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CITY OF CENTERVILLE, MINNESOTA <br />NOTES TO THE FINANCIAL STATEMENTS <br />DECEMBER 31, 2014 <br /> <br />Note 6: OTHER INFORMATION <br /> <br /> <br />A.Risk management <br /> <br />The City is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and <br />omissions; injuries to employees; and natural disasters for which the City carries insurance. The City obtains insurance <br />through participation in the League of Minnesota Cities Insurance Trust (LMCIT), which is a risk sharing pool with <br />approximately 800 other governmental units. The City pays an annual premium to LMCIT for its workers compensation <br />and property and casualty insurance. The LMCIT is self-sustaining through member premiums and will reinsure for <br />claims above a prescribed dollar amount for each insurance event. Settled claims have not exceeded the City’s coverage <br />in any of the past three fiscal years. <br /> <br />Liabilities are reported when it is probable that a loss has occurred and the amount of the loss can be reasonably <br />estimated. Liabilities, if any, include an amount for claims that have been incurred but not reported (IBNRs). The City’s <br />management is not aware of any incurred but not reported claims. <br /> <br /> <br />B.Legal debt margin <br /> <br />In accordance with Minnesota statutes, the City may not incur or be subject to net debt in excess of 3 percent of the <br />market value of taxable property within the City. Net debt is payable solely from ad valorem taxes and, therefore, <br />excludes debt financed partially or entirely by special assessments, Enterprise fund revenues or tax increments. The <br />market value of taxable property is $285,605,600 which leaves a debt margin of $8,568,168. Currently the City has <br />$395,000 of general obligation debt outstanding, leaving a debt margin of $8,173,168. <br /> <br /> <br />C.Subsequent event <br /> <br />On January 15, 2015, the City issued $1,385,000 General Obligation Improvement Refunding Bonds, Series 2015A. The <br />refunding bonds will mature on February 1, 2025 and carries an average coupon rate of 1.81 percent. The issue will <br />refund the General Obligation Improvement Crossover Refunding Bond, Series 2009B. <br /> <br /> <br /> <br /> <br /> <br />-64- <br /> <br /> <br />