to 3 percent of
total estimated market value. The current debt limitation for the City is $86,808,834, which is
significantly more than the City’s outstanding general obligation debt. Additional information on the
City’s long-term debt may be found in Note 6 of the notes to basic financial statements.
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ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS AND RATES
The City increased its General Fund net operating levy in 2024 by $1,415,404. The final city total net tax
levy for 2024 of $14,008,798 is 9.9 percent higher than the comparable 2023 levy. Of the total General
Fund budgeted revenues, including transfers in for 2024, 75.2 percent are from property taxes, including
$2.1 million in fiscal disparities revenue. The remaining General Fund budgeted revenues were adjusted
to reflect forecasted building activity and an anticipated increase in intergovernmental revenues and
charges for service.
Proposed 2024 General Fund expenditures, including transfers out, are estimated at $18,884,407, an
increase of 11.8 percent compared to the 2023 budget. The 2024 budget maintains funding for core
services—police and fire protection, street maintenance and snow removal, parks and recreation, and
administration; and continues long-term funding for the City’s seal coating, trail maintenance, building
maintenance, and police and fire equipment. The City’s Capital Improvement Plan provides for the
continued replacement of police vehicles and public safety equipment in 2024.
The City steadfastly upholds its commitment to four key priorities: business growth, community
engagement, infrastructure support, and employee engagement. The City remains dedicated to delivering
top-tier essential services to its existing residents and also actively promoting the City, aiming to attract
and bolster new development, thereby broadening the tax base and ensuring the City’s prosperity.
REQUESTS FOR INFORMATION
This ACFR is designed to provide a general overview of the City’s finances for all those with an interest
in the government’s finances. Questions concerning any of the information provided in this report, or
requests for additional financial information, should be addressed to the Finance Director at the
City of Farmington, 430 Third Street, Farmington, Minnesota 55024. Email requests can be sent to
ksommerland@farmingtonmn.gov.
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BASIC FINANCIAL STATEMENTS
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Governmental Business-Type
Activities Activities Total
Assets
Cash and investments 34,137,550$ 20,044,781$ 54,182,331$
Receivables
Accounts 484,009 1,476,483 1,960,492
Interest 143,403 92,748 236,151
Property taxes 1,311,184 – 1,311,184
Special assessments 2,750,016 270,924 3,020,940
Due from other governments 469,403 1,195 470,598
Lease 101,536 – 101,536
Inventory – 654,431 654,431
Prepaid items 20,008 40 20,048
Restricted assets – temporarily restricted
Cash for future drinking water treatment plant – 2,461,488 2,461,488
Net pension asset – fire relief 1,536,553 – 1,536,553
Capital assets
Not depreciated/amortized 2,213,255 498,376 2,711,631
Depreciated/amortized, net 46,789,809 49,332,062 96,121,871
Total capital assets, net 49,003,064 49,830,438 98,833,502
Total assets 89,956,726 74,832,528 164,789,254
Deferred outflows of resources
Pension plan deferments – PERA 7,354,712 100,096 7,454,808
Pension plan deferments – fire relief 851,277 – 851,277
OPEB plan deferments 33,246 2,099 35,345
Total deferred outflows of resources 8,239,235 102,195 8,341,430
Total assets and deferred outflows of resources 98,195,961$ 74,934,723$ 173,130,684$
Liabilities
Accounts and contracts payable 1,297,053$ 440,851$ 1,737,904$
Accrued salaries and employee benefits payable 227,489 – 227,489
Accrued interest payable 133,685 8,950 142,635
Deposits payable 1,964,564 88,585 2,053,149
Due to other governments 686 146,572 147,258
Unearned revenue 1,482,045 – 1,482,045
Long-term liabilities
Due within one year
Bonds, certificates, lease liabilities, and compensated absences 2,481,143 204,669 2,685,812
Total OPEB liability 75,600 – 75,600
Due in more than one year
Bonds, certificates, lease liabilities, and compensated absences 8,927,904 1,184,675 10,112,579
Net pension liability 7,577,873 370,742 7,948,615
Total OPEB liability 952,309 64,914 1,017,223
Total long-term liabilities 20,014,829 1,825,000 21,839,829
Total liabilities 25,120,351 2,509,958 27,630,309
Deferred inflows of resources
Pension plan deferments – PERA 7,330,959 125,385 7,456,344
Pension plan deferments – fire relief 667,434 – 667,434
Lease revenue for subsequent years 101,536 – 101,536
Total deferred inflows of resources 8,099,929 125,385 8,225,314
Net position
Net investment in capital assets 39,137,210 48,486,110 87,623,320
Restricted for
Debt service 4,294,767 – 4,294,767
Economic development 374,938 – 374,938
Public safety programs 1,099,845 – 1,099,845
Park improvements 1,100,850 – 1,100,850
Capital projects 331,604 – 331,604
State-funded street projects 394,210 – 394,210
Fire relief pensions 1,536,553 – 1,536,553
Water Fund – future drinking water treatment plant – 2,461,488 2,461,488
Unrestricted 16,705,704 21,351,782 38,057,486
Total net position 64,975,681 72,299,380 137,275,061
Total liabilities, deferred inflows of resources, and net position 98,195,961$ 74,934,723$ 173,130,684$
CITY OF FARMINGTON
Statement of Net Position
as of December 31, 2023
See notes to basic financial statements -16-
Page 147 of 352
Program Revenues
Operating Capital
Charges for Grants and Grants and
Functions/Programs Expenses Services Contributions Contributions
Primary government
Governmental activities
General government 5,200,453$ 1,048,415$ 43,845$ 11$
Public safety 8,712,115 581,869 1,574,372 30,250
Public works 3,806,386 965,032 273,051 972,545
Parks and recreation 2,583,554 829,870 83 –
Economic development 177,927 – 32,904 –
Interest and fiscal charges 239,992 – – –
Total governmental activities 20,720,427 3,425,186 1,924,255 1,002,806
Business-type activities
Liquor operations 6,256,081 6,770,039 46 –
Sewer 2,872,236 2,762,566 – –
Solid waste 76,270 10,605 4,088 –
Storm water 725,039 1,327,620 – –
Water 1,889,215 2,799,075 6,688 –
Street light 214,757 238,805 – –
Total business-type activities 12,033,598 13,908,710 10,822 –
Total government 32,754,025$ 17,333,896$ 1,935,077$ 1,002,806$
General revenues
Property taxes
Franchise taxes
Grants and contributions not restricted
to specific programs
Investment earnings
Gain on sale of capital assets
Transfers
Total general revenues and transfers
Change in net position
Net position – beginning
Net position – ending
CITY OF FARMINGTON
Statement of Activities
Year Ended December 31, 2023
See notes to basic financial statements -17-
Page 148 of 352
Governmental Business-Type
Activities Activities Total
(4,108,182)$ –$ (4,108,182)$
(6,525,624) – (6,525,624)
(1,595,758) – (1,595,758)
(1,753,601) – (1,753,601)
(145,023) – (145,023)
(239,992) – (239,992)
(14,368,180) – (14,368,180)
– 514,004 514,004
– (109,670) (109,670)
– (61,577) (61,577)
– 602,581 602,581
– 916,548 916,548
– 24,048 24,048
– 1,885,934 1,885,934
(14,368,180) 1,885,934 (12,482,246)
15,284,709 – 15,284,709
201,431 – 201,431
944,364 – 944,364
1,407,087 913,579 2,320,666
136,368 – 136,368
(418,547) 418,547 –
17,555,412 1,332,126 18,887,538
3,187,232 3,218,060 6,405,292
61,788,449 69,081,320 130,869,769
64,975,681$ 72,299,380$ 137,275,061$
Changes in Net Position
Net (Expense) Revenue and
-18-
Page 149 of 352
Special
Revenue –Capital
Federal Projects –
General Aid Private
Assets
Cash and investments 7,798,138$ 1,467,069$ 2,022,941$
Receivables
Accounts 286,129 – 14,202
Interest 40,781 6,053 8,347
Property taxes
Unremitted 1,160,672 – –
Delinquent 150,512 – –
Special assessments
Delinquent 261 – –
Noncurrent 970 – –
Due from other funds 2,691 – –
Due from other governments 36,674 – –
Lease 101,536 – –
Prepaid items 1,169 14,714 –
Total assets 9,579,533$ 1,487,836$ 2,045,490$
Liabilities
Accounts and contracts payable 307,734$ 13,037$ –$
Deposits payable 29,941 – 1,919,665
Due to other governments 142 – –
Due to other funds – – –
Unearned revenue – 1,482,045 –
Total liabilities 337,817 1,495,082 1,919,665
Deferred inflows of resources
Unavailable revenue – property taxes 150,512 – –
Unavailable revenue – special assessments 1,231 – –
Unavailable revenue – long-term receivable – – –
Lease revenue for subsequent years 101,536 – –
Total deferred inflows of resources 253,279 – –
Fund balances (deficits)
Nonspendable 1,169 14,714 –
Restricted – – –
Committed – – 125,825
Assigned – – –
Unassigned 8,987,268 (21,960) –
Total fund balances (deficits)8,988,437 (7,246) 125,825
Total liabilities, deferred inflows
of resources, and fund balances 9,579,533$ 1,487,836$ 2,045,490$
CITY OF FARMINGTON
Balance Sheet
Governmental Funds
as of December 31, 2023
See notes to basic financial statements -19-
Page 150 of 352
Capital
Projects –Debt
Storm Water Service –
Trunk Closed Bond Nonmajor Total
5,346,147$ 1,591,457$ 12,930,520$ 31,156,272$
– – 183,678 484,009
22,060 6,567 47,294 131,102
– – – 1,160,672
– – – 150,512
– 2,496 – 2,757
– 2,325,511 420,778 2,747,259
– – 35,379 38,070
– – 416,867 453,541
– – – 101,536
– – – 15,883
5,368,207$ 3,926,031$ 14,034,516$ 36,441,613$
–$ –$ 890,149$ 1,210,920$
– – 12,238 1,961,844
– – 544 686
– – 38,070 38,070
– – – 1,482,045
– – 941,001 4,693,565
– – – 150,512
– 2,328,007 420,778 2,750,016
– – 394,210 394,210
– – – 101,536
– 2,328,007 814,988 3,396,274
– – – 15,883
– – 5,007,682 5,007,682
5,368,207 – 7,696,991 13,191,023
– 1,598,024 – 1,598,024
– – (426,146) 8,539,162
5,368,207 1,598,024 12,278,527 28,351,774
5,368,207$ 3,926,031$ 14,034,516$ 36,441,613$
-20-
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Page 152 of 352
28,351,774$
Capital assets used in governmental activities are not financial resources and,therefore,are not
reported in governmental funds.
Cost of capital assets 98,970,379
Less accumulated depreciation/amortization (49,970,064)
Net pension assets are only recorded in the government-wide financial statements as they are not
current financial resources to governmental funds.1,536,553
Long-term liabilities are not payable with current financial resources and,therefore,are not reported
in governmental funds.
Bonds (9,095,000)
Unamortized bond premiums (544,915)
Lease liability (716,171)
Compensated absences (1,001,179)
Net pension liability (7,577,873)
Total OPEB liability (1,027,909)
Interest on long-term debt is included in the change in net position as it accrues,regardless of when
payment is due. However, it is included in the change in fund balances when due.(133,685)
Internal service funds are used by management to charge certain costs to individual funds.The assets
and liabilities of the internal service funds are included in governmental activities in the Statement of
Net Position.2,648,191
Due to availability,certain revenues are not recognized under the governmental fund statements until
received;however,under full accrual in the government-wide Statement of Activities,revenues are
recorded when earned regardless of when received.
Delinquent property taxes 150,512
Delinquent and deferred special assessments 2,750,016
Long-term receivables 394,210
Governmental funds do not report certain long-term amounts related to pensions that are included in
net position.
Deferred outflows of resources – pension plan deferments 8,205,989
Deferred outflows of resources – OPEB plan deferments 33,246
Deferred inflows of resources – pension plan deferments (7,998,393)
Total net position – governmental activities 64,975,681$
Amounts reported for governmental activities in the Statement of Net Position are different because:
as of December 31, 2023
CITY OF FARMINGTON
Reconciliation of the Balance Sheet to the
Statement of Net Position
Governmental Funds
Total fund balances – governmental funds
See notes to basic financial statements -21-
Page 153 of 352
Special
Revenue –Capital
Federal Projects –
General Aid Private
Revenues
Property taxes 13,070,482$ –$ –$
Franchise taxes 145,000 – –
Special assessments 2,474 – –
Licenses and permits 927,731 – –
Intergovernmental 852,169 942,028 –
Charges for services 694,094 – –
Fines and forfeits 57,509 – –
Investment earnings 363,980 75,256 83,525
Other 86,229 – –
Total revenues 16,199,668 1,017,284 83,525
Expenditures
Current
General government 3,122,528 942,029 –
Public safety 7,112,803 – –
Public works 3,019,828 – –
Parks and recreation 1,600,767 – –
Economic development – – –
Capital outlay
General government 4,800 – –
Public safety 8,461 – –
Public works 14,104 – –
Parks and recreation 23,397 – –
Debt service
Principal – – –
Interest and fiscal charges – – –
Total expenditures 14,906,688 942,029 –
Excess (deficiency) of revenues over expenditures 1,292,980 75,255 83,525
Other financing sources (uses)
Sale of capital assets 8,228 – –
Leases issued – – –
Transfers in 1,497,734 – –
Transfers out (1,642,022)– –
Total other financing sources (uses)(136,060) – –
Net change in fund balances 1,156,920 75,255 83,525
Fund balances (deficits)
Beginning of year 7,831,517 (82,501) 42,300
End of year 8,988,437$ (7,246)$ 125,825$
Year Ended December 31, 2023
Governmental Funds
Statement of Revenues, Expenditures, and Changes in Fund Balances
CITY OF FARMINGTON
See notes to basic financial statements -22-
Page 154 of 352
Capital
Projects –Debt
Storm Water Service –
Trunk Closed Bond Nonmajor Total
166,000$ –$ 2,014,520$ 15,251,002$
– – 56,431 201,431
– 500,114 17,528 520,116
– – – 927,731
– – 3,149,671 4,943,868
277,962 – 1,059,645 2,031,701
– – – 57,509
228,231 50,968 476,025 1,277,985
– – 351,296 437,525
672,193 551,082 7,125,116 25,648,868
– – 119,761 4,184,318
– – 94,124 7,206,927
– – 846,936 3,866,764
– – 643,223 2,243,990
– – 177,927 177,927
– – – 4,800
– – 1,207,977 1,216,438
– – 4,168,592 4,182,696
– – 234,520 257,917
– – 1,706,097 1,706,097
7,883 – 388,658 396,541
7,883 – 9,587,815 25,444,415
664,310 551,082 (2,462,699) 204,453
– – 128,140 136,368
– – 714,239 714,239
– 1,046,942 2,398,528 4,943,204
– – (1,470,388) (3,112,410)
– 1,046,942 1,770,519 2,681,401
664,310 1,598,024 (692,180) 2,885,854
4,703,897 – 12,970,707 25,465,920
5,368,207$ 1,598,024$ 12,278,527$ 28,351,774$
-23-
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Page 156 of 352
2,885,854$
Governmental funds report capital outlays as expenditures.However,in the Statement of Activities,the cost of those
assets is allocated over their estimated useful lives and reported as depreciation/amortization expense.
Capital outlay 6,195,552
Transfer of capital assets to business-type activities (2,284,363)
Depreciation/amortization expense (2,514,665)
A gain or loss on the disposal of capital assets,including the difference between the carrying value and any related
sale proceeds,is included in the change in net position.However,only the sale proceeds are included in the change
in fund balances. (3,387)
Net pension assets are included in net position,but are excluded from fund balances because they do not represent
financial resources. (177,552)
The issuance of long-term debt provides current financial resources to governmental funds,while the repayment of
long-term debt consumes the current financial resources of governmental funds.Neither transaction,however,has
any effect on net position.Other long-term adjustments are also made between the governmental funds and the
Statement of Activities for debt premiums, compensated absences, pension liabilities, and OPEB obligations.
Debt issued (714,239)
Principal payments for debt 1,706,097
Debt premiums 123,455
Compensated absences 84,081
Net pension liability 7,863,986
Total OPEB liability 160,046
Interest on long-term debt in the Statement of Activities differs from the amount reported in the governmental funds
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.33,094
Internal service funds are used by management to charge certain costs to individual funds.The net revenue of certain
activities of internal service funds is reported with governmental activities in the government-wide financial
statements.(126,791)
Certain revenues included in net position as soon as they are earned are not included in the change in fund balances
until available to liquidate liabilities of the current period.
Delinquent property taxes 33,707
Delinquent and deferred special assessments (371,134)
Long-term receivable (1,239,117)
Governmental funds do not report additions or deletions to certain long-term amounts related to pensions that are
included in the change in net position.
Deferred outflows of resources – pension plan deferments (1,261,127)
Deferred outflows of resources – OPEB plan deferments (27,081)
Deferred inflows of resources – pension plan deferments (7,179,184)
Change in net position – governmental activities 3,187,232$
CITY OF FARMINGTON
Year Ended December 31, 2023
Governmental Funds
to the Statement of Activities
Amounts reported for governmental activities in the Statement of Activities are different because:
Total net change in fund balances – governmental funds
Revenues, Expenditures, and Changes in Fund Balances
Reconciliation of the Statement of
See notes to basic financial statements -24-
Page 157 of 352
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Page 158 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Property taxes 13,087,930$ 13,070,482$ (17,448)$
Franchise taxes 145,000 145,000 –
Special assessments – 2,474 2,474
Licenses and permits 915,470 927,731 12,261
Intergovernmental 623,320 852,169 228,849
Charges for services 460,919 694,094 233,175
Fines and forfeits 55,000 57,509 2,509
Investment earnings 51,000 363,980 312,980
Other 48,410 86,229 37,819
Total revenues 15,387,049 16,199,668 812,619
Expenditures
Current
General government 3,007,352 3,122,528 115,176
Public safety 7,386,575 7,112,803 (273,772)
Public works 3,213,039 3,019,828 (193,211)
Parks and recreation 1,581,264 1,600,767 19,503
Capital outlay
General government 2,000 4,800 2,800
Public safety 20,000 8,461 (11,539)
Public works 3,300 14,104 10,804
Parks and recreation 29,231 23,397 (5,834)
Total expenditures 15,242,761 14,906,688 (336,073)
Excess of revenues over expenditures 144,288 1,292,980 1,148,692
Other financing sources (uses)
Sale of capital assets – 8,228 8,228
Transfers in 1,497,734 1,497,734 –
Transfers out (1,642,022)(1,642,022) –
Total other financing sources (uses)(144,288) (136,060) 8,228
Net change in fund balances –$ 1,156,920 1,156,920$
Fund balances
Beginning of year 7,831,517
End of year 8,988,437$
CITY OF FARMINGTON
Year Ended December 31, 2023
General Fund
Statement of Revenues, Expenditures, and Changes in Fund Balances
Budget and Actual
See notes to basic financial statements -25-
Page 159 of 352
Liquor Sewer Solid Storm
Operations Operations Waste Water
Assets
Current assets
Cash and investments 2,352,268$ 2,726,259$ 1,458,338$ 2,945,877$
Cash restricted for drinking water treatment plant – – – –
Receivables
Accounts 90,958 600,194 734 287,957
Interest 9,691 11,249 6,017 12,155
Delinquent special assessments – 15,271 – –
Deferred special assessments – 255,653 – –
Due from other governments – – – –
Inventory 654,431 – – –
Prepaid items 40 – – –
Total current assets 3,107,388 3,608,626 1,465,089 3,245,989
Noncurrent assets
Capital assets
Land – 85,000 – 84,992
Buildings – – – –
Improvements other than buildings 358,276 – – –
Machinery and equipment 303,945 999,791 – 433,883
Distribution system – – – –
Collection system – 29,713,301 – 21,721,102
Leases – buildings 951,551 – – –
Less accumulated depreciation/amortization (585,705) (15,355,113) – (9,559,932)
Total capital assets (net of accumulated depreciation/amortization)1,028,067 15,442,979 – 12,680,045
Total assets 4,135,455 19,051,605 1,465,089 15,926,034
Deferred outflows of resources
Pension plan deferments – PERA 100,096 – – –
OPEB plan deferments 2,099 – – –
Total deferred outflows of resources 102,195 – – –
Total assets and deferred outflows of resources 4,237,650$ 19,051,605$ 1,465,089$ 15,926,034$
Liabilities
Current liabilities
Accounts and contracts payable 289,817$ 26,252$ –$ 13,212$
Accrued salaries and employee benefits payable – – – –
Deposits payable – – – –
Due to other governments 68,841 74,550 – –
Accrued interest payable – – – –
Compensated absences payable – current 33,762 – – –
Bonds payable – current – – – –
Lease liability – current 100,907 – – –
Total current liabilities 493,327 100,802 – 13,212
Noncurrent liabilities
Compensated absences payable 11,254 – – –
Bonds payable (net of unamortized premiums)– – – –
Lease liability 727,214 – – –
Net pension liability – PERA 370,742 – – –
Total OPEB liability 64,914 – – –
Total noncurrent liabilities 1,174,124 – – –
Total liabilities 1,667,451 100,802 – 13,212
Deferred inflows of resources
Pension plan deferments – PERA 125,385 – – –
Net position
Net investment in capital assets 199,946 15,442,979 – 12,680,045
Restricted for drinking water treatment plant – – – –
Unrestricted 2,244,868 3,507,824 1,465,089 3,232,777
Total net position 2,444,814 18,950,803 1,465,089 15,912,822
Total liabilities, deferred inflows of resources, and net position 4,237,650$ 19,051,605$ 1,465,089$ 15,926,034$
as of December 31, 2023
Business-Type Activities – Enterprise Funds
CITY OF FARMINGTON
Statement of Net Position
Proprietary Funds
See notes to basic financial statements -26-
Page 160 of 352
Governmental
Street Activities –
Water Light Total Internal Service
10,180,637$ 381,402$ 20,044,781$ 2,981,278$
2,461,488 – 2,461,488 –
462,446 34,194 1,476,483 –
52,062 1,574 92,748 12,301
– – 15,271 –
– – 255,653 –
1,195 – 1,195 15,862
– – 654,431 –
– – 40 4,125
13,157,828 417,170 25,002,090 3,013,566
328,384 – 498,376 –
5,290,137 – 5,290,137 –
1,534,818 – 1,893,094 –
567,340 – 2,304,959 99,124
34,072,870 – 34,072,870 –
– – 51,434,403 –
– – 951,551 –
(21,114,202)– (46,614,952) (96,375)
20,679,347 – 49,830,438 2,749
33,837,175 417,170 74,832,528 3,016,315
– – 100,096 –
– – 2,099 –
– – 102,195 –
33,837,175$ 417,170$ 74,934,723$ 3,016,315$
78,173$ 33,397$ 440,851$ 86,133$
– – – 227,489
88,585 – 88,585 2,720
3,181 – 146,572 –
8,950 – 8,950 –
– – 33,762 51,782
70,000 – 70,000 –
– – 100,907 –
248,889 33,397 889,627 368,124
– – 11,254 –
446,207 – 446,207 –
– – 727,214 –
– – 370,742 –
– – 64,914 –
446,207 – 1,620,331 –
695,096 33,397 2,509,958 368,124
– – 125,385 –
20,163,140 – 48,486,110 2,749
2,461,488 – 2,461,488 –
10,517,451 383,773 21,351,782 2,645,442
33,142,079 383,773 72,299,380 2,648,191
33,837,175$ 417,170$ 74,934,723$ 3,016,315$
-27-
Page 161 of 352
Liquor Sewer Solid Storm
Operations Operations Waste Water
Operating revenue
Sales 6,765,798$ –$ –$ –$
Charges for services – 2,757,991 9,105 1,327,520
Insurance reimbursement – – – –
Total operating revenue 6,765,798 2,757,991 9,105 1,327,520
Cost of goods sold 5,049,555 – – –
Gross profit 1,716,243 2,757,991 9,105 1,327,520
Operating expenses
Personal services 662,090 830 – 204
Professional services 325,276 2,175,626 54,102 183,212
Materials and supplies 11,627 27,683 22,168 21,573
Insurance – – – –
Depreciation/amortization 163,546 665,198 – 471,134
Total operating expenses 1,162,539 2,869,337 76,270 676,123
Operating income (loss)553,704 (111,346) (67,165) 651,397
Nonoperating revenues (expenses)
Intergovernmental 46 – 4,088 –
Investment earnings 90,136 108,581 70,081 117,340
Loss on sale of capital assets – (605) – (48,916)
Other 4,241 4,575 1,500 100
Interest and fiscal charges (43,987) (2,294)– –
Total nonoperating revenues (expenses)50,436 110,257 75,669 68,524
Income (loss) before
contributions and transfers 604,140 (1,089) 8,504 719,921
Capital contributions – 629,637 – 868,749
Transfers in – – – –
Transfers out (195,126)(355,055)(416,082)(431,654)
Change in net position 409,014 273,493 (407,578) 1,157,016
Net position
Beginning of year 2,035,800 18,677,310 1,872,667 14,755,806
End of year 2,444,814$ 18,950,803$ 1,465,089$ 15,912,822$
Business-Type Activities – Enterprise Funds
CITY OF FARMINGTON
Statement of Revenues, Expenses, and Changes in Fund Net Position
Proprietary Funds
Year Ended December 31, 2023
See notes to basic financial statements -28-
Page 162 of 352
Governmental
Street Activities –
Water Light Total Internal Service
–$ –$ 6,765,798$ –$
2,496,686 237,519 6,828,821 3,797,451
– – – 328,057
2,496,686 237,519 13,594,619 4,125,508
– – 5,049,555 –
2,496,686 237,519 8,545,064 4,125,508
11,314 – 674,438 3,404,583
629,376 214,462 3,582,054 494,315
230,969 295 314,315 181,704
– – – 334,721
1,003,217 – 2,303,095 1,100
1,874,876 214,757 6,873,902 4,416,423
621,810 22,762 1,671,162 (290,915)
6,688 – 10,822 –
511,711 15,730 913,579 129,102
(2,426) – (51,947) –
302,389 1,286 314,091 –
(11,913)– (58,194) –
806,449 17,016 1,128,351 129,102
1,428,259 39,778 2,799,513 (161,813)
785,977 – 2,284,363 –
– – – 35,022
(467,899)– (1,865,816) –
1,746,337 39,778 3,218,060 (126,791)
31,395,742 343,995 69,081,320 2,774,982
33,142,079$ 383,773$ 72,299,380$ 2,648,191$
-29-
Page 163 of 352
Liquor Sewer Solid Storm
Operations Operations Waste Water
Cash flows from operating activities
Cash received from customers 6,757,852$ 2,735,204$ 34,321$ 1,311,044$
Cash receipts from other funds and reimbursements – – – –
Cash payments to suppliers (5,138,489) (2,153,832) (81,517) (198,876)
Cash payments to employees for services (649,386) (830) – (204)
Cash payments for interfund services used – – – –
Net cash flows from operating activities 969,977 580,542 (47,196) 1,111,964
Cash flows from noncapital financing activities
Intergovernmental revenue 46 – 4,088 –
Transfers in – – – –
Transfers out (195,126) (355,055) (416,082) (431,654)
Net cash flows from noncapital financing activities (195,080) (355,055) (411,994) (431,654)
Cash flows from capital and related financing activities
Acquisition and construction of capital assets (6,320) – – –
Principal payment on bonds and leases (94,184) – – –
Interest and fiscal charges paid (43,987) (2,294) – –
Net cash flows from capital and related financing activities (144,491) (2,294) – –
Cash flows from investing activities
Interest received and changes in fair value on investments 85,572 104,863 69,768 111,947
Net increase in cash and cash equivalents 715,978 328,056 (389,422) 792,257
Cash and cash equivalents
Beginning of year 1,636,290 2,398,203 1,847,760 2,153,620
End of year 2,352,268$ 2,726,259$ 1,458,338$ 2,945,877$
Reconciliation of operating income (loss) to net cash flows from
operating activities
Operating income (loss)553,704$ (111,346)$ (67,165)$ 651,397$
Adjustments to reconcile operating income (loss) to net cash flows
from operating activities
Depreciation/amortization 163,546 665,198 – 471,134
Other 4,241 4,575 1,500 100
Change in assets, deferred outflows of resources, liabilities,
and deferred inflows of resources
Accounts receivable (12,187) (35,313) 2,190 (16,576)
Special assessments – 7,951 – –
Due from other governments – – 21,526 –
Inventory 32,941 – – –
Prepaid items – – – –
Deferred outflows of resources – pension plan deferments 59,744 – – –
Deferred outflows of resources – OPEB plan deferments 1,748 – – –
Accounts and contracts payable 207,222 19,657 (5,247) 5,909
Accrued salaries and employee benefits – – – –
Deposits payable – – – –
Due to other governments 7,806 29,820 – –
Compensated absences (1,306) – – –
Net pension liability (148,812) – – –
Total OPEB liability (10,832) – – –
Deferred inflows of resources – pension plan deferments 112,162 – – –
Net cash flows from operating activities 969,977$ 580,542$ (47,196)$ 1,111,964$
Schedule of noncash capital and related financing activities
Capital assets contributed from governmental funds –$ 629,637$ –$ 868,749$
Net book values of capital asset disposals –$ 605$ –$ 48,916$
Amortization of bond premium –$ –$ –$ –$
Business-Type Activities – Enterprise Funds
CITY OF FARMINGTON
Statement of Cash Flows
Proprietary Funds
Year Ended December 31, 2023
See notes to basic financial statements -30-
Page 164 of 352
Governmental
Street Activities –
Water Light Total Internal Service
2,719,569$ 235,210$ 13,793,200$ –$
– – – 4,150,508
(850,433) (215,249) (8,638,396) –
(11,314) – (661,734) (3,411,740)
– – – (958,223)
1,857,822 19,961 4,493,070 (219,455)
6,688 – 10,822 –
– – – 35,022
(467,899) – (1,865,816) –
(461,211) – (1,854,994) 35,022
(28,180) – (34,500) –
(65,000) – (159,184) –
(23,175) – (69,456) –
(116,355) – (263,140) –
493,778 15,243 881,171 126,300
1,774,034 35,204 3,256,107 (58,133)
10,868,091 346,198 19,250,162 3,039,411
12,642,125$ 381,402$ 22,506,269$ 2,981,278$
621,810$ 22,762$ 1,671,162$ (290,915)$
1,003,217 – 2,303,095 1,100
302,389 1,286 314,091 –
(80,231) (3,595) (145,712) 40,738
– – 7,951 –
725 – 22,251 (15,738)
– – 32,941 –
– – – 41,559
– – 59,744 –
– – 1,748 –
19,957 (492) 247,006 9,280
– – – (8,870)
(11,327) – (11,327) 714
1,282 – 38,908 –
– – (1,306) 2,677
– – (148,812) –
– – (10,832) –
– – 112,162 –
1,857,822$ 19,961$ 4,493,070$ (219,455)$
785,977$ –$ 2,284,363$ –$
2,426$ –$ 51,947$ –$
9,913$ –$ 9,913$ –$
-31-
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Page 166 of 352
CITY OF FARMINGTON
Notes to Basic Financial Statements
December 31, 2023
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NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES
A. Organization
The City of Farmington, Minnesota (the City) was incorporated in 1872 and operates under the state of
Minnesota Statutory Plan A form of government. The City Council is the governing body and is
composed of an elected mayor and four councilmembers who exercise legislative authority and determin e
all matters of policy. The City provides the following services: public safety, roads, water and sanitary
sewer, storm water management, solid waste and recycling disposal, public improvements, planning and
zoning, recreation, and general administration.
The accounting policies of the City conform to accounting principles generally accepted in the United
States of America as applicable to governmental units. The Governmental Accounting Standards
Board (GASB) is the accepted standard-setting body for establishing governmental accounting and
financial reporting principles.
B. Reporting Entity
As required by accounting principles generally accepted in the United States of America, these financial
statements include the City (the primary government) and its component unit. Component units are
legally separate entities for which the primary government is financially accountable, or for which the
exclusion of the component unit would render the financial statements of the primary government
misleading. The criteria used to determine if the primary government is financially accountable for a
component unit includes whether or not the primary government appoints the voting majority of the
potential component unit’s board, is able to impose its will on the potential component unit, is in a
relationship of financial benefit or burden with the potential component unit, or is fiscally depended upon
by the potential component unit.
As a result of applying these criteria, one organization has been included in this report as follows:
Blended Component Unit – The Farmington Economic Development Authority (EDA) is the City’s
official decision-making body regarding economic development. The EDA promotes the retention
and expansion of existing businesses, while attracting new businesses to the community in order to
promote a diversified tax base, job opportunities, and convenient shopping for residents. The EDA is
a legally separate entity from the City; however, the City is financially accountable for the EDA. The
EDA’s governing board is comprised of the City’s mayor and councilmembers, and the City has the
ability to impose its will on the EDA. The EDA does not issue separate financial statements.
Therefore, the EDA has been reported as a blended component unit of the City, with its funds
reported as funds of the City.
C. Government-Wide Financial Statement Presentation
The government-wide financial statements (Statement of Net Position and Statement of Activities)
display information about the reporting government as a whole. These statements include all of the
financial activities of the City. Governmental activities, which are normally supported by taxes and
intergovernmental revenues, are reported separately from business-type activities, which significantly rely
upon sales, fees, and charges for support.
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NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
The government-wide Statement of Activities demonstrates the extent to which the direct expense of a
given function (general government, public safety, public works, parks and recreation, and economic
development) or business-type activity (liquor operations, utility services) is offset by program revenues.
Direct expenses are those that are clearly identifiable with a specific function or business-type activity.
Interest on debt is considered an indirect expense and is reported separately in the Statement of Activities.
Depreciation/amortization expense is included in the direct expenses of each function. 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 business-type activity and 2) grants and contributions that
are restricted to meeting the operational or capital requirements of a particular function or business-type
activity. Taxes and other items not included among program revenues are reported instead as general
revenues. Internally directed revenues are reported as general revenues rather than program revenues.
The government-wide financial statements are reported using the economic resources measurement focus
and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when
a liability is incurred, regardless of the timing of related cash flows. Property taxes and special
assessments are recognized as revenues in the fiscal year for which they are certified for levy. Grants and
similar items are recognized when all eligibility requirements imposed by the provider have been met.
As a general rule, the effect of interfund activity has been eliminated from the governm ent-wide financial
statements. However, charges between the City’s enterprise funds and other functions are not eliminated,
as that would distort the direct costs and program revenues reported in those functions.
D. Fund Financial Statement Presentation
Separate fund financial statements are provided for governmental and proprietary funds. Major individual
governmental and enterprise funds are reported as separate columns in the fund financial statements.
Aggregated information for the remaining nonmajor funds is reported in a single column in the respective
fund financial statements.
Governmental fund financial statements are reported using the current financial resources measurement
focus and the modified accrual basis of accounting. Under this basis of accounting, transactions are
recorded in the following manner:
1. Revenue Recognition – Revenue is recognized when it becomes measurable and available.
“Measurable” means the amount of the transaction can be determined and “available” means
collectible within the current period or soon enough thereafter to be used to pay liab ilities of the
current period. For this purpose, the City considers revenues to be available if they are collected
within 60 days after year-end. 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.
Grants and similar items are recognized when all eligibility requirements imposed by the provider
have been met. Proceeds of long-term debt are reported as other financing sources.
Major revenues susceptible to accrual include property taxes, special assessments,
intergovernmental revenue, charges for services, and interest earned on investments. Major
revenue that is not susceptible to accrual includes licenses and permits, fees, and miscellaneous
revenue. Such revenues are recorded only when received because they are not measurable until
collected.
2. Recording of Expenditures – Expenditures are generally recorded when a liability is incurred,
except for principal and interest on long-term debt and other long-term liabilities, which are
recognized as expenditures to the extent they have matured. Capital asset acquisitions are
reported as capital outlay expenditures in the governmental funds.
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NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Proprietary fund financial statements are reported using the economic resources measurement focus and
accrual basis of accounting, similar to the government-wide financial statements. Proprietary funds
distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses
generally result from providing services and producing and delivering goods in connection with a
proprietary fund’s principal ongoing operations. The principal operating revenues of the City’s enterprise
funds and internal service funds are charges to customers for sales and services. The operating expenses
for the enterprise funds and internal service funds include the cost of sales and services, administrative
expenses, and depreciation/amortization on capital assets. All revenues and expenses that do not meet this
definition are reported as nonoperating revenues and expenses.
Aggregated information for the internal service funds is reported in a single column in the propriet ary
fund financial statements. Because the principal user of the internal services is the City’s governmental
activities, the financial statements of the internal service funds are consolidated into the governmental
column when presented in the government-wide financial statements. The cost of these services is
reported in the appropriate functional activity.
Description of Funds
The City reports the following major governmental funds:
General Fund – This fund is the City’s primary operating fund. It accounts for all financial resources
of the general government, except those required to be accounted for in another fund.
Federal Aid Special Revenue Fund – This fund accounts for the operations and activities related to
certain federal funding awarded during the COVID-19 pandemic.
Private Capital Projects Fund – This fund accounts for engineering and administrative fee deposits
related to private development projects within the City.
Storm Water Trunk Capital Projects Fund – This fund accounts for the construction and
improvement of storm water trunk infrastructure within the City.
Closed Bond Debt Service Fund – This fund accounts for accumulated resources related to bond
issues that fully matured or were called by the City using internal resources in prior years, which will
be for future debt service.
The City reports the following major enterprise funds:
Liquor Operations Fund – The Liquor Operations Fund accounts for the retail operations of the
City’s two off-sale municipal liquor stores.
Sewer Operations Fund – The Sewer Operations Fund accounts for the operations of the City’s
wastewater collection and treatment systems.
Solid Waste Fund – The Solid Waste Fund accounts for the revenue and expenses related to the
operation of the City’s garbage collection and recycling programs. The City has been in the process of
transitioning these functions to a private contractor beginning in 2022. It is anticipated that this fund
will be closed in 2024.
Storm Water Fund – The Storm Water Fund accounts for revenues and expenses related to the
maintenance and cleaning of the City’s existing storm water collection and holding pond system.
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NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Water Fund – The Water Fund accounts for the operations of the City’s water distribution system,
including wells, reservoirs, and trunk infrastructure system.
Street Light Fund – The Street Light Fund accounts for the financial activities related to city-owned
street lights.
Additionally, the City reports the following fund type:
Internal Service Funds – Internal service funds account for the financing of goods and services
provided to other departments or agencies of the City on a cost-reimbursement basis. The City’s
internal service funds account for employee benefits expenses, insurance, fleet services, and
technology services.
E. Budgets and Budgetary Accounting
Budgets are prepared annually on a modified accrual basis and legally adopted by the City Council for the
General Fund, most special revenue funds, the Debt Service Fund (in total), and most capital projects
funds. No fiscal 2023 budgets were adopted for the Federal Aid, Police Public Outreach, K-9, or Public
Safety Special Revenue Funds; for the Parking Lot Project, Akin Street Reconstruction, Spruce Street
Reconstruction, Capital Projects Reserve, 2024 Street Improvements, or Emerald Ash Borer Capital
Projects Funds; or for the Closed Bond Debt Service Fund. Budgeted expenditure appropriations lapse at
year-end.
The City follows these procedures in establishing the budgetary data reflected in the financial statements:
1. The city administrator submits a proposed operating budget for the fiscal year commencing the
following January 1 to the City Council. The operating budget includes proposed expenditures
and the means of financing them.
2. The City Council reviews the proposed budgets and makes the appropriate changes.
3. Public hearings are conducted to obtain taxpayer comments.
4. The budgets are legally enacted through passage of a resolution on a departmental basis and can
be expended by each department based upon detailed budget estimates for individual expenditure
accounts.
5. Formal budgetary integration is employed as a management control device during the year for the
governmental and enterprise funds.
6. The legal level of budgetary control is at the fund level. Expenditures may not legally exceed
budgeted appropriations at the total fund level. Monitoring of budgets is maintained at the
expenditure category level (e.g., personnel services, supplies, other services and charges, etc.)
within each department. Management can exceed appropriations at the department level without
City Council approval. The City Council must approve any expenditures over budget at the fund
level by resolution or through the disbursement process.
7. The City Council may authorize transfers of budgeted amounts between funds.
Page 170 of 352
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NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
For the year ended December 31, 2023, expenditures exceeded budget for the following funds.
Expenditures in excess of budget were approved by the City Council either through the disbursement
process or separate City Council action.
Budgeted Actual
Expenditures Expenditures
Major funds
Storm Water Trunk Capital Projects –$ 7,883$
Nonmajor special revenue funds
Police Donations and Forfeitures 2,000$ 2,195$
Arena 453,107$ 493,543$
Nonmajor capital projects funds
Sanitary Sewer Trunk –$ 18,575$
Fire 7,000$ 42,998$
General Capital Equipment 557,408$ 1,315,883$
F. Cash and Investments
Cash and investments include balances from all funds that are combined and invested to the extent
available in various securities as authorized by state law. Earnings from the pooled investments are
allocated to the respective funds based on month-end outstanding balances for each fund.
Certain resources set aside for future use, such as the construction of a drinking water treatment plant , are
classified as restricted assets on the Statement of Net Position, because their use is limited by outside
agreements. Interest on these investments is allocated to the respective fund.
For purposes of the Statement of Cash Flows, the City considers all highly liquid instruments with an
original maturity from the time of purchase by the City of three months or less to be cash equivalents. The
proprietary funds’ portion in the government-wide cash and investment management pool is considered
cash equivalent.
It is the City’s policy to invest in a manner that seeks to ensure preservation of capital in the overall
portfolio. Safety of principal is the foremost objective, but liquidity and yield are also important
considerations. The objective will be to mitigate credit risk by purchasing only highly rated securities or
with adequate collateral and interest rate risk by matching maturities to cash flow needs and holding
securities to maturity.
The City reports all investments at fair value. The City categorizes its fair value measurements within the
fair value hierarchy established by accounting principles generally accepted in the United States of
America. 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; and Level 3 inputs are significant unobservable inputs. Debt securities classified in
Level 2 of the fair value hierarchy are valued using a matrix pricing technique. Matrix pricing is used to
value securities based on the securities’ relationship to benchmark quoted prices.
See Note 2 for the City’s recurring fair value measurements as of the current year-end.
Page 171 of 352
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NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
G. Receivables
Utility and miscellaneous accounts receivable are reported at gross. Since the City is generally able to
certify delinquent amounts to the county for collection as special assessments; no allowance for
uncollectible accounts has been provided on current receivables. Receivables not expected to be fully
collected within one year include leases, special assessments, property taxes, and certain state-aid
receivables.
H. Interfund Balances and Transfers
In the fund financial statements, balances between funds that are representative of lending or borrowing
arrangements are reported as either “due to/from other funds” (current portion) or “advances to/from other
funds.” All other outstanding balances between funds are reported as “due to/from other funds.” Interfund
balances and transfers reported in the fund financial statements are eliminated to the extent possible in the
government-wide financial statements. Any residual balances outstanding between the governmental
activities and business-type activities are reported in the government-wide financial statements as
“internal balances.”
I. Property Taxes
Property tax levies are set by the City Council in December of each year and certified to Dakota County
for collection in the following year. In Minnesota, counties act as collection agents for all property taxes,
spreading the levies over all taxable property. Such taxes become a lien on January 1 and are recorded as
receivables by the City on that date. Tax levies on real property are payable in two equal installments on
May 15 and October 15. Personal property taxes are due in full on May 15. The county provides tax
settlements to cities and other taxing districts four times a year: in June, July, December, and January.
Property taxes are recognized as revenue in the year levied in the government -wide financial statements
and proprietary fund financial statements. In the governmental fund financial statements, taxes are
recognized as revenue when received in cash or within 60 days after year-end. Taxes which remain
unpaid on December 31 are classified as delinquent taxes receivable and are offset by a deferred inflow of
resources in the governmental fund financial statements.
J. Special Assessments
Special assessments represent the financing for public improvements paid for by benefiting property
owners. Special assessments are recorded as receivables upon certification to the county. Special
assessments are recognized as revenue in the year levied in the government-wide financial statements and
proprietary fund financial statements. In the governmental fund financial statements, special assessments
are recognized as revenue when received in cash or within 60 days after year-end. Governmental fund
special assessments receivable which remain unpaid on December 31, are offset by a deferred inflow of
resources in the governmental fund financial statements.
K. Inventories
Inventories of the proprietary funds, primarily the liquor operations, are stated at cost, which
approximates market, using the average cost method.
L. Prepaid Items
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as
prepaid items in both government-wide and fund financial statements. Prepaid items are reported using
the consumption method and recorded as expenditures/expenses at the time of consumption.
Page 172 of 352
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NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
M. Capital Assets
Capital assets, which include property, buildings, improvements, equipment, infrastructure assets (roads,
bridges, sidewalks, and similar items), and intangible assets, such as easements, are reported in the
applicable governmental or business-type activities columns in the government-wide financial statements
and in the proprietary fund financial statements, but not in the governmental fund 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 estimated acquisition value on
the date of donation. Lease assets are recorded based on the measurement of payments applicable to the
lease term. The City defines capital assets as those with an initial, individual cost of $5,000 or more with
an estimated useful life in excess of five years. 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.
Land, easements, and construction in progress are not depreciated. Lease assets are amortized over the
term of the lease or over the useful life of the applicable asset class previously described, if future
ownership is anticipated. The other classes of capital assets are depreciated using the straight-line method
over the following estimated useful lives:
Buildings 20–50 years
Improvements other than buildings 20–50 years
Machinery and equipment 5–20 years
Infrastructure 30 years
Collection/distribution systems 50 years
N. Deferred Outflows/Inflows of Resources
In addition to assets and liabilities, statements of financial position or balance sheets may report separate
financial statement elements called deferred outflows of resources or deferred inflows of resources. These
separate financial statement elements represent a consumption or acquisition of net assets, respectively,
that apply to future periods and will not be recognized as an outflow of financial resources
(expense/expenditure) or an inflow of financial resources (revenue) until then.
Deferred outflows and inflows of resources related to pension and other post-employment benefits
(OPEB) plans are reported in the government-wide and enterprise funds Statements of Net Position.
These deferred outflows and inflows result from differences between expected and actual experience,
changes in proportion, changes of assumptions, net collective difference between projected and actual
earnings on plan investments, and from contributions to the plans subsequent to the measurement date
and before the end of the reporting period. These amounts are deferred and amortized as required under
applicable pension or OPEB standards.
The City also reports deferred inflows of resources related to leases. Lessors are required to recognize
deferred inflows of resources corresponding to lease receivables, which are reported in both the
governmental fund financial statements and the government-wide financial statements. These amounts are
deferred and amortized in a systematic and rationale manner over the term of the lease.
Unavailable revenue arises only under a modified accrual basis of accounting and, therefore, is only
reported in the governmental funds Balance Sheet. The governmental funds report unavailable revenue
from: property taxes, special assessments, and long-term receivables. These amounts are deferred and
recognized as inflows of resources in the period that the amounts become available.
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NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
O. Long-Term Obligations
In the government-wide and proprietary fund financial statements, long-term debt and other long-term
obligations are reported as liabilities. Bond premiums and discounts, if material, are deferred and
amortized over the life of the bonds using the straight-line method.
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.
P. Compensated Absences
It is the City’s policy to permit employees to accumulate earned, but unused leave benefits as either paid
time off (PTO), or vacation and sick leave. Under the City’s personnel policies and collective bargaining
contracts, city employees are granted leave benefits in varying amounts based on length of service. No
liability is recorded for nonvesting accumulating rights to receive sick leave benefits. As benefits accrue
to employees, the accumulated PTO, vacation, and vested sick leave is reported as expense and liability in
the government-wide and proprietary fund financial statements. Accrued PTO, vacation, and any po rtion
of sick leave payable to employees upon termination are reported as expenditures in the governmental
fund that will pay them when they become due and payable.
Q. State-Wide Pension Plans
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 the PERA’s fiduciary net position have been determined on the
same basis as they are reported by the PERA. 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.
R. Risk Management
The City is exposed to various risks of loss related to torts: theft of, damage to, and destruction of assets;
errors and omissions; injuries to employees; and natural disasters. The City continues to carry commercial
insurance for risks of loss, including workers’ compensation, property and general liability, and employee
health and accident insurance. The City retains risk for the deductible portions of the insurance policies.
The amount of these deductibles is considered immaterial to the financial statements.
Property and Casualty Insurance – Property and casualty insurance is provided through the League of
Minnesota Cities Insurance Trust (LMCIT), a public entity risk pool currently operating as a common risk
management and insurance program for Minnesota cities: general liability, excess liability, property,
automobile, marine, crime, federal laws, employee dishonesty, boiler, petro fund, and open meeting law.
The City pays an annual premium to the LMCIT for its insurance coverage. The LMCIT is self -sustaining
through member premiums and will reinsure through commercial companies for excess claims. The LMCIT
allows the pool to make additional assessments to make the pool self-sustaining.
Current state statutes (Minnesota Statutes, Subd. 466.04) provide limits of liability for the City. These limits
are that the combination of defense expense and indemnification expense shall not exceed $500,000 in the
case of one claimant or $1,500,000 for any number of claims arising out of a single occurrence. The City
retains risk for the deductible portion of its insurance policies and any potential judicial ruling in excess of
the statutory maximum. The City has never had a claim in excess of the statutory maximum. 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.
Page 174 of 352
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NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Workers’ Compensation Insurance – Workers’ compensation coverage 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 as deemed necessary by the LMCIT. The LMCIT reinsures through
the Workers’ Compensation Reinsurance Association as required by law. The City’s premiums are
determined after loss experience is known. The amount of premium adjustment, if any, is considered
immaterial, and is not recorded until received or paid.
S. Net Position Classifications and Flow Assumptions
In the government-wide and proprietary fund financial statements, net position represents the difference
between assets, deferred outflows of resources, liabilities, and deferred inflows of resources. Net position
is displayed in three components:
• Net Investment in Capital Assets – Consists of capital assets, net of accumulated depreciation
and amortization, reduced by any outstanding debt attributable to acquire capital assets.
• Restricted Net Position – Consists of net position restricted when there are limitations imposed
on their use through external restrictions imposed by creditors, grantors, or laws or regulations of
other governments.
• Unrestricted Net Position – All other elements of net position that do not meet the definition of
“restricted” or “net investment in capital assets.”
The City applies restricted resources first when an expense is incurred for which both restricted and
unrestricted resources are available.
T. Fund Balance Classifications and Flow Assumptions
In the fund financial statements, governmental funds report fund balance in classifications that disclose
constraints for which amounts in those funds can be spent. These classifications are as follows:
• Nonspendable – Consists of amounts that are not in spendable form, such as prepaid items,
inventory, and other long-term assets.
• Restricted – Consists of amounts related to externally imposed constraints established by
creditors, grantors, or contributors; or constraints imposed by state statutory provisions.
• Committed – Consists of internally imposed constraints that are established by resolution of the
City Council. Those committed amounts cannot be used for any other purpose unless the City
Council removes or changes the specified use by taking the same type of action it employed to
previously commit those amounts.
• Assigned – Consists of internally imposed constraints for amounts intended to be used by the
City for specific purposes, but do not meet the criteria to be classified as restricted or committed.
These constraints are established by the City Council and/or management. The City Council has
adopted a fund balance policy, which delegates the authority to assign amounts for specific
purposes to the city administrator and/or finance director.
• Unassigned – The residual classification for the General Fund, which also reflects negative
residual amounts in other funds.
When both restricted and unrestricted resources are available for use, the City first uses restricted
resources, then unrestricted resources as needed. When committed, assigned, or unassigned resources are
available for use, the City uses resources in the following order: 1) committed, 2) assigned, and
3) unassigned.
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NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
U. Use of Estimates
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 the
amounts reported in the financial statements during the reporting period. Actual results could differ from
those estimates.
NOTE 2 – DEPOSITS AND INVESTMENTS
A. Components of Cash and Investments
Cash and investments at year-end consist of the following:
Deposits 12,294,914$
Investments 44,344,873
Petty cash 4,032
Total 56,643,819$
Cash and investments are included on the basic financial statements as follows:
Statement of Net Position
Cash and investments 54,182,331$
Restricted assets – temporarily restricted
Cash for future drinking water treatment plant 2,461,488
Total 56,643,819$
B. Deposits
In accordance with applicable Minnesota Statutes, the City maintains deposits at depository banks
authorized by the City Council, including checking and savings accounts.
The following is considered the most significant risk associated with deposits:
Custodial Credit Risk – In the case of deposits, this is the risk that in the event of a bank failure, the
City’s deposits may be lost.
Minnesota Statutes require that all deposits be protected by federal deposit insurance, corporate surety
bond, or collateral. The market value of collateral pledged must equal 110 percent of the deposits not
covered by federal deposit insurance or corporate surety bonds. Authorized collateral includes
treasury bills, notes, and bonds; issues of U.S. government agencies; general obligations rated “A” or
better; revenue obligations rated “AA” or better; irrevocable standard letters of credit issued by the
Federal Home Loan Bank; and certificates of deposit. Minnesota Statutes require that securities
pledged as collateral be held in safekeeping in a restricted account at the Federal Reserve Bank or in
an account at a trust department of a commercial bank or other financial institution that is not owned
or controlled by the financial institution furnishing the collateral. The City has no additional deposit
policies addressing custodial credit risk.
At year-end, the carrying amount of the City’s deposits was $12,294,914, while the balance on the
bank records was $12,486,284. At December 31, 2023, all deposits were fully covered by federal
deposit insurance, surety bonds, or by collateral held by the City’s agent in the City’s name.
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NOTE 2 – DEPOSITS AND INVESTMENTS (CONTINUED)
C. Investments
The City has the following investments at year-end:
Fair Value
Measurements
Investment Type Rating Agency Using Less Than 1 1 to 5 Total
U.S. treasury securities Level 2 8,814,196$ 2,599,511$ 11,413,707$
U.S. agency securities AA S&P Level 2 3,054,505 10,898,521 13,953,026
U.S. agency securities Aaa Moody’s Level 2 – 457,332 457,332
Municipal bonds AAA S&P Level 2 – 1,287,478 1,287,478
Municipal bonds Aa Moody’s Level 2 586,304 4,213,307 4,799,611
Municipal bonds AA S&P Level 2 888,541 4,529,256 5,417,797
Municipal bonds A Moody’s Level 2 – 369,568 369,568
Negotiable certificates
of deposit Level 2 2,983,634 3,408,038 6,391,672
16,327,180$ 27,763,011$ 44,090,191
Investment pools/mutual funds AAA S&P Level 1 254,682
Total investments 44,344,873$
Credit Risk
Not Rated
Interest Risk – Maturity
Duration in Years
Not Applicable
Investments are subject to various risks, the following of which are considered the most significant:
Custodial Credit Risk – For investments, this is the risk that in the event of a failure of the
counterparty to an investment transaction (typically a broker-dealer) the City would not be able to
recover the value of its investments or collateral securities that are in the possession of an outside
party. The City’s investment policies do not further address this risk.
Credit Risk – This is the risk that an issuer or other counterparty to an investment will not fulfill its
obligations. Minnesota Statutes limit the City’s investments to direct obligations or obligations
guaranteed by the United States or its agencies; shares of investment companies registered under the
Federal Investment Company Act of 1940 that receive the highest credit rating, are rated in one of the
two highest rating categories by a statistical rating agency, and all of the investments have a final
maturity of 13 months or less; general obligations rated “A” or better; revenue obligations rated “AA”
or better; general obligations of the Minnesota Housing Finance Agency rated “A” or better; bankers’
acceptances of United States banks eligible for purchase by the Federal Reserve System; commercial
paper issued by United States corporations or their Canadian subsidiaries, rated of the highest quality
category by at least two nationally recognized rating agencies, and maturing in 270 days or less;
Guaranteed Investment Contracts guaranteed by a United States commercial bank, domestic branch of
a foreign bank, or a United States insurance company, and with a credit quality in one of the top
two highest categories; repurchase or reverse purchase agreements and securities lending agreements
with financial institutions qualified as a “depository” by the government entity, with banks that are
members of the Federal Reserve System with capitalization exceeding $10,000,000; that are a
primary reporting dealer in U.S. government securities to the Federal Reserve Bank of New York; or
certain Minnesota securities broker-dealers. The City’s investment policies do not further address
credit risk.
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NOTE 2 – DEPOSITS AND INVESTMENTS (CONTINUED)
Concentration Risk – This is the risk associated with investing a significant portion of the City’s
investments (considered 5.0 percent or more) in the securities of a single issuer, excluding
U.S. guaranteed investments (such as treasuries), investment pools, and mutual funds. The City’s
investment policy places no limit on the amount the City may invest in any one issuer. However, it
discusses the need to diversify investments to minimize risk. Of the City’s investment portfolio at
December 31, 2023, 15.2 percent were issued by the Federal Home Loan Bank, 7.0 percent were
issued by the Federal Farm Credit Bank, and 6.0 percent were issued by the Federal National
Mortgage Association.
Interest Rate Risk – This is the risk of potential variability in the fair value of fixed rate investments
resulting from changes in interest rates (the longer the period for which an interest rate is fixed, the
greater the risk). The City’s investment policy states the investment portfolio should be structured to
meet cash requirements for ongoing operations. The policy limits investment maturities as a means of
managing exposure to fair value losses arising from increasing interest rates, stating that no more than
30 percent of total investments should extend beyond 5 years and none should extend beyond
15 years. The City’s year-end investment portfolio maturities comply with this policy.
NOTE 3 – INTERFUND BALANCES AND TRANSFERS
A. Interfund Balances
The City had the following interfund balances at year-end:
Payable Fund Purpose Amount
Governmental Governmental
General Nonmajor Cash flow 2,691$
Nonmajor Nonmajor Cash flow 35,379
38,070$
Receivable Fund
B. Interfund Transfers
The following transfers were made during the year:
Proprietary
Debt Service Internal
General – Closed Bond Nonmajor Service Total
Governmental
General –$ –$ 1,609,000$ (3)33,022$ (1)1,642,022$
Nonmajor – 1,046,942 (2)423,446 (4)– 1,470,388
Proprietary – Enterprise
Liquor Operations 94,126 (1)– 100,000 (5)1,000 (1)195,126
Sewer Operations 354,055 (1)– – 1,000 (1)355,055
Solid Waste 150,000 (1)– 266,082 (6)– 416,082
Storm Water 431,654 (1)– – – 431,654
Water 467,899 (1)– – – 467,899
1,497,734$ 1,046,942$ 2,398,528$ 35,022$ 4,978,226$
(1)To fund administrative overhead costs.
(2)To close debt service accounts for matured or called bond issues.
(3)For EDA operations ($50,000), ice arena ($20,000), emerald ash borer abatement ($50,000), or capital purposes ($1,489,000).
(4)For EDA operations ($36,969), ice arena ($70,243), or to close funds ($316,234).
(5)For park improvements.
(6)For emerald ash borer abatement.
Transfers In
Governmental
Transfers Out
Total
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NOTE 4 – LEASES RECEIVABLE
In 2018, the City entered into an agreement to lease space in City Hall to the U.S. Department of
Agriculture (USDA). The USDA is required to make monthly payments for the space rental for a 20 -year
term maturing February 28, 2038, with a 3.0 percent interest rate. As part of this agreement, the City
made improvements to the space in accordance with USDA specifications with a total cost of $113,500.
The USDA will reimburse the City for the full cost of these improvements through noncancelable
monthly payments annually over a 10-year period, with 3.0 percent interest. During the current year, the
City received principal and interest payments of $16,908. Additionally, the City received $12,637 in other
variable payments for common area maintenance fees, which are not a part of the lease asset.
NOTE 5 – CAPITAL ASSETS
Capital asset activity for the year ended December 31, 2023 was as follows:
A. Changes in Capital Assets Used in Governmental Activities
Beginning Completed Ending
Balance Additions Deletions Construction Transfers Balance
Capital assets, not depreciated/amortized
Land 1,350,435$ –$ –$ –$ –$ 1,350,435$
Easements 307,867 – – – – 307,867
Construction in progress 2,574,042 4,677,102 – (6,696,191) – 554,953
Total capital assets, not
depreciated/amortized 4,232,344 4,677,102 – (6,696,191) – 2,213,255
Capital assets, depreciated/amortized
Buildings 21,303,850 – – – – 21,303,850
Improvements other than buildings 1,848,362 524,792 – 76,560 – 2,449,714
Machinery and equipment 9,391,667 272,980 (411,620) – – 9,253,027
Infrastructure 59,421,059 – (726,989) 6,619,631 (2,284,363) 63,029,338
Leases – vehicles 99,641 720,678 – – – 820,319
Total capital assets,
depreciated/amortized 92,064,579 1,518,450 (1,138,609) 6,696,191 (2,284,363) 96,856,248
Less accumulated depreciation/amortization
Buildings 8,006,839 433,533 – – – 8,440,372
Improvements other than buildings 1,553,212 72,034 – – – 1,625,246
Machinery and equipment 5,492,487 541,915 (408,233) – – 5,626,169
Infrastructure 33,622,787 1,370,761 (726,989) – – 34,266,559
Leases – vehicles 10,571 97,522 – – – 108,093
Total accumulated
depreciation/amortization 48,685,896 2,515,765 (1,135,222) – – 50,066,439
Net capital assets,
depreciated/amortized 43,378,683 (997,315) (3,387) 6,696,191 (2,284,363) 46,789,809
Total capital assets, net 47,611,027$ 3,679,787$ (3,387)$ –$ (2,284,363)$ 49,003,064$
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NOTE 5 – CAPITAL ASSETS (CONTINUED)
B. Changes in Capital Assets Used in Business-Type Activities
Beginning Ending
Balance Additions Deletions Transfers Balance
Capital assets, not depreciated/amortized
Land 498,376$ –$ –$ –$ 498,376$
Capital assets, depreciated/amortized
Buildings 5,290,137 – – – 5,290,137
Improvements other than buildings 1,893,094 – – – 1,893,094
Machinery and equipment 2,270,459 34,500 – – 2,304,959
Collection/distribution systems 83,461,594 – (238,684) 2,284,363 85,507,273
Leases – buildings 951,551 – – – 951,551
Total capital assets,
depreciated/amortized 93,866,835 34,500 (238,684) 2,284,363 95,947,014
Less accumulated depreciation/amortization
Buildings 3,956,508 205,130 – – 4,161,638
Improvements other than buildings 395,195 105,811 – – 501,006
Machinery and equipment 1,637,743 157,195 – – 1,794,938
Collection/distribution systems 38,453,030 1,714,332 (186,737) – 39,980,625
Leases – buildings 56,118 120,627 – – 176,745
Total accumulated
depreciation/amortization 44,498,594 2,303,095 (186,737) – 46,614,952
Net capital assets,
depreciated/amortized 49,368,241 (2,268,595) (51,947) 2,284,363 49,332,062
Total capital assets, net 49,866,617$ (2,268,595)$ (51,947)$ 2,284,363$ 49,830,438$
C. Depreciation/Amortization Expense by Function
Depreciation/amortization expense was charged to the following functions:
Governmental activities
General government 1,568,023$
Public safety 475,398
Public works 212,989
Parks and recreation 259,355
Total depreciation/amortization expense – governmental activities 2,515,765$
Business-type activities
Liquor operations 163,546$
Sewer operations 665,198
Storm water 471,134
Water 1,003,217
Total depreciation/amortization expense – business-type activities 2,303,095$
Page 180 of 352
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NOTE 6 – LONG-TERM LIABILITIES
A. Components of Long-Term Liabilities
Final
Original Interest Issue Maturity Balance –
Issue Rate Date Date End of Year
Governmental activities
General obligation improvement bonds
G.O. Street Reconstruction Bonds 2015A 3,050,000$ 2.00–3.00%10/15/2015 02/01/2030 1,575,000$
G.O. Street Reconstruction Bonds 2019A 925,000$ 5.00%05/15/2019 02/01/2024 210,000
G.O. Street Reconstruction Bonds 2022A 3,650,000$ 3.00–5.00%07/06/2022 02/01/2033 3,650,000
Total general obligation improvement bonds 5,435,000
General obligation capital improvement bonds
G.O. Capital Improvement Refunding Bonds 2016B 4,540,000$ 2.00–3.00%12/01/2016 02/01/2028 2,965,000
General obligation equipment certificates
G.O. Equipment Certificates of Indebtedness 2020A 1,105,000$ 5.00%02/19/2020 02/01/2026 695,000
Total bonds and certificates 9,095,000
Unamortized premiums 544,915
Lease liabilities
Lease – vehicle 31,238$ 6.62%06/23/2022 06/30/2026 21,807
Lease – vehicle 31,238$ 6.62%06/23/2022 06/30/2026 22,984
Lease – vehicle 29,970$ 7.71%09/23/2022 09/30/2026 21,807
Lease – vehicle 30,637$ 2.68%03/13/2023 03/31/2028 25,988
Lease – vehicle 30,590$ 2.68%03/16/2023 03/31/2028 25,988
Lease – vehicle 30,590$ 2.68%03/16/2023 03/31/2028 25,988
Lease – vehicle 30,590$ 2.68%03/16/2023 03/31/2028 25,988
Lease – vehicle 44,510$ 3.53%04/19/2023 04/30/2028 38,551
Lease – vehicle 50,395$ 2.31%05/25/2023 05/31/2028 44,564
Lease – vehicle 39,285$ 2.79%07/24/2023 07/31/2027 35,129
Lease – vehicle 42,292$ 2.74%07/27/2023 07/31/2028 38,795
Lease – vehicle 40,296$ 2.74%08/21/2023 08/31/2028 37,482
Lease – vehicle 40,296$ 2.74%08/21/2023 08/31/2028 37,482
Lease – vehicle 40,296$ 2.74%08/21/2023 08/31/2028 37,482
Lease – vehicle 40,129$ 2.74%08/24/2023 08/31/2028 37,383
Lease – vehicle 39,267$ 2.79%08/25/2023 08/31/2027 35,911
Lease – vehicle 57,934$ 2.74%08/31/2023 08/31/2028 54,163
Lease – vehicle 39,264$ 3.53%10/12/2023 10/31/2027 37,152
Lease – vehicle 39,302$ 3.53%10/12/2023 10/31/2027 37,188
Lease – vehicle 39,302$ 3.53%10/12/2023 10/31/2027 37,188
Lease – vehicle 39,264$ 3.53%10/12/2023 10/31/2027 37,151
Total lease liabilities 716,171
Compensated absences 1,052,961
Total governmental activities 11,409,047$
Business-type activities
General obligation revenue bonds
G.O. Water Revenue Bonds 2019A 720,000$ 4.00–5.00%05/15/2019 02/01/2029 465,000$
Unamortized premiums 51,207
Lease liabilities
Lease – buildings (Downtown liquor store)745,373$ 6.62%10/01/2021 05/31/2036 689,258
Lease – buildings (Pilot Knob liquor store)211,684$ 5.00%12/01/2022 11/30/2025 138,863
Total lease liabilities 828,121
Compensated absences 45,016
Total business-type activities 1,389,344$
Page 181 of 352
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NOTE 6 – LONG-TERM LIABILITIES (CONTINUED)
B. Bonds and Certificates Payable
• General Obligation Bonds – The City issues general obligation bonds to provide funds for the
acquisition and construction of major capital improvements or to refinance (refund) previous
bond issues. The reporting entity’s long-term debt is segregated between the amounts to be repaid
from governmental activities and amounts to be repaid from business-type activities. General
obligation bonds are direct obligations and pledge the full faith and credit of the City.
• General Obligation Equipment Certificates – The City issues general obligation equipment
certificates of indebtedness in accordance with Minnesota Statutes § 412.301 to finance the
purchase of equipment, which will be repaid primarily through ad valorem tax levies.
• General Obligation Revenue Bonds – The City issues general obligation revenue bonds to
finance capital improvements in the enterprise funds. These bonds will be repaid from future net
operating revenues pledged from enterprise funds and are backed by the taxing power of the City.
Minimum annual payments required to retire bonds and certificates are as follows:
Governmental Activities
Year Ending
December 31,Principal Interest Principal Interest Principal Interest Principal Interest
2024 740,000$ 194,400$ 560,000$ 68,200$ 220,000$ 29,250$ 1,520,000$ 291,850$
2025 550,000 168,100 575,000 51,175 230,000 18,000 1,355,000 237,275
2026 570,000 147,450 595,000 33,625 245,000 6,125 1,410,000 187,200
2027 585,000 125,450 610,000 18,600 – – 1,195,000 144,050
2028 610,000 101,950 625,000 6,250 – – 1,235,000 108,200
2029–2033 2,380,000 190,388 – – – – 2,380,000 190,388
Total 5,435,000$ 927,738$ 2,965,000$ 177,850$ 695,000$ 53,375$ 9,095,000$ 1,158,963$
G.O. Improvement G.O. Capital Improvement TotalG.O. Equipment
Business-Type Activities
Year Ending
December 31,Principal Interest
2024 70,000$ 19,800$
2025 70,000 16,300
2026 75,000 12,675
2027 80,000 8,800
2028 85,000 5,100
2029 85,000 1,700
Total 465,000$ 64,375$
G.O. Revenue
C. Revenue Pledged
Future revenue pledged for the payment of long-term bonded debt is as follows:
Percent Remaining Principal Pledged
Use of of Debt Term of Principal and Interest Revenue
Bond Issue Proceeds Type Service Pledge and Interest Paid Received
G.O. Water Revenue Bonds 2019A Utility improvements Utility charges 100%2019–2029 529,375$ 88,175$ 2,496,686$
Current YearRevenue Pledged
Page 182 of 352
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NOTE 6 – LONG-TERM LIABILITIES (CONTINUED)
D. Ultimate Responsibility for Debt
All general obligation bonds are backed by the full faith and credit of the City.
The City is subject to statutory limitation by the state of Minnesota for bonded indebtedness payable
principally from property taxes equal to 3.0 percent of the taxable market value of property in the City. As
of December 31, 2023, the City had not utilized $77,713,834 of its $86,808,834 legal debt limit.
E. Lease Liabilities
• Leases – Vehicles – The City is leasing a number of vehicles under agreements that are secured
by the leased equipment. The total amount of underlying lease assets by major classes and the
related accumulated amortization is presented in Note 5 of the notes to basic financial statements.
The leases are being paid by the (nonmajor) General Capital Equipment Capital Projects Fund.
• Leases – Buildings – The City operates two retail liquor stores known colloquially as Downtown
and Pilot Knob. The City leases building space through two agreements that are being paid by the
Liquor Operations Enterprise Fund. The Downtown store lease is for an approximately
7,400 square foot space in the Farmington Mall, for which the City paid $26,545 in common area
operating expenses in 2023 that are not included in the lease liability. The Pilot Knob location
occupies a 4,758 square foot store in the Farmington Gateway Center, for which the City paid
$45,915 in common area operating expenses in 2023 that are not included in the lease liability.
The total amount of underlying lease assets by major classes and the related accumulated
amortization is presented in Note 5 of the notes to basic financial statements.
Minimum annual payments required to retire bonds and certificates are as follows:
Year Ending
December 31,Principal Interest Principal Interest
2024 171,422$ 20,986$ 100,907$ 39,125$
2025 177,459 14,587 101,686 33,919
2026 171,792 8,098 37,356 30,440
2027 145,574 3,287 41,348 28,482
2028 49,924 425 45,607 26,318
2029–2033 – – 302,380 90,933
2034–2036 – – 198,837 12,814
Total 716,171$ 47,383$ 828,121$ 262,031$
Vehicle Leases Liquor Store Building Leases
Governmental Activities Business-Type Activities
F. Other Long-Term Liabilities
The City provides its employees with various benefits, including compensated absences, and pension
benefits and OPEB as further described elsewhere in these notes. The General Fund and Liquor
Operations Enterprise Fund will be used to liquidate these liabilities.
Page 183 of 352
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NOTE 6 – LONG-TERM LIABILITIES (CONTINUED)
G. Changes in Long-Term Liabilities
Beginning Ending Due Within
Balance Additions Deletions Balance One Year
Governmental activities
G.O. improvement bonds 6,305,000$ –$ 870,000$ 5,435,000$ 740,000$
G.O. capital improvement bonds 3,510,000 – 545,000 2,965,000 560,000
G.O. equipment certificates 905,000 – 210,000 695,000 220,000
Unamortized premiums 668,370 – 123,455 544,915 –
Lease liabilities 83,029 714,239 81,097 716,171 171,422
Compensated absences 1,134,365 706,003 787,407 1,052,961 789,721
Total governmental activities 12,605,764 1,420,242 2,616,959 11,409,047 2,481,143
Business-type activities
G.O. revenue bonds 530,000 – 65,000 465,000 70,000
Unamortized premiums 61,120 – 9,913 51,207 –
Lease liabilities 922,305 – 94,184 828,121 100,907
Compensated absences 46,322 27,186 28,492 45,016 33,762
Total business-type activities 1,559,747 27,186 197,589 1,389,344 204,669
Total government-wide 14,165,511$ 1,447,428$ 2,814,548$ 12,798,391$ 2,685,812$
NOTE 7 – DEFINED BENEFIT PENSION PLANS
Employees of the City participate in three defined benefit pension plans. Two of the plans are state-wide,
cost-sharing, multiple-employer defined benefit pension plans administered by the PERA of
Minnesota: the General Employees Retirement Fund (GERF) and the Public Employees Police and Fire
Fund (PEPFF). The third is a single-employer defined benefit pension plan administered through the
Farmington Fire Fighters’ Relief Association (the Association). The details of the City’s participation in
each of these plans are presented later in these notes. The following table summarizes the impact of these
plans on the City’s government-wide financial statements:
Farmington
Fire Fighters’
Relief Total
GERF PEPFF Total Association All Plans
Net pension asset –$ –$ –$ 1,536,553$ 1,536,553$
Deferred outflows of resources 1,000,960$ 6,453,848$ 7,454,808$ 851,277$ 8,306,085$
Net pension liability 3,707,422$ 4,241,193$ 7,948,615$ –$ 7,948,615$
Deferred inflows of resources 1,253,850$ 6,202,494$ 7,456,344$ 667,434$ 8,123,778$
Pension expense 629,463$ 1,248,580$ 1,878,043$ 205,963$ 2,084,006$
State-Wide PERA Pension Plans
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE
A. Plan Descriptions
The City participates in the following cost-sharing, multiple-employer defined benefit pension plans
administered by the Public Employees Retirement Association (PERA) of Minnesota. The PERA’s
defined benefit pension plans are established and administered in accordance with Minnesota Statutes,
Chapters 353 and 356. The PERA’s defined benefit pension plans are tax qualified plans under
Section 401(a) of the Internal Revenue Code (IRC).
1. General Employees Retirement Fund (GERF)
All full-time and certain part-time employees of the City are covered by the GERF. The GERF
members belong to the Coordinated Plan. Coordinated Plan members are covered by Social
Security.
2. Public Employees Police and Fire Fund (PEPFF)
The Public Employees Police and Fire Fund (PEPFF), 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 PEPFF also covers police officers and
firefighters belonging to local relief associations that elected to merge with and transfer assets and
administration to the PERA.
B. Benefits Provided
The PERA provides retirement, disability, and death benefits. Benefit provisions are established by state
statutes 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 t hey last
terminated their public service.
1. GERF Benefits
Benefits are based on a member’s highest average salary for any five successive years of
allowable service, age, and years of credit at termination of service. Two methods are used to
compute benefits for the 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 Plan members is
1.2 percent for each of the first 10 years of service, and 1.7 percent for each additional year.
Under Method 2, the accrual rate for Coordinated Plan members is 1.7 percent for all years of
service. For members hired prior to July 1, 1989, a full annuity is available when age plus years
of service equal 90, and normal retirement age is 65. For members hired on or after July 1, 1989,
normal retirement age is the age for unreduced Social Security benefits capped at age 66.
Page 185 of 352
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
Benefit increases are provided to benefit recipients each January. The post-retirement increase is
equal to 50.0 percent of the cost of living adjustment (COLA) announced by the Social Security
Administration, with a minimum increase of at least 1.0 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. In 2023, legislation
repealed the statute delaying increases for members retiring before full retirement age.
2. PEPFF Benefits
Benefits for the PEPFF members first hired after June 30, 2010 but before July 1, 2014, vest on a
prorated basis from 50.0 percent after five years, up to 100.0 percent after 10 years of credited
service. Benefits for the PEPFF members first hired after June 30, 2014, vest on a prorated basis
from 50.0 percent after 10 years, up to 100.0 percent after 20 years of credited service. The
annuity accrual rate is 3.0 percent of average salary for each year of service. For Police and Fire
Plan members who were first hired prior to July 1, 1989, a full annuity is available when age plus
years of service equal at least 90.
Benefit increases are provided to benefit recipients each January. The post-retirement increase is
fixed at 1.0 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.
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.
In 2023, the Legislature allocated funding for a one-time lump-sum payment to General Employee and
Police and Fire Plan benefit recipients. Eligibility criteria and the payment amount is specified in statute.
The one-time payment is noncompounding towards future benefits.
C. Contributions
Minnesota Statutes, Chapter 353 sets the rates for employer and employee contributions. Contribution
rates can only be modified by the State Legislature.
1. GERF Contributions
Coordinated Plan members were required to contribute 6.50 percent of their annual covered
salary in fiscal year 2023, and the City was required to contribute 7.50 percent for Coordinated
Plan members. The City’s contributions to the GERF for the year ended December 31, 2023,
were $396,285. The City’s contributions were equal to the required contributions as set by state
statutes.
2. PEPFF Contributions
PEPFF Plan members were required to contribute 11.80 percent of their annual covered salary in
fiscal year 2023, and the City was required to contribute 17.70 percent for Police and Fire Plan
members. The City’s contributions to the PEPFF for the year ended December 31, 2023, were
$560,404. The City’s contributions were equal to the required contributions as set by state
statutes.
Page 186 of 352
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
D. Pension Costs
1. GERF Pension Costs
At December 31, 2023, the City reported a liability of $3,707,422 for its proportionate share of
the GERF’s net pension liability. The City’s net pension liability reflected a reduction, due to the
state of Minnesota’s contribution of $16.0 million. The state of Minnesota is considered a
nonemployer 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 $102,159. The net pension liability was measured as of June 30,
2023, and the total pension liability used to calculate the net pension liability wa s determined by
an actuarial valuation as of that date. The City’s proportionate share of the net pension liability
was based on the City’s contributions received by the PERA during the measurement period for
employer payroll paid dates from July 1, 2022 through June 30, 2023, relative to the total
employer contributions received from all of the PERA’s participating employers. The City’s
proportionate share was 0.0663 percent at the end of the measurement period and 0.0656 percent
for the beginning of the period.
The amount recognized by the City as its proportionate share of the net pension liability, the
direct aid, and total portion of the net pension liability that was associated with the City were as
follows:
City’s proportionate share of the net pension liability 3,707,422$
State’s proportionate share of the net pension liability
associated with the City 102,159
Total 3,809,581$
For the year ended December 31, 2023, the City recognized pension expense of $629,004 for its
proportionate share of the GERF’s pension expense. In addition, the City recognized an
additional $459 as pension expense (and grant revenue) for its proportionate share of the state of
Minnesota’s contribution of $16.0 million to the GERF.
At December 31, 2023, the City reported its proportionate share of the GERF’s deferred outflows
of resources and deferred inflows of resources related to pensions from the following sources:
Deferred Deferred
Outflows Inflows
of Resources of Resources
Differences between expected and actual economic experience 121,445$ 25,925$
Changes in actuarial assumptions 608,618 1,016,173
Net collective difference between projected and actual
investment earnings – 175,455
Changes in proportion 73,057 36,297
Contributions paid to the PERA subsequent to the
measurement date 197,840 –
Total 1,000,960$ 1,253,850$
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
A total of $197,840 reported as deferred outflows of resources related to pensions resulting from
city contributions subsequent to the measurement date will be recognized as a reduction of the net
pension liability in the year ending December 31, 2024. Other amounts reported as deferred
outflows and deferred inflows of resources related to pensions will be recognized in pension
expense as follows:
Pension
Year Ending Expense
December 31,Amount
2024 109,610$
2025 (575,322)$
2026 95,406$
2027 (80,424)$
2. PEPFF Pension Costs
At December 31, 2023, the City reported a liability of $4,241,193 for its proportionate share of
the PEPFF’s net pension liability. The net pension liability was measured as of June 30, 2023,
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 the PERA during the measurement period for
employer payroll paid dates from July 1, 2022 through June 30, 2023, relative to the total
employer contributions received from all of the PERA’s participating employers. The City’s
proportionate share was 0.2456 percent at the end of the measurement period and 0.2474 percent
for the beginning of the period.
The state of Minnesota contributed $18.0 million to the PEPFF in the plan fiscal year ended
June 30, 2023. The contribution consisted of $9.0 million in direct state aid that meets the
definition of a special funding situation and $9.0 million in supplemental state aid that does not
meet the definition of a special funding situation. The $9.0 million direct state aid was paid on
October 1, 2022. Thereafter, by October 1 of each year, the state will pay $9.0 million to the
PEPFF until full funding is reached or July 1, 2048, whichever is earlier. The $9.0 million in
supplemental state aid will continue until the fund is 90.0 percent funded, or until the State Patrol
Plan (administered by the Minnesota State Retirement System) is 90.0 percent funded, whichever
occurs later. The state of Minnesota’s proportionate share of the net pension liability associated
with the City totaled $170,843.
The amount recognized by the City as its proportionate share of the net pension liability, the
direct aid, and total portion of the net pension liability that was associated with the City were as
follows:
City’s proportionate share of the net pension liability 4,241,193$
State’s proportionate share of the net pension liability
associated with the City 170,843
Total 4,412,036$
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
The state of Minnesota is included as a nonemployer 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 $9.0 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, 2023,
the City recognized pension expense of $1,258,870 for its proportionate share of the Police and
Fire Plan’s pension expense. The City recognized $10,290 as a reduction of grant revenue and
pension expense for its proportionate share of the state of Minnesota’s pension expense for the
contribution of $9.0 million to the PEPFF.
The state of Minnesota is not included as a nonemployer contributing entity in the Police and Fire
Pension Plan pension allocation schedules for the $9.0 million in supplemental state aid. The City
recognized $22,104 for the year ended December 31, 2023 as revenue and an offsetting reduction
of net pension liability for its proportionate share of the state of Minnesota’s on-behalf
contributions to the PEPFF.
At December 31, 2023, the City reported its proportionate share of the PEPFF’s deferred outflows
of resources and deferred inflows of resources related to pensions from the following sources:
Deferred Deferred
Outflows Inflows
of Resources of Resources
Differences between expected and actual economic experience 1,169,756$ –$
Changes in actuarial assumptions 4,931,764 5,962,538
Net collective difference between projected and actual
investment earnings – 174,679
Changes in proportion 61,381 65,277
Contributions paid to the PERA subsequent to the
measurement date 290,947 –
Total 6,453,848$ 6,202,494$
A total of $290,947 reported as deferred outflows of resources related to pensions resulting from
city contributions subsequent to the measurement date that will be recognized as a reduction of
the net pension liability in the year ending December 31, 2024. Other amounts reported as
deferred outflows and deferred inflows of resources related to pensions will be recognized in
pension expense as follows:
Pension
Year Ending Expense
December 31,Amount
2024 212,956$
2025 63,153$
2026 1,034,611$
2027 (284,988)$
2028 (1,065,325)$
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
E. Long-Term Expected Return on Investments
The Minnesota State Board of Investment, which manages the investments of the 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
Domestic equity 33.50 %5.10 %
International equity 16.50 5.30 %
Fixed income 25.00 0.75 %
Private markets 25.00 5.90 %
Total 100.00 %
Long-Term Expected
Allocation
Target
Real Rate of Return
F. Actuarial Methods and Assumptions
The total pension liability in the June 30, 2023, 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 7.00 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 i nvestment
return of 7.00 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 the Police and Fire Plan.
Benefit increases after retirement are assumed to be 1.25 percent for the General Employees Plan and
1.00 percent for the Police and Fire Plan.
Salary growth assumptions in the General Employees Plan range in annual increments from 10.25 percent
after one year of service to 3.00 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 3.00 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 are based on the Pub-2010 Public Safety Employee
Mortality tables. The tables are adjusted slightly to fit the PERA’s experience.
Actuarial assumptions for the General Employees Plan are reviewed every four years. The most recent
four-year experience study for the General Employees Plan was completed in 2022. The assumption
changes were adopted by the Board and became effective with the July 1, 2023 actuarial valuation. The
most recent four-year experience study for the Police and Fire Plan was completed in 2020, adopted by
the Board, and became effective with the July 1, 2021 actuarial valuation.
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
The following changes in actuarial assumptions and plan provisions occurred in 2023:
1. GERF
CHANGES IN ACTUARIAL ASSUMPTIONS
• The investment return assumption and single discount rate were changed from 6.50 percent to
7.00 percent.
CHANGES IN PLAN PROVISIONS
• An additional one-time direct state aid contribution of $170.1 million will be contributed to
the Plan on October 1, 2023.
• The vesting period of those hired after June 30, 2010, was changed from five years of
allowable service to three years of allowable service.
• The benefit increase delay for early retirements on or after January 1, 2024, was eliminated.
• A one-time, noncompounding benefit increase of 2.50 percent minus the actual 2024
adjustment will be payable in a lump sum for calendar year 2024 by March 31, 2024.
2. PEPFF
CHANGES IN ACTUARIAL ASSUMPTIONS
• The investment return assumption was changed from 6.50 percent to 7.00 percent.
• The single discount rate changed from 5.40 percent to 7.00 percent.
CHANGES IN PLAN PROVISIONS
• Additional one-time direct state aid contribution of $19.4 million will be contributed to the
Plan on October 1, 2023.
• Vesting requirement for new hires after June 30, 2014, was changed from a graded 20 -year
vesting schedule to a graded 10-year vesting schedule, with 50.00 percent vesting after
five years, increasing incrementally to 100.00 percent after 10 years.
• A one-time, noncompounding benefit increase of 3.00 percent will be payable in a lump sum
for calendar year 2024 by March 31, 2024.
• Psychological treatment is required effective July 1, 2023, prior to approval for a duty
disability benefit for a psychological condition relating to the member’s occupation.
• The total and permanent duty disability benefit was increased, effective July 1, 2023.
G. Discount Rate
The discount rate used to measure the total pension liability in 2023 was 7.00 percent. The projection of
cash flows used to determine the discount rate assumed that contributions from plan members and
employers will be made at rates set in Minnesota Statutes. Based on these assumptions, the fiduciary net
position of the General Employees Fund and the Police and Fire Fund were projected to be available to
make all projected future benefit payments of current plan members. Therefore, the long-term expected
rate of return on pension plan investments was applied to all periods of projected benefit payments to
determine the total pension liability.
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NOTE 8 – DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED)
H. Pension Liability Sensitivity
The following table presents the City’s proportionate share of the net pension liability for all plans it
participates in, calculated using the discount rate disclosed on the preceding page, as well as what the
City’s proportionate share of the net pension liability would be if it were calculated using a discount rate
1 percentage point lower or 1 percentage point higher than the current discount rate:
City’s proportionate share of
the GERF net pension liability
City’s proportionate share of
the PEPFF net pension liability
1% Decrease in
(6.00%)
1% Increase in
Discount Rate
Current
Discount RateDiscount Rate
(7.00%)(8.00%)
1,362,115$
8,415,032$ 809,738$
6,558,727$
4,241,193$
3,707,422$
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 9 – DEFINED BENEFIT PENSION PLAN – FIRE RELIEF ASSOCIATION
A. Plan Description
Volunteer firefighters of the Farmington Volunteer Fire Department (the Department) are members of the
Association, which administers a single-employer defined benefit pension plan established to provide
benefits for its members. The plan is established and administered in accordance with Minnesota Statutes,
Chapter 69. The Association is governed by a Board of nine trustees; six voting trustees elected by the
members of the Association, and the City’s mayor, city administrator, and fire chief as ex officio
members. As of December 31, 2022, the plan covered 50 active firefighters and 12 vested terminated
firefighters whose pension benefits are deferred. The Association maintains a separate Special Fund to
accumulate assets to fund the retirement benefits earned by the Department’s membership.
B. Benefits Provided
A firefighter who completes at least 20 years as an active member of the Department is entitled, after
age 50, to a full service pension upon retirement equivalent to $8,500 per year of service.
The bylaws of the Association also provide for an early vested service pension for a retiring member who
has completed fewer than 20 years of service. The reduced pension, available to members with 10 years
of service, shall be equal to 60 percent of the pension as described by the bylaws. This percentage
increases 4 percent per year, so that at 20 years of service, the full amount prescribed is paid. Members
who retire with less than 20 years of service and have reached the age of 50 and have completed at least
10 years of active membership, are entitled to a reduced service pension not to exceed the amount
calculated by multiplying the member’s service pension for the completed years of service times the
applicable nonforfeitable percentage of pension.
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NOTE 9 – DEFINED BENEFIT PENSION PLAN – FIRE RELIEF ASSOCIATION
(CONTINUED)
C. Contributions
Minnesota Statutes, Chapters 424 and 424A authorize pension benefits for volunteer fire relief
associations. The plan is funded by fire state aid, investment earnings, and, if necessary, employer
contributions as specified in Minnesota Statutes and voluntary city contributions (if applicable). The
firefighters have no obligation to contribute to the plan. Nonemployer pension contributions include state
aid from the state of Minnesota and municipal contributions from the City. On-behalf of state aid
payments from the state of Minnesota are received initially by the City and subsequently remitted to the
Association. These on-behalf of state aid payments, in addition to the City’s municipal contribution
payments to the Association plan, are recognized as revenues and expenditures in the City’s General Fund
during the period received.
The state of Minnesota contributed $210,460 in fire state aid to the plan on behalf of the Department for
the year ended December 31, 2023, which was recorded as revenue. Required employer contributions are
calculated annually based on statutory provisions. The City’s statutorily-required contributions to the plan
for the year ended December 31, 2023 were $0; however, the City made a voluntary contribution of
$150,000 to the plan.
D. Pension Costs
At December 31, 2023, the City reported a net pension liability (asset) of ($1,536,553) for the plan. The
net pension liability (asset) was measured as of December 31, 2022. The total pension liability used to
calculate the net pension liability (asset) in accordance with GASB Statement No. 68 was determined by
applying an actuarial formula to specific census data certified by the Department as of December 31,
2022.
The following table presents the changes in net pension liability (asset) during the year:
Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability (Asset)
(a)(b)(a-b)
Beginning balance 2,693,997$ 4,408,102$ (1,714,105)$
Changes for the year
Service cost 218,873 – 218,873
Interest 149,757 – 149,757
Difference between expected and actual experience (425,928) – (425,928)
Changes of assumptions (11,048) – (11,048)
Contributions (state and local)– 337,645 (337,645)
Net investment income – (566,313) 566,313
Benefit payments (120,699) (120,699) –
Administrative costs – (17,230) 17,230
Total net changes (189,045) (366,597) 177,552
Ending balance 2,504,952$ 4,041,505$ (1,536,553)$
For the year ended December 31, 2023, the City recognized pension revenue of $187,645 and pension
expense of $205,963.
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NOTE 9 – DEFINED BENEFIT PENSION PLAN – FIRE RELIEF ASSOCIATION
(CONTINUED)
At December 31, 2023, the City reported deferred inflows of resources and deferred outflows of resources
related to pensions from the following sources:
Deferred Deferred
Outflows Inflows
of Resources of Resources
Difference between expected and actual liability –$ 440,564$
Change of assumptions 135,788 16,410
Net difference between projected and actual earnings on
plan investments 355,029 –
City contributions subsequent to the measurement date 150,000 –
State aid to the City subsequent to the measurement date 210,460 210,460
Total 851,277$ 667,434$
Deferred outflows of resources totaling $360,460 related to pensions resulting from city contributions to
the plan subsequent to the measurement date will be recognized as a reduction of the net pension liability
in the year ending December 31, 2024. Deferred inflows of resources totaling $210,460 related to state
aid received subsequent to the measurement date will be recognized for its impact on the net pension
liability in the year ending December 31, 2024. Other amounts reported as deferred outflows and inflows
of resources related to the plan will be recognized in pension expense as follows:
Pension
Year Ending Expense
December 31,Amount
2024 (17,397)$
2025 54,089$
2026 92,220$
2027 126,373$
2028 (32,085)$
Thereafter (189,357)$
E. Actuarial Methods and Assumptions
The total pension liability (asset) at year-end was determined using the entry-age normal actuarial cost
method and the following actuarial assumptions:
Retirement eligibility at 100 percent service pension at age 50 with 20 years of service,
early vested retirement at age 50 with 10 years of service vested at 60 percent and
increased by 4 percent for each additional year of service up to 20 and eligibility for
deferred service pension payable at age 50 with 20 years of service.
Inflation rate – 2.50% per year
Investment rate of return – 5.25%
20-year municipal bond yield – 4.05%
Actuarial assumption changes since the prior valuation included an inflation rate assumption update from
2.25 percent to 2.50 percent. Mortality, disability, and withdrawal assumptions were also changed to
those used in the most recent Minnesota PERA Police and Fire Plan actuarial valuation.
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NOTE 9 – DEFINED BENEFIT PENSION PLAN – FIRE RELIEF ASSOCIATION
(CONTINUED)
The 5.25 percent long-term expected rate of return on pension plan investments was determined using a
building-block method in which best-estimates for expected future real rates of return (expected returns,
net of inflation) were developed for each asset class us ing the plan’s target investment allocation, along
with long-term return expectations by asset class. Inflation expectations were applied to derive the
nominal rate of return for the portfolio.
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
Domestic equity 65.74 %4.10 %6.60 %
International equity 9.84 4.64 %7.14 %
Fixed income – 1.05 %3.55 %
Real estate and alternatives 4.90 3.54 %6.04 %
Cash and equivalents 19.52 (0.45) %2.05 %
Total 100.00 %5.25 %
Long-Term
Expected Nominal
Rate of Return
Long-Term
Target Expected Real
Allocation Rate of Return
F. Discount Rate
The discount rate used to measure the total pension liability was 5.25 percent. The projection of cash
flows used to determine the discount rate assumed that contributions to the plan will be made as specified
in state statutes. Based on that assumption and considering the funding ratio of the plan, the fiduciary net
position was projected to be available to make all projected future benefit payments of current active and
inactive 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.
G. Pension Liability (Asset) Sensitivity
The following presents the City’s net pension liability (asset) for the plan, calculated using the discount
rate disclosed in the preceding paragraph, as well as what the City’s net pension liability (asset) would be
if it were calculated using a discount rate 1 percent lower or higher than the current discount rate:
1% Decrease in Current 1% Increase in
Discount Rate Discount Rate Discount Rate
(4.25%)(5.25%)(6.25%)
Net pension liability (asset)(1,400,353)$ (1,536,553)$ (1,665,339)$
H. Pension Plan Fiduciary Net Position
The Association issues a publicly available financial report that includes financial statements and required
supplementary information. The report may be obtained by writing to the Farmington Fire Fighters’
Relief Association, 430 Third Street, Farmington, Minnesota 55024, or by calling (651) 280-6953.
Page 195 of 352
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NOTE 10 – OTHER POST-EMPLOYMENT BENEFITS (OPEB) PLAN
A. Plan Description
The City provides post-employment insurance benefits to certain eligible employees through its
OPEB Plan, a single-employer defined benefit plan administered by the City. All post-employment
benefits are based on contractual agreements with employee groups. Eligibility for these benefits is based
on years of service and/or minimum age requirements. These contractual agreements do not include any
specific contribution or funding requirements. The Plan does not issue a publicly available financial
report. No plan assets are accumulated in a trust that meets the criteria in paragraph 4 of GASB Statement
No. 75.
B. Benefits Provided
All retirees of the City upon retirement have the option under state law to continue their medical
insurance coverage through the City. For members of certain employee groups, the City pays for all or
part of the eligible retiree’s premiums for medical and/or dental insurance from the time of retirement
until the employee reaches the age of eligibility for Medicare. Benefits paid by the City differ by
bargaining unit and date of hire, with some contracts specifying a certain dollar amount per month, and
some covering premium costs as defined within each collective bargaining agreement. Retirees not
eligible for these city-paid premium benefits must pay the full city premium rate for their coverage.
The City is legally required to include any retirees for whom it provides health insurance coverage in the
same insurance pool as its active employees until the retiree reaches Medicare eligibility, whether the
premiums are paid by the City or the retiree. Consequently, participating retirees are considered to receive
a secondary benefit known as an “implicit rate subsidy.” This benefit relates to the assumption that the
retiree is receiving a more favorable premium rate than they would otherwise be able to obtain if
purchasing insurance on their own, due to being included in the same pool with the City’s younger and
statistically healthier active employees.
For police officers or firefighters disabled in the line-of-duty, Minnesota Statutes require the City to
continue payment of the employer’s contribution toward health coverage for the police officer or
firefighter and their spouse, if the spouse was covered at the time of disability, until age 65.
C. Contributions
The required contribution is based on projected pay-as-you-go financing requirements, with additional
amounts to prefund benefits as determined periodically by the City. The City’s current year required
pay-as-you-go contributions to finance the benefits described in the previous section totaled $35,345.
D. Membership
Membership in the plan consisted of the following as of the latest actuarial valuation:
Retirees and beneficiaries receiving benefits 11
Active plan members 74
Total members 85
E. Total OPEB Liability of the City
The City’s total OPEB liability of $1,092,823 as of year-end was measured as of December 31, 2022, and
was determined by an actuarial valuation as of December 31, 2022.
Page 196 of 352
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NOTE 10 – OTHER POST-EMPLOYMENT BENEFITS (OPEB) PLAN (CONTINUED)
F. Actuarial Methods and Assumptions
The total OPEB liability was determined using the entry-age normal cost method. Liability gains and
losses and plan changes are recognized immediately, in accordance with GASB Statement No. 75
Alternative Measurement Method requirements. The following actuarial assumptions applied to all
periods included in the measurement, unless otherwise specified:
Discount rate 4.05%
20-year municipal bond yield 4.05%
Inflation rate 2.60%
Healthcare trend rate 8.00% grading to 4.04% over 52 years
The actuarial assumptions used in the latest 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.
Since the plan is not funded by an irrevocable trust, the discount rate is equal to the 20-year municipal
bond yield rate of 4.05 percent, which was set by considering published rate information for 20-year high
quality, tax-exempt, general obligation municipal bonds as of the measurement date.
Withdrawal rates, retirement rates, mortality rates, and salary scale were based on the July 1, 2014
through June 30, 2018 PERA experience studies.
Assumption changes since the prior measurement date include the following:
• Medical trend was updated based on recently published trend model and trend surveys to better
reflect future anticipated experience.
• Medical per capita claims tables were updated based on recent experience and demographics.
• The discount rate was updated from 2.06 percent to 4.05 percent based on recent muni cipal bond
index rates.
• Membership participation was updated from 65.00 percent to 50.00 percent based on experience
and demographics.
G. Changes in the Total OPEB Liability
Total OPEB
Liability
Beginning balance – January 1, 2023 1,263,701$
Changes for the year
Service cost 121,679
Interest 27,861
Differences between expected and actual experience 141,132
Changes of assumptions (395,696)
Benefit payments – employer-financed (65,854)
Total net changes (170,878)
Ending balance – December 31, 2023 1,092,823$
Page 197 of 352
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NOTE 10 – OTHER POST-EMPLOYMENT BENEFITS (OPEB) PLAN (CONTINUED)
H. Total OPEB Liability Sensitivity to Discount and Healthcare Cost Trend Rate Changes
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 or 1 percentage point
higher than the current discount rate:
OPEB discount rate
Total OPEB liability $ 1,183,800 $ 1,007,824
3.05%5.05%
1% Decrease in 1% Increase in
Discount Rate Discount Rate
Current
Discount Rate
$ 1,092,823
4.05%
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 healthcare cost trend rates that are 1 percentage point lower or
1 percentage point higher than the current healthcare trend rates:
OPEB healthcare trend rate
Total OPEB liability $ 962,803 $ 1,244,954
3.04% over 52 years 5.04% over 52 years
1% Decrease in 1% Increase in
Healthcare Trend Rate Healthcare Trend Rate
7.00% decreasing to 9.00% decreasing to
Current
Healthcare Trend Rate
8.00% decreasing to
4.04% over 52 years
$ 1,092,823
I. OPEB Expense and Related Deferred Outflows of Resources and Deferred Inflows of Resources
For the current year, the City recognized negative OPEB expense of $105,024. As of year-end, the City
reported deferred outflows of resources and deferred inflows of resources related to OPEB from the
following sources:
Deferred Deferred
Outflows Inflows
of Resources of Resources
Contributions subsequent to the measurement date 35,345$ –$
Deferred outflows of resources reported $35,345 related to OPEB resulting from city contributions
subsequent to the measurement date that will be recognized as a reduction of the total OPEB liability in
the year ending December 31, 2024.
NOTE 11 – DEFICIT FUND BALANCES
At December 31, 2023, the Federal Aid Special Revenue Fund reported a deficit fund balance of $7,246,
the (nonmajor) K-9 Special Revenue Fund reported a deficit fund balance of $159, the (nonmajor) Akin
Street Reconstruction Capital Projects Fund reported a deficit fund balance of $132,740, the (nonmajor)
Spruce Street Reconstruction Capital Projects Fund reported a deficit fund balance of $209,989, the
(nonmajor) 2024 Street Improvements Capital Projects Fund reported a deficit fund balance of $65,283,
and the Emerald Ash Borer Capital Projects Fund reported a deficit fund balance of $17,975. These
deficits are generally due to project or other expenditures incurred in advance of funding, and will be
eliminated through future revenues and other financing sources.
Page 198 of 352
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NOTE 12 – NET POSITION/FUND BALANCES
A. Net Investment in Capital Assets
The government-wide Statement of Net Position at December 31, 2023 includes the City’s net investment
in capital assets, calculated as follows:
Governmental Business-Type
Activities Activities Total
Net investment in capital assets
Capital assets, net 49,003,064$ 49,830,438$ 98,833,502$
Less capital-related long-term debt outstanding (10,356,086) (1,344,328) (11,700,414)
Add unused bond proceeds 490,232 – 490,232
Total net investment in capital assets 39,137,210$ 48,486,110$ 87,623,320$
B. Governmental Fund Balance Classifications
At December 31, 2023, the City had the following governmental fund balances:
Special
Revenue –Storm Water Debt Service –
General Federal Aid Private Trunk Closed Bond Nonmajor Total
Nonspendable
Prepaid items 1,169$ 14,714$ –$ –$ –$ –$ 15,883$
Restricted
Economic development – – – – – 374,938 374,938
Public safety programs – – – – – 1,099,845 1,099,845
Park improvements – – – – – 1,100,850 1,100,850
PEG fees – – – – – 211,660 211,660
Recreational capital
projects – – – – – 119,944 119,944
Debt service – – – – – 2,100,445 2,100,445
Total restricted – – – – – 5,007,682 5,007,682
Committed
Improvement projects – – 125,825 – – 360,673 486,498
Park improvements – – – – – 270,476 270,476
Ice arena capital – – – – – 129,665 129,665
Sanitary sewer trunk – – – – – 982,918 982,918
Cable communications – – – – – 714,761 714,761
Fire capital programs – – – – – 214,026 214,026
Storm water trunk – – – 5,368,207 – – 5,368,207
Capital equipment – – – – – 697,570 697,570
Water trunk – – – – – 1,027,237 1,027,237
Parking lot projects – – – – – 523,005 523,005
Trail maintenance – – – – – 309,673 309,673
Building maintenance – – – – – 270,386 270,386
Pavement management – – – – – 2,196,601 2,196,601
Total committed – – 125,825 5,368,207 – 7,696,991 13,191,023
Assigned
Future debt payments – – – – 1,598,024 – 1,598,024
Unassigned 8,987,268 (21,960) – – – (426,146) 8,539,162
Total 8,988,437$ (7,246)$ 125,825$ 5,368,207$ 1,598,024$ 12,278,527$ 28,351,774$
Capital Projects –
C. Minimum Fund Balance Policy
The City’s policy is to maintain an unassigned fund balance in the General Fund in the range of
40.0–50.0 percent of the subsequent year’s budgeted expenditures and transfers out. At December 31,
2023, the unassigned fund balance of the General Fund was 47.6 percent of the subsequent year’s
budgeted expenditures and transfers out.
Page 199 of 352
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NOTE 13 – TAX INCREMENT PAY-AS-YOU-GO FINANCING REVENUE NOTES
On November 2, 2017, the EDA entered into a private development agreement regarding the Trident
Housing tax increment property. Reimbursements to the developer (Legacy Partners of Farmington, LLC)
for the Downtown Redevelopment Project were contemplated in the development agreement. The vehicle
used for this reimbursement is called a tax increment revenue note.
This note provides for the payment of principal, equal to the developer’s costs, plus interest at 3 percent.
Payments on the loan will be made at the lesser of the note payment or 90 percent of the actual net tax
increment received during specific years as stated in the agreement. Payments are first applied to accrued
interest and then to principal balances. The note is cancelled at the end of the agreement term, whether or
not it has been repaid. Any additional tax increments received in the years following the term are retained
by the EDA.
The City rebated $99,860 of property tax increment in the current year. The remaining principal balance
as of December 31, 2023 for this agreement was $1,095,645. This amount is not included in long-term
debt because of the nature of this note in that repayment is required only if sufficient tax increments are
received. The EDA’s position is that these are obligations to assign future and unc ertain revenue sources
and these obligations are not actual debt in-substance.
NOTE 14 – COMMITMENTS AND CONTINGENCIES
A. Federal and State Funding
Amounts recorded or receivable from federal and state agencies are subject to agency audit and
adjustment. Any disallowed claims, including amounts already collected, may constitute a liability of the
applicable funds. The amount, if any, of claims which may be disallowed by the grantor agencies cannot
be determined at this time, although the City expects such amounts, if any, to be immaterial.
B. Legal Claims
The City has the usual and customary type of miscellaneous legal claims pending at year-end. Although
the outcome of these lawsuits is not presently determinable, the City’s management believes that the City
will not incur any material monetary loss resulting from these claims. No loss has been recorded on the
City’s financial statements relating to these claims.
C. Tax Increment Districts
The City’s tax increment districts are subject to review by the Minnesota Office of the State Auditor. Any
disallowed claims or misuse of tax increments could become a liability of the applicable fund.
Management has indicated that it’s not aware of any instances of noncompliance, which would have a
material effect on the financial statements.
D. Contracts Payable
At December 31, 2023, the City is committed to various construction contracts for the improvement of
city property. The City’s remaining commitment under these contracts is approximately $717,853 at
year-end.
Page 200 of 352
REQUIRED SUPPLEMENTARY INFORMATION
Page 201 of 352
Proportionate
Share of the
City’s Net Pension
Proportionate Liability and City’s
Share of the the City’s Proportionate Plan Fiduciary
State of Share of the Share of the Net Position
City’s City’s Minnesota’s State of Net Pension as a
PERA Fiscal Proportion Proportionate Proportionate Minnesota’s Liability as a Percentage
Year-End Date of the Net Share of the Share of the Share of the City’s Percentage of of the Total
(Measurement Pension Net Pension Net Pension Net Pension Covered Covered Pension
Date)Liability Liability Liability Liability Payroll Payroll Liability
06/30/2015 0.0623% 3,228,709$ –$ 3,228,709$ 3,660,794$ 88.20% 78.20%
06/30/2016 0.0583% 4,733,671$ 61,864$ 4,795,535$ 3,618,268$ 130.83% 68.90%
06/30/2017 0.0597% 3,811,209$ 47,942$ 3,859,151$ 3,847,797$ 99.05% 75.90%
06/30/2018 0.0607% 3,367,387$ 110,472$ 3,477,859$ 4,034,230$ 83.47% 79.50%
06/30/2019 0.0613% 3,389,141$ 105,329$ 3,494,470$ 4,340,798$ 78.08% 80.20%
06/30/2020 0.0652% 3,909,039$ 120,522$ 4,029,561$ 4,647,499$ 84.11% 79.10%
06/30/2021 0.0673% 2,874,012$ 87,697$ 2,961,709$ 4,840,585$ 59.37% 87.00%
06/30/2022 0.0656% 5,195,542$ 152,265$ 5,347,807$ 4,915,505$ 105.70% 76.70%
06/30/2023 0.0663% 3,707,422$ 102,159$ 3,809,581$ 5,255,710$ 70.54% 83.10%
Contributions Contributions
in Relation to as a
Statutorily the Statutorily Contribution Percentage
Required Required Deficiency Covered of Covered
Contributions Contributions (Excess)Payroll Payroll
271,726$ 271,726$ –$ 3,623,009$ 7.50%
279,774$ 279,774$ –$ 3,730,581$ 7.50%
290,225$ 290,225$ –$ 3,872,895$ 7.49%
312,863$ 312,863$ –$ 4,171,664$ 7.50%
340,100$ 340,100$ –$ 4,534,664$ 7.50%
372,817$ 372,817$ –$ 4,970,884$ 7.50%
371,254$ 371,254$ –$ 4,950,057$ 7.50%
360,931$ 360,931$ –$ 4,814,017$ 7.50%
396,285$ 396,285$ –$ 5,283,820$ 7.50%
Note:
12/31/2023
12/31/2023
CITY OF FARMINGTON
PERA – General Employees Retirement Fund
PERA – General Employees Retirement Fund
Schedule of City Contributions
Year-End Date
City Fiscal
12/31/2016
12/31/2015
12/31/2017
12/31/2019
12/31/2020
12/31/2021
12/31/2022
The City implemented GASB Statement No.68 in fiscal 2015 (using a June 30,2015 measurement date).This schedule is intended to present
10-year trend information. Additional years will be added as they become available.
Year Ended December 31, 2023
Year Ended December 31, 2023
Schedule of City’s and Nonemployer Proportionate Share of Net Pension Liability
12/31/2017
Year-End Date
City Fiscal
12/31/2016
12/31/2015
12/31/2018
12/31/2018
12/31/2019
12/31/2020
12/31/2021
12/31/2022
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Page 202 of 352
Proportionate
Share of the
City’s Net Pension
Proportionate Liability and City’s
Share of the the City’s Proportionate Plan Fiduciary
State of Share of the Share of the Net Position
City’s City’s Minnesota’s State of Net Pension as a
PERA Fiscal Proportion Proportionate Proportionate Minnesota’s Liability as a Percentage
Year-End Date of the Net Share of the Share of the Share of the City’s Percentage of of the Total
(Measurement Pension Net Pension Net Pension Net Pension Covered Covered Pension
Date)Liability Liability Liability Liability Payroll Payroll Liability
06/30/2015 0.2450% 2,783,773$ –$ 2,783,773$ 2,242,616$ 124.13%86.60%
06/30/2016 0.2430% 9,752,013$ –$ 9,752,013$ 2,344,593$ 415.94%63.90%
06/30/2017 0.2370% 3,199,781$ –$ 3,199,781$ 2,431,157$ 131.62%85.40%
06/30/2018 0.2300% 2,451,563$ –$ 2,451,563$ 2,424,781$ 101.10%88.80%
06/30/2019 0.2381% 2,534,816$ –$ 2,534,816$ 2,513,262$ 100.86%89.30%
06/30/2020 0.2410% 3,176,637$ 74,843$ 3,251,480$ 2,720,577$ 116.76%87.20%
06/30/2021 0.2436% 1,880,335$ 84,551$ 1,964,886$ 2,879,369$ 65.30%93.70%
06/30/2022 0.2474% 10,765,871$ 470,299$ 11,236,170$ 3,003,762$ 358.41%70.50%
06/30/2023 0.2456% 4,241,193$ 170,843$ 4,412,036$ 3,225,401$ 131.49%86.50%
Contributions Contributions
in Relation to as a
Statutorily the Statutorily Contribution Percentage
Required Required Deficiency Covered of Covered
Contributions Contributions (Excess)Payroll Payroll
374,503$ 374,503$ –$ 2,311,741$ 16.20%
384,033$ 384,033$ –$ 2,370,262$ 16.20%
395,621$ 395,621$ –$ 2,442,894$ 16.19%
396,439$ 396,439$ –$ 2,447,155$ 16.20%
442,727$ 442,727$ –$ 2,611,958$ 16.95%
515,909$ 515,909$ –$ 2,914,733$ 17.70%
526,699$ 526,699$ –$ 2,975,703$ 17.70%
536,433$ 536,433$ –$ 3,030,694$ 17.70%
560,404$ 560,404$ –$ 3,166,126$ 17.70%
Note:
CITY OF FARMINGTON
PERA – Public Employees Police and Fire Fund
Schedule of City’s and Nonemployer Proportionate Share of Net Pension Liability
PERA – Public Employees Police and Fire Fund
Schedule of City Contributions
12/31/2016
12/31/2015
Year-End Date
City Fiscal
12/31/2017
12/31/2018
12/31/2019
12/31/2020
12/31/2021
12/31/2022
12/31/2023
12/31/2018
12/31/2019
12/31/2020
Year-End Date
The City implemented GASB Statement No.68 in fiscal 2015 (using a June 30,2015 measurement date).This schedule is intended to present
10-year trend information. Additional years will be added as they become available.
12/31/2016
12/31/2021
12/31/2022
12/31/2023
City Fiscal
Year Ended December 31, 2023
Year Ended December 31, 2023
12/31/2017
12/31/2015
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Page 203 of 352
City fiscal year-end dated December 31,2015 2016 2017 2018 2019 2020 2021 2022 2023
Farmington Fire Fighters’ Relief Association
year-end dated (measurement date)
December 31,2014 2015 2016 2017 2018 2019 2020 2021 2022
Total pension liability
Service cost 69,285$ 71,190$ 86,788$ 93,501$ 112,754$ 163,690$ 177,922$ 190,066$ 218,873$
Interest 110,249 92,788 82,702 95,308 105,418 118,151 119,981 125,065 149,757
Differences between expected
and actual experience – – (14,504) – (13,870) – (51,474) – (425,928)
Changes of assumptions – 116,780 (15,678) – 86,336 61,961 18,063 – (11,048)
Changes of benefits terms – – 143,662 171,894 169,797 – (368) 238,686 –
Benefit payments (265,643) (596,137) (1,194) (292,064) (156,771) – (254,977) (103,887) (120,699)
Net change in
total pension liability (86,109) (315,379) 281,776 68,639 303,664 343,802 9,147 449,930 (189,045)
Total pension liability
Beginning of year 1,638,527 1,552,418 1,237,039 1,518,815 1,587,454 1,891,118 2,234,920 2,244,067 2,693,997
End of year 1,552,418$ 1,237,039$ 1,518,815$ 1,587,454$ 1,891,118$ 2,234,920$ 2,244,067$ 2,693,997$ 2,504,952$
Plan fiduciary net position
Contributions (state and local)283,461$ 291,915$ 291,510$ 301,508$ 297,548$ 301,797$ 315,539$ 321,822$ 337,645$
Net investment income 84,277 (33,543) 163,457 342,985 (168,667) 508,896 366,662 419,642 (566,313)
Benefit payments (265,643) (596,137) (1,194) (292,064) (156,771) – (254,977) (103,887) (120,699)
Administrative costs (10,848) (15,756) (17,200) (18,282) (16,720) (18,400) (16,950) (18,750) (17,230)
Net change in plan
fiduciary net position 91,247 (353,521) 436,573 334,147 (44,610) 792,293 410,274 618,827 (366,597)
Plan fiduciary net position
Beginning of year 2,122,872 2,214,119 1,860,598 2,297,171 2,631,318 2,586,708 3,379,001 3,789,275 4,408,102
End of year 2,214,119$ 1,860,598$ 2,297,171$ 2,631,318$ 2,586,708$ 3,379,001$ 3,789,275$ 4,408,102$ 4,041,505$
Net pension liability (asset) – ending (661,701)$ (623,559)$ (778,356)$ (1,043,864)$ (695,590)$ (1,144,081)$ (1,545,208)$ (1,714,105)$ (1,536,553)$
Plan fiduciary net position as a
percentage of the total pension liability 142.62%150.41%151.25%165.76%136.78%151.19%168.86%163.63%161.34%
Note:
CITY OF FARMINGTON
The City implemented GASB Statement No. 68 in fiscal 2015 (using a December 31, 2014 measurement date). This information is not available for previous fiscal years.
Year Ended December 31, 2023
Net Pension Liability (Asset) and Related Ratios
Schedule of Changes in the Relief Association’s
Farmington Fire Fighters’ Relief Association
-68-
Page 204 of 352
Contributions in
Relation to the
Statutorily Statutorily Contribution Voluntary
Required Required Deficiency City
Contributions (a)Contributions (b)(Excess) (a-b)Contribution
–$ –$ –$ 150,000$
–$ –$ –$ 150,000$
–$ –$ –$ 150,000$
–$ –$ –$ 150,000$
–$ –$ –$ 150,000$
–$ –$ –$ 150,000$
–$ –$ –$ 150,000$
–$ –$ –$ 150,000$
–$ –$ –$ 150,000$
Note:
12/31/2023
The City implemented GASB Statement No.68 in fiscal 2015 (using a December 31,2014 measurement date).This
information is not available for previous fiscal years.
Schedule of City Contributions
Farmington Fire Fighters’ Relief Association
CITY OF FARMINGTON
City Fiscal
Year-End Date
12/31/2017
12/31/2015
12/31/2016
12/31/2018
12/31/2019
12/31/2020
12/31/2021
Year Ended December 31, 2023
12/31/2022
-69-
Page 205 of 352
2018 2019 2020 2021 2022 2023
Total OPEB liability
Service cost 113,275$ 85,451$ 74,564$ 92,066$ 114,711$ 121,679$
Interest 40,190 40,509 49,025 26,170 26,625 27,861
Differences between expected
and actual experience – – (424,559) 489,862 3,834 141,132
Changes of assumptions 28,356 (57,133) 79,584 (278,274) 6,058 (395,696)
Benefit payments (38,891) (40,361) (33,373) (45,998) (57,384) (65,854)
Net change in total OPEB liability 142,930 28,466 (254,759) 283,826 93,844 (170,878)
Total OPEB liability – beginning of year 969,394 1,112,324 1,140,790 886,031 1,169,857 1,263,701
Total OPEB liability – end of year 1,112,324$ 1,140,790$ 886,031$ 1,169,857$ 1,263,701$ 1,092,823$
Covered-employee payroll 5,800,000$ 6,000,000$ 7,300,000$ 7,300,000$ 8,600,000$ 9,200,000$
Total OPEB liability as a percentage
of covered-employee payroll 19.18% 19.01% 12.14% 16.03% 14.69% 11.88%
Note 1:
Note: 2:The City implemented GASB Statement No.75 in fiscal 2018.This schedule is intended to present 10-year trend information.
Additional years will be added as they become available.
The City has not established a trust fund to finance GASB Statement No. 75 related benefits.
Fiscal Year
Year Ended December 31, 2023
CITY OF FARMINGTON
Other Post-Employment Benefits Plan
Schedule of Changes in the City’s Total
OPEB Liability and Related Ratios
-70-
Page 206 of 352
CITY OF FARMINGTON
Notes to Required Supplementary Information
December 31, 2023
-71-
PERA – GENERAL EMPLOYEES RETIREMENT FUND
2023 CHANGES IN ACTUARIAL ASSUMPTIONS
• The investment return assumption and single discount rate were changed from 6.50 percent to
7.00 percent.
2023 CHANGES IN PLAN PROVISIONS
• An additional one-time direct state aid contribution of $170.1 million will be contributed to the
Plan on October 1, 2023.
• The vesting period of those hired after June 30, 2010, was changed from five years of allowable
service to three years of allowable service.
• The benefit increase delay for early retirements on or after January 1, 2024, was eliminated. • A one-time, noncompounding benefit increase of 2.50 percent minus the actual
2024 adjustment will be payable in a lump sum for calendar year 2024 by March 31, 2024.
2022 CHANGES IN ACTUARIAL ASSUMPTIONS
• The mortality improvement scale was changed from Scale MP-2020 to Scale MP-2021.
2021 CHANGES IN ACTUARIAL ASSUMPTIONS
• 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 CHANGES IN ACTUARIAL ASSUMPTIONS
• The price inflation assumption was decreased from 2.50 percent to 2.25 percent.
• The payroll growth assumption was decreased from 3.25 percent to 3.00 percent.
• 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 percent 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 two through five, 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 MP-2018 to 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 100.00 percent joint and
survivor option changed from 35.00 percent to 45.00 percent. The assumed number of married
female new retirees electing the 100.00 percent joint and survivor option changed from
15.00 percent to 30.00 percent. The corresponding number of married new retirees electing the
life annuity option was adjusted accordingly.
Page 207 of 352
CITY OF FARMINGTON
Notes to Required Supplementary Information (continued)
December 31, 2023
-72-
PERA – GENERAL EMPLOYEES RETIREMENT FUND (CONTINUED)
2020 CHANGES IN PLAN PROVISIONS
• Augmentation for current privatized members was reduced to 2.00 percent for the period July 1,
2020 through December 31, 2023, and zero percent thereafter. Augmentation was eliminated
for privatizations occurring after June 30, 2020.
2019 CHANGES IN ACTUARIAL ASSUMPTIONS
• The mortality projection scale was changed from MP-2017 to MP-2018.
2019 CHANGES IN PLAN PROVISIONS
• 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 CHANGES IN ACTUARIAL ASSUMPTIONS
• 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.
2018 CHANGES IN PLAN PROVISIONS
• 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 zero percent, effective January 1, 2019. Augmentation
that has already accrued for deferred members will still apply.
• Contribution stabilizer provisions were repealed.
• Post-retirement 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.
Page 208 of 352
CITY OF FARMINGTON
Notes to Required Supplementary Information (continued)
December 31, 2023
-73-
PERA – GENERAL EMPLOYEES RETIREMENT FUND (CONTINUED)
2017 CHANGES IN ACTUARIAL ASSUMPTIONS
• The Combined Service Annuity (CSA) loads were changed from 0.80 percent for active
members and 60.00 percent for vested and nonvested deferred members. The revised CSA
loads are now zero percent for active member liability, 15.00 percent for vested deferred
member liability, and 3.00 percent for nonvested deferred member liability.
• The assumed post-retirement benefit increase rate was changed from 1.00 percent per year for
all years, to 1.00 percent per year through 2044, and 2.50 percent per year thereafter.
2017 CHANGES IN PLAN PROVISIONS
• The state’s contribution for the Minneapolis Employees Retirement Fund equals $16.0 million
in 2017 and 2018, and $6.0 million thereafter.
• The Employer Supplemental Contribution for the Minneapolis Employees Retirement Fund
changed from $21.0 million to $31.0 million in calendar years 2019 to 2031. The state’s
contribution changed from $16.0 million to $6.0 million in calendar years 2019 to 2031.
2016 CHANGES IN ACTUARIAL ASSUMPTIONS
• The assumed post-retirement benefit increase rate was changed from 1.00 percent per year
through 2035 and 2.50 percent per year thereafter, to 1.00 percent per year for all years.
• The assumed investment return was changed from 7.90 percent to 7.50 percent. The single
discount rate changed from 7.90 percent to 7.50 percent.
• Other assumptions were changed pursuant to the experience study 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 CHANGES IN ACTUARIAL ASSUMPTIONS
• The assumed post-retirement benefit increase rate was changed from 1.00 percent per year
through 2030 and 2.50 percent per year thereafter, to 1.00 percent per year through 2035, and
2.50 percent per year thereafter.
2015 CHANGES IN PLAN PROVISIONS
• 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 $892.0 million. Upon consolidation, state and employer
contributions were revised; the state’s contribution of $6.0 million, which meets the special
funding situation definition, was due September 2015.
Page 209 of 352
CITY OF FARMINGTON
Notes to Required Supplementary Information (continued)
December 31, 2023
-74-
PERA – PUBLIC EMPLOYEES POLICE AND FIRE FUND
2023 CHANGES IN ACTUARIAL ASSUMPTIONS
• The investment return assumption was changed from 6.50 percent to 7.00 percent.
• The single discount rate changed from 5.40 percent to 7.00 percent.
2023 CHANGES IN PLAN PROVISIONS
• Additional one-time direct state aid contribution of $19.4 million will be contributed to the
Plan on October 1, 2023.
• Vesting requirement for new hires after June 30, 2014, was changed from a graded 20-year
vesting schedule to a graded 10-year vesting schedule, with 50.00 percent vesting after
five years, increasing incrementally to 100.00 percent after 10 years.
• A one-time, noncompounding benefit increase of 3.00 percent will be payable in a lump sum
for calendar year 2024 by March 31, 2024.
• Psychological treatment is required effective July 1, 2023, prior to approval for a duty disability
benefit for a psychological condition relating to the member’s occupation.
• The total and permanent duty disability benefit was increased, effective July 1, 2023.
2022 CHANGES IN ACTUARIAL ASSUMPTIONS
• The mortality improvement scale was changed from Scale MP-2020 to Scale MP-2021.
• This single discount rate changed from 6.50 percent to 5.40 percent.
2021 CHANGES IN ACTUARIAL ASSUMPTIONS
• 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 MP-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 recommended 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, 20 20 experience
study. The changes result in slightly more unreduced retirements 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 60.00 percent to
70.00 percent. Minor changes to form of payment assumptions were applied.
Page 210 of 352
CITY OF FARMINGTON
Notes to Required Supplementary Information (continued)
December 31, 2023
-75-
PERA – PUBLIC EMPLOYEES POLICE AND FIRE FUND (CONTINUED)
2020 CHANGES IN ACTUARIAL ASSUMPTIONS
• The mortality projection scale was changed from MP-2018 to MP-2019.
2019 CHANGES IN ACTUARIAL ASSUMPTIONS
• The mortality projection scale was changed from MP-2017 to MP-2018.
2018 CHANGES IN ACTUARIAL ASSUMPTIONS
• The mortality projection scale was changed from MP-2016 to MP-2017.
2018 CHANGES IN PLAN PROVISIONS
• Post-retirement benefit increases were changed to 1.00 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 100.00 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 zero 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.
Page 211 of 352
CITY OF FARMINGTON
Notes to Required Supplementary Information (continued)
December 31, 2023
-76-
PERA – PUBLIC EMPLOYEES POLICE AND FIRE FUND (CONTINUED)
2017 CHANGES IN ACTUARIAL ASSUMPTIONS
• 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 CSA load was 30.00 percent for vested and nonvested deferred members. The CSA has
been changed to 33.00 percent for vested members, and 2.00 percent for nonvested 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 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 5.60 percent per annum to 7.50 percent per annum.
2016 CHANGES IN ACTUARIAL ASSUMPTIONS
• The assumed post-retirement benefit increase rate was changed from 1.00 percent per year
through 2037, and 2.50 percent per year thereafter, to 1.00 percent per year for all future years.
• The assumed investment return was changed from 7.90 percent to 7.50 percent.
• The single discount rate changed from 7.90 percent to 5.60 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 CHANGES IN ACTUARIAL ASSUMPTIONS
• The assumed post-retirement benefit increase rate was changed from 1.00 percent per year
through 2030, and 2.50 percent per year thereafter, to 1.00 percent per year through 2037, and
2.50 percent per year thereafter.
2015 CHANGES IN PLAN PROVISIONS
• The post-retirement benefit increase to be paid after attainment of the 90.00 percent funding
threshold was changed from inflation up to 2.50 percent, to a fixed rate of 2.50 percent.
Page 212 of 352
CITY OF FARMINGTON
Notes to Required Supplementary Information (continued)
December 31, 2023
-77-
FARMINGTON FIRE FIGHTERS’ RELIEF ASSOCIATION
2023 CHANGES IN ACTUARIAL ASSUMPTIONS
• The disability, mortality, and withdrawal assumptions were updated from the rates used in the
July 1, 2020 Minnesota PERA Police and Fire Plan actuarial valuation to the rates used in the
July 1, 2022 Minnesota PERA Police and Fire Plan actuarial valuation.
• The inflation rate was changed from 2.25 percent to 2.50 percent.
2022 CHANGES IN PLAN PROVISIONS
• The plan benefit level increased from $7,500 to $8,500 per year of service.
2021 CHANGES IN ACTUARIAL ASSUMPTIONS
• The disability, mortality, and withdrawal assumptions were updated from the rates used in the
July 1, 2018 Minnesota PERA Police and Fire Plan actuarial valuation to the rates used in the
July 1, 2020 Minnesota PERA Police and Fire Plan actuarial valuation.
• The inflation rate was changed from 2.50 percent to 2.25 percent.
2021 CHANGES IN PLAN PROVISIONS
• Interest earned on deferred lump sum amounts has been updated from 5.00 percent for all
members to 5.00 percent for members hired before July 1, 2019 and 2.00 percent for members
hired on or after July 1, 2019.
2020 CHANGES IN ACTUARIAL ASSUMPTIONS
• The actuarial assumptions for investment rate of return and the single discount rate both
changed from 5.75 percent to 5.25 percent.
2019 CHANGES IN ACTUARIAL ASSUMPTIONS
• The actuarial assumptions for investment rate of return and the single discount rate both
changed from 6.50 percent to 5.75 percent.
• The inflation rate was changed from 2.75 percent to 2.50 percent.
• The mortality and withdrawal assumptions were updated from the rates used in the July 1, 2017
Minnesota PERA Police and Fire Plan actuarial valuation to the rates used in the July 1, 2018
Minnesota PERA Police and Fire Plan actuarial valuation.
2019 CHANGES IN PLAN PROVISIONS
• The plan benefit level increased from $6,500 to $7,500 per year of service.
Page 213 of 352
CITY OF FARMINGTON
Notes to Required Supplementary Information (continued)
December 31, 2023
-78-
FARMINGTON FIRE FIGHTERS’ RELIEF ASSOCIATION (CONTINUED)
2018 CHANGES IN PLAN PROVISIONS
• The plan benefit level increased from $5,500 to $6,500 per year of service.
2017 CHANGES IN ACTUARIAL ASSUMPTIONS
• The actuarial assumptions for investment rate of return and the single discount rate both
changed from 6.25 percent to 6.50 percent.
2017 CHANGES IN PLAN PROVISIONS
• The plan benefit level increased from $4,575 to $5,500 per year of service.
2016 CHANGES IN ACTUARIAL ASSUMPTIONS
• The actuarial assumptions for the single discount rate changed from 7.00 percent to
6.25 percent.
• The retirement rates were updated to graduated rates from 50.00 percent at the later of age 50
or 20 years of service, up to 100.00 percent at the earlier of age 65 or 30 years of service.
Page 214 of 352
CITY OF FARMINGTON
Notes to Required Supplementary Information (continued)
December 31, 2023
-79-
OTHER POST-EMPLOYMENT BENEFITS PLAN
2023 CHANGES IN ACTUARIAL ASSUMPTIONS
• Medical trend was updated based on recently published trend model and trend surveys to better
reflect future anticipated experience.
• Medical per capita claims tables were updated based on recent experience and demographics.
• The discount rate was updated from 2.06 percent to 4.05 percent based on recent municipal
bond index rates.
• Membership participation was updated from 65 percent to 50 percent based on experience and
demographics.
2022 CHANGES IN ACTUARIAL ASSUMPTIONS
• The actuarial assumptions for the single discount rate changed from 2.12 percent to
2.06 percent.
2021 CHANGES IN ACTUARIAL ASSUMPTIONS
• Medical trend was updated based on recently published trend model and trend surveys to better
reflect future anticipated experience.
• Medical per capita claims tables were updated based on recent experience and demographics.
• The actuarial assumptions for the single discount rate changed from 2.74 percent to
2.12 percent.
• Withdrawal, mortality, and salary scale assumptions were updated to those included in the
recently published PERA General Plan and Police and Fire Plan actuarial valuations.
• Assumed retirement ages were updated from the PERA General Plan and Police and Fire Plan
assumptions to age 56 for Police and Fire Plan members and 63 for General Plan members.
• Assumed future retiree spouse participation was updated from 40.00 percent to current
coverage elections.
• The assumed inflation rate changed from 2.00 percent to 2.50 percent.
2020 CHANGES IN ACTUARIAL ASSUMPTIONS
• The actuarial assumptions for the single discount rate changed from 4.09 percent to
2.74 percent.
• The assumed inflation rate changed from 2.50 percent to 2.00 percent.
2019 CHANGES IN ACTUARIAL ASSUMPTIONS
• The actuarial assumptions for the single discount rate changed from 3.44 percent to
4.09 percent.
2018 CHANGES IN ACTUARIAL ASSUMPTIONS
• The actuarial assumptions for the single discount rate changed from 4.50 percent to
3.44 percent.
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SUPPLEMENTARY INFORMATION
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-80-
NONMAJOR GOVERNMENTAL FUNDS
The statements that follow are to provide further detail and support additional analysis for the City’s
nonmajor special revenue, capital projects, and debt service funds.
Page 219 of 352
Special Capital Debt Service
Revenue Projects Fund Total
Assets
Cash and investments 2,899,540$ 7,936,529$ 2,094,451$ 12,930,520$
Receivables
Accounts 141,839 41,839 – 183,678
Interest 7,556 31,095 8,643 47,294
Special assessments
Noncurrent – 420,778 – 420,778
Due from other funds – 35,379 – 35,379
Due from other governments – 416,867 – 416,867
Total assets 3,048,935$ 8,882,487$ 2,103,094$ 14,034,516$
Liabilities
Accounts and contracts payable 57,847$ 829,653$ 2,649$ 890,149$
Deposits payable 12,238 – – 12,238
Due to other governments 544 – – 544
Due to other funds 2,691 35,379 – 38,070
Total liabilities 73,320 865,032 2,649 941,001
Deferred inflows of resources
Unavailable revenue – special assessments – 420,778 – 420,778
Unavailable revenue – long-term receivable – 394,210 – 394,210
Total deferred inflows of resources – 814,988 – 814,988
Fund balances (deficits)
Restricted 2,575,633 331,604 2,100,445 5,007,682
Committed 400,141 7,296,850 – 7,696,991
Unassigned (159) (425,987) – (426,146)
Total fund balances 2,975,615 7,202,467 2,100,445 12,278,527
Total liabilities, deferred inflows
of resources, and fund balances 3,048,935$ 8,882,487$ 2,103,094$ 14,034,516$
CITY OF FARMINGTON
Nonmajor Governmental Funds
Combining Balance Sheet
as of December 31, 2023
-81-
Page 220 of 352
Special Capital Debt Service
Revenue Projects Fund Total
Revenue
Property taxes 110,955$ –$ 1,903,565$ 2,014,520$
Franchise taxes – 56,431 – 56,431
Special assessments – – 17,528 17,528
Intergovernmental 1,070,510 2,079,161 – 3,149,671
Charges for services 415,475 644,170 – 1,059,645
Investment earnings 78,753 330,738 66,534 476,025
Other
Donations 68,755 78,049 – 146,804
Rentals 13,565 – – 13,565
Miscellaneous 181,313 9,614 – 190,927
Total revenues 1,939,326 3,198,163 1,987,627 7,125,116
Expenditures
Current
General government – 119,761 – 119,761
Public safety 40,591 53,533 – 94,124
Public works – 846,936 – 846,936
Parks and recreation 546,298 96,925 – 643,223
Economic development 177,927 – – 177,927
Capital outlay
Public safety 2,195 1,205,782 – 1,207,977
Public works – 4,168,592 – 4,168,592
Parks and recreation 234,520 – – 234,520
Debt service
Principal – 81,097 1,625,000 1,706,097
Interest and fiscal charges – 18,469 370,189 388,658
Total expenditures 1,001,531 6,591,095 1,995,189 9,587,815
Excess (deficiency) of revenues
over expenditures 937,795 (3,392,932) (7,562) (2,462,699)
Other financing sources (uses)
Sale of capital assets 214 127,926 – 128,140
Leases issued – 714,239 – 714,239
Transfers in 277,212 2,121,316 – 2,398,528
Transfers out – (423,446) (1,046,942) (1,470,388)
Total other financing sources (uses)277,426 2,540,035 (1,046,942) 1,770,519
Net change in fund balances 1,215,221 (852,897) (1,054,504) (692,180)
Fund balances
Beginning of year 1,760,394 8,055,364 3,154,949 12,970,707
End of year 2,975,615$ 7,202,467$ 2,100,445$ 12,278,527$
Year Ended December 31, 2023
CITY OF FARMINGTON
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
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-83-
NONMAJOR SPECIAL REVENUE FUNDS
Nonmajor special revenue funds are used to account for the proceeds of certain specific revenue sources
that are restricted or committed to expenditures for specified purposes.
Nonmajor special revenue funds presently established are as follows:
Economic Development Authority – Used to account for the general economic development activities
of the City’s Economic Development Authority.
Dakota Broadband – Used to account for the City’s agreement with Dakota Broadband.
Trident Housing Tax Increment – Used to account for the development of this tax increment district.
Police Donations and Forfeitures – Used to account for the operations and activities related to
donations and the forfeiture of confiscated property and allows for the expenditure of those revenues
for costs related to the public safety of the City.
Police Public Outreach – Used to account for the operations and activities related to police public
outreach programs to foster positive relationships between the police department and the community.
K-9 – Used to account for the operations and activities related to K-9 program donations and allows
for the expenditure of those revenues for costs related to the City’s K-9 program.
Park Improvement – Used to account for the operations and activities related to the collection of park
dedication fees and other revenues earmarked for construction and improvement of the City’s park
and trail system.
Arena (Ice) – Used to account for the operation of the City’s ice arena; one sheet of indoor ice for use
by hockey and figure skating groups, both school and youth organizations supported.
Public Safety – Used to account for state aid restricted for public safety program purposes.
Page 223 of 352
Economic Police
Development Dakota Trident Housing Donations
Authority Broadband Tax Increment and Forfeitures
Assets
Cash and investments 275,747$ 32,392$ 119,510$ 16,824$
Receivables
Accounts – – – –
Interest 1,138 – 493 69
Total assets 276,885$ 32,392$ 120,003$ 16,893$
Liabilities
Accounts and contracts payable 1,939$ 2,340$ 50,063$ –$
Deposits payable – – – 2,999
Due to other governments – – – –
Due to other funds – – – –
Total liabilities 1,939 2,340 50,063 2,999
Fund balances (deficits)
Restricted for economic development 274,946 30,052 69,940 –
Restricted for public safety programs – – – 13,894
Restricted for park improvements – – – –
Committed for park improvements – – – –
Committed for ice arena capital – – – –
Unassigned – – – –
Total fund balances (deficits)274,946 30,052 69,940 13,894
Total liabilities and fund balances 276,885$ 32,392$ 120,003$ 16,893$
CITY OF FARMINGTON
Nonmajor Special Revenue Funds
Combining Balance Sheet
as of December 31, 2023
-84-
Page 224 of 352
Police
Public Park
Outreach K-9 Improvement Arena Public Safety Total
53,324$ 644$ 1,365,693$ 300$ 1,035,106$ 2,899,540$
– – – 141,839 – 141,839
220 3 5,633 – – 7,556
53,544$ 647$ 1,371,326$ 142,139$ 1,035,106$ 3,048,935$
2,699$ 806$ –$ –$ –$ 57,847$
– – – 9,239 – 12,238
– – – 544 – 544
– – – 2,691 – 2,691
2,699 806 – 12,474 – 73,320
– – – – – 374,938
50,845 – – – 1,035,106 1,099,845
– – 1,100,850 – – 1,100,850
– – 270,476 – – 270,476
– – – 129,665 – 129,665
– (159) – – – (159)
50,845 (159) 1,371,326 129,665 1,035,106 2,975,615
53,544$ 647$ 1,371,326$ 142,139$ 1,035,106$ 3,048,935$
-85-
Page 225 of 352
Economic Police
Development Dakota Trident Housing Donations
Authority Broadband Tax Increment and Forfeitures
Revenues
Property taxes –$ –$ 110,955$ –$
Intergovernmental – 32,904 – –
Charges for services – – – –
Investment earnings 11,382 – 3,803 733
Other
Donations – – – –
Rentals – – – –
Miscellaneous – – – –
Total revenues 11,382 32,904 114,758 733
Expenditures
Current
Public safety – – – –
Parks and recreation – – – –
Economic development 72,392 2,973 102,562 –
Capital outlay
Public safety – – – 2,195
Parks and recreation – – – –
Total expenditures 72,392 2,973 102,562 2,195
Excess (deficiency) of revenues
over expenditures (61,010) 29,931 12,196 (1,462)
Other financing sources
Sale of capital assets – – – –
Transfers in 86,969 – – –
Total other financing sources 86,969 – – –
Net change in fund balances 25,959 29,931 12,196 (1,462)
Fund balances (deficits)
Beginning of year 248,987 121 57,744 15,356
End of year 274,946$ 30,052$ 69,940$ 13,894$
CITY OF FARMINGTON
Nonmajor Special Revenue Funds
Year Ended December 31, 2023
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
-86-
Page 226 of 352
Police
Public Park
Outreach K-9 Improvement Arena Public Safety Total
–$ –$ –$ –$ –$ 110,955$
2,500 – – – 1,035,106 1,070,510
– – – 415,475 – 415,475
1,802 10 60,142 881 – 78,753
53,911 3,669 1,175 10,000 – 68,755
– – 8,560 5,005 – 13,565
– – 177,311 4,002 – 181,313
58,213 3,679 247,188 435,363 1,035,106 1,939,326
36,714 3,877 – – – 40,591
– – 67,423 478,875 – 546,298
– – – – – 177,927
– – – – – 2,195
– – 219,852 14,668 – 234,520
36,714 3,877 287,275 493,543 – 1,001,531
21,499 (198) (40,087) (58,180) 1,035,106 937,795
– 214 – – – 214
– – 100,000 90,243 – 277,212
– 214 100,000 90,243 – 277,426
21,499 16 59,913 32,063 1,035,106 1,215,221
29,346 (175) 1,311,413 97,602 – 1,760,394
50,845$ (159)$ 1,371,326$ 129,665$ 1,035,106$ 2,975,615$
-87-
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-88-
NONMAJOR CAPITAL PROJECTS FUNDS
Nonmajor capital projects funds are maintained to account for financial resources that are restricted,
committed, or assigned to expenditures for capital outlays. Projects are financed through the issuance of
debt, special assessments, tax levies, dedicated fees, and intergovernmental aids or grants.
Nonmajor capital projects funds presently established are as follows:
Sanitary Sewer Trunk – Used to account for the operations and activities dedicated to the construction
and improvement of sanitary sewer trunk facilities in the City.
Cable Communications – Used to account for the operations and activities related to the provision of
cable communications for public access.
State Aid Construction – Used to account for street construction and road/street rehabilitation or
reconstruction projects that qualify for municipal state aid.
Fire – Used to account for fire capital projects and donations to the fire department.
Recreation – Used to account for capital improvements to city-owned recreation facilities, such as the
senior center, ice arena, and swimming pool; and donations to these activities.
Permanent Improvement Revolving – Used to account for street construction projects financed with
multiple funding sources.
General Capital Equipment – Used to account for the operations and activities related to the City’s
general capital equipment.
Water Trunk – Used to account for the construction and improvement of water trunk infrastructure
within the City.
Parking Lot Project – Used to account for improvements to city parking lots.
Akin Street Reconstruction – Used to account for street improvements related to Akin Street.
Trail Maintenance – Used to account for improvements to city trails.
Building Maintenance – Used to account for improvements to city buildings.
Spruce Street Reconstruction – Used to account for street improvements related to Spruce Street.
Maintenance – Used to account for maintenance of city roads and facilities.
Capital Projects Reserve – Used to account for remaining funds left on other capital projects that will
be used to fund additional capital projects.
2024 Street Improvements – Used to account for the 2024 street improvement projects.
Emerald Ash Borer – Used to account for costs associated with emerald ash borer abatement.
Page 229 of 352
Sanitary
Sewer Cable State Aid
Trunk Communications Construction Fire
Assets
Cash and investments 978,879$ 881,692$ –$ 215,197$
Receivables
Accounts – 40,989 – –
Interest 4,039 3,740 – 888
Special assessments
Noncurrent – – – –
Due from other funds – – – –
Due from other governments – – – –
Total assets 982,918$ 926,421$ –$ 216,085$
Liabilities
Accounts and contracts payable –$ –$ –$ 2,059$
Due to other funds – – – –
Total liabilities – – – 2,059
Deferred inflows of resources
Unavailable revenue – special assessments – – – –
Unavailable revenue – long-term receivable – – – –
Total deferred inflows of resources – – – –
Fund balances (deficits)
Restricted for public, educational, and
governmental (PEG) fees – 211,660 – –
Restricted for recreational projects – – – –
Committed for sanitary sewer trunk 982,918 – – –
Committed for cable communications – 714,761 – –
Committed for fire capital programs – – – 214,026
Committed for improvement projects – – – –
Committed for capital equipment – – – –
Committed for water trunk – – – –
Committed for parking lot projects – – – –
Committed for trail maintenance – – – –
Committed for building maintenance – – – –
Committed for pavement management – – – –
Unassigned – – – –
Total fund balances (deficits)982,918 926,421 – 214,026
Total liabilities, deferred inflows
of resources, and fund balances 982,918$ 926,421$ –$ 216,085$
CITY OF FARMINGTON
Nonmajor Capital Projects Funds
Combining Balance Sheet
as of December 31, 2023
-89-
Page 230 of 352
Permanent General
Improvement Capital Water Parking Lot
Recreation Revolving Equipment Trunk Project
181,478$ –$ 700,956$ 1,023,016$ 570,595$
– – 850 – –
749 – 2,892 4,221 2,354
– – – – –
– – – – –
– – – – –
182,227$ –$ 704,698$ 1,027,237$ 572,949$
17,844$ –$ 7,128$ –$ 49,944$
– – – – –
17,844 – 7,128 – 49,944
– – – – –
– – – – –
– – – – –
– – – – –
119,944 – – – –
– – – – –
– – – – –
– – – – –
44,439 – – – –
– – 697,570 – –
– – – 1,027,237 –
– – – – 523,005
– – – – –
– – – – –
– – – – –
– – – – –
164,383 – 697,570 1,027,237 523,005
182,227$ –$ 704,698$ 1,027,237$ 572,949$
-90-(continued)
Page 231 of 352
Akin Spruce
Street Trail Building Street
Reconstruction Maintenance Maintenance Reconstruction
Assets
Cash and investments 138,178$ 319,081$ 269,275$ 170,822$
Receivables
Accounts – – – –
Interest – 1,317 1,111 705
Special assessments
Noncurrent – – – –
Due from other funds – – – –
Due from other governments – 7,157 – –
Total assets 138,178$ 327,555$ 270,386$ 171,527$
Liabilities
Accounts and contracts payable 270,918$ 17,882$ –$ 381,516$
Due to other funds – – – –
Total liabilities 270,918 17,882 – 381,516
Deferred inflows of resources
Unavailable revenue – special assessments – – – –
Unavailable revenue – long-term receivable – – – –
Total deferred inflows of resources – – – –
Fund balances (deficits)
Restricted for public, educational, and
governmental (PEG) fees – – – –
Restricted for recreational projects – – – –
Committed for sanitary sewer trunk – – – –
Committed for cable communications – – – –
Committed for fire capital programs – – – –
Committed for improvement projects – – – –
Committed for capital equipment – – – –
Committed for water trunk – – – –
Committed for parking lot projects – – – –
Committed for trail maintenance – 309,673 – –
Committed for building maintenance – – 270,386 –
Committed for pavement management – – – –
Unassigned (132,740) – – (209,989)
Total fund balances (deficits)(132,740) 309,673 270,386 (209,989)
Total liabilities, deferred inflows
of resources, and fund balances 138,178$ 327,555$ 270,386$ 171,527$
CITY OF FARMINGTON
Nonmajor Capital Projects Funds
Combining Balance Sheet (continued)
as of December 31, 2023
-91-
Page 232 of 352
Capital Projects 2024 Street Emerald Ash
Maintenance Reserve Improvements Borer Total
2,200,362$ 280,855$ 6,143$ –$ 7,936,529$
– – – – 41,839
9,079 – – – 31,095
– 420,778 – – 420,778
– 35,379 – – 35,379
394,210 – – 15,500 416,867
2,603,651$ 737,012$ 6,143$ 15,500$ 8,882,487$
12,840$ –$ 36,047$ 33,475$ 829,653$
– – 35,379 – 35,379
12,840 – 71,426 33,475 865,032
– 420,778 – – 420,778
394,210 – – – 394,210
394,210 420,778 – – 814,988
– – – – 211,660
– – – – 119,944
– – – – 982,918
– – – – 714,761
– – – – 214,026
– 316,234 – – 360,673
– –– – 697,570
– –– – 1,027,237
– –– – 523,005
– –– – 309,673
– –– – 270,386
2,196,601 – – – 2,196,601
– – (65,283) (17,975) (425,987)
2,196,601 316,234 (65,283) (17,975) 7,202,467
2,603,651$ 737,012$ 6,143$ 15,500$ 8,882,487$
-92-
Page 233 of 352
Sanitary
Sewer Cable State Aid
Trunk Communications Construction Fire
Revenues
Franchise taxes –$ 56,431$ –$ –$
Intergovernmental – – – –
Charges for services 177,042 – – –
Investment earnings 39,053 38,667 1,783 9,271
Other
Donations – – – 30,250
Miscellaneous – – – –
Total revenues 216,095 95,098 1,783 39,521
Expenditures
Current
General government – 119,761 – –
Public safety – – – 38,776
Public works – – – –
Parks and recreation – – – –
Capital outlay
Public safety – – – 4,222
Public works 18,575 – – –
Debt service
Principal – – – –
Interest and fiscal charges – – – –
Total expenditures 18,575 119,761 – 42,998
Excess (deficiency) of revenues
over expenditures 197,520 (24,663) 1,783 (3,477)
Other financing sources (uses)
Sale of capital assets – – – –
Leases issued – – – –
Transfers in – – – –
Transfers out – – (129,049) –
Total other financing sources (uses)– – (129,049) –
Net change in fund balances 197,520 (24,663) (127,266) (3,477)
Fund balances (deficits)
Beginning of year 785,398 951,084 127,266 217,503
End of year 982,918$ 926,421$ –$ 214,026$
Year Ended December 31, 2023
and Changes in Fund Balances
Combining Statement of Revenues, Expenditures,
Nonmajor Capital Projects Funds
CITY OF FARMINGTON
-93-
Page 234 of 352
Permanent General
Improvement Capital Water Parking Lot
Recreation Revolving Equipment Trunk Project
–$ –$ –$ –$ –$
– – – – –
– – – 455,990 –
7,521 2,585 30,962 36,528 28,155
47,799 – – – –
– – 14 – –
55,320 2,585 30,976 492,518 28,155
– – – – –
– – 14,757 – –
– – – – –
25,852 – – – –
– – 1,201,560 – –
– – – – 403,346
– – 81,097 – –
– – 18,469 – –
25,852 – 1,315,883 – 403,346
29,468 2,585 (1,284,907) 492,518 (375,191)
6,721 – 121,205 – –
– – 714,239 – –
– – 625,000 – –
(70,243) (187,185) – – –
(63,522) (187,185) 1,460,444 – –
(34,054) (184,600) 175,537 492,518 (375,191)
198,437 184,600 522,033 534,719 898,196
164,383$ –$ 697,570$ 1,027,237$ 523,005$
-94-(continued)
Page 235 of 352
Akin Spruce
Street Trail Building Street
Reconstruction Maintenance Maintenance Reconstruction
Revenues
Franchise taxes –$ –$ –$ –$
Intergovernmental 2,011,291 52,370 – –
Charges for services – – – –
Investment earnings – 12,027 10,823 25,236
Other
Donations – – – –
Miscellaneous – – 9,600 –
Total revenues 2,011,291 64,397 20,423 25,236
Expenditures
Current
General government – – – –
Public safety – – – –
Public works 134,199 – – 141,138
Parks and recreation – 71,073 – –
Capital outlay
Public safety – – – –
Public works 1,919,576 – – 1,806,050
Debt service
Principal – – – –
Interest and fiscal charges – – – –
Total expenditures 2,053,775 71,073 – 1,947,188
Excess (deficiency) of revenues
over expenditures (42,484) (6,676) 20,423 (1,921,952)
Other financing sources (uses)
Sale of capital assets – – – –
Leases issued – – – –
Transfers in – 150,000 30,000 –
Transfers out – – – –
Total other financing sources (uses)– 150,000 30,000 –
Net change in fund balances (42,484) 143,324 50,423 (1,921,952)
Fund balances (deficits)
Beginning of year (90,256) 166,349 219,963 1,711,963
End of year (132,740)$ 309,673$ 270,386$ (209,989)$
Year Ended December 31, 2023
and Changes in Fund Balances (continued)
Combining Statement of Revenues, Expenditures,
Nonmajor Capital Projects Funds
CITY OF FARMINGTON
-95-
Page 236 of 352
Capital Projects 2024 Street Emerald Ash
Maintenance Reserve Improvements Borer Total
–$ –$ –$ –$ 56,431$
– – – 15,500 2,079,161
11,138 – – – 644,170
88,127 – – – 330,738
– – – – 78,049
– – – – 9,614
99,265 – – 15,500 3,198,163
– – – – 119,761
– – – – 53,533
156,759 – 65,283 349,557 846,936
– – – – 96,925
– – – – 1,205,782
21,045 – – – 4,168,592
– – – – 81,097
– – – – 18,469
177,804 – 65,283 349,557 6,591,095
(78,539) – (65,283) (334,057) (3,392,932)
– – – – 127,926
– – – – 714,239
684,000 316,234 – 316,082 2,121,316
(36,969) – – – (423,446)
647,031 316,234 – 316,082 2,540,035
568,492 316,234 (65,283) (17,975) (852,897)
1,628,109 – – – 8,055,364
2,196,601$ 316,234$ (65,283)$ (17,975)$ 7,202,467$
-96-
Page 237 of 352
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Page 238 of 352
-97-
NONMAJOR DEBT SERVICE FUND
The Debt Service Fund is used to account for the accumulation of resources for the payment of principal
and interest on long-term debt obligations other than those issued for and serviced by an enterprise fund.
2010A General Obligation Improvement Refunding Bonds – The bonds were issued for the
refinancing of the Police Station. This account was closed in 2023.
2013A General Obligation Improvement Refunding Bonds – The bonds were issued to refund the
2005B and 2006A bonds, which were originally issued for the Ash Street, Hill Dee, and Spruce Street
projects. This account was closed in 2023.
2015A General Obligation Street Construction Bonds – The bonds were issued to fund the
195th Avenue Street reconstruction project.
2016A General Obligation Improvement Refunding Bonds – The bonds were issued to refund the
2008A, 2008B, and 2010C bonds, which were originally issued for the Elm Street, 195th Street
Extension, and Walnut Street reconstruction projects. This account was closed in 2023.
2016B General Obligation Capital Improvement Refunding Bonds – The bonds were issued to refund
the 2007A bonds, which were originally issued to finance City Hall and the City Garage.
2019A General Obligation Street Construction Bonds – The bonds were issued to fund the Westview
Street improvement project.
2020A General Obligation Equipment Certificates – The certificates were issued to fund the purchase
of a ladder truck.
2022A General Obligation Street Construction Bonds – The bonds were issued to fund the Spruce
Street and Parking Lot improvement projects.
Page 239 of 352
2010A G.O.2013A G.O.2015A G.O.2016A G.O.
Improvement Improvement Street Improvement
Refunding Refunding Construction Refunding
Bonds Bonds Bonds Bonds
Assets
Cash and investments –$ –$ 502,811$ –$
Receivables
Interest – – 2,075 –
Total assets –$ –$ 504,886$ –$
Liabilities
Accounts and contracts payable –$ –$ 530$ –$
Fund balances
Restricted for debt service – – 504,356 –
Total liabilities and
fund balances –$ –$ 504,886$ –$
CITY OF FARMINGTON
Debt Service Fund
Combining Balance Sheet by Account
as of December 31, 2023
-98-
Page 240 of 352
2016B G.O.
Capital 2019A G.O.2022A G.O.
Improvement Street 2020A G.O.Street
Refunding Construction Equipment Construction
Bonds Bonds Certificates Bonds Total
649,031$ 269,198$ 270,722$ 402,689$ 2,094,451$
2,678 1,111 1,117 1,662 8,643
651,709$ 270,309$ 271,839$ 404,351$ 2,103,094$
530$ 530$ 529$ 530$ 2,649$
651,179 269,779 271,310 403,821 2,100,445
651,709$ 270,309$ 271,839$ 404,351$ 2,103,094$
-99-
Page 241 of 352
2010A G.O.2013A G.O.2015A G.O.2016A G.O.
Improvement Improvement Street Improvement
Refunding Refunding Construction Refunding
Bonds Bonds Bonds Bonds
Revenues
Property taxes –$ –$ 287,648$ –$
Special assessments – 17,528 – –
Investment earnings 446 1,486 16,684 6,014
Total revenues 446 19,014 304,332 6,014
Expenditures
Debt service
Principal – – 225,000 445,000
Interest and fiscal charges – 11 43,405 10,040
Total expenditures – 11 268,405 455,040
Excess (deficiency) of revenues
over expenditures 446 19,003 35,927 (449,026)
Other financing sources (uses)
Transfers out (58,421) (203,057) – (785,464)
Net change in fund balances (57,975) (184,054) 35,927 (1,234,490)
Fund balances
Beginning of year 57,975 184,054 468,429 1,234,490
End of year –$ –$ 504,356$ –$
CITY OF FARMINGTON
Debt Service Fund
Combining Schedule of Revenues, Expenditures,
and Changes in Fund Balances by Account
Year Ended December 31, 2023
-100-
Page 242 of 352
2016B G.O.
Capital 2019A G.O.2022A G.O.
Improvement Street 2020A G.O.Street
Refunding Construction Equipment Construction
Bonds Bonds Certificates Bonds Total
638,000$ 231,525$ 267,487$ 478,905$ 1,903,565$
– – – – 17,528
17,207 7,572 7,173 9,952 66,534
655,207 239,097 274,660 488,857 1,987,627
545,000 200,000 210,000 – 1,625,000
85,805 16,580 41,030 173,318 370,189
630,805 216,580 251,030 173,318 1,995,189
24,402 22,517 23,630 315,539 (7,562)
– – – – (1,046,942)
24,402 22,517 23,630 315,539 (1,054,504)
626,777 247,262 247,680 88,282 3,154,949
651,179$ 269,779$ 271,310$ 403,821$ 2,100,445$
-101-
Page 243 of 352
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Page 244 of 352
-102-
BUDGETARY COMPARISON SCHEDULES
Private Capital Projects Fund
Storm Water Trunk Capital Projects Fund
Nonmajor Special Revenue Funds
Economic Development Authority
Dakota Broadband
Trident Housing Tax Increment
Police Donations and Forfeitures
Park Improvement
Arena
Nonmajor Capital Projects Funds
Sanitary Sewer Trunk
Cable Communications
State Aid Construction
Fire
Recreation
Permanent Improvement Revolving
General Capital Equipment
Water Trunk
Trail Maintenance
Building Maintenance
Maintenance
Nonmajor Debt Service Fund
Debt Service
Page 245 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Investment earnings 7,000$ 83,525$ 76,525$
Fund balances
Beginning of year 42,300
End of year 125,825$
CITY OF FARMINGTON
Private Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-103-
Page 246 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Property taxes 166,000$ 166,000$ –$
Charges for services 100,000 277,962 177,962
Investment earnings 16,700 228,231 211,531
Total revenues 282,700 672,193 389,493
Expenditures
Debt service
Interest and fiscal charges – 7,883 7,883
Net change in fund balances 282,700$ 664,310 381,610$
Fund balances
Beginning of year 4,703,897
End of year 5,368,207$
CITY OF FARMINGTON
Storm Water Trunk Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-104-
Page 247 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Investment earnings 1,600$ 11,382$ 9,782$
Expenditures
Current
Economic development 81,510 72,392 (9,118)
Excess (deficiency) of revenues
over expenditures (79,910) (61,010) 18,900
Other financing sources
Transfers in 50,000 86,969 36,969
Net change in fund balances (29,910)$ 25,959 55,869$
Fund balances
Beginning of year 248,987
End of year 274,946$
CITY OF FARMINGTON
Economic Development Authority Special Revenue Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-105-
Page 248 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Intergovernmental 167,883$ 32,904$ (134,979)$
Expenditures
Current
Economic development 167,883 2,973 (164,910)
Net change in fund balances –$ 29,931 29,931$
Fund balances
Beginning of year 121
End of year 30,052$
CITY OF FARMINGTON
Dakota Broadband Special Revenue Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-106-
Page 249 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Property taxes 146,210$ 110,955$ (35,255)$
Investment earnings 400 3,803 3,403
Total revenues 146,610 114,758 (31,852)
Expenditures
Current
Economic development 134,439 102,562 (31,877)
Net change in fund balances 12,171$ 12,196 25$
Fund balances
Beginning of year 57,744
End of year 69,940$
CITY OF FARMINGTON
Trident Housing Tax Increment Special Revenue Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-107-
Page 250 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Investment earnings 50$ 733$ 683$
Expenditures
Current
Public safety 2,000 – (2,000)
Capital outlay
Public safety – 2,195 2,195
Total expenditures 2,000 2,195 195
Excess (deficiency) of revenues
over expenditures (1,950) (1,462) 488
Other financing sources
Sale of capital assets 3,500 – (3,500)
Net change in fund balances 1,550$ (1,462) (3,012)$
Fund balances
Beginning of year 15,356
End of year 13,894$
CITY OF FARMINGTON
Police Donations and Forfeitures Special Revenue Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-108-
Page 251 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Investment earnings 4,000$ 60,142$ 56,142$
Other
Donations – 1,175 1,175
Rentals 8,560 8,560 –
Miscellaneous 75,000 177,311 102,311
Total revenues 87,560 247,188 159,628
Expenditures
Current
Parks and recreation 352,000 67,423 (284,577)
Capital outlay
Parks and recreation 10,250 219,852 209,602
Total expenditures 362,250 287,275 (74,975)
Excess (deficiency) of
revenues over expenditures (274,690) (40,087) 234,603
Other financing sources
Transfers in 100,000 100,000 –
Net change in fund balances (174,690)$ 59,913 234,603$
Fund balances
Beginning of year 1,311,413
End of year 1,371,326$
CITY OF FARMINGTON
Park Improvement Special Revenue Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-109-
Page 252 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Charges for services 426,000$ 415,475$ (10,525)$
Investment earnings 400 881 481
Other
Donations 5,000 10,000 5,000
Rentals 3,500 5,005 1,505
Miscellaneous – 4,002 4,002
Total revenues 434,900 435,363 463
Expenditures
Current
Parks and recreation 452,107 478,875 26,768
Capital outlay
Parks and recreation 1,000 14,668 13,668
Total expenditures 453,107 493,543 40,436
Excess (deficiency) of
revenues over expenditures (18,207) (58,180) (39,973)
Other financing sources
Transfers in – 90,243 90,243
Net change in fund balances (18,207)$ 32,063 50,270$
Fund balances
Beginning of year 97,602
End of year 129,665$
CITY OF FARMINGTON
Arena Special Revenue Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-110-
Page 253 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Charges for services 68,400$ 177,042$ 108,642$
Investment earnings 2,900 39,053 36,153
Total revenues 71,300 216,095 144,795
Expenditures
Capital outlay
Public works – 18,575 18,575
Net change in fund balances 71,300$ 197,520 126,220$
Fund balances
Beginning of year 785,398
End of year 982,918$
CITY OF FARMINGTON
Sanitary Sewer Trunk Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-111-
Page 254 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Franchise taxes 120,000$ 56,431$ (63,569)$
Investment earnings 5,600 38,667 33,067
Total revenues 125,600 95,098 (30,502)
Expenditures
Current
General government 133,385 119,761 (13,624)
Capital outlay
General government 30,000 – (30,000)
Total expenditures 163,385 119,761 (43,624)
Net change in fund balances (37,785)$ (24,663) 13,122$
Fund balances
Beginning of year 951,084
End of year 926,421$
CITY OF FARMINGTON
Cable Communications Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-112-
Page 255 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Investment earnings 800$ 1,783$ 983$
Other financing (uses)
Transfers out – (129,049) (129,049)
Net change in fund balances 800$ (127,266) (128,066)$
Fund balances
Beginning of year 127,266
End of year –$
CITY OF FARMINGTON
State Aid Construction Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-113-
Page 256 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Investment earnings 700$ 9,271$ 8,571$
Other
Donations – 30,250 30,250
Total revenues 700 39,521 38,821
Expenditures
Current
Public safety 2,000 38,776 36,776
Capital outlay
Public safety 5,000 4,222 (778)
Total expenditures 7,000 42,998 35,998
Net change in fund balances (6,300)$ (3,477) 2,823$
Fund balances
Beginning of year 217,503
End of year 214,026$
CITY OF FARMINGTON
Fire Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-114-
Page 257 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Investment earnings 800$ 7,521$ 6,721$
Other
Donations 20,000 47,799 27,799
Total revenues 20,800 55,320 34,520
Expenditures
Current
Parks and recreation 92,000 25,852 (66,148)
Capital outlay
Parks and recreation 6,000 – (6,000)
Total expenditures 98,000 25,852 (72,148)
Excess (deficiency) of revenues
over expenditures (77,200) 29,468 106,668
Other financing sources (uses)
Sale of capital assets – 6,721 6,721
Transfers in 20,000 – (20,000)
Transfers out – (70,243) (70,243)
Total other financing sources (uses)20,000 (63,522) (83,522)
Net change in fund balances (57,200)$ (34,054) 23,146$
Fund balances
Beginning of year 198,437
End of year 164,383$
CITY OF FARMINGTON
Recreation Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-115-
Page 258 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Investment earnings 1,000$ 2,585$ 1,585$
Other financing (uses)
Transfers out – (187,185) (187,185)
Net change in fund balances 1,000$ (184,600) (185,600)$
Fund balances
Beginning of year 184,600
End of year –$
CITY OF FARMINGTON
Permanent Improvement Revolving Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-116-
Page 259 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Investment earnings 4,500$ 30,962$ 26,462$
Other
Donations – 14 14
4,500 30,976 26,476
Expenditures
Current
Public safety – 14,757 14,757
Capital outlay
Public safety 557,408 1,201,560 644,152
Debt service
Principal – 81,097 81,097
Interest and fiscal charges – 18,469 18,469
Total expenditures 557,408 1,315,883 758,475
Excess (deficiency) of revenues
over expenditures (552,908) (1,284,907) (731,999)
Other financing sources
Sale of capital assets – 121,205 121,205
Leases issued – 714,239 714,239
Transfers in 625,000 625,000 –
Total other financing sources 625,000 1,460,444 835,444
Net change in fund balances 72,092$ 175,537 103,445$
Fund balances
Beginning of year 522,033
End of year 697,570$
CITY OF FARMINGTON
General Capital Equipment Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-117-
Page 260 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Charges for services 303,600$ 455,990$ 152,390$
Investment earnings – 36,528 36,528
Total revenues 303,600$ 492,518 188,918$
Fund balances
Beginning of year 534,719
End of year 1,027,237$
CITY OF FARMINGTON
Water Trunk Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-118-
Page 261 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Intergovernmental –$ 52,370$ 52,370$
Investment earnings 300 12,027 11,727
Total revenues 300 64,397 64,097
Expenditures
Current
Parks and recreation 174,920 71,073 (103,847)
Excess (deficiency) of revenues
over expenditures (174,620) (6,676) 167,944
Other financing sources
Transfers in 150,000 150,000 –
Net change in fund balances (24,620)$ 143,324 167,944$
Fund balances
Beginning of year 166,349
End of year 309,673$
CITY OF FARMINGTON
Trail Maintenance Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-119-
Page 262 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Investment earnings 100$ 10,823$ 10,723$
Other
Miscellaneous – 9,600 9,600
Total revenues 100 20,423 20,323
Expenditures
Current
General government 43,359 – (43,359)
Excess (deficiency) of revenues
over expenditures (43,259) 20,423 63,682
Other financing sources
Transfers in 30,000 30,000 –
Net change in fund balances (13,259)$ 50,423 63,682$
Fund balances
Beginning of year 219,963
End of year 270,386$
CITY OF FARMINGTON
Building Maintenance Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-120-
Page 263 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Intergovernmental 697,000$ –$ (697,000)$
Charges for service – 11,138 11,138
Investment earnings 8,200 88,127 79,927
Total revenues 705,200 99,265 (605,935)
Expenditures
Current
Public works 852,400 156,759 (695,641)
Capital outlay
Public works 6,538,000 21,045 (6,516,955)
Total expenditures 7,390,400 177,804 (7,212,596)
Excess (deficiency) of revenues
over expenditures (6,685,200) (78,539) 6,606,661
Other financing sources (uses)
Bonds issued 3,573,000 – (3,573,000)
Transfers in 3,002,000 684,000 (2,318,000)
Transfers out – (36,969) (36,969)
Total other financing sources (uses)6,575,000 647,031 (5,927,969)
Net change in fund balances (110,200)$ 568,492 678,692$
Fund balances
Beginning of year 1,628,109
End of year 2,196,601$
CITY OF FARMINGTON
Maintenance Capital Projects Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-121-
Page 264 of 352
Original and Variance With
Final Budget Actual Final Budget
Revenues
Property taxes 1,903,565$ 1,903,565$ –$
Special assessments 237,300 17,528 (219,772)
Investment earnings 7,600 66,534 58,934
Total revenues 2,148,465 1,987,627 (160,838)
Expenditures
Debt service
Principal 1,625,000 1,625,000 –
Interest and fiscal charges 379,356 370,189 (9,167)
Total expenditures 2,004,356 1,995,189 (9,167)
Excess (deficiency) of revenues
over expenditures 144,109 (7,562) (151,671)
Other financing (uses)
Transfers out – (1,046,942) (1,046,942)
Net change in fund balances 144,109$ (1,054,504) (1,198,613)$
Fund balances
Beginning of year 3,154,949
End of year 2,100,445$
CITY OF FARMINGTON
Debt Service Fund
Budgetary Comparison Schedule
Year Ended December 31, 2023
-122-
Page 265 of 352
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Page 266 of 352
-123-
INTERNAL SERVICE FUNDS
Employee Expense – Used to account for the costs of employer-paid benefits, including pension, Social
Security, health, life and dental insurance, and workers’ compensation insurance.
Property and Liability Insurance – Used to account for the costs of property and liability insurance for the
City.
Fleet – Used to account for the costs of vehicle maintenance services provided to divisions by staff at the
City Garage facility.
Information Technology – Used to account for the costs of computer hardware, software, and internet
services provided to all city departments.
Page 267 of 352
Property
Employee and Liability Information
Expense Insurance Fleet Technology Total
Assets
Current assets
Cash and investments 1,684,135$ 495,253$ 50,848$ 751,042$ 2,981,278$
Receivables
Interest 6,949 2,043 210 3,099 12,301
Due from other governments 15,862 – – – 15,862
Prepaid items – – – 4,125 4,125
Total current assets 1,706,946 497,296 51,058 758,266 3,013,566
Noncurrent assets
Capital assets
Machinery and equipment – – 99,124 – 99,124
Less accumulated depreciation – – (96,375)– (96,375)
Total capital assets – – 2,749 – 2,749
Total assets 1,706,946$ 497,296$ 53,807$ 758,266$ 3,016,315$
Current liabilities
Accounts and contracts payable –$ –$ 7,776$ 78,357$ 86,133$
Accrued salaries and employee
benefits payable 227,489 – – – 227,489
Deposits payable 2,720 – – – 2,720
Compensated absences payable – – 36,250 15,532 51,782
Total current liabilities 230,209 – 44,026 93,889 368,124
Net position
Investment in capital assets – – 2,749 – 2,749
Unrestricted 1,476,737 497,296 7,032 664,377 2,645,442
Total net position 1,476,737 497,296 9,781 664,377 2,648,191
Total liabilities and net position 1,706,946$ 497,296$ 53,807$ 758,266$ 3,016,315$
as of December 31, 2023
CITY OF FARMINGTON
Internal Service Funds
Combining Statement of Net Position
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Page 268 of 352
Property
Employee and Liability Information
Expense Insurance Fleet Technology Total
Operating revenues
Charges for services 2,764,462$ –$ 234,700$ 798,289$ 3,797,451$
Insurance reimbursement – 328,057 – – 328,057
Total operating revenues 2,764,462 328,057 234,700 798,289 4,125,508
Operating expenses
Personal services 2,923,857 – 239,757 240,969 3,404,583
Professional services 95 1 31,830 462,389 494,315
Materials and supplies – – 51,498 130,206 181,704
Insurance – 334,721 – – 334,721
Depreciation – – 1,100 – 1,100
Total operating expenses 2,923,952 334,722 324,185 833,564 4,416,423
Operating income (loss)(159,490) (6,665) (89,485) (35,275) (290,915)
Nonoperating revenue
Investment earnings 76,272 19,219 3,146 30,465 129,102
Income (loss) before transfers (83,218) 12,554 (86,339) (4,810) (161,813)
Transfers in 13,022 22,000 – – 35,022
Change in net position (70,196) 34,554 (86,339) (4,810) (126,791)
Net position
Beginning of year 1,546,933 462,742 96,120 669,187 2,774,982
End of year 1,476,737$ 497,296$ 9,781$ 664,377$ 2,648,191$
Year Ended December 31, 2023
CITY OF FARMINGTON
Internal Service Funds
Combining Statement of Revenues, Expenses,
and Changes in Fund Net Position
-125-
Page 269 of 352
Property
Employee and Liability Information
Expense Insurance Fleet Technology Total
Cash flows from operating activities
Cash receipts from other funds and reimbursements 2,748,724$ 368,795$ 234,700$ 798,289$ 4,150,508$
Cash payments to employees for services (2,933,691) – (236,371) (241,678) (3,411,740)
Cash payments for interfund services used (95) (343,521) (77,741) (536,866) (958,223)
Net cash flows from operating activities (185,062) 25,274 (79,412) 19,745 (219,455)
Cash flows from noncapital financing activities
Transfers in 13,022 22,000 – – 35,022
Cash flows from investing activities
Interest received and changes in fair value on
investments 74,917 18,525 3,335 29,523 126,300
Net increase (decrease) in cash and
cash equivalents (97,123) 65,799 (76,077) 49,268 (58,133)
Cash and cash equivalents
Beginning of year 1,781,258 429,454 126,925 701,774 3,039,411
End of year 1,684,135$ 495,253$ 50,848$ 751,042$ 2,981,278$
Reconciliation of operating income (loss) to net
cash flows from operating activities
Operating income (loss) (159,490)$ (6,665)$ (89,485)$ (35,275)$ (290,915)$
Adjustments to reconcile operating income (loss)
to net cash flows from operating activities
Depreciation – – 1,100 – 1,100
Change in assets and liabilities
Accounts receivable – 40,738 – – 40,738
Due from other governments (15,738) – – – (15,738)
Prepaid items – – – 41,559 41,559
Accounts and contracts payable (1,678) (8,799) 5,587 14,170 9,280
Accrued salaries and employee benefits (8,870) – – – (8,870)
Deposits payable 714 – – – 714
Compensated absences payable – – 3,386 (709) 2,677
Total adjustments (25,572) 31,939 10,073 55,020 71,460
Net cash flows from operating activities (185,062)$ 25,274$ (79,412)$ 19,745$ (219,455)$
Year Ended December 31, 2023
CITY OF FARMINGTON
Internal Service Funds
Combining Statement of Cash Flows
-126-
Page 270 of 352
STATISTICAL SECTION
(UNAUDITED)
Page 271 of 352
Page 272 of 352
-127-
STATISTICAL TABLES
(UNAUDITED)
This part of the City’s Annual Comprehensive Financial Report (ACFR) presents detailed information as
a context for understanding this year’s financial statements, note disclosures, and supplementary
information. This information has not been audited by the independent auditor.
The contents of the statistical section include:
Financial Trends – These tables contain trend information that may assist the reader in assessing the
City’s current financial performance by placing it in historical perspective.
Revenue Capacity – These tables contain information to assist the reader in assessing the City’s
most significant local revenue source—property taxes.
Debt Capacity – These tables present information that may assist the reader in analyzing 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 – These tables offer economic and demographic
indicators that are commonly used for financial analysis and that can assist the reader in
understanding the City’s present and ongoing financial status.
Operating Information – These tables contain service and infrastructure indicators that can assist the
reader in understanding how the information in the City’s financial report relates to the services the
City provides and the activities it performs.
Source – Unless otherwise noted, the information in these tables is derived from the ACFR for the
relevant year.
Page 273 of 352
Fiscal Year
2014 2015 2016 2017
Governmental activities
Net investment in capital assets 23,383,175$ 21,417,203$ 23,684,773$ 28,820,307$
Restricted 9,235,448 9,063,587 10,441,391 6,961,837
Unrestricted 13,150,789 8,920,144 5,142,435 6,576,959
Total governmental activities net position 45,769,412$ 39,400,934$ 39,268,599$ 42,359,103$
Business-type activities
Net investment in capital assets 55,685,476$ 54,807,938$ 53,225,787$ 51,464,649$
Restricted 2,160,566 2,160,566 2,231,966 2,238,206
Unrestricted 10,396,218 11,439,369 12,575,526 13,508,485
Total business-type activities net position 68,242,260$ 68,407,873$ 68,033,279$ 67,211,340$
Primary government
Net investment in capital assets 79,068,651$ 76,225,141$ 76,910,560$ 80,284,956$
Restricted 11,396,014 11,224,153 12,673,357 9,200,043
Unrestricted 23,547,007 20,359,513 17,717,961 20,085,444
Total primary government net position 114,011,672$ 107,808,807$ 107,301,878$ 109,570,443$
Note 1:
Note 2:
The City implemented GASB Statement No.68 in fiscal 2015,recording a change in accounting principle that
decreased unrestricted net position. Prior year balances were not restated.
The City implemented GASB Statement No.87 in fiscal 2022,recording a change in accounting principle that
decreased unrestricted net position. Prior year balances were not restated.
CITY OF FARMINGTON
Net Position by Component
Last Ten Fiscal Years
(accrual basis of accounting)
-128-
Page 274 of 352
2018 2019 2020 2021 2022 2023
32,909,853$ 33,867,761$ 35,883,311$ 36,819,084$ 37,033,206$ 39,137,210$
4,797,191 5,343,074 5,224,015 9,841,913 10,556,611 9,132,767
7,997,614 8,001,782 9,236,760 11,591,481 14,198,632 16,705,704
45,704,658$ 47,212,617$ 50,344,086$ 58,252,478$ 61,788,449$ 64,975,681$
50,747,479$ 53,677,776$ 51,976,059$ 50,773,632$ 48,353,192$ 48,486,110$
2,316,500 2,461,488 2,461,488 2,461,488 2,461,488 2,461,488
14,594,293 13,187,014 15,418,911 18,123,198 18,266,640 21,351,782
67,658,272$ 69,326,278$ 69,856,458$ 71,358,318$ 69,081,320$ 72,299,380$
83,657,332$ 87,545,537$ 87,859,370$ 87,592,716$ 85,386,398$ 87,623,320$
7,113,691 7,804,562 7,685,503 12,303,401 13,018,099 11,594,255
22,591,907 21,188,796 24,655,671 29,714,679 32,465,272 38,057,486
113,362,930$ 116,538,895$ 120,200,544$ 129,610,796$ 130,869,769$ 137,275,061$
-129-
Page 275 of 352
Fiscal Year
2014 2015 2016 2017
Expenses
Governmental activities
General government 1,940,630$ 2,284,974$ 2,268,779$ 2,178,067$
Public safety 5,192,091 5,357,738 6,979,608 6,472,115
Public works 4,893,341 7,473,095 5,497,796 3,888,778
Park and recreation 1,730,734 1,815,882 1,904,792 1,782,783
Economic development 49,417 90,000 40,000 40,000
Interest and fiscal charges 1,020,096 992,422 1,032,748 549,075
Total governmental activities expenses 14,826,309$ 18,014,111$ 17,723,723$ 14,910,818$
Business-type activities
Liquor operations 4,315,834$ 4,352,597$ 4,448,932$ 4,634,488$
Sewer operations 1,712,146 1,875,225 2,051,152 2,105,901
Solid waste 1,600,434 1,658,128 1,753,162 1,864,175
Storm water 615,684 731,444 534,988 571,572
Water 1,410,214 1,339,588 1,359,215 1,313,482
Street light 174,957 173,212 288,924 197,150
Total business-type activities 9,829,269 10,130,194 10,436,373 10,686,768
Total primary government expenses 24,655,578$ 28,144,305$ 28,160,096$ 25,597,586$
Program revenues
Governmental activities
Charges for services
General government 534,008$ 399,053$ 668,849$ 434,411$
Public safety 409,460 351,038 459,240 405,648
Public works 94,416 9,624 195,716 76,049
Parks and recreation 607,566 604,111 651,936 619,026
Operating grants and contributions 677,999 649,541 744,730 684,376
Capital grants and contributions 477,833 671,671 818,545 848,167
Total governmental activities program revenues 2,801,282$ 2,685,038$ 3,539,016$ 3,067,677$
CITY OF FARMINGTON
Changes in Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
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Page 276 of 352
2018 2019 2020 2021 2022 2023
2,511,818$ 2,609,059$ 2,933,062$ 2,560,243$ 3,626,853$ 5,200,453$
5,728,925 6,118,203 6,834,253 6,549,508 7,936,364 8,712,115
4,358,465 5,612,872 5,262,979 3,977,134 5,333,328 3,806,386
1,772,351 2,202,631 1,430,839 2,789,326 2,522,085 2,583,554
30,000 50,000 276,900 406,795 247,970 177,927
350,431 404,893 193,167 189,858 288,751 239,992
14,751,990$ 16,997,658$ 16,931,200$ 16,472,864$ 19,955,351$ 20,720,427$
4,890,304$ 5,257,236$ 4,958,705$ 5,256,311$ 5,977,403$ 6,256,081$
1,931,276 2,326,630 2,334,000 2,459,637 2,606,288 2,872,236
2,092,844 1,913,258 2,630,874 2,566,976 87,359 76,270
521,465 557,749 530,438 581,402 719,225 725,039
1,246,667 1,439,178 1,626,279 1,764,908 1,814,354 1,889,215
180,254 165,886 173,604 180,528 210,174 214,757
10,862,810 11,659,937 12,253,900 12,809,762 11,414,803 12,033,598
25,614,800$ 28,657,595$ 29,185,100$ 29,282,626$ 31,370,154$ 32,754,025$
467,417$ 471,569$ 631,118$ 855,812$ 999,320$ 1,048,415$
408,434 437,054 413,594 560,518 550,052 581,869
273,695 189,282 201,401 708,197 1,215,397 965,032
709,490 582,631 389,870 987,028 913,710 829,870
702,853 838,569 713,470 1,062,789 1,076,883 1,924,255
942,627 869,849 50,478 4,106,221 833,090 1,002,806
3,504,516$ 3,388,954$ 2,399,931$ 8,280,565$ 5,588,452$ 6,352,247$
-131-(continued)
Page 277 of 352
Fiscal Year
2014 2015 2016 2017
Program revenues (continued)
Business-type activities
Charges for services
Liquor operations 4,639,194$ 4,607,417$ 4,742,313$ 4,967,468$
Sewer 1,843,746 1,957,902 2,043,859 2,068,388
Solid waste 1,979,623 1,991,179 2,041,561 2,061,324
Storm water 559,327 670,353 643,479 647,767
Water 1,499,091 1,439,873 1,631,643 1,681,079
Street light 219,052 222,159 224,781 225,570
Operating grants and contributions 21,000 22,000 23,000 24,000
Capital grants and contributions – 945,938 – –
Total business-type activities program revenues 10,761,033 11,856,821 11,350,636 11,675,596
Total primary government program revenues 13,562,315$ 14,541,859$ 14,889,652$ 14,743,273$
Net (expense) revenue
Governmental activities (12,025,027)$ (15,329,073)$ (14,184,707)$ (11,843,141)$
Business-type activities 931,764 1,726,627 914,263 988,828
Total primary government net expense (11,093,263)$ (13,602,446)$ (13,270,444)$ (10,854,313)$
General revenues and other changes in net position
Governmental activities
Property taxes 10,962,860$ 11,460,209$ 11,806,302$ 12,181,830$
Franchise taxes 269,208 265,485 275,691 266,728
Unrestricted grants and contributions 257,386 278,974 287,252 289,854
Unrestricted investment earnings (charges)130,739 189,540 255,021 200,851
Gain on sale of capital assets – – – 54,408
Transfers 1,414,119 1,222,807 1,428,106 1,939,974
Total governmental activities 13,034,312$ 13,417,015$ 14,052,372$ 14,933,645$
Business-type activities
Unrestricted grants and contributions –$ –$ –$ –$
Unrestricted investment earnings (charges)246,220 152,954 139,249 129,207
Transfers (1,414,119) (1,222,807) (1,428,106) (1,939,974)
Total business-type activities (1,167,899) (1,069,853) (1,288,857) (1,810,767)
Total primary government 11,866,413$ 12,347,162$ 12,763,515$ 13,122,878$
Change in net position
Governmental activities 1,009,285$ (1,912,058)$ (132,335)$ 3,090,504$
Business-type activities (236,135) 656,774 (374,594) (821,939)
Total primary government 773,150$ (1,255,284)$ (506,929)$ 2,268,565$
CITY OF FARMINGTON
Changes in Net Position
Last Ten Fiscal Years (continued)
(accrual basis of accounting)
-132-
Page 278 of 352
2018 2019 2020 2021 2022 2023
5,256,645$ 5,608,012$ 5,347,194$ 5,724,828$ 6,391,785$ 6,770,039$
2,045,728 2,117,934 2,160,808 2,264,006 2,611,202 2,762,566
2,071,672 2,244,569 2,692,155 2,858,958 27,491 10,605
737,115 1,130,563 1,149,665 1,158,564 1,227,091 1,327,620
1,852,381 2,281,793 2,533,753 3,251,453 2,533,222 2,799,075
226,674 226,971 232,990 232,378 236,117 238,805
30,263 34,190 26,710 240,598 30,616 10,822
– 81,634 – 476,930 – –
12,220,478 13,725,666 14,143,275 16,207,715 13,057,524 13,919,532
12,220,478$ 13,807,300$ 14,143,275$ 16,684,645$ 13,057,524$ 13,919,532$
(11,247,474)$ (13,608,704)$ (14,531,269)$ (8,192,299)$ (14,366,899)$ (14,368,180)$
1,357,668 2,065,729 1,889,375 3,397,953 1,642,721 1,885,934
(9,889,806)$ (11,542,975)$ (12,641,894)$ (4,794,346)$ (12,724,178)$ (12,482,246)$
12,659,480$ 12,916,115$ 13,044,381$ 13,692,990$ 14,463,106$ 15,284,709$
266,324 262,148 244,839 229,355 227,017 201,431
316,100 317,172 2,042,381 107,962 207,501 944,364
239,714 657,977 526,283 (91,107) (874,200) 1,407,087
531 17,218 16,174 – 81,008 136,368
1,110,880 946,033 1,788,680 1,831,571 3,393,908 (418,547)
14,593,029$ 15,116,663$ 17,662,738$ 15,770,771$ 17,498,340$ 17,555,412$
–$ –$ 18,136$ –$ –$ –$
200,144 548,310 411,349 (64,522) (525,811) 913,579
(1,110,880) (946,033) (1,788,680) (1,831,571) (3,393,908) 418,547
(910,736) (397,723) (1,359,195) (1,896,093) (3,919,719) 1,332,126
13,682,293$ 14,718,940$ 16,303,543$ 13,874,678$ 13,578,621$ 18,887,538$
3,345,555$ 1,507,959$ 3,131,469$ 7,578,472$ 3,131,441$ 3,187,232$
446,932 1,668,006 530,180 1,501,860 (2,276,998) 3,218,060
3,792,487$ 3,175,965$ 3,661,649$ 9,080,332$ 854,443$ 6,405,292$
-133-
Page 279 of 352
Fiscal Year
2014 2015 2016 2017
General Fund
Nonspendable 33,369$ 6,034$ 33,762$ 34,529$
Committed – – – –
Assigned 81,000 4,250 – –
Unassigned 3,993,191 4,734,534 5,031,529 5,666,183
Total General Fund 4,107,560$ 4,744,818$ 5,065,291$ 5,700,712$
All other governmental funds
Nonspendable 160$ 150$ 110$ –$
Restricted 5,673,161 5,776,314 16,959,150 4,071,837
Committed – 8,025,185 5,158,828 6,373,022
Assigned 7,531,076 – – –
Unassigned – – – –
Total all other governmental funds 13,204,397$ 13,801,649$ 22,118,088$ 10,444,859$
Total all funds 17,311,957$ 18,546,467$ 27,183,379$ 16,145,571$
Note:
CITY OF FARMINGTON
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
The City modified its fund balance policy in 2015, resulting in an increase in committed fund balances.
-134-
Page 280 of 352
2018 2019 2020 2021 2022 2023
5,045$ 109,523$ 141,196$ 83,088$ 1,635$ 1,169$
240,000 – – – – –
– – – – – –
5,477,026 5,761,747 6,060,870 6,843,396 7,829,882 8,987,268
5,722,071$ 5,871,270$ 6,202,066$ 6,926,484$ 7,831,517$ 8,988,437$
–$ –$ 1,184,677$ 1,365$ 2,500$ 14,714$
2,009,629 3,196,214 3,235,717 4,411,713 4,799,381 5,007,682
7,586,959 7,298,103 8,427,605 8,876,306 13,005,454 13,191,023
– – – – – 1,598,024
– – – (29,832) (172,932) (448,106)
9,596,588$ 10,494,317$ 12,847,999$ 13,259,552$ 17,634,403$ 19,363,337$
15,318,659$ 16,365,587$ 19,050,065$ 20,186,036$ 25,465,920$ 28,351,774$
-135-
Page 281 of 352
Fiscal Year
2014 2015 2016 2017
Revenues
Property taxes 11,031,219$ 11,462,986$ 11,852,567$ 12,186,789$
Franchise taxes 269,208 265,485 275,691 266,728
Special assessments 821,331 661,187 545,777 532,744
Licenses and permits 514,728 370,889 650,311 415,005
Intergovernmental 1,011,221 2,097,509 1,633,388 1,632,170
Charges for services 890,281 820,445 1,077,860 929,784
Fines and forfeits 65,482 52,299 41,750 45,102
Investment earnings (charges)130,739 172,818 237,224 183,402
Other 174,959 160,193 260,564 201,288
Total revenues 14,909,168 16,063,811 16,575,132 16,393,012
Expenditures
Current
General government 1,717,994 1,947,768 1,996,410 2,051,143
Public safety 4,871,745 5,131,076 5,301,211 5,537,937
Public works 2,038,161 1,971,079 2,006,606 2,381,695
Park and recreation 1,448,951 1,538,452 1,513,411 1,585,656
Economic development 49,417 90,000 40,000 40,000
Capital outlay 1,839,726 4,695,581 2,755,780 586,495
Debt service
Principal 2,376,739 2,899,162 4,411,534 6,395,000
Interest and fiscal charges 1,096,007 1,041,780 1,095,380 818,144
Total expenditures 15,438,740 19,314,898 19,120,332 19,396,070
Excess (deficiency) of revenues
over expenditures (529,572) (3,251,087) (2,545,200) (3,003,058)
Other financing sources (uses)
Debt issued – 3,184,641 10,120,095 –
Payment of refunded debt (1,435,000) – – (9,990,000)
Sale of capital assets 22,473 157,599 13,043 54,408
Transfers in 2,330,331 5,937,539 5,590,211 2,981,402
Transfers out (916,212) (4,794,182) (4,541,237) (1,080,560)
Total other financing sources (uses)1,592 4,485,597 11,182,112 (8,034,750)
Net change in fund balances (527,980)$ 1,234,510$ 8,636,912$ (11,037,808)$
Debt service as a percentage of noncapital
expenditures 24.8%21.0%29.5%37.9%
CITY OF FARMINGTON
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
-136-
Page 282 of 352
2018 2019 2020 2021 2022 2023
12,665,721$ 12,926,730$ 13,049,745$ 13,700,787$ 14,449,100$ 15,251,002$
266,324 262,148 244,839 229,355 227,017 201,431
314,594 625,308 407,412 279,579 533,337 520,116
449,350 421,578 588,347 789,965 823,729 927,731
1,768,219 1,796,575 2,948,939 1,257,177 1,268,198 4,943,868
1,094,360 1,042,292 890,408 1,697,708 2,275,257 2,031,701
60,182 63,561 45,959 52,340 58,400 57,509
209,968 567,539 455,233 (81,823) (793,738) 1,277,985
305,014 226,316 161,687 600,280 648,430 437,525
17,133,732 17,932,047 18,792,569 18,525,368 19,489,730 25,648,868
2,311,024 2,407,932 2,637,945 2,693,428 3,191,346 4,184,318
5,348,888 5,705,820 5,917,499 6,438,859 6,834,703 7,206,927
2,690,271 3,272,313 2,794,566 2,639,935 3,261,324 3,866,764
1,595,924 1,855,261 1,560,781 1,884,846 1,939,271 2,243,990
30,000 50,000 276,900 385,434 241,518 177,927
1,597,191 4,715,989 2,664,884 3,045,812 3,978,547 5,661,851
5,180,000 2,435,000 2,910,000 2,155,000 2,199,417 1,706,097
503,061 412,373 397,231 368,738 361,727 396,541
19,256,359 20,854,688 19,159,806 19,612,052 22,007,853 25,444,415
(2,122,627) (2,922,641) (367,237) (1,086,684) (2,518,123) 204,453
– 1,009,555 1,279,300 – 4,088,692 714,239
– – – – – –
11,000 18,939 12,867 84,662 80,249 136,368
3,214,991 4,280,247 4,263,090 2,854,791 9,437,491 4,943,204
(1,930,276) (1,339,172) (2,503,542) (1,046,718) (6,212,955) (3,112,410)
1,295,715 3,969,569 3,051,715 1,892,735 7,393,477 2,681,401
(826,912)$ 1,046,928$ 2,684,478$ 806,051$ 4,875,354$ 2,885,854$
31.3%16.5%18.5%14.1%13.7%10.9%
-137-
Page 283 of 352
Commercial/
Industrial,Less
Public Utility,Captured
Residential Railroads, and Agricultural Tax Increment
Property Personal Property Apartments Property Tax Capacity
11,207,086$ 2,669,813$ 272,246$ 234,772$ (119,175)$
12,802,297 2,688,017 271,615 266,387 (113,361)
14,005,748 2,739,868 280,096 272,897 (117,585)
14,798,507 2,805,453 295,234 272,086 (118,368)
15,932,445 2,884,545 382,700 257,966 (37,168)
17,392,473 2,937,228 487,014 266,572 (146,966)
18,650,539 2,893,434 476,353 275,228 (145,234)
20,067,551 3,129,074 519,937 266,742 (106,443)
21,162,785 3,085,886 533,529 277,064 (104,238)
26,060,779 3,962,038 573,811 309,162 (108,548)
Note:
Source:Dakota County
The tax capacity (assessed taxable value)of the property is calculated by applying a statutory formula to the
estimated market value of the property.
2014
2015
2017
2016
2018
2019
2020
2021
2022
2023
CITY OF FARMINGTON
Payable
Year
Tax Capacity Value and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
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Less Estimated
Contributions Actual
to Fiscal Fiscal Disparities Total Tax Taxable
Disparities Pool Distribution Capacity Value Value
(1,011,274)$ 3,371,993$ 16,625,461$ 65.876 %1,311,752,463$ 1.27 %
(1,002,736) 3,397,197 18,309,416 61.455 1,475,969,866 1.24
(953,101) 3,424,887 19,652,810 59.239 1,601,441,554 1.23
(1,039,820) 3,607,141 20,620,233 58.760 1,685,287,604 1.22
(1,061,204) 3,721,925 22,081,209 57.161 1,810,826,485 1.22
(1,080,604) 3,892,519 23,748,236 54.372 1,968,969,293 1.21
(1,074,146) 4,219,127 25,295,301 50.971 2,093,214,877 1.21
(996,932) 4,468,538 27,348,467 49.251 2,247,736,496 1.22
(1,186,065) 4,774,320 28,543,281 50.623 2,357,314,320 1.21
(1,099,790) 4,756,013 34,453,465 42.933 2,893,627,784 1.19
Rate
Tax Capacity
Value as a
Percentage of
Actual Value
Total Direct
Tax Capacity
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Total Direct
and
Debt Total Dakota Other Special Overlapping
Operating Service City County ISD No. 192 Districts Tax Rate
47.308 18.568 65.876 31.820 56.300 4.150 158.146
44.964 16.491 61.455 29.625 53.460 3.741 148.281
44.220 15.019 59.239 28.562 57.570 3.802 149.173
44.050 14.710 58.760 27.996 54.256 3.692 144.704
42.451 14.710 57.161 26.573 52.813 3.203 139.750
43.721 10.651 54.372 25.379 51.390 2.983 134.124
N/A N/A 50.971 24.126 53.095 2.880 131.072
38.300 10.951 49.251 22.710 50.796 2.764 125.521
42.649 7.974 50.623 21.630 49.481 2.412 124.146
37.071 5.862 42.933 18.816 38.497 2.065 102.311
N/A – Not Available
(1)
(2)
Source:Dakota County
2019
2018
Overlapping rates are those of local and county governments that apply to property owners within the City.Not all
overlapping rates apply to all of the City’s property owners.
Information reflects total tax rates levied by each entity.Tax rates are expressed in terms of “net tax capacity.”A
property’s tax capacity is determined by multiplying its taxable market value by a state determined class rate.Class
rates vary by property type and change periodically based on state legislation.
2020
2021
2022
2023
CITY OF FARMINGTON
Property Tax Rates (1)
Direct and Overlapping Governments
Last Ten Fiscal Years
City Direct Rates Overlapping Rates (2)
2017
Year
Fiscal
2016
2015
2014
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Net Tax Net Tax
Capacity Capacity
Taxpayer Value Rank Value Rank
Northern Natural Gas 1,190,322$ 1 3.85 %424,534$ 1 2.95 %
Xcel Energy (Northern States Power)129,188 2 0.42 180,474 2 1.25
Legacy Partners of Farmington, LLC 109,829 3 0.36 – – –
Dakota Storage, LLC 106,402 4 0.34 81,608 5 0.57
Valmont Industries 99,944 5 0.32 – –
Dakota Electric Association 98,816 6 0.32 130,672 3 0.91
Minnesota Energy Resources 92,886 7 0.30 – – –
Seeger Properties LLC 89,287 8 0.29 – – –
RLR Investments, LLC 84,058 9 0.27 68,204 6 0.47
POR-MKR Real Estate, LLC 75,536 10 0.24 65,936 8 0.46
Farmington City Center LLC – – – 86,348 4 0.60
St. Francis Health Systems – – – 67,253 7 0.47
RoundBank – – – 63,729 9 0.44
Schwiness LLC – – – 63,322 10 0.44
Total 2,076,268$ 6.72 %1,232,080$ 8.57 %
Source: Dakota County
2023 2014
Current Fiscal Year and Nine Years Prior
Principal Property Taxpayers
CITY OF FARMINGTON
Percentage
of Total
City Tax
Capacity
Value
Percentage
of Total
City Tax
Capacity
Value
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Total Tax Delinquent
Levy for Tax
Fiscal Year (1)Amount Collections (2)Amount
10,981,055$ 10,889,973$ 99.17 %87,444$ 10,977,417$ 99.97 %
11,402,145 11,307,924 99.17 91,699 11,399,623 99.98
11,718,018 11,656,384 99.47 60,558 11,716,942 99.99
12,133,656 12,073,701 99.51 59,735 12,133,436 100.00
12,681,188 12,601,932 99.38 78,074 12,680,006 99.99
13,020,768 12,950,561 99.46 68,284 13,018,845 99.99
13,036,578 12,967,610 99.47 65,179 13,032,789 99.97
13,546,213 13,476,144 99.48 47,227 13,523,371 99.83
14,383,924 14,309,308 99.48 51,565 14,360,873 99.84
15,157,495 15,063,278 99.38 – 15,063,278 99.38
(1)
(2)
Source:
2021
Includes fiscal disparity revenues.
Includes fiscal disparity revenues and is net of county/state adjustments.
Dakota County
2020
2022
2023
Percentage
of
Levy
2019
2018
2017
Year
Fiscal
2016
2015
Percentage
2014
of
Levy
CITY OF FARMINGTON
Property Tax Levies and Collections
Last Ten Fiscal Years
Total Collections to Date
Collected Within the
Fiscal Year of Levy (2)
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General Special Certificates Net
Obligation Assessment of Premiums Lease
Bonds Bonds Indebtedness (Discounts)Liabilities
14,520,696$ 15,630,000$ 785,000$ 177,829$ –$
16,496,534 13,930,000 660,000 277,972 –
20,115,000 15,645,000 535,000 738,645 –
12,455,000 7,455,000 – 645,061 –
9,155,000 5,575,000 – 551,475 –
8,865,000 4,355,000 – 532,060 –
7,550,000 2,760,000 1,105,000 578,829 –
6,655,000 1,500,000 1,105,000 447,152 –
9,370,000 445,000 905,000 668,370 83,029
8,400,000 – 695,000 544,915 716,171
N/A – Not Applicable
Note 1:
Note 2:
CITY OF FARMINGTON
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
2023
2016
2015
2014
Fiscal Year
2017
Governmental Activities
2018
2019
2020
2021
2022
Details regarding the City’s outstanding debt can be found in the notes to basic financial statements.
See Demographic and Economic Statistics schedule for population and personal income information.
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Net Total
Revenue Premiums Lease Primary
Bonds (Discounts)Liabilities Government Per Capita
–$ –$ –$ 31,113,525$ 1,386$ 2.7 %
– – – 31,364,506 1,386 2.6
– – – 37,033,645 1,650 3.0
– – – 20,555,061 920 1.6
– – – 15,281,475 682 1.1
720,000 90,856 – 14,562,916 636 1.0
655,000 80,944 – 12,729,773 551 0.9
595,000 71,032 951,551 11,324,735 479 0.7
530,000 61,121 922,305 12,984,825 549 N/A
465,000 51,207 828,121 11,700,414 493 N/A
Income
of Personal
Percentage
Business-Type Activities
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Less Amounts
General Restricted for Market
Obligation Repaying Value of
Bonds (1)Principal Total Property
14,520,696$ 852,842$ 13,667,854$ 1,311,752,463$ 1.04 %
16,496,534 1,157,993 15,338,541 1,475,969,866 1.04
20,115,000 7,894,089 12,220,911 1,601,441,554 0.76
12,455,000 2,167,387 10,287,613 1,685,287,604 0.61
9,155,000 1,588,980 7,566,020 1,810,826,485 0.42
8,865,000 1,651,796 7,213,204 1,968,969,293 0.37
7,550,000 1,255,057 6,294,943 2,093,214,877 0.30
6,961,052 1,296,028 5,665,024 2,247,736,496 0.25
9,945,146 1,130,750 8,814,396 2,357,314,320 0.37
9,639,915 2,100,445 7,539,470 2,893,627,784 0.26
(1)
(2)
Note:
Source:
2021
2020
Percentage of
Market Value of
Property
2019
2018
CITY OF FARMINGTON
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years
Fiscal
Dakota County website and Dakota County Assessor’s Office
Includes all general obligations of the City,including Capital Improvement Plan Bonds and Certificates of
Indebtedness.
2017
Year
See Demographic and Economic Statistics schedule for population and personal income information.
Details regarding the City’s outstanding debt can be found in the notes to basic financial statements.
2016
2015
2014
N/A – Not Available
2022
2023
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Total City
Tax Capacity Per
Value Population (2)Capita
14,383,917$ 95.02 %22,446 1.24 %609$
16,028,316 95.70 22,622 1.32 678
17,298,609 70.65 22,451 1.38 544
18,171,280 56.61 22,343 1.41 460
19,457,656 38.88 22,421 1.43 337
21,083,287 34.21 22,880 1.49 315
22,295,554 28.23 23,123 1.49 272
23,983,304 23.62 23,632 1.49 240
25,059,264 35.17 23,654 N/A 373
30,905,790 24.40 23,719 N/A 318
Percentage of
Total City
Tax Capacity
Value
Percentage
of Personal
Income (2)
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Estimated
Share of
Net Debt Overlapping
Outstanding Debt
Overlapping debt
Dakota County CDA 70,055,000$ 4.238 %2,968,779$
ISD No. 192, Farmington 114,450,000 59.090 67,628,548
ISD No. 196, Rosemount–Apple Valley–Eagan 385,260,000 11.607 44,717,113
Metropolitan Council (2)238,225,000 4.250 10,124,881
Total overlapping debt 807,990,000 125,439,320
Direct debt
City of Farmington direct debt 10,356,086 100.000 10,356,086
Total direct and overlapping debt 818,346,086$ 135,795,406$
(1)
(2)
Note:
Source:Dakota County Property Taxation Office
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 City’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.
CITY OF FARMINGTON
Direct and Overlapping Governmental Activities Debt
December 31, 2023
Governmental Unit
The percentage of overlapping debt applicable is estimated using tax capacity.Applicable percentages were
estimated by determining the portion of the governmental unit’s tax capacity that is within the City’s boundaries
and dividing it by the governmental unit’s total tax capacity.
The above debt includes all outstanding general obligation debt of the Metropolitan Council supported by taxes.
The Metropolitan Council also has general obligation sewer revenue,wastewater revenue,and radio revenue bonds
and lease obligations outstanding,all of which are supported entirely by revenues and are not included in the
overlapping debt or debt ratios sections above.
Estimated
Percentage
Applicable (1)
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Fiscal Year
2014 2015 2016 2017
Debt limit 39,352,574$ 44,279,096$ 48,043,247$ 50,558,628$
Total net debt applicable to the limit 14,520,696 16,496,534 20,115,000 12,455,000
Legal debt margin 24,831,878$ 27,782,562$ 27,928,247$ 38,103,628$
Total net debt applicable to the limit
as a percentage of debt limit 36.90% 37.26% 41.87% 24.63%
CITY OF FARMINGTON
Legal Debt Margin Information
Last Ten Fiscal Years
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2018 2019 2020 2021 2022 2023
54,324,795$ 59,069,079$ 62,796,446$ 67,432,095$ 70,719,430$ 86,808,834$
9,155,000 8,865,000 8,655,000 7,760,000 10,275,000 9,095,000
45,169,795$ 50,204,079$ 54,141,446$ 59,672,095$ 60,444,430$ 77,713,834$
16.85% 15.01% 13.78% 11.51% 14.53% 10.48%
Market value 2,893,627,784$
Debt limit (3% of market value)86,808,834
Debt applicable to the limit 9,095,000
Legal debt margin 77,713,834$
Legal Debt Margin Calculations for Fiscal Year 2023
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Less
Direct Net Revenue
Gross Operating Available for
Revenue (a)Expenses (b)Debt Service Principal Interest Total
2,281,793$ (556,474)$ 1,725,319$ –$ –$ –$ N/A
2,533,753 (613,141) 1,920,612 65,000 39,916 104,916 1,830.62 %
2,908,352 (755,497) 2,152,855 60,000 29,550 89,550 2,404.08
2,238,210 (805,909) 1,432,301 65,000 26,426 91,426 1,566.62
2,496,686 (871,659) 1,625,027 65,000 23,175 88,175 1,842.96
(a)
(b)
Note:
2021
Fiscal years 2019–2023 include gross revenues of the Water Fund.
Exclusive of depreciation.
Details regarding the City’s outstanding debt can be found in the notes to basic financial statements.
N/A – Not Applicable
2022
2023
Coverage
2020
2019
2018 No revenue bonds outstanding from 2013–2018
2017 No revenue bonds outstanding from 2013–2018
No revenue bonds outstanding from 2013–2018
No revenue bonds outstanding from 2013–2018
No revenue bonds outstanding from 2013–2018
2016
2015
2014
Year
Pledged Revenue Coverage
CITY OF FARMINGTON
Debt Service RequirementsFiscal
Last Ten Fiscal Years
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Total
School Unemployment Personal Per Capita
Population (1)Households (1)Enrollment (3)Rate (2)Income (5)Income (4)
22,446 7,906 7,075 3.1 1,159,941,942$ 51,677$
22,622 7,959 7,019 3.3 1,215,027,620 53,710
22,451 7,657 7,074 3.4 1,251,486,093 55,743
22,343 7,691 7,126 2.7 1,287,805,834 57,638
22,421 7,779 7,138 2.7 1,357,344,919 60,539
22,880 7,925 7,143 3.0 1,418,033,760 61,977
23,123 7,926 6,996 4.3 1,497,168,004 64,748
23,632 7,906 6,825 2.4 1,605,250,864 67,927
23,654 7,936 6,853 2.5 N/A N/A
23,719 8,011 6,767 2.2 N/A N/A
(1)
(2)
(3)
(4)
(5)
2023
N/A – Not Available
Per capita personal income for Dakota County residents multiplied by the estimated city population.
CITY OF FARMINGTON
Demographic and Economic Statistics
Last Ten Fiscal Years
2014
Year
Fiscal
2015
Numbers for 2014–2015 are from the Farmington Building Inspections Department.The 2016–2023 numbers are
from the Metropolitan Council,which uses a more scientific and in-depth approach to estimating these values.They
also have a one-year lag in reporting.
Minnesota Department of Employment and Economic Development – Dakota County Annual Rate.
ISD No. 192, Farmington Public Schools – October enrollment count.
U.S. Bureau of Economic Analysis – Per capita personal income for Dakota County residents.
2016
2022
2017
2018
2019
2020
2021
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Employees Employees
(1)Rank (1)Rank
ISD No. 192, Farmington Public Schools 839 1 17.3 %900 1 19.7 %
Federal Aviation Administration 366 2 7.5 400 2 8.8
Installed Building Solutions 284 3 5.9 – – –
Trinity Care Center and Trinity Terrace 215 4 4.4 – – –
Marschall Line, Inc.202 5 4.2 182 4 4.0
City of Farmington 193 6 4.0 91 9 2.0
Dakota Electric Association 191 7 3.9 200 3 4.4
R&L Carriers 160 8 3.3 110 7 2.4
Valmont Industries 134 9 2.8 130 6 2.9
Kemps Dairy 130 10 2.7 131 5 2.9
River Valley Home Care – – – 110 8 2.4
JIT Powder Coating – – – 65 10 1.4
Total 2,714 56.0 %2,319 50.9 %
(1)
(2)
Per City of Farmington records.
Metropolitan Council Employment by Community as of 2022 (latest available), 4,849 total employment.
Current Fiscal Year and Nine Years Prior
Principal Employers
CITY OF FARMINGTON
2023
Taxpayer (2)
Employment
of Total
Employment
of Total
Percentage
Percentage
2014
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Fiscal Year
2014 2015 2016 2017
General government
Administration 3.50 3.00 2.00 1.00
Finance 4.00 4.50 5.50 5.50
Human resources/information
technology/communications 3.00 3.00 3.00 4.00
Community development 2.50 2.50 3.00 3.00
Total general government 13.00 13.00 13.50 13.50
Public safety
Police administration 5.15 5.15 5.15 5.15
Police patrol 17.00 17.00 17.00 17.00
Investigations 5.00 5.00 5.00 5.00
Fire 1.40 1.50 1.50 1.50
Total public safety 28.55 28.65 28.65 28.65
Public works
Building inspections 2.50 2.50 3.20 3.50
Engineering 4.60 4.50 4.50 5.50
Streets 10.00 9.00 9.50 9.50
Natural resources 1.00 1.00 1.00 –
Total public works 18.10 17.00 18.20 18.50
Parks and recreation
Park maintenance 3.50 3.50 3.50 3.60
Building maintenance 1.00 1.00 1.00 1.00
Recreation programming 2.00 2.00 2.00 2.00
Total parks and recreation 6.50 6.50 6.50 6.60
Senior center 1.50 1.00 1.40 1.40
Swimming pool 0.40 0.40 0.40 0.40
Arena 2.35 2.35 2.35 2.35
Liquor operations 7.50 8.00 8.00 8.00
Solid waste 5.00 5.00 5.50 5.50
Fleet 2.00 2.00 2.00 2.00
Total employees 84.90 83.90 86.50 86.90
Note:
Source:
CITY OF FARMINGTON
Full-Time Equivalent City Government Employees by Function
Last Ten Fiscal Years
In addition to the above,the City has a volunteer fire department of 50 people and hires seasonal staff for its
summer parks and recreation operations.
Various city departments
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2018 2019 2020 2021 2022 2023
1.00 1.00 1.00 2.00 2.00 2.00
5.50 5.50 5.50 5.50 5.50 4.50
5.00 5.00 5.00 5.00 6.00 6.00
4.00 5.00 4.00 4.00 3.00 4.00
15.50 16.50 15.50 16.50 16.50 16.50
5.00 5.00 5.00 5.00 5.00 5.00
15.00 16.00 17.00 17.00 18.00 19.00
6.00 6.00 6.00 6.00 6.00 6.00
1.00 2.00 2.00 2.00 2.00 2.00
27.00 29.00 30.00 30.00 31.00 32.00
3.50 3.00 4.00 4.00 5.00 5.00
4.50 5.00 5.00 5.00 5.00 6.00
9.00 10.00 10.00 10.00 9.50 10.00
1.00 1.00 – – 1.00 1.00
18.00 19.00 19.00 19.00 20.50 22.00
4.00 4.00 4.00 4.00 7.00 7.00
1.00 3.00 3.00 3.00 3.00 3.00
2.00 2.00 2.00 2.00 2.00 2.00
7.00 9.00 9.00 9.00 12.00 12.00
1.00 1.00 1.50 1.50 1.50 1.50
– – – – – –
2.00 2.00 2.00 2.00 1.50 1.50
9.50 9.00 13.00 13.00 13.00 13.00
5.50 5.00 5.00 5.00 – –
2.00 2.00 2.00 2.00 2.00 2.00
87.50 92.50 97.00 98.00 98.00 100.50
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2014 2015 2016 2017
General government
Elections 1 N/A 1 N/A
Registered voters 12,541 N/A 13,788 N/A
Number of votes cast 6,419 N/A 11,545 N/A
Voter participation (registered) 51.0%N/A 84.0%N/A
Public safety
Police
Arrests 266 153 351 281
All citations and warnings 3,383 2,494 2,070 2,021
Calls for service 13,035 12,085 11,943 11,221
Fire
Medical calls 386 359 356 452
Fire calls 241 361 345 407
Inspections
Building permits 711 619 1,184 1,036
Value of building permits (in millions)24$ 15$ 38$ 19$
Parks and recreation
Parks
Park reservations 66 66 81 71
Pool (closed after 2017)
Pool open swim admissions 8,032 7,652 7,372 6,302
Pool swim lesson registrations 267 256 309 136
Pool season passes sold N/A N/A NA N/A
Pool punch cards sold 193 176 125 139
Swim bus riders 408 536 507 496
Rambling River Center
Memberships 406 381 404 467
Program participation 15,285 13,885 13,042 15,203
Number of volunteers 130 107 82 80
Total volunteer hours 4,348 5,944 8,573 4,298
Ice arena
Ice skating lessons total participants 230 216 329 284
Arena rental hours 1,197 1,315 1,285 1,490
Outdoor rinks total number of skaters 7,481 7,851 5,187 7,276
Other
Recreation program/event participants 6,425 5,976 8,344 8,171
Youth scholarships provided 7 4 6 8
Source:
CITY OF FARMINGTON
Operating Indicators by Function
Last Ten Years
Various city departments
Function/Program
N/A – Not Available
Fiscal Year
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2018 2019 2020 2021 2022 2023
1 N/A 1 N/A 1 N/A
13,403 N/A 14,736 N/A 14,480 N/A
9,632 N/A 12,102 N/A 9,479 N/A
72.0%N/A 82.0%N/A 65.0%N/A
284 253 232 268 230 222
2,484 2,176 2,319 1,982 2,434 2,552
13,033 14,005 15,413 11,361 13,567 13,564
411 480 467 712 747 714
340 370 284 353 465 436
1,059 1,049 1,318 1,705 1,155 1,960
26$ 22$ 27$ 40$ 42$ 53$
64 59 – 78 85 71
– – – – – –
– – – – – –
– – – – – –
– – – – – –
– – – – – –
497 372 305 471 399 371
16,015 17,730 3,651 8,728 11,777 15,273
69 74 31 57 65 52
3,426 3,749 347 1,732 2,135 1,932
296 310 122 221 211 155
1,380 1,390 1,191 1,641 1,537 1,546
5,451 3,892 4,209 4,142 6,115 4,694
7,034 5,657 361 5,927 6,746 7,397
1 – – 1 2 5
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Function/Program 2014 2015 2016 2017
Public safety
Police
Stations 1 1 1 1
Patrol squads 16 16 15 15
Fire
Stations 2 2 2 2
Fire trucks 6 6 8 8
Public works
Vehicles 21 24 29 29
Streets (miles)89 89 89 89
Parks and recreation
Senior center – building 1 1 1 1
Swimming pool (closed after 2017)1 1 1 1
Ice arena – building 1 1 1 1
Parks 23 23 23 23
Solid waste
Compactor trucks 5 5 5 5
Sanitary sewer
Collection system (miles)84 84 84 90
Storm sewer
Storm sewer (miles)71 73 73 78
Water
Water main (miles)109 109 109 113
Wells 7 7 7 7
Water reservoirs 2 2 2 2
Source: The City’s financial records
Fiscal Year
CITY OF FARMINGTON
Capital Assets Statistics by Function/Program
Last Ten Years
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2018 2019 2020 2021 2022 2023
1 1 1 1 1 1
16 19 19 19 21 18
2 2 2 2 2 2
8 8 8 8 8 5
29 30 31 31 28 27
89 89 90 90 90 92
1 1 1 1 1 1
– – – – – –
1 1 1 1 1 1
24 26 26 26 27 27
5 5 6 6 – –
90 87 90 92 94 97
78 78 81 84 85 86
113 113 116 119 121 123
7 8 9 9 9 9
2 2 2 2 2 2
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Management Report
for
City of Farmington, Minnesota
December 31, 2023
Page 309 of 352
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Page 310 of 352
To the City Council and Management
City of Farmington, Minnesota
We have prepared this management report in conjunction with our audit of the City of Farmington,
Minnesota’s (the City) financial statements for the year ended December 31, 2023. We have organized
this report into the following sections:
•Audit Summary
•Governmental Funds Overview
•Enterprise Funds Overview
•Government-Wide Financial Statements
•Accounting and Auditing Updates
We would be pleased to further discuss any of the information contained in this report or any other
concerns that you would like us to address. We would also like to express our thanks for the courtesy and
assistance extended to us during our audit.
The purpose of this report is solely to provide those charged with governance of the City, management,
and those who have responsibility for oversight of the financial reporting process comments resulting
from our audit process and information relevant to city finances in Minnesota. Accordingly, this report is
not suitable for any other purpose.
Minneapolis, Minnesota
June 20, 2024
C E R T I F I E D
A C C O U N T A N T S
P UBLIC
PRINCIPALS
Thomas A. Karnowski, CPA
Paul A. Radosevich, CPA
William J. Lauer, CPA
James H. Eichten, CPA
Aaron J. Nielsen, CPA
Victoria L. Holinka, CPA/CMA
Jaclyn M. Huegel, CPA
Kalen T. Karnowski, CPA
Malloy, Montague, Karnowski, Radosevich & Co., P.A.
5353 Wayzata Boulevard • Suite 410 • Minneapolis, MN 55416 • Phone: 952-545-0424 • Fax: 952-545-0569 • www.mmkr.com
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AUDIT SUMMARY
The following is a summary of our audit work, key conclusions, and other information that we consider
important or that is required to be communicated to the City Council, administration, or those charged
with governance of the City.
OUR RESPONSIBILITY UNDER AUDITING STANDARDS GENERALLY ACCEPTED IN THE UNITED
STATES OF AMERICA AND GOVERNMENT AUDITING STANDARDS
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 as of and for the year ended
December 31, 2023. Professional standards require that we provide you with information about our
responsibilities under auditing standards generally accepted in the United States of America and
Government Auditing Standards, as well as certain information related to the planned scope and timing of
our audit. We have communicated such information to you verbally and in our audit engagement letter.
Professional standards also require that we communicate the following information related to our audit.
PLANNED SCOPE AND TIMING OF THE AUDIT
We performed the audit according to the planned scope and timing previously discussed and coordinated
in order to obtain sufficient audit evidence and complete an effective audit.
AUDIT OPINIONS AND FINDINGS
Based on our audit of the City’s financial statements for the year ended December 31, 2023:
• We have issued unmodified opinions on the City’s basic financial statements.
• We reported no deficiencies involving the City’s internal control over financial reporting that we
consider to be material weaknesses.
• The results of our testing disclosed no instances of noncompliance that are required to be reported
under Governmental Auditing Standards.
• We reported one finding based on our testing of the City’s compliance with Minnesota laws and
regulations. We noted for one contract awarded during the year, the City did comply with
statutory requirements to award the contract based on publicly solicited sealed bids, and did not
obtain performance or payment bonds as required.
FOLLOW-UP ON PRIOR YEAR FINDINGS AND RECOMMENDATIONS
As a part of our audit of the City’s financial statements for the year ended December 31, 2023, we
performed procedures to follow-up on the findings and recommendations that resulted from our prior year
audit. We reported the following findings that were corrected by the City in the current year:
• In previous years, we have reported a material internal control weakness due to a lack of
segregation of duties in payroll and other areas. We concluded that the City has implemented
sufficient mitigating controls in recent years to eliminate this finding.
• In 2022, the City recorded a material prior period adjustment to record certain
development-related revenues that should have been recognized in previous years, which was
considered a material weakness in internal control. There was no similar finding in the current
year.
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SIGNIFICANT ACCOUNTING POLICIES
Management is responsible for the selection and use of appropriate accounting policies. The significant
accounting policies used by the City are described in Note 1 of the notes to basic financial statements. No
new accounting policies were adopted and the application of existing policies was not changed during the
year ended December 31, 2023.
We noted no transactions entered into by the City during the year for which there is a lack of authoritative
guidance or consensus. All significant transactions have been recognized in the financial statements in the
proper period.
ACCOUNTING ESTIMATES AND MANAGEMENT JUDGMENTS
Accounting estimates are an integral part of the financial statements prepared by management and are
based on management’s knowledge and experience about past and current events and assumptions about
future events. Certain accounting estimates are particularly sensitive because of their significance to the
financial statements and because of the possibility that future events affecting them may differ
significantly from those expected. The most sensitive estimates affecting the financial statements were:
• Other Post-Employment Benefits (OPEB) and Pension Benefits – The City has recorded
liabilities and activity for pension benefits and OPEB. These obligations are calculated using
actuarial methodologies described in Governmental Accounting Standards Board Statement
Nos. 68 and 75. These actuarial calculations include significant assumptions, including projected
changes, healthcare insurance costs, investment returns, retirement ages, proportionate share, and
employee turnover.
• Depreciation/Amortization – Management’s estimates of depreciation/amortization expense are
based on the estimated useful lives of the assets.
• Compensated Absences – Management’s estimate is based on current rates of pay, compensated
absence balances, and the likelihood that sick leave will ultimately be paid at termination.
We evaluated the key factors and assumptions used by management to develop these estimates in
determining that they are reasonable in relation to the basic financial statements taken as a whole.
Certain financial statement disclosures are particularly sensitive because of their significance to financial
statement users. The disclosures included in the notes to the basic financial statements related to OPEB
and pension benefits are particularly sensitive, due to the materiality of the liabilities, and the large and
complex estimates involved in determining the disclosures.
The financial statement disclosures are neutral, consistent, and clear.
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
Professional standards require us to accumulate all known and likely misstatements identified during the
audit, other than those that are clearly trivial, and comm unicate them to the appropriate level of
management. Management has corrected all such misstatements. In addition, none of the misstatements
detected as a result of audit procedures and corrected by management were material, either individually or
in the aggregate, to each opinion unit’s financial statements taken as a whole.
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DISAGREEMENTS WITH MANAGEMENT
For purposes of this report, a disagreement with management is a financial accounting, reporting, or
auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial
statements or the 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 June 20, 2024.
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 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.
OTHER MATTERS
We applied certain limited procedures to the management’s discussion and analysis (MD&A) and the
pension and OPEB-related required supplementary information (RSI) that supplements the basic financial
statements. Our procedures consisted of inquiries of management regarding the methods of preparing th e
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, as described in the table of contents, which
accompanies the financial statements, but is 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 and statistical sections, which accompany the financial
statements, but are not RSI. Such information has not been subjected to the auditing procedures applied in
the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any
assurance on it.
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GOVERNMENTAL FUNDS OVERVIEW
This section of the report provides you with an overview of the financial trends and activities of the City’s
governmental funds, which includes the General, special revenue, debt service, and capital project funds.
These funds are used to account for the basic services the City provides to all of its citizens, which are
financed primarily with property taxes. The governmental fund information in the City’s financial
statements focuses on budgetary compliance and the sufficiency of each governmental fund’s current
assets to finance its current liabilities.
PROPERTY TAXES
Minnesota cities rely heavily on local property tax levies to support their governmental fund activities.
For the 2021 fiscal year (the most recent comparative state -wide data available), local ad valorem
property tax levies provided 44.0 percent of the total governmental fund revenues for cities over 2,500 in
population, and 35.5 percent for cities under 2,500 in population. Total property taxes levied by all
Minnesota cities for taxes payable in 2023 increased 4.2 percent compared to the prior year, and
7.5 percent for taxes payable in 2024.
The taxable net tax capacity value of property in Minnesota cities increased about 17.7 percent for the
2023 levy year. The tax capacity values used for levying property taxes are based on the assessed market
values for the previous fiscal year (e.g., tax capacity values for taxes levied in 2023 were based on
assessed market values as of January 1, 2022), so the trend of change in these tax capacit y values lags
somewhat behind the housing market and economy in general.
The City’s taxable market value increased 4.9 percent for taxes payable in 2022 and 22.8 percent for taxes
payable in 2023. The following graph shows the City’s changes in taxable market value over the past
10 years:
$–
$300,000,000
$600,000,000
$900,000,000
$1,200,000,000
$1,500,000,000
$1,800,000,000
$2,100,000,000
$2,400,000,000
$2,700,000,000
$3,000,000,000
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Taxable Market Value
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Tax capacity is considered the actual base available for taxation. It is calculated by applying the state’s
property classification system to each property’s market value. Each property classification, such as
commercial or residential, has a different calculation and uses different rates. Consequently, a city’s total
tax capacity will change at a different rate than its total market value, as tax capacity is affected by the
proportion of its tax base that is in each property classification from year -to-year, as well as legislative
changes to tax rates. The City’s tax capacity increased 4.4 percent and 20.7 percent for taxes payable in
2022 and 2023, respectively.
The following graph shows the City’s change in tax capacities over the past 10 years:
$–
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Local Net Tax Capacity
The following table presents the average tax rates applied to city residents for each of the last three levy
years:
2021 2022 2023
Average tax rate
City 49.3 50.6 42.9
County 22.7 21.6 18.8
School 50.8 49.5 38.5
Special taxing 2.7 2.4 2.1
Total 125.5 124.1 102.3
Rates Expressed as a Percentage of Net Tax Capacity
City of Farmington
Despite the City historically having a higher dependence on property taxes than the average Minnesota
city, the overall tax rate on Farmington residents has been declining in recent years, due to the increasing
taxable market value of property within the City.
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GOVERNMENTAL FUND BALANCES
The following table summarizes the changes in the fund balances of the City’s governmental funds during
the year ended December 31, 2023, presented both by fund balance classification and by major fund:
2023 2022 Change
Fund balances of governmental funds
Total by classification
Nonspendable 15,883$ 4,135$ 11,748$
Restricted 5,007,682 4,799,381 208,301
Committed 13,191,023 13,005,454 185,569
Assigned 1,598,024 – 1,598,024
Unassigned 8,539,162 7,656,950 882,212
Total governmental funds 28,351,774$ 25,465,920$ 2,885,854$
Total by fund
General 8,988,437$ 7,831,517$ 1,156,920$
Federal Aid Special Revenue (7,246) (82,501) 75,255
Private Capital Projects 125,825 42,300 83,525
Storm Water Trunk Capital Projects 5,368,207 4,703,897 664,310
Closed Bond Debt Service 1,598,024 – 1,598,024
Nonmajor 12,278,527 12,970,707 (692,180)
Total governmental funds 28,351,774$ 25,465,920$ 2,885,854$
as of December 31,
Governmental Funds Change in Fund Balances
Fund Balance
In total, the fund balances of the City’s governmental funds increased by $2,885,854 during the year
ended December 31, 2023.
The increase in restricted fund balance of $208,301 is mainly due to a new state public safety aid received
during the year in the nonmajor Public Safety Special Revenue Fund.
Committed fund balances relate primarily to resources accumulated for capital improvements. The
increase of $185,569 was mainly due to increases in the various utility trunk and maintenance capital
projects funds, partially offset by the spend down of resources for completion of the Spruce Street
reconstruction project.
The increase in assigned fund balances of $1,598,024 is from the transfer of previously restricted
resources from fully matured or retired bond accounts in the Debt Service Fund to establish the Closed
Bond Debt Service Fund, where they are assigned for future debt service.
Unassigned fund balances also increased $882,212, which is attributable to positive operating results in
the General Fund.
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GOVERNMENTAL FUNDS REVENUE AND EXPENDITURES
The following table presents the per capita revenue of the City’s governmental funds for the past
three years, along with state-wide averages.
We have included the most recent comparative state-wide averages available from the Office of the State
Auditor to provide a benchmark for interpreting the City’s data. The amounts received from the typical
major sources of governmental fund revenue will naturally vary between cities based on factors such as a
city’s stage of development, location, size and density of its population, property values, services it
provides, and other attributes. It will also differ from year -to-year, due to the effect of inflation and
changes in its operation. Also, certain data in these tables may be classified differently than how they
appear in the City’s financial statements in order to be more comparable to the state-wide information,
particularly in separating capital expenditures from current expenditures.
We have designed this section of our management report using per capita data in order to better identify
unique or unusual trends and activities of the City. We intend for this type of comparative and trend
information to complement, rather than duplicate, information in the MD&A. An inherent difficulty in
presenting per capita information is the accuracy of the population count, which for most years is based
on estimates.
Year 2021 2022 2023
Population 10,000–20,000 20,000–100,000 23,632 23,654 23,719
Property taxes 529$ 557$ 574$ 605$ 638$
Tax increments 36 49 6 5 5
Franchise and other taxes 66 53 10 10 8
Special assessments 41 56 12 23 22
Licenses and permits 46 53 33 35 39
Intergovernmental revenues 293 202 53 54 208
Charges for services 111 110 72 96 86
Other 39 26 24 (4) 75
Total revenue 1,161$ 1,106$ 784$ 824$ 1,081$
December 31, 2021
City of FarmingtonState-Wide
Governmental Funds Revenue per Capita
With State-Wide Averages by Population Class
The City’s governmental fund revenues for 2023 were $25,648,868, an increase of $6,159,138
(31.6 percent), or $257 per capita, from the prior year. Property tax revenue was $33 per capita more than
last year, due a tax levy increase. Intergovernmental revenue increased $154 per capita, due to increases
in federal grant usage and state aid for street improvements, along with a new state public safety aid
received during the year. Other revenue was $79 per capita more than last year, mainly due to improved
investment earnings from higher interest rates and fair value increase of the City’s investment portfolio.
The City historically receives a larger proportion of its governmental fund revenue from property taxes
than the average Minnesota city.
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The expenditures of governmental funds will also vary from state-wide averages and from year-to-year,
based on the City’s circumstances. Expenditures are classified into three types as follows:
• Current – These are typically the general operating type expenditures occurring on an annual
basis, and are primarily funded by general sources, such as taxes and intergovernmental revenues.
• Capital Outlay and Construction – These expenditures do not occur on a consistent basis, more
typically fluctuating significantly from year-to-year. Many of these expenditures are
project-oriented and are often funded by specific sources that have benefited from the
expenditure, such as special assessment improvement projects.
• Debt Service – Although the expenditures for debt service may be relatively consistent over the
term of the respective debt, the funding source is the important factor . Some debt may be repaid
through specific sources, such as special assessments or redevelopment funding, while other debt
may be repaid with general property taxes.
The City’s expenditures per capita of its governmental funds for the past three years, together with
state-wide averages, are presented in the following table:
Year 2021 2022 2023
Population 10,000–20,000 20,000–100,000 23,632 23,654 23,719
Current
131$ 116$ 114$ 135$ 176$
296 327 272 289 304
124 112 112 138 163
124 107 80 82 95
79 77 16 10 8
754 739 594 654 746
Capital outlay
and construction 407 317 129 168 239
Debt service
161 110 91 93 72
41 34 16 15 17
202 144 107 108 89
Total expenditures 1,363$ 1,200$ 830$ 930$ 1,074$
General government
Governmental Funds Expenditures per Capita
With State-Wide Averages by Population Class
December 31, 2021
City of FarmingtonState-Wide
Interest and fiscal charges
Public safety
Public works
Culture and recreation
All other
Principal
Total expenditures in the City’s governmental funds for 2023 were $25,444,415, an increase of
$3,436,562 (15.6 percent), or about $144 per capita, from the previous year. Current governmental
expenditures for 2023 were $192 per capita more than last year, mainly in the general government due to
increased federal grant spending, and public works due to increased street maintenance. Capital outlay
expenditures were $71 per capita more than last year due to increased street reconstruction. Debt service
expenditures decreased $19 per capita, due to the City’s continued efforts to reduce its debt load through
the internal financing of capital projects and early redemption of outstanding bonds in recent years.
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GENERAL FUND
The City’s General Fund accounts for the financial activity of the basic services provided to the
community. The primary services included within this fund are the administration of the municipal
operation, police and fire protection, building inspection, streets and highway maintenance, and parks and
recreation. The graph below illustrates the change in the General Fund financial position over the last
five years. We have also included a line representing annual expenditures and transfers out to reflect the
change in the size of the General Fund operation over the same period.
2019 2020 2021 2022 2023
Fund Balances $5,871,270 $6,202,066 $7,331,014 $7,831,517 $8,988,437
Cash (Net)$4,676,267 $4,837,575 $5,619,633 $6,635,513 $7,800,829
Exp and Trans Out $13,199,638 $14,840,260 $13,811,853 $15,595,683 $16,548,710
$–
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
General Fund Financial Position
Year Ended December 31,
The City’s General Fund cash and investments, net of interfund borrowing on December 31, 2023, was
$1,165,316 higher than at the previous year-end. Total fund balances at December 31, 2023 of $8,988,437
represented an increase of $1,156,920 from current year activity, as compared to a breakeven budget.
As the graph illustrates, the City has generally been able to maintain healthy cash and fund balance levels
as the volume of financial activity has grown. This is an important factor because a government, like any
organization, requires a certain amount of equity to operate. A healthy financial position allows the City
to avoid volatility in tax rates; helps minimize the impact of state funding changes; allows for t he
adequate and consistent funding of services, repairs, and unexpected costs; and is a factor in determining
the City’s bond rating and resulting interest costs. Maintaining an adequate fund balance has become
increasingly important given the fluctuations in state funding for cities in recent years.
A trend that is typical to Minnesota local governments, especially the General Fund of cities, is the
unusual cash flow experienced throughout the year. The City’s General Fund cash disbursements are
made fairly evenly during the year other than the impact of seasonal services, such as snowplowing, street
maintenance, and park activities. Cash receipts of the General Fund are quite a different story . Property
taxes comprise about 80.7 percent of the fund’s total annual revenue. Approximately half of these
revenues are received by the City in July and the rest in December. Consequently, the City needs to have
adequate cash reserves to finance its everyday operations between these payments.
The City’s unassigned General Fund balance of $8,987,268 at the end of the 2023 fiscal year represents
approximately 47.6 percent of budgeted expenditures and transfers out for 2024. This is within the City’s
policy that calls for maintaining an unassigned fund balance of between 40.0–50.0 percent of the
subsequent year’s budgeted expenditures and transfers out.
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The following graph reflects the City’s General Fund revenue sources for 2023 compared to budget:
All Other
Licenses and Permits
Charges for Services
Fines and Forfeits
Intergovernmental
Property Taxes
General Fund Revenue
Budget and Actual
Budget Actual
General Fund revenue for 2023 was $16,199,668, which was $812,619 (5.3 percent) more than budget.
Intergovernmental revenue exceeded budget by $228,849, mainly due to Municipal State Aid (MSA)
maintenance aid, police training aid, fire aid, and miscellaneous grant revenues. Charges for services were
$233,175 higher than budget, due to fire service charges and engineering fees exceeding a conservative
budget. Investment earnings (included in “all other” above) were $312,980 over budget, due to improved
interest rates and the fair value improvement recorded on the City’s investment portfolio. It should be
noted that the City’s practice is to hold investments to maturity, in which case these unrealized fair value
fluctuations would even out by the time the individual investments mature.
The following graph presents the City’s General Fund revenues by source for the last five years. The
graph reflects the City’s reliance on property taxes and other local sources of revenue:
Property
Taxes Intergovernmental Fines and
Forfeits
Charges for
Services
Licenses
and Permits All Other
2019 $9,714,270 $1,085,065 $63,561 $502,902 $421,578 $317,205
2020 $10,244,358 $2,261,674 $45,959 $419,761 $588,347 $303,387
2021 $10,555,567 $963,762 $52,340 $613,132 $789,965 $180,816
2022 $12,054,024 $984,811 $58,400 $696,870 $823,729 $50,419
2023 $13,070,482 $852,169 $57,509 $694,094 $927,731 $597,683
$–
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
$9,000,000
$10,000,000
$11,000,000
$12,000,000
$13,000,000
$14,000,000
General Fund Revenue by Source
Year Ended December 31,
Total General Fund revenue for 2023 was $1,531,415 (10.4 percent) higher than last year. Property tax
revenue increased $1,016,458 from last year, due to a higher certified tax levy. Licenses and permits
increased $104,002, mainly due to increases in building and utility permits. Investment earnings increased
$542,637 from the prior year, due to improved interest rates and market conditions.
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The following graph illustrates the components of General Fund spending for 2023 compared to budget:
Parks and Recreation
Public Works
Public Safety
General Government
General Fund Expenditures
Budget and Actual
Budget Actual
General Fund expenditures for 2023 were $14,906,688, which was $336,073 (2.2 percent) under budget.
Expenditures for public safety were $285,311 under budget in the current year, mainly due to unfilled
police positions during 2023. Public works expenditures were also under budget by $182,407, due
primarily to unfilled positions.
The following graph presents the City’s General Fund expenditures by function for the last five years:
General
Government Public Safety Public Works Parks and
Recreation
Economic
Development
2019 $2,369,885 $5,733,766 $2,605,435 $1,209,414 $50,000
2020 $2,695,928 $6,093,624 $2,484,231 $1,145,173 $40,000
2021 $2,620,186 $6,411,904 $2,474,368 $1,303,044 $–
2022 $2,994,602 $6,743,334 $2,769,231 $1,430,907 $–
2023 $3,127,328 $7,121,264 $3,033,932 $1,624,164 $–
$–
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
General Fund Expenditures by Function
Year Ended December 31,
Total General Fund expenditures for 2023 were $968,614 (7.0 percent) higher than the previous year,
with increases in each category shown above. Contractual salary increases, along with inflationary
increases to employee benefits, utilities, fuel and supply costs, and purchased services contributed to the
increase.
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ENTERPRISE FUNDS OVERVIEW
The City maintains several enterprise funds to account for services the City provides that are financed
primarily through fees charged to those utilizing the service. This section of the report provides you with
an overview of the financial trends and activities of the City’s enterprise funds, which include the Liquor
Operations, Sewer Operations, Solid Waste, Storm Water, Water, and Street Light funds.
ENTERPRISE FUNDS FINANCIAL POSITION
The following table summarizes the changes in the financial position of the City’s enterprise funds during
the year ended December 31, 2023, presented both by classification and by fund:
2023 2022 Change
Net position of enterprise funds
Total by classification
Net investment in capital assets 48,486,110$ 48,353,192$ 132,918$
Restricted – future drinking water
treatment plant 2,461,488 2,461,488 –
Unrestricted 21,351,782 18,266,640 3,085,142
Total enterprise funds 72,299,380$ 69,081,320$ 3,218,060$
Total by fund
Liquor Operations 2,444,814$ 2,035,800$ 409,014$
Sewer Operations 18,950,803 18,677,310 273,493
Solid Waste 1,465,089 1,872,667 (407,578)
Storm Water 15,912,822 14,755,806 1,157,016
Water 33,142,079 31,395,742 1,746,337
Street Light 383,773 343,995 39,778
Total enterprise funds 72,299,380$ 69,081,320$ 3,218,060$
Enterprise Funds Change in Financial Position
Net Position
as of December 31,
In total, the net position of the City’s enterprise funds increased by $3,218,060 during the year ended
December 31, 2023. The City’s net investment in capital assets increased by $132,918 during the year,
mainly due to infrastructure assets contributed to utility funds from street reconstruction projects
accounted for in governmental funds. All the City’s enterprise operations had positive operating results
for the year prior, excluding the Solid Waste Fund, which has been in the process of discontinuing
operations for the last two years. The enterprise funds transferred $1,865,816 to the governmental and
internal service funds during the year to support the General Fund, help finance capital improvements,
and contribute to the City’s emerald ash borer abatement program.
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LIQUOR OPERATIONS FUND
The following graph presents five years of comparative operating results for the City’s Liquor Operations
Fund:
2019 2020 2021 2022 2023
Sales $5,608,012 $5,347,194 $5,621,602 $6,387,611 $6,765,798
Cost of Sales $4,183,615 $3,984,504 $4,192,176 $4,728,067 $5,049,555
Oper Exp $1,073,621 $974,201 $1,064,135 $1,212,002 $1,162,539
Oper Income $350,776 $388,489 $365,291 $447,542 $553,704
$–
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
$4,500,000
$5,000,000
$5,500,000
$6,000,000
$6,500,000
$7,000,000
Liquor Operations Fund
Year Ended December 31,
The City’s Liquor Operations Fund ended 2023 with a total net position of $2,444,814, an increase of
$409,014 from the prior year. Of this, $199,946 represents the net investment in liquor capital assets,
leaving an unrestricted net position of $2,244,868.
The Liquor Operations Fund had gross sales of $6,765,798 in 2023, an increase of $378,187 (5.9 percent)
from the previous year. Gross profit was $1,716,243, about 25.4 percent of sales, which is consistent with
recent years.
Operating expenses for 2023 decreased $49,463 (4.1 percent) from the previous year.
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SEWER OPERATIONS FUND
The following graph presents five years of comparative operating results for the City’s Sewer Operations
Fund:
2019 2020 2021 2022 2023
Oper Rev $2,117,934 $2,160,808 $2,260,523 $2,607,594 $2,757,991
Oper Exp $2,310,312 $2,331,935 $2,474,696 $2,604,412 $2,869,337
Oper Inc (Loss)$(192,378)$(171,127)$(214,173)$3,182 $(111,346)
Inc Before Depr $421,184 $474,161 $443,607 $662,268 $553,852
$(500,000)
$–
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
Sewer Operations Fund
Year Ended December 31,
The Sewer Operations Fund ended 2023 with a total net position of $18,950,803, an increase of $273,493
from the prior year. Of this, $15,442,979 represents the net investment in sewer collection system capital
assets, leaving an unrestricted net position of $3,507,824.
Operating revenue in the Sewer Operations Fund increased by $150,397 (5.8 percent) from the prior year,
due to an increase in sewer rates.
Operating expenses for 2023 were $264,925 (10.2 percent) higher than the previous year, mainly in
professional services ($257,425 increase), primarily in municipal wastewater charges.
The Sewer Operations Fund also received $629,637 of infrastructure contributions from street
improvement projects in 2023.
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SOLID WASTE FUND
The following graph presents five years of comparative operating results for the City’s Solid Waste Fund:
2019 2020 2021 2022 2023
Oper Rev $2,244,569 $2,692,155 $2,854,452 $21,746 $9,105
Oper Exp $1,941,102 $2,630,874 $2,566,976 $686,094 $76,270
Oper Inc (Loss)$303,467 $61,281 $287,476 $(664,348)$(67,165)
Inc Before Depr $379,383 $162,475 $365,076 $(664,348)$(67,165)
$(1,000,000)
$(500,000)
$–
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
Solid Waste Fund
Year Ended December 31,
The Solid Waste Fund ended 2023 with a total net position of $1,465,089, a decrease of $407,578 from
the prior year. The entire amount of net position is unrestricted, as the Solid Waste Fund sold off or
transferred its capital assets in 2022.
Operating revenue in the Solid Waste Fund decreased $12,641 (58.1 percent) from the prior year. The
majority of the City’s solid waste operations were outsourced to a private contractor after 2021, other than
one customer the City was contractually obligated to continue to serve into the current year.
Operating expenses for 2023 were $609,824 (88.9 percent) less than the previous year. The current year
expenses of $76,270 were mainly for contractual services and supplies.
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STORM WATER FUND
The following graph presents five years of comparative operating results for the City’s Storm Water
Fund:
2019 2020 2021 2022 2023
Oper Rev $1,130,563 $1,149,665 $1,158,564 $1,227,091 $1,327,520
Oper Exp $553,584 $530,438 $581,402 $719,225 $676,123
Oper Inc (Loss)$576,979 $619,227 $577,162 $507,866 $651,397
Inc Before Depr $1,014,979 $1,059,648 $1,028,358 $970,804 $1,122,531
$–
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
Storm Water Fund
Year Ended December 31,
The Storm Water Fund ended 2023 with a total net position of $15,912,822, an increase of $1,157,016
from the prior year. Of this, $12,680,045 represents the net investment in storm water operation capital
assets, leaving an unrestricted net position of $3,232,777.
Operating revenue in the Storm Water Fund increased $100,429 (8.2 percent) from the prior year, mainly
due to an increase in rates.
Operating expenses for 2023 were $43,102 (6.0 percent) lower than the previous year, mainly due to
decreases in spending for materials and supplies.
The Storm Water Fund also received $868,749 of infrastructure contributions from street improvement
projects in 2023.
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WATER FUND
The following graph presents five years of comparative operating results for the City’s Water Fund:
2019 2020 2021 2022 2023
Oper Rev $2,281,793 $2,533,753 $2,908,352 $2,238,210 $2,496,686
Oper Exp $1,393,568 $1,604,792 $1,746,446 $1,799,190 $1,874,876
Oper Inc (Loss)$888,225 $928,961 $1,161,906 $439,020 $621,810
Inc Before Depr $1,725,319 $1,920,612 $2,152,855 $1,432,301 $1,625,027
$–
$400,000
$800,000
$1,200,000
$1,600,000
$2,000,000
$2,400,000
$2,800,000
$3,200,000
Water Fund
Year Ended December 31,
The Water Fund ended 2023 with a total net position of $33,142,079, an increase of $1,746,337 from the
prior year. Of this, $20,163,140 represents the net investment in water distribution system capital assets,
$2,461,488 is restricted for a future drinking water treatment plant, and unrestricted net position is
$10,517,451.
Operating revenue in the Water Fund for 2023 increased $258,476 (11.5 percent) from the prior year, as
rates charges for water services increased in 2023.
Water Fund operating expenses for 2023 were $75,686 (4.2 percent) higher than the previous year, mainly
due to an increase in maintenance and repair costs.
The Water Fund also received $785,977 of infrastructure contributions from street improvement projects
in 2023.
Page 330 of 352
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STREET LIGHT FUND
The following graph presents five years of comparative operating results for the City’s Street Light Fund:
2019 2020 2021 2022 2023
Oper Rev $226,971 $232,990 $230,479 $233,899 $237,519
Oper Exp $165,886 $173,604 $180,528 $210,174 $214,757
Oper Inc (Loss)$61,085 $59,386 $49,951 $23,725 $22,762
$–
$50,000
$100,000
$150,000
$200,000
$250,000
Street Light Fund
Year Ended December 31,
Street Light Fund operating revenue for 2023 increased $3,620 (1.5 percent) from the prior year.
Operating expenses were $4,583 (2.2 percent) higher than the previous year, mainly in utilities and other
service costs.
Unrestricted net position increased $39,778 in 2023, ending the year at $383,773.
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GOVERNMENT-WIDE FINANCIAL STATEMENTS
In addition to fund-based information, the current reporting model for governmental entities also requires
the inclusion of two government-wide financial statements designed to present a clear picture of the City
as a single, unified entity. These government-wide financial statements provide information on the total
cost of delivering services, including capital assets and long-term liabilities.
STATEMENT OF NET POSITION
The Statement of Net Position essentially tells you what the City owns and owes at a given point in time,
the last day of the fiscal year. Theoretically, net position represents the resources the City has leftover to
use for providing services after its debts are settled. However, those resources are not always in spendable
form, or there may be restrictions on how some of those resources can be used. Therefore, net position is
divided into three components: net investment in capital assets, restricted, and unrestricted.
The following table presents the components of the City’s net position as of December 31, 2023 and
2022, for governmental activities and business-type activities:
2023 2022 Change
Net position
Governmental activities
Net investment in capital assets 39,137,210$ 37,033,206$ 2,104,004$
Restricted 9,132,767 10,556,611 (1,423,844)
Unrestricted 16,705,704 14,198,632 2,507,072
Total governmental activities 64,975,681 61,788,449 3,187,232
Business-type activities
Net investment in capital assets 48,486,110 48,353,192 132,918
Restricted 2,461,488 2,461,488 –
Unrestricted 21,351,782 18,266,640 3,085,142
Total business-type activities 72,299,380 69,081,320 3,218,060
Total net position 137,275,061$ 130,869,769$ 6,405,292$
As of December 31,
The City’s total net position on December 31, 2023, was $6,405,292 higher than the previous year-end.
The City’s net position increased $3,187,232 and $3,218,060 from current year governmental activities
and business-type activities, respectively.
The governmental activities net investment in capital assets increased $2,104,004, mainly due to street
reconstruction financed with municipal state aid construction funds and other internal resources.
Restricted net position decreased $1,423,844, with decreases in net position restricted for debt service and
state-funded street projects, partially offset by an increase in net position restricted for public safety
programs. The increase in governmental activities unrestricted net position of $2,507,072 reflects positive
operating results in the City’s governmental funds, along with the transfer of resources previously
restricted for debt service on fully retired debt issues to the Closed Bond Debt Service Fund, which are
now reported in unrestricted net position.
Changes to the net position of the business-type activities are as detailed in the previous discussion of the
City’s enterprise fund operations.
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-20-
STATEMENT OF ACTIVITIES
The Statement of Activities tracks the City’s yearly revenues and expenses, as well as any other
transactions that increase or reduce total net position. These amounts represent the full cost of providing
services. The Statement of Activities provides a more comprehensive measure than just the amount of
cash that changed hands, as reflected in the fund-based financial statements. This statement includes the
cost of supplies used, depreciation of long-lived capital assets, and other accrual-based expenses.
The following table presents the change in the net position of the City for the years ended December 31,
2023, and 2022:
2022
Program
Expenses Revenues Net Change Net Change
Net (expense) revenue
Governmental activities
General government 5,200,453$ 1,092,271$ (4,108,182)$ (2,587,521)$
Public safety 8,712,115 2,186,491 (6,525,624) (6,648,381)
Public works 3,806,386 2,210,628 (1,595,758) (3,073,288)
Parks and recreation 2,583,554 829,953 (1,753,601) (1,604,280)
Economic development 177,927 32,904 (145,023) (164,678)
Interest and fiscal charges 239,992 – (239,992) (288,751)
Business-type activities
Liquor operations 6,256,081 6,770,085 514,004 416,657
Sewer operations 2,872,236 2,762,566 (109,670) 4,914
Solid waste 76,270 14,693 (61,577) (37,314)
Storm water 725,039 1,327,620 602,581 507,866
Water 1,889,215 2,805,763 916,548 724,655
Street light 214,757 238,805 24,048 25,943
Total net (expense) revenue 32,754,025$ 20,271,779$ (12,482,246) (12,724,178)
General revenues
Property taxes 15,284,709 14,463,106
Franchise taxes 201,431 227,017
Unrestricted grants 944,364 207,501
Investment earnings (charges)2,320,666 (1,400,011)
Gain on disposal of capital assets 136,368 81,008
Total general revenues 18,887,538 13,578,621
Change in net position 6,405,292$ 854,443$
2023
One of the goals of this statement is to provide a side-by-side comparison to illustrate the difference in the
way the City’s governmental and business-type operations are financed. The table clearly illustrates the
dependence of the City’s governmental operations on general revenues, such as property taxes and
unrestricted grants. It also shows that, for the most part, the City’s business-type activities are generating
sufficient program revenues (service charges and program-specific grants) to cover expenses.
The change in net general government activity is mainly due to increased spending related to unrestricted
federal grants. The change in net public works activity is primarily due a greater proportion of the street
maintenance costs being capitalized in the current year. The change in investment earnings (charges) is
due to improved interest rates and market conditions in 2023, especially the fair value fluctuation of the
City’s investment portfolio year-to-year.
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ACCOUNTING AND AUDITING UPDATES
The following is a summary of Governmental Accounting Standards Board (GASB) standards expected
to be implemented in the next few years.
GASB STATEMENT NO. 100, ACCOUNTING CHANGES AND ERROR CORRECTIONS – AN AMENDMENT OF
GASB STATEMENT NO. 62
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.
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 will result in more consistent, decision useful,
understandable, and comprehensive information for users about accounting changes and error corrections.
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.
GASB STATEMENT NO. 101, COMPENSATED ABSENCES
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 a lready
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.
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 included 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 amou nt that normally would be liquidated
with expendable available financial resources.
The requirements of this statement are effective for fiscal years beginning after December 15, 2023, and
all reporting periods thereafter. Earlier application is encouraged.
Page 335 of 352
-22-
GASB STATEMENT NO. 102, CERTAIN RISK DISCLOSURES
The objective of this statement is to provide users of government financial statements with essential
information about risks related to a government’s vulnerabilities due to certain concentrations or
constraints.
This statement defines a concentration as a lack of diversity related to an aspect of a significant inflow of
resources or outflow of resources. A constraint is a limitation imposed on a government by an external
party or by formal action of the government’s highest level of decision-making authority. Concentrations
and constraints may limit a government’s ability to acquire resources or control spending.
A government will be required to assess whether a concentration or constraint m akes the primary
government reporting unit or other reporting units that report a liability for revenue debt vulnerable to the
risk of a substantial impact. Additionally, a government must assess whether an event or events associated
with a concentration or constraint that could cause the substantial impact have occurred, have begun to
occur, or are more likely than not to begin to occur within 12 months of the date the financial statements
are issued.
If a government determines that those criteria for disclosure have been met for a concentration or
constraint, it should disclose information (as outlined in the standard) in the notes to financial statements
in sufficient detail to enable users of financial statements to understand the nature of the circumst ances
disclosed and the government’s vulnerability to the risk of a substantial impact.
The requirements of this statement are effective for fiscal years beginning after June 15, 2024, and all
reporting periods thereafter. Earlier application is encouraged.
Page 336 of 352
CITY OF FARMINGTON
DAKOTA COUNTY, MINNESOTA
Special Purpose Audit Reports
Year Ended
December 31, 2023
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Page
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 1–2
Independent Auditor’s Report on Minnesota Legal Compliance 3
Schedule of Findings and Responses 4
Table of Contents
CITY OF FARMINGTON
DAKOTA COUNTY, MINNESOTA
Special Purpose Audit Reports
Year Ended December 31, 2023
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-1-
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
To the City Council and Management
City of Farmington, 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, t he financial statements of the governmental
activities, the business-type activities, each major fund, and the aggregate remaining fund information of
the City of Farmington, Minnesota (the City) as of and for the year ended December 31, 2023, and the
related notes to the financial statements, which collectively comprise the City’s basic financial statements,
and have issued our report thereon dated June 20, 2024.
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 City’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. However, material weaknesses
or significant deficiencies may exist that were not identified.
(continued)
C E R T I F I E D
A C C O U N T A N T S
P UBLIC
PRINCIPALS
Thomas A. Karnowski, CPA
Paul A. Radosevich, CPA
William J. Lauer, CPA
James H. Eichten, CPA
Aaron J. Nielsen, CPA
Victoria L. Holinka, CPA/CMA
Jaclyn M. Huegel, CPA
Kalen T. Karnowski, CPA
Malloy, Montague, Karnowski, Radosevich & Co., P.A.
5353 Wayzata Boulevard • Suite 410 • Minneapolis, MN 55416 • Phone: 952-545-0424 • Fax: 952-545-0569 • www.mmkr.com
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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
financial statements. 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.
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 report is not suitable for any other purpose.
Minneapolis, Minnesota
June 20, 2024
Page 342 of 352
-3-
INDEPENDENT AUDITOR’S REPORT
ON MINNESOTA LEGAL COMPLIANCE
To the City Council and Management
City of Farmington, 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, t he financial statements of the governmental
activities, the business-type activities, each major fund, and the aggregate remaining fund information of
the City of Farmington, Minnesota (the City) as of and for the year ended December 31, 2023, and the
related notes to the financial statements, which collectively comprise the City’s basic financial statements,
and have issued our report thereon dated June 20, 2024.
MINNESOTA LEGAL COMPLIANCE
In connection with our audit, we noted that the City failed to comply with provisions of the contracting –
bid laws section of the Minnesota Legal Compliance Audit Guide for Cities, promulgated by the State
Auditor pursuant to Minnesota Statutes § 6.65, insofar as they relate to accounting matters as described in
the Schedule of Findings and Responses as finding 2023-001. Also, 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
depositories of public funds and public 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, insofar as they relate to accounting matters. 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.
CITY’S RESPONSE TO FINDING
Government Auditing Standards requires the auditor to perform limited procedures on the City’s response
to the legal compliance finding identified in our audit and described in the accompanying Schedule of
Findings and Responses. 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.
PURPOSE OF THIS REPORT
The purpose of this report is solely to describe the scope of our testing of compliance and the results of
that testing, and not to provide an opinion on compliance. Accordingly, this report is not suitable for any
other purpose.
Minneapolis, Minnesota
June 20, 2024
C E R T I F I E D
A C C O U N T A N T S
P UBLIC
PRINCIPALS
Thomas A. Karnowski, CPA
Paul A. Radosevich, CPA
William J. Lauer, CPA
James H. Eichten, CPA
Aaron J. Nielsen, CPA
Victoria L. Holinka, CPA/CMA
Jaclyn M. Huegel, CPA
Kalen T. Karnowski, CPA
Malloy, Montague, Karnowski, Radosevich & Co., P.A.
5353 Wayzata Boulevard • Suite 410 • Minneapolis, MN 55416 • Phone: 952-545-0424 • Fax: 952-545-0569 • www.mmkr.com
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CITY OF FARMINGTON
Schedule of Findings and Responses
Year Ended December 31, 2023
-4-
MINNESOTA LEGAL COMPLIANCE FINDING
2023-001 CONTRACTING AND BIDDING
Criteria – Minnesota Statutes § 471.345 requires contracts estimated to exceed $175,000 be
let on sealed bids solicited by public notice, and to award the contract to the lowest
responsible bidder. Minnesota Statutes § 574.26 requires contractors doing work on contracts
exceeding $175,000 to provide both performance and payment bonds in an amount not less
the contract price.
Condition – One contract awarded by the City of Farmington, Minnesota (the City) in 2023,
for a project that exceeded $175,000 and included labor, was not let on sealed bids solicited
by public notice, and the contractor did not provide performance or payment bonds.
Questioned Costs – Not applicable.
Context – One out of one bid tested was not in compliance.
Repeat Finding – This is a current year finding.
Cause – The City used a vendor for the project that they mistakenly believed was approved
for use through the state of Minnesota’s cooperative purchasing venture, which would have
been an allowable alternative to using a sealed bid process under Minnesota Statutes
§ 471.345, Subd. 15. The vendor used by the City was in the process of seeking approved
status through the state cooperative purchasing venture, but has not yet been approved. The
lack of performance and payment bonds was due to an oversite by city staff.
Effect – The contract awarded by the City was not let on sealed bids solicited by public
notice as required by Minnesota Statutes, and the statutorily required performance and
payment bonds for contracts of this size that include labor were not obtained from the vendor.
Recommendation – We recommend the City review its procedures for awarding and
administering contracts for goods and services to ensure compliance with applicable
Minnesota Statutes in the future.
Management Response – There is no disagreement with the audit finding. The City will
review its procedures relating to contracting and bidding to ensure compliance in the future.
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REPORT ON COMPLIANCE FOR THE U.S. DEPARTMENT
OF THE TREASURY CORONAVIRUS STATE AND LOCAL FISCAL
RECOVERY FUNDS (CSLFRF) PROGRAM REQUIREMENTS FOR AN
ALTERNATIVE CSLFRF COMPLIANCE EXAMINATION ENGAGEMENT
INDEPENDENT ACCOUNTANT’S REPORT
To the City Council and Management
City of Farmington, Minnesota
We have examined the City of Farmington, Minnesota’s (the City) compliance with the compliance
requirements “activities allowed or unallowed” and “allowable cost/cost principles” (the specified
requirements) as described in Part IV “Requirements for an Alternative Compliance Examination
Engagement for Recipients That Would Otherwise be Required to Undergo a Single Audit or
Program-Specific Audit as a Result of Receiving Coronavirus State and Local Fiscal Recovery Funds” of
the CSLFRF Section of the 2023 Office of Management and Budget Compliance Supplement (referred to
herein as “Requirements for an Alternative CSLFRF Compliance Examination Engagement”) during the
year ended December 31, 2023. Management of the City is responsible for the City’s compliance with the
specified requirements. Our responsibility is to express an opinion on the City’s compliance with the
specified requirements based on our examination.
Our examination was conducted in accordance with attestation standards established by the American
Institute of Certified Public Accountants; the standards applicable to attestation engagements contained in
Government Auditing Standards, issued by the Comptroller General of the United States; and in the
“Requirements for an Alternative CSLFRF Compliance Examination Engagement.” Those standards and
requirements require that we plan and perform the examination to obtain reasonable assurance about
whether the City complied, in all material respects, with the specified requirements referenced above. An
examination involves performing procedures to obtain evidence about whether the City complied with the
specified requirements. The nature, timing, and extent of the procedures selected depend on our judgment,
including an assessment of the risks of material noncompliance, whether due to fraud or error. We believe
that the evidence we obtained is sufficient and appropriate to provide a reasonable basis for our opinion.
We are required to be independent and meet our other ethical responsibilities in accordance with relevant
ethical requirements relating to the engagement.
Our examination does not provide a legal determination on the City’s compliance with the specified
requirements.
In our opinion, the City complied, in all material respects, with the specified requirements referenced above
during the year ended December 31, 2023.
(continued)
C E R T I F I E D
A C C O U N T A N T S
P UBLIC
PRINCIPALS
Thomas A. Karnowski, CPA
Paul A. Radosevich, CPA
William J. Lauer, CPA
James H. Eichten, CPA
Aaron J. Nielsen, CPA
Victoria L. Holinka, CPA/CMA
Jaclyn M. Huegel, CPA
Kalen T. Karnowski, CPA
Malloy, Montague, Karnowski, Radosevich & Co., P.A.
5353 Wayzata Boulevard • Suite 410 • Minneapolis, MN 55416 • Phone: 952-545-0424 • Fax: 952-545-0569 • www.mmkr.com
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OTHER REPORTING REQUIRED BY GOVERNMENT AUDITING STANDARDS
In accordance with Government Auditing Standards, we are required to report all deficiencies that are
considered to be significant deficiencies or material weaknesses in internal control; fraud, and
noncompliance with provisions of laws, regulations, contracts, or grant agreements that have a material
effect on the City’s compliance with the specified requirements; and any other instances that warrant the
attention of those charged with governance. We are also required to obtain and report the views of
responsible officials concerning the findings, conclusions, and recommendations, as well as any planned
corrective actions. We performed our examination to express an opinion on the City’s compliance with the
specified requirements and not for the purpose of expressing an opinion on the internal control over the
specified requirements or on compliance and other matters; accordingly, we express no such opinions. Our
examination disclosed one finding that is required to be reported under Government Auditing Standards
and that finding, along with the views of responsible officials, are described in the attached Schedule of
Findings and Responses.
PURPOSE OF THIS REPORT
The purpose of this examination report is solely to express an opinion on whether the City complied, in all
material respects, with the specified requirements referenced above and on the previous page during the
year ended December 31, 2023. Accordingly, this report is not suitable for any other purpose.
Minneapolis, Minnesota
June 20, 2024
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CITY OF FARMINGTON
Alternative Compliance Examination Engagement
Schedule of Findings and Responses
Year Ended December 31, 2023
FINDINGS REQUIRED TO BE REPORTED UNDER GOVERNMENT AUDITING STANDARDS
2023-001 Noncompliance With State Contracting and Bidding Requirements
Condition – One contract awarded by the City of Farmington, Minnesota (the City) in 2023,
for a project financed with Coronavirus State and Local Fiscal Recovery Funds (CSLFRF)
that exceeded $175,000 and included labor, was not let on sealed bids solicited by public
notice and no performance or payment bonds were obtained from the contractor, as required
by Minnesota Statutes.
Criteria – Minnesota Statutes § 471.345 requires contracts estimated to exceed $175,000 be
let on sealed bids solicited by public notice, and the contract to be awarded to the lowest
responsible bidder. Minnesota Statutes § 574.26 requires contractors participating in contracts
exceeding $175,000 that include labor to provide both performance and payment bonds in an
amount not less than the contract price.
Cause – The City used a vendor for this project that they mistakenly believed was approved
for use through the state of Minnesota’s cooperative purchasing venture, which would have
been an allowable alternative to using a sealed bid process under Minnesota Statutes
§ 471.345, Subd. 15. The vendor used by the City was in the process of seeking approved
status through the state cooperative purchasing venture, but was not yet approved at the time
the contract was awarded. The lack of performance and payment bonds was due to an
oversite by city staff.
Effect or Potential Effect – The contract awarded by the City was not awarded in
compliance with Minnesota statutory requirements, and the statutorily required performance
and payment bonds, which would have provided additional protections to the City, were not
obtained from the contractor.
Recommendation – We recommend the City review its procedures for awarding and
administering contracts for goods and services to ensure compliance with applicable
Minnesota Statutes in the future.
Views of Responsible Officials – There is no disagreement with the audit finding. The City
will review its procedures relating to contracting and bidding to ensure compliance in the
future.
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