ML083510232
| ML083510232 | |
| Person / Time | |
|---|---|
| Site: | San Onofre  |
| Issue date: | 12/10/2008 |
| From: | Scherer A E Southern California Edison Co |
| To: | Document Control Desk, Office of Nuclear Reactor Regulation |
| References | |
| Download: ML083510232 (261) | |
Text
SOUTHERN CALIFORNIA A. Edward Scherer Director__EDISONNuclear Regulatory Affairs An EDISON INTERNATIONAL Company December 10, 2008 U. S. Nuclear Regulatory Commission Attention:
Document Control Desk Washington, D. C. 20555
Subject:
Docket Nos. 50-361 and 50-362 Annual Corporate Financial Reports San Onofre Nuclear Generating Station Units 2 and 3
Dear Sir or Madam:
In accordance with the requirements of 10 CFR Part 50, Section 50.71(b), enclosed are copies of the annual financial reports for the licensees of the San Onofre Nuclear Generating Station, Units 2 and 3, who do not submit a Form 10-Q with the Securities and Exchange Commission or a Form 1 with the Federal Energy Regulatory Commission:
the City of Riverside, California (for the fiscal year ending June 30, 2007);and the City of Anaheim, California (for the fiscal year ending June 30, 2007). Each report includes the appropriate certified financial statement required by Section 50.71(b).If you have any questions or need additional information regarding this matter, please contact me at 949-368-7501.
Sincerely, Enclosures cc: E. E. Collins, Regional Administrator, NRC Region IV N. Kalyanam, NRC Project Manager, San Onofre Units 2 and 3 G. G. Warnick, NRC Senior Resident Inspector, San Onofre Units 2 and 3 P.O. Box 128 0 1K San Clemente, CA 92674 FINANCIAL RT 07 11/16/07 9:15 AM Page 2 CITY OF RIVERSIDE, CALIFORNIA COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR FISCAL YEAR ENDED JUNE 30, 2007 Prepared by the City Manager's Office -Finance Division Paul C. Sundeen, Assistant City Manager/Chief Financial Officer 3900 Main Street, Riverside, California 92522 (951) 826-5660 This report was printed on recycled stock
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CITY OF RIVERSIDE COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED JUNE 30, 2007 TABLE OF CONTENTS INTRODUCTORY SECTION Page L etter of Transm ittal ..............................................................................................
.... v GFOA Certificate of Achievem ent ......................................................................................
ix Legislative and City O ffi cials ...........................................................................................
x Organization Chart...............................................................
x FINANCIAL SECTION Independent A uditor's R eport .............................................................................................
1 M anagem ent's Discussion and A nalysis .................................................................................
3 Basic Financial Statements:
Government-wide Financial Statements:
Statem ent of N et A ssets ..........................................................................................
21 Statem ent of A ctivities
...........................................................................................
22 Fund Financial Statements:
Balance Sheet -Governm ental Funds ..........................................................................
23 Reconciliation of the Balance Sheet of Governmental Funds to Statement of Net Assets ..............
24 Statement of Revenues, Expenditures and Changes in Fund Balances -Governmental Funds .........
25 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activitites
..................................................
26 Statement of Revenues, Expenditures and Changes in Fund Balances -Budget and Actual -G eneral F und .........................................................................................
....... 27 Statement of Net Assets -Proprietary Funds ..................................................................
28 Statement of Revenues, Expenses and Changes in Fund Net Assets -Proprietary Funds ..............
30 Statement of Cash Flows -Proprietary Funds ................................................................
31 Statement of Fiduciary Net Assets -Fiduciary Fund -Agency Fund ......................................
33 N otes to Financial Stateml ents ......................................................................................
34 Combining and Individual Fund Statements and Schedules:
Combining Balance Sheet -Nonmajor Governmental Funds ..............................................
61 Combining Statement of Revenues, Expenditures and Changes in Fund Balances -Nonmajor G overnm ental Funds ........................................................................................
63 Schedule of Revenues, Expenditures and Changes in Fund Balances -Budget and Actual -N onm ajor Governm ental Funds ............................................................................
65 Combining Statement of Net Assets -Nonmajor Enterprise Funds. ..........................
69 Combining Statement of Revenues, Expenses and Changes in Fund Net Assets -Nonmajor Enterprise Funds.........................................................
71 CITY OF RIVERSIDE COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED JUNE 30, 2007 TABLE OF CONTENTS FINANCIAL SECTION (CONT.)Combining Statement of Cash Flows -Nonmajor Enterprise Funds .......................................
Combining Statement of Net Assets -Internal Service Funds ...............................................
Combining Statement of Revenues, Expenses and Changes in Fund Net Assets -Internal Service Funds .................................................................
Combining Statement of Cash Flows -Internal Service Funds .............................................
Combining Statement of Changes in Assets and Liabilities
-Fiduciary Fund ............................
Capital Assets Used in the Operation of Governmental Funds: Schedule by Source ..........................................................................................
Schedule by Function and A ctivity .........................................................................
Schedule of Changes by Function and Activity ........................................................
STATISTICAL SECTION Table 1 Net Assets by Component
-Last Seven Fiscal Years ........................................................
2 Changes in Net Assets -Last Seven Fiscal Years ............................................................
3 Fund Balances of Governmental Funds -Last Ten Fiscal Years ...........................................
4 Changes in Fund Balances of Governmental Funds -Last Ten Fiscal Years .............................
5 Business-Type Activities Electricity Revenues By Source -Last Seven Fiscal Years ..................
6 Governmental Activities Tax Revenues By Source -Last Seven Fiscal Years .........................
7 Assessed Value and Estimated Actual Value of Taxable Property -Last Ten Fiscal Years ............
8 Direct and Overlapping Property Tax Rates -Last Ten Fiscal Years ....................................
9 Principal Property T axpayers ....................................................................................
10 Property Tax Levies and Collections
-Last Ten Fiscal Years ....................
................
I .....1 Electricity Sold by Type of Customer-Last Ten Fiscal Years .............................................
12 Electricity Rates -Last Ten Fiscal Y ears .......................................................................
13 Top -10 Electricity Customers
-Current Year and Nine Years Ago .......................................
14 Ratios of Outstanding Debt by Type -Last Ten Fiscal Years .............................................
15 Ratios of General Bonded Debt Outstanding
-Last Ten Fiscal Years ......................................
16 D irect and O verlapping D ebt .................................................................................
17 Legal Debt Margin Information
-Last Ten Fiscal Years ....................................................
18 Pledged-Revenue Coverage Governmental Activity Debt -Last Ten Fiscal Years ..................
19 Pledged-Revenue Coverage Business Type Activity Debt -Last Ten Fiscal Years ..................
20 Demographic and Economic Statistics
-Last Ten Fiscal Years ..........................................
21 Principal Employers
-Current Year and Nine Years Ago ................................................
22 Full-Time Equivalent City Government Employees by Function -Last Ten Fiscal Years ............
72 75 76 77 79 81 82 83 86 87 89 90 92 93 94 95-96 97 98 99 100 10I 102 103 105 106 107 108 109 110 CITY OF RIVERSIDE COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED JUNE 30, 2007 TABLE OF CONTENTS STATISTICAL SECTION (CONT.)Table 23 Operating Indicators by Function -Last Ten Fiscal Years ................................................
24 Capital Asset Statistics by Function -Last Ten Fiscal Years .............................................
25 Cash Debt Reserves Tax Allocation Bonds -Last Ten Fiscal Years ....................................
Page 111 112 113 October 12, 2007 To the Honorable.Mayor,..Members of the City Council and Citizens of the City of Riverside:
It is our pleasure to submit the Comprehensive Annual Financial Report (CAFR) of the City of Riverside (the City) for the fiscal year.ended June 30, 2007: Thisreport consists of management's representations, concerning the finances of the City. Consequently, management assumes full responsibility for the completeness and reliability of all of the inf6nnation presented in this report. To provide a reasonable basis for makiing these ;representations., management has. established a comnprehensiVe internal control framework that is designed both to protect the City's assets from. loss, theft, or misuse and to compile. sufficient reliable informnation for the preparation (if the City's financial..statements in conformity with accounting principles, generallyaccepted in the. United States of America. Because the cost of internal controls should not outweigh their benefits, internal controls have. been designed to provide reasonable rather than absolute assurance that the financial will be free fromn material, misstatement.
As manageihent, we assert that; to .the best of our knowledge and belief. this financial repot. is completeand reliable in all material.respects.
The Citys financial, statements have been audited by Mayer Hoffman McCann P.C., a firn of certified public. accountants.
The independenit auditor concluded, based on the audit, that there was a reasonable basis for rendering an unqualified opinion on the City's financial.statements for the fiscal year ended June 30, 2007. The independent auditor's repoort is presented as the first component of the financial section of this CAFR.: 'The independent audit of the financial statements of the City was part of a broader, federally mandated "Single Audit" designed to, meet the special needs of federal grantor. agencies.
The standards governing Single Audit engagements ,require the independent auditor to report not only on the fair presentation
- of the financial statements, but also on internal controls, and compliance with legal requirements, with emphasis on those involving the administration of-federal awards. Thesereports are available in the City's separately issued Single Audit Report.Management has provided :an overall analysis of the financial statements in the form of Management's Discussion and Analysis (MD&A). This letter of transmittal.
is designed to complement MD&A and. should be read in conjunction With it. The City's MD&A can be found immediately following the report of ithe independent auditors.V:
Profile of the City of Riverside The City of Riverside, incorporated on. October 11, 1883, is located in the western portion of Riverside County about 60 miles east of Los Angeles. The City currently occupies, ajland area of 80.9'62 square miles.The City operates under the council-manager form of government, with a 'seven-member council elected by ward for. four-year overlapping .terms. The mayor: is elected at large for a four-yeaf term and is the presiding officer of the Council, but does not have a vote except in the case of a tie. The City Council is responsible, among other things, for passing .odinances, adopting the budget, appointing committees, and hiring the City Manager, City Attorney and City Clerk. The City Manager is respwnsible for carrying out the policies 'and ordinances of the Council; for overseeing the day-to-day operations of the City, and for appointing the heads of various departments., The Council is elected ona non-partisan basis.The City provides a full range. of services which :include general. government, public safety (police, fire, disaster preparedness and:building inspection), construction and maintenance of highways and streets, economic development, culture and recreation, electric, water, airport, refuse, sewer, and senior citizen/handicap transportation.
In addition to general City activities, the Council is financially accountable for the Riverside Redevelopment Agency, Riverside Public Financing Authority and the Riverside Municipal Improvements Corporation; therefore, these entities are included as an integral part of the City's finafncial statements.
Additional information on these. legally separate entities can be found in.Note 1 in the notes to the financial statements.
The annual budget serves as the foundation for the 'City's financial planning and control..
The City Manager presents the proposed budget 'to ýthe City Council for review at, least thirty-five calendar days prior .to the beginning of each fiscal year. The Councii is required to hold public hearings on the proposed budget and to adopt a final budget no later than June 30, which is the close of the City's fiscal year. The appropriated budget is prepared by fiJnd and department.
Department heads may make. triansfers of appropriations within a department, Transfers of appropriations between departments-however,, require the approval of the Council.Budget-to-actual.
comparisons are provided iný this report for each individual governmental fund for which an appropriated annual budget has been adopted. For the general fund, this comparison is presented on page 271 as part of the basic financial statements for the governmental, funds. For governmental funds: other than the general fund, with appropriated annual budgets. this comparison is presented in the governmental fund subsection of this report, which begins on page 65.Local economy., The City is located in the Inland Einpire; which consists of Riverside and San Bernardino Counties.
The population of the Inland Empire at 415 million people is larger than:24 states. The City leads the Inland Empire in most measures of economic power, including population,, income., employment, bank deposits, assessed.
valuation, office space and college enrollment.
The ,population of the City is 295,730 which places the City as the seventh largestinSouthern California.
The Inland Empire has a: very-strong economic environment4.
as does the. City. This area is expected to add about 49,000 jobs during the calendar year 2007. The City owned electric utility gives it ,a competitive advantage at this time when energy costs and reliability are issues. Riverside's challenges include a lack of available space for manufacturing and industrial development within its current boundaries.
Priorities for the future: A Citywide Strategic Planning document has been developed through a seriesof meetings, workshops, and-surveys with thecommunity, elected officials, and City employees, The plan, as updatedsets forth four goals as follows: o Economic.Development o Growth and Annexation
- Transportation.
o Liveable:
Communities and Neighborhoods Long-term financial planning.
Annually, the City updates a five. (5) year Capital Improvement Program (CIP). Planned capital expendittires during fiscal years 2.007/081-20i1/12 total $ 909million.
The level of capital improvements is significantly greater than the. historical ,level. The projects encompass all. seven.Council wardsand enhance the-life of all residents.
Funding comes from.multiple sources, including existing funds;. General Fund certificates of participation, Redevelopment Agency tax allocation bonds: regional, state and federal:funds anid, the proposed sale of property deemed to be surplius.
In addition to routine electric, water, sewer and transpottationi-related projects,'tlhe CIP includesimiprovements to all parks in the City; railroad grade separations; library, museum, convention centerand MunicipaqlAuditorium improvements/expansions/rehabilitations; and. public safety projects..Cash management policies and practices.
Cash temporarily idle during the year ,was invested principally in. federal agency securities,.
mohey'market.
funds and medium tenn, notes. The maturities of the investmfients do not exceed five (5) years, with the:average maturity not exeeding three (3)years.
All securities are held in third party safekeeping by Union Bank of California as agent for-the' City. All transactions originated and authorized by the City are transacted on a delivery versus payment (DVP) basis in order to' perfect delivery, The ayerage yield on the inyestmnents was 4.2% for the-fiscal year.Risk management.
Risk exposures to the assets of the City are managed through a Icombination, of self-insuired retention and insurance coverage.
The City believes.it has current assets adequate to cover the actuarially determined.
liability for general liability'and workers" compensation claims, including estimated claims incurred but not reported, as they become payable. The City maintains excess liability insurance to provide coverage beyond a self-insured retention of $3,O00,000..per occurrence for both general liability and Workers' compensation.
vii Pension benefits.
The City provides, pension benefits.
for all employees through a statewide plan managed by the California Public Employees Retirement System (CalPERS).
The City has no obligation in connection with employee benefits offered through this plan beyond its annual contractual payment to CalPERS. Additional information on the plan can be.found in Note 13 in the notes to the finarncial statements.
Awards and Acknowledgements The Government Finance Officers Association (GFOA) awarded a Certificate of AchieVement for Excellence in Financial Reporting to the City of RierSidefor its compr~ehensiVe annual financial report (CAFR) for the. fiscal yeat ended June 30, 2006. This was the twentieth consecutive year that the City has received this prestigious, award. The: City received this award for publishing an easily readable and efficiently organized CAFR that satisfied both, GAAP and applicable legal requiremients, This award is valid for a period.of one yearonly., We believe that-ourcurrent CAFR continues to meet tile Program's requirements and'we are submitting it to the GFOA again this year.The preparation of this- report would nothave been possible without thle efficient and dedicated services of the entire staff of the Finance Division, particularly the leadership ofTerr Willoughby, Controller.
we Would like to express our appreciation to all members of the Divisioa who assisted and contributed to .its preparation.
Credit also must be. given to the Mayor and the City Council for their unfailingsupport for maintaining the highest standards of professionalism in the management of the City's finances.Respectfully submitted, Bradley J. s Paul C.. Sundeen City Ma 'er Assistant City Manager/CFO/Treasurer Viii crti fietaie ofI for Excellence in Fmainacial-Reporting
'City ol Rivctside fur dIle~~ K~KF~~The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Riverside for our Comprehensive Annual Financial Report for the fiscal year ended June 30, 2006.In order to be awarded a Certificate of Achievement, a governmental unit must publish an easily readable and efficiently organized Comprehensive Annual Financial Report, whose contents conform to program standards.
Such reports must satisfy both generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only.We believe our current report continues to conform to Certificate of Achievement Program requirements, and We are submitting it to GFOA to determine its eligibility for another certificate.
ix LEGISLATIVE OFFICIALS OR( A\IZATIO\7 CHA~RT Ronald 0. Loveridge
.............................................
Mayor Dom Betro ................................
Councilmember-Ward 1 Andy Melendrez
........................
Councilmember-Ward 2 Art Gage ...................................
Councilmember
-Ward 3 Frank Schiavone
...........
Councilmember-Ward 4 Ed Adkison ...............................
Councilmember
-Ward 5 Nancy Hart ...............................
Councilmember-Ward 6 Steve Adams .............................
Councilmember
-Ward 7 CITY OFFICIALS Bradley J. Hudson ...................................
City Manager*Michael Beck ...............................
Assistant City Manager Tom DeSantis ..............................
Assistant City Manager Paul C. Sundeen ...................
Assistant City Manager/CFO Mark S. Ripley .......................................
Airport Director Colleen J. Nicol ..............................................
City Clerk*Gregory P. Priamos ....................................
City Attorney*Tom Boyd .................................................
City Engineer Russ Leach ..............................................
Chief of Police Steve Reneker ...........................
Chief Information Officer Scott Barber ................
Community Development Director Belinda Graham .............................
Development Director Tedd Laycock ..................................................
Fire Chief Kris Martinez ...........................
General Services Director Rhonda Strout .......................
Human Resources Director Barbara Custen .......................................
Library Director Ennette Nusbaum ...................................
Museum Director Ralph Nuflez .........................
Park and Recreation Director David Wright ................................
Public Utilities Director Siobhan Foster ..............................
Public Works Director*Appointed by City Council x
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An Iridep, A den CPA Firr::2301 .Ji tDrive, Suite 200 Irin, altoia92612 94917-174 U2().: h-949263 5520: fx wwwj.'irh
ý cý: l -.Co( 'Honorable Mayor and Members of the City Council City of Riverside Riverside, California INDEPENDENT AUDITORS' REPORT We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of the City of Riverside, California, (the City) as of and. for the year ended June 30, 2007, which: collectively comprise, the City's basic financial statements, as listed in the table of contents.
T*hese financial statements are the responsibility of the City's management.
Our responsibility is to express opinions on these financial statements based on our audit.We conducted our audit in accordance:
with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Siandards, issued by the Comptroller General of the United States.Those standards.
require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatemeniit.
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and significant estimates made by management, as. well as evaluating the overall financial, statement presentation.
We believe that our audit provides a reasonable basis for our opinions.In our opinion, the financial statements referred to above present fairly, in all material.
respects, the respective financial position of the governmental activities, the business-type activities, each major fund and the. aggregate remaining fund information of. the City of Riverside, California, as of June 30, 2007, and the: respective changes in financial position and cash flows, where applicable, and the respective budgetary comparison for the general. fund for the year then ended, in confornity with accounting principles generally accepted in the.United States of America.I Honorable Mayor and Membersof the City Council City of Riverside Page Two The Management's Discussi6n and Analysis.
as listed in the table of contents, is not a required.part of the basic financial statements but i..s supplementary information required by accounting principles generally accepted in the United States of America. We have applied. certain, limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplementary infornation.
However, we did not audit, the inform ation and express no opinion on it.Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City's basic financial statements.
The combining, and individual nonmajor fund financial statements mad oilier schedules, listed in the table of contents as supplementary information,.are presented for purposes of additional analysis and are not a required part of the basic financial statements.
Such information has been. subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole.The accompanying introductory and statistical sections.
as listed in the table of contents, are presented for the purpose of additional analysis and are not a required part of the basic financial statements.
This information has not been subjected to the auditing procedures applied in the audit of the basic financial statements and,. accordingly, we express no opinion on it.In accordance with Government Auditing Standards, we have also issued our.report dated October 12, 2007 on our consideration of the City's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts, grant agreements.
and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the, results of that testing, and not to provide an opinion on the internal control over financial reporting or on: compliance.
That report, is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit.Irvine, Califorma October 12, 20.07 2
-.Management's Discussion and Analysis As management of the City of Riverside, we offer this narrative overview and analysis of financial activities for the fiscal year ended June 30, 2007. We encourage readers to consider the information presented here in conjunction with additional information furnished in our letter of transmittal, which can be found on page v of this report. All amounts, unless otherwise indicated, are expressed in thousands of dollars.Overview of the Financial Statements This discussion and analysis are intended to serve as an introduction to the City's basic financial statements, compromised of three components:
- 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements.
This report also contains certain supplementary information.
Government-wide financial statements.
The govern-ment-wide financial statements are designed to provide readers with a broad overview of the City's finances, in a manner similar to a private-sector business.The.statement of net assets presents information on all of the City's assets and liabilities, with the excess of assets over liabilities reported as net assets. Over time, increases or decreases in the net assets may serve as a useful indicator of whether the financial position of the City is improving or deteriorating.
The statement of activities presents information showing how the City's net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave).The government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business type activities).
The governmental activities of the City include general government, public safety, highways and streets, and culture and recreation.
The business type activities of the City include Electric, Water, Sewer, Refuse, Public Parking, Airport and Transportation services.3 The government-wide financial statements include the City and it's component units. The City's component units are the Riverside Redevelopment Agency, Riverside Public Financing Authority, and the Riverside Municipal Improvements Corporation.
Although legally separate, these entities function for all practical purposes as departments of the City and therefore have been blended as part of the primary government.
Both the Governmental Activities and the Business Type Activities are presented on the accrual basis of accounting, a basis of accounting that differs from the modified accrual basis of accounting used in presenting governmental fund financial statements.
Note 1 of the Notes to the Basic Financial Statements fully describe these bases of accounting.
Proprietary funds, discussed below, also follow the accrual basis of accounting.
The government-wide financial statements can be found on pages 21-22 of this report.Fund financial statements.
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives.
The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.
All of the funds of the City can be divided into three categories:
governmental, proprietary, and fiduciary.
Governmental funds. Governmental funds are used to account for the same functions reported as governmental activities in the government-wide financial statements.
However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources as well as on balances of spendable resources available at the end of the fiscal year.It is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements.
Reconciliations to facilitate this comparison are provided for both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances.
The major reconciling items relate to capital assets and debt. In the Governmental Funds, acquisitions of capital assets are treated as"expenditures" because upon purchase of a capital asset, cash used for the acquisition is no longer available for other purposes.
The issuance of debt provides cash, which is now available for specified purposes.
Accordingly, at the end of the fiscal year, the unreserved fund balances of the Governmental Funds reflect spendable resources available for appropriation by the City Council.Spendable balances are not presented on the face of the government-wide financial statements.
The City maintains seventeen individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the General Fund, the Redevelopment Agency Debt Service Fund, the Capital Outlay Fund, and the Redevelopment Capital Project Fund all of which are major funds. Data from the other thirteen governmental funds are combined into a single, aggregated presentation.
Individual fund 4 data for each of these non-major governmental funds is provided in the form of combining statements and can be found on pages 61-68 in this report.The City adopts an annual appropriated budget for its General Fund. A budgetary comparison statement has been provided to demonstrate compliance with this budget.The governmental fund financial statements can be found on pages 23-27 of this report.Proprietary funds. The City maintains two different types of proprietary funds, enterprise and internal service funds. Enterprise funds are used to report the same functions presented as business type activities in the government-wide financial statements.
The City uses enterprise funds to account for Electric, Water, Sewer, Refuse, Parking, Airport and Transportation services.
Internal service funds are an accounting device used to accumulate and allocate costs internally among the City's various functions.
The City uses internal service funds to account for self-insured insurance programs, central stores and its fleet of vehicles.
Because these services predominantly benefit governmental rather than business type functions, they have been included within governmental activities in the government-wide financial statements.
Internal service funds are presented as proprietary funds because both enterprise and internal service funds follow the accrual basis of accounting.
Proprietary funds provide the same type of information as the government-wide financial statements (business type activities), only in more detail. The proprietary fund financial statements provide separate information for the Electric, Water and Sewer operations, all of which are considered to be major funds of the City. The four remaining proprietary funds noted above are combined into a single, aggregated presentation.
All internal service funds are also combined into a single, aggregated presentation in the proprietary fund financial statements.
Individual fund data for the non-major proprietary funds and the internal service funds is provided in the form of combining statements and can be found on pages 69-78 in this report.The basic proprietary fund financial statements can be found on pages 28-32 of this report.Agency funds. Agency funds are used to account for situations where the City's role is purely custodial.
Agency funds are not reflected in the government-wide financial statement because the resources of those funds are not available to support the City's own programs.
All assets reported in agency funds are offset by a liability; the accrual basis of accounting is used to recognize receivables and payables.The agency fund financial statement can be found on page 33 of this report, and the combining statement can be found on page 79.Notes to the financial statements.
The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements.
The notes to the financial statements begin on page 34 of this report.5 Government-wide, Financial Analysis The following table presents a summarization of the City's assets, liabilities and net assets for its governmental and business type activities.
As noted earlier, a government's net asset position may serve over time as a useful indicator of its financial position.Governmental Business type Activities Activities Total 2007 2006 2007 .2006 2007 2006 Current and other assets $814,979 $569,741 $ 454,149 $ 481,914 $ 1,269,128
$ 1,051,655 Capital assets, net 72,2536 660,14 948,36 877,67 1,740,8421,381 Total assets 1,607,15 1,%22,35 14255 ,3951 3,09,702,846 Current liabilities 118,973 90,849 92,584 88,681 211,557 179,530 Long-term liabilities 70,0 40997 49,3 3 5418111,2L37 934,131 Total liabilities 8209277 500,822 581,817 612839 1,402,794 1,113,66 Net assets: Invested in capital assets, net of related debt 712,801 622,336 520,059 425,285 1,232,860 1,047,621 Restricted 415,618 158,038 57,613 71,386 473,231 229,424 Unrestricted (341,881)
(51,261) 242,9665,4 (98,915) 9,8 Total net assets $79137SZS46.7J 12 $167.7 $1475,825-The City's assets exceeded liabilities by $1,607,176 at June 30, 2007, an increase of $13 1,351 from June 30, 2006.By far the largest portion of the City's net assets (77 percent) reflects its investment in capital assets (i.e., land, buildings, machinery, equipment and infrastructure), net of any related debt that is still outstanding used to acquire those assets and net of unspent bond proceeds and cash held in bond reserve accounts.
The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending.An additional portion of the City's net assets (29 percent) represents resources that are subject to external restrictions on how they may be used. The remaining unrestricted net assets may be used to meet the government's ongoing obligations to citizens and creditors.
Of this amount, $242,966 is held by the business type activities; and negative $341,881 is held by the governmental activities.
The Riverside Redevelopment Agency (the Agency), a blended component unit of the City, represents
$276,012 of negative unrestricted net assets for 2007 and was a negative $112,747 in the prior year. The remaining governmental activities of the City have 6 negative unrestricted net assets of $65,869 in 2007 and a positive $61,486 in 2006. This decrease in unrestricted net assets is primarily due to the restriction of net assets for unspent bond proceeds pertaining to capital projects.The Agency exists to finance improvements that serve to remediate blight within the City. Often these activities do not result in a residual asset, but rather underwrite the cost of a development activity deemed beneficial in meeting the Agency's objectives.
Tile resulting statement of net assets reflects the debt obligation to be repaid through future tax revenues, without an offsetting asset.While this is the routine functioning of such an entity, when blended with the City, its negative unrestricted net assets causes the governmental activities to report a negative position.The City's total net assets increased by $131,351 during the current fiscal year, which reflects the growth in both the governmental
($57,425) and business type ($73,926) activities.
This is primarily due to continued investment by the City in its infrastructure, which is largely funded by grants and dedicated revenue sources. Lastly, business type unrestricted assets grew based on municipal service charges for service exceeding the current years operating expenditures.
The following is a condensed summary of activities of the City's governmental and business type operations for the period ended June 30, 2007 with the prior fiscal year presented for comparative purposes.
Also included in the following analysis are revenue and expense graphs to aid in understanding the results of the current year's activities.
7 Governmental Activities Business Type Activities Tta Total Revenues: Program Revenues: Charges for services Operating Grants and Contributions Capital Grants and Contributions General Revenues: Sales taxes Property taxes Other taxes and fees Grants and contributions not restricted to specific programs Other Total revenues Expenses: General government Public safety Highways and streets Culture and recreation Interest on long-term debt Electric Water Sewer Refuse Airport Transportation Public Parking Total expenses Increase in net assets and transfers:
Transfers Increase in net assets Net assets -beginning
-restated Net assets -ending 2007$61,520 12,101 10,557 55,666 106,114 35,859 29,743 2006 2007 2006$338,092 2,704 29,293 2007$ 432,374 14,040 50,623 2006$ 401,748 15,854 47,911$ 63,656 13,150 18,618$370,854 1,939 40,066 57,522 80,934 34,434 55,666 106,114 35,859 57,522 80,934 34,434 80,353 134,062 28,944 32,964 26,378 39,632 344,290 74,458 120,470 20,757 32,602 16,358 29,959 400,48 30Q2,701 31,669 31,171 62,840 723,698 264,645 79,645 105,221 6729.1813 232,346 42,108 29,510 16,490 1,20 1 2,831 105,097 (31,171)73,926 746,712 226,186 39,486 27,299 14,546 1,004 2,917 2,701 85,909 (25,576)60,333 68,79 29,743 43,296 767,715 80,3 -53 134,062 28,944 32,964 26,378 232,346 42,108 29,510 16,490 1,201 2,831 630,949 136,766 136,766 1,470,410 39,653 74,458 120,470 20,757 32,602 16,358 226,186 39,486 27,299 14,546 1,004 2,917 2,701 578,784 165,554 165,554 1,310,271 8 Governmental activities.
Governmental activities increased the City's net assets by $62,840 accounting for 46 percent of the total growth in net assets. The net assets in the prior fiscal year increased by $105,221.
Key elements of this year's activity in relation to the prior year are as follows: Revenues:* Operating and capital grants and contributions, in total, decreased approximately
$9,100 in 2007 primarily due to decreased grant funding for street capital projects.* Property taxes increased approximately
$25,180 in 2007, principally because of the strong local economy, increased property values and the expansion of redevelopment project areas and activities.
- Grants and contributions not restricted to specific programs decreased
$10,000 mainly due to a decrease in developer contributed assets.* The total net decrease in Other general revenues was approximately
$13,400 primarily due to an issuance of special assessment debt in the prior year, offset by an increase in investment income in the current year.Expenditures and Transfers:
- While significant variances between years exist for the various expense functions, the total net increase was approximately
$32 million. The more significant items are: (1) increased salaries and benefits, including the addition of sworn officers, (2) increased costs associated with capital projects and development activities, (3) increased personnel costs associated with the addition of public works personnel connected with enhanced highway and streets maintenance, and (4) increased costs resulting from additional park and recreation programs.
Transfers to governmental funds increased
$5,595 primarily due to increased operating revenue realized by the Electric and Water funds.9 Expenses and Programs Revenues -Governmental Activities
-Fiscal Year Comparison 2007 vs. 2006$160,000$140,000 -$120,000 -$100,000 -$80,000 -$60,000 -$40,000 -$20,000 -0',07 Expenses EF06 Expenses EY07 Program revenues 0'06 Program revenues$o 4-General government Public safety Highways and streets Culture and recreation Interest on long-term debt 10 Revenues by Source -Governmental Activities
-Fiscal Year Comparison 2007 2006 Capital grants and contributions 5%Capital grants and contributions 3%Operating grants and contributions 4%Operating grants and contributions 4%Property taxes 23%Charges for services 18%Charges for services 17%Grants and Grants and contributions not restricted to specific programs 9%contributions not restricted to specific -programs 12% Miscellaneous 8%Miscellan 1%/inons- e / .Other Investment%
income 1%6%Intergovernmental, unrestricted 1%V\Franchise taxes 2%S:ales taxes 17%Franchise taxes 1%Utility sers taxes 7%Utility users taxes 8%Intergovernmental, unrestricted I1%I I Business type activities.
Business type activities increased the City's net assets by $73,926, accounting for 54 percent of the total growth in net assets. The net assets of business type activities increased by $60,333 in the prior year. Key elements of this year's increase in relation to the prior year are as follows: " In 2007, charges for services increased
$32,762 to $370,854 primarily due to an increase in the volume of electric and water sales, an electric rate increase, the effects of the third and final year of an overall 8% water rate increase, as well as the implementation of the first year of the five year Safe W.A.T.E.R.
rate plan consisting of a 12% increase effective November 1, 2006.* Capital grants and contributions increased
$10,773 in the current year to $40,066. The increase is due to a City contribution for the construction of a fiber optic network as well as contributions resulting from settlement agreements relating to litigation pertaining to contaminated ground water.* Other revenues decreased by $9 million mainly due to a prior year sale of surplus land." The total net increase in expenses in Business type activities was approximately
$14 million. Significant items include increased depreciation expense due to the completion of the Riverside Energy Resource Center, increased interest costs, as well as overall increases in staffing levels.Expenses and Program Revenues -Business Type Activities
-Fiscal Year Comparison 2007 vs. 2006$300,000 $17,000$275,000 $ 16,000 M'07 Expenses $15,000$250,000 P m $14,000 '07 Expenses$22,00 -'07 Program revenues $13,000- 07Pormevns
[]'07 Program revenues$22,00'06 Expenses $12,000 -E'06 Expenses$200,000 -0'06 Program revenues $ 0 06 Program revenues$10,000$175,000 -:: $10,000$150,000 -$9,000$8,000$125,000 -: $7,000$100,000 $6,000$75,000$4,000$50,000 $3,000$25,000 2,000 Electric Water Sewer eu....
- r ....... , Refuse ýirporl ransportal on ar ng 12 Revenues by Source -Business Type Activities
-Fiscal Year Comparison 2007 2006 Capital grants and contributions 9%Operating grants and contributions 1%Capital grants and contributions 7%Investment income 3%Miscellaneous 5%Investment Income 4%Miscellaneous 1%Charges for services-86%Charges for services 84%13 Financial Analysis of the City's Funds Governmental funds. The focus of the City's governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources.
Such information is useful in assessing the City's financing requirements.
In particular, unreserved ,fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year.The following table summarizes the balance sheet of the City's General Fund, Redevelopment Debt Service Fund, Capital Outlay Fund, Redevelopment Capital Projects Fund, and Total Governmental Funds. As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance related legal requirements.
Redevelopment Redevelopment General Fund Debt Service Capital Outlay Capital Projects 2007 2006 2007 2006 2007 2006 2007 2006 Other Total Governmental Funds Governmental Funds 2007 2006 2007 2006 Total assets Total liabilities
$ 178,892 $202,033 $38,185 $41,302 $ 142,152 $42,494 $ 235,973 $ 66,139 $ 113,655 $216,148 $708,857 $568,116$ 84,126 $ 73,136 $27,457 $26,689 $ 6,952 $ 5,423 $ 35,135 $ 23,715 $ 30,480 $ 55,719 $184,150 $ 184,682 50,631 59,930 10,728 14,613 28,586 8,219 39,846 13,404 29,221 39,560 159,012 135,726 Fund balances Reserved Unreserved:
Designated for economic cont.Designated for future operations Undesignated Total Total liabilities and fund balances 34,000 30,000 10,135 35,487-3,480 -94,766 128,897 10,728 14,613$ 178,892 $202,033 $38,185 $41,302------34,000 30,000 20,751 28,852 154,923 27,571 25,512 94,190 211,321 186,100 85,863 -6,069 1,449 28,442 26,679 120,374 31,608 135,200 37,071 200,838 42,424 83,175 160,429 524,707 383,434$142,152 $42,494 $ 235,973 $ 66,139 $ 113,655 $216,148 $708,857 $568,116 14 As of the end of the current fiscal year, the City's governmental funds reported combined ending fund balances of $708,857, an increase of $140,741 in comparison with the prior year. About 30% of this amount ($159,012) is reserved to indicate funds are not available for new spending because it has already been committed for a variety of restricted purposes.
The remainder of the fund balance is unreserved, meaning it is available for spending at the City's discretion.
Of that amount, $245,321 has been designated for specific capital projects and economic contingencies, leaving $120,374 without a commitment; at June 30, 2006 the comparable amount was $31,608. The increase in Fund balance is due to monies received from bond proceeds that are not committed to specific projects.The General Fund is the principal operating fund of the City. At the end of the current fiscal year, the unreserved fund balance was$44,135, all of which was designated for future operations and economic contingencies, leaving $0 unreserved and undesignated; the comparable number at June 30, 2006 was $3,480. The total fund balance equaled $94,766 at June 30, 2007, a decrease of $34,131 F from the prior year. This decrease was primarily due to increased planned spending for capital projects.The Redevelopment debt service fund has a total fund balance of $10,728 all of which is reserved for the payment of debt service. A net decrease in the fund balance occurred during the current year.Proprietary funds. The City's proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail.Unrestricted net assets of the Electric, Water and Sewer operations at the end of the year amounted to $137,708, $46,950, and $9,534 respectively.
The total growth in net assets for these funds was $13,854, $11,605 and a decrease of $55,182, respectively as a result of routine operations.
15 General-Fund Budgetary Highlights Original Final Actual Variance with Budget Budget Amounts Final Budget Total Revenues $185,707 $197,575 $183.716 $ (13,859)Expend itures: General Government 45,749 81,418 32,883 48,535 Public Safety 162,481 166,899 153,226 13,673 Highways & Streets 18,911 24,594 20,760 3,834 Culture & Recreation 31,922 33,600 27,090 6,510 Debt Service 15.516 16,868 17,612 (744)Total Expenditures 2i74,579 32L3,39 251.571 71,808 Deficiency of Revenue Under Expenditures (88,872) (125,804)
(67,855) 57,949 Other Financing Sources 2984 9,7 3,111,5 Net Change in Fund Balances (59,023) (96,227) (36,724) 59,503 Beginning Fund Balance 131,490i 131,490 131490 _____Ending Fund Balance 2A 242 Final budgeted revenues increased from the amount originally budgeted as a result of grant related programs and financing associated with capital projects.Total budgeted expenditures increased from the amount originally budgeted by 'approximately
$48,000, from $275,000 to $323,000.The reasons for this increase can be generally summarized as follows: " The Development department added appropriations of $3 1,000 for construction costs associated with the Fox Theatre Renovation and the Orange Terrace Library." The Police department added appropriations of $4,400 primarily for grant funded operational charges and the addition of sworn officers.Li The General Services department added appropriations of $3,400 primarily for capital projects and maintenance.
u The Public Works departments added appropriations of $ 6,000 primarily for increased costs associated with programs such as animal control, tree maintenance, and the addition of the photo red light program.16 L3 Other miscellaneous appropriations were added in other departments throughout the year of approximately
$4,700.Actual amounts differed from the Final Fund budget as follows: i -Actual total revenues were less than the amount budgeted due to lower than anticipated development activity within the City resulting in decreased sales and property taxes as well as intergovernmental revenue being under budget due to the timing of receipts for grant funded projects.L Budgeted expenditures exceeded actual amounts by approximately
$72,000. As in prior years, this excess is associated with capital projects not completed at year-end.
Such projects and related amounts are carried over to the next fiscal year.u The net effect of all of the above was a favorable variance from the amounts budgeted of $59,503.Capital Asset and Debt Administration Capital assets. The City's investment in capital assets for governmental and business type activities as of June 30, 2007 amounted to$1,740,842 (net of accumulated depreciation).
This investment includes land, buildings and improvements, machinery and equipment, park facilities, roads, highways, and bridges. The total increase in the City's net investment in capital assets for the current fiscal year was $203,011 ($132,342 for governmental activities including internal service funds and $70,669 for business type activities).
Major capital improvements during the current fiscal year included:
new infrastructure, consisting primarily of street improvements
($66,800);
Magnolia Police Station ($19,600);
Sewer Mains ($7,000);
Electric Utility upgrades ($17,717);
Water Utility upgrades ($11,072) and Fire Station Relocations
($12,500).
Construction in progress totaled $160,938 at June 30, 2007. Some of the major projects in process are the Casa Blanca Energy Demonstration Center, the 230 KV Substation, Mountain View Substation Modernization, Reid Park Improvements, City Hall Improvements, and the Fire Training Facility.
Depreciation expense during the fiscal year was $20,636 for governmental activities and $35,889 for business type activities.
17 City of Riverside's Capital Assets (net of depreciation)
Governmental Activities Business Type Activities Total Land Buildings Improvements other than Buildings Machinery and equipment Infrastructure Construction in progress Total 2007$191,694 72,179 30,792 25,299 407,586 64 986 2006$163,594 49,807 23,587 14,478 353,402 55 326 2007$ 30,413 157,155 648,113 16,673 95,952 2006$ 30,372 159,075 632,265 13,861 42,064 2007$ 222,107 229,334 678,905 41,972 407,586.160,938 2006$ 193,966 208,883 655,852 28,339 353,402 97,390 Additional information on the City's capital assets can be found in note 5 on page 42 of this report.Long-term debt. At the end of the current fiscal year, the City had total debt outstanding of $1,191,237 which includes bonded debt of $1,136,231.
City of Riverside's Long-Term Debt Governmental Activities Business Type Activities Total Lease/Revenue Bonds General Obligation Bonds Pension Obligation Bonds Certificates of Participation Notes Payable Capital Leases Landfill Capping Arbitrage Liability Compensated Absences Water Acquisition Rights Total 2007$296,598 19,331 144,450 192,874 9,759 4,929 34,063 SM70-.04 2006$140,195 19,858 146,470 55,571 10,215 6,008 31,656 2007 2006 2007$474,332 $509,577 $770,930* -19,331 i44,450--092,874.9,211 9,841 18,970 253 317 5,182 3,121 3,444 3,121 1,343 -1,343 S- 34,063 973 979 973$489,233 5215 $191237 2006$649,772 19,858 146,470 55,571 20,056 6,325 3,444 31,656 979 18 m The City's total debt increased by $257,379 (28 percent) during the current fiscal year due to the issuance of $160,507 in Revenue bonds and $139,139 in Certificates of Participation.
The City's Electric Utility maintains "A+" and "AA-" ratings, from Standard & Poors and Fitch, respectively, for their revenue bonds, while the Water Utility maintains "AA" ratings from both rating agencies.
The City's general obligation bond ratings are "AA-" and"AA", respectively.
State statutes limit the amount of general obligation debt a governmental entity may issue to 15 percent of its total adjusted assessed valuation.
The legal debt margin for the City is $451,055, after deducting the general obligation debt of $19,331.Additional information on the City's long-term debt can be found in note 7 beginning on page 43 of this report.Economic Factors and Next Year's Budget and Rates L[ The assessed value for taxable property in the City increased 12.2% between fiscal year 2006 and fiscal year 2007.LI Property taxes increased between fiscal year 2006 and 2007 by 31% primarily as a result of new development, the expansion of redevelopment activity and increased assessed value.LI Unemployment in Riverside County is 6.5% as compared to 5.4% for 2006.LI The required contribution rates as a percentage of payroll for the City's retirement program, including the employee portion which is paid by the City, will be changing effective July 1, 2007 as follows:* Miscellaneous Plan-21.81%
to 21.295%* Safety Plan -28.015% to 28.405%At the time of budget preparation for fiscal year 2008, the economic outlook for the City was considered to be very good. The General Fund Budget for fiscal year 2008 of approximately
$204 million was adopted as balanced, not having to utilize any reserves.19 Request for information This financial report is designed to provide a general overview 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 financial information should be addressed to the City Manager's Office, Finance Division, 3900 Main Street City of Riverside, CA 92522.20 City of Riverside Statement of Net Assets June 30, 2007 (amounts expressed in thousands)
Governmental Business-type Assets Activities Activities Total Cash and investments
$ 210,719 $ 188,816 $ 399,535 Receivables, net 69,821 53,772 123,593 Inventory 5,916 1,061 6,977 Nuclear material inventory
-1,535 1,535 Prepaid items 8,728 6,433 15,161 Deferred charges 130,332 45,385 175,717 Internal balances 9,560 (9,560) -Land and improvements held for resale 40,090 -40,090 Restricted assets: Cash and cash equivalents
-86,260 86,260 Cash and investments at fiscal agent 313,648 79,569 393,217 Other -878 878 Capital leases receivable 26,165 26,165 Land and other capital assets not being depreciated 256,680 126,365 383,04*5 Capital assets (net of accumulated depreciation) 535,856 821,941 1,357,797 Total assets 1,607,515 1,402,455 3,009,970 Liabilities Accounts payable and other current liabilities 46,586 33,568 80,154 Accrued interest payable 10,205 2,781 12,986 Unearned revenue 3,456 1,524 4,980 Deposits 30,737 3,924 34,661 Current liabilities payable from restricted assets -181 181 Claims and judgments payable 27,989 -27,989 Decommissioning liability
-50,606 50,606 Noncurrent liabilities:
Due within one year 23,400 28,507 51,907 Due in more than one year 678,604 460,726 1,139,330 Total liabilities 820,977 581,817 1,402,794 Net Assets Invested in capital assets, net of related debt 712,801 520,059 1,232,860 Restricted for: Expendable:
Capital projects 379,942 -379,942 Debt service 2,660 48,800 51,460 Public works 6,505 3,217 9,722 Low mod housing 25,196 -25,196 Programs -5,596 5,596 Nonexpendable 1,315 i,315 Unrestricted (341,881) 242,966 (98,915)Total net assets $ 786,538 $ 820,638 $ 1,607,176 The notes to the financial statements are an integral part of this statement.
21 City of Riverside Statement of Activities For the fiscal year ended June 30,2007 (amounts expressed in thousands)
Net (Expense)
Revenue and Changes in Net Assets Indirect Expenses Expenses Allocation Program Revenues Operating Charges for Grants and Services Contributions Capital Grants and Contributions Governmental Activities Business type Activities FunctionslPrograms Governmental activities:
General government Public safety Highways and streets Culture and recreation Interest on long-term debt Total governmental activities Business type activities:
Electric Water Sewer Refuse Airport Transportation Public parking Total business type activities Total$ 111,439 114,312 22,556 28,016 26,378 302,701 232,346 42,108 29,510 16,490 1,201 2,831 3,762 328,248$ 630,949$(15,543) $9,875 3,194 2,474 10,245 $12,410 30,563 8,302 6,550 $3,916 65 1,570 1,375 $ (77,726)-(107,861)7,879 12,757.1,303 (19,315)-(26,378)10,557 (218,523)-61,520 12,101 Total$ (77,726)(107,861)12,757 (19,315)(26,378)(218,523)56,323 25,046-(417)(650)5,021 (381)(331)84,611 (133,912)278,888 47,080 24,057 15,833 1,263 302 3,431 370,854$ 432,374 9,781 20,074 5,036 1,939 1,939$ 14,040 7 4,959 209 40,066$ 50,623$ " 56,323 25,046 (417)(650)5,021 (381)(331)84,611 84,611 (218,523)General revenues: Taxes: Sales Property Utility users Franchise Other Intergovernmental, unrestricted Grants and contributions not restricted to specific programs Investment income Miscellaneous Subtotal Transfers, net Total general revenues, special items, and transfers Change in net assets Net assets -beginning
-restated Net assets -ending 55,666 106,114 25,384 5,031 3,581 1,863 29,743 18,582 4,228 250,192 31,171 281,363 62,840 723,698$ 786,538 55,666 106,114 25,384 5,031 3,581 1,863-29,743 16,988 35,570 3,498 7,726 20,486 270,678 (31,171)(10,685) 270,678 73,926 136,766 746,712 1,470,410$ 820,638 $ 1,607,176 The notes to the financial statements are an integral part of this statement., 22 City of Riverside Balance Sheet Governmental Funds June 30, 2007 (amounts expressed in thousands)
Assets Cash and investments Cash and investments at fiscal agent Receivables (net of allowance for uncollectibles)
Interest Property taxes Sales tax Utility billed Accounts Intergovernmental Notes Capital lease receivable Prepaid items Deposits Due from other funds Advances to other funds Land & improvments held for resale Total assets: Liabilities and fund balances Liabilities:
Accounts payable Accrued payroll Retainage payable Intergovernmental Unearned revenue Deposits Due to other funds Advances from other funds Total liabilities:
Fund balances: Reserved Unreserved, designated for economic contingencies Unreserved, designated for future operations General fund Special revenue funds Capital project funds Unreserved, undesignated General fund Special revenue funds Capital project funds Total fund balances Total liabilities and fund balances Redevelopment General Fund Debt Service.$ 82,012 $ 3,631 15,778 -7,495 Capital Outlay$ 22,262 113,048 Redevelopment Capital Projects$ 40,978 147,053 955 16,080 10,221 706 4,140 6,585 70 107 787 382 1,651 4,633 231 115 180 3,933 7,852 4,122 Other Governmental Funds$ 57,558 30,274 660 517 4 3,726 13,839 1 5,988$ 112,567 26,165 691 176 7,435 31,626 2,593$ 178,892$ 38,185-31,509$ 142,152 $ 235,973 Total Governmental Funds$ 206,441 313,648 2,335 16,597 10,221 706 6,697 15,124 17,842 26,165 692 8,028 11,557 31,626 40,090$ 707,769$ 28,254 11,472 5,870 163 61,281 30,737 5,577 39,708 183,062 159,012 34,000 7,288 7,714 193,472 2,847 15,017 105,357 524,707$ 707,769$ 8,064 $11,457 164 163 15,208 30,727 50 18,293 84,126 26 27 763 $ 2,384 13 ,165 1,554 529 --3,001 ,457 6,952$ 14,949 $ 2,094-15 994 4,699 3,882 14,472-10-4,998 15,310 3,104 35,135 29,392 50,631 34,000 7,288 10,728 28,586 20,751 39,846 154,923 29,221 7,714 17,798 15,017 13,425 83,175$ 112,567 2,847 94,766$ 178,892 10,728$ 38,185 85,863 135,200$ 142,152 6,069 200,838$ 235,973 The notes to the financial statements are an intergral part of this statement.
23 CITY OF RIVERSIDE RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET ASSETS June 30, 2007 (amounts expressed in thousands)
Total fund balances -governmental funds $524,707 Amounts reported for governmental activities in the Statement of Net Assets are different because: Capital assets net of accumulated depreciation used in governmental activities that are not current financial resources and, therefore, are not reported in the funds. 788,346 Issuance costs from issuing debt are expenditures at the fund level but are deferred and subject to capitalization and amortization in the Statement of Net Assets. 9,021 Pension contributions were expenditures at the fund level but are deferred as a net pension asset and subject to capitalizaton and amortization in the Statement of Net Assets. 119,668 Revenues that do not meet the "availability" criteria for revenue recognition and therefore, are deferred in the funds. 57,825 Long-term liabilities, as listed below, are not due and payable in the current period and therefore are not reported in the funds.Bonds Payable $ (451,949)Accrued Interest Payable (10,205)Certificates of Participation Payable (192,874)Notes Payable (9,759)Capital Leases Payable (4,929)Bond Premiums (8,431)Compensated Absences (33,488)(711,635)Internal service funds are used by management to charge the costs of insurance, centralized purchasing and fleet management to individual funds. The assets and liabilities of the internal service funds are included in the governmental activities in the Statement of Net Assets. (1,394)Net assets of governmental activities
$786,538 24 City of Riverside Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds For the fiscal year ended June 30, 2007 (amounts expresed in thousands)
Revenues Taxes Licenses and permits Intergovernmental Charges for services Fines and forfeitures Special assessments Rental and investment income Miscellaneous Total revenues Expenditures Current: General government Public Safety Highways and Streets Culture and Recreation Capital Outlay Debt service: Principal Interest Bond issuance costs Total expenditures Excess (deficiency) of revenues over (under) expenditures Other financing sources (uses): Transfers in Transfers out Issuance of bonds Premiums on bonds issued Sales of capital assets Total other financing sources and uses Net Change in fund balances Fund balances -beginning, as restated Fund balances -ending R General Fund$ 135,390 $7,821 12,069 11,903 2,559 3,963 6,827 3,184 183,716 32,883 153,226 20,760 27,090 5,826 11,786 251,571 (67,855)32,656 (1,922)397 31,131 (36,724)131,490 94,766 $edevelopment Debt Service 39,811 200 3,820 393 44,224 Capital Outlay Redevelopment Capital Projects Other Governmental Funds$$$21,434 15,930 5,163 13,989 242 Total Governmental Funds$ 191,131 12,984 47,934 11,914 2,778 6,170 22,587 6,164 301,662 1,784 3,112 417 26,747 3,925 74 4,241 423 4,903 2,096 42,734 3,194 728 9,764 28,964 4,844 9,359 37,438 51,413 153,226 20,760 36,449 117,070 50,668 5,559 7,856 805 17,414 26,810 11,673 (45,782)1,390 2,024 (30,695)(3,885)14,613 10,728 51,396 (24,649)28 122,276 186 288 122,778 98,129 37,071$ 135,200 38,728 (34,487)45,782 (9,214)154,880 2,213 (760)192,901 158,414 42,424$ 200,838 660 1,688 1,746 55,735 (13,001)2,562 (4,612)16,644-32 616 15,242 2,241 80,934$ 83,175 12,045 21,330 2,551 414,844 (113,182)92,701 (61,530)295,190 4,455 541 331,357 218,175 306,532$ 524,707 The notes to the financial statements are an integral part of this statement.
25 CITY OF RIVERSIDE RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES For the year ended June 30, 2007 (amounts expressed in thousands)
Net change in fund balances-total governmental funds $218,175 Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures.
However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlays exceeded depreciation in the current period, as listed below: Capital Asset additions
$ 158,436 Depreciation Expense (19,817) 138,619 Revenues in the statement of activities that do not meet the "availability" criteria for revenue recognition and therefore are not reported as revenue in the funds. 6,005 The amortization of the net pension asset reported in the statement of activities does not require the use of current financial resources and, therefore, is not reported as an expenditure in the governmental funds. (651)The issuance of long-term debt (e.g., bonds, leases, notes) provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net assets. Also, governmental funds immediately report the effect of issuance costs, premiums, discounts and similar items when debt is first issued, whereas these amounts are deferred and amortized in the statement of activities.
The net effect of these differences in the treatment of long-term debt and related items is listed below: Principal repayments 12,045 Deferred Charges 5,152 Compensated Absences (2,475)Interest (6,990)Premiums on the issuance of LTD (4,455)Proceeds from LTD (295,190)
(291,913)Internal service funds are used by management to charge the costs of insurance, centralized purchasing and fleet management to individual funds. The net revenue of certain activities of internal service funds is reported with governmental activities.
(7,395)Change in net assets of governmental activities
$ 62,840 The notes to the financial statements are an integral part of this statement.
26 City of Riverside Statement of Revenues, Expenditures and Changes In Fund Balances -Budget and Actual General Fund For the year ended June 30, 2007 (amounts expressed In thousands)
Budgeted Amounts Actual Variance with Original Final Amounts Final Budget Budgeted Amounts Actual Variance with Original Final Amounts Final Budget Revenues Taxes Licenses and permits Intergovernmental Charges for services Fines and forfeitures Special assessments Rental and investment income Miscellaneous
$ 141,917 8,402 13,001 11,116 2,355 3,905 3,197 1,814$ 141,917 8,402 18,921 11,441 4,639 3,905 4,389 3,961$ 135,390 7,821 12,069 11,903 2,559 3,963 6,827 3,184$ (6,527)(581)(6,852)462 (2,080)58 2,438 (777)Public safety: Police Fire Animal regulation Building and zoning inspection Street lighting Total public safety Highways and streets 87,760 63,642 2,967 4,043 4,069 162,481 90,681 64,572 3,534 4,043 4,069 166,899 86,197 57,049 2,670 3,243 4,067 153,226 4,484 7,523 864 800 2 13,673 18,911 24,594 20,760 3,834 31,922 33,600 27,090 6,510 Total revenues 185,707 197,575 183,716 (13,859) Culture and recreation Expenditures General government:
Mayor Council Manager Attorney Clerk Community Development Human Resources General Services Information System Development Subtotal Allocated expenditures Total general government 574 130 16,137 78 184 11,736 4,542 29,210 14,809 4,661 574 130 17,540 78 344 12,127 4,640 32,583 14,841 34,873 527 0 15,502 60 180 10,716 3,828 18,049 14,348 6,195 47 130 2,038 18 164 1,411 812 14,534 493 28,678 Debt service: Principal Interest Total debt service Total expenditures 4,560 10,956 15,516 5,826 11,042 16,868 5,826 11,786 17,612 0 (744)(744)274,579 323,379 251,571 71,808 Deficiency of revenue under expenditures (88,872) (125,804)
(67,855) 57,949 82,061 117,730 69,405 48,325 (36,312) (36,312) (36,522) 210 45,749 81,418 32,883 48,535 continued Other financing sources (uses)Transfers in Transfers out Sale of capital assets Total other financing sources Net change in fund balances Fund balance, beginning 31,321 (1,572)100 29,849 (59.023)31,399 (1,922)100 29,577 (96,227)32,656 (1,922)397 31,131 (36,724)1,257 0 297 1,554 59,503 131,490 131,490 131,490 0$ 72,467 $ 35,263 $ 94,766 $ 59,503 The notes to the financial statements are an integral part of this statement.
Fund balance, ending 27 City of Riverside Statement of Net Assets Proprietary Funds June 30, 2007 (amounts expressed in thousands)
Business-type Activities
-Enterprise Funds Other Enterprise Funds Total Enterprise Funds Governmental Activities-Internal Service Funds Assets Current assets: Cash and investments Receivables (net allowances for uncollectibles)
Interest Utility billed Utility unbilled Accounts Intergovernmental Nuclear materials inventory Inventory Prepaid items Due from other funds Restricted assets: Cash and cash equivalents Cash and investments at fiscal agent Public benefit programs receivable Conservation
& reclamation programs receivable Total current assets Non-current assets: Advances to other funds Deferred charges Capital assets: Land Buildings Accumulated depreciation-buildings Improvements other than buildings Accumulated depreciation-improvements other than buildings Machinery and equipment Accumulated depreciation-machinery and equipment Construction in progress Total non-current assets Total assets Electric Water Sewer$ 105,388 $ 40,127 $ 34,002$ 9,299 $ 188,816 $1,311 13,492 14,238 7,964 295 1,535 6,430 50 63,749 71,519 766 286,737 399 2,558 2,732 1,390 448 2 185 596 817 1,066 1,061 1 4,127 111 548 644 395 4,583 2,006 17,194 18,431 10,815 5,326 1,535 1,061 6,433 50 4,278 246 32 21 5,916 8 15,148 8,050 112 70,966 3,236 86,260-'79,569 766 112 18,816 418,374 3,669 27,670 20 6,841* 7,049 15,287 (3,635)621,436 (250,370)17,769 (12,132)57,308 484,051 770,788 9,892 14,799 (2,857)339,087 (105,030)9,741 (6,303)27,067 293,257 364,223 41,855 22,104 3,828 2,698 180,254 (65,719)48,059 (8,919)7,027 (4,676)713 185,369 227,224 7,046 10,774 22,050 (3,024)7,178 (3,328)13,594 (8,348)10,864 56,806 75,622 25,793 45,385 10,501 17,079 1,643 30,413 232,390 (75,235)1,015,760 (367,647)48,131 (31,459)95,952 1,019,483 1,437,857 1,488 (92)10,122 (7,328)22,912 33,413 continued 28 City of Riverside Statement of Net Assets Proprietary Funds June 30, 2007 (amounts expressed in thousands)
Business-type Activiftfes
-Enterprise funds Other Enterprise Electric Water Sewer Funds Liabilities Current Liabilities:
Accounts payable Accrued payroll Retainage payable Intergovernmental Claims and judgments Unearned revenue Deposits Due to other funds Capital leases-current Water stock acquisitions-current Landfill capping -current Current liabilities payable from restricted assets: Revenue bonds Accrued interest Other payables Total current liabilities Non-current liabilities:
Revenue bonds Arbitrage payable Notes payable Capital leases Advances from other funds Decommissioning liability Water stock acquisitions Landfill capping Total non-current liabilities Total liabilities Net Assets Invested in capital assets, net of related debt Restricted for debt service Restricted for other purposes Restricted for programs Unrestricted Total net assets Total Enterprise Funds Governmental Activities-Internal Service Funds 12,098 5,942 3,508 8 2,580 3,901 1,959 423 112 1,343 2,044 1,472 94 210 42 1,097 1,022 1,202 1 2,898 17 19,140 10,395 4,025 8 1,524 3,924 2,898 59 150 300 809 592 27,989 3,132 150 300 19,460 1,851 180 45,627 334,751 927 13,390 50,606 399,674 445,301 4,355 318 12,561 90,745 416 5,761 823 97,745 110,306 193,589 12,525 853 46,950$ 253,917 3,515 612 7,989 6,537 21,506 9,211 28 3,685 166 9,669 27,330 2,781 180 72,714 447,002 1,343 9,211 194 32,505 50,606 823 2,821 544,505 617,219 517,548 65,333 3,217 9,197 225,343$ 820,638 132,605 46,830 8,344 137,708$ 325,487 34,430 42,419 169,293 5,978 9,534$ 184,805 2,821 12,656 19,193 22,061 3,217 31,151$ 56,429 32,522 2,285 2,285 34,807 4,190 (5,584)$ (1,394)The notes to the financial statements are an integral part of this statement.
29 City of Riverside Statement of Revenues, Expenses, and Changes in fund Net Assets Proprietary Funds For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Business-type Activities
-Enterprise Funds Operating revenues: Charges for services Operating expenses: Personal services Contractual services Maintenance and operation General Materials and supplies Insurance Depreciation and amortization Total operating expenses Operating income (loss)Nonoperating revenues (expenses):
Operating grants Interest income Other Gain (loss) on retirement of capital assets Capital improvement fees Interest expense and fiscal charges Q Total non-operating revenues (expenses)
Income before capital contributions and transfers Capital contributions Transfers in Transfers out Change in net assets Total net assets -- beginning Total net assets -- ending Electric$ 278,888 17,274 4,370 158,230 16,110 529 395 20,836 217,744 61,144 11,118 1,351 485 (14,602)(1,648)59,496 9,781 (27,393)41,884 ,283,603$ 325,487 Water Sewer$ 47,080 $ 24,057 7,528 2,137 9,007 10,293 658 233 7,783 37,639 9,441 2,931 1,062 (74)(4,469)(550)8,891 20,074 (3,928)25,037 228,880$ 253,917 8,406 780 7,349 3,839 1,955 276 5,333 27,938 (3,881)2,439 16 (38)5,014 (1,572)5,859 1,978 22 2,000 182,805$ 184,805 Other Enterpri Funds$ 2 2 (3 se 0,829 Total Enterprise Funds$ 370,854 6,055 39,263 4,444 11,731 6,139 180,725 4,164 34,406 842 3,984 193 1,097 2,137 36,089 3,974 307,295 3,145) 63,559 1,939 1,939 500 16,988 738 3,167 (42) 331-5,014 (310) (20,953),825 6,486 (320) 70,045 5,175 35,052 150 150-(31,321)5,005 73,926 1,424 746,712 6,429 $ 820,638 Governmental Activities-Internal Service Funds$ 14,148 3,122 130 1,445 2,030 380 14,859 819 22,785 (8,637)1,283 48 (10)(79)1,242 (7,395)(7,395)6,001$ (1,394)2 5$ 5 30 City of Riverside Proprietary Funds Statement of Cash Flows For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Cash flows from operating activities:
Cash received from customers and users Cash paid to employees for services Cash paid to other suppliers of goods or services Other receipts Net cash provided (used) by operating activities Cash flows from noncapital financing activities:
Transfers in Transfers out Operating grants Advances from interfund receivables Payments on interfund receivables Advances to other funds Net cash provided (used) by noncapital financing activities Cash flows from capital and related financing activities:
Purchase of capital assets Purchase of nuclear fuel Proceeds from the sale of capital assets Principal paid on long-term obligations Interest paid on long-term obligations Capital improvement fees Capital contributions Net cash used for capital and related financing activities Cash flows from investing activities:
Purchase of investments Income from investments Net cash provided by investing activities Net change in cash and cash equivalents Cash and cash equivalents, ending (including
$69,801 for Electric,$29,327 for Water and $3,993 for Sewer in restricted accounts)Cash and cash equivalents, ending (including
$53,166 for Electric,$15,148 for Water and $4,127 for Sewer in restricted accounts)Electric$ 271,148 (18,591)(174,648)1,351 81,260 (27,393)(144)(27,537)(43,733)(632)555 (18,815)(14,656)6,263 (71,018)(5,371)12,051 6,680 (10,615)169,169 158,554 Water$ 48,527 (7,681)(21,510)1,062 20,398 Sewer$ 23,181 (8,366)(13,904)23 934 Other Enterprise Funds$ 20,559 (6,004)(15,620)738 (327)150 (3,928)8 (62)(3,982)(25,469)103 (4,305)(3,445)5,611 (27,505)(4)3,276 3,272 (7,817)63,092$ 55,275 12,710 (2,044)10,666 (11,974)4 (3,959)(1,687)5,014 22 (12,580)2,702 2,702 1,722 2,765 5,912 (1,229)7,598 (8,220)(20)(310)819 (7,731)544 544 84 Total Enterprise Funds$ 363,415 (38,642)(225,682)3,174 102,265 150 (31,321)2,765 5,912 12,718 (3,479)(13,255)(89,396)(632)66U (27,099)(20,098)5,014 12,715 (118,834)(5,375)18,573 13,198 (16,626)281,119$ 264,493 Governmental Activities-Internal Service Funds$ 14,519 (3,175)(11,508)51 (113)(16,771)(16,771)(1,457)(79)(1,536)1,310 1,310 (17,110)21,388$ 4,278 continued 36,407 12,451$ 38,129$ 12,535 31 City of Riverside Proprietary Funds Statement of Cash Flows For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Other Enterprise Funds Total Enterprise Funds continued Governmental Activities-Internal Service Funds Electric Reconciliation of operating income (loss) to net cash provided (used) by operating activities:
Operating Income (loss) $ 61,144 Other receipts 1,351 Adjustments to reconcile operating income to net cash provided (used) by operating activities:
Depreciation and amortization 20,836 Amortization of pension costs 87 Amortization (burn) of nuclear fuel 4,456 (Increase) in utility billed receivables (1,249)(Increase) in utility unbilled receivables (1,687)(Increase) decrease in accounts receivable (5,256).(Increase) decrease in intergovernmental receivables 603 (Increase) decrease in prepaid items 121 (Increase) in nuclear materials inventory (Increase) decrease in inventory (160)Increase (decrease) in accounts payable Increase (decrease) in accrued payroll (3,059)Increase (decrease) in retainage payable 596 Increase in intergovernmental receivables 165 Increase (decrease) in deferred revenue (64)Increase (decrease) in deposits (Decrease) in due to other funds (151)Increase in claims and judgments Increase in decommissioning liabilitity 3,527 (Decrease) in landfill capping _Water Sewer$9,441 1,062 7,783 38 (840)(178)2,128 (342)366 1,110 (191)79 (1)(57)$(3,881)16 5,333 24 (41)(18)(890)73 2 (508)726 16 75 7$(3,145)738 2,137.14 (96)(12)(189)29$63,559 3,167$(8,637)32 479 35 6 36,089 163 4,456 (2,226)(1,895)(4,207)363 489 (508)(160)479 (1,188)421 319 (58)6 (208)3,527 (323)$ 102,265$ 18,051 819.9 (21)412 (1)1,227 (595)(62)(1,301)8,005$ (113)$(323)Net cash provided by operating activities Schedule of noncash financing and investing activities:
Contribution in aid$ 81,260$ 3,518$ 20,398 $ 934 $ (327)$ 14,462 $ 22 $ 49 The notes to the financial statements are an integral part of this statement.
32 City of Riverside Statement of Fiduciary Net Assets Fiduciary Fund June 30, 2007 (amounts expressed in thousands)
Assets: Cash and investments Cash and investments at fiscal agent Interest receivable Property tax receivables Total assets Liabilities:
Accounts payable Held for bond holders Total liabilities Agency Funds$ 11,187 9,161 108 418$ 20,874$ 11 20,863$ 20,874 The notes to the financial statements are an integral part of this statement 33 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
- 1. Summary of Significant Accounting Policies The City of Riverside (City) was incorporated on October 11, 1883 as a Charter City and operates under a Council-Manager form of Government.
The more significant accounting policies reflected in the financial statements are summarized as follows: A. Reporting Entity These financial statements present the City and its component units, entities for which the City is financially accountable.
Blended component units are legally separate entities, but in substance are part of the City's operations and their data is combined with that of the City's. The City has no component units that meet the criteria for discrete presentation.
All of the City's component units have a June 30 year end.Blended Component Units Riverside Redevelopment Agency (Redevelopment Agency) was established in 1971 by the City. The Redevelopment Agency's primary purpose is to eliminate blighted areas in the City by encouraging commercial development.
City Council members serve as the Redevelopment Agency's directors and have full accountability for fiscal matters.Riverside Public Financinq Authority (Public Financing Authority) was organized in December 1987 by the City and the Redevelopment Agency.The purpose of the Public Financing Authority is to provide financing for public capital improvements to the City or the Redevelopment Agency. City Council members serve as the Public Financing Authority's directors and have full accountability for fiscal matters.Riverside Municipal Improvements Corporation (Municipal Improvements Corporation) was created in 1978 and operates under provisions of the Nonprofit Public Benefit Corporation Law of the State of California.
The Municipal Improvements Corporation's primary purpose is to provide financing assistance by obtaining land, property and equipment on behalf of the City. Three members of the City Council serve as the Municipal Improvements Corporation's directors and have full accountability for fiscal matters.Complete financial statements for each of the individual component units except the Riverside Municipal Improvement Corporation (which does not generate a financial statement) may be obtained from the City's Finance Department, 3900 Main Street, Riverside, California, 92522.B. Government-wide and Fund Financial Statements The government-wide financial statements (i.e., the statement of net assets and the statement of activities) report information on all of the nonfiduciary activities of the City and its component units. Interfund activity has been removed from these statements except for utility, charges, as this would distort the presentation of function costs and program revenues.Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business type activities, which rely to a significant extent on fees and charges for support.The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues.Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues.
Indirect expenses are allocated to the various functions based on a proportionate utilization of the services rendered.
Such allocations consist of charges for accounting, human resources, information technology and other similar support services.Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements.
Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements.
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting for the proprietary fund financial statements.
Agency funds report only assets and liabilities, therefore have no measurement focus. Revenues are recorded when earned and expenses are recorded when a liability is incurred, 34 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS.
For the year ended June 30, 2007 (amounts expressed in thousands) regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied on the property.
Grants and similar items are recognized as revenue as soon as all eligibility requirements have been met. An allowance for doubtful accounts is maintained for the utility and other miscellaneous receivables.
Agency funds report only assets and liabilities, therefore have no measurement focus.Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting.
Revenues are recognized as soon as they are both measurable and available.
Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the government considers revenues to be available if they are collected within 60 days of the end of the current fiscal period, except for grant revenue which is (6) months and sales tax revenue which is seven (7) months, as described below. Grant revenue is recognized if received within six (6) months of year end to enable the matching of revenue with applicable expenditures.
Expenditures generally are recorded when a liability is incurred, as under accrual accounting.
However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due.Effective with the previous fiscal year, the State temporarily began to exchange 25% of sales taxes for an equal amount of property taxes to*securitize a short-term State bond issue. The State bond issue will remain outstanding for an uncertain number of years, but is currently estimated not to exceed eight (8) years. These in-lieu sales taxes will be paid to the City by the State on a different calendar than sales taxes, which are paid monthly, three months in arrears. The vast majority of the in-lieu amount will be paid during the applicable fiscal year; however, the final payment of the in-lieu.sales taxes will not be paid until the January following the end of the applicable fiscal year. The City has budgeted this final payment in the current fiscal year and will continue this practice during this temporary period, effectively extending the availability period to seven (7) months for the in-lieu sales taxes and thus provide consistency in the reporting of sales tax revenue.Property taxes, special assessments, sales taxes, franchise taxes, licenses, charges for services, amounts due from other governments and interest associated with the current fiscal period are all considered to be susceptible to accrual. Other revenue items such as fines and permits are considered to be measurable and available only when the government receives cash, and are therefore not susceptible to accrual.The government reports the following major governmental funds: The General fund is the government's primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund.The Redevelopment Agency's debt service fund accounts for the resources accumulated and payments made for principal and interest on long-term obligation debt of the Redevelopment Agency.The Capital Outlay fund accounts for the construction and installation of street and highway capital improvements for the City, including improvements funded by the 1/2 % sales tax approved by Riverside County in 1988.The Redevelopment Agency's capital project fund for the acquisition, relocation, demolition and sale of land for those portions of the City designated to be in need of redevelopment activities.
The government reports the following major proprietary funds: The Electric fund accounts for the activities of the City's electric distribution operations.
The Water fund accounts for the activities of the City's water distribution operations.
The Sewer fund accounts for the activities of the City's sewer systems.Additiohally, the government reports the following fund types: Internal service funds account for the central stores, central garage, and the three self-insured risks of workers compensation, unemployment and public liability on a cost reimbursement basis.The agency (fiduciary) fund is used to account for special assessments that service no-commitment debt.35 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
The permanent fund is a governmental fund that is used to report resources that are legally restricted to the extent that only earnings, and not principal, may be used for purposes that support the City's Library programs.
Restricted for other purposes on the Statement of Net Assets includes $1 million of permanent fund principal which are considered nonexpendable net assets.Pronouncements regarding accounting and financial reporting issued by the Financial Accounting Standards Board prior to December 1, 1989 generally are followed in both the government-wide and proprietary fund financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board.Governments also have the option of following subsequent private-sector guidance for their business-type activities and enterprise funds, subject to this same limitation.
The City has elected not to follow subsequent private-sector guidance.Significant interfund activity has been eliminated from the government-wide financial statements with the exception of charges between the City's electric, water, sewer and refuse functions and various other functions of the City. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned.
Amounts reported as program revenues include 1) charges to customers for goods, services, or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments.
Internally dedicated resources are reported as general revenues rather than as program revenues.
Likewise, general revenues include all taxes.Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations.
The sewer fund also recognizes as operating revenue the portion of connection fees intended to recover the cost of connecting new customers to the system. Operating expenses for enterprise funds and internal service funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses.D. Cash and Investments The City values its cash and investments in accordance with the provisions of Government Accounting Standards Board (GASB) Statement No. 31,"Accounting and Financial Reporting for Certain Investments and External Investment Pools (GASB 31)," which requires governmental entities, including governmental external investment pools, to report certain investments at fair value in the statement of net assets/balance sheet and recognize the corresponding change in the fair value of investments in the year in which the change occurred.
Fair value is determined using published market prices.Cash accounts of all funds are pooled for investment purposes to enhance safety and liquidity while maximizing interest earnings.
Investments are stated at fair value. All highly liquid investments (including restricted assets)with a maturity of 90 days or less when purchased are considered cash equivalents.
Cash and investments held on behalf of proprietary funds by the City Treasurer are considered highly liquid and are classified as cash equivalents for the purpose of presentation in the Statement of Cash Flows: E. Restricted Cash and Investments Certain proceeds of Enterprise fund revenue bonds, as well as certain resources set aside for their repayment, are classified as restricted assets on the statement of net assets because their use is limited by applicable bond covenants.
Additionally, unspent proceeds received from the City's landfill capping surcharge are also recorded as restricted assets.F. Land and Improvements Held for Resale Land and improvements held for resale are generally acquired under Developer Disposition Agreements in the normal course of Redevelopment Agency activity.
The Developer Disposition Agreements provide for transfer of property to developers after certain redevelopment obligations have been fulfilled.
Additionally, the General fund has acquired property which is to be held for resale at a later date. This property is carried at cost until an event occurs to indicate a lower net realizable value.G. Inventory Supplies are valued at-cost using the average-cost method. Costs are charged to user departments when consumed rather than when purchased.
36 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
H. Prepaid Items Payments to vendors for services benefiting future periods are recorded as prepaid items and expenditures are recognized when items are consumed.I. Capital Assets and Nuclear Fuel Capital Assets Capital assets,- which include property, plant, equipment, and infrastructure assets ( e.g., roads, bridges, sidewalks, right of way, and similar items), are reported in the applicable governmental or business-type activities columns in the government-wide financial statements.
The government defines capital assets as assets with an initial, individual cost of more than five thousand dollars and an estimated useful life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed.
Costs include: labor; materials; interest during construction; allocated indirect charges such as engineering, construction and transportation equipment, retirement plan contributions and other fringe benefits.
Donated capital assets are recorded at estimated fair market value at the date of donation.The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized.
Capital assets other than land are depreciated using the straight-line method.Nuclear Fuel The Electric Utility amortizes the cost of nuclear fuel to expense using the "as burned" method. In accordance with the Nuclear Waste Disposal Act of 1982, the Electric Utility is charged one dollar per megawatt-hour of energy generated by the City's share of San Onofre Nuclear Generating Station's Units 2 and 3 to provide for estimated future storage and disposal of spent fuel. The Electric Utility pays this fee to its operating agent, Southern California Edison Company, on a quarterly basis.J. Compensated Absences City employees receive 10 to 25 vacation days a year based upon length of service. A maximum of two years' vacation accrual may be accumulated and unused vacation is paid in cash upon separation.
City employees generally receive one day of sick leave for each month of employment with unlimited accumulation.
Upon retirement or death, certain employees or their estates receive a percentage of unused sick leave paid in a lump sum based on longevity.
The General, Library, Redevelopment Agency Capital Projects and the Housing and Community Development Special Revenue funds have been used'to liquidate such balances.The liability associated with these benefits is reported in the government-wide statements.
Vacation and sick leave of proprietary funds is recorded as an expense and as a liability of those funds as the benefits accrue to employees.
K. Long-Term Obligations Long-Term Debt in the government-wide financial statements and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type statement of net assets. Bond premiums and discounts, as well as issuance costs, are classified as deferred charges and amortized over the life of the bonds using the effective interest method.Bonds payable are reported net of the applicable bond premium or discount.In the fund financial statements, government fund types recognize bond issuance costs as expenditures during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuance are reported as other financing uses.Decommissioning Federal regulations require the Electric Utility to provide for the future decommissioning of its ownership share of the nuclear units at San Onofre.The Electric Utility established a trust account to accumulate resources for the decommissioning of the nuclear power plant and restoration of the beachfront at San Onofre. Each year the Electric Utility recognizes an expense in the amount of the contribution to the trust account. The funding will occur over the useful life of the generating plant.37 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
Amounts held in the trust account are classified as restricted assets in the accompanying balance sheet. To date, the Electric Utility has set aside$50,606 in cash and investments with the trustee as Riverside's estimated share of the decommissioning cost of San Onofre. Based on a cost estimate completed by Southern California Edison and approved by the California Public Utilities Commission, the Electric Utility plans to set aside approximately
$1,600 per year to fund this obligation.
Decommissioning is expected to commence around the year 2014.L. Claims and Judgments Payable Claims and judgments payable are recognized when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated.
Such claims, including an estimate for claims incurred but not reported at year end, are recorded as liabilities in the appropriate internal service fund.M. Fund Equity In the fund financial statements, reserves represent those portions of fund equity not available for appropriation or legally segregated for a specific future use. Designated fund balances represent amounts identified by management or the governing board for the future use of financial resources.
N. Net Assets Net assets represent the difference between assets and liabilities.
Net assets invested in capital assets, net of related debt, consists of capital assets, net of accumulated depreciation, reduced by the outstanding balances of any borrowings used for the acquisition, construction or improvement of those assets. Net assets invested in capital assets, net of related debt excludes unspent debt proceeds.
Net assets are reported as restricted when there are limitations imposed on their use either through legislation adopted by the City or through external restrictions imposed by creditors, grantors or laws or regulations of other governments.
Restricted resources are used first to fund appropriations.
- 0. Interfund Transactions Interfund transactions are accounted for as revenues and expenditures or expenses.
Transactions, which constitute reimbursements, are eliminated in the reimbursed fund and accounted for as expenditures or expenses in the fund to which the transaction is applicable.
During the year, transactions occur between individual funds for goods provided or services rendered.
Related receivables and payables are classified as "due from/to other funds" on the accompanying fund level statements.
The noncurrent portion of long-term interfund loans receivable are reported as interfund receivables/payables and, for governmental fund types, are equally offset by a fund balance reserve to indicate that the receivable does not constitute available expendable financial resources.
Interfund payables also include accrued interest, which has been offset by deferred revenue.Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as "internal balances".
P. Unearned Revenues Governmental -and proprietary funds report unearned revenue on the statement of net assets. Unearned revenues arise in governmental funds when potential revenue does not meet both the "measurable" and "available" criteria for recognition in the current period. Unearned revenues also arise when the government receives resources before it has a legal claim to them, as when grant monies are received prior to meeting all eligibility requirements.
in subsequent periods, when both revenue recognition criteria are met, or when the government has a legal claim to the resources, revenue is recognized.
The majority of the City's governmental fund unearned revenue for June 30, 2007 relates to unearned revenue on a capital lease.See Note 4.Q. Property Tax Calendar Under California law, general property taxes are assessed for up to 1% of the property's assessed value. General property taxes are collected by the counties along with other special district taxes and assessments and voter approved debt. General property tax revenues are collected and pooled by the county throughout the fiscal year and then allocated and paid to the county, cities and school districts based on complex formulas prescribed by State statutes.38 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
Property taxes are calculated on assessed values as of January 1 for the ensuing fiscal year. On July 1 of the fiscal year the levy is placed and a lien is attached to the property.
Property taxes are due in two installments.
The first installment is due November 1 and is delinquent on December 10. The second installment is due February 1 and is delinquent on April 10. Property taxes receivable represent current and prior years' uncollected tax levies, adjusted for uncollectable amounts.R. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenditures.ISpecifically, the City has made certain estimates and assumptions relating to the revenues due and expenditures incurred through fiscal year end, collectability of its receivables, the valuation of property held for resale, the useful lives of capital assets, and the ultimate outcome of claims and judgments.
Actual results may differ from those estimates and assumptions.
S. Implementation of new accounting principles GASB has issued two pronouncements prior to June 30, 2007 (for years ending after June 30, 2007) that have effective dates that may impact future financial presentations.
Management has currently determined that GASB No. 45, "Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions" and GASB No. 47,"Accounting for Termination Benefits" apply to the City, and are currently evaluating the impacts of implementing the pronouncements.
- 2. Legal Compliance
-Budgets Budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America. Annual appropriated budgets are adopted for all departments within the general, special revenue and capital project funds. Formal budgets are not employed for debt service funds because debt indenture provisions specify payments.
The permanent fund is not budgeted.During the period December through February of each fiscal year, department heads prepare estimates of required appropriations for the following fiscal year. These estimates are compiled into a proposed operating budget that includes a summary of proposed expenditures and financial resources and historical data for the preceding fiscal year. The operating budget is presented by the City Manager to the City Council for review. Public hearings are conducted to obtain citizen comments.
The City Council generally adopts the budget during one of its June meetings.
The City Manager is legally authorized to transfer budgeted amounts between divisions and accounts within the same .department.
Transfer of appropriations between departments or funds and increased appropriations must be authorized by the City Council. Expenditures may not legally exceed budgeted appropriations at the departmental level within a fund. All appropriations shall lapse at the end of the fiscal year to the extent they have not been expended or lawfully encumbered, except for appropriations for capital projects which shall continue to their completion.
- 3. Cash and Investments Cash and investments at fiscal year end consist of the following:
Investments Investments at fiscal agent Cash on hand and in transit$392,505 504,455 896,960 2,400$89,36 The amounts are reflected in the government-wide statement of net assets: Cash and investments Restricted cash and cash equivalents Restricted cash and investments at fiscal agent Total per statement of net assets Fiduciary fund cash and investments
$399,535 86,260 393,217 879,012 20,348 1899.3-60 The City follows the practice of pooling cash and investments of all funds except for funds required to be held by outside fiscal agents under the provisions of bond indentures, which are administered by outside agencies.39 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
Interest income earned on pooled cash and investments is allocated monthly to funds based on the beginning and month-end balances.
Interest income from cash and investments held at fiscal agents is credited directly to the related account. Bank deposits are covered by federal depository insurance for the first $100 or by collateral held in the pledging bank's trust department in the name of the City.Authorized Investments Under provisions of the City's investment policy, and in accordance with California Government Code Section 53601, the City Treasurer may invest or deposit in the following types of investments:
investments of debt proceeds held by bond fiscal agents. Permitted investments are specified in related trust agreements and include the following:
Securities of the U.S. Government and its sponsored agencies Bankers' Acceptances rated in the single highest classification Commercial Paper rated in the single highest classification Investments in money market funds rated in the single highest classification Municipal obligations rated Aaa/AAA or general obligations of states with ratings of at least A2/A or higher by both Moody's and S&P Investment Agreements No maximum percentage of the related debt issue or maximum investment in one issuer is specified.
Disclosures Relatinq to Interest Rate Risk Securities of the U.S. Gov't.and its sponsored agencies Repurchase Agreements Reverse Repurchase Agreements Negotiable Certificates.
of Deposit Bankers Acceptances Commercial Paper of "prime" quality Local Agency Investment Fund (State Pool)Mutual Funds Medium-Term Corporate Notes Max Maturity 5 Years 1 Year 90 Days 5 Years 180 Days 270 Days N/A N/A 5 Years Max % of Portfolio 100%100%20%30%40%25%100%20%30%Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment.
Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. The City's investment policy requires that the interest rate risk exposure be managed by purchasing a combination of shorter term and longer term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time as necessary to provide the cash flow and liquidity needed for operations.
Information about the sensitivity of the fair values of the City's investments (including investments held by fiscal agent) to market interest rate fluctuations is provided by the following table that shows the distribution of the City's investments by maturity: Investments in Medium Term Corporate Notes may be invested in securities rated A or better by Moody's or Standard and Poor's rating services and no more than 15% of the market value of the portfolio may be invested in one corporation.
The City's investment policy provides two exceptions to the above; one is for investments authorized by debt agreements (described below) and the other for funds reserved in the San Onofre Nuclear Generating Station Decommissioning Account for which the five-year maturity limitation may be extended to the term of the operating license.Investments Authorized by Debt Agqreements Provisions of debt agreements, rather than the general provisions-of the California Government Code or the City's investment policy, govern 40 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
Remaining Maturity (in Months) --12 Months 13 to 24 25 to 60 More than Investment Type or Less Months Months 60 Months any one issuer that represent 5% or more of total City investments are as follows: Money Market Funds Federal Agency Securities Corp Medium Term Notes State Investment Pool Held by Fiscal Agent Money Market Funds Investment Contracts Corp Med Term Notes Commercial Paper Fed Agency Securities Total$31,239 240,712 19,654 100,900 33,514 391,335 984 26,973 51 649$896.960$31,239 49,650 100,900 33,514 59,028.984 24,539 19,904$319758$ -34,455 19,654 166,216 1,697$222.022$ -156,607 118,210 2,434 9,224$issuer FHLB Investment Type Federal Agency Securities Reported Amount$158,386 47,881 20,824 168.2O5 The City assumes that callable investments will not be called.Disclosures Relatinq to Credit Risk Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment.
This is measured by the assignment of a rating by a nationally recognized statistical rating organization.
Presented below is the actual rating as of year-end for each investment type: Custodial Credit Risk Custodial credit risk for deposits is the risk that, in the event of the failure of a -depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The City's investment policy requires that a third party bank trust department hold all securities owned by the City. All trades are settled on a delivery vs. payment basis through the City's safekeeping agent. The City has no deposits with financial institutions; bank balances are swept daily into a money market account.Investment in State Investment Pool The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California.
The fair value of the City's investment in this pool is reported in the accompanying financial statements at amounts based upon the City's pro-rata share of the fair value provided by LAIF for the entire LAlF portfolio (in relation to the amortized cost of that portfolio).
The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis.4. Capital Lease Receivable The Redevelopment Agency has a direct financing lease arrangement with the State of California (the State) for a twelve-story office building.
The lease term is for thirty years and the State takes ownership of the facility at the conclusion of that term. The lease calls for semi-annual payments not less than the debt service owed by the Redevelopment Agency on the lease Rating as of Year End Investment Type Money Market Funds Federal Agency Securities Corp Medium Term Notes State Investment Pool Held by Fiscal Agent Money Market Funds Investment Contracts-Corp Med Term Notes Commercial Paper Fed Agency Securities Total AAA Aa A-1 Unrated$31,239 240,712 19,654 100,900 33,514 391,335 984 26,973 51,649$ -240,712 33,514 984 51,649 s717.32$16 19,654$ $31,239 100,900-391,335 26,973$20522 $26 1152-39 Concentration on Credit Risk The investment policy of the City contains no limitations on the amount that can be invested in any, one issuer beyond that stated above. Investments in 41 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 14 ; +k 4 Beinig I HIJjU"0IV AIJI OOQ II LI IIUOOI UO revenue bonds issued for the purchase and renovation of the building.
The future minimum lease payments to be received are as follows: 2008 2009 2010 2011 2012 Thereafter Total Due Less: amount applicable to interest Total capital lease receivable
$ 2,298 2,324 2,355 2,381 2,413 45,968 (19,803)$26,165 Business type activities:
Capital assets, not being depreciated:
Land Construction in progress Total capital assets not being depreciated Capital assets being depreciated:
Buildings Improvements other than Buildings Machinery and Equipment Total capital assets being depreciated Less accumulated depreciation for: Buildings Improvements other than Buildings Machinery and Equipment Total accumulated depreciation Total capital assets being depreciated, net Business type activities capital assets, net Balance$ 30,372 Deletions/
Ending Additions Transfers Balance$44 $ (3) $30,413 103,01 (49,113) 9,5 103,045 (49,116) -126,365 228,937 3,452 1 232,390 973,640 43,336 (1,216) 1,015,760 43,65' ,21 (1,729) 48,131 1,246,222 53,003 (2,944) 1,29,28 5. Capital Assets The following is a summary of changes in the capital assets during the fiscal year ended June 30, 2007.(69,862) (5,375)2 (75,235)(341,375)(29,784)(44 1,021)(27,249)(3,265)(35,889)977 1,591 (367,647)(31,458)(474,340)82,41 80,21 171144 Governmental activities:
Capital assets, not being depreciated:
Land Construction in progress Total capital assets not being depreciated Capital assets being depreciated:
Buildings Improvements other than Buildings Machinery and Equipment Infrastructure Total capital assets being depreciated Less accumulated depreciation for: Buildings Improvements other than Buildings Machinery and Equipment Infrastructure Total accumulated depreciation Total capital assets being depreciated, net Governmental activities capital assets, net Beginning Balance Deletions/
Ending Additions Transfers Balance S877,637 $120,159 S(990 948306$163,594 '$34,265 5536 4,3$(6,165) $191,694 (36,573) 6498 Estimated useful lives used to compute depreciation are as follows: 218,90 8049 (42.738)77,724 24,139 51,619 57,114 9,035 15,469 66,801 (4,774)101,863 60,654 67,809 Buildings and Improvements Improvements other than Buildings Machinery and Equipment Infrastructure 30-50 years 20-99 years 3-15 years 20-1 00 years 707,513 115,444 (4.774) 818,183 (27,917) (1,767)(28,032)(42,636)(167,654)(266,239)(1,830)(4,422)(12.6 17)(20,636)4,548 (29,684)(29,862)(42,510)(1 80,271)(282,327)Depreciation expense was charged to functions of the government as follows: Governmental activities:
General government
$ 2,307 Public safety 2,378 Highways and streets, including depreciation of general infrastructure assets 13,401 Culture and recreation2,5 Total depreciation expense -governmental activities
$206-36 441,27 9480 (226) 53,5$6601945150 426 $253 42 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
Business type activities:
Electric Water Sewer Refuse Special Transportation Airport Public Parking Total depreciation and amortization expense -business type activities
$20,836 7,783 5,333 892 385 221 439$35.889 Unpaid Claims, June 30, 2005 Incurred claims Claim payments Unpaid Claims, June 30, 2006 Incurred claims (including IBNR's)Claim payments Unpaid claims, June 30, 2007 Workers'Compensation
$11,147 8,176 (5,589)13,734 14,251 (8,298)Unemployment Compensation Public Liability Total$ 76 $6,326 $17,549-4,657 12,833-(4,809) (10398)76 6,174 19,984-7,432 21,683 S5,380) (13,678)$76 $8,226 S-U27~6. Risk Management The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters.
Property insurance coverage has a limit of $100,000, with a-deductible of $50. Earthquake and flood insurance coverage has a limit of $15,000, with a deductible of 5% for earthquake and 2% for flood.Workers' compensation insurance coverage has a limit of $25,000, with a deductible of $3,000 per occurrence.
The City carries commercial insurance up to $23,000 for general and auto liability claims greater than $3,000 per occurrence.
There were no claims settled in the last three fiscal years that exceed insurance coverage.
Internal service funds have been established to account for and finance the uninsured risks of loss.All funds of the City participate in the Risk Management program and make payments to the Internal Service Funds based on actuarial estimates of the amounts needed to fund prior and current year claims and incidents'that have been incurred but not reported.
Interfund premiums are accounted for as quasi -external transactions and are therefore recorded as revenues of the Internal Service funds in the fund financial statements.
Changes in the funds' claims. liability amounts are:$19687 7. Long-Term Obligations Changes in Long-Term Obligations:
The following is a summary of changes in long-term obligations during the fiscal year: Governmental Activities:
Beginning Balance Due Ending Within Additions Reductions Balance One Year Redevelopment Agency bonds General Obligation Bonds Pension Obligation Bonds Certificates of Participation Capital leases Notes Payable Compensated.
Absences Total$140,195 $160,507$4,104 $296,598 $4,145 19,858 146,470 55,571 6,008 10,215 527 19,331 2,020 144,450 545 2,480 1,870 1,656 517 139,139 1,103 1,836 2,182 456 192,874.4,929 9,759$0319656 15,185 12,778 34$063 123187 43 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
Business-type activities:
Revenue Bonds Notes Payable Capital Leases Landfill Capping Arbitrage Liability Water Stock Acquisition Rights Total Beginning Balance$509,577 9,841 317 3,444 979$524-158 Additions Reductions
$ $35,245 630 64 323 1,343 -Ending Balance$474,332 9,211 253 3,121 1,343 Due Within One Year$27,330 642 85 300 6 973 150 f27.671 $ $28,507$75,405 2003 Electric Revenue Bonds; 2.0% to 5.0%, due in annual installments from $1,035 to $8,535 through October 1, 2013.$27,500 2004 Electric Revenue Bonds; Series A fixed rate bonds, 4.0% to 5.25%, due in annual installments from $2,615 to $3,695 through October 1, 2014.$82,500 2004 Electric Revenue Bonds; Series B Auction Rate Securities, variable rate subject to weekly repricing (rate at June 30, 2007 was 3.7%), due in annual installments from $1,250 to $7,000 through October 1, 2029.$115,725 2005 Electric Refunding/Revenue Bonds;Series A and B; Auction Rate Securities, variable rate subject to weekly repricing (rate at June 30, 2007 was 3.7%), due in annual installments from $600 to $10,375 through October 1, 2035.24,885 Principal Outstanding 53,880 Advance Refunding:
In prior years the City defeased certain Revenue and Tax Allocation Bonds.by placing the proceeds of the new bonds in an irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in the City's financial statements.
At fiscal year end $62,735 of bonds outstanding are considered defeased.82,500 Longq-Term Obligations at June 30, 2007: Subtotal.Principal Outstanding 115,125 352,830 7,469 (6,087)$360,299 Revenue Bonds: Add: Unamortized bond premium Less: Unamortized deferred bond refunding costs Electric$98,730 1998 Electric Revenue Bonds (partial refunding issue); $63,165 serial bonds, 4.25% to 5.38%, due in annual installments from $4,650 to$7,085 through October 1, 2013; $35,565 term bonds, 5%, dueOctober 1, 2022 (partially advance refunded in 2005).$47,215 2001 Electric Revenue Bonds; 2.9% to 5.25%, due in annual installments from $2,855 to $4,750 through October 1, 2016 (partially advance refunded in 2005).Water.$47,315$69,840 1991 Water Revenue Bonds; $25,050 serial bonds, 4.25%to 9.0%, due in annual installments from$675 to $3,100 through October 1,2002; $25,900 Capital Appreciation Bonds, due in annual installments from $3,235 to $3,240 from October 1, 2003 to October 1,2010; (partially advance refunded in 1998)$12,950 29,125 44 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
Principal Outstandingq Electric Utility Fund Water Utility Fund$30,965 1998 Water Revenue Bonds (partial refunding issue); $15,055 serial bonds, 4.0% to 5.38%, due in annual installments from $205 to $4,055 through October 1, 2013; $15,910 term bonds, 5%, due October 1, 2027$20,000 2001 Water Revenue Bonds; 2.6% to 5.0%, due in annual installments from $345 to $1,230 through October 1, 2031 (partially advance refunded in 2005)$61,125 2005 Water Refunding/Revenue Bonds;Auction Rate Securities, variable rate subject to weekly repricing (rate at June 30, 2007 was 3.6%), due in annual installments from $400 to $3,950 through October 1, 2035 Subtotal Less: Unamortized bond discount Less: Unamortized deferred bond refunding costs 20,990 4,850 Fiscal Year 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2027 2028-2032 2033-2036 Premium (Discount)
Total Fiscal Year 2008 2009 2010 2011 2012 2013 Premium Total Principal$19,460 20,345 21,300 22,295 21,050 86,690 41,490 38,575 42,275 39,350 Interest$ 13,602 12,735 11,781 10,810 9,744 35,085 23,520 16,388 9,587 2,366 Total$ 33,062 33,080 33,081 33,105 30,794 121,775 65,010 54,963 51,862 41,716 Principal$4,355 4,375 4,415 4,465 4,590 22,310 11,430 14,025 15,700 13,850 Interest$3,194 3,153 3,109 3,063 3,110 11,338 7,889 5,806 3,447 890 Total$ 7,549 7,528 7,524 7,528 7,700 33,648 19,319 19,831 19,147 14,740 7469 7469 (1906)$360.299 $145618 505,917 $97609-9 (1.906)S44999 1142608 Principal$ 3,515 3,760 4,020 4,305 4,520 4,745 156$2S5021 Sewer Utility Fund Interest$1,346 1,092 819 571 350 119 54.297 Total$4,861 4,852 4,839 4,876 4,870 4,864 156 5293L18 99,515 (1,906)(2,510)$97,609 Sewer Principal Redevelopment Agency Bonds: Outstanding
$49,145 1993 Sewer Revenue Refunding Serial Bonds;4.0% to 7.0%, due in annual installments from $335 to$4,745 through August 1, 2012 Add: Unamortized bond premium$ 24,865 156 25,021 1482.9-29 Total Revenue Bonds$13,285 1991 Public Financing Authority Revenue Bonds, Series A, Multiple Project Areas; $1,470 serial revenue bonds 7.15% to 7.6%, due in annual installments from $100 to $145 through February 1, 2003; and $4,175 term bonds, 8.0%, due in annual installments from $155 to $450 through February 1, 2018 (portion not refunded)$17,025 1999 University Corridor/Sycamore Canyon Merged Project Area, Tax Allocation Bonds, Series A;$6,205 serial bonds, 3.4% to 4.7% due in annual installments from $40 to $570 through August 1, 2014;$4,810 term bonds at 4.75% due August 1, 2021; and$6,010 term bonds at 5.0% due August 1, 2027$ 180 Remaining revenue bond debt service payments will be made from revenues of the Electric, Water, and Sewer Utility Enterprise funds. Annual debt service requirements to maturity are as follows: 14,750 45 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
$6,055 1999 University Corridor/Sycamore Canyon Merged Project Area, Subordinate Tax Allocation Bonds, Series B; $1,900 serial bonds, 4.5% to 5.5%due in annual installments from $35 to $190 through September 1, 2013; $1,135 term bonds at 5.5% due September 1, 2018; and $3,020 term bonds at 5.625%due September 1, 2027$20,395 1999 Casa Blanca Project Area, Tax Allocation Bonds, Series A; $8,925 serial bonds, 3.4%to 4.7% due in annual installments from $455 to $780 through August 1, 2014; $2,565 term bonds at 4.75%due August 1, 2017; $4,035 term bonds at 4.75% due August 1,2021; and $4,870 term bonds at 5.0% due August 1, 2025.$4,550 Arlington Redevelopment Project, 2004 Tax Allocation Bonds, Series A; $420 term bonds at 3.8%due August 1, 2014; $615 term bonds at 4.6% due August 1, 2024; and $3,515 term bonds at 4.7% due August 1, 2034$2;975 Arlington Redevelopment Project, 2004 Tax Allocation Bonds; Series B: 5.5% due in annual installments from $85 to $235 through August 1, 2024$26,255 State of California Department of General Services Project, 2003 Lease Revenue Refunding Bonds, Series A; 2.0%/o to 5.0% due in annual installments from $545 to $2,230 through October 1, 2024$4,810 State of California Department of General Services Project, 2003 Lease Revenue Refunding Bonds, Series B; $310 serial bonds 1.20% to 1.42%through October 1, 2004; $620 term bonds at 3.090%due Oct. 1, 2008; $1,110 term bonds at 4.340% due Oct. 1, 2014 and $2,770 term bonds at 5.480% due Oct. 1, 2024 Principal Outstandinq 5,315 16,865 4,475 2,800 23,740$40,435 Downtown/Airport Merged Project Area, 2003 Tax Allocation and Refunding Bonds; $32,720 serial ,bonds 2.0% to 5.25% due in annual installments from$1,220 to $1,955 through August 1, 2023; and $7,715 term bonds at 5.0% due in annual installments from$195 to $2,060 through August 2034$24,115 2005 Housing Set-Aside Tax Allocation Bonds;$17,025 serial bonds 3.0% to 4.625% due in annual installments from $505 to $1,165 through August 1, 2025; $2,425 term bonds at 5.0% due August 1, 2028;and $4,665 term bonds at 4.85% due August 1, 2034$1,465 California Statewide Communities Development Authority 2005 Taxable Revenue Bonds, Series A (CRA/ERAF Loan Program);
3.87% to 5.01% due in annual installments of $105 to $180 through August 1, 2015$8,340 Downtown/Airport Merged Project Area and Casa Blanca Project Area 2007 Tax Allocation Bonds, Tax Exempt, Series A, serial bonds 4.0% to 4.25% due in annual installments from $20 to $590,000 through August 1, 2025; $4,980 term bonds at 4.5% due August 1, 2029; $410 term bonds at 4.375% due August 1, 2037$14,850 Downtown/Airport Merged Project Area and Casa Blanca Project Area 2007 Tax Allocation Bonds, Taxable, Series B, $4,050.term bonds at 5.2% due August 1, 2017; $10,800 term bonds at 5.8% due August 1, 2028 Principal Outstanding 36,680 23,045 1,360 8,340 14,850 4,200 46 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
$89,205 University Corridor/Sycamore Canyon Merged Project Area, Arlington Project Area, Hunter Park/Northside Project Area, Magnolia Center Project Area, and La Sierra/Arlanza Project Area 2007 Tax Allocation Bonds, Tax-Exempt, Series C, serial bonds 4.0% to 5.0% due in annual installments from $50 to$3,210 through August 1, 2025; $17,955 term bonds at 4.5% due August 1, 2030; $47,775 term bonds at 5.0%due August 1, 2037$43,875 University Corridor/Sycamore Canyon Merged Project Area, Arlington Pfoject Area, Hunter Park/Nort&side Project Area, Magnolia Center Project Area, and La Sierra/Arlanza Project Area 2007 Tax Allocation Bonds, Taxable, Series D, $15,740 term bonds due August 1, 2017; $28,135 term bonds due August 1,2032 Subtotal Add: Unamortized bond premium Total Redevelopment Agency Bonds, Remaining debt service will be paid by the Redevelopment Service Funds from future property tax revenues.
Annual requirements to maturity are as follows;Principal Outstanding Principal OutstandinQ General Obligation Bonds:$20,000 Fire Facility Projects, Election of 2003 General Obligation Bond; 3.0% to 5.5%, due in annual installments from $410 to $1,740 through August 1, 2024 Add; Unamortized bond premium Total General Obligation Bonds$19,075 256$19.331 89,205 43,875 289,680 6,918$296.598 Agency Debt debt service Remaining general obligation bond debt service payments will be made from Unrestricted revenues of the General fund. Annual debt service requirements to maturity are as follows: Fiscal Year 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2025 Premium Total Principal$ 545 590 625 675 725 4,525 6,450 4,940 256$1 9.331 Interest$ 1,109 1,130 1,155 1,183 1,212 6,597 7,908 4.683$24.977 Total$1,654 1,720 1,780 1,858 1,937 11,122 14,358 9,623 256$44.308 Fiscal Year 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2027 2028-2032 2033-2037 2038-2042 Premium Total Principal$ 4,145 6,250 6,625 6,925 7,235 41,395 54,585 63,035 49,025 43,685 6,775 6,918$296.598 Interest$12,585 13,931 13,670 13,380 13,071 61,397 50,746 41,885 37,746 26,262 3,997$288-670 Total$16,730 20,181 20,295 20,305 20,306 102,792 105,331 104,920 86,771 69,947 10,772 6,918$585.268 47 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
Pension Obligation Bonds: Principal Outstanding Principal Certificates of Participation:
Outstanding
$89,540 California Statewide Community Development Authority (Public Safety) 2004 Taxable Pension Obligation Bond; 2.65%)to 5.896%, due in annual installments from $1,125 to $10,715 through June 1, 2023$30,000 2005 Taxable Pension Obligation Bonds Series A; 3.85% to 4.78%, due in annual installments
$630 to $3,860 through June 1,2020$30,000 2005 Taxable Pension Obligation Bonds Series B (Auction Rate Securities);
variable rate subject to weekly repricing (rate at June 30, 2007 was 5.3%), due in annual installments from $1,475 to $6,750 through June 1, 2025.Total Pension Obligation Bonds$85,765 28,685 30,000$144,450$6,360 1999 Municipal Improvements Corporation Certificates of Participation; 6.0% to 7.6%, due in annual installments from $310 to $815 through April 1, 2010$53,185 2003 Riverside Public Financing Authority Certificates of Participation; 2.0% to 5.0%, due in annual installments from $755 to $2,830 through September 1,2033$19,945 2006 Galleria at Tyler Public Improvements Certificates of Participation; 4.0% to 4.5%, due in annual installments from $435 to $735 through September 1, 2024$59,475 Riverside Renaissance Certificates of Participation Series 2007A; variable rate subject to weekly repricing (rate at June 30, 2007 was 3.7%), due in annual installments from $1,350 to $3,350 through March 1,2037$59,500 Riverside Renaissance, Certificates of Participation Series 2007B; variable rate subject to weekly repricing (rate at June 30, 2007 was 3.7%) due--in annual installments from $1,350 to $3,350 through March 1, 2037 Subtotal Add: Unamortized bond premium Total Certificates of Participation
$ 2,280 50,200 19,945 Remaining pension obligation bond debt service payments will be made from unrestricted revenues of the General fund. Annual debt service requirements to maturity are as follows: Fiscal Year 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2025 Total Principal$ 2,480 2,985 3,535 4,130 4,780 35,565 61,635 29,340$144.450 Interest$ 7,642 7,539 7,406 7,241 7,042 30,802 18,551 2,483 Total$ 10,122 10,524 10,941 11,371 11,822 63,367 80,186 31,823 59,475 59,500 191,400 1,474$1 92.874 Remaining certificates of participation debt service payments will be made from unrestricted revenues of the Debt Service funds. Annual debt service requirements to maturity are as follows: 48 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
Fiscal Year 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2027 2028-2032 2033-2037 Premium Total Principal$1,870 1,950 2,045 1,275 4,500 25,355 30,755 35,820 42,495 42,655 1,474$192874 Interest$ 7,445 7,360 7,260 7,124 6,977 32,214 26,877 20,287 12,667 3,946$132.157 Total$9,315 9,310 9,305 11,099 11,477 57,549 57,632 56,107 55,162 46,601 1,474$325-031 Note payable to California Housing Finance Agency, interest at 3%, payable in annual installments of $88 through 2013, for housing projects.Total notes payable -Redevelopment Agency Outstanding 477$-9.759 Remaining notes payable debt service payments will be made from unrestricted revenues of the Redevelopment Agency. Annual debt service requirements to maturity are as follows: Principal Outstanding Contracts
-Enterprise Funds: Water stock acquisition rights payable on demand to various water companies Notes Payable -Redevelopment Agency: Fiscal Year 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2027 2028-2032 Total Redevelopment Agency Principal Interest$ 517' $ 744 552 711 593 675 638 635 685 592 3,437 1,656 1,281 1,293 777 933 1,279 430$9.759 $7.668 Total$ 1,261 1,263 1,267 1,274 1,277 5,092 2,575 1,709 1,709$17.4-27$973 Principal Outstanding These notes payable have been issued to promote development and expansion within the City's redevelopment areas.Pepsi Cola Bottling Company of Los Angeles, 10.5%, payable in net annual installments of $341, including principal and interest through June 2020 HUD Section 108 loan for University Village, 5.36% to 7.66%, payable in semi-annual installments beginningAugust 1, 1996 of$272 to $425 through August 1, 2015 HUD Section 108 loan for Mission Village Project, 6.15% to 6.72%, payable in semi-annual installments beginning August 1, 1999 of $110 to $420 through August 1, 2018 Principal Outstanding Notes payable -Sewer Fund:$2,987 2,700 Sewer fund loan from State of California for Cogeneration project, 2.336%, payable in net annual installments of $339,474, beginning January 29, 2003 through January 29, 2022 Sewer fund loan from State of California for Headworks project, 1.803%, payable in net annual installments of$477,387, beginning November 6, 1999 through November 6, 2018$ 4,088 Total notes payable -Sewer Fund$9-211 3,595 49 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
Remaining notes payable debt service payments will be made from unrestricted revenues of the Sewer fund. Annual debt service requirements to maturity are as follows: The future minimum lease obligations as of June 30, 2007 were as follows: Fiscal Year 2008 2009 2010 2011 2012 2013-2017 2018-2021 Total Principal$ 642 654 6666 679 692 3,659.2 20$9.211 Sewer Fund Interest$175 163 151 138 125 426 92$1.270 Total$ 817 817 817 817 816 4,084 2,313 t104-81 Years Ending June 30, 2008 2009 2010 2011 2012 Total Minimum lease payments Less: Amount representing interest (rates ranging from 2.5% to 9%)Total capital lease payable Governmental Activities
$1,749 1,520 848 809 474 5,400 Business-type Activities
$ 92 75 51 51_0 269 (471)$4929 (16)$253 Capital Leases: The City leases various equipment through capital leasing arrangements in the governmental and proprietary fund types. These activities are recorded for both governmental and business-type activities in the government-wide financial statements.
The assets and related obligations under leases in governmental funds are not recorded in the fund statements.
For proprietary funds, the assets and their related liabilities are reported directly in the fund.Amortization applicable to proprietary assets acquired through capital lease arrangements is included with depreciation for financial statement presentation.
The assets acquired through capital leases are as follows: The following are legally required debt service cash reserves.
These amounts, at a minimum, are held by the City or fiscal agents at June 30, 2007: General lonq-term obligations:
Redevelopment Agency Certificates of Participation Total$ 7,033 5,486 112 -519$30,108 9,427$39535 Enterprise funds: Electric Water Total Asset Buildings Equipment Subtotal Less: Accumulated Depreciation Total Governmental Activities
$8,660 61519 15,179 Business-Type Activities
$868 868 Following are required debt service ratios for the year ended June 30, 2007.The ratio measures operating income in relation to debt service. The City is in compliance with these ratios, except for the Sewer fund. The Sewer fund has not raised sewer rates in over 20 years. Management is in the process of preparing a rate increase that is anticipated to be approved by City Council by fiscal year 07/08.(2,217)12a9_62 (167)$70 Electric fund Water fund Sewer fund Minimum Debt Service Ratio Required 1.10 1.25 1.25 50 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
There are also a number of limitations and restrictions contained in Assessment Bond indentures.
The City believes they are in compliance with all significant limitations and restrictions.
Landfill Capping: State and Federal laws and regulations require the City to place a final cover on all active landfills when closed and to perform certain maintenance and monitoring functions at the landfill site for 30 years after closure. To comply with-these laws and regulations, the City is funding the costs of closure and"final capping" of the Tequesquite landfill located in the City. This area, comprised of approximately 120 acres, operated as a "Class II Sanitary Landfill" until its closure in 1985. During its operation, the landfill did not accept hazardous waste and no clean up and abatement or cease and desist orders have been issued to the City. The capacity used at June 30, 2007 was 100%.The estimated costs as determined by an independent consultant and updated by the City's Engineering Department are associated with flood control upgrades, remediation of possible ground water contamination and control of methane gas. All potential costs have been recognized in the financial statements.
There is the potential for these estimates to change due to inflation, deflation, technology, or change in laws or regulations.
To fund the cost, the City imposed a landfill capping surcharge on customers effective August 1, 1988. The minimum unamortized estimated cost of$4,559 is recorded as a deferred charge in the accompanying financial statements of the Refuse fund and is being amortized on a straight-line basis over the remaining post closure period, currently 23 years. The estimated cost of meeting the State's requirements was increased by $2.2 million during 2002 based on the engineer's annual review of closure and post-closure maintenance costs.8. Other Long-Term Obligations Assessment Districts Bonds (Not obligations of the City)As of June 30, 2007, the City has several series of Assessment District Bonds outstanding in the amount of $74,508. Bonds issued for improvements in certain special assessment districts, in accordance with the provisions of the Municipal Improvements Acts, are liabilities of the property owners and are secured by liens against the assessed property.
The City Treasurer acts as an agent for the property owners in collecting the assessments, forwarding the collections to bondholders and initiating foreclosure proceedings, if applicable.
Since the debt does not constitute an obligation of the City, it is not reflected as a long-term obligation of the City and is not reflected in the accompanying basic financial statements.
Conduit Debt Obligations Mortgage Revenue Bonds outstanding of $16,975 and industrial Development Revenue Bonds of $11,275 are not included in the accompanying financial statements.
These bonds are special obligations of third parties and payable solely from and secured by a pledge of the receipts received from the acquired mortgage loans and certain other reserve funds and related monies. The bonds are not payable from any other revenues or assets of the City or Redevelopment Agency. Neither the faith and credit nor the taxing power of the City, the Redevelopment Agency, the State of California or any political subdivision thereof is pledged to the payment of the principal and interest on the bonds.9. Interest Rate Swaps on Revenue Bonds Objective:
As a means to lower borrowing costs, when compared against fixed-rate bonds at the time of issuance in September 2005, the City entered into interest rate swap agreements in connection with its $115,725 2005 Electric Refunding/Revenue Bonds (Series A and B) and $61,125 2005 Water Refunding/Revenue Bonds. Also in September 2005, the City entered into the interest rate swap agreement for the $82,500 2004 Electric Revenue Bonds (Series B). The intention of the swap was to effectively change the City's variable interest rate on the bonds to a synthetic fixed rate of 3.11% for the 2004 Electric Revenue Bonds (Series B) and 3.20% for the other respective Revenue Bonds. In March 2007, the City entered into additional interest rate swap agreements in connection with its $59,475 2007 Series A Certificates of Participation, and its $59,500 2007 Series B Certificates of Participation.
Terms: Under the swaps, the City pays the counterparty a fixed payment as noted above and receives a variable payment computed as 62.68% of the London Interbank Offering Rate ("LIBOR")
one month index plus 12 basis points. The swaps have notional amounts equal to the principal amounts stated above. Starting in fiscal year 2007, the notional value of the swaps and the principal amounts of the associated debt decline by $300 to $7,000 until the debt is completely retired in fiscal year 2036. The bonds' variable rate coupons are established on a weekly basis through the results of an 51 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 For he yar ededJune30.
007(amonts enx~nrecsced in thousa~nds' auction process administered through an auction agent, termed Auction Rate.Securities
("ARS").The bonds and the related swap agreements for the 2004 Electric Revenue Bonds mature on October 1, 2029 and the 2005 Electric and Water Refunding/Revenue Bonds both mature .on October 1, 2035. The 2007 Series A and B Certificates of Participation mature on March 1, 2037. As of June 30, 2007 rates were as follows: Interest rate Swap: Fixed payment to counterparty V Variable payment from counterparty Net interest rate swap payments Variable-rate bond coupon payments Synthetic interest rate on bonds Terms Fixed 63.00 LIBOR+ 7 bps ARS COP 2007A TIE Floating Bonds Rates 3.396%(3.42160%)
(.0256%)3.60767%3.5820Z%COP 2007B TIE Floating Bonds Rates 3.396%(3.42160%)
(.0256%)3.63165%3-00%Interest rate Swap: Fixed payment to counterparty Variable payment from counterparty Net interest rate swap payments Variable-rate bond coupon payments Synthetic interest rate on bonds Terms Fixed 62.68 LIBOR+ 12 bps ARS 2005 Water Refunding/
Revenue Bonds Series A Rates 3.2000%(3.26362%)
(.06362%)3.12994%2005 Electric Refunding/
Revenue Bonds Series B Rates 3.2040%(3.37995%)
(.17595%)3.25034%_3.gZ439%2005 Electric Refunding/
Revenue Bonds Series A Rates 3.2010%(3.35345%)
(.15245%)3.22244%136299%2004 Electric Revenue Bonds Series B Rates 3.1110%(3.22906%)
(.11806%)3.10258%:iB5%Fair Value: As of June 30, 2007, in connection with all swap arrangements, the transactions had a total positive fair value of $17,816. Because the coupons on the City's variable-rate bonds adjust to changing interest rates, the bonds do not have a corresponding fair value decrease.
The fair value was developed by a pricing service using the zero-coupon method. This method calculates the future net settlement payments required by the swap, assuming that the current forward rates implied by the yield curve correctly anticipate future spot interest rates. These payments are then discounted using the spot rates implied by the current yield curve for hypothetical zero-coupon bonds due on the date of each future net settlement of the swap.Credit risk: As of June 30, 2007, the City was exposed to credit risk in the amount of $17,816 because the swap had a positive fair value. The swap counterparties, Bear Stearns and Merrill Lynch were rated A+ and AA-, respectively by Standard & Poor's. To mitigate the potential for credit risk, if either counterparties's credit quality falls below A-, the fair value of the swap will be collateralized by the counterparty with U.S. Government securities.
Collateral would be posted with a third-party custodian.
Basis risk: As noted above, the swaps expose the City to basis risk should the relationship between LIBOR and the auction-rate converge, changing the synthetic rate on the bonds. If a change occurs that results in the rates'moving to convergence, the expected cost savings may not be realized.Termination risk: The derivative contract uses the international Swap Dealers Association Master Agreement, which includes standard termination events, such as failure to pay and bankruptcy.
The Schedule to the Master Agreement includes an "additional termination event." That is, a swap may be terminated by the City if either counterparty's credit quality falls below"BBB-" as issued by Standard and Poor's. The City or the counterparty may terminate a swap if the other party fails to perform under the terms of the Interest rate Swap: Fixed payment to counterparty Variable payment from counterparty Net interest rate swap payments Variable-rate bond coupon payments Synthetic interest rate on bonds* Terms Fixed 62.68 LIBOR+ 12 bps ARS 52 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands) contract.
If a swap is terminated, the.variable-rate bond would no longer carry a synthetic interest rate. Also, if at the time of termination a swap has a negative fair value, the City would be liable to the counterparty for a payment equal to the swap's fair value.Swap payments and associated debt: As of June 30, 2007, the debt service requirements of the variable-rate debt and net swap payments assuming current interest rates remain the same, for their term are summarized as RDA RDA Debt Capital Capital follows. As rates vary, variable-rate bond interest payments payments will vary.and net swap Reserved for: Encumbrances Interfund receivable Debt service Prepaid items Notes receivable Fire bond Capital Assets Total reserved fund balance General$ 13,803 31,627 691 70 1,847 2,593$ 50,631 2,333 Service Outlay$ -$ 28,586 Projects$ 8,046 291 Variable-Rate Bonds Fiscal Year Ending June 30 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2027 2028-2032 2032-2037 Total Principal$ 950 975 1,000 3,725 6,200 53,700 67,400 74,600 84,225 84,550 1377,3-25 Interest$ 8,056 8,026 7,995 11,602 11,408 52,862 42,676 31,083 18,709 4$658$197.0_75 Interest Rate Swaps, Net$ (164)(163)(163)(236)(160)(742)(590)(420)(246)(53)$ (2.937)--31,509$ 2,333 $ 28,586 $ 39,846 Total$ 8,842 8,838 8,832 15,091 17,448 105,820 109,486 105,263 102,688 86,155$571.463 11. Interfund Assets, Liabilities and Transfers Due From/To Other Funds: These balances resulted from expenditures being incurred prior to receipt of the related revenue source.The following table shows amounts receivable/payable between funds within the City at June 30, 2007: Receivable Fund General 10. Reserved Fund Balances: Payable Fund Nonmajor governmental funds Central stores *Non Major Governmental Redevelopment Debt Service Amount$4,303 3,132 7,435 Reserved fund balances at June 30, 2007 for the Redevelopment Debt Service Fund, Capital Outlay Redevelopment Debt Service Fund consist of the following:
General Fund, Fund and the Redevelopment Capital Projects 3,593 529 4,122 Electric General 50$11,607 Total* Internal service funds 53 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
Advances To/From Other Funds: These balances consist of advances used to fund capital projects in advance of related financing/assessments and for other long-term borrowing purposes.The following table'shows amounts advanced from funds within the City to other funds within the City at June 30, 2007: Transfers In/Out: Transfers are used to (1) move revenues to the fund that statute -or budget requires to expend them, (2) move receipts restricted to debt service from the funds collecting the receipts to the debt service fund as debt service payments become due, (3) move the remaining fund balances of closed funds to the General fund and (4) use unrestricted revenues collected in the General fund to finance various programs accounted for in the other funds in accordance with budgetary operations.
The following table shows amounts transferred to/from funds within the City as of June 30, 2007: Receivable Fund General Payable Fund Electric Water Sewer Nonmajor governmental Funds Nonmajor enterprise funds Workers' compensation
- Central stores *Central garage *Electric Water Sewer General Central Stores*General Amount$13,390 5,761 3,685 4,350 2,805 242 253 1,140 31,626 3,019 650 3,669 20 15,253 3,001 3,850 22,104 10,367 3,697 3,015 6,712$4ZJ4_,U_General Transfer In Fund Workers' compensation*
Liability Insurance Trust*Transfer Out Fund Electric Water Special Designation Special Capital Imlmrovement General Nonmajor governmental funds Nonmajor enterprise funds Nonmajor governmental funds Nonmajor governmental funds Nonmajor enterprise funds Amount$27,393 3,928 1,257 78 32,656 200 200 3,207 8,466 11,673 RDA Special Revenue RDA Debt Service RDA Capital Projects Library CDBG Community Dev COPS-2006 General Fund RDA Special Revenue RDA Capital Projects RDA Debt Service General Fund RDA Capital Projects RDA Rehabilitation COPS Debt Service 1,572 748 24320 42 42 28 28 150 150$92.851 Total Refuse General Fund* Internal service funds Total 54 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
- 12. Deficit Fund Balances/Net Assets 14. City Employees Retirement Plan Deficit fund balance/net assets exist in the Workers Compensation
($6,493), and the Public Liability
($806) funds at fiscal year end. The deficit in these funds will be reduced based on a rate increase implemented in the subsequent fiscal year. Management's analysis shows that continuing cost control together with the rate increase will eliminate these deficits over the next few years.13. Litigation 7 The City is a defendant in various lawsuits arising in the normal course of operations.
City management, based in part on the opinion of outside legal counsel, does not believe that the ultimate resolution of these matters will have a material affect on the financial position or results of operations of the City. Management also believes that adequate reserves exist-in the internal service funds to cover outstanding lawsuits.On January 1, 2003, the City became a Participating Transmission Owner with the California Independent System Operator (ISO), entitling the City to receive compensation for use of its transmission facilities committed to the ISO's operational control. The compensation is based upon the City's Transmission Revenue Requirement (TRR) as approved by the Federal Energy Regulatory Commission (FERC). The California Investor Owned Utilities (IOU's), the California Department of Water Resources (CDWR), and the CPUC, among others, objected to various aspects of the City's TRR at the FERC. The City and the objecting parties submitted a settlement agreement for filing. The settlement agreement disposes of all City TRR issues except for CDWR's and CPUC's contention that the City is not entitled to its TRR for the majority of the transmission facilities committed to the ISO's control. After numerous FERC hearings, briefings, and decisions on this TRR issue, FERC issued a final order in favor of the City in late 2006.CDWR appealed this order to the U.S. Court of Appeals for the D.C. Circuit, but CDWR subsequently withdrew this petition, and the court issued an order dismissing the case on July 9, 2007. As a result of the dismissal, approximately
$49 million collected from the ISO through June 30, 2007 but previously held in reserves, has now been released to the Electric Utility's unrestricted operating cash reserve account, and is available for current operations or other strategic purposes upon approval of the Public Utilities Board and the City Council.(A) Plan Description.
The City of Riverside contributes to the California Public Employees Retirement System (CaIPERS), an agent multiple employer public employee defined benefit pension plan. CalPERS provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries.
CalPERS acts as a common investment and administrative agent for participating public entities within the State of California.
Benefit provisions and all other requirements are established by state statute and City ordinance.
Copies of CalPERS annual financial report may be obtained from their executive office: 400 P Street, Sacramento, CA 95814.(B) Funding Policy. Participants are required to contribute 8% (9% for safety employees) of their annual covered salary. The City makes the contributions required of City employees on their behalf and for their account. The City is required to contribute at an actuarially determined rate; the fiscal year 2006-2007 rate was 13.181% for non-safety employees, and 19.015% for safety-employees, of annual covered payroll. The contribution requirements of plan members and the City are established and may be amended by CalPERS.(C) Annual Pension Cost. For 2007, the City's annual pension cost of$35,053 for CalPERS was equal to its annual required contribution of$34,226 plus the effect of amortization of the net pension asset of $826. The required contribution was determined as part of the June 30, 2004 actuarial valuation using the entry age normal actuarial cost method. The actuarial assumptions included (a) 7.75% investment rate of return (net of administrative expenses), (b) projected salary increases of 3.25% per year compounded annually, attributable to inflation, and (c) 3.0% expected long term inflation.
The actuarial value of CalPERS assets was determined using techniques that smooth the affects of short-term volatility in the market value of investments over a four-year period (smoothed market value). CalPERS unfunded actuarial accrued liability is being amortized as a level percentage of projected payroll on a closed basis over 20 years.Three-year trend information for CalPERS: Fiscal Year June 30 2005 2006 2007 Annual Pension Cost (APC)$28,948 30,684 35,053 Percentage of APC Contributed 305%100%100%Net Pension Obligation (Asset)($147,842)
($147,546)
($147,521) 55 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
A total of $147,521 of net pension assets are included as a deferred charge in the Government-wide Statement of Net Assets. The deferred charge relating to the net pension assets will be amortized over 19 years in accordance with the method used by CalPERS for calculating actuarial gains and losses.Schedule of funding for CaIPERS: Southern California Public Power Authority The Electric Utility is a member of the Southern California Public Power Authority (SCPPA), a joint powers agency. SCPPA provides for the financing and construction of electric generating and transmission projects for participation by some or all of its members. To the extent the Electric Utility participates in projects developed by SCPPA, the Electric Utility is obligated for its proportionate share of the project cost. The projects and the Electric Utility's proportionate share of SCPPA's obligations are as follows: Entry Age Normal Actuarial Accrued Liability (AAL)Unfunded/(Overfunded)
Actuarial Accrued Liability (UAAL)Actuarial Valuation Plan Date Actuarial Value of Assets Funded Ratio Annual Covered Payroll UAAL as a % of Covered Payroll Proiect Palo Verde Nuclear Generating Station Southern Transmission System Hoover Dam Uprating Mead -Phoenix Transmission Mead -Adelanto Transmission Terms of Take or Pay Commitments Percent Share 5.40%10.20%31.91%4.00%13.50%Entitlement 11.7MW 195.0MW 30.0MW 12.0MW 118.0MW Misc. 6/30/03 568,712 511,281 Safety 6/30/03 413,125 329,673 Misc. 6/30/04 611,841 537,352 Safety 6/30/04 454,795 440,172 Misc. 6/30/05 655,642 634,694 Safety 6/30/05 486,880 468,652 57,431 89.9 75,838 75.7 83,452 79.8-, 44,611 187.1 74,489 87.8 77,960 95.5 14,623 96.8 48,635 30.1 As part of the take or pay commitments with IPA and SCPPA, the Electric Utility has agreed to pay its share of current and long-term obligations.
30,948 96.8 84,290 24.9 Payment for these obligations will be made from operating revenues received 18,228 96.3 50,368 36.2 during the year that payment is due. A long-term obligation has not been recorded on the accompanying financial statements for these commitments.
Interest rates on the outstanding debt associated with the take or pay obligations range from 3.0% to 6.125%. The following schedule details the amount of principal and interest, which is due and payable by the Electric Utility for each project in the fiscal year indicated.
- 15. Commitments and Contingencies A. Long-Term Electric Utility Commitments Intermountain Power Aaencv The City's Electric Utility has entered into a Power Purchases Contract with the Intermountain Power Agency (IPA) for delivery of electric power. The City's share of IPA power is equal to 7.6%, or approximately 137.1 megawatts, of the generation output of IPA's 1,800 megawatt coal-fueled generating station, located in Central Utah. The contract expires in 2027 and the debt fully matures in 2024.The contract constitutes an obligation of the Electric Utility to make payments solely from operating revenues and requires payment of certain minimum charges, which are based on debt service requirements.
Such payments are considered a cost of production and are quantified below.Fiscal Year 2008 2009 2010 2011 2012 Thereafter Total IPA Inter-mountain Power Project$ 20,886 21,852 22,626 26,440 24,061 210,212$a26.7zl SCPPA Palo Verde Nuclear Generating Proiect$ 849 846 709 706 704 3,481$7295 Trans-mission System Prooect$ 7,041 6,923 6,677 6,711 6,775 91,126$1252.53 Hoover Dam UoratinoQ$ 704 704 703 702 701 4,167$7-681 Mead-Phoenix Trans-mission$ 260 259 259 289 287 2 295$3,649 Mead-Adelanto Trans-mission$2,819 2,814 2,818 2,814 2,797.253133 Total$ 32,559 33,398 33,792 37,662 35,325 336,14$509150 56 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30. 2007 (amounts exoressed in thousands)
Take-or-pay commitments expire upon final maturity of outstanding bonds for each project. Final fiscal year maturities are as follows: Proiect Intermountain Power Project Palo Verde Nuclear Generating System Southern Transmission System Hoover Dam Uprating Mead-Phoenix Transmission Mead-Adelanto Transmission Final Maturity Date 2024 2017 2023 2017 2020 2020 In addition to debt service, Riverside's entitlement requires the payment for fuel costs, operating and maintenance, administrative and general and other miscellaneous costs associated with the generation and transmission facilities discussed above. These costs do not have a similar structured payment schedule as debt service and vary each year. The costs incurred for 2006 and 2007 fiscal years are as follows: Fiscal Year 2006 2007 IPA 24,121 24,227 Pv 2,122 2,122 STS 1,845 1,948 MAP 220 249 MPP 43 49 Hoover 96 96 Total 28,447 28,691 The agreement with Deseret is for five megawatts of capacity and associated energy from January 1, 1992, through December 31, 1994, then increasing to 52 megawatts of capacity and associated energy through December 31, 2009. A notice of termination of the power purchase agreement was provided to Deseret effective March 31, 1998, resulting in litigation that was settled on July 31, 1999. Under the terms of the settlement agreement, the notice of termination was rescinded and the power purchase agreement was amended to reflect substantial price reductions after fiscal year 2002 through the term of the agreement in 2009. In exchange, the Electric Utility paid Deseret $25 million from reserves, which is reflected on the Statement of Net Assets as unamortized purchase power. On July 1, 2002, the Electric Utility began to amortize the related price reductions, and will continue to amortize the remaining balance over the term of the agreement using the straight-line method. As of June 30, 2007, unamortized purchased power was $8,352 and the Electric Utility had recorded amortization of $3,341.There are two separate agreements with CDWR. The two agreements, CDWR III and IV are for the purchase of 23 and 30 megawatts of capacity and associated energy from May through October. CDWR III and CDWR IV are for a period of 15 years beginning June 1, 1996, subject to termination.
In early 2005, CDWR and the City disagreed upon whether the Power Sale Agreements III and IV were still in effect as of December 31, 2004. While CDWR believed the agreements were terminated, the City contended that CDWR did not provide proper notification under the terms of the power sale agreements.
During May and June, CDWR continued to provide power under the original terms of the contracts, pending staff's resolution of the dispute. On September 13, 2005, in order to maintain the City's long-term relationship with CDWR and to avoid costly litigation, City Council approved the contract amendments, effectively terminating the contract in 2007 and reducing the final two years of the contracts to a period of May through.September.
An agreement with Bonneville Power Administration (BPA) is for a purchase of firm capacity and associated energy of 23 megawatts in the summer and 16 megawatts in the winter for a period of twenty years ending February 1, 2011. A second agreement with BPA was executed in 1996 and is for the purchase of firm capacity (50 megawatts during the summer months and 13 megawatts during the winter months) and associated energy beginning April 30, 1996 for twenty years. Effective May 1, 1998, these summer and winter capacity amounts increased to 60 and 15 magawatts, respectively, for the remainder of the second agreement.
B. Other Commitments Power Purchase Agreements:
The City has executed five firm power purchase agreements for non-renewable power. The agreements are with Deseret Generation and Transmission Cooperative (Deseret) of Murray, Utah; CDWR; and Bonneville Power Administration (BPA). The minimum, annual obligations under each of these contracts are shown in the table below.Minimum Obligations 2006-2007 Supplier Deseret CDWR III CDWR IV BPA Capacity$3,463 446 581 861 Ener$8$1,824$1.824 Total$5,287 446 581 861 57 CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands)
On July 8, 2003, and June 6, 2003, the City Council and Public Utilities Board, respectively, adopted the Renewable Portfolio Standard to increase procurement of renewable resources to reach a target of 20 percent of the Utility's energy from renewable sources by 2015. The contracts in the following table were executed as part of compliance with this standard.
The Electric Utility has agreements with Bonneville Power Administration for the purchase of energy credits that add to the total renewable portfolio.
In the current year, renewable resources provided approximately 13 percent of the retail energy requirements, approximately 11 percent of the total power supply./Long-term renewable power purchase agreements:
Supplier Milliken Genco Mid Valley Genco Riverside County (Badlands Landfill)Wintec Salton Sea Total TLpe Landfill Gas Landfill Gas Landfill Gas Wind Geothermal Maximum Contract 2.3MW 2.3MW 1.2MW 1.3MW 20.0MW 27.1MW Contract Expiration 12/31/2007 12/31/2007 12/31/2008 4/30/2018 5/31/2013 Estimated Annual Cost for 2008$416 475 256 176 9,645 As of June 30, 2007, the Water Utility had major construction commitments of approximately
$19,276 with respect to unfinished capital projects.
Of these commitments, $10,106 is expected to be funded by bonds, $8,099 by other sources and $1,071 funded by rates.C. Jointly Governed Organizations On November 1, 1980, the City of Riverside joined with the cities of Los Angeles, Anaheim, Vernon, Azusa, Banning, Colton, Burbank, Glendale, Pasadena, and Imperial Irrigation District to create the Southern California Public Power Authority (SCPPA) by a Joint Powers Agreement under the laws of the State of California.
As of July 2001, the cities of Cerritos and San Marcos were admitted as members of SCPPA. In August 2003, the Authority rescinded the membership of the City of San Marcos, as the City no longer met the criteria for membership.
The primary purpose of the Authority is to plan, finance, develop, acquire, construct, operate and maintain projects for the generation and transmission of electric energy for sale to its participants.
The Authority is governed by a Board of Directors, which consists of one representative for each of the members. During the 2007 fiscal year, the Electric Utility paid approximately
$16,854 to SCPPA under various take-or-pay contracts, which are described in greater detail in Note 14A. These payments are reflected as a component of purchased power in the financial statements.
On July 1, 1990, the City of Riverside joined with the cities of Azusa, Banning and Colton to create the Power Agency of California (Agency) by a Joint Powers Agreement under the laws of the State of California.
The City of Anaheim joined the Agency on July, 1 1996. The primary purpose of the Agency is to take advantage of economies of scale resulting from the five cities acting in concert. The Agency has the ability to plan, finance, develop, acquire, construct, operate and maintain projects for the generation and transmission of electric energy for sale to its participants.
The Agency is governed by a Board of Directors (the Board), which consists of one representative for each of the members. The term of the Joint Powers Agreement is fifty years. On April 5, 2001 the Board placed the Agency in an inactive status, effective June 30, 2001. It can only be reactivated with authorization from the Agency Board.D. Jointly-Owned Utility Project Pursuant to the Settlement Agreement with Southern California Edison (SCE) dated August 4, 1972, the City was granted the right to acquire a 58 Under the terms of the renewable power purchase agreements, Riverside's financial obligation is only for actual energy delivered.
On August 23, 2005, the City Council approved an amendment to the Power Sales Agreement between Salton Sea and the City. The agreement increases the amount of renewable energy available to the City from the current 20 MW to 46 MW effective June 1, 2009 through May 31, 2020, at the same price under the current contract until 2013, with escalation thereafter based on an inflationary type index. Similar to other renewable power purchase agreements, the City is only obligated for purchases of energy delivered to the City.Construction Commitments:
As of June 30, 2007, the Electric Utility had major construction commitments of approximately
$15,508 with respect to unfinished capital projects.
Of these commitments, $11,264 is expected to be funded by bonds, $1,274 funded by rates and $2,970 by others.
CITY OF RIVERSIDE NOTES TO BASIC FINANCIAL STATEMENTS For the year ended June 30, 2007 (amounts expressed in thousands) 1.79% ownership interest in San Onofre Nuclear Generating Station (SONGS) Units 2 and 3. Pursuant to the Settlement Agreement, SCE agreed to provide the necessary transmission service to deliver the output of SONGS to Riverside.
SCE and the City entered into the SONGS Participation Agreement which sets forth the terms and conditions under which the City, through the Electric Utility, participates in the ownership and output of SONGS. Other participants in this project include SCE, 75.05 percent; San Diego Gas and Electric Company, 20.00 percent; and the City of Anaheim, 3.16 percent. Maintenance and operation of SONGS remains the responsibility of SCE, as operating agent for the City.SCE, as operating agent, has declared an "operating impairment" due to deterioration of the steam generators
("SGs"), which would likely result in permanent shutdown of the plant in the 2009-2010 timeframe.
The estimated cost to replace the SGs is $680 million, of which approximately
$12.2 million would represent the City's share. The replacement is expected to enable plant operations through at least 2022, and perhaps beyond if Nuclear Regulatory Commission approval is obtained.
Although the City Council has approved participation in the replacement of the SGs, the City of Anaheim has opted not to participate.
As a result, upon replacement of the SGs, Riverside and San Diego Gas and Electric Company will retain their respective 1.79 and 75.05 percent shares and SCE will assume Anaheim's interest-resulting in a 78.21 percent interest in both units 1 and 2 at SONGS.The original operating license for SONGS units 2 and 3 was set to expire in 2013; however, this was subsequently extended due to a construction recapture provision, and now expires February 16, 2022 and November 15, 2022 for Units 2 and 3 respectively.
There are no separate financial statements for the jointly-owned utility plant since each participant's interest in the utility plant and operating expenses is included in their respective financial statements.
The Electric Utility's share of the capitalized construction cost and operating expenses is included in the financial statements.
As of June 30, 2007, Riverside's 1.79% share of the capitalized construction costs for SONGS totaled $138,575 with accumulated depreciation of $108,709.
The Electric Utility made provisions during fiscal.year 2006 for nuclear fuel burn of $911 and for future decommissioning cost of $1,581 (See Note 1). The Electric Utility's portion of current and long-term debt associated with SONGS is included in the accompanying financial statements.
As a participant in the SONGS, the Electric Utility could be subject to assessment of additional insurance premiums in the event of a nuclear incident at San Onofre or any other licensed reactor in the United States.16. Restatement of Net Assets/Fund Balance The City's Net Assets for Governmental Activities and Fund balance at June 30, 2007 have been restated to properly classify land which was purchased from the Water fund as land held for-resale rather than as a capital asset and to properly report the asset at their original acquisition cost.The restatements had the following effect on the Net Assets for Governmental Activities:
Beginning, as previously reported Land Purchase Beginning, as restated$729,113 (5,415)$723-698 The restatements had the following effect on Beginning Fund Balance: General Fund Beginning, as previously reported Land Purchase Beginning, as restated$128,897 2,593 1131-490 59
City of Riverside Combining Balance Sheet Nonmajor Governmental Funds June 30, 2007 (amounts expressed in thousands)
Special Revenues Assets Cash and investments Cash and investestments at fiscal agent Receivables (net of allowances for uncollectibles):
Interest Property taxes Accounts Intergovernmental Notes Prepaid items Advances to other funds Land & improvements held for resale Total assets Library$ 2,718 Gas Tax$ 9,238 Housing &Air Quality Community Improvements Development
$ 744 $ 85 7 Redevelopment Agency$ 14,011 8,447 Special Designation NPDES Storm Fund Drain Total$ $ $ 26,796 8,454 36 517 1 119 111 9 2 1,831 5,993 138 1 199 7,846 302 517 4 2,564 13,839 1 423 1----5,988 -5,988$ 3,273 $ 9,468 $ 753 $ 7,918 $ 36,630 $ $ 423 $ 58,465 Liabilities and fund balances Liabilities Accounts payable Accrued payroll Retainage payable Unearned revenue Deposits Due to other funds Advances from other funds Total liabilities Fund balances Reserved: Reserved for noncurrent loans receivable Reserved for encumbrances Reserved for fixed assets Reserved-for prepaid items Reserved for debt service Reserved for interfund receivable Reserved for library services Unreserved, designated for future operations Unreserved, undesignated Total fund balances Total liabilities and fund balances$ 37 9 281 2,492 2,819 100 I 353 454$ 3,273$ 437 $3,247 30 2$1,035 4 6,267$53 3,684 32 612 7,918 7,777 10 3,594 11,434$$ 3 $ 1,595-15 3,247 14,325-10 420 4,014-3,104 423 26,310 2,066 30 1,026 70 143 5,988 70 3,365 5,988 1 595 3,718 96 5,784 721$ 9,468 $ 753 (1,026)$ 7,918 7,119 11,876 25,196$ 36,630 7,714 15,017 S- 32,155$ $ 423 $ 58,465 continued 61 City of Riverside Combining Balance Sheet Nonmajor Governmental Funds June 30, 2007 (amounts expressed in thousands)
Debt Service Riverside Municipal Improvements Debt Service Corporation
$ 50 $ 118-14,026 Capital Projects Permanent Fund Library Special$ 1,315 Assets Cash and investments Cash and investments at fiscal agent Receivables(net of allowances for uncollectibles):
Interest Property taxes Accounts Intergovernmental Notes Prepaid items Advances to other funds Land & improvements held for resale Total assets Liabilities and fund balances Liabilities:
Accounts payable Accrued payroll Retainage payable Unearned revenue Deposits Due to other funds Advances from other funds Total liabilities Fund balances (deficits):
Reserved Reserved for noncurrent loans receivable Reserved for encumbrances Reserved for fixed assets -Reserved for prepaid items Reserved for debt service Reserved for interfund receivable Reserved for library services Unreserved, designated for future operations Unreserved, undesignated Total fund balances Total liabilities and fund balances Total$ 168 14,026 Special Capital Improvement
$ 23,944 7,794 Storm Drain Transportation Total$ 5,335 $ $ 29,279--7,794 2 294 28 62-356 1,162 1,134$ 1,315$ 51 $ 14,145$ 14,196 $ 32,060 $ 5,397 $ 1,134 $ 38,591$$-$$463 1,443 16$ 1 9 25$ 35$106 984 499 $1,452 147 984 3,082 -Total Nonmajor Governmental Funds$ 57,558 30,274 660 517 4 3,726 13,839 1 5,988$ 112,567$ 2,094 15 4,699 14,472 10 4,998 3,104 29,392 70 6,623 5,988 1 14,196 1,028 1,315 25,512 28,442 83,175$ 112,567--1.922 1,125 -3,159 1,028 93 6 3,258 51 51$ 51 14,145 14,145$ 14,145 14,196 14,196$ 14,196 14,108 11,843 30,138$ 32,060 3,690.1,579 5,362$ 5,397 3 9$ 1,134 1,028 --1,315 17,798 -13,425 -35,509 -1,315$ 38,591 $ 1,315 62 City of Riverside Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Special Revenue Library Gas Tax Revenues Taxes Intergovernmental Charges for services Fines and forfeitures Special assessments Rental and investment income Miscellaneous Total revenues Expenditures Current: General government Culture and recreation Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures Other financing sources (uses)Transfers in Transfers out Sales of capital assets Total other financing sources (uses)Net Change in fund balances Fund balances -beginning Fund balances -ending 5,969 256 11 219 89 73 6,617$6,969 Air Quality Improvement 347 33 380 Housing and Community Development
$-$ 9,961 $6,086 199$Redevelopment Special NPDES Storm Agency Designation Drain 537 7,506 1,642 9,546 11,188 (3,682)56 979 7,121 898 6,265 7,163 (42)--423 805 -448 -11,413 423 9,208 9,208 (2,591)254 1,349 254 126 1,427 2,776 8,637-228 195 423 Total 15,930 13,857 11 219 423 1,520 1,500 33,460 4,371 9,208 17,433 31,012 2,448 2,562 (4,506)526 (1,418)1,030 31,125 32,155 continued 2,320 42 200 (3,249)(1,257)522 2,842 251203$ 454 (3,682)9,466$ 5,784 126 595 721 42$4 (3,045) (1,257)5,592 -(1,257)19,604 1,257$ 25,196 $ -$63 City of Riverside Combining Statement of Revenues, Expenditures, and Changes in Fund Balances NonmajorGovernmental Funds For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Debt Service Riverside Municipal Debt Improvements Service Corporation Capital Projects Permanent Fund Total Debt Service Special Capital Improvement Revenues Taxes Licenses and permits Intergovernmental Charges for services Fines and forfeitures Special assessments Rental and investment income Miscellaneous Total revenues Expenditures Current: General government Culture and recreation Capital outlay Debt service: Principal Interest Bond issuance costs Total expenditures Excess (deficiency) of revenues over (under) expenditures Other financing sources (uses)Transfers in Transfers out Proceeds from issuance of bonds Premiums on bonds issued Sales of capital assets Total other financing sources (uses)Net Change in fund balances Fund balances -beginning Fund balances -ending$$4,415 Strom Drain$748 262 140 1,150 Transportation Projects 132 132 3 3 1,091 1,091 1,094 1,094 Total Nonmajor Total Capital Library Governmental Projects Special Funds$5,163 132 2,236 348 7,879$53 248 301 1,974 208 6,597 238 238 225 19,185 10 633 235 187 20,005 151 660 660 1,688 1,688 1,746 1,746 4,332 4,332 3 (3,241) -(3,238)(28) (28)16,644 16,644 32 32 16,648 16,648 3 13,407 13,410 48 738 786$ -51 $ 14,145 $ 14,196$ 15,930 5,163 13,989 11 219 423 4,903 2,096 42,734 4,844 9,359 37,438 660 1,688 1,746 55,735 (13,001)2,562 (4,612)16,644 32 616 15,242 2,241 80,934$ 83,175 19,410 643 187 20,240 151 (12,813) -507 -(55) -(12,361) 150 (78)(78)90 90 12 --12 (12,801) -507 -(55) -(12,349)42,939 4,855 64 47,858$ 30,138 $ 5,362 $ 9 $ 35,509 150 1,165$ 1,315 64 City of Riverside Schedule of Revenues, Expenditures and Changes In Fund Balances -Budget and Actual Nonmajor Governmental Funds For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Special Revenue Library Gas Tax Air Quality Improvement Revenues Taxes Intergovernmental Charges for services Fines and forfeitures Rental and investment income Miscellaneous Final Budget$ 6,224 298 14 190 13 122* Variance to Final Actual Budget$ 5,969 256 11 219 89 73$ (255)(42)(3)29 76 (49)Final Budget$7,350 60 Variance to Final Final Actual Budget Budget$$$$6,969 517 Variance to Final Actual Budget (381)477 340.347 33 7 33 Total revenues 6,861 6,617 (244)Expenditures Current General government Culture and recreation Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures 12,435 12,435 (5,574)1,572 1,572 203$ (3,799)9,208 9,208 (2,591)2,320 522 2,842 203$ 454 3,227 3,227 2,983 748 522 1,270$ 4,253 7,410 7,506 96 1,435 1,642 (207)15,420 9,546 5,874 16,855 11,188 5,667 (9,445) (3,682) 5,763 340 380 40 485 281 766 (426)595$ 169 254 254 126 552 231 281 512 Other financing sources (uses)Transfers in Sales of capital assets Total other financing sources Fund balances (deficit), beginning Fund balances (deficit), ending 9,466$ 21 9,466$ 5,784$ 5,763 595$ 721$ 552 (continued) 65 City of Riverside Schedule of Revenues, Expenditures and Changes in Fund Balances -Budget and Actual Nonmajor Governmental Funds For the fiscal year ended June 30, 2007 (amounts expressed In thousands)
Special Revenue Housing & Community Development Variance Redevelopment Agency Variance Special Designation Revenues Taxes Intergovernmental Rental and investment income Miscellaneous Final Budget 16,676 1,040 to Final Final Actual Budget Budget to Final Final Actual Budget Budget Variance to Final Actual Budget$6,086 56 979 (10,590)56 (61)$ 5,915 250 53 10$ 9,961 199 805 448$ 4,046 $(51)752 50 438 --$(5o-(50)Total revenues 17,716 7,121 (10,595)6,228 11,413 5,185 50 Expenditures Current *General government Capital outlay Total exlpenditures Excess (deficiency) of revenues over (under) expenditures 919 16,555 17,474 242 898 6,265 7,163 (42)21 10,290 10,311 (284)1,416 14,684 16,100 (9,872)Other financing sources (uses)Transfers in Transfers out Sale of capital assets Total other financing sources (uses)Net change in fund balances Fund balances, beginning Fund balances (deficits), ending 1,349 1,427 2,776 8,637 200 (3,249)4 (3,045)5,592 67 13,257_13,324 -18,509 50 (6,456)4 (6,452)12,057 50 42 42 200--3,207 42 42 3,407 (1,257)(1,257)(1,257)(50)(50)(1,257)(1,257)(1,307)$ (1,307)(continued) 242 (242)(6,465)-19,604 19,604 -1,257 1,257$ 242 $ (242) $ 13,139 $ 25,196 $ 12,057 $ 1,307 $ -66 City of Riverside Schedule of Revenues, Expenditures and Changes In Fund Balances -Budget and Actual Nonmajor Governmental Funds For the fiscal year ended June 30, 2007 (amounts expressed In thousands)
Special Revenue Capital Projects NPDES Storm Drainr Capital Outlay Special Capital Improvements Final Budget Variance to Final Final Actual Budget Budget Variance to Final Actual Budget Revenues Licenses and permits Intergovemmenlal Special assessments Rental and investment income Miscellaneous Total revenues$S S 423 (142)565 73,204 350 1,000 1,50i 76,055$21,434 1,784 3,112 417 26,747 565 423 (142)Expenditures Current General government Culture and recreation Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures 328 267 595 (30)228 195 423 100 72 172 30 53,708 728 109,811 163,519 (87,464)50,668 51,396 (24,649)$(51,770)1,434 2,112 (1,084)(49,308)52,980 59,143 112,123 62,815 28 122,276 186 288 122,778 185,593 8,500 39,014 47,514 (47,117)225 19,185 8.275 19,829 Final Budget$210 187 397 Variance to Final Actual Budget$ 4,415 $ 4,415 (210)1,974 1,974 208 21 6,597 6,200 19,410 28,104 (12,813) 34,304 Other financing sources (uses)Transfers in Transfers out Issuance of bonds Premiums on bonds issued Sales of capital assets Total other financing sources Net change in fund balances Fund balances, beginning Fund balances (deficits), ending 28 122,276 186 288 S- 122,778 30 (87,464) 98,129 (78)(78)(47,195)(78)(30)90 12 (12,801)90 90 34,394$ 34,394 (continued)
--37,071 37,071 -42,939 42,939$ (30) $ $ 30 $ (50,393) $ 135,200 $ 185,593 $ (4,256) $ 30,138 67 City of Riverside Schedule of Revenues, Expenditures and Changes In Fund Balances -Budget and Actual Nonmajor Governmental Funds For the fiscal year ended June 30, 2007 (amounts expressed In thousands)
Capital Projects Storm Drain Redevelopment Agency...... 1-1.-..-., Revenues Licenses and permits Intergovemmental Charges for services Rental and investment income Miscellaneous Total revenues Expenditures Current General government Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures Other financing sources (uses)Transfers in Transfers out Issuance of bonds Premiums on bonds issued Sale of capital assets Total other financing sources (uses)Net change in fund balances Fund balances, beginning Fund balances, ending Final Budget$200 30 230 4,195 4,195 (3,965)(3,965)4,855$ g890 Actual$ 748 262 140 1,150 10 633 643 507 507 4,855$ 5,362 Variance to Final Budget$ 748 (200)232 140 920 (10)3,562 3,552 4,472 4,472$ 4,472 Final Budget$452 452 438 438 14 14 64$ .78 Variance to Final Actual Budget$ -$132 132 187 187 (55)(55)64$ 9 (320)(320)251 251 (69)(69)$ (69)Final Budget$2,687 1,215 152 4,054 7,219 207,401 214,620 (210,566)45,782 45,782 (164,784)42,424$ (122,360)Actual$242 3,925 74 4,241 6,764 28,964 35,728 (31,487)45,782 (819)154,880 2,213 (760)201,296 169,809 42,424$ 212,233 Variance to Final Budget$(2,445)2,710 (78)187 455 178,437 178,892 179,079 (819)154,880 2,213 (760)155,514 334,593$ 334,593 68 City of Riverside Combining Statement of Net Assets Nonmajor Enterprise Funds June 30, 2007 (amounts expressed in thousands)
Assets Current assets: Cash and investments Receivables (net of allowance for uncollectibles)
Interest Utility billed Utility unbilled Accounts Intergovernmental Nuclear materials inventory Inventory Prepaid items Due from other funds Advances to other funds Restricted assets: Cash and cash equivalents Total Current assets Non-current assets: Deferred charges Capital assets: Land Buildings Accumulated depreciation-buildings Improvements other than buildings Accumulated depreciation-improvements other than buildings Machinery and equipment Accumulated depreciation-machinery and equipment Construction in progress Total non-current assets: Airpori Refuse Transportation Public Parking Total$$ 2,309 $1,143 $ 5,847 $71 548 644 239 4o 9,299 111 548 644 395 4,583 155 4,449 I 134 4,604 3,236 7,047 1,277 5,888 3,236 18,816 254 5,941 665 186 7,046 7,061 2,114 (867)6,853 (3,003)258 (122)10,613 23,161 27,765 22 (7)10,771 1,746 (6,402) (1,356)251 10,561 1,070 17,608 2,347-3,713 19,914 (2,150)325 (325)819 (468)22,014 27,902 10,774 22,050 (3,024)7,178 (3,328)13,594 (8,348)10,864 56,806 75,622 continued Total assets 69 City of Riverside Combining Statement of Net Assets Nonmajor Enterprise Funds June 30, 2007 (amounts expressed in thousands)
Liabilities Current liabilities:
Accounts payable Accrued payroll Unearned revenue Deposits Due to other funds Capital leases-current Landfill capping-current Total Current liabilities Airport 509 58 97 Refuse Transportation Public Parking Total 573 768 14 151 1,105 1 45 1,097 1,022 1,202 1 2,898 17 2,898 17 Non-current liabilities:
Capital leases Advances from other funds Landfill capping Total non-current liabilities Total liabilities 3,580 166 349 515 4,095 14,695 8,975 23,670 300 1,641 1,270 Net Assets Invested in capital assets, net of related debt Restricted for other purposes Unrestricted Total net assets 1,376 662 2,821 4,197 662 5,838 1,932 2,140 791 3,217, 6,413 (376)$ 11,770 $ 415-300 46 6,537-166 7,282 9,669-2,821 7,282 12,656 7,328 19,193 4,435 22,061-3,217 16,039 31,151$ 20,574 $ 56,429 70 City of Riverside Combining Statement of Revenues, Expenses, and Changes in Fund Net Assets Nonmajor Enterprise Funds For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Operating revenues: Charges for services Operating expenses: Personal services Contractual services Maintenance and operation General Materials and supplies Insurance Depreciation and amortization Total operating expenses -Operating Income (loss)Nonoperating revenues (expenses):
Operating grants Interest income Other Loss on retirement of capital assets Interest expense and fiscal charges Total non-operating revenues Income before capital contributions and transfers Capital contributions Transfers in Change in net assets Total net assets -beginning Total net assets -ending Airport Refuse Transportation Public Parking Totals$ 1,263 $ 15,833 $ 302 $ 3,431 $ 20,829 460 3,697 1,450 448 6,055 42 3,534 32 836 4,444 154 5,250 457 278 6,139 220 2,146 253 1,545 4,164 13 619 204 6 842 27 86 15 65 193 221 1,091 386 439 2,137 1,137 16,423 2,797 3,617 23,974 126 (590) (2,495) (186) (3,145)1,939 350 183 150 517 1,939 500 738 38-(42) (42)(64) (67) (34) (145) (310)(26) 424 1,905 -522 -2,825 100 (166) (590) 336 (320)4,959 7 209 5,175-150 150 5,059 (9) (381) 336 5,005 18,611 11,779 796 20,238 51,424$ 23,670 $ 11,770 $ 415 $ 20,574 $ 56,429 71 City of Riverside Combining Statement of Cash Flows Nonmajor Enterprise Funds For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Cash flows from operating activities:
Cash received from customers and users Cash paid to employees for services Cash paid to other suppliers of goods or services Other receipts Net cash provided (used) by operating activities Cash flows from noncapital financing activities:
Transfers in Operating grants Advances from interfund receivables Payments on interfund receivables Advances to other funds Net cash provided (used) by noncapital financing activities Cash flows from capital and related financing activities:
Purchase of capital assets Proceeds from the sale of capital assets Principal paid on long-term obligations Interest paid on long-term obligations Capital contributions Net cash provided (used) for capital and related financing activities Cash flows from investing activities:
Income from investments Net cash provided by investing activities Net change in cash and cash equivalents Airport 1,209 (451)51 38 847 2,898 (51)2,817 (5,132)(20)(64)603 (4,613)3 3 (946)946 Trans- Public Refuse portation Parking$ 15,576 $ 308 $ 3,466 (3,678) (1,437) (438)(11,922) (950) (2,799)183 -517 159 (2,079) 746 150 2,765 3,014 (754) (7) (387)(604) 2,758 2,627 Totals$ 20,559 (6,004)(15,620)738 (327)150 2,765 5,912 (1,229)7,598 (8,220)(20)(310)819 (7,731)544 544 84 12,451$ 12,535 continued (2,677)(411)(67) (34) (145)7 209 _(2,737) 175 (556)398 -143 398 -143 (2,784) 854 2,960 8,329 289 2,887 5,545 $ 1,143 $ 5,847 Cash and cash equivalents, beginning Cash and cash equivalents, ending 72 City of Riverside Combining Statement of Cash Flows Nonmajor Enterprise Funds For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Trans- Public Airport Refuse portation Parking Totals Reconciliation of operating income (loss) to net cash provided (used) by operating activities:
Operating Income (loss)Other receipts Adjustments to reconcile operating income (loss) to net cash provided (used) by operating activities:
Depreciation and amortization Amortization of pension costs (Increase) in utility billed receivable (Increase) in utility unbilled receivable (Increase) decrease in accounts receivable Decrease in intergovernmental receivable Increase (decrease)in accounts payable Increase in accrued payroll Increase in deferred revenue (Decrease) in landfill capping Net cash provided (used) by operating activities Schedule of noncash financing and investing activities:
Contribution in aid$126 $38 221 1 (53)501 8 (590)183 1,091 9 (96)(12)(149)(2,495) $ (186)517 (3,145)738 386 4 6 439 7 29 (69)8 1 2,137 14 (96)(12)(189)29 479 35 6 36 10 11 9-(323) -(323)$ 847 $ 159 $ (2,079) $ 746 $ (327)$ 0 $ 7 $ 42 $ 0 $ 49 73
-Y I--*
City of Riverside Combining Statement of Net Assets Internal Service Funds June 30, 2007 (amounts expressed in thousands)
Assets Current assets: Cash and investments Receivables (net of allowances for uncollectibles):
Interest Accounts Intergovernmental Inventory Prepaid items Total current assets Deferred charges Advances to other funds Capital Assets: Buildings Accumulated depreciation-buildings Machinery and equipment Accumulated depreciation-machinery and equipment Capital assets (net of accumulated depreciation)
Total assets Liabilities Current liabilities:
Accounts payable Accrued payroll Claims and judgements Deposits Due to other funds Advances from other funds Total current liabilities Total liabilities Net Assets Invested in capital assets, net of related debt Unrestricted Total net assets* Workers'Compensation Self-Insurance Unemployment Compensation Public Liability Central Stores Central Garage Totals$2,662 $348 $821 $-$447 $4,278 150 4 18 1 2,831 243 10,367 7 (7)13,441 5,307 7 352 911 5,314 S- 255 6,712 148 S- (126)S- 22 352 7,623 5,591 2 246 32 32 3 21 609 5,916 8 1,093 10,501 1,145 1,643-17,079 1,488 (92)1,488 (92)9,967 10,122 (7,195) (7,328)4,168 4,190 6,406 33,413 2 3 19,687 203 8,226 167 111 437 478 809 592 27,989 76 242 19,934 19,934 3,132 903 76 8,429 4,313 76 8,429 4,313 S- 22 276 (806) 1,256$ 276 $ (806) $ 1,278 75-3,132 1,140 2,285 2,055 34,807 2,055 34,807 4,168 4,190 183 (5,584)$ 4,351 $ (1,394)(6,493)$ (6,493)
City of Riverside Combining Statement of Revenues, Expenses, and Changes in Fund Net Assets Internal Service Funds For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Self-Insured Operating revenues: Charges for services Operating expenses: Personal services Contractual services Maintenance and operation General Materials and supplies Insurance Depreciation and amortization Total operating expenses Operating Income (loss)Nonoperating revenues (expenses):
Interest Income Other Gain on retirement of capital assets Interest expense and fiscal charges Total non-operating revenue (expenses)
Workers'Compensation
$ 3,895 313 17 58 417 i 8,573 9,379 (5,484)777 19 (12)784 (4,700)(1,793)$ (6,493)Unemployment Compensation Public Liability Central Stores Central Garage Totals$ 75 $ 3,454 $ 1,463 $ 5,261 $ 14,148--525 2,284 3,122 11 -102 130--22 1,365 1,445 11 379 395 828 2,030--294 85 380 202 6,062 6 16 14,859--10 809 819 213 6,452 1,252 5,489 22,785 (138) (2,998) 211 (228) (8,637)22 448 -36 1,283-(3) 32 48-(10) (10)-(12) (55) (79)22 448 (15) 3 1,242 (116) (2,550) 196 (225) (7,395)392 1,744 1,082 4,576 6,00i$ 276 $ (806) $ 1,278 $ 4,351 $ (1,394)Change in net assets Total net assets -beginning Total net assets -ending 76 City of Riverside Combining Statement of Cash Flows Internal Service Funds For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Self Insured Cash flows from operating activities:
Cash received from customers and users Cash paid to employees for services Cash paid to other suppliers of goods or services Other Net cash provided (used) by operating activities Cash flows from noncapital financing activities:
Advances to other funds Net cash provided by noncapital financing activities Cash flows from capital and related financing activities:
Interest paid on long-term obligation Purchase of capital assets Net cash (used) for capital and related financing activities Workers'Compensation
$ 3,899 (399)(3,112)19 407 (10,043)(10,043)Unemployment Public Compensation Liability Central Stores$75 $ 3,454 $ 1,465--(529)(213) (4,687) (921)(138) (1,233)-(6,712)(6,712)15 (3)(3)Central Garage$ 5,626 (2,247)(2,575)32 836 (13)(13)(55)(1,457)(1,512)46 46 Total$ 14,519 (3,175)(11,508)51 (113)(16,771)(16,771)(79)(1,457)(1,536)1,310 1,310 (12)(12)(12)(12)Cash flows from investing activities:
Income from investments 771 771 24 469 24 469 Net increase (decrease) in cash and cash equivalents (8,877)(114)(7,476)(643)(17,110)Cash and cash equivalents, beginning Cash and cash equivalents, ending 11,539$ 2,662 462 8,297$ 348 $ 821 1,090$ 447 21,388$ 4,278 continued$77 City of Riverside Combining Statement of Cash Flows Internal Service Funds For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Self Insured Workers' Unemployment Public Central Compensation Compensation Liability Stores Central Garage Total Reconciliation of operating income to net cash provided (used) by operating activities:
Operating income (loss)Other Adjustments to reconcile operating income (loss) to net cash provided (used) by operating activities:
Depreciation and amortization Amortization of pension costs (Increase) in account receivable (Increase) in intergovernmental receivable (Increase) in prepaid items (Increase) in inventory Increase (decrease) in accounts payable Increase (decrease) in accrued payroll Increase in due to other funds Increase (decrease) in claims and judgments Net cash provided (used) by operating activities (5,484) $(138) $(2,998) $211 $ (228) $-32 1 10 1 24 (1)809 7 (21)386 (126)(53)30 (8,637)32 819 9 (21)412 (1)1,227 (595)(62)(1,301)(287)1 (87)1,353 (256)(5)(1,301)5,953 2,052 _407 $ (138) $ (1,233) $ 15-8,005$ 836 $ (113)78 City of Riverside Fiduciary Fund -Agency Fund Combining Statement of Changes in Assets ahd Liabilities For the fiscal year ended June 30, 2007 (amounts expressed in thousands)
Balance Balance July 1, June 30, 2006 Additions Deductions 2007 Assets: Cash and investments Cash and investments at fiscal agent Interest receivable Property taxes receivable Total assets Liabilities:
Accounts payable Held for bond holders Total liabilities
$ 6,776 13,287 64 214$ 20,341$ 0 20,341$ 20,341$ 9,578 5,276 865 418$ 16,137$ 140 12,276$ 12,416$ 5,167 9,402 821 214$ 15,604$ 129 11,754$ 11,883$ 11,187 9,161 108 418$ 20,874$ 11 20,863$ 20,874 79
City of Riverside*
Capital Assets Used in the Operation of Governmental Funds Schedule By Source June 30, 2007 (amounts expressed in thousands)
Governmental funds capital assets: Land Buildings and improvements Improvements other than buildings Machinery and equipment Infrastructure Construction in progress Total governmental funds capital assets Investments in governmental funds capital assets by source: Certificates of participation Gifts Operating revenue General obligation bonds Revenue bonds County contracts and grants State grants Asset forfeiture
-state Asset forfeiture
-federal Housing and community development grants Other federal grants Community facilities bonds Assessment district bonds Capital leases RDA tax increment bonds Capital projects funds Total governmental funds capital assets*$ 191,694 102,042 60,662 67,622 587,856 64,987$ 1,074,863$ 50,941 136,346 189,456 4,483 21,104 218 32,597 121 1,744 17,025 22,410 1,026 397 13,038 2;278 581,679$ 1,074,863 81 City of Riverside Capital Assets Used in the Operation of Governmental Funds Schedule By Function and Activity June 30, 2007 (amount expressed in thousands)
Construction in Construction in Progress/
Progress/Buildings Improvements and Other than Machinery and Land Improvements Buildings Equipment Infrastructure Total General government Public safety Highways and streets Recreation and culture Community development Total governmental funds capital assets$ 8,372 $ 34,273 $12,743 42,405 16,816 $ 10,077 $0 34,266 0 $ 69,538 0 89,414 148,425 16,430 530 18,731 587,858 771,974 20,865 95,237 21,628 4,251 0 141,981 1,289 370 0 297 0 1,956$ 191,694 $ 188,715 $ 38,974 $ 67,622 $ 587,858 $ 1,074,863 82 City of Riverside Capital Assets Used in the Operation of Governmental Funds Schedule of Changes By Function and Activity For the fiscal year ended June 30, 2007 (amount expressed in thousands)
Governmental Funds Capital Assets Deductions and July 1, 2005 Additions Transfers General government Public safety Highways and streets Recreation and culture Community development
$ 53,931 66,423 680,361 123,523 2,195 32,173 42,723 92,323 27,697 1,026$30,331 5;741 710 Governmental Funds Capital Assets June 30, 2006$ 55,773 103,405 771,974 142,629 1,082$ 1,074,863 8,591 2,139 Total governmental funds capital assets$ 926,433 $ 195,942 $ 47,512 83
-. .........
.I ..............
4! .............-I I-City of Riverside Statistical Section For the year ended June 30, 2007 Table of Contents This part of the City's comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City's overall financial health.Contents Paue Financial Trends 86 These schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time.Revenue Capacity 92 These schedules contain information to help the reader assess the factors affecting the City's ability to generate property and sales taxes.Debt Capacity 101 These schedules present information to help the reader assess the affordability of the City's current levels of outstanding debt and the City's ability to issue additional debt in the future.Demographic and Economic Information 108 These schedules offer demographic and economic indicators to help the reader understand the environment within which the City's financial activities take place and to help make comparisons over time and with other governments.
Operating Information 111 These schedules contain information about the City's operations and resources to help the reader understand how the City's financial information relates to the services the City provides and the activities it performs.Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial reports for the relevant year. The City implemented Statement 34 in the year ended June 30, 2001; schedules presenting government-wide information include information beginning in that year.
Table 1 City of Riverside Net Assets by Component Last Seven Fiscal Years (accrual basis of accounting) (ntosns (in thousands)
Governmental activities Invested in capital assets, net of related debt Restricted Unrestricted Total governmental activities net assets Business-type activities Invested in capital assets, net of related debt Restricted Unrestricted Total business-type activities net assets Primary government Invested in capital assets, net of related debt Restricted Unrestricted Total primary government net assets Fiscal Year 2001 2002 2003 2004 2005 2006 2007$ 422,886 $ 465,803 $ 471,380 $ 484,784 $ 515,354 $ 622,336 $ 71 2,801 106,320 115,352 106,862 137,126 154,957 158,038 415,618 (54,406) (59,893) (10,227) (41,353) (46,419) (51,261).
(335,928)$ 474,800 $ 521,262 $ 568,015 $ 580,557 $ 623,8 92 $ 729,113 $ 792,491$ 279,165 $ 293,936 $ 323,094 $ 341,041 $ 402,377 $ 425,285 $ 520,059 31,154 38,535 40,869 49,242 54,540 71,386 57,613 172,344 177,537 .181,985 217,762 229,462 250,041 242,966$ 482,663 $ 510,008 $ 545,948 $ 608,045 $ 686,379 $ 746,712 $ 820,638$ 702,051 $ 759,739 $ 794,474 $ 825,825 $ 917,731 $ 1,047,621
$ 1,232,860 137,474 153,887 147,731 186,368 209,497 .229,424 473,231 117,938 117,644 171,758 176,409 183,043 198,780 (92,962)$ 957,463 $1,031,270
$ 1,113,963
$ 1,188,602
$ 1,310,271
$ 1,475,825
$ 1,613,129 The City of Riverside implemented GASB 34 for the fiscal year ended June 30, 2001. Information prior to the implementation of GASB 34 is not available.
86 Table 2 City of Riverside Changes in Net Assets Last Seven Fiscal Years (accrual basis of accounting) (in thousands)
Page 1 of 2 Expenses Governmental activities:
General government Public safety Highways and streets Culture and Recreation Interest on long-term debt Total governmental activities expenses Business-type activities:
Electric Water Sewer Refuse Airport Transportation Public parking Total business-type activities expenses Total primary government expenses Program Revenues Governmental activities:
Charges for services: General government Public safety Highways and streets Culture and recreation Operating grants and contributions Capital grants and contributions Total governmental activities program revenues Business-type activities:
Charges for services:.
Electric Water Sewer Refuse Airport Transportation Public parking Operating grants and contributions Capital grants and contributions Total business-type activities program revenues Total primary government program revenues Fiscal Year 2001 2002 2003 2004 2005 2006 2007$ 60,688 $ 47,245 ,$ 59,530 $ 63,000 $ 58,460 $ 74,458 $105,486 71,285 80,944 88,969 102,500 110,969 120,470 114,312 12,277 6,819 15,625 22,017 20,364 20,757 22,556 10,512 29,607 29,236 22,988 26,353 32,602 28,016 8,083 7,727 7,696 10,996 15,885 16,358 26,378 162,845 172,342 201,056 221,501 232,031 264j645 296,748 251,185 215,131 186,917 196,727 200,030 226,186 232,346 27,460 28,978 29,715 33,921 36,709 39,486 42,108 19,463 19,214 20,053 23,273 26,108 27,299 29,510 11,069 10,821 11,577 11,510 12,841 14,546 16,490 892 1,045 1,151 1,088 1,185 1,004 1,201 1,580 1,735 2,110 2,286 2,557 2,917 2,831-- 1,392 1,389 824 2,701 3,762 311,649 276,924 252,915 270,194 280,254 314,139 328,248$ 474,494 $449,266 $453,971 $491,695 $512,285 $578,784 $624,996$ 27,910 $ 20,265 $ 22,675 $ 26,160 $ 25,995 $ 24,683 $ 10,245 6,680 5,855 6,427 6,799 6,982 5,845 12,410 22,067 18,891 20,867 22,286 23,108 25,412 30,563 5,121 4,671 8,304 5,056 7,002 7,716 8,302 3,490 7,257 12,716 12,935 16,140 13,150 12,101 617 19,528 2,144 1,136 5,292 18,618 10,557 65,885 76,467 73,133 74,372 84,519 95,424 84,178 259,420 216,106 204,293 233,102 252,322 259,572 278,888 26,597 29,527 28,637 32,382 34,002 37,613 47,080 20,428 20,457 21,172 21,672 21,967 21,510 24,057 11,475 11,220 .11,795 13,759 14,492 15,160 15,833 955 1,089 1,046 1,051 1,088 1,162 1,263-137 116 170 185 200 238 302-- 2,385 2,760 2,961 2,837 3,431 2,411 2,992 3,663 1,723 2,261 2,704 1,939 3,293 1,877 4,976 26,390 32,317 29,293 40,066 324,716 283,384 278,137 333,024 361,610 370,089 412,859$ 390,601 $359,851 $351,270 $407,396 $446,129 $465,513 $497,037 continued 87 Table 2 City of Riverside Changes in Net Assets Last Seven Fiscal Years (accrual basis of accounting) (in thousands)
Page 2 of 2 Fiscal Year 2001 2002 2003 2004 2005 2006 2007 Net Revenues (Expense)Governmental activities
$ (96,960) $ (95,875) $(127,923)
$(147,129)
$(147,512)
$ (169,221)
$- $(212,570)
Business-type activities.
13,067 6,460 25,222 62,830 81,356 55,950 -84,611 Total primary government net expense $ (83,893) $ (89,415) $(102,701)
$ (84,299) $ (66,156) $(113,271)
$. $127,959)General Revenues and Other Changes in Net Assets Governmental activities:
Taxes Sales $ 33,981 $ 38,467 $ 41,691 $ 46,624 $ 53,348 $ 57,522 $ 55,666 Property 35,037 29,471 33,584 35,911 61,553 80,934 106,114 Utility Users 3,746 18,510 19,928 21,362 22,133 23,502 25,384 Franchise 19,613 4,070 3,811 4,261 4,481 4,813 5,031 Other 2,725 2,777 2,967 3,213 3,828 4,372 3,581 Intergovernmental, unrestricted 13,772 14,848 15,533 12,528 1,795 1,747 1,863 Unrestricted grants and contributions
---18,710 15,220 39,653 -29,743 Investment earnings 13,297 11,058 8,064 1,284 7,815 10,150 18,582 Miscellaneous 14,091 5,079 2,241 5,476 5,756 26,173 4,228 Transfers 17,527 18,057 18,218 10,302 14,918 25,576 31,171 Contributions
---(2,800) --Total governmental activities 153,789 142,337 146,037 156,871 190,847 274,442 281,363 Business-type activities:
Unrestricted grants and contributions 19,501 12,638 15,972 ---Investment income 16,022 12,780 9,115 5,016 7,548 11,259 16,988 Miscellaneous 2,414 5,624 3,849 4,553 7,362 18,700 3,498 Special item 2,982 7,900 --(3,014) -Transfers (17,527) (18,057) (18,218) (10,302) (14,918) (25,576) (31,171)Total business-type activities 23,392 20,885 10,718 (733) (3,022) 4,383 (10,685)Total primary government
$177,181 $ 163,222 $ 156,755 $ 156,138 $ 187,825 $ 278,825 $ 270,678 Change in Net Assets Governmental activities
$ 56,829 $ 46,462 $ 18,114 $ 9,742 $ 43,335 $ 105,221 $ 68,793 Business-type activities 36,459 27,345 35,940 62,097 78,334 60,333 73,926 Total primary government
$ 93,288 $ 73,807 $ 54,054 $ 71,839 $ 121,669 $ 165,554 $ 142,719 The City of Riverside implemented GASB 34 for the fiscal year ended June 30, 2001. Information prior to the implementation of GASB 34 is not available.
88 Table 3 City of Riverside Fund Balances of Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) (in thousands)
General fund Reserved Unreserved Total general fund All other governmental funds Reserved Unreserved, reported in: Special revenue funds Capital projects funds Permanent funds Total all other governmental funds 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007$ 5,008 $ 4,245 $ 11,049 $ 9,089 $ 10,947 $ 14,362 $ 17,268 $ 44,487 $ 59,930 $ 50,631 27,061 28,149 33,643 61,048 63,829 67,376 117,259 109,266 68,967 44,135$ 32,069 $ 32,394 $ 44,692 $ 70,137 $ 74,776 $ 81,738 $134,527 $153,753 $128,897 $ 94,766 23,638 30,346 25,564 30,589 29,856 28,123 35,177 47,677 54,173 99,986 8,415 21,992 23,945 12,350 12,168 14,691 14,960 24,991 26,718 22,731 48,765 63,034 68,027 65,698 67,211 69,444 93,722 89,303 94,070 307,224--1,355 1,457 1,232 1,219 127 81 -$ 80,818 $115,372 $117,536 $109,992 $110,692 $113,490 $145,078 $162,098 $175,042 $ 429,941 89 Table 4 City of Riverside Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years (modified accrual basis accounting) (in thousands)
Page I of 2 Revenues: Taxes Licenses and permits Intergovernmental Charges for services Fines and forfeitures Special assessments Use of money and property Miscellaneous Total revenues Expenditures:
General government Public safety Highways and streets Culture and recreation Capital outlay Debt Service: Principal Interest Debt issuance costs Total expenditures Excess of revenues over (under) expenditures 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007$ 72,936 $ 77,617 $ 84,445 $ 88,121 $ 93,879 $102,286 $113,118 $142,056 $ 170,638 $ 191,131 6,331 7,854 12,273 13,232 12,317 14,394 11,343 14,389 16,351 12,984 35,534 44,055 42,259 48,960 47,410 43,829 42,609 42,568 55,178 47,934 5,499 6,922 7,160 7,879 7,866 8,878 10,046 11,299 11,538 11,914 872 1,702 2,226 2,330 2,346 2,095 2,188 2,006 2,098 2,778 4,018 4,060 6,587 5,258 5,420 6,324 10,259 6,272 6,247 6,170 11,878 11,856 12,470 22,329 13,017 11,255 10,587 10,915 14,324 22,587 4,828 4,503 7,900 6,325 4,816 5,042 7,133 9,996 8,502 6,164$141,896 $158,569 $175,320 $ 194,434 $187,071 $194,103 $207,283 $239,501 $284,876 $ 301,662$ 24,318 $ 22,046 $ 19,942 $ 28,552 $ 27,748 $ 22,031 $ 36,938 $ 28,800 $ 49,381 $ 51,413 70,116 72,687 76,386 84,134 91,245 96,487 107,637 119,036 131,688 153,226 7,071 9,292 9,388 9,979 10,551 12,034I 12,124 13,446 12,171 20,760 16,933 17,573 18,856 21,239 23,835 27,579 25,919 34,180 34,264 36,449 25,497 30,647 36,784 33,195 41,058 39,098 37,035 48,366 87,972 117,070 23,445 7,082 14,559 9,326 6,174 4,470 2,422 8,599 9,733 12,045 9,130 9,285 8,268 8,154 7,785 7,785 9,945 15,025 19,205 21,330-2,185 469 ---950 1,538 -2,551$176,510 $170,797 $184,652 $ 194,579 $208,396 $209,484 $232,970 $268,990 $344,414 $ 414,844$ (34,614) $ (12,228) $ (9,332) $ (145) $ (21,325) $ (15,381) $ (25,687) $ (29,489) $ (59,538) $(113,182) continued 90 Table 4 City of Riverside Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years (modified accrual basis accounting) (in thousands)
Page 2 of 2 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Other financing sources (uses): Transfers in Transfers out Sales of general capital assets Advances from other funds Long-term obligation proceeds Premiums on bonds issued Payments to refunded bond agent Total other financing sources (uses)Special item -pension contribution
$ 49,869 $ 39,089 $ 32,914 $ 41,364 $ 31,305 $ 36,202 $ 41,440 $49,944 $ 59,545 $ 84,306 (31,612) (21,258) (15,902) (23,837) (13,248) (17,984) (31,338) (35,026) (33,969) (53,135)1,304 (225) (191) 168 153 1,314 (675) 6,230 1,281 541 2,052 918 613 1,599 ---3,379 48,936 6,360 -8,454 750 247,594 85,578 20,969 295,190------113 -4,455-(20,360) ----(58,657) (9,167) --24,992 47,100 23,794 19,294 26,664 20,363 198,364 97,672 47,826 331,357 (88,300) (32,141)Net change in fund balances Debt service as a percentage of noncapital expenditures
$ (9,622) $ 34,872 $ 14,462 , $ 19,149 $ 5,339 $ 4,982 $ 84,377 $ 36;042 $ (11,712) $218,175 10.000% 10.100% 12.240% 10.010% 8.300%(1)6.640% 31.350% 16.200% 14.390% 16.410%(2) (2)(1) Higher than average debt service included $16 million interfund advance payoff.(2) Restatement of debt service principal payments to reflect proper reporting of payment to refunded bond agent for refundingsduring the fiscal year.91 Table 5 City of Riverside Business-Type Activities Electricity Revenue By Source Last Seven Fiscal Years (accrual basis of accountinq)(in thousands)
Fiscal Residential Commerical Year Sales Sales 2001 2002 2003 2004 2005 2006 2007$ 65,426 64,625 68,649 80,872 79,786 85,243 94,426$ 45,478 46,265 48,974 57,079 59,998 53,773 55,421 Industrial Sales$ 51,558 49,487 52,380 56,117 59,157 71,084 83,698 Wholesale Sales-Other Other Transmission Operating Total Sales Revenue Revenue Revenues$ 73,090 46,505 17,806 9,581 15,249 11,952 9,913$ 21,897 7,447 5,619 6,354 6,337 7,139 5,713$8,661 20,917 20,213 20,043 20,097$ 1,971 1,777 2,230 2,182 12,697 9,183 9,536$ 259,420 216,106 204,319 233,102 253,437 258,417 278,804 The City started receiving Transmission Revenue in 2003.The City of Riverside implemented GASB 34 for the fiscal year ended June 30, 2001.implementation of GASB 34 is not available.
information prior to the 92 Table 6 City of Riverside Governmental Activities Tax Revenues By Source Last Seven Fiscal Years (accrual basis of accountina)(in thousands)
Fiscal Year Sales Tax 2001 2002 2003 2004 2005 2006 2007$ 35,037 38,467 41,691 46,624 53,348 57,522 55,666 Property Tax$ 33,981 29,471 33,584 35,911 61,553 80,934 106,114 Utility Users Tax Franchise Tax$ 19,613 18,510 19,928 21,362 22,133 23,502 25,384$ 3,746 4,070 3,811 4,261 4,481 4,813 5,031 Other Tax$ 2,725 2,777 2,967 3,213 1,795 4,372 3,581 Total Taxes$ 95,102 93,295 101,981 111,371 143,310 171,143 195,776 The City of Riverside implemented GASB 34 for the fiscal year ended June 30, 2001. Information prior to the implementation of GASB 34 is not available.
93 Table 7 City of Riverside Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years (in thousands)
City Redevelopment Agency Fiscal Year Ended June 30 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Secured$ 10,188,885 10,158,747 10,557,523 11,269,877 12,103,179 13,071,416 14,188,658
.15,540,982 17,557,341 20,672,126 Unsecured$ 540,358 576,029 632,940 686,215 799,323 980,529 845,858 951,211 1,058,995 1,140,891 Less: Exemptions (1,840,080)
(1,819,089)
(1,899,625)
(2,017,543)
(2,129,115)
(2,406,961)
(2,526,503)
(2,751,844)
(4,002,177)
(5,417,388)
Taxable Assessed Value$ 8,889,163 8,915,687 9,290,838 9,938,549 10,773,387 11,644,984 12,508,013 13,740,349.
14,614,159 16,395,629 Taxable Less: Assessed Secured Unsecured Exemptions Value Total Direct Tax Rate N/A N/A N/A N/A 1,240,768 1,390,108 1,508,478 1,775,655 2,914,600 4,145,700 N/A N/A N/A N/A 205,181 276,506 228,775 158,148 210,025 410,625 N/A N/A N/A N/A (16,263)(27,690)(30,286)(33,654)(51,992)(93,261)N/A N/A N/A N/A 1,429,686 1,638,924 1,706,967 1,900,149 3,072,633 4,463,064 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.010 1.009 1.009 Notes: In 1978 the votersof the State of California passed Proposition 13 which limited property taxes to a total maximum rate of 1% based upon the assessed value of the property being taxed. Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only re-assessed at the time that it is sold to a new owner. At that point, the new assessed value is reassessed at the purchase price of the property sold. The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property and is subject to the limitations described above.Assessed valuations are based on 100 percent of estimated actual value.NA -not available Source: Riverside County Auditor-Controller 94 Table 8 City of Riverside Direct and Overlapping Property Tax Rates Last Ten Fiscal Years City Direct Rates Overlapping Rates Fiscal Year 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Basic Rate 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 General Obligation Debt Service 0.010 0.009 0.008 Total Direct Rate 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.010 1.009 1.008 Alvord Unified School District 0.041 0.095 0.116 0.134 0.128 0.116 0.076 0.075 0.073 0.058 Jurupa Unified School District Riverside Unified School District ivMoreno Valley Unified School District 0.000 0.000 0.060 0.060 0.060 0.060 0.029 0.050 0.050 0.040 0.041 0.035 0.007 0.034 0.031 0.023 Notes: In 1978, California voters passed Propostion 13 which sets the property tax rate at a 1.00% fixed-amount.
This 1.00% is shared by all taxing agencies for which the subject property resides within. In addition to the 1.00% fixed amount, property owners are charged taxes as a percentage of assessed property values for the payment of the various intergovernmental overlapping debt.Source: Riverside County, Auditor-Controller's Office 95 Table 9 City of Riverside Principal Property Taxpayers June 30, 2007 (in thousands) 2007 1998 Taxable Assessed Value Percentage of Total Taxable Assessed Rank Value Taxable Assessed Value Percentage of Total Taxable Assessed Rank Value Property Owner Tyler Mall LTD Partnership
$ 154,056 BRE Prop. Inc. 147,691 La Sierra University 112,207 Riverside Healthcare System 103,978 State Street Bank 81,756 Centex Homes 78,112 Rohr/Goodrich 66,894 La Sierra College 64,230 Riverside Plaza 63,553 Press Enterprise 61,540 Ohio Teacher Retirement Metal Container Corp Wal Mart Stores Secretary Housing/Urban Dev of Washington D.C.Charter Communications Entertainment RREEF America Reit Corp 1 2 3 4 5 6 7 8 9 10 0.7%0.7%0.5%0.5%0.4%0.4%0.3%0.3%0.3%0.3%80,078 79,228 64,391 44,175 132,799 42,847 36,701 33,917 32,310 32,063 2 3 4 5 1 6 7 8 9 10 0.8%0.8%0.7%0.4%1.4%0.4%0.4%0.3%0.3%0.3%Totals$ 934,017 4.5%578,509 5.8%Notes: The amounts shown above include assessed value data for both the City and the Redevelopment Agency.Source: California Municipal Statistics, Inc.96 Table 10 City of Riverside Property Tax Levies and Collections Last Ten Fiscal Years (in thousands)
Fiscal Year Ended June 30 Total Tax Collected within the Levy for Fiscal Year of the Levy Fiscal Year Amount Percentage of Levy 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007$ 22,429 23,113 24,241 25,205 25,237 26,050 31,954 37,144 53,680 74,305$ 21,055 21,888 23,431 24,436 23,098 25,186 31,092 36,004 51,503 66,751 93.9%94.7%96.7%96.9%91.5%96.7%97.3%96.9%95.9%89.8%Delinquent Tax Collections for Fiscal Year$ 584 537 626 370 513 603 966 706 746 934 Total Fiscal Year Collections Amount Percentage of Levy$21,639 22,425 24,057 24,806 23,611 25,789 32,058 36,710 52,249 67,685 96.5%97.0%99.2%98.4%93.6%99.0%100.3%98.8%97.3%91.1%Notes: The table includes the City of Riverside Redevelopment Agency. Total Tax collections include supplemental tax levies not included in the total tax levy column.Source: Riverside County Auditor Controller's Office 97 Table 11 City of Riverside Electricity Sold by Type of Customer, Last Ten Fiscal Years (in millions of kilowatt-hours)
Type of Customer: Residential Commercial Industrial Wholesale sales Other Fiscal Year 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 555.0 575.0 594.0 610.0 600.0 618.0 707.0 675.0 696.0 748.0 404.0 406.0 436.0 432.0 434.0 451.0 522.0 530.0 474.0 456.0 620.0 619.0 651.0 654.0 629.0 658.0 687.0 707.0 810.0 924.0 135.0 151.0 419.0 600.0 541.0 378.0 354.0 470.0 287.0 295.0 45.0 46.0 53.0 54.0 53.0, 49.0 52.0 50.0 58.0 39.0 1,759.0 1,797.0 2,153.0 2,350.0 2,257.0 2,154.0 2,322.0 2,432.0 2,325.0 2,462.0 3.06 3.06 3.06 3.06 3.06 3.18 3.28 3.36 3.36 5.00 20.18 20.18 20.18 20.18 20.18 20.98 21.65 22.20 22.20 22.20 Total Total direct rate Monthly Base Rate 1 Rate per 250 KWH Rates are based on a monthly base rate plus energy charge for the first 250 KWH.The Utility charges an excess use rate 'over 250 KWH.Source: Riverside Public Utilities, Finance Services 98 Table 12 City of Riverside Electricity Rates Last Ten Fiscal Years (Average Rate in Dollars per Kilowatt-Hour)
Fiscal Year Ended June 30 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Residential 0.10726 0.10744 0.10767 0.10798 0.10768 0.10990 0.11439 0.11813 0.12222 0.12621 Commercial 0.10663 0.10632 0.10640 0.10637 0.10615 0.10779 0.10936 0.11321 0.11330 0.12164 Industrial 0.08298 0.08163 0.08081 0.07925 0.07844 0.07901 0.08167 0.08369 0.08798 0.09059 Other 0.11385 0.11319 0.11090 0.11112 0.11206 0.11869 0.12271 0.12768 0.12373 0.14493 NOTE: Rates are based on a monthly base rate plus an energy charge for the first 250 KWH. The Utility charges an excess use rate over 250 KWH.Source: Riverside Public Utilities, Finance Services 99.
Table 13 City of Riverside Top 10 Electricity Customers Current Year and Nine Years Ago 2007 Percent of Electricity Total Electric Charges Revenues 1998 Percent of Electricity Total Electric Charges Revenues Electricity Customer County Agency State University Local Government Local School District Grocery Store Corporation Shopping Mall Hospital Corporation Corporation
$ 6,737,345 6,208,160 6,190,517 3,858,521 2,997,336 2,267,071 2,040,225 1,664,993 1,653,565 1,614,061 2.82%2.59%2.59%1.61%1.25%0.95%0.85%-0.70%0.69%0.67%N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A$ 35,231,794 14.73%N/A N/A Retail Sales Per Financial Statements
$ 239,258,513 N/A -not available Source: Riverside Public Utilities, Finance Services 100 Table 14 City of Riverside Ratios of Outstanding Debt by Type Last Ten Fiscal Years (in thousands)
General Fiscal Obligation Year Bonds Governmental Activities Pension Assessment Obligation Bonds Bonds 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007$Redevelopment Bonds$ 95,774 116,600 115,605 113,980 111,880 109,615 131,590 144,024 140,195 296,598 Revenue Bonds$ 10,295 8,595 6,795 2,830 525$ 480 285 245 195 135$Certificates of Participation
$ 7,865 7,440 6,050 5,615 5,150 4,650 58,706 57,336 55,571 192,874$ 4,666 5,375 4,719 7,316 6,430 5,517 8,938 7,431 6,008 4,929$ 9,571 13,674 12,998 11,629 11,096 11,447 11,057 10,645 10,215 9,759 Capital Notes Leases Payable 20,285 20,280 19,858 19,331 89,540 148,280 146,470 144,450 Business-Type Activities Fiscal Year 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Revenue Bonds$ 331,592 321,058 310,424-299,244 355,621 342,559 440,970 419,581 509,577 482,929 Loans Payable$7,956 7,956 7,315 6,966 11,524 11,066 10,459 9,841 9,211 Capital Leases$ 107 428 409 653 571 498 439 392 317 253 Total Primary Government
$ 460,350 481,411 465,201 448,777 498,374 485,810 772,591 818,428 898,052 1,160,334 Percentage of Personal Income 13.62%13.43%12.96%12.01%13.70%12.54%18.68%19.02%14.29%17.37%Per Capita 1.84 1.89 1.79 1.71 1.88 1.77 2.79 2.87 3.12 3.92 Source: City of Riverside Notes to Financial Statements and Statistical Table 19.101 Table 15 City of Riverside Ratios of General Bonded Debt Outstanding Last Ten Fiscal Years General Fiscal Obligation Pension Year Bonds Bonds 1998 $ $Certificates of Participation 1999 2000 2001 2002 2003 2004 2005 2006 2007 Tax Allocation Bonds 2$ 95,774 116,600 115,605 113,980 111,880 109,615 131,590 144,024 140,195 291,776 (in thousands, except per capita amount)Percent of Assessed Pe Total Value 1 Cap$ 95,774 1.08% $116,600 1.31%115,605 1.24%113,980 1.15%111,880 1.04%109,615 0.94%300;121 2.40% 1 369,920 2.69% 1 362,094 2.48% 1 648,431 3.95% 2 r ita 396 483 478 472 463 454 ,242 ,531 ,499 ,193 20,285 20,280 19,858 19,331 89,540 148,280 146,470 144,450 58,706 57,336 55,571 192,874 Notes: General bonded debt is debt payable with governmental fund resources and general obligation bonds recorded in enterprise funds (which, the City has none.)Assessed value has been used because the actual value of taxable property is not readily available in the State'of California.
2 Amount presented is net of restricted resources held for the repayment of outstanding debt principal.
Source: City of Riverside Notes to Financial Statements and Reserve Cash Reconciliation maintained by City Finance Division.102 Table 16 City of Riverside Direct and Overlapping Debt As of June 30, 2006 Page I of 2 City Assessed Valuation:
Redevelopment Agency Incremental Valuation:
Adjusted Assessed Valuation:
Direct and Overlapping Tax and Assessment Debt: Metropolitan Water District Riverside City Community College District Alvord Unified School District Riverside Unified School District Corona-Norco Unified School District Jurupa Unified School District Moreno Valley Unified School District City of Riverside Riverside Unified School District Community Facilities Districts City of Riverside Community Facilities Districts City of Riverside 1915 Act Bonds Total Direct and Overlapping Tax and Assessment Debt: Percentage Applicable 3 1.017%30.102%67.749%84.037%0.002%0.001%4.005%100%96.650-100%
100%100%$ 16,395,628,541 4,463,063,852
$ 11,932,564,689 Outstanding Debt 06/30/2006
$ 3,961,876 20,149,108 32,282,399 99,239,293 1,090 561 2,002,498 19,590,000 94,426,090 54,223,000 43,220,000
$ 369,095,915 Estimated Share of Overlapping Debt$ 40,292 6,065,284 21,871,002 83,397,725 0 0 80,200 19,590,000 91,262,816 54,223,000 43,220,000
$ 319,750,320 continued 103 Table 16 City of Riverside Direct and Overlapping Debt As of June 30, 2006 Page 2 of 2 Direct and Overlapping General Fund Debt: Riverside County General Fund Obligations Riverside County Pension Obligations Riverside County Board of Education Certificates of Participation Alvord Unified School District Certificates of Participation Corona-Norco Unified School District Certificates of Participation Jurupa Unified School District Certificates of Participation Moreno Valley Unified School District Certificates of Participation Riverside Unified School District General Fund Obligations City of Riverside General Fund Obligations City of Riverside Pension Obligations Total Gross Direct and Overlapping General Fund Debt: Less: Riverside County Self-Supporting Obligations Total Net Direct and Overlapping General Fund Debt: 12.065%12.065%12.065%67.748%0.002%0.001%4.005%84.037%100%100%$ 76,072,910 47,879,349 1,356,106 16,350,980 1,668 80 1,072,739 22,122,740 55,315,000 146,470,000 366,641,572 2,363,665$ 364,277,907
$ 9,178,197 5,776,643 163,614 11,077,462 0 0 42,963 18,591,287 55;315,000 (1)146,470,000 246,615,166 2,363,665$ 244,251,501
$ 564,001,821
$ 566,365,486 (2)Net Direct and Overlapping Debt: Gross Direct and Overlapping Debt: (1)(2)(3)Excludes certificates of participation to be sold Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds and non-bonded capital lease obligations.
For debt repaid with property taxes, the percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable percentages were estimated by determining the portion of another governmental unit's taxable assessed value that is within the city's boundaries and dividing it by each unit's total taxable assessed value.Overlapping governments are those that coincide at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the City. This process recognizes that, when considering the City's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government.
Source: California Municipal Statistics, Inc.Note: July 1, 2006 is the latest information available from the California Municipal Statistics, Inc. for this schedule.104 Table 17 City of Riverside Legal Debt Margin Information Last Ten Fiscal Years (in thousands)
Assessed valuation Conversion percentage Adjusted assessed valuation Debt limit percentage Debt limit General obligation bonds Pension obligation bonds Total net debt applicable to limit: Legal debt margin Total net debt applicable to the limit as a percentage of debt limit 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007$8,889,163
$8,915,687
$9,290,838
$9,938,549
$10,773,387
$11,644,984
$12,508,013
$13,740,349
$14,614,159
$16,395,629 25% 25% 25% 25% 25% 25% 25% 25% 25% 25%2,222,291 2,228,922 2,322,710 2,484,637 2,693,347 2,911,246 3,127,003 3,435,087 3,653,540 4,098,907 15% 15% 15% 15% 15% 15% 15% 15% 15% 15%333,344 334,338 348,406 372,696 404,002 436,687 469,050 515,263 548,031 614,836--20,285 20,280 19,858 19,331 89,540 148,280- 146,470 144,450 109,825 168,560 166,328 163,781$ 333,344 $ 334,338 $ 348,406 $ 372,696 $ 404,002 $ 436,687 $ 359,225 $ 346,703 $ 381,703 $ 451,055 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 23.4% 32.7% 30.4% 26.6%The Government Code of the State of California provides for a legal debt limit of 15% of gross assessed valuation.
However, this provision was enacted when assessed valuation was based upon 25% of market value. Effective with the 1981-82 fiscal year, each parcel is now assessed at 100% of market value (as of the most recent change in ownership for that parcel). The computations shown above reflect a conversion of assessed valuation data for each fiscal year from the current full valuation perspective to the 25% level that was in effect a the time that the legal debt margin was enacted by the State of California for local governments located within the State.Source: City of Riverside, Statistical Table 6 and Notes to Financial Statements.
105 Table 18 City of Riverside Pledged-Revenue Coverage Governmental Activity Debt Last Ten Fiscal Years (in thousands)
Tax Allocation Bonds Debt Service Fiscal Year 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Tax Increment$ 11,179 11,832 12,829 13,279 14,859 16,180 17,410 21,242 35,268 49,772 Principal Interest$ 1,902 2,466 1,894 3,099 2,745 2,694 1,873 (1)4,507 (1)4,390 4,727 Coverage$ 7,540 7,970 7,194 7,363 7,252 7,371 9,599 6,307 7,236 7,663 1.18 1.13 1.41 1.27 1.49 1.61 1.52 1.96 3.03 4.02 Source: Annual Financial Report, Redevelopment Agency (1) Restatement of debt service principal payments to reflect proper reporting of payment to refunded bond agent during the fiscal year.106 Table 19 City of Riverside Pledged-Revenue Coverage Business Type Activity Debi Last Ten Fiscal Years (in thousands)
Electric Revenue Bonds Water Revenue bonds Utility Fiscal Service Year Charges 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007$ 207,934 180,171 197,842 271,828 229,529 211,553 239,842 271,987 275,478 301,414* Less: Operating Expenses$ 143,828 145,402 150,175 227,081 190,426 157,450 168,162 169,064 191,758 192,450 Net Available Revenue$ 64,106 34,769 47,667 44,747 39,103 54,103 71,680 102,923 83,720 108,964 Debt Service Principal Interest Utility Service Coverage Charges$ 6,635 6,555 6,610 6,930 7,385 7,840 10,780 14,555 15,015 18,815$ 10,371 10,701 10,669 10,350 9,841 10,966 10,183 12,143 14,545 13,549 3.77 $ 26,126 2.01 30,739 2.76 33,327 2.59 36,259 2.27 43,215 2.88 36,837 3.42 47,093 3.86 45,626 2.83 51,313 3.37 70,736 Less: Operating Expenses$ 14,776 15,659 16,397 18,643 19,244 19,928 23,767 26,583 27,385 29,856 Net Available Revenue$ 11,350 15,080 16,930 17,616 23,971 16,909 23,326 19,043 23,928 40,880 Debt Service Principal Interest Coverage$ 2,265 2,780 2,755 2,955 3,215 3,895 4,010 4,045 3,875 4,300$ 2,642 2,667 2,591 2,364 2,941 2,720 2,622 2,591.3,388 3,113 2.31 2.77 3.17 3.31 3.89 2.56 3.52 2.87 3.29 5.51 Sewer Fiscal Charges Year and Other Less: Operating Expenses Sewer Revenue Bonds Net Available Del Revenue Principal bt Service Interest Coverage 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007$ 21,530 21,322 23,851 25,056 23,872 24,297 24,176 25,444 23,482 26,534$ 11,901 12,117 12,300 12,451 12,387 13,433 17,006 19,163 20,393 22,806$ 9,629 $ 2,075 9,205 2,200 11,551 2,330 12,605 2,435 11,485 2,550 10,864 2,665 7,170 2,800 6,281 2,970 3,089 3,120 3,728 3,285$ 2,792 2,662 2,557 2,729 2,423 2,165 2,341 2,061 1,691 1,469 1.98 1.89 2.36 2.44 2.3i 2.25 1.39 1.25 0.64 0.78 Source: City of Riverside, Propriety Fund Statement of Revenues, Expenses and Changes in Net Fund Balance.107 Table 20 City of Riverside Demographic and Economic Statistics Last Ten Fiscal Years Fiscal Year Population Personal Income (amounts expressed in thousands) 1998 250,799 $ 3,381,021,319 1999 254,300 3,583,849,900 2000 259,738 3,590,877,850 2001 262,335 3,735,912,735 2002 265,700 3,636,635,900 2003 274,100 3,874,951,700 2004 277,030 4,135,503,840 2005 285,537 4,303,042,590 2006 288,203 6,283,978,212 2007 295,730 6,681,723,620 Source: City of Riverside, Development Department Per Capita Personal Income$ 13,481 14,093 13,825 14,241 13,687 14,137 14,928 15,070 21,804 22,594 Unemployment Rate 7.0 6.2 5.3 5.2 6.5 6.8 6.2 5.9 5.4 6.5 108 Table 21 City of Riverside Principal Employers Current Year and Nine Years Ago 2007 1998 Percentage of Total City Employment Percentage of Total City Employment Employer Employees Rank Employees Rank University of California Riverside Unified School District City of Riverside Riverside Community College Fleetwood Motorhome Svc Alvord Unified School District Riverside Community Hospital Press-Enterprise.
Co Parkview Community Hospital Riverside Medical Clinic 6,470 4,000 2,600 2,000 1,875 1,669 1,600 1,090 1,000 600 1 2 3 4 5 6 7 8 9 10 4.2%2.6%1.7%1.3%1.2%1.1%1.0%0.7%0.6%0.4%N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Total 22,904 14.7% N/A N/A N/A -not available Source: City of Riverside, Development Department 109 Table 22 City of Riverside Full-Time Equivalent City Government Employees by Function Last Ten Fiscal Years Function General government Public safety Police Fire Firefighters and officers Highways and streets Sanitation Culture and recreation Airport Water Electric Total 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 283.38 273.50 276.22 288.26 313.29 314.39 318.36 331.88 377.15 412.22 531.70 530.70 534.95 544.65 560.65 569.65 567.83 568.83 589.33 618.33 187.64 187.64 188.64 218.64 217.65 218.65 219.65 221.11 221.73 251.73 266.00 266.10 267.10 269.10 266.10 280.10 285.10 281.35 262.35 286.35 44.49 44.49 44.49 44.49 44.49 44.49 48.49 48.49 59.49 60.29 244.42 249.28 256.52 265.08 282.93 301.97 302.92 300.92 311.45 324.26 5.00 5.00 5.00 5.00 6.00 6.00 6.00 6.00 6.00 7.00 128.00 119.00 121.00 122.00 123.00 123.00 130.00 130.00 133.00 142.00 277.71 273.60 276.60 280.60 282.60 291.60 295.60 305.60 337.60 351.35 1,968.34 1,949.31 1,970.52 2,037.82 2,096.71 2,149.85 2,173.95 2,194.18 2,298.10 2,453.53 Source: City of Riverside, Budget Office 110 Table 23 City of Riverside Operating Indicators by Function Last Ten Fiscal Years Function/Program 19 Police Arrests Fire Number of calls answered Inspections Public works: Street resurfacing (miles)Parks and recreation Number of recreation classes Number of facility rentals Water Number of accounts Annual consumption (ccf) 24,9 Electric Number of accounts Annual consumption (kwh) 1,624,, Sewer:.New connections Average daily sewage treatment (millions of gallons)1 Inspections were not tracked prior to 2003 N/A -not available Source: City of Riverside, various departments 98 12,243 21,639 N/A N/A 14,492 26,327 58,214 925,154 90,607 389,147 N/A 27.22 1999 11,034 20,920 N/A N/A 14,492 26,327 58,383 26,777,544 92,213 1,646,453,088 N/A 32.33 2000 8,756 22,824 N/A N/A 14,492 26,327 58,538 29,285,011 93,147 1,734,156,468 N/A 30.92 2001 9,638 23,968 N/A 109.09 14,492 26,327 58,905 28,044,248 95,205 1,749,842,407 4,073 32.59 Fiscal Year 2002 10,047 24,115 N/A 104.04 14,619 26,533 59,176 29,419,027 2 96,503 1,716,000,000 1,77 5,267 34.75 2003 10,541 24,886 14,229 67.39 S14,787 26,854 59,890 8,232,000 98,459'6,000,000 5,825 33.15 2004 11,951 25,876 16,306 62.37 15,135 27,014 61,668 30,407,000 100,766 1,968,000,000 7,034 35.24 2005 11,280 26,505 17,028 102.45 15,195 27,074 62,492 27,697,000 103,463 1,962,000,000 9,621 38.07 2006 10,093 26,696 19,261 51.26 16,272 27,483 62,985 28,682,000 104,294 2,038,000,000 16,717 35.91 2007 9,827 27,458 7,261 l1i 73.40 19,079 32,980 63,431 32,110,208 105,226 2,431,000 15,423 32.50-j IlI Table 24 City of Riverside Capital Asset Statistics by Function Last Ten Fiscal Years Function Public Safety Police Fiscal Year 1998 1999 2000 2001 2002 2003 2004 2005 (l) 2006 2007 Stations 2 2 2 2 2 2 2 2 3 3 Substations 9 9 9 9 9 7 11 7 5 4 Helicopters 4 4 4 4 4 4 4 4 4 4 Fire Stations 13 13 13 13 13 13 13 13 ~ 13 14 Active apparatus 25 25 26 26 26 30 30 30 29 30 Reserve apparatus 6 6 4 4 5 6 5 5 6 6 Training facilities 1 1 1 1 1 1 1 1 1 1 Highways and streets Streets (miles) 796.84 804.04 811.74 819.18 816.34 1,100.00 829.00 836.00 845.35 852.04 Streetlights 26,144 27,406 27,622 27,841 28,058 28,246 28,401 28,581 28,847 29,028 Traffic signals 283 283 287 299 320 320 322 322 353 358 Culture and recreation Parks acreage 2,465.60 2,664.60 2,664.60 2,664.60 2,665.00 2,534.00 2,500.00 2,534.00 2,534.00 2,800.00 Community centers 10 10 10 10 10 10 10 11 11 11 Playgrounds 31 31 32 32 35 30 26 26 27 38 Swimming pools 9 9 9 9 9 6 6 7 6 7 Softball & baseball diamonds 36 36 36 36 36 34 34 35 33 44 Library branches 5 5 5 5 5 7 5 5 6 6 Museum exhibit-fixed 65 51 51 51 51 52 11 8 7 13 Museum exhibit-special 4 7 7 7 11 13 4 1 -2 Museum reference library volumes 2,575 2,575 2,575 2,575 2,600 2,750 3,000 5,224 5,500 5,600 Water Fire hydrants 6,402 6,390 6,504 6,566 6,715 -6,763 6,763 6,926 7,127 7,187 Sewer Sanitary sewers (miles) 1,100 1,100 1,100 1,100 800 .750 755 755 810 840 Electric Miles of overhead distribution system 546.9 546.0 543.9 554.9 539.1 593.3 539.0 531.0 527.0 528.0 Miles of underground system 497.9 515.1 523.5 540.1 575.8 538.2 608.0 622.0 663.0 704.0 Source: City of Riverside, various departments (1) During the 2004/05 fiscal year, four police substations closed.112 Table 25 City of Riverside Cash Debt Reserves Tax Allocation Bonds Last Ten Fiscal Years (in thousands)
Tax Allocation Bond 1988 Issue Series A Revenue Bonds 1991 Issue $13,285,000 Series A 1994 Issue PFA Multiple Project Areas A/B 1994 Issue RDA CA Towers Series A 1994 Issue RDA CA Towers Series B 1999 Issue $17,025,000 Series A Univ Corr 1999 Issue $6,055,000 Series B Univ Corr 1999 Issue $20,395,000 Casa Blanca 2004 Issue A Arlington
$4,550,000 2004 Issue B Arlington
$2,975,000 2003 Issue A Cal Towers $26;255,000 2003 Issue B Cal Towers $4,810,000 2004 Issue A Multiple Project $24,115,000 2004 ERAF loan $1,465,000 2007 Issue PFA Mult Proj Areas A $8,340,000 2007 Issue PFA Mult Proj Areas B $14,850,000 2007 Issue PFA Mult Proj Areas C $9,205,000 2007 Issue PFA Mult Proj Areas D $43,875,000 Minimun Required Reserve$ 492 28 900 2,481 431 1,257 442 343 301 197 2,341 371 1,753 Cash Debt Reserve 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007$ 505 509 900 2,481 427$ -$ -$ -$ -$ -$ -$ -$79 900 2,699 465 1,257 442 344 75 911 2,699 465 1,259 442 340 76 927 2,699 417 1,220 442 340 76 902 2,411 431 1,256 443 341 74 904 2,411 431 1,257 442 344 29 906 1,257 442 344 299 195 2,342 371 29 29 29 1,257 442 344 305 199 2,342 371 1,753.1,257 442 344 309 198 2,342 371 1,753 1,257 442 348 309 193 2,342 371 1,753$ 11,337 $ 4,822 $ 6,186 $ 6,191 $ 6,121 $ 5,860 $ 5,863 $ 6,185 $ 7,042 $ 7,045 $ 7,044 113
-S-4~r
PREPARED BY DEPARTMENT OF FINANCE WILLIAM G. SWEENEY Finance Director
CITY OF ANAHEIM Comprehensive Annual Financial Report Table of Contents June 30, 2007 Page INTRODUCTORY SECTION Letter of Transmittal I GFOA Certificate of Achievement for Excellence in Financial Reporting 5 Organization Chart 7 Administrative Personnel 8 FINANCIAL SECTION Independent Auditors' Report 9 Management's Discussion and Analysis (Unaudited) 11 Basic Financial Statements Government-wide Financial Statements Statement of Net Assets 21 Statement of Activities 23 Fund Financial Statements Balance Sheet -Governmental Funds 25 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Assets 26 Statement of Revenues, Expenditures and Changes in Fund Balances -Governmental Funds 27 Reconciliation of Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities 28 Statement of Revenues, Expenditures and Changes in Fund Balance -Budget and Budgetary Basis Actual -General Fund 29 Statement of Revenues, Expenditures and Changes in Fund Balance -Budget and Budgetary Basis Actual -Housing Authority 30 Statemenit of Fund Net Assets -Proprietary Funds 31 Statement of Revenues, Expenses and Changes in Fund Net Assets -Proprietaiy Funds 33 Statement of Cash Flows -Proprietary Funds 34 Statement of Fiduciary Assets and Liabilities
-Agency Fund 36 Notes to the Financial Statements 37 Required Supplementary Information 66 Combining Individual Fund Statements and Schedules Nonmajor Governmental Funds Combining Balance Sheet -Nonmajor Governmental Funds by Fund Type 67 Combining Statement of Revenues, Expenditures and Changes in Fund Balances -Nonmajor Governmental Funds by Fund Type 68 Combining Balance Sheet -Nomnajor Special Revenue Funds 69 Combining Statement of Revenues, Expenditures and Changes in Fund Balances (Deficits)
-Nomnajor Special Revenue Funds 71 Schedule of Revenues, Expenditures and Changes in Fund Balances (Deficits)
-Budget and Budgetary Basis Actual -All Nonmajor Special Revenue Funds 73 (continued)
CITY OF ANAHEIM Comprehensive Annual Financial Report Table of Contents June 30, 2007 (continued)
Page Combining Balance Sheet -Nonmajor Debt Service Funds 78 Combining Statement of Revenues, Expenditures and Changes in Fund Balances -Nonmajor Debt Service Funds 79 Schedule of Revenues, Expenditures and Changes in Fund Balances -Budget and Budgetary Basis Actual -All Nonmajor Debt Service Funds 80 Combining Balance Sheet -Nonmajor Capital Projects Funds 82 Combining Statement of Revenues, Expenditures and Changes in Fund Balances -Nonmajor Capital Projects Funds 83 Schedule of Revenues, Expenditures and Changes in Fund Balances -Budget and Budgetary Basis Actual All Nonnajor Capital Projects Funds 84 Internal Service Funds Combining Statement of Fund Net Assets -Internal Service Funds 85 Combining Statement of Revenues, Expenses and Changes in Fund Net Assets -Internal Service Funds 86 Combining Statement of Cash Flows -Internal Service Funds 87 Fiduciary Funds Statement of Changes in Fiduciary Assets and Liabilities -Agency Fund -Mello-Roos 89 STATISTICAL SECTION (unaudited)
Net Assets by Component
-Last Six Fiscal Years 92 Changes in Net Assets -Last Six Fiscal Years 93 Governmental Activities Tax Revenues by Source -Last Six Fiscal Years 95 Fund Balances of Governmental Funds -Last Ten Fiscal Years 96 Changes in Fund Balances of Governmental Funds -Last Ten Fiscal Years 97 General Government Tax Revenues by Source -Last Four Fiscal Years 98 Assessed Value of Taxable Property -Last Four Fiscal Years 99 Property TaxRates -Direct and Overlapping Governments
-Last Four Fiscal Years 100 Principal Properly Tax Payers -Last Ten Fiscal Years 101 Property Tax Levies and Collections
-Last Four Fiscal Years 103 Ratios of Outstanding Debt by Type -Last Four Fiscal Years 104 Ratios of General Bonded Debt Outstanding
-Last Ten Fiscal Years 105 Direct and Overlapping Governmental Activities Debt 106 Legal Debt Margin Information
-Last Ten Fiscal Years 108 Pledged-Revenue Coverage -Last Ten Fiscal Years 109 Demographic and Economic Statistics
-Last Four Fiscal Years Ill Principal Employers
-Last Four. Fiscal Years 112 Full-time Equivalent City Government Employees by Function/Program
-Last Four Fiscal Years 113 Operating Indicators by Function -Last Four Fiscal Years 114 Capital Asset Statistics by Function -Last Four Fiscal Years 115 City of Anaheim Map 116 City of Anaheim, California Finance Department December 3, 2007 To the Honorable Mayor and City Council City of Anaheim Anaheim, California In accordance with the Charter of the City of Anaheim (City), we are submitting the Comprehensive Annual Financial Report (CAFR) for the fiscal year ended June 30, 2007. Responsibility for both the accuracy of the data and the completeness and fairness of the presentation, including all disclosures, rests with the City. We believe the data, as presented, is accurate in all material aspects; that it is presented in a manner designed to fairly set forth the financial position and results of operations of the City, as measured by the financial activity of its various funds; and that all disclosures necessary to enable the reader to gain maximum understanding of the City's financial activities have been included.The CAFR is presented in three sections:
Introductory, Financial, and Statistical.
The Introductory Section includes the table of contents, this transmittal letter, certificate of achievement, the City's organization chart, and a list of administrative personnel.
The Financial Section includes the report of the independent auditors, Management's Discussion and Analysis (MD&A), the basic financial statements including the government-wide financial statements comprised of the Statement of Net Assets and the Statement of Activities, and the accompanying notes to the financial statements.
The Financial Section also includes the fund financial statements including the governmental funds financial statements, the proprietary funds financial statements and the fiduciary fund financial statements.
This section also includes the combining individual funds financial statements for the nonmajor governmental funds and the internal service funds. The Statistical Section includes selected pertinent financial and demographic information,"on a multi-year basis. This transmittal letter is designed to complement and should be read in conjunction with the MD&A.In addition to the financial audit, the City is required to undergo an annual Single Audit in conformity with the provisions of the Single Audit Act Amendments of 1996 and the U.S. Office of Management and Budget (OMB) Circular A-]33, Audits of State, Local Governments, and Non-Profit Organizations.
The information related to the Single Audit, including the schedule of expenditures of federal awards, schedule of findings and questioned costs, and auditors' reports on internal control and compliance, is not included with this report and is issued as a separate document.This CAFR includes all funds of the City. The City provides a full range of services, including:
police and fire protection, highways and streets, public improvements, planning and zoning, utilities (electric and water), sanitation and solid waste, stadium, convention center, golf courses, street and park maintenance, recreational and cultural programs for citizen participation, and general administrative services.
In addition to general governmental activities, the City Council is financially accountable for the Anaheim Housing Authority, Anaheim Redevelopment Agency, Community Center Authority, Anaheim Public Improvement Corporation, and Anaheim Public Financing Authority; therefore, these activities are included in the reporting entity.ECONOMIC CONDITION AND OUTLOOK The City is located in northwestern Orange County, about 28 miles southeast of downtown Los Angeles and 90 miles north of San Diego. The City lies on a coastal plain, which is bordered by the Pacific Ocean on the west and the Santa Ana Mountains on the east. The City is the oldest and second most populous city in Orange County. Anaheim is home to the Disneyland Resort, the Anaheim Convention Center, and two major league professional sports teams-the Los Angeles Angels of Anaheim American League Baseball team that utilizes the Angel Stadium of Anaheim, and the Anaheim Ducks National Hockey League team that utilizes the Honda Center.Anaheim and Orange County are home to a wide spectrum of industries-more than 4,600 manufacturing plants are located in the county, most notably aerospace, electronics, machinery, computers, and food product manufacturers.
Unionization is prevalent in manufacturing, construction, hotels, trucking, warehousing, grocery stores, drug stores, and some larger retail outlets. High-tech businesses are typically nonunion.As the City continues to attract population growth and economic expansion, its municipal services are constantly being improved to serve residential and business needs. This growth in City service demand presents the City with significant challenges; and if the high level of service is to be maintained, the City will need to continue to explore new methods of obtaining financial resources and more efficient methods to deliver services.The unemployment rate in the Orange County, California area for June 2007 was 3.9%, which remained below both the state (5.2%) average and the national (4.5%) average.I CITY OF ANAHEIM Tourism related spending provides significant discretionary revenue to the City of Anaheim, and the City closely monitors and projects trends related to this market.Revenue from tourism was very strong in fiscal year 2007, and local economic forecasts indicate continued strength well into fiscal year 2008. The City's revenue from sales and use taxes continues to be a significant source of revenue, although there are indications that the growth in this revenue is slowing.MAJOR INITIATIVES The Anaheim City Council has provided policy and direction to lead the City on a path of long-term investment and improvement for the future. Four objectives have been identified to focus and guide the efforts of the City's overall workplan:* Vision* Responsibility
- Pride* Service The vision for our City was codified by the City Council's adoption of the most ambitious planning effort in City history, the updated General Plan and Zoning Code.As a result of extensive public input, the City created an opportunities-based, long-range planning tool created to address the livability of Anaheim's neighborhoods, beautification efforts, and new land use options for commercial properties, as well as the corresponding infrastructure and transportation needs. The new General Plan is a comprehensive guide for future development and associated City services and facilities.
It addresses the preservation and enhancement of neighborhoods and maximization of open space and recreational opportunities, as well as the continued development of The Anaheim Resort and Stadium Area. It also anticipates the completion of the Downtown Anaheim Revitalization Project, a vibrant City center and activity hub. In addition to the'. General Plan, the City Council also adopted a new overlay zone for the approximately 800-acre Platinum Triangle.
When completed, the Platinum Triangle will be a vibrant 24-hour, high density, mixed-use, urban environment unique to Orange County. The City is currently considering increasing the amount of allowable residential development from 10,266 to 18,363 dwelling units, commercial development from 2.2 million to over 5.5 million square feet and office,development from 5 million to over 16.8 million square feet. The introduction of mixed-use opportunities into this area will be the catalyst for realizing the development potential of the Platinum Triangle's strategic location and surrounding amenities including Angel Stadium of Anaheim, the Honda Center; The Grove of Anaheim and the Amtrak/Metrolink Station and proposed Anaheim Regional Transportation Intermodal Center (ARTIC).The City continues to draw from and build on its fiscal responsibility as it maximizes the assets under its control and direction.
These assets include the Angel Stadium of Anaheim, Honda Center, Anaheim Convention Center, the City's golf courses, and its Anaheim-owned, Anaheim-focused water and electric utilities.
Through sound fiscal management, the City continues to operate these economic engines at optimal levels to assist in better providing for the many other necessities of the community.
The re-dedication to neighborhood pride is another important facet of the City's planning and operations.
Various programs were established in the Other Capital Improvements Fund upon the completion of the Anaheim Resort Revitalization Project to direct increased revenues received from the City's investment in resort improvements toward continued improvements in our community.
This and other resources contribute toward infrastructure maintenance including roads, sidewalks, sewers, new and/or enhanced parks and open space, increased sports fields and gymnasiums, and facilities such as the West Anaheim Police Sub-station and Youth Center, the East Anaheim Gymnasium, East Anaheim Library, Anaheim Hills Golf Clubhouse, Haskett Library in Maxwell Park, the Twila Reid Fire Station, and the Tiger Woods Learning Center at Dad Miller Golf Course.The City's commitment to deliver unparalleled service continues to show Anaheim's commitment to being one of the finest municipal workforces in the nation. Anaheim has built a reputation on its consistent delivery of outstanding service that residents, businesses and guests have come to expect. The new Anaheim Anytime innovative web and phone systems foster a new communicative spirit among City employees and the community.
Each day, the 2,500 employees know they can positively affect change for the people who live, work, and visit our City.In addition to all of the major initiatives, the City has been celebrating its 150th anniversary.
The celebration officially began in October 2006 and events to mark this momentous milestone of the City's history will continue through 2007.FINANCIAL INFORMATION Management of the City is responsible for establishing and maintainilng internal control designed to ensure that the assets of the government are protected finom loss, theft, or misuse, and to ensure that adequate accounting data are compiled to allow for the preparation of financial statements in conformity with U. S. generally accepted accounting principles.
Internal control is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that: (1) the cost of a control should not exceed the benefits likely to be derived; and (2) the valuation of costs and benefits requires estimates and judgments by management.
2 CITY OF ANAHEIM This report consists of management's representations concerning the finances of the City. As a result, management assumes full responsibility for the completeness and reliability of all of the information presented in this report. Management asserts that, to the best of their knowledge and belief, this financial report is complete and reliable in all material respects.BUDGETARY CONTROLS:
The City maintains budgetary controls, the objective of which is to ensure compliance with legal provisions embodied in the annual appropriated budget approved by the City Council. Activities of the General Fund,-special revenue funds, debt service funds, capital projects funds, and all the proprietary funds are included in the annual appropriated budget. The level of budgetary control (that is, the level at which expenditures cannot legally exceed the appropriated amount)is established at the departmental level. The City also maintains an encumbrance accounting system as one technique of accomplishing budgetary control. Encumbrances generally are re-appropriated as part of the following year's budget.Regarding long-term financial planning, as of June 19, 2007, the City Council adopted the fiscal year 2008 budget. Additionally, as a companion to approving the budget plan, a five-year Capital Improvement Plan was presented to the City Council. The five-year plan links anticipated expenditures for infrastructure development with community needs and desires and provides a citywide perspective of recommended projects and proposed funding sources. The Capital Improvement Plan was finalized in June 2007, and totaled $578.9 million for the five-year fiscal period ending June 30, 2012. The five-year Capital Iniprovement Plan has been submitted and annually updated, in its present form, since 1982, for effective long-range planning purposes.
It is City Management's belief that these two plans give City Council members an expanded opportunity to set policy and provide direction for implementation, resulting in improved management efficiency and improved financial results.DEBT ADMINISTRATION:
At June 30, 2007, the City had a number of debt issues outstanding, as shown in detail in the notes to the financial statements.
The City's ratio of net bonded debt to assessed valuation and the amount of net general bonded debt per capita are useful indicators of our debt position to management, citizens, and investors.
As of June 30, 2007, the City has $5.7 million in authorized, outstanding tax-supported general obligation bonds with no authorized but unissued general obligation bonds. This level of general obligation debt was well below the legal limit of $4.0 billion, or 15% of assessed valuation.
The City's general obligation bonds are rated Aa2 by Moody's Investors Service and rated AA by Standard and Poor's Corporation.
CASH MANAGEMENT:
The City Treasurer invests temporarily idle funds in accordance with the California Government Code and a formal investment policy approved by the City Council and the Investment Advisory Commission.
During fiscal year 2007, funds were invested in such instruments as U.S. Treasury obligations, U.S.agency securities, commercial paper, corporate medium-term notes, money market mutual funds, and the Local Agency Investment Fund (State Investment Pool). The average maturity of the portfolio as of June 30, 2007 was one year and one month (400 days). Interest earnings for the fiscal year were approximately
$22.0 million with an average earned yield of 4.09%. Bond proceeds are not commingled with the portfolio but are invested pursuant to the bond indentures.
Consequently, earnings and yield on bond proceeds are not reflected in the previously stated figures.RISK MANAGEMENT Through the utilization of professional risk mafiagement techniques of risk identification, risk control, risk transfer, and risk financing, tihe City has a comprehensive risk management program designed to protect the City's assets and resources from accidental loss. In the risk financing area, the City utilizes a combination of fully funded, actuarially based, self-insurance programs, an excess risk-sharing pool, an industry-captive excess insurer, and commercial insurers.
Operational expenses and reserves are maintained in the General Benefits and Insurance Fund. The City's Risk Management Division continues to be very successful with programs that generate material cost savings while, at the same time, eliminating or transferring risk to the maximumn extent.OTHER INFORMATION THE INDEPENDENT AUDIT: The City Charter requires an annual audit of the financial statements of the City by an -independent certified public accountant.
Accordingly, this year's audit was completed by KPMG LLP. In addition to meeting the requirements set forth in the City Charter, the audit was also designed to meet the requirements of the Single Audit Act Amendments of 1996 and related OMB Circular A-133. The auditors' report on the basic financial statements is included in the financial section of this report. The auditors' reports related specifically to the single audit are presented as a separate document.GOVERNMENT FINANCE OFFICERS ASSOCIATION OF THE UNITED STATES AND CANADA (GFOA) CERTIFICATE OF ACHIEVEMENT AIVARD: The GFOA awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Anaheim, California, for its comprehensive annual financial report for the fiscal year ended June 30, 2006. This was the 31st consecutive year that the City has achieved this prestigious award (fiscal years ended June 30, 1976 through 2006). In order to be awarded a Certificate of Achievement, a government must publish an easily readable 3 CITY OF ANAHEIM and efficiently organized comprehensive annual financial report. This report must satisfy both U.S. generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe our current comprehensive annual financial report continues to conform to the Certificate of Achievement Program's requirements and we are submitting it to GFOA to determine its eligibility for another certificate.
ACKNOWLEDGMENTS The preparation of this report on a timely basis could not have been accomplished by the Finance Director alone without the efficient and dedicated service of the entire staff of accountants in the Finance Department led by Deborah Moreno, Assistant Finance Director.
Appreciation is also expressed to Mayor Pro Tern Bob Hernandez, Council Member Harry Sidhu, and Assistant City Manager Tom Wood for their significant contributions as members of the Audit Cormnittee.
In closing, without the leadership and support of the City Council, preparation and results of this report would not have been possible.
Its leadership has made possible the implementation of these important and innovative concepts in fiscalmanagement by the City.Respectfully submitted, David M. Morgan City Manager William G. Sweeney Finance Director 4 CITY OF ANAHEIM Certificate of Achievement for Excellence inFinancial Reporting Presented to City of Anaheim California For its Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2006 A Certificate of Achievement for Excellence in Financial Reporting is presented by (he Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting.
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Anaheim, California for its Comprehensive Annual Financial Report for the fiscal year ended June 30, 2006. The Certificate of Achievement is a prestigious national award recognizing conformance with the highest standards for preparation of state and local government financial reports.In order to be awarded a Certificate of Achievement, a governmental unit must publish an easily readable and efficiently organized Comprehensive Annual Financial Report, whose contents conform to program standards.
Such reports must satisfy both generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe our current report continues to conform to Certificate of Achievement program requirements, and we are submitting it to GFOA.Executive Director 5 I " ,/ 44 :... " i ] ,i:::K: V 7~iiI ,i i~i)B :+ ..............
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CITY OF ANAHEIM Administrative Personnel City Manager Assistant City Manager Deputy City Manager Chief of Police City Attorney City Clerk City Treasurer Community Development Executive Director Community Services Director Convention, Sports & Entertainment Executive Director Finance Director Fire Chief Human Resources Director Planning Director Public Utilities General Manager Public Works Director David M. Morgan Thomas J. Wood Joel H. Fick John Welter Jack L. White Linda Nguyen Henry W. Stern Elisa Stipkovich Terry D. Lowe Greg Smith William G. Sweeney Roger Smith Kristine Ridge Sheri Vander Dussen Marcie L. Edwards Natalie Meeks 8
M " RP KPMG LLP Suite 700 600 Anton Boulevard Costa Mesa, CA 92626-7651 Independent Auditors' Report The Honorable Mayor and City Council of the City of Anaheim, CA: We have audited the basic financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Anaheim, California (City) as of and for the year ended June 30, 2007, which collectively comprise the City's basic financial statements as listed in tie table of contents.
These financial statements are the responsibility of tile City's management.
Our responsibility is to express opinions of these financial statements based on our audit.We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Controller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.
An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not -for the purpose of expressing an opinion on the effectiveness of tile City's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also Includes examining, on a test basis, evidence supporting the amounts and disclosures' in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinions.In our opinion, the financial statements referred to above present' fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of. the City of Anaheim, California, as of June 30, 2007, and the respective changes in the financial position, and where applicable, cash flows, thereof and the respective budgetary comparison for the General and Housing Authority Funds for the year then ended in conformity with U.S. generally accepted.accounting principles.
In accordance with Government Auditing Standards, we have also issued a report dated December 3, 2007 on our consideration of the City's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of Internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance.
That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit.Management's Discussion and Analysis on pages 11 through 19 and the pension plan supplementary information on page 66 are not a required part of the basic financial statements but are supplementary information required by the U.S.generally accepted accounting principles.
We have applied certain limited procedures, which consisted principally of inquiring of management regarding the methods of measurement and presentation of the required supplementary information.
However, we did not audit the information and express no opinion on it.Our audit was conducted for the purpose of forming opinions on the financial
-statements that collectively comprise the City's basic financial statements.
The combining individual fund statements and schedules as listed in the table of contents are presented for the purposes of additional analysis and are not a required part of the basic financial statements.
The combining individual fund statements and schedules have been subjected to the auditing procedures applied in the audit of the basic financial statements and in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. The introductory section and statistical seition have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we express no opinion on them.December 3, 2007 KPMG LIP. U.IS. limited liabii~ty panUnorship, the U.S. --ba film of KPMVG Ino,~,O. 0Swisocop.
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CITY OF ANAHEIM Management's Discussion and Analysis (Unaudited)
As management of the City of Anaheim (City), we offer readers of the City's basic financial statements this narrative overview and analysis of the financial activities of the City as of and for the fiscal year ended June 30, 2007. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal, which can be found in the introductory section of this report and the City's basic financial statements in the financial section of this report. All amounts, unless otherwise indicated, are expressed in thousands of dollars.OVERVIEW OF THE BASIC FINANCIAL STATEMENTS This discussion and analysis are intended to serve as an introduction to the City's basic financial statements.
The City's basic financial statements are comprised of three components:
- 1) governmrent-wide financial statements, 2) fund financial statements, and 3) notes to financial statements.
This report also contains other supplementary information in addition to the basic financial statements themselves.
COMPONENTS OF THE ANNUAL FINANCIAL REPORT cash flows. Thus, assets, liabilities, revenues and expenses are reported in these statements f6r some items that will only result in cash flows in future fiscal periods (e.g. uncollected revenues and accrued but unpaid interest expense).The Statement of Net Assets presents information on all of the City's assets and liabilities, including capital assets and long-term liabilities, with the difference between the two reported as net assets. Over time, increases or decrease§ in net assets may serve as a useful indicator of whether the financial position of the City as a whole is improving or deteriorating.
The Statement of Activities presents information showing how the City's net assets changed during the most recent fiscal year. Functional activities are highlighted in this statement, whereby direct and indirect functional costs are shown net of related program revenue. This statement shows the extent to which the various functions depend on general taxes and non-program revenues for support.The government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities).
The governmental activities of the City include general government, police, fire, community development, planning, public works, community services, public utilities (street lighting), convention, sports and entertainment (Visitor and Convention Bureau and the Honda Center), and interest on related long-term debt. The business-type activities of the City include an electric and water utility, sanitation, golf courses, and convention, sports and entertainment venues (Anaheim Convention Center, Angel Stadium of Anaheim, and The Grove of Anaheim)operations.
The government-wide financial statements include not only the City itself, but also the Anaheim Housing Authority.
Anaheim Redevelopment Agency, Community Center Authority, Anaheim Public Improvement Corporation, and Anaheim Public Financing Authority.
Although these entities are legally separate, they function for all practical purposes as a part of the City, and therefore have been included as blended component units as an integral part of the primary government.
The government-wide financial statements can be found on pages 21-23 of this report.Fund financial statements.
The fund financial statements focus on current available resources and are organized and operated on the basis of funds, each of which is defined as a fiscal and accounting entity with a self-balancing set of accotmts, established for the purpose of carrying on specific activities or attaining certain objectives in accordance with special regulations, restrictions or limitations.
All of the funds of the City can be divided into three categories:
governmental funds, proprietary funds, and fiduciary funds.IMa nage ts I nancial Discussion and Statesi i Analysis bummiary -r uetaii Government-wide financial statements.
The government-wide financial statements are comprised of the Statement of Net Assets and the Statement of Activities.
These two statements are designed to provide readers with a broad overview of the City's finances utilizing the full accrual method of accounting, in a manner similar to a private-sector business.
Under the full accrual method of accounting, transactions are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related II CITY OF ANAHEIM Governmental funds. Governmnental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements.
However, unlike the government-wide financial statements, the governmental funds financial statements utilize the modified accrual basis of accounting, which focuses on near-term inflow and outflow of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financial requirements.
Because the focus of the governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for the governmental funds with similar information presented for governmental activities in the government-wide financial statements.
By doing so, readers may better understand the long-term impact of the government's near-term financing decisions.
Both the governmental funds Balance Sheet and the governmental funds Statement of Revenues, Expenditures and Changes in Fund Balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.
The City maintains 17 individual goverrunental funds. Information is presented separately in the governmental funds Balance Sheet and in the govermnental funds Statement of Revenues, Expenditures and Changes in Fund Balances for the General Fund and Housing Authority Special Revenue Fund, both of which are considered to be major funds. Data for the other 15 governmental funds are combined into a single, aggregated presentation.
Individual fund data for each of these nonmajor governmental funds is provided in the form of supplementary combining statements on pages 62-72, 78-79, and 82-83 of this report.The City adopts an annually appropriated budget for all governmental and proprietary funds. Budgetary comparison statements for the General Fund and the major special revenue fund (Housing Authority) are required to be presented and are inclided in the basic financial statements on pages 29-30 of this report. , Additionally, budgetary:
schedules for the other governmental funds have been provided to demonstrate compliance with the budget and can be found as part of other supplementary schedules on pages 73-77, 80-81, and 84 of this report.The governmental funds financial statements-can be found on pages 25-28 of this report.Proprietary funds. The City maintains two different types of proprietary funds.Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements.
The City uses its enterprise funds to account for its electric and water utility, sanitation, golf courses, and convention, sports and entertainment venues operations.
Internal service funds are an accounting device used to accumulate and allocate costs internally among the City's various functions.
The City uses internal service funds to account for its general benefits and insurance, motorized equipment, duplicating and printing, information services, and municipal facilities maintenance.
Because these services predominantly benefit governmental rather than business-type ftmctions, they have been included with governmental'activities in the government-wide financial statements.
Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary funds financial statements provide separate information for all of the enterprise funds, which are considered to be major funds of the City. Conversely, all of the internal service funds are combined into a single, aggregated presentation in the proprietary funds financial statements.
Individual fund data for the internal service funds is provided in the form of combining statements elsewhere in this report.The proprietary funds financial statements can be found on pages 31-35 of this report.Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties outside the government.
Fiduciary funds are not reflected in the govermnent-wide financial statements because the resources of thosefunds are not available to support the City's own programs.The fiduciary fund financial statements can be found on page 36 of this report.Notes to the financial statements.
'[lie notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements.
The notes to the financial statements caii be found on pages 37-65 of this report.Other supplementary information.
In addition to the basic financial statements and accompanying notes, this report also presents combining individual find statements referred to earlier in conlection with nonmajor goverunental funds and internal service funds. Also included are the budgetary comparison Schedules of Revenues, Expenditures and Changes in Fund Balances for all nonmajor special revenue funds, all debt service funds, and all capital projects funds. These statements and schedules can be found on pages 67-89 of this report.FINANCIAL HIGHLIGHTS (Amounts in thousands)
The City's net assets increased as a result of this year's operations.
Net assets of the City's governmental activities decreased
$2,527 (less than 1%) and business-type activities net assets increased
$37,196 (4%).At the close of the current fiscal year, the City's governmental funds reported total ending fund balances of $206,533, a decrease of $10,216 (5%). 28%X, of ending fund 12 CITY OF ANAHEIM balances, $57,574, is available for spending at tile City's discretion (unreserved fund The City's total capital assets increased by $149,478 (6%) during the current fiscal balance).
year.At the end of the current fiscal year, unreserved undesignated fund balance for the The City's total long-term liabilities increased by $185,273 (11%) during the current General Fund was $44,722, or 19% of the total General Fund expenditures.
fiscal year.GOVERNMENT-WIDE FINANCIAL ANALYSIS NET ASSETS JUNE 30, 2007 AND 2006 Governmental Activities 2007 2006 Business-type Activities 2007 2006 Total Government 2007 2006 Current and other assets Capital assets Total assets Other liabilities Long-term liabilities outstanding Total liabilities Net assets: Invested in capital assets, net of related debt Restricted Unrestricted (deficit)Total net assets$ 485,098 1,233,214 1,718,312 82,923 931,213 1,014,136 667,414 69,949 (33,187)$ 704,176$ 470,713 1.231,832 1.702,545 80,914 914,928 995,842-668,628 99,443 (61,368)$ 706,703$ 695,334 1,320,144 2,015,478 145,427 920,393 1,065,820 707,119 38,572 203,967$ 949,658$ 595,363 1,172,048 1,767,411 103,544 751,405 854,949 660,769 36,008 215,685 S 912,462$1,180.432 2,553,358 3,733,790 228,35)1,851,606 2,079,956 1,374.533 108,521 170,780$1,653,834
$1,066.076 2,403,880 3,469.956 184,458 1,666.333 1,850,791 1,329,397 135,451 154,317$1,619,165 By far the largest portion of the City's net assets (83%) reflects its investment in capital assets (e.g. land, buildings, utility plant, machinery, equipment, and infrastructure), net of any related outstanding debt, used to acquire those assets. The City uses these assets to provide services to citizens; consequently, these assets are not available fir future spending.
Although the City's investment in capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.
An additional portion of the City's net assets (7%) represents resources that are subject to external restriction on how they may be used. The remaining unrestricted net assets of$170,780 may be used to meet the City's ongoing obligations to citizens and creditors.
Of the unrestricted net assets, $203,967 is attributable to business-type activities, which offsets the governmental activities unrestricted net deficit of $33,187. The Anaheim Redevelopment Agency (Redevelopment Agency), a blended component unit of tile City, represents
$128,699 of the deficit in unrestricted net assets. The Redevelopment Agency was established for the purpose of promoting economic revitalization and eliminating blight within the designated project area of the City. Often these activities do not result in residual assets, but rather underwrite the cost of a development activity deemed beneficial in meeting the Redevelopment Agencys objectives.
The resulting Statement of Net Assets reflects the debt obligation to be repaid through future tax revenues, without an offsetting asset. While this is a routine function of such an entity, when blended with the City, its deficit of unrestricted net assets causes the governmental activities to report a consolidated deficit position.13 CITY OF ANAHEIM CHANGE IN NET ASSETS YEARS ENDED JUNE 30, 2007AND 2006 Governmental Business-type Total Activities Activities Government 2007 2006 2007 2006 2007 2006 REVENUES Program revenues: Charges for services $ 62,865 $ 62,031 $451,219 $452,261 $ 514,084 $ 514,292 Operating grants and contributions 97,633 87,024 1,160 2,556 98.793 89,580 Capital grants and contributions 30,123 29,004 4,808 5,749 34,931 34,753 General revenues: Taxes: Property taxes 98,647 90,299 98,647 9(0,299 Sales and use taxes 65,944 68,024 65,944 68,024 Transient occupancy taxes 83,914 75,979 83,914 75,979 Motor vehicle license fees 1,866 2,595 1,866 2,595 Other taxes 10,337 10,817 10,337 10,817 Unrestricted investment earnings 17,597 12,346 27,375 16,850 44,972 29,196 Other 1,701 5,078 1,701 5,078 Total revenues 470,627 443,197 484,562 477,416 955,189 920,613 EXPENSES Program activities:
Governmental activities:
General government 10,951 7,394 10,951 7,394 Police 115,714 98,484 115,714 98,484 Fire 50,727 50,957 50,727 50,957 Community Development 93,089 87,814 93,089 87,814 Planning 16,107 14,493 16,107 14,493 Public Works 44,473 42,029 44,473 42,029 Community Services 36,827 31,712 36,827 31,712 Public Utilities 1,800 1,704 1,800 1,704 Convention, Sports and Entertainment 10,539 8,652 10,539 8,652 Interest on long-term debt 50,053 46,431) 50,053 46,430 Business-type activities:
Electric Utility, 338,514 365,277 338,514 365,277 Water Utility 51,672 47,225 51,672 47,225 Sanitation 48,946 47,163 48,946 47,163 Golf Courses .4,365 4,433 4,365 4,433 Convention, Sports and Entertainment Venues 46,743 47,965 46,743 47,965 Total expenses 430,280 389,669 490,240 512,1)63 920,520 901,732 Excess (deficiency) before transfers 40,347 53,528 (5,678) (34,647) 34,669 18,881 Transfers in (out) (42,874) 8,444 42,874 (8,444)Increase (decrease) in net assets. (2,527) 61,972 37,196 (43,091) 34,669 18,881 Net assets at beginning of year 706,703 644,731 912,462 955,553 1,619,165 1,600,284 Net assets at end of year $704,176 $706,703 $949,658 $912,462 $1,653,834
$1,619,165 14 CITY OF ANAHEIM REVENUES BY SOURCE -GOVERNMENTAL ACTIVITIES Oiher axes 2% OtUnre stricted investtntt eanrnngs Ott<1%Motor vehicle license fees<1%Trasient ccupancy taxes 18%Sales and use taxes 14%\Charges for serites 21%Operarting gearnt and Capital gaanrs ad contiburions 7%Property a-es 21%Governmental activities.
The most significant revenues of the governmental activities are general taxes (55%), which include property taxes (21%), sales and use taxes (14%), transient occupancy taxes (18%), other taxes (2%), and motor vehicle license fees (VLF)(less than 1%). Program revenues are 41% of the total revenues of the governmental activities, which include charges for services (13%), operating grants and contributions (21%), and capital grants and contributions (7%).Public safety (police and fire) expenses are the most significant (39%) of all governmental activities expenses, followed by community development (22%), interest on long-term debt (12%), public works (10%), and various other programs (17%). Included in these amounts is depreciation expense, which is 7% of the total expenses for governmental activities.
Governmental activities revenues increased
$27,430 (6%) in the current fiscal year.Operating grants increased
$12,149 (14%) and capital grants increased
$1,119 (4%)primarily due to an increase in Urban Area Security Initiative (UASI) grant revenues.
The overall strength in the economy, increased property assessments, and Disneyland's 50th anniversary celebration contributed to the increases in property taxes of $8,348 (9%) and transient occupancy taxes (TOT) of $7,935 (10%).Governmental activities expenses increased
$40,611 (10%) in the current fiscal year. The most significant change in governmental expenses was due to the increased police expenses of $17,230 (10%). Of this, over 40% of the increase related to expenses for the UASI grant. In addition, police expenses increased due to the implementation of the Anaheim Family Justice Center, which provides a "one-stop" community center, capable of serving the victims of domestic violence, child abuse, elder abuse and sexual assault.Five sworn positions and additional training were also added to police. Community development expenses increased
$5,275 (6%), primarily due to the increase in U.S.Department of Housing and Urban Development (HUD) Section Eight Program for rental assistance.
Community services expenses increased
$5,115 (16%), primarily due to the operational requirements of new or expanded facilities, including the Haskett Library expansion, Central Library renovation, the new East Hills Library, West Anaheim Youth Center, and East Anaheim Gym.There were no other programs with significant or unusual changes.EXPENSES AND PROGRAM REVENUES -GOVERNMENTAL ACTIVITIES S120.000 S100,000$80.000$60.000$40,000$20.000 4'I'4 I 0 ~0 .~ 0 /0 / ~, ~ '40. 400 4 ~ I 1<.4' ~0 Cl f/* Expenses -I Progran revenues 15 CITY OF ANAHEIM REVENUES BY SOURCE -BUSINESS-TYPE ACTIVITIES Operating grants and contributions
<1%Capital g contribut rants and innts, I %_Unrestricted investrent earnings, 6%Business-type activities.
Business-type activities increased the City's net assets by$37,196. Key elements of this change are as follows: Charges for services of $451,219 decreased
$1,042 (less than 1%). The decrease in charges for services from the Electric Utility of $12,771 (4%) was primarily due to a decrease in wholesales energy revenues resulting from a decrease in supply and lower prices. This decrease was offset by increases in all other business-type activities, most notably the increase of $4,951 (18%) from Convention, Sports, and Entertainment Venues due to greater use of the facilities and services.Operating grants and contributions of $1,160 decreased
$1,396 (55%). This decrease was primarily due to the Sanitation decrease of $1,J60 (93%) primarily due to grant revenues in the prior year that did not recur.Total expenses of $490,240 decreased
$21,559 (4%). The most significant change in program expenses is the decrease in the Electric Utility of $26,763 (7%). This is primarily due to a $4,542 decrease in purchased power costs and a decrease in depreciation expense of $21,462 for the San Onofre Nuclear Generating Station units 2 and 3 (SONGS) due to the sale of the City's ownership interest on December 29, 2006 (see note I for further discussion).
I Chaiges far servises 93%EXPENSES AND PROGRAM REVENUES -.BUSINESS-TYPE ACTIVITIES
$350.000-$315,000$280.000$245,000$210.000$175.000$140.0001$105,000$70,000$35,000$-Electric Utility Water Utility Sanitatirn Golf Courses Conenttion, Spocrts alstd Enrttainmtt Venues ri Program revenues U Expenses 16 CITY OF ANAIHEIM FINANCIAL ANALYSIS OF THE CITY'S FUNDS Governmental funds. The focus of the City's governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources.
Such information is useful in assessing the City's financing requirements.
In particular, unreserved fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year.As of the end of the current fiscal year, the City's governmental funds reported total ending fund balances of $206,533, a decrease of $10,216 in comparison with the prior fiscal year.28% of the ending fund balances, $55,298, constituted unreserved fund balances, which are considered available for appropriation.
The remainder of the fund balances is reserved to indicate that it is not available for new spending because it has already been committed 1) to pay debt service ($44,594), 2) related to land held for resale by the Redevelopment Agency ($64,074), and 3) to offset non-current financial resources that are not anticipated to be liquidated in the near term (S40,291).
General Fund revenues were $19,017 (8%) greater than in the prior fiscal year primarily due to-the increases in property taxes and transient occupancy taxes as discussed in the government-wide financial analysis of governmental activities.
General Fund expenditures increased
$18,557 (9%) in the current fiscal year. The most significant change in General Fund expenditures was due to the increase in the Police Department of $5,364 (6%), primarily from the Anaheim Family Justice Center, additional personnel, and training.
In addition, Community Services expenditures increased
$3,469 (13%), primarily due to the operational requirements of new or expanded facilities.
Capital outlay increased
$1,437 (266%), primarily due to the acquisition of a historic home for preservation, corridor beautification, and computer automation for the Central Library renovation.
Debt service increased
$1,653 (194%), primarily due to payments for the Police Department's Computer-Aided Dispatch and Records Management System (CAD/RMS) loan that were paid by nomnajor governmental funds in prior years.The Housing Authority Fund revenues decreased by $766 (1%). Expenditures decreased by $4,498 (6%). This decrease in expenditures resulted from a $9,669 reduction in capital outlay due to the prior year aquisition of affordable housing land and improvements, and was partially offset by an increase of approximately
$4,200 in the HUD Section 8 rental assistance program.Proprietary funds. The City's proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail.The Electric Utility's fund net assets decreased
$20,441 (6%) in the current fiscal year.The most significant factors of the change in fund net assets are discussed in the government-wide financial analysis of business-type activities.
The Water Utility's fund net assets increased
$193 (less than 1%) in the current fiscal year.There were no significant or unusual changes.Sanitation's fund net assets increased
$55,697 (172%) in the current fiscal year. The change primarily resulted from transfer of $51,425 in sewer related capital assets from governmental activities.
The Golf Courses' fund net assets decreased
$301 (4%) in the fiscal current year. There were no significant or unusual changes.The Convention, Sports and Entertaimnent Venues fund net assets increased
$4,578 (1%)in the current fiscal year. The most significant factors of tile change in fund net assets are discussed in the govermnent-wide financial analysis of business-type activities.
GENERAL FUND BUDGETARY HIGHLIGHTS During the year the original budget was amended to increase appropriations by $9,454 (3%). Following are the main components of the increase:* $3,362 for carryovers of prior year expenditures.
- $1,960 for additional Public Works expenditures.
$1,000 for the final phase of the State College Boulevard Master Plan improvements;
$350 for costs related to the Circle Haven and Ramsgate landslides.
- $2,557 for additional Community Services expenditures.
$750 for acquisition and structural improvement costs for preservation of a historic home and $1,291 for costs associated with the new Muzeo.* $787 for additional Fire expenditures.
$625 for overtime costs related to Master Mutual Aid and Federal Disaster Responses.
17 CITY OF ANAHEIM The increases in appropriations were to be funded primarily from fund balance. General Fund expenditures were less than budgeted.
Of the total appropriations of$242,518, approximately 3%, or $8,432, went unspent. There were no significant General Fund revenues of $262,785 exceeded budgeted revenues of $254,269 by $8,516 variances.
(3%). The excess was primarily due to property taxes ($2,950) and transient occupancy taxes ($4,103) due to the overall strength in the economy.CAPITAL ASSETS AND DEBT ADMINISTRATION CAPITAL ASSETS (net of accumulated depreciation)
JUNE 30, 2007 AND 2006 Governmental Activities 2007 2006$ 548,260 $ 521,904 42,025 46,982 Land Construction in progress Nuclear fuel at amortized cost Buildings, structures and improvements Utility plant Machinery and equipment tnfrastructure Total Business-type Activities 2007 2006 S 56,487 S 37,593 145,715 76,745 2,792 391,780 342,903 715,106 699,513 11,056 12,502$1,320,144
$1,172,048 170,341 52,699 419,889$1,233,214 148,510 41,539 472,897$1,231,832 Total Government 2007 2006$ 604.747 187,740 562,121 715,106 63,755 419,889$2,553,358
$ 559,497 123,727 2,792 491,413 699,513 54,041 472,897$2,403,880 Capital assets. The City's investment in capital assets for its governmental and business-type activities at June 30, 2007,, amounted to $2,553,358 (net of accumulated depreciation).
This investment in capital assets included land, construction in progress, buildings, structures and improvements, utility plant, machinery and equipment, and infrastructure.
The total increase in the City's investment in capital assets resulted from many various projects throughout the City. The total increase over the prior fiscal year was 6%, of Which governmental activities increased less than 1% and business-type activities increased 13%. The increase in business-type activities is primarily due to construction in progress for the electric substations and distribution system.Additional information on the City's capital assets can be found in note 5 of the notes to the financial statements, on pages 48-49 of this report.18 CITY OF ANAHEIM LONG-TERM LIABILITIES JUNE 30, 2007 AND 2006 Governmental Activities 2007 2006 Business-type Activities 2007 2006 Total Goverlnsent 2007 2006 General obligation bonds Revenue bonds TFax allocation bonds Certificates of participation Capital lease obligations Notes and loans payable Self-insurance Retired medical Decommissioning provision Total$ 5,700 582,272 152,135 26,788 2,484 57,614 30,897 73,323$931,213$ 6,170 575,125 159,664 30,066 2,220 43,331 30,828 67,524$914,928$706.126 96,475 267 14,081 103,444$920393$513,874 125,088 274 14,976 97,193$751,405$ 5,70(1 1,288,398 152,135 123,263 2,751 71,695 30,897 73,323 103,444$1,851,606
$ 6,17(0 1,088,999 159,664 155,154 2,494 58.307 30,828 67,524 97,193$1,666,333 Long-terin liabilities.
The City's outstanding long-tenn liabilities, including bonds, certificates of participation, capital leases, notes and loans payable, self-insurance, retired medical, and the provision for decommissioning costs totaled $1,851,758 at June 30, 2007.Of this total, $931,213 (50%) was in governmental activities and $920,393 (50%) was in business-type activities.
The City's outstanding long-term liabilities increased
$185,273 (11%) in fiscal year 2007. The increase is primarily due to the issuance of new revenue bonds by the Electric Utility ($206,035) and Sanitation
($47,710), which was partially offset by the refunding of $21,110 of Electric Utility certificates of participation and$49,625 of Electric Utility revenue bonds.Additional intformation on the City's long-term liabilities ban be found in note 8 of the notes to the financial statements, on pages 50-58 of this report.ECONOMIC FACTORS AND NEXT YEAR'S BUDGET AND RATES The unemployment rate in the Orange County, California area for June 2007 was 3.9%, which remains below both the state (5.2%) and national (4.5%) average.For the 2008 fiscal year, the City appropriated
$267,057 in estimated available resources of $298,45(0 for General Fund for spending.
This leaves approximately
$31,393 in estimated available reserves, which is 12% of General Fund appropriations.
The City's long-standing policy is to maintain General Fund reserves of at least 7% to 10% of annual appropriations.
The City annually reviews all of its fees as part of the budget adoption process.Developer, construction, and other fees applicable to residents and developers doing business with the City were adjusted in June 2006, generally by the average of Consumer Price Index (CPI) of approximately 3%. This is consistent with the City's policy of recovering costs without becoming an undue financial burden oil existing tax and rate payers.REQUESTS FOR INFORMATION This financial report is designed to provide a general overview of the City's finances for all those with an interest in the government's finances.
Questions concerning any of the information provided in this report or requests for additional information should be addressed to the Office of the Finance Director, City of Anaheim, 200 South Anaheim Boulevard, Suite 643, Anaheim, California, 92805.19
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CITY OF ANAHEIM Statement of Net Assets June 30, 2007 (In thousands)
Governmental Business-type Activities Activities Total ASSETS Cash and cash equivalents S 84,454 $ 84,584 $ 169,038 Investments 177,146 177,229 354,375 Accounts receivable, net 11,347 50,140 61.487 Accrued interest receivable 2,726 5,708 8,434 Internal balances, net 2,029 (2,029)Due frotn other goverunents 46,807 46,807 Notes receivable, net 39,384 39,384 Inventories 847 7,133 7,980 Land held for resale, net 64,074 .64,074 Prepaid and other assets 1,687 26,472 28,159 Restricted cash and cash equivalents 24,963 17,151 42,114 Restricted investments 25,669 303.045 328,714 Unamortized debt issuance costs 3,965 8,710 12.675 Bond payment receivable 16,927 16,927 Pipeline receivable 264 264 Capital assets, net: Nondepreciable 590,285 202,202 792,487 Depreciable 642,929 1,117,942 1 760,871 Total assets 1,718,312 2,015,478 3,733,790 LIABILITIES Accounts payable 29,213 47,786 76,999 Wages payable 23,199 1,965 25,164 Due to other governments 6,041 6,041 Interest payable 10,452 9,865 20,317 Short-terns notes payable 2,759 2,759 Arbitrage rebate liability 215 215 Deposits 5,023 11,594 16,617 Regulatory credits 73,468 73,468 Unearned revenues 6,236 534 6,770 Noncurrent liabilities:
Due within one year 43,264 25,527 68,791 Due in more than one year 887,949 894,866 1,782,815 Total liabilities 1,014,136 1,065,820 2,079,956 NET ASSETS Invested in capital assets, net of related debt 667,414 707,119 1,374,533 Restricted for: Debt service 1,932 12,115 14,047 Capital projects 8,558 20,052 28,610 Community development 33,658 33,658 Streets and roads 21,068 21,068 Other purposes 4,733 6,405 11,138 Unrestricted (deficit) 33,187) 203,967 170,780 Total net assets $ 704,176 $ 949,658 $1,653,834 The accompanying notes are an integral part of these-financial statements.
21 (This page left blank intentionally) 22 CITY OF ANAHEIM Statement of Activities Year Ended June 30, 2007 (In thousands)
Program Revenues Net (Expense)
Revenue and Changes in Net Assets Indirect Expenses Expenses Allocation Operating Charges for Grants and Services Contributions Functions/Programs Governmental activities:
General government Police Fire Community Development Planning Public Works Community Services Public Utilities Convention, Sports and Entertainment Interest on long-term debt Total governmental activities Business-type activities:
Electric Utility Water Utility Sanitation Golf Courses Convention, Sports and Entertainment Venues Total business-type activities Total government
$ 23.190 113,047 50,189 92,035 15.388 43,300 35,739 1,800 10,539 50,053 435,280 336,216 50,687 48,612 4,241 45,484 485,240$920,520$(12,239)2,667 538 1,054 719 1,173 1,088 (5,000)2,298 985 334 124 1,259 5,000$$ 4,557 7,590 11,033 6,713 10,790 11,662 10,320 201)62,865 310,074 49,600 53,215" 6,022 32,308 451,219$514,084$ 304 12,292 312 69,058 1,455 12,770 1,442 97,633 50 93 1,017$98,793 Capital Grants and Contributions
$ 4,230 153 163 17,616 808 7,153 Governmental Business-type Activities Activities
$ (6,090)(91,602)(39,229)(17,155)(3,862)12,425)(24,257)(1,800)(3,186)(50,053)(239,659)$(26,472)(358)4,362 1,657 (12,242)(33,053 (239,659)
(33,053)1,918 1,714 1,176 4,808$34,931 Total$ (6,090)(91,602)(39.229)(17,155)(3,862)(2,425)(24,257)(1,800)(3.186)(50,053)(239,659)(26,472)(358)4,362 1,657 (12.242)(33,053)(272,712)98,647 65,944 83,914 1,866 10,337 44,972 1,701 307,381 34.669 1,619,165$1 ý653,834 General revenues: Taxes: Property taxes Sales and use taxes Transient occupancy taxes Motor vehicle license fees Other taxes Unrestricted investment earnings Other Transfers Total general revenues and transfers Change in net assets Net assets at beginning of year Net assets at end of year 98,647 65,944 83,914 1,866 10,337 17,597 1,701 (42,874)237.132 (2,527)706,703$ 704,176 27,375 42,874 70,249 37,196 912,462$949,658 The accompanying notes are an integral part of these financial statements.
23 j A V C" N>(This page left blank intentionally) 24 CITY OF ANAHEIM Balance Sheet Governmental Funds June 30, 2007 (In thousands)
Nonmajor Total Housing Governmental Governmental General Authority Funds Funds ASSETS Cash and cash equivalents
$10,926 $ 3,289 $ 23,173 $ 37,388 Investments 22,814 6,868 49,329 79,011 Accounts receivable, net 10,410 65 10,475 Accrued interest receivable 392 63 882 1,337 Notes receivable 654 19,838 22,355 42,847 Due from other finds 17,718 657 11,611 29,986 Due from other govermunents 15,518 284 31,005 46.807 Inventories 256 256 Land held for resale, net 64,074 64,074 Prepaid and other assets 2,024 1,323 3,347 Restricted cash and cash equivalents 5,727 19,218 24,945 Restricted investments 25,197 25,197 Total assets $80,712 $36,726 $248,232 $365,670 LIABILITIES AND FUND BALANCES Liabilities:
Accounts payable $ 7565 $ 1,267 $ 14,548 $ 23,380 Wages payable 4,870 117 406 5,393 Short-term note payable 2,759 2,759 Interest payable on short-terin note 64 64 Deposits 3,636 78 1,309 5,023 Due to other funds 79 34,964 35,043 Due to other governments 196 5,764 81 6,041 Deferred revenues 8,432 21,403 51,599 81.434 Total liabilities 24,778 28,629 105,730 159,137 Fund balances: Reserved for encumbrances 2,687 16,700 19,387 Reserved for noncurrent due from other funds 6,245 162 10,894 17,301 Reserved for inventories 256 256 Reserved for debt service 44.594 44,594 Reserved for land held for resale 64,074 64,074 Reserved for prepaid and other assets 2,024 1,323 3,347 Unreserved
-designated for debt service, reported in: Debt Service Funds 2,276 2,276 Unreserved
-designated for capital projects, reported in: Special Revenue Funds 2.4315 2,415 Capital Projects Funds 35,510 35,510 Unreserved
-undesignated, reported in: General Fund 44,722 44.722 Special Revenue Funds 7,935 (8,445) (510)Capital Projects Funds (26,839) (26,839 Total fund balances 55,934 8,097 142,502 206,533 Total liabilities and fund balances $80,712 $36,726 $248,232 $365,670 The accompanying notes are an integral part of these financial statements.
25 r CITY OF ANAHEIM Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Assets June 30, 2007 (In thousands)
Total fund balances -governmental funds $ 206,533 Amounts reported for governmental activities in the Statement of Net Assets are different because: Capital assets used in the operation of governmental funds are not financial resources and, therefore, are not reported in the funds. These assets consist of: Land $ 548,260 Construction in progress 42,025 Buildings, structures and improvements 254,811 Machinery and equipment 48,870 Infrastructure 672,647 Accumulated depreciation (358,796)Total capital assets, net 1,207.817 Other long-term assets are not available to pay for current-period expenditures and, therefore, are deferred in the funds. 72,586 Payment of debt issuance costs use current financial resources in the governmental funds but increase assets in the Statement of Net assets 4,017 Internal service funds are used by management to charge the costs of certain activities, such as insurance, employee benefits, and fleet services, to individual funds. The assets and liabilities of the internal service funds are included in governmental activities in the Statement of Net Assets. 49,364 Compensated absences, not otherwise included in the internal service funds, are not due and payable in the current period and, therefore, are not reported in the funds. (267)Long-term liabilities of governmental funds, including bonds, certificates of participation, and notes and loans payable ($825,526), and accrued interest payable ($10,348), are not due and payable in the current period and, therefore, are not reported in the funds. (835,874)Net assets of governmental activities
$ 704,176 The accompanying notes are an integral part of these financial statements.
26 CITY OF ANAHEIM Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds Year Ended June 30, 2007 (In thousands)
Nonmajor Total Housing Governmental Governmental Revenues:
General Authority Funds Funds Property taxes $ 57,268 $ 45,218 $ 102!486 Sales and use taxes 66,761 66,761 Transient occupancy taxes 83,914 83,914 Other taxes 7,531 7.531 Licenses, fees and permits 23,229 S 93 14,669 37,991 Intergovernmental revenues 3,750 62,048 45,729 111,527 Charges for services 12,469 357 134 12,960 Fines, forfeits and penalties 3,689 3,689 Use of money and property 3,777 4,704 9,727 18,208 Other 397 539 6,665 7,601 Total revenues 262,785 67,741 122,142 452,668 Expenditures:
Current: City Council 275 275 City Administration 2,890 2,890 City Attorney 4,519 119 4,638 City Clerk 1,045 1,045 Human Resources 1,081 1,081 Finance 4,868 19 4,887 City Treasurer 538 538 Police 97,693 11,774 109,467 Fire 47,860 341 48,201 Conmmunity Development 1017 65,188 28,584 94.789 Planning 13.468 1,294 14,762 Public Works 17,375 9,445 26,820 Conmmunity Services 30.619 2,169 32,788 Public Utilities 1,791 1,791 Convention, Sports and Entertainment 6,118 1,281 7,399 Capital outlay 1,978 29 74,154 76,161 Debt service: Principal retirement 2,273 24 15,768 18,065 Interest and fiscal agent charges 230 2 40,955 41,187 Debt issuance costs 4,017 4,017 Total expenditures 235,638 65,243 189,920 490,801 Excess (deficiency) of revenues over (under) expenditures 27,147 2.498 (67,778) (38,133)Other financing sources (uses): Transfers in 30,506 3,664 67,079 101,249 Transfers out (57,950) (2,237) (30,841) (91,028)Issuance of refunding bonds 256,320 256,320 Discount on refunding bonds (3,186) (3,186)Payment to refunded bond escrow agent (255,325)
(255,325)Issuance of notes payable 238 18,000 18,238 Capital leases 1,552 2 95 1,649 Total other financing sources (uses) (25.892 1,667 52,142 27,917 Net change in fund balances 1.255 4,165 (15,636) (10,216)Fund balances at beginning of year 54.679 3,932 158,138 216,749 Fund balances at end of year $ 55,934 $ 8,097 $ 142,502 $ 206.533 The accompanying notes are an integral part of these financial statements.
27 CITY OF ANAHEIM Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities Year Ended June 30, 2007 (In thousands)
Net change in fund balances -total governmental funds $ (10,216)Amounts reported for governmental activities in the Statement of Activities are different because: Governmental funds reportecapital outlays as expenditures.
However, in the Statement of Activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense.This is the amount by which capital outlays ($76,161) exceeded depreciation
($25,896) in the current period. 50,265 Transfers of capital assets between governmental funds and proprietary funds do not require the use of current financial resources and are not reported as transfers in the funds. (53,395)The net effect of other miscellaneous transactions involving capital assets (i.e., sales, trade-ins, and donations) is to increase net assets. 5,616 Revenues in the Statement of Activities do not provide current financial resources and are not reported as revenues in the governmental funds. 2,663 Proceeds from long-term debt ($268,296), net of debt issuance costs of ($4,017) provide current financial resources to governmental funds, but the issuing of debt increases long-tenn liabilities in the Statement of Net Assets. (264,279)Repayment of principal on long-term debt is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the Statement of Net Assets. 270,104 Certain expenses reported in the Statement of Activities that do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. (3,665)Internal service funds are used by management to charge the costs of certain activities, such as insurance, employee benefits, fleet services, to individual funds. The net revenue of the internal service funds is reported with goverunental activities.
380 Change in net assets of governmental activities
$ (2,527)The accompanying notes are an integral part of these financial statements.
28 CITY OF ANAHEIM Statement of Revenues, Expenditures and Changes in Fund Balances Budget and Budgetary Basis Actual -General Fund Year Ended June 30, 2007 (In thousands)
Original Final Budgeted Budgeted Actual Variance with Amounts Amounts Amounts Final Budget Revenues: Property taxes $ 54,093 $ 54,318 S 57,268 $ 2,950 Sales and use taxes 68,778 68,778 66,761 (2,017)Transient occupancy taxes 79,811 79,811 83,914 4,103 Other taxes 8,065 8,065 7,531 (534)Licenses, fees and permits 20,455 20,757 23,229 2,472 Intergovernmental revenues / 3,830 3,861 3,750 (j111)Charges for services 12,520 12,510 12,469 (41)Fines, forfeits and penalties 3.188 3,188 3,689 501 Use of toney and property 2,325 2,131 3,777 1,646 Other 850 850 397 (453)Total revenues 253,915 254,269 262,785 8,516 Expenditures:
City Council 286 286 275 (11)City Administration 3,371 3,430 2,899 (531)City Attorney 4,733 4,733 4,551 (182)City Clerk 983 1,061 1,040 (21)I-luman Resources 1,046 1,095 1,090 (5)Finance 4,812 5,050 4,878 (172)City Treasurer 643 645 538 (107)Police 98,982 99,224 98,795 (429)Fire 47,324 49,864 47.932 (1,932)Community Development 1,301 1,301 1,017 (284)Planning 13,808 14,153 13,614 (539)Public Works 16,552 18,779 17,835 (944)Conmmunity Services 31,828 34,979 31,713 (3,266)Public Utilities 1,733 1,796 1,791 (5)Convention, Sports and Entertainment 5,662 6,122 6.118 (4)Total expenditures 233,064 242,518 234,086 -(8,432)Excess of revenues over expenditures 20,851 11,751 28,699 16,948 Other financing sources (uses): Transfers in 32,70(0 32,700 30,506 (2,194)Transfers out (57,046) (57,046) (57,950) (904)Proceeds from the sale of capital assets 2(0 20 (20)Total other financing uses (24,326 (24,326) (27,444) (3,118)Net change in fund balance (3,475) (12,575) 1,255 13,830 Fund balance at beginning of year 54,679 54,679 54,679 Fund balance at end of year $ 51,204 $ 42.104 S 55,934 $13,831)The accompanying notes are an integral part of these financial statements.
29 CITY OF ANAHEIM Statement of Revenues, Expenditures and Changes in Fund Balances Budget and Budgetary Basis Actual -Housing Authority Year Ended June 30, 2007 (In thousands)
Original Final Budgeted Budgeted Actual Variance with Amounts Amounts Amounts Final Budget Revenues: Licenses, fees and permits $ 70 S 70 $ 93 $ 23 Intergovernmental revenues 60,849 63,961 62,048 (1,913)Charges for services 386 386 357 (29)Use of money and property 463 463 4,704 4,241 Other 583 583 539 (44)Total revenues 62,351 65,463 67,741 2,278 Expenditures:
Community Development 66,360 69,108 65,241 (3,867)Total expenditures 66,360 69,108 -65,241 -(3,867)Excess (deficiency) of revenues over (under) expenditures (4,009) (3,645) 2,500 6,145 Other financing sources (uses): Transfers in 1,023 1,023 3,664 2,641 Transfers out (1,668) (5,168) (2,237) 2,931 Issuance of long-term debt 1,400 1,400 238 (1,162)Proceeds from the sale of capital assets 2,660 2,660 _____(2,660)
Total other financing sources (uses) 3,415 (85) 1,665 1,750 Net change in fund balances (594) (3,730) 4,165 7,895 Fund balance at beginning of year 3,932 3,932 3,932 ___Fund balance at end of year $ 3,338 S 202 $ 8,097 $ 7,895'[le acconipanying notes are an integral part of these financial statements.
3 30 CITY OF ANAHEIM Statement of Fund Net Assets Proprietary Funds June 30, 2007 (in thousands)
Business-type Activities
-Enterprise Funds ASSETS Current assets: Cash and cash equivalents Investments Restricted cash and cash equivalents Restricted investments Accounts receivable, net Accrued interest receivable Interfund receivable Inventories Bond payment ieceivable Prepaid and other assets Total current assets Noncurrent assets: Restricted cash and cash equivalents Restricted investments Unamortized debt issuance costs Bond payment receivable, less current portion Pipeline receivable Interfund receivable, less current portion Prepaids and other assets Capital assets: Land Buildings, structures and improvements Utility plant Machinery and equipment Construction in progress Less accunulated depreciation Capital assets, net Total noncurrent assets Total assets Electric Water Utility Utility$ 55,135 $ 9,245 115,764 19,410 1,271 3,298 35,039 6,120 4,150 347 Convention, Sports and Golf Entertainment Sanitation Courses Venues Governmental Activities
-Internal Total Service Funds$ 10,600 22,137 1,538 47,412 6,865 486$ 221 $461 197 3 9,383 $ 841584 9,457 177,229 2,809 50,710 1,919 50,140-722 5,708 280 5 7,133 1,455 1,455 1 425 2,942 380,473 280 6,847 281 89,038 882 3 143 281 217,358 40,253 13,540 234,643 6,992 140 26,047 33,974 1,920 142 264 2,113 519 316 52,728 4,202 1,022 58,268 (5,275)52,993 53,512$142,550 802 15,772 1,057 15,472 10,368 738,006 298,860 135,831 907,811 (235,359)672,452 953,814 1,171,172 7,984 308,957 (86,401)222,556 224,882 265,135 (continued) 1,949 16,286 968 13 19,216 (6,870)12,346 12,346 13,228 18,135 472,580 25,662 865 517,242 (157,445)359,797 403,268 436,210 14,342 252,335 8,710 15,472 264 10,508 26,047 56,487 541,594 1,036,866 30,832 145,715 1,811,494 (491,350)1,320,144 1,647,822 2,028,295$ 47,066 98,135 872 1,389 17 591 40 148,110 18 472 7 62 6,679 58,522 65,201 (39,804)25,397 25,956 174,066 31 CITY OF ANAHEIM Statement of Fund Net Assets Proprietary Funds June 30, 2007 (In thousands) (continued)
Business-type Activities
-Enterprise Funds Electric Water Utility Utility Convention, Sports and Golf Entertainment Sanitation Courses Venues Governmental Activities
-Internal Total Service Funds LIABILITIES Current liabilities (payable liom current assets): Accounts payable Wages payable Interest payable Compensated absences Long-tenn obligations Unearned revenues Deposits Intetfund payable Regulatory credits Total current liabilities (payable from current assets)Current liabilities (payable from restricted assets): Accounts payable Wages payable Interest payable Arbitrage rebate liability Long-term obligations Total current liabilities (payable from restricted assets)Total current liabilities Noncurrent liabilities:
Interfund payable, less current portion Long-term obligations, less current portion Provision for decommissioning costs Total noncurrent liabilities Total liabilities FUND NET ASSETS Invested in capital assets, net of related debt Restricted for: Debt service Capital projects Other purposes Unrestricted (deficit)Total fund net assets$ 32,629 902 3,750 7,153$ 9,060 337 32 1,939$ 4,123 119 210$ 294 15 7 1 732 3 548 5,191 861$ 1,235 561 1,923 8,403 534 1,767 280 14,703$ 47,341 1,934 2,133 12,193 534 11,594 828 731,68 150,025$ 5,833 1,286 40 16,253 16,360 2,611)42,382 72,640 828 117,074 12,196 445 31 7,447 213 11,018 19,154 136,228 611,071 103,444 714,515 850,743 285 2 2.316 2,603 14,799 20,225 21(,225 35,024 445 31 7,732 215 13,334 21,757 5,191 861 14,703 171,782 49,231 49,231 54,422 4,842 140 110,895 4,842 111,035 5,703 125,738 163,918 202,308 51,959 12,345 276,589 4,982 791,422 103.444 899,848 1,071,630 707,119 12,115 20,052 6,405 210,974 956,665 (7,007)$949,658 42,382 89,327 89,327 131,709 24,428 17,929$ 42,357 10,690 10,685 6,405 128,731 320,429 1,425 2,226 24,152$230,111 7,141 36,169 (4,820) 26,742$ 88,128 $ 7,525 $ 310,472 Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds.Net assets of business-type activities TIle accompanying notes are an integral part of these financial statelnents.
32 CITY OF ANAHEIM Statement of Revenues, Expenses and Changes in Fund Net Assets Proprietary Funds Year Ended June 30, 2007 (In thousands)
Business-type Activities
-Enterprise Funds Electric Water Utility Utiliiy Convention, Sports and Golf Entertainment Sanitation Courses Venues Governmental Activities
-Internal Total Service Funds Operating revenues: Sales of light and power Transmission revenues Sales of water Solid waste collection fees Wastewaler fees Street cleaning fees Green fees and cart rentals Facilities rental Concession fees Other Total operating revenues Operating expenses: Cost of purchased power Fuel and generation of power Cost of purchased water Treatment and pumping of water Maintenance, operations and administration Insurance premiums and claims Compensated absences and other benefits Depreciation and amortization Total operating expenses Operating income (loss)Nonoperating income (expenses):
Intergovernmental revenues Interest income Debt service recovery Interest expense Gain (loss) from disposal of capital assets'total nonoperating income (expenses)
Income (loss) before contributions and transfers Capital contributions Transfers in Transfers out Change in fund net assets Fund net assets at beginning of year Fund net assets at end of year$278,653 28,797$ 48,062$38,485 10,113 3,159 1,458.53,215 2,624 1 310,074 49,61)0$ 5,543 259 220 6,022$ 24,678 6,477 1,153 32,308.198,957 35,154 31,229 49.927 315,267 (5,193)50 20,297 (22,188)(1,841)(7,034)2,908 (16,315)(20,441)22,922 5.605 14,676 6.954 50,157 (557)47,252 1,246 48,498 4,717 1,995 (739)93 1,869 (192)3,490 670 4,160 1,862 22 (185)(163)1,699 (2,000)(301)26,727 12,406 39,133 (6,825)3,192 1,017 (6,990)(201)(2,982)(9,8017)1,890 12,495 4,578 305,894$310.472$278.653 28,797 48,062 38,485 10.113 3,159 5,543 24,678 6,736 6,993 451,219 198,957 35,154 22,922 5,605 123,374 71,203 457,215 (5,996)143 27,375 1,017 (30,294)(201)(1,960)(7,956)58,203 12.951 (23,472)39,726 (2,530)$37,196$139,183 139,183 36,891 7,408 99,291 5,664 149,254 (10,071)7,559 (84)146 7,621 (2,450)300 (2,150)44,507$ 42.357 1,256 1,770 699 6,487 1,980 456 (2,942)193 51,425 (2,215)55,697 340,870 229,918 32,431 7,826$320,429 $230, t11 $88,128 $ 7,525 Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds.Change in net assets of business-type activities The accompanying notes are an integral part of these financial statements.
33 CITY OF ANAHEIM Statement of Cash Flows Proprietary Funds Year Ended June 30, 2007 (In thousands)
Business-type Activities
-Enterprise Funds Convention, Sports and Golf Entertainment Sanitation Courses Venues Governmsental Activities
-Internal Total Service Funds Electric Utility Cash flows from operating activities:
Receipts from customers and users Receipts from interfund services provided Payments to suppliers Payments to employees Payments for interfund services-used Payments for insurance premiums and claims Other receipts Net cash provided by operating activities Cash flows from noncapital financing activities:
Receipt of interfund balances Transfers in Transfers out Operating grant receipts Net cash provided by (used in) noncapital financing activities Cash flows from capital and related financing activities:
Proceeds from sale of capital assets Proceeds of borrowing net of premium Transfers to escrow agent Capital contributions Capital purchases Debt service recovery Principal payments on long-term debt Interest payments Payment of interfund balances for capital purposes Debt issuance costs Net cash provided by (used in) capital and related financing activities Cash flows from investing activities:
Purchase of investment securities Proceeds from sale and maturity of investment securities Interest received Collection of note receivable Net cash provided by (used in) investing activities hk&ease in cash and cash equivalents Cash and cash equivalents at beginning of the year Cash and cash equivalents at end of the year$ 338,666-695 (204,909)(32,277)(8,640)93,535 WMater Utility$ 48,950 294 (25,661)(10,557)(4,333)$ 52,204 59 (39,609)(4,632)(2,761)$ 5,712 (2,723)(500)(207)$ 30,592 (7,887)(16,066)(2,708)3,931$ 476,124 1,048 (280,789)(64,032)(18,649)1,619 115,321$138,908 (23,872)(104,456)(2,809)(7,016)2,143 2,898 1,399 220 8,693 6,660 2,502 280 (15,859) (2,566) (2,215) (2,000)50 93 331 12,495 611 12,495 (22,640)143 (9,391)6 300 (15,529) (2,566)(2,122) (2,000)12,826 209,453 (72.178)1,916 (142,797)(13,314)(25,419)(2,418)(44,757)(595,386)600,256 19,867 24,737 57,986 10,689$ 68,675 49,229 746 (7,066)(2,309)(815)(376)(9,820)(32,468)42,306 2,124 68 12,030 8,337 2,179$ 10,516 (2,261)(8)(1)(335)46,624 (161,241)119,056 1,778 (40,407)10,755 1,383$ 12,138 (78)(1)(185)(363)(627)(505)791 22 308 183 38$ 221 (7,095)2,372 (8,129)(6,824)(280)(19,956)(52,253)60,381 3,3o6 11,434 8,235 1,950$ 10,185 258,682 (72,178)2,662 (159,297)2,372 (23,761)(33,244)(1,019)(2,753)(28,536)(841,853)822,790 27,097 68 8,102 85,496 16,239$ 101,735 306 250 (3,003)(346)(95)(3,194)(136,868)169,351 7,980 410,463 40,473 6,611$ 47,084 34 (continued)
CITY OF ANAHEIM Statement of Cash Flows Proprietary Funds Year Ended June 30, 2007 (in thousands) (continued)
Business-type Activities
-Enterprise Funds Convention, Sports and Golf .Entertainment Sanitation Courses Venues Electric Water Utility Utility Reconciliation of 6perating income (loss) to net cash provided by operating activities:
Operating income (loss)Adjustments to reconcile operating income (loss)to net cash provided by operating activities:
Depreciation and amortization Amortization of nuclear fuel Increase in provision for decommissioning costs Changes in assets and liabilities:
Accounts receivable Inventories Prepaid and other assets Accounts payable Wages payable Unearned revenues Compensated absences, post retirement and self-insurance liabilities Deposits Regulatory credits Total adjustments Net cash provided by operating activities Schedule of noncash investing, capital and noncapital financing activities:
Capital contributions Capital assets financed through capital leases Transfers in (out) of capital assets Decrease in fair value of investments Reconciliation of cash and cash equivalents:-
Cash and cash equivalents Restricted cash and cash equivalents, current portion Restricted cash and cash equivalents, noncurrent portion Total cash and cash equivalents
$ (5,193) $ (557 $ 4,717 $ 1,862$ (6,825)49,927 548 6,251 (8)1,632 2,132 8,895 56 7,825 21,470 98,728$ 93,535$ 2 77 1,496 (841)6,954 (529)(69)Ill 2,526 84 18 155 9,250$ 8,693$ 967 33 (240)(128)1,246 670 12,406 506 (93) (1,107)2 115 221 59 (162)29 1 111 31 Total$ (5,996)71,203 548 6,251 (1,231)1,565 2,358 11,539 281 31 7,147 21,625 121,317$ 115,321 S 2,146 154 53,395 (1,193)$ 84,584 2,809 14,342 S 101,735 Goverulmental Activities
-Internal Service Funds ( 10.071)5,664 562 146 (1,570)(59)1,885 6,341 12,969$ 2,898 (59)1,943$ 6,660$ 4 51,425 (118)$ 10,600 1,538$ 12,138 (641))640$ 2,502$ 55,135 $ 9,245 1,271 13 540$68,675 .$10,516 S (2)S 221$ 221 10,756$ 3,931$ 1,177 40 714 (104)$ 9,383 802$ 10,185$ 47 (491)$ 47.066 18$ 47,084 The accompanying notes are an integral part of these financial statements.
35 CITY OF ANAHEIM Statement of Fiduciary Assets and Liabilities Agency Fund -Mello-Roos June 30, 2007 (In thousands)
ASSETS Restricted cash and cash equivalents
$4,277 Due from other governments 164 Total assets $4,441 LIABILITIES Due to bond holders $4,441 The accompanying notes are an integral part of these financial statements.
36 CITY OF ANAHEIM Notes to Financial Statements (Amounts in thousands)
NOTE 1 -
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES: The financial reporting entity As defined by U. S. generally accepted accounting principles (GAAP) that are established by the Governmental Accounting Standards Board (GASB), the financial reporting entity consists of the primary government, as well as its component units, which are legally separate organizations for which the elected officials of the primary government are financially accountable.
Financial accountability is-defined as appointment of a voting majority of the component unit's board, and either a) the ability to impose will by the primary goverrnunent, or b) the possibility that the component unit will provide a financial benefit to or impose a financial burden on the primary government.
The accompanying financial statements present the City of Anaheim (City), the primary government, and its component units. The financial data of the component units are included in the City's reporting entity because of the significance of their operational or financial relationships with the City.The component units described below are each legally separate from the City, but are so intertwined with the City that they are, in substance, the same as the City. They ate reported as part of and accountable to the City and blended into the government-wide and fund financial statements.
Anaheim Housing Authority (Housing Authority) is a separate entity primarily funded by the U.S. Department of Housing and Urban Development to administer funds received under the Federal Housing Assistance Payments program. City Council Members, in separate session, serve as the governing board of the Housing Authority, and all accounting and administrative functions are performed by the City. The financial activity of the Housing Authority has been blended into the City's Comprehensive Annual Financial Report (CAFR) in the government-wide governmental activities and in the find financial statements as the Housing Authority Special Revenue Fund.Anaheim Redevelopment Agency (Redevelopment Agency) is a separate government entity created to develop and execute plans for improvement, rehabilitation and redevelopment of blighted areas within the City. City Council Members, in separate session, serve as the governing board of the Redevelopment Agency, and all accounting and administrative functions are performned by the City. The financial activity of the Redevelopment Agency has been blended into the City's CAFR in the government-wide governmental activities and in the fund financial statements as the Redevelopment Housing Set-Aside Special Revenue Fund, the Redevelopment Agency Debt Service Fund, and the Redevelopment Agency Capital Projects Fund. For a copy of the Redevelopment Agency's separate financial statements, contact the Finance Director of the City.Community Center Authority tCCA), a joint powers authority, was created primarily t6 finance the initial construction of the Anaheim Convention Center. A five-member board appointed by the City Council governs the CCA. The City has entered into a noncancelable long-term lease with the CCA, which provides for lease payments in amounts sufficient to meet the annual debt service requirements on the certificates of participation issued by the CCA to finance the construction of the facility.
The lease is a financing arrangement, which transfers the ownership of the facility to the City at the end of the lease ternm, and the sole activity of the CCA is to provide financing for the City. As such, the financial data for the CCA has been blended into the City's CAFR in the government-wide business-type activities and in the fund financial statements with the City's Convention, Sports and Entertaimnent Venues Fund, as all activity related to the Anaheim Convention Center is accounted for in this enterprise fund. The capital lease has been eliminated in the financial statements.
For a copy of the CCA's separate financial statements, contact the Finance Director of the City.Anaheim Public Improvement Corporation (APIC), a nion-profit corporation, was created primarily to finance several construction projects in the City. City Council Members, in separate session, serve as the governing board of APIC. The City has entered inio noncancelable long-term leases with APIC. which provide for lease payments in amounts sufficient to meet tile annual debt service requirements on the certificates of participation issued by APIC to finance these construction projects:
The leases are financing arrangements, which transfer ownership of the constructed assets to the City at the end of the lease terms. The financial data of APIC has been blended into various governmental and business-type activities and finds of the City as applicable, and the capital leases have been eliminated.
Anaheim Public Financing Authority (Authority), a joint powers authority, was established as a vehicle to reduce local borrowing costs and promote greater use of existing and new financiai instruments and mechanisms.
City Council Members, in separate session, serve as the governing board of the Authority.
Financial activity of the Authority has been blended into the City's CAFR into various governmental and business-type activities and funds of the City as applicable.
The City is a participant in three joint ventures and jointly-owned properties (see note 12), which are not considered part of the financial reporting entity, as the City does not have any significant equity interests in the joint ventures and jointly-owned properties.
37 CITY OF ANAHEIM Basic financial statements In accordance with GASB Statement No. 34 -Basic Financial Statements and Management
.' Discussion and Analysis f.or State and Local Governments, the basic financial statements include both government-wide and fund financial statements.
The government-wide financial statements (Statement of Net Assets and Statement of Activities) report on the City and its component units as a whole, excluding fiduciary activities.
Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. All activities, both governmental and business-type, are reported in the government-wide financial statements using the economic resources measurement focus and the accrual basis of accounting, which includes long-term assets and receivables as well as long-term debt and obligations.
The government-wide financial statements focus more on the sustainability of the City as an entity and the change in aggregate financial position resulting from the activities of the fiscal period.Generally, the effect of interfund activity has been removed from the government-wide financial statements, except for interfund services provided and used. Net interfund activity and balances between governmental activities and business-type activities are shown in the government-wide financial statements.
The "doubling up" effect of internal service fund activity has been eliminated from the government-wide financial statements with the expenses shown in the various functions and programs on the Statement of Activities.
The government-wide Statement of Net Assets reports all financial and capital resources of the City (excluding fiduciary funds). It is displayed in a format of assets less liabilities equal net assets, with the assets and liabilities shown in order of their relative liquidity.
Net assets are required to be displayed in three components:
- 1) invested in capital assets, net of related debt, 2) restricted, and 3) unrestricted.
Invested in capital assets, net of related debt represents capital assets net of accumulated depreciation which is reduced by outstanding balances of any bonds, notes or other borrowings that are attributable to the acquisition, construction, or improvement of those assets. Restricted net assets are those with constraints placed on their use by either: 1) externally imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments, or 2) imposed by law through constitutional provisions
'or enabling legislation.
All net assets not otherwise classified as restricted, are shown as unrestricted.
Generally, the City would first apply restricted resources when an expense is incurred for purposes for which both restricted and unrestricted net assets are available.
The government-wide Statement of Activities demonstrates the degree to which both direct and indirect expenses of the various functions and programs of the City are offset by program revenues.
Direct expenses are those that are clearly identifiable with a specific function or program. Indirect expenses for administrative overhead are allocated among the functions and programs using a full cost allocation approach and are presented separately to enhance comparability of direct expenses between governments that allocate direct expenses and those that do not. Interest on general long-term debt is not allocated to the various functions.
Program revenues include: 1) charges to customers or users who purchase, use or directly benefit fiom goods, services or privileges provided by a particular function or program and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or program. Taxes, unrestricted investment income and other revenues not identifiable with particular functions or programs are included as general revenues.
The general revenues support the net costs of the functions and programs not covered by program revenues.Also, part of the basic financial statements are fund financial statements for governmental funds, proprietary finds and fiduciary funds, even though the latter are excluded from the government-wide financial statements.
The focus of the find financial statements is on major fuids, as defined by GASB Statement No. 34. Although this reporting model sets forth minimum criteria for determination of major funds (a percentage of assets, liabilities, revenues, or expenditures/expenses of fund category and of the governmental and enterprise funds combined), it also gives governments the option of displaying other funds as major funds. Other nonmajor funds, as well as the internal service funds, are combined in a single column on the fund financial statements.
The City reports the following major governmental funds: The General Fund is the City's primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted foe in another fund.The Housing Authority Special Revenue Fund accounts for the providing of housing assistance to low and moderate-income families in the Anaheim area. Financing is provided primarily from Federal Section 8, U.S. Department of Housing and Urban Development (HUD) receipts.The City reports the following major enterprise funds: The Electric Utility Fund accounts for the operation of the City's electric utility, a self-supporting activity, which renders services on a user charge basis to residents and businesses located in Anaheim.The Water Utility Fund accounts for the operation of the City's water utility, a self-supporting activity, which renders services on a user charge basis to residents and businesses located in Anaheim.38 CITY OF ANAHEIM The Sanitation Fund accounts for the operation of the City's solid waste and sanitation program, a self-supporting activity, which provides for the collection and disposal of solid waste, street sweeping, and sanitary sewer cleaning on a user charge basis to residents and businesses located in Anaheim.The Golf Courses Fund accounts for the operation of the Anaheim Municipal
("Dad Miller") Golf Course and the Anaheimn Hills Golf Course, a self-supporting activity that renders services on a user charge basis.The Convention, Sports and Entertainment Venues Fund accounts for the operations of the Anaheim Convention Centel, Angel Stadium of Anaheim, and The Grove of Anaheim.See note 13 for further discussions of the Angel Stadium of Anaheim and The Grove of Anaheim.The internal service funds, which provide services to the other funds of the City, are presented in a single colunm in the proprietary funds financial statements.
Because the principal users of the internal service funds are the City's governmental activities, the assets and liabilities of the internal service funds are consolidated into the governmental activities column of the government-wide Statement of Net Assets. The costs of the internal service fund services are spread to the appropriate function or program on the government-wide Statement of Activities and the revenues and expenses within the internal service funds are eliminated from the govermnent-wide financial statements to avoid any doubling effect of these revenues and expenses.
The City operates five internal service funds: The General Benefits and Insurance Fund is used to account for employee compensated absences, retirement and health benefits, and self-insurance programs.The Motorized Equipment Fund is used to account for motorized equipment used by City departments.
The Duplicating and Printing Fund is used to account for central duplicating, printing, and mailing services provided to City departments.
The Infonnation Services Fund is used to account for data processing services to City departments.
The Municipal Facilities Maintenance Fund is used to account for office maintenance services and equipment used by City departments.
Measurement focus and basis of accounting The governmental funds financial statements are prepared on a current financial resources measurement focus and modified accnial basis of accotmting.
To conform to the modified accrual basis of accounting, certain modifications must be made to the accrual method.These modifications are outlined below: Revenue is recorded when it becomes both measurable and available (received within 60 days alter year-end).
Revenue considered susceptible to accrual includes: property taxes, sales and use taxes, transient occupancy taxes, licenses, fees and permits, intergovernmental revenues (including motor vehicle license fees), charges for services, fines, forfeits and penalties, and interest.Expenditures are recorded when the related fund liability is incurred.
Principal and interest on general long-term debt are recorded as fund liabilities when due or when amounts have been accumulated in the debt service fund for payments to be made early in the following year.* Disbursements for the purchase of capital assets providing future benefits are considered expenditures.
Bond proceeds are reported as an other financing source.With this measurement focus, operating statements present increases and decreases in net current assets and unreserved fund balance as a measure of available spendable resources.
This is the traditional basis of accounting for governmental funds and also is tile manner in which these funds are normally budgeted.
This presentation is deemed most appropriate to: 1) demonstrate legal and covenant compliance, 2) demonstrate the sources and uses of liquid resources, and 3) demonstrate how the City's actual revenues and expenditures conform to the annual budget. Since the governmental funds financial statements are presented on a different basis than the governmental activities column of the government-wide financial statements, a reconciliation is .provided immediately following each fund statement.
These reconciliations briefly explain the adjustments necessary to transform the fund financial statements into the governmental activities column of the government-wide financial statements.
The proprietary funds financial statements are prepared on the same basis (economic resources measuremeent focus and accrual basis of accounting) as the government-wide financial statements.
Therefore, most lines for the total enterprise funds on the proprietary funds financial statements will directly reconcile to the business-type activities column on the government-wide financial statements.
Because the enterprise funds are combined into a single business-type activities column oin the government-wide financial statements, certain interfund activities between these funds are eliminated in the consolidation for the government-wide financial statements, but are included in the fund columns in the proprietary funds financial statements.
The net costs of the internal service funds are also partially allocated to the business-type activities column on the government-wide financial statements.
A reconciliation of the total enterprise funds on the fund financial statements to the business-type activities column on the governuent-wide financial statements is provided on the face of the flud financial statements.
39 CITY OF ANAHEIM Enterprise funds account for operations where the intent of the City is that the costs of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges and fees. Under GASB Statement No. 34, enterprise funds are also required for arty activity whose principal revenue sources meet any of the following criteria:
- 1) any activity that has issued debt backed solely by the fees and charges of the activity, 2) if the cost of providing services for an activity, including capital costs such as depreciation or debt service, must legally be recovered through fees and charges, or it is the policy of the City to establish activity fees or charges to recover the cost of providing services, including capital costs.On the proprietary funds financial statements, operating revenues are those that flow directly from the operations of the activity, i.e. chatges to customers or users who purchase or use the goods or services of that activity.
Operating expenses are those that are incurred to provide those goods'or services.
Non-operating revenues and expenses are items such as investment income and interest expense that are not a result of the direct operations of the activity.Under GASB Statement No. 20, Accounting and Financial Reporting .br Proprietary Funds and Other Governmental Entities That Use Proprietary FundAccounting, the City has elected for proprietary funds not to apply Financial Accounting Standards Board (FASB) statements issued after November 30, 1989.The Electric and Water .Utility funds follow the uniform system of accounts prescribed by the Federal Energy Regulatory Commission (Electric Utility) and the California Public Utilities Commission (Water Utility).
The utilities are not subject to the regulations of these commissions.
Fiduciary funds account for assets held by the City in a trustee or agency capacity on behalf of others and, therefore, are not available to support City programs.
The reporting focus is upon net assets and changes in net assets and employs accounting principles similar to proprietary funds. Fiduciary funds are not included in the government-wide financial statements as they are not an asset of the City available to support City programs.The City currently maintains an agency fund to account for the monies collected and paid on behalf of the Mello-Roos Districts located in the City.Cash and investments The City pools available cash from all funds for the purpose of increasing income through investment activities.
Investments in U.S. government and agency securities and corporate notes are carried at fair value based on quoted market prices. Participating guaranteed investment contracts and flexible repurchase agreements are carried at fair value based on net realizable value. Money market mutual funds are carried at fair value based on the fund's share price. The City's investment in the State of California Local Agency Investment Fund (LAIF) is carried at fair value based on the value of each participating dollar as provided by LAIE LAIF is authorized by California Government Code Section 16429 under the oversight of the Treasurer of the State of California.
Commercial paper, non-participating guaranteed investment contracts and negotiable certificates of deposit are carried at amortized cost (which approximates fair value). Interest income, which includes'changes in fair value, on investments is allocated to all funds on the basis of daily cash and investment balances.
See note 2 for further discussion.
For purposes of the basic financial statements, the City considers cash equivalents to be highly liquid short-term investments that are readily convertible to known amounts of cash and mature within three months of the date they are acquired.
Cash and cash equivalents are included in the City's cash and investments pool and in accounts held by fiscal agents.Notes receivable In the government-wide financial statements, notes receivable of $39,384 includes accrued interest receivable of $10,658, ranging from 3% to 10% interest per anmum, and is net of allowances of $14,121 for uncollectible accounts at June 30, 2007. Allowances for uncollectible accounts were estimated based on certain assumptions; therefore, actual results could differ from the estimates.
In the governmental funds financial statements, due to the extended period of time over which notes receivable are to be collected and the contingent nature of certain sources of repayment, the City has generally not recorded the related accrued interest and has recorded deferred revenue equal to the outstanding principal balance of the notes receivable.
Inventories Inventories, as determined by annual physical counts, are stated at average cost.Inventories in the General Fund are recorded as expenditures when used and are reported under the consumption method of accounting.
Land held for resale The Redevelopment Agency has acquired parcels of land as part of their primary purpose to develop or redevelop blighted areas. The Redevelopment Agency records these parcels as land held for resale in their financial records. The properties held for resale are recorded at the lower of cost or estimated net realizable value. At June 30, 2007, land held for resale with a cost of $89,700 was recorded net of the allowance for decline in value of $25,626 and totaled $64,074, with this amount offset by a reservation of fund balance in the governmental funds financial statements.
40 CITY OF ANAHEIM Restricted assets Certain proceeds of the City's bonds, as well as certain resources set aside for their repayment, are classified as restricted on the Statement of Net Assets, Balance Sheet, or Statement of Fund Net Assets, because they are maintained in separate bank accounts and their use is limited by applicable debt covenants.
Additionally, resources set aside by the Electric Utility for future decommissioning of its ownership share of the San Onofre Nuclear Generating Station, Units 2 and 3 (SONGS) and the San Juan Generating Station, Unit 4, are classified as restricted on both the government-wide Statement of Net Assets and proprietary funds Statement of Fund Net Assets.Capital assets Under GASB Statement No. 34, all capital assets, whether owned by governmental activities or business-type activities are recorded and depreciated in the govenunent-wide financial statements.
No long-term capital assets or depreciation are shown in the governmental funds financial statements.
Capital assets, including public domain infrastructure (e.g., roads, bridges, sidewalks and other assets that are immovable and of value only to the City) are defined as assets with an initial, individual cost of more than $5 ($50 for infrastructure) and an estimated useful life greater than one year. Capital assets are recorded at cost or estimated historical cost if purchased or constructed.
Donated capital assets are recorded at the estimated fair market value at the date of donation.The costs of nomal maintenance and repairs that do not add to the value of the capital asset or materially extend capital assets lives are not capitalized.
Major improvements are capitalized and depreciated over the remaining useful lives of the related capital assets.Major outlays for capital assets and improvements are capitalized as the projects are constructed.
Interest incurred during the construction phase of projects is reflected in the capitalized value of the asset constructed for proprietary funds. For the year ended June 30, 2007, business-type activities capitalized net interest costs of $5,318 in the government-wide and fund financial statements.
Total interest expense incurred by the business-type activities (and the enterprise funds on the proprietary funds statements) before capitalization was $35,612.Capital assets are depreciated using the straight-line method over the following estimated useful lives: Capital assets transferred between fuids are transferred at their net book value (cost less accumulated depreciation), as of the date of the transfer.Debt costs Debt issuance costs in the amount of $12,675 are included in noncurrent assets at June 30, 2007. Unamortized discounts, consisting of refunding costs of $11,820 reduced by premiums net of discounts of $8,427, are reflected in net long-term obligations.
Both debt issuance costs and premiums net of discounts are amortized over the life of the related bond issue using the effective interest method. Refunding costs are amortized over the life of the new bond or the life of the old bond, whichever is shorter, using the effective interest method.Accretion Accretion is an adjustment of the difference between the price of a bond or certificate of participation (COP) issued at an original discount and the par value of the bond or COP For the governmental activities debt, the accreted value is recognized as it accrues by fiscal year. For the business-type activities debt, the accreted value at maturity is recognized at the time of issuance with an offset to bond or COP discount.Regulatory credits Tire Electric Utility's rates, rules and regulations provide for a power cost adjustment billing factor to reflect variations in the cost of power to the Electric Utility. This billing factor provides increased flexibility by allowing the adjustment of revenues from the sale of electricity for differences between the Electric Utility's actual cost of power and the amount billed to customers through standard rates. The over or under collections are recorded as regulatory credits until they are refinded to or recovered from utility customers.
The Electric Utility obtained City Council approval to change the rate from $0.0099 to $0.0149 for all domestic retail kilowatt hour (kWh) sales and from $0.0090 to $0.0140 for all non-domestic retail kWh sales of electricity, except residential lifeline usage customers, begimming January 1, 2007. At June 30, 2007, the liability recorded for regulatory credits totaled $72,640 for the Electric Utility.The Water Utility's rates, rules and regulations provide for a water rate stabilization account to reflect variations in the cost of water to the Water Utility. This stabilization account provides increased flexibility by allowing the adjustment of revenues from the sale of water for differences between the Water Utility's actual cost of water and the amount billed to customers through standard rates. The account is funded through expense reimbursements such as water supply cost refunds received from theMetropolitan Water District and Orange County Water District and other miscellaneous credits and revenue. At June 30, 2007 the liability recorded for regulatory credits totaled $828 for the Water Utility.Buildings, structures and improvements Utility plant Machinery and equipment Infrastructure 5 to 85 years 5 to 75 years 2 to 40 years 25 to 75 years 41 CITY OF ANAHEIM Deferred revenues Deferred revenues arise hi govenmnental funds when reveniue does not meet both the"measurable" and "available" criteria for recognition in the current period. Deferred revenues also arise, in both governmental and proprietary funds, when resources are received by the government before it has a legal claim to them, as when grant monies are received prior to incurring qualifying expenditures/expenses (unearned).
hi subsequent periods, when both revenue recognition criteria are met, or when the government has a legal claim to the resources, revenue is recognized.
Deferred revenues in the governmental funds amounted to$81,434 at June 30, 2007. Of this amount, $42,847 representsnotes receivable that did not meet the available criterion, $33,261 represents various other revenues that did not meet the available criterion, and $5,326 represents resources for which the City did not have legal claim.'Compensated absences Compensated absences, vacation and sick pay, for all City employees are generally paid by the General Benefits and Insurance Fund, an internal service fund. The General Benefits and Insurance Fund is reimbursed through payroll charges to all other funds based on estimates of benefits to be earned and used during the fiscal year. It is the policy of the City to pay all accumulated vacation pay when an employee retires or terminates.
Accumulated sick pay in excess of 175 hours0.00203 days <br />0.0486 hours <br />2.893519e-4 weeks <br />6.65875e-5 months <br /> per employee is paid to employees at their then current rate of pay in January each year or upon termination from the City. Employees are paid for all accumulated sick pay when they retire from the City. Vested vacation and sick pay benefits are accrued when incurred in the General Benefits and Insurance Fund and at June 30, 2007, totaled $16,253 and is included in wages payable in the Statement of Net Assets. Also included in wages payable in the Statement of Net Assets at June 30, 2007, is compensatory time liability of $267.Changes in the City's compensated absences liability in fiscal year 2007 were as follows: California where it is located. The Electric Utility funds the reserve and recognizes this expense over the remaining useful life of the generating plant. A separate trust account has been established for prior and future amounts funded and these amounts are classified as restricted assets in the accompanying balance sheets. At June 30, 2007, the provision for decommissioning costs totaled $102,124.
For the year ended June 30,-2007, the Electric Utility has recorded decommissioning costs incurred for SONGS in the amount of $5,811, which is included in the fuel and generation component in operating expenses.The City sold its ownership share in SONGS to Southern California Edison (SCE) on December 29, 2006. The Electric Utility's decision to divest SONGS was largely based on the need for operating flexibility to provide both peak and base load power, ongoing cost concerns for environmental disposal of nuclear waste and marine mitigation, as well as escalating decommissioning costs. See note 12 for further discussion.
The California Public Utilities Commission approved a cost estimate by SCE for the decommissioning costs of SONGS. The Electric Utility currently has $102,124 in trust for the decommissioning costs with an assumed rate of return of 4% per year. At June 30, 2007, SCE's future cost estimate for the Electric Utility's share of decommissioning costs is $105,887.
Based on an assumed 4% rate of return, it is estimated that the Electric Utility's current reserve of $11)2,124 will grow to $183,919 by 2022, which exceeds SCE's future cost estimate of $158,984.
Based on these estimates the Electric Utility does not expect that it will need to further fund the provision for decommissioning with cash contributions for SONGS.The Electric Utility has a 10.04% ownership interest of the San Juan Generating Station, Unit 4 (SJ). The Electric Utility is providing for the future demolition and reclamation costs of its ownership share of SJ. As of June 30, 2007 the Electric Utility has recorded a provision for decommissioning costs for SJ of $1,320. For the year ended June 30, 2007 the Electric Utility has recorded decommissioning costs incurred for SJ of $440 in operating expenses.
Based on the cost estimates, the Electric Utility has estimated
$440 in costs per year until 2027 to fund this obligation.
Pension plan Full-time City employees are members of the State of California Public Employees' Retirement System (System).
The City's policy is to fund all pension costs accrued: such costs to be funded are determined annually as of July 1 by the System's actuary. See note II for further discussion.
Compensated absences liability at beginning of year Current year compensated absences benefits earned Current year compensated absences used Compensated absences liability at end of year$ 16,244 18,542 (18,266)$ 16,520 The compensated absences liability is expected to be liquidated during the next fiscal year and is considered a current liability in the financial statements.
Nuclear fuel and decommissioning costs Net assets restricted by enabling legislation Federal regulations require the Electric Utility to provide for the future decommissioning costs of its ownership share of SONGS. The Electric Utility has established a provision for decomnnissioning costs of SONGS and restoration of the beachfiont at San Onofre, The government-wide Statement of Net Assets reports $69,949 of governmental activities restricted net assets, of which $32,216 is restricted by enabling legislation.
42 CITY OF ANAHEIM Fund balances Property taxes In the fund financial statements, governmental funds report reservations of fund balances for amounts that are not available for appropriation or are legally restricted by outside parties for use for a specific purpose. Designations of fund balance represent tentative management plans that are subject to change.The accumulated deficit fund balances at June 30, 2007, for Workforce Development, Community Development Block Grant, and Grants funds included in nonmajor governmental funds in the amount of $109, $360 and $9,386 respectively, will be eliminated in future years by the receipt of reimbursements for grant expenditures.
Budgetary principles The City is required by its charter to adopt an ammal budget on or before June 30 for the ensuing fiscal year. The General, special revenue, debt service, and capital projects governmental fund types and proprietary fund types have legally adopted budgets approved by City Council. The level of budgetary control (that is, the level at which expenditures cannot legally exceed the appropriated amount) is established at the department level. From the effective date of the budget, the amounts stated therein as proposed expenditures/expenses become appropriations to the various City departments.
Throughout the fiscal year the budget was amended to add supplemental appropriations.
All amendments to the budget which change the total appropriation amount for any department require City Council approval and all increases in appropriations must be accompanied by an increase in revenue sources of a like amount to maintain a balanced budget. The City Manager has the authority to change individual budget line items within a department as long as the total department's appropriation amount is not changed.The City utilizes an encunbrance system as a managemennt control technique to assist in controlling expenditures.
All appropriations lapse at the end of the fiscal year, except for capital projects (other than the Redevelopment Agency Capital Projects Fund), which are carried forward until such time as the project is completed or terminated and for encumbered balances that are re-appropriated in the next year.GASB Statement No. 34 requires that budgetary comparison statements for the General Fund and major special revenue funds be presented in the basic financial statements.
These statements must display original budget, amended budget and actual results.Budgeted revenue amounts represent the original budget modified by City Council-authorized adjustments during the year, which were contingent upon new or additional revenue sources. Budgeted expenditure amounts represent original appropriations adjusted for supplemental appropriations during the year. Budgets are generally prepared in conformity with GAAP using the modified accrual basis of accounting, with tile exception of capital leases and land held for resale, which are budgeted on a cash basis.Property taxes attach as an enforceable lien on property as of January I. Taxes are levied on July 1 and are payable in two installments due on November 1 and February I and become delinquent after December 10 and April 10. The County of Orange, California (County) bills and collects the property taxes and remits them to the City in installments during the year. City property tax revenues are recognized when levied to the extent that they result in current receivables collectable within 60 days after year-end.The County is pennitted by State law (Proposition
- 13) to levy taxes at 1% of full market value (at time of purchase) and can increase the property tax rate no more than 2% per year from the full market value at the time of purchase.
The City receives a share of this basic levy proportionate to what it received in the 1976 and 1978 periods.Entitlements, shared revenues and grants Entitlements and shared revenues are recorded at the time of receipt or earlier if the susceptible to accrual criteria are met. Expenditure-driven grants are recognized in the fund financial statements as revenue when the qualifying expenditures have been incurred, all eligibility requirements have been met, and reimbursement is received within the availability period.Revenue recognition for Electric Utility, Water Utility, and Sanitation Funds Revenue is recorded in the period in which seivices are provided.
Residential and smaller commercial customers are billed bimonthly and all other customers monthly. At June 30, 2007 unbilled but earned service charges recorded in accounts receivable for tile Electric Utility, Water Utility, and Sanitation Funds amounted to $14,456, $3,428, and $3,694 respectively.
Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of certain assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenditures/expenses during the reporting period. As such, actual results could differ from those estimates.
NOTE 2 -DEPOSITS AND INVESTMENTS:
The City maintains a cash and investment pool, which includes the cash balances of all funds, and is invested by the City Treasurer to enhance interest earnings.
The pooled interest earned, net of administrative fees, is allocated to each fund based on daily cash balances.43 CITY OF ANAHEIM The City's investment policy further limits the permitted investments in California Government Code (Government Code) Sections 53600 et al, 16429.1 and 53684 to the following:
obligations of the United States government, federal agencies, and government sponsored enterprises-medium-term corporate notes; certificates of deposit; bankers'acceptances; commercial paper rated A-I by Standard and Poor's Corporation (S&P), P-1 by Moody's Investors Service (Moody's) or F- I by Fitch Ratings (Fitch); LAIF; repurchase agreements; reverse repurchase agreements; and money market mnutual funds.Deposits and investments are comprised of the following at June 30, 2007: Restricted Cash and Cash and Cash Cash Restricted Equivalents Investments Equivalents Investments Total Investments The City Treasurer prepares an investment policy statement annually that is presented to the Investment Advisory Commission for review and then to the City Council for approval.The approved investment policy is submitted to the California Debt and Investment Advisory Committee in accordance with Government Code.The policy provides the basis for the management of a prudent, conservative investment program. Public funds are invested for the maximum security of principal, to meet daily cash flow needs, while providing a return. All investments are made in accordance with the Government Code and, in general, the City Treasurer's policy is more restrictive than Government Code. The City did not have any violations of its policy during the current fiscal year. Section 53607 of the Government Code allows the City Council to delegate its investment authority to the City Treasurer and requires that the City Treasurer provide a monthly report to the City Council of its investment transactions.
The annual delegation of authority is incorporated in the investment policy. The City Treasurer's report meets the requirements for monthly investment reporting.
Investments authorized by the Government Code and the City's investment policy The table below identifies the investment types that are authorized for the City by its investment policy which is more restrictive than Government Code. The table also identifies certain provisions of the City's investment policy that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustees.
Investments of bond proceeds held by trustees are governed by the provisions of each debt agreements.
Governmental activities:
General Fund Housing Authority Nonmajor governmental funds Internal service funds Total governmental activities Business-type activities:
Electric Utility Water Utility Sanitation Golf Courses Convention, Sports and Entertainment Venues Total business-type activities Government-wide total S 10,926 3,289 23,173 47,066 84,454 55,135 9,245 10,600 221 9,383 84.584 169,038$ 22,814 6,868 49,329 98.135 177,146 115,764 19,410 22,137 461 19,457 177.229 354,375$5,727 19,218 18 24_,2963 13,540 1,271 1,538 802 17,151 42,114 4,277$46,391$ 25,197 472 25,669 234,643 5,218 47,412 15,772 303,045 328,714$328-714$ 33,740 15,884 116,917 145,691 312,232 419,082 35,144 81,687 682 45,414 582.009 894,241 4,277$898-518$ 4,713 893,805$898,518 Fiduciary fund _Total cash and investments
$169,038 $354_375 Deposits and investments is comprised of the following at June 30, 2007: Deposits Investments Total deposits and investments At June 30, 2007, deposits of $4,713, with a corresponding bank balance of $6,171, were maintained in various federally regulated financial institutions.
The difference of $1,458 represents deposits in transit, outstanding checks, and other reconciling items. Deposits with a bank balance of $480 are insured by the Federal Depository Insurance Corporation.
For deposits with a bank balance of $5,691, California state statutes require federally regulated financial institutions to secure a city's deposits by pledging collateral consisting of either government securities with a value of 110% of a city's total deposits or by pledging first trust deed mortgage notes having a value of 150% of a city's total deposits.The collateral is required by regulation to be held by the counterparty's agent in the name of the City.Authorized Investment Type U.S. Treasury obligations U.S. agency securities Bankers' acceptances Commercial paper Negotiable certificates of deposit Repurchase agreements Reverse repurchase agreements Medium-tenm corporate notes Money market nmutual finds LAIF Time certificates of deposit (TCD)*Excluding amounts held by bond restrictions Maximumn Maturity 5 years 5 years 180 days 270 days 3 years 90 days 92 days 5 years N/A N/A 5 years Maximnumn Percentage of Portfolio*
None 75%25%25%15%75%20%15%20%$80,000 30%Investment in One Issuer None 20%5%5%5%None None 5%IO%None 5%trustee that are not subject to Government Code 44 CITY OF ANAHIEINI At June 30, 2007 the City exceeded five percent concentration in the following U.S.agency securities:
Federal Famn Credit Bank $47,143 (8%), Federal Home Loan Bank$74,162 (13%), Federal Home Loan Mortgage Corporation
$33,341 (6%), and Federal National Mortgage Association
$41,516 (7%).Investments authorized by debt agreements Investment of debt proceeds held by bond trustees is governed by provisions of the debt agreements, rather than the general provisions of the Government Code or the City's investment policy. The table below identifies the investment types that are authorized for investments held by bond trustees.
The table also identifies certain provisions of these debt agreements that address interest rate risk, credit risk, and concentration of credit risk.party. All securities held by bond trustees are in the name of the bond issue in trust for safekeeping with the bond trustee, which is different from the City's primary bank.Interest rate risk Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment.
The City Treasurer mitigates this risk by investing in longer-term securities only with funds that are not needed for current cash flow purposes and holding these securities to maturity.
The City Treasurer uses the segmented time distribution method to identify and manage interest rate risk. In accordance with the City investment policy, the City Treasurer monitors the segmented time distribution of its investment portfolio and analysis of cash flow demand.Investments held by bond trustees are typically long-term securities which are not adversely affected by interest rate changes. Guaranteed ilvestment contracts for construction funds are usually limited to three years or less.Information about the sensitivity of the fair values of the City's investments (including investments held by bond trustees) to market interest rate fluctuations is provided by the following table that shows the distribution of the City's investments by maturity at June 30, 2007: Authorized Investment Type U.S. Treasury obligations U.S. agency securities Guaranteed investment contracts Collateralized investment contracts Flexible repurchase agreements Money market mutual funds LAIF Maxinum Maturity None None None None None None None Maximum Percentage Allowed None None None None None None None Maxinmum Investment in One Issuer None None None None None None None At June 30, 2007 the investments controlled by fiscal agents exceeded five percent concentration in the following U.S. agency securities, guaranteed investment contracts, and collateralized investment contracts:
Federal Home Loan Bank $58,312 (18%), Federal Home Loan Mortgage Corporation
$26,928 (8%), XL Asset Funding Corporation
$47,412 (15%), and Rabobank Nederland
$62,244 (19%). All guaranteed investment contracts have downgrade language that requires collateral should credit ratings drop below certain levels.Custodial credit risk Custodial credit risk for investments is the risk that the City will not be able to recover the value of investment securities that are in the possession of an outside party. All securities owned by the City with the exception of LAIF and money market mutual fuids are deposited in trust for safekeeping with a custodial bank different from the City's primary bank. Securities are not held in broker accounts.
Funds held by L-AIF and money market mutual funds are held in the City's name.Custodial credit risk for investments held by bond trustees is the risk that the City will not be able to recover the value of investment securities that are in the possession of an outside Itvestments Investments controlled by City Treasurer:
U.S. Treasury obligations U.S. agency securities Medium-term notes Commercial paper Money market uintual funds LAIF Total investments controlled by City Treasurer Investments controlled by bond trustees: U.S. Treasury obligations U.S. agency securities Guaranteed investment contracts Collateralized inveslment contracts Flexible repurchase agreements Money market mutual funds LAIF Total investments controlled by bond trustees Total investments Fair Credit Value a 6/30/2007 12 13 Months to or 24 Less Months 25 37 More to to Than 36 60 60 Months Months Months Exempt AAA AI-A+PI-A +AAA Unrated Exempt AAA Unrated Unrated Unrated AAA Unrated S162,134 201,080 22.251 105,203 33,831 46,100$101.436 57.663 7.046 105,203 33,831 46.100$60,698 50,935 S 7,009 S 851473 4,999 10,206 570,599 351,279 116,632 7 3 __607 100,058 64,296 96,214 37,066 22,959 2,006 607 47,412 62,244 2.397 28,411 71,647$16,884 33,970 25,053 9,616 22,959 2.006 323,206 25.572 112.053 21,41_ 96,700 60,470$893,805 $376,851 $221,685 4 $182,173 $60.470 45 CITY OF ANAHEIM NOTE 3 -ACCOUNTS RECEIVABLE, DUE FROM OTHER GOVERNMENTS, INTERFUND RECEIVABLE AND PAYABLE BALANCES, AND CERTAIN INTERFUND TRANSACTIONS:
Accounts receivable Accounts receivable for the City's governmental and business-type activities, including the applicable allowance for uncollectible accounts at June 30, 2007, are as follows: Interfund receivable and payable balances Net internal balances between governmental activities and business-type activities of$2,029 are included in the government-wide financial statements at June 30, 2007.Interfund receivables and payables that are included in the fund financial statements at June 30, 2007, are as follows: Interfund Interfund Receivable Payable Less: Accounts Allowance for Receivable Uncollectibles Governmental activities:
-General Fund Nonmaajor governmental funds Internal service funds Total governmental activities Business-type activities:
Electric Utility Water Utility Sanitation Golf Courses Convention, Sports and Entertainment Venues Total business-type activities Total accounts receivable
$11,544 67 872 12.483 35,147 6,123 6.923 197 1,953 50,343$62.826$(1,134)(2)(108)(3)(58)(34)(203)$(1.339)$Governmental funds: Total General Fund Ilousing authority 10,410 Nonmajor governtiental funds 65 Total governmental funds 872 Enterprise funds: 11,347 Electric Utility Golf Courses 35,039 Convention, Sports and Entertaimtient Venues 6,120. Total enterprise funds 6,865 Internal service funds 197 total$17,718 657 11.611 29,986 4201 10,368 10,788 79$40,853$ 79 34.964 35,043 5,390 420 5,810$40,853 50,140$61,487 Due from other governments Due from other governments for the City's governmental activities at June 30, 2007, are as follows: Taxes Grants Governmental activities:
General Fund $15,221 Housing Authority Nonusajor governmental funds 697 Total due from other governments
$15,918$ 284 30,308$30,592 Other$297$297 Total$15,518 284 31,005 Certain interfund balances at June 30, 2007 that are generally short-term loans to cover temporary cash deficits in various funds. The following interfund balances are expected lo be repaid in more than one year: General Fund Of the total intierfund receivable in the General Fund, $855 is due from nonmajor governmental funds (Redevelopment Agency Capital Projects Fund). The balance is expected to be repaid frotifuture proceeds of the Anaheitn Westgate Center (Westgate).
Of the total interfund receivable in the General Fund, $5,390 is due from the Golf Courses Fund: On September 24, 2002, the City Council approved a loan up to $6,400 from the General Fund to the Golf Courses Fund for construction of the Anaheim Hills Golf Clubhouse.
The loan is payable in annual amounts of not less than $548 beginning in July 2005 until July 2023 and bears interest at the City's investment yield as of June 30th of each year.Housing Authority Of the total interfund receivable in the Housing Authority Special Revenue Fund, $162 is due from nonmajor governmental ftnds (Redevelopment Agency Capital Projects Fund). On May 26, 2006, the Housing Authority entered into an agreement with the Revenues are reported net of estimated uncollectible amounts. TIotal estimated uncollectible amounts related to revenues of the current period are as follows: General Fund Electric Utility Water Utility Sanitation Othcrs Total$193 352 19 134 33$731 46 CITY OF ANAHIEIM Redevelopment Agency to receive up to $200 in EPA Brownfields Revolving Loan Funds for mitigation activities at the Vine Street Affordable Housing site.Norunajor Governmental Funds Of the interfund receivable in the nonmajor governmental funds, $9,105 is due to the Other Capital Improvements Capital Projects Fund from nonmajor government funds (Redevelopment Agency Capital Projects Fund). The Redevelopment Agency entered into a Cooperation Agreement with the City on April 1, 2003 whereby the City will assist the Redevelopment Agency with the development of Westgate utilizing
$10,000 of fund from the HUD Section 108 loan program. The Redevelopment Agency is obligated to pay the City for the repayment of the HUD 108 loan from property tax increment and certain project revenues generated by Westgate.
At June 30, 2007, the Redevelopment Agency had utilized $9,423 of HUD 108 funds to acquire certain properties.
Of the interfund receivable in the nonmajor governmental funds, $1,788 is due to the Redevelopment Agency Capital Projects Fund from nonmajor goverrunental funds (Other Capital Improvements Capital Projects Fund). On March 15, 1999, the Redevelopment Agency entered into a Cooperation Agreement with the City where the Redevelopment Agency and the City will share in the cost of the west Lincoln Avenue Street improvement project. The Agreement also provides that the Redevelopment Agency will receive transportation fee credits in the amount of its contribution to the project.Electric Utility Fund The interfund receivable of $420 in the Electric Utility Fund is due from the Convention.
Sports and Entertainment Venues Enterprise Fund for the installation of energy efficient HVAC equipment, and building envelope improvements.
The loan is payable in monthly installments of $23 beginning January 2005 through December 2008.Convention, Sports and Entertainment Venues Fund The interfund receivable of $10,368 in the Convention, Sports and Entertainment Venues Fund is due from nonmajor governmental funds (Redevelopment Agency Capital Projects Fund). The City entered into a Cooperation Agreement with the Redevelopment Agency on May 14, 1996, for the renovation of the Angel Stadium of Anaheim. The Redevelopment Agency agreed to reimburse the City for $10,000 of renovation costs plus 5% simple interest on the unpaid balance. The Redevelopment Agency's reimbursement obligation is payable from the Stadium Project Area (SPA)property tax increment revenue. Any outstanding balance ceases to be an obligation of the Redevelopment Agency on August 9, 2039, the expiration of the SPA. It is expected that the balance will be repaid prior to the expiration of the SPA.Certain interfund transactions The net transfers of $42,874 from the governmental activities to the business-type activities on the government-wide Statement of Activities are primarily comprised of operational subsidies from business-type activities to the General Fund offset by debt service subsidies to the Convention, Sports and Entertainment Venues Fund. This amount is reduced by the transfer of capital assets from governmental activities to business-type activities in the amount of $53,395. The transfer of capital assets includes sewer system infrastructure capital assets, with a net book value of $51,425, that were transferred from governmental activities to business-type activities and are included in capital contributions in the Sanitation Fund.The following interfund transfers are reflected in the fund financial statements at June 30, 2007: Transfers In Transfers Out Governmental funds: General Fund Housing Authority Nonmajor governmental funds Total governmental funds Enterprise funds: Electric Utility Water Utility Sanitation Golf Courses Convention, Sports and Entertainment Vensues Total enterprise funds Internal service funds Total$ 30,506 3,664 67 079 101,249$ 57,950 2,237 30,841 91,028 16,315 456 2,942 2,215 2,000 12,495 12,951 23,472 300$114,500 $t14,500 The interfund transfers generally are made for the purpose of debt service payments made from'a debt service fund but funded from an operating fund or subsidy transfers.
Excluding the transferred capital assets detailed previously, there were no other significant transfers during the fiscal year that were either non-routine in nature or inconsistent with the activities of the fund making the transfer.47 CITY OF AiNAHEIM NOTE 4 -BOND PAYMENT RECEIVABLE:
On August 3, 1995, the Los Angeles Rams Football Company, currently the St. Louis Rams (Rains), exercised its right to terninate its lease under the Fourth Amendment to the Exhibition Agreement between the Rams and the City (Rams Agreement).
Under the Rams Agreement, the Rains became obligated to repay the City for the debt service on the 1979 Anaheim (California)
Stadium Inc. Lease Revenue Bonds in the principal amount of$28,110, which obligation is supported by an irrevocable standby letter of credit with Dresdner Bank AG and will be repaid by August 15, 2015. The 1979 Anaheim (California)
Stadium. Inc. Lease Revenue Bonds were subsequently refunded, and are no longer outstanding, by a portion of the Convention, Sports and Entertainment Venues Fund 1993 Refunding Projects Certificates of Participation.
At June 30, 2007, there remained principal outstanding of $16,927 on that portion of the Convention, Sports and Entertainment Venues Fund 1993 Refunding Projects Certificates of Participation.
During fiscal year 2007, the Rams reimbursed the City $2,372 (representing
$1,355 for principal and $1,017 for interest) for the current portion of their debt service obligation.
The City accounted for the termination of the lease by recording a bond payment receivable from the Rams and a contribution to the Convention, Sports and Entertainment Venues Enterprise Fund in the amount of the debt obligation assumed by the Rams under the Rains Agreement.
NOTE 5 -CAPITAL ASSETS: Capital asset activities for the year ended June 30, 2007, were as follows: Governmental activities:
Nondepreciable assets: Land Construction in progress Total Depreciable assets: Buildings, structures and improvements Machinery and equipment Infrastructure Total Total assets Beginning Balance$ 521,904 46.982 568,886" 233,705 93,418 741,502 1,068,625 1,637,511 Transfers Additions In (Out)Ending Deletions Balance$ 548,260$ (912 42,025 (912) 590.285$ 26,277 44,664 70,941 2,799 13.563 714 17,076 88,017 (6,059)(9,886)(15,615)(31,560)$ 56,457$ 79 (48,70)9 (48,630)25,100 8,241 (68.354)(35,013)(83,643)(114)(7,830)(1,2151 (9,159)(10,071)105 7,072 1,214 261,490 107,392 672,647 1,041,529 1,631,814 (91,149)*(54,693)(252,758)Less accumnulated depreciation fbr: Buildings, structures and improvements Machinery and equipment Infrastructure Total accumulated depreciation Total governmental activities capital assets, net (85,195)(51,879)(268,6105)
(405,679)ý$I,2382 30,248 30,248$L13,395)8.391 (398,600)$ (1,680) $1,233 214 Business-type activities:
Nondepreciable assets: Land $Construction in progress Nuclear fuel at amortized cost Total Depreciable assets: Buildings, structures and improvements Utility plant Machinery and equipment Total Total assets Less accumulated depreciation for: Buildings, structures and improvements Utility plant Machinery and equipment Total accumulated depreciation Total business-type activities capital assets, net $1 37,593 76,745$ 18,894$164,715 (95,207) $$ 56,487 (538) 145,715 2,792 531 -(3,323) I 117,130 165,246 (76,313) (3,861) 202,202 480,658.189,138 30,229 ,700,025 1817,155 (137,755)(489,625)(17,727)645,107),172,048 2,345 1,078 691 4,114 169,360 (12,099)(56,881)12,223)(71,203)$ 98,157 58,738 70,787 183 129,708 53,395 (147)(224,137)(271)(224,555)(228,416)40 224,746 174 541,594 1,036,866 30,832 1,609,292 1,811,494 (149,814)(321,760)(19,776)$ 53,395 224,960 (491,350)$ (3,456) $1,320,144 See note 12 for discussion of the sale of the SONGS utility plant.48 CITY OF ANAHEIM Depreciation expense was charged to functions/programs of the City during fiscal year 2007 as follows:$6,120, under operating leases. The following is a schedule of minimum future rentals on noncancelable operating leases at June 30, 2007: Govermnental activities:
General government Police Fire-Community Development Planning Public Works Community Services Convention, Sports and Entertaimnent Capital assets held by the City's internal service funds are chaiged to the various functions based on their usage of the assets Total depreciation expense -governmental activities Business-type activities:
Electric Utility Water Utility Sanitation Golf Courses Convention, Sports and Entertainment Venues Total depreciation expense -business-type activities
$ 360 2,065 638 1,295 214 15,971 2,216 3,137 5,664$31,560 49,927 6,954 1,246 670$71,203 Fiscal Year Ending June 30 21)08 2009 2t)10 2011 2012 20)!13-2017 2t)1 8-2022 2023-2027 2028-2032 2033-2034 Total minimum future rentals S 257 258 259 260 261 1,320 1,352 1,188 1,172 469$6,796 Capital leases Included in the capital assets amounts listed above are the following capitalized leased assets: Machinery and equipment Less accumulated amortization Capitalized leased assets, net Governmental Activities
$ 9,570 (2,863)$ 6,707 Business-type Activities
$ 679_(356$ 323 Total$10,249 (3,219)NOTE 6 -GENERAL BENEFITS AND INSURANCE FUND: The General Benefits and Insurance Fund, atn internal service fund, is used to account for employee compensated absences, retirement and health benefits, workers' compensation related benefits, self-insurance, commercial insurance purchases, and alternative risk financing activities.
Revenues of the General Benefits and Insurance Fund are derived from charges to City departments using estimates of benefits earned and cost allocation charges established at the beginning of ttle year and from interest income on reserves.At June 30, 2007, the City was fully funded for self-insured workers' compensation and general liability claims (self-insured retention levels of $ 1,000 per occurrence for workers'compensation claims and $1,000 per occurrence for general liability claims). Above these self-insured retention levels, the City's potential liability is covered through various commercial insurance and intergovernmental risk pooling programs (collectively,"Insurance").
Settled claims have not exceeded insurance coverage in any of the past three years, nor does management believe that there are any pending claims that will exceed insurance coverage.The unpaid claims liability included in the General Benefits and Insurance Fund is based on the results of actuarial studies and includes amounts for claims incurred but not reported and allocated loss adjustment expenses.
Claims liabilities are calculated using a discount rate of 4% and consider the effects of inflation, multi-year loss development trends, and other economic and social factors. It is the City's practice to obtain fitll actuarial studies biennially for general liability and workers' compensation coverages.
Pretniutns are charged by the General Benefits and Insurance Fund using various allocation methods that include actual costs, trends in claims experience, exposure base, and number of participants.
Changes in the General Benefits and Insurance Fund's claims liability in fiscal years 2007 and 2006 were as follows: Operating leases Housing Authority At Jtime 30, 2007, the Housing Authority earned revenues as the lessor of land, carried at cost of $40,461 in the government-wide financial statements, under four operating ground leases. These leases to developers are noncancelable.
Two of the leases are for a term of 55 years, expiring in 2055 and 2057. Two of the leases are for a tern of 57 years, expiring in 2060 and 2063. The total base rent amounts to be collected over the terms of the leases are $12,400, $8,700, $7,505, and $7,900, respectively, with simple interest accruting on unpaid portions at a rate of 4.0%, 4.5%, 4.0%, and 4.0%, respectively.
Minimum lease payments are calculated annually, based on residual receipts, as defined in the lease agreements.
It is estimated that the full amounts of the leases are collectible.
At June 30, 2007, the Housing Authority has recorded notes receivable due from developers related to these transactions of $6,267 in both the governttent-wide and fund financial statements.
Redevelopment Agency At June 30, 2007, the Redevelopment Agency earned revenues as lessor from certain parking structure property, carried at cost of $6,739, less accumulated depreciation of Current liability at begituning of year Current year claims and chatges in estimates Claims payments Claims liability at end of year 2007$30,828 6,137 (6,068)$30,897 2006$29,920 7,891 (6,983)$30,828 49 CITY OF ANAHEIM Current year total incurred losses remained essentially unchanged compared to the prior year.Above the self-insured retention of $1,000 per occurrence for workers' compensation losses, the City purchases excess insurance to $75,000 per occurrence.
Above the self-insured retention of $1,000 per occurrence for liability losses, the City purchases excess insurance for all City operations to $45,000 per occurrence, excluding (i) utilities operations for which the City purchases excess insurance to $70,000 per occurrence, and (ii) helicopter operations for which the City purchases
$50,000, per occurrence, of commercial excess insurance (on a first-dollar basis). The first layer of excess liability loss coverage is procured through the Authority for California Cities Excess Liability (ACCEL), a joint powers insurance authority pooling catastrophic general, automobile, personal injury, and public officials errors and omissions liability losses among twelve California cities, through both risk-sharing and joint purchase arrangements.
The City, therefore, continues to maintain some limited excess liability risk sharing exposure directly with ACCEL. This pooled coverage has exposure (i) from the run-out periods from prior years in which commercial excess insurance was not obtained, (ii) from losses which are covered under ACCELs Memorandum of Coverage but not covered under the commercial excess liability policies, and (iii) from anACCEL retained layer for fiscal year 2007 of $4,000 in excess of $1,000. Each ACCEL member's share of pooled losses is based on a risk-sharing formula which includes, but is not limited to, exposure and loss experience factors.In order to provide funds to pay claims, ACCEL collects a deposit from each member. The deposits are credited with investmnent income at the rate earned on ACCEUs investments.
At June 30, 2007, ACCEUs cash and investments totaled $26.450, of which $4,576 consists of deposits provided by the City. The City has no specific equity interest in ACCEL. Deposits provided to ACCEL by the City are expensed when paid by the General Benefits and Insurance Fund.ACCEL is responsible for deciding the risks it will underwrite, monitoring the handling of large claims, and arranging financial programs.
ACCEL does not have any debt outstanding.
For a copy of ACCEL's separate financial statements, contact the Finance Director of the City.NOTE 7 -SHORT-TERM NOTE PAYABLE: On January 12, 2007 the Redevelopment Agency entered into an agreement to purchase property and improvements located at 700 South Street. The purchase was financed through a short-term note of $2,759 with simple interest of 5% payable on or before July 12, 2007. The entire balance of the note was outstanding at June 30, 2007. The short-tenn note and associated interest payable are reflected in both the governmental funds financial statements as a current liability as well as on the government-wide financial statements.
NOTE 8 -LONG-TERM LIABILITIES:
The following is a summary of changes in long-term liabilities reported in the government-wide financial statements for the year ended June 30, 2007: Beginning Additions/
Reductions/
Balance Proceeds Paymenrts Ending Within Balance One 1Year Governmental activities:
Bonds Payable: General obligation City lease revenue Redevelopment Agency Accretion Untamortized bond discount Total COPs: City COPs Motorized Equipment COPs Unattortized COP discount'tolal Capital lease obligations:
City Redevelopment Agency Housing Autlority Itternal Service Funds Total Notes and loans payable: City Redevelopment Agency.Housing Authority Total Self-insurance (note 6)Retired medical (note 10)Governmental activities total Business-type activities:
Bonds payable: Electric Utility Water Utility Sanitation Convention.
Sports and Entertainment Venues Unantortized bond premium, net Total COPs: Electric Utility Convention, Sports and Entertainment Venues Accretion Unamnorlized COP discoumt Total Capital lease obligations:
Electric Utility Water Utility Sanitatiotn Golf Courses Convention, Sports and Entertainment Venues Total Notes and loans payable: Water Utility -Unantortized note discount Total Decommissioning provision Business-type activities total Government-wide total$ 6,170 502,477 156,117 76,195 740.959 28,446 1.622 30,066 1,997 31 48 144 2,220 14.921 26,159 2.251 43 331 30,828 67,524 914,928$256,320 10,873 (6,262)26) 931 1,641 6 2 47 I 696 18.000 238 18.238 6 137 12 671 299 673 S (470)(253.589)(3,982)(3,742)(261,7831 13,040)(240)2 (3.2781 (1,286)(16)(24)(106)(1.432)(1.590)(2,365)(3,95 5)(6,0681 (6,872)(283,388)(62.845)(1.324)$ 5,700 505,208 152,135 83,326 (6,262)740.107 25,406 1,382 26.788 2,352 21 26 85 2 484 13,331 41.794 2.489 57,614 30 897 73 323 931.213 480,230 206,035 10,1154 47,710 23,015 575 513 874 21,110 100,723 3,869 125 088 166 68 17 2 21 274 15,401 14,976 97,193 751,405$1,666,333 (75)(207 2.958 253,538 61.286)(21,110)(6,144)(1.891)532 (28,613)77 (94)33 (39)4 (8)(t)40 (19)154 (161 (945)50 (895)6,251 -259943 (90,955$559_616 $(374,343) 623,420 8.730 47,710 22,940 3.326 706.126 94,579 1,978 (82)96,475 149 62 13 1 42 267 14,456 (375)14081 103.444 920 393$1 851 606$ 480 5,320 7,790 3,204 251 3,455 1,140 17 13 35 1,205 1,660 7,289 8.949 8.278 7 787 43.264 14,690 1,375 80 16,145 6,327 1.978 8 305 78 32 7 18 136 941 941 25 527 S68 791 See note 12 for discussion of decommissioning provision.
50 CITY OF ANAHEIM GOVERNMENTAL ACTIVITIES:
BONDS PAYABLE At June 30, 2007, bonds payable consisted of the following:
Range of Authorized Out-Date Final Interest Rates and standing Issued Maturity at Issue Date Issued 6/30/07 City 1993 General Obligation Refunding Bonds 11/01/93 10/01/16 4.0%-7.0%1997 Anaheim Lease Revenue Bonds 2/01/97 3/01/37 4.5%-6.9%Accretion 2007 Anaheim Lease Revenue Refunding Bonds 6/01/07 3/01/37 4.1%-5.5%Total Unamortized bond discount Total City bonds Redevelopment Agency 1992 Project Alpha Tax Allocation Bonds 2/01/02 12/28/18 4.0%-6.45%
1997 Project Alpha TFax Allocation Bonds, Series A 6/01/97 2/01/18 4.4%-5.3%2000 Project Alpha Tax Allocation Bonds, Series A & B 12/01/00 2/01/18 4.1%-7.7%Total Redevelopment Agency bonds Total governmental activities bonds transient occupancy taxes (TOT) (i.e. 20% of the total transient occupancy taxes) for all hotel properties in the City, excluding Disney properties, and 2) 100% of the incremental TOT, sales, and property tax revenues from all Disney properties over the 1995 base, adjusted each year by the CPI change, with a minimum 2% increase annually.
The City is not required to pay any additional sums should the LPMR fall short of the amount required to pay debt service on the bonds. The Walt Disney Company provided a guarantee to the bond insurer to enable the issuer to obtain municipal bond insurance, resulting in the bonds receiving an AAA rating from S&P and an Aaa rating from Moody's.LPMR began on January 1, 2001, with the first payment made to the trustee on July 7, 2001, for the LPMR generated during the period January through June 2001. Subsequent to that date, LPMR is collected and remitted to the trustee monthly. During the fiscal year ended June 30, 2007, $33,026 was remitted to the trustee.Debt service requirements to maturity for the 1993 General Obligation Refunding Bonds, the 1997 Anaheim Lease Revenue Bonds, and the 2007 Anaheim Lease Revenue Refunding Bonds to be paid by the Municipal Improvements Debt Service Fund from future property tax revenues and by the Anaheim Resort Inprovements Debt Service Fund from futture LPMR, respectively, are as follows:$ 10,055 510,427$ 5,700 248,888 83,326 256,320 256,320 594,234 (6,262)587,972 Fiscal Year Ending 6/30 134,433 10t4,0t00 2008 2009 2010 27,905 18,640 2011 2012 2013-2017 31,850 29,495 2 018- 202 2 1.52,135 2023-2027$970,990 $740),107 2028-2032 2033-2037 Total Unamortized bond discount Total bonds Principal$ 5,800 6,735 7,835 9,325 13,545 96,470 63,405 77,768 92,953 137,072 510,908 (6,262)$54,46 Interest$ 17,356 20,387 19,956 19,448 19,781 79,21)0 138,8610 156,619 177,563 214,282 863,452$863,452 Total$ 23,156 27,122 27,791 28,773 33,326 175,670 2102,265 234,387 270,516 351,354 1,374,360 (6,262)$1,368,098 Bonds Payable -City Lease payment measurement revenues In February 1997, the Anaheim Public Financing Authority sold $510,427 of lease revenue bonds to construct public improvements in The Anaheim Resort. In JAme 2007, the Authority sold $256,320 of lease revenue bonds to defease $248,335 of the 1997 lease revenue bonds. The bonds are special obligations of the Authority payable solely from lease payments to be made by the City to the Authority for the use and occupancy of the leased premises.
Debt service requirements to maturity for these lease revenue bonds are paid from lease payment measurement revenues (LPMR) defined as: 1) 3% of the 15%Included in interest is $83,326 related to accretion on capital appreciation bonds.Bonds Payable -Redevelopment Agency Debt service requirements to maturity for the Redevelopment Agency Tax Allocation bonds are to be paid by the Redevelopment Agency Debt Service Fund from ftture tax increment revenue are as follows: 51 CITY OF ANAHEIM Fiscal Year Ending 6/30 2008 2009 2010 2011 2012 2013-2017 2018-2019 Total bonds Principal$ 7.790 8,260 10,685 11,355 12.060 72.675 29,310$152,135 Interest$ 9,409 9,373 8,365 7,684 6,960 22,105 1,882$65,778 Total$ 17,199 17,633 19,050 19,039 19,020 94,780 31,192$217,913 Fiscal Year Ending 6/30 2008 2009 2010 2011 2012 Total COPs CAPITAL LEASE OBLIGATIONS Principal$ 251 261 273 290 307$1,382 Interest$ 72 58 42 26 8 f2_06 Total$ 323 319 315 316 315$1,588 CERTIFICATES OF PARTICIPATION At June 30, 2007, certificates of participation consisted of the following:
Date Final Issued Maturity Range of Interest Rates at Issue Date Authorized and Issued Out-standing 6/30/07 The City has a long-term noncancelable lease with Motorola, Inc. to finance the acquisition of certain software utilized by the City's Police Department.
The lease qualifies as a capital lease for accounting purposes as defined under the FASB Statement No. 13, AccountingJbr Leases, and therefore has been recorded at the present value of future mininmum lease payments at the date of inception of the lease. Future minimum lease payments to be made from unrestricted revenues of the General Fund under the capital lease ate as follows: City 1993 Refunding Projects 1993 Police Facilities Refinancing Project 1993 Arena Land Refinancing Total City 1/14/93 8/01/19 5.47%7/15/93 8/01/08 4.47%11/01/93 11/01/19 6.0%-7.50%
$ 9,696 $ 5,631 26,000 4,400 Fiscal Year Ending 6/30 21)08 21,210 15,375 2009 25.406 2010 Motorized Equipment 1993 Refunding Projects 1/14/93 8/01/11 5.47%Total governmental activities COPs Total Less amount representing interest, variable Present value of future minimum lease payments$296 296 247 839 (60)S779 4,584 1,382$61,490 $26,788 Certificates of Participation Payable -City Certificates of participation debt service payments are to be paid from unrestricted revenues of the Certificates of Participation Debt Service Fund. COP debt service requiremtents to maturity are as follows: The City also has a long-term noncancelable agreement with HP Financial Services to finance the acquisition of the City's server, desktop, and portable computer equipment.
The agreement qualifies as a capital lease for accounting purposes as defined under the FASB Statement No. 13, Accounting./br Leases, and therefore has been recorded at the present value of future minimumn lease payments at the date of inception of the lease.Future minimum lease payments to be made front unrestricted revenues of the City under the capital lease are as follows: Fiscal Year Ending 6/30 2008 2009 2010 2011 2012 2013-2017 2018-2020 Total COPs Principal$ 3,204 3,388 1,208 1,303 1,390 8,447 6,466$25,406 Interest$1,445 1,272 1,149 1,070 985 3,439 630$9,990 Total$ 4,649 4,660 2,357 2,373 2,375 11,886 7,096$35,396 Fiscal Year Ending 6/30 2008 2009 2010 Total Less amount representing interest, variable Present value of future minimum lease payments (1overninental Activities
$ 973 720 77 1,770 (65)$1,705 Business-type Activities
$143 97 40 280 (13)$267 Total City$1,116 817 117 2,050 (78)$1,972 Certificates of Participation Payable -Motorized Equipment Debt service requirements to maturity for Motorized Equipment certificates of participation to be paid by the Motorized Equipment Internal Service Fund from future revenues are as follows: 52 CITY OF ANAHEIM NOTES AND LOANS PAYABLE At June 30, 2007, notes and loans payable are as follows: Notes and Loans Payable -City Homer Street land acquisition In July 1995, the Redevelopment Agency executed an installment note secured by a deed of trust with the County for acquisition of at 1133 Homer Street and 1170 Anaheim Boulevard.
The amount of the note is $500 and bears interest at 7.25% per annum for a term of 15 years. Based on a cooperative agreement between the Redevelopmeint Agency and the Community Services Department, principal and interest on the note will be paid by the Community Services Department.
At June 30, 2007, the outstanding balance on the note was $136. Note debt service requirements to maturity are as follows: Fiscal Year Ending 6/30 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2024 Total notes and loans Principal$ 169 175 272 355 397 2,661 3,948 1,705$9,682 Interest$ 513 508 499 486 469 1,995 1,097 94$5,661 Total$ 682 683 771 841 866 4,656 5,045 1,799$15,343 Computer-Aided Dispatch and Records Management System (CAD/RMS) loan payable In December 20)05, the City entered into an agreement with SunTrust to finance the acquisition and implementation of the CAD/RMS system. The amount of the loan is$5,289 and bears interest at 3.30% per annum for a term of 5 yeats. Principal and interest payments of $578 are due semiannually beginning on June 30, 2006 until December 3 1, 2009. The outstanding balance at June 30, 2007 was $2,753. Loan debt service requirements to maturity are as follows: Fiscal Year Ending 6/30 2008 2009 2010 Total notes and loans Principal$ 42 45 49$136 Interest Total$10 $ 52 7 52 3 52$20 $156 Fiscal Yea- Ending 6/30 2008 2009 2010 Total notes and loans Principal$1,074 1,110 569$2,753 Interest$ 82 46 9$137 Total$1,156 1,156 578$2,890 HUD Section 108 auaranteed loans Payable In May 1999, the City entered into an agreement with HUD, making available
$3,000 to finance the acquisition of certain property for park development.
The loan bears interest ranging from 6.56% to 7.22% and is payable over a nine-year period beginning on August 1, 2000 until August 1, 2008. The outstanding balance at June 30, 2007, was $760. Loan debt service requirements to maturity to be paid from the Community Development Block Grant Special Revenue Fund are as follows: Notes and Loans Payable -Redevelopment Agency Redevelopment Agency Savi Ranch Associates note payable Fiscal Year Ending 6/30 2008 2009 Total notes and loans Principal$375 385$760 Interest$41 14$55 Total$416 399$815 In May 2003, the City entered into an agreement with HUD, making available
$10,000 to provide financial assistance related to the development of Westgate on a former landfill site located at the northeast comer of Beach Boulevard and Lincoln Avenue. The loan is payable from sales tax revenue generated by Westgate, from Community Development Block Grant yearly entitlement, and from the Redevelopment Agency's property tax increment and project participation revenues generated by Westgate.
The outstanding balance at June 30, 2007 was $9,682. The loan bears interest ranging from 1.74% to 5.97% and is payable over 20 years beginning on February 1, 2005 until August 1, 2023.Loan debt service requirements to maturity are as follows: In July 1989, the Redevelopment Agency executed a note with Savi Ranch Associates, a California general partnership.
The amount of the note is $2,707 and bears interest at 9.5%per annum. The note is payable from net property tax increment as defined in the Redevelopment Agency note. If there is insufficient property tax increment to pay for principal and interest at the termination of the River Valley project area plan in November 2031, the note ceases to be an obligation of the Redevelopment Agency.Redevelopment Agency Orange County Transportation Authority note payable In August 2005,tthe Agency executed a purchase price promissory note with the Orange County Transportation Authority (OCTA) for $12,998 for the acquisition of certain sites and $1,059 for the repayment of the balance of the November 2004 OCTA (Stingray) note.The amount of the note is $14,057 and bears an adjustable interest rate equal to OCTA's short term portfolio yield for the 12 month period ending June 30 each year. The note is payable quarterly, commencing in October 2005 and matures in October 2011. At June 30, 2007, the outstanding balance of the note was $6,978.53 CITY OF ANAHEIM Redevelopment Agency Note Purchase Agreement
-Citigroup Global Markets Inc.On November 14, 2006, the Redevelopment Agency entered into a note purchase agreement with Citigroup Global Markets Inc. for a bridge loan of $18,000 to pay half of the purchase price of an approximately 18.3-acre industrial property at the northeast corner of Olive and South streets. The note bears an initial interest rate of 6.44% per annum and is adjustable monthly beginning on December 1, 2007 at a note rate defined in the note purchase agreement.
Interest is payable monthly and principal matures on November 14, 2008 or earlier, as provided in the note purchase agreement.
The outstanding balance of this note at June 30, 2007 was $18,000.Redevelopment Agency Williams note payable In January 2005, the Redevelopment Agency executed a promissory note with Robert and Betty Williams, co-trustees of the Williams Family Trust, for the acquisition of property for commercial development:
The amount of the note is $650 and bears 3.5% interest per annum. The note is payable over six years. At June 30, 2007, the outstanding balance of the note was $413.Redevelopment Agency contractual commitments As part of the Redevelopment Agency's economic development program to attract and retain businesses in the City, the Redevelopment Agency has entered into various contractual comumitments.
Generally, the Redevelopment Agency reimburses the business for its tenant improvement costs from property tax increment revenues received by the Redevelopment Agency. At June 30, 2007, the outstanding balance of these commitments totaled $392: California State Teachers Retirement System (CALSTRS) has entered into an agreement, dated December 15, 1992, with the Agency to share hi the development costs of the Plaza Redevelopment Project. In March 2004, CALSTRS assigned the agreement to the new owners, Pan Pacific Retail Properties, In. (PPRP).The PPRP participation note bears 7%simple interest rate and has a maximum term of 25 years. The Redevelopment Agency's obligation to repay the note is entirely contingent on the revenues generated by the project.The note will be forgiven at the end of the tenm whether or not the entire amount has been repaid. At June 30, 2007, the outstanding balance of the participation note was $4,615.The Redevelopment Agency entered into a purchase and sale agreement dated November 24, 2002 with Suzanna Luiso, a property owner, for the purchase of a future commercial development site located at 1687 West Lincoln Avenue for $900. One half of tile purchase price or $450 was paid in cash and the balance of $450 by a promissory note bearing 6%simple interest per annum. The note is payable over 10 years at $3 per month with a balloon payment of $379 on its maturity date of March 1, 2013. The outstanding balance of this note at June 30, 2007 was $424.In March 2006, the Redevelopment Agency entered into a business loan agreement with Pacific Western Bank for the acquisition of an affordable housing site at 2748 West Lincoln Avenue. The amount of the note is $3,500 and bears 6.625% interest per annum.The note is payable over two years at $23 per month with a balloon payment of $3,438 on its maturity date in March 2008. The outstanding balance of this note at June 30, 2007 was$3,465.In June 2006, the Redevelopment Agency entered into a business loan agreement with Pacific Western Bank for the acquisition of an affordable housing site at 1287 East Lincoln Avenue. The amount of the note is $4,800 and bears 7.375% interest per annum. Interest on the note is payable monthly and the entire note balance is payable on its maturity in July 2007. The outstanding balance of this note at June 30, 2007 was $4,800.Debt service requirements to maturity for the Redevelopment Agency notes payable and contractual commitments to be paid from future revenues are as follows: Fiscal Year Ending 6/30 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2027 2028-2032 Total notes and contractual commitnents Principal$ 7,289 23,978 2,516 887 309 2,328 1,780 2,707$41,794 Interest$ 3,081 1,450 725 573 551 2,503 1,904 1,910$ý14 911 Total$10,370 25,428 3,241 1,460 860 4,831 3,684 1,910 S56,705 Notes and Loans Payable -Ilouising Authority Housing Authority CHFA loan agreements In October 2003, the Housing Authority entered into a loan agreement for an amount up to $1,800 with the California Housing Finance Agency (CHFA), to provide funding for first-time homebuyers down payment assistance.
The note bears 3% simple interest, with principal and interest due in October 2013. At June 30, 2007, the outstanding balance of this loan was $839.In November 1999 and April 2000, the Housing Authority entered into separate loan agreements totaling $1.650 with CHFA to provide funding to several property owners for the rehabilitation of properties to provide affordable housing. The notes bear 3% simple interest, with principal payments in the amount of $1,150 and $500 due in November 2009 and April 2010, respectively.
54 CITY OF ANAHEIM BUSINESS-TYPE ACTIVITIES:
BONDS PAYABLE Bonds Payable -Water Utility Bond debt service requirements to maturity for the Water Utility-to be paid from revenues are as follows: Date Final Issued Maturity Electric Utility 1993 Revenue Bonds 1998 Revenue Bonds 1999 Revenue Bonds 2002 Revenue Bonds 2003 Revenue Bonds 2004 Revenue Bonds 2007 Revenue Bonds Total Unamortized bond premium Total Electric Utility Water Utilitv 2004 Revenue Bonds Unamortized bond discount Total Water Utility Sanitation 21007 Revenue Bonds Unamortized bond premium Total Sanitation 6/01/93 5/01/98 9/01/99 2/15/02 4/01/03 6/01/04 2/01/07 10/01/07 10/01/28 10/01/27 10/01/31 10/01/22 10/01/34 10/01/39 Range of Interest Rates at Issue Date 3.5%-5.1%4.75%-5.0%
3.0%-5.0%3.3%-5.25%
3.0%-5.0%3.0%-5.0%4.0%-5.0%Authorized Out-and standing Issued 6/30/07$ 60,700 65,000 45,000 178,705 60,415 131,265 206,035$ 6,615 8.035 41,8105 178,705 55,990 126,235 206,035 623,420 2,270 625.690 Fiscal Year Ending 6/30 200)8 2009 2010 2011 2012 2013-2017 Total Unamortized bond discount Total bonds Principal$1,375 1,435 1,490 880 915 2,635 8,730 (300)$8,430 Interest "Total$ 325 $ 1,700 269 1,704 210 1,7010 163 1,043 127 1,042'200 2,835 1,294 10,024 (30)0)$1,294 $ 9,724 5/01/04 10/01/16 4.0%-4.5%5/23/07 2/01/39 3.55%-5.0%
12,105 8,730 (300)8,430 47,710 47,710 1,515 49,225 26,26(0 22,940 (159)22,781 S$8 3 3,195 $706,126 Bonds Payable -Sanitation Bond debt service requirements to maturity for Sanitation to be paid from revenues are as follows: Convention, Sports and Entertainment Venues 2002 Revenue Bonds 7/02/02 8/01/23 Uniamortized bond discount 3.0%-5.5%Total Convention, Sports and Entertainment Venues Total busiriess-type activities bonds Bonds Payable -Electric Utility Fiscal Year Ending 6/30 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2027 21128-2032 2033-2037 2038-2039 Total Unatnortized bond premiumbonds Principal$ 775 805 835 4,805 5,985 7,560 9,445 11,910 5,590 47,710 1,515$49,225 Interest$ 1,532 2,224 2,223 2.192 2,160 10,188 8,998 7,424 5,544 3,078 401 45,964$45,964 Total$ 1,532 2,224 2,998 2,997 2,995 14,993 14,983 14,984 14,989 14,988 5,991 93,674 1,515ý$94189 Bond debt setvice requirements to revenues are as follows: Fiscal Year Ending 6/30 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2027 2028-2032 2033-2037 2038-2039 Total Unamortized bond premiutn Total bonds maturity for the Electric Utility to be paid fiom Principal$ 14,690 15,370 15,995 16,725 17,040 97,510 101,365 108,630 138,445 81,935 15,715 623.420 2,270$625,690 Interest$ 29,450 28,798 28,123 27,379 26,607 120,364 94,981 69,623 39,695 12,560 354 477.934$477.934 Total$ 44,140 44,168 44,118 44,104 43,647 217,874 196,346 178,253 178,140 94,495 16,069 1,101,354 2,270$1,103,624 55 CITY OF ANA14EIM Bonds Payable -Convention, Sports and Entertainment Venues Bond debt service requirements to maturity for the Convention, Sports and Entertainment Venues to be paid fron revenues are as follows: Fiscal Year Ending 6/30 2008 2009 2010 2011 2012.2013-2017 2018-2022 2023-2024 Total Unamortized bond discount Total bonds Principal$ 80 3,215 3,340 3,505 3,520 8,885 305 90 22,940 (159)$22_781 Interest$1,129 1,071 944 777 583 627 69 2 5,20)2 Total$ 1,209 4,286 4,284 4,282 4,103 9,512 374 92 28,142 (159)$27,983 Out-standing 6/30/07 Included in interest is $1,978 related to accretion on capital appreciation certificates.
NOTES AND LOANS PAYABLE Notes and Loans Payable -Water Utility At June 30, 2007, notes and loans payable are as follows: Orange County Water District promissory note In April 1990, the Water Utility executed a Well Construction Program Agreement with the Orange County Water District to assist in financing the construction of three super wells to be located within the City. Advances totaling $2,177 at an interest rate of 3.5% for a period of 15 years were for wells 46, 47 and 49. The outstanding balance on this note at June 30, 2007, totaled $408.State of California Revolving Fund note pavable CERTIFICATES OF PARTICIPATION Date Final Issued Maturity Convention, Sports and Entertainment Venues 1992 Convention Center Financing Project 1/01/92 8/01/23 Accretion 1993 Reftmding Projects 1/14/93 8/01/19 Unamortized COP discount Total business-type activities COPs Range of Interest Rates at Issue Date Authorized and Issued In June 2001, the Water Utility executed a note payable to the State of California Revolving Fund at a rate of 2.8% in the amount of $18,063. There are semi-annual payments of principal and interest in the amount of $592 through June 12, 2021. The outstanding balance on this note at June 30, 2007, totaled $14,048.Notes and loans debt service requirements to maturity for the Water Utility are as follows: 3.9%-6.4% $ 92,777 $39,192 1,978 5.47% 114,564 55,387 (82)$207,341 $96,475 Certificates of Participation Payable -Convention, Sports and Entertainment Venies Certificates of participation debt service requirements to maturity for the Convention.
Sports and Entertainment Venues Fund to be paid from unrestricted revenues are as follows: Fiscal Year Ending 6/30 2008 2009 2010 2011 2012 2013-2017 2018-2021 Total Unamortized note'discount Total notes and loans Principal$ 941 935 963 899 892 4,849 4,977 14,456 (375)$14,081 Interest$ 400 373 346 318 293 1,076 354 3,160$3,160 Total$ 1,341 1,308 1,309 1,217 1,185 5,925 5,331 17,616 (375)$17,241 Fiscal Year Ending 6/30 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2024 Total Unamortized COP discount Total COPs Principal$ 6,327 5,396 5.669 6,027 6.388 32,013 30.759 2,000 94,579 (82)$94,497 Interest$ 7.378 5,096 4.774 4,435 4.076 15,319 3.877 75 45,030$45,030 Total$ 13,705 10M492 10,443 10,462 10,464 47,332 34,636 2,075 139,609 (82)$139,527 ARBITRAGE The Tax Reform Act of 1986 (Act) substantially revised the treatment to be afforded to earnings on the proceeds of tax-exempt debt, and now requires the City to calculate and remit rebatable arbitrage earnings to the Internal Revenue Service. Certain of the City's debt and interest earned on the proceeds thereof are subject to the requirements of the Act.The City has accrued a liability for estimated rebatable arbitrage earnings and has set aside such earnings as restricted cash. At June 30, 2007, the arbitrage rebate liability for governmental and business-type activities was zero and $215, respectively.
56 CITY OF ANAHEIM COMPLIANCE WITH DEBT COVENANTS CONDUIT FINANCINGS There are various limitations and restrictions contained in the City's bond and certificates of participation indentures.
The City believes they are in compliance with all significant limitations and restrictions.
DEBT ISSUANCES City -Debt Refunding In June of 2007, the Authority sold $256,320 of lease revenue bonds, of which $255,325 was deposited in escrow funds to advance refund and defease $248,335 of the 1997 Anaheim Lease Revenue Bonds. The City reduced its total debt service payments over the life of the bonds by $19,957, and obtained an economic gain (difference between net present value of the debt service payments onl the old debt and new debt) of $10,456.Electric Utility -Debt Refunding In February of 2007, the Electric Utility sold $209,453 of revenue bonds, of which$73,467 was deposited in escrow funds to advance refund and defease $2,1 10 in Electric System Certificates of Participation and to advance refund and partially defease $49,625 of Anaheim Public Financing Authority 1998 revenue bonds. The Electric Utility reduced its total debt service payments over the life of the bonds by $9,236, and obtained an economic gain of $4,315.Debt Defeased Certain bonds and certificates of participation defeased by the City prior to June 30, 2007, are summarized below: City The City has entered into two conduit financings on behalf of community care provider facilities and one to facilitate the management agreement for the Honda Center (formerly the Arrowhead Pond) of Anaheim. In accordance with applicable agreements, the Cityhas no obligation for debt service payments and therefore, the debt is not reflected in the accompanying basic financial statements.
Bonds payable and certificates of participation related to conduit financings outstanding at June 30, 2007, are as follows: Date Issued 1985 West Anaheim Convalescent Home 12/30/85 1993 Anaheim Memorial Hospital Association 10/15/93 2003 Anaheim Arena Financing Project 12/11/03 Total Final Amount Outstanding Maturity Issued 6/30/07 12/01/05 $ 3,204 $ 1,959 5/15/20 46,690t 6/01/23 42,600$92,494 30/,920t 39,500$72,379 Anaheim Housing Authority The Anaheim Housing Authority has entered into conduit debt financings on behalf of various developers to assist with the acquisition, construction, equipping, rehabilitation and refinancing of multifamily residential rental projects within the City of Anaheim. In accordance with the bond documents, neither the City nor the Housing Authority has an obligation for debt service payments and therefore, the debt is not reflected in the accompanying basic financial statements.
Housing Authority revenue bonds related to conduit financings outstanding at June 30, 2007, are as follows: Outstanding 6/30/07 City 1997 Anaheim Lease Revenue Bonds $248,335 1985 West Anaheim Royale 1990 Bel Age Apartments Redevelopment Agency -1992 Heritage Village Park Local Government Finance Authority Revenue Bonds, 1986 Issue A 38,410 1997 Monterey Apartments Electric Utilit 1997 Port Trinidad Apartments El i U1997 Casa Granada Apartments Electric System Certificates of Participation, Issue of 1997 3,240 1998 Sage Park Project Electric System Revenue Bonds, Issue of 1998 49,625 2000 Cobblestone Apartments 2000 Seawinds Apartments In each of these refundings, the proceeds of the refunding issues were placed int 2000 Paris Apartments 2000 Park Vista Apartments irrevocable escrow accounts and invested in governlnent securities that, together with 2001 Solara Court Apartments interest earnings thereon, will provide amounts sufficient for future payments of interest Total and principal on the issues refunded.
Refunded debt is not included in the City's accompanying basic financial statements as the City has satisfied its obligation through the in-substance defeasance of these issues.Date Final Issued Maturity 12/01/85 12/(01/15 8/01//90 8/01/20 11/12/92 11/12/07 5/15/97 5/15/27 5/15/97 5/15/27 5/15/97 5/15/27 11/01/98 11/01/28 7/20/00 3/15/33 7/20/00 7/15/33 7/24/00 / 7/01/33 1/01/01 12/01/34 Amlount Issued$ 4,664 101001)8,485 4,545 2,140 3,795 5,500 3,980 7,000 27,180 8,200$85,489 Outstanding 6/30/07$ 3,079 6,600 5,485 4,045 1,940 3,395 5,500 3,780 6,700 27,180 6,110$73,814 57 CITY OF ANAHEIM Mello-Roos Community Facilities Districts Iln February 2007, the City issued $9,060 in special tax bonds to finance a portion of the cost of acquisition and construction of facilities in the Platinum Triangle of Anaheim. The bonds were authorized pursuant to the Mello-Roos Community Facilities Act of 1982. The bonds are payable from a special assessment tax and are non-recourse bonds secured by the properties.
Neither the faith and credit nor the taxing power of the City, the State of California or any political subdivision of either of the foregoing is pledged to the payment of the bonds. The bonds are not general or special obligations of the City, nor do they contain any credit enhancements that secondarily pledge existing or future resources of the City, accordingly they are not reflected in the accompanying basic financial statements.
The City is acting as agent only for the property owners in collecting the special assessments and forwarding the collections to the fiscal agent. This activity is recorded in an agency fund in the basic financial statements.
At June 30, 2007, the 2007 Mello-Roos bonds outstanding amounted to $9,060.In June 1989, the City issued $26,620 in special tax bonds to finance a portion of the cost of acqtuisition and construction of facilities in East Anaheiml Hills. The bonds were authorized pursuant to the Mello-Roos Colmmunity Facilities Act of 1982. In April 1995,$15,389 of the 1989 bonds were advance refunded through the Anaheim Public Financing Authority and in June 2005, $11,160 of the 1995 bonds were refunded through the Authority.
In December 1999, $7,720 of the 1989 bonds were refunded by the City. The 2005 and the .1999 bonds are payable from a special assessment tax and are non-recourse bonds secured by the properties.
Neither the faith and credit nor the taxing power of the City, the State of California or any political subdivision of either of the foregoing is pledged to the payment of the bonds. The bonds are not general or special obligations of the City, nor do they contain any credit enhancements that secondarily pledge existing or future resources of the City, accordingly they are not reflected in the accompanying basic financial statements.
The City is acting as agent only for the property owners in collecting the special assessments and forwarding the collections to the fiscal agent. This activity is recorded in an agency fund in the basic financial statements.
At June 30, 2007, the 2004 Anaheim Public Financing Authority bonds outstanding amounted to $9,375, and the 1999 Mello-Roos bonds outstanding anmounted to $5,530.NOTE 9 -SEGMENT INFORMATION:
The Sanitation Fund issued revenue bonds to finance sewer system expansion and improvements.
The Sanitation Fund accounts for three activities:
solid waste collection, waste water, and street cleaning.
However, investors in the revenue bonds rely solely on revenue generated through waste water activities for repayment.-
Summary financial infornation for waste water activities is presented below: Condensed Statement of Net Assets Assets Current assets Restricted assets Capital assets Total assets Liabilities Current liabilities Current liabilities payable from restricted assets Noncurrent liabilities Total liabilities Net Assets Invested in capital assets, net of related debt Unrestricted Total net assets Condensed Statement of Revenues, Expenses and Changes in Net Assets Wastewater fees (pledged against bonds)Depreciation and amortization Other operating expenses Total operating income Nonoperating income (expenses)
Interest income Other nonoperating income Interest expense Transfers out Capital contributions Total nonoperating income Change in net assets Net assets at beginning of year* Net assets at end of year Condensed Statement of Cash Flows Net cash provided by (used in): Operating activities Noncapital financing activities Capital and related financing activities Investing activities Net increase Beginning cash and cash equivalents Ending cash and cash equivalents
$ 9,936 49,469 52,_600 112,005 606 550 49,225 50,381 51,578 10,046$ 6_ .624$ 10,113 (1,102)(6,734)2.277 380 59 (192)(269)51,425 51,403 53,680 7.944$ 61,624$ 3,207 (210)46,633 (45,742)3,888 353$ 4,241 58 CITY OF ANAHEIM NOTE 10 -INTEREST RATE SWAPS: Objective of the interest rate swaps. As a means to lower its borrowing costs, when compared against fixed-rate bonds at the time of issuance, the City entered into interest rate swap agreements for certain COPs. The intention of the swaps was to effectively change the City's variable interest rate on the COPs to a synthetic fixed rate.Terms and fair values. The teris and fair values of the outstanding swaps at June 30, 2007, were as follows. The City's swap agreements contain scheduled reductions to outstanding notional amounts that are expected to approximately follow scheduled oi" anticipated reductions in the associated COPs payable.Notional COP Issues Amotunts 1993 Refunding Projects $62,400 1993 Police Facilities Refinancing Project 4,400$66,800 Variable Effective Fixed Rate Rate Date Paid Received 1/1/1993 5.47% 3.35%t 6/1/1993 4.47% 3.35%t Swap Fair Termiination Values Date-$(5,960) 8/1/2019 (47) 8/1/2008$(6,007)Moody's at June 30, 2007. To mitigate the potential for credit risk, if the counterparty's credit quality falls below AA-/Aa3, the fair value of the swaps will be fully collateralized by the cotmterparty with cash or securities.
Collateral would be posted with a third-party custodian.
Termination Risk. The City or the counterparty may terminate the swaps if the other party fails io perform under the terms of the contracts.
The swaps may be terminated by the City if the counterparty's credit quality rating falls below "A-" as issued by S&P or "A3" as issued by Moody's. Additionally, the swaps may be terminated by the counterparty if the City's credit quality rating falls below "BBB-" as issued by S&P or "Baa" as issued by Moody's or if the COPs' credit quality ratings fall below "AA-" as issued by S&P or "Aa3" as issued by Moody's. If the swaps are terminated, the variable-rate COPs would no longer carry synthetic interest rates. Also, if at the time of termination the swaps had negative fair values, the City would be liable to the counterparty for a payment equal to the swaps'fair values.NOTE 11 -RETIREMENT PLANS: PERS The City contributes to the California Public Ensployees' Retiretnent System (PERS), an agent multiple-employer public employee defined benefit pension plan. PERS provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries.
PERS acts as a common investment and administrative agent for participating public entities within the State ofCalifornia.
Benefit provisions and all other requirements are established by State statute and City ordinance.
A copy of PERS' annual financial report may be obtained from its executive office at 400 P Street, Sacramento, California 95814.Funding Policy: Participants are required to contribute 8.0% (9.0% for fire safety employees and 11.5% for police safety employees) of their annual covered salary. For miscellaneous employees the City pays 7% of the participant contributions and the employee pays 1%. For Police safety employees 9% of the 11.5% is paid by the City and the employee pays the remaining 2.5%. For Fire safety employees, the entire 9% is paid by the employees.
In addition, the City is required to contribute at an actuarially determined rate applied to annual covered payroll; the current rates are 15.793% for miscellaneous employees, 23.823% for fire safety employees and 24.(169% for police safety employees.
The contribution requirements of plan members and the City are established and may be amended by PERS.tVariable rate received effective at June 30, 2007. The variable rate received is a weekly interest rate detenmined by the-remarketing agent on the deternmination date to be the minimum interest rate, which, in the opinion of the remarketing agent under then-existing nmarket conditions, would enable the remarketing agent to sell such COPs.Fair Value. Because interest rates have declined since execution of the swaps, the swaps had a negative fair value of $6,007 at June 30, 2007. The swaps' negative fair value may be countered by a reduction in total interest payments required under the variable-rate COPs, creating a lower synthetic interest rate. Because the coupons on the City's variable-rate COPs adjust to changing interest r:ates, the COPs do not have a corresponding fair value increase.
The fair values were estimated using the present value of expected cash flows. The fair value of the swaps are not recorded in the accompanying financial statements.
Credit Risk. At June 30, 2007, the City was not exposed to credit risk because the swaps had negative fair values. However, should interest rates change and the fair values of the swaps become positive, the City would be exposed to credit risk in the amount of the derivatives' fair values. The swap counterparty was rated AA+ by S&P and Aal by 59 CITY OF ANAHEIM Annual Pension Cost: For fiscal year 2007, the City's. annual pension cost of $48,023 for PERS was equal to the City's required and actual contributions.
The required contribution was determined as a part of the 2006 actuarial valuations, using the entry age normal actuarial cost method. The actuarial assumptions included: (a) 7.75% investment rate of return (net of administrative expenses), (b) projected annual salary increases that vary by duration of service, and (c) 2% per year cost-of-living adjustments.
Both (a) and (b)included an inflation component of 3%. The actuarial value of PERS assets was determined using techniques that smooth the effects of short-term volatility in the market value of investments over a 15-year period (smoothed market value). The PERS unfunded actuarial accrued liability is being amortized as a level percentage of projected payroll on a closed basis. The average remaining amortization periods at June 30, 2006, were 22 years for the miscellaneous plan and 32 years for safety fire and police plans for years of service unfunded.
See Required Supplementary Information immediately following the notes to the financial statements.
Trend information for PERS The most recent actuarial valuation was as of July 1, 2006, using the Projected Unit Credit cost method to determine reserving requirements.
The valuation was based on the following assumptions:
Discount rate Increase in future payroll Medical trend Non-econolnic 4.5% annual 4.0% annual 11.0% increase in 2007, declining to 5.0%increase by 2013 System-wide PERS assumptions based on pension formula of the employee group Fiscal Year-Ending 6/30/05 6/30/06 6/30/07 Annual Pension Cost (APC)$29,591 42,734 48,023 Percentage of APC Contributed 100%100 100 Net Pension Obligation
$0 0 0 Retirement Medical Benefits In addition to the pension benefits described above, the City provides postretirement medical benefits to eligible retirees (hired prior to January 1, 1996, Anaheim Police Association employees hired prior to July 6, 2001, and Anaheim Fire Association employees hired prior to November 9, 2001) in accordance with City Personnel Resolutions and various Memoranda of Understanding.
Depending upon the employee's date of hire and employee group, minimum eligibility requirements are age 50 and 5 years of City service.The City has several plans with different contribution levels and benefit provisions.
City contributions vary up to 100% of annual premium cost, depending on the employee's Medicare eligibility, year of hire, age and employee group.The City's contributions toward the cost of these defined benefits are generally advance funded on an actuarial basis to a dedicated reserve but contributions are not required.
For the period July 1, 2006 to June 30, 2007, the City's contribution to the postretirement medical plan was $12,671.The July 1, 2006, actuarial valuation estimated the current normal cost of the benefit at 1.74% of payroll. An additional 3.20% of payroll was estimated as the cost of amortizing prior service obligations over a 30-year period as a level percentage of total payroll.Currently, the accrued liability is estimated at $198,385 of which $125,062 is unfunded and $73,323 is funded, available, and reserved for future obligations.
Changes were made to the postreiirement medical benefits for members of IBEW bargaining unit. Those members of the IBEW that retired on or before October 15, 2005 may be eligible for the City's defined benefit postretirement medical benefits.
Members of the IBEW retiring after that date are eligible for benefits from a trust established by the IBEW. Benefits are determined by the trustees of the IBEW Trust. The City's liability is liutited to atn annual contribution equal to a specified percentage of pay less the annual cost of funding retirees before October i5, 2005. The specified percentage is four percent initially and will go to five percent on December 26, 2008. In October 2005, the City transferred a portion of the reserve earmarked for providing retiree medical benefits to IBEW employees to tile IBEW Trust such that the actuarial liability of retirees as of October 15, 2005 and futtre retirees were similarly funded. Such determination was based on the actuarial assumptions and methods reflected in the July 1, 2004 valuation and participant data as of October 15, 2005. For the period July 1, 2006 to June 30, 2007, the City's contribution to the IBEW trust was $207.Miscellaneous employees hired on or aller January 1, 1996 and before January 1, 2002 (not represented by the Anaheim Police Association, the Anaheimi Fire Association or the International Brotherhood of Electrical Workers) were transitioned from the defined benefit post retirement medical plan to the defined contribution post relirement medical plan. A one-time contribution of $.07 per month of service was made to a newly established retiree health savings account for those eligible employees on or about December 31, 2005. Total contributions to participant accounts under this provision were$1,685. Participation in the retiree health savings account is mandatory for that group of employees and requires an employee contribution of 2% of their regular earnings at June 30, 2007.60 CITY OF ANAHEIM The City provides postretirement medical benefits in the form of contributions to defined contribution retiree medical plans in accordance with City Personnel Resolutions and various Memoranda of Understandings for all newly hired employees as of January 1, 1996 (July 6, 2001 for the Anaheim Police Association and November 9, 2001 for the Anaheim Fire Association employees).
Under the plans, the City is required to make one-time contributions ranging from $3 to $8 per employee.
The City's total contribution to the plans for the period July 1, 2006 to June 30, 2007, was $678. All active employees (including those eligible for the defined benefit retiree medical plan) are eligible to participate in the plan through voluntary contributions of the value of sick or vacation hours up to certain limits, into their retiree health savings accounts.
These accounts are available to reimburse costs incurred after retirement for medical and other welfare benefits.In all cases, eligible retirees may participate in any health plan made availableto active City employees.
The contribution made by the City toward the cost of the plan is determined by Personnel Resolution or Memorandwn of Understanding.
At June 30, 2007, 1,167 retirees or surviving spouses met the various eligibility requirements and were receiving benefits.NOTE 12 -JOINT VENTURES AND JOINTLY-OWNED PROPERTIES:
Authority for Orange County -City Hazardous Materials Emergency Response The City participates in a joint powers authority, the Authority for Orange County-City Hazardous Materials Emergency Response (Hazmat), for the purposes of responding to, assessing the nature of, and stabilizing any emergency created by the release or threatened release of hazardous materials.
The following entities are members of Hazmat: City of Anaheim, Orange Counity Fire Authority, City of Santa Ana, and the City of Huntington Beach. Members of the Board of Directors (Hazmat Board) consist of one voting Board member and an alternate appointed by the governing body from the City of Anaheim, Orange County Fire Authority, City of Santa Ana, and the City of Huntington Beach.Distribution of fair share contributions to reimburse the provider agencies are as follows: City of Anaheim, 27.3%; Orange County Fire Authority, 27.3%; City of Santa Arta, 27.3%;and City of Huntington Beach, 18.1%.At the direction of the Hazmat Board, rev'enues are disbursed to the provider agencies at the end of each preceding quarter. Audited financial information for the joint powers authority as of and for the year ended June 30, 2007, is as follows: Total assets Total liabilities Members' equity Total revenues total expenses Revenues over expenses$ 68 45 23 159 158 Hazmat does not have any debt outstanding at June 30, 2007.The City has no significant equity interest in Hazmat, and accordingly neither assets nor liabilities of Hazmat have been recorded in the City's basic financial statements.
For a copy of Hazmat's separate financial statements, contact the Finance Director of the City.Metro Cities Fire Authority The City participates in a joint powers authority, Metro Cities Fire Authority (Fire Authority), for the purpose of providing a central commuunication network and record keeping system to support fire suppression, emergency medical assistance, rescue service, and related services provided by the members of the Fire Authority.
The following entities are members of the Fire Authority:
City of Anaheim, City of Fountain Valley, City of Fullerton, City of Garden Grove, City of Huntington Beach, City of Newport Beach, and the City of Orange.Public entities in Orange County may receive services from the Fire Authority by executing an agreement and paying a fair share contribution.
Audited financial infonnation for the Fire Authority as of and for the year ended June 30, 2007, is as follows: Total assets Total liabilities Members' equity Total revenues Total expenses Revenues over expenses$1,266 468 798 4.326 4,207 119 61 CITY OF ANAHEIM The City has no significant equity interest in the Fire Authority, and accordingly neither assets nor liabilities of the Fire Authority have been recorded in the City's basic financial statements.
For a copy of the Fire Authofity's separate financial statements, contact the Finance Director of the City.Jointly-owned utility plants The City's Electric Utility owns a 10.04% ownership interest in the coal-fired San Juan Generating Station, Unit 4, located near Waterflow, New Mexico. The other participants in Unit 4 and their respective ownership include: Public Service of New Mexico, 45.48%;City of Farmington, New Mexico, 8.48%; County of Los Alamos, New Mexico, 7.20%;and M-S-R Public Power Agency, 28.80%. There are no separate financial statements for this venture, as each participant's interest in the utility plant is included in their respective financial statements.
The City's cumulative share of construction costs included in the utility plant at June 30, 2007, amounted to $66,929. The City's bonded indebtedness incurred to finance the purchase of the 10.04% ownership interest is also included in the basic financial statements.
Pursuant to a settlement agreement with SCE dated August 4, 1972, the City was granted the right to acquire a 1.66% ownership interest in SONGS and subsequently, ownership was later increased to 3.16%. In the settlement agreement, SCE agreed to provide the necessary transmission service to deliver the output of SONGS to the City. As a result of a restructuring agreement between SCE and the City, these transmission services are now provided by California Independent System Operator (CAISO). SCE and the City entered into' the SONGS Operating Agreement that sets forth the terms and conditions under which the City, through the Electric Utility, participates in the ownership and output of SONGS. Maintenance and operation of SONGS remains the responsibility of SCE.On June 22. 2004, SCE, as operating agent for the SONGS, gave notice that SCE had declared an Operating Impairment.
As a result of SCE's action, on October 11, 2004, the City exercised its option not to participate in the restoration work related to the impairment and to have its ownership share reduced per provisions of the Agreement.
On December 20, 2005, the City and SCE entered into an agreement for the City to transfer its interest in SONGS to SCE once SCE obtained approval from the California Public Utilities Commission (CPUC), California State Lands Commission, and U.S. Nuclear Regulatory Commission (NRC). SCE obtained all such approvals prior to the sale date.The City sold its ownership interest of SONGS to SCE on December 29, 2006.Accordingly, utility plant, in the amount of $214,134, was removed from capital assets and the Electric Utility ceased recording all related operating expenses, except marine mitigation costs and spent fuel storage charges, as of December 29, 2006. The original useful life (through 2022) of the SONGS utility plant assets was decreased and depreciation was accelerated in fiscal years 2007 and 2006. Based on the SONGS settlement agreement, the Electric Utility is responsible for the Citys share of marine mitigation costs up to $2,300, and SCE is responsible for costs between $2,300 and$7,300. The Electric Utility is responsible for spent fuel storage charges until the federal government takes possession.
As a former participant in SONGS, the Electric Utility is subject to assessment of retrospective insurance premiums in the event of a nuclear incident at SONGS or any other licensed reactor in the U.S.NOTE 13 -COMMITMENTS AND CONTINGENCIES:
Intermnountain Power Agency The Electric Utility has entered into a power purchases contract with the Intermountain Power Agency (IPA) for delivery of electric powel: The share of IPA power is equal to 13.225% of the generation output of IPA's two coal-fueled generating units located in Delta, Utah. The City is obligated for the following percentage of electrical facilities at IPA: Generation Power Project Entitlement 13.2% , Expiration 2027 The contract constitutes an obligation of the Electric Utility to make payments from revenues and requires payment of certain minimum charges. These minimum charges include debt service requirements on the financial obligations used to construct the plant.These requirements are considered a cost of purchased power and are quantified below.Southern California Public Power Authority The Electric Utility is a member of the Southern Calirornia Public Power Authority (SCPPA), a joint powers agency. SCPPA provides for the financing and construction of electric generating and transmission projects for participation by some or all of its members. To the extent the Electric Utility participates in projects developed by SCPPA, it is obligated for its proportional share of the cost of the project. The City is obligated for the following percentage of electrical facilities owned by SCPPA: 62 CITY OF ANAHEIM Transmission Southern Transmission System (STS)Mead-Adelanto Project (MAP)Mead-Phoenix Project (MPP)Generation Hoover Dam Uprating (Hoover)Magnolia Generating Station (Magnolia)
SCPPA Natural Gas Project -Pinedale SCPPA Natural Gas Project -Barnett Entitlement 17.6%13.5%24.2%Entitlement 42.6%38.0%62.5%55.6%Expiration 2027 2030 2030 Expiration 2018 2037 2008 2008 year. The fiscal year 2007 expenses for ftel, O&M, A&G and other costs at these projects were as follows: Fiscal Year IPA STS MAP MPP Hoover Magnolia Gas 2007 $44,739 $2,680 $213 $304 $263 $37,964 $365 Total$86,528 Take or pay commitments As part of the take or pay commitments with IPA and SCPPA, the Electric Utility has agreed to pay its share of current and long-term obligations.
Payment for these obligations will be made from the operating revenues received during the year that the payment is due.A long-term obligation has not been recorded on the accompanying basic financial statements for these commitments.
The following schedule details the amount of debt service that is due and payable by the Electric Utility for each project and the final maturity date.Fiscal Year Ending 6/30 2008 2009 2010 2011 2012 2013-2017 2018-2022 2023-2027 2028-2032 2033-2037 Total IPA$ 38,708 35,711 37,889 39,123 41,333 181,320 138,079 9,103$5 212 266 Natural STS MAP MPP Hoover Magnolia Gas Total$ 12,320 $ 2,856 $ 1,591 $ 957 $ 5,240 $44,290 S 105X962 11,891 2,852 1,589 957 8,814 61,814 11,978 2,857 1,586 956 8,990 64.256 12,114 2,928 1,822 957 8,988 65.932 15,018 2,917 1,815 956 8,989 71.1028 67,405 14,511 8,228 4,787 44,940 321,191 69,315 11,616 6,225 956 35,416 261,607 12,751 35,502 57,356 35,663 35,663 52,58 4 51,580 12:1:2:792 L40,537 ý$22856 $10,526 $244,122 $44.290 $1,096,389 The Honda Center Effective December 16, 2003, the City and Anaheim Arena Management LLC (AAM)entered into a Facility Management Agreement (FMA) whereby AAM has the exclusive right and license to manage, maintain and operate all aspects of the facility in accordance with the FMA through June 30, 2023 with an option to extend tile term for an additional period not to exceed 10 years. Annual distributions to the City, AAM and the County of Orange are required for their respective share of adjusted net revenues, as defined in the FIVMA. In the event that cash on hand is insufficient to pay operating expenses, debt service, distributions to the City, the County of Orange, or other amounts payable, AAM shall make or cause an affiliate or third-party lending institution to make loans for such purposes, as defined in the FMA. Such funds will be repaid from gross revenues or adjusted net revenues, if any, as defined in and in accordance with disbursement priorities established in the FMA. At June 30, 2007, tile outstanding conduit debt ott tile Honda Center totaled $39,500. The debt is non-recourse, payable from revenues generated by the facility.
Neither the faith and credit nor the taxing power of the City is pledged to the payment of the debt. The debt is not a general or special obligation of the City, nor does it contain any credit enhancements that secondarily pledge existing or future resources of the City (other than revenues generated by the facility), and accordingly it is not reflected in the accompanying basic financial statements.
On January 26, 1999, the City entered into a series of lease transactions for the Honda Center. Under these transactions, the City leased the Honda Center to a third party trustee acting for the benefit of an equity investor for a term of approximately 39.2 years. The trustee sublet the facility back to the City for 20 years, which was shorter than the then remaining term of the management agreement between the third-party manager at that time (Manager) and the City in consideration of an advance rental payment for the entire lease term. At the end of the sublease, the City has a purchase option to purchase the trustee's rights under the lease for a fixed amount. The advance rent payments to the City were deposited into a trust fund and invested.
The cash scheduled to be available from this trust fund is sufficient to pay the City's rent payments for the term of the sublease and to exercise the City's purlchase option at the end of the sublease.
The excess of the atnount of In addition to debt service, the City's entitlement requires the payment for fuel costs, operations and maintenance (O&M), administration and general (A&G) and other miscellaneous costs associated with the generation and transmission facilities discussed above. These costs do not have a similar structtred payment schedule as debt service, however, prior experience indicates that annual costs are generally consistent from year to 63 CITY OF ANAHEIM the advance rent payment made by the trustee to the City over the deposit to the trust finds, after the payment of fransaction expenses and payment to the Manager for agreeing to pledge its interestas Manager under the management agreement then in effect and agreeing to undertake certain additional obligations to the transaction, was approximately
$4,000. This amount was recognized by the City as deferred revenue and is being amortized over the sublease term. The City has secured its obligations to the other parties to these lease transactions by a pledge of its respective interest in revenues from the facility, subordinate (with certain exceptions) to any interests of the debt holders of the facility.
The City's obligations urnder these lease transactions are considered to be defeased in substance, and therefore the related liabilities as well as the trust assets have been excluded from the City's financial statements.
The City's and AAM's respective rights under the FMA are subject in certain respects to the effect of the 1999 lease transaction.
Angel Stadium of Anaheim On May 14, 1996, the City and the California Angels, LP (Team), which was then managed by Disney Sports Enterprises, Inc. (subsequently known as Anaheim Sports, Inc.), entered into an agreement to provide for the -operation and refurbishmlent of the Stadium. Pursuant to the agreement, the Team assumed responsibility for the operation of the Stadium on October 1, 1996. The agreement runs for 33 years (subject to a limited Team option to cancel at 20 years and the Team's right to extend the term).Under the terms of the agreement, the Team assumed full responsibility for all Stadium operations and maintenance, including capital maintenance.
The Team books all Stadium and parking lot events (except for ten annual City events), pays all expenses, and retains all revenue (subject to the City's rights to share in certain net revenues) except that the City credits the Team up to $500 per year adjusted annually for CPI for a capital reserve, calculated on the basis of property taxes. The City's participation in net revenues includes amounts received by the Team above certain thresholds including paid admissions
($2.00 per paid admission in excess of 2.6 million admissions per year), net income from non-game events (in excess of $2,000 per year adjusted annually for CPI), and parking lot net income (25% in excess of $4,000 per year adjusted ainually for CPI). Additionally, as indicated above, the City retained the right to book and retain all revenue from ten parking lot events per year. Major League Baseball consented to the transfer of the Team in fiscal year 2003 to interests controlled by Arte Moreno. No changes in the. terms of the agreement with the Team were made in connection with that transfer.The Agreement also provided that the City had the right to develop approximately 42 acres of the parking lot development site. In 1998 a land sale of $1,000 for a 1.25 acre site was approved for the construction of a 1,100-seat theatre called "Tinsettown Studios" (now known as "The Grove of Anaheim").
In November 2002, the City purchased the facility and the land for $6,700 from its then owner, SMG, a Pennsylvania partnership, an affiliate of Aramark Entertainment, Inc. Concurrent with the purchase, the City granted to Nederlander-Grove LLC (Nederlander) a license to operate the facility for three years with the right to extend another five years. Under the terms of the agreement, Nederlander receives a management fee of $150. Nederlander paid-the City $295 for the year ended June 30, 2007 for parking and common area maintenance.
Additionally, The City and Nederlander each participate 50% in tile annual net profits and net losses from operations, as defined in the management agreement.
Nederlander is responsible for 100% of losses in excess of $400, thereby limiting the City's share of net losses to a maximum of $200 in any given year. The City may elect to terminate the agreement prior to expiration of the term under certain conditions, and pay the unamortized balance of capital assets purchased during the tern to Nederlander.
In May 1999, the City approved the sale to Summit Commercial Properties of a 1.5 acre building site on the development site for $4,190. The transaction closed in March 2000, and the owner, HPMC Stadium Gateway Associates, LLC, constructed a 250,000 square foot, six-story office building on the parcel. The "Stadium Gateway Anaheim" office building opened for business on October 1, 2001. It is currently owned and operated by Maguire Properties
-Stadium Gateway, L.P. The owner paid tile City $189 for the year ended June 30, 2007, for parking and common area maintenance.
The City is continuing to pursue other opportunities for future development of the development site.Litigation A number of claims and suits are pending against the City for alleged damages to persons and/or property and for other alleged liabilities arising out of matters usually incident to the operation of a city such as Anaheim. Although the aggregate amount asserted for such lawsuits and claims is significant, in the opinion of City management, the City has strong defenses against such claims, and thus tile ultimate loss, if any, relating to these claims and suits not covered by insurance, will not materially affect the financial position of the City.Grants Amounts received or receivable from grant agencies are subject to audit and 'adjustment by grantor agencies.
Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of expenditures that may be disallowed by the grantor cannot be determined at this time, although the City expects such amounts, if any, to be immaterial.
64 CITY OF ANAHEIM Construction and other significant commitments At June 30, 2007, the City had the following commitments with respect to unfinished capital projects: NOTE 14- SUBSEQUENT EVENTS: Pacific Western Bank business loan agreement In July 2007, the Redevelopment Agency exercised its option to extend the repayment of its business loan agreement with Pacific Western Bank of $4,800 from July 2007 to January 2008.Remaining Construction Capital Proiect Commitment Anaheim 69/12 kilovolt Geographic Information System (GIS)Substation
$20,643 Anaheim Hills Road. Transmission Water Main Phase 1 2,269 Automotive Equipment Acquisitions 12,840 Brookhurst
-La Pahna Sewer Improvement 1,196 CIM Public Improvement Project 12,050 Direct Buried Cable Replacement
-Phase V 4,405 Energy Field Project-Site Improvements 3,884 Fleet Facility Underground Fuel Storage Tank Replacement 561 Houston Avenue, Gilbert Street, Cornet Avenue, Gorton Street, Clover Avenue and Fulton Street Sewer Improvements 1,937 Katella Avenue-Phase It from east of Jean Street to intersection of Easy Way and Sumac Lane Sewer Improvement 1,996 Katella Smart Street -Demolition 974 Lewis 230 kilovolt Extension 4,887 Lincoln and Dale Sewer hIprovement 988 Orange Avenue Street Improvement!Beach Boulevard-Magnolia Avenue 1,194 Right of Way. Clearing and Demolition for the Gene Autry Way/I-5 Highway and High Occupancy.
Vehicle Interchange Project 1,109 State College Boulevard Median and Landscape Beautification From Sotith Street to Broadway (Phase 4B) 858 Technology Development 3,684 Underground District No. 52 Phase II 960 Underground District No. 40 Santa Ana Canyon Road 965 Well No. 48 at Dad Miller Golf Course 603 Well No. 34 at Willow Park 881 Expected Completion Date 12/09 Prepaid gas project\04/08 03/08 Anaheim is a participant in the SCPPA-owned "Gas Project No. 1" which includes the 02/08 acquisition of a fixed quantity of natural gas to be delivered over approximately 30 years 06/08 beginning July 1, 2008, by J. Aron & Company tinder a Prepaid Natural Gas Sales 12/07 Agreement between J. Aron and SCPPA. The Prepaid Natural Gas Sales Agreement 03/08 provides for the delivery of gas to delivery points on the natural gas pipelines that serve 12/07 the project participants.
Each project participant has its own Prepaid Natural Gas Sales 11/07 Agreement and the City's agreement amounts to $82,725 over the next 30 years. Bonds were issued to fund the prepayment by SCPPA dated October 1, 2007.12/07 06/08 12/07 10/07 09/07.01/09 08/07 06/08 10/07 12/107 05/08 01/08 65 CITY OF ANAHEIM Required Supplementary Information (In thousands)
Miscellaneous Employees Retirement System -Schedule of Funding Progress (A) (B) (C) (D) (E) (F)Unfunded UL as a Actuarial Actuarial Liability Funded Ratios Annual % of Valuation Value of Accrued (UL) -AMA Market Covered Payroll Date Assets (AVA) Liability (A) -(B) (A)/(B) Value Payroll (C)/(E)6/30/04 $522,367 $570,446 $48,079 91.6% 90.0% $92,707 51.9%6/30/05 558,080 609,265 51,185 91.6% 94.0% 95,981 53.3%6/30/06 605,003 684,994 79,991 88.3% 93.4% 97,014 82.5%Police Safety Employees Retiremint System -Schedule of Funding Progress (A) (B) (C) (D) (E) (F)Unfunded UL as a Actuarial Actuarial Liability Funded Ratios Annual % of Valuation Value of Accrued (UL) AVA Market Covered Payroll Date Assets (AVA) Liability (A) -(B) (A)/(B) Value Payroll (C)/(E)6/30/04 $290,017 $343,815 $53,798 84.4% 83.1% $32,839 163.8%6/30/05 313,669 370,553 56,884 84.6% 87.2% 35,178 161.7%6/30/06 -336,967 392,350 55,383 85.9% 91.3% 35,807 154.7%Fire Safety Employees Retirement System -Schedule of Funding Progress (A) (B) (C) (D) (E) -(F)Unfunded UL as a Actuarial Actuarial Liability Funded Ratios Annual % of Valuation Value of Accrued (UL) AVA Market Covered Payroil Date Assets (AVA) Liability (A) -(B) (A)/(B) Value Payroll (C)/(E)6/30/04 $186,447 $215,603 $29,156 86.5% 85.1% $19,665 148.3%6/30/05 200,637 229,605 28,968 87.4% 89.9% 20,672 140.1%6/30/06 213,734 250,239 36,505 85.4% 90.6% 20,625 177.0%66
NONMAJOR GOVERNMENTAL FUNDS SPECIAL REVENUE FUNDS are used to account for revenue derived from specific taxes or other earmarked revenue sources (other than for major capital projects) that are restricted by law or administrative action to expenditures for specified purposes.GAS TAX AND ROADS FUND -Established to account for the construction and maintenance of the road network system of the City. Financing is primarily provided by the City's share of Federal, State, and local gasoline taxes. Federal, State, and local regulations require that these gasoline taxes be used to improve and maintain streets, and includes programs that improve the air quality of the region.WORKFORCE DEVELOPMENT FUND -Established to account for the City's involvement in Federal, State, and local programs to create jobs and provide the unemployed citizens in the Anaheim area with job training opportunities.
COMMUNITY DEVELOPMENT BLOCK GRANT FUND -Established to account for financing of rehabilitation of privately held homes and government infrastructure.
Financing is provided by the Federal Housing and Community Development Act.COMMUNITY SERVICES FACILITIES FUND -Established to account for the development of new park sites, playgrounds, and other community facilities.
Financing is provided by State and Federal reimbursement programs in conjunction with fees charged to residential and commercial developers.
SEWER AND STORM DRAIN CONSTRUCTION FUND -Established to account for the construction of the City's sewer and storm drain system. Financing is provided by fees charged to residential and commercial developers.
GRANTS FUND -Established to account for various grants requiring segregated fund accounting.
Financing is provided by Federal, State, and local agencies.ANAHEIM RESORT MAINTENANCE DISTRICT FUND -Established to account for the levy and collection of special assessments to pay the cost of annual maintenance and improvements within the district against those parcels which specifically benefit from the enhanced maintenance and improvements.
NARCOTIC ASSET FORFEITURE FUND -Established to account for funds received from Federal and State agencies which are derived from monies and property seized by the Police Department in drug related incidents.
These funds are used to supplement existing resources of the City's law enforcement activities.
REDEVELOPMENT HOUSING SET-ASIDE FUND -Established for the purpose of increasing and improving the community's supply of low and moderate income housing in accordance with the California Community Redevelopment Law. Financing is provided from property tax increment.
DEBT SERVICE FUNDS are used to account for the accumulation of resources and the payment of principal and interest on general debt of the City and related entities.MUNICIPAL IMPROVEMENTS FUND -Established to accumulate resources for the payment of principal and interest on general obligation bonds of the City. Debt service is financed by property tax revenues.REDEVELOPMENT AGENCY FUND -Established to accumulate resources for payment of principal and interest on Redevelopment Agency tax allocation bonds and notes payable. Debt service is financed by property tax increment.
CERTIFICATES OF PARTICIPATION FUND -Established to accumulate resources for payment of the principal and interest on the certificates of participation for the Parking Facility Project, Police Facilities Projects, Arena Land Acquisition, and other various acquisitions and capital improvements.
ANAHEIM RESORT IMPROVEMENTS FUND -Established to accumulate resources for payment of the principal and interest on the lease revehue bonds for The Anaheim Resort improvements.
CAPITAL PROJECTS FUNDS are used to account for resources used for the acquisition and construction of capital facilities by the City, except for those financed by pro-prietary funds.REDEVELOPMENT AGENCY FUND -Established to account for the acquisition, relocation, demolition, and sale of property for those portions of Anaheim earmarked as in need of redevelopment related activities.
Financing is provided by property tax increment and bond proceeds.OTHER CAPITAL IMPROVEMENTS FUND -Established to account for miscellaneous capital projects as determined by the City Council. Currently, financing is provided by fees from developers for infrastructure improvements and subsidies from the General Fund.
CITY OF ANAHEIM Combining Balance Sheet Nonmajor Governmental Funds by Fund Type June 30, 2007 (In thousands)
Nonmajor Nonmajor Nonmajor Total Special Debt Capital Nonmajor Revenue Service Projects Governmental Funds Funds Funds Funds ASSETS Cash and cash equivalents
$ 5,568 $ 4;208 $ 13,397 $ 23,173 Inveshments 11,677 8,767 28,885 49,329 Accounts receivable, net 42 23 65 Accrued interest receivable 256 202 424 882 Notes receivable 13,368 8.987 22,355 Due from other funds 1 11,610 11,611 Due from other governments 30,306 537 162 31,005 Land held for resale, net 19,421 44,653 64,074 Prepaid and other assets 1,209 3 111 1,323 Restricted cash and cash equivalents 5,667 11,066 2,485 19,218 Restricted investments 25,197 25,197 Total assets $87,515 $49,980 $110,737 $248,232 LIABILITIES AND FUND BALANCES Liabilities:
Accounts payable $ 4,917 $ 3,044 $ 6,587 $ 14,548 Wages payable 316 90 406 Short-term note payable 2,759 2,759 Interest payable on short-term note 64 64 Deposits 141 1,168 1,309 Due to other funds 9,422 63 25,479 34,964 Due to other governments 73 8 81 Deferred revenue 42,594 9,005 51,599 Total liabilities
' 60,286 3,107 42,337 .105,730 Fund balances: Reserved for encumbrances 12,628 4,072 16,700 Reserved for noncurrent due from other funds I 10,893 10,894 Reserved for debt service 44,594 44,594 Reserved for land held for resale 19,421 44.653 64,074 Reserved for prepaid and other assets 1,209 3 111 1,323 Unreserved
-designated for debt service 2,276 2,276 Unreserved
-designated for capital projects 2,415 35,510 37,925 Unreserved
-undesignated (8,445) (26,839) (35,284)Total fund balances 27,229 46,873 68,400 142,502 Total liabilities and fund balances $87,515 $49,980 $110,737 $248,232 67 CITY OF ANAIIEIM Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds by Fund type Year Ended June 30, 2007 (in thousands)
Nonmajor Nonmajor Total Special Nonmajor Capital Nonnmajor Revenue Debt Service Projects Governmental Funds Funds Funds Funds Revenues: Property taxes $ 11,982 $ 33,236 $ 45,218 Licenses, fees and permits 4,779 $ 9,890 14,669 Intergovernmental revenues 45,561 6 162 45,729 Charges for services 134 134 Use of money and property 3,069 1,786 4,872 9,727 Other 3,278 3,387 6,665 Total revenues 68,803 35,028 18,311 122,142 Expenditures:
Current: City Attorney 119 119 Finance 19 19 Police 11,439 335 11,774 Fire 341 341 Community Development 11,993 2,729 13,862 28,584 Planning 1,294 1,294 Public Works 8,446 999 9,445 Community Services 1,917 252 2,169 Convention, Sports and Entertainment 1,281 1,281 Capital outlay 45,630 28,524 74,154 Debt service: Principal retirement 82 15,148 538 15,768 Interest and fiscal agent charges 15 40,353 587 40,955 Debt issuance costs 3,815 202 4,017 Total expenditures 81,276 62,064 46,580 189,920 Deficiency of revenues under expenditures (12,473) (27,036) (28,269) (67,778)Other financing sources (uses): Transfers in 3,188 43,065 20,826 67,079 Transfers out (11,312) (11,723) (7,806) (30,841)Issuance of refunding bonds 256,320 256,320 Discount on refunding bonds (3,186) (3,186)-Payment to refunded bond escrow agent (255,325)
(255,325)Issuance of note payable 18,000 18,000 Capital leases 76 19 95 Total other financing sources (uses) (8,048) 29,151 31,039 52,142 Net change in fund balances (20,521) 2,115 2,770 (15,636)Fund balances at beginning of year 47,750 44,758 6 158,138 Fund balances at end of year $ 27,229 $ 46,873 $ 68,400 $ 142,502 68 CITY OF ANAHEIM Combining Balance Sheet Nonmajor Special Revenue Funds June 30, 2007 (In thousands)
Gas Tax Community Community Sewer and and Workforce Development Services Storm Drain Roads Development Block Grant Facilities Construction ASSETS Cash and cash equivalents
$ 178 $ $ $ 871 $ 1,567 Investments 371 6 1,829 3,290 Accounts receivable, net 4 $ 3 4 Accrued i nterest receivable 27 5 31 46 Notes receivable 4,460 Due from other funds Due from other governments 17,498 681 813 Land held for resale, net Prepaid and other assets 1,133 23 Restricted cash and cash equivalents Total assets $19,211 $ 707 $ 5,289 $2,731 $ 4,903 LIABILITIES AND FUND BALANCES Liabilities:
Accounts payable $ 1,826 $ 192 $ 754 $ 662 $ 16 Wages payable 76 37 75 5 2 Short-term note payable Interest payable on short-term note Deposits Due to other funds 453 118 Due to other governments 38 1 1 15 Deferred revenue 16,415 133 4,819 .Total liabilities 18,355 816 5,649 800 18 Fund balances (deficits):
Reserved for encumbrances 9,027 1,234 1,031 178 Reserved for noncurrent due from other funds Reserved for land held for resale Reserved for prepaid and other assets 1,133 23 Unreserved
-desiginated for capital projects Unreserved
-undesignated (9,304 (1,366) (1,391) 1,753 4,885 Total fund balances (deficits) 856 (109) -(360) 1,931 4,885 Total liabilities and fund balances $19,211 $ 707 $ 5,289 $2,731 $ 4,903 (continued) 69 CITY OF ANAHEIM Combining Balance Sheet Nonmajor Special Revenue Funds June 30, 2007 (In thousands) (continued)
Anaheim Resort .Narcotic Redevelopment Maintenance Asset Housing Grants District Forfeiture Set-Aside Total ASSETS Cash and cash equivalents
$1,332 $ 904 $ 715 $ 5,568 Investments 2,783 1,897 1,501 11,677 Accounts receivable, net 3 28 42 Accrued interest receivable
$ 20 38 27 62 256 Notes receivable 8,908 13,368 Due from other funds I I Due from other governments 11,155 28 131 30,306 Land held for resale, net 19,421 19,421 Prepaid and other assets 53 1,209 Restricted cash and cash equivalents 289 5,378 5,667 Total assets $11,464 $4,184- $2,828 $36,198 $87,515 LIABILITIES AND FUND BALANCES Liabilities:
Accounts payable $ 718 $ 370 $ 379 $ 4,917 Wages payable 39 17 $ 3 62 316 Short-term note payable 2,759 2,759 Interest payable on short-term note 64 64 Deposits 141 141 Due to other funds 7,756 1,095 9,422 Due to other governments 18 " 73 Deferred revenue 12,319 8,908 42,594 Total liabilities 20,850 387 3 13,408 60,286 Fund balances (deficits):
Reserved for encumbrances 131 2 125 900 12,628 Reserved lor noncurrent due from other funds 1 I Reserved for land held tbr resale 19,421 19,421 Reserved for prepaid and other assets 53 1,209 Unreserved
-designated for capital projects 2,415 2,415 Unreserved
-undesignated (9,517) 3,795 2,700 (8,445)Total fund balances (deficits)
(9,386) 3,797 2,825 22,790 27,229 Total liabilities and fuind balances $11,464 $4,184 $2,828 $36,198 $87,515 70 CITY OF ANAHEIM Combining Statement of Revenues, Expenditures and Changes in Fund Balances (Deficits)
Nonmajor Special Revenue Funds Year Ended June 30, 2007 (In thousands)
Gas Tax Community Community Sewer and and NVorkforce Development Services Storm Drain Roads Development Block Grant Facilities Construction Revenues: Property taxes Licenses, fees and permits $ 1,983 $ 1,935 $ 861 Intergovernmental revenues 24,523 $3,555 $6,909 701 Charges for services 134 Use of money and property 231 168 263 215 Other 942 -624 167 _ _Total revenues 27,813 3,555 7,701 3,066 1,076 Expenditures:
Current: City Attorney 119 Police Fire Community Development 3,241 2,396 Planning 1,294 Public Works 4,301 1 Community Services 819 935 Capital outlay 20,278 27 3,392 4,274 237 Debt service: Principal retirement 5 11 1 39 Interest and fiscal agent charges ____1 ____13 Total expenditures 24,584 3,280 8,021 5,261 238 Excess (deficiency) of' revenues over (under) expenditures-3,229 275 -320) (2,195) 838 Other financing sources (uses): Transfers in 758 597 Transfers out (4,933) (451)Capital leases 16 21 Total other financing sources (uses) (4,159) 21 146 Net change in fund balances (930) 296 (174) (2,195) 838 Fund balances (deficits) at beginning of year 1,786 (405) (186) 4,126 4,047, Fund balances (deficits) at end of year $ 856 $ (109) $ (360) $ 1,931 .$4,885 (continued) 7 71 CITY OF ANAHEIM Combining Statement of Revenues, Expenditures and Changes in Fund Balances (Deficits)
Nonmajor Special Revenue Funds Year Ended June 30, 2007 (In thousands) (continued)
Anaheim Resort Maintenance District Narcotic Asset Forfeiture Redevelopment Housing Set-Aside Revenues: Property taxes Licenses, fees and permits Intergovernmental revenues Charges for services Use of money and property Other Total revenues Expenditures:
Current: City Attorney Police Fire Community Development Planning Public Works Community Services Capital outlay Debt service: Principal retirement Interest and fiscal agent charges Total expenditures
-Excess (deficiency) of revenues over (under) expenditures Other financing sources (uses): Transfers in Transfers out Capital leases Total other financing sources (uses)Net change in fund balances Fund balances (deficits) at beginning of year Fund balances (deficits) at end of year Graints$ 8,844 79 75 8,998$ 3,840!242 5 4,087$1,029 106 62 1,197$ 8,142 1,765 1,403 11,310 10,508 341 42 163 4,265 931 15 1 15,335 (6,337)4,102 1,510 2 5,614 (1,527)6,356 11,585 62 Total$11,982 4,779 45,561 134 3,069 3,278 68,803 119 11,439 341 11,993 1,294 8,446 1,917 45,630 82 15 81,276 (12,473)3,188 (11,312)76 (8,048)(20,521)47,750$ 2_7 229 5 4 998 199 200 17,945 (6,635)1,633 (5,928)3 (4,292)(10,927)33,717-$ 22,790 32 32 (6,305)(3,081)$(9,386)4 204 (1,323)5,120$ 3J97 199 2,626$2,825 72 CITY OF ANAHEIM Schedule of Revenues, Expenditures and Changes in Fund Balances (Deficits)
Budget and Budgetary Basis Actual -All Nonmajor Special Revenue Funds Year Ended June 30, 2007 (n thousands)
Gas Tax and Roads Final Variance Budgeted Actual with Final Amounts Amounts Budget Workforce Development Final Variance Budgeted Actual with Final Amounts Amounts Budget Revenues: Property taxes Licenses, fees and pennits $ 229 $ 1,983 $ 1,754 Intergovernmental revenues 78,575 24,523 (54,052) $4,161 $3,555 $(606)Charges for services 108 134 26 Use of money and property 15 231 216 Other _ _942 942 Total revenues 78,927 27,813 (51,114) 4,161 3,555 (606)Expenditures:
City Attorney Police Fire Community Development 3,756 3,259 (497)Planning Public Works 76,538 24,568 (51,970)Community Services )Total expenditures 76,538 24,568 (51,970) "- 3,756 3,259 (497)Excess of revenues over expenditures 2,389 3,245 856 405 296 (109)Other financing sources (uses): Transfers in 758 758 Transfers out (4,933 (4,933 Total other financing sources (uses) (4,175) (4,175)Net change in fund balance (1,786) (930) 856 405 296- (109)Fund balances (deficits) at beginning of year 1,786 1,786 (405) .405)Fund balances (deficits) at end of year $ 856 $ 856 $ (109) $ (109)Adjustments to reconcile to GAAP: Purchases of land held for resale Conversion of land held for resale to capital assets Decline in value of land held for resale Ending fund balance -GAAP basis $ 856 $(10.9)(continued) 73 CITY OF ANAHEIM Schedule of Revenues, Expenditures and Changes in Fund Balances (Deficits)
Budget and Budgetary Basis Actual -All Nonmajor Special Revenue Funds Year Ended June 30, 2007 (In thousands) (continued)
Community Development Block Grant Community Services Facilities Final Variance Final Variance Budgeted Actual with Final Budgeted Actual with Final Amounts Amounts Budget Amounts Amounts Budget Revenues: Property taxes Licenses, fees and permits $ 4,519 $ 1,935 $(2,584)Intergovernmental revenues $12,036 $6,909 $(5,127) 2,751 701 (2,050)Charges for services Use of money and property 85 168 83 87 263 176 Other 400 624 224 2,100 167 (1,933 Total revenues 12,521 7,701 (4,820) 9,457 3,066 (6,391)Expenditures:
City Attorney 120 119 (1)Police Fire Community Development 6,457 4,568 (1,889)Planning 1,320 1,294 (26)Public Works 2,865 1,218 (1,647) 3,706 2,292 (1,414)Community Services 1,140 822 (318) 9,877 2,969 (6,908)Total expenditures 11,902 8,021 (3,881) 13,583 5,261 (8,322)Excess (deficiency) of revenues over (under) expenditures 619 (320) (939) (4,126) (2,195) 1,931 Other financing sources (uses): Transfers in 597 597 Transfers out (418) (451) (33)Total other financing sources (uses) (418) 146 564 Net change in fund balance 201 (174) (375) (4,126) (2,195) 1,931 Fund balances (deficits) at beginning of year (186) (186) 4,126 4,126 Fund balances (deficits) at end of year $ 15 (360) $ (375) $ 1,931 $ 1,931 Adjustments to reconcile to GAAP: Purchases of land held for resale Conversion of land held for resale to capital assets Decline in value of land held for resale Ending fund balance -GAAP basis $ (360) $ 1,931 (continued) 74 CITY OF ANAHEIM Schedule of Revenues, Expenditures and Changes in Fund Balances (Deficits)
Budget and Budgetary Basis Actual -All Nonmajor Special Revenue Funds Year Ended June 30, 2007 (In thousands) (continued)
Sewer and Storm Drain Construction Final Variance Budgeted Actual with Final Amounts Amounts Budget Revenues: Property taxes Licenses, fees and permits $ 290 $ 861 $ 571 Intergovernmental revenues Charges for services Use of money and property 83 215 132 Other Total revenues 373 1,076 703 Expenditures:
City Attorney Police Fire Community Development Planning Public Works 611 238 (373)Community Services Total expenditures 611 238 (373)Excess (deficiency) of revenues over (under) expenditures (238) 838 1,076 Other financing sources (uses): Transfers in Transfers out Total other financing sources (uses)Net change in fund balance (238) 838 1,076 Fund balances (deficits) at beginning of year 4,047 4,047 Fund balances (deficits) at end of year $3,809 4,885 $1,076 Adjustments to reconcile to GAAP: Purchases of land held forresale Conversion of land held for resale to capital assets Decline in value of land held for resale Ending fund balance -GAAP basis $4,885 Grants Final Variance Budgeted Actual with Final Amounts Amounts Budget$31,453 $ 8,844 S(22,609)79 79 48 75 27 31,501 8,998 (22,503)24,698 14,583 (10,115)679 457 (222)42 42 3,001 221 (2,780)28,420 15,303 (13,117)3,081 (6,305) (9,386)3,081 (6,305) (9,386)(3,081) (3,081)$ (9,386) S (9,386)$ (9,386)(continued) 75 CITY OF ANAHEIM Schedule of Revenues, Expenditures and Changes in Fund Balances (Deficits)
Budget and Budgetary Basis Actual- All Nonmajor Special Revenue Funds Year Ended June 30, 2007 (In thousands) (continued)
Anaheim Resort Maintenance District Final Variance Budgeted Actual with Final Amounts Amounts Budget Narcotic Asset Forfeiture Final Variance Budgeted Actual with Final Amounts Amounts Budget Revenues: Property taxes $ 3,939 $ 3,840 $ (99)Licenses, fees and permits Intergovernmental revenues $1,362 $1,029 $(333)Charges for services Use of money and property 91 242 151 106 106 Other 4 5 1 62 62 Total revenues 4,034 4,087 53 1,362 1,197 (165 Expenditures:
City Attorney Police 1,818 998 (820)Fire Community Development Planning Public Works 7,483 5,610 (1,873)* Community Services Total expenditures 7,483 5,610 (1,873) 1,818 998 (820)Excess (deficiency) of revenues over (under) expenditures (3,449) (1,523) 1,926 (456) 199 655 Other financing sources (uses): Transfers in 200 200 Transfers-out Total other financing sources 200 200 Net change in fund balance (3,249) (1,323) 1,926 (456) 199 655 Fund balances (deficits) at beginning of year 5,120 5,120 2626 2,626 Fund balances (deficits) at end of year $ 1,871 3,797 $ 1,926 $2,170 2,825 $ 655 Adjustments to reconcile to GAAP: Purchases of land held for resale Conversion of land held for resale to capital assets Decline in value of land held for resale Ending fund balance -GAAP basis $ 3,797 $2,825 (continued) 76 CITY OF ANAHEIM Schedule of Revenues, Expenditures and Changes in Fund Balances (Deficits)
Budget and Budgetary Basis Actual -All Nonmajor Special Revenue Funds Year Ended June 30, 2007 (In thousands) (continued)
Redevelopment Housing Set-Aside Final Variance Budgeted Actual with Final Amounts Amounts Budget Revenues: Property taxes $ 9,213 $ 8,142 $ (1,071)Licenses, fees and permits Intergovernmental revenues Charges for services Use of money and property 13,854 1,765 (12.089)Other 600 1,403 803 Total revenues 23,667 11,310 (12,357)Expenditures:
City Attorney Police Fire Community Development 17,917 13,043 (4,874)Planning Public Works Community Services Total expenditures 17,917 13,043 (4,874)Excess (deficiency) of revenues over (under) expenditures 5,750 1,733) (7,483)Other financing sources (uses): Transfers in 700 1,633 933 Transfers out (2,387) (5,92(3,541 Total other financing sources (uses) (1,687) (4,295) (2,608)Net change in fund balance 4,063 (6,028) (10,091)Fund balances (deficits) at beginning of year 33,717 33,717 Fund balances (deficits) at end of year $37,780 27,689 $(10,091)Adjustments to reconcile to GAAP: Purchases of land held for resale 5,921 Conversion of land held for resale to capital assets (9,430)Decline in value of land held for resale (1,390)Ending fund balance -GAAP basis $ 22,790 77 CITY OF ANAHEIM Combining Balance Sheet Nonmajor Debt Service Funds.June 30, 2007 (In thousands)
Municipal Redevelopment Certificates of Anaheim Resort Improvements Agency Participation Improvements Total ASSETS Cash and cash equivalents
$200 $ 4,005 $ 3 $ 4,208 Investments 419 8,343 5 8,767 Accrued interest receivable 5 119 48 $ 30 202 Due from other governments 12 525 537 Prepaid and other assets 3 3 Restricted cash and cash equivalents 520 103 10,443 11,066 Restricted investments
___2,306 5,365 17,526 25,197 Total assets $636 $15,821 $5,524 $27,999 $49,980 LIABILITIES AND FUND BALANCES Liabilities:
Accounts payable $ 2,961 $ 5 $ 78 $ 3,044 Due to other funds ______63 63 Total liabilities 2,961 5 141 3,107 Fund balances: Reserved for debt service $636 10,581 5,519 27,858 44,594 Reserved for prepaid and other assets 3 .3 Unreserved
-designated for debt service ___2,276 ________2,276 Total fund balances 636 12,860 5,519 27,858 46.873 Total liabilities and fund balances $636 $15,821 $5,524 $27,999 S49,980 78 CITY OF ANAHIEIM Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Debt. Service Funds Year Ended June 30, 2007 (in thousands)
Municipal Redevelopment Certificates of Anaheim Resort Improvements Agency Participation Improvements Total Revenues: Property taxes $668 $ 32,568 $ 33,236 Intergovermmental revenues 6 6 Use of" money and property 18 1,036 $ 313 $ 419 1,786 Total revenues 692 33,604 313 419 35,028 Expenditures:
Current: Finance 19 19 Community Development 2,729 2,729 Debt service: Principal retirement 470 6,348 3,040 5,290 15,148 Interest and fiscal agent charges 262 16,137 1,607 22,347 40,353 Debt issuance costs 3,815 3,815 Total expenditures 732 25,214 4,647 31,471 62,064 Excess (deficiency) of revenues over (under) expenditures (40) 8,390 (4,334) (31,052) (27,036)Other financing sources (uses): Transfers in 3,369 4,330 35,366 43,065 Transfers out (11,723) (11,723)Issuance of refunding bonds 256,320 256,320 Discount on refunding bonds (3,186) (3,186)Payment to refunded bond escrow agent (255,325 (255,325)Total other financing sources (uses) (8,354) 4,330 33,175 29,151 Net change in fund balances (40) 36 (4) 2,123 2,115 Fund balances at beginning of year 676 12,824 5,523 25,735 44,758 Fund balances at end of year $636 $ 12,860 $ 5,519 $ 27,858 $ 46,873 79 CITY OF ANAHEIM Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Budgetary Basis Actual -All Debt Service Funds Year Ended June 30, 2007 (In thousands)
Municipal Improvements Final Variance Budgeted Actual with Final Amounts Amounts Budget Redevelopment Agency Final Variance Budgeted Actual with Final Amounts Amounts Budget Revenues: Property taxes $733 $668 $(65) $ 27,647 $ 32,568 $ 4,921 Intergovernmental revenues 6 6 Use of money and property 18 18 556 1,036 480 Other 402 (402)Total revenues 733 692 (41_) 28.605 33,604 4,999 Expenditures:
Finance Police Community Development 733 732 (1) 29,095 25,214 (3,881)Public Works Convention, Sports and Entertainment Total expenditures 733 732 (1) 29,095 25,214 (3,881)Excess (deficiency) of revenues over (under) expenditures (40) (40) (490) 8,390 8,880 Other financing sources (uses): Transfers in 6.303 3,369 (2,934)Transfers out (11,780) (11,723) 57 Issuance of refunding bonds Discount on refunding bonds Payment to refunded bond escrow agent Total other financing sources (uses) (5,477) (8,354) (2,877)Net change in fund balance (40) (40) (5,967) 36 6,003 Fund balance at beginning of year 676 676 -12,824 12,824 Fund balance at end of year $676 $636 $(40) $ 6,857 $ 12,860 $ 6,003 (continued) 80 CITY OF ANAHEIM Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Budgetary Basis Actual -All Debt Service Funds Year Ended June 30, 2007 (in thousands) (continued)
Certificates of Participation Final Variance Budgeted Actual with Final Amounts Amounts Budget Anaheim Resort Improvements Final Variance Budgeted Actual with Final Amounts Amounts Budget Revenues: Property taxes 1ntergovernmental revenues Use of money and property Other Total revenues Expenditures:
Finance Police Community Development Public Works Convention, Sports and Entertainment Total expenditures Excess (deficiency) of revenues over (under) expenditures Other financing sources (uses): Transfers in Transfers out Issuance of refunding bonds Discount on refunding bonds Payment to refunded bond escrow agent Total other financing sources (uses)$ 194 194 2,040 270 629 1,708 4,647 (4,453)4,647 4,647 194$ 5,717$ 313 313$ 119 119 S 419 $ 419 419 419$ 31,475 2,040 270 629 1,708 4,647 (4,334)4,330 4,330 119 (317)(317)31,475 (31,475)34,186 256,320 (3,186)(255,325)31,995 31,471 31,471 (31,052)35,366 256,320 (3,186)(255,325)33,175 (4)(4)423 1,180 1,180 1,603$ 1,603 Net change in fund balances (4) (198)520 2,123 Fund balance at beginning of year Fund balance (deficit) at end of year 5,523$ 5,519$(198)25,735 25,735$ 26,255 $ 27,858 81 CITY OF ANAHEIM Combining Balance Sheet Nonmajor Capital Projects Funds June 30, 2007 (In thousands)
Redevelopment Other Capital Agency Improvements Total ASSETS Cash and cash equivalents
$ 1,099 $12.298 $ 13,397 Investments 2,644 26,241 28,885 Accounts receivable, net 23 23 Accrued interest receivable 34 390 424 Notes receivable 8,987 8,987 Due from other funds 2,505 9,105 11,610 Due from other governments 162 162 Land held for resale, net 44,653 44,653 Prepaid and other assets 111 ill Restricted cash and cash equivalents 22 2,463 2,485 Total assets $60,240 $50,497 $110,737 LIABILITIES AND FUND BALANCES Liabilities:
Accounts payable $ 5,443 $ 1,144 $ 6,587 Wages payable 68 22 90 Deposits 1,168 1,168 Due to other funds 23,691 1,788 25,479 Due to other governments 8 *8 Deferred revenue 9,005 9.005 Total liabilities 39,375 2,962 42,337 Fund balances: Reserved for encumbrances 1,152 2,920 4,072 Reserved for noncurrent due from other funds 1,788 9,105 10,893 Reserved for land held for resale 44,653 44,653 Reserved for prepaid and other assets Ill 1ll Unreserved
-designated for capital projects 35,510 35,510 Unreserved
-undesignated (26,839) (26,839)Total fund balances 20,865 47,535 68,400 Total liabilities and fund balances $ 60,240 $50,497 $110,737 82 CITY OF ANAHEIM Combining Statement of Revenues, Expenditures and Changes in Fund Balances -Nonmajor Capital Projects Funds Year Ended June 30, 2007 (In thousands)
Redevelopment Other Capital Agency Improvements Total Revenues: Licenses, fees and permits S9,890 S9,890 Intergovernmental revenues $ 162 162 Use of money and property 2,367 2,505 4,872 Other 653 2,734 3,387 Total revenues 3,182 15,129 18,311 Expenditures:
Current: Police 335 335 Community Development 13,848 14 13,862 Public Works 999 999 Community Services 252 252 Convention, Sports and Entertainment 1,281 1,281 Capital outlay 15,444 13,08(0 28,524 Debt service: Principal retirement 13 525 538 Interest and fiscal agent charges 1 586 587 Debt issuance costs 202 _____202 Total expenditures 29,508 17,072 46,580 Deficiency of revenues under expenditures (26,326) (1,943) (28,269)Other financing sources (uses): Transfers in 16,687 4,139 20,826 Transfers out (1,326) (6,4801) (7,806)Issuance of note payable 18,000 18,000 Capital leases 3 16 19 Total other financing sources (uses) 33,364 (2,325) 31,039 Net change in fund balances 7,038 (4,268) 2,770 Fund balances at beginning of year 13,827 51,803 65,630 Fund balances at end of year S 20,865 $47,535 $ 68,400 83 CITY OF ANAHEIM Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Budgetary Basis Actual -All Capital Projects Funds Year Ended June 30, 2007 (In thousands)
Redevelopment Agency Final Variance Budgeted Actual with Final Amounts Amounts Budget Other Capital Improvements Final Variance Budgeted Actual with Final Amounts Amounts Budget Revenues: Licenses, fees and permits $ 4,030 $ 9.890 S 5,860 Intergovernmental-revenues
$ 400 $ 162 $ (238) 850 (850)Use of money and property 2,550 2,367 (183) 152 2,505 2,353 Other 40,529 16,971 (23,558) 212 2,734 2,522 Total revenues 43,479 19,500 (23,979) 5,244 15,129 9,885 Expenditures:
Police 1,986 1,708 (278)Fire 900 (900)Community Development 65,530 59,235 (6,295) .1,113 1,111 (2)Public Works 664 (664) 23,569 10,978 (12,591)Community Services 7,961 1,978 (5,983)Convention, Sports and Entertainment 1,281 1,281 Total expenditures 66,194 59,235 (6,959) 36,810 17,056 (19,754)Deficiency of revenues under expenditures (22,715) (39,735) (17,020) (31,566) (1,927) 29,639 Other financing sources (uses): Transfers in 31,850 16,687 (15,163) 4,348 4,139 (209)Transfers out (18,410) (1,326) 17,084 (1,000) (6,480) (5,480)Issuance of long-term debt 20,660 18,000 (2,660 Total other financing sources (uses) 34,100 33,361 (739 3,348 (2,341) (5,689 Net change in fund balance 11,385 (6,374) (17,759) (28,218) (4,268) 23,950 Fund balance at beginning of year 13,827 13,827 51,803 51,803 Fund balance at end of year $ 25,212 7,453 $(17,759)
$ 23,585 47,535 $ 23,950 Adjustments to ieconcile to GAAP: Proceeds on sale of land held for resale (16,542)Purchase deposits on land held for resale 2,000 Purchases of land held for resale 39,104 Conversion of land held for resale to capital assets (7,445)Decline in value of land held for resale (1,481)Loss on sale of land held for resale (2,224)Ending fund balance -GAAP basis $ 20,865 $47,535 84
INTERNAL SERVICE FUNDS INTERNAL SERVICE FUNDS are used to account for the financing of centralized services to City departments on a cost-reimbursement basis (including depreciation).
GENERAL BENEFITS AND INSURANCE FUND -Established to account for employee compensated absences, retirement and health benefits, and self-insurance programs.MOTORIZED EQUIPMENT FUND -Established to account for motorized equipment used by City departments.
DUPLICATING AND PRINTING FUND -Established to account for central duplicating, printing and mailing services provided to City departments.
INFORMATION SERVICES FUND -Established to account for data processing services to City departments.
MUNICIPAL FACILITIES MAINTENANCE
-Established to-account for City office maintenance services and equipment used by City departments.
CITY OF ANAHEIM Combining Statement of Fund Net Assets Internal Service Funds June 30, 2007 (in thousands)
General Benefits Duplicating Municipal and Motorized and Information Facilities Insurance Equipment Printing Services Maintenance Total ASSETS Current assets: Cash and cash equivalents
$ 40,993 $ 3,156 $ 175 874 S 1,868 $ 47.066 Investments 85,615 6,590 368 1,836 3,726 98,135 Accounts receivable, net 872 872 Accrued interest receivable 1,194 100 4 41 50 1,389 Interfund receivable 17 17 Inventories 591 591 Prepaid and other assets 40 40 Total current assets 128,731 10,437 547 2,751 5,644 148,110 Noncurrent assets: hIterfund receivable, less current portion 62 62 Restricted cash and cash equivalents 18 18 Restricted investments 472 472 Unamortized debt issuance costs 7 7 Capital assets: Buildings and improvements 3,230 3,449 6,679 Equipment 108 39,978 491 15,712 2,233 58,522 Less accumulated depreciation (77) (28,142 (460) (7220) (3,905) (39,804)Capital assets, net 31 15,066 31 8,492 1,777 25,397 Total noncurrent assets 93 15,563 31 8,492 1,777 25,956 Total assets 128,824 26,000 578 11,243 7,421 174,066 LIABILITIES Current liabilities:
Accounts payable 3,946 404 146 842 495 5,833 Wages payable 1,088 85 10 14 89 1,286 Interest payable 40 40 Compensated absences 16,253 16,253 Self-insurance liability 8,278 8.278 Long-term debt 6 259 20 9 295 Postretircercnt employment benefits 7,787 7,787 Unearned revenues 910 0.700 2,610 Total current liabilities 38,268 2,488 157 876 593 42,382 Noncurrent liabilities:
Self-insurance liability, less current portion 22,619 22,619 Long-tern obligations, less current portion 6 1,136 1 24 5 1,172 Postretirement employment benefits, less current portion 65,536 65,536 lotal noncurrent liabilities 88,161 1,136 1 24 5 89,327 Total liabilities 126,429 3,624 158 900 598 131,709 FUND NET ASSETS Invested in capital assets, net of related debt 19 14,169 29 8,448 1,763 24,428 Restricted for debt service Unrestricted 2,376 8,207 391 1,895 5,060 17,929 Total fund net assets $ 2,395 $ 22,376 $ 420 $10,343 S 6,823 $ 42,357 85 CITY OF ANAHEIM Combining Statement of Revenues, Expenses and Changes in Fund Net Assets Internal Service Funds Year Ended June 30, 2007 (In thousands)
Operating revenues: Charges for services Other Total operating revenues Operating expenses: Salaries and wages Maintenance and operations Insurance premiums and claims Compensated absences and other benefits Depreciation Total operating expenses General Benefits and Insurance$105,690 182 105,872 2,870 2,814 7,408 99,291 21 112,404 (6,532)6,687 (1)6,686 Duplicating Motorized and Equipment Printing$10,610 1 10,611 3,753 4,997 12,230 (1,619)495 (79)148 564$1,803 1,803 363 1,335 41 1,739 64 17 (1)(2 14$12,216 5 12,221 479 10,629$ 8,589 87 8,676 3,247 6,404 Municipal Information Facilities Services Maintenance 1,994 128 13,102 -9,779 Operating income (loss)Nonoperating income (expenses):
Interest income Interest expense Gain (loss) from disposal of capital assets Total nonoperating income (881)128 (2)126 (1,103)232 (I)231 Total$138,908 275 139,183 10.712 26.179 7,408 99,291 5,664 149,254 (10,071)7,559 (84)146 7,621 (2,450)300 (2,150)$ 42,357 Income (loss) before transfers in Transfers in 154 (1,055)154 (1,055)78 (755)(872)Change in fund net assets Fund net assets at beginning of year Fund net assets at end of year S2,41$ 2,395 23,431$22,376 78 342$ 420 300 (455)101798$10,343 (872)7,695$ 6,823 86 CITY OF ANAHEIM Combining Statement of Cash Flows Internal Service Funds Year Ended June 30, 2007 (In thousands)
Cash flows from operating activities:
Receipts fronm interfund services provided Payments to suppliers Payments to employees Payments for interfund services used Payments for insurance premiums and claims Payments for compensated absences and other benefits Other receipts Net cash provided by.(used in) operating activities Cash flows from noncapital financing activities:
Payment of interfund balances Transfers in Net cash provided by noncapital financing activities Cash flows from capital and related financing activities:
Proceeds from sale of capital assets Capital purchases Principal payments on long-term debt Interest payments Net cash used in capital and related financing activities Cash flows from investing activities:
Purchase of investment securities Proceeds from sale and maturity of investment securities Interest received Net cash provided by (used in) investing activities Increase in cash and cash equivalents Cash and cash equivalents at beginning of the year Cash and cash equivalents at end of the year General Benefits and Insurance$ 105,690 (1,966)(2,941)(1,241)(7,016)(93,685)187 (972)6 6 Duplicating Motorized and Equipment Printing Municipal Information Facilities Services Maintenance Total$ 10,610 (4,837)(3,761)(404)1,864 3,472$ 1,803 (1,218)(361)(79)145 (7)I1)(8)(118,01l)147,089 7,093 36,171 35,197 5,796$ 40,993 250 (2,066)(248)(90)(2,154)* (11,187)12,128 517 1,458 2,776 398$ 3,174$ 12,216 (10,053)(479)(653)5 1,036 300 300 (365)(42)(2)(409)(3,385)3,138 114 (133)794 80$ 874$ 8,589 $ 138,9t08 (5,798) (23,872)(3,229) (10,771)(432) (2,809)(7,916)(93,685)87 2,143 (783) 2,898 6 300 306 (39)(40)(602)629 23 50 155 20$ 175 (572)(10)(1)(583)(3,683)6,367 233 2,917 1,551 317$1,868 250 (3,003)(346)(95)(3,194)(136,868)169,351 7,980 40,463 40,473 6,611$ 47,084 (continued) 87 CITY OF ANAHEIM Combining Statement of Cash Flows Internal Service Funds Year Ended June 30, 2007 (In thousands) (continued)
Reconciliation of operating income (loss) to net cash provided by operating activities:
Operating income (loss)Adjustments to reconcile operating income (loss)to net cash provided by (used in) operating activities:
Depreciation Changes in assets and liabilities:
Accounts receivable Inventories Prepaid and other assets Accounts payable Wages payable Unearned revenues Compensated absences Self-insurance liability Post retirement employment benefits Total adjustments"Net cash provided by (used in) operating activities Schedule of noncash financing and investing activities:
Capital assets finanfced through capital leases Decrease in fair value of investments General Benefits and Insurance$(6,532)21 527 (1,443)(71)185 473 69 5,799 5,560$ (972)$ 3 (456)$ 40,993$ 40,993 Duplicating Motorized and Equipment Printing$ (1,619) $ 64 Municipal Information Facilities Services Maintenance
-Total$ (881)1.994$(1,103 $ (10,071)3,480 17 146 (244)(8)1,700.5,091$ 3,472 S 3 (35)$ 3,156 18$ 3,174 41 18 20 2 81$ 145$ 2$ 175$ 175 128 5,664 562 146 (77)1,917$ 1.036$ 36$ 874$ 874 174 18 320$ (783)S 3 S 1,868 (1,570)(59)1,885 473 69 5,799 12,969$ 2,898 S 47 (491)$ 47,066 Reconciliation of cash and cash equivalents:
Cash and cash equivalents-Restricted cash and cash equivalents Total cash and cash equivalents 18$ 1,868 $ 47,084 (88
CITY OF ANAHEIM Statement of Changes in Fiduciary Assets and Liabilities Agency Fund -Mello-Roos Year Ended June 30, 2007 (n thousands)
Beginning Balance ASSETS Restricted cash and cash equivalents Due from other governments Total assets LIABILITIES Due to bond holders$3,587 44$3,631$3,631 Additions$ 9,757 2,674$12,431$ 9,750 Deductions
$ (9,067)(2,554)$(L1,621)$ (8,940)Ending Balance$4,277 164$4,441$4,441 89
,,*1 .N\<A-,L x ! ........ .... ',. t ::: lI dQ!t,:>:J'Z % K'::> j-V.' *V/ \ <;2 < " ', .(This page left biaink intentionally) 90
STATISTICAL SECTION The Statistical Section is included to provide detailed data on the physical, economic, social and political characteristics of the reporting government.
It is intended to provide the user with a broader and more complete understanding of the government and its financial affairs than is possible from the basic financial statements and supplementary information included in the Financial Section.
CITY OFANAHEIM STATISTICAL SECTION (Unaudited)
The Statistical Section is included to provide financial statement users with additional historical perspective, context, and detail for use in evaluating the information contained within the financial statements, notes to the financial statements, and required supplementary information with the goal of providing the user a better understanding of the City's economic condition.
Contents Page Financial trends These schedules contain information to help the reader understand how the City's financial performance and well-being have changed over time.Net Assets by Component
-Last Six Fiscal Years 92 Changes in Net Assets -Last Six Fiscal Years 93 Governmental Activities Tax Revenues by Source -Last Six Fiscal Years 95 Fund Balances of Governmental Funds -Last Ten Fiscal Years 96 Changes in Fund Balances of Governmental Funds -Last Ten Fiscal Years 97 Revenue capacity These schedules contain information to help the reader assess the Citys most significant local revenue sources.General Government Tax Revenues by Source -Last Four Fiscal Years 98 Assessed Value of Taxable Property -Last Four Fiscal Years 99 Property Tax Rates -Direct and Overlapping Governments
-Last Four Fiscal Years IOU Principal Property Tax Payers -Last Ten Fiscal Years 101-Property Tax Levies and Collections
-Last Four Fiscal Years 103 Debt capacity These schedules contain information to help the reader assess the affordability of the City's current levels of outstanding debt and the City's ability to issue additional debt in the future.Ratios of Outstanding Debt by Type -Last Four Fiscal Years 104 Ratios of General Bonded Debt Outstanding
-Last Ten Fiscal Years 105 Direct and Overlapping Governmental Activities Debt -As of Julie 30, 2007 106 Legal Debt Margin -Last Ten Fiscal Years 108 Pledged-Revenue Coverage -Last Ten Fiscal Years 109 Demographic and economic information These schedules offer demographic and economic indicators to help the reader understand the environment within which the City's financial activities take place.Demographic and Economic Statistics
-Last Four Fiscal Years Ill Principal Employers
-Last Four Fiscal Years 112 Operating information These schedules contain service and infrastructure data to help the reader noderstand how the information in the City's financial statements relate to the services the City provides and the activities it performs.-
Full-time Equivalent City Government Employees by Function/Program
-Last Four Fiscal Years 113 Operating Indicators by Function -Last Four Fiscal Years 114 Capital Assets Statistics by Function -Last Four Fiscal Years 115 City of Anaheimo Map , 116 Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial reports for the relevant fiscal year.91 CITY OF ANAHEIM Net Assets by Component Last Six Fiscal Years (In thousands)(Accrual basis of accounting)
Fiscal Year 2007 2006 2005 2004 2003 2002 Governmental Activities Invested in captial assets, net of related debt $ 667,414 $ 668,628 $ 613,300 $ 584,875 $ 522,073 S 516,931 Restricted 69,949 99,443 87,505 111,344 112,168 138,241 Unrestricted (33,187) (61,368) (56,074) (66,860) (14,286) (25,751)Total Governmental Activities 704,176 706,703 644,731 629,359 619,955 629,421 Business-type Activities Invested in capital assets, net of related debt 707,119 660,769 697,647 673,244 666,361 639,652 Restricted 38,572 36,008 28,855 26,187 33,188 30,849 Unrestricted 203,967 215,685 229,051 242,888 232,569 248,968 Total Business-type Activities 949,658 912,462 955,553 942,319 932,118 919,469 Total Government Invested in capital assets, net of related debt 1,374,533 1,329,397 1,310,947 1,258,119 1,188,434 1,156,583 Restricted 108,521 135,451 116,360 137,531 145,356 169,090 Unrestricted 170,780 154,317 172,977 176,028 218,283 223,217 Total Government
$1,653,834
$1,619,165
$1,600,284
$1,571,678
$1,552,073.
$1,548,890
.<Total Gov ernment Net Assets Si 500,000 ----1,250,000 ul6oomo 70,050000 I 0_2007 20020056 2004 2003 2002-Fiscal b R es M Invested ini Capital Assets, Net of Related Debt E Restnicted D Unrestricted Source: Finance Department, City of Anaheim 92 CITY OF ANAH EIM Changes in Net Assets Last Six Fiscal Years (in thousands)(Accrual basis of accounting)
Fiscal Year 2007 2006 2005 2004 2003 2002 Program Revenues Governmental activities:
Charges for services General government
$ 4,757 $ 4,516 1,642 $ 1,413 $ 1,651 $ 1,662 Police 7,590 7,346 9,840 7,460 8,369 7,236 Fire 11,033 8,942 7,909 6,879 6,475 6,391 Community Development 6,713 6,122 4,667 9,972 6,843 5,753 Planning 10,790 9,031 6,994 3,739 3,869 3,773 Public Works 11,662 7,653 6,544 5,501 6,339 7,294 Community Services 10,320 18,421 4,985 4,490 3,936 4,629 Total charges for services 62,865 62,031 42,581 39,454 37,482 36,738 Operating grants and contributions 97,633 87,024 77,870 81,877 75,594 72,111 Capital grants and contributions 30,123 29,004 20,906 11,904 13,009 15,581 Governmental activities program revenues 190,621 178,059 141,357 133,235 126,085 124,430 Business-type activities:
Charges for services Electric Utility 310,074 322,845 284,740 295,723 272,024 300,474 Water Utility 49,6(10 46'926 43,427 44,395 41,801 41,845 Sanitation 53,215 49,397 46,480 48,085 43,045 41,809 Golf Courses 6,022 5,736 5,394 5,546 5,401 5,739 Convention, Sports and Entertainment Venues 32,308 27,357 27,412 28,146 22,509 21,688 Total charges for services 451,219 452,261 407,453 421,895 384,780 411,555 Operating grants and contributions 1,160 2,556 2,473 1,471 1,560 3,622 Capital grants and contributions 4,808 5,749 11,513 7,468 5,389 13,113 Business-type activities program revenues 457,187 460,566 421,439 430,834 391,729 428,290 Total government program revenues 647,808 638,625 562,796 564,069 517,814 552,720 Expenses Governmental activities:
General government 10,951 7,394 8,943 7,582 9,793 6,780 Police 115,714 98,484 91,713 77,541 78,313 73,336 Fire 50,727 50,957 46,596 37,610 36,928 38,146 Community Development 93,089 87,814 83,183 86,542 89,212 67,389 Planning 16,107 14,493 13,206 12,628 11,118 11,492 Public Works 44,473 42,029 39,463 41,672 37,443 53,584 Community Services 36,827 31,712 28,314 27,050 27,397 29,209 Public Utilities 1,800 1,704 1,557 1,566 1,811 2,928 Convention, Sports and Entertainment 10,539 8,652 7,703 7,536 7,211 8,577 Interest on long-term debt 50,053 46,430 47,105 48,503 47,405 46,098 Governmental activities expenses 430,280 389,669 367,783 348,230 346,631 337,539 (continued) 93 CITY OF ANAHEIM Changes in Net Assets Last Six Fiscal Years (In thousands)(Accrual basis of accounting) (continued)
Fiscal Year 2007 2006 2005 2004 2003 2002 Business-type activities:
Electric Utility 338,514 365,277 274,622 280,878 264,583 280,358 Water Utility 51,672 47,225 41,313 42,949 37,065 38,616 Sanitation 48,946 47,163 45,467 41,431 40,249 38,563 Golf Courses 4,365 4,433 4,062 4,278 3,699 3,745 Convention, Sports and Entertainment Venues 46,743 47,965 47,351 43,406 43,197 40,500 Business-type activities expense 490,240 512,063 412,815 412,942 388,793 401,782 Total government expenses 920,520 901,732 780,598 761,172 735,424 739,321 Net (Expense)
/ Revenue Governmental activities (239,659)
(211,610)
(226,426)
(214,995)
(220,546)
(213,109)Business-type activities (33,053) (51,497) 8,624 17,892 2,936 26,508 Total government, net (expense)
/ revenue (272,712)
(263,107)
(217,802)
(197,103)
(217,610)
(186,601)General Revenues and Other Changes in Net Assets Governmental activities:
Taxes: Property taxes $ 98,647 $ 90,299 $ 78,620 $ 57,239 $ 53,809 $ 49,867 Sales and use taxes 65,944 68,024 61,779 56,566 53,251 52,875 Transient occupancy taxes 83,914 75,979 67,141 63,268 56,199 57,780 Motor vehicle license fees 1,866 2,595 2,113 21,143 19,360 18,751 Other taxes 10,337 10,817 10,175 9,561 8,935 8,885 Unrestricted investment earnings 17,597 12,346 8,071 3,991 12,678 15,035 Other 1,701 5,078 1,499 1,097 2,852 3,825 Transfers (42,874) 8,444 12,400 11,534 3,996 3,809 Governmental activities 237,132 273,582 241,798 224,399 211,080 210,827 Business-type activities:
Unrestricted investment earnings 27,375 16,850 16,592 6,120 13,658 13,388 Other 418 1,723 51 Transfers 42,874 (8,444) (12,400) (11,534) -(3,996) (3,809)Business-type activities 70,249 8,406 4,610 (3,691) 9,713 9,579 Total government 307,381 281,988 246,408 220,708 220,793 220,406 Change in Net Assets Governmental activities (2,527) 61,972 15,372 9,404 (9,466) (2,282)Business-type activities 37,196, (43,091) 13,234 14,201 12,649 36,087 Total government change in net assets $ 34,669 $ 18,881 $ 28,606 $ 23,605 $ 3,183 $ 33,805 Source: Finance Department, City of Anaheim 94 CITY OF ANAIIEIM Governmental Activities Tax Revenues by Source Last Six Fiscal Years (In thousands)(Accrual basis of accounting)
Fiscal Year 2007 2006 2005 2004 2003 2002 Property Taxes$98,647 90,299 78,620 57,239 53,809 49,867 Sales and Use Taxes$65,944 68,024 61,779 56,566 53,251 52,875 Transient Occupancy Taxes$83,914 75,979 67,141 63,268 56,199 57,780 Motor Vehicle License Fees'$ 1,866 2,595 2,113 21,143 19,360 18,751 Other Taxes$10,337 10,817 10,175 9,561 8,935 8,885 Total$260,708 247,714 219,828 207,777 191,554 188,158* $100,000 90,000 60.000 40,000 20,000 i 0'2007 2006 2005 2004 .2003 2002 Fiscal vesi Mt Property Taxes El Sales and Use Taxes M Motor Vehicle License Fees at Other Taxes ElTransient Occupancy Taxes I The decrease in motor vehicle license fees starting from fiscal year 2005 is due to the shifting of revenue from motor vehicle license fees category to the property tax category.
This was part of the State of California 2004 Budget Act.Source: Finance Department, City of Anaheim 95 CITY OF ANAHEIM Fund Balances of Governmental Funds Last Ten Fiscal Years (In thousands)(Modified accrual basis of accounting)
Fiscal Year General Fund Reserved Unreserved
-designated Unreserved
-undesignated Total General Fund Housing Authority Fund Reserved Unreserved
-undesignated Total Housing Authority Fund Nonmajor Governmental Funds Reserved Unreserved
-designated, reported in: Special revenue funds Debt service funds Capital projects funds Unreserved
-undesignated, reported in: Special revenue funds Capital projects funds Total nonmajor governmental funds Total governmental funds'2007 2006 2005 2004 2003 2002 2001$ 11,212 $ 10,604 $ 9,892 $ 10,225 S 7,045 S 3,628 $ 3,620 293 4,872 208 204 44,722 44,075 39,179 34,458 31,096 32,740 25,336 55,934 54,679 49,071 44,976 43,013 36,576 29,160 162 7,935 8,097 137,585 2,415 2,276 35,510 (8,445)(26,839)142,502$206,533 92 3,840 3,932 135,654 9,1012 1,137 36,951 (437)(24,269)158,138$216,749 5,682 5,682 76,568 14,974 1,457 36,497 25,955 (4,735)150,716$205,469 198 5,525 4,854 5,525 5,052 11 4,347 4,503 4,347 4,514 2000$ 4,496 19,099 23,595 33 4,618 4,651 89,158 7,668 135,710 12,985 245,521$273,767 1999$ 17,985 13,344 31,329 788 5,170 5,958 93,545 11,262 244,849 7,992 357,648$394,935 1998$.18,997 13,952 32,949 108 4,1-19 4,227 113,529 399,555 11,163 524,247$561,423 91,787 7,993 24,538 27,016 151,334$201,835 103,136 103,463 13,305 33,194 53,890 17,406 12,022 153,736 182,680$201,801 $223,603 87,162 15,983 99,390 13,438 215,973$249,647' Restatements of fund balances have not been reflected for certain years.Source: Finance Department, City of Anaheim 96 CITY OF ANAHEIM Changes in Fund Balances of GovernmentalFunds Last Ten Fiscal Years (In thousands)(Modified accrual basis of accounting)
Fiscai Year 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 Revenues Property taxes $ 102,486 $ 90,323 $ 81,949 $ 60,563 S 57,151 S 53,018 $ 53,860 $ 49:478 $ 41,131 $ 39,492 Sales and use taxes 66,761 66,045 59,976 55,409 54,066 52,368 50,733 46,915 43,210 42,214 Transient occupancy takes 83,914 75,979 67,141 63,268 56,199 57,780 58,112 46,183 45,155 44,767 Othertaxes 7,531 7,862 7,542 7,095 6,570 6,460 6,365 5,831 5,755 5,492 Licenses, fees and permits 37,991 40,625 18,749 15,578 15,731 15.806 16,299 16,298 23,110 15,677 Intergovernmental revenues 111,527 103,653 101,447 108,673 107,973 104,434 85,500 82,186 74,225 78,617 Charges for services 12,960' 12,649 12,130 15,241 14,569 14,299 11.712 10,575 10,851 11.515 Fines, forfeits and penalties 3,689 3,464 3,454 2,812 2,673 2,769 3,118 3,187 2,807 1,556 Use of money and property 18,208 13,203 9,144 8,408 12,354 13,878 20.108 23,290 29,111 34,713 Other 7,601 18,164 6,143 3,490 3,436 4,654 1,242 12,809 1,589 1,199 Total revenues 452,668 431,967 367,675 340,537 330,722 325,466 307,049 296,752 276,944 275,242 Expenditures General government 15,354 13,667 12,276 11,370 12,823 12,403 16,462 12,394 15,417 19,816 Police 109,467 94,602 86,529 74,356 74,518 68,274 64,585 60,274 59,581 56,946 Fire 48,201 48,383 44,182 36,277 35,684 34,651 31,382 30,994 28,166 27,523 Community Development 94,789 89,098 83,384 87,778 91,984 72,919 67,493 43,848 49,082 51,467 Planning 14,762 13,907 12,313 11,904 10,285 10,463 10,145 9,471 8,850 7,456 Public Works 26,820 24,646 22,248 25,224 21,425 37,377 72,964 126,700 128,282 75,192 Community Services 32,788 28,753 25,724 25,203 25,938 26,011 24,296 22,949 21,555 19,850 Public Utilities 1,791 1,704 1,557 1,566 1,811 2,651 2,612 4,286 3,475 3,477 Convention, Sports and Entertainment 7,399 6,131 5,140 5,353 4,677 6,003 6,738 6,246 6,322 6,482 Capital outlay 76,161 77,738 41,301 32,195 40,881 35,310 32,713 66,002 84,560 51,429 Debt service: Principal 18,065 19,032 10,134 9,391 8,020 7,797 5,768 5,309 4,783 3,919 Interest and fiscal agent charges 41,187 39,037 38,681 38,630 38,330 38,081 37,438 36,108 36,447 38,127 D ebt issuance costs' 4,017. _T_ _T_5___T Total expenditures 490,801 456,698 383,469 359,247 366,376 351,940 372,596 424,581 446,520 361,684 Revenues over (under) expenditures (38,133) (24,731) (15,794) (18,710) (35,654) (26,474) (65,547) (127,829)
(169,576)
(86,442)Other financing sources (uses)Transfers in 101,249 95,535 99,166 73,939 67,407 66,480 52,381 53,758 38,796 43,187 Transfers out (91,028) (84,325) (88,277) (62,970) (63,759) (56,470) (45,906) (54,200) (39,099) (41,514)Issuance of refunding bonds 253,134_Payment to refunded bond escrow agent (255.325)Issuance of long-term debt 18,238 22,583 7,289 7,775 4,450 31,968 3,212 1,705 Special items 1,250 Proceeds from the sale of capital assets 20 5,754 "-Capital leases 1,649 2,198 Total other financing sources 27,917 36,011 19,428 18,744 , 13,852 10,010 38,443 2,770 1,402 1,673 Net change in fund balances $ (10,216) $ 11,280 $ 3,634 $ 34 $ (21,802) $ (16,464) $ (27,104) $(125,059)
$(168,174)
$ (84,769)Debt service as a percentage of non-capital expenditures 15.26% 15.33%. 14.27% 14.68% 14.24% 14.49% 12.71% 11.55% 11.39% 13.55%' Prior to the implementation of GASB Statement No. 34 in 2002, debt issuance costs were not displayed as expenditures but were recorded as part of issuance of long-term debt in the fund financial statements.
Source: Finance Department, City of Anaheim 97 CITY OF ANAHEIM General Government Tax Revenues by Source Last Four Fiscal Years (In thousands)(Modified accrual basis of accounting)
Fiscal Year 2007 2006 2005 2004 Secured Pfoperty Taxes$62,881 53,137 49,510 49,847 Unsecured Property Taxes$9,945 9,409 9,244 8,591 Supplemental Property Taxes$4,580 4,207 3,626 2,125 Property Taxes in-lieu of VLF'$25,080 23,570 19,569 Sales and Use Taxes$66,761 66,045 59,976 55,409 Transient Occupancy Taxes$83,914 75,979 67,141 63,268 Other Taxes$7,531 7,862 7,542 7,095 Total$260,692 240,209 216,608 186,335 90,000-80,000-70,000-60,000-'qi 50,00i0-":' 40,000-30,000-'1/2 20,000-10,000.2007 ' 2006 , : 2005 2004.g F-1Secured l'ropelly Taxes*t , OrPrp'leaxes i-lieu of VLF E3 Unsecured l'roperty Taxes Li Sales and Use Taxes Tr lansient Occupancy Taxes Collection of property taxes in-lieu of VLF starting in fiscal year 2005 is due to the shifting of revenue from motor vehicle license fees category to the property tax category.
This was part of the State of California 2004 Budget Act.Source: Finance Department, City of Anaheim 98 CITY OF ANAHEIM Assessed Value of Taxable Property Last Four Fiscal Years (In thousands)(Modified accrual basis of accounting)
Fiscal Year City of Anaheim Secured property Unsecured property Total City of Anaheim Anaheim Redevelopment Agency Secured property Unsecured property Total Anaheim Redevelopment Agency Total Taxable Assessed Value Total Direct Tax Rate 2007$26,507,229 2,442,959 28,950,188 2,838,528 813,249 3,651,777$32,601,965 0.1105%2006$24,081,039 1,117,310 25,198.349 2,574,542 734,299 3,308,841$28,507,190 0.1109%2005$22,288,504 1,162,358 23,450,862 2,332,303 748,144 3,080,447$26,531,309 0.1112%2004$20,826,232 1,287,967 22,114,199 2,177,936 731,733 2,909,669$25,023,868 0.1117%$30,000,000 25000,000 20,000,000 15 000000 5,000.000
-0 Assessed Property VlIie 4 207.Fisc"1Year 2005 2004 E] City of Anaheinm
- Anaheim Redevelopment Agency Source: Auditor-Controller, County of Orange 99 CITY OF ANAHEIM Property Tax Rates Direct and Overlapping Governments Last Four Fiscal Years Fiscal Year 2007 2006 2005 2004 City of Anaheim Total City Rate 0.1082% 0.1082% 0.1082% 0.1082%City General Obligation Bond Fund 0.0023% 0.0027% 0.0030% 0.0035%Total Direct Rate' 0.1105% 0.1109% 0.1112% 0.1117%Range of Overlapping Rates Elementary School Districts Rate 0.3202% 0.3259% 0.3242% 0.3228%High School Districts Rate 0.2134% 0.2143% 0.2175% 0.2135%Community College Districts Rate 0.0917% 0.0940% 0.0917% 0.0)932%Water District Rate 0.0138% 0.0143% 0.0149% 0.0152%Special Districts Rate 0.0753% 0.0753% 0.0753% 0.0753%County Rate 0.2426% 0.2426% 0.2426% 0.2426%Direct and Overlapping Rates' 1.0675% 1.0773% 1.0774% 1.0743%Excludes rates associated with Mello-Roos Districts.
2 In 1978, California voters passed Proposition 13 which sets the property tax rate at a 1% fixed amount. Valuations of real property are frozen at the value of the property in 1975, with an allowable adjustment up to 2% per year for inflation.
However; property is reassessed to its current value when a change of ownership occurs. New construction, including tenant improvementsi is assessed at its current value. This 1% is shared by all taxing agencies for which the subject property resides. In 1986, the State Constitution was amended to allow rates over the I% base rate for voter approved general obligation debt.Source: Auditor-Controller, County of Orange 100 CITY OF ANAHEIM Principal Property Tax Payers Last Ten Fiscal Years (In thousands)
Fiscal Year 2007 2006 2005 Tax Payer Walt Disney World Company Lennar Platinum Triangle Kaiser Foundation Health Anaheim Hotel Partnership PPC Anaheim Apartments CREA / Nexus Anaheim Anaheim Memorial Hospital Maguire Properties Boeing North America Angeli LLC Allstate Life Insurance Company Pan Pacific Retail Hilton Hospitality Inc.Macquarie Office Trust Reef America REIT II Joan MTR Schlund OTR Fairfield Resorts, Inc.Atrium Plaza, LLC Pacific Sunwear California, Inc.James P Crawford Kilroy Realty LP PC and RS Chao Family LTD Living Stream Prologis California I LLC UKA LLC Spieker Properties Equitable Pacific Security Capital Taromina Industries, Inc Weyerhauser Company Kwikset Corperation Catellus Development Corp.Total Rank 1 2 3 4 5 6 7 8 9 10 Taxable Assessed Value$3,466,814 205,049 149,332 129,662 104,040 95,333 88,254 81,600 81,428 78,733 Percentage of Total City Taxable Assessed Value 10.63%0.63%0.46%0.40%0.32%0.29%0.27%0.25%0.25%0.24%Rank 1 2 3 Taxable Assessed Value$3,383,738 142,276 108,181 Rank 8 Taxable Assessed Value$3,169. 133 70,501 2004 Taxable Assessed Rank Value 1 $3,140,270 2003 Taxable Assessed Rank Value 1 $3,011,080 4 102,000 8 83,576 7 84,336 5 99,035 6 89,368 9 75,249 10 72,522 5 6 2 4 82,683 73,773 111,282 87,518 2 5 3 4 6 7 9 8 10 127,443 72,327 109,100 106,456 70,994 65,401 57,872 65,308 55,968 2 5 3 4 6 9 8 7 135,401 71,001 120.30(0 104,316 70,488 49,455 56,048 64,971 3 108,431 7 72,414 9 66,763 10
- 59,102 1o 49,455$4,480,245
$4,240,281
$3,901,600
$3,871,139
$3,732,515 (continued) 101 CITY OF ANAHEIM Principal Property Tax Payers Last Ten Fiscal Years (In thousands)(continued) 2002 Taxable Assessed Rank Value 1 $2,267,576 2001 Taxable Assessed Rank Value 1 $1,457,785 Fiscal Year 2000 Taxable Assessed Rank Value 1 $1,339,334 1999 Taxable Assessed Rank Value 1 $1,030,221 Tax Payer Walt Disney World Company Lennar Platinum Triangle Kaiser Foundation Health Anaheim Hotel Partnership PPC Anaheim Apartments CREA / Nexus Anaheim Anaheim Memorial Hospital Maguire Properties Boeing North America Angeli LLC Allstate Life Insurance Company Pan Pacific Retail Hilton Hospitality Inc.Macquarie Office Trust Reef America REIT 1I Joan MTR Schlund OTR Fairfield Resorts, Inc.Atrium Plaza, LLC Pacific Sunwear California, Inc.James P. Crawford Kilroy Realty LP PC and RS Chao FamilyLTD Living Stream Prologis California I LLC UKA LLC Spieker Properties Equitable Pacific Security Capital Taromina Industries, Inc Weyerhauser Company Kwikset Coi'peration Catellus Development Corp. -Total 1998 Taxable Assessed Rank Value 1 $1,096,999 2 173,884 2 143,228 2 149,113 3 69,609 3 76,880 2 176,450 2 178,771 6 4 7 9 5 8 10 61,241 68,385 58,182 53,612 65,388 57,437 49,746 4 6 8 67,044 60,041 57,005 7 45,543 5 55,01)4 4 51,017 6 48,964 5 64,105 7 58,834 9 47,818 10 46,707 10 4 9 6 3 8 43,553 57,004 43,935 45,767 77,520 45,026$1,929,172 5 45,514 8 .43,600 3 96,269 6 44,539 7 43,930 9 40,812 10 40,612$1,615,285 4 51,764 8 43,330 3 94,517 7 43,717 10 40,603 9 43,203 5 50,155$1,687,136
$2,894,404
$2,085,332 Source: Finance Department, City ofAnaheim, H-dL Coren & Cone, Orange County Assessor 102 CITY OF ANAHEIM Property Tax Levies and Collections Last Four Fiscal Years (In thousands)
Fiscal Year 2007 2006 2005 2004 Total Secured Tax Levy$64,237 57,488 53,217 49,877 Coliected within the Fiscal Year of the Levy Percentage Amount of Levy$62,101 96.67%56,462 98.22%52,519 98.69%49,005 98.25%.Delinquent Tax Collections
$534 532 741 596 Total Collections as of 6/30 Percentage Amount of Levy$62,635 97.51%56,994 99.14%53,260 100.08%49,601 99.45%Source: Auditor-Controller, County of Orange 103 CITY OF ANAHEIM Ratios of Outstanding Debt by Type Last Four Fiscal Years (In thousands, except per capita amount)Fiscal Year Governmental Activities Bonds Certificates of participation Notes and loans Capital leases Total governmental activities Business-type Activities Bonds Certificates of participation Notes and loans Capital leases Total business-type activites Total Government Percentage of personal income Per capita 2007$740,107 26,788 57,614 2,484 826,993 706,126 96,475 14,081 267 816,949$1,643,942 17.92%$ 4,757 2006$740,959 30,066 43,342 2,220 816,587 513,874 125,087 14,976 275 654,212$1,470,799 16.52%$ 4,292 2005 S 739,775 33,174 28,669 1,523 803,141 528,130 132,952 15,842 180 677,104$1,480,245 17.04%S 4,326 2004 S 737,538 36,107 22,747 2,001 798,393 543,780 140,355 16,678 349-701,162$1,499,555 17.71%'V S 4,395 Note: Per capita amounts are estimates-Source: California State Department of Finance and Finance Department, City of Anahiefi 104 CITY OF ANAHEIM Ratios of General Bonded Debt Outstanding Last Ten Fiscal Years (In thousands, except per capita amnount)Fiscal Year 2007 2006 2005 2004 2003 Bonds General obligation S5,700 $6,170 S6,625 $ 7,060 S7,460 Lease revenue 588,534 575,125 569,016 562,118 554,361 TFax allocation 152,135 159,664 164,134 168,360 172,258 Total bonds 746,369 740,959 739,775 737,538 734,079 Less amounts available in debt service fond 39,075 39,232 -30,812 44,132 41,461 Total net obligation bonds outstanding
$707,294 $701,727 $708,963 $693,406 $692,618 Percentage of assessed value of property 2.17% 2.46% 2.67% 2.77% 3.04%Per capita $ 2,047 $ 2,048 $ 2,072 $ 2,032 $ 2,055 FiscallYear 2002 2001 2000 1999 1998 Bonds General obligation
$ 7,850 $8,205 $ 8,535 $ 8,850 $ 9,120 Lease revenue 546,152 538,207 530,717 523,658 517,005 Tax allocation 175,953 179,449 148,790 149,954 151,103 Total bonds 729,955 725,861 688,042 682,462 677,228 Less amounts available in debt service fond 44,916 36,900 59,066 70,118 86,201 Total net obligation bonds outstanding
$685,039 $688,961 $628,976 $612,344 $591,027 Percentage of assessed value of property 3.52% 4.30% 3.93% 4.01% 4.04%Per capita $ 2,045 $ 2,088 $ 1,918 $ 2,001 $ 1,964 Note: Details regarding the City's outstanding debt can be found in the notes to the basic financial statements.
Source: Finance Department, City of Anaheim 105 CITY OF ANAHEIM Direct and Overlapping Governmental Activities Debt As of June 30, 2007 (In thousands)
City Direct Debt Bonds Certificates of participation Notes and loans Capital leases Total City Direct Debt Debt Outstanding
$ 740,107 26,788 57,614 2,484$ 826,993 Overlapping Debt Repaid with Property Taxes Anaheim Elementary School District Buena Park Elementary School District Centralia Elementary School District Fullerton Elementary School District Anaheim Union High School District Magnolia School District North Orange Joint Community College Districts Rancho Santiago Conmmunity College Districts Metropolitan Water District (MWD)Fullerton Joint Union High School District Placentia
-Yorba Linda Unified School District Metropolitan Water District -Anaheim City Total Overlapping Debt Repaid with Property Taxes Total Direct and Overlapping Other Debt Debt Outstanding
$ 65,730 12,080 17,085 47,575 126,159 9,320 232,521 324,638 389,565 57,912 95,923 73,489$1,451,997 Estimated Percentage Applicable 100.00000%
100.00000%
100.00000%
100.00000%
Estimated Percentage Applicable 99.23000%0.09000%12.05000%0.16000%67.72000%68.10000%28.98000%13.02000%1.72000%0.00296%20.28000%8.21000%Estimated City's Share of Direct Debt$ 740,107 26,788 57,614 2,484 826,993 Estimated City's Share of Overlapping Debt$ 65,221 11 2,059 76 85,439 6,347 67,387 42,271 6,708 171 19.451 6,031 301,172$1,128,165 (continued) 106 CITY OF ANAHEIM Direct and Overlapping Governmental Activities Debt As of June 30, 2007 (In thousands)(continued) 2006-07 Assessed Valuation Redevelopment Incremental Valuation Adjusted Assessed Valuation Direct Debt Overlapping Debt Repaid with Property Taxes$32,601,965 (3,651,777)
$28,950,188 2.857%1.040%Note: In 1978, California voters passed Proposition 13 which sets the property tax rate at a 1% fixed amount. This 1% is shared by all taxing agencies for which the subject property resides. In 1986, the State Constitution was amended to allow rates over the 1% base rate for voter approved general obligation debt.Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the City. This process recognizes that, when considering the government's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government.
Source: HdL Coren & Cone 107 CITY OF ANAHEIM Legal Debt Margin Last Ten Fiscal Years (In thousands)
Fiscal Year 2007 2006 2005 2004 2003 Debt limit $3,976,084
$3,612,156
$3,343,276
$3,123,935
$3,418,119 Total net debt applicable to limit (5,700) (6,170) (6,625) (7,060) (7,460)Legal debt margin $3,970,384
$3,605,986
$3,336,651
$3,116,875
$3,410,659 Total net debt applicable to the limit as a percentage of debt limit 0.14% 0.17% 0.20% .0.23% 0.22%Legal Debt Margin Assessed property value $26,507,229
$24,081,039
$22,288,504
$20,826,232
$22,787,461 Debt limit (15% of total assessed value) 3,976,084 3,612,156 3,343,276 3,123,935 3,418,119 Fiscal Year 2002 2001 2000 1999 1998 Debt limit $2,882,716
$2,587,106
$2,363,255
$2,252,829
$2,158,778 Total net debt applicable to limit (7,850) (8,205) (8,535) (8,850) (9,120)Legal debt margin $2,874,866
$2,578,901
$2,354,720
$2,243,979
$2,149,658 Total net debt applicable to the limit as a percentage of debt limit 0.27% 0.32% 0.36% 0.39% 0.42%Legal Debt Margin Assessed property value $19,218,106
$17,247,371
$15,755,036
$15,018,863
$14,391,851 Debt limit (15% of total assessed value) 2,882,716 2,587,106 2,363,255 2,252,829 2,158,778 Note: Under State Finance Law, the City's outstanding general obligation debt should not exceed 15 percent of total assessed property value. By law, the general obligation debt subject to the limitation may be offset by amounts set aside for repaying general obligation bonds.Source: Finance Department, City of Anaheim 108 CITY OF ANAHEIM Pledged-Revenue Coverage Last Ten Fiscal Years (In thousands)
Electric Utility Revenue Bonds aiid Certificates of Participation Less Net Fiscal Gross Operating
-Available Debt Service Year Revenue Expenses Revenue Principal Interest Total. Coverage 2007 $330,421 $265,340 $65,081 $13,220 $22,177 $35,397 1.8386 2006 336,091 268,274 67,817 13,145 25,132 38,277 1.7717 2005 297,443 218,562 78,881 15,875 24,780 40,655 1.9403 2004 295,988 232,050 63,938 14,840 20,102 34,942 1.8298 2003 280,471 216,841 63,630 15,566 22,625 38,191 1.6661 2002 308,329 238,124 70,205 14,779 16,450 31,229 2.2481 2001 345,615 292,395 53,220 15,731 17,586 33,317 1.5974 2000 287,132 205,699 81,433 15,462 18,082 33,544 2.4276 1999 262,336 194,012 68,324 18,543 18,356 36,899 1.8516 1998 251,929 191,306 60,623 17,716 16,125 33,841 1.7914 W~ater Utility Revenue Bonds Fiscal Year 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 Gross Revenue$51,595 47,904 44,484 44,659 43,669 43,944 43,995 43,959 40,489 37,640 Less Operating Expenses$43,203 39,110 33,312 35,602 29,775 31,103 26,479 30,193 26,900 22,670 Net Available Revenue$8,392 8,794 11,172 9,057 13,894 12,841 17,516 13,766 13,589 14,970 Debt Service Principal$1,325 1,870 1,340 1,625 1,540 1,465 1,400 1,330 1,260 1,180 Interest$379 450 485 819 906 990 2,094 2,166 2,234 2,313 Total$1,704 2,320 1,825 2,444 2,446 2,455 3,494 3,496 3,494 3,493 Coverage 4.9249 3 .7905 6. 1216 3.7058 5.6803 5.2305 5 .0 132 3.9376 3. 8892 4.2857 (continued)10 109 CITY OF ANAHEIM Pledged-Revenue Coverage Last Ten Fiscal Years (In thousands)(continued)
Convention, Sports and Entertainment Venues Revenue Bonds and Certificates of Participation Fiscal Year 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 Gross Revenue$49,012 42,099 42,243 43,802 41,947 38,638 40,435 33,335 29,873 31,646 Less Operating Expenses$26,727 27,939 25,555 22,981 22,174 18,430 17,479 15,248 13,636 15,309 Net Available Revenue$22,285 14,160 16,688 20,821 19,773 20,208 22,956 18,087 16,237 16,337 Debt Service Principal$6,219 6,037 5,862 7,585 7,126 6,994 7,179 6,784 6,482 6,285 Interest$ 8,713 8,897 9,061 7,661 7,525 8,698 9,100 9,497 9,870 10,226 Total$14,932 14,934 14,923 15,246 14,651 15,692 16,279 16,281 16,352 16,511 Coverage 1.4924 0.9482 1.1183 1.3657 1.3496 1.2878 1.4102 1.1109 0.9930 0.9895 Note: Operating expenses exclude amortization and depreciation.
Source: Finance Department, City of Anaheim 110 CITY OF ANAHEIM Demographic and Economic Statistics Last Four Fiscal Years Fiscal Year 20)07 2006 2005 2004 Population 345,559 342,717 342,186 341,184 Personiil Income (thousands of dollars)$9,172,173 8,901,046 8,686,734' 8,466,140 Per Capita Personal Income$26,543 25,972 25,386 24,814 Median Age 32 2 32 2 322 30 Education Level in Years of Schooling 12.2 2 12.2 2 12.2 2 12.2 2 School Enrollment
.65,539 65,000 64,154 64,600 Unemployment Rate 3.90%3.70%3.90%3.60%Pei~entajleGr9wtL 0/o Fiscal Year.1 [3 2007 M 2006 02005 02004 1 Projection based on 10 year running average 2 Median age and education level based on census 2000 Source: California State Department of Finance Anaheim City Superintendent of Schools State of California, Employment Development Department State Department of Commerce and Labor III CITY OF ANAHEIM Principal Employers Last Four Fiscal Years Fiscal Year 2007 2006 2005 2004 Employer Disneyland Resort Kaiser Foundation Hospital Anaheim Memorial Hospital Medical Center Alstyle Apparel Honda Center Northgate Gonzalez Supermarkets Hilton Anaheim Long Beach Mortgage West Anaheim Medical Center Anaheim Marriott Boeing North America Opal Concepts Anaheim Sports Incorporated Aramark at Angels Stadium of Anaheim SBC Communications Rank 1 2 3 4 5 6 7 8 9 10 Employees 21,710 3,660 1,185 1,000 1,000 1,000 920 800 774 730 Percentage of Total City Employment 12.9%2.2%0.7%0.6%0.6%0.6%0.5%0.5%0.5%0.4%Rank 1 2 6 4 7 8 5 10 9 Employees 21,950 3,660 1; 185 1,600 1,000 1,000 1,200 800 774 Rank 1 2 6 7 Employees 22,180 2,580 1,185 1,000 Rank 1 4 6 8 Employees 22,650 1,500 1,185 1,000 8 960 9 774 4 1,750 3 2,000 5 1,200 10 700 7 1,000 3 3,500 2 3,500 3 2,000 5 1,200 10 700 9 700 Source: California Employment Development Department Inside Prospects Database 2005 amounts are estimates 112 CITY OFANAHEIM Full-time Equivalent City Government Employees by Function/Program Last Four Fiscal Years Fiscal Year 2007 2006 2005 2004 Function/Program City Council City Administration City Attorney City Clerk Human Resources Finance City Treasurer Police Fire Community Development Planning Public Works Community Services Public Utilities Convention, Sports and Entertainment Total 5 24 35 7 25 63 6 591 290 114 96 249 183 354 88 2,130 5 21 32 7 23 63 6 582 288 120 95 247 183 337 86 2,095 5 20 32 7 22 63 6 570 285 119 96 245 179 335 86 2,070 5 19 32 7 22 65 6 568 285 112 96 245 188 331 86 2,067 Source: City of Anaheim 113 CITY OF ANAHEIM Operating Indicators by Function Last Four Fiscal Years Fiscal Year 2007 2006 2005 2004 Function/Program Parks Number of park acres maintained per full-time equivalent employee 10.52 10.52 10.39 10.39 Number of sports fields prepared 66 66 66 69 Cost per acre of parks $10,288 $9,960 $8,791 $9,144 Cost per sports field maintained
$4,747 $4,596 $4,828 $4,377 City Libraries Total circulation
-books 1,536,044 1,363,327 1,422,072 1,689,744 Reference questions answered 87,318 67,663 93,964 151,379 Information assistance 294,940 318,089 375,944 450,052 Patrons (patron visits) 1,373,002 1,176,441 1,147,079 1,267,487 Patrons (borrowers) 161,278 139,611 114,700 100,690 Programs offered 3,923 2,740 3,559 3,572 Program attendance 129,661 84,631 79,912 99,330 Electronic resources users 257,089 227,005 206,569 201,739 Community Services Programs Number of youth program participants 362,839 362,839 354,505 346,171 Number of youth program participants in recreation classes 13,675 15,200 14,886 14,886 Number of adult program sports teams 756 812 820 639 Number of park rangei contacts 140,000 139,773 88,935 132,633 Anaheim Convention Center Number of events serviced 347 337 310 262 Number of attendees 1,098,000 1,002,000 1,202,000 992,000 Percentage of occupancy 82.0% 68.0% 76.5% 84.5%Fire Department Fire responses 649 687 519 590 False alarm responses 719 678 581 579 Mutual aid responses 2,296 2,271 2,530 2,441 Medical responses 16,326 16,679 13,783 14,130 Hazardous condition responses (spills, leaks, bomb removal, power line down, etc.) 263 322 138 134 Other responses (persons in distress, controlled burn, smoke scares, animal rescues, etc.) 10,420 9,984 9,041 8,760 Sources: Various City Departments 114 CITY OF ANAIIEIM Capital Assets Statistics by Function Last Four Fiscal Years Fiscal Year 2007 2006 2005 Function/Program Parks Community parks Mini parks Neighborhood parks Special use parks City Libraries Branch libraries Book mobiles Books in collection Library collections Anaheim Convention Center Square footage available Number of exhibit halls Fire Department Fire stations Training center Fire trucks, engines, and other vehicles 11 6 20 6 11 6 20 6 I1 6 21 6 6 2 568,593 618,512 1,130,000 5 5 2 575,120 618,512 1,130,000 5 4 1 440,601 509,212 1,130,000 5 2004 II 6 21 6 5 1 460,230 501,084 1,130,000 5 10 1 71 79 79 10 7 72 101 1 72 Source: Various City Departments 115 CITY OF ANAHE IM Legend* CITY HALL 200 S. ANAHEIM B1LVD.A FIRE STATIONS* POLICE STATIONS* LIBRARIES CITY FACILITIES" HEUPORT PARKS 1. HANSEN PARK 1300 S. Knott St.2. REID PARK 3100 W. Orange Ave.3. SCHWEITZER PARK 238 S. Bel Air St.4. MAXWELL PARK 2660 W. Orange Ave.5. PETER MARSHALL PARK 801 N. Magnolia Ave.6. BROOKHURST COMMUNITY PARK 2271 W. Cresent Ave.7. JOHN MARSHALL PARK 2066 Falmouth Ave.8. MODJESKA PARK 1331 S. Nutwood St.9. CLARA BARTON PARK 1926 Clearbrook Ln.10. CHAPARRAL PARK 1770 E. Broadway 11. WILLOW PARK 1625 W. Crone Ave.12. PALM LANE PARK 1595 Palais Rd.13. SAGE PARK 1313 Lido PI.14. STODDARD PARK 901 S. Ninth St.15. MANZANITA PARK 1260 Riviera St.16. LA PALMA PARK & STADIUM 1151 La Palma Park Way 17. PEARSON PARK 400 N. Harbor Blvd.18. LITTLE PEOPLES PARK 220 W. Elm St.19. JULIANNA PARK 309 E. Juliana St.20. GEORGE WASHINGTON PARK 250 E. Cypress St.21. COLONY PARK " 210 E. Lincoln Ave.22. WALNUT GROVE PARK 905 S. Anaheim Blvd.23. CITRUS PARK 104 S. Atchison St.24. PONDEROSA PARK 2100 S. Haster St.25. LINCOLN PARK 1440 E. Lincoln Ave.26. EDISON PARK 1145 Baxter St.27. BOYSEN PARK 951 State College Blvd.28. JUAREZ PARK 841 S. Sunkist St.29. PIONEER PARK 2565 E. Underhill Ave.30. RIO VISTA PARK 201 N. Parkvista St.31. OLIVE HILLS PARK 4200 Nohl Ranch Rd.32. RIVERDALE PARK 4545 E. Riverdale Ave.33. PERALTA CANYON PARK 115 N. Pinney Dr.34. PELANCONI PARK 222 S. Avenida Margarita 35. IMPERIAL PARK 450 S. Imperial Hwy.36. EUQALYPTUS PARK 100 N. Quintana Dr.37. OAK PARK 6400 E. Nohl Ranch Rd.38. YORBA REGIONAL PARK 7600 E. La Palma Ave.39. OAK CANYON NATURE CENTER 6700 Walnut Canyon Rd.40. SYCAMORE PARK 8268 Monte Vista Rd.41. CANYON RIM PARK 7305 E. Canyon Rim Rd.42. TOYON PARK 945 S.Weir Canyon Rd.43. ROOSEVELT PARK 8160 E.Bauer Rd.44. ROSS PARK 1280 W. Santa Ana St.45. COTTONWOOD PARK 853 W. Cottonwood Cir.46. DEER CANYON PARK Mohler & Santa Ana Rd.116