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• EN HILLS MEMORANDUM DATE: November 15, 2010 TO: Honorable Mayor and City Council Members Patrick Klaers, City Administrator FROM: Sue Iverson, Finance Director/Treasurer Kyle Howard, Finance Intern SUBJECT: Long-Range Financial Plan Background The City Council had a goal/directive for the finance department to prepare a long-range financial forecasting model. Preliminary work had been done in 2006 with Ehlers Inc which resulted in the model that currently is included in the 2009 and 2010 budget books. It was requested that the model be more interactive to be used for strategic planning (part of the goals and objectives written into the Finance Director's performance evaluation for 2010). Forecasts can be used to create a context for evaluating the annual budget, establishing a baseline for measuring the long-term effects of decisions, to test the economic effects of best-case and worst-case scenarios, and to establish a baseline projection of revenues, expenditures, and future cash flows and fund balances. The long-range financial model should help both staff and council evaluate the financial effects of proposed initiatives and to help educate constituents about an organization's present and potential financial capabilities. It should include well-designed charts and tables that can be used as visual aids in public presentations which can help elected officials, citizens, and other stakeholders gain a better understanding of financial issues. Current Discussion Finance staff had been researching and working on a model as time has permitted. During this research, staff found a model produced by MuniCast that is done entirely in Excel and has the features and capabilities requested which includes programming, customization, and is entirely turned over to us when completed. • City Council Meeting \\Metro-inet\ardenhills\Admin\Council\Agendas&Packet Information\2010\11-15-10 Worksession\Packet Information\2A Long-Range Financial Plan.doc Page 1 of 2