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Home My WebLink About2012 06-19 CCPCity of Gem Lake, MN City Council Meeting June 19, 2012 Call To Order of City Council Meeting — By Mayor Uzpen at 7:_P.M. Call of Roll Uzpen Artig-Swomley Lindner Rasmussen Bosak Others in Attendance: Sign-up Sheet Approval of City Council Minutes and Agenda • City Council Agenda for this meeting (Accept Agenda) • Minutes of the City Council Meeting for May • Minutes from the Planning Commission Meeting for May accept approved minutes Committee Reports • Planning Commission Report Old Business • News Letter Ideas Public Hearing • None New Business • Auditors Report - LarsonAllen • VWALMO Presentation — Stephanie McNamara • Comp Plan approval - Motion to approve • Nite to Unite Proclamation • Claims for June • Monthly Financial Reports • Presentations from the public, five minutes maximum presentation • Open Items for the Council Members to bring up. Future Council Meetings • Next Workshop Meeting, July 9 at 7:00 P.M. • Next City Council Meeting, July 17 at 7:00 P.M. Adjournment 0 The meeting adjourned at _ CITY OF GEM LAKE, MN 4200 Otter Lake Road Gem Lake, MN 55110-3227 Telephone 651-747-2790 E-mail City az.gen lakeMN.or� Minutes of Gem Lake City Council Meeting 15 May 2012 The regular meeting of the City Council of the City of Gem Lake was called to order by Mayor Uzpen on Tuesday, May 15, 2012 at 7:02 pm in the Gem Lake City Hall meeting room. The following members were present: Mayor Robert Uzpen, Councilmembers James Lindner, Gretchen Artig-Swomley, Richard Bosak and Thomas Rasmussen. Members of the public attending per the sign in sheet sent around the room. APPROVAL OF AGENDA AND MEETING MINUTES City Council Agenda: Mayor Uzpen called for additions, deletions and corrections to the agenda. Upon motion by Councilmember Bosak, and seconded by Councilmember Artig-Swomley, the May 15, 2012 agenda was approved. Ayes — 5, Nays — 0. Planning Commission April Meeting Minutes: The Planning Commission April minutes were presented and corrections were needed. Upon motion by Councilmember Rasmussen, and seconded by Councilmember Artig-Swomley, the April Planning Commission minutes were accepted. Ayes — 5, Nays — 0. City Council April Meeting Minutes: The April 2012 minutes were presented and corrections were needed. Upon motion by Councilmember Artig-Swomley, and seconded by Councilmember Bosak, the minutes of April 2012 were accepted with corrections being made. Ayes —4, Nays — 0, Abstained - 1. Planning Commission Chair Report: Chairperson Faith Kuny reported to the council that the Planning Commission approved the Chicken Ordinance and forward to the City Council. OLD BUSINESS Newsletter: Councilmember Artig-Swomley stated she would like to do an article on Vera Auto and the LaRoma restaurant. The City Clean -Up day. Councilmember Artig- Swomley received an email from one of the residents regarding a police report from Alabama on some of the things people pick up along the road that people throw out. -Gem Lake City Council Meeting Page 2 of 6 An article on National Night Out. A story on Garlic Mustard that is a plant that covers many yards. Settlers adopted it long ago, as it is a flowering plant with a white flower on it that grows quickly. In addition, a story on Jessie Hart's departure and the story on the chicken coop ordinance. In addition, the Honeymoon House and the Waste Management recycling which Councilmember Artig-Swomley found on their website. In addition, a story on Rachael the recipient of City of Gem Lake's scholarship she received. PUBLIC HEARING ►h= NEW BUSINESS Carlson CUP: Mr. and Mrs. Carlson, residents of the City of Gem Lake want to have a small number of chickens on their property. They came to the City to get a permit and went before the Planning Commission. Planning Commission Chairperson Faith Kuny stated that the Planning Commission felt when the City Council puts together the chicken ordinance; they felt 25 chickens would be the maximum number of chickens to have. In addition, there was some question on the fee for the chickens. The Carlson's are going to have five (5) chickens on their property and the fee would be $50. Commissioner Herzog did some research on twelve (12) other residents who own chickens in Gem Lake. Most people are raising chickens for their personal use. She feels the fee should be $10 like a dog license, with something written to make sure that the chickens are maintained and if the smell is drifting over to the neighbors, there would be a $100 fine. Mayor Uzpen explained what the fees covered and how the surrounding cities have the same fees. The fee covers the cost of having the property inspected and the cost of the permit. Councilmember Lindner read from Ordinance #69, Section 3.8: "... It would be unlawful to keep or harbor in the City, any animals without first obtaining written Conditional Use Permit from the City of Gem Lake..." Councilmember Artig-Swomley stated that there should be wordage regarding having a rooster as when they are babies, it is hard to tell the sex of the chicken. Councilmember Bosak feels before voting on the ordinance, the City Council should do more research. Upon motion by Councilmember Lindner and seconded by Councilmember Artig- Swomley, the Conditional Use Permit for purchasing and keeping chickens has passed. Ayes — 5, Nays — 0. Look for us on the World Wide Web at gemlakemn.org Gem Lake City Council Meeting Page 3 of 6 Claims for May: The claims for May were discussed and authorized to pay. Upon motion by Councilmember Lindner and seconded by Councilmember Bosak, motion passes. Ayes — 5, Nays — 0. Monthly Financial Reports: The City Council received and reviewed the report. City Attorney Update: Status of Garden Overlay Permits for Bryan Hansen: Mayor Uzpen received an email from Pat Kelly regarding the permit for Mr. Hansen. Mayor Uzpen will be meeting with Mr. Hansen in a few weeks when he is back in town. The issue is the cost of the permits. Mayor Uzpen feels the Comp Plan needs to be changed as the land is zoned for Gateway, but the land is being used for agricultural versus residential. City Attorney Trevor Oliver feels the Comp Plan does not need to be changed; the wordage can be changed to farming. Tom Riedesel from White Bear Township wants to get a resolution to the Comp Plan. The City Council will need to approve the current Comp Plan at the June City Council meeting to bring it current and then make any changes. Status of Updating the Cities Watershed Ordinance: Attorney Oliver has started putting the ordinance into word format. VLAWMO takes care of the watershed for the City of Gem Lake and is responsible fro the run-off drain. Planning Commission Chairperson Faith Kuny will put it on the agenda for the June Planning Commission meeting. Monthly or Yearly Fees to Senior Citizen Developments: Attorney Oliver stated there is nothing specific regarding cities charging a fee. Most Senior Citizen facilities are non-profit. It depends on who owns the facility. For the most part, there is an exception of property tax for non-profit facility. Most cities will work out the service charge for the services: street maintenance, police, water and utilities to name a few. There will be a tax based on housing. PRESENTATIONS FROM THE PUBLIC None OPEN ITEMS FROM THE CITY COUNCIL Mayor Uzpen has reviewed the Gateway Ordinance, especially by the matrix, wants to know what is forbidden? There is nothing in the ordinance that states that a hockey rink or hotel that requires a Conditional Use Permit. Attorney Oliver explained that if it is not on the matrix, then it is not allowed. There are four (4) categories, but the ordinance can be amended. The developer should be told of the above issues. Matrix issues state they cannot be open past 10 to 11 p.m. Mayor Uzpen requested that Attorney Oliver work on this and notify the developers regarding the commercial issues. Look for us on the World Wide Web at gemlakemn.org Gem Lake City Council Meeting Page 4 of 6 Planning Commission Chairperson Faith Kuny had talked to Tom Riedesel regarding zoning and it can be built under commercial east of Highway 61 in the business district. Anything built on open properties will be on the residential property and will have to be amended. Mayor Uzpen stated that commercial building on Hoffman Corners, but anything west of Tousley Ford is a different issue. Mayor Uzpen mentioned Gem Lake Lodge and asked Trevor if the City Council should amend this. City Attorney Oliver mentioned that Gem Lake might need to offer a helping hand and a conversation needs to take place regarding this development between Gem Lake and the developer. A Public Hearing would need to take place regarding the hotel. Councilmember Rasmussen feels the developer needs to be told the ordinance would need to be amended and see if the interest is still there. Councilmember Artig-Swomley feels that a Public Hearing needs to take place regarding the medical office building next to the Fairfield/Marriott hotel. Councilmember Lindner attended the VLAWMO seminar and there was discussion regarding the Gem Lake being removed from the State compared water list. The City only has to clean up 24% of the sediment being deposited. The City would need to meet with the business owners on Highway 61 by that lake to discuss the issue. Mayor Uzpen updated the City Council on the Tangwell issue. They have until May 1, 2012. They have been given information on the six plants that can be planted per two feet on the shoreline. White Bear Township Inspector Mike Johnson has looked over the property and stated that they will need to plant some more greenery and has requested a list of what plants were planted. FUTURE COUNCIL MEETINGS Workshop Meeting: June 11, 2012 at 7:00 p.m. City Council Meeting: June 19, 2012 at 7:00 p.m. Look for us on the World Wide Web at gemlakemn.org Gem Lake City Council Meeting Page 5 of 6 ADJOURN The May15, 2012 regular meeting of the City Council adjourned at 8:01 p.m. Upon motion by Councilmember Lindner, and seconded by Councilmember Rasmussen, the City Council meeting was adjourned. Ayes — 5, Nays — 0. APPROVED: ATTEST: ATTEST: Julie Newkirk Robert Uzpen Recording Secretary Mayor Look for us on the World Wide Web at gemlakemn.org Gem Lake City Council Meeting Page 6 of 6 SIGN UP SHEET: Diane Carlson Beth & Steve Herzog Amber Peterson Beckie Pierce Karl Helkamp Tim Waldoch Lynette Berdan Leanna McReynolds Nick Johnson Faith Kuny Dani Hronoski Trevor Oliver Look for us on the World Wide Web at gemlakemn.org CITY OF GEM LAKE, MN 4200 Otter Lake Road _ Gem Lake, MN 55110-3227 - Telephone 651-747-2790 E-mail City(a gemlakeMN.org Gem Lake Planning Commission Meeting 1 May 2012 The regular meeting of the Planning Commission of Gem Lake was called to order by Chairperson Faith Kuny on Tuesday, May 1, 2012 at 7:03 p.m. at the Gem Lake City Hall conference room. The following members were present: Chairperson Faith Kuny, and Planning Commissioners Arthur Pratt and Beth Herzog. Commissioners Dan Marier and Derrick Wippich were not in attendance. Planning Commission May Agenda: Chairperson Kuny asked for any changes, deletions, or added agenda items. None was given and upon motion by Commissioner Pratt and seconded by Commissioner Herzog; the May 1, 2012 agenda was approved. Ayes — 3, Nays — 0. April Planning Commission Minutes: The April Planning Commission minutes were reviewed and upon motion by Commissioner Pratt and seconded by Commissioner Herzog, the April Planning Commission minutes were approved. Ayes — 3, Nays — 0. OLD BUSINESS Update Regarding Daniels Farm Road Neighbor Meeting with Developer: Chairperson Faith Kuny updated the Planning Commission regarding the meeting that took place with the developer. Chairperson Kuny kept hearing from the residents that they feel the current Gateway Ordinance is a compromise and when the residents bought their properties and built their homes it was zoned as residential. The developer discussed that they would review and work on their plans to fit the Gateway Ordinance. Chairperson Kuny asked the developer if they had thought about building near highway 61. PUBLIC HEARING Conditional Use Permit for 3 to 5 chickens requested by Diane and Anthony Carlson on the residential property of 1501 Goose Lake Road, Gem Lake, MN: Gem Lake Planning Commission Minutes Page 2 of 4 The Carlson's approached the City of Gem Lake asking if they could raise chickens on their property. Under the fee guidelines of Gem Lake, a Conditional Use Permit is $1,600. There is now a special fee schedule for raising chickens. The fee is one to three chickens; $25 fee with a $15 annual renewal. If you have four or more chickens; $50 fee with a $15 annual fee. The initial fee is because Tom Riedesel from White Bear Township would need to visit the property to see where the chickens will be placed. Public Hearing opened at 7:07 p.m. Mr. Carlson explained that they will be ordering a chicken coop to place behind the garage to keep the chickens inside with the idea of buying four or five chickens that lay eggs for their family. Chairperson discussed the issue when buying chicken, there is a chance that one of the chickens would be a rooster. Mr. Carlson stated that if they got a rooster, it would be dinner. Councilmember Tom Rasmussen discussed that the City Council wants the Ordinance to be re -written and will put something together reviewing what the surrounding communities have done with chickens. Chairperson Kuny stated to Mr. Carlson that a site plan would be needed going with the guidelines of the Conditional Use Permit. Mr. Carlson expressed that where the chickens will be spring through fall no one can see the area due to foliage and trees surrounding the yard. Public Hearing closed at 7:18 p.m. Commissioner Herzog stated that she moved to the City of Gem Lake specifically because you could have small poultry, but knows plenty of people in Gem Lake that are raising chickens. She feels the fees are too high and feels the residents should be able to go up to a dozen chickens with a $10 fee. Some people raise the chickens to eat and that is a two month process. If chickens are ordered through Murray, there is a 25 chicken order minimum. Inspection will be one time, so cost seems to be okay with that, but need to clarify with City Attorney Trevor Oliver. Attorney Oliver did suggest to Chairperson Kuny to view the Pigeons Ordinance. Councilmember Rasmussen stated that all residents of Gem Lake will require going through this process if they are raising chickens and will have to pay a fee. Chairperson Kuny wants to know if an inspection of the chickens will be yearly thing. If so, then that justifies the fees. Look for us on the World Wide Web at gemlakemn.org Gem Lake Planning Commission Minutes Page 3 of 4 Mr. Carlson feels that all residents raising chickens will be grandfathered in and he will be the first tested and wants to just buy the chickens and pay the fee required. Upon motion by Commissioner Herzog and seconded by Commissioner Pratt, the Planning Commission recommends moving this forward to the City Council to approve the Conditional Use Permit and be accepted as stated. Ayes — 3, Nays — 0. NEW BUSINESS Clean Water Goals for Community Meeting on May 3, 2012: City Council member James Lindner explained the issue of shallow lakes having nothing that churns up the water. The water run-off makes it worse. Councilmember Lindner is going to a Clean Water workshop with VLAWMO regarding water issues on Thursday also. The U of M will be involved with that meeting. Commissioner Herzog requested a phone number to call if a truck dumps some waste matter and is in violation. VLAWMO does do reading/studies from the lakes. They have done a great job of restoration on Bush Lake. OPEN ITEMS None FUTURE MEETINGS: Planning Commission Meeting: June 5, 2012 at 7:00 p.m. ADJOURN: Upon motion by Commissioner Herzog and seconded by Commissioner Pratt, the May 1, 2012 regular meeting of the Planning Commission was adjourned at 7:44 p.m. Ayes — 3, Nays — 0. APPROVED: ATTEST: ATTEST: Julie Newkirk Faith Kuny Recording Secretary Chairperson Look for us on the World Wide Web at gemlakemn.org Gem Lake Planning Commission Minutes Page 4 of 4 Sign In Sheet: Tom Rasmussen Anthony Carlson James Lindner Look for us on the World Wide Web at gemlakemn.org CITY OF GEM LACE, RAINISEY COUNTY, �IMINNESOTA ORDINANCE NO. 120 ANORDINANCE REGULATING THE D[SCHARGE OFWEAPONS AND HUNTINGON PROPERTY LOCATED WITHIN THE CITY OF GEM LAKE, M[NNES®TA. THE C'I'T'1' COUNCIL OFTHE CITY OF GEM LAKE ORDAINS: Section 1. 1witenl and purpose. The City Council intends to protect the public safety of its citizens by regulating the use and discharge of certain weapons on real property in the. City of Clem 1_,al;e, as permitted by Minnesota `Statutes, § 471.633. The City Council recognizes that State. law governs all other matters regarding firearms, including purchase, possession, and rights to carry. The COUncil also intends that existing State law relating to the discharge of bows and arrows in Minnesota Statutes, Chapter 9713, and to the purchase, possession, carrying or use of other potentially dangerous weapons under Minnesota Statute,,, § 609.66 and similar laws, be enforced in the City. Section 2. Definitions. As used in this Ordinance, "Dangerous weapon" has the meaning given it in Minnesota Statutes, 609.02, subdivision 6. Section 3. Discharge of `'Weapons Prohibited. Except as specifically authorized in Section -I, the discharge or use of dangerous weapons is hereby prohibited. Violation of any teen oi'tliis Ordinance \ i misdeni anor J 'section 4. Exceptions. Dangerous weapons may be discharged or used in the City only under the following circumstances: 4.1 )hinting as Part of Wildlife Management Plan The City Council may issue permits authorizing the use of discharge of a firearm or bow and arrow within the. City. Such permits shall only be issued to individuals participating in a hunt organized by either Ramsey County or the Minnesota Department of Natural Resources expressly for the management of wildlife populations, Said permit shall be issued only during the appropriate game season, or as otherwise ID authorized by the State of Minnesota, Department of Natural Resources. 4.1 1 A hunting permit granted under this paragraph shall only authorize the discharge or use of firearms or bow and arrow on a specified parcel of property of five (5) acres or larger within the City of Gem Lake A permit shall only be issued when the indWidual or the entity organizing the hunt produces written consent to hunt on the land f-oin th(: property owner on =i forni approved by the City. The City Council may further limit lllintin�i areas within the speci fled parcel of property to protect the public safety and welfare. 4. 1 2 The maximum duration of a hunting permit shall be three weeks. A permit may authorize the discharge and use of weapons a maximum of three days in any single week. J CITY OF GEM LAKE, RAMSEY COUNTY, MINNESOTA ORDINANCI' NO. 114 (Summary) SUMMARY PUI3LICATION. Pursuant to Minnesota Statutes, § 412.191, a summary of an ordinance may be published. While a copy of the entire ordinance is available without cost at the office of the City Clcrk, the lollowing summary is approved by the City Council and shall be published in lieu of'publishing the entire ordinance: Ordinance 114, the Floodplain Ordinance, adopts land use rules and regulations required to comply with the National Flood Insurance Program. The terms of the Ordinance apply to land in Gem Lake which is located within a f� loodway or Flood Fringe area depicted on the Flood Insurance Rate Maps published by the Federal Emergency Management Agency. Neither the maps nor Ordinance 114 warrant or imply that lands outside of these mapped areas will be free from flooding. The Ordinance specifies land -use restrictions in the Floodway and Flood Fringe areas depicted on the FEMA maps. which apply in addition to the primary zoning assigned to the land by the City. The additional uses, conditional uses, and prohibitions generally apply to the flood damage potential of the structure or use. The Ordinance also specifies additional requirements to public utilities, transportation facilities, and private septic and well systems located within flood hazard districts indicated on the FEMA maps. Violation of the terms of Ordinance 114 is a misdemeanor, and the City may employ other civil remedies to correct the violation. Ordinance 114 is effective upon its publication. CITY 01' Gf M LAKF. RAMSFY COUNTY, MINNESOTA ORDINANCE NO. 115 (Sunlnlary) SUMMARY PUBLICATION. Pursuant to Minnesota Statutes, § 412.191, a summary of an ordinance may be published. While a copy of the entire ordinance is available without cost at the office of' the City Clerk, the following summary is approved by the City Council and shall be published I11 hell Of pLlblishlnc the entire ordinance: Ordinance 115 amends the "tobacco Ordinance, No. 68, to increase the administrative lines ibr ordinance violation. Ordinance 1 15 is effective upon its publication. J CITY OF GFM LAK1"„ RAMSITY COUNTY, MINNI SOTA ORDINANCI; NO. 116 (Summary) SUMMARY PUBLICATION. PLII-SLIant to Minnesota Statutes, § 412.191, a summary of an ordinance may be published. While a copy of the entire ordinance is available without cost at the off -ice of the City Clerk, the [ollowin() summary is approved by the City Council and shall be published In 11CLI o[ pLIbllshing the entire ordinance: Ordinance 116 amends the L,ICIL101- Ordinance, No. 9. to establish authority and procedures for the City COLn7CII to impose civil penalties ffir violations of the Liquor Ordinance by license holders. Ordinance 1 16 is effective upon its publication. j —1 CITY Ol- G1,:M LAK1;, RAMSI.:Y COUNTY, MINNI SOTA ORDINANCE NO. 117 (SLtmntary) SUMMARY PUBLICATION. Pursuant to Minnesota Statutes, § 412.191. a summary o1' an ordinance May be published. While a copy of the entire ordinance is available without cost at the office of the City Clerk, the 1611owing summary is approved by the City COLInCII and shall be published In IICLI Of pUblishing the entire ordinance: Ordinance 117 amends the Charitable GaMblino Ordinance, No 60, to increase the required quarterly contribution to the City fi-oM 2% to 10%. The Ordinance also clarifies the COLInCH's authority to disburse funds collected through the quarterly contributions. Ordinance 117 is effective upon its publication. J CITY OF GEM LAKE, RAMSEY COUNTY, MINNESOTA ORDINANCE NO. 113 AN ORDINANCE REGULATING THE HUNTING ON PROPERTY LOCATED WITHIN THE CITY OF GEM LAKE, MINNESOTA. THE CITY COUNCIL OF THE CITY OF GEM LAKE ORDAINS: Hunting with or discharging any firearm, including a rifle, shotgun, air gun, air rifle, pellet gun or BB gun, and bow and arrow is prohibited within the city limits except with a permit issued by the City Council. The City Council may issue permits authorizing temporary deer hunting with bow and arrow. Said permit shall be issued only during the deer season for bow and arrow, or as authorized by the State of Minnesota, Department of Natural Resources and shall only be issued to those who have written consent from the property owner on a form approved by the City. The permit fee shall be set forth by City Council resolution. The City Council may limit hunting areas to protect the public safety and welfare. SEVERABILITY.: Should any section, subdivision, clause or other provision of this Ordinance be held to be invalid in any court of competent jurisdiction, such decision shall not affect the validity of the Ordinance as a whole, or of any part hereof, other than the part held to be invalid. EFFECTIVE DATE. This Ordinance shall take effect and be in force from and after its passage and publication. Dated: .2010 Robert Uzpen — Mayor William Short - Clerk Summary of Ordinance 112 approved by City Council and published in the White Bear Press on . 2010. 603-1 Other activities (such as setting up stands) may take place on the days on which weapons discharge is not permitted. 4 1.3 The permit fee shall be set forth by City Council resolution. 4 1.4 All State and Federal hunting rules and regulations shall apply in addition to requirements imposed by the City Council. 4.2 Target Archery. A person may use a bow and arrow on private property, with permission frorn the owner, for target archery. Arrows used for target archery must have points that are no wider than the shag of the arrow, and not razor-edged on any surface. Archers must shoot at a tart'_>et, and targets must be mounted on material of sufficient depth and density to stop an arrov.; fired ti-om the bow used by the archer- Trees and other live plants are riot considered suitable backing material for mounting targets- The shooting area and the targets must be placed so that there are no buildings, rights -of -way, or public lands within a reasonable distance behind the targets; the "clear" area must be at least 1 /3 of the estimated maximum shot distance for the type of bow used by the archer. 4.3 Defense of Self and Property against Vicious Animals. It is not a violation of this Ordinance to use a firearm or bow and arrow against a vicious animal while acting in sell'=defense_ in defense of another person, or to defend property (including pets and other domestic animals) fi-om harm or damage. This provision is not intended to affect State law regarding the use of force against another person for self-defense, defense of others, or in defense of property 4.4 l,aw Enforcement. This Ordinance shall not apply to licensed peace officers or other authorized personnel engaged in law enforcement activities when using firearms or other weapons in the regular course of performing their duties Section S. Severability. Should any section, subdivision, clause or other provision of this Ordinance be held to be invalid in any court of competent jurisdiction, such decision, shall not affect the validity of the Ordinance as a whole, or of any part hereof, other than the part held to be invalid Section 6. Effective ®rate. This Ordinance shall take effect and be in force from and after its passage and publication Dated: Robert Uzpen L a r ill&n Short - Clerk Summary of Ordinance 120 approved by City Council and published in the White Bear Press on 1)010 `J CITY OF GEM LAKE, RAMSEY COUNTY, MINNESOTA ORDINANCE NO. 122 AN ORDINANCE AMENDING THE ZONING ORDINANCE OF GEM LAKE TO ADD A NEW SECTION ALLOWING FOR A GARDEN OVERLAY ZONE. THE CITY COUNCIL OF THE CITY OF GEM LAKE ORDAINS: SECTION 1. AMENDMENT. A new Section 14 of Ordinance 43K is added, to read as follows: SECTION 14 - GARDEN OVERLAY DISTRICT Section 14.1 Findings and Purpose. 14.1.1 The City Council makes the following findings: A) The land -use plans of the City of Gem Lake historically have not assigned any land in the City for long-term agricultural use, as the City has developed and continues to develop as a primarily residential community surrounded by fully developed suburban neighborhoods. The City Council reaffirms the City's intent to encourage development of the City in accordance with its adopted comprehensive plans. B) At the time this Ordinance is considered, large land parcels in the City have yet to develop any primary use and stand vacant. Additional large -lot property in the City is projected to subdivide and develop into smaller lots over the next 10 to 30 years. The City Council recognizes that economic conditions are not always favorable for real estate development, and that the costs to carry vacant land can create pressures that promote sub- optimal development. Permitting small-scale agriculture as a primary use will allow owners of large undeveloped parcels to qualify for agricultural tax classification, and thus lower tax payments, without affecting the long-term plans for the land. The Council finds that providing this means to temporarily ease this pressure will enhance the City's ability to fully realize the goals of its comprehensive plans. C) Several cities and metropolitan areas are placing a greater emphasis on local food production as a means of improving public health. Allowing the use of available space in the City for "community gardens" or "market gardens" to grow food will promote local food production and improve public health in Gem Lake and the surrounding community. D) As an interim use of land, subject to the regulations proposed, community gardening and market gardening will be compatible with all allowed land uses in the City of Gem Lake, and with the goals of the City's comprehensive plan. 14.1.2 The Council intends that the Garden Overlay District be available to overlay on parcels of land in any existing zoning district to add the uses described in the district regulations to the list of uses allowed upon that land. The Garden Overlay District may be applied to and superimposed as an overlay upon any zoning district, defined in this Zoning Ordinance, as existing or amended by this section and as shown on the official Zoning Map. Nothing in this Section is intended to affect the ability of landowners to maintain accessory uses that are allowed without the Overlay zone upon their property, whether or not the Overlay zone covers their property. This overlay district is intended to permit a temporary land use, and should no longer be needed on a parcel when it eventually develops in accordance with the regulations of the underlying zoning district. Section 14.2 Definitions. Community Garden means an area of land managed and maintained by a group of individuals to grow plants and harvest food crops for personal or group use, consumption or donation. Community gardens may be divided into separate plots for cultivation by one or more individuals or may be farmed collectively by members of the group, and may include common areas maintained and used by group members. Market Garden means an area of land managed and maintained by an individual or group of individuals to grow plants and harvest food crops to be sold for profit. Hoophouse means a structure made of PVC piping or other material covered with translucent plastic, constructed in a half -round or hoop shape. Coldframe means an unheated outdoor structure with a frame of wood or similar material and a top of glass or clear plastic, used for protecting seedlings and plants from the cold. Animal Husbandry means a use in which animals are reared or kept in order to sell, consume or donate the animals or their products, such as meat, fur or eggs. Aquaculture means a use in which food fish, shellfish or other marine foods, aquatic plants or aquatic animals are cultured or grown in a body of water in order to sell, consume or donate theirs or the products they produce. Section 14.3 Requesting Garden Overlay. Applications to create a Garden Overlay District shall be made and considered as a re -zoning request in accordance with Section 17.6 of this Ordinance. In addition to the documents and materials generally required for a re -zoning application, the applicant shall supply copies of draft leases, contracts or use agreements to which the groups or individuals using the gardens will agree prior to using the garden space. Such agreements must provide the land owner or designated representative with the legal ability to evict a tenant and bar entry to any individual member of a group, if the tenant or individual violates the terms of this Ordinance, the terms of the Interim Use Permit for the property, any restrictive term of the lease or agreement, or any other applicable City Ordinance or state law. Section 14.4 Termination of Garden Overlay. A Garden Overlay District shall remain in effect until one of the following occurs: 14.4.1 City approval of a zoning application for a use or uses permitted in the underlying zone (e.g. development plan, conditional use permit, or building permit); the Garden Overlay status and any permits granted under the terms of this Section shall expire six months from the date of 1 approval; or 14.4.2 The Interim Use Permit for the property expires, and no application is made to renew the permit within six months of the expiration; or 14.4.3 The Interim Use Permit for the property is revoked by the City Council for violations of this Ordinance, permit conditions, or any other applicable law or ordinance. Section 14.5 Interim Uses. 14.5.1 Subject to applicable provisions of this Ordinance, the following are considered to be Interim Uses in the Garden Overlay District: A) Corm-nunity Gardens. B) Market Gardens. 14.5.2 Interim Use Permits granted under this Section expire on March 15`h of each year. The permit may be renewed annually, at the discretion of the City Council. Application for and approval of an Interim Use Permit shall follow the procedures set forth in Section 17.5 of this Ordinance. In addition to the requirements of that Section, the applicant shall provide a written summary of the proposed uses of fertilizers, pesticides and other agricultural chemicals in the maintenance of the gardens. In approving an Interim Use Permit, the City Council may attach such additional conditions as it deems necessary to assure compatibility with surrounding land uses, including conditions relating to the use of agricultural chemicals on the property. Section 14.6 Permitted Accessory Uses. Subject to applicable provisions of this Ordinance, the following are allowed accessory uses to any validly issued Interim Use Permit in any Garden Overlay District: 14.6.1 Hoophouses, coldframes and similar structures used to extend the growing season. 14.6.2 Benches, planting beds, compost bins, rain barrels and similar structures used to facilitate the growth of plants. 14.6.3 Off-street parking and loading areas. Section 14.7 Prohibited Practices. 14.7.1 No motorized implements or machinery may be used in the cultivation and maintenance of any garden, except for plowing of the plots between the hours of 8:00 A.M and 5:00 P.M, Monday through Friday. Motor vehicles of less than 7,000 lbs gross vehicle weight may be used to deliver and carry away equipment, supplies and product. 14.7.2 Animal husbandry and aquaculture are not permitted activities within a Garden Overlay zone. J14.7.3 No fuel, fertilizer, pesticides or similar chemicals shall be stored on the property. Section 14.8 General Regulations. 14.8.1 The minimum land area for application of a Garden Overlay shall be ten acres. 14.8.2 All gardening activity and all structures and equipment shall be set back at least 20 feet from the property line of any property not included within a Garden Overlay Zone, and at least 150 feet from any dwelling. 14.8.3 All gardens shall be divided into garden plots, separated from other plots and from required setback areas by unpaved walkways of at least 6 feet in width. No single plot shall cover more than 10% of the total land area of the property on which the plot is located. 14.8.4 Off-street parking and loading areas shall be unpaved and shall not exceed 15% of the lot area covered by garden plots and required walkways. 14.8.5 The property owner is responsible for the collection and disposal of litter on the property. 14.8.6 The hours of operation for a permitted garden are 'A hour before sunrise until '/2 hour after sunset. 14.8.7 The property owner is responsible for ensuring compliance with all other applicable laws, ordinances and regulations, including city ordinances and watershed district rules governing wetlands and stormwater control. SECTION 2. Severability. Should any section, subdivision, clause or other provision of this Ordinance be held to be invalid in any court of competent jurisdiction, such decision shall not affect the validity of the Ordinance as a whole, or of any part hereof, other than the part held to be invalid. SECTION 3. Effective Date. This Ordinance shall take effect and be in force from and after its passage and publication. Dated: , 2011 Robert Uzpen — Mayor William Short - Clerk Summary of Ordinance 122 approved by City Council and published in the White Bear Press on .2011. CITY OF GEM LAKE, RAMSEY COUNTY, MINNESOTA ORDINANCE NO. 123 AN ORDINANCE AMENDING THE ZONING ORDINANCE OF GEM LAKE RELATING TO THE CONSIDERATION AND ALLOWANCE OF VARIANCES FROM THE ZONING ORDINANCE. THE CITY COUNCIL OF THE CITY OF GEM LAKE ORDAINS: SECTION 1. AMENDMENT. Section 3.2 of Ordinance 43K is amended, to delete the definitions of "Hardship, Undue" and "Variance". SECTION 2. AMENDMENT. Section 17.4 of Ordinance 43K is amended as follows (deleted text stmek thr-e.,g , new text underlined): Section 17.4 Variances 17.4.1 Purpose and Intent. The City Council, sitting as the Board of Appeal and Adjustment, may grant Variances from the strict applications of the provisions of this Zoning Ordinance and impose conditions and safeguards in the Variances so granted. These Variances shall be considered in cases where by reason of narrowness, shallowness, or shape of a lot or where by reason of exceptional topographic or water conditions or where other extraordinary and exceptional conditions of such lot exist, the strict application of the terms of the Zoning Ordinance would result in practical difficulties an undue hardship upon the owner of such lot in complying with the regulations of the zoning district in which said lot is located. "Practical difficulties." as used in connection with the grant of a variance means that the property owner proposes to use the property in a reasonable manner not permitted by the zoning ordinance• the plight of the landowner is due to circumstances unique to the property not created by the landowner,• and the variance if granted will not alter the essential character of the locality. Economic considerations alone shall do not constitute the terms fthe en ing Ordinance practical difficulties. Practical difficulties include, but are not limited to inadequate access to direct sunlight for solar energy systems. A variance may not be granted to allow any use that is not allowed in the zoning district in which the property is located. 17.4.2 Application. An application for any Variance from the Zoning Ordinance shall be made on a form provided by the City. If the Variance is to be considered in association with any other Building Permits, Conditional or Interim Use Permits, or Subdivision, all related applications shall be submitted simultaneously with the Variance application so as to represent the full intent of the applicant. The application(s) shall be accompanied by a fee payable to the City in an aggregate amount as established in the City's fee schedule. The application(s) shall state full all facts relied upon by the applicant and shall be supplemented by such maps, plans, or additional data for consideration of the Variance as required and communicated by the Zoning Administrator. A) An application will be considered complete on the date the application(s), fee(s), and all supplemental materials requested have been received by the Zoning Administrator. As required by law, the City shall act on the application within the period prescribed unless said required period is extended or waived. B) When reviewing variance applications, impact on the following criteria shall be reviewed and measured by the Planning Commission and City Council: 1) Adjacent Uses; and 2) Air and Water Quality; and 3) Traffic Generations; and 4) Public Safety and Health; and 5) Area Aesthetics; and 6) Economic Impact On The Entire Area; and 7) Consistency With The Comprehensive MunieipalPlan. 17.4.3 Referral to Planning Commission. The matter along with all related information shall be referred to the Planning Commission which shall review the application(s) and hear the applicant or representative thereof at its first regular meeting following receipt of complete application(s). To insure preservation of health, safety, and general welfare of the public, the Planning Commission shall have authority to request additional information from the applicant concerning the Variance or to retain expert testimony with the consent and at the expense of the applicant concerning the application. 17.4.4 Public Hearing. In consideration of the application(s), a public hearing shall be held before the Planning Commission or the City Council to receive public comment on the matter. Notice of the public hearing shall be published in the City's official legal publication not less than ten (10) nor more than thirty (30) days with said notice stating the date, time, place and a summary of the application. 17.4.5 Referral to City Council. The Planning Commission shall make written findings of fact in aeeefdanee witli Seeteeii i2.1.5and recommendation to the City Council which shall include such actions or conditions relating to the request as may be deemed necessary to carry out the intent and purpose of this Ordinance and the Comprehensive Munieipal Plan. J 17.4.6 Action by City Council. Upon receipt of the written recommendation of the Planning Commission and public comment, the matter shall be placed on the agenda for a regular meeting of the City Council, the date of such meeting to be not more than the number of days allowed by law after the date of receipt of a completed application unless such date is extended or waived. If no recommendation is transmitted to the City Council by the Planning Commission within thirty (30) days of its receipt, the City Council may take action without further communication from the Planning Commission. The City Council shall, in the form of a resolution, make a written finding of fact, convey its decision to approve or deny the application, pFeteet the publie health, safety, and . The Council may impose conditions on the grant of a variance provided that any condition imposed is directly related to a likely impact of the variance and in rough proportionality to the scope of said impact. Approvals shall require a majority vote of the City Council. 17.4.7 Issuance of Variance. Following a decision by the City Council to approve or deny the application, the Zoning Administrator shall promptly notify the applicant in writing of the decision of the City Council, said notice considered delivered upon deposit for delivery with the US mail. 17.4.8 Lapse of Variance. Any Variance issued shall lapse if not acted upon within one (1) year of the date of issuance. SECTION 3. Severability. Should any section, subdivision, clause or other provision of this Ordinance be held to be invalid in any court of competent jurisdiction, such decision shall not affect the validity of the Ordinance as a whole, or of any part hereof, other than the part held to be invalid. SECTION 4. Effective Date. This Ordinance shall take effect and be in force from and after its passage and publication. Dated: , 2011 Robert Uzpen — Mayor William Short - Clerk Summary of Ordinance 123 approved by City Council and published in the White Bear Press on .2011. CITY OF GEM LAKE HISTORY OF ALL CITY ORDINANCES NO. Title Passed Status 11/17/59 Repealed 10/15/63 by #01 An Ordinance Regulating The Subdivision of Land in the City of Gem Lake Ord #8 #02 An Ordinance Providing for the Permanent Registration of Qualified 2/16/60 Repealed 6/18/90 by Voters Ord #55 #03 An Ordinance Incorporating Provisions of the State Highway Traffic 7/19/60 Superseded by Ord #86 Regulation Act by Reference 2/19/08 #04 A Brush and Grass Fire Ordinance 9/18/61 Repealed 6/18/90 by The City Zoning Ordinance Ord #55 Superseded by Ord #43 #05 2/19/63 An Ordinance Granting Permission to Northern States Power Company to 12/20/82 Expired #06 7/16/63 Erect a Gas Plant and to use the streets for the purpose of maintaining gas mains #07 An Ordinance Granting Permission to Northern State Power Company to 7/16/63 Expired use the streets for the purpose of maintaining electric lines #08 An Ordinance Repealing Ordinance No.1 and regulating the subdivision of 10/15/63 Repealed 9/17/90 by land Ord #58 #09 An Ordinance Licensing and Regulating the sale of intoxicating liquor 12/17/63 In Effect #10 An Ordinance Adopting the Building Code by reference 3/17/63 Repealed 8/17/71 by An Ordinance Adopting the Electrical Code by reference Ord_ #24 Repealed 8/17/71 by #11 3/17/64 An Ordinance Regulating the Keeping of Dogs Ord #24 #12 1/27/65 Repealed 11/16/05 by _Ord #69 #13 An Ordinance Prohibiting the Use and Possession of Dangerous Weapons 1/27/65 Superseded by Ord #86 An Ordinance Amending the Official Zoning Map of Gem Lake 2/19/08 #14 7/18/67 Superseded by Ord #43 12/20/82 An Ordinance Defining Disorderly Housed, Prohibiting their maintenance 5/20/69 Repealed 2/19/08 by #15 and providing penalties for violation _ _ 6/17/69 Ord #86 #16 An Ordinance Defining Nuisances, Prohibiting their maintenance, and Superseded by Ord #86 providing penalties for violation An Ordinance Regulating Maximum Fines 2/19/08 #17A 8/19/69 Repealed 12/18/89 by Ord #53 #17B An Ordinance Amending Ordinance No. 5, The Zoning Ordinance 3/24/70 Superseded by #43 12/20/Ord /82 #17C A Curfew Ordinance 4/21/70 1 Superseded by Ord #86 2/19/08 An Ordinance Regulating the Operation of the Municipal Sanitary Sewer 7/21/70 Repealed 3/28/94 by #18 System An Ordinance Authorizing the Ramsey County Auditor and Treasurer to 9/15/70 Ord #64 In Effect #19 act as agents for the City of Gem Lake in Ramsey County to collect assessments NO. Title An Ordinance Regulating and Controlling the Use of Snowmobiles Passed Status #20 9/15/70 Repealed 11/21/77 by An Ordinance Amending the Zoning Ordinance Ord #32B #21 9/15/70 Superseded by Ord #43 An Ordinance Providing for New and Increased Salaries for the Officers 12/20/82 #22 11/09/70 Superseded by Ord #50 and Trustees of Gem Lake An Ordinance Prohibiting Open Burning 1 10/17/88 Repealed 6/18/90 by #23 02/16/71 An Ordinance Adopting the Uniform Building Code Ord #55 Repealed 6/13/01 by #24 8/17/71 Ord #78 #25 ' An Ordinance Establishing Sewer Service Availability and Connection 12/18/72 Repealed 3/28/94 by Charges to Pay Reserve Capacity Costs of Metropolitan Sewer Board Ord #64 Repealed 3/28/94 by #26 An Ordinance Amending Ord#18 and Prescribing Rates and Charges for 12/27/72 use of the Municipal Sanitary Sewer An Ordinance Amending Ord #18 and Ord #26 and Prescribing Rates and 2/19/73 Ord #64 #27 Repealed 3/28/94 by Charges for use of the Municipal Sanitary Sewer System An Ordinance Defining False Fire Alarms and Prescribing a Penalty for Ord #64 #28 4/16/73 Repealed 6/18/90 by making same Ord #55 #29 An Ordinance Amending Ordinance No #5 and Changing the Boundaries 12/16/74 Superseded by Ord #43 of the Zoning District Designated as General Business 12/20/82 #30 An Ordinance Amending Ordinance No#5 and Changing the Boundaries of 4/18/77 Supersede by Ord #43 the Zoning District Designated as General Business 12/20/82 #31 An Ordinance Amending Ordinance No#5 and Changing Minimum Area of 6/20/77 Superseded by Ord #43 Certain Property in an R-4 Residential District 12/20/82 #32A ' An Ordinance Establishing an Industrial User Strength Charge 6/20/77 Repealed 3/28/94 by An Ordinance Relating to the Operation of Snowmobiles and Repealing Ord# 64 #32B 11/21/77 Superseded by Ord #86 Ord #20 2/19/08 Superseded by Ord # 43 #33 An Ordinance Amending Ord No#5 and Changing the Boundaries of the 11/20/78 Zoning District Designated as Residential 12/20/82 #34A An Ordinance Amending Ordinance No 5 and Changing the Boundaries of 11/30/77 Superseded by Ord #43 the Zoning District Designated as Retail Business An Ordinance Amending Ord No 18 and Prescribing Rates and Charges for 12/18/78 12/20/82 #34B Repealed use of the Municipal Sanitary Sewer System An Ordinance Amending Ord No 5 and Changing the Boundaries of the 12/27/79 Superseded by Ord #43 #35 Zoning District Designated as Retail Business An Ordinance Amending Ordinance No 5 the Gem Lake Zoning 1/21/80 12/20/82 #36 Superseded by Ord #43 12/20/82 #37 An Ordinance Amending Ord No 18 and Prescribing Rates and Charges for 5/18/81 Repealed use of the Municipal Sanitary Sewer System #38 An Ordinance Amending Ord No 5, The Gem Lake Zoning Ordinance 5/18/81 Superseded by Ord #43 12/20/82 #39 An Ordinance Amending Ord No 28, An ordinance Defining False Fire 8/7/81 Repealed Alarms #40 An Ordinance Amending Ord No 5, The Gem Lake Zoning Ordinance 9/22/81 Superseded by Ord #43 12/20/82 NO Title Passed Status #41 An Ordinance Amending Ord No 5 and Changing the Boundaries of the 10/19/81 Superseded by Ord #43 Zoning District Designated as Retail Business 12/20/82 #42 An Ordinance Amending Ord No 5 and Changing the Boundaries of the 10/19/81 Superseded by Ord #43 Zoning District Designated as LD-B Low Density Business District 12/20/82 Superseded by Ord #43 An Ordinance Restating the Zoning Ordinance of Gem Lake 12/20/82 An Ordinance amending Ord 43 (referred to as 43F) concerning LDB #43H 7/24/06 #43G 2/21/06 Superseded by Ord district standards, building heights, and storm water management #43H 7/24/06 Superseded by Ord #431 #43H An Ordinance amending Ord #43 (referred to as 43G) amending and re- 7/24/06 ordering the provisions of Orf #43, and altering building height and other 12/21/06 performance standards #431 An Ordinance amending Ord #43 (referred to as 43H) to add automobile _ 12/21/06 Superseded by Ord #43J rental as a permitted conditional use in the RB District 1/16/07 1/16/200 In Effect #43J An Ordinance amending Ord #43 (referred to as 431) to add Section 13, Planned Unit Development 7 8/15/83 #44 An Ordinance Relating to Issuance of Burning Permits Repealed 5/21/01 by �— Ord #77 #45 An Ordinance Regulating the Disposal of Garbage, Rubbish and other In Effect 8/15/83 Refuse and Providing Penalties for Violation Thereof #46 An Ordinance Regulating Seepage Disposal and the Design, Location, 8/15/83 Repealed 12/29/97 by Installation, Renovation, Operation, Maintenance and Inspection of Ord #67 Individual Sewage Treatment Systems An Ordinance Related to Gambling by Allowing Operation and Sale of Repealed 5/18/92 by #47 5/18/87 Gambling Devices in On -Sale Liquor Establishments An Ordinance Regulating the Use of Alarm Systems, Establishing User I Ord #60 In Effect #48 8/17/87 Fees, Establishing a System of Administration of such Alarms, and providing penalties for false alarms An Ordinance Making amendments to Ord 43 #49 9/19/88 Superseded by Ord #43H 7/24/06 #50 An Ordinance Providing for Compensation for the Mayor, Council 10/17/88 Repealed 8/17/92 by Members, Treasurer and Clerk An Ordinance Making amendments to Ord 43, including the Ord #62 #51 2/20/89 Superseded by Ord Establishment of a New District known as General Business II _ #43H 7/24/06 #52 An Ordinance Amending Ord 9, Changing the requirements for Liquor 11/20/89 Incorporated in Ord #9 License Application and changing the Annual Fees for Liquor Licenses #53 An Ordinance Regulating Maximum Fines (amending all ordinances with 12/18/89 Incorporated in Ords. references to fines) Applicable #54 An Ordinance amending Ord 18 and prescribing Rates and Charges for use 3/19/90 Repealed 3/28/94 by of the Municipal Sanitary Sewer System Ord #64 #55 An Ordinance Repealing Ord 2 and providing for the restatement of all 6/18/90 N/A City Ordinances effective as of June 18, 1990 other than the Zoning Ordinance and Ordinances Amendatory thereof and the Subdivision Ordinance An Ordinance granting Northern States Power Company permission to 7/16/90 #56 In Effect erect and maintain a gas distribution system and the use of public ways and grounds. ___ No Title Passed Status #57 An Ordinance granting Northern State Power Company permission to 7/16/90 In Effect erect and maintain an electric distribution system and the use of public ways and grounds #58 An Ordinance repealing Ord 8 and regulating the subdivision of land in 9/17/90 Repealed 8/15/05 by the City of Gem Lake An Ordinance amending Ord #58 eliminating subject headings, timelines Ord #586 #5813 8/15/05 Superseded by Ord #58C and specific references to fees, and restating_ as #5813 _ An Ordinance amending Ord 58B regarding park dedication and restating 7/24/06 #58C 7/26/06 In Effect the subdivision Ord of Gem Lake with all Amendments thereto enacted through 24 July 2006 and regulating the subdivision of land in the City of Gem Lake. #59 An Ordinance amending Ord 47 and related to Gambling by allowing 5/13/91 Repealed 5/18/92 by operation and sale of gambling devices in on -sale Liquor establishments. An Ordinance replacing Ord 59 and related to Gambling by allowing Ord #60 #60 5/18/92 In Effect operation and sale of gambling devices in on -sale liquor establishments #61 An Ordinance defining bi=annual inspection and maintenance routines for 6/15/92 Repealed 12/29/97 by on -site sewage disposal systems located in the City of Gem Lake, Ramsey Ord #67 County, Minnesota #62 An Ordinance replacing ord No 50 and providing for compensation for the 8/17/92 Repealed 1/1/99 by Ord Mayor, Council Members, Treasurer and Clerk #70 #63 An Ordinance amending Ord 43 and replacing Ord No 5 3/28/94 Superseded by Ord 43H An Ordinance replacing Ord No 18, Bi 25 and No 32A and regulating the 7/24/06 _ Superseded by Ord 64E #64 3/28/94 operation of the Municipal Sanitary Sewer System, prescribing rates and 7/14/04 charges for use of the system, providing licensing of Sewer Contractors, and prescribing penalties for the violations thereof. _ #64E An Ordinance amending Ord #64 by adding and amending definitions, 7/14/200 In Effect connection requirements, rates and charges, Contractor Licensing and 4 cost assessment and incorporating changes(and also Ord 81 changes) into Ord #64 as Ord # 64E In Effect #65 An Ordinance licensing and regulating the sale and consumption of non- 6/19/95 intoxicating liquor and providing a penalty for violation An Ordinance regulating tree and natural barrier protection and 8/28/95 In Effect #66 preservation An Ordinance repealing Ord No 46 and Ord No 61 and regulating Septage 12/29/97 #67 Superseded by Ord #6713 Disposal, the design, location, installation, renovation, operation, 7/14/04 maintenance and inspection of individual sewage treatment systems. _ _ __ #676 An Ordinance amending #67 by adding and amending definitions, design 7/14/200 In Effect and location criteria, setback requirements, and replacement 4 requirements for seepage systems An Ordinance regulating the sale, distribution, possession, and use of In Effect #68 3/13/05 tobacco, tobacco products and tobacco related devices in the City of Gem Lake and to provide penalties for violations and to reduce the illegal sale, distribution, possession, and use of such items to and by minors No Title Passed Status #69 An Ordinance regulating the keeping of dogs, cats, horses, and other 11/16/05 In Effect #70 #70B #71 #72 animals within the City of Gem Lake An Ordinance repealing Ord 62 and providing for compensation for the Mayor and Council Members An Ordinance amending Ord 70 and providing for compensation for the Mayor and Council Members An Ordinance describing the provisions for a planned unit development(PUD) within the City of Gem Lake An Ordinance adopting changes, additions or deletions to the Zoning Ordinance No 43 or the City of Gem Lake, MN for an Institutional Overlay District #73 An Ordinance repealing Ord No snowmobiles and other off -road penalties for the violation thereof. 32B and regulating the operation of recreational vehicles and providing 1/1/99 12/19/05 Not passed 5/18/98 Not passed Repealed 12/19/05 by Ord #70B In Effect Superseded by Ord 43H 7/24/06 #74 An Ordinance amending Ord No 43, the Zoning Ordinance of the City of 11/15/99 Superseded by Ord Gem Lake regarding 1) the addition Pf section 21 establishing commercial #43H 7/24/06 broadcast/telecommunications tower and antenna regulations and definitions and amendments attendant thereto; and 2) the removal of all fee schedules from the Zoning Ordinance; and 3) the revision Pf Section 4.10 land reclamation and 4.11 land mining of the Zoning Ordinance. #75 An Ordinance amending the Zoning Map and Section 6.2 of Ord 43, the 2/02/00 Superseded by Ord Gem Lake Zoning Ordinance, regarding rezoning of certain R-4 residential #43H 7/24/06 lands to R-3 residential Zoning. Superseded by Ord #76 An Ordinance amending City of Gem Lake Ord 43, hereinafter the Zoning 2/20/01 Ordinance regarding: 1) adding provisions for minimum "buildable area" #43H 7/24/06 as Section 4.4(3), definition for "buildable area" as Section 3.2 (4A), and amending tables 7.5 (1), 8.5 (1), 9.5 (1), 10.5 (1)a), and 10.5 (1) to reflect i said provisions; 2) amending definitions of and related to variances and special use permits and adding definitions for interim use permits; 3) providing amended or additional provisions for the City's consideration of applications for variances, special use permits, Interim use permits, redistricting or other amendments to ord No 43; 4) modification of the lakeshore restrictions on the body identified as Gem Lake. An Ordinance repealing City of Gem Lake Ord 44 and providing for; 1) 5/21/01 #77 Repealed 12/21/06 adoption of the "Minnesota Uniform Fire Code"; 2) establishing prohibited conditions to prevent fires; 3) appointment of fir department, fire chief and fire marshal by the City Council: 4) adding requirements for fire inspections and associated fees in the City's commercial zones and uses; and 5) reestablishing requirements for issuance of burning permits. An Ordinance repealing City of Gem Lake Ord 24 and providing for: 5/21/01 _ Repealed 12/21/06 by #78 adoption of the Minnesota State Building Code; the application, Ord #78B administration and enforcement of the Minnesota State Building Code; the issuance of permits and the setting and collection of fees therefore; and providing penalties for violation thereof. Np Title Passed Status #78B An Ordinance repealing Ord 78 and providing for adoption of the 12/21/06 In Effect Minnesota State Building Code, the application, administration and -� enforcement of same, the issuance of permits and the setting and collection of fees therefore, and providing penalties for violation thereof. Superseded by Ord #79 An Ordinance providing for amendment of Ord 43, the "Zoning 12/15/03 Ordinance" as follows: 1) adding definitions to Section 3.2; and 2) #43H 7/24/06 deleting section 22, regulation of the body of water called Gem Lake, in its entirety; and, 3) adding new Section 11, regulation o bodies of water, wetlands, and shoreland zones to establish local controls that consistently reflect the purpose and intent stated in the Comprehensive Municipal Plan and its attendant Watershed Management Plan; and 4) amending tables for all districts defining area, frontage and yard requirement to include the term "foot setback", and, 5) adding provisions for vegetation removal and alteration permits; and 6) adding Sections 4.1(5) and 4.1(6) and, 7) amending section 5.4(5), 5.7(6), 5.5 (5), 5.6 (5) and 8) deleting section 17 in its entirety and copying the text of section 17.1 to section 12 as section 12.6; and 9) amending the legend of Ord 43 to record the date of all changes contained herein. An Interim Ordinance adopting a moratorium for the purpose of 4/19/04 Repealed 5/12/04 by #80 protecting the planning process and the health, safety and welfare of the publication of Ord #82 citizens of Gem Lake by restricting and prohibiting sexually oriented businesses. #81 An Ordinances amending Ord 64 by recodifying and expanding section 3.2 1/21/03 Superseded by Ord #64E definitions, upgrading references to the Metropolitan Council 7/14/04 Environmental Services, Recodifying table 5.41 (4)d, providing for administration of the ordinance. In Effect _ #82 An Ordinance repealing Ord 80 and providing for the location, regulation, 4/19/04 licensing, operation and inspection of adult uses and sexually oriented businesses in the City of Gem Lake and penalties for violation of said regulation. Housing Maintenance Code 2/19/08 General Business Licensing Procedure 2/19/08 Home Occupation Regulations 2/19/08 Gem Lake Nuisance Code, restating prior ordinances of the City relating to 2/19/08 #83 In Effect #84 In Effect #85 In Effect #86 In Effect nuisances, regulating methamphetamine labs and cleanup, and establishing new procedures for abating nuisances. Amending Ord 78 (Building Code) to require city licenses for certain home 10/21/08 #87 Incorporated in Ord construction contractors as new Section 7 #78B #88 Amendment to 17.8.2 of Zoning Ordinance requiring escrow of funds 10/21/08 Incorporated in ORd Amendment to 11.2.1 of Ord 58C requiring escrow of funds #43J #89 10/21/08 Incorporated in Ord Tabled #58C #90 Municipal Water Code, establishing standards for construction, connection, installation, and administration of a city water system. #91 Operations and administration ordinance, formalizing City procedures 2/19/08 In Effect and establishing boards and commissions In Effect #92 Environmental Review Ordinance, establishing procedure for requiring 10/21/08 environmental review of proposed projects. #93 Amendment to Ord 64E (Sewers) allowing for collection of unpaid 2/10/09 Incorporated in Ord 64E connection charges _ Incorporated in Ord #84, Ord #9 and Ord #65 #94 1 Ordinance establishing procedures for review and revocation of licenses, 1 2/10/09 and amending existing liquor licensing ordinances, conforming fee collection to State law #95 Ordinance establishing regulations for the operation of pawnbroker shops 10/21/08 In Effect #96 Amending ordinances related to pets and domestic animals to require Pending permits for kennels and stables. Establishing standards for construction, maintenance and oversight of city #97 Tabled streets, procedures for requesting repairs to streets, and regulating use of streets #98 Ordinance allowing for partial prepayment of assessments for local 2/10/09 In Effect improvements. #99 Authorizing the compilation and publication of a City Code. Pending #100 Landscaping Ordinance Moratorium for Gateway planning area Amendment to Ord 60 regarding "bar operation" allowance Extension of Ord #101, Gateway moratorium Amendment to Zoning Ordinance to alter list of conditional uses in GB II Zone 10/21/08 In Effect #101 11/20/07 Extended by #103 #102 10/21/08 Incorporated in Ord #60 #103 7/22/08 In Effect Incorporated in Ord #43J #104 10/21/08 #105 Ordinance regarding back ground checks for licensing and employment 1/20/09 In Effect #106 Ordinance regulating dangerous and potentially dangerous dogs 2/10/09 Incorporated in Ord #69 #107 An Ordinance revising the Zoning Ordinance (No 43J) by deleting existing 6/3/09 In Effect sections 9, 10, 11 & 12. Replacing deleted sections with a new chapter 9, Gateway District; amending the official zoning map; restating zoning ordinance as no 43K In Effect #108 An Ordinance revising the 1sts ordinance (No 6713) to require annual 7/29/09 inspection of individual septic systems_ _ In Effect #109 An Ordinance establishing sign regulations in the City of Gem Lake, and 10/28/09 repealing prior versions of sign regulations. In Effect #110 An Ordinance to permit and regulate the keeping of pigeons in the City of 10/28/09 Gem Lake, amending ordinance No. 69 #111 An Ordinance regulating the conduct of peddlers, solicitors, and transient In Effect merchants within the City of Gem Lake #112 An Ordinance establishing procedures for the administrative citation of 1/19/10 In Effect traffic offenses in Gem Lake An Ordinance to administer and regulate the public right of way in the #113 1/27/10 In Effect public interest and to provide for the issuance and regulation of right of way permits CITY OF GEM LAKE, MN . —s 4200 Otter Lake Road z— Gem Lake, MN 55110-3227 Telephone 651-747-2790 E-mail Citv(a),gemlakelN/IN.or� Minutes of Gem Lake City Council Meeting 15 May 2012 The regular meeting of the City Council of the City of Gem Lake was called to order by Mayor Uzpen on Tuesday, May 15, 2012 at 7:02 pm in the Gem Lake City Hall meeting room. The following members were present: Mayor Robert Uzpen, Councilmembers James Lindner, Gretchen Artig-Swomley, Richard Bosak and Thomas Rasmussen. Members of the public attending per the sign in sheet sent around the room. APPROVAL OF AGENDA AND MEETING MINUTES City Council Agenda: Mayor Uzpen called for additions, deletions and corrections to the agenda. Upon motion by Councilmember Bosak, and seconded by Councilmember Artig-Swomley, the May 15, 2012 agenda was approved. Ayes — 5, Nays — 0. Planning Commission April Meeting Minutes: The Planning Commission April minutes were presented and corrections were needed. Upon motion by Councilmember Rasmussen, and seconded by Councilmember Artig-Swomley, the April Planning Commission minutes were accepted. Ayes — 5, Nays — 0. City Council April Meeting Minutes: The April 2012 minutes were presented and corrections were needed. Upon motion by Councilmember Artig-Swomley, and seconded by Councilmember Bosak, the minutes of April 2012 were accepted with corrections being made. Ayes —4, Nays — 0, Abstained - 1. Planning Commission Chair Report: Chairperson Faith Kuny reported to the council that the Planning Commission approved the Chicken Ordinance and forward to the City Council. OLD BUSINESS Newsletter: Councilmember Artig-Swomley stated she would like to do an article on Vera Auto and the LaRoma restaurant. The City Clean -Up day. Councilmember Artig- Swomley received an email from one of the residents regarding a police report from Alabama on some of the things people pick up along the road that people throw out. Gem Lake City Council Meeting Page 2 of 6 An article on National Night Out. A story on Garlic Mustard that is a plant that covers many yards. Settlers adopted it long ago, as it is a flowering plant with a white flower on it that grows quickly. In addition, a story on Jessie Hart's departure and the story on the chicken coop ordinance. In addition, the Honeymoon House and the Waste Management recycling which Councilmember Artig-Swomley found on their website. In addition, a story on Rachael the recipient of City of Gem Lake's scholarship she received. PUBLIC HEARING None NEW BUSINESS Carlson CUP: Mr. and Mrs. Carlson, residents of the City of Gem Lake want to have a small number of chickens on their property. They came to the City to get a permit and went before the Planning Commission. Planning Commission Chairperson Faith Kuny stated that the Planning Commission felt when the City Council puts together the chicken ordinance; they felt 25 chickens would be the maximum number of chickens to have. In addition, there was some question on the fee for the chickens. The Carlson's are going to have five (5) chickens on their property and the fee would be $50. Commissioner Herzog did some research on twelve (12) other residents who own chickens in Gem Lake. Most people are raising chickens for their personal use. She feels the fee should be $10 like a dog license, with something written to make sure that the chickens are maintained and if the smell is drifting over to the neighbors, there would be a $100 fine. Mayor Uzpen explained what the fees covered and how the surrounding cities have the same fees. The fee covers the cost of having the property inspected and the cost of the permit. Councilmember Lindner read from Ordinance #69, Section 3.8: "... It would be unlawful to keep or harbor in the City, any animals without first obtaining written Conditional Use Permit from the City of Gem Lake..." Councilmember Artig-Swomley stated that there should be wordage regarding having a rooster as when they are babies, it is hard to tell the sex of the chicken. Councilmember Bosak feels before voting on the ordinance, the City Council should do more research. Upon motion by Councilmember Lindner and seconded by Councilmember Artig- Swomley, the Conditional Use Permit for purchasing and keeping chickens has passed. Ayes — 5, Nays — 0. Look for us on the World Wide Web at geralakemn.org Gem Lake City Council Meeting Page 3 of 6 Claims for May: The claims for May were discussed and authorized to pay. Upon motion by Councilmember Lindner and seconded by Councilmember Bosak, motion passes. Ayes — 5, Nays — 0. Monthly Financial Reports: The City Council received and reviewed the report. City Attorney Update: Status of Garden Overlay Permits for Bryan Hansen: Mayor Uzpen received an email from Pat Kelly regarding the permit for Mr. Hansen. Mayor Uzpen will be meeting with Mr. Hansen in a few weeks when he is back in town. The issue is the cost of the permits. Mayor Uzpen feels the Comp Plan needs to be changed as the land is zoned for Gateway, but the land is being used for agricultural versus residential. City Attorney Trevor Oliver feels the Comp Plan does not need to be changed; the wordage can be changed to farming. Tom Riedesel from White Bear Township wants to get a resolution to the Comp Plan. The City Council will need to approve the current Comp Plan at the June City Council meeting to bring it current and then make any changes. Status of Updating the Cities Watershed Ordinance: Attorney Oliver has started putting the ordinance into word format. VLAWMO takes care of the watershed for the City of Gem Lake and is responsible fro the run-off drain. Planning Commission Chairperson Faith Kuny will put it on the agenda for the June Planning Commission meeting. Monthly or Yearly Fees to Senior Citizen Developments: Attorney Oliver stated there is nothing specific regarding cities charging a fee. Most Senior Citizen facilities are non-profit. It depends on who owns the facility. For the most part, there is an exception of property tax for non-profit facility. Most cities will work out the service charge for the services: street maintenance, police, water and utilities to name a few. There will be a tax based on housing. PRESENTATIONS FROM THE PUBLIC None OPEN ITEMS FROM THE CITY COUNCIL Mayor Uzpen has reviewed the Gateway Ordinance, especially by the matrix, wants to know what is forbidden? There is nothing in the ordinance that states that a hockey rink or hotel that requires a Conditional Use Permit. Attorney Oliver explained that if it is not on the matrix, then it is not allowed. There are four (4) categories, but the ordinance can be amended. The developer should be told of the above issues. Matrix issues state they cannot be open past 10 to 11 p.m. Mayor Uzpen requested that Attorney Oliver work on this and notify the developers regarding the commercial issues. Look for us on the World Wide Web at gemlakemn.org Gem Lake City Council Meeting Page 4 of 6 Planning Commission Chairperson Faith Kuny had talked to Tom Riedesel regarding zoning and it can be built under commercial east of Highway 61 in the business district. Anything built on open properties will be on the residential property and will have to be amended. Mayor Uzpen stated that commercial building on Hoffman Corners, but anything west of Tousley Ford is a different issue. Mayor Uzpen mentioned Gem Lake Lodge and asked Trevor if the City Council should amend this. City Attorney Oliver mentioned that Gem Lake might need to offer a helping hand and a conversation needs to take place regarding this development between Gem Lake and the developer. A Public Hearing would need to take place regarding the hotel. Councilmember Rasmussen feels the developer needs to be told the ordinance would need to be amended and see if the interest is still there. Councilmember Artig-Swomley feels that a Public Hearing needs to take place regarding the medical office building next to the Fairfield/Marriott hotel. Councilmember Lindner attended the VLAWMO seminar and there was discussion regarding the Gem Lake being removed from the State compared water list. The City only has to clean up 24% of the sediment being deposited. The City would need to meet with the business owners on Highway 61 by that lake to discuss the issue. l Mayor Uzpen updated the City Council on the Tangwell issue. They have until May 1, 2012. They have been given information on the six plants that can be planted per two feet on the shoreline. White Bear Township Inspector Mike Johnson has looked over the property and stated that they will need to plant some more greenery and has requested a list of what plants were planted. FUTURE COUNCIL MEETINGS Workshop Meeting: June 11, 2012 at 7:00 p.m. City Council Meeting: June 19, 2012 at 7:00 p.m. Look for us on the World Wide Web at gemlakemn.org Gem Lake City Council Meeting Page 5 of 6 ADJOURN The May15, 2012 regular meeting of the City Council adjourned at 8:01 p.m. Upon motion by Councilmember Lindner, and seconded by Councilmember Rasmussen, the City Council meeting was adjourned. Ayes — 5, Nays — 0. APPROVED: ATTEST: ATTEST: Julie Newkirk Robert Uzpen Recording Secretary Mayor Look for us on the World Wide Web at gemlakemn.org Gem Lake City Council Meeting Page 6 of 6 SIGN UP SHEET: Diane Carlson Beth & Steve Herzog Amber Peterson Beckie Pierce Karl Helkamp Tim Waldoch Lynette B erdan Leanna McReynolds Nick Johnson Faith Kuny Dani Hronoski Trevor Oliver Look for us on the World Wide Web at gemlakemn.org CITY OF GEM LAKE, MN 4200 Otter Lake Road _ Gem Lake, MN 55110-3227 _ Telephone 651-747-2790 E-mail City a aemlakeMN.org Gem Lake Planning Commission Meeting 1 May 2012 The regular meeting of the Planning Commission of Gem Lake was called to order by Chairperson Faith Kuny on Tuesday, May 1, 2012 at 7:03 p.m. at the Gem Lake City Hall conference room. The following members were present: Chairperson Faith Kuny, and Planning Commissioners Arthur Pratt and Beth Herzog. Commissioners Dan Marier and Derrick Wippich were not in attendance. Planning Commission May Agenda: Chairperson Kuny asked for any changes, deletions, or added agenda items. None was given and upon motion by Commissioner Pratt and seconded by Commissioner Herzog; the May 1, 2012 agenda was approved. Ayes — 3, Nays — 0. April Planning Commission Minutes: The April Planning Commission minutes were reviewed and upon motion by Commissioner Pratt and seconded by Commissioner Herzog, the April Planning Commission minutes were approved. Ayes — 3, Nays — 0. OLD BUSINESS Update Regarding Daniels Farm Road Neighbor Meeting with Developer: Chairperson Faith Kuny updated the Planning Commission regarding the meeting that took place with the developer. Chairperson Kuny kept hearing from the residents that they feel the current Gateway Ordinance is a compromise and when the residents bought their properties and built their homes it was zoned as residential. The developer discussed that they would review and work on their plans to fit the Gateway Ordinance. Chairperson Kuny asked the developer if they had thought about building near highway 61. PUBLIC HEARING Conditional Use Permit for 3 to 5 chickens requested by Diane and Anthony Carlson on the residential property of 1501 Goose Lake Road, Gem Lake, MN: Gem Lake Planning Commission Minutes Page 2 of 4 The Carlson's approached the City of Gem Lake asking if they could raise chickens on their property. Under the fee guidelines of Gem Lake, a Conditional Use Permit is $1,600. There is now a special fee schedule for raising chickens. The fee is one to three chickens; $25 fee with a $15 annual renewal. If you have four or more chickens; $50 fee with a $15 annual fee. The initial fee is because Tom Riedesel from White Bear Township would need to visit the property to see where the chickens will be placed. Public Hearing opened at 7:07 p.m. Mr. Carlson explained that they will be ordering a chicken coop to place behind the garage to keep the chickens inside with the idea of buying four or five chickens that lay eggs for their family. Chairperson discussed the issue when buying chicken, there is a chance that one of the chickens would be a rooster. Mr. Carlson stated that if they got a rooster, it would be dinner. Councilmember Tom Rasmussen discussed that the City Council wants the Ordinance to be re -written and will put something together reviewing what the surrounding communities have done with chickens. Chairperson Kuny stated to Mr. Carlson that a site plan would be needed going with the guidelines of the Conditional Use Permit. Mr. Carlson expressed that where the chickens will be spring through fall no one can see the area due to foliage and trees surrounding the yard. Public Hearing closed at 7:18 p.m. Commissioner Herzog stated that she moved to the City of Gem Lake specifically because you could have small poultry, but knows plenty of people in Gem Lake that are raising chickens. She feels the fees are too high and feels the residents should be able to go up to a dozen chickens with a $10 fee. Some people raise the chickens to eat and that is a two month process. If chickens are ordered through Murray, there is a 25 chicken order minimum. Inspection will be one time, so cost seems to be okay with that, but need to clarify with City Attorney Trevor Oliver. Attorney Oliver did suggest to Chairperson Kuny to view the Pigeons Ordinance. Councilmember Rasmussen stated that all residents of Gem Lake will require going through this process if they are raising chickens and will have to pay a fee. Chairperson Kuny wants to know if an inspection of the chickens will be yearly thing. If so, then that justifies the fees. Look for us on the World Wide Web at gemlakemn.org Gem Lake Planning Commission Minutes Page 3 of 4 Mr. Carlson feels that all residents raising chickens will be grandfathered in and he will be the first tested and wants to just buy the chickens and pay the fee required. Upon motion by Commissioner Herzog and seconded by Commissioner Pratt, the Planning Commission recommends moving this forward to the City Council to approve the Conditional Use Permit and be accepted as stated. Ayes — 3, Nays — 0. NEW BUSINESS Clean Water Goals for Community Meeting on May 3, 2012: City Council member James Lindner explained the issue of shallow lakes having nothing that churns up the water. The water run-off makes it worse. Councilmember Lindner is going to a Clean Water workshop with VLAWMO regarding water issues on Thursday also. The U of M will be involved with that meeting. Commissioner Herzog requested a phone number to call if a truck dumps some waste matter and is in violation. VLAWMO does do reading/studies from the lakes. They have done a great job of restoration on Bush Lake. OPEN ITEMS None FUTURE MEETINGS: Planning Commission Meeting: June 5, 2012 at 7:00 p.m. ADJOURN: Upon motion by Commissioner Herzog and seconded by Commissioner Pratt, the May 1, 2012 regular meeting of the Planning Commission was adjourned at 7:44 p.m. Ayes — 3, Nays — 0. APPROVED: ATTEST: ATTEST: Julie Newkirk Faith Kuny Recording Secretary Chairperson Look for us on the World Wide Web at gemlakemn.org Gem Lake Planning Commission Minutes Page 4 of 4 Sign In Sheet: Tom Rasmussen Anthony Carlson James Lindner Look for us on the World Wide Web at gemlakemn.org CITY OF GEM LAKE, MINNESOTA FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION YEAR ENDED DECEMBER 31, 2011 CITY OF GEM LAKE 4200 OTTER LAKE ROAD GEM LAKE, MINNESOTA 55110 CITY OF GEM LAKE, MINNESOTA TABLE OF CONTENTS YEAR ENDED DECEMBER 31, 2011 I. FINANCIAL SECTION INDEPENDENT AUDITORS' REPORT 1 BASIC FINANCIAL STATEMENTS STATEMENT OF NET ASSETS 3 STATEMENT OF ACTIVITIES 4 BALANCE SHEET - GOVERNMENTAL FUNDS 5 RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET ASSETS - GOVERNMENTAL ACTIVITIES 7 STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - GOVERNMENTAL FUNDS 8 RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE TO THE STATEMENT OF ACTIVITIES - GOVERNMENTAL ACTIVITIES 10 STATEMENT OF NET ASSETS - PROPRIETARY FUND 11 STATEMENT OF REVENUES, EXPENSES AND CHANGE IN NET ASSETS - PROPRIETARY FUND 12 STATEMENT OF CASH FLOWS - PROPRIETARY FUND 13 NOTES TO BASIC FINANCIAL STATEMENTS 14 REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON INFORMATION SCHEDULE OF REVENUES, EXPENDITURES AND CHANGE IN FUND BALANCE - BUDGET AND ACTUAL - GENERAL FUND 29 NOTE TO REQUIRED SUPPLEMENTARY INFORMATION 30 COMBINING FUND FINANCIAL STATEMENTS NONMAJOR GOVERNMENTAL FUNDS COMBINING BALANCE SHEET 31 COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGE IN FUND BALANCE 32 CITY OF GEM LAKE, MINNESOTA TABLE OF CONTENTS (CONTINUED) YEAR ENDED DECEMBER 31, 2011 II. OTHER REQUIRED REPORTS REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS 33 REPORT ON MINNESOTA LEGAL COMPLIANCE 35 SCHEDULE OF FINDINGS AND RESPONSES 36 FINANCIAL SECTION :_ J-' Clifton LarsonAllen LLP Ar %muliftonlarsonallen.com Clifton LarsonAllen INDEPENDENT AUDITORS' REPORT Honorable Mayor Members of the City Council and Citizens City of Gem Lake Gem Lake, Minnesota We have audited the accompanying financial statements of the governmental activities, the business - type activities, each major fund, and the aggregate remaining fund information of the City of Gem Lake, Minnesota as of and for the year ended December 31, 2011, which collectively comprise the City's basic financial statements as listed in the table of contents. These financial statements are the responsibility of the City's management. Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United State of America and the standards applicable to financial audits contained in Government Auditing Standards. issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of Gem Lake, Minnesota as of December 31, 2011, and the respective changes in financial position and cash flows, where applicable, thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America. As discussed in the notes to the financial statements, the City adopted the provisions of Government Accounting Standards Board Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions, as of and for the year ended December 31, 2011. This statement results in the City reporting nonspendable, restricted, assigned, and unassigned fund balances in its governmental fund types. In accordance with Government Auditing Standards, we have also issued our report dated June 14, 2012 on our consideration of the City of Gem Lake, Minnesota's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, grant agreements, and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. (1) Honorable Mayor Members of the City Council and Citizens City of Gem Lake Accounting principles generally accepted in the United States of America required that the budgetary comparison information as listed in the table of contents, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. The City of Gem Lake has not presented the management's discussion and analysis that the Government Accounting Standards Board has determined to be necessary to supplement, although not required to be part of, the basic financial statements. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City's basic financial statements. The accompanying combining fund financial statements, as listed in the table of contents, are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining fund financial statements are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the basic financial statements taken as a whole. Minneapolis, Minnesota June 14, 2012 (2) CliftonLarsonAllen LLP BASIC FINANCIAL STATEMENTS CITY OF GEM LAKE, MINNESOTA STATEMENT OF NET ASSETS DECEMBER 31, 2011 ASSETS Cash and Investments Taxes Receivable Special Assessments Receivable Accounts Receivable Accrued Interest Prepaid Expenses Unamortized Bond Issue Costs Capital Assets: Capital Assets Being Depreciated Accumulated Depreciation Total Assets LIABILITIES Vouchers and Accounts Payable Accrued Interest Payable Unearned Revenue Long -Term Liabilities: Amounts Due Within One Year Amounts Due in More than One Year Total Liabilities NET ASSETS Invested in Capital Assets, Net of Related Debt Restricted for Debt Service Restricted for Park Improvements Unrestricted Total Net Assets See accompanying Notes to Basic Financial Statements. Governmental Business -Type Activities Activities Total $ 812,292 $ 303,208 $ 1,115,500 24,685 - 24,685 326,518 4,681 331,199 14,486 16,458 30,944 2,968 1,259 4,227 1,186 7,029 8,215 26,394 - 26,394 1,628,210 617,539 2,245,749 (368,364) (86,973) (455,337) 2,468,375 863,201 3,331,576 20,013 144 20,157 21,700 - 21,700 5,280 5,280 100,452 1,141.230 1,288,675 100,452 - 1,141,230 144 1,288,819 18,165 530,566 548,731 578,769 - 578,769 38,044 - 38,044 544.722 332,491 877,213 $ 1,179,700 $ 863,057 $ 2,042.757 (3) FUNCTIONS/PROGRAMS GOVERNMENTAL ACTIVITIES General Government Public Safety Public Works Conservation and Development Interest and Fiscal Charges Total Governmental Activities BUSINESS -TYPE ACTIVITIES Sewer Total Primary Government CITY OF GEM LAKE, MINNESOTA STATEMENT OF ACTIVITIES YEAR ENDED DECEMBER 31, 2011 Net (Expense) Revenue and Program Revenues Changes in Net Assets Fees, Charges, Operating Capital Business - Fines, and Grants and Grants and Governmenta Type Expenses Other Contributions Contributions I Activities Activities Total $ 113,445 $ 48,748 $ 8,299 $ $ (56,398) $ $ (56,398) 100,675 - - (100,675) (100,675) 68,837 13,548 16,552 (38,737) (38,737) 33,977 - - (33,977) (33,977) 58,094 (58.094) (58.094) 375,028 62,296 8,299 16,552 (287,881) (287,881) 35,719 49.783 $ 410,747 5 112,079 $ 8,299 S 16,552 GENERAL REVENUES Taxes: Property Taxes, Levied for General Purposes Property Taxes, Levied for Debt Service Investment Earnings Miscellaneous Total General Revenues CHANGE IN NET ASSETS Net Assets - Beginning of Year NET ASSETS - END OF YEAR See accompanying Notes to Basic Financial Statements. (4) 14,064 14 064 (287,881) 14,064 (273,817) 255,516 255,516 47,077 - 47,077 8,969 3,658 12,627 554 554 312,116 3,658 315,774 24,235 17,722 41,957 1.155.465 845.335 2,000,800 S 1.179.700 S 863.057 S 2,042,757 CITY OF GEM LAKE, MINNESOTA BALANCE SHEET GOVERNMENTAL FUNDS DECEMBER 31, 2011 ASSETS Cash and Investments Taxes Receivable Special Assessments Receivable Accounts Receivable Accrued Interest Receivable Due from Other Funds Prepaid Expenses Total Assets LIABILITIES AND FUND BALANCES LIABILITIES Vouchers and Accounts Payable Due to Other Funds Deferred Revenue Total Liabilities FUND BALANCES Nonspendable Restricted: Debt Service Park Improvements Assigned: Capital Improvements Benefiting Individual Property Owners Unassigned Total Fund Balances Total Liabilities and Fund Balances See accompanying Notes to Basic Financial Statements. (5) G.O. G.O. Improvement Improvement General Bonds Bonds Fund Series 2004A Series 2006A $ 354,967 $ 106,423 $ 136,346 20,983 - - 1,050 191,002 80,570 14,486 - - 1,501 414 511 54,385 - - 1.186 - $ 448,558 $ 297,839 $ 217,427 $ 20,013 $ $ 31,144 190,958 80,108 51,157 190,958 80,108 1,186 106,881 137,319 396.215 - - 397, 401 106,881 137.319 $ 448,558 $ 297,839 $ 217,427 G.O. Capital 2011 Improvement Scheuneman Other Total Plan Bonds Road Governmental Governmental Series 2007A Fund Funds Funds $ 81,254 $ $ 133,302 $ 812,292 3,702 - 24,685 - 53,896 326,518 - - - 14,486 247 295 2,968 - - 54,385 1,186 $ 85,203 $ 53,896 $ 133,597 $ 1,236,520 - 54,385 4.222 53,896 4,222 108,281 80,981 $ $ 20,013 54,385 360,328 434,726 38,044 1,186 325,181 38,044 95,553 95,553 - (54,385) - 341,830 80,981 (54,385) 133,597 801,794 $ 85,203 $ 53,896 $ 133,597 $ 1,236,520 U) CITY OF GEM LAKE, MINNESOTA RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET ASSETS GOVERNMENTAL ACTIVITIES DECEMBER 31, 2011 TOTAL FUND BALANCES FOR GOVERNMENTAL FUNDS $ 801,794 Total net assets reported for governmental activities in the statement of net assets is different because: Capital assets used in governmental activities are not financial resources and, therefore, are no reported in the funds. These capital assets consist of: Buildings $ 902,232 Office Equipment 13,190 Infrastructure 712,788 Accumulated Depreciation (368.364) 1,259,846 Some of the City's property taxes and special assessments will be collected after year-end, but are not available soon enough to pay for the current period's expenditures and, therefore, are reported as deferred revenue in the governmental funds. 355,048 Bond issue costs are reported as expenditures in the governmental funds and are shown net of accumulated amortization on the statement of net assets. 26,394 Some liabilities are not due and payable in the current period and, therefore, are not reported as fund liabilities. Balances at year-end are General Obligation Bonds Payable (1,255,375) Unamortized Bond Discounts 13,693 Accrued Interest on Long -Term Debt (21,700) (1,263,382) TOTAL NET ASSETS OF GOVERNMENTAL ACTIVITIES $ 1,179,700 See accompanying Notes to Basic Financial Statements. (7) CITY OF GEM LAKE, MINNESOTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE GOVERNMENTALFUNDS YEAR ENDED DECEMBER 31, 2011 REVENUES Taxes Special Assessments Intergovernmental Licenses and Permits Fines and Forfeits Public Charges for Services Miscellaneous: Interest Other Total Revenues EXPENDITURES Current: General Government Public Safety Public Works Conservation and Development Capital Outlay Debt Service: Principal Interest and Fiscal Charges Total Expenditures EXCESS OF REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES) Transfers In Transfers Out Total Other Financing Sources (Uses) NET CHANGE IN FUND BALANCES Fund Balances - Beginning of Year FUND BALANCES - END OF YEAR See accompanying Notes to Basic Financial Statements. (8) G.O. G.O. Improvement Improvement General Bonds nnnA A Bonds 0--:-- nnnCA $ 244,765 $ - $ - - 44,525 28,849 4,471 - - 22, 927 - - 2,903 - - 10,278 - - 5,808 1,131 1,417 nn A O-7 J I0,JJ.7 `+J,VJV JV,GVV 89,442 - 100,675 - - 33,925 - 33,977 - 58,276 25,000 - 12,366 7,418 258,019 70,642 32.418 55,320 (24,986) (2,152) (70,000) (70, 000) - (14,680) (24,986) (2,152) 412,081 131,867 139,471 $ 397.401 $ 106,881 $ 137,319 G.O. Capital Improvement Scheuneman Plan Bonds Road 2011 Other Total Governmental Governmental $ 47,077 $ - $ $ 291,842 - 17,547 90,921 - 4,471 22,927 2,903 - - - 10,278 697 (907) 823 8,969 - - - 22,187 47,774 16,640 823 454,498 - - 89,442 100,675 33; 925 33,977 15,000 98,276 35,305 - - 55,089 50,305 - 411,384 (2,531) 16,640 823 43,114 70,000 70,000 - (70,000) - 70,000 - (2,531) 16,640 70,823 43,114 83,512 (71,025) 62,774 758,680 $ 80,981 $ (54,385) $ 133,597 $ 801,794 [a CITY OF GEM LAKE, MINNESOTA RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE TO THE STATEMENT OF ACTIVITIES GOVERNMENTAL ACTIVITIES YEAR ENDED DECEMBER 31, 2011 2011 NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FUNDS $ 43,114 Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures. However, in the statement of activities, assets are capitalized and the cost is allocated over their estimated useful lives and reported as depreciation expense. Capital Outlays $ 3,524 Depreciation Expense (62,439) (58,915) Delinquent and deferred property taxes and special assessments receivable will be collected subsequent to year-end, but are not available soon enough to pay for the current period's expenditures and, therefore, are deferred in the governmental funds. Deferred Revenue - December 31, 2010 410,283 Deferred Revenue - December 31, 2011 355,048 (55,235) The governmental funds report bond proceeds as financing sources, while repayment of bond principal is reported as an expenditure. In the statement of net assets, however, issuing debt increases long-term liabilities and does not affect the statement of activities and repayment of principal reduces the liability. Also, governmental funds report the effect of issuance costs, premiums and discounts when debt is first issued, whereas these amounts are deferred and amortized in the statement of activities. Interest is recognized as an expenditure in the governmental funds when it is due. In the statement of activities, however, interest expense is recognized as it accrues, regardless of when it is due. The net effect of these differences in the treatment of general obligation bonds and related items is as follows: Repayment of Bond Principal 98,276 Change in Accrued Interest Payable 1,596 Amortization of Bond Issue Costs (2,827) Amortization of Bond Discount (1.774) 95,271 CHANGE IN NET ASSETS OF GOVERNMENTAL ACTIVITIES $ 24,235 See accompanying Notes to Basic Financial Statements. (10) Cash and Cash Equivalents Customer Accounts Receivable Accrued Interest Receivable Special Assessments Receivable Prepaid Expenses Total Current Assets Capital Assets: Utility Plant in Service Accumulated Depreciation Net Capital Assets Total Assets Accounts Payable CITY OF GEM LAKE, MINNESOTA STATEMENT OF NET ASSETS PROPRIETARY FUND DECEMBER 31, 2011 ASSETS LIABILITIES NET ASSETS Invested in Capital Assets, Net of Related Debt Unrestricted Total Net Assets See accompanying Notes to Basic Financial Statements. (11) Sewer Utility $ 303,208 16,458 1,259 4,681 7,029 332,635 617,539 (86,973) 530.566 863,201 144 530,566 332,491 $ 863,057 CITY OF GEM LAKE, MINNESOTA STATEMENT OF REVENUES, EXPENSES AND CHANGE IN NET ASSETS PROPRIETARY FUND YEAR ENDED DECEMBER 31, 2011 OPERATING REVENUES Public Charges for Services OPERATING EXPENSES Operating Expenses Depreciation Total Operating Expenses OPERATING INCOME NONOPERATING REVENUES Interest Revenue CHANGE IN NET ASSETS Net Assets - Beginning of Year NET ASSETS - END OF YEAR See accompanying Notes to Basic Financial Statements (12) Sewer Utility $ 49,783 23,263 12,456 35,719 14,064 3,658 17,722 845,335 $ 863,057 CITY OF GEM LAKE, MINNESOTA STATEMENT OF CASH FLOWS PROPRIETARY FUND YEAR ENDED DECEMBER 31, 2011 CASH FLOWS FROM OPERATING ACTIVITIES Cash Received from Utility Customers Cash Payments to Suppliers for Goods and Services Net Cash Provided by Operating Activities CASH FLOWS FROM INVESTING ACTIVITIES Interest on Investments NET INCREASE IN CASH AND CASH EQUIVALENTS Cash and Cash Equivalents - Beginning of Year CASH AND CASH EQUIVALENTS - END OF YEAR RECONCILIATION OF OPERATING INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES Operating Income Adjustments to Reconcile Operating Income to Net Cash Provided by Operating Activities: Depreciation Changes in Assets and Liabilities: Customer Accounts Receivable Special Assessments Receivable Prepaid Expenses Accounts Payable Net Cash Provided by Operating Activities See accompanying Notes to Basic Financial Statements. (13) Sewer Utilitv $ 47,634 (25, 061) 22,573 3,809 26,382 276,826 $ 303,208 $ 14,064 12,456 (2,625) 476 278 (2,076) $ 22,573 CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The financial statements of the City have been prepared in conformity with U.S. generally accepted accounting principles as applied to governmental units by the Governmental Accounting Standards Board (GASB). The following is a summary of the significant accounting policies. A. Financial Reporting Entity As required by U.S. generally accepted accounting principles, the financial statements of the reporting entity include those of the City of Gem Lake and its component units. A component unit is a legally separate entity for which the primary government is financially accountable, or for which the exclusion of the component unit would render the financial statements of the primary government misleading. The criteria used to determine if the primary government is financially accountable for a component include whether or not the primary government appoints the voting majority of the potential component unit's board, is able to impose its will on the potential component unit, is in a relationship of financial benefit or burden with the potential component unit, or is fiscally depended upon by the potential component unit. Based on these criteria, there are no organizations considered to be component units of the City. B. Basic Financial Statements 1. Government -Wide Statements The government -wide financial statements (i.e., the statement of net assets and the statement of activities) display information about the primary government and its component units. These statements include the financial activities of the overall City government. Eliminations have been made to minimize the double -counting of internal activities. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business -type activities, which rely to a significant extent on fees and charges to external parties for support. In the government -wide statement of net assets, both the governmental and business -type activities columns: (a) are presented on a consolidated basis by column; and (b) are reported on a full accrual, economic resource basis, which recognizes all long-term assets and receivables as well as long-term debt and obligations. The City's net assets are reported in three parts: (1) invested in capital assets, net of related debt; (2) restricted net assets; and (3) unrestricted net assets. The City first utilizes restricted resources to finance qualifying activities. CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) B. Basic Financial Statements (Continued) 1. Government -Wide Statements (Continued) The statement of activities demonstrates the degree to which the direct expenses of each function of the City's governmental activities and different business -type activity are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or activity. Program revenues include: (1) fees, fines, and charges paid by the recipients of goods, services, or privileges provided by a given function or activity; and (2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or activity. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. 2. Fund Financial Statements The fund financial statements provide information about the City's funds. Separate statements for each fund category, governmental and proprietary, are presented. The emphasis of governmental and proprietary fund financial statements is on major individual governmental and enterprise funds, with each displayed as separate columns in the fund financial statements. All remaining governmental and enterprise funds are aggregated and reported as nonmajor funds. The City reports the following major governmental funds: General Fund — The General Fund is the City's primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. G.O. Improvement Bonds Series 2004A — The G.O. Improvement Bonds Series 2004A Fund accounts for all debt service activity related to the 2004A bond. G.O. Improvement Bonds Series 2006A — The G.O. Improvement Bonds Series 2006A Fund accounts for all debt service activity related to the 2006A bond. G.O. Capital Improvements Plan Bonds Series 2007A — The G.O. Capital Improvement Plan Bonds Series 2007A Fund accounts for all debt service activity related to the 2007A bond. Scheuneman Road Fund — The Scheuneman Road Construction Fund accounts for all activity related to the reconstruction of the Southern portion of Scheuneman Road which was turned back to the City from Ramsey County in 2006. (15) CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) B. Basic Financial Statements (Continued) 2. Fund Financial Statements (Continued) The City reports the following major proprietary fund: Sewer Fund — The sewer fund accounts for customer sewer service charges that are used to finance sewer operating expenses. C. Measurement Focus and Basis of Accounting The government -wide and proprietary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned, and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Private -sector standards of accounting and financial reporting issued on or before November 30, 1989, generally are followed in both the government -wide and proprietary fund financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following subsequent private -sector guidance for their business - type activities and enterprise funds, subject to this same limitation. The City has elected not to follow subsequent private -sector guidance. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. The City considers all revenues to be available if they are collected within 60 days after the end of the current period. Property and other taxes, licenses, and interest are all considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt, compensated absences, and claims and judgments, which are recognized as expenditures to the extent that they have matured. Proceeds of general long-term debt and acquisitions under capital leases are reported as other financing sources. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenue of the City's enterprise funds are charges to customers for sales and services. Operating expenses for enterprise funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Budgets Budgets are adopted on a basis consistent with U.S. generally accepted accounting principles. An annual appropriated budget is adopted for the General Fund. Budgeted expenditure appropriations lapse at year-end. E. Cash and Investments Cash and investment balances from all funds are pooled and invested to the extent available in investments authorized by Minnesota Statutes. Earnings from investments are allocated to individual funds on the basis of the fund's equity in the cash and investment pool. The City provides temporary advances to funds that have insufficient cash balances by means of an advance from another fund shown as interfund receivables in the advancing fund in the governmental fund financial statements, and an interfund payable in the fund with the deficit, until adequate resources are received. These interfund payables are eliminated for statement of net assets presentation. Investments are stated at fair value as of the balance sheet date. Interest earnings are accrued at the balance sheet date. For purposes of the statement of cash flows the Proprietary Fund considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. All of the cash and investments allocated to the proprietary fund types have original maturities of 90 days or less. Therefore, the entire balance in such fund types is considered cash equivalents. F. Prepaid Expenses Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepayments. Prepaid items are reported using the consumption method and recorded as an expense or expenditure at the time of consumption. That portion of the relevant funds' balances equal to material prepaid items has been reserved. G. Property Tax Credits Property taxes on homestead property (as defined by state statutes) are partially reduced by property tax credits. These credits are paid to the City by the state in lieu of taxes levied against homestead property. The state remits these credits through installments each year. These credits are recognized as revenue by the City at the time of collection. CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) H. Property Tax Revenue Recognition The City Council annually adopts a tax levy and certifies it to the County in December (levy/assessment date) of each year for collection in the following year. The County is responsible for billing and collecting all property taxes for itself, the City, the local School District and other taxing authorities. Such taxes become a lien on January 1 and are recorded as receivables by the City at that date. Real property taxes are payable (by property owners) on May 15 and October 15 of each calendar year. Personal property taxes are payable by taxpayers on February 28 and June 30 of each year. These taxes are collected by the County and remitted to the City on or before July 15 and December 15 of the same year. Delinquent collections for November and December are received the following January. The City has no ability to enforce payment of property taxes by property owners. The County possesses this authority. Within the governmental fund financial statements, the City recognizes property tax revenue when it becomes both measurable and available to finance expenditures of the current period. In practice, current and delinquent taxes and State credits received by the City in July, December and the following January are recognized as revenue for the current year. Taxes and credits not received at the year-end are classified as delinquent and due from County taxes receivable. The portion of delinquent taxes not collected by the City in January is fully offset by deferred revenue because it is not available to finance current expenditures. Deferred revenue in governmental activities is susceptible to full accrual on the government -wide statements. The City's property tax revenue includes payments from the Metropolitan Revenue Distribution (Fiscal Disparities Formula) per Minnesota Statute 473F. This statute provides a means of spreading a portion of the taxable valuation of commercial/industrial real property to various taxing authorities within the defined metropolitan area. The valuation "shared" is a portion of commercial/industrial property valuation growth since 1971. Property taxes paid to the City through this formula for 2011 totaled $3,199. Receipt of property taxes from this "fiscal disparities pool" does not increase or decrease total tax revenue. I. Special Assessment Revenue Recognition Special assessments are levied against benefited properties for the cost or a portion of the cost of special assessment improvement projects in accordance with state statutes. These assessments are collectible by the City over a term of years usually consistent with the term of the related bond issue. Collection of annual installments (including interest) is handled by the County Auditor in the same manner as property taxes. Property owners are allowed to (and often do) prepay future installments without interest or prepayment penalties. CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Special Assessment Revenue Recognition (Continued) Within the fund financial statements, the revenue from special assessments is recognized by the City when it becomes measurable and available to finance expenditures of the current fiscal period. In practice, current and delinquent special assessments received by the City are recognized as revenue for the current year. Special assessments are collected by the County and remitted by December 31 (remitted to the City the following January) and are also recognized as revenue for the current year. All remaining delinquent, deferred and special deferred assessments receivable in governmental funding are completely offset by deferred revenues. Deferred revenue in governmental activities is susceptible to full accrual on the government -wide statements. Once a special assessment roll is adopted, the amount attributed to each parcel is a lien upon that property until full payment is made or the amount is determined to be excessive by the City's City Council or court action. If special assessments are allowed to go delinquent, the property is subject to tax forfeit sale and the first proceeds of that sale (after costs, penalties and expenses of sale) are remitted to the City in payment of delinquent special assessments. Generally, the City will collect the full amount of its special assessments not adjusted by the City's City Council or court action. Pursuant to State Statutes, a property shall be subject to a tax forfeit sale after three years unless it is homesteaded, agricultural or seasonal recreational land in which event the property is subject to such sale after five years. J. Capital Assets Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, sidewalks, street lights, and similar items) are reported in the applicable governmental or business -type activities columns in the government -wide financial statements. Capital assets are recorded at historical cost or estimated historical cost if purchased or constructed. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed. The government reports infrastructure assets on a network and subsystem basis. In the case of the initial capitalization of general infrastructure assets (i.e., those reported by governmental activities) the City chose to include all such items regardless of their acquisition date or amount. NOTE 1 CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) J. Capital Assets (Continued) Depreciation on exhaustible assets is recorded as an allocated expense in the statement of activities with accumulated depreciation reflected in the statement of net assets. Since surplus assets are sold for an immaterial amount when declared as no longer needed for City purposes, no salvage value is taken into consideration for depreciation purposes. Capital assets not being depreciated include construction in progress. Depreciation Estimated Assets Method Useful Life Buildings Straight -Line 40 Years Office Equipment Straight -Line 5 - 10 Years Utility Systems Straight -Line 20 - 50 Years Infrastructure Straight -Line 20 - 50 Years K. Long -Term Obligations In the entity -wide financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable. governmental activities. Bond premiums and discounts are deferred and amortized over the life of the bonds using the straight-line method. Bond issue costs, if material, are reported as prepaid items and amortized over the term of the related debt using the straight-line method. In the governmental fund financial statements, bond premiums and discounts, as well as bond issue costs are recognized during the current period. The face amount of the debt issue is reported as on other financing source. Premiums received on debt issuances are reported as other financing sources while discounts are reported as other financing uses. Issue costs are reported as debt service expenditures. (20) CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) L. Net Assets/Fund Balance Net assets represent the difference between assets and liabilities in the government - wide and proprietary fund financial statements. Net assets invested in capital assets, net of related debt, consists of capital assets, net of accumulated depreciation, reduced by the outstanding balance of any long-term debt used to build or acquire the capital assets. Net assets are reported as restricted when there are limitations imposed on their use through external restrictions imposed by creditors, grantors, or laws or regulations of other governments. At December 31, 2011, the City adopted GASB Statement No.54, Fund Balance Reporting and Governmental Fund Type Definitions. In the fund financial statements, governmental funds report fund balances in the classifications that disclose constraints for which amounts in those funds can be spent. These classifications are as follows: Nonspendable — portion of fund balances related to prepaids, inventories, long-term receivables, and corpus on any permanent fund. Restricted — funds are constrained from outside parties (statute, grantors, bond agreements, etc.). Committed — funds are established and modified by a resolution approved by the City Council. Assigned — consists of internally imposed constraints approved by the City Finance Director. Unassigned — is the residual classification for the General Fund and also reflects the negative residual amounts in other funds. When an expenditure is incurred for purposes for which both restricted and unrestricted fund balance is available, it is the City's policy to use restricted first, then unrestricted fund balance. When an expenditure is incurred for purposes for which committed, assigned and unassigned amounts are available, it is the City's policy to use committed first, then assigned, and finally unassigned amounts. (21) CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) M. Interfund Transactions Interfund services provided and used are accounted for as revenues, expenditures or expenses. Transactions that constitute reimbursements to a fund for expenditures/ expenses initially made from it that are properly applicable to another fund, are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures or expenses in the fund that is reimbursed. All other interfund transactions are reported as transfers. All interfund transactions are eliminated except for activity between governmental activities and business -type activities for presentation in the entity -wide statements of net assets and statements of activities. NOTE 2 DEPOSITS AND INVESTMENTS A. Deposits The City maintains a cash and investment pool- that is available for use by all funds. Each fund type's portion of this pool is displayed on the statement of net assets and the balance sheet as "Cash and Investments." In accordance with Minnesota Statutes, the City maintains deposits at financial institutions which are authorized by the City Council. Custodial Credit Risk — Custodial credit risk for deposits is the risk that in the event of a bank failure, the City's deposits may not be returned to it. The City does not have a deposit policy for custodial credit risk and follows Minnesota Statutes for deposits. Minnesota Statutes require that all deposits be protected by insurance, surety bond, or collateral. The market value of collateral pledged must equal 110% of the deposits not covered by insurance or corporate surety bonds. Authorized collateral include: U.S. government treasury bills, notes, or bonds; issues of a U.S. government agency; general obligations of a state or local government rated "A" or better; revenue obligations of a state or local government rated "AA" or better; irrevocable standby letter of credit issued by a Federal Home Loan Bank; and time deposits insured by a federal agency. Minnesota Statutes require securities pledged as collateral be held in safekeeping in a restricted account at the Federal Reserve Bank or in an account at a trust department of a commercial bank or other financial institution not owned or controlled by the depository. The carrying value and bank balance of the City's deposits in banks at December 31, 2011 were $562,220 and $565,038, respectively, and were entirely covered by federal depository insurance or by surety bonds and collateral in accordance with Minnesota Statutes. (22) CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 2 DEPOSITS AND INVESTMENTS (CONTINUED) B. Investments The City may also invest idle funds as authorized by Minnesota Statutes as follows • Direct obligations or obligations guaranteed by the United States or its agencies. • Shares of investment companies registered under the Federal Investment Company Act of 1940 and received the highest credit rating, are rated in one of the two highest rating categories by a statistical rating agency and all of the investments have a finial maturity of thirteen months or less. • General obligations rated "A" or better; revenue obligations rated "AA" or better. • General obligations of the Minnesota Housing Finance Agency rate "A" or better. • Bankers' acceptances of United States banks eligible for purchase by the Federal Reserve System. • Commercial paper issued by United States banks corporations or their Canadian subsidiaries, of highest quality category by a least two nationally recognized rating agencies, and maturing in 270 days or less. • Guaranteed investment contracts guaranteed by United States commercial banks or domestic branches of foreign banks or United States insurance companies if similar debt obligations of the issuer or the collateral pledged by the issuer is in the top two rating categories. • repurchase or reverse purchase agreement and securities lending agreements financial institutions qualified as a "depository" by the government entity, with banks that are members of the Federal Reserve System with capitalization exceeding $10,000,000, a -primary reporting dealer in U.S. government securities to the Federal Reserve Bank of New York, or certain Minnesota securities broker -dealers. Custodial Credit Risk For an investment, custodial credit risk is the risk that, in the event of failure of the counterparty, the City will not be able to recover the value of its investment or collateral securities that are in the possession of an outside party. The City's investment policy doesn't specifically address custodial credit risk. Interest Rate Risk Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. The City's investment policy doesn't specifically address interest rate risk. Information about the sensitivty of the fair values of the City's investments to market interest rate risk fluctuations is provided by the following table that shows the distribution of the City's investments by maturity: (23) CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 2 DEPOSITS AND INVESTMENTS (CONTINUED) B. Investments (Continued) Interest Rate Risk (Continued) 12 Months 13 to 24 25 to 60 More than Type Total or Less Months Months 60 Months Federal Farm Credit $ 200,000 $ $ $ 200,000 $ Build America Bonds - Shoreview 167,681 - 167,681 Federal Home Loan Bank 33,906 33,906 Wells Fargo Prime Investment Fund 151,693 151,693 Total $ 553,280 S 151,693 $ S 200,000 S 201.587 Credit Risk Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. The City's investment policy doesn't specifically address credit risk. The following chart summarizes year-end ratings for the City's investments as rated by Moody's Investors Services: Government Money Market Mutual Funds Federal Farm Credit Build America Bonds Federal Home Loan Bank Total Concentration of Credit Risk Credit Quality Rating Amount N/A $ 151,693 AAA 200,000 AAA 167,681 AAA 33.906 $ 553,280 The City places no limit on the amount that the City may invest in any one issuer. The following is a list of investments which individually comprise more than 5% of the City's total investments: Credit Type Quality Rating_ Government Money Market Mutual Funds N/A Federal Farm Credit AAA Build America Bonds - Shoreview AAA Federal Home Loan Bank AAA (24) Amount Percentage $ 151,693 27.42% 200,000 36.15% 167,681 30.31 % 33,906 6.13% CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 3 CAPITAL ASSETS Capital asset activity for the year ended December 31, 2011 was as follows. Beginning Ending Balance Increases Decreases Balance Governmental Activities: Capital Assets Being Depreciated: Buildings Office Equipment Infrastructure Total Capital Assets Being Depreciated Accumulated Depreciation: Buildings Office Equipment Infrastructure Total Accumulated Depreciation Net Capital Assets - Capital Activities $ 898,708 $ 3,524 $ $ 902,232 13,190 - 13.190 712,788 712,788 1,624,686 3,524 1,628,210 (64,595) (22,497) - (87,092) (4,508) (1,506) - (6,014) (236,822) (38,436) - (275,258) (305,925) (62,439) - (368,364) $ 1,318,761 $ (58,915) $ $ 1,259,846 Depreciation expense was charged to the governmental functions as follows: General Government Public Works Total Depreciation - Governmental Activities Sewer Utility Capital Assets Being Depreciated: Infrastructure Less: Accumulated Depreciation Net Capital Assets - Sewer Utility $ 24,003 Beginning Balance Increases Decreases Ending Balance $ 617,539 $ - $ $ 617,539 (74,517) (12,456) (86,973) $ 543,022 $ (12,456) $ $ 530,566 (25) CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 4 CITY INDEBTEDNESS City indebtedness at December 31, 2011 is composed of the following: Final Issue Maturity Interest Original Balance Date Date Rate Issue 12/31/11 Governmental Activities: General Obligation Bonds: 2004A Improvement Bonds 11/03/2004 02/01/2016 3.70% $ 586.000 $ 290,375 2006A Improvement Bonds 08/23/2006 02/01/2017 4.30% 245.000 160,000 2007A Capital Improvement Bonds 06/20/2007 02/01/2028 4.00-4.50% 850,000 805,000 Total Long -Term Debt 1,681,000 1,255,375 Unamortized Bond Discount i25.111) (13,693) Total 5 1.655,889 $ 1,241,682 The following is a schedule of changes in City indebtedness for the year ended December 31, 2011: Balance Balance Due Within 12/31/10 Additions Reductions 12/31/11 One Year Long -Term Debt Governmental Activities General Obligation Bonds $ 1,353,651 $ $ 98,276 $ 1,255,375 $ 100,452 Unamortized Bond Discount (15,467) (1,774) (13.693) - Total Long -Term Debt $ 1.338.184 $ $ 96,502 S 1.241.682 $ 100. 552 All long-term bonded indebtedness outstanding at December 31, 2011 is backed by the full faith and credit of the City, including_ special assessment bond issues. For the governmental activities, compensated absences are generally liquidated by the general fund. Minimum annual principal and interest payments required to retire long-term debt are as follows: Year Ending December 31, Principal Interest Total 2012 $ 100,452 $ 50,688 $ 151,140 2013 102,710 46,755 149,465 2014 105,052 42,738 147,790 2015 107,481 38,634 146,115 2016 79,680 34,331 114,011 2017-2021 295,000 131,221 426,221 2022-2026 320,000 68,754 388,754 2027-2028 145,000 6,637 151,637 Total $ 1,255,375 $ 419,758 $ 1,675,133 (26) CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 4 CITY INDEBTEDNESS (CONTINUED) Description and Restrictions of Long -Term Debt General Obligation Bonds — The bonds were issued for improvements or projects which benefited the City as a whole and are, therefore, repaid from ad valorem levies. NOTE 5 STEWARDSHIP COMPLIANCE AND ACCOUNTABILITY Deficit Fund Balances The City has deficit fund balances at December 31, 2011 as follows Scheuneman Road Fund Fund Balance npfirit -1) k04,300) The City intends to fund these deficits through future tax levies, transfers from other funds, and various other sources. NOTE 6 INTERFUND RECEIVABLE AND PAYABLE Individual fund receivable and payable balances at December 31, 2011 are as follows Governmental Activity: General Fund Capital Projects Fund - Scheuneman Road Interfund Interfund Receivable Payable $ 54,385 $ $ 54,385 54 385 S 54,385 Interfund receivable and payable balances represent the elimination of negative cash between funds. NOTE 7 RISK MANAGEMENT The City is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions; injuries to employees; and natural disasters. The City carries commercial insurance for all risks of loss, including disability and employee health insurance. There were no significant reductions in insurance from the previous year or settlements in excess of insurance coverage for any of the past three fiscal years. (27) CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 8 FUND BALANCES Certain portions of fund balance are restricted to provide for funding on certain long-term liabilities or as required by other outside parties. Restricted, Committed and Assigned fund balances at December 31, 2011, are as follows: A. Restricted for Debt Service — This represents amounts which are restricted for future debt payments. B. Restricted for Park Improvements — Represents amounts which are received through park dedication fees and are restricted for park acquisitions and improvements. C. Assigned for Capital Improvements Benefitting Individual Property Owners — Represents amounts which are assigned by the City to finance future road improvement projects benefitting individual property owners. (28) REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON INFORMATION CITY OF GEM LAKE, MINNESOTA SCHEDULE OF REVENUES, EXPENDITURES AND CHANGE IN FUND BALANCE BUDGET AND ACTUAL GENERAL FUND YEAR ENDED DECEMBER 31, 2011 REVENUES Taxes Intergovernmental Licenses and Permits Fines and Forfeits Public Charges for Services Miscellaneous: Interest Other Total Revenues EXPENDITURES General Government Public Safety Public Works Conservation and Development Total Expenditures EXCESS OF REVENUE OVER (UNDER) EXPENDITURES OTHER FINANCING USES Transfers Out NET CHANGE IN FUND BALANCE Fund Balance - Beginning of Year FUND BALANCE - END OF YEAR Budgeted Amounts Actual Variance with Original Final Amounts Final Budaet $ 268,234 $ 268,234 $ 244,765 $ (23,469) 6,796 6,796 4,471 (2,325) 12,980 12,980 22,927 9,947 1,700 1,700 2,903 1,203 4,000 4,000 10,278 6,278 4,000 4,000 5,808 1,808 28,446 28,446 22,187 (6,259) 326,156 326,156 313,339 (12,817) 168,915 168,915 89,442 79,473 101,537 101,537 100,675 862 77,803 77,803 33,925 43,878 38,500 38,500 33,977 4,523 386,755 386,755 258,019 128,736 (60,599) (60,599) 55,320 115,919 (25.000) (25,000) (70,000) (45,000) $ (85,599) $ (85,599) (14,680) S 70.919 412,081 $ 397,401 See accompanying Note to Required Supplementary Information. (29) CITY OF GEM LAKE, MINNESOTA NOTE TO REQUIRED SUPPLEMENTARY INFORMATION DECEMBER 31, 2011 STEWARDSHIP COMPLIANCE AND ACCOUNTABILITY - BUDGET The General Fund budget is legally adopted on a basis consistent with U.S. generally accepted accounting principles. Actual expenditures did not exceed budgets during 2011. (30) COMBINING FUND FINANCIAL STATEMENTS CITY OF GEM LAKE, MINNESOTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS DECEMBER 31, 2011 ASSETS Cash and Investments Accrued Interest Receivable Total Assets FUND BALANCES Restricted: Park Improvements Assigned: Capital Improvements Benefiting Individual Property Owners Total Fund Balance Total Liabilities and Fund Balances Special Capital Revenue Projects Parks and Street Hoffman Total Playground Improvements Road Nonmajor Fund Fund Fund Funds $ 37,880 $ 70,014 $ 25,408 $ 133,302 164 23 108 295 $ 38,044 $ 70,037 $ 25,516 $ 133,597 $ 38,044 $ - $ - $ 38,044 70,037 25,516 951553 38,044 70,037 25,516 133.597 $ 38,044 $ 70,037 $ 25,516 $ 133,597 (31) CITY OF GEM LAKE, MINNESOTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGE IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED DECEMBER 31, 2011 Special Capital Revenue Projects Parks and Street Hoffman Total Playground Improvements Road Nonmajor Fund Fund Fund Funds REVENUES Interest $ 473 $ 37 $ 313 $ 823 OTHER FINANCING SOURCES Transfers In - 70,000 - 70,000 NET CHANGE IN FUND BALANCES 473 70,037 313 70,823 Fund Balance - Beginning of Year 37,571 - 25,203 62,774 FUND BALANCE - END OF YEAR $ 38,044 $ 70,037 $ 25,516 $ 133,597 (32) OTHER REQUIRED REPORTS Clifton Larson Allen offir CliftonLarsonAllen LLP wmv cliftonlarsonallen com REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Honorable Mayor and Members of the City Council City of Gem Lake, Minnesota In planning and performing our audit of the financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of City of Gem Lake as of and for the year ended December 31, 2011, in accordance with auditing standards generally accepted in the United States of America, we considered City of Gem Lake's internal control over financial reporting (internal control) as a basis for designing our auditing procedures for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly, we do not express an opinion on the effectiveness of the City's internal control. Our consideration of internal control was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in °internal control that might be significant deficiencies or material weaknesses and, therefore, there_ can be no assurance that all such deficiencies have been identified. However, as discussed below, we identified certain deficiencies in internal control that we consider to be material weaknesses. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the City's financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of the internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over financial reporting that might be deficiencies, significant deficiencies, or material weaknesses. However, as described in the accompanying Schedule of Findings and Responses, we identified deficiencies in internal control that we consider to be material weaknesses. (33) Honorable Mayor and Members of the City Council City of Gem Lake As part of obtaining reasonable assurance about whether the City's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. The City's responses to the findings identified in our audit are described in the accompanying schedule of findings and responses. We did not audit the City's responses and, accordingly, we express no opinion on them. This report is intended solely for the information and use of the City Council, management, the Office of the State Auditor, and state and federal awarding agencies and is not intended to be and should not be used by anyone other than these specified parties. Minneapolis, Minnesota June 14, 2012 (34) CliftonLarsonAllen LLP CliftonLarsonAllen op, CliftonLarsonAllen LLP www.cliftonlarsonallen.com REPORT ON MINNESOTA LEGAL COMPLIANCE Honorable Mayor, Members of the City Council, and Citizens City of Gem Lake, Minnesota We have audited the financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of Gem Lake, Minnesota, which collectively comprise the City's basic financial statements as of and for the year ended December 31, 2011, and have issued our report thereon dated June 14, 2012. We conducted our audit in accordance with U.S. generally accepted auditing standards and the provisions of the Minnesota Legal Compliance Audit Guide for Political Subdivisions, promulgated by the State Auditor pursuant to Minnesota Statutes §6.65. Accordingly, the audit included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. The Minnesota Legal Compliance Audit Guide for Political Subdivisions covers seven main categories of compliance to be tested: contracting and bidding, deposits and investments, conflicts of interest, public indebtedness, claims and disbursements, miscellaneous city provisions, and tax increment financing districts. Our study included all of the listed categories except for tax increment financing districts because the City has no tax increment financing districts. The results of our tests indicate that, with respect to the items tested, the City of Gem Lake, Minnesota complied with the material terms and conditions of applicable legal provisions. This report is intended solely for the information and use of management, the City Council, the Office of the State Auditor, and other state agencies, and is not intended to be and should not be used by anyone other than these specified parties. Minneapolis, Minnesota June 14, 2012 (35) CliftonLarsonAllen LLP CITY OF GEM LAKE SCHEDULE OF FINDINGS AND RESPONSES YEAR ENDED DECEMBER 31, 2011 2011-1 Oversight of the Financial Reporting Process Condition: The City does not have a system of internal controls that would enable management to conclude the financial statements and related disclosures are complete and presented in accordance with U.S. generally accepted accounting principles (GAAP). As such, management requested us to prepare a draft of the financial statements, including the related footnote disclosures. Criteria: The City should have controls in place to conclude the financial statements and related disclosures are complete and presented in accordance with GAAP. Effect: The City is unable to conclude on the accuracy of the financial statements. Cause: The City relies on the audit firm to prepare the annual financial statements and related footnote disclosures. However, they have reviewed and approved the annual financial statements and related footnote disclosures. Recommendation: We recommend that the City continue to evaluate its internal control processes to determine if additional internal control procedures should be implemented to ensure that the financial statements are complete and presented in accordance with U.S. GAAP. Management Response: Management has decided, due to the small size of the City's staff, that the additional costs of implementing the necessary controls outweigh the benefits that would be derived. (36) CITY OF GEM LAKE SCHEDULE OF FINDINGS AND RESPONSES YEAR ENDED DECEMBER 31, 2011 2011-2: Limited Segregation of Duties Condition: Due to the small size of the City's staff, there is by definition a lack of segregation of the accounting functions that is necessary to ensure adequate internal accounting control. While we realize this scenario is common for small entities, we are required to report this issue and to advise that a concentration of duties and responsibilities in a limited number of individuals is not desirable from an internal control perspective. Criteria: Generally, a system of internal control contemplates separation of duties such that no individual has responsibility to execute a transaction, have physical access to the related assets, and have responsibility or authority to record the transaction. Effect: The City is unable to maintain segregation of incompatible duties. Cause: The condition is due to a limited number of personnel involved in receipt and disbursement processes. Recommendation: Controls should be reviewed periodically and consideration given to improving the segregation of duties. In making this review, it is important to consider the benefit derived as weighed against the cost of the improvements. Management Response: Management has decided, due to the small size of the City's staff, that the additional costs of implementing the necessary controls outweigh the benefits that would be derived. (37) Claims For Payment CITY OF GEM LAKE Period Ending: 6/19/2012 Signatures Approving Claims I Date of Approvals Robert Uzpen, Mayor Jim Lindner, Council Gretchen Artig-Swomley, Council Tom Rasmussen, Council Rick Bosak, Council Fund Totals 1 1 $ Amount General Fund 23,936.52 Parks & Playgrounds 0.00 2004 Debt Service Fund 0.00 2006 Debt Service Fund 0.00 2007 Debt Service Fund 000 City Hall Construction Fund 0.00 Scheuneman Road Improvements O.DO Hoffman Road Improvements 000 Sewer Fund 1,208.91 Investment Trust Fund 0.00 Total All Funds 25,145.43 Included above are the pre -paid checks paid on May 31, 2012 6114112 at 13:09:25.87 Page: 1 City of Gem Lake Check Register - Prepaid Checks For the Period From May 31, 2012 to May 31, 2012 Filter Criteria includes: Report order is by Check Number. Check # Date Payee Amount 8559 5131/12 Centuryl-ink 104.78 8560 5/31/12 Innovative Office Solutions, LLC 718.03 8561 5/31/12 Todd Kirchhammer 120.00 8562 5131/12 Julie Newkirk 150.00 8563 5/31/12 SEH 2,786.38 8564 5/31112 T.A. Schifsky & Sons, Inc. 650.00 Total 4,529.19 6/14112 at 13:10:26.21 Page: 1 City of Gem Lake Check Register For the Period From Jun 19, 2012 to Jun 19, 2012 Filter Criteria includes: Report order is by Check Number. Check # Date Payee Amount 8565 6/19112 Fed Ex Office 237.14 8666 6/19/12 Innovative Office Solutions, LLC 64.34 8567 6/19/12 Kelly & Lemmons, PA 1,500.00 8568 6/19/12 LarsonAllen LLP 5,250.00 8569 6/19/12 League of Minnesota Cities 105.00 8570 6/19/12 Julie Newkirk 150.00 8571 6/19/12 Robb Olson 250.00 8572 6/19/12 Press Publications 28.30 8573 6/19/12 Ramsey County 7,150.45 8574 6/19/12 SEH 776.41 8575 6/19/12 Xcel Energy 427.67 8576 6/19/12 Waste Management of WI -MN 847.67 8577 6/19/12 City of White Bear Lake 1,462.67 8578 6/19/12 White Bear Township 96.73 8579 6/19112 White Bear Township 1,166.95 8580 6/19/12 VOID 8581 6/19/12 Metropolitan Council 1.102.91 Total 20,616.24 c i cc IL I C M I� Cl) O O O Q O M M O O 'cY r d Cl) O O O O O O CD O 0 O O Cl) LO 0 Cp O O (O co O to M1 m V CO O O LO LO CD O LO O N 06 N O E I� ��- O N U) N Q r (V r LO M1 a d U c0 M O O co O O O O O O O O O LO C M1 O O O M O O 7 M Q O O O O C7 h M1 :3 0 d' OD 0 O CD O O r- Q O LO O O co M1 N E O I� N LO 000 � O LO CD M N 0 LO LO N O LO LO N N M N Cr Q T r LO N r G1 O ❑ N T- r O Z_ Y W cc CD F- Z O M N W M o J (o Z O J N LO U J Lo O O N J N LO W Z = LO w N N co cn N N N Q O O N W � C W O .� N O � U (D U N LL LL to O N � Z N p~ Z - C J (n O < f9 O Q LO Q (/J IC Oo OLO W vE JOC 2� �W V c W(n w Ja) Qc om Z Z zo UU d_ a � a� z_ (Eo U�c �O to O aF- w E J N•c ZY O V Z Z O D Y ¢ O 4 N � O N 0 w- � 3 U �T�" a W U O N t �Q W d t_0 y 'j ED T r Q v OJ W> W Y U SO o0 LLj (0 of Q C Y j N Z U m (n L uJ ❑ S U (O J Z U U (n N M U N 0-1 N (W J co O LI cn O ~ Q Q 0 LL O Q O N `> Co ❑ 2 7 N LL C c 2 N LL. cc 2 0 Q LO W ALL O C O 2Y O (p J �J > (D� O da� a.a- U a) J =U O =f C.)-7 AMU U � N N Z Y N O O O O N M N N O O O O N LO O O It O O LO O N M M O U') M1 LO 00 c) M N M M M M M N M M �-- M M M M M N L U ❑ 00 'tO 00 OO O O It O O O OO O O O O L f) O NO 0 0 OO 00 CD O O o 0 0 0 OO 00 OO O O O 0 0 OO C 7 O OO O O O OOO T C (P O m O 0) — O CD — O (A O M O O O O O M O LO O _ M O W 0 (D — 0 a) O N N O n 0 O T7 `77 'Td— d— �� — "T , I—. � i 17 , 'I'T7 () 00 00 00 00 Qo oO 0 Qo 000 coo 00 00 00 oQ 00 00 CjO 00 0) Q 00 C. 00 00 00 00 oQ 00 (Do 000 000 QoQ 0 0 a m M co _0 Y O 0) O (D (0 N (fl Cl) (D V' CD LO CO (D (0 n (0 co CD O (D O Cl) M1 M P c) c- CO CO LO LO LO 00 LO 00 LO 00 LO 00 LO 00 LO 00 LO 00 LO 00 LO 00 LO 00 LO 00 LO 00 _ C_ U co 00 co M m N N N N N N N N N N N N N N N N ( J = r (T O'1 (A CA C3) 0) CA r. ❑ LO U) LO LCl LO LO (D Cp (D (D (O (fl ((DD (D CD Lp LL d a c 3 O E Q Y_ L V c 7 O E Q N e- N O ❑ N _ C C ❑ O d O N C-m) -r- J N E C C d M d fn tC O ')_ E m V N O o U-0 ca O m a_ N •i CL ayi L (n ❑ LL o c C J a) E D z U r ❑ rn O v U U Q O O (1 Ul N V -2 t L) U C U y a� I M l% ((00 QD r o rn rn co rn O (o O N co LO N N7 corn ro M 000000000000Ul)00 - Cl) (fl MN ODr LLD r O O O O O O O O Ln 00 CO q 00 rn (O MN rnr OM (O NO M(D NM0MOO CD CO N I— 000LO W 'd' O) OON NON NM ---00 O M LO N r M NM N� r � N (M N � N N � Z O = M L r N c�+l co MLo DO (D M� M (n W N O Z O (n iI CO z co w C��_ W � W DO �(j jr-3 rU M r U Z C.0 co NZ �j Oz N }� J�O`�� LO d -J c!, N� w� m >w> Q OQM<M�-j LO CL �- �NM W O N �Z L 7 N NUW �.wJ�JIU�wwm�J (fin W of C z ~U?¢ O wOm (MDU) O 22a-ULn�Lr) z -Z-J (D O wU C� OT-N T UU co -W a) �F- ZU) Z JO�0- Z i-- U) c Z� �d� W (o CC7C�QC7U~ m�❑(nwWZ00 N o w�jcn -- (wcu Z�i Qm �ZZwz J��UzwQCD�� (D cc N °a �2 W W U W N W W O W❑❑U❑�OJCOOLL (nwOUCn(n•� O QLLI F-== O WD (o �� =r �a:W5)QUF Cr LOJUQQL 0 a� 2E(n cn==X Ww3� LLEmmwmm<Da-00m2i000> �� N "�cl) 'Td .-N LO OM(D NCO MMrnOOD O OD 0000 000 CO O�c-O'-ONNOO Q MN Cl) MMCl) Cl) Cl) MM M MMc?ChMC?C?NNC?M M O O N d O o O o 0 O o 0 O O o r s O O O O O O O o O o 0 0 0 O O O O N O O O O 0 0 0 It O O O O o 0 0 0 0 1tV 0 0 0 0 0 0 0 0 cc rn� �rnrnr rn(A NN ��rnv 0) In rn 0) 0) m rn 0)r O M O O_ N N O O N N N— V 0 0 0 O O 777 7 r od dodo dod odd o0 00000d00000000000 o 00 0 0 0000 000 O o O 00 0 0 0 0 0 0 O 0 0 0 0 0 0 O 0 O o O O O �.- —r r— -- --• r-- -- a---- - c -- — — —r — — —(D —(D .- — COO LO co r co rn 00 0o co co co OD co 00 N N N N N N (V N - rn rn rn rn rn rn rn (D CD 0 (D (O CO D coo O'l 0 Y. 7 'd r. 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