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                                                                                         City of Muskegon
                                                                                         Proprietary Funds

                                  STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS

                                                             Year Ended December 31, 2003

                                                                                                           Business-Type Activities                                                                        Governmental
                                                                                                                               Enterprise Funds                                                                Activities

                                                                                                                                           Marina and 
                                                                     Sewer                                 Water                         Launch Ramp                             Total                     Internal Service

Operating revenues
   Charges for services                                    $      4,021,244
                                                                                                  $    4,045,086
                                                                                                                                         $         263,880
                                                                                                                                                                      $      8,330,210
                                                                                                                                                                                                          $                      - 
   Charges to other funds                                                -                                     -                                        -                            -                              5,878,071
                                                                                                                                                                                                                    
   Other revenues                                                       36,499
                                                                                                              86,040
                                                                                                                                                      10,378
                                                                                                                                                                                  132,917
                                                                                                                                                                                                                       228,961
                                                                                                                                                                                                                              
Total operating revenues                                           4,057,743
                                                                                                        4,131,126
                                                                                                                                                    274,258
                                                                                                                                                                              8,463,127
                                                                                                                                                                                                                    6,107,032
                                                                                                                                                                                                                    

Operating expenses
   Operating and administrative                                       388,912
                                                                                                            494,737
                                                                                                                                                    265,785
                                                                                                                                                                              1,149,434
                                                                                                                                                                                                                    2,692,406
                                                                                                                                                                                                                    
   Insurance premiums and claims                                                 -                                     -                                        -                            -                      3,497,569
                                                                                                                                                                                                                    
   Wastewater treatment                                            2,253,677
                                                                                                                       -                                        -             2,253,677
                                                                                                                                                                                                                                  - 
   Filtration plant operations                                                   -                      1,086,457
                                                                                                                                                                -             1,086,457
                                                                                                                                                                                                                                  - 
   Water distribution                                                            -                      1,952,814
                                                                                                                                                                -             1,952,814
                                                                                                                                                                                                                                  - 
   Bad debts                                                              6,865
                                                                                                                5,682
                                                                                                                                                                -                   12,547
                                                                                                                                                                                                                                  - 
   Depreciation and amortization                                      667,831
                                                                                                            615,470
                                                                                                                                                      61,308
                                                                                                                                                                              1,344,609
                                                                                                                                                                                                                       704,264
                                                                                                                                                                                                                              
Total operating expenses                                           3,317,285
                                                                                                        4,155,160
                                                                                                                                                    327,093
                                                                                                                                                                              7,799,538
                                                                                                                                                                                                                    6,894,239
                                                                                                                                                                                                                    

   Operating income (loss)                                            740,458
                                                                                                            (24,034)
                                                                                                                                                     (52,835)
                                                                                                                                                                                  663,589
                                                                                                                                                                                                                     (787,207)
                                                                                                                                                                                                                         

Nonoperating revenues (expenses)
   Investment income                                                    19,739
                                                                                                              51,889
                                                                                                                                                                -                   71,628
                                                                                                                                                                                                                         26,476
                                                                                                                                                                                                                                   
   Gain (loss) on sale of capital and other assets                               -                          (88,767)
                                                                                                                                                                -                 (88,767)
                                                                                                                                                                                                                         15,053
                                                                                                                                                                                                                                   
   State grants                                                                  -                                     -                            256,612
                                                                                                                                                                                  256,612
                                                                                                                                                                                                                                  - 
   Interest expense                                                 (132,214)
                                                                                                          (436,560)
                                                                                                                                                                -               (568,774)
                                                                                                                                                                                                                                  - 
Total nonoperating revenues (expenses)                              (112,475)
                                                                                                          (473,438)
                                                                                                                                                    256,612
                                                                                                                                                                                (329,301)
                                                                                                                                                                                                                         41,529
                                                                                                                                                                                                                                   

   Income (loss) before transfers                                     627,983
                                                                                                          (497,472)
                                                                                                                                                    203,777
                                                                                                                                                                                  334,288
                                                                                                                                                                                                                     (745,678)
                                                                                                                                                                                                                         

Transfers
   Transfers in                                                                  -                                     -                                        -                            -                      1,179,938
                                                                                                                                                                                                                    

   Change in net assets                                               627,983
                                                                                                          (497,472)
                                                                                                                                                    203,777
                                                                                                                                                                                  334,288
                                                                                                                                                                                                                       434,260
                                                                                                                                                                                                                              

Net assets at beginning of year                                  12,995,110
                                                                                                      23,369,263
                                                                                                                                                 1,200,715
                                                                                                                                                                            37,565,088
                                                                                                                                                                                                                    4,221,757
                                                                                                                                                                                                                    
 Net assets at end of year                                 $    13,623,093                        $  22,871,791                                  1,404,492
                                                                                                                                         $                            $    37,899,376
                                                                                                                                                                                                          $        4,656,017


Reconciliation to the statement of activities

Total change in net assets of enterprise funds                                                                                                                        $          334,288
                                                                                                                                                                                       

Some amounts reported for business-type activities
 in the statements of activities are different because
 the net revenue (expense) of certain internal service 
 funds is reported with business-type activities                                                                                                                                    88,353
                                                                                                                                                                                                      

Change in net assets of business-type activities                                                                                                                      $          422,641
                                                                                                                                                                                       










The accompanying notes are an integral part of this statement.