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Fund Structure
Fund Structure
The City of Leavenworth has established several funds that are organized in accordance with generally accepted accounting principles (GAAP) for reporting purposes. The activities of each fund are accounted for by providing a separate self-balancing set of accounts that includes assets, liabilities, fund balance, revenues, and expenditures. The City has the following types of budgeted funds:
General Fund: The general fund is the main operating fund of the city, which accounts for all financial resources not accounted for or reported in another fund. The majority of the City’s current operations are financed by the general fund.
Special Revenue Funds
These funds account for revenues derived from specific sources that are designated for particular functions or activities. The City budgets the following special revenue funds:
Recreation Fund: This fund is used to account for cultural and recreational activities of the City. Its resources are generated from ad valorem property taxes, sales taxes, and user fees.
Economic Development Fund: This fund is used to account for the City’s economic development activities. Its resources are generated from a 15% allocation of the County Wide sales tax.
Special Highway Fund: This fund accounts for the activities of the street department and derives its revenues mostly from a state fuel tax.
CIP Sales Tax Fund: This fund accounts for the activities related to the ½-cent permanent sales tax dedicated for capital improvements.
County Wide Sales Tax Fund: This fund accounts for the receipt and disbursement of sales tax revenues resulting from a one-cent County Wide sales tax enacted by Leavenworth County.
Convention & Visitors Bureau: This fund accounts for the activities of the tourism department. Revenues consist of transient guest taxes for the promotion of tourism and conventions.
Probation Services Fund: This fund accounts for the Probation Department. Resources are generated from 1/3 of the state liquor tax allocation and user fees.
Business & Technology: This fund accounts for the activities of maintaining the Business & Technology Park.
Community Grant Program: This fund accounts for the activities associated with the mitigation of COVID-19 in the community.
Debt Service Funds
The debt service fund is used to account for the receipt of revenues and disbursement of principal and interest on the outstanding debt. Resources come from property taxes and transfers from other funds related to specific projects.
Enterprise Funds:
These funds are used to account for operations that are financed and operated in a manner similar to private business enterprises. Budgeted enterprise funds include:
- Sewer Fund: This fund accounts for all activities necessary to provide sewer services to the citizens.
- Refuse Fund: The refuse fund accounts for activities necessary to provide refuse collection and disposal services to the citizens.
- Storm Water Fund: This fund accounts for the activities related to the impact fee dedicated for storm water capital improvements.
Fiduciary Funds
These funds are collected and held on behalf of others and are not available for use in support of the City’s activities. The City budgets the following types of fiduciary funds:
Pension funds: These funds are used to report resources that are held in trust for members and their dependents related to pensions. The City provided and administered a single-employer defined pension plan for police officers and firefighters. The plan was established by ordinance in 1945. In 1971, the City affiliated with the Kansas Police and Firemen’s Retirement System (KP&F). At that time, the plan became closed to new entrants. All members were given the option of joining KP&F or remaining with the City Plan. The General Fund absorbs all administrative costs. As of June 30, 2020, the plan consists of four (4) beneficiaries. The City budgets for the following Pension Plans:
- Fire Pension: This fund accounts for the activities related to the payment of pension benefits to retired firefighters and/or their dependents. Revenue supporting this activity comes from ad valorem property taxes.
- Police Pension: This fund accounts for the activities related to the payment of pension benefits to retired police officers and/or their dependents. Revenue supporting this activity comes from ad valorem property taxes.
Agency funds
This type of fiduciary fund accounts for resources held by the City in a custodial capacity, on behalf of its component unit, the Leavenworth Public Library and the various TIF districts. The City budgets for the following Agency funds:
- Leavenworth Public Library: This fund accounts for the levying, collecting, and disbursement of ad valorem property taxes in support of the library activities. Current City Ordinance limits the mill to 3.75 for the Library general operations.
- Library Employee Benefit Fund: This fund accounts for the levying, collecting and disbursement of ad valorem property taxes related to the payment of employee benefits such as Kansas Public Employee Retirement System (KPERS), health insurance and other employee benefits in support of the Leavenworth Public Library employees. There are no constraints upon levying the necessary millage to support the library employee benefits.
- Tax Increment Fund-Auto Incentives: This fund accounts for the transactions related to automotive sales economic development incentives. Revenues come from a portion of the City sales tax, CID’s, and property tax abatements on the improvements above the base year valuations.
- Tax Increment Fund-Hotels Incentives: This fund accounts for the transactions related to Hotel economic development incentives. Revenues come from property tax abatements on the improvements above the base year and in late 2017, a CID established specifically for the First City Hotel.
- Tax Increment Fund - Retail Incentives: This fund accounts for the receipt and disbursement of sales tax revenues related to the 2001 tax increment financing project and any future retail related TIF districts.
While the City maintains Capital Project Funds, they are not required to be budgeted by State statutes, but are required to report actual expenditures. The City budgets them for internal control purposes and they are reported in the Comprehensive Annual Financial Report (CAFR.)
The City also maintains funds that are funded by federal funds that are not required to be budgeted by State Statutes. These funds are also required to report actual expenditures to the state and are budgeted for internal control purposes. They are reported in the Comprehensive Annual Financial Report (CAFR.)
In addition to the fund types mentioned above, the City’s fund structure includes departments, which is a group of related operations within a functional area; divisions, which are segments within a department that are assigned specific operations; categories, which are classifications of specific revenues and expenditures; and account lines, which are specific revenue and expenditure types.
The revenue structure used in the City’s budgeting and accounting system is by fund, function, department, division, category, and object. The revenue object number designates a specific revenue source that is applied consistently throughout the funds. The expenditure structure is set up similar to the revenue structure. The expenditure object number designates a specific expenditure type that is applied consistently throughout the funds.
