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expenditures or a target between ($837,000 to $1,046,000). The below represents the last three years of historic general fund balance and the next two years projected general fund balances based on budgeted data. Please note that the City is projecting a fund balance of $1,036,411 at the end of 2012, which is 50% of 2012 budgeted expenditures. 2008 $1,157,516 2009 $1,231,325 2010 $1,068,411 2011 $1,068,411 2012 $1,036,411 Tax Rate I Tax Capacity The general tax rate has been relatively stable from 2007 to 2009 having city tax rates of 45.74 %, 45.81 %, and 46.25 %, respectively. Given overall market valuations in the City have fallen by roughly 14% (in tax capacity terms) the tax rate rose to 54.35% in 2010 and 58.63% in 2011. Taxable market valuations again fell another 11% (in tax capacity terms) for 2012 so the overall tax rate is projected to rise to 66.69% in 2012. That being said, the tax rate is only one of the two variables one must consider before evaluating the true effect on their respective property taxes —the other is the 2012 tax capacity. Cities in Minnesota levy actual dollar amounts and the tax rate is merely the formula for allocating the share to each parcel. For a graphical representation of historic tax rates see appendix E. Debt Service Fund Bud-got Summary The City currently has four outstanding bond issues- 2005A, 2009A, 20098, 2011A. Outstanding principal obligations for these four bond issues are projected to be $9,325,583 at December 31, 2011. There is no new debt anticipated for 2012 so the City is projected to have $8,779,979 in debt principal balances at the end of 2012. Debt Service Revenue: Each bond issue is supported by a levy (2009B series being the only exception) and an assortment of special assessments. The Debt service fund levy and special assessment revenue for 2012 is budgeted at $529,000 and $265,600, respectively. Debt Service Expenditures: Debt Service expenditures include principal and interest payments on the respective bond issues along with fiscal agent fees associated with their annual maintenance. The Debt service principal /interest payments and fiscal agent fees are budgeted at $851,OOO for 2012. 37