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Home My WebLink AboutVIII-06 Approve Financial Statements - 3rd Quarter 2025City Council Memorandum To:Mayor Fasbender & City Council Members From:Chris Eitemiller,Finance Manager and Ashley DeBernardi, Assistant Finance Manager Date:November 3, 2025 Item:2025 3rd Quarter Financial Report Council Action Requested:Review and approve the attached third quarter financial report. Background Information:The third quarter financial report is a quarterly update of 2025 activity through September 30, 2025. Consistent with past practice, some numbers in the report are adjusted to take into consideration the effects of year-end accruals and year-to-year allocation differences. Detail of the City’s investments holdings is provided in Appendix A. Financial Impact:N/A Advisory Commission Discussion:N/A Council Committee Discussion:N/A Attachments: ▪2025 3rd Quarter Financials ▪Appendix A –2025 Investment Holdings as of September 30,2025 VIII-06 2025 3rd Quarter Financial Update 2 | P a g e 2025 3rd Quarter Financial Update Government Funds General Fund Revenue Summary: •The largest source of revenue is property tax levy. The City received the first half settlement in July.The second half will be paid in two payments; we will receive an advance in December, and the remainder in January 2025. •Parks Forestry is well above budget due to boulevard tree maintenance. This revenue is from property owners’ payments for this service. •Police revenues are above budget due to a homeland security grant and the annual police relief payment which exceeded expectations. •The Public Works-Engineering revenue is low because there is a one-time Engineering charge applied to the annual street project, which doesn’t occur until December. VIII-06 2025 3rd Quarter Financial Update 3 | P a g e General Fund Expense Summary: •Most departments’ spending is at or near trend through 3 quarters. •One exception is Facilities, due to the City Hall renovation project. The project is expected to be completed in November 2025.A budget amendment will be done to properly reflect the budget and expenditures for this project in November. •As with revenues Parks Forestry is above budget due to increase boulevard tree maintenance. VIII-06 2025 3rd Quarter Financial Update 4 | P a g e Parks -Fund 200 •Revenues are showing less than expenditures due to planned fund balance use and carry forward items. •Most expenditures are at trend except for supplies. These are expected to be closer to budget near year-end. VIII-06 2025 3rd Quarter Financial Update 5 | P a g e Aquatic Center –Fund 201 •Revenues are showing less than expenditures due to planned fund balance use and carry forward items. •Expenses for this fund are largely finished for the year in the 3rd quarter. With the second half property tax payment, this fund should show a positive year-end financial position. VIII-06 2025 3rd Quarter Financial Update 6 | P a g e Arena –Fund 202 •Expenses exceed revenues but are within the planned budget. •The reason for this is the Arena upgrade capital project. This project began in 2024 and was funded with bond revenue. The project was completed in 2025. The revenue for these expenses is again bond proceeds, which after closing 2024, are part of the fund’s reserves. VIII-06 2025 3rd Quarter Financial Update 7 | P a g e Fire & Ambulance –Fund 213 •Charges for Services revenue item includes Ambulance revenue, which is running below budget. However, since changing Ambulance billing provider, our revenue has steadily improved. It is expected that this revenue will be slightly short of budget at year-end but will be much closer than in recent years. •The Rural Fire contract is also included in Charges for Services and is at 50% of the annual budget. This will add $373,460 when the second half of the annual billing is collected in December. •The Miscellaneous category is higher, which consists of equipment sales, donations, and insurance recoveries. •Spending is near trend and is expected to be within or close to budget at year-end. VIII-06 2025 3rd Quarter Financial Update 8 | P a g e Enterprise Funds The Enterprise funds consist of our three utility funds and the hydro plant. Water –Fund 600 •Water Revenue is ahead of trend due to planning and design grants received for the Central Water Treatment Plant. •Expenditures are within budget trends, with the exception of capital outlay and services. This is because of the water tower reconditioning project and expenses related to the Central Water Treatment Plant. A budget amendment was completed in October to recognize revenues and expenses for the WTP in this fund. As a result,overall expenditures will be close to the amended budget at year-end. •There is also a transfer at year-end related to the street project that has yet to be completed. VIII-06 2025 3rd Quarter Financial Update 9 | P a g e Sewer –Fund 601 •Sewer Revenue stands at 55% collected as of September 30th. •As is the case with Water, expenditures are below budget trend due to timing of the capital allocation related to the street project. Storm Water –Fund 603 •Expenditures, as with Water & Sewer, are below budget because of capital allocation timing related to the street project. VIII-06 2025 3rd Quarter Financial Update 10 | P a g e Hydro –Fund 620 •The hydro plant’s production has been limited due to mechanical problems. •The plant’s expenditures should stay within budget for the year. City-Wide Debt Service •Debt Service expenditures are as anticipated. The principal payment due date is February 1st; all principal payments were made as of the end of the first quarter. Interest payments are made on February 1st as well as August 1st. VIII-06 2025 3rd Quarter Financial Update 11 | P a g e Transfers 2025 Transfers Quarterly transfers are made for administrative charges, internal funding, and savings needs. Transfers posted for 3rd quarter 2025 were all budgeted transfers or budgeted use of stabilization funds. VIII-06 2025 3rd Quarter Financial Update 12 | P a g e Cash and Investments Balances Cash balances fluctuate throughout the year based on planned spending, receipt of fund revenues and the timing of property tax payments. The cash balance within a fund can be one indicator of the health of the fund. FUND DESCRIPTION September 30, 2024 September 30, 2025 General Fund 6,088,619 6,766,203 Parks 266,115 257,126 Aquatic Center 405,708 457,778 Arena 3,004,056 597,848 Cable TV 101,012 96,195 Cable Access 43,103 46,263 Heritage Preservation 113,127 122,543 Fire & Ambulance 89,031 (268,195) LeDuc Historical Estate Operations 74,863 60,430 Police Reserves 43,410 53,454 DUI Enforcement & Forfeitures 52,692 56,072 Parks Capital Projects 587,091 (46,269) Budget Stabilization Fund 364,064 47,148 HEDRA 827,483 691,474 TIF 3 Guardian Angels (099)40,066 12,031 TIF 4 Downtown Redevelopment (007)(21,288)(21,288) TIF 7 Hudson Sprayers 41,820 104,691 TIF 8 Schoolhouse Square 4,458 3,680 TIF 9 Block 28 Flats On Third (47,056)(133,237) Capital Projects Fund (12,880)(171,723) Debt Redemption 968,738 1,597,025 2022A Cold Storage Building (56,469)(55,051) 2016A GO TIF (quasi refunding) Bonds 175,143 155,247 2014 GO Improvement Bonds 25,679 (258,330) 2015 GO Improvement Bonds 126,536 13,459 2016 GO Improvement Bonds 151,845 57,461 2017 GO Improvement Bonds 74,382 52,067 2018 GO Improvement Bonds (797)(12,138) 2019 GO Improvement Bonds 816,599 783,453 2020 GO Improvement Bonds 435,354 425,852 2021 GO Improvement Bonds 252,941 248,289 2022 GO Improvement Bonds 544,223 591,009 2023 GO Improvement Bonds 176,761 124,032 2024 GO Improvement Bonds 614,983 Water 4,196,089 3,321,007 Wastewater 1,991,175 2,176,417 Storm Water 2,140,243 2,453,580 Hydro Electric 555,687 (14,931) Retiree Health 252,767 133,213 Compensated Absences 399,926 573,469 Vehicle & Equipment Fund 713,461 1,035,907 Insurance Fund 706,112 1,091,329 Escrow -Dev/Eng/TIF-HRA 330,317 390,007 Ruth Doffing Trust Fund-Library 93,501 99,492 C. Simmons Trust 234,228 249,226 C. Simmons Residuary 209 221 VIII-06 2025 3rd Quarter Financial Update 13 | P a g e Investments The City’s total investment portfolio was valued at $26,486,903 as of September 30, 2025. Allocation of the City’s portfolio is as follows. Additional detail is available in Appendix A. VIII-06 2025 3rd Quarter Financial Update 14 | P a g e Appendix A –Investment Holdings Detail of Certificate of Deposits, Asset-Backed Securities, and Municipal Bonds VIII-06 2025 3rd Quarter Financial Update 15 | P a g e Additional Information Further detail of the information presented here may be obtained by contacting the Finance Department. The Finance Manager may be reached for questions at 651-480-2347 or CEitemiller@Hastingsmn.gov. The Assistant Finance Manager may be reached at 651-480-2354 or ADeBernardi@Hastingsmn.gov. VIII-06