2022 Annual Comprehensive Financial Report

CITY OF SHAKOPEE

MANAGEMENT’S DISCUSSION AND ANALYSIS December 31, 2022

Long-Term Debt At the end of the current year, the City had total bonded debt outstanding of $45,920,000. The full amount is debt backed by the full faith and credit of the government.

Outstanding Debt General Obligation Bonds Expressed in Thousands

Governmental Activities

Business-Type Activities

Total

2022

2021

2022

2021

2022

2021

G.O. Bonds

$

45,920

$

37,395

$

-

$

-

$

45,920

$

37,395

REQUESTS FOR INFORMATION This financial report is designed to provide a general view of the City’s finances for all those with an interest in the City’s finances. Questions concerning any of the information provided in this report or requests for additional information should be addressed to the Finance Director, 485 Gorman St., Shakopee, Minnesota, 55379. The City's taxable market value is $7.2 billion for taxes payable 2023, which is an increase of $1.17 billion or 19.4 percent from the previous year. New construction accounted for $127 million of the increase in value. The City is currently experiencing the construction and development of several new industrial, commercial and residential sites. The City’s past years commercial and industrial growth has spurred the need for new housing. The City is seeing all types of housing, from single family to multi-family and senior housing filling this need. The diversified commercial and industrial base provides a strong base of jobs and tax base. The 2023 City property tax levy is increasing by $1,406,000 to $23,892,000. Despite the levy increase the tax rate will see a significant decrease as a result of new growth and increasing existing property market value. In December 2022, the unemployment rate in Shakopee was 2.2%, down from 2.3% from a year ago. This compares favorably to the state’s December unemployment rate of 3.2% and the national rate of 3.3%. The City’s total outstanding bonded debt increased by $8,525,000 during the current year. The City retired $1,475,000 in principal in 2022 and issued $5,910,000 General Obligation Tax Increment Bonds 2022A and $4,090,000 General Obligation Improvement Bonds 2022A to fund infrastructure improvements Minnesota Statutes limit the amount of general obligation (G.O.) debt a government entity may issue to a net figure of three percent of the taxable market value. The current legal debt margin for the City is $182.8 million, which is significantly in excess of the City’s outstanding G.O. debt. The City maintains an “AA+” debt rating from S&P Global Ratings. Additional information on the City’s long-term debt can be found in Note 7 on pages 69 to 70 of this report. ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS AND RATES

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