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CITY OF ROSEVILLE, MINNESOTA MANAGEMENT’S DISCUSSION AND ANALYSIS For Year Ended December 31, 2016 FINANCIAL ANALYSIS OF THE GOVERNMENT’S FUNDS Governmental Funds The focus of the City of Roseville’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information i s u s e f u l i n a s s e s s i n g t h e C i t y o f Roseville’s financing requirements. In particular, unrestricted fund balance may serve as useful measure of a government’s net resources available for spending at the end of the fiscal year. At the end of the current fiscal year, the City of Roseville's governmental funds reported combined ending fund balances of $43,982,955. Approximately 61.1% of this total amount $26,876,384; constitutes unrestricted fund balance. The remainder of the fund balance is restricted to indicate that it is not available for new spending because it is legally restricted for; 1) various operating purposes - $4,097,180, 2) for tax increment financing activities - $6,586,003, 3) bond funded capital improvements - $2,902,068, 4) debt service - $2,693,499 and 5) housing and economic development - $827,821. The fund balances of governmental funds declined by $5,379,976 in 2016. The decline is due to the spend down of bond proceeds on capital improvement projects and a return of surplus tax increment financing funds. The Economic Increments Construction Fund accounts for the activities in the City’s Tax Increment Financing (TIF) Districts. The Fund’s balance decreased by $5,673,270. The decline is due to the one- time return of $2.8 million of surplus monies previously held in the City’s Economic Increments Fund for a decertified tax increment district. Also the City had $4.7 million of infrastructure improvements in it’s Twin Lakes Area. The Street Construction Fund decreased by $1,030,789 largely due a budgeted spend down of reserves for various capital improvement projects. The Revolving Improvements Fund decreased $851,308 due to capital spending of previously issued bond proceeds. Proprietary Funds The City of Roseville’s proprietary funds provide the same type of information found in the government- wide financial statements, but in more detail. The unrestricted net position in the respective proprietary funds is Sewer - $681,734; Water – $294,660; Golf - $103,111; Storm - $390,410 and Recycling - $123,679. Overall net position increased $1,618,011 reflecting positive cash flow from utility rates which were designated for future capital replacements. General Fund Budgetary Highlights The General Fund balance increased by $1,204,544 in 2016 which was primarily due to the release of $1.1 million of excess tax increment by the county from the decertification of tax increment district No. 13. 22 Item 8: Attachment D