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