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<br />CITY OF ARDEN HILLS, MINNESOTA
<br />NOTES TO FINANCIAL STATEMENTS
<br />DECEMBER 31, 1999
<br />
<br />Note 3: DETAILED NOTES ON ACCOUNTS - CONTINUED
<br />
<br />Minnesota Statutes require that all City deposits be protected by insurance, surety bond or collateral. The market
<br />value of collateral pledged must equal 110% of the deposits not covered by insurance or bonds (140% in the case
<br />of mortgage notes pledged),
<br />
<br />Authorized collateral includes the legal investments described below, as well as certain first mortgage notes, and
<br />certain other State or local government obligations, Minnesota Statutes require that securities pledged as
<br />collateral be held in safekeeping by the City or in a financial institution other than that furnishing the collateral.
<br />
<br />Investments
<br />
<br />investments are categorized into these three categories of credit risk:
<br />
<br />I.
<br />2,
<br />
<br />Insured or registered, or securities held by the City or its agent in the City's name.
<br />
<br />
<br />Uninsured and unregistered, with securities held by the counterparty's trust department or agent in the
<br />
<br />City's name,
<br />
<br />3,
<br />
<br />Uninsured and unregistered, with securities held by the counterparty, or by its trust department or agent but
<br />not in the City's name,
<br />
<br />At year end, the City's investment balances were as follows:
<br />
<br /> Category Carrying and
<br /> I 2 3 Fair Value
<br />U,S, Government Securities $ 6,570,210 $ - $ $ 6,570,210
<br />Certificates of Deposit 1.068,000 1.068,000
<br /> $ 7638210 7,638,210
<br />
<br />investments not subjected to categorization:
<br />
<br />Broker money markets
<br />4M Fund
<br />
<br />89,928
<br />6.462,8]4
<br />
<br />$ 14,190,952
<br />
<br />Total investments
<br />
<br />A reconciliation of cash and temporary investments as shown on the Combined Balance Sheet for the City
<br />follows:
<br />
<br />Investments
<br />Petty cash
<br />
<br />$ 14,]90,952
<br />325
<br />
<br />Total cash and temporary investments
<br />
<br />$ 14,191277
<br />
<br />B,
<br />
<br />Loans Receivable
<br />
<br />In 1997, the City entered into an agreement with Cardiac Pacemakers, Inc, and the Minnesota Department of
<br />Trade and Economic Development (MNDTED), The agreement with the MNDTED is for a $300,000 Minnesota
<br />investment Fund Grant that will provide funds for a forgivable loan to Cardiac Pacemakers, Inc. The loan is
<br />deferred over five years through August 12, 2001 at interest of3%, If Cardiac Pacemakers, Inc, meets certain
<br />employment criteria, the loan will be forgiven. The balance outstanding at year end is $150,000, In 1998, the
<br />City entered into another agreement with Cardiac Pacemaker, Inc, and the MNDTED, This agreement provides a
<br />$300,000 loan to Cardiac pacemaker, inc, That has a $200,000 forgivable component and a $100,000 loan
<br />component at 3% payable over 60 months. The forgivable component remains forgivable if Cardiac Pacemakers,
<br />Inc, meets certain employment criteria over a five year period beginning September 1998 through August 2003,
<br />The outstanding balance at year end for the forgivable component is $200,000 and for the loan component is
<br />$74,781.
<br />
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