By Maya Betti, News Intern
Northfield’s financial picture is looking strong as it heads into 2025.
At the end of last year, the city’s general fund balance — the money set aside for day-to-day expenses — was about 57% of next year’s budget. That’s a bit higher than the city’s target range of 40 to 50%, giving them a comfortable cushion.
Tom Olinger, an auditor from the firm Abdo Financial, explained that this fund balance is important because the city receives most of its tax revenue and state aid in two large payments each year in a presentation given at the June 10 City Council meeting. The fund helps cover costs between those payments.
Last year, the city brought in over a million dollars more than expected, thanks to extra grants and building permits.
Spending was also slightly higher than planned, including costs related to flooding at city ball fields, but the city still ended up adding about $460,000 to the fund balance instead of using it.
“A couple of those variances, specifically with the revenues, is that there was some additional grant dollars that came in on top of some some building permits. And then, based on the projects, there was some additional engineering charges that came back into the general fund that exceeded the budget,” – Tom Olinger of Abdo Financial at the 6/10/2025 Northfield City Council Work Session
Finance Director Brenda Angelstad said some of the spending was planned — like using police aid money received late in 2023 over the next few years. She also mentioned the city was reimbursed this year by FEMA for flood repairs paid for last year, which helped keep the budget balanced.
On the debt side, the city has nearly $6.4 million in cash related to old bond projects and expects to collect another $1.5 million over time through special assessments. Once some final payments are made, a few bond funds will be closed out.
Over the next 10 years, debt payments will generally go down, but there will be a small rise around 2026 and 2027. That’s because new loans will be taken out to pay for construction projects and higher interest costs. The city is managing this well, making sure new debt replaces old debt to keep projects moving without financial problems, according to Olinger.
“The amount of bonds, certainly are probably increasing there, but the city is doing a nice job of when those debt, when the debt does drop off, that new debt comes on, and that really kind of keeps the infrastructure flowing. Is really a good pattern on where the city should be in, kind of kind of doing that,” – Tom Olinger of Abdo Financial at the 6/10/2025 Northfield City Council Work Session
As of now, Northfield is in a good financial position going into 2025, with a strong fund balance and management of debt to support upcoming city projects.
We will be covering other parts of the audit report in future newscasts.
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